EX-99.1 15 ea020160001ex99-1_psqhold.htm EARNINGS PRESS RELEASE, DATED MARCH 14, 2024

Exhibit 99.1

 

 

 

PublicSquare Reports Year-End 2023 Financial Results

 

Increased Year Over Year Net Revenue by 12x

 

Provides 2024 Outlook

 

WEST PALM BEACH, Fla, March 14, 2024 — PSQ Holdings, Inc. (NYSE: PSQH) (“PublicSquare,” or the “Company”), a leading marketplace of patriotic, pro-family businesses and consumers, today announced financial results for the year-end of 2023.

 

Michael Seifert, Chairman and Chief Executive Officer of PublicSquare, commented, “2023 was a tremendous year for PublicSquare as we listed on the NYSE, built a commerce ecosystem for a network of Americans that are looking to spend their hard-earned money with values-aligned brands, and launched our first wholly owned D2C and B2B products. As we enter 2024, we see potential in the business well beyond our initial expectations. By leveraging the power of our total addressable market and growing the parallel economy ecosystem we are working towards our long-term goal of operating as a holdings company. The PublicSquare ecosystem is truly a marketing engine that powers the entirety of our vendor audience. We expect to continue to grow organically and via intentional, low-cost customer acquisition strategies. Our marketplace not only lifts and elevates the businesses on our platform but also serves as a key driver for our wholly-owned brands and subsidiaries, like Credova and EveryLife. Further, with the acquisition of Credova, we are moving closer to our objective of owning the infrastructure that underpins our customer acquisition channel.”

 

FULL-YEAR 2023 HIGHLIGHTS

 

Increased net revenue by 1,097% to $5.7 million compared to the full year 2022 (net of returns & discounts)

 

Increased PublicSquare marketplace revenue by 529% compared to the full year 2022

 

EveryLife, the Company’s wholly-owned baby-care brand, contributed over $2.7 million in new revenue for the full year 2023, of which 70% was subscription-based

 

Increased consumer members by 338% to over 1.6 million at December 31, 2023 as compared to December 31, 2022

 

Increased businesses on the platform by 130% to over 75,000 at December 31, 2023 as compared to December 31, 2022

 

Incurred $6.8 million in one-time transaction costs related to the business combination for the full year 2023

 

Ended the year with $16.4 million in cash

 

Increased marketplace traffic from November 1, 2023, to December 31, 2023, by 549% YOY, achieved Average Order Volume (AOV) >$70, with average engagement time per user up 90% YOY

 

2024 HIGHLIGHTS TO DATE

 

Acquired Credova, the leading buy now, pay later (BNPL) provider for the firearms and shooting sports industry

 

Tucker Carlson’s digital media company, Last Country, Inc., created its first digital monologue highlighting PublicSquare

 

EveryLife launched the successful “Make More Babies” campaign, driving its second-highest-grossing sales week since launch

 

 

 

 

EveryLife partnered with Hobby Lobby to provide new baby gift boxes to Hobby Lobby employees

 

Continued successful town hall series highlighting and supporting local small businesses across the nation participating in the parallel economy

 

Signed professional surfer Bethany Hamilton as an official PublicSquare athlete

 

Anticipated director/affiliate investment from PublicSquare to facilitate accelerated growth and realization of synergies from scaling the payments platform

 

2024 OUTLOOK

 

PublicSquare 2024 Outlook assumes Exit Run Rate Revenue is defined as December 2024 GAAP Revenue annualized (annualized projected revenue of PSQ based on projected revenue for December 2024 times twelve) resulting from the existing businesses.

