Guardion Health Sciences, Inc. (Nasdaq: GHSI) (“Guardion” or the
“Company”), a clinical nutrition company that offers a portfolio of
science-based, clinically-supported products designed to support
the health needs of consumers, healthcare professionals and
providers and their patients, announced its financial results for
the three months ended March 31, 2023. The Company also
provided a corporate update to stockholders.
Financial and other highlights for the three
months ended March 31, 2023 include the following (all common share
and per share amounts shown below have been adjusted to reflect the
1-for-50 reverse stock split effective January 6, 2023):
-
Total revenue was $3,185,689 for the three months ended March 31,
2023, as compared to $2,384,619 for the three months ended March
31, 2022, an increase of $801,070 or 33.6%. The increase in total
revenue was driven by increased sales of the Viactiv product line,
which accounted for approximately 97% of the Company’s total
revenue for the three months ended March 31, 2023.
-
Gross profit was $1,335,302 for the three months ended March 31,
2023, as compared to $1,096,457 for the three months ended March
31, 2022, an increase of $238,845 or 21.8%. The increase in gross
profit was primarily attributable to an increase in sales from the
Viactiv product line.
-
Gross margin for the three months ended March 31, 2023 was 41.9%,
as compared to 46.0% for the three months ended March 31, 2022.
Gross margin decreased by 4.1 percentage points or 8.9% in 2023 as
compared to 2022 because of increased transportation, fulfillment
and third-party logistics costs.
-
Total operating expenses for the three months ended March 31, 2023
were $2,799,309, as compared to $3,716,505 for the three months
ended March 31, 2022, a decrease of $917,196 or 24.7%.
-
Loss from operations for the three months ended March 31, 2023
decreased to $(1,464,007), as compared to $(2,620,048) for the
three months ended March 31, 2022, a reduction of $1,156,041 or
44.1%.
-
As a result of the aforementioned factors, and the non-cash gain
(loss) from the change in fair value of the warrant derivative
liability of $1,898,100 and $(2,682,500) for the three months ended
March 31, 2023 and 2022, respectively, net income was $533,091 for
the three months ended March 31, 2023, as compared to a net loss of
$(5,300,987) for the three months ended March 31, 2022.
-
Basic and diluted net income (loss) for the three months ended
March 31, 2023 was net income of $0.42 per share, as compared to a
net loss of $(6.77) per share for the three months ended March 31,
2022, based on 1,267,340 weighted average common shares outstanding
in 2023 and 783,018 weighted average common shares outstanding in
2022.
-
Cash used in operations for the three months ended March 31, 2023
was $1,879,210, as compared to $2,226,473 for the three months
ended March 31, 2022.
-
The Company had unrestricted cash and cash equivalents of
$8,774,626 as of March 31, 2023.
-
During the three months ended March 31, 2023, the Company redeemed
for cash all of the outstanding shares of Series C convertible
redeemable preferred stock and Series D redeemable preferred stock
that were issued and outstanding at December 31, 2022.
-
On January 24, 2023, the Company received a letter from The Nasdaq
Stock Market LLC stating that the Company had regained compliance
with the minimum bid price requirement of $1.00 per share for
continued listing on The Nasdaq Capital Market.
Bret Scholtes, Guardion’s President and Chief
Executive Officer, commented, “We are continuing our efforts in
2023 to build a stronger clinical nutrition company. We believe
that the operating improvements achieved during the first quarter
of 2023 reflect our continuing focus developing the Viactiv brand.
Our immediate focus is on increasing sales and improving gross
margin, while also reducing major cost categories and streamlining
operations.
“We believe that our ability to maximize
stockholder value requires that we continue to build a solid
corporate foundation and demonstrate growth and commercial success
on top of that foundation, with the objective of reaching operating
profitability.. In that regard, wee have taken a number of steps
during the last two years to strengthen our corporate foundation,
including acquiring Viactiv, winding down and reevaluating Vector
Vision, hiring key team members, launching a new product,
strengthening our eCommerce capabilities, moving our corporate
headquarters from California to Texas, and streamlining operations.
