Polar Power Reports Second Quarter 2024 Financial Results
Swing to Quarterly Profit Led by Higher Net Sales
GARDENA, CA, Aug. 14, 2024 (GLOBE NEWSWIRE) -- Polar Power, Inc. ("Polar Power" or the "Company") (NASDAQ:POLA), a global provider of prime, backup, and solar hybrid DC power solutions, reports its financial results for the second quarter of 2024.
Q2 2024 Financial Highlights
- Net sales were $4.6 million, a sequential improvement of 163% compared to $1.8 million in the first quarter of 2024, and compared to $5.6 million in the same period in 2023
- The company's gross margin improved to 39.3% compared to 26.4%, due in part to higher international sales
- Operating expenses were $1.4 million, slightly lower compared to $1.6 million in the first quarter of 2024, and compared to $1.8 million in the same period in 2023
- Net income was $501,000, or $0.03 per basic and diluted share, compared to a net loss of $(436,000), or $(0.03) per basic and diluted share in the same period in 2023
- Working capital of $10.1 million as of June 30, 2024, including $15.8 million in inventory
- Backlog at June 30, 2024 was $5.7 million, which includes $2.0 million in new bookings during the second quarter of 2024
Corporate Highlights:
- Appointed Mike Field as new Director and Compensation Committee Chairman
- Received approximately $3.0 million in tax refunds and Employee Retention Credits applied for in prior years
Arthur Sams, CEO of Polar Power, commented, "Our financial results in the second quarter are a welcome improvement over the first quarter of the year. We have seen a reversion to more normalized order levels from our top telco customers throughout the year, with more consistent bookings that started in the back half of 2023, leading to higher sales in the current quarter, and a backlog that remains above $5 million. A positive swing in the bottom line of approximately $2.6 million compared to the prior quarter resulted in a profit of roughly $500,000, which importantly marks our first profitable quarter in over two years.
"International sales represented approximately 20% of our second quarter revenues, highlighting a steady geographic diversification in our sales. Also, during the quarter, our gross margins improved due to utilization of inventory in products shipped to telecom customers, including both DC backup power systems and solar hybrid power systems to international customers in Asia and elsewhere. We believe increased revenues combined with utilization of inventory will provide improved profits as we continue to see market conditions improve in our core telecom market."
"We also appointed a new director to our Board, Michael Field, and we welcome him to the team and look forward to benefitting from his sales, operational, and leadership experience," concluded Mr. Sams.
About Polar Power, Inc.
Polar Power (NASDAQ:POLA) is pioneering technological changes that radically change the production, consumption, and environmental impact of power generation and is a leading provider of DC advanced power and cooling systems, pioneering innovations across diverse industrial applications. Its product portfolio, known for innovation, durability, and efficiency, presently includes standard products for telecom, military, renewable energy, marine, automotive, residential, commercial, oil field and mining applications. Polar Power's systems can be configured to operate on any energy source including photovoltaics, diesel, LPG (propane and butane), and renewable fuels.
Polar Power's telecom power solutions offer significant cost savings with installation, permitting, site leases, and operation. Its military solutions provide compact, lightweight, fuel efficient, reliable power solutions for robotics, drone, communications, hybrid propulsion, and other applications. Its mobile rapid battery charging technology enables on-demand roadside charging for electric vehicles. Its combined heat and power (CHP) residential systems offer innovative vehicle charging and integrated home power systems via natural gas or propane feedstocks, optimizing performance and system costs. Polar Power's micro / nano grid solutions provide lower cost energy in "bad-grid or no-grid" environments. Its commitment to technological advancement extends to hybrid propulsion systems for marine and specialty vehicles, ensuring efficiency, comfort, reliability, and cost savings.
For more information, please visit www.polarpower.com. or follow us on www.linkedin.com/company/polar-power-inc/.
Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
This news release contains certain statements of a forward-looking nature relating to future events or future business performance. Forward-looking statements can be identified by the words "expects," "anticipates," "believes," "intends," "estimates," "plans," "will," "outlook" and similar expressions. Forward-looking statements are based on management's current plans, estimates, assumptions and projections, and speak only as of the date they are made. With the exception of historical information, the matters discussed in this press release including, without limitation, Polar Power's belief that orders from its telecom customers will continue to materialize; Polar Power's expectations that its planned investment in sales and marketing will accelerate sales growth, and managing operating expenses should enable both top- and bottom-line improvements throughout 2024 are forward-looking statements and considerations that involve a number of risks and uncertainties. The actual future results of Polar Power could differ from those statements. Factors that could cause or contribute to such differences include, but are not limited to, adverse domestic and foreign economic and market conditions, including demand for its Summit Series, 27 kW DC generator product line; trade tariffs on raw materials; changes in domestic and foreign governmental regulations and policies; the impact of inflation and changing prices on raw materials; supply chain constraints causing significant delays in sourcing raw materials; labor shortages as a result of the pandemic, low unemployment rates, or other factors limiting the availability of qualified workers; and other events, factors and risks. It undertakes no obligation to update any forward-looking statement in light of new information or future events, except as otherwise required by law. Forward-looking statements involve inherent risks and uncertainties, most of which are difficult to predict and are generally beyond Polar Power's control. Actual results or outcomes may differ materially from those implied by the forward-looking statements as a result of the impact of a number of factors, many of which are discussed in more detail in Polar Power's reports filed with the Securities and Exchange Commission.
Media and Investor Relations:
CoreIR
Peter Seltzberg, SVP Investor Relations and Corporate Advisory
+1 212-655-0924
[email protected]
www.CoreIR.com
Company Contact:
Polar Power, Inc.
249 E. Gardena Blvd.
Gardena, CA 90248
Tel: 310-830-9153
[email protected]
www.polarpower.com
POLAR POWER, INC.
