Nephros Inc (NEPH) 2022 Q4 法說會逐字稿

Good afternoon, and welcome to the Nephros, Inc. fourth-quarter 2022 financial results conference call. (Operator Instructions) Please note this event is being recorded.

下午好，歡迎參加 Nephros, Inc. 2022 年第四季度財務業績電話會議。 （操作員說明）請注意此事件正在被記錄。

I would now like to turn the conference over to Kirin Smith, Investor Relations. Please go ahead.

我現在想將會議轉交給投資者關係部的 Kirin Smith。請繼續。

Thank you. Good afternoon, everyone. This is Kirin Smith, with PCG Advisory. Thank you all for participating in Nephros' fourth quarter and fiscal-year 2022 conference call.

謝謝。大家下午好。我是 PCG Advisory 的 Kirin Smith。感謝大家參加 Nephros 第四季度和 2022 財年電話會議。

Before we begin, I would like to caution that comments made during this conference call by management will contain forward-looking statements regarding the operations and future results of Nephros. I encourage you to review Nephros' filings with the Securities and Exchange Commission, including, without limitation, the company's Forms 10-K and 10-Q [driven by] specific factors that may cause actual results or events to differ materially from those described in the forward-looking statementas.

在我們開始之前，我想提醒大家，管理層在本次電話會議上發表的評論將包含有關 Nephros 運營和未來業績的前瞻性陳述。我鼓勵您查看 Nephros 向美國證券交易委員會提交的文件，包括但不限於該公司的 10-K 和 10-Q 表[由]可能導致實際結果或事件與中所述的結果或事件存在重大差異的特定因素驅動。前瞻性陳述。

Factors that may affect the company's results include, but are not limited to, impact from the COVID-19 pandemic, Nephros' ability to successfully, timely, and cost-effectively market and sell its products and service offerings; the rate of adoption of its products and services by hospitals and other healthcare providers; the success of its commercialization efforts and the effect of existing and new regulatory requirements on Nephros' business and other economic and competitive factors.

可能影響公司業績的因素包括但不限於 COVID-19 大流行的影響、Nephros 成功、及時和經濟高效地營銷和銷售其產品和服務的能力；醫院和其他醫療保健提供者對其產品和服務的採用率；其商業化努力的成功以及現有和新的監管要求對 Nephros 業務以及其他經濟和競爭因素的影響。

The contents of this conference call contain time-sensitive information that is accurate only as of the date of the live call today, March 8, 2023. The company undertakes no obligation to revise or update any statements to reflect events or circumstances after the date of this conference call except as required by law.

本次電話會議的內容包含時間敏感信息，僅截至今天（2023 年 3 月 8 日）現場電話會議之日準確。公司不承擔修改或更新任何聲明以反映電話會議日期之後的事件或情況的義務。本次電話會議除法律要求外。

I would now like to turn the call over to Nephros' President and Chief Executive Officer, Andy Astor. Andy, please go ahead.

我現在想將電話轉給 Nephros 總裁兼首席執行官安迪·阿斯特 (Andy Astor)。安迪，請繼續。

Thank you, Kirin, and good afternoon, everyone and welcome to the call. I'm very pleased to report and comment on our fourth quarter and year-end result, which reflects continuing positive trends, both in leading growth indicators and in cash usage.

謝謝 Kirin，大家下午好，歡迎來電。我很高興報告和評論我們的第四季度和年終業績，這反映了領先增長指標和現金使用方面持續的積極趨勢。

2022 was a year of refocusing and rebuilding for Nephros. After a very challenging first half of the year, we established a target of cash flow breakeven by mid-year 2023, coupled with significant revenue growth by that same time. As we noted in our press release today, I am pleased to say that we are making good progress on both fronts. I'll talk about each one.

