Escalon Medical Corp. reported its financial results for the three months ended September 30, 2024, revealing a decline in net revenues and an increase in net losses compared to the same period in the previous year. The company generated net revenues of $2.78 million, a decrease of approximately $164,000 or 5.6% from $2.95 million in the same quarter of 2023. This decline was primarily attributed to a $418,000 drop in sales of Sonomed's ultrasound products, partially offset by a $257,000 increase in sales of Trek's gas products.

Total costs and expenses for the quarter were $2.81 million, down from $2.96 million in the prior year. The cost of goods sold amounted to $1.57 million, representing 56.4% of total revenue, slightly up from 56.0% in the previous year. The increase in the cost of goods sold percentage was linked to changes in product sales mix and geographic differences, although it was partially mitigated by reduced digital labor costs.

Escalon Medical Corp. reported a net loss of $32,217 for the quarter, compared to a net loss of $21,197 in the same period last year. The net loss applicable to common shareholders also increased to $45,187 from $34,203. The company’s total shareholders’ equity decreased to $1.78 million as of September 30, 2024, down from $1.81 million at the end of June 2024.

The company’s cash position improved slightly, with total cash increasing to $229,696 from $209,033 as of June 30, 2024. Total current assets rose to $4.45 million, while total inventories increased to $1.81 million from $1.61 million in the previous quarter. The company reported an accumulated deficit of approximately $68.6 million, reflecting its ongoing challenges with recurring losses and negative cash flows from operations.

In terms of operational adjustments, Escalon Medical Corp. is actively pursuing business partnerships and implementing cost-cutting measures to address its financial challenges. The company has also identified a material weakness in its internal control related to inventory valuation and allowance for doubtful accounts, prompting improvements in data quality control and inventory valuation processes.

Overall, the company continues to navigate a difficult market environment while focusing on strategic initiatives to enhance its financial stability and operational efficiency.