Revenue Performance - Revenues for the first nine months of 2024 were $40.9 million, a 14% decrease from $47.3 million in the same period of 2023[96]. - Federal customer revenues decreased from $39.9 million in the first nine months of 2023 to $28.4 million in the same period of 2024[96]. - Revenues for Q3 2024 decreased by 30% to $11.5 million compared to $16.5 million in Q3 2023, marking the second highest third quarter revenues in company history[105]. - Revenues for the nine months ended September 30, 2024 decreased by 14% to $41.0 million compared to $47.3 million in the same period in 2023[108]. - Revenues derived from non-government commercial entities increased by 136% for the nine months from 2023 to 2024, representing 30.5% of total revenues in 2024[108]. Gross Margin and Profitability - Gross margin improved to 10.7% in Q3 2024, up from 1.7% in Q3 2023, primarily due to cost improvements and positive margins from the acquisition of Amiga[106]. - Gross profit for the nine months ended September 30, 2024 was $5.1 million, or 12% of sales, compared to $0.8 million, or 2% of sales in the same period in 2023[109]. - Operating expenses for Q3 2024 were a credit of $50 thousand, significantly down from $4.0 million, or 24% of revenues, in Q3 2023[107]. Cash Flow and Financial Position - Cash used in operating activities for the nine months ended September 30, 2024 was $3.1 million, a decrease from $13.8 million in the same period in 2023[112]. - Current assets decreased to $31.1 million on September 30, 2024, down by $9.6 million from December 31, 2023, primarily due to decreases in accounts receivable and cash[117]. - The Company may need to raise capital until achieving positive cash flow, which depends on increasing sales volumes and production cost reductions[120]. - Management cannot currently predict when or if the Company will achieve positive cash flow, and there is no guarantee of profitable operations[120]. Strategic Acquisitions and Market Position - Beam acquired Amiga DOO Kraljevo in October 2023, expanding its presence in the European market and enhancing manufacturing capabilities[93]. - Beam acquired Telcom d.o.o. Beograd in August 2024, improving its power electronics and telecommunications equipment manufacturing capabilities[94]. - The company believes the electric vehicle market will experience significant growth, increasing demand for EV charging infrastructure[97]. - The company received its first order for the BeamSpot™ product within two months of its launch, indicating strong market interest[102]. Cost Management and Operational Efficiency - The company has invested in a federal lobbyist and business development resources to identify opportunities and increase awareness of its products[96]. - The company’s proprietary energy storage solutions and patented renewable energy products reduce installation costs and complexity compared to traditional grid-tied alternatives[95]. - The company’s energy security business enhances the value proposition of its charging products by providing emergency power during grid failures[101]. - The company anticipates further reductions in costs due to operational support from Serbian facilities, which are expected to improve gross margins in future quarters[106]. - The Serbian operations are contributing to cost reductions for product manufacturing in both Europe and the U.S.[118]. Internal Controls and Compliance - Material weaknesses in internal controls over financial reporting were identified, particularly during the implementation of the NetSuite ERP system[124]. - The Company is actively working to remediate identified material weaknesses and strengthen internal controls over financial reporting[126]. - The Company has taken steps to ensure proper segregation of duties and adequate training for employees in relation to internal controls[128]. Supply Chain and Financing - The Company has entered into a Supply Chain Line of Credit with OCI Limited for up to $100 million, based on approved accounts receivable[119]. - The Company has not drawn on the Supply Chain Line of Credit to date[119]. - The Company implemented price increases in Q3 2023 to offset inflationary costs, which are beginning to positively impact new orders[118].
BEAM GLEQ.WARRT(BEEMW) - 2024 Q3 - Quarterly Report