LogicMark, Inc. Announces Second Quarter 2022 Financial and Operational Results
August 11 2022 - 4:05PM
LogicMark, Inc. (Nasdaq: LGMK), a provider of personal emergency
response systems (PERS), health communications devices, and
technology for the growing care economy, announces financial and
operating results for the second quarter ended June 30,
2022.
Highlights Include:
- Revenue growth of 21% in Q2 and 34% YTD
- Launched Direct-to-Consumer sales channel in July 2022
- Enhanced website and e-commerce functionality to enable direct
purchases
- Investing in sales team to drive strong revenue growth
- Strong balance sheet with $11.1 million in cash and no debt at
June 30, 2022
Chia-Lin Simmons, LogicMark’s Chief Executive Officer,
commented, “In the second quarter, we continued our momentum with
year-over-year revenue growth over 20% and YTD approaching 35%.
LogicMark continues its exciting transformation into a technology
company focused on building solutions for the new care economy,
driven by our proprietary remote care and activity monitoring
solutions that leverage our core business and position us to
deliver new products and monitored services. In July, we officially
launched our Direct-to-Consumer sales channel through our new
e-commerce website.
“I’m very pleased to report that we continue to deliver on
promises we’ve made to shareholders to improve our financial
condition and corporate governance while, managing costs, and
expanding our intellectual property portfolio. LogicMark continues
to lay a solid foundation to build compelling solutions. We are on
track with expanding our product and service offerings which we
expect will diversify revenue generation and continue to drive
steady growth. We hope this will increase our margins and further
position us as a leader in the new care economy. We look forward to
providing further updates on the exciting developments in the
coming quarters,” concluded Ms. Simmons.
Q2 2022 Financial Results
Revenue for the second quarter ended June 30, 2022, was $3.4
million, up 21% over the year-ago period. Revenue growth was driven
by improved sales to VA hospitals and clinics, and from replacement
sales of 4G Guardian Alert 911 Plus devices to customers holding
the older version being impacted by 3G sunsetting. The
impact of this replacement program was largely completed by the end
of the second quarter.
Gross profit for the second quarter increased 17% over the
year-ago period. The increase in gross profit was primarily driven
by higher sales. Gross margin for the second quarter was 59% versus
61% in the second quarter of 2021. The decline was due to a shift
in product mix toward the lower margin Guardian Alert 911 Plus
units as well as higher shipping costs.
Direct operating costs in the second quarter were $337,000,
increasing 32% over the year-ago period, driven by the Company’s
business decision to provide free replacements for 3G sunsetting
units still under warranty. Selling and marketing increased to
$275,000, up $185,000 from the second quarter of 2021 as a result
of higher sales commissions, recruiting expense for additional
sales personnel and increased spending on investor relations,
public relations and social media support. Research and development
expenses declined to $205,000 versus $279,000 in the prior year.
General and administrative expenses were $2.1 million in the second
quarter of 2022, up from $1.1 million in the year-ago period. The
increase in general and administrative was due to adding resources
to support revenue growth, new product development and finance and
administrative infrastructure related expenses.
Net loss applicable to Common shareholders in the second quarter
was $1.2 million, or $0.13 per share versus a net loss of $1.2
million or $0.22 per share in the prior-year period.
Cash balance as of June 30, 2022 was $11.1 million versus $12.0
million at December 31, 2021.
Investor Call and SEC Filings
On August 11, 2022, at 1:30 pm Pacific Time, or 4:30 pm Eastern
Time, management will host a conference call and live webcast to
discuss the Company’s financial and operations results for the
second quarter ended June 30, 2022 and provide a corporate
update. A question-and-answer session will follow managements
remarks.
All participants wishing to dial into the conference call must
register to obtain a conference dial in number and their unique
conference ID by following the link:
https://registrations.events/direct/ID60124
To listen to the live webcast please visit the LogicMark
Investor Relations website here, or at
https://edge.media-server.com/mmc/p/z2eyk375. A webcast replay will
be available through August 11, 2022, at the same link. The
associated press release, SEC filings, and webcast replay will also
be accessible on the Company’s investor relations
website.
About LogicMark, Inc.
LogicMark, Inc. (Nasdaq: LGMK) provides personal emergency
response systems (PERS), health communications devices and IoT
technologies to create a Connected Care Platform. The Company’s
devices give people the ability to receive care at home and
confidence to age in place. LogicMark revolutionized the PERS
industry by incorporating two-way voice communication technology
directly into its medical alert pendant and providing this
life-saving technology at a price point that everyday consumers can
afford. The Company’s PERS technologies are sold through the United
States Veterans Health Administration and dealers/distributors.
