Financial Performance - Third-quarter net revenue was $3.5 million, an 8% increase from Q2 2024 but a 6% decrease compared to Q3 2023[2] - The company achieved a net income of $0.2 million, compared to a net loss of $0.2 million in the same period last year[2] - Adjusted EBITDA for the quarter was $295,000, a significant increase from $11,000 in Q3 2023[9] - Gross margins improved to 61% in Q3 2024, up from 59% in Q3 2023, due to better terms with the largest supplier[5] - Selling, general and administrative expenses decreased to $1.7 million from $2.1 million in the same period last year, attributed to lower stock compensation and bonus accruals[7] Cash Flow and Assets - Cash and cash equivalents as of September 30, 2024, were $2.5 million, down from $4.3 million at the end of 2023, primarily due to operating losses in the first half of 2024[10] - Total current assets decreased to $7,356,000 from $8,405,000, a decline of approximately 12.5%[22] - Cash and cash equivalents decreased to $2,457,000 from $4,307,000, a decline of approximately 42.9%[22] - Accounts receivable increased to $1,691,000 from $1,496,000, an increase of approximately 13.0%[22] - Inventory increased to $3,099,000 from $2,470,000, an increase of approximately 25.4%[22] Liabilities and Equity - Total liabilities decreased to $2,212,000 from $3,503,000, a decline of approximately 37.0%[22] - Current liabilities decreased to $1,058,000 from $2,113,000, a decline of approximately 50.0%[22] - Lease liabilities decreased to $1,154,000 from $1,390,000, a decline of approximately 17.0%[22] - Total stockholders' equity decreased to $8,174,000 from $8,358,000, a decline of approximately 2.2%[22] - Accumulated deficit increased to $(144,681,000) from $(144,406,000) indicating a deeper loss[22] - Additional paid-in capital increased slightly to $152,844,000 from $152,754,000[22] Operational Focus - The South Central region underperformed, leading to a reorganization, despite overall solid growth in most sales regions[3] - The company is preparing to launch digital support for filter installation and is enhancing service capabilities to improve customer compliance with filter change schedules[3] - Nephros is focused on maintaining positive cash flow and profitability while managing expenses and improving operational efficiency[19] Research and Development - Research and development expenses remained stable at $0.2 million for both Q3 2024 and Q3 2023[6]

Core Viewpoint - Nephros, Inc. is set to announce its third-quarter financial results on November 7, 2024, and will host a conference call to discuss these results [1]. Group 1: Financial Results Announcement - Nephros will file its third-quarter financial results after market close on November 7, 2024 [1]. - A conference call will take place on the same day at 4:30 PM ET for discussing the financial results [1]. - Participants can join the call using specific domestic and international access numbers [1]. Group 2: Audio Archive and Replay - An audio archive of the conference call will be available shortly after the call on the Nephros Investor Relations page [2]. - A replay of the call can be accessed until November 14, 2024, using designated numbers and a replay access code [2]. Group 3: Company Overview - Nephros is a leading provider of filtration products for medical, commercial, and industrial markets [3]. - The company utilizes advanced hollow-fiber technology and effective commercial filter media to ensure high water quality by protecting against waterborne contaminants [3].

Core Viewpoint - Nephros, Inc. has effectively responded to recent hurricanes in the southeastern United States by providing essential water filtration solutions to healthcare and nursing facilities, ensuring safe water access during recovery efforts [1][3]. Group 1: Company Response and Capabilities - Nephros has leveraged its disaster response capabilities to deliver crucial water filtration products to affected healthcare facilities, emphasizing the importance of clean water in patient care [2][3]. - The company has shipped a significant number of filters rapidly, responding after hours and ensuring next-day delivery to federal and local disaster response partners [3]. - Nephros' filtration solutions have been deployed across multiple states, including Florida and North Carolina, where they provided immediate protection against water contamination [3]. Group 2: Product Importance and Commitment - The company's filtration products are vital for ensuring purified water for various critical applications, including drinking, dialysis, surgical operations, and general facility hygiene [3]. - Nephros is committed to providing high-quality water filtration solutions in both routine and crisis situations, highlighting the speed and efficiency of its team in maintaining service continuity [3][4]. - The advanced hollow-fiber technology and effective commercial filter media used in Nephros products help protect against waterborne contaminants, ensuring high water quality [4].

