Q3 2023 ChromaDex Corp Earnings Call
Speaker 1: Please wait, the conference will begin shortly.
Please wait the conference will begin shortly.
[music].
Speaker 2: Hello and thank you for standing by. My name is Regina and I will be your conference operator today. At this time, I would like to welcome everyone to the Chromadex Corporation third quarter 2023 earnings conference call. All lines have been placed on mute to prevent any background noise.
Hello, and thank you for standing by my name is Regina and I will be your conference operator today at this time I would like to welcome everyone to the Chroma next Corporation third quarter 2023 earnings Conference call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and Dan.
Speaker 2: After the speaker's remarks, there will be a question and answer session.
Speaker 2: If you'd like to ask a question during this time, simply press star then the number one on your telephone keypad. To withdraw your question, press star one again. We ask that you please limit yourself to one question and one follow-up. I would now like to turn the conference over to Kendall Knish, head of public relations and partnerships. Please go ahead.
Session, if you'd like to ask a question. During this time simply press Star then the number one on your telephone keypad to withdraw your question Press Star one again.
I ask that you. Please limit yourself to one question and one follow up I would now like to turn the conference over to Kendall connect had a public relations and partnerships. Please go ahead.
Speaker 3: Thank you, good afternoon, and welcome to Chromenex Corporation's third quarter 2023 results investor call.
Thank you good afternoon, and welcome to Chroma next corporations third quarter 2023 results Investor call.
Speaker 3: With us today are Chromanex's Chief Executive Officer, Rob Fried.
With us today are chromite extra as Chief Executive Officer, Rob fried.
Speaker 3: Chief Financial Officer, Brianna Gerber, and Senior Vice President of Scientific and Regulatory Affairs, Dr. Andrew Hsiao, who will join the call for Q&A.
<unk> Financial Officer, Brianna, Gerber and senior Vice President of scientific and regulatory Affairs, Dr. Andrew Shao, who will join the call for Q&A.
Speaker 3: Today's conference call may include forward-looking statements, including statements related to Chromodex's research and development and clinical trial plans and the timing and results of such trials.
Today's conference call May include forward looking statements, including statements related to chrome attached as research and development and clinical trial plans and the timing and results of such trials.
Speaker 3: The timing of future regulatory filing, the expansion of the sale of true nitrogen in new markets, business development opportunity.
The timing of future regulatory filings.
The expansion of the sale of <unk> and new markets.
Business development opportunities.
Speaker 3: Future financial results, cash needs, operating performance.
Future financial results cash needs operating performance.
Speaker 3: investor interests, and business prospects and opportunities, as well as anticipated results of operations.
Investor interest and business prospects and opportunities.
Well as anticipated results of operations.
Speaker 3: Forward-looking statements represent only the company's estimates on the date of this conference call and are not intended to give any assurance as to actual future results.
Forward looking statements represent only the company's estimates on the date of this conference call and are not intended to give any assurance as to actual future results.
Speaker 3: Because for looking statements relate to matters that have not yet occurred, these statements are inherently subject to risks and uncertain.
Because forward looking statements relate to matters that have not yet occurred. These statements are inherently subject to risks and uncertainties.
Speaker 3: Many factors could cause chromatexes, actual activities or results to differ materially from the activities or results anticipated in forward looking statement.
Many factors could cause <unk> actual activities or results to differ materially from the activities and results anticipated in forward looking statements.
Speaker 3: These risk factors include those contained in Chromodex's quarterly report on Form 10Q, most recently filed with the SEC.
These risk factors include those contained in <unk> quarterly report on Form 10-Q, most recently filed with the SEC.
Speaker 3: including results of operations, financial condition, cash flows, as well as global market and economic conditions on our business. Please note.
Including results of operations financial condition cash.
Flows as well as global market and economic conditions on our business.
Please note that the company assumes.
Speaker 3: No obligation to update any forward looking statements after the date of this conference call to conform with the forward looking statements actual results or the changes in its expectation.
No obligation to update any forward looking statements. After the date of this conference call to conform with the forward looking statements actual results or to changes in its expectations.
Speaker 3: In addition, certain of the financial information presented in this call references non- GAAP financial measure.
In addition, certain of the financial information presented in this call references non-GAAP financial measures.
Speaker 3: The company's earnings presentation and earnings press release, which were issued this afternoon and are available on the company's website, present reconciliation to the appropriate GAAP measures .
The company's earnings presentation and earnings press release, which were issued this afternoon and are available on the company's website.
Reconciliations to the appropriate GAAP measures.
Speaker 3: This conference call is being recorded via Webcast. The Webcast will be available at the Investor Relations section of our website at www.chromodex.com.
Finally.
This conference call is being recorded via webcast. The webcast will be available at the Investor Relations section of our website at Www Dot <unk> Dot com.
Speaker 3: With that, it is now my pleasure to turn the call over to our Chief Executive Officer, Rob.
With that it is now my pleasure to turn the call over to our Chief Executive Officer, Rob Fried.
Speaker 4: Thanks, Kendall. Good afternoon, everyone, and thank you for joining us on today's investor call.
Thanks, Kendall good afternoon, everyone and thank you for joining us on today's investor call.
Speaker 4: For the third quarter, we delivered another solid quarter with the 19.5 million in revenue of 14% increase year-over-year, coupled with another quarter of positive of just the deal, but thought of $500,000.
For the third quarter, we delivered another solid quarter with $19 $5 million in revenue, a 14% increase year over year.
Coupled with another quarter of positive adjusted EBITDA of $500000.
Speaker 4: and net positive operating cash flow of $400,000.
Net positive operating cash flow of $400000.
Speaker 4: Your-to-date revenues are up 22%. And we have generated 6.5 million of positive cash flow from operations.
Year to date revenues are up 22% and.
And we have generated $6 5 million of positive cash flow from operations.
Speaker 4: We ended the third quarter with 26.8 million in cash and no debt.
We ended the third quarter with $26 8 million in cash and no debt.
Speaker 4: These continued achievements are a testament to our commitment in maintaining fiscal discipline and driving profitable growth for the business.
These continued achievements are a testament to our commitment and maintaining fiscal discipline and driving profitable growth for the business.
Speaker 4: The e-commerce business continues to be our largest and most consistent source of revenue. e-commerce net revenue is up 13% year over year, as our marketing team continues to focus on initiatives and campaigns that drive direct and efficient returns.
The E Commerce business continues to be our largest and most consistent source of revenue E. Commerce net revenue was up 13% year over year as our marketing team continues to focus on initiatives and campaigns that drive direct and efficient returns.
Speaker 4: For the total company sales and marketing expense was 31% of net revenues which was down sequentially and a significant reduction from 34.4% in the prior year quarter.
For the total company sales and marketing expense was 31% of net revenues, which was down sequentially and a significant reduction from 34, 4% in the prior year quarter.
Speaker 4: We recognize that building a strong subscription base on our own website is critical to driving long-term customer value and we have identified important fundamental changes to rebuild this growth engine for the business.
