Cool Holdings Earnings 2020-10-31

Balance Sheet	Income Statement	Cash Flow
Assets, Equity	Rev, G Profit, Net Income	Ops, Inv, Fin

10-Q 1 simp-10q_20201031.htm 10-Q simp-10q_20201031.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 31, 2020

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to __________

Commission File Number—001-32217

Simply, Inc.

(Exact name of registrant as specified in its charter)

Maryland

33-0599368

(State or other jurisdiction of

incorporation or organization)

(IRS Employer

Identification Number)

2001 NW 84^th Avenue, Miami, FL 33122

(Address of principal executive offices including zip code)

(786) 254-6709

(Registrant’s telephone number, including area code)

Cool Holdings, Inc.

(Former Name, if Changed Since Last Report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading

Symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.001 per share

SIMP

OTC Markets Group Inc.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files) Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☒
Emerging growth company	☐

If an emerging growth company, indicate by check mark 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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of December 14, 2020, the Registrant had 11,009,022 shares outstanding of its $0.001 par value common stock.

Simply, Inc.

FORM 10-Q

For the 13 weeks ended October 31, 2020

Table of Contents

	PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements:
	Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (unaudited)	3
	Condensed Consolidated Balance Sheets	4
	Condensed Consolidated Statements of Stockholders’ Deficit (unaudited)	5
	Condensed Consolidated Statements of Cash Flows (unaudited)	6
	Notes to Condensed Consolidated Financial Statements (unaudited)	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 4.	Controls and Procedures	27
	PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	29
Item 1A.	Risk Factors	29
Item 6.	Exhibits	33

Part I. FINANCIAL INFORMATION

Item 1. Financial Statements

Simply, Inc.

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)

(Amounts in thousands, except per share data)

(unaudited)

	3rd Fiscal Quarter						Year-to-Date
	13 Weeks Ended October 31, 2020			Three Months Ended Sept. 30, 2019			39 Weeks Ended October 31, 2020			Nine Months Ended Sept. 30, 2019			Transition Period January 1 to February 1, 2020
Net sales	$	16,923		$	4,143		$	48,516		$	8,598		$	5,285
Cost of sales		12,078			3,066			34,647			6,881			3,777
Gross profit		4,845			1,077			13,869			1,717			1,508
Selling, general and administrative expenses		6,473			2,960			20,050			10,458			2,358
Operating loss		(1,628	)		(1,883	)		(6,181	)		(8,741	)		(850	)
Other income (expense):
Interest		(35	)		(1,335	)		(995	)		(2,965	)		(532	)
Decrease (increase) in fair value of derivative liability		—			277			543			277			(807	)
Gain (loss) on extinguishment of debt		—			—			13,642			(9	)		—
Other income, net		175			3			117			17			—
Income (loss) from continuing operations before provision for income taxes		(1,488	)		(2,938	)		7,126			(11,421	)		(2,189	)
Provision for income taxes		(10	)		—			(27	)		(1	)		—
Income (loss) from continuing operations		(1,498	)		(2,938	)		7,099			(11,422	)		(2,189	)
Income (loss) from discontinued operations		51			(386	)		(185	)		(1,175	)		66
Net income (loss)	$	(1,447	)	$	(3,324	)	$	6,914		$	(12,597	)	$	(2,123	)
Basic income (loss) per share:
Continuing operations	$	(0.14	)	$	(3.28	)	$	0.75		$	(13.43	)	$	(0.50	)
Discontinued operations	$	0.01		$	(0.43	)	$	(0.02	)	$	(1.38	)		0.02
Total	$	(0.13	)	$	(3.71	)	$	0.73		$	(14.81	)	$	(0.48	)
Diluted income (loss) per share:
Continuing operations	$	(0.14	)	$	(3.28	)	$	0.72		$	(13.43	)	$	(0.50	)
Discontinued operations		0.01			(0.43	)	$	(0.02	)		(1.38	)		0.02
Total	$	(0.13	)	$	(3.71	)	$	0.70		$	(14.81	)	$	(0.48	)
Weighted-average number of common shares outstanding:
Basic		11,013			895			9,497			851			4,378
Diluted		11,013			895			9,811			851			4,378
Comprehensive income (loss):
Net income (loss)	$	(1,447	)	$	(3,324	)	$	6,914		$	(12,597	)	$	(2,123	)
Foreign currency translation adjustments		(20	)		34			40			—			(85	)
Comprehensive income (loss)	$	(1,467	)	$	(3,290	)	$	6,954		$	(12,597	)	$	(2,208	)

Accompanying notes are an integral part of these condensed consolidated financial statements.

Simply, Inc.

