Charge Enterprises Reports Second Quarter 2023 Financial Results

• Gross Profit grew 23% to $7.7 million, compared with the prior year period, driven by increases in the Infrastructure segment
• Second quarter revenues of $147.6 million; Infrastructure segment revenues increased 18%, compared with the prior year period
• Infrastructure segment backlog totaled $138.2 million at the close of the second quarter 2023
• Reaffirms expected positive Adjusted EBITDA in the first quarter 2024
• Recent acquisition of Greenspeed further solidifies the Company’s focus on establishing itself as a go-to resource for customers needing EV charging support

NEW YORK--(BUSINESS WIRE)-- Charge Enterprises, Inc. (Nasdaq: CRGE) (“Charge” or the “Company”), today reported second quarter 2023 results. For the quarter, revenues were $147.6 million, compared with $181.0 million in the second quarter of 2022. Gross profit for the second quarter of 2023 increased to $7.7 million, compared with $6.3 million in the second quarter of 2022.

“Charge’s second quarter revenue results were led by the strong performance from our Infrastructure segment, which includes our fast-growing Electric Vehicle (EV) charging infrastructure business. The 18% growth in revenues in our Infrastructure segment was offset by a decline in revenues in our Telecommunications segment, which experienced lower wholesale voice volume. The decline in revenues in the Telecommunications segment was expected to occur over time due to technology dynamics in voice calling. We have taken steps to mitigate this impact through new higher margin SMS text product offerings. Most importantly, we delivered on another significant milestone by achieving a second consecutive quarter of record Infrastructure segment backlog, reaching approximately $138 million at the end of the second quarter. We believe the continued increase in our customer commitments to engage Charge as their trusted resource in EV installations supports our long-term growth strategy for our Infrastructure segment. The expansion of our backlog also reflects the success we are experiencing in winning new automotive retail dealership customers nationwide," said Andrew Fox, Founder, Chairman and CEO.

"Our auto dealer customers' multi-year programs to install EV infrastructure is expected to continue to drive demand for our services and create recurring revenue opportunities with our remote monitoring and management software tool. At the end of the second quarter, we achieved nearly 20% of our goal of project engagement with 1,000 major market dealerships by 2025. Our recently announced acquisition of Greenspeed, a leading provider of EV infrastructure solutions, marks an important initiative for Charge that enhances our capabilities to both execute and service customers as the nation transitions to EVs. With Greenspeed’s skilled workforce, we have significantly strengthened our capabilities to serve clients directly, which is expected to enhance the quality of service and drive higher gross margin opportunities with our customer engagements. We believe that by leveraging Greenspeed’s success with retail dealerships and other channels, along with its scale and capacity, we can provide an even more compelling and complete suite of services to meet the high customer demand for EV infrastructure over the coming years.”

Fox added, “The strong demand for EV infrastructure, both from private and public sectors, is boosted by increasing government support for sustainable solutions, and auto OEM mandates for EV infrastructure deployments across dealer networks, creating very favorable market dynamics. We believe our robust growth in backlog, together with our strategic EV infrastructure acquisition, provides a positive outlook for the remainder of this year and that our strategies for profitable growth in 2024 and beyond are gaining momentum."

Selected Financial Information

		Three months ended June 30,										Six months ended June 30,
($ in thousands)		2023			2022 (As Adjusted)(1)			Increase (Decrease)				2023			2022 (As Adjusted)			(Decrease)
Total Revenues	$	147,586		$	181,041		$	(33,455	)		$	341,135		$	344,019		$	(2,884	)
Gross Profit		7,748			6,274			1,474				14,037			11,636			2,401
Net Income (Loss)		(8,846	)		(17,160	)		8,314				(18,058	)		(27,186	)		9,128
Adjusted EBITDA(2)	$	(2,323	)	$	(1,602	)	$	(721	)		$	(4,831	)	$	(3,435	)	$	(1,396	)

(1)		As Adjusted represents the Company's change in accounting principle for recognizing stock-based compensation expense from a graded vesting attribution method to a straight-line attribution method. The effects of the change have been retrospectively applied to all periods effective from January 1, 2023, as presented in the Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Company’s 10-Q to be filed with the SEC on August 14, 2023.
(2)		Adjusted EBITDA represents income (loss) before interest, income taxes, depreciation and amortization, and amortization of debt discount and debt issue costs adjusted for stock-based compensation, loss on impairment, (income) loss from investments, net, change in fair value of derivative liabilities, other (income) expense, net, and foreign exchange adjustments. Refer to Appendix for definition and complete non-GAAP reconciliation for Adjusted EBITDA.

