Flux Power: ‘probability’ of $100M + orders in FY24, secures new credit facility

Flux Power Holdings (FLUX) issued a letter to shareholders from Ron Dutt, CEO of Flux Power. Added 8 new customers in 2023, reflecting customers desire to fulfill long-term fleet needs of replacing lead acid battery packs with lithium-ion. Expansion of Gross Margins Leading to Profitability in FY2024..Strategic Supply Chain & Profitability..Improvement Initiatives continued to accelerate the path to cash flow breakeven. ..Secured a new $15M credit facility, with expansion capability to $20M, from Gibraltar Business Capital to fund working capital and to repay its existing credit facility with Silicon Valley Bank (SIVBQ) .Secured a new $2M subordinated line of credit with Cleveland Capital providing additional credit support with an extended duration to A Customer order backlog of $31.1M as of November 2, ..To meet the demanding needs of our customers with cutting-edge solutions, we continued to innovate our products and capabilities and expand our reach into new applications…Our significant backlog of open orders supports our strategy, along with a pipeline of high probability orders of over $100M ahead of us in 2024. In 2023 we took significant actions to strengthen our capital structure while managing our business growth and margin expansion with careful priorities as part of our strategy to enhance shareholder value. We migrated from our Silicon Valley Bank facility to a new $15M credit facility with Gibraltar Business Capital, which provides lower interest rates, a two-year term, and the potential to expand the facility to $20M to accommodate higher working capital needs as our business grows. This facility, along with our improvement in operating cash performance, supports our current business growth. An additional $2.0 million subordinated line of credit with Cleveland Capital provides greater working capital optionality beyond our projected needs and continued confidence in our growth strategy from a long-term investor in Flux Power. As we look to the future, we believe it is good corporate practice to have replaced our previous shelf registration as this allows the Company maximum flexibility with respect to our capital management.