Cemtrex Reports Fourth Quarter and Full Fiscal Year 2024 Financial Results

Q4’24 Revenue Increased 9% to $18.1M, Fiscal Year 2024 Revenue Increased 13% to $66.9M

Brooklyn, NY, Dec. 30, 2024 (GLOBE NEWSWIRE) —  Cemtrex Inc. (NASDAQ: CETX, CETXP), an advanced security technology and industrial services company, has reported its financial and operational results for the fiscal fourth quarter and year ended September 30, 2024.

Key Highlights for Fiscal Year 2024

  • Revenue for the year ended September 30, 2024, increased 13% to $66.9 million, compared to revenue in the prior year of $59.4 million.
  • Revenue for Q4’24 increased 9% to $18.1 million, compared to revenue of $16.6 million for Q4’23.
  • AIS Revenue: Surged 39% to $34.8 million, capitalizing on strategic acquisitions and growing market demand.
  • Vicon Innovations: Launched NEXT™ Modular Camera System, integrating groundbreaking AI analytics and Hailo-15 edge AI processing, poised to redefine the surveillance industry.
  • Strategic Momentum: Secured a record-breaking $10.4 million order for Valerus surveillance system expansion

Management Commentary

Cemtrex Chairman and CEO, Saagar Govil, commented on the results: “Fourth quarter revenue grew 9% to $18.1 million, year over year, and for the full year increased 13% to $66.9 million, primarily driven by record demand for AIS products and services. Continued high demand for AIS products and services drove a 39% increase in revenue for fiscal 2024 to $34.8 million, offset by a 7% decrease in Vicon revenue due to the delay of multiple projects and a weaker industrywide demand for security solutions. Operating loss for the fiscal year 2024 was $5.3 million, compared to $1.5 million a year ago, mainly due to an increase in selling, general, and administrative costs.

“Our Security segment revenue in the fourth quarter grew 2% to $8.6 million despite the softening we’ve seen across the industry for the last several months. The team at Vicon is highly focused on the launch of new security technologies and products to expand its exciting portfolio and grow market share. Recently, Vicon unveiled NEXT™, a next generation modular camera platform that transforms how security integrators and end-users install, interact, and support their camera systems, primed for release in first calendar quarter of 2025. NEXT completely rethinks the traditional camera experience by reducing installation time from hours to minutes, leveraging the most powerful AI processing capabilities on the market, and deploying advanced onboard technologies and integrations.

“NEXT represents a strategic shift for Vicon. By integrating with other major video management systems, we’re expanding beyond our own ecosystem to deliver broader value in the security market. We have also integrated a disruptive AI analytic for detecting armed persons in surveillance footage to be included in NEXT Cameras. This novel detection feature is designed to function on edge devices, offering a low-cost, high-efficiency solution for assistance in the detection of armed persons in surveillance footage and enhancing the capabilities of video management systems to initiate specific responses upon detection.

“We believe that these investments in new technologies and products will enable Vicon to ramp sales in the coming year. We expect with the launch the NEXT Camera and the innovative new cloud security platform Anavio, along with new technologies and continued improvements to our core software platform Valerus, there is significant further opportunity to grow revenue and gross margin over the next several quarters including our most recent announcement of a record breaking $10.4 million order for a state government corrections facility to expand the customer’s Valerus surveillance security system with additional hardware, including enhanced storage infrastructure.

“For our Industrial services segment, AIS, the year was highlighted by new orders and record revenue growth of 39% to $34.8 million. A recent $6.7 million contract highlighted the success of AIS’s strategic entry into the wastewater infrastructure market through its acquisition of Heisey Mechanical in 2023 that significantly broadened its capabilities and expanded the markets we serve. Other projects set for completion in 2025 included several large-scale infrastructure contracts. These orders from leading companies reaffirm AIS’s optimistic growth outlook, building a pipeline of growth for 2025.

“Looking ahead, we believe 2024 has demonstrated the long-term potential of our two segments’ products and services that will drive further momentum in 2025. Vicon’s next generation cameras and software will continue to capture orders in the video surveillance market, which is expected to expand to $88.7 billion globally by 2030, according to Markets & Markets. AIS is set for another breakout year with strong order flow and an expanded market opportunity of leading companies and governmental departments. Taken together, we are confident that will deliver strong long-term value to our shareholders and drive sustainable growth for years to come,” concluded Govil.

