Good morning, ladies and gentlemen, and welcome to the Valeo Pharma First Quarter Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you'd like to ask a question during this time, say "Press star," then the number 1 on your telephone keypad. If you'd like to withdraw your question, please press star 2. Thank you. Mr. Frederic Dumais, you may begin your conference.
Thank you, operator. Good morning, everyone. Present with me today for our first-quarter 2024 Financial Results Conference Call are Mr. Steve Saviuk, our CEO, and Mr. Pascal Tougas, our Chief Financial Officer. Before we begin our call, I'd like to remind everyone that this conference call may contain certain forward-looking statements regarding the company's expectations or future events. Such expectations are based on certain assumptions that are founded on currently available information. If these assumptions prove incorrect, actual results may differ materially from those contemplated by the forward-looking statements contained in this conference call. The company disclaims any intention or obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, other than as required by security laws. I would now like to pass the call over to our CEO. Steve, please go ahead.
Thank you, Fred. Good morning, all, and thank you for joining us for our First Quarter 2024 Results Conference Call. I will start by quickly reviewing our latest quarterly results, and we'll provide a brief commercial and operational progress update, and then I'll pass the mic over to our CFO, Pascal Tougas, who will provide more details on our first-quarter results. We are pleased to report that in Q1 2024, Valeo has resumed this trend of quarterly revenue growth, which had been interrupted in Q4 2023. Revenues for the first quarter reached CAD 13.5 million, up 3.0% over Q1 2023 and Q4 2023. While this revenue increase may appear to be modest on the surface, the underlying growth of a number of our key brands remains robust.
Our respiratory unit, which was the primary contributor to revenue growth in the quarter, with EnerZair leading the way, followed by Atectura and Allerject. Our ophthalmology unit was negatively impacted due to the loss of momentum associated with Deshnee Naidoo's cease of promotion on our part, that occurred towards the latter half of the quarter. Our hospital unit experienced a slight decline as it digested a particularly strong Q4 2023. Early results for Q2 2024, however, show that our hospital unit is rebounding and returning to expected growth levels. As we develop as an organization, our inventory management tools are becoming more advanced. Unfortunately, our Q1 2024 results were once again negatively impacted by inventory write-offs totaling CAD 1.1 million. This is a manageable issue, that we have addressed for the future and is related to a small number of product SKUs.
My colleague and CFO, Pascal Tougas, will provide more color on this in his comments. Excluding this charge, adjusted gross profit would have returned performance near the 30% mark. Adjusted EBITDA loss in Q1 2024 showed a small improvement when compared with the adjusted EBITDA loss of Q1 2023, approximately 6%. But more importantly, the improvement was much more significant when compared with the previous quarter, Q4 2023, with a decrease of 54%. While cost reduction measures implemented in Q4 2023 started to have some impact in Q1 2024, their benefit will be felt starting in Q2 2024 and will continue ramping up throughout the rest of the year. Combining all these factors and measures, we also expect to see our key financial metrics sequentially improving throughout 2024, with the full effect starting to show in Q3 2024.
With nine commercial products spread across three business units, we intend to continue focusing on the key drivers that will impact our financial performance and accelerate our transition to positive cash flow. I'll do a brief business unit overview. As you know, we have three business units, the first being our respiratory unit. Our two advanced asthma therapies, EnerZair and Atectura, continue to lead the way as revenue drivers for Valeo as a first-in-class fixed triple combination and a best-in-class fixed dual combination therapy, respectively. With the Canadian asthma market now valued at over CAD 1 billion annually and with several established brands relying on more conventional inhaled dual therapy, we believe that EnerZair is the right product to challenge the established order. As a result of their strong therapeutic value and our ongoing commercial activities, EnerZair and Atectura continue to demonstrate significant monthly prescriber and prescription growth.
At the end of the first quarter, the number of prescribing physicians who have prescribed EnerZair and Atectura reached 3,472, representing a 17% growth from the end of the prior quarter and a 119% increase over the prior year. This increase was seen across both specialty and primary care physicians as we focus on ensuring physicians are educated on the unique benefits that EnerZair's triple therapy provides. Increased physician adoption has driven total prescriptions for the last 12 months ended January 31st, 2024, to over 78,000, an increase of 130% year-over-year. We are very pleased with our rapid prescriber and prescription growth and expect that EnerZair's adoption rate will continue to climb for many quarters to come.
