Nephros Inc (NEPH) 2024 Q3 法說會逐字稿

Good day and welcome to the Nephros Inc third quarter, 2024 financial results conference call. All participants will be in listen-only mode. Should you need assistance? Please signal a conference specialist by pressing the star key followed by zero.

大家好，歡迎參加 Nephros Inc 2024 年第三季財務業績電話會議。所有參與者將處於只聽模式。您需要幫助嗎？請按星號鍵然後按零通知會議專家。

After today's presentation, there will be an opportunity to ask questions to ask a question. You may press star then one on your telephone keypad to withdraw your question. Please press star. Then two. Please note this event is being recorded.

今天的演講結束後，將有機會提問。您可以按下電話鍵盤上的星號然後按一來撤回您的問題。請按星號。然後是兩個。請注意，此事件正在被記錄。

I would now like to turn the conference over to Karen Smith with PC G advisory. Please go ahead.

現在我想將會議交給 PC G 顧問 Karen Smith。請繼續。

Thank you, Debbie. Good afternoon, everyone and welcome to nephros' Q3 2024 earnings conference call.

謝謝你，黛比。大家下午好，歡迎參加腎臟病 2024 年第三季財報電話會議。

Thank you all for participating in nephros' third quarter, 2024 conference call. Before we begin, I would like to remind you that this call will include forward-looking statements regarding the operations and future results of Nephros. For a discussion of these forward-looking statements. Please review nephros' sec filings including forms 10-K and 10-Q which identify specific factors that may cause actual results or events to differ materially from those described in the forward-looking statements.

感謝大家參加 Nephros 2024 年第三季電話會議。在我們開始之前，我想提醒您，本次電話會議將包括有關 Nephros 的營運和未來結果的前瞻性陳述。討論這些前瞻性陳述。請查看 Nephros 的證券交易文件，包括 10-K 和 10-Q 表格，其中列出了可能導致實際結果或事件與前瞻性陳述中描述的結果或事件有重大差異的具體因素。

Factors that may affect the company's results include but are not limited to nephros' ability to successfully timely and cost effectively market and sell its products and services offerings. The rate of adoption of its products and services by hospitals and other health care 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腎臟病公司及時、經濟有效地行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採用其產品和服務的比例。其商業化努力的成功以及現有和新的監管要求對腎臟病、業務和其他經濟和競爭因素的影響。

Content of this conference call contains time sensitive information that is accurate only as of the date of the live call today. November 7th 2024. 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. Now, I would like to turn the call over to nephros' President and Chief Operating Officer, Chief Executive Officer, excuse me, Robert Banks, Robert. Please go ahead.

本次電話會議的內容包含時間敏感訊息，這些訊息僅在今天的現場通話之日準確。2024 年 11 月 7 日。除法律要求外，本公司不承擔修改或更新任何聲明以反映本次電話會議日期之後的事件或情況的義務。現在，我想將電話轉給 Nephros 的總裁兼營運長、首席執行官，對不起，我是羅伯特·班克斯 (Robert Banks)、羅伯特 (Robert)。請繼續。

Thank you, Karen and good afternoon, everyone. I appreciate you joining us today for nephros' Q3 2024 earnings call. This quarter represents a significant milestone for our company as we achieved our first profitable quarter. Since inception, I want to begin by acknowledging the hard work and dedication of the entire Nephros team who have made this achievement possible for the third quarter which ended September 30th 2024. We reported a net revenue of $3.5 million an increase of 8% over Q2 2024 but a 6% decline compared to Q3 2023.

謝謝你，凱倫，大家下午好。感謝您今天參加 Nephros 2024 年第三季財報電話會議。本季對我們公司來說是一個重要的里程碑，因為我們實現了第一個獲利季度。自成立以來，我首先要感謝整個 Nephros 團隊的辛勤工作和奉獻精神，是他們使得截至 2024 年 9 月 30 日的第三季度取得了這一成就。我們報告的淨收入為 350 萬美元，比 2024 年第二季成長 8%，但與 2023 年第三季相比下降 6%。

Despite this decline, I'm pleased to report a net income of $0.2 million compared to a net loss of $0.2 million in Q3 of last year.

儘管出現這種下降，但我很高興地報告淨收入為 20 萬美元，而去年第三季的淨虧損為 20 萬美元。

This positive shift is driven by cost management efforts and operational improvements that have helped us to reach this milestone.

這一積極轉變得益於成本管理努力和營運改進，幫助我們實現了這一里程碑。

Gross margin for the quarter was 61% compared to 59% in Q3, 2023. Reflecting improved terms with our largest supplier adjusted EBITDA for Q3 was $295,000. A significant improvement over 11,000 in the same quarter. Last year, SG&A expenses were reduced to $1.7 million from $2.1 million in Q3 2023 due to lower spot compensation and bonus accruals and quarterly revenue increased 8% over Q2 following a rebound in emergency response orders.

本季毛利率為 61%，而 2023 年第三季為 59%。反映我們與最大供應商的條款改善，第三季的調整後 EBITDA 為 295,000 美元。與同期的 11,000 相比有顯著改善。去年，由於現貨薪酬和獎金應計金額降低，銷售、一般及行政費用 (SG&A) 從 2023 年第三季度的 210 萬美元降至 170 萬美元，並且隨著緊急響應訂單反彈，季度收入比第二季度增長了 8%。

Although we continue to see some challenges in specific regions, we remain focused on mitigating reductions in programmatic reorders by strengthening customer engagement and service capabilities.

