Motorcar Parts of America(US:MPAA)2023-11-09 21:01Financial Performance - Consolidated net sales for the three months ended September 30, 2023, were $196,639,000, an increase of $24,096,000, or 14.0%, compared to $172,543,000 for the same period in 2022[103] - Gross profit for the three months ended September 30, 2023, was $41,148,000, representing 20.9% of net sales, up from $26,516,000, or 15.4%, for the same period in 2022[104] - Operating income for the three months ended September 30, 2023, was $13,937,000, an increase of $12,085,000, or 652.5%, from $1,852,000 for the same period in 2022[110] - Consolidated net sales for the six months ended September 30, 2023, were $356,344,000, an increase of $19,816,000, or 5.9%, compared to $336,528,000 for the same period in 2022[117] - Gross profit for the six months ended September 30, 2023, was $67,715,000, or 19.0% of net sales, compared to $56,818,000, or 16.9%, for the same period in 2022[118] - Consolidated operating income increased by $15,191,000, or 165.4%, to $24,378,000 for the six months ended September 30, 2023, compared to $9,187,000 for the same period in 2022[124] Expenses - Interest expense for the three months ended September 30, 2023, was $15,383,000, an increase of $6,100,000, or 65.7%, from $9,283,000 for the same period in 2022[111] - General and administrative expenses for the three months ended September 30, 2023, were $14,325,000, a decrease of $521,000, or 3.5%, from $14,846,000 for the same period in 2022[106] - Research and development expenses for the three months ended September 30, 2023, were $2,438,000, a decrease of $232,000, or 8.7%, from $2,670,000 for the same period in 2022[108] - General and administrative expenses decreased by $1,553,000, or 5.5%, to $26,927,000 for the six months ended September 30, 2023, compared to $28,480,000 for the same period in 2022[120] - Sales and marketing expenses decreased by $501,000, or 4.3%, to $11,107,000 for the six months ended September 30, 2023, compared to $11,608,000 for the same period in 2022[121] - Research and development expenses decreased by $970,000, or 16.8%, to $4,813,000 for the six months ended September 30, 2023, compared to $5,783,000 for the same period in 2022[122] - Interest expense increased by $10,899,000, or 67.3%, to $27,103,000 for the six months ended September 30, 2023, compared to $16,204,000 for the same period in 2022[125] Cash Flow and Working Capital - Cash flow provided by operations for the three months ended September 30, 2023, was $15,300,000, a significant improvement from cash used in operations of $(15,972,000) for the same period in 2022[102] - Net cash used in operating activities was $5,170,000 for the six months ended September 30, 2023, an improvement from $16,954,000 for the same period in 2022[133] - Working capital increased to $163,243,000 at September 30, 2023, compared to $154,886,000 at March 31, 2023, with a current ratio of 1.4:1.0[129] Debt and Liabilities - The company had $32,000,000 of convertible notes outstanding, bearing interest at 10% per year, maturing on March 30, 2029[130] - The company repaid the remaining outstanding balance of its term loans and recorded a loss on extinguishment of debt of $168,000 during the six months ended September 30, 2023[127] - The fair value of the compound net derivative liability was recorded as a liability of $11,300,000 at September 30, 2023[143] Receivables and Discounts - Receivables discounted for the six months ended September 30, 2023, were $255,303,000, down from $283,359,000 in 2022, indicating a decrease of approximately 9.9%[146] - The annualized weighted average discount rate increased to 6.6% in 2023 from 4.4% in 2022, reflecting a rise of 50%[146] - The amount of discount recognized as interest expense rose to $15,940,000 for the six months ended September 30, 2023, compared to $11,293,000 in 2022, an increase of approximately 41.5%[146] Capital Expenditures - Total capital expenditures for the six months ended September 30, 2023, were $315,000, significantly lower than $2,792,000 in 2022, representing a decrease of approximately 88.7%[148] - The company expects to incur approximately $4,000,000 in capital expenditures during fiscal 2024 to support operations[148] Other Information - Rent expense for a related party lease was $81,000 for the three months ended September 30, 2023, and $162,000 for the six months, indicating a consistent expense structure[149] - There have been no material changes to critical accounting policies since the last annual report filed on June 14, 2023[151] - No material changes in market risk have been reported since the last annual report filed on June 14, 2023[152]