8-K
Brownie's Marine Group, Inc (BWMG)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) November 16, 2020
Brownie’s Marine Group, Inc.
(Exact name of registrant as specified in its charter)
| Florida | 333-99393 | 90-0226181 |
|---|---|---|
| (State or other jurisdiction of incorporation or organization) | (Commission<br><br> <br>File Number) | (I.R.S. Employer<br><br> <br>Identification No.) |
3001NW 25 Avenue, Suite 1, Pompano Beach, FL 33069
(Addressof principal executive offices)(Zip Code)
Registrant’s telephone number, including area code: (954) 462-5570
(Formername or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| [ ] | Written<br> communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| [ ] | Soliciting<br> material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| [ ] | Pre-commencement<br> communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| [ ] | Pre-commencement<br> communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| none | not<br> applicable | not<br> applicable |
Indicate by check mark whether the registrant is an emerging growth company as defined in in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company [ ]
If an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
Item7.01 Regulation FD.
On November 16, 2020, Brownie’s Marine Group, Inc., issued a press release announcing its financial and operating results for the nine months ended September 30, 2020. A copy of this press release is furnished as Exhibit 99.1 to this report.
Pursuant to General Instruction B.2 of Form 8-K, the information in this Item 7.01 of Form 8-K, including Exhibit 99.1, is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise be subject to the liabilities of that section, nor is it incorporated by reference into any filing of Brownie’s Marine Group. Inc. under the Securities Act of 1933 or the Securities Exchange Act of 1934, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
Item9.01 Financial Statements and Exhibits.
(d) Exhibits.
| Incorporated by Reference | Filed or<br><br> <br>Furnished<br><br> <br>Herewith | ||||
|---|---|---|---|---|---|
| No. | Exhibit Description | Form | Date Filed | Number | |
| 99.1 | Press Release dated November 16, 2020 | Furnished |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Brownie’s<br> Marine Group, Inc. | ||
|---|---|---|
| Date:<br> November 16, 2020 | By: | /s/ Christopher H. Constable |
| Christopher<br> H. Constable, Chief Executive Officer |
Exhibit99.1
Brownie’sMarine Group Announces 98.6% Increase in Net Revenues, 3.3% Net Profit Margin for Fiscal Third Quarter 2020
POMPANOBEACH, FL /GLOBE NEWSWIRE/ November 16, 2020 / Brownie’s Marine Group, Inc. (OTCQB: BWMG), a leading developer, manufacturer and distributor of tankless dive equipment and high pressure air and industrial compressors in the marine industry, today announced results for the fiscal third quarter and nine months ending September 30, 2020.
“Brownie’s had a strong third quarter despite the challenges facing the country and the economy thus far in 2020. We believe that COVID19 has brought families back together and looking for outdoor, fun activities that they can share as a family unit. In our primary market of warm water destinations, we believe that the Brownie’s Third Lung and Nemo systems are the perfect family fun activity.” said Christopher Constable, Chief Executive Officer. “The third quarter showed a great recovery from Q2, and we can feel the momentum building for our products. The Nemo product line is finding acceptance across the globe and has developed a great platform to help complete the vertical integration of the diving experience. The company is in a great cash position heading into the fourth quarter, and is focusing on flattening our seasonality curve by focusing on sub-equatorial geographical diving areas that will expand demand during the traditionally winter months in the US.”
