0001493152-24-014614.txt : 20240415 0001493152-24-014614.hdr.sgml : 20240415 20240415161522 ACCESSION NUMBER: 0001493152-24-014614 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 16 CONFORMED PERIOD OF REPORT: 20240415 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Regulation FD Disclosure ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20240415 DATE AS OF CHANGE: 20240415 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Dragonfly Energy Holdings Corp. CENTRAL INDEX KEY: 0001847986 STANDARD INDUSTRIAL CLASSIFICATION: MISCELLANEOUS ELECTRICAL MACHINERY, EQUIPMENT & SUPPLIES [3690] ORGANIZATION NAME: 04 Manufacturing IRS NUMBER: 851873463 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-40730 FILM NUMBER: 24844814 BUSINESS ADDRESS: STREET 1: 1190 TRADEMARK DRIVE #108 CITY: RENO STATE: NV ZIP: 89521 BUSINESS PHONE: (775) 622-3448 MAIL ADDRESS: STREET 1: 1190 TRADEMARK DRIVE #108 CITY: RENO STATE: NV ZIP: 89521 FORMER COMPANY: FORMER CONFORMED NAME: Chardan NexTech Acquisition 2 Corp. DATE OF NAME CHANGE: 20210225 8-K 1 form8-k.htm
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): April 15, 2024

 

DRAGONFLY ENERGY HOLDINGS CORP.

(Exact name of registrant as specified in its charter)

 

Nevada   001-40730   85-1873463

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

 

1190 Trademark Drive, #108

Reno, Nevada

  89521
(Address of principal executive offices)   (Zip Code)

 

(775) 622-3448

Registrant’s telephone number, including area code

 

N/A

(Former name or former address, if changed since last report.)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
   
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
   
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
   
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbol(s)   Name of each exchange on which registered
Common stock, par value $0.0001 per share   DFLI   The Nasdaq Global Market
Redeemable warrants, exercisable for common stock at an exercise price of $11.50 per share, subject to adjustment   DFLIW   The Nasdaq Capital Market

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

 

 

 
 

 

Item 2.02. Results of Operations and Financial Condition.

 

On April 15, 2024, Dragonfly Energy Holdings Corp. (the “Company”) issued an earnings release disclosing certain information regarding its results of operations for the fourth quarter and year ended December 31, 2023. As previously announced, following the publication of the press release, the Company will host an earnings call at 5:00 p.m. (Eastern Time) on April 15, 2024, via a webcast. During the webcast, the Company’s financial results for the fourth quarter and year ended December 31, 2023 will be discussed. A copy of the press release is attached as Exhibit 99.1 hereto and incorporated in this Item 2.02 by reference.

 

Item 7.01. Regulation FD Disclosure.

 

See “Item 2.02 Results of Operation and Financial Condition” above.

 

The information in this Current Report on Form 8-K under Items 2.02 and 7.01, including the information contained in Exhibit 99.1, is being furnished to the Securities and Exchange Commission (the “SEC”), and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, and shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by a specific reference in such filing.

 

Item 9.01. Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit No.   Description
99.1   Press Release of Dragonfly Energy Holdings Corp., dated April 15, 2024.
104   Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

 
 

 

Signature

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  DRAGONFLY ENERGY HOLDINGS CORP.
     
Dated: April 15, 2024 By: /s/ Denis Phares
  Name: Denis Phares
  Title: Chief Executive Officer, Interim Chief Financial Officer and President

 

 

 

EX-99.1 2 ex99-1.htm

 

Exhibit 99.1

 

 

Dragonfly Energy Reports Fourth Quarter 2023 and Full Year Financial Results

 

Successful diversification of revenue underway, with launch in Q4 2023 of all-electric auxiliary power units (“APU”) to the trucking industry; Enables compliance with increasing anti-idling regulations, reduction in fuel costs, increased uptime and payloads, and the reduction of harmful emissions

 

In Q4 2023, achieved successful deposition of cathode electrodes, and double-sided dry deposition of both anode and cathode electrodes, at scale, using the Company’s patented dry electrode battery manufacturing process
   
  Continued expansion of recreational vehicle market share, with OGV Luxury Coach, a division of Forest River Inc., to provide Battle Born lithium batteries as standard equipment on all OGV units

 

RENO, NEVADA (April 15, 2024) — Dragonfly Energy Holdings Corp. (“Dragonfly Energy” or the “Company”) (Nasdaq: DFLI), maker of Battle Born Batteries® and an industry leader in energy storage, today reported its financial and operational results for the fourth quarter and full year ended December 31, 2023.

