Source: ChromaDex Corporation
ET

ChromaDex Reports Third Quarter 2017 Financial Results

Company Reports Third Quarter 2017 Revenue of $6.1 Million, Up 55% Compared to Last Year -
- Continued Progress on Building a Consumer Products Platform Around TRU NIAGEN-

IRVINE, Calif., Nov. 09, 2017 (GLOBE NEWSWIRE) -- ChromaDex Corp. (NASDAQ:CDXC), a science-based, fully integrated nutraceutical company devoted to extending human healthspan, announced today the financial results for the quarter ended September 30, 2017.

Frank Jaksch, Jr., CEO and co-founder of ChromaDex commented, “The science continues to build and we are now well positioned with cash on our balance sheet to execute our growth strategy.”

“Six months into our strategic shift, we are doing better than expected,” said Rob Fried, President and Chief Strategy Officer of ChromaDex. “Our revenue growth in the quarter was led by sales of TRU NIAGEN."

Results of operations for the three months ended September 30, 2017

For the three months ended September 30, 2017, ChromaDex reported net sales of $6.1 million from continuing operations, which was up 55% as compared to $3.9 million for the third quarter of 2016. For the quarter, net sales of NIAGEN® related revenues were $4.5 million, which represented 73% of third quarter net sales.

Gross profit improved in the third quarter of 2017 to 47.9%, as compared to 47.3% for the same period in 2016. We experienced slightly better gross margins due to the positive impact of NIAGEN® related sales, which we anticipate continuing.

Operating expenses were $6.1 million, as compared to $2.8 million for the third quarter of 2016, as we made incremental investments of $3.3 million in sales and marketing, research and development, and general and administrative expense to support revenue growth.

The net loss from continuing operations attributable to common shareholders was $3.2 million, as compared to $2.3 million for the third quarter of 2016, as we also made investments in the third quarter of 2017 to accelerate our future growth trajectory. Loss per share from continuing operations for the third quarter of 2017 was ($0.07). Looking forward, we expect to continue to invest ahead of growth to capture the global opportunity for NIAGEN®

Adjusted EBITDA, a non-GAAP measure, was $2.9 million for the third quarter of 2017, compared to adjusted EBITDA of ($0.6) million for the third quarter of 2016. The Basic and Diluted Adjusted EBITDA per share for the third quarter of 2017 was $0.06 versus ($0.02) for the third quarter of 2016.

We also ended the quarter with a solid balance sheet with quarter-end cash of $24 million.  

In the third quarter of 2017, ChromaDex completed the sale of its operating assets that were related to ChromaDex’s quality verification program testing and analytical chemistry business for food and food related products. As result of the sale, ChromaDex posted income of $5.4 million from discontinued operations or $0.12 per share.

Recent Company highlights include:


Investor Conference Call

             
ChromaDex management will host an investor conference call to discuss the year end results and provide a general business update on Thursday, Nov. 9, at 4:30 p.m. ET.

Participants should call in at least 10 minutes prior to the call. The dial-in information is as follows:

U.S. Toll-Free Number:    (866) 327-8118
International Dial-In Number:    (678) 509-7526
Conference ID:    2486749
Conference ID:    https://edge.media-server.com/m6/p/h4svziad
      

The earnings press release, accompanying financial exhibits and webcast replay will all be available on the Investor Relations section of the Company website, www.chromadex.com.

About Non-GAAP Financial Measures

ChromaDex’s non-GAAP financial measures exclude interest, tax, depreciation, amortization and share-based compensation. ChromaDex used these non-GAAP measures when evaluating its financial results as well as for internal resource management, planning and forecasting purposes. These non-GAAP measures should not be viewed in isolation from or as a substitute for ChromaDex’s financial results in accordance with GAAP. A reconciliation of GAAP to non-GAAP measures is attached to this press release.

About ChromaDex:

ChromaDex discovers, acquires, develops and commercializes patented and proprietary ingredient technologies that address the dietary supplement, food, beverage, skin care and pharmaceutical markets. In addition to our ingredient technologies unit, we also have business units focused on natural product fine chemicals (known as "phytochemicals"), and product regulatory and safety consulting. As a result of our relationships with leading universities and research institutions, we are able to discover and license early stage, IP-backed ingredient technologies. We then utilize our in-house research and development laboratory, regulatory and safety consulting teams to develop commercially viable ingredients. Our ingredient portfolio, including NIAGEN® nicotinamide riboside; pTeroPure® pterostilbene; PURENERGY®, a caffeine-pTeroPure® co-crystal; IMMULINA, a spirulina extract; and AnthOrigin®, anthocyanins derived from a domestically-produced, water-extracted purple corn husk, is backed with clinical and scientific research, as well as extensive IP protection.

