Hour Loop, Inc. (NASDAQ: HOUR) (“Hour Loop”), a leading online
retailer, announces its financial and operational results for the
second quarter ended June 30, 2022.
Financial Highlights for Second Quarter
2022:
- Total revenues increased 27.1% and
19.8% to $14.8 million, compared to $11.6 million in the year-ago
period and $12.4 million for the first quarter of 2022,
respectively.
- Net loss totaled $0.31 million,
compared to net income of $1.1 million in the year-ago period and
net loss of $0.65 million for the first quarter of 2022.
- Cash used in operating activities
for the six months ended June 30, 2022 was $13.2 million, compared
to $0.2 million in the year-ago period.
Management Commentary
“We’re pleased with our second quarter 2022
performance as we reported strong financial and operational results
despite the significantly impacted consumer spending environment
driven by inflationary and supply chain pressures and the trending
down traffic in overall e-commerce,” said Sam Lai, CEO of Hour
Loop. “Against this backdrop, we further demonstrated our ability
to execute on our strategy and drive growth as planned. Given that
our investment in labor and inventories were frontloaded in the
first quarter, we have delivered second quarter 2022 revenues of
$14.8 million, up 27.1% and 19.8% compared to the year ago period
and first quarter of 2022, respectively, while our net loss
significantly narrowed.
“While we are encouraged by our progress, we are
not immune to the challenging macroeconomic environment, which
impacted our gross profit percentage as a result of increased
operating expenses, FBA fees, and a strong competitive environment.
However, despite these challenges, we are frontloading our
investments for the year while projecting to show profitability and
maintain double digit growth for the full year 2022. We believe our
investments are necessary to grow our headcount, rapidly scale, and
set a foundation for future success once these headwinds ease, and
we are building on our momentum since our IPO. We look forward to
continuing to execute, drive growth, and ultimately deliver
increased value for our shareholders.”
Second Quarter 2022 Financial
Results
Total revenues in the second quarter of 2022
were $14.8 million compared to $11.6 million in the year-ago period
and $12.3 million for the first quarter of 2022, respectively. The
increase was primarily due to continued growth and maturity in our
operating model, despite a continuation in overall e-commerce
traffic decline in the second quarter.
Gross profit percentage declined 1.92% to
56.46%, compared to 58.38% of total revenues in the comparable
period a year ago but improved from 52.3% for the first quarter of
2022. The year-over-year decrease was a function of our aggressive
growth initiatives and a heightened inflationary environment
causing higher cost of goods sold, increased FBA fees, and strong
competition.
Operating expenses increased 52.8% to $8.7
million compared to $5.7 million in the year- ago period. This was
a function of increased platform fees paid to Amazon, and a
significant increase in our labor force.
Net loss in the second quarter was $0.31
million, or $0.01 per diluted share, compared to net income of
$0.86 million, or $0.03 per diluted share, in the comparable
year-ago period. The decrease was driven by increased costs and
expenses as a result of the reasons mentioned above. Nevertheless,
net loss in the second quarter narrowed to around half of the net
loss for the first quarter of 2022.
As of June 30, 2022, the Company had $2.3
million in cash and cash equivalents, compared to $10.6 million as
of December 31, 2021. This decrease was driven by the growth of
inventory and labor force.
Inventories as of June 30, 2022, were $14.6
million compared to $7.0 million as of December 31, 2021. The
Company intentionally invested heavily in inventories for strategic
reasons.
Full Year 2022 Financial
Outlook
For the full year 2022, the Company maintains
its guidance for revenue to be in the range of $81 million to $90
million, representing 30% to 45% year-over-year growth.
About Hour Loop, Inc.Hour Loop
is an online retailer engaged in e-commerce retailing in the U.S.
market. It has operated as a third-party seller on www.amazon.com
and has sold merchandise on its website at www.hourloop.com since
2013. The Company expanded its operations to www.walmart.com in
October 2020. To date, the Company has generated practically all of
its revenue as a third-party seller on www.amazon.com and only a
negligible amount of revenue from its own website and Walmart. Hour
Loop manages more than 100,000 stock-keeping units (“SKUs”).
Product categories include home/garden décor, toys, kitchenware,
apparels, and electronics. The Company's primary strategy is to
bring most of its vendors product selections to the customers. It
has advanced software that assists the Company in identifying
product gaps so it can keep such products in stock year-round
including the entirety of the last quarter (holiday season) of the
calendar year. In upcoming years, Hour Loop plans to expand its
business rapidly by increasing the number of business managers,
vendors and SKUs.
