CDXC - Earnings call transcript Q4 2019

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the ChromaDex Corporation's Fourth Quarter 2019 Earnings Conference Call. My name is Chris and I’ll be your conference operator today. At this time, all participants are in a listen-only mode. And as a reminder, this conference call is being recorded. This afternoon, ChromaDex issued a news release announcing the Company’s financial results for the fourth quarter 2019.

reviewed sections both at not any available have relations investor ChromaDex’s you this are information with If website. www.chromadex.com.

Investor President I the would FP&A Vice conference turn go and of call over Ms. now to Brianna like Gerber. Relations. Please to ahead, Gerber,

Brianna Gerber

Good Rob to ChromaDex afternoon, and Executive Frank Fried; results Founder quarter Corporation's ChromaDex's are Chief welcome us Kevin Jaksch; With and call. today and Farr. Financial Chief you. fourth XXXX Thank investor Executive Officer, Officer, Chairman,

statements, results including expansion development, of forward-looking related trials, Today's to plans, Niagen and conference ChromaDex's that in investor as include filings, operation. ChromaDex's of call as markets, and future timing research anticipated statements and Tru of and subject future, are in future ChromaDex's may the operating the sale opportunities regulatory of future the performance of new uncertainties trial future business the business clinical cash financial timing and results, relating interest the well results risks development to and opportunities, and to prospects needs, future such

ChromaDex's could risks These on statements. report forward-looking the or results those and risks the with to recently yet only actual annual ChromaDex's results are are the and date that subject this Because most factors the of Company's factors future uncertainties. in in anticipated assurance statements on to not contained statements activities to to estimates call, results. Many forward-looking relate SEC. activities cause Form represent give have differ actual and intended conference as filed occurred, to materially not these statements any matters include inherently XX-K, Forward-looking from

statements the no conference of in actual assumes or forward-looking call expectations. to the forward-looking to that note obligation date to with Company this update its results changes statements, conform the Please after any

call In the reconciliations the are release, measures. of appropriate presented this and earnings Company's financial website, were presentation addition, present this to which Company's non-GAAP and available earnings in on press the measures. references financial issued The information certain afternoon GAAP

conference Relation this call via is www.chromadex.com. webcast. the will recorded of Investor The website section being at webcast at Finally, our be available

With call Fried. Rob? turn the that, to Executive it's now my our pleasure Officer, Chief to Rob over

Rob Fried

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

total million. increased had and net of sales another XX% net increase year-over-year. Overall $XX.X sales and X% sales with Tru X% XX% increase $XX.X a quarter strong were sequentially, million, a year-over-year. We sequentially Niagen

Let sales. on me net the not We a comment briefly coronavirus. do anticipate significant impact first on

store the and quarter. Watsons do However, first represented in not of down at impact in in anticipate Hong We expect Kong. the sales Tourism net traffic and we fourth time. quarter supply moderate this is impact XX% a chain a do

number Number said and past, own the two, brand; the have are to science; our focus build to on the global three to one, we fundamentals. in business to pillars As there number strategy: a three,

Let's start brand. the with

XX% net As represented $XX.X sales a quarter, in $XX.X the XX% year-over-year. sequentially quarter. the a increase $X.X mentioned, million X% of Niagen global Tru XX% and the and and Niagen saw Tru were sequentially increase increase million year-over-year. net XX% sales net sales million, E-commerce increase in of a

we XXXX year three $XX.X last were proud we've accomplished what very Niagen Tru full For years levels. in year's net million, I'm roughly short double of since this sales the brand. launched

in and New cross Singapore, our fourth net to quarter. Zealand Watsons from This Hong Tru and partners sales Kong border truly sales China in Japan, includes and with sales international in XX% Niagen Canada. become in markets of sales has approximately in global to the

UK expanding now into are We Australia in first the and quarter the XXXX. of

to previous largely the slight remained Hong a a driven XX/XX quarter, due Watsons the Sales in million decrease strong, successful primarily by Kong $X.X promotion. to the were Watsons quarter, protests. fourth versus point-of-sale

generated $XX.X these net small sales U.S. and XX% sequentially with growing grew an sales increase. business majority the but year, for e-commerce our Our million from $X.X sales. business from XX% contribution of border the of quarter were cross to a in The million international

and the is fitness introduced build our healthcare Anti-Aging Academy largest or practitioners the In Medicine, year. worldwide to business groups. care and This available of December, professionals Niagen American health we shows and serving XXX Tru exclusive HCPs continue proactive We influential one trade for Niagen of new to Pro the our with Tru of HCP to at the practitioners. represents largest

fitness professional taking of Niagen base Tru growing as a athletes professional well. today trainers have We and

are brand build strong our we to continuing Additionally, with global partnerships.

sell an health initial UK. for to Tru First, leading with and test Niagen beauty an XXX we retail time. a in broader over the over launch distribution agreement in chain stores the signed with represents This potential

presentations support Summit and We Summit. with page. Health brand at influencer our media the market with the campaigns awareness existing as as drive product London scientific social education launch education, Optimization and to the of XXXX and UK will We in half early in Food both, the well optimize PR, Matters began second Amazon

