CDXC - Earnings call transcript Q2 2021

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Operator

Ladies and gentlemen, thank you for standing by and welcome to ChromaDex Corporation’s Second Quarter 2021 Earnings Conference Call. My name is Ashley and I will be the 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 second quarter of 2021.

reviewed section both www.chromadex.com. at not the available have Relations Investor ChromaDex’s you this are information, within If website at would of turn Brianna to now call I to over the Gerber, and Finance conference President Investor Relations. Vice like ahead go Please Ms. Gerber.

Brianna Gerber

include welcome and plans, Chief timing Today’s today anticipated Tru XXXX cash results Executive business us research performance, investor expansion and ChromaDex Corporation of ChromaDex’s clinical as opportunities, in Chairman, of statements, Founder Financial prospects and Chief trial the Farr. of needs, operating Executive forward-looking Frank afternoon results Good and second may related of sale business the results, call. and Niagen such investor Officer timing trials, financial and statements you. the Kevin to conference development to well the filings, and of Thank Fried; Jaksch; interest With are new quarter results including Officer, as Rob ChromaDex’s regulatory opportunities future operation. markets, and and future

subject changes call the operations, our ChromaDex’s this effect of financial assumes any in to company represent to its the These that update filed risk could statements yet Because conference on the to the the the to actual intended forward-looking with obligation include results Quarterly of occurred, not these flows. results conference statement and as on company’s only cash recently most to anticipated any with on forward-looking date estimates after this pandemic statements. and SEC, assurance those from results Please in statements conform statement, Report condition or are factors forward-looking ChromaDex’s the contained are and uncertainties. Many materially not relate factors actual note expectation. differ risks matters statements actual Form in result give inherently that future XX-Q, cause call forward-looking to date to COVID-XX the or results. have of including the of activities to activities business, and Forward-looking no

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

Finally, our via will this Rob? now being conference available is our at Relations the The www.chromadex.com. the recorded Chief With webcast section Rob Officer, call Investor my be turn Executive Fried. webcast. over pleasure website to it’s call that, to at of

Rob Fried

direct-to-consumer Niagen second existing It Brianna. our sales EBITDA, everyone adjusted you, were Science, Niagen continued ingredient launched in shipment where We new a and the the first strategic Nestle Walmart for partner small Niagen BXB million total our was Thank investor in our Tru a XXXX $XXX,XXX and business. be you quarter company. Extension. up and legal in expense. we U.S. long-term and with ChromaDex, June, excludes a with for which partner, joining afternoon, net yet significant call. Good another growth to in positive Group, we Niagen for quarter strong had sequentially, in Tru our $XX.X and thank And to Life sales XX% expect launch total Overall, ROW, mass ingredient including and H&H retail Health along of accomplishment

the as over XXXX. our of sales sequentially Prime million. well COVID strong up sales sales XX% E-commerce the this result easier benefited the in quarter last on As an of of $XX.X quarter second We from and impact a second as Amazon quarter year. I as the business Day comparison were were net to mentioned, total they company quarter XX% continued for grow

We EBITDA, Watsons million which approximately And Gross EBITDA to chain million sales quarter. disruption. down added to existing supply In new total, expense remains partners, of prior sales were sales quarter We as compared Watsons as including XXXX. Total three from to delivered Walmart quarter. of legal second to prepare the XX%. to second and last ROW the improvement the year. quarter, our profit in year-to-date expense we a temporary excluding I define higher following margins adjusted $X.X also but quarter’s $XXX,XXX, partners legal compared $X.X for mentioned, was a trials this was we as last high increased

try repeatedly to the As of and to regulatory protect our brands property on companies infringers, our will we continue I back build our said, have science intellectual against their accomplishments. who

XX additional recovery precursors time symptomatic nicotinamide reduced published nicotinamide clinical that July, Frank committed Speaking in position our knowledge science in remains riboside stronger. maintain the to that statistical COVID-XX We the our as increasing of market. in as XX in Advanced portfolio of were ChromaDex provide the X completed Researchers Therapeutics by behind study protocol, nearly patent and compared including in more and been our to science, clinical to updates XX%. the leadership ScandiBio journal, investments around the the Niagen on peer-reviewed as well showed significance ingredient, results has trials Science. to NAD Turkey rapidly of now trials XXXX other patients In nutritional will R&D growing with XX% this supplementation never a momentarily. science have placebo, riboside expanding Phase progress. in in

the core Tru work the to engine build excited are category. to Walmart with the X,XXX opportunity stores of consumers at the Niagen While about and supplements NAD business, to new we reach Walmart remains for direct-to-consumer

XXXX were selling initial new all Walmart product should in available be our this product Our on delivered to strong to for time SKUs to and on walmart.com. Both also priced, XXXX approximately milligram approximately available Walmart are product should quarter introductory dose XXX Sales locations with the launch, due locations. available lower in locations. lower be standard

