- Revenue was $49.7 million for the quarter, a decrease of 28%
from the prior year quarter
- Net loss per basic and diluted common share was $(1.90),
compared to net income per basic and diluted common share of $0.31
and $0.28, respectively, in the prior year quarter
- Adjusted EBITDA decreased by $5.0 million to $4.9 million from
the prior year quarter
- Ended quarter with $18.4 million in Cash, $61.4 million in
Working Capital and $30.6 million in Stockholders’ Equity
- Expect Q4 2023 Revenue and adjusted EBITDA to remain flat with
prior year at $43 million and $3 million, respectively
- Sales orders increased 11% to $48.5 million
Boxlight Corporation (Nasdaq: BOXL) (“Boxlight” or the
“Company”), a leading provider of interactive technology solutions,
today announced the Company’s financial results for the third
quarter ended September 30, 2023.
Key Financial Highlights for Q3 2023 as Compared to Q3
2022
- Revenue decreased by 28% to $49.7 million
- Customer orders increased 11% to $49.4 million
- Gross profit margin improved by 570 basis points to 36.3%
- Net loss was $17.8 million compared to net income of $3.1
million
- Adjusted EBITDA decreased by $4.9 million to $4.9 million
- Net loss per basic and diluted common share was $(1.90),
compared to net income per basic and diluted common share of $0.31
and $0.28, respectively
- Ended the quarter with $18.4 million in Cash, $61.4 million in
Working Capital and $30.6 million in Stockholders’ Equity
Key Business Highlights for Q3 2023
- Received key U.S. customer orders of $7.0 million from ELB,
$5.0 million from Bluum, $2.6 million from Camera Mundi and $1.2
million from Graphics Distribution.
- Received key international customer orders of $2.3 million from
Information and Data Networks Supplies (UK), $1.5 million from
TASTEONE AV- & IT-Solutions (Germany) and $1.2 million from
CANCOM (Germany).
- Received nine Tech & Learning Best for Back to School
Awards across multiple products and brands including MimioWall,
MimioDS, MyBot Recruit, IMPACT Lux and Teacher Action! Mic.
- Won Digital Signage Technology of the Year for CleverLive at
the 2023 AV Awards.
- Announced the release of the first Google EDLA certified
interactive flat panel, the Clevertouch IMPACT Lux and Mimio ProG,
bundled with accelerated Level 1 and Level 2 Google Certification
teacher training.
- Expanded the Clevertouch CM Series, which now includes high
bright panels, totems, 16/7 and 24/7 displays, menu boards and LED
Video walls.
Management Commentary
“We saw a decline in revenue for the third quarter, largely due
to softer industry demand,” commented Michael Pope, Chairman and
Chief Executive Officer. “However, we did see improved customer
demand as indicated by customer order growth. For the fourth
quarter, we expect revenue and Adjusted EBITDA to be in line with
the fourth quarter of 2022. Looking forward to 2024, we are
optimistic that we will return to revenue growth and deliver
improved profitability.”
Financial Results for the Three Months Ended September 30,
2023
Total revenues for the three months ended September 30, 2023
were $49.7 million as compared to $68.7 million for the three
months ended September 30, 2022, resulting in a 27.7% decrease. The
decrease in revenues was primarily due to lower sales volume across
all markets.
Cost of revenues for the three months ended September 30, 2023
were $31.7 million as compared to $47.7 million for the three
months ended September 30, 2022, resulting in a 33.7% decrease. The
decrease in cost of revenues was attributable to the decrease in
units sold, along with lower manufacturing and shipping costs in
the third quarter of 2023 compared to the prior year’s third
quarter.
Gross profit for the three months ended September 30, 2023 was
$18.0 million as compared to $21.0 million for the three months
ended September 30, 2022, resulting in a decrease of 14.3%. Gross
profit margin increased to 36.3% for the three months September 30,
2023 and 30.6% for the three months ending September 30, 2022. The
increase in gross profit margin is primarily related to the
decrease in manufacturing and shipping costs noted above.
Total operating expenses for the three months ended September
30, 2023 were $29.6 million, accounting for 59.6% of revenues, as
compared to $14.6 million and 21.2% of revenues for the three
months ended September 30, 2022. The increase in operating expenses
was due to Goodwill impairment charges of $13.2 million recognized
during the three months ended September 30, 2023. There were no
impairment charges during 2022.
