Third Quarter 2022 Revenue Increased 89% to
$13.2 Million Representing 15th Consecutive Quarter of
Year-Over-Year Revenue Growth
Received $20.5 Million in New Purchase Orders
During Third Quarter with Customer Order Backlog at Record $38.6
Million
Strategic Initiatives Drive Increased Backlog
Conversion, Higher Inventory Turns & Improved Gross Margins
Resulting in Progress to Profitability
Management to Host Conference Call Today at
4:30 p.m. Eastern Time
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 third quarter ended March
31, 2022.
Key Financial & Operational Highlights for the Third
Quarter Fiscal Year 2022
- Revenue increased 89% to $13.2 million in Q3’22 compared to
Q3’21 revenue of $7.0 million.
- Achieved 15th consecutive quarter of year-over-year revenue
growth.
- Received $20.5 million in customer purchase orders for
deliveries in coming months from both existing and new
customers.
- Customer order backlog increased to $38.6 million as of March
31, 2022.
- Introduced three new products in March 2022 at MODEX material
handling trade show:
- L36 lithium-ion battery pack, a 36-volt option for 3-wheel
forklifts;
- C48 lithium-ion battery pack for Automated Guided Vehicles
(AGV) and Autonomous Mobile Robots (AMR); and
- S24 lithium-ion battery pack providing twice the capacity
(210Ah) for Walkie Pallet Jacks for heavy duty applications
- Appointed Cheemin Bo-Linn, a global technology industry
veteran, to the Board of Directors as an independent director, as a
member of the Audit Committee, Compensation Committee, and as Chair
of the Nominating and Governance Committee. Ms. Bo-Linn’s
appointment as an independent director increases the total number
of board members to five, with three independent directors.
- Implementing Strategic Supply Chain & Profitability
Improvement Initiatives to accelerate the path to cash flow
breakeven, including:
- Identifying more competitive carriers to reduce shipping
costs;
- Utilizing lower cost steel suppliers that meet required
specifications;
- Improving manufacturing capacity and production processes
(including implementing Lean Manufacturing) to increase throughput,
reduce the time to fulfill customer orders and improve gross
margins;
- Increasing inventory turns from 2.0x to 2.5x during the
quarter;
- Introducing new product designs to lower costs, simplify part
count and cost, and improve serviceability;
- Expanded customer base, particularly among Fortune 500
companies.
CEO Commentary
“The third quarter of fiscal year 2022 produced a record revenue
of $13.2 million for the Company, continuing our 15th consecutive
quarter of year-over-year revenue growth,” said Ron Dutt, Chief
Executive Officer of Flux Power.
“Ongoing customer demand produced $20.5 million in purchase
orders received from new and existing customers. We are highly
focused on the timely shipment of our record backlog of $38.6
million as of March 31, 2022, which has been helped by improvement
in sourcing actions to mitigate part shortages and to increase
confidence in future supplier performance. Beyond our current
backlog, we received a non-binding multi-year LOI (letter of
intent) in the third quarter from one of our Fortune 100 customers;
they want to preserve build slots as part on their ongoing fleet
conversion to lithium.
“During the third quarter, we introduced new product designs to
respond to customer requests. Some of the improvements included
higher capacities for extra-long and demanding shifts, easier
servicing, lower total cost of ownership, and other features to
solve a variety of existing performance challenges of customer
operations. We continue to introduce new product designs for margin
enhancement, part commonality and improved serviceability.
“With ongoing global supply chain disruptions, we have been
improving production process improvements and better supply chain
management. We are now working to leverage increased pack volumes
to re-source steel and board components to low cost regions and to
high volume local suppliers; and also identify more competitive
carriers to reduce shipping costs. We plan to ship backlog and
reduce inventory levels; as of the end of the third quarter,
inventory levels had not yet decreased materially, but we
anticipate reductions in the current quarter as we get traction on
our plan.
“Looking ahead, we continue to focus on expanding sales of our
energy storage solutions to new and existing customers who want the
benefits of lithium-ion technology. We continue to see customer
interest in our SkyBMS Telematics product for remote fleet
management and monitoring.
“Combined with our strong purchase orders, record backlog and
improving margins, we believe our growth trajectory in 2022 is on
track for another record revenue year despite supply chain
disruptions. I look forward to providing additional updates in the
months to come,” stated Dutt.
Third Quarter Fiscal Year 2022 Financial Results
- Revenue for the fiscal third quarter of 2022 increased by 89%
to $13.2 million compared to $7.0 million in the fiscal third
quarter of 2021, driven by increased sales volumes and models with
higher selling prices.
- Gross profit for the fiscal third quarter of 2022 increased to
$1.9 million compared to a gross profit of $1.7 million in the
fiscal third quarter of 2021. Gross margin was 14.6% in the fiscal
third quarter of 2022 as compared to 24.1% in the fiscal third
quarter of 2021, impacted by higher costs for steel, electronic
parts, and common off the shelf parts during the quarter, not yet
offset by pricing increases which were implemented after commitment
to quotes and orders.
