Wellgistics Health Inc(US:WGRX)2025-11-19 22:23Revenue Generation and Market Overview - Wellgistics Health expects to generate revenues primarily through Wellgistics Pharmacy and Wellgistics LLC after acquiring Wood Sage, LLC in June 2024 and Wellgistics, LLC in August 2024[182]. - The National Health Expenditure Data for 2022 reached $4.5 trillion, accounting for 17.3% of GDP, with an expected increase to 19.7% by 2032[184]. - Total retail prescription drug spending increased by 8.4% from 2021 to 2022, reaching $405.9 billion[184]. - The U.S. market for medicines reached $435 billion in 2023, with the specialty drug market accounting for over 50% of prescription drug spending despite being less than 10% of total drugs[184]. - Wellgistics, LLC serves over 5,000 registered pharmacies nationwide, focusing on competitive pricing and unique products[172]. - Wellgistics Pharmacy is licensed in 32 states and the District of Columbia, expanding its operations to include mail order pharmacy services[178]. - The pharmacy network includes over 19,000 independent pharmacies across the U.S., capable of delivering prescriptions in hours, servicing approximately 1.3 billion prescriptions annually[185]. - Wellgistics Health aims to enhance patient outcomes by improving medication adherence and providing access to clinical resources[185]. - The company plans to expand its wholesale operations and establish new manufacturer relationships to maximize revenues[185]. Financial Performance - Net revenues for the three months ended September 30, 2025, were $3,012,904, a decrease of approximately 47% compared to $5,673,868 for the same period in 2024[198]. - Gross profit for the three months ended September 30, 2025, was $231,012, representing a decline of approximately 56% from $521,244 in 2024[200]. - General and administrative expenses for the three months ended September 30, 2025, increased to $30,172,800 from $1,798,641 in 2024, primarily due to the acquisition of Wellgistics LLC[202]. - Sales and marketing expenses for the three months ended September 30, 2025, were $803,747, compared to $0 for the same period in 2024, reflecting expanded promotional activities[203]. - Net revenues for the nine months ended September 30, 2025, were $21,667,212, compared to $5,718,408 for the same period in 2024, driven by acquisitions[209]. - Gross profit for the nine months ended September 30, 2025, was $1,429,405, an increase of approximately 176% from $518,636 in 2024[211]. - General and administrative expenses for the nine months ended September 30, 2025, were $66,205,669, up from $2,448,813 in 2024, largely due to acquisitions[214]. - Interest expense for the nine months ended September 30, 2025, was $3,703,837, compared to $142,281 in 2024, reflecting increased financing activities[218]. - The significant increase in other expenses for the nine months ended September 30, 2025, totaled $5,024,498, compared to $126,874 in 2024, primarily due to interest expenses and losses related to acquisitions[217]. - The Company recognized a loss of $1,353,663 for the nine months ended September 30, 2025, due to the amendment of the Membership Interest Purchase Agreement, increasing the promissory note from $15 million to $17.5 million[219]. Debt and Financing Activities - As of September 30, 2025, total debt amounted to $24,809,234, an increase from $23,382,901 as of December 31, 2024[225]. - The Company expects to generate positive cash flow from operations in 2025, driven by annual revenue from Wood Sage and Wellgistics LLC[220]. - The Company issued a total of 3,426,254 shares of common stock, resulting in net proceeds of $2,838,787 as of September 30, 2025[223]. - A public offering of 7,142,862 shares of common stock was filed on September 29, 2025, generating net proceeds of approximately $4.53 million[224]. - The Company entered into a secured term loan of $1,300,000 on August 26, 2025, with a total repayment obligation of $1,872,000[231]. - The Company recorded interest expenses of $668,148 for the nine months ended September 30, 2025, related to various debt instruments[230]. - The Company plans to use proceeds from offerings to strengthen working capital, support operations, and pursue strategic acquisitions[224]. - The Company has ongoing initiatives for facility expansion, employee recruitment, and technology upgrades to meet operational needs[221]. - The Company is focusing on strategic acquisitions to enhance its health ecosystem, including investments in artificial intelligence and data warehousing capabilities[222]. - Wellgistics, LLC entered into a new credit agreement for a line of credit of $10,000,000 with an annual interest rate of 16.84%[241]. - As of September 30, 2025, the outstanding balance on the line of credit was $2,973,751, down from $5,531,260 as of December 31, 2024[241]. Cash Flow and Investment Activities - Net cash used in operating activities for the nine months ended September 30, 2025 was $4,561,776, primarily due to a net loss of $72,981,336[247]. - Net cash provided by financing activities for the nine months ended September 30, 2025 was $8,388,250, driven by gross proceeds of $4,000,000 from the IPO and $20,070,000 from the revolving line of credit[250]. - The company fully repaid the $1.2 million promissory note as of September 30, 2025, compared to an outstanding balance of $137,141 as of December 31, 2024[243]. - The company plans to retain future earnings for operations, expansion, and debt repayment, with no current plans to pay cash dividends[245]. - Net cash used in investing activities for the nine months ended September 30, 2025 was $626,144, primarily for capitalized software expenditures[249]. Accounting and Revenue Recognition - The company recognized revenue at the point of sale, with the majority of orders placed via its website[256]. - The company accounts for acquisitions as business combinations, allocating the purchase price to the fair values of acquired assets and liabilities[262]. - As of September 30, 2025, the company had total outstanding debt principal payments of $24,809,234 scheduled through 2028[244].