Powerfleet Inc.
Powerfleet Inc.
22/08/2024 | Press release | Distributed by Public on 22/08/2024 20:15
Powerfleet Reports First Quarter 2025 Financial Results
Powerfleet Reports First Quarter 2025 Financial Results
Dennis FerreiraAugust 22, 2024
Focused execution following the business combination with MiX Telematics evidenced by annual revenue and AEBITDA growth of +10% and +50%, respectively
Revenue Grows 10.2% annually to $75.4 million, driven by unity ecosystem and safety-centric solutions
Cost synergy traction with $8.7 million in annual run-rate savings secured by end of June quarter
WOODCLIFF LAKE, N.J., Aug. 22, 2024/PRNewswire/ - Powerfleet, Inc. (Nasdaq: AIOT), reported its financial results for the first quarter ended June 30, 2024. This marks the first full quarter post-close of the MiX Telematics Ltd. business combination with prior year comparison numbers adjusted to reflect the pro forma financial performance of the combined businesses.
FIRST QUARTER 2025 HIGHLIGHTS
- Total revenue was $75.4 million, up 10.2% year-over-year, driven by the strength of our safety-centric product solutions.
- Product revenue rose by 29% year-over-year to $18.7 million, reflecting strong demand for our differentiated product offerings; building our recurring revenue base; and contributing to a 7% expansion in product gross margin.
- Excluding the impact of non-cash charges from the amortization of acquisition-related intangibles, gross profit increased by $3.5 million, or 9.0%.
- Adjusted EBITDA, a non-GAAP metric, totaled $13.7 million, a significant 52.2% increase year-over-year, driven by strong topline performance and the realization of initial cost synergies.
MANAGEMENT COMMENTARY
"I'm incredibly proud of the traction we've gained and the significant progress our team has made following the close of the MiX Telematics transaction in early April", said CEO Steve Towe. "The successful execution of our integration strategy is already evident in our strong financial performance this quarter, with a 10% increase in combined revenue and a remarkable 50% rise in adjusted EBITDA compared to the prior year. This reflects our ability to drive radical change without disrupting operations, setting a solid foundation for sustained growth."
"Our strategic rationale behind the MiX transaction was clear: securing scale is critical to distinguishing our combined business from competitors and aligning with market leaders as the core telematics industry rapidly transforms. By leveraging our Unity ecosystem's advanced AI platforms and next-generation data capabilities, we are poised to thrive in a market that increasingly values innovation and agility."
"We are also off to a strong start in achieving our cost synergy commitments, securing $8.7 million in annual savings within the first 90 days. These savings have provided us with the flexibility to make targeted investments in our go-to-market and customer success teams, leading to a 30% increase in our sales force in the coming months. As we continue to work towards our target of $27 million in savings, we remain focused on scaling our operations and driving sustainable growth as we advance toward our goal of rule 40 performance over the next two years."
FIRST QUARTER 2025 FINANCIAL RESULTS
Total revenue for the quarter increased by 10.2% year-over-year to $75.4 million, up from $68.4 million in the same period last year. This growth was largely driven by the continued success of the company's differentiated safety-centric product solutions, with product revenue increasing over 29% to $18.7 million.
Service revenue grew by 5% year-over-year to $56.7 million. This performance highlights the strength of the Unity product strategy and the benefits of operating at scale globally, which helped mitigate the impact of previously disclosed churn in the legacy MiX customer base and macro and geopolitical pressures in certain regions, such as Israel.
Combined gross margin of 52.6% includes a $3.0 million non-cash expense for the amortization of acquisition-related intangibles from the MiX business combination. Excluding this expense, adjusted gross margin was 56.5%, compared to 57.2% in the prior year, with the current period's performance partially affected by a higher proportion of product sales.
Operating expenses for the quarter totaled $57.9 million, including $20.4 million in one-time transaction, restructuring, and accelerated stock-based compensation costs. On an adjusted basis, excluding these one-time costs, operating expenses were $37.5 million and in line with the prior year.
The company reported a net loss attributable to common stockholders of $22.3 million, or $(0.21) per share, compared to $(0.04) in the prior year. However, after adjusting for one-time expenses and the amortization of acquisition-related intangibles, adjusted earnings per share was $0.00 for the current year.
Adjusted EBITDA increased by 52.2% to $13.7 million from $9.0 million in the previous year. This growth was driven by strong topline performance, resulting in a $3.5 million increase in gross margin after accounting for the impact of the amortization of acquisition-related intangibles.
The company ended the quarter with net debt of $108.2 million, comprising $31.4 million in cash and $139.6 million in total debt. After accounting for unsettled transaction costs, pro forma net debt was $114 million versus $110 million at the MiX transaction close date. The $4 million increase in pro forma net debt was primarily driven by an increase in net working capital of $7.0 million that is directly attributable to higher receivables following strong topline performance.
FULL-YEAR 2025 FINANCIAL OUTLOOK
The company is reiterating its updated guidance from the August 6th fireside chat. Full-year 2025 revenue is expected to exceed $300 million, an increase from the initial guidance of approximately $300 million. Adjusted EBITDA is anticipated to exceed $60 million, inclusive of an incremental $5 million in secured exit run-rate cost synergies, compared to its initial guidance of around $60 million.
INVESTOR CONFERENCE CALL
As previously announced, Powerfleet will hold a conference call on Thursday, August 22, 2024, at 8:30 a.m. Eastern time (5:30 a.m. Pacific time) to discuss results for the quarter ended June 30, 2024.
Management will make prepared remarks followed by a question-and-answer session.
Date: Thursday, August 22, 2024
Time: 8:30 a.m. Eastern time (5:30 a.m. Pacific time)
Toll Free: 888-506-0062
International: 973-528-0011
Participant Access Code: 263975
The conference call will be broadcast simultaneously and available for replay here and via the investor section of the company's website at ir.powerfleet.com.
