Q1 2024 Revenue Increases 60% YoY to
$30.2 Million
Q1 2024 Net Income Increases 480% YoY to
$3.2 Million
New In-Store Agreements with Leading Global
Retailers for Motor Vehicles
Increased Massimo Motor Production Capacity to
3,000+ Vehicles a Month
GARLAND,
Texas, May 14, 2024 /PRNewswire/
-- Massimo Group (NASDAQ: MAMO) ("Massimo"), a
manufacturer and distributor of powersports vehicles and pontoon
boats, has reported its financial and operational results for the
first quarter ended March 31,
2024.
Key Financial Q1 2024 and Subsequent Operational Highlights
and Business Updates
($
millions)
|
|
Q1
Comparison
|
|
|
Q1 2024
|
Q1 2023
|
$ Change YoY
|
% Change YoY
|
Revenue
|
|
$30.2
|
$18.8
|
$11.3
|
60 %
|
Gross Profit
|
|
$10.5
|
$5.6
|
$4.8
|
86 %
|
Gross Margin
|
|
34.7 %
|
29.8 %
|
--
|
500
bps
|
Net Income
|
|
$3.2
|
$0.5
|
$2.6
|
480 %
|
- Closed $5.85 million IPO listing
on Nasdaq Capital Market under the ticker symbol "MAMO" on
April 4, 2024.
- Revenue increased 60% to $30.2
million in Q1 2024 compared to $18.8
million in Q1 2023.
- Gross profit increased 86% to $10.5
million in Q1 2024 from $5.6
million in Q1 2023. Gross margin increased 500 basis points
to 34.7% in Q1 2024 from 29.8% in Q1 2023.
- Net income increased 480% to $3.2
million in Q1 2024, or $0.08
per basic and diluted share, as compared to net income of
$0.5 million, or $0.01 per basic and diluted share, in Q1
2023.
- Entered into an ongoing national agreement with a global
omnichannel retailer for its youth series Mini Tractor and Mini 125
Go Karts to be sold in stores.
- Entered into an ongoing agreement with Fleet Farm, a retailer
serving active, outdoor, suburban and farm communities in the
Midwest U.S., for its UTV, ATV, and youth series product lines to
be sold in stores.
- Increased production capacity to 3,000+ vehicles each month, a
significant jump from previous output levels
- Added two new models to its 2024 ATV lineup, the Massimo MSA
600 and MSA 1000 ATVs, providing customers with new options for
work or on the trail.
- Unveiled new 2024 1000 UTV, with a powerful 83hp EFI engine
that allows for an efficient workday while leaving plenty of room
for thrills on the weekends.
- Showcased a range of vehicles at the 2024 Tractor Supply
Company Annual Sales Meeting, annual Thiesen's Home and Farm Show,
and 40th Annual Equip Expo.
Management Commentary
"The first quarter of 2024 was highlighted by our successful IPO
and Nasdaq listing, along with substantial top and bottom line
growth on strong sales and margin improvement for our diversified
and comprehensive product portfolio," said David Shan, Founder, Chairman & CEO. "Our
production crew is able to produce 3,000+ vehicles each month, a
significant jump from previous output levels. This surge in
manufacturing is expected to allow Massimo to meet growing demand
while paving the way for exciting new developments.
"Two new recent partnership agreements highlighted our in-store
distribution channel expansion efforts with major retailers. We
signed an ongoing national agreement with a global omnichannel
retailer for the youth series Mini Tractor and Mini 125 Go Kart to
be sold in stores. The retailer's online marketplace currently
features over 100 Massimo products, and with the expanded
partnership, the two products will now be eligible to be stocked at
over 1,300 stores in 13 states beginning in May. The addition of
this first national in-store opportunity with this global retailer
represents a significant milestone for our company, and we are well
positioned to accelerate robust sales growth with the retailer. We
believe with successful sales we can continue to add vehicles to
the in-store program.
"We also entered into an ongoing agreement with Fleet Farm for
six UTV, ATV, and youth series products to be sold in stores and
featured on the retailer's online marketplace.
"Our focus on distribution channel expansion has resulted in
over 2,800 retail locations promoting our brand in 48 states where
our products are distributed and will continue to drive sales
across our full motor product line of Massimo vehicles.
