July 2023 Sales
Increased 126% as New Initiatives Take Hold
Expanded Product Offerings Expected to Drive
Future Growth
PHOENIX, Aug. 10,
2023 /PRNewswire/ -- SenesTech, Inc. (NASDAQ: SNES,
"SenesTech" or the "Company"), (www.senestech.com) the rodent
fertility control experts and inventors of the only EPA-registered
contraceptive for male and female rats, ContraPest®,
today announced financial results for the second quarter of 2023
for the period ended June 30,
2023.
"We successfully executed against a number of key strategic
imperatives to drive long-term growth in ContraPest, resulting in
continued growth in revenues during the second quarter," commented
Joel Fruendt, SenesTech's President
and Chief Executive Officer. "Growth has since accelerated into the
third quarter, with July 2023 sales
growing 126% compared to the year ago period, as the initiatives we
have undertaken to drive sales, improve our product quality, and
expand product options have shown success."
Sales growth during the second quarter was led by significant
increases in the government vertical driven by deployments in
California and New England, as
well as continued traction within zoos and animal sanctuaries. In
the agribusiness vertical, the Company initiated shipments to major
companies in grain and poultry as rodent population control becomes
an increasingly important focus for pest management professionals
where the risk of exposure to rodenticides is critical.
The Company continues to innovate its product offerings to
provide customers with choices that fit their demands. In
July 2023, the Isolate Bait System
was launched as a more efficient and easier-to-use bait system,
which integrates both the tank and tray as a single unit.
"Isolate should further accelerate the adoption of ContraPest by
professionals and do-it-yourselfers," said Mr. Fruendt.
SenesTech is also in the final stages of releasing a soft bait
formulation, which provides the unique attributes of proven
fertility control in an industry-familiar format demanded by 'big
box' retailers, key e-commerce channels, and leading industry pest
management professionals.
"When we introduced ContraPest, we needed to convince the pest
control market of two things: the value of fertility control, and
the applicability of a liquid bait into their procedures. At this
point, there is growing acceptance of fertility control as part of
integrated pest management, but there is still resistance from some
pest management companies to alter their established practices of
utilizing non-liquid products. Therefore, we are introducing a soft
bait fertility control product with equivalent efficacy but more in
line with their current application methods. We believe that
this will greatly accelerate the penetration of fertility control
into pest management," said Mr. Fruendt. "This also provides a
format that readily fits the requirements for consumer use through
'big box' retailers."
Significant progress was made during the quarter to enhance
operational efficiencies, resulting in the lowering of the
Company's cash flow breakeven point. Revenues continued to grow
while there was a $500,000 decrease
in SG&A following the successful reconfiguration of its
e-commerce solution to improve the return on various marketing
investments. The various improvements led to an improvement in its
net loss by $576,000 and in its
Adjusted EBITDA loss by $599,000
compared to the year-ago period.
"With continued revenue growth, new product introductions,
expanded sales and distribution agreements, and a keen focus on
operational improvements to drive the business towards
profitability, I believe we made good progress over the past
quarter. With 126% sales growth during the month of July 2023, I believe we are well positioned for a
strong second half of the year," Fruendt concluded.
Q2 2023 Highlights
- Revenue during Q2 2023 was $305,000 compared to $277,000 in Q2 2022.
- Gross profit during Q2 2023 was $142,000, for a gross profit margin of 46%,
compared to $136,000, or a gross
profit margin of 49%, in Q2 2022. Gross profit margins excluding
one-time write-downs were 51% for Q2 2023.
- Net loss during Q2 2023 was $2.0
million, compared with a net loss of $2.6 million for Q2 2022.
- Adjusted EBITDA loss, which is a non-GAAP measure of operating
performance, for Q2 2023 was $1.7
million compared to $2.3
million in Q2 2022.
- Cash at the end of June 2023
was $2.2 million.
Use of Non-GAAP Measure
Adjusted EBITDA is a non-GAAP measure. However, this measure is
not intended to substitute for those financial measures reported in
accordance with GAAP. Adjusted EBITDA has been included because
management believes that, when considered together with the GAAP
figures, it provides meaningful information related to our
operating performance and liquidity and can enhance an overall
understanding of financial results and trends. Adjusted EBITDA may
be calculated by us differently than other companies that disclose
measures with the same or similar term. See our attached financials
for a reconciliation of this non-GAAP measure to the nearest GAAP
measure.
