In its second quarter 2018 earnings release, Cardax announced that it had brought in $272,000 in revenue in the quarter, compared to $66,000 in the same quarter a year previously. For the first six months of the year, the revenue figures were $585,000 and $174,000 respectively.
Cardax said the results were driven primarily by sales to GNC, its largest customer. The company’s primary market is still Hawaii, where Cardax is based. Other sales took place in California, Nevada and New York, according to the company.
The company claimed that this sales increase is the result of its extensive physician outreach program. The company has now conducted what it characterized in a press release as “over 1,000 high quality interactions with physicians and other health care professionals at conferences, meetings, and continuing medical education events.”
The company said it has also been conducting a program of GNC in-store sales support, which “builds on the ability to utilize ZanthoSyn as a foundation of health, wellness, and performance regimens.”
"We are very pleased to see continuing sales growth in the selected US markets where we have focused our sales and marketing efforts thus far," said David G. Watumull, Cardax President and CEO.
Cardax also maintains that it continues to pursue a development program for a higher concentration astaxanthin product. In its form 10-Q public filing, the company said it is also considering a pharmaceutical application for this product.
After some hemming and hawing, Cardax revealed last December that DSM’s synthetic astaxanthin is the raw material it is using in its finished goods brand.
Questions about the future
Amid the good news of a successful market launch of its finished goods brand, Cardax also revealed a trend of continued losses. Cardax reported a loss from operations in the second quarter of $1.1 million. The six month loss figure for 2018 was $2.1 million. The losses recorded for those two periods in 2017 were $395,000 and $846,000, respectively.
And the company has since its inception accrued a significant overhang of negative results. According to its most recent public filing, Cardax now has an accumulated deficit of $60 million.
In the portion of the filing titled “Going concern matters,” the company had this to say:
“The Company expects that its marketing program for ZanthoSyn will continue to focus on outreach to physicians, healthcare professionals, retail personnel, and consumers, and anticipates further losses in the development of its business. As a result of these and other factors, management has determined there is substantial doubt about the Company’s ability to continue as a going concern.”
The company did report concluding a deal in late July in which holders of warrants on the company’s stock exchanged those for shares for a payment of 15 cents a share. The transaction reportedly brought in about $1.1 million in new financing. The company’s stock is now trading at about 22 cents a share.