Profire Energy, Inc. (NASDAQ: PFIE), a technology company (the
"Company") that provides solutions which enhance the efficiency,
safety, and reliability of industrial combustion appliances, today
reported financial results for its first quarter ending March 31,
2024. A conference call will be held on Thursday, May 9, 2024 at
8:30 a.m. ET to discuss the results.
First Quarter Summary (comparisons to
prior-year quarter)
- Revenue of
$13.6 million, compared to $14.7 million
- Gross profit
of $6.8 million, compared to $7.8 million
- Gross margin
of 49.5%, compared to 53.3%
- Net income of
$1.4 million, or $0.03 per diluted share, versus $2.6 million and
$0.05
- Generated
EBITDA of $2.0 million, versus $3.6 million
- Cash and
investments of $16.2 million with no debt
"Our first quarter results reflect the continued underlying
strength of our legacy business and expansion of our
diversification efforts, despite lapping the third best quarterly
revenue in company history and a significant decline in natural gas
prices during the quarter," said Ryan Oviatt, co-CEO and Chief
Financial Officer of Profire Energy. "Our overall balance sheet
remains strong, with cash in the bank, zero debt, and sufficient
inventory to ensure on-time product deliveries to our
customers."
First Quarter 2024 Financial Results
Total revenues for the period equaled $13.6 million, compared to
$14.5 million in the fourth quarter of 2023 and $14.7 million in
the prior-year quarter. The sequential and year-over-year increase
was partially driven by the timing of certain that orders moved
into the second quarter of this year due to changes in customer
timing and preparation.
Gross profit was $6.8 million, compared to $7.8 million in both
the fourth quarter and same quarter of 2023. Gross margin was 49.5%
of revenues, compared to 53.9% of revenues in the prior quarter and
53.3% of revenues in the prior-year quarter. The sequential and
year-over-year decrease is related to product mix, the typical
fluctuations in inventory and warranty reserves and inflation.
Total operating expenses were $5.0 million, compared to $5.0
million in the final quarter of 2023 and $4.5 million in the
year-ago quarter. The increase year-over-year is primarily due to
ongoing inflation pressure on our business as well as increased
headcount to support strategic growth and increased business
activity.
Compared with the same quarter last year, operating expenses for
G&A increased 12%, R&D decreased 11% and depreciation
increased by 5%.
Net income was $1.4 million, or $0.03 per diluted share,
compared to net income of $3.3 million or $0.07 per diluted share
in the fourth quarter of 2023 and $2.6 million or $0.05 per diluted
share in the same quarter last year.
"The underlying fundamentals of our business remain strong. We
recorded our best two sequential quarters in Company history of
total value of sales orders received thanks to the strength of our
brand and revenue diversification efforts. We have multiple
favorable industry tailwinds including forecasts related to LNG and
renewable natural gas expansion coupled with the growing demand for
global electrification." said Cameron Tidball, co-CEO of Profire
Energy. "Our diversification strategy continues to attract interest
from existing and new customers. We remain very optimistic about
the outlook for Profire and our ability to deliver long-term value
to our shareholders."
Conference Call
Profire Energy Executives will host the call, followed by a
question-and-answer period.
Date: Thursday, May 9, 2024Time: 8:30 a.m. ET (6:30 a.m.
MT)Toll-free dial-in number: 1-855-327-6837International dial-in
number: 1-631-891-4304
The conference call will be webcast live and available for
replay via this link:
https://viavid.webcasts.com/starthere.jsp?ei=1653742&tp_key=c7e5f7d333 The
webcast replay will be available for one year.
Please call the conference telephone number five minutes prior
to the start time. An operator will register your name and
organization. If you have any difficulty connecting the conference
call, please contact Athena Kefalas at 1-801-796-8969.
A replay of the call will be available via the dial-in numbers
below after 1:00 p.m. ET on the same day through May 23, 2024.
Toll-free replay number: 1-844-512-2921International replay
number: 1-412-317-6671Replay Pin Number: 10022992
About Profire Energy, Inc.Profire Energy is a
technology company providing solutions that enhance the efficiency,
safety, and reliability of industrial combustion appliances while
mitigating potential environmental impacts related to the operation
of these devices. It is primarily focused in the upstream,
midstream, and downstream transmission segments of the oil and gas
industry. However, in recent years, we have completed many
installations of our burner-management solutions in other
industries that we believe will be applicable as we expand our
addressable market over time. Profire specializes in the
engineering and design of burner and combustion management systems
and solutions used on a variety of natural and forced draft
applications. Its products and services are sold primarily
throughout North America. It has an experienced team of sales and
service professionals that are strategically positioned across the
United States and Canada. Profire has offices in Lindon, Utah;
Victoria, Texas; Midland-Odessa, Texas; Homer, Pennsylvania;
Greeley, Colorado; Millersburg, Ohio; and Acheson, Alberta, Canada.