We recognize that building a strong subscription based on our own website is critical to driving long term customer value and we have identified important fundamental changes to rebuild this growth engine for the business.
Speaker 4: to deliver on this key objective for 2024. We will look to increase resources to optimize our retention strategy, our content and our social media presence, beginning in the fourth quarter.
To deliver on this key objective for 2024, we will look to increase resources to optimize our retention strategy our content on our social media presence beginning in the fourth quarter.
Speaker 4: We also look to increase resources to support the launch of new innovations in 2020.
We will also look to increase resources to support the launch of new innovations in 2024.
Speaker 4: course with any transition, it will take time for the improvements in strategy and execution to be reflected in the net revenues and further efficiencies. We remain committed to being disciplined in our investments, and we believe that the resources we are investing in will amplify our message and our vision that Chromodex
Of course with any transition that will take time for the improvements in strategy and execution to be reflected in the net revenues and further efficiencies we remain committed to being disciplined in our investments and we believe that the resources. We are investing in will amplify our message and our vision that chrome IDEXX is.
Speaker 4: The gold standard in the NAD space and Truneyge and continues to be the best NAD product on the market.
The gold standard in the <unk> space and <unk> continues to be the best product on the market.
Speaker 4: Turning to our strategic partnerships, Watson's remains a strong contributor to growth with third quarter revenues of 3.1 million and 19 percent increase year over year.
Turning to our strategic partnerships Watson's remains a strong contributor to growth with third quarter revenues of $3 1 million.
19% increase year over year.
Speaker 4: As I mentioned last quarter, Watson's has been promoting the stacking concept, which involves combining true nitrogen with true nitrogen immune and or true nitrogen beauty. This continues to be an effective mess.
I mentioned last quarter Watson has been promoting the stacking concept, which involves combining <unk> with <unk> immune <unk> beauty.
This continues to be an effective message for consumers.
Speaker 4: We're exploring the opportunity to better implement the staffing concept in other markets to similarly promote the true knowledge.
We're exploring the opportunity to better implement the stacking concept in other markets to similarly, promote <unk> and immune product.
Speaker 4: The partnership with Spinal Farm in China remains one of great opportunity and importance. The process to pursue blue had approval continues to take longer than anticipated.
The partnership with final farm in China remains one of great opportunity and importance the process to pursue blue had approval continues to.
To take longer than anticipated.
But that is not stopping our teams.
Speaker 4: continuing to work closely with SIDAL Farm. The execute campaigns and initiatives to capture the market opportunity.
Continuing to work closely with final form to execute campaigns and initiatives to capture the market opportunity in the country.
Speaker 4: encouragingly last month, Trunyogen was featured as the best NR supplement in 2023 in an article through Health Products Association China.
Encouragingly last month <unk> was featured as the best in our supplement in 2023, and an article through Health Products Association China.
Speaker 4: Last quarter I highlighted our new partnership with IHR.
Last quarter I highlighted our new partnership with <unk>.
Speaker 4: While the partnership is still in the early stages of growth, we have been pleased with the performance so far. As expected, around 80% of true nights and sales through IHIRB have been to international concerns.
The partnership is still in the early stages of growth. We have been pleased with the performance so far as expected around 80% of tonight's and sales through I heard there's been two international consumers. We continue to be optimistic in the partnership with <unk> to drive expanded international presence for <unk> and are actively working with them on campaigns to future.
Speaker 4: continue to be optimistic in the partnership with IHIRB to drive expand an international presence for Trinage and are actively working with them on campaigns to feature our brand more prominently on the planet.
And more prominently on the platform.
Speaker 4: With our Niant Ingredient Partners, there are two significant milestones I'd like to announce.
With our nitrogen ingredient partners. There are two significant milestones I'd like to announce first we're partnering with zesty pause the number one selling pet supplement brand in the U S to make <unk> available to benefit the healthy aging for dogs with the launch of the healthy aging NAV plus precursor.
Speaker 4: First, we are partnering with ZestyPause, the number one selling pet supplement brand in the US, to make niogen available to benefit the healthy aging for dogs, with a launch of the healthy aging NAD plus pre-
Speaker 4: We are proud to partner with Zestin Puzz to extend the benefit of nitrogen to all members of our families, including our canine components.
We are proud to partner with zest and pause to extend the benefit of nitrogen to all members of our families, including our canine companions.
Speaker 4: Global Authority on NAD and Healthy Aging Research. This is a breakthrough in the company's mission to improve as many lives as possible with the transformative power of nitrogen. votre vaARD more on ourNetartC CrossFit mission has received an alliance and began to have
The global authority on NAV.
And healthy aging research. This is a breakthrough in the Companys mission to improve as many lives as possible with the transformative power of nitrogen.
While we are in the early stages of the first product launch we look forward to future innovations in the supplement space in partnership with Zesty Pas, who placed the second order of nitrogen last month.
Speaker 4: the first product launch. We look forward to future innovations in the pet subtleness space.
Speaker 4: partnership with Zestipause who placed a second order of NIAGEM last month.
Speaker 4: Second, Nestle Health Science launched its Soildar cellular nutrition line of supplements, featuring a multi-ingredium product that incorporates niogen to support cell energy, repair and bite.
Second Nestle Health Science launched its Sagar cellular nutrition line of supplements featuring a multi ingredient product that incorporates nitrogen to support sell energy repair and vitality.
Speaker 4: Cellular energy product combines nitrogen with sources of vitamin C and B to support energy metabolism in immune heart and nerve health.
The cellular energy product combines <unk> with sources of vitamin C and D to support energy metabolism immune heart and nerve health.
Speaker 4: It is inspiring and encouraging to continue to work with the passionate teams and Nestle to launch innovative products to optimize cellular health and promote long-distance.
It is inspiring and encouraging to continue to work with the passionate teams at Nestle to launch innovative products to optimize cellular health and promote longevity.
Speaker 4: I look forward to announcing future innovative product launches under the Nestle Health Science portfolio.
I look forward to announcing future innovative product launches under the Nestle health science portfolio.
Well known brands.
Speaker 4: Finally, we are pleased to announce the launch of our two Nige and Pro 1000 milligram product line introducing a clinical strength dose.
And finally, we are pleased to announce the launch of our <unk> Pro 1000 milligram product line, introducing a clinical strength dose.
Speaker 4: powers consumers to improve their NAD levels in a more efficient and more efficacious.
Power's consumers to improve the NAD levels in a more efficient and more efficacious way.
Speaker 4: among published clinical studies to date the most extensively researched daily dose of nitrogen is one thousand milligrams two thousand milligrams is the highest dose with fabulous
Among published clinical studies to date, the most extensively researched daily dosing Biogen is 1000 milligrams with 2000 milligrams as the highest dose with established safety.
Speaker 4: 1,000 milligram dosage has been clinically proven to be safe, elevating NAD levels up to 150% after just two weeks, compared to 40 to 50% improvement in NAD levels with the 300 milligram daily dose.
