Financial Analysis
Summary:
- • Total Revenue improved greatly at $123k which is the second highest month YTD ($594k YTD) and margins at 29% (32% YTD). $111k in revenue from 6 install projects and service revenue at $11k. OPEX at $16k (lowest since Jan) and net income at $19.2k ($65.3k YTD).
- • Cash runway improved greatly to 3.1 months. Cash & AR at $185k, AP & CC at $129k, with $101k in Customer Prepayments
Key metrics:
• Install Rev: YTD $594k, Margin 33%; Jul-19 $111k, Margin 30%
• Service Revenue: YTD $58.7k, Margin 61%; Jul-19 $11k, Margin 61%
• Device Revenue: YTD $34k, Margin 32%; Jul-19 $250
• Net Income: YTD $65k; Jul-19 $19k
Revenue & Margin
• Install Margins: 6 projects completed in the month: [Project 1] 32% margin; [Project 2] 30% margin; [Project 3] 38% margin; [Project 4] 36% margin; [Project 5] 32% margin; and [Project 6] 19% margin (also a service project with 89% margins, probably misclassed some COGS – reviewing with team).
Cash Flow: ($1.9k) cash increase YTD ($63k lower than net income) – A lot of puts and takes but essentially operating cash flow is better than net income by about $12k thanks to A/R+Customer Prepayments, which has all been pulled out as owner draw ($85.7k)
• A/R and Customer Prepayments $51k positive
• A/P and Credit Cards $4.7k negative
• Warranty Liability $7k positive (non-cash expense recognizing on PnL, limited actual warranty work)
• Net Owner Draw: $85.7k YTD negative ($5k Draw in July)
• WIP $24k negative
• Payroll $3.6 negative (timing of wages recognition and cash out of account)
Balance Sheet:
• A/R: $86k total outstanding at end of month ($60k of which is still o/s as of Aug 11) – a few aged items totaling $10.5k mainly for [Project 11] (project delayed)
• A/P: $89k total outstanding at end of month ($89k of which is still o/s as of Aug 11) all [Vendor 1]
• WIP: $22k of projects in process: Largest – [Project 7] $11k; [Project 8] $9.5k; [Project 9] $6.9k: (Expensed Aug WIP for completed Projects) – shows $28.8k on the BS but that is pulling back Labor and materials purchased in this month to prior closed month.
• Customer Prepayments: $101k balance at July 31, 2019 – $53k increase over prior month balance – 14 projects, 3 largest are [Project 7], [Project 8], and [Project 9].
• -$1,482 due from vendors
• -$1,231.73 payment from Progressive for van – to be paid out for repair
• -$250 returned check for [Project 3] job – owed to [Contractor 1], determining how to pay him
• $7,128 undeposited funds – One payment, [Project 7], hits bank this month on the 2nd.
• Payroll Payable -$933 related to overpay of overtime on payroll, to be recovered on future payroll
COGS & Expense Notes: Opex at $19k
• $4.4k Other Direct Labor COGS – Payroll not allocated to customers mainly from PTO (Second highest month YTD)
• $655 Other Direct Materials COGS – Truck Stock
• $886 Fuel – Auto