Polar Power Reports Second Quarter 2023 Financial Results
GARDENA, CA, Aug. 14, 2023 (GLOBE NEWSWIRE) -- Polar Power, Inc. (“Polar Power” or the “Company”) (NASDAQ: POLA), a global provider of prime, backup and solar hybrid DC power solutions, today reported its financial results for the three and six months ended June 30, 2023.
Key Q2 2023 Results and Highlights:
Financial Results for the Three and Six Months Ended June 30, 2023
• Net sales for Q2 2023 were
• Gross profit during the Q2 2023 increased
• Operating expenses remained constant at
• Net loss for Q2 2023 totaled
• Cash and cash equivalents at June 30, 2023 were
• Backlog as of the end of Q2 2023 was
Management Commentary
The Company’s net sales increased
For the six months ended June 30, 2023, the Company’s net sales increased
The Company’s ongoing sales and marketing efforts overseas resulted in an increase of approximately
Telecommunications customers in international markets are primarily purchasing the Company’s DC generators for off-grid (i.e., areas where wireless towers are not connected to an electrical grid) and bad-grid (i.e., areas where wireless towers are connected to an electrical grid that loses power more than eight hours) applications. The Company’s solar hybrid power systems, which integrate solar energy storage with natural gas/LPG powered generators, are ideal for off-grid and bad-grid applications. The Company’s backlog as of June 30, 2023, includes approximately
The Company believes the implementation and ongoing development of 5G networks along with programs to develop the telecommunications infrastructure in rural and underdeveloped countries will continue to fuel the Company’s growth in the telecommunications market over the next five to ten years.
The Company launched the Toyota 1KS during Q1 2023. The Company believes the Toyota prime power engines, when configured into generators, will provide strong opportunities for growth and diversification in line with the Company’s long-term plan. This engine platform is expected to easily facilitate the shift from diesel to natural gas and LPG (liquid petroleum gas, aka propane or butane). LPG and natural gas fuel reduce carbon emissions between
Company has purchased a large number of Toyota engines over the last three years in anticipation of launching the Toyota engine, requiring significant working capital, but believes it is well positioned to meet anticipated demand. This inventory is expected to convert back to cash as product sales accelerate. As a hedge against the world supply chain problems, Polar Power has maintained large inventory levels on critical items.
The Company is in the process of upgrading its mobile EV charging systems to the universal combined charging system standard (CCS) to reach the mobile EV charging market. The Company is taking orders for the Company’s new line of EV chargers and expects to have them available before the end of the first quarter of 2024. Mobile EV chargers are used for emergency roadside service, providing a fast-charging solution for EVs that have run out of charge before reaching a stationary charging facility.
About Polar Power, Inc.
Gardena, California-based Polar Power, Inc. (NASDAQ: POLA), designs, manufactures and sells direct current, or DC, power systems, lithium battery powered hybrid solar systems for applications in the telecommunications market and, in other markets, including military, EV charging, cogeneration, distributed power and uninterruptable power supply. Within the telecommunications market, Polar Power’s systems provide reliable and low-cost energy for applications for off-grid and bad-grid applications with critical power needs that cannot be without power in the event of utility grid failure. For more information, please visit www.polarpower.com. or follow us on www.linkedin.com/company/polar-power-inc/.
Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
This news release contains certain statements of a forward-looking nature relating to future events or future business performance. Forward-looking statements can be identified by the words “expects,” “anticipates,” “believes,” “intends,” “estimates,” “plans,” “will,” “outlook” and similar expressions. Forward-looking statements are based on management’s current plans, estimates, assumptions and projections, and speak only as of the date they are made. With the exception of historical information, the matters discussed in this press release including, without limitation, Polar Power’s belief that the implementation and ongoing development of 5G networks along with programs to develop the telecommunications infrastructure in rural and underdeveloped countries will continue to fuel the Company’s growth in the telecommunications market over the next five to ten years; Polar Power’s belief that Toyota prime power engines will provide strong opportunities for growth and diversification; Polar Power’s expectation that its line of EV chargers will be available in the year 2024; and Polar Power’s expectations that it’s large investments in inventory, including engines, will convert back to cash as product sales accelerate are forward-looking statements and considerations that involve a number of risks and uncertainties. The actual future results of Polar Power could differ from those statements. Factors that could cause or contribute to such differences include, but are not limited to, adverse domestic and foreign economic and market conditions, including demand for its solar hybrid power systems and mobile EV chargers; trade tariffs on raw materials; changes in domestic and foreign governmental regulations and policies; the impact of inflation and changing prices on raw materials; supply chain constraints causing significant delays in sourcing raw materials; labor shortages as a result of the pandemic, low unemployment rates, or other factors limiting the availability of qualified workers; and other events, factors and risks. It undertakes no obligation to update any forward-looking statement in light of new information or future events, except as otherwise required by law. Forward-looking statements involve inherent risks and uncertainties, most of which are difficult to predict and are generally beyond Polar Power’s control. Actual results or outcomes may differ materially from those implied by the forward-looking statements as a result of the impact of a number of factors, many of which are discussed in more detail in Polar Power’s reports filed with the Securities and Exchange Commission.
Company Contact:
Polar Power, Inc.
249 E. Gardena Blvd.
Gardena, CA 90248
Tel: 310-830-9153
ir@polarpowerinc.com
www.polarpower.com
POLAR POWER, INC.
