Camarillo, CA., Nov. 09, 2023 (GLOBE NEWSWIRE) -- Sacks Parente Golf, Inc. (NASDAQ:SPGC), (the “Company” or “Sacks Parente”), a technology-forward golf company with a growing portfolio of golf products, including putting instruments, golf shafts, golf grips, and other golf-related accessories, reports financial results for its fiscal third quarter ended September 30, 2023 and provides a business update.
Recent Corporate Highlights
- Completed Initial Public Offering (IPO) transaction in mid-August 2023 that raised $11.6 million in proceeds, net of underwriting fees
- Third quarter revenue growth increased 98% year-over-year
- Appointed golf industry veteran Scott White as Chief Operating Officer
Timothy Triplett, Sacks Parente Golf’s Chief Executive Officer, commented, “With the proceeds from our recent IPO, we have continued to build out our Missouri manufacturing facility in preparation for increased production of both our Sacks Parente putters and our soon-to-be-launched new line of Newton carbon fiber shafts. Just as our line of putters have been shown in independent testing to lead to more made putts, early test data on our Newton shafts confirm our expectations that golfers will enjoy more accurate control from their drives. From the first tee shot to the final putt, we are convinced golfers of all ages and skill levels should be able to benefit from our advanced product lines.
“Revenue in the third quarter increased 98% year-over-year and was positively impacted by increased shipments of our Sacks Parente line of putters to our distributor in Korea. Korea is the world’s third largest golf market, and also the fastest growing golf market, and a key strategic goal of the Company over the next few years is growing international sales to meaningful levels,” concluded Mr. Triplett.
About Sacks Parente Golf
Sacks Parente Golf, Inc. is a technology-forward golf company, with a growing portfolio of golf products, including putting instruments, golf shafts, golf grips, and other golf-related products. The Company’s innovative accomplishments include: the First Vernier Acuity putter, patented Ultra-Low Balance Point (ULBP) putter technology, weight-forward Center-of-Gravity (CG) design while pioneering ultra-light carbon fiber putter shafts. In consideration of its growth opportunities in shaft technologies, in April of 2022 the Company expanded its manufacturing business to include advanced premium golf shafts by opening a new shaft manufacturing facility in St. Joseph, MO. It is the Company’s intent to manufacture and assemble substantially all products in the United States. The Company anticipates expansion into golf apparel and other golf-related product lines to enhance its growth. The Company’s future expansions may include broadening its offerings through mergers, acquisitions or internal developments of product lines that are complementary to its premium brand. The Company currently sells its products through resellers, the Company’s websites, and distributors in the United States, Japan, and South Korea.
Forward Looking Statements
This press release contains statements that constitute “forward-looking statements,” including with respect to the proposed initial public offering and the anticipated use of the net proceeds. No assurance can be given that the offering discussed above will be completed on the terms described, or at all, or that the net proceeds of the offering will be used as indicated. Forward-looking statements are subject to numerous conditions, many of which are beyond the control of the Company, including those set forth in the Risk Factors section of the Company’s registration statement and preliminary prospectus for the Company’s offering filed with the SEC. Copies of these documents are available on the SEC’s website, www.sec.gov. The Company undertakes no obligation to update these statements for revisions or changes after the date of this release, except as required by law.
Contacts:
Company:
Steve Handy, CFO
Sacks Parente Golf, Inc.
Email: investors@sacksparente.com
www.sacksparente.com
Investor Relations:
CORE IR
Email: investors@sacksparente.com
Phone: (516)222-2560
SACKS PARENTE GOLF, INC.