 

Fourth Quarter 2023 Financial Highlights

 

Net Sales were $10.4 million, compared to $20.2 million in Q4 2022
Gross Profit was $2.0 million, compared to $4.0 million in Q4 2022
Operating expenses were $(5.4) million, compared to $(32.9) million in Q4 2022
Net Income of $3.0 million, compared to a Net Loss of $(32.5) million in Q4 2022
Diluted Net Income per share was $0.05, compared to a Net Loss of $(0.76) per share in Q4 2022
EBITDA was $7.4 million, compared to $(28.0) million in Q4 2022
Adjusted EBITDA was $(2.1) million, compared to $(4.7) million in Q4 2022

 

Full Year 2023 Financial Highlights

 

Net Sales of $64.4 million, compared to $86.3 million in 2022
Gross Profit of $15.4 million, compared to $23.6 million in 2022
Operating expenses of $(42.9) million, compared to $(58.0) million in 2022
EBITDA for the full year 2023 was $3.4 million, compared to $(32.8) million in 2022
Adjusted EBITDA for the full year 2023 was $(17.1) million, compared to $(7.9) million in 2022

 

Operational and Business Highlights

 

Announced expanded market share with inclusion as standard equipment by recreational vehicle (“RV”) giant, Forest River (link)
Announced the John Lennon Educational Tour Bus is now powered by Battle Born Batteries, moving the nonprofit mobile recording studio toward improved sustainability (link)
Announced partnership with Ameresco to boost renewable energy and power system applications (link)
Announced Coachmen RVs will include Battle Born Batteries as an optional upgrade on its Entourage Class C Motorhomes (link)
Announced entrance into heavy-duty trucking market, with new Battle Born All-Electric APU, enabling reduced fuel costs, increased uptime and payload, and lower harmful emissions (link)
Announced successful cathode electrode dry deposition, at scale, for American made lithium batteries (link)

 

 
 

 

“Despite the near-term growth and market headwinds, we have continued to execute and achieve our stated targets and milestones,” said Denis Phares, Chief Executive Officer of Dragonfly Energy. “In 2023, we completed the pilot line for our patented chemistry-agnostic dry deposition process, proving that we could produce anode and cathode materials at scale, and are now in the process of delivering sample battery cells to customers across several different industries and markets. We are extremely excited about 2024 as the convergence of the new cell manufacturing, the expansion of our customer base and market segments, and the stabilization and return to growth of the RV markets sets the stage for an expected return to growth.”

 

Fourth Quarter and Full Year 2022 Financial and Operating Results

 

Fourth quarter 2023 Net Sales were $10.4 million, compared to $20.2 million in the fourth quarter of 2022. Full year 2023 Net Sales were $64.4 million, compared to $86.3 million in 2022. Direct-To-Consumer (“DTC”) revenue decreased by $15.6 million as a result of decreased customer demand, particularly in the RV market, due to rising interest rates and inflation.

 

Fourth quarter 2023 Gross Profit was $2.0 million, compared to $4.0 million in the fourth quarter of 2022. Full year 2023 Gross Profit was $15.4 million, down from $23.6 million in 2023. The year-over-year decline in 2023 gross profit was primarily driven by lower unit volume sales, a change in revenue mix that included a larger percentage of lower margin OEM sales, as well as higher material costs.

 

Operating Expenses in the fourth quarter of 2023 were $(5.4) million, compared to $(32.9) million in the fourth quarter of 2022. Full year 2023 Operating Expenses were $(42.9) million, down from $(58.0) million. The decrease was primarily driven by the absence of expenses associated with the Business Combination in 2022 and lower overall employee-related costs, partially offset by an increase in stock-based compensation costs, as well as higher compliance, insurance, and professional fees related to public company costs.

