Powerfleet Reports First Quarter 2025 Financial Results

Focused execution following the business combination with MiX Telematics evidenced by annual revenue and AEBITDA growth of +10% and +50%, respectively

Revenue Grows 10.2% annually to $75.4 million, driven by unity ecosystem and safety-centric solutions

Cost synergy traction with $8.7 million in annual run-rate savings secured by end of June quarter

WOODCLIFF LAKE, N.J. , Aug. 22, 2024 /PRNewswire/ -- Powerfleet, Inc. (Nasdaq: AIOT), reported its financial results for the first quarter ended June 30, 2024. This marks the first full quarter post-close of the MiX Telematics Ltd. business combination with prior year comparison numbers adjusted to reflect the pro forma financial performance of the combined businesses.

FIRST QUARTER 2025 HIGHLIGHTS

  • Total revenue was $75.4 million, up 10.2% year-over-year, driven by the strength of our safety-centric product solutions.
  • Product revenue rose by 29% year-over-year to $18.7 million, reflecting strong demand for our differentiated product offerings; building our recurring revenue base; and contributing to a 7% expansion in product gross margin.
  • Excluding the impact of non-cash charges from the amortization of acquisition-related intangibles, gross profit increased by $3.5 million, or 9.0%.
  • Adjusted EBITDA, a non-GAAP metric, totaled $13.7 million, a significant 52.2% increase year-over-year, driven by strong topline performance and the realization of initial cost synergies.

MANAGEMENT COMMENTARY

"I'm incredibly proud of the traction we've gained and the significant progress our team has made following the close of the MiX Telematics transaction in early April", said CEO Steve Towe. "The successful execution of our integration strategy is already evident in our strong financial performance this quarter, with a 10% increase in combined revenue and a remarkable 50% rise in adjusted EBITDA compared to the prior year. This reflects our ability to drive radical change without disrupting operations, setting a solid foundation for sustained growth."

"Our strategic rationale behind the MiX transaction was clear: securing scale is critical to distinguishing our combined business from competitors and aligning with market leaders as the core telematics industry rapidly transforms. By leveraging our Unity ecosystem's advanced AI platforms and next-generation data capabilities, we are poised to thrive in a market that increasingly values innovation and agility."

"We are also off to a strong start in achieving our cost synergy commitments, securing $8.7 million in annual savings within the first 90 days. These savings have provided us with the flexibility to make targeted investments in our go-to-market and customer success teams, leading to a 30% increase in our sales force in the coming months. As we continue to work towards our target of $27 million in savings, we remain focused on scaling our operations and driving sustainable growth as we advance toward our goal of rule 40 performance over the next two years."

FIRST QUARTER 2025 FINANCIAL RESULTS

Total revenue for the quarter increased by 10.2% year-over-year to $75.4 million, up from $68.4 million in the same period last year. This growth was largely driven by the continued success of the company's differentiated safety-centric product solutions, with product revenue increasing over 29% to $18.7 million.

Service revenue grew by 5% year-over-year to $56.7 million. This performance highlights the strength of the Unity product strategy and the benefits of operating at scale globally, which helped mitigate the impact of previously disclosed churn in the legacy MiX customer base and macro and geopolitical pressures in certain regions, such as Israel.

Combined gross margin of 52.6% includes a $3.0 million non-cash expense for the amortization of acquisition-related intangibles from the MiX business combination. Excluding this expense, adjusted gross margin was 56.5%, compared to 57.2% in the prior year, with the current period's performance partially affected by a higher proportion of product sales.

Operating expenses for the quarter totaled $57.9 million, including $20.4 million in one-time transaction, restructuring, and accelerated stock-based compensation costs. On an adjusted basis, excluding these one-time costs, operating expenses were $37.5 million and in line with the prior year.

The company reported a net loss attributable to common stockholders of $22.3 million, or $(0.21) per share, compared to $(0.04) in the prior year. However, after adjusting for one-time expenses and the amortization of acquisition-related intangibles, adjusted earnings per share was $0.00 for the current year.

