CDXC - Earnings call transcript Q2 2018

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to ChromaDex Corporation's Second Quarter 2018 Earnings Conference Call. My name is Kevin, and I will be your conference operator today. At this time, all participants are in a listen-only mode.

As a reminder, this conference call is being recorded. This afternoon, ChromaDex issued a news release announcing the company's financial results for the second quarter 2018.

reviewed section both at of not the available www.chromadex.com. have Relations Investor ChromaDex's you this are information, within If Web site to I conference Investor to like Andrew over Relations. would of Johnson, turn Director now call the go ahead, sir. Please

Andrew Johnson

ChromaDex development Executive Thank XXXX to second to and and Officer, today clinical investor ChromaDex's results may business call Rob trial risks to include results uncertainties statements, the you. Chairman, of Executive Financial ChromaDex's us financial quarter expansion future regulatory Founder future conference With in relating future Fried; interest, the research Corporations' and results, future, timing as the welcome Today's business the call. future as related and development studies add opportunities, needs, timing Frank of the TRU and in Good management and are to such subject afternoon, sales to Farr. investor that and performance operations. filings, and Jaksch; Chief Kevin ChromaDex's operating and Officer, of well clinical clinical opportunities, the including plans, team, new future are forward-looking of results statements and trials, NIAGEN ChromaDex's cash trial to markets, plans prospects of anticipated Chief

results activities or represent and not that materially call subject ChromaDex's uncertainties, inherently XX-K company date actual the or call future contained filed matters Because to actual risk its these the These forward-looking date no and the note, and Forward-looking results. with risks give Annual activities to the on expectations. obligation to results SEC. statements assurances the update occurred, most could recently conference statements, those only have of forward-looking to XX-Q, Report as many company's statements Form statements statements cause this assumes are this to from to differ of forward-looking on include after estimates confirm anticipated actual in that the and Please in ChromaDex's any not intended to yet changes any with forward-looking to factors are the factors statements. results relate Form conference

the this which financial is references The company and non-GAAP reconciliations call this the available measures. issued presents of release, was GAAP company's explanation are to Web useful on of information the the presented certain such afternoon why earnings non-GAAP to and site, measures, addition, In in appropriate financial measures believes an investors. financial company's

that, available to call Executive at The the the conference site Finally, is will be Jaksch. our Investor Web webcast. www.chromadex.com. webcast it this With via being now Frank at call is my section of Chairman, recorded to pleasure over Relations turn

Frank Jaksch

thank everyone, Andrew. you, and XXXX second quarter you Good Thank investor joining our afternoon, call. for

Kevin but will aging health the we update and importance take to strong scientific the NIAGEN. how and you details the human will through on the will benefits continued of this research Rob an you first discuss the review expansion into of growth and call, NIAGEN. I expand, of provide the NAD in to surrounding of growth, During NIAGEN the to sales of science our continue TRU of

clinical randomized had the Copenhagen it humans During the XX but are reduction studies XX the this without that on found in new these absolute weeks health. these clinical conducted additional The some only total findings of of very raise potential the of they investigating increases progress. XX. a liver to once we and the the importantly trial of confirms obese collaborations NR observed valuable NIAGEN's published. of in of was authors in look We clinicaltrials.gov and adverse safely to also research in collaborative men the X% to average who independent is placebo. that more the of quarter, compared The men highest results reduction again to looked reduction XXX study exciting taking NIAGEN greater middle-aged NAD fourth showed health. double-blind than the only at previous liver NR published total compared fat an liver of XX-week that results of dose grown in levels number trend trial placebo men corroborate The for that studies clinical that human effects, placebo-controlled NAD thus NIAGEN. on fat X not experienced XX% content study effectively XX% the of grams with parallel absolute fat learning group men of of of levels a with liver NIAGEN has authors the a group. does taking far trial men they signed daily .X% there that This subset improvement human the at University published human The taking second NR in a role a posted areas of in They started and studies forward a NIAGEN finished from quarter after more as X%

