Q3 revenue rises to $106 million, an increase of 45% year-over-year, with service revenue
representing 77% of total revenue
Adjusted EBITDA climbs to $22 million, an increase of 77%, driving an annual run rate
surpassing $85 million- doubling 2024 adjusted EBITDA
FY25 full year guidance increased $10 million for revenue and $2.5 million for adjusted
EBITDA
Meaningful increase in adjusted gross margin performance, with total adjusted gross
margins now above 60%, and adjusted service gross margins approaching 70%
Post-M&A integration ahead of schedule, priming for double digit growth trajectory in FY26
WOODCLIFF LAKE, N.J., Feb. 10, 2025 /PRNewswire/ -- Powerfleet, Inc. (Nasdaq: AIOT) reported its financial results for the third quarter ended December 31, 2024. This marks the first full quarter following the closing of the acquisition of Fleet Complete and the third full quarter since closing the business combination with MiX Telematics Ltd (MiX). Prior year comparison numbers are adjusted to reflect the pro-forma financial performance of the business combination with MiX.
THIRD QUARTER 2025 FINANCIAL HIGHLIGHTS
- Total revenue: Increased by 45% to $106.4 million.
- Service revenue: Accounted for 77% of total revenue, increasing 45% to $81.7 million, driven by the Fleet Complete acquisition and Unity's safety-focused solutions.
- Product revenue: Grew 42% to $24.7 million, driven by the Fleet Complete acquisition and in-warehouse product strength.
- Gross profit: Increased by 44% to $58.8 million. Gross profit, adjusted for the amortization of acquisition-related intangibles, increased by $23.3 million, or 57%, to $64.2 million.
- Combined adjusted gross margin: Exceeded 60%, an increase from 55.5% in the prior year, with adjusted service margins expanding by 4.4% to 69.3% and product margins improving by 5.3% to 30.6%.
- Adjusted EBITDA: Increased 77% to $22.5 million, up from $12.7 million in the prior year, driven by the Fleet Complete acquisition, organic growth, and cost synergies.
- Exits the quarter with over 2.6 million recurring revenue subscribers actively leveraging the company's comprehensive suite of solutions
MANAGEMENT COMMENTARY
"Our strategic focus on achieving global scale through accretive M&A transactions has fundamentally reshaped our business. With the rapid follow-up of the Fleet Complete acquisition after the MiX combination, we have built a scaled P&L that sets the stage for long-term growth," said CEO Steve Towe.
"With these strong financial foundations in place, our primary focus is now on seamlessly integrating the combined businesses, executing our strategic priorities, and positioning Powerfleet for accelerated top-line growth."
"The process of integration is well underway, as we align our organizational structure to drive sustainable growth and enhance operational excellence. Simultaneously, our cost synergy program remains on track, with $15 million in annualized savings secured exiting the December quarter and more than $16 million targeted by fiscal year-end."
"On the commercial front, the Fleet Complete acquisition has significantly expanded our market opportunity through scaled channel partnerships with leading telecommunications providers. Our direct sales efforts continue to drive high-value wins, including a major Unity in-warehouse safety solution deal with one of the largest beverage companies in North America, with long-term total contract value revenue potential in the $25 million to $30 million range. Meanwhile, AI camera solutions continue to gain strong traction, with sales volumes up 52% year-over-year through our largest channel partner."
THIRD QUARTER 2025 FINANCIAL RESULTS
Total revenue increased 45% year-over-year to $106.4 million, driven by the Fleet Complete acquisition and strong in-warehouse product sales, which helped offset headwinds in the U.S. logistics segment. Product revenue grew 42% to $24.7 million, while service revenue rose 45% to $81.7 million, fueled by the Fleet Complete acquisition and Unity's safety-centric solutions.
Gross profit increased by 44% to $58.8 million. Gross profit, adjusted for the amortization of acquisition-related intangibles, increased by $23.3 million, or 57%, to $64.2 million. Gross margin saw significant expansion, with product gross margin improving to 30.6%, up from 25.3% in the prior year. Service gross margin, adjusted for $5.4 million in non-cash amortization, increased by 4.4% to 69.3%. As a result, the combined adjusted gross margin surpassed 60%, up from 55.5% in the prior year.
Operating expenses totaled $60.0 million, including $6.7 million in one-time transaction and restructuring costs, compared to $5.0 million in the prior year. Excluding these costs, adjusted operating expenses were $53.4 million, up from $37.4 million, with the increase solely attributable to the Fleet Complete acquisition.
Adjusted EBITDA increased 77% to $22.5 million, up from $12.7 million in the prior year, reflecting contributions from the Fleet Complete acquisition, organic growth, and cost synergies. Net loss attributable to common stockholders was $0.11 per share, compared to $0.05 per share in the prior year, reflecting higher transaction costs, interest expense and taxes. After adjusting for one-time expenses and amortization of acquisition-related intangibles, adjusted net income was $0.01 per share, down from $0.03 per share in the prior year. The $0.02 decline was fully accounted for by a $0.07 per share increase in interest expense and taxes.
Net debt exiting the quarter was $229.7 million, consisting of $38.6 million in cash and $268.3 million in total debt. Net debt was below year-end guidance of $235 million, benefiting from the delayed settlement of transaction costs.
FULL-YEAR 2025 FINANCIAL OUTLOOK
We are raising our full-year 2025 guidance to reflect the strength of our year-to-date financial performance and the accounting impact of Fleet Complete's conversion from Canadian accounting standards to U.S. GAAP.
- Annual revenue is now expected to exceed $362.5 million, a $10 million increase from our prior guidance of approximately $352.5 million.
