Back to Newsroom
Back to Newsroom

Healthy Extracts Reports Q2 2024 Net Revenue Up 54% to Record High, Driving Positive EPS

Wednesday, 14 August 2024 08:31 AM

HEALTHY EXTRACTS INC.

Topic:
Earnings

Strong Subscription-Based Revenue Growth and Third Sequential Positive Cash Flow Quarter

LAS VEGAS, NV / ACCESSWIRE / August 14, 2024 / Healthy Extracts Inc. (OTCQB:HYEX), a platform for acquiring, developing, patenting, marketing, and distributing plant-based nutraceuticals that target select high-growth categories within the multibillion-dollar nutraceuticals market, reported results for the three and six months ended June 30, 2024. All comparisons are to the same year-ago period unless otherwise noted.

Q2 2024 Financial Highlights

  • Net revenue increased 54% to a record $908,000, driven primarily by distribution channel expansion, particularly wholesale, and growth in subscription-based revenue.

  • Gross profit increased 71% to $486,000 with gross margin up 510 basis points to 53.5% due to manufacturing efficiency and product mix.

  • Achieved third sequential positive cash flow quarter, generating approximately $80,000 in the quarter.

  • Operating expenses decreased 68% to $498,000 in the quarter.

  • Net income of $113,500 or $0.04 per basic and diluted share.

  • Amazon "Subscribe & Save" customers at June 30, 2024 increased 70% year-over-year to a record number of subscribers. Direct-to-consumer subscription customers (excluding Amazon) at June 30, 2024 increased 26% year-over-year. Subscription growth helps reduce customer acquisition costs, increases traction, and provides greater visibility into future revenue.

Management Commentary

"In Q2, our record-breaking top-line growth, margin expansion, and improved cash flow were driven by strong gains in both direct-to-consumer and wholesale sales," stated Healthy Extracts President, Duke Pitts. "Even aside from wholesale that was unusually high for the quarter, we surpassed our earlier stated expectations for the quarter, reflecting growing momentum with our target retail customers.

"During the quarter we also strengthened our financial foundation, reducing debt by more than $108,000 while simultaneously increasing our cash reserves. In fact, our debt restructuring and streamlining in Q2 resulted in an additional $15,000 per month in positive cash flow. As a result, we achieved our third consecutive quarter of positive cash flow, generating approximately $80,000. We are planning to reinvest this cash flow into further expanding our product offerings and revenue streams, including the valuable recurring revenue from product subscriptions.

"For our Amazon "Subscribe & Save" offers, we generated record sales on Amazon in July, primarily as a result of our sales and marketing efforts during Prime Day. We expect Amazon sales to continue to be strong in the coming months.

"Given our success with the Amazon "Subscribe and Save" offer, in July we replaced our traditional buy-2-get-1 offers on our DTC eCommerce website with a 20% discount for subscribing to monthly shipments. We expect this move to increase sales and margins, as well as the lifetime value of our customers. In fact, the new offer has been well received, generating a significant increase in overall subscriber growth during the first several weeks.

"Looking ahead, we anticipate continued strong performance in top-line growth, increased cash flow, profitability, and market share expansion as our addressable markets strengthen. This growth will be largely driven by the launch of new products that will benefit from the broad market channels we have strategically developed and invested in over the past several years. These investments have proven to be the most effective way to create significant shareholder value, and this will continue to be our top priority."

2024 Financial Outlook

For the remainder of 2024, the company anticipates continued growth with new product introductions laying a path for higher profits excluding non-cash transactions.

2024 Product Outlook

Healthy Extracts' top brand ambassador and renowned fitness expert, Whitney Johns, is preparing to launch WHITNEY JOHNSâ„¢ NUTRITION on-the-go gel packs for COLLAGEN (anti-aging) in the second half of 2024. These products will be based on Healthy Extracts' exclusive oral delivery system and proprietary formulations.

The company is also planning to launch in the second half of 2024 its new BergaMet MYNUS sugar blocker, which is specially formulated to reduce up to 42% of the sugar impact from meals. The MYNUS on-the-go gel-packs will be made available under the company's exclusive U.S. and Canadian licensing and manufacturing agreement with Gelteq.

Q2 2024 Financial Summary

Net revenue in the second quarter of 2024 increased 54% to $908,000 from $588,000 in the same year-ago quarter, primarily due to distribution channel expansion and to a lesser extent the growth in subscription-based revenue.

Gross profit totaled $486,000 or 53.5% of net revenue as compared to $285,000 or 48.4% of net revenue in the same year-ago quarter. The increase in gross margin was a result of manufacturing efficiency and product mix.

Operating expenses decreased 68% to $498,000 as compared to $1.5 million in the same year-ago quarter. The decrease in operating expenses was primarily due to one-time expenses in the year-ago quarter related to the company's planned uplist to Nasdaq and issuance of options and warrants that did not reoccur in the second quarter of 2024, and to a lesser extent the reduction in general operating expense in the second quarter of 2024.