Additionally, job Zealand, this an Matakana Niagen New we has in month. and include relationship distribution excellent in Australia. done in will SuperFoods they upon built Matakana Australia to our with Tru rights launch

of world. has one in capita supplements highest the consumption Australia the dietary per of

this loose are Niagen launch for an launch in in begin We to to Marketing format. in are second Nestlé be Tru the online The launch half will be powder and the its Health business with in proud year. will initial test efforts of with year. excited expected mid-XXXX Science plans

decline the a it have impact Nestlé a and material cells are very age with Nestlé trend. And of addressing growing While positioned is for NAD. Niagen that will Tru believe awareness important. this results, on to build we foundationally that stress well processes cellular nutrition partnering and by We is and XXXX with our not under cellular within

liquid clause end agreement, exit an This by was had XXXX. a or in technical expired. not Nestlé clause achieved stability the in of has our feasibility

achieved. will proactively although this are to we continue liquid or be We on if to as when work stability uncertain

three-year Nutrition. spokesperson. Persona into Nestlé Persona Ripa service its Niagen personalized expanded Tru nutritional as supplement customized Last recently and and last vitamin partnership Kelly month launched our service, supply a announced new acquired we with its month, nutrition by delivery their signing with agreement

its Like to ingredients commitment Persona high paired and research. science Nestlé, with parent quality trusted shares peer our reviewed company

core to is objective own science. the second Our

We new be a published well as with explain NR studies registered in nicotinamide the to why update. continue superior to moment, in science our several will and behind these riboside ingredient last since the confident NMN. Frank summarize as is

includes build continue developments our protect also property, and to Health. litigation momentum XXXX. We our were ongoing several upon There intellectual Elysium against in early which and positive

in offense cases. We are on all

Judge the confidential fiduciary summary regarding Connolly Morris. information the secrets of Elysium broader and January, at for on our motions well trade as by duty First, claims breach in hearing as theft allowed in Mark judgment California, and of

award $XX million an request with damages May of for We will the ask for a in punitive damages. The along set jury XXth. roughly compensatory trial for is

case our to update Elysium conference patent in forward stay and to we Dartmouth place infringement with granted motion Delaware. Connolly the in from A our scheduling attorneys. an look our lift Judge Second, against is taking today,

Judge reassigned J. the York recused from Liman. Lewis McMahon herself was Third, New case to and judge

Office, ChromaDex patents. Dartmouth’s appeals Act of respected this Patent held and exclusively We composition matters of the the Lanham week, forward on the trustees We discovery patents York upheld court NR the the by are case of NR decision isolated which U.S. affirmed by and of licensed Trademark validity last late the of matter These Dartmouth LTL, ChromaDex. federal in representing trial we our and new attorneys are trial. and been engage confident complete some as other for on New have also counsel to time. and case, move very in And

and With are that federal will patent court to our of infringement proceeding appeals against now our with pursue vigorously Elysium action Delaware. against claims affirmation, we Elysium in continue legal

This triggers from statutory IPR. arguments that raising important have court during in any patent prevent district that could Elysium raised of will because of or the federal appeals appeals raised decision affirmance the the court estoppel is reasonably it a court invalidity

all We are confident cases and facts trial. are in increasingly of get to the to eager three

third pillar on to Our is strategic focus fundamentals.

a Australia, we mentioned respectively. key the an regulatory NR, and and exclusivity, from from streak acceptance includes of precursor. other of two-year points novel successful As of five continues any This secured unprecedented any NAD which regulatory differentiation earlier, EU approvals

commitment in of continue The we consumer which recent testament to a quality pace champion approvals to our industry. science, safety, regulatory the to and is

focus have some operations internal systems. improvements quarter, processes, We management changes improvements in placed on our including in in in supply chain the fourth personnel, much also and IT

in that quality, some to a our this board to member an industry board of with quarter Products influence our of is our Council business to Nutrition. member Association by G&A and is I requires mission this the Responsible opportunity changes this should time. this contributed became our and lead There investment the our a science. in the to messaging, For in the others example higher us Frank industry. Natural While It over is quarter, more expense grow allow effectively

are continues to very of proud going Science we the fourth build, opportunity and market our in is tremendous XXXX. global. the quarter summary, is Tru full Niagen accomplishments year In and

value. We in trust team their investors this put deliver management consumers and are their who our grateful trust our put in our who to brand to to shareholder

pass over research. Frank Chairman, Now, call for Jaksch I the scientific will our an to on update

Frank Jaksch

Thank you, Rob.

the are is As to science, at research. are the and forefront body to It and on this world's scientists. authority time to remaining partner core a our research, we growing own is one committed be leading Rob NR of with scientific an we proud global the exciting objectives of stated, NAD of and to

ingredients There are with clinical more up This additional trials the last registered are to X the with is XX XXX of other effects XX. more quarter. than ongoing, and published in NR update. of approximately total collaborations, finished research signed XX clinical investigate pharmacokinetics therapeutic currently registered than last compared to our NR. for a to by clinicaltrials.gov and completed on trials test combination We An X quarter

is precursor and the communities. the growing is boosting we beyond Rob clinical proven reviewed in NAD. be world NAD scientific is journals trials tipping to in using efficacious reaching core reviewed NR point said, top published awareness in scientific peer showing that around in only NAD been tier already well-tolerated with clinical have believe As an safe, NAD the humans. a X interest Niagen and peer increase Biohacker

Another in doses administered nicotinamide NMN first that that or subjects. on clinical NAD NMN. study the published to I mononucleotide mentioned, of precursor single to clinical male is healthy trials X gained previously Niagen recently attention recently has researchers which XX was contrast the six In

While this daily tolerability levels. NMN single measure not oral it of measure not tolerability any if Furthermore, effect, in did established NMN’s supplementation. doses did humans, NAD of it on the of oral

to no alternative In are is peer it compounds known NMN transporters addition, group efficient Previously must entering reviewed a studies. an published presence NR to demonstrated published which phosphate cells This believe before NMN we convert have has as that the as that reason NMN, the is due on directly. to NR of to by less the multiple NMN. prevents there phosphorylated research as for from such suggested entering cell.