 

REVENUE

 

Year-End 2024 Exit Run-Rate Revenue of approximately $47 million to $53 million before consideration for merger synergies

 

PROFITABILITY

 

EveryLife to reach and maintain cash flow positivity by the end of 2024

 

Credova adds revenues, expected to remain cash flow positive in 2024 before consideration for synergies

 

PublicSquare will strategically spend on development and marketing to support ongoing growth of marketplace and advertising platforms

 

PRODUCT

 

New EveryLife products launching in 2024

 

New personal product brand launching in 2024

 

Launch development of PSQ Payments Platform to protect merchants from cancellation, building upon existing Credova network

 

Expand through acquisition into adjacent business segments fulfilling merchant and customer demands

 

CASH POSITION

 

Cash generated from profitable segments and proposed investment by PublicSquare directors/affiliates anticipated to support accelerated growth including unlocking transaction synergies and building PSQ Payments platform

 

Expect to exit 2024 with approximately $8 million to $10 million of cash on the consolidated balance sheet

 

Year-end 2023 Prepared Remarks & Discussion

 

Management will host prepared remarks today at 9:00 am ET. The live webcast and replay can be accessed at https://investors.publicsquare.com. PublicSquare has utilized the Say Technologies platform to allow shareholders to submit questions to management in advance of the webcast. Management will respond to previously submitted, top questions that pertain to PublicSquare’s strategic priorities, business operations, financial position, and efforts to continue enhancing the business.

 

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Upcoming Investor Conference

 

PublicSquare will participate in the 36th Annual ROTH Conference taking place on March 17 - 19, 2024 in Laguna Niguel, CA.

 

Michael Seifert, Founder, Chairman and Chief Executive Officer, will present on Tuesday, March 19, 2024, at 12:00 pm PT, and will also be available for meetings during the conference. The presentation will be webcast live and available for replay. The webcast link will be available on the Investor Relations section of the company’s website at https://investors.publicsquare.com.

 

About PublicSquare

 

PublicSquare is an app and website that connects patriotic Americans to high-quality businesses that share their values, both online and in their local communities. The primary mission of the platform is to help consumers “shop their values” and put purpose behind their purchases. In just over one and a half years since its nationwide launch, PublicSquare has seen tremendous growth and proven to the nation that the parallel, “patriotic” economy can be a major force in commerce. The platform has over 75,000 businesses from a variety of different industries and over 1.6 million consumer members. Additionally, PublicSquare leverages data and insights from the platform to assess its members’ needs and provide wholly-owned quality financing products, such as Credova, D2C products, such as EveryLife diapers and wipes, and B2B products, such as PSQLink, to fill those needs. PublicSquare is free to join for both consumers and business owners alike, and to learn more, download the app on the App Store or Google Play, or visit PublicSquare.com.

 

About EveryLife Inc.

 

EveryLife Inc. began with a simple mission: to provide premium products for every baby, because every baby is a miracle from God who deserves to be loved, protected, and supported. At EveryLife, we believe in providing for — and protecting — the next generation. EveryLife Inc. was acquired by PublicSquare in February 2023 and launched on July 13, 2023 as a wholly-owned baby-care brand selling diapers and wipes. To learn more, please visit everylife.com.

 

About Credova

 

Credova offers industry-leading buy now, pay later solutions, empowering consumers with flexible payment options and driving substantial growth for merchants. As a pioneer in the BNPL sector, Credova enables flexible purchasing of items such as firearms, ammunition, and shooting sports accessories, both online and in brick-and-mortar locations. Deeply committed to preserving American freedoms, Credova effortlessly bridges the gap between aspiration and ownership, making essential and leisure items more accessible. Dedicated to nurturing the adventurous American spirit, Credova enriches lives with transparent, adaptable payment solutions, epitomizing a commitment to financial empowerment and traditional values.

