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ChromaDex Corporation Reports 2017 Financial Results   
Fourth Quarter 2017 Net Revenues Increased by 69% to $7.5 Million

IRVINE, Calif., March 08, 2018 (GLOBE NEWSWIRE) -- ChromaDex Corporation (NASDAQ:CDXC), a science-based, integrated nutraceutical company devoted to improving the way people age, announced today fourth quarter and full year 2017 financial results.

Results of operations for the three months ended Dec. 30, 2017

For the three months ended Dec. 30, 2017 (“Q4 2017”), ChromaDex reported net sales from continuing operations of $7.5 million, up 69% compared to $4.5 million from continuing operations in the fourth quarter of 2016. The increase in fourth quarter revenues was driven by growth in sales of TRU NIAGEN®.

Gross profit improved in the fourth quarter of 2017 to 50.9% as compared to 45.1% for the same period in 2016. We experienced better margins due to the positive impact of TRU NIAGEN® consumer product sales, which we anticipate will continue.

Operating expenses were $12.6 million in the fourth quarter of 2017, compared to $4.2 million from continuing operations in the same period for 2016. The increase in operating expenses for fourth quarter was the result of our strategic decision to invest in marketing to build out the TRU NIAGEN brand, as well as legal costs associated with ongoing litigation and higher stock-based compensation expense.

The net loss attributable to common stockholders for the fourth quarter of 2017 was $8.8 million or ($0.17) per share as compared to a net loss of $2.1 million or ($0.06) per share for Q4 2016. The higher losses in the fourth quarter were the result of the strategic decision to invest ahead of growth, higher legal fees associated with ongoing litigation and higher stock-based compensation expense, partially offset by higher sales volume and gross profits.   

For the fourth quarter of 2017, the reported loss from continuing operations was negatively impacted by a non-cash charge of $3.4 million related to stock-based compensation.

Adjusted EBITDA, a non-GAAP measure, was ($5.2) million for Q4 2017, compared to adjusted EBITDA of ($1.7) million for Q4 2016. ChromaDex defines Adjusted EBITDA as net income (loss) adjusted for income tax, interest, depreciation, amortization and non-cash stock compensation costs. The Basic and Diluted Adjusted EBITDA per share for Q4 2017 was ($0.10) versus ($0.05) for Q4 2016.

We also ended the fourth quarter of 2017 with a solid balance sheet with quarter-end cash of $45.4 million.

“We continue to see validation from the research community, as evidence builds through peer-reviewed publications,” said Frank Jaksch, Jr., CEO and co-founder of ChromaDex. “Our undisputed leadership in NAD research will be the foundation of continued growth for TRU NIAGEN.”

Rob Fried, President and Chief Operating Officer commented: “It has been less than a year since we made the strategic decision to focus on TRU NIAGEN and NAD. We are very pleased with the increase in gross margin which reflects the growing value of the TRU NIAGEN brand. Our strategy is thus far playing out ahead of plan.”

Results of operations for the year ended Dec. 30, 2017

For full year 2017, net revenues were $21.2 million from continuing operations, down 2% compared to $21.7 million from continuing operations for full year 2016 as the Company shifted to an integrated global consumer product nutraceutical company.

Gross profit improved in the full year 2017 to 49.4% as compared to 48.0% for the same period in 2016.  We experienced slightly better margins due to the positive impact of TRU NIAGEN consumer product.

For full year 2017, operating expenses from continuing operations were $26.9 million, compared to $13.3 million from continuing operations for full year 2016 as we invested in marketing expenditures to build out the TRU NIAGEN brand. The increase in operating expenses was also due to legal costs associated with ongoing litigation and higher stock-based compensation expense.

The net loss attributable to common stockholders for full year 2017 was $11.4 million or ($0.26) per share as compared to a net loss of $2.9 million or ($0.08) per share for full year 2016. 

Adjusted EBITDA a non-GAAP measure, was ($5.9) million for 2017, compared to adjusted EBITDA of ($0.9) million for 2016. The Basic and Diluted Adjusted EBITDA per share for 2017 was ($0.13) versus ($0.03) for 2016.

Outlook

For 2018, the Company expects to show significant growth in sales driven by our U.S. ecommerce and Watsons business and the launch of TRU NIAGEN in new international markets.  We expect the growth to be skewed toward the second half of the year. We will continue to invest in marketing expenditures to build out the TRU NIAGEN brand, infrastructure, and new capabilities to support growth. 

Investor Conference Call

ChromaDex management will host an investor conference call to discuss the year end results and provide a general business update on Thurs., March 8, at 4:30pm ET.