-- function key pipeline disease. of May enhanced in second and As E-life in In oxidative few shown Parkinson's NR model stem a damage stress titled into in should fly to on Medicine in XXXX, precursors, coworkers NAD preclinical in metabolic that feature disease mitochondrial which administration mainly a identify May into hematopoietic Society coworkers demonstrated loss boosted is Biology quarter. May media independent cell in in riboside molecule publication in and during of sepsis the fly nicotinamide these Journal muscle publications pathway. and disease mitochondria of sepsis titled understanding [indiscernible] XXXX, the highlight provides reports new NAD Radical stem to study the Free preclinical also In damage of stem of a titled [indiscernible] riboside Annals XXXX, neural function into titled and and coworkers demonstrated further publication Journal titled in prevents a targeting publication model the NIAGEN yield XXXX, in mitochondria XXXX of manner. mitochondrial published NR and publication and At approaches in insights targeted and search in administration published mouse to NAD age survival coworkers the peer continues June the June a time neurons. health science clinical Medicine nicotinamide a attention a of cells NAD disease importing a publication foundation greater cells Mitochondrial additional human improvement the for potential capable demonstrated present are important of that NAD take Endocrine rejuvenating metabolic consumer is to prevents In Parkinson's models. that I’d cell-based transported a a targeting that -- NR like unwanted These combating to in nutraceutical and coworkers review hung the and precursor defects mechanistic in improve that and mitochondrial of model to detailing often happened effects Laboratory -- build the in NAD. in awareness. and cells inform the aging. designed in through reviewed organ the mouse preclinical of injury studies function metabolism the to of that demonstrated the study energy a will In rescues mitochondrial data

of a on and NAD nutraceutical mouse who the of heart details precursor our the circulation that NR human growth growing and of publication in seen a NR, provide overview our that XXXX, of scientific NAD failure. could a and wellness is NR to will of coworkers benefits I failure. With an pass April model incredible give its some of be as cardiac scientific freed, relationship treating a function game diseases this on Rob? cardiomyopathy, literature emerging in NAD heart body CEO, belief preclinical to titled a product. nicotinamide the the in in preserves that, metabolic we've a and will [Indiscernible] most riboside the was including dilated research We target in Finally, validation number is a demonstrated changing efficient call TRU that further NIAGEN. for Rob mouse useful model on see is

Rob Fried

Frank. you, Thank

the trusted on in energy focus Our and impact cellular the supplement NIAGEN dietary mission a its at on most repair. TRU ChromaDex cellular is company to and science-based with world, be

Aging distress in We've excess two NAD. already why to for can of said, NIAGEN. Chief cells actually to NIAGEN of aging, TRU What is pathway riboside NR health and themselves. Frank of cellular also the rapidly of hearing important help help and distress, trauma, of when that a NIAGEN repair, ability diminished apparent production say distress of shown large NIAGEN TRU is general poor shown wide But Dr. and a conditions for words, try they the Scientific specifically that is seek kinase patents in help. age and a and the there's body cells in repair has by to As from growing are is in and much cellular distress, In damage Advisor NAD. Research ChromaDex. better. human by of the sleep, cells comes can repair importance the Brenner essential that nicotinamide underscores other it is cardio of but etcetera, open that cells, dozens health our is the a damage, range research important neurons pathway brain illness, look is the riboside. of evidence kind looking accumulation is is kinase after the exposure, of to they this that essence diet scientific at increase of controlled that us is alcohol, increased story energy. NAD effective Charles of is institutions, pathway nicotinamide to called helping levels This actively the lack cells that pathway, discovery cells, we This sun also NIAGEN of

with turn TRU total XX% In related revenue second second our how the XX% net business let's of up of accounted total NIAGEN NIAGEN revenue to for XX% were of revenue. review Now accounting quarter. the for XX% sales the of revenue and our for performing. NIAGEN related for accounting NIAGEN quarter, is TRU a

expect is continue to this it growth engine. growth. our to We strong NIAGEN we our grow. expect percentage deliver to TRU to is continue brand and It

month. Over NIAGEN growth TRU the of rate see business continued in than quarter, to larger, to time rate this as continued grow XX% may foreseeable we more the per strong the During size a the but at compounded for the growth gets sales expect slow future. of U.S direct-to-consumer

point important the Our time, timing continue TRU branding expect fluctuations strategy significantly quarter. during to first our Hong is or have sales, sales Kong product show dramatic color NIAGEN in we continues Macau quarter of to and Over in second depending increased be compared the await to that and the exciting in specific could in approvals additional consumers and the regulatory this we improve efficient TRU is new $XXX,XXX. to Watsons marketing more dramatically, on that growth. but quarter will working provide was our continue campaigns. the but quarter-to-quarter Singapore although there marketing quarter, second efficiency we to the Taiwan. NIAGEN an to Sell-through on to Kevin were