 

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Cautionary Statement Regarding Forward-Looking Statements

 

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended, and for purposes of the “safe harbor” provisions under the United States Private Securities Litigation Reform Act of 1995. Any statements other than statements of historical fact contained herein are forward-looking statements. Such forward-looking statements include, but are not limited to, expectations, hopes, beliefs, intentions, plans, prospects, financial results or strategies regarding PublicSquare and Credova, anticipated product launches, our products and markets, future financial condition, expected future performance and market opportunities of PublicSquare and Credova. Forward-looking statements generally are identified by the words “anticipate,” “believe,” “could,” “expect,” “estimate,” “future,” “intend,” “may,” “might,” “strategy,” “opportunity,” “plan,” “project,” “possible,” “potential,” “project,” “predict,” “scales,” “representative of,” “valuation,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions, and in this press release, include statements about the anticipated benefits of the acquisition of Credova; however, the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this communication, including, without limitation: (i) the outcome of any legal proceedings that may be instituted against PublicSquare related to the acquisition of Credova, (ii) unforeseen liabilities, future capital expenditures, revenues, expenses, earnings, synergies, economic performance, indebtedness, financial condition, losses, future prospects, business and management strategies for the management, expansion and growth of the combined company’s operations, including the possibility that any of the anticipated benefits of the transaction will not be realized or will not be realized within the expected time period, (iii) the ability of PublicSquare and Credova to integrate the business successfully and to achieve anticipated synergies and value creation, (iv) changes in the competitive industries and markets in which PublicSquare operates, variations in performance across competitors, changes in laws and regulations affecting PublicSquare’s business and changes in the combined capital structure, (v) the ability to implement business plans, growth, marketplace and other expectations, and identify and realize additional opportunities, (vi) risks related to PublicSquare’s limited operating history, the rollout and/or expansion of its business and the timing of expected business milestones, including Every Life, PSQ Link, E-commerce, the Tucker Carlson partnership and Credova, (vii) risks related to PublicSquare’s potential inability to achieve or maintain profitability and generate significant revenue, (viii) the ability to raise capital on reasonable terms as necessary to develop its products in the timeframe contemplated by PublicSquare’s business plan, (ix) the ability to execute PublicSquare’s anticipated business plans and strategy, (x) the ability of PublicSquare to enforce its current or future intellectual property, including patents and trademarks, along with potential claims of infringement by PublicSquare of the intellectual property rights of others, (xi) actual or potential loss of key influencers, media outlets and promoters of PublicSquare’s business or a loss of reputation of PublicSquare or reduced interest in the mission and values of PublicSquare and the segment of the consumer marketplace it intends to serve, and (xii) the risk of economic downturn, increased competition, a changing regulatory landscape and related impacts that could occur in the highly competitive consumer marketplace, both online and through “bricks and mortar” operations. The foregoing list of factors is not exhaustive. Recipients should carefully consider such factors and the other risks and uncertainties described and to be described in PublicSquare’s public filings with the Securities and Exchange Commission. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Recipients are cautioned not to put undue reliance on forward-looking statements, and PublicSquare does not assume any obligation to, nor does it intend to, update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law. PublicSquare gives no assurance that PublicSquare will achieve its expectations.

 

Investors Contact:

 

William I. Kent, IRC

+1 561.203.0780

investment@publicsquare.com

 

Media Contact:

 

pr@publicsquare.com

 

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PSQ HOLDINGS, INC. (dba PublicSquare)

Consolidated Balance Sheets

 

   December 31, 
   2023   2022 
Assets        
Current assets        
Cash and cash equivalents  $16,446,030   $2,330,405 
Accounts receivable, net   204,879    - 
Inventory   1,439,182    - 
Prepaid expenses and other current assets   3,084,576    289,379 
Total current assets   21,174,667    2,619,784 
Property and equipment, net   127,139    26,723 
Intangible assets, net   3,557,029    1,267,673 
Operating lease right-of-use assets   324,238    293,520 
Deposits   63,546    7,963 
Total assets  $25,246,619   $4,215,663 
           
