CORRECTION: OXE Marine AB (publ) Interim report 1 October to 31 December 2023
Today, on 29 February 2024, OXE Marine AB published a press release stating that the company had released the Interim Report October - December 2023. The press release contained an error which is corrected. The full year figures for January to December 2023 have not changed and the error relates to the "goods for resale" figure for Q4 2023 which has been restated. The error relates to a consolidation journal entry which is updated. Accordingly, the income statement relating to the parent company is not impacted. The error impacted the “goods for resale” on the income statement which was previously stated as SEK -40.427m and has been corrected to SEK -48.298m. Accordingly gross profit has been restated to SEK 14.365m (23% gross margin) and was previously SEK 22.236m (35% gross margin). All other totals in the consolidated income statement have been updated accordingly. Regarding the consolidated statement of cash flows, the results before financial items has been corrected and is SEK -20.217m and was previously stated SEK -12.346m. The report and relevant commentary has been updated and is attached.
OXE Marine AB (publ)
Fourth Quarter 2023
· Consolidated Net turnover amounted to SEK 62.7 m (SEK 32.1 m).
· Consolidated Gross Profit amounted to SEK 14.4 m (SEK 3.4 m) with a gross margin of 23% (11%).
· Consolidated EBITDA amounted to SEK -12.8 m (SEK -31.1 m).
· The consolidated result for the quarter amounted to SEK -18.5 m (SEK -45.7 m).
· Consolidated EPS and Diluted EPS amounted to SEK -0.06 (SEK -0.17).
January - December 2023
· Consolidated Net turnover amounted to SEK 189.6 m (SEK 148.4 m).
· Consolidated Gross Profit amounted to SEK 38.2 m (SEK 32.2 m) with a gross margin of 20% (22%).
· Consolidated EBITDA amounted to SEK -78.0 m (SEK -60.9 m).
· The consolidated result for the period amounted to SEK -116.4 m (SEK -109.9 m).
· Consolidated EPS and Diluted EPS amounted to SEK -0.38 (SEK -0.43).
Significant events during the fourth quarter
· OXE Marine carried out a directed share issue of SEK 30.2 million.
· OXE Marine announced collaboration with control system manufacturer Uflex.
Significant events during the year
· OXE Marine received orders worth SEK 63 m (USD 5.8 m) to supply a United States Governmental Agency.
· OXE Marine received an order from its exclusive distributor in the Philippines of approximately SEK 9 m (EUR 0.9 m) as a result of an award from the Philippines Coast Guard, total scope 80 engines.
· OXE Marine received orders worth SEK12M (USD1.1M) from United States DLA.
· OXE Marine appointed Paul Frick as new CEO.
· OXE Marine carried out a directed share issue of SEK 30.2 million.
· OXE Marine announced collaborations with Punch Torino and control system manufacturer Uflex.
· OXE Marine's water jet engine was nominated for innovation of the year at the Miami international boat show.
· OXE Marine presented a new concept outboard OXE hybrid 450, the world’s first diesel electric hybrid outboard.
· OXE Marine expands in North America by appointing new distributor in Mexico, South America by appointing new distributors in Brazil and Colombia, and in Asia by appointing Creation Co., Ltd as dealers for Japan.
· OXE Marine introduced the OXE configurator, that allows the customers to customize their OXE Diesel Outboard.
Significant events after the reporting period
· OXE Marine signed distributor agreement with SARJ in Sweden and Finland.
· OXE Marine signed distributor agreement with Bota Technik in Poland.
A word from the CEO
RECORD SALES DURING THE QUARTER
“This was the highest revenue achieved during a quarter, boosted by higher P&A deliveries. Overall, the quarter shows operational improvements compared to previous quarters.”