- Adjusted EBITDA is now expected to exceed $75 million, a $2.5 million increase from our prior guidance of $72.5 million, with both figures inclusive of $5 million in secured annualized run-rate synergies.
INVESTOR CONFERENCE CALL
As previously announced, Powerfleet will hold a conference call on Monday, February 10, 2025, at 8:30 a.m. Eastern time (5:30 a.m. Pacific time) to discuss results for the third quarter fiscal 2025 ended December 31, 2024.
Management will make prepared remarks followed by a question-and-answer session.
Date: Monday, February 10, 2025
Time: 8:30 a.m. Eastern time (5:30 a.m. Pacific time)
Toll Free: 888-506-0062
International: 973-528-0011
Participant Access Code: 466496
The conference call will be broadcast simultaneously and available for replay here and via the investor section of Powerfleet's website at ir.powerfleet.com.
NON-GAAP FINANCIAL MEASURES
To supplement its financial statements presented in accordance with Generally Accepted Accounting Principles (GAAP), Powerfleet provides certain non-GAAP measures of financial performance. These non-GAAP measures include adjusted EBITDA, adjusted gross margin, adjusted gross profit, adjusted service margin, adjusted operating expenses, adjusted net income per share and net debt. Reference to these non-GAAP measures should be considered in addition to results prepared under current accounting standards, but are not a substitute for, or superior to, GAAP results. These non-GAAP measures are provided to enhance investors' overall understanding of Powerfleet's current financial performance. Specifically, Powerfleet believes the non-GAAP measures provide useful information to both management and investors by excluding certain expenses, gains and losses and fluctuations in currency rates that may not be indicative of its core operating results and business outlook. These non-GAAP measures are not measures of financial performance or liquidity under GAAP and, accordingly, should not be considered as an alternative to net income, gross margin, gross profit, cash flow from operating activities or earnings per share as an indicator of operating performance or liquidity. Because Powerfleet's method for calculating the non-GAAP measures may differ from other companies' methods, the non-GAAP measures may not be comparable to similarly titled measures reported by other companies. Reconciliation of all non-GAAP measures included in this press release to the most directly comparable GAAP measures can be found in the financial tables included in this press release.
ABOUT POWERFLEET
Powerfleet (Nasdaq: AIOT; JSE: PWR) is a global leader in the artificial intelligence of things (AIoT) software-as-a-service (SaaS) mobile asset industry. With more than 30 years of experience, Powerfleet unifies business operations through the ingestion, harmonization, and integration of data, irrespective of source, and delivers actionable insights to help companies save lives, time, and money. Powerfleet's ethos transcends our data ecosystem and commitment to innovation; our people-centric approach empowers our customers to realize impactful and sustained business improvement. The company is headquartered in New Jersey, United States, with offices around the globe. Explore more at www.powerfleet.com. Powerfleet has a primary listing on The Nasdaq Global Market and a secondary listing on the Main Board of the Johannesburg Stock Exchange (JSE).
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements within the meaning of federal securities laws. Powerfleet's actual results may differ from its expectations, estimates and projections and consequently, you should not rely on these forward-looking statements as predictions of future events. Forward-looking statements may be identified by words such as "expect," "estimate," "project," "budget," "forecast," "anticipate," "intend," "plan," "may," "will," "could," "should," "believes," "predicts," "potential," "continue," and similar expressions.
These forward-looking statements include, without limitation, our expectations with respect to our beliefs, plans, goals, objectives, expectations, anticipations, assumptions, estimates, intentions and future performance, as well as anticipated financial impacts of our transactions with MiX Telematics and Fleet Complete. Forward-looking statements involve significant known and unknown risks, uncertainties and other factors, which may cause our actual results, performance or achievements to be materially different from the future results, performance or achievements expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be forward-looking statements. Most of these factors are outside our control and are difficult to predict. The risks and uncertainties referred to above include, but are not limited to, risks related to: (i) future economic and business conditions; (ii) integration of our, MiX Telematics' and Fleet Complete's businesses and the ability to recognize the anticipated synergies and benefits of the transactions with MiX Telematics and Fleet Complete; (iii) the loss of any of our key customers or reduction in the purchase of our products by any such customers; (iv) the failure of the markets for our products to continue to develop; (v) the negative effects of the transactions on the market price of our securities; (vi) our inability to adequately protect our intellectual property; (vii) our inability to manage growth; (viii) the effects of competition from a wide variety of local, regional, national and other providers of wireless solutions; and (ix) such other factors as are set forth in the periodic reports filed by us with the Securities and Exchange Commission (SEC), including but not limited to those described under the heading "Risk Factors" in our annual reports on Form 10-K, quarterly reports on Form 10-Q and any other filings made with the SEC from time to time, which are available via the SEC's website at http://www.sec.gov. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove to be incorrect, actual results may vary materially from those indicated or anticipated by these forward-looking statements. Therefore, you should not rely on any of these forward-looking statements.
The forward-looking statements included in this press release are made only as of the date of this press release, and except as otherwise required by applicable securities law, we assume no obligation, nor do we intend to publicly update or revise any forward-looking statements to reflect subsequent events or circumstances.