For additional information, visit www.profireenergy.com.
Cautionary Note Regarding Forward-Looking
Statements. Statements made in this release that are not
historical are forward-looking statements. This release contains
forward-looking statements, including, but not limited to
statements regarding the Company’s expected growth, delivery of
Company product, and the Company’s expected revenues from
diversification opportunities. Forward-looking statements are not
guarantees of future results or performance and involve risks,
assumptions and uncertainties that could cause actual events or
results to differ materially from the events or results described
in, or anticipated by, the forward-looking statements. Factors that
could materially affect such forward-looking statements include
certain economic, business, public market and regulatory risks and
factors identified in the company's periodic reports filed with the
Securities and Exchange Commission. All forward-looking statements
are made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. All forward-looking
statements are made only as of the date of this release and the
Company assumes no obligation to update forward-looking statements
to reflect subsequent events or circumstances, except as required
by law. Readers should not place undue reliance on these
forward-looking statements.
Contact:Profire Energy,
Inc.Ryan Oviatt, Co-CEO & CFO(801) 796-5127
Three Part AdvisorsSteven Hooser, PartnerJohn
Beisler, Managing Director214-872-2710
About Non-GAAP Financial Measures
To supplement our consolidated financial statements, which
statements are prepared and presented in accordance with GAAP, we
use the following non-GAAP financial measure of earnings before
interest, taxes, depreciation and amortization (“EBITDA”). The
presentation of this financial information is not intended to be
considered in isolation or as a substitute for, or superior to, the
financial information prepared and presented in accordance with
GAAP.
We use this non-GAAP financial measure for financial and
operational decision making and as a means to evaluate
period-to-period comparisons. Our management believes that this
non-GAAP financial measure provides meaningful supplemental
information regarding our performance. We believe that both
management and investors benefit from referring to this non-GAAP
financial measure in assessing our performance and when planning,
forecasting, and analyzing future periods. We believe this non-GAAP
financial measure is useful to investors both because it allows for
greater transparency with respect to key metrics used by management
in its financial and operational decision making.
The Following is a tabular presentation of EBITDA, including a
reconciliation to net income which the Company believes to be the
most directly comparable US GAAP financial measure.
|
3/31/2024 |
3/31/2023 |
EBITDA
Calculation: |
3 months |
3 months |
Net Income |
$1,434,375 |
|
$2,589,621 |
|
add back net income tax expense |
$393,148 |
|
$816,815 |
|
add back net interest expense |
$(68,952) |
|
$(57,114) |
|
add back depreciation and amortization |
$267,654 |
|
$262,039 |
|
EBITDA calculated |
$2,026,225 |
|
$3,611,361 |
|
PROFIRE ENERGY, INC. AND SUBSIDIARIES |
Condensed Consolidated Balance Sheets |
|
|
As of |
|
|
March 31, 2024 |
|
December 31, 2023 |
ASSETS |
|
(Unaudited) |
|
|
CURRENT ASSETS |
|
|
|
|
Cash and cash equivalents |
|
$ |
7,196,424 |
|
|
$ |
10,767,519 |
|
Short-term investments |
|
|
2,750,324 |
|
|
|
2,799,539 |
|
Accounts receivable, net |
|
|
14,226,321 |
|
|
|
14,013,740 |
|
Inventories, net (note 3) |
|
|
15,747,817 |
|
|
|
14,059,656 |
|
Prepaid expenses and other current assets (note 4) |
|
|
3,357,009 |
|
|
|
2,832,262 |
|
Total Current Assets |
|
|
43,277,895 |
|
|
|
44,472,716 |
|
LONG-TERM ASSETS |
|
|
|
|
Net deferred tax asset |
|
|
497,263 |
|
|
|
496,785 |
|
Long-term investments |
|
|
6,286,599 |
|
|
|
6,425,582 |
|
Lease right-of-use asset (note 6) |
|
|
395,267 |
|
|
|
432,907 |
|
Property and equipment, net |
|
|
11,233,795 |
|
|
|
10,782,372 |
|
Intangible assets, net |
