TRUG TruGolf Holdings Inc

TruGolf Holdings, Inc. (NASDAQ: TRUG), a leading golf technology company, announced today its results for the third quarter of 2024. The Company reported strong third quarter sales of $6,236,795, an increase of 82 percent as compared to the third quarter of 2023. EPS for the third quarter of 2024 was $0.00. EBITDA for the third quarter of 2024 was $1.1 million, inclusive of $148,000 of franchising expenses and zero franchising revenues recognized. The gains were driven by enthusiastic market adoption of new hardware and software products launched earlier this year.

“This strong third quarter growth is a direct result of the significant investment we have made in our technology over the past two years, “said Chief Executive Officer and Director Chris Jones. “We believe this is just the beginning of a dynamic growth period for TruGolf and the sports technology industry. In addition to our hardware and software sales, our franchise concept, launched in the third quarter, has an initial 120 franchise locations committed to coming online all throughout the United States. This franchise initiative represents the future of how users will engage with the sport and adds significant tailwinds to our growing technology sales. The enthusiastic adoption of our new Hardware, Software, and Web products, combined with the enthusiasm for our franchise concept, have led us to increase our full year revenue target and EBIDTA goals for 2024.”

Revised Outlook:

• Total revenue for end of 2024 is expected to grow by 9%-13% as compared to end of 2023 levels. 
• EBITDA for the second half of 2024 is estimated to range between $1,100,000 to $1,500,000, showing a return to profitability following significant investments made over the past two years in technology designed to drive significant, future growth and expansion opportunities.

Financial Operations:

• Gross margin for the third quarter of 2024 was 69% as compared to 55 % in the third quarter of 2023. 
• Year to date gross margin was 66% as compared to 67% during the same period in 2023. 
• Operating income for third quarter 2024 hit $872,000, an increase of 137% compared to the third quarter 2023 operating loss of ($2.3 million). 
• The 2024 year to date operating loss is 87% lower at ($856,000) as compared to ($6.8 million) for the same period in 2023.
• Year to date 2024 compensation expenses decreased by $1.5 million as compared to the same period in 2023.
• Year to date 2024 SGA expenses also declined by $4.1 million as compared to the same period in 2023.
• Free cash flow year to date 2024 was $3.1 million as compared to ($6.1 million) during the same period in 2023. 
• EBITDA year to date 2024 is ($277,000) inclusive of $306,539 of franchising expenses and zero franchising revenue recognized. Excluding franchising expenses, EBITDA it is slightly positive year to date 2024.

Disclaimer on Forward Looking Statements

This news release contains certain statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements that are not of historical fact constitute “forward-looking statements” and accordingly, involve estimates, assumptions, forecasts, judgements and uncertainties. Forward-looking statements include, without limitation, the Company’s forecasts for total sales and EBITDA discussed above. There are a number of factors that could cause actual results or outcomes to differ materially from those addressed in the forward-looking statements. Such factors are detailed in the Forward Looking Statements and Risk Factors sections of the Company’s S-1 filed with the Securities and Exchange Commission. We do not undertake an obligation to update our forward-looking statements to reflect future events.

About TruGolf, Inc.:

TruGolf is a golf technology company, committed to making golf, easy. From innovative uses for AI to build content and enhanced image and spatial analysis, to gamified golf improvement plans, TruGolf is an industry leader in the growing technological revolution in the sport of golf. Since TruGolf's founding it has redefined what is possible with golf through technology. TruGolf’s suite of Hardware, Software, and Web Products make the game easier to Play, Improve and Enjoy.

TRUGOLF HOLDINGS, INC.CONDENSED CONSOLIDATED BALANCE SHEETSAS OF SEPTEMBER 30, 2024 AND DECEMBER 31, 2023

		2024				2023
		(unaudited)
ASSETS
Current assets:
Cash and cash equivalents		$	7,452,185			$	3,297,564
Restricted cash			-				2,100,000
Marketable investment securities			-				2,478,953
Accounts receivable, net			4,542,097				2,398,872
Inventory, net			2,324,230				2,119,084
Prepaid expenses			99,032				262,133
Total current assets			14,417,544				12,656,606
Property and equipment, net			131,581				234,308
Capitalized software development costs, net			1,738,417				-
Right-of-use assets			721,051				972,663
Other long-term assets			31,097				1,905,983
Total assets		$	17,039,690			$	15,769,560
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable		$	2,288,208			$	2,059,771
Customer deposits			4,600,105				1,704,224
Deferred revenue			575,000				-
Notes payable, current portion			9,854				9,425
Notes payable to related parties, current portion			1,937,000				1,237,000
Line of credit, bank			802,738				802,738
Margin line of credit account			-				1,980,937
Convertible notes payable			954,622				954,622
Notes payable assumed in Merger			1,465,000				-
Accrued interest			1,649,341				459,872
Accrued and other current liabilities			1,201,071				1,125,495
Accrued and other current liabilities - assumed in Merger			295,008				-
Lease liability, current portion			375,660				334,255
Total current liabilities			16,153,607				10,668,339
Non-current liabilities:
Notes payable, net of current portion			12,290				2,402,783
Note payables to related parties, net of current portion			874,000				861,000
PIPE loan payable, net			4,232,448				-
Dividend notes payable			4,023,923				4,023,923
Gross sales royalty payable			1,000,000				1,000,000
Lease liability, net of current portion			380,386				668,228
Other liabilities			589,619				63,015
Total liabilities			27,266,273				19,687,288
Commitments and Contingencies
Stockholders’ deficit:
Preferred stock, $0.0001 par value, 10 million share authorized; zero shares issued and outstanding, respectively			-				-
Common stock - Series A, $0.0001 par value, 90 million shares authorized; 11,887,985 and 13,098 shares issued and outstanding, respectively.			1,189				120
Common stock - Series B, $0.0001 par value, 10 million shares authorized; 1,716,860 and 0 shares issued and outstanding, respectively.			172				-
Treasury stock at cost, 4,692 shares of common stock held, respectively			(2,037,000	)			(2,037,000	)
Additional paid-in capital			7,100,503				10,479,738
Accumulated other comprehensive loss			-				(1,662	)
Accumulated deficit / losses			(15,291,447	)			(12,358,924	)
Total stockholders’ deficit			(10,226,583	)			(3,917,728	)
Total liabilities and stockholders’ deficit		$	17,039,690			$	15,769,560