Segment Highlights:

Vicon Industries:

  • Revenues for the year ended September 30, 2024, decreased 7% to $32.0 million compared to $34.4 million for the year ended September 30, 2023.
  • Revenues increased 2% to $8.6 million in Q4’24 compared to Q4’23.
  • Announced a record breaking $10.4 million order for a state government corrections facility in the mid-Atlantic region, expanding the customer’s Valerus surveillance security system with additional hardware, including enhanced storage infrastructure.
  • Secured a partnership with Hailo, an AI chip manufacturer known for its high-performance edge AI processors, to integrate the groundbreaking Hailo-15 System-on-a-Chip (SoC) into Vicon’s NEXT™ Modular Camera System.
  • Announced integration of an innovative Artificial Intelligence (AI) gun detection feature in its NEXT Cameras, which will be released in the first calendar quarter of 2025, marking a significant milestone in public safety and security technology.
  • Unveiled NEXT a next generation modular camera platform that transforms how security integrators and end-users install, interact, and support their camera systems.

Advanced Industrial Services:

  • Industrial Services segment revenues for the year ended September 30, 2024, increased 39% to $34.8 million compared to $25.0 million for the year ended September 30, 2023.
  • Industrial Services segment revenues for Q4’24 increased 17% to $9.6 million, on increased demand.
  • Awarded two project contracts totaling $6.7 million for upgrades at the Clearwater Road Wastewater Treatment Facility in Derry Township, Pennsylvania.
  • Awarded a $4.7 million contract for Trade in Services Agreement (TiSA) energy upgrades at Fort Indiantown Gap in Lebanon County, PA.
  • Received a $4.5 million contract for both Phase 1 and Phase 2 of the Department of General Services’ Elizabethtown Training Academy project.

Fourth Quarter and Full Year 2023 Financial Results Overview

Revenue for the full year of 2024 totaled $66.9 million, compared to revenue of $59.4 million for the full year of 2023, a 13% increase year over year. Revenues for the fourth quarter of 2024 were $18.1 million, compared to $16.6 million in the fourth quarter of 2023, an increase of 9%. The increase in revenue for the year was due to increased demand for the Company’s AIS products and services, offset by a decrease in security technology products under our Vicon brand.

The Security segment revenues for the years ended September 30, 2024, and 2023 were $32.0 million and $34.4 million, respectively, a decrease of 7%, due to decreased demand for security technology products under the Vicon brand. Industrial Services segment revenues for the full year 2024 increased by 39% to $34.8 million, up from $25.0 million in 2023, primarily due to the increase in demand for its products and services, and the additional revenue from the business related to the acquisition of Heisey Mechanical.

Gross profit for the year ended September 30, 2024, was $27.5 million, or 41% of revenues, as compared to gross profit of $25.7 million, or 43% of revenues, for the year ended September 30, 2023, mainly attributed to a decrease in gross margin percent at AIS due the Heisey acquisition. Fourth quarter gross profit of $7.6 million increased 11% from $6.8 million in the prior year quarter.

Total operating expenses for 2024 were $32.8 million compared to $27.2 million in 2023. Total operating expenses for the fourth quarter of 2024 were $7.9 compared to $6.8 in the fourth quarter of 2023. The increase in total operating expenses was primarily driven by increases in salaries and wages, general and administrative expenses, and research and development expenses related to the Security Segment’s development of proprietary technology and next generation solutions associated with security and surveillance systems software.

Operating loss for the full year of 2024 was $5.3 million as compared to an operating loss of $1.5 million for the full year of 2023. Operating loss for the fourth quarter of 2024 was $0.3 million as compared to an operating income of $.3 million for the fourth quarter of 2023. The operating loss was primarily due to overall increased general and administration expenses.

Net loss for the full year of 2024 was $7.7 million, as compared to a net loss of $9.2 million in 2023. Net income in the fourth quarter of 2024 totaled $4.4 million compared to a net loss of $1.2 million in the fourth quarter of 2023.

