ISDR Blueprint iXBRL Document
0001386570 false 0001386570 2020-08-06 2020-08-06




UNITED STATES
 SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________
 
FORM 8-K
 
CURRENT REPORT
     PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 
Date of Report (Date of earliest event reported): August 6, 2020
 
CHROMADEX CORPORATION
 (Exact name of registrant as specified in its charter)
 
Delaware
001-37752
26-2940963
(State or other jurisdiction of incorporation)
(Commission File Number)
(IRS Employer Identification No.)
 
10900 Wilshire Blvd. Suite 600, Los Angeles, California 90024
(Address of principal executive offices, including zip code)
 
(310) 388-6706
 (Registrant's telephone number, including area code)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
 
  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
  
Securities registered pursuant to Section 12(b) of the Act:
 
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, par value $0.001 per share
CDXC
The Nasdaq Capital Market
 
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
 
Emerging growth company 
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 
 




 
Item 2.02. 
Results of Operations and Financial Condition.
 
On August 6, 2020, ChromaDex Corporation (the “Company”) issued a press release announcing its earnings for the quarter ended June 30, 2020. A copy of the press release is attached hereto as Exhibit 99.1.
 
The information in this Item 2.02 and the exhibit hereto are being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.
 
 
Item 7.01. 
Regulation FD Disclosure.
 
On August 6, 2020, the Company released a corporate presentation which it made available on its website. A copy of the corporate presentation is attached hereto as Exhibit 99.2.
 
The information in this Item 7.01 and the exhibit hereto are being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.
 
Item 9.01 Financial Statements and Exhibits.
 
 (d) Exhibits.
 
Exhibit Number







Description







 
 
Press Release dated August 6, 2020
 
Investor Presentation of ChromaDex Corporation
104
 
Cover Page Interactive Data File (embedded within the Inline XBRL document)
 
 
 
 
 



SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
 
 
 
 
 
 
 
 
 
CHROMADEX CORPORATION
 
 
 
Dated: August 6, 2020
 
 
 
 
 
 
 
 
 
 
 
 
By:
 
/s/ Kevin M. Farr                                                        
 
 
 
 
 
 
Name: Kevin M. Farr
 
 
 
 
 
 
Chief Financial Officer
 
 
 
 
 
cdxc_ex991
  Exhibit 99.1
 
CHROMADEX CORPORATION REPORTS SECOND QUARTER 2020 FINANCIAL RESULTS
 
Second Quarter 2020 Highlights vs. Second Quarter 2019
 
Strong growth in net sales to $15.3 million, higher gross margins, and significantly improved marketing efficiency year-over-year.
Tru Niagen net sales of $11.7 million, a 34% increase year-over-year.
Net loss was ($3.7) million or ($0.06) per share, an improvement of $0.08 per share year over year. Adjusted EBITDA excluding total legal expense, a non-GAAP measure, was a profit of $0.5 million, a $2.6 million improvement year-over-year.
Signed 200th material transfer agreement through ChromaDex External Research Program (CERP), which has resulted in 60 published studies to date, including 10 published clinical studies, on Niagen®.
The study for the 200th agreement, announced last month, will assess the impact of Niagen® in COVID-19 animal models in collaboration with the National Institute of Allergy and Infectious Diseases (NIAID), a division of the National Institutes of Health (NIH).
 
LOS ANGELES, August 6, 2020 (BUSINESS WIRE) - ChromaDex Corp. (NASDAQ:CDXC) today reported second quarter 2020 financial results.
 
“We achieved record net sales of $15.3 million in the second quarter while maintaining our focus on the science, announcing our 200th research agreement and tenth published human trial on Niagen®,” says ChromaDex CEO Rob Fried. “Business adjustments at the onset of the pandemic and continued marketing efficiencies allowed us to reach a financial goal of positive Adjusted EBITDA excluding total legal expenses.”
 
 Results of operations for the three months ended June 30, 2020
 
For the three months ended June 30, 2020 (“Q2 2020”), ChromaDex reported net sales of $15.3 million, up 38% compared to $11.1 million in the second quarter of 2019 ("Q2 2019"). The increase in Q2 2020 revenues was driven by growth in sales of Tru Niagen and Niagen ingredient revenues.
 