We will continue to be guided by our three primary objectives,
which are demonstrating commercial success, strengthening our
commercial engine and strengthening our clinical nutrition
strategy. “Despite this progress, we continue to
believe that the Company remains undervalued in the public market,
specifically with regard to the clinical nutrition platform and the
brand that we are building. We are continuing to work closely with
Alantra, LLC (“Alantra”), our exclusive financial advisor, to
implement the previously-announced strategic review to solicit and
evaluate alternatives to maximize stockholder value in the
near-term. Among other alternatives, this review could include a
sale of the Company or the Viactiv brand, or a merger, acquisition,
reverse acquisition, or other strategic transaction. We are
continuing this process and will provide updates to our
stockholders as developments warrant.
“Finally, we believe that our cash position, the
market position of the Viactiv product line, and our current
operating business strategy provide us with a viable platform from
which to continue our efforts to further grow operations, improve
financial performance, and maximize stockholder value,” concluded
Mr. Scholtes.
Financial Results
Additional information with respect to the
Company’s business, operations and financial condition as of and
for the three months ended March 31, 2023 is contained in the
Company’s Quarterly Report on Form 10-Q for the quarterly period
ended March 31, 2023, which has been filed with the U.S. Securities
and Exchange Commission (the “SEC”) at www.sec.gov.
About Guardion Health Sciences,
Inc.
Guardion Health Sciences, Inc. (Nasdaq: GHSI),
is a clinical nutrition company that offers a portfolio of
science-based, clinically supported products designed to support
the health needs of consumers, healthcare professionals and
providers and their patients. Information and risk factors with
respect to Guardion and its business may be obtained in the
Company’s filings with the SEC at www.sec.gov.
Forward-Looking Statement
Disclaimer
With the exception of the historical information
contained in this news release, the matters described herein may
contain “forward-looking statements” within the meaning of Section
27A of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act of 1934, as amended. These
forward-looking statements contain information about our
expectations, beliefs, plans or intentions regarding our product
development and commercialization efforts, research and development
efforts, business, financial condition, results of operations,
strategies or prospects, and other similar matters. Statements
preceded by, followed by or that otherwise include the words
“believes,” “expects,” “anticipates,” “intends,” “projects,”
“estimates,” “plans,” “hopes” and similar expressions or future or
conditional verbs such as “will,” “should,” “would,” “may” and
“could” are generally forward-looking in nature and not historical
facts, although not all forward-looking statements include the
foregoing.
These statements are based on management’s
current expectations and assumptions about future events, which are
inherently subject to uncertainties, risks and changes in
circumstances that are difficult to predict, and involve unknown
risks and uncertainties that may individually or materially impact
the matters discussed herein for a variety of reasons that are
outside the control of the Company, including, but not limited to,
the Company’s ability to raise sufficient financing to fund its
business plan, the impact of the Company’s exploration of strategic
alternatives, any replacement and integration of new management
team members, the implementation of new financial, management,
accounting and business software systems, the identification and
integration of possible acquisition targets and suitors, the impact
of the Covid-19 pandemic, supply chain disruptions, inflation and a
potential recession on the Company’s business, operations and the
economy in general, the Company’s ability to successfully develop
and commercialize its proprietary products and technologies, and
the Company’s ability to maintain compliance with Nasdaq’s
continued listing requirements.
Readers are cautioned not to place undue
reliance on these forward-looking statements, as actual results
could differ materially from those described in the forward-looking
statements contained herein. Readers are urged to read the risk
factors set forth in the Company’s filings with the SEC, which are
available at the SEC’s website (www.sec.gov). The Company disclaims
any intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
Investor Relations Contact:
CORE IRScott Arnold516-222-2560scotta@coreir.com
Media Relations Contact:Jules AbrahamDirector
of Public RelationsCORE IR917-885-7378julesa@coreir.com
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