Fourth quarter net sales of $21.2 million,
gross margin of 61.0%, and net income of $0.1 million. Full year
net sales of $83.6 million, up 16% from the prior year, gross
margin of 60.8%, net loss of only $4.9 million, positive Adjusted
EBITDA of $1.9 million and positive operating cash flows.
ChromaDex Corp. (NASDAQ:CDXC) today announced fourth quarter and
fiscal year 2023 financial results.
Fourth Quarter 2023 and Recent Highlights
- Total net sales of $21.2 million, with $17.6 million from Tru
Niagen®, up 1% and 9%, respectively, from the prior year
quarter.
- Delivered strong gross margin of 61.0%, an increase of 380
basis points, compared to 57.2% from the prior year quarter.
- Achieved net income of $0.1 million, a $1.5 million improvement
from a net loss of $1.4 million in the prior year quarter.
- Adjusted EBITDA, a non-GAAP measure, was a positive $1.2
million, a $0.9 million improvement from the prior year
quarter.
- Maintained positive operating cash flows for a fourth
consecutive quarter, ending with $27.3 million in cash and no
debt.
- In October 2023, launched clinical strength Tru Niagen® Pro
1,000 mg, proven to elevate NAD+ levels by 150% in three
weeks.
- In November 2023, phase II clinical study published in the
peer-reviewed journal, Movement Disorders, found that
supplementation with Niagen® increased whole blood NAD+ levels up
to fourfold, improved coordination and eye movement while
maintaining biomarkers of stable liver and kidney function in
Ataxia Telangiectasia (AT) patients.
- In November 2023, clinical trial published in the peer-reviewed
journal, Nature Communications, found that high-dosages of Niagen®
induces a potent NAD+ response and is associated with mild
improvement in Parkinson's Disease.
Full Year 2023 Highlights
- Delivered on latest financial outlook to investors across all
metrics, and exceeded targets for gross margin and general and
administrative expense.
- Total net sales of $83.6 million, with $69.5 million from Tru
Niagen®, each increasing 16% year-over-year.
- Gross margin of 60.8%, an improvement of 140 basis points from
59.4% in the prior year.
- Selling and marketing expense as a percentage of net sales
improved 770 basis points year-over-year.
- General and administrative expense decreased $3.3 million
year-over-year.
- Net loss of $4.9 million or $0.07 loss per share, an $11.6
million improvement, or $0.17 per share, year-over-year.
- Adjusted EBITDA, a non-GAAP measure, was a positive $1.9
million, a $11.9 million improvement year-over-year.
- In August 2023, expanded ChromaDex’s worldwide reach launching
Tru Niagen® on iHerb, a global destination for supplements.
- In October 2023, Zesty Paws, a prominent name in pet
supplements, partnered with ChromaDex to launch a Healthy Aging
NAD+ Precursor supplement for pets, featuring Niagen®. This
partnership marks the entry into the longevity category for pets
and extends the power of Niagen® to animal companions.
- ChromaDex External Research Program (CERP™) celebrated its 10th
anniversary, signing more than 275 global research agreements with
over 235 independent, expert investigators to uncover the full
potential of NAD+ with Niagen®. This research has shown that the
health benefits of Niagen® translate from preclinical models to
human clinical studies for brain, heart and muscle health with
remarkable consistency. Looking to the next 10 years, there is
great anticipation for emerging benefits in sensory, infant,
maternal and reproductive health to be translated from preclinical
to human studies.
“ChromaDex had its strongest year yet, achieving $83.6 million
in revenue, up 16% year-over-year, with positive adjusted EBITDA of
$1.9 million, and consistent positive operating cash flows each
quarter. Additionally, the fourth quarter marked an important
milestone with the company achieving positive net income,” said Rob
Fried, ChromaDex Chief Executive Officer. “Ending the year with
$27.3 million in cash and no debt underscores our financial
strength. This solid foundation, paired with continued investments
in our future, fuels our optimism as we set the stage for
accelerated growth in 2024 and beyond. We're confident in our
trajectory and excited about the new market opportunities
ahead.”
Results of operations for the three months ended December 31,
2023 compared to the prior year quarter
ChromaDex reported net sales of $21.2 million, an increase of
$0.2 million, or 1%. The increase was driven by a $1.5 million
increase in Tru Niagen® sales, largely offset by a decline of $1.2
million in Niagen® ingredient sales since the prior year period
included a $2.0 million upfront minimum purchase from Nestle Health
Science.
Gross margin percentage improved 380 basis points to 61.0%. The
increase in gross margin percentage is largely attributable to a
shift in business and customer mix and benefits from economies of
scale.
