ImmuCell(ICCC) - 2024 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Sales growth of 52% during both Q4 2024 and the full year of 2024 compared to the same periods in the prior year [8] - Gross margin increased by 125% or $1.6 million to$ 2.8 million in Q4 2024 compared to Q4 2023, and increased by 105% or $4.1 million to$ 7.9 million for the year ended December 31, 2024 compared to 2023 [14] - EBITDA of $1.3 million in Q4 2024, contrasting with negative EBITDA of$ 311,000 in Q4 2023, and $1.1 million for the year ended December 31, 2024 compared to negative EBITDA of$ 2.6 million in 2023, marking a swing of approximately $3.7 million [16] Business Line Data and Key Metrics Changes - The company achieved$ 7.8 million in sales during Q4 2024, indicating successful capacity increase to $30 million or more per year [10] - The gross margin percentage recorded in Q4 2024 was 36.5%, with a target to exceed 40% in the future [15] Market Data and Key Metrics Changes - The company is focused on the dairy market, particularly with the upcoming product Re-Tain, which aims to revolutionize treatment for subclinical mastitis [18] - The initiation of the control launch for Re-Tain is pending FDA clearance, with discussions ongoing for expedited review [19] Company Strategy and Development Direction - The company is committed to seeing Re-Tain through regulatory approval and is exploring strategic options to offset product development expenses [20] - Focus remains on improving operational efficiency and production yields to enhance cash flow and profitability [13] Management's Comments on Operating Environment and Future Outlook - Management noted that production contamination events previously limited growth, but improvements have been made to control quality and increase production capacity [8][10] - The company is optimistic about achieving FDA approval for Re-Tain and is preparing for a market launch in 2025 [19][20] Other Important Information - The company raised net proceeds of almost$ 4.4 million during 2024 to improve cash position, increasing cash to approximately $3.8 million as of December 31, 2024 [17] - A Form 10-K is planned to be filed around the end of March with audited financial details [22] Q&A Session Summary Question: Inquiry on gross margin and its changes - Management acknowledged that product mix, pricing, and throughput are key factors affecting gross margin, with a goal to return to over 40% [28][31] Question: Clarification on inventory levels and WIP - Management confirmed that increased inventory is primarily due to contracted milk deliveries that could not be utilized due to unforeseen events, but they are exploring new product formats to leverage this inventory [40][42][44] Question: Timeline for new product format - Management indicated that the new product format is expected to be ready for beta testing with customers in 2025, allowing for faster market entry without regulatory hurdles [46][47]