Forward Reports Fiscal 2024 Second Quarter Results
Forward Industries, Inc. (NASDAQ:FORD) reported a decrease in revenues to $7.8 million in the second quarter of fiscal year 2024, down by 19.6% from the previous year. Despite an increase in gross margin to 20.5%, the company faced a loss from continuing operations of $0.5 million. The net loss was $0.6 million, with basic and diluted loss per share at $0.05. The cash balance stood at $2.3 million as of March 31, 2024. CEO Terry Wise highlighted the company's focus on profitability and cost management.
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Revenues decreased by 19.6% to $7.8 million in the second quarter of fiscal year 2024.
Loss from continuing operations increased to $0.5 million compared to $0.1 million in 2023.
Net loss increased to $0.6 million compared to $0.9 million in 2023.
Basic and diluted loss per share from continuing operations was $0.05 compared to $0.01 for 2023.
Cash balance decreased to $2.3 million at March 31, 2024, from $3.2 million at September 30, 2023.
Insights
Reviewing Forward Industries' second quarter financial performance reveals a considerable revenue decline of 19.6%, a not insignificant figure that points to potential issues in either the industry or the company’s operations. However, the gross margin has seen a slight increase, which suggests that the company is improving its cost management or that its product mix has shifted towards higher-margin offerings. As for net loss, seeing a reduction from $0.9 million to $0.6 million year-over-year can be interpreted positively, as it might indicate initial effectiveness of the restructuring efforts.
The CEO’s comments on discontinued operations and a focus on profitability represent an optimistic future outlook, but such statements should be taken with caution until consistent profit numbers are reported. The decrease in cash balance, from $3.2 million to $2.3 million, over the six-month period could raise concerns about the company's liquidity and its ability to finance ongoing operations without resorting to additional capital raises or debt.
From a market perspective, Forward Industries’ situation should be analyzed in the context of broader market conditions and competitive dynamics. The significant top-line revenue slip might reflect a loss of market share or a contraction in the markets they operate in. There's no mention of new product launches or expansions which may hint at a stagnation, potentially leaving Forward Industries vulnerable to more agile competitors.
The reduced losses suggest that past investments or cost-cutting measures are beginning to bear fruit, yet it’s critical to assess whether this is due to one-off savings or sustainable operational efficiencies. Investors should also consider external industry health indicators and competitive strategies when evaluating Forward Industries' future growth potential, especially in light of the CEO's statements regarding the pursuit of 'robust growth and profitability.'
HAUPPAUGE, N.Y., May 10, 2024 (GLOBE NEWSWIRE) -- Forward Industries, Inc. (NASDAQ:FORD), a global design, sourcing and distribution group, today announced financial results for its second quarter ended March 31, 2024.
Second Quarter Fiscal Year 2024 Financial Highlights
- Revenues were
$7.8 million , a decrease of19.6% from$9.7 million for 2023. - Gross margin increased to
20.5% compared to19.8% for 2023. - Loss from continuing operations was
$0.5 million compared to$0.1 million in 2023 and net loss was$0.6 million compared to$0.9 million in 2023. - Basic and diluted loss per share from continuing operations was
$0.05 compared to$0.01 for 2023. - Cash balance of
$2.3 million at March 31, 2024 compared to$3.2 million at September 30, 2023.
Terry Wise, Chief Executive Officer of Forward Industries, stated “The business continues to focus on proactively taking measures to return the group to profitability. Costs from our discontinued retail division have largely come to a conclusion. While this is pleasing, we will need a prolonged sustained effort from all our divisions to fulfill our objective of robust growth and profitability.”
The tables below are derived from the Company’s condensed consolidated financial statements included in its Form 10-Q filed on May 10, 2024 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 March 31, 2024 and 2023. 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 profitability and growth. 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, competition, pricing pressures, supply chain issues, inability of our design division’s customers to pay for our services, loss of talented employees, unanticipated issues with our affiliated sourcing agent, and issues at Chinese factories that 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, 2023 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 | ||||||||||
| March 31, | September 30, | |||||||||
| 2024 | 2023 | |||||||||
| Assets | (Unaudited) | |||||||||
| Current assets: | ||||||||||
