Healthy Extracts Reports Record Fiscal Year 2022 Financial Results
Record Net Revenue up 34% with Strong Subscription-Based Revenue Growth
LAS VEGAS, March 31, 2023 (GLOBE NEWSWIRE) -- Healthy Extracts Inc. (OTCQB: HYEX), a leading developer and distributor of plant-based nutraceutical products for heart and brain health, reported results for the year ended December 31, 2022. All comparisons are to the year-ago period unless otherwise noted.
2022 Financial Highlights
Net revenue totaled a record $2.3 million, up 34%, due to product line and distribution channel expansion.
Gross profit totaled $1.4 million, up 97%, driven by revenue growth and higher gross margins.
Gross margin was 60.9% versus 41.5% in 2021. Normalizing for certain inventory utilization, gross margin was 65.2% in 2022 and 66.8% in 2021.
Operating expenses decreased 12% to $2.3 million, which included $457,000 in non-cash expense and interest expense.
Net loss decreased 51% to $983,000 or $(0.00) per basic and diluted share. Excluding non-cash expense and interest expense, net loss totaled $526,000.
Subscription customers at December 31, 2022 increased 87% from December 31, 2021. Growth in subscribers helps lower customer acquisition costs and provides greater visibility into future potential revenue.
2022 Operational Highlights
Launched premium Citrus Bergamot SuperFruit™ heart health supplement, BergaMet PRO+™, on Fullscript.com, the nation’s leading care delivery platform for integrative medicine.
Healthy Extracts top brand influencer and renowned fitness expert, Whitney Johns, launched her new line of natural health products on whitneyjohns.com and the Whitney Johns Nutrition Amazon Store. The WHITNEY JOHNS™ line of BRAIN ACTIVATE™, Brain Activate – Gel™, Brain Activate - ENERGY Gel™, ACTIVE™, WOMEN’S CITRUS BERGAMOT™ and WOMEN’S HORMONE SUPPORT™ products are based on Healthy Extracts’ Citrus Bergamot SuperFruit™ and Ultimate Brain Nutrients™ formulations.
Entered traditional retail marketplace with the launch of company’s brain health products through more than 160 Natural Grocers® Stores nationwide (operated by Vitamin Cottage Natural Food Markets). Shipped second order to Natural Grocers® in the third quarter.
Appointed J. Scott Landers as executive vice president of sales and marketing to spearhead the launch and revenue growth of new product and service offerings.
2022 Published Research Highlights
Reported a key ingredient in WHITNEY JOHNS ACTIVE formulation was in published study in Journal of Sports Medicine and Therapy to increase nitric oxide by 73% and oxygen consumption (VO2 max) by 24%, thereby enhancing physical performance and the benefits of exercise.
Announced strong results from a study highlighting UBN RELIEF’s ability to naturally support the number and duration of migraine episodes for chronic migraine sufferers. The study was published in World Journal of Advanced Research and Reviews.
Launched a new research study investigating the effect of UBN ACTIVATE™ on the energy, focus and scores of golfers.
Subsequent Event
In January 2023, the company entered an agreement to acquire Hyperion and Online Publishing & Marketing. Additional details about the transaction are available in a Form 8-K. The transaction is dependent on certain closing terms and no assurances can be provided that it will be completed as described.
Management Commentary
“Our record top-line for 2022 was driven by growing consumer demand for our expanded product offerings which were delivered through our broadening sales channels,” commented Healthy Extracts president, Duke Pitts. “This includes the launch of several Whitney Johns-branded products on her e-commerce website and Amazon store. Both of these online channels offer subscription or ‘Subscribe & Save” options, which has helped expand our recurring revenue stream with steady subscriber growth throughout the year.
“These Whitney Johns branded products were introduced under our new brand influencer program and were designed especially for Whitney’s health-conscious followers who now total more than a million across her social media channels.
“We also launched our premium Citrus Bergamot SuperFruit™ heart health supplements on Fullscript.com, which expanded our reach to thousands of healthcare practitioners and their millions of patients across the U.S. This enables us to tap the increasing trend of healthcare practitioners utilizing natural supplements.
“In addition to these new online channels, we entered the traditional retail marketplace with Natural Grocers, the nation's largest family-operated organic and natural grocery retailer. Natural Grocers was the perfect venue for this retail launch given how they provide extensive free science-based nutrition education programs that help their customers make informed buying choices. Natural Grocers’ acclaimed high standards for natural and organic products also represents a tremendous validation of our plant-based formulations for brain health. We expect such in-person retail exposure with Natural Grocers to further elevate consumer awareness of our brands, with this also benefiting our online channels.