Other expense, net for the three months ended September 30, 2023
was $3.0 million as compared to $2.8 million for the three months
ended September 30, 2022, representing an increase of $0.2 million.
The increase in other expenses was primarily due to a $0.4 million
increase in interest expense, partially offset by a $0.2 million
change in the fair value of derivative liabilities.
Net loss was $17.8 million for the three months ended September
30, 2023. Net income was $3.1 million for the three months ended
September 30, 2022 and was a result of the changes noted above.
The net loss attributable to common shareholders was $18.1
million for the three months ended September 30, 2023. Net income
attributable to common shareholders was $2.8 million for the three
months ended September 30, 2022, after deducting fixed dividends
paid to Series B preferred shareholders of $0.3 million in both
years.
Total comprehensive loss was $20.6 million and $1.9 million for
the three months ended September 30, 2023 and 2022, respectively.
The change reflects the effect of foreign currency translation
adjustments on consolidation, with the net effect of a $2.9 million
loss for the three months ended September 30, 2023 and a $5.0
million loss for the three months ended September 30, 2022.
Basic and diluted EPS for the three months ended September 30,
2023 was $(1.90). Basic and diluted EPS for the three months ended
September 30, 2022 was $0.31 and $0.28, respectively.
EBITDA loss for the three months ended September 30, 2023 was
$9.4 million, as compared to $8.5 million EBITDA for the three
months ended September 30, 2022.
Adjusted EBITDA for the three months ended September 30, 2023
was $4.9 million, as compared to $9.9 million for the three months
ended September 30, 2022. Adjustments to EBITDA included
stock-based compensation expense, impairment of goodwill,
gains/losses recognized upon the settlement of certain debt
instruments, gains/losses from the remeasurement of derivative
liabilities, and the effects of purchase accounting adjustments in
connection with prior period acquisitions.
At September 30, 2023, Boxlight had $18.4 million in cash and
cash equivalents, $61.4 million in working capital, $44.1 million
in inventory, $180.4 million in total assets, $44.4 million in
debt, net of debt issuance costs, $30.6 million in stockholders’
equity, 9.6 million common shares issued and outstanding, and 3.1
million preferred shares issued and outstanding.
Financial Results for the Nine Months Ended September 30,
2023
Total revenues for the nine months ended September 30, 2023 were
$137.9 million as compared to $179.0 million for the nine months
ended September 30, 2022, resulting in a 22.9% decrease. The
decrease in revenues was primarily due to lower sales volume across
all markets.
Cost of revenues for the nine months ended September 30, 2023
were $86.9 million as compared to $128.5 million for the nine
months ended September 30, 2022, resulting in a 32.4% decrease. The
decrease in cost of revenues was attributable to the decrease in
units sold, along with lower manufacturing and shipping costs in
the first three quarters of 2023 compared to the first three
quarters of the prior year.
Gross profit for the nine months ended September 30, 2023 was
$51.0 million as compared to $50.5 million for the nine months
ended September 30, 2022, an increase of 1.0%. The gross profit
margin was 37.0% for the nine months ended September 30, 2023 and
28.2% for the nine months ended September 30, 2022. The increase in
gross profit is primarily related to the decrease in manufacturing
and shipping costs noted above.
Total operating expenses for the nine months ended September 30,
2023 were $60.7 million as compared to $46.6 million for the nine
months ended September 30, 2022. The increase in operating expenses
was due to goodwill impairment charges of $13.2 million during the
nine months ended September 30, 2023. There were no impairment
charges during 2022.
Other expense, net for the nine months ended September 30, 2023
was $8.4 million as compared to $5.1 million for the nine months
ended September 30, 2022, representing an increase of $3.3 million.
The increase was due to a $1.5 million decrease in the fair value
of derivative liabilities, a $0.9 million increase in interest
expense, and a gain of $0.9 million recognized upon the settlement
of certain debt obligations during the nine months ended September
30, 2022.
The Company reported net loss of $21.5 million and $1.7 million
for the nine months ended September 30, 2023 and 2022,
respectively, and was a result of the changes noted above.
Net loss attributable to common shareholders was $22.4 million
and $2.7 million for the nine months ended September 30, 2023 and
2022, respectively, after deducting fixed dividends paid to Series
B preferred shareholders of approximately $1.0 million in both
years.
