Charge Enterprises Reports Fourth Quarter and Full Year 2022 Financial Results

  • Reported Revenues increased 41% for the quarter and 46% for the full year, compared with the prior year periods
  • Reported Gross Profit more than doubled from a year ago
  • Positioned to further expand best-in-class service for long-term growth

NEW YORK, NY / ACCESSWIRE / March 15, 2023 / Charge Enterprises, Inc. (NASDAQ:CRGE) ("Charge" or the "Company"), today reported fourth quarter and full year 2022 results. For the quarter, revenues were $168.0 million, compared with $119.3 million in the fourth quarter of 2021. For the full year, revenues were $697.8 million, compared with $477.0 million in the prior year period. Gross profit for the fourth quarter of 2022 increased to $8.5 million, compared with $3.9 million in the fourth quarter of 2021. For the full year, gross profit increased to $28.2 million, compared with $11.5 million in the prior year period.

"Charge's 2022 revenue of $697.8 million and gross profit of $28.2 million, allowed us to further expand our Electric Vehicle ("EV") charging infrastructure business and other key strategic initiatives," said Andrew Fox, Founder, Chairman and CEO. "We continue to execute on strategic initiatives with the goal of leveraging the talent of our business leaders to deliver operational excellence, seamless solutions for our clients, and consistent profitable growth for our stakeholders. Charge is positioned to capitalize on the next generation of the energy transition. Our initiatives within EV charging infrastructure and broadband continue to grow, and our white-glove, seamless solutions are designed to support and further enable the transition within these rapidly growing industry segments."

"Our EV charging infrastructure business, Charge Infrastructure ("CI"), which offers customized end-to-end services for EV charging ecosystems, is continually expanding its relationships with automotive dealerships, growing organically through current client referrals and working with multiple franchise operators across automotive OEM brands. We believe CI is well positioned to continue the Company's growth into 2023 and beyond and is currently servicing retail dealership locations across the nation representing more than 20 automotive OEM brands."

Mr. Fox concluded, "Everyone at Charge has a commitment to excellence, from our dedicated customer relationship teams, client service and retention, to the safety of our employees. We are dedicated to enhancing our strategic approach, focused on driving long-term value for both our clients and our shareholders. We expect 2023 to be a pivotal year as we execute our strategy to expand within the auto vertical, creating a business model with a seamless end-to-end solution to support the transition to EVs, and guiding clients to meet timing and infrastructure requirements while establishing a scalable plan for the future. At Charge, we make it simple to go electric. Our long term, scalable relationships are expected to support our growth strategy as we innovate infrastructure services and enable software solutions for our clients and their customers."

Selected Financial Information


As Reported
Three months ended December 31,
As Reported
Years ended December 31,



Increase

Increase
($ in thousands)
2022 2021 (Decrease) 2022 2021 (Decrease)
Total Revenues
$ 167,957 $ 119,309 $ 48,648 $ 697,833 $ 477,018 $ 220,815
Gross Profit
8,467 3,886 4,581 28,213 11,515 16,698
Net Income / (Loss)
(11,941) (14,774) 2,833 (30,349) (51,668) 21,319
Adjusted EBITDA(1)
$ (1,007) $ (2,962) $ 1,955 $ (6,136) $ (7,132) $ 996

Proforma
Three months ended December 31,
Proforma
Years ended December 31,

Increase Increase
($ in thousands)
2022 2021 (Decrease) 2022 2021 (Decrease)
Total Revenues
$ 167,957 $ 128,062 $ 39,895 $ 698,065 $ 520,913 $ 177,152
Gross Profit
8,467 6,428 2,039 28,357 22,421 5,936
Net Income / (Loss)
(11,941) (13,921) 1,980 (30,275) (47,016) 16,741
Adjusted EBITDA(1)
$ (1,007) $ (1,809) $ 802 $ (6,053) $ (4,007) $ (2,046)
  1. Adjusted EBITDA represents income (loss) before interest, income taxes, depreciation and amortization, and amortization of debt discount and debt issue costs adjusted for stock-based compensation, loss on impairment, (income) loss from investments, net, change in fair value of derivative liabilities, other (income) expense, net, and foreign exchange adjustments. Refer to Appendix for definition and complete non-GAAP reconciliation for Adjusted EBITDA.

