SNES - Earnings call transcript Q2 2024

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good afternoon, and welcome to the SenesTech Reports Second Quarter Fiscal Year 2024 Results. [Operator Instructions] Please note this event is being recorded.

I would now like to turn the conference over to Mr. Robert Blum, Lytham Partners. Please go ahead.

Robert Blum

right. All XXXX. Rachel, SenesTech's all results second period June much, today joining for thank ending discuss to quarter XX, and so for you us the Thanks XXXX financial

Mr. With Joel Officer; us Tom company's the Financial Chesterman, call on today Mr. Fruendt, company's Chief the the Executive Officer. Chief are

prepared we [Operator Instructions] open conclusion call the the At remarks, for of today's will a session. question-and-answer

safe SenesTech the during remarks, of Act meaning provisions following with course statements Securities Before Private Reform prepared we management submit amended, Securities team the the forward-looking such the we of Securities conference Act of and Act Statements Litigation of XXXX statement. the the Section and of this record XXE made of the harbor made of of as contain call by begin amended are forward-looking for Section the may as XXXX XXA statements XXXX. the within Exchange to pursuant

are plans, or risks Forward-looking statements by events forward-looking forward-looking as circumstances, uncertainties projected projected should, a differ in statements may will Exchange to of statements and projected. expectations, risks filings draft, identified from that Commission. results as our future Securities expected, the in and planned, cause a words materially could result statements, factors Listeners describe those results or differ the actual the with those strategies future anticipates, results other to and that including materially in the of eventually various from multitude generally future, or are such cautioned such that risks or preceded may, plan are and subject or

obligation events otherwise. this of on date. publicly of which were of update result occurrence forward-looking and as management's during whether made the does any contained and statements, any to such or call conference statements new as in information, future based a speak they company undertake of receipt the as assumptions the estimates not are of The date forward-looking only All

that Chief call the SenesTech. to over Fruendt, proceed. let With said, for Joel Officer, please Executive me turn Joel,

Joel Fruendt

I'm the and you are good over market, XXX as stores to sell the Robert, product from where with to over speaking Ace afternoon, buyers all Evolve stores. representing from Thank well participants, the X,XXX of to you, line exhibiting everyone. over Ace's wholesale as X,XXX Hardware fall XXX we buying over floor non-Ace business

far, the initial exceeding dramatic, buyers from been has expectations. So response our

am they reactions demand lot my include comments for a the of are as is have earth-friendly customers. we Some this for alternatives have of received a to now that perfect so I happy and I poisons. more such alternatives, alternative

forward look results. you get in I to making with Ace. let's the sharing the more future are we But with on calls progress to

record numerous Second XXXX reduce across our as cash period quarter highlighted burn of well line as sales the with quarter which top helped as yet results versus in year-to-date look metrics, our objective key same near-term profitability. another to growth achieve improvements operational strong have XX% of we to

will financial moment. touch on progress a more in Tom the

our Let accomplishments means near progress the that my what me and for focus future. on and discussion

of is am side. XX beginning development from federal sale states. the as that to pleased Evolve by year. otherwise the fragility of now product, I at birth designated the for revolutionary Evolve, minimum a risk subject We product the product report launched for in state approved the formulated to EPA rat exempt control on regulations. First, still control a is as registration Evolve requirements that rat control known pass

a XX% results of than one reduction initial product international size trial study in of and efficacy This were University, litter XX% jurisdictions. over an and the required expected, of the just better and the we completed XX reduction an an efficacy the The after demonstrating was Arizona The some sustainability in of months. quarter, past Evolve. breeding by course showing round states

Remember, just X in become X XX,XXX rats year. mice or can

this population. in reduction a represents substantial So

conducting customers third-party including Also housing our for on to California trial specifically DPR alternatives are trial Evolve the area a early university we on of a the product but field and Some funded development sugarcane using in trials, same a in study large now mice. side, launched ingredient, fields, rodenticide Mouse, sustainable a the a use. product Florida active

is states. in It XX currently sale available for

a will rat the our market. effectively doubles trial, require be which Arizona some University. with As at shortly efficacy obtainable states Having an an mouse-specific underway product, product

