Company to Host Conference Call Today, November
14th, at 4:30 PM Eastern Time (details below)
Safe & Green Holdings Corp. (NASDAQ: SGBX) (“Safe &
Green Holdings” or the “Company”), a leading developer,
designer, and fabricator of modular structures for residential,
commercial, and point-of-care medicine, reported results for the
three months ended September 30, 2023.
Recent Highlights:
- Achieves 48% year-over-year increase in manufacturing &
construction services revenue for the third quarter of 2023
- SG Echo awarded multi-million-dollar contract to supply
additional modular units to a long-standing private infrastructure
solutions client
- SG Echo received Louisiana licensure to tag modular-built
products in the state of Louisiana
- Selected by the Tunnel to Towers Foundation to construct a
traveling modular home, the Comfort Home Show model, designed to
showcase the foundation’s Homeless Veteran Program; partnered with
Impact Housing to construct 3 modular Comfort Homes for the
Foundation in Houston, Texas
- Announced launch of CORNERSTONE Charitable Foundation and plans
to construct a schoolhouse in Cape Coast, Ghana, as part of the
Ghana’s Tomorrow Project
- Completed the spin-off of the Company’s real estate development
subsidiary, Safe and Green Development Corporation (NASDAQ:
SGD)
- Reduced operating expenses by more than $2 million since Q1
2023, resulting in savings that are expected to be realized in
2024
“During the third quarter of 2023, the Company experienced a 48%
year-over-year increase in manufacturing & construction
services revenue, building on our recent momentum," stated Paul
Galvin, Chairperson and CEO of Safe & Green Holdings. “During
the quarter, we celebrated the spin-off of SG Development Corp.
(“SG DevCo”) into an independent, publicly traded company after
more than a year of dedicated effort and hard work from our team.
We anticipate ongoing and significant synergies with SG DevCo as it
executes on plans to commence development of projects in the
pipeline, which currently exceed $800 million and are expected to
drive further manufacturing revenue growth for SG Echo.”
"Importantly, Safe & Green Holdings is building out its
production capacity to support growth among existing as well as new
clients. SG Echo was recently awarded a multi-million-dollar
contract to supply additional modular units to a long-standing
private infrastructure solutions client, highlighting the quality
of our work and ability to generate strong repeat business. We were
also granted Louisiana licensure for tagging modular-built products
within the state. This significant achievement confirms that our
units adhere to the state's strict standards and regulations.
Acquiring this state licensure is crucial for our Company as it
permits operations throughout Louisiana. While licensure isn’t
mandatory for modular structures in every state, our goal is to
obtain it in additional states, reinforcing and expanding our
presence across the entire United States. We are already licensed
in Florida, Texas, Colorado, Arizona, and New Mexico, and are in
the process of expanding licensure to California, Georgia, Oregon,
and Nevada.”
“We are also proud to have been selected by the Tunnel to Towers
Foundation to construct a traveling modular home, the Comfort Home
Show model, designed to showcase the foundation’s Homeless Veteran
Program. Additionally, we announced the launch of the CORNERSTONE
Charitable Foundation, a 501(c)(3) organization focused on
providing global services for affordable housing, primary
care/point of care medicine, the provision of clean potable water
and education by leveraging modular solutions. We plan to leverage
the relationship with CORNERSTONE by providing cost-effective
modular solutions, manufactured by SG Echo. Notably, as a first
project, we are partnering with CORNERSTONE to construct a
schoolhouse in Cape Coast, Ghana, as part of the Ghana’s Tomorrow
Project. This relationship demonstrates the social and economic
benefits when the corporate sectors and non-profit worlds come
together to supply cost-effective solutions for those in need.”
Tricia Kaelin, Chief Financial Officer at Safe & Green
Holdings, stated, "During the third quarter, we continued to focus
on leveraging our asset base to secure non-dilutive financing,
which we believe highlights the strength of our balance sheet. In
addition, the Company entered into a new, non-binding, letter of
intent (“LOI”) to sell our Lago Vista site for $11.5 million, the
proceeds of which will be invested as equity in a new joint venture
with a premier real estate development firm. The joint venture
plans to develop the site using SG Echo’s modular units. The Lago
Vista property was initially acquired by the Company in 2021 for
$3.5 million, demonstrating our ability to maximize the value of
our assets. Furthermore, we have reduced operating expenses by more
than $2 million since the first quarter of 2023, which we expect to
realize as savings in 2024.”