Adjusted EBITDA increased by 52.2% to $13.7 million from $9.0 million in the previous year. This growth was driven by strong topline performance, resulting in a $3.5 million increase in gross margin after accounting for the impact of the amortization of acquisition-related intangibles.

The company ended the quarter with net debt of $108.2 million, comprising $31.4 million in cash and $139.6 million in total debt. After accounting for unsettled transaction costs, pro forma net debt was $114 million versus $110 million at the MiX transaction close date. The $4 million increase in pro forma net debt was primarily driven by an increase in net working capital of $7.0 million that is directly attributable to higher receivables following strong topline performance.

FULL-YEAR 2025 FINANCIAL OUTLOOK

The company is reiterating its updated guidance from the August 6th fireside chat. Full-year 2025 revenue is expected to exceed $300 million, an increase from the initial guidance of approximately $300 million. Adjusted EBITDA is anticipated to exceed $60 million, inclusive of an incremental $5 million in secured exit run-rate cost synergies, compared to its initial guidance of around $60 million.

INVESTOR CONFERENCE CALL

As previously announced, Powerfleet will hold a conference call on Thursday, August 22, 2024, at 8:30 a.m. Eastern time (5:30 a.m. Pacific time) to discuss results for the quarter ended June 30, 2024.

Management will make prepared remarks followed by a question-and-answer session.

Date: Thursday, August 22, 2024
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: 263975

The conference call will be broadcast simultaneously and available for replay here and via the investor section of the company'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 operating expenses and adjusted earnings per share. 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, 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; TASE: PWFL) 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.

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 its beliefs, plans, goals, objectives, expectations, anticipations, assumptions, estimates, intentions and future performance, as well as anticipated financial impacts of our transaction with MiX Telematics. Forward-looking statements involve significant known and unknown risks, uncertainties and other factors, which may cause their 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, including the conflict between Israel and Hamas; (ii) integration of our and MiX Telematics' businesses and the ability to recognize the anticipated synergies and benefits of the transaction with MiX Telematics; (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 transaction 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; (ix) failure to make timely filings of our periodic reports with the Securities and Exchange Commission ("SEC"), including our transition report on Form 10-KT for the period from January 1, 2024 to March 31, 2024 and our quarterly report on Form 10-Q for the quarter ended June 30, 2024, and (x) such other factors as are set forth in the periodic reports filed by us with the 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
LHA Investor Relations
AIOTIRTeam@lhai.com

Powerfleet Media Contact
Andrea Hayton
ahayton@powerfleet.com
+1 (610) 401-1999

POWERFLEET, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(In thousands, except per share data)



Three Months Ended June 30,


2023


2024


Pro Forma
combined


Consolidated

Revenues:




Products

$                        14,523


$                        18,738

Services

53,920


56,692

Total revenues

68,443


75,430





Cost of revenues:




Cost of products

10,931


12,751

Cost of services

18,381


23,031

Total cost of revenues

29,312


35,782





Gross profit

39,131


39,648





Operating expenses:




Selling, general and administrative expenses

34,575


54,782

Research and development expenses

3,565


3,101

Total operating expenses

38,140


57,883





Gain/(loss) from operations

991


(18,235)





Interest income

291


304

Interest expense

(676)


(2,691)

Bargain purchase - Movingdots

283


Other income, net

(709)


(624)





Net gain/(loss) before income taxes

180


(21,246)





Income tax expense

(1,836)


(1,053)





Net loss before non-controlling interest

(1,656)


(22,299)

Non-controlling interest

(6)


(13)





Net loss

(1,662)


(22,312)





Accretion of preferred stock

(1,772)


Preferred stock dividend

(1,128)


(25)





Net loss attributable to common stockholders

$                        (4,562)


$                      (22,337)





Net loss per share attributable to common stockholders - basic and diluted

$                          (0.04)


$                          (0.21)





Weighted average common shares outstanding - basic and diluted

106,390


107,136

 