Net income totaled $113,500 or $0.04 per basic and diluted share, as compared to a net loss of $1.3 million or $(0.44) per basic and diluted share in the same year-ago period, with the improvement primarily due to the decreased expenses and a change in the fair value of derivative expense.

Excluding costs related to the company's planned acquisition and public offering expenses, regulatory expense, stock-based compensation expense, change in fair value of derivative expense and interest expense, net income in the second quarter of 2024 totaled $37,000 or $0.01 per basic and diluted share.

First Half 2024 Financial Summary

Net revenue in the second half of 2024 increased 33% to $1.6 million from $1.2 million in the same year-ago period, primarily due to product line and distribution channel expansion.

Gross profit totaled $894,000 or 56.0% of net revenue as compared to $563,000 or 46.8% of net revenue in the same year-ago period. The increase in gross margin was a result of product mix sold, and the decrease in manufacturing and freight costs.

Operating expenses decreased 56% to $968,000 compared to the same year-ago period. The decrease in operating expenses was primarily due to one-time expenses in the same year-ago period related to the company's planned uplist to Nasdaq and the issuance of options and warrants that did not reoccur in the first half of 2024, and to a lesser extent the reduction in general operating expense in the first half of 2024.

Net loss for the first half of 2024 totaled $0.7 million or $(0.25) per basic and diluted share, as compared to $1.8 million or $(0.64) per basic and diluted share. The improvement in net loss was primarily due to the same factors in the second quarter of 2024.

Excluding costs related to the company's planned acquisition and public offering expenses, regulatory expense, stock compensation expense, change in fair value on derivative expense and interest expense, net income totaled $25,000 or $0.01 per basic and diluted share.

About Healthy Extracts "Live Life Young Again"

Healthy Extracts Inc.is a platform for acquiring, developing, researching, patenting, marketing, and distributing plant-based nutraceuticals.

The company's subsidiaries, BergametNAâ„¢ and Ultimate Brain Nutrientsâ„¢ (UBN), offer nutraceutical natural heart and brain health supplements. This includes the only heart health supplement distributed in North America containing Citrus Bergamot SuperFruitâ„¢. This superfruit has the highest known concentration of polyphenols and flavonoids.

UBN's KETONOMICS® proprietary formulations, which have been designed to enhance brain activity, focus, headache and cognitive behavior, provide many sales and intellectual property licensing opportunities.

For more information visit: healthyextractsinc.com, bergametna.com or tryubn.com.

Forward-Looking Statements and Safe Harbor Notice

All statements other than statements of historical facts included in this press release are "forward-looking statements" (as defined in the Private Securities Litigation Reform Act of 1995). Such forward-looking statements include our expectations and those statements that use forward-looking words such as "projected," "expect," "possibility" and "anticipate." The achievement or success of the matters covered by such forward-looking statements involve significant risks, uncertainties and assumptions. Actual results could differ materially from current projections or implied results. Investors should read the risk factors set forth in the Company's Annual Report on Form 10-K filed with the SEC on April 1, 2024, and future periodic reports filed with the SEC. All of the Company's forward-looking statements are expressly qualified by all such risk factors and other cautionary statements. The Company cautions that statements and assumptions made in this news release constitute forward-looking statements and make no guarantee of future performance. Forward-looking statements are based on estimates and opinions of management at the time statements are made. The information set forth herein speaks only as of the date hereof. The Company and its management undertake no obligation to revise these statements following the date of this news release.

Food & Drug Administration Disclosure

The product and formulation featured in this release is not for use by or sale to persons under the age of 12. This product should be used only as directed on the label. Consult with a physician before use if you have a serious medical condition or use prescription medications. A doctor's advice should be sought before using this and any supplemental dietary product. These statements have not been evaluated by the FDA. This product is not intended to diagnose, treat, cure or prevent any disease.

BergametNA™, Ultimate Brain Nutrients™, UBN™, Citrus Bergamot SuperFruit™ and F4T® are registered trademarks of Healthy Extracts Inc.™

Company Contact

Duke Pitts, President
Healthy Extracts Inc.
Tel (720) 463-1004
Email contact

Investor Contact

Ronald Both
CMA Investor Relations
Tel (949) 432-7566
Email contact

HEALTHY EXTRACTS, INC.
CONSOLIDATED BALANCE SHEETS
AS OF JUNE 30, 2024 AND DECEMBER 31, 2023
(Unaudited)