Charge’s CFO Leah Schweller commented, “Although our second quarter revenues declined compared with the prior year period, this was expected due to the ongoing decrease in wholesale voice volume in our Telecommunications segment. However, we continued to benefit from growth within our Infrastructure segment, primarily driven by our BW and EV charging infrastructure businesses. We are encouraged by our robust backlog and our recent acquisition of Greenspeed, which we believe will enable us to serve our customers at an even higher level. Our priorities remain focused on growing revenues and EBITDA, maintaining strong controls over expenses, and driving profitability. In pursuit of growth, we plan to continue to make strategic investments, including proper staffing levels, technology enabled tools, and the ongoing implementation of SMS technology, while diligently seeking opportunities to reduce costs.”

As discussed last quarter, the Company changed its accounting principle for recognizing stock-based compensation expense from a graded vesting attribution method to a straight-line attribution method. Additionally, subsequent to the change in accounting principle, the Company reclassified its expense related to stock-based compensation arrangements to present in the same financial statement line item as cash compensation paid to the same employees and nonemployees. As a result, the stock-based compensation financial statement line item was eliminated, and there was a corresponding change in expense reported in cost of sales, general and administrative and salaries and related benefits financial statement line items. Further details can be found within Note 2, Summary of significant accounting policies, and in the Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Company’s 10-Q to be filed with the SEC on August 14, 2023.

Second Quarter 2023 Financial Results

Revenues for the second quarter of 2023 decreased $33.5 million to $147.6 million, compared with $181.0 million in the second quarter of 2022. The 18% decrease in revenues was the result of lower revenues in the Company’s Telecommunications segment, partially offset by increased revenues in its Infrastructure segment.

• Infrastructure: Revenues increased $4.5 million to $30.0 million, compared with $25.4 million in the second quarter of 2022, driven by increased electrical contracting services within BW, and continued execution within EV charging infrastructure compared with the prior year. The increase was partially offset by lower revenues in the Company’s ANS business, as a result of reduced spending by the major wireless broadband companies.

• Telecommunications: Revenues decreased $38.0 million to $117.6 million, compared with $155.6 million in the second quarter of 2022, primarily attributable to the expected lower wholesale voice volume.

Gross profit for the second quarter of 2023 increased $1.5 million to $7.7 million, compared with $6.3 million in the second quarter of 2022. The increase in gross profit was primarily driven by higher gross profit in the Company’s Infrastructure segment, partially offset by lower gross profit in the Company’s Telecommunications segment.

Consolidated gross margin percentage for the second quarter of 2023 increased versus the prior year period, driven by higher gross margin in both of the Company’s business segments, as well as an increasing proportion of revenues coming from the Company’s higher margin Infrastructure segment.

Net loss for the second quarter of 2023 was $8.8 million, compared with a net loss of $17.2 million in the second quarter of 2022. Expenses after gross profit were primarily related to continued investments the Company made to support its growth strategy. The largest drivers over the prior year period were:

• $5.4 million in general and administrative expense, which represented a decrease of $1.0 million, attributable to a decrease in stock-based compensation expense, partially offset by higher investments in marketing;
• $9.2 million in salaries and related benefits, which represented a $1.4 million increase, driven by incremental headcount to support the growth of the Company over the past year, partially offset by a decrease in stock-based compensation;
• $0.4 million in professional fees, which represented a $0.4 million decrease, primarily related to reduced legal fees in the current period following the insourcing of legal counsel in the fourth quarter of 2022, as well as higher fees incurred in the prior year period to support the uplist to the Nasdaq; and
• $0.1 million in other income/(expense), net, which represented an increase of $7.1 million, primarily driven by a $5.4 million decrease in relation to debt amortization costs and an increase in investment income, net, of $1.7 million.

Net loss of $8.8 million in the second quarter of 2023, adjusted for non-cash and certain one-time items, resulted in an Adjusted EBITDA loss of $2.3 million, compared with Adjusted EBITDA loss of $1.6 million in the second quarter of 2022. See the Appendix for definition and a full reconciliation.