NMN they replicated. in In However, a and if an small researchers We for be mice. study, are it refute. flaws to that meantime, pathway of have recent design, is in the well-established interested intestine study can NR transporter in believe the and the be claimed the see there we'll identified beyond

our been Furthermore, notification FDA successfully the ChromaDex build uncertain. in business we for NDI has XXXX, the a NMN than precursor contrast, XXXX. ingredient Niagen In NMN NMN. is chose NR, for We've NR supported following to in rather of dietary with as industry. Beginning in no on the acceptability was use since for is the around the the license such virtually notifications patents science. by filed the FDA, regulatory research unprecedented which NAD two been with dietary and because supplements filed

as there reasons is proven scientifically then are take over understanding the to no Our NMN for it that is NR. which is same consumers today,

Institute interpretation age-related between Institute highlight hearing demonstrated It since preventing the Cockayne published member dose auditory Copenhagen. supplementation of NR from Deafness National model supplementation and at the syndrome, study reduction the the dependent to preclinical on NR and journal a loss or in I'll we National effects required sounds Nature the was mechanisms would confirm preclinical to a Journals. results’ a in published NIH’s demonstrating in help disease, further scientists spoke. study an humans. reducing collaboration January, Aging, of these These are In mouse Partner of aging was and of Other loss Disorders University interesting The in aiding on last for on and neurotransmission though study findings these your brain. and reinforced loss, suggest may of in short-term NR Communication mice recent earlier in the delaying studies a hearing by NR hearing and findings

to years similar preventative one-third approximately The no is experienced syndrome patients adults hearing between XX is ages by today. Cockayne XX age-related measures the and old. There the by available experienced of hearing loss are loss that of

represents potential So, intriguing an area health future with research NR public implications. of

on trial touch clinical newly spoke. registered Finally, last I'll briefly our since we

First, use cystic in November, study in Commonwealth individuals with Virginia fibrosis of is individuals. University to impacts fibrosis. supplements was examine the antioxidant resveratrol study whether cystic patients, NR as comparing by a healthy both use registered of placebo-controlled well This in intolerance exercise as and the

Ataxia a exercise is registered in effect In secondary of December, to aerobic exercising to Philadelphia of of increased measure in to a homeostasis Friedreich's study measure Hospital the in risk glucose therefore, leads Children's combining was and this NR Ataxia. in effect objective by Friedreich's NIH capacity and diabetes, NR of key population. the

of as health for importance increased NR this in interest on population. source on critical due and studying a Glucose published the seen to glucose exercise ongoing recently studies, is We've homeostasis the preclinical and central effects an this importance specific of in study of interesting is energy. of human

Lastly, inflammation. activation in was of supplementation Lung Institute. in chronic study, February, and causes researchers the to NR system investigate psoriasis skin National immune In to a people on the blood moderate the evaluate by with psoriasis. NIH, in aim pilot to Blood effect the Heart, registered mild immune of study Psoriasis improve can and function whether NR

elevate the in In the There's remaining NAD ChromaDex Niagen conversation. other growing efficacious is the scientific NR, health to NAD safest We summary, and sports that influencers. precursor interest among and to cellular and NAD. in NR NAD or doctors, community, teams most committed is believe leader the

opportunity a positively to future tremendous forward about to have general which incredible impact health. I’ll We educate sharing public potential molecule, more the look has this human updates. to the in

Kevin I'll the call to that, Farr. pass With Kevin?

Kevin Farr

Frank. you, Thank

and XXXX continued results against full and in receivables metrics outlook outstanding growth the top for quarter year key X.X improvements our our write-off fourth our Elysium. look sequential with significant progress objectives. on year growth G&A latest of line in controlled including. at year-over-year, gross financial and financial reflect efficiency We Strong across quarter delivered all XXXX, financial full fourth Let's margins, a in excluding million advertising the which our for

three write based This reflects receivables does not The our the and XXXX. raise. financial conservative impact, But the return determination unsealed cases. entire recently conservative potential accounting Elysium's impact in on end accounting assessment or our approach. have no strategy, to of announced litigation treatment we investment off all subsequently a statements made substantiation capital $XX through the million since year They on of financial the we took

reflects Overall, our substantial decline a of excluding basis adjusted marketing measured fourth million, expense, legal which due planned underlying and as to business the R&D. EBITDA performance in loss a by for quarter, a year-over-year, on $X.X was investments sequential progress the

help of Lastly, investments. strengthened cash, committed quarter we $X credit to ended $XX.X a the sheet by to securing in million and year line the working manage third million our with roughly equal capital balance

not the credit line did quarter. on in of the draw We

in ended ChromaDex XX, up net quarter reported border were the X% to growth sales and up million, compared solid compared the XXXX, at Niagen the XXXX, months quarter year-over-year with cross of to quarter. were third down $X.X slightly $XX.X up in sales and sales by last fourth three million sales $XX.X or December of sequentially grew Watsons the XX% X% Watsons’ Tru across year-over-year. the million XXXX. remained of the net U.S. XX% For versus e-commerce, launches international diversified quarter Year-over-year

see selling promotional sales consumer sequentially the XX/XX restocking XXXX takeaway we quarter customers. in demand year-over-year strong reflected Sales to season. well inventory XX% by the driven fourth consumer in Niagen the as quarter, solid from Total In anticipation successful our and continued from takeaway, low and third holiday programs. the XX% levels XX/XX Watsons to as were of strong with up