Cash, cash equivalents and restricted cash as of September 30, 2024 was $5.4 million, compared to $6.3 million as of September 30, 2023.

Inventories decreased to $7.0 million at September 30, 2024, from $8.7 million at September 30, 2023.

About Cemtrex

Cemtrex Inc. (CETX) is a company that owns two operating subsidiaries: Vicon Industries Inc and Advanced Industrial Services Inc.

Vicon Industries, a subsidiary of Cemtrex Inc., is a global leader in advanced security and surveillance technology to safeguard businesses, schools, municipalities, hospitals and cities. Since 1967, Vicon delivers mission-critical security surveillance systems, specializing in engineering complete security solutions that simplify deployment, operation and ongoing maintenance. Vicon provides security solutions for some of the largest municipalities and businesses in the U.S. and around the world, offering a wide range of cutting-edge and compliant security technologies, from AI-driven video analytics to fully integrated access control solutions. For more information visit www.vicon-security.com

AIS – Advanced Industrial Services, a subsidiary of Cemtrex, Inc., is a premier provider of industrial contracting services including millwrighting, rigging, piping, electrical, welding. AIS Installs high precision equipment in a wide variety of industrial markets including automotive, printing & graphics, industrial automation, packaging, and chemicals. AIS owns and operates a modern fleet of custom designed specialty equipment to assure safe and quick installation of your production equipment. Our talented staff participates in recurring instructional training, provided to ensure that the most current industry methods are being utilized to provide an efficient and safe working environment. For more information visit www.ais-york.com

For more information visit www.cemtrex.com.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the closing of the offering, gross proceeds from the offering, our new product offerings, expected use of proceeds, or any proposed fundraising activities. These forward-looking statements are based on management’s current expectations and are subject to certain risks and uncertainties that could cause actual results to differ materially from those set forth in or implied by such forward looking statements. Statements made herein are as of the date of this press release and should not be relied upon as of any subsequent date. These risks and uncertainties are discussed under the heading “Risk Factors” contained in our Form 10-K filed with the Securities and Exchange Commission. All information in this press release is as of the date of the release and we undertake no duty to update this information unless required by law.

Investor Relations

Chris Tyson
Executive Vice President – MZ North America
Direct: 949-491-8235
[email protected]  
www.mzgroup.us

Cemtrex, Inc. and Subsidiaries

Consolidated Balance Sheets

    September 30,   September 30,
Assets     2024       2023  
Current assets        
Cash and cash equivalents   $ 3,897,511     $ 5,329,910  
Restricted cash     1,522,881       1,019,652  
Trade receivables, net     11,159,676       9,209,695  
Trade receivables, net – related party     685,788       1,143,342  
Inventory, net     6,988,529       8,739,219  
Contract assets, net     985,207       1,739,201  
Prepaid expenses and other current assets     1,456,687       2,112,022  
Total current assets     26,696,279       29,293,041  
         
Property and equipment, net     9,133,578       9,218,701  
Right-of-use operating lease assets     1,933,378       2,287,623  
Royalties receivable, net – related party     456,611       674,893  
Note receivable, net – related party           761,585  
Goodwill     3,708,347       4,381,891  
Other     2,187,265       1,836,009  
Total Assets   $ 44,115,458     $ 48,453,743  
         
Liabilities & Stockholders’ Equity        
Current liabilities        
Accounts payable   $ 4,520,173     $ 6,196,406  
Accounts payable – related party           68,509  
Sales tax payable     73,024       35,829  
Revolving line of credit     3,125,011        
Current maturities of long-term liabilities     4,732,377       14,507,711  
Operating lease liabilities – short-term     832,823       741,487  
Deposits from customers     408,415       57,434  
Accrued expenses     2,034,352       2,784,390  
Contract liabilities     1,254,204       980,319  
Deferred revenue     1,297,616       1,583,406  
Accrued income taxes     314,827       388,627  
Total current liabilities     18,592,822       27,344,118  
Long-term liabilities        
Long-term debt     13,270,178       9,929,348  
Long-term operating lease liabilities     1,159,204       1,607,202  
Other long-term liabilities     274,957       501,354  
Deferred Revenue – long-term     658,019       727,928  
Warrant liabilities     5,199,436        
Total long-term liabilities     20,561,794       12,765,832  
Total liabilities     39,154,616       40,109,950  
         