Financial Data and Key Metrics Changes - In Q2 2024, net revenue was $3.25 million, down 8% compared to Q2 2023, primarily due to low contributions from emergency response revenue [9][10] - Gross margin remained strong at 59%, flat year-over-year, but decreased from 62% in Q1 2024 due to increased shipping expenses and reserves for slow-moving products [10] - Net loss improved by 33% to $289,000 in Q2 2024 from a loss of $433,000 in Q2 2023, attributed to reduced SG&A expenses [10][11] - For the first half of 2024, net loss decreased 38% to $458,000 from $739,000 in the prior year [11] Business Line Data and Key Metrics Changes - Non-emergency response business increased by 8% year-over-year in Q2 2024, while emergency response business saw a 92% decline [6][9] - Excluding emergency response revenue, sales increased by 10% in the first half of 2024 [10] Market Data and Key Metrics Changes - The company achieved the highest number of active customer sites ever, with a 15% increase over the previous year, totaling 1,384 active accounts by the end of Q2 2024 [6][19] Company Strategy and Development Direction - The company is focusing on long-term growth initiatives, including the expansion of digital tools like the filter tracking app to enhance customer engagement [7][8] - Nephros is strategically positioning itself to capitalize on growth opportunities in sectors beyond hospitals, such as dental practices and endoscopy processing [8] Management's Comments on Operating Environment and Future Outlook - Management noted a decline in emergency response business due to reduced stringency in waterborne risk response, but anticipates potential recovery with upcoming regulatory changes [7][15] - The company remains committed to innovation and customer engagement while focusing on profitability and return on investment [12] Other Important Information - The balance sheet remains strong with a cash balance of approximately $3.1 million as of June 30, 2024, despite a decrease from $4.3 million at the end of 2023 [11] Q&A Session Summary Question: Can you elaborate on the reduced stringency for waterborne risk response? - Management identified that the Ohio Department of Health reduced testing due to system overload, which may lead to a return to higher emergency responses with upcoming regulatory changes [14][15] Question: Update on the filter tracker rollout? - The rollout faced initial issues but recent updates have improved functionality. Management believes the tracker will help increase reorder rates for filters [17][18] Question: Total number of active accounts at the end of Q2? - The total number of active accounts as of the end of Q2 2024 was 1,384 [19]

Core Viewpoint - Nephros, Inc. is set to announce its second-quarter financial results on August 8, 2024, and will host a conference call to discuss these results [1]. Group 1: Financial Results Announcement - The company will file its second-quarter financial results after market close on August 8, 2024 [1]. - A conference call will take place on the same day at 4:30 PM ET for discussion of the financial results [1]. - Participants can join the call using specific domestic and international access numbers [1]. Group 2: Audio Archive and Replay - An audio archive of the conference call will be available shortly after the call on the Nephros Investor Relations page [2]. - A replay of the call can be accessed until August 15, 2024, with specific access numbers and a replay access code provided [2]. Group 3: Company Overview - Nephros is focused on improving water safety through innovative filtration products and services for healthcare and commercial markets [3]. - The company emphasizes an integrated approach to water management, offering both proactive and emergency solutions [3].