NON-GAAP FINANCIAL MEASURES
To supplement its financial statements presented in accordance with Generally Accepted Accounting Principles (GAAP), Powerfleet provides certain non-GAAP measures of financial performance. These non-GAAP measures include adjusted EBITDA, adjusted gross margin, adjusted operating expenses and adjusted earnings per share. Reference to these non-GAAP measures should be considered in addition to results prepared under current accounting standards, but are not a substitute for, or superior to, GAAP results. These non-GAAP measures are provided to enhance investors' overall understanding of Powerfleet's current financial performance. Specifically, Powerfleet believes the non-GAAP measures provide useful information to both management and investors by excluding certain expenses, gains and losses and fluctuations in currency rates that may not be indicative of its core operating results and business outlook. These non-GAAP measures are not measures of financial performance or liquidity under GAAP and, accordingly, should not be considered as an alternative to net income, gross margin, cash flow from operating activities or earnings per share as an indicator of operating performance or liquidity. Because Powerfleet's method for calculating the non-GAAP measures may differ from other companies' methods, the non-GAAP measures may not be comparable to similarly titled measures reported by other companies. Reconciliation of all non-GAAP measures included in this press release to the most directly comparable GAAP measures can be found in the financial tables included in this press release.
ABOUT POWERFLEET
Powerfleet (Nasdaq: AIOT; JSE: PWR; TASE: PWFL) is a global leader in the artificial intelligence of things (AIoT) software-as-a-service (SaaS) mobile asset industry. With more than 30 years of experience, Powerfleet unifies business operations through the ingestion, harmonization, and integration of data, irrespective of source, and delivers actionable insights to help companies save lives, time, and money. Powerfleet's ethos transcends our data ecosystem and commitment to innovation; our people-centric approach empowers our customers to realize impactful and sustained business improvement. The company is headquartered in New Jersey, United States, with offices around the globe. Explore more at www.powerfleet.com.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements within the meaning of federal securities laws. Powerfleet's actual results may differ from its expectations, estimates and projections and consequently, you should not rely on these forward-looking statements as predictions of future events. Forward-looking statements may be identified by words such as "expect," "estimate," "project," "budget," "forecast," "anticipate," "intend," "plan," "may," "will," "could," "should," "believes," "predicts," "potential," "continue," and similar expressions.
These forward-looking statements include, without limitation, our expectations with respect to its beliefs, plans, goals, objectives, expectations, anticipations, assumptions, estimates, intentions and future performance, as well as anticipated financial impacts of our transaction with MiX Telematics. Forward-looking statements involve significant known and unknown risks, uncertainties and other factors, which may cause their actual results, performance or achievements to be materially different from the future results, performance or achievements expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be forward-looking statements. Most of these factors are outside our control and are difficult to predict. The risks and uncertainties referred to above include, but are not limited to, risks related to: (i) future economic and business conditions, including the conflict between Israel and Hamas; (ii) integration of our and MiX Telematics' businesses and the ability to recognize the anticipated synergies and benefits of the transaction with MiX Telematics; (iii) the loss of any of our key customers or reduction in the purchase of our products by any such customers; (iv) the failure of the markets for our products to continue to develop; (v) the negative effects of the transaction on the market price of our securities; (vi) our inability to adequately protect our intellectual property; (vii) our inability to manage growth; (viii) the effects of competition from a wide variety of local, regional, national and other providers of wireless solutions; (ix) failure to make timely filings of our periodic reports with the Securities and Exchange Commission ("SEC"), including our transition report on Form 10-KT for the period from January 1, 2024 to March 31, 2024 and our quarterly report on Form 10-Q for the quarter ended June 30, 2024, and (x) such other factors as are set forth in the periodic reports filed by us with the SEC, including but not limited to those described under the heading "Risk Factors" in our annual reports on Form 10-K, quarterly reports on Form 10-Q and any other filings made with the SEC from time to time, which are available via the SEC's website at http://www.sec.gov. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove to be incorrect, actual results may vary materially from those indicated or anticipated by these forward-looking statements. Therefore, you should not rely on any of these forward-looking statements.
The forward-looking statements included in this press release are made only as of the date of this press release, and except as otherwise required by applicable securities law, we assume no obligation, nor do we intend to publicly update or revise any forward-looking statements to reflect subsequent events or circumstances.