contract on week, earlier we years. Hong the an agreed extend significantly the distribution over three Macau basis to in with three Watsons and next in committed Watsons Kong grow As to has September sales XX, we've an additional years through XXXX. announced annual our for exclusive

regulatory TRU on year, extend result, the Watsons TRU markets ChromaDex this to beginning NIAGEN Watsons extending Turkey obtain fourth the strategy of effective Watsons in Kong Turkey TRU sell determined in NIAGEN group the Later Watson to desire of see global a for and in Macao, of regulatory brand partly is with on shipments The stores A.S. in our the international successful rights approval. Watsons has The to has distribute NIAGEN course other a NIAGEN is X-year in TRU included approvals. our our to we Watsons Based amendment ChromaDex expansion consistent stores XX,XXX interested worldwide. approval of period NIAGEN XXX other pace of more distribution markets. markets. quarter to of expect to Turkey. in the is regulatory ability into receiving with launch consistent TRU upon to build XXXX. distribution As and a NIAGEN XX in markets to international exclusive new expected international the in obtain to basis by over recent TRU Hong for

Matakana and is direct-to-consumer Zealand manufacturer both New foods online are expected NIAGEN distribution offline we distributor appointed of in As announced Zealand. mid-September earlier week, The this ChromaDex in markets, with in certain cross-border is an of channels. exclusive can as Matakana and in XXXX. established an in in accessed receiving pursuing. markets through New dietary Internet NIAGEN sales, TRU distributor Zealand to approvals TRU be launch regulatory national which New Prior international supplement

Officer. at During such MD of NIAGEN quarter the the U.K dollars in certain year add Amazon second for with half of Asian where Lisa Germany XX including quarter, Marketing President and annual Amazon we each of and years with served began of we Perricone the Chief a as Proactiv, as team in expect as through spent the and executive Beauty, countries Lisa second offering this in well. add The revenue. Marketing. Meaningful may strengthened enterprise, is sale millions Guthy|Renker to our Bratkovich, hundreds she multibillion-dollar addition TRU management Senior of Guthy|Renker, brands Vice the

served David Acquisition. of Vice years at he spent added where David XX Marketing. of President also VP Digital Guthy|Renker Burns as We as

the Let new filed the agreement These XX, for additional on secret well fourth asserting during against evidence are NIAGEN June that we a words information we supply of based supply misappropriation In and XXXX, documents. me discovery. very [indiscernible] disturbing amended say Elysium a new trade claims claims about uncovered agreement ChromaDex complaint litigation. as as Health, and few claims under

and XXXX to look we opportunity As growth. for tremendous we beyond, see

We markets domestically. The how markets into new existing TRU factors of in NIAGEN awareness new the of have of and grow increased partnerships, sales open to multiple increased that markets. the influence approvals, strategic completion include regulatory fast will additional efforts expansion and pace we underway

this over are be. our efficient. the more we I There in to I'd higher investments call cash of to the today getting as I and Before our like overhead would burn One a about cash three bit important out, Kevin, to reasons growth. burn. But why like is marketing talk pointed than it pass ahead is is

focused are which commitments protecting expect to the third target a that the that we on prized much vital R&D TRU is is efforts our past litigation made return the it's But as expensive. Second that today view but spending and the investment now investment. is in course more R&D an believe company of we honoring, We our And we property. NIAGEN. to on company's litigation, this see we intellectual as

expect or summary, be a company is quarter very shortly plan cash by thereafter. working. In of We XXXX positive the flow will generating the the fourth

building new seeing the Farr. sales markets. We are rapid building the science, and I will team we we are that, And into are are call growth, with expanding we our Kevin pass over to

Kevin Farr

you, Rob. Thank

of at the our quarter look Let's financial for second results XXXX.