2022 年是 Nephros 重新聚焦和重建的一年。經過充滿挑戰的上半年後，我們制定了到 2023 年年中實現現金流收支平衡的目標，同時收入也實現大幅增長。正如我們在今天的新聞稿中指出的那樣，我很高興地說我們在這兩方面都取得了良好進展。我將逐一討論。

In our efforts to achieve cash flow breakeven, we took multiple actions. These included broad headcount and other expense reductions, the disposition of our pathogen detection systems, or PTS business segment, and two price increases during the year, which were intended to return us to target gross margins of 55% to 60%. I am pleased to report that our fourth-quarter gross margins were 59%.

為了實現現金流收支平衡，我們採取了多項行動。其中包括大規模裁員和其他費用削減、處置我們的病原體檢測系統或 PTS 業務部門，以及年內兩次提價，旨在使我們的毛利率恢復到 55% 至 60% 的目標。我很高興地報告，我們第四季度的毛利率為 59%。

Additionally, we reduced our net cash usage from $2.8 million in the first half of 2022 to $0.5 million in the second half of the year, an 80% improvement.

此外，我們的淨現金使用量從 2022 年上半年的 280 萬美元減少到下半年的 50 萬美元，減少了 80%。

Turning our attention to revenue growth. We took several actions, including a restructuring of our sales organization, the doubling in size of our sales team, and the relaunch of our commercial filtration business, which included a rebrand of our commercial filter products from Aether to Nephros. Of further note, as we reported last week, we established a strategic partnership with Donastar Enterprises as the exclusive master distributor of our commercial filters in the food and beverage and hospitality markets.

將我們的注意力轉向收入增長。我們採取了多項行動，包括重組我們的銷售組織、將我們的銷售團隊規模擴大一倍，以及重新啟動我們的商業過濾業務，其中包括將我們的商業過濾產品從 Aether 更名為 Nephros。進一步值得注意的是，正如我們上週報導的那樣，我們與 Donastar Enterprises 建立了戰略合作夥伴關係，作為我們商用過濾器在食品、飲料和酒店市場的獨家總經銷商。

We anticipate realizing further cost savings in the second quarter of this year due to the planned cessation of operations by our majority-owned subsidiary, specialty renal products, Specialty Renal Products or SRP. In February 2023, SRP management unsuccessfully concluded its efforts to identify a strategic partner to support a commercial launch of SRP's second-generation HDF product and/or to identify potential additional investment that would allow SRP to fund the launch itself.

由於我們的控股子公司、特種腎臟產品、特種腎臟產品或 SRP 計劃停止運營，我們預計今年第二季度將進一步節省成本。 2023 年 2 月，SRP 管理層未能成功確定戰略合作夥伴以支持 SRP 第二代 HDF 產品的商業發布和/或確定允許 SRP 自行資助發布的潛在額外投資。

SRP's capital resources are now nearly exhausted. Accordingly, the SRP Board of Directors recently determined subject to the approval of SRP stockholders to wind down SRP's operations and liquidate its remaining assets. Nephros expects to re-evaluate opportunities for HDF in the future but has no immediate plans to do so.

SRP的資本資源現在幾乎耗盡。因此，SRP 董事會最近決定，在 SRP 股東批准的情況下，結束 SRP 的業務並清算其剩餘資產。 Nephros 預計未來會重新評估 HDF 的機會，但目前沒有計劃這樣做。

I'll now turn to our financial results for the quarter and year ended December 31, 2022. We reported fourth-quarter net revenue of $2.6 million, a 6% decrease over prior year and full-year revenue of $10 million or $10.0 million, a 2% decrease over prior year.

現在我將討論截至 2022 年 12 月 31 日的季度和年度財務業績。我們報告第四季度淨收入為 260 萬美元，比上年同期下降 6%，全年收入為 1000 萬美元或 1000 萬美元，比上年減少 2%。

Net consolidated loss for the quarter was $0.7 million, equivalent to that of the fourth quarter or Q4 of 2021. Net consolidated loss for the year was $4.3 million, compared with $2.8 million in 2021.

