10:37:22 EDT Mon 15 Jul 2024
Enter Symbol
or Name
USA
CA



Login ID:
Password:
Save

Flux Power Reports Fiscal Full Year 2023 Financial Results

2023-09-21 16:01 ET - News Release

Fiscal Full Year 2023 Revenue Increased 57% to $66.3 Million

Fiscal Full Year 2023 Gross Profit Increased 134% to $17.1 Million

Fiscal Full Year 2023 Net Cash Used in Operating Activities Decreased 85%

Strong Fortune 500 Customer Order Backlog

Management to Host Conference Call Today at 4:30 p.m. Eastern Time


Company Website: https://www.fluxpower.com/
VISTA, Calif. -- (Business Wire)

Flux Power Holdings, Inc. (NASDAQ: FLUX), a developer of advanced lithium-ion energy storage solutions for electrification of commercial and industrial equipment, has reported its financial and operational results for the fiscal fourth quarter and year ended June 30, 2023.

Key Financial & Operational Highlights for the Fourth Quarter and Fiscal Year 2023

($ millions)

Full Year Comparison

 

Q4 Comparison

 

FY 2023

FY 2022

$ Change YoY

% Change YoY

 

Q4-2023

Q4-2022

$ Change QoQ

% Change QoQ

Revenue

$66.3

$42.3

$24.0

57%

 

$16.3

$15.2

$1.1

7%

Gross Profit

$17.1

$7.3

$9.8

134%

 

$4.3

$3.0

$1.3

43%

Gross Margin

26%

17%

--

9%

 

27%

20%

--

7%

Adjusted EBITDA

-$3.7

-$14.1

$10.4

--

 

-$0.6

-$2.2

$1.6

--

  • Net cash used in operating activities decreased 64% in Q4’23 compared to Q4’23 and 85% for the year ended June 30, 2023, compared to the year ended June 30, 2022.
  • Adjusted EBITDA loss decreased 73% in Q4’23 compared to Q4’22 and decreased 74% for the year ended June 30, 2023, compared to the year ended June 30, 2022.
  • Secured a new $15 million credit facility from Gibraltar Business Capital (“GBC”) to fund working capital and to repay its existing credit facility with Silicon Valley Bank (“SVB”).
  • Commenced implementation of Artificial Intelligence (AI) features for SkyBMS® Telematics Platform to drive more informed decision-making and maximize operational efficiency.
  • Opened a new Atlanta facility to supplement customer support services in response to growth in nationwide sales of lithium-ion battery packs, enabling faster response times to Flux Power’s nationwide customer base.
  • Strategic Supply Chain & Profitability Improvement Initiatives continued to accelerate the path to cash flow breakeven.
  • Completed UL Solutions compliance testing to obtain third-party, safety and durability certification for its next-generation clean energy battery technology.
  • Added three new customers having large fleets this past quarter and 8 new customers in 2023, reflecting customers desire to fulfill long-term fleet needs of replacing lead acid battery packs with lithium-ion.

Backlog Summary

The backlog status is a point in time measure but in total reflects underlying pacing of orders:

Fiscal Quarter Ended

 

Beginning

Backlog

 

 

New Orders

 

 

Shipments

 

 

Ending

Backlog

March 31, 2022

 

$

31,415,000

 

 

$

20,495,000

 

 

$

13,317,000

 

 

$

38,593,000

June 30, 2022

 

$

38,593,000

 

 

$

11,622,000

 

 

$

15,195,000

 

 

$

35,020,000

September 30, 2022

 

$

35,020,000

 

 

$

9,678,000

 

 

$

17,840,000

 

 

$

26,858,000

December 31, 2022

 

$

26,858,000

 

 

$

20,652,000

 

 

$

17,158,000

 

 

$

30,352,000

March 31, 2023

 

$

30,352,000

 

 

$

9,751,000

 

 

$

15,087,000

 

 

