Solesence Inc (SLSN) 2025 Q2 法說會逐字稿

Good day. Thank you for standing by. Welcome to the Solesence second-quarter 2025 conference call. (Operator Instructions) Today's call is being recorded. During this call, management will make statements that include forward-looking statements within the meaning of the federal securities laws, which are pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995.

再會。感謝您的支持。歡迎參加 Solesence 2025 年第二季電話會議。（操作員指示）今天的通話正在錄音。在本次電話會議中，管理階層將根據 1995 年《私人證券訴訟改革法案》的安全港條款，做出包括聯邦證券法所定義前瞻性聲明在內的聲明。

The conference call may contain statements that reflect the company's current beliefs and a number of important factors could cause actual results for future periods to differ materially from those stated on this call. These important factors include, without limitation, a decision of the customer to cancel purchase order or supplies, agreement, demand for and acceptance of the company's personal care ingredients, advanced materials and formulated products, changes in development and distribution relationships, the impact of competitive products and technology, possible disruption in commercial activities occasioned by public health issues, terrorist activity, an armed conflict and other risks indicated in the company's filings with the Securities and Exchange Commission.

電話會議可能包含反映公司當前信念的聲明，並且許多重要因素可能導致未來期間的實際結果與本次電話會議所述的結果有重大差異。這些重要因素包括但不限於客戶決定取消採購訂單或供應、協議、對公司個人護理成分、先進材料和配方產品的需求和接受、開發和分銷關係的變化、競爭產品和技術的影響、公共衛生問題、恐怖活動、武裝衝突以及公司向美國證券交易委員會提交的文件中指出的其他風險可能造成的商業活動中斷。

Except as required by federal securities laws, the company undertakes no obligation to update or revise these forward-looking statements to reflect new events, uncertainties or other contingencies.

除聯邦證券法要求外，本公司不承擔更新或修改這些前瞻性聲明以反映新事件、不確定性或其他意外情況的義務。

I'll now hand the conference over to your speaker, Mr. Jess Jankowski, President and CEO.

現在我將會議交給發言人、總裁兼執行長傑斯·揚科夫斯基先生。

Thank you, Daniel. Good afternoon, and thanks to all of you who have joined our call today. Also joining me on today's call is Kevin Cureton, our Chief Operating Officer. I'll begin with a summary of our second quarter results and a business update. Kevin will then discuss our operational initiatives, then we'll take your questions.

謝謝你，丹尼爾。下午好，感謝今天參加我們電話會議的所有人。參加今天電話會議的還有我們的營運長 Kevin Cureton。我將首先總結我們的第二季業績和業務更新。然後，凱文將討論我們的營運舉措，然後我們將回答您的問題。

I'm pleased to report we delivered a strong second quarter, both commercially and operationally. It truly was a total team effort that resulted in a sharp increase in revenue sequentially and annually. I'm proud of what we accomplished this quarter and want to use this opportunity to thank our dedicated team. I would like to remind our listeners that the second quarter is typically our seasonally strongest quarter. This is due to the advanced sunscreen orders for summer.

我很高興地報告，我們第二季在商業和營運方面都表現強勁。這確實是一個整個團隊的努力，導致收入連續和每年大幅增長。我為我們本季所取得的成就感到自豪，並想藉此機會感謝我們敬業的團隊。我想提醒我們的聽眾，第二季通常是我們季節性最強勁的季度。這是由於夏季防曬霜訂單提前。

This made it critical that we executed at the highest level to effectively manage the increased volume load. This exceptional performance has not only solidified our customer relationships, but also positioned us as well for repeat orders.

這使得我們必須以最高水準執行才能有效管理增加的容量負荷。這項卓越的表現不僅鞏固了我們與客戶的關係，也為我們贏得了回頭訂單。

Taking a step back, I'd like to highlight some of our key corporate updates that took place during the quarter. At the start of the quarter, we uplisted our common shares on the NASDAQ, a major milestone for Solesence and our valued shareholders. As we discussed on our first quarter call, listing on NASDAQ is important because it can deepen our visibility within the investment community, increase our liquidity and deliver greater value to our shareholders and other stakeholders.