As we've said from the outset, we continue to forecast that these two asthma therapies can attain sales of CAD 100 million, putting them on par with many of their peers in the class. Hospital unit. Redesca, the mainstay of our hospital unit, is a hospital-based anticoagulant and remains the number one low-molecular-weight heparin biosimilar in Canada. The Canadian low-molecular-weight heparin market is undergoing dramatic change with the introduction of biosimilars. Canadian provinces have moved quickly to favorably open their markets to biosimilars, which provide significant cost savings as well as ensuring product availability for this very important class of drugs. Ontario, which represents approximately 45% of the overall Canadian low-molecular-weight heparin market, has now advanced its biosimilar policy to be on par with the other Canadian provinces.
This shift provides Valeo with a major opportunity to introduce Redesca to Ontario hospitals, enabling them to access the pricing and other benefits that Redesca provides. In addition, we are seeing Enoxaparin biosimilars competing in the market held by other biological anticoagulants, the so-called secondary market, which will expand the market potential for Redesca across Canada in the coming quarters. As mentioned at the outset, our hospital sales, primarily Redesca, experienced a slight decline in Q1 compared to Q4 2023 as changes in inventory levels made their way through hospital networks. Q2 shipments to date are displaying strong growth, and we expect Redesca to be an important sales contributor this year due to the Ontario market changes that we announced, that I mentioned earlier. Finally, our ophthalmology unit.
In February of 2024, we announced that we had entered into an amendment of our commercialization and supply agreement with Novartis Canada for both Xiidra and Simbrinza. As per the amendment, Valeo will continue to distribute Xiidra for a transition period, which is expected to continue until approximately Q3 2024. Our rights regarding Simbrinza are unchanged, and we will continue to commercialize and promote Simbrinza on an exclusive basis for the remainder of the contract term. Within 60 days of the date of termination of our agreement with Xiidra, Valeo will be entitled to a reimbursement of a residual portion of the upfront fee originally paid by Valeo. This amount, which we believe will be received sometime during the course of the summer, will be used for partial repayment of the secured term loan entered into between Valeo and Sagard Healthcare Royalty Partners in July 2022.
We continue to believe that our ophthalmology business unit can play an increasing role in the future success of Valeo, and that, as a key therapeutic area for Valeo going forward, it is particularly well-suited to accommodate additional products. As mentioned on previous quarterly calls, our business development activities are heavily focused on expanding our ophthalmology portfolio, and we continue to assess and have discussions on a number of potential product additions. Over the course of the last three years, Valeo has focused on building scale through products, revenue, and people. With that successfully accomplished, we are now single-mindedly focused on cash flow and profits. Cost reduction measures are now in place, and the positive anticipated benefits thereof are starting to materialize.
While organic revenue growth is the backbone on which we are building a solid foundation, we intend to do more to demonstrate improved and accelerating financial performance in the quarters to come. I would like to wind up my portion of this call by paying tribute to the entrepreneurial women and men whose daily efforts make Valeo Pharma one of the fastest-growing healthcare companies in Canada. Valeo brings innovation to Canadians, and innovation means better healthcare. And with that, I'll turn over the financial portion of the call to Pascal Tougas, our CFO.
Thank you, Steve. So we'll start with quickly reviewing our First Quarter of 2024 Results. So starting with revenues. For the quarter, we're in the vicinity of CAD 13.5 million compared to CAD 13.1 million in the prior quarter, comparable, of 2023, representing roughly 3% increase. Considering Q1 2023 captured nearly CAD 600,000 benefit of a competitor backorder, the adjusted growth would turn up at 7% and would be more indicative of the actual year-over-year performance. Commercial conditions, as you'll probably recall, we had a capture issue in Q4 of 2023. And for Q1 of 2024, the gross to net, call it, or the commercial conditions that we're provisioning for are more indicative of the existing commitments and sales makes. And so in comparison with Q4 2023, there are no material adjustments that were required on a catch-up basis, whether for returns or rebates.
From there, the gross profit was CAD 2.3 million for the quarter, slightly down from the CAD 3.4 million comparable quarter prior year, 34% decrease. A fair portion of the Q1 2024 gross profit is depressed by write-offs associated with launch grants, as mentioned by Steve earlier, which totaled nearly CAD 1.1 million, and thus reflecting on an adjusted gross profit at nearly CAD 3.9 million, which would put us nearly aligned to Q1 2023. In addition, considering Q1 2023, the backorder benefit that was materializing on non-recurring gross profit, the year-over-year basis would represent an upward trend at nearly 5%-7% on an adjusted basis. Moving on to operating expenses. For the quarter, materialized at CAD 7.1 million, so 2% down on a year-over-year basis.
