iPower Inc. (Nasdaq: IPW) (“iPower” or the “Company”), a tech and
data-driven online retailer and supplier of consumer home and
garden products, as well as a provider of value-added ecommerce
services, today announced financial results for its fiscal fourth
quarter and full fiscal year ended June 30, 2023.
Fiscal Q4 2023 Results vs. Year-Ago
Quarter
- Total revenue increased 6% to $23.4
million as compared to $22.1 million.
- Gross profit remained flat at $9.1
million, with gross margin of 38.7% as compared to 41.2%.
- Net loss attributable to iPower was
$3.0 million or $(0.10) per share, as compared to net loss of $1.3
million or $(0.05) per share.
- As of June 30, 2023, net debt
(total debt less cash) was reduced by 43% to $8.1 million as
compared to net debt of $14.2 million as of June 30, 2022.
Fiscal 2023 Results vs. Fiscal
2022
- Total revenue increased 12% to
$88.9 million as compared to $79.4 million.
- Gross profit increased 5% to $34.8
million as compared to $33.2 million, with gross margin of 39.1%
compared to 41.8%.
- Net loss attributable to iPower was
$12.0 million or $(0.40) per share, as compared to net income of
$1.5 million or $0.06 per share. The fiscal 2023 period includes
approximately $3 million related to a goodwill impairment incurred
earlier in the fiscal year.
- Cash flow from operations improved
significantly to $9.2 million as compared to cash used of $16.6
million.
Management Commentary
“Fiscal 2023 marked our third consecutive year
of double-digit revenue growth driven by consistent, strong demand
for our in-house products and continued expansion of our
non-hydroponic portfolio,” said Lawrence Tan, CEO of iPower.
“Throughout the fiscal year, we emphasized in-house products sales
which accounted for over 90% of revenue while continuing to
diversify our product offerings beyond hydroponics, which grew to
more than 75% of sales in fiscal 2023. We believe that our ability
to generate double-digit growth while shifting our product mix into
new categories demonstrates our superior product research, design
and merchandising capabilities.”
iPower CFO, Kevin Vassily, added, “During the
year, we continued to work through high-cost inventory buildup from
prior periods, which has weighed on our gross margin in recent
quarters. However, we have now sold through most of the excess
inventory and expect gross margin to improve in fiscal 2024. With
an improved supply chain, normalized inventory levels and continued
demand for our in-house products, we believe that we are well
positioned to execute on our growth and profitability objectives in
fiscal 2024.”
Fiscal Fourth Quarter 2023 Financial
Results
Total revenue in the fiscal fourth quarter of
2023 increased 6% to $23.4 million as compared to $22.1 million for
the same period in fiscal 2022. The increase was primarily driven
by greater product sales to the Company’s largest channel partner,
as well as strong demand for iPower’s non-hydroponic product
portfolio which now accounts for over 75% of revenue.
Gross profit in the fiscal fourth quarter of
2023 remained flat at $9.1 million compared to the same quarter in
fiscal 2022. As a percentage of revenue, gross margin was 38.7% as
compared to 41.2% in the year-ago period. The decrease in gross
margin was primarily driven by a higher cost of goods sold related
to inventory that previously incurred higher freight charges, as
well as normal variations in product and channel mix.
Total operating expenses in the fiscal fourth
quarter of 2023 were $12.0 million as compared to $10.6 million for
the same period in fiscal 2022. The increase was driven in part by
higher selling, fulfillment, and marketing costs related to the
sale of inventory built up in prior quarters.
Net loss attributable to iPower in the fiscal
fourth quarter of 2023 was $3.0 million or $(0.10) per share, as
compared to a net loss of $1.3 million or $(0.05) per share for the
same period in fiscal 2022. The decline was driven in part by the
aforementioned higher operating expenses.
Cash and cash equivalents were $3.7 million at
June 30, 2023, as compared to $1.8 million at June 30, 2022. Total
debt as of June 30, 2023 was $11.8 million as compared to $16.0
million as of June 30, 2022. As a result of the Company’s debt
paydown, iPower’s net debt (total debt less cash) position was
reduced by 43% to $8.1 million as compared to $14.2 million as of
June 30, 2022.
