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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d)
of
the Securities Exchange Act of 1934
Date
of Report (Date of earliest event reported): August 21, 2023
DRAGONFLY
ENERGY HOLDINGS CORP.
(Exact
name of registrant as specified in its charter)
Nevada |
|
001-40730 |
|
85-1873463 |
(State
or other jurisdiction
of
incorporation) |
|
(Commission
File
Number) |
|
(IRS
Employer
Identification
No.) |
1190
Trademark Drive, #108 |
|
|
Reno,
Nevada |
|
89521 |
(Address
of principal executive offices) |
|
(Zip
Code) |
(775)
622-3448
(Registrant’s
telephone number, including area code)
N/A
(Former
name or former address, if changed since last report)
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under
any of the following provisions:
☐ |
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ |
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ |
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ |
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e- 4(c)) |
Securities
registered pursuant to Section 12(b) of the Act:
Title
of each class |
|
Trading Symbol(s) |
|
Name
of each exchange on which registered |
Common
stock, par value $0.0001 |
|
DFLI |
|
The
Nasdaq Global Market |
Redeemable
warrants, exercisable for common stock at an exercise price of $11.50 per share, subject to adjustment |
|
DFLIW |
|
The
Nasdaq Capital Market |
Indicate
by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405
of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging
growth company ☒
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Item
2.02. Results of Operations and Financial Condition.
On
August 21, 2023, Dragonfly Energy Holdings Corp. (the “Company”) issued an earnings disclosing certain information
regarding its results of operations for the second quarter ended June 30, 2023. Following the publication of the press release, the Company
will host an earnings call at 5:00 p.m. (Eastern Time) on August 21, 2023, via a webcast. During the webcast, the Company’s
financial results for the second quarter ended June 30, 2023 will be discussed. A copy of the press release is attached as Exhibit 99.1
to this Current Report on Form 8-K.
Item
7.01. Regulation FD Disclosure.
See
“Item 2.02 Results of Operation and Financial Condition” above.
The
information in this Current Report on Form 8-K under Items 2.02 and 7.01, including the information contained in Exhibit 99.1, is being
furnished to the Securities and Exchange Commission (the “SEC”), and shall not be deemed to be “filed”
for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise
subject to the liabilities of that section, and shall not be deemed to be incorporated by reference into any filing under the Securities
Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by a specific reference in such filing.
Item
9.01. Financial Statements and Exhibits.
(d)
Exhibits.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
|
DRAGONFLY
ENERGY HOLDINGS CORP. |
|
|
|
|
By: |
/s/
Denis Phares |
|
Name: |
Denis
Phares |
|
Title: |
Chief
Executive Officer |
Date:
August 21, 2023
Exhibit
99.1
Dragonfly
Energy Reports Second Quarter 2023 Financial Results
U.S.
lithium battery cell pilot program complete; full cell production expected by year end
RENO,
NEVADA (August 21, 2023) — Dragonfly Energy Holdings Corp. (“Dragonfly Energy” or the “Company”) (Nasdaq:
DFLI), an industry leader in energy storage and producer of deep cycle lithium-ion storage batteries, today reported its financial and
operational results for the second quarter ended June 30, 2023.
Second
Quarter 2023 Financial Highlights
| ● | Net
Sales were $19.3 million, compared to $21.6 million in Q2 2022 |
| ● | Gross
Profit was $4.1 million, compared to $7.0 million in Q2 2022 |
| ● | Operating
expenses were $(12.5) million, compared to $(7.6) million in Q2 2022 |
| ● | Net
Loss of $(11.7) million, compared to a Net Loss of $(1.5) million in Q2 2022 |
| ● | Diluted
Loss per share was $(0.25) compared to $(0.04) in Q2 2022 |
| ● | EBITDA
of $(7.3) million, compared to $(0.3) million in Q2 2022 |
Operational
and Business Highlights
| ● | Announced
completion of U.S. lithium battery cell pilot line and beginning of anode manufacturing at
scale, using patented deposition process |
| ● | Announced
U.S. Patent for innovative battery pack assembly design, enabling flexible custom installation
solutions and increased energy density |
| ● | Announced
partnership with nuCamp, the world’s largest teardrop trailer and small camper manufacturers,
to provide full lithium power systems as standard equipment on 2024 model year products |
| ● | Dragonfly
Energy joined the Russell 2000® Index |
“We
have achieved a number of important milestones since our last call, with our patent pertaining to preparation and powder film deposition
of pre-coated powders and completion of our lithium battery cell pilot program,” said Denis Phares, CEO of Dragonfly Energy. “While
the business continues to experience some near-term market headwinds, Dragonfly Energy is executing our plan; growing our market share
in our core markets, addressing new growth opportunities, and making significant progress on our cell manufacturing goals. We are excited
for what lies ahead and sharing that with you in the coming quarters.”
