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Cemtrex Q1 2025 Earnings Report
Cemtrex reported a decrease in revenue and net loss for Q1 2025, primarily due to unexpected delays in security technology product orders, partially offset by increased demand in industrial services.
Key Takeaways
Cemtrex, Inc. reported a total revenue of $13,739,899 for the three months ended December 31, 2024, a decrease from $16,878,166 in the same period last year. The company experienced a net loss of $28,934,519, compared to a net loss of $1,303,903 in the prior year, largely driven by losses on warrant liabilities. Diluted EPS for continuing operations was -$16.15.
Total revenue decreased by 18.59% to $13,739,899 in Q1 2025 from $16,878,166 in Q1 2024.
Net loss significantly widened to $28,934,519 in Q1 2025 from $1,303,903 in Q1 2024, primarily due to losses on warrant liabilities.
Security segment revenue decreased by 41% due to unexpected delays in orders, while Industrial Services revenue increased by 7% due to increased demand.
The company's working capital decreased to $4,130,393 from $8,103,457, mainly due to an increase in current maturities of long-term debt and accrued expenses.
Cemtrex
Cemtrex
Cemtrex Revenue by Segment
Revenue by Segment
Security Segment Revenue
CapyFin.comIndustrial Services Segment Revenue
CapyFin.com Forward Guidance
The company's working capital may not be sufficient to cover operating costs, indicating substantial doubt about its ability to continue as a going concern. While the company has secured a line of credit, is reevaluating its pricing model, and has completed equity financing, there is no guarantee that these plans will be sufficient to meet capital demands or that cash flow from operations will be adequate.
Positive Outlook
- Secured a line of credit for its Vicon brand to fund operations, with available capacity of $903,102 as of December 31, 2024.
- Continually reevaluating pricing model on Vicon brand to improve margins and introducing new innovative products to grow revenues.
- Raised $9,039,959 in net proceeds through May 2024 equity financing and anticipates up to $10 million when Series B warrants are exercised.
- Effected 60:1 and 35:1 reverse stock splits to remain trading on Nasdaq Capital Markets and improve ability to raise capital.
- Company believes that if successful, these plans would be sufficient to meet capital demands for at least the next twelve months.
Challenges Ahead
- Working capital may not be sufficient to cover operating costs, raising substantial doubt about the company's ability to continue as a going concern.
- No guarantee that additional capital raised through equity offerings and/or debt will be sufficient to meet working capital needs.
- Issuance of common stock to satisfy liabilities may have a dilutive effect on existing stockholders.
- No guarantee that cash flow from existing or future operations will be sufficient to meet working capital needs.
- Company currently does not have adequate cash or available liquidity/capacity on lines of credit to meet long-term needs.
Revenue & Expenses
Visualization of income flow from segment revenue to net income