As of June 30, 2023, the Company held $61.7 million in cash, cash equivalents and marketable securities, most of which is used for operations. On August 11, 2023, the Company entered into a Securities Purchase Agreement with an existing stockholder pursuant to which, beginning on October 15, 2023 and through March 31, 2024, the Company has the right, but not the obligation, to sell, and to require the purchaser to purchase, up to $5.0 million of shares of the Company’s common stock, at a purchase price of $1.00 per share.

For further details of the Company’s financials, please see Charge Enterprises’ Form 10-Q to be filed on August 14, 2023, with the Securities and Exchange Commission and available on Charge’s website Charge | SEC Filings. Financial statements prior to December 31, 2021, were filed with the OTC Markets.

Webcast Data

Charge Enterprises, Inc. will host a webcast at 10:30 a.m. Eastern Time today to discuss the second quarter 2023 financial results. The webcast can be accessed on the Company’s website on the Investor Relations page at Charge Enterprises, Inc.

About Charge Enterprises, Inc.

Charge Enterprises, Inc. is an electrical, broadband and EV charging infrastructure company that provides clients with end-to-end project management services. We operate in two segments: Infrastructure, which has a primary focus on EV charging, broadband and wireless, and electrical contracting services; and Telecommunications, which provides connection of voice calls, Short Message Services (SMS) and data to global carriers. Our vision is to be a leader in enabling the next wave of transportation and connectivity. By building, designing, and operating seamless infrastructure for electric vehicles, we aim to create a future where transportation is clean, efficient, and connected and to empower individuals, communities, and businesses to thrive in a more sustainable world. Our plan is to cultivate repeat customers and recurring revenues by deploying a multi-phased strategy, initially where investment in the EV charging revolution is taking place, the nation’s approximately 18,000 franchised auto dealers.

To learn more about Charge, visit Charge Enterprises, Inc.

Notice Regarding Forward-Looking Information

This press release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect current expectations or beliefs regarding future events or Charge's future performance. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", “potential”, "continues", "forecasts", "projects", "predicts", "intends", "anticipates", "targets" or "believes", or variations of, or the negatives of, such words and phrases or state that certain actions, events or results "may", "could", "would", "should", "might" or "will" be taken, occur or be achieved. All forward-looking statements, including those herein, are qualified by this cautionary statement. Although Charge believes that the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements involve risks and uncertainties, and actual results may differ materially from any future results expressed or implied by such forward-looking statements. Such risks and uncertainties include the ability to achieve the expected benefits of the Greenspeed acquisition, including the risks that the Company’s synergy estimates are inaccurate or that the Company faces higher than anticipated integration or other costs in connection with the acquisition, the business plans and strategies of Charge, Charge’s ability to satisfy its debt payment obligations or extend the maturity or refinance outstanding debt at or prior to maturity, Charge's future business development, market acceptance of electric vehicles, the success of Charge’s retail dealership initiative and the size, scope and success of the related initial installation projects, Charge's ability to generate profits and positive cash flow, changes in government regulations and government incentives, subsidies, or other favorable government policies, rising interest rates and the impact on investments by our customers, and other risks discussed in Charge's filings with the U.S. Securities and Exchange Commission ("SEC"). Readers are cautioned that the foregoing list of risks and uncertainties is not exhaustive of the factors that may affect forward-looking statements. Accordingly, readers should not place undue reliance on forward-looking statements. The forward-looking statements in this press release speak only as of the date of this press release or as of the date or dates specified in such statements. For more information on us, investors are encouraged to review our public filings with the SEC, including the factors described in the section captioned “Risk Factors” of Charge’s Annual Report on Form 10-K filed with the SEC on March 15, 2023, and Charge’s Quarterly Report on Form 10-Q to be filed with the SEC on August 14, 2023, as well as subsequent reports we file from time to time with the SEC which are available on the SEC's website at www.sec.gov. Charge disclaims any intention or obligation to update or revise any forward- looking information, whether as a result of new information, future events or otherwise, other than as required by law.