Operating expense decreased $0.4 million to $13.1 million driven
by a reduction in general and administrative expense of $0.6
million and research and development of $0.1 million, partially
offset by $0.3 million of higher selling and marketing expense.
Delivered net income of $0.1 million, translating to $0.00
earnings per share, compared to a net loss of $1.4 million, or
$0.02 loss per share in the prior year quarter. Adjusted EBITDA, a
non-GAAP measure, was a positive of $1.2 million, a $0.9 million
improvement from the fourth quarter of 2022. See “Reconciliation of
Non-GAAP Financial Measures” for a reconciliation of non-GAAP
measures to net income (loss), the most directly comparable GAAP
measure.
Results of operations for the year ended December 31, 2023
compared to the prior year
ChromaDex reported net sales of $83.6 million, an increase of
$11.5 million, or 16%, driven by higher Tru Niagen® and ingredient
sales of $9.4 million and $2.4 million, respectively, slightly
offset by lower analytical and reference standards sales.
Gross margin percentage improved by 140 basis points to 60.8%
compared to 59.4% in the prior year. The increase in gross margin
percentage is attributable to a shift in customer mix, supply chain
management optimization efforts, and benefits from economies of
scale.
Operating expense decreased $5.0 million to $56.4 million driven
by $3.3 million in lower general and administrative expense paired
with a $1.9 million reduction in selling and marketing expense,
partially offset by a slight increase in research and development
expense.
Net loss was $4.9 million, or $0.07 loss per share, compared to
a net loss of $16.5 million, or $0.24 loss per share, in the prior
year. Adjusted EBITDA, a non-GAAP measure, was a positive $1.9
million, an improvement of $11.9 million from the prior year. See
“Reconciliation of Non-GAAP Financial Measures” for a
reconciliation of non-GAAP measures to net loss, the most directly
comparable GAAP measure.
Net cash inflow from operating activities was $7.1 million,
showing a significant improvement compared to a net cash outflow of
$15.1 million in the prior year. This increase is largely due to
improvements in net loss of $11.6 million and positive impacts from
changes in working capital. ChromaDex ended fiscal year 2023 with
$27.3 million in cash and cash equivalents and no debt.
2024 Outlook
Looking forward, for the full year, the Company expects the
trajectory of revenue growth to continue, projecting a higher rate
of revenue growth than the prior year growth of 16%. This outlook
assumes continued revenue growth through our e-commerce business as
well as established partnerships, and assumes upside from
opportunities with new partnerships, channels, and products. The
Company projects that gross margin will improve slightly
year-over-year driven by continued supply chain optimization
efforts and cost savings, along with overall scale. Moreover,
selling and marketing expense will increase in absolute dollars but
remain stable as a percentage of net sales, as the Company
continues to make focused investments to drive brand awareness and
support new market launches, while maintaining efficiency. The
Company plans to increase investments in research and development
to drive future innovation and expects an increase in general and
administrative expense of $1.5 million - $2.5 million to support
growth.
Investor Conference Call
A live webcast will be held Wednesday, March 6, 2024 at 4:30
p.m. Eastern time (1:30 p.m. Pacific time) to discuss ChromaDex’s
fourth quarter and fiscal year 2023 financial results and provide a
general business update.
To listen to the webcast, or to view the earnings press release
and its accompanying financial exhibits, please visit the Investor
Relations section of ChromaDex’s website at www.ChromaDex.com. The
toll-free dial-in information for this call is 1-888-596-4144 with
Conference ID: 8584242.
The webcast will be recorded, and will be available for replay
via the website from 7:30 p.m. Eastern time on March 6, 2024 to
11:59 p.m. Eastern time on March 13, 2024. The replay of the call
can also be accessed by dialing 1-800-770-2030, using the Replay
ID: 8584242.
Important Note on Forward Looking Statements:
This release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, and Section
21E of the Securities Exchange Act of 1934. Statements that are not
a description of historical facts constitute forward-looking
statements and may often, but not always, be identified by the use
of such words as “expects,” “anticipates,” “intends” “estimates,”
“plans,” “potential,” “possible,” “probable,” “believes” “seeks,”
“may,” “will,” “should,” “could,” “predicts,” “projects,”
“continue,” “would” or the negative of such terms or other similar
expressions. Forward-looking statements include statements
regarding our intentions, beliefs, projections, outlook, analyses
or current expectations concerning, among other things: the
quotation from ChromaDex’s Chief Executive Officer, and statements
related to the Company’s 2024 financial outlook including but not
limited to revenue growth, gross margin, expenses, and investment
plans.