$

25,016,000

June 30, 2023

 

$

25,016,000

 

 

$

19,780,000

 

 

$

16,252,000

 

 

$

28,544,000

CEO Commentary

“A high priority for us remains reaching cash flow breakeven, and we made good progress during fiscal 2023 by improving Adjusted EBITDA from a loss of $14.1 million in fiscal year 2022 to a loss of $3.7 million in fiscal year 2023, an improvement of $10.4 million. We executed on our initiatives to improve gross margins while continuing to grow our revenue at an annual rate of 57%. We added on average two new major customers each quarter while maintaining orders from existing customers.

“Managing our business growth and margin expansion has required careful priorities as part of our strategy to protect shareholder value. We migrated from our Silicon Valley Bank facility to a new $15 million credit facility with Gibraltar bank which provides lower interest rates, a two-year term, and the potential to expand the facility to $20 million to accommodate higher working capital needs as our business grows. This facility, along with our improvement in operating cash requirements, supports our current business growth. Additional credit support is provided by our unused $4.0 million subordinated line of credit (“Subordinated LOC”).

“Turning to near-term developments, firstly, we are now working to implement Artificial Intelligence features and capabilities into our SkyBMS Telematics platform, which delivers insight into equipment fleet’s usage so customers can make more informed decisions to maximize operational efficiency. With AI, we can anticipate and resolve issues before they happen, addressing the number one driver in fleet management - minimizing downtime of the equipment. Secondly, we have begun a staged launching of our updated product platform that includes the rollout of “heavy duty” models for more demanding performance, which should provide added revenue opportunities.

“To supplement our customer support for almost 20,000 lithium-ion battery packs deployed nationwide we recently announced the opening of our new Atlanta facility. This facility will enable faster response times to our customer base with an effective service and call center capability. Investment in the Atlanta office broadens our geographic footprint to bring comprehensive and responsive services to customers in the eastern half of the U.S. while also, and importantly, resulting in significantly lower service logistics costs.

“As global supply chain disruptions have lessened, we decreased our inventory balance to $19.0 million as of June 30, 2023. We did experience a lengthening of forklift OEM delivery timelines in the material handling sector that partially offset our reductions to inventory levels. To address disruptions and reduce excess inventory we have improved lean manufacturing processes and supply chain management. We have launched an automated cell module production initiative to streamline cell module SKU management and facilitate adoption of future cell suppliers that have lower costs and new technologies.

“Looking ahead, we believe our current growth and cash initiatives provide the solid operating base to build the scale necessary to be the leading provider to large Fortune 500 material handling fleets. To leverage this growth strategy we are in the early stages of exploring and developing partnerships with vendors, technology partners, and opportunities to expand our business footprint. I look forward to additional announcements in the months to come as we strive to create long-term sustainable growth and shareholder value,” concluded Dutt.

Q4’23 Financial Results

Revenue for the fiscal fourth quarter of 2023 increased by 7% to $16.3 million compared to $15.2 million in the fiscal fourth quarter of 2022, driven a higher volume of units sold with higher average selling prices, including a higher mix of Airport Ground Support Equipment “GSE” sales.

Gross profit for the fiscal fourth quarter of 2023 increased to $4.3 million compared to a gross profit of $3.0 million in the fiscal fourth quarter of 2022. Gross margin was 27% in the fiscal fourth quarter of 2023 as compared to 20% in the fiscal fourth quarter of 2022, reflecting higher volume of units sold with greater gross margin and lower cost of sales as a result of the gross margin improvement initiatives. Gross margin was sequentially lower in fiscal fourth quarter of 2023 than the third quarter, primarily reflecting a higher mix of lower margin products.

Adjusted EBITDA was a loss of $0.6 million in the fiscal fourth quarter of 2023 as compared to a loss of $2.2 million in the fiscal fourth quarter of 2022, driven by the improved gross margins.

