Financial Performance - Net revenues for Fiscal 2023 were $36,688,000, a decrease of 4.0% from $38,207,000 in Fiscal 2022[128] - Gross profit decreased to $8,364,000, with a gross margin decline from 23.0% in Fiscal 2022 to 22.8% in Fiscal 2023[129] - Operating income fell significantly by 72.8% to $160,000 compared to $588,000 in Fiscal 2022[128] - Income from continuing operations was $159,000, a decline of 64.7% from $450,000 in Fiscal 2022[128] - Fiscal 2023 consolidated revenues decreased to $36,688,000, down 4.0% from $38,207,000 in Fiscal 2022[135] Segment Performance - The design segment showed revenue growth, partially offsetting the decline in the OEM distribution segment[128] - OEM distribution segment revenues fell to $14,002,000, a decline of 22.4% compared to $18,036,000 in Fiscal 2022, primarily due to lower sales volume from diabetic customers[137] - Revenues from diabetic products decreased by 23.4% to $11,805,000 in Fiscal 2023, representing 84% of OEM distribution revenues, down from 85% in Fiscal 2022[140] - Operating income for the OEM distribution segment dropped to $440,000 in Fiscal 2023, with an operating income margin of 3.1%, down from 5.0% in Fiscal 2022[143] - Operating income for the design segment increased slightly, but the operating income margin decreased from 10.6% in Fiscal 2022 to 9.6% in Fiscal 2023 due to inflationary pressures[146] Expenses and Costs - Sales and marketing expenses increased by 12.5% to $1,663,000, rising as a percentage of revenue from 3.9% to 4.5%[130] - General and administrative expenses decreased to $6,541,000, primarily due to bad debt recoveries and lower share-based compensation[131] - Cash provided by operating activities in Fiscal 2023 was $1,041,000, compared to $1,535,000 in Fiscal 2022[151] - Working capital decreased to $26,000 as of September 30, 2023, from $1,209,000 a year earlier, primarily due to higher payables and accrued expenses[147] - The company reduced the fixed portion of its sourcing fee with Forward China from $100,000 to $83,333 per month, resulting in cash savings of $100,000 for Fiscal 2023[144] Other Financial Metrics - Other income reported was $19,000 in Fiscal 2023, contrasting with other expenses of $135,000 in Fiscal 2022[132] - The effective tax rate for Fiscal 2023 was 11.2%, compared to 0.5% in Fiscal 2022[133] Operational Changes - The company ceased operations of its retail distribution segment in July 2023, classifying it as discontinued operations[114] - A significant diabetic customer, which represented approximately 12% of consolidated net revenues in 2022, was lost in March 2023, expected to impact future OEM distribution revenues[136] - The company has approximately $3,800,000 in cash on hand and $1,300,000 available under a line of credit maturing on May 31, 2024[147]
Forward Industries(FORD) - 2023 Q4 - Annual Report