CEA Industries Inc. Files 10-Q for Period Ending March 31, 2024

TL;DR

<b>CEA Industries Inc. (CEAD) filed its Q1 2024 10-Q, detailing financial data and customer concentration risks.</b>

AI Summary

CEA Industries Inc. (BNCWW) filed a Quarterly Report (10-Q) with the SEC on May 14, 2024. CEA Industries Inc. filed a 10-Q report for the period ending March 31, 2024. The company was formerly known as Surna Inc. and changed its name on January 28, 2010. The filing includes data related to common stock, warrants, and Series B preferred stock. Information on director and staff compensation is also part of the filing. Customer concentration risk for sales revenue and accounts receivable is detailed for specific customers.

Why It Matters

For investors and stakeholders tracking CEA Industries Inc., this filing contains several important signals. This 10-Q provides investors with the latest quarterly financial performance and operational details of CEA Industries Inc. Understanding customer concentration risk is crucial for assessing potential revenue volatility and dependency on key clients.

Risk Assessment

Risk Level: — CEA Industries Inc. shows moderate risk based on this filing. The company's financial health and future prospects are subject to risks related to customer concentration, as detailed in the filing, which could lead to significant revenue fluctuations if key customers reduce their business.

Analyst Insight

Investors should review the detailed customer concentration risk section to understand potential impacts on revenue and profitability.

Key Numbers

• 2024-03-31 — Period End Date (Conformed period of report)
• 2024-05-14 — Filing Date (Filed as of date)
• 2023-03-31 — Prior Year Period End (Comparison period)

Key Players & Entities

• CEA Industries Inc. (company) — Filer
• Surna Inc. (company) — Former company name
• 2024-03-31 (date) — Conformed period of report
• 2024-05-14 (date) — Filed as of date
• Boulder, CO (location) — Business address

FAQ

Risk Factors

• Customer Concentration Risk [high — financial]: The company's revenue and accounts receivable are concentrated with a few customers, posing a risk to financial stability if these relationships change.

Industry Context

CEA Industries Inc. operates in the agriculture services sector, focusing on providing solutions for controlled environment agriculture.

Regulatory Implications

The filing is made under the Securities Exchange Act of 1934, requiring public companies to disclose financial and operational information quarterly.

What Investors Should Do

1. Analyze the specific revenue and accounts receivable figures related to key customers mentioned in the filing.
2. Compare the current quarter's financial data with the same period in the prior year to identify trends.
3. Review any disclosed executive compensation details for insights into management incentives.

Key Dates

• 2024-03-31: Quarterly Period End — End of the reporting period for the 10-Q filing.
• 2024-05-14: Filing Date — Date the 10-Q was officially submitted to the SEC.

Glossary

10-Q

A quarterly report required by the U.S. Securities and Exchange Commission (SEC). (Provides investors with a timely update on the company's financial condition between annual reports.)

Year-Over-Year Comparison

This filing represents the first quarterly report for the fiscal year 2024, providing updated financial information compared to the previous year's filings.

Key Financial Figures

• $0.00001 — nge on which registered Common Stock, $0.00001 par value CEAD Nasdaq Capital Mark

Filing Documents

• form10-q.htm (10-Q) — 927KB
• ex31-1.htm (EX-31.1) — 13KB
• ex31-2.htm (EX-31.2) — 13KB
• ex32-1.htm (EX-32.1) — 7KB
• ex32-2.htm (EX-32.2) — 8KB
• 0001493152-24-019229.txt (&nbsp;) — 5718KB
• cead-20240331.xsd (EX-101.SCH) — 45KB
• cead-20240331_cal.xml (EX-101.CAL) — 50KB
• cead-20240331_def.xml (EX-101.DEF) — 203KB
• cead-20240331_lab.xml (EX-101.LAB) — 369KB
• cead-20240331_pre.xml (EX-101.PRE) — 294KB
• form10-q_htm.xml (XML) — 988KB

— FINANCIAL INFORMATION

PART I — FINANCIAL INFORMATION

Financial Statements (Unaudited)

Item 1. Financial Statements (Unaudited) Condensed Consolidated Balance Sheets as of March 31, 2024 and December 31, 2023 1 Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2024 and March 31, 2023 2 Condensed Consolidated Statements of Changes in Shareholders' Equity for the Three Months Ended March 31, 2024 and March 31, 2023 3 Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2024 and March 31, 2023 4 Notes to the Condensed Consolidated Financial Statements 5

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 22

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 29

Controls and Procedures

Item 4. Controls and Procedures 29

— OTHER INFORMATION

PART II — OTHER INFORMATION

Legal Proceedings

Item 1. Legal Proceedings 30

Risk Factors

Item 1A. Risk Factors 30

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 30

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 30

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 30

Other Information

Item 5. Other Information 30

Exhibits

Item 6. Exhibits 3 1

SIGNATURES

SIGNATURES 32 EXHIBIT INDEX 33 i In this Quarterly Report on Form 10-Q, unless otherwise indicated, the "Company", "we", "us" or "our" refer to CEA Industries Inc. and, where appropriate, its wholly owned subsidiary. CAUTIONARY This Quarterly Report on Form 10-Q, including "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Item 2, contains forward-looking statements that involve substantial risks and uncertainties. These forward-looking statements are not historical fact but are based on current management expectations that involve substantial risks, uncertainties, and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed in, or implied by, these forward-looking statements. Forward-looking statements relate to future events or our future financial performance. We generally identify forward-looking statements by terminology such as "may," "will," "should," "expects," "plans," "anticipates," "could," "intends," "target," "projects," "contemplates," "believes," "estimates," "predicts," "potential," or "continue" or the negative of these terms or other similar words. All statements, other than statements of historical fact, are statements that could be deemed forward-looking statements including, but not limited to, any projections of revenue, gross profit, earnings or loss, tax provisions, cash flows or other financial items; any statements of the plans, strategies or objectives of management for future operations; any statements regarding current or future macroeconomic or industry-specific trends or events and the impact of those trends and events on us or our financial performance; any statements regarding pending investigations, legal claims or tax disputes; any statements of expectation or belief; and any statements of assumptions underlying any of the foregoing. These forward-looking statements are subject

Financial Statements

Financial Statements The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Pursuant to these rules and regulations, certain information and note disclosures, normally included in financial statements prepared in accordance with GAAP, have been condensed or omitted. In the opinion of management, all adjustments (consisting of normal recurring items) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2024 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2024. The balance sheet information as of December 31, 2023 has been derived from the audited financial statements at that date but does not include all the information and