Notice Regarding Non-GAAP Measures

The press release includes both financial measures in accordance with U.S. generally accepted accounting principles (“GAAP”), as well as non-GAAP financial measures. These non-GAAP financial measures are in addition to, and not a substitute for or superior to, measures of financial performance prepared in accordance with GAAP. See the Appendix for a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures. These non-GAAP financial measures may be different from non-GAAP financial measures used by other companies.

APPENDIX

CHARGE ENTERPRISES, INC. CONSOLIDATED RESULTS OF OPERATIONS (Unaudited)
	Three Months Ended June 30,													Six Months Ended June 30,
								Increase			% Increase										Increase			% Increase
(in thousands)		2023			2022 (As Adjusted)			(Decrease)			(Decrease)				2023			2022 (As Adjusted)			(Decrease)			(Decrease)
Revenues:
Infrastructure	$	29,954		$	25,433		$	4,521			18	%		$	57,451		$	45,051		$	12,400			28	%
Telecommunications		117,632			155,608			(37,976	)		(24	%)			283,684			298,968			(15,284	)		(5	%)
Total revenues		147,586			181,041			(33,455	)		(18	%)			341,135			344,019			(2,884	)		(1	%)
Cost of Sales		139,838			174,767			(34,929	)		(20	%)			327,098			332,383			(5,285	)		(2	%)
Gross profit		7,748			6,274			1,474			23	%			14,037			11,636			2,401			21	%
General and administrative		5,433			6,452			(1,019	)		(16	%)			10,539			12,059			(1,520	)		(13	%)
Salaries and related benefits		9,156			7,799			1,357			17	%			18,283			15,747			2,536			16	%
Professional fees		446			848			(402	)		(47	%)			912			1,912			(1,000	)		(52	%)
Depreciation and amortization expense		1,192			1,103			89			8	%			2,402			1,312			1,090			83	%
Income (loss) from operations		(8,479	)		(9,928	)		1,449			15	%			(18,099	)		(19,394	)		1,295			7	%
Other income (expenses)		(125	)		(7,187	)		7,062			98	%			393			(9,120	)		9,513			104	%
Income tax (expense) benefit		(242	)		(45	)		(197	)		(438	%)			(352	)		1,328			(1,680	)		(127	%)
Net income (loss)	$	(8,846	)	$	(17,160	)	$	8,314			48	%		$	(18,058	)	$	(27,186	)	$	9,128			34	%

Infrastructure

CHARGE ENTERPRISES, INC. SEGMENT RESULTS OF OPERATIONS (Unaudited)
	Three Months Ended June 30,													Six Months Ended June 30,
								Increase			% Increase										Increase			% Increase
(in thousands)		2023			2022 (As Adjusted)			(Decrease)			(Decrease)				2023			2022 (As Adjusted)			(Decrease)			(Decrease)
Revenues	$	29,954		$	25,433		$	4,521			18	%		$	57,451		$	45,051		$	12,400			28	%
Cost of Sales		23,114			20,247			2,867			14	%			45,019			35,931			9,088			25	%
Gross profit		6,840			5,186			1,654			32	%			12,432			9,120			3,312			36	%
General and administrative		1,527			1,612			(85	)		(5	%)			2,933			2,746			187			7	%
Salaries and related benefits		4,733			4,066			667			16	%			9,883			8,147			1,736			21	%
Professional fees		75			81			(6	)		(7	%)			108			142			(34	)		(24	%)
Depreciation and amortization expense		1,183			1,062			121			11	%			2,373			1,227			1,146			93	%
Income (loss) from operations		(678	)		(1,635	)		957			59	%			(2,865	)		(3,142	)		277			9	%
Other income (expenses)		29			(365	)		394			108	%			175			(814	)		989			121	%
Income tax (expense) benefit		(242	)		15			(257	)		(1713	%)			(352	)		105			(457	)		(435	%)
Net income (loss)	$	(891	)	$	(1,985	)	$	1,094			55	%		$	(3,042	)	$	(3,851	)	$	809			21	%