Participants should call in at least 10 minutes prior to the call. The dial-in information is as follows:

U.S. Toll-Free Number: (866) 327-8118
International Dial-In Number:    (678) 509-7526
Conference ID: 9787028
Webcast link: https://edge.media-server.com/m6/p/8kcvfrii


The webcast replay will be available after the completion of the call on the Investor Relations section of the Company website, www.chromadex.com.

The earnings press release, and its accompanying financial exhibits, will be available on the Investor Relations section of the Company website, www.chromadex.com.

About Non-GAAP Financial Measures

ChromaDex’s non-GAAP financial measures exclude interest, tax, depreciation, amortization and share-based compensation. ChromaDex used these non-GAAP measures when evaluating its financial results as well as for internal resource management, planning and forecasting purposes. These non-GAAP measures should not be viewed in isolation from or as a substitute for ChromaDex’s financial results in accordance with GAAP. A reconciliation of GAAP to non-GAAP measures is attached to this press release.

About ChromaDex:

ChromaDex Corp. is an integrated, global nutraceutical company devoted to improving the way people age. ChromaDex scientists partner with leading universities and research institutions worldwide to uncover the full potential of NAD and identify and develop novel, science-based ingredients. Its flagship ingredient, NIAGEN® nicotinamide riboside, sold directly to consumers as TRU NIAGEN®, is backed with clinical and scientific research, as well as extensive IP protection. TRU NIAGEN® is helping the world AGE BETTER®. To learn more about ChromaDex, please visit www.ChromaDex.com.

Important Note on Forward Looking Statements and 2017 Financial Results:

Statements contained in this press release regarding matters that are not historical facts are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act. Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Such statements include statements regarding the Company’s fourth quarter and full year 2017 financial results, continued growth in revenue and gross profits and continued validation of our science. The financial information included herein for the fourth quarter and full year 2017 are preliminary, unaudited results and may change materially, including as a result of the finalization of financial statements for the Company’s fourth quarter and full year ended December 30, 2017, completion of the Company’s audit by the Company’s independent registered public accounting firm and other factors and adjustments related to the Company’s financial reporting process. Other risks that contribute to the uncertain nature of the forward-looking statements are reported in our most recent Forms 10-Q and 10-K as filed with the SEC. There can be no assurance that our final results for the year will not differ from these estimates and that such changes will not be material; accordingly, these statements should not be viewed or relied upon as a substitute for complete audited financial statements to be prepared in accordance with GAAP (Generally Accepted Accounting Principles) or as a measure of our actual performance. The Company plans to file its 2017 Annual Report on Form 10-K with the SEC on or around March 15, 2018.  The 2017 Annual Report on Form 10-K will include audited financial statements for the year ended December 30, 2017.   

ChromaDex Investor Relations Contact:

Andrew Johnson, Director of Investor Relations

949-419-0288

andrewj@chromadex.com

ChromaDex Public Relations Contact:

Breah Ostendorf, Director of Marketing

949-537-4103

breaho@chromadex.com


 

ChromaDex Corporation and Subsidiaries    
Consolidated Statements of Operations    
Three Months Ended December 30, 2017 and December 31, 2016  
     
  Q4 2017 Q4 2016
     
Sales, net $   7,530,836   $   4,452,783  
Cost of sales     3,695,837       2,442,714  
     
Gross profit     3,834,999       2,010,069  
     
Operating expenses:    
Sales and marketing     2,401,046       368,200  
Research and development     1,452,668       534,171  
General and administrative     8,759,068       3,279,624  
Operating expenses     12,612,782       4,181,995  
     
Operating loss     (8,777,783 )     (2,171,926 )
     
Nonoperating income (expense):    
Interest expense, net     (44,033 )     (18,360 )
Nonoperating expenses     (44,033 )     (18,360 )
     
Loss before income taxes     (8,821,816 )     (2,190,286 )
Provision for income taxes     -       3,500  
     
Loss from continuing operations     (8,821,816 )     (2,186,786 )
     
Income from discontinued operations     -       40,033  
     
Net loss $   (8,821,816 ) $   (2,146,753 )
     
Basic and diluted earnings (loss) per common share:    
  Loss from continuing operations $   (0.17 ) $   (0.06 )
  Earnings from discontinued operations $   -    $   0.00  
     
Basic and diluted loss per common share $   (0.17 ) $   (0.06 )
     
Basic and diluted weighted average common shares outstanding     51,178,664       37,904,534  
     


ChromaDex Corporation and Subsidiaries    
Consolidated Statements of Operations    
Years Ended December 30, 2017 and December 31, 2016    
     
  2017 2016
     
Sales, net $   21,201,482   $   21,664,648  
Cost of sales     10,724,177       11,274,114  
     
Gross profit     10,477,305       10,390,534  
     
Operating expenses:    
Sales and marketing     4,459,224       1,558,213  
Research and development     4,007,381       2,522,768  
General and administrative     17,641,889       9,214,763  
Other     745,773       -  
Operating expenses     26,854,267       13,295,744  
     