Total comprehensive loss was $22 million and $13 million for the
nine months ended September 30, 2023 and 2022, respectively,
reflecting the effect of cumulative foreign currency translation
adjustments on consolidation, with the net effect year to date of
$0.6 million and $11.4 million loss for the nine months ended
September 30, 2023 and 2022, respectively.
Basic and diluted EPS for the nine months ended September 30,
2023 was $(2.39) per basic and diluted share, compared to $(0.32)
per basic and diluted share for the nine months ended September 30,
2022.
EBITDA loss for the nine months ended September 30, 2023 was
$3.0 million, as compared to $12.9 million EBITDA for the nine
months ended September 30, 2022.
Adjusted EBITDA for the nine months ended September 30, 2023 was
$13.7 million, as compared to $16.3 million for the nine months
ended September 30, 2022. Adjustments to EBITDA include stock-based
compensation expense, impairment of goodwill gains/losses
recognized upon the settlement of certain debt instruments,
gains/losses from the remeasurement of derivative liabilities, and
the effects of purchase accounting adjustments in connection with
acquisitions.
Third Quarter 2023 Financial Results Conference Call
The Company will hold a conference call to announce its third
quarter 2023 financial results on Wednesday, November 8, 2023, at
4:30 p.m. Eastern Time.
The conference call details are as
follows:
Date:
Wednesday, November 8, 2023
Time:
4:30 p.m. Eastern Time / 1:30 p.m. Pacific
Time
Dial-in:
1-888-506-0062 (Domestic)
1-973-528-0011 (International)
Participant Access Code:
391836
Webcast:
https://www.webcaster4.com/Webcast/Page/2213/49195
For those unable to participate during the live broadcast, a
replay of the conference call will be available until 11:59 p.m.
Eastern Time on Wednesday, Wednesday, November 22, 2023, by dialing
1-877-481-4010 (domestic) and 1-919-882-2331 (international) and
referencing the replay passcode 49195.
Use of Non-GAAP Financial Measures
To provide investors with additional insight and allow for a
more comprehensive understanding of the information used by
management in its financial and decision-making surrounding pro
forma operations, we supplement our consolidated financial
statements presented on a basis consistent with U.S. generally
accepted accounting principles, or GAAP, with EBITDA and Adjusted
EBITDA, which are non-GAAP financial measures of earnings. EBITDA
represents net income before income tax expense (benefit), interest
expense, depreciation and amortization. Adjusted EBITDA represents
EBITDA plus stock-based compensation, impairment of goodwill, the
change in fair value of derivative liabilities, purchase accounting
impact of inventory markup, fair value adjustments to deferred
revenue, non-cash gains and losses associated with debt settlement.
Our management uses EBITDA and Adjusted EBITDA as financial
measures to evaluate the profitability and efficiency of our
business model. We use these non-GAAP financial measures to assess
the strength of the underlying operations of our business. These
adjustments, and the non-GAAP financial measures that are derived
from them, provide supplemental information to analyze our
operations between periods and over time. We find this especially
useful when reviewing pro forma results of operations, which
include large non-cash amortizations of intangible assets from
acquisitions and stock-based compensation. Investors should
consider our non-GAAP financial measures in addition to, and not as
a substitute for, financial measures prepared in accordance with
GAAP.
We report our operating results in accordance with U.S. GAAP. We
have disclosed in the table below the results on a constant
currency basis to facilitate period-to-period comparisons of our
results without regard to the impact of fluctuating foreign
currency exchange rates. The term foreign currency exchange rates
refers to the exchange rates we use to translate our operating
results into U.S. Dollars for all countries where the functional
currency is not the U.S. Dollar. Because we are a global company,
the foreign currency exchange rates used for translation may have a
significant effect on our reported results. In general, our
reported financial results are affected positively by a weaker U.S.
Dollar and are affected negatively by a stronger U.S. Dollar as
compared to the foreign currencies in which we conduct our
business. References to our operating results on a
constant-currency basis mean our operating results without the
impact of foreign currency exchange rate fluctuations.
We believe disclosure of constant-currency results is helpful to
investors because it facilitates period-to-period comparisons of
our results by increasing the transparency of our underlying
performance by excluding the impact of fluctuating foreign currency
exchange rates. However, constant-currency results are non-U.S.
