BURLINGTON, ON, May 6, 2024 /CNW/ - EcoSynthetix Inc. (TSX:ECO) ("EcoSynthetix" or the "Company"), a renewable chemicals company that produces a portfolio of commercially proven bio-based products, today announced its financial and operational results for the three months (Q1 2024) ended March 31, 2024. Financial references are in U.S. dollars unless otherwise indicated. Highlights(Comparison periods in each case are the three months ended March 31, 2023) Recorded net sales of $4.7 million, up 53%, compared to the prior period. Recorded an Adjusted EBITDA1 loss of $0.5 million, an improvement of $0.1 million from the prior period. Extended its exclusive relationship with Dow with a five-year contract renewal which reinforces the Company's commitment to innovative bio-based solutions in the personal care end market. Shipped $0.3 million of SurfLock™ for an extended trial in pulp applications with a leading paper and pulp producer. A leading international retailer backward integrated as a producer of particleboard, identified the use of bio-based glues in one of its particleboard factories in 2023 as a milestone that will impact its future carbon footprint. Today, 5% of the climate footprint of the total value chain of this leading international retailer is connected to the use of glue in its board materials. Commissioned the new manufacturing line in Burlington, Ontario. By internalizing production, the Company improves its ability to launch new products and reduce supply chain management risk. Received the Platinum designation for the third consecutive year from EcoVadis, a globally recognized agency for business sustainability ratings of supply chains, by scoring within the top 1% of the 125,000 companies rated. Maintained a strong balance sheet with cash and term deposits of $33.7 million as at March 31, 2024. Purchased and cancelled 165,900 common shares in Q1 2024 under the normal course issuer bid for total consideration of $0.6 million. "Higher demand in our key end markets drove improved volumes. This led to a rebound in sales and an improvement in our bottom line and positive cash flow from operating activities in the quarter," said Jeff MacDonald, CEO of EcoSynthetix. "Our key commercial priority is expanding within our strategic accounts in wood composites and pulp-based products. Trial activity remains strong at both existing accounts trialing on new lines as well as with new prospects, including the largest trial in our history with a major pulp producer. In the wood composites market, the international retailer continues to raise awareness with its supply chain partners of the benefits of bio-based glue as a key driver to reduce the retailer's overall carbon footprint. Our DuraBind™ resin offers a powerful value proposition in replacing harmful formaldehyde with our lower carbon, bio-based solution at a comparable cost. In the tissue, packaging and pulp end market, our SurfLock™ strength aids offer manufacturers productivity improvements ranging from increased yields and strength to reduced cost depending on the application. We believe the pulp opportunity is comparable in scale to the wood composites opportunity. These two end markets, together with our relationship with Dow in the personal care space, position us for sustainable, long-term growth." Financial Summary Net Sales Net sales were $4.7 million for Q1 2024 compared to $3.1 million for the corresponding period in 2023. The 53% increase was due to higher volumes, which increased sales $1.9 million, or 63%, partly offset by a lower average selling price which decreased sales $0.3 million or 10%. The higher volumes were primarily due to improved demand, including inventory replenishment at a distributor, as well as a $0.3 million sale of SurfLock™ for an extended trial in a pulp application with a leading paper and pulp producer. The lower average selling price was primarily due to lower manufacturing costs which were passed on to customers, as well as product mix.   Gross Profit Gross profit was $1.1 million for Q1 2024 compared to $0.6 million for the corresponding period in 2023. The increase was primarily due to higher volumes, partially offset by a lower average selling price. Gross profit as a percentage of sales was 24.2% for Q1 2024 compared to 20.1% for the corresponding period in 2023. The increase was primarily due lower manufacturing depreciation offset by a lower average selling price. Gross profit as a percentage of sales adjusted for manufacturing depreciation was 29.2% for Q1 2024 compared to 32.6% for the corresponding period in 2023.  The decrease was primarily due to a lower average selling price.   Selling, General and Administrative Selling, general and administrative expenses (SG&A) were $1.7 million for Q1 2024 compared to $1.3 million for the corresponding period in 2023. The increase was primarily due to $0.3 million asset relocation costs associated with the Company's manufacturing realignment strategy announced in February of 2023. Research and Development Research and development (R&D) costs were $0.4 million for Q1 2024 compared to $0.6 million in the corresponding period in 2023. The change was primarily due to lower product scale up costs in the 2024 period compared to investments made in the same period in 2023. R&D expense as a percentage of sales was 10% for Q1 2024 compared to 20% in the corresponding period in 2023. The Company's R&D efforts continue to focus on further enhancing value for our existing products and expanding addressable opportunities. Adjusted EBITDA1 Adjusted EBITDA loss was $0.5 million for Q1 2024 compared to $0.6 million in the corresponding period in 2023. The improvement was primarily due to higher gross profit offset by higher operating costs adjusted for non-cash items when compared to the prior period. Net Loss Net loss was $0.6 million, or $0.01 per common share, for Q1 2024 compared to $1.0 million, or $0.02 per common share, for the corresponding period in 2023. The improvement was primarily due to a lower loss from operations of $0.2 million and an increase in net interest income of $0.2 million. The higher net interest income during the period was due to an increase in interest rates on cash and term deposits. Liquidity Cash on hand and term deposits were $33.7 million as at March 31, 2024 compared to $33.3 million as at December 31, 2023. The Company purchased and cancelled 165,900 common shares under the NCIB during Q1 2024. Notice of Conference Call EcoSynthetix will host a conference call Tuesday, May 7, at 8:30 am ET to discuss its financial results. Jeff MacDonald, CEO, and Robert Haire, CFO, will co-chair the call. All interested parties can instantly join the call by phone, by following the URL