UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
N/A | N/A | N/A |
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)) | |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934 |
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. ☐ |
SECTION 2 – FINANCIAL INFORMATION
ITEM 2.02 – Results of Operations and Financial Condition.
On November 9, 2023, Koil Energy Solutions, Inc. issued a press release announcing its financial results for the three and nine months ended September 30, 2023. A copy of the press release is furnished as Exhibit 99.1 to this report and is incorporated herein by reference.
SECTION 9 – FINANCIAL STATEMENTS AND EXHIBITS
ITEM 9.01 – Financial Statements and Exhibits.
(d) Exhibits:
99.1 | Press Release issued by Koil Energy Solutions, Inc. dated November 09, 2023 |
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
2 |
SIGNATURES
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 thereunto duly authorized.
Date: November 13, 2023
KOIL ENERGY SOLUTIONS, INC. | ||
By: |
/s/ Charles K. Njuguna | |
Charles K. Njuguna | ||
President, Chief Executive Officer and Chief Financial Officer |
3 |
Exhibit 99.1
Koil Energy Solutions, Inc. Announces Third Quarter 2023 Results
Houston, TX – November 9, 2023 – Koil Energy Solutions, Inc. (OTCQB: KLNG) (“Koil Energy” or the “Company”), a specialist in deepwater production and distribution equipment and services, today reported results for the quarter ended September 30, 2023.
Koil Energy at a Glance:
Share Price†: | $0.45 | Cash* | $1.1M |
52-Week Range†: | $0.42 - $0.72 | Book Value*: | $6.5M |
Shares Out.†: | 11.9M | Price / Book Value: | 0.8x |
Market Cap†: | $5.4M | TTM Revenue: | $15.0M |
*As of 09/30/23; †As of 11/08/23 |
Charles Njuguna, Koil Energy’s CEO, commented, “While our earnings for the third quarter didn’t live up to our expectations, we are encouraged by our increased revenues for the quarter. Compared to the same quarter a year ago, revenues increased by 82% and were driven by sustained growth in service projects and our expanding backlog of product-oriented, fixed price contracts. This heightened level of project activity also drove the year-over-year improvement in modified EBITDA of $1 million.
“We believe the fundamentals of the offshore oil and gas markets remain compelling for our business. The durability of the current growth cycle for the oil and gas industry is motivating operators to continue investing in offshore developments. This translates to an increased level of bidding requests from our customers, and as a result, we have recently received several contract awards involving the design, engineering, and manufacturing of hose and steel tube flying leads and electrical and hydraulic distribution manifolds for various locations in the Gulf of Mexico. These recent orders caused our project backlog to grow by approximately fifty percent when compared to this time last year.
"While we have more work to do, we are determined to build on this momentum to further drive efficiencies throughout the organization to better manage cash flow, preserve liquidity, and stay true to our commitments. We are confident our streamlined operations and continued focus on our core strengths will allow us to increase productivity and steadily grow investment in our people, products, and technologies."
Operating Results
Koil Energy’s revenues for the three months ended September 30, 2023 (“Q3 2023”) of $4.1 million represent an 82% increase when compared to revenues of $2.3 million for the three months ended September 30, 2022 (“Q3 2022”). Gross profit for Q3 2023 was $1.4 million, or 33 percent of revenues, compared to Q3 2022 gross profit of $0.3 million, or 12 percent of revenues. The comparative improvement in Q3 2023 results reflects an increase in both service projects and product-oriented, fixed priced projects as well as the impact of lower rent expense.
Total operating expenses were $1.6 million, or 39 percent of revenues, in Q3 2023 compared to $1.7 million, or 75 percent of revenues, in Q3 2022. The $0.1 million, or 7 percent, decrease in operating expenses was mainly due to relocation costs incurred by the Company in Q3 2022 that were not repeated in Q3 2023. This decrease was partially offset by higher research and development costs and finance lease payments in Q3 2023 when compared to Q3 2022.
Due to the factors discussed above, Koil Energy reported a Q3 2023 net loss of $0.1 million, or a $0.01 loss per diluted share, compared to a Q3 2022 net loss of $1.6 million, or a $0.13 loss per diluted share. Per share results for Q3 2023 and Q3 2022 are based on 11.89 million weighted average shares outstanding.
Koil Energy reported a modified EBITDA of $17 thousand in Q3 2023 compared to a modified EBITDA of negative $1.0 million in Q3 2022. The increase in modified EBITDA was primarily driven by gross profit improvement associated with the increase in both service project and product-oriented, fixed price project activity in Q3 2023 when compared to Q3 2022.
1 |
Financial Position
At September 30, 2023, working capital totaled $3.4 million, which includes cash of $1.1 million and receivables of $5.5 million. This is compared to $3.6 million of working capital at the beginning of the year, which includes cash of $2.4 million and receivables of $2.9 million. Shareholders’ equity totaled $6.5 million, or approximately $0.55 per common share, at September 30, 2023, compared to $7.1 million, or approximately $0.59 per common share, at the beginning of the year. The Company maintains access to a factoring arrangement with Amegy Bank Business Credit (“Amegy”), and the Company had one factored invoice outstanding with Amegy at September 30, 2023.
About Koil Energy, Inc. (www.koilenergy.com)
Koil Energy Solutions is a leading energy services company offering subsea equipment and support services to the world’s energy and offshore industries. We provide innovative solutions to complex customer challenges presented between the production facility and the energy source. Our core services and technological solutions include distribution system installation support and engineering services, umbilical terminations, loose-tube steel flying leads, and related services. Additionally, Koil Energy’s highly experienced team can support subsea engineering, manufacturing, installation, commissioning, and maintenance projects located anywhere in the world.
