Annual Report 2024
Excellence Through Innovation®
Cosmetic Ingredients
Medical Lubricants
Pharmaceutical Products
Sexual Wellness Ingredients
OFFICERS AND DIRECTORS
CORPORATE PROFILE
DONNA VIGILANTE
President
PETER A. HILTUNEN
Senior Vice President
Production and Procurement
ANDREA YOUNG
Chief Financial Officer & Controller
Treasurer
Secretary
KEN GLOBUS
Chairman of the Board of Directors
ARTHUR M. DRESNER
Director; Counsel to the law firm of
Duane Morris LLP
New York, NY
LAWRENCE F. MAIETTA
Director; Partner in the accounting firm of
PKF O’Connor Davies, LLP
New York, NY
ANDREW A. BOCCONE
Director; Independent Business Consultant,
Former President of Kline & Company, Inc.
(business consulting firm), Little Falls, NJ
S. ARI PAPOULIAS
Director; Principal of ChemRise LLC
(a business advisory firm providing advice to
companies in the chemicals industry), Tarrytown, NY
CATHERINE KOLINSKI
Director; Independent Business Consultant,
Former Vice President of Ashland Specialty Ingredients
(manufacturer and distributor of specialty chemicals),
Bridgewater, NJ
United-Guardian, Inc. is a publicly-traded (NASDAQ:UG), fully integrated research, development, and manufacturing company that
has been supplying unique and innovative products to the personal care, health care, pharmaceutical, and industrial sectors since
1942. The company’s products are developed and manufactured by the company’s Guardian Laboratories Division at its 50,000
square foot facility in Hauppauge, New York. The cosmetic ingredients are marketed through a worldwide network of distributors
and are used by many of the major multinational cosmetic companies. The pharmaceutical products are sold primarily to full-line
drug wholesalers, which distribute them to pharmacies, hospitals, physicians, long-term care facilities, and other health care
providers. The health care products are primarily medical lubricants marketed directly to manufacturers of medical devices
and other medical products, which incorporate them into their finished products and distribute them to hospitals, pharmacies,
and other health care facilities. The specialty industrial line of products was discontinued after the second quarter of 2023. The
LUBRAJEL® line of hydrogels is the company’s most important product line and are used in both personal care and medical
products. Innovation is a central theme of United-Guardian’s strategy. The focus, at this time, is to continue expanding the pipeline
of classic and naturally derived hydrogel products to address unmet market and customer needs. Over the years, the company
has been issued over 32 patents. The company currently relies primarily on proprietary manufacturing methods and product
formulations, which are protected as trade secrets, rather than patent protection. United-Guardian has received ISO 9001:2015
registration from DQS Inc., indicating that the company’s documented procedures and overall operations have attained the very
high level of quality needed for this global certification level.
LETTER TO STOCKHOLDERS
Dear Stockholder:
I am pleased to report that 2024 was a stronger year for United-Guardian compared to 2023. We saw sales
improve in both the cosmetic and medical lubricant markets. While pharmaceutical sales did not fully recover
in 2024 due to a shutdown at our contract manufacturer for Renacidin®, we did start to recover from the deficit
that we had seen earlier in the year.
Net sales and net income increased from FY 2023 to FY 2024. Net sales increased by 12% from
$10,885,154 in 2023 to $12,181,971 in 2024 generating net income of $3,250,875 ($0.71 per share) in 2024
compared to $2,581,370 ($0.56 per share) in 2023. Sales of cosmetic ingredients and medical lubricants
increased by 32% and 16%, respectively. The increase in cosmetic ingredient sales was primarily due to
increased purchase orders from our largest distributor, Ashland Specialty Ingredients (“ASI”). ASI stated that
there was greater demand for our products in China as a result of regaining market share at certain key
accounts. The increase in medical lubricant sales was driven by greater demand from one of our large contract
manufacturer customers in China. Pharmaceutical sales decreased by 5% in 2024, due to a supply disruption
of Renacidin, our main pharmaceutical product, that we experienced at the end of 2023 and continued into the
first quarter of 2024. This disruption impacted our sales of Renacidin for 2024. Sales began increasing once
supply levels resumed and we saw a trend of returning sales as the year progressed. Our fourth quarter results
were not as strong as the previous quarters in 2024, and the primary reason for this decrease was due to ASI’s
ordering patterns. While sales to ASI’s customers remained steady, so did their inventory levels, which resulted
in a decrease in the purchase orders we received from them in the fourth quarter.
We are continuing to explore the market for Renacidin by gaining valuable insights into patient product access,
barriers limiting growth and brand awareness. Our next study, an investigation into the payer landscape, will
begin in the second quarter of 2025. This study will explore barriers that may exist for patients to access
Renacidin and develop strategies to mitigate the barriers, if present. We believe that obtaining a broader
understanding of Renacidin in the marketplace will allow us to expand our sales and reach more patients. These
studies are not only designed to increase our domestic market share but will allow us to demonstrate the potential
value this product may have across the globe. Our wider plan is to expand Renacidin outside the United States,
and we believe the information generated from our research will put us on a trajectory to accomplish that goal.
We have been actively working with our distributors to seek opportunities to expand our market position.
We recently signed a distribution agreement with Azelis Group NV (“Azelis”) for an additional territory, South
Korea. The Korean market is at the forefront of innovation in the skin care category, and the Azelis team is
ideally suited to introduce our products to new customers. Azelis has already begun introducing our ingredients
to their customers and we are hopeful that we will gain greater market share in this territory. We continue
to have discussions with ASI on a new distribution agreement for our cosmetic ingredients. While finalizing
this agreement has taken longer than expected, we are actively working with ASI to negotiate the terms
of our agreement. We are hopeful that an agreement will be signed later this year. We continue to conduct
business with ASI as we have previously, by fulfilling orders and discussing marketing strategies. We have been
United-Guardian, Inc. Annual Report 2024 1
2 United-Guardian, Inc. Annual Report 2024
discussing the topic of tariffs with our distributors as well as internally. The situation remains fluid and is
subject to change. We are continuing to monitor the situation closely, and we will update our stockholders
on the potential impact on our business, if any, in the next stockholders’ letter.
Our Natrajel® line of sexual wellness ingredients was first introduced to the market in late 2023 and
has been steadily gaining interest from customers. Brenntag Specialties (“Brenntag”), our marketer and
distributor of the sexual wellness line in the Americas, has been promoting these products at trade shows
and during customers visits. We have received positive feedback and interest, which we believe will put us
in a strong position for growth as this market continues to gain traction among consumers. While all new
products take time to grow, we have been very encouraged by the number of sample requests we have
received so far and are hopeful we will receive orders for these products in 2025. We are still in the process
of negotiating an extension to our current agreement for an additional territory in Europe.
We are excited to report that our marketing agreement with Azelis for our medical lubricant products in
the UK and Ireland has been executed. Azelis has strong relationships with customers in the medical market
and believes that our products are a natural fit for unmet needs within several medical categories. We are at
the beginning of this process, and are preparing documentation, providing training materials and developing
a marketing strategy. We will provide updates as we move forward.
Finally, our research and marketing teams continue to develop ingredients and promote existing products
to new customers. Based on feedback from our customers and distributors, we know that our Lubrajel®
line of products provide multifunctional benefits with hydration, lubrication and sensory at the forefront.
We have several new products in the later stages of development and will be providing samples to our
distributors for feedback in the coming months. The products include a skin care ingredient designed for
longer hydration benefits, a hair care ingredient that meets the growing need for natural ingredients and a
new Natrajel ingredient for the sexual wellness market that addresses an unmet need. Our marketing team is
creating documentation needed to provide a robust promotional effort, and we will provide additional updates
once these products are launched. In addition, we are continuing to develop new products for our medical
customers with several projects in various stages of development and our marketing team will be creating
brochures, sample kits and training presentations to further expand our presence in the medical market.
We are still following our growth plan, which we believe is the best way to provide consistent growth
to our stockholders. Our plan began in the second half of 2023 by identifying pathways for growth and
expansion within our current markets. In 2024, we implemented key steps in our growth plan by adding
marketing capabilities, signing a new distribution agreement, conducting studies to further our knowledge
base, and assessing our commercialization channels. We believe that the core steps in our growth plan are
in place, and we will continue to implement the changes needed to support our goal of growing the business.
Sincerely,
UNITED-GUARDIAN, INC.