本季度合併淨虧損為 70 萬美元，相當於 2021 年第四季度或第四季度的虧損。全年合併淨虧損為 430 萬美元，而 2021 年為 280 萬美元。

Consolidated adjusted EBITDA in the quarter was negative $0.5 million compared with $0.1 million negative in 2021. Consolidated adjusted EBITDA for the year was negative $2.4 million, compared with negative $1.6 million in 2021.

本季度綜合調整後 EBITDA 為負 50 萬美元，而 2021 年為負 10 萬美元。本年度綜合調整後 EBITDA 為負 240 萬美元，而 2021 年為負 160 萬美元。

Consolidated gross margins in the quarter were 59%, compared with 54% in 2021. Consolidated gross margins for the year were 47%, compared with 55% in 2021. And as I said earlier, we do expect future gross margins to continue in the range of 55% to 60%.

本季度的綜合毛利率為 59%，而 2021 年為 54%。全年綜合毛利率為 47%，而 2021 年為 55%。正如我之前所說，我們確實預計未來毛利率將繼續保持在範圍為 55% 至 60%。

Consolidated research and development expenses in the quarter were $0.4 million, compared to 0.3 million in 2021. Consolidated research and development expenses for the year were $1.3 million, compared with $1.5 million in 2021.

本季度的綜合研發費用為 40 萬美元，而 2021 年為 30 萬美元。全年綜合研發費用為 130 萬美元，而 2021 年為 150 萬美元。

Consolidated sales, general, and administrative expenses in the quarter were $1.8 million, no change from Q4 2021. Consolidated sales, general, and administrative expenses for the year were $7.6 million, compared with $7.2 million in 2021.

本季度的合併銷售、一般和管理費用為 180 萬美元，與 2021 年第四季度相比沒有變化。全年的合併銷售、一般和管理費用為 760 萬美元，而 2021 年為 720 萬美元。

Cash used in operating activities was $202,000 compared with $336,000 in Q4 of 2021. Our cash balance on December 31, 2022 was $3.6 million, and we reassert our belief that current cash balances will suffice for the foreseeable future.

經營活動使用的現金為 202,000 美元，而 2021 年第四季度為 336,000 美元。截至 2022 年 12 月 31 日，我們的現金餘額為 360 萬美元，我們重申，目前的現金餘額足以滿足可預見的未來。

Please refer to today's press release for more details about the calculation of adjusted EBITDA and its reconciliation to GAAP net income or loss. Additional information about our result will be found in our filing on Form 10-K, which we plan to file later this month.

請參閱今天的新聞稿，了解有關調整後 EBITDA 的計算及其與 GAAP 淨收入或虧損的調節的更多詳細信息。有關我們結果的更多信息可在我們計劃於本月晚些時候提交的 10-K 表格中找到。

This concludes the financial discussion. As always, I would like to thank each of our Nephros' employees and our strategic partners for providing unsurpassed products and services to our customers, especially this year during some difficult times. And thanks also to our devoted investors for your continued confidence and your patience. We believe our continued dedication to growth and expense management have well positioned the company for future long-term success.

財務討論到此結束。一如既往，我要感謝 Nephros 的每一位員工和戰略合作夥伴為我們的客戶提供無與倫比的產品和服務，特別是今年在一些困難時期。還要感謝我們忠實的投資者一直以來的信心和耐心。我們相信，我們對增長和費用管理的持續致力於為公司未來的長期成功奠定了良好的基礎。

This concludes our formal presentation remarks. We will now take questions from the audience. Gary, will you please open the call for questions? Thank you.

我們的正式演講發言到此結束。現在我們將回答觀眾的提問。加里，請您打開電話提問好嗎？謝謝。

(Operator Instructions) Anthony Vendetti, Maxim Group.

