Flux power holdings12/7/2023 We also continue to explore alternative capital opportunities to enable us to meet the demands of our aggressive growth trajectory. This renewal, along with our existing cash, will continue to meet our anticipated capital resources to fund planned operations. “We recently announced a renewal of the credit facility with Silicon Valley Bank, now a division of First Citizens Bank (“SVB Facility”), of $14.0 million to support higher working capital requirements related to increased customer demand. We have launched an in-house automated modular production initiative to manage module SKUs and accommodate diversification of cell suppliers and also utilized lower cost, more reliable, and secondary suppliers of key components including cells, steel, electronics, circuit boards and other production critical components. To address disruptions and reduce excess inventory, we have improved lean manufacturing processes and supply chain management. “Although global supply chain disruptions have lessened, we increased our inventory to $21 million as of March 31, 2023, to accommodate lengthening of forklift OEM delivery timelines being experienced in the material handling sector. while also, and importantly, resulting in lower service logistics costs incurred by our Company. Investment in the Atlanta office broadens our geographic footprint to bring comprehensive and responsive services to customers in the eastern half of the U.S. The facility will enable faster response times to our customer base, with an effective service and call center capability. “To supplement our customer support services in response to this growth in nationwide sales, we recently announced the opening of our new Atlanta facility. “The positive trend of operating leverage during the nine months ended March 31, 2023, versus prior year support our profitability goals with revenue growth of 85%, gross margin improvement of 197% against operating expense of a slight decrease. Adjusted EBITDA loss decreased $0.2 million for the quarter on a sequential basis, and decreased $8.7 million, or 74%, for the nine months ended Macompared to the nine months ended March 31, 2022. “We also continued to improve gross profit, up 146% in the third quarter to $4.7 million, and gross margin expansion of 16 basis points to 31% compared to the year ago period. “We continued our successful cadence of year-over-year revenue growth with our 19 th consecutive quarter of revenue growth, combined with a renewed credit facility providing additional cash to fund higher working capital requirements driven by increased customer demand and to meet our growth goals,” said Ron Dutt, Chief Executive Officer of Flux Power.
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