Donna Vigilante
President
United-Guardian, Inc. Annual Report 2024 3
STATEMENTS OF INCOME
Years ended December 31,
2024
2023
Net sales
$ 12,181,971
$ 10,885,154
Costs and expenses:
Cost of sales
5,721,584
5,479,566
Operating expenses
2,356,819
2,078,564
Research and development
456,779
463,992
Total costs and expenses
8,535,182
8,022,122
Income from operations
3,646,789
2,863,032
Other income:
Investment income
434,679
306,651
Net gain on marketable securities
26,989
81,095
Total other income
461,668
387,746
Income before provision for income taxes
4,108,457
3,250,778
Provision for income taxes
857,582
669,408
Net income
$3,250,875
$ 2,581,370
Earnings per common share (basic and diluted)
$
0.71
$
0.56
Weighted average shares (basic and diluted)
4,594,319
4,594,319
See Notes to Financial Statements
4 United-Guardian, Inc. Annual Report 2024
BALANCE SHEETS
ASSETS
December 31,
2024
2023
Current assets:
Cash and cash equivalents
$ 1,875,655
$ 8,243,122
Marketable securities
7,522,625
851,318
Accounts receivable, net of allowance for credit losses
of $14,342 in 2024 and $16,672 in 2023
1,428,455
1,566,839
Inventories, net
1,451,995
1,223,506
Prepaid expenses and other current assets
207,804
191,708
Prepaid income taxes
179,017
176,220
Total current assets
12,665,551
12,252,713
Deferred income taxes, net
175,397
50,930
Property, plant, and equipment:
Land
69,000
69,000
Factory equipment and fixtures
4,743,238
4,669,936
Building and improvements
3,336,352
2,976,577
Total property, plant, and equipment
8,148,590
7,715,513
Less accumulated depreciation
7,192,203
7,096,318
Total property, plant, and equipment, net
956,387
619,195
TOTAL ASSETS
$13,797,335
$ 12,922,838
See Notes to Financial Statements
United-Guardian, Inc. Annual Report 2024 5
BALANCE SHEETS
LIABILITIES AND STOCKHOLDERS’ EQUITY
December 31,
2024
2023
Current liabilities:
Accounts payable
$
425,003
$
134,449
Accrued expenses
1,467,933
1,363,044
Deferred revenue
—
15,498
Dividends payable
21,533
21,265
Total current liabilities
1,914,469
1,534,256
Total liabilities
1,914,469
1,534,256
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.10 par value; 10,000,000 shares
authorized; 4,594,319 shares issued and outstanding at
December 31, 2024 and 2023, respectively
459,432
459,432
Retained earnings
11,423,434
10,929,150
Total stockholders’ equity
11,882,866
11,388,582
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
$13,797,335
$ 12,922,838
See Notes to Financial Statements
6 United-Guardian, Inc. Annual Report 2024
STATEMENTS OF STOCKHOLDERS’ EQUITY
Years ended December 31, 2024 and 2023
Common stock
Retained
Shares
Amount
earnings
Total
Balance, January 1, 2023
4,594,319
$459,432
$ 8,807,212
$ 9,266,644
Net income
—
—
2,581,370
2,581,370
Dividends declared, not paid
($0.10 per share)
—
—
(45)
(45)
Dividends declared and paid
($0.10 per share)
—
—
(459,387)
(459,387)
Balance, December 31, 2023
4,594,319
$459,432
$ 10,929,150
$ 11,388,582
Net income
—
—
3,250,875
3,250,875
Dividends declared, not paid
($0.60 per share)
—
—
(268)
(268)
Dividends declared and paid
($0.60 per share)
—
—
(2,756,323)
(2,756,323)
Balance, December 31, 2024
4,594,319
$459,432
$ 11,423,434
$ 11,882,866
See Notes to Financial Statements
United-Guardian, Inc. Annual Report 2024 7
STATEMENTS OF CASH FLOWS
Years ended December 31,
2024
2023
Cash flows from operating activities:
Net income
$ 3,250,875
$ 2,581,370
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization
95,885
105,682
Gain on sale of asset
—
(10,000)
Net gain on marketable securities
(26,989)
(81,095)
Allowance for credit losses
(2,330)
(3,391)
Allowance for obsolete inventory
(14,208)
(17,000)
Deferred income taxes
(124,467)
59,614
Decrease (increase) in operating assets:
Accounts receivable
140,714
(135,872)
Inventories
(214,281)
465,506
Prepaid expenses and other current assets
(16,096)
10,138
Prepaid income taxes
(2,797)
9,008
Increase (decrease) in operating liabilities:
Accounts payable
290,554
104,034
Accrued expenses
104,889
40,988
Deferred revenue
(15,498)
15,498
Net cash provided by operating activities
3,466,251
3,144,480
Cash flows from investing activities:
Acquisitions of property, plant and equipment
(433,077)
(165,716)
Proceeds from sale of asset
—
10,000
Purchases of marketable securities
(8,459,318)
(621,852)
Proceeds from sales of marketable securities
1,815,000
5,505,145
Net cash (used in) provided by investing activities
(7,077,395)
4,727,577
Cash flows from financing activities:
Dividends paid
(2,756,323)
(459,387)
Net cash used in financing activities
(2,756,323)
(459,387)
Net (decrease) increase in cash and cash equivalents
(6,367,467)
7,412,670
Cash and cash equivalents, beginning of year
8,243,122
830,452
Cash and cash equivalents, end of year
$ 1,875,655
$ 8,243,122
Supplemental disclosure of cash flow information:
Taxes paid
$ 1,050,795
$ 600,000
Supplemental disclosure of non-cash items:
Dividends payable
$
268
$
45
See Notes to Financial Statements
8 United-Guardian, Inc. Annual Report 2023
NOTES TO FINANCIAL STATEMENTS
NOTE A
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Business
United-Guardian, Inc. (“Registrant” or “Company”)
is a Delaware corporation that, through its Guardian
Laboratories division, manufactures, markets and
develops specialty cosmetic ingredients, pharmaceutical
products, medical lubricants and sexual wellness
ingredients. Prior to July 1, 2023, the Company
manufactured and reported sales of a line of specialty
industrial products; however, this product line was
discontinued after the second quarter of 2023 due
to low sales volume with no growth prospects.
The Company also conducts research and product
development, primarily related to the development of
new and unique cosmetic ingredients. The Company’s
research and development department also modifies,
refines, and expands the uses for existing products,
with the goal of further developing the market for
the Company’s products. Two major product lines,
Lubrajel and Renacidin Irrigation Solution (“Renacidin”)
together accounted for approximately 93% and 92% of
the Company’s sales for the years ended December 31,
2024 and December 31, 2023, respectively. Lubrajel
accounted for approximately 60% and 54% of the
Company’s sales for the years ended December 31,
2024 and December 31, 2023, respectively, and
Renacidin accounted for approximately 33% and 38% of
the Company’s sales for the years ended December 31,
2024 and December 31, 2023, respectively.
Segment Information
The Company operates its business under one
operating segment, which is also its reportable
segment. The Company’s chief operating decision
maker (“CODM”), who is the President, reviews financial
information presented at the consolidated level and
decides how to allocate resources based on financial
metrics, including net income. The measure of
segment assets is reported on the balance sheet
as total consolidated assets. The CODM, along with
the Board Of Directors, use such financial metrics,
including net income, to evaluate income generated
from segment assets (return on assets) in deciding
whether to reinvest profits or allocate to other parts
of the organization, such as working capital needs,
mandatory and discretionary capital expenditures or
other growth opportunities that may arise that are
in the Company’s best interest and the best interest
of the stockholders.
Net income, other financial metrics and sales
forecasts are used to monitor budget versus actual
results. The reported segment revenue, segment
profit or loss and significant segment expenses are
the same as the consolidated results disclosed on
the consolidated statements of income.
Impact of Global Supply Chain Instability, Inflation
and Tariffs
The continued supply chain instability, primarily
caused by military tensions in the Middle East,
continues to impact vessels’ access to the Red Sea
and Suez Canal. Shipping experts say this crisis
may last into the first half of 2025. The Company
continues to work with its suppliers regarding lead
times and is closely monitoring this situation. Although
the Company has not yet experienced any delays in
receiving raw materials or an increase in shipping
costs, the Company is aware that the situation is
fluid and could impact it at any time. If that occurs,
the Company may experience longer lead times and
increased shipping costs for some of its raw materials,
which may impact future gross margins. As a result
of this global supply chain instability, there continues
to be uncertainty regarding the potential impact on
the Company’s operations or financial results and its
unable to provide an accurate estimate or projection
as to what the future impact will be.
The Trump administration has communicated its
intention to impose tariffs on many products imported
from China, Canada and Mexico. Some of those tariffs
went into effect on March 4, 2025. Since that time
the Trump administration has increased some of those
tariffs and postponed others. It has threatened to
United-Guardian, Inc. Annual Report 2023 9
levy tariffs on additional countries, including those of
the European Union. Many of the countries on which
those tariffs have been levied have imposed their own
retaliatory tariffs or threated to impose tariffs on goods
they import from the U.S. The tariff situation remains
fluid and is subject to modification at any time. At this
time, it is difficult for the Company to determine the
impact of these tariffs on its business. The Company
will continue to monitor this situation closely.
While the Company obtains most of its raw
materials and lab supplies from domestic sources,
it has three suppliers that obtain their raw materials
from China. These materials are not purchased by
the Company in large quantities, and it has adequate
stock on hand to cover the next six months. In addition,
the Company has one direct raw material supplier
in China; however, the raw materials purchased from
this supplier are not in large quantities and the effect
of this tariff would not materially impact the pricing
of its products.
Many of the Company’s products are used in the
formulation of finished products that are manufactured
in China and then imported back into the United States
(“U.S.”) for sale. There is the possibility that the tariffs
levied on these finished products could result in an
increase in their price, which could potentially impact
demand for these products in the U.S.
Due to the continued uncertainty of this, any
other tariffs that may be imposed, there continues
to be uncertainty regarding the future impact of any
additional tariffs on the Company’s operations or
financial results.
Use of Estimates
In preparing financial statements in conformity
with a Generally Accepted Accounting Principles in the
United States of America (“US GAAP”), management
is required to make estimates and assumptions that
affect the reported amounts of assets and liabilities
and the disclosure of contingent assets and liabilities
at the date of the financial statements and revenue and
expenses during the reporting period. Actual results
could differ from those estimates. Such estimated
items include the allowance for credit losses, reserve
for inventory obsolescence, accrued distribution fees,
outdated material returns, possible impairment of
marketable securities and the allocation of overhead.
Accounts Receivable and Reserves
In accordance with FASB ASC Topic 326, “Financial
Instruments—Credit Losses (Topic 326): Measurement
of Credit Losses on Financial Instruments”, (“ASC 326”),
the Company presents financial assets at the net
amount expected to be collected, requiring immediate
recognition of estimated credit losses expected to
occur over the asset’s remaining life. This is in contrast
to previous U.S. GAAP, under which credit losses were
not recognized until it was probable that a loss had
been incurred. The Company performed its expected
credit loss calculation based on historical accounts
receivable write-offs, including consideration of then-
existing economic conditions and expected future
conditions. The adoption of this ASU did not have a
significant impact on the financial statements. Prior to
the implementation of ASU No. 2016-13, the Company
calculated its reserve for accounts receivable by
considering many factors including historical data,
experience, customer types, credit worthiness and
economic trends.