Conference Call
The Company will hold a conference call today,
September 14, 2023, at 4:30 p.m. Eastern Time to discuss the
results for its fiscal fourth quarter and full fiscal year ended
June 30, 2023.
iPower’s management will host the conference
call, which will be followed by a question-and-answer session.
The conference call details are as follows:
Date: Thursday, September 14, 2023Time: 4:30 p.m. Eastern
TimeDial-in registration link: hereLive webcast registration link:
here
Please dial into the conference call 5-10
minutes prior to the start time. If you have any difficulty
connecting with the conference call, please contact the Company’s
investor relations team at IPW@elevate-ir.com.
The conference call will also be broadcast live
and available for replay in the Events & Presentations section
of the Company’s website at www.meetipower.com.
About iPower Inc.
iPower Inc. is a tech and data-driven online
retailer and supplier of consumer home and garden products, as well
as a provider of value-added ecommerce services for third-party
products and brands. iPower offers thousands of stock keeping units
from its in-house brands as well as hundreds of other brands
through its ecommerce channel partners and its websites,
www.zenhydro.com and www.simpledeluxe.com. iPower has a diverse
customer base that includes both commercial businesses and
individuals. For more information, please visit iPower's website at
www.meetipower.com.
Forward-Looking Statements
All statements other than statements of
historical fact in this press release are forward-looking
statements. These forward-looking statements involve known and
unknown risks and uncertainties and are based on current
expectations and projections about future events and financial
trends that iPower believes may affect its financial condition,
results of operations, business strategy, and financial needs.
Investors can identify these forward-looking statements by words or
phrases such as "may," "will," "expect," "anticipate," "aim,"
"estimate," "intend," "plan," "believe," "potential," "continue,"
"is/are likely to" or other similar expressions. iPower undertakes
no obligation to update forward-looking statements to reflect
subsequent events or circumstances, or changes in its expectations,
except as may be required by law. Although iPower believes that the
expectations expressed in these forward-looking statements are
reasonable, it cannot assure you that such expectations will turn
out to be correct, and iPower cautions investors that actual
results may differ materially from the anticipated results and
encourages investors to review other factors that may affect its
future results and performance in iPower's Annual Report on Form
10-K, as filed with the SEC on September 14, 2023, and in its other
SEC filings.
Investor Relations Contact:
Sean Mansouri, CFAElevate IR(720)
330-2829IPW@elevate-ir.com
iPower Inc. and
Subsidiaries |
Consolidated Balance
Sheets |
As of June 30, 2023
and 2022 |
|
|
June 30, |
|
June 30, |
|
2023 |
|
2022 |
|
|
|
|
|
ASSETS |
|
|
|
|
|
Current assets |
|
|
|
|
|
Cash and cash equivalent |
$ |
3,735,642 |
|
|
$ |
1,821,947 |
|
Accounts receivable, net |
|
14,071,543 |
|
|
|
17,432,287 |
|
Inventories, net |
|
20,593,889 |
|
|
|
30,433,766 |
|
Other receivable - related party |