儘管我們仍然看到特定地區面臨一些挑戰，但我們仍然致力於透過加強客戶參與度和服務能力來緩解程序化重新訂購的減少。

We are making strategic advancements to ensure long term growth in Q3. We began ramping up our digital support tools for filter installation which will improve customer compliance with filter change out schedules and drive recurring revenues.

我們正在進行策略進步，以確保第三季的長期成長。我們開始加強過濾器安裝的數位支援工具，這將提高客戶對過濾器更換計畫的遵守程度並推動經常性收入。

This initiative coupled with our increased service capabilities positions us well for future growth.

這項措施加上我們增強的服務能力，為我們未來的發展奠定了良好的基礎。

Looking ahead, we are focused on expanding into new markets such as scale processing laboratories and dental practices where we see clear opportunities for our products. Additionally, we are actively exploring partnerships that will allow us to offer solutions for emerging issues like nano and microplastic contaminations.

展望未來，我們專注於拓展新市場，例如水垢處理實驗室和牙科診所，我們在這些市場看到了我們產品的明顯機會。此外，我們正在積極探索合作夥伴關係，以便為奈米和微塑膠污染等新興問題提供解決方案。

As of September 30th 2024 our cash and cash equivalents stood at $2.5 million. This is down from $4.3 million at the end of 2023.

截至 2024 年 9 月 30 日，我們的現金和現金等價物為 250 萬美元。這一數字較 2023 年底的 430 萬美元有所下降。

This reduction is primarily due to operating losses in the first half of 2024 payments of annual employee bonuses and an inventory investment in Q1.

減少的主要原因是2024年上半年的營運虧損、支付的年度員工獎金以及第一季的庫存投資。

Despite this decrease, we remain committed to maintaining financial discipline while pursuing strategic growth opportunities at the same time.

儘管有所下降，我們仍致力於維持財務紀律，同時尋求策略成長機會。

In conclusion, Q3 marks a pivotal point for net pros as we enter a new phase of profitability and operational excellence. We're excited about the future and we remain focused on delivering strong results for our stakeholders. I want to thank our investors, partners and employees for their continued support.

總而言之，隨著我們進入獲利和卓越營運的新階段，第三季標誌著淨專業人士的關鍵點。我們對未來充滿期待，並將繼續致力於為我們的利害關係人提供強勁的成果。我要感謝我們的投資者、合作夥伴和員工的持續支持。

We look forward to building on this momentum in the coming quarters. I will now turn the call over to our CFO Judy Credal for a detailed discussion on our financial performance, Judy.

我們期待在未來幾季繼續保持這一勢頭。我現在將電話轉給我們的財務長朱迪·克雷達爾 (Judy Credal)，詳細討論我們的財務業績，朱迪。

Thank you Robert. And please provide an overview of our financial performance for the third quarter of 2024.

謝謝你，羅伯特。請概述我們 2024 年第三季的財務表現。

Our third quarter net revenue was $3.5 million down 6% compared to the third quarter of 2023. As Robert alluded, this decrease reflects the decline in programmatic revenue, partially offset by an increase in emergency response revenue. The decline in programmatic revenue reflects under performance in one region and a few of our larger accounts showing slower order patterns.

我們第三季的淨收入為 350 萬美元，與 2023 年第三季相比下降了 6%。正如羅伯特所暗示的，這一下降反映了專案收入的下降，但被緊急應變收入的增加部分抵消。程序化收入的下降反映了一個地區的業績不佳以及我們的一些較大帳戶的訂單模式放緩。

Our gross margin for the third quarter of 2024 increased to 61% versus 59% in the prior year period. Reflecting improved terms with our largest supplier.

2024 年第三季的毛利率從去年同期的 59% 上升至 61%。反映出我們與最大供應商之間條款的改善。

As Robert mentioned, we achieved positive net income of approximately $200,000 in the third quarter of 2024 versus a net loss of 180,000 in the prior year period, reflecting the improved gross margins this year and a tight control of expenses. This is primarily due to reduce SG&A expenses which declined by 19% which was driven by lower stock compensation, lower bonus, accruals and lower sales commissions adjusted EBITDA improved to $295,000 in the third quarter of 2024 from 11,000 in the prior year period.

正如羅伯特所提到的，我們在 2024 年第三季實現了約 20 萬美元的正淨收入，而去年同期的淨虧損為 18 萬美元，這反映了今年毛利率的提高和對費用的嚴格控制。這主要是由於銷售、一般及行政費用減少，銷售、一般及行政費用下降了 19%，這歸因於股票薪酬減少、獎金減少、應計費用減少以及銷售佣金減少，調整後的 EBITDA 從去年同期的 11,000 美元提高到 2024 年第三季度的 295,000 美元。

Now looking at the nine months ending September 30th 2024 sales declined by 6% to $10.3 million from $11 million in the prior year period. But excluding emergency response revenue sales increased by 3%.

現在來看看截至 2024 年 9 月 30 日的九個月，銷售額從去年同期的 1,100 萬美元下降 6% 至 1,030 萬美元。但不包括緊急應變收入，銷售額成長了 3%。

Gross margins improved to 61% in the first nine months of 2024 from 58% in the prior year period. Reflecting improved pricing from our largest supplier as well as reduce shipping expenses.

2024 年頭九個月的毛利率從去年同期的 58% 提高至 61%。反映了我們最大供應商的定價改進以及運輸費用的降低。

SD and A expenses decreased by 11% in the nine months of 2024 versus the prior year period due to a decrease in bonus, accrual sales commission expense, stock compensation expense and travel expenses. And this was offset in part by an increase in salary expense.