CONDENSED BALANCE SHEETS
(in thousands, except share and per share data)
| June 30, 2024 | December 31, 2023 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 1,119 | $ | 549 | ||||
| Accounts receivable | 2,310 | 1,676 | ||||||
| Inventories | 15,776 | 16,522 | ||||||
| Prepaid expenses | 387 | 455 | ||||||
| Employee retention credit receivable | — | 2,000 | ||||||
| Income taxes receivable | — | 787 | ||||||
| Total current assets | 19,592 | 21,989 | ||||||
| Other assets: | ||||||||
| Operating lease right-of-use assets, net | 2,239 | 2,818 | ||||||
| Property and equipment, net | 241 | 344 | ||||||
| Deposits | 108 | 108 | ||||||
| Total assets | $ | 22,180 | $ | 25,259 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | 597 | $ | 1,762 | ||||
| Customer deposits | 1,469 | 1,618 | ||||||
| Accrued liabilities and other current liabilities | 1,156 | 1,151 | ||||||
| Line of credit | 4,683 | 4,238 | ||||||
| Notes payable-related party, current portion | 258 | 257 | ||||||
| Notes payable, current portion | 16 | 64 | ||||||
| Operating lease liabilities, current portion | 1,260 | 1,124 | ||||||
| Total current liabilities | 9,439 | 10,214 | ||||||
| Operating lease liabilities, net of current portion | 1,193 | 1,856 | ||||||
| Total liabilities | 10,632 | 12,070 | ||||||
| Commitments and Contingencies | ||||||||
| Stockholders' Equity | ||||||||
| Preferred stock, $0.0001 par value, 5,000,000 shares authorized, no shares issued and outstanding | — | — | ||||||
| Common stock, $0.0001 par value, 50,000,000 shares authorized, 17,579,089 shares issued and 17,561,612 shares outstanding on June 30, 2024, and December 31, 2023 | 2 | 2 | ||||||
| Additional paid-in capital | 38,886 | 38,886 | ||||||
| Accumulated deficit | (27,300 | ) | (25,659 | ) | ||||
| Treasury Stock, at cost (17,477 shares) | (40 | ) | (40 | ) | ||||
| Total stockholders' equity | 11,548 | 13,189 | ||||||
| Total liabilities and stockholders' equity | $ | 22,180 | $ | 25,259 | ||||
POLAR POWER, INC.
UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Net Sales | $ | 4,660 | $ | 5,587 | $ | 6,434 | $ | 9,777 | ||||||||
| Cost of Sales | 2,828 | 4,112 | 5,005 | 7,548 | ||||||||||||
| Gross profit | 1,832 | 1,475 | 1,429 | 2,229 | ||||||||||||
| Operating Expenses | ||||||||||||||||
| Sales and marketing | 264 | 310 | 494 | 642 | ||||||||||||
| Research and development | 195 | 338 | 415 | 684 | ||||||||||||
| General and administrative | 913 | 1,137 | 2,040 | 2,248 | ||||||||||||
| Total operating expenses | 1,372 | 1,785 | 2,949 | 3,574 | ||||||||||||
| Income (loss) from operations | 460 | (310 | ) | (1,520 | ) | (1,345 | ) | |||||||||
| Other income (expenses) | ||||||||||||||||
| Interest expense and finance costs | (179 | ) | (126 | ) | (342 | ) | (204 | ) | ||||||||
| Interest Income | 220 | — | 221 | |||||||||||||
| Total other income (expenses), net | 41 | (126 | ) | (121 | ) | (204 | ) | |||||||||
| Net income (loss) | $ | 501 | $ | (436 | ) | $ | (1,641 | ) | $ | (1,549 | ) | |||||
| Net income (loss) per share – basic and diluted | $ | 0.03 | $ | (0.03 | ) | $ | (0.09 | ) | $ | (0.12 | ) | |||||
| Weighted average shares outstanding, basic and diluted | 17,561,612 | 12,949,550 | 17,561,612 | 12,949,550 | ||||||||||||
POLAR POWER, INC.
UNAUDITED CONDENSED STATEMENTS OF CASH FLOW
(in thousands)
| Six Months Ended June 30, | ||||||||
| 2024 | 2023 | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | (1,641 | ) | $ | (1,549 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation and amortization | 121 | 226 | ||||||
| Changes in operating assets and liabilities | ||||||||
| Accounts receivable | (634 | ) | (1,488 | ) | ||||
| Employee retention credit | 2,000 | — | ||||||
| Inventories | 746 | (2,229 | ) | |||||
| Prepaid expenses | 68 | 1,579 | ||||||
| Income tax receivable | 787 | — | ||||||
| Operating lease right-of-use asset | 579 | 454 | ||||||
| Accounts payable | (1,165 | ) | 1,199 | |||||
| Customer deposits | (149 | ) | (591 | ) | ||||
| Accrued expenses and other current liabilities | 5 | 11 | ||||||
| Operating lease liability | (527 | ) | (416 | ) | ||||
| Net cash provided by (used in) operating activities | 190 | (2,804 | ) | |||||
| Cash flows from investing activities: | ||||||||
| Acquisition of property and equipment | (18 | ) | (194 | ) | ||||
| Net cash used in investing activities | (18 | ) | (194 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Proceeds from advances from credit facility | 445 | 3,044 | ||||||
| Proceeds from notes payable, related party | — | 160 | ||||||
| Repayment of notes payable | (47 | ) | (125 | ) | ||||
| Net cash provided by financing activities | 398 | 3,079 | ||||||
| Increase in cash and cash equivalents | 570 | 81 | ||||||
| Cash and cash equivalents, beginning of period | 549 | 211 | ||||||
| Cash and cash equivalents, end of period | $ | 1,119 | $ | 292 | ||||
