Core Viewpoint - Flux Power Holdings, Inc. is conducting its Q3 2025 earnings conference call, indicating a focus on financial results and future outlook [1]. Group 1: Company Overview - The conference call features key company participants including the CEO, CFO, and VP of Operations, highlighting the leadership team's involvement in discussing financial performance [1][5]. - A press release detailing the financial results was issued prior to the call, emphasizing the company's commitment to transparency and investor communication [4]. Group 2: Financial Performance - The call is set to present important factors that may influence the company's predictions regarding its financial performance, indicating a proactive approach to addressing potential uncertainties [4].

REIMAGINE THE ENERGY EXPERIENCE NASDAQ: FLUX May 8, 2025 Q3 FY 2025 Financial Results Conference Call SAFE HARBOR LANGUAGE This presentation contains forward-looking statements. All statements other than statements of historical fact contained in this presentation, including statements as to the Company's future results of operations and financial position, planned products and services, business strategy and plans and objectives of management for future operations, are forward-looking statements. These sta ...

Company Performance - Flux Power Holdings, Inc. reported a quarterly loss of $0.12 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.09, but an improvement from a loss of $0.16 per share a year ago, indicating a surprise of -33.33% [1] - The company posted revenues of $16.74 million for the quarter ended March 2025, exceeding the Zacks Consensus Estimate by 2.62% and showing an increase from $14.46 million in the same quarter last year [2] - Over the last four quarters, Flux Power has not surpassed consensus EPS estimates, but it has topped consensus revenue estimates twice [2] Stock Performance - Flux Power shares have increased by approximately 20.9% since the beginning of the year, contrasting with a decline of -4.3% in the S&P 500 [3] - The company's current consensus EPS estimate for the upcoming quarter is -$0.06 on revenues of $16.61 million, and for the current fiscal year, it is -$0.36 on revenues of $65.9 million [7] Industry Outlook - The Electronics - Miscellaneous Products industry, to which Flux Power belongs, is currently ranked in the bottom 40% of over 250 Zacks industries, suggesting potential challenges ahead [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact Flux Power's stock performance [5]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 increased by 16% to $16.7 million compared to $14.5 million in Q3 2024, driven by higher demand in material handling and ground support equipment markets [15] - Gross profit for Q3 2025 increased by 32.5% to $5.3 million, with gross margin rising to 32% from 28% in Q3 2024 [15][16] - Net loss for Q3 2025 was $1.9 million, an improvement from a net loss of $3.0 million in Q3 2024 [17] Business Line Data and Key Metrics Changes - Unit growth in material handling and ground support equipment markets was reported at 1025% [15] - Selling and administrative expenses increased to $5.7 million in Q3 2025 from $5.3 million in Q3 2024, primarily due to professional fees related to a multi-year restatement of financial statements [16] Market Data and Key Metrics Changes - The company is experiencing increased interest from Tier 1 customers in adopting lithium-ion solutions for distribution centers, indicating a shift towards electrification despite economic uncertainties [28] Company Strategy and Development Direction - The company has aligned five strategic initiatives: profitable growth, operational efficiencies, solution selling, product innovation, and software/recurring revenue [5][6] - The launch of the G96 solution aims to advance electrification in airline drone support equipment, positioning the company as a technology leader in clean, high-performance ground support equipment [7][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining operational resilience despite tariff pressures and geopolitical complexities, focusing on supplier diversification and domestic assembly capabilities [12][14] - The company anticipates minimal impact from tariff increases in Q4 2025 due to good inventory levels [40] Other Important Information - The company announced a patent award for an AI-based algorithm for Intelligent Battery Lifecycle Maximization, indicating a shift towards becoming a technology-driven energy solutions provider [9][10] Q&A Session Summary Question: Sensitivity of customers to pricing actions from tariffs - Management noted that customers are committed to their ESG goals and transformation efforts, indicating a stable business environment despite tariff impacts [22] Question: Feedback on Sky BMS and potential ROI - Management highlighted that Sky BMS is