Solar Integrated Roofing Corp. Reports Record Third Quarter 2022 Financial Results
Revenue Grew 333% to $57.3 Million with Net Income of $6.2 Million; Filing of Form 10 Registration Statement Represents Key Milestone Achievement in Uplisting Strategy
HENDERSON, Nev., Nov. 21, 2022 (GLOBE NEWSWIRE) -- Solar Integrated Roofing Corp. (OTC: SIRC), an integrated, single-source solutions provider for solar power, roofing systems installation and EV charging company, today reported its financial and operational results for the third quarter ended September 30, 2022.
Key Operational and Financial Highlights
Revenue in the third quarter increased 333% to $57.3 million, as compared to $13.2 million in the third quarter of 2021.
Net income in the third quarter increased to $6.2 million, or $0.01 per diluted share, as compared to a net loss of $1.7 million, or $(0.00) per diluted share, in the third quarter of 2021.
Revenue expected to be realized from remaining performance obligations for commercial solar contracts totaled $291.6 million as of September 30, 2022.
Filed a Form 10 Registration Statement with the U.S. Securities and Exchange Commission to register its common stock under the Securities Exchange Act of 1934; Transition to a fully reporting company represents a key milestone towards the Company’s goal of a NASDAQ listing.
Management Commentary
“The third quarter of 2022 was highlighted by the increasing pace of operational execution, as evidenced by our 333%, year-over-year, revenue growth and strong profitability,” said David Massey, Chief Executive Officer of Solar Integrated Roofing Corp. “Our continued success in cross-selling the complimentary solutions in our portfolio are allowing us to make the most of our acquisitions. The momentum we have, paired with the forecasted synergies and operational efficiencies, have allowed us to reduce operating expenses despite our impressive revenue growth. We believe this positions us extremely well to finish out 2022 and expand aggressively in 2023.
“During the quarter we achieved a crucial milestone on our journey to uplist to NASDAQ, with the filing of a Form 10 Registration Statement with the U.S. Securities and Exchange Commission. The transition to a fully reporting company represents an exciting achievement as we strive towards our goal of a NASDAQ listing in 2023, which we expect to improve liquidity and broaden our institutional shareholder base through an enhanced profile within the investment community.
“To prepare ourselves for a future NASDAQ listing, we are strengthening our management team on several fronts – most recently with the appointment of veteran operations executive Stefan Abbruzzese as President. Stefan has already begun to lend his extensive functional knowledge to drive operational improvements across our integrated family of companies, with these productivity and resource optimization efforts expected to support sustained growth and our pace of geographic expansion. Stefan’s 360-degree view will empower critical decisions in marketing, sales, product development, and customer service, and his deep commercial financing experience will support our pursuit of the capital needed to scale operations and capitalize on the macro trends impacting our target markets, including the recently passed Inflation Reduction Act.
“Looking forward into 2023, we are well positioned for continued execution upon the foundation that we have built. There remains plenty of work to be done, though I have never been more confident in the future of our business as I am today. I look forward to reporting on exciting milestone achievements in the months ahead as we strive to create sustainable, long-term value for our shareholders,” concluded Massey.
Third Quarter 2022 Financial Summary
Revenue in the third quarter of 2022 increased 333% to $57.3 million, as compared to $13.2 million in the third quarter of 2021.
Gross profit increased 195% to $14.2 million, or 24.8% of revenues, in the third quarter of 2022, as compared to $4.8 million, or 36.3% of total revenues, in the third quarter of 2021.
Operating expenses in the third quarter of 2022 totaled to $6.8 million, as compared to $6.2 million in the third quarter of 2021.
Net income in the third quarter of 2022 increased to $6.2 million, or $0.01 per diluted share, as compared to a net loss of $1.7 million, or $(0.00) per diluted share, in the third quarter of 2021.
Cash and cash equivalents totaled $0.5 million as of September 30, 2022, as compared to $1.1 million as of December 31, 2021.
About Solar Integrated Roofing Corp.
Solar Integrated Roofing Corp. (OTC: SIRC), is an integrated, single-source solutions provider for solar power, roofing systems and EV charging installations, specializing in commercial and residential projects throughout North America. The Company serves communities by delivering the best experience through constant innovation & legacy-focused leadership. For more information, please visit the Company's website at www.solarintegratedroofing.com or join us on Twitter.