（操作員說明）Anthony Vendetti，Maxim Group。

Thanks, Andy. So on the Donastar Enterprises agreement as your exclusive distributor outside of healthcare, were there any companies or clients you were speaking with that you are handing over to them, or is there a pipeline that they have or funnel that they're already looking at? And then how does that agreement work and how do they get paid going forward? And then any update on Chipotle and how -- does this have any impact on that or is that -- is it just a go-forward business?

謝謝，安迪。那麼，根據 Donastar Enterprises 作為您在醫療保健領域之外的獨家經銷商的協議，您是否正在與您交談的任何公司或客戶將其移交給他們，或者他們是否擁有或已經在尋找渠道？那麼該協議如何運作以及他們今後如何獲得報酬？然後是關於 Chipotle 的任何更新嗎？這是否對此有任何影響，或者是否是這樣——它只是一項向前發展的業務嗎？

Okay. Thanks, Anthony. Good to hear your voice and congratulations on your news at Maxim.

好的。謝謝，安東尼。很高興聽到你的聲音，並祝賀你在 Maxim 的消息。

Thanks.

謝謝。

Let's see. First of all, it is not exclusive outside of healthcare. I just want to make sure that we're clear. It's exclusive within the food and beverage and hospitality space. There are other non-medical spaces that they do not have an exclusive with, although we will be partnering very, very closely together as close partners.

讓我們來看看。首先，它並不排斥於醫療保健之外。我只是想確保我們清楚。它在餐飲和酒店領域是獨一無二的。儘管我們將作為密切的合作夥伴非常非常密切地合作，但他們並沒有與其他非醫療領域建立獨家合作關係。

In terms of the pipeline, the answer to your question is both. They both are bringing their own pipeline and their own network and their own relationships into the partnership. And they are also taking over all of the management from a sales and service perspective to -- of our existing customers as well. So it's really both.

就管道而言，您問題的答案是兩者兼而有之。他們都將自己的渠道、自己的網絡以及自己的關係帶入了合作夥伴關係中。他們還從銷售和服務的角度接管了我們現有客戶的所有管理。所以這確實是兩者兼而有之。

Chipotle, as you said, is one of our customers and Donastar is deeply involved with them, and that will continue and that's going very well. But I expect that we'll be adding other companies, customers, to the to the roster in the near future.

正如您所說，Chipotle 是我們的客戶之一，Donastar 與他們密切合作，這種情況將繼續下去，而且進展順利。但我預計我們將在不久的將來將其他公司、客戶添加到名冊中。

We've got a lot of energy going into the Donastar relationship, as well as some the relaunch that I mentioned, because we really did not just change our marketing and distribution strategy, we really relaunched the whole offering of filtration to the -- commercial filtration to focusing on a tighter set of products that are better -- that use our highest quality products that are all certified, that have a clear and standardized way of communicating their benefit and so forth. So it's been quite an effort. We've been quiet about it. But that effort is now rolling out in States.

我們在與 Donastar 的關係上投入了大量的精力，以及我提到的一些重新啟動，因為我們確實不只是改變了我們的營銷和分銷策略，我們確實重新啟動了整個過濾產品——商業過濾到專注於一組更嚴格、更好的產品——這些產品使用我們經過認證的最高質量產品，有清晰、標準化的方式來傳達其優點等等。所以這是相當努力的。我們對此一直保持沉默。但這一努力目前正在各州展開。

Does that answer your question, Anthony?

這能回答你的問題嗎，安東尼？

Yes, thank you. And even with this agreement, it sounds like you're still targeting 55% to 60% gross margins. So it seems like a win-win for you in terms of the relationship with Donastar.

是的，謝謝。即使有了這份協議，聽起來你們的毛利率目標仍然是 55% 到 60%。因此，就與 Donastar 的關係而言，這對您來說似乎是雙贏的。

Yeah, I think so. Thankfully, they will be -- you asked how they get compensated, they are -- they really get compensated in two ways. One, they get a discount just like any other distributor on our filters, although they have the exclusive in these markets.