回顧一下，我想強調本季我們公司發生的一些重要更新。本季初，我們將普通股在納斯達克上市，這對 Solesence 和我們尊貴的股東來說是一個重要的里程碑。正如我們在第一季電話會議上討論的那樣，在納斯達克上市非常重要，因為它可以加深我們在投資界的知名度，提高我們的流動性，並為我們的股東和其他利益相關者帶來更大的價值。

We're excited to be a NASDAQ-listed company and look forward to many future investor engagement opportunities. Since we listed on NASDAQ, we were added as a member of the broad market Russell 3000 and Small-Cap Russell 2000 indices. Inclusion on these highly visible indices further enhances our market ability by opening us up to a wider range of institutional investors.

我們很高興成為納斯達克上市公司，並期待未來有許多投資者參與的機會。自從我們在納斯達克上市以來，我們就被納入了大盤羅素 3000 指數和小型股羅素 2000 指數。納入這些備受矚目的指數將使我們向更廣泛的機構投資者開放，從而進一步增強我們的市場能力。

These significant achievements underscore our commitment to maximizing shareholder value and expanding our presence within the financial markets. During the quarter, we also amended our existing loan agreements to increase our borrowing capacity to further support our growth initiatives.

這些重大成就凸顯了我們致力於最大化股東價值和擴大我們在金融市場的影響力的承諾。在本季度，我們也修改了現有的貸款協議，以提高我們的借貸能力，進一步支持我們的成長計畫。

As Kevin will discuss in greater detail shortly, we not only enhanced our operational efficiencies during the quarter, but also restructured our debt facilities to ensure that we have the financial strength to invest in our future.

正如凱文稍後將詳細討論的那樣，我們不僅在本季提高了營運效率，而且還重組了債務結構，以確保我們擁有投資未來的財務實力。

Let's turn to an update on our second quarter financial results in approximate numbers. Revenue for the quarter was $20.4 million, representing an increase of 56% year-over-year. It was a record quarter for Solesence, driven by the sales of our consumer products to our largest customers, including our new partner, and of course, Colorescience. These results reflect the continued strength of our commercial execution and market demand for our products.

讓我們以近似數字的形式來更新我們第二季的財務表現。本季營收為 2,040 萬美元，年增 56%。這是 Solesence 創紀錄的一個季度，這得益於我們向最大客戶（包括我們的新合作夥伴，當然還有 Colorescience）銷售消費產品。這些結果反映了我們商業執行力的持續強勁以及市場對我們產品的需求。

We're also pleased with the improvement in our profitability in the second quarter as we successfully navigated through the one-time production start-up costs related to the first quarter launch of a new product line by an exciting new brand partner.

我們對第二季度盈利能力的提高也感到高興，因為我們成功地解決了與第一季由一個令人興奮的新品牌合作夥伴推出的新產品線相關的一次性生產啟動成本。

Further, as expected, we've had no recurring production issues related to this new partner. Second quarter gross profit was up 55% at $5.9 million compared to $3.8 million for the same period in 2024. The gross profit margin was 29% for both periods. Notably, gross margins expanded by 6 percentage points from the first quarter of 2025.

此外，正如預期的那樣，我們沒有遇到與這個新合作夥伴相關的反覆出現的生產問題。第二季毛利成長 55%，達到 590 萬美元，而 2024 年同期為 380 萬美元。兩個期間的毛利率均為29%。值得注意的是，毛利率較2025年第一季擴大了6個百分點。

Net income for the second quarter was $2.7 million compared to net income of $900,000 for the same period in 2024. Net income in the second quarter of '25 benefited from approximately $1.2 million in net credits plus related interest from the federal government's employee retention credit program, which we applied for in 2022.