crucial for customers to realize value, with expected ROI from reduced maintenance visits and better integration with existing technologies [24][25] Question: Adoption of lithium-ion in the forklift market - Management reported increased interest from customers in adopting lithium solutions, with competitors facing challenges due to tariffs, potentially providing a market share advantage [28] Question: Changes from new sales personnel - Management indicated positive changes from new sales personnel, positioning the company as a software provider with strong battery solutions [34] Question: Deployment timeline for G96 model - Management confirmed that the G96 model is in customer testing and production, with expectations for rapid deployment in the GSE market [37]

Financial Performance - Revenues for the three months ended March 31, 2025, increased to $16,742,000, up 15.8% from $14,457,000 in the same period of 2024[17] - Gross profit for the nine months ended March 31, 2025, was $15,968,000, representing a 17.0% increase compared to $13,641,000 for the same period in 2024[17] - Operating loss for the three months ended March 31, 2025, improved to $(1,577,000), a reduction of 38.7% from $(2,572,000) in the prior year[17] - Net loss for the nine months ended March 31, 2025, was $(5,495,000), a decrease of 9.8% compared to $(6,089,000) for the same period in 2024[22] - Revenues for Q1 2025 were $16,742,000, a 16% increase from $14,457,000 in Q1 2024, driven by higher demand in material handling and ground support markets[155] - Gross profit for Q1 2025 was $5,287,000, representing 32% of revenue, up from 28% in Q1 2024, due to decreased warranty-related expenses[157] - Net loss for Q1 2025 decreased to $1,939,000 from $3,005,000 in Q1 2024, primarily due to increased gross profit[161] - Revenues for the nine months ended March 31, 2025, were $49,697,000, an increase of $2,250,000 or 5% compared to $47,447,000 for the same period in 2024[164] - Net loss for the nine months ended March 31, 2025, was $5,495,000, an improvement from a net loss of $6,089,000 in 2024[170] Cash Flow and Liquidity - Cash at the end of the period was $505,000, down from $643,000 at the beginning of the period, indicating a decrease of 21.5%[21] - The Company generated cash flows from operations of $2.2 million for the nine months ended March 31, 2025[41] - Cash flow from operating activities was $2,208,000 for the nine months ended March 31, 2025, compared to a cash outflow of $4,274,000 in 2024[177] - As of March 31, 2025, the company had a cash balance of $0.5 million and anticipated that existing resources would not be sufficient to meet capital needs for the next twelve months[176] Liabilities and Debt - Total current liabilities increased to $34,191,000 as of March 31, 2025, compared to $30,674,000 as of June 30, 2024, reflecting a 11.0% rise[15] - The Company has relied on debt and equity financing for additional funds due to insufficient revenues and operating cash flows[41] - The Company has a revolving loan facility with GBC for up to $15.0 million, maturing on July 28, 2025[49] - The Company entered into a Credit Facility Agreement with Cleveland Capital, L.P. for a line of credit of up to $2,000,000 for working capital purposes[70] - The Company had multiple drawdowns under the GBC Credit Facility totaling $46.9 million and made repayments totaling $49.7 million during the nine months ended March 31, 2025[52] - As of March 31, 2025, the outstanding balance under the GBC Credit Facility was approximately $11.0 million, with up to $5.0 million available for future borrowings[52] - The Company received a waiver for a default related to the EBITDA covenant for the trailing three-month period ended April 30, 2024, subject to certain conditions[53] - The Company paid a non-refundable closing fee of $112,500 upon the execution of the GBC Credit Facility Agreement[50] - The Company agreed to pay GBC a non-refundable amendment fee of $50,000 in cash for the Third Amendment to the Loan and Security Agreement[55] Inventory and Receivables - Accounts receivable increased slightly to $9,847,000 as of March 31, 2025, compared to $9,773,000 as of June 30, 2024[15] - Inventories decreased from $16.977 million as of June 30, 2024, to $16.433 million as of March 31, 2025[47] Operational Challenges and Strategies - The Company expects to increase selling prices of its products to offset the impact of tariffs, which may negatively affect revenues and cash flows[35] - The Company is facing uncertainties due to increased tariffs and supply chain disruptions, which may impact future operations[33] - Management is evaluating strategies to improve profitability, including planned price increases and cost-saving initiatives[45] - The company is actively pursuing alternative sourcing strategies to mitigate the impact of U.S. tariffs on imported