TRUGOLF HOLDINGS, INC.CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONSFOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30,(unaudited)

		For the Three Months EndedSeptember 30,								For the Nine Months Ended September 30,
		2024				2023				2024				2023
Revenues, net		$	6,236,795			$	3,431,735			$	15,121,980			$	13,788,700
Cost of revenues			1,924,093				1,533,691				5,183,328				4,531,429
Gross profit			4,312,702				1,898,044				9,938,652				9,257,271
Operating expenses:
Royalties			166,631				130,610				719,668				447,366
Salaries, wages and benefits			1,695,678				2,252,848				4,654,560				6,171,878
Selling, general and administrative			1,578,112				1,838,297				5,420,872				9,455,683
Total operating expenses			3,440,421				4,221,755				10,795,100				16,074,927
(Loss) income from operations			872,281				(2,323,711	)			(856,448	)			(6,817,656	)
Other (expenses) income:
Interest income			38,592				21,197				105,800				71,542
Interest expense			(971,048	)			(358,354	)			(2,176,810	)			(1,265,775	)
Loss on investment			-				-				(3,912	)			-
Total other expense			(932,456	)			(337,157	)			(2,074,922	)			(1,194,233	)
Loss from operations before income taxes			(60,175	)			(2,660,868	)			(2,931,370	)			(8,011,889	)
Provision for income taxes			-				-				-				-
Net loss		$	(60,175	)		$	(2,660,868	)		$	(2,931,370	)		$	(8,011,889	)
Basic and diluted net loss per share attributable to common stockholders		$	(0.00	)		$	(219.38	)		$	(0.28	)		$	(660.56	)
Basic and diluted weighted average common shares			13,380,737				12,129				10,550,277				12,129

TRUGOLF HOLDINGS, INC.CONDENSED CONSOLIDATED STATEMENTS OF CASHFLOWSFOR THE NINE MONTHS ENDED SEPTEMBER 30,(unaudited)

		2024				2023
Cash flows from operating activities:
Net loss		$	(2,931,370	)		$	(8,011,889	)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Depreciation and amortization expense			331,728				45,682
Amortization of PIPE convertible notes original issue discount			47,447				183,695
Amortization of right-of-use asset			251,612				217,101
Bad debt expense			-				665,920
Change in OCI			1,662				-
Stock issued for services			-				4,493,333
Stock issued for interest			341,696				-
Changes in operating assets and liabilities:
Accounts receivable, net			(2,143,225	)			(1,057,286	)
Inventory, net			(205,146	)			(1,289,741	)
Prepaid expenses			163,101				(76,690	)
Other current assets			2,478,953				17,840
Other assets			-				(2,026,082	)
Accounts payable			228,437				837,049
Customer deposits			2,895,881				(70,508	)
Deferred revenue			575,000				-
Accrued interest			1,208,014				397,517
Accrued and other current liabilities			75,576				(290,484	)
Other liabilities			(1,148	)			38,357
Lease liability			(246,437	)			(194,953	)
Net cash provided by (used in) operating activities			3,071,781				(6,121,139	)
Cash flows from investing activities:
Purchase of property and equipment			-				(89,024	)
Capitalized software development costs			(1,967,418	)			-
Reduction in long term assets			(115	)			(2,419,725	)
Net cash used in investing activities			(1,967,533	)			(2,508,749	)
Cash flows from financing activities:
Proceeds from line of credit			-				1,945,397
Proceeds from notes payable			-				2,499,999
Repayments of notes payable			(7,005	)			(89,337	)
Repayments of notes payable - related party			(287,000	)			(18,500	)
Proceeds from notes payable - related party			1,000,000				-
Payments on assumed liabilities in Merger			(15,716	)			-
Proceeds from convertible notes			-				185,500
PIPE loan, net of OID discount			4,185,000				-
Cash acquired in Merger			103,818				-
Costs of Merger paid from PIPE loan			(1,947,787	)			-
Repayment of line of credit			(1,980,937	)			-
Repayment of notes payable assumed in Merger			(100,000	)			-
Dividends paid			-				(75,096	)
Net cash provided by financing activities			950,373				4,447,963
Net change in cash, cash equivalents, and restricted cash			2,054,621				(4,181,925	)
Cash, cash equivalents, and restricted cash, beginning of period			5,397,564				9,656,266
Cash, cash equivalents and restricted cash, end of period		$	7,452,185			$	5,474,341
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for income tax		$	-			$	-
Cash paid for interest		$	548,041			$	868,264
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING and FINANCING ACTIVITIES:
Notes payable assumed in Merger		$	1,565,000			$	-
Accrued liabilities assumed in Merger		$	310,724			$	-
Remeasurement of common stock exchanged/issued in Merger		$	(1,875,724	)		$	-
Right of Use Asset in exchange for lease liability		$	-			$	537,995

Contact:   Michael Bacal                  mbacal@darrowir.com                  917-886-9071