PublicSquare Reports Second Quarter 2024 Financial Results
Increased Second Quarter 2024 Net Revenue by over 11x YoY
Second Quarter 2024 Net Revenue Exceeds Full Year 2023 Net Revenue
Company Presents Forward Vision for New Payments Business
Signed Agreement for
SECOND HALF 2024 OUTLOOK
Looking ahead into the remainder of 2024, the Company expects to hit several significant milestones and make certain strategic changes throughout its business. Most significantly, the Company will formally launch its payments platform, for which it already has over
In light of the enhanced focus on its financial technology stack and the synergies that are materializing between the Marketplace and Financial Technology, the Company intends to sunset the brand name “Credova” and consolidate the branding, marketing, and product features under the name “PublicSquare”.
The Company’s Brands segment will launch EveryLife soaps & lotions in the third quarter of 2024, expanding its product offerings into a vertical the Company’s consumers have been demanding, followed in the fourth quarter by the addition of a training pants line and the international expansion of the EveryLife brand to
LOCK-UP AGREEMENT EXTENSION
Chairman and CEO
SECOND QUARTER 2024 HIGHLIGHTS
- Net revenue increased 1,030%, and cash flow operating expenses only rose 49% compared to the second quarter 2023
-
Increased net revenue (net of returns & discounts) by 73% quarter over quarter to
$6.0 million compared to$3.5 million in the first quarter 2024 - Gross Margin increased to 67% in the second quarter of 2024 compared to 43% in the first quarter 2024
-
Dusty Wunderlich was promoted to Chief Strategy Officer of PublicSquare; prior to this role, Dusty was the President of Credova -
Mike Hebert was promoted to Chief Operating Officer of PublicSquare; prior to this role, Mike wasChief People Officer of PublicSquare
SUBSEQUENT EVENTS
-
On
August 13, 2024 ,Randy Carlson was promoted to Chief Technology Officer of PublicSquare; prior to this role, Randy was Senior Vice President of Engineering
Second Quarter 2024 Prepared Remarks & Discussion
Management will host prepared remarks today at
About PublicSquare
PublicSquare is America's leading commerce and payments ecosystem, valuing life, family, and liberty. PublicSquare operates under three segments: Marketplace, Financial Technology, and Brands. The primary mission of the Marketplace segment is to help consumers “shop their values” and put purpose behind their purchases. PublicSquare leverages data and insights from the Marketplace to assess its customers’ needs and provide wholly-owned quality financial products and brands. PublicSquare’s Financial Technology segment comprises Credova, a consumer finance company, and PublicSquare Payments, a payments processing company. PublicSquare’s Brands segment comprises EveryLife, a premium D2C life-affirming baby products company, and PSQLink, a digital marketing and customer relationship management (“CRM”) platform.
Cautionary Statement Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended, and for purposes of the “safe harbor” provisions under the United States Private Securities Litigation Reform Act of 1995. Any statements other than statements of historical fact contained herein are forward-looking statements. Such forward-looking statements include, but are not limited to, expectations, hopes, beliefs, intentions, plans, prospects, financial results or strategies regarding PublicSquare, anticipated product launches, our products and markets, future financial condition, expected future performance and market opportunities of PublicSquare. Forward-looking statements generally are identified by the words “anticipate,” “believe,” “could,” “expect,” “estimate,” “future,” “intend,” “may,” “might,” “strategy,” “opportunity,” “plan,” “project,” “possible,” “potential,” “project,” “predict,” “scales,” “representative of,” “valuation,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions, and in this press release, include statements about our anticipated launch of our payments platform and its anticipated GMV, the expansion of our EveryLife product line, including our expansion to
