• iPower Reports Fiscal Fourth Quarter and Full Year 2024 Results

    Source: Nasdaq GlobeNewswire / 19 Sep 2024 16:05:00   America/New_York

    Optimization Initiatives Drive Material Gross Margin Expansion
    and Second Consecutive Quarter of Profitability

    iPower Management to Host Conference Call Today at 4:30 p.m. Eastern Time

    RANCHO CUCAMONGA, Calif., Sept. 19, 2024 (GLOBE NEWSWIRE) -- iPower Inc. (Nasdaq: IPW) (“iPower” or the “Company”), a tech and data-driven online retailer and supplier of consumer home, pet and garden products, as well as a provider of value-added ecommerce services, today announced its financial results for the fiscal fourth quarter and full fiscal year ended June 30, 2024.

    Fiscal Q4 2024 Results vs. Year-Ago Quarter 

    • Total revenue was $19.5 million compared to $23.4 million.
    • Gross profit increased 2% to $9.2 million, with gross margin up 870 bps to 47.4% compared to 38.7%.
    • Net income attributable to iPower increased to $0.7 million or $0.02 per share, compared to net loss attributable to iPower of $3.0 million or $(0.10) per share.
    • Adjusted net income attributable to iPower (a non-GAAP financial measure defined below) improved to $0.9 million or $0.03 per share, compared to adjusted net loss attributable to iPower of $2.1 million or $(0.07) per share.
    • As of June 30, 2024, total debt was reduced by 46% to $6.3 million compared to $11.8 million as of June 30, 2023.

    Fiscal 2024 Results vs. Fiscal 2023

    • Total revenue was $86.1 million compared to $88.9 million.
    • Gross profit increased 13% to $39.3 million, with gross margin up 650 bps to 45.6% compared to 39.1%.
    • Net loss attributable to iPower improved to $1.5 million or $(0.05) per share, compared to net loss attributable to iPower of $12.0 million or $(0.40) per share. The fiscal 2023 period includes approximately $3 million related to a goodwill impairment.
    • Adjusted net loss attributable to iPower (a non-GAAP financial measure defined below) improved to $0.2 million or $(0.01) per share, compared to adjusted net loss attributable to iPower of $7.5 million or $(0.25) per share.

    Management Commentary 

    “I’m proud of our team’s hard work in fiscal 2024 to drive record levels of gross margin, operating expense reductions and another year of positive cash flow from operations,” said Lawrence Tan, CEO of iPower. “Throughout the year, we delivered on multiple strategic initiatives to lay the foundation for future growth and profitability. We expanded channel distribution by launching sales on new platforms like TikTok Shop and Temu, both of which have seen promising early results. We’ve also strengthened the capabilities and resilience of our supply chain through partnerships with suppliers in South East Asia. We will remain focused on evaluating each aspect of our business to ensure we’re providing a best-in-class service to both our current and future customers.

    “We also continued to elevate our SuperSuite supply chain business by integrating key components from value-added partners across logistics, technology and marketing to enhance our service offerings. We believe that this collaborative approach has positioned SuperSuite as a leader in supply chain management, merchandising and warehousing, attracting a diverse network of new customers and partners. We are working through a robust pipeline of prospective partners and look forward to capitalizing on the growing demand for SuperSuite as we continue to build out our partner ecosystem.”

    iPower CFO, Kevin Vassily, added, “The optimization initiatives we implemented earlier this year are yielding results, enabling us to achieve material gross margin expansion and our second consecutive quarter of profitability in fiscal Q4. Additionally, we made significant improvements to our balance sheet as we reduced total debt by approximately $5.5 million compared to the close of fiscal 2023. We are pleased with the progress we made this year and look forward to delivering on our goals in fiscal 2025.”

    Fiscal Fourth Quarter 2024 Financial Results 

    Total revenue in the fiscal fourth quarter of 2024 was $19.5 million compared to $23.4 million for the same period in fiscal 2023. The decrease was driven primarily by higher promotional activity in the year-ago period related to selling down inventory. This was partially offset by growth in iPower’s SuperSuite supply chain offerings.