Charge's CFO Leah Schweller commented, "Fourth quarter 2022 represented another solid performance for Charge and a strong end to the year, with our Advanced Network Services ("ANS") and BW Electrical Services ("BW") subsidiaries delivering their highest yearly revenues on record. These results are a validation of our business strategy and our teams' successes in capturing growth and optimizing our day-to-day operations. Moreover, our management team has shown the resilience to succeed in a dynamic environment. Our current Infrastructure segment backlog at $82 million remains strong. With the strength of our backlog and tailwinds supporting growth in the EV charging infrastructure space, we are well-positioned for the future. Additionally, during the quarter, we continued to prudently deploy our capital, always with an eye toward bolstering growth."

Reported financial results include operations from the date of acquisition: ANS acquired on May 21, 2021; BW acquired on December 27, 2021; and EV Group Holdings ("EV Depot") acquired on January 14, 2022. Due to the timing of certain acquisitions, current quarter results are not necessarily comparable to the prior periods.

Proforma financial results include: the full three- and twelve-months periods for all of the Company's operations, including 2021 and 2022 acquisitions, as if they happened on the first day of the respective period. Management believes that presenting proforma results is important to understanding the Company's financial performance and provides better analysis of trends in the Company's underlying businesses as it allows for comparability to prior period results.

Fourth Quarter 2022 Financial Results

Reported revenues for the fourth quarter of 2022 increased $48.6 million to $168.0 million, and proforma revenues increased $39.9 million to $168.0 million, compared with the fourth quarter of 2021. The increase in reported and proforma revenues was driven by higher revenues in both of the Company's business segments.

  • Infrastructure: Reported revenues increased $23.0 million to $33.7 million, and proforma revenues increased $14.2 million to $33.7 million, compared with the fourth quarter of 2021. The increase in reported revenues was due to the Company's acquisitions of BW and EV Depot and organic growth in its ANS and CI businesses.
  • Telecommunications: Reported and proforma revenues increased $25.7 million to $134.2 million, compared with the fourth quarter of 2021. The increase was driven by higher voice call volume.

Reported gross profit for the fourth quarter of 2022 increased $4.6 million to $8.5 million, and proforma gross profit increased $2.0 million to $8.5 million, compared with the fourth quarter of 2021. The increase in reported and proforma gross profit was primarily driven by higher revenues, partially offset by lower gross profit in the Company's Telecommunications segment due to customer mix. Reported gross margin percentage for the fourth quarter of 2022 increased, compared with the fourth quarter of 2021, due to an increase in revenue from its higher-margin Infrastructure segment, partially offset by a decline in gross margin in the Telecommunications segment. Proforma gross margin percentage was in line with the prior year fourth quarter.

Reported net loss for the fourth quarter of 2022 was $11.9 million, compared with a net loss of $ 14.8 million in the fourth quarter of 2021. Proforma net loss was $11.9 million, compared with a net loss of $13.9 million in the fourth quarter of 2021. On a reported basis, incremental expenses after gross margin were primarily related to continued investments the Company made during the quarter to support its growth strategy. The largest drivers over the fourth quarter of 2021 were:

  • $7.1 million in stock-based compensation expense, which represented a decrease of $2.2 million, primarily due to lower stock option grants compared with 2021;
  • $4.0 million in general and administrative expense, which represented a $1.3 million increase, due to costs related to growing the business;
  • $4.8 million in salaries and related benefits, which represented a $1.2 million increase, driven by incremental headcount to support the growth of the Company;
  • $4.6 million in amortization expense, which represented a $4.4 million increase, driven by the establishment of intangible assets associated with the acquisitions of ANS, BW and EV Depot; and
  • $2.8 million in other (income) expense, net, which represented a $4.6 million increase in income. Included in the increase was a gain related to a derivative liability, partially offset by a write-off for donated equipment to an organization that addresses the needs on the ground immediately following natural disasters.

