SMG Industries, Inc.(SMGI), a prominent player in the industrial sector, has released its unaudited consolidated financial statements for the second quarter of 2023. The report showcases a mixed performance as the company experienced a net loss of $1.76 million during the quarter, while simultaneously witnessing a substantial surge in revenue, which reached $21.79 million. These financial results provide insight into the company's operations and financial stability.
Overview of Financial Position
As of June 30, 2023, SMG Industries reported current assets amounting to $15.69 million. Notably, the company's cash and cash equivalents stood at $209,843, exhibiting a growth from $127,225 reported at the end of 2022. Additionally, restricted cash remained consistent at $1.11 million.
Property and Equipment Depreciation
The value of property and equipment, after accounting for accumulated depreciation, totaled $4.29 million at the end of Q2 2023. This indicated a decrease from the $5.41 million reported at the close of 2022.
Liabilities and Stockholders' Deficit
SMG Industries' liabilities and stockholders' deficit amounted to $51.85 million at the close of Q2 2023. This figure represented a significant increase compared to the $48.70 million reported at the end of 2022. The company's current liabilities included accounts payable, accounts payable from related parties, and accrued expenses, among others.
Remarkable Revenue Growth
Despite facing challenges, SMG Industries achieved remarkable revenue growth in Q2 2023. The company reported revenues of $21.79 million, showcasing a substantial increase from the $18.08 million generated in the same period of 2022.
Gross Profit and Operating Expenses
The company's gross profit for Q2 2023 amounted to $2.93 million, experiencing notable growth from $1.14 million in the same quarter of the previous year. However, operating expenses, including selling, general, and administrative costs, amounted to $2.72 million, compared to $2.29 million in Q2 2022.
Despite the impressive revenue growth, SMG Industries faced a net loss of $1.76 million in Q2 2023, a reduction from the net loss of $3.02 million reported in the corresponding period of 2022. The company's net loss per common share from continuing operations stood at $0.04, indicating a slight improvement from the $0.08 loss reported in Q2 2022.
Financial Changes in Stockholders' Equity
Changes in Stockholders' Equity
The company's financial statements revealed changes in stockholders' equity. While SMG Industries issued new shares and experienced fluctuations in additional paid-in capital, the accumulated deficit increased. The total stockholders' deficit amounted to $31.25 million at the end of Q2 2023, expanding from $26.52 million at the close of 2022.
Despite the net loss incurred during the second quarter of 2023, SMG Industries demonstrated robust revenue growth, indicating resilience and potential for future profitability. The company's financial position, stockholders' equity, and revenue generation are key areas to watch as SMG Industries navigates the challenges and opportunities within the industrial sector.