Walmart launch. of and sharing call was shareholders, a never targeting thank build foundationally more to continue is cross-functional today. at Frank our forward that I strategic for pass a your on been this optimistic I to of to we the Jaksch the to slowly partners and growing It I brand. our accelerate at on the true have Overall, consumers. Chairman, our for campaign sales as information for as ChromaDex we aggressive Marketing upon milestone this should it’s future. would over Tru continue that team consumers, like will We rollout will great growth have scientific to this an And early new the In entire important is short-term, group in who believers and of effort am campaign. I a build our proud Head more of continued support. global our about our Niagen future Walmart delivering look working am the we as update I still now, in launch on research. ChromaDex expect

Frank Jaksch

In and health, quarter, Thank were neuro publications inflammation. several alcohol-induced preclinical including you, the Rob. on there bone or inflammation on nicotinamide second riboside, studies NR,

an ChromaDex article program. implications May. published damage, clinical new research vision in This systematic since treatment June, broad models on preclinical last affects with acute addition, both is retinal and precedes In the ganglion registered our Both kind was a which health in are studies studies Two that clinical of that first for glaucoma. of human external cell our NR’s part protective mouse often an also study health. population update demonstrating specifically research has area and its of chronic of

the the NR clinical Center treatment daily include sessions, on to metabolism, and in period, double-blinded, imposes which muscle Medical and bike supervised Participants in study participants First, XX treatment whether given high sessions compared with Netherlands explore mitochondrial will for a exercise interval a twice of and study greater XX-minute skeletal XXX exercise registered approximately exercise in X Exploratory XX older combined consists X X endurance over outcomes Maastricht a days. alone. of performance. including improvements intensity adults training physical muscle will metabolites, placebo-controlled sessions. energy randomized, NR engage milligrams NAD of University metabolism in be X-week to

We of sports studies NR whom Tru important adopters This have an combined seen research professional and of of given early our in examining is of product. their recently opportunity and registered the fitness Niagen are area exercise. for community, many more the effects

your the the Researchers ataxia focus in or In in movements. disease be entitled supplementation The NR system, of rare NAD study in addition registered other telangiectasia immune system to primary disease investigate dietary of this nervous Norway. was supplementation affects symptoms. will that of study neurological with to will body effects children progressive the clinical neurological AT, and on

support Cockayne syndrome, proud We and diseases Citron on to disease syndrome, important rare and Werner are like like of ALS. growing Friedreich’s list AT, orphan others research ataxia a

our addition, published were newly clinical last update. In two studies there since

days, XX% peer-reviewed group patients First NR study recovered of in nutritional with X.X June, nutritional community well with subscribers update whereas announced the on medical previously of shared receiving practitioners. The preprint statistically the clinical the X recovery protocol the less in of us in journal statistically showed in p the group the blog reduction the double-blinded, a placebo. X.X study, in to significant significant placebo days. We were in with Science. recovered randomized mild-to-moderate placebo-controlled published a Researchers healthcare Phase had our included protocol point a on The were through COVID-XX but that average results the as than time Advanced in Turkey X.XXX. results to aboutnad.com, receiving as the value post results compared group the in network

published metabolic College patients. kidney activators in of with function therapeutic and study patients this the an and in the preprint activators in improves moderate-to-severe COVID-XX including of Institute is server, study study suggesting metabolic NR, led Technology disease. medRxiv. of disease, in for a liver the This Alzheimer’s combine markers activator investigate same to improved combined In demonstrated Royal was supplementation function metabolic maybe effective the Adil cognitive first significantly Alzheimer’s supplementation London. used effects addition, strategy This combination by in and the study Alzheimer’s health Alzheimer’s was study of that entitled The the cognitive Mardinoglu from Dr. to King’s

needed to are findings to For we more validate and be study and a sharing for these build results waiting this, before studies peer-reviewed these are broadly. on initial

conference was raise I Status, community session. session as Advisory of scientific nutrition Optimizing had This on the Scientific importance Q&A human NR. awareness at large team our to Featuring event was XXX body data a our high members ASN. American health, of speakers presence research. Finally, Board, well an wanted or action opportunity the the of ChromaDex members. partners and for as of The for with the ASN by a attended NAD efficacy engagement session ingredient, well safety Society our on highlight internal proprietary participation NAD program during the extensive as external to call entitled virtual during our from by research ChromaDex ChromaDex’s Nutrition, as the hosted a to

supplement dietary a Our Scientific Dr. on and the American Andrew Regulatory panel previously by explored a Council Affairs, for Head a I discussed for also the Responsible the hosted and Shao database industry, of Nutrition. Institute of importance the Conference topic

remaining Nkrumah-Elie, External as we Yasmeen mouse research future entitled Partner the bodies nutrition to session world and we ChromaDex the Director Kevin is in continued deep that, NAD ChromaDex Furthermore, ChromaDex pipeline industry, relationship leader the testament thought scientific beyond. participated and I trials and believe what to models clinical call the Dr. growing that panel a shaping showing and in with in Research and Program in year be benefit the pass is NR a exciting a position forum, robust to the based preclinical Finally, for the up the well clinical XXXX ChromaDex’s community represents seeds a This recent around will the studies. on committed as who is completed to in ASN continue for Kevin? your I Farr. With growing do. of Sustaining regulatory leader maintains are, XXXX an industry. ongoing to and market. of the as publications