|
|
1,064,724 |
|
|
|
1,104,102 |
|
Goodwill |
|
|
2,579,381 |
|
|
|
2,579,381 |
|
Total Long-Term Assets |
|
|
22,057,029 |
|
|
|
21,821,129 |
|
TOTAL ASSETS |
|
$ |
65,334,924 |
|
|
$ |
66,293,845 |
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS'
EQUITY |
|
|
|
|
CURRENT LIABILITIES |
|
|
|
|
Accounts payable |
|
$ |
2,985,177 |
|
|
$ |
2,699,556 |
|
Accrued liabilities (note 5) |
|
|
2,733,161 |
|
|
|
4,541,820 |
|
Current lease liability (note 6) |
|
|
121,386 |
|
|
|
130,184 |
|
Income taxes payable |
|
|
916,469 |
|
|
|
1,723,910 |
|
Total Current Liabilities |
|
|
6,756,193 |
|
|
|
9,095,470 |
|
LONG-TERM LIABILITIES |
|
|
|
|
Net deferred income tax liability |
|
|
44,876 |
|
|
|
52,621 |
|
Long-term lease liability (note 6) |
|
|
280,371 |
|
|
|
307,528 |
|
TOTAL LIABILITIES |
|
|
7,081,440 |
|
|
|
9,455,619 |
|
|
|
|
|
|
STOCKHOLDERS' EQUITY (note
7) |
|
|
|
|
Preferred stock: $0.001 par value, 10,000,000 shares authorized: no
shares issued or outstanding |
|
|
— |
|
|
|
— |
|
Common stock: $0.001 par value, 100,000,000 shares authorized:
53,337,589 issued and 47,094,226 outstanding at March 31, 2024, and
53,047,231 issued and 46,803,868 outstanding at December 31,
2023 |
|
|
53,340 |
|
|
|
53,048 |
|
Treasury stock, at cost |
|
|
(9,324,272 |
) |
|
|
(9,324,272 |
) |
Additional paid-in capital |
|
|
32,966,075 |
|
|
|
32,751,749 |
|
Accumulated other comprehensive loss |
|
|
(3,078,437 |
) |
|
|
(2,844,702 |
) |
Retained earnings |
|
|
37,636,778 |
|
|
|
36,202,403 |
|
TOTAL STOCKHOLDERS' EQUITY |
|
|
58,253,484 |
|
|
|
56,838,226 |
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
|
$ |
65,334,924 |
|
|
$ |
66,293,845 |
|
|
These financial statements should be read in
conjunction with the Form 10-Q and accompanying footnotes.
PROFIRE ENERGY, INC. AND
SUBSIDIARIES |
Condensed Consolidated Statements of Income and Comprehensive
Income |
(Unaudited) |
|
|
For the Three Months Ended March 31, |
|
|
2024 |
|
2023 |
|
|
|
|
(See Note 1) |
REVENUES (note 8) |
|
|
|
|
Sales of products, net |
|
$ |
12,691,804 |
|
|
$ |
13,759,679 |
|
Sales of services, net |
|
|
949,336 |
|
|
|
924,949 |
|
Total Revenues |
|
|
13,641,140 |
|
|
|
14,684,628 |
|
|
|
|
|
|
COST OF SALES |
|
|
|
|
Cost of sales - products |
|
|
6,095,004 |
|
|
|
6,105,506 |
|
Cost of sales - services |
|
|
789,364 |
|
|
|
746,014 |
|
Total Cost of Sales |
|
|
6,884,368 |
|
|
|
6,851,520 |
|
|
|
|
|
|
GROSS PROFIT |
|
|
6,756,772 |
|
|
|
7,833,108 |
|
|
|
|
|
|
OPERATING EXPENSES |
|
|
|
|
General and administrative |
|
|
4,604,766 |
|
|
|
4,110,032 |
|
Research and development |
|
|
265,058 |
|
|
|
274,389 |
|
Depreciation and amortization |
|
|
149,859 |
|
|
|
142,887 |
|
Total Operating Expenses |
|
|
5,019,683 |
|
|
|
4,527,308 |
|
|
|
|
|
|
INCOME FROM OPERATIONS |
|
|
1,737,089 |
|
|
|
3,305,800 |
|
|
|
|
|
|
OTHER INCOME (EXPENSE) |
|
|
|
|
Gain on sale of assets |
|
|
44,821 |
|
|
|
53,075 |
|
Other expense |
|
|
(23,339 |
) |
|
|
(9,553 |
) |
Interest income |
|
|
71,897 |
|
|
|
58,047 |
|
Interest expense |
|
|
(2,945 |
) |
|
|
(933 |
) |
Total Other Income |
|
|
90,434 |
|
|
|
100,636 |
|
|
|
|
|
|
INCOME BEFORE INCOME
TAXES |
|
|
1,827,523 |
|
|
|
3,406,436 |
|
|
|
|
|
|
INCOME TAX EXPENSE |
|
|
(393,148 |
) |
|
|
(816,815 |
) |
|
|
|
|
|
NET INCOME |
|
$ |
1,434,375 |
|
|
$ |
2,589,621 |
|
|
|
|
|
|
OTHER COMPREHENSIVE INCOME
(LOSS) |
|
|
|
|
Foreign currency translation
loss |
|
$ |
(244,801 |
) |
|
$ |
(5,524 |
) |
Unrealized gains on
investments |
|
|
11,066 |
|
|
|
76,287 |
|
Total Other Comprehensive Income (Loss) |
|
|
(233,735 |
) |
|
|
70,763 |
|
|
|
|
|
|
COMPREHENSIVE INCOME |
|
$ |
1,200,640 |
|
|
$ |
2,660,384 |
|
|
|
|
|
|
BASIC EARNINGS PER SHARE |
|
$ |
0.03 |
|
|
$ |
0.05 |
|
FULLY DILUTED EARNINGS PER
SHARE |
|
$ |
0.03 |
|
|
$ |
0.05 |
|
|
|
|
|
|
BASIC WEIGHTED AVG NUMBER OF
SHARES OUTSTANDING |
|
|
46,884,875 |
|
|
|
47,174,518 |
|
FULLY DILUTED WEIGHTED AVG
NUMBER OF SHARES OUTSTANDING |
|
|
48,482,704 |
|
|
|
48,612,833 |
|
|
These financial statements should be read in
conjunction with the Form 10-Q and accompanying footnotes.
