For the quarterly period ended June 30, 2023 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____ to _____ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (Exact name of registrant as specified in its charter) | Delaware | 23-2577138 | | --- | --- | | (State or other jurisdiction | (I.R.S. Employer | | of inc ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____ to _____ Commission file number 000-21617 ProPhase Labs, Inc. (Exact name of registrant as specified in its charter) | Delaware | 23-2577138 | | --- | --- | | (Sta ...

ProPhase Labs, Inc. (NASDAQ:PRPH) Q1 2023 Results Conference Call May 11, 2023 11:00 AM ET Company Participants Ted Karkus - CEO and Chairman Conference Call Participants Hunter Diamond - Diamond Equity Research Yi Chen - H.C. Wainwright Operator Good day, and welcome to the ProPhase Labs Inc. First Quarter 2023 Financial Results and Corporate Update Conference Call. All participants will be in listen only mode [Operator Instructions]. Please note this event is being recorded. I would now like to turn the ...

Financial Performance - As of December 31, 2022, the company had working capital of approximately $40.7 million, sufficient to support its businesses for at least the next twelve months[142]. - Revenues for the year ended December 31, 2022, increased to $122.647 million, up 55% from $79.042 million in 2021[383]. - Gross profit for 2022 was $70.654 million, representing a gross margin of approximately 57.6%, compared to $41.988 million in 2021[383]. - Net income for 2022 was $18.463 million, a significant increase from $6.273 million in 2021, reflecting a growth of 194%[389]. - Basic earnings per share rose to $1.17 in 2022, compared to $0.41 in 2021, indicating a substantial improvement in profitability[383]. - Cash flows from operating activities for 2022 were $28.551 million, a turnaround from a cash outflow of $13.619 million in 2021[389]. - The company reported a total comprehensive income of $19.395 million for 2022, compared to $6.109 million in 2021, reflecting overall financial growth[383]. - Total operating expenses for 2022 were $47.059 million, up from $32.187 million in 2021, primarily driven by increased diagnostic and administrative expenses[383]. - Stockholders' equity increased to $63.631 million in 2022, up from $58.628 million in 2021, reflecting a stronger equity position[381]. - Total liabilities decreased to $24.017 million in 2022 from $30.667 million in 2021, indicating improved financial health[381]. Business Operations - The company launched its diagnostic service business in October 2020, and its future profitability will depend on the demand for COVID-19 testing and other diagnostic services[172]. - The company acquired Nebula, a personal genomics company, in August 2021, and is integrating its whole genome sequencing services with existing clinical diagnostic services[140]. - The company formed ProPhase Biopharma, Inc. in March 2022 for the licensing, development, and commercialization of novel drugs and dietary supplements[141]. - The company operates two segments: diagnostic services and consumer products, with significant revenue growth attributed to the diagnostic services business line[403]. - The diagnostic services business has seen increased revenues due to demand for COVID-19 testing, primarily from government bodies and large corporations[405]. - The personal genomics business is influenced by demand for genetic sequencing products and regulatory compliance[407]. - The contracting manufacturing business is affected by seasonal demand, particularly during the cold season from September to March[408]. - The company actively pursues acquisition opportunities for technologies and products within and outside the consumer products industry[398]. Market Competition - The company faces significant competition in the lab diagnostic services market from major players like Quest Diagnostics and Laboratory Corporation of America, which have substantial resources[143]. - The personal genomics market has seen increased competition, with many companies entering the space, some with greater financial and technical resources[144]. - Three customers accounted for 53.3% of the company's revenues for the year ended December 31, 2022, with individual contributions of 23.5%, 17.9%, and 11.9%[183]. Regulatory and Compliance Risks - The company must comply with extensive federal, state, and local regulations, including CLIA and HIPAA, to avoid severe consequences that could materially affect its financial condition[184]. - The FDA's regulation of diagnostic products could lead to increased costs and potential fines, impacting the company's business operations[187]. - The company is required to comply with complex laws protecting the privacy and security of health information and personal data, with significant compliance costs[274]. - Noncompliance with privacy laws could result in criminal penalties, civil sanctions, and significant monetary penalties, adversely affecting financial performance[275]. - The California Consumer Privacy Act (CCPA) provides for fines of up to $7,500 per violation, requiring modifications to data processing practices and incurring substantial compliance costs[276]. Operational Challenges - Disruptions in the supply chain, including access to testing supplies and raw materials, could materially impact the company's operations and financial condition[149]. - The complexity of billing and collections for diagnostic tests poses risks, including long collection cycles and lower collection rates, which could adversely affect revenue[176]. - The company faces intense competition for skilled employees, which is critical for its product generation efforts, and failure to retain key personnel could adversely affect operations[169]. - The company must validate any new laboratories according to governmental standards before utilizing their services, which could impact workflow[206]. - Any significant disruption in the company's IT systems could harm its reputation and result in customer loss[207]. Future Outlook - The end of the COVID-19 national emergency on May 11, 2023, may significantly impact the demand for COVID-19 testing services and the company's ability to generate revenue from this segment[175]. - The company may require additional capital to support its growing diagnostic services and personal genomics business, but funding may not be available on acceptable terms[159]. - The personal genomics business's success depends on establishing a market presence and achieving economies of scale, which are critical for financial viability[200]. - The company is early in the development of its product candidates, with revenue generation not expected for several years, highlighting the uncertainty in commercialization[220]. - The success of product candidates depends on various factors, including regulatory approvals, market acceptance, and competition, which are uncertain[222]. Intellectual Property and Legal Risks - The patent position of the company is uncertain, and the ability to protect intellectual property may be compromised, affecting competitive advantage[257]. - The company may face substantial liability from third-party claims of intellectual property infringement, which could delay development efforts[261]. - Protecting and enforcing intellectual property rights could divert financial resources from other business objectives[265]. Acquisitions and Investments - In January 2023, the company acquired exclusive rights to the BE-Smart Esophageal Pre-Cancer Diagnostic Screening test, aimed at early detection of esophageal cancer[397]. - The company has made substantial investments in equipment, supplies, and personnel to support its diagnostic services[405].