Almost all functions are now showing OpEx decrease on a year-over-year basis, while still presenting or capturing severances associated with transformation that are embedded on a straight line. So G&A still representing and capturing the severances and other transformation costs part of OpEx. The corporation has also incurred transformation costs nearing CAD 200,000 for the quarter. So excluding severances and the said transformation cost, the OpEx would reflect more, an 8% reduction on a year-over-year basis. As a caveat or an element to look for, please do see note number 2 to our financial statements where we've made some presentation reclassification. So there's no EBITDA, net profit or loss, presentation element or impact. It's purely a reclass within lines of the P&L. Net loss for the quarter was CAD 6.9 million, CAD 600,000 vis-à-vis to same quarter of 2023, 10% increase in net loss.
Again, the year-over-year performance was negatively impacted by Q1 2023, so the non-recurring backorder benefit, and the Q1 2024, write-offs, which are both trickling down from the negatively impacted gross profit. At EBITDA level, despite the headwinds encountered in Q1 2024, the loss remains nearly unchanged versus Q1 2023, mainly supported by a non-recurring other income associated with disposal of a non-core asset and the cost recovery associated to the transition for Xiidra. Finally, looking at the cash position and cash burn for the quarter, at the end of January, our cash position was CAD 9.6 million, CAD 2.1 million increase year over year, and the cash generated by the operating activities in the quarter is just under CAD 0.2 million, an improvement of CAD 11.3 million on a year-over-year basis. However, that change is essentially tied to changes in non-cash working capital.
Finally, after foreign exchange impact, investing and financing activities represent nominal variances. This concludes the financial review part. Back for questions later on. So for now, I'll end it over back to Steve for remarks. Thank you, and over to you, Steve.
Great. Thanks, Pascal. We are now ready to open the call for questions. Although this portion of the call is reserved for questions from our financial analysts, we invite any of our shareholders or any other interested parties to contact us directly with any questions they may have, and we will get back to you as quickly as we can. Operator, you may now proceed with the questions part of this call.
Thank you, ladies and gentlemen. Should you have a question, please press the star followed by the 1. If you'd like to withdraw your question, please press the star followed by the 2. Again, to ask a question, press star 1. Your first question comes from Stefan Quenneville from Echelon Capital Markets. Please go ahead.
Hi, guys. Thanks for taking the question. My first question is about the asset sort of divestiture that you guys announced, subsequent to the quarter. Can you talk a bit about that and maybe give us a sense of what the revenue run rate was on that asset?
Maybe Pascal, you could handle that. I mean, the product we divested was sodium cromoglicate . So sodium cromoglicate is a generic injectable. It's a legacy product that we, from many years back, we had the Canadian and U.S. rights. We sold the Canadian rights in November to a Canadian company and then sold the U.S. rights to the same Canadian company, more recently, subsequent to the quarter end. Pascal, you want to add anything to that?
If I simply go to the annual rate. So Stefan, you probably know this, but it's this whole piece was an element where we were doing a pickup on revenue where the partner in the U.S. was actually commercializing this for us. And so the average revenue on a yearly basis would have, you know, been circa about $1 million.
The bottom line, we probably sold it 4-5 times what our earnings contribution was, closer to the 5 times. There was a lot of expenses. In Canada, we basically weren't making money with this product. And in the U.S., a single-store small product has a lot of fees attached to it. So, it was a, you know, it provided some cash, and it goes along our strategy. When I talk about we have nine products, we actually have several more than that, but the non-core is to basically clean up our operations and our product portfolio with products that are not key for our future. And in the same time, it generates a small amount of cash.
At the end of the day, it's still conducive of, you know, going back to relentless focus, focusing on what we want to do for the future and what we think is accretive.
Yeah.
Oh, great. My next question is just a bit on your sort of working capital management. You guys, I mean, during the quarter, I would say somewhat surprisingly, you know, added to your cash balance. Do you want to talk about what's going on there? You know, you have a, you know, big increase in payables. Are you working with suppliers? Is Novartis sort of working with you to, you know, run down the Xiidra inventory? Can you just give us some color on what's happening there?
