UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Commission file number:
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) |
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(IRS Employer Identification No.) |
(Address of principal executive offices) |
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(Zip Code) |
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( (Registrant's telephone number, including area code) |
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Securities registered pursuant to Section 12(b) of the Act: |
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Title of each class: |
Trading Symbol: |
Name of Each Exchange on which Registered |
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.
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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.:
Large accelerated filer |
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Non-accelerated filer |
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Smaller reporting company |
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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
Number of shares of each class of the issuer's common stock outstanding as of the latest practicable date.
Class |
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As of July 6, 2023 |
Class A Common Stock |
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Class B Common Stock |
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VOXX International Corporation and Subsidiaries
Table of Contents
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PART I |
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Item 1 |
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Consolidated Balance Sheets at May 31, 2023 (unaudited) and February 28, 2023 |
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3 |
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5 |
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6 |
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Unaudited Consolidated Statements of Cash Flows for the Three Months Ended May 31, 2023 and 2022 |
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7 |
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8 |
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Item 2 |
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
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31 |
Item 3 |
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42 |
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Item 4 |
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42 |
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PART II |
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Item 1 |
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43 |
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Item 1A |
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43 |
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Item 2 |
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43 |
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Item 6 |
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44 |
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45 |
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2
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
VOXX International Corporation and Subsidiaries
Consolidated Balance Sheets
(In thousands, except share and per share data)
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May 31, |
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February 28, |
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(unaudited) |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
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$ |
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Accounts receivable, net |
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Inventory |
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Receivables from vendors |
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Due from GalvanEyes LLC (Note 20) |
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— |
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Prepaid expenses and other current assets |
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Income tax receivable |
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Total current assets |
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Investment securities |
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Equity investment |
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Property, plant and equipment, net |
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Operating lease, right of use assets |
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Goodwill |
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Intangible assets, net |
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Deferred income tax assets |
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Other assets |
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Total assets |
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$ |
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$ |
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Liabilities, Redeemable Equity, Redeemable Non-Controlling Interest, and Stockholders' Equity |
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Current liabilities: |
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Accounts payable |
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$ |
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$ |
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Accrued expenses and other current liabilities |
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Income taxes payable |
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Accrued sales incentives |
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Contingent consideration, current (Note 5) |
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Interim arbitration award payable (Note 23) |
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Contract liabilities, current |
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Current portion of long-term debt |
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Total current liabilities |
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Long-term debt, net of debt issuance costs |
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Finance lease liabilities, less current portion |
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Operating lease liabilities, less current portion |
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Deferred compensation |
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Deferred income tax liabilities |
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Other tax liabilities |
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Prepaid ownership interest in EyeLock LLC due to GalvanEyes LLC (Note 20) |
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Other long-term liabilities |
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Total liabilities |
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(Note 23) |
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Redeemable equity (Note 8) |
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Redeemable non-controlling interest (Note 2) |
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Stockholders' equity: |
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Preferred stock: |
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Common stock: |
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Class A, $ |
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Class B Convertible, $ |
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Paid-in capital |
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Retained earnings |
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Accumulated other comprehensive loss |
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( |
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Less: Treasury stock, at cost, |
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( |
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Less: Redeemable equity |
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( |
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( |
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Total VOXX International Corporation stockholders' equity |
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Non-controlling interest |
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( |
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( |
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Total stockholders' equity |
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Total liabilities, redeemable equity, redeemable non-controlling interest, and stockholders' equity |
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$ |
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$ |
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3
See accompanying notes to unaudited consolidated financial statements.