    Gross profit in the fiscal fourth quarter of 2024 increased 2% to $9.2 million compared to $9.1 million in the same quarter in fiscal 2023. As a percentage of revenue, gross margin increased 870 basis points to 47.4% compared to 38.7% in the year-ago period. The increase in gross margin was primarily driven by improved pricing through key supplier negotiations and favorable product mix.

    Total operating expenses in the fiscal fourth quarter of 2024 improved 34% to $8.0 million compared to $12.0 million for the same period in fiscal 2023. As a percentage of revenue, operating expenses improved 1,050 basis points to 41.0% compared to 51.5% in the year-ago period. The decrease in operating expenses was driven primarily by lower selling and fulfillment expenses resulting from a combination of lower marketing and promotional activity, as well as credits from certain vendors.

    Net income attributable to iPower in the fiscal fourth quarter of 2024 improved to $0.7 million or $0.02 per share, compared to net loss attributable to iPower of $3.0 million or $(0.10) per share for the same period in fiscal 2023.

    Adjusted net income attributable to iPower (a non-GAAP financial measure defined below), which excludes legal fees for arbitration net of tax impact, improved to $0.9 million or $0.03 per share in the fiscal fourth quarter of 2024 compared to adjusted net loss attributable to iPower of $2.1 million or $(0.07) per share in the year-ago period.

    Cash and cash equivalents were $7.4 million at June 30, 2024, compared to $3.7 million at June 30, 2023. As a result of the Company’s debt paydown, total debt was reduced by 46% to $6.3 million compared to $11.8 million as of June 30, 2023.

    Conference Call 

    The Company will hold a conference call today, September 19, 2024, at 4:30 p.m. Eastern Time to discuss its results for the fiscal fourth quarter and full fiscal year ended June 30, 2024.

    iPower’s management will host the conference call, which will be followed by a question-and-answer session.

    The conference call details are as follows:

    Date: Thursday, September 19, 2024
    Time: 4:30 p.m. Eastern Time
    Dial-in registration link: here
    Live webcast registration link: here

    Please dial into the conference call 5-10 minutes prior to the start time. If you have any difficulty connecting with the conference call, please contact the Company’s investor relations team at IPW@elevate-ir.com.

    The conference call will also be broadcast live and available for replay in the Events & Presentations section of the Company’s website at www.meetipower.com.

    About iPower Inc. 

    iPower Inc. is a tech and data-driven online retailer and supplier of consumer home, pet and garden products, as well as a provider of value-added ecommerce services for third-party products and brands. iPower's capabilities include a full spectrum of online channels, robust fulfillment capacity, a network of warehouses serving the U.S., competitive last mile delivery partners and a differentiated business intelligence platform. iPower believes that these capabilities will enable it to efficiently move a diverse catalog of SKUs from its supply chain partners to end consumers every day, providing the best value to customers in the U.S. and other countries. For more information, please visit iPower's website at www.meetipower.com.

    Non-GAAP Financial Measures

    iPower has disclosed non-GAAP net income/(loss) and non-GAAP earnings per share in this press release, which are non-GAAP financial measures as defined by SEC Regulation G. The Company defines non-GAAP net income/(loss) as net income excluding legal fees for arbitration net of tax impact. A table providing a reconciliation of non-GAAP net income/(loss) and non-GAAP EPS is included at the end of this press release.

    The Company's management believes that presenting non-GAAP net income/(loss) and non-GAAP EPS provides useful information to investors regarding the underlying business trends and performance of the Company's ongoing operations, as well as providing for more consistent period-over-period comparisons. This non-GAAP measure assists management in its operational and financial decision-making, as well as monitoring the Company's performance, non-GAAP net income/(loss) and non-GAAP EPS are used in addition to and in conjunction with results presented in accordance with GAAP and should not be relied upon to the exclusion of GAAP financial measures.

    Our non-GAAP net income/(loss) and non-GAAP earnings per share are not measurements of financial performance under GAAP and should not be considered as an alternative to operating or net income or as an indication of operating performance or any other measure of performance derived in accordance with GAAP. We do not consider these non-GAAP measures to be a substitute for, or superior to, the information provided by GAAP financial results. Non-GAAP financial measures are subject to limitations and should be read only in conjunction with the Company’s consolidated financial statements prepared in accordance with GAAP. We believe that these non-GAAP measures have limitations in that they do not reflect all of the amounts associated with our GAAP results of operations. We compensate for the limitations of non-GAAP financial measures by relying upon GAAP results to gain a complete picture of our performance.
    Management strongly encourages investors to review the Company's consolidated financial statements in their entirety and to not rely on any single financial measure.

