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Cemtrex(CETX) - 2024 Q3 - Quarterly Report
CETXCemtrex(CETX)2024-08-14 20:25
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Financial Performance - Revenues for the three months ended June 30, 2024, were 14,686,398,aslightdecreasefrom14,686,398, a slight decrease from 14,730,140 for the same period in 2023, representing a decline of approximately 0.3%[5] - Gross profit for the nine months ended June 30, 2024, was 19,898,962,comparedto19,898,962, compared to 18,859,530 for the same period in 2023, reflecting an increase of about 5.5%[5] - Operating loss for the three months ended June 30, 2024, was (3,179,516),comparedtoanoperatingincomeof(3,179,516), compared to an operating income of 53,774 for the same period in 2023[5] - Net loss attributable to Cemtrex, Inc. stockholders for the three months ended June 30, 2024, was (8,981,026),comparedtoanetlossof(8,981,026), compared to a net loss of (1,146,524) for the same period in 2023[5] - The company reported a net loss before income taxes of (9,082,009)forthethreemonthsendedJune30,2024,comparedto(9,082,009) for the three months ended June 30, 2024, compared to (1,165,759) for the same period in 2023[5] - Total operating expenses for the nine months ended June 30, 2024, were 24,848,991,upfrom24,848,991, up from 20,352,319 for the same period in 2023, indicating an increase of approximately 22.3%[5] - Comprehensive loss attributable to Cemtrex, Inc. stockholders for the nine months ended June 30, 2024, was (12,478,586),comparedto(12,478,586), compared to (8,148,694) for the same period in 2023[6] - For the nine months ended June 30, 2024, the net loss was 12,012,943comparedtoanetlossof12,012,943 compared to a net loss of 8,048,022 for the same period in 2023, indicating a significant increase in losses[14] Assets and Liabilities - As of June 30, 2024, total current assets decreased to 26,405,347from26,405,347 from 29,293,041 as of September 30, 2023, representing a decline of approximately 9.8%[3] - Total liabilities rose to 43,474,220asofJune30,2024,comparedto43,474,220 as of June 30, 2024, compared to 40,109,950 as of September 30, 2023, indicating an increase of approximately 5.9%[3] - Long-term debt significantly increased to 16,893,184from16,893,184 from 9,929,348, reflecting a rise of approximately 70.5%[3] - The accumulated deficit grew to (75,787,626)asofJune30,2024,comparedto(75,787,626) as of June 30, 2024, compared to (64,125,895) as of September 30, 2023, marking an increase of about 18.2%[3] - Total stockholders' equity decreased to 47,956from47,956 from 7,687,614, a decline of approximately 99.4%[3] - The total assets decreased to 43,827,143from43,827,143 from 48,453,743, indicating a decline of approximately 9.3%[3] Cash Flow and Financing - Cash and cash equivalents increased to 6,468,197from6,468,197 from 5,329,910, showing a growth of about 21.4%[3] - Net cash used by operating activities for continuing operations was 2,076,477,animprovementfrom2,076,477, an improvement from 5,394,048 in the prior year[14] - The company’s cash flows from investing activities resulted in a net cash outflow of 406,224,comparedto406,224, compared to 735,265 in the previous year[14] - The company’s cash flows from financing activities provided a net cash inflow of 3,867,544,contrastingwithanetcashoutflowof3,867,544, contrasting with a net cash outflow of 1,280,991 in the prior year[14] - The company has secured a line of credit for its Vicon brand with available capacity of 2,269,675asofJune30,2024[28]−Thecompanyincurredcashpaidforinterestof2,269,675 as of June 30, 2024[28] - The company incurred cash paid for interest of 705,504 during the period, compared to 382,575intheprioryear[15]SegmentPerformance−TheCompany’sSecuritysegmentrevenuesdecreasedby382,575 in the prior year[15] Segment Performance - The Company’s Security segment revenues decreased by 2,821,792 or 31% to 6,193,487forthethreemonthsendedJune30,2024,comparedto6,193,487 for the three months ended June 30, 2024, compared to 9,015,279 for the same period in 2023[81] - The Industrial Services segment revenues increased by 2,778,050or492,778,050 or 49% to 8,492,911 for the three months ended June 30, 2024, compared to 5,714,861forthesameperiodin2023,drivenbyincreaseddemandandtheHeiseyacquisition[81]−SecuritysegmentrevenuesfortheninemonthsendedJune30,2024,decreasedby5,714,861 for the same period in 2023, driven by increased demand and the Heisey acquisition[81] - Security segment revenues for the nine months ended June 30, 2024, decreased by 2,487,701 or 10% to 