Stran & Company, Inc. ("Stran" or the "Company")
(NASDAQ: STRN) (NASDAQ: STRNW), a leading outsourced
marketing solutions provider that leverages its promotional
products and loyalty incentive expertise, today provided a business
update and reported financial results for the three months ended
June 30, 2022.
Andy Shape, President and CEO of Stran,
commented, “We continued our growth trajectory during the second
quarter, illustrated by record revenue of $14.8 million, a 72.5%
increase compared to the same period last year. Importantly, on an
organic basis, our year-over-year revenue increased 49.4%,
reinforcing our traction in the market. We remain committed to our
business growth strategy involving expansion of our geographic
footprint, entering new verticals and opportunistic acquisitions
that complement our existing platform. Towards this end, I’m proud
to report that we have fully integrated G.A.P. Promotions into our
business operations, which we acquired in January 2022. More
recently, we entered into a definitive agreement to acquire Trend
Brand Solutions, a leading global brand solutions company,
strategically headquartered in Tomball, Texas. As we work toward
realizing our M&A goals, we expect to increase our customer
base, grow our capabilities within the beverage space, and expand
our geographic presence within the United States. Given the
fragmented nature of the industry, we believe that our strategy of
acquiring under-valued and accretive businesses will remain a key
aspect of our strategy, bringing together innovation,
relationships, and top-tier talent.”
Mr. Shape continued, “In order to further
accelerate growth and leverage our established infrastructure, we
recently expanded our sales and marketing initiatives by
establishing a dedicated lead generation team and increasing our
digital marketing spend. Although we are now carrying public
company expenses that we did not incur last year and added other
fixed expenses to support our planned growth, we expect to resume
and build upon our track record of profitability given our highly
scalable operations. Overall, we have maintained a solid balance
sheet with over $28 million of cash and cash equivalents as of June
30, 2022, which provides us significant resources to execute on our
business growth strategy and establish Stran as a preeminent force
in the promotional products industry.”
Financial Results
Revenue for the three months ended June 30, 2022
was $14.8 million compared to $8.6 million for the same period in
2021. The increase was primarily due to higher spending from
existing clients as well as business from new customers.
Additionally, the Company benefited from the acquisition of the
G.A.P. Promotions assets in January 2022.
Gross profit increased to $3.8 million, or 25.4%
of revenue, for the three months ended June 30, 2022, compared to
$2.1 million, or 25.0% of revenue, for the same period last year.
The increase in gross profit was due to increased sales, partially
offset by an increase in purchasing costs.
Net loss for the three months ended June 30,
2022 was approximately $0.4 million, compared to net loss of
approximately $0.2 million for the same period last year. This
increase was primarily due to integration expenses related to the
January 2022 acquisition of the G.A.P. Promotions assets, ongoing
expenses related to being a public company, and higher cost of
purchases. These factors were partially offset by the increase in
sales from the G.A.P. Promotions asset purchase and the increase
from recurring organic sales.
Conference Call
Stran will host a conference call today at 10:00
A.M. Eastern Time to discuss the Company’s financial results for
the second quarter ended June 30, 2022, as well as the Company’s
corporate progress and other developments.
The conference call will be available via
telephone by dialing toll free 888-506-0062 for U.S. callers or +1
973-528-0011 for international callers and using entry code:
371218. A webcast of the call may be accessed at
https://www.webcaster4.com/Webcast/Page/2855/46359 or on the
Investors section of the Company’s website at ir.stran.com.
A webcast replay will also be available on the
Company’s Investors section of the website (ir.stran.com) through
August 12, 2023. A telephone replay of the call will be available
approximately one hour following the call, through August 26, 2022,
and can be accessed by dialing 877-481-4010 for U.S. callers or +1
919-882-2331 for international callers and entering conference ID:
46359.
About Stran
Over the past 27 years, Stran has grown to
become a leader in the promotional products industry, specializing
in complex marketing programs to help recognize the value of
promotional products, branded merchandise and loyalty incentive
programs as a tool to drive awareness, build brands and impact
sales. Stran is the chosen partner of many Fortune 500 companies,
across a variety of industries, to execute their promotional
marketing, loyalty and incentive, sponsorship activation,
recruitment, retention, and wellness campaigns. Stran provides
world-class customer service and utilizes cutting-edge technology,
including efficient ordering and logistics technology to provide
order processing, warehousing and fulfillment functions. The
Company’s mission is to develop long-term relationships with its
clients, enabling them to connect with both their customers and
employees in order to build lasting brand loyalty. Additional
information about the Company is available at: www.stran.com.
