Company History and Overview
Beam Global, formerly known as Envision Solar International, Inc., was founded in 2006 in San Diego, California. The company initially focused on developing and manufacturing solar-powered products for commercial, residential, and municipal customers. In its early years, Beam Global faced significant challenges as it worked to establish its brand and gain traction in the market. The company struggled with profitability and had to raise additional capital through equity and debt financing to fund its operations. Despite these obstacles, Beam Global persevered and continued to innovate, developing new solar-powered products and solutions.
In 2019, the company underwent a strategic shift, changing its name to Beam Global and pivoting its focus to the electric vehicle (EV) charging infrastructure market. This move was prompted by the growing demand for sustainable transportation solutions and the company's recognition of the need for rapidly deployable, renewably-powered EV charging stations. This transition proved to be a pivotal moment in the company's history, leading to significant growth in the following years.
Over the past several years, Beam Global has expanded its product portfolio, introducing innovative solutions such as the BeamSpot™ curbside EV charger, the BeamBike™ e-bike charging station, and the BeamWell™ water desalination and delivery system. These products have further diversified the company's offerings and opened up new market opportunities both domestically and internationally.
Financial Performance
Beam Global's financial performance has been marked by significant growth in recent years. In 2020, the company reported revenue of $6.2 million, which grew to $22.0 million in 2022 and $67.4 million in 2023, representing a remarkable five-year compound annual growth rate (CAGR) of over 70%.
While the company has experienced some lumpiness in its quarterly results due to the timing of large orders, Beam Global's overall financial trajectory has been positive. The company's gross margins have improved, rising from -11.4% in 2020 to 1.8% in 2022 and 1.8% in 2023, as the company has implemented cost reduction measures and benefited from operational efficiencies.
For the most recent fiscal year, Beam Global reported annual revenue of $67.35 million, with a net loss of $16.06 million. The company's annual operating cash flow was -$13.31 million, and its annual free cash flow was -$14.36 million.
In the third quarter of 2024, Beam Global reported revenue of $11.48 million, representing a 30% decrease from $16.49 million in Q3 2023. This decrease was primarily attributed to a slowdown in orders from federal customers, which the company believes is temporary due to uncertainty around the new U.S. administration's policies on electric vehicles. However, revenues from commercial customers increased by 80% year-over-year and represented 47.9% of total Q3 2024 revenues.
Despite the revenue decline, Beam Global's Q3 2024 net income improved to $1.30 million, compared to a net loss of $3.63 million in Q3 2023. This improvement was largely due to a $6.1 million non-cash decrease in the fair value of contingent consideration liabilities.
For the first nine months of 2024, Beam Global reported revenues of $40.85 million, a 14% decrease compared to the same period in 2023. This decrease was attributed to order timing, uncertainty in the U.S. government's zero emission vehicle strategy, and evolving certification requirements for the company's energy storage systems. Despite the revenue decline, Beam Global's gross profit margin improved to 12% in the first nine months of 2024, up from 2% in the same period of 2023, due to cost improvements and positive margins from the acquisition of Amiga.
Liquidity
Beam Global's liquidity position remains strong, with $4.9 million in cash and cash equivalents as of the most recent quarter. The company is nearly debt-free, with a debt-to-equity ratio of 0.032. Beam Global has access to a $100 million credit facility with OCI Group, which has not been drawn upon, providing ample financial flexibility to support its growth initiatives.
The company's current ratio stands at 2.35, while its quick ratio is 1.39, indicating a healthy short-term liquidity position.
Diversification and Geographic Expansion
One of Beam Global's key strengths has been its ability to diversify its product portfolio and customer base. While the company's flagship EV ARC™ system has been a significant driver of its growth, Beam Global has successfully introduced new offerings that cater to a wider range of applications, including energy security, disaster preparedness, and smart city infrastructure.