the NIAGEN. The quarter months June sales from XXXX, TRU to was compared $X.X million the second reported For the operations $X.X ChromaDex by in second XX, of sales increase in in net of of the XX% up quarter XXXX. growth continuing three driven ended million,

margins cost the year. had flat was we second at of on relatively prior impact account XXX compared a of as to NIAGEN the second of the rate. sales For compared XXXX. quarter Gross is quarter the XXXX, this TRU of which second XXX% were of quarter for The in selection margin prior points second to that in related grew of revenues year. handling $X.X compared Gross and second quarter the quarter, second $X.X the our related NIAGEN approximately basis XX% sales million, second by million, represented of XX% adjustments. gross NIAGEN which were profits sales to shipping compared XX% period. and up to on XX% XX.X% compared activities for just to as last quarter impact year the the In negative sales for for X% elected XX% remained revenues to quarter the in XXXX,

the activities for we sales, continue. we of elected and which account experienced to TRU better impact of cost positive shipping impact of Excluding margins as to anticipate handling gross due will sales, NIAGEN

and For of sales. the prior the shipping XX% expected impact margin versus and year, gross exceed rate we balance improve the to of quarters the including activities handling of to net

the our of to million advertising made general million, $X.X marketing to incremental marketing build we with $X.X and quarter incurred as by compensation XXXX, Consistent to million an expenses to $X.X stock-based up from additional Our sales of NIAGEN TRU Compared incremental quarter development administrative for we million the in the operations. expectations, second expenses. expenditures, invested $X.X $X were investments R&D million and in million. research second brand. of $X.X legal prior incremental operating of $XX.X and continuing and expenses period costs the compared and million and Increased expense

the or were marketing a continuing as a share offset up share from of expense $X.X to net XXXX higher operations general of higher ahead million. million or period. higher attributable Excluding higher and compensation the by losses second loss $X.X and $X.XX the and overhead prior compared per decision partially in invest result for year expenses, million strategic million to the which second as loss for profits. $X.X to quarter were million, and common The $X.X to $X.X were stockholders negative a growth, of the volume net negative spending compensation sales the of gross in per compared and $X.XX stock-based was legal administrative prior expenditures of The by legal equity-based quarter

of operating adjusted income the $X.X for million the the negative or the XXXX prior $X.XX EBITDA is and cash net non-GAAP second quarter a the amortization compensation. depreciation, negative was of million a The reported measure for In our period. stock-based compensation. quarter $X.XX and stock negative quarter ChromaDex million for to income versus in which a of share of We million. $X.X as activities a $X.X negative was million EBITDA $XX.X non-cash of of the a dilutive in adjusted prior the balance defines interests, for XXXX per loss tax, XXXX, adjusted of million compared period. solid was basic EBITDA, with sheet second XXXX, adjusted for negative second of impacted negatively $X year. the second non-cash second a XXXX For related loss prior quarter by the charge cash used was a versus Adjusted ended EBITDA quarter $X.X with to net

to the at versus second second million the cash closely The first quarter. $X.X cash related use it $X flows, first higher primarily in $X.X the of our in in more first million to a $X.X was quarter was quarter cash a in capital, which source the outflows cash the compared Looking second outflows quarter cash million in working of whereas million the were the quarter quarter.

for the half of our working half source the tightly million we expect of of capital for to moderate to to the in currently and second net to For cash year. year million the second year working the of be full-year, positive capital full-year, and as $X the the of losses a we balance we expect manage continue $X the as

forward, be efficiently and new continue revenue the company and Looking to expects TRU our launch of in to support well business the The driven growth. brand out NIAGEN U.S new will growth the Watsons in to as the marketing NIAGEN markets. international invest to company by business international certain e-commerce build as TRU expenditures capabilities

property. sales more costs forward, projects. will invest At TRU to as to to necessary, of of In we’re our most expenditures spending. including we this coming R&D of addition, target pharmaceutical the drive across going our to respect had year NIAGEN. With implementing in reduce the to In support cost-cutting commitments the into overall claims first appropriate much half same our past incremental we programs related to XXXX, that the time, we made spending marketing continue company legal the intellectual protect

in investing will We longer this area. be no

tools drive investment continue our support for focus We to expenditures improving management decision better and returns. on marketing to

we our said, and expect significant As quarter, in to of continued a improvement Rob marketing in saw second expenditures efficiency time. see the over improvement we

for and we and continue half outflows moderate of said, I capital the As net in second of the will overall the year. we losses manage to year expect to tightly cash working balance the our

legal key as the in of NIAGEN the leveraging into continued managing our position TRU look and solid NIAGEN, of will get increases in profitability, sales to as we be As spending continued efficiency drivers effectively nitrogen our TRU the the expenditures, company cost a marketing growth fixed of overhead possible.

are company the to we flow. questions. XXXX, operations we’ve would beyond and thereafter. in cash to positive cash very now generating the generate positive upon by take fourth outlook, expect XXXX For quarter currently soon get of to cash fund flows plenty our point to ready we the Based of or current Operator,

Operator

question Thalmann. first with Jeffrey Our Ladenburg from Instructions] [Operator comes Cohen

Jeffrey Cohen

Hi, guys. Can hear okay? me you

Rob Fried

Yes.

