The following is a summary of the Better Choice Company Inc. (BTTR) Q2 2024 Earnings Call Transcript:

Financial Performance:

• Q2 witnessed average fill rates improving to 95% from last year's 78%.

• Adjusted EBITDA improved by 98% year-over-year, indicating effective strategic and operational adjustments.

• Achieved a net top-line growth of 8% from Q1 2024, with net sales reaching $8.5 million.

• International market sales grew by 27% from Q1 and 7% year-over-year.

• Gross margin for Q2 improved by 400 basis points year-over-year to 38%.

• Recorded a GAAP net income of $2.7 million and EPS of $2.98, driven by a $3.6 million gain from a retired term loan.

Business Progress:

• Strategic pivot to major online platforms like Chewy and Amazon, particularly for the Halo brand, leading to increased subscription-based revenue and a stronger digital footprint.

• Exited unprofitable channels, improving the bottom line significantly.

• Improved operational discipline led to a 57% reduction in finished goods inventory compared to last year.

• The efforts towards streamlining operating expenditures and enhancing organizational efficiency are expected to continue improving profitability.

Opportunities:

• Strong focus on tapping into the $50 billion U.S. and Canada pet food markets and the $30 billion Asia-Pacific market through strategic market expansions and brand enhancements.

• Leveraging societal trends towards humanization and premiumization of pet products, which positions the Halo brand for broader acceptance and increased demand.

Risks:

• Adjusting to strategic exits from several unprofitable brick-and-mortar customers might temporarily impact top-line growth but is strategically intended for longer-term profitability.

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