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NEXGEL Reports Record Fourth Quarter and Full Year 2024 Financial Results

1. NXGL's Q4 revenue surged 181% year-over-year to $3.04 million. 2. Full year 2024 revenue reached $8.69 million, a 112% increase. 3. Guidance for 2025 expects revenue of $13 million and positive EBITDA. 4. NEXGEL's portfolio expansion includes successful acquisition of Silly George. 5. First shipments of SilverSeal® to Cintas initiated in Q4 2024.

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Why Bullish?

NEXGEL has shown consistent revenue growth, attracting investor interest. Positive EBITDA guidance signals potential profitability, recalling past stock performance during similar revenue surges.

How important is it?

The strong revenue growth and future guidance are compelling indicators of NXGL's potential; these factors are crucial for investor sentiment and decision-making.

Why Short Term?

Short-term impact is expected as earnings reports typically influence immediate stock price movements, especially after such substantial growth.

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Fourth quarter 2024 revenue totaled $3.04 million, an increase of 181%, as compared to $1.08 million for the same period the prior year Full year 2024 revenue totaled $8.69 million, an increase of 112%, as compared to $4.09 million in 2023 Over 100% full year and fourth quarter revenue growth year-over-year for third consecutive year Company issues revenue guidance of $13 million for 2025 and expects to achieve positive EBITDA during the year LANGHORNE, Pa., March 24, 2025 (GLOBE NEWSWIRE) -- NEXGEL, Inc. (“NEXGEL” or the “Company”) (NASDAQ: “NXGL”), a leading provider of ultra-gentle, high-water-content hydrogel products for healthcare and consumer applications, today announced record fourth quarter and full year financial results for the period ending December 31, 2024. Fourth Quarter 2024 Financial Highlights: Net Revenue was $3.04 million, compared to $1.08 million in Q4 2023 and $2.94 million in Q3 2024.Gross Profit was $1.13 million, compared to $0.09 million in Q4 2023 and $1.28 million in Q3 2024.Gross Profit Margin was 37.2%, compared to 8.7% in Q4 2023 and 43.6% in Q3 2024.Net loss for Q4 2024was $0.85 million, compared to $1.10 million in Q4 2023 and $0.69 million in Q3 2024. Q4 2024 includes a non-recurring one-time inventory write off of $0.24 million.EBITDA1, a non-GAAP financial measure, was ($0.73) million in Q4 2024, compared to EBITDA of ($0.97) million in Q4 2023 and an EBITDA of ($0.49) million in Q3 2024.Adjusted EBITDA1, a non-GAAP financial measure, was ($0.62) million in Q4 2024, compared to Adjusted EBITDA of ($0.88) million in Q4 2023 and Adjusted EBITDA of ($0.35) million in Q3 2024. Full Year 2024 Financial Highlights: Net Revenue was $8.69 million, compared to $4.09 million in 2023.Gross Profit was $2.75 million, compared to $0.37 million in 2023.Gross Profit Margin was 31.6%, compared to 9.2% in 2023.Net loss was $3.28 million, compared to $3.16 million in 2023.EBITDA1, a non-GAAP financial measure, was ($2.76) million, compared to EBITDA of ($2.92) million in 2023.Adjusted EBITDA1 loss, a non-GAAP financial measure, was ($2.43) million, compared to EBITDA ($2.80) million in 2023.Cash as of December 31, 2024, was $1.81 million. “The fourth quarter and full year 2024 were record periods for NEXGEL across all our key financial measures. We successfully grew full year and fourth quarter revenue over 100% year-over-year for the third consecutive year Our EBITDA loss continued to narrow when compared to Q4 2023. Our growth and operational efficiency were driven by consistent performance each quarter in both branded consumer products and contract manufacturing,” Adam Levy, NEXGEL’s Chief Executive Officer, commented. “During the fourth quarter we made our first shipments of SilverSeal® to Cintas, which continues into the first quarter of 2025. Our consumer products across our entire portfolio of brands including Medagel, Silly George®, Kenkoderm®, and Histasolv, in partnership with STADA, all performed well. In an ongoing effort to optimize our brand portfolio, we are leveraging our marketing capabilities, while also launching new product offerings for our loyal customers.” Mr. Levy continued, “As we look into the first quarter 2025, which is seasonally our weakest of the year, we expect revenue to be at least $2.75 million. We also expect to generate at least $13 million in revenue for 2025 and achieve positive EBITDA during the year. Our pipeline of potential new customers in 2025 remains healthy and robust.” 