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MyDx Reports Strong Second Quarter 2016 Revenues; Company Expects Continued Growth in Second Half 2016

Second Quarter Highlights:

  • Revenues Jumps 73% Higher, Sequentially, to $279,000
  • Gross Margin Scales 37% Higher, Sequentially, to 59%
  • Operating expenses decreased by $1.1 million, or 53%, from ($2.1 million) to ($990,000) year-over-year
  • Highly Anticipated New Product Launch on Schedule for Fourth Quarter 2016

LA JOLLA, Calif., Aug. 15, 2016 (GLOBE NEWSWIRE) -- MyDx, Inc. (OTCQB:MYDX), a rapidly growing chemical detection company, today announced its financial results for the second quarter ended June 30, 2016 and provided an updated, positive outlook on the balance of 2016.

Company Reports Second Quarter Results

For the second ended June 30, 2016, the Company reported revenues rose 73% to a record $279,000, sequentially from the first quarter, 2016, and compares with zero revenues in the year-ago quarter when it was still in the research and development stage. Revenues for the quarter were driven primary by the sales of its MyDx® analyzer with the CannaDx™ sensor.

As a result of the Company’s improved operating efficiencies, its operating expenses were reduced by approximately 53%, year over year, down from $2.1 million to $990,000. The decrease in operating expenses reflects a 75% reduction in R&D expenditures from $585,000 to $146,000; a 79% decrease in sales and marketing expenditures from $278,000 to $58,000; and, a 37% decrease in general and administrative expenses from $1.2 million to $786,000. Despite the decrease in R&D expenditures, the Company has reported record R&D advancements in accelerating the launch of OrganaDx™, AquaDx™ and AeroDx™.

The Company’s second quarter 2016 net loss decreased by approximately 55%, year over year, from ($2.1 million), ($0.20) per share, to ($937,000), $(0.04) per share.

Company’s Most Successful Quarter Yet

The second quarter was MyDx’s most productive quarter to date, highlighted by:

  • Signed a major distribution agreement for its CannaDx product line with Nanolux Technology, Inc., announced April 5
  • An exceptionally large volume of positive media coverage, worldwide, reported May 3
  • Surprisingly robust, early global sales of its MyDx chemical analyzer with CannaDx sensor as disclosed May 5
  • Launch of its updated, data and feature-rich CannaDx smart phone App for both iOS and Android platforms announced June 1
  • Signed an agreement with Arrow Electronics, a Fortune 150 company, to scale its supply chain and contract manufacturing capabilities for its MyDx product line disclosed June 22

MyDx CEO Sees Continued Growth in the Second Half of 2016

As stated in its news release report on its first quarter, ended March 31, 2016, the Company has streamlined operations with R&D, sales and marketing, and general and administrative expenses continuing to trend sharply lower throughout the first half of 2016.

Today, MyDx is an efficient new product development, sales and marketing organization with an exciting line up of new sensors for its multi-purpose chemical analyzer -- that address global mass markets -- being readied for launch in the fourth quarter of 2016 and into 2017.

Commenting on the Company’s historically successful second quarter results, Daniel Yazbeck, MyDx Chairman and CEO, said, “CannaDx continues to capture market share with momentum, building a strong word-of-mouth and social media buzz amongst our consumers and purveyors of legal cannabis while simultaneously generating valuable brand awareness globally for our multi-purpose MyDx chemical analyzer.

“Coupled with its sophisticated smart phone application, the MyDx analyzer is a unique product that for the first time places the unrivalled power of testing for chemicals where it belongs – in the hands of consumers.

Company Prepares for Launch of New Revenue Channels

“Building on the market’s acceptance of our patented technology, as demonstrated through the success of our CannaDx analyzer, we are excited to prepare for the launch of our next sensor, AquaDx, which places real-time affordable water quality testing and tracking in the hands of consumers.

The next stage of our growth will include the development of the Company’s distribution channels in markets beyond cannabis. Our business strategy will include the creation of an international team that will focus on areas around the globe that have a need for our products, in particular areas that have issues with chemical contaminants in their water, air and food. We have secured efficient, world class manufacturing and supply chain management to support our growth strategy. Our goal remains to continue to help consumers globally, expand profitability and enhance shareholder value,” Mr. Yazbeck concluded.

Company Six Months Ended June 30, 2016: Revenues Up, Expenses Down

For the six months ended June 30, 2016, the Company reported revenues of $441,000 compared with zero revenues in the year-ago period when it was still in the research and development stage.

Operating expenses decreased by $2.3 million, or 60%, from $3.9 million to $1.6 million, for the six months ended June 30, 2016. The dramatic decrease in operating expenses reflects R&D expenditures decreased by $1.1 million, or 82%; sales and marketing expenses decreased by $469,000, or 70%, and, general and administrative expenses decreased by $759,000 or 40%.