third to Increased and compared Turning quarter We XX% XX% factors XXXX. in to increased was XXXX both product gross gross P&L. product a quarter Niagen margin gross up fourth cost from a XXXX. On XX% sequential these drove in in of in in fourth sales the XX% of the believe consumer margins. points of XXXX. represent to our rest initiatives savings basis the basis XXX the points of the Year-over-year basis, XXX tailwind by a margins gross to improvement Tru the to margins and quarter of

onetime third sequential a up On the a fourth This quarter was includes expenses debt non-cash of basis, million our for bad total for Elysium to compared operating receivable. XXXX. XXXX the charge million, quarter of $X.X million $X.X $XX.X of

million third expenses of $X marketing $X.X point quarter the million and XXXX in up to of fourth selling compared Our the to XXXX. million $X.X were quarter in

of points return while marketing third quarter versus Niagen this customer expenditure efficiency percentage in growth sales progress our continued business, investing both in in in by improving of the the initiatives quarter driven XXXX. U.S. internationally. basis a net the and made new to XX drive was As Tru growth, up strong We customer in fourth

G&A expenses Health. XXXX, In to related were was bad G&A million as up the of expense $X of in reported, the fourth debt million with to XXXX. $X.X the third $XX.X XXXX, of the million Including roughly flat quarter quarter the third $X.X quarter debt Elysium million bad versus excluding write-off,

most scheduled the trial related to in legal for of trial preparation, current lower due with we quarter expense the XXXX XXth. trial. the expected, May the of quarter incur California delays costs will is We second but As in in completed higher the

and expense third quarter was XXXX. fees $X.X the million, of by G&A $X.X debt fourth equity bad million million higher Excluding quarter versus of $X.X legal XXXX of compensation expense,

Tru investments implementation process of our ERP in reduce business, the in initiatives. processes, These resulting derive efficiencies new Niagen expense as higher XXXX will G&A that a improvement and manual growth well beyond. the The system in included royalties, higher include from sequential as

fourth million operating For a sequential XXXX, the million, $X.X loss slight improvement. $X.X bad of third the of quarter expense versus of $X.X excluding quarter XXXX, was our in million debt

As reported, our operating loss was $X.X million.

for as or net net of XXXX. net third bad a loss The per share, a common debt loss fourth a attributable includes the $X.XX $X.XX loss to the fourth $X.XX expense. $X.X quarter of stockholders quarter per for of million, The share a share million of XXXX per to share loss per compared or loss was $X.X quarter

flow to demonstrate cash our As we've sequential important on trends said, we it's focus believe towards to progress business in breakeven.

To help new to year, financial adjusted measure non-GAAP excluding a reconciliation in We've slide our performance GAAP introduced included investors gauge legal measure, a the EBITDA earnings better of last we business, underlying total the expense. our presentation. appropriate

Litigation expense represents the majority spend today. our of legal

we are excluding to since after total EBITDA adjusted legal completed. significantly decline trials are We expect spending from it the

our an In the investments believe delivered severance will of net We restructuring XXXX, in sustainable to to changes. of end cost related savings. began excluding quarter bottom-line contribute in and late-XXXX supply These to realignment and fourth include activities chain, to actions will we severance these be the measurable of end The headcount beyond. XXXX, quarter reduce expenses these organizational expenses headcount of incurred accrual that as redundancies. related severance of well first including as majority our restructuring evaluation the results were

in details are severance year XX and call. The savings that provide tied to will related quarter's to cash for months. cost and be $XXX,XXX paid full next fourth the quarter. specific majority these We're restructuring excluding payments expenses projects. more over These on the charges accounted of only next investments targets on associated our We'll

across system manual As I an are Company. the excluded not from the slightly ERP such improvement process as implementing encourage to also quarter we EBITDA. higher in expenses processes initiatives, G&A related automates These being that adjusted mentioned, expenses

the related non-cash exclude We bad debt also Elysium one-time expense.

non-cash loss, income defines as or amortization, restructuring is expenses. adjusted compensation related EBITDA expense, interest, total expenses legal ChromaDex and legal debt adjusted severance which net for tax, and income expense summary, Elysium, excluding bad stock In costs, depreciation, to total

R&D quarter quarter million expenses marketing, legal loss XXXX, projects, includes to planned of improvement the a third process current strategic a and compared initiatives. slightly loss total The of to of excluding quarter EBITDA of in fourth Adjusted investments was in up in $X.X the XXXX. million $X.X

XXXX million gross loss XXXX. fourth versus XXXX quarter $X in a by fourth $X.X improvement million The the efficiency higher in we primarily marketing Year-over-year, delivered sales the fourth quarter driven margins and of a of of year-over-year. and was improvement quarter of improved the in

in was Moving fourth $XX.X in with $X.X solid to We XXXX. a use to cash source which quarter to third cash quarter the The roughly cash lower quarter $X.X in quarter outflows flow. was $X.X in quarter to XXXX, cash balance of were XXXX. net by the in and increase balance. source of the quarter the the the payable, lower cash accounts flat cash of sheet XXXX $X.X a capital, of in from of In expectations, was compared the invested to cash of quarter balance related ended purchases million ingredient sheet operations legal with million, of this XXXX driven of fourth our fourth payments. Consistent cash used Niagen higher due versus loss the inventory operating with working activities fourth in the million million third our quarter an XXXX third million for of largely as and we a

