Pharma-Bio Serv Reports Significant Revenue and Profit Declines in Q3 and Nine Months Ended July 31, 2024

Pharma-Bio Serv, Inc. reported significant declines in revenue and profitability for the three and nine months ended July 31, 2024, compared to the same periods in 2023. Total revenues for the three months were $2.42 million, down from $4.58 million, while revenues for the nine months decreased to $7.18 million from $13.38 million. The company's gross profit also fell sharply, with a gross profit of $635,384 for the three months, down from $1.55 million, and $1.79 million for the nine months, compared to $4.14 million in the prior year.

The company experienced a loss from operations of $381,782 for the three months ended July 31, 2024, contrasting with an income of $460,466 in the same period last year. For the nine-month period, the loss from operations was $1.13 million, compared to an income of $1.17 million in 2023. Net losses were reported at $309,194 for the three months and $793,730 for the nine months, compared to net incomes of $526,242 and $1.36 million, respectively, in the previous year. Basic and diluted earnings per share reflected these losses, with a loss of $0.014 for the three months and $0.035 for the nine months.

The decline in revenue was attributed primarily to reduced demand for technical compliance consulting services across its three reportable segments: Puerto Rico, the United States, and Europe. The company noted that four customers accounted for 35.9% of revenues in the three months ended July 31, 2024, down from 58.0% in the same period in 2023.

Despite the downturn in revenue, Pharma-Bio Serv reported a net increase in cash and cash equivalents of $3.01 million for the three months ended July 31, 2024, compared to a decrease of $5.23 million in the same period last year. The company ended the period with $6.52 million in cash and cash equivalents, up from $2.87 million a year earlier.

In terms of strategic developments, the company is focusing on strengthening its business development infrastructure and realigning strategies to penetrate underserved markets. This includes investments in business development resources and automation marketing tools for fiscal year 2024. Additionally, the company has a stock repurchase program in place, with 12,100 shares repurchased during the nine-month period, leaving 1,501,443 shares available for future repurchases.

Pharma-Bio Serv continues to navigate challenges such as regional conflicts, price inflation, and changes in tax laws, which may impact future performance.