The carrying amount of accounts receivable is
reduced by an allowance for credit losses that
reflects the Company’s best estimate of the amounts
that will not be collected as of the balance sheet
date. This allowance is based on the credit losses
expected to arise over the life of the asset and is based
on the Current Expected Credit Losses (“CECL”). At
December 31, 2024 and 2023, the allowance for credit
losses related to accounts receivable amounted to
$14,342 and $16,672, respectively.
Revenue Recognition
The Company records revenue in accordance
with ASC Topic 606 “Revenue from Contracts with
Customers.” Under this guidance, revenue is recognized
when a customer obtains control of promised goods or
services, in an amount that reflects the consideration
expected to be received in exchange for those goods or
services. The Company’s principal source of revenue is
product sales.
The Company’s sales, as reported, are subject to
a variety of deductions, some of which are estimated.
These deductions are recorded in the same period in
which the revenue is recognized. Such deductions,
primarily related to the sale of the Company’s
pharmaceutical products, include chargebacks from
the United States Department of Veterans Affairs
10 United-Guardian, Inc. Annual Report 2023
(“VA”), rebates in connection with the Company’s
current participation in Medicare programs, distribution
fees, discounts, and outdated product returns.
These deductions represent estimates of the related
obligations and, as such, knowledge and judgment are
required when estimating the impact of these revenue
deductions on sales for a reporting period.
During 2024 and 2023, the Company participated
in various government drug rebate programs
related to the sale of Renacidin, its most important
pharmaceutical product. These programs include the
Veterans Affairs Federal Supply Schedule (“FSS”), and
the Medicare Part D Coverage Gap Discount Program
(“CGDP”). These programs require the Company to sell
its product at a discounted price. The Company’s sales,
as reported, are net of these rebates, some of which
are estimated and are recorded in the same period that
the revenue is recognized.
On January 1, 2025, the Centers for Medicare &
Medicaid Services (“CMS”) implemented a new
Medicare Part D Manufacturer Discount Program
(“Discount Program”), which replaced the prior CGDP.
The new Discount Program eliminates the coverage
gap benefit phase, introduces pharmaceutical
manufacturer discounts in the initial and catastrophic
coverage phases, and lowers the cap on enrollee out-
of-pocket costs. Under the new Discount Program,
additional rebates are expected to be owed by
pharmaceutical manufacturers due to the restructuring
of the benefit periods and removal of the cap that was
in place that limited the drug manufacturer’s liability.
The overall financial impact of this new program will
vary depending on the products being reimbursed
but is expected to increase Medicare Part D rebates
for drug manufacturers. On January 31, 2024, the
Company was notified by CMS that it qualified as a
“specified small manufacturer” and would be entitled
to a multi-year phase-in period during which it
would pay a lower percentage discount on drugs
dispensed to beneficiaries. Based on the “specified
small manufacturer” designation, it appears, that
based on our current level of sales through the
Medicare Part D Program, the Company would have
reduced rebate liabilities in years 2025 and 2026,
with rebates gradually increasing each year until they
reach their full value in 2031. By the end of the phase
in period in 2031, these rebate liabilities are expected
to significantly exceed the liabilities we have recorded
under the CGDP in previous years.
As long as a valid purchase order has been
received and future collection of the sale amount
is reasonably assured, the Company recognizes
revenue from sales of its products when those
products are shipped, which is when the Company’s
performance obligation is satisfied. The Company’s
cosmetic products are shipped EXW from the
Company’s facility in Hauppauge, NY, and the risk of
loss and responsibility for the shipment passes to the
customer upon shipment. Sales of the Company’s
non-pharmaceutical medical products are deemed
final upon shipment, and there is no obligation on the
part of the Company to repurchase or allow the return
of these goods unless they are defective. Sales of the
Company’s pharmaceutical products are final upon
shipment unless (a) they are found to be defective;
(b) the product is damaged in shipping; (c) the product
cannot be sold because it is too close to its expiration
date; or (d) the product has expired (but it is not more
than one year after the expiration date). This return
policy conforms to standard pharmaceutical industry
practice. The Company estimates an allowance for
outdated material returns based on previous years’
historical returns of its pharmaceutical products.
The Company does not make sales on
consignment, and the collection of the proceeds of
the sale of any of the Company’s products is not
contingent upon the customer being able to sell the
goods to a third party.
Any allowances for returns are taken as a
reduction of sales within the same period the revenue
is recognized. Such allowances are determined based
on historical experience under ASC Topic 606-10-32-8.
At December 31, 2024 and 2023, the Company had an
allowance of $276,732 and $247,847, respectively, for
possible outdated material returns, which is included in
accrued expenses. There is no asset value associated
with these outdated material returns, as these products
are destroyed.
United-Guardian, Inc. Annual Report 2023 11
The timing between recognition of revenue for
product sales and the receipt of payment is not
significant. The Company’s standard credit terms,
which vary depending on the customer, range
between 30 and 60 days. The Company recognizes an
allowance for credit losses on its accounts receivable
in accordance with ASU 2016-13, which is based on the
credit losses expected to arise over the life of the asset
and is based on Current Expected Credit Loss (“CECL”).
Prompt-pay discounts are offered to some customers;
however, due to the uncertainty of the customers
taking the discounts, the discounts are recorded when
they are taken.
At December 31, 2023, the Company recorded
advance payments from two of its customers in the
amount of $15,498, which was recorded as deferred
revenue on the balance sheet. The related performance
obligations associated with these payments were
satisfied in the first quarter of 2024. No such advanced
payments existed at December 31, 2024.
The Company has distribution agreements with
certain distributors of its pharmaceutical products that
entitle those distributors to distribution and services-
related fees. The Company records distribution fees,
and estimates of distribution fees, as offsets to
revenue.
Disaggregated net sales by product class are as
follows:
Years ended December 31,
2024
2023
Cosmetic ingredients
$ 5,438,262
$ 4,132,334
Pharmaceuticals
4,715,145
4,950,594
Medical lubricants
2,028,564
1,750,632
Industrial and other
—
51,594
Total Net Sales
$12,181,971
$ 10,885,154
The Company’s cosmetic ingredients are currently
marketed worldwide by five distributors, of which the
United States (“U.S.”)-based ASI purchases the largest
volume. For the years ended December 31, 2024 and
2023, approximately 16% and 21%, respectively, of
the Company’s sales were to (a) its foreign-based
distributors (which does not include ASI), which
marketed and distributed the Company’s cosmetic
ingredients to customers outside the U.S. and (b) a
few foreign customers for the Company’s medical
lubricants, which were sold directly to those customers
by the Company.
Disaggregated sales by geographic region are as
follows:
Years ended December 31,
2024
2023
United States*
$ 10,175,926
$ 8,601,205
Other countries
2,006,045
2,283,949
Net Sales
$ 12,181,971
$ 10,885,154
* Although a significant percentage of ASI’s
purchases from the Company are sold to foreign
customers, all sales to ASI are considered U.S. sales
for financial reporting purposes, since all shipments
to ASI are shipped to ASI’s warehouses in the U.S. A
certain percentage of those products are subsequently
shipped by ASI to its foreign customers. Based on
sales information provided to the Company by ASI,
79% of ASI’s sales in 2024 were to customers in foreign
countries, compared with 69% in 2023. ASI’s largest
foreign market in both 2024 and 2023 was China,
which accounted for approximately 43% of ASI’s sales
in 2024 and 29% of sales in 2023.
Cash and Cash Equivalents
For financial statement purposes, the Company
considers as cash equivalents all highly liquid
investments with an original maturity of three months
or less at the time of purchase. The Company deposits
cash and cash equivalents with financially strong,
FDIC-insured financial institutions, and it believes that
any amounts above FDIC insurance limitations are
at minimal risk. The amounts held in excess of FDIC
limits at any point in time are considered temporary
and are primarily due to the timing of maturities of
United States Treasury Bills and Certificates of Deposit.
Cash and cash equivalents held in these accounts are
currently insured by the Federal Deposit Insurance
Corporation (“FDIC”) up to a maximum of $250,000. At
December 31, 2024 and 2023, approximately $234,000
and $311,000 respectively, exceeded the FDIC limit.
The Company also invests in certain money market
mutual funds that are protected as securities by the
Securities Investor Protection Corporation (“SIPC”). At
December 31, 2024, cash held in these money market
mutual funds of approximately $563,000 exceeded the
SIPC limit. At December 31, 2023, cash held in these
money market mutual funds was below the SIPC limit.
12 United-Guardian, Inc. Annual Report 2023
Dividends
On July 10, 2024, the Company’s Board of Directors
declared a cash dividend of $0.35 per share, which
was paid on July 31, 2024, to all holders of record as of
July 23, 2024. Dividends totaling $1,607,855 were paid
and the balance of $156 is payable to stockholders
whose old Guardian Chemical shares have not yet
been exchanged to United-Guardian, Inc. shares and
are pending escheatment. On January 30, 2024, the
Company’s Board of Directors declared a cash dividend
of $0.25 per share, which was paid on February 20,
2024, to all holders of record as of February 12, 2024.
Dividends totaling $1,148,468 were paid. The balance
of $112 is payable to stockholders whose old Guardian
Chemical shares have not yet been exchanged
to United-Guardian, Inc. shares and are pending
escheatment. On January 27, 2025, the Company’s
Board of Directors declared a cash dividend of $0.35
per share, which was paid on February 18, 2025,
to all stockholders of record as of February 10, 2025.