Powerfleet Investor Contacts
Carolyn Capaccio and Jody Burfening
Alliance Advisors IR
[email protected]
Powerfleet Media Contact
Jonathan Bates
[email protected]
+44 121 717-5360
POWERFLEET, INC. AND SUBSIDIARIES | |||||||
Three Months Ended December 31, | Nine Months Ended December 31, | ||||||
2023 | 2024 | 2023 | 2024 | ||||
Pro Forma | Consolidated | Pro Forma | Consolidated | ||||
Revenues: | |||||||
Products | $ 17,402 | $ 24,687 | $ 49,872 | $ 63,718 | |||
Services | 56,233 | 81,742 | 164,210 | 195,159 | |||
Total revenues | 73,635 | 106,429 | 214,082 | 258,877 | |||
Cost of revenues: | |||||||
Cost of products | 12,996 | 17,129 | 35,381 | 43,809 | |||
Cost of services | 19,762 | 30,517 | 58,312 | 75,294 | |||
Total cost of revenues | 32,758 | 47,646 | 93,693 | 119,103 | |||
Gross profit | 40,877 | 58,783 | 120,389 | 139,774 | |||
Operating expenses: | |||||||
Selling, general and administrative | 38,957 | 55,405 | 110,473 | 147,522 | |||
Research and development expenses | 3,434 | 4,621 | 11,060 | 11,157 | |||
Total operating expenses | 42,391 | 60,026 | 121,533 | 158,679 | |||
Loss from operations | (1,514) | (1,243) | (1,144) | (18,905) | |||
Interest income | 341 | 359 | 853 | 831 | |||
Interest expense | (1,742) | (7,942) | (3,111) | (14,675) | |||
Bargain purchase - Movingdots | 1,517 | - | 1,800 | - | |||
Other income/(expense), net | 58 | (2,011) | (266) | (961) | |||
Net loss before income taxes | (1,340) | (10,837) | (1,868) | (33,710) | |||
Income tax expense | (670) | (3,513) | (5,097) | (4,821) | |||
Net loss before non-controlling interest | (2,010) | (14,350) | (6,965) | (38,531) | |||
Non-controlling interest | (32) | 1 | (38) | (17) | |||
Net loss | (2,042) | (14,349) | (7,003) | (38,548) | |||
Accretion of preferred stock | (1,878) | - | (5,484) | - | |||
Preferred stock dividend | (1,129) | - | (3,385) | (25) | |||
Net loss attributable to common | $ (5,049) | $ (14,349) | $ (15,872) | $ (38,573) | |||
Net loss per share attributable to | $ (0.05) | $ (0.11) | $ (0.15) | $ (0.33) | |||
Weighted average common shares | 106,335 | 132,189 | 106,367 | 115,650 | |||
POWERFLEET, INC. AND SUBSIDIARIES | ||||
March 31, 2024 | December 31, 2024 | |||
Pro Forma Combined | Consolidated | |||
ASSETS | ||||
Current assets: | ||||
Cash and cash equivalents | $ 51,091 | $ 33,634 | ||
Restricted cash | 86,104 | 5,011 | ||
Accounts receivables, net | 55,008 | 82,167 | ||
Inventory, net | 25,800 | 27,985 | ||
Deferred costs - current | 42 | 6 | ||
Prepaid expenses and other current assets | 17,784 | 25,455 | ||
Total current assets | 235,829 | 174,258 | ||
Fixed assets, net | 48,306 | 55,257 | ||
Goodwill | 121,713 | 374,939 | ||
Intangible assets, net | 40,444 | 263,396 | ||
Right-of-use asset | 11,222 | 12,308 | ||
Severance payable fund | 3,796 | 4,461 | ||
Deferred tax asset | 3,874 | 5,766 | ||
Other assets | 19,090 | 18,284 | ||
Total assets | $ 484,274 | $ 908,669 | ||
LIABILITIES | ||||
Current liabilities: | ||||
Short-term bank debt and current maturities of long-term debt | $ 22,109 | $ 34,596 | ||
Accounts payable and accrued expenses | 60,763 | 86,481 | ||
Deferred revenue - current | 12,236 | 17,912 | ||
Lease liability - current | 2,648 | 4,763 | ||
Total current liabilities | 97,756 | 143,752 | ||
Long-term debt - less current maturities | 113,810 | 233,750 | ||
Deferred revenue - less current portion | 4,892 | 3,949 | ||
Lease liability - less current portion | 8,773 | 8,268 | ||
Accrued severance payable | 4,597 | 4,906 | ||
Deferred tax liability | 18,669 | 52,461 | ||
Other long-term liabilities | 2,980 | 3,042 | ||
Total liabilities | 251,477 | 450,128 | ||
Convertible redeemable preferred stock: Series A | 90,273 | - | ||
STOCKHOLDERS' EQUITY | ||||
Preferred stock | - | - | ||
Common stock | 63,842 | 1,339 | ||
Additional paid-in capital | 200,218 | 669,492 | ||
Accumulated deficit | (78,516) | (193,345) | ||
Accumulated other comprehensive loss | (17,133) | (7,578) | ||
Treasury stock | (25,997) | (11,518) | ||
Total stockholders' equity | 142,414 | 458,390 | ||
Non-controlling interest | 110 | 151 | ||
Total equity | 142,524 | 458,541 | ||
Total liabilities, convertible redeemable preferred stock, and | $ 484,274 | $ 908,669 | ||
POWERFLEET, INC. AND SUBSIDIARIES | ||||
Nine Months Ended December 31, | ||||
2023 | 2024 | |||
Pro Forma | Consolidated | |||
Cash flows from operating activities | ||||
Net loss | $ (7,003) | $ (38,548) | ||
