Cemtrex(CETX) - 2025 Q1 - Quarterly Report

Revenue Performance - Security segment revenues decreased by $3,714,102 or 41% to $5,453,699 for the three months ended December 31, 2024, compared to $9,167,801 for the same period in 2023 due to unexpected delays in orders [142]. - Industrial Services segment revenues increased by $575,835 or 7% to $8,286,200 for the three months ended December 31, 2024, compared to $7,710,365 for the same period in 2023, driven by increased demand [143]. Profitability - Gross profit for the three months ended December 31, 2024, was $5,701,936 or 41% of revenues, down from $7,082,399 or 42% of revenues for the same period in 2023 [144]. Expenses - Research and Development expenses increased by $41,278 or 5% to $890,083 for the three months ended December 31, 2024, compared to $848,805 for the same period in 2023, related to the development of next-generation security solutions [148]. - Other expense for the three months ended December 31, 2024, was $26,265,257, significantly higher than $505,272 for the same period in 2023, primarily due to losses on warrants [149]. Working Capital and Cash Flow - Working capital decreased to $4,130,393 at December 31, 2024, from $8,103,457 at September 30, 2024, mainly due to increased current maturities of long-term debt and accrued expenses [153]. - Cash used by operating activities was $1,201,817 for the three months ended December 31, 2024, compared to $3,139,073 for the same period in 2023, reflecting a negative operating cash flow [154]. - Trade receivables decreased by $1,956,874 or 18% to $9,202,802 at December 31, 2024, from $11,159,676 at September 30, 2024, attributed to decreased sales in the Security segment [155]. Financing Activities - Cash provided by financing activities increased to $2,387,449 for the three months ended December 31, 2024, compared to $998,099 for the same period in 2023, driven by proceeds from the revolving line of credit and warrant exercises [157]. - The Company has secured a line of credit for its Vicon brand with available capacity of $903,102 as of December 31, 2024, to support operations [158].