Contact: Donna Vigilante (631) 273-0900 dvigilante@u-g.com NOTE: This press release contains both historical and "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements about the company's expectations or beliefs concerning future events, such as financial performance, business prospects, and similar matters, are being made in reliance upon the "safe harbor" provisions of that Act. Such statements are subject to a variety of factors that coul ...

Core Insights - United-Guardian, Inc. reported a decline in both net sales and net income for the first quarter of 2025, with net sales at $2.48 million, down 24% from $3.25 million year-over-year, and net income falling 39% to $560,895 or 12 cents per share from $925,442 or 20 cents per share [2][6] Business Segment Performance - The cosmetic ingredients segment experienced a significant decline, with sales dropping 63% year-over-year to $698,998 from $1.88 million, primarily due to a 74% reduction in orders from its largest distributor, Ashland Specialty Ingredients [3] - Pharmaceutical sales rebounded, with net sales increasing 23% to $1.17 million from $950,323 in the previous year, driven by the normalization of Renacidin supply, which saw gross sales rise 38% year-over-year to $1.23 million [4] - Medical lubricant sales grew 43% year-over-year to $613,671, benefiting from increased demand in India and China, making it the strongest performing segment [5] Management Commentary - The company's president acknowledged the challenging start to the year, attributing revenue shortfalls to the cosmetic ingredient business but highlighted the strength in medical lubricants and pharmaceuticals as positive signs [6] - Concerns were raised regarding evolving trade policies and tariffs by the U.S. government, which could introduce uncertainty for product lines tied to China markets, although the company is monitoring these risks [7] Financial Metrics - Cost of sales decreased to $1.12 million from $1.56 million year-over-year, improving as a percentage of revenues to 45% from 48% [8] - Operating expenses rose 11% to $632,735 due to higher payroll and marketing costs, while research and development expenses also increased by 11% to $114,394 [8] - Investment income and gains on marketable securities fell to $97,037 from $139,569 a year earlier, attributed to lower interest income and reduced unrealized gains [9] Future Outlook - The company expressed confidence in its long-term strategy, particularly in product development and market expansion, with plans to begin manufacturing and sales of the Natrajel product in 2025 [10] - In February 2025, United-Guardian expanded its partnership with Azelis Group NV to include South Korea and broadened coverage in the U.K. and Ireland [11]

Financial Performance - Net sales for Q1 2025 were $2,481,127, a decrease of 23.7% compared to $3,254,944 in Q1 2024[11] - Net income for Q1 2025 was $560,895, down 39.4% from $925,442 in Q1 2024[11] - Earnings per share (basic and diluted) decreased to $0.12 in Q1 2025 from $0.20 in Q1 2024[11] - Total net sales for the three months ended March 31, 2025, were $2,481,127, down from $3,254,944 in the same period of 2024, representing a decline of approximately 23.7%[52] - Revenue from pharmaceutical sales increased to $1,168,458 in Q1 2025, compared to $950,323 in Q1 2024, reflecting a growth of approximately 23%[52] - Net sales for Q1 2025 decreased by $773,817 (approximately 24%) compared to Q1 2024, primarily due to a 63% decrease in sales of cosmetic ingredients[93] Assets and Liabilities - Total current assets decreased to $11,691,416 in Q1 2025 from $12,665,551 in Q4 2024, a decline of 7.7%[14] - Total liabilities remained stable at $1,927,638 in Q1 2025, compared to $1,914,469 in Q4 2024[17] - Cash and cash equivalents at the end of Q1 2025 were $1,269,212, down 32.3% from $1,875,655 at the end of Q4 2024[14] - Cash held in excess of FDIC limits was approximately $962,000 as of March 31, 2025, compared to $234,000 at December 31, 2024[38] - Working capital decreased by $987,304 to $9,763,778 at March 31, 2025, down from $10,751,082 at December 31, 2024[104] Expenses - Research and development expenses increased to $114,394 in Q1 2025 from $102,982 in Q1 2024, reflecting a growth of 11.5%[11] - Operating expenses increased by $63,870 (approximately 11%) in Q1 2025 compared to Q1 2024, mainly due to higher sales and marketing expenses[98] - R&D expenses rose by $11,412 (approximately 11%) in Q1 2025 compared to Q1 2024, driven by increased payroll-related expenses[99] - The provision for income taxes for Q1 2025 was $147,064, a decrease from $240,734 in Q1 2024, with federal income taxes current provision at $107,860 compared to $169,940 in the prior year[67] Dividends - Dividends declared and paid in Q1 2025 were $1,607,893, compared to $1,148,468 in Q1 2024, an increase of 40%[24] - The company declared a cash dividend of $0.35 per share in January 2025, totaling $1,608,012, compared to a dividend of $0.25 per share totaling $1,148,580 in January 2024[82][83] Market and Distribution - The company entered a distribution agreement with Brenntag Specialties for its new Natrajel® line, expecting to begin sales in 2025[27] - The company expanded its presence in the sexual wellness market by partnering with Brenntag Specialties to distribute the new Natrajel line across North and South America, with manufacturing and revenue expected to begin in 2025[86] - A new territory, South Korea, was added for personal care distribution in February 2025, expanding the relationship with Azelis Group NV, which also includes the medical market in the UK and Ireland[87] - Approximately 29% of total sales in Q1 2025 were to customers outside the United States, up from 13% in Q1 2024[52] - Three pharmaceutical distributors and one cosmetic ingredient distributor accounted for 67% of gross sales in Q1 2025, down from 83% in Q1 2024[76] Cash Flow - The company generated cash from operations of $322,080 in Q1 2025, down from $644,120 in Q1 2024, primarily due to a decrease in net income[107] - Net cash used in financing activities increased to $1,607,893 in Q1 2025 from $1,148,468 in Q1 2024, due to higher dividend payments[109] Other Financial Metrics - The allowance for credit losses related to accounts receivable increased to $18,114 as of March 31, 2025, compared to $14,342 on December 31, 2024[41] - The company recognized net gains of $12,350 on marketable securities for the three months ended March 31, 2025, compared to $41,496 in the same period of 2024[60] - As of March 31, 2025, total marketable securities amounted to $6,851,997, with an unrealized gain of $42,834 compared to a total of $7,522,625 and an unrealized gain of $28,977 as of December 31, 2024[62][63] - The company reported proceeds from the redemption of marketable securities of $6,148,493 in Q1 2025, including realized losses of $1,507, compared to $150,000 with no realized gains or losses in Q1 2024[64] - Cost of sales as a percentage of net sales decreased to 45% in Q1 2025 from 48% in Q1 2024, attributed to lower per-unit overhead rates[97] - The effective income tax rate was approximately 21% for both Q1 2025 and Q1 2024, expected to remain stable for the current fiscal year[103] Supply Chain and Risks - The company is monitoring the impact of global supply chain instability and tariffs, particularly concerning imports from China[33] - The company has a significant concentration of receivables, with potential risks associated with the financial position of a small number of customers[55]

