Business context and reporting period
This is EzFill Holdings, Inc.’s Form 10-K for the fiscal year ended December 31, 2023, filed April 1, 2024. The filing does not report NextNRG, Inc. as the registrant: it identifies EzFill Holdings, Inc. (Nasdaq: EZFL), a South Florida-based mobile fuel delivery business. EzFill’s proposed acquisition of NextNRG was still pending at the financial-statement date; the filing says it had not closed.
EzFill delivers fuel to consumer, commercial fleet, and specialty customers using mobile fueling trucks and an app-based platform. It reported 24 trucks and operations in South Florida, Tampa, and Orlando.
Financial performance and position
| Metric | 2023 | 2022 |
|---|---|---|
| Revenue | $23.22 million | $15.04 million |
| Gross profit (loss) | $1.37 million | $(0.17) million |
| Gross margin | 5.9% | (1.2%) |
| Operating loss | $(8.82) million | $(17.49) million |
| Net loss | $(10.47) million | $(17.51) million |
| Adjusted EBITDA, non-GAAP | $(6.01) million | $(11.41) million |
| Cash used in operating activities | $(6.64) million | $(11.60) million |
Revenue increased 54% year over year. Management attributed the growth to higher fuel volume and average price per gallon, and said improved delivery fees and driver efficiency helped restore positive gross profit. Operating expenses declined 42%, while interest expense increased to $1.72 million from $98,834, primarily reflecting borrowing for trucks. The company reported 5,853,167 gallons delivered and an average fuel margin of $0.65 per gallon, versus 3,589,415 gallons and $0.50 in 2022. However, management’s text says gallons increased 39%; the reported volumes imply an increase of about 63%.
At year-end, cash was $226,985, current assets were $1.77 million, and current liabilities were $6.98 million, producing a $5.21 million working-capital deficit. Total liabilities were $7.62 million and stockholders’ deficit was $1.91 million. Notes payable totaled approximately $6.10 million, including $4.80 million of related-party notes shown as current; the debt maturity schedule lists $5.75 million due in 2024. Cash and investments were $226,985 at year-end, versus $4.19 million at December 31, 2022.
Material changes, outlook, and key risks
- Liquidity and going concern: The auditor’s report includes a going-concern explanatory paragraph, citing losses and insufficient revenue to fund operations. The filing reports a $10.47 million net loss, $6.64 million operating cash outflow, and substantial doubt about the company’s ability to continue as a going concern. Management says additional capital is needed and may not be available on acceptable terms; it expects continuing operating losses and cash use.
- Financing and dilution: The company relied on debt, including related-party funding, and disclosed further related-party notes issued after year-end. Some notes carry original issue discounts, short maturities, default interest rates up to 18%, and potential conversion or repayment provisions. Additional equity financing could significantly dilute existing shareholders.
- NextNRG transaction: The proposed exchange contemplates up to 100 million EZFL shares for NextNRG, subject to closing conditions, including Nasdaq-related requirements, authorized-share changes, and other approvals. The filing describes potential substantial dilution and notes that no fairness opinion was obtained. NextNRG is described as a development-stage clean-energy and wireless-EV-charging business with limited operating history and no significant revenue or profitability to date.
- Nasdaq listing: Nasdaq notified EzFill in 2023 that it did not meet the $2.5 million stockholders’ equity requirement. After an extension, the company received a delisting determination on February 21, 2024 and requested a hearing scheduled for May 2, 2024. The filing provides no assurance that the company will regain compliance.
- Operating and market risks: Key exposures include volatile fuel prices and margins, competition, customer concentration and cancelable customer arrangements, dependence on a small number of fuel vendors, hazardous-material and environmental liabilities, and evolving mobile-fueling regulation. Two customers represented 34.3% of 2023 sales; one customer represented 46.6% of year-end receivables. Three vendors represented 99.3% of purchases.
- Other unusual matters: The company disputes Fuel Butler’s purported termination of a technology license and has proposed ending its use of the technology. That license was fully impaired by the end of 2022. The filing reports no quantified revenue, earnings, or cash-flow guidance.
Important facts for investors to verify
- Confirm the correct issuer: the supplied filing is EzFill Holdings, Inc. (EZFL), not NextNRG, Inc.; verify the current status and final terms of the proposed acquisition.
- Reconcile the stated 39% gallon growth with the reported annual volumes, which indicate roughly 63% growth.
- Review current cash availability, subsequent financing, debt maturities and amendments, related-party terms, and the company’s ability to fund operations.
- Check the outcome of the Nasdaq appeal and whether listing and stockholders’ equity requirements have been met.
- Assess the proposed 100-million-share exchange, milestone vesting, potential dilution, related-party conflicts, and the financial condition and operating progress of NextNRG.