Forward Reports Fiscal 2023 Third Quarter Results
HAUPPAUGE, N.Y., Aug. 14, 2023 (GLOBE NEWSWIRE) — Forward Industries, Inc. (NASDAQ:FORD), a global design, sourcing and distribution group, today announced financial results for its third quarter ended June 30, 2023.
Third Quarter Fiscal Year 2023 Financial Highlights
- Revenues were $10.1 million, a decrease of 4.7% from $10.6 million for the third quarter of fiscal year 2022.
- Gross margin declined to 18.0% compared to 18.1% for the third quarter of fiscal year 2022.
- Operating loss was $0.5 million compared to $0.4 million for the third quarter of fiscal year 2022.
- Basic and diluted loss per share was $0.05 compared to $0.04 for the third quarter of fiscal year 2022.
- Cash balance of $2.8 million at June 30, 2023 as compared to $2.6 million at September 30, 2022.
Terry Wise, Chief Executive Officer of Forward Industries, stated, “Pleasingly, the quarter witnessed the sustained positive momentum within our design division. However, this strong performance was offset by the continued difficulties within the retail and OEM sector. Consequently, after careful deliberation and consideration we have reluctantly resolved to discontinue our retail division in an orderly manner that will ensure we fulfil our commitments to our customers. This has been a pivotal quarter for the Company, one in which as a direct consequence of the decisions taken, we hope will result in profitability in the near future.”
The tables below are derived from the Company’s consolidated financial statements included in its Form 10-Q filed on August 14, 2023 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 June 30, 2023 and 2022. 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 optimism for improved performance in fiscal year 2023. 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, loss of additional customers, pricing pressures, lack of success of our sales people, supply chain issues, inability of our design division’s customers to pay for our services, unanticipated issues with our affiliated sourcing agent, and issues at Chinese factories that we source our products. 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, 2022 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 global design, sourcing and distribution group serving 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
For more information, contact:
Kathleen Weisberg, CFO, Forward Industries, Inc.
(631) 547-3055, kweisberg@forwardindustries.com
| FORWARD INDUSTRIES, INC. AND SUBSIDIARIES | ||||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||
| June 30, | September 30, | |||||||||
| 2023 | 2022 | |||||||||
| Assets | (Unaudited) | |||||||||
| Current assets: | ||||||||||
| Cash | $ | 2,821,163 | $ | 2,575,522 | ||||||
| Accounts receivable, net | 7,659,132 | 7,542,666 | ||||||||
| Inventories, net | 1,892,790 | 3,801,030 | ||||||||
| Prepaid expenses and other current assets | 689,955 | 417,605 | ||||||||
| Total current assets | 13,063,040 | 14,336,823 | ||||||||
| Property and equipment, net | 282,308 | 241,146 | ||||||||
| Intangible assets, net | 946,333 | 1,105,901 | ||||||||
| Goodwill | 1,758,682 | 1,758,682 | ||||||||
| Operating lease right-of-use assets, net | 3,124,871 | 3,427,726 | ||||||||
| Other assets | 68,737 | 68,737 | ||||||||
| Total assets | $ | 19,243,971 | $ | 20,939,015 | ||||||
| Liabilities and shareholders’ equity | ||||||||||
| Current liabilities: | ||||||||||
| Accounts payable | $ | 684,616 | $ | 268,160 | ||||||
| Due to Forward China | 7,948,249 | 7,713,880 | ||||||||
| Deferred income | 264,726 | 438,878 | ||||||||
| Current portion of earnout consideration | – | 25,000 | ||||||||
| Current portion of operating lease liability | 406,223 | 377,940 | ||||||||
| Accrued expenses and other current liabilities | 1,283,337 | 1,153,906 | ||||||||
| Total current liabilities | 10,587,151 | 9,977,764 | ||||||||
| Other liabilities: | ||||||||||
| Note payable to Forward China | 1,200,000 | 1,400,000 | ||||||||
| Operating lease liability, less current portion | 2,942,772 | 3,249,824 | ||||||||
| Earnout consideration, less current portion | 30,000 | 45,000 | ||||||||
| Total other liabilities | 4,172,772 | 4,694,824 | ||||||||
| Total liabilities | 14,759,923 | 14,672,588 | ||||||||
| 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 June 30, 2023 | ||||||||||
| and September 30, 2022 | 100,612 | 100,612 | ||||||||
| Additional paid-in capital | 20,171,299 | 20,115,711 | ||||||||
| Accumulated deficit | (15,787,863 | ) | (13,949,896 | ) | ||||||
| Total shareholders’ equity | 4,484,048 | 6,266,427 | ||||||||
| Total liabilities and shareholders’ equity | $ | 19,243,971 | $ | 20,939,015 | ||||||
| FORWARD INDUSTRIES, INC. AND SUBSIDIARIES | |||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||
| (UNAUDITED) | |||||||||||||||
| For the Three Months Ended June 30, | For the Nine Months Ended June 30, | ||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||
| Revenues, net | $ | 10,127,159 | $ | 10,588,835 | $ | 31,594,818 | $ | 32,517,139 | |||||||
| Cost of sales | 8,303,997 | 8,671,103 | 26,340,525 | 25,727,964 | |||||||||||
| Gross profit | 1,823,162 | 1,917,732 | 5,254,293 | 6,789,175 | |||||||||||
| Sales and marketing expenses | 711,472 | 664,484 | 2,175,081 | 2,106,263 | |||||||||||
| General and administrative expenses | 1,633,740 | 1,639,053 | 4,912,197 | 5,177,241 | |||||||||||
| Loss from operations | (522,050 | ) | (385,805 | ) | (1,832,985 | ) | (494,329 | ) | |||||||
| Fair value adjustment of earnout consideration | – | – | (40,000 | ) | – | ||||||||||
| Interest expense | 25,475 | 30,424 | 80,214 | 94,115 | |||||||||||
| Interest income | (10,489 | ) | – | (11,345 | ) | – | |||||||||
| Other (income)/expense, net | (292 | ) | 2,684 | (23,887 | ) | 6,780 | |||||||||
| Loss before income taxes | (536,744 | ) | (418,913 | ) | (1,837,967 | ) | (595,224 | ) | |||||||
| Provision for income taxes | – | – | – | – | |||||||||||
| Net loss | $ | (536,744 | ) | $ | (418,913 | ) | $ | (1,837,967 | ) | $ | (595,224 | ) | |||
| Loss per share: | |||||||||||||||
| Basic | $ | (0.05 | ) | $ | (0.04 | ) | $ | (0.18 | ) | $ | (0.06 | ) | |||
| Diluted | $ | (0.05 | ) | $ | (0.04 | ) | $ | (0.18 | ) | $ | (0.06 | ) | |||
| Weighted average common shares outstanding: | |||||||||||||||
| Basic | 10,061,185 | 10,061,185 | 10,061,185 | 10,061,185 | |||||||||||
| Diluted | 10,061,185 | 10,061,185 | 10,061,185 | 10,061,185 | |||||||||||
