Know Labs(KNW)2024-02-14 23:36Financial Data and Key Metrics Changes - For Q1 fiscal '24, the company reported a net loss of $3.45 million, an improvement of 9.8% compared to a net loss of $3.82 million in Q1 fiscal '23, translating to an earnings per share loss of $0.04, better than the prior year EPS of $0.08, reflecting a 50% improvement before preferred stock dividends [45][46] - Selling, general and administrative expenses for Q1 '24 were $2.01 million, an increase of 5.6% from $1.91 million in the same period last year, primarily due to increased salaries from key new hires [13] - Research and development expenses for Q1 fiscal '24 were $1.48 million, a decrease of 14.7% year-over-year from $1.74 million in Q1 fiscal '23, attributed to reduced personnel and external consultant costs [30] Business Line Data and Key Metrics Changes - The company is focused on four core work streams: hardware development, clinical trials and data collection, algorithm development, and intellectual property [6][7][9] - The hardware work stream has seen significant progress with the completion of the portable Gen 1 prototype for non-invasive glucose monitoring [6] - Clinical trials are ongoing with up to 100 participants, focusing on diabetes and pre-diabetes populations to collect critical data [7] Market Data and Key Metrics Changes - The company is preparing to present at the International Conference on Advanced Technologies and Treatments for Diabetes (ATTD) in Florence, Italy, which is expected to enhance awareness and networking opportunities within the medical community [10][11] Company Strategy and Development Direction - The company aims to refine its algorithm to achieve a mean absolute relative difference (MARD) of 10% or less, focusing on accuracy across varying glycemic ranges [27] - Intellectual property remains a core focus, with 264 patents issued, pending, and in process, reinforcing the company's innovation strategy [9] - The company is exploring revenue opportunities outside the FDA pathway, particularly in international markets and potential licensing of its platform technology [53][55] Management's Comments on Operating Environment and Future Outlook - Management acknowledges a competitive landscape with established players like Dexcom and Abbott Labs, emphasizing the need for vigilance and innovation [36] - The company has made adjustments to fixed expenses, significantly reducing its core monthly burn rate, and believes it has sufficient cash to operate until at least June 30, 2024 [31] - Management is optimistic about upcoming developments and expects to share updates on the non-invasive glucose monitor soon [39] Other Important Information - The company has added new members to its Board of Directors and medical advisory board to enhance its expertise in core work streams [28] - A non-cash charge of $792,000 was recorded in Q1 fiscal '24, primarily related to stock-based compensation [30] Q&A Session Summary Question: Can you address the burn rate and any unusual expenditures? - The incremental spend has been about $200,000 to $300,000 a month, with a one-time expense of close to $1 million for auditors and counsel related to financing [16] Question: What is the status of joint development agreements? - The company is moving forward with several joint development agreements, which are critical for future success, but details are constrained by non-disclosure agreements [50] Question: How does the company view the competitive landscape? - The company sees a competitive marketplace with established players and new entrants, but believes it has a competitive edge due to its intellectual property [36][51] Question: Will the second-generation device be shown in Italy? - The company is actively exploring revenue opportunities without FDA clearance and is considering the potential for its technology in less developed markets [53][54]