On July 12, 2023, the Company’s Board of
Directors declared a cash dividend of $0.10 per share,
which was paid on August 2, 2023, to all stockholders
of record as of July 26, 2023. The Company did not
declare any other dividends in 2023. During 2023,
the Company declared total dividends of $459,432,
of which $459,387 was paid. The balance of $45
is payable to stockholders whose old Guardian
Chemical shares have not yet been exchanged to
United-Guardian, Inc. shares and are pending
escheatment. In June of 2023, the Company’s Board
of Directors changed the Company’s dividend
declaration practice and expects to consider a
semi-annual dividend declaration in January and
July of each year.
Marketable Securities
The Company’s marketable securities include
investments in equity mutual funds, United States
Treasury Bills (“U.S. Treasury Bills”) and Certificates
of Deposit with maturities longer than 3 months. The
Company’s marketable equity securities are reported
at fair value with the related unrealized and realized
gains and losses included in net income. U.S Treasury
Bills and Certificates of Deposit are recorded at
amortized cost. Realized gains or losses on mutual
funds are determined on a specific identification basis.
The Company evaluates its investments periodically
for possible other-than-temporary impairment by
reviewing factors such as the length of time and extent
to which fair value had been below cost basis, the
financial condition of the issuer and the Company’s
ability and intent to hold the investment for a period of
time which may be sufficient for anticipated recovery
of market value. The Company would record an
impairment charge to the extent that the cost of the
available-for-sale securities exceeds the estimated
fair value of the securities and the decline in value is
determined to be other-than-temporary. During 2024
and 2023, the Company did not record an impairment
charge regarding its investment in marketable
securities because management believes, based on
its evaluation of the circumstances, that the decline in
fair value below the cost of certain of the Company’s
marketable securities is temporary.
Inventories
Inventories are valued at the lower of cost and
net realizable value. Net realizable value is equal
to the selling price less the estimated costs of selling
and/or disposing of the product. Cost is determined
using the average cost method, which approximates
cost determined by the first-in, first-out (“FIFO”)
method. Inventory costs include material, labor and
factory overhead.
United-Guardian, Inc. Annual Report 2023 13
Property, Plant and Equipment
Property, plant and equipment are carried at cost,
less accumulated depreciation. Major replacements and
betterments are capitalized, while routine maintenance
and repairs are expensed as incurred. Assets are
depreciated under both accelerated and straight-line
methods. Depreciation charged as a result of using
accelerated methods was not materially different
than that which would result from using the straight-
line method for all periods presented. Certain factory
equipment and fixtures are constructed by the Company
using purchased materials and in-house labor. Such
assets are capitalized and depreciated on a basis
consistent with the Company’s purchased fixed assets.
Estimated useful lives are as follows:
Factory equipment and fixtures
5 - 7 years
Building
40 years
Building improvements
Lesser of useful life
or 20 years
Impairment of Long-Lived Assets
Long-lived assets are reviewed for impairment
whenever events or changes in circumstances
indicate that the carrying amount of an asset may
not be recoverable. The recoverability of assets to be
held and used is measured by a comparison of the
carrying amount of an asset to future net cash flows
expected to be generated by the asset. If such assets
are considered to be impaired, the impairment to be
recognized is measured by the amount by which the
carrying amount of the assets exceeds the fair value of
the assets. Assets to be disposed of are reported at the
lower of the carrying amount or fair value less costs to
sell. No impairments were necessary at December 31,
2024 and 2023.
Fair Value of Financial Instruments
Management of the Company believes that the
fair value of financial instruments, consisting of cash
and cash equivalents, accounts receivable, accounts
payable, and accrued expenses, approximates their
carrying value due to their short payment terms and
liquid nature.
Concentration of Credit Risk
Accounts receivable potentially expose the
Company to concentrations of credit risk. The
Company monitors the amount of credit it allows
each of its customers, using the customer’s prior
payment history to determine how much credit to
allow or whether credit should be given at all. It is
the Company’s policy to discontinue shipments to
any customer that is substantially past due on its
payments. The Company sometimes requires payment
in advance from customers whose payment record
is questionable. As a result of its monitoring of the
outstanding credit allowed for each customer, as well
as the fact that the majority of the Company’s sales are
to customers whose satisfactory credit and payment
record has been established over a long period of time,
the Company believes that its accounts receivable
credit risk has been reduced.
For the year ended December 31, 2024, four of the
Company’s pharmaceutical wholesalers and cosmetic
ingredient distributors accounted for approximately
80% of the Company’s gross sales during the year
and approximately 87% of its outstanding accounts
receivable on December 31, 2024. For the year ended
December 31, 2023, the same four pharmaceutical
wholesalers and cosmetic ingredient distributors
accounted for a total of approximately 77% of the
Company’s gross sales during the year and 89% of its
outstanding accounts receivable on December 31, 2023.
Supplier Concentration
Most of the principal raw materials used by the
Company consist of common industrial organic and
inorganic chemicals and are available in ample supply
from numerous sources. However, there are some raw
materials used by the Company that are not readily
available or require longer lead times. The Company
has three major raw material vendors that collectively
accounted for approximately 83% and 76% of the raw
material purchases by the Company in 2024 and 2023,
respectively. In addition to the Company’s raw materials
concentration, the Company utilizes one contract
manufacturer for the production of its pharmaceutical
product, Renacidin. Any disruption in this manufacturer’s
operations could have a material impact on the
Company’s revenue stream.
14 United-Guardian, Inc. Annual Report 2024
Income Taxes
Income taxes are accounted for under the asset
and liability method. Deferred tax assets and liabilities
are recognized for future tax consequences attributable
to the temporary differences between the financial
statement carrying amounts of assets and liabilities and
their respective tax bases and operating loss and tax
credit carry forwards. Deferred tax assets and liabilities
are measured using enacted tax rates expected to
apply in the years in which those temporary differences
are expected to be recovered or settled. The effect on
deferred tax assets and liabilities of a change in tax rates
is recognized in the period that includes the enactment
date. Deferred tax assets are reduced by a valuation
allowance when, in the opinion of management, it is
more likely than not that some portion or all the deferred
tax assets will not be realized.
Uncertain tax positions are accounted for utilizing
a recognition threshold and measurement attribute for
financial statement recognition and measurement of a
tax position taken or expected to be taken in a tax return.
As of December 31, 2024 and 2023, the Company did
not have any unrecognized income tax benefits. It is the
Company’s policy to recognize interest and penalties
related to taxes as interest expense as incurred. During
the years ended December 31, 2024 and 2023, the
Company did not record any tax-related interest or
penalties. The Company’s tax returns for 2021 and all
subsequent years are subject to examination by the
United States Internal Revenue Service (“IRS) and by the
State of New York.
Research and Development
Research and development expenses are
expenditures incurred in connection with in-house
research on new and existing products. It includes
payroll and payroll related expenses, outside laboratory
expenditures, lab supplies, equipment repairs and
maintenance and equipment depreciation.
Advertising Expenses
Advertising costs are expensed as incurred. The
Company did not incur any advertising costs for the
years ended December 31, 2024 or 2023.
Earnings Per Share Information
Basic earnings per share are computed by dividing
net income by the weighted average number of
common shares outstanding during the year. Diluted
earnings per share would include the dilutive effect of
outstanding stock options, if any.
New Accounting Standards
On November 4, 2024, the FASB issued ASU
2024-03 “Disaggregation of Income Statement
Expenses” (“DISE”). This guidance requires disaggregation
of certain expense captions into specified categories
in disclosures within the footnotes to the financial
statements. Subsequently issued ASU 2025-01,
clarified the effective date of this standard. This
guidance is effective for annual reporting periods
beginning after December 15, 2026, and for interim
periods, within annual reporting periods beginning after
December 15, 2027.
In December 2023, the FASB issued ASU 2023-09
“Income Taxes—Improvements to Income Tax
Disclosures”. This guidance enhances the transparency
and decision usefulness of income tax disclosures.
More specifically, the amendments relate to the
income tax rate reconciliation and income taxes paid
disclosures and require 1) consistent categories and
greater disaggregation of information in the rate
reconciliation and 2) income taxes paid disaggregated
by jurisdiction. This guidance is effective for fiscal
years beginning after December 31, 2024.
In November 2023, the FASB issued ASU 2023-07,
“Improvements to Reportable Segment Disclosures”.
This amendment requires additional disclosures by
public entities, including those with a single reportable
segment, to disclose significant segment expenses
and other segment items for each reportable segment.
The guidance applies to fiscal years beginning after
December 15, 2023, and interim periods within fiscal
years beginning after December 15, 2024. Early
adoption is permitted. On January 1, 2024, we adopted
the new standard and applied the guidance under the
new standard to include additional disclosures for
our single reportable segment. See notes A and G for
additional information.
United-Guardian, Inc. Annual Report 2024 15
NOTE B
CASH AND CASH EQUIVALENTS
Cash and cash equivalents include currency
on hand, demand deposits with banks or financial
institutions, and short-term, highly liquid investments
that are both readily convertible to known amounts
of cash and so near their maturity that they present
minimal risk of changes in value because of changes
in interest rates. The following table summarizes the
Company’s cash and cash equivalents:
Years ended December 31,
2024
2023
Demand Deposits
$ 404,801
$ 340,034
Certificates of Deposit
(original 3-month
maturity)
—
125,000
Money market funds
1,470,854
1,031,361
U.S. Treasury Bills
(original 3-month
maturity)
—
6,746,727
Total cash
and cash
equivalents
$1,875,655
$ 8,243,122
NOTE C
MARKETABLE SECURITIES
Marketable securities include investments in equity
mutual funds, which are reported at their fair values,
and U.S. Treasury Bills and Certificates of Deposit with
original maturities greater than 3 months, which are
recorded at amortized cost.
