Profire Energy Reports Financial Results for Third Quarter Fiscal Year 2022

Company Reports Sixth Consecutive Quarter of Sequential Revenue Growth and Highest Quarterly Net Income and EBITDA Since Q1 2019

LINDON, Utah, Nov. 02, 2022 (GLOBE NEWSWIRE) -- Profire Energy, Inc. (NASDAQ: PFIE), a technology company (the "Company") that provides solutions which enhance the efficiency, safety, and reliability of industrial combustion appliances, today reported financial results for its third quarter ending September 30, 2022. A conference call will be held on Thursday, November 3, 2022, at 8:30 a.m. ET to discuss the results.

Third Quarter Summary

  • Revenue of $12.8 million, an 85% increase from prior-year quarter
  • Gross margin improved 280 basis points year-over-year to 47.7%
  • Net income of $1.2 million or $0.02 per diluted share
  • Generated EBITDA of $2.4 million1
  • Revenue from strategic diversification efforts nearly doubled sequentially to $1 million, or 7.7% of revenue

“Our third quarter results represent the best quarter in the company’s recent history, with our highest revenue period since 2014 and highest quarterly net income since the first quarter of 2019,” said Ryan Oviatt, Co-Chief Executive Officer and CFO of Profire Energy. “We are pleased with the significant recovery we have been able to demonstrate this year for our business despite the many challenges of today’s economy. We remain committed to our strategic objectives of sustainable growth and industry diversification.”

Third Quarter 2022 Financial Results

Total revenues for the period equaled $12.8 million, compared to $9.6 million in the second quarter and $6.9 million in the third quarter of 2021. The sequential and year-over-year increase was primarily driven by improving customer demand, a rise in natural gas prices, and an increase in drilling and completion activity.

Gross profit was $6.1 million, compared to $4.4 million in the second quarter of 2022 and $3.1 million in the prior-year quarter. Gross margin was 47.7% of revenues, compared to 45.7% of revenues in the prior quarter and 44.9% of revenues in the third quarter of 2021. The increase in gross profit and margin reflects higher revenue and greater fixed cost coverage, partially offset by inflationary cost pressure including higher costs of freight, shipping and direct labor.

1 See “About Non-GAAP Financial Measures” below

Total operating expenses were $4.0 million, compared to $4.3 million in the second quarter and $3.4 million in the year-ago quarter. The year-over-year increase is primarily due to increases in headcount and cost inflation across the business, while the sequential decrease is related to an employee retention payroll tax credit (ERC) earned under the CARES Act. Without the decrease in payroll tax expenses provided by the ERC, operating expenses for the quarter would have been relatively flat sequentially.

Compared with the same quarter last year, operating expenses for G&A increased 15% and R&D increased 50%, while depreciation decreased 8% from the third quarter of 2021.

Net income was $1.2 million or $0.02 per diluted share, compared to net income of $284,829 or $0.01 per diluted share in the second quarter and net $92,246 or breakeven on a diluted share basis in the third quarter last year.

“We continue to experience increased levels of interest from our traditional oil and gas customer base resulting from increased drilling and completion, retrofit programs, and other capital projects that were deferred during the pandemic,” stated Cameron Tidball, Co-CEO of Profire Energy. “Revenues outside our traditional oil and gas business nearly doubled sequentially this quarter to $1 million, as we booked orders and completed projects related in the metal manufacturing, heat treating, landfill, food and beverage and renewable natural gas industries. We continue to evaluate our opportunities and believe this segment can become a meaningful contributor to the company’s overall revenue. We remain well-positioned as we close out 2022 to deliver long-term value to our shareholders.”

Conference Call

Profire Energy Executives will host the call, followed by a question-and-answer period.
Date: Thursday, November 3, 2022
Time: 8:30 a.m. ET (6:30 a.m. MT)
Toll-free dial-in number: 1-855-327-6837
International dial-in number: 1-631-891-4304

The conference call will be webcast live and available for replay via the Profire investor relations webpage: The webcast replay will be available for one year.

Please call the conference telephone number at least five minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting the conference call, please contact Todd Fugal at 1-801-796-5127.

A replay of the call will be available via the dial-in numbers below after 12:30 p.m. ET on the same day through November 17, 2022.

