Core Insights - CEA Industries Inc. reported a significant decline in revenue and increased net losses for both the fourth quarter and full year of 2024 compared to previous periods [1][3][9] Financial Performance - **Fourth Quarter 2024**: Revenue was $417,000, up from $391,000 in Q3 2024 and $251,000 in Q4 2023, indicating a year-over-year increase of approximately 66.2% [2][5] - **Gross Profit**: The gross loss for Q4 2024 was $175,000, an improvement from a gross loss of $286,000 in Q4 2023, reflecting a reduction in variable costs [2][7] - **Operating Expenses**: Operating expenses rose to $850,000 in Q4 2024 from $677,000 in Q3 2024, primarily due to acquisition-related expenses [2][8] - **Net Loss**: The net loss for Q4 2024 was $1,019,000, compared to a net loss of $988,000 in Q4 2023, with a loss per share of $(1.29) [2][9] - **Full Year 2024**: Total revenue for FY 2024 was $2,803,000, a significant decrease from $6,911,000 in FY 2023 [3][16] - **Gross Profit**: The full-year gross loss was $220,000, down from a gross profit of $542,000 in FY 2023 [3][16] - **Operating Expenses**: Operating expenses decreased to $2,952,000 in FY 2024 from $3,495,000 in FY 2023, reflecting a 16% reduction [3][16] - **Net Loss**: The net loss for FY 2024 was $3,146,000, compared to a net loss of $2,912,000 in FY 2023 [3][16] Strategic Developments - The company signed an agreement to acquire Fat Panda, a retailer and manufacturer of e-cigarettes and vape devices, which is expected to enhance operational efficiencies and long-term value creation [4] - The acquisition aligns with the company's strategic objectives and aims to leverage Fat Panda's market presence for expansion [4] Backlog and Bookings - **Net Bookings**: In Q4 2024, net bookings increased to $500,000 from $100,000 in the same period last year, attributed to a significant equipment order [6] - **Backlog**: The company's backlog at the end of Q4 2024 was $500,000, up from $400,000 in Q4 2023, indicating a positive trend in demand [6]

