LANGHORNE, PA — NEXGEL, Inc. (NASDAQ: NXGL) this week disclosed its first-quarter financial outcomes for 2024, showcasing significant growth and strategic advancements. The company, known for its innovative contract manufacturing and consumer branded product segments, reported a notable year-over-year revenue increase of 104%.
Chief Executive Officer Adam Levy expressed satisfaction with the company’s trajectory, noting, “Following a record year of growth in 2023, our first quarter results for 2024 demonstrate steady growth year-over-year and preparedness for significant growth levers we expect in 2024.” Levy highlighted the expansion of the company’s Texas facility and the impending product launches in partnership with Abbvie among the key drivers of anticipated growth.
The revenue surge was particularly strong in the company’s consumer branded product business, which saw an increase of 178%, alongside a 58% rise in contract manufacturing sales. This growth contributed to a gross profit of $277,000 for the quarter, a stark reversal from a gross loss reported in the same period last year.
The company’s gross profit margin improved markedly to 21.9% from negative margins the previous year, signifying enhanced operational efficiency and profitability. This improvement reflects NEXGEL’s successful strategy in managing costs while expanding its product lines, particularly in consumer branded products which drove the majority of the gross profit increase.
NEXGEL’s strategic investments into facility expansion and state-of-the-art equipment, as mentioned by Levy, are poised to bolster the company’s production capabilities. This is in preparation for scaling operations in response to new product launches and entering the European market, which the company is finalizing certifications for its consumer branded products.
Despite these positive developments, NEXGEL reported a net loss of $905,000 for the quarter, slightly deeper than the loss of $807,000 in the same period last year. This reflects higher operational and marketing expenses as the company positions itself for broader market penetration and future profitability. The company’s cash balance stood at $2.4 million as of March 31, 2024, after accounting for strategic investment activities aimed at fostering long-term growth.
Looking ahead, NEXGEL’s ambitious expansion efforts and forthcoming product launches signal a strategic shift towards capturing larger market share in both the contract manufacturing and consumer product spaces. The company’s readiness to leverage upcoming growth opportunities, as articulated by Levy, underscores its optimistic outlook for the remainder of 2024 and beyond.
NEXGEL’s trajectory offers a glimpse into the dynamic landscape of the hydrogel technology sector, where innovation and strategic expansion play critical roles in shaping competitive advantages. As NEXGEL navigates its growth path, its developments will likely serve as a barometer for the sector’s overall health and potential.
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