Toll-free replay number: 1-844-512-2921
International replay number: 1-412-317-6671
Replay Pin Number: 10020052

About Profire Energy, Inc.
Profire Energy is a technology company providing solutions that enhance the efficiency, safety, and reliability of industrial combustion appliances while mitigating potential environmental impacts related to the operation of these devices. It is primarily focused in the upstream, midstream, and downstream transmission segments of the oil and gas industry; however, it has started to succeed in several diversified non-oil and gas markets as well. Profire specializes in the engineering and design of burner and combustion management systems and solutions used on a variety of natural and forced draft applications. Its products and services are sold primarily throughout North America. It has an experienced team of sales and service professionals that are strategically positioned across the United States and Canada. Profire has offices in Lindon, Utah; Victoria, Texas; Homer, Pennsylvania; Millersburg, Ohio; and Acheson, Alberta, Canada. For additional information, visit

Cautionary Note Regarding Forward-Looking Statements. Statements made in this release that are not historical are forward-looking statements. This release contains forward-looking statements, including, but not limited to statements regarding the Company’s expected growth, delivering long-term value to shareholders, committing to strategic objectives, and financial performance through 2022 & 2023. Forward-looking statements are not guarantees of future results or performance and involve risks, assumptions and uncertainties that could cause actual events or results to differ materially from the events or results described in, or anticipated by, the forward-looking statements. Factors that could materially affect such forward-looking statements include certain economic, business, public market and regulatory risks and factors identified in the company's periodic reports filed with the Securities and Exchange Commission. All forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All forward-looking statements are made only as of the date of this release and the Company assumes no obligation to update forward-looking statements to reflect subsequent events or circumstances, except as required by law. Readers should not place undue reliance on these forward-looking statements.

Profire Energy, Inc.
Ryan Oviatt, Co-CEO & CFO
(801) 796-5127

Three Part Advisors
Steven Hooser & John Beisler

About Non-GAAP Financial Measures

To supplement our consolidated financial statements, which statements are prepared and presented in accordance with GAAP, we use the following non-GAAP financial measure of earnings before interest, taxes, depreciation and amortization (“EBITDA”). The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

We use this non-GAAP financial measure for financial and operational decision making and as a means to evaluate period-to-period comparisons. Our management believes that this non-GAAP financial measure provides meaningful supplemental information regarding our performance. We believe that both management and investors benefit from referring to this non-GAAP financial measure in assessing our performance and when planning, forecasting, and analyzing future periods. We believe this non-GAAP financial measure is useful to investors both because it allows for greater transparency with respect to key metrics used by management in its financial and operational decision making.

The Following is a tabular presentation of EBITDA, including a reconciliation to net income which the Company believes to be the most directly comparable US GAAP financial measure.

For the three Months Ended September 30, 2022
EBITDA Calculation  
Net Income $ 1,210,748  
Add back net income tax expense $ 958,300  
Add back net interest expense $ (45,107)  
Add back depreciation and amortization $ 272,204  
EBITDA calculated $ 2,396,145  

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)
    For the Three Months Ended
September 30,
  For the Nine Months Ended
September 30,
REVENUES (note 8)                
Sales of products, net   $ 11,895,881     $ 6,296,736     $ 29,634,986     $ 16,328,810  
Sales of services, net     933,457       646,462       2,330,639       1,741,020  
Total Revenues     12,829,338       6,943,198       31,965,625       18,069,830  
COST OF SALES                
Cost of sales - product     5,960,311       3,217,655       14,873,075       8,666,168  
Cost of sales - services     750,151       606,075       2,013,825       1,451,775  
Total Cost of Sales     6,710,462       3,823,730       16,886,900       10,117,943  
GROSS PROFIT     6,118,876       3,119,468       15,078,725       7,951,887  
OPERATING EXPENSES                
General and administrative     3,413,048       2,980,945       10,591,986       8,319,353  
Research and development     435,059       290,657       1,105,571       848,993  
Depreciation and amortization     152,876       166,155       479,473       500,492  
Total Operating Expenses     4,000,983       3,437,757       12,177,030       9,668,838  
INCOME (LOSS) FROM OPERATIONS     2,117,893       (318,289 )     2,901,695       (1,716,951 )
OTHER INCOME (EXPENSE)                
Gain on sale of assets     12,887       31,685       323,570       144,078  
Other income (expense)     (6,839 )     (2,984 )     (43,567 )     1,755  
Interest income     45,107       33,067       86,959       82,698  
Total Other Income     51,155       61,768       366,962       228,531  
INCOME (LOSS) BEFORE INCOME TAXES     2,169,048       (256,521 )     3,268,657       (1,488,420 )
INCOME TAX BENEFIT (EXPENSE)     (958,300 )     348,767       (1,145,919 )     582,000  
NET INCOME (LOSS)   $ 1,210,748     $ 92,246     $ 2,122,738     $ (906,420 )
Foreign currency translation gain (loss)   $ (591,282 )   $ (263,908 )   $ (723,209 )   $ 39,183  
Unrealized gains (losses) on investments     (172,802 )     (20,811 )     (594,596 )     26,744  
Total Other Comprehensive Income (Loss)     (764,084 )     (284,719 )     (1,317,805 )     65,927  
COMPREHENSIVE INCOME (LOSS)   $ 446,664     $ (192,473 )   $ 804,933     $ (840,493 )
BASIC EARNINGS (LOSS) PER SHARE   $ 0.03     $     $ 0.04     $ (0.02 )
FULLY DILUTED EARNINGS (LOSS) PER SHARE   $ 0.02     $     $ 0.04     $ (0.02 )
BASIC WEIGHTED AVG NUMBER OF SHARES OUTSTANDING     47,036,012       48,239,236       47,201,611       48,095,404  
FULLY DILUTED WEIGHTED AVG NUMBER OF SHARES OUTSTANDING     48,558,207       49,328,808       48,761,346       48,095,404  

These financial statements should be read in conjunction with the Form 10-Q and accompanying footnotes.