- Selling & Administrative expenses increased to $3.9 million
in the fiscal third quarter of 2022 from $3.1 million in the fiscal
third quarter of 2021, reflecting increases in outbound shipping
costs, personnel expenses related to new hires and temporary labor,
and an increase in insurance premiums.
- Research & Development expenses increased to $1.7 million
in the fiscal third quarter of 2022, compared to $1.5 million in
the fiscal third quarter of 2021, primarily due to expenses related
to development of new models and UL certifications.
- Net loss for the fiscal third quarter of 2022 increased to $3.7
million from a net loss of $1.7 million in the fiscal third quarter
of 2021, principally reflecting increased operating expenses,
partially offset by an increase in gross profit.
- Cash was $3.8 million at March 31, 2022, as compared to $4.7
million at June 30, 2021. Our working capital line of credit
outstanding balance was $3.5 million at March 31, 2022. Cash
requirements during the quarter were higher due to the pre-purchase
of inventory to support increasing sales orders.
Financial Management Commentary
“Customer demand was strong during the fiscal third quarter,
reflected in our record revenue which increased by $5.5 million
from the second fiscal quarter. Our strategic supply chain and
profitability improvement initiatives, including an expanded second
shift and implementing lean manufacturing processes, have resulted
in greater throughput with inventory turns improving from 2.0x to
2.5x as we monetize our backlog, while keeping inventory levels
relatively flat.
“We are implementing these initiatives to reduce our cash burn
and improve gross margins, all serving to offset any continuation
in supply chain disruption. An additional positive development
includes a $4 million signed commitment on our $5 million credit
facility agreement of May 11, 2022. We believe these developments
are instrumental in achieving our near-term goal of profitability.”
concluded Dutt.
Third Quarter Fiscal Year 2022 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, May 12, 2022
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:
13728937
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=1542868&tp_key=96dad790ed
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 on May 12, 2022, through August 12, 2022.
Toll-free replay number:
1-844-512-2921
International replay number:
1-412-317-6671
Replay ID:
13728937
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, deferral of shipments,
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 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.
CONDENSED CONSOLIDATED BALANCE
SHEETS
March 31, 2022
June 30, 2021
(Unaudited)
ASSETS
Current assets:
Cash
$
3,804,000
$
4,713,000
Accounts receivable
9,508,000
6,097,000
Inventories, net
20,934,000
10,513,000
Other current assets
577,000
417,000
Total current assets
34,823,000
21,740,000
Right of use asset
2,711,000
3,035,000
Property, plant and equipment, net
1,588,000
1,356,000
Other assets
89,000
131,000
Total assets
$
39,211,000
$
26,262,000
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Accounts payable
$
13,361,000
$
7,175,000
Accrued expenses
2,142,000
2,583,000
Line of credit
3,500,000
-
Deferred revenue
313,000
24,000
Customer deposits
690,000
171,000
Office lease payable, current portion
486,000
435,000
Accrued interest
2,000
2,000
Total current liabilities
20,494,000
10,390,000
Office lease payable, less current
portion
2,493,000
2,866,000
Total liabilities
22,987,000
13,256,000
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; 15,992,080 and 13,652,164 shares issued and
outstanding at March 31, 2022 and June 30, 2021, respectively
16,000
14,000
Additional paid-in capital
95,369,000
79,197,000
Accumulated deficit
(79,161,000
)
(66,205,000
)
Total stockholders’ equity
16,224,000
13,006,000
Total liabilities and stockholders’
equity
$
39,211,000
$
26,262,000
FLUX POWER HOLDINGS,
INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended
March 31,
Nine Months Ended
March 31,
2022
2021
2022
2021
Revenues
$
13,177,000
$
6,964,000
$
27,138,000
$
17,932,000
Cost of sales
11,257,000
5,287,000
22,838,000
13,893,000
Gross profit
1,920,000
1,677,000
4,300,000
4,039,000
Operating expenses:
Selling and administrative
3,904,000
3,122,000
11,402,000
9,177,000
Research and development
1,713,000
1,523,000
5,768,000
4,624,000
Total operating expenses
5,617,000
4,645,000
17,170,000
13,801,000
Operating loss
(3,697,000
)
(2,968,000
)
(12,870,000
)
(9,762,000
)
Other income (expense):
Other income
-
1,307,000
-
1,307,000
Interest expense
(52,000
)
(64,000
)
(86,000
)
(618,000
)
Net loss
$
(3,749,000
)
$
(1,725,000
)
$
(12,956,000
)
$
(9,073,000
)
Net loss per share - basic and diluted
$
(0.23
)
$
(0.14
)
$
(0.85
)
$
(0.80
)
Weighted average number of common shares
outstanding - basic and diluted
15,988,926
12,499,870
15,254,983
11,300,229
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220512005909/en/
Media & Investor Relations: Justin Forbes 877-505-3589
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
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