2024 年 9 個月的 SD 和 A 費用較去年同期下降了 11%，原因是獎金、應計銷售佣金費用、股票薪酬費用和差旅費用減少。但這部分被工資支出的增加所抵消。

Net loss decreased 70% to a loss of $275,000 in the first nine months of 2024 from a loss of $921,000 in the prior year period adjusted EBITDA for the nine month period improved to $67,000 from a loss of $25,000 in the prior year period.

2024 年頭九個月淨虧損減少 70% 至虧損 275,000 美元，去年同期虧損 921,000 美元；九個月調整後的 EBITDA 從去年同期虧損 25,000 美元改善至 67,000 美元。

Our balance sheet remains strong with a cash balance of approximately $2.5 million as of September 30th 2024. This is a decrease from $4.3 million at the end of 23 mainly due to increased inventory and accounts receivable and the payments of annual bonuses as well as the decline in accounts payable simply due to timing of payments. Despite these changes, we continue to operate debt free, providing us with flexibility to invest in growth initiatives.

我們的資產負債表依然強勁，截至 2024 年 9 月 30 日，現金餘額約 250 萬美元。這比 23 年底的 430 萬美元有所減少，主要原因是庫存和應收帳款增加以及年度獎金支付，以及僅由於付款時間導致的應付帳款減少。儘管發生了這些變化，我們仍然保持無債務運營，這為我們投資成長計劃提供了靈活性。

As we look to the future, we're focused on maintaining financial discipline while investing strategically in areas that will drive long term value. This includes optimizing our product pricing, improving operational efficiencies and exploring strategic opportunities for expansion.

展望未來，我們專注於維持財務紀律，同時對能夠帶來長期價值的領域進行策略性投資。這包括優化我們的產品定價、提高營運效率和探索擴張的策略機會。

I will now turn the call to Robert for some concluding remarks. Robert.

現在我請羅伯特發表一些總結性發言。羅伯特。

Thank you Judy as we move forward. Nephros is well positioned to continue its growth trajectory by focusing on innovation, customer engagement and strategic expansion. We remain we okay, but we remain committed to providing high quality water filtration solutions that meet the evolving needs of our customers. I want to extend my gratitude to our investors, partners and the entire Nephros team for their continued support and dedication.

謝謝朱迪，我們將繼續前進。透過專注於創新、客戶參與和策略擴張，Nephros 已做好充分準備繼續保持成長軌跡。我們仍然可以，但我們仍然致力於提供高品質的水過濾解決方案，以滿足客戶不斷變化的需求。我要向我們的投資者、合作夥伴和整個 Nephros 團隊表示感謝，感謝他們的持續支持和奉獻。

We look forward to sharing more updates on our progress in the coming quarters.

我們期待在未來幾季分享更多有關我們進展的最新資訊。

This concludes our formal presentation. We will now open the floor for questions, operator. Please open the call for Q&A.

我們的正式演講到此結束。接線員，我們現在開始回答問題。請打開電話進行問答。

We will now begin the question and answer session to ask a question. You may press star. Then one on your telephone keypad. If you are using a speaker phone, please pick up your handset before pressing the keys. If at any time, your question has been addressed and you would like to withdraw your question, please press star. Then two at this time, we will pause momentarily to assemble our roster.

我們現在開始問答環節來問一個問題。您可以按星號。然後在電話鍵盤上單擊一下。如果您使用的是揚聲器電話，請在按下按鍵之前拿起聽筒。如果您的問題已得到解答，而您想撤回您的問題，請按星號。然後，在這個時候，我們會暫時停下來整理我們的名冊。

The first question comes from Jeremy Perlman with Maxim Group. Please go ahead.

第一個問題來自 Maxim Group 的 Jeremy Perlman。請繼續。

Hi, good afternoon. Thank you for taking my question. I'm on the line for Anthony Vendetti. Just you mentioned on the call that you are planning to strengthen your customer engagement to try, I guess, get back some of those reordering from the larger customers. Maybe you could talk a little bit to how you plan on doing that. What are some of your strategies for that.

嗨，下午好。感謝您回答我的問題。我是安東尼·文德蒂 (Anthony Vendetti) 的接線員。您剛才在電話中提到，您計劃加強與客戶的互動，我想，是為了從大客戶那裡重新獲得一些訂單。也許您可以稍微談談您計劃如何做到這一點。您對此採取了哪些策略？

Sure, thank you for that call. Very, very good question. The reorder or we do call programmatic business, the filters that we sell often have a three month or six month replacement cycle and customers are prompted to replace them and usually that happens at a regular pace. What we've noticed the analysis is that customers are letting those six month filters last longer by emphasizing to the customer that using the product off label and beyond its FDA cleared amount of time, they're then out of basically off label, we can kind of talk to their infection control departments and get them to comply. Often it's not intentional, they just forget that it's happening. So we're employing online tools to have the automated reminders set out so that they can be warned. Hey, it's time to change your filters. It's time to update things. In addition, we're now offering a lot of services to be able to do that for them if they don't have the manpower. So by coupling that with the sale of our filter and getting them on a contractual or longer term basis, we'll be able to help recover and prevent that filter from being used longer than it's supposed to be. So I was you know, it took us longer than we should have to come up with some of those. But it takes a while to put these technologies in place and get the company orientated to be able to support those service type requests.