|
- |
|
|
|
51,762 |
|
Prepayments and other current assets |
|
2,858,196 |
|
|
|
5,444,463 |
|
Total current assets |
|
41,259,270 |
|
|
|
55,184,225 |
|
|
|
|
|
|
|
Non-current assets |
|
|
|
|
|
Right of use - non-current |
|
7,837,345 |
|
|
|
10,453,282 |
|
Property and equipment, net |
|
536,418 |
|
|
|
544,633 |
|
Deferred tax assets |
|
2,155,250 |
|
|
|
- |
|
Non-current prepayments |
|
531,456 |
|
|
|
925,624 |
|
Goodwill |
|
3,034,110 |
|
|
|
6,094,144 |
|
Investment in joint venture |
|
33,113 |
|
|
|
43,385 |
|
Intangible assets, net |
|
4,280,071 |
|
|
|
4,929,442 |
|
Other non-current assets |
|
427,254 |
|
|
|
406,732 |
|
Total non-current assets |
|
18,835,017 |
|
|
|
23,397,242 |
|
|
|
|
|
|
|
Total assets |
$ |
60,094,287 |
|
|
$ |
78,581,467 |
|
|
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
|
|
Current liabilities |
|
|
|
|
|
Accounts payable |
|
13,244,957 |
|
|
|
9,533,408 |
|
Credit cards payble |
|
366,781 |
|
|
|
807,687 |
|
Customer deposit |
|
350,595 |
|
|
|
273,457 |
|
Other payables and accrued liabilities |
|
4,831,067 |
|
|
|
5,915,220 |
|
Advance from shareholders |
|
85,200 |
|
|
|
92,246 |
|
Investment payable |
|
- |
|
|
|
1,500,000 |
|
Lease liability - current |
|
2,159,173 |
|
|
|
2,582,933 |
|
Long-term promissory note payable - current portion |
|
2,017,852 |
|
|
|
1,879,065 |
|
Income taxes payable |
|
276,683 |
|
|
|
299,563 |
|
Total current liabilities |
|
23,332,308 |
|
|
|
22,883,579 |
|
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
|
Long-term revolving loan payable, net |
|
9,791,191 |
|
|
|
12,314,627 |
|
Long-term promissory note payable, net |
|
- |
|
|
|
1,781,705 |
|
Deferred tax liabilities |
|
- |
|
|
|
939,115 |
|
Lease liability - non-current |
|
6,106,047 |
|
|
|
8,265,611 |
|
|
|
|
|
|
|
Total non-current liabilities |
|
15,897,238 |
|
|
|
23,301,058 |
|
|
|
|
|
|
|
Total liabilities |
|
39,229,546 |
|
|
|
46,184,637 |
|
|
|
|
|
|
|
Commitments and contingency |
|
- |
|
|
|
- |
|
|
|
|
|
|
|
Stockholders' Equity |
|
|
|
|
|
Preferred stock, $0.001 par value; 20,000,000 shares authorized; 0
shares issued and outstanding at June 30, 2023 and 2022 |
|
- |
|
|
|
- |
|
Common stock, $0.001 par value; 180,000,000 shares authorized;
29,710,939 and 29,572,382 shares issued and outstanding at June 30,
2023 and 2022 |
|
29,712 |
|
|
|
29,573 |
|
Additional paid in capital |
|
29,624,520 |
|
|
|
29,111,863 |
|
(Accumulated deficits) Retained earnings |
|
(8,702,442 |
) |
|
|
3,262,948 |
|
Non-controlling interest |
|
(24,915 |
) |
|
|
(13,232 |
) |
Accumulated other comprehensive income (loss) |
|
(62,134 |
) |
|
|
5,678 |
|
Total equity |
|
20,864,741 |
|
|
|
32,396,830 |
|
|
|
|
|
|
|
Total liabilities and equity |
$ |
60,094,287 |
|
|
$ |
78,581,467 |
|
iPower Inc. and
Subsidiaries |
Consolidated
Statements of Operations |
For the Years Ended
June 30, 2023 and 2022 |
|
|
For the Three Months
Ended June 30, |
|
For the Years Ended
June 30, |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
(Unaudited) |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
REVENUES |
$ |
23,399,166 |
|
|
$ |
22,117,831 |
|
|
$ |
88,902,048 |
|
|
$ |
79,418,473 |
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL REVENUES |
|
23,399,166 |
|
|
|
22,117,831 |
|
|
|