Telecommunications

	Three Months Ended June 30,													Six Months Ended June 30,
								Increase			% Increase										Increase			% Increase
(in thousands)		2023			2022 (As Adjusted)			(Decrease)			(Decrease)				2023			2022 (As Adjusted)			(Decrease)			(Decrease)
Revenues	$	117,632		$	155,608		$	(37,976	)		(24	%)		$	283,684		$	298,968		$	(15,284	)		(5	%)
Cost of Sales		116,724			154,520			(37,796	)		(24	%)			282,079			296,452			(14,373	)		(5	%)
Gross profit		908			1,088			(180	)		(17	%)			1,605			2,516			(911	)		(36	%)
General and administrative		598			566			32			6	%			1,163			1,163			-			0	%
Salaries and related benefits		293			229			64			28	%			525			607			(82	)		(14	%)
Professional fees		5			11			(6	)		(55	%)			25			36			(11	)		(31	%)
Depreciation and amortization expense		9			41			(32	)		(78	%)			29			85			(56	)		(66	%)
Income (loss) from operations		3			241			(238	)		(99	%)			(137	)		625			(762	)		(122	%)
Other income (expenses)		344			201			143			71	%			625			73			552			756	%
Income tax (expense) benefit		-			67			(67	)		(100	%)			-			252			(252	)		(100	%)
Net income (loss)	$	347		$	509		$	(162	)		(32	%)		$	488		$	950		$	(462	)		(49	%)

Non-Operating Corporate

	Three Months Ended June 30,													Six Months Ended June 30,
								Increase			% Increase										Increase			% Increase
(in thousands)		2023			2022 (As Adjusted)			(Decrease)			(Decrease)				2023			2022 (As Adjusted)			(Decrease)			(Decrease)
Revenues	$	-		$	-		$	-						$	-		$	-		$	-
Cost of Sales		-			-			-							-			-			-
Gross profit		-			-			-							-			-			-
General and administrative		3,308			4,274			(966	)		(23	%)			6,443			8,150			(1,707	)		(21	%)
Salaries and related benefits		4,130			3,504			626			18	%			7,875			6,993			882			13	%
Professional fees		366			756			(390	)		(52	%)			779			1,734			(955	)		(55	%)
Income (loss) from operations		(7,804	)		(8,534	)		730			9	%			(15,097	)		(16,877	)		1,780			11	%
Other income (expenses)		(498	)		(7,023	)		6,525			93	%			(407	)		(8,379	)		7,972			95	%
Income tax (expense) benefit		-			(127	)		127			100	%			-			971			(971	)		(100	%)
Net income (loss)	$	(8,302	)	$	(15,684	)	$	7,382			47	%		$	(15,504	)	$	(24,285	)	$	8,781			36	%

Charge Enterprises, Inc.
Consolidated Balance Sheets
(Unaudited)
			June 30,				December 31,
In thousands, except share and per share data			2023				2022 (As Adjusted)
Assets
Current assets
Cash and cash equivalents		$	50,142			$	26,837
Restricted cash			886				886
Accounts receivable net of allowances of $184 in 2023 and $322 in 2022			74,036				72,405
Inventory			118				111
Deposits, prepaids and other current assets			2,298				3,187
Investments in marketable securities			11,597				6,757
Investments in non-marketable securities			236				236
Contract assets			7,290				6,090
Total current assets			146,603				116,509
Property, plant and equipment, net			553				732
Finance lease right-of-use asset			600				341
Operating lease right-of-use asset			3,323				4,028
Non-current assets			248				240
Goodwill			12,672				12,672
Intangible assets, net			31,865				33,932
Total Assets			195,864				168,454
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable		$	87,946			$	61,644
Accrued liabilities			7,801				11,121
Contract liabilities			24,765				13,741
Derivative liability			59				6,521
Finance lease liability			163				112
Operating lease liability			1,336				1,579
Current portion of long-term debt			26,136				29,180
Total current liabilities			148,206				123,898
Non-current liabilities
Finance lease liability, non-current			374				146
Operating lease liability, non-current			1,809				2,199
Net deferred tax liability			1,170				1,410
Total Liabilities			151,559				127,653
Mezzanine Equity
Series C Preferred Stock (6,226,370 shares issued and outstanding at June 30, 2023, and December 31, 2022)			16,572				16,572
Total Mezzanine Equity			16,572				16,572
Commitments, contingencies and concentration risk
Stockholders' Equity
Preferred stock, $0.0001 par value, 20,000,000 shares authorized;
Series D: 1,177,023 shares issued and outstanding at June 30, 2023, and December 31, 2022			-				-
Series E: 3,200,000 shares issued and outstanding at June 30, 2023, and 0 shares outstanding at December 31, 2022			-				-
Common stock, $0.0001 par value; 750,000,000 shares authorized 212,899,281 and 206,844,580 issued and outstanding at June 30, 2023 and December 31, 2022, respectively			21				20
Additional paid in capital			201,989				179,723
Accumulated other comprehensive income (loss)			-				-
Accumulated deficit			(174,277	)			(155,514	)
Total Stockholders' Equity			27,733				24,229
Total Liabilities and Stockholders' Equity		$	195,864			$	168,454

