BusinessWire

Boxlight Reports Second Quarter 2020 Results

Revenues of $7.8 Million

Gross Profit of 34%

Adjusted EBITDA Improvement of 69% to Loss of $0.3 Million

LAWRENCEVILLE, Ga.--(BUSINESS WIRE)--Boxlight Corporation (Nasdaq: BOXL) (“Boxlight”), a leading provider of interactive technology solutions for the global education market, today announced the Company's financial results for the first quarter ended June 30, 2020.

Key Financial Highlights for Q2 2020

  • Revenues decreased by 28% to $7.8 million
  • Customer orders decreased by 55% to $6.4 million
  • Gross profit increased by 670 basis points to 34%
  • Operating expenses decreased by 17% to $3.5 million
  • Operating loss decreased by 36% to $0.8 million
  • Net loss was even at $1.4 million
  • EPS loss decreased by 40% to $(0.08)
  • Adjusted EBITDA loss decreased by 69% to $0.3 million
  • Adjusted EPS decreased by 81% to loss of $0.01
  • Ended quarter with $2.5 million in backlog orders
  • Working capital improved by 175% to $3.8 million
  • Stockholders’ equity improved by 1,757% to $10.7 million

Key Business Highlights for Q2 2020

  • Entered into a partnership with JB&A distribution
  • Acquired Robo3D and MyStemKits
  • Entered into a supply agreement and strategic partnership with CEC Finance and Logistics
  • Entered into a distribution agreement with CT International
  • Expanded partnership with Clayton County Public Schools
  • Closed $11.5 million secondary offering
  • Released MimioConnect software platform for virtual and blended learning

Management Commentary

“We made significant progress as a company during the second quarter, including closing an $11.5 million secondary offering, launching our MimioConnect software platform for virtual and blended learning environments, expanding our sales channel, and acquiring Robo3D and MyStemKits, a complete 3D printing solution for education,” commented Michael Pope, Chairman and Chief Executive Officer. “Additionally, subsequent to quarter end, we entered into a strategic partnership with Samsung Electronics America, and we raised another $34.5 million, positioning the company with a strong balance sheet, equipped for future acquisition and joint venture opportunities.

Although COVID-19 has created significant disruption to the education market globally, we are well positioned as a company to provide the solutions educators need to create engaging and collaborative experiences in any format including in-class, virtual and hybrid environments.

We are committed to driving sustained shareholder value by delivering strong revenue growth and improved profitability both organically and through strategic partnerships and acquisitions.”

Financial Results for the Three Months Ended June 30, 2020

Revenue for the three months ended June 30, 2020 was $7.8 million, a decrease of $3.0 million or 28%, compared to $10.8 million for the three months ended June 30, 2019. Revenue loss reflects decreased sales volume primarily related to school closures as a result of COVID-19.

Gross profit for the three months ended June 30, 2020 was $2.7 million, a decrease of $0.3 million, compared to $3.0 million for the three months ended June 30, 2019. The resulting gross margin was 34.4% for the three months ended June 30, 2020, compared to 27.7% for the three months ended June 30, 2019.

General and Administrative expenses for the three months ended June 30, 2020 was $3.2 million, a decrease of $0.7 million or 18%, compared to $3.9 million for the three months ended June 30, 2019. The decrease was primarily driven by reductions in tradeshow expense and contract services.

Research and development expenses for the three months ended June 30, 2020 was $0.3 million, a decrease of 12%, compared to $0.3 million for the three months ended June 30, 2019. The decrease was primarily driven by a decrease in contract services and salaries.

Operating loss for the three months ended June 30, 2020 was $0.8 million, a decrease of $0.4 million, or 36%, compared to $1.2 million for the three months ended June 30, 2019.

Other expense for the three months ended June 30, 2020 was expense of $0.6 million, as compared to an expense of $0.2 million for the three months ended June 30, 2019. The increase in other expense is related to the change in fair value of derivative liability of $0.3 million and increased interest expense of $0.1 million.

Net loss for the three months ended June 30, 2020 was $1.4 million remaining flat compared to $1.4 million for the three months ended June 30, 2019. The resulting EPS loss for the three months ended June 30, 2020 was $(0.08) per diluted share, compared to $(0.13) per diluted share for the three months ended June 30, 2019.

