FORD Forward Industries Inc

Forward Industries, Inc. (NASDAQ:FORD), a single source solution provider for the full spectrum of hardware and software product design and engineering services as well as a designer and distributor of carry and protective solutions, today announced financial results for its second quarter ended March 31, 2022.

Second Quarter Fiscal 2022 Financial Highlights

• Revenues were $10.3 million, an increase of 22.6% from $8.4 million for the three months ended March 31, 2021.
• Gross margin improved to 21.8% compared to 20.8% for the three months ended March 31, 2021.
• Operating loss was $0.3 million compared to $0.8 million for the three months ended March 31, 2021.
• Net loss was $0.4 million compared to $0.8 million for the three months ended March 31, 2021.
• Basic and diluted loss per share was $0.04 compared to $0.08 for the three months ended March 31, 2021.
• Cash balance of $1.5 million at March 31, 2022 as compared to $1.4 million at September 30, 2021.

Terry Wise, Chief Executive Officer of Forward Industries, stated “I am overall pleased with our improved Q2 2022 fiscal year results. The resilient performance of the business is largely due to continued strong results within our design division, principally IPS. This has helped offset the ongoing logistical difficulties within retail and we are proactively seeking solutions to mitigate these challenges. Finally, the OEM distribution sector remains as per expectations, and we continue to focus our resources away from the declining diabetic sector.   Based on our second quarter performance, and our internal proactive efforts, I continue to remain cautiously optimistic for the remainder fiscal year.”

The tables below are derived from the Company’s consolidated financial statements included in its Form 10-Q filed on May 12, 2022 with the Securities and Exchange Commission. Please refer to the Form 10-Q for complete financial statements and further information regarding the Company’s results of operations and financial condition relating to the fiscal quarters ended March 31, 2022 and 2021. Please also refer to the Company’s Form 10-K for a discussion of risk factors applicable to the Company and its business. 

Cautionary Note Regarding Forward-Looking Statements

This press release contains certain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 including statements regarding our pipeline of work and projects, growth in sales for our retail business, seeking solutions to mitigate logistical difficulties and growth in our design division. Forward has tried to identify these forward-looking statements by using words such as “may”, “should,” “expect,” “hope,” “anticipate,” “believe,” “intend,” “plan,” “estimate” and similar expressions. These forward-looking statements are based on information currently available to the Company and are subject to a number of risks, uncertainties and other factors that could cause its actual results, performance, prospects or opportunities to differ materially from those expressed in, or implied by, these forward-looking statements. These risks include the inability to expand our customer base, pricing pressures, lack of success of our sales people, failure to develop products at a profit, failure to commercialize products that we develop, continued supply chain issues, inability of our design division’s customers to pay for our services, unanticipated issues with our affiliated sourcing agent, issues at Chinese factories that we source our products as a result of the pandemic or otherwise, and failure to obtain acceptance of our products by big box retail stores. No assurance can be given that the actual results will be consistent with the forward-looking statements. Investors should read carefully the factors described in the “Risk Factors” section of the Company’s filings with the SEC, including the Company’s Form 10-K for the year ended September 30, 2021 for information regarding risk factors that could affect the Company’s results. Except as otherwise required by Federal securities laws, Forward undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason.

About Forward Industries

Forward is a fully integrated design, development and manufacturing solution provider to top tier medical and technology customers worldwide. Through its acquisitions of Intelligent Product Solutions, Inc. and Kablooe Design, Inc., the Company has expanded its ability to design and develop solutions for its existing multinational client base and expand beyond the diabetic product line into a variety of industries with a full spectrum of hardware and software product design and engineering services. In addition to our existing design and distribution of carry and protective solutions, primarily for handheld electronic devices, we are now a one-stop shop for design development and manufacturing solutions serving a wide range of clients in the industrial, commercial, medical and consumer industries.

For more information, contact:         Anthony Camarda, CFO, Forward Industries, Inc.                (631) 547-3041, acamarda@forwardindustries.com

FORWARD INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
				March 31,				September 30,
					2022				2021
Assets				(Unaudited)
Current assets:
Cash				$	1,541,192			$	1,410,365
Accounts receivable, net					8,685,896				8,760,715
Inventories, net					3,897,479				2,062,557
Prepaid expenses and other current assets					816,250				561,072
Total current assets					14,940,817				12,794,709
Property and equipment, net					247,345				167,997
Intangible assets, net					1,212,279				1,318,658
Goodwill					1,758,682				1,758,682
Operating lease right of use assets, net					3,741,813				3,743,242
Other assets					72,251				72,251
Total assets				$	21,973,187			$	19,855,539
Liabilities and shareholders' equity
Current liabilities:
Note payable to Forward China				$	1,500,000			$	-
Accounts payable					463,901				391,992
Due to Forward China					7,239,885				5,733,708
Deferred income					620,572				187,695
Current portion of earnout consideration					25,000				25,000
Current portion of operating lease liability					405,811				340,151
Accrued expenses and other current liabilities					787,010				529,497
Total current liabilities					11,042,179				7,208,043
Other liabilities:
Note payable to Forward China					-				1,600,000
Operating lease liability, less current portion					3,514,064				3,559,053
Earnout consideration, less current portion					45,000				45,000
Total other liabilities					3,559,064				5,204,053
Total liabilities					14,601,243				12,412,096
Commitments and contingencies
Shareholders' equity:
Common stock, par value $0.01 per share; 40,000,000 shares authorized; 10,061,185 shares issued and outstanding at March 31, 2022 and September 30, 2021					100,612				100,612
Additional paid-in capital					20,019,288				19,914,476
Accumulated deficit					(12,747,956	)			(12,571,645	)
Total shareholders' equity					7,371,944				7,443,443
Total liabilities and shareholders' equity				$	21,973,187			$	19,855,539

FORWARD INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
	For the Three Months Ended March 31,								For the Six Months Ended March 31,
		2022				2021				2022				2021
Revenues, net	$	10,314,563			$	8,395,379			$	21,928,304			$	18,112,982
Cost of sales		8,061,889				6,651,933				17,056,861				14,106,650
Gross profit		2,252,674				1,743,446				4,871,443				4,006,332
Sales and marketing expenses		704,102				578,436				1,441,780				1,181,397
General and administrative expenses		1,871,311				1,981,186				3,538,188				3,808,604
Loss from operations		(322,739	)			(816,176	)			(108,525	)			(983,669	)
Gain on forgiveness of note payable		-				-				-				(1,356,570	)
Fair value adjustment of earn-out consideration		-				-				-				(30,000	)
Interest income		-				(33,554	)			-				(56,301	)
Interest expense		30,864				46,714				63,691				93,106
Other expense, net		2,732				5,392				4,095				1,788
(Loss)/income before income taxes		(356,335	)			(834,728	)			(176,311	)			364,308
Provision for income taxes		-				-				-				-
Net (loss)/income	$	(356,335	)		$	(834,728	)		$	(176,311	)		$	364,308
(Loss)/earnings per share:
Basic	$	(0.04	)		$	(0.08	)		$	(0.02	)		$	0.04
Diluted	$	(0.04	)		$	(0.08	)		$	(0.02	)		$	0.04
Weighted average common shares outstanding:
Basic		10,061,185				9,909,497				10,061,185				9,897,385
Diluted		10,061,185				9,909,497				10,061,185				10,378,733