是的，我想是的。值得慶幸的是，他們會 - 你問他們如何獲得補償，他們確實 - 他們確實通過兩種方式獲得補償。第一，他們像我們的過濾器的任何其他經銷商一樣獲得折扣，儘管他們在這些市場上擁有獨家權。

And then the second way, of course, is that they are a company with tremendous reach, over 1,000 service people in the field around the country. And so, they get -- by adding the exclusive filter relationship with Nephros, they have a product that helps them sell not only filters, but the services that go with them. And so, it's a win-win for everybody.

當然，第二種方式是他們是一家影響力巨大的公司，在全國范圍內擁有 1,000 多名服務人員。因此，通過添加與 Nephros 的獨家過濾器關係，他們擁有的產品不僅可以幫助他們銷售過濾器，還可以幫助他們銷售與其配套的服務。因此，這對每個人來說都是雙贏的。

Okay, great. Great. And then just switching gears. How many -- at the end of the fourth quarter, how many active customer sites do you have now?

好的，太好了。偉大的。然後只是切換齒輪。截至第四季度末，您現在有多少個活躍客戶站點？

1,394.

1,394。

Excellent. Okay, good. Let me hop back in the queue. Thanks so much, Andy. Appreciate it.

出色的。好的。讓我跳回到隊列中。非常感謝，安迪。欣賞它。

Okay. You bet. Thanks, Anthony.

好的。你打賭。謝謝，安東尼。

(Operator Instructions) [Robert Smith, Center for Performance Investing].

（操作員說明）[羅伯特·史密斯，績效投資中心]。

Hi, Andy.

嗨，安迪。

Hey, Robert.

嘿，羅伯特。

Could you discuss the growth drivers that you see going forward?

您能否討論一下您認為未來的增長動力？

I can. Thanks for asking. There really are a few. There's really just a very concentrated number of them. Number one, the growth driver is we have had too few people in the field to respond properly to all of the opportunity that's in front of us. We have now doubled the size of our sales force. We're still a small company, small sales force, but we have additional feet on the street and the ability to pound the pavement and to not only respond to incoming requests, but also to develop more on our own.

我可以。謝謝你的詢問。確實有幾個。他們的數量確實非常集中。第一，增長動力是我們在該領域的人員太少，無法正確應對擺在我們面前的所有機會。現在，我們的銷售隊伍規模已擴大了一倍。我們仍然是一家小公司，銷售隊伍也很小，但我們有更多的經驗和能力，不僅能夠響應傳入的請求，而且能夠自行開發更多產品。

We have the relationship with Donastar, which will bring us into the food and beverage space and the hospitality space, which is what they do. And I think that will drive. I think we will also have drivers environmentally in the increasingly stringent and strict regulations that are prevalent in the medical field, which we've talked about before.

我們與 Donastar 建立了合作關係，這將把我們帶入餐飲領域和酒店領域，這就是他們所做的。我認為這會推動。我認為，在醫療領域普遍存在的日益嚴格和嚴格的法規中，我們也會有環保方面的驅動力，我們之前已經討論過這一點。

And we are seeing some lift there. And while I'm not -- we're not releasing numbers for the first two months of the year, I am very optimistic that we are on the right track based on what I'm seeing internally.

我們看到那裡有一些提升。雖然我們不會發布今年前兩個月的數據，但根據我內部的觀察，我非常樂觀地認為我們正走在正確的軌道上。

Is that help helpful?

這有幫助嗎？

Yeah. Andy, was it a surprise to you the inability to get funding for that operation and the shutting down? Okay. Give us more color on that.

是的。安迪，您對無法獲得該行動的資金並被關閉感到驚訝嗎？好的。給我們更多的色彩。

Yeah. It was certainly a disappointment. I'm not sure that it was a surprise based on what I've seen over the last year or so. It's a tough time to be a microcap be in the dialysis field. And well, I don't have a [fee] right now, but it's a tough time to be looking for investment.