Adjusted EBITDA loss for the three months ended June 30, 2020 was $0.3 million, a decrease of $0.5 million or 69% compared to $0.8 million for the three months ended June 30, 2019.

At June 30, 2020, Boxlight had $6.1 million of cash, $28.1 million of total assets, $7.1 debt, and 31.9 million shares issued and outstanding.

Financial Results for the Six Months Ended June 30, 2020

Revenue for the six months ended June 30, 2020 was $13.6 million, a decrease of $2.2 million or 14%, compared to $15.8 million for the six months ended June 30, 2019.

Gross profit for the six months ended June 30, 2020 was $4.3 million, a decrease of $0.4 million, compared to $4.7 million for the six months ended June 30, 2019. The resulting gross margin was 31.6% for the six months ended June 30, 2020, compared to 29.5% for the six months ended June 30, 2019.

General and administrative expenses for the six months ended June 30, 2020 was $7.1 million, a decrease of $0.6 million or 7%, compared to $7.7 million for the six months ended June 30, 2019. The decrease was primarily related to reductions in tradeshows and contract services offset by an increase in commissions.

Research and development expenses for the six months ended June 30, 2020 was $0.6 million, an increase of 7%, compared to $0.6 million for the six months ended June 30, 2019. The increase was primarily related to an increase in contract services offset by a decrease in salaries.

Operating loss for the six months ended June 30, 2020 was $3.5 million, a decrease of $0.1 million, or 3%, compared to $3.6 million for the six months ended June 30, 2019.

Other income (expense) for the six months ended June 30, 2020 was income of $0.1 million, as compared to an expense of $2.5 million for the six months ended June 30, 2019. The increase in other income is related to a gain on settlement of accounts payable $1.7 million, change in fair value of derivative liability $1.8 million offset by a loss on settlement of debt of $0.6 million and increased interest expense of $0.3 million.

Net loss for the six months ended June 30, 2020 was $3.4 million, a decrease of $2.6 million or 44%, compared to $6.0 million for the six months ended June 30, 2019. The resulting EPS loss for the six months ended June 30, 2020 was ($0.22) per diluted share, compared to ($0.58) per diluted share for the six months ended June 30, 2019.

Adjusted EBITDA loss for the six months ended June 30, 2020 was $1.3 million, a decrease of $1.3 million compared to $2.6 million for the six months ended June 30, 2019.

Adjusted EPS for the six months ended June 30, 2020 was ($0.09) per diluted share, compared to ($0.25) per diluted share for the six months ended June 30, 2019.

2nd Quarter 2020 Financial Results Conference Call

Management will host a conference call to discuss the second quarter 2020 financial results on Friday, August 14, 2020 at 9:30 a.m. Eastern Time. The conference call details are as follows:

Date:

 

Friday, August 14, 2020

Time:

 

9:30 a.m. Eastern Time / 6:30 a.m. Pacific Time

Dial-in:

 

1-844-602-0380 (Domestic)

1-862-298-0970 (International)

 

Webcast:

 

https://www.webcaster4.com/Webcast/Page/2213/36623

For those unable to participate during the live broadcast, a replay of the call will also be available from 7:30 p.m. Eastern Time on August 14, 2020 through 11:59 p.m. Eastern Time on August 28, 2020 by dialing 1-877-481-4010 (domestic) and 1-919-882-2331 (international) and referencing the replay pin number: 36623.

Use of Non-GAAP Financial Measures

To supplement Boxlight’s financial statements presented on a GAAP basis, Boxlight provides EBITDA and Adjusted EBITDA as supplemental measures of its performance.

To provide investors with additional insight and allow for a more comprehensive understanding of the information used by management in its financial and decision-making surrounding pro forma operations, we supplement our consolidated financial statements presented on a basis consistent with U.S. generally accepted accounting principles, or GAAP, with EBITDA and Adjusted EBITDA, non-GAAP financial measures of earnings. EBITDA represents net income before income tax expense (benefit), interest expense, depreciation and amortization. Adjusted EBITDA represents EBITDA plus stock-based compensation and change in fair value of derivative liabilities. Our management uses EBITDA and Adjusted EBITDA as financial measures to evaluate the profitability and efficiency of our business model. We use these non-GAAP financial measures to access the strength of the underlying operations of our business. These adjustments, and the non-GAAP financial measures that are derived from them, provide supplemental information to analyze our operations between periods and over time. We find this especially useful when reviewing pro forma results of operations, which include large non-cash amortizations of intangible assets from acquisitions and stock-based compensation. Investors should consider our non-GAAP financial measures in addition to, and not as a substitute for, financial measures prepared in accordance with GAAP.