POWERFLEET, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(In thousands, except per share data)




March 31, 2024


June 30, 2024



Pro Forma
combined


Consolidated

ASSETS





Current assets:





Cash and cash equivalents


$                        51,091


$                        30,242

Restricted cash


86,104


1,151

Accounts receivables


55,008


60,132

Inventory, net


25,800


25,832

Deferred costs - current


42


24

Prepaid expenses and other current assets


17,784


16,498

Total current assets


235,829


133,879

Fixed assets, net


48,306


49,705

Goodwill


121,713


300,775

Intangible assets, net


40,444


170,093

Right-of-use asset


11,222


10,722

Severance payable fund


3,796


3,760

Deferred tax asset


3,874


3,544

Other assets


19,090


12,435

Total assets


$                      484,274


$                      684,913






LIABILITIES





Current liabilities:





Short-term bank debt and current maturities of long-term debt


$                        22,109


$                        27,604

Accounts payable and accrued expenses


60,763


68,771

Deferred revenue - current


12,236


10,019

Lease liability - current


2,648


2,441

Contingent consideration



Total current liabilities


97,756


108,835

Long-term debt - less current maturities


113,810


111,957

Deferred revenue - less current portion


4,892


4,825

Lease liability - less current portion


8,773


8,555

Accrued severance payable


4,597


4,533

Deferred tax liability


18,669


52,645

Other long-term liabilities


2,980


3,015

Total liabilities


251,477


294,365






Convertible redeemable preferred stock:


90,273







STOCKHOLDERS' EQUITY





Preferred stock



Common stock


63,842


1,096

Additional paid-in capital


200,218


578,514

Accumulated deficit


(78,516)


(177,108)

Accumulated other comprehensive loss


(17,133)


(567)

Treasury stock


(25,997)


(11,518)






Total stockholders' equity


142,414


390,417

Non-controlling interest


110


131

Total equity


142,524


390,548






Total liabilities, convertible redeemable preferred stock, and
stockholders' equity


$                      484,274


$                      684,913

 

POWERFLEET, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(In thousands)




Three Months Ended June 30,



2023


2024



Pro Forma
combined


Consolidated

Cash flows from operating activities





Net loss


$                        (1,662)


$                      (22,312)

Adjustments to reconcile net loss to cash used in operating activities:





Non-controlling interest


6


13

Gain on bargain purchase


(283)


Inventory reserve


443


257

Stock based compensation expense


1,092


5,929

Depreciation and amortization


6,334


10,335

Right-of-use assets, non-cash lease expense


660


760

Bad debts expense


1,416


1,993

Deferred income taxes


1,990


1,021

Shares issued for transaction bonuses



891

Other non-cash items


1,760


481

Changes in operating assets and liabilities:





Accounts receivables


(4,008)


(6,973)

Inventories


984


(624)

Prepaid expenses and other current assets


(38)


(1,518)

Deferred costs


(1,677)


(1,789)

Deferred revenue


58


(142)

Accounts payable and accrued expenses


(1,991)


4,993

Lease liabilities


(650)


(927)

Accrued severance payable, net


88


(2)






Net cash generated by/(used in) operating activities


4,522


(7,615)






Cash flows from investing activities





Acquisition, net of cash assumed



27,531

Capitalized software development costs


(2,352)


(2,308)

Capital expenditures


(4,582)


(5,586)






Net cash (used in)/provided by investing activities


(6,934)


19,637






Cash flows from financing activities





Repayment of long-term debt


(1,875)


(493)

Short-term bank debt, net


2,800


4,161

Purchase of treasury stock upon vesting of restricted stock


(4)


(2,836)

Payment of preferred stock dividend and redemption of preferred stock


(1,128)


(90,298)

Proceeds from exercise of stock options, net


36


Cash paid on dividends to affiliates


(1,331)


(4)






Net cash used in financing activities


(1,502)


(89,470)






Effect of foreign exchange rate changes on cash and cash equivalents


(1,930)