CONDENSED BALANCE SHEETS
(Amounts rounded to nearest thousands, except share amounts)
| September 30, 2023 | December 31, 2022 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | $ | 6,768,000 | $ | 147,000 | ||||
| Restricted cash | - | 24,000 | ||||||
| Accounts receivable | 18,000 | 2,000 | ||||||
| Inventory, net of reserve for obsolescence of $119,000 and $73,000, respectively | 165,000 | 142,000 | ||||||
| Prepaid expenses and other current assets | 766,000 | 16,000 | ||||||
| Total Current Assets | 7,717,000 | 331,000 | ||||||
| Property and equipment, net | 208,000 | 122,000 | ||||||
| Right-of-use asset, net | 42,000 | 22,000 | ||||||
| Deferred offering costs | - | 230,000 | ||||||
| Deposits | 5,000 | 5,000 | ||||||
| Total Assets | $ | 7,972,000 | $ | 710,000 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIENCY) | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable and accrued expenses | $ | 375,000 | $ | 97,000 | ||||
| Accrued payroll to executives | - | 1,095,000 | ||||||
| Lease liability, current | 33,000 | 17,000 | ||||||
| Equipment purchase obligation | - | 15,000 | ||||||
| Loans payable – related parties | - | 537,000 | ||||||
| Notes payable (past due) | - | 384,000 | ||||||
| Customer deposits | 2,000 | 21,000 | ||||||
| Total Current Liabilities | 410,000 | 2,166,000 | ||||||
| Lease liability, net of current | 9,000 | 6,000 | ||||||
| Total Liabilities | 419,000 | 2,172,000 | ||||||
| Common stock subject to possible redemption (561,375 shares at redemption price of $1.07) | - | 420,000 | ||||||
| Commitments and Contingencies | ||||||||
| Stockholders’ Equity (Deficiency): | ||||||||
| Preferred stock $.01 par value, 5,000,000 shares authorized, no shares issued and outstanding | - | - | ||||||
| Common stock, $.01 par value, 45,000,000 shares authorized, 14,595,870 and 10,784,495, shares issued and outstanding, respectively, excluding 561,375 shares subject to possible redemption at December 31, 2022 | 146,000 | 108,000 | ||||||
| Additional paid-in-capital | 15,885,000 | 3,702,000 | ||||||
| Accumulated deficit | (8,478,000 | ) | (5,692,000 | ) | ||||
| Total Stockholders’ Equity (Deficiency) | 7,553,000 | (1,882,000 | ) | |||||
| Total Liabilities and Stockholders’ Equity (Deficiency) | $ | 7,972,000 | $ | 710,000 | ||||
SACKS PARENTE GOLF, INC.
CONDENSED STATEMENTS OF OPERATIONS
For the Three and Nine Months Ended September 30, 2023 and 2022
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||
| Net Sales | $ | 95,000 | $ | 48,000 | $ | 232,000 | $ | 157,000 | ||||||||
| Cost of goods sold | 56,000 | 27,000 | 134,000 | 70,000 | ||||||||||||
| Gross profit | 39,000 | 21,000 | 98,000 | 87,000 | ||||||||||||
| Operating expenses | ||||||||||||||||
| Selling, general and administrative expenses | (a) | 1,195,000 | 520,000 | 2,758,000 | 2,429,000 | |||||||||||
| Research and development | 15,000 | 33,000 | 58,000 | 43,000 | ||||||||||||
| Total operating expenses | 1,210,000 | 553,000 | 2,816,000 | 2,472,000 | ||||||||||||
| Loss from operations | (1,171,000 | ) | (532,000 | ) | (2,718,000 | ) | (2,385,000 | ) | ||||||||
| Other expenses | ||||||||||||||||
| Interest, net | (26,000 | ) | (16,000 | ) | (68,000 | ) | (23,000 | ) | ||||||||
| Loss on extinguishment of debt | - | - | - | (574,000 | ) | |||||||||||
| Total other expenses | (26,000 | ) | (16,000 | ) | (68,000 | ) | (597,000 | ) | ||||||||
| Net loss | $ | (1,197,000 | ) | $ | (548,000 | ) | $ | (2,786,000 | ) | $ | (2,982,000 | ) | ||||
| Net loss per share – basic and diluted | $ | (0.09 | ) | $ | (0.05 | ) | $ | (0.24 | ) | $ | (0.29 | ) | ||||
| Weighted average common shares outstanding – basic and diluted | 12,674,298 | 10,784,495 | 11,442,597 | 10,311,465 | ||||||||||||
(a) The increase in selling, general and administrative expenses for the three months ended September 30, 2023, was from increased legal and professional fees of $224,000, increased public company related costs of $135,000, increased employee related expenses of $121,000, increased stock based compensation costs of $95,000, increased sales and marketing related expense of $55,000, and increased other general operating expenses of $45,000 over the prior year period.