ProPhase Labs, Inc. (NASDAQ:PRPH) Q4 2022 Earnings Conference Call March 28, 2023 11:00 AM ET Company Participants Ted Karkus - Chairman and Chief Executive Officer Conference Call Participants Yi Chen - H.C. Wainwright Hunter Diamond - Diamond Equity Research Patrick Patterson - Private Investor Fred McDonald - Private Investor Operator Hello and welcome to the ProPhase Labs Financial Results for the Year Ended December 31, 2022 Conference Call. [Operator Instructions] Please note this event is being recor ...

ProPhase Labs, Inc. (NASDAQ:PRPH) Q3 2022 Earnings Conference Call November 10, 2022 11:00 AM ET Company Participants Ted Karkus – Chairman and Chief Executive Officer Conference Call Participants Fred McDonald – Private Investor Yi Chen – H.C. Wainwright Dennis Waldman – Barrett Productions, LLC Patrick Patterson – Investor Operator Good morning, afternoon, evening, and welcome to the ProPhase Labs Third Quarter 2022 Financial Results Conference Call. All participants will be in listen-only mode. [Operator ...

Financial Performance - For the three months ended September 30, 2022, net revenue was $24.2 million, a significant increase from $9.5 million for the same period in 2021, driven by a $13.4 million increase in diagnostic services revenue [225]. - For the nine months ended September 30, 2022, net revenue reached $100.8 million, up from $33.9 million in the same period in 2021, primarily due to a $64.2 million increase in diagnostic services revenue [235]. - Net income for the three months ended September 30, 2022, was $1.0 million, or $0.06 per share, compared to a net loss of $4.0 million, or ($0.26) per share, in Q3 2021 [234]. - Net income for the nine months ended September 30, 2022, was $20.9 million, or $1.33 per share, compared to a net loss of $4.3 million, or ($0.29) per share, in 2021 [243]. - Adjusted EBITDA for the nine months ended September 30, 2022, was $35.5 million, compared to $1.6 million in 2021 [248]. Revenue and Testing Volume - Overall diagnostic testing volume increased from 62,000 tests in Q3 2021 to 113,000 tests in Q3 2022, with 49.4% of tests reimbursed by the HRSA uninsured program [225]. - Approximately 31.5% of diagnostic services revenue for the nine months ended September 30, 2022, was generated from the HRSA program for uninsured individuals, down from 64.7% in 2021 [256]. Cost and Expenses - Cost of revenues for the nine months ended September 30, 2022, was $41.5 million, compared to $16.5 million for the same period in 2021, with diagnostic services accounting for $33.6 million of the total [236]. - General and administration expenses for Q3 2022 were $7.5 million, an increase from $5.9 million in Q3 2021, primarily due to higher personnel expenses and professional fees [230]. - General and administration expenses rose to $21.6 million in 2022 from $14.7 million in 2021, primarily due to higher personnel expenses and professional fees [239]. - Research and development costs decreased to $110,000 in Q3 2022 from $208,000 in Q3 2021, reflecting reduced personnel expenses [231]. - Research and development costs decreased to $0.2 million in 2022 from $0.4 million in 2021, mainly due to reduced personnel expenses [240]. - Interest expense decreased to $0.6 million in 2022 from $0.9 million in 2021, attributed to the repayment of convertible notes [242]. Profitability and Margins - Gross profit for the three months ended September 30, 2022, was $12.0 million, compared to $4.0 million