第二季淨收入為 270 萬美元，而 2024 年同期淨收入為 90 萬美元。25 年第二季的淨收入受惠於我們於 2022 年申請的聯邦政府員工保留信貸計畫的約 120 萬美元淨信貸和相關利息。

This was a nice boost to our cash position. As pioneers in bringing industry-leading, award-winning protective beauty solutions to leading brands globally, our mission, delivering joy is embedded in our work culture. We honor this mission through our commitment to continually elevate our product offerings and offer outstanding performance.

這對我們的現金狀況有很大的提升。作為向全球領先品牌提供業界領先、屢獲殊榮的防護美容解決方案的先驅，我們的使命——傳遞快樂——已融入我們的工作文化中。我們致力於不斷提升我們的產品供應並提供卓越的性能，以履行這項使命。

In doing so, we are transforming skin care and beauty products that protect, nourish and celebrate every skin tone, type and identity. Our product advancements were on full display at the 22nd edition of Cosmoprof North America held in Las Vegas two weeks ago. For those new to our company, Cosmoprof North America is the leading business-to-business beauty trade show in the Americas and the single most important networking opportunity in the US for all sectors of the global beauty industry. It's here where we showcase our novel products and unveil new technologies, while forging new relationships and partnerships with leading brands globally.

透過這樣做，我們正在改變護膚和美容產品，以保護、滋養和適應每種膚色、類型和身分。兩週前，我們的產品進步在拉斯維加斯舉行的第 22 屆北美美容展上得到了充分展示。對我們公司的新人來說，北美美容展是美洲領先的 B2B 美容貿易展，也是美國全球美容產業所有領域最重要的交流機會。在這裡，我們展示我們的新產品並推出新技術，同時與全球領先品牌建立新的關係和夥伴關係。

We really shine at Cosmoprof. At this year's event, we were excited to demonstrate a new white label product that was featured in CosmoTrends, which is a widely circulated report that provides early insight into the most influential product ingredient and consumer behavior trends shaping the global beauty market. Our new product, Color Ninja Correcting Cream SPF 50+ is developed to cater to those consumers seeking both anti-aging and sun care products tailored towards sensitive skin. Infused with our patented ingredient, Kleair, this color correcting cream promotes skin longevity, while offering a perfected skin finish that counteracts redness.

我們在 Cosmoprof 上確實大放異彩。在今年的活動中，我們很高興展示了一款在 CosmoTrends 中亮相的全新白標產品，CosmoTrends 是一份廣為流傳的報告，它提供了對影響全球美容市場的最具影響力的產品成分和消費者行為趨勢的早期洞察。我們的新產品 Color Ninja Correcting Cream SPF 50+ 專為滿足那些尋求針對敏感肌膚的抗衰老和防曬產品的消費者的需求而開發。這款色彩校正霜融入了我們專利的成分 Kleair，可延長皮膚壽命，同時提供完美的皮膚效果，抵消紅腫。

Additionally, we exhibited two new skin health technologies that we believe will further support our future growth initiatives. As a recognized leader in the beauty industry, we continue to strengthen our foundation for growth and evolve our technology to adapt to a rapidly changing demand environment. It's our relentless commitment to scientific excellence and innovation that sets us apart, enabling us to deliver on our mission. We look forward to sharing further technology updates, product developments and new launches in the months ahead.

此外，我們還展示了兩種新的皮膚健康技術，我們相信這將進一步支持我們未來的成長計劃。作為美容行業公認的領導者，我們不斷加強成長基礎並改進技術以適應快速變化的需求環境。我們對科學卓越和創新的不懈承諾使我們脫穎而出，並使我們能夠完成我們的使命。我們期待在未來幾個月分享進一步的技術更新、產品開發和新產品發布。

At this time, I'll turn the call over to Kevin Cureton, our Chief Operating Officer, to share an update of our progress and outlook. Kevin?