    Forward-Looking Statements 

    All statements other than statements of historical fact in this press release are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations and projections about future events and financial trends that iPower believes may affect its financial condition, results of operations, business strategy, and financial needs. Investors can identify these forward-looking statements by words or phrases such as "may," "will," "expect," "anticipate," "aim," "estimate," "intend," "plan," "believe," "potential," "continue," "is/are likely to" or other similar expressions. iPower undertakes no obligation to update forward-looking statements to reflect subsequent events or circumstances, or changes in its expectations, except as may be required by law. Although iPower believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and iPower cautions investors that actual results may differ materially from the anticipated results and encourages investors to review other factors that may affect its future results and performance in iPower's Annual Report on Form 10-K, as filed with the SEC on September 19, 2024, its Quarterly Reports on Form 10-Q, as filed with the SEC on November 15, 2023, February 14, 2024 and May 14, 2024, and in its other SEC filings.

    Investor Relations Contact

    Sean Mansouri, CFA or Aaron D’Souza
    Elevate IR
    (720) 330-2829
    IPW@elevate-ir.com

    iPower Inc. and Subsidiaries
    Consolidated Balance Sheets
    As of June 30, 2024 and 2023
     
      June 30, June 30,
      2024  2023 
          
    ASSETS      
    Current assets      
    Cash and cash equivalent $7,377,837  $3,735,642 
    Accounts receivable, net  14,740,093   14,071,543 
    Inventories, net  10,546,273   20,593,889 
    Prepayments and other current assets, net  2,346,534   2,858,196 
    Total current assets  35,010,737   41,259,270 
           
    Non-current assets      
    Right of use - non-current  6,124,163   7,837,345 
    Property and equipment, net  370,887   536,418 
    Deferred tax assets, net  2,445,605   2,155,250 
    Goodwill  3,034,110   3,034,110 
    Intangible assets, net  3,630,700   4,280,071 
    Other non-current assets  679,655   991,823 
    Total non-current assets  16,285,120   18,835,017 
           
    Total assets $51,295,857  $60,094,287 
           
    LIABILITIES AND EQUITY      
    Current liabilities      
    Accounts payable  11,227,116   13,244,957 
    Other payables and accrued liabilities  3,885,487   5,548,443 
    Advance from shareholders  -   85,200 
    Lease liability - current  2,039,301   2,159,173 
    Short-term loan payable  491,214   - 
    Short-term loan payable - related party  350,000   - 
    Long-term promissory note payable - current portion  -   2,017,852 
    Revolving loan payable  5,500,739   - 
    Income taxes payable  276,158   276,683 
    Total current liabilities  23,770,015   23,332,308 
           
    Non-current liabilities      
    Long-term revolving loan payable, net  -   9,791,191 
    Lease liability - non-current  4,509,809   6,106,047 
           
    Total non-current liabilities  4,509,809   15,897,238 
           
    Total liabilities  28,279,824   39,229,546 
           
    Commitments and contingency  -   - 
           
    Stockholders' Equity      
    Preferred stock, $0.001 par value; 20,000,000 shares authorized; 0 shares issued and      
      outstanding at June 30, 2024 and 2023  -   - 
    Common stock, $0.001 par value; 180,000,000 shares authorized; 31,359,899 and      
      29,710,939 shares issued and outstanding at June 30, 2024 and 2023  31,361   29,712 
    Additional paid in capital  33,463,883   29,624,520 
    Accumulated deficits  (10,230,601)  (8,702,442)
    Non-controlling interest  (38,204)  (24,915)
    Accumulated other comprehensive loss  (210,406)  (62,134)
    Total stockholders' equity  23,016,033   20,864,741 
           
    Total liabilities and stockholders' equity $51,295,857  $60,094,287 
           



    iPower Inc. and Subsidiaries
     Consolidated Statements of Operations and Comprehensive Loss
    For the Three Months and Years Ended June 30, 2024 and 2023
     