P&L year let's full XXXX for year at Now, XXXX. look full our expectations versus

favorable mix of of business. Gross design roughly was expansion services the standards business, due growing net including accounted for from e-commerce e-commerce reference a which $XXX,XXX such such the growth sales, XXXX Nutrition. segment. slight This as in new product and line, our markets moderation analytical by driven margin and to our market anticipate We business in million growth business, late due U.S. regulatory platforms UK quarter, the million We base awareness top growth XXXX, in international changes initiatives. chain rate An marketing expect new including as new of strong larger XX% Persona $X cost Australia, $X increase from coronavirus in to the additional divesting impact first expenses our selling investment and savings consulting to business XXXX and our supply in and the Spherix impact and in revenues, Watsons of in the implemented launches. the and in brand

improvement driven continued of selling expenses percentage We customer strong and sales marketing as in by net retention. a expect

and will be by comparable severance Lastly, Elysium we to bad expense expect expense expenses, G&A the up $X expenses, XXXX G&A XXXX. debt million restructuring excluding year-over-year million and in legal excluding $X

the and HR, Company second IT, run of and Consistent the increased with for XXXX the plan in longer in we half which finance term, our to invested rate our personnel scale XXXX. key for expense

As to I mentioned, and enable going Severance be expect we efficiently our and processes G&A. new to expense us more reported included scale systems in restructuring forward. will

yet charges X set, severance be our We're expense will excluding outlook. organizational $XXX,XXX. realignment X outlook driven quarter makes excluding trial our the our expense and and weighed approximately by to not also severance We of be predict. the restructuring financial it from to But, as to initiative. difficult restructuring I it estimate which previously indicated, first We're dates quarter, first have legal since from the been

Adjusted EBIT key total expense excluding a metric. legal remains

this to expect We improve throughout year. the

higher costs the $XX legal to near-term, cash operating the Total revenues, of driven ends if the litigation $XX breakeven will continue to believe higher be We we expense. at million and flow million litigation can in decline. expense achieve by

we’re offset our be working closer to million XX% to sales better the of will of the $XX on we deliver upper end unchanged In all P&L that overall continue costs $XX gross and breakeven is to this do If framework levers than important objective. savings range. the the cost million slightly deliver margins manage the So, to not decline, to are initiatives to legal may this. in help short,

cash outlook, breakeven, we have including reach our Based $X to of credit. current flow million believe enough cash we our upon line financial

I and expenses quarter, said not as and could of in needs. predictable However, litigation timing are cash change last magnitude our terms

from impact first any sales chain disruption. expect do currently coronavirus. As previously not in anticipating quarter mentioned, we're We currently the supply

have safety sufficient have We place and production. for in contingency plans upcoming goods finished of stock

see, sound As the continue for you on include operation building which focus long to we can fundamentals, term. the a

today. a company much are We stronger

delivering team of highly in possible as soon have We acting of front with mission achieving a greater market on as our remain and building capitalize to to us. a We cash flow global urgency opportunity breakeven committed motivated at who's brand. the

ready Operator, take we're to now questions.

Operator

Your Instructions] is Jeffrey from [Operator from question Cohen Thalmann. Ladenburg first

Jeffrey Cohen

questions. Two

off debt what write-off the on quarter? written there far was what's fourth as behind anything bad So, is balance or as the the Elysium, for

Kevin Farr

zero. is balance The

receivable. off the entire we wrote accounts So,

Jeffrey Cohen

And you timeframes, size then, perhaps [ph] Can Friedreich's secondly, can the of end about the top et you study, talk cetera? NIH talk Ataxia? the points, that for about dosing,

Frank Jaksch

I mute. question? was Sorry, repeat the on Could you

Jeffrey Cohen

[ph] Ataxia as Could the timeframe, for et talk Yes. about Friedreich's study, the size number far patient, cetera? of of endpoints, you top as study NIH dosing,

Frank Jaksch

The study is is small, population small. the

So, you're in study. XX people dealing with like around the

Jeffrey Cohen

number And then, about will for timeframe. you the market guys me. or You Nestlé Nutrition? talk there come Persona bit be to one a little little talk the Could And bit, a that lastly as year, about the talk will and channel using about, be channels? they a of be Persona they’ll this

Rob Fried

So, Persona is already launched.

available. is it So,

also offer product to to we expect that of riboside. You can will in us. today. a form buy version Tru Niagen order first sale a test powder That'll September. of for through be nicotinamide their personalized medicine nutrition Nestlé a small consumers online offering They've launch their in already placed an No,

Jeffrey Cohen

reorders you're as stickiness or through could seeing as your of lastly, you as then, And talk any and trends trends channel the far Amazon? online direct business far about as

Rob Fried

yet We getting stickiness. be higher. with have to and majority very The the revenues reorders. numbers rate effect. not Retention be continue to impressed seems specific and But, in is at to of from high provided time that repurchases this is our we point

Operator

Your next Van Riley. question Jeff B. is with Sinderen from

Jeff Van Sinderen

that's effectively say wanted at feasibility to -- for at just that fair the point the think Is this I year clarify they beyond mentioned been that to technical clause. waived this it Nestlé, you I on point?

