KLNG Koil Energy Solutions Inc (QB)

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15 (d) of the

Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported)

November 4, 2024

 

KOIL ENERGY SOLUTIONS, INC.

(Exact name of registrant as specified in its charter)

 

 

Nevada		000-30351		75-2263732
(State or other jurisdiction of incorporation)		(Commission File Number)		(I.R.S. Employer Identification No.)

 

1310 Rankin Road, Houston, TX 77073

(Address of principal executive offices) (Zip Code)

 

(281) 517-5000

Registrant’s telephone number, including area code

 

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 4, 2024, Koil Energy Solutions, Inc. issued a press release announcing its financial results for the three and nine months ended September 30, 2024. 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 4, 2024
104	Cover Page Interactive Data File (formatted in Inline XBRL in Exhibit 101).

 

 

 

 

 

 

 

SIGNATURE

 

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 4, 2024

 

	KOIL ENERGY SOLUTIONS, INC.
	By:	/s/ Erik Wiik
		Erik Wiik
		President and Chief Executive Officer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 99.1

 

Koil Energy Solutions, Inc. Announces Third Quarter 2024 Results

 

Third Quarter Highlights

 

	·	Revenues of $5.2 million increased 27% year-over-year
	·	Gross profit of $2.1 million increased 50% year-over-year
	·	Net income of $523 thousand increased $666 thousand year-over-year
	·	Adjusted EBITDA of $675 thousand increased $658 thousand year-over-year

 

Houston, TX – November 4, 2024 – Koil Energy Solutions, Inc. (OTCQB: KLNG) (“KOIL”, or the “Company”), a specialist in deepwater production and distribution equipment and services, today reported results for the three and nine months ended September 30, 2024.

 

KOIL at a Glance:

 

Share Price†:	$1.75	Cash*:	$3.1M
52-Week Range†:	$0.42 - $1.98	Book Value*:	$7.9M
Shares Out.†:	12.2M	Price / Book Value:	2.7x
Market Cap†:	$21.3M	TTM Revenue:	$20.8M
*As of 09/30/24; †As of 11/01/24

 

“We delivered another quarter of robust performance, highlighted by year-over-year growth,” said Erik Wiik, President and CEO of KOIL. “Compared to the third quarter of last year, revenue grew 27%, gross margin increased to 40%, and adjusted EBITDA improved from a loss to a margin of 13%, all driven by our proactive growth strategy. These efforts have produced an earnings per share of $0.17, year-to-date.

 

“Our clients consistently provide positive feedback on our team’s performance, and we remain dedicated to maintaining this sentiment. I want to extend my heartfelt thanks to our employees, because we would not be able to achieve these results without their unwavering commitment to delivering exceptional quality while we continue to grow this remarkable company. Let me also offer my thanks to our shareholders, for their continued interest in the great investment opportunity that is KOIL Energy.”

 

Operating Results

 

KOIL’s revenues for the three months ended September 30, 2024 (“Q3 2024”) increased 27 percent to $5.2 million compared to $4.1 million for the three months ended September 30, 2023 (“Q3 2023”), primarily due to an increase in fixed price contracts for the manufacture of subsea distribution equipment.

 

Gross profit for Q3 2024 was $2.1 million, or 40 percent of revenues, compared to Q3 2023 gross profit of $1.4 million, or 33 percent of revenues. The comparative increase in Q3 2024 gross profit was primarily driven by increased revenues and improved project margins.

 

Selling, general and administrative expenses (“SG&A”) were $1.6 million, or 30 percent of revenues, in Q3 2024 and remained steady when compared to Q3 2023.

 

 

 

 

Due to the factors discussed above, KOIL reported Q3 2024 net income of $523 thousand, or $0.04 per diluted share, compared to a Q3 2023 net loss of $143 thousand, or a $0.01 loss per diluted share. Per share results for Q3 2024 and Q3 2023 are based on 12.41 million and 11.89 million weighted average shares outstanding, respectively.

 

KOIL reported adjusted EBITDA of $675 thousand in Q3 2024 compared to adjusted EBITDA of $17 thousand in Q3 2023. The comparative increase in adjusted EBITDA for Q3 2024 was primarily driven by growth in revenues and gross profit stemming from an increase in product-oriented, fixed-price projects in Q3 2024 as compared to Q3 2023.

