Upexi Revenue Increases 199% Year-Over-Year to $11.6 Million for Fiscal 2023 First Quarter
HENDERSON, Nev., Nov. 14, 2022 /PRNewswire/ -- Upexi, Inc. (NASDAQ: UPXI) (the "Company" or "Upexi"), a multi-faceted Amazon and Direct to Consumer brand owner and innovator in aggregation, today announced its financial results for the fiscal 2023 first quarter ending September 30, 2022.
- Revenue totaled $11.6 million, an increase of 199% year-over-year.
- Gross profit totaled $6 million, an increase of 132% year-over-year.
- Gross profit margin was 52%.
- Net loss from continued operations was $2.7 million compared to net income of approximately $512,000 for the same period in the prior year.
- Cash and cash equivalents totaled $3.3 million as of September 30, 2022.
"Our revenue growth year-over-year was predominantly driven by multiple accretive acquisitions. Moving forward, our growth strategy will continue to focus on both acquisitions and organic growth, while also expanding to international markets," said Allan Marshall, Upexi's Chief Executive Officer. "During the quarter we entered the more than $200 billion pet market through the acquisition of LuckyTail, a balanced business, with direct-to-consumer and Amazon distribution, and double-digit year-over-year growth. Going forward, our acquisition pipeline remains robust with valuations in line with our strategic guidelines. We have made significant strides over the last two years and the Company today is in the best position for growth and profitability in its history, with approximately $100 million in sales projected for calendar 2023."
- Acquired international pet care brand, LuckyTail, Inc.
- Saas ad-tech division, Interactive Offers, filed a patent for its single click-to-opt-in technology.
- Closed on sale of select CBD assets for $23.5 million.
- Closed on acquisition of E-Core and its subsidiaries, Tytan Products, a children's toy brand and maker of popular magnetic tiles and building blocks, and New England Technology, Inc., a national distributor for branded consumer products.
- Eliminated outstanding balance of $15 million senior secured debt facility with expectation to reduce annualized interest expense by approximately $900,000.
Revenue for the three months ended September 30, 2022 totaled $11.6 million, an increase of 199% as compared to $3.9 million for the same period the year prior. The revenue growth was primarily driven by four acquisitions, including VitaMedica, Interactive, Cygnet, and LuckyTail, and offset by the sale of Infusionz. The Company's growth strategy will continue to focus on both acquisition and organic growth, while also expanding to international markets.
Cost of revenue during the quarter totaled $5.5 million, an increase of 334% as compared to $1.3 million for the same period the prior year. The cost of revenue increase was primarily related to the acquisition of four companies and offset with the sale of Infusionz.
Gross profit for the quarter was $6 million, an increase of $3.4 million compared to the same period in the prior year. Gross margins declined to 52% as a result of significant increases in lower margin sales to distributors and the use of third-party distribution of our direct-to-consumer sales.
Operating expenses totaled $9 million, an increase of 159% as compared to $3.5 million for the same period in the prior fiscal year. This was primarily related to a $ 1 million increase in sales, an increase in distribution costs, including the use of third-party distributors of $2.4 million, an increase in general and administrative costs of $900,000 to support the growth of the business, and an increase of $1.2 million increase in non-cash expenses of share-based compensation, the amortization of acquired intangible assets and depreciation. These costs were offset by the sale of Infusionz and the classification of these expenses as part of discontinued operations.
The Company had a net loss from continued operations of $2.7 million compared to net income of approximately $512,000 for the three months ended September 30, 2022 and 2021, respectively. The decrease in net income is primarily related to the above-mentioned changes.
The Company had cash and cash equivalents of $3.3 million and stockholders' equity of $27 million as of September 30, 2022. As of November 11, 2022 there were 17,960,748 shares of common stock outstanding.