Rob Fried

The clause has waived, been yes.

still stability Our ongoing. efforts in is achieve to liquid

Jeff Van Sinderen

it. got Okay,

it? move should to look we at unknown. So, albeit that, forward with that you continue how timing Is

Rob Fried

taken. a whey of protein, There Yes. purling. there's of beading are binding there's is a number of process a the and being There to beating, approaches process

thereof. and of All them -- of combinations we’re all with these are experimenting being

Jeff Van Sinderen

in you And guess, the out the in then, anticipate you've there, launching signed I the beauty in just think you have I regions. steps should we more there? retailer regulatory turning about got EU. the And speak Australia. approval I how product the EU Can to And know, said those regions? and both to next roll in in you retailers

Rob Fried

So starting with UK. the

taking the UK We and are specifically EU in carefully. general

taking in UK, We few financial on are selling sought of the started with I we with into there. some This in in ChromaDex the strategy border partner in this at the by across and earned much the one we supported in and and impact. board. And that our initially are did then, test PR awareness don't We media But, quite and UK, we articles launch. about interesting growing cross doing seeding deal U.S. made received UK. the Niagen good a XXX-store with very are And a a expect a step Amazon Then, like terms time. we is be partner, out we we the and to the material that market it the UK.

and We of in France. and Niagen earned metabolism, are lot and Spain these are NAV cellular talking and in and also a takes And of those to of energy selling cross launch border to awareness -- into attention build resources to local working metabolism region also It time we various in that Germany countries. partners press develop to countries. media of

opportunity an have to only once. You launch

working We're carefully. vigilant. very being are are working we quickly, we So, but

same true Australia. The in is

called have they in relationship that We distributing to in decided excellent have did Australia. infrastructure include an job Zealand. in Australia. New the Zealand job, a did And an to an We extend partner They Matakana. excellent New

riboside Australia. high And into Australia. and quite in fairly a awareness initially bit media already. we've nicotinamide done of and NAD in Australia sales press online some were is There a there earned So, of

begin month. already their launch. there's this So, demand initially that an will in online country. And It will be some Matakana later launch

evolve distribution. later is will that retail expectation it into Our

is China the true same The way. with by

We Tmall. China selling into cross presently border are with

lead entering a approach. to helping We're This regulatory creating the advance are We a new us conversations partnership even strategy getting we China. about have vigilant, and in that having into guide partners is China. cost aggressive for It's careful, talking adopted territories. in to help of those us approval in efficient,

Jeff Van Sinderen

around improved the immune system how you just given to, just And the thinking touched prepared given for that consumer of you for And one backdrop Tru Niagen, in wondering, your comments, then, talked turning awareness about function of I taking the function. immune those are on COVID-XX? that about studies I'm system think potential

Rob Fried

other that energy understand that stress, under when that stress further to importance only that repair the the within this around viruses are and cell. and is trend we to elevating it We we resources the the studying particular this of metabolism, levels. and And cell presently. important We committing Niagen understand the but Tru other not We on viruses. of NAD the that are We understand and elevates it enzymes impact physiological Niagen through working of Tru with world. NAD combat similar a investigating researchers understand this on importance uses

Operator

next Pinheiro Co. is Mitch from with Your Sturdivant & question

Mitch Pinheiro

Couple questions. of

the in name retail partner, UK? you markets. the the By international First, the in its on of sort strategy way, the announced have

Rob Fried

not. to have the have not We day us They asked the yet launch. partner of until announce the

Mitch Pinheiro

have And is this more the number? or that than retailer XXX stores does Okay. just test

Rob Fried

number. is yes, this Yes, both have test Can true. more a be and they

Mitch Pinheiro

Okay.

Foods, a in Whole UK. But visibility that looking considered in States. with Canada retail margin United United wouldn't did -- in But -- at strategy retail you if have you give use and what all the offset this the wouldn't -- States? at an you you unknown partner So, clearly up how there in does be here

Rob Fried

in some sell in the already. retail in Los Juicery. level Macau United called in United Kong And Bristol healthcare We retail We here LA Angeles to the in We're States States. here practitioners partners company of to pressed also on and packs stick Farms Hong in in there basis a here have in and here and Singapore. sell we wholesale a is

slowly the very, we that a of with we chains. this water. of enter level so there's at large not right might time great people we experience right deal are brand and -- dealing very here we the Company we taking and retail are however. are dipped the risk time have have as identity into too carefully The toe when opportunity And and are in it's But retail. are brand our right till go We the there waiting that the unique at that awareness opportunities and big there such of preserving

Mitch Pinheiro

you calls Are retailers? from getting

Rob Fried

We do retailers. get from calls

Mitch Pinheiro

Okay.

regarding question Second Nestlé.

in the a if? in Is ongoing of achieving you Nestlé is it waived, solution it still issue? to to just are how is the clause So, efforts confident you mean, matter the -- I problem. have the solve

Rob Fried

the opportunity. bigger, product that independent an tip interested added would was We in deal even be the be like quite it interesting powder is a let sure We're think liquid we're that format. not the or beverage if as would First, in actually say actually form. format an to me powder the in packs stick that

So, on in riboside it in and test trace found milk. we're curious this this look, amounts we goes. yes, rollout But, -- -- is how is goes product how very nicotinamide

amounts. encapsulation nature has solved encapsulation other issues. the in So, the problem trace in stability has past has beading already worked And in --

problem problem will but get not solved So, And yet. confidence particular no of the been will we be have course, eventually -- it there's has that it that that solved, solved. guarantee

Mitch Pinheiro

market, like -- taken, capsule is format, market think the is that how fitness or is smoothies using fitness in putting they you that that, stick and the do In things are form? in that shakes been in and that's

Rob Fried

Yes. We market it already smoothie. and I both. well, But, format use mean, powder be I will think, is add many it the in it think their to that -- fitness both. people

