Amortization of right of use assets          1,585        898 
      Loss on disposal of property and 
       equipment                                       -        116 
Changes in Assets and Liabilities 
      Accounts receivable                         (2,128)    (3,039) 
      Inventories                                 14,765      7,939 
      Prepaid expenses                                38        801 
      Prepaid inventory                             (365)       (72) 
      Other current assets                          (635)       149 
      Other assets                                  (445)         - 
      Income taxes payable                           174         (4) 
      Accounts payable and accrued expenses       (1,657)       343 
      Accrued tariffs                                168        300 
      Deferred revenue                             4,833          - 
      Customer deposits                              (12)       (21) 
                                                 -------    ------- 
Total Adjustments                                 26,061        404 
                                                 -------    ------- 
Net Cash Used in Operating Activities             (4,712)   (16,727) 
                                                 -------    ------- 
 
Cash Flows From Investing Activities 
Purchase of property and equipment                (1,691)    (6,507) 
                                                 -------    ------- 
Net Cash Used in Investing Activities             (1,691)    (6,507) 
                                                 -------    ------- 
 
(Continued) 
Cash Flows From Financing Activities 
      Proceeds from public offering                          21,640 
      Proceeds from public offering $(ATM.UK)$, net     1,705        671 
      Proceeds from note payable, related 
       party                                       2,700      1,000 
      Repayment of note payable, related party    (2,700)    (1,000) 
      Repayment of note payable                              (5,275) 
      Proceeds from exercise of public 
       warrants                                        -        747 
      Proceeds from exercise of options                4        359 
      Proceeds from exercise of Investor 
       Warrants                                                 546 
                                                ---------   ------- 
      Net Cash Provided by Financing 
       Activities                                  1,709     18,688 
                                                 -------    ------- 
 
Net Decrease in Cash and cash equivalents         (4,694)    (4,546) 
Cash and cash equivalents - beginning of 
 period                                           12,713     17,781 
                                                 -------    ------- 
Cash and cash equivalents - end of period       $  8,019   $ 13,235 
                                                 =======    ======= 
 
Supplemental Disclosures of Cash Flow 
Information: 
      Cash paid for income taxes                       -        237 
      Cash paid for interest                    $  4,782   $  4,361 
                                                 =======    ======= 
Supplemental Non-Cash Items 
      Purchases of property and equipment, not 
       yet paid                                 $  2,460   $     53 
                                                 =======    ======= 
      Recognition of right of use asset 
       obtained in exchange for operating 
       lease liability                          $ 18,653   $      - 
                                                 =======    ======= 
      Recognition of leasehold improvements 
       obtained in exchange for operating 
       lease liability                          $  4,683   $      - 
                                                 =======    ======= 
      Recognition of warrant liability          $  6,381   $ 13,762 
                                                 =======    ======= 
      Settlement of accrued liability for 
       employee liability for employee stock 
       purchase plan                            $    112   $      - 
                                                 =======    ======= 
      Non-cash impact of cash exercise of 
       liability classified warrants            $      -   $    617 
                                                 =======    ======= 
      Cashless exercise of liability 
       classified warrants                      $      -   $ 12,629 
                                                 =======    ======= 
 

Use of Non-GAAP Financial Measures

The Company provides non-GAAP financial measures including EBITDA and Adjusted EBITDA as a supplement to GAAP financial information to enhance the overall understanding of the Company's financial performance and to assist investors in evaluating the Company's results of operations, period over period. Adjusted non-GAAP measures exclude significant unusual items. Investors should consider these non-GAAP measures as a supplement to, and not a substitute for financial information prepared on a GAAP basis.

Adjusted EBITDA

Adjusted EBITDA is considered a non-GAAP financial measure under the rules of the SEC because it excludes certain amounts included in net loss calculated in accordance with GAAP. Specifically, the Company calculates Adjusted EBITDA by EBITDA adjusted to exclude stock-based compensation expense and changes in fair market value of warrant liabilities.

The Company has included Adjusted EBITDA because it is a key measure used by Dragonfly's management team to evaluate its operating performance, generate future operating plans, and make strategic decisions, including those relating to operating expenses. As such, the Company believes Adjusted EBITDA is helpful in highlighting trends in the ongoing core operating results of the business.

Adjusted EBITDA has limitations as an analytical tool, and it should not be considered in isolation or as a substitute for analysis of net loss or other results as reported under GAAP. Some of these limitations are:

   -- Adjusted EBITDA does not reflect the Company's cash expenditures, future 
      requirements for capital expenditures, or contractual commitments; 
   -- Adjusted EBITDA does not reflect changes in, or cash requirements for, 
      the Company's working capital needs; 
   -- Adjusted EBITDA does not reflect the Company's tax expense or the cash 
      requirements to pay taxes; 
   -- although amortization and depreciation are non-cash charges, the assets 
      being amortized and depreciated will often have to be replaced in the 
      future and Adjusted EBITDA does not reflect any cash requirements for 
      such replacements; 
   -- Adjusted EBITDA should not be construed as an inference that the 
      Company's future results will be unaffected by unusual or non-recurring 
      items for which the Company may adjust in historical periods; and 
   -- other companies in the industry may calculate Adjusted EBITDA differently 
      than the Company does, limiting its usefulness as a comparative measure. 

Reconciliations of Non-GAAP Financial Measures

EBITDA and Adjusted EBITDA

The following table presents reconciliations of EBITDA and Adjusted EBITDA to the most directly comparable GAAP financial measure for each of the periods indicated.

 
                   Dragonfly Energy Holdings Corp. 
               For the Three Months Ended September 30 
           (in thousands, except share and per share data) 
                                                   2024      2023 
 
Net Loss Before Taxes                            $(6,779)  $(10,007) 
      Interest Expense                             5,615      3,987 
      Depreciation and Amortization                  327        316 
                                                  ------    ------- 
EBITDA                                           $  (837)  $ (5,704) 
 
Adjusted for EBITDA 
      Stock Based Compensation                       256        946 
      Change in fair market value of warrant 
       liability                                  (4,875)       145 
                                                  ------    ------- 
Adjusted EBITDA                                  $(5,456)  $ (4,613) 
 

Source: Dragonfly Energy Holdings Corp.

(END) Dow Jones Newswires

November 14, 2024 16:15 ET (21:15 GMT)