Sacks Parente Golf, Inc. Reports Second Quarter 2024 Financial Results and Provides Corporate Update
Camarillo, Calif., Aug. 05, 2024 (GLOBE NEWSWIRE) -- Sacks Parente Golf, Inc. (NASDAQ:SPGC), (the "Company" or "Sacks Parente"), a technology-forward golf company with a growing portfolio of golf products, including putters, golf shafts, golf grips, and other golf-related accessories, reports its financial results for its fiscal second quarter ended June 30, 2024 and provides a business update.
Financial Highlights
- Revenue of $813,000 in 2Q24 increased 132% sequentially from $350,000 in 1Q24
- Gross margin of 60% in 2Q24 and for the six months ended June 30, 2024 was driven by sales of higher-margin Newton shafts that accounted for approximately 80% of the Company's revenue over the first two quarters of 2024
- Significant increase in orders received from Club Champion during the 2Q24
Recent Corporate Highlights
- Introduced a Weekly Driver Performance Pool program for players on the PGA TOUR Champions that use the Company's Newton Motion driver shafts in tournaments
- Expanded the Newton Golf Shaft division with the addition of the Newton Motion Fairway Wood shaft to complement the initial Newton Motion Driver shaft
"Brand recognition and sales of our Newton Motion replacement shafts surged in the second quarter and has continued into the third quarter. Revenue more than doubled in the second quarter from the first quarter thanks to this product momentum in the Newton segment, and we currently see revenue accelerating sequentially in the third quarter," commented Greg Campbell, Sacks Parente's Executive Chairman. "Our advertising efforts continue to pay off handsomely, and we are seeing more momentum for our Newton driver shaft among the players on the PGA TOUR Champions. These are competitive professionals who recognize and appreciate superior products, so it is gratifying to know that our engineering and product development have hit the mark with this very elite group. It is also rewarding to receive similarly positive feedback from ‘weekend golfers' with regard to how Newton Motion shafts have added distance and control to their game. We look forward to additional revenue growth and brand building in the third quarter."
About Sacks Parente Golf
Sacks Parente Golf, Inc. serves as the parent entity of technology-forward golf companies that help golfers elevate their game. With a growing portfolio of golf products, including putters, golf shafts, golf grips, and other golf-related accessories, the Company's innovative accomplishments include: the First Vernier Acuity putter, patented Ultra-Low Balance Point (ULBP) putter technology, weight-forward Center-of-Gravity (CG) design, and pioneering ultra-light carbon fiber putter shafts.
In consideration of its growth opportunities in golf shaft technologies, the Company expanded its manufacturing business in April of 2022 to develop the advanced Newton brand of premium golf shafts by opening a new shaft manufacturing facility in St. Joseph, MO. It is the Company's intent to manufacture and assemble substantially all products in the United States, while also expanding into golf apparel and other golf-related product lines to enhance its growth.
The Company's future expansions may include broadening its offerings through mergers, acquisitions or internal developments of product lines that are complementary to its premium brand. The Company currently sells its products through resellers, the Company's websites, Club Champion retail stores, and distributors in the United States, China, Japan, and South Korea. For more information, please visit the Company's website at https://sacksparente.com/. Additional social media: @sacksparentegolf @newtonshafts
Forward Looking Statements
This press release contains statements that constitute "forward-looking statements," including with respect to the proposed initial public offering and the anticipated use of the net proceeds. No assurance can be given that the offering discussed above will be completed on the terms described, or at all, or that the net proceeds of the offering will be used as indicated. Forward-looking statements are subject to numerous conditions, many of which are beyond the control of the Company, including those set forth in the Risk Factors section of the Company's registration statement and preliminary prospectus for the Company's offering filed with the SEC. Copies of these documents are available on the SEC's website, www.sec.gov. The Company undertakes no obligation to update these statements for revisions or changes after the date of this release, except as required by law.
Contacts:
Company:
Steve Handy, CFO
Sacks Parente Golf, Inc.
Email: [email protected]
www.sacksparente.com
Investor Relations:
CORE IR
Email: [email protected]
Phone: (516) 222-2560
SACKS PARENTE GOLF, INC.
CONDENSED BALANCE SHEETS
(Amounts rounded to nearest thousands, except share amounts)
| June 30, 2024 | December 31, 2023 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | $ | 2,786,000 | $ | 5,338,000 | ||||
| Accounts receivable | 157,000 | 53,000 | ||||||
| Inventory, net of reserve for obsolescence of $51,000 and $98,000, respectively | 477,000 | 248,000 | ||||||
| Prepaid expenses and other current assets | 171,000 | 196,000 | ||||||
| Total Current Assets | 3,591,000 | 5,835,000 | ||||||
| Property and equipment, net | 504,000 | 379,000 | ||||||
| Right-of-use asset, net | 50,000 | 65,000 | ||||||
| Software licensing agreement, net | 76,000 | 110,000 | ||||||
| Deposits | 5,000 | 5,000 | ||||||
| Total Assets | $ | 4,226,000 | $ | 6,394,000 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable and accrued expenses | $ | 437,000 | $ | 401,000 | ||||
| Lease liability, current | 32,000 | 31,000 | ||||||
| Software licensing obligation, current | 54,000 | 41,000 | ||||||
| Customer deposits | - | 2,000 | ||||||
| Total Current Liabilities | 523,000 | 475,000 | ||||||
| Software licensing fee obligation, net of current | 59,000 | 95,000 | ||||||
| Lease liability, net of current | 17,000 | 34,000 | ||||||
| Total Liabilities | 599,000 | 604,000 | ||||||
| Commitments and Contingencies | ||||||||
| Stockholders' Equity: | ||||||||
| Preferred stock $.01 par value, 5,000,000 shares authorized, no shares issued and outstanding | - | - | ||||||
| Common stock, $.01 par value, 45,000,000 shares authorized, 1,459,587 and 1,459,587, shares issued and outstanding, respectively | 15,000 | 15,000 | ||||||
| Additional paid-in-capital | 16,277,000 | 16,092,000 | ||||||
| Accumulated deficit | (12,665,000 | ) | (10,317,000 | ) | ||||
| Total Stockholders' Equity | 3,627,000 | 5,790,000 | ||||||
| Total Liabilities and Stockholders' Equity | $ | 4,226,000 | $ | 6,394,000 | ||||
SACKS PARENTE GOLF, INC.
