Filing summary
Entity and period: The supplied filing is EzFill Holdings, Inc. (Nasdaq: EZFL), not NEXTNRG, Inc. It is a Form 10-K for the fiscal year ended December 31, 2022, filed March 17, 2023; it reports annual results, not a standalone 2022 fourth quarter.
Business context
EzFill operates app-based mobile fuel delivery, primarily in Florida, serving consumer, commercial fleet, and specialty customers. It reported a fleet of 24 mobile fueling trucks and expanded through new markets and the March 2022 acquisition of Full Service Fueling. The acquisition contributed approximately $113,000 of revenue and $4,000 of net loss after closing.
Financial performance
| Metric | 2022 | 2021 |
|---|---|---|
| Revenue | $15.04 million | $7.23 million |
| Cost of sales | $15.22 million | $7.03 million |
| Gross profit (loss) | $(173,513) | $206,683 |
| Operating expenses | $12.65 million | $8.10 million |
| Operating loss | $(17.49) million | $(8.77) million |
| Net loss | $(17.51) million | $(9.38) million |
| Adjusted EBITDA (non-GAAP) | $(11.41) million | $(5.85) million |
| Gallons delivered | 3.61 million | 2.31 million |
Revenue rose 108%, with gallons delivered up 57% and higher average fuel prices. Cost of sales increased 117%, producing a gross margin of approximately negative 1.2%, compared with approximately positive 2.9% in 2021. Operating expenses rose 56%, chiefly from payroll, sales and marketing, insurance, technology, and public-company costs. Net loss increased 87%; diluted loss per share was $0.66 versus $0.46.
Cash flow, liquidity, and debt
Cash and cash equivalents were $2.07 million at year-end, with $2.12 million in debt securities, for combined cash and investments of $4.19 million, down from $16.92 million at December 31, 2021. Operating cash use was $11.60 million, versus $6.31 million in 2021; investing cash use was $2.43 million; financing provided $2.53 million. Capital spending on fixed assets was $3.26 million, primarily for delivery trucks.
Total liabilities were $4.81 million. Debt included $1.00 million drawn on a securities-backed revolving line of credit and approximately $2.01 million of vehicle and other loans, including $811,516 current and $1,198,380 long-term. The bank may demand repayment of the credit line at its discretion; the line was secured by the investment portfolio. Current assets were $5.43 million and current liabilities $3.30 million.
The auditor’s report includes a going-concern explanatory paragraph. Management said operating losses and cash use were expected to continue and that additional capital would be needed by March 31, 2023, or the company might have to curtail or cease operations. Management stated available liquidity was expected to fund activities only through that date.
Material changes, outlook, and risks
- Impairments: The company recorded $2.89 million of impairment charges, including a $1.99 million impairment of the Fuel Butler technology license, $166,838 for remaining goodwill, and $258,114 for vehicle-construction materials. The license dispute and proposed termination left the company uncertain about the agreement; it said it did not expect significant license-related revenue in 2023 and did not expect near-term New York expansion.
- Capital and dilution: In February 2023, EzFill established an at-the-market offering of up to $2.096 million, with a 3% sales commission. By March 10, 2023, it had sold 67,141 shares for $26,601 gross proceeds. The company also entered a consulting arrangement involving options for up to 1.6 million shares, subject to vesting and performance terms.
- Listing risk: Nasdaq had granted an extension through May 15, 2023, to regain the $1 minimum bid-price requirement; the company said it might use a reverse stock split. Failure to comply could lead to delisting.
- Operating risks: Risks include fuel-price volatility and margin pressure, customer concentration and cancelable customer relationships, reliance on a small number of fuel suppliers, fuel-handling and environmental liabilities, competition and electric-vehicle adoption, and changing mobile-fueling regulations. Two customers generated approximately 32% and 11% of 2022 revenue.
- Management commentary: The company’s stated strategy was to grow in Florida and pursue expansion into new markets, using fleet customers and business partnerships to build local demand. The filing gives no specific revenue, earnings, or profitability guidance.
- Controls and audit: Management reported effective disclosure controls and internal control over financial reporting at year-end. The auditor issued an unmodified opinion on the financial statements, with the separate going-concern warning noted above.
Important facts for investors to verify
- Confirm the filing entity: this document is EzFill Holdings, Inc. (EZFL), not NEXTNRG, Inc.
- Check whether EzFill raised sufficient capital after the stated March 31, 2023 liquidity deadline, and review subsequent cash burn and financing terms.
- Review subsequent results for improvement in gross margin, operating losses, and operating cash use.
- Verify the outcome of the Nasdaq bid-price deficiency and any reverse stock split or delisting action.
- Confirm the status and financial consequences of the Fuel Butler license dispute and any related share-return or termination agreement.
- Assess the impact of customer and supplier concentration, vehicle-loan obligations, and the callable secured line of credit.