Core Insights - Nephros, Inc. will file its second-quarter financial results on August 8, 2024, after market close and will host a conference call at 4:30 PM ET on the same day [1] - An audio archive of the conference call will be available shortly after the call on the Nephros Investor Relations page, with a replay accessible until August 15, 2024 [2] Company Overview - Nephros is focused on improving the human relationship with water through innovative and accessible technology, providing water filtration products and services [3] - The company serves both healthcare and commercial markets, offering proactive and emergency solutions for water management [3] Investor Relations - Key contacts for investor relations include Kirin Smith, President of PCG Advisory, Inc., and Robert Banks, CEO of Nephros, Inc. [4]

Financial Data and Key Metrics Changes - Nephros reported a net revenue of $3.5 million for Q1 2024, a 5% decrease compared to the same period in 2023, primarily due to a drop in emergency response orders [124][107] - The net loss for the quarter was $169,000, an improvement from a loss of $306,000 in the same period last year [107] - Gross margins increased to 62% from 57% year-over-year, driven by reduced shipping expenses and better supplier terms [7][55] Business Line Data and Key Metrics Changes - The programmatic business grew by 12% year-over-year, indicating strong performance despite the overall revenue decline [16][124] - Research and development expenses remained stable at $200,000 for both Q1 2024 and Q1 2023, while sales, general, and administrative expenses were also consistent at $2.1 million [7] Market Data and Key Metrics Changes - The healthcare industry is growing at a modest rate of 2-3%, while Nephros' programmatic business growth of 12% significantly outpaces this industry growth [59] - The company is expanding its target market to include schools, municipalities, and senior living centers, which traditionally do not have the same regulatory drivers as healthcare facilities [115][80] Company Strategy and Development Direction - Nephros is focusing on enhancing its digital capabilities, such as the online filter tracker, to improve customer experience and operational efficiency [5][135] - The company is exploring solutions for nano and microplastics (NMPs), leveraging its hollow-fiber technology to address health concerns related to these contaminants [6][105] - Future growth will depend on enhancing sales strategies, leveraging regulatory changes, and exploring new products [17] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by a stagnant healthcare market but expressed optimism about the company's ability to capture market share and grow its programmatic business [39][142] - The management team emphasized the importance of educating customers about the value of their products, especially in light of price pressures [93][98] Other Important Information - The cash balance as of March 31, 2024, was $3.6 million, down from $4.3 million at the end of 2023, with the company remaining debt-free [19] - Nephros is actively participating in trade shows and industry events to increase brand awareness and educate key decision-makers [123] Q&A Session Summary Question: What is the growth in programmatic sales reflective of? - Management indicated that the growth is a mix of expansion within existing partners and acquiring new clients, with a focus on maintaining customer relationships [110] Question: How is the online filter tracker performing? - The tracker is in the beta phase, and while it is too early to see significant results, initial feedback is positive regarding its potential to improve filter replacement rates [111][126] Question: What is the retention rate of customers? - The retention rate hovers around mid-90s to 94%, indicating strong customer satisfaction despite higher prices compared to competitors [93] Question: Are there any price pressures? - Management acknowledged price pressures but emphasized that the quality and performance of their products justify the premium pricing [74][93] Question: What are the future growth areas? - Nephros is looking to expand into sterile processing and other healthcare-related markets, driven by regulatory needs and customer inquiries [81][82]