materials, particularly from China[138] - The company experienced delays in new orders due to deferrals of forklift purchases, attributed to lower capital spending and interest rate variability[133] Legal and Compliance Issues - The company is involved in various legal proceedings, including a shareholder derivative action related to the same allegations as the securities class action[203] - The company has received a notice from Nasdaq regarding non-compliance with continued listing requirements, which could lead to delisting if not addressed[210] - The company intends to take all reasonable measures to regain compliance with Nasdaq Listing Rules and maintain its listing[211] Research and Development - The company has filed three new patents related to advanced lithium-ion energy storage solutions, focusing on optimizing battery life, enhancing user understanding of battery health, and applying artificial intelligence for predictive balancing[130] - A new partnership was announced to enhance the recycling process for end-of-life lithium-ion batteries, marking a commitment to environmental responsibility[136] - The company is expanding its telemetry solution to improve asset management and service maintenance for customers[135] Employee and Stock Compensation - The Company reported stock-based compensation of $831,000 for the nine months ended March 31, 2025, down from $1,233,000 in the same period of 2024[22] - The 2021 Equity Incentive Plan allows for the issuance of awards for up to 2,000,000 shares, with 872,039 shares available for future grants as of March 31, 2025[93] - The company had 68,228 Restricted Stock Units (RSUs) outstanding as of March 31, 2025, with a weighted average grant date fair value of $4.25[97] - The company granted no stock options during the nine months ended March 31, 2025, while the expected volatility for this period was 80.06%[95]

Revenue Growth - Q3 2025 revenue increased 16% to $16.7 million compared to $14.5 million in Q3 2024, driven by higher demand in material handling and ground support markets, with unit growth of 10% and 25% respectively[12]. - Revenues for the three months ended March 31, 2025, were $16,742,000, an increase of 15.8% compared to $14,457,000 for the same period in 2024[34]. Profitability and Loss - Gross profit for Q3 2025 rose 31% to $5.3 million, with gross margin increasing to 32% from 28% in Q3 2024, reflecting a 374 basis point improvement due to reduced warranty-related expenses[13]. - The company reported a net loss of $1.9 million in Q3 2025, an improvement from a loss of $3.0 million in Q3 2024, primarily due to increased gross profit[16]. - Adjusted EBITDA loss improved to $1.1 million in Q3 2025 from a loss of $1.7 million in Q3 2024, indicating operational efficiency gains[15]. - Operating loss for the three months ended March 31, 2025, was $1,577,000, an improvement from a loss of $2,572,000 in the same period of 2024[34]. - Net loss for the nine months ended March 31, 2025, was $5,495,000, compared to a net loss of $6,089,000 for the same period in 2024[34]. Cash Flow and Financial Position - Cash on hand was $0.5 million as of March 31, 2025, with available working capital including a $16.0 million credit facility[17]. - Cash flows from operating activities for the nine months ended March 31, 2025, provided $2,208,000, a significant improvement from cash used of $(4,274,000) in the same period of 2024[36]. - The company reported a net cash change of $(138,000) for the nine months ended March 31, 2025, compared to $(1,129,000) for the same period in 2024[36]. - Total current assets decreased to $27,347,000 as of March 31, 2025, from $28,338,000 as of June 30, 2024[32]. - Total liabilities increased to $34,938,000 as of March 31, 2025, compared to $32,107,000 as of June 30, 2024[32]. - The company’s accumulated deficit increased to $(105,207,000) as of March 31, 2025, from $(99,712,000) as of June 30, 2024[32]. Product Development and Innovation - The new SkyEMS software platform aims to create a recurring revenue stream by enhancing battery life management through AI and machine learning features[3]. - Flux Power launched the G-Series G96-G2 High Voltage lithium-ion energy solution, designed for demanding ground support equipment applications in the airline industry[3]. - Flux Power was awarded a patent for its Intelligent Battery Cycle Life Maximization Algorithm, enhancing its transition to a technology-driven energy solutions provider[9]. Orders and Backlog - The company received purchase orders totaling over $6 million from six new large North American airlines, with an open order backlog of $16.9 million as of March 31, 2025[4]. Shareholder Information - The weighted average number of common shares outstanding for the three months ended March 31, 2025, was 16,684,320, compared to 16,538,998 for the same period in 2024[34].

