NEXGEL (NXGL) Q2 2024 earnings summary

Executive summary

• Achieved record Q2 2024 revenue of $1.44 million, up 23.4% year-over-year and 13.8% sequentially, driven by branded consumer products and the Silly George acquisition.

• Silly George contributed significantly, with July Shopify sales exceeding $380,000 and Amazon launch underway.

• Recent acquisitions of Kenkoderm and Silly George expanded the product portfolio into skincare and cosmetics.

• Partnerships with Cintas and STADA, and new product launches, are expected to drive further growth in the second half of 2024.

• Expanded contract manufacturing capacity in Texas, doubling square footage and investing in automation.

Financial highlights

• Q2 2024 revenue: $1.44 million, up 23.4% year-over-year; gross profit: $410,000, up from $175,000 in Q2 2023; gross margin improved to 28.5% from 15%.

• Net loss: $979,000 in Q2 2024, compared to $642,000 in Q2 2023; net loss per share was $0.14 vs. $0.12.

• SG&A expenses rose 57.4% to $1.39 million, mainly due to increased marketing and Amazon fees.

• Cash balance at June 30, 2024: $1.1 million; subsequent $1.11 million financing completed.

• Six-month revenue rose 51.5% year-over-year to $2.71 million, with gross profit up to $687,000 from $117,000.

Outlook and guidance

• Q3 2024 revenue guidance: $2.2 million (up 83% year-over-year); Q4 2024: $2.6 million (up over 140% year-over-year).

• Guidance excludes any revenue from AbbVie partnership, with initial revenues expected in Q1 2025 and ramping through Q3.

• Expectation to approach positive cash flow from operations at higher revenue levels in Q3 and Q4.

• Management expects continued near-term losses but believes recent capital raises provide sufficient liquidity into 2025.

• Focus remains on expanding branded consumer products, contract manufacturing, and exploring new product channels in cosmetics and medical devices.