LogicMark has been awarded a contract by the U.S. General Services
Administration that enables the Company to distribute its products
to federal, state, and local governments.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Forward-looking statements reflect management’s current
expectations, as of the date of this press release, and involve
certain risks and uncertainties. Forward-looking statements include
statements herein with respect to the successful execution of the
Company’s business strategy and expectations regarding its growth,
market, products and services. The Company’s actual results could
differ materially from those anticipated in these forward-looking
statements as a result of various factors. Such risks and
uncertainties include, among other things, our ability to establish
and maintain the proprietary nature of our technology through the
patent process, as well as our ability to possibly license from
others patents and patent applications necessary to develop
products; the availability of financing; the Company’s ability to
implement its long range business plan for various applications of
its technology; the Company’s ability to enter into agreements with
any necessary marketing and/or distribution partners; the impact of
competition, the obtaining and maintenance of any necessary
regulatory clearances applicable to applications of the Company’s
technology; the Company’s ability to maintain its Nasdaq listing
for its common stock; and management of growth and other risks and
uncertainties that may be detailed from time to time in the
Company’s reports filed with the SEC.
Investor Relations Contact: CORE
IR Investor@logicmark.com
Financial tables to follow:
LogicMark, Inc.
CONDENSED BALANCE SHEETS
LogicMark, Inc |
|
|
|
BALANCE SHEETS |
|
|
|
|
|
|
|
|
June 30, |
|
December 31, |
|
2022 |
|
2021 |
Assets |
|
|
|
Current Assets |
|
|
|
Cash |
$ |
11,144,085 |
|
|
$ |
12,044,415 |
|
Restricted cash |
|
59,988 |
|
|
|
210,131 |
|
Accounts receivable, net |
|
258,509 |
|
|
|
98,749 |
|
Inventory, net |
|
622,893 |
|
|
|
1,237,280 |
|
Prepaid expenses and other current assets |
|
773,509 |
|
|
|
849,190 |
|
Total Current Assets |
|
12,858,984 |
|
|
|
14,439,765 |
|
|
|
|
|
Property and equipment: |
|
|
|
Equipment |
|
412,135 |
|
|
|
410,444 |
|
Furniture and fixtures |
|
35,761 |
|
|
|
35,761 |
|
Website and other |
|
171,217 |
|
|
|
9,427 |
|
|
|
619,113 |
|
|
|
455,632 |
|
Accumulated depreciation |
|
(446,975 |
) |
|
|
(455,632 |
) |
Property and equipment, net |
|
172,138 |
|
|
|
- |
|
Right-of-use assets, net |
|
216,345 |
|
|
|
248,309 |
|
Product development costs |
|
269,268 |
|
|
|
- |
|
Goodwill |
|
10,958,662 |
|
|
|
10,958,662 |
|
Other intangible assets, net of amortization of $4,516,204 and
$4,127,920, respectively |
|
4,093,171 |
|
|
|
4,476,647 |
|
|
|
|
|
Total Assets |
$ |
28,568,568 |
|
|
$ |
30,123,383 |
|
|
|
|
|
Liabilities, Redeemable Series C Preferred Stock and
Stockholders' Equity |
|
|
|
|
|
|
|
Current Liabilities |
|
|
|
Accounts payable |
$ |
788,511 |
|
|
$ |
492,431 |
|
Accrued expenses |
|
862,223 |
|
|
|
849,285 |
|
Total Current Liabilities |
|
1,650,734 |
|
|
|
1,341,716 |
|
Other long-term liabilities |
|
349,006 |
|
|
|
385,196 |
|
Total Liabilities |
|
1,999,740 |
|
|
|
1,726,912 |
|
|
|
|
|
Commitments and Contingencies (Note 8) |
|
|
|
|
|
|
|
Redeemable Series C Preferred Stock |
|
|
|
Redeemable Series C Preferred Stock, par value $0.0001 per share:
2,000 shares designated; 200 shares issued and outstanding as of
June 30, 2022 and December 31, 2021 |
|
1,807,300 |
|
|
|
1,807,300 |
|
|
|
|
|
Stockholders' Equity |
|
|
|
Preferred Stock, par value $0.0001 per share: 10,000,000 shares
authorized |
|
|
|
Series F Preferred Stock, par value $0.0001 per share: 1,333,333
shares designated; 173,333 shares issued and outstanding as of June
30, 2022, aggregate liquidation preference of $520,000 as of June
30, 2022, and December 31, 2021 |
|
520,000 |
|
|
|
520,000 |
|
Common Stock, par value $0.0001 per share: 100,000,000 shares
authorized; 9,608,937 and 9,163,039 issued and outstanding as of
June 30, 2022 and December 31, 2021 |
|
961 |
|
|
|
917 |
|
Additional paid-in capital |
|
105,318,990 |
|
|
|
104,725,115 |
|
Accumulated deficit |
|
(81,078,423 |
) |
|
|
(78,656,861 |
) |
|
|
|
|
Total Stockholders' Equity |
|
24,761,528 |
|
|
|
26,589,171 |
|
|
|
|
|
Total Liabilities, Redeemable Series C Preferred Stock and
Stockholders' Equity |
$ |
28,568,568 |
|
|
$ |
30,123,383 |
|
|
|
|
|
LogicMark, Inc.