Second
Quarter 2023 Financial and Operating Results
Dragonfly
generated net sales of $19.3 million in the second quarter, in line with the Company’s $18.0 to $22.0 million revenue guidance.
Our revenue declined by $2.3 million from $21.6 million in the second quarter of 2022 as growth from our OEM customers was offset by
declines in our direct-to-consumer (“DTC”) business.
Gross
profit in the quarter was $4.1 million, compared to $7.0 million in the second quarter of 2022. The decrease in gross profit was primarily
due to the change in revenue mix that included a larger percentage of lower margin OEM sales and a lower percentage of higher margin
DTC sales, as well as an increase in material costs.
Second
quarter 2023 operating expenses of $(12.5) million, were higher compared to $(7.6) million in the second quarter of 2022. Higher professional
services, compliance, and insurance, as well as higher personnel, severance, stock-based compensation and materials costs drove the increase.
The
Company had a net loss of $(11.7) million, or $(0.25) per diluted share in the second quarter of 2023, compared to a net loss of $(1.5)
million or $(0.04) per diluted share in the second quarter of 2022. Net income in the second quarter of 2023 was primarily impacted by
lower DTC segment sales, increased cost of goods sold, higher operating expenses, and increased other expenses.
Second
quarter 2023 EBITDA was $(7.3) million, compared to EBITDA of $(0.3) million in the second quarter of 2022. Second quarter 2023 Adjusted
EBITDA, excluding stock-based compensation, costs associated with our offering in June, and the impact of a separation agreement and
changes in fair market value of the Company’s warrants was $(5.5) million in the quarter, compared to $0.2 million in the same
quarter a year ago.
The
Company ended the second quarter of 2023 with $33.0 million in cash. Dragonfly Energy retains strong financial flexibility with access
to a $150 million equity line of credit.
Q3
2023 Outlook
The
Company continues to face headwinds in its core markets, which are dominated by consumer discretionary spending. The RV industry, in
particular, is undergoing more severe unit declines than previously expected, with deliveries expected to fall to volumes not seen in
a decade. As a result of this industry weakness, we were informed in July 2023 that our largest RV customer has instituted a de-contenting
strategy that ultimately changed our storage offering from a standard installation to a dealer option. While this customer is not
moving to a different solution or competitor, we do expect this change in strategy to have a material limiting effect on our revenue
throughout the remainder of 2023. In light of this change, we have removed all previously forecasted revenue from this customer for
the remainder of the year.
| ● | Net
Sales are expected to range between $16.0 - $20.0 million, impacted by overall softer demand
from the RV market |
| ● | Gross
Margin is expected to improve modestly on a sequential basis |
| ● | Operating
Expenses are expected to be in a range of $(10.0) - $(13.0) million |
| ● | Other
Income (Expense) is expected be an expense in the range of $(4.0) - $(4.5) million |
| ● | Net
Losses are expected to be between $(10.0) - $(13.0) million for the quarter, or $(0.21) -
$(0.27) per share based on 48.0 million shares outstanding |
Webcast
Information
The
Dragonfly Energy management team will host a conference call to discuss its first quarter 2023 financial results this afternoon, Monday,
August 21, 2023, at 5:00 pm ET. The call can also be accessed live via telephone by dialing (888) 259-6580 or for international callers
(416) 764-8624, and referencing Dragonfly Energy. Please log in to the webcast or dial in to the call at least 10 minutes prior to the
start of the event. The live webcast of the conference will also be available at https://investors.dragonflyenergy.com/events-and-presentations/default.aspx
on the Events and Presentations page on the Investor Relations section of Dragonfly’s website.