Mitch Pinheiro

your prepared in Any you can that market, in the update the fitness remarks about besides of talk you tangible talked your XXX? about about sector launch professionals, -- or Pro remarks, anything healthcare the

Rob Fried

healthcare practitioner the in market? market fitness In the or

Mitch Pinheiro

of -- Yes. way. Well, sort either you

Rob Fried

are markets. These two X markets. separate different are These

Mitch Pinheiro

[Multiple Speakers]

Rob Fried

a market that either. tell the We metrics as I only can see demographic. any specific practitioner base. And yet have both the market more see fitness customer wholesale a healthcare provided more in you we are not no, And of is growing. we

Mitch Pinheiro

can flow million the breakeven Last range. $XX the get you Kevin, think $XX cash and Okay. just million -- question, breakeven the to payments revenue in you

litigation mentioned Did sort hear doesn't that end, I correctly? if happen like that of still range. that end You the higher breakeven at could of

Kevin Farr

That's correct, Mitch.

on we're including can we what legal think continue to of litigation get our variable But, on and SG&A that in in of basically what as the make really chain, timing we is over expense. expense the is And terms one time think terms progress predicting to magnitude. supply as I breakeven, expense. it, is well working cash flow

we impact be in very that point this programs hard time, savings flow million flow cash per $X that are be our with to even working cost legal at with respect cash outlook. to at So, could able continuing expense breakeven, to But, to quarter. $X million

Operator

Nagel is question with Oppenheimer. Brian next from Your

Unidentified Analyst

maybe Andrew marketing. question. a a expansion. I expansion that just are add bit on guys talked deeper international there know could commentary Brian’s Hi. can or to about into This from dive dollars? bit there team. going thinking of the Is little But is domestically, just had If just in we be I to specific the strategy you any you little an just shift Chason strategies? [ph] marketing one a

Rob Fried

more points. and on now that the on had the greater a emphasis call The to in marketing amount We is science online, But true the television. change very overall the that and strategy be very, performance-driven, you're heavily creative. brand some we digital the several leadership continues believers. department group we influencers over consistency what in a messaging see And the Facebook, is of Well, months. all based. last established It's of marketing, touch of to going across crux

Operator

is with Your next Wainwright. H.C. from Selvaraju question Ram

Ram Selvaraju

NR. potentially wondering clearer picture start have of there out that have is NR? done, with health that just the studies was specific if occur? emerging the benefits been I number have swiftest you since could be potentially been in obtaining might claims So, at that to to there to play of area a appears juncture, regarding how a this what specific And and sense if what on if a for route of health

Rob Fried

look look that answer. at cardiovascular, to answer the of related. to come have kidney, does of we seeing are data of but studies are But that we still -- of have been happening the to and it We're some that with thus which some then at and like liver, a now, also published see Well, also right some cognition if Frank, support studies and I'll results And consistency. defer consistent unblinded the starting far, level many this. you into some are insight I’ll to you are completion, which if look you

will hopes and expectations Frank, want high contribute in have anything studies you that get for to coming We that? the published to year.

Frank Jaksch

is ties Yes. as review everybody just out claim. a to inflammation which we're hopefully excited broadly, to Rob. on in agree that would only The on data and aging it with come the share front. Obviously, broadly, there's I I'll be, into and ties that messaging for we're one waiting But, to with that peer add story, terms also the challenges others into of other

as doing But, area to into. we have are that's long ways there still which exciting support for of have to an it, think However, as broadly. appropriately, check data it us we I

Ram Selvaraju

proof point, might focuses to of it Further that hearing group? this specifically to Cockayne is be that of not study in syndrome possible specifically attenuate in conduction NR loss, or concept envision on a whether patients to

Frank Jaksch

trial one that. a is way stage potential related be doing it something -- see guise of things you We way ways two NAD, look good effect. it is potentially a Doing we you hearing is of proof That's collaboratively, at it. do which the work formal are concept the IND of one way under that and quantifying clinical Yes. vision would could are of at hearing two on different, the but to will it. look measurable of in vision. an really is and By It can raising measurable loss, sort the

Ram Selvaraju

hearing would Cockayne to possible in right? it possible. damaged, like patients, be this And their do is before That's irrevocably syndrome

Frank Jaksch

proof concept trial. That's a enrolling would is when damage answer, difficult start to you does and in a start, somebody because -- of one when you question the the when

an not particular, recoverable. challenged it's to early health And so, it's these even to whether in kids, in because of hard across age that's assess what of areas all or so these and difficult that kids are damage answer level

Ram Selvaraju

XXXX, though to perhaps what about assume wanted I from impact understood. you on be that could there Okay, your of and for length might kind might ask projections it those of you minor be. coronavirus, the the Could comment that? about time

Rob Fried

Yes.

full first I this think it's really predict. we're there's time I impact right difficult point an in but think quarter, -- to in at now year, the

to that going impact over change it that this isn’t our at forecasts time. full point, year, the could are So, but

Frank Jaksch

negatively. don't candidly also in impact run has the it an We know long or if positively

Ram Selvaraju

interesting. with this associated what the or what and like, if these And those, you initiatives? anticipate so, That’s juncture, further Do Okay. restructuring the at near-term not expenses any on might cards? would that be is look

