CE Brands reports lower 2024 revenue, due to termination of Kodak license agreement
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Canadian consumer-electronics distributor CE Brands Inc. reported lower annual 2024 sales for the year ending March 31, citing a significant drop due to the termination of their Kodak license agreement and lower B2C sales. The company did, however, register an improvement in gross profit and a substantial reduction in net loss.
Revenue decreased by $840,000, reflecting a 62% drop in the three month period ended March 31, 2024 as compared to the corresponding period of the prior year. Revenue for the year ended March 31, 2024, was $1.93 million as compared to $7.56 million for the year ended March 31 2023. The decreases can be attributed to the termination of the trademark license agreement between Eastman Kodak Co. and CE Brands, the company said, which ended the sales of Kodak products, lower Business to Consumer (“B2C”) sales of Motorola watches on e-commerce platforms in the first fiscal quarter of 2024 (April 2023 to June 2023) and there being no B2C sales until late fiscal 2024, while the company negotiated a new contract with Motorola.
Gross profit was $0.13 million in the three months ended March 31, 2024, a $2.58 million improvement to the same period in the prior year. For the year ended March 31, 2024, gross profit was $700,000 as compared to gross loss of $4.18 million in the prior year. The improvement was due to sales of the Moto 70 and Moto 40 watches during the three 12-month periods ended March 31, 2024, both bearing higher gross profit ratios than compared to Kodak products, which held a considerable portion of sales during the corresponding periods ended March 31, 2023.
There was a net loss of $1.31 million for the three-month period ended March 31, 2024, which represents a 92% improvement compared to the $17.34 million net loss for the corresponding period in fiscal 2023. The decrease in net loss was due to lower operating expenditures and comparative increase in gross profit ratio for the three months ended March 31, 2024, the company said.
“Our improved capital structure and lower debt costs, alongside strengthened relationships with suppliers and customers, are driving positive momentum,” said Kalvie Legat, Interim Chief Executive Officer of CE Brands. “With sales picking up and new product launches on the horizon, we’re focused on operational execution to drive growth and deliver value to our stakeholders.”
At the end of Fiscal 2023, the company sought to terminate its Kodak licensing agreement. According to public filings, CE Brands made lump sum payments to Eastman Kodak Co. to extract itself from the contract. Products sold under the Kodak brand included security cameras.
The following tables summarise certain financial data derived from the Fiscal 2024, 2023, and 2022 Consolidated Financial Statements:
| As at | March 31, 2024 | March 31, 2023 | March 31, 2022 |
| Total revenue | 1,932,421 | 7,565,377 | 7,297,081 |
| Net Income (loss) | 4,171,904 | (28,073,361) | (10,217,783) |
| Basic and diluted loss per share | $0.20 | ($11.10) | ($4.50) |
| Total assets | 1,376,925 | 1,995,279 | 13,901,561 |
| Total non-current financial liabilities | 3,812,362 | 5,097,002 | 3,390,528 |
The Company’s Fiscal 2024 Consolidated Financial Statements reflect the balances of CEBI and its wholly-owned subsidiary, CE Brands International Inc. as well as EBN and its wholly-owned subsidiaries up until Deconsolidation. The comparative period figures reflect the balances of CEBI and of EBN and its wholly-owned subsidiaries.
About CE Brands
CE Brands Inc. develops products with leading manufacturers and iconic brand licensors by utilising proprietary data that identifies key market opportunities.