“In further support of doctors utilizing our products, as well as retailers like Natural Grocers who provide science-based nutritional education, in 2022 we announced two key publications of research studies covering the brain health benefits of our products. To also support brand influencers like Whitney Johns who focus on sports and physical performance, during the year we began a new study investigating the effect of UBN ACTIVATE™ on golfers’ energy, focus and scores. We believe such research studies create key differentiators from other products in the marketplace and provide our customers with greater confidence in their purchase decision.
“In 2023, we look forward to working with Whitney Johns on additional formulations centered around gut health. We will also continue to pursue strategic acquisitions that would complement our portfolio of plant-based products and leverage our broad distribution channels. Such potential transactions would build upon our acquisitions of BergametNA™ for heart health in 2019 and Ultimate Brain Nutrients™ for brain health in 2020, both of which laid the foundation for our growth and broadening market reach in 2022 and our strong start to the new year.”
2022 Financial Summary
Net revenue in the full year of 2022 increased 34% to $2.3 million from $1.7 million in 2021, primarily due to product line and distribution channel expansion.
Gross profit totaled $1.4 million or 60.9% of net revenue as compared to $695,000 or 41.5% of net revenue in 2021. Normalizing for certain inventory utilization, gross margin was 65.2% in 2022 and 66.8% in 2021.
Operating expenses decreased 12% to $2.3 million compared to $2.6 million in 2021. The decrease in operating expenses was due to decreased general and administrative expenses.
Net loss totaled $983,000 or $(0.00) per basic and diluted share compared to a net loss of $2.0 million or $(0.01) per basic and diluted share in 2021. The full year of 2022 included $457,000 in non-cash expense and interest expense. Excluding non-cash expense and interest expense, net loss totaled $526,000 in 2022.
About Healthy Extracts “Live Life Young Again”
Healthy Extracts Inc. is a platform for acquiring, developing, researching, patenting, marketing, and distributing, plant-based proprietary products in select high-growth categories within the multibillion-dollar nutraceuticals market.
The company’s subsidiaries, BergametNA™ and Ultimate Brain Nutrients™ (UBN), offer nutraceutical natural heart and brain health supplements. This includes the only heart health supplement distributed in North America containing Citrus Bergamot SuperFruit™. This superfruit is known to have the highest quality and concentration of polyphenols and flavonoids, and with healthy heart benefits backed by multiple published studies.
UBN KETONOMICS® proprietary formulations have been shown to support brain health, including memory, cognition, focus and neuro-energy. UBN is pursuing intellectual property license opportunities for monetizing its IP portfolio of multiple issued and pending patents.
For more information visit: healthyextractsinc.com, bergametna.com or tryubn.com.
Forward-Looking Statements and Safe Harbor Notice
All statements other than statements of historical facts included in this press release are "forward-looking statements" (as defined in the Private Securities Litigation Reform Act of 1995). Such forward-looking statements include our expectations and those statements that use forward-looking words such as "projected," "expect," "possibility" and "anticipate." The achievement or success of the matters covered by such forward-looking statements involve significant risks, uncertainties and assumptions. Actual results could differ materially from current projections or implied results. Investors should read the risk factors set forth in the Company's Annual Report on Form 10-K filed with the SEC on April 1, 2022, and future periodic reports filed with the SEC. All of the Company's forward-looking statements are expressly qualified by all such risk factors and other cautionary statements.
The Company cautions that statements and assumptions made in this news release constitute forward-looking statements and make no guarantee of future performance. Forward-looking statements are based on estimates and opinions of management at the time statements are made. The information set forth herein speaks only as of the date hereof. The Company and its management undertake no obligation to revise these statements following the date of this news release.
Food and Drug Administration Disclosure
The product and formulation featured in this release is not for use by or sale to persons under the age of 12. This product should be used only as directed on the label. Consult with a physician before use if you have a serious medical condition or use prescription medications. A doctor’s advice should be sought before using this and any supplemental dietary product. These statements have not been evaluated by the FDA. This product is not intended to diagnose, treat, cure or prevent any disease.
BergametNA™, Ultimate Brain Nutrients™, UBN™, Citrus Bergamot SuperFruit™ and F4T® are registered trademarks of Healthy Extracts Inc.™ Natural Grocers® is a registered trademark of Vitamin Cottage Natural Food Markets.
Healthy Extracts Company Contact
Duke Pitts, President
Healthy Extracts Inc.