Powerfleet Investor Contacts
Carolyn Capaccio and Jody Burfening
LHA Investor Relations
[email protected]
Powerfleet Media Contact
Andrea Hayton
[email protected]
+1 (610) 401-1999
|
POWERFLEET, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Operations (In thousands, except per share data) |
||
|
Three Months Ended June 30, |
||
|
2023 |
2024 |
|
|
Pro Forma |
Consolidated |
|
|
Revenues: |
||
|
Products |
$ 14,523 |
$ 18,738 |
|
Services |
53,920 |
56,692 |
|
Total revenues |
68,443 |
75,430 |
|
Cost of revenues: |
||
|
Cost of products |
10,931 |
12,751 |
|
Cost of services |
18,381 |
23,031 |
|
Total cost of revenues |
29,312 |
35,782 |
|
Gross profit |
39,131 |
39,648 |
|
Operating expenses: |
||
|
Selling, general and administrative expenses |
34,575 |
54,782 |
|
Research and development expenses |
3,565 |
3,101 |
|
Total operating expenses |
38,140 |
57,883 |
|
Gain/(loss) from operations |
991 |
(18,235) |
|
Interest income |
291 |
304 |
|
Interest expense |
(676) |
(2,691) |
|
Bargain purchase - Movingdots |
283 |
- |
|
Other income, net |
(709) |
(624) |
|
Net gain/(loss) before income taxes |
180 |
(21,246) |
|
Income tax expense |
(1,836) |
(1,053) |
|
Net loss before non-controlling interest |
(1,656) |
(22,299) |
|
Non-controlling interest |
(6) |
(13) |
|
Net loss |
(1,662) |
(22,312) |
|
Accretion of preferred stock |
(1,772) |
- |
|
Preferred stock dividend |
(1,128) |
(25) |
|
Net loss attributable to common stockholders |
$ (4,562) |
$ (22,337) |
|
Net loss per share attributable to common stockholders - basic and diluted |
$ (0.04) |
$ (0.21) |
|
Weighted average common shares outstanding - basic and diluted |
106,390 |
107,136 |
|
POWERFLEET, INC. AND SUBSIDIARIES Condensed Consolidated Balance Sheets (In thousands, except per share data) |
||
|
March 31, 2024 |
June 30, 2024 |
|
|
Pro Forma |
Consolidated |
|
|
ASSETS |
||
|
Current assets: |
||
|
Cash and cash equivalents |
$ 51,091 |
$ 30,242 |
|
Restricted cash |
86,104 |
1,151 |
|
Accounts receivables |
55,008 |
60,132 |
|
Inventory, net |
25,800 |
25,832 |
|
Deferred costs - current |
42 |
24 |
|
Prepaid expenses and other current assets |
17,784 |
16,498 |
|
Total current assets |
235,829 |
133,879 |
|
Fixed assets, net |
48,306 |
49,705 |
|
Goodwill |
121,713 |
300,775 |
|
Intangible assets, net |
40,444 |
170,093 |
|
Right-of-use asset |
11,222 |
10,722 |
|
Severance payable fund |
3,796 |
3,760 |
|
Deferred tax asset |
3,874 |
3,544 |
|
Other assets |
19,090 |
12,435 |
|
Total assets |
$ 484,274 |
$ 684,913 |
|
LIABILITIES |
||
|
Current liabilities: |
||
|
Short-term bank debt and current maturities of long-term debt |
$ 22,109 |
$ 27,604 |
|
Accounts payable and accrued expenses |
60,763 |
68,771 |
|
Deferred revenue - current |
12,236 |
10,019 |
|
Lease liability - current |
2,648 |
2,441 |
|
Contingent consideration |
- |
- |
|
Total current liabilities |
97,756 |
108,835 |
|
Long-term debt - less current maturities |
113,810 |
111,957 |
|
Deferred revenue - less current portion |
4,892 |
4,825 |
|
Lease liability - less current portion |
8,773 |
8,555 |
|
Accrued severance payable |
4,597 |
4,533 |
|
Deferred tax liability |
18,669 |
52,645 |
|
Other long-term liabilities |
2,980 |
3,015 |
|
Total liabilities |
251,477 |
294,365 |
|
Convertible redeemable preferred stock: |
90,273 |
- |
|
STOCKHOLDERS' EQUITY |
||
|
Preferred stock |
- |
- |
|
Common stock |
63,842 |
1,096 |
|
Additional paid-in capital |
200,218 |
578,514 |
|
Accumulated deficit |
(78,516) |
(177,108) |
|
Accumulated other comprehensive loss |
(17,133) |
(567) |
|
Treasury stock |
(25,997) |
(11,518) |
|
Total stockholders' equity |
142,414 |
390,417 |
|
Non-controlling interest |
110 |
131 |
|
Total equity |
142,524 |
390,548 |
|
Total liabilities, convertible redeemable preferred stock, and |
$ 484,274 |
$ 684,913 |
|
POWERFLEET, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Cash Flows (In thousands) |
||
|
Three Months Ended June 30, |
||
|
2023 |
2024 |
|
|
Pro Forma |
Consolidated |
|
|
Cash flows from operating activities |
||
|
Net loss |
$ (1,662) |
$ (22,312) |
|
Adjustments to reconcile net loss to cash used in operating activities: |
||
|
Non-controlling interest |
6 |
13 |
|
Gain on bargain purchase |
(283) |
- |
|
Inventory reserve |
443 |
257 |
|
Stock based compensation expense |
1,092 |
5,929 |
|
Depreciation and amortization |
6,334 |
10,335 |
|
Right-of-use assets, non-cash lease expense |
660 |
760 |
|
Bad debts expense |
1,416 |
1,993 |
|
Deferred income taxes |
1,990 |
1,021 |
|
Shares issued for transaction bonuses |
- |
891 |
|
Other non-cash items |
1,760 |
481 |
|
Changes in operating assets and liabilities: |