Forward Looking Statements
This press release contains “forward-looking
statements” that are subject to substantial risks and
uncertainties. All statements, other than statements of historical
fact, contained in this press release are forward-looking
statements. Forward-looking statements contained in this press
release may be identified by the use of words such as “anticipate,”
“believe,” “contemplate,” “could,” “estimate,” “expect,” “intend,”
“seek,” “may,” “might,” “plan,” “potential,” “predict,” “project,”
“target,” “aim,” “should,” "will” “would,” or the negative of these
words or other similar expressions, although not all
forward-looking statements contain these words. Forward-looking
statements are based on the Company’s current expectations and are
subject to inherent uncertainties, risks and assumptions that are
difficult to predict. Further, certain forward-looking statements
are based on assumptions as to future events that may not prove to
be accurate. These and other risks and uncertainties are described
more fully in the section titled “Risk Factors” in the final
prospectus related to the public offering filed with the SEC and
other reports filed with the SEC thereafter. Forward-looking
statements contained in this announcement are made as of this date,
and the Company undertakes no duty to update such information
except as required under applicable law.
Contacts:
Investor Relations Contact:
Crescendo Communications, LLCTel: (212)
671-1021STRN@crescendo-ir.com
Press Contact:
Howie Turkenkopf press@stran.com
CONDENSED CONSOLIDATED BALANCE
SHEETS
|
|
June 30, |
|
|
December 31, |
|
|
|
2022 |
|
|
2021 |
|
|
|
(unaudited) |
|
|
|
|
ASSETS |
|
|
|
CURRENT ASSETS: |
|
|
|
|
|
|
Cash |
|
$ |
28,201,906 |
|
|
$ |
32,226,668 |
|
Accounts Receivable, Net |
|
|
11,337,433 |
|
|
|
8,982,768 |
|
Deferred Income Taxes |
|
|
386,700 |
|
|
|
113,000 |
|
Inventory |
|
|
5,958,141 |
|
|
|
5,230,792 |
|
Prepaid Corporate Taxes |
|
|
87,459 |
|
|
|
87,459 |
|
Deposits |
|
|
634,210 |
|
|
|
623,402 |
|
Prepaid Expenses |
|
|
303,508 |
|
|
|
299,411 |
|
|
|
|
46,909,357 |
|
|
|
47,563,500 |
|
|
|
|
|
|
|
|
|
|
PROPERTY AND EQUIPMENT,
NET: |
|
|
696,812 |
|
|
|
615,837 |
|
|
|
|
|
|
|
|
|
|
OTHER ASSETS: |
|
|
|
|
|
|
|
|
Intangible Assets - Customer Lists, Net |
|
|
3,979,824 |
|
|
|
1,929,294 |
|
Right of Use Asset - Office Leases |
|
|
942,728 |
|
|
|
1,094,778 |
|
|
|
|
4,922,552 |
|
|
|
3,024,072 |
|
|
|
$ |
52,528,721 |
|
|
$ |
51,203,409 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDER'S EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
|
|
|
|
|
Current Portion of Contingent Earn-Out Liabilities |
|
$ |
1,598,635 |
|
|
$ |
665,855 |
|
Current Obligation under Right of Use Asset - Office Leases |
|
|
319,532 |
|
|
|
310,095 |
|
Accounts Payable and Accrued Expenses |
|
|
1,788,382 |
|
|
|
4,983,496 |
|
Accrued Payroll and Related |
|
|
779,985 |
|
|
|
836,915 |
|
Unearned Revenue |
|
|
1,626,145 |
|
|
|
721,608 |
|
Rewards Program Liability |
|
|
3,918,878 |
|
|
|
43,878 |
|
Sales Tax Payable |
|
|
271,461 |
|
|
|
106,824 |
|
Note Payable - Wildman |
|
|
162,358 |
|
|
|
162,358 |
|
|
|
|
10,465,376 |
|
|
|
7,831,029 |
|
|
|
|
|
|
|
|
|
|
LONG-TERM LIABILITIES: |
|
|
|
|
|
|
|
|
Long-Term Contingent Earn-Out Liability |
|
|
1,241,052 |
|
|
|
976,078 |
|
Long-Term Obligation under Right of Use Asset - Office Leases |
|
|
623,196 |
|
|
|
784,683 |
|
|
|
|
1,864,248 |