in Q3 2021, resulting in a gross margin of 49.5% versus 42.0% in the prior year [228]. - Gross profit for the nine months ended September 30, 2022, was $59.4 million, up from $17.4 million in the same period of 2021, reflecting a gross margin increase from 51.2% to 58.9% [237]. - Diagnostic services gross margin improved to 63.4% in 2022 from 56.8% in 2021, driven by increased efficiencies and reduced costs [237]. Cash and Liquidity - Cash, cash equivalents, and restricted cash increased to $22.8 million as of September 30, 2022, from $8.7 million at December 31, 2021, with working capital rising to $53.6 million [251]. - The company estimates sufficient cash and liquidity to finance operations for at least 12 months, despite uncertainties in the diagnostic testing business beyond COVID-19 [252]. Accounting and Risk Management - The company evaluates accounts receivable and establishes an allowance for doubtful accounts based on past write-offs and current credit conditions [267]. - Goodwill and long-lived assets are reviewed annually for impairment, with fair value determined by market prices or projected future cash flows [269]. - The Tax Cuts and Jobs Act reduced the federal tax rate from 35% to 21%, effective January 1, 2018, impacting deferred tax assets and liabilities [270]. - Inventory is valued at the lower of cost or net realizable value, with provisions for excess and obsolete inventory based on customer demand [272]. - The adoption of ASU 2020-06 did not have a material impact on the company's financial statements or disclosures [273]. - The company is assessing the impact of ASU 2016-13, which introduces a current expected credit loss model effective for fiscal years beginning after December 15, 2022 [275]. - Current economic conditions may lead to a decline in business and consumer spending, adversely affecting accounts receivables and asset recoverability [279]. - There have been no material changes to market risk exposures since December 31, 2021, except for the effects of COVID-19 on the global economy [280]. Strategic Initiatives - The company continues to pursue acquisition opportunities for technologies and products within and outside the consumer products industry [223].

NOVEMBER 2022 A ProPhase | --- | --- | --- | --- | |-------|-------|-------|-------------------------| | | | | ProPhaseLabs.com | | | | | CORPORATE PRESENTATION | | | | | NASDAQ: PRPH | FORWARD LOOKING STATEMENTS This presentation contains forward‐looking statements relating to our strategy and business objectives. All statements other than statements of historical facts included in this presentation may be deemed to be forward‐looking statements including statements regarding our strategy, plans, objective ...

SEPTEMBER 2022 ▲ ProPhase | --- | --- | --- | --- | |-------|-------|-------|------------------------------------------| | | | | | | | | | ProPhaseLabs.com CORPORATE PRESENTATION | | | | | | | | | | NASDAQ: PRPH | FORWARD LOOKING STATEMENTS This presentation contains forward‐looking statements relating to our strategy and business objectives. All statements other than statements of historical facts included in this presentation may be deemed to be forward‐looking statements including statements regarding ou ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____to _____ Commission file number 000-21617 ProPhase Labs, Inc. (Exact name of registrant as specified in its charter) Delaware 23-2577138 (State or other jurisdiction ...