現在，我將把電話轉給我們的營運長 Kevin Cureton，分享我們的最新進展和前景。凱文？

Thanks, Jess. And as always, I'd like to begin with thanking our amazing team for their tireless commitment and demonstrating through our results, their ability to consistently deliver solid performances for our investors, our brand partners and for ourselves. We are pleased to generate another quarter of record revenues and unit volumes shipped.

謝謝，傑西。像往常一樣，首先我要感謝我們出色的團隊，感謝他們孜孜不倦的承諾，並通過我們的業績證明了他們能夠為我們的投資者、品牌合作夥伴和我們自己持續提供穩健的業績。我們很高興再次創下季度營收和出貨量的新高。

This resulted from our ability to successfully ramp up inventory production earlier in the year in order to meet a higher level of customer orders during our seasonally strongest quarter. Importantly, we not just grew, but grew profitably as evidenced by our increase in EBITDA, which expanded to $3.5 million in the second quarter, up from $1.4 million in the year ago period.

這是因為我們能夠在今年稍早成功提高庫存產量，以便在我們季節性最強勁的季度滿足更高水準的客戶訂單。重要的是，我們不僅實現了成長，而且獲利也實現了成長，這從我們的 EBITDA 成長就可以看出，第二季我們的 EBITDA 從去年同期的 140 萬美元增至 350 萬美元。

Overall, for the quarter, shipment volume increased 102% and production volume increased 127% compared to the year ago period. These increases are a testament to our team's efforts to successfully work through large order quantities on time and produce high-quality solutions for our customers. I'd also like to highlight that we continue to receive new orders from our new brand partner from the first quarter in which we resolved all production issues associated to that account. This shows our unyielding dedication to our work that customers equate to the Solesence brand. While improving manufacturing execution, we continued efforts in rebalancing our inventory levels.

總體而言，本季的出貨量與去年同期相比成長了 102%，產量增加了 127%。這些成長證明了我們的團隊努力按時成功完成大量訂單並為客戶提供高品質的解決方案。我還想強調的是，從第一季開始，我們繼續收到新品牌合作夥伴的新訂單，我們解決了與該帳戶相關的所有生產問題。這顯示了我們對工作的不懈奉獻，客戶將其等同於 Solesence 品牌。在提高製造執行力的同時，我們繼續努力重新平衡庫存水準。

During the quarter, we reduced inventory levels by approximately $2 million or about 9.5% of the inventory level we held at the end of Q1. Our goal remains to reset inventory levels and mix so that they are fully aligned with our growth plans.

在本季度，我們將庫存水準減少了約 200 萬美元，約佔第一季末庫存水準的 9.5%。我們的目標仍然是重新設定庫存水準和組合，以使其與我們的成長計劃完全一致。

On our Q3 call, we will share more specifics about our progress here. Our improved manufacturing execution also yielded lower overall labor expenses as these were reduced as a percentage of revenue by 4 percentage points during the quarter as compared to Q1 2025. Our investments in increased scale and automation are starting to achieve the expected payoff. So over the next few quarters, we expect further cost reductions, which ultimately will raise our overall gross margins to be in line with what a technology-driven company like ourselves should achieve.

在我們的第三季電話會議上，我們將分享更多有關我們進展的細節。我們改進的製造執行也降低了整體勞動成本，因為與 2025 年第一季相比，本季度這些成本佔收入的百分比降低了 4 個百分點。我們在擴大規模和自動化方面的投資開始獲得預期的回報。因此，在接下來的幾個季度中，我們預計成本將進一步降低，這最終將提高我們的整體毛利率，以符合我們這樣的技術驅動型公司應實現的目標。

Now turning to the broader macroeconomic environment. Solesence is a well-diversified business with brand partners spanning various skin care, color cosmetics and sun care categories as well as those operating in the prestige and mass markets. We believe our broad market mitigates many of the effects of macroeconomic conditions if they were to weaken. Having said that, we anticipate demand to slow in the second half of 2025 as tariffs affect global purchasing decisions and consumer buying habits.