Kevin Farr

and prior our a total delivered the $X.X by believe $XX.X legal sequential with release P&L measured the ChromaDex profit EBITDA, included EBITDA sales XX% XX% net underlying versus breakeven We a and GAAP the the and XX%, flow of metric the Horizon a we non-GAAP $XXX,XXX, year. adjusted you, excluding sequentially. have as year last reviewing then Ventures purchased up sequentially measures an about million, Frank. of discuss our I trends. year-over-year, Thank begin business In $X.X strong expense, to slides. improvement we posted or million million will slightly excluding the adjusted up towards important metric quarter, appropriate legal in reconciliation results by to up excluding expense, year-over-year earnings will that a gauge remains progress cash and

$XX.X in million Niagen were of with sales June up million net XX% reported This to compared second growth a XX% net sales sequentially. by a For $X.X quarter. quarter, last driven shipment first compared quarter. the the shortfall Tru the catch-up this XX, million of following in X XXXX, quarter Watsons We the million months from first XXXX. $XX.X $X.X ChromaDex up ended benefited of in sales to was million, quarter $X

headwind year-over-year expect as return smaller Watsons believe for to to concerns recovers We the travel impact the this XXXX. compared the is the and economy a variant through quarter a to Delta have through from distancing over Chinese is store traffic traffic the tourism sales social baseline benefit in COVID-XX local to recent resident we of due Watsons, have pre-COVID third down that We and restrictions, in levels. remain measures, yet may and sell but improvements Kong COVID-XX, in some Hong still demand

Amazon XX% Day e-commerce business up was boost including this sales a quarter. Our from Prime sequentially,

in was at well a shipped initial to There at shelves successfully the we as stock quarter. shipment Finally, safety second old to the their XXXX as stores the the distribution large centers. stock Walmart

shipment Our our ingredient including quarter, new sales versus partner, up a extension small sales to Niagen were to ongoing the prior life and ROW. X%

the product by This our sales benefiting margins, had the in and points Walmart in in Watsons higher the and quarter, same we carried a savings to XX.X% includes XXX from gross partners. from second of second scale. among down quarter XXXX mix continue deliver initiatives to to sales the margin first lower on other our We was business business Our XXXX. which cost than of a chain are quarter time, sequentially of basis gross overall to At supply e-commerce. XX.X% and

better XXXX million, of tracking million Total $X.X we slightly gross goal operating As $XX.X a margins. result, of XX% was in $X.X in are quarter quarter our XXXX. well year first to first for the second marketing than expense million Selling full the were down of the to million down the to expenses to XXXX quarter compared of compared quarter XXXX. and of slightly $X.X second

As ChromaDex. a XXXX second business higher partners quarter due XXX was advertising in down XXXX with business net sales versus percentage of to expenditure minimal the of net quarter this sales, by points basis the first to to of

decline have a over I sales fluctuate As said, this previously may of campaigns. but generally as ratio as marketing time investments quarterly result will the ramp, our

million XXXX. second quarter XXXX of $X.X in expense million quarter down $X.X million the was first to in down expense in $X.X second G&A to As reported, $X.X million Legal compared was first XXXX. XXXX million of the quarter the of versus the of quarter to $X.X

quarter with to we As this predict expected, is trial It difficult to second going in second magnitude timing decline activity the cases of declined litigation the three of and saw corresponding year. potentially expense. legal pre-trial expenses half the a in and in

quarter expense trial budgets the of first higher that refined now total may quarter our XXXX. have than the We and expect legal third be

legal equity intellectual compensation expense. fees vigorously We excluding property, for will these restructuring our budgets severance to continue while to optimize look ways protecting and

XXXX first Second was G&A G&A expense higher versus million expense. quarter comparable quarter $X.X by XXXX

XX% of million operating of attributed quarter the XXXX. of For in quarter $X.X the With and combined second and of loss are share, XXXX, business including compared of Total in XX% for loss $X.XX $X.X a up million, versus Watsons and our growth business in $X.XX per first stockholders XXXX. the million Tru in net million growth year-over-year other a XX% compared XX% growth for Niagen a per to sales sales. or of of a share as quarter net to net of e-commerce quarter loss first the XXXX. XXXX or $X.X the quarter was common second loss loss $X.X was to The second