Adjustments to reconcile net loss to cash provided by/(used in) operating | ||||
Non-controlling interest | 38 | 17 | ||
Gain on bargain purchase | (1,800) | - | ||
Inventory reserve | 1,821 | 1,571 | ||
Stock based compensation expense | 3,903 | 8,438 | ||
Depreciation and amortization | 21,179 | 33,042 | ||
Right-of-use assets, non-cash lease expense | 2,156 | 4,284 | ||
Derivative mark-to-market adjustment | - | (475) | ||
Bad debts expense | 4,900 | 7,229 | ||
Deferred income taxes | 2,935 | 676 | ||
Shares issued for transaction bonuses | - | 889 | ||
Lease termination and modification losses | - | 232 | ||
Other non-cash items | 3,907 | 727 | ||
Changes in operating assets and liabilities: | ||||
Accounts receivables | (11,552) | (15,245) | ||
Inventories | (2,030) | 2,623 | ||
Prepaid expenses and other current assets | 381 | 2,062 | ||
Deferred costs | (6,323) | (5,124) | ||
Deferred revenue | (292) | 1,031 | ||
Accounts payable and accrued expenses | 6,117 | (15,655) | ||
Lease liabilities | (2,157) | (4,098) | ||
Accrued severance payable, net | (21) | (562) | ||
Net cash provided by/(used in) operating activities | 16,159 | (16,886) | ||
Cash flows from investing activities: | ||||
Acquisition, net of cash assumed | - | (137,112) | ||
Proceeds from sale of fixed assets | - | 256 | ||
Capitalized software development costs | (7,203) | (7,310) | ||
Capital expenditures | (15,140) | (16,607) | ||
Deferred consideration paid | (1,414) | - | ||
Repayment of loan advanced to external parties | - | 294 | ||
Net cash used in investing activities | (23,757) | (160,479) | ||
Cash flows from financing activities: | ||||
Repayment of long-term debt | (3,079) | (2,140) | ||
Short-term bank debt, net | 10,268 | 11,887 | ||
Purchase of treasury stock upon vesting of restricted stock | (643) | (2,836) | ||
Repayment of financing lease | (129) | - | ||
Payment of preferred stock dividend and redemption of preferred stock | (3,385) | (90,298) | ||
Proceeds from private placement, net | - | 66,459 | ||
Proceeds from long-term debt | - | 125,000 | ||
Payment of long-term debt costs | - | (1,410) | ||
Proceeds from exercise of stock options, net | 36 | 912 | ||
Cash paid on dividends to affiliates | (4,002) | (6) | ||
Net cash (used in)/provided by financing activities | (934) | 107,568 | ||
Effect of foreign exchange rate changes on cash and cash equivalents | (1,600) | (1,222) | ||
Net decrease in cash and cash equivalents, and restricted cash | (10,132) | (71,019) | ||
Cash and cash equivalents, and restricted cash at beginning of the period | 55,746 | 109,664 | ||
Cash and cash equivalents, and restricted cash at end of the period | $ 45,614 | $ 38,645 | ||
Reconciliation of cash, cash equivalents, and restricted cash, beginning | ||||
Cash and cash equivalents | 54,656 | 24,354 | ||
Restricted cash | 1,090 | 85,310 | ||
Cash, cash equivalents, and restricted cash, beginning of the period | $ 55,746 | $ 109,664 | ||
Reconciliation of cash, cash equivalents, and restricted cash, end of the | ||||
Cash and cash equivalents | 44,441 | 33,634 | ||
Restricted cash | 1,173 | 5,011 | ||
Cash, cash equivalents, and restricted cash, end of the period | $ 45,614 | $ 38,645 | ||
Supplemental disclosure of cash flow information: | ||||
Cash paid for: | ||||
Taxes | $ 1,757 | $ 1,052 | ||
Interest | $ 1,828 | $ 11,517 | ||
Noncash investing and financing activities: | ||||
Common stock issued for transaction bonus | $ - | $ 9 | ||
Shares issued in connection with MiX Combination | $ - | $ 362,005 | ||
Shares issued in connection with Fleet Complete acquisition | $ - | $ 21,343 | ||
Value of licensed intellectual property acquired in connection with | $ 1,517 | $ - | ||
Preferred stock dividends paid in shares | $ 1,108 | $ - | ||
POWERFLEET, INC. AND SUBSIDIARIES | |||||||
RECONCILIATION OF GAAP TO ADJUSTED EBITDA FINANCIAL MEASURES | |||||||
(In thousands) | |||||||
Three Months Ended December 31, | Nine Months Ended December 31, | ||||||
2023 | 2024 | 2023 | 2024 | ||||
Pro Forma | Consolidated | Pro Forma | Consolidated | ||||
Net loss attributable to common stockholders | $ (5,049) | $ (14,349) | $ (15,872) | $ (38,573) | |||
Non-controlling interest | 32 | (1) | 38 | 17 | |||
Preferred stock dividend and accretion | 3,007 | - | 8,870 | 25 | |||
Interest expense, net | 1,095 | 7,583 | 2,257 | 13,844 | |||
Other expense, net | 8 | - | 32 | - | |||
Income tax expense | 670 | 3,513 | 5,097 | 4,821 | |||
