— Delivered
— Closed on
— Won 2024 Cosmetics and Toiletries Allē Award Finished Formula Prestige Category
“We also added much needed breathing room in terms of capital and feel that we have the right financing in place to set us up for a strong 2024. We’re looking at
“Aligned with the process changes, we brought on an experienced Buyer to join our Purchasing Manager who, along with our VP of Operations, have made major improvements to our supply chain process and operations management efforts,” added Cureton.
2023 Q4 Financial Information
Fourth Quarter and Full Year 2023 Financial Highlights
Revenue for the fourth quarter was
- Revenue for the full year was
$37.3 million , which was the same for 2022. - Additional capital was secured with a
$6 million financing package announced inMarch 2024 .
For the full year of 2023:
- Solésence revenue was
$25.2million , up 9% from$23.1 million in 2022. - Personal Care Ingredients revenue was
$9.3 million , down 17% from$11.1 million in 2022. - Advanced Materials revenue was
$2.8 million , down 9% from$3.1 million in 2022. - Net loss for the quarter was
$2.1 million in 2023, compared to$2.0 million for Q4 of 2022. - Net loss for the full year 2023 was
$4.4 million , or$0.09 per share, compared to$2.6 million , or$0.05 per share, for 2022. - The largest part of the 2024 loss was driven by inefficiencies and supply chain issues in Q4, and
$1.3 million in legal fees relating to litigation. We have seen improvement in our operations already in Q1 of 2024, as well as lower litigation costs in Q4 that we expect to remain lower as we work toward a positive resolution.
Select Operational Highlights
Solésence Beauty Science Continues History of Winning Major Beauty Industry Awards
- In
March 2024 , Solésence market-ready product Soft Glow 50+ featuring Kleair™ won the 2024 Cosmetics & Toiletries Allē Awards in the Finished Formulas – Prestige Category. - In 2023,
Nanophase and Solésence Beauty Science were named in Fast Company’s World’s Most Innovative Companies for 2023, positioning us as No. 2 in the Beauty category. - Market-ready product, Natural Glow Face Oil SPF 40+ featuring Kleair™ and Bloom™, was named as the winner of the prestigious 2023 Cosmopack Award for Formulation for the second year in a row. In 2022, the Company took home the same award for their Multi-Cultural Magic SPF 50+ Featuring Kleair™.
- Solésence Beauty Science won the 2023 BeautyMatter NEXT Award for Best Contract Manufacturer in
October 2023 . - Solésence Beauty Science was named winner of the 22nd Annual Chicago Innovation Awards in
November 2023 .
Operations and Manufacturing Capabilities Expanded in 2023 and major upgrades in progress for 2024 for increased efficiency, throughput, and cost savings.
- Experienced Buyer joined the team in Q1 2024, in addition to the Purchasing Manager and VP of Operations who joined in Q4 and Q2 2023, respectively.
- In-house micro-testing labs are under construction, and full validation is planned for summer 2024.
- Continued expansion and automation of our fill and assembly capacity.
- Manufacturing consolidation process started, with wet processing moving to the same location as fill and assembly, expected to be completed in late summer 2024.