Our net XX% XX% year-over-year. sales other down were down were and Niagen net ingredient sales ingredient

this of and with selling are the sales COVID-XX of year XXX customers, an strategic compared the the our horizon second and sales a to other we expense We height with no XX.X% which to comping percentage H&H longer are last [indiscernible], In properties of short-term ventures without XX.X% Gross one pandemic. remains Selling replaced ROW. to during strong of to headwind of the the by decreased points Niagen ingredient second the increased compared as of new XXX to quarter boosting partners we ingredient margin XX.X% as marketing associated basis like quarter sales XXXX in immune net ingredients, second We benefit any the XXXX. basis XXXX. XX.X% points from in a investments. in marketing business quarter

higher was administrative million $X.X due million. expense primarily general to reported, $X.X expense As higher by legal of

across higher is more investments by savings Finally, our were by selling loss sales organization gross and margins increased in expense higher than cost the million year-over-year and marketing. operating and and $X.X legal offset

net balance ended our $X.X in million and to our our and raised use $X.X remained The cash and sheet to cash the the cash, timing the our We to prior company $XX committed In second balance employees This was a quarter million was $X.X accessed in quarter your Moving we from using million $X strengthens quarter first payout to operations primarily vendors, XXXX, sheet the XXXX. million of decrease to the related million payable line accounts the bonus this strong. flow, of due a ATM. of credit. our sheet $XX.X not have including of with in difference quarter cash versus our million, payments by of driven further performance. of balance a

today R&D as the release outlook, slide excluding EBITDA in metrics XX quarterly of leader half outlook, with will invest maintain the adjusted to details second XXXX, metric to in relates key for P&L more remains maybe marketing and full position previous essentially investments. it focus and XXXX, timing as year-to-date earnings growing achieving Consistent by we The similar As This on underlying measured total quarterly the a our volatility and businesses plus provided awareness, in breakeven in our there year and press the to on expect for the market. legal the along expense. basis of due customer we we presentation. organization, for to our a key performance XXXX acquisition our on but brand with

continue net our steady the consistent outlook. revenue year financial previous As to we to relates growth with sales, it full expect

to e-commerce be new Well, ROW, volatility from coming including we portion total net sales may the will second steady However, consistent are should our business that continue partners more expect third of slightly the to H&H, quarterly down ramped sequentially. to our sales from Walmart, A quarter flat quarter. cause growing which grow until they growth. the

We expect upon based this to is with full the year and and about XXXX Niagen row benefit Roman later the of growing from planned their And in quarter remain H&H for we respective to fourth products Swiss XXXX bullish launches sales Tru outlook. year.

balancing R&D rate growth to my expected a worked market rate reported will long-term strategic profitability with much very is I accelerate second quarter, XX% have objectives. pipeline company the team We internal is with including near-term and quarter. quarter year-over-year I year-over-year the further And during how that and business our time the in development, continues accelerate ChromaDex. at strongest execute, the the I in of believe am third our it from opportunity more will summary, fourth robust. growth proud In

now questions. take transformed years our about have and over company are We remain optimistic we ready last successfully Operator, I the future. to very the X

Operator

Oppenheimer. Thank you. first from Nagel Your Instructions] [Operator Brian with comes question

is now line open. are You

Brian Nagel

quarter. Nice afternoon. good Hi,

Rob Fried

Hi, Brian.

Brian Nagel

Hong are to, couple of that market. Kong I first you the you’ve think COVID crisis guess I I think, questions. with sales, to mentioned regard Kevin, primarily referring A to

few very it’s obviously So the at or your maybe, sales? impact you versus months of Niagen but to seeing generally are type this we more starting any reopening ago. reaction Are see point, question is in obviously a Tru fluid

Kevin Farr

COVID? to reaction A

Brian Nagel

Well, to started from is consumers’ some seeing underlying if open, indication I there you’re that improving trends? guess a perspective, the economy demand

Kevin Farr

open into traffic down. retraction. a Mainland later, few been And Hong we know COVID and There still up. Yes, is And has months China that’s and Kong times yet to always a then of a that returns. when the tourism reopening up portion see stores picks we Watsons it’s and we been from One see significant up foot traffic. been thing have

by So that. we’re impacted

last know Hong foot also of base core a Niagen We in few traffic has, But in that overall Kong. there’s Tru customer the especially Kong in Hong months the very declined. loyal

Brian Nagel

the Okay, got question, I one second marketing. it. Then this have on

was a it comment. think I

think Kevin about a spend. like you you’re sounded about financial outlook made telegraphing preventive to marketing It’s me higher I comment spin.

more the of is just you’re question there campaign, that I this am more there fresher hearing – the looking will be be of newer that that So importantly, some some is campaign – correctly, of is type or then type same at? but

Frank Jaksch

previously, remarks, You we I building a have than Rob. spending we it’s in it’s be. supporting would some it’s and I want don’t said we – Kevin what the little we’re now small up. to going we’re bit indicate going on be a say we’ve or And quarter, comment to prepared Walmart. would be a for huge. to more brand not where said saying But slightly Last larger you it we’re increase. do know,

Rob Fried

In of general plans Brian? marketing in terms

Brian Nagel

sounds Yes, that great.