Selling & Administrative expenses remained unchanged at $4.1 million in the fiscal fourth quarter of 2023, reflecting improving operating leverage for our ongoing revenue growth.

Research & Development expenses decreased slightly to $1.3 million in the fiscal fourth quarter of 2023, compared to $1.4 million in the fiscal fourth quarter of 2022, primarily due to lower expenses related to the development of new products.

Net loss for the fiscal fourth quarter of 2023 was $1.5 million as compared with a net loss of $2.7 million in the fiscal fourth quarter of 2022, with improvement principally reflecting increased gross profit, slightly offset by increased operating expenses and interest expense.

FY’23 Financial Results

Revenue for the fiscal year 2023 increased by 57% to $66.3 million compared to $42.3 million in the fiscal year 2022, driven by sales of energy storage solutions with higher average selling prices and a higher volume of units sold, driven by significant increases in GSE sales.

Gross Profit for the fiscal year 2023 increased to $17.1 million compared to a gross profit of $7.3 million in the fiscal year 2022. Gross margin was 26% in the fiscal year 2023 as compared to 17% in the fiscal year 2022, reflecting a higher volume of units sold with greater gross margin and lower cost of sales as a result of the gross margin improvement initiatives.

Adjusted EBITDA was a loss of $3.7 million in the fiscal year 2023 as compared to a loss of $14.1 million in the fiscal year 2022, driven by the improved gross margins.

Selling & Administrative expenses increased to $17.6 million in the fiscal year 2023 from $15.5 million in the fiscal year 2022, primarily attributable to increases in outbound shipping costs, depreciation expense, insurance premiums, severance expenses, new hires, partially offset by decreases in commissions, bad debt expenses, consulting fees, public relations expenses, and stock-based compensation.

Research & Development expenses decreased to $4.9 million in the fiscal year 2023, compared to $7.1 million in the fiscal year 2022, primarily due to lower expenses related to the development of new products.

Net loss for the fiscal year 2023 was $6.7 million as compared with a net loss of $15.6 million in the fiscal year 2022, with improvement principally reflecting increased gross profit, partially offset by increased operating expenses and interest expense.

Cash was $2.4 million at June 30, 2023, as compared to $0.5 million at June 30, 2022. Available working capital includes: our line of credit as of September 8, 2023, under our $15.0 million credit facility from Gibraltar Business Capital with a remaining available balance of $4.0 million; and $4.0 million available under the subordinated line of credit (“Subordinated LOC”).

Net cash used in operating activities decreased to $3.6 million in fiscal year 2023 compared to $23.9 million in fiscal year 2022, primarily due to a decrease in net loss and an increase in accounts payable.

Fourth Quarter & Full Fiscal Year 2023 Results Conference Call

Flux Power CEO Ron Dutt and CFO Chuck Scheiwe will host the conference call, followed by a question-and-answer session. The conference call will be accompanied by a presentation, which can be viewed during the webcast or accessed via the investor relations section of the Company’s website here.

To access the call, please use the following information:

Date:

Thursday, September 21, 2023

Time:

4:30 p.m. Eastern Time, 1:30 p.m. Pacific Time

Toll-free dial-in number:

1-877-407-4018

International dial-in number:

1-201-689-8471

Conference ID:

13739638

Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact MZ Group at 1-949-491-8235.

The conference call will be broadcast live and available for replay at https://viavid.webcasts.com/starthere.jsp?ei=1622559&tp_key=bfd2206c1f and via the investor relations section of the Company's website here.

A replay of the webcast will be available after 7:30 p.m. Eastern Time through December 31, 2023.

Toll-free replay number:

1-844-512-2921

International replay number:

1-412-317-6671

Replay ID:

13739638

Note about Non-GAAP Financial Measures

A non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with accounting principles generally accepted in the United States of America, or GAAP. Non-GAAP measures are not in accordance with, nor are they a substitute for, GAAP measures. Other companies may use different non-GAAP measures and presentation of results.