Forward-Looking Statements
Any statements made in this press release which are not historical facts contain certain forward-looking statements; as such term is defined in the Private Security Litigation Reform Act of 1995, concerning potential developments affecting the business, prospects, financial condition and other aspects of the company to which this release pertains. The actual results of the specific items described in this release, and the company's operations generally, may differ materially from what is projected in such forward-looking statements. Although such statements are based upon the best judgments of management of the company as of the date of this release, significant deviations in magnitude, timing and other factors may result from business risks and uncertainties including, without limitation, the company's dependence on third parties, general market and economic conditions, technical factors, the availability of outside capital, receipt of revenues and other factors, many of which are beyond the control of the company. The company disclaims any obligation to update the information contained in any forward-looking statement. This press release shall not be deemed a general solicitation.
Investor Relations Contact:
Lucas A. Zimmerman
Director
MZ North America
Main: 949-259-4987
SIRC@mzgroup.us
www.mzgroup.us
SOLAR INTEGRATED ROOFING CORP.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
|
| September 30, |
|
| December 31, |
| ||
|
| 2022 |
|
| 2021 |
| ||
ASSETS |
|
|
|
|
|
| ||
Cash |
| $ | 480,141 |
|
| $ | 1,124,533 |
|
Accounts receivable, net |
|
| 5,511,696 |
|
|
| 3,652,176 |
|
Work in progress receivable, net |
|
| 76,976,192 |
|
|
| 33,242,296 |
|
Note receivable |
|
| 4,200,000 |
|
|
| 4,200,000 |
|
Prepaid and other current assets |
|
| 273,826 |
|
|
| 736,548 |
|
Inventory |
|
| 151,363 |
|
|
| 142,955 |
|
TOTAL CURRENT ASSETS |
|
| 87,593,218 |
|
|
| 43,098,508 |
|
|
|
|
|
|
|
|
|
|
OTHER ASSETS |
|
|
|
|
|
|
|
|
Operating lease right-of-use assets |
|
| 2,888,171 |
|
|
| 1,646,049 |
|
Property and equipment, net |
|
| 1,004,016 |
|
|
| 1,122,057 |
|
Goodwill |
|
| 62,047,800 |
|
|
| 58,401,851 |
|
Other assets |
|
| 154,390 |
|
|
| 265,071 |
|
TOTAL ASSETS |
|
| 153,687,595 |
|
|
| 104,533,536 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
CURRENT LIABILITIES |
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities |
| $ | 8,516,321 |
|
| $ | 7,984,710 |
|
Accrued interest |
|
| 1,519,387 |
|
|
| 1,157,113 |
|
Due to related parties |
|
| 11,204,126 |
|
|
| 11,510,413 |
|
Operating lease liabilities, current portion |
|
| 504,981 |
|
|
| 115,623 |
|
Notes payable |
|
| 21,955,667 |
|
|
| 5,112,773 |
|
Debenture payable |
|
| 2,400,000 |
|
|
| 2,400,000 |
|
Convertible note payable, net of unamortized discounts |
|
| 10,684,800 |
|
|
| 23,688,886 |
|
Derivative liabilities |
|
| 53,295 |
|
|
| 10,049 |
|
Total Current Liabilities |
|
| 56,838,577 |
|
|
| 51,979,567 |
|
|
|
|
|
|
|
|
|
|
OTHER LIABILITIES |
|
|
|
|
|
|
|
|
Note payable, long-term |
|
| 2,273,531 |
|
|
| 2,426,698 |
|
Operating lease liabilities, non-current portion |
|
| 2,383,190 |
|
|
| 1,530,426 |
|
TOTAL LIABILITIES |
|
| 61,495,298 |
|
|
| 55,936,691 |
|
|
|
|
|
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES (Note 13) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
STOCKHOLDER’S EQUITY |
|
|
|
|
|
|
|
|
Preferred stock, $0.00001 par value: authorized 25,000,041 shares |
|
| — |
|
|
| — |
|
Series A Preferred stock, $0.00001 par value: 5,000,000 shares authorized, 2,500,000 shares issued and outstanding, respectively |
|
| 25 |
|
|
| 25 |
|
Series B Preferred stock, $0.00001 par value: 20,000,000 shares authorized, 5,701,000 and 8,000,000 shares issued and outstanding, respectively |
