Connexa Announces Quarterly and Half Year Results
November 28 2023 - 8:11AM
Connexa Sports Technologies Inc. (Nasdaq:CNXA)
reported operating results for the quarter and half year periods
ended October 31, 2023 and provided an update and review of
operations, including launch of its Slinger Bag AI App for beta
testing.
For the second fiscal quarter ended October 31,
2023, the Company reported revenue of $2.3 million compared to $2.4
million in the year-ago period, and an operating loss of $1.2
million, down approximately 59 percent from the $4.5 million
reported in last year’s second fiscal quarter. Taking into account
orders received but not shipped due to inventory shortages in the
period to October 31, 2023, revenue would have increased
approximately 10% over the prior year.
For the six month half-year period ended October
31, 2023, the Company reported revenue of $5.4 million compared to
$6.0 million in the same period a year-ago, and an operating loss
of $3.1 million, down approximately 72 percent from the operating
loss of $7.6 million in last year’s second quarter.
“Our underlying Slinger Bag business continues
to be strong and our focus on reducing our operating expense burden
is already driving significant improvements in operating and net
income results for both the quarter and half-year periods. Our
expectation remains unchanged in that we expect to deliver revenue
growth at least 10% for fiscal 2024 and to deliver sustainable
operating profitability within the fourth quarter,” said Mike
Ballardie, CEO of Connexa Sports Technologies.
“Slinger Bag remains strongly in demand by
tennis consumers across the globe and we are now seeing demand
increasing for both our recently introduced Pickleball and Padel
Tennis launchers now that they are being seen in action out on
courts everywhere,” he continued. “In the latest quarter consumer
demand in the US outstripped supply and we found ourselves out of
inventory for the last 2 weeks of the quarter. We are working with
our Asian suppliers to build inventory at a faster rate for the
balance of this fiscal year.”
Over the last few weeks, as part of its
Sport-as-a-Service vision, the Company initiated beta testing of
its Slinger App, bringing its patent-pending AI algorithms and
analysis for tennis. Available on IOS and Android, the Slinger App
records practice session or match play video, analyzes play and
provides specific actionable feedback on how to improve.
To join our Beta testing team please complete the Beta test
application form at www.Slingerbag.com/betatest
This market provides an opportunity for
supplemental revenue growth based on monthly or yearly
subscriptions in the range of $15 and $100, respectively.
“We envision our AI platform as a product and
technology that will be at the heart of ‘powering’ the Connexa
portfolio of brands. It will be the driver of real-time data and
analytics for tennis players and the Slinger App has been designed
to be used both as a stand-alone app or in conjunction with a
player using their Slinger Bag Launcher,” commented Ballardie.
CONNEXA SPORTS TECHNOLOGIES,
INCCONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)SIX AND THREE MONTHS ENDED OCTOBER 31,
2023 AND 2022
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SIX MONTHS ENDED |
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THREE MONTHS ENDED |
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OCTOBER 31, |
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OCTOBER 31, |
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OCTOBER 31, |
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OCTOBER 31, |
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2023 |
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2022 |
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2023 |
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2022 |
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NET
SALES |
|
$ |
5,416,149 |
|
|
$ |
6,027,157 |
|
|
$ |
2,295,918 |
|
|
$ |
2,443,821 |
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COST OF
SALES |
|
|
3,876,437 |
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|
|
4,718,824 |
|
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|
1,648,955 |
|
|
|
2,156,780 |
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|
. |
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GROSS
PROFIT |
|
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1,539,712 |
|
|
|
1,308,333 |
|
|
|
646,963 |
|
|
|
287,041 |
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OPERATING
EXPENSES |
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Selling and marketing expenses |
|
|
547,390 |
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|
|
1,103,952 |
|
|
|
305,037 |
|
|
|
347,129 |
|
General and administrative expenses |
|
|
4,121,385 |
|
|
|
7,751,470 |
|
|
|
1,616,325 |
|
|
|
4,436,860 |
|
Research and development costs |
|
|
- |
|
|
|
34,405 |
|
|
|
- |
|
|
|
14,980 |
|
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|
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Total Operating Expenses |
|
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4,668,775 |
|
|
|
8,889,827 |
|
|
|
1,921,362 |
|
|
|
4,798,969 |
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OPERATING
LOSS |
|
|
(3,129,063 |
) |
|
|
(7,581,494 |
) |
|
|
(1,274,399 |
) |
|
|
(4,511,928 |
) |
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|
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NON-OPERATING INCOME
(EXPENSE) |
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|
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Amortization of debt discounts |
|
|
(790,262 |
) |
|
|
(2,872,222 |
) |
|
|
(13,070 |
) |
|
|
- |
|
Loss on conversion of accounts payable to common stock |
|
|
(289,980 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
Change in fair value of derivative liability |
|
|
16,944,807 |
|
|
|
6,787,597 |
|
|
|
14,800,253 |
|
|
|
3,100,102 |
|
Derivative expense |
|
|
(11,398,589 |
) |
|
|
(7,280,405 |
) |
|
|
(11,398,589 |
) |
|
|
(7,280,405 |
) |
Interest expense |
|
|
(421,559 |
) |
|
|
(597,580 |
) |
|
|
(352,076 |
) |
|
|
(406,277 |