In addition to financial results presented in accordance with GAAP, this press release presents adjusted EBITDA, which is a non-GAAP measure. Adjusted EBITDA is determined by taking net loss and adding interest, taxes, depreciation, amortization, and stock-based compensation expenses. The company believes that this non-GAAP measure, viewed in addition to and not in lieu of net loss, provides additional information to investors by providing a more focused measure of operating results. This metric is an integral part of the Company’s internal reporting to evaluate its operations and the performance of senior management. A reconciliation of adjusted EBITDA to net loss, the most comparable GAAP measure, is available in the accompanying financial tables below. The non-GAAP measure presented herein may not be comparable to similarly titled measures presented by other companies.

US-GAAP NET INCOME (LOSS) TO ADJUSTED EBITDA RECONCILIATION

(Unaudited)

 

 

Years Ended June 30,

 

 

 

2023

 

 

2022

 

Net loss

 

$

(6,741,000

)

 

$

(15,609,000

)

Interest, net

 

 

1,339,000

 

 

 

252,000

 

Income tax provision

 

 

-

 

 

 

-

 

Depreciation and amortization

 

 

899,000

 

 

 

575,000

 

EBITDA

 

 

(4,503,000

)

 

 

(14,782,000

)

Stock-based compensation

 

 

798,000

 

 

 

711,000

 

Adjusted EBITDA

 

$

(3,705,000

)

 

$

(14,071,000

)

About Flux Power Holdings, Inc.

Flux Power (NASDAQ: FLUX) designs, manufactures, and sells advanced lithium-ion energy storage solutions for electrification of a range of industrial and commercial sectors including material handling, airport ground support equipment (GSE), and stationary energy storage. Flux Power’s lithium-ion battery packs, including the proprietary battery management system (BMS) and telemetry, provide customers with a better performing, lower cost of ownership, and more environmentally friendly alternative, in many instances, to traditional lead acid and propane-based solutions. Lithium-ion battery packs reduce CO2 emissions and help improve sustainability and ESG metrics for fleets. For more information, please visit www.fluxpower.com.

Forward-Looking Statements

This release contains projections and other "forward-looking statements" relating to Flux Power’s business, that are often identified using "believes," "expects" or similar expressions. Forward-looking statements involve several estimates, assumptions, risks, and other uncertainties that may cause actual results to be materially different from those anticipated, believed, estimated, expected, etc. Such forward-looking statements include impact of COVID-19 on Flux Power’s business, results and financial condition; Flux Power’s ability to obtain raw materials and other supplies for its products at competitive prices and on a timely basis, particularly in light of the potential impact of the COVID-19 pandemic on its suppliers and supply chain; the development and success of new products, projected sales, cancellation of purchase orders, deferral of shipments, Flux Power’s ability to improve its gross margins, or achieve breakeven cash flow or profitability, Flux Power’s ability to fulfill backlog orders or realize profit from the contracts reflected in backlog sale; Flux Power’s ability to fulfill backlog orders due to changes in orders reflected in backlog sales, Flux Power’s ability to obtain the necessary funds under the credit facilities, Flux Power’s ability to timely obtain UL Listing for its products, Flux Power’s ability to fund its operations, distribution partnerships and business opportunities and the uncertainties of customer acceptance and purchase of current and new products, and changes in pricing, and Flux Power’s ability to negotiate and enter into a definitive agreement in connection with the Letter of Intent. Actual results could differ from those projected due to numerous factors and uncertainties. Although Flux Power believes that the expectations, opinions, projections, and comments reflected in these forward-looking statements are reasonable, they can give no assurance that such statements will prove to be correct, and that the Flux Power’s actual results of ‎operations, financial condition and performance will not differ materially from the ‎results of operations, financial condition and performance reflected or implied by these forward-‎looking statements. Undue reliance should not be placed on the forward-looking statements and Investors should refer to the risk factors outlined in our Form 10-K, 10-Q and other reports filed with the SEC and available at www.sec.gov/edgar. These forward-looking statements are made as of the date of this news release, and Flux Power assumes no obligation to update these statements or the reasons why actual results could differ from those projected.