About
Dragonfly
Dragonfly
Energy Holdings Corp. (Nasdaq: DFLI) headquartered in Reno, Nevada, is a leading supplier of deep cycle lithium-ion batteries. Dragonfly
Energy’s research and development initiatives are revolutionizing the energy storage industry through innovative technologies and
manufacturing processes. Today, Dragonfly Energy’s non-toxic deep cycle lithium-ion batteries are displacing lead-acid batteries
across a wide range of end-markets, including RVs, marine vessels, off-grid installations, and other storage applications. Dragonfly
Energy is also focused on delivering an energy storage solution to enable a more sustainable and reliable smart grid through the future
deployment of the Company’s proprietary and patented solid-state cell technology. To learn more, visit www.dragonflyenergy.com/investors.
Forward-Looking
Statements
This
press release contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of
1995. Forward-looking statements include all statements that are not historical statements of fact and statements regarding the Company’s
intent, belief or expectations, including, but not limited to, statements regarding the Company’s guidance for 2023 results of
operations and financial position, planned products and services, business strategy and plans, market size and growth opportunities,
competitive position and technological and market trends. Some of these forward-looking statements can be identified by the use of forward-looking
words, including “may,” “should,” “expect,” “intend,” “will,” “estimate,”
“anticipate,” “believe,” “predict,” “plan,” “targets,” “projects,”
“could,” “would,” “continue,” “forecast” or the negatives of these terms or variations
of them or similar expressions.
These
forward-looking statements are subject to risks, uncertainties, and other factors (some of which are beyond the Company’s control)
which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Factors that
may impact such forward-looking statements include, but are not limited to: headwinds in the Company’s core markets, including
the RV market, the Company’s ability to successfully increase market penetration into target markets; the growth of the addressable
markets that the Company intends to target; the Company’s ability to retain members of its senior management team and other key
personnel; the Company’s ability to maintain relationships with key suppliers including suppliers in China; the Company’s
ability to maintain relationships with key customers; the Company’s ability to access capital as and when needed under its $150
million ChEF Equity Facility; the Company’s ability to protect its patents and other intellectual property; the Company’s
ability to successfully optimize solid state cells and to produce commercially viable solid state cells in a timely manner or at all,
and to scale to mass production; the Company’s ability to achieve the anticipated benefits of its customer arrangements with THOR
Industries and THOR Industries’ affiliated brands (including Keystone RV Company); the impact of the coronavirus disease pandemic,
including any mutations or variants thereof and/or the Russian/Ukrainian conflict; the Company’s ability to generate revenue from
future product sales and its ability to achieve and maintain profitability; and the Company’s ability to compete with other manufacturers
in the industry and its ability to engage target customers and successfully convert these customers into meaningful orders in the future.
These and other risks and uncertainties are described more fully in the sections entitled “Risk Factors” and “Cautionary
Note Regarding Forward-Looking Statements” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022
and in the Company’s subsequent filings with the SEC available at www.sec.gov.
If
any of these risks materialize or any of the Company’s assumptions prove incorrect, actual results could differ materially from
the results implied by these forward-looking statements. There may be additional risks that the Company presently does not know or that
it currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements.
All forward-looking statements contained in this press release speak only as of the date they were made. Except to the extent required
by law, the Company undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after
the date on which they were made.
Investor
Relations:
Sioban
Hickie, ICR, Inc.
DragonflyIR@icrinc.com
Dragonfly
Energy Holdings Corp.
Unaudited
Condensed Interim Consolidated Statements of Operations
(U.S.