The reported net loss of $11.9 million in the fourth quarter of 2022, adjusted for non-cash and certain one-time items, resulted in an Adjusted EBITDA loss of $1.0 million, compared with Adjusted EBITDA loss of $3.0 million in the fourth quarter of 2021. The proforma net loss of $11.9 million in the fourth quarter of 2022, adjusted for non-cash and certain one-time items, resulted in an Adjusted EBITDA loss of $1.0 million, compared with Adjusted EBITDA loss of $1.8 million in the fourth quarter of 2021. See the Appendix for definition and a full reconciliation.

Full Year 2022 Financial Results

For the full year 2022, reported revenues increased $220.8 million to $697.8 million, and proforma revenues increased $177.2 million to $698.1 million, compared with the prior year period.

  • Infrastructure: Reported revenues increased $81.3 million to $105.5 million, and proforma revenues increased $37.6 million to $105.8 million, compared with the prior year period.
  • Telecommunications: Reported and proforma revenues increased $139.5 million to $592.3 million, compared with the prior year period.

Reported gross profit for the full year of 2022 increased $16.7 million to $28.2 million, and proforma gross profit increased $5.9 million to $28.4 million, compared with the prior year period.

Reported net loss for the full year of 2022 was $30.3 million, compared with a net loss of $51.7 million in the prior year period. Proforma net loss was $30.3 million, compared with a net loss of $47.0 million in the prior year period.

The reported net loss of $30.3 million for the full year of 2022, adjusted for non-cash and certain one-time items, resulted in an Adjusted EBITDA loss of $6.1 million, compared with an Adjusted EBITDA loss of $7.1 million in the prior year period. The proforma net loss of $30.3 million for the full year of 2022, adjusted for non-cash and certain one-time items, resulted in an Adjusted EBITDA loss of $6.1 million, compared with Adjusted EBITDA loss of $4.0 million in the prior year period. See the Appendix for definition and a full reconciliation.

As of December 31, 2022, Charge held $33.6 million in cash, cash equivalents and marketable securities.

For further details of the Company's financials, please see Charge Enterprises' Annual Report on Form 10-K for the year ended December 31, 2022, filed with the Securities and Exchange Commission on March 15, 2023 and available on Charge's website Charge | SEC Filings. Financial statements prior to December 31, 2021, were filed with the OTC Markets.

Webcast Data

Charge Enterprises, Inc. will host a webcast at 10:30 a.m. Eastern Time today to discuss the fourth quarter and full year 2022 financial results. The webcast can be accessed on the Company's website on the Investor Relations page at Charge Enterprises, Inc.

About Charge Enterprises, Inc.

Charge Enterprises, Inc. is an electrical, broadband and EV charging infrastructure company that provides clients with end-to-end project management services. We operate in two segments: Infrastructure, which has a primary focus on EV charging, broadband and wireless, and electrical contracting services; and Telecommunications, which provides connection of voice calls and data to global carriers. Our vision is to be a leader in enabling the next wave of transportation and connectivity. By building, designing, and operating seamless infrastructure for electric vehicles, we aim to create a future where transportation is clean, efficient, and connected and to empower individuals, communities, and businesses to thrive in a more sustainable world. Our plan is to cultivate repeat customers and recurring revenue by deploying a multi-phased strategy, initially where investment in the EV charging revolution is taking place, the nation's approximately 18,000 franchised auto dealers.

To learn more about Charge, visit Charge Enterprises, Inc.