| Cash | $ | 2,261,853 | $ | 3,180,468 | ||||||
| Accounts receivable, net of allowances for credit losses of | ||||||||||
| 6,484,427 | 6,968,778 | |||||||||
| Inventories, net | 308,895 | 334,384 | ||||||||
| Discontinued assets held for sale | - | 508,077 | ||||||||
| Prepaid expenses and other current assets | 457,071 | 378,512 | ||||||||
| Total current assets | 9,512,246 | 11,370,219 | ||||||||
| Property and equipment, net | 254,971 | 274,046 | ||||||||
| Intangible assets, net | 786,765 | 893,143 | ||||||||
| Goodwill | 1,758,682 | 1,758,682 | ||||||||
| Operating lease right-of-use assets, net | 2,810,059 | 3,021,315 | ||||||||
| Other assets | 68,737 | 68,737 | ||||||||
| Total assets | $ | 15,191,460 | $ | 17,386,142 | ||||||
| Liabilities and shareholders' equity | ||||||||||
| Current liabilities: | ||||||||||
| Note payable to Forward China | $ | 750,000 | $ | - | ||||||
| Accounts payable | 147,518 | 518,892 | ||||||||
| Due to Forward China | 8,687,898 | 8,246,015 | ||||||||
| Deferred income | 228,827 | 297,407 | ||||||||
| Current portion of operating lease liability | 423,042 | 416,042 | ||||||||
| Accrued expenses and other current liabilities | 560,494 | 1,357,743 | ||||||||
| Total current liabilities | 10,797,779 | 10,836,099 | ||||||||
| Other liabilities: | ||||||||||
| Note payable to Forward China | - | 1,100,000 | ||||||||
| Operating lease liability, less current portion | 2,623,814 | 2,833,782 | ||||||||
| Total other liabilities | 2,623,814 | 3,933,782 | ||||||||
| Total liabilities | 13,421,593 | 14,769,881 | ||||||||
| Commitments and contingencies | ||||||||||
| Shareholders' equity: | ||||||||||
| Common stock, par value | ||||||||||
| 10,061,185 shares issued and outstanding at March 31, 2024 | ||||||||||
| and September 30, 2023 | 100,612 | 100,612 | ||||||||
| Additional paid-in capital | 20,263,242 | 20,202,202 | ||||||||
| Accumulated deficit | (18,593,987 | ) | (17,686,553 | ) | ||||||
| Total shareholders' equity | 1,769,867 | 2,616,261 | ||||||||
| Total liabilities and shareholders' equity | $ | 15,191,460 | $ | 17,386,142 | ||||||
| FORWARD INDUSTRIES, INC. AND SUBSIDIARIES | |||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||
| (UNAUDITED) | |||||||||||||||
| For the Three Months Ended March 31, | For the Six Months Ended March 31, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Revenues, net | $ | 7,830,130 | $ | 9,738,804 | $ | 14,982,080 | $ | 19,491,488 | |||||||
| Cost of sales | 6,222,432 | 7,813,696 | 11,731,897 | 15,600,310 | |||||||||||
| Gross profit | 1,607,698 | 1,925,108 | 3,250,183 | 3,891,178 | |||||||||||
| Sales and marketing expenses | 370,839 | 450,380 | 739,575 | 861,554 | |||||||||||
| General and administrative expenses | 1,776,491 | 1,566,549 | 3,430,561 | 3,249,360 | |||||||||||
| Operating loss | (539,632 | ) | (91,821 | ) | (919,953 | ) | (219,736 | ) | |||||||
| Fair value adjustment of earnout consideration | - | - | - | (40,000 | ) | ||||||||||
| Interest income | (18,712 | ) | (856 | ) | (36,180 | ) | (856 | ) | |||||||
| Interest expense | 16,971 | 26,781 | 35,981 | 54,739 | |||||||||||
| Other income, net | 7,846 | 965 | 7,158 | (23,595 | ) | ||||||||||
| Loss from continuing operations before income taxes | (545,737 | ) | (118,711 | ) | (926,912 | ) | (210,024 | ) | |||||||
| Provision for income taxes | - | - | - | - | |||||||||||
| Loss from continuing operations | (545,737 | ) | (118,711 | ) | (926,912 | ) | (210,024 | ) | |||||||
| (Loss) / income from discontinued operations, net of tax | (7,477 | ) | (752,237 | ) | 19,478 | (1,091,199 | ) | ||||||||
| Net loss | $ | (553,214 | ) | $ | (870,948 | ) | $ | (907,434 | ) | $ | (1,301,223 | ) | |||
| Basic loss per share : | |||||||||||||||
| Basic loss per share from continuing operations | $ | (0.05 | ) | $ | (0.01 | ) | $ | (0.09 | ) | $ | (0.02 | ) | |||
| Basic loss per share from discontinued operations | (0.00 | ) | (0.07 | ) | 0.00 | (0.11 | ) | ||||||||
| Basic loss per share | $ | (0.05 | ) | $ | (0.09 | ) | $ | (0.09 | ) | $ | (0.13 | ) | |||
| Diluted loss per share: | |||||||||||||||
| Diluted loss per share from continuing operations | $ | (0.05 | ) | $ | (0.01 | ) | $ | (0.09 | ) | $ | (0.02 | ) | |||
| Diluted loss per share from discontinued operations | (0.00 | ) | (0.07 | ) | 0.00 | (0.11 | ) | ||||||||
| Diluted loss per share | $ | (0.05 | ) | $ | (0.09 | ) | $ | (0.09 | ) | $ | (0.13 | ) | |||
| 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 | |||||||||||
FAQ
What were Forward Industries, Inc. (NASDAQ:FORD) second quarter fiscal year 2024 revenues?
What was the loss from continuing operations for Forward Industries, Inc. (NASDAQ:FORD) in the second quarter of fiscal year 2024?
What was the net loss for Forward Industries, Inc. (NASDAQ:FORD) in the second quarter of fiscal year 2024?
What was the cash balance for Forward Industries, Inc. (NASDAQ:FORD) as of March 31, 2024?
What did CEO Terry Wise highlight in the press release regarding Forward Industries, Inc. (NASDAQ:FORD)?