There was a 95% increase in total sales for the quarter which amounted to SEK 62.7 m (SEK 32.1 m) on a consolidated basis. Going into Q4, we were expecting a strong quarter due to the delivery of a large portion of the USD 5.8m US Governmental Agency order. Approximately 58% was recognised during the quarter with 23% of the order outstanding and with the majority expected to be recognised during 2024. With regards to the order to supply our customer in the Philippines, no deliveries took place during Q4 in accordance with the delivery plan. The remaining approximately 50% of the outstanding 80-engine order to the Philippines Coast Guard will be delivered during the first half of 2024. On the back of these two milestone orders, we have continued to see a growing interest in our products from the governmental segment.
Gross Profit for the quarter increased 319% relative to the same quarter of the previous year. Gross margin amounted to 23% during the quarter (11%). During the quarter there was a one-off inventory adjustment relating to the opening inventory balance going into the quarter, amounting to SEK -4.4 m. Excluding this one-off adjustment, the gross margin for the quarter would have amounted to 30%. During the quarter there was a larger proportion of P&A sales which contributed positively to the gross margin, however this was offset by higher costs of sales in freight costs, price increases from suppliers and increased warranty costs during the quarter.
EBITDA for the quarter amounted to SEK -12.8 m (SEK -31.1 m) representing an improvement of SEK 18.3 m relative to the same quarter of the previous year. EBITDA excluding forex movements and one-off adjustments amounted to SEK -9.7 m (SEK -17.0 m) for the quarter, representing a SEK 7.3 m improvement relative to the same quarter of the previous year (refer to the graph “EBITDA excluding forex movements and one-off adjustments” below). We do see a general improvement in our operating results when comparing with the previous quarters and continue to focus on achieving breakeven.
Operating expenses were SEK -29.1 m for the quarter (SEK -31.1 m). The organisation is lean with a high focus on productivity and adding value to our customers. There were 47 people in the organisation at the end of 2022 and 51 at the end of 2023. During the year, OXE opened a representative office in Singapore consisting of two full time employees to be closer to the growing Asian market. The size of the global technical service and support team to support the aftermarket has grown during the year with the team consisting of 10 in technical service and support. Our aim is to consistently increase the knowledge of OXE products and have significantly ramped up in the number of training courses held several times a quarter.
Parts & Accessories contributed 57% (15%) of total revenue during the fourth quarter with sales amounting to SEK 35.6 m (SEK 9.4 m). Delivery of P&A to the population of OXE outboards in the market remained strong and was boosted by delivery of the US Governmental order. When looking at delivery of orders in 2023 relative to 2022, the company has approximately doubled the number of SKU’s it completed.
The two main R&D projects relate to the OXE Jet-tech and the OXE Hybrid projects. Progress was made during the quarter on the several OXE Jet-Tech beta tested units currently operating on the water. The hybrid project has also continued, with patent approval received for OXE’s unique concept. We continue to see high demand for both these areas of innovation with increased focus in 2024 on getting these projects to market.
The company invested in a new digital backbone by way of a new ERP system, customer portal, technical support ticketing system and CRM system all based on the Microsoft platform. Even though there is a high level of activity in the company, we still decided to prioritize this investment to handle the growth trajectory the company is on. We went live with the ERP system in the US during the second half of 2023 and went live with the new customer portal at the beginning of 2024. We are confident the new digital platform will support future growth while offering more visibility and functionality to our customers.
During the quarter we carried out a directed share issue of SEK 30.2 m. We are extremely grateful to the supportive shareholders of OXE who continue to support the company and we will continue the hard work to consistently reach new heights. Lastly, I would like to thank the hard-working employees of OXE who continue to show discipline and dedication in taking the company to new heights.
Paul Frick, CEO
For further information, please contact:
Paul Frick, CEO, OXE Marine AB, [email protected], +46 70 325 06 20
Jonas Wikström, Chair of the Board, [email protected], +46 70 753 65 66
Certified Adviser FNCA Sweden AB is Certified Adviser for OXE Marine AB (publ).
OXE Marine AB (publ) (NASDAQ STO: OXE) is the company behind the world’s first high-performance diesel outboard. The company’s unique and patented solutions for high torque transmission between powerhead and lower leg has led to a global high demand for the company’s outboards. OXE Marine is on a journey to make life at sea prosperous for people and planet.