|
| 57 |
|
|
| 80 |
|
Series C Preferred stock, $0.00001 par value: 1 share authorized, 1 share issued and outstanding, respectively |
|
| - |
|
|
| - |
|
Series D Preferred stock, $0.00001 par value: 40 shares authorized, 40 shares issued and outstanding, respectively |
|
| - |
|
|
| - |
|
Common stock, $0.00001 par value: 900,000,000 shares authorized, 542,817,941 and 453,498,555 shares issued and outstanding, respectively |
|
| 5,428 |
|
|
| 4,535 |
|
Stock payable |
|
| 2,652,300 |
|
|
| 11,790,200 |
|
Stock receivable |
|
| - |
|
|
| (36,450,000 | ) |
Additional paid-in capital |
|
| 59,570,943 |
|
|
| 74,087,246 |
|
Non-controlling interest |
|
| (415,389 | ) |
|
| (60,487 | ) |
Retained earnings (accumulated deficit) |
|
| 30,378,933 |
|
|
| (774,754 | ) |
TOTAL STOCKHOLDER’S EQUITY |
|
| 92,192,297 |
|
|
| 48,596,845 |
|
TOTAL LIABILITIES AND STOCKHOLDER’S EQUITY |
| $ | 153,687,595 |
|
| $ | 104,533,536 |
|
SOLAR INTEGRATED ROOFING CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
|
| Three Months Ended |
|
| Nine Months Ended |
| ||||||||||
|
| September 30, |
|
| September 30, |
| ||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Revenue |
| $ | 57,267,460 |
|
| $ | 13,224,759 |
|
| $ | 150,541,535 |
|
| $ | 24,674,807 |
|
Cost of Sales |
|
| 43,071,432 |
|
|
| 8,418,340 |
|
|
| 94,558,164 |
|
|
| 19,484,806 |
|
Gross Profit |
|
| 14,196,028 |
|
|
| 4,806,419 |
|
|
| 55,983,371 |
|
|
| 5,190,001 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and wages |
|
| 3,989,043 |
|
|
| 2,863,858 |
|
|
| 12,437,116 |
|
|
| 5,488,167 |
|
Professional fees |
|
| 1,400,473 |
|
|
| 1,585,673 |
|
|
| 4,499,397 |
|
|
| 4,474,413 |
|
Depreciation expense |
|
| 69,807 |
|
|
| 222,613 |
|
|
| 277,601 |
|
|
| 303,982 |
|
Marketing |
|
| 186,093 |
|
|
| 229,259 |
|
|
| 445,828 |
|
|
| 575,038 |
|
General and administrative |
|
| 1,179,561 |
|
|
| 1,275,383 |
|
|
| 3,768,121 |
|
|
| 3,136,619 |
|
Total operating expenses |
|
| 6,824,977 |
|
|
| 6,176,786 |
|
|
| 21,428,063 |
|
|
| 13,978,219 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from operations |
|
| 7,371,051 |
|
|
| (1,370,367 | ) |
|
| 34,555,308 |
|
|
| (8,788,218 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
| (1,077,710 | ) |
|
| (586,638 | ) |
|
| (2,190,637 | ) |
|
| (949,454 | ) |
Other income (expense) |
|
| - |
|
|
| (108,489 | ) |
|
| (253,707 | ) |
|
| 90,793 |
|
PPP loans forgiveness |
|
| - |
|
|
| 20,830 |
|
|
| - |
|
|
| 1,018,130 |
|
Loss on debt modification |
|
| - |
|
|
| - |
|
|
| (1,268,933 | ) |
|
| - |
|
Gain (loss) on change in fair value of derivative liabilities |
|
| (53,295 | ) |
|
| 359,009 |
|
|
| (43,246 | ) |
|
| 1,285,675 |
|
Total other income (expense) |
|
| (1,131,005 | ) |
|
| (315,288 | ) |
|
| (3,756,523 | ) |
|
| 1,445,144 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before taxes |
|
| 6,240,046 |
|
|
| (1,685,655 | ) |
|
| 30,798,785 |
|
|
| (7,343,074 | ) |
Provision for income taxes |
|
| - |
|
|
| - |
|
|
| - |
|
|
| - |
|
Net income (loss) |
|
| 6,240,046 |
|
|
| (1,685,655 | ) |
|
| 30,798,785 |
|
|
| (7,343,074 | ) |
Net income (loss) attributable to non-controlling interest |
|
| (331,918 | ) |
|
| (24,233 | ) |
|
| (354,902 | ) |
|
| (40,415 | ) |
Net income (loss) attributable to the Company |
| $ | 6,571,964 |
|
|
| (1,661,422 | ) |
| $ | 31,153,687 |
|
|
| (7,302,659 | ) |
Basic income (loss) per Common Share |
| $ | 0.01 |
|
| $ | (0.00 | ) |
| $ | 0.06 |
|
| $ | (0.02 | ) |
Diluted income (loss) per Common Share |
| $ | 0.01 |
|
| $ | (0.00 | ) |
| $ | 0.06 |
|
| $ | (0.02 | ) |
Basic weighted average number of common shares outstanding |
|
| 539,902,975 |
|
|
| 378,468,171 |
|
|
| 502,470,756 |
|