Operating loss     (16,376,962 )     (2,905,210 )
     
Nonoperating income (expense):    
Interest expense, net     (152,784 )     (333,286 )
Loss on debt extinguishment     -       (313,099 )
Nonoperating expenses     (152,784 )     (646,385 )
     
Loss from continuing operations     (16,529,746 )     (3,551,595 )
     
Income (loss) from discontinued operations     (315,140 )     623,410  
Gain on sale of discontinued operations     5,467,268       -  
     
Income from discontinued operations, net     5,152,128       623,410  
     
Net loss $   (11,377,618 ) $   (2,928,185 )
     
Basic and diluted earnings (loss) per common share:    
  Loss from continuing operations $   (0.37 ) $   (0.10 )
  Earnings from discontinued operations $   0.11   $   0.02  
     
Basic and diluted loss per common share $   (0.26 ) $   (0.08 )
     
Basic and diluted weighted average common shares outstanding     44,598,879       37,294,321  
     


Consolidated Statements of Operations, Unaudited   Effects of Charges associated with Interest, Tax, Depreciation,   Consolidated Statements of Operations, Adjusted EBITDA
 (US GAAP)   Amortization and Share-based Compensation Expense   Excluding Interest, Tax, Depreciation, Amortization and
        Share-based Compensation (Non-GAAP Presentation)
Three Months Ended December 30, 2017 and December 31, 2016   Three Months Ended December 30, 2017 and December 31, 2016   Three Months Ended December 30, 2017 and December 31, 2016
                     
  Q4 2017 Q4 2016     Q4 2017 Q4 2016     Q4 2017 Q4 2016
                     
Sales, net $   7,530,836   $  4,452,783     Sales, net $   -   $   -     Sales, net $   7,530,836   $   4,452,783  
Cost of sales     3,695,837       2,442,714     Cost of sales     (58,546 )     (18,405 )   Cost of sales     3,637,291       2,424,309  
                     
Gross profit     3,834,999      2,010,069     Gross profit     58,546       18,405     Gross profit     3,893,545       2,028,474  
                     
Operating expenses:       Operating expenses:       Operating expenses:    
Sales and marketing     2,401,046       368,200     Sales and marketing     (1,857 )     -     Sales and marketing     2,399,189       368,200  
Research and development     1,452,668       534,171     Research and development     (41,654 )     (10,494 )   Research and development     1,411,014       523,677  
General and administrative     8,759,068       3,279,624     General and administrative     (3,464,320 )     (294,518 )   General and administrative     5,294,748       2,985,106  
Operating expenses     12,612,782       4,181,995     Operating expenses     (3,507,831 )     (305,012 )   Operating expenses     9,104,951       3,876,983  
                     
Operating loss    (8,777,783 )   (2,171,926 )   Operating income     3,566,377       323,417     Operating loss    (5,211,406 )    (1,848,509 )
                     
Nonoperating income (expense):       Nonoperating income (expense):       Nonoperating income (expense):    
Interest expense, net     (44,033 )     (18,360 )   Interest expense, net     44,033       18,360     Interest expense, net     -       -  
Nonoperating expenses     (44,033 )     (18,360 )   Nonoperating income     44,033       18,360     Nonoperating expenses     -       -  
                     
Loss before income taxes    (8,821,816 )    (2,190,286 )   Income before income taxes     3,610,410       341,777     Loss before income taxes    (5,211,406 )    (1,848,509 )
Provision for income taxes     -       3,500     Provision for income taxes     -       (3,500 )   Provision for income taxes     -       -  
                     
Loss from continuing operations    (8,821,816 )    (2,186,786 )   Income from continuing operations     3,610,410       338,277     Loss from continuing operations    (5,211,406 )    (1,848,509 )
                     
Income from discontinued operations     -       40,033     Income from discontinued operations     -       70,352     Income from discontinued operations     -       110,385  
                     
Net loss $  (8,821,816 ) $  (2,146,753 )   Effects of adjusted EBITDA $   3,610,410   $   408,629     Adjusted EBITDA $  (5,211,406 ) $  (1,738,124 )
                     
Basic and diluted earnings (loss) per common share:       Effects of adjusted EBITDA per common share:       Basic and diluted adjusted EBITDA per common share:  
  Loss from continuing operations $   (0.17 ) $   (0.06 )     From continuing operations $   0.07   $   0.01       From continuing operations $   (0.10 ) $   (0.05 )
  Earnings from discontinued operations $   -   $   0.00       From discontinued operations $   -   $   0.00       From discontinued operations $   -   $   0.00  
                     
