OXE Marine AB (publ) Interim report 1 January to 31 March 2023

OXE Marine AB (publ)
 

Interim Report January - March 2023

First Quarter 2023

• Consolidated Net turnover amounted to SEK 32.8 m (SEK 31.4 m).

• Consolidated Gross Profit amounted to SEK 8.2 m (SEK 9.0 m) with a gross margin of 25% (29%).

• Consolidated EBITDA amounted to SEK -17.3 m (SEK -12.9 m).

• The consolidated result for the quarter amounted to SEK -27.5 m (SEK -23.5 m).

• Consolidated EPS and Diluted EPS amounted to SEK -0.09 (SEK -0.10).

Significant events during the First quarter

• OXE Marine presented a new concept outboard OXE hybrid 450, the world’s first diesel electric hybrid outboard.

• OXE Marine's water jet engine was nominated for innovation of the year at the Miami international boat show.

• OXE Marine expand their footprint in Asia by appointing Creation Co., Ltd as dealers for Japan.

Significant events after the reporting period

• OXE Marine introduced the OXE configurator, that allows the customers to customize their OXE Diesel Outboard.

• OXE Marine expands in South America by appointing new distributors in Brazil and Colombia

* Refer to section Definitions of Key Business Ratios, Diluted Earnings Per Share.

 

A word from the CEO

Grit will pay off

“Following the challenging end of Q4 we move into Q1 with one and only focus – to execute on our plan to be able to produce and deliver new upgraded engines solving the technical challenges experienced in specific geographical areas and in specific applications. This we have now done thanks to excellent work by our team and in close collaboration with our partners.”

We can be clear – during the last 12 months and thanks to our company being in much closer contact to our users, we have learned a lot about specific applications where we must improve – “the devil is in the details”. This has led to a program where we have made technical upgrades and initiated a program to develop service, support and availability, and these upgrades were all completed during March where at the end of March we delivered fully upgraded engines to the customers requiring these additional features. Basically, all deliveries in Q1 took place during the last two weeks of the quarter – showing the potential in our organization and how we now can perform together with our partners. In retrospect, we learnt from this and how to be faster in implementing enhancements to our products, but we can also conclude that with the extra testing and focus on establishing solid supply chain solutions – it takes time. Our approach to product development has significantly improved, as it is carried out in close collaboration with customers. We see now, with our upgrades, extremely good improvements and performance, and we are carrying out these upgrades now in production and in the field. In addition to this, during the quarter we continued to strengthen our service and support area, improving the Parts & Accessories (P&A) supply chain with clear results and also established ourselves in South East Asia with very experienced colleagues now present locally. This means we will be established with our own companies and teams in USA, Europe and South East Asia, and able to work even closer with customers, providing support and service. This will also create a sustainable “growth platform” as well as support the plans of extending the product range with not only upgrades and enhancements, but also new products and an improved supply chain.

During the quarter we delivered our first water jets as previously promised. The jet is developed to maximize the high torque of OXE outboard engines through a more effective design, delivering 100% of engine horsepower in water jet propulsion. We also continued to execute on the development program to commercialize the world’s first high-power diesel electric outboard motor – the OXE Hybrid 450, with technological advancements driven by our patented lower leg design able to manage high torque and power.

Our overall sales performance during the quarter followed the deliveries of the upgraded engines towards the end of the quarter and consolidated sales amounted to SEK 32.8 m, which was a 5% increase relative to the same quarter of the previous year. Our gross margin amounted to 25%. The Company increased its provision for warranties, which had a one-time impact. Excluding the increase in provision, the gross margin would have amounted to 28%. In addition a portion of sales generated in the P&A segment related to industrial sales (see below) at lower margins, which put further downward pressure on the gross margin. We continue to focus our resources carefully in what will grow the business, continue to be active at trade shows as well as increase the awareness of our products through targeted marketing channels. It is very encouraging to see the growth of the OXE brand online with exponential growth in social media views and organic reach.

P&A segment continue to grow, consolidated sales amounted to SEK 13.9 m for the quarter. an increase of 157% compared to the same quarter of the previous year. Included in P&A sales was SEK 3.8m in industrial sales during the quarter which have been included in this segment. Industrial sales relate to sales of engine blocks and is to reduce inventory levels of the GM blocks in inventory. Excluding the industrial sales, P&A would have amounted to SEK 10.1 m which still amounts to an 87% increase in P&A compared to the previous year and the best quarter in OXE Marine’s history for this segment. We still only see the beginning of this journey.

We continue to be ambitious in our approach, positioning our “transition technology” in the marine industry. We already today probably deliver the world’s most environmentally friendly highperformance outboard engine. The interest is growing, and with several innovations in the pipeline, together with the continued focus on our existing product range, we see more and more clearly the path to profitability. We are more committed than ever to delivering technically innovative upgrades to our current product families and carry this out with speed and execution.

As we strive to create the most attractive partner in our industry, we also add dealers and distributors, and during the quarter we had deliveries to several new customers as well as signed up new dealers. All in all, a quarter where we closed the quarter with high focus and speed, and from this point – we will just continue to develop and work hard.

Anders Berg, CEO

This disclosure contains information that OXE Marine AB is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the agency of the contact person, on 02-05-2023 07:00 CET.