Conference Call Details
Date and Time: Thursday,
August 10, 2023, at 5:00 pm
ET
Call-in Information: Interested
parties can access the conference call by dialing (844) 308-3351 or
(412) 317-5407.
Live Webcast Information: Interested
parties can access the conference call via a live Internet webcast,
which is available in the Investor Relations section of the
Company's website at http://senestech.investorroom.com/.
Replay: A teleconference replay of the
call will be available for seven days at (877) 344-7529 or (412)
317-0088, replay access code 8370307. A webcast replay will be
available in the Investor Relations section of the Company's
website at http://senestech.investorroom.com/ for 90 days or
https://app.webinar.net/Dzmo6LojBkP.
About SenesTech
We are "The Pest Control Difference"
for the 21st century. We are rodent fertility control specialists
fueled by our passion to create a healthy environment by virtually
eliminating rodent pest populations. We keep an inescapable truth
in mind. Two rats and their descendants can be responsible for the
birth of up to 15,000 pups after a year. We invented ContraPest,
the only U.S. EPA-registered contraceptive for male and female
rats. ContraPest fits seamlessly into all integrated pest
management programs, significantly improving the overall goal of
effective rat management. We strive for clean cities, efficient
businesses and happy households – with a product designed to be
effective and sustainable without killing rats. At SenesTech, we
don't just eliminate rats. We make a better world.
For more information visit https://senestech.com/ and
https://contrapeststore.com.
Safe Harbor Statement
This press release contains "forward-looking statements" within
the meaning of federal securities laws, and we intend that such
forward-looking statements be subject to the safe harbor created
thereby. Such forward-looking statements include, among others, our
expectation that expanded product offering will drive future
growth; our belief that we successfully executed against a number
of key strategic imperatives to drive long-term growth in
ContraPest; our belief that the initiatives we have undertaken to
drive sales, improve our product quality, and expand product
options have shown success; our belief that rodent population
control becomes an increasingly important focus for pest management
professionals where the risk of exposure to rodenticides is
critical; our belief that we continue to innovate our product
offerings to provide customers with choices that fit their demands;
our belief that the Isolate Bait System is more efficient and
easier-to-use; our belief that Isolate should further accelerate
the adoption of ContraPest by professionals and do-it-yourselfers;
our belief that we are in the final stages of releasing a soft bait
formulation, which provides the unique attributes of proven
fertility control in an industry-familiar format demanded by 'big
box' retailers, key e-commerce channels, and leading industry pest
management professionals; our belief that there is growing
acceptance of fertility control as part of integrated pest
management, but there is still resistance from some pest management
companies to alter their established practices of utilizing
non-liquid applications; our belief that introducing a soft bait
fertility control product with equivalent efficacy but more in line
with pest management companies' current methods will greatly
accelerate the penetration of fertility control into pest
management; our belief that this also provides a format that
readily fits the requirements for consumer use through 'big box'
retailers; and our belief that with 126% sales growth during the
month of July 2023, we are well
positioned for a strong second half of the year. Forward-looking
statements may describe future expectations, plans, results, or
strategies and are often, but not always, made through the use of
words such as "believe," "may," "future," "plan," "will," "should,"
"expect," "anticipate," "eventually," "project," "estimate,"
"continuing," "intend" and similar words or phrases. You are
cautioned that such statements are subject to risks, uncertainties
and other factors that could cause actual results to differ
materially from those reflected by such forward-looking statements.
Such factors include, among others, the successful
commercialization of our products; market acceptance of our
products; our financial performance, including our ability to fund
operations; our ability to maintain compliance with Nasdaq's
continued listing requirements; and regulatory approval and
regulation of our products and other factors and risks identified
from time to time in our filings with the Securities and Exchange
Commission, including our Annual Report on Form 10-K for the fiscal
year ended December 31, 2022. All
forward-looking statements contained in this press release speak
only as of the date on which they were made and are based on
management's assumptions and estimates as of such date. Except as
required by law, we do not undertake any obligation to publicly
update any forward-looking statements, whether as a result of the
receipt of new information, the occurrence of future events or
otherwise.