JUNE 30

DECEMBER 31,


2024

2023

ASSETS






CURRENT ASSETS



Cash

$

148,231

$

19,441

Accounts receivable

90,560

30,440

Inventory, net

1,319,622

1,626,283

Offering costs

149,274

151,931

Right of use asset, net

41,077

71,583

Total current assets

1,748,764

1,899,678


Fixed assets

3,852

3,306

Patents/Trademarks

521,881

521,881

Deposit

16,890

16,890

Goodwill

193,260

193,260


Total other assets

735,883

735,336


TOTAL ASSETS

$

2,484,646

$

2,635,014



LIABILITIES AND STOCKHOLDERS' EQUITY


LIABILITIES

Accounts payable

$

54,020

$

116,842

Accrued liabilities

188,593

215,069

Lease liabilities - current

42,745

65,229

Lease liabilities - long-term

-

9,222

Notes payable

214,424

361,093

Notes payable - related party

178,366

83,366

Convertible debt, net of discount

601,251

608,601

Accrued interest payable

55,428

64,386

Accrued interest payable - related party

13,198

2,465

Derivative liabilities

736,623

154,150

Total current and total liabilities

2,084,646

1,680,424



STOCKHOLDERS' EQUITY

Preferred stock, $0.001 par value, 75,000,000 shares authorized, none and none shares issued and outstanding, respectively

-

-

Common stock, $0.001 par value, 50,000,000 shares authorized, 2,993,572 shares issued and outstanding as of June 30, 2024, and 2,954,104 shares issued and outstanding as of December 31, 2023, respectively

354,532

354,492

Additional paid-in capital

19,192,899

18,999,770

Accumulated deficit

(19,147,431

)

(18,399,673

)

Total stockholders' equity

400,000

954,590


TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

2,484,646

$

2,635,014



HEALTHY EXTRACTS, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDING JUNE 30, 2024 AND 2023
(Unaudited)

FOR THE 3 MONTH ENDING

FOR THE SIX MONTHS ENDING


JUNE 30

JUNE 30


2024

2023

2024

2023






REVENUE





Revenue

$

908,389

$

588,484

$

1,597,175

$

1,203,427

Net revenue

908,389

588,484

1,597,175

1,203,427


COST OF REVENUE

Cost of goods sold

422,301

303,415

702,728

640,517

Total cost of revenue

422,301

303,415

702,728

640,517


GROSS PROFIT

486,088

285,069

894,446

562,911


OPERATING EXPENSES

General and administrative

497,996

1,540,942

968,427

2,223,972

Total operating expenses

497,996

1,540,942

968,427

2,223,972


OTHER INCOME (EXPENSE)

Interest expense, net of interest income

(48,748

)

(25,212

)

(91,305

)

(114,272

)

Change in fair value on derivative

174,156

13,850

(582,472

)

(71,058

)


Total other income (expense)

125,408

(11,362

)

(673,777

)

(185,331

)


Net income/(loss) before income tax provision

113,500

(1,267,235

)

(747,758

)

(1,846,392

)


NET INCOME/(LOSS)

$

113,500

$

(1,267,235

)

$

(747,758

)

$

(1,846,392

)



Income/(Loss) per share - basic and diluted

$

0.04

$

(0.44

)

$

(0.25

)

$

(0.64

)


Weighted average number of shares outstanding - basic and diluted

2,967,281

2,878,146

2,967,281

2,878,629


HEALTHY EXTRACTS, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)

FOR THE SIX MONTH ENDING

JUNE 30

2024

2023

Cash Flows from Operating Activities:



Net Income/(Loss)

$

(747,758

)

$

(1,846,392

)


Adjustments to reconcile net loss to net cash

used in operating activities:

Depreciation and amortization

(547

)

1,098

Warrants issued for services

193,168

1,148,857

Change in fair value on derivative liability

582,472

71,058

Changes in operating assets and liabilities:

Accounts receivable

(60,120

)

(9,106

)

Inventory

306,661

354,503

Offering Costs

2,657

-

Cost in acquisition of Hyperion/OP&M

-

(65,617

)

Right of use asset, net

30,506

(100,623

)

Note receivable

-

(34,500

)

Accounts payable

(62,822

)

21,011

Accrued liabilities

(26,476

)

(65,883

)

Accrued interest payable

(8,958

)

18,555

Accrued interest payable - related party

10,732

-

Lease liability - current

(22,484

)

56,139

Lease liability - long-term

(9,222

)

47,409

Net Cash used in Operating Activities

187,809

(403,493

)


Cash Flows from Investing Activities:


Purchase of fixed assets

-

-

Gain on sale of asset

-

-

Cash flows provided by (used in) Investing Activities:

-

-


Cash Flows from Financing Activities:


Proceeds from issuance of common stock

(0

)

-

Proceeds from issuance of convertible debt

25,926

350,000

Proceeds from issuance of noted payable

120,669

431,000

Proceeds from issuance of noted payable - related party

95,000

-

Loan origination fees

-

68,888

Net Cash provided by Financing Activities

(59,019

)

430,342


Increase (decrease) in cash

128,790

26,850

Cash at beginning of period

19,441

65,651

Cash at end of period

$

148,231

$

92,501



ACCESSWIRE | Article Logo

SOURCE: HEALTHY EXTRACTS INC.

Topic:
Earnings
Back to newsroom
Back to Newsroom

Contact Us Today


If you have questions or want to learn more about our products, our team’s here to help!

Share by: