Lendway, Inc. Reports Financial Results for the Quarter Ended June 30, 2024
Lendway, Inc. (LDWY) reported its quarterly financial results for the period ended June 30, 2024. The company’s condensed consolidated balance sheet as of June 30, 2024, showed total assets of $X million and total liabilities of $Y million, resulting in a net loss of $Z million. The company’s revenue for the three months ended June 30, 2024, was $X million, a decrease of Y% compared to the same period in 2023. Net loss for the three months ended June 30, 2024, was $Z million, compared to a net loss of $W million in the same period in 2023. The company’s cash and cash equivalents as of June 30, 2024, were $X million.
Company Overview
The Company is a specialty agricultural company focused on making and managing its agricultural investments in the United States and internationally. In August 2023, the Company completed the sale of its In-Store Marketing Business for $3.5 million. In February 2024, the Company acquired majority ownership in Bloomia B.V., a leading producer of fresh cut tulips in the United States.
Bloomia Business
Bloomia purchases tulip bulbs, hydroponically grows tulips from the bulbs, and sells the stems to retail stores. Bloomia nurtures over 75 million tulip stems annually and had net sales of approximately $45 million and $43 million in 2023 and 2022, respectively. The Company acquired Bloomia for $53.36 million, funded through a combination of debt and cash.
Former Lending Business
The Company had previously planned to develop a non-bank lending business, but after the resignation of the CEO who had expertise in this area, the Company decided to focus solely on the agricultural business.
Results of Operations
In the three and six months ended June 30, 2024, the Company reported revenue of $16.78 million and $24.81 million, respectively, all from the Bloomia business. Gross profit was 23.7% of revenue. Operating expenses increased due to the Bloomia acquisition, including $652,000 in integration costs. The Company recorded an income tax benefit due to the reversal of a valuation allowance on deferred tax assets.
Non-GAAP Financial Measures
The Company reported EBITDA of $690,000 and $(468,000) for the three and six months ended June 30, 2024, respectively.
Liquidity and Capital Resources
The Company financed the Bloomia acquisition through a combination of debt and cash. As of June 30, 2024, the Company had $1.72 million in cash and $5.82 million in working capital. The Company expects that cash from operations and available credit facilities will provide sufficient liquidity for at least the next 12 months.
Critical Accounting Estimates
The Company’s critical accounting estimates include inventory valuation, accounting for business combinations, impairment of goodwill and intangible assets, and income taxes. These estimates involve significant judgment and assumptions that could materially impact the financial statements.
Cautionary Statement Regarding Forward-Looking Statements
The report includes forward-looking statements regarding the Company’s liquidity, ability to integrate Bloomia, and other factors that could cause actual results to differ materially from the forward-looking statements.
