Beam (US:BEEM)2025-05-15 21:10Financial Performance - Revenues for the first three months of 2025 were $6.3 million, a 57% decrease from $14.6 million in the same period of 2024[103]. - Revenues for the three months ended March 31, 2025, decreased by 57% to $6.3 million compared to $14.6 million in 2024, with 14% of product sales to Federal customers and 33% to State and Local governments[117]. - Gross profit for the same period was $0.5 million, representing a gross margin of 7.9%, down from $1.5 million and 10.2% in 2024; 88.4% of ARC sales reflected a price increase implemented in 2023[115][118]. - Total operating expenses increased to $16.0 million in Q1 2025, including a $10.8 million goodwill impairment, compared to $4.5 million in 2024[119]. - Cash used in operating activities was $1.8 million for Q1 2025, a decrease from $3.0 million in Q1 2024, with a net loss of $15.5 million adjusted by $12.5 million of non-cash expenses[121]. - Current assets decreased to $23.6 million at March 31, 2025, from $27.1 million at December 31, 2024, primarily due to a $2.1 million decrease in cash[125]. Revenue Sources - International customers accounted for 25% of total revenue as of March 31, 2025, compared to 11% for the same period in 2024[103]. - Revenues from non-government commercial entities increased by 41% from 2024 to 2025, representing 53% of total revenues in 2025[103]. - Sales to federal, state, and local governments represented 47% of revenues in the first three months of 2025, down from 84% in the same period of 2024[103]. Strategic Initiatives - The acquisition of Amiga expanded the company's presence into European, Middle Eastern, and African markets, enhancing production and sales capabilities[108]. - The company introduced new products, including rapidly deployed charging infrastructure for electric bicycles, scooters, and motorcycles, as well as a self-sufficient water treatment system[100]. - The company expects significant growth in the electric vehicle market, which will increase demand for EV charging infrastructure[106]. - The company has invested in a federal lobbyist and business development resources to identify opportunities and increase awareness of its products[105]. - The company achieved compliance with the Build America, Buy America Act, enhancing its credibility and demand among government agencies[106]. - The company has initiated a program of resellers and agents to expand its geographic footprint without significantly increasing operating costs[104]. - Beam acquired Telcom d.o.o. Beograd, enhancing its capabilities in power electronics and telecommunications equipment, which is expected to improve product margins and reduce costs[109]. - Beam is developing new patented products, including BeamSpot™ and UAV ARC™, which are anticipated to expand product offerings and market reach[113]. Financial Strategy and Capital - The Company entered into a Supply Chain Line of Credit with OCI Limited for up to $100 million based on approved accounts receivable[128]. - The Company has the right to sell up to $8 million in shares of its common stock under an At Market Issuance Sales Agreement with B. Riley Securities, Inc.[129]. - The company may need to raise capital to fund operations until achieving positive cash flow, with potential equity or debt financing options being considered[127]. - The Company has not drawn on the $100 million line of credit to date[128]. - The Company is required to pay interest on any drawdown at the Secured Overnight Financing Rate +300 basis points[128]. Management and Internal Controls - Management anticipates profitable growth through the addition of sales personnel, cost reductions, and increased public awareness of the Company and its products[130]. - The Company has identified material weaknesses in internal controls, including ineffective design over IT General Controls and inadequate inventory tracking[134]. - Remediation efforts are ongoing to address identified material weaknesses, including improving segregation of duties and enhancing training for employees[138]. - The Company has not maintained adequate controls for documentation of reconciliations and schedules prepared for financial statements[134]. - The Company is actively working to strengthen internal controls over financial reporting and has taken various actions to remediate material weaknesses[136]. - Management believes that successful execution of its strategic plan may generate sufficient revenue to continue operations, although there is no assurance of achieving these objectives[130].