Condensed Consolidated Balance Sheets
    As of
    September 30, 2022   December 31, 2021
ASSETS   (Unaudited)    
Cash and cash equivalents   $ 5,639,865     $ 8,188,270  
Short-term investments     867,658       1,013,683  
Accounts receivable, net     8,933,905       6,262,799  
Inventories, net (note 3)     10,205,207       7,185,248  
Prepaid expenses and other current assets (note 4)     2,642,512       1,025,276  
Income tax receivable           560,445  
Total Current Assets     28,289,147       24,235,721  
Net deferred tax asset     185,772       163,254  
Long-term investments     7,944,181       8,259,809  
Financing right-of-use asset     132,760       65,280  
Property and equipment, net     10,374,126       11,185,539  
Intangible assets, net     1,312,660       1,549,138  
Goodwill     2,579,381       2,579,381  
Total Long-Term Assets     22,528,880       23,802,401  
TOTAL ASSETS   $ 50,818,027     $ 48,038,122  
Accounts payable   $ 2,008,126     $ 1,822,559  
Accrued liabilities (note 5)     3,157,221       1,872,348  
Current financing lease liability (note 6)     53,084       30,214  
Income taxes payable     570,430        
Total Current Liabilities     5,788,861       3,725,121  
Net deferred income tax liability     480,105       136,106  
Long-term financing lease liability (note 6)     80,684       35,912  
TOTAL LIABILITIES     6,349,650       3,897,139  
STOCKHOLDERS' EQUITY (note 7)        
Preferred stock: $0.001 par value, 10,000,000 shares authorized: no shares issued or outstanding            
Common stock: $0.001 par value, 100,000,000 shares authorized: 52,078,283 issued and 47,040,153 outstanding at September 30, 2022, and 51,720,142 issued and 47,643,233 outstanding at December 31, 2021     52,079       51,720  
Treasury stock, at cost     (7,336,323 )     (6,107,593 )
Additional paid-in capital     31,570,226       30,819,394  
Accumulated other comprehensive loss     (3,418,272 )     (2,100,467 )
Retained earnings     23,600,667       21,477,929  
TOTAL STOCKHOLDERS' EQUITY     44,468,377       44,140,983  
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY   $ 50,818,027     $ 48,038,122  

These financial statements should be read in conjunction with the Form 10-Q and accompanying footnotes.

Condensed Consolidated Statements of Cash Flows
  For the Nine Months Ended September 30,
  2022   2021
Net income (loss) $ 2,122,738     $ (906,420 )
Adjustments to reconcile net income (loss) to net cash provided by operating activities:      
Depreciation and amortization expense   831,036       971,712  
Gain on sale of property and equipment   (314,059 )     (144,078 )
Gain on sale of intangibles   (9,511 )      
Bad debt expense   40,948       2,622  
Stock awards issued for services   605,955       474,881  
Changes in operating assets and liabilities:      
Accounts receivable   (2,620,155 )     (904,325 )
Income taxes receivable/payable   1,130,931       (606,128 )
Inventories   (3,190,546 )     946,865  
Prepaid expenses and other current assets   (1,668,442 )     532,519  
Deferred tax asset/liability   307,663       49,851  
Accounts payable and accrued liabilities   1,566,810       540,322  
Net Cash Provided by (Used in) Operating Activities   (1,196,632 )     957,821  
Proceeds from sale of property and equipment   464,574       101,169  
Proceeds from sale of intangibles   85,000        
Purchase of investments   (133,371 )     (881,588 )
Purchase of property and equipment   (370,791 )     (138,562 )
Net Cash Provided by (Used in) Investing Activities   45,412       (918,981 )
Value of equity awards surrendered by employees for tax liability   (94,802 )     (42,829 )
Cash received in exercise of stock options   31,084       2,673  
Purchase of treasury stock   (1,228,731 )      
Principal paid towards lease liability   (28,145 )     (31,911 )
Net Cash Used in Financing Activities   (1,320,594 )     (72,067 )
Effect of exchange rate changes on cash   (76,591 )     14,331  
NET DECREASE IN CASH   (2,548,405 )     (18,896 )
CASH AT BEGINNING OF PERIOD   8,188,270       9,148,312  
CASH AT END OF PERIOD $ 5,639,865     $ 9,129,416  
Interest $ 2,331     $ 2,689  
Income taxes $ 21,000     $ 17,150  
Common stock issued in settlement of accrued bonuses $ 212,787     $  

These financial statements should be read in conjunction with the Form 10-Q and accompanying footnotes. 

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Source: Profire Energy, Inc.