About Boxlight Corporation

Boxlight Corporation (Nasdaq: BOXL) (“Boxlight”) is a leading provider of technology solutions for the global education market. The company aims to improve learning and engagement in classrooms and to help educators enhance student outcomes, by developing the products they need. The company develops, sells, and services its integrated, interactive solution suite including software, classroom technologies, professional development and support services. For more information about the Boxlight story, visit http://www.boxlight.com.

Forward Looking Statements

This press release may contain information about Boxlight's view of its future expectations, plans and prospects that constitute forward-looking statements. Actual results may differ materially from historical results or those indicated by these forward-looking statements as a result of a variety of factors including, but not limited to, risks and uncertainties associated with its ability to maintain and grow its business, variability of operating results, its development and introduction of new products and services, marketing and other business development initiatives, competition in the industry, etc. Boxlight encourages you to review other factors that may affect its future results in Boxlight's filings with the Securities and Exchange Commission.

 

Boxlight Corporation

Consolidated Condensed Balance Sheets

 

 

 

June 30, 2020

 

 

December 31, 2019

 

ASSETS

 

 

 

 

 

 

 

Current asset:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

6,133,053

 

 

$

1,172,994

 

Accounts receivable – trade, net of allowances

 

 

5,356,940

 

 

 

3,665,057

 

Inventories, net of reserves

 

 

2,868,192

 

 

 

3,318,857

 

Prepaid expenses and other current assets

 

 

3,172,768

 

 

 

1,765,741

 

Total current assets

 

 

17,530,953

 

 

 

9,922,649

 

 

 

 

 

 

 

 

 

 

Property and equipment, net of accumulated depreciation

 

 

198,653

 

 

 

207,397

 

Intangible assets, net of accumulated amortization

 

 

5,574,666

 

 

 

5,559,097

 

Goodwill

 

 

4,723,549

 

 

 

4,723,549

 

Other assets

 

 

62,327

 

 

 

56,193

 

Total assets

 

$

28,090,148

 

 

$

20,468,885

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable and accrued expenses

 

$

3,802,221

 

 

$

4,721,417

 

Accounts payable and accrued expenses – related parties

 

 

2,221,350

 

 

 

5,031,367

 

Warranty reserve

 

 

2,713

 

 

 

12,775

 

Current portion of debt – third parties

 

 

5,388,350

 

 

 

4,536,227

 

Current portions of debt – related parties

 

 

383,726

 

 

 

368,383

 

Earn-out payable – related party

 

 

122,372

 

 

 

387,118

 

Deferred revenues – short-term

 

 

1,577,992

 

 

 

1,972,565

 

Derivative liabilities

 

 

192,304

 

 

 

146,604

 

Other short-term liabilities

 

 

30,560

 

 

 

31,417

 

Total current liabilities

 

 

13,721,588

 

 

 

17,207,873

 

 

 

 

 

 

 

 

 

 

Deferred revenues – long-term

 

 

2,350,154

 

 

 

2,582,602

 

Long-term debt – third parties

 

 

1,277,980

 

 

 

1,201,139

 

Long-term debt – related parties

 

 

-

 

 

 

108,228

 

Other long-term liabilities

 

 

9,006

 

 

 

16,696

 

Total liabilities

 

 

17,358,728

 

 

 

21,116,538

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ deficit:

 

 

 

 

 

 

 

 

Preferred stock, $0.0001 par value, 50,000,000 shares authorized; 167,972 shares issued and outstanding

 

 

17

 

 

 

17

 

Common stock, $0.0001 par value, 200,000,000 shares authorized; 31,857,327 and 11,698,697 Class A shares issued and outstanding, respectively

 

 

3,186

 

 

 

1,170

 

Additional paid-in capital

 

 

45,596,815

 

 

 

30,735,815

 

Subscriptions receivable

 

 

(200

)

 

 

(200

)

Accumulated deficit

 

 

(34,722,050

)

 

 

(31,346,431

)

Accumulated other comprehensive loss

 

 

(146,348

)

 

 

(38,024

)

Total stockholders’ equity (deficit)

 

 

10,731,420

 

 

 

(647,653

)

 

 

 

 

 