Gross margin increased by 310 basis points to 59.4% in Q2 2020 compared to 56.3% in Q2 2019. The increase in gross margin was largely driven by the positive impact of increased Tru Niagen consumer product sales and product cost saving initiatives, including a benefit of approximately 110 basis points related to savings from prior year initiatives that were recognized in Q2 2020.
 
Operating expenses decreased by $0.7 million to $12.8 million in Q2 2020, compared to $13.4 million in Q2 2019. The decrease in operating expenses was driven by a decrease of $1.1 million in general and administrative expense, and a decrease of $0.1 million of research and development expense, partially offset by $0.7 million of higher selling and marketing expense. The decrease in general and administrative expense was driven by $1.1 million of lower legal expenses.
 
The net loss for Q2 2020 was ($3.7) million or ($0.06) per share compared to a net loss of ($7.8) million or ($0.14) per share for Q2 2019.
 
 
 
 
Adjusted EBITDA excluding total legal expense, a non-GAAP measure, was a profit of $0.5 million for Q2 2020, compared to a loss of ($2.1) million for Q2 2020, a $2.6 million improvement.
 
ChromaDex defines Adjusted EBITDA excluding total legal expense as net income or (loss) which is adjusted for interest, income tax, depreciation, amortization, non-cash stock compensation costs, severance and restructuring expense, bad debt expense related to Elysium Health and total legal expense.
 
For Q2 2020, the net cash used in operating activities was ($1.6) million versus ($9.0) million in Q2 2019.
 
2020 Outlook
 
Looking forward, the impact of COVID-19 on revenues is difficult to predict and the Company is managing expenses to mitigate the bottom-line impact. The Company does not expect any supply chain disruption at this time and, based on trends-to-date, expects continued revenue growth this year. Based on the Company’s current financial outlook, revenue growth will be driven by its U.S. ecommerce business, new international market launches with its partners and distributors, such as in the U.K. and Australia, new online platforms, including Persona Nutrition, a Nestlé Health Science company, and the Company’s new product, Tru Niagen® Beauty.  The Company expects continued gross margin improvement driven by a higher mix of Tru Niagen® sales, product design changes implemented in late 2019, and additional supply chain cost savings initiatives in 2020. The Company expects lower selling, marketing and advertising as well as general and administrative expenses as a percentage of net sales driven by strong growth from returning customers and scale on our fixed overhead costs driven by organizational realignment initiatives, as well as new systems and processes.
 
Investor Conference Call
 
ChromaDex management will host an investor conference call to discuss the first quarter results and provide a general business update on Thursday, August 6, at 4:30pm ET.
 
Participants should call in at least 10 minutes prior to the call. The dial-in information is as follows:
 
Date: Thurs., August 6, 2020
Time: 4:30 p.m. Eastern time (1:30 p.m. Pacific time) 
Toll-free dial-in number: (833) 979-2703  
International dial-in number: (236) 714-2223
Conference ID: 1563949
Webcast link: ChromaDex Second Quarter 2020 Earnings Conference Call
 
The conference call will be broadcast live and available for replay here and via the investor relations section of the Company’s website at www.chromadex.com.
 
A replay of the conference call will be available after 7:30 p.m. ET.
Toll-free replay number: 800-585-8367
Replay ID: 1563949
 
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:
 
Adjusted EBITDA excluding total legal expense excludes interest, income tax, depreciation, amortization, non-cash share-based compensation costs, severance and restructuring expense, bad debt expense related to Elysium Health, and total legal expense. ChromaDex used these non-GAAP measures when evaluating its financial results as well as for internal resource management, planning and forecasting purposes. ChromaDex believes the presentation of its non-GAAP financial measures enhances the overall understanding of the company’s historical financial performance. These non-GAAP measures should not be viewed in isolation from or as a substitute for ChromaDex’s financial results in accordance with GAAP. Reconciliation of GAAP to non-GAAP measures are attached to this press release.
 