2024 Operating Highlights: Revenue growth of over 100% year-over-year for third consecutive year.Acquired international beauty brand, Silly George, and successfully grew sales from an initial $2 million annual revenue run rate to over $5.0 million and growing.Announced supply agreement with Cintas for SilverSeal®, which began generating revenue during the fourth quarter of 2024.Partnered with STADA to launch leading European DAO enzyme supplement, Histasolv, in North America, which began generating revenue during the fourth quarter of 2024.Initiated institutional review board study with Innovative Optics US in accordance with FDA for hydrogel application during laser hair removal with expected data soon. Fourth Quarter and Full Year 2024 Financial ResultsFor the fourth quarter of 2024, revenue totaled $3.04 million, an increase of 181%, as compared to $1.08 million for the fourth quarter 2023. Revenue for the full year 2024 totaled $8.69 million, an increase of 112%, as compared to $4.09 million in 2023. The increase year-over-year in overall revenue during both periods was primarily due to sales growth in branded consumer products and contract manufacturing. Cost of revenues totaled $1.91 million for the fourth quarter 2024, as compared to $0.99 million for the fourth quarter 2023. Cost of revenues in 2024 totaled $5.94 million, as compared to $3.72 million in 2023. The increase in cost of revenues is primarily aligned with sales of branded consumer products, as both Silly George and Kenkoderm were acquired after the comparable 2023 period. Gross profit totaled $1.13 million for the fourth quarter of 2024, as compared to a gross profit of $0.09 million for the fourth quarter of 2023. Gross profit margin for the fourth quarter 2024 was 37.2%, as compared to 8.7% for the fourth quarter 2023. Gross profit for 2024 totaled $2.75 million, as compared to $0.37 million in 2023. Gross profit margin for 2024 was 31.6%, as compared to 9.2% in 2023. The increase of $2.38 million in 2024 was primarily due to an increase in branded consumer products. Selling, general and administrative expenses totaled $1.97 for the fourth quarter 2024, as compared to $1.30 for the fourth quarter 2023. Selling, general and administrative expenses totaled $6.22 million for 2024, as compared to $3.75 million in 2023. The increase year-over-year was attributable to increases in compensation and benefits, share-based compensation, advertising, marketing and Amazon fees, professional and consulting fees, and other expenses, offset by decreases in investor and shareholder services and franchise taxes and corporate insurance. EBITDA1, a non-GAAP financial measure, totaled ($0.73). million for the fourth quarter of 2024 as compared to ($.97) million for the fourth quarter of 2023. EBITDA for 2024 totaled ($2.76) million as compared to ($2.92) million in 2023. Adjusted EBITDA1, a non-GAAP financial measure, totaled ($0.62) million for the fourth quarter 2024 as compared to ($0.88) million for the fourth quarter 2023. Adjusted EBITDA for 2024 totaled ($2.43) million as compared to ($2.80) million for 2023. Net loss for the fourth quarter of 2024 was $0.85 million, as compared to a net loss of $1.10 million for the fourth quarter of 2023. Net loss for 2024 totaled $3.28 million as compared to a net loss of $3.16 million in 2023. Of note, our fourth quarter net loss includes two inventory write offs totaling $243 thousand that are one-time in nature. One write-off of $197 thousand related to high minimum order quantity inventory purchases in 2022 for SilverSeal and Turf Guard 2x3. High minimum order quantities were a significant challenge to launching new products and were one of the motivating factors for our Q1 2023 joint venture with CG Converting and Packaging, which now allows us to control the manufacturing process and, as a result, we do not expect any future write-offs. The second is for $46 thousand for additional excess and obsolete inventory. As of December 31, 2024, the Company had a cash balance of approximately $1.81 million. As of March 24, 2025, NEXGEL had 7,654,038 shares of common stock outstanding. 1. EBITDA and Adjusted EBITDA are a non-GAAP measures described in the section titled Non-GAAP Financial Measures” below and reconciled to the most directly comparable GAAP measures at the end of this release. Fourth Quarter and Full Year 2024 Financial Results Conference CallDate: March 24, 2025Time: 4:30 p.m. ETLive Call: 1-800-245-3047 (U.S. Toll Free) or 1-203-518-9765 (International)Webcast: Events and Presentations For interested individuals unable to join the conference call, a replay will be available through April 3, 2025, by dialing 1-844-512-2921 (U.S. Toll Free) or 1-412-317-6671 (International). Participants must use the following code to access the replay of the call: 11158402. An archive of the webcast will also be available for 90 days. About NEXGEL, INC.NEXGEL is a leading provider of healthcare, beauty, and over-the-counter (OTC) products including ultra-gentle, high-water-content hydrogels. Based in Langhorne, Pa., the Company has developed and manufactured electron-beam, cross-linked hydrogels for over two decades. NEXGEL brands include SilverSeal®, Hexagels®, Turfguard®, Kenkoderm® and Silly George®. Additionally, NEXGEL has strategic contract manufacturing relationships with leading consumer healthcare companies. Non-GAAP Financial MeasuresCertain Non-GAAP financial