 

 

 

 

Total liabilities and stockholders’ equity (deficit)

 

$

28,090,148

 

 

$

20,468,885

 

 

Boxlight Corporation

Consolidated Condensed Statements of Operations and Comprehensive Loss

 

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

June 30,

 

 

June 30,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

 

 

 

 

(Note 1)

 

 

 

 

 

(Note 1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues, net

 

$

7,827,718

 

 

$

10,801,523

 

 

$

13,550,767

 

 

$

15,794,923

 

Cost of revenues

 

 

5,137,168

 

 

 

7,812,079

 

 

 

9,269,157

 

 

 

11,133,412

 

Gross profit

 

 

2,690,550

 

 

 

2,989,444

 

 

 

4,281,610

 

 

 

4,661,511

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative expenses

 

 

3,199,486

 

 

 

3,896,374

 

 

 

7,137,215

 

 

 

7,662,442

 

Research and development

 

 

285,210

 

 

 

324,582

 

 

 

601,966

 

 

 

560,578

 

Total operating expense

 

 

3,484,695

 

 

 

4,220,956

 

 

 

7,739,181

 

 

 

8,223,020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss from operations

 

 

(794,146

)

 

 

(1,231,512

)

 

 

(3,457,571

)

 

 

(3,561,509

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

 

(628,216

)

 

 

(479,022

)

 

 

(1,087,536

)

 

 

(759,625

)

Other income, net

 

 

17,655

 

 

 

23,670

 

 

 

75,605

 

 

 

44,879

 

Changes in fair value of derivative liabilities

 

 

(74,363

)

 

 

263,260

 

 

(45,700

)

 

 

(1,899,235

)

Gain from settlements of liabilities

 

 

53,074

 

 

 

-

 

 

 

1,139,583

 

 

 

146,434

 

Total other expense

 

 

(631,850

)

 

 

(192,092

)

 

 

81,952

 

 

 

(2,467,547

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(1,425,996

)

 

$

(1,423,604

)

 

$

(3,375,619

)

 

$

(6,029,056

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive loss:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

 

(1,425,996

)

 

 

(1,423,604

)

 

$

(3,375,619

)

 

$

(6,029,056

)

Other comprehensive loss:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation gain (loss)

 

 

(4,897

)

 

 

22,962

 

 

 

(108,324

)

 

 

(15,186

)

Total comprehensive loss

 

$

(1,430,893

)

 

$

(1,400,642

)

 

$

(3,482,943

)

 

$

(6,044,242

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per common share – basic and diluted

 

$

(0.08

)

 

$

(0.13

)

 

$

(0.22

)

 

$

(0.58

)

Weighted average number of common shares outstanding – basic and diluted

 

 

17,637,458

 

 

 

10,590,451

 

 

 

15,065,644

 

 

 

10,424,054

 

 

Boxlight Corporation

Reconciliation of net loss for the three months ended

 

 

 

Three months ended

 

 

 

June 30

 

(in thousands)

 

2020

 

 

2019

 

Net loss

 

$

(1,426

)

 

$

(1,424

)

Depreciation and amortization

 

 

221

 

 

 

225

 

Interest expense

 

 

628

 

 

 

479

 

EBITDA

 

$

(577

)

 

$

(720

)

Stock compensation expense

 

 

249

 

 

 

160

 

Change in fair value of derivative liabilities

 

 

74

 

 

 

(263

)

Adjusted EBITDA

 

$

(254

)

 

$

(823

)

 

Boxlight Corporation

Reconciliation of net loss for the three months ended

 

 

 

Six months ended

 

 

June 30

 

(in thousands)

 

2020

 

 

2019

 

Net loss

 

$

(3,376

)

 

$

(6,029

)

Depreciation and amortization

 

 

440

 

 

 

467

 

Interest expense

 

 

1,088

 

 

 

760

 

EBITDA

 

$

(1,848

)

 

$

(4,802

)

Stock compensation expense

 

 

520

 

 

 

321

 

Change in fair value of derivative liabilities

 

 

46

 

 

 

1,899

 

Adjusted EBITDA

 

$

(1,282

)

 

$

(2,582

)

 


Contacts

Media
Sunshine Nance
+1 360-464-2119 x254
sunshine.nance@boxlight.com

Investor Relations
Michael Pope
+1 360-464-4478
michael.pope@boxlight.com