當然，謝謝您的來電。非常非常好的問題。重新訂購或我們稱之為程序化業務，我們銷售的過濾器通常有三個月或六個月的更換週期，並提示客戶更換它們，通常這會以固定的速度發生。我們注意到，透過分析，客戶可以讓那些六個月的過濾器使用更長時間，我們向客戶強調，如果使用非標籤產品並且超出了 FDA 批准的時間，那麼他們基本上就超出了標籤範圍，我們可以與他們的感染控制部門交談並讓他們遵守。通常這並不是故意的，他們只是忘記了它的發生。因此，我們正在使用線上工具來設定自動提醒，以便他們能夠收到警告。嘿，是時候更換你的過濾器了。是時候更新一下了。此外，如果他們沒有人手，我們現在提供很多服務來為他們做到這一點。因此，透過將其與我們的過濾器的銷售結合起來並以合約或長期合約的方式獲得它們，我們將能夠幫助恢復並防止過濾器的使用時間超過其預期時間。所以，你知道，我們花了比應有的更長的時間來想出其中的一些方法。但需要一段時間才能將這些技術落實到位，並使公司能夠支援這些服務類型的請求。

Yes. So I think that also might have answered another of my next question. Just so just to confirm. So you, you mentioned is that that online filter tracker that you think that a beta testing in the first quarter that, that ties into this, that's going to be something that automatically will send, you know, alerts to customers that their filter is that's expiring in a month and then, or has expired and they should re order that it goes hand in hand.

是的。所以我認為這也可能回答了我的下一個問題。只是為了確認一下。所以，您提到的是，您認為第一季進行的 Beta 測試版的線上過濾器追蹤器與此相關，它將自動向客戶發送警報，告知客戶他們的過濾器將在一個月後到期，或者已經過期，他們應該重新訂購。

Correct. Correct. Yeah, we were pretty far down the path of a solution. Had some hiccups from a technology perspective, getting things to work off line, had to pivot midway through and we've been testing a new version of it 2.0 and we're very happy with how that's working out. So that's going to be what we're moving forward and pushing out to the field. But it does take some time to make sure that it works before we get it fully rolled out and have a product that we have to recall. So, so far we're very, very pleased.

正確的。正確的。是的，我們已經在解決問題的道路上走得很遠了。從技術角度來看，出現了一些小問題，無法讓事情離線運行，不得不中途轉向，我們一直在測試它的新版本 2.0，我們對它的運行情況非常滿意。這就是我們要繼續前進並推向市場的。但在我們全面推出並召回產品之前，確實需要一些時間來確保它有效。所以，到目前為止我們非常非常高興。

Is it, do you have a rough, you know, rough estimate time on when you think that would be rolled out to all your customers? Is that a, is that an end of the year or something in 21st, maybe first half, 2025?

您是否有一個粗略的估計時間，您認為什麼時候可以將其推廣到所有客戶？那是在 21 世紀末，還是 2025 年上半年？

Yeah, I think we're still aiming for Q1 next year, like we mentioned nothing previously. We will start, we've already started rolling it out to customers, be testing it, making sure everyone's happy with it. And so it's, it's a right on schedule.

是的，我認為我們仍然瞄準明年第一季度，就像我們之前提到的那樣。我們將開始，我們已經開始向客戶推出它，對其進行測試，確保每個人都對它滿意。所以，一切都照計劃進行。

Okay, great. And then just my last question is related to that new Hydro Guard ultra filter. You, you know, you put out a press release recently. What's the target market for that? And how do you think that fits in with the rest of your portfolio? Is that that complementary or is that you're a totally new addressable market?

好的，太好了。我的最後一個問題與新的 Hydro Guard 超濾器有關。您知道，您最近發布了一份新聞稿。它的目標市場是什麼？您認為這與您的其他投資組合有何關聯？這是互補的嗎？或者說你們是一個全新的可尋址市場？

Well, we it's complementary, it's somewhat of a new also, we've had opportunities for still processing and basically higher flow situations where we couldn't reach it with the existing product portfolio. So this opens up a bigger market and some of the newer markets covered under ST 108, which are becoming more and more prevalent today. So we're very excited about what that can do for us. We've been able to satisfy that need in the past, getting creative, getting things together, but it put us at somewhat of a deficiency when by the time you come up with a custom solution. So this does allow us to compete more competitively and readily with a product that's designed and made for that particular application. So yeah, that's what that brings us.

嗯，我們是互補的，它也是一種新事物，我們有機會進行靜態處理，基本上可以實現更高流量的情況，而現有的產品組合無法實現這些情況。因此，這開闢了一個更大的市場和一些 ST 108 涵蓋的較新的市場，這些市場如今變得越來越普遍。因此，我們對它能為我們帶來什麼感到非常興奮。過去，我們能夠滿足這種需求，發揮創造力，把所有東西整合在一起，但當你提出客製化解決方案時，我們就會遇到一些不足。因此，這確實使我們能夠利用為特定應用設計和製造的產品更具競爭力和更容易競爭。是的，這就是它帶給我們的。

Okay, great. That, that's great. I'm going to have to take you and thank you again for taking my questions.

好的，太好了。那，那太好了。我必須帶你去，再次感謝你回答我的問題。

Thank you.

謝謝。

Again. If you have a question, please press star, then one, the next question is from Anchor Sagger. He's a private investor. Please go ahead.

再次。如果您有問題，請按星號，然後按一，下一個問題來自 Anchor Sagger。他是一位私人投資者。請繼續。

Hey, good afternoon. Robert and Judy. Thank you for taking my questions. Nice job on the, on the profitability. I think that just shows the strength of the operating model and what's visible with higher revenue numbers. So that's great. On the, on the revenue side, can you you separate out, you know, in, in terms of, you know, if the programmatic business also declined and what the decline was. And also, I think you called out a couple of reasons that the South Central region not performing and and the reorders. And, and if you could just, you know, list out the things that you're doing to, to stop that decline.