 

Total Other Income in the fourth quarter of 2023 was $6.3 million, compared to a Total Other Expense of $(2.7) million in the prior year quarter. Other Income for fiscal 2023 was approximately $13.6 million, compared to an Other Expenses of $(6.3) million in 2022. The income contribution in 2023 was primarily due to a change in fair market value of a warrant liability in the amount of $29.6 million, partially offset by interest expense of $16.0 million.

 

The Company had Net Income of $3.0 million, or $0.05 per diluted share in the fourth quarter of 2023, compared to a Net Loss of $(32.5) million or $(0.76) per diluted share in the prior year quarter. For the full year 2023, the Company had a Net Loss of $(13.8) million, or $(0.26) per diluted share, compared to a Net Loss of $(40.0) million or $(1.04) per diluted share for the full year 2022. The full year results were driven by reduced demand in the RV market, partially offset by lower cost of goods sold, lower operating expenses and increased other income.

 

EBITDA in the fourth quarter of 2023 was $7.4 million, compared to a negative $(28.0) million in the fourth quarter of 2022. Full year 2023 EBITDA totaled $3.4 million, compared to a negative $(32.8) million in 2022.

 

In the fourth quarter of 2023, Adjusted EBITDA excluding stock-based compensation, changes in the fair market value of our warrants, and other one-time expenses, was a negative $(2.1) million, compared to a negative $(4.7) million for the fourth quarter of 2022.

 

For the full year 2023, Adjusted EBITDA excluding stock-based compensation, changes in the fair market value of Dragonfly Energy’s warrants, and other one-time expenses, was a negative $(17.1) million, compared to negative $(7.9) million for the year ended December 31, 2022.

 

Q1 2024 Outlook

 

The Company believes that the RV market appears to have stabilized and is showing early signs of recovery. In addition, the Company’s entry into the heavy-duty trucking market, while still in its early stages, is gaining traction and has the potential to be a more meaningful revenue contributor in the second half of 2024.

 

Net Sales are expected to range between $12.0 - $13.0 million
Gross Margin is expected in the range of 24.0% - 26.0%
Operating Expenses are expected to be in a range of $(8.0) - $(9.0) million
Other Income (Expense) is expected be an expense in the range of $(3.5) – $(4.5) million
Net Loss is expected to be between $(8.0) - $(10.5) million for the first quarter of 2024, or $(0.13) - $(0.17) per share based on approximately 61.0 million shares outstanding

 

 
 

 

Webcast Information

 

The Dragonfly Energy management team will host a conference call to discuss its fourth quarter and full year 2023 financial results this afternoon, Monday, April 15, 2024, at 5:00 pm E.T. The call can also be accessed live via live webcast by clicking here, or through the Events and Presentations page within the Investor Relations section of Dragonfly Energy’s website at https://investors.dragonflyenergy.com/events-and-presentations/default.aspx. The call can also be accessed live via telephone by dialing (206) 962-3782, toll-free in North America (888) 259-6580, or for international callers +1 (416) 764-8624, and referencing conference ID: 94560450. Please log in to the webcast or dial in to the call at least 10 minutes prior to the start of the event.

 

An archive of the webcast will be available for a period of time shortly after the call on the Events and Presentations page on the Investor Relations section of Dragonfly Energy’s website, along with the earnings press release.

 

About Dragonfly Energy

 

Dragonfly Energy Holdings Corp. (Nasdaq: DFLI) is a comprehensive lithium battery technology company, specializing in cell manufacturing, battery pack assembly, and full system integration. Through its renowned Battle Born Batteries® brand, Dragonfly Energy has established itself as a frontrunner in the lithium battery industry, with hundreds of thousands of reliable battery packs deployed in the field through top-tier OEMs and a diverse retail customer base. At the forefront of domestic lithium battery cell production, Dragonfly Energy’s patented dry electrode manufacturing process can deliver chemistry-agnostic power solutions for a broad spectrum of applications, including energy storage systems, electric vehicles, and consumer electronics. The Company’s overarching mission is the future deployment of its proprietary, nonflammable, all-solid-state battery cells.

