Acorn Energy reports Q3 EPS 1c vs. (8c) last year

Reports Q2 revenue $2.09M vs. $1.78M last year.Jan Loeb, Acorn’s CEO, commented, “Acorn achieved its second consecutive quarter of positive cash flow and net income in Q3’23 with a 17% increase in total revenue, demonstrating the strength and resiliency of our value proposition and the growing scale of our recurring revenue model. Our performance was achieved despite $102,000 of one-time expenses related to the 1-for-16 reverse split successfully completed during the quarter. As we have noted, the reverse split was intended to make our common stock accessible to a broader base of investors. Given our strong operating results, growth outlook and sound financial position, we believe Acorn has reached the point where we could benefit from a materially higher share price, while also better positioning our company for our longer-term goal of up-listing to a major exchange. Importantly, our recurring high-margin monitoring revenue continues to gain momentum, increasing 13% in Q3’23 and 9% year-to-date, and we expect this momentum to continue into 2024. Our Q3’23 gross margin returned to a more typical level of 74%, up from 68% in Q3’22 which reflected the year-ago impact of inventory obsolescence related to the sunsetting of 3G monitoring units and the healthy rebound in our monitoring revenue this year. Given the revenue and gross margin improvements, Q3’23 gross profit grew 28% over Q3’22. Importantly, Acorn was able to report a net profit for the third quarter and first nine months of 2023, and we believe we are on track to achieve more meaningful profitability in future periods. Given Acorn’s net operating loss carryforwards of over $70M, future profits would be largely shielded from tax liability, potentially further benefitting our cash flows. In Q3’23, our cash-basis revenue declined 12% vs. Q3’22, following 33% growth in Q2. Some of this relates to weakness from residential generator dealers sales due to higher interest rates and some of it is due to the timing of larger commercial and industrial orders. Our long-term goal remains the achievement of 20% average annual top-line growth. Although we are below that level on year-to-date basis in 2023, we have a range of business development initiatives in process that we believe should help us reach that goal going forward. Underlying our growth objectives are the substantial efficiency, cost reduction, risk mitigation and environmental benefits that our solutions provide to both commercial and residential customers.