EX-99.1 2 axil-20250408_8kex99z1.htm EXHIBIT 99.1

 

AXIL Brands Reports Third Quarter Fiscal Year 2025 Financial Results

 

LOS ANGELES, April 8, 2025 (GLOBE NEWSWIRE) – AXIL Brands, Inc. (“AXIL” or the “Company”) (NYSE American: AXIL), an emerging global consumer products company for AXIL® hearing protection and enhancement products and Reviv3® hair and skin care products, announces financial and operational results for the third quarter ended February 28, 2025 (3Q25).

 

Financial Highlights for the Quarter Ended February 28, 2025

 

·Revenue in 3Q25 was $6.9 million, as compared to $6.5 million in the prior year period

 

·Gross profit as a percentage of sales was 71.7% in 3Q25, as compared to 71.5% for the prior year period

 

·Operating expenses as a percentage of sales were 63.3% in 3Q25, as compared to 73.1% for the prior year period

 

·Net income in 3Q25 was $0.6 million, as compared to $0.8 million in the prior year period

 

·Adjusted EBITDA in 3Q25 was $0.9 million, as compared Adjusted EBITDA loss of $11 thousand for the prior year period

 

·Net cash provided by operating activities for the nine months ended February 28, 2025 was $1.7 million, as compared to $0.3 million for the nine months ended February 29, 2024

 

·Cash as of February 28, 2025 was $4.7 million, as compared to $3.3 million as of May 31, 2024

 

·Basic and diluted earnings per share for 3Q25 were $0.09 and $0.07, respectively, compared to $0.13 and $0.04, respectively, in the prior year period

 

“Q325 was a strong quarter for AXIL as we continued to execute on our multi-channel growth strategy. We expanded into new geographic markets, deepened our retail distribution, and capitalized on Cyber Monday’s timing shift to drive meaningful growth in direct-to-consumer revenue,” said Jeff Toghraie, AXIL Chairman and Chief Executive Officer.

 

“Equally important, this quarter marked a meaningful inflection point in our operational performance. We delivered $0.9 million positive Adjusted EBITDA, a notable improvement from a loss in the prior-year period. We also drove a substantial reduction in operating expenses as a percentage of revenue and generated significantly higher operating cash flow. These results reflect our commitment to disciplined execution and continued progress in strengthening our core business.”

 

“We’ve also taken decisive action to proactively address risks tied to evolving U.S. trade policy. With new tariffs now in effect, we are accelerating our supply chain transition strategy—relocating key operational leadership to the U.S. and initiating plans to build out domestic manufacturing capabilities. These moves are designed not just to manage near-term disruptions, but to enhance AXIL’s long-term resilience and control over its cost structure. We believe these steps will better position the company to navigate volatility and capitalize on future growth opportunities.”

 

Use of Non-GAAP Financial Measures

 

The Company calculates EBITDA by taking net income calculated in accordance with accounting principles generally accepted in the United States (“GAAP”), and adjusting for income taxes, interest income or expense, and depreciation and amortization. The Company calculates adjusted EBITDA as EBITDA, further adjusted for stock-based compensation. Adjusted EBITDA is also presented as a percentage of revenue, which is calculated by dividing the non-GAAP Adjusted EBITDA for a period by revenue for the same period. Other companies may calculate EBITDA and adjusted EBITDA differently, limiting the usefulness of these measures for comparative purposes. The Company believes that these non-GAAP measures of financial results provide useful information regarding certain financial and business trends relating to the Company’s financial condition and results of operations, and management considers EBITDA and adjusted EBITDA important indicators in evaluating the Company’s business on a consistent basis across various periods for trend analyses. These non-GAAP financial measures exclude significant expenses and income that are required by GAAP to be recorded in the Company’s financial statements and are subject to inherent limitations as they reflect the exercise of judgments by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. Investors should not rely on any single financial measure to evaluate our business. A reconciliation of EBITDA and Adjusted EBITDA to the most comparable financial measure, net loss, calculated in accordance with GAAP is included in a schedule to this press release.

 

   

 

  

 AXIL BRANDS, INC. AND SUBSIDIARY

CONSOLIDATED EBITDA and ADJUSTED EBITDA

FOR THE THREE AND NINE MONTHS ENDED FEBRUARY 28, 2025 AND FEBRUARY 29, 2024

(UNAUDITED)

 

   For the Three Months Ended   For the Nine Months Ended 
   February 28,
2025		   February 29,
2024		   February 28,
2025		   February 29,
2024		 
                 
Net income (GAAP)  $576,662   $781,091   $1,100,563   $1,953,618 
Provision (benefit) for income taxes   53,085    (827,436)   120,335    (397,054)
Interest income, net   (42,920)   (51,420)   (97,595)   (124,454)
Depreciation and amortization   45,666    27,614    93,001    83,634 
Total EBITDA (Non-GAAP)   632,493    (70,151)   1,216,304    1,515,744 
                     
Adjustments:                    
                     
