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Ipower Inc. (IPW) SEC Filing 10-K Annual Report for the fiscal year ending Friday, June 30, 2023

Ipower Inc.

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CIK: 1830072 Ticker: IPW

Exhibit 99.1

 

 

 

iPower Reports Fiscal Fourth Quarter and Full Year 2023 Results

 

- Fiscal 2023 Revenue up 12% to Record $88.9 Million, with Cash Flow from Operations of $9.2 Million -

 

- iPower Management to Host Conference Call Today at 4:30 p.m. Eastern Time -

 

DUARTE, CA, September 14, 2023 -- iPower Inc. (Nasdaq: IPW) (“iPower” or the “Company”), a tech and data-driven online retailer and supplier of consumer home and garden products, as well as a provider of value-added ecommerce services, today announced financial results for its fiscal fourth quarter and full fiscal year ended June 30, 2023.

 

Fiscal Q4 2023 Results vs. Year-Ago Quarter 

 

·Total revenue increased 6% to $23.4 million as compared to $22.1 million.

 

·Gross profit remained flat at $9.1 million, with gross margin of 38.7% as compared to 41.2%.

 

·Net loss attributable to iPower was $3.0 million or $(0.10) per share, as compared to net loss of $1.3 million or $(0.05) per share.

 

·As of June 30, 2023, net debt (total debt less cash) was reduced by 43% to $8.1 million as compared to net debt of $14.2 million as of June 30, 2022.

 

Fiscal 2023 Results vs. Fiscal 2022

 

·Total revenue increased 12% to $88.9 million as compared to $79.4 million.

 

·Gross profit increased 5% to $34.8 million as compared to $33.2 million, with gross margin of 39.1% compared to 41.8%.

 

·Net loss attributable to iPower was $12.0 million or $(0.40) per share, as compared to net income of $1.5 million or $0.06 per share. The fiscal 2023 period includes approximately $3 million related to a goodwill impairment incurred earlier in the fiscal year.

 

·Cash flow from operations improved significantly to $9.2 million as compared to cash used of $16.6 million.

 

Management Commentary 

 

“Fiscal 2023 marked our third consecutive year of double-digit revenue growth driven by consistent, strong demand for our in-house products and continued expansion of our non-hydroponic portfolio,” said Lawrence Tan, CEO of iPower. “Throughout the fiscal year, we emphasized in-house products sales which accounted for over 90% of revenue while continuing to diversify our product offerings beyond hydroponics, which grew to more than 75% of sales in fiscal 2023. We believe that our ability to generate double-digit growth while shifting our product mix into new categories demonstrates our superior product research, design and merchandising capabilities.”

 

iPower CFO, Kevin Vassily, added, “During the year, we continued to work through high-cost inventory buildup from prior periods, which has weighed on our gross margin in recent quarters. However, we have now sold through most of the excess inventory and expect gross margin to improve in fiscal 2024. With an improved supply chain, normalized inventory levels and continued demand for our in-house products, we believe that we are well positioned to execute on our growth and profitability objectives in fiscal 2024.”

 

 

 

 

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Fiscal Fourth Quarter 2023 Financial Results 

 

Total revenue in the fiscal fourth quarter of 2023 increased 6% to $23.4 million as compared to $22.1 million for the same period in fiscal 2022. The increase was primarily driven by greater product sales to the Company’s largest channel partner, as well as strong demand for iPower’s non-hydroponic product portfolio which now accounts for over 75% of revenue.

 

Gross profit in the fiscal fourth quarter of 2023 remained flat at $9.1 million compared to the same quarter in fiscal 2022. As a percentage of revenue, gross margin was 38.7% as compared to 41.2% in the year-ago period. The decrease in gross margin was primarily driven by a higher cost of goods sold related to inventory that previously incurred higher freight charges, as well as normal variations in product and channel mix.

 

Total operating expenses in the fiscal fourth quarter of 2023 were $12.0 million as compared to $10.6 million for the same period in fiscal 2022. The increase was driven in part by higher selling, fulfillment, and marketing costs related to the sale of inventory built up in prior quarters.

 

Net loss attributable to iPower in the fiscal fourth quarter of 2023 was $3.0 million or $(0.10) per share, as compared to a net loss of $1.3 million or $(0.05) per share for the same period in fiscal 2022. The decline was driven in part by the aforementioned higher operating expenses.