Depreciation and amortization | 7,602 | 13,643 | 21,179 | 33,042 | |||
Stock-based compensation | 1,385 | 1,138 | 3,903 | 8,438 | |||
Foreign currency losses | 637 | 543 | 1,055 | 1,288 | |||
Restructuring-related expenses | 144 | 841 | 741 | 3,108 | |||
Gain on bargain purchase - Movingdots | (1,517) | - | (1,800) | - | |||
Derivative mark-to-market adjustment | - | 1,722 | - | (475) | |||
Recognition of pre-October 1, 2024 | - | 2,041 | - | 2,041 | |||
Net profit on fixed assets | (45) | - | (49) | - | |||
Contingent consideration remeasurement | (511) | - | (1,049) | - | |||
Acquisition-related expenses | 4,885 | 5,301 | 7,136 | 20,872 | |||
Integration-related expenses | - | 520 | - | 2,259 | |||
Non-recurring transitional service | 361 | - | 482 | - | |||
Adjusted EBITDA | $ 12,704 | $ 22,495 | $ 32,020 | $ 50,707 | |||
POWERFLEET, INC. AND SUBSIDIARIES | |||||||
RECONCILIATION OF GAAP TO NON-GAAP NET INCOME FINANCIAL MEASURES | |||||||
(In thousands) | |||||||
Three Months Ended December 31, | Nine Months Ended December 31, | ||||||
2023 | 2024 | 2023 | 2024 | ||||
Pro Forma | Consolidated | Pro Forma | Consolidated | ||||
Net loss | $ (2,042) | $ (14,349) | $ (7,003) | $ (38,548) | |||
Incremental intangible assets amortization | - | 5,393 | - | 9,551 | |||
Stock-based compensation (non- | - | - | - | 4,693 | |||
Foreign currency losses | 637 | 543 | 1,055 | 1,288 | |||
Income tax effect of net foreign exchange | (644) | 1,631 | (110) | (225) | |||
Restructuring-related expenses | 144 | 841 | 741 | 3,108 | |||
Income tax effect of restructuring costs | - | (30) | (7) | (154) | |||
Derivative mark-to-market adjustment | - | 1,722 | - | (475) | |||
Acquisition-related expenses | 4,885 | 5,301 | 7,136 | 20,872 | |||
Integration-related expenses | - | 520 | - | 2,259 | |||
Non-recurring transitional service | 361 | - | 482 | - | |||
Contingent consideration remeasurement | (511) | - | (1,049) | - | |||
Income tax effect of contingent | - | - | - | - | |||
Non-GAAP net income | $ 2,830 | $ 1,572 | $ 1,245 | $ 2,369 | |||
Weighted average shares outstanding | 106,335 | 132,189 | 106,367 | 115,650 | |||
Non-GAAP net income per share - basic | $ 0.03 | $ 0.01 | $ 0.01 | $ 0.02 | |||
POWERFLEET, INC. AND SUBSIDIARIES | |||||||
ADJUSTED GROSS PROFIT MARGINS | |||||||
(In thousands) | |||||||
Three Months Ended December 31, | Nine Months Ended December 31, | ||||||
2023 | 2024 | 2023 | 2024 | ||||
Pro Forma Combined | Consolidated | Pro Forma Combined | Consolidated | ||||
Revenues: | |||||||
Products | $ 17,402 | $ 24,687 | $ 49,872 | $ 63,718 | |||
Services | 56,233 | 81,742 | 164,210 | 195,159 | |||
Total revenues | 73,635 | 106,429 | 214,082 | 258,877 | |||
Cost of revenues: | |||||||
Cost of products | 12,996 | 17,129 | 35,381 | 43,809 | |||
Cost of services | 19,762 | 30,517 | 58,312 | 75,294 | |||
Total cost of revenues | 32,758 | 47,646 | 93,693 | 119,103 | |||
Gross profit | $ 40,877 | $ 58,783 | $ 120,389 | $ 139,774 | |||
Product margin | 25.3 % | 30.6 % | 29.1 % | 31.2 % | |||
Service margin | 64.9 % | 62.7 % | 64.5 % | 61.4 % | |||
Total gross profit margin | 55.5 % | 55.2 % | 56.2 % | 54.0 % | |||
Incremental intangible assets | $ - | $ 5,393 | $ - | $ 9,551 | |||
Inventory rationalization | $ - | $ 6 | $ - | $ 740 | |||
Product margin | 25.3 % | 30.6 % | 29.1 % | 32.4 % | |||
Service margin | 64.9 % | 69.3 % | 64.5 % | 66.3 % | |||
Adjusted total gross profit margin | 55.5 % | 60.3 % | 56.2 % | 58.0 % | |||
POWERFLEET, INC. AND SUBSIDIARIES | |||||||
ADJUSTED OPERATING EXPENSES | |||||||
(In thousands) | |||||||
Three Months Ended December 31, | Nine Months Ended December 31, | ||||||
2023 | 2024 | 2023 | 2024 | ||||
Pro Forma | Consolidated | Pro Forma | Consolidated | ||||
Total operating expenses | $ 42,391 | $ 60,026 | $ 121,533 | $ 158,679 | |||
Adjusted for once-off costs | |||||||
Acquisition-related expenses | 4,885 | 5,301 | 7,136 | 20,872 | |||
Integration-related costs | - | 520 | - | 2,259 | |||
Stock-based compensation (non- | - | - | - | 4,693 | |||
Restructuring-related expenses | 144 | 841 | 741 | 3,108 | |||
5,029 | 6,662 | 7,877 | 30,932 | ||||
Adjusted operating expenses | $ 37,362 | $ 53,364 | $ 113,656 | $ 127,747 | |||
POWERFLEET, INC. AND MiX TELEMATICS | |||||||
Three Months Ended December 31, 2023 | |||||||
Powerfleet Inc | MiX Telematics | Adjustments to | Pro Forma | ||||
Revenues: | |||||||
Products | $ 12,916 | $ 5,430 | $ (944) | $ 17,402 | |||
