NEXGEL has acquired all of the assets of Silly George for $400,000 in cash, $200,000 in NEXGEL common stock, and a 4-year net profit earn out. Under the terms of the agreement, management of Silly George will remain in place and inventory will be provided by the seller at cost and paid for after the sale of each unit. Acquisition further expands NEXGEL Health, Wellness, and Beauty consumer product portfolio Silly George is on a revenue run rate of approximately $2 million LANGHORNE, Pa., May 16, 2024 (GLOBE ...

Acquisition further expands NEXGEL Health, Wellness, and Beauty consumer product portfolio Silly George is on a revenue run rate of approximately $2 million LANGHORNE, Pa., May 16, 2024 (GLOBE NEWSWIRE) -- NEXGEL, Inc. ("NEXGEL" or the "Company") (NASDAQ: "NXGL"), a leading provider of ultra-gentle, high-water-content hydrogel products for healthcare and consumer applications, today announced the acquisition of Silly George, an international beauty company with specialty in eye and eyelash consumer products ...

Financial Data and Key Metrics Changes - Revenue for the first quarter of 2024 increased by 104% year-over-year to approximately $1.27 million, exceeding the guidance of $1.25 million [28] - Gross profit margin for Q1 2024 was approximately 22%, compared to a negative gross margin for the same period last year and an increase from 14.6% in Q4 2023 [29] - Net loss for Q1 2024 was $905,000, compared to a net loss of $807,000 in Q1 2023 [16] Business Line Data and Key Metrics Changes - Revenue from contract manufacturing increased by approximately 58%, while revenue from consumer branded products surged by 178% year-over-year [29] - The Kenkoderm product line contributed to revenue growth, marking the first full quarter of revenue contribution from six new products [36] Market Data and Key Metrics Changes - The company is preparing for a European market entry, with interest in Australia, the UK, and Nordic countries for its Hexagels product [18] - The company is also looking to distribute Kenkoderm in smaller Eastern European and Nordic countries [20] Company Strategy and Development Direction - The company is focused on capacity expansion in its Texas facility and is investing in state-of-the-art equipment to support increased demand [31] - Achieving MDR compliance is a priority for entering the European market, with costs associated with compliance expected to normalize in the second half of 2024 [38] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the cash runway to fund operations, with a cash balance of $2.4 million as of March 31, 2024 [6] - The company anticipates a reduction in expenses and a more normalized financial situation in the latter half of 2024 as facility expansion is completed and MDR compliance is achieved [38] Other Important Information - The company completed a registered direct offering for net proceeds of just under $1 million in February 2024 [6] - The company is working on an update to its Medigel retail website to facilitate cross-promotion with Kenkoderm products [8] Q&A Session Summary Question: Can you discuss the potential European launch and strategy? - The first product for Europe will be Class 1 medical devices, with expected self-certification after passing inspection scheduled for the end of May [18] - Interest exists for Hexagels in Australia, the UK, and Nordic countries, while SilverSeal, a Class 3 device, will not be cleared until Q4 at the earliest [19] Question: What are the differences in commercializing in Europe versus the U.S.? - Understanding the market is crucial, and the company is seeking distribution partners to navigate local marketing strategies effectively [21][22] Question: Will there be an FDA inspection required after capacity expansion? - FDA inspections are sporadic and typically occur only if issues arise; however, ISO inspections are regularly scheduled [41] Question: Will partners like AbbVie conduct inspections regarding the expansion? - Regular inspections by partners are expected, similar to the company's inspections of their facilities [42]

Revenue Performance - NEXGEL reported Q1 2024 revenue of $1.27 million, a 104% increase from $620,000 in Q1 2023[3] - Revenue growth was driven by contract manufacturing (58% increase) and consumer branded products (178% increase) year-over-year[2] Profitability and Expenses - Gross profit for Q1 2024 was $277,000, compared to a gross profit loss of $57,000 in Q1 2023, resulting in a gross profit margin of 21.9%[4] - Cost of revenues increased by 46.1% to $989,000 in Q1 2024, primarily due to new product line growth and increased compensation[5] - Selling, general and administrative expenses rose by 43.8% to $1.1 million, attributed to higher advertising, marketing, and consulting fees[6] - Research and development expenses decreased to $2,000 in Q1 2024 from $29,000 in Q1 2023[7] - NEXGEL's net loss for Q1 2024 was $905,000, compared to a net loss of $807,000 in Q1 2023[7] Cash Position and Future Plans - As of March 31, 2024, NEXGEL had a cash balance of $2.4 million, including approximately $1 million from a registered direct offering[8] - The company is nearing completion of a capacity expansion in Texas and preparing for product launches with Abbvie and others[2] - NEXGEL expects to launch its first batch of consumer branded products in Europe, pending final certifications[2]