"Looking ahead, with increased participation in outdoor
activities and higher utilization of utility vehicles in ranch and
farm-work, demand for UTVs and ATVs in the U.S, we believe we are
well positioned for continued market penetration in this
high-growth category with our full suite of consumer motor
products. We believe with increased operating efficiencies we can
further enhance margins while continuing to grow our revenue and
expand our product line with new models and capabilities,"
concluded Mr. Shan.
First Quarter 2024 Financial Results
For the three months ended March 31,
2024, revenues increased by $11.3
million, or 60.0%, to $30.2
million, compared to $18.8
million in the prior year period. The first quarter increase
in revenue was principally due to our expansion at major chain
stores and our dealer network.
Revenue from sales of UTVs, ATVs and electric bikes increased by
$12.2 million, or 74.1%, from
$16.5 million in the three months
ended March 31, 2023 to $28.7 million in the three months ended
March 31, 2024. The increase in
revenue was attributable to the expansion into more large retail
stores in the US and to a shift in our sales strategy, focusing
mostly on in-store sales, which generally involve larger volumes
and fewer returns.
Revenue from sales of pontoon boats decreased by $0.9 million, or 38.2%, from $2.4 million in the three months ended
March 31, 2023 to $1.5 million in the three months ended
March 31, 2024. The decrease in
revenue was primarily attributable to the fact that we shifted from
retailing in Q1 2023 to dealer sales in Q1 2024 and the dealers
have experienced more difficulty amid the current high interest
rate environment obtaining floorplan financing for customers from
providers such as Northpoint. This is consistent with industry-wide
trends.
Gross profit increased by $4.8
million, or 86.1%, from $5.6
million in the three months ended March 31, 2023 to $10.5
million in the three months ended March 31, 2024. Gross profit margin was 34.7% in
the three months ended March 31,
2024, as compared with 29.8% in the prior year quarter. The
increase in the gross profit margin was primarily attributable to
higher net sales partly due to decreased returns, as well as the
lower cost of sales due to reduced freight costs in the first
quarter of 2024 as compared to the previous year.
Cost of revenue on UTVs, ATVs and electric bikes increased by
$7.2 million, or 63.7%, from
$11.3 million in the three months
ended March 31, 2023 to $18.5 million in the three months ended
March 31, 2024 and gross profit
increased by $5.0 million, or 96.7%,
from $5.2 million in three months
ended March 31, 2023 to $10.2 million in three months ended March 31, 2024. Gross profit margin increased by
4.1%, from 31.6% in the three months ended March 31, 2023 to 35.7% in the three months ended
March 31, 2024. The increased cost of
revenue was in line with the increase in sales. The increase in
gross profit margin was mainly due to a significant decline in
global container freight when compared with last year.
Cost of revenue on pontoon boats decreased by $0.7 million, or 36.4%, from $1.9 million from the three months ended
March 31, 2023 to $1.2 million in the three months ended
March 31, 2024, and gross profit
decreased by $0.2 million, or 46.7%,
from $0.4 million in the three months
ended March 31, 2023 to $0.2 million in the three months ended
March 31, 2024. Gross profit margin
decreased by 2.4%, from 17.6% in the three months ended
March 31, 2023 to 15.2% in the three
months ended March 31, 2024.
Selling and marketing expenses increased by $0.3 million, or 13.3%, from $2.0 million in the three months ended
March 31, 2023 to $2.2 million in the three months ended
March 31, 2024. This is consistent
with the fact that the chargebacks from new big box customer have
been increased as a result of increased sales.
General and administrative expenses increased by $1.1 million, or 37.2%, from $3.0 million in the three months ended
March 31, 2023 to $4.1 million in the three months ended
March 31, 2024. The increase was
mainly due to increased rent expense and professional fees.
Total operating expenses increased 31.1% to $6.5 million for the three months ended
March 31, 2024, compared to
$4.9 million in the prior year first
quarter.
Net income for the three months ended March 31, 2024, was $3.2
million, or $0.08 per basic
and diluted share, as compared to net income of $0.5 million, or $0.01 per basic and diluted share, in the three
months ended March 31, 2023.
Cash and cash equivalents totaled $0.2
million at March 31, 2024, as
compared to $0.8 million at
December 31, 2023. On April 24, 2024, Massimo closed its initial public
offering with aggregate gross proceeds, before deducting
underwriting discounts and commissions and other offering expenses
payable by Massimo, of $5.85
million.
