Net Element(MULN) - 2025 Q3 - Quarterly Results

Executive Summary & Business Update Bollinger Innovations reported quarterly results, detailing strategic manufacturing shifts, brand unification, and key product and financial updates Company Overview and Strategic Initiatives Bollinger Innovations announced its quarterly results, emphasizing efforts to reduce cash burn and a strategic move of Bollinger B4 manufacturing to its Tunica, Mississippi plant. This initiative aims to streamline operations, reduce manufacturing costs, and consolidate commercial vehicle production. The company also unified its commercial EV brands under Bollinger Innovations, Inc - Strategic move of Bollinger B4 manufacturing to Tunica, Mississippi, aims to streamline operations, reduce manufacturing costs, and consolidate commercial vehicle production[1][3] - Commercial EV brands were unified under Bollinger Innovations, Inc. in July 2025[3][4] Recent Business and Product Highlights The company implemented a $7,500 pricing adjustment for Class 1 and Class 3 commercial EVs, potentially offering up to $15,000 in savings with federal tax credits. It increased ownership in Bollinger Motors to 95%, resolving prior claims. Recent sales include B4 deliveries to The Lower East Side Ecology Center and EnviroCharge, and the Urban Delivery van to Global Expert Shipping. The company now accepts cryptocurrency for vehicle purchases and showcased new battery packs - A $7,500 pricing adjustment on Class 1 and Class 3 commercial EVs, combined with federal tax credits, offers up to $15,000 in savings per vehicle[4][8] - Ownership of Bollinger Motors increased to 95% on June 2, 2025, regaining full control and resolving claims and debt[4] - Deliveries include Bollinger B4 Class 4 trucks to The Lower East Side Ecology Center and EnviroCharge, and the Urban Delivery Class 1 EV cargo van to Global Expert Shipping[4][8] - The company now accepts cryptocurrency, including Bitcoin and the $TRUMP meme coin, for commercial electric vehicle purchases[8] - A partnership with Enpower Greentech Inc. was signed to build SWIFT solid-state batteries, showcasing 30 kWh and 80 kWh battery packs[8] Financial Performance Overview The company reported a net loss, a significant decrease in cash, and negative working capital, but also reduced operating and investing cash burn and increased financing activities, alongside successful claim settlements and a post-period equity increase Net Loss and Non-Cash Expenses The net loss attributable to common shareholders for the nine months ended June 30, 2025, was $291.8 million, with a significant portion ($227.1 million or 78%) attributed to non-cash expenses, an increase from $182.8 million (63%) in the prior year Net Loss Attributable to Common Shareholders | Period | Net Loss Attributable to Common Shareholders (Millions) | | :----- | :---------------------------------------------------- | | 9M FY25 | $(291.8) | | 9M FY24 | $(289.9) | Non-Cash Adjustments | Period | Non-Cash Adjustments (Millions) | % of Net Loss Attributable to Common Shareholders | | :----- | :------------------------------ | :------------------------------------------------ | | 9M FY25 | $227.1 | 78% | | 9M FY24 | $182.8 | 63% | Liquidity and Cash Flow Total cash decreased significantly to $0.9 million as of June 30, 2025, from $10.7 million on September 30, 2024. Working capital was negative $144.1 million. However, cash spent on operating and investing activities decreased by 53.7% year-over-year, and net cash provided by financing activities increased substantially Total Cash and Working Capital | Metric | June 30, 2025 (Millions) | Sept. 30, 2024 (Millions) | Change | | :----- | :----------------------- | :------------------------ | :----- | | Total Cash | $0.9 | $10.7 | -91.6% | | Working Capital | $(144.1) | N/A | N/A | Cash Spent (Operating & Investing) | Period | 9 Months Ended June 30, 2025 (Millions) | 9 Months Ended June 30, 2024 (Millions) | Change (Millions) | Change (%) | | :----- | :-------------------------------------- | :-------------------------------------- | :---------------- | :--------- | | Cash Spent (Operating & Investing) | $(73.6) | $(159.2) | $85.6 | -53.7% | Net Cash Provided by Financing Activities | Period | 9 Months Ended June 30, 2025 (Millions) | 9 Months Ended June 30, 2024 (Millions) | | :----- | :-------------------------------------- | :-------------------------------------- | | Net Cash Provided by Financing Activities | $63.7 | $7.5 | Settlement of Claims and Equity Changes The company successfully settled outstanding claims with creditors by transferring idle property, reducing accrued expenses from $51.6 million to $14.9 million. Subsequent to June 30, 2025, shareholder equity increased by over $110 million through the exchange of warrants and convertible notes for newly designated preferred stock, bringing estimated stockholders' equity to over $3 million as of August 14, 2025 - Outstanding claims with creditors were settled by transferring idle property, reducing accrued expenses from $51.6 million to $14.9 million[10] - Post-June 30, 2025, shareholder equity increased by over $110 million through the exchange of approximately $119 million in warrants and $30 million in convertible notes for preferred stock[2][11] - Estimated stockholders' equity as of August 14, 2025, exceeds $3 million[11] Condensed Consolidated Financial Statements The consolidated financial statements show a significant decrease in total assets and an increased stockholders' deficit, alongside substantial revenue growth from vehicle sales but a wider gross loss, and improved cash flow from operations and financing Condensed Consolidated Balance Sheets The balance sheet shows a decrease in total assets from $178.6 million (Sept 30, 2024) to $89.2 million (June 30, 2025), primarily driven by reductions in cash, inventory, and property, plant, and equipment. Total liabilities remained relatively stable, while stockholders' deficit increased significantly Balance Sheet Metrics | Metric | June 30, 2025 (Millions) | Sept. 30, 2024 (Millions) | | :----- | :----------------------- | :------------------------ | | Total Assets | $89.2 | $178.6 | | Total Liabilities | $196.3 | $195.2 | | Total Stockholders' Equity (Deficit) | $(107.1) | $(16.5) | Condensed Consolidated Statements of Operations For the nine months ended June 30, 2025, revenue from vehicle sales increased significantly to $8.3 million from $0.1 million in the prior year, but gross loss widened due to higher cost of revenues. Operating expenses decreased, but total other income (expense) worsened, leading to a net loss of $304.4 million, slightly lower than the prior year's $327.0 million Revenue and Gross Loss | Metric | Nine Months Ended June 30, 2025 (Millions) | Nine Months Ended June 30, 2024 (Millions) | Change | | :----- | :--------------------------------------- | :--------------------------------------- | :----- | | Revenue from sale of vehicles | $8.3 | $0.1 | +8200% | | Gross loss | $(15.8) | $0.05 | N/A | Net Loss | Metric | Nine Months Ended June 30, 2025 (Millions) | Nine Months Ended June 30, 2024 (Millions) | Change | | :----- | :--------------------------------------- | :--------------------------------------- | :----- | | Net loss | $(304.4) | $(327.0) | +7.0% | Condensed Consolidated Statements of Cash Flows Net cash used in operating activities decreased significantly to $69.4 million for the nine months ended June 30, 2025, from $145.2 million in the prior year. Net cash used in investing activities also decreased. Net cash provided by financing activities increased substantially to $63.8 million from $7.5 million, primarily due to proceeds from convertible notes and subsidiary notes Cash Flow Summary | Metric | Nine Months Ended June 30, 2025 (Millions) | Nine Months Ended June 30, 2024 (Millions) | Change | | :----- | :--------------------------------------- | :--------------------------------------- | :----- | | Net cash used in operating activities | $(69.4) | $(145.2) | +52.2% | | Net cash used in investing activities | $(4