Synergy CHC Corp Reports Growth in Earnings Per Share for its First Quarter 2025 Financial Results and its Ninth Consecutive Quarter of Profitability
WESTBROOK, Maine, May 15, 2025 (GLOBE NEWSWIRE) -- Synergy CHC Corp. (NASDAQ: SNYR) ("Synergy" or the "Company"), a provider of consumer health care and lifestyle products, is announcing its financial results for the three months ended March 31, 2025.
"We are very pleased to report 30% growth in earnings per share year-over-year, marking our ninth consecutive quarter of profitability," said Jack Ross, CEO of Synergy. "Additionally, we expanded our EBITDA margins significantly to 24.1% compared to 19.7% in the prior year period. This performance highlights the strength of our operating model and our ongoing discipline around cost management."
"We continue to make meaningful progress toward our 2025 priorities, including preparing for international expansion into three new markets later this year for our FOCUSfactor brand and Ready-To-Drink beverages, and expanding our Flat Tummy product line in response to rising interest in GLP-1 support. We also successfully entered into term sheets to refinance our debt that we expect to close as expeditiously as possible, which is expected to accelerate free cash flow in the business in the near term and extend our debt maturity date into 2029. This will provide us the added flexibility to pursue our long-term strategic goals and accelerate our 2025 growth initiatives. With continued momentum and the expected refinancing, Synergy has a clear path forward. We remain confident in our ability to drive sustainable growth and shareholder value. We are truly excited about our ability to accelerate our growth initiatives in the coming quarters."
First Quarter 2025 Financial Summary vs. Same Year-Ago Period
-- Revenue of $8.2 million vs. $9.4 million.
-- Gross margin of 75.4% vs. 72.0%.
-- Income from operations of $1.9 million vs. $1.8 million.
-- Net income of $876.3 thousand vs. $580.5 thousand.
-- Earnings per share of $0.10 vs. $0.08.
-- EBITDA, a non-GAAP financial measure, was $1.98 million vs. $1.85
million.
Recent Business Highlights
-- Synergy entered and continued debt refinancing negotiations during and
after the first quarter, aiming to extend the maturity to 2029.
-- Synergy has established a wholly owned subsidiary in Mexico and is
actively working to onboard several key suppliers and retailers in the
region.
-- Synergy signed a new long-term supplier agreement for FOCUSfactor
products, effective April 2025, which is expected to deliver significant
cost savings.
-- During the first quarter, the Company reduced outstanding liabilities by
$1.7 million.
First Quarter 2025 Financial Results
Revenue in the first quarter of 2025 was $8.2 million, down 13% compared to $9.4 million in the first quarter of 2024. The decrease was driven by a new product sell-in to one customer in 2024, that did not repeat in 2025.
Gross margin in the first quarter of 2025 was 75.4% compared to 72.0% in the first quarter of 2024. The increase was largely driven by a favorable shift in product mix.
Operating expenses in the first quarter of 2025 were $4.2 million, down 15% compared to $5.0 million in the first quarter of 2024. The improvement was driven by management of operating costs and the decrease in net revenue.
Income from operations for the first quarter of 2025 was $1.9 million, up 8% compared to $1.8 million in the first quarter of 2024. The increase in operating income was due to a decrease in operating expenses.
Net income in the first quarter of 2025 was $876.3 thousand, up 51% compared to net income of $580.5 thousand in the first quarter of 2024.
EBITDA (a non-GAAP financial measure) in the first quarter of 2025 was $1.98 million, up 7% compared to $1.85 million in the first quarter of 2024. The increase was primarily due to lower SG&A expenses.
Balance Sheet and Cash Flow
As of March 31, 2025, Synergy had approximately $177.9 thousand in cash and cash equivalents, compared to $687.9 thousand in cash and cash equivalents as of December 31, 2024. As of March 31, 2025, Synergy had $31.3 million in total liabilities, compared to $33.0 million in total liabilities as of December 31, 2024, an improvement of $1.7 million.
As of March 31, 2025, Synergy had $2.3 million in inventory, compared to $1.7 million in inventory as of December 31, 2024.
Cash used in operating activities for the three months ended March 31, 2025 was $822.8 thousand compared to cash used in operating activities of $858 thousand for the three months ended March 31, 2024.
EBITDA
Along with this information, to assist financial statement users in an assessment of our historical performance, the Company discloses non-GAAP financial measures in press releases and on investor conference calls and related events, as the Company believes that the non-GAAP information enhances investors' overall understanding of our financial performance, and should be read in addition to, rather than instead of, the financial statements prepared in accordance with GAAP.
