Crown Reports Third Quarter 2024 Results

Rhea-AI Summary

Crown Electrokinetics (NASDAQ: CRKN) reported record quarterly revenue of $8.0 million for Q3 2024, up from zero in Q3 2023. The company reaffirmed Q4 and full-year 2024 revenue guidance of $9 million and $22 million respectively. For 2025, Crown projects revenue between $30-35 million and expects to achieve profitability. Q3 2024 showed a gross profit of $1.4 million but recorded a net loss of $5.9 million. The company secured major contracts in fiber optics networks and water solutions, including $15 million in lead pipe inspection projects and $33 million in lead pipe remediation contracts.

Positive

• Record quarterly revenue of $8.0 million in Q3 2024
• Secured $15 million in lead pipe inspection projects
• Awarded $33 million in lead pipe remediation contracts
• Projects revenue growth to $30-35 million for 2025
• Expects to achieve profitability in 2025

Negative

• Net loss increased to $5.9 million in Q3 2024 from $2.9 million in Q3 2023
• Operating expenses rose to $7.2 million from $3.4 million YoY
• Cash position of only $3.1 million as of September 30, 2024

Insights

Financial Analyst

Crown's Q3 results show significant revenue growth to $8.0 million, up from zero in Q3 2023, primarily driven by their Fiber Optics and Water Solutions segments. However, the company's net loss widened to $5.9 million from $2.9 million year-over-year, with operating expenses increasing to $7.2 million. The $3.1 million cash position against a market cap of $7.1 million raises liquidity concerns.

While the company secured significant contracts, including $15 million in Element 82 lead pipe inspection projects and $33 million in remediation contracts, the high operating expenses and widening losses suggest challenges in achieving profitability. The guidance for Q4 revenue of $9 million and FY2024 revenue of $22 million shows optimism, but reaching profitability in 2025 may be ambitious given the current burn rate.

Infrastructure Development Analyst

The company's diversification into three distinct infrastructure segments - Smart Windows, Fiber Optics and Water Solutions - presents a strategic market positioning. The slant wells project in Cabo San Lucas demonstrates innovative water access solutions, while the lead pipe detection and remediation contracts in multiple states indicate strong market demand for infrastructure modernization.

However, the delayed rollout of Smart Window Inserts to Q1 2025 suggests potential development challenges in this segment. The projected revenue growth to $30-35 million for 2025 appears ambitious but achievable given the secured contracts and expanding project pipeline, particularly in the water infrastructure and fiber optics sectors.

Achieved Record Quarterly Revenue of $8.0 Million

Reiterates Fourth Quarter and Full Year 2024 Revenue Guidance of $9 Million and $22 Million, Respectively

Conference Call and Webcast Scheduled for Today, November 14^th at 11:00 a.m. ET

LOS ANGELES, Nov. 14, 2024 (GLOBE NEWSWIRE) -- Crown Electrokinetics Corp. (NASDAQ: CRKN) ("Crown" or the "Company”), a leading provider of innovative technology infrastructure solutions that benefit communities and the environment, today reported its financial results for the third quarter ended September 30, 2024.

“We’re pleased with our strong third quarter performance, achieving record quarterly revenue of $8.0 million. Crown’s results this quarter reflect the solid foundation and growing operational momentum across our three highly scalable businesses,” said Doug Croxall, CEO and Chairman, Crown. “With diverse and related business divisions, we are focused on developing and providing cutting-edge solutions for multiple large and growing addressable markets. The second half of 2024 continues to bring increased demand for our solutions, as evidenced by recent project wins for lead pipe identification and remediation, slant wells installations, and fiber optic network construction, as well as a strong pipeline for upcoming projects. Crown is well positioned to achieve our growth objectives for the remainder of 2024, and importantly remaining on track to achieve profitability in full year 2025.”

“In 2024, we strategically sought and established a leadership team comprised of industry experts, each bringing a track record of proven success in business, paired with a desire to disrupt the status quo with innovation. We are excited to witness our team execute our vision and plan to provide innovative solutions that benefit communities and the environment, deliver positive societal change, and shape a better future,” concluded. Mr. Croxall.

Recent Business Highlights

Smart Windows

• Announced three-phase product rollout strategy of its first-generation Smart Window Inserts expected to commence in the first quarter of 2025.
  

Fiber Optics

• Secured three major customer agreements for design and construction of fiber optics networks in Oregon and Nevada.
  

Water Solutions

Slant Wells

• Commenced installation of two proprietary design slant wells at Vista Serena’s Twin Dolphin in Cabo San Lucas, Mexico, unlocking a new source of water in an area challenged with clean water access.
  
• Engaged with new customers for survey work in the Los Cabos area to prepare for future slant well installations.

