Full Press Release Details
Pharmaceuticals Reports First Quarter FY 2019 Financial Results
Total Revenue up 20% over March 2018 Quarter
Total Revenue up 14% over June 2017 Quarter
Call Begins at 4:30pm EDT Today
PETALUMA, CA-(August 8, 2018) -Sonoma Pharmaceuticals,
Inc. (Nasdaq: SNOA), today announced financial results for the first quarter FY 2019 ended June 30, 2018. Total revenue of $4.4
million for the first quarter ended June 30, 2018, was up 14% when compared to $3.8 million for the same period last year. Product
revenues of $4.1 million for the first quarter ended June 30, 2018, was up 14%, or $492,000, when compared to the same period last
year, with increases in the U.S. and Latin American revenue.
"We're pleased by our company's first quarter
revenue growth and are excited to see the initial success behind our recently launched mail-order prescription delivery
program," says Jim Schutz, Sonoma Pharmaceuticals CEO. "We have a good track record of
engaging doctors to support our differentiated patient solutions in the dermatology market. We believe our new
mail-order, direct-to-patient initiative will help to address the challenges with insurance coverage and the use of rebates
and will also enable us to better serve our patients. We were encouraged to see the percent of
prescriptions directed to and fulfilled by this program increase throughout the first quarter FY2019.
Also, in the quarter, we expanded our addressable markets as the result of new FDA approvals for
our dermatology and eye care product lines and additional market approvals and partnerships for our products
Business Highlights:
- Received U.S. FDA clearance for post-laser therapy
gel enabling entry into lucrative cosmetic markets.
- Received FDA clearances to add antimicrobial language
to key dermatology and eye care products.
- Relaunched Acuicyn eye care
solution with next-gen formulation, antimicrobial name and enhanced packaging to more aggressively compete in
- Launched direct-to-patient mail order program accounting
for 20% of dermatology units shipped in month of June.
- Signed a license and supply agreement in June 2018
with the largest pharmaceutical company in Brazil, NC Group/U.SK, to commercialize seven HOCl products.
- Received approval from United Arab Emirates
(UAE) Ministry of Health & Prevention for seven products addressing the following indications; daily eyelid hygiene,
antimicrobial nasal cleaning, antiseptic mouth and throat rinse, acne and several anti-fungal indications.
Results for the Three Months Ended June 30, 2018
Product revenues in the United States of
$2 million for the three months ended June 30, 2018, increased by $112,000, or 6%, as compared to
$1.9 million for the three months ended June 30, 2017. This increase was mostly the result of higher sales of
the company's dermatology and animal health care products, partly offset by a decrease in sales of our acute care
products. While the gross dermatology revenue showed strong growth, the amount of the rebate costs and the growth in
units sold were still impacted by the reset of the health care plans in January and the growth of high deductible health
Product revenue in Latin America for the quarter ended June
30, 2018, was $1.1 million, up 90% from the same period last year. This amount reflects the high growth in the sale
of products to Invekra and the sale of products into the Latin America market, following the completion
of Sonoma's asset sale to Invekra in October 2016. Sonoma will continue to supply products to Invekra until its manufacturing
facility is operational.
Product revenue in Europe and the rest of
the world of $1 million, for the first quarter ended June 30, 2018, decreased by $130,000, or 11%, as compared to
$1.2 million for the three months ended June 30, 2017. This decrease was the result of lower sales
in the Middle East and Singapore, partly offset by higher sales in China,
Korea, Australia, New Zealand and India.
Gross profit for the quarter ended June 30, 2018,
was $1.7 million, or 40% of total revenue, compared to a gross profit of $1.8 million, or 46% of total
revenue in the same period in the prior year. The decrease in gross profit, as a percentage of revenue, was
primarily due to the change in the mix as a result of higher sales in Latin America
to Invekra at a low profit margin.
Operating expenses minus non-cash expenses during
the first quarter of fiscal year 2019 were $4.9 million, up $206,000 or 4%, as compared to the
same period in the prior year. This increase in operating expenses was mostly due to
higher marketing and legal expenses in the United States, partly offset by a decline in Latin
Loss from operations was $3.5 million, down
$50,000, compared to $3.5 million for the same period last year. Operating loss less non-cash expenses (EBITDA) for
the three months ended June 30, 2018, was $3.1 million, compared to $2.8 million for the same period last year.
As of June 30, 2018, Sonoma had cash and cash
equivalents of $7.7 million, as compared to $10.1 million as of March 31, 2018.
Sonoma's management will hold a conference call today
to discuss first quarter fiscal year 2019 results and answer questions beginning at 4:30 p.m. EDT. Individuals interested in participating
in the conference call may do so by dialing 877-303-7607 for domestic callers or 973-638-3203 for international callers. Those
interested in listening to the conference call live via the Internet may do so at https://edge.media-server.com/m6/p/b5tvh3bj.
Please log on approximately 10 minutes prior to the presentation in order to register and download the appropriate
software, if any. Also, participants can download a graphical presentation of the quarterly results at this same site, which provides
greater granular detail in conjunction with the call.
replay will be available for seven days following the conclusion of the call by dialing 855-859-2056 for domestic callers, or 404-537-3406
for international callers, and entering conference code 1292509. A webcast replay will be available on the site at http://ir.sonomapharma.com/events.cfm
for one year following the call.
About Sonoma Pharmaceuticals, Inc.
Sonoma is a specialty pharmaceutical company that develops and
markets unique and effective solutions for the treatment of dermatological conditions and advanced tissue care. The company's
products, which are sold throughout the United States and internationally, have improved outcomes for more than five million
patients globally by reducing infections, itch, pain, scarring and harmful inflammatory responses. The company's headquarters
are in Petaluma, California, with manufacturing operations in the United States and Latin America. European marketing and
sales are headquartered in Roermond, Netherlands. More information can be found at www.sonomapharma.com.
Forward-Looking Statements
Except for historical information herein, matters set
forth in this press release are forward-looking within the meaning of the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995, including statements about the commercial and technology progress and
future financial performance of Sonoma Pharmaceuticals, Inc. and its subsidiaries (the "Company"). These
forward-looking statements are identified by the use of words such as "provide," "entry," and
"commercialize," among others. Forward-looking statements in this press release are subject to certain risks and
uncertainties inherent in the Company's business that could cause actual results to vary,
including such risks that regulatory clinical and guideline developments may change, scientific data may
not be sufficient to meet regulatory standards or receipt of required regulatory clearances or approvals, clinical results
may not be replicated in actual patient settings, protection offered by the Company's patents and patent
applications may be challenged, invalidated or circumvented by its competitors, the available market
for the Company's products will not be as large as expected, the Company's products will not
be able to penetrate one or more targeted markets, revenues will not be sufficient to meet the Company's cash
needs, fund further development and clinical studies, as well as uncertainties relative to varying product formulations and a
multitude of diverse regulatory and marketing requirements in different countries and municipalities, and other risks
detailed from time to time in the Company's filings with the Securities and Exchange Commission. The Company disclaims
any obligation to update these forward-looking statements, except as required by law.
Sonoma Pharmaceuticals is a trademark or registered trademark
of Sonoma Pharmaceuticals, Inc. All other trademarks and service marks are the property of their respective owners.