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Riccardo Delle Coste, Founder, Chairman, President & CEO, confirmed a positive early response to 'Pop and Go' from large school districts, though some bids are still being finalized. He explained that customers who paused orders due to previous bottle shortages will be brought back on as consistent supply is re-established, as the products are already approved. For expansion, Delle Coste noted that increased manufacturing capacity will support broader penetration across the U.S., with a focus on highly populated states.

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The CEO, Robert Banks, attributed the growth to a combination of factors. The filter tracking app provided crucial visibility, while the service initiatives translated that visibility into action, ensuring customers reordered filters on schedule. He confirmed that the sales force is currently a limiting factor for growth and that the company plans to continue expanding it. They are using a model where seasoned experts focus on acquiring new business, while junior associates manage the existing customer base, a strategy that has proven effective and will be scaled.

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Robert Banks, Director, President & CEO, explained that growth was driven by a combination of the filter tracking app providing visibility and service initiatives turning that visibility into action, which improved customer reorder rates. Banks also identified the sales force size as a key constraint on growth, confirming that Nephros will continue to expand its sales team using a 'hunter-gatherer' model to both acquire new business and service existing clients.

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CEO Robert Banks attributed the decline in emergency response to reduced testing in key territories like Ohio, but noted that upcoming regulations in Ohio and New Jersey could reverse this trend. He also stated that technical issues with the filter tracker app have been resolved, and it is expected to improve reorder rates among existing customers. Banks confirmed that active customer sites reached a record 1,384 at the end of Q2.

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CEO and CFO Ronan Kennedy explained that the Herbal Oasis rollout, initially slowed by legislative concerns, is now ramping up with new distribution partners in the Southeast. He anticipates the brand will make a meaningful contribution to revenue by the end of fiscal 2025. Kennedy also stated that the simplified capital structure secures the company's NYSE American listing and makes the stock a viable currency for future M&A, opening up strategic opportunities that were previously hindered.

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CEO and CFO T. Kennedy explained that the hemp-derived beverage market is the fastest-growing category in the space. He clarified that the national retailer interest, while currently limited to certain jurisdictions, lends significant credibility to their Oasis line. Kennedy emphasized that the company remains focused on profitably growing its core CBD business, viewing the Oasis beverage as a key additional growth channel.

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CEO Ronan Kennedy explained that marketing strategies are constantly evolving, with a current focus on enhancing subscription and loyalty programs. He acknowledged that the wholesale channel's contribution to the revenue mix could increase slightly in 2025 but stated the goal is to grow both channels. Kennedy expressed skepticism about a significant shift in big-box retail for legacy CBD products without federal clarity, though he noted beverages are seeing more interest. Regarding regulation, Kennedy declined to comment on the new administration, while Dr. Sibyl Swift, a board member, added that while there is hope for a friendly approach to botanicals, it remains a 'wait and watch' situation with the FDA.

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CFO Domenic Penna detailed the potential gross margin impact from tariffs on products from Israel and Europe, estimating a 1-2.5% hit without mitigation. Executive Rajiv Kanishka De Silva clarified that the more significant issue is the indirect effect of economic uncertainty causing distributor hesitancy. Both executives confirmed that delayed sales were a mix of U.S. and international deals, slowed by tighter credit. De Silva also reaffirmed the new body contouring device is on track for a launch in the second half of 2025, with regulatory processes underway.

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Executive Rajiv Kanishka De Silva highlighted the constructive relationship with lender Madryn Asset Management, stating a shared goal of reaching a manageable debt level without providing a specific target. He also confirmed that Madryn has been extending covenant relief for the MSLP loan on a monthly basis during capital structure negotiations and expects this to continue until a final solution is reached.

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The company is working constructively with its lender, Madryn, to ensure debt is at a manageable level and expects bridge financing to continue. Regarding the MSLP loan, which Madryn now holds, covenant relief has been extended on a monthly basis during ongoing capital structure negotiations, and this is expected to continue until a final solution is reached.

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CFO Jon Bates responded that while predicting the exact amount of prior-period revenue is difficult due to timing, the model's accuracy is improving with more data. He noted that adding more arbitrators is a positive development that should help reduce backlogs. CEO Dr. Tom Vo and COO Josh DeTillio added that there is significant capacity to grow inpatient volume by adding specialists and enhancing community reputation, and they expect this growth to continue.

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Executives confirmed that passing the SAFER Banking Act would move projects from their qualified pipeline into the backlog, as it would provide operators with much-needed access to capital. Regarding Germany, they explained that the new law focuses on social clubs, so they don't see significant near-term opportunity. They have downsized their European operations due to market softness and high costs, retaining key experts but releasing the managing director. They do not expect the German changes to impact 2024 revenue.

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