 

To learn more about Dragonfly Energy and its commitment to clean energy advancements, visit www.dragonflyenergy.com/investors.

 

Forward-Looking Statements

 

This press release contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that are not historical statements of fact and statements regarding the Company’s intent, belief or expectations, including, but not limited to, statements regarding the Company’s guidance for 2024 results of operations and financial position, planned products and services, business strategy and plans, market size and growth opportunities, competitive position and technological and market trends. Some of these forward-looking statements can be identified by the use of forward-looking words, including “may,” “should,” “expect,” “intend,” “will,” “estimate,” “anticipate,” “believe,” “predict,” “plan,” “targets,” “projects,” “could,” “would,” “continue,” “forecast” or the negatives of these terms or variations of them or similar expressions.

 

These forward-looking statements are subject to risks, uncertainties, and other factors (some of which are beyond the Company’s control) which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Factors that may impact such forward-looking statements include, but are not limited to: improved recovery in the Company’s core markets, including the RV market; the Company’s ability to successfully increase market penetration into target markets; the Company’s ability to penetrate the heavy-duty trucking and other new markets; the growth of the addressable markets that the Company intends to target; the Company’s ability to retain members of its senior management team and other key personnel; the Company’s ability to maintain relationships with key suppliers including suppliers in China; the Company’s ability to maintain relationships with key customers; the Company’s ability to access capital as and when needed under its $150 million ChEF Equity Facility; the Company’s ability to protect its patents and other intellectual property; the Company’s ability to successfully utilize its patented dry electrode battery manufacturing process and optimize solid state cells as well as to produce commercially viable solid state cells in a timely manner or at all, and to scale to mass production; the Company’s ability to achieve the anticipated benefits of its customer arrangements with THOR Industries and THOR Industries’ affiliated brands (including Keystone RV Company); the impact of the coronavirus disease pandemic, including any mutations or variants thereof and/or the Russian/Ukrainian conflict; the Company’s ability to generate revenue from future product sales and its ability to achieve and maintain profitability; and the Company’s ability to compete with other manufacturers in the industry and its ability to engage target customers and successfully convert these customers into meaningful orders in the future. These and other risks and uncertainties are described more fully in the sections entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 to be filed with the SEC and in the Company’s subsequent filings with the SEC available at www.sec.gov.

 

If any of these risks materialize or any of the Company’s assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that the Company presently does not know or that it currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. All forward-looking statements contained in this press release speak only as of the date they were made. Except to the extent required by law, the Company undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made.

 

Investor Relations:

Sioban Hickie

DragonflyIR@icrinc.com

+1 (775) 221-8892

 

 
 

 

Dragonfly Energy Holdings Corp.

Unaudited Condensed Consolidated Balance Sheets

(U.S. Dollars in Thousands, except share and per share data)

 

  

December 31,

2023

  

December 31,

2022

 
Current Assets          
Cash and cash equivalents  $12,713   $17,781 
Accounts receivable, net of allowance for credit losses   1,639    1,444 
Inventory   38,778    50,189 
Prepaid expenses   772    1,624 
Prepaid inventory   1,381    2,002 
Prepaid income tax   519    525 
Other current assets   118    267 
Total Current Assets   55,920    73,832 
Property and Equipment          
Machinery and equipment   16,714    10,214 
Office furniture and equipment   319    275 
Leasehold improvements   1,727    1,709 
Vehicle   33    195 
Total   18,793    12,393 
Less accumulated depreciation   (2,824)   (1,633)
Property and Equipment   15,969    10,760 
Operating lease right of use asset, net   3,315    4,513 
Total Assets  $75,204   $89,105 
           