嘿，下午好。羅伯特和朱迪。感謝您回答我的問題。在盈利能力方面做得很好。我認為這只是顯示了營運模式的優勢以及更高的收入數字所帶來的明顯優勢。這太棒了。在收入方面，您能否單獨說明一下，程序化業務是否也下降了，下降幅度是多少。而且，我認為您指出了中南部地區表現不佳和重新訂購的幾個原因。並且，如果您可以列出您正在做的事情，以阻止這種衰退。

Sure, I'll go into some detail and hopefully will answer that question. Programmatic sales which listed I mentioned previously, they've declined over same quarter last year. Well, same quarter, third quarter, last year was one of the highest quarters on record. I think it was the third, I'll have to go back and check the numbers. So coming close to that isn't too shabby of an achievement, however, it's lower than what we would expect at that same quarter in 2024 it is a cyclical product. So every six months and so based on ordering patterns, you typically have a slower month followed by a bigger month. So Q3 and in 2023 I believe it was $3.7 million. So that was a really, really high quarter. So coming close is not too bad. Now, we did increase, I believe 6% over prior quarter. So if you take programmatic versus Q2, we we are increasing there. So not too, not, not too unhappy with that result. So as long as the trajectory continues, I'm, I'm quite pleased. So I think that's the answer to how the programmatic business has performed. I did see declines in some of the regions and some customers, it's really limited to a few customers and what I've noticed and when we talked to a few of those individually, a couple of them are burning down inventory, they, they were carrying high inventories and they wanted to get that down. So, you'll see ordering patterns kick back in and, and that should reverse itself. So, not too worried about that. I don't see losses across the system to competitors. I don't see people just abandoning the nets, answer and solutions. So, so not too, not too concerned overall, just maybe ordering patterns, timing inventory reduction. Now, the performance of one of the regions I mentioned it was performance against expectations, not against the prior year or, or other things. So those aren't losses, those are just places where given the number of opportunities, patient care facilities, other update that I would have expected larger revenue and we just weren't quite seeing that. So, yeah, we're taking and, and realigned some of the support and gotten different resources capable with different technologies to be able to grow that region and, and hopefully we'll be able to report on some results on that in the coming quarter.

當然，我會詳細說明並希望能夠回答這個問題。我之前提到的程序化銷售與去年同期相比有所下降。嗯，去年同一季度，也就是第三季度，是有史以來最高的季度之一。我認為這是第三次了，我得回去檢查一下數字。因此，接近這個目標並不是一個太糟糕的成就，然而，它低於我們對 2024 年同一季度的預期，它是一種週期性產品。因此，根據訂購模式，每六個月通常會有一個較慢的月份，然後是較快的月份。因此，我認為第三季和 2023 年的收入是 370 萬美元。所以那是一個非常非常好的季度。所以接近也不算太糟。現在，我們確實成長了，我相信比上一季成長了 6%。因此，如果將程序化與第二季度進行比較，我們會發現程序化正在增加。所以這個結果，我不會太、不會太不滿意。所以只要這個軌跡繼續下去，我就很高興。所以我認為這就是程序化業務表現如何的答案。我確實看到一些地區和一些客戶的銷量有所下降，但這實際上僅限於少數客戶，當我們與其中幾個客戶單獨交談時，我注意到其中一些客戶正在消耗庫存，他們持有大量庫存，他們希望降低庫存。因此，您會看到排序模式重新開始，並且這種情況會自行逆轉。所以，不必太擔心。我沒有看到整個系統因競爭對手而遭受損失。我沒有看到人們放棄網路、答案和解決方案。所以，整體來說不是太擔心，可能只是訂購模式、時間庫存減少。現在，我提到的某個地區的表現是超出預期的，而不是與去年或其他情況相比的。所以這些都不是損失，這些只是考慮到機會數量、病人護理設施和其他更新，我本來預計會有更大的收入，但我們並沒有看到這一點。所以，是的，我們正在採取並重新調整一些支持措施，並獲得採用不同技術的不同資源來發展該地區，並希望我們能夠在下個季度報告一些結果。

I see. Okay, that's great. You know, it's it's not calling out names Robert, but I, I saw, I, I see it in the news recently. There was a facility, you know, here on the east coast. You know, which had, I think a legion outbreak, a few people died and then, you know, there was a lawsuit against that. So it's strange to see, you know, where these facilities could be just, you know, staying compliant with this filtration and save lives, but they're not. I think that goes to, you know, your response regarding the programmatic business, I think you mentioned about, you know, launching this digital filter. But in the press release, I think you mentioned also, you know, as you launch this you know, digital filter, you are also handling this by you know, service. I think you have some full service customers as well where you basically change the filters yourself or some of your partners do it. I think if you could elaborate on that because that seems like something maybe can, can, can tackle this, this programmatic side of business, you know, quickly.

我懂了。好的，太好了。你知道，這不是在喊羅伯特的名字，但是我，我看到了，我，我最近在新聞中看到了它。你知道，東海岸有一座設施。你知道，我認為那裡爆發了大規模疫情，造成數人死亡，然後，你知道，那裡發生了一起針對該疫情的訴訟。所以，奇怪的是，這些設施本來可以遵守過濾規定並挽救生命，但它們卻沒有這樣做。我認為這與你對程式化業務的回應有關，我想你提到過推出這個數位過濾器。但在新聞稿中，我想您也提到過，當您推出這個數位濾波器時，您也會透過服務來處理這個問題。我認為您也有一些全方位服務的客戶，基本上您自己或您的一些合作夥伴會更換過濾器。我認為如果你能詳細說明一下，因為這似乎可以、可以、可以快速解決這個問題，這個業務的程序化方面。