Moving shelf The shift cost life, in have selling not through lower larger pivoted and line use our substantial ease that target a model, orders a costs. selling to we from product and we product commercialization, up. ContraPest of way Evolve to lower of installed where a development efforts a the distribution allows could

to is Evolve are continuing the international expand the line. market, only also We with into which product possible

with progress through which success these third Starting Let on our in areas, in the me front. and international walk you quarter. will the second build our

with four countries. in or exclusivity. active And agencies in international our distribution and for on pivotal order in require are you, full To to actually our XX remind with We working upfront market. have them, annual to purchase in are distributors of agreements extensively government countries trials maintain increasing we agreements, registration gain sales either an we those the

very increasing, is are stocking onboarding more. four discussions companies ag as is one national distributors this agribusiness, pursuing, both Moving currently area direct operations agricultural largest of are we which the interest have from as two markets in with large distributors. and through ag well We now to

to larger additional into producer, a sell to deployment has now An continue directly customers, its expanded would be almond growth. especially agricultural this in who California. We example large of

rapidly discuss Next direct on distributors. from management. to management vertical pest a focused is as reliance sales changing This is we pest to pivot

onboarding, with live distributors fourth. are multi-location We national X of the three top and a are

expand and distribution and works This We rapidly quarter. direct a as scale to industry's have are requires we the top distributors expect to extensively our them sales pursuing onboard four market more model coverage. this team with

we to is takes the to a big-box on online show, we much agreements an co-op is have reps with mind and selling box tackle also and now. of for tackle and in Currently, XX chains the our speaking big while the This We the Retail XX,XXX including marketplace We this include field is This I'm own largest from. Transitioning XX area over retail area market as accounts agencies and with website, the cycles. that the penetrate to representing -- buying sales largest five long have need who's are have very on buyers discussion alone. Amazon, now we here next we These also right the experts. the one on my retailers, over warehouses locations. an is decision live currently and now e-commerce. buying operators, planet.

addressed above have platform on are their e-commerce decisions We their own the of diypestcontrol.com. also stocking and also retailers separately. make Many

these So sell the same rep e-commerce industrial and selling to third-party agency platforms. also to retail

this past this to the of including quarter walmart.com largest into have agreements will two turn and have We and quarter more. and onboard next. revenue of six quarter, targeted tractorsupply.com efforts the These

most product by of our XXXX, summarize, the in could to we accelerating new retailers launch nation's are positioned place have transition online agreements, of two ramp-ups retailers launch solution, of for put of of the adoption packing we with engaged. to largest ideally Evolve Placement distribution one potential key the first whom perhaps bought to of To in half to rats recently our Evolve some options and recently will new these Mouse immediate brick-and-mortar result profitability. secured or importantly, with the by be see the growth the initiatives throughout retailers including due we

Let me turn a over it the numbers. Tom now for to discussion Tom? of

Thomas Chesterman

is first months later XX-Q hit our year-to-date. me filing the the $XXX,XXX the XXXX the year were grew driven at be line, sales. of the was XX% for to the today, for same beginning We'll which by and Joel. This was XX% in compared for XXXX. XX% already but the highlights. you, period total Evolve of of product Revenues launched financial Thank and let $XXX,XXX quarter Revenues X growth

website XX% with distributor over and of represented e-commerce and sales The our channel own sales. Amazon both

the margin month-over-month cost-efficient ever-increasing we Evolve. channel as we growth Cost been these growth of retail improving mentioned, Joel gross have goods quarters. the fuel since more will for the and launched As two channels well next anticipate sales steadily sold as of

XX% up margin the Gross was XX%, this year. same last for period from for quarter

at represented high In margin record June gross a SenesTech XX%. for fact,

higher As the past, in opportunity out. this we for and Evolve proving and is said margin SenesTech, our it cost product represents a lower line

Ever-improving manufacturing operations margin give us both pricing and flexibility.

production increasing capacity to also meet are We demand. future

We to demand, meet have Joel the all current discussed. has of enough capacity demand including the

or costs. will up more and clear final our are a with larger future facility demand headquarters year. our negotiations facility meet of at allow of increasing that increasing Anticipating leases to our next manufacturing at in the without newer, dramatically the X we that demand, the meeting facility are our us end years a view of for and However,

continue well. hold OpEx on the to We line as

operating and fact, In cut with disciplined our cash expenses, profit burn in revenues, half. we growing solid gross have

adjusted Our month. more measure how million was historically or a cash than EBITDA $X burn, we