Condensed Consolidated Balance Sheets

(Amounts in thousands, except per share data)

	October 31, 2020			December 31, 2019			February 1, 2020
	(unaudited)						(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	1,704		$	2,638		$	1,972
Restricted cash		1,255			1,196			1,197
Trade accounts receivable, net of allowance for doubtful accounts of $8, $39 and $17, respectively		180			1,151			706
Other accounts receivable		662			1,701			1,735
Inventory		6,015			7,396			7,652
Prepaid assets		835			846			877
Current assets of discontinued operations		9			1,560			713
Total current assets		10,660			16,488			14,852
Property and equipment, net		916			858			808
Operating lease right-of-use assets		9,149			7,504			8,760
Intangibles, net		1,949			2,055			2,044
Goodwill		699			699			699
Other assets		270			245			245
Total assets	$	23,643		$	27,849		$	27,408
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	6,673		$	6,040		$	6,080
Accrued expenses and other current liabilities		2,740			5,408			5,286
Current portion of operating lease liabilities		2,818			2,577			2,768
Notes payable		2,270			13,227			13,685
Derivative liability		—			1,721			2,527
Current liabilities of discontinued operations		953			3,792			2,225
Total current liabilities		15,454			32,765			32,571
Long-term liabilities:
Notes payable		2,578			85			—
Operating lease liabilities		6,643			5,023			6,109
Total liabilities		24,675			37,873			38,680
Commitments and Contingencies
Stockholders’ deficit:
Preferred stock, $0.001 par value, 10,000 shares authorized; 2 shares issued and outstanding as of all periods presented.		—			—			—
Common stock, $0.001 par value, 150,000 shares authorized; 11,009; 4,378 and 4,378 shares issued and outstanding as of October 31, 2020, December 31, 2019 and February 1, 2020, respectively.		110			44			44
Additional paid-in capital common stock		52,137			49,074			49,081
Accumulated other comprehensive income (loss)		3			(1,069	)		(201	)
Accumulated deficit		(53,282	)		(58,073	)		(60,196	)
Total stockholders’ deficit		(1,032	)		(10,024	)		(11,272	)
Total liabilities and stockholders’ deficit	$	23,643		$	27,849		$	27,408

Accompanying notes are an integral part of these condensed consolidated financial statements.

Simply, Inc.

Condensed Consolidated Statements of Stockholders’ Deficit

(Amounts in thousands)

(unaudited)

	Preferred Stock				Common Stock						Additional Paid-In			Accumulated Other Comprehensive			Accumulated
	Shares		Amount		Shares			Amount			Capital			Income (Loss)			Deficit			Total
Balance, December 31, 2019		2	$	—		4,378		$	44		$	49,074		$	(1,069	)	$	(58,073	)	$	(10,024	)
Stock-based compensation		—		—		—			—			7			—			—			7
Elimination of other comprehensive loss from sale of foreign subsidiary		—		—		—			—			—			953			—			953
Foreign currency translation		—		—		—			—			—			(85	)		—			(85	)
Net loss		—		—		—			—			—			—			(2,123	)		(2,123	)
Balance, February 1, 2020		2		—		4,378			44			49,081			(201	)		(60,196	)		(11,272	)
Stock-based compensation		—		—		300			3			148			—			—			151
Debt exchange		—		—		5,969			60			2,261			—			—			2,321
Elimination of other comprehensive loss from sale of foreign subsidiary		—		—		—			—			—			164			—			164
Foreign currency translation		—		—		—			—			—			128			—			128
Net income		—		—		—			—			—			—			10,338			10,338
Balance, May 2, 2020		2		—		10,647			107			51,490			91			(49,858	)		1,830
Stock-based compensation		—		—		299			3			495			—			—			498
Debt exchange		—		—		108			1			132			—			—			133
Foreign currency translation		—		—		—			—			—			(68	)		—			(68	)
Net loss		—		—		—			—			—			—			(1,977	)		(1,977	)
Balance, August 1, 2020		2		—		11,054			111			52,117			23			(51,835	)		416
Stock-based compensation		—		—		—			—			24			—			—			24
Issuance of shares in payment of accrued severance		—		—		23			—			23			—			—			23
Issuance of shares from reverse stock split in lieu of fractional shares		—		—		2			—			—			—			—			—
Repurchase and retirement of shares		—		—		(70	)		(1	)		(27	)		—			—			(28	)
Foreign currency translation		—		—		—			—			—			(20	)		—			(20	)
Net loss		—		—		—			—			—			—			(1,447	)		(1,447	)
Balance, October 31, 2020		2	$	—		11,009		$	110		$	52,137		$	3		$	(53,282	)	$	(1,032	)