The following table reconciles net income to EBITDA (in millions of US dollars):
3 Months ended March 31
2025 2024
------------ -----------
Net income for the period $ 0.88 $ 0.58
------------------------------------ ------------ -----------
Adjusted for:
------------------------------------ ------------ -----------
Interest expense, net 1.08 1.11
------------------------------------ ------------ -----------
Amortization of intangible assets 0.03 0.03
------------------------------------ ------------ -----------
Taxes expense (benefit) (0.01) 0.13
------------------------------------ ------------ -----------
EBITDA $1.98 $1.85
------------------------------------ ------------ -----------
Conference Call
In conjunction with this announcement, Synergy will host a conference call at 9:00 a.m. ET / 6:00 a.m. PT on May 15, 2025 with the Company's Chief Executive Officer, Jack Ross, and the Company's Chief Financial Officer, Jaime Fickett. A live webcast of the call will be available on the Investor Relations section of Synergy's website. To access the call by phone, please register here and you will be provided with dial in details. To avoid delays, we encourage participants to dial into the conference call 15 minutes ahead of the scheduled start time. A replay of the webcast will also be available for a limited time on the Company's website.
About Synergy CHC Corp.
Synergy CHC Corp. is a provider of consumer health care and lifestyle products. Synergy's current brand portfolio consists of two marquee brands, FOCUSfactor, a clinically-tested brain health supplement that has been shown to improve memory, concentration and focus, and Flat Tummy, a lifestyle and wellness brand that provides a suite of nutritional products to help women achieve their weight management goals.
Forward Looking Statements
Certain statements contained in this press release constitute "forward-looking statements," including statements regarding expansion and growth initiatives, refinancing of our indebtedness and our free cash flow. These forward-looking statements represent Synergy's expectations or beliefs concerning future events, and it is possible that the results described in this press release will not be achieved. These forward-looking statements are subject to risks, uncertainties and other factors, which are set forth in Synergy's registration statement on Form S-1, as amended, many of which are outside of Synergy's control, that could cause actual results to differ materially from the results discussed in the forward-looking statements.
Any forward-looking statement speaks only as of the date on which it is made, and, except as required by law, Synergy does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. New factors emerge from time to time, and it is not possible for Synergy to predict all such factors. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements in Synergy's filings with the SEC. The risk factors and other factors noted in Synergy's filings could cause its actual results to differ materially from those contained in any forward-looking statement.
Investor Relations
Gateway Group
Cody Slach
949.574.3860
SNYR@gateway-grp.com
Synergy CHC Corp.
Condensed Consolidated Balance Sheets
March 31, December 31,
2025 2024
------------ ------------
(unaudited)
Assets
Current Assets
Cash and cash equivalents $ 177,882 $ 687,920
Restricted cash 100,000 100,000
Accounts receivable, net 4,380,518 5,321,037
Other receivables 1,855,000 1,999,637
Loan receivable (related party) 4,375,892 4,375,059
Prepaid expenses (including related
party amount of $508,879 and
$312,966, respectively) 2,170,263 1,859,563
Inventory, net 2,346,487 1,716,552
----------- -----------
Total Current Assets 15,406,042 16,059,768
----------- -----------
Intangible assets, net 250,000 283,333
Total Assets $ 15,656,042 $ 16,343,101
=========== ===========
Liabilities and Stockholders'
Deficit
Current Liabilities:
Accounts payable and accrued
liabilities (including related
party payable of $217,956 and
$88,644, respectively) $ 3,098,590 $ 5,191,868
Income taxes payable 77,564 242,977
Contract liabilities 36 24,252
Short term loans payable, net of
debt discount 4,754,555 7,725,272
Current portion of long-term notes
payable, net of debt discount and
debt issuance cost, related party 135,000 4,000,000
----------- -----------
Total Current Liabilities 8,065,745 17,184,369
----------- -----------
Long-term Liabilities:
Notes payable, net of debt
discount, related parties 12,333,053 8,333,053
Notes payable 10,896,610 7,457,022
----------- -----------
Total long-term liabilities 23,229,663 15,790,075
----------- -----------
Total Liabilities 31,295,408 32,974,444
----------- -----------
Commitments and contingencies
Stockholders' Deficit:
Common stock, $0.00001 par value;
300,000,000 shares authorized;
8,752,178 and 8,721,818, shares
issued, respectively; 8,572,105
and 8,541,745 outstanding,
respectively 88 87
Additional paid in capital 27,761,307 27,643,660
Accumulated other comprehensive
loss (49,712) (47,777)
Accumulated deficit (43,223,549) (44,099,813)
Less: Treasury stock (180,073
shares) at cost (127,500) (127,500)
----------- -----------
Total stockholders' deficit (15,639,366) (16,631,343)
----------- -----------
Total Liabilities and Stockholders'
Deficit $ 15,656,042 $ 16,343,101
=========== ===========
Synergy CHC Corp.