Flux, Flux Power, and associated logos are trademarks of Flux Power Holdings, Inc. All other third-party brands, products, trademarks, or registered marks are the property of and used to identify the products or services of their respective owners.

Follow us at:

Blog: Flux Power Blog
News Flux Power News
Twitter: @FLUXpwr
LinkedIn: Flux Power

FLUX POWER HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS

 

 

June 30,

2023

 

 

June 30,

2022

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash

 

$

2,379,000

 

 

$

485,000

 

Accounts receivable

 

 

8,649,000

 

 

 

8,609,000

 

Inventories, net

 

 

18,996,000

 

 

 

16,262,000

 

Other current assets

 

 

918,000

 

 

 

1,261,000

 

Total current assets

 

 

30,942,000

 

 

 

26,617,000

 

 

 

 

 

 

 

 

 

 

Right of use asset

 

 

2,854,000

 

 

 

2,597,000

 

Property, plant and equipment, net

 

 

1,789,000

 

 

 

1,578,000

 

Other assets

 

 

120,000

 

 

 

89,000

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

35,705,000

 

 

$

30,881,000

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

9,735,000

 

 

$

6,645,000

 

Accrued expenses

 

 

3,181,000

 

 

 

2,209,000

 

Revolving line of credit

 

 

9,912,000

 

 

 

4,889,000

 

Deferred revenue

 

 

131,000

 

 

 

163,000

 

Customer deposits

 

 

82,000

 

 

 

175,000

 

Finance lease payable, current portion

 

 

143,000

 

 

 

-

 

Office lease payable, current portion

 

 

644,000

 

 

 

504,000

 

Accrued interest

 

 

2,000

 

 

 

1,000

 

Total current liabilities

 

 

23,830,000

 

 

 

14,586,000

 

 

 

 

 

 

 

 

 

 

Long term liabilities:

 

 

 

 

 

 

 

 

Finance lease payable, less current portion

 

 

273,000

 

 

 

-

 

Office lease payable, less current portion

 

 

2,055,000

 

 

 

2,361,000

 

 

 

 

 

 

 

 

 

 

Total liabilities

 

 

26,158,000

 

 

 

16,947,000

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

 

 

Preferred stock, $0.001 par value; 500,000 shares authorized; none issued and outstanding

 

 

-

 

 

 

-

 

Common stock, $0.001 par value; 30,000,000 shares authorized; 16,462,215 and 15,996,658 shares issued and outstanding at June 30, 2023 and June 30, 2022, respectively

 

 

16,000

 

 

 

16,000

 

Additional paid-in capital

 

 

98,086,000

 

 

 

95,732,000

 

Accumulated deficit

 

 

(88,555,000

)

 

 

(81,814,000

)

Total stockholders’ equity

 

 

9,547,000

 

 

 

13,934,000

 

Total liabilities and stockholders’ equity

 

$

35,705,000

 

 

$

30,881,000

 

FLUX POWER HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

 

 

 

Years ended
June 30,

 

 

 

2023

 

 

2022

 

Revenues

 

$

66,337,000

 

 

$

42,333,000

 

Cost of sales

 

 

49,237,000

 

 

 

35,034,000

 

 

 

 

 

 

 

 

 

 

Gross profit

 

 

17,100,000

 

 

 

7,299,000

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

Selling and administrative

 

 

17,620,000

 

 

 

15,515,000

 

Research and development

 

 

4,890,000

 

 

 

7,141,000

 

Total operating expenses

 

 

22,510,000

 

 

 

22,656,000

 

 

 

 

 

 

 

 

 

 

Operating loss

 

 

(5,410,000

)

 

 