Yeah. So speaking directly, I think you're, there's two questions kind of embedded in there. The one I think you're really getting at is the service arm. That capability is one that we haven't fully executed in, in the recent past. Anyway. So getting having a team that can go out and not only sell the filter but exchange the filter track it. A lot of the entities that we're talking to, they don't have full staff of people ready to change the filter. And when they do it, teams thinking of maybe they're filter in your refrigerator or you go and then plug it, plug a new one in. Our filters are basically medical devices in most cases and you have to do a certain amount of sanitization or you're putting a clean filter in a dirty line and you're not doing yourself any favors. So the having our team service it and follow our instructions for use is really a way to make sure that they're not only compliant with how the filters are supposed to be used in getting the results they want and need to get. But also that we're tracking that when that filter gets installed and it gets changed on a regular basis. So that is, that's that's very important for us. It's important for us to figure out how to do that regularly and build the muscle and turn to be able to do that and with our partners who also have those capabilities. So we'll be looking for, continuing to strengthen either our third party network, but more importantly, our internal network as well to be able to sort those support those opportunities.

是的。所以直接說，我認為，這裡面有兩個問題。我認為你真正要說的是服務部門。近期我們尚未完全發揮這項能力。反正。因此，需要有一支團隊出去，不僅可以銷售過濾器，還可以更換過濾器並進行追蹤。我們正在交談的許多實體都沒有足夠的人員來更換過濾器。當他們這樣做時，團隊會想到也許是冰箱裡的過濾器，或者你去插上它，再插上一個新的。在大多數情況下，我們的過濾器基本上都是醫療設備，您必須進行一定程度的消毒，否則您將乾淨的過濾器放入髒管線中，這對您自己沒有任何好處。因此，讓我們的團隊對其進行維護並遵循我們的使用說明，實際上是一種確保他們不僅遵守過濾器的使用方式來獲得他們想要和需要的結果的方法。而且我們也會追蹤過濾器的安裝情況並定期進行更換。所以這對我們來說非常重要。對我們來說，重要的是弄清楚如何定期做到這一點，並鍛鍊肌肉，以便能夠做到這一點，並與同樣具有這些能力的合作夥伴一起做到這一點。因此，我們將尋求繼續加強我們的第三方網絡，但更重要的是，我們的內部網路也將繼續加強，以便能夠對這些機會進行支援。

Okay. Just, one last one.

好的。只剩最後一個了。

I think Robert, you know, coming into 2024 I think you had some higher expectations for growth. You know, obviously that didn't pan out and, and, and you know, if, if you could, you know, probably you know, comm talk about the top three initiatives that you're, you know, looking forward and, and focused on from the growth side. You know, that would be great and just one last part on this question for Judy, you know, any, any revenue growth that happens, Should we expect that it drops to the bottom line and increases the profitability?

我認為羅伯特，你知道，進入 2024 年，我認為你對成長有更高的期望。你知道，顯然這並沒有成功，而且，而且你知道，如果可以的話，你知道，可能你知道，從增長方面來說，你最期待和關注的三大舉措。你知道，那太好了，關於這個問題，我只想問朱迪最後一點，你知道，任何收入增長，我們是否應該預期它會下降到底線並提高盈利能力？

Okay. So I'll try to tell the first one. Okay. Oh no, go ahead Judy.

好的。所以我會嘗試講述第一個。好的。哦不，繼續吧，朱迪。

I'm sorry to interrupt you,

很抱歉打擾你，

please go. Oh.

請走吧。哦。

No, sorry, sorry if I get it. Yeah, appreciate the the question. So certainly, we have nice growth margins and we really think we can grow sales faster than expenses. So obviously we do expect every incremental dollar of sales to add more to the bottom line. I do want to caution you though. We did have lower because sales did not meet expectations. We did have lower sales commissions and bonus schools this year than expected. You know, which was the savings on the expense line. We certainly don't plan for that next year. So we, we hope to have, you know, full commissions and full bonuses, which again are variable and we still expect to become more profitable as we grow sales on the operating line.

不，抱歉，如果我明白的話，我很抱歉。是的，我很感謝你提出這個問題。因此，我們確實擁有良好的成長利潤率，而且我們確實認為銷售額的成長速度可以快於支出的成長速度。因此，顯然我們確實期望每一美元的銷售額增量都能為利潤帶來更多貢獻。但我確實想警告你。由於銷售額未達到預期，我們的銷售額確實有所下降。今年我們的銷售佣金和獎金學校確實低於預期。你知道，這就是費用的節省。我們明年當然不會做這樣的計畫。因此，我們希望獲得全額佣金和全額獎金，這些也是可變的，我們仍然希望隨著營運線上銷售額的成長而獲得更多利潤。

And I can tackle the first part of the question. When you say not meeting expectations, what I've learned early part in this year was there are two sources of revenue which we've often talked about the programmatic and also the emergency response.

我可以解決這個問題的第一部分。當你說沒有達到預期時，我在今年年初了解到，收入來源有兩個，我們經常談論的是程序化收入和緊急應變收入。

The part that we can control with our efforts our day to day, our core is that programmatic business and those sales have been increasing at a steady trajectory as as intended, maybe slightly lower than we expected, especially this past quarter. But overall, I'm not disappointed with that result. The emergency response which I talked to in the previous call about has disappointed, but that's not something that we can control. So we've been so looking at the top line revenue and as an aggregate of the two components of revenue and thinking about it, classifying the revenue stream overall. And I think, and I suggested before that it's probably a much better measure of how well the company is doing against competition. To look at the core and programmatic business. So from that perspective, I'm looking at three growth initiatives to keep that number going and rising into the next year, we talked about one just now with service going in and keeping track of same site sales filters that are installed and changing those out of the regular basis. That's 12, the digitization effort by tracking and knowing where the filters were land where they're installed, how they're performing. What's there all of that being recorded and online will give us analytics and be able to tell a lot more information how to serve the market and meet our customers needs.