Notice Regarding Forward-Looking Information

This press release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect current expectations or beliefs regarding future events or Charge's future performance. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "continues", "forecasts", "projects", "predicts", "intends", "anticipates", "targets" or "believes", or variations of, or the negatives of, such words and phrases or state that certain actions, events or results "may", "could", "would", "should", "might" or "will" be taken, occur or be achieved. All forward-looking statements, including those herein, are qualified by this cautionary statement. Although Charge believes that the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements involve risks and uncertainties, and actual results may differ materially from any future results expressed or implied by such forward-looking statements. Such risks and uncertainties include the business plans and strategies of Charge, Charge's future business development, market acceptance of electric vehicles, Charge's ability to generate profits and positive cash flow, changes in government regulations and government incentives, subsidies, or other favorable government policies, rising interest rates and the impact on investments by our customers, and other risks discussed in Charge's filings with the U.S. Securities and Exchange Commission ("SEC"). Readers are cautioned that the foregoing list of risks and uncertainties is not exhaustive of the factors that may affect forward-looking statements. Accordingly, readers should not place undue reliance on forward-looking statements. The forward-looking statements in this press release speak only as of the date of this press release or as of the date or dates specified in such statements. For more information on us, investors are encouraged to review our public filings with the SEC, including the factors described in the section captioned "Risk Factors" of Charge's Annual Report on Form 10-K to be filed with the SEC on March 15, 2023, as well as subsequent reports we file from time to time with the SEC which are available on the SEC's website at www.sec.gov. Charge disclaims any intention or obligation to update or revise any forward- looking information, whether as a result of new information, future events or otherwise, other than as required by law.

Notice Regarding Non-GAAP Measures

The press release includes both financial measures in accordance with U.S. generally accepted accounting principles ("GAAP"), as well as non-GAAP financial measures. These non-GAAP financial measures are in addition to, and not a substitute for or superior to, measures of financial performance prepared in accordance with GAAP. See the Appendix for a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures. These non-GAAP financial measures may be different from non-GAAP financial measures used by other companies.

# # #

Contacts:

Investors

Christine Cannella (954) 298-6518
Ccannella@charge.enterprises

Carolyn Capaccio, CFA (212) 838-3777
Ccapaccio@lhai.com

APPENDIX

CHARGE ENTERPRISES, INC.
CONSOLIDATED RESULTS OF OPERATIONS


As Reported As Reported

Three Months Ended December 31, Years Ended December 31,



Increase % Increase

Increase % Increase
(in thousands)
2022 2021 (Decrease) (Decrease) 2022 2021 (Decrease) (Decrease)
Revenues:








Infrastructure
$ 33,719 $ 10,737 $ 22,982 214% $ 105,523 $ 24,251 $ 81,272 335%
Telecommunications
134,238 108,572 25,666 24% 592,310 452,767 139,543 31%
Total revenues
167,957 119,309 48,648 41% 697,833 477,018 220,815 46%
Cost of goods sold
159,490 115,423 44,067 38% 669,620 465,503 204,117 44%
Gross profit
8,467 3,886 4,581 118% 28,213 11,515 16,698 145%
Stock-based compensation
7,097 9,272 (2,175) (23%) 35,449 30,623 4,826 16%
General and administrative
3,972 2,670 1,302 49% 14,392 7,995 6,397 80%
Salaries and related benefits
4,792 3,596 1,196 33% 16,667 8,806 7,861 89%
Professional fees
710 582 128 22% 3,290 1,846 1,444 78%
Depreciation and amortization expense
4,632 215 4,417 2054% 6,377 529 5,848 1105%
Income (loss) from operations
(12,736) (12,449) (287) (2%) (47,962) (38,284) (9,678) (25%)
Other (income) expenses
(2,843) 1,709 (4,552) (266%) (17,888) 18,676 (36,564) (196%)
Income tax expense (benefit)
2,048 616 1,432 232% 275 (5,292) 5,567 105%
Net income (loss)
$ (11,941) $ (14,774) $ 2,833 19% $ (30,349) $ (51,668) $ 21,319 41%


Proforma Proforma

Three Months Ended December 31, Years Ended December 31,



Increase % Increase

Increase % Increase
(in thousands)
2022 2021 (Decrease) (Decrease) 2022 2021 (Decrease) (Decrease)
Revenues:








Infrastructure
$ 33,719 $ 19,490 $ 14,229 73% $ 105,755 $ 68,146 $ 37,609 55%
Telecommunications
134,238 108,572 25,666 24% 592,310 452,767 139,543 31%
Total revenues
167,957 128,062 39,895 31% 698,065 520,913 177,152 34%
Cost of goods sold
159,490 121,634 37,856 31% 669,708 498,492 171,216 34%
Gross profit
8,467 6,428 2,039 32% 28,357 22,421 5,936 26%
Stock-based compensation
7,097 9,272 (2,175 (23%) 35,449 30,623 4,826 16%
General and administrative
3,972 3,023 949 31% 14,440 10,123 4,317 43%
Salaries and related benefits
4,792 4,547 245 5% 16,680 14,171 2,509 18%
Professional fees
710 667 43 6% 3,290 2,134 1,156 54%
Depreciation and amortization expense
4,632 241 4,391 1822% 6,377 790 5,587 707%
Income (loss) from operations
(12,736) (11,322) (1,414) (12%) (47,879) (35,420) (12,459) (35%)
Other (income) expenses
(2,843) 1,729 (4,572) (264%) (17,879) 16,504 (34,383) (208%)
Income tax expense (benefit)
2,048 870 1,178 135% 275 (4,908) 5,183 106%
Net income (loss)
$ (11,941) $ (13,921) $ 1,980 14% $ (30,275) $ (47,016) $ 16,741 36%


CHARGE ENTERPRISES, INC.
SEGMENT RESULTS OF OPERATIONS

Infrastructure


As Reported As Reported

Three Months Ended December 31, Years Ended December 31,



Increase % Increase

Increase % Increase
(in thousands)
2022 2021 (Decrease) (Decrease) 2022 2021 (Decrease) (Decrease)
Revenues
$ 33,719 $ 10,737 $ 22,982 214% $ 105,523 $ 24,251 $ 81,272 335%
Cost of goods sold
26,057 8,168 17,889 219% 81,583 18,347 63,236 345%
Gross profit
7,662 2,569 5,093 198% 23,940 5,904 18,036 305%
General and administrative
1,705 1,087 618 57% 5,349 2,681 2,668 100%
Salaries and related benefits
2,722 844 1,878 223% 8,872 2,268 6,604 291%
Professional fees
104 (13) 117 900% 315 38 277 729%
Depreciation and amortization expense
4,590 166 4,424 2665% 6,207 331 5,876 1775%
Income (loss) from operations
(1,459) 485 (1,944) (401%) 3,197 586 2,611 446%
Other (income) expenses
881 16 865 5406% 1,787 18,119 (16,332) (90%)
Income tax expense (benefit)
(3,823) 194 (4,017) (2071%) (3,837) 127 (3,964) (3121%)
Net income (loss)
$ 1,483 $ 275 $ 1,208 439% $ 5,247 $ (17,660) $ 22,907 130%


Proforma Proforma

Three Months Ended December 31, Years Ended December 31,



Increase % Increase

Increase % Increase
(in thousands)
2022 2021 (Decrease) (Decrease) 2022 2021 (Decrease) (Decrease)
Revenues
$ 33,719 $ 19,490 $ 14,229 73% $ 105,755 $ 68,146 $ 37,609 55%
Cost of goods sold
26,057 14,379 11,678 81% 81,671 51,336 30,335 59%
Gross profit
7,662 5,111 2,551 50% 24,084 16,810 7,274 43%
General and administrative
1,705 1,440 265 18% 5,397 4,809 588 12%
Salaries and related benefits
2,722 1,795 927 52% 8,885 7,633 1,252 16%
Professional fees
104 72 32 44% 315 326 (11) (3%)
Depreciation and amortization expense
4,590 192 4,398 2291% 6,207 592 5,615 948%
Income (loss) from operations
(1,459) 1,612 (3,071) (191%) 3,280 3,450 (170) (5%)
Other (income) expenses
881 36 845 2347% 1,796 15,947 (14,151) (89%)
Income tax expense (benefit)
(3,823) 448 (4,271) (953%) (3,837) 511 (4,348) (851%)
Net income (loss)
$ 1,483 $ 1,128 $ 355 31% $ 5,321 $ (13,008) $ 18,329 141%

