Strong Global Entertainment, Inc. (“Strong Global Entertainment” or
the “Company”) (NYSE American: SGE), today announced preliminary
operating results for the first quarter ended March 31, 2023. The
Company completed its initial public offering (IPO) on May 15, 2023
and expects to file a Form 10-Q for the first quarter ended March
31, 2023 in June 2023.
Operational Highlights
- Revenue is
expected to be $10.0 million for the first quarter of 2023 compared
to $9.7 million in the first quarter of 2022. The increase from the
prior year was due to $0.7 million of higher service revenue,
partially offset by a $0.5 million decrease in product revenue.
Cinema service and screen revenue grew 36% and 23%, respectively,
related to the acceleration of laser projection upgrade projects.
Revenue from non-cinema customers declined primarily due to timing
of several large immersive and military projects in the first
quarter of 2022. The Company has increased the scope of its
services to better support its customers and to increase market
share in cinema services, including cinema screen installation work
performed for certain of its customers. The Company expects the
upgrades from xenon to laser to accelerate throughout 2023 and
continue for at least the next several years.
- Gross profit is
expected to be $2.3 million, or 23.3% of revenue, in the first
quarter of 2023 compared to $2.2 million, or 22.7% of revenue, in
the first quarter of 2022. Gross margins on product sales are
expected to increase as the product mix improves with a greater
proportion of the revenue derived from cinema screen sales in the
current period. Gross margin in the services business during the
first quarter of 2023 was impacted by additional travel, overtime,
and outside contractor costs to meet customer demand. The Company
expects gross margins to improve as it increases staffing levels to
meet demand and reduce reliance on outside service providers.
Mark Roberson, Chief Executive Officer of Strong
Global Entertainment, commented, “Strong Global Entertainment is
seeing increasing momentum as the cinema industry recovery
accelerates and the demand for cinema services continues to grow.
From a seasonality perspective, the first quarter is typically our
lightest with both screen sales and installations, and we expect
the revenue generated from these parts of our business to increase
as we move through 2023. Additionally, with the cinema industry
recording its highest first quarter box office results since 2019,
and with Apple and Amazon now directing their original content into
theaters instead of straight to streaming platforms, we believe
that our business is positioned to build considerable momentum. We
also continue to add new managed service contracts and are seeing
increased demand for our laser projection upgrade capabilities,
enhancing an already robust outlook for the balance of 2023.”
The Company will be presenting at the LD Micro
Invitational XIII on Wednesday, June 7.
The preliminary financial results in this press
release are estimates. They are unaudited and are subject to change
upon completion of the Company’s financial statement closing
procedures. These estimates should not be viewed as a substitute
for our full interim or annual financial statements prepared in
accordance with U.S. generally accepted accounting principles.
Accordingly, you should not place undue reliance on this
preliminary data. The preliminary financial data has been prepared
by, and is the responsibility of, our management. Our independent
registered public accounting firm has not audited, reviewed,
compiled or performed any procedures with respect to the
accompanying preliminary financial data. Accordingly, our
independent registered public accounting firm does not express an
opinion or any other form of assurance with respect thereto.
About Strong Global Entertainment,
Inc.
Strong Global Entertainment, Inc. is a leader in
the entertainment industry, providing mission critical products and
services to cinema exhibitors and entertainment venues for over 80
years. The Company manufactures and distributes premium large
format projection screens, provides comprehensive managed services,
technical support and related products and services primarily to
cinema exhibitors, theme parks, educational institutions, and
similar venues. In addition to traditional projection screens, the
Company manufactures and distributes its Eclipse curvilinear
screens, which are specially designed for theme parks, immersive
exhibitions, as well as simulation applications. It also provides
maintenance, repair, installation, network support services and
other services to cinema operators, primarily in the United States.
The Company also owns Strong Studios, Inc., which develops and
produces original feature films and television series.
About FG Group Holdings Inc.
FG Group Holdings Inc. (NYSE American: FGH) is a
diversified holding company with operations and investments across
a broad range of industries. The Company has a majority ownership
in Strong Global Entertainment, (NYSE American: SGE), which
includes STRONG/MDI Screen Systems (www.strongmdi.com), the leading
premium screen and projection coatings supplier in the world and
Strong Technical Services (www.strong-tech.com), which provides
comprehensive managed service offerings with 24/7/365 support
nationwide to ensure solution uptime and availability. FG Group
Holdings also holds equity stakes in GreenFirst Forest Products
Inc., Firefly Systems, Inc., and FG Financial Group, Inc., as well
as real estate through its Digital Ignition operating business.
About Fundamental Global®
Fundamental Global® is a private partnership
focused on long-term strategic holdings. Fundamental Global® was
co-founded by former T. Rowe Price, Point72 and Tiger Cub portfolio
manager Kyle Cerminara and former Chairman and CEO of TD
Ameritrade, Joe Moglia. Its current holdings include FG Financial
Group Inc., FG Group Holdings Inc., BK Technologies Corp.,
GreenFirst Forest Products, Inc., FG Merger Corp., FG Acquisition
Corp., OppFi Inc., Hagerty Inc., and FG Communities, Inc.
The FG® logo is a registered trademark of
Fundamental Global®.
Forward Looking Statements
This press release contains “forward-looking
statements” that are subject to substantial risks and
uncertainties. All statements, other than statements of historical
fact, contained in this press release are forward-looking
statements. Forward-looking statements contained in this press
release may be identified by the use of words such as “anticipate,”
“believe,” “contemplate,” “could,” “estimate,” “expect,” “intend,”
“seek,” “may,” “might,” “plan,” “potential,” “predict,” “project,”
“target,” “aim,” “should,” "will” “would,” or the negative of these
words or other similar expressions, although not all
forward-looking statements contain these words. Forward-looking
statements are based on the Company’s current expectations and are
subject to inherent uncertainties, risks and assumptions that are
difficult to predict. Further, certain forward-looking statements
are based on assumptions as to future events that may not prove to
be accurate. These and other risks and uncertainties are described
more fully in the section titled “Risk Factors” in the final
prospectus related to the public offering filed with the SEC.
Forward-looking statements contained in this announcement are made
as of this date, and the Company undertakes no duty to update such
information except as required under applicable law.
Investor Relations
Contact:Mark RobersonStrong
Global Entertainment, Inc. - Chief Executive Officer(704)
471-6784IR@strong-entertainment.com
John Nesbett/Jennifer BelodeauIMS Investor
Relations(203) 972-9200sge@imsinvestorrelations.com
Strong Global Entertainm... (AMEX:SGE)
Historical Stock Chart
Von Apr 2024 bis Mai 2024
Strong Global Entertainm... (AMEX:SGE)
Historical Stock Chart
Von Mai 2023 bis Mai 2024