Commitments and contingencies            
         
Stockholders’ equity        
Preferred stock , $0.001 par value, 10,000,000 shares authorized,         
Series 1, 3,000,000 shares authorized, 2,456,827 shares issued and        
2,392,727 shares outstanding as of September 30, 2024 and 2,293,016 shares issued and        
2,228,916 shares outstanding as of September 30, 2023 (liquidation value of $10 per share)   2,457       2,293  
Series C, 100,000 shares authorized, 50,000 shares issued and outstanding at        
September 30, 2024 and September 30, 2023     50       50  
Common stock, $0.001 par value, 70,000,000 shares authorized,        
14,176 shares issued and outstanding at September 30, 2024 and        
50,000,000 shares authorized, 498 shares issued and outstanding at September 30, 2023     14       1  
Additional paid-in capital     73,262,536       68,882,750  
Accumulated deficit     (71,355,386 )     (64,125,895 )
Treasury stock, 64,100 shares of Series 1 Preferred Stock at September 30, 2024,        
and September 30, 2023     (148,291 )     (148,291 )
Accumulated other comprehensive income     2,949,297       3,076,706  
Total Cemtrex stockholders’ equity     4,710,677       7,687,614  
Non-controlling interest     250,165       656,179  
Total liabilities and stockholders’ equity   $ 44,115,458     $ 48,453,743  
         

Cemtrex, Inc. and Subsidiaries

Consolidated Statements of Operations

    For the year ended    
    September 30, 2024   September 30, 2023    
             
Revenues            
Security Revenue   $ 32,021,899     $ 34,359,470      
Industrial Services Revenue     34,841,985       25,009,092      
Revenues     66,863,884       59,368,562      
             
Cost of revenues            
Cost of revenues, Security     15,854,560       17,253,170      
Cost of revenues, Industrial Services     23,531,120       16,429,566      
Cost of revenues     39,385,680       33,682,736      
Gross profit     27,478,204       25,685,826      
Operating expenses            
General and administrative     28,860,019       23,929,340      
Research and development     3,357,455       3,267,994      
Goodwill impairment     530,475            
Total operating expenses     32,747,949       27,197,334      
Operating loss     (5,269,745 )     (1,511,508 )    
Other (expense)/income            
Other(expense)/income, net     (622,558 )     476,693      
Interest expense     (2,169,469 )     (4,966,298 )    
Loss on excess fair value of warrants     (7,255,528 )          
Changes in fair value of warrant liability     7,840,951            
Total other expense, net     (2,206,604 )     (4,489,605 )    
Net loss before income taxes     (7,476,349 )     (6,001,113 )    
Income tax expense     (202,280 )     (394,272 )    
Loss from Continuing operations     (7,678,629 )     (6,395,385 )    
Income/(loss) from discontinued operations, net of tax     43,124       (2,838,053 )    
Net loss     (7,635,505 )     (9,233,438 )    
Less net loss in noncontrolling interest     (406,014 )     (36,563 )    
Net loss attributable to Cemtrex, Inc. stockholders   $ (7,229,491 )   $ (9,196,875 )    
(Loss)/income per share – Basic & Diluted            
Continuing Operations   $ (17.96 )   $ (15,760.64 )    
Discontinued Operations   $ 0.11     $ (3.89 )    
Weighted Average Number of Shares-Basic & Diluted     408,602       414      
             

Cemtrex, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

    For the year ended
         September 30,  
Cash Flows from Operating Activities     2024       2023    
           
Net loss   $ (7,635,505 )   $ (9,233,438 )  
           