88,902,048 |
|
|
|
79,418,473 |
|
|
|
|
|
|
|
|
|
|
|
|
|
COST OF REVENUES |
|
14,348,668 |
|
|
|
12,998,903 |
|
|
|
54,104,587 |
|
|
|
46,218,580 |
|
|
|
|
|
|
|
|
|
|
|
|
|
GROSS PROFIT |
|
9,050,498 |
|
|
|
9,118,928 |
|
|
|
34,797,461 |
|
|
|
33,199,893 |
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING EXPENSES: |
|
|
|
|
|
|
|
|
|
|
|
Selling and fulfillment |
|
8,133,299 |
|
|
|
6,842,363 |
|
|
|
32,427,972 |
|
|
|
19,180,390 |
|
General and administrative |
|
3,913,672 |
|
|
|
3,767,117 |
|
|
|
12,792,998 |
|
|
|
11,707,466 |
|
Impairment loss - goodwill |
|
- |
|
|
|
- |
|
|
|
3,060,034 |
|
|
|
- |
|
Total operating expenses |
|
12,046,971 |
|
|
|
10,609,480 |
|
|
|
48,281,004 |
|
|
|
30,887,856 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(LOSS) INCOME FROM OPERATIONS |
|
(2,996,473 |
) |
|
|
(1,490,552 |
) |
|
|
(13,483,543 |
) |
|
|
2,312,037 |
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER INCOME (EXPENSE) |
|
|
|
|
|
|
|
|
|
|
|
Interest expenses |
|
(265,497 |
) |
|
|
(231,017 |
) |
|
|
(1,066,280 |
) |
|
|
(458,159 |
) |
Other financing expenses |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(80,010 |
) |
Loss on equity method investment |
|
(1,376 |
) |
|
|
5,673 |
|
|
|
(10,001 |
) |
|
|
(6,616 |
) |
Other non-operating income |
|
(306,874 |
) |
|
|
210,893 |
|
|
|
(107,749 |
) |
|
|
296,366 |
|
Total other expenses, net |
|
(573,747 |
) |
|
|
(14,451 |
) |
|
|
(1,184,030 |
) |
|
|
(248,419 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
(LOSS) INCOME BEFORE INCOME TAXES |
|
(3,570,220 |
) |
|
|
(1,505,003 |
) |
|
|
(14,667,573 |
) |
|
|
2,063,618 |
|
|
|
|
|
|
|
|
|
|
|
|
|
PROVISION FOR INCOME TAX (BENEFIT) EXPENSE |
|
(605,374 |
) |
|
|
(146,570 |
) |
|
|
(2,690,500 |
) |
|
|
558,975 |
|
NET (LOSS) INCOME |
|
(2,964,846 |
) |
|
|
(1,358,433 |
) |
|
|
(11,977,073 |
) |
|
|
1,504,643 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-controlling interest |
|
(2,805 |
) |
|
|
(9,162 |
) |
|
|
(11,683 |
) |
|
|
(13,232 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
NET (LOSS) INCOME ATTRIBUTABLE TO IPOWER INC. |
$ |
(2,962,041 |
) |
|
$ |
(1,349,271 |
) |
|
$ |
(11,965,390 |
) |
|
$ |
1,517,875 |
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER COMPREHENSIVE LOSS |
|
|
|
|
|
|
|
|
|
|
|
Foreign currency translation adjustments |
|
(21,090 |
) |
|
|
8,904 |
|
|
|
(67,812 |
) |
|
|
5,678 |
|
|
|
|
|
|
|
|
|
|
|
|
|
COMPREHENSIVE (LOSS) INCOME ATTRIBUTABLE TO IPOWER INC. |
$ |
(2,983,131 |
) |
|
$ |
(1,340,367 |
) |
|
$ |
(12,033,202 |
) |
|
$ |
1,523,553 |
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE NUMBER OF COMMON STOCK |
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
29,747,497 |
|
|
|
29,662,448 |
|
|
|
29,713,354 |
|
|
|
27,781,493 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
29,747,497 |
|
|
|
29,662,448 |
|
|
|
29,713,354 |
|
|
|
27,781,493 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(LOSSES) EARNINGS PER SHARE |
|
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
(0.100 |
) |
|
$ |
(0.045 |
) |
|
$ |
(0.403 |
) |
|
$ |
0.055 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
$ |
(0.100 |
) |
|
$ |
(0.045 |
) |
|
$ |
(0.403 |
) |
|
$ |
0.055 |
|
iPower (NASDAQ:IPW)
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