Event: | Upexi Fiscal 2023 First Quarter Financial Results Conference Call |
Date: | Monday, November 14, 2022 |
Time: | 4:30 p.m. Eastern Time |
Live Call: | 1-877-550-1707 (U.S. Toll-Free) or 1-848-488-9020 (International) |
Webcast: | https://viavid.webcasts.com/starthere.jsp?ei=1580183&tp_key=e897d16fbb |
For interested individuals unable to join the conference call, a dial-in replay of the call will be available until November 28, 2022 and can be accessed by dialing + 1-844-512-2921 (U.S. Toll Free) or + 1-412-317-6671 (International) and entering replay pin number: 11152754.
Additional details are available under the Investor Relations section of the Company's website: https://upexi.com/investors.
Upexi is a multi-faceted brand owner with established brands in the health, wellness, pet, beauty and other growing markets. We operate in emerging industries with high growth trends and look to drive organic growth of our current brands. We focus on direct to consumer and Amazon brands that are scalable and have anticipated, high industry growth trends. Our goal is to continue to accumulate consumer data and build out a significant customer database across all industries we sell into. The growth of our current database has been key to the year over year gains in sales and profits. To drive additional growth, we have and will continue to acquire profitable Amazon and eCommerce businesses that can scale quickly and reduce costs through corporate synergies. We utilize our in-house, SaaS programmatic ad technology to help achieve a lower cost per acquisition and accumulate consumer data for increased cross-selling between our growing portfolio of brands.
This news release contains "forward-looking statements" as that term is defined in Section 27A of the United States Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Statements in this press release which are not purely historical are forward-looking statements and include any statements regarding beliefs, plans, expectations or intentions regarding the future. Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others, the inherent uncertainties associated with business strategy, potential acquisitions, revenue guidance, product development, integration and synergies of acquiring companies and personnel. These forward-looking statements are made as of the date of this news release, and we assume no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements. Although we believe that the beliefs, plans, expectations and intentions contained in this press release are reasonable, there can be no assurance that such beliefs, plans, expectations or intentions will prove to be accurate. Investors should consult all of the information set forth herein and should also refer to the risk factors disclosure outlined in our annual report on Form 10-K and other periodic reports filed from time-to-time with the Securities and Exchange Commission.
Company Contact
Andrew Norstrud, Chief Financial Officer
Email: andrew.norstrud@upexi.com
Phone: (702) 332-5591
Investor Relations Contact
KCSA Strategic Communications
Valter Pinto or Jack Perkins
Email: Upexi@KCSA.com
Phone: (212) 896-1254
UPEXI, INC. |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) |
Three Months Ended September 30, | ||||||||
2022 | 2021 | |||||||
Revenue | ||||||||
Revenue | $ | 11,557,011 | $ | 3,870,110 | ||||
Cost of Revenue | 5,516,280 | 1,271,729 | ||||||
Gross profit | 6,040,731 | 2,598,381 | ||||||
Operating expenses | ||||||||
Sales and marketing | 2,025,460 | 1,000,064 | ||||||
Distribution costs | 2,487,834 | 111,833 | ||||||
General and administrative expenses | 2,498,869 | 1,582,432 | ||||||
Share-based compensation | 927,326 | 626,838 | ||||||
Amortization of acquired intangible assets | 880,896 | 68,834 | ||||||
Depreciation | 194,497 | 87,506 | ||||||
9,014,882 | 3,477,507 | |||||||
Loss from operations | (2,974,151) | (879,126) | ||||||
Other expense (income), net | ||||||||