||
|
Accounts receivables |
(4,008) |
(6,973) |
|
Inventories |
984 |
(624) |
|
Prepaid expenses and other current assets |
(38) |
(1,518) |
|
Deferred costs |
(1,677) |
(1,789) |
|
Deferred revenue |
58 |
(142) |
|
Accounts payable and accrued expenses |
(1,991) |
4,993 |
|
Lease liabilities |
(650) |
(927) |
|
Accrued severance payable, net |
88 |
(2) |
|
Net cash generated by/(used in) operating activities |
4,522 |
(7,615) |
|
Cash flows from investing activities |
||
|
Acquisition, net of cash assumed |
- |
27,531 |
|
Capitalized software development costs |
(2,352) |
(2,308) |
|
Capital expenditures |
(4,582) |
(5,586) |
|
Net cash (used in)/provided by investing activities |
(6,934) |
19,637 |
|
Cash flows from financing activities |
||
|
Repayment of long-term debt |
(1,875) |
(493) |
|
Short-term bank debt, net |
2,800 |
4,161 |
|
Purchase of treasury stock upon vesting of restricted stock |
(4) |
(2,836) |
|
Payment of preferred stock dividend and redemption of preferred stock |
(1,128) |
(90,298) |
|
Proceeds from exercise of stock options, net |
36 |
- |
|
Cash paid on dividends to affiliates |
(1,331) |
(4) |
|
Net cash used in financing activities |
(1,502) |
(89,470) |
|
Effect of foreign exchange rate changes on cash and cash equivalents |
(1,930) |
(824) |
|
Net decrease in cash and cash equivalents, and restricted cash |
(5,844) |
(78,272) |
|
Cash and cash equivalents, and restricted cash at beginning of the period |
55,746 |
109,664 |
|
Cash and cash equivalents, and restricted cash at end of the period |
$ 49,902 |
$ 31,393 |
|
Reconciliation of cash, cash equivalents, and restricted cash, |
||
|
Cash and cash equivalents |
54,656 |
24,354 |
|
Restricted cash |
1,090 |
85,310 |
|
Cash, cash equivalents, and restricted cash, beginning of the period |
$ 55,746 |
$ 109,664 |
|
Reconciliation of cash, cash equivalents, and restricted cash, end of |
||
|
Cash and cash equivalents |
48,830 |
30,242 |
|
Restricted cash |
1,072 |
1,151 |
|
Cash, cash equivalents, and restricted cash, end of the period |
$ 49,902 |
$ 31,393 |
|
Supplemental disclosure of cash flow information: |
||
|
Cash paid for: |
||
|
Taxes |
$ 273 |
$ 41 |
|
Interest |
$ 356 |
$ 3,057 |
|
Noncash investing and financing activities: |
||
|
Common stock issued for transaction bonus |
$ - |
$ 9 |
|
POWERFLEET, INC. AND SUBSIDIARIES RECONCILIATION OF GAAP TO ADJUSTED EBITDA FINANCIAL MEASURES (In thousands) |
||
|
Three Months Ended June 30, |
||
|
2023 |
2024 |
|
|
Pro Forma |
Consolidated |
|
|
Net loss attributable to common stockholders |
$ (4,562) |
$ (22,337) |
|
Non-controlling interest |
6 |
13 |
|
Preferred stock dividend and accretion |
2,901 |
25 |
|
Interest expense |
690 |
2,916 |
|
Other expense, net |
- |
1 |
|
Income tax expense |
1,836 |
1,053 |
|
Depreciation and amortization |
6,334 |
10,335 |
|
Stock-based compensation |
1,092 |
5,929 |
|
Foreign Currency Translation |
368 |
108 |
|
Restructuring Related Expenses |
448 |
1,198 |
|
Gain on Bargain purchase - Movingdots |
(283) |
- |
|
Net profit on fixed assets |
(4) |
- |
|
Contingent consideration remeasurement |
(24) |
- |
|
Acquisition related expenses |
223 |
14,494 |
|
Adjusted EBITDA |
$ 9,025 |
$ 13,735 |
|
POWERFLEET, INC. AND SUBSIDIARIES RECONCILIATION OF GAAP TO NON-GAAP NET INCOME (LOSS) FINANCIAL MEASURES (In thousands) |
||
|
Three Months Ended June 30, |
||
|
2023 |
2024 |
|
|
Pro Forma |
Consolidated |
|
|
Net loss |
$ (1,662) |
$ (22,312) |
|
Incremental Intangible assets amortization expense as a result of MiX |
- |
2,995 |
|
Stock-based compensation (non-recurring/accelerated cost) |
- |
4,693 |
|
Foreign currency translation |
368 |
108 |
|
Income tax effect of net foreign exchange gains/(losses) |
425 |
(747) |
|
Restructuring related expenses |
448 |
1,198 |
|
Income tax effect of restructuring costs |
(5) |
(103) |
|
Acquisition related expenses |
223 |
14,494 |
|
Non-GAAP net (loss)/income |
$ (203) |
$ 326 |
|
Weighted average shares outstanding |
106,390 |
$ 107,136 |
|
Non-GAAP net (loss)/income per share - basic |
(0.002) |
$ 0.003 |
|
POWERFLEET, INC. AND SUBSIDIARIES ADJUSTED GROSS PROFIT MARGINS (In thousands) |
||
|
Three Months Ended June 30, |
||
|
2023 |
2024 |
|
|
Pro Forma |
Consolidated |
|
|
Revenues: |
||
|
Products |
$ 14,523 |
$ 18,738 |
|
Services |
53,920 |
56,692 |
|
Total revenues |
68,443 |
75,430 |
|
Cost of revenues: |
||
|
Cost of products |
10,931 |
12,751 |
|
Cost of services |
18,381 |
23,031 |
|
Total cost of revenues |
29,312 |
35,782 |
|
Gross profit |
39,131 |
39,648 |
|
Product Margin |
24.7 % |
32.0 % |
|
Service Margin |
65.9 % |
59.4 % |
|
Total Gross profit margin |