Followed Jankowski, “We expect
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FINANCIAL RESULTS AND NON-GAAP INFORMATION
Use of Non-GAAP Financial Information
About
About Solésence Beauty Science
Solésence, www.solesence.com, a wholly owned subsidiary of
Forward-Looking Statements
This press release contains words such as “expects,” “shall,” “will,” “believes,” and similar expressions that are intended to identify forward-looking statements within the meaning of the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Such statements in this announcement are made based on the Company’s current beliefs, known events and circumstances at the time of publication, and as such, are subject in the future to unforeseen risks and uncertainties that could cause the Company’s results of operations, performance, and achievements to differ materially from current expectations expressed in, or implied by, these forward-looking statements. These risks and uncertainties include, without limitation, the following: a decision by a customer to cancel a purchase order or supply agreement in light of the Company’s dependence on a limited number of key customers; uncertain demand for, and acceptance of, the Company’s engineered materials, ingredients, and fully formulated products; the Company’s manufacturing capacity and product mix flexibility in light of customer demand; the Company’s limited marketing experience; changes in development and distribution relationships; the impact of competitive products and technologies; the Company’s dependence on patents and protection of proprietary information; the resolution of litigation in which the Company may become involved; the impact of any potential new government regulations that could be difficult to respond to or too costly to comply with while remaining financially viable; the ability of the Company to maintain an appropriate electronic trading venue; and other factors described in the Company’s Form 10-K filed
Investor Relations Contact:
Phone: (630) 771-6736
CONSOLIDATED BALANCE SHEETS | |||||||||
As of | |||||||||
2023 | 2022 | ||||||||
(in thousands except share and per share data) | |||||||||
ASSETS | |||||||||
Current assets: | |||||||||
Cash | $ | 1,722 | $ | 2,186 | |||||
Trade accounts receivable, less allowance for doubtful accounts of | |||||||||
for | 3,467 | 4,734 | |||||||
Inventories, net | 10,031 | 8,839 | |||||||
Prepaid expenses and other current assets | 1,088 | 866 | |||||||
Total current assets | 16,308 | 16,625 | |||||||
Equipment and leasehold improvements, net | 8,668 | 7,949 | |||||||
Operating leases, right of use | 7,907 | 8,978 | |||||||
Other assets, net | 4 | 6 | |||||||
Total assets | $ | 32,887 | $ | 33,558 | |||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||
Current liabilities: | |||||||||
Line of credit, related party | $ | 7,810 | $ | 7,282 | |||||
Current portion of debt, related parties | 2,000 | - | |||||||
Current portion of operating lease obligations | 1,297 | - | |||||||
Accounts payable | 6,260 | 6,363 | |||||||
Current portion of deferred revenue | 2,353 | 2,167 | |||||||
Accrued expenses | 869 | 1,023 | |||||||
Total current liabilities | 20,589 | 16,835 | |||||||
Long-term portion of finance lease obligations | - | - | |||||||
Long-term portion of operating lease obligations | 9,152 | 9,823 | |||||||
Long-term debt, related party | 1,000 | 1,000 | |||||||
Long-term portion of deferred revenue | - | 21 | |||||||
Asset retirement obligations | 238 | 230 | |||||||
Total long-term liabilities | 10,390 | 11,074 | |||||||
Contingent liabilities | |||||||||
Stockholders' equity: | |||||||||
Preferred stock, | |||||||||
no shares issued and outstanding | - | - | |||||||
Common stock, | |||||||||
49,627,254 and 49,320,680 shares issued and outstanding on | |||||||||
and | 496 | 493 | |||||||
Additional paid-in capital | 106,069 | 105,226 | |||||||
Accumulated deficit | (104,657 | ) | (100,070 | ) | |||||
Total stockholders' equity | 1,908 | 5,649 | |||||||
Total liabilities and shareholders' equity | $ | 32,887 | $ | 33,558 | |||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||||||
Three months ended | Years ended | ||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||
(in thousands except share and per share data) | |||||||||||||||||||||
