OXE Marine AB (publ) Interim report 1 October to 31 December 2021

STOCKHOLM, Feb. 16, 2022 /PRNewswire/ --

Interim report

Fourth quarter 2021

• Net turnover amounted to SEK 41.8 m (SEK 4.8 m), an increase of 770% from the comparative period of the prior year.
• Gross Profit amounted to SEK 9.7 m (SEK 1.1 m) with a gross margin of 23% (23%).
• EBITDA amounted to SEK -9.0 m (SEK -17.7 m)
• Operating Loss/EBIT amounted to SEK -15.3 m (SEK -22.2 m).
• The result for the quarter amounted to SEK -17.7 m (SEK -24.4 m).
• Cash flow from operating activities improved by SEK 21.3 m for the quarter and amounted to SEK -6.4 m (SEK -27.7 m).

January – December 2021

• Net turnover amounted to SEK 99.8 m (SEK 39.7 m), an increase of 151% for the full year.
• Gross Profit amounted to SEK 25.6 m (SEK 5.5 m) with a gross margin of 26% (14%).
• EBITDA amounted to SEK -43.6 m (SEK -61.0 m).
• Operating Loss/EBIT amounted to SEK -62.3 m (SEK -77.2 m).
• The result for the year amounted to SEK -71.8 m (SEK -85.5 m).
• Cash flow from operating activities improved by SEK 51.6 m for the year and amounted to SEK -25.8 m (SEK -77.4 m).

Significant events during the Fourth quarter

• OXE Marine AB (publ) entered into an agreement to acquire 100% of Diesel Outboards and Outdoor Network Manufacturing's US distribution and manufacturing business. The purchase price of USD 10.8 million, is to be financed through a share issue in kind to the selling entity Powersports Plus LLC (an Outdoor Network Group company), making them the largest shareholder in OXE.           
• Magnus Grönborg decided to step down as CEO and the Board of Directors appointed Anders Berg as acting CEO.

Significant events after the reporting period            

• The board of directors of OXE Marine AB (publ) convened an extraordinary general meeting on 16 February 2022 and proposed inter alia that the general meeting resolves to issue new shares to Power Sports Plus, LLC, as payment for the shares in OXE Marine Inc and OXE Marine Manufacturing Inc.    
• OXE Marine AB (publ) initiated a written procedure to amend and waive certain terms in its up to MSEK 200 bonds. The proposed amendments to the Bond Terms mean that (i) the final redemption date for the bonds will be postponed by 24 months to 15 February 2025, (ii) effective from 15 August 2022, 2 percent of the quarterly interest will be paid in cash to the bondholders and the remaining interest will be quarterly compounded and added to the nominal amount of the bonds, (iii) the US Subsidiaries will be entitled to enter into a credit facility agreement of up to MUSD 5, secured by collateral in the US Subsidiaries' inventory and (iv) OXE is allowed to create a secondary pledge over its business mortgages and over the shares in the US Subsidiaries in favour of the EIB. The EIB's Tranche A loan of EUR 4 m will also be extended by 6 months in order to become repayable after the corporate bonds with a new maturity date of 12 March 2025.           
• OXE Marine AB (publ) obtained the bondholders' approval to amend and waive certain terms in its up to MSEK 200 bonds. The required majority to approve the proposal in the written procedure has consequently been met and the proposed amendments and waivers (i) – (iv) were accepted, effectively 16 February 2022.
• OXE Marine AB (publ) completed the acquisition of Diesel Outboards and Outdoor Network Manufacturing and reports from EGM. All closing conditions were satisfied, and the Transaction was completed as of 16 February 2022.    
• As a result of the completion of the Transaction, Anders Berg is today commencing his new role as CEO of the Company. Anders Berg is simultaneously stepping down as chair of the board while remaining a member of the board. The board has today resolved to elect Jonas Wikström as chair of the board until the end of the next annual general meeting.

An eventful quarter
During the fourth quarter, OXE continued to execute on the strategy as decided during Q3 2021, increasing the focus on end-customers and their product experience, expanding the core business, and setting a plan for an increased presence and deepened partnerships in selected markets. During the quarter, OXE Marine AB decided to join forces with US distributor Diesel Outboards and Outdoor Network Manufacturing to significantly strengthen the focus on commercial and distribution development.

Setting new records
During the quarter a new record was achieved for the highest net sales in a quarter as well as for the full year. Net sales amounted to SEK 41.8 m (SEK 4.8 m) for the quarter an increase of 770% compared to the comparative quarter of the previous year. For the full year net sales amounted to SEK 99.8 m (SEK 39.7 m), an increase of 151% relative to the previous year. In addition, for the second consecutive quarter, OXE had record sales of Parts & Accessories. This continues to indicate the increasing number of operative OXE engines in the market. As a result, the Company has started to disclose revenue in two segments, Propulsion and Parts & Accessories. Propulsion sales amounted to SEK 35.5 m (SEK 1.1 m), up 3,190% from the comparative period of the previous year and Parts & Accessories sales amounted to SEK 6.3 m (SEK 3.7 m), up 69% from comparative period of the previous year.