Forward-Looking Statements This
press release contains statements that constitute "forward-looking
statements" including with respect to the Company's business
strategy, product development and industry trends. Forward-looking
statements are subject to numerous conditions, many of which are
beyond the control of the Company. While the Company believes these
forward-looking statements are reasonable, undue reliance should
not be placed on any such forward-looking statements, which are
based on information available to the Company on the date of this
release. These forward-looking statements are based upon current
estimates and assumptions and are subject to various risks and
uncertainties, including, without limitation, those set forth in
the Company's filings with the Securities and Exchange Commission,
as the same may be updated from time to time. Thus, actual results
could be materially different. The Company undertakes no obligation
to update these statements whether as a result of new information,
future events or otherwise, after the date of this release, except
as required by law.
Investor ContactFinance
Departmentfinance@hourloop.com
HOUR LOOP, INC.CONDENSED
CONSOLIDATED BALANCE SHEETSAs of June 30, 2022
(Unaudited) and December 31, 2021
|
|
June 30, |
|
December 31, |
|
|
2022 |
|
2021 |
|
|
(unaudited) |
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
2,306,430 |
|
|
$ |
10,592,572 |
|
Accounts receivable, net |
|
|
151,607 |
|
|
|
125,991 |
|
Inventory, net |
|
|
14,601,346 |
|
|
|
7,041,864 |
|
Prepaid expenses and other current assets |
|
|
831,839 |
|
|
|
965,298 |
|
Total current assets |
|
|
17,891,222 |
|
|
|
18,725,725 |
|
|
|
|
|
|
|
|
|
|
Property and equipment, net |
|
|
156,335 |
|
|
|
15,667 |
|
Deferred tax assets |
|
|
325,030 |
|
|
|
45,488 |
|
Right-of-use lease assets |
|
|
485,066 |
|
|
|
30,111 |
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS |
|
$ |
18,857,653 |
|
|
$ |
18,816,991 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’
EQUITY |
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
5,358,935 |
|
|
$ |
9,539,258 |
|
Accrued expenses and other current liabilities |
|
|
1,255,714 |
|
|
|
1,282,161 |
|
Due to related parties |
|
|
4,294,731 |
|
|
|
5,214,794 |
|
Income taxes payable |
|
|
126,333 |
|
|
|
126,333 |
|
Current operating lease liabilities |
|
|
303,923 |
|
|
|
- |
|
Total current liabilities |
|
|
11,339,636 |
|
|
|
16,162,546 |
|
|
|
|
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
|
|
|
|
Long-term operating lease liabilities |
|
|
184,704 |
|
|
|
- |
|
Total liabilities |
|
|
11,524,340 |
|
|
|
16,162,546 |
|
Commitments and
contingencies |
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity |
|
|
|
|
|
|
|
|
Preferred stock: $0.0001 par value, 10,000,000 shares authorized,
none issued and outstanding |
|
|
- |
|
|
|
- |
|
Common stock: $0.0001 par value, 300,000,000 shares authorized,
35,042,578 and 33,300,000 shares issued and outstanding |
|
|
3,504 |
|
|
|
3,330 |
|
Additional paid-in capital |
|
|
5,645,322 |
|
|
|
4,291 |
|
Retained earnings |
|
|
1,696,400 |
|
|
|
2,654,695 |
|
Accumulated other comprehensive loss |
|
|
(11,913 |
) |
|
|
(7,871 |
) |
Total stockholders’
equity |
|
|
7,333,313 |
|
|
|
2,654,445 |
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
$ |
18,857,653 |
|
|
$ |
18,816,991 |
|
|
|
|
|
|
|
|
|
|
HOUR LOOP, INC.CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSSFor the Periods Ended June 30, 2022 AND
2021 (Unaudited)
|
|
Three Months |
|
Three Months |
|
Six Months |
|
Six Months |
|
|
Ended |
|
Ended |
|
Ended |
|
Ended |
|
|
June 30, |
|
June 30, |
|
June 30, |
|
June 30, |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
|
|
|
|
|
|
|
Revenues, net |
|
$ |
14,800,518 |
|
|
$ |
11,643,230 |
|
|
$ |
27,154,501 |
|
|
$ |
20,966,143 |
|
Cost
of revenues |
|
|
(6,443,910 |
) |
|
|
(4,845,441 |
) |
|
|
(12,341,179 |
) |
|
|
(8,939,993 |
) |
|
|
|
|
|
|
|
|
|
Gross
profit |
|
|
8,356,608 |
|
|
|
6,797,789 |
|
|
|
14,813,322 |
|
|
|
12,026,150 |
|
|