4
VOXX International Corporation and Subsidiaries
Unaudited Consolidated Statements of Operations and Comprehensive Loss
(In thousands, except share and per share data)
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Three months ended |
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2023 |
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2022 |
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Net sales |
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$ |
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$ |
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Cost of sales |
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Gross profit |
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Operating expenses: |
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Selling |
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General and administrative |
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Engineering and technical support |
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Acquisition costs |
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— |
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Total operating expenses |
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Operating loss |
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( |
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Other (expense) income: |
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Interest and bank charges |
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( |
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( |
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Equity in income of equity investee |
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Interim arbitration award (see Note 23) |
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( |
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( |
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Other, net |
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( |
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( |
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Total other expense, net |
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( |
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( |
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Loss before income taxes |
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( |
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( |
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Income tax benefit |
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( |
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( |
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Net loss |
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( |
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( |
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Less: net loss attributable to non-controlling interest |
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( |
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Net loss attributable to VOXX International Corporation and Subsidiaries |
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$ |
( |
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$ |
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Other comprehensive income (loss): |
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Foreign currency translation adjustments |
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( |
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Derivatives designated for hedging |
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( |
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Pension plan adjustments |
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Other comprehensive income (loss), net of tax |
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( |
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Comprehensive loss attributable to VOXX International Corporation and Subsidiaries |
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$ |
( |
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$ |
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Loss per share - basic: Attributable to VOXX International Corporation and Subsidiaries |
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$ |
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$ |
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Loss per share - diluted: Attributable to VOXX International Corporation and Subsidiaries |
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$ |
( |
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$ |
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Weighted-average common shares outstanding (basic) |
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Weighted-average common shares outstanding (diluted) |
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See accompanying notes to unaudited consolidated financial statements.
5
VOXX International Corporation and Subsidiaries
Unaudited Consolidated Statements of Stockholders' Equity
For the three months ended May 31, 2023 and 2022
(In thousands, except share and per share data)
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Class A |
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Paid-in |
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Retained |
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Accumulated |
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Non- |
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Treasury |
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Redeemable Equity |
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Total |
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Balances at February 28, 2023 |
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$ |
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$ |
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$ |
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$ |
( |
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$ |
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$ |
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$ |
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$ |
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Net loss |
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— |
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— |
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( |
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— |
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( |
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— |
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— |
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( |
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Other comprehensive income, net of tax |
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— |
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— |
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— |
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— |
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— |
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— |
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Repurchase of |
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— |
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— |
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— |
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— |
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— |
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( |
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— |
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Stock-based compensation expense |
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— |
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— |
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— |
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— |
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— |
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Balances at May 31, 2023 |
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Balances at February 28, 2022 |
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$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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Net loss |
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— |
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— |
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( |
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— |
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( |
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— |
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— |
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( |
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Other comprehensive loss, net of tax |
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— |
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— |
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— |
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( |
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— |
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— |
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— |
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Cash settlement of market stock units upon vesting of |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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Net settlement of |
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— |
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— |
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— |
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— |
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— |
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( |
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Reclassification of stockholders' equity to redeemable equity |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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Stock-based compensation expense |
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— |
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— |
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Balances at May 31, 2022 |
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See accompanying notes to unaudited consolidated financial statements.
6
VOXX International Corporation and Subsidiaries
Unaudited Consolidated Statements of Cash Flows
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Three months ended |
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2023 |
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2022 |
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Cash flows from operating activities: |
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Net loss |
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$ |
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$ |
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Adjustments to reconcile net loss to net cash provided by (used in) operating activities: |
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Depreciation and amortization |
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Amortization of debt discount |
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Bad debt expense (recovery) |
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Reduction in the carrying amount of the right of use asset |
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Gain on forward contracts |
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Equity in income of equity investees |
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Distribution of income from equity investees |
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Deferred income tax benefit |
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( |
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Non-cash compensation adjustment |
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Stock based compensation expense |
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Gain on disposal of property, plant, and equipment |
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Gain on sale of intangible asset |
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Changes in operating assets and liabilities: |
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Accounts receivable |
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Inventory |
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Receivables from vendors |
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Prepaid expenses and other |
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( |
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Investment securities-trading |
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Accounts payable, accrued expenses, accrued sales incentives, contract liabilities, and other liabilities |
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( |
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Income taxes payable |
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< | |||||||