GAAP financial measures and are not meant to be considered in
isolation or as a substitute for comparable measures prepared in
accordance with U.S. GAAP. Constant-currency results have no
standardized meaning prescribed by U.S. GAAP, are not prepared
under any comprehensive set of accounting rules or principles, and
should be read in conjunction with our consolidated financial
statements prepared in accordance with U.S. GAAP. Constant-currency
results have limitations in their usefulness to investors and may
be calculated differently from, and therefore may not be directly
comparable to, similarly titled measures used by other
companies.
Discussion of the Effect of Constant Currency on Financial
Condition
We calculate constant-currency amounts by translating local
currency amounts in the current period at actual foreign exchange
rates for the prior year period. Our constant-currency results do
not eliminate the transaction currency impact of purchases and
sales of products in a currency other than the functional
currency.
Three Months Ended
September 30, 2023
Three Months Ended
September 30, 2022
% Decrease
(Dollars in thousands)
Total revenues
As reported
$
49,667
$
68,736
(28
)%
Impact of foreign currency translation
(1,705
)
-
Constant-currency
$
47,962
$
68,736
(30
)%
Nine Months Ended
September 30, 2023
Nine Months Ended
September 30, 2022
% Decrease
(Dollars in thousands)
Total revenues
As reported
$
137,909
$
178,967
(23
)%
Impact of foreign currency translation
752
-
Constant-currency
$
138,661
$
178,967
(23
)%
About Boxlight Corporation
Boxlight Corporation (Nasdaq: BOXL) is a leading provider of
interactive technology solutions under its award-winning brands
Clevertouch®, FrontRow™ and Mimio®. Boxlight aims to improve
engagement and communication in diverse business and education
environments. Boxlight develops, sells, and services its integrated
solution suite including interactive displays, collaboration
software, audio solutions, supporting accessories, and professional
services. For more information about Boxlight and the Boxlight
story, visit http://www.boxlight.com, https://www.clevertouch.com
and https://www.gofrontrow.com.
Forward Looking Statements
This press release may contain information about Boxlight’s view
of its future expectations, plans and prospects that constitute
forward-looking statements. Actual results may differ materially
from historical results or those indicated by these forward-looking
statements as a result of a variety of factors including, but not
limited to, risks and uncertainties associated with its ability to
maintain and grow its business, variability of operating results,
its development and introduction of new products and services,
marketing and other business development initiatives, and
competition in the industry, among other things. Boxlight
encourages you to review other factors that may affect its future
results and performance in Boxlight’s filings with the Securities
and Exchange Commission, including its Annual Report on Form 10-K
for the year ended December 31, 2022, as filed on March 17, 2023,
and its Quarterly Report on Form 10-Q filed on August 9, 2023.
Boxlight Corporation
Condensed Consolidated Balance
Sheets
As of September 30, 2023 and
December 31, 2022
(in thousands, except share
and per share amounts)
September 30,
2023
December 31,
2022
(Unaudited)
(as adjusted)*
ASSETS
Current assets:
Cash and cash equivalents
$
18,415
$
14,591
Accounts receivable – trade, net of
allowances
40,421
31,009
Inventories, net of reserves
44,142
58,211
Prepaid expenses and other current
assets
8,099
7,433
Total current assets
111,077
111,244
Property and equipment, net of accumulated
depreciation
1,500
1,733
Operating lease right of use asset
8,428
4,350
Intangible assets, net of accumulated
amortization
46,547
52,579
Goodwill
11,969
25,092
Other assets
851
397
Total assets
$
180,372
$
195,395
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Accounts payable and accrued expenses
$
35,988
$
36,566
Short-term debt
1,022
845
Operating lease liabilities, current
1,570
1,898
Deferred revenues, current
8,202
8,308
Derivative liabilities
422
472
Other short-term liabilities
2,441
386
Total current liabilities
49,645
48,475
Deferred revenues, non-current
15,531
15,603
Long-term debt
43,355
43,778
Deferred tax liabilities, net
5,584
4,680
Operating lease liabilities,
non-current
7,106
2,457
Total liabilities
121,221
114,993
Mezzanine equity:
Preferred Series B, 1,586,620 shares
issued and outstanding
16,146
16,146
Preferred Series C, 1,320,850 shares
issued and outstanding
12,363
12,363
Total mezzanine equity
28,509
28,509
Stockholders’ equity:
Preferred stock, $0.0001 par value,
50,000,000 shares authorized; 167,972 and 167,972 shares issued and
outstanding, respectively
—
—
Common stock, $0.0001 par value,
68,750,000 shares authorized; 9,605,360 and 9,339,587 Class A
shares issued and outstanding, respectively
1
1
Additional paid-in capital
118,733
117,849
Accumulated deficit
(86,604
)
(65,043
)
Accumulated other comprehensive loss
(1,488
)
(914
)
Total stockholders’ equity
30,642
51,893
Total liabilities and stockholders’
equity
$
180,372
$
195,395
* As adjusted for reverse stock split.