Charge Enterprises, Inc.
Consolidated Statement of Operations
(Unaudited)
		Three Months Ended June 30,								Six Months Ended June 30,
In thousands, except per share data		2023				2022 (As Adjusted)				2023				2022 (As Adjusted)
Revenues		$	147,586			$	181,041			$	341,135			$	344,019
Cost of sales			139,838				174,767				327,098				332,383
Gross profit			7,748				6,274				14,037				11,636
Operating expenses
General and administrative			5,433				6,452				10,539				12,059
Salaries and related benefits			9,156				7,799				18,283				15,747
Professional fees			446				848				912				1,912
Depreciation and amortization expense			1,192				1,103				2,402				1,312
Total operating expenses			16,227				16,202				32,136				31,030
(Loss) from operations			(8,479	)			(9,928	)			(18,099	)			(19,394	)
Other income (expenses):
Income (loss) from investments, net			666				(973	)			962				(1,143	)
Change in fair value of derivative liabilities			280				-				1,656				-
Interest expense			(1,488	)			(7,160	)			(3,026	)			(8,924	)
Loss on impairment			(58	)			-				(58	)			-
Other income (expense), net			637				776				1,028				1,034
Foreign exchange adjustments			(162	)			170				(169	)			(87	)
Total other income (expenses), net			(125	)			(7,187	)			393				(9,120	)
(Loss) before income taxes			(8,604	)			(17,115	)			(17,706	)			(28,514	)
Income tax (expense) benefit			(242	)			(45	)			(352	)			1,328
Net (loss)		$	(8,846	)		$	(17,160	)		$	(18,058	)		$	(27,186	)
Less: Deemed dividend			-				(32,841	)			-				(36,697	)
Less: Preferred dividends			(362	)			(353	)			(724	)			(620	)
Net (loss) available to common stockholders		$	(9,208	)		$	(50,354	)		$	(18,782	)		$	(64,503	)
Basic income (loss) per share available to common stockholders		$	(0.04	)		$	(0.26	)		$	(0.09	)		$	(0.34	)
Diluted income (loss) per share available to common stockholders		$	(0.04	)		$	(0.26	)		$	(0.09	)		$	(0.34	)
Weighted average number of shares outstanding, basic			212,858				193,508				209,974				190,966
Weighted average number of shares outstanding, diluted			212,858				193,508				209,974				190,966

Charge Enterprises, Inc.
Consolidated Statement of Cash Flows
(Unaudited)
	Six Months Ended June 30,
		2023				2022 (As Adjusted)
In thousands
Cash flows from Operating Activities:
Net loss	$	(18,058	)		$	(27,186	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Amortization		2,067				861
Depreciation		335				451
Stock-based compensation		10,866				14,228
Change in fair value of derivative liabilities		(1,656	)			-
Amortization of debt discount		1,980				7,444
Loss on foreign currency exchange		169				87
Loss on impairment		58		-
Net loss (gain) from investments		(962	)			1,143
Other expense, net		(794	)			(855	)
Change in deferred income taxes		(219	)			(1,328	)
Changes in working capital requirements:
Accounts receivable		(1,776	)			(1,856	)
Inventory		(6	)			(57	)
Deposits, prepaids and other current assets		112				(304	)
Other assets / liabilities		124				(30	)
Contract assets		(1,200	)			(3,445	)
Accounts payable		26,477				27,162
Other current liabilities		186				1,062
Contract liabilities		11,024				(1,741	)
Net cash provided by operating activities		28,727				15,636
Cash flows from Investing Activities:
Acquisition of property, plant and equipment		(102	)			(70	)
Sale of intellectual property		794				159
Purchase of marketable securities		(22,530	)			(43,255	)
Sale of marketable securities		18,612				34,901
Acquisition of EV Depot		1				(1,231	)
Cash acquired in acquisitions		-				104
Net cash provided by (used in) investing activities		(3,225	)			(9,392	)
Cash flows from Financing Activities:
Proceeds from sale of common stock		-				10,000
Proceeds from sale of Series C preferred stock		-				10,845
Proceeds from issuance of Series E preferred stock		1,600				-
Proceeds from exercise of warrants		2,200				1,072
Proceeds from exercise of stock options		41				20
Draws from revolving line of credit		4,717				10,409
Payments on revolving line of credit		(9,741	)			(9,550	)
Payment on financing lease		(141	)			(102	)
Payment of dividends on preferred stock		(724	)			(498	)
Net cash (used in) provided by financing activities		(2,048	)			22,196
Effect of foreign exchange rate changes		(149	)			(97	)
Net Increase in Cash and Cash Equivalents		23,305				28,343
Cash, Cash Equivalents, and Restricted Cash, Beginning of Period		27,723				18,238
Cash, Cash Equivalents, and Restricted Cash, End of Period	$	51,028			$	46,581
Cash paid for interest expense	$	969			$	1,477
Cash paid for income taxes	$	718			$	-
Non-cash investing and financing activities:
Issuance of common stock for acquisition	$	-			$	17,530