The disaggregated net gains and losses on
the marketable securities recognized in the income
statement for the years ended December 31, 2024
and 2023 are as follows:
Years ended December 31,
2024
2023
Net gains recognized
during the year
on marketable
securities
$ 26,989
$ 81,095
Less: Net losses realized
during the year
on marketable
securities sold
during the period
—
433,769
Net unrealized gains
recognized during
the reporting
year on marketable
securities still held
at the reporting date
$ 26,989
$ 514,864
The fair values of the Company’s marketable
securities are determined in accordance with US GAAP,
with fair value being defined as the amount that would
be received to sell an asset or paid to transfer a liability
in an orderly transaction between market participants
at the measurement date. As such, fair value is a
market-based measurement that should be determined
based on assumptions that market participants
would use in pricing an asset or liability. As a basis for
considering such assumptions, the Company utilizes
the three-tier value hierarchy, as prescribed by US
GAAP, which prioritizes the inputs used in measuring
fair value as follows:
• Level 1—inputs to the valuation methodology are
quoted prices (unadjusted) for identical assets or
liabilities in active markets.
• Level 2—inputs to the valuation methodology
include quoted prices for similar assets and
liabilities in active markets, and inputs that are
observable for the asset or liability, either directly
or indirectly, for substantially the full term of the
financial instrument.
• Level 3—inputs to the valuation methodology
are unobservable and significant to the fair value
measurement.
16 United-Guardian, Inc. Annual Report 2024
The Company’s marketable equity securities, which are considered available-for-sale securities, are
re-measured to fair value on a recurring basis and are valued using Level 1 inputs using quoted prices (unadjusted)
for identical assets in active markets. The following tables summarize the Company’s investments:
December 31, 2024
Unrealized
Cost
Fair Value
Gain
Equity Securities:
Equity and other mutual funds
$ 634,705
$ 663,682
$ 28,977
Other short-term investments:
Fixed income Certificates of Deposit
(original maturities > 3 months)
570,000
570,000
—
U.S. Treasury Bills (original maturities > 3 months)
6,288,943
6,288,943
—
Total other short-term investments
$ 6,858,943
$6,858,943
$
—
Total marketable securities
$ 7,493,648
$7,522,625
$ 28,977
December 31, 2023
Unrealized
Cost
Fair Value
Gain
Equity Securities:
Equity and other mutual funds
$ 574,330
$ 576,318
$
1,988
Other short-term investments:
Fixed income Certificates of Deposit
(original maturities > 3 months)
275,000
275,000
—
Total marketable securities
$ 849,330
$ 851,318
$
1,988
Investment income is recognized when earned and consists principally of dividend income from equity mutual
funds and interest income on United States Treasury Bills, Certificates of Deposit and money market funds. Realized
gains and losses on sales of investments are determined on a specific identification basis.
Proceeds from the sale and redemption of marketable securities amounted to $1,815,000 for the year ended
December 31, 2024 and there were no realized gains or losses. Proceeds from the sale and redemption of marketable
securities for the year ended December 31, 2023 amounted to $5,505,145, which included realized losses of $433,769.
NOTE D
INVENTORIES
Inventories consist of the following:
December 31,
2024
2023
Raw materials
$ 448,113
$ 476,501
Work in process
58,699
92,089
Finished products
945,183
654,916
Total Inventories
$ 1,451,995
$ 1,223,506
Inventories are valued at the lower of cost and net realizable value. Net realizable value is equal to the selling
price less the estimated costs of selling and/or disposing of the product. Cost is determined using the average
cost method, which approximates cost determined by the first-in, first-out method. Finished product inventories on
December 31, 2024 and December 31, 2023 are net of a reserve of $32,792 and $47,000, respectively.
United-Guardian, Inc. Annual Report 2023 17
NOTE E
INCOME TAXES
The provision for income taxes consists of the following:
Years ended December 31,
Current
2024
2023
Federal
$ 981,244
$ 609,006
State
805
788
Total current provision for income taxes
982,049
609,794
Deferred
Federal
(124,467)
59,614
Total deferred (benefit) expense from income taxes
(124,467)
59,614
Total provision for income taxes
$ 857,582
$ 669,408
The following is a reconciliation of the Company’s effective income tax rate to the Federal statutory rate:
Years ended December 31,
2024
2023
($)
Tax rate
($)
Tax rate
Income taxes at statutory federal
income tax rate
$862,776
21.0%
$ 682,664
21.0%
State taxes, net of federal benefit
636
—
623
—
Research & development credits
(9,000)
(0.1)
(14,000)
(0.4)
Other, net
3,170
—
121
—
Provision for income taxes
$857,582
20.9%
$ 669,408
20.6%
The tax effects of temporary differences which comprise the deferred tax assets and liabilities are as follows:
December 31,
2024
2023
Deferred tax assets
Allowance for credit losses
$
3,012
$
3,501
Inventories
6,886
9,870
Accounts payable
89,251
28,235
R&D expenses
206,069
159,838
Accrued expenses
306,381
285,200
Total deferred tax assets
$ 611,599
$ 486,644
Deferred tax liabilities
Accounts receivable
(302,987)
(332,537)
Prepaid expenses
(58,171)
(46,484)
Depreciation on property, plant and equipment
(68,959)
(56,275)
Unrealized gain on marketable securities
(6,085)
(418)
Total deferred tax liabilities
(436,202)
(435,714)
Net deferred tax asset
$ 175,397
$ 50,930
18 United-Guardian, Inc. Annual Report 2023
NOTE F
BENEFIT PLANS
Defined Contribution Plan
The Company sponsors a 401(k) defined
contribution plan (“DC Plan”) that provides for a dollar-
for-dollar employer matching contribution of the
first 4% of each employee’s pay. Employees become
fully vested in employer matching contributions
immediately. Company 401(k) matching contributions
were approximately $84,000 and $83,000 for the years
ended December 31, 2024 and 2023, respectively.
The Company also makes discretionary
contributions to each employee’s account based
on a “pay-to-pay” safe-harbor formula that qualifies
the 401(k) Plan under current IRS regulations. For
the years ended December 31, 2024 and 2023,
the Company’s Board of Directors authorized
discretionary contributions in the amount of $115,000
and $109,000, respectively, to be allocated among
all eligible employees. Employees become vested
in the discretionary contributions as follows: 20%
after two years of employment, and 20% for each
year of employment thereafter until the employee
becomes fully vested after six years of employment.
The discretionary contribution for 2024 was paid in
February 2025 and is included in accrued expenses.
NOTE G
GEOGRAPHIC and OTHER INFORMATION
Through its Guardian Laboratories division, the
Company conducts research, product development,
manufacturing, and marketing of cosmetic ingredients,
pharmaceuticals, medical lubricants and sexual
wellness ingredients. Prior to July 1, 2023, the
Company manufactured and reported sales of a line of
specialty industrial products, however this produce line
was discontinued after the second quarter of 2023 due
to low sales volume with no growth. All the products
that the Company markets, with the exception of
Renacidin, are produced at its facility in Hauppauge,
New York. Renacidin, a urological product, is
manufactured for the Company by an outside contract
manufacturer. The Company’s R&D department not
only develops new products but also modifies and
refines existing products, with the goal of expanding
the potential markets for the Company’s products.
Many of the cosmetic ingredients manufactured by
the Company, particularly its Lubrajel line of water-
based moisturizing and lubricating gels, are currently
used by many of the major multinational personal care
products companies.
The Company operates in one business segment.
The Company’s products are separated into five
distinct product categories: cosmetic ingredients,
pharmaceuticals, medical lubricants, sexual wellness
ingredients and industrial products. The Company
discontinued its industrial line of products after
the second quarter of 2023 due to a low volume
of sales and no growth. Each product category is
marketed differently.
The cosmetic ingredients are marketed through
a global network of distributors. These distributors
purchase products outright from the Company and
provide the main marketing and sales functions for
these products on behalf of the Company. They in
turn receive their compensation for those efforts
by re-selling those products at a markup to their
customers. This enables the Company to aggressively
have its products marketed without the high cost of
maintaining its own in-house marketing and sales
staff. In 2024 we hired a marketing director to work
alongside our distributors and provide marketing
materials, training and aid in customer visits. We
believe this strategy will allow us to better serve our
mutual customers and build stronger relationships
with our distributors. The Company currently has one
written distribution agreement with the companies
that market its cosmetic ingredients. The marketing
contract with ASI terminated on December 31, 2023,
and the Company is currently in negotiations with ASI
to establish a new marketing agreement. The Company
is hopeful that it will have a new marketing agreement
in place with ASI by mid-2025. The Company’s
relationship with ASI continues to be strong, and during
this period of renegotiation the Company continues
to fill ASI’s orders on a timely basis. All sales of the
Company’s cosmetic ingredients are final other than
product later determined to be defective, and the
Company does not make any sales on consignment.
No prior regulatory approval is needed by
the Company to sell any products other than its
pharmaceutical products. The end users of its products
may or may not need regulatory approvals, depending
on the intended claims and uses of those products.
United-Guardian, Inc. Annual Report 2024 19
The pharmaceutical products include a urological
product and a topical biocide that are sold to end users
primarily through distribution agreements with major
drug wholesalers. For these products, the Company
does the marketing, and the drug wholesalers supply
the product to the end users, such as hospitals and
pharmacies. The Company’s marketing effort for
Renacidin, its most important drug product, currently
includes a Renacidin website which provides product
information to patients and healthcare providers as
well as a focus group study that was conducted in
2024. There is currently no active marketing effort
for Clorpactin. Both of these products were originally
developed in the 1950s. Clorpactin pre-dated the need
for a formal New Drug Application (“NDA”), and the
current sterile liquid form of Renacidin is marketed
under an NDA that was approved by the FDA in 1990.
The medical lubricants are not pharmaceutical
products. They consist primarily of water-based
lubricating gels, which are marketed by the Company
directly to manufacturers that incorporate them
into urologic catheters and other medical devices
and products that they sell. These products are
distinguished from pharmaceutical products in that,
unlike the pharmaceutical products, the Company
is not required to obtain regulatory approval prior
to marketing them. Regulatory approvals are the
responsibility of the companies that market the
finished products in which the Company’s products are
used, which are typically classified as medical devices.