Current Liabilities          
Accounts payable  $10,258   $13,475 
Accrued payroll and other liabilities   7,107    6,250 
Accrued tariffs   1,713    932 
Customer deposits   201    238 
Uncertain tax position liability   91    128 
Notes payable, current portion, net of debt issuance costs   19,683    19,242 
Operating lease liability, current portion   1,288    1,188 
Financing lease liability, current portion   36    10 
Total Current Liabilities   40,377    41,463 
Long-Term Liabilities          
Warrant liabilities   4,463    32,831 
Accrued expenses-long term   152    492 
Operating lease liability, net of current portion   2,234    3,541 
Financing lease liability, net of current portion   66    35 
Total Long-Term Liabilities   6,915    36,899 
Total Liabilities   47,292    78,362 
           
Stockholders’ Equity          
Preferred stock, 5,000,000 shares at $0.0001 par value, authorized, no shares issued and outstanding as of December 31, 2023 and 2022, respectively   -    - 
Common stock, 250,000,000 shares at $0.0001 par value, authorized, 60,260,282 and 43,272,728 shares issued and outstanding as of December 31, 2023 and 2022, respectively   6    4 
Additional paid in capital   69,445    38,461 
Accumulated Deficit   (41,539)   (27,722)
Total Stockholders’ Equity   27,912    10,743 
Total Liabilities and Stockholders’ Equity  $75,204   $89,105 

 

 
 

 

Dragonfly Energy Holdings Corp.

Reconciliation of GAAP to Non-GAAP Measures (Unaudited)

(U.S. Dollars in Thousands)

 

   Three Months Ended   Year Ended  
   December 31, 2023   December 31, 2022   December 31, 2023     December 31, 2022  
                       
Net Sales  $ 10,438     $ 20,209    $ 64,392     $ 86,251  
                               
Cost of Goods Sold    8,405       16,152      48,946       62,633  
                               
Gross Profit    2,033       4,057      15,446       23,618  
                               
Operating Expenses                              
Research and development    531       813      3,863       2,764  
General and administrative    3,275       27,788      26,389       41,566  
Selling and marketing    1,548       4,340      12,623       13,671  
                               
Total Operating Expenses    5,354       32,941      42,875       58,001  
                               
Loss From Operations    (3,321 )     (28,884 )    (27,429 )     (34,383 )
                               
Other Income (Expense)                               
Other income (expense)    19       40      19       40  
Interest expense, net    (4,110 )     (3,322 )    (16,015 )     (6,979 )
Change in fair market value of warrant liability    10,400       5,446      29,582       5,446  
Debt extinguishment          (4,824 )          (4,824 ) 
Total Other Income (Expense)     6,309       (2,660 )    13,586       (6,317 )
                               
Loss Before Taxes    2,988       (31,544 )    (13,843 )     (40,700 )
                               
Income Tax Benefit     (26 )     991      (26 )     (709 )
                               
Net Loss  $ 3,014     $ (32,535 )  $ (13,817 )   $ (39,991 )
                               
Income (Loss) Per Share- Basic  $ 0.05     $ (0.76 )  $ (0.26 )   $ (1.04 )
Income (Loss) Per Share- Diluted  $ 0.05     $ (0.76 )  $ (0.26 )   $ (1.04 )
Weighted Average Number of Shares- Basic    59,590,032       42,948,026      52,786,481       38,565,307  
Weighted Average Number of Shares- Diluted    60,597,708       42,948,026      52,786,481       38,565,307  

 

 
 

 

Dragonfly Energy Holdings Corp.

Unaudited Condensed Consolidated Statement of Cash Flows

(U.S. Dollars in Thousands)

 