|
|
|
1,760,761 |
|
|
|
|
|
|
|
|
|
|
STOCKHOLDER'S EQUITY: |
|
|
|
|
|
|
|
|
Common Stock, $.0001 Par Value; 300,000,000 Shares Authorized,
19,139,330 and 19,753,852 Shares Issued and Outstanding as of June
30, 2022 and December 31, 2021, respectively |
|
|
1,915 |
|
|
|
1,976 |
|
Additional Paid-In Capital |
|
|
39,328,445 |
|
|
|
39,747,649 |
|
Retained Earnings |
|
|
868,737 |
|
|
|
1,861,994 |
|
|
|
|
40,199,097 |
|
|
|
41,611,619 |
|
|
|
$ |
52,528,721 |
|
|
$ |
51,203,409 |
|
|
|
CONDENSED CONSOLIDATED STATEMENTS OF
EARNINGS (LOSS) AND RETAINED EARNINGS THREE AND
SIX MONTHS ENDED JUNE 30, 2022 AND
2021(UNAUDITED)
|
|
Three MonthsEndedJune 30,2022 |
|
|
Three MonthsEndedJune 30,2021 |
|
|
Six
MonthsEndedJune 30,2022 |
|
|
Six
MonthsEndedJune 30,2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SALES |
|
$ |
14,806,904 |
|
|
$ |
8,583,201 |
|
|
$ |
27,066,487 |
|
|
$ |
16,127,392 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COST OF SALES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchases |
|
|
9,497,551 |
|
|
|
5,538,100 |
|
|
|
17,454,167 |
|
|
|
10,073,333 |
|
Freight |
|
|
1,549,163 |
|
|
|
900,394 |
|
|
|
2,633,965 |
|
|
|
1,617,644 |
|
|
|
|
11,046,714 |
|
|
|
6,438,494 |
|
|
|
20,088,132 |
|
|
|
11,690,977 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GROSS PROFIT |
|
|
3,760,190 |
|
|
|
2,144,707 |
|
|
|
6,978,355 |
|
|
|
4,436,415 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING EXPENSES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and Administrative Expenses |
|
|
4,232,170 |
|
|
|
2,998,574 |
|
|
|
8,256,388 |
|
|
|
5,644,031 |
|
|
|
|
4,232,170 |
|
|
|
2,998,574 |
|
|
|
8,256,388 |
|
|
|
5,644,031 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LOSS FROM OPERATIONS |
|
|
(471,980 |
) |
|
|
(853,867 |
) |
|
|
(1,278,033 |
) |
|
|
(1,207,616 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER INCOME AND
(EXPENSE): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Expense |
|
|
(23,781 |
) |
|
|
- |
|
|
|
(27,461 |
) |
|
|
- |
|
Other Income |
|
|
8,519 |
|
|
|
770,062 |
|
|
|
99,114 |
|
|
|
770,062 |
|
Interest Expense |
|
|
(2,411 |
) |
|
|
(26,944 |
) |
|
|
(6,142 |
) |
|
|
(39,806 |
) |
|
|
|
(17,673 |
) |
|
|
743,118 |
|
|
|
65,511 |
|
|
|
730,256 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LOSS BEFORE INCOME TAXES |
|
|
(489,653 |
) |
|
|
(110,749 |
) |
|
|
(1,212,522 |
) |
|
|
(477,360 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROVISION FOR INCOME
TAXES |
|
|
(42,210 |
) |
|
|
58,140 |
|
|
|
(219,265 |
) |
|
|
(18,386 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET LOSS |
|
|
(447,443 |
) |
|
|
(168,889 |
) |
|
|
(993,257 |
) |
|
|
(458,974 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET EARNINGS PER COMMON
SHARE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
(0.02 |
) |
|
$ |
(0.02 |
) |
|
$ |
(0.05 |
) |
|
$ |
(0.05 |
) |
Diluted |
|
$ |
(0.01 |
) |
|
$ |
(0.02 |
) |
|
$ |
(0.03 |
) |
|
$ |
(0.05 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED-AVERAGE COMMON SHARES
OUTSTANDING |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
19,971,552 |
|
|
|
10,000,000 |
|
|
|
19,971,552 |
|
|
|
10,000,000 |
|
Diluted |
|
|
31,683,717 |
|
|
|
10,000,000 |
|
|
|
31,683,717 |
|
|
|
10,000,000 |
|
Stran (NASDAQ:STRNW)
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De May 2024 a Jun 2024
Stran (NASDAQ:STRNW)
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