PSQ HOLDINGS, INC. (dba PublicSquare) Condensed Consolidated Balance Sheets |
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2024 |
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2023 |
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(Unaudited) |
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Assets |
|
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|
|
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Current assets |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
7,613,430 |
|
|
$ |
16,446,030 |
|
Restricted cash |
|
|
136,488 |
|
|
|
- |
|
Accounts receivable, net |
|
|
340,594 |
|
|
|
204,879 |
|
Loans held for investment, net of allowance for credit losses of |
|
|
4,342,928 |
|
|
|
- |
|
Interest Receivable |
|
|
358,270 |
|
|
|
- |
|
Inventory |
|
|
1,277,709 |
|
|
|
1,439,182 |
|
Prepaid expenses and other current assets |
|
|
2,783,388 |
|
|
|
3,084,576 |
|
Total current assets |
|
|
16,852,807 |
|
|
|
21,174,667 |
|
Loans held for investment, net of allowance for credit losses of |
|
|
572,182 |
|
|
|
- |
|
Property and equipment, net |
|
|
339,113 |
|
|
|
127,139 |
|
Intangible assets, net |
|
|
15,858,943 |
|
|
|
3,557,029 |
|
|
|
|
10,930,978 |
|
|
|
- |
|
Operating lease, right-of-use assets |
|
|
456,795 |
|
|
|
324,238 |
|
Deposits |
|
|
49,617 |
|
|
|
63,546 |
|
Total assets |
|
$ |
45,060,435 |
|
|
$ |
25,246,619 |
|
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|
|
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Liabilities and stockholders’ equity |
|
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Current liabilities |
|
|
|
|
|
|
|
|
Revolving line of credit |
|
$ |
3,507,574 |
|
|
$ |
- |
|
Accounts payable |
|
|
3,923,344 |
|
|
|
1,828,508 |
|
Accrued expenses |
|
|
1,118,867 |
|
|
|
1,641,553 |
|
Deferred revenue |
|
|
241,784 |
|
|
|
225,148 |
|
Operating lease liabilities, current portion |
|
|
243,609 |
|
|
|
310,911 |
|
Total current liabilities |
|
|
9,035,178 |
|
|
|
4,006,120 |
|
Convertible promissory notes, related party (Note 12) |
|
|
10,000,000 |
|
|
|
- |
|
Convertible promissory notes |
|
|
8,449,500 |
|
|
|
- |
|
Warrant liabilities |
|
|
4,807,500 |
|
|
|
10,130,000 |
|
Earn-out liabilities |
|
|
320,000 |
|
|
|
660,000 |
|
Operating lease liabilities |
|
|
218,622 |
|
|
|
16,457 |
|
Total liabilities |
|
|
32,830,800 |
|
|
|
14,812,577 |
|
Commitments and contingencies (Note 16) |
|
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|
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Stockholders’ equity |
|
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|
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Preferred stock, |
|
|
- |
|
|
|
- |
|
Class A Common stock, |
|
|
2,817 |
|
|
|
2,441 |
|
Class |
|
|
321 |
|
|
|
321 |
|
Additional paid in capital |
|
|
98,251,713 |
|
|
|
72,644,419 |
|
Accumulated deficit |
|
|
(86,025,216 |
) |
|
|
(62,213,139 |
) |
Total stockholders’ equity |
|
|
12,229,635 |
|
|
|
10,434,042 |
|
Total liabilities and stockholders’ equity |
|
$ |
45,060,435 |
|
|
$ |
25,246,619 |
|
PSQ HOLDINGS, INC. (dba PublicSquare) Condensed Consolidated Statements of Operations (Unaudited) |
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For the Three Months Ended
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For the Six Months Ended
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2024 |
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2023 |
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2024 |
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2023 |
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Revenues, net |
|
$ |
5,985,228 |
|
|
$ |
529,707 |
|
|
$ |
9,451,117 |
|
|
$ |
907,741 |
|
Costs and expenses: |
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|
|
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Cost of revenue (exclusive of depreciation and amortization expense shown below) |
|
|
531,098 |
|
|
|
432,934 |
|
|
|
1,129,459 |
|
|
|
795,907 |
|
Cost of goods sold (exclusive of depreciation and amortization expense shown below) |
|
|
1,438,843 |
|
|
|
- |
|
|
|
2,830,251 |
|
|
|
- |