Company Overview - The company develops and sells high-performance water solutions primarily for medical and commercial markets[74]. - The company has FDA 510(k) clearance for a portfolio of medical device products aimed at infection control in hospitals and dialysis centers[86][91]. - The company entered a new supply agreement in January 2023 with a partner to be the exclusive distributor for food, beverage, and hospitality industries[92]. - The company anticipates that future revenue from the commercial market could surpass its infection control revenue as demand for water safety management grows[94]. - The company plans to leverage value-added resellers (VARs) to expand access to target customers in both medical and commercial markets[80]. - The company has adopted a plan to wind down Specialty Renal Products, Inc. due to unsuccessful strategic partnership efforts and limited capital resources[77]. Medical Market Insights - Medical water filters, classified as ultrafilters, capture contaminants as small as 0.005 microns, minimizing exposure to various pathogens[75]. - In 2023, there are approximately 6,129 hospitals in the U.S. with around 920,000 beds, and over 34 million patients were admitted[84]. - The dialysis market includes approximately 7,100 clinics servicing around 500,000 patients annually, with over 100,000 hemodialysis machines in operation in the U.S.[90]. - The EndoPur ultrafilter is designed for large RO systems in dialysis clinics, providing a product life of up to 12 months[95]. Financial Performance - Total net revenue decreased by $175,000, or 4.7%, in Q1 2024 compared to Q1 2023, primarily due to reduced emergency response orders[100]. - Gross margin increased to 62% in Q1 2024 from 57% in Q1 2023, reflecting a 5 percentage point improvement driven by lower shipping expenses and better pricing terms[102]. - Selling, general and administrative expenses rose by $18,000, or 1%, mainly due to hiring a new CEO and CFO, offset by a one-time reversal of stock compensation expense of approximately $75,000[103]. - Research and development expenses decreased by approximately $27,000 due to the wind down of SRP in 2023[104]. - Interest income increased to approximately $25,000 in Q1 2024 from $12,000 in Q1 2023, representing a 108% increase[106]. - Net loss improved to $169,000 in Q1 2024 from $306,000 in Q1 2023, a reduction of 45%[100]. - Cash and cash equivalents decreased to $3,633,000 as of March 31, 2024, down from $4,307,000 as of December 31, 2023[109]. - Net cash used in operating activities was approximately $0.7 million in Q1 2024, compared to net cash provided of approximately $0.3 million in Q1 2023[112]. - The company had an accumulated deficit of $144.6 million as of March 31, 2024, indicating ongoing challenges in achieving profitability[109]. - Future liquidity sources will focus on the development, marketing, and sales of water filtration products[111].

Financial Performance - First-quarter net revenue was $3.5 million, a decrease of 5% compared to $3.7 million in the same period in 2023[4] - Net loss for the quarter was $0.2 million, improved from a net loss of $0.3 million in the same period last year[5] - Adjusted EBITDA for the quarter was a loss of $95,000, compared to a gain of $147,000 in Q1 2023[6] - Gross margins increased to 62%, up from 57% in the same period last year, driven by reduced shipping expenses and better supplier terms[7] - Cash and cash equivalents decreased to $3.6 million from $4.3 million as of December 31, 2023, primarily due to annual employee bonuses and inventory investment[10] - Total current assets decreased to $8.13 million from $8.41 million as of December 31, 2023[23] Business Growth - Programmatic business revenue grew by 12% year-over-year, indicating strong growth in the core business[3] Research and Development - Research and development expenses remained stable at $0.2 million for both quarters ended March 31, 2024, and March 31, 2023[9] - The company is developing an online filter tracker to enhance customer experience and manage filter replacements[3] - Nephros is exploring capabilities for nano and microplastic filtration, leveraging its technology to address water quality challenges[3]

Financial Performance - Total net revenues increased by 43% to $14.238 million for the year ended December 31, 2023, compared to $9.975 million in 2022[158] - Gross margin improved to 59% in 2023 from 47% in 2022, reflecting a return to target gross margins of 55%-60%[160] - Net loss attributable to Nephros, Inc. shareholders decreased by 79% to $1.575 million in 2023 from $7.382 million in 2022[158] Expenses - Research and development expenses decreased by 30% to $873,000 in 2023, primarily due to the wind down of Specialty Renal Products, Inc.[161] - Selling, general and administrative expenses rose by $1.3 million or 17% to $8.911 million, driven by increased bonuses and hiring of new executives[163] Cash Flow and Liquidity - Cash and cash equivalents increased to $4.307 million as of December 31, 2023, compared to $3.634 million in 2022[170] - Net cash provided by operating activities was $0.8 million in 2023, a $4.1 million improvement from net cash used of approximately $3.2 million in 2022[174] - The company had an accumulated deficit of $144.4 million as of December 31, 2023, with expectations of incurring additional operating losses until profitability is achieved[171] - Future liquidity sources will depend on market acceptance of products and the ability to effectively produce and sell them[173] Agreements and Commitments - Minimum annual aggregate purchases from Medica under the License and Supply Agreement were €3.8 million (approximately $4.1 million) for 2023[177]