Integrated Biopharma Reports 5.4% Revenue Growth, Improved Profitability in Q3 2024

Integrated Biopharma Inc. reported a revenue increase for the three months ended September 30, 2024, with net sales reaching $13,617,000, up 5.4% from $12,915,000 in the same period of 2023. The growth was primarily driven by a $536,000 increase in the Contract Manufacturing Segment, attributed to higher sales volumes to Herbalife and other customers, despite a decline in sales to Life Extension. The Other Nutraceuticals Segment also saw a notable increase of $166,000.

Gross profit for the quarter improved significantly to $1,371,000, compared to $832,000 in the prior year, reflecting enhanced profit margins that rose from approximately 6.4% to 10.1% of net sales. Operating income turned positive at $490,000, a substantial increase from an operating loss of $54,000 in the same quarter of 2023. This improvement in profitability was offset by a net loss of $259,000 for the period, although this was an improvement from a net loss of $59,000 in the previous year.

The company’s cash position strengthened, with cash increasing to $2,271,000 as of September 30, 2024, up from $1,677,000 at the end of June 2024. Total current assets also rose to $18,312,000, while total assets slightly decreased to $26,183,000. Current liabilities decreased to $6,029,000, contributing to an increase in total stockholders' equity to $19,550,000.

Operating activities generated $657,000 in cash, down from $1,313,000 in the same period last year, with a net increase in cash of $594,000 compared to $1,278,000 in 2023. The company reported a federal income tax expense of $190,000 and a state income tax expense of approximately $54,000 for the quarter.

Despite the positive financial developments, Integrated Biopharma faced challenges, including inflationary pressures and a tight labor market, which negatively impacted margins. Additionally, geopolitical factors, such as the ongoing Israel-Hamas conflict, could potentially affect sales and margins, particularly for customers sourcing materials from the region. The company has no outstanding debt under its Senior Credit Facility, which allows for $5,000,000 in financing, and management believes that operations and available credit will support working capital needs through at least November 2025.