Forward-Looking Statements:

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended including statements related to financial results, financial representations, the future performance of ChromaDex’s consumer product, whether ChromaDex has cash on its balance sheet to execute its growth strategy, whether gross profit will continue to improve, and whether ChromaDex will continue to invest to capture the global opportunity for NIAGEN®.  Statements that are not a description of historical facts constitute forward-looking statements and may often, but not always, be identified using such words as "expects", "anticipates", "intends", "estimates", "plans", "potential", "possible", "probable", "believes", "seeks", "may", "will", "should", "could" or the negative of such terms or other similar expressions. More detailed information about ChromaDex and the risk factors that may affect the realization of forward-looking statements is set forth in ChromaDex's Annual Report on Form 10-K for the fiscal year ended December 31, 2016, ChromaDex's Quarterly Reports on Form 10-Q and other filings submitted by ChromaDex to the SEC, copies of which may be obtained from the SEC's website at www.sec.gov. 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.

ChromaDex Investor Relations Contact:
Andrew Johnson, Director of Investor Relations
949-419-0288
andrewj@chromadex.com

ChromaDex Public Relations Contact:
Breah Ostendorf, Director of Marketing
949-537-4103
breaho@chromadex.com

   
   
ChromaDex Corporation and Subsidiaries  
   
Condensed Consolidated Statements of Operations  
For the Three Month Periods Ended September 30, 2017 and October 1, 2016
   
 Sep. 30, 2017Oct. 1, 2016
   
Sales, net$   6,084,690 $3,937,286 
Cost of sales   3,169,321  2,074,325 
   
Gross profit   2,915,369  1,862,961 
   
Operating expenses:  
Sales and marketing   1,103,157  286,941 
Research and development   1,040,561  772,799 
General and administrative   3,948,435  1,727,383 
Operating expenses   6,092,153  2,787,123 
   
Operating loss   (3,176,784) (924,162)
   
Nonoperating expense:  
Interest expense, net   (44,508) (2,260)
Nonoperating expenses   (44,508) (2,260)
   
Loss from continuing operations   (3,221,292) (926,422)
   
Loss before taxes from discontinued operations   (108,899) (31,121)
Gain on sale of discontinued operations   5,467,268  - 
Provision for taxes   -    3,153 
   
Income (loss) from discontinued operations, net   5,358,369  (27,968)
   
Net income (loss)$   2,137,077 $(954,390)
   
Basic earnings (loss) per common share:  
Loss from continuing operations$   (0.07)$(0.02)
Earnings (loss) from discontinued operations$   0.12 $(0.01)
   
Basic earnings (loss) per common share$   0.05 $(0.03)
   
Diluted earnings (loss) per common share:  
Loss from continuing operations$   (0.07)$(0.02)
Earnings (loss) from discontinued operations$   0.11 $(0.01)
   
Diluted earnings (loss) per common share$   0.04 $(0.03)
   
Basic weighted average common shares outstanding   47,065,009  37,868,672 
   
Diluted weighted average common shares outstanding   47,556,697  37,868,672 
   
See Notes to Condensed Consolidated Financial Statements in Part I of ChromaDex's Quarterly Report
on Form 10-Q filed with Securities and Exchange Commission on November 9, 2017. 

 

ChromaDex Corporation and Subsidiaries  
   
Condensed Consolidated Balance Sheets  
September 30, 2017 and December 31, 2016  
   
 Sep. 30, 2017Dec. 31, 2016
Assets  
   
Current Assets  
Cash$   23,999,633 $1,642,429 
Trade receivables, net of allowances of $0.5 million and $1.1 million, respectively;  
   Receivables from related party: $1.5 million and $0, respectively   4,919,768  5,852,030 
Inventories   6,615,245  7,912,630 
Prepaid expenses and other assets   724,388  311,539 
Current assets held for sale   -  18,315 
Total current assets   36,259,034  15,736,943 
   
Leasehold Improvements and Equipment, net   2,690,527  1,778,171 
Deposits   392,342  377,532 
Receivable held at escrow   750,000  - 
Intangible assets, net   1,709,609  486,226 
Longterm investment   -  20,318 
Noncurrent assets held for sale   -  1,352,878 
   
Total assets$   41,801,512 $19,752,068 
   
Liabilities and Stockholders' Equity  
   
Current Liabilities  
Accounts payable$   4,346,700 $5,978,288 
Accrued expenses   2,129,583  2,170,172 
Current maturities of capital lease obligations   190,892  255,461 
Customer deposits and other   321,119  389,010 
Deferred rent, current   120,894  76,219 
Due to officer   100,000  - 
Total current liabilities   7,209,188  8,869,150 
   
Capital lease obligations, less current maturities   360,748  343,589 
Deferred rent, less current   493,735  380,205 
Noncurrent liabilities held for sale   -    184,766 
   
Total liabilities   8,063,671  9,777,710 
   
Commitments and contingencies  
   
Stockholders' Equity  
Common stock, $.001 par value; authorized 150,000,000 shares;  
   issued and outstanding September 30, 2017 47,650,252 shares and  
   December 31, 2016 37,544,531 shares   47,650  37,545 
Additional paid-in capital   81,469,567  55,160,387 
Accumulated deficit   (47,779,376) (45,223,574)
Total stockholders' equity   33,737,841  9,974,358 
   
Total liabilities and stockholders' equity$   41,801,512 $19,752,068 
   
See Notes to Condensed Consolidated Financial Statements in Part I of ChromaDex's Quarterly Report 
on Form 10-Q filed with Securities and Exchange Commission on November 9, 2017. 
   

