Twin Vee PowerCats (VEEE) Q3 2024 earnings summary

Executive summary

• Q3 2024 was one of the most challenging quarters, with net sales down 64% year-over-year to $2.9M and units sold down 70% due to industry-wide demand reduction and a focus on larger boats.

• The company responded with production cuts, cost controls, workforce reduction, and consolidation of operations.

• Forza X1 electric boat operations were discontinued in July 2024, and the merger with Twin Vee was approved by shareholders in November 2024.

• Net loss increased to $3.0M in Q3 2024 from $2.4M in Q3 2023; nine-month net loss rose to $9.9M from $6.2M year-over-year.

• Leadership remains optimistic about a market recovery within four to six months, citing potential positive economic and political impacts.

Financial highlights

• Q3 2024 net sales were $2.9M, down 64% year-over-year, with 20 boats sold versus 66 in Q3 2023.

• Gross margin for Q3 2024 was -5.0%, with gross profit negative $146K, compared to 7.5% and $606K in Q3 2023.

• Operating expenses in Q3 2024 were $2.8M, down 16% year-over-year, with further reductions in G&A and salaries.

• Cash and cash equivalents at quarter-end were $11.4M, down from $15.1M in the previous quarter.

• Net loss per share for Q3 2024 was ($0.26) versus ($0.20) in Q3 2023.

Outlook and guidance

• Management expects continued challenges for the next four to six months but anticipates a market rebound driven by economic and political factors.

• Plans are in place to reduce cash burn, targeting a consolidated adjusted net loss run rate of $400,000 per month or better by the end of Q1 2025.

• Investments continue in new models, facility expansion, and vertical integration to prepare for recovery.

• The new Bay Cat product line is targeted for launch in Q1 2025.

• Management expects sufficient liquidity for the next 24 months.