Revenue and Profit Growth - Revenue for Q1 2024 increased by 104.2% to $1.266 million compared to $620 thousand in Q1 2023, driven by growth in contract manufacturing and branded products[152] - Gross profit for Q1 2024 was $277 thousand, a significant improvement from a gross loss of $57 thousand in Q1 2023, with gross profit margin improving to 21.9% from -9.2%[158] Cost and Expense Analysis - Cost of revenues increased by 46.1% to $989 thousand in Q1 2024, primarily due to revenue growth[159] - Selling, general and administrative expenses increased by 43.8% to $1.146 million in Q1 2024, driven by higher compensation, marketing, and professional fees[160] - Advertising and marketing expenses surged by 169.1% to $253 thousand in Q1 2024, reflecting increased investment in consumer branded products[163] - Research and development expenses decreased significantly to $2 thousand in Q1 2024 from $29 thousand in Q1 2023[166] Cash Flow and Financial Position - Net cash used in operating activities increased to $1.092 million in Q1 2024 from $709 thousand in Q1 2023[168] - Cash and cash equivalents decreased to $2.419 million at the end of Q1 2024 from $2.7 million at the end of 2023[168] - Current assets totaled $4,863 million and current liabilities totaled $2,483 million as of March 31, 2024, resulting in working capital of $2,380 million, a decrease from $2,503 million at December 31, 2023[171] - The company reported a loss from operations of $871 million and net proceeds of $946 million from the RDO, contributing to the change in working capital[171] Strategic Initiatives and Future Plans - The company expanded its product portfolio with the acquisition of the Kenkoderm skincare brand in December 2023 for $546.5 thousand, with potential additional earn-out payments based on 2024 performance[149] - The company formed a 50% joint venture in March 2023 for its converting and packaging business[148] - Management is exploring new product channel sales in consumer products, including cosmetics, athletic products, and proprietary medical devices, to expand the customer base and ensure financial stability[174] - The company believes it has sufficient capital to operate into 2025, with plans to grow its contract manufacturing business and develop a catalog of consumer products for online sales[175] - The company plans to develop proprietary medical devices and explore drug delivery programs, while also evaluating strategic initiatives such as acquisitions[175] - The company expects to continue incurring losses in the near term and may consider raising capital through equity or debt offerings to fund potential acquisitions[176] Dividend Policy and Capital Allocation - The company has no plans to declare or pay cash dividends in the foreseeable future, as all available funds will be used to finance business growth[172] Accounting and Valuation - As of March 31, 2024, the company had no off-balance sheet arrangements, including guarantee contracts or contingent obligations[178] - The company uses the Black-Scholes option valuation model to estimate the fair value of share-based compensation and warrant liabilities, with key inputs including expected volatility and risk-free interest rates[180][181][182] - The company's financial statements are prepared using critical accounting policies that require significant estimates and assumptions, which could materially impact results if actual outcomes differ[179]

Management will host a conference call at 4:30 P.M. ET on the same day LANGHORNE, Pa., May 09, 2024 (GLOBE NEWSWIRE) -- NEXGEL, Inc. ("NEXGEL" or the "Company") (NASDAQ: "NXGL"), a leading provider of medical and over-the-counter (OTC) products including ultra-gentle, high-water-content hydrogels for healthcare and consumer applications, today announced it will report its financial results for the first quarter 2024, after the market closes on May 13, 2024. Following the release of its financial results, th ...