Services | 21,634 | 33,655 | 944 | 56,233 | |||
Total revenues | 34,550 | 39,085 | - | 73,635 | |||
Cost of revenues: | |||||||
Cost of products | 10,009 | 3,645 | (658) | 12,996 | |||
Cost of services | 7,162 | 11,942 | 658 | 19,762 | |||
Total cost of revenues | 17,171 | 15,587 | - | 32,758 | |||
Gross profit | 17,379 | 23,498 | - | 40,877 | |||
Operating expenses: | |||||||
Selling, general and administrative | 19,337 | 19,620 | - | 38,957 | |||
Research and development expenses | 2,010 | 1,424 | - | 3,434 | |||
Total operating expenses | 21,347 | 21,044 | - | 42,391 | |||
(Loss)/income from operations | (3,968) | 2,454 | - | (1,514) | |||
Interest income | 34 | 307 | - | 341 | |||
Interest expense | (1,138) | (604) | - | (1,742) | |||
Bargain purchase - Movingdots | 1,517 | - | - | 1,517 | |||
Other (expense)/income, net | (8) | 66 | - | 58 | |||
Net (loss)/income before income taxes | (3,563) | 2,223 | - | (1,340) | |||
Income tax benefit/(expense) | 92 | (762) | - | (670) | |||
Net (loss)/income before non-controlling | (3,471) | 1,461 | - | (2,010) | |||
Non-controlling interest | (32) | - | - | (32) | |||
Net (loss)/income | (3,503) | 1,461 | - | (2,042) | |||
Accretion of preferred stock | (1,878) | - | - | (1,878) | |||
Preferred stock dividend | (1,129) | - | - | (1,129) | |||
Net (loss)/income attributable to | $ (6,510) | $ 1,461 | $ - | $ (5,049) | |||
Net (loss)/income per share attributable | $ (0.18) | $ 0.02 | $ (0.05) | ||||
Weighted average common shares | 35,706 | 70,629 | 106,335 | ||||
POWERFLEET, INC. AND MiX TELEMATICS | |||||||
Nine Months Ended December 31, 2023 | |||||||
Powerfleet Inc | MiX Telematics | Adjustments to | Pro Forma | ||||
Revenues: | |||||||
Products | $ 37,232 | $ 14,895 | $ (2,255) | $ 49,872 | |||
Services | 63,652 | 98,303 | 2,255 | 164,210 | |||
Total revenues | 100,884 | 113,198 | - | 214,082 | |||
Cost of revenues: | |||||||
Cost of products | 27,402 | 9,938 | (1,959) | 35,381 | |||
Cost of services | 22,980 | 33,373 | 1,959 | 58,312 | |||
Total cost of revenues | 50,382 | 43,311 | - | 93,693 | |||
Gross profit | 50,502 | 69,887 | - | 120,389 | |||
Operating expenses: | |||||||
Selling, general and administrative | 54,312 | 56,161 | - | 110,473 | |||
Research and development expenses | 6,657 | 4,403 | - | 11,060 | |||
Total operating expenses | 60,969 | 60,564 | - | 121,533 | |||
(Loss)/income from operations | (10,467) | 9,323 | - | (1,144) | |||
Interest income | 79 | 774 | - | 853 | |||
Interest expense | (1,466) | (1,645) | - | (3,111) | |||
Bargain purchase - Movingdots | 1,800 | - | - | 1,800 | |||
Other expense, net | (32) | (234) | - | (266) | |||
Net (loss)/income before income taxes | (10,086) | 8,218 | - | (1,868) | |||
Income tax expense | (197) | (4,900) | - | (5,097) | |||
Net (loss)/income before non-controlling | (10,283) | 3,318 | - | (6,965) | |||
Non-controlling interest | (38) | - | - | (38) | |||
Net (loss)/income | (10,321) | 3,318 | - | (7,003) | |||
Accretion of preferred stock | (5,484) | - | - | (5,484) | |||
Preferred stock dividend | (3,385) | - | - | (3,385) | |||
Net (loss)/income attributable to | $ (19,190) | $ 3,318 | $ - | $ (15,872) | |||
Net (loss)/income per share attributable | $ (0.54) | $ 0.05 | $ (0.15) | ||||
Weighted average common shares | 35,655 | 70,712 | 106,367 | ||||
POWERFLEET, INC. AND MiX TELEMATICS | |||||
March 31, 2024 | |||||
Powerfleet Inc | MiX Telematics | Pro Forma | |||
ASSETS | |||||
Current assets: | |||||
Cash and cash equivalents | $ 24,354 | $ 26,737 | $ 51,091 | ||
Restricted cash | 85,310 | 794 | 86,104 | ||
Accounts receivables, net | 30,333 | 24,675 | 55,008 | ||
Inventory, net | 21,658 | 4,142 | 25,800 | ||
Deferred costs - current | 42 | - | 42 | ||
Prepaid expenses and other current assets | 8,091 | 9,693 | 17,784 | ||
Total current assets | 169,788 | 66,041 | 235,829 | ||
Fixed assets, net | 12,719 | 35,587 | 48,306 | ||
Goodwill | 83,487 | 38,226 | 121,713 | ||
Intangible assets, net | 19,652 | 20,792 | 40,444 | ||
Right-of-use asset | 7,428 | 3,794 | 11,222 | ||
Severance payable fund | 3,796 | - | 3,796 | ||
Deferred tax asset | 2,781 | 1,093 | 3,874 | ||
Other assets | 9,029 | 10,061 | 19,090 | ||
Total assets | $ 308,680 | $ 175,594 | $ 484,274 | ||
LIABILITIES | |||||
Current liabilities: | |||||
Short-term bank debt and current maturities of long- | $ 1,951 | $ 20,158 | $ 22,109 | ||
Accounts payable and accrued expenses | 34,008 | 26,755 | 60,763 | ||