 

Financial Position

 

At September 30, 2024, working capital totaled $4.9 million, which includes cash of $3.1 million and net receivables of $5.3 million. This is compared to $2.6 million of working capital at December 31, 2023, which includes cash of $2.0 million and receivables of $4.2 million. Shareholders’ equity totaled $7.9 million, or approximately $0.65 per common share, at September 30, 2024, compared to $5.6 million, or approximately $0.47 per common share, at the beginning of the year. The Company maintains access to a factoring arrangement with Amegy Bank Business Credit and at September 30, 2024, had no factored invoices outstanding with Amegy.

 

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/kzxfna26

 

The earnings release and a replay of the conference call will be available on the Company’s website, www.koilenergy.com, under the “Investors” section. An investor presentation will also be posted on our webpage following this press release.

 

About KOIL (www.koilenergy.com)

 

KOIL 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’s experienced team can support subsea engineering, manufacturing, installation, commissioning, and maintenance projects located anywhere in the world.

 

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

 

 

 

KOIL ENERGY SOLUTIONS, INC.

SUMMARY FINANCIAL DATA

(UNAUDITED)

 

Comparative Condensed Consolidated Income Statement

 

		Three Months Ended September 30,								Nine Months Ended September 30,
(In thousands, except per share amounts)		2024				2023				2024				2023
Revenues		$	5,223			$	4,107			$	16,793			$	11,338
Cost of sales			3,159				2,733				10,449				7,174
Selling, general and administrative			1,586				1,582				4,316				4,887
Operating income (loss)			478				(208	)			2,028				(723	)
Total other (income) expense			(47	)			(68	)			(62	)			(58	)
Income (loss) before income tax expense			525				(140	)			2,090				(665	)
Income tax expense			2				3				7				8
Net income (loss)		$	523			$	(143	)		$	2,083			$	(673	)
Net income (loss) per share, basic		$	0.04			$	(0.01	)		$	0.17			$	(0.06	)
Weighted-average shares outstanding, basic			12,199				11,888				12,235				11,888

 

Comparative Condensed Consolidated Balance Sheets

 

		September 30,				December 31,
(In thousands)		2024				2023
Assets:
Cash		$	3,120			$	2,030
Other current assets			6,720				5,819
PP&E, net			2,699				2,968
Other non-current assets			6,047				6,245
Total assets		$	18,586			$	17,062
Liabilities:
Current liabilities		$	4,945			$	5,284
Other long-term liabilities			5,751				6,160
Total liabilities			10,696				11,444
Stockholders' equity			7,890				5,618
Total liabilities and stockholders' equity		$	18,586			$	17,062

 

 

 

 

 

KOIL ENERGY SOLUTIONS, INC.

SUMMARY FINANCIAL DATA, CONTINUED

(UNAUDITED)

 

Adjusted EBITDA

 

		Three Months Ended September 30,								Nine Months Ended September 30,
(In thousands)		2024				2023				2024				2023
Net income (loss)		$	523			$	(143	)		$	2,083			$	(673	)
Deduct: Interest income, net			(17	)			(7	)			(30	)			(3	)
Add: Income tax expense			2				3				7				8
Add: Depreciation and amortization			144				155				437				461
Add: Share-based compensation			23				9				76				49
Add (Deduct): Loss (gain) on sale of asset			–				–				3				(2	)
Add: Relocation costs			–				–				–				9
Adjusted EBITDA		$	675			$	17			$	2,576			$	(151	)

 

Cash Flow Data

 

		Three Months Ended September 30,								Nine Months Ended September 30,
(In thousands)		2024				2023				2024				2023
Cash provided by (used in):
Operating activities		$	1,927			$	(971	)		$	1,171			$	(733	)
Investing activities			(65	)			(148	)			(127	)			(228	)
Financing activities			(201	)			(96	)			46				(260	)
Change in cash		$	1,661			$	(1,215	)		$	1,090			$	(1,221	)

 

 

 

 

 

 

v3.24.3

Cover	Nov. 04, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Nov. 04, 2024
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

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