Strong Entertainment(SGE) - 2023 Q4 - Annual Results

Revenue Growth - Revenue increased by 9.4% to $42.6 million in 2023 from $39.0 million in 2022, driven by higher sales of projection screens and equipment [4]. - Services revenue grew by 26.6% in Q4 2023 and 34.0% for the full year, aided by increased market share and the acquisition of Innovative Cinema Solutions (ICS) [5]. - Screen systems revenue increased by 5.3% in Q4 2023 and 7.2% for the full year, largely due to momentum in laser screen replacements [5]. - Net product sales for the year ended December 31, 2023, were $30,776,000, up 2.2% from $30,119,000 in 2022 [19]. - Net service revenues increased by 34.0% year-over-year to $11,840,000 in 2023 from $8,834,000 in 2022 [19]. Profitability - Gross profit rose to $10.6 million, representing 24.8% of revenues in 2023, compared to $9.5 million or 24.3% in 2022 [12]. - Net income from continuing operations was $3.0 million in 2023, up from $2.3 million in 2022 [12]. - Gross profit for the year was $10,577,000, representing an 11.8% increase compared to $9,462,000 in 2022 [19]. - Net income from continuing operations for Q4 2023 was $3,293,000, compared to $825,000 in Q4 2022 [23]. - The company reported a net loss of $1,905,000 for Q4 2023, compared to a net income of $725,000 in Q4 2022 [23]. Expenses and Adjusted EBITDA - Adjusted EBITDA decreased to $2.6 million in 2023 from $3.2 million in the prior year, impacted by higher general and administrative costs [12]. - Adjusted EBITDA for the year ended December 31, 2023, was $2,625,000, down from $3,216,000 in 2022 [23]. Assets and Cash Flow - Total assets increased to $26.5 million as of December 31, 2023, compared to $25.5 million in 2022 [18]. - Cash and cash equivalents at the end of 2023 were $5,470,000, an increase from $3,615,000 at the beginning of the year [21]. - Net cash provided by operating activities from continuing operations was $3,492,000, up from $1,692,000 in 2022 [21]. Strategic Changes - The company completed the acquisition of ICS assets in Q4 2023, enhancing the scale of its services business [3]. - The company plans to exit the content business to focus resources on core entertainment products and services [3]. Demand and Market Trends - Installation and maintenance services saw increased demand, contributing to overall revenue growth [4]. - The company incurred a foreign currency transaction loss of $406,000 for the year, compared to a gain of $528,000 in 2022 [23].