About ChromaDex:
 
ChromaDex Corp. is a science-based integrated nutraceutical company devoted to improving the way people age. ChromaDex scientists partner with leading universities and research institutions worldwide to discover, develop and create solutions to deliver the full potential of NAD and its impact on human health. 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®. ChromaDex maintains a website at www.chromadex.com to which ChromaDex regularly posts copies of its press releases as well as additional and financial information about the Company.
 
Important Note on Forward Looking Statements:
 
This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended. 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 the quotation from ChromaDex’s Chief Executive Officer, and statements related to the impact of COVID-19 on revenues and supply chain and ChromaDex’s management of expenses to mitigate the bottom-line impact; future revenue growth being driven by ChromaDex’s U.S. ecommerce business, new international markets and online platforms, including Persona Nutrition, and new product, Tru Niagen Beauty; the expectations of gross margin improvement driven by a by a higher mix of Tru Niagen® sales, product design changes implemented in late 2019, and additional supply chain cost savings initiatives in 2020; and the expectations of lower selling, marketing and advertising expenses and lower general and administrative expenses as a percentage of net sales driven by strong growth from returning customers and scale on fixed overhead costs driven by organizational realignment initiatives, as well as new systems and processes. Other risks that contribute to the uncertain nature of the forward-looking statements are reported in our most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-K, as amended, as filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and actual results may differ materially from those suggested by these forward-looking statements. All forward-looking statements are qualified in their entirety by this cautionary statement and ChromaDex undertakes no obligation to revise or update this release to reflect events or circumstances after the date hereof.
 
ChromaDex Investor Relations Contact:
 
Brianna Gerber, Vice President of FP&A and Investor Relations
949-419-0288 ext. 127
briannag@chromadex.com
 
ChromaDex Media Contact:
 
Alex Worsham, Senior Director of Global Corporate Communications
310-388-6706 ext. 689
alexw@chromadex.com
ChromaDex Corporation
 
 
 
 
ChromaDex Corporation and Subsidiaries
 
Condensed Consolidated Statements of Operations
For the Three Month Periods Ended June 30, 2020 and June 30, 2019
(In thousands, except per share data)
 
 
 
Three Months Ended
 
 
 
June 30,
2020
 
 
June 30,
2019
 
 
 
 
 
 
 
 
Sales, net
 $15,287 
 $11,101 
Cost of sales
  6,199 
  4,847 
 
    
    
Gross profit
  9,088 
  6,254 
 
    
    
Operating expenses:
    
    
Sales and marketing
  4,959 
  4,308 
Research and development
  942 
  1,069 
General and administrative
  6,874 
  7,932 
Other
  - 
  125 
Operating expenses
  12,775 
  13,434 
 
    
    
Operating loss
  (3,687)
  (7,180)
 
    
    
Nonoperating expense:
    
    
Interest expense, net
  (24)
  (575)
Nonoperating expense
  (24)
  (575)
 
    
    
Net loss
 $(3,711)
 $(7,755)
 
    
    
Basic and diluted loss per common share
 $(0.06)
 $(0.14)
 
    
    
Basic and diluted weighted average
    
    
    common shares outstanding
  60,906 
  55,539 
 
    
    
 
See Notes to Consolidated Financial Statements in Part I of ChromaDex's Quarterly Report
on Form 10-Q filed with Securities and Exchange Commission on August 6, 2020.
 
 
 
 
ChromaDex Corporation and Subsidiaries
 
Condensed Consolidated Balance Sheets
June 30, 2020 and December 31, 2019
(In thousands, except per share data)
 
 
 
Jun. 30,
2020
 
 
Dec. 31,
2019
 
Assets
 
 
 
 
 
 
 
 
 
 
 
 
 
Current Assets
 
 
 
 
 
 
Cash, including restricted cash of $0.2 million and $0.2 million, respectively
 $18,890 
 $18,812 
Trade receivables, net of allowances of $0.0 million and $2.8 million, respectively;
    
    
   Receivables from Related Party: $1.1 million and $0.8 million, respectively
  3,954 
  2,175 
Inventories
  12,338 
  11,535 
Prepaid expenses and other assets
  584 
  996 
Total current assets
  35,766 
  33,518 
 
    
    
Leasehold Improvements and Equipment, net
  3,487 
  3,765 
Intangible Assets, net
  1,189 
  1,311 
Right of Use Assets
  705 
  891 
Other Long-term Assets
  845 
  762 
 