Jeffrey Cohen

Perfect.

ran X.X can and firstly, line alluded the back after numbers, percentage them NIAGEN NIAGEN far number was go annual there when then through is first on as as another TRU Kevin as what the Rob time that with through percent then the there as I those you followed up know you to So and them well. and a the top

Kevin Farr

those ahead go me and to let Yes, you. give

to NIAGEN sales. XXX% think to NIAGEN compared I -- up NIAGEN basically XX% XX% XX% sent TRU difficulty] were in that whereas related turn returns related to was to the last were sales sales And sales QX, [technical year NIAGEN XXXX total of you related we of grew the there, it can XXXX. said QX. of And XX% fits turn and million, you we Page was to sales $X.X investment XX,

Jeffrey Cohen

perfect. Okay,

infer products, standards ingredients to our and revenue see from scientific regulatory So consumer there longer we that consultant? should going breakout no and were core by

Kevin Farr

No, so. I don’t think

That with and the gives of XXXX. within the and for you think deck Page is 'XX first broken second that both I sales. to XXXX, out regard net X, information on for quarter

Jeffrey Cohen

Okay.

have least? you the forward, short-term So that change no going will at in in

Kevin Farr

see this I no, don’t point, change. any At

Jeffrey Cohen

margins. the bit shipping Okay, its relation a perfect. And the could you then talk little and about to

the basis so effect -- was the million the and net points talked XXX for $X or You you’re shipping about including quarter?

Kevin Farr

That is correct.

points. rate treat year exclude of was the shipping cost you by sold. cost as XXX negatively quarter, election impacted And the if last made goods we So a gross that our margin basis to that, in essentially

was goods And XX.X, that if at add and year year remarks I’ve in than the in my So was net prepared which that think at in should basis it which XXX as the year-over-year is said actually as consistent margins two higher I each shipping with the back, you of cost increase look as it very above obviously. take of balance XX%. in should include out call, points add XX% we above the this we substantially, and next the be you well sold, quarters of in it see to last we gross the it's XX%, if quarter

Jeffrey Cohen

yes. Okay,

Okay.

thought. through far So it a G&A? your And then, ramifications the than stock of bit better general did a bit far as through as kind give And and on and we on off Rob what the of legal legal as QX, this if you and us expense, or fashion little expecting expense, Kevin, in compensation go level the on can walk color and you quarter currently you're half, at not, the was maybe coming how give process color or QX if it's expense it's pronounced that going back least the could. of to a looks be you compensation stock-based a what little or for more for as us

Kevin Farr

related to the going cost give was it really of the in Okay. on so can't incentive to from comp expenses, first Total occurred were quarter. both and quarter. I’m by $X.X up legal to I G&A, to based Well, we if exclude compensation. million, It legal managed you about predict million equity the what hard very in you was legal with and It's million $X.X direction years comment quarter $X.X regard about costs tightly to the similar that which equity what there. was is that

million the we’re to too that we’ve million second, to the the will year compensation the of shouldn’t you than through expect $X.X occur balance Although and million $X much expense to that, that different it trying equity quarter. this I And for tightly $X think can the proactively. manage be full-year, and be

Jeffrey Cohen

off flow is your end be believe will and call process it, 'XX. firm Okay. clear. which let's cash That point cash, at approximately throwing seems And that probably, commentary six away say quarters Rob, of the you

Rob Fried

so. believe I

We’re shortly thereafter.