Adjustments to reconcile net loss to net cash used by operating activities          
Depreciation and amortization     1,328,741       1,026,075    
(Gain)/loss on disposal of property and equipment     (19,133 )     69,601    
Noncash lease expense     829,119       702,747    
Goodwill impairment     530,475          
Bad debt expense (recovery)     (79,006 )     (14,515 )  
Loss on write-off of related party receivables     1,409,500          
Share-based compensation     30,235       106,839    
Shares issued to pay for services     169,000       215,800    
Interest expense paid in equity shares           409,541    
Accrued interest on notes payable     1,189,629       2,707,262    
Non-cash royalty income     (53,126 )     (44,272 )  
Amortization of original issue discounts on notes payable           1,264,111    
Amortization of loan origination costs     72,533          
Loss on excess fair value of warrants     7,255,528          
Changes in fair value of warrant liability                   (7,840,951 )                                –    
           
Changes in operating assets and liabilities net of effects from acquisition          
of subsidiaries:          
Trade receivables     (1,870,975 )     (3,795,964 )  
Trade receivables – related party     (63,462 )     (1,099,070 )  
Inventory     1,893,759       48,598    
Contract assets     753,994       (290,123 )  
Prepaid expenses and other current assets     733,168       (458,476 )  
Other assets     (251,256 )     (336,264 )  
Accounts payable     (818,733 )     3,145,469    
Accounts payable – related party           49,376    
Sales tax payable     37,195       15,734    
Operating lease liabilities     (831,536 )     (577,446 )  
Deposits from customers     350,981       (15,710 )  
Accrued expenses     (690,038 )     475,798    
Contract liabilities     273,885       393,960    
Deferred revenue     (355,699 )     522,827    
Income taxes payable     (71,285 )     293,779    
Other liabilities     (226,397 )     (306,544 )  
Net cash used by operating activities – continuing operations     (3,949,360 )     (4,724,305 )  
Net cash provided by operating activities – discontinued operations           2,491,581    
Net cash used by operating activities                 (3,949,360 )                (2,232,724 )  
           
Cash Flows from Investing Activities          
Purchase of property and equipment     (1,297,346 )     (2,761,314 )  
Proceeds from sale of property and equipment     63,953       26,205    
Royalties on related party revenues     76,000          
Acquisitions, Net of Cash Acquired           (2,793,291 )  
Investment in MasterpieceVR     (100,000 )     (100,000 )  
Net cash used by investing activities                 (1,257,393 )                (5,628,400 )  
           
Cash Flows from Financing Activities          
Proceeds on revolving line of credit     33,071,722          
Payments on revolving line of credit     (30,019,244 )        
Payments on debt     (7,923,914 )     (1,533,059 )  
Payments on Paycheck Protection Program Loans     (40,486 )     (30,286 )  
Proceeds on bank loans     340,267       3,360,000    
Proceeds from notes payable           240,000    
Purchases of treasury stock     (69,705 )        
Proceeds from offerings     10,035,292          
Expenses on offerings     (995,333 )        
Net cash provided by financing activities                   4,398,599                   2,036,655    
           
Effect of currency translation     (121,016 )     700,355    
Net decrease in cash, cash equivalents, and restricted cash     (808,154 )     (5,824,469 )  
Cash, cash equivalents, and restricted cash at beginning of period     6,349,562       11,473,676    
Cash, cash equivalents, and restricted cash at end of period   $       5,420,392     $      6,349,562    
           
           
Balance Sheet Accounts Included in Cash, Cash Equivalents, and Restricted Cash          
Cash and cash equivalents   $ 3,897,511     $ 5,329,910    
Restricted cash     1,522,881       1,019,652    
Total cash, cash equivalents, and restricted cash   $     5,420,392     $     6,349,562    
           
           
Supplemental Disclosure of Cash Flow Information:          
Cash paid during the period for interest   $ 738,307     $ 585,384    
Cash paid during the period for income taxes, net of refunds   $ 196,727     $         293,779    
           
Supplemental Schedule of Non-Cash Investing and Financing Activities          
Shares issued to pay notes payable   $    –     $ 1,917,873    
Financing of fixed asset purchase   $ 28,331     $     –    
Financing of building purchase   $    –     $ 1,200,000    
Financing of acquisition   $ –      $ 2,400,000    
Purchase of property and equipment through vendor financing   $    –     $ 675,000    
Noncash recognition of new leases   $ 474,874     $ 349,172    
         



Investor Relations
Chris Tyson
Executive Vice President – MZ North America
Direct: 949-491-8235
[email protected]  
www.mzgroup.us