|
|
|
|
|
|
|
|
Operating expenses |
|
|
|
|
|
|
|
|
Selling and marketing |
|
|
6,480,625 |
|
|
|
4,803,598 |
|
|
|
12,006,727 |
|
|
|
8,630,792 |
|
General and administrative |
|
|
2,275,642 |
|
|
|
925,698 |
|
|
|
3,951,606 |
|
|
|
1,462,507 |
|
Total
operating expenses |
|
|
8,756,267 |
|
|
|
5,729,296 |
|
|
|
15,958,333 |
|
|
|
10,093,299 |
|
|
|
|
|
|
|
|
|
|
(Loss) income from operations |
|
|
(399,659 |
) |
|
|
1,068,493 |
|
|
|
(1,145,011 |
) |
|
|
1,932,851 |
|
|
|
|
|
|
|
|
|
|
Other
(expenses) income |
|
|
|
|
|
|
|
|
Other expense |
|
|
(3,944 |
) |
|
|
(3,754 |
) |
|
|
(9,394 |
) |
|
|
(4,624 |
) |
Interest expense |
|
|
(20,567 |
) |
|
|
(10,328 |
) |
|
|
(104,125 |
) |
|
|
(10,328 |
) |
Other income |
|
|
13,754 |
|
|
|
52,098 |
|
|
|
20,693 |
|
|
|
54,504 |
|
Total
other (expenses) income, net |
|
|
(10,757 |
) |
|
|
38,016 |
|
|
|
(92,826 |
) |
|
|
39,552 |
|
|
|
|
|
|
|
|
|
|
(Loss) income before income taxes |
|
|
(410,416 |
) |
|
|
1,106,509 |
|
|
|
(1,237,837 |
) |
|
|
1,972,403 |
|
Provision for income taxes |
|
|
97,009 |
|
|
|
- |
|
|
|
279,542 |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
Net
(loss) income |
|
|
(313,407 |
) |
|
|
1,106,509 |
|
|
|
(958,295 |
) |
|
|
1,972,403 |
|
|
|
|
|
|
|
|
|
|
Other
comprehensive (loss) income |
|
|
|
|
|
|
|
|
Foreign currency translation adjustments |
|
|
(9,497 |
) |
|
|
2,893 |
|
|
|
(11,913 |
) |
|
|
1,671 |
|
|
|
|
|
|
|
|
|
|
TOTAL
COMPREHENSIVE (LOSS) INCOME |
|
$ |
(322,904 |
) |
|
$ |
1,109,402 |
|
|
$ |
(970,208 |
) |
|
$ |
1,974,074 |
|
|
|
|
|
|
|
|
|
|
Basic
and diluted (loss) income per common share |
|
$ |
(0.01 |
) |
|
$ |
0.03 |
|
|
$ |
(0.03 |
) |
|
$ |
0.06 |
|
Weighted-average number of common shares outstanding |
|
|
34,939,695 |
|
|
|
33,300,000 |
|
|
|
33,300,000 |
|
|
|
33,300,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HOUR LOOP, INC.CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWSFor the Six
Months Ended June 30, 2022 and
2021(Unaudited)
|
|
CommonStockShares |
|
CommonStockAmount |
|
AdditionalPaid-InCapital |
|
RetainedEarnings |
|
AccumulatedOtherComprehensive(Loss) Income |
|
TotalStockholders’Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BALANCE AT March 31, 2021 |
|
|
33,300,000 |
|
|
$ |
3,330 |
|
|
$ |
4,291 |
|
|
$ |
4,885,513 |
|
|
$ |
(4,403 |
) |
|
$ |
4,888,731 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contribution |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distribution |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,132,000 |
) |
|
|
|
|
|
|
(2,132,000 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency translation
adjustments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,671 |
|
|
|
1,671 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Income |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
1,106,509 |
|
|
|
- |
|
|
|
1,106,509 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BALANCE AT June 30,
2021 |
|
|
33,300,000 |
|
|
$ |
3,330 |
|
|
$ |
4,291 |
|
|
$ |
3,860,022 |
|
|
$ |
(2,732 |
) |
|
$ |
3,864,911 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BALANCE AT March 31,
2022 |
|
|
35,032,753 |
|
|
$ |
3,503 |
|
|
$ |
5,615,322 |
|
|
$ |
2,009,807 |
|
|
$ |
(10,287 |
) |
|
$ |
7,618,345 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock based
compensation |
|
|
9,825 |
|
|
|
1 |
|
|
|
30,000 |
|
|
|
|
|
|
|
|
|
|
|
30,001 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency translation
adjustments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,626 |
) |
|
|
(1,626 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(313,407 |
) |
|
|
- |
|
|
|
(313,407 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BALANCE AT June 30,
2022 |
|
|
35,042,578 |
|
|
$ |
3,504 |
|
|
$ |
5,645,322 |
|
|
$ |
1,696,400 |
|
|
$ |
(11,913 |
) |
|
$ |
7,333,313 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hour Loop (NASDAQ:HOUR)
Graphique Historique de l'Action
De Mai 2024 à Juin 2024
Hour Loop (NASDAQ:HOUR)
Graphique Historique de l'Action
De Juin 2023 à Juin 2024