SACKS PARENTE GOLF, INC.
CONDENSED STATEMENTS OF CASH FLOWS
For the Nine Months Ended September 30, 2023 and 2022
(Unaudited)
(Amounts rounded to nearest thousands)
| Nine Months Ended September 30, | ||||||||
| 2023 | 2022 | |||||||
| Cash Flows from Operating Activities | ||||||||
| Net Loss | $ | (2,786,000 | ) | $ | (2,982,000 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation | 15,000 | 6,000 | ||||||
| Change in reserve for inventory obsolescence | 46,000 | (25,000 | ) | |||||
| Vesting of options | 367,000 | 1,344,000 | ||||||
| Vesting of restricted stock | - | 25,000 | ||||||
| Modification of equity awards | - | 28,000 | ||||||
| Loss on extinguishment of debt | - | 574,000 | ||||||
| Shares issued for services | 225,000 | - | ||||||
| Changes in ROU asset | 23,000 | 8,000 | ||||||
| Accrued interest | - | 21,000 | ||||||
| Changes in operating assets and liabilities | ||||||||
| Accounts receivable | (16,000 | ) | 3,000 | |||||
| Inventory | (69,000 | ) | (11,000 | ) | ||||
| Prepaids and other current assets | (750,000 | ) | (25,000 | ) | ||||
| Deposits | - | (1,000 | ) | |||||
| Accounts payable and accrued expenses | 278,000 | 64,000 | ||||||
| Accrued payroll to officers | (1,095,000 | ) | 408,000 | |||||
| Lease liability | (24,000 | ) | (8,000 | ) | ||||
| Deferred revenue | (19,000 | ) | (3,000 | ) | ||||
| License obligation | - | (1,000 | ) | |||||
| Net cash used in operating activities | (3,805,000 | ) | (575,000 | ) | ||||
| Cash Flows from Investing Activities | ||||||||
| Purchase of property and equipment | (101,000 | ) | (75,000 | ) | ||||
| Net cash used in investing activities | (101,000 | ) | (75,000 | ) | ||||
| Cash Flows from Financing Activities | ||||||||
| Payment of equipment purchase obligation | (15,000 | ) | (29,000 | ) | ||||
| Deferred offering costs | 230,000 | (230,000 | ) | |||||
| Proceeds from private sale of common stock subject to possible redemption | 180,000 | 420,000 | ||||||
| Proceeds from public sale of common stock, net | 11,029,000 | - | ||||||
| Proceeds from notes payable | 61,000 | 100,000 | ||||||
| Repayment of notes payable | (445,000 | ) | - | |||||
| Proceeds from loans payable – related party | 20,000 | 200,000 | ||||||
| Repayment of loans payable – related party | (557,000 | ) | - | |||||
| Proceeds from convertible debt obligations | - | 150,000 | ||||||
| Net cash provided by financing activities | 10,503,000 | 611,000 | ||||||
| Net increase (decrease) in cash | 6,597,000 | (39,000 | ) | |||||
| Cash and cash equivalents and restricted cash beginning of period | 171,000 | 184,000 | ||||||
| Cash and cash equivalents and restricted cash end of period | $ | 6,768,000 | $ | 145,000 | ||||
| Supplemental disclosures of cash flow information: | ||||||||
| Cash paid for interest | $ | - | $ | - | ||||
| Cash paid for income taxes | $ | - | $ | - | ||||
| SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||||||||
| Common shares issued on conversion of convertible debt obligations | $ | - | $ | 1,050,000 | ||||
| New right of use asset and lease liability | $ | 43,000 | $ | 34,000 | ||||
| Property and equipment purchased with debt | $ | - | $ | 58,000 | ||||
| Reclass of common stock subject to redemption to equity | $ | 420,000 | $ | - | ||||