MyDx’s first-half, 2016, net loss decreased by nearly two thirds, year over year, from ($4.36 million), or $(0.41) per share, to ($1.5 million), or $(0.07) per share.

About MyDx, Inc.

MyDx, Inc. (OTCQB:MYDX) is a chemical detection and sensor technology company based in San Diego, California whose mission is to help people Trust & Verify® what they put into their minds and bodies. The Company developed MyDx®, a patented, affordable portable analyzer that provides real-time chemical analysis and fits in the palm of the user’s hand. The multi-use MyDx analyzer leverages over a decade of established electronic nose technology to measure chemicals of interest. It owns a substantial and growing intellectual property portfolio of patents covering its technology. With its CannaDx sensor commercialized, it has three other sensors being developed in its lab that are compatible with the MyDx Analyzer and App that will empower consumers to test the chemical composition of what they eat, drink and inhale. For more information, please visit www.cdxlife.com.

Forward-Looking Statements

This news release contains "forward-looking statements" as that term is defined in Section 27(a) of the Securities Act of 1933, as amended, and Section 21(e) of the Securities Exchange Act of 1934, as amended. Statements may contain certain forward-looking statements pertaining to future anticipated or projected plans, performance and developments, as well as other statements relating to future operations and results. Any statements in this press release that are not statements of historical fact may be considered to be forward-looking statements. Words such as "may," "will," "expect," "believe," "anticipate," "estimate," "intends," "goal," "objective," "seek," "attempt," or variations of these or similar words, identify forward-looking statements. These forward-looking statements by their nature are estimates of future results only and involve substantial risks and uncertainties, including but not limited to risks associated with the uncertainty of future financial results, additional financing requirements, development of new products, our ability to complete our product testing and launch our product commercially, the acceptance of our product in the marketplace, the uncertainty of the laws and regulations relating to cannabis, the impact of competitive products or pricing, technological changes, the effect of economic conditions and other uncertainties detailed from time to time in our reports filed with the Securities and Exchange Commission, available at www.sec.gov.

MyDx, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
For the Three Months
Ended
June 30,
For the Six Months
Ended
June 30,
2016 2015 2016 2015
Net Revenues $279,382 $- $440,640 $-
Cost of goods sold 114,363 - 205,689 -
Gross profit 165,019 - 234,951 -
Operating Expenses
Research and development 145,885 585,084 241,092 1,353,414
Sales and marketing 58,319 278,019 203,612 672,653
General and administrative 785,945 1,238,056 1,140,258 1,899,053
Total operating expenses 990,149 2,101,159 1,584,962 3,925,120
Loss from operations (825,130) (2,101,159) (1,350,011) (3,925,120)
Interest expense, net 36,550 743 55,380 441,761
Loss on settlement of debt 73,935 - 73,935 -
Loss before provision for income taxes (935,615) (2,101,902) (1,479,326) (4,366,881)
Provision for income taxes 1,050 - 1,850 800
Net loss $(936,665) $(2,101,902) $(1,481,176) $(4,367,681)
Basic and diluted loss per share $(0.04) $(0.20) $(0.07) $(0.41)
Weighted average shares used in computing net loss per share
Basic and diluted 22,647,732 10,689,072 22,415,242 10,683,955


MyDx, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
June 30, December 31,
2016 2015
ASSETS
Current assets:
Cash $190,369 $143,680
Accounts receivable 11,067 10,702
Inventory 380,906 451,973
Prepaid expenses and other current assets 15,809 51,978
Total current assets 598,151 658,333
Property and equipment, net 190,372 233,064
Other assets 96,231 104,365
Total assets $884,754 $995,762
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Asset based loans $271,370 $-
Accounts payable 1,009,526 619,528
Customer deposits 6,380 9,467
Accrued liabilities 283,641 281,761
Current portion of leases payable 2,873 2,773
Due to related party 1,075 1,075
Convertible notes payable, current 210,795 50,574
Total current liabilities 1,785,660 965,178
Convertible note payable - Related Party 125,000 175,000
Convertible notes payable 244,507 200,274
Other long-term obligations 22,878 2,721
Total liabilities 2,178,045 1,343,173
Commitments and contingencies (Note 11)
Stockholders' deficit:
Common stock, $0.001 par value, 375,000,000 shares authorized; 23,543,834 and 22,081,928 shares issued and outstanding as of March 31, 2016 and December 31, 2015, respectively 23,544 22,081
Additional paid-in capital 10,061,905 9,528,072
Accumulated deficit (11,378,740) (9,897,564)
Total stockholders' deficit (1,293,291) (347,411)
Total liabilities and stockholders' deficit $884,754 $995,762


Investor Contact: Phillip Sugarman, Vice President Investor Relations Partners Phone: 818-280-6800 psugarman@irpartnersinc.com

Source:MyDx, Inc