ChromaDex(US:CDXC)2021-08-02 16:00Financial Performance - Total net sales increased by approximately 16% for the three months ended June 30, 2021, and 9% for the six months ended June 30, 2021, compared to the same periods in 2020[142] - E-commerce sales for TRU NIAGEN® increased approximately $2.5 million, or 31%, for the three months ended June 30, 2021, and $3.9 million, or 24%, for the six months ended June 30, 2021, compared to the same periods in 2020[145] - The analytical reference standards and services segment saw a 20% increase in sales for the six months ended June 30, 2021, compared to the same period in 2020[143] - Consumer products segment gross profit increased by 33% to $9.8 million for the three months ended June 30, 2021, and by 27% to $18.1 million for the six months ended June 30, 2021 compared to the same periods in 2020[149] - Total gross profit for the company increased by 19% to $10.8 million for the three months ended June 30, 2021, and by 15% to $20.0 million for the six months ended June 30, 2021 compared to the same periods in 2020[149] Losses and Expenses - The net loss for the three months ended June 30, 2021, was $5.6 million, compared to a net loss of $3.7 million for the same period in 2020[142] - Basic and diluted loss per common share for the three months ended June 30, 2021, was $(0.08), compared to $(0.06) for the same period in 2020[142] - General and administrative expenses increased by 32% to $9.1 million for the three months ended June 30, 2021, and by 18% to $18.7 million for the six months ended June 30, 2021 compared to the same periods in 2020, primarily due to increased legal expenses[153] - Total sales and marketing expenses increased by 26% to $6.2 million for the three months ended June 30, 2021, and by 33% to $12.5 million for the six months ended June 30, 2021 compared to the same periods in 2020[150] - Research and development expenses increased by 12% to $1.0 million for the three months ended June 30, 2021, and by 5% to $1.8 million for the six months ended June 30, 2021 compared to the same periods in 2020[152] - The ingredients segment gross profit decreased by 52% to $0.8 million for the three months ended June 30, 2021, and by 50% to $1.6 million for the six months ended June 30, 2021 compared to the same periods in 2020[149] - The company incurred aggregate losses of approximately $154.8 million from inception through June 30, 2021, primarily due to operational development and litigation-related expenses[159] Cash and Financing - As of June 30, 2021, the company had approximately $38.8 million of cash and cash equivalents on hand, with an additional line of credit of up to $7.0 million available[140] - The company received proceeds of $24.9 million from financing on February 23, 2021, and $1.9 million in June 2021 under the ATM facility[161] - Net cash used in operating activities for the six months ended June 30, 2021 was approximately $13.3 million, an increase from approximately $6.8 million for the same period in 2020[165] - Net cash provided by financing activities was approximately $35.7 million for the six months ended June 30, 2021, significantly up from approximately $7.0 million for the same period in 2020[168] - The company expects operating cash flows to fluctuate significantly in future periods due to various factors including operating results and inventory management[166] Operational Challenges - The company has experienced delays in the supply chain due to global packaging shortages but has addressed these issues in the second quarter of 2021[134] - A material weakness in internal control over financial reporting was identified, affecting the disclosure of a potential loss of approximately $1.6 million[174] - The company is in the process of addressing the identified material weakness and expects remediation to be completed by the end of 2021[175] - As of June 30, 2021, the company's disclosure controls and procedures were deemed not effective due to the material weakness[175] - No changes in internal control over financial reporting occurred that materially affected the company's internal control during the second fiscal quarter[177] Other Financial Information - Cost of sales as a percentage of net sales decreased by 2% and 3% for the three and six months ended June 30, 2021, respectively, compared to the same periods in 2020[147] - There were no material changes in contractual obligations during the six months ended June 30, 2021[169] - The company had no material off-balance sheet arrangements during the six months ended June 30, 2021[170] - The company maintains a full valuation allowance against deferred tax assets, resulting in an effective tax rate of approximately 0% for the three and six months ended June 30, 2021[155]