57.2 % |
52.6 % |
|
Incremental Intangible assets amortization expense as a result of MiX |
- |
2,995 |
|
Product Margin |
24.7 % |
32.0 % |
|
Service Margin |
65.9 % |
64.7 % |
|
Adjusted Total Gross profit margin |
57.2 % |
56.5 % |
|
POWERFLEET, INC. AND SUBSIDIARIES ADJUSTED OPERATING EXPENSES (In thousands) |
||
|
Three Months Ended June 30, |
||
|
2023 |
2024 |
|
|
Pro Forma |
Consolidated |
|
|
Total operating expenses |
$ 38,140 |
$ 57,883 |
|
Adjusted for once-off costs |
||
|
Acquisition related expenses |
223 |
14,494 |
|
Stock-based compensation (non-recurring/accelerated cost) |
- |
4,693 |
|
Restructuring Related Expenses |
448 |
1,198 |
|
$ 671 |
$ 20,385 |
|
|
Adjusted operating expenses |
$ 37,469 |
$ 37,498 |
|
POWERFLEET, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Operations (In thousands, except per share data) |
||
|
Year Ended March 31, |
||
|
2023 |
2024 |
|
|
Pro Forma |
Consolidated |
|
|
Revenues: |
||
|
Products |
$ 70,397 |
$ 67,665 |
|
Services |
210,072 |
219,239 |
|
Total revenues |
280,469 |
286,904 |
|
Cost of revenues: |
||
|
Cost of products |
51,143 |
48,316 |
|
Cost of services |
71,486 |
79,636 |
|
Total cost of revenues |
122,629 |
127,952 |
|
Gross profit |
157,840 |
158,952 |
|
Operating expenses: |
||
|
Selling, general and administrative expenses |
138,566 |
151,839 |
|
Research and development expenses |
13,049 |
14,793 |
|
Total operating expenses |
151,615 |
166,632 |
|
Gain/(loss) from operations |
6,225 |
(7,680) |
|
Interest income |
1,241 |
1,480 |
|
Interest expense |
(689) |
(4,521) |
|
Bargain purchase - Movingdots |
7,234 |
1,800 |
|
Other income/(expense), net |
1,622 |
(266) |
|
Net gain/(loss) before income taxes |
15,633 |
(9,187) |
|
Income tax expense |
(9,749) |
(7,014) |
|
Net gain/(loss) before non-controlling interest |
5,884 |
(16,201) |
|
Non-controlling interest |
2 |
(50) |
|
Net gain/(loss) |
5,886 |
(16,251) |
|
Accretion of preferred stock |
(6,210) |
(15,480) |
|
Preferred stock dividend |
(4,310) |
(4,514) |
|
Net loss attributable to common stockholders |
$ (4,634) |
$ (36,245) |
|
Net loss per share attributable to common stockholders - basic and diluted |
$ (0.04) |
$ (0.34) |
|
Weighted average common shares outstanding - basic and diluted |
106,073 |
106,894 |
|
POWERFLEET, INC. AND SUBSIDIARIES RECONCILIATION OF GAAP TO NON-GAAP NET INCOME (LOSS) FINANCIAL MEASURES (In thousands) |
||
|
Year Ended March 31, |
||
|
2023 |
2024 |
|
|
Pro Forma |
Consolidated |
|
|
Net loss attributable to common stockholders |
$ (4,634) |
$ (36,245) |
|
Non-controlling interest |
(2) |
49 |
|
Preferred stock dividend and accretion |
10,520 |
19,995 |
|
Interest expense |
947 |
3,192 |
|
Other expense, net |
67 |
87 |
|
Income tax expense |
9,749 |
7,014 |
|
Depreciation and amortization |
24,072 |
29,548 |
|
Stock-based compensation |
5,220 |
5,214 |
|
Foreign Currency Translation |
(3,191) |
1,493 |
|
Restructuring Related Expenses |
2,445 |
1,065 |
|
Gain on Bargain purchase - Movingdots |
(7,234) |
(1,800) |
|
Impairment of long-lived assets |
104 |
139 |
|
Net profit on sale of fixed assets |
(25) |
(115) |
|
Non-recurring transitional service agreement costs |
- |
482 |
|
Contingent consideration remeasurement |
(504) |
(1,299) |
|
Acquisition related expenses |
1101 |
14,313 |
|
Adjusted EBITDA |
$ 38,635 |
$ 43,132 |
|
POWERFLEET, INC, AND MiX TELEMATICS Condensed Consolidated Statements of Operations (In thousands, except per share data) |
||||
|
Three Months Ended June 30, 2023 |
||||
|
Powerfleet Inc |
MiX Telematics |
Adjustments to |
Pro Forma |
|
|
Revenues: |
||||
|
Products |
$ 11,084 |
$ 4,140 |
$ (701) |
$ 14,523 |
|
Services |
21,008 |
32,211 |
701 |
53,920 |
|
Total revenues |
32,092 |
36,351 |
- |
68,443 |
|
Cost of revenues: |
||||
|
Cost of products |
8,550 |
3,025 |
(644) |
10,931 |
|
Cost of services |
7,524 |
10,213 |
644 |
18,381 |
|
Total cost of revenues |
16,074 |
13,238 |
- |
29,312 |
|
Gross profit |
16,018 |
23,113 |
- |
39,131 |
|
Operating expenses: |
||||
|
Selling, general and administrative expenses |
17,198 |
17,377 |
- |
34,575 |
|
Research and development expenses |
2,221 |
1,344 |
- |
3,565 |
|
Total operating expenses |
19,419 |
18,721 |
- |
38,140 |
|
(Loss)/gain from operations |
(3,401) |
4,392 |
- |
991 |
|
Interest income |
22 |
269 |
- |
291 |
|
Interest expense |
(174) |
(502) |
- |
(676) |
|
Bargain purchase - Movingdots |
283 |
- |
- |
283 |
|
Other expense, net |
- |
(709) |
- |
(709) |
|
Net (loss)/gain before income taxes |
(3,270) |
3,450 |
- |
180 |
|
Income tax benefit/(expense) |
6 |
(1,842) |
- |
(1,836) |
|
Net (loss)/profit before non-controlling interest |