是的。這確實令人失望。根據我過去一年左右的所見，我不確定這是否令人驚訝。對於透析領域的微型企業來說，現在是一個艱難的時期。好吧，我現在沒有[費用]，但現在是尋找投資的艱難時期。

And frankly, there is just a structural problem with the way that we reimburse for dialysis treatment in this country where all dialysis treatments are treated equally, even if some of them are, A, more expensive; and B, have some have different or perhaps better outcomes.

坦率地說，在這個國家，我們報銷透析治療的方式存在結構性問題，所有透析治療都受到平等對待，即使其中一些治療更昂貴； B，有一些有不同的或可能更好的結果。

And so, while HDF is only increasing in popularity in Europe, it's going nowhere right now in the US. And we just hit a wall in this environment of being able to find either funding or a partner for the rollout. And so, while I'm, as I say, very disappointed, I've been with the company now for six years, and I came because of this HDF opportunity.

因此，雖然 HDF 在歐洲越來越受歡迎，但目前在美國卻毫無進展。在這種環境下，我們無法找到資金或合作夥伴來進行推廣。因此，正如我所說，雖然我非常失望，但我已經在這家公司工作了六年，我來到這家公司是因為這個 HDF 的機會。

I think that at some point you got to say, okay, we're succeeding in the filter business and we're just spending money again and again and again in the SRP -- on SRP through alone, and I think it's just time to take a pause. So I do hope that Nephros will rekindle that technology in the future.

我認為在某些時候你必須說，好吧，我們在過濾器業務上取得了成功，我們只是一次又一次地在 SRP 上花錢——僅在 SRP 上，我認為現在是時候暫停一下。所以我確實希望 Nephros 能夠在未來重新點燃這項技術。

But for right now, when we've promised all of you that we will get to cash flow breakeven around the middle of the year, I just don't think it's the time to be spending $150,000 or more a quarter. And if we want to do the rollout without funding it from the outside, it would be double or triple that, and we just don't have the resources.

但就目前而言，當我們向大家承諾我們將在年中左右實現現金流收支平衡時，我認為現在還不是每個季度支出 15 萬美元或更多的時候。如果我們想在沒有外部資助的情況下進行部署，那麼成本將是兩倍或三倍，而我們只是沒有資源。

So what do you have to see, Andy, to regulatory to get this back?

那麼，安迪，你需要向監管部門尋求什麼才能恢復這種狀態呢？

Well, I don't think -- well, we would have to see a better opportunity to properly reimburse a higher-cost dialysis modality. Right now, it doesn't exist. And since the treatment cost is more, nobody's doing it. So we have no market to go into. That's the problem. We think that will change. But I said that to you all three, four years ago, and I have -- we haven't seen a change yet. We'd rather not spend money while we wait for the market to change.

好吧，我不認為——好吧，我們必須找到更好的機會來適當報銷更高成本的透析方式。目前，它不存在。由於治療費用更高，所以沒有人這樣做。所以我們沒有市場可以進入。那就是問題所在。我們認為這種情況將會改變。但我在三、四年前就對你們說過了，我們還沒有看到變化。我們寧願在等待市場變化時不花錢。

Yeah. I guess run-up to this, looking back a year or so, I didn't have an inkling that this was going to unfold. It's a surprise to me.

是的。我想在這之前，回顧一年左右的時間，我並沒有意識到這會發生。這對我來說是一個驚喜。

Well, you know [can or]. We -- well, I hear what you're saying. I'm sorry that you say it's a surprise. It is a company that the SRP effort has been -- while we've been throwing our best efforts after it, after it, it has also been true that we have seen many delays and had report significant disappointments until last May when we got the clearance. And now we're -- since that time or right about that time, we've seen the market in the medical microcap space really tank and most -- and the availability of capital, all but dry up.

