Leatt Corp Announces Results for the Second Quarter 2024
Second Quarter 2024 Summary
- Revenues for the second quarter were
$10.08 million , down 18%, compared to the second quarter of 2023. - Cash flows provided by operations were
$2.99 million for the six months endedJune 30, 2024 . - Income (loss) from operations for the second quarter was
$(1.13) million , down 186%, compared to the second quarter of 2023. - Cash and cash equivalents increased 17% to
$13.33 million for the six months endedJune 30, 2024 . - Successful launch of new product category, a portfolio of bicycle components including handlebars, grips, and ultra-light stems and pedals, at Eurobike Tradeshow.
Chief Executive Officer
"Total global revenues for the second quarter of 2024 were
"At a product level, declines in helmet sales and our other products, parts, and accessory category during the second quarter were partially offset by increases in body armor sales and neck braces. It was particularly encouraging to see neck brace, body and limb protection, knee brace, and MTB apparel returning to growth on a global basis. We also continued to ship promising ADV apparel orders during the quarter and look forward to delivering a pipeline of innovative product categories to the growing ADV market over the next several quarters.
"Cash increased by
"On a year-to-date basis, despite a decrease in revenues and an increase in costs, we generated cash flows from operating activities of
"Our inventory levels continue to stabilize and have decreased by
Financial Summary
Total revenues for the second quarter of 2024 were
Income (loss) from operations for the second quarter of 2024 was
Net income (loss) for the second quarter of 2024 was
Leatt continued to meet its working capital needs from cash on hand and internally generated cash flow from operations. At
Founder and Chairman Dr.
Business Outlook
"We continue to invest heavily in consumer brand recognition and building out a high-performing team of sales and marketing professionals around the world as industry-wide turbulence presents an opportunity to grow the Leatt family by adding talented team members. Although these investments typically take time to add to our financial results, we believe that investing in brand momentum and building a great team remain cornerstones of our future growth plans.
"We look forward in the coming months to what we believe will be successful global launches of our 2025 product lines for MOTO, MTB, and ADV as our team of developers and engineers continue to strive for product excellence. We expect that the 2025 MTB lineup will include an exciting new category—top-level, innovative bicycle components.
"We are all enthusiastic about the future with our strong portfolio of innovative products in the market and in the pipeline, a multi-channel sales organization that is growing and developing, and a robust balance sheet to fuel brand and revenue growth. We remain confident we are well-positioned for future growth and shareholder value."
Conference Call
The Company will host a conference call at
Participants should dial into the call ten minutes before the scheduled time, using the following numbers: 1-877-407-9716 (
Audio Webcast
There will also be a simultaneous live webcast through the Company's website, www.leatt-corp.com. Participants should register on the website approximately ten minutes prior to the start of the webcast.
Replay
An audio replay of the conference call will be available for seven days and can be accessed by dialing 1-844-512-2921 (
For those unable to attend the call, a recording of the live webcast will be archived shortly following the event for 30 days on the Company's website.
About
Driven by the science of thrill,
For more information, visit www.leatt.com.
Follow Leatt® on Facebook, Twitter, and Instagram.
