Connexa Reports Results of Quarterly Filing and Business Update
2023-10-19 06:00 ET - News Release
Connexa Reports Almost 40 Percent Drop in Operating Loss for Quarter Ended July 2023. - Revenue on Track for Estimated 10 Percent Growth in FY24
- Operational Profitability Expected by 4Q24
- Two New Product Launches Planned
- Company Meets Compliance with Four Nasdaq Listing Requirements
Windsor Mills, MD, Oct. 19, 2023 (GLOBE NEWSWIRE) -- Connexa Sports Technologies Inc. (Nasdaq:CNXA) reported operating results for the quarter ended July 31, 2023 and provided an update and review of operations, including compliance with four out of five Nasdaq listing requirements and advised it expects to achieve compliance with the one remaining deficiency by the current Nasdaq required date of January 22, 2024.
The four continuing listing compliance requirements recently met include:
- Filing of Form-10Q for 1Q FY24 (10/9/23)
- Filing of Form-10K for the FY 2023 (9/14/23)
- Minimum bid price, achieved by a 1:40 reverse stock split effective September 25, 2023.
- Appointment of two independent directors, bringing the total number of directors to five. The new directors are Rodney Rapson, CEO of an innovative wellness management system for young athletes, and Steve Crummey, a seasoned senior executive with management and board position experience in several industries.
The one remaining listing compliance issue outstanding, relates to the minimum capital requirement for a Company to maintain a Nasdaq listing. The Company is in discussion with several potential investors and currently expects to achieve compliance before the current deadline of January 22, 2024.
For the first fiscal quarter, ended July 31, 2023, the Company reported revenue of $3.1 million compared to $3.6 million reported for the same period to July 31, 2022 and an operating loss of $1.9 million, down approximately 40 percent from the corresponding operating loss of $3.1 million reported in the period last year.
“Our core business continues to be strong and now, having divested several untimely and costly acquisitions, we are preparing for a period of accelerated growth with new products in sports markets in which we enjoy high brand recognition and a growing base of loyal customers. Our expectation is to now be in a position to drive an estimated 10% revenue growth for fiscal 2024 and to deliver operating profitability within the fourth quarter,” said Mike Ballardie, CEO.
“We have a preeminent position in the racquet sports market with over 70,000 of our Slinger Bag tennis ball launchers sold worldwide over the past 36 months and with approximately 45,000 of those being sold in the US alone,” he continued. “Our shipping run-rate for Slinger Bag is currently about 1,200 per month and as Tennis continues to grow in participants – there are 87 million tennis players globally today with the ITF leadership expecting to meet its objective of 120 million players1 by 2030 – Slinger Bag Tennis continues to have significant opportunities for growth,” continued Ballardie.
The Company recently introduced its Slinger Bag Pickleball Launcher to serve one of the fastest growing racquetsports markets in the US, a market which currently boasts more than five million regular players. The Company has also introduced its Padel Tennis Launcher with the sport of Padel Tennis enjoying similar levels of growing participant numbers across Europe and South America.
In November, the Company expects to initiate beta testing of its new GameFace AI product for tennis - an IOS and Android downloadable app that records a practice session or matchplay video, analyzes their play and provides specific actionable feedback on how to improve.
Connexa’s team of AI engineers is also working to replicate this for Pickleball and Padel Tennis for late Spring 2024 after which it will focus on development of a baseball version to tie into the launch of Slinger Bag's innovative new Baseball Launcher. Follow-on verticals are expected to include golf, soccer, cricket, basketball, lacrosse and volleyball.
Each of these markets provides an opportunity for continuing revenue growth based on monthly or yearly subscriptions in the range of $15 and $100, respectively.
CONNEXA SPORTS TECHNOLOGIES, INC
CONSOLIDATED STATEMENTS OF OPERATIONS (IN US$) (UNAUDITED)
THREE MONTHS ENDED JULY 31, 2023 AND 2022
| | | 2023 | | | 2022 | |
| | | | | | | |
| NET SALES | | $ | 3,120,231 | | | $ | 3,583,336 | |
| | | | | | | | | |
| COST OF SALES | | | 2,227,482 | | | | 2,562,044 | |
| | | | | | | | . | |
| GROSS PROFIT | | | 892,749 | | | | 1,021,292 | |
| | | | | | | | | |
| OPERATING EXPENSES | | | | | | | | |
| Selling and marketing expenses | | | 242,353 | | | | 756,823 | |
| General and administrative expenses | | | 2,505,060 | | | | 3,314,610 | |
| Research and development costs | | | - | | | | 19,425 | |
| | | | | | | | | |
| Total Operating Expenses | | | 2,747,413 | | | | 4,090,858 | |
| | | | | | | | | |
| OPERATING LOSS | | | (1,854,664 | ) | | | (3,069,566 | ) |
Further information for shareholders can be found in an open letter posted on our website at https://www.connexasports.com/investor-relations/.
About Connexa Sports Technologies:
Connexa Sports a leading connected sports company delivering products, technologies, and Sport-as-a-Service across a range of sport verticals. Connexa’s mission is to reinvent sports through technological innovation driven by an unwavering focus on today’s sports consumer.
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