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 a 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 that 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 report's 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, Matthew, 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 CEO, 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 have submitted to Diane. Robert, you are on.

Thank you, Nesret, and thank you to everyone who's joining our third quarter conference call today. Yesterday, we filed our 10-Q for our third quarter ended December 31st. ELE is on a March fiscal year. A copy of 10-Q is announced by the announcer earlier, is available in the investor section of our website at elefarm.com. It is also on SEC, GOF, and 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. I will start with the income statement. We had a strong sales of about $9.3 million for this quarter, up by 3% as compared to the same quarter last year. Our sales on amphetamine IR tablets and amphetamine ER capsules remain steady and strong. Moving down to cost of goods sold, Our cost of goods sold was about 4.3 million as compared to 5 million for the same period in the prior fiscal year. The decrease was due in large part to an improved margin on products sold during the three-month end date of December 31st, 2022. The company posted a gross profit of about 4.9 million for this quarter versus 4 million for the prior quarter. The increase in gross profit was due to a combination of increased sales and improved product margin. Our operating expense spent is about $3 million for this quarter and $2.2 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 $2 million versus $1.8 million prior quarter last year. Our net income was about $3 million as compared to $2.3 million for the prior quarter. The main driver contributing to the increase in net income was the recognition of other income of $3 million, partially offset by the increased spending in interest payment. For the nine months ended December 31st, 2022, we had a strong sales of about 25.5 million versus 24.6 million for the same period last year, up about 0.9 million, or 4%. This is primarily due to the strong sales of amphetamine IR tablets and amphetamine ER capsules. I just want to give you information about this sales figure. Our company has been on an upward trend in sales, including $8 million in the fiscal year 2019, $18 million for 2020, $25 million for 2021, and $32 million for last year. Now, we're judging by the trends of sales so far. The company's sales number this year is expected to exceed the sales number of last year at $32 million. And we hold the momentum. We'll go on. For the first three quarters, the cost of Corsair was about $12.4 million versus $13.2 million for last year. The gross profit was about $13.2 million, a $1.8 million over last year, due to strong revenue and improved product margin. Our operating expenses stand at about $9.1 million versus $7.2 million for both periods. The increase in operating expense was mostly attributable to the increase of spending in product development, in payroll and professional expenses. Our operating income was about 4.1 million versus 4.2 for the same period last year. Our net income for the nine months ended December 31st, 2022, was about 4.8 million as compared to 6.5 for the prior period. The main driver contributing to the decrease in net income including the following four factors. $1 million lower from derivative liability due to outstanding stock warrants, $0.9 million for NOL sales, which the company does not have during this period, and a $7.7 million spending increase in interest payment and a partial offset by other income of $1 million recognized in this period. So I'll give a little bit update about the derivative liability. The change in the fair value of derivative instrument is determined in large part by the change in the closing price of company's common stock with an inverse relationship. In other words, the higher the common stock price, the larger liability. Also for your information, this transaction does not have any impact on the company's cash flow. Now let me move down to a balance sheet. Our working capital remains solid at about $27 million, up about $14.3 million as compared to March 31, 2022. The increase in working capital reflects the company's ability to control its spending and to a greater degree due to the $12 million loan we have obtained from the East West Bank in April last year. The loan will be used for general working capital purpose. Our total cash on hand is about 18 million on December 31st, 2022. With that, I now will turn the floor back to Nazareth for an overview of the company.