Risks that contribute to the uncertain nature of the
forward-looking statements include: inflationary conditions and
adverse economic conditions; our history of operating losses and
need to obtain additional financing; the growth and profitability
of our product sales; our ability to maintain sales, marketing and
distribution capabilities; changing consumer perceptions of our
products; our reliance on a single or limited number of third-party
suppliers; risks of conducting business in China; and the risks and
uncertainties associated with our business and financial condition
in general, described in our filings with the Securities and
Exchange Commission (SEC), including, without limitation, our most
recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q
as filed with the SEC. Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as
of the date hereof, and actual results may differ materially from
those suggested by these forward-looking statements. All
forward-looking statements are qualified in their entirety by this
cautionary statement and ChromaDex undertakes no obligation to
revise or update this release to reflect events or circumstances
after the date hereof.
About ChromaDex:
ChromaDex Corporation is a global bioscience company dedicated
to healthy aging. The ChromaDex team, which includes world-renowned
scientists, is pioneering research on nicotinamide adenine
dinucleotide (NAD+), an essential coenzyme that is a key regulator
of cellular metabolism and is found in every cell of the human
body. NAD+ levels in humans have been shown to decline with age,
among other factors, and may be increased through supplementation
with NAD+ precursors. ChromaDex is the innovator behind the NAD+
precursor nicotinamide riboside (NR), commercialized as the
flagship ingredient Niagen®. Nicotinamide riboside and other NAD+
precursors are protected by ChromaDex’s patent portfolio.
The Company delivers Niagen® as the sole active ingredient in
its consumer product Tru Niagen® available at www.truniagen.com and
through partnerships with global retailers and distributors. The
Company also develops and commercializes proprietary-based
ingredient technologies and supplies these ingredients as raw
materials to the manufacturers of consumer products. The Company
further offers natural product fine chemicals, known as
phytochemicals, and related research and development services.
Follow us on X (formerly Twitter) @ChromaDex and Instagram
@TruNiagen and subscribe to our latest news via our website
accessible at www.chromadex.com to which ChromaDex regularly posts
copies of its press releases as well as additional updates and
financial information about the Company.
ChromaDex Corporation and
Subsidiaries
Consolidated Statements of
Operations
Three Months Ended December
31,
Year Ended December
31,
2023
2022
2023
2022
(In thousands, except per share data)
Sales, net
$
21,196
$
20,996
$
83,570
$
72,050
Cost of sales
8,259
8,980
32,790
29,253
Gross profit
12,937
12,016
50,780
42,797
Operating expenses:
Sales and marketing
6,520
6,187
26,438
28,313
Research and development
1,159
1,279
4,958
4,826
General and administrative
5,426
5,994
24,983
28,286
Total operating expenses
13,105
13,460
56,379
61,425
Operating loss
(168
)
(1,444
)
(5,599
)
(18,628
)
Other income, net - Employee Retention Tax
Credit
—
—
—
2,085
Interest income, net
282
26
661
3
Net income (loss)
$
114
$
(1,418
)
$
(4,938
)
$
(16,540
)
Net income (loss) per share attributable
to common stockholders:
Basic
$
—
$
(0.02
)
$
(0.07
)
$
(0.24
)
Diluted
$
—
$
(0.02
)
$
(0.07
)
$
(0.24
)
Weighted average common shares
outstanding:
Basic
75,122
73,878
74,985
69,729
Diluted
75,135
73,878
74,985
69,729
ChromaDex Corporation and
Subsidiaries
Consolidated Balance
Sheets
December 31,
(In thousands except par values, unless
otherwise indicated)
2023
2022
Assets
Current assets:
Cash and cash equivalents, including
restricted cash of $152 for both periods presented
$
27,325
$
20,441
Trade receivables, net of allowances of
$68 and $122, respectively; Including receivables from Related
Party of $2.8 million and $3.1 million, respectively.