現在轉向更廣泛的宏觀經濟環境。Solesence 是一家多元化企業，其品牌合作夥伴涵蓋各種護膚品、彩妝和防曬產品類別，以及高端和大眾市場。我們相信，如果宏觀經濟狀況減弱，我們的廣大市場可以減輕其帶來的許多影響。話雖如此，我們預計 2025 年下半年需求將放緩，因為關稅會影響全球購買決策和消費者購買習慣。

This will likely have an impact on our revenues, but we are still projecting a record revenue year. On the expense side of the equation, we also expect a muted impact to our packaging component costs. However, as stated on our last call, we do anticipate that we will be able to pass all of the new tariff expenses through without adversely affecting our margins. We will continue to monitor this situation closely. In addition to our strong commercial and operational execution, as Jess mentioned, we enhanced our financial flexibility to support our future growth initiatives.

這可能會對我們的收入產生影響，但我們仍然預計今年的收入將創歷史新高。在費用方面，我們也預期對包裝組件成本的影響不大。然而，正如我們上次電話會議所述，我們確實預計能夠轉嫁所有新的關稅費用，而不會對我們的利潤率產生不利影響。我們將繼續密切關注這一情況。正如傑西所提到的，除了強大的商業和營運執行力之外，我們還增強了財務靈活性，以支持我們未來的成長計畫。

In May, we amended our loan agreements to increase borrowing capacity from $14.2 million to $23 million and extended maturities to April 30, 2027. This expanded financial flexibility is crucial for executing our objectives, allowing for favorable raw material procurement, improved lead times for product launches and stronger support of our brand partners.

5 月份，我們修改了貸款協議，將借款額度從 1,420 萬美元增加到 2,300 萬美元，並將期限延長至 2027 年 4 月 30 日。這種擴大的財務靈活性對於實現我們的目標至關重要，可以實現有利的原材料採購、縮短產品發布的準備時間並為我們的品牌合作夥伴提供更強大的支援。

Taking a 30,000-foot view, we are now better positioned to scale operations and broaden the scope and depth of the type of offerings we present to our brand partners, all of which is reflected in the strong confidence of our finance partners. We really appreciate their continued support.

從 30,000 英尺的高度來看，我們現在更有能力擴大營運規模並拓寬我們向品牌合作夥伴提供的產品類型的範圍和深度，所有這些都反映在我們金融合作夥伴的強大信心上。我們非常感謝他們持續的支持。

I'll now turn it back to Jess. Jess?

我現在將其交還給傑西。傑西？

Thanks, Kevin. Looking ahead, we anticipate moderating demand levels based on softer macroeconomic conditions. While we continue to receive reorders and exceed client expectations for our beauty care solutions, the combination of typical seasonality, longer brand purchasing decision processes and an uncertain tariff environment will likely have an impact on our top line for the second half of 2025.

謝謝，凱文。展望未來，我們預計，由於宏觀經濟條件疲軟，需求水準將會放緩。雖然我們繼續收到重新訂單並超越客戶對我們的美容護理解決方案的期望，但典型的季節性、更長的品牌採購決策流程和不確定的關稅環境等因素可能會對我們 2025 年下半年的營收產生影響。

Our shipped and open orders are currently in excess of $60 million compared to about $50 million in the second quarter of 2024 and $45 million when we last reported in May. For those listeners who are new to Solesence, this metric refers to the total value of customer orders that we've either already shipped or are still awaiting fulfillment.

