Ainos Reports Unaudited Third Quarter 2022 Financial Results

Rhea-AI Summary

Ainos, Inc. (NASDAQ: AIMD) reported a remarkable 384.2% year-over-year revenue increase, totaling $1,757,774 in Q3 2022, driven primarily by robust sales of COVID-19 Antigen Self-Test Kits in Taiwan. Gross profit reached $581,742, with a gross margin of 33.1%. The company's debt ratio significantly improved to 6.8%, down from 75% at the end of 2021. Despite the growth in revenues, a net loss of $7,821,756 was reported. Ainos continues to focus on its innovative product pipeline, including upcoming Phase 2 trials for its VELDONA® oral interferon formulation.

Positive

• Revenues increased by 384.2% year over year, reaching $1,757,774.
• Gross profit rose to $581,742, up 124% year over year.
• Debt ratio improved to 6.8%, significantly down from 75% at year-end 2021.
• Ongoing Phase 2 clinical trials for VELDONA® indicate potential future growth.

Negative

• Net loss attributable to common stock shareholders was $7,821,756, compared to $1,160,110 in Q3 2021.
• Gross margin decreased to 33.1% from 71.5% year over year due to a shift in revenue mix.

Revenues increased by 384% year over year

Debt ratio decreased to 7% from 75% at year-end 2021

SAN DIEGO, Nov. 7, 2022 /PRNewswire/ -- Ainos, Inc. (NASDAQ: AIMD, AIMDW) ("Ainos", or the "Company"), a diversified medtech company focused on the development of novel point-of-care testing, low-dose interferon therapeutics, and synthetic RNA-driven preventative medicine, today announced its unaudited financial results for the third quarter ended September 30, 2022.

Third Quarter 2022 Financial Highlights

• Revenues were US$1,757,774 in the third quarter of 2022, up 384.2% year over year.
• Gross profit was US$581,742, up 124% year over year, representing a gross margin of 33.1% in the third quarter of 2022.

Chun-Hsien Tsai, Chairman of the Board, President, and Chief Executive Officer of Ainos, commented, "We once again delivered robust year-over-year revenue growth and continued to develop and advance the monetization of our innovative product pipeline. Looking ahead, we are recalibrating our R&D efforts to focus on the development and commercialization of our key VOC POCT and VELDONA® technologies. During the quarter, VELDONA®, our very low-dose oral interferon alpha formulation, showed its antiviral efficacy in a hamster study, and is on track to initiate Phase 2 clinical trials in Taiwan. We are also pursuing out-licensing for five Phase 2 VELONDA® candidates, with the goal of accelerating them to Phase 3 trials and commercialization. Our non-invasive and telehealth-friendly VOC POCT product pipeline delivers solutions to large and expanding markets such as STI testing and women's health. Our Ainos Flora product, which allows users to easily and discreetly test for vaginal infections and certain STIs in just minutes, is currently going through clinical studies in Taiwan. In regards to our current product line, we will broaden distribution and expand sales channels for our COVID antigen test kits in Taiwan, while ramping up sales to our existing customer base. Going forward, we will further strengthen our monetization capabilities and deliver long-term sustainable value for our shareholders."

Hui-Lan Wu, Chief Financial Officer of Ainos, commented, "Year-over-year top-line growth of 384.2% was driven by strong sales of our COVID­19 Antigen Self-Test Kits during the third quarter. During the quarter, in addition to delivering strong topline growth, we reduced our debt and strengthened our balance sheet following the conversion of our convertible notes and proceeds from our public offering. As a result of these efforts, our debt ratio now stands at just 6.8%, down from 75% at year-end 2021. We will continue to ramp up our COVID antigen test business in Taiwan as we further develop and commercialize our product pipeline as scheduled."

Third Quarter 2022 Financial Results

Revenues

Revenues increased by 384.2% to US$1,757,774 in the third quarter of 2022 from US$363,052 in the same period of 2021, driven by increased sales of the Company's COVID-19 Antigen Self-Test Kits in Taiwan. An increase in the number of COVID-19 cases in Taiwan and increased acceptance of our highly accurate self-test kit contributed to the strong performance.

Cost of Revenues

Cost of revenues was US$1,176,032 in the third quarter of 2022, compared with US$103,638 in the same period of 2021. Such increase was consistent with the corresponding increase in sales volume, as the Company shipped more of its COVID-19 Antigen Self-Test Kits.

Gross Profit

In the third quarter of 2022, gross profit was US$581,742, representing a 33.1% gross margin, compared to US$259,414, or a 71.5% gross margin a year ago. The decline in gross margin was driven by a shift in the Company's revenue mix. To align with Taiwan's infection control policy, we generated more revenue from the COVID-19 Antigen Self-Test Kit in the third quarter. In comparison, the majority of our revenue during the comparable period had been generated from sales of our COVID-19 Rapid Test Kit for use by healthcare professionals. The self-test kit accounted for all our business in the third quarter, compared to 7% in the previous quarter.