The $XXX,XXX first EBITDA year, of half adjusted month. the was a our about

far, the the adding early cash I breakeven we near-term the mentioned, Joel next even potential in in we're year store box sizes order and Ace in the potential potential retailers with growth the given discussions. so flow as these see say trends, far and go at to of for would With whom the the reaction warehouse of definitely year. potential so big the e-commerce

This put the in allows ATM opportunistically does not or to place times is sell not of markets over do small that equity capital raising have of way one On at stock us to lower market. capital the This time that involve a at-the-market warrants. facility. cost and side, amounts an the market directly we disrupt

negotiating we finance at material allow purchases raw addition, rates. us will In facility are to credit inventory favorable currently that

has already more. capacity detailed this in using have of our as investment year begun our be manufacturing XX-Q. Most will using debt We debt been

be much year first the has great, half better, the of of While promises to second even the the been year half better.

the open let's line questions, please. Rachel, for

Operator

the begin now question-and-answer Instructions] session. [Operator We'll

Robert Blum

this Rachel, here. right. Robert is All

offline the go While the and we a any to here via questions wanted line, couple if have I to come in post of questions to traditional see it wait teleconference ahead company. that we

any for is, The comment and Joel orders? here you on first city one large Tom recent could

Joel Fruendt

for and our take we shortly work one. proposal. Newark, Yes, In one then a that Boston New We expect on municipalities. Evolve large an request And And have some furthermore, their done of they certainly, from over. area order ContraPest, received a Hartford, they Connecticut. of distributors for recently just group switched some for large they a order past, successfully from had the order deployed Jersey I'll placed of on had that the

cities. we see can the big the heading So with trend

Robert Blum

right. Great. All

here question you elaborate can advances is, in packaging? on Next your

Joel Fruendt

Yes.

as pouches X-pound Evolve We're offer Mouse and also to for as in X-pound and to in offer and transition more we trying So pouches to X-pound pails, as well and currently, X.X-pound opposed we pouches. Evolve X.X-pound rats the pails. XX-pound

launching here operational packaging of we're economy offers our Asia, So an in overall sustainability part for and size convenient X-pound each goals. represents an pouch It XX% and product. a size plastic at the larger reduction as

Robert Blum

All Instructions] orders is, to you right. Great. That's helpful. that profitability? mentioned Next on can you one take here elaborate that or you two could big [Operator question

Joel Fruendt

give Let you me of just that. an example

So thinking about stores. warehouse

just million and that could ordering pail I'll numbers, about use for product campaign. our say pound. revenue XXX is stores be store, X delivered as So $X $XX,XXX round per booked a per XXXX which That's

very substantial. So

example, stores $XXX box million. of X rate case, big per those case roughly month, annual Another you $X a order another an retailers, that take if that's over say per XXX

those customers. we And pitching such I multi-location over customers, as XX,XXX represents are locations. mentioned So of to earlier, the total XX potential

So very substantial.

Robert Blum

That's, very retailers moment you we helpful. is have right. here announced? I why again, results the think, other see have for don't these Great. question and deals from Last All I

Joel Fruendt

all we immediately. certainly, to would Well, see like results

longer. bit of and their have they buyers, Each little patterns. a takes it processes buying own these specific Sometimes

So they it that Ace, the wanted. that advance. us least for system, and wanted the everything example, complex agreed purchasing in process, took they everything, to their we months it, plan to X a Costco, was on get put and at but hand, other in way months

XXXX. next and in later spring we sales into pitching So on them are for

expand of amount little them start with a They and stock then of Walmart, their stores, with a base different. some on demand. product small bit their

They customer in their placement of in buy buying different, agencies. they when have work is stores. So pursue how their to to why is and we know with them know when to and is we every rep be their they have which these it so front patterns, product, important every products manufacturers

Robert Blum

am Great. questions showing I Okay. at further any here not moment. this

back it any remarks. turn over closing Joel, So you for I'll to

Joel Fruendt

Thanks, Robert.

Just the excited progress made. we've to about conclude, very

these going the a different is we're really channels hold really hit point we to over think, starting to good I out work just months X report this we've balance talked the to of news the the going about, past lot into taking where have that start across and done of more should we year.

for your you thank time. So

SenesTech (SNES) 8 Aug 242024 Q2 Earnings call transcript