Telecommunications


As Reported As Reported

Three Months Ended December 31, Years Ended December 31,



Increase % Increase

Increase % Increase
(in thousands)
2022 2021 (Decrease) (Decrease) 2022 2021 (Decrease) (Decrease)
Revenues
$ 134,238 $ 108,572 $ 25,666 24% $ 592,310 $ 452,767 $ 139,543 31%
Cost of goods sold
133,433 107,255 26,178 24% 588,037 447,156 140,881 32%
Gross profit
805 1,317 (512) (39%) 4,273 5,611 (1,338) (24%)
General and administrative
513 563 (50) (9%) 1,990 1,884 106 6%
Salaries and related benefits
173 339 (166) (49%) 803 1,811 (1,008) (56%)
Professional fees
20 5 15 300% 83 39 44 113%
Depreciation and amortization expense
42 49 (7) (14%) 170 198 (28) (14%)
Income (loss) from operations
57 361 (304) (84%) 1,227 1,679 (452) (27%)
Other (income) expenses
(64) 191 (255) (134%) (132 (694 562 81%
Income tax expense (benefit)
(6) 334 (340) (102%) (3 (903 900 100%
Net income (loss)
$ 127 $ (164) $ 291 177% $ 1,362 $ 3,276 $ (1,914) (58%)

Non-Operating Corporate


As Reported As Reported

Three Months Ended December 31, Years Ended December 31,



Increase % Increase

Increase % Increase
(in thousands)
2022 2021 (Decrease) (Decrease) 2022 2021 (Decrease) (Decrease)
Revenues
$ - $ - $ -
$ - $ - $ -
Cost of goods sold
- - -
- - -
Gross profit
- - -
- - -
Stock-based compensation
7,097 9,272 (2,175) (23%) 35,449 30,623 4,826 16%
General and administrative
1,754 1,020 734 72% 7,053 3,430 3,623 106%
Salaries and related benefits
1,897 2,413 (516) (21%) 6,992 4,727 2,265 48%
Professional fees
586 590 (4) (1%) 2,892 1,769 1,123 63%
Income (loss) from operations
(11,334) (13,295) 1,961 (0) (52,386) (40,549) (11,837) (29%)
Other (income) expenses
(3,660) 1,502 (5,162) (344%) (19,543) 1,251 (20,794) (1,662%)
Income tax expense (benefit)
5,877 88 5,789 6578% 4,115 (4,516) 8,631 191%
Net income (loss)
$ (13,551) $ (14,885) $ 1,334 9% $ (36,958) $ (37,284) $ 326 1%


CHARGE ENTERPRISES, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)


December 31, December 31,

2022 2021
ASSETS


Current assets


Cash and cash equivalents
$ 26,837 $ 18,238
Restricted cash
886 -
Accounts receivable net of allowances of $322 in 2022 and $268 in 2021, respectively
72,405 73,334
Inventory
111 111
Deposits, prepaids and other current assets
3,187 1,721
Investments in marketable securities
6,757 9,619
Investments in non-marketable securities
236 100
Cost in excess of billings
6,090 4,812
Total current assets
116,509 107,935
Property, plant and equipment, net
732 2,012
Finance lease right-of-use asset
341 470
Operating lease right-of-use asset
4,028 1,558
Non-current assets
240 -
Net deferred tax asset
- 5,580
Goodwill, net
12,672 26,055
Intangible assets, net
33,932 -
Total assets
168,454 143,610
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable
$ 61,644 $ 71,428
Accrued liabilities
11,121 5,740
Deferred revenue
13,741 7,018
Derivative liability
6,521 -
Finance lease liability
112 159
Operating lease liability
1,579 125
Current portion of long-term debt
29,180 4,598
Total current liabilities
123,898 89,068

Non-current liabilities
Finance lease liability, non-current
146 219
Operating lease liability, non-current
2,199 1,443
Net deferred tax liability
1,389 -
Long-term debt, net of current portion
- 30,563
Total liabilities
127,632 121,293

Mezzanine Equity
Series B Preferred Stock (0 and 2,395,105 shares issued and outstanding at December 31, 2022 and December 31, 2021, respectively)
- 6,850
Series C Preferred Stock (6,226,370 shares issued and outstanding at December 31, 2022)
16,572 -
Total Mezzanine Equity
16,572 6,850