Conference Call Details:
Call Dial-in: | 1-833-630-1956 for domestic callers |
1-412-317-1837 for international callers | |
Webcast/Replay URL: | https://edge.media-server.com/mmc/p/24vftbx6 |
Replay: | Available through November 22, 2023 on www.koilenergy.com |
Forward-Looking Statements
Any forward-looking statements in the preceding paragraphs of this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties in that actual results may differ materially from those projected in the forward-looking statements. In the course of operations, we are subject to certain risk factors, competition and competitive pressures, sensitivity to general economic and industrial conditions, international political and economic risks, availability and price of raw materials and execution of business strategy. For further information, please refer to the Company's filings with the Securities and Exchange Commission, copies of which are available from the Company without charge.
Investor Relations:
Trevor Ashurst
ir@koilenergy.com
281-862-2201
2 |
KOIL ENERGY SOLUTIONS, INC.
SUMMARY FINANCIAL DATA
(UNAUDITED)
Comparative Condensed Consolidated Income Statement
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
(In thousands, except per share amounts) | ||||||||||||||||
Revenues | $ | 4,107 | $ | 2,257 | $ | 11,338 | $ | 9,357 | ||||||||
Cost of sales | 2,733 | 1,988 | 7,174 | 6,193 | ||||||||||||
Gross profit | 1,374 | 269 | 4,164 | 3,164 | ||||||||||||
Total operating expenses | 1,582 | 1,692 | 4,887 | 4,894 | ||||||||||||
Operating loss | (208 | ) | (1,423 | ) | (723 | ) | (1,730 | ) | ||||||||
Total other expense (income) | (68 | ) | 152 | (58 | ) | (83 | ) | |||||||||
Loss before income tax expense | (140 | ) | (1,575 | ) | (665 | ) | (1,647 | ) | ||||||||
Income tax expense | 3 | 4 | 8 | 19 | ||||||||||||
Net loss | $ | (143 | ) | $ | (1,579 | ) | $ | (673 | ) | $ | (1,666 | ) | ||||
Net loss per share, basic and diluted | $ | (0.01 | ) | $ | (0.13 | ) | $ | (0.06 | ) | $ | (0.14 | ) | ||||
Weighted-average shares outstanding, basic and diluted | 11,888 | 11,888 | 11,888 | 12,012 |
Comparative Condensed Consolidated Balance Sheets
September 30, | December 31, | |||||||
2023 | 2022 | |||||||
(In thousands) | ||||||||
Assets: | ||||||||
Cash | $ | 1,132 | $ | 2,353 | ||||
Other current assets | 6,956 | 4,257 | ||||||
PP&E, net | 3,098 | 3,305 | ||||||
Other non-current assets | 6,233 | 6,700 | ||||||
Total assets | $ | 17,419 | $ | 16,615 | ||||
Liabilities: | ||||||||
Current liabilities | 4,735 | 2,989 | ||||||
Other long-term liabilities | 6,200 | 6,518 | ||||||
Total liabilities | 10,935 | 9,507 | ||||||
Stockholders' equity | 6,484 | 7,108 | ||||||
Total liabilities and stockholders' equity | $ | 17,419 | $ | 16,615 |
3 |
KOIL ENERGY SOLUTIONS, INC.
SUMMARY FINANCIAL DATA, CONTINUED
(UNAUDITED)
Modified EBITDA:
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
(In thousands) | ||||||||||||||||
Net loss | $ | (143 | ) | $ | (1,579 | ) | $ | (673 | ) | $ | (1,666 | ) | ||||
(Deduct) Add: Interest (income) expense, net | (7 | ) | 5 | (3 | ) | 10 | ||||||||||
Add: Income tax expense | 3 | 4 | 8 | 19 | ||||||||||||
Add: Depreciation and amortization | 155 | 161 | 461 | 530 | ||||||||||||
Add: Share-based compensation | 9 | – | 49 | 71 | ||||||||||||
Add: Relocation costs | – | 262 | 9 | 291 | ||||||||||||
Add: Loss on sale of asset | – | 147 | (2 | ) | (41 | ) | ||||||||||
Deduct: Reversal of lititgation accrual | – | – | – | (100 | ) | |||||||||||
Modified EBITDA (loss) | $ | 17 | $ | (1,000 | ) | $ | (151 | ) | $ | (886 | ) |
Cash flow data:
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
(In thousands) | ||||||||||||||||
Cash provided by (used in): | ||||||||||||||||
Operating activities | $ | (971 | ) | $ | 1,297 | $ | (733 | ) | $ | 2,077 | ||||||
Investing activities | (148 | ) | (1,194 | ) | (228 | ) | (1,961 | ) | ||||||||
Financing activities | (96 | ) | – | (260 | ) | (250 | ) | |||||||||
Change in cash | $ | (1,215 | ) | $ | 103 | $ | (1,221 | ) | $ | (134 | ) |
4 |
Cover |
Nov. 09, 2023 |
---|---|
Cover [Abstract] | |
Document Type | 8-K |
Amendment Flag | false |
Document Period End Date | Nov. 09, 2023 |
Entity File Number | 000-30351 |
Entity Registrant Name | KOIL ENERGY SOLUTIONS, INC. |
Entity Central Index Key | 0001110607 |
Entity Tax Identification Number | 75-2263732 |
Entity Incorporation, State or Country Code | NV |
Entity Address, Address Line One | 1310 Rankin Road |
Entity Address, City or Town | Houston |
Entity Address, State or Province | TX |
Entity Address, Postal Zip Code | 77073 |
City Area Code | (281) |
Local Phone Number | 517-5000 |
Written Communications | false |
Soliciting Material | false |
Pre-commencement Tender Offer | false |
Pre-commencement Issuer Tender Offer | false |
Entity Emerging Growth Company | false |
-8?20$3;8T.P6BP^0"X99K>]9!:G
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end