Applied UV, Inc. (NASDAQ: AUVI) filled in the remaining details of Q2 FY2023 after releasing preliminary Q2 results last week that trumpeted an 83.6% increase in top-line revenue at $10.8M, compared to the prior year’s Q2. The full year results released today add some finer detail, showing that most of the revenue increase ($4.0M of the $4.9M YoY increase) in Q2 FY23 came from the company’s January 2023 acquisitions – PURO Lighting and LED Supply Co.
The other bad news left out of the preliminary release was a net loss in Q2 FY23 of $3.0M (compared to a net loss in the prior year Q2 of $2.9M). CFO Mike Riccio attributed the increase in YoY net loss to a $0.6M increase in SG&A costs (a result of the acquisitions of PURO and LED Supply), offset by improved profitability in the Hospitality segment.
CEO Max Munn noted in the earnings call that they are very focused on the path to profitability and cash flow from operations: “we’ve been aggressive with cost reduction activities, including the reduction of the number of employees by over 10%, and the payroll expense reduction of even a greater amount.” He also noted there were significant write downs related to acquisition costs, as well as one-time costs related to the company’s “pivot from our COVID-related business concentration, all of which is now behind us.”
Other highlights from today’s Q2 FY23 release included:
- An expansion of Applied UV’s relationship with its contract manufacturer Canon U.S.A. to include Canon Financial Services, Inc. to provide leasing services for all four of Applied UV’s operating subsidiaries
- LED Supply awarded an approximately $800K contract for aUS facility of a “global auto manufacturer”
- PURO (with partner AEG) selected as a finalist in a GSA demonstration program on next-gen LEDs and Far-UVC
No forward guidance for the remainder of FY23 was provided in the press release, although a June 2023 Investor presentation indicates a FY23 full year revenue estimate of $45-50M. On the earnings call, CEO Munn expressed confidence that “in the next two quarters, we will approach cash flow positive.” No analysts asked questions for the Q&A portion of this morning’s earnings call.
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