Part I [Item 1. Business](index=4&type=section&id=Item%201.%20Business) CEA Industries offers CEA tech for cannabis, diversifying into e-cigarettes, facing industry challenges and regulatory risks - CEA Industries focuses on environmental control and technology solutions for the Controlled Environment Agriculture (CEA) industry, primarily serving cannabis cultivators[26](index=26&type=chunk)[27](index=27&type=chunk)[162](index=162&type=chunk) - The company is acquiring Fat Panda Ltd., a Canadian e-cigarette, vape device, and e-liquid manufacturer and retailer, for **CAD$18,000,000** (approximately **US$12,600,000**), diversifying its business outside the CEA industry[29](index=29&type=chunk)[32](index=32&type=chunk)[540](index=540&type=chunk) - The CEA industry faces challenges including high energy costs, evolving waste regulations, inflationary pressures, labor shortages, and declining cannabis prices, leading to a decline in company activity and sales in 2024[28](index=28&type=chunk)[42](index=42&type=chunk)[169](index=169&type=chunk) [Overview](index=5&type=section&id=Overview) Surna Cultivation Technologies provides environmental control and tech solutions for the CEA industry, primarily serving cannabis cultivators - CEA Industries, through Surna Cultivation Technologies LLC, provides environmental control and other technologies and services to the Controlled Environment Agriculture (CEA) industry, aiming to optimize horticultural resources[26](index=26&type=chunk) - The company offers air handling equipment, air sanitation products, LED lighting, and benching/racking solutions, primarily to customers cultivating marijuana[162](index=162&type=chunk)[163](index=163&type=chunk)[16](index=16&type=chunk) [Recent Developments – Acquisition of Fat Panda](index=6&type=section&id=Recent%20Developments%20%E2%80%93%20Acquisition%20of%20Fat%20Panda) CEA Industries plans to acquire Fat Panda Ltd., a Canadian e-cigarette and vape product manufacturer and retailer, for CAD$18 million - CEA Industries has an agreement to acquire Fat Panda Ltd., a leading e-cigarette, vape device, and e-liquid manufacturer and retailer in central Canada, with 33 retail locations and an online platform[29](index=29&type=chunk)[30](index=30&type=chunk)[540](index=540&type=chunk) - The purchase price is **CAD$18,000,000** (approximately **US$12,600,000**), payable in cash, securities (**39,000 shares** of common stock valued at **CAD$700,000**), and seller loans (**CAD$2,060,000** in notes)[32](index=32&type=chunk)[542](index=542&type=chunk) - The acquisition is subject to conditions including audited financial statements, due diligence, government approvals, lease continuation, and securing financing for a portion of the cash purchase price, with completion anticipated in the first half of fiscal year 2025[33](index=33&type=chunk)[34](index=34&type=chunk)[543](index=543&type=chunk)[544](index=544&type=chunk) [Our Current CEA Services and Equipment Solutions](index=7&type=section&id=Our%20Current%20CEA%20Services%20and%20Equipment%20Solutions) The company provides comprehensive services and equipment for the entire lifecycle of indoor agriculture facilities - The company aims to provide comprehensive services and equipment for the complete lifecycle of indoor agriculture facilities, including design, engineering, infrastructure technologies, installation advisory, training, and ongoing maintenance[35](index=35&type=chunk)[36](index=36&type=chunk) [Our CEA Customers and Prospects](index=7&type=section&id=Our%20CEA%20Customers%20and%20Prospects) Customers are primarily new entrants to the CEA industry, including multi-facility operators, but not the largest publicly traded MSOs - Customers are primarily new entrants to the CEA industry, including multi-facility operators (MFOs), but the company currently does not have projects with the largest publicly traded Multi-State Operators (MSOs)[38](index=38&type=chunk) [Competition in the CEA Market](index=7&type=section&id=Competition%20in%20the%20CEA%20Market) The company competes with various engineering and HVACD firms, differentiating with crop-specific climate control systems, facing increasing market competition - The company competes with national and local MEP engineering firms, HVACD contractors, and traditional HVACD equipment suppliers, differentiating itself with crop-specific climate control systems and engineering services for CEA facilities[39](index=39&type=chunk) - Increased competition is observed as more competitors enter the CEA market, potentially impacting the company's ability to secure new projects and requiring acceptance of lower gross margins[39](index=39&type=chunk) [Intellectual Property](index=7&type=section&id=Intellectual%20Property) The company protects its intellectual property through patents, trademarks, licenses, trade secrets, and contractual restrictions - The company relies on a combination of patent and trademark rights, licenses, trade secrets, and contractual restrictions to protect its intellectual property, including registered trademarks for its Surna brand and SentryIQ platform[40](index=40&type=chunk) [Employees](index=8&type=section&id=Employees) The company currently has 6 full-time employees and utilizes consultants, with future hiring dependent on business growth - The company currently has **6 active full-time employees** and may utilize consultants and independent contractors, with future hiring dependent on business needs and growth[41](index=41&type=chunk) [US Government Regulation in Relation to Cannabis](index=8&type=section&id=US%20Government%20Regulation%20in%20Relation%20to%20Cannabis) The company operates in the federally illegal cannabis industry, facing evolving regulations and financial challenges due to federal prohibitions - The company provides services to the cannabis industry, which is federally illegal as a Schedule I controlled substance, despite state-level legalization for medical or recreational use[43](index=43&type=chunk)[44](index=44&type=chunk) - Evolving federal enforcement policies and ongoing legislative considerations (e.g., MORE Act, States Reform Act, SAFER Banking Act) could significantly impact the cannabis industry and, consequently, the company's business[45](index=45&type=chunk)[46](index=46&type=chunk)[47](index=47&type=chunk) - Federal laws prohibit most federally chartered banks from accepting funds from marijuana businesses, leading to reliance on state-chartered banks and credit unions, and creating financial challenges for the industry[49](index=49&type=chunk)[118](index=118&type=chunk) [Item 1A. Risk Factors](index=10&type=section&id=Item%201A.%20Risk%20Factors) Investing in CEA Industries' securities involves significant risks, including limited revenues, working capital deficits, fluctuating operating results, supply chain disruptions, intense competition, and regulatory challenges in the cannabis industry - The company has historically had limited revenues, operated with a working capital deficit, and experienced fluctuating operating results, requiring external financing for growth and continued operations[56](index=56&type=chunk)[57](index=57&type=chunk)[58](index=58&type=chunk) - Significant risks include the inability to convert contract backlog into revenue due to customer financing, permitting, and construction delays, as well as supply chain disruptions and inflationary pressures affecting costs and margins[56](index=56&type=chunk)[61](index=61&type=chunk)[62](index=62&type=chunk) - The company's reliance on the cannabis industry exposes it to federal illegality, anti-money laundering laws, civil asset forfeiture, and difficulties for customers in accessing banking services and deducting business expenses under Section 280E of the Code[56](index=56&type=chunk)[97](index=97&type=chunk)[105](index=105&type=chunk)[108](index=108&type=chunk)[118](index=118&type=chunk)[122](index=122&type=chunk) [Summary Of Risk Factors Relating to our Current CEA Operations](index=10&type=section&id=Summary%20Of%20Risk%20Factors%20Relating%20to%20our%20Current%20CEA%20Operations) Key risks for CEA operations include limited revenues, working capital deficits, fluctuating results, backlog conversion challenges, cannabis regulatory exposure, and internal control weaknesses - Key risks for CEA operations include limited revenues, working capital deficit, fluctuating operating results, challenges in converting contract backlog to revenue, exposure to the cannabis industry's regulatory environment, and material weaknesses in financial reporting controls[56](index=56&type=chunk) [Risks Relating to Our Current CEA Business](index=11&type=section&id=Risks%20Relating%20to%20Our%20Current%20CEA%20Business) The company's limited revenues necessitate additional financing, and inconsistent backlog conversion, along with internal control weaknesses, pose significant business risks - The company's limited revenues necessitate additional financing for growth and operations, which may not always be available, potentially leading to shareholder dilution or increased debt vulnerability[57](index=57&type=chunk)[58](index=58&type=chunk)[59](index=59&type=chunk) - Conversion of backlog into revenue is inconsistent and dependent on customer factors like funding, permits, and facility construction, with no guarantee of profitability even with increased customer base or project size[62](index=62&type=chunk) - Material weaknesses in internal controls over financial reporting, including insufficient accounting expertise, inadequate segregation of duties, and reliance on unverified spreadsheets, could adversely impact financial reporting accuracy and investor confidence[64](index=64&type=chunk)[65](index=65&type=chunk) [Risks Related to the Cannabis Industry](index=18&type=section&id=Risks%20Related%20to%20the%20Cannabis%20Industry) The cannabis industry's federal illegality in the U.S. poses significant risks, including enforcement actions, financial service access difficulties, and regulatory uncertainties - Cannabis remains illegal under U.S. federal law, posing a risk that strict enforcement could prevent the company from executing its business plan and lead to significant losses from its cannabis industry clients[97](index=97&type=chunk)[99](index=99&type=chunk)[103](index=103&type=chunk) - The company is subject to anti-money laundering laws and civil asset forfeiture risks, and its