Rob Fried

Okay, brought a in Walmart. just know, we the you ago, CMO well, months recently And we at new on X launched company. just also as

we customer understand And is customer that slightly formulating customer. e-commerce is brand marketing. plans We who an have now. the our so based basically expect overall existing our increase those we Walmart different we to indicated are And that than awareness

a that the traditional So bit a even channels the certain going and to are extent, towards advertising shift the to type television. media means advertising messaging the of like distribution,

that. advertising So an going increase begun to in expectation yet months. our based in it’s we coming that the you’re see But haven’t TV

Brian Nagel

Got you. it. Thank

Frank Jaksch

we And Kong, of effect Hong as I improvements on COVID-XX. seen for the and through question Your versus and half the up shippings sell of Kong economy think first half recent have recovers some of first Hong XXXX. XXXX, the

consumer underlying remains demand strong. believe Watsons in we Although

pandemic. through campaigns normal traffic As down this see sell is store marketing is to Watsons the return in new Rob trends investing the year and post year-over-year, expect said to we

Brian Nagel

Thank very Perfect. much you again.

Frank Jaksch

Sure.

Operator

of Cohen comes Ladenburg. question Jeffrey Your from next

open. line is Your

Jeffrey Cohen

are Hi, Rob, you? How Frank Kevin. and

Rob Fried

Great.

Jeffrey Cohen

here. got to have around few, a sorry bounce I So,

then addition far. So, sounded and correct are you milligrams Do [indiscernible]? Walmarts another That’s the getting $XX XXX X,XXX getting like so are like X,XXX milligrams. XXX anything it have

Rob Fried

the other around. XXX XXX let first It’s way with with me say, milligrams and the smaller milligrams. larger the So numbers numbers it’s

Jeffrey Cohen

how Okay. centers, approximately? many And distribution

Frank Jaksch

XX got have centers. distribution They

and are So they product doing is we basically in and are that that’s less the to have them more to and then June the centers the them what planograms continues shipped July June August. on shipping into we distribution are to or planograms setting in stores

Jeffrey Cohen

are Okay, the that of most far SKUs? so way two as the through you as hitting with the challenge

Frank Jaksch

Yes.

XXX% takeaway, will will is quarter with We and it fourth for quarter build for weeks have And be time they And but do stores, X,XXX quarter where of in shelf. that expectation the to more to X are gate, X not and And about it’s our the for third weeks, supply our certain more centers, to few is marketing. out expect regard tough in X,XXX continue it’s should stand on be we next but the replenish. can all comps in set it shipping based also put basically tell we to then to second their the in over so have for they because against third upon but the which the stores. orders are quarter, expectations have we consumer early a we as we distribution XX we then low POS, what

Jeffrey Cohen

revenues QX pointed imagine pull-through spend haul. $X.X the you less your in order the there. the nice some over second like more Okay, did out, in But you Watsons with is there your while sequentially you got down million it. in meaning got went Kevin, sequentially. looked have big then some long as up I it quarter And

back about quarter? half the talked to from flat QX that’s it part further in out XX.X and guess sequential We play of QX as the on So anything down second I your of commentary. year may

Kevin Farr

Yes.

I my growth that in third to we remarks greater is prepared the we the be thing quarter. year-over-year think said than the expect

quarter growth is second XX%. The

the accelerating. So, higher third XX% and quarter to we in expect be than quarter the fourth that

Jeffrey Cohen

it. Got

can about repeat later And something you said Okay, about XX%. heard you [indiscernible] what this I year? channel

Frank Jaksch

actually development primary Yes, And with are and shipment their a we products. think that We And of to small don’t to are ingredient. expect mixing the selling either a their we sell them shipment of it in bring they product their with ingredient the quarter our business of ROW the intent second to in fourth the I in that’s ship to and quarter with because are quarter. opportunity to it in process they the market. some manufacturing ROW, the H&H, third saw is

Jeffrey Cohen

Perfect.

if that’s Okay, for for Thanks taking me. questions.

Frank Jaksch

welcome. are You

Operator

question next from Wainwright. H.C. Your Raghuram Selvaraju with comes

Your line is open.

Raghuram Selvaraju

very a on for and congrats very taking quarter. questions thanks Hi, my much solid

you was there potential yet some presence stores, the I to U.S. not the announcement, all looks has Firstly, if it on where wondering June Walmart like on could comment expansion of probably Walmart are based of store because stores the occurred. still placement Walmart product

timing of footprint kind be, to wide? the that, of might full update an Walmart when on it store potential get wanted Just

Rob Fried

we shipped shelves their most successfully the know We’re at placed many only placed have actually We have in to exactly stores the the of product how the point. of and of We receive stores. received just this that the X,XXX this centers know at have to majority stores from stores yet the centers point. distribution vast don’t on from begun the distribution We them have and the reports shelves. the on

do have see additional we than the So which not we others, conversations going are better which not yet remaining into stores performing to Walmart know, until expanding about stores. with how we are

Raghuram Selvaraju

Niagen in Walmart excluding think Tru the right? I eventually The in to placed arrangement original there’s over was stores U.S. In Niagen to store, X,XXX from there’s say about it suffice bringing be principle, Walmart nothing every in for Tru But X,XXX them. of

Rob Fried

stores, to suggested going X,XXX was idea even initial The correct. is X,XXX, That then further they going they further. then suggested

there our all of arrangement going Walmart is that preclude So into would in the Walmart with stores. nothing