Net cash used by operating activities was $0.6 million for the three months ended
March 31, 2024, compared to cash
provided of $0.8 million in the three
months ended March 31, 2023,
primarily due to increases in accounts receivable and
inventory.
About Massimo Group
Massimo Group (NASDAQ: MAMO) is a manufacturer and distributor
of powersports vehicles and pontoon boats. Founded in 2009, Massimo
Motor believes it offers some of the most value packed UTV's,
off-road, and on-road vehicles in the industry. The company's
product lines include a wide selection of farm and ranch tested
utility UTVs, recreational ATVs, and Americana style mini-bikes.
Massimo Marine manufacturers and
sells Pontoon and Tritoon boats with a dedication to innovative
design, quality craftsmanship, and great customer service. Massimo
is also developing electric versions of UTVs, golf-carts and
pontoon boats. The company's 286,000 square foot factory is in the
heart of the Dallas / Fort Worth
area of Texas in the city of
Garland. For more information,
visit massimomotor.com, massimomarine.com and
www.massimoelectric.com.
Forward-Looking Statements
This press release contains statements that constitute
"forward-looking statements," including with respect to the initial
public offering and the use of proceeds thereof. In some cases, you
can identify forward-looking statements because they contain words
such as "anticipate," "believe," "estimate," "expect," "intend,"
"may," "predict," "project," "target," "potential," "seek," "will,"
"would," "could," "should," "continue," "contemplate," "plan," and
other words and terms of similar meaning. These forward-looking
statements include information concerning statements regarding
future cash needs, future operations, business plans and future
financial results; and any other statements that are not historical
facts. No assurance can be given that the proceeds of the offering
will be used as indicated. Forward-looking statements are subject
to numerous conditions, many of which are beyond the control of
Massimo, including those set forth in the "Risk Factors" section of
Massimo's annual report on Form 10-K for the for the fiscal year
ended December 31, 2023 filed with
the SEC. Copies are available on the SEC's website, www.sec.gov.
Massimo undertakes no obligation to update these statements for
revisions or changes after the date of this release, except as
required by law.
Company
Dr. Yunhao
Chen
Chief Financial Officer
Massimo Group
ir@massimomotor.com
Investor Relations
Chris Tyson
Executive Vice President
MZ North America
Direct: 949-491-8235
MAMO@mzgroup.us
MASSIMO GROUP AND
SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
|
|
|
|
March 31,
2023
(unaudited)
|
|
|
December 31, 2023
(audited)
|
|
|
As of
|
|
|
March 31,
2024
(unaudited)
|
|
|
December 31, 2023
(audited)
|
ASSETS
|
|
|
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
207,137
|
|
|
$
|
765,814
|
Accounts receivable,
net
|
|
|
14,203,770
|
|
|
|
9,566,445
|
Inventories,
net
|
|
|
27,182,635
|
|
|
|
25,800,912
|
Advance to
suppliers
|
|
|
1,406,100
|
|
|
|
1,589,328
|
Other current
assets
|
|
|
679,319
|
|
|
|
637,509
|
Total current
assets
|
|
|
43,678,961
|
|
|
|
38,360,008
|
|
|
|
|
|
|
|
|
NON-CURRENT
ASSETS
|
|
|
|
|
|
|
|
Property and equipment
at cost, net
|
|
|
384,551
|
|
|
|
399,981
|
Right of use operating
lease assets, net
|
|
|
1,197,431
|
|
|
|
1,478,221
|
Right of use financing
lease assets, net
|
|
|
103,169