 

Cash and cash equivalents were $3.7 million at June 30, 2023, as compared to $1.8 million at June 30, 2022. Total debt as of June 30, 2023 was $11.8 million as compared to $16.0 million as of June 30, 2022. As a result of the Company’s debt paydown, iPower’s net debt (total debt less cash) position was reduced by 43% to $8.1 million as compared to $14.2 million as of June 30, 2022.

 

Conference Call 

 

The Company will hold a conference call today, September 14, 2023, at 4:30 p.m. Eastern Time to discuss the results for its fiscal fourth quarter and full fiscal year ended June 30, 2023.

 

iPower’s management will host the conference call, which will be followed by a question-and-answer session.

 

The conference call details are as follows:

 

Date: Thursday, September 14, 2023

Time: 4:30 p.m. Eastern Time

Dial-in registration link: https://register.vevent.com/register/BI3034b2b0ea624c2a9ac35ca1e37c42eb

Live webcast registration link: https://edge.media-server.com/mmc/p/ujcagrwy/

 

Please dial into the conference call 5-10 minutes prior to the start time. If you have any difficulty connecting with the conference call, please contact the Company’s investor relations team at IPW@elevate-ir.com.

 

The conference call will also be broadcast live and available for replay in the Events & Presentations section of the Company’s website at www.meetipower.com.

 

 

 

 

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About iPower Inc. 

 

iPower Inc. is a tech and data-driven online retailer and supplier of consumer home and garden products, as well as a provider of value-added ecommerce services for third-party products and brands. iPower offers thousands of stock keeping units from its in-house brands as well as hundreds of other brands through its ecommerce channel partners and its websites, www.zenhydro.com and www.simpledeluxe.com. iPower has a diverse customer base that includes both commercial businesses and individuals. For more information, please visit iPower's website at www.meetipower.com.

 

Forward-Looking Statements 

 

All statements other than statements of historical fact in this press release are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations and projections about future events and financial trends that iPower believes may affect its financial condition, results of operations, business strategy, and financial needs. Investors can identify these forward-looking statements by words or phrases such as “may,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “potential,” “continue,” “is/are likely to” or other similar expressions. iPower undertakes no obligation to update forward-looking statements to reflect subsequent events or circumstances, or changes in its expectations, except as may be required by law. Although iPower believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and iPower cautions investors that actual results may differ materially from the anticipated results and encourages investors to review other factors that may affect its future results and performance in iPower's Annual Report on Form 10-K, as filed with the SEC on September 14, 2023, and in its other SEC filings.

 

Investor Relations Contact:

Sean Mansouri, CFA

Elevate IR

(720) 330-2829

IPW@elevate-ir.com

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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iPower Inc. and Subsidiaries

Consolidated Balance Sheets

As of June 30, 2023 and 2022

 

 

   June 30,   June 30, 
   2023   2022 
         
ASSETS        
Current assets          
Cash and cash equivalent  $3,735,642   $1,821,947 
Accounts receivable, net   14,071,543    17,432,287 
Inventories, net   20,593,889    30,433,766 
Other receivable - related party   –    51,762 
Prepayments and other current assets   2,858,196    5,444,463 
Total current assets   41,259,270    55,184,225 
           
Non-current assets          
Right of use - non-current   7,837,345    10,453,282 
Property and equipment, net   536,418    544,633 
Deferred tax assets   2,155,250    – 
Non-current prepayments   531,456    925,624 
Goodwill   3,034,110    6,094,144 
Investment in joint venture   33,113    43,385 
Intangible assets, net   4,280,071    4,929,442 
Other non-current assets   427,254    406,732 
Total non-current assets   18,835,017    23,397,242 
           
Total assets  $60,094,287   $78,581,467 
           
LIABILITIES AND EQUITY          
Current liabilities          
Accounts payable   13,244,957    9,533,408 
Credit cards payable   366,781    807,687 
Customer deposit   350,595    273,457 
Other payables and accrued liabilities   4,831,067    5,915,220 
Advance from shareholders   85,200    92,246 
Investment payable   –    1,500,000 
Lease liability - current   2,159,173    2,582,933 
Long-term promissory note payable - current portion   2,017,852    1,879,065 
Income taxes payable   276,683    299,563 
Total current liabilities   23,332,308    22,883,579 
           
Non-current liabilities          
Long-term revolving loan payable, net   9,791,191    12,314,627 
Long-term promissory note payable, net   –    1,781,705 
Deferred tax liabilities   –    939,115 
Lease liability - non-current   6,106,047    8,265,611 
           
