ChromaDex Reports 32% Increase in First Quarter Revenue as Ingredient Sales Grow 97%
09 May 2014 --- ChromaDex Corp., an innovative natural products company that provides proprietary, ingredients and science-based solutions to the dietary supplement, food and beverage, animal health, cosmetic and pharmaceutical industries, announced the financial results for the quarter ended March 29, 2014.
For the three months ended March 29, 2014, the Company reported net sales of $3,074,138, an increase of approximately 32% as compared to $2,334,566 for the three months ended March 30, 2013. This increase was largely due to increased sales in the proprietary ingredient segment which grew to $1,136,309, an increase of 97% as compared to ingredient sales of $577,953 in Q1 2013. The net loss attributable to common stock holders for Q1 2014 was $1,848,016 or ($0.02) per share as compared to a net loss of $1,424,072 or ($0.02) per share for Q1 2013. The non-cash, stock-based compensation expense related to stock options and other stock-based compensation in Q1 2014 was $999,661. Excluding non-cash, share-based compensation expense, which is a "non-GAAP measure," would have the effect of decreasing the Company's net loss for the three months ended March 29, 2014 to $848,355. As of March 29, 2014, cash, cash equivalents and marketable securities totaled approximately $1,924,538.
Frank Jaksch, Jr., CEO and co-founder of ChromaDex, commented, "Over the past three years, we have spent considerable capital and resources to commercialize what we believe are valuable, patented ingredient technologies - such as our NIAGEN nicotinamide riboside and PURENERGY caffeine alternative. The 97% increase in ingredient sales was largely a result of the first order we received from 5LINX for NIAGEN and PURENERGY. Based on visibility of sales activity from both our existing customers and our business development pipeline, we anticipate steady growth in our ingredient segment to continue for the foreseeable future."
Jaksch continued, "Media outlets are starting to highlight peer reviewed research studies from esteemed institutions on the potential health benefits of NAD+ precursors, such as nicotinamide riboside. We expect new research will continue to be published which will further validate the health benefits of NR. We plan to add to that research by beginning our first clinical study on NIAGEN™ in the second quarter."
Recent Company highlights include:
- In January 2014, the Company announced it entered into a four year ingredient supply and brand licensing agreement valued at approximately $62 million, with 5LINX, one of the largest and fastest-growing direct marketing companies in the world. 5LINX was granted marketing rights for ChromaDex's patented NIAGEN nicotinamide riboside ingredient for use in dietary supplements exclusively in the network marketing sales channel in the United States, Canada and Philippines. Under the terms of the agreement, 5LINX must purchase from ChromaDex $2.1 million of NIAGEN in 2014, and an aggregate of $46 million of NIAGEN from 2015 through 2017. 5LINX was also granted marketing rights for ChromaDex's recently launched patented PURENERGY for use in dietary supplements, with select exclusively in the network marketing sales channel in the U.S., Canada and Philippines. Under the exclusive network marketing channel agreement, 5LINX must purchase from ChromaDex $520,000 of PURENERGY in 2014 and an aggregate of $14 million of PURENERGY from 2015 through 2017. The first shipment pursuant to these agreements was made in Q1 5LINX plans on launching several new innovative health and wellness products that feature ChromaDex's NIAGEN nicotinamide riboside and patented PURENERGY ingredients at its upcoming international event in Atlantic City, NJ. The event will be held May 14-17, 2014 and is expected to be attended by thousands of 5LINX sales associates.
- In January 2014, the Company announced the appointment of former Nestle executive, Steve Allen as an independent director. Allen retired from Nestle in December 2009 after a 30-year career in sales, marketing and general management.
- In the first quarter, the Company entered into separate material transfer agreements with Groningen Biomolecular Sciences & Biotechnology Institute and University of Copenhagen, whereby ChromaDex will provide each with quantities of its NIAGEN nicotinamide riboside for research purposes.
- In April 2014, the Company entered into a joint collaboration agreement with the Brazilian Biosciences National Laboratory to evaluate the Company's natural product libraries.
- In April 2014, a collaboration formed by the University of Mississippi's Division of Technology Management, the USDA Agricultural Research Service's Natural Products Utilization Research Unit and ChromaDex won a national award for excellence in technology transfer. The three organizations have won a Federal Laboratory Consortium 2014 Excellence in Technology Transfer Award for their work to develop, study and bring to market pterostilbene, a compound found in blueberries, grapes and other small fruits. In studies, pterostilbene has demonstrated promise for improving cardiovascular health, glucose levels and cognitive function.