Change in derivative liability | (1,770) | - | ||||||
Interest expense, net | 435,829 | 15,538 | ||||||
Other expense (income), net | 434,059 | 15,538 | ||||||
Loss from operations before income tax | (3,408,210) | (894,664) | ||||||
(Loss) income from discontinued operations | (45,511) | 1,147,472 | ||||||
Income tax benefit | 708,201 | 258,903 | ||||||
Net (loss) income from continuing operations | (2,745,520) | 511,711 | ||||||
Net loss attributable to noncontrolling interest | 148,005 | - | ||||||
Net (loss) income attributable to Upexi, Inc. | $ | (2,597,515) | $ | 511,711 | ||||
Basic (loss) income per share: | ||||||||
(Loss) income per share from continuing operations | $ | (0.16) | $ | 0.03 | ||||
(Loss) income per share from discontinued operations | $ | (0.00) | $ | 0.07 | ||||
Total (loss) income per share | $ | (0.16) | $ | 0.03 | ||||
Diluted (loss) income per share: | ||||||||
(Loss) income per share from continuing operations | $ | (0.16) | $ | 0.03 | ||||
(Loss) income per share from discontinued operations | $ | (0.00) | $ | 0.07 | ||||
Total (loss) income per share | $ | (0.16) | $ | 0.03 | ||||
Basic weighted average shares outstanding | 16,713,345 | 15,452,453 | ||||||
Fully diluted weighted average shares outstanding | 16,713,345 | 17,220,564 | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
UPEXI, INC. | ||||||||
CONDENSED CONSOLDIATED BALANCE SHEETS (UNAUDITED) | ||||||||
September 30, | June 30, | |||||||
2022 | 2022 | |||||||
ASSETS | ||||||||
Current assets | ||||||||
Cash | $ | 3,298,663 | $ | 7,149,806 | ||||
Accounts receivable | 1,315,933 | 1,137,637 | ||||||
Inventory | 6,090,242 | 4,725,685 | ||||||
Deferred tax asset, current | 462,070 | 462,070 | ||||||
Prepaid expenses and other receivables | 1,231,941 | 840,193 | ||||||
Assets of discontinued operations, net | 6,404,209 | 6,157,543 | ||||||
Total current assets | 18,803,058 | 20,472,934 | ||||||
Property and equipment, net | 7,367,844 | 7,343,783 | ||||||
Intangible assets, net | 12,716,153 | 10,933,049 | ||||||
Goodwill | 6,223,393 | 5,887,393 | ||||||
Deferred tax asset | 2,732,242 | 2,002,759 | ||||||
Other assets | 413,956 | 100,372 | ||||||
Right-of-use asset | 843,901 | 926,570 | ||||||
Total other assets | 30,297,489 | 27,193,926 | ||||||
Total assets | $ | 49,100,547 | $ | 47,666,860 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
Current liabilities | ||||||||
Accounts payable | $ | 2,092,122 | $ | 2,018,541 | ||||
Accrued compensation | 695,278 | 531,259 | ||||||
Deferred revenue | 120,973 | 105,848 | ||||||
Accrued liabilities | 1,769,989 | 955,327 | ||||||
Acquisition payable | 1,351,589 | - | ||||||
Current portion of notes payable | 5,424,752 | 5,424,752 | ||||||
Current portion of operating lease payable | 274,847 | 257,029 | ||||||
Total current liabilities | 11,729,550 | 9,292,756 | ||||||
Notes payable, net of current portion | 9,743,104 | 8,886,949 | ||||||
Operating lease payable, net of current portion | 588,993 | 700,411 | ||||||
Total long-term liabilities | 10,332,097 | 9,587,360 | ||||||
Commitments and contingencies | - | - | ||||||
Stockholders' equity | ||||||||
Preferred stock, $0.001 par value, 100,000,000 shares authorized, and 500,000 and 500,000 shares issued and outstanding, respectively | 500 | 500 | ||||||
Common stock, $0.001 par value, 100,000,000 shares authorized, and 16,713,345 and 16,713,345 shares issued and outstanding, respectively | 16,713 | 16,713 | ||||||
Additional paid in capital | 35,983,273 | 34,985,597 | ||||||
Accumulated deficit | (8,868,401) | (6,270,886) | ||||||
Total stockholders' equity attributable to Upexi, Inc. | 27,132,085 | 28,731,924 | ||||||
Non-controlling interest in subsidiary | (93,185) | 54,820 | ||||||
Total stockholders' equity | 27,038,900 | 28,786,744 | ||||||
Total liabilities and stockholders' equity | $ | 49,100,547 | $ | 47,666,860 | ||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
SOURCE Upexi, Inc.
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