 

           
Condensed Consolidated Statements of Operations (Unaudited)  Effects of Charges associated with Interest, Tax, Depreciation,   Condensed Consolidated Statements of Operations, Adjusted EBITDA
 (US GAAP)   Amortization and Share-based Compensation Expense  Excluding Interest, Tax, Depreciation, Amortization and  
        Share-based Compensation (Non-GAAP Presentation)  
For the Three Month Periods Ended September 30, 2017 and October 1, 2016 For the Three Month Periods Ended September 30, 2017 and October 1, 2016 For the Three Month Periods Ended September 30, 2017 and October 1, 2016
           
 Q3 2017Q3 2016  Q3 2017Q3 2016  Q3 2017Q3 2016
           
Sales, net$6,084,690 $3,937,286  Sales$   -   $-  Sales$6,084,690 $3,937,286 
Cost of sales 3,169,321  2,074,325  Cost of sales (47,746) (8,066) Cost of sales 3,121,575  2,066,259 
           
Gross profit 2,915,369  1,862,961  Gross profit 47,746  8,066  Gross profit 2,963,115  1,871,027 
           
Operating expenses:   Operating expenses:   Operating expenses:  
Sales and marketing 1,103,157  286,941  Sales and marketing -    -  Sales and marketing 1,103,157  286,941 
Research and development 1,040,561  772,799  Research and development -    -  Research and development 1,040,561  772,799 
General and administrative 3,948,435  1,727,383  General and administrative (589,747) (303,039) General and administrative 3,358,688  1,424,344 
Operating expenses 6,092,153  2,787,123  Operating expenses (589,747) (303,039) Operating expenses 5,502,406  2,484,084 
           
Operating loss (3,176,784) (924,162) Operating income 637,493  311,105  Operating loss  (2,539,291) (613,057)
           
Nonoperating expense:   Nonoperating income:   Nonoperating expense:  
Interest expense, net (44,508) (2,260) Interest expense, net 44,508  2,260  Interest expense, net -  - 
Nonoperating expenses (44,508) (2,260) Nonoperating income 44,508  2,260  Nonoperating expense -  - 
           
Loss from continuing operations (3,221,292) (926,422) Income from continuing operations 682,001  313,365  Loss from continuing operations (2,539,291) (613,057)
           
Loss before taxes from discontinued operations (108,899) (31,121) Income before taxes from discontinued operations 48,978  69,590  Income (loss) before taxes from discontinued operations (59,921) 38,469 
Gain on sale of discontinued operations 5,467,268  -  Gain on sale of discontinued operations -  -  Gain on sale of discontinued operations 5,467,268  - 
Provision for taxes -  3,153  Provision for taxes -  (3,153) Provision for taxes -  - 
           
Income (loss) from discontinued operations, net 5,358,369  (27,968) Income from discontinued operations, net 48,978  66,437  Income from discontinued operations, net 5,407,347  38,469 
           
Net income (loss)$2,137,077   $(954,390) Effects of adjusted EBITDA$730,979 $379,802  Adjusted EBITDA$2,868,056 $(574,588)
           
Basic earnings (loss) per common share:   Basic earnings per common share:   Basic earnings (loss) per common share:  
Loss from continuing operations$(0.07)$(0.02) Earnings from continuing operations$0.01 $0.01  Loss from continuing operations$(0.05)$(0.02)
Earnings (loss) from discontinued operations$0.12 $(0.01) Earnings from discontinued operations$0.00 $0.00  Earnings from discontinued operations$0.11 $0.00 
           
Basic earnings (loss) per common share$0.05 $(0.03) Basic earnings per common share$0.02 $0.01  Basic earnings (loss) per common share$0.06 $(0.02)
           
Diluted earnings (loss) per common share:   Diluted earnings per common share:   Diluted earnings (loss) per common share:  
Loss from continuing operations$(0.07)$(0.02) Earnings from continuing operations$0.01 $0.01  Loss from continuing operations$(0.05)$(0.02)
Earnings (loss) from discontinued operations$0.11 $(0.01) Earnings from discontinued operations$0.00 $0.00  Earnings from discontinued operations$0.11 $0.00 
           
Diluted earnings (loss) per common share$0.04 $(0.03) Diluted earnings per common share$0.02 $0.01  Diluted earnings (loss) per common share$0.06 $(0.02)
           
Basic weighted average common shares outstanding 47,065,009  37,868,672  Basic weighted average common shares outstanding 47,065,009  37,868,672  Basic weighted average common shares outstanding 47,065,009  37,868,672 
           
Diluted weighted average common shares outstanding  47,556,697  37,868,672  Diluted weighted average common shares outstanding 47,556,697  37,868,672  Diluted weighted average common shares outstanding 47,556,697  37,868,672