好吧，你知道[可以或]。我們——好吧，我聽到你在說什麼。很抱歉你說這是一個驚喜。這家公司一直在 SRP 方面做出努力——雖然我們一直在盡最大努力，但在它之後，我們也確實看到了許多延誤，並且直到去年 5 月我們得到 SRP 時才報告了嚴重的失望。清除。現在，從那時起，或者大約從那時起，我們看到醫療微型股領域的市場確實陷入困境，並且資本的可用性幾乎枯竭。

So as I said, [we're very] disappointed, but I'm not terribly surprised that we are where we are right now.

正如我所說，[我們非常]失望，但我對我們現在的處境並不感到非常驚訝。

Is there any way to capitalize upon this -- the European market?

有什麼辦法可以利用這一點——歐洲市場嗎？

Perhaps. But we're a small company, and I think that the most important thing that we can do is focus on what we know and get ourselves to profitability and to cash flow breakeven or positive cash flow and then make decisions based on what we can afford. Because right now, we don't -- we're in a situation where we need to get ourselves to profitability and meet the commitment that we've made. So that's what we're working on.

也許。但我們是一家小公司，我認為我們能做的最重要的事情就是專注於我們所知道的，讓自己實現盈利，實現現金流盈虧平衡或正現金流，然後根據我們的承受能力做出決策。因為現在，我們不這樣做——我們所處的情況是，我們需要實現盈利並履行我們做出的承諾。這就是我們正在努力的方向。

Okay. Yeah, I hear you. All right. Thanks, and wish you good luck.

好的。是的，我聽到了。好的。謝謝，祝你好運。

Thank you, Robert.

謝謝你，羅伯特。

Joseph Schuler, JAS Investors.

約瑟夫·舒勒 (Joseph Schuler)，JAS 投資者。

Hello there. Two questions, but one is SRP. Just thinking on a cash-flow basis, was there expense to net flows in the last couple of years? Obviously, the initial investment. But was there an expense in addition to that where that might be eliminated going forward?

你好呀。有兩個問題，但其中一個是 SRP。僅考慮現金流量，過去幾年的淨流量是否有費用？顯然，初始投資。但除了這些費用之外，還有哪些費用可以在未來被消除呢？

Absolutely. SRP exhausted its funds. Nephros agreed to lend it up to $1.3 million. That loan balance is now close to $1.5 million. And we've been funding SRP at a rate of about $150,000 a quarter -- $150,000 to $200,000 a quarter. And so, that will now come right out of our expenses. And I expect that Q2, just like with PDS, we were able to remove $300,000 or so of costs, I expect to remove about $150,000 or so of costs in Q2 and forward.

絕對地。 SRP 耗盡了資金。 Nephros 同意借出最多 130 萬美元。該貸款餘額目前接近 150 萬美元。我們一直以每季度 150,000 美元左右的速度為 SRP 提供資金——每季度 150,000 美元到 200,000 美元。因此，這將直接從我們的開支中支出。我預計第二季度，就像 PDS 一樣，我們能夠消除 30 萬美元左右的成本，我預計第二季度及以後能夠消除大約 15 萬美元左右的成本。

Thank you. Just since you mentioned that the $1.5 million or whatever that number is. What is the Nephros' standing and list of creditors to the degree there? Is anything left or do you feel there's nothing left on that? In other words, where -- is it a loss, or do you think a funds can come back in?

謝謝。就在你提到 150 萬美元或者無論這個數字是什麼的時候。腎病的地位和債權人名單是什麼？還剩下什麼嗎？還是你覺得什麼都沒有了？換句話說，哪裡——是損失，還是你認為資金可以回來？

No, it's a loss.

不，這是一種損失。

In the assets. Okay.

在資產中。好的。

Yeah, there are virtually no assets, except of course, the technology, the IP, the machines, which -- and so, all of that, Nephros is the sole creditor of SRP. And so, what is almost certainly going to happen is that SRP will wind down and cease to exist as a separate company. And all of its assets, including those I just mentioned, will roll into Nephros.