However, the Company is responsible for manufacturing
these products in accordance with current Good
Manufacturing Practices, and its manufacturing facility
is subject to regular FDA oversight.
The industrial products were marketed by the
Company directly to manufacturers, and generally
did not require that the Company obtain regulatory
approval. However, the manufacturers of the finished
products may have to obtain such regulatory approvals
before marketing these products. The Company
discontinued this product line on July 1, 2023.
The sexual wellness ingredients are marketed
by Brenntag Specialties, a global market leader in
chemicals and ingredient distribution. The Company
entered into a marketing and distribution agreement
with Brenntag in October of 2023 in the United States,
Canada, Mexico, Central America and South America.
The following tables present the significant
concentrations of the Company’s sales. Although a
significant percentage of Customer A’s purchases
from the Company are sold to foreign customers, in
table “(b)” below all sales to Customer A are included
in the “United States” sales numbers because all
shipments to Customer A are delivered to Customer A’s
warehouses in the U.S.
In addition, there are four customers for the
Company’s medical lubricants that take delivery of their
shipments in the U.S. but potentially ship some of that
product to manufacturing facilities outside the U.S.
Since the Company makes those shipments to U.S.
locations, sales to those customers are also included
in the “United States” sales number in the table below.
(a) Net Sales
Years ended December 31,
2024
2023
Cosmetic Ingredients
$ 5,817,172
$ 4,283,071
Pharmaceuticals
5,602,259
5,894,220
Medical Lubricants
2,028,564
1,750,632
Industrial and other
—
51,594
Gross Sales
13,447,995
11,979,517
Less: Discounts
and allowances
(1,266,024)
(1,094,363)
Net Sales
$ 12,181,971
$ 10,885,154
(b) Geographic Information
Years ended December 31,
2024
2023
United States
$ 10,175,926
$ 8,601,205
Other countries
2,006,045
2,283,949
Net Sales
$ 12,181,971
$ 10,885,154
(c) Gross Sales to Major Customers
Years ended December 31,
2024
2023
Customer A
$ 5,387,048
$ 3,464,861
Customer B
2,239,705
2,502,846
Customer C
1,831,551
1,726,753
Customer D
1,331,544
1,490,158
All other customers
2,658,147
2,794,899
Total Gross Sales
$ 13,447,995
$ 11,979,517
20 United-Guardian, Inc. Annual Report 2024
NOTE H
ACCRUED EXPENSES
Accrued expenses at December 31, 2024 and 2023
consist of:
2024
2023
Bonuses
$ 290,000
$ 187,002
Distribution fees
441,397
407,133
Payroll and related
expenses
73,915
96,157
Company 401(k)
contribution
115,000
109,000
Annual report expenses
83,238
81,725
Audit fee
73,364
71,000
Reserve for outdated
material returns
276,732
247,847
Sales rebates
90,904
132,250
Other
23,383
30,930
Total accrued
expenses
$ 1,467,933
$ 1,363,044
NOTE I
SUPPLEMENTAL DISCLOSURES OF CASH FLOW
INFORMATION AND NON-CASH INVESTING AND
FINANCING ACTIVITIES
As of December 31, 2024, the Company had
a number of unconverted Guardian Chemical
shares that would convert to approximately 447
shares of United-Guardian, Inc. common stock if all
of the remaining holders of those Guardian shares
converted their Guardian stock to United-Guardian
stock. The Company’s transfer agent continues to try
to locate the holders of those shares in anticipation
of escheating them to the appropriate state
jurisdictions. The Company is currently accruing
dividends on the 447 shares that have not yet been
exchanged or designated for escheatment as of
December 31, 2024, and the Company will continue
to do so as dividends are declared.
NOTE J
RELATED PARTY TRANSACTIONS
During the years ended December 31, 2024 and
2023, the Company made payments of $20,000 and
$100,000, respectively, to Ken Globus, the Company’s
former President, for consulting services subsequent
to his departure from the Company. The Company’s
consulting agreement with Ken Globus expired
on May 31, 2024. Ken Globus is a director of the
Company and currently serves as Chairman of the
Board of Directors.
During the years ended December 31, 2024 and
2023, the Company paid PKF O’Connor Davies $23,250
and $20,000, respectively, for accounting and tax
services. Lawrence Maietta, a partner at PKF O’Connor
Davies, is a director of the Company.
NOTE K
SUBSEQUENT EVENTS
On January 27, 2025, the Company’s Board
of Directors declared a cash dividend of $0.35 per
share, which was paid on February 18, 2025 to all
stockholders of record as of February 10, 2025.
United-Guardian, Inc. Annual Report 2024 21
EXECUTIVE LEVEL OVERVIEW
We specialize in manufacturing cosmetic
ingredients, pharmaceuticals, medical lubricants, and
sexual wellness ingredients through our Guardian
Laboratories division. With a long-standing reputation
for delivering high-quality specialty products, we are
committed to serving diverse markets with innovative
solutions.
As part of our strategic focus, we discontinued our
specialty industrial products line in mid-2023 due to low
sales and limited growth potential. This shift allows us
to concentrate on higher-value product categories with
greater market opportunities.
In October 2023, we took a significant step toward
expanding our presence in the sexual wellness market
by partnering with Brenntag Specialties, a global leader
in chemicals and ingredients distribution. Under this
agreement, Brenntag will distribute our new Natrajel line
of sexual wellness ingredients across North and South
America. While we reported no sales of this product line
in 2024, we anticipate beginning manufacturing and
revenue generation in 2025.
With a refined product portfolio and strategic
partnerships, we are well-positioned for future growth,
leveraging our expertise in specialty ingredients to
capitalize on emerging market opportunities.
IMPACT OF GLOBAL SUPPLY CHAIN INSTABILITY,
INFLATION AND TARIFFS
The continued supply chain instability, primarily
caused by military tensions in the Middle East, continues
to impact vessels’ access to the Red Sea and Suez
Canal. Shipping experts say this crisis may last into the
first half of 2025. We continue to work with our suppliers
regarding lead times and continue to closely monitor
this situation. Although we have not yet experienced
any delays in receiving raw materials or an increase in
shipping costs, we are aware that the situation is fluid
and could impact us at any time. If that occurs, we may
experience longer lead times and increased shipping
costs for some of our raw materials, which may impact
our future gross margins. As a result of this global
supply chain instability, there continues to be uncertainty
regarding the potential impact on our operations
or financial results and we are unable to provide an
accurate estimate or projection as to what the future
impact will be.
The Trump administration has communicated its
intention to impose tariffs on many products imported
from China, Canada and Mexico. Some of those tariffs
went into effect on March 4, 2025. Since that time the
Trump administration has increased some of those
tariffs and postponed others. It has threatened to
levy tariffs on additional countries, including those of
the European Union. Many of the countries on which
those tariffs have been levied have imposed their own
retaliatory tariffs or threated to impose tariffs on goods
they import from the U.S. The tariff situation remains
fluid and is subject to modification at any time. At this
time, it is difficult to determine the impact of these
tariffs on our business. We will continue to monitor this
situation closely.
While we obtain most of our raw materials and
lab supplies from domestic sources, we have three
suppliers that obtain their raw materials from China.
These materials are not purchased by us in large
quantities, and we have adequate stock on hand to
cover the next six months. In addition, we have one
direct raw material supplier in China; however, the raw
materials we purchase from this supplier are not in
large quantities and the effect of this tariff would not
materially impact the pricing of our products.
Many of our products are used in the formulation
of finished products that are manufactured in China
and then imported back into the United States (“U.S.”)
for sale. There is the possibility that the tariffs levied on
these finished products could result in an increase in
their price, which could potentially impact demand for
these products in the U.S.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
22 United-Guardian, Inc. Annual Report 2024
Due to the continued uncertainty of this, any other
tariffs that may be imposed, there continues to be
uncertainty regarding the future impact of any additional
tariffs on our operations or financial results.
CRITICAL ACCOUNTING POLICIES
Our financial statements have been prepared
in accordance with Generally Accepted Accounting
Principles in the United States of America (“US
GAAP”). Preparation of financial statements requires
us to make estimates and assumptions affecting the
reported amounts of assets, liabilities, revenues, and
expenses and the disclosure of contingent assets and
liabilities. We use our historical experience and other
relevant factors when developing our estimates and
assumptions, which are continually evaluated. Note A,
Nature of Business and Summary of Significant
Accounting Policies, of the Notes to Financial
Statements, included in Item 8, Financial Statements
and Supplementary Data, of this Annual Report, includes
a discussion of our significant accounting policies. The
following accounting policies are those that we consider
critical to an understanding of the financial statements
because their application places the most significant
demands on management’s judgment. Our financial
results might have been different if other assumptions
had been used or other conditions had prevailed.
Marketable Securities
Our marketable securities include investments
in equity mutual funds, Certificates of Deposit and
U.S. Treasury Bills with original maturities of greater
than three months. Our marketable equity securities
are reported at fair value with the related unrealized
and realized gains and losses included in net income.
Certificates of Deposit and U.S. Treasury Bills with
original maturities of more than 3 months are recorded
at amortized cost. Realized gains or losses on mutual
funds are determined on a specific identification basis.
We evaluate our investments periodically for possible
other-than-temporary impairment by reviewing factors
such as the length of time and extent to which fair
value had been below cost basis, the financial condition
of the issuer, and our ability and intent to hold the
investment for a period of time which may be sufficient
for anticipated recovery of market value. We record
an impairment charge to the extent that the cost of
the available-for-sale securities exceeds the estimated
fair value of the securities and the decline in value is
determined to be other-than-temporary. During 2024 and
2023, we did not record an impairment charge regarding
our investment in marketable securities because
management believes, based on an evaluation of the
circumstances, that any decline in fair value below the
cost of certain of our marketable securities is temporary.
