Loading...
01/11 03:43
Loading...
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings report reflects financial challenges with a significant net loss and cash flow concerns. Despite revenue growth, gross profit fell sharply due to a write-down, and expenses rose significantly. The Q&A highlighted potential growth but lacked clarity on future strategies. No share repurchase program was announced, and the absence of a positive catalyst like a new partnership or optimistic guidance further supports a negative outlook. The company's operational struggles and liquidity issues are likely to lead to a negative stock price reaction in the near term.
Revenue Q4 2024 $5.3 million, up from $4.8 million in the prior year, representing a year-over-year increase of approximately 10%. The increase was driven by higher sales volume, average sales price due to increased customization, and more used vehicle sales.
Gross Profit Q4 2024 $300,000 compared to $1.2 million in the prior year, a decrease of approximately 75%. The reduction was primarily due to a noncash $1.1 million write-down of labor overhead allocation and raw materials charged to cost of goods sold.
Advertising and Marketing Expenses Q4 2024 $286,000 compared to $335,000 in the prior year, a decrease of approximately 15%. The change was primarily due to reduced in-person marketing activity as the company optimized its marketing spend.
General and Administrative Expenses Q4 2024 $2.4 million compared to $1.6 million in the prior year, an increase of approximately 50%. This increase was due to growth in operations, public company costs, and one-time costs of $200,000 associated with the restatement of prior financial statements.
Net Loss Q4 2024 $3.3 million or $0.11 per diluted share compared to a loss of $700,000 or $0.03 per diluted share in the prior year, representing a year-over-year increase in loss of approximately 371%.
Revenue Full Year 2024 $25.2 million compared to $19.5 million in 2023, representing an increase of 29%. The increase was primarily due to increased unit sales, a higher average selling price per vehicle by $25,000, and increased sales of used vehicles.
Gross Profit Full Year 2024 $5.9 million compared to $4.5 million in the prior year, an increase of approximately 31%. The gross profit margin for 2024 was 23.4%.
Advertising and Marketing Expenses Full Year 2024 $1.2 million compared to $640,000 in the prior year, an increase of approximately 88%. This increase was driven by higher advertising volume and increased costs of web advertising.
General and Administrative Expenses Full Year 2024 $9.1 million compared to $5.1 million in the prior year, an increase of approximately 78%. This increase was due to growth in operations, public company costs, and one-time costs of $700,000 associated with the restatement of prior financial statements.
Net Loss Full Year 2024 $10.8 million or $0.32 per diluted share compared to a loss of $1.2 million or $0.05 per diluted share in the prior year, representing an increase in loss of approximately 800%.
Cash Balance as of December 31, 2024 $1.5 million compared to $8.1 million as of December 31, 2023, a decrease of approximately 81%. This reflects the company's cash position as it focuses on turning inventory into cash.
New Product Launches: ECD has begun limited production of built-to-own vehicles, which feature luxurious details and are available for immediate purchase.
Market Expansion: ECD has launched a retail strategy, opening its first retail location in West Palm Beach, Florida, and a second in Nantucket, with plans for more locations in affluent areas.
Operational Efficiencies: Quality control has been moved within the production line to ensure better build quality and increase customer satisfaction.
Strategic Shifts: ECD is shifting from exclusive online sales to a physical retail presence, enhancing customer engagement and reducing marketing costs.
Tariffs Impact: Concerns regarding tariffs and their potential impact on manufacturing costs and margins. The company has developed an internal plan to mitigate these risks.
Regulatory Issues: Challenges faced due to the shutdown of the prior auditor, which necessitated a reaudit of financial statements for 2022, 2023, and the first half of 2024.
Supply Chain Challenges: Delays in vehicle title transfers impacted revenue recognition, with 12 vehicles completed but not transferred before year-end.
Economic Factors: Increased advertising and marketing expenses due to higher online traffic and web advertising costs, which may affect profitability.
Operational Losses: The company reported a net loss of $10.8 million for the year, indicating ongoing financial challenges.
Cash Flow Concerns: A significant decrease in cash balance from $8.1 million to $1.5 million, raising concerns about liquidity and operational sustainability.
Revenue Growth: ECD Automotive Design grew revenue by approximately 29% to $25.2 million in 2024, a record for the company.
Gross Profit Increase: Gross profit increased by 30% to $5.9 million in 2024.
Retail Strategy Launch: ECD announced the launch of its retail strategy, opening its first retail location in West Palm Beach, Florida, and a second in Nantucket, with plans for more locations.
Product Offering Expansion: The company added vehicle models including Classic Toyota FJs and Classic Ford Mustangs through licensing agreements.
Quality Control Improvement: Quality control processes were enhanced by moving the team within the production line to ensure better build quality.
Built-to-Own Vehicles: ECD began limited production of built-to-own vehicles to cater to customers who prefer immediate purchase options.
2025 Revenue Expectations: ECD expects to maintain production and sales at current cash levels while focusing on turning inventory into cash.
Gross Margin Outlook: Gross margins are expected to revert back to historical levels as the company moves into 2025.
Retail Sales Projections: The company aims to sell 96 vehicles annually through its retail locations, contributing to overall sales growth.
Capital Allocation Priorities: Capital allocation will focus on parts and mechanics, with occasional opportunistic capital-light acquisitions.
Share Repurchase Program: None
The earnings call reveals several concerning aspects: declining revenue and gross profit, elevated costs due to tariffs and shipping, and non-compliance with NASDAQ requirements. Despite some positive initiatives like cost-saving measures and expansion into new markets, these are overshadowed by financial losses, poor gross margins, and economic pressures. The lack of clarity in the Q&A section further dampens sentiment. Given these factors, a negative stock price movement is likely over the next two weeks.
Despite strategic initiatives like Mustang expansion and cost optimization, the company faces significant risks, including NASDAQ delisting, declining margins, increased losses, and heavy reliance on volatile Bitcoin strategy. Financial metrics show increased losses and reduced cash flow, outweighing any positive outlook from strategic plans, leading to a negative sentiment.
The earnings report reflects financial challenges with a significant net loss and cash flow concerns. Despite revenue growth, gross profit fell sharply due to a write-down, and expenses rose significantly. The Q&A highlighted potential growth but lacked clarity on future strategies. No share repurchase program was announced, and the absence of a positive catalyst like a new partnership or optimistic guidance further supports a negative outlook. The company's operational struggles and liquidity issues are likely to lead to a negative stock price reaction in the near term.
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
