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Forward Reports Fiscal 2023 Third Quarter Results

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HAUPPAUGE, N.Y., Aug. 14, 2023 (GLOBE NEWSWIRE) -- Forward Industries, Inc. (NASDAQ:FORD), a global design, sourcing and distribution group, today announced financial results for its third quarter ended June 30, 2023.

Third Quarter Fiscal Year 2023 Financial Highlights  

  • Revenues were $10.1 million, a decrease of 4.7% from $10.6 million for the third quarter of fiscal year 2022.

  • Gross margin declined to 18.0% compared to 18.1% for the third quarter of fiscal year 2022.

  • Operating loss was $0.5 million compared to $0.4 million for the third quarter of fiscal year 2022.

  • Basic and diluted loss per share was $0.05 compared to $0.04 for the third quarter of fiscal year 2022.

  • Cash balance of $2.8 million at June 30, 2023 as compared to $2.6 million at September 30, 2022.

Terry Wise, Chief Executive Officer of Forward Industries, stated, “Pleasingly, the quarter witnessed the sustained positive momentum within our design division. However, this strong performance was offset by the continued difficulties within the retail and OEM sector. Consequently, after careful deliberation and consideration we have reluctantly resolved to discontinue our retail division in an orderly manner that will ensure we fulfil our commitments to our customers. This has been a pivotal quarter for the Company, one in which as a direct consequence of the decisions taken, we hope will result in profitability in the near future.” 

The tables below are derived from the Company’s consolidated financial statements included in its Form 10-Q filed on August 14, 2023 with the Securities and Exchange Commission. Please refer to the Form 10-Q for complete financial statements and further information regarding the Company’s results of operations and financial condition relating to the fiscal quarters ended June 30, 2023 and 2022. Please also refer to the Company’s Form 10-K for a discussion of risk factors applicable to the Company and its business. 

Cautionary Note Regarding Forward-Looking Statements

This press release contains certain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 including statements regarding our optimism for improved performance in fiscal year 2023. Forward has tried to identify these forward-looking statements by using words such as “may”, “should,” “expect,” “hope,” “anticipate,” “believe,” “intend,” “plan,” “estimate” and similar expressions. These forward-looking statements are based on information currently available to the Company and are subject to a number of risks, uncertainties and other factors that could cause its actual results, performance, prospects or opportunities to differ materially from those expressed in, or implied by, these forward-looking statements. These risks include the inability to expand our customer base, loss of additional customers, pricing pressures, lack of success of our sales people, supply chain issues, inability of our design division’s customers to pay for our services, unanticipated issues with our affiliated sourcing agent, and issues at Chinese factories that we source our products. No assurance can be given that the actual results will be consistent with the forward-looking statements. Investors should read carefully the factors described in the “Risk Factors” section of the Company’s filings with the SEC, including the Company’s Form 10-K for the year ended September 30, 2022 for information regarding risk factors that could affect the Company’s results. Except as otherwise required by Federal securities laws, Forward undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason.

About Forward Industries

Forward is a global design, sourcing and distribution group serving top tier medical and technology customers worldwide. Through its acquisitions of Intelligent Product Solutions, Inc. and Kablooe Design, Inc., the Company has expanded its ability to design and develop solutions for its existing multinational client base and expand beyond the diabetic product line into a variety of industries with a full spectrum of hardware and software product design and engineering services

For more information, contact:        
Kathleen Weisberg, CFO, Forward Industries, Inc.                
(631) 547-3055, kweisberg@forwardindustries.com



FORWARD INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
       
    June 30, September 30,
     2023   2022 
Assets (Unaudited)  
       
Current assets:   
 Cash $2,821,163  $2,575,522 
 Accounts receivable, net 7,659,132   7,542,666 
 Inventories, net 1,892,790   3,801,030 
 Prepaid expenses and other current assets 689,955   417,605 
       
   Total current assets 13,063,040   14,336,823 
       
Property and equipment, net 282,308   241,146 
Intangible assets, net 946,333   1,105,901 
Goodwill 1,758,682   1,758,682 
Operating lease right-of-use assets, net 3,124,871   3,427,726 
Other assets 68,737   68,737 
       
   Total assets$19,243,971  $20,939,015 
       
Liabilities and shareholders' equity   
       
Current liabilities:   
 Accounts payable$684,616  $268,160 
 Due to Forward China 7,948,249   7,713,880 
 Deferred income 264,726   438,878 
 Current portion of earnout consideration -   25,000 
 Current portion of operating lease liability 406,223   377,940 
 Accrued expenses and other current liabilities 1,283,337   1,153,906 
   Total current liabilities 10,587,151   9,977,764 
       
Other liabilities:   
 Note payable to Forward China 1,200,000   1,400,000 
 Operating lease liability, less current portion 2,942,772   3,249,824 
 Earnout consideration, less current portion 30,000   45,000 
  Total other liabilities 4,172,772   4,694,824 
       
   Total liabilities 14,759,923   14,672,588 
       
Commitments and contingencies   
       
Shareholders' equity:   
 Common stock, par value $0.01 per share; 40,000,000 shares authorized;   
  10,061,185 shares issued and outstanding at June 30, 2023   
  and September 30, 2022 100,612   100,612 
 Additional paid-in capital 20,171,299   20,115,711 
 Accumulated deficit (15,787,863)  (13,949,896)
       
   Total shareholders' equity 4,484,048   6,266,427 
       
   Total liabilities and shareholders' equity$19,243,971  $20,939,015 
       



FORWARD INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
      
 For the Three Months Ended June 30, For the Nine Months Ended June 30,
  2023   2022   2023   2022 
        
Revenues, net$10,127,159  $10,588,835  $31,594,818  $32,517,139 
Cost of sales 8,303,997   8,671,103   26,340,525   25,727,964 
Gross profit 1,823,162   1,917,732   5,254,293   6,789,175 
        
Sales and marketing expenses 711,472   664,484   2,175,081   2,106,263 
General and administrative expenses 1,633,740   1,639,053   4,912,197   5,177,241 
        
     Loss from operations (522,050)  (385,805)  (1,832,985)  (494,329)
        
Fair value adjustment of earnout consideration -   -   (40,000)  - 
Interest expense 25,475   30,424   80,214   94,115 
Interest income (10,489)  -   (11,345)  - 
Other (income)/expense, net (292)  2,684   (23,887)  6,780 
     Loss before income taxes (536,744)  (418,913)  (1,837,967)  (595,224)
        
Provision for income taxes -   -   -   - 
        
     Net loss$(536,744) $(418,913) $(1,837,967) $(595,224)
        
Loss per share:       
     Basic$(0.05) $(0.04) $(0.18) $(0.06)
     Diluted$(0.05) $(0.04) $(0.18) $(0.06)
        
Weighted average common shares outstanding:       
     Basic 10,061,185   10,061,185   10,061,185   10,061,185 
     Diluted 10,061,185   10,061,185   10,061,185   10,061,185 
        



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