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Better Choice Company Inc. (BTTR-3.16%) has submitted its 10-Q filing for the quarterly period ended September 30, 2024.
The filing reports net sales of $11.4 million for the quarter, down from $13.1 million in the same period the previous year. This decline is attributed to the strategic exit from unprofitable customers in the Brick & Mortar channel and the shutdown of the direct-to-consumer channel.
Gross profit for the quarter was $4.5 million, a slight increase from $4.4 million in the previous year. The gross margin improved to 40% from 34%, primarily due to better pricing from manufacturers and a shift in product sales mix.
Operating expenses decreased to $5.6 million from $7.1 million, driven by reductions in sales and marketing costs, employee compensation, and share-based compensation.
Net income for the quarter was $1.5 million, a significant improvement from a net loss of $1.6 million in the previous year. This was largely due to a gain on the extinguishment of debt and accounts payable related to a settlement with Alphia Inc.
Cash used in operating activities increased to $3.2 million from $0.9 million, primarily due to working capital fluctuations and the gain on debt extinguishment.
The company's cash and cash equivalents stood at $4.7 million as of September 30, 2024, compared to $4.5 million at the end of 2023.
The filing highlights ongoing efforts to improve operating profitability through margin improvement initiatives, pricing strategy optimization, and new product innovation.
The company acknowledges substantial doubt about its ability to continue as a going concern, citing historical losses and the need for additional capital or financing.
The report also discusses the company's recent corporate developments, including a public offering in July 2024 and a strategic exit from certain retail channels.
The filing outlines the company's growth strategy, focusing on brand building, online sales expansion, and global market penetration, particularly in Asia-Pacific and Latin America.
The company continues to address material weaknesses in its internal controls, with ongoing remediation efforts in cybersecurity, IT general controls, and revenue recognition.
This content was summarized by generative artificial intelligence using public filings retrieved from SEC.gov. The original data was derived from the Better Choice Company Inc. quarterly 10-Q report dated November 14, 2024. To report an error, please email earnings@qz.com.