[United-Guardian Q1 2025 Earnings Release](index=1&type=section&id=United-Guardian%20Q1%202025%20Earnings%20Release) [Financial Highlights](index=1&type=section&id=Financial%20Highlights) United-Guardian reported significant Q1 2025 declines in net sales (23.8% to $2.48 million) and net income (39.4% to $0.56 million), with EPS falling from $0.20 to $0.12 Q1 2025 vs Q1 2024 Key Financial Results | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $2,481,127 | $3,254,944 | -23.8% | | Net Income | $560,895 | $925,442 | -39.4% | | EPS (basic and diluted) | $0.12 | $0.20 | -40.0% | [Business Segment Performance and Outlook](index=1&type=section&id=Business%20Segment%20Performance%20and%20Outlook) Strong growth in medical lubricant and pharmaceutical segments was offset by a 63% decline in cosmetic ingredients due to reduced ASI orders and excess inventory in China, with tariff concerns noted - The overall decrease in sales and earnings was primarily driven by a significant downturn in the cosmetic ingredient business, despite positive performance in other segments[3](index=3&type=chunk) Q1 2025 Year-over-Year Sales Growth by Segment | Business Segment | Sales Change vs Q1 2024 | | :--- | :--- | | Medical Lubricant | +43% | | Pharmaceutical | +23% | | Cosmetic Ingredients | -63% | - The reduction in cosmetic ingredient orders from partner ASI is attributed to excess inventory in China and the timing of orders. ASI has confirmed no significant loss of customers[3](index=3&type=chunk) - Potential tariffs announced by the U.S. government on imports remain a concern, with the financial impact currently difficult to determine[3](index=3&type=chunk) [Consolidated Statements of Income](index=1&type=section&id=Consolidated%20Statements%20of%20Income) Unaudited Q1 2025 statements show decreased net sales and income from operations, falling from $1.03 million in Q1 2024 to $0.61 million, despite reduced total costs and expenses Statements of Income (Unaudited) - For the Three Months Ended March 31, | Line Item | 2025 | 2024 | | :--- | :--- | :--- | | **Net sales** | **$2,481,127** | **$3,254,944** | | Cost of sales | 1,123,076 | 1,556,490 | | Operating expenses | 632,735 | 568,865 | | Research and development | 114,394 | 102,982 | | *Total costs and expenses* | *1,870,205* | *2,228,337* | | **Income from operations** | **610,922** | **1,026,607** | | Investment income | 84,687 | 98,073 | | Net gain on marketable securities | 12,350 | 41,496 | | *Total other income* | *97,037* | *139,569* | | **Income before provision for income taxes** | **707,959** | **1,166,176** | | Provision for income taxes | 147,064 | 240,734 | | **Net income** | **$560,895** | **$925,442** | | **Earnings per common share** | **$0.12** | **$0.20** | | Weighted average shares | 4,594,319 | 4,594,319 |

