Polished.com (US:POL)2021-08-12 10:48Financial Performance - Product sales for the three months ended June 30, 2021, reached $64,072,098, an increase of $48,787,067, or 319.18% compared to $15,285,031 for the same period in 2020[188] - Total revenue for the three months ended June 30, 2021, was $64,072,098, a significant increase from $15,285,031 in the same period of 2020, representing a growth of 319.56%[192] - Product sales for the six months ended June 30, 2021, were $77,769,466, including $47,780,835 from Appliances Connection, representing an increase of $52,807,257 or 211.55% from $24,962,209 in the same period of 2020[208] - Total revenue for the six months ended June 30, 2021, was $77,769,466, a significant increase from $24,962,209 in the same period of 2020[210] - Gross profit for the three months ended June 30, 2021, was $13,055,489, representing 20.38% of net sales, up from 17.01% in 2020[189] - Gross profit for the three months ended June 30, 2021, was $13,055,489, an increase of $10,455,616 or 402.16% from $2,599,873 in the same period of 2020[194] - Gross profit for the six months ended June 30, 2021, was $15,683,946, an increase of $11,518,065, or 276.49%, compared to $4,165,881 in the same period of 2020[212] - The net income for the three months ended June 30, 2021, was $4,032,694, compared to a net loss of $4,951,828 in the same period of 2020[189] - Net income for the three months ended June 30, 2021, was $4,032,694, an increase of $8,984,522 or 181.44% compared to a net loss of $4,951,828 in the same period of 2020[204] - The company reported a net income of $539,479 for the six months ended June 30, 2021, compared to a net loss of $7,158,748 for the same period in 2020, marking an increase of $7,698,227, or 107.54%[221] Expenses and Losses - Total operating expenses for the three months ended June 30, 2021, were $14,318,319, or 22.35% of net sales, compared to 26.09% in 2020[189] - Personnel expenses for the three months ended June 30, 2021, were $4,821,168, an increase of $3,780,979 or 363.49% compared to $1,040,189 in the same period of 2020[195] - General and administrative expenses for the three months ended June 30, 2021, were $2,500,381, an increase of $990,964 or 65.65% from $1,509,417 in the same period of 2020[201] - The company experienced a loss from operations of $1,262,830 for the three months ended June 30, 2021, compared to a loss of $1,387,999 in 2020[189] - The company incurred operating losses of approximately $4,543,516 and negative cash flow from operations of $6,985,302 for the six months ended June 30, 2021[223] Acquisition and Integration - The acquisition of Appliances Connection contributed $47,780,835 to product sales from June 2, 2021, to June 30, 2021[188] - The company incurred acquisition expenses of $357,411 related to the acquisition of Appliances Connection during the three months ended June 30, 2021[199] - The acquisition of Appliances Connection on June 2, 2021, is expected to positively impact future profitability, as only 29 days of their operations are included in the current results[223] - Cost of goods sold increased by $41,289,192, or 198.54%, to $62,085,520 for the six months ended June 30, 2021, primarily due to the acquisition of Appliances Connection[211] Operational Insights - Site sessions increased to approximately 5.3 million in the three months ended June 30, 2021, compared to 3.1 million in the same period of 2020[187] - The company’s logistics infrastructure is seen as a competitive advantage, enhancing efficiency and reducing costs[173] - The company plans to leverage Appliances Connection's logistics technology to improve operational efficiencies and reduce costs[174] - The impact of the COVID-19 pandemic has not materially affected operations due to the company's online sales model[175] - For the three months ended June 30, 2021, the company experienced cancellations approximating $11.5 million due to supply chain issues related to COVID-19, with a shipping ratio of 47.3% compared to a historical ratio of 80.7%[190] - For the six months ended June 30, 2021, the company experienced cancellations of customer orders due to supply chain issues, estimating losses of approximately $22.5 million[209] - The impact of COVID-19 on the company's business remains uncertain, but it has been factored into future operational assumptions[225] Cash and Financing - As of June 30, 2021, the company had cash and cash equivalents of $45,234,542 and restricted cash of $8,385,848, indicating strong liquidity[222] - Net cash provided by financing activities for the six months ended June 30, 2021, was $248,826,442, compared to net cash used of $353,566 for the same period in 2020[229] - The public offering on June 2, 2021, generated total gross proceeds of $205,020,000, with net proceeds of approximately $190,481,100 after underwriting commissions and expenses[231] - A credit and guaranty agreement was established on June 2, 2021, providing senior secured credit facilities totaling $70,000,000, including a $60,000,000 term loan and a $10,000,000 revolving credit facility[235] - As of June 30, 2021, the outstanding balance of the term loan was $56,311,521, with principal repayments of $1,500,000 due quarterly starting September 30, 2021[237] - The term loan bears interest at the LIBOR rate plus an applicable margin of 3.9%, with an initial interest period of six months[236] Other Financial Information - The company reported a total other expense of $2,752,954 for the three months ended June 30, 2021, a decrease from $4,252,782 in the same period of 2020[202] - The company entered into a management services agreement with a quarterly fee of $62,500, expensing the same amount for the three months ended June 30, 2021, and 2020[243] - The company has no off-balance sheet arrangements that could materially affect its financial condition or results of operations[250] - The company issued a 10% OID senior secured promissory note in the principal amount of $2,750,000 to institutional investors, receiving net proceeds of $4,590,000 after fees[234] - As of June 30, 2021, an aggregate of 1,039,148 warrants were converted to common stock, yielding proceeds of $2,338,083[232]