Lead Pipes: Element 82 & PE Pipelines

• Secured initial lead pipe detection projects for Element 82 in the states of Florida and New York.
  
• Signed over $15 million in Element 82 lead pipe inspection projects in Washington, D.C. and Maryland.
  
• Awarded two initial lead pipe remediation contracts for PE Pipelines, totaling $33 million.
  

Financial Results for Third Quarter Ended September 30, 2024

Revenue was $8.0 million for the third quarter 2024, increased from zero in the same period of 2023. Increased revenue is primarily attributable to new contracts from Crown’s Fiber Optics and Water Solutions businesses, including the new Element 82 lead detection business.

Gross profit was $1.4 million for the third quarter 2024, compared to gross profit of zero in the same period of 2023.

Operating expenses were approximately $7.2 million for the third quarter 2024, up from $3.4 million in same period of 2023.

Net loss was $5.9 million for the third quarter 2024, compared with net loss of $2.9 million in the same period of 2023.

Financial Results for the Nine Months Ended September 30, 2024

Revenue was $13.4 million for the nine-months ended September 30, 2024, increased from $0.1 million in the same period of 2023. Increased revenue is primarily attributable to new Fiber Optics and Water Solutions contracts, including the new Element 82 business.

Gross profit was $0.9 million for the nine-months ended September 30, 2024, compared to gross profit of zero in the same period of 2023.

Operating expenses were approximately $15.4 million for the nine-months ended September 30, 2024, up from $12.4 million in same period of 2023.

Net loss was $15.5 million for the nine-months ended September 30, 2024, compared with net loss of $19.7 million in the same period of 2023.

Balance Sheet and Liquidity

As of September 30, 2024, Stockholders’ Equity was $9.9 million, and cash was approximately $3.1 million.

Outlook

Crown reiterates its fourth quarter and full year 2024 revenue guidance of $9.0 million and $22.0 million, respectively. The Company introduces its full year 2025 outlook, anticipating revenue between $30 million and $35 million, while remaining on track to achieve profitability in 2025.

Conference Call and Webcast Information

The Company will host a conference call and audio webcast today, Thursday, November 14^th at 11:00 a.m. Eastern Time featuring remarks by Crown’s management team.

Conference Call Information
Date: Thursday, November 14, 2024
Time: 11:00 a.m. Eastern Time / 8:00 a.m. Pacific Time
Live Call: +1-877-451-6152 or +1-201-389-0879 or Call me™
Webcast: https://viavid.webcasts.com/starthere.jsp?ei=1689461&tp_key=0bee79c89d

For interested individuals unable to join the conference call, a replay will be available through November 28, 2024, at +1-844-512-2921 or +1-412-317-6671. Participants must use the following code to access the replay of the call: 13748946. An archived version of the webcast will also be available on Crown’s Investor Relations site: https://ir.crownek.com/.

About Crown
Crown (Nasdaq: CRKN) is an innovative infrastructure solutions provider dedicated to benefiting communities and the environment. Comprised of three business divisions, Smart Windows, Fiber Optics, and Water Solutions, Crown is developing and delivering cutting edge solutions that are challenging the status quo and redefining industry standards. For more information, please visit www.crownek.com.

Forward Looking Statements
Certain statements in this news release may be "forward-looking statements" (within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995) regarding future events or Crown’s future financial performance that involve certain contingencies and uncertainties, including those discussed in Crown’s Annual Report on Form 10-K for the year ended December 31, 2023, and subsequent reports Crown files with the U.S. Securities and Exchange Commission from time to time, in the sections entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Forward-looking statements include, but are not limited to, statements that express our intentions, beliefs, expectations, strategies, predictions, or any other statements relating to our future activities or other future events or conditions. These statements are based on current expectations, estimates and projections about our business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may, and are likely to, differ materially from what is expressed or forecasted in forward-looking statements due to numerous factors. Any forward-looking statements speak only as of the date of this news release and Crown Electrokinetic Corporation undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date of this news release. This press release does not constitute a public offer of any securities for sale. Any securities offered privately will not be or have not been registered under the Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

For more information, please contact:

Investor Relations
info@crownek.com

FAQ

What was Crown's (CRKN) revenue for Q3 2024?

Crown reported record quarterly revenue of $8.0 million for Q3 2024.

What is Crown's (CRKN) revenue guidance for full-year 2024?

Crown reiterated its full-year 2024 revenue guidance of $22.0 million.

When does Crown (CRKN) expect to achieve profitability?

Crown expects to achieve profitability in full year 2025.

What was Crown's (CRKN) net loss in Q3 2024?

Crown reported a net loss of $5.9 million for Q3 2024.