|
General and administrative |
|
|
10,993,793 |
|
|
|
3,895,467 |
|
|
|
21,256,671 |
|
|
|
7,987,317 |
|
Sales and marketing |
|
|
5,090,331 |
|
|
|
2,402,783 |
|
|
|
9,772,969 |
|
|
|
3,068,840 |
|
Research and development |
|
|
1,031,794 |
|
|
|
288,484 |
|
|
|
2,173,752 |
|
|
|
536,984 |
|
Depreciation and amortization |
|
|
930,874 |
|
|
|
699,237 |
|
|
|
1,227,471 |
|
|
|
1,244,574 |
|
Total costs and expenses |
|
|
20,016,733 |
|
|
|
7,718,905 |
|
|
|
38,390,573 |
|
|
|
13,633,622 |
|
Operating loss |
|
|
(14,031,505 |
) |
|
|
(7,189,198 |
) |
|
|
(28,939,456 |
) |
|
|
(12,725,881 |
) |
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income, net |
|
|
52,599 |
|
|
|
48,549 |
|
|
|
155,978 |
|
|
|
53,687 |
|
Change in fair value of convertible promissory notes |
|
|
- |
|
|
|
(13,423,204 |
) |
|
|
- |
|
|
|
(14,571,109 |
) |
Change in fair value of earn-out liabilities |
|
|
220,000 |
|
|
|
- |
|
|
|
340,000 |
|
|
|
- |
|
Change in fair value of warrant liabilities |
|
|
3,091,000 |
|
|
|
- |
|
|
|
5,322,500 |
|
|
|
- |
|
Interest expense, net |
|
|
(553,303 |
) |
|
|
(155,854 |
) |
|
|
(677,481 |
) |
|
|
(163,855 |
) |
Loss before income taxes |
|
|
(11,221,209 |
) |
|
|
(20,719,707 |
) |
|
|
(23,798,459 |
) |
|
|
(27,407,158 |
) |
Income tax expense |
|
|
(14,037 |
) |
|
|
(1,600 |
) |
|
|
(13,618 |
) |
|
|
(1,789 |
) |
Net loss |
|
$ |
(11,235,246 |
) |
|
$ |
(20,721,307 |
) |
|
$ |
(23,812,077 |
) |
|
$ |
(27,408,947 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share, basic and diluted |
|
$ |
(0.36 |
) |
|
$ |
(1.18 |
) |
|
$ |
(0.80 |
) |
|
$ |
(1.62 |
) |
Weighted average shares outstanding, basic and diluted |
|
|
31,391,595 |
|
|
|
17,538,437 |
|
|
|
29,901,952 |
|
|
|
16,934,803 |
|
PSQ HOLDINGS, INC. (dba PublicSquare) Condensed Consolidated Statements of Cash Flows (Unaudited) |
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For the six months ended
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|
2024 |
|
|
2023 |
|
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Cash Flows from Operating Activities |
|
|
|
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|
Net loss |
|
$ |
(23,812,077 |
) |
|
$ |
(27,408,947 |
) |
Adjustment to reconcile net loss to cash used in operating activities: |
|
|
|
|
|
|
|
|
Change in fair value of convertible promissory notes |
|
|
- |
|
|
|
14,571,109 |
|
Change in fair value of warrant liabilities |
|
|
(5,322,500 |
) |
|
|
- |
|
Change in fair value of earn-out liabilities |
|
|
(340,000 |
) |
|
|
- |
|
Share-based compensation |
|
|
11,058,185 |
|
|
|
- |
|
Amortization of step-up in loans held for investment |
|
|
269,829 |
|
|
|
- |
|
Provision for credit losses on loans held for investment |
|
|
154,202 |
|
|
|
- |
|
Origination of loans and leases for resale |
|
|
(10,124,894 |
) |
|
|
- |
|
Proceeds from sale of loans and leases for resale |
|
|
11,247,135 |
|
|
|
- |
|
Gain on sale of loans and leases |
|
|
(1,122,241 |
) |
|
|
- |
|
Depreciation and amortization |
|
|
1,227,471 |
|
|
|
1,244,574 |
|
Non-cash operating lease expense |
|
|
208,564 |
|
|
|
82,673 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(493,985 |
) |
|
|
- |
|
Prepaid expenses and other current assets |
|
|
1,571,121 |
|
|
|
(745,075 |
) |
Inventory |
|
|
161,473 |
|
|
|
- |
|
Deposits |
|
|
13,929 |
|
|
|
(30,202 |
) |
Accounts payable |
|
|
(1,335,335 |
) |
|
|
149,173 |
|
Accrued expenses |
|
|
(110,806 |
) |
|
|
2,135,248 |
|
Deferred revenue |
|
|
16,636 |
|
|
|
63,867 |
|
Operating lease payments |
|
|
(206,258 |
) |
|
|
(80,071 |
) |
Net cash used in operating activities |
|
|
(16,939,551 |
) |
|
|
(10,017,651 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from Investing Activities |
|
|
|
|
|
|
|
|
Software development costs |
|
|
(1,777,479 |
) |
|
|
(992,467 |
) |
Principal paydowns on loans held for investment |
|
|
5,265,396 |
|
|
|
- |
|
Disbursements for loans held for investment |
|
|
(3,576,860 |
) |
|
|
- |
|
Acquisition of businesses, net of cash acquired |
|
|
141,215 |
|
|
|
- |
|
Purchase of short-term investments |
|
|
- |
|
|
|
(10,049,870 |
) |
Purchase of intangible assets and trademarks |