Total non-current liabilities   15,897,238    23,301,058 
           
Total liabilities   39,229,546    46,184,637 
           
Commitments and contingency   –    – 
           
Stockholders' Equity          
Preferred stock, $0.001 par value; 20,000,000 shares authorized; 0 shares issued and outstanding at June 30, 2023 and 2022  
 		  
 		  
–		  
 		  
 		  
 		  
–		  
 
Common stock, $0.001 par value; 180,000,000 shares authorized; 29,710,939 and 29,572,382 shares issued and outstanding at June 30, 2023 and 2022  
 		  
 		  
29,712		  
 		  
 		  
 		  
29,573		  
 
Additional paid in capital   29,624,520    29,111,863 
(Accumulated deficits) Retained earnings   (8,702,442)   3,262,948 
Non-controlling interest   (24,915)   (13,232)
Accumulated other comprehensive income (loss)   (62,134)   5,678 
Total equity   20,864,741    32,396,830 
           
Total liabilities and equity  $60,094,287   $78,581,467 

 

 

 

 

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iPower Inc. and Subsidiaries

Consolidated Statements of Operations

For the Years Ended June 30, 2023 and 2022

 

 

   For the Three Months Ended June 30,   For the Years Ended June 30, 
   2023   2022   2023   2022 
   (Unaudited)   (Unaudited)         
                 
REVENUES  $23,399,166   $22,117,831   $88,902,048   $79,418,473 
                     
TOTAL REVENUES   23,399,166    22,117,831    88,902,048    79,418,473 
                     
COST OF REVENUES   14,348,668    12,998,903    54,104,587    46,218,580 
                     
GROSS PROFIT   9,050,498    9,118,928    34,797,461    33,199,893 
                     
OPERATING EXPENSES:                    
Selling and fulfillment   8,133,299    6,842,363    32,427,972    19,180,390 
General and administrative   3,913,672    3,767,117    12,792,998    11,707,466 
Impairment loss - goodwill   –    –    3,060,034#   – 
Total operating expenses   12,046,971    10,609,480    48,281,004    30,887,856 
                     
(LOSS) INCOME FROM OPERATIONS   (2,996,473)   (1,490,552)   (13,483,543)   2,312,037 
                     
OTHER INCOME (EXPENSE)                    
Interest expenses   (265,497)   (231,017)   (1,066,280)   (458,159)
Other financing expenses   –    –    –    (80,010)
Loss on equity method investment   (1,376)   5,673    (10,001)   (6,616)
Other non-operating income   (306,874)   210,893    (107,749)   296,366 
Total other expenses, net   (573,747)   (14,451)   (1,184,030)   (248,419)
                     
(LOSS) INCOME  BEFORE INCOME TAXES   (3,570,220)   (1,505,003)   (14,667,573)   2,063,618 
                     
PROVISION FOR INCOME TAX (BENEFIT) EXPENSE   (605,374)   (146,570)   (2,690,500)   558,975 
NET  (LOSS) INCOME   (2,964,846)   (1,358,433)   (11,977,073)   1,504,643 
                     
Non-controlling interest   (2,805)   (9,162)   (11,683)   (13,232)
                     
NET (LOSS) INCOME ATTRIBUTABLE TO IPOWER INC.  $(2,962,041)  $(1,349,271)  $(11,965,390)  $1,517,875 
                     
OTHER COMPREHENSIVE LOSS                    
Foreign currency translation adjustments   (21,090)   8,904    (67,812)   5,678 
                     
COMPREHENSIVE (LOSS) INCOME ATTRIBUTABLE TO IPOWER INC.  $(2,983,131)  $(1,340,367)  $(12,033,202)  $1,523,553 
                     
WEIGHTED AVERAGE NUMBER OF COMMON STOCK                    
Basic   29,747,497    29,662,448    29,713,354    27,781,493 
                     
Diluted   29,747,497    29,662,448    29,713,354    27,781,493 
                     
(LOSSES) EARNINGS  PER SHARE                    
Basic  $(0.100)  $(0.045)  $(0.403)  $0.055 
                     
Diluted  $(0.100)  $(0.045)  $(0.403)  $0.055 

 

 

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The following information was filed by Ipower Inc. (IPW) on Thursday, September 14, 2023 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Ipower Inc.'s 10-K Annual Report:

Financial Statements, Disclosures and Schedules

Inside this 10-K Annual Report

Cover
Consolidated Balance Sheets
Consolidated Balance Sheets (Parenthetical)
Consolidated Statements Of Cash Flows
Consolidated Statements Of Changes In Stockholders' Equity
Consolidated Statements Of Operations
Accounts Receivable (Details - Credit Losses)
Accounts Receivable, Net
Accounts Receivable, Net (Details)
Accounts Receivable, Net (Tables)
Acquisition Of Anivia Limited And Subsidiaries And Variable Interest Entity
Acquisition Of Anivia Limited And Subsidiaries And Variable Interest Entity (Details - Acquisition Allocation)
Acquisition Of Anivia Limited And Subsidiaries And Variable Interest Entity (Details - Proforma Information)
Acquisition Of Anivia Limited And Subsidiaries And Variable Interest Entity (Details Narrative)
Acquisition Of Anivia Limited And Subsidiaries And Variable Interest Entity (Tables)
Basis Of Presentation And Summary Of Significant Accounting Policies
Basis Of Presentation And Summary Of Significant Accounting Policies (Details - Assumptions)
Basis Of Presentation And Summary Of Significant Accounting Policies (Details - Fair Values Of Financial Instruments)
Basis Of Presentation And Summary Of Significant Accounting Policies (Details - Useful Lives)
Basis Of Presentation And Summary Of Significant Accounting Policies (Details Narrative)
Basis Of Presentation And Summary Of Significant Accounting Policies (Policies)
Basis Of Presentation And Summary Of Significant Accounting Policies (Tables)
Commitments And Contingencies
Commitments And Contingencies (Details - Balance Sheet)
Commitments And Contingencies (Details - Lease Cost)
Commitments And Contingencies (Details - Lease Maturity)
Commitments And Contingencies (Details Narrative)
Commitments And Contingencies (Tables)
Concentration Of Risk
Concentration Of Risk (Details Narrative)
Earnings Per Share
Earnings Per Share (Details Narrative)
Earnings Per Share (Details)
Earnings Per Share (Tables)
Equity
Equity (Details Narrative)
Equity (Details)
Equity (Tables)
Income Taxes
Income Taxes (Details - Deferred Taxes)
Income Taxes (Details - Reconcilation Of Effective Income Tax Rate)
Income Taxes (Details Narrative)
Income Taxes (Details)
Income Taxes (Tables)
Intangible Assets, Net
Intangible Assets, Net (Details - Future Amortization)
Intangible Assets, Net (Details - Schedule Of Intangible Assets)
Intangible Assets, Net (Details Narrative)
Intangible Assets, Net (Tables)
Inventories, Net
Inventories, Net (Details Narrative)
Joint Ventures
Joint Ventures (Details Narrative)
Loans Payable
Loans Payable (Details - Interest Expense)
Loans Payable (Details Narrative)
Loans Payable (Tables)
Nature Of Business And Organization
Non-Current Prepayments
Non-Current Prepayments (Details Narrative)
Other Payables And Accrued Liabilities
Other Payables And Accrued Liabilities (Details Narrative)
Other Payables And Accrued Liabilities (Details)
Other Payables And Accrued Liabilities (Tables)
Prepayments And Other Current Assets (Details - Credit Losses)
Prepayments And Other Current Assets (Details)
Prepayments And Other Current Assets, Net
Prepayments And Other Current Assets, Net (Details Narrative)
Prepayments And Other Current Assets, Net (Tables)
Related Party Transactions
Related Party Transactions (Details Narrative)
Subsequent Events
Variable Interest Entity
Variable Interest Entity (Details - Assets And Liabilities)
Variable Interest Entity (Details - Vie Operations)
Variable Interest Entity (Details Narrative)
Variable Interest Entity (Tables)
Warrant Liabilities
Warrant Liabilities (Details Narrative)

Material Contracts, Statements, Certifications & more

Ipower Inc. provided additional information to their SEC Filing as exhibits

Exhibit 23.1: Consent Of Independent Registered Public Accounting Firm
Exhibit 31.1: Certification
Exhibit 31.2: Certification
Exhibit 32.1: Certification
Exhibit 32.2: Certification
Ticker: IPW
CIK: 1830072
Form Type: 10-K Annual Report
Accession Number: 0001683168-23-006454
Submitted to the SEC: Thu Sep 14 2023 5:48:00 PM EST
Accepted by the SEC: Fri Sep 15 2023
Period: Friday, June 30, 2023
Industry: Retail Building Materials Hardware Garden Supply

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