measures are included in this press release. In the calculation of these measures, the Company excludes certain items, such as amortization of intangible assets, stock-based compensation, tax impact of adjustments, other unusual items and discrete items impacting income tax expense. The Company believes that excluding such items provides investors and management with a representation of the Company's core operating performance and with information useful in assessing its prospects for the future and underlying trends in the Company's operating expenditures and continuing operations. Management uses such Non-GAAP measures to evaluate financial results and manage operations. The release and the attachments to this release provide a reconciliation of each of the Non-GAAP measures referred to in this release to the most directly comparable GAAP measure. The Non-GAAP financial measures are not meant to be considered a substitute for the corresponding GAAP financial statements and investors should evaluate them carefully. These Non-GAAP financial measures may differ materially from the Non-GAAP financial measures used by other companies. Forward-Looking Statement This press 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 Exchange Act of 1934, as amended (the “Exchange Act”) (which Sections were adopted as part of the Private Securities Litigation Reform Act of 1995). Statements preceded by, followed by or that otherwise include the words “believe,” “anticipate,” “estimate,” “expect,” “intend,” “plan,” “project,” “prospects,” “outlook,” and similar words or expressions, or future or conditional verbs, such as “will,” “should,” “would,” “may,” and “could,” are generally forward-looking in nature and not historical facts, including, without limitation, our expectation that our revenue will be at least $2.8 million in the first quarter of 2025 and our expectation to generate at least $13 million in revenue for 2025 and achieve positive cash flow from operations during the year. These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the Company's actual results, performance, or achievements to be materially different from any anticipated results, performance, or achievements for many reasons. The Company disclaims any intention to, and undertakes no obligation to, revise any forward-looking statements, whether as a result of new information, a future event, or otherwise. For additional risks and uncertainties that could impact the Company's forward-looking statements, please see the Company's Annual Report on Form 10-K for the year ended December 31, 2024, including but not limited to the discussion under “Risk Factors” therein, which the Company filed with the SEC and which may be viewed at http://www.sec.gov/. Investor Contacts:Valter Pinto, Managing DirectorKCSA Strategic Communications212.896.1254Nexgel@kcsa.com NEXGEL, INCCONSOLIDATED BALANCE SHEETS(in thousands, except share and per share data)   December 31, 2024  December 31, 2023 ASSETS:        Current Assets:        Cash $1,807  $2,700 Accounts receivable, net  933   633 Inventory  1,751   1,319 Prepaid expenses and other current assets  623   400 Total current assets  5,114   5,052 Goodwill  1,128   1,128 Intangibles, net  807   326 Property and equipment, net  2,211   1,499 Operating lease - right of use asset  1,628   1,855 Other assets  95   95 Total assets $10,983  $9,955          LIABILITIES AND STOCKHOLDERS’ EQUITY        Current Liabilities:        Accounts payable $761  $579 Accounts payable – related party  531   654          Accrued expenses and other current liabilities  310   398 Deferred revenue  179   20 Current portion of note payable  97   80 Warrant liability  118   146 Contingent consideration liability  178   439 Finance lease liability, short term  59   - Operating lease liability, current portion  237   233 Total current liabilities  2,470   2,549 Operating lease liability, net of current portion  1,538   1,727 Finance lease liability, long term  307   - Notes payable, net of current portion  588   513 Total liabilities  4,903   4,789          Commitments and Contingencies (Note 17)                 STOCKHOLDERS’ EQUITY                 Preferred stock, par value $0.001 per share, 5,000,000 shares authorized, no shares issued and outstanding  -   - Common stock, par value $0.001 per share, 25,000,000 shares authorized; 7,638,497 and 5,741,838 shares issued and outstanding as of December 31, 2024 and 2023, respectively  8   6 Additional paid-in capital  23,743   19,406 Accumulated deficit  (17,996)  (14,715)Total NexGel stockholders’ equity  5,755   4,697 Non-controlling interest in joint venture  325   469 Total stockholders’ equity  6,080   5,166 Total liabilities and stockholders’ equity $10,983  $9,955  NEXGEL, INC.CONSOLIDATED STATEMENTS OF OPERATIONS(in thousands, except share and per share data)          Year Ended December 31,   2024  2023 Revenues, net $8,688  $4,089          Cost of revenues  5,940   3,715          Gross profit  2,748   374          Operating expenses        