23,446,220,attributedtoprojectdelaysandweakeningeconomicconditions[84]−IndustrialServicessegmentrevenuesfortheninemonthsendedJune30,2024,increasedby23,446,220, attributed to project delays and weakening economic conditions[84] - Industrial Services segment revenues for the nine months ended June 30, 2024, increased by 8,438,081 or 50% to 25,277,939,drivenbyincreaseddemandandtheHeiseyacquisition[84]ShareholderInformation−Thecompanyhas17,437,456sharesofcommonstockoutstandingasofAugust9,2024[1]−Theweightedaveragenumberofsharesforbasicanddilutedearningspersharewas31,346,628forthethreemonthsendedJune30,2024,comparedto897,897forthesameperiodin2023[5]−TheCompanyrepurchased71,951sharesfor25,277,939, driven by increased demand and the Heisey acquisition[84] Shareholder Information - The company has 17,437,456 shares of common stock outstanding as of August 9, 2024[1] - The weighted average number of shares for basic and diluted earnings per share was 31,346,628 for the three months ended June 30, 2024, compared to 897,897 for the same period in 2023[5] - The Company repurchased 71,951 shares for 69,705 under the Share Repurchase Program approved on August 22, 2023, with shares cancelled on April 8, 2024[25] - The Company raised approximately 10,035,293ingrossproceedsfromapublicofferingthatclosedonMay3,2024,selling11,764,705units[26]−TheCompanyfiledaCertificateofAmendmenttoincreaseauthorizedsharesofcommonstockfrom50,000,000to70,000,000onAugust2,2024[24]AccountingandCompliance−ThecompanyhasadoptedtheCECLmodelformeasuringcreditlosses,effectiveOctober1,2023,withnomaterialimpactonfinancialstatements[33]−Thecompanyisevaluatingtheimpactofrecentlyissuedaccountingstandards,includingASU2022−03andASU2023−07,onitsfinancialstatements[36]−TheCompanyreceivedanotificationfromNasdaqonJanuary26,2023,grantinganadditional180daystoregaincompliancewiththeminimumbidpricerequirement,whichwassettoexpireonJuly24,2023[23]−TheCompanyannouncedaspecialmeetingforSeries1PreferredStockshareholdersonDecember26,2023,toapproveareversestocksplit,butthemeetingwasadjournedduetoinsufficientvotes[23]−TheCompany’sSeries1PreferredStockwasdelistedfromNASDAQonJanuary22,2024,andisnowquotedontheOTCMarketsunderthesymbol"CETXP"[25]ResearchandDevelopment−ResearchanddevelopmentexpensesforthethreemonthsendedJune30,2024,were10,035,293 in gross proceeds from a public offering that closed on May 3, 2024, selling 11,764,705 units[26] - The Company filed a Certificate of Amendment to increase authorized shares of common stock from 50,000,000 to 70,000,000 on August 2, 2024[24] Accounting and Compliance - The company has adopted the CECL model for measuring credit losses, effective October 1, 2023, with no material impact on financial statements[33] - The company is evaluating the impact of recently issued accounting standards, including ASU 2022-03 and ASU 2023-07, on its financial statements[36] - The Company received a notification from Nasdaq on January 26, 2023, granting an additional 180 days to regain compliance with the minimum bid price requirement, which was set to expire on July 24, 2023[23] - The Company announced a special meeting for Series 1 Preferred Stock shareholders on December 26, 2023, to approve a reverse stock split, but the meeting was adjourned due to insufficient votes[23] - The Company’s Series 1 Preferred Stock was delisted from NASDAQ on January 22, 2024, and is now quoted on the OTC Markets under the symbol "CETXP"[25] Research and Development - Research and development expenses for the three months ended June 30, 2024, were 1,049,909, a decrease from 2,664,688forthesameperiodin2023[5]−ResearchandDevelopmentexpensesfortheninemonthsendedJune30,2024,were2,664,688 for the same period in 2023[5] - Research and Development expenses for the nine months ended June 30, 2024, were 2,664,688, a decrease of 1,231,029or321,231,029 or 32% compared to the same period in 2023[86] Other Financial Metrics - The company reported a loss per share of (1.36) for continuing operations, adjusted from a previously reported (1.29)forthesixmonthsendedJune30,2023[31]−ThecompanyreportedapretaxlossonthesaleofCemtrexAdvancedTechnologies,Inc.andCemtrexXR,Inc.of(1.29) for the six months ended June 30, 2023[31] - The company reported a pretax loss on the sale of Cemtrex Advanced Technologies, Inc. and Cemtrex XR, Inc. of (2,455,341)[38] - The company recognized 13,282and13,282 and 39,845 in amortization of discounted royalties for the three and nine months ended June 30, 2024, respectively[39] - The company has recognized share-based compensation expenses of 22,675forthethreemonthsendedJune30,2024,and22,675 for the three months ended June 30, 2024, and 93,313 for the nine months ended June 30, 2024[74]