我們可以透過日常努力來控制的部分，我們的核心是程序化業務，這些銷售額一直按照預期穩步增長，可能略低於我們的預期，尤其是上個季度。但總的來說，我對這個結果並不失望。我在上次電話中談到的緊急響應令人失望，但這不是我們能夠控制的。因此，我們一直在關注營業收入以及收入兩個組成部分的總和，並對其進行思考，對整體收入流進行分類。我認為，而且我之前也建議過，這可能是衡量公司在競爭中表現如何的更好的指標。專注於核心和程序化業務。因此，從這個角度來看，我正在考慮三個增長計劃，以使這個數字保持增長並在明年上升，我們剛才討論了其中一項服務，即提供服務並跟踪已安裝的同一站點銷售過濾器，並定期更改這些過濾器。這就是 12，透過追蹤和了解過濾器的位置、安裝位置和運行情況來實現數位化。所有這些記錄和線上資訊將為我們提供分析數據，並能夠告訴我們更多有關如何服務市場和滿足客戶需求的資訊。

A third one I would point out is going beyond patient care, patient care hospitals, burn centers, recovery emergency units. Those are our typical places where you'll find their filters which are considered medical devices, but there's a world of other opportunities out there, whether it be airports, cruise ships, large office buildings, correctional facilities, all the places where you can think that we care about, you know, micro plastic nanoplastics and other contaminants beyond the, just the pathogens all represent opportunities. So as we get better at how to serve these other markets and brand and our materials to be able to meet the needs and communicate that we hope to show growth in those areas as well.

我想指出的第三點是超越病人護理，病人護理醫院、燒傷中心、復健急診室。這些都是我們通常會使用過濾器的地方，這些過濾器被視為醫療設備，但世界上還有很多其他機會，無論是機場、遊輪、大型辦公大樓、懲教設施，所有你能想到我們關心的地方，你知道，微塑膠奈米塑膠和其他污染物，不僅僅是病原體，都代表著機會。因此，隨著我們越來越了解如何服務這些其他市場和品牌，以及我們的材料能夠滿足需求並進行溝通，我們希望在這些領域也能成長。

Okay, great.

好的，太好了。

Thank you for taking my question.

感謝您回答我的問題。

No problem.

沒問題。

The next question is from Ralph Weil with R Weil. Investment management. Please go ahead.

下一個問題來自 R Weil 的 Ralph Weil。投資管理。請繼續。

Good afternoon to both of you. You've talked in the past about Ashray and that it is suggested and the regulations and we're talking about having more teeth in the regulations.

兩位下午好。您過去曾談到過 Ashray，它是一項建議和法規，我們正在討論如何使法規更具約束力。

What, where do you stand and what do you see regarding the Ashray regulations as it affects Neros and AAA second question. And you've talked a lot about the numbers and I know you've touched upon the newer areas that you're working on. Could you possibly just be a little more specific as to what you might be doing and where you stand with the newer areas at this point in time?

您的立場是什麼？您如何看待 Ashray 法規對 Neros 和 AAA 的影響？第二個問題。您已經談了很多關於數字的問題，我知道您已經觸及了您正在研究的新領域。您能否更具體地說明您正在做什麼以及您目前在新領域的立場？

Mm okay. I'll try to answer that first. I can answer the first one, the second one on how specific on the newer areas I might struggle with, but let's see where the answer takes us.

嗯，好的。我會先嘗試回答這個問題。我可以回答第一個問題，第二個問題關於我可能遇到困難的新領域的具體情況，但讓我們看看答案會帶我們去哪裡。

So as far as Ashray Ashray 514 ST 108, these regulations guidelines, they're calling for people who conform with them to form water management committees to have emergency response plans to have basically some idea for how they will handle pathogens when problems arise. This has caused people in the say Ohio area where it had become not as important to look at that again and to adhere to a certain amount of testing if they want to keep their hospital accreditation status. So what we saw in Q3 with a little bit of rebound there towards the end of with, was partially resolved that as you see, different patient care entities in the, in that area start to now pay more attention to it and look for those programs. We're getting those calls and we're having people that are testing and we're able to respond and provide solutions for them. So, the regulations that we've mentioned and have been talking about for, you know, months ahead of this are starting to show and, and realize some increased opportunities for Afros. So that's good. And that's exciting. I'm seeing something similar in New Jersey with the regulations that are being passed there. So it's in the beginning stages and a lot of these entities do have pretty significant grace period of time to comply. So, I mean, sometimes a year plus to them as they start to do and create their own plans, we're getting calls being asked to, hey, how do we meet these standards? What can you do to help us? So that's exciting.

因此，就 Ashray Ashray 514 ST 108 而言，這些法規指南呼籲遵守這些指南的人們組成水管理委員會，制定應急響應計劃，以便在出現問題時對如何處理病原體有基本的了解。這使得俄亥俄州地區的人們不再需要再考慮這個問題，也不再需要堅持進行一定程度的測試才能維持醫院的認證資格。因此，我們在第三季末看到的問題出現了小幅反彈，部分得到了解決，正如您所見，該地區的不同患者護理實體現在開始更加關注它並尋找那些項目。我們接到了這些電話，派人進行測試，我們能夠做出回應並為他們提供解決方案。因此，我們幾個月前提到並討論過的規定開始顯現，並為非洲人帶來了更多的機會。這很好。這很令人興奮。我看到新澤西州通過的法規也有類似的情況。因此，它還處於開始階段，許多實體確實有相當長的寬限期來遵守。所以，我的意思是，有時當他們開始製定自己的計劃時，需要一年多的時間，我們會接到電話詢問，嘿，我們如何達到這些標準？您能為我們做些什麼？這很令人興奮。

Now the second part of your question help again, you said new. Yes, please repeat that second part for me. I was having a little trouble understanding what you were trying to ask.

