Financial Performance - Residential contract sales decreased by $4,699,412, or 31%, due to a 22% reduction in residential kilowatts installed and a decrease in average price per system installed [208]. - Consolidated sales decreased by $18,703,410, or 31.1%, to $41,487,003 in the first nine months of 2024 from $60,190,413 in the first nine months of 2023 [209]. - Consolidated gross profit decreased to $14,833,527 in the first nine months of 2024 compared to $22,175,708 in the same period of 2023, with gross margin slightly decreasing to 36% [210]. - Consolidated operating loss from continuing operations in the first nine months of 2024 was $5,815,635, compared to a loss of $5,129,195 in the same period of 2023 [210]. - Net loss from continuing operations attributable to shareholders in the first nine months of 2024 was $20,617,094, or $(128.25) per diluted share, compared to a net loss of $5,262,534, or $(395.75) per diluted share, in the first nine months of 2023 [210]. - Consolidated selling, general and administrative expenses decreased by $3,123,771, or 14%, to $19,321,037 in the first nine months of 2024 from $22,444,808 in the same period of 2023 [210]. Corporate Actions - The company divested its legacy operations and operating assets through the sale of substantially all assets of JDL Technologies, Inc. and Ecessa Corporation on June 30, 2023 [205]. - The company has made several amendments to its Articles of Incorporation, with the latest being effective as of October 17, 2024 [3.4]. - A Certificate of Designation for Series C Convertible Preferred Stock was filed on September 9, 2024 [3.9]. - The company canceled the Certificate of Designation for Series B Preferred Stock effective August 14, 2024 [3.8]. - The restated bylaws of the company were amended and became effective on April 13, 2022 [3.6]. - The company filed a Certificate of Correction to the Certificate of Designation on September 23, 2024 [3.10]. - The company has undergone a name change from Communications Systems, Inc. to Pineapple Energy Inc. [3.5]. Compliance and Financial Needs - The company is in the process of formalizing a remediation plan to address material weaknesses in internal control over financial reporting [214]. - The company has raised over $2 million from an ATM Offering Agreement to sell shares up to $10,000,000, but additional funding may not be available on acceptable terms [212]. - The company needs to obtain substantial additional financing arrangements to provide working capital and growth capital, with potential adverse impacts if financing is not available [220]. - The company’s interim Chief Financial Officer, Andrew Childs, signed the report on November 14, 2024 [226]. - The company has filed multiple reports on Form 8-K and Form 10-Q throughout 2024, indicating ongoing compliance with SEC regulations [224]. - The company’s financial documents include various amendments and designations related to its preferred stock offerings [3.1]. - The company’s Articles of Amendment have been updated multiple times in 2024, reflecting changes in corporate governance [3.2].
Pineapple Energy (PEGY) - 2024 Q3 - Quarterly Report