Sacks Parente Golf, Inc. Announces Year End 2023 Financial Results and Provides Corporate Update
*Camarillo, Calif., March 18, 2024 (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 putters, golf shafts, golf grips, and other golf-related accessories, reports its financial results for the year ended December 31, 2023 and provides a business update.*FY 2023 Highlights*
· Raised $11.6 million in net proceeds from completed IPO in August 2023
· Recognized sequentially higher revenue over last three quarters of 2023
· Made significant investment in equipment and facility improvements for manufacturing and distribution facility in St. Joseph, Mo.
· Launched Newton Motion product line of ready-to-play replacement driver shafts in November 2023, which is expected to generate in excess of 60% of Company revenue in 2024
· Invested in sales and marketing to grow brand awareness of Sacks Parente premium putter family and newly launched Newton Motion product line
· Hired Scott White, former CEO of Ben Hogan Golf Equipment Company, as Chief Operating Officer
*Recent Corporate Highlights*
· Anticipating continued sequentially higher revenue throughout 2024 with improved gross margins. The Company is benefitting from accelerating Newton Motion shaft shipments, including to multiple international customers, efficient marketing ad spend on shafts, and the start of the seasonally strong period of the year with warmer months ahead
· Announced that the Company’s premium putters and Newton Motion driver shafts were available in all 126 Club Champion retail stores nationwide. The Company expects to see accelerated quarterly revenue from this relationship begining in 2Q24
· Entered into player agreements for Newton Motion shaft sponsorships with Ken Duke (PGA Tour Champions), and Fernandra Lira (LET/LPGA/Epson Tours)
· Appointed golf-industry veteran Jane Casanta to the Board of Directors
“We built a strong foundation in 2023 and are positioned well to execute our strategic plan and grow our revenue in 2024 and beyond,” commented Greg Campbell, Executive Chairman. “Our IPO in August provided us the capital to bring on additional talent to our team and complete the buildout of our Missouri manufacturing facility, including recently transferring production of our premium putter line from California to our Missouri facility to improve efficiencies. In addition, we have increased our marketing budget to help promote awareness of primarily our Newton product line. We have been pleased with the initial reception and order patterns, including from some international customers, for our Newtwon shafts and see this momentum continuing, especially as we begin the seasonally stronger spring months for the golf industry. We anticipate sequentially record revenue throughout 2024 and see the expected success from the Newton product line as a key component of that growth. Given our direct to consumer strategy, we are encouraged by our current strong return on ad spending with Newton and look for that trend to continue, especially given our team’s proven marketing experience in the golf industry.
“The Sacks Parente foundation is in place, we have the resources to execute, and we look forward to sharing our milestones and successes as they unfold,” concluded Campbell.
*About Sacks Parente Golf*
Sacks Parente Golf, Inc. serves as the parent entity of technology-forward golf companies that help golfers elevate their game. With a growing portfolio of golf products, including putters, golf shafts, golf grips, and other golf-related accessories, 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, and pioneering ultra-light carbon fiber putter shafts.