) |
Interest expense - related party |
|
|
- |
|
|
|
(82,414 |
) |
|
|
- |
|
|
|
(21,293 |
) |
Interest expense |
|
|
- |
|
|
|
(82,414 |
) |
|
|
- |
|
|
|
(21,293 |
) |
|
|
|
|
|
|
|
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|
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|
|
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Total Non-Operating Income (Expenses) |
|
|
4,044,417 |
|
|
|
(4,045,024 |
) |
|
|
3,036,518 |
|
|
|
(4,607,873 |
) |
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NET INCOME (LOSS) FROM
CONTINUING OPERATIONS BEFORE PROVISION FOR INCOME
TAXES |
|
|
915,354 |
|
|
|
(11,626,518 |
) |
|
|
1,762,119 |
|
|
|
(9,119,801 |
) |
|
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DISCONTINUED
OPERATIONS |
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|
|
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|
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Loss from discontinued operations |
|
|
- |
|
|
|
(3,663,480 |
) |
|
|
- |
|
|
|
(1,903,766 |
) |
Loss on disposal of subsidiaries |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
LOSS FROM DISCONTINUED
OPERATIONS |
|
|
- |
|
|
|
(3,663,480 |
) |
|
|
- |
|
|
|
(1,903,766 |
) |
|
|
|
|
|
|
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NET INCOME (LOSS) FROM
OPERATIONS BEFORE |
|
|
|
|
|
|
|
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|
|
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PROVISION FOR INCOME TAXES |
|
|
915,354 |
|
|
|
(15,289,998 |
) |
|
|
1,762,119 |
|
|
|
(11,023,567 |
) |
|
|
|
|
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|
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|
|
|
Provision for income
taxes |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
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|
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|
NET INCOME
(LOSS) |
|
$ |
915,354 |
|
|
$ |
(15,289,998 |
) |
|
$ |
1,762,119 |
|
|
$ |
(11,023,567 |
) |
|
|
|
|
|
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|
Other comprehensive income
(loss) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
Foreign currency translations adjustment |
|
|
68,318 |
|
|
|
58,139 |
|
|
|
95,338 |
|
|
|
(34,630 |
) |
Comprehensive income
(loss) |
|
$ |
983,672 |
|
|
$ |
(15,231,859 |
) |
|
$ |
1,857,457 |
|
|
$ |
(11,058,197 |
) |
|
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Net income (loss) per
share - basic and diluted (see Note 3) |
|
|
|
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|
Continuing operations |
|
$ |
(23.13 |
) |
|
$ |
(2,708.25 |
) |
|
$ |
(14.29 |
) |
|
$ |
(3,211.20 |
) |
Discontinued operations |
|
$ |
- |
|
|
$ |
(853.36 |
) |
|
$ |
- |
|
|
$ |
(670.34 |
) |
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
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|
Net loss per share -
basic and diluted |
|
$ |
(23.13 |
) |
|
$ |
(3,561.61 |
) |
|
$ |
(14.29 |
) |
|
$ |
(3,881.54 |
) |
|
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|
|
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|
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|
Weighted average
common shares outstanding - basic and diluted |
|
|
693,092 |
|
|
|
4,293 |
|
|
|
912,147 |
|
|
|
2,840 |
|
Shareholder Letter
Further information for shareholders can be
found in an open letter posted on our website at
https://www.connexasports.com/investor-relations/
About Connexa Sports
Technologies:
Connexa Sports a leading connected sports
company delivering products, technologies, and Sport-as-a-Service
across a range of sport verticals. Connexa’s mission is to reinvent
sports through technological innovation driven by an unwavering
focus on today’s sports consumer.
Contact
Information:investors@connexasports.comwww.connexasports.com
Forward-Looking Statements
Forward-looking statements are subject to known
and unknown risks and uncertainties and are based on potentially
inaccurate assumptions that could cause actual results to differ
materially from those expected or implied by the forward-looking
statements.
Actual results could differ materially from
those anticipated in forward-looking statements for many reasons,
including the factors described in “Item 1A. Risk Factors” in our
10-K filing as of September 14, 2023 and our ability to
continue as a going concern. Accordingly, you should not rely on
these forward-looking statements, which speak only as of the date
of this press release. You should, however, review the factors and
risks we describe in the reports we will file from time to time
with the SEC after the date of this press release.
In addition, statements such as “we believe” and
similar statements reflect our beliefs and opinions on the relevant
subject. These statements are based on information available to us
as of the date of this press release. And while we believe that
information provides a reasonable basis for these statements, that
information may be limited or incomplete. Our statements should not
be read to indicate that we have conducted an exhaustive inquiry
into, or review of, all relevant information. These statements are
inherently uncertain, and you are cautioned not to rely unduly on
these statements.
Although we believe the expectations reflected
in the forward-looking statements were reasonable at the time made,
we cannot guarantee future results, level of activity, performance
or achievements. Moreover, neither we nor any other person assumes
responsibility for the accuracy or completeness of any of these
forward-looking statements. You should carefully consider the
cautionary statements contained or referred to in this section in
connection with the forward-looking statements contained in this
press release and any subsequent written or oral forward-looking
statements that may be issued by us or persons acting on our
behalf.
1 International Tennis
Federation Global Report
(2021)2 https://www.usta.com/en/home/stay-current/national/u-s--tennis-participation-grew-for-third-straight-year-in-2022.html3 https://biz.crast.net/fmi-tennis-equipment-market-growing-at-a-cagr-of-2-9-in-the-forecast-period-2029/
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