CONTACT:
Investors: Robert Blum,
Lytham Partners, LLC, 602-889-9700,
senestech@lythampartners.com
Company: Tom Chesterman,
Chief Financial Officer, SenesTech, Inc., 928-779-4143
SENESTECH,
INC.
BALANCE
SHEETS
(In thousands, except
share and per share data)
(Unaudited)
|
|
|
June 30,
2023
|
|
December 31,
2022
|
ASSETS
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
2,196
|
|
$
4,775
|
Accounts receivable,
net
|
44
|
|
113
|
Prepaid
expenses
|
330
|
|
378
|
Inventory,
net
|
765
|
|
853
|
Total current
assets
|
3,335
|
|
6,119
|
Right to use assets,
operating leases
|
261
|
|
347
|
Property and equipment,
net
|
245
|
|
294
|
Other noncurrent
assets
|
22
|
|
22
|
Total
assets
|
$
3,863
|
|
$
6,782
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
120
|
|
$
540
|
Accrued
expenses
|
621
|
|
560
|
Current portion of
operating lease liability
|
188
|
|
180
|
Deferred
revenue
|
24
|
|
44
|
Total current
liabilities
|
953
|
|
1,324
|
Operating lease
liability, less current portion
|
83
|
|
179
|
Total
liabilities
|
1,036
|
|
1,503
|
Stockholders'
equity:
|
|
|
|
Common
stock
|
3
|
|
1
|
Additional paid-in
capital
|
129,057
|
|
127,481
|
Accumulated
deficit
|
(126,233)
|
|
(122,203)
|
Total stockholders'
equity
|
2,827
|
|
5,279
|
Total liabilities and
stockholders' equity
|
$
3,863
|
|
$
6,782
|
SENESTECH,
INC.
STATEMENTS OF
OPERATIONS
(In thousands, except
share and per share data)
(Unaudited)
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Revenues,
net
|
$
305
|
|
$
277
|
|
$
538
|
|
$
472
|
Cost of
sales
|
163
|
|
141
|
|
304
|
|
246
|
Gross
profit
|
142
|
|
136
|
|
234
|
|
226
|
Operating
expenses:
|
|
|
|
|
|
|
|
Research and
development
|
381
|
|
431
|
|
768
|
|
947
|
Selling, general and
administrative
|
1,761
|
|
2,277
|
|
3,511
|
|
4,184
|
Total operating
expenses
|
2,142
|
|
2,708
|
|
4,279
|
|
5,131
|
Loss from
operations
|
(2,000)
|
|
(2,572)
|
|
(4,045)
|
|
(4,905)
|
Other income,
net
|
7
|
|
3
|
|
15
|
|
4
|
Net loss
|
$
(1,993)
|
|
$
(2,569)
|
|
$
(4,030)
|
|
$
(4,901)
|
Weighted average shares
outstanding — basic and diluted
|
2,860,874
|
|
610,635
|
|
2,208,162
|
|
610,543
|
Loss per share — basic
and diluted
|
$
(0.70)
|
|
$
(4.21)
|
|
$
(1.83)
|
|
$
(8.03)
|
SenesTech
Inc.
Itemized
Reconciliation Between Net Loss and Adjusted EBITDA
(non-GAAP)
(In
thousands)
(Unaudited)
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Net loss (as reported,
GAAP)
|
$
(1,993)
|
|
$
(2,569)
|
|
$
(4,030)
|
|
$
(4,901)
|
Non-GAAP
adjustments:
|
|
|
|
|
|
|
|
Interest income,
net
|
(7)
|
|
(1)
|
|
(15)
|
|
(2)
|
Stock-based
compensation expense
|
170
|
|
248
|
|
336
|
|
430
|
Reserve for future
severance payments
|
119
|
|
—
|
|
119
|
|
—
|
Depreciation
expense
|
33
|
|
47
|
|
69
|
|
113
|
Gain on sale of
assets
|
—
|
|
(2)
|
|
—
|
|
(2)
|
Total non-GAAP
adjustments
|
315
|
|
292
|
|
509
|
|
539
|
Adjusted EBITDA loss
(non-GAAP)
|
$
(1,678)
|
|
$
(2,277)
|
|
$
(3,521)
|
|
$
(4,362)
|
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SOURCE SenesTech, Inc.