Financial Performance - United-Guardian, Inc. reported a decrease in first quarter sales from $3,254,944 in 2024 to $2,481,127 in 2025, representing a decline of approximately 23.7% [1][4] - Net income also decreased from $925,442 ($0.20 per share) in 2024 to $560,895 ($0.12 per share) in 2025, reflecting a decline of about 39.3% [1][5] Business Segment Performance - The medical lubricant and pharmaceutical segments showed positive performance, with sales increasing by 43% and 23% respectively in the first quarter of 2025 compared to the same period in 2024 [2] - Conversely, sales in the cosmetic ingredient segment decreased significantly by 63% in the first quarter of 2025, primarily due to reduced orders from Ashland Specialty Ingredients (ASI) [2] Operational Insights - The decrease in orders from ASI was attributed to excess inventory in China that needed to be worked off and the timing of product orders, although ASI confirmed no significant loss of business or customers [2] - The company expressed concerns regarding potential impacts from tariff announcements by the U.S. federal government on imports, indicating uncertainty in future operations and financial conditions [2]

Core Viewpoint - United-Guardian, Inc. reported improved financial results for 2024, driven by strong sales in cosmetic ingredients and medical lubricants, despite challenges in the pharmaceutical segment due to supply disruptions [14]. Revenue & Earnings Growth From Prior Year - The company achieved a 12% year-over-year increase in net sales, rising from $10.89 million in 2023 to $12.18 million in 2024 [2]. - Net income increased by 26% to $3.25 million, or $0.71 per share, compared to $2.58 million, or $0.56 per share, in the previous year [2]. Segment Performance & Business Drivers - Sales of cosmetic ingredients surged by 32% year over year, attributed to increased purchase orders from the largest distributor and improved demand in China [4]. - Medical lubricant sales rose by 16%, driven by demand from a major contract manufacturer in China [4]. - Pharmaceutical sales declined by 5% due to a supply disruption of Renacidin, which affected sales in the first quarter of 2024 [5]. Management Commentary - The president of United-Guardian highlighted the strong performance in the cosmetics and medical lubricant segments as key contributors to revenue and profit growth [6]. - Management expressed optimism regarding the recovery of Renacidin sales in 2025 following the supply issues [7]. Financial Position & Key Metrics - Total assets increased to $13.80 million from $12.92 million, while current assets rose to $12.67 million from $12.25 million [8]. - Total liabilities increased to $1.91 million from $1.53 million, and stockholders' equity grew to $11.88 million from $11.39 million [8]. Factors Influencing Financial Results - Improved financial performance was driven by increased sales volumes in higher-margin product categories and controlled operating expenses [10]. - Investment income contributed positively to net income, reflecting a favorable interest rate environment [11]. - The decline in pharmaceutical sales highlighted the company's exposure to supply-chain volatility, but management indicated that these issues are now resolved [12]. Other Developments - The company maintained its focus on organic growth across its core business lines without changes in strategic direction or corporate structure [13].

