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Business Highlights
Management Commentary
Scott Wallace, CEO & Founder, commented on the year's results, "2023 was a key period in ECD's history with the Company beginning trading on the Nasdaq exchange in December. Over the course of our Company's history, we have built over 500 custom cars and generated over $84 million in lifetime revenues. Our 100,000 square foot manufacturing facility currently has 2 production lines running and we are working to finalize our third production line to focus on classic Ford Mustangs following our recent acquisition of assets from Brand New Muscle Car. We can scale our existing footprint to maximize the business model while also looking at growth opportunities in the larger classic car ecosystem. We have continuously operated the Company to produce positive cash flow and will continue a disciplined approach to capital allocation whether those growth opportunities are organic or inorganic.
"ECD has three powerful paths toward profitable growth: maximizing production efficiency, consolidating the luxury classic car market, and building an umbrella luxury auto brand. We estimate this larger ecosystem represents an addressable market of $15 billion covering manufacturing, storage, brokerage and financial services. We believe that by filling the factory, building out our product base, and leveraging our respected brand, ECD will be able to build on our current leadership in the resto-mod industry to become the trusted luxury auto partner for discerning customers."
Financial Results
During the year ended December 31, 2023, overall revenue totaled $15.1 million, or an increase of 22.5%, compared to $12.3 million in the previous year. The increase was primarily due to an increase in average selling price per vehicle by $25,075 and increased production due to efficiency improvements.
Gross profit increase to $4.3 million or 28% of revenue compared to $1.7 million, or 14% or revenue in 2022.
Operating expenses increased to $5.8 million in 2023 compared to $3.6 million in 2022. The increase in operating expenses was primarily due to the increase in general and administrative expenses related to the Company's growth and expansion of operations as well as costs related to being a public company.
Operating income improved to $(1.6) million in 2023 from $(1.9) million in 2022. The increase was primarily due to improved gross margins due to a decrease in per truck material costs, and efficiencies in the build process.
Net loss for 2023 was ($1.6) million compared to a net loss of ($1.4) million in 2022. Earnings per diluted share were $(0.09) in 2023 compared to $(0,06) in 2022. The change in net income was primarily the result of interest expense affiliated with a letter of credit and convertible note.
Adjusted EBITDA, shown in tables below, increased to $1.1 million in 2023 from a loss of $(1.3) million in 2022.
Cash and equivalents on December 31, 2023 were $8.1 million, compared to $3.5 million on December 31, 2022. Additionally, the company had $10.7 million convertible notes in long-term liabilities at year end.
Posted In: ECDA