Rob Fried

at to we're to at get think opportunities supply invest chain the end looking looking end other return. and for to I Well, a

we in across to So, that we're regard continue quarter our distribution a going that supply bottles. fourth our for encapsulate XX-day label also to partners from bottles three working XXXX the We with currently look XPLs. major supply launched in one product. blend was a we're the And made and looking chain bottle. change and with And CMOs the to at

spending The one bottles; on three So then distribution become similar. now, because becomes package we're expenses not bottle. smaller then the we're at spending is the smaller, packaging and

expect on we're across our return a we're making that'll So, for opportunities to ongoing we investment year. Company, if look quick And our an I be other scale reduce think costs a that as and looking costs. payback. restructuring, And and good we this

Ram Selvaraju

respect And the last question to the with trial. May XXth is

you're concluded. the is to avenues In of other And regarding might be possible with is be indication which trial have might to if more things any on rendered? seeing the going outlook in if for you your wake expectation that inclined so what comment words, decision any appeal a understand comment at settle, if far, on. proceeding wanted that timing juncture? what what to that's being have making been the Also, way could Elysium would them that perhaps the Just

Rob Fried

one inclined Their shareholders. We've been behavior our on would We have to unconscionable. they're of in be has satisfactory And to obviously consistently settle. don't lot know, behalf if to any invested this. a us more settlement that's

general. the that facts of be their come comes imagine many in Elysium. have, surprises The It's them me Of I hard facts people are can out, to out, be as nothing come more these it But by confidence get when the surprised less experience again, and public boosted. have course, to I would read. specifically

will that. to May mean, will on me weeks. primary last by further And that their doing an whatever to surprise been if that trial not approximately opportunity appeal, they XXth. would the tactic. have expect tried they decides two delay I we jury It Yes, it that has

Operator

is And with from J.P. our question Research. Mark Equity Farmhouse last

J.P. Mark

here. Just a questions quick couple of

current liquid I You be is that of important the to bigger mentioned this than how an growth the it a or curious know and you've form, how important -- would additive you would the it new it much form, Company? long-term form. got? Is And that's actually could a to to liquid what create is it was about hard opportunity already to how

Rob Fried

beverage. separate. nicotinamide But, meaning nicotinamide exposed and the part to the meal of relationship time, a product in it is liquid-based liquid, break So, the that, over with riboside protein the the replacement initial down achieve thinking we'd they be would order in of have do liquid, stability formulation a that is which to mostly have to Nestlé in called when Boost, ribose to begins

not NR it's other nicotinamide. is but efficacious if half and you're half of harmful, not it's dose taking the a say as So, let's

was So, interested solve to problem. in Nestlé that trying us

are beverages problem only Boost. there We -- many do interested are interesting that because replacement are based. meal there out not right But, not products. are the there they Again, out protein-based to other solving besides that are in beverages there have protein that

So, we see once the it as solved. an problem opportunity, is enormous

a as product is idea, in we've separate the maybe big Boost could Nestlé other just bigger However, with what based or idea. it from a the passage beverages observed be of putting time, is not is Boost to added that maybe powder

sure this opportunities because that pursue. we potential are there business So, much. are science pursue to we're here, stability, we pursue the that continuing not lose But, to

J.P. Mark

not form this getting a that create that important that you're So, point, still liquid? pursuing you necessarily to have liquid it's less is in than Or Am a if right? well trying it, I works powder at a but you're right?

Rob Fried

Right.

Nestlé And product. stable. is powder powder with is the that established the have We forward proceeding

J.P. Mark

I'm pricing. And direct to are there? about guess, you was price know online. strategy how Okay. your second ways online website. or about differences was I on know pricing, And your and your what selling had in I there's through major two question Amazon then, I of was curious curious to

Rob Fried

in across it's on there's and board pricing not of do there course, versus website. that important there's on companies, across we And buying the versus some we pricing and Well, Amazon important Board buying supply is advantage that -- map to the consistency there. it's the an

to not is organic inexpensive that Secondly, lot nicotinamide process. in make. a of chemistry riboside complex There is

level. we major gross down goods. we And we do initiative are But, on on few around experiment goods, retail a some our at as bring months the Company. -- price of see are continue continue reducing at will therefore, to working margins cost XX% retail achieve a been constantly you the And a level, very we do to there that with cost to So, Company do we that level. be. order In testing of the as will have the close and to to last price if has a on price that

J.P. Mark

It discount you? looked same get web to that website, Amazon. the did -- on Is you on you same. be discount online it you get subscribe as go it going wrong? that to Amazon, would, said the should the -- I to buying direct me that if a you your get You Even if you if don't actually do significant versus you're

Rob Fried

In go not Right. cases, sorry. you're sorry, It's looking a It’s X-month one ahead. at. in some I'm I -- cases a -- supply am Go identical it's one to not the ahead. product that

J.P. Mark

reason. lag the audio in delay and sorry. No, the for a I'm There's some here

Rob Fried

subscribe by precisely as limited, but save are match Because to shipping the the and costs we discounts products, limited, is as imperfect it it No. being try Okay. possible. an up Amazon match, the and their ends available

Operator

our now Ladies I’ll Gerber Q&A. any allotted for and closing Brianna to things for turn gentlemen, that time concludes remarks. back over

Brianna Gerber

this everyone, Time X-XXX-XXX-XXXX. X:XX the number and of joining for ID be us continued for beginning replay XXXXXXX. conference at is Thank call is today. you, Pacific you, today And of There'll ChromaDex. support The replay Chris. Thank a your p.m.

Operator

gentlemen, conference call. today's Ladies this conclude and does

your phone may you. And your disconnect You Thank lines. now participation. we appreciate do

ChromaDex (CDXC) 10 Mar 202019 Q4 Earnings call transcript