Dollars in Thousands, except share and per share data)
| |
Three Months Ended | |
| |
June 30, 2023 | | |
June 30, 2022 | |
| |
| | |
| |
Net Sales | |
$ | 19,274 | | |
$ | 21,622 | |
| |
| | | |
| | |
Cost of Goods Sold | |
| 15,176 | | |
| 14,594 | |
| |
| | | |
| | |
Gross Profit | |
| 4,098 | | |
| 7,028 | |
| |
| | | |
| | |
Operating Expenses | |
| | | |
| | |
Research and development | |
| 1,067 | | |
| 859 | |
General and administrative | |
| 7,614 | | |
| 3,816 | |
Selling and marketing | |
| 3,808 | | |
| 2,881 | |
| |
| | | |
| | |
Total Operating Expenses | |
| 12,489 | | |
| 7,556 | |
| |
| | | |
| | |
Loss From Operations | |
| (8,391 | ) | |
| (528 | ) |
| |
| | | |
| | |
Other (Expense) Income | |
| | | |
| | |
Interest expense | |
| (4,113 | ) | |
| (1,228 | ) |
Change in fair market value of warrant liability | |
| 804 | | |
| - | |
Total Other (Expense) Income | |
| (3,309 | ) | |
| (1,228 | ) |
| |
| | | |
| | |
Loss Before Taxes | |
| (11,700 | ) | |
| (1,756 | ) |
| |
| | | |
| | |
Income Tax (Benefit) Expense | |
| - | | |
| (287 | ) |
| |
| | | |
| | |
Net Loss | |
$ | (11,700 | ) | |
$ | (1,469 | ) |
| |
| | | |
| | |
Loss Per Share- Basic | |
$ | (0.25 | ) | |
$ | (0.04 | ) |
Loss Per Share- Diluted | |
$ | (0.25 | ) | |
$ | (0.04 | ) |
Weighted Average Number of Shares- Basic | |
| 47,418,269 | | |
| 36,616,430 | |
Weighted Average Number of Shares- Diluted | |
| 47,418,269 | | |
| 36,616,430 | |
Dragonfly
Energy Holdings Corp.
Unaudited
Condensed Interim Consolidated Statements of Operations
(U.S.
Dollars in Thousands, except share and per share data)
| |
Six Months Ended | |
| |
June 30, 2023 | | |
June 30, 2022 | |
| |
| | |
| |
Net Sales | |
$ | 38,065 | | |
$ | 39,925 | |
| |
| | | |
| | |
Cost of Goods Sold | |
| 29,224 | | |
| 27,402 | |
| |
| | | |
| | |
Gross Profit | |
| 8,841 | | |
| 12,523 | |
| |
| | | |
| | |
Operating Expenses | |
| | | |
| | |
Research and development | |
| 1,947 | | |
| 1,198 | |
General and administrative | |
| 17,109 | | |
| 7,442 | |
Selling and marketing | |
| 7,992 | | |
| 5,973 | |
| |
| | | |
| | |
Total Operating Expenses | |
| 27,048 | | |
| 14,613 | |
| |
| | | |
| | |
Loss From Operations | |
| (18,207 | ) | |
| (2,090 | ) |
| |
| | | |
| | |
Other (Expense) Income | |
| | | |
| | |
Interest expense | |
| (7,928 | ) | |
| (2,491 | ) |
Change in fair market value of warrant liability | |
| 19,327 | | |
| - | |
Total Other (Expense) Income | |
| 11,399 | | |
| (2,491 | ) |
| |
| | | |
| | |
Loss Before Taxes | |
| (6,808 | ) | |
| (4,581 | ) |
| |
| | | |
| | |
Income Tax (Benefit) Expense | |
| - | | |
| (814 | ) |
| |
| | | |
| | |
Net Loss | |
$ | (6,808 | ) | |
$ | (3,767 | ) |
| |
| | | |
| | |
Loss Per Share- Basic | |
$ | (0.15 | ) | |
$ | (0.10 | ) |
Loss Per Share- Diluted | |
$ | (0.15 | ) | |
$ | (0.10 | ) |
Weighted Average Number of Shares- Basic | |
| 46,263,591 | | |
| 36,579,990 | |
Weighted Average Number of Shares- Diluted | |
| 46,263,591 | | |
| 36,579,990 | |
Dragonfly
Energy Holdings Corp.
Unaudited
Condensed Consolidated Balance Sheets
(U.S.
