Neptune Wellness Solutions (NEPT) Misses Q4 EPS by 11c

Neptune Wellness Solutions (NASDAQ: NEPT) reported Q4 EPS of ($0.13), $0.11 worse than the analyst estimate of ($0.02).

First Quarter 2021 Financial Highlights:

• Total revenues for the three-month period ended June 30, 2020 amounted to $21,363, representing a sequential increase of $11,833, or 124%, over the fourth quarter ended March 31, 2020 and an increase of $17,002, or 390%, compared to $4,361 for the three-month period ended June 30, 2019.
• Gross profit for the three-month period ended June 30, 2020 amounted to $3,256, representing a sequential increase of $4,353 over the fourth quarter ended March 31, 2020 and an increase of $3,969 over the three-month period ended June 30, 2019. Gross margin improved to 15.2% compared to negative gross margins in both of the comparative periods, reflecting improved margins as a result of volume growth in cannabis.
• Net loss for the three-month period ended June 30, 2020 amounted to $11,427 compared to a net loss of $6,452 for the three-month period ended June 30, 2019.
• Adjusted EBITDA1 improved by $227 for the three-month period ended June 30, 2020 to a loss of $3,356 compared to the three-month period ended June 30, 2019. The increase in Adjusted EBITDA1 is mainly attributable to the increase in gross profit, partially offset by an increase in SG&A expenses.
• Neptune establishes second quarter fiscal 2021 revenue guidance of between $28,000 and $32,000, representing a sequential growth of approximately 31% to 50% compared to the previous quarter or approximately 330% to 391% growth over the prior year period.

Michael Cammarata, Chief Executive Officer of Neptune, stated: "Our transformation to a diversified and fully integrated health and wellness company has yielded significant results. We have built the team, the partnerships and developed a pipeline of innovation across the health and wellness landscape to drive further growth over the coming quarters and years. Our pace of new product and category development has accelerated, and we are fully leveraging our assets to drive profit accretive growth with limited incremental capital investment. Each of our new product launches are designed to drive higher margins and higher returns on investment to maximize returns and support incremental growth opportunities. We are seeing improved gross margins while accelerating growth, and as volumes continue to build, we expect further enhancements to our profit profile. During the first quarter, both our Health and Wellness Innovations and Cannabis activities delivered significant growth, driven by strong partnerships and our ability to quickly execute on emerging opportunities. We are anticipating strong growth in the second quarter and expect the accelerated growth to continue."

Dr. Toni Rinow, Chief Financial Officer of Neptune, commented: "We have made significant investments over the last year, including expanding capacity and building a world-class team. We are now leveraging these investments, resulting in accelerated growth and improving margins. We anticipate both to continue and our guidance for second quarter revenue to nearly quadruple once again on a year-over-year basis. In addition to being focused on innovation to drive revenue, it is part of our core financial strategy of closely monitoring the profitability of our new business development to enhance margins and capitalize on asset-light innovations. We have improved our cash position to support growth and are working on additional, non-dilutive, sources of capital to support continued growth. We are seeing strong momentum with our recent hand sanitizer introduction into the club channel, which began early in the second quarter, but are also seeing continued growth in cannabis with existing key partners and new business."

For earnings history and earnings-related data on Neptune Wellness Solutions (NEPT) click here.

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