Turbo Energy, S.A. — FY2023 Form 20-F
Reporting period: Fiscal year ended December 31, 2023. This is an annual report, not a standalone Q4 report. The audited consolidated financial statements are prepared under IFRS as issued by the IASB. The independent auditor issued an unqualified opinion on the financial statements.
Business context
Turbo Energy designs, develops and distributes photovoltaic generation, storage and energy-management products, including batteries, inverters, Sunbox all-in-one systems and software. Spain remains its primary market. The company began expanding into commercial and industrial products and additional sales channels, including major retailers and e-mobility, during 2023.
Financial performance and liquidity
| Metric | FY2023 | FY2022 |
|---|---|---|
| Total revenue | €13.14 million | €31.15 million |
| Gross profit and margin | €1.10 million; 8.3% | €4.60 million; 14.8% |
| Operating income (loss) | (€2.64 million) | €1.67 million |
| Net income (loss) | (€2.01 million) | €1.03 million |
| Net margin | (15.3%) | 3.3% |
| Cash from operating activities | €182,845 provided | €5.65 million used |
| Cash and cash equivalents at year-end | €620,531 | €502,585 |
| Short-term investments at year-end | €2.04 million | None reported |
| Working capital | €3.30 million | €3.67 million |
Year-end bank loans and credit lines totaled approximately €3.99 million, of which €3.90 million was current. Amounts due to related parties were €3.85 million, including a €3.8 million five-year loan from parent Umbrella Solar at 6.25% interest. Total liabilities were €9.97 million. Financing cash flow was €2.52 million, including €3.35 million of net IPO proceeds and €4.21 million of proceeds from related parties, partly offset by credit-line repayments and other payments.
Changes versus the prior year
- Revenue fell 58%, driven mainly by weaker Spanish photovoltaic demand. Management cited higher interest rates, a 58% average decline in energy prices and reduced consumer purchasing power following inflation.
- Battery revenue declined 63% to €6.58 million; inverter revenue fell 60% to €3.13 million. Photovoltaic-module revenue fell to €633,398 as modules became a marginal product category.
- New revenue streams included €1.14 million from e-mobility and €273,501 from Go Solar. Sunbox revenue was €804,244.
- The company moved from profit to loss as lower sales reduced gross profit while selling and administrative expenses increased 24% to €2.54 million. Interest expense rose to €406,031.
- Operating cash flow turned positive, primarily alongside a substantial inventory reduction. Investing cash outflow increased to €2.59 million, including €2.04 million placed in short-term investments and €516,684 spent on software-related intangible assets.
Outlook, risks and unusual items
- No quantified revenue or earnings guidance is provided. Management expects available resources and cash flows, together with IPO proceeds, to fund planned operations and expansion for at least 12 months; it also cites support from the Umbrella Solar group. Additional financing may nevertheless be needed.
- Management’s plans include expanding sales through retailers and B2C channels, growing commercial and industrial offerings, and pursuing international markets. These are plans, not reported financial guidance.
- Key risks include dependence on a small group of customers, demand sensitivity to electricity prices and interest rates, competition, and reliance on Chinese suppliers—particularly a single inverter supplier. Sunbox assembly also relies on one Spanish supplier, and supplier arrangements generally lack written contracts.
- Product quality, warranty, cybersecurity, regulatory and intellectual-property risks are disclosed. A Spanish trademark dispute over “SOLARBOX” resulted in an order to stop using the mark; the company reports compliance, while assessment of court costs remained pending.
- Related-party activity was material: 2023 related-party revenue was €1.38 million, related-party purchases were €1.20 million, and management fees to Umbrella Solar were reported at approximately €1.0 million. The filing describes a cost-allocation arrangement with a margin, but gives inconsistent descriptions of the applicable margin.
- Management identified significant deficiencies in financial-reporting controls, including inadequate segregation of duties, formal procedures, account reconciliations and IFRS training, while concluding controls were effective. The filing notes that no auditor attestation of internal control was required.
- After year-end, the board approved 1,806,620 restricted share units, equivalent to 361,324 ADSs, for certain officers, directors and employees. The company also changed its CEO in December 2023, with Mariano Soria assuming the role.
Most important facts for investors to verify
- Reconcile the filing’s differing presentations of revenue, cost of revenue and cash-flow descriptions against the audited statements; the audited statements report €13.14 million in revenue and €182,845 of operating cash provided.
- Assess whether liquidity can support expansion, given €620,531 cash, current bank and credit-line obligations of €3.90 million, and the related-party loan and other related-party balances.
- Track demand recovery, customer concentration and progress converting retailer, e-mobility and international initiatives into recurring sales and improved margins.
- Review the related-party cost allocation and the disclosure’s inconsistent descriptions of its margin, along with the recoverability of related-party receivables and customer balances.
- Monitor remediation of the disclosed control deficiencies, inventory obsolescence provisions, and potential dilution from equity awards or future capital raising.