(824)

Net decrease in cash and cash equivalents, and restricted cash


(5,844)


(78,272)

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


$                        49,902


$                        31,393






Reconciliation of cash, cash equivalents, and restricted cash,
beginning of the period





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 period





Cash and cash equivalents


48,830


30,242

Restricted cash


1,072


1,151

Cash, cash equivalents, and restricted cash, end of the period


$                        49,902


$                        31,393






Supplemental disclosure of cash flow information:





Cash paid for:





Taxes


$                             273


$                                41

Interest


$                             356


$                          3,057






Noncash investing and financing activities:

 





Common stock issued for transaction bonus


$                                —


$                                  9

 

POWERFLEET, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO ADJUSTED EBITDA FINANCIAL MEASURES

(In thousands)



Three Months Ended June 30,


2023


2024


Pro Forma
combined


Consolidated

Net loss attributable to common stockholders

$                        (4,562)


$                      (22,337)

Non-controlling interest

6


13

Preferred stock dividend and accretion

2,901


25

Interest expense

690


2,916

Other expense, net


1

Income tax expense

1,836


1,053

Depreciation and amortization

6,334


10,335

Stock-based compensation

1,092


5,929

Foreign Currency Translation

368


108

Restructuring Related Expenses

448


1,198

Gain on Bargain purchase - Movingdots

(283)


Net profit on fixed assets

(4)


Contingent consideration remeasurement

(24)


Acquisition related expenses

223


14,494

Adjusted EBITDA

$                          9,025


$                        13,735

 

POWERFLEET, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP NET INCOME (LOSS) FINANCIAL MEASURES

(In thousands)



Three Months Ended June 30,


2023


2024


Pro Forma
combined


Consolidated

Net loss

$                        (1,662)


$                      (22,312)

Incremental Intangible assets amortization expense as a result of  MiX
Telematics business combination


2,995

 Stock-based compensation (non-recurring/accelerated cost)


4,693

 Foreign currency translation 

368


108

 Income tax effect of net foreign exchange gains/(losses)

425


(747)

 Restructuring related expenses

448


1,198

 Income tax effect of restructuring costs

(5)


(103)

 Acquisition related expenses

223


14,494

Non-GAAP net (loss)/income

$                           (203)


$                             326





Weighted average shares outstanding

106,390


$                      107,136





Non-GAAP net (loss)/income  per share - basic

(0.002)


$                          0.003

 

POWERFLEET, INC. AND SUBSIDIARIES

ADJUSTED GROSS PROFIT MARGINS

(In thousands)



Three Months Ended June 30,


2023


2024


Pro Forma
combined


Consolidated

Revenues:




Products

$                       14,523


$                       18,738

Services

53,920


56,692

Total revenues

68,443


75,430





Cost of revenues:




Cost of products

10,931


12,751

Cost of services

18,381


23,031

Total cost of revenues

29,312


35,782





Gross profit

39,131


39,648





Product Margin

24.7 %


32.0 %

Service Margin

65.9 %


59.4 %

Total Gross profit margin

57.2 %


52.6 %





Incremental Intangible assets amortization expense as a result of MiX
Telematics business combination


2,995





Product Margin

24.7 %


32.0 %

Service Margin

65.9 %


64.7 %

Adjusted Total Gross profit margin

57.2 %


56.5 %

 

POWERFLEET, INC. AND SUBSIDIARIES

ADJUSTED OPERATING EXPENSES

(In thousands)



Three Months Ended June 30,


2023


2024


Pro Forma
combined


Consolidated

Total operating expenses

$                        38,140


$                        57,883

Adjusted for once-off costs




Acquisition related expenses

223


14,494

Stock-based compensation (non-recurring/accelerated cost)


4,693

Restructuring Related Expenses

448


1,198


$                             671


$                        20,385





Adjusted operating expenses

$                        37,469


$                        37,498

 

POWERFLEET, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(In thousands, except per share data)



Year Ended March 31,


2023


2024


Pro Forma
combined


Consolidated

Revenues:




Products

$                        70,397


$                        67,665

Services

210,072


219,239

Total revenues

280,469


286,904





Cost of revenues:




Cost of products

51,143


48,316

Cost of services

71,486


79,636

Total cost of revenues

122,629


127,952





Gross profit

157,840


158,952





Operating expenses:




Selling, general and administrative expenses

138,566


151,839

Research and development expenses

13,049


14,793

Total operating expenses

151,615


166,632





Gain/(loss) from operations

6,225


(7,680)





Interest income

1,241


1,480

Interest expense

(689)


(4,521)

Bargain purchase - Movingdots

7,234


1,800

Other income/(expense), net

1,622


(266)





Net gain/(loss) before income taxes

15,633


(9,187)





Income tax expense

(9,749)


(7,014)





Net gain/(loss) before non-controlling interest

5,884


(16,201)

Non-controlling interest

2


(50)





Net gain/(loss)

5,886


(16,251)





Accretion of preferred stock

(6,210)


(15,480)

Preferred stock dividend

(4,310)


(4,514)





Net loss attributable to common stockholders

$                        (4,634)


$                      (36,245)





Net loss per share attributable to common stockholders - basic and diluted

$                          (0.04)


$                          (0.34)





Weighted average common shares outstanding - basic and diluted

106,073


106,894

 

POWERFLEET, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP NET INCOME (LOSS) FINANCIAL MEASURES

(In thousands)



Year Ended March 31,


2023


2024


Pro Forma
combined


Consolidated

Net loss attributable to common stockholders

$                        (4,634)


$                      (36,245)

Non-controlling interest

(2)


49

Preferred stock dividend and accretion

10,520


19,995

Interest expense

947


3,192

Other expense, net

67


87

Income tax expense

9,749


7,014

Depreciation and amortization

24,072


29,548

Stock-based compensation

5,220


5,214

Foreign Currency Translation

(3,191)


1,493

Restructuring Related Expenses

2,445


1,065

Gain on Bargain purchase - Movingdots

(7,234)


(1,800)

Impairment of long-lived assets

104


139

Net profit on sale of fixed assets

(25)


(115)

Non-recurring transitional service agreement costs


482

Contingent consideration remeasurement

(504)


(1,299)

Acquisition related expenses

1101


14,313

Adjusted EBITDA

$                        38,635


$                        43,132

 

POWERFLEET, INC, AND MiX TELEMATICS

Condensed Consolidated Statements of Operations

(In thousands, except per share data)


Three Months Ended June 30, 2023


Powerfleet Inc


MiX Telematics


Adjustments to
align disclosure


Pro Forma
Consolidated

Revenues:








Products

$               11,084


$                  4,140


$                   (701)


$               14,523

Services

21,008


32,211


701


53,920

Total revenues

32,092


36,351



68,443









Cost of revenues:








Cost of products

8,550


3,025


(644)


10,931

Cost of services

7,524


10,213


644


18,381

Total cost of revenues

16,074


13,238



29,312









Gross profit

16,018


23,113



39,131









Operating expenses:








Selling, general and administrative expenses

17,198


17,377



34,575

Research and development expenses

2,221


1,344



3,565

Total operating expenses

19,419


18,721



38,140









(Loss)/gain from operations

(3,401)


4,392



991









Interest income

22


269



291

Interest expense

(174)


(502)



(676)

Bargain purchase - Movingdots

283




283

Other expense, net


(709)



(709)









Net (loss)/gain before income taxes

(3,270)


3,450



180









Income tax benefit/(expense)

6


(1,842)



(1,836)









Net (loss)/profit before non-controlling interest

(3,264)


1,608



(1,656)

Non-controlling interest

(6)




(6)









Net (loss)/profit

(3,270)


1,608



(1,662)









Accretion of preferred stock

(1,772)




(1,772)

Preferred stock dividend

(1,128)




(1,128)









Net (loss)/profit attributable to common stockholders

$                (6,170)


