Connexa Sports Technologies Inc. (Nasdaq:CNXA) reported operating
results for the quarter ended July 31, 2023 and provided an update
and review of operations, including compliance with four out of
five Nasdaq listing requirements and advised it expects to achieve
compliance with the one remaining deficiency by the current Nasdaq
required date of January 22, 2024.
The four continuing listing compliance
requirements recently met include:
- Filing of Form-10Q for 1Q FY24
(10/9/23)
- Filing of Form-10K for the FY 2023
(9/14/23)
- Minimum bid price, achieved by a
1:40 reverse stock split effective September 25, 2023.
- Appointment of two independent
directors, bringing the total number of directors to five. The new
directors are Rodney Rapson, CEO of an innovative wellness
management system for young athletes, and Steve Crummey, a seasoned
senior executive with management and board position experience in
several industries.
The one remaining listing compliance issue
outstanding, relates to the minimum capital requirement for a
Company to maintain a Nasdaq listing. The Company is in discussion
with several potential investors and currently expects to achieve
compliance before the current deadline of January 22, 2024.
For the first fiscal quarter, ended July 31,
2023, the Company reported revenue of $3.1 million compared to $3.6
million reported for the same period to July 31, 2022 and an
operating loss of $1.9 million, down approximately 40 percent from
the corresponding operating loss of $3.1 million reported in the
period last year.
“Our core business continues to be strong and
now, having divested several untimely and costly acquisitions, we
are preparing for a period of accelerated growth with new products
in sports markets in which we enjoy high brand recognition and a
growing base of loyal customers. Our expectation is to now be in a
position to drive an estimated 10% revenue growth for fiscal 2024
and to deliver operating profitability within the fourth quarter,”
said Mike Ballardie, CEO.
“We have a preeminent position in the racquet
sports market with over 70,000 of our Slinger Bag tennis ball
launchers sold worldwide over the past 36 months and with
approximately 45,000 of those being sold in the US alone,” he
continued. “Our shipping run-rate for Slinger Bag is currently
about 1,200 per month and as Tennis continues to grow in
participants – there are 87 million tennis players globally today
with the ITF leadership expecting to meet its objective of 120
million players1 by 2030 – Slinger Bag Tennis continues to have
significant opportunities for growth,” continued Ballardie.
The Company recently introduced its Slinger Bag
Pickleball Launcher to serve one of the fastest growing
racquetsports markets in the US, a market which currently boasts
more than five million regular players. The Company has also
introduced its Padel Tennis Launcher with the sport of Padel Tennis
enjoying similar levels of growing participant numbers across
Europe and South America.
In November, the Company expects to initiate
beta testing of its new GameFace AI product for tennis - an IOS and
Android downloadable app that records a practice session or
matchplay video, analyzes their play and provides specific
actionable feedback on how to improve.
Connexa’s team of AI engineers is also working
to replicate this for Pickleball and Padel Tennis for late Spring
2024 after which it will focus on development of a baseball version
to tie into the launch of Slinger Bag's innovative new Baseball
Launcher. Follow-on verticals are expected to include golf, soccer,
cricket, basketball, lacrosse and volleyball.
Each of these markets provides an opportunity
for continuing revenue growth based on monthly or yearly
subscriptions in the range of $15 and $100, respectively.
CONNEXA SPORTS TECHNOLOGIES,
INCCONSOLIDATED STATEMENTS OF OPERATIONS (IN US$)
(UNAUDITED)THREE MONTHS ENDED JULY 31, 2023 AND
2022
|
|
2023 |
|
|
2022 |
|
|
|
|
|
|
|
|
NET
SALES |
|
$ |
3,120,231 |
|
|
$ |
3,583,336 |
|
|
|
|
|
|
|
|
|
|
COST OF
SALES |
|
|
2,227,482 |
|
|
|
2,562,044 |
|
|
|
|
|
|
|
|
. |
|
GROSS
PROFIT |
|
|
892,749 |
|
|
|
1,021,292 |
|
|
|
|
|
|
|
|
|
|
OPERATING
EXPENSES |
|
|
|
|
|
|
|
|
Selling and marketing expenses |
|
|
242,353 |
|
|
|
756,823 |
|
General and administrative expenses |
|
|
2,505,060 |
|
|
|
3,314,610 |
|
Research and development costs |
|
|
- |
|
|
|
19,425 |
|
|
|
|
|
|
|
|
|
|
Total Operating Expenses |
|
|
2,747,413 |
|
|
|
4,090,858 |
|
|
|
|
|
|
|
|
|
|
OPERATING
LOSS |
|
|
(1,854,664 |
) |
|
|
(3,069,566 |
) |
Further information for shareholders can be
found in an open letter posted on our website
at https://www.connexasports.com/investor-relations/.
About Connexa Sports
Technologies:
Connexa Sports a leading connected sports
company delivering products, technologies, and Sport-as-a-Service
across a range of sport verticals. Connexa’s mission is to reinvent
sports through technological innovation driven by an unwavering
focus on today’s sports consumer.
Contact
Information:investors@connexasports.comwww.connexasports.com
Forward-Looking Statements
Forward-looking statements are subject to known
and unknown risks and uncertainties and are based on potentially
inaccurate assumptions that could cause actual results to differ
materially from those expected or implied by the forward-looking
statements.
Actual results could differ materially from
those anticipated in forward-looking statements for many reasons,
including the factors described in “Item 1A. Risk Factors” in our
10-K filing as of September 14, 2023 and our ability to
continue as a going concern. Accordingly, you should not rely on
these forward-looking statements, which speak only as of the date
of this press release. You should, however, review the factors and
risks we describe in the reports we will file from time to time
with the SEC after the date of this press release.
In addition, statements such as “we believe” and
similar statements reflect our beliefs and opinions on the relevant
subject. These statements are based on information available to us
as of the date of this press release. And while we believe that
information provides a reasonable basis for these statements, that
information may be limited or incomplete. Our statements should not
be read to indicate that we have conducted an exhaustive inquiry
into, or review of, all relevant information. These statements are
inherently uncertain, and you are cautioned not to rely unduly on
these statements.
Although we believe the expectations reflected
in the forward-looking statements were reasonable at the time made,
we cannot guarantee future results, level of activity, performance
or achievements. Moreover, neither we nor any other person assumes
responsibility for the accuracy or completeness of any of these
forward-looking statements. You should carefully consider the
cautionary statements contained or referred to in this section in
connection with the forward-looking statements contained in this
press release and any subsequent written or oral forward-looking
statements that may be issued by us or persons acting on our
behalf.
1 International Tennis Federation Global Report
(2021)2 https://www.usta.com/en/home/stay-current/national/u-s--tennis-participation-grew-for-third-straight-year-in-2022.html3 https://biz.crast.net/fmi-tennis-equipment-market-growing-at-a-cagr-of-2-9-in-the-forecast-period-2029/
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