5,234
8,482
Inventories
14,525
14,677
Prepaid expenses and other assets
2,450
2,967
Total current assets
49,534
46,567
Leasehold improvements and equipment,
net
2,137
2,799
Intangible assets, net
510
671
Right-of-use assets
2,400
3,523
Other long-term assets
383
497
Total assets
$
54,964
$
54,057
Liabilities and Stockholders'
Equity
Current liabilities:
Accounts payable
$
10,232
$
9,679
Accrued expenses
9,493
7,337
Current maturities of operating lease
obligations
691
680
Current maturities of finance lease
obligations
11
16
Customer deposits
195
157
Total current liabilities
20,622
17,869
Deferred revenue
3,311
3,955
Operating lease obligations, less current
maturities
2,563
3,539
Finance lease obligations, less current
maturities
12
22
Total stockholders’ equity
28,456
28,672
Total liabilities and stockholders’
equity
$
54,964
$
54,057
ChromaDex Corporation and
Subsidiaries
Consolidated Statements of
Cash Flows
The following table presents selected data
from our consolidated statements of cash flows for the years
presented:
Year Ended December
31,
(In thousands)
2023
2022
Net cash provided by / (used
in):
Operating activities
$
7,117
$
(15,098
)
Investing activities
(143
)
(334
)
Financing activities
(90
)
7,654
Net increase (decrease) in cash and cash
equivalents
6,884
(7,778
)
Cash and cash equivalents beginning of
year
20,441
28,219
Cash and cash equivalents at end of
year
$
27,325
$
20,441
ChromaDex Corporation and
Subsidiaries
Unaudited Reconciliation of
Non-GAAP Financial Measures
Reconciliation of Net Loss to Adjusted
EBITDA
Three Months Ended
Full Year 2023
(In thousands)
Q1 2023
Q2 2023
Q3 2023
Q4 2023
Net income (loss), as reported
$
(1,902
)
$
(2,191
)
$
(959
)
$
114
$
(4,938
)
Adjustments:
Interest income, net
(66
)
(125
)
(188
)
(282
)
(661
)
Depreciation
228
232
233
177
870
Amortization of intangibles
41
39
39
39
158
Amortization of right of use assets
171
173
176
157
677
Share-based compensation
1,273
1,324
1,117
1,037
4,751
Severance and restructuring
186
766
86
5
1,043
Adjusted EBITDA
$
(69
)
$
218
$
504
$
1,247
$
1,900
Reconciliation of Net Loss to Adjusted
EBITDA
Three Months Ended
Full Year 2022
(In thousands)
Q1 2022
Q2 2022
Q3 2022
Q4 2022
Net loss, as reported
$
(7,740
)
$
(6,397
)
$
(985
)
$
(1,418
)
$
(16,540
)
Adjustments:
Interest expense (income), net
8
10
5
(26
)
(3
)
Depreciation
201
212
235
221
869
Amortization of intangibles
49
50
44
43
186
Amortization of right of use assets
299
169
170
191
829
Share-based compensation
1,888
1,296
1,229
1,326
5,739
Severance and restructuring
821
17
181
13
1,032
Other income - Employee Retention Tax
Credit
$
—
$
—
$
(2,085
)
$
—
(2,085
)
Adjusted EBITDA
$
(4,474
)
$
(4,643
)
$
(1,206
)
$
350
$
(9,973
)
Non-GAAP Financial Information:
To supplement ChromaDex’s unaudited financial data presented in
accordance with generally accepted accounting principles (GAAP),
the Company has presented Adjusted EBITDA, a non-GAAP financial
measure. ChromaDex believes the presentation of such non-GAAP
financial measure provides important supplemental information to
management and investors and enhances the overall understanding of
the Company’s historical and current financial operating
performance. The Company believes disclosure of the non-GAAP
financial measure has substance because the excluded expenses are
infrequent in nature, are variable in nature or do not represent
current cash expenditures. Further, such non-GAAP financial measure
is among the indicators the Company uses as a basis for evaluating
the Company’s financial performance as well as for planning and
forecasting purposes. Accordingly, disclosure of this non-GAAP
financial measure provides investors with the same information that
management uses to understand the Company’s economic performance
year-over-year.
Adjusted EBITDA is defined as net income before (a) interest,
(b) depreciation, (c) amortization, (d) non-cash share-based
compensation costs, (e) severance and restructuring expense and (f)
Other income from the Employee Retention Tax Credit. While
ChromaDex believes that this non-GAAP financial measure provides
useful supplemental information to investors, there are limitations
associated with the use of such measure. This measure is not
prepared in accordance with GAAP and may not be directly comparable
to similarly titled measures of other companies due to potential
differences in the method of calculation. Management compensates
for these limitations by relying primarily on the Company’s GAAP
results and by using Adjusted EBITDA only supplementally and by
reviewing the reconciliation of the non-GAAP financial measure to
its most comparable GAAP financial measure.
Non-GAAP financial measures are not in accordance with, or an
alternative for, generally accepted accounting principles in the
United States. The Company’s non-GAAP financial measure is not
meant to be considered in isolation or as a substitute for
comparable GAAP financial measures and should be read only in
conjunction with the company’s consolidated financial statements
prepared in accordance with GAAP.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240306680999/en/
Investor Relations +1 (949) 356-1620
InvestorRelations@ChromaDex.com
Media Relations Kendall Knysch Director of Media
Relations +1 (310) 388-6706 Ext. 689
Kendall.Knysch@ChromaDex.com
ChromaDex (NASDAQ:CDXC)
Historical Stock Chart
From Mar 2024 to Apr 2024
ChromaDex (NASDAQ:CDXC)
Historical Stock Chart
From Apr 2023 to Apr 2024