$                  1,608


$                       —


$                (4,562)









Net (loss)/profit per share attributable to
common stockholders - basic and diluted

$                  (0.17)


$                    0.02




$                  (0.04)









Weighted average common shares outstanding -
basic and diluted

35,605


70,785




106,390

 

POWERFLEET, INC, AND MiX TELEMATICS

Condensed Consolidated Balance Sheets

(In thousands)




March 31, 2024



Powerfleet Inc


MiX Telematics


Pro Forma
Combined

ASSETS







Current assets:







Cash and cash equivalents


$             24,354


$               26,737


$               51,091

Restricted cash


85,310


794


86,104

Accounts receivables


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-term debt


$               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:


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 stock,
and stockholders' equity


$           308,680


$             175,594


$             484,274

 

POWERFLEET INC, AND MiX TELEMATICS

Condensed Consolidated Statements of Cash Flows

(In thousands)




Three Months Ended June 30, 2023 



Powerfleet
Inc.


MiX
Telematics


Pro Forma
Combined

Cash flows from operating activities







Net loss


$          (3,270)


$            1,608


$           (1,662)

Adjustments to reconcile net loss to cash used in operating activities:






$                  —

Non-controlling interest


6



6

Gain on bargain purchase


(283)



(283)

Inventory reserve


373


70


443

Stock based compensation expense


852


240


1,092

Depreciation and amortization


2,322


4,012


6,334

Right-of-use assets, non-cash lease expense


660



660

Bad debts expense


598


818


1,416

Deferred income taxes


(24)


2,014


1,990

Other non-cash items


29


1,731


1,760

Changes in operating assets and liabilities:






Accounts receivables


(668)


(3,340)


(4,008)

Inventories


389


595


984

Prepaid expenses and other current assets


344


(382)


(38)

Deferred costs


185


(1,862)


(1,677)

Deferred revenue


58



58

Accounts payable and accrued expenses


(1,466)


(525)


(1,991)

Lease liabilities


(650)



(650)

Accrued severance payable, net


88



88








Net cash (used in)/provided by operating activities


(457)


4,979


4,522








Cash flows from investing activities







Capitalized software development costs


(997)


(1,355)


(2,352)

Capital expenditures


(966)


(3,616)


(4,582)








Net cash used in investing activities


(1,963)


(4,971)


(6,934)








Cash flows from financing activities







Repayment of long-term debt


(1,329)


(546)


(1,875)

Short-term bank debt, net


2,737


63


2,800

Purchase of treasury stock upon vesting of restricted stock


(4)



(4)

Payment of preferred stock dividend and redemption of preferred stock


(1,128)



(1,128)

Proceeds from exercise of stock options, net


36



36

Cash paid on dividends to affiliates



(1,331)


(1,331)








Net cash from/(used in) financing activities


312


(1,814)


(1,502)








Effect of foreign exchange rate changes on cash and cash equivalents


(943)


(987)


(1,930)

Net decrease in cash and cash equivalents, and restricted cash


(3,051)


(2,793)


(5,844)

Cash and cash equivalents, and restricted cash at beginning of the period


25,089


30,657


55,746








Cash and cash equivalents, and restricted cash at end of the period


$          22,038


$          27,864


$          49,902








Reconciliation of cash, cash equivalents, and restricted cash, beginning of the
period







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 period


$          25,089


$          30,657


$          55,746








Reconciliation of cash, cash equivalents, and restricted cash, end of the period







Cash and cash equivalents


21,729


27,101


48,830

Restricted cash


309


763


1,072

Cash, cash equivalents, and restricted cash, end of the period


$          22,038


$          27,864


$          49,902








Supplemental disclosure of cash flow information:







Cash paid for:







Taxes


$                101


$                172


$                273

Interest


$                238


$                118


$                356








Noncash investing and financing activities:

 







Common stock issued for transaction bonus


$                  —


$                  —


$                  —









 

POWERFLEET INC, AND MiX TELEMATICS

RECONCILIATION OF GAAP TO ADJUSTED EBITDA FINANCIAL MEASURES

(In thousands)



Three Months Ended June 30, 2023


Powerfleet Inc.