Beam Global's product portfolio now includes the EV ARC (Electric Vehicle Autonomous Renewable Charger), a patented, rapidly deployed infrastructure product that uses integrated solar power and battery storage, and the Solar Tree DCFC, a patented off-grid, renewably energized and rapidly deployed single-column mounted smart generation and energy storage system capable of providing 150kW DC fast charging. The company also offers the EV ARC DCFC, a DC fast charging system comprised of four interconnected EV ARC systems.
In the smart cities infrastructure segment, Beam Global offers the BeamSpot, a streetlight, EV charging, and emergency power product that uses a combination of solar, wind, grid connection, and onboard energy storage, and the BeamBike, a rapidly deployed, construction-free, solar-powered charging system based on the patented EV ARC platform.
For energy security and disaster preparedness, the company provides products such as the BeamPatrol and BeamWell, which offer off-grid, renewably energized solutions for charging and powering critical equipment and devices in remote or disaster-affected areas.
Moreover, Beam Global has expanded its geographic footprint beyond its core U.S. market. In 2023, the company acquired Amiga DOO Kraljevo, a Serbian manufacturer of specialized steel structures and equipment, which has enabled Beam Global to establish a stronger presence in the European, Middle Eastern, and African markets. This acquisition has not only expanded the company's manufacturing and engineering capabilities but also provided access to new customer segments and distribution channels.
In the first nine months of 2024, 25% of revenues were derived from California customers, down from 28% in the same period of 2023. International sales, primarily from the company's operations in Europe, represented 20% of revenues in the first nine months of 2024, up from 8% in the prior year period.
Regulatory Challenges and Certification Requirements
Beam Global has faced some regulatory challenges in recent years, particularly with regards to the certification of its energy storage solutions. As the industry evolves, the company has had to navigate changing certification requirements, which have at times resulted in delays in the delivery of certain products.
Specifically, Beam Global has been working closely with Underwriters Laboratories (UL) to ensure that its products meet the latest safety and performance standards. While this process has temporarily impacted the company's sales, Beam Global believes that the resulting product enhancements will ultimately strengthen its competitive position and allow it to better serve its customers. The company expects the UL certification process to be completed by the end of the first quarter of 2025.
Outlook and Growth Opportunities
Looking ahead, Beam Global remains well-positioned to capitalize on the growing demand for sustainable EV infrastructure and renewable energy solutions. The company's diversified product portfolio, geographic expansion, and focus on innovation position it to address a wide range of customer needs across various markets.
The global transition towards electric mobility, coupled with increased government and corporate commitments to sustainability, presents significant growth opportunities for Beam Global. The company's proprietary technologies, such as the EV ARC™ and BeamSpot™ systems, are designed to address the challenges of deploying EV charging infrastructure, making Beam Global an attractive partner for both commercial and government entities.
Beam Global's pipeline of prospective customers is over $200 million, although the company cannot be certain when or if these prospective orders will turn into actual sales. As of November 7th, 2024, the company's backlog stood at $7 million for the USA and an additional $3.6 million for Europe, totaling $10.6 million.
The company is pursuing strategies to diversify its revenue sources, including geographic expansion, new product offerings, and a focus on corporate as well as government sales. Beam Global is also working to expand its sales channels by adding distributors, resellers, and agents, which they expect will help reach a larger audience of potential customers.
Moreover, Beam Global's recent acquisition of Telcom, a Serbian manufacturer of power electronics and telecommunications equipment, is expected to further strengthen the company's capabilities in product development and manufacturing, ultimately enhancing its competitiveness and profitability.
Conclusion
Beam Global has emerged as a leader in the sustainable EV infrastructure and renewable energy solutions market, driven by its innovative product portfolio, geographic expansion, and focus on operational excellence. While the company has faced some regulatory challenges and recent revenue declines, its strong financial position, diversified business model, and growth prospects position it well for continued success in the years ahead.
As the global transition towards electrification and sustainability gains momentum, Beam Global's unique offering and strategic positioning make it a compelling investment opportunity for investors seeking exposure to this rapidly evolving market. With a focus on expanding its product line, improving operational efficiencies, and penetrating new markets, Beam Global is well-positioned to capitalize on the growing demand for sustainable energy solutions in the coming years.