      For the Three Months Ended June 30, For the Years Ended June 30,
      2024  2023  2024  2023 
      (Unaudited) (Unaudited)    
               
    REVENUES $19,454,481  $23,399,166  $86,071,485  $88,902,048 
                 
    TOTAL REVENUES  19,454,481   23,399,166   86,071,485   88,902,048 
                 
    COST OF REVENUES  10,226,651   14,348,668   46,818,232   54,104,587 
                 
    GROSS PROFIT  9,227,830   9,050,498   39,253,253   34,797,461 
                 
    OPERATING EXPENSES:            
     Selling and fulfillment  5,068,847   8,133,299   28,095,176   32,427,972 
     General and administrative  2,902,127   3,913,672   12,120,969   12,792,998 
     Impairment loss - goodwill  -   -   -   3,060,034 
      Total operating expenses  7,970,974   12,046,971   40,216,145   48,281,004 
                 
    INCOME (LOSS) FROM OPERATIONS  1,256,856   (2,996,473)  (962,892)  (13,483,543)
                 
    OTHER INCOME (EXPENSE)            
     Interest expenses  (196,249)  (265,497)  (788,425)  (1,066,280)
     Loss on equity method investment  (2,890)  (1,376)  (5,508)  (10,001)
     Other non-operating income  (67,991)  (306,874)  (35,988)  (107,749)
      Total other expenses, net  (267,130)  (573,747)  (829,921)  (1,184,030)
                 
    INCOME (LOSS) BEFORE INCOME TAXES  989,726   (3,570,220)  (1,792,813)  (14,667,573)
                 
    PROVISION FOR INCOME TAX (BENEFIT) EXPENSE  336,309   (605,374)  (251,365)  (2,690,500)
    NET INCOME (LOSS)  653,417   (2,964,846)  (1,541,448)  (11,977,073)
                 
     Non-controlling interest  (3,685)  (2,805)  (13,289)  (11,683)
                 
    NET INCOME (LOSS) ATTRIBUTABLE TO IPOWER INC. $657,102  $(2,962,041) $(1,528,159) $(11,965,390)
                 
    OTHER COMPREHENSIVE LOSS            
     Foreign currency translation adjustments  (56,432)  (21,090)  (148,272)  (67,812)
                 
    COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO IPOWER INC. $600,670  $(2,983,131) $(1,676,431) $(12,033,202)
                 
    WEIGHTED AVERAGE NUMBER OF COMMON STOCK            
     Basic  29,943,439   29,747,497   29,878,196   29,713,354 
                 
    EARNINGS (LOSSES) PER SHARE            
     Basic $0.02  $(0.10) $(0.05) $(0.40)
                 


    iPower Inc. and Subsidiaries
    Reconciliation of GAAP to Non-GAAP Financial Measures
     
    (Unaudited)
                 
      For the Three Months Ended June 30, For the Years Ended June 30,
      2024  2023  2024  2023 
               
    GAAP NET INCOME (LOSS) ATTRIBUTABLE TO IPOWER INC. $657,102  $(2,962,041) $(1,528,159) $(11,965,390)
    Legal fees for arbitration  292,570   991,282   1,531,907   1,673,694 
    Impairment loss - goodwill  0   0   0   3,060,034 
    Adjustments to tax provision  (99,366)  (168,084)  (214,784)  (307,009)
    NON-GAAP NET INCOME (LOSS) ATTRIBUTABLE TO IPOWER INC. $850,306  $(2,138,843) $(211,036) $(7,538,671)
                 
                 
    GAAP EARNINGS (LOSSES) PER SHARE *            
    Basic $0.02  $(0.10) $(0.05) $(0.40)
    Impact of Non-GAAP adjustments  0.01   0.03   0.04   0.15 
    NON-GAAP EARNINGS (LOSSES) PER SHARE * $0.03  $(0.07) $(0.01) $(0.25)
                 
                 
    WEIGHTED AVERAGE NUMBER OF COMMON STOCK*            
     Basic - GAAP and NON-GAAP  29,943,439   29,747,497   29,878,196   29,713,354 
                 

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