是的，實際上沒有任何資產，當然，除了技術、知識產權、機器，所有這些，Nephros 是 SRP 的唯一債權人。因此，幾乎可以肯定的是，SRP 將逐漸消失，不再作為一家獨立的公司存在。它的所有資產，包括我剛才提到的資產，都將滾入 Nephros。

Okay. One other question.

好的。還有一個問題。

But there won't be any cash, sorry.

但抱歉，不會有現金。

I understand. Revenues have been around $10 million a year for a few years. Where do we get out of that? Do you see that as wherever it might come from? Do you see that as a possibility in the coming year?

我明白。幾年來，每年的收入一直在 1000 萬美元左右。我們該從哪裡擺脫困境呢？你認為它可能來自哪裡嗎？您認為來年有這種可能性嗎？

Do I see growth from that $10 million of possibility?

我能從 1000 萬美元的可能性中看到增長嗎？

Yes, yes.

是的是的。

Absolutely, absolutely. We are focused on only two things. One is watching our cash burn, and two is growing that number. And so, the only place that we're investing right now is in our sales team and our sales capability. And as I said, we're not discussing our results in Q1 yet, but the first few weeks of the year have been promising to me. And so, I do expect to see that number growing this year.

絕對，絕對。我們只關注兩件事。一是看著我們的現金消耗，二是增加這個數字。因此，我們現在唯一投資的地方是我們的銷售團隊和銷售能力。正如我所說，我們還沒有討論第一季度的結果，但今年的前幾週對我來說是充滿希望的。因此，我確實預計今年這個數字將會增長。

Good luck going forward. We're rooting for you.

祝你未來好運。我們支持你。

Thank you, [Joe].

謝謝你，[喬]。

Okay. [Either].

好的。 [任何一個]。

All right, take care.

好吧，保重。

Robert Smith, Center for Performance Investing.

羅伯特·史密斯，績效投資中心。

Yeah, Andy. So can you share with us the R&D budget, which is around $1.5 million or so? How is that being spent?

是的，安迪。那麼您能與我們分享一下大約150萬美元左右的研發預算嗎？這筆錢是怎麼花的？

I don't think -- well, it's $1.5 million including SRP, and that part will go away. It's probably -- and I don't have it in front of me, but I think it's under $1 million right now on the filtration side. And it's being spent on product development and making sure that we're staying current with technology and offering the best current products to our customers. So it's a -- I think it's a pretty modest budget and it's pretty much cut as much as we can, or it certainly will be by at the end of this quarter when SRP goes away.

我不認為——好吧，包括建議零售價在內，這部分費用是 150 萬美元，而這部分將會消失。它可能是——我面前沒有它，但我認為現在過濾方面的費用不到 100 萬美元。它被用於產品開發，並確保我們與時俱進，並為我們的客戶提供當前最好的產品。所以這是一個——我認為這是一個相當適度的預算，而且我們已經盡可能地削減了預算，或者肯定會在本季度末 SRP 消失時削減。

All right. Would you say it's basically refinements? And are you working on anything that might be interesting? Not speaking about [working] in near term, but for the future.

好的。你說這基本上是改進嗎？您正在從事任何可能有趣的事情嗎？不是談論近期的[工作]，而是談論未來。

Yeah, I think we are. I do. and I can't really say very much more about it than that.

是的，我想我們是。我願意。我真的不能說更多了。

All right. I'll be on the lookout. Okay.

好的。我會留意的。好的。

Thanks, thanks, Robert.

謝謝，謝謝，羅伯特。

Yeah, you bet.

是的，你打賭。

This concludes our question-and-answer session. And the conference is also now concluded. Thank you for attending today's presentation. You may now disconnect.

我們的問答環節到此結束。會議現在也結束了。感謝您參加今天的演講。您現在可以斷開連接。