1000, milligram dose, which has been clinically proven to be safe elevating NAD levels up to 150% after just two weeks.
Third to 40% to 50% improvement in NTT levels with the 300 milligram daily dosage.
Speaker 4: Excited to introduce this new addition to our product portfolio, aimed at consumers looking to take aging into their own hands and improve their lives.
We're excited to introduce this new addition to our product portfolio.
Aimed at consumers looking to take aging into their own hands and improve their livelihoods.
Speaker 4: Chrome, it has to continue to be in its strongest financial position to date. We're building momentum toward growth.
<unk> continues to be in its strongest financial position to date and we are.
Building momentum toward growth opportunities, while certain commercial opportunities are taking more time to unlock.
Speaker 4: While certain commercial opportunities are taking more time to unlock, I am impressed with the progress in our innovation pipeline.
I'm impressed with the progress in our innovation pipeline.
Speaker 4: Brianna will touch on the updated outlook for 2023, but I'm increasingly confident that we are setting the stage for further growth opportunities in 2024 and.
Briana will touch on the updated outlook for 2023, but I am increasingly confident that we are setting the stage for further growth opportunities in 2024 and beyond.
Speaker 4: We're building on our powerful scientific foundation as the world's leading NAD company, maintaining our position as a Paragon of Scientific Integ.
We are building on our powerful scientific foundation as the world's leading company, maintaining our position as a paragon of scientific integrity.
Speaker 4: through the Provenex External Research Program or CERP. We continue to foster our relationship of trust and integrity in the scientific community, and we continue to drive science.
Through the carbon X external research program or served we continue to foster a relationship of trust and integrity in the scientific community and.
And we continue to drive scientific innovation.
Speaker 4: our last update for additional human trials on nicotinamide riboside have been registered, one of which I want to highlight. It aims to explore how NR affects the energy and immune-related features of specific immune cells, myeloid cells, in different populations. Inflammation or the concept
Since our last update for additional human trials on nicotinamide Riboside has been registered one of which I want to highlight that aims to explore how NR effects the energy and immune related features of specific immune cells myeloid cells and different populations.
Inflammation or the concept of inflammation.
Speaker 4: Remains an important area of research on how NR can play an active and beneficial role in reducing inflammation as a healthy aging gun.
It remains an important area of research on how NR can play an active and beneficial role in reducing inflammation is a healthy aging benefit.
Speaker 4: In August , the results of a clinical study published in the peer-reviewed journal, So Report.
In August the results of a clinical study published in the peer reviewed journal cell reports.
Speaker 4: indicated that NR was successful in reducing inflammation in both healthy subjects and in cells derived from psorias.
<unk> indicated that NR was successful in reducing inflammation in both healthy subjects and in cells derived from psoriasis patients.
Speaker 4: This marks a significant achievement in NAD research, as it further validates NR as a proactive safe guard against inflammatory cytokines, and healthy individuals, and in those with...
This marks a significant achievement and NAD research as it further validates <unk> as a proactive safeguard against inflammatory cytokines and healthy individuals and in those with inflammation related disorders.
Speaker 4: further emphasize the magnitude of this study, Helio, a leading medical media company and trusted platform physicians and health care professionals featured the results of the study, along with commentary from Dr. Charles Brennan.
To further emphasize the magnitude of this study Helios, a leading medical media company and trusted platform physicians and Health Corp. Healthcare professionals featured the results of the study along with commentary from Dr. Charles Brenner.
Speaker 4: In addition, the results of a clinical study that investigated the safety benefits of long-term and our supplementation in individuals with a taxia, a rare genetic neurodegenerative disorder were published in October .
In addition, the results of a clinical study that investigated the safety benefits of long term NR supplementation in individuals with <unk> ataxia, a rare genetic neurodegenerative disorder were published in October.
Speaker 4: Previous studies have shown that NAD deficiency plays a role in disease mechanisms underlying DNA repair disorders such as AIDS.
Previous studies have shown that NAD deficiency plays a role in disease mechanisms underlying DNA repair disorders, such as <unk>.
Speaker 4: The results of this critical study build on those from a previously published short-term trial.
The results of this clinical study builds on those from a previously published short term trial and confirm that long term supplementation of NR was safe and well tolerated and improved motor coordination and eye movements in the patients with 80 of various ages.
Speaker 4: that long-term supplementation event are with SAFE and well-tolerated and improved motor coordination and eye movements in the patients with AT of various SAFE.
Speaker 4: Cert remains committed to conducting research uncovered different ways, nidgin, and competitive consumers, including therapeutic benefits for consumers, coping with different outcomes.
Search remains committed to conducting research to uncover different ways <unk> can benefit consumers, including therapeutic benefits for consumers coping with different elements today.
Speaker 4: The day we have announced two published peer-reviewed clinical studies on Parkinson's disease by a group of researchers led by Dr. Tzuulis, one of our STEAM SERP investigators.
Today, we have announced two published peer reviewed clinical studies in Parkinson's disease.
A group of researchers led by Dr. Xu list, one of our steam syrup investigators.
Speaker 4: A third study of Parkinson's disease by Dr. Tzouzis' lab was recently completed.
Third study of Parkinson's disease by Dr. <unk> Lab was recently completed.
Speaker 4: This study investigated the safety of supplementing 3,000 milligrams per day of NR to PD patients. The highest dose studied today.
This study investigated the safety of supplementing 3000 milligrams per day of NR to PD patients the highest dose studied to date.
Speaker 4: a wake publication of the study results and arts.
Really await publication of the study results.
And are excited to share more in future updates.
Speaker 4: At Chromodex we continue to work with the steam leaders in the field of aid.
At <unk>, we continue to work with the steam leaders in the field of aging.
Speaker 4: Earlier this year, we announced the appointment of leading aging and neurodegenerative disease researcher Dr. Wilhelm Boer to our scientific advisory board. Dr. Boer joins a distinguished board which includes two chemistry Nobel Prize winners and Dr. Roger Cornberg and Professor Serge on Walker. And includes the world's foremost authority on NAD metabolism Dr. Charles Brenner.
Earlier this year, we announced the appointment of leading ageing and neuro degenerative disease researcher Dr. Wilhelm bore.
Our scientific Advisory Board Dr.
Dr bore joins a distinguished Board, which includes two chemistry Nobel Prize winners and Dr. Roger Kornberg, and Professor Sir John Walker and includes the world's foremost authority on NAD metabolism, Dr. Charles Brenner.
Speaker 4: In October , the National Academy of Medicine announced that Dr. Rudolph Tancy, another member of our Scientific Advisory Board, was elected as a member of the Academy, recognizing his contributions as a pioneer and leader. In re-
In October the National Academy of Medicine announced that Dr. Rudolph Tansey. Another member of our scientific Advisory Board was elected as a member of the Academy recognizing his contributions as a pioneer and leader in.
In research and Alzheimers disease.