Dollars in Thousands, except share and per share data)
| |
June 30, 2023 | | |
December 31, 2022 | |
Current Assets | |
| | | |
| | |
Cash | |
$ | 32,952 | | |
$ | 17,781 | |
Accounts receivable, net of allowance for credit losses | |
| 2,172 | | |
| 1,444 | |
Inventory | |
| 44,198 | | |
| 49,846 | |
Prepaid expenses | |
| 1,199 | | |
| 1,624 | |
Prepaid inventory | |
| 2,942 | | |
| 2,002 | |
Prepaid income tax | |
| 529 | | |
| 525 | |
Other current assets | |
| 239 | | |
| 267 | |
Total Current Assets | |
| 84,231 | | |
| 73,489 | |
Property and Equipment | |
| | | |
| | |
Machinery and equipment | |
| 15,932 | | |
| 10,214 | |
Office furniture and equipment | |
| 275 | | |
| 275 | |
Leasehold improvements | |
| 1,727 | | |
| 1,709 | |
Vehicle | |
| 33 | | |
| 195 | |
Total | |
| 17,967 | | |
| 12,393 | |
Less accumulated depreciation and amortization | |
| (2,180 | ) | |
| (1,633 | ) |
Property and Equipment, Net | |
| 15,787 | | |
| 10,760 | |
Operating lease right of use asset | |
| 3,912 | | |
| 4,513 | |
Total Assets | |
$ | 103,930 | | |
$ | 88,762 | |
| |
| | | |
| | |
Current Liabilities | |
| | | |
| | |
Accounts payable | |
$ | 19,990 | | |
$ | 13,475 | |
Accrued payroll and other liabilities | |
| 9,758 | | |
| 6,295 | |
Customer deposits | |
| 152 | | |
| 238 | |
Uncertain tax position liability | |
| 128 | | |
| 128 | |
Notes payable, current portion, net of deferred financing fees | |
| 22,372 | | |
| 19,242 | |
Operating lease liability, current portion | |
| 1,239 | | |
| 1,188 | |
Total Current Liabilities | |
| 53,639 | | |
| 40,566 | |
Long-Term Liabilities | |
| | | |
| | |
Warrant liabilities | |
| 14,637 | | |
| 32,831 | |
Accrued expenses, long-term | |
| 551 | | |
| 492 | |
Operating lease liability, net of current portion | |
| 2,890 | | |
| 3,541 | |
Total Long-Term Liabilities | |
| 18,078 | | |
| 36,864 | |
Total Liabilities | |
| 71,717 | | |
| 77,430 | |
| |
| | | |
| | |
Equity | |
| | | |
| | |
Common stock, 170,000,000 shares at $0.0001 par value, authorized, 58,504,541 and 43,272,728 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively | |
| 6 | | |
| 4 | |
Preferred stock, 5,000,000 shares at $0.0001 par value, authorized, no shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively | |
| - | | |
| - | |
Additional paid in capital | |
| 66,148 | | |
| 38,461 | |
Retained deficit | |
| (33,941 | ) | |
| (27,133 | ) |
Total Equity | |
| 32,213 | | |
| 11,332 | |
Total Liabilities and Shareholders’ Equity | |
$ | 103,930 | | |
$ | 88,762 | |
Dragonfly
Energy Holdings Corp.
Unaudited
Condensed Consolidated Statement of Cash Flows
(U.S.
