Elite Pharms Inc

Good morning, ladies and gentlemen, and welcome to the Elite Pharmaceuticals conference call. At this time, all lines have been placed on listen-only mode. Before management begins speaking, the company has the following statement. Elite would like to remind their listeners that remarks made during this call may contain forward-looking statements that involve risks and uncertainties and are subject to changes at any time, including but not limited to statements about Elite's expectations regarding future operating results. Forward-looking statements are made pursuant to the safe harbor provisions of the federal securities laws and represent management's current expectation. Actual results may differ materially. Elite disclaims any obligation to update or revise its forward-looking statements except as required by law. More complete information regarding forward-looking statements, risks, and uncertainties can be found in the reports Elite files with the SEC, which are available on Elite's website at ElitePharma.com under the Investor Relations section. Elite encourages you to review these documents carefully. With that covered, it is now my pleasure to turn the floor over to your host, Mr. Nasrat Hakim, President and Chief Executive Officer of Elite Pharmaceuticals. Sir, the floor is yours.

Thank you, Paul, and good morning, ladies and gentlemen. Thank you for joining us today. My name is Nasrat Hakim. I am Elite's Chairman and CEO This is our earnings call, and our CFO, Robert Chen, will give us a summary of the company's financials, after which I'll come back with a corporate update and answer some of the questions that you submitted to Diane. Robert, you have the floor.

Thank you, Nazareth, and thank you to everyone who joined our second quarter conference call today. Yesterday, we filed our thank you for our second quarter in the September 30th It leads on a March fiscal year. A copy of the 10Q is available in the investor section of our website at the edpharma.com. It is also on sec.gov and the many other websites that provide link to our filings. Now I would like to give an overview of the financial and some commentary as well. Let me start with the income statement. We had a strong sales of about 8.6 million for this quarter, up a little bit as compared to same quarter last year. Our sales on amphetamine IR tablets and amphetamine ER capsules remain steady. Moving down to cost of goods sold is a general trend. Our cost of goods sold reflects direct proportionally to the level of revenue at about $4.8 million for both periods. The company post a gross profit of about $3.8 million for both periods. Our operating expenses stand at about $2.7 million for this quarter and $2.3 million for the prior quarter. The increase in operating expense was largely due to the increased spending in product development. As a result, our operating income was about $1.1 million versus $1.4 million for prior quarter last year. Our net income was about $1.5 million as compared to $1.8 million for the prior quarter. The main driver contributing to the decrease in net income was the increased spending in interest payment. Now I'm going to move to a six-month period ended September 30, 2022, we had a strong sales of about 16.3 million versus 15.6 million for the same quarter last year, up about 0.6 million or 4%. This is primarily due to the stronger sales of amphetamine IR tablets and amphetamine ER capsules. Just for your information, as I like to mention to remind you as a gentle reminder, The company has been on an upward trend in sales, including $8 million in 2019, $18 million in 2020, $25 million in fiscal year 2021, and $32 million for last year. For the first two quarters, the cost of goods sold was about $8.4 million versus $8.3 million for last year, and the gross profit was about $7.8 million at $0.5 million over last year due to stronger revenue. Our operating expense stands at about $5.7 million versus $5 million for both periods. The increase in operating expense was mostly attributable to the increase in payroll and professional expenses. Our operating income was about $2.1 million versus $2.4 million for the same period last year. Income for the six-month end of September 30, 2022 was about $1.8 million as compared to $4.2 million for prior period. The main drivers contributing to the decrease in net income including the following three factors. The first one, about $0.8 million from the derivative liability due to outstanding stock warrants and $0.9 million for NOL sales which the company does not have during this period, and a 0.4 million spending increase in interest payments. For your information, the change in the fair value of a derivative instrument is determined in large part by the change in closing price of a common stock with an inverse relationship. In other words, the higher the common stock price, the larger the liability. So for your information as well, this transaction does not have any impact on companies' cash flow. Let me now move down to our balance sheet. Our working capital was strong at about $24 million up about $12 million as compared to March 31, 2022. The increase in working capital reflects the company's ability to control its spending and also to a great degree due to the $12 million loan we have obtained from EastWest Bank in April this year. The loan will be used for general working purpose. Our total cash on hand is about $19 million at September 30, 2022. With that, I will now turn the floor back to Nasred for the overview on the company.