Beam Global (NASDAQ:BEEM) Q1 2023 Earnings Conference Call May 15, 2023 4:30 PM ET

Company Participants

Kathy McDermott - Chief Financial Officer

Desmond Wheatley - Chairman, Chief Executive Officer & President

Conference Call Participants

Tyler DiMatteo - BTIG

Christopher Souther - B.Riley

Noel Parks - Tuohy Brothers Investment Research

Abhishek Sinha - Northland Capital

Tate Sullivan - Maxim Group

Chris Pierce - Needham & Company

Operator

Good day, and welcome to the Beam Global First Quarter 2023 Financial Results and Corporate Update. [Operator Instructions] Please note that this event is being recorded.

I would now like to turn the call over to the Chief Financial Officer, Kathy McDermott. Please go ahead.

Kathy McDermott

Thanks, Joe. Good afternoon, everyone, and thank you for participating in Beam Global 2023 first quarter conference call. We appreciate you joining us today and hearing an update on our business. Joining me is Desmond Wheatley, President, CEO and Chairman of Beam. Desmond will be providing an update on recent activities at Beam followed by a question-and-answer session.

But first, I'd like to communicate to you that during this call, management will be making forward-looking statements including statements that address team's expectations for future performance or operational results. Forward-looking statements involve risks and other factors that may cause actual results to differ materially from those statements. For more information about these risks, please refer to the risk factors described in Beam's most recent filed Form 10-K and other periodic reports filed with the SEC. The content of this call contains time-sensitive information that is accurate only as of today, May 15, 2023. Except as required by law, Beam disclaims any obligation to publicly update or revise any information to reflect events or circumstances that occur after this call.

And next, I will provide you with the financial results for Beam's first quarter of 2023. Our first quarter revenue started out very strong increasing 245% over the first quarter of 2022 and 65% over the prior fourth quarter of 2022, which is typically our highest quarter. Revenues for the quarter ended March 31, 2023 was $13 million compared to $3.8 million in the same quarter in the prior year. The increase can be attributed to the increase in federal sales primarily to the U.S. Army as a result of several large federal orders we received in late 2022 that we'll deliver through the end of 2023.

Our manufacturing operations have increased our production capacity by increasing our production team, close management of our supply chain and through improved tooling and design changes to allow us to fulfill this higher demand for our products. After many quarters of reporting a gross loss, we're happy to report a gross profit for the quarter ended March 31, 2023, our gross profit was $5,000 [ph] compared to a loss of $0.3 million or 8.1% [ph] of sales for the first quarter of 2022. This improvement resulted from the increased production levels, providing favorable fixed overhead absorption and improved labor efficiency. Our material cost for steel and other components remain higher than Q1 2022 and due to supply chain shortages and other inflationary pressures. Also, our cost of goods sold includes $0.2 million of noncash intangible amortization related to purchase assets from the AllCell acquisition.