Total Operating Expenses

Total operating expenses increased to US$8,404,013 in the third quarter of 2022 from US$1,442,756 in the same period of 2021. The increase was mainly attributable to depreciation and amortization expenses and share-based compensation. Operating expenses excluding depreciation and amortization expenses and share-based compensation remained relatively flat, reaching US$1,118,205 in the third quarter of 2022 as compared to US$759,589 a year ago.

• R&D expenses increased to US$1,834,786 in the third quarter of 2022 from US$646,798 a year ago. When excluding depreciation and amortization expenses, R&D expenses increased to US$628,367 from US$401,526 over the same period.
• SG&A expenses increased to US$6,569,227 from US$795,958 over the same period. When excluding depreciation and amortization expenses and share-based compensation, SG&A expenses increased to US$489,838 from US$358,063 over the same period.

Net Loss

Net loss attributable to common stock shareholders was US$7,821,756 in the third quarter of 2022, compared with US$1,160,110 in the same period of 2021.

Balance Sheet

As of September 30, 2022, the Company had cash and cash equivalents of US$2,417,147 compared with US$1,751,499 as of December 31, 2021.

Recent Developments

On August 15, 2022, the Company announced that it had signed a Master Service Agreement with Swiss Pharmaceutical Co., Ltd. (Taiwan) ("Swiss Pharma"). According to the agreement, Swiss Pharma will test, manufacture, and package the Company's VELDONA® "GMP Clinical Batch" and "GMP Commercial Batch" product candidates for the Company's planned clinical trials under both Pharmaceutical Inspection Co-operation Scheme Good Manufacturing Practice and U.S. Food & Drug Administration Current Good Manufacturing Practice regulations.

On August 24, 2022, the Company announced that it had submitted an Investigational New Drug application to the U.S. Food and Drug Administration for conducting a Phase 2 trial of its low-dose oral interferon alpha formulation, VELDONA®, for treatment of mild symptoms related to COVID-19.

On September 30, 2022, the Company announced the results from its antiviral efficacy study in hamsters against the Omicron variant of SARS-CoV-2. The Company's results showed that its low-dose oral interferon alpha formulation, VELDONA®, had a therapeutic effect on lungs infected with the SARS-CoV-2 virus by regulating the immune response, thereby expediting recovery of infected animals. The Company has submitted the application documents for U.S. FDA Phase 2 clinical trials for evaluating the efficacy of VELDONA® in patients with mild COVID-19.

On October 31, 2022, the Company announced that it is pursuing out-licensing opportunities for five new drug candidates for its low-dose oral interferon-alpha formulation, VELDONA®. Ainos has completed Phase 2 trials for the five new drug candidates and will work with potential partners to accelerate the candidates to Phase 3 trials and eventual commercialization of VELDONA®.

About Ainos, Inc.

Headquartered in San Diego, California, Ainos, Inc. (f/k/a Amarillo Biosciences, Inc.) is a diversified medtech company engaged in developing innovative medical technologies for point-of-care testing and safe and novel medical treatment for a broad range of disease indications. In addition to its proprietary therapeutics using low-dose non-injectable interferon, Ainos is committed to developing a comprehensive healthcare business portfolio encompassing medical devices and consumer healthcare products. While prioritizing the commercialization of medical devices as part of its diversification strategy, Ainos has also expanded its product portfolio to include Volatile Organic Compounds (VOC) and COVID-19 POCTs. Leveraging its patents related to VOC technologies and three issued patents for COVID-19 POCT products, the Company seeks to expedite the commercialization of its medical device pipeline, beginning with Ainos-branded COVID-19 POCT product candidates.

Forward-Looking Statements

This press release contains 'forward-looking statements' within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as "anticipate," "believe," "estimate," "expect," "intend," "plan," "predict," "project," 'target," "future," "seek," "likely," "strategy," "may," "should," "will," and similar references to future periods. Forward-looking statements are based only on our current beliefs, expectations, and assumptions. Forward-looking statements are subject to inherent uncertainties, risks, and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results may differ materially from those indicated in the forward-looking statements.