Delphine O’Rourke, President & CEO, Safe and Green Medical
Corp. (d/b/a “WELLglobal HealthSM”), commented, “We are making
progress at WELLglobal HealthSM, which is pioneering the
integration of telehealth and traditional in-person healthcare by
offering state-of-the-art pre-constructed modular, eco-friendly
‘WELLness Suite’ to employers, health systems, communities, and
beyond, that can be effortlessly deployed anywhere, anytime. Our
innovative approach is generating strong interest across the
industry, given our ability to ensure the delivery of convenient,
high-quality care for individuals across the nation.”
Mr. Galvin concluded, “We are excited about the numerous
outstanding projects we are currently involved in. Our
manufacturing & construction services revenue has seen
significant growth recently, rising from $4.1 million in 2020 to
over $12.7 million in 2022, and has grown a further 70% in the
first nine months of 2023 alone. The direction we're heading in is
highly promising, and the outlook for Safe & Green Holdings is
brighter than ever. Our business continues to expand, and we remain
committed to prudently managing our expenses to maximize value for
shareholders.”
Financial Results for the Three Months Ended September 30,
2023
Revenue for the third quarter of 2023 was $4.0 million, compared
to $4.1 million for the third quarter of 2022. The decrease was
largely attributable to no medical revenue for the 2023 third
quarter, partially offset by an increase in manufacturing &
construction services revenue. The manufacturing & construction
services segment generated $4.0 million in revenue, a 48% increase,
compared to the same period last year.
Total gross profit (loss) for the third quarter of 2023 was
($536) thousand compared to ($165) thousand in the third quarter of
2022, reflecting the decline in medical revenue.
Operating expenses for the third quarter of 2023 were $2.4
million, compared to $2.3 million for the third quarter of 2022.
The third quarter of 2023 included significant expenses allocated
to the buildout of SG DevCo and Safe and Green Medical Corp
(“WELLglobal HealthSM”) that were not incurred for the same period
last year.
The net loss attributable to common shareholders was
approximately $3.6 million, or $(0.23) per share in the third
quarter of 2023, compared to a net loss of $2.5 million, or $(0.18)
per share, in the third quarter of 2022.
The Company’s Adjusted EBITDA for the third quarter ended
September 30, 2023, was approximately ($1.4) million as compared to
Adjusted EBITDA of approximately ($1.5) million for the third
quarter ended September 30, 2022. Both EBITDA and Adjusted EBITDA
are non-GAAP financial measures. The Company defines EBITDA as GAAP
net income (loss) attributable to common stockholders before
interest expense, income tax benefit (expense), depreciation and
amortization. Adjusted EBITDA is defined as EBITDA before certain
non-recurring, unusual or non-operational items, such as litigation
expense, stock issuance expense and stock compensation expense. The
Company believes that adjusting EBITDA to exclude the effects of
these items that are not closely associated with ongoing corporate
operations provides management and investors with a meaningful
measure that increases period-to-period comparability of the
Company’s operating performance.
The Company believes the presentation of EBITDA and Adjusted
EBITDA is relevant and useful by enhancing the readers’ ability to
understand the Company’s operating performance. The Company’s
management utilizes EBITDA and Adjusted EBITDA as a means to
measure performance.
The Company’s measurements of EBITDA and Adjusted EBITDA may not
be comparable to similar titled measurements reported by other
companies. EBITDA and Adjusted EBITDA are not measurements of
financial performance under GAAP and should not be considered as an
alternative to net income (loss) attributable to common
stockholders or as an indication of operating performance or any
other measures of financial performance derived in accordance with
GAAP. The Company does not consider these non-GAAP measures to be
substitutes for or superior to the information provided by its GAAP
financial results. The non-GAAP information should be read in
conjunction with our consolidated financial statements and related
notes. These measures also should not be construed as an inference
that our future results will be unaffected by the non-recurring,
unusual or non-operational items for which these non-GAAP measures
make adjustments.
The table below reconciles EBITDA and Adjusted EBITDA, both
non-GAAP measures, to GAAP net gain (loss) attributable to common
stockholders of Safe & Green Holdings Corp.
Three Months Ended September
30, 2023
Three Months Ended September
30, 2022
Net loss attributable to common
stockholders of Safe & Green Holdings Corp.