    Year Ended  
    December 31, 2023     December 31, 2022  
Cash Flows From Operating Activities                
Net Loss   $ (13,817 )   $ (39,991 )
Adjustments to Reconcile Net Loss to Net Cash                
Used in Operating Activities                
Stock based compensation     6,710       2,467  
Debt extinguishment     -       4,824  
Assumption of warrant liability     -       1,990  
Amortization of debt discount     1,470       1,822  
Change in fair market value of warrant liability     (29,582 )     (5,446 )
Deferred tax liability     -       (453 )
Non-cash interest expense (paid-in-kind)     4,938       1,192  
Provision for credit losses     114       108  
Depreciation     1,237       891  
Loss on disposal of property and equipment     116       56  
Write-off of prepaid inventory     596       -  
Changes in Assets and Liabilities                
Accounts receivable     (309 )     (769 )
Inventories     11,411       (22,732 )
Prepaid expenses     852       (1,467 )
Prepaid inventory     25       5,459  
Other current assets     149       1,520  
Other assets     1,198       1,196  
Income taxes payable     6       (1,156 )
Accounts payable and accrued expenses     (3,527 )     4,428  
Accrued tariffs     781       433  
Uncertain tax position liability     (37 )     128  
Customer deposits     (37 )     (196 )
Total Adjustments     (3,889 )     (5,705 )
Net Cash Used in Operating Activities     (17,706 )     (45,696 )
                 
Cash Flows From Investing Activities                
Proceeds from disposal of property and equipment     -       35  
Purchase of property and equipment     (6,885 )     (6,862 )
Net Cash Used in Investing Activities     (6,885 )     (6,827 )
                 
Cash Flows From Financing Activities                
Proceeds from public offering     24,177       -  
Payments from public offering costs     (1,258 )     -  
Proceeds from note payable, related party     1,000       -  
Repayment of note payable, related party     (1,000 )     -  
Proceeds from term loan     -       75,000  
Repayment of note payable     (5,275 )     (45,000 )
Proceeds from exercise of public warrants     747       -  
Payment of debt issuance costs     -       (4,032 )
Proceeds from exercise of options     586       706  
Proceeds from stock purchase agreement     -       15,000  
Proceeds from exercise of investor warrants     546       -  
Net Cash Provided by Financing Activities     19,523       41,674  
                 
Net Decrease in cash and cash equivalents     (5,068 )     (10,849 )
Cash and cash equivalents - beginning of year     17,781       28,630  
Cash and cash equivalents - end of year   $ 12,713     $ 17,781  

 

 
 

 

Use of Non-GAAP Financial Measures

 

The Company provides non-GAAP financial measures including EBITDA and Adjusted EBITDA as a supplement to GAAP financial information to enhance the overall understanding of the Company’s financial performance and to assist investors in evaluating the Company’s results of operations, period over period. Adjusted non-GAAP measures exclude significant unusual items. Investors should consider these non-GAAP measures as a supplement to, and not a substitute for financial information prepared on a GAAP basis.

 

Adjusted EBITDA

 

Adjusted EBITDA is considered a non-GAAP financial measure under the rules of the SEC because it excludes certain amounts included in net loss calculated in accordance with GAAP. Specifically, the Company calculates Adjusted EBITDA by GAAP net loss adjusted to exclude stock-based compensation expense, business combination related expenses and other one-time, non-recurring items.

 

The Company has included Adjusted EBITDA because it is a key measure used by Dragonfly’s management team to evaluate its operating performance, generate future operating plans, and make strategic decisions, including those relating to operating expenses. As such, the Company believes Adjusted EBITDA is helpful in highlighting trends in the ongoing core operating results of the business.

 

Adjusted EBITDA has limitations as an analytical tool, and it should not be considered in isolation or as a substitute for analysis of net loss or other results as reported under GAAP. Some of these limitations are:

 

  Adjusted EBITDA does not reflect the Company’s cash expenditures, future requirements for capital expenditures, or contractual commitments;
     
  Adjusted EBITDA does not reflect changes in, or cash requirements for, the Company’s working capital needs;
     
  Adjusted EBITDA does not reflect the Company’s tax expense or the cash requirements to pay taxes;
     
  although amortization and depreciation are non-cash charges, the assets being amortized and depreciated will often have to be replaced in the future and Adjusted EBITDA does not reflect any cash requirements for such replacements;
     
  Adjusted EBITDA should not be construed as an inference that the Company’s future results will be unaffected by unusual or non-recurring items for which the Company may adjust in historical periods; and
     
 

other companies in the industry may calculate Adjusted EBITDA differently than the Company does, limiting its usefulness as a comparative measure.