Deferred revenue - current | 5,842 | 6,394 | 12,236 | ||
Lease liability - current | 1,789 | 859 | 2,648 | ||
Total current liabilities | 43,590 | 54,166 | 97,756 | ||
Long-term debt - less current maturities | 113,810 | - | 113,810 | ||
Deferred revenue - less current portion | 4,892 | - | 4,892 | ||
Lease liability - less current portion | 5,921 | 2,852 | 8,773 | ||
Accrued severance payable | 4,597 | - | 4,597 | ||
Deferred tax liability | 4,465 | 14,204 | 18,669 | ||
Other long-term liabilities | 2,496 | 484 | 2,980 | ||
Total liabilities | 179,771 | 71,706 | 251,477 | ||
Convertible redeemable preferred stock: Series A | 90,273 | - | 90,273 | ||
STOCKHOLDERS' EQUITY | |||||
Preferred stock | - | - | - | ||
Common stock | 387 | 63,455 | 63,842 | ||
Additional paid-in capital | 202,607 | (2,389) | 200,218 | ||
Accumulated deficit | (154,796) | 76,280 | (78,516) | ||
Accumulated other comprehensive loss | (985) | (16,148) | (17,133) | ||
Treasury stock | (8,682) | (17,315) | (25,997) | ||
Total stockholders' equity | 38,531 | 103,883 | 142,414 | ||
Non-controlling interest | 105 | 5 | 110 | ||
Total equity | 38,636 | 103,888 | 142,524 | ||
Total liabilities, convertible redeemable preferred | $ 308,680 | $ 175,594 | $ 484,274 | ||
POWERFLEET, INC. AND MiX TELEMATICS | |||||
Nine Months Ended December 31, 2023 | |||||
Powerfleet Inc | MiX Telematics | Pro Forma | |||
Cash flows from operating activities | |||||
Net (loss)/income | $ (10,321) | $ 3,318 | $ (7,003) | ||
Adjustments to reconcile net (loss)/income to cash (used | |||||
Non-controlling interest | 38 | - | 38 | ||
Gain on bargain purchase | (1,800) | - | (1,800) | ||
Inventory reserve | 1,498 | 323 | 1,821 | ||
Stock based compensation expense | 3,076 | 827 | 3,903 | ||
Depreciation and amortization | 7,155 | 14,024 | 21,179 | ||
Right-of-use assets, non-cash lease expense | 2,156 | - | 2,156 | ||
Bad debts expense | 1,339 | 3,561 | 4,900 | ||
Deferred income taxes | (378) | 3,313 | 2,935 | ||
Other non-cash items | 58 | 3,849 | 3,907 | ||
Changes in operating assets and liabilities: | |||||
Accounts receivables | (2,284) | (9,268) | (11,552) | ||
Inventories | (1,506) | (524) | (2,030) | ||
Prepaid expenses and other current assets | 876 | (495) | 381 | ||
Deferred costs | 440 | (6,763) | (6,323) | ||
Deferred revenue | (292) | - | (292) | ||
Accounts payable and accrued expenses | 4,765 | 1,352 | 6,117 | ||
Lease liabilities | (2,157) | - | (2,157) | ||
Accrued severance payable, net | (21) | - | (21) | ||
Net cash provided by operating activities | 2,642 | 13,517 | 16,159 | ||
Cash flows from investing activities: | |||||
Capitalized software development costs | (2,949) | (4,254) | (7,203) | ||
Capital expenditures | (2,364) | (12,776) | (15,140) | ||
Deferred consideration paid | - | (1,414) | (1,414) | ||
Net cash used in investing activities | (5,313) | (18,444) | (23,757) | ||
Cash flows from financing activities: | |||||
Repayment of long-term debt | (3,079) | - | (3,079) | ||
Short-term bank debt, net | 4,322 | 5,946 | 10,268 | ||
Purchase of treasury stock upon vesting of restricted stock | (97) | (546) | (643) | ||
Repayment of financing lease | (129) | - | (129) | ||
Payment of preferred stock dividend and redemption of | (3,385) | - | (3,385) | ||
Proceeds from exercise of stock options, net | 36 | - | 36 | ||
Cash paid on dividends to affiliates | - | (4,002) | (4,002) | ||
Net cash (used in)/from financing activities | (2,332) | 1,398 | (934) | ||
Effect of foreign exchange rate changes on cash and cash | (754) | (846) | (1,600) | ||
Net decrease in cash and cash equivalents, and restricted | (5,757) | (4,375) | (10,132) | ||
Cash and cash equivalents, and restricted cash at beginning of | 25,089 | 30,657 | 55,746 | ||
Cash and cash equivalents, and restricted cash at end of | $ 19,332 | $ 26,282 | $ 45,614 | ||
Reconciliation of cash, cash equivalents, and restricted | |||||
Cash and cash equivalents | 24,780 | 29,876 | 54,656 | ||
Restricted cash | 309 | 781 | 1,090 | ||
Cash, cash equivalents, and restricted cash, beginning of the | $ 25,089 | $ 30,657 | $ 55,746 | ||
Reconciliation of cash, cash equivalents, and restricted | |||||
Cash and cash equivalents | 19,022 | 25,419 | 44,441 | ||
Restricted cash | 310 | 863 | 1,173 | ||
Cash, cash equivalents, and restricted cash, end of the period | $ 19,332 | $ 26,282 | $ 45,614 | ||
Supplemental disclosure of cash flow information: | |||||