Speaker 4: We applaud this achievement as the election to the Academy is recognized as one of the highest honors in the field of health.
We applaud this achievement as the election to the Academy is recognized as one of the highest honors in the field of health and medicine.
Speaker 4: continue to defend our achievements and inventions and to take action to prevent infringement.
We continue to defend our achievements and inventions and to take action to prevent infringement.
Speaker 4: mentioned in our prior calls. Last year we were granted a series of new critical patents, which in combination with existing IP and patents from WR grace, who has supplied to Chroma that's exclusively for the last decade. We protect our NRIP.
As mentioned in our prior calls last year, we were granted a series of new critical patents, which in combination with existing IP and patents from WR Grace, who have supply to chrome IDEXX exclusively for the last decade with protect our NR IP for at least the next decade.
Speaker 4: Last month, the jury in the U.S. District Court of Delaware decisively found that O'Leahsium Health will fully infringed on W.R. Grace patents, protecting and are supplied exclusively to Chrome.
Last month, the jewelry in the U S District Court of Delaware decisively found that Elysium health willfully infringed on WR Grace patents protecting and are supplied exclusively to chromebooks.
Speaker 4: Additionally, I'm proud to announce that we have extended our 10-year collaboration with WR.
Additionally, I am proud to announce that we have extended our 10 year collaboration with WR Grace to continue delivering the highest quality.
Speaker 4: continue delivering the highest quality NAD precursor in the world.
Precursor in the world.
Speaker 4: Finally, I want to briefly comment on the recent favorable decision to Chromilex US District Court of Appeals in New York.
Finally, I want to briefly comment on the recent favorable decision to chrome and Thats in the U S District Court of Appeals in New York.
Speaker 4: The court affirmed that our settlement with Elysium is enforceable. We look forward to collecting the $2.5 million that Elysium owes, plus the terms of the settlement and putting this behind us.
A firm that our settlement with Elysium enforceable, we look forward to collecting the $2 $5 million that Elysium OS plus the terms of the settlement and putting this.
Find us.
At Chromebooks, where all true believers and are extremely passionate about bringing NR to consumers in innovative ways to benefit their lives.
Speaker 4: and are extremely passionate about bringing an art to consumers in innovative ways to benefit their life.
Speaker 4: The partnership with Zesty Paws, as I mentioned, is a start for our company to extend and are as a benefit beyond human sub-
The partnership with Zesty pause as I mentioned at the start for our company to extend than ours the benefit beyond humans supplementation.
Speaker 4: We also continue to have uncapped potential in NAD precursors beyond NR.
We also continue to have untapped potential in NAD precursors beyond NR.
Speaker 4: which are protected by Cromatus's Beats Intellectual Property Portfolio.
Which are protected by <unk> deep intellectual property portfolio.
Speaker 4: Some of these novel NAD precursors may have significant prophylactic and therapeutic value in the pharmaceutical.
Some of these novel NAD precursors may have significant prophylactic and therapeutic value in the pharmaceutical space.
Speaker 4: We will continue to use our position as the global authority in NAD science and as a trusted partner to researchers, regulatory authorities and world-class business partners.
And we will continue to use our position as the global authority in science and as a trusted partner to researchers regulatory authorities and world class business partners.
Speaker 4: rise innovation and improve as many lines as possible.
To drive innovation and improve as many lives as possible.
Speaker 4: certain R&D innovations have been in development for quite some time and they take a little bit longer to commercialize. We are excited as we look to the future.
While certain R&D innovations have been in development for quite some time and may take a little bit longer to commercialize we are excited as we look to the future. We look forward to sharing more details on future updates.
Speaker 4: I would now like to turn the call over to Brianna to discuss the court's results in more detail and then out to Q&A and closing rooms.
I would now like to turn the call over to Brianna to discuss the quarter's results in more detail and then after Q&A and closing remarks.
Anna.
Speaker 5: Thank you Rob. Now that we've covered the broader strategic landscape and operational overview, I'm excited to delve into the specifics of our third quarter financial results, which showcase our commitment to balance, top and bottom line growth and overall operation.
Thank you Rob now that we've covered the broader strategic landscape and operational overview and excited to delve into the specifics of our third quarter financial results, which showcase our commitment to balance top and bottom line growth and overall operational discipline.
Speaker 5: highlighting the key metrics of our third quarter performance. Chromodex delivered total net sales of 19.5 million, up 14%, robust growth margins of 61.4%. A reduction in overall operating expenses, and a net loss of only one-
Highlighting the key metrics of our third quarter performance <unk> delivered total net sales of $19 5 million up 14% robust gross margins of 61, 4% a reduction in overall operating expenses and a net loss of only $1 million.
Speaker 5: Additionally, our adjusted EBITDA, a non-GAP metric, was a positive 0.5 million, a 1.7 million improvement year over year.
Additionally, our adjusted EBITDA, a non-GAAP metric was a positive <unk> 5 million, a $1 7 million improvement year over year.
Speaker 5: Net sales are up 22% year to date with an adjusted EBITDA of .7 million and positive operating cash flow of 6.5 million.
Net sales were up 22% year to date with an adjusted EBITDA of $1 7 million and positive operating cash flow of $6 5 million.
Speaker 5: Our performance this quarter underscores a relentless pursuit of efficiency across the organization to position the business for sustainable growth and profitability.
Our performance this quarter underscores our relentless pursuit of efficiency across the organization.
The business for sustainable growth and profitability.
Speaker 5: The consistent results we have achieved speak to the resilience of our business model and we are proud of the progress we've made to date. With that, let's turn to the
The consistent results, we have achieved speak to the resilience of our business model and we are proud of the progress we've made to date.
With that let's turn to the third quarter financials in more detail.
Speaker 5: As I said, total net sales in the third quarter of 2023 were at 14% year over year, as compared to the third quarter of 2022. With a 19% increase in true niogen driven by 13% growth in e-commerce sales, fueled by continued growth on Amazon, including a strong performance on Prime Day, paired with 43% growth and combined Watson's and other B2B sales.
As I said total net sales in the third quarter of 2023 were up 14% year over year as compared to the third quarter of 2022 with a 19% increase in Shanghai adjourn driven by 13% growth in E. Commerce sales fueled by continued growth on Amazon, including a strong performance on Prime day paired with 43% growth in combined.
Watson's another BW sale.
Speaker 5: Watson sales were higher year over year as the COVID-19 and macroeconomic challenges abated, coupled with reorders for true nitrogen immune, following a positive initial launch response from consumers last quarter. We also benefited from sales to new partners like IHIRB and SHOPHQ, which were not in the prior year period.
Watson sales were higher year over year as the COVID-19, and macroeconomic challenges abated, coupled with Reorders for Trina agenda.
Following a positive initial launch response from consumers last quarter. We also benefited from sales to new partners like <unk> and shop, HQ, which were not in the prior year period.
Speaker 5: On that note, shop HQ's parent company, IMedia Brand, has successfully been acquired by IV Media, LL.
On that note shop, HQ parent company <unk> media brands.