Frank Jaksch

if opportunity XX milligram you stores. count, X,XXX we is expand at good least to expect would I get the they’ve X,XXX XXX that selected the behind And the first think that velocity to from stores

hopefully then probably of up So, third launch XXX their part product. move of XXX milligrams this the again, having I strategy and customers me sample the think to milligram

Raghuram Selvaraju

with then And to that additional incorporate you can specific some Tru specific And arrangement, or with what market might Roman likely it. us to on provide are Niagen? targeting? the background row Got product line the just respect segments those be product

Rob Fried

it’s them of with to At fourth a combining a that product. it’s And are name, but They one released well they life the I it other name is only a ingredient ingredients, extension a in they expect this Niagen the sort they yet the is – couple have to Niagen. there there. point, haven’t obviously, but quarter. going release, hero Tru they’re product launch of the product

any had yet haven’t any we product subsequent have products. them But that with to would obviously, approve. propose, they would additional discussions about We

Raghuram Selvaraju

there how many And are right Okay. Roman products now?

Rob Fried

don’t they know. a don’t they is division. division. division, female male obviously, products and only and this the business is their – how many the for their also printed of – This just is initially have male know that have, targeting I core I division a Roman

Raghuram Selvaraju

Got it. if you positioned the be And of is whether speaking, Australia a Swiss the is you than driver because lineup, then confirm likely through with primarily favorable to collaboration, where H&H broader this expect substantial ranking reasonably be most Swiss lineup I context going demand within regional the the to the respect can from to product product Australia, enjoys standpoint? of if or the positioning think most which demand, pull market is

Rob Fried

business. bigger cross two to to going their clearly But China they’re they if than their into business border markets those We are top pursue. that the don’t Australia expect know be

Frank Jaksch

supplements the leading in And on brands they China, are border. cross in

Raghuram Selvaraju

to second the with to initiatives additional the revenue this of notable your year? Any you overall mix e-commerce expect over course contribution take the that to respect increasing root half of Okay.

Rob Fried

and steady view loyal online e-commerce we continue we base growing very is that website. to purchases are either consistent very, or on to way large our and growth. a is an consumer And that There extremely Retention The very Amazon rates expect grow. strong. on

You steady, growth. last have the over seen years consistent X

an have we continue. which think a that our a that that campaign, Not be But as We has on expect a it. I anticipate also that only impact will for we helpful think also to sales we as do component ecommerce major the Walmart brand will launch well. television that sales, as of

Raghuram Selvaraju

Great. much. Thank you very

Rob Fried

Sure.

Operator

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

open. is line Your

Jeff Van Sinderen

questions. afternoon, the taking Good science now spoke and R&D. more around Niagen Multiple for everyone. Tru about Yes. I you know on to in you plan first, development questions, Thanks my spend

maybe on that where dollars – about think am you to now, So, just on what what you to R&D maybe of are of the potential the wondering couple is the a the touched just I business? I dollars which where studies a those. for impact us to to makes right going, then, spend leading better invest R&D it you maybe guess, can you the want guess where sense more or And underway R&D I gives pick are sense

Rob Fried

up NMN include global that specifically for studies, that phosphorylated, opens Of as mechanism superior not burgeoning a of the riboside entering have is the R&D, of of we people intend Both know pretty pathway nicotinamide clear is has and them are to under for There build commercialize most well for development any clean mechanism into a course, as they only call a that cell IV growing what a molecules. this those related also and to that both around ChromaDex the which are products. range and nucleotides, are and looking are Whereas is some familiar of is develop with investments the products. market meaning on of – there course, new wide but market. entering we they just that are strong nicotinamide of various are have when who NAD actually very that stress, which of And significantly have meaning there NAD nicotinamide proven There riboside. we is riboside science some cell, a is cell. intellectual is which don’t are molecules property it

from riboside up their terms molecules nicotinamide of stand the So neither cell improve NAD. those scientific ability of health a the elevate in standpoint, and of to to

thesis, that of the part sort invest further already of is in So, idea, to fairly scientific studies support can that we which the investment but further. just literature, support in is proven that

of out the got studies nicotinamide investment additional of as for in of we addition, published part – But the well the there doing molecules, superiority blinded the molecules, as of riboside and comparison others, but our for outright, the support are some in studies. published other you study the others the published the molecule Jaksch ingredients. cocktail was fairly they some host COVID COVID. to have riboside you We Frank these recently. the that as of are whole ongoing, recently ability Tru certain We understanding But may well of make grows. have to extend is been reviewed, certain extends positive and of clinical nicotinamide results, development double additional those And as studies, as nicotinamide mentioned soon hauler claims. know, bioequivalence our came So, on pay of investments proof riboside, them several But study to further there the placebo to as to some contribute our of studies health molecule, we recently additional Niagen or of may be recent, claims. as make on many you some But know, of that that of pretty as a won’t yielding studies. understanding health just Harvard consistent peer long not of

portfolios to further But point that have that against beyond some protecting Our investments would patent ones patent also those further. deep even out I very which we and in have portfolio well making will of a are the studies we even that strong increase. extends we infringers. investment even the extending for and been like for

to ladder So, studies are not R&D. per all of up They those se. investments just

Jeff Van Sinderen

that that there you you is study mentioned in study COVID. to Is the And as then that. that’s recently of there different there have you there it? able unleash claims until of may new up been anything make lots is that make will new Anything than markets. claims that’s to now? of or But Turkey in been And different terms done a for brewing subject around is allow Okay. this know, sort will I to, then allow of to anything follow-up kind claims just you