 

Reconciliations of Non-GAAP Financial Measures

 

EBITDA and Adjusted EBITDA

 

The following table presents reconciliations of EBITDA and Adjusted EBITDA to the most directly comparable GAAP financial measure for each of the periods indicated.

 

 
 

 

Dragonfly Energy Holdings Corp.
Reconciliation of GAAP to Non-GAAP Measures (Unaudited)
(U.S. Dollars in Thousands)

 

   Three Months Ended   Year Ended 
   December 31, 2023   December 31, 2022   December 31, 2023   December 31, 2022 
                 
Net (loss)   $ 3,014     $ (32,535 )   $ (13,817 )   $ (39,991 )
Interest Expense     4,110       3,322       16,015       6,979  
Taxes     (26 )     991       (26 )     (709 )
Depreciation     328       243       1,237       891  
EBITDA  $7,426   $(27,979)  $3,409   $(32,830)
Adjusted for:                    
Stock Based Compensation(1)   323    1,312    6,710    2,467 
June 2023 Offering Costs(2)   -    -    904    - 
Promissory Note Forgiveness(3)   -    -    -    469 
Loss on Disposal of Assets   596    56    712    56 
Separation Agreement(4)   -    1,197    720    1,197 
Business Combination Expenses(5)   -    21,337    -    21,337 
Debt Extinguishment(6)   -    4,824    -    4,824 
Change in fair market value of warrant liability(7)   (10,400)   (5,446)   (29,582)   (5,446)
Adjusted EBITDA  $(2,055)  $(4,699)  $(17,127)  $(7,926)

 

  (1) Stock-Based Compensation is comprised of costs associated with option and RSU grants made to the Company’s employees, consultants and board members.
  (2) June 2023 Offering Costs related to the warrant liability are comprised of fees and expenses, including legal, accounting and other expenses associated with this offering.
  (3) Promissory Note Foregiveness is comprised of the loan that was forgiven, prior to the Business Combination, in connection with the promissory note, with a maturity date of March 1, 2026, between the Company and John Marchetti, its Senior Vice President of Operations and former Chief Financial Officer.
  (4) Separation Agreement in 2022 is comprised of $1.2 million in cash severance associated with the Separation Agreement dated October 25, 2022, as amended on November 14, 2022 between the Company and Sean Nichols, its former Chief Operating Officer. Seperation Agreement in 2023 is comprised of $720 in cash severance associated with the Separation Agreement dated April 26, 2023, between the Company and its former Chief Legal Officer.
  (5) Business Combination Expenses is comprised of fees and expenses, including legal, accounting and other expenses asscociated with the Business Combination.
  (6) Debt Extinguishment expenses are comprised of expenses incurred in connection with the early debt repayment of the Series 2021-6 Notes that occurred in conjunction with the Business Combination.
  (7) Change in fair market value of warrant liability represents the change in fair value from the date the warrants were issued through December 31, 2023.

 

Source: Dragonfly Energy Holdings Corp.

 

 

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Cover
Apr. 15, 2024
Document Type 8-K
Amendment Flag false
Document Period End Date Apr. 15, 2024
Entity File Number 001-40730
Entity Registrant Name DRAGONFLY ENERGY HOLDINGS CORP.
Entity Central Index Key 0001847986
Entity Tax Identification Number 85-1873463
Entity Incorporation, State or Country Code NV
Entity Address, Address Line One 1190 Trademark Drive, #108
Entity Address, City or Town Reno
Entity Address, State or Province NV
Entity Address, Postal Zip Code 89521
City Area Code (775)
Local Phone Number 622-3448
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company true
Elected Not To Use the Extended Transition Period false
Common stock, par value $0.0001 per share  
Title of 12(b) Security Common stock, par value $0.0001 per share
Trading Symbol DFLI
Security Exchange Name NASDAQ
Redeemable warrants, exercisable for common stock at an exercise price of $11.50 per share, subject to adjustment  
Title of 12(b) Security Redeemable warrants, exercisable for common stock at an exercise price of $11.50 per share, subject to adjustment
Trading Symbol DFLIW
Security Exchange Name NASDAQ
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