Non-GAAP Measures

In this press release, the Company has supplemented the presentation of its financial results calculated in accordance with U.S. generally accepted accounting principles (“GAAP”) with the following financial measures that are not calculated in accordance with GAAP: EBITDA and Adjusted EBITDA. Management uses both GAAP and non-GAAP measures to assist in making business decisions and assessing overall performance. The Company’s measurement of these non-GAAP financial measures may be different from similarly titled financial measures used by others and therefore may not be comparable. These non-GAAP financial measures should not be considered superior to the GAAP measures in the tables included within this material.

Certain information presented in this press release reflects adjustments to GAAP measures such as EBITDA and Adjusted EBITDA as an additional way of assessing certain aspects of the Company’s operations that, when viewed with the GAAP financial measures, provide a more complete understanding of its on-going business. EBITDA is defined as income (loss) before interest, income taxes, depreciation and amortization, and amortization of debt discount and debt issue costs. Adjusted EBITDA represents EBITDA adjusted for stock-based compensation, income (loss) from investments, net, change in fair value of derivative liabilities, other (income) expense, net, and foreign exchange adjustments.

As it related to future projections for the Company’s Adjusted EBITDA described above, the Company has not provided guidance for comparable GAAP measure or a quantitative reconciliation of forward-looking non-GAAP financial measures because it is unable to determine with reasonable certainty the ultimate outcome of certain significant items necessary to calculate such measures without unreasonable effort. These items include, but are not limited to income or loss from investments, change in fair value of derivative liabilities and foreign exchange adjustments.

CHARGE ENTERPRISES, INC. NON-GAAP RECONCILIATION
		Three months ended June 30,						Six months ended June 30,
($ in thousands)		2023			2022 (As Adjusted)			2023			2022 (As Adjusted)
Adjusted EBITDA:
Net income (loss)	$	(8,846	)		(17,160	)	$	(18,058	)		(27,186	)
Income tax expense (benefit)		242			45			352			(1,328	)
Interest expense		1,488			7,160			3,026			8,924
Depreciation & Amortization		1,192			1,103			2,402			1,312
EBITDA		(5,924	)		(8,852	)		(12,278	)		(18,278	)
Adjustments:
Stock based compensation		4,964			7,223			10,866			14,647
(Income) loss from investments, net		(666	)		973			(962	)		1,143
Change in fair value of derivative liabilities		(280	)		-			(1,656	)		-
Loss on impairment		58			-			58			-
Other (income) expense, net		(637	)		(776	)		(1,028	)		(1,034	)
Foreign exchange adjustments		162			(170	)		169			87
Adjusted EBITDA	$	(2,323	)	$	(1,602	)	$	(4,831	)	$	(3,435	)

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20230814199166/en/

Investors

Christine Cannella (954) 298-6518

ccannella@charge.enterprises

Kevin McGrath (646) 418-7002

kevin@tradigitalir.com

Media:

Kristopher Conesa (305) 975-5934

kconesa@csuitepr.com

Source: Charge Enterprises, Inc.