Louisville, Colorado, Feb. 12, 2025 (GLOBE NEWSWIRE) -- CEA Industries Inc. (NASDAQ: CEAD, CEADW) (“CEA Industries” or the “Company”), today announced that it has signed an agreement to acquire Fat Panda Ltd. (“Fat Panda”), a leading Canadian retailer and manufacturer of nicotine vape products, for an aggregate purchase price of CAD $18 million (USD $12.6 million) payable at closing. The Company will pay the purchase price with a combination of cash, CEA Industries common shares, and seller and bank debt. T ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Title of each class Trading Symbol(s) Name of each exchange on which registered Common Stock, $0.00001 par value CEAD Nasdaq Capital Markets Warrants to purchase common stock CEADW Nasdaq Capital Markets FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT ...

Louisville, Colorado, Aug. 14, 2024 (GLOBE NEWSWIRE) -- CEA Industries Inc. (NASDAQ: CEAD, CEADW) ("CEA Industries" or the "Company"), is reporting results for the three months ended June 30, 2024. Second Quarter 2024 Financial Summary (in $ thousands, excl. margin items): | --- | --- | --- | --- | --- | --- | --- | --- | --- | |--------------------|---------------------|-------|-------|-------|---------------------|-------|---------------------|-------| | | | | | | | | | | | | Q2 2024 (unaudited) | | | | Q ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Title of each class Trading Symbol(s) Name of each exchange on which registered Common Stock, $0.00001 par value CEAD Nasdaq Capital Markets Warrants to purchase common stock CEADW Nasdaq Capital Markets FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 19 ...

Core Points - CEA Industries Inc. announced a 1-for-12 reverse stock split of its outstanding shares of common stock [1][2] - The reverse stock split will convert every twelve shares into one share, with the adjusted purchase price for warrants set at $60.00 per share [2][4] - The company aims to maintain its listing on the Nasdaq Capital Market through this action [4] Company Information - CEA Industries Inc. provides solutions for the controlled environment agriculture industry, supporting the development of the global ecosystem for indoor cultivation [7] - The common stock will begin trading on a split-adjusted basis starting June 7, 2024, and a new CUSIP number has been assigned for the common stock [5][6]

Louisville, Colorado, June 04, 2024 (GLOBE NEWSWIRE) -- CEA Industries Inc. (the "Company") (NASDAQ: CEAD) announced that it approved a 1-for-12 reverse stock split of the outstanding shares of common stock and corresponding adjustment to the publicly traded common stock purchase warrants. Pursuant to the reverse stock split, each twelve (12) shares of the Company's outstanding common stock, $0.00001 par value per share, will be automatically combined and converted into one (1) outstanding share of common s ...

Louisville, Colorado, May 14, 2024 (GLOBE NEWSWIRE) -- CEA Industries Inc. (NASDAQ:CEAD, CEADW))) ("CEA Industries" or the "Company"), is reporting results for the three months ended March 31, 2024. First Quarter 2024 Financial Summary (in $ thousands, excl. margin items): | | Q1 2024 | | | Q4 2023 | | Q1 2023 | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | (unaudited) | | | (unaudited) | | (unaudited) | | | | Revenue | $ | 235 | | $ 251 | | $ | 4,683 | | | Gross Profit | $ | (154 | ) | $ ...

None Condensed Consolidated Statements of Changes in Shareholders' Equity for the Three Months Ended March 31, 2024 and March 31, 2023 3 i This Quarterly Report on Form 10-Q, including "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Item 2, contains forward-looking statements that involve substantial risks and uncertainties. These forward-looking statements are not historical fact but are based on current management expectations that involve substantial risks, unce ...