3rdFiscal Quarter Highlights
| ● | Net<br> Revenues increased 98.6% to $1.7 million versus $.8 million last year; |
|---|---|
| ● | Net<br> Income was $.05 million versus a loss of $.32 million last year; |
| ● | Adjusted<br> Net Income was $309,200 versus ($113,000) in the same period last year; and |
| ● | At<br> the close of the third quarter, cash and cash equivalents totaled $769,600, and a working capital balance of $770,236. |
NineMonths ended September 30, 2020 Highlights
| ● | Net<br> Revenues increased 62.3% to $3.6 million versus $2.2 million last year; |
|---|---|
| ● | Revenue<br> from BLU3, launched in Q4, 2019, contributed $1.1 million for the nine months ended September 30, 2020 or 79% of overall growth.<br> The BLU Vent project accounted for 15.8% of consolidated revenues for the nine month period. |
| ● | Net<br> Loss through Q3, 2020 was ($0.6) million versus ($0.8) million for Q3 last year; and |
| ● | Adjusted<br> Net Income for the nine months ending September 30, 2020 was $371,500 versus ($468,400) in the same period last year. |
SelectFinancial Metrics: Fiscal 3rd Quarter and Nine Months Ended
September30, 2020 Comparisons
| (in thousands) | Q320 | Q319 | Change | YTD20 | YTD19 | Change | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total Net Revenues | $ | 1,670.6 | $ | 841.4 | 98.6 | % | $ | 3,626.0 | $ | 2,233.6 | 62.3 | % | |||||
| Legacy SSA Products – Brownies Third Lung | $ | 1,271.7 | $ | 683.0 | 86.2 | % | $ | 2,192.2 | $ | 1,762.5 | 24.4 | % | |||||
| High Pressure Gas Systems – LW Anerica’s | $ | 79.0 | $ | 158.4 | -50.1 | % | $ | 352.4 | $ | 471.1 | -25.2 | % | |||||
| Ultra-Portable Tankless Dive Systems – Blu3 | $ | 320.2 | $ | 0.0 | NM | $ | 1,081.4 | $ | 0.0 | NM | |||||||
| Operating Income (loss) | $ | 59.0 | $ | (319.9 | ) | 118.4 | % | $ | (639.5 | ) | $ | (820.5 | ) | 22.1 | % | ||
| Net Income (loss) | $ | 56.5 | $ | (322.0 | ) | 117.5 | % | $ | (654.2 | ) | $ | (826.3 | ) | 20.8 | % | ||
| Adjusted Net Income (loss) | $ | 309.9 | $ | (11330 | ) | 373.6 | % | $ | (371.5 | $ | (468.4 | ) | 179.3 | % | |||
| NM = not measurable/meaningful |
Q42020 Commentary
“We have great momentum heading into the fourth quarter. We are looking to see further value come from our digital marketing program with Figment Design, and are expecting big things from our Nemo products as we head into the holiday season” says Robert M. Carmichael, President and Chairman of the Board, “We expect our partnership with Amazon,com along with other methods to get the Nemo in front of the public during the holidays to expand our customer base and bring an entire new group of divers into the market.”
Non-GAAPFinancial Measures
This press release includes certain financial measures that exclude the impact of certain items and therefore have not been calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). We report adjusted net income (loss) to measure our overall results because we believe it better reflects our net results by excluding the impact of non-cash equity-based compensation. We believe the presentation of adjusted net income (loss) enhances our investors’ overall understanding of the financial performance of our business.
We believe that investors should have access to the same set of tools that we use in analyzing our results. This non-GAAP measure should be considered in addition to results prepared in accordance with GAAP but should not be considered a substitute for or superior to GAAP results.
The following is an unaudited reconciliation of adjusted net income (loss) to net income (loss) for the periods presented:
| Three Months Ended <br><br>September 30, | Nine Months Ended <br><br>September 30, | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| 2020 | 2019 | 2020 | 2019 | ||||||||
| Net income (loss) | $ | 56,535 | $ | (321,964 | ) | $ | (654,200 | ) | $ | (826,315 | ) |
| plus: | |||||||||||
| Stock issued for services | 28,046 | 102,875 | 250,721 | 252,127 | |||||||
| Stock-based compensation incentive bonus shares issued to CEO and employees | 5,862 | - | 241,670 | - | |||||||
| Stock-based compensation – options | 218,505 | 105,761 | 533,300 | 105,761 | |||||||
| Adjusted net income (loss) | $ | 308,948 | $ | (113,328 | ) | $ | 371,491 | $ | (468,427 | ) |
AboutBrownie’s Marine Group
Brownie’s Marine Group, Inc., is the parent company to a family of innovative brands with a unique concentration in the industrial, and recreational diving industry. The Company, together with its subsidiaries, designs, tests, manufactures, and distributes recreational hookah diving, yacht-based scuba air compressors and nitrox generation systems, and scuba and water safety products in the United States and internationally. The Company has three subsidiaries: Trebor Industries, Inc., founded in 1981, dba as “Brownie’s Third Lung”; BLU3, Inc.; and Brownie’s High-Pressure Services, Inc., dba LW Americas. The Company is headquartered in Pompano Beach, Florida.
For more information, visit: www.BrowniesMarineGroup.com.
SafeHarbor Statement
This press release may contain forward looking statements which are based on current expectations, forecasts, and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially from those anticipated or expected. Actual results and the timing of certain events could differ materially from those projected in or contemplated by the forward-looking statements due to a number of factors. Stockholders and potential investors should not place undue reliance on these forward-looking statements. Although we believe that our plans, intentions and expectations reflected in or suggested by the forward-looking statements in this report are reasonable, we cannot assure stockholders and potential investors that these plans, intentions or expectations will be achieved. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. Except to the extent required by law, we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, a change in events, conditions, circumstances or assumptions underlying such statements, or otherwise. You are urged to carefully review and consider any cautionary statements and other disclosures, including the statements made under the heading “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 as filed with the Securities and Exchange Commission (the “SEC”) and our other periodic and quarterly filings with the SEC.
Source: Brownie’s Marine Group, Inc.
Contact Information: (954)-462-5570
investors@browniesmarinegroup.com