Dollars in Thousands)
| |
Six
Months Ended | |
| |
June
30, 2023 | | |
June
30, 2022 | |
Cash
flows from Operating Activities | |
| | | |
| | |
Net
Loss | |
$ | (6,808 | ) | |
$ | (3,767 | ) |
Adjustments
to Reconcile Net Loss to Net Cash | |
| | | |
| | |
Used
in Operating Activities | |
| | | |
| | |
Stock
based compensation | |
| 5,441 | | |
| 719 | |
Amortization
of debt discount | |
| 620 | | |
| 1,196 | |
Change
in fair market value of warrant liability | |
| (19,327 | ) | |
| - | |
Deferred
tax liability | |
| - | | |
| (819 | ) |
Non-cash
interest expense (paid-in-kind) | |
| 2,510 | | |
| - | |
Provision
for doubtful accounts | |
| 93 | | |
| - | |
Depreciation
and amortization | |
| 593 | | |
| 389 | |
Loss
on disposal of property and equipment | |
| 116 | | |
| 62 | |
Changes
in Assets and Liabilities | |
| | | |
| | |
Accounts
receivable | |
| (821 | ) | |
| (3,876 | ) |
Inventories | |
| 5,648 | | |
| (15,141 | ) |
Prepaid
expenses | |
| 425 | | |
| (1,236 | ) |
Prepaid
inventory | |
| (940 | ) | |
| 4,308 | |
Other
current assets | |
| 28 | | |
| (1,962 | ) |
Other
assets | |
| 601 | | |
| 551 | |
Income
taxes payable | |
| (4 | ) | |
| (973 | ) |
Accounts
payable and accrued expenses | |
| 6,272 | | |
| 820 | |
Customer
deposits | |
| (86 | ) | |
| (183 | ) |
Total
Adjustments | |
| 1,169 | | |
| (16,145 | ) |
Net
Cash Used in Operating Activities | |
| (5,639 | ) | |
| (19,912 | ) |
| |
| | | |
| | |
Cash
Flows From Investing Activities | |
| | | |
| | |
Purchase
of property and equipment | |
| (2,571 | ) | |
| (4,819 | ) |
Net
Cash Used in Investing Activities | |
| (2,571 | ) | |
| (4,819 | ) |
| |
| | | |
| | |
Cash
Flows From Financing Activities | |
| | | |
| | |
Proceeds
from public offering, net | |
| 22,002 | | |
| - | |
Payment
of offering costs | |
| (362 | ) | |
| - | |
Proceeds
from public offering (ATM), net | |
| 671 | | |
| - | |
Proceeds
from note payable, related party | |
| 1,000 | | |
| - | |
Repayment
of note payable, related party | |
| (1,000 | ) | |
| - | |
Proceeds
from exercise of public warrants | |
| 747 | | |
| - | |
Proceeds
from exercise of options | |
| 323 | | |
| 200 | |
Net
Cash Provided by Financing Activities | |
| 23,381 | | |
| 200 | |
| |
| | | |
| | |
Net
Increase (Decrease) in Cash | |
| 15,171 | | |
| (24,531 | ) |
Beginning
cash | |
| 17,781 | | |
| 28,630 | |
Ending
cash | |
$ | 32,952 | | |
$ | 4,099 | |
Use
of Non-GAAP Financial Measures
The
Company provides non-GAAP financial measures including EBITDA and Adjusted EBITDA as a supplement to GAAP financial information to enhance
the overall understanding of the Company’s financial performance and to assist investors in evaluating the Company’s results
of operations, period over period. Adjusted non-GAAP measures exclude significant unusual items. Investors should consider these non-GAAP
measures as a supplement to, and not a substitute for financial information prepared on a GAAP basis.
Adjusted
EBITDA
Adjusted
EBITDA is considered a non-GAAP financial measure under the rules of the SEC because it excludes certain amounts included in net loss
calculated in accordance with GAAP. Specifically, the Company calculates Adjusted EBITDA by GAAP net loss adjusted to exclude stock-based
compensation expense, business combination related expenses and other one-time, non-recurring items.
The
Company has included Adjusted EBITDA because it is a key measure used by Dragonfly’s management team to evaluate its operating
performance, generate future operating plans, and make strategic decisions, including those relating to operating expenses. As such,
the Company believes Adjusted EBITDA is helpful in highlighting trends in the ongoing core operating results of the business.
Adjusted
EBITDA has limitations as an analytical tool, and it should not be considered in isolation or as a substitute for analysis of net loss
or other results as reported under GAAP. Some of these limitations are:
|
● |
Adjusted
EBITDA does not reflect the Company’s cash expenditures, future requirements for capital expenditures, or contractual commitments; |
|
|
|
|
● |
Adjusted
EBITDA does not reflect changes in, or cash requirements for, the Company’s working capital needs; |
|
|
|
|
● |
Adjusted
EBITDA does not reflect the Company’s tax expense or the cash requirements to pay taxes; |
|
|
|
|
● |
although
amortization and depreciation are non-cash charges, the assets being amortized and depreciated will often have to be replaced in
the future and Adjusted EBITDA does not reflect any cash requirements for such replacements; |
|
|
|
|
● |
Adjusted
EBITDA should not be construed as an inference that the Company’s future results will be unaffected by unusual or non-recurring
items for which the Company may adjust in historical periods; and |
|
|
|
|
● |
other
companies in the industry may calculate Adjusted EBITDA differently than the Company does, limiting its usefulness as a comparative
measure.
|
Reconciliations
of Non-GAAP Financial Measures
EBITDA
and Adjusted EBITDA
The
following table presents reconciliations of EBITDA and Adjusted EBITDA to the most directly comparable GAAP financial measure for each
of the periods indicated.