Important factors that could cause our actual results to differ materially from those indicated in the forward-looking statements include, among others, the following: the cost of production and sales potential of the planned drug treatments announced in this press release; the impact of final approvals from the U.S. Food and Drug Administration (the "FDA") or other regulatory bodies for the planned drug treatments including the availability of emergency use authorization; the Company's limited cash and history of losses; the Company's ability to achieve profitability; intense competition and rapidly advancing technology in the Company's industry that may outpace its technology; customer demand for the products and services the Company develops; the impact of competitive or alternative products, technologies and pricing; the Company's ability to manufacture any products it develops; general economic conditions and events and the impact they may have on the Company and its potential customers, including but not limited to the impact of Covid-19; the Company's ability to obtain adequate financing in the future; the impact of promulgation and implementation of regulations by the World Health Organization, the FDA and by other governmental authorities with functions similar to those of the FDA on the Company's operations and technologies; lawsuits and other claims by third parties or investigations by various regulatory agencies governing the Company's operations; the Company's ability to secure regulatory approvals for its products; and our success in managing the risks involved in the foregoing items. Readers should also review the risks and uncertainties listed in our Annual Report on Form 10-K for the year ended December 31, 2021 and other reports we file with the U.S. Securities and Exchange Commission.

Any forward-looking statement made by us in this press release speaks only as of the date on which such statement is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

Investor Relations Contact
ICR, LLC
Robin Yang
Tel: +1 646-224-6971
Email: Ainos.IR@icrinc.com

	Ainos, Inc.
	Condensed Consolidated Statements of Operations
	(Unaudited)
				Three months ended September 30,				Nine months ended September 30,
				2022		2021		2022		2021
	Revenues			$      1,757,774		$         363,052		$      2,481,602		$         568,164
	Cost of revenues			(1,176,032)		(103,638)		(1,536,074)		(174,395)
	Gross Profit			581,742		259,414		945,528		393,769
	Operating expenses:
		Research and development expenses		1,834,786		646,798		5,047,096		646,798
		Selling, General and administrative expenses		6,569,227		795,958		7,748,060		2,178,969
			Total operating expenses	8,404,013		1,442,756		12,795,156		2,825,767
	Operating loss			(7,822,271)		(1,183,342)		(11,849,628)		(2,431,998)
	Non-operating income and expenses,net
		Interest expenses, net		(9,821)		23,517		(45,304)		(9,361)
		Other Losses		10,336		(285)		19,250		(2,532)
			Total non-operating income and expenses,net	515		23,232		(26,054)		(11,893)
	Net  loss			(7,821,756)		(1,160,110)		(11,875,682)		(2,443,891)
	Net loss per common shares-basic and diluted			$              (0.51)		$              (0.12)		$              (1.03)		$              (0.48)
	Weighted average common shares outstanding– basic			15,301,396		9,494,468		11,538,013		5,061,160
	and diluted

 

 

Ainos, Inc. Condensed Consolidated Balance Sheets (Unaudited)
				September 30, 2022		December 31, 2021
Assets
Current assets:
	Cash and cash equivalents			$             2,417,147		$       1,751,499
	Accounts receivable			400,198		-
	Inventory			698,295		-
	Other current assets			152,406		466,198
		Total current assets		3,668,046		2,217,697
Intangible assets, net				33,946,391		37,329,191
Property and equipment, net				1,350,960		1,187,702
Other Assets				116,425		87,571
Total assets				$           39,081,822		$    40,822,161
Liabilities and Stockholders' Equity
Current liabilities:
	Convertible notes payable			$                 376,526		$       3,376,526
	Notes payable			884,000		213,405
	Contract liabilities			33,055		59,575
	Accrued expenses and others current liabilities			1,349,666		945,293
	Payable -related party			-		26,000,000
		Total current liabilities		2,643,247		30,594,799
Long term liabilities:
	Operating lease liabilities-non-current			12,505		30,255
		Total liabilities		2,655,752		30,625,054
Stockholders' equity
Preferred stock, $0.01 par value; 10,000,000 shares
	authorized; none issued
Common stock, $0.01 par value;
	300,000,000 shares authorized as of Sep 30, 2022 and December 31, 2021;
	19,478,270 shares and 9,625,133  shares issued and outstanding as of Sep 30, 2022 and December 31, 2021
				194,783		96,251
Additional paid-in capital				58,491,505		20,203,972
Accumulated deficit				(21,984,598)		(10,108,916)
Translation adjustment				(275,620)		5,800
		Total stockholders' equity		36,426,070		10,197,108
Total liabilities and stockholders' equity				$           39,081,822		$    40,822,161

 

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SOURCE Ainos, Inc.

FAQ

What were Ainos' revenue results for Q3 2022?

Ainos reported revenues of $1,757,774 for Q3 2022, marking a 384.2% increase year over year.

How much did Ainos' net loss increase in Q3 2022?

The net loss for Q3 2022 was $7,821,756, compared to $1,160,110 in Q3 2021.

What is Ainos' current debt ratio?

Ainos' debt ratio is currently at 6.8%, down from 75% at year-end 2021.

What clinical trials is Ainos pursuing for VELDONA®?

Ainos is preparing to initiate Phase 2 clinical trials for its VELDONA® low-dose oral interferon formulation.

How did Ainos' gross profit change in Q3 2022?

Gross profit for Ainos in Q3 2022 was $581,742, which is a 124% increase year over year.