我們目前的已出貨和未結訂單超過 6,000 萬美元，而 2024 年第二季約為 5,000 萬美元，5 月我們上次報告時為 4,500 萬美元。對於剛接觸 Solesence 的聽眾來說，此指標是指我們已經出貨或仍在等待出貨的客戶訂單的總價值。

It represents a snapshot into our business, which we believe helps investors better understand current demand trends. While we navigate through this expected choppy market in the second half of '25, I would like to highlight three reasons why we're confident in our long-term prospects.

它代表了我們業務的快照，我們相信它可以幫助投資者更好地了解當前的需求趨勢。當我們在 2025 年下半年度過這個預期的動盪市場時，我想強調我們對長期前景充滿信心的三個原因。

First, leveraging our patented technology, unique performance products and regulatory expertise, our specialized formulations for skin health, sun care and color cosmetics position us at the forefront of the beauty market. Our ability to cater to both prestige and mass market brands is further amplified by our diversification across various beauty segments. As the preferred CDMO for top brands, we constantly innovate with new technologies to retain our pole position, giving us an edge over the competition.

首先，利用我們的專利技術、獨特的性能產品和監管專業知識，我們針對皮膚健康、防曬和彩色化妝品的專門配方使我們處於美容市場的前沿。我們在各個美容領域的多元化經營進一步增強了我們滿足高端品牌和大眾市場品牌需求的能力。作為頂級品牌的首選 CDMO，我們不斷創新新技術以保持領先地位，從而在競爭中佔據優勢。

Second, we have an impressive roster of loyal leading brand customers, which we do not take for granted. These brands such as BASF, Colorescience, Tatcha, Credo and others appreciate our differentiated offerings. They know that we're adding to their customers' confidence, self-expression and well-being. Our high brand retention rates ensure recurring revenue and sustainable growth. Furthermore, we are relentless in meeting the specific demands of our customers.

其次，我們擁有一群忠誠的領先品牌客戶，我們不會認為這是理所當然的。BASF、Colorescience、Tatcha、Credo 等品牌都對我們差異化的產品表示讚賞。他們知道我們正在增強客戶的信心、自我表達能力和幸福感。我們較高的品牌留任率確保了經常性收入和永續成長。此外，我們堅持不懈地滿足客戶的特定需求。

As we detailed last quarter, we perfected the delivery for a new multi-SKU product launch with a new brand partner earlier this year. Despite the start-up challenges we shared, this key brand partner has now placed a series of future orders. We mentioned last time that these challenges helped to build the relationship with this brand and follow-on orders are commercial proof.

正如我們上個季度所詳述的那樣，今年早些時候，我們與新的品牌合作夥伴一起完善了新的多 SKU 產品發布的交付。儘管我們共同面臨創業挑戰，但這位重要的品牌合作夥伴現在已經下了一系列未來訂單。我們上次提到，這些挑戰有助於與該品牌建立關係，後續訂單就是商業證明。

And third, we have rightsized our operations and improved our financial flexibility, giving us added capability to not only invest, but also scale for growth. Much of the work associated with streamlining our operations occurred in late Q2 and early Q3.

第三，我們調整了營運規模，提高了財務靈活性，使我們不僅能夠進行投資，而且能夠擴大成長規模。與精簡營運相關的大部分工作都發生在第二季末和第三季初。

And as a result, we are well positioned to expand our gross margin and drive stronger EBITDA performance, which will be more evident throughout the second half of the year. We work with several brands that do a great job in conceptualizing compelling concepts that drive the initial consumer purchase. The challenge and the opportunity are translating that excitement into second and third purchases. This is where Solesence breaks through and makes a difference. By creating loyalty with consumers, our patent-protected products live up to their expectations.

因此，我們有能力擴大毛利率並實現更強勁的 EBITDA 業績，這將在今年下半年更加明顯。我們與多個品牌合作，這些品牌在概念化引人注目的概念以推動消費者的初始購買方面做得非常出色。挑戰和機會正在將這種興奮轉化為第二次和第三次購買。這就是 Solesence 取得突破並有所作為的地方。透過建立消費者忠誠度，我們的專利保護產品不辜負他們的期望。

That's the part that's difficult for other brands, those brands not working with Solesence to replicate. It reinforces our strong competitive position, which drives our long-term value creation. With three proprietary technology platforms, we are well positioned to generate continued growth that we anticipate will happen at a multiple of the industry's current growth rate.