|
|
|
|
113,549
|
Deferred offering
assets
|
|
|
1,563,547
|
|
|
|
1,457,119
|
Deferred tax
assets
|
|
|
346,948
|
|
|
|
134,601
|
Total non-current
assets
|
|
|
3,595,646
|
|
|
|
3,583,471
|
TOTAL
ASSETS
|
|
$
|
47,274,607
|
|
|
$
|
41,943,479
|
|
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
|
|
|
Short-term
loans
|
|
$
|
-
|
|
|
$
|
303,583
|
Accounts
payable
|
|
|
14,772,382
|
|
|
|
12,678,077
|
Other payable, accrued
expenses and other current liabilities
|
|
|
90,463
|
|
|
|
98,097
|
Accrued return
liabilities
|
|
|
138,229
|
|
|
|
283,276
|
Accrued warranty
liabilities
|
|
|
640,525
|
|
|
|
619,113
|
Contract
liabilities
|
|
|
1,052,342
|
|
|
|
1,835,411
|
Current portion of
obligations under operating leases
|
|
|
681,872
|
|
|
|
847,368
|
Current portion of
obligations under financing leases
|
|
|
42,083
|
|
|
|
41,647
|
Income tax
payable
|
|
|
3,221,201
|
|
|
|
2,121,083
|
Total current
liabilities
|
|
|
20,639,097
|
|
|
|
18,827,655
|
|
|
|
|
|
|
|
|
NON-CURRENT
LIABILITIES
|
|
|
|
|
|
|
|
Obligations under
operating leases, non-current
|
|
|
515,559
|
|
|
|
630,853
|
Obligations under
financing leases, non-current
|
|
|
66,338
|
|
|
|
77,024
|
Loan from a
shareholder
|
|
|
7,909,525
|
|
|
|
7,920,141
|
Total non-current
liabilities
|
|
|
8,491,422
|
|
|
|
8,628,018
|
TOTAL
LIABILITIES
|
|
$
|
29,130,519
|
|
|
$
|
27,455,673
|
|
|
|
|
|
|
|
|
Commitments and
Contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
|
|
|
Common shares, $0.001
par value, 100,000,000 shares authorized,
40,000,000 and 40,000,000 issued and outstanding as of March
31,
2024 and December 31, 2023, respectively
|
|
|
40,000
|
|
|
|
40,000
|
Preferred shares, $0.01
par value, 5,000,000 preferred shares
authorized, no shares were issued and outstanding as of March
31,
2024 and December 31, 2023, respectively
|
|
|
-
|
|
|
|
-
|
Subscription
receivable
|
|
|
(357,159)
|
|
|
|
(832,159)
|
Additional
paid-in-capital
|
|
|
1,994,000
|
|
|
|
1,994,000
|
Retained
earnings
|
|
|
16,467,247
|
|
|
|
13,285,965
|
Total
equity
|
|
|
18,144,088
|
|
|
|
14,487,806
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES
AND EQUITY
|
|
$
|
47,274,607
|
|
|
$
|
41,943,479
|
MASSIMO GROUP AND
SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE
INCOME
|
|
|
|
2024
|
|
|
2023
|
|
|
For the Three Months
Ended
March
31,
|
|
|
2024
|
|
|
2023
|
|
|
|
|
|
|
Revenues
|
|
$
|
30,151,677
|
|
|
$
|
18,840,415
|
Cost of
revenues
|
|
|
19,700,290
|
|
|
|
13,223,421
|
Gross
Profit
|
|
|
10,451,387
|
|
|
|
5,616,994
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Selling and marketing
expenses
|
|
|
2,210,484
|
|
|
|
1,950,285
|
General and
administrative expenses
|
|
|
4,106,905
|
|
|
|
2,984,262
|
Research and
development expenses
|
|
|
162,250
|
|
|
|
-
|
Total operating
expenses
|
|
|
6,479,639
|
|
|
|
4,934,547
|
|
|
|
|
|
|
|
|
Income from
operations
|
|
|
3,971,748
|
|
|
|
682,447
|
|
|
|
|
|
|
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
Other income,
net
|
|
|
247,569
|
|
|
|
44,895
|
Interest
expense
|
|
|
(137,694)
|
|
|
|
(155,098)
|
Total other income
(expense), net
|
|
|
109,875
|
|
|
|
(110,203)
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
|
|
4,081,623
|
|
|
|
572,244
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
|
|
900,341
|
|
|
|
24,079
|
|
|
|
|
|
|
|
|
Net income and
comprehensive income
|
|
$
|
3,181,282
|
|
|
$
|
548,165
|
|
|
|
|
|
|
|
|
Earnings per share –
basic and diluted
|
|
$
|