|
| 343,348,974 |
|
Diluted weighted average number of common shares outstanding |
|
| 616,917,439 |
|
|
| 481,083,476 |
|
|
| 579,485,220 |
|
|
| 445,964,279 |
|
SOLAR INTEGRATED ROOFING CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
|
| For the Nine Months Ended |
| |||||
|
| September 30, 2022 |
|
| September 30, 2021 |
| ||
|
|
|
|
|
|
| ||
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
| ||
Net income (loss) |
| $ | 30,798,785 |
|
| $ | (7,343,074 | ) |
Adjustments to reconcile net income (loss) to net cash used in operating activities: |
|
|
|
|
|
|
|
|
Stock-based compensation |
|
| 3,260,418 |
|
|
| 928,650 |
|
Loss on debt modification |
|
| 1,268,933 |
|
|
| - |
|
Amortization of debt discount |
|
| 6,724 |
|
|
| 186,146 |
|
(Gain) Loss on change in fair value of derivative liabilities |
|
| 43,246 |
|
|
| (1,285,675 | ) |
Depreciation |
|
| 277,601 |
|
|
| 303,982 |
|
Warrant expense |
|
| 147,500 |
|
|
| - |
|
Stock option expense |
|
| 1,259,300 |
|
|
| - |
|
PPP loans forgiveness |
|
| - |
|
|
| (1,018,130 | ) |
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Accounts and work in progress receivable |
|
| (45,593,416 | ) |
|
| (2,456,396 | ) |
Prepaid expenses and other assets |
|
| 462,722 |
|
|
| (617,892 | ) |
Inventory |
|
| (8,408 | ) |
|
| 141,162 |
|
Accounts payables and accrued liabilities |
|
| 2,773,650 |
|
|
| 1,734,326 |
|
Due to related parties |
|
| (306,287 | ) |
|
| 8,104,145 |
|
Net Cash Used in Operating Activities |
|
| (5,609,232 | ) |
|
| (1,322,756 | ) |
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
|
|
Net cash paid in acquisition of subsidiaries |
|
| (600,000 | ) |
|
| (10,100,000 | ) |
Purchase of property and equipment |
|
| (159,560 | ) |
|
| (1,112,644 | ) |
Net Cash Used in Investing Activities |
|
| (759,560 | ) |
|
| (11,212,644 | ) |
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
|
Proceeds from notes payable |
|
| 5,452,105 |
|
|
| 6,813,218 |
|
Repayments of notes payable |
|
| (2,762,245 | ) |
|
| (1,841,218 | ) |
Proceeds from convertible notes payable |
|
| 2,440,000 |
|
|
| 21,055,610 |
|
Proceeds from warrant exercise |
|
| - |
|
|
| 16,480 |
|
Repurchase of preferred stock class B |
|
|
|
|
|
| (10,000,000 | ) |
Repurchase of common stock |
|
|
|
|
|
| (100,000 | ) |
Proceeds from sale of common stock |
|
| 594,540 |
|
|
| 140,000 |
|
Net Cash Provided by Financing Activities |
|
| 5,724,400 |
|
|
| 16,084,090 |
|
|
|
|
|
|
|
|
|
|
Net change in cash and cash equivalents |
|
| (644,392 | ) |
|
| 3,548,690 |
|
Cash and cash equivalents, beginning of period |
|
| 1,124,533 |
|
|
| 710,091 |
|
Cash and cash equivalents, end of period |
| $ | 480,141 |
|
| $ | 4,258,781 |
|
|
|
|
|
|
|
|
|
|
Supplemental cash flow information |
|
|
|
|
|
|
|
|
Cash paid for interest |
| $ | - |
|
| $ | - |
|
Cash paid for taxes |
| $ | - |
|
| $ | - |
|
|
|
|
|
|
|
|
|
|
Non-cash investing and financing transactions: |
|
|
|
|
|
|
|
|
Issuance of common stock for conversion of debt and accrued interest |
| $ | 2,840,575 |
|
| $ | 1,398,647 |
|
Common stock issued for acquisition of subsidiaries |
| $ | 12,011,849 |
|
| $ | 63,532,400 |
|
Modification of convertible notes in exchange for promissory note |
| $ | 14,000,000 |
|
| $ | - |
|
Acquisition of subsidiary via issuance of preferred stock class B |
| $ | - |
|
| $ | 4,870,000 |
|
Net assets acquired in acquisition |
| $ | - |
|
| $ | 1,007,535 |
|
Assets acquired from financing |
| $ | - |
|
| $ | 54,807 |
|
Net assets acquired in acquisitions |
| $ | - |
|
| $ | 866,000 |
|
Return and cancellation of common stock |
| $ | 36,450,000 |
|
| $ | - |
|
Right-of-use assets and corresponding liabilities on new building leases |
| $ | 1,454,939 |
|
| $ | - |
|