Research and development  78   103 Selling, general and administrative  6,224   3,748 Total operating expenses  6,302   3,851          Loss from operations  (3,554)  (3,477)         Other income (expense)        Change in fair value of warrant liability, net of warrant modification expense  28   96 Realized gain on investments in marketable securities  68   191 Interest expense, net  (81)  (15)Change in fair value of contingent consideration  (18)  - Other expense  (4)  (2)Other income  98   19 Total other income (expense), net  91   289 Loss before income taxes  (3,463)  (3,188)Income tax expense  -   - Net loss  (3,463)  (3,188)Less: Loss attributable to non-controlling interest in joint venture  182   31 Net loss attributable to NexGel stockholders $(3,281) $(3,157)         Net loss per common share – basic and diluted $(0.50) $(0.56)         Weighted average shares used in computing net loss per common share – basic and diluted  6,511,574   5,671,842  NEXGEL, INC.CONSOLIDATED STATEMENTS OF CASH FLOWS(in thousands)          Year Ended December 31,   2024   2023 Operating Activities        Net loss $(3,281 ) $(3,157)Adjustments to reconcile net loss to net cash used in operating activities:        Loss attributable to non-controlling interest in joint venture  (182 )  (31) Depreciation and amortization  436    226 Share-based compensation  367    217 Realized gain on investment in marketable securities  (68 )  (191)Change in fair value of warrant liability  (28 )  (125)Change in fair value of contingent consideration  18    - Amortization of right of use asset  42    217 Warrant modification expense  -    29          Changes in operating assets and liabilities:        Accounts receivable, net  (300 )  (411)Inventory  (432 )  (760)Prepaid expenses and other current assets  (223 )  (260)Accounts payable  182    314 Accounts payable – related party  (123 )  654 Accrued expenses and other current liabilities  (434 )   22 Deferred revenue  159    20 Net Cash Used in Operating Activities  (3,867 )  (3,236)         Investing Activities        Purchases of equipment  (443 )  (696)Investment in subsidiary  (400 )  (547) Proceeds from sales of marketable securities  68    5,699 Net Cash Provided by (Used in) Investing Activities  (775 )   4,456          Financing Activities        Principal payments on operating lease liability  -    (175)Proceeds from notes payable  -    315 Payment of contingent consideration  (279 )  - Proceeds from rights offering  3,772    - Principal payments of notes payable  (77)   (6) Proceeds from non-controlling interest  38    - Principal payment of financing lease liability  (50)   - Proceeds from margin line of credit  345    245 Net Cash Provided by Financing Activities  3,749    379          Net Increase (Decrease) in Cash  (893)   1,599 Cash  – Beginning of year  2,700    1,101 Cash – End of year $1,807   $2,700          Supplemental Non-cash Investing and Financing Activities        Shares issued in conjunction with asset acquisition $200   $- Property and equipment financed under notes payable $169   $- Property and equipment financed under financing leases $416   $  Property and equipment contributed as capital investment to JV $-   $500 ROU asset and operating lease liabilities recognized upon consolidation of JV $-   $334  RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES(in thousands, except per share amounts)CALCULATION OF EBITDA & ADJUSTED EBITDA   Three Months Ended September 30,  Three Months Ended December 31,   2024  2024  2023   Amount  Amount  Amount           Net (loss) income: $(754) $(824) $(1,187)Less: Loss (income) attributable to non-controlling interest in joint venture  61   (26)  89 Net loss attributable to NexGel stockholders  (693)  (850)  (1,098)Adjustments:            Depreciation and amortization  184   108   123 Interest expense, net  20   16   3 EBITDA  (489)  (726)  (972)Change in warrant liability(1)  (11)  9   - Share-based compensation expense(2)  153   96   97 Adjusted EBITDA: $(347) $(621) $(875)  Year Ended December 31,   2024  2023   Amount  Amount        Net (loss) income: $(3,463) $(3,188)Less: Loss (income) attributable to non-controlling interest in joint venture  182   31 Net loss attributable to NexGel stockholders  (3,281)  (3,157)Adjustments:        Depreciation and amortization  436   226 Interest expense, net  81   15 EBITDA  (2,764)  (2,916)Change in warrant liability(1)  (28)  (96)Share-based compensation expense(2)  367   217 Adjusted EBITDA: $(2,425) $(2,795)  (1)This adjustment gives effect to non-cash warrant liability changes incurred during the periods. (2)The adjustments represent share-based compensation expense related to awards of stock options, restricted stock units, or common stock in exchange for services. Although we expect to continue to award stock in exchange for services, the amount of non-cash stock-based compensation is excluded as it is subject to change as a result of one-time or non-recurring projects.

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