Sales Performance - Sales increased by approximately 12%, from $10,885,154 in 2023 to $12,181,971 in 2024, driven by a 51% increase in sales to the largest distributor, ASI[146]. - Sales of cosmetic ingredients rose by approximately 32%, from $4,132,334 in 2023 to $5,438,262 in 2024, primarily due to increased demand in China[147]. - Gross sales of pharmaceutical products, Renacidin and Clorpactin, decreased by approximately 5%, from $5,894,220 in 2023 to $5,602,259 in 2024[149]. - Net sales of pharmaceutical products decreased by approximately 5% in 2024 compared to 2023, attributed to a decrease in gross sales and pharmaceutical-related rebates[151]. - Sales of medical lubricants increased by approximately 16% in 2024, rising from $1,750,632 in 2023 to $2,028,564 in 2024, driven by demand from a major customer in China[153]. Financial Outlook - The company anticipates beginning manufacturing and revenue generation for the new Natrajel line of sexual wellness ingredients in 2025[121]. - The company discontinued its specialty industrial products line in mid-2023 to focus on higher-value product categories[120]. - The company is facing global supply chain instability, which may impact future gross margins due to potential increases in shipping costs[124]. - The company has a "specified small manufacturer" designation, which is expected to reduce rebate liabilities in 2025 and 2026[135]. - The company plans to enhance its competitive position by investing in new products, particularly in naturally derived products[148]. - The company continues to monitor the impact of tariffs on its operations, particularly those affecting imports from China, Canada, and Mexico[125]. Expenses and Profitability - Gross profit on sales increased to 53% in 2024 from 50% in 2023, primarily due to a 32% increase in cosmetic ingredient sales and a higher percentage of cosmetic product sales[156]. - Operating expenses rose by approximately 13% from $2,078,564 in 2023 to $2,356,819 in 2024, mainly due to increased sales and marketing expenses and payroll costs[157]. - Research and development expenses decreased by approximately 2% from $463,992 in 2023 to $456,779 in 2024, with expectations for a modest increase in 2025[158]. Investment and Cash Flow - Investment income increased by approximately 42% from $306,651 in 2023 to $434,679 in 2024, driven by higher interest income from longer-term investments[159]. - Net cash used in investing activities was $7,077,395 in 2024, compared to net cash provided of $4,277,577 in 2023, primarily due to increased purchases of longer-term investments[166]. - Dividends paid increased to $0.60 per share in 2024 from $0.10 per share in 2023, resulting in net cash used in financing activities of $2,756,323[167]. Working Capital and Receivables - Working capital increased from $10,718,457 at December 31, 2023, to $10,751,082 at December 31, 2024, despite a decrease in the current ratio from 8.0 to 1 to 6.6 to 1[163]. - Accounts receivable decreased from $1,566,839 in 2023 to $1,428,455 in 2024, with a receivables turnover of 45 days compared to 50 days in 2023[164].

Financial Performance - Net sales for FY 2024 increased by 12% to $12,181,971 from $10,885,154 in FY 2023[2] - Net income rose to $3,250,875 ($0.71 per share) in 2024, compared to $2,581,370 ($0.56 per share) in 2023[2] - Income from operations increased to $3,646,789 in 2024, compared to $2,863,032 in 2023[5] - Investment income rose to $434,679 in 2024 from $306,651 in 2023[6] Sales Performance - Sales of cosmetic ingredients increased by 32%, while medical lubricants saw a 16% rise, driven by higher demand in China[3] - Pharmaceutical sales decreased by 5% in 2024 due to a supply disruption of Renacidin, impacting sales until supply levels resumed[3] Costs and Expenses - Total costs and expenses for FY 2024 were $8,535,182, up from $8,022,122 in FY 2023[5] Assets and Equity - Total assets increased to $13,797,335 in 2024, up from $12,922,838 in 2023[8] - Stockholders' equity grew to $11,882,866 in 2024, compared to $11,388,582 in 2023[8] - Current liabilities increased to $1,914,469 in 2024 from $1,534,256 in 2023[8]

Core Viewpoint - United-Guardian, Inc. reported a significant increase in net sales and net income for FY 2024 compared to FY 2023, indicating strong performance in its key product segments [1][2]. Financial Performance - Net sales increased by 12% from $10,885,154 in 2023 to $12,181,971 in 2024 [1][4]. - Net income rose to $3,250,875 ($0.71 per share) in 2024, up from $2,581,370 ($0.56 per share) in 2023 [1][5]. - Income from operations improved to $3,646,789 in 2024 from $2,863,032 in 2023 [4]. - Total costs and expenses increased from $8,022,122 in 2023 to $8,535,182 in 2024 [4]. Segment Performance - Sales of cosmetics ingredients surged by 32%, attributed to increased orders from the largest distributor and higher demand in China [2]. - Medical lubricants sales grew by 16%, driven by demand from a major contract manufacturer in China [2]. - Pharmaceutical sales experienced a decline of 5% due to a supply disruption of Renacidin, which affected sales in early 2024 [2]. Balance Sheet Highlights - Total assets increased to $13,797,335 in 2024 from $12,922,838 in 2023 [7]. - Stockholders' equity rose to $11,882,866 in 2024, compared to $11,388,582 in 2023 [7]. - Current assets also saw an increase, reaching $12,665,551 in 2024 from $12,252,713 in 2023 [7].

Core Points - United-Guardian, Inc. declared a cash dividend of $0.35 per share, to be paid on February 18, 2025, to stockholders of record as of February 10, 2025, marking the 30th consecutive year of dividend payments [1][2] - The dividend amount is consistent with the previous distribution made in July 2024, indicating a stable dividend policy [2] Company Overview - United-Guardian is engaged in the manufacturing of cosmetic ingredients, medical lubricants, sexual wellness ingredients, and pharmaceuticals [2]