Financial Performance - For the three months ended March 31, 2025, net sales were $590,567, a decrease of 27.1% compared to $810,490 for the same period in 2024[19] - Gross profit for the first quarter of 2025 was $119,392, down 61.2% from $308,219 in the prior year[19] - The net loss for the first quarter of 2025 was $14,036,381, compared to a net loss of $4,532,363 for the same period in 2024, representing a 209.5% increase in losses[19] - The operating loss for the Company was $13,731,673, with the electric vehicle segment experiencing a loss of $13,250,409[124] Cash and Liquidity - Cash and cash equivalents at the end of the period were $211,284, a decrease of 89.1% from $1,049,357 at the end of the first quarter of 2024[25] - The company experienced a cash outflow from fraudulent activity amounting to $2,249,515, impacting its financial position[25] Operating Expenses - Total operating expenses increased significantly to $13,851,065, compared to $3,264,516 in the same quarter of 2024, primarily due to a goodwill impairment charge of $10,103,048[19] - Research and development costs increased to $98,398 for the three months ended March 31, 2025, compared to $70,265 for the same period in 2024, reflecting a 40% increase[53] - Non-cash stock-based compensation expense was $546,576 for the three months ended March 31, 2025, down from $1,818,383 for the same period in 2024, representing a decrease of 70%[54] Assets and Liabilities - Total current liabilities increased to $15,671,215, up from $11,744,671 at the end of 2024, indicating a rise of 33.3%[17] - The company had finished goods inventory of $6,261,697 as of March 31, 2025, with a net inventory balance of $6,249,268 after an inventory valuation allowance of $12,429[43] - Inventory deposits increased to $8,711,812 as of March 31, 2025, up from $6,036,809 as of December 31, 2024, indicating a 44% increase[44] - The company had trade accounts receivable of $865,721 as of March 31, 2025, with a net balance of $852,125 after an allowance for doubtful accounts of $13,596[40] Shareholder Information - The company reported a total of 23,106,392 common shares outstanding as of March 31, 2025, an increase from 19,872,612 shares at the end of 2024[22] - The Company has 9,672,482 outstanding stock options with a weighted average exercise price of $1.59 and an average remaining contractual life of 7.14 years[97] Business Operations and Expansion - The company added two new business operations in the first quarter of 2025: medical supplies and drones, expanding its business portfolio[27] - The Company plans to open a U.S. drone manufacturing facility following a Consulting and Manufacturing Agreement for a heavy lift drone, which is designed for the agricultural market[127] - The Company signed a non-binding letter of intent to acquire Kymera, a marine craft manufacturer, to establish a new marine division focused on electric marine mobility[128] Impairment and Charges - The company recorded a non-cash impairment charge of $10,103,048 for goodwill as of March 31, 2025, with no impairment charge recorded for the year ended December 31, 2024[52] - The company recorded a non-cash impairment charge of $10,103,048 for goodwill during the three months ended March 31, 2025, due to a decline in stock price[68] Debt and Financing - The total future annual minimum payments of the Company's outstanding debt as of March 31, 2025, amount to $4,570,099, including $186,756 for the remainder of 2025 and $4,383,343 for 2026[90] - The Company entered into a convertible promissory note agreement for $1,000,000 on January 18, 2024, which was later converted into 505,051 shares of common stock[77] - The Company has the right to require an investor to purchase up to $25 million of shares of common stock until November 1, 2027, under the amended standby equity purchase agreement[82] Market Risks - The Company is exposed to market risks related to raw material costs, particularly batteries, which could materially affect operating results[185]
Envirotech Vehicles(EVTV) - 2025 Q1 - Quarterly Report