Unaudited Condensed Consolidated Statements of Income
and Comprehensive Income
For the three
For the three months ended months ended
March 31, March 31,
2025 2024
---------------------------- ---------------
Revenue
Product Sales 6,670,534 $ 9,411,863
License Revenue 1,500,000 -
--- ----------------------- -----------
Total Revenue 8,170,534 9,411,863
Cost of Sales 2,006,513 2,637,139
--- ----------------------- -----------
Gross Profit 6,164,021 6,774,724
Operating expenses
Selling and marketing 2,876,271 3,584,677
General and
administrative 1,306,714 1,348,385
Depreciation and
amortization 33,333 33,333
--- ----------------------- -----------
Total operating
expenses 4,216,318 4,966,395
--- ----------------------- -----------
Income from operations 1,947,703 1,808,329
Other (income) expenses
Interest income (13,882) (387)
Interest expense 1,095,369 1,109,980
Remeasurement loss
(gain) on translation
of foreign subsidiary 1,412 (8,983)
Total other expenses 1,082,899 1,100,610
--- ----------------------- -----------
Net income before
income taxes 864,804 707,719
Income tax benefit
(expense) 11,460 (127,189)
Net income after tax $ 876,264 $ 580,530
--- ----------------------- -----------
Net income per share --
basic $ 0.10 $ 0.08
--- ----------------------- -----------
Net income per share --
diluted $ 0.10 $ 0.08
--- ----------------------- -----------
Weighted average common
shares outstanding
Basic 8,560,636 7,373,745
Diluted 8,577,620 7,373,745
Comprehensive income:
Net income $ 876,264 $ 580,530
Foreign currency
translation
adjustment (1,935) 131,637
Comprehensive income $ 874,329 $ 712,167
Synergy CHC Corp.
Unaudited Condensed Consolidated Statements of Cash
Flows
For the three
months ended For the three months ended
March 31, March 31,
2025 2024
--------------- ----------------------------
Cash Flows from
Operating Activities
Net income $ 876,264 $ 580,530
Adjustments to
reconcile net income to
net cash used in
operating activities:
Amortization of debt
discount and debt
issuance cost 406,841 -
Depreciation and
amortization 33,333 33,334
Foreign currency
transaction loss
(gain) (3,137) 11,178
Remeasurement gain on
translation of foreign
subsidiary (1,412) (8,983)
Non cash implied
interest - 7,199
Changes in operating
assets and
liabilities:
Accounts receivable 940,519 (318,330)
Other receivables 144,637 -
Loan receivable,
related party (833) 25,162
Inventory (629,935) 1,016,455
Prepaid expenses (114,787) (202,888)
Prepaid expense,
related party (195,913) (165,687)
Income taxes payable (165,413) (20,315)
Contract liabilities (24,216) 12,932
Accounts payable and
accrued liabilities (2,218,041) (1,808,989)
Accounts payable,
related party 129,312 (19,640)
----------- --- -----------------------
Net cash used in
operating activities (822,781) (858,042)
Cash Flows from
Investing Activities - -
Cash Flows from
Financing Activities
Advances from related
party 135,000 1,400,000
Repayment of notes
payable, related
party - (84,500)
Proceeds from notes
payable 1,496,250 125,000
Repayment of notes
payable (1,316,572) (435,880)
----------- --- -----------------------
Net cash provided by
financing activities 314,678 1,004,620
Effect of exchange rate
on cash, cash
equivalents and
restricted cash (1,935) 131,637
Net decrease in cash,
cash equivalents and
restricted cash (510,038) 278,215
Cash and restricted
cash, beginning of
year 787,920 732,534
----------- --- -----------------------
Cash and restricted
cash, end of period $ 277,882 $ 1,010,749
----------- --- -----------------------
Supplemental Disclosure
of Cash Flow
Information:
Cash paid during the
period for:
Interest $ 573,529 $ 1,102,781
----------- --- -----------------------
Income taxes $ - $ 147,728
----------- --- -----------------------
Supplemental Disclosure
of Noncash Investing
and Financing
Activities:
Accounts payable
converted to loan
payable upon
settlement $ - $ 3,770,824
----------- --- -----------------------
Issuance of common
stock for loan
financing $ 117,648 $ -
----------- --- ---------------
(MORE TO FOLLOW) Dow Jones Newswires
May 15, 2025 08:00 ET (12:00 GMT)
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.