Stock-based compensation   258,053    59,099    860,517    161,314 
                     
Total Adjusted EBTIDA (Non-GAAP)  $890,546   $(11,052)  $2,076,821   $1,677,058 
                     
Sales, net (GAAP)  $6,922,367   $6,469,343   $20,506,213   $20,997,289 
                     
Adjusted EBITDA as a percentage of Sales, net (Non-GAAP)   12.9%   (0.2)%   10.1%   8.0%

 

   

 

  

AXIL BRANDS, INC. AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

 

   February 28, 2025   May 31, 2024 
   (Unaudited)     
ASSETS          
CURRENT ASSETS:          
Cash  $4,743,470   $3,253,876 
Accounts receivable, net   801,390    509,835 
Inventory, net   2,744,436    3,394,023 
Prepaid expenses and other current assets   961,876    809,126 
           
Total Current Assets   9,251,172    7,966,860 
           
OTHER ASSETS:          
Property and equipment, net   375,035    260,948 
Intangible assets, net   357,793    309,104 
Right of use asset   672,221    36,752 
Deferred tax asset   121,791    231,587 
Other assets   20,720    16,895 
Goodwill   2,152,215    2,152,215 
           
Total Other Assets   3,699,775    3,007,501 
           
TOTAL ASSETS  $12,950,947   $10,974,361 
           
LIABILITIES AND STOCKHOLDERS’ EQUITY          
           
CURRENT LIABILITIES:          
Accounts payable  $896,365   $967,596 
Customer deposits   38,586    154,762 
Contract liabilities- current   786,834    905,311 
Notes payable   140,958    146,594 
Due to related party   28,576    11,798 
Lease liability, current   227,418    36,752 
Income tax liability   120,335    242,296 
Other current liabilities   210,679    332,936 
           
Total Current Liabilities   2,449,751    2,798,045 
           
LONG TERM LIABILITIES:          
Lease liability, long term   482,842    - 
Contract liabilities- long term   361,488    480,530 
           
Total long term liabilities   844,330    480,530 
           
Total Liabilities   3,294,081    3,278,575 
           
Commitments and contingencies   -    - 
           
STOCKHOLDERS’ EQUITY:          
Preferred stock, $0.0001 par value; 300,000,000 shares authorized; 27,773,500 and 42,251,750 shares issued and outstanding as of February 28, 2025 and May 31, 2024, respectively   2,777    4,225 
Common stock, $0.0001 par value: 450,000,000 shares authorized; 6,649,852 and 5,908,939 shares issued and outstanding as of February 28, 2025 and May 31, 2024, respectively   666    591 
Additional paid-in capital   8,687,130    7,825,240 
Retained Earnings/(Accumulated deficit)   966,293    (134,270)
           
Total Stockholders’ Equity   9,656,866    7,695,786 
           
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY  $12,950,947   $10,974,361 

 

   

 

  

AXIL BRANDS, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED FEBRUARY 28, 2025 AND FEBRUARY 29, 2024

(UNAUDITED)

 

   For the Three Months Ended   For the Nine Months Ended 
   February 28,
2025		   February 29,
2024		   February 28,
2025		   February 29,
2024		 
                 
Sales, net  $6,922,367   $6,469,343   $20,506,213   $20,997,289 
                     
Cost of sales   1,955,939    1,845,017    5,888,090    5,467,458 
Gross profit  $4,966,428   $4,624,326   $14,618,123   $15,529,831 
OPERATING EXPENSES:                    
Sales and marketing  $2,994,052   $3,398,949   $9,041,283   $10,278,570 
Compensation and related taxes   200,156    228,869    667,478    713,504 
Professional and consulting   796,689    687,138    2,480,707    1,990,426 
General and administrative   392,422    413,249    1,313,377    1,213,541 
                     
Total Operating Expenses  $4,383,319   $4,728,205   $13,502,845   $14,196,041 
INCOME (LOSS) FROM OPERATIONS  $583,109   $(103,879)  $1,115,278   $1,333,790 
                     
OTHER INCOME (EXPENSE):                    
Gain on settlement   -    -    -    79,182 
Other income   3,718    6,114    8,025    19,138 
Interest income   44,191    52,915    100,162    129,233 
Interest expense and other finance charges   (1,271)   (1,495)   (2,567)   (4,779 
                     
Other income (expense), net  $46,638   $57,534   $105,620   $222,774 
                     
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES  $629,747   $(46,345)  $1,220,898   $1,556,564 
                     
Provision (benefit) for income taxes   53,085    (827,436)   120,335    (397,054 
                     
NET INCOME  $576,662   $781,091   $1,100,563   $1,953,618 
                     
NET INCOME PER COMMON SHARE:                    
Basic  $0.09   $0.13   $0.17   $0.33 
Diluted  $0.07   $0.04   $0.13   $0.11 
                     
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:                    
Basic   6,516,852    5,863,939    6,373,502    5,863,939 
Diluted   8,202,402    18,576,914    8,196,605    18,569,140 

 

   

 

 

AXIL BRANDS, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED FEBRUARY 28, 2025 AND FEBRUARY 29, 2024

(UNAUDITED)

 