That's really been acquired by IV media LLC.
Speaker 5: The new owner has conveyed an interest in sustaining a partnership with Chromadak and continues to purchase in the third and fourth quarter.
New owner has conveyed an interest in sustaining our partnership with <unk> and continues to purchase in the third and fourth quarter.
Speaker 5: We have formally asserted a claim for the past due amount, totaling approximately 930,000 in the Bankruptcy Court.
We have formally asserted a claim for the past due amount totaling approximately 930000.
Bankruptcy court.
Speaker 5: Given the uncertainty of the bankruptcy process and our assessment of collectibility, we placed a reserve on remaining balance of trade receivable with shop HQ this quarter, which was not material to our overall financial results.
Given the uncertainty of the bankruptcy process and our assessment of Collectibility, we placed a reserve on the remaining balance of trade receivable with shop HQ This quarter, which was not material to our overall financial results.
Speaker 5: We have now reserved the full $930,000 outstanding receivable.
Now reserved the full $930000 outstanding receivable.
Speaker 5: In the context of these developments, we are currently supplying to them only on prepayment terms to sustain the business and mitigate risk to Chromodex while negotiating with the new owner. As we navigate through this transition, the continued success of shop HQ's TV retail model for Trunyogen makes us optimistic about a continued partnership.
In the context of these developments we are currently supplying to them only on prepayment terms to sustain the business and mitigate risks to chromebooks, while negotiating with the new owner as.
As we navigate through this transition the continued success of shop HQ TV retail model for Ciena as Jim makes us optimistic about our continued partnership.
Speaker 5: The increased sales from our true nitrogen business were partially offset by lower nitrogen ingredient sales, down 21% year-over-year. As you may recall, our ingredient sales surged in the first half of the year due to the addition of new partners and continued sales from existing partners.
The increased sales for March for your nitrogen business were partially offset by lower nitrogen ingredient sales down 21% year over year as.
As you may recall, our ingredient sales surged in the first half of the year due to the addition of new partners and continued sales from existing partners.
Speaker 5: Year-to-date, nitrogen-ingredient sales were up 78% compared to the prior year, and we maintain a positive outlook for nitrogen-ingredient sales growth. Through full year 2023, despite some quarter to quarter variability. Of note, we face our most challenging ingredient sales comparison in the fourth quarter, since the prior year results included a $2 million upfront minimum purchase from NEP.
Year to date, <unk> ingredient sales were up 78% compared to the prior year and we maintain a positive outlook for <unk> ingredient sales grants for full year 2023, despite some quarter to quarter variability.
Of note, we faced our most challenging ingredient sales comparison in the fourth quarter since the prior year results included a $2 million upfront minimum purchase from Netflix.
Speaker 5: Gross margins increased by 160 basis points reaching 61.4%. Compared to 59.8% in the third quarter of 2022. The elevated gross margin in the quarter was primarily a result of higher overall sales, allowing us to more efficiently leverage fixed supply chain costs, including labor and other over.
Gross margins increased by 160 basis points, reaching 61, 4% compared to 59, 8% in the third quarter of 2022.
The elevated gross margin in the quarter was primarily a result of higher overall sales, allowing us to more efficiently leverage fixed supply chain costs.
Labor and other overhead.
Speaker 5: Additionally, we continue to drive cost savings across the supply chain through optimization efforts in shipping and procurement, as well as improvements in the OBS or CMS.
Additionally, we continue to drive cost savings across the supply chain optimization efforts in shipping and procurement as well as improvement in your boss with BMO.
Speaker 5: As Rob mentioned, selling and marketing expense as a percentage of net sales decreased to 31%. Improving 340 basis points compared to 34.4% in the third quarter of 2022.
As Rob mentioned, selling and marketing expense as a percentage of net sales decreased 31%, improving 340 basis points compared to 34, 4% in the third quarter of 2022.
Speaker 5: Research and development expense remains stable compared to the prior year quarter. However, there were few offsetting drives.
Research and development expense remained stable compared to the prior year quarter. However, there were two offsetting drivers.
Speaker 5: First, we had increased investments of approximately .4 million to support important R&D initiatives, which were largely offset by a .3 million dollar refund related to a discontinued R&D project.
First we had increased investments of approximately <unk> 4 million to support important R&D initiatives, which were largely offset by a $3 million refund related to a discontinued R&D projects we.
Speaker 5: We anticipate a further uptick in these R&D investments during the fourth quarter, as we ramp up R&D projects, paving the way for new commercial opportunities for Chromeics in 2024 and beyond.
We anticipate a further uptick in these R&D investments during the fourth quarter as we ramp up R&D projects paving the way for new commercial opportunities for chromebooks in 2024 and beyond.
Speaker 5: As reported, general administrative expense decreased 0.3 million compared to the prior year period. The reduction was primarily attributable to lower legal expense as well as lower severance and restructuring expense.
As reported general and administrative expense decreased $3 million compared to the prior year period. The reduction was primarily attributable to lower legal expense as well as lower severance and restructuring expense.
Speaker 5: For the third quarter of 2023, our operating loss was 1.1 million versus a $3.1 million loss in the third quarter of 2022. An improvement of $1.9 million, largely driven by higher net sales.
For the third quarter of 2023, our operating loss was $1 1 million versus a $3 $1 million loss in the third quarter of 2022, an improvement of $1 $9 million largely driven by higher net sales.
Speaker 5: The net loss attributable to common stockholders for the third quarter of 2023 was 1 million or a loss of 1 cent per share, consistent with the net loss of 1 million and a loss of 1 cent per share in the third quarter of 2022.
The net loss attributable to common stockholders for the third quarter of 2023 was 1 million or a loss of one cent per share consistent with the net loss of $1 million and a loss of <unk> <unk> per share in the third quarter of 2022.
Speaker 5: The prior year quarter included a one-time recognition in other income for the Employee Retention Tax Credit or ERT.
The prior year quarter included a onetime recognition in other income for the employee retention tax credit or <unk>. When the <unk> is excluded net loss improved $2 1 million, which highlights the clear fundamental improvement in profitability this quarter.
Speaker 5: When the ERTC has excluded, net loss improved 2.1 million, which highlights the clear fundamental improvement in profitability discord.
Speaker 5: Moving to the balance sheet and cash flow. Our balance sheet remains strong. We ended the quarter with 26.8 million in cash and no debt.
Moving to the balance sheet and cash flow our balance sheet remains strong we ended the quarter with $26 8 million in cash and no debt.
Speaker 5: For the nine months ended September 30th, 2023, Netcash provided by operations was 6.5 million, a significant turnaround from the $14.8 million cash outflow in the same period last year.
For the nine months ended September 32023, net cash provided by operations was $6 5 million a significant turnaround from the $14 8 million cash outflow in the same period last year.
Speaker 5: The difference year over year was largely driven by improvements in our net loss of 10.1 million. Pair of changes in working capital, primarily related to inventory and prepaid another asset, which provided positive impacts of 4.1 million and 3 million respectively year to day.