Basic and diluted loss per common share $   (0.17 ) $   (0.06 )   Effects of adjusted EBITDA per common share $   0.07   $   0.01     Basic and diluted adjusted EBITDA per common share $   (0.10 ) $   (0.05 )
                     
Weighted average common shares outstanding       Weighted average common shares outstanding       Weighted average common shares outstanding    
  Basic and diluted    51,178,664      37,904,534       Basic and diluted    51,178,664      37,904,534       Basic and diluted    51,178,664      37,904,534  
                     


Consolidated Statements of Operations   Effects of Charges associated with Interest, Tax, Depreciation,   Consolidated Statements of Operations, Adjusted EBITDA
 (US GAAP)   Amortization and Share-based Compensation Expense   Excluding Interest, Tax, Depreciation, Amortization and
        Share-based Compensation (Non-GAAP Presentation)
Years Ended December 30, 2017 and December 31, 2016   Years Ended December 30, 2017 and December 31, 2016   Years Ended December 30, 2017 and December 31, 2016
                     
  2017 2016     2017 2016     2017 2016
                     
Sales, net $  21,201,482   $  21,664,648     Sales, net $   -   $   -     Sales, net $  21,201,482   $  21,664,648  
Cost of sales    10,724,177      11,274,114     Cost of sales     (178,109 )     (42,589 )   Cost of sales    10,546,068      11,231,525  
                     
Gross profit    10,477,305      10,390,534     Gross profit     178,109       42,589     Gross profit    10,655,414      10,433,123  
                     
Operating expenses:       Operating expenses:       Operating expenses:    
Sales and marketing     4,459,224       1,558,213     Sales and marketing     (2,381 )     -     Sales and marketing     4,456,843       1,558,213  
Research and development     4,007,381       2,522,768     Research and development     (132,285 )     (10,493 )   Research and development     3,875,096       2,512,275  
General and administrative    17,641,889       9,214,763     General and administrative    (4,838,865 )    (1,305,505 )   General and administrative    12,803,024       7,909,258  
Other     745,773       -     Other     -       -     Other     745,773       -  
Operating expenses    26,854,267      13,295,744     Operating expenses    (4,973,531 )    (1,315,998 )   Operating expenses    21,880,736      11,979,746  
                     
Operating loss    (16,376,962 )    (2,905,210 )   Operating income     5,151,640       1,358,587     Operating loss    (11,225,322 )    (1,546,623 )
                     
Nonoperating income (expense):       Nonoperating income (expense):       Nonoperating income (expense):    
Interest expense, net     (152,784 )     (333,286 )   Interest expense, net     152,784       333,286     Interest expense, net     -       -  
Loss on debt extinguishment     -       (313,099 )   Loss on debt extinguishment     -       -     Loss on debt extinguishment     -       (313,099 )
Nonoperating expenses     (152,784 )     (646,385 )   Nonoperating income     152,784       333,286     Nonoperating expenses     -       (313,099 )
                     
Loss from continuing operations    (16,529,746 )    (3,551,595 )   Loss from continuing operations     5,304,424       1,691,873     Loss from continuing operations    (11,225,322 )    (1,859,722 )
                     
Income (loss) from discontinued operations     (315,140 )     623,410     Income from discontinued operations     193,889       291,121     Income (loss) from discontinued operations     (121,251 )     914,531  
Gain on sale of discontinued operations     5,467,268       -     Gain on sale of discontinued operations     -       -     Gain on sale of discontinued operations     5,467,268       -  
                     
Income from discontinued operations, net     5,152,128       623,410     Income from discontinued operations, net     193,889       291,121     Income from discontinued operations, net     5,346,017       914,531  
                     
Net loss $  (11,377,618 ) $  (2,928,185 )   Effects of adjusted EBITDA $   5,498,313   $   1,982,994     Adjusted EBITDA $   (5,879,305 ) $   (945,191 )
                     
Basic and diluted earnings (loss) per common share:       Effects of adjusted EBITDA per common share:       Basic and diluted adjusted EBITDA per common share:    
  Loss from continuing operations $   (0.37 ) $   (0.10 )     From continuing operations $   0.12   $   0.05       From continuing operations $   (0.25 ) $   (0.05 )
  Earnings from discontinued operations $   0.11   $   0.02       From discontinued operations $   0.00   $   0.00       From discontinued operations $   0.12   $   0.02  
                     
Basic and diluted loss per common share $   (0.26 ) $   (0.08 )   Effects of adjusted EBITDA per common share $   0.12   $   0.05     Basic and diluted adjusted EBITDA per common share $   (0.13 ) $   (0.03 )
                     
Weighted average common shares outstanding       Weighted average common shares outstanding       Weighted average common shares outstanding    
  Basic and diluted     44,598,879      37,294,321       Basic and diluted    44,598,879      37,294,321       Basic and diluted     44,598,879      37,294,321  
                     

 

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