Revenue: | |||||||||||||||||||||
Product revenue | $ | 7,716 | $ | 8,216 | $ | 36,641 | $ | 36,731 | |||||||||||||
Other revenue | 295 | 45 | 656 | 586 | |||||||||||||||||
Net revenue | 8,011 | 8,261 | 37,297 | 37,317 | |||||||||||||||||
Operating expense: | |||||||||||||||||||||
Cost of revenue | 7,540 | 7,298 | 29,472 | 28,957 | |||||||||||||||||
Gross profit | 471 | 963 | 7,825 | 8,360 | |||||||||||||||||
Research and development expense | 785 | 727 | 3,837 | 3,037 | |||||||||||||||||
Selling, general and administrative expense | 1,583 | 2,088 | 7,534 | 7,581 | |||||||||||||||||
Income/(loss) from operations | (1,897 | ) | (1,852 | ) | (3,546 | ) | (2,258 | ) | |||||||||||||
Interest expense | (225 | ) | (150 | ) | (838 | ) | (382 | ) | |||||||||||||
Other income, net | - | - | - | - | |||||||||||||||||
Income/(loss) before provision for income taxes | (2,122 | ) | (2,002 | ) | (4,384 | ) | (2,640 | ) | |||||||||||||
Provision for income taxes | - | (17 | ) | - | (17 | ) | |||||||||||||||
Net income/(loss) | $ | (2,122 | ) | $ | (1,985 | ) | $ | (4,384 | ) | $ | (2,623 | ) | |||||||||
Net income per share-basic | $ | (0.04 | ) | $ | (0.04 | ) | $ | (0.09 | ) | $ | (0.05 | ) | |||||||||
Weighted average number of basic shares outstanding | 49,627,254 | 49,260,295 | 49,556,305 | 49,117,000 | |||||||||||||||||
Net income per share-diluted | $ | (0.04 | ) | $ | (0.04 | ) | $ | (0.09 | ) | $ | (0.05 | ) | |||||||||
Weighted average number of diluted shares outstanding | 49,627,254 | 49,260,295 | 49,556,305 | 49,117,000 | |||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS - EXPANDED SCHEDULE | |||||||||||||||||||||
Three months ended | Years ended | ||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||
(in thousands except share and per share data) | |||||||||||||||||||||
Revenue: | |||||||||||||||||||||
Product revenue, net | $ | 7,716 | $ | 8,216 | $ | 36,641 | $ | 36,731 | |||||||||||||
Other revenue | 295 | 45 | 656 | 586 | |||||||||||||||||
Net revenue | 8,011 | 8,261 | 37,297 | 37,317 | |||||||||||||||||
Operating expense: | |||||||||||||||||||||
Cost of revenue detail: | |||||||||||||||||||||
Depreciation | 205 | 138 | 686 | 503 | |||||||||||||||||
Non-Cash equity compensation | 26 | 24 | 111 | 95 | |||||||||||||||||
Other costs of revenue | 7,309 | 7,136 | 28,675 | 28,359 | |||||||||||||||||
Cost of revenue | 7,540 | 7,298 | 29,472 | 28,957 | |||||||||||||||||
Gross profit | 471 | 963 | 7,825 | 8,360 | |||||||||||||||||
Research and development expense detail: | |||||||||||||||||||||
Depreciation | 5 | 8 | 26 | 34 | |||||||||||||||||
Non-Cash equity compensation | 40 | 40 | 176 | 162 | |||||||||||||||||
Other research and development expense | 740 | 679 | 3,635 | 2,841 | |||||||||||||||||
Research and development expense | 785 | 727 | 3,837 | 3,037 | |||||||||||||||||
Depreciation and amortization | 8 | 8 | 30 | 30 | |||||||||||||||||
Non-Cash equity compensation | 114 | 106 | 488 | 366 | |||||||||||||||||
Other selling, general and administrative expense | 1,461 | 1,974 | 7,016 | 7,185 | |||||||||||||||||
Selling, general and administrative expense | 1,583 | 2,088 | 7,534 | 7,581 | |||||||||||||||||
Income/(loss) from operations | (1,897 | ) | (1,852 | ) | (3,546 | ) | (2,258 | ) | |||||||||||||
Interest expense | (225 | ) | (150 | ) | (838 | ) | (382 | ) | |||||||||||||
Other income, net | - | - | - | - | |||||||||||||||||
Income/(loss) before provision for income taxes | (2,122 | ) | (2,002 | ) | (4,384 | ) | (2,640 | ) | |||||||||||||
Provision for income taxes | - | (17 | ) | - | (17 | ) | |||||||||||||||
Net income/(loss) | $ | (2,122 | ) | $ | (1,985 | ) | $ | (4,384 | ) | $ | (2,623 | ) | |||||||||
Non-GAAP Disclosure (see note regarding Non-GAAP disclosures): | |||||||||||||||||||||
Addback Interest, net | 225 | 150 | 838 | 382 | |||||||||||||||||
Addback Depreciation/Amortization | 218 | 154 | 742 | 567 | |||||||||||||||||
Addback Non-Cash Equity Compensation | 180 | 170 | 775 | 623 | |||||||||||||||||
Addback Other Income, net | - | - | - | - | |||||||||||||||||
Addback Provision for Income Taxes | - | (17 | ) | - | (17 | ) | |||||||||||||||
Adjusted EBITDA | $ | (1,499 | ) | $ | (1,528 | ) | $ | (2,029 | ) | $ | (1,068 | ) | |||||||||
Source:
2024 GlobeNewswire, Inc., source