ProPhase Labs(PRPH) - 2024 Q4 - Annual Results

Financial Performance - For the year ended December 31, 2024, net revenue decreased by $28.2 million, or 80.6%, to $6.8 million compared to $35.0 million for the year ended December 31, 2023, primarily due to a $24.8 million decrease in diagnostic services[16] - The company reported a gross loss of $0.2 million for the year ended December 31, 2024, compared to a gross profit of $15.6 million for the year ended December 31, 2023, resulting in an overall gross margin of (2.2)%[18] - The company reported a net loss of $53,364 million for 2024, compared to a net loss of $16,782 million in 2023, indicating a significant increase in losses[34] - Adjusted EBITDA from continuing operations was $(17,897) million in 2024, worsening from $(11,416) million in 2023[40] - The company reported a significant credit loss expense of $11,018 million in 2024, compared to only $91 million in 2023[34] Cash and Assets - The company’s cash and cash equivalents as of December 31, 2024, were $0.7 million, down from $1.6 million at December 31, 2023, with working capital decreasing to $(1.5) million[23] - Cash and cash equivalents decreased from $1,609 million at the end of 2023 to $678 million at the end of 2024, a drop of approximately 58%[34] - Total assets decreased from $91,927 million in 2023 to $63,200 million in 2024, a decline of approximately 31%[29] - Current assets fell from $47,585 million in 2023 to $30,637 million in 2024, representing a decrease of about 36%[29] - Accounts receivable decreased from $35,814 million in 2023 to $20,058 million in 2024, a decline of approximately 44%[29] - Inventory decreased from $2,291 million in 2023 to $1,143 million in 2024, a reduction of about 50%[29] Expenses - General and administration expenses increased by $4.4 million to $37.9 million for the year ended December 31, 2024, compared to $33.4 million for the year ended December 31, 2023[20] - Research and development costs decreased to $0.6 million for the year ended December 31, 2024, down from $1.4 million in 2023[21] Strategic Initiatives - ProPhase sold its manufacturing division for approximately $23 million in January 2025, enhancing financial flexibility and significantly reducing debt[5] - The company is exploring a potential sale of its subsidiary Nebula Genomics while evaluating strategic options[12] - ProPhase has entered into a new revenue initiative with Crown Medical Collections, estimating the recovery of approximately $50 million in insurance payments[14] - The company aims to launch an integrated telehealth initiative to leverage partnerships across its health and genomic services[15] Market Potential - The BE-Smart diagnostic platform is expected to target a market of approximately 7 million endoscopies annually in the U.S., equating to a potential annual market size of $7 - $14 billion[10] Liabilities - Total liabilities increased from $42,544 million in 2023 to $55,847 million in 2024, an increase of about 31%[31]