CONDENSED STATEMENTS OF
OPERATIONS
|
Three Months Ended |
|
|
Six Months Ended |
|
|
June 30, |
|
|
June 30, |
|
|
2022 |
|
|
2021 (1) |
|
|
2022 |
|
|
2021 (1) |
|
Revenues |
$ |
3,367,692 |
|
|
$ |
2,782,575 |
|
|
$ |
7,018,380 |
|
|
$ |
5,221,256 |
|
Costs of goods
sold |
|
1,364,586 |
|
|
|
1,074,878 |
|
|
|
2,811,891 |
|
|
|
2,064,265 |
|
Gross
Profit |
|
2,003,106 |
|
|
|
1,707,697 |
|
|
|
4,206,489 |
|
|
|
3,156,991 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Direct operating cost |
|
336,544 |
|
|
|
255,859 |
|
|
|
810,987 |
|
|
|
500,528 |
|
Selling and marketing |
|
275,011 |
|
|
|
89,781 |
|
|
|
464,216 |
|
|
|
169,904 |
|
Research and development |
|
204,592 |
|
|
|
279,450 |
|
|
|
467,077 |
|
|
|
593,344 |
|
General and
administrative |
|
2,115,700 |
|
|
|
1,078,258 |
|
|
|
4,451,647 |
|
|
|
2,457,327 |
|
Other expense |
|
2,000 |
|
|
|
14,697 |
|
|
|
32,084 |
|
|
|
25,268 |
|
Depreciation and
amortization |
|
194,691 |
|
|
|
201,324 |
|
|
|
389,054 |
|
|
|
405,181 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Operating
Expenses |
|
3,128,538 |
|
|
|
1,919,369 |
|
|
|
6,615,065 |
|
|
|
4,151,552 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Loss |
|
(1,125,432 |
) |
|
|
(211,672 |
) |
|
|
(2,408,576 |
) |
|
|
(994,561 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income and
(Expense) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income (expense) |
|
13,159 |
|
|
|
(389,541 |
) |
|
|
13,159 |
|
|
|
(1,250,789 |
) |
Forgiveness of Paycheck
Protection Program loan and accrued interest |
|
- |
|
|
|
45,466 |
|
|
|
- |
|
|
|
349,176 |
|
Warrant modification
expense |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(2,881,729 |
) |
Total Other Expense,
Net |
|
13,159 |
|
|
|
(344,075 |
) |
|
|
13,159 |
|
|
|
(3,783,342 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss before Income
Taxes |
|
(1,112,273 |
) |
|
|
(555,747 |
) |
|
|
(2,395,417 |
) |
|
|
(4,777,903 |
) |
Income tax (expense)
benefit |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Net Loss |
|
(1,112,273 |
) |
|
|
(555,747 |
) |
|
|
(2,395,417 |
) |
|
|
(4,777,903 |
) |
Preferred stock dividends |
|
(88,144 |
) |
|
|
(615,000 |
) |
|
|
(176,144 |
) |
|
|
(2,170,801 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss Applicable to Common
Stockholders |
$ |
(1,200,417 |
) |
|
$ |
(1,170,747 |
) |
|
$ |
(2,571,561 |
) |
|
$ |
(6,948,704 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss Per Share - Basic and
Diluted |
$ |
(0.13 |
) |
|
$ |
(0.22 |
) |
|
$ |
(0.27 |
) |
|
$ |
(1.37 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average
Number of Common Shares Outstanding - Basic and
Diluted |
|
9,594,746 |
|
|
|
5,331,190 |
|
|
|
9,538,666 |
|
|
|
5,076,636 |
|
(1) Expenses in 2021 have been reclassified to conform to the
2022 presentation format.
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