MiX Telematics


Pro Forma
Combined

Net loss attributable to common stockholders

$                        (6,170)


$                          1,608


$                        (4,562)

Non-controlling interest

6



6

Preferred stock dividend and accretion

2,901



2,901

Interest expense, net

457


233


690

Income tax (benefit)/expense

(6)


1,842


1,836

Depreciation and amortization

2,322


4,012


6,334

Stock-based compensation

852


240


1,092

Foreign Currency Translation

(362)


730


368

Restructuring Related Expenses

425


23


448

Gain on Bargain purchase - Movingdots

(283)



(283)

Net profit on sale of fixed assets


(4)


(4)

Contingent consideration remeasurement


(24)


(24)

Acquisition related expenses

223


0


223

Adjusted EBITDA

$                             365


$                          8,660


$                          9,025

 

POWERFLEET, INC. AND MIX TELEMATICS

RECONCILIATION OF GAAP TO NON-GAAP NET INCOME (LOSS) FINANCIAL MEASURES

(In thousands)



Three Months Ended June 30, 2023


Powerfleet Inc.


MiX Telematics


Pro Forma
Combined

Net (loss)/income

$                        (3,270)


$                          1,608


$                        (1,662)

Foreign currency translation

(362)


730


368

Income tax effect of net foreign exchange (losses)/gains


425


425

Restructuring related expenses

425


23


448

Income tax effect of restructuring costs


(5)


(5)

Acquisition related expenses

223



223

Non-GAAP net (loss)/income

$                        (2,984)


$                          2,781


$                           (203)







Weighted average shares outstanding

35,605


70,785


106,390







Non-GAAP net (loss)/income  per share - basic

$                        (0.084)


$                          0.039


$                        (0.002)







 

POWERFLEET, INC, AND MiX TELEMATICS

Condensed Consolidated Statements of Operations

(In thousands, except per share data)



Year Ended March 31, 2023


Powerfleet Inc


MiX Telematics


Adjustments to
align disclosure


Pro Forma
Combined

Revenues:








Products

$               54,934


$               18,337


$                (2,874)


$               70,397

Services

80,542


126,656


2,874


210,072

Total revenues

135,476


144,993



280,469









Cost of revenues:








Cost of products

39,660


14,054


(2,571)


51,143

Cost of services

28,842


40,073


2,571


71,486

Total cost of revenues

68,502


54,127



122,629









Gross profit

66,974


90,866



157,840









Operating expenses:








Selling, general and administrative expenses

64,856


73,710



138,566

Research and development expenses

7,458


5,591



13,049

Total operating expenses

72,314


79,301



151,615









(Loss)/income from operations

(5,340)


11,565



6,225









Interest income

82


1,159



1,241

Interest expense

757


(1,446)



(689)

Bargain purchase - Movingdots

7,234




7,234

Other income, net

(67)


1,689



1,622









Net income before income taxes

2,666


12,967



15,633









Income tax expense

(1,304)


(8,445)



(9,749)









Net loss before non-controlling interest

1,362


4,522



5,884

Non-controlling interest

2




2









Net income

1,364


4,522



5,886









Accretion of preferred stock

(6,210)




(6,210)

Preferred stock dividend

(4,310)




(4,310)









Net (loss)/income attributable to common stockholders

$                (9,156)


$                  4,522


$                       —


$                (4,634)









Net (loss)/income per share attributable to
common stockholders - basic and diluted

$                  (0.26)


$                    0.06


$                       —


$                  (0.04)









Weighted average common shares outstanding -
basic and diluted

35,548


70,525



106,073

 

POWERFLEET, INC, AND MiX TELEMATICS

Condensed Consolidated Statements of Operations

  (In thousands, except per share data)



Year Ended March 31, 2024


Powerfleet Inc


MiX Telematics


Adjustments to
align disclosure


Pro Forma
Combined

Revenues:








Products

$               49,313


$               21,600


$                (3,248)


$               67,665

Services

85,311


130,680


3,248


219,239

Total revenues

134,624


152,280



286,904









Cost of revenues:








Cost of products

36,916


14,628


(3,228)


48,316

Cost of services

31,003


45,405


3,228


79,636

Total cost of revenues

67,919


60,033



127,952









Gross profit

66,705


92,247



158,952









Operating expenses:








Selling, general and administrative expenses

76,144


75,695



151,839

Research and development expenses

8,675


6,118



14,793

Total operating expenses

84,819


81,813



166,632









(Loss)/income from operations

(18,114)


10,434



(7,680)









Interest income

338


1,142



1,480

Interest expense

(2,174)


(2,347)



(4,521)

Bargain purchase - Movingdots

1,800




1,800

Other income, net

(87)


(179)



(266)









Net (loss)/income before income taxes

(18,237)


9,050



(9,187)









Income tax expense

(549)


(6,465)



(7,014)









Net (loss)/income before non-controlling interest

(18,786)


2,585



(16,201)

Non-controlling interest

(50)




(50)









Net (loss)/income

(18,836)


2,585



(16,251)









Accretion of preferred stock

(15,480)




(15,480)

Preferred stock dividend

(4,514)




(4,514)









Net (loss)/income attributable to common stockholders

$              (38,830)


$                  2,585


$                       —


$              (36,245)









Net (loss)/income per share attributable to
common stockholders - basic and diluted

$                  (1.08)


$                    0.04




$                  (0.34)









Weighted average common shares outstanding -
basic and diluted

35,813


71,081




106,894

 

POWERFLEET INC, AND MiX TELEMATICS

RECONCILIATION OF GAAP TO ADJUSTED EBITDA FINANCIAL MEASURES

(In thousands)



Year Ended March 31, 2023


Powerfleet Inc.


MiX Telematics


Pro Forma
Combined

Net loss attributable to common stockholders

$                        (9,156)


$                          4,522


$                        (4,634)

Non-controlling interest

(2)



(2)

Preferred stock dividend and accretion

10,520



10,520

Interest expense, net

660


287


947

Other expense, net

67



67

Income tax expense

1,304


8,445


9,749

Depreciation and amortization

8,463


15,609


24,072

Stock-based compensation

4,718


502


5,220

Foreign Currency Translation

(2,081)


(1,110)


(3,191)

Restructuring Related Expenses

1,423


1,022


2,445

Gain on Bargain purchase - Movingdots

(7,234)



(7,234)

Impairment of long-lived assets


104


104

Net profit on sale of fixed assets


(25)


(25)

Contingent consideration remeasurement


(504)


(504)

Acquisition related expenses

317


784


1,101

Adjusted EBITDA

$                          8,999


$                        29,636


$                        38,635



Year Ended March 31, 2024


Powerfleet Inc.


MiX Telematics


Pro Forma
Combined

Net loss attributable to common stockholders

$                      (38,830)


$                          2,585


$                      (36,245)

Non-controlling interest

49



49

Preferred stock dividend and accretion

19,995



19,995

Interest expense, net

1,987


1,205


3,192

Other expense, net

87



87

Income tax expense

549


6,465


7,014

Depreciation and amortization

9,098


20,450


29,548

Stock-based compensation

4,104


1,110


5,214

Foreign Currency Translation

(248)


1,741


1,493

Restructuring Related Expenses

1,035


30


1,065

Gain on Bargain purchase - Movingdots

(1,800)



(1,800)

Impairment of long-lived assets


139


139

Net profit on sale of fixed assets


(115)


(115)

Non-recurring transitional service agreement costs


482


482

Contingent consideration remeasurement


(1,299)


(1,299)

Acquisition related expenses

11218


3095


14,313

Adjusted EBITDA

$                          7,244


$                        35,888


$                        43,132

 

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SOURCE Powerfleet