Sure. I can provide a bit of context to that, Stefan. So obviously, as you'll know, I can't necessarily go into which partners, and you won't mind about that one, I hope. But yes, there are some arrangements that we're seeking with some of our partners to actually provide some flexibility on the first part. Second part is, there's a seasonality to this, in the sense that as our distribution center is actually closed in the last two weeks of December, we're actually, you know, collecting a lot of dollars into January. So it puts us in a position where it's a high cash moment, call it that way, considering that there's a rather high procurement season coming after with regards to inventory and cost of goods, in terms of mobilization.
that comes in after for the next two, three months, call it. Does that make sense?
Yeah. No. Yeah. That makes a lot of sense. And then I guess my final question is on the sort of business development or maybe even further divestitures on the sort of slower growth part of the portfolio. In your MD&A, you know, state pretty clearly that you're in active discussions for different opportunities. You know, obviously, there is stuff ongoing. You've been very clear about that. Do you want to characterize, in some way, you know, what's going on and maybe help us understand when something may occur? Just maybe a little more detail in the update on the business development front.
Yeah. You know, it's always, you know, as you just mentioned, it's ongoing. But what we have, what we can say is we've found some assets. We've assessed these assets. We're negotiating or negotiated on those assets, and we want to move forward. And I think, we'd like something to happen in the next quarter, like 90 days, basically. Now, we're trying to find, as you mentioned or as we've mentioned in the past, we're trying to find assets that can be immediately accretive, but they must fit with our business operations. So things that plug in with our existing sales and commercial infrastructure have strong priority for us.
We believe that there are some licensable assets that fit that category that we're involved with or in discussions with, immediately accretive versus development assets where typically the revenues are only going to start to flow in, you know, 24-36 months. Really focus on cash flow, which you know has been a while coming. I mean, I think just to make a comment on that with Redesca, just maybe preempt someone else's comments, you know, what we expected to happen in Ontario last year in terms of the adoption of a biosimilar policy was, in fact, enacted last year but did not flow through to Enoxaparin, which is the biosimilar that we have. They focused mostly on chronic therapy. Those were the first ones. We're now starting to see that change.
We are in active discussions with pretty well every hospital mind group in Ontario or hospital group in Ontario or hospital in Ontario. And there's going to be a major shift that's going to happen this year. And we're already starting to see it. So we're very optimistic about, about what Redesca could do this year. Although, frankly, if you turn back, we, we expected that to happen last year. And unfortunately, there was a one-year delay, which obviously significantly impacted our, our ability to get the EBITDA positive in that because Redesca will play a big role in getting to EBITDA positive.
Great. That's it from me, guys. Thanks.
Great. Thanks, Stefan.
Ladies and gentlemen, as a reminder, should you have a question, please press the star followed by the 1. Your next question comes from Scott McAuley from Paradigm Capital. Please go ahead.
Thanks. Good morning, guys. So just first for me, just on the write-downs, I know you'd mentioned the kind of improved processes, but we saw a similar write-down last quarter. Is this something that, you know, we shouldn't see going forward, or is it just we could see less of going forward as these things normalize?
So that's, I'll take this one, Steve. Good morning, Scott. Hope you're doing well. Yeah, the whole situation there is a bit concerning. Steve did speak to early on new controls that we're putting in place, and so on and so forth. Look, in transparency, the major portion of what we have in there is tied to Allerject, so vicinity of maybe CAD 700 thousand-CAD 800 thousand. And it's tied to decisions that were made before last fall, because we have a long lead time on this one. Yeah, it's tied to product lineup. And I would say the balance, not all of the balance, but a portion of the balance is actually tied to hospital portfolio.
But in that case, it's something that dates back from 2+ years, and was associated to launch timeline and assessments from that end. So obviously, as we look to evolve and try to marry our procure to pay processes, look, with the background that I have, I'm actually coming in and suggesting it's not only that, it's a forecast to procure to sell. And it's a much longer type of process that you're looking into. But in doing it that way, you only procure to actually serve the demand that you're expecting on a shorter type of loop. And you're looking for more velocity throughout your inventory despite the rather long timelines.
But at the same time, it's the preventing the bolus effect and the fact that we're not going to have, let's call it this way, development the assets that we're going to be looking at. We will be less exposed to those new launches where your risk of delta between expected forecast and execution. Generally, whether you are in the big pharma or a smaller pharma, you're always exposed to those big write-offs at some point during the launch phase. So that will help us, definitely. Obviously, it's going to be less of a burden on the working capital.