Boxlight Corporation
Condensed Consolidated
Statements of Operations and Comprehensive Loss
For the three and nine months
ended September 30, 2023 and 2022
(Unaudited)
(in thousands, except per
share amounts)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2023
2022
2023
2022
Revenues, net
$
49,667
$
68,736
$
137,909
$
178,967
Cost of revenues
31,653
47,716
86,919
128,497
Gross profit
18,014
21,020
50,990
50,470
Operating expense:
General and administrative
15,408
13,952
45,366
44,714
Research and development
979
604
2,101
1,865
Impairment of goodwill
13,226
—
13,226
—
Total operating expense
29,613
14,556
60,693
46,579
(Loss) income from operations
(11,599
)
6,464
(9,703
)
3,891
Other (expense) income:
Interest expense, net
(2,987
)
(2,598
)
(8,222
)
(7,330
)
Other expense, net
(181
)
(128
)
(231
)
(204
)
Gain on settlement of liabilities, net
—
—
—
856
Change in fair value of derivative
liabilities
90
(113
)
50
1,537
Total other expense
(3,078
)
(2,839
)
(8,403
)
(5,141
)
(Loss) income before income taxes
$
(14,677
)
$
3,625
$
(18,106
)
$
(1,250
)
Income tax expense
(3,073
)
(520
)
(3,379
)
(475
)
Net (loss) income
$
(17,750
)
$
3,105
$
(21,485
)
$
(1,725
)
Fixed dividends - Series B Preferred
(317
)
(317
)
(952
)
(952
)
Net (loss) income attributable to common
stockholders
$
(18,067
)
$
2,788
$
(22,437
)
$
(2,677
)
Comprehensive loss:
Net (loss) income
$
(17,750
)
$
3,105
$
(21,485
)
$
(1,725
)
Other comprehensive loss:
Foreign currency translation
adjustment
(2,854
)
(5,040
)
(574
)
(11,449
)
Total comprehensive loss
$
(20,604
)
$
(1,935
)
$
(22,059
)
$
(13,174
)
Net (loss) income per common share –
basic, as adjusted
$
(1.90
)
$
0.31
$
(2.39
)
$
(0.32
)
Net (loss) income per common share -
diluted, as adjusted
$
(1.90
)
$
0.28
$
(2.39
)
$
(0.32
)
Weighted average number of common shares
outstanding – basic, as adjusted
9,484
8,943
9,399
8,432
Weighted average number of common shares
outstanding – diluted, as adjusted
9,484
11,197
9,399
8,432
* As adjusted for reverse stock split.
Reconciliation of net (loss)
income for the three and nine months September 30, 2023 and 2022 to
EBITDA and
Adjusted EBITDA
(in thousands)
Three Months Ended
September 30, 2023
Three Months Ended
September 30, 2022
Nine Months Ended
September 30, 2023
Nine Months Ended
September 30, 2022
Net (Loss) Income
$
(17,750
)
$
3,105
$
(21,485
)
$
(1,725
)
Depreciation and amortization
2,332
2,231
6,893
6,818
Interest expense
2,987
2,598
8,222
7,330
Income tax expense
3,073
520
3,379
475
EBITDA
$
(9,358
)
$
8,454
$
(2,991
)
$
12,898
Stock compensation expense
671
603
1,823
2,665
Change in fair value of derivative
liabilities
(90
)
113
(50
)
(1,537
)
Purchase accounting impact of fair valuing
inventory
113
189
336
1,395
Purchase accounting impact of fair valuing
deferred revenue
366
509
1,308
1,747
Gain on settlement of debt
—
—
—
(856
)
Impairment of goodwill
13,226
—
13,226
—
Adjusted EBITDA
$
4,928
$
9,868
$
13,652
$
16,312
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231108025245/en/
Media Sunshine Nance +1 360-464-2119 x254
sunshine.nance@boxlight.com Investor Relations Greg Wiggins
+1 360-464-4478 investor.relations@boxlight.com
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