Thorne HealthTech Reports 3Rd Quarter 2022 Results.

NEW YORK: Thorne HealthTech, Inc. ("Thorne HealthTech", "Thorne" or the "Company") (NASDAQ: THRN), a leader in developing personalized, innovative solutions that empower individuals to live healthier, longer lives, today announced its financial results for the third quarter ended September 30, 2022.

Third Quarter Highlights:

Net sales grew 21.7% year-over-year to $58.4 million, with direct-to-consumer ("DTC") sales growth of 47.2%

Gross profit grew 10.3% year-over-year to $28.2 million; gross margin decreased 500 basis points year-over-year to 48.2%

Net income attributable to common stockholders grew to $3.7 million; adjusted EBITDA grew to $8.3 million

Diluted earnings per share ("EPS") of $0.07; adjusted diluted EPS of $0.12

"People trust Thorne to support their daily wellness journeys because of the personalization we offer, the science behind our portfolio of solutions including our health tests and supplements, and our unmatched quality standards," said Paul Jacobson, Thorne HealthTech's chairman and CEO. "For these reasons, our high-end customer base has thus far been resilient. We saw no major changes in purchasing behavior and achieved record sales for the quarter driven by DTC channel growth of 47%. Our gross margins softened from proactive early actions, to secure a large supply of ingredients typically associated with lower margin products, in order to ensure product continuity for our customers ahead of anticipated supply chain risks. That decision allowed us to aggressively sell into a heightened demand environment as those risks materialized, increasing our brand awareness through product availability."

Mr. Jacobson added, "We also made further strides bringing our OneDraw blood sample collection device into the home. In August, we achieved a major milestone by receiving DTC medical device clearance from Japanese regulators, while continuing to work towards DTC clearance in the U.S. We believe these clearances will offer significant business development opportunities, long-term. Our solid financial performance, continued efficiency gains from scale and recent cutting-edge developments will allow us to continue our long history of profitable growth and further strengthen our positioning heading into next year."

Net Sales

The following tables provide a summary of sales by channel for the three and nine months ended September 30, 2022, compared to the three and nine months ended September 30, 2021:

Three Months Ended September 30,

Amounts

Year-Over-Year

As % of Net Sales

2022

2021

$ Change

% Change

2022

2021

(dollars in thousands)

DTC

$

26,975

$

18,322

$

8,653

47.2

%

46.2

%

38.2

%

Professional/B2B (1)

31,444

29,688

1,756

5.9

%

53.8

%

61.8

%

Net sales

$

58,419

$

48,010

$

10,409

21.7

%

100.0

%

100.0

%

Nine Months Ended September 30,

Amounts

Year-Over-Year

As % of Net Sales

2022

2021

$ Change

% Change

2022

2021

(dollars in thousands)

DTC

$

81,668

$

54,758

$

26,910

49.1

%

48.3

%

40.5

%

Professional/B2B (1)

87,487

80,625

6,862

8.5

%

51.7

%

59.5

%

Net sales

$

169,155

$

135,383

$

33,772

24.9

%

100.0

%

100.0

%

____________________________

(1) "Professional" generally means the Company's network of health professionals; and "B2B" generally means business-to-business customers.

The following table provides a summary of our annual life-time value ("LTV") to customer acquisition cost ("CAC") ratio for the three and nine months ended September 30, 2022, compared to the three and nine months ended September 30, 2021.

Three Months Ended September 30,

Nine Months Ended September 30,

2022

2021

2022

2021

LTV to CAC (2)

7.8

x

2.4

x

3.2

x

3.7

x

____________

(2) Refer to the "Key Financial and Operating Data" section below.

As of September 30, 2022, the number of active subscriptions grew 50.5% to 329,569, compared to 218,935 as of September 30, 2021. Refer to the "Key Financial and...