Yeah. We do expect that there's going to be some additional small write-offs in Q2, probably in the vicinity of about CAD 400,000. And again, it's tied to essentially two products. One, which, as Cal mentioned, goes back a while, and it's, there was packaging issues and things of that nature, which resulted in some inventory not being really available for sale. And the allergy product, which we love I mean, the product's doing well for us. It there's some challenges that I don't think that we fully accepted or understood in the startup phase. And unfortunately, that resulted by the time we came to light, we were already committed to inventory. So I would expect to see that drop significantly. Maybe we'll never get rid of it totally, but it'll drop significantly.
That product is a profitable product for us, so, without these write-offs. So we expect, you know, but the magnitude is, I believe, terrible. I mean, it's, we've written off between the fourth quarter and the first quarter of this year over CAD 2 million of this product. And that will not happen anywhere as close to that again. So, that's, that's probably the summary on that. It should not be a major expense for us, this write-off. And yet, it is. And, we've done things and made the changes to make sure it never happens again, however, you know, write-offs do happen for a number of reasons, but they should be a small percentage of your sales and not as significant as this.
Yep. Thanks. That makes sense. I think I've kind of asked on this before, but, you know, it's always positive to see the increasing number of prescribers, the increased number of prescriptions for the Enerzair and Atectura products. And you kind of highlighted that those are the growth products. But if you kind of look at the different divisions, you know, it doesn't seem like those growths kind of line up. And I know there's, you know, lead times and a lot like, there's a lot of moving parts.
But maybe kind of in a simple way, could you describe how you think about, you know, when you're seeing those increasing numbers, you know, how you kind of can use those or to inform what you're thinking around revenue expectations for those two products since they are such a major component of the story?
Yeah. Well, you know, we're talking really, you know, again, Enerzair and Atectura are two asthma therapies. What you have to look at is these are relatively inexpensive drugs. So there's you, you need to move prescriptions considerably to get to where they're, these products will be break-even for us. But in the quarter, what you could pretty well look at is we had a significant increase in Enerzair and Atectura revenues, which was offset by a reduction of our hospital revenues and a reduction of our ophthalmic revenues. So unfortunately, there was kind of an offset in that in Q1. And that's why Q1 results demonstrated what I would consider pretty well flat, flat numbers from Q4 and from Q1 last year. But when I look at Q2, I see all our key products up significantly from Q1 in terms of the year-over-year growth.
I would expect that Q2 numbers should be significantly better than Q1. Still only halfway through the quarter. But you know, our expectation is these revenues will grow throughout the year. But Enerzair, and in particular, is starting to impact the top line. And you'll probably see it more in Q2 as a standalone in Q2. You know, we don't necessarily break out our revenues. We haven't historically or traditionally broken out our revenues by business unit. I think as the year goes on, whether it's in Q2 or potentially a bit later, it's not that we don't want to. We just want to make sure that it's not just meaningful, but it's representative.
And I think, you know, probably Q2, if not Q3, we are going to start—you'll be able to start tracking, rather than just prescription revenue, you'll actually be able to start tracking prescription growth. You'll actually be able to start tracking revenue growth for those products. And that'll give you a better idea. But, you know, again, it's—it's kind of a, you know, bittersweet. You know, you say +3, and my comment was really, it's not representative. If you look at the underlying products, I mean, Redesca had a—not the greatest quarter, but if you look at Q4, it had a fantastic quarter. And last year, it was aided by a stockout on Lovenox, which caused sales to jump significantly. So this year, we didn't have that stockout.
So it looks like it didn't have as great a Q1. But I can say that in Q2 to date, we're up about 40% over last year's Q2, roughly. I work off gross numbers because that's my data. And obviously, when you go to net, those numbers could vary. It could be 38. It could be 42. But, you know, it gives you a relevant sense that that's a significant jump over Q2 last year, which was still a good quarter for Redesca. So I think overall, our key brands, and those are Enerzair, Atectura, Allerject, Simbrinza, Redesca, you know, are all up. And, you know, I'll give you another one in ophthalmology.
Ophthalmology, we were, you know, as I mentioned, Xiidra, on the switchover, sales of Xiidra sort of tapered, I guess, some of our programs. So when I say programs, they would be sampling programs. They would be patient support programs. It would be copay programs. As they were handed off to Bausch + Lomb, and by the time they got up and running, there was a negative impact on Xiidra, where Xiidra sales were actually down from the corresponding period last year. Simbrinza also had what I would say a bit of a soft first quarter. You know, first quarter sales, let's say Simbrinza were basically flat from last year. Second quarter, year-over-year, we're up over 25%. And so that's a significant jump.