Gross margin amounted to 23%, lower than the gross margin in the previous three quarters. The lower margin was as a result of volume discounts issued to customers for reaching certain targets in the fourth quarter. Reversing the effects of the volume discounts, the gross margin would have amounted to 27%, in line with the previous three quarters and confirming the strong gross margin trend.

Market
During the quarter we moved forward with interesting projects, examples such as a customs and border control project and a governmental project, both in South East Asia, a project for a large petroleum company, projects for tenders in the Mediterranean and North Europe as well as taxi boats in Europe. Furthermore, we have signed up two new partners in Sweden and Denmark and initiated several other discussions with interesting potential future partners.

We continue to see strong demand for both our 200HP and 300HP family of engines. As a result of the Transaction our Order Book is consolidated with Diesel Outboards and moving forward, we will start to include orders from dealers and OEM's in Diesel Outboard's US territories, in our Order Book. We therefore have not reported on the Order Book during Q4.

Supply
During the quarter, we successfully continued to develop the supply chain and production capabilities together with our strong strategic partners, adding investments in hard tooling and creating "sub assembly" processes to enable increased capacity and improved quality in the supply chain. Clear progress is now visible through increased stability that sets the stage for future developments. During the quarter, we also managed well to mitigate "pandemic related" challenges in the supply chain. Our project to validate the Water Jet is also well underway for the commercial launch coming in 2022.

Cash flow
It has been encouraging to see the improvement in the Company's ability to stand on its own feet with without relying heavily on external financing. Cashflow from operating activities improved by SEK 51.6m m for the year and amounted to SEK -25.8 (SEK -77.4). At the same time our reliance on cashflow from financing activities reduced, where SEK 21.8 m was raised during 2021 relative to SEK 107.5 m in 2020. This improvement in operational cash flow has been achieved by an extreme focus on managing working capital while at the same time improving operational performance and continuing to reduce our cost base.

OXE joins forces with US distributor Diesel Outboards 
Through the Transaction, OXE significantly strengthens its position in the US market, creating a direct to market model, gaining access to end-user, dealer, governmental and OEM networks.
As an organisation, OXE gains a seasoned marine team with over 24 combined years in sales experience from one of the largest outboard manufactures in the world.  The US outboard market represents approximately 40% of the world-wide sales of outboard engines and 49% of OXE Marine's revenue. As a result of the Transaction, we also increase our ability to increase profitability in our largest market. Finally, OXE Marine AB evolves into becoming OXE Marine Group, a significant step in the history of the Company.

We are incredibly grateful for the support received towards the Transaction from the shareholders, the Bond holders and the EIB, a true indication in the belief all stakeholders have for the strategic direction the company has taken.

Change in Management
Effective 16 February I have taken on the role as CEO, continuing the outstanding work that Magnus has carried out. As I have been working in an operational capacity as well as being the Chairman, there is a smooth transition in the Management Team, and we continue to execute on the strategic work concluded during the fourth quarter.

Anders Berg
Chief Executive Officer

This disclosure contains information that OXE Marine AB is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the agency of the contact person, on 16-02-2022 19:00 CET.

CONTACT:

Certified Adviser
FNCA Sweden AB is Certified Adviser for OXE Marine AB (publ). Contact details to FNCA Sweden AB: tel. [phone], e-mail [e-mail].

For further information, please contact:
Anders Berg, CEO, [e-mail], [phone] 

OXE Marine AB (publ) (NASDAQ STO: OXE) has, after several years of development, constructed the OXE Diesel, the world's first diesel outboard engine in the high-power segment. The Company's unique patented engine-to-propulsion power transmission solutions have led to high demand for the Company's engines worldwide.

This information was brought to you by Cision http://news.cision.com

https://news.cision.com/oxe-marine-ab/r/oxe-marine-ab--publ--interim-report-1-october-to-31-december-2021,c3506988

The following files are available for download:

https://mb.cision.com/Main/16067/3506988/1535489.pdf	OXE Marine AB - Q4 2021 INTERIM REPORT
https://news.cision.com/oxe-marine-ab/i/q4-2021-interim-report,c3012222	Q4 2021 INTERIM REPORT

View original content:https://www.prnewswire.com/news-releases/oxe-marine-ab-publ-interim-report-1-october-to-31-december-2021-301483988.html

SOURCE OXE Marine AB

Copyright 2022 PR Newswire