Revenue Recognition
We record revenue in accordance with ASC Topic
606 “Revenue from Contracts with Customers.” Under
this guidance, revenue is recognized when a customer
obtains control of promised goods or services, in an
amount that reflects the consideration expected to be
received in exchange for those goods or services. Our
principal source of revenue is product sales.
Our sales, as reported, are subject to a variety
of deductions, some of which are estimated. These
deductions are recorded in the same period in which
the revenue is recognized. Such deductions, primarily
related to the sale of our pharmaceutical products,
include chargebacks from the United States Department
of Veterans Affairs (“VA”), rebates in connection with our
current participation in Medicare programs, distribution
fees, discounts, and outdated product returns.
These deductions represent estimates of the related
obligations and, as such, knowledge and judgment are
required when estimating the impact of these revenue
deductions on sales for a reporting period.
During 2024 and 2023, we participated in various
government drug rebate programs related to the sale
of Renacidin, our most important pharmaceutical
product. These programs include the Veterans Affairs
Federal Supply Schedule (“FSS”), and the Medicare
Part D Coverage Gap Discount Program (“CGDP”). These
programs require us to sell our products at a discounted
price, typically in the form of a rebate. Our sales, as
reported, are net of these rebates, some of which are
estimated and are recorded in the same period that the
revenue is recognized.
On January 1, 2025, the Centers for Medicare &
Medicaid Services (“CMS”) implemented a new
Medicare Part D Manufacturer Discount Program
(“Discount Program”), which replaced the prior CGDP.
The new Discount Program eliminates the coverage
United-Guardian, Inc. Annual Report 2024 23
gap benefit phase, introduces pharmaceutical
manufacturer discounts in the initial and catastrophic
coverage phases, and lowers the cap on enrollee out-
of-pocket costs. Under the new Discount Program,
additional rebates are expected to be owed by
pharmaceutical manufacturers due to the restructuring
of the benefit periods and removal of the cap that was
in place that limited the drug manufacturer’s liability.
The overall financial impact of this new program will
vary depending on the products being reimbursed but
it is expected to increase Medicare Part D rebates for
drug manufacturers.
On January 31, 2024, we were notified by CMS
that we qualified as a “specified small manufacturer”
and would be entitled to a multi-year phase-in period
during which we would pay a lower percentage discount
on drugs dispensed to beneficiaries. Based on our
“specified small manufacturer” designation, it appears,
based on our current level of sales through the Medicare
Part D Program, we would have reduced rebate
liabilities in years 2025 and 2026, with rebates gradually
increasing each year after, until they reach their full
phase-in by 2031. By the end of the phase in period in
2031, these rebate liabilities are expected to significantly
exceed the liabilities we have recorded under the CGDP
in previous years.
As long as a valid purchase order has been
received and future collection of the sale amount
is reasonably assured, we recognize revenue from
sales of our products when those products are
shipped, which is when our performance obligation
is satisfied. Our cosmetic products are shipped EXW
from our facility in Hauppauge, NY, and the risk of
loss and responsibility for the shipment passes to
the customer upon shipment. Sales of our medical
lubricant products are deemed final upon shipment,
and we have no obligation to repurchase or allow
the return of these goods unless they are defective.
Sales of our pharmaceutical products are final upon
shipment unless (a) they are found to be defective; (b)
the product is damaged in shipping; (c) the product is
too close to its expiration date for the customer to sell;
or (d) the product is expired but is not more than one
year after its expiration date. These return policies are
in conformance with standard pharmaceutical industry
practice. We estimate an allowance for outdated
material returns based on previous years’ historical
returns of our pharmaceutical products.
We do not make sales on consignment, and the
collection of the proceeds of the sale of any of our
products is not contingent upon the customer being
able to sell the goods to a third party.
Any allowances for returns are taken as a reduction
of sales within the same period the revenue is
recognized. Such allowances are determined based on
historical experience under ASC Topic 606-10-32-8. We
have not experienced significant fluctuations between
estimated allowances and actual activity.
We have distribution agreements with certain
distributors of our pharmaceutical products that entitle
those distributors to distribution and services-related
fees. We record distribution fees, and estimates of
distribution fees, as offsets to revenue.
Accounting for Financial Instruments—Credit Losses
We recognize an allowance for our trade receivables
to present the net amount expected to be collected
as of the balance sheet date. This allowance is based
on the credit losses expected to arise over the life
of the asset and are based on Current Expected Credit
Losses (CECL).
We perform ongoing credit evaluations of our
customers and adjust credit limits, as determined by a
review of current credit information. We continuously
monitor collection and payments from customers and
maintain an allowance for credit losses based upon
historical experience, anticipation of uncollectible
accounts receivable and any specific customer
collection issues that have been identified. While our
credit losses have historically been low and within
expectations, we may not experience the same credit
loss rates that have historically been attained in the
future. The receivables are highly concentrated in a
relatively small number of customers. Therefore, a
significant change in the liquidity, financial position,
or willingness to pay timely, or at all, of any one of our
significant customers would have a significant impact
on our results of operations and cash flows. When
determining the reserve for credit losses, we take into
consideration current and future economic conditions
and the impact that these changing dynamics may
have on potential future losses.
24 United-Guardian, Inc. Annual Report 2024
The timing between recognition of revenue
for product sales and the receipt of payment is
not significant. Our standard credit terms, which
vary depending on the customer, range between
30 and 60 days. We provide an allowance for credit
losses related to our accounts receivable for which
collection is doubtful in accordance with ASU 2016-13.
In accordance with FASB ASC Topic 326, “Financial
Instruments—Credit Losses (Topic 326): Measurement
of Credit Losses on Financial Instruments”, (“ASC 326”),
we present financial assets at the net amount expected
to be collected, requiring immediate recognition of
estimated credit losses expected to occur over the
asset’s remaining life.
As of December 31, 2024 and December 31, 2023,
the allowance for credit losses on accounts receivable
was $14,342 and $16,672, respectively. Prompt-pay
discounts are offered to some customers; however, due
to the uncertainty of the customers taking the discounts,
the discounts are recorded when they are taken.
Inventory Valuation Allowance
In conjunction with our ongoing analysis of
inventory valuation, management constantly monitors
projected demand on a product-by-product basis.
Based on these projections, management evaluates
the levels of write-downs required for inventory
on hand and inventory on order from contract
manufacturers. Although we believe that we have been
reasonably successful in identifying write-downs in
a timely manner, sudden changes in buying patterns
from customers, either due to a shift in product
interest and/or a complete pullback from their
expected order levels, may result in the recognition of
larger-than-anticipated write-downs. We have performed
an evaluation of our inventory on hand as of
December 31, 2024 and December 31, 2023, and
believe the reserves are adequate to cover any slow-
moving or obsolete inventory.
RESULTS OF OPERATIONS
Sales
Sales increased by approximately 12%, from
$10,885,154 in 2023 to $12,181,971 in 2024. The increase
in sales was primarily due to an increase in sales of our
cosmetic ingredient products, specifically an increase
of 51% in sales to our largest distributor, ASI, in 2024
compared with 2023. In addition, sales of our medical
lubricants increased by 16%, primarily due to increased
orders placed by our largest customer in China.
Cosmetic Ingredients
Sales of our cosmetic ingredients increased
by approximately 32%, from $4,132,334 in 2023
to $5,438,262 in 2024. The increase was primarily
due to an increase in sales to ASI. Based on
information provided to the Company by ASI, the
reasons for the increase during 2024 was due to
increased demand for our products in China due
to regaining market share at certain key accounts.
This increase was offset by sales to our other
four distributors, whose sales decreased by a net
of approximately 49%, while sales from two of
our small direct cosmetic ingredient customers
increased by approximately 19%. This decrease
was primarily due to reformulations.
We continue to experience global competition
from Asian and European companies that
manufacture and sell products that are competitive
with our products. These competitive products
are usually sold at a lower price than our products;
however, they may not compare favorably to the
level of performance and quality of our products.
We work closely with our network of distributors
to price our products as competitively as possible
and, when appropriate, to offer additional volume
discounts and more aggressive pricing to maintain
and increase sales and expand our customer
base. We expect that this competitive environment
will continue in 2025 and we plan to enhance
our competitive position by strengthening our
core capabilities and investing in new products,
especially in the area of naturally derived products.
We will continue to provide high-quality products,
technical expertise, and the reliability our
customers have come to expect from us.
United-Guardian, Inc. Annual Report 2024 25
Pharmaceuticals
Because there are fees, rebates, and
allowances associated with sales of our two
pharmaceutical products, Renacidin and
Clorpactin®, discussion of our pharmaceutical
sales includes references to both gross sales
(before fees, rebates and allowances) and net
sales (after fees, rebates and allowances). Gross
sales of our two pharmaceutical products,
Renacidin and Clorpactin, together decreased
by approximately 5%, from $5,894,220 in 2023
to $5,602,259 in 2024. Gross sales of Renacidin
decreased by approximately 4%, from $5,127,069
in 2023 to $4,897,331 in 2024, and gross sales of
Clorpactin decreased by 8% from $767,151 in 2023
to $704,928 in 2024.
The primary reason for the decrease
in Renacidin sales was due to our contract
manufacturer temporarily ceasing manufacturing
during the latter part of 2023 and the beginning
of 2024. During this time, we were unable to fill
complete orders of Renacidin and were allocating
product to all of our pharmaceutical distributors.
We resumed filling orders in full towards the end of
March 2024.
Net sales of our pharmaceutical products
decreased by approximately 5% in 2024 compared
with the same period in 2023. The decrease in
net sales was due to a decrease in gross sales
combined with a commensurate decrease in
certain pharmaceutical-related rebates and
allowances. The decrease in pharmaceutical-
related rebates and allowances in 2024 was
primarily due to a decrease in VA Chargebacks
and Medicare rebates.