Liabilities and stockholders’ equity          
Current liabilities          
Accounts payable  $1,828,508   $424,065 
Accrued expenses   1,641,553    41,494 
Deferred revenue   225,148    49,654 
Operating lease liabilities, current portion   310,911    169,275 
Total current liabilities   4,006,120    684,488 
Earn-out liabilities   660,000    - 
Warrant liabilities   10,130,000    - 
Operating lease liabilities   16,457    129,762 
Total liabilities   14,812,577    814,250 
Commitments and contingencies          
Stockholders’ equity          
Preferred stock, $0.0001 par value; 50,000,000 authorized shares; no shares issued and outstanding as of December 31, 2023 and December 31, 2022   -    - 
Class A Common stock, $0.0001 par value; 500,000,000 authorized shares; 24,410,075 shares and 11,806,007 shares issued and outstanding as of December 31, 2023 and December 31, 2022, respectively   2,441    1,181 
Class C Common stock, $0.0001 par value; 40,000,000 authorized shares; 3,213,678 shares issued and outstanding as of December 31, 2023 and December 31, 2022   321    321 
Additional paid in capital   72,644,419    12,383,475 
Subscription receivable   -    (99,612)
Accumulated deficit   (62,213,139)   (8,883,952)
Total stockholders’ equity   10,434,042    3,401,413 
Total liabilities and stockholders’ equity  $25,246,619   $4,215,663 

 

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PSQ HOLDINGS, INC. (dba PublicSquare)

Consolidated Statements of Operations

 

   Year ended December 31, 
   2023   2022 
         
Net services sales - Marketplace  $2,987,406   $475,175 
Net product sales - Brands   2,698,581    - 
Total net revenues   5,685,987    475,175 
Costs and expenses:          
Cost of sales - services (exclusive of depreciation and amortization expense shown below)   1,829,066    716,102 
Cost of goods sold (exclusive of depreciation and amortization expense shown below)   1,969,147    - 
General and administrative   15,222,451    2,016,638 
Sales and marketing   12,096,211    2,550,418 
Transaction costs incurred in connection with the Business Combination   6,845,777    - 
Research and development   4,626,625    1,446,347 
Depreciation and amortization   2,442,706    842,195 
Total operating expenses   45,031,983    7,571,700 
Operating loss   (39,345,996)   (7,096,525)
Other income (expense):          
Other income, net   340,807    118,158 
Change in fair value of convertible promissory notes   (14,571,109)   - 
Change in fair value of earn-out liabilities   1,740,000    - 
Change in fair value of warrant liabilities   (1,313,500)   - 
Interest (expense) income   (177,444)   591 
Loss before income taxes   (53,327,242)   (6,977,776)
Income tax expense   1,945    800 
Net loss  $(53,329,187)  $(6,978,576)
           
Net loss per common share, basic and diluted  $(2.43)  $(0.61)
Weighted average shares outstanding, basic and diluted   21,964,451    11,496,653 

 

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PSQ HOLDINGS, INC. (dba PublicSquare)

Consolidated Statements of Cash Flows

 

   For the years ended
December 31,
 
   2023   2022 
Cash Flows from Operating Activities        
Net loss  $(53,329,187)  $(6,978,576)
Adjustment to reconcile net loss to cash used in operating activities          
Depreciation and amortization   2,442,706    842,195 
Share-based compensation   6,706,419    - 
Realized gain on short term investment   (173,644)   - 
Change in fair value of convertible notes   14,571,109    - 
Change in fair value of warrant liabilities   1,313,500    - 
Change in fair value of earn out  liabilities   (1,740,000)   - 
Amortization of right-of-use assets   216,138    52,836 
Interest expense   58,706    - 
Changes in operating assets and liabilities:          
Accounts receivable   (204,879)   - 
Inventory   (1,439,182)   - 
Prepaid expenses and other current assets   (224,278)   (257,226)
Deposits   (55,583)   (5,463)
Accounts payable   2,711,585    280,730 
Accrued expenses   3,425,542    29,020 
Deferred revenue   175,494    49,654 
Operating lease liabilities   (218,524)   (47,319)
Net cash used in operating activities   (25,764,078)   (6,034,149)
           