Rob Fried

whom studies enable liver health anticipating you health, related and range is regulatory published are some time there portfolio a claims XX%. health, But may Yes, that recovery studies listed being cocktail, hypersensitive that COVID, are cognition. could COVID. states some on at are shows there as there on reduced not clinicaltrials.gov, whole extension peer There in authorities some extend to heart yield or Even our of of are with done it’s The know. difficult us and that on are a some by and COVID reviewed inflammation regard we though very of to looked are necessarily this studies on the that studies. are claim we to making our muscle are study claim There general. about to have portfolio. But issue, non-drugs to disease

So, for but COVID. it’s a a dietary the specifically and consumers disease communicate especially challenge of to efficacy to supplement state, a

Jeff Van Sinderen

on that’s Okay, And helpful. just to then new partnership anything with add Nestlé? the

Rob Fried

companies And fact riboside. space. some have add, there that that nicotinamide confirm further nicotinamide a riboside, to of value deep can recently has of is They understanding other in new dietary in acquired the than nothing a the I supplement Nestlé interest the deep

the and of was strong as very how a with I know there understand nicotinamide well. they more positive today Nestlé them riboside but value it’s evolve, couple of companies. Health working So, portfolio higher the Science much of don’t are are a years And it and is than ago. in even And they there. will throughout we relationship a it priority interested

Jeff Van Sinderen

one you or I know could status three this to is that big I point go you cases but guess at is great. know litigation topic, Okay, I the And much quo? developments last quarter – said half. trial and on I Anything squeeze in to could versus the due have second new more, any this if a pretty

Rob Fried

it’s quiet of trials. in the right now, I really, mean Not anticipation fairly

both homework ready. waiting to trial and think and begin. are And have done their companies the we are just prepped I for

Jeff Van Sinderen

Okay. questions. taking luck. Thanks for best And my of

Rob Fried

Sure. Thanks.

As always,

Operator

from Sturdivant. Your question comes next Mitch Pinheiro with

is open. line Your

Mitch Pinheiro

a believe of questions I couple just augment here.

new the First, curious part recurring this revenue, growth? of the the e-commerce Did the to group, customer of it was asked, evenly quarter other? growth drive with versus I split but more on always one just growth regard than

Rob Fried

a pleasure? wrong? Well, you I asked retention having quarter. did at have is new see in this past I I Am as strong here growth question But company. the some We think before, always, very acceleration that am customer

to two seeing retain the to in mean, attention We it notice have we yes, who those But rates they people or low customer months for begin I their cancellation they improvement to in new take months it. of three that fairly are begin take Certainly started physical if acquisition. pay seem improvements to performance.

Mitch Pinheiro

pick an some not or the a but would they through to e-commerce? wash it would that allow at that there have Watson’s and Related Tru customers fair would to bottleneck to were If your something of people through traffic, there to to have we going do Niagen. that, they gating Is there wouldn’t online recurring or the store Watson’s? I factor am have taking revenue a of I up? issue I order out I would recurring it Niagen, online. Why slower Tru go why Why you amount been store become – store,

Rob Fried

attract is to a an Niagen question. is think stores. been Watson’s of And strategy important to business. use part that has to that But people good the I No, Tru that subscription think I

draw not continues much Kong be are in stores, are it think they So, they as get as case. Hong people very them in stores. online it selling the to that the in because into I has for a the And interested selling to been

Mitch Pinheiro

question around people to would chance impactful recent a get it. that Another I that the Alzheimer’s those study relatively the some and is think that most read studies, were meaningful conclusions disease, there, to

seems rather formulate of by are aspect don’t the on disease be in able in you like so of can’t I it seem can but make the you usefulness are to better more particular something, you so looking others. your to more Are not Alzheimer’s should studies disease studies, they more a effectively more. designing use that study messaging? science them you a itself, that at but as seemed looking is something you bigger, think have than to And and to studies that impact claims it It seem that, to you me where have, these