The difference year over year with largely driven by improvements in our net loss was $10 1 million paired with changes in working capital primarily related to inventory and prepaid and other assets, which provided positive impact of $4 1 million and $3 million respectively year to date.
Speaker 5: Recurring from cash flow year to date related to inventory, was the result of stronger self-reductor night in our e-commerce channels and the key partners, higher volume of night in ingredient sales, and more efficient production.
Our strengthened cash flow year to date related to inventory was the result of stronger sell through of <unk> and our ecommerce channel into key partners higher volume of Myogen ingredient sales and more efficient production management the change in prepaid and other assets is linked to the employee retention tax credit receivable booked in the prior year period coupled.
Speaker 5: The change in prepaid and other assets, the linked to the employee retention tax credit receivable booked in the prior year period, coupled with collections against this receivable balance in the current year. For the full year, we expect an increase in cash driven by reduced net loss and improvement in working capital. The trends in the fourth quarter may not be as strong as recent performance, as there is always quarterly variability in investments, inventory production and overall working capital.
Collections against this receivable balance in the current year for.
For the full year, we expect an increase in cash driven by reduced net loss and improvements in working capital the trends in the fourth quarter. It may not be as strong as recent performance. There is always quarterly variability and investment inventory production and overall working capital management.
Speaker 5: As it relates to our 2023 full year P&L outlook, detailed information on key profit and less metrics could be found in our earnings press release and accompanying side presentation. Overall, all key metrics remain consistent with last quarter's outlook, but we have narrowed our revenue projection as we close out the year.
As it relates to our 2023 full year P&L outlook detailed information on key profit metrics can be found in our earnings press release and accompanying slide presentation. Overall key metrics remain consistent with last quarter's outlook, but we have narrowed our revenue projection as we close out the year.
Speaker 5: And maintaining a conservative approach to our top line outlook, we now expect 14 to 16% revenue growth year over year, driven by our globally commerce business, steady growth from new and existing partnerships, upside realized from new partnerships in the first nine months of 2023, and realistic opportunities in the fourth quarter.
And maintaining a conservative approach to our top line outlook, we now expect 14% to 16% revenue growth year over year, driven by our global ecommerce business steady growth from new and existing partnerships upside realize from new partnerships in the first nine months of 2023 and realistic opportunity within the fourth quarter.
Speaker 5: This reflects a slight adjustment from our prior guidance of at least 15%, primarily to account for a slower recovery of our own website business. As we attempt to scale our spend from the low level last year, we'll maintain targeted efficiency.
This reflects a slight adjustment from our prior guidance of at least 15% primarily to account for a slower recovery of our own website.
We attempt to scale our spend from the low levels last year, while maintaining targeted efficiencies and.
Speaker 5: In addition, while we have a pipeline of new business development opportunities with partners, as well as an exciting new commercial opportunity of our own, this upside is taking longer to materialize, and is more likely to contribute to 2024 results.
In addition, while we have a pipeline of new business development opportunities with partners as well as an exciting new commercial opportunity of our own. This upside is taking longer to materialize and is more likely to contribute to 2024 results.
Speaker 5: As it relates to adjusted EBITDA, we remain committed to achieving sustainable profitability or balancing important strategic investments to drive growth.
As it relates to adjusted EBITDA, we remain committed to achieving sustainable profitability are balancing important strategic investments to drive growth.
Speaker 5: For the first nine months of the year, we sustained adjusted EBITAB break even or better each quarter and delivered positive $700,000 here today.
For the first nine months of the year, we sustained adjusted EBITDA breakeven or better each quarter and delivered positive $700000 year to date.
Speaker 5: Looking to the fourth quarter of 2023, we expect negative adjusted EBITDA as we continue to invest an important R&D initiative, as well as investments in our marketing team to position us for accelerated growth in 2024 and beyond. We anticipate that adjusted EBITDA will be close to break even on a full year base.
Looking to the fourth quarter of 2023, we expect negative adjusted EBITDA as we continue to invest in important R&D initiatives as well as investments in our marketing team to position us for accelerated growth in 2024 and beyond we anticipate that adjusted EBITDA will be close to breakeven on a full year basis.
Speaker 5: In summary, this quarter underscores the strength of our Rebellion Business Model with double digit net revenue growth over 60% growth margins and overall cost reductions as we emphasize increased efficiency.
In summary, this quarter underscores the strength of our resilient business model with double digit net revenue growth over 60% gross margin and overall cost reductions as we emphasized increased efficiency further and again highlights our capability of delivering cash flow breakeven, having done so for three consecutive quarters and our significantly improved.
Speaker 5: Further, it again highlights our capability of delivering cash-lip-break even, having done so for three consecutive quarters and are significantly improved cash position, with 26.8 million on our balance sheet and no debt. And truly inspired by our achievements in a short amount of time. I'm confident we can build upon this progress and unlock new revenue opportunities in 2024, which when coupled with new cost savings initiatives, we'll enable us to sustain positive, adjusted EBITDA. Operator, we are now...
Cash position with $26 8 million on our balance sheet and no debt I'm truly inspired by our achievements in a short amount of time I'm confident we can build upon this progress and unlock new revenue opportunities in 2025, which when coupled with new cost savings initiatives will enable us to sustain a positive adjusted EBITDA.
Operator, we are now ready to take questions.
Speaker 2: As a reminder to ask a question, simply press star followed by the number one on your telephone keypad. We'll be asked that you please limit yourself to one question and one follow-up. We'll pause for just a moment to compile the Q&A roster.
As a reminder to ask a question simply press star followed by the number one on your telephone keypad.
We ask that you please limit yourself to one question and one follow up we'll pause for just a moment to compile the Q&A roster.
Speaker 2: Our first question will come from the line of ROM, Silveradju with HCWaneRite. Please go ahead.
Our first question will come from the line of Ron <unk> with HC Wainwright. Please go ahead.
Speaker 6: Hi, thanks very much for taking my questions and congrats on all the progress on the quarter. Thank you, Ron. I wanted to have firstly about.
Alright, thanks, very much for taking my questions and congrats on all the progress on the quarter.
Thank you Ron I wanted to ask.
Firstly about.
Speaker 7: your top-line revenue guidance. And if you expect a, a, a meaningful increase, quarter over quarter with respect to the fourth quarter versus the third quarter, if you're already seeing trends that that would be the case. And then if you anticipate the quenchedal quarter over quarter revenue growth from here on in, or if we should continue to expect some seasonality to some degree, as we look ahead to 2024, you know, if you have any feelings on this.
Your topline revenue guidance and if you expect.
They are meaningful.
Increase quarter over quarter with respect to the fourth quarter versus the third quarter. If you are already seeing trends that that would be the case and then if you anticipate sequential quarter over quarter revenue growth from here on in or if we should continue to expect some seasonality to some degree.
As we look ahead to 2024, if you have any feelings on that.
Yes.