	Preferred Stock				Common Stock						Additional Paid-In			Accumulated Other Comprehensive			Accumulated
	Shares		Amount		Shares			Amount			Capital			Loss			Deficit			Total
Balance, December 31, 2018		32	$	—		779		$	8		$	35,303		$	(1,011	)

Price	1.29	EPS	-1
Shares	9	P/E	-1
MCap	12	P/FCF	-3
Net Debt	22	EBIT	-13
TEV	34	TEV/EBIT	-3
TTM 2019-09-30, in MM, except price, ratios

10-Q	2020-10-31	Filed 2020-12-14
10-Q	2020-08-01	Filed 2020-09-15
10-Q	2020-05-02	Filed 2020-07-31
10-K	2019-12-31	Filed 2020-05-29
10-Q	2019-09-30	Filed 2019-11-19
10-Q	2019-06-30	Filed 2019-08-14
10-Q	2019-03-31	Filed 2019-05-15
10-K	2018-12-31	Filed 2019-04-16
10-Q	2018-09-30	Filed 2018-11-14
10-Q	2018-06-30	Filed 2018-08-14
10-Q	2018-03-31	Filed 2018-05-21
10-K	2017-12-31	Filed 2018-03-08
10-Q	2017-09-30	Filed 2017-11-13
10-Q	2017-06-30	Filed 2017-08-11
10-Q	2017-03-31	Filed 2017-05-12
10-K	2016-12-31	Filed 2017-03-10
10-Q	2016-09-30	Filed 2016-11-10
10-Q	2016-06-30	Filed 2016-08-05
10-Q	2016-03-31	Filed 2016-05-06
10-K	2015-12-31	Filed 2016-03-11
10-Q	2015-09-30	Filed 2015-11-06
10-Q	2015-06-30	Filed 2015-08-07
10-Q	2015-03-31	Filed 2015-05-08
10-K	2014-12-31	Filed 2015-03-10
10-Q	2014-09-30	Filed 2014-11-14
10-Q	2014-06-30	Filed 2014-08-14
10-Q	2014-03-31	Filed 2014-05-14
10-K	2013-12-31	Filed 2014-03-14
10-Q	2013-09-30	Filed 2013-11-07
10-Q	2013-06-30	Filed 2013-08-14
10-Q	2013-03-31	Filed 2013-05-14
10-K	2012-12-31	Filed 2013-03-22
10-Q	2012-09-30	Filed 2012-11-14
10-Q	2012-06-30	Filed 2012-08-14
10-Q	2012-03-31	Filed 2012-05-04
10-K	2011-12-31	Filed 2012-03-16
10-Q	2011-09-30	Filed 2011-11-10
10-Q	2011-06-30	Filed 2011-08-12
10-Q	2011-03-31	Filed 2011-05-16
10-K	2010-12-31	Filed 2011-03-31
10-Q	2010-09-30	Filed 2010-11-12
10-Q	2010-06-30	Filed 2010-08-16
10-Q	2010-03-31	Filed 2010-05-14
10-K	2009-12-31	Filed 2010-03-31

8-K	2021-01-21
8-K	2020-12-04
8-K	2020-10-21
8-K	2020-10-09
8-K	2020-07-31
8-K	2020-06-15
8-K	2020-06-05
8-K	2020-04-16
8-K	2020-04-06
8-K	2020-03-30
8-K	2020-03-27
8-K	2020-03-11
8-K	2020-01-31
8-K	2020-01-15
8-K	2019-12-30
8-K	2019-11-29
8-K	2019-11-14
8-K	2019-10-31
8-K	2019-10-24
8-K	2019-10-21
8-K	2019-10-21
8-K	2019-10-01
8-K	2019-09-20
8-K	2019-09-11
8-K	2019-07-09
8-K	2019-07-08
8-K	2019-06-05
8-K	2019-05-16
8-K	2019-05-09
8-K	2019-05-09
8-K	2019-04-23
8-K	2019-01-04
8-K	2018-12-27
8-K	2018-12-19
8-K	2018-12-14
8-K	2018-11-29
8-K	2018-10-24
8-K	2018-09-27
8-K	2018-09-13
8-K	2018-08-17
8-K	2018-08-15
8-K	2018-07-09
8-K	2018-06-08
8-K	2018-06-01
8-K	2018-04-11
8-K	2018-04-06
8-K	2018-03-27
8-K	2018-03-08
8-K	2018-03-05
8-K	2018-02-12
8-K	2018-01-19
8-K	2017-12-31

EX-31.1	simp-ex311_6.htm
EX-31.2	simp-ex312_7.htm
EX-32.1	simp-ex321_8.htm

AWSM 10Q Quarterly Report

Cool Holdings Earnings 2020-10-31