|
|
- |
|
|
|
(86,601 |
) |
Purchases of property and equipment |
|
|
- |
|
|
|
(113,064 |
) |
Net cash provided by (used in) investing activities |
|
|
52,272 |
|
|
|
(11,242,002 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from Financing Activities |
|
|
|
|
|
|
|
|
Proceeds from convertible note payable, related party (Note 12) |
|
|
10,000,000 |
|
|
|
- |
|
Proceeds from convertible note payable |
|
|
- |
|
|
|
22,500,000 |
|
Proceeds from the issuance of common stock |
|
|
- |
|
|
|
2,600,125 |
|
Repayments on revolving line of credit |
|
|
(1,808,833 |
) |
|
|
- |
|
Repayment of subscription payable |
|
|
- |
|
|
|
(400 |
) |
Net cash provided by financing activities |
|
|
8,191,167 |
|
|
|
25,099,725 |
|
Net (decrease) increase in cash and cash equivalents |
|
|
(8,696,112 |
) |
|
|
3,840,072 |
|
Cash, cash equivalents and restricted cash beginning of period |
|
|
16,446,030 |
|
|
|
2,330,405 |
|
Cash, cash equivalents and restricted cash end of the period |
|
$ |
7,749,918 |
|
|
$ |
6,170,477 |
|
Cash and cash equivalents |
|
$ |
7,613,430 |
|
|
$ |
6,170,477 |
|
Restricted cash |
|
|
136,488 |
|
|
|
- |
|
Total cash, cash equivalents and restricted cash, end of the period |
|
$ |
7,749,918 |
|
|
$ |
6,170,477 |
|
|
|
|
|
|
|
|
|
|
Supplemental Non-Cash Investing and Financing Activity |
|
|
|
|
|
|
|
|
Accrued variable compensation settled with RSU grants |
|
$ |
411,880 |
|
|
$ |
- |
|
Shares issued in connection with Credova Merger |
|
$ |
14,137,606 |
|
|
$ |
- |
|
Note Exchange in connection with Credova Merger |
|
$ |
8,449,500 |
|
|
$ |
- |
|
Brand intangible purchase for stock |
|
$ |
- |
|
|
$ |
1,334,850 |
|
Adjusted EBITDA
Adjusted EBITDA, a non-GAAP financial measure, as net earnings (loss) before interest and other expenses, net, income tax expense, depreciation and amortization, as adjusted to exclude change in fair value of our financial instruments, other income (expense), net, transaction expenses and share-based compensation expense. We utilize adjusted EBITDA as an internal performance measure in the management of our operations because we believe the exclusion of these non-cash and non-recurring charges allow for a more relevant comparison of our results of operations to other companies in our industry. Adjusted EBITDA should not be viewed as a substitute for net loss calculated in accordance with GAAP, and other companies may define adjusted EBITDA differently.
The following table provides a reconciliation of net loss to adjusted EBITDA to net loss for the periods presented:
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For the three months ended |
|
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For the six months ended |
|
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|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Net loss |
|
$ |
(11,235,246 |
) |
|
$ |
(20,721,307 |
) |
|
$ |
(23,812,077 |
) |
|
$ |
(27,408,947 |
) |
Excluding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net |
|
|
553,303 |
|
|
|
155,854 |
|
|
|
677,481 |
|
|
|
163,855 |
|
Income tax expense |
|
|
14,037 |
|
|
|
1,600 |
|
|
|
13,618 |
|
|
|
1,789 |
|
Change in fair value of convertible notes |
|
|
- |
|
|
|
13,423,204 |
|
|
|
- |
|
|
|
14,571,109 |
|
Change in fair value of earnout liabilities |
|
|
(220,000 |
) |
|
|
- |
|
|
|
(340,000 |
) |
|
|
- |
|
Change in fair value of warrant liabilities |
|
|
(3,091,000 |
) |
|
|
- |
|
|
|
(5,322,500 |
) |
|
|
- |
|
Other income, net |
|
|
(52,599 |
) |
|
|
(48,549 |
) |
|
|
(155,978 |
) |
|
|
(53,687 |
) |
Depreciation and amortization |
|
|
930,874 |
|
|
|
699,237 |
|
|
|
1,227,471 |
|
|
|
1,244,574 |
|
Share-based compensation (exclusive of what is shown above in transaction costs) |
|
|
5,171,760 |
|
|
|
- |
|
|
|
10,170,774 |
|
|
|
- |
|
Transaction costs incurred in connection with acquisitions |
|
|
1,908 |
|
|
|
- |
|
|
|
2,295,502 |
|
|
|
- |
|
Adjusted EBITDA |
|
$ |
(7,926,963 |
) |
|
$ |
(6,489,961 |
) |
|
$ |
(15,245,709 |
) |
|
$ |
(11,481,307 |
) |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240814298550/en/
Investors Contact:
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