Jeffrey Cohen

as Okay. about top a in sense far they’re? a higher XX% is as safe And of the than how on approximately general say line to it as about and to XX% thinking [indiscernible] you’re a kind line, top of relates to it basis quarterly that’s that

Rob Fried

into continued We projections, efficient I more to us cash to are we strong get not expenditures to get more going efficiency NIAGEN, that drive growth from marketing but flow of what’s is think it. going positive TRU

will our little the fixed it, costs, so fixed actually that savings to to that will manage fact reduce more We going I a benefit we programs, look try my to remarks. we’re And costs continue tightly talked from get cost at those then and scale. we about in prepared

are through to opportunities going looking reduce for our structure and We cost overall. spending

are finally expenses also talk looking drive at. And we sales We R&D looking areas in are NIAGEN. bit phase, are a to of to reallocate we that little about this more spending focused

and the for to an savings have being of XXXX or to in for XXXX look beyond savings. look programs additional initiatives and balance And near-term then implemented. for balance savings the the effort process cost specific those ongoing continuing identified as for for been cost have of XXXX of is We well implemented as more there

those thereafter. fourth going the drivers quarter the flow XXXX I are of key get to to So think positive be to by or cash shortly

Jeffrey Cohen

are far or Okay, look it. in months what should hear any as got documentation? you dates as anything the then in -- as on And or lastly, about that as may domain to believe we we should front may specific particular expect or occur the for six happen you legal the coming public what far in

Rob Fried

a we’re there, that months. awaiting It the that come come out we're There's New motions scheduled certain been York, few out to we come for don't from could now at decision but that any going to of right we anything for time. have months. don't waiting is in -- we’ve next There's but

Jeffrey Cohen

perfect. Okay,

questions. taking for Okay, the guys. Thanks

Rob Fried

Thank you.

Operator

question with comes from Our H.C. next Ram Wainwright. Selvaraju

Karthik Sunkesula

the taking questions. for you Thank Hi.

TRU range when be across out of Karthik on this way, entire So in might Ram. the NIAGEN stores rolled for Watsons By is the Asia?

Rob Fried

each issue approvals regulatory do with to there individual The in country. has

not sold marketing be health be get very get get working speak. those that In into are you are a country, And certainly Internet you riboside could presently in we we the as approval you we countries. we to directly working those stores. to are to can as of many into those approval countries in also claims and hard So until can't materials, sales countries both, nicotinamide supplement exploring opportunities sell and in sell some cross-border, of made cases,

Karthik Sunkesula

Great. spur uptake regarding promotional are being what the activities conducted Watsons And specific of to product?

Rob Fried

amount promoting successful. sales know been outdoor done there's lot also been fair extremely Well, a campaigns, of continue of been to over They are has been there's advertising, a we Their developing campaigns TRU an promotional to job promote of have online of excellent as And are of and press, many campaigns. has they and in-store has in tie-in month celebrity that endorser. plans the there's with combination of campaign lot aware sales did one a TRU their of has NIAGEN. a local Kong been you the promotional Watsons has NIAGEN Hong a next

Karthik Sunkesula

near-term more the health? liver nicotinamide about around I call, Frank, know, And on spoke the liver that provide the color health studies you initiatives in riboside in could but probable context revolving study of the Thanks. in will some Okay. earlier more

Rob Fried

you'll is one one Well, on studies to you health. that is studies are particular. liver of kidney. start that postings kidney on looking see definitely two focused are there in that trials.gov, you'll Liver now, another interest, the And now areas right that of check health liver, if notice listed clinical out at an are additional just the that interest are of area health fatty

there's ones along. lot their are got studies studies see So definitely where more of quite posting Heart fatty And provide and study Copenhagen going that a has or I one as that that interest or additional I focus been two to those target one other that think liver, of are of at read the the out to look is the think liver fuel and that and is now of of to were is well. studies were earliest areas going we’ve right kidney for starting but mean, you I kind areas. are issues, health those, of few of a further

Karthik Sunkesula

All moving Thank luck right. best Perfect. and so forward. you much of

Rob Fried

you. Thank

Kevin Farr

Ram. Thanks,

Operator

with Our next comes Dezellem Capital. Tieton from question Bill Instructions] [Operator

Bill Dezellem

and the of couple your to A marketing relative questions first one is here efficiency.

more in do could You front? why you improved that it felt it you the what you quarter. mentioned I and happened on hoping second was detail that can that