In consideration of its growth opportunities in golf shaft technologies, the Company expanded its manufacturing business in April of 2022 to develop the advanced Newton brand of 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, while also expanding 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, Club Champion retail stores, and distributors in the United States, Japan, and South Korea. For more information, please visit the Company’s website at https://sacksparente.com/. @sacksparentegolf @newtonshafts
*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
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*SACKS PARENTE GOLF, INC.*
*BALANCE SHEETS*
*(Amounts rounded to nearest thousands, except share amounts)*
*December 31, 2023* *December 31, 2022*
*ASSETS*
Current Assets:
Cash and cash equivalents $ 5,338,000 $ 147,000
Restricted cash - 24,000
Accounts receivable 53,000 2,000
Inventory, net of reserve for obsolescence of $98,000 and $73,000, respectively 248,000 142,000
Prepaid expenses and other current assets 196,000 16,000
Total Current Assets 5,835,000 331,000
Property and equipment, net 379,000 122,000
Right-of-use asset, net 65,000 22,000
Deferred software licensing agreement 110,000 -
Deferred offering costs - 230,000
Deposits 5,000 5,000
*Total Assets* $ 6,394,000 $ 710,000
*LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIENCY)*
Current Liabilities:
Accounts payable and accrued expenses $ 401,000 $ 97,000
Accrued payroll to executives - 1,095,000
Lease liability, current 31,000 17,000
Deferred software licensing obligation 41,000 -
Equipment purchase obligation - 15,000
Loans payable – related parties - 537,000
Notes payable - 384,000
Customer deposits 2,000 21,000
Total Current Liabilities 475,000 2,166,000
Software licensing fee obligation, net of current 95,000 -
Lease liability, net of current 34,000 6,000
*Total Liabilities* 604,000 2,172,000
Common stock subject to possible redemption (561,375 shares at redemption price of $1.07) at December 31, 2022 - 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 15,961,000 3,702,000
Accumulated deficit (10,317,000 ) (5,692,000 )
*Total Stockholders’ Equity (Deficiency)* 5,790,000 (1,882,000 )
*Total Liabilities and Stockholders’ Equity (Deficiency)* $ 6,394,000 $ 710,000 *SACKS PARENTE GOLF, INC.*
*STATEMENTS OF OPERATIONS*
*For the Years Ended December 31, 2023 and 2022*
*(Amounts rounded to nearest thousands, except share and per share amounts)*
*Years Ended December 31,* *2023* *2022*
*Net Sales* $ 349,000 $ 190,000
Cost of goods sold 227,000 110,000
*Gross profit* 122,000 80,000
*Operating expenses:*
Selling, general and administrative expense 4,497,000 2,874,000
Research and development expense 258,000 73,000
*Total operating expenses* 4,755,000 2,947,000
*Loss from operations* (4,633,000 ) (2,867,000 )
Loss on extinguishment of debt - (574,000 )
Interest income (expense), net 8,000 (64,000 )
*Net Loss* $ (4,625,000 ) $ (3,505,000 )
*Loss per share – basic and diluted* $ (0.38 ) $ (0.34 )
*Weighted average number of shares outstanding – basic and diluted* 12,237,395 10,433,820
*
SACKS PARENTE GOLF, INC.*
*STATEMENTS OF CASH FLOWS*
*For the Years Ended December 31, 2023 and 2022*
*(Amounts rounded to nearest thousands)*
*Years Ended December 31,* *2023* *2022*
Cash Flows from Operating Activities
*Net Loss* $ (4,625,000 ) $ (3,505,000 )
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation 32,000 11,000
Amortization 26,000 -
Change in reserve for inventory obsolescence 25,000 (36,000 )
Vesting of options 443,000 1,383,000
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 30,000 12,000
Accrued interest - 63,000
Changes in operating assets and liabilities
Accounts receivable (51,000 ) 9,000
Inventory (131,000 ) (62,000 )
Prepaids and other current assets (180,000 ) 4,000
Deposits - (1,000 )
Accounts payable and accrued expenses 304,000 88,000
Accrued payroll to officers (1,095,000 ) 615,000
Lease liability (31,000 ) (11,000 )
Customer deposits (19,000 ) 18,000
*Net cash used in operating activities* (5,047,000 ) (785,000 )
Cash Flows from Investing Activities
Purchase of property and equipment (289,000 ) (75,000 )
*Net cash used in investing activities* (289,000 ) (75,000 )
Cash Flows from Financing Activities
Payment of equipment purchase obligation (15,000 ) (43,000 )
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 61,000 350,000
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* 10,503,000 847,000
Net increase (decrease) in cash 5,167,000 (13,000 )
Cash and cash equivalents and restricted cash beginning of period 171,000 184,000
Cash and cash equivalents and restricted cash end of period $ 5,338,000 $ 171,000
*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 $ - $ 1,624,000
New right of use asset and lease liability $ 73,000 $ 34,000
Recording of deferred software licensing agreement $ 136,000 $ -
Property and equipment purchased with debt $ - $ 58,000
Reclass of common stock subject to redemption to equity $ 420,000 $ -