這對於其他品牌（那些未與 Solesence 合作的品牌）來說很難複製。它增強了我們強大的競爭地位，推動了我們的長期價值創造。憑藉三個專有技術平台，我們有能力實現持續成長，預計成長速度將是該行業當前成長率的數倍。

Now before we open the call for your questions, I'd like to share a brief update on our Chief Financial Officer search. We've been actively engaged in the process and are very pleased with the caliber of candidates we've interviewed. We're at a point where we expect to make an announcement regarding our new CFO soon.

現在，在我們開始回答大家的提問之前，我想先簡單介紹一下我們尋找財務長的最新情況。我們積極參與了這個過程，並對我們面試過的候選人的品質感到非常滿意。我們預計很快就會宣布有關新任財務長的消息。

Now we'd be happy to take some questions. Afterwards, I'll offer a few closing comments. Daniel, please open the call for Q&A.

現在我們很樂意回答一些問題。之後，我將發表一些結束語。丹尼爾，請開始問答環節。

(Operator Instructions)

（操作員指示）

James Liberman, America Trust Investment Services.

詹姆斯‧利伯曼，美國信託投資服務公司。

Thank you. This was terrific results. I'm really impressed that you were able to have revenues of over $20 million for the quarter. It shows a great ability to scale. And I'm sure with that scaling, there are a lot of costs and challenges along the way. And you gave some indication that the profit margins could be starting to improve going forward as you've met certain goals. Can you give a little bit more color to how we might look at that playing out over the year?

謝謝。這是非常棒的結果。你們本季的營收能夠超過 2000 萬美元，這令我印象深刻。它展現出強大的擴展能力。我確信，隨著規模的擴大，一路上會有很多成本和挑戰。您也表示，隨著您實現某些目標，利潤率可能會開始提高。您能否更詳細地介紹一下我們如何看待這一情況在未來一年的發展？

Hi, Jim, Certainly. I think over the year, what you'll see is we were -- as you know or as the group knows that has listened to these calls, we had some turmoil in Q1 in kind of making sure that launch got perfected and we put in a lot of resources to do that. We made absolutely sure that we service that customer and their launch went out without a hitch.

嗨，吉姆，當然可以。我認為，在這一年中，你會看到我們——正如你所知，或者正如聽取了這些呼籲的小組所知，我們在第一季度經歷了一些動盪，以確保發布完美，我們投入了大量資源來做到這一點。我們絕對確保為該客戶提供服務，並確保他們的發布順利進行。

We also probably built up more inventory than we would have just to make sure that not only can we service that customer, but that the other customers that we weren't focused on that heavily were also being taken care of. And what's happening as a result now, as we make the business more efficient, we're realizing through all that production, and that's the very high-volume production.

我們可能還建立了比原來更多的庫存，以確保我們不僅可以為該客戶提供服務，而且還可以照顧到其他我們沒有重點關注的客戶。現在的結果是，隨著我們提高業務效率，我們透過所有的生產實現了大量生產。

We got some efficiencies through some of the lines that we've put in over the years that we were waiting for the opportunity to have that kind of volume to kind of do almost like a shakedown cruise to make sure that we could do it, we can get it there, and that gave us the confidence to kind of change the approach towards some of our manufacturing going forward. And we think we'll see more of that becoming evident in the last half.

我們透過多年來投入的一些生產線實現了一定的效率，我們一直在等待機會實現這種產量，就像一次試航一樣，以確保我們能夠做到，能夠到達那裡，這給了我們信心，讓我們在未來改變一些製造方式。我們認為，下半年我們會看到更多這樣的情況。

I'll hand it over to Kevin for a little more color there given his expertise here.