Forward-looking Statements
This
press release may contain forward-looking statements regarding
[FINANCIAL TABLES TO FOLLOW]
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CONSOLIDATED BALANCE SHEETS |
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ASSETS |
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Unaudited |
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Audited |
Current Assets |
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Cash and cash equivalents |
$ 13,329,948 |
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$ 11,347,420 |
Accounts receivable, net |
5,733,601 |
|
6,970,322 |
Inventory, net |
14,738,542 |
|
20,391,873 |
Payments in advance |
1,168,433 |
|
664,754 |
Deferred asset, net |
9,601 |
|
9,601 |
Income tax refunds receivable |
521,088 |
|
623,081 |
Prepaid expenses and other current assets |
2,592,893 |
|
2,297,934 |
Total current assets |
38,094,106 |
|
42,304,985 |
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Property and equipment, net |
3,678,621 |
|
4,026,821 |
Operating lease right-of-use assets, net |
699,260 |
|
845,209 |
Accounts receivable, net |
244,383 |
|
309,947 |
Deferred tax asset, net |
84,200 |
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84,200 |
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Other Assets |
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Deposits |
37,527 |
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36,210 |
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Total Assets |
$ 42,838,097 |
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$ 47,607,372 |
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LIABILITIES AND STOCKHOLDERS' EQUITY |
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Current Liabilities |
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Accounts payable and accrued expenses |
$ 3,217,573 |
|
$ 5,202,368 |
Notes payable, current |
72,025 |
|
112,858 |
Operating lease liabilities, current |
282,581 |
|
299,432 |
Short term loans, net of finance charges |
400,398 |
|
1,135,761 |
Total current liabilities |
3,972,577 |
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6,750,419 |
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Notes payable, net of current portion |
15,595 |
|
30,652 |
Operating lease liabilities, net of current portion |
416,679 |
|
545,777 |
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Commitments and contingencies |
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Preferred stock, |
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authorized, 120,000 shares issued and outstanding |
3,000 |
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3,000 |
Common stock, |
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authorized, 6,215,440 and 6,215,440 shares issued |
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and outstanding |
130,553 |
|
130,553 |
Additional paid - in capital |
10,749,136 |
|
10,745,384 |
Accumulated other comprehensive loss |
(1,375,246) |
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(1,398,258) |
Retained earnings |
28,925,803 |
|
30,799,845 |
Total stockholders' equity |
38,433,246 |
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40,280,524 |
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Total Liabilities and Stockholders' Equity |
$ 42,838,097 |
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$ 47,607,372 |
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The accompanying notes are an integral part of these consolidated financial statements. |
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CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) |
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Three Months Ended |
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Six Months Ended |
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2024 |
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2023 |
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2024 |
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2023 |
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Unaudited |
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Unaudited |
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Unaudited |
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Unaudited |
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Revenues |
$ 10,078,695 |
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$ 12,350,224 |
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$ 20,693,165 |
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$ 25,429,567 |
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Cost of Revenues |
6,157,282 |
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7,007,442 |
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12,763,419 |
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14,314,015 |
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Gross Profit |
3,921,413 |
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5,342,782 |
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7,929,746 |
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11,115,552 |
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Product Royalty Income |
92,780 |
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10,248 |
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132,083 |
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23,384 |
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Operating Expenses |
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Salaries and wages |
1,608,372 |
|
1,228,491 |
|
3,176,643 |
|
2,469,927 |
Commissions and consulting expenses |
165,601 |
|
110,925 |
|
289,817 |
|
207,249 |
Professional fees |
120,617 |
|
111,785 |
|
419,588 |
|
449,028 |
Advertising and marketing |
1,183,282 |
|
863,378 |
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2,075,699 |
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1,704,472 |
Office lease and expenses |
163,190 |
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161,572 |
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314,744 |
|
311,812 |
Research and development costs |
628,793 |
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632,968 |
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1,184,571 |
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1,217,959 |
Bad debt expense (recovery) |
314 |
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(230,616) |
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10,278 |
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(181,221) |
General and administrative expenses |
977,160 |
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868,595 |
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1,920,048 |
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1,686,774 |
Depreciation |
297,250 |
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292,374 |
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591,384 |
|
572,184 |
Total operating expenses |
5,144,579 |
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4,039,472 |
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9,982,772 |
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8,438,184 |
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Income (Loss) from Operations |
(1,130,386) |
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1,313,558 |
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(1,920,943) |