Speaker 5: Thanks from yeah, so in plight in our guidance, I think you probably get to the range of revenues, which is what you're looking at, which does imply a fourth quarter sequential up chick. There's a couple things that drive that seasonally, as you pointed out, nitrogen ingredient is typically higher in the fourth quarter.
Thanks, Tom Yeah, so implied in our guidance I think you'd probably get to the range of revenues, which is what you are looking at which does imply a fourth quarter sequential uptick yes, theres a couple of things that drive that seasonally as you pointed out <unk> ingredient is typically higher in the fourth quarter. So we're expecting that trend to <unk>.
Speaker 5: So we're expecting, you know, that trend to continue some of our longer term partners in relative to the third of note year over year. The reason the growth rate guide is not as strong is the two million upfront from Nestle. So that would impact year over year, but you were asking sequentially key commerce, you know, as always continues to be a steady source of performance for us.
Continue some of our longer term partners in relative to the third of note year over year. The reason the growth rate guide is not as strong as the $2 million upfront from Nestle, so that would impact year over year, but you were asking sequentially E. Commerce as always continues to be a steady source of performance for us.
Speaker 8: the website taking a bit longer to turn the trend. Amazon's growing nicely and we are looking to build upon that, you know, going into the third quarter and into 2024.
Websites, taking a bit longer to turn to try and Amazon is growing nicely and we are looking to build upon that going into the third quarter and into 2024 and 2024, a bit early and looking at quarterly commentary and we will give you our fulsome outlook in March we do see some building blocks we touch.
Speaker 8: In 2024, a bit early in looking at quarterly commentary, and we'll give you our full-semout look in March. We do see some building blocks. We touched on new commercial opportunities, new partnerships, taking a bit longer that can ladder up to some acceleration and growth on a full-year basis.
On new commercial opportunities new partnerships, taking a bit longer that can ladder up to some acceleration in growth on a full year basis quarterly that seasonality does tend to play out a little bit for us, but more so it's about when we have newer partnerships that are ramping and timing of new new ingredient partnerships as an example, or <unk> in it.
Can be lumpy quarter to quarter on that part of the business like we've seen this year.
I don't know if you wanted to add the last few years. The last few years. The first quarter has been our strong quarter.
Speaker 7: Got it. And then just very quickly, you know, you mentioned moving into the companion animal space, the veterinary space, so to speak, you know, particularly on the aging side. And I was just wondering if you could contextualize the potential market opportunity there for the Nige and Brand, as well as whether you expect this to be either kind of primarily focused on K9 exclusively focused on K9 or broadly speaking across multiple companion animal categories.
Got it and then just very quickly you mentioned moving into the companion animal space.
The veterinary space, so to speak, particularly on the agent side and I was just wondering if you could contextualize the potential market opportunity there.
For the <unk> brand as well as whether you expect this to be either a kind of primarily focused on canine exclusively focused on canine or broadly speaking across multiple companion animal categories.
Speaker 4: We do expect it to go broader than just K9. We think the global supplement space for pets is approaching $2 billion, but growing rapidly. One of the fastest growing segments of the supplement space.
We do expect it to go broader than just canine.
We think the global supplement space for pets is approaching $2 billion, but growing rapidly.
One of the fastest growing segments of the supplement space.
Speaker 4: We do expect to have our own brands in the marketplace. Perhaps next year.
We do expect to have our own brands in the marketplace.
Perhaps next year.
Speaker 4: And they've gotten, Zestie Paz has gotten off to a terrific start. They've already placed the second order.
And they've gotten zesty pause has gotten off to a terrific start they've already placed the second order.
Thank you so much.
Speaker 9: Your next question comes from the line of Mitch Panero with stirred event. Please go ahead. I just wanted to follow up on the guidance. So for the fourth quarter.
Sure. Your next question comes from the line of Mitch Pinheiro with Sturtevant. Please go ahead.
Hey.
Just wanted to follow up on the guidance.
For the fourth quarter.
Speaker 9: So what a year of your basis, however, it's gonna be flat.
So on a year over year basis, however, it's going to be flat.
Speaker 9: And, you know, it looks like, you know, is it just simply, you know, maybe a tougher comparison against Watson's last year and the ingredient businesses, any concerns around e-commerce?
And it looks like.
Is it just simply.
Maybe.
Tougher comparison against Watson is last year in the ingredient businesses.
Any any any.
Concerns around e-commerce.
Growth rates.
Speaker 8: Yes, it is a tougher comparison on ingredient with Nestle, that 2 million last year of the comm.
Yes. It is a tougher comparison on ingredient with nationally that $2 million last year the comp.
Speaker 4: I do not watch it, but it's not really. That was a one time large purchase in the fourth quarter of last year.
Hi, it's not watson's internationally.
A one time large purchase in the fourth quarter of last year.
Speaker 4: No, it can commerce looks very strong.
No Ken Commerce looks very e-commerce looks very strong for us.
Speaker 9: Yeah, I mean, when I look at the efficiency, you know, it's not a perfect look, but, you know, your efficiency's been growing for the last...
Yes.
When I look at like the efficiency.
A perfect look but your efficiency has been growing for the last.
Speaker 9: you know, four or five quarters, you're marketing, you know, spend with drives you're totally commerce. And I just, a little confused why you call out that your website is, you know, having a tougher turn than Amazon, you can just elaborate.
No.
Four or five quarters.
Your marketing spend what drives your total ecommerce and I just I'm a little confused.
Why you call out that your web site.
Is having a tough return than than Amazon.
Great.
Speaker 4: We've put many more, much more resources over the last two years into Amazon than we have our own website, Shopify.
Uh huh.
We've put many more much more resources over the last two years into Amazon then we have our own website shopify.
Speaker 4: So Amazon has actually become more efficient than Shopify over the last couple of years, but we've begun to turn that around. And what we are now doing is putting more of our resources into Shopify and we expect to be Shopify to be a more significant engine for growth for us in the future. And when I say Shopify, I'm referring to our website.
So Amazon has actually become more efficient then shopify.
Over the last couple of years, but we've begun to turn that around.
What we are now doing is putting more of our resources into shopify, and we expect to be shopify to be a more significant engine for growth for us in the future and when I say shopify im referring to our web site.
Than Amazon.
Speaker 4: So the team, we're building the team, we're putting more advertising revenues into it or optimizing the site. We see it as an opportunity.
So.
Team that we're building the team, we're putting more advertising revenues Intuit, we're optimizing the site.
We see it as an opportunity and I know, we've said that before.
Speaker 4: So that's what we mean when we say it's taking a little bit longer, but we are seeing some significant progress in important KPIs performance metrics in the website.
So that's what we mean when we say, it's taking a little bit longer but we are seeing some significant some significant progress in important kpis performance metrics in the web site.
Speaker 9: Okay, and then just one more question, just on Watson's. Can you talk a little bit more about Watson's in terms of how many stores...
Okay and then just one more question just wanted Watkins.
Can you talk a little bit more about Watkins.