CONDENSED STATEMENTS OF OPERATIONS
For the Three and Six Months Ended June 30, 2024 and 2023
(Unaudited)
(Amounts rounded to nearest thousands, except share amounts)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Net Sales | $ | 813,000 | $ | 47,000 | $ | 1,163,000 | $ | 137,000 | ||||||||
| Cost of goods sold | 324,000 | 32,000 | 468,000 | 78,000 | ||||||||||||
| Gross profit | 489,000 | 15,000 | 695,000 | 59,000 | ||||||||||||
| Operating expenses | ||||||||||||||||
| Selling, general and administrative expenses | 1,484,000 | 647,000 | 2,755,000 | 1,563,000 | ||||||||||||
| Research and development | 207,000 | 18,000 | 397,000 | 43,000 | ||||||||||||
| Total operating expenses | 1,691,000 | 665,000 | 3,152,000 | 1,606,000 | ||||||||||||
| Loss from operations | (1,202,000 | ) | (650,000 | ) | (2,457,000 | ) | (1,547,000 | ) | ||||||||
| Interest income (expense), net | 47,000 | (22,000 | ) | 109,000 | (42,000 | ) | ||||||||||
| Net loss | $ | (1,155,000 | ) | $ | (672,000 | ) | $ | (2,348,000 | ) | $ | (1,589,000 | ) | ||||
| Net loss per share – basic and diluted | $ | (0.79 | ) | $ | (0.62 | ) | $ | (1.61 | ) | $ | (1.47 | ) | ||||
| Weighted average common shares outstanding – basic and diluted | 1,459,587 | 1,083,450 | 1,459,587 | 1,081,654 | ||||||||||||
The accompanying notes are an integral part of these financial statements.
SACKS PARENTE GOLF, INC.
CONDENSED STATEMENTS OF CASH FLOWS
For the Six Months Ended June 30, 2024 and 2023
(Unaudited)
(Amounts rounded to nearest thousands)
| Six Months Ended June 30, | |||||||||||||
| 2024 | 2023 | ||||||||||||
| Cash Flows from Operating Activities | |||||||||||||
| Net Loss | $ | (2,348,000 | ) | $ | (1,589,000 | ) | |||||||
| Adjustments to reconcile net loss to net cash used in operating activities: | |||||||||||||
| Depreciation | 63,000 | 10,000 | |||||||||||
| Amortization of deferred software licensing agreement | 34,000 | - | |||||||||||
| Change in reserve for inventory obsolescence | (47,000 | ) | 25,000 | ||||||||||
| Vesting of options | 185,000 | 227,000 | |||||||||||
| Shares issued for services | - | 225,000 | |||||||||||
| Changes in ROU asset | 15,000 | 15,000 | |||||||||||
| Accrued interest | - | 42,000 | |||||||||||
| Changes in operating assets and liabilities | |||||||||||||
| Accounts receivable | (104,000 | ) | (6,000 | ) | |||||||||
| Inventory | (182,000 | ) | 22,000 | ||||||||||
| Prepaids and other current assets | 25,000 | 13,000 | |||||||||||
| Accounts payable and accrued expenses | 36,000 | 67,000 | |||||||||||
| Accrued payroll to officers | - | 653,000 | |||||||||||
| Lease liability | (16,000 | ) | (17,000 | ) | |||||||||
| Customer deposits | (2,000 | ) | - | ||||||||||
| Net cash used in operating activities | (2,341,000 | ) | (313,000 | ) | |||||||||
| Cash Flows from Investing Activities | |||||||||||||
| Purchase of property and equipment | (188,000 | ) | (3,000 | ) | |||||||||
| Net cash used in investing activities | (188,000 | ) | (3,000 | ) | |||||||||
| Cash Flows from Financing Activities | |||||||||||||
| Software licensing obligation | (23,000 | ) | - | ||||||||||
| Payment of equipment purchase obligation | - | (15,000 | ) | ||||||||||
| Deferred offering costs | - | (11,000 | ) | ||||||||||
| Proceeds from private sale of common stock subject to possible redemption | - | 180,000 | |||||||||||
| Net cash provided by financing activities | (23,000 | ) | 154,000 | ||||||||||
| Net decrease in cash | (2,552,000 | ) | (162,000 | ) | |||||||||
| Cash and restricted cash beginning of period | 5,338,000 | 171,000 | |||||||||||
| Cash and restricted cash end of period | $ | 2,786,000 | $ | 9,000 | |||||||||
| Supplemental disclosures of cash flow information: | |||||||||||||
| Cash paid for interest | $ | - | $ | - | |||||||||
| Cash paid for income taxes | $ | - | $ | - | |||||||||
| SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | |||||||||||||
| Accrued deferred offering costs | $ | - | $ | 177,000 | |||||||||
| New right of use asset and lease liability | $ | - | $ | 43,000 | |||||||||