Commitments, contingencies and concentration risk

Stockholders' Equity
Preferred stock, $0.0001 par value, 20,000,000 shares authorized;
Series C:2,370,370 shares issued and outstanding at December 31, 2021
- -
Series D: 1,177,023 shares issued and outstanding at December 31, 2022
- -
Common stock, $0.0001 par value; 750,000,000 shares authorized 206,844,580 and 184,266,934 issued and outstanding at December 31, 2022 and December 31, 2021, respectively
20 18
Common stock to be issued, 0 shares at December 31, 2022 and 6,587,897 December 31, 2021
- 1
Additional paid in capital
197,816 126,870
Accumulated other comprehensive income (loss)
- (32)
Accumulated deficit
(173,586) (111,390)
Total stockholders' equity
24,250 15,467
Total liabilities and stockholders' equity
$ 168,454 $ 143,610


CHARGE ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)




Years Ended December 31,

2022 2021
Revenues
$ 697,833 $ 477,018
Cost of Goods Sold
669,620 465,503
Gross Profit
28,213 11,515

Operating expenses
Stock-based compensation
35,449 30,623
General and administrative
14,392 7,995
Salaries and related benefits
16,667 8,806
Professional fees
3,290 1,846
Depreciation and amortization expense
6,377 529
Total operating expenses
76,175 49,799

(Loss) from operations
(47,962) (38,284)

Other income (expenses):
Loss on impairment
(797) (18,116)
Income (loss) from investments, net
(789) 3,330
Change in fair value of derivative liabilities
33,921 -
Interest expense
(11,905) (4,619)
Other income (expense), net
(2,482) 1,063
Foreign exchange adjustments
(60) (334)
Total other income (expenses), net
17,888 (18,676)

Income (loss) before income taxes
(30,074) (56,960)

Income tax benefit (expense)
(275) 5,292

Net (loss)
$ (30,349) $ (51,668)
Less: Deemed dividend
(36,697) (7,407)
Less: Preferred dividends
(1,349) -
Net (loss) available to common stockholders
$ (68,395) $ (59,075)

Basic income (loss) per share available to common stockholders
$ (0.35) $ (0.38)
Diluted income (loss) per share available to common stockholders
$ (0.35) $ (0.38)

Weighted average number of shares outstanding, basic
197,712 156,365
Weighted average number of shares outstanding, diluted
197,712 156,365


CHARGE ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

Years Ended December 31,

2022 2021
CASH FLOWS FROM OPERATING ACTIVITIES:


Net loss
$ (30,349) $ (51,668)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization
5,483 -
Depreciation
894 529
Stock-based compensation
35,449 30,623
Stock issued for services
- 354
Change in fair value of derivative liabilities
(33,921) -
Amortization of debt discount
9,346 3,056
Amortization of debt discount, related party
- 95
Amortization of debt issue costs
- 10
Loss on foreign currency exchange
60 363
Loss on impairment
797 18,116
Net loss (gain) from investments
789 (3,330)
Other expense, net
2,482 (1,126)
Change in deferred income taxes
(690) (5,292)
Changes in working capital requirements:
Accounts receivable
773 4,345
Deposits, prepaids and other current assets
(916) 1,478
Other assets
(47) 183
Costs in excess of billings
(1,278) (2,222)
Accounts payable
(9,411) (4,198)
Other current liabilities
2,445 1,123
Deferred revenue
6,724 4,746
Other comprehensive income
- (93)
Net cash (used in) operating activities
(11,370) (2,908)

CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of fixed assets
(239) (1,355)
Disposal of fixed assets
- 910
Sale of intellectual property
179 -
Purchase of marketable securities
(55,983) (67,440)
Sale of marketable securities
57,980 66,681
Purchase of non-marketable securities
- (100)
Acquisition of ANS
(363) (12,948)
Acquisition of EV Depot
(1,231) -
Acquisition of BW
(2,459) (13,500)
Cash acquired in acquisitions
104 2,785
Net cash provided by (used in) investing activities
(2,012) (24,967)

CASH FLOWS FROM FINANCING ACTIVITIES:
Cash receipts from issuance of notes payable
- 23,333
Cash receipts from issuance of convertible notes payable
- 5,000
Proceeds from sale of common stock
10,000 -
Proceeds from sale of Series C preferred stock
10,845 6,667
Proceeds from exercise of warrants
1,122 -
Proceeds from exercise of stock options
363 -
Draws from revolving line of credit, net
3,126 113
Employee taxes paid for stock-based compensation
(434) -
Cash paid for contingent liability
- (61)
Payment on financing lease
(167) (133)
Payment of dividends
(1,177) -
Redemption of Series B preferred stock
(685) -
Net cash provided by financing activities
22,993 34,919