$
(3,608,134
)
$
(2,453,583
)
Addback interest expense
738,649
52,758
Addback interest income
(3,186
)
(9,756
)
Addback depreciation and amortization
1,448,305
145,515
EBITDA (non-GAAP)
(1,424,366
)
(2,265,066
)
Addback litigation expense
—
121,830
Addback stock compensation expense
—
594,694
Adjusted EBITDA (non-GAAP)
$
(1,424,366
)
$
(1,548,542
)
At September 30, 2023, and December 31, 2022, the Company had a
cash balance and short-term investments of $713 thousand and $600
thousand, respectively. As of September 30, 2023, stockholders’
equity was $5.7 million compared to $14.4 million as of September
30, 2022. The Company believes it has sufficient cash and borrowing
capacity to support near-term operations.
The Company’s complete financial results will be available in
the Company’s Form 10-Q, which will be with the Securities and
Exchange Commission and will be available on the Company’s
website.
Conference Call
Safe & Green Holdings will hold its conference call today,
November 14, at 4:30 PM Eastern Time.
Dial-in information:
- Toll-free dial-in number (U.S.): +1 877-545-0320
- International dial-in number: +1 973-528-0002
- Access code: 727552
Live and replay webcast links:
- Direct link:
https://www.webcaster4.com/Webcast/Page/2935/49439
- IR website:
https://ir.safeandgreenholdings.com/news-events/ir-calendar
Telephone replay (available through November 28, 2023):
- Toll-free dial-in number (U.S.): +1 877-481-4010
- International dial-in number: +1 919-882-2331
- Access code 49439
About Safe & Green Holdings Corp.
Safe & Green Holdings Corp., a leading modular solutions
company, operates under core capabilities which include the
development, design, and fabrication of modular structures, meeting
the demand for safe and green solutions across various industries.
The firm supports third-party and in-house developers, architects,
builders, and owners in achieving faster execution, greener
construction, and buildings of higher value. The Company’s
subsidiary, Safe and Green Development Corporation, is a leading
real estate development company. Formed in 2021, it focuses on the
development of sites using purpose-built, prefabricated modules
built from both wood and steel, sourced from one of SG Holdings’
factories and operated by the SG Echo subsidiary. For more
information, visit https://www.safeandgreenholdings.com/ and follow
us at @SGHcorp on Twitter.
Safe Harbor Statement
Certain statements in this press release constitute
"forward-looking statements" within the meaning of the federal
securities laws. Words such as "may," "might," "will," "should,"
"believe," "expect," "anticipate," "estimate," "continue,"
"predict," "forecast," "project," "plan," "intend" or similar
expressions, or statements regarding intent, belief, or current
expectations, are forward-looking statements. These forward-looking
statements are based upon current estimates and assumptions and
include statements regarding anticipated synergies with SG DevCo,
SG DevCo’s project pipeline, expected manufacturing revenue growth
for SG Echo, expected growth among existing as well as new clients,
expanding licensure to California, Georgia, Oregon, and Nevada,
plan to leverage the relationship with CORNERSTONE by providing
cost-effective modular solutions, manufactured by SG Echo, plans to
construct a schoolhouse in Cape Coast, Ghana, as part of the
Ghana’s Tomorrow Project, expectations of becoming cash flow
positive in the first quarter of 2024, and the outlook for Safe
& Green Holdings. These forward-looking statements are subject
to various risks and uncertainties, many of which are difficult to
predict that could cause actual results to differ materially from
current expectations and assumptions from those set forth or
implied by any forward-looking statements. Important factors that
could cause actual results to differ materially from current
expectations include, among others, the Company’s ability to
realize anticipated synergies, the effect of government regulation,
the Company’s ability to maintain compliance with the NASDAQ
listing requirements, and the other factors discussed in the
Company’s Annual Report on Form 10-K for the year ended December
31, 2022 and its subsequent filings with the SEC, including
subsequent periodic reports on Forms 10-Q and 8-K. The information
in this release is provided only as of the date of this release,
and we undertake no obligation to update any forward-looking
statements contained in this release on account of new information,
future events, or otherwise, except as required by law.
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version on businesswire.com: https://www.businesswire.com/news/home/20231114740358/en/
Investor Relations: Crescendo Communications, LLC (212)
671-1020 sgbx@crescendo-ir.com
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