Medical Lubricants
Sales of our medical lubricants increased by
approximately 16% in 2024, from $1,750,632 in 2023
to $2,028,564 in 2024. The increase in sales was
driven by increased demand from one of our larger
contract manufacturer customers located in China.
Sexual Wellness Ingredients
There were no sales of our sexual wellness
ingredients in 2024, since we only began our
marketing efforts for those products in mid-2023.
Customers need to qualify new ingredients and
perform product development testing prior to
launching a new product. It is not unusual for this
process to take a year or more and inherently it
will require additional time for new ingredients to
generate sales. Our distributor for these products
has informed us of the possibility of orders being
placed in mid-2025.
Industrial Products
There were no sales of our industrial products
during 2024 due to this product line being
discontinued after the second quarter of 2023.
Gross Profit on Sales
Gross profit on sales was 53% in 2024 compared
with 50% in 2023. The increase in gross profit was
primarily due to two factors. The first was an increase
in sales of our cosmetic ingredients of 32% in 2024
compared to 2023, which carry a higher profit margin
than our pharmaceutical products, combined with the
fact that in 2024, the percentage of cosmetic product
sales as a percentage of total sales increased to
approximately 45%, compared with 38% in 2023. The
second factor was lower per unit overhead costs due
to increased production, which was caused by higher
demand for some of our products.
Operating Expenses
Operating expenses increased by approximately
13%, from $2,078,564 in 2023 to $2,356,819 in 2024.
The increase was mainly attributable to the following:
1) increases in sales and marketing expenses incurred in
connection with the hiring of our new Marketing Director;
2) an increase in payroll and payroll-related expenses;
and 3) an increase in fees paid to our Board of Directors.
In connection with our growth initiatives, we anticipate
that operating expenses will increase modestly in 2025.
26 United-Guardian, Inc. Annual Report 2024
Research and Development Expenses
Research and development expenses decreased by
approximately 2%, from $463,992 in 2023 to $456,779
in 2024. In connection with the Company’s growth
initiatives, we expect our research and development
expenses to increase modestly during 2025.
Investment Income
Investment income increased by approximately
42%, from $306,651 in 2023 to $434,679 in 2024.
The increase was primarily due to an increase in
interest income from investments in longer term U.S.
Treasury Bills and Certificates of Deposit in 2024
compared to 2023. In addition, during 2024 we held
more funds in money market accounts which yielded
higher interest income compared to 2023. During the
second half of 2023, we repositioned our marketable
securities portfolio, liquidating most of our equity
and fixed income mutual funds. The proceeds from
these sales were used to purchase U.S. Treasury Bills
and Certificates of Deposit to take advantage of the
increase in interest rates.
Net Gain on Marketable Securities
For the year ended December 31, 2024, we recorded
net gains on our marketable securities portfolio of
$26,989 compared with net gains of $81,095 in 2023.
We repositioned our marketable securities portfolio
in the second half of 2023 to take advantage of the
increase in interest rates. Management, as well as
the Investment Committee of the Board of Directors,
continue to closely monitor our investment portfolio
and will make any adjustments they believe may be
necessary or appropriate in order to minimize the future
impact on our financial performance due to volatility of
the global financial markets.
Provision for Income Taxes
The provision for income taxes increased from
$669,408 in 2023 to $857,582 in 2024. This increase
was due to an increase in income before taxes. Our
effective income tax rate was 20.9% in 2024 and 20.6%
in 2023.
Liquidity and Capital Resources
Working capital increased from $10,718,457 at
December 31, 2023 to $10,751,082 at December 31,
2024. The increase in working capital was mainly due
to an increase in cash and cash equivalents, marketable
securities and inventories. The current ratio decreased
from 8.0 to 1 at December 31, 2023 to 6.6 to 1 at
December 31, 2024. The decrease in the current ratio
was due mainly due to an increase in accounts payable.
Accounts receivable (net of allowance for
credit losses) as of December 31, 2024 decreased
from $1,566,839 in 2023 to $1,428,455 in 2024.
The decrease in accounts receivable was due to a
decrease in sales during the fourth quarter of 2024.
The receivables turnover, or “Days Sales Outstanding,”
for 2024, was 45 days, compared with 50 days in
2023. The allowance for credit losses on accounts
receivable decreased from $16,672 in 2023 to $14,342
in 2024, and we believe that the net balance of our
accounts receivable as of December 31, 2024 was, and
continues to be, fully collectible.
We generated cash from operations of $3,466,251
in 2024 compared with $3,144,480 in 2023. The
increase in 2024 was primarily due to an increase in
net income, offset by increases in inventories and
deferred income taxes.
Net cash used in investing activities was $7,077,395
for the year ended December 31, 2024, compared with
net cash provided by investing activities of $4,277,577
for the year ended December 31, 2023. The shift
was primarily due to an increase in the purchase of
longer-term investments in 2024 that are classified
as marketable securities. During 2023, most of our
marketable securities consisted of U.S. Treasury Bills
and Certificates of Deposit that had maturities of less
than three months and were included in cash and cash
equivalents. During 2024, we changed our investment
strategy to longer term fixed income investments due to
the anticipated decrease in interest rates.
Net cash used in financing activities was
$2,756,323 and $459,387 for the years ended
December 31, 2024 and 2023, respectively. The
increase was due to the payment of higher dividends
in 2024 compared with 2023. During 2024, we paid
dividends of $0.60 per share compared with $0.10 per
share in 2023.
We believe that our working capital is sufficient to
support our operating requirements for the next fiscal
year. Our long-term liquidity position will be dependent
upon our ability to generate sufficient cash flow from
United-Guardian, Inc. Annual Report 2024 27
profitable operations, and we expect to continue to
use our cash to make dividend payments, purchase
marketable securities, and to take advantage of growth
opportunities that may arise that are in the best
interest of the business and our stockholders.
In connection with an upgrade to our building
sprinkler system, costs of approximately $181,000
have been incurred as of December 31, 2024. The
project is substantially complete and is expected to be
fully complete by the end of the first quarter of 2025,
with additional planned expenditures of $14,000.
During the fourth quarter of 2024, the Company
replaced the roof on a portion of its facility in Hauppauge,
New York at a cost of approximately $237,000.
We have no off-balance-sheet transactions that
have, or are reasonably likely to have, a current
or future effect on our financial condition, changes
in financial condition, revenues or expenses, results
of operations, liquidity, capital expenditures or
capital resources.
New Accounting Pronouncements
See Note “A” to the financial statements regarding
new accounting pronouncements, which note is
incorporated herein by reference.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER
MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Information
Our Common Stock is currently traded on the NASDAQ Global Market, under the symbol “UG”.
Holders of Record
As of March 3, 2025, there were 342 holders of record of Common Stock.
Dividend Policy
On July 10, 2024, our Board of Directors declared a cash dividend of $0.35 per share, which was paid on
July 31, 2024, to all holders of record as of July 23, 2024. On January 30, 2024, our Board of Directors declared a
cash dividend of $0.25 per share, which was paid on February 20, 2024, to all holders of record as of February 12,
2024. On January 27, 2025, our Board of Directors declared a cash dividend of $0.35 per share, which was paid
on February 18, 2025, to all holders of record as of February 10, 2025.
On July 12, 2023, our Board of Directors declared a cash dividend of $0.10 per share, which was paid on
August 2, 2023, to all stockholders of record as of July 26, 2023. We did not declare any other dividends in 2023.
In June of 2023, our Board of Directors changed the dividend declaration practice to a semi-annual dividend
declaration in January and July of each year.
28 United-Guardian, Inc. Annual Report 2024
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Audit Committee and Stockholders of United-Guardian, Inc.:
Opinion on the Financial Statements
We have audited the accompanying balance sheet of United-Guardian, Inc. (the “Company”) as of December 31,
2024 and 2023, and the related statements of income, stockholders’ equity, and cash flows for the year ended, and
the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements
present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023,
and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles
generally accepted in the United States of America.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an
opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with
the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with
respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations
of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial statements are free of material
misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to
perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an
understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the
effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audit included performing procedures to assess the risks of material misstatement of the financial statements,
whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included
examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit
also included evaluating the accounting principles used and significant estimates made by management, as well
as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable
basis for our opinion.
Critical Audit Matters
Critical audit matters are matters arising from the current period audit of the financial statements that were
communicated or required to be communicated to the audit committee and that (1) relate to accounts or
disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or
complex judgments. We determined that there were no critical audit matters.
GRASSI & CO., CPAs, P.C.
We have served as the Company’s auditors since 2023.
Jericho, New York
March 19, 2025
REGISTRAR AND TRANSFER AGENT
Continental Stock Transfer & Trust Company
1 State Street, 30th Floor
New York, NY 10004
LEGAL COUNSEL
Ruskin Moscou Faltischek, P.C.
Uniondale, NY
AUDITORS
Grassi & Co., CPAs, P.C.
Jericho, NY
MAIN OFFICE AND PLANT
230 Marcus Blvd.
Hauppauge, NY 11788
MAILING ADDRESS
P.O. Box 18050
Hauppauge, NY 11788
Tel: (631) 273-0900
Fax: (631) 273-0858
Website: www.u-g.com
NOTE: Upon written request, a copy of the Company’s
most recent Annual Report on Form 10-K will be
furnished without charge. A fee will be charged for
copies of any exhibits to such report. Contact: Corporate
Secretary, United-Guardian, Inc., P.O. Box 18050, Hauppauge,
NY 11788.
Excellence Through Innovation®
230 Marcus Boulevard
P.O. Box 18050
Hauppauge, New York 11788
Telephone (631) 273-0900
Fax (631) 273-0858
www.u-g.com