So the second quarter, our key brands are performing a lot better than they did in the first quarter and certainly than last year. So we're very optimistic about, about the growth. And that's why we talk about growth. And I know you're saying, "But I'm not seeing the growth." And it's frustrating for us too because it's other elements than these key brands that are pulling that are making the, you know, the, the it's we should almost put our financial statements of key brand revenue and then other revenue. And maybe that would show a better, sort of, in the or be a better indicator of the fact that we are growing.
Yeah. No, I appreciate this. Yeah, lots of moving parts. And sometimes, it's
Yeah. Exactly. Yeah.
Moving on underneath the water. Just third for me, you know, good to see that those operating expenses coming down and kind of highlighting that even with that, there's some, you know, one-time ask, you know, from that restructuring still in those numbers. So I don't know. Do you have, like, a target, like a either quarterly or annual kind of target that you're working towards for those operating expenses?
Well, we did indicate in a press release we'd like to cut by CAD 2 million. We actually believe we're way above that number, maybe closer to CAD 3 million. We believe we've done so in ways that don't affect commercial opportunity or the commercial success of our products. That's not to say we were bloated before, but I think we were moving towards, I think, a bit more of an operational entrepreneurial operational structure. I think before, we went towards this traditional big pharma structure with the silos and what have you. And that's because of maybe some management decisions made then. So we're really trying to get back to being a bit more of a cross-functional, leaner team in the field.
You know, we talked about focus on physicians, focusing on the physicians that are the higher prescribers and increasing frequency with those physicians as being key changes. So I think you'll continue, but as Pascal mentioned, you know, there is a cost. First of all, there's a cost to downsizing. There's severance costs and other associated costs. There's cost too of stopping programs because sometimes, you know, POs are issued. Work's been done by our suppliers. And, you know, it's nice to say, "Well, we're stopping." And then they still say, "Well, you still owe us so much money because we've spent this money. We haven't billed it to you yet." So that's what happened in the first quarter. Some will drag a bit into the second. And I think there was a comment made by myself, and I think Pascal too.
Q3 is where you're going to see more of a clean run rate, so really how, like, our OpEx should be. Our target is to get it down significantly from the numbers that we currently have and bring it, you know, if, you know, the target is CAD 6 million, you know, on total OpEx. That would be, I think, you know, the first level we want to get to. At some point, though, you need to have OpEx to support the operations that we have. And as we say, you know, if we are successful with our licensing, you know, we're actually increasing the workload internally with, or we could increase the workload internally with these products. But we're downsized to that level.
So, whatever we in-license will not require us to build out or upgrade or increase the resources within our company. So we're lean, but we're lean and ready to take more on and continue to grow, which should have a positive impact on the bottom line. Our forecast is positive EBITDA by the end of the year. You should see a significant improvement in the EBITDA loss in Q2 and even more so in Q3, as I mentioned, where the true full pass-through of all of those transition expenses has been absorbed previously.
Yep. Thanks, Steve. And I guess lastly, just on the convertible debt, you know, it's due by the end of the year. You know, excuse me. Any progress on kind of coming up with ideas or, or talking to people on getting through that?
Yeah. We've talked to all the big convertible debt holders that represent, I don't know, 75%-80% probably of the debt. And, you know, there's an openness there for further discussion. But, we're addressing it now. We think we should have some kind of definitive conclusion by the beginning of summer. And everyone seems to be happy with that timeline.
Good. Thanks, guys.
Thanks, Scott.
There are no further questions at this time. I will turn the call back over to Steve Saviuk, CEO, for closing remarks.
Thank you, operator. Well, thank you all for attending the 2024 conference call. As mentioned previously, we are quite pleased with our growth trajectory. The numbers, although they show +3%, significant underlying growth with certain assets. And in, as I mentioned, not that we're giving any forward guidance, but Q2, at least up to this point, which is 50% of the way through the quarter, our key growth drivers are kicking in significantly. So we're very happy with our results. More to do on the cost-cutting side. It never stops. I mean, you're always looking at ways to improve your operations. Bottom line, we realize that our shareholders and we want and we need to our other stakeholders, the company has to get the cash flow positive as quickly as possible.
That's clearly, as I mentioned, our single-minded objective in terms of being able to hit that in calendar 2024. We feel we have, you know, the right products, the right team, to be able to do so. So again, thank you for your continued interest and support. We look forward to keeping you updated on new developments and other catalysts. With that, I'll turn back to the operator. And again, want to thank you all for taking the time this morning to be with us.
Ladies and gentlemen, this concludes your conference call for today. We thank you for joining. You may now disconnect your lines. Thank you.