Core Points - The Board of Directors of Fluxys Belgium SA has invited shareholders to attend the Ordinary and Extraordinary General Meetings on May 13, 2025, starting at 2:30 PM [1] - The meetings will take place at the BNP Event Center, located at Rue Royale 20, 1000 Brussels [1] - Additional documents related to the General Meetings and the integrated annual report for 2024 are available on the Fluxys Belgium website [1]

Summary of Flux Power Holdings Fiscal First and Second Quarter 2025 Financial Results Conference Call Company Overview - **Company**: Flux Power Holdings - **Industry**: Lithium-ion energy storage solutions, focusing on ground support equipment and material handling markets Key Points and Arguments Leadership and Vision - Krishna Vanka appointed as CEO, bringing 18 years of experience in technology sectors including renewable energy and EV transition [6][7] - Emphasis on building Flux Power into a market leader in lithium-ion energy storage solutions [7] Financial Performance - **Q1 2025**: Revenue increased by 9% year-over-year to $16.1 million, driven by higher shipments in ground support equipment [8][24] - **Q2 2025**: Revenue decreased by 8% year-over-year to $16.8 million but increased by 4% sequentially from Q1 [9][26] - Gross profit for Q1 2025 rose 23% to $5.2 million, with gross margin improving to 32% from 29% in Q1 2024 [9][24] - Q2 2025 gross profit increased by 2% to $5.5 million, with gross margin at 33% compared to 30% in Q2 2024 [10][26] - Adjusted EBITDA loss improved to $600,000 in Q1 2025 from a loss of $1.2 million in Q1 2024, while Q2 2025 saw a loss of $1 million [9][10][22] Market Dynamics and Demand - Increased demand for lithium-ion solutions, particularly in ground support and material handling markets [11][35] - Anticipated growth in order flow, with a backlog of $21.2 million as of September 30, 2024, and $17.5 million as of December 31, 2024 [9][10] - Customers are increasingly interested in transitioning from lead-acid to lithium-ion batteries, with telemetry features enhancing product appeal [35][36] Product Development and Innovation - Introduction of new heavy-duty models to meet customer demand, particularly in aggressive operations [11][37] - Telemetry product, Sky BMS, in pilot stage for a Fortune 50 company, enhancing asset management capabilities [11][17] - Strategic partnership with a top forklift OEM to launch a private label battery program, enhancing product safety and durability [16] Operational Challenges and Strategic Initiatives - Experienced delays in orders due to revised timing of forklift deliveries and economic uncertainties [14] - Focus on expanding sales and marketing initiatives to capitalize on fleet-wide replacement trends [14][15] - No known lost customers or orders to competition, indicating strong market position [15] Financial Outlook - Q3 2025 revenues expected to align with Q2 results, with a stronger trajectory anticipated in Q4 [29][55] - Positive cash flow anticipated in Q4 2025, with revenue growth projected between 5% to 10% [30][55] - Continued focus on cost reductions and strategic supply chain improvements to enhance profitability [22][23] Customer Engagement and Market Position - Achieved deployment of over 25,000 lithium-ion packs across North America, with strong customer retention [15][18] - New accounts secured in various sectors, including medical supply and food and beverage industries [19][20] - Emphasis on proactive demand generation and solution selling to enhance market penetration [58] Software and Telemetry Revenue Potential - Potential for software revenue generation from telemetry data, with aspirations to make it a material part of the revenue mix [67][69] Additional Important Content - The company has implemented measures to rectify inventory accounting issues and is now caught up with financial filings [29] - The leadership team has been strengthened with key appointments to drive growth and innovation [12][31] This summary encapsulates the critical insights and developments discussed during the conference call, highlighting Flux Power's strategic direction, financial performance, and market opportunities.

Financial Performance - Operating revenue for Fluxys Belgium reached EUR 608.8 million in 2024, an increase of EUR 16.0 million from EUR 592.8 million in 2023 [2] - Consolidated net profit rose to EUR 82.1 million in 2024, up from EUR 77.4 million in 2023, marking an increase of EUR 4.7 million [4][20] - EBITDA for 2024 was EUR 302.3 million, compared to EUR 285.8 million in 2023 [1] Investments and Assets - Investments in property, plant, and equipment totaled EUR 92.1 million in 2024, a decrease from EUR 167.7 million in 2023 [6] - Total property, plant, and equipment stood at EUR 1.8 billion in 2024, down from EUR 1.87 billion in 2023 [1] - Net financial debt decreased to EUR 159.8 million in 2024 from EUR 219.4 million in 2023 [1] Operational Highlights - The switch to high-calorific gas was successfully completed in 2024, eliminating the use of low-calorific gas in Belgium [9] - The first biomethane plant connected to the Fluxys network began operations in October 2024, producing enough biomethane for approximately 7,000 households [10] - Fluxys hydrogen was appointed as the operator of the hydrogen transmission network in Belgium, aligning with the federal hydrogen strategy [11][12] Regulatory and Strategic Developments - The 2024-2027 tariff methodology established by the regulator CREG aims to cover all reasonable costs and incentivize efficiency [5] - Fluxys Belgium is actively involved in the HY4Link project to develop cross-border hydrogen transmission infrastructure with partners in Luxembourg and France [13][14] - The company is committed to carbon capture, usage, and storage (CCUS) initiatives to support decarbonization efforts in Belgium [15] Workforce and ESG Initiatives - In 2024, Fluxys Belgium hired 91 new employees, bringing the total workforce to 982 [19] - The company is on track to meet its Environment, Social, and Governance (ESG) targets set in 2023 [18]