0.08
|
|
|
$
|
0.01
|
Weighted average number
of shares of common stock outstanding –
basic and diluted
|
|
|
40,000,000
|
|
|
|
40,000,000
|
MASSIMO GROUP AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
2024
|
|
|
2023
|
|
|
Three Months Ended
March 31,
|
|
|
2024
|
|
|
2023
|
|
|
|
|
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
Net income
|
|
$
|
3,181,282
|
|
|
$
|
548,165
|
Adjustments to
reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
Depreciation
|
|
|
36,511
|
|
|
|
35,300
|
Non-cash operating
lease expense
|
|
|
280,790
|
|
|
|
184,316
|
Accretion of finance
lease liabilities
|
|
|
1,331
|
|
|
|
1,784
|
Amortization of finance
lease right-of-use assets
|
|
|
10,380
|
|
|
|
9,343
|
Gain on disposal of
fixed asset
|
|
|
(44,655)
|
|
|
|
-
|
Provision for expected
credit loss, net
|
|
|
234,298
|
|
|
|
104,631
|
Deferred tax
assets
|
|
|
(212,347)
|
|
|
|
-
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
(4,871,623)
|
|
|
|
93,993
|
Inventories
|
|
|
(1,381,723)
|
|
|
|
(672,300)
|
Advance to
suppliers
|
|
|
183,228
|
|
|
|
1,423,742
|
Other current
asset
|
|
|
(41,810)
|
|
|
|
(302,580)
|
Accounts
payables
|
|
|
2,094,305
|
|
|
|
(525,990)
|
Other payable, accrued
expense and other current liabilities
|
|
|
(7,634)
|
|
|
|
(33,401)
|
Tax payable
|
|
|
1,100,118
|
|
|
|
24,079
|
Accrued warranty
liabilities
|
|
|
21,412
|
|
|
|
(37,558)
|
Accrued return
liabilities
|
|
|
(145,047)
|
|
|
|
(292,483)
|
Contract
liabilities
|
|
|
(783,069)
|
|
|
|
403,760
|
Due to
shareholder
|
|
|
(10,616)
|
|
|
|
(20,273)
|
Lease liabilities –
operating lease
|
|
|
(280,790)
|
|
|
|
(184,316)
|
Net cash (used in)
provided by operating activities
|
|
|
(635,659)
|
|
|
|
760,212
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
Proceed from sales of
property and equipment
|
|
|
128,001
|
|
|
|
-
|
Acquisition of property
and equipment
|
|
|
(104,427)
|
|
|
|
-
|
Net cash provided by
investing activities
|
|
|
23,574
|
|
|
|
-
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
Proceeds from bank
loan
|
|
|
-
|
|
|
|
300,000
|
Repayment of bank
loan
|
|
|
-
|
|
|
|
(900,000)
|
Repayment of other
loans
|
|
|
(303,583)
|
|
|
|
-
|
Repayment of finance
lease liabilities
|
|
|
(11,581)
|
|
|
|
(10,536)
|
Repayment to related
party
|
|
|
-
|
|
|
|
(10,000)
|
Deferred offering
costs
|
|
|
(106,428)
|
|
|
|
(75,000)
|
Proceeds from
subscription deposits
|
|
|
475,000
|
|
|
|
-
|
Net cash provided by
(used in) financing activities
|
|
|
53,408
|
|
|
|
(695,536)
|
|
|
|
|
|
|
|
|
Net (decrease) increase
in cash and cash equivalents
|
|
|
(558,677)
|
|
|
|
64,676
|
Cash and cash
equivalents, beginning of the period
|
|
|
765,814
|
|
|
|
947,971
|
Cash and cash
equivalents, end of the period
|
|
$
|
207,137
|
|
|
$
|
1,012,647
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL
DISCLOSURES OF CASH FLOW
INFORMATION:
|
|
|
|
|
|
|
|
Cash paid for
interest
|
|
$
|
137,694
|
|
|
$
|
155,098
|
Cash paid for income
taxes
|
|
$
|
12,570
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
NON-CASH
ACTIVITIES
|
|
|
|
|
|
|
|
Right of use assets
obtained in exchange for operating lease
obligations
|
|
$
|
-
|
|
|
$
|
-
|
Right of use assets
obtained in exchange for finance lease
|
|
$
|
-
|
|
|
$
|
37,430
|
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multimedia:https://www.prnewswire.com/news-releases/massimo-group-reports-first-quarter-2024-financial-results-302144092.html
SOURCE Massimo Group