現在你的問題的第二部分再次提供幫助，你說的是新的。是的，請為我重複第二部分。我有點不懂你想問什麼。

Could you just, I mean, you've talked a lot about the numbers, the SG&A the inventories, etcetera and you both talked about that. But I, I guess investors would like to hear more about the newer initiatives and newer programs that you have, whether it be, and you, you did mention dental and you mentioned the instruments and nano microplastics. Could you elaborate, elaborate a little more on, you know, what you've been doing and how long that might take? And, and you know what it, what it may mean to the company? I mean, I guess that's the future and people, you know, I, and I guess others are looking forward to where the new growth is going to come from besides your pro problematic business and your emergency business.

你能不能，我的意思是，你已經談了很多關於數字、銷售、一般和行政費用、庫存等等，你們都談到了這些。但是，我想投資者希望聽到更多有關您的新舉措和新項目的信息，無論是，您提到了牙科，也提到了儀器和納米微塑料。您能否詳細說明您一直在做什麼以及可能需要多長時間？而且，您知道這對公司意味著什麼嗎？我的意思是，我猜這就是未來，人們，你知道，我，我想其他人都在期待除了你的專業問題業務和緊急業務之外，新的增長將從何而來。

I think you've been programmatic business but I get it the, the new products, one of the things I have gotten from investors that they do want to know what's coming, what's new, what's exciting, how is that going to take the into the next quarter into the next year? And that's one of the reasons you've seen and we'll continue to see more of these press releases. We did one on the new product, the Hydro Card and in the press release, it talks about markets that we're going to be targeting with that product, which happens to line up very nicely with some of the regulations that are coming out and you've seen some another press release on disaster recovery. So being able to respond when there is emergencies like the hurricanes, we're getting calls from customers that didn't know who Neri was before and trying to book it how we not only take their emergency response but let them know that this is also a solution that can be used in line and ongoing. So again, those are going to be some of the growth areas, converting the new customers into emergency response into programmatic. You're going to see more activity like that. Press releases are just letting us let letting the investors know what's coming and where and where we're seeing significant growth and in opportunities in the coming weeks and months. So stay tuned for that. We hear you, we know that it's important to let our investors know where we're going and we're excited to start sharing some of those things. We've got a pretty robust pipeline of, of items in our R&D pipeline that we're going to be just accelerating just as quick as possible. So stay tuned is what I would say to that.

我認為你們一直從事程序化業務，但我明白，新產品，我從投資者那裡得到的答案之一是，他們確實想知道接下來會發生什麼，有什麼新鮮事，有什麼令人興奮的事情，這些將如何影響下個季度和明年？這就是您所看到的原因之一，我們將繼續看到更多此類新聞稿。我們對新產品 Hydro Card 做了一次發布，在新聞稿中，我們談到了該產品的目標市場，這恰好與即將出台的一些法規相吻合，而且您還看到了另一份關於災難恢復的新聞稿。因此，當發生颶風等緊急情況時，我們能夠做出反應，我們會接到以前不知道 Neri 是誰的客戶的電話，並嘗試預訂它，我們不僅會採取他們的緊急響應，還會讓他們知道這也是一種可以在線和持續使用的解決方案。所以，這些將成為一些成長領域，將新客戶轉化為緊急回應，轉化為程序化。你會看到更多類似的活動。新聞稿只是讓我們讓投資者了解未來幾週和幾個月將會發生什麼，以及我們將在哪裡看到顯著的成長和機會。因此請繼續關注。我們聽到了您的聲音，我們知道讓投資者了解我們的發展方向非常重要，我們很高興開始分享其中的一些事情。我們的研發管道中擁有相當強大的專案管道，我們將盡快加速其發展。所以我想說的是，請繼續關注。

Could you come at about the commercial beverage business and what the status is of that and whether you know, whether any changes being made there to accelerate that or do anything different.

您能否談談商業飲料業務及其現狀，以及您是否知道是否有任何變化來加速這一進程或採取任何不同的措施。

So the commercial business as was I guess highlighted early Q1 last year had big plans and, and robust goals that did not meet expectations. We are still well into that space. We are still rolling out through our partners tractor by way of Donna start to reach all the chipotle. So those change outs are happening, not seeing the accelerated growth as I would have liked to but it was never supposed to be a huge chunk of our existence anyway. So, it's, it's piping along. Dinosaur is still a great partner of ours and we're always looking for additional ways to expand that.

因此，正如我所猜測的，去年第一季初商業業務有宏偉的計劃和宏偉的目標，但並未達到預期。我們仍然處於這個領域的前沿。我們仍然透過唐娜 (Donna) 的合作夥伴拖拉機開始到達所有的 chipotle。所以這些變化正在發生，並沒有看到我所希望的加速成長，但無論如何，這本來就不應該成為我們生存的很大一部分。所以，它正在順利運作。恐龍仍然是我們的重要合作夥伴，我們一直在尋找其他方式來擴大這種合作關係。

Okay. Thank you.

好的。謝謝。

Thank you.

謝謝。

This concludes our question and answer session.

我們的問答環節到此結束。

This also concludes our conference. Thank you for attending today's presentation. You may now disconnect.

我們的會議也到此結束。感謝您參加今天的演講。您現在可以斷開連線。