Financial Performance - Revenues for the three months ended September 30, 2024, increased to $16,125,000, up 9.1% from $14,787,000 in the same period of 2023[19] - Gross profit for the same period was $5,218,000, representing a gross margin of 32.4%, compared to $4,235,000 and a margin of 28.6% in 2023[19] - Operating loss narrowed to $1,212,000 for Q1 2024, compared to a loss of $1,785,000 in Q1 2023, indicating improved operational efficiency[19] - Net loss for the three months ended September 30, 2024, was $1,669,000, a reduction from $2,188,000 in the prior year, resulting in a net loss per share of $0.10 compared to $0.13[19] - Adjusted EBITDA for Q3 2024 was a loss of $613,000, an improvement of $635,000 compared to a loss of $1,248,000 in Q3 2023[162] - Net loss for Q3 2024 was $1,669,000, compared to a net loss of $2,188,000 in Q3 2023, indicating a reduction in losses[162] Cash Flow and Liquidity - The company reported a net cash provided by operating activities of $944,000 for the three months ended September 30, 2024, compared to a net cash used of $3,093,000 in the same period of 2023[24] - Cash at the end of the period was $559,000, down from $643,000 at the end of the previous quarter[24] - As of September 30, 2024, the company had a cash balance of $0.6 million and $4.0 million available under its $16.0 million GBC Credit Facility[164] - The company anticipates that existing cash resources will not be sufficient to meet anticipated capital needs for the next twelve months[166] - There is substantial doubt about the company's ability to continue as a going concern, impacting its liquidity and operational plans[36] Assets and Liabilities - Total current assets decreased to $26,850,000 as of September 30, 2024, down from $28,338,000 at June 30, 2024[17] - Total liabilities slightly decreased to $31,727,000 from $32,107,000 in the previous quarter, reflecting a reduction in financial obligations[17] - The company’s accumulated deficit increased to $(101,381,000) as of September 30, 2024, from $(99,712,000) at June 30, 2024[21] - The company reported stockholders' equity of $194,000, which is below the Nasdaq minimum requirement of $2,500,000[199] Research and Development - Research and development expenses were $1,315,000 for the quarter, slightly up from $1,295,000 in the prior year, indicating continued investment in innovation[19] - The company plans to invest in research and development to enhance its product mix and improve production efficiencies[124] - The company has filed three new patents related to advanced lithium-ion energy storage technology, focusing on optimizing battery life, enhancing user understanding of battery health, and applying AI for predictive cell balancing[124][126] Customer and Supplier Relationships - The company had three major customers representing approximately $11,413,000 or 71% of total revenues for the three months ended September 30, 2024, compared to $12,555,000 or 85% in 2023[100] - One supplier accounted for approximately $3,986,000 or 31% of total purchases during the three months ended September 30, 2024[101] Legal and Compliance Issues - The company is currently delinquent in filing its Form 10-Q for the periods ended September 30, 2024, and December 31, 2024[200] - The company intends to file the delinquent reports by April 15, 2025, to regain compliance with Nasdaq listing rules[202] - The company is involved in multiple legal proceedings, including a securities class action and a shareholder derivative action, which may impact its financial condition[191][192] - The company has denied the merit of claims in employment-related actions and intends to defend against them vigorously[193][194] Strategic Initiatives - Management is evaluating strategies to improve profitability, including planned price increases and cost-saving initiatives[41] - The company intends to expand its supply chain and customer partnerships, seeking further partnerships and/or acquisitions to meet growth objectives[124] - The company is focused on expanding sales and marketing initiatives to secure new customer relationships and support the transition to lithium for current customers[130] Inventory and Expenses - The company’s inventories decreased from $16.977 million as of June 30, 2024, to $15.342 million as of September 30, 2024[43] - Selling and administrative expenses increased by $390,000 or 8% to $5,115,000 for the quarter ended September 30, 2024, primarily due to stock-based compensation and professional services[154] - Total rent expense for the three months ended September 30, 2024, was approximately $232,000, compared to $238,000 for the same period in 2023[114] Debt and Financing - The Company entered into a Credit Facility Agreement with Cleveland Capital, L.P., providing a line of credit of up to $2,000,000 for working capital purposes[64] - The outstanding balance under the GBC Credit Facility was approximately $12.0 million as of September 30, 2024, with up to $4.0 million available for future borrowings[49] - The company had $1.0 million of related party debt outstanding, compared to no related party debt balance as of June 30, 2024[63] Market Conditions - The company has experienced delays in new orders for energy storage solutions due to lower capital spending in the market sector[38] - The company has experienced delays in orders of new forklifts due to a general slowing of capital spending by customers, impacting the order backlog[128] - The company is experiencing delays in new orders for energy storage solutions due to lower capital spending and interest rate variability, impacting sales strategies[129]