(15,357,000

)

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

Other income

 

 

8,000

 

 

 

-

 

Interest expense

 

 

(1,339,000

)

 

 

(252,000

)

 

 

 

 

 

 

 

 

 

Net loss

 

$

(6,741,000

)

 

$

(15,609,000

)

 

 

 

 

 

 

 

 

 

Net loss per share - basic and diluted

 

$

(0.42

)

 

$

(1.01

)

 

 

 

 

 

 

 

 

 

Weighted average number of common shares outstanding - basic and diluted

 

 

16,055,256

 

 

 

15,439,530

 

FLUX POWER HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

 

Year ended June 30,

 

 

 

2023

 

 

2022

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

Net loss

 

$

(6,741,000

)

 

$

(15,609,000

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

 

Depreciation

 

 

899,000

 

 

 

575,000

 

Stock-based compensation

 

 

798,000

 

 

 

711,000

 

Fair value of warrants issued as debt discount cost

 

 

-

 

 

 

253,000

 

Amortization of debt issuance costs

 

 

482,000

 

 

 

-

 

Noncash lease expense

 

 

512,000

 

 

 

438,000

 

Allowance for inventory reserve

 

 

-

 

 

 

61,000

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

(40,000

)

 

 

(2,512,000

)

Inventories

 

 

(2,734,000

)

 

 

(5,810,000

)

Other current assets

 

 

(170,000

)

 

 

(802,000

)

Accounts payable

 

 

3,090,000

 

 

(530,000

)

Accrued expenses

 

 

972,000

 

 

(374,000

)

Deferred revenue

 

 

(32,000

)

 

 

139,000

 

Accrued interest

 

 

1,000

 

 

(1,000

)

Office lease payable

 

 

(518,000

)

 

 

(436,000

)

Customer deposits

 

 

(93,000

)

 

 

4,000

Net cash used in operating activities

 

 

(3,574,000

)

 

 

(23,893,000

)

 

 

 

 

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

Purchases of equipment

 

 

(1,032,000

)

 

 

(797,000

)

Proceeds from sale of fixed assets

 

 

8,000

 

 

-

Net cash used in investing activities

 

 

(1,024,000

)

 

 

(797,000

)

 

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

Proceeds from the issuance of common stock in registered direct offering, net of offering costs

 

 

-

 

 

 

13,971,000

 

Proceeds from the issuance of common stock in public offering, net of offering costs

 

 

1,556,000

 

 

 

1,602,000

 

Proceeds from revolving line of credit

 

 

63,400,000

 

 

 

8,450,000

 

Payment of revolving line of credit

 

 

(58,377,000

)

 

 

(3,561,000

)

Payment of financed leases

 

 

(87,000

)

 

 

-

Net cash provided by financing activities

 

 

6,492,000

 

 

 

20,462,000

 

 

 

 

 

 

 

 

 

 

Net change in cash

 

 

1,894,000

 

 

(4,228,000

)

Cash, beginning of period

 

 

485,000

 

 

 

4,713,000

 

 

 

 

 

 

 

 

 

 

Cash, end of period

 

$

2,379,000

 

 

$

485,000

 

 

 

 

 

 

 

 

 

 

Supplemental Disclosures of Non-Cash Investing and Financing Activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Initial right of use asset recognition

 

$

855,000

 

 

$

-

 

Common stock issued for vested RSUs

 

$

417,000

 

 

$

21,000

 

Supplemental cash flow information:

 

 

 

 

 

 

 

 

Interest paid

 

$

1,127,000

 

 

$

151,000

 

 

Contacts:

Media & Investor Relations:
info@fluxpower.com

External Investor Relations:
Chris Tyson, Executive Vice President
MZ Group - MZ North America
949-491-8235
FLUX@mzgroup.us
www.mzgroup.us

Source: Flux Power Holdings, Inc.

© 2024 Canjex Publishing Ltd. All rights reserved.