   For the Nine Months Ended 
   February 28, 2025   February 29, 2024 
         
CASH FLOWS FROM OPERATING ACTIVITIES          
Net income  $1,100,563   $1,953,618 
Adjustments to reconcile net income to net cash provided by operating activities:          
Depreciation and amortization   93,001    83,634 
Provision for credit losses   31,834    143,395 
Reversal of inventory obsolescence   (23,448)   - 
Stock-based compensation   860,517    161,314 
Gain on forgiveness of account payable   (218,699)   - 
Gain on settlement   -    (79,182)
Deferred income taxes   109,796    (397,054)
Change in operating assets and liabilities:          
Accounts receivable   (323,389)   (445,883)
Inventory   673,034    (2,131,429)
Prepaid expenses and other current assets   (156,574)   145,032 
Accounts payable   147,472    1,061,420 
Other current liabilities   (322,358)   (144,052)
Contract liabilities   (237,519)   (11,490)
           
NET CASH PROVIDED BY OPERATING ACTIVITIES   1,734,230    339,323 
           
CASH FLOWS FROM INVESTING ACTIVITIES          
Purchase of intangibles   (101,690)   - 
Purchase of property and equipment   (154,088)   (80,192)
           
NET CASH USED IN INVESTING ACTIVITIES   (255,778)   (80,192)
           
CASH FLOWS FROM FINANCING ACTIVITIES          
Repayment of equipment financing   -    (2,200)
Repayment of note payable   (5,636)   (25,438)
Advances from (payments to) a related party   16,778    (176,608)
           
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES   11,142    (204,246)
           
NET INCREASE IN CASH   1,489,594    54,885 
           
CASH - Beginning of period   3,253,876    4,832,682 
           
CASH - End of period  $4,743,470   $4,887,567 
           
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:          
Cash paid during the period for:          
Interest  $2,567   $4,681 
Income taxes  $132,500   $- 
           
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING ACTIVITIES:          
Initial recognition of right of use assets recognized as lease liability  $767,269   $- 

 

   

 

  

About AXIL Brands

 

AXIL Brands (NYSE American: AXIL) is an emerging global consumer products company. The Company is a manufacturer and marketer of premium hearing enhancement and protection products, including ear plugs, earmuffs, and ear buds, under the AXIL® brand and premium hair and skincare products under its in-house Reviv3® brand - selling products in the United States, Canada, the European Union, and throughout Asia.

 

To learn more, please visit the Company's AXIL® website at www.axilbrands.com and its Reviv3® website at www.reviv3.com

 

Forward-Looking Statements

This press release contains a number of forward-looking statements within the meaning of the federal securities laws. The use of words such as “anticipate,” “believe,” “expect,” “continue,” “will,” “prepare,” “should,” and “focus,” among others, generally identify forward-looking statements. These forward-looking statements are based on currently available information, and management’s beliefs, projections, and current expectations, and are subject to a number of significant risks and uncertainties, many of which are beyond management’s control and may cause the Company’s results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include, among other things: (i) the Company’s ability to grow its net sales and operations, including developing new and improved products, diversifying and expanding its distribution and retail channels, and expanding internationally, and perform in accordance with any guidance; (ii) the Company’s ability to generate sufficient revenue to support the Company’s operations and to raise additional funds or obtain other forms of financing as needed on acceptable terms, or at all; (iii) potential difficulties or delays the Company may experience in implementing its cost savings and efficiency initiatives; (iv) the Company’s ability to compete effectively with other hair and skincare companies and hearing enhancement and protection companies; (v) the concentration of the Company’s customers, potentially increasing the negative impact to the Company by changing purchasing or selling patterns; (vi) changes in laws or regulations in the United States and/or in other major markets, such as China, in which the Company operates, including, without limitation, with respect to taxes, tariffs, trade policies or product safety, which may increase the Company’s product costs and other costs of doing business, and reduce the Company’s earnings; (vii) the Company’s ability to engage in acquisitions, investments, partnerships, strategic alliances or dispositions when desired, including the potential divestiture of the Company’s hair and skin care business; (viii) the Company’s ability to successfully accelerate its supply chain transition strategy and achieve the intended benefits; and (ix) the impact of unstable market and general economic conditions on the Company’s business, financial condition and stock price, including inflationary cost pressures, the possibility of an economic recession and other macroeconomic factors, geopolitical events, and uncertainty, increased tariffs and other trade restrictions and barriers, decreased discretionary consumer spending, supply chain disruptions and constraints, labor shortages, ongoing economic disruption, including the effects of the Ukraine-Russia conflict and conflict in the Middle East, and other downturns in the business cycle or the economy. There can be no assurance as to any of these matters, and potential investors are urged to consider these factors carefully in evaluating the forward-looking statements. Other important factors that may cause actual results to differ materially from those expressed in the forward-looking statements are discussed in the Company’s filings with the U.S. Securities and Exchange Commission. These forward-looking statements speak only as of the date hereof. Except as required by law, the Company does not assume any obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future.

 

Investor Relations:

Todd McKnight

(917) 349-2175
[email protected]