Dragonfly
Energy Holdings Corp.
Reconciliation
of GAAP to Non-GAAP Measures (Unaudited)
(in
thousands, except share and per share data)
| |
Three Months Ended | |
| |
June 30, 2023 | | |
June 30, 2022 | |
Net Income | |
$ | (11,700 | ) | |
$ | (1,469 | ) |
Interest Expense | |
| 4,113 | | |
| 1,228 | |
Taxes | |
| - | | |
| (287 | ) |
Depreciation and Amortization | |
| 296 | | |
| 272 | |
EBITDA | |
$ | (7,291 | ) | |
$ | (256 | ) |
| |
| | | |
| | |
Adjustments | |
| | | |
| | |
Stock-Based Compensation(1) | |
| 954 | | |
| 431 | |
Separation Agreement(2) | |
| 720 | | |
| - | |
June Offering Costs(3) | |
| 904 | | |
| - | |
Promissory Note Forgiveness(4) | |
| - | | |
| - | |
Change in Fair Market Value of Warrant Liability(5) | |
| (804 | ) | |
| - | |
Adjusted EBITDA | |
$ | (5,517 | ) | |
$ | 175 | |
Source:
Dragonfly Energy Holdings Corp.
Dragonfly
Energy Holdings Corp.
Reconciliation
of GAAP to Non-GAAP Measures (Unaudited)
(in
thousands, except share and per share data)
| |
Six Months Ended | |
| |
June 30, 2023 | | |
June 30, 2022 | |
Net Income | |
$ | (6,808 | ) | |
$ | (3,767 | ) |
Interest Expense | |
| 7,928 | | |
| 2,491 | |
Taxes | |
| - | | |
| (814 | ) |
Depreciation and Amortization | |
| 593 | | |
| 389 | |
EBITDA | |
$ | 1,713 | | |
$ | (1,701 | ) |
| |
| | | |
| | |
Adjustments | |
| | | |
| | |
Stock-Based Compensation(1) | |
| 5,441 | | |
| 719 | |
Separation Agreement(2) | |
| 720 | | |
| - | |
June Offering Costs(3) | |
| 904 | | |
| - | |
Promissory Note Forgiveness(4) | |
| - | | |
| 469 | |
Change in Fair Market Value of Warrant Liability(5) | |
| (19,327 | ) | |
| - | |
Adjusted EBITDA | |
$ | (10,549 | ) | |
$ | (513 | ) |
|
(1) |
Stock-Based
Compensation is comprised of costs associated with option and RSU grants made to our employees, consultants and board members. |
|
(2)
|
Separation
Agreement is comprised of $720 in cash severance associated with the separation agreement dated April 26, 2023 between us and our
former Chief Legal Officer. |
|
(3) |
June
Offering Costs is comprised of fees and expenses, including legal, accounting, and other expenses associated with our secondary offering. |
|
(4) |
Promissory
Note Forgiveness is comprised of the loan that was forgiven, prior to the Business Combination, in connection with the promissory
note, with a maturity date of March 1, 2026, between us and John Marchetti, our former Chief Financial Officer. |
|
(5) |
Change
in fair market value of warrant liability represents the change in fair value January 1, 2023 through June 30, 2023. |
v3.23.2
Cover
|
Aug. 21, 2023 |
Document Type |
8-K
|
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false
|
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|
Entity File Number |
001-40730
|
Entity Registrant Name |
DRAGONFLY
ENERGY HOLDINGS CORP.
|
Entity Central Index Key |
0001847986
|
Entity Tax Identification Number |
85-1873463
|
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NV
|
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|
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