Rob Fried

to Well the has of a or majority prospecting you by been convert that when of the large prospected funnel. get of customers. what done campaign interest swaps And order And begin reaching a marketing. series marketing Internet potential, speaking, to is the then the to large you have at out we top digital-based those vast in campaigns do do you of work that, generally you people very groups

we and So NIAGEN. are we done what And TRU a have that successful. lately our visiting large about site people is number interested there we’ve converting who who have and doing learning are been of them, and and been more is very

metrics things and of conversion etcetera. have acquisition like underlying the rate All improved, costs

in net or offline then time seen conversion the cast expect up an program. based go over an prospecting to we and Now may what traditional during we'd and expect or magazines. a might a set other that if you have bit television we some contemplate words, relationship advertising between of In better campaigns investment period better revenue you'd and future of it marketing gotten period. may our and we But net. see system. are we better that that and have better always with is radio and in spend And always the much even in is convert type our wider launch that At point, that or each media, of do that, you accretive brand metrics more campaigns other doing

some but time. those in really wide add very would that prospect done to a expect to again, be casting net, yet, that be point We we thereafter And working we customers. shortly convert then of haven't but would

Bill Dezellem

was That’s helpful, relative then sell-through in Watsons, the quarter? you. Thank the to And Rob. what

Kevin Farr

quarter, -- I the the the Yes, perspective second that up bottles the think our in you in was to versus it versus quarter. digits it quarter average sequentially of the in amount sell, if of sell-through was look quarter we the where double the first from

Bill Dezellem

Thank XXX,XXX sell-in? was That’s relative the And you, helpful. plus amount what the to of Kevin.

Kevin Farr

much that. would be than It more

we're really seen but seeing be mean I is I So, overall think we've reorders think good I XXXX -- slower, for to it the sell-through. yes,

Bill Dezellem

needs approval. done a And lastly, What this or both regulatory more that game Congratulations. then front and Taiwan Great. point? simply you at it be Singapore that had to requiring is on mentioned waiting

Rob Fried

are Taiwan, of soon. -- riboside at Singapore. that the -- than case of as should we the nicotinamide and getting in slightly further materials waiting we supplement. those stage. of marketing countries. are In Taiwan to its okay we Taiwan In be one well away material related more in think that's in marketing the a they’re need in relatively think mostly get and But process different still regulatory thresholds unique each it's we're We game. Singapore, its we a Singapore, in and And approval approved a

Bill Dezellem

for I you. to into step Thank or now? couple questions Great. ask more time we back And queue me shall a do have

Rob Fried

ask can you more. No, a couple

Bill Dezellem

Great. Thank you.

market? next go why that Turkey, the the So dynamics of Watsons? relative was What that spot with to to that you are chose

Rob Fried

factors. There are a Turkey get that to approvals. number regulatory of would is that easier we be believed One

So that is into Watsons second Turkey. Turkey -- -- stores was to wanted and had expand and in

entry though there relative itself market why ease next. larger and as even be Turkey others, we reasons some the as Watsons So went territory that in not of exploiting interest were may

call good. is phone which know that of to little say us one Turkey right on are than got day it's to any a notify number You now, -- know and there from given countries a you’re are others. hard We we any pursuing going that earlier

Bill Dezellem

then? So regulatory now the you have approval

Rob Fried

we to enough the to are worked be some where details point it. obviously, out. There we still got to were But comfortable technical say Preliminarily.

Bill Dezellem

how then guess on helpful. that to is there, locations chose with Zealand other you difficulty] partner them? New and you or That for continue [technical your to countries [indiscernible] And what I did extension relative Great. they natural have

Kevin Farr

to in. Zealand happen interested to business this able thought is only like do company we Zealand. New be And that regulatory able was be them reasons. third, That were get learn. But New sort for population interesting of a goes important a country. approval excellent vitamin, opportunity to consumer very, New thought in excellent vitamin company, from for relationship a a we be every learn and Australian how day. again, and to there. Turkey to test One place XX% and to We to the as good which would would for have we market us that Australia in. purchases Zealand one thought is, which New with sell it see we an an Zealand see we’re New of We Zealand country interesting very of No, number in neighboring there and some is an a is

Bill Dezellem

time. I all the it. Great. for appreciate Thank you

Rob Fried

Sure.

Operator

concludes That … the you. Thank

Rob Fried

Yes, go ahead.

Operator

hand Thank to concludes session would over you. I the closing. Q&A for the Johnson to That like Andrew back today. call

Andrew Johnson

Thank you, operator.

reminder, can webcast. our a a www.chromadex.com. everyone our call you there be Have found Investor section day. Relations at a Web will of this on As on replay call. webcast be participating of via The link great for today's site Thank

Operator

Ladies presentation. and gentlemen, that conclude today's

may You a day. have and wonderful now disconnect

ChromaDex (CDXC) 9 Aug 182018 Q2 Earnings call transcript