The Neptune Wellness Solutions Inc (NASDAQ: NEPT) stock price soared 112.6%, as of 9:35 EST, after releasing its Q1 2024 financial results. The consumer packaged goods (CPG) company revealed that its gross profit margins for its Sprout brand were 26%, while its Biodroga brand had a gross profit margin of 28%.
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The supplements company, focused on plant-based, sustainable and purpose-driven lifestyle brands, also announced that it continues prioritising cost management and implementing measures to increase operational efficiency throughout the business. The company expects to report further cost savings throughout the fiscal year.
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The company reported consolidated net revenues of $10.6 million, marking a decline from the $16.3 million recorded in a similar period last year. The decline was attributed to a $2.7 million drop in Cannabis revenues after the business was divested. Furthermore, a $2.9 million drop in nutraceutical revenues also contributed to the lower revenues.
Neptune Wellness also reported a gross profit of $2.8 million versus a gross loss of $4.5 million in the previous year. The increase in food and beverage revenues was the primary driver behind the gross profits, combined with cost-cutting measures and the divestiture of the cannabis business.
The supplements company reported a Q1 2024 net loss of $6.4 million versus a reported net loss of $6.5 million in a similar period last year. The firm also reported an adjusted pretax loss of $7.3 million versus an $11.4 million loss in Q1 fiscal 2023.
Other business highlights were securing inventory financing for Sprout through an invoice purchase and security agreement partnership. The company amended the previous limit of $5 million to $7.5 million.
Neptune Wellness also extended the maturity of its $13 million promissory note for Sprout from Morgan Stanley to December 31, 2024. The company also announced the closing of a public offering of approximately $4 million.
After the period ended, Neptune entered into a binding term sheet with Morgan Stanley that allows for the conversion of Sprout Orgnics debt into equity. The debt-to-equity conversion would grant Neptune a substantial ownership stake of approximately 89.5% in Sprout Organics.
The Neptune Wellness (NEPT) stock price.
The Neptune Wellness (NEPT) stock price soared 112.63% to trade at $0.2930, rising from Thursday's closing price of $0.1378.
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