Cash paid for: | |||||
Taxes | $ 170 | $ 1,587 | $ 1,757 | ||
Interest | $ 1,273 | $ 555 | $ 1,828 | ||
Noncash investing and financing activities: | |||||
Value of licensed intellectual property acquired in | $ 1,517 | $ - | $ 1,517 | ||
Preferred stock dividends paid in shares | $ 1,108 | $ - | $ 1,108 | ||
POWERFLEET, INC. ANDMiX TELEMATICS | |||||
RECONCILIATION OF GAAP TO ADJUSTED EBITDA FINANCIAL MEASURES | |||||
(In thousands) | |||||
Three Months Ended December 31, 2023 | |||||
Powerfleet Inc | MiX Telematics | Pro Forma | |||
Net (loss)/profit attributable to common stockholders | $ (6,510) | $ 1,461 | $ (5,049) | ||
Non-controlling interest | 32 | - | 32 | ||
Preferred stock dividend and accretion | 3,007 | - | 3,007 | ||
Interest expense, net | 798 | 297 | 1,095 | ||
Other expense, net | 8 | - | 8 | ||
Income tax (benefit)/expense | (92) | 762 | 670 | ||
Depreciation and amortization | 2,348 | 5,254 | 7,602 | ||
Stock-based compensation | 1,123 | 262 | 1,385 | ||
Foreign currency (gains)/losses | 144 | 493 | 637 | ||
Restructuring-related expenses | 144 | - | 144 | ||
Gain on bargain purchase - Movingdots | (1,517) | - | (1,517) | ||
Net profit on fixed assets | - | (45) | (45) | ||
Contingent consideration remeasurement | - | (511) | (511) | ||
Acquisition-related expenses | 3,685 | 1,200 | 4,885 | ||
Non-recurring transitional service agreement costs | - | 361 | 361 | ||
Adjusted EBITDA | $ 3,170 | $ 9,534 | $ 12,704 | ||
POWERFLEET, INC. AND MiX TELEMATICS | |||||
RECONCILIATION OF GAAP TO ADJUSTED EBITDA FINANCIAL MEASURES | |||||
(In thousands) | |||||
Nine Months Ended December 31, 2023 | |||||
Powerfleet Inc | MiX Telematics | Pro Forma | |||
Net (loss)/profit attributable to common stockholders | $ (19,190) | $ 3,318 | $ (15,872) | ||
Non-controlling interest | 38 | - | 38 | ||
Preferred stock dividend and accretion | 8,870 | - | 8,870 | ||
Interest expense, net | 1,386 | 871 | 2,257 | ||
Other expense, net | 32 | - | 32 | ||
Income tax expense | 197 | 4,900 | 5,097 | ||
Depreciation and amortization | 7,155 | 14,024 | 21,179 | ||
Stock-based compensation | 3,076 | 827 | 3,903 | ||
Foreign currency translation | (291) | 1,346 | 1,055 | ||
Restructuring-related expenses | 711 | 30 | 741 | ||
Gain on Bargain purchase - Movingdots | (1,800) | - | (1,800) | ||
Net profit on fixed assets | - | (49) | (49) | ||
Contingent consideration remeasurement | - | (1,049) | (1,049) | ||
Acquisition-related expenses | 5,140 | 1,996 | 7,136 | ||
Non-recurring transitional service agreement costs | - | 482 | 482 | ||
Adjusted EBITDA | $ 5,324 | $ 26,696 | $ 32,020 | ||
POWERFLEET, INC. ANDMiX TELEMATICS | |||||
RECONCILIATION OF GAAP TO NON-GAAP NET INCOME FINANCIAL MEASURES | |||||
(In thousands) | |||||
Three Months Ended December 31, 2023 | |||||
Powerfleet Inc | MiX Telematics | Pro Forma | |||
Net (loss)/income | $ (3,503) | $ 1,461 | $ (2,042) | ||
Foreign currency losses | 144 | 493 | 637 | ||
Income tax effect of net foreign exchange losses | - | (644) | (644) | ||
Restructuring-related expenses | 144 | - | 144 | ||
Acquisition-related expenses | 3,685 | 1,200 | 4,885 | ||
Non-recurring transitional service agreement costs | - | 361 | 361 | ||
Contingent consideration remeasurement | - | (511) | (511) | ||
Non-GAAP net income | $ 470 | $ 2,360 | $ 2,830 | ||
Weighted average shares outstanding | 35,706 | 70,629 | 106,335 | ||
Non-GAAP net income per share - basic | $ 0.01 | $ 0.03 | $ 0.03 | ||
POWERFLEET, INC. ANDMiX TELEMATICS | |||||
RECONCILIATION OF GAAP TO NON-GAAP NET (LOSS)/INCOME FINANCIAL MEASURES | |||||
(In thousands) | |||||
Nine Months Ended December 31, 2023 | |||||
Powerfleet Inc | MiX Telematics | Pro Forma | |||
Net (loss)/income | $ (10,321) | $ 3,318 | $ (7,003) | ||
Foreign currency (gains)/losses | (291) | 1,346 | 1,055 | ||
Income tax effect of net foreign exchange losses | - | (110) | (110) | ||
Restructuring-related expenses | 711 | 30 | 741 | ||
Income tax effect of restructuring costs | - | (7) | (7) | ||
Acquisition-related expenses | 5,140 | 1,996 | 7,136 | ||
Non-recurring transitional service agreement costs | - | 482 | 482 | ||
Contingent consideration remeasurement | - | (1,049) | (1,049) | ||
Non-GAAP net (loss)/income | $ (4,761) | $ 6,006 | $ 1,245 | ||
Weighted average shares outstanding | 35,655 | 70,712 | 106,367 | ||
Non-GAAP net (loss)/income per share - basic | $ (0.13) | $ 0.08 | $ 0.01 | ||
SOURCE Powerfleet