    
    
Total assets
 $41,992 
 $40,247 
 
    
    
Liabilities and Stockholders' Equity
    
    
 
    
    
Current Liabilities
    
    
Accounts payable
 $9,780 
 $9,626 
Accrued expenses
  5,246 
  4,415 
Current maturities of operating lease obligations
  632 
  595 
Current maturities of finance lease obligations
  134 
  258 
Customer deposits
  250 
  169 
Total current liabilities
  16,042 
  15,063 
 
    
    
Deferred Revenue
  3,820 
  3,873 
Operating Lease Obligations, Less Current Maturities
  522 
  848 
Finance Lease Obligations, Less Current Maturities
  27 
  18 
 
    
    
Total liabilities
  20,411 
  19,802 
 
    
    
Commitments and Contingencies
    
    
 
    
    
Stockholders' Equity
    
    
Common stock, $.001 par value; authorized 150,000 shares;
    
    
   issued and outstanding June 30, 2020 61,421 shares and
    
    
   December 31, 2019 59,562 shares
  61 
  60 
Additional paid-in capital
  153,036 
  142,285 
Accumulated deficit
  (131,513)
  (121,900)
Cumulative translation adjustments
  (3)
  - 
Total stockholders' equity
  21,581 
  20,445 
 
    
    
Total liabilities and stockholders' equity
 $41,992 
 $40,247 
 
    
    
 
See Notes to Consolidated Financial Statements in Part I of ChromaDex's Quarterly Report
on Form 10-Q filed with Securities and Exchange Commission on August 6, 2020.
  
 
 
 
ChromaDex Corporation and Subsidiaries
Reconciliation of Non-GAAP Financial Measures
  
Adjusted EBITDA
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Q1 2019
 
 
Q2 2019
 
 
Q3 2019
 
 
Q4 2019
 
 
Q1 2020
 
 
Q2 2020
 
(In thousands)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net loss, as reported
 $(8,337)
 $(7,755)
 $(7,202)
 $(8,853)
 $(5,902)
 $(3,711)
   Adjustments:
    
    
    
    
    
    
     Interest (income) expense
  (35)
  575 
  314 
  (7)
  12 
  24 
     Depreciation
  173 
  190 
  196 
  203 
  214 
  218 
     Amortization of intangibles
  61 
  61 
  62 
  62 
  62 
  60 
     Amortization of right of use assets
  138 
  141 
  144 
  92 
  92 
  95 
     Share-based compensation
  2,029 
  1,759 
  1,687 
  1,697 
  1,873 
  1,711 
     Severance and restructuring
  - 
  - 
  - 
  200 
  953 
  284 
     Elysium-related bad debt expense
  - 
  - 
  - 
  2,233 
  - 
  - 
Adjusted EBITDA
 $(5,971)
 $(5,029)
 $(4,799)
 $(4,373)
 $(2,696)
 $(1,319)
 
    
    
    
    
    
    
     Total legal expense
  3,250 
  2,926 
  2,944 
  2,226 
  2,380 
  1,844 
 
    
    
    
    
    
    
Adjusted EBITDA excluding total legal expense
 $(2,721)
 $(2,103)
 $(1,855)
 $(2,147)
 $(316)
 $525 
 
 
 
cdxc_ex992
 Exhibit 99.2
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
v3.20.2
Document and Entity Information
Aug. 06, 2020
Document and Entity Information [Abstract]  
Entity Central Index Key 0001386570
Amendment Flag false
Document Type 8-K
Document Period End Date Aug. 06, 2020
Entity Registrant Name CHROMADEX CORPORATION
Entity Incorporation, State or Country Code DE
Entity File Number 001-37752
Entity Tax Identification Number 26-2940963
Entity Address, Address Line One 10900 Wilshire Blvd
Entity Address, Address Line Two Suite 600
Entity Address, City or Town Los Angeles
Entity Address, State or Province CA
Entity Address, Postal Zip Code 90024
City Area Code (310)
Local Phone Number 388-6706
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, par value $0.001 per share
Trading Symbol CDXC
Security Exchange Name NASDAQ
Entity Emerging Growth Company false