CONDENSED BALANCE SHEETS
(in thousands, except share and per share data)
June 30, 2023 | December 31, 2022 | |||||||
(Unaudited) | ||||||||
ASSETS | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 292 | $ | 211 | ||||
Accounts receivable | 3,718 | 2,230 | ||||||
Inventories, net | 17,689 | 15,460 | ||||||
Prepaid expenses | 1,050 | 2,629 | ||||||
Employee retention credit receivable | 2,000 | 2,000 | ||||||
Income taxes receivable | 787 | 787 | ||||||
Total current assets | 25,536 | 23,317 | ||||||
Other assets: | ||||||||
Operating lease right-of-use assets, net | 2,178 | 240 | ||||||
Property and equipment, net | 505 | 538 | ||||||
Deposits | 93 | 93 | ||||||
Total assets | $ | 28,312 | $ | 24,188 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current liabilities | ||||||||
Accounts payable | $ | 1,429 | $ | 230 | ||||
Customer deposits | 1,535 | 2,126 | ||||||
Accrued liabilities and other current liabilities | 1,242 | 1,231 | ||||||
Operating lease liabilities, current portion | 717 | 268 | ||||||
Notes payable-related party, current portion | 160 | — | ||||||
Notes payable, current portion | 135 | 211 | ||||||
Line of credit | 4,927 | 1,884 | ||||||
Total current liabilities | 10,145 | 5,950 | ||||||
Notes payable, net of current portion | 8 | 57 | ||||||
Operating lease liabilities, net of current portion | 1,527 | — | ||||||
Total liabilities | 11,680 | 6,007 | ||||||
Commitments and Contingencies | ||||||||
Stockholders’ Equity | ||||||||
Preferred stock, | — | — | ||||||
Common stock, | 1 | 1 | ||||||
Additional paid-in capital | 37,331 | 37,331 | ||||||
Accumulated deficit | (20,660 | ) | (19,111 | ) | ||||
Treasury Stock, at cost (17,477 shares) | (40 | ) | (40 | ) | ||||
Total stockholders’ equity | 16,632 | 18,181 | ||||||
Total liabilities and stockholders’ equity | $ | 28,312 | $ | 24,188 |
POLAR POWER, INC.
UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
Net Sales | $ | 5,587 | $ | 4,274 | $ | 9,777 | $ | 7,983 | ||||||||
Cost of Sales | 4,112 | 3,213 | 7,548 | 6,017 | ||||||||||||
Gross profit | 1,475 | 1,061 | 2,229 | 1,966 | ||||||||||||
Operating Expenses | ||||||||||||||||
Sales and marketing | 310 | 400 | 642 | 805 | ||||||||||||
Research and development | 338 | 350 | 684 | 826 | ||||||||||||
General and administrative | 1,137 | 1,036 | 2,248 | 2,167 | ||||||||||||
Total operating expenses | 1,785 | 1,786 | 3,574 | 3,798 | ||||||||||||
Loss from operations | (310 | ) | (725 | ) | (1,345 | ) | (1,832 | ) | ||||||||
Other income (expenses) | ||||||||||||||||
Interest expense and finance costs | (126 | ) | (14 | ) | (204 | ) | (27 | ) | ||||||||
Total other income (expenses), net | (126 | ) | (14 | ) | (204 | ) | (27 | ) | ||||||||
Net loss | $ | (436 | ) | $ | (739 | ) | $ | (1,549 | ) | $ | (1,859 | ) | ||||
Net loss per share – basic and diluted | $ | (0.03 | ) | $ | (0.06 | ) | $ | (0.12 | ) | $ | (0.15 | ) | ||||
Weighted average shares outstanding, basic and diluted | 12,949,550 | 12,788,203 | 12,949,550 | 12,788,203 |
POLAR POWER, INC.
UNAUDITED CONDENSED STATEMENTS OF CASH FLOW
(in thousands)
Six Months Ended June 30, | ||||||||
2023 | 2022 | |||||||
Cash flows from operating activities: | ||||||||
Net loss | $ | (1,549 | ) | $ | (1,859 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation and amortization | 226 | 264 | ||||||
Changes in operating assets and liabilities | ||||||||
Accounts receivable | (1,488 | ) | 249 | |||||
Inventories | (2,229 | ) | (2,968 | ) | ||||
Prepaid expenses | 1,579 | (380 | ) | |||||
Decrease in operating lease right-of-use asset | 454 | 334 | ||||||
Accounts payable | 1,199 | (193 | ) | |||||
Customer deposits | (591 | ) | 2,588 | |||||
Accrued expenses and other current liabilities | 11 | 8 | ||||||
Decrease in operating lease liability | (416 | ) | (354 | ) | ||||
Net cash used in operating activities | (2,804 | ) | (2,311 | ) | ||||
Cash flows from investing activities: | ||||||||
Acquisition of property and equipment | (194 | ) | (15 | ) | ||||
Net cash used in investing activities | (194 | ) | (15 | ) | ||||
Cash flows from financing activities: | ||||||||
Proceeds from advances from credit facility | 3,044 | — | ||||||
Proceeds from notes payable, related party | 160 | — | ||||||
Repayment of notes payable | (125 | ) | (119 | ) | ||||
Net cash provided by (used in) financing activities | 3,079 | (119 | ) | |||||
Increase (decrease) in cash and cash equivalents | 81 | (2,445 | ) | |||||
Cash and cash equivalents, beginning of period | 211 | 5,101 | ||||||
Cash and cash equivalents, end of period | $ | 292 | $ | 2,656 |