(3,264) |
1,608 |
- |
(1,656) |
|
Non-controlling interest |
(6) |
- |
- |
(6) |
|
Net (loss)/profit |
(3,270) |
1,608 |
- |
(1,662) |
|
Accretion of preferred stock |
(1,772) |
- |
- |
(1,772) |
|
Preferred stock dividend |
(1,128) |
- |
- |
(1,128) |
|
Net (loss)/profit attributable to common stockholders |
$ (6,170) |
$ 1,608 |
$ - |
$ (4,562) |
|
Net (loss)/profit per share attributable to |
$ (0.17) |
$ 0.02 |
$ (0.04) |
|
|
Weighted average common shares outstanding - |
35,605 |
70,785 |
106,390 |
|
POWERFLEET, INC, AND MiX TELEMATICS Condensed Consolidated Balance Sheets (In thousands) |
|||
|
March 31, 2024 |
|||
|
Powerfleet Inc |
MiX Telematics |
Pro Forma |
|
|
ASSETS |
|||
|
Current assets: |
|||
|
Cash and cash equivalents |
$ 24,354 |
$ 26,737 |
$ 51,091 |
|
Restricted cash |
85,310 |
794 |
86,104 |
|
Accounts receivables |
30,333 |
24,675 |
55,008 |
|
Inventory, net |
21,658 |
4,142 |
25,800 |
|
Deferred costs - current |
42 |
- |
42 |
|
Prepaid expenses and other current assets |
8,091 |
9,693 |
17,784 |
|
Total current assets |
169,788 |
66,041 |
235,829 |
|
Fixed assets, net |
12,719 |
35,587 |
48,306 |
|
Goodwill |
83,487 |
38,226 |
121,713 |
|
Intangible assets, net |
19,652 |
20,792 |
40,444 |
|
Right-of-use asset |
7,428 |
3,794 |
11,222 |
|
Severance payable fund |
3,796 |
- |
3,796 |
|
Deferred tax asset |
2,781 |
1,093 |
3,874 |
|
Other assets |
9,029 |
10,061 |
19,090 |
|
Total assets |
$ 308,680 |
$ 175,594 |
$ 484,274 |
|
LIABILITIES |
|||
|
Current liabilities: |
|||
|
Short-term bank debt and current maturities of long-term debt |
$ 1,951 |
$ 20,158 |
$ 22,109 |
|
Accounts payable and accrued expenses |
34,008 |
26,755 |
60,763 |
|
Deferred revenue - current |
5,842 |
6,394 |
12,236 |
|
Lease liability - current |
1,789 |
859 |
2,648 |
|
Total current liabilities |
43,590 |
54,166 |
97,756 |
|
Long-term debt - less current maturities |
113,810 |
- |
113,810 |
|
Deferred revenue - less current portion |
4,892 |
- |
4,892 |
|
Lease liability - less current portion |
5,921 |
2,852 |
8,773 |
|
Accrued severance payable |
4,597 |
- |
4,597 |
|
Deferred tax liability |
4,465 |
14,204 |
18,669 |
|
Other long-term liabilities |
2,496 |
484 |
2,980 |
|
Total liabilities |
179,771 |
71,706 |
251,477 |
|
Convertible redeemable preferred stock: |
90,273 |
- |
90,273 |
|
STOCKHOLDERS' EQUITY |
|||
|
Preferred stock |
- |
- |
- |
|
Common stock |
387 |
63,455 |
63,842 |
|
Additional paid-in capital |
202,607 |
(2,389) |
200,218 |
|
Accumulated deficit |
(154,796) |
76,280 |
(78,516) |
|
Accumulated other comprehensive loss |
(985) |
(16,148) |
(17,133) |
|
Treasury stock |
(8,682) |
(17,315) |
(25,997) |
|
Total stockholders' equity |
38,531 |
103,883 |
142,414 |
|
Non-controlling interest |
105 |
5 |
110 |
|
Total equity |
38,636 |
103,888 |
142,524 |
|
Total liabilities, convertible redeemable preferred stock, |
$ 308,680 |
$ 175,594 |
$ 484,274 |
|
POWERFLEET INC, AND MiX TELEMATICS Condensed Consolidated Statements of Cash Flows (In thousands) |
|||
|
Three Months Ended June 30, 2023 |
|||
|
Powerfleet |
MiX |
Pro Forma |
|
|
Cash flows from operating activities |
|||
|
Net loss |
$ (3,270) |
$ 1,608 |
$ (1,662) |
|
Adjustments to reconcile net loss to cash used in operating activities: |
$ - |
||
|
Non-controlling interest |
6 |
- |
6 |
|
Gain on bargain purchase |
(283) |
- |
(283) |
|
Inventory reserve |
373 |
70 |
443 |
|
Stock based compensation expense |
852 |
240 |
1,092 |
|
Depreciation and amortization |
2,322 |
4,012 |
6,334 |
|
Right-of-use assets, non-cash lease expense |
660 |
- |
660 |
|
Bad debts expense |
598 |
818 |
1,416 |
|
Deferred income taxes |
(24) |
2,014 |
1,990 |
|
Other non-cash items |
29 |
1,731 |
1,760 |
|
Changes in operating assets and liabilities: |
- |
||
|
Accounts receivables |
(668) |
(3,340) |
(4,008) |
|
Inventories |
389 |
595 |
984 |
|
Prepaid expenses and other current assets |
344 |
(382) |
(38) |
|
Deferred costs |
185 |
(1,862) |
(1,677) |
|
Deferred revenue |
58 |
- |
58 |
|
Accounts payable and accrued expenses |
(1,466) |
(525) |
(1,991) |
|
Lease liabilities |
(650) |
- |
(650) |
|
Accrued severance payable, net |
88 |
- |
88 |
|
Net cash (used in)/provided by operating activities |
(457) |
4,979 |
4,522 |
|
Cash flows from investing activities |
|||
|
Capitalized software development costs |
(997) |
(1,355) |
(2,352) |
|
Capital expenditures |
(966) |
(3,616) |
(4,582) |
|
Net cash used in investing activities |
(1,963) |
(4,971) |
(6,934) |
|
Cash flows from financing activities |
|||
|
Repayment of long-term debt |
(1,329) |
(546) |
(1,875) |
|
Short-term bank debt, net |
2,737 |
63 |
2,800 |
|