In terms of like how.
How many stores.
Speaker 9: We're in and then, are there plans to expand beyond the Hong Kong, Singapore, Taiwan area in 2024?
We are in and then.
Are there plans to expand beyond the Hong Kong, Singapore, Taiwan area in.
In 2024.
Speaker 4: They are considering two additional territories, but they have not committed to it yet, so we don't.
They are considering.
Two additional territories, but they have not committed to it yet so we don't know.
Speaker 9: But given, you know, it seems like they're pretty happy with the product is what's the, you know, what's sort of the gating factor for further store growth?
But given it seems like they are pretty happy with the product.
What's sort of the gating factor for further store growth.
Speaker 4: It has to do with the structure of Watson's as a company. These are independently operated businesses.
It has to do with the structure of Watson's as a company. These are independently operated businesses. So it's not really centralized.
Speaker 4: separate countries. I think more realistic would be expansion within the existing stores of expanded product offerings, which they are interested in doing. One equestrian rich form of
The separate countries I think more realistic would be expansion within the existing stores of expanded product offerings, which they are interested in doing.
Okay.
Alright, well. Thank you I appreciate the question.
Thank you thanks Mitch.
Speaker 2: Your next question will come from the line at the JP Mark with Farmhouse Equity Research. Please go ahead.
Your next question will come from the line of JP, Mark with farmhouse equity research. Please go ahead.
Hi, Robyn.
Speaker 10: Um, question for you about the true Nigem Pro product which I was delighted to see you had recently launched and wanted to know How do what your expectations are for the rollout of that and I saw that you had it's been certified for sport by the NSF International That are you kind of leading with MLB and NHL? Hoping that they'll kind of be using the product or is that just incident?
Question for you about the <unk> pro product, which I was delighted to see you had recently launched and wanted to know kind of what your expectations are for the rollout of that and I saw that you had it's been certified for sport by the NSF International are you kind of leading with MLB NHL.
So hoping that they'll be.
Using the product or is that just incidental.
Speaker 4: No, it's not incidental. There are many professional athletes that take true knives in today, as you probably know. And there are several teams that give it out to each of their players. And they're giving out a thousand milligolds.
No. It's not incidental there are many professional athletes to take Tonight and today as you probably know.
And there are several teams that give it out to each of their players and they're giving out a 1000 milligrams.
Speaker 4: There are also most of the studies that get published if you've seen our, our on a thousand milligrams.
There are also most of the studies that get published if you've seen our own 1000 milligrams and then we all take 1000 milligrams.
Speaker 4: So we thought we'd make 1,000 milligrams available to the general consumer since that's what the experts are taking, that's what the research shows and that's why we launched the Prada.
So we thought we'd make 1000 milligrams available to the general consumer since that's what the experts are taking that's what the research shows and that's why we launched the product.
Speaker 10: And is that going to be going out through this one follow up question through the channels, risk positions and clinics? Is that sort of the main product of the selling to them? Or are you doing that? Yes. Yes, it is.
And is that going to be going out through this one follow up question to the channels with physicians and clinics is that sort of the main product can be selling to them or are you already doing that yet.
Yes. It is.
Okay, Alright, thank you very much.
Thank you.
Okay.
Speaker 2: Our final question will come from the line of Matt Dane with Tiet and Capital Management. Please go ahead.
Our final question will come from the line of Matt Dane with Titan Capital Management. Please go ahead.
Speaker 11: Thank you. Wanted to ask a little bit more about your website to you.
Thank you.
Wanted to ask a little bit more about your website, you mentioned, Rob that youre starting to see some of the key performance indicators turned the corner I was curious.
Speaker 11: I was curious, so with those initial signs, what did serve your expectation for when that's really going to play out and start driving the sales growth?
With with those initial signs what it sort of your expectation for when that's really going to play out and to start driving the sales growth that you expect out of your your own website.
Speaker 4: First question, what are the key indicators? So our conversion rate is actually extremely high on our website.
First question what are the key indicators. So our conversion rate is actually extremely high on our website.
Speaker 4: but the amount of traffic needs to increase.
But the amount of traffic.
The amount of traffic needs to increase.
Speaker 4: Now part of the reason why the conversion rate is so high is because we've spent months now optimizing it, targeting cohort groups and targeting the messaging. So it is working. But what it needs to do is scale.
Now part of the reason why the conversion rate is so high is because we've spent months now optimizing it targeting cohort groups and targeting the messaging. So it is working.
It needs to do is scale.
Speaker 4: I expect it to scale. I'd like to say the first quarter.
I expect it to scale.
I'd like to say the first quarter.
Speaker 4: Hopefully by the first quarter we'll see some significant growth in the website sale.
Hopefully by the first quarter, we will see some significant growth in the website sales.
Speaker 11: Also did want to ask about the net.
Okay. That's helpful. Also did want to ask about the <unk> launch.
Speaker 11: You may have mentioned this, I missed it. When did they launch their first product?
You May have mentioned this and I missed it when did they launched their first product.
Speaker 11: And then what is your expectations around additional product launch insights and what can you share around?
And then what is your expectations around additional product launch and sites.
Can you share around that.
Speaker 4: They have multiple brands at Nestle. They launched with one of their brands called Soulgar, which is their very, very high end dietary supplement brand. They launched it two weeks ago. We don't know how they're doing yet. They seem very enthusiastic.
They have multiple brands at Nestle.
<unk> launched with one of their brands called <unk>, which is there are very very high end.
Dietary supplement brand launched it two weeks ago, we don't know how theyre doing yet they seem very enthusiastic.
Speaker 4: I believe they also launched another high end brand pure encapsulations launched the product as well. That's mostly a healthcare practitioner channel. There also has some consumer distribution.
I believe they also launched another high end brand pure encapsulation has launched the product as well Thats, mostly AC health care practitioner channel, but also has some consumer distribution.
Speaker 11: And we think they have, and they've launched that. And we think they have plans to launch on another very high end brand of theirs, vital proteins.
And we think they have and they have launched that and we think they have plans to launch.
Another very high end brand if theres vital proteins.
Right.
Okay.
Okay. No that's helpful. Thank you.
Thank you.
Sure.
With that I'll hand, the call back to Briana for closing remarks.
Speaker 8: Thank you Regina, there will be a replay of this call beginning at 4.30 pm Pacific time today. The replay number is 1, 800, 770, 2030, and the conference ID is 412, 6168. Thank you everyone for joining us today and for your continued support of Chromadoc.
Thank you Regina there'll be a replay of this call beginning at 430 P. M Pacific time today. The replay number is one 870 702030 and the conference I'd is four.
Our one to 6168, thank you everyone for joining us today and for your continued support of <unk>.
Speaker 2: This will conclude today's meeting. We thank you again all for joining. You may now disconnect.
This will conclude today's meeting we thank you again all for joining you may now disconnect.
Speaker 12: Please wait, the conference will begin shortly.
Please wait the conference will begin shortly.
Yes.
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