NovaBay(US:NBY)2024-03-26 22:43Financial Data and Key Metrics Changes - Total sales for Q4 2023 increased by 2% to $3.7 million compared to the prior year, driven by higher sales in eye care and wound care products [7][21] - Gross margin on net product revenue was 49% for Q4 2023, slightly up from 48% in Q4 2022 [7] - For the full year 2023, total sales net were $14.7 million, an increase of 2% versus 2022, with eye care and wound care segment sales growing by 9% [23][59] - Net loss attributable to common stockholders for Q4 2023 was $9.2 million, or $1.33 per share, compared to a net loss of $8.2 million, or $4.33 per share in Q4 2022 [58] Business Line Data and Key Metrics Changes - The eye care and wound care segment contributed $2.8 million to Q4 2023 sales, while the skincare segment contributed $0.9 million [21] - Year-over-year sales of the eye care and wound care segment grew 9%, driven by higher Avenova sales through physician dispense and OTC channels [23] - Sales and marketing expenses decreased by 17% in 2023, reflecting reduced digital marketing costs [9][57] Market Data and Key Metrics Changes - Subscription-based sales on Amazon and avanova.com accounted for 24% of all online sales in 2023, up from approximately 14% in 2022 [5] - The company is expanding into the EU market through partnerships with distributors, leveraging its established brand [12] Company Strategy and Development Direction - The company has streamlined its operations by divesting the DERMAdoctor skincare business to focus on higher growth opportunities in the eye care segment [4][60] - A new co-marketing agreement with Eyenovia aims to enhance the marketing of Avenova and leverage the FDA-approved Clobetasol product [6][20] - The strategy for 2024 emphasizes leveraging the physician dispense channel to increase Avenova brand visibility and sales [30][44] Management's Comments on Operating Environment and Future Outlook - Management acknowledged uncertainty in the broader economy affecting operations and financial results, emphasizing the need for adaptability [2] - The company is optimistic about the growth potential of Avenova and plans to focus on partnerships for product innovation rather than in-house R&D [32][54] Other Important Information - Cash and cash equivalents stood at $3.1 million as of December 31, 2023, with $1.1 million received from the DERMAdoctor divestiture [24] - Non-cash impairment charges related to the DERMAdoctor business were recorded at $2.6 million for 2023 [9][22] Q&A Session Summary Question: Can you discuss the partnership with Sonoma and EU expansion? - The company is working with Sonoma to expand into the EU by approaching various distributors [12] Question: Will revenue breakdowns by distribution channel be provided? - The company typically does not break out revenues by distribution channel but may provide commentary as sales grow [13] Question: What is the focus for new product launches? - The company will not focus on new product development internally but will seek innovation through partnerships [48] Question: How is the digital marketing strategy changing for 2024? - The strategy has shifted from direct-to-consumer sales to leveraging physician recommendations and partnerships for growth [31][44]