PROFIRE ENERGY, INC. AND SUBSIDIARIES |
Condensed Consolidated Statements of Cash Flows |
(Unaudited) |
|
For the Three Months Ended March 31, |
|
2024 |
|
2023 |
OPERATING ACTIVITIES |
|
|
|
Net income |
$ |
1,434,375 |
|
|
$ |
2,589,621 |
|
Adjustments to reconcile net
income to net cash provided by operating activities: |
|
|
|
Depreciation and amortization expense |
|
267,654 |
|
|
|
262,039 |
|
Gain on sale of property and equipment |
|
(44,821 |
) |
|
|
(53,075 |
) |
Bad debt expense |
|
61,684 |
|
|
|
41,792 |
|
Stock awards issued for services |
|
197,443 |
|
|
|
223,047 |
|
Changes in operating assets
and liabilities: |
|
|
|
Accounts receivable |
|
(23,969 |
) |
|
|
(1,108,889 |
) |
Income taxes receivable/payable |
|
(804,057 |
) |
|
|
629,371 |
|
Inventories |
|
(1,741,768 |
) |
|
|
(292,119 |
) |
Prepaid expenses and other current assets |
|
(564,253 |
) |
|
|
(335,832 |
) |
Deferred tax asset/liability |
|
(7,112 |
) |
|
|
212,548 |
|
Accounts payable and accrued liabilities |
|
(1,467,314 |
) |
|
|
(1,646,723 |
) |
Net Cash Provided by (Used in) Operating
Activities |
|
(2,692,138 |
) |
|
|
521,780 |
|
|
|
|
|
INVESTING ACTIVITIES |
|
|
|
Proceeds from sale of property and equipment |
|
46,097 |
|
|
|
97,886 |
|
Sale (purchase) of investments |
|
199,357 |
|
|
|
(390,548 |
) |
Purchase of property and equipment |
|
(776,721 |
) |
|
|
(153,755 |
) |
Net Cash Used in Investing Activities |
|
(531,267 |
) |
|
|
(446,417 |
) |
|
|
|
|
FINANCING ACTIVITIES |
|
|
|
Value of equity awards surrendered by employees for tax
liability |
|
(307,933 |
) |
|
|
(242,506 |
) |
Principal paid toward lease liability |
|
(10,875 |
) |
|
|
(6,947 |
) |
Net Cash Used in Financing Activities |
|
(318,808 |
) |
|
|
(249,453 |
) |
|
|
|
|
Effect of exchange rate
changes on cash |
|
(28,882 |
) |
|
|
8,868 |
|
|
|
|
|
NET DECREASE IN CASH |
|
(3,571,095 |
) |
|
|
(165,222 |
) |
CASH AT BEGINNING OF
PERIOD |
|
10,767,519 |
|
|
|
7,384,578 |
|
CASH AT END OF PERIOD |
$ |
7,196,424 |
|
|
$ |
7,219,356 |
|
|
|
|
|
SUPPLEMENTAL DISCLOSURES OF
CASH FLOW INFORMATION |
|
|
|
|
|
|
|
CASH PAID FOR: |
|
|
|
Interest |
$ |
2,945 |
|
|
$ |
933 |
|
Income taxes |
$ |
1,056,844 |
|
|
$ |
— |
|
NON-CASH FINANCING AND
INVESTING ACTIVITIES |
|
|
|
Common stock issued in settlement of accrued bonuses |
$ |
324,415 |
|
|
$ |
378,526 |
|
Common stock issued for stock options |
$ |
850 |
|
|
$ |
— |
|
|
These financial statements should be read in
conjunction with the Form 10-Q and accompanying footnotes.
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