Tel (720) 463-1004
Email contact
Investor Contact
Ronald Both
CMA Investor Relations
Tel (949) 432-7566
Email contact
Media Contact:
Tim Randall
CMA
Tel (949) 432-7572
Email Contact
HEALTHY EXTRACTS, INC. | ||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||
(Audited) | ||||||||
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| DECEMBER 31, |
| DECEMBER 31, | ||||
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| 2022 |
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| 2021 |
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ASSETS |
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CURRENT ASSETS |
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Cash |
| $ | 65,651 |
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| $ | 222,098 |
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Accounts receivable |
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| 105,794 |
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| 133,340 |
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Inventory |
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| 1,819,128 |
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| 1,957,966 |
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Total current assets |
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| 1,990,572 |
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| 2,313,404 |
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Fixed assets, net of accumulated depreciation of $44,709 and $45,474, respectively |
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| 5,501 |
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| 1,035 |
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Patents/Trademarks |
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| 521,881 |
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| 521,881 |
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Deposit |
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| 16,890 |
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| - |
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Prepaid Acquisition Costs |
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| 53,015 |
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| - |
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Goodwill |
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| 193,260 |
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| 193,260 |
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Total other assets |
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| 790,546 |
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| 716,175 |
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TOTAL ASSETS |
| $ | 2,781,118 |
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| $ | 3,029,579 |
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LIABILITIES AND STOCKHOLDERS' DEFICIT |
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LIABILITIES |
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Accounts payable |
| $ | 91,316 |
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| $ | 37,267 |
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Accrued liabilities |
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| 94,554 |
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| 59,264 |
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Notes payable |
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| 275,370 |
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| - |
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Notes payable - related party |
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| 866 |
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| 170,866 |
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Convertible debt, net of discount of $0.00 and $0.00, respectively |
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| 317,284 |
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| 171,750 |
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Convertible debt - related party, net of discount of $0.00 and $0.00, respectively |
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| - |
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| - |
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Accrued interest payable |
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| 21,387 |
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| 13,050 |
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Accrued interest payable - related party |
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| - |
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| 14,118 |
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Derivative liabilities |
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| 102,011 |
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| 92,527 |
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Total current and total liabilities |
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| 902,788 |
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| 558,841 |
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STOCKHOLDERS' EQUITY (DEFICIT) |
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Preferred stock, $0.001 par value, 75,000,000 shares authorized, |
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none and none shares issued and outstanding, respectively |
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| - |
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| - |
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Common stock, $0.001 par value, 2,500,000,000 shares authorized, |
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345,172,442 and 338,384,171 shares issued and outstanding, respectively |
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| 345,172 |
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| 338,384 |
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Additional paid-in capital |
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| 17,459,899 |
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| 17,075,974 |
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Accumulated deficit |
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| (15,926,742 | ) |
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| (14,943,620 | ) |
Total stockholders' equity (deficit) |
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| 1,878,330 |
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| 2,470,738 |
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) |
| $ | 2,781,118 |
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| $ | 3,029,579 |
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HEALTHY EXTRACTS, INC. | ||||||||
CONSOLIDATED STATEMENT OF OPERATIONS | ||||||||
(Audited) | ||||||||
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| FOR THE YEAR ENDING | ||||||
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| DECEMBER 31, | ||||||
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| 2022 |
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| 2021 |
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REVENUE |
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Gross revenue |
| $ | 2,251,469 |
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| $ | 1,676,598 |
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Net revenue |
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| 2,251,469 |
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| 1,676,598 |
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COST OF REVENUE |
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Cost of goods sold |
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| 783,141 |
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| 556,972 |
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Written off inventory |
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| 96,811 |
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| 424,548 |
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Total cost of revenue |
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| 879,951 |
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| 981,520 |
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GROSS PROFIT |
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| 1,371,517 |
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| 695,078 |
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OPERATING EXPENSES |
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General and administrative |
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| 2,283,107 |
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| 2,584,256 |
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Total operating expenses |
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| 2,283,107 |
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| 2,584,256 |
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OTHER INCOME (EXPENSE) |
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Interest expense, net of interest income |
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| (64,690 | ) |
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| (52,453 | ) |
Change in fair value on derivative |
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| (9,484 | ) |
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| (85,325 | ) |
Loss on extinguishment of debt |
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| - |
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| - |
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SBA loan forgiveness |
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| - |
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| 39,833 |
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Gain on sale of asset |
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| 2,643 |
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| - |
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Total other income (expense) |
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| (71,531 | ) |
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| (97,945 | ) |
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Net gain/(loss) before income tax provision |
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| (983,121 | ) |
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| (1,987,122 | ) |
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NET GAIN/(LOSS) |
| $ | (983,121 | ) |
| $ | (1,987,122 | ) |
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Loss per share - basic and diluted |
| $ | (0.00 | ) |
| $ | (0.01 | ) |
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Weighted average number of shares outstanding - basic and diluted |
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| 342,514,810 |
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| 319,209,932 |
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