Foreign currency adjustment
(126) (435)

NET INCREASE IN CASH AND CASH EQUIVALENTS
9,485 6,609
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
18,238 11,629
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD
$ 27,723 $ 18,238

Supplemental disclosure of cash flow information
Cash paid for interest expense
$ 2,695 $ 965
Cash paid for income taxes
$ 786 $ -

Non-cash investing and financing activities:
Issuance of Series B Preferred Stock for acquisition
$ - $ 6,850
Issuance of common stock for acquisition
$ 17,530 $ -
Debt discount associated with promissory notes
$ - $ 7,717

Non-GAAP Measures

In this press release, the Company has supplemented the presentation of its financial results calculated in accordance with U.S. generally accepted accounting principles ("GAAP") with the following financial measures that are not calculated in accordance with GAAP: EBITDA and Adjusted EBITDA. Management uses both GAAP and non-GAAP measures to assist in making business decisions and assessing overall performance. The Company's measurement of these non-GAAP financial measures may be different from similarly titled financial measures used by others and therefore may not be comparable. These non-GAAP financial measures should not be considered superior to the GAAP measures in the tables included within this material.

Certain information presented in this press release reflects adjustments to GAAP measures such as EBITDA and Adjusted EBITDA as an additional way of assessing certain aspects of the Company's operations that, when viewed with the GAAP financial measures, provide a more complete understanding of its on-going business. EBITDA is defined as income (loss) before interest, income taxes, depreciation and amortization, and amortization of debt discount and debt issue costs. Adjusted EBITDA represents EBITDA adjusted for stock-based compensation, income (loss) from investments, net, other (income) expense, net, and foreign exchange adjustments.

CHARGE ENTERPRISES, INC.
NON-GAAP RECONCILIATION


As Reported
Three months ended December 31,
As Reported
Years ended December 31,
($ in thousands)
2022 2021 2022 2021
Adjusted EBITDA:




Net income (loss)
$ (11,941) $ (14,774) $ (30,349) $ (51,668)
Income tax expense (benefit)
2,048 616 275 (5,292)
Interest expense
1,965 1,431 11,905 4,619
Depreciation & Amortization
4,632 215 6,377 529
EBITDA
(3,296) (12,512) (11,792) (51,812)
Adjustments:
Stock based compensation
7,097 9,272 35,449 30,623
Loss on impairment
797 (4) 797 18,116
(Income) loss from investments, net
(351) 90 789 (3,330)
Change in fair value of derivative liabilities
(5,252) - (33,921) -
Other (income) expense, net
49 119 2,482 (1,063)
Foreign exchange adjustments
(51) 73 60 334
Adjusted EBITDA
$ (1,007) $ (2,962) $ (6,136) $ (7,132)


Proforma
Three months ended December 31,
Proforma
Years ended December 31,
($ in thousands)
2022 2021 2022 2021
Adjusted EBITDA:




Net income (loss)
$ (11,941) $ (13,921) $ (30,275) $ (47,016)
Income tax expense (benefit)
2,048 870 275 (4,908)
Interest expense
1,965 1,452 11,914 4,662
Depreciation & Amortization
4,632 241 6,377 790
EBITDA
(3,296) (11,358) (11,709) (46,472)
Adjustments:
Stock based compensation
7,097 9,272 35,449 30,623
Loss on impairment
797 (4) 797 18,116
(Income) loss from investments, net
(351) 90 789 (3,330)
Change in fair value of derivative liabilities
(5,252) - (33,921) -
Other (income) expense, net
49 118 2,482 (3,278)
Foreign exchange adjustments
(51) 73 60 334
Adjusted EBITDA
$ (1,007) $ (1,809) $ (6,053) $ (4,007)

SOURCE: Charge Enterprises Inc.



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https://www.accesswire.com/743768/Charge-Enterprises-Reports-Fourth-Quarter-and-Full-Year-2022-Financial-Results

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