Cash flows from Investing Activities          
Software development costs   (3,150,925)   (1,509,404)
Purchases of short-term investments   (10,049,870)   - 
Proceeds from the sale of short-term investments   10,223,514    - 
Purchase of intangible assets and trademarks   (233,881)   (15,000)
Purchases of property and equipment   (113,065)   (29,930)
Net cash used in investing activities   (3,324,227)   (1,554,334)
           
Cash flows from Financing Activities          
Proceeds from convertible note payable   22,500,000    - 
Net proceeds from reverse recapitalization   18,104,194    - 
Repayment of subscription payable   (400)   - 
Issuances of common stock   2,600,136    9,519,485 
Net cash provided by financing activities   43,203,930    9,519,485 
Net increase in cash and cash equivalents   14,115,625    1,931,002 
Cash and cash equivalents, beginning of period   2,330,405    399,403 
Cash and cash equivalents, end of the period  $16,446,030   $2,330,405 
           
Supplemental Cash Flow Information          
Recording of right of use asset and lease liability  $246,856   $346,356 
Subscription receivable  $-   $100,012 
Promissory notes, inclusive of accrued interest converted to equity  $37,294,022   $- 
Initial recognition of Earn-out liability  $2,400,000   $- 
Acquisition of warrant liability  $8,816,500   $- 
Prepaid expenses assumed in connection with business combination  $2,570,919   $- 
Liabilities paid through the trust  $1,778,672   $- 
Liabilities assumed in connection with business combination  $92,929   $- 
Stock for stock transfer  $1,334,858   $- 
Cash paid for interest  $-   $- 

 

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Segments

 

As of December 31, 2023, the Company’s operating and reportable segments include:

 

Marketplace: PSQ has created a marketplace platform to access consumers that are drawn to patriotic values. The Company generates revenue from advertising and eCommerce transactions.

 

Brands: The first wholly-owned brand is EveryLife, Inc., which generates revenue from online sales of diapers and wipes.

 

Adjusted EBITDA is defined as earnings (loss) from operations less depreciation and amortization, share based compensation and transaction costs. Earnings (loss) from operations excludes interest, interest expense, gain (loss) on sale of equipment, change in fair value of financial instruments and other expenses. The Company believes that Adjusted EBITDA is an appropriate measure for evaluating the operating performance of the Company’s business segments because it is the primary measure used by the Company’s chief operating decision maker to evaluate the performance of and allocate resources to the Company’s businesses.

 

Segment performance, as defined by the Company, is not necessarily comparable to other similarly titled captions of other companies.

 

The following tables set forth the Company’s revenues, net and adjusted EBITDA for the year ended December 31, 2023 and 2022:

 

   For the years ended
December 31,
 
   2023   2022 
Revenues, net:        
Marketplace        
Advertising and eCommerce sales  $2,987,406   $475,175 
Brands          
Product sales   3,185,931    - 
Returns and discounts   (487,350)   - 
Total Brand revenues, net   2,698,581    - 
Total revenues, net  $5,685,987   $475,175 

 

   For the years ended 
   December 31, 
   2023   2022 
         
Adjusted EBITDA  $(23,508,702)  $(6,254,330)
Transaction costs incurred in connection with the Business Combination   (6,845,777)   - 
Transaction costs incurred in connection with potential acquisitions   (550,792)   - 
Share-based compensation (exclusive of what is included in transaction costs above)   (5,998,019)   - 
Depreciation and amortization   (2,442,706)   (842,195)
Other income, net   340,807    118,158 
Change in fair value of warrant liabilities   (1,313,500)   - 
Change in fair value of earnout liabilities   1,740,000    - 
Change in fair value of convertible notes   (14,571,109)   - 
Income tax expense   (1,945)   (800)
Interest expense, net   (177,444)   591 
Net loss  $(53,329,187)  $(6,978,576)

  

 

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