Cannabis-Focused Software Co. Springbig Sees Slight Q1 Revenue Decline But Improves Net Loss, Keeps Full Year Financial Guidance

Author: Rolando García | May 16, 2024 08:36am

Florida-based software and cannabis marketing company Springbig Holdings, Inc. (OTCQX:SBIG) released its first quarter 2024 financial figures and announced the appointment to the board of Mark Silver, president of Optus Capital Corporation and a key player in the company’s January debt refinancing.

Paul Sykes, CFO, remarked on achieving a positive adjusted EBITDA for the first time at $150,000, compared to a loss of $1.3 million in the prior year, and debt financing:

"After completing our $8 million debt financing in January, we have a much stronger and cleaner balance sheet,” Sykes said. “We continue to manage the optimization of our operating expenses, which have reduced by 34% year-on-year, and expect a continuing positive trend in our Adjusted EBITDA margins as the year progresses."

Key Financial Figures

Revenue: Q1 2024 revenue of $6.5 million decreased from $7.2 million the previous year.
Gross Profits and Margin: Gross profits are $4.7 million, with a gross margin of 72%, down 19% compared to $5.8 million in Q1 2023.
Net income: $417,000 compared to a net loss of $2.3 million in the prior year.
Basic and diluted net income per share was $0.01, versus a loss per share of $0.08 in the same period of 2023.

Debt Financing And Reduced Operating Expenses

Informed net income includes a gain of $1.6 million on the repurchase of convertible debt, done in January 2024.

The improved financial figures related to an operating expenses reduction of 34% year-on-year and debt-restructuring of $6.4 million by 8% convertible notes due 2026 and a $1.6 million 12% in a term loan due 2026.

The company remarked newer initiatives “subscriptions by Springbig" and "gift cards by Springbig" as sources of diversification “into regulated markets beyond cannabis”.

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Financial Outlook

For the second quarter of 2024, Springbig currently expects revenue in the range of $6.5 – $7.0 million and Adjusted EBITDA positive in the range of $300.000 to $600.000. For the year ending December 31, 2024, expects revenue in the range of $29 – $32 million and adjusted EBITDA gain in the range of $3.5 – $5.0 million.