鑑於凱文的專業知識，我會把它交給他，讓他提供更多細節。

Thanks, Jess. And Jess hit on the nail on the head, the button, what something. But no, he hit the point there, Jim, and it's nice to hear from you. The real opportunity for us through what we learned in the first quarter was how we can better optimize the utilization of our lines and therefore the labor that is used on those lines. We actually have been able to improve that in second quarter and we expect that we'll see even better and more improvements as we get through the rest of this year.

謝謝，傑西。傑斯說到了點子上，按鈕，什麼意思。但不，他確實說到重點了，吉姆，很高興收到你的來信。透過第一季的經驗，我們獲得的真正機會是如何更好地優化生產線的利用率以及生產線上使用的勞動力。事實上，我們已經能夠在第二季改善這一點，我們預計，在今年剩餘時間裡，我們將看到更好、更多的改進。

We also, through that process, was able to do something very important and that was to implement improvements in our processes to achieve first-time prime so that we make things right the first time, that in and of itself helps to improve your efficiency and lower your cost. So those couple of items are really at the heart of where we expect to see some nice improvements in our gross profit margins as we go forward over the next few quarters.

透過這個過程，我們也能夠做一些非常重要的事情，那就是對我們的流程進行改進，以實現一次性成功，以便我們第一次就把事情做好，這本身有助於提高您的效率並降低您的成本。因此，這幾個項目確實是我們預計未來幾季我們的毛利率將大幅提升的核心。

(Operator Instructions) I'm showing no further questions at this time. I would now like to turn it back to Jess Jankowski for closing remarks.

（操作員指示）目前我沒有其他問題。現在我想請傑西·揚科夫斯基 (Jess Jankowski) 作結語。

Thank you, Daniel. Thank you for your questions. And to all those who took the time to join us today, thank you for your time. We remain confident in our long-term prospects, driven by our cutting-edge patented technology and specialized formulations that position us at the forefront of the beauty care market. Our ability to serve both prestige and mass market brands, coupled with our relentless innovation and position as a preferred CDMO, gives us a distinct competitive edge.

謝謝你，丹尼爾。謝謝您的提問。感謝今天抽出時間參加我們會議的所有人。我們對我們的長期前景充滿信心，這得益於我們尖端的專利技術和專業配方，這些配方使我們處於美容護理市場的前沿。我們能夠同時服務高端品牌和大眾市場品牌，再加上我們不懈的創新和作為首選 CDMO 的地位，使我們擁有獨特的競爭優勢。

We're proud of our impressive roster of loyal leading brand partners, our customers, who value and promote our differentiated offerings, ensuring high retention rates and sustainable growth. Furthermore, we've proactively strengthened our operational foundation and financial flexibility, ensuring we're well equipped to invest and scale for future growth and guard against potential near-term demand headwinds.

我們為擁有一群忠誠的領先品牌合作夥伴和客戶而感到自豪，他們重視並推廣我們的差異化產品，確保高保留率和永續成長。此外，我們積極加強營運基礎和財務靈活性，確保我們有能力為未來成長進行投資和擴展，並防範潛在的短期需求逆風。

Our recent NASDAQ uplisting, inclusion in the Russell indices and increased borrowing capacity all underscore our commitment to maximizing shareholder value. I'd like to close by thanking our shareholders for your continued support and look forward to updating you on our progress next quarter. Daniel, you may close the call.

我們最近在納斯達克上市、被納入羅素指數以及提高借貸能力都凸顯了我們致力於最大化股東價值的承諾。最後，我要感謝股東們的持續支持，並期待下個季度向你們通報我們的進展。丹尼爾，你可以結束通話了。

This concludes today's conference call. Thank you for participating. You may now disconnect.

今天的電話會議到此結束。感謝您的參與。您現在可以斷開連線。