Purchase of treasury stock upon vesting of restricted stock |
(4) |
- |
(4) |
|
Payment of preferred stock dividend and redemption of preferred stock |
(1,128) |
- |
(1,128) |
|
Proceeds from exercise of stock options, net |
36 |
- |
36 |
|
Cash paid on dividends to affiliates |
- |
(1,331) |
(1,331) |
|
Net cash from/(used in) financing activities |
312 |
(1,814) |
(1,502) |
|
Effect of foreign exchange rate changes on cash and cash equivalents |
(943) |
(987) |
(1,930) |
|
Net decrease in cash and cash equivalents, and restricted cash |
(3,051) |
(2,793) |
(5,844) |
|
Cash and cash equivalents, and restricted cash at beginning of the period |
25,089 |
30,657 |
55,746 |
|
Cash and cash equivalents, and restricted cash at end of the period |
$ 22,038 |
$ 27,864 |
$ 49,902 |
|
Reconciliation of cash, cash equivalents, and restricted cash, beginning of the |
|||
|
Cash and cash equivalents |
24,780 |
29,876 |
54,656 |
|
Restricted cash |
309 |
781 |
1,090 |
|
Cash, cash equivalents, and restricted cash, beginning of the period |
$ 25,089 |
$ 30,657 |
$ 55,746 |
|
Reconciliation of cash, cash equivalents, and restricted cash, end of the period |
|||
|
Cash and cash equivalents |
21,729 |
27,101 |
48,830 |
|
Restricted cash |
309 |
763 |
1,072 |
|
Cash, cash equivalents, and restricted cash, end of the period |
$ 22,038 |
$ 27,864 |
$ 49,902 |
|
Supplemental disclosure of cash flow information: |
|||
|
Cash paid for: |
|||
|
Taxes |
$ 101 |
$ 172 |
$ 273 |
|
Interest |
$ 238 |
$ 118 |
$ 356 |
|
Noncash investing and financing activities: |
|||
|
Common stock issued for transaction bonus |
$ - |
$ - |
$ - |
|
POWERFLEET INC, AND MiX TELEMATICS RECONCILIATION OF GAAP TO ADJUSTED EBITDA FINANCIAL MEASURES (In thousands) |
|||
|
Three Months Ended June 30, 2023 |
|||
|
Powerfleet Inc. |
MiX Telematics |
Pro Forma |
|
|
Net loss attributable to common stockholders |
$ (6,170) |
$ 1,608 |
$ (4,562) |
|
Non-controlling interest |
6 |
- |
6 |
|
Preferred stock dividend and accretion |
2,901 |
- |
2,901 |
|
Interest expense, net |
457 |
233 |
690 |
|
Income tax (benefit)/expense |
(6) |
1,842 |
1,836 |
|
Depreciation and amortization |
2,322 |
4,012 |
6,334 |
|
Stock-based compensation |
852 |
240 |
1,092 |
|
Foreign Currency Translation |
(362) |
730 |
368 |
|
Restructuring Related Expenses |
425 |
23 |
448 |
|
Gain on Bargain purchase - Movingdots |
(283) |
- |
(283) |
|
Net profit on sale of fixed assets |
- |
(4) |
(4) |
|
Contingent consideration remeasurement |
- |
(24) |
(24) |
|
Acquisition related expenses |
223 |
0 |
223 |
|
Adjusted EBITDA |
$ 365 |
$ 8,660 |
$ 9,025 |
|
POWERFLEET, INC. AND MIX TELEMATICS RECONCILIATION OF GAAP TO NON-GAAP NET INCOME (LOSS) FINANCIAL MEASURES (In thousands) |
|||
|
Three Months Ended June 30, 2023 |
|||
|
Powerfleet Inc. |
MiX Telematics |
Pro Forma |
|
|
Net (loss)/income |
$ (3,270) |
$ 1,608 |
$ (1,662) |
|
Foreign currency translation |
(362) |
730 |
368 |
|
Income tax effect of net foreign exchange (losses)/gains |
- |
425 |
425 |
|
Restructuring related expenses |
425 |
23 |
448 |
|
Income tax effect of restructuring costs |
- |
(5) |
(5) |
|
Acquisition related expenses |
223 |
- |
223 |
|
Non-GAAP net (loss)/income |
$ (2,984) |
$ 2,781 |
$ (203) |
|
Weighted average shares outstanding |
35,605 |
70,785 |
106,390 |
|
Non-GAAP net (loss)/income per share - basic |
$ (0.084) |
$ 0.039 |
$ (0.002) |
|
POWERFLEET, INC, AND MiX TELEMATICS Condensed Consolidated Statements of Operations (In thousands, except per share data) |
||||
|
Year Ended March 31, 2023 |
||||
|
Powerfleet Inc |
MiX Telematics |
Adjustments to |
Pro Forma |
|
|
Revenues: |
||||
|
Products |
$ 54,934 |
$ 18,337 |
$ (2,874) |
$ 70,397 |
|
Services |
80,542 |
126,656 |
2,874 |
210,072 |
|
Total revenues |
135,476 |
144,993 |
- |
280,469 |
|
Cost of revenues: |
||||
|
Cost of products |
39,660 |
14,054 |
(2,571) |
51,143 |
|
Cost of services |
28,842 |
40,073 |
2,571 |
71,486 |
|
Total cost of revenues |
68,502 |
54,127 |
- |
122,629 |
|
Gross profit |
66,974 |
90,866 |
- |
157,840 |
|
Operating expenses: |
||||
|
Selling, general and administrative expenses |
64,856 |
73,710 |
- |
138,566 |
|
Research and development expenses |
7,458 |
5,591 |
- |
13,049 |
|
Total operating expenses |
72,314 |
79,301 |
- |
151,615 |
|
(Loss)/income from operations |
(5,340) |
11,565 |
- |
6,225 |
|
Interest income |
82 |
1,159 |
- |
1,241 |
|
Interest expense |
757 |
(1,446) |
- |
(689) |
|
Bargain purchase - Movingdots |
7,234 |
- |
- |
7,234 |
|
Other income, net |
(67) |
1,689 |
- |
1,622 |
|
Net income before income taxes |
2,666 |
12,967 |
- |
15,633 |
|
Income tax expense |
(1,304) |
(8,445) |
- |
(9,749) |
|