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2,700,752 |
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Other Income (Expenses) |
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Interest and other expenses, net |
98,016 |
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(16,874) |
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73,533 |
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(37,798) |
Total other Income (expenses) |
98,016 |
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(16,874) |
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73,533 |
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(37,798) |
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Income (Loss) Before Income Taxes |
(1,032,370) |
|
1,296,684 |
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(1,847,410) |
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2,662,954 |
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Income Taxes |
24,993 |
|
520,545 |
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26,632 |
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863,594 |
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Net Income (Loss) Available to Common Shareholders |
$ (1,057,363) |
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$ 776,139 |
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$ (1,874,042) |
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$ 1,799,360 |
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Net Income (Loss) per Common Share |
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Basic |
$ (0.17) |
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$ 0.13 |
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$ (0.30) |
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$ 0.30 |
Diluted |
$ (0.16) |
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$ 0.12 |
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$ (0.29) |
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$ 0.29 |
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Weighted Average Number of Common Shares Outstanding |
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Basic |
6,215,440 |
|
5,971,340 |
|
6,215,440 |
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5,971,340 |
Diluted |
6,490,828 |
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6,268,520 |
|
6,490,828 |
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6,268,520 |
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Comprehensive Income (Loss) |
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Net Income (Loss) |
$ (1,057,363) |
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$ 776,139 |
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$ (1,874,042) |
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$ 1,799,360 |
Other comprehensive income (loss) , net of |
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taxes in 2024 and 2023 |
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Foreign currency translation |
160,564 |
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(163,320) |
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23,012 |
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(437,069) |
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Total Comprehensive Income (Loss) |
$ (896,799) |
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$ 612,819 |
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$ (1,851,030) |
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$ 1,362,291 |
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The accompanying notes are an integral part of these consolidated financial statements. |
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CONSOLIDATED STATEMENTS OF CASH FLOWS |
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FOR THE SIX MONTHS ENDED |
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2024 |
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2023 |
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Cash flows from operating activities |
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Net income (loss) |
$ (1,874,042) |
|
$ 1,799,360 |
Adjustments to reconcile net income (loss) to net cash provided by |
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operating activities: |
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Depreciation |
591,384 |
|
572,184 |
Stock-based compensation |
3,752 |
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- |
Bad debts reserve |
1,559 |
|
(202,905) |
Inventory reserve |
(28,390) |
|
180,164 |
Deferred asset allowance |
- |
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(37,518) |
Loss on sale of property and equipment |
- |
|
12 |
(Increase) decrease in: |
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Accounts receivable |
1,235,162 |
|
2,692,726 |
Deferred asset |
- |
|
762,012 |
Inventory |
5,681,721 |
|
3,466,369 |
Payments in advance |
(503,679) |
|
5,079 |
Prepaid expenses and other current assets |
(294,959) |
|
865,006 |
Income tax refunds receivable |
101,993 |
|
- |
Long-term accounts receivable |
65,564 |
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- |
Deposits |
(1,317) |
|
924 |
Increase (decrease) in: |
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Accounts payable and accrued expenses |
(1,984,795) |
|
(858,760) |
Income taxes payable |
- |
|
(2,026,505) |
Deferred compensation |
- |
|
(400,000) |
Net cash provided by operating activities |
2,993,953 |
|
6,818,148 |
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Cash flows from investing activities |
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Capital expenditures |
(239,094) |
|
(265,819) |
Net cash used in investing activities |
(239,094) |
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(265,819) |
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Cash flows from financing activities |
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Repayment of notes payable to bank |
(55,890) |
|
(52,141) |
Repayment of short-term loans, net |
(735,363) |
|
(738,228) |
Net cash used in financing activities |
(791,253) |
|
(790,369) |
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Effect of exchange rates on cash and cash equivalents |
18,922 |
|
(867,308) |
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Net increase in cash and cash equivalents |
1,982,528 |
|
4,894,652 |
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Cash and cash equivalents - beginning of period |
11,347,420 |
|
7,102,945 |
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Cash and cash equivalents - end of period |
$ 13,329,948 |
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$ 11,997,597 |
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SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: |
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Cash paid for interest |
$ 42,210 |
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$ 42,127 |
Cash paid for income taxes |
$ 26,633 |
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$ 2,846,403 |
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Other noncash investing and financing activities |
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Common stock issued for services |
$ 3,752 |
|
$ - |
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The accompanying notes are an integral part of these consolidated financial statements. |
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