Hydrogel Manufacturing and Capacity - The company's hydrogel manufacturing facility operates at approximately 10% capacity, with the potential to produce 1.4 billion square inches of product annually at full capacity[16] - The company's facilities are FDA-compliant and create a high barrier to entry for competitors in the hydrogel and consumer product business[16] - Hydrogel products manufactured by the company are generally classified as Class I exempt devices, exempt from FDA regulatory submissions[36] - The company maintains sufficient inventory of components and raw materials to prevent significant production disruptions[31] Consumer Products and Brands - The company launched its direct-to-consumer website, Medagel.com, in 2022 and added the Kenkoderm skincare brand in December 2023[17] - The company's consumer products include the MedaGel and LumaGel Beauty brands, targeting OTC remedies and beauty/cosmetic solutions, respectively[17] - The company launched its direct-to-consumer website, Medagel.com, in 2022 and expanded its consumer product brands to include MedaGel, LumaGel Beauty, and Kenkoderm[17] Medical Device Development and Strategy - The company's NEXDrape medical device is designed for patients with impaired skin and has undergone proof-of-concept studies, with plans to file a 510(k) submission with the FDA[21][22] - The company is developing NEXDerm, an adhesive tape for securing medical devices, which aims to offer advantages over Tegaderm™, including pain-free removal and increased infection prevention[23] - The company's medical device strategy focuses on licensing and partnering arrangements rather than commercialization due to high expenses[24] - The company's NEXDrape medical device is designed for patients with impaired skin, targeting a significant and growing incise surgical drape market currently led by 3M Healthcare[21] - NEXDrape has undergone one animal and two human cadaver proof-of-concept studies, with plans to file a 510(k) premarket submission with the FDA[22] - The company is developing NEXDerm, an adhesive tape designed to secure central lines and intravenous tubes, as a gentler alternative to 3M Healthcare's Tegaderm™[23] Custom and White Label Business - The company's custom and white label business allows customers to create their own hydrogel products, with customers paying a development fee to eliminate financial risk for the company[19] - The company's custom and white label business allows customers to create their own hydrogel products, eliminating financial risk for the company[19] Competition and Market Challenges - The company faces competition from larger players like Johnson & Johnson, Pfizer, and Procter & Gamble in the consumer products and medical device markets[28] Revenue and Customer Concentration - One major customer accounted for approximately 20% of revenue in 2023, down from 29% in 2022[34] - The company's contract manufacturing business relies on a major customer that accounted for 20% of revenue in 2023 and 29% in 2022[34] Research and Development - Research and development costs were $103 thousand in 2023, a significant decrease from $367 thousand in 2022[44] - Research and development costs for 2023 were $103 thousand, a decrease from $367 thousand in 2022[44] Employees and Facilities - The company has 19 full-time employees as of December 31, 2023, with 14 involved in manufacturing and regulatory matters[45] - The company leases approximately 16,500 square feet of office and manufacturing space in Langhorne, Pennsylvania, expiring in January 2031[46] - The company subleases approximately 6,200 square feet of a 12,000 square foot facility in Granbury, Texas, expiring in March 2028[46] - The company leases approximately 16,500 square feet of office and manufacturing space in Langhorne, Pennsylvania, expiring January 31, 2031[46] - The company subleases approximately 6,200 square feet of a 12,000 square foot facility in Granbury, Texas, expiring March 2028[46] Intellectual Property and Patents - The company filed for a patent on NEXDrape under the Patent Cooperation Treaty, providing protection in member nations[35] - The company holds an exclusive license to two patents covering a transdermal patch containing transcutol, effective for delivering lidocaine, expiring in April 2032[35] - The company filed for a patent on NEXDrape under the Patent Cooperation Treaty, providing protection in member nations[35] Regulatory Compliance and Risks - The company's facilities are subject to FDA compliance and cGMP regulations, with potential regulatory actions for non-compliance[37][38] - The company is compliant with cGMP requirements and registered as a device manufacturer and distributor with the FDA[39] - The company is subject to environmental regulations and has made significant investments to comply, but future costs remain uncertain[40] - Potential environmental liabilities could materially impact net income, financial condition, liquidity, or cash flow[41] - The company is compliant with federal and state anti-kickback, self-referral, and false claims laws, but violations could adversely affect stock price and operations[42] - The company is not currently aware of any material legal proceedings or claims[48] Financial and Reporting Status - The company is a smaller reporting company and is not required to disclose certain contractual obligations[50]

NEXGEL, Inc. (NASDAQ:NXGL) Q4 2023 Earnings Conference Call April 1, 2024 8:30 AM ET Company Participants Valter Pinto - Managing Director, KCSA Strategic Communications Adam Levy - Chief Executive Officer Adam Drapczuk - Chief Financial Officer Conference Call Participants William Odenthal - COVA Capital Naz Rahman - Maxim Group Operator Good morning. My name is Todd and I will be your conference operator today. At this time, I would like to welcome everyone to NEXGEL's Fourth Quarter and Full Year 2023 Ea ...

Exhibit 99.1 NEXGEL Reports Full Year 2023 Revenue of $4.1 Million, an Increase of 99.7% Year-Over-Year LANGHORNE, Pa. – April 1, 2024 – NEXGEL, Inc. ("NEXGEL" or the "Company") (NASDAQ: "NXGL"), a leading provider of ultra-gentle, high-water-content hydrogel products for healthcare and consumer applications, today announced its financial results for the fourth quarter and full year ended December 31, 2023. Adam Levy, NEXGEL's Chief Executive Officer, commented, "2023 was a record year for NEXGEL and transf ...

NEXGEL, Inc. (NASDAQ:NXGL) Q3 2023 Results Conference Call November 13, 2023 4:30 PM ET Company Participants Valter Pinto - MD, KCSA Strategic Communications Adam Levy - CEO Adam Drapczuk - CFO Conference Call Participants Naz Rahman - Maxim Group Operator Good afternoon. I will be your conference operator today. At this time, I would like to welcome everyone to NEXGEL's Third Quarter 2023 Earnings Conference Call. I will now turn the call over to Valter Pinto, Managing Director of KCSA Strategic Communicat ...