Rob Fried

their comes work finance perhaps to been have $XXX any call of able there from a life there researchers we CERP study And we that their we can not we research program. is that ingredient, program program, design supply influence get a But it, putting us study. worth is, if to is property it, million, the the it. it’s as to that study, this Where but the the that the then to have we maybe we ChromaDex. part program, design can’t remember, with but million it’s without $XX licensed intellectual So money. and with we we that of downside back up And company do

not studies some claims But it’s that are our is are future design that not to think that financing, opportunistic. the it studies conceivable we in might areas lead we call. for mostly or that we So, specifically

are is For think of a riboside. that particularly we certain area consistent of that indicating important think inflammation reduction studies example, interesting inflammation level show markers. seeing We we fairly a a nicotinamide results

or expected us outcome studies designing our that might that marketing knowing audience. we strengthen very, enable would it With target there are when are things there improved we you, why complications obvious area specifically relevant NAD. cognition around of know we we see likely cognition to obviously, to is very breaks we barrier, think So, blood understand specific mechanistically many But NAD disease reduction or you heart think that when elevates related product. that brain important improve shown neurological just is a the levels, Alzheimer’s, that we are and to think other conditions not functionl, think Alzheimer’s, inflammation, have the but for diseases, a We this general, are many we can you mitochondrial functionality, disease. regard elevate in diseases, states, that that elevate marketing and a a that you claims agree with autoimmune it

think research But before – yield see we the we specific us do Frank shot explain get and too? you are to about take we get are expand question, off you Jaksch, chance and specific at result that like me if we yes, would will for pursuing that studies to dollars – perhaps let that So claims. enable our applying a I that a question, opportunistic

Frank Jaksch

for awareness positive in done I case, And Mitochondrial people right, function I I studies mean, underway, with the it such and answering the on Alzheimer’s does things job studies impairment that you improving around we go you of in their it this than of are which out need good mechanisms. sense are just primary Alzheimer’s. studies a type do in this that seems rather have to other the go like to in you it But, as clinicaltrials.gov, good at look already. at that find study. you In to Alzheimer’s. around at importance least mean, in Well, layer that these Alzheimer’s can one from like Rob or along yes, cognitive utilize to enrolling mean and is was And whether use something are to of had But make the a root there. would mean, a Alzheimer’s said. cognition, in be the reality, those mild after we study, you to to outcome, primary if mitochondrial role to to cognitive function. will focus out we Alzheimer’s looking the then support really lines the are central build there more I claim claim have order in as look a impairment play progression mild

Mitch Pinheiro

strong to the is one going that Obviously, believer or like e-commerce this be needs steady the to minus. all of going TV, it’s, digital XX% going you – them, is business, build your spokesperson, in it spokesperson? be a cocktail be an going a to in have it of on which the are am perhaps really more there of rate is or type it’s too unlock that just but have true is Thanks. curious marketing, plus the is does credible break. acceleration a question one you form probably view one of better come to a or is it’s accelerate I I of to growth, do in growth to And looking if growth? it your that real

Rob Fried

and know, going he and and Well, plan, his of about he we his strategy very is in a is head he way marketing as methodical is new have it. you formulating the

more but work anticipate by TV. that more to guess, in the that have you is my as sales, we awareness. seeing increase I as TV, done based So, e-commerce on see being are is well will Walmart just going increasing that And seen sales,

is Tru the high. overall Although strong, awareness are are we not that excellent, rates think retention Niagen the conversion the rates still of and

But that opportunity people and frankly, So, think is yet. we globally. it in don’t many terrific the about the know U.S., just here

Mitch Pinheiro

Right.

Rob Fried

second the is the expect perhaps that the that say – in you said TV months can coming we And did that..? half, you is

Mitch Pinheiro

Yes, second half…?

Rob Fried

expectation. That would be my

Mitch Pinheiro

Okay. Thank you for your time.

Rob Fried

you. Thank

Operator

from comes Farmhouse Mark question last with Equity. Your JP

is line open. Your

JP Mark

taking Hi. congratulations call great also kind my and of Thanks for on quarter.

asked and been do a to about only going? little something but that and talked the or which you answered. so tangentially And is questions on most pro-market, my is about see do that’s on the whether opportunity, great wondered I have any ask bit I there a where call, want last you think if update

Rob Fried

for very Kevin’s topics, we the If one because these we that have Niagen Tru studies that significant favorite of and fantastic coming are opportunity. think no this pro-market out. growth Yes, is much other is reason a

the consumers. healthcare to of marketing rules rules different supplement. but general to pre-clinical, some are practitioners Some address clinical them we are are that dietary the of But But around disease them are around than states. a marketing

Niagen practitioners, more them on So, is know specifically. healthcare and great to the letting there flexibility nicotinamide research riboside marketing in and about

practitioners sell we healthcare what Pro. Tru to is So, Niagen

yes, So growth for as us. that do see a opportunity I

JP Mark

your that never channel? for the on you milligram to that site And going own just be XXX milligram it’s better actually have formula would always XXX than

Rob Fried

say I never. not would No,

JP Mark

Okay.

Rob Fried

However, it between is two. the important distinguish to

JP Mark

it. Got

congratulations. much. Thank Again you very Okay.

Rob Fried

Thank you.

Frank Jaksch

you. Thank

Operator

Q&A for This remarks. Brianna turn session. Gerber the concludes to closing the will now call I back

Brianna Gerber

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

Operator

conference This call. today’s concludes

You may now disconnect.

ChromaDex (CDXC) 4 Aug 212021 Q2 Earnings call transcript