Net loss before non-controlling interest |
1,362 |
4,522 |
- |
5,884 |
|
Non-controlling interest |
2 |
- |
- |
2 |
|
Net income |
1,364 |
4,522 |
- |
5,886 |
|
Accretion of preferred stock |
(6,210) |
- |
- |
(6,210) |
|
Preferred stock dividend |
(4,310) |
- |
- |
(4,310) |
|
Net (loss)/income attributable to common stockholders |
$ (9,156) |
$ 4,522 |
$ - |
$ (4,634) |
|
Net (loss)/income per share attributable to |
$ (0.26) |
$ 0.06 |
$ - |
$ (0.04) |
|
Weighted average common shares outstanding - |
35,548 |
70,525 |
- |
106,073 |
|
POWERFLEET, INC, AND MiX TELEMATICS Condensed Consolidated Statements of Operations (In thousands, except per share data) |
||||
|
Year Ended March 31, 2024 |
||||
|
Powerfleet Inc |
MiX Telematics |
Adjustments to |
Pro Forma |
|
|
Revenues: |
||||
|
Products |
$ 49,313 |
$ 21,600 |
$ (3,248) |
$ 67,665 |
|
Services |
85,311 |
130,680 |
3,248 |
219,239 |
|
Total revenues |
134,624 |
152,280 |
- |
286,904 |
|
Cost of revenues: |
||||
|
Cost of products |
36,916 |
14,628 |
(3,228) |
48,316 |
|
Cost of services |
31,003 |
45,405 |
3,228 |
79,636 |
|
Total cost of revenues |
67,919 |
60,033 |
- |
127,952 |
|
Gross profit |
66,705 |
92,247 |
- |
158,952 |
|
Operating expenses: |
||||
|
Selling, general and administrative expenses |
76,144 |
75,695 |
- |
151,839 |
|
Research and development expenses |
8,675 |
6,118 |
- |
14,793 |
|
Total operating expenses |
84,819 |
81,813 |
- |
166,632 |
|
(Loss)/income from operations |
(18,114) |
10,434 |
- |
(7,680) |
|
Interest income |
338 |
1,142 |
- |
1,480 |
|
Interest expense |
(2,174) |
(2,347) |
- |
(4,521) |
|
Bargain purchase - Movingdots |
1,800 |
- |
- |
1,800 |
|
Other income, net |
(87) |
(179) |
- |
(266) |
|
Net (loss)/income before income taxes |
(18,237) |
9,050 |
- |
(9,187) |
|
Income tax expense |
(549) |
(6,465) |
- |
(7,014) |
|
Net (loss)/income before non-controlling interest |
(18,786) |
2,585 |
- |
(16,201) |
|
Non-controlling interest |
(50) |
- |
- |
(50) |
|
Net (loss)/income |
(18,836) |
2,585 |
- |
(16,251) |
|
Accretion of preferred stock |
(15,480) |
- |
- |
(15,480) |
|
Preferred stock dividend |
(4,514) |
- |
- |
(4,514) |
|
Net (loss)/income attributable to common stockholders |
$ (38,830) |
$ 2,585 |
$ - |
$ (36,245) |
|
Net (loss)/income per share attributable to |
$ (1.08) |
$ 0.04 |
$ (0.34) |
|
|
Weighted average common shares outstanding - |
35,813 |
71,081 |
106,894 |
|
POWERFLEET INC, AND MiX TELEMATICS RECONCILIATION OF GAAP TO ADJUSTED EBITDA FINANCIAL MEASURES (In thousands) |
|||
|
Year Ended March 31, 2023 |
|||
|
Powerfleet Inc. |
MiX Telematics |
Pro Forma |
|
|
Net loss attributable to common stockholders |
$ (9,156) |
$ 4,522 |
$ (4,634) |
|
Non-controlling interest |
(2) |
- |
(2) |
|
Preferred stock dividend and accretion |
10,520 |
- |
10,520 |
|
Interest expense, net |
660 |
287 |
947 |
|
Other expense, net |
67 |
- |
67 |
|
Income tax expense |
1,304 |
8,445 |
9,749 |
|
Depreciation and amortization |
8,463 |
15,609 |
24,072 |
|
Stock-based compensation |
4,718 |
502 |
5,220 |
|
Foreign Currency Translation |
(2,081) |
(1,110) |
(3,191) |
|
Restructuring Related Expenses |
1,423 |
1,022 |
2,445 |
|
Gain on Bargain purchase - Movingdots |
(7,234) |
- |
(7,234) |
|
Impairment of long-lived assets |
- |
104 |
104 |
|
Net profit on sale of fixed assets |
- |
(25) |
(25) |
|
Contingent consideration remeasurement |
- |
(504) |
(504) |
|
Acquisition related expenses |
317 |
784 |
1,101 |
|
Adjusted EBITDA |
$ 8,999 |
$ 29,636 |
$ 38,635 |
|
Year Ended March 31, 2024 |
|||
|
Powerfleet Inc. |
MiX Telematics |
Pro Forma |
|
|
Net loss attributable to common stockholders |
$ (38,830) |
$ 2,585 |
$ (36,245) |
|
Non-controlling interest |
49 |
- |
49 |
|
Preferred stock dividend and accretion |
19,995 |
- |
19,995 |
|
Interest expense, net |
1,987 |
1,205 |
3,192 |
|
Other expense, net |
87 |
- |
87 |
|
Income tax expense |
549 |
6,465 |
7,014 |
|
Depreciation and amortization |
9,098 |
20,450 |
29,548 |
|
Stock-based compensation |
4,104 |
1,110 |
5,214 |
|
Foreign Currency Translation |
(248) |
1,741 |
1,493 |
|
Restructuring Related Expenses |
1,035 |
30 |
1,065 |
|
Gain on Bargain purchase - Movingdots |
(1,800) |
- |
(1,800) |
|
Impairment of long-lived assets |
- |
139 |
139 |
|
Net profit on sale of fixed assets |
- |
(115) |
(115) |
|
Non-recurring transitional service agreement costs |
- |
482 |
482 |
|
Contingent consideration remeasurement |
- |
(1,299) |
(1,299) |
|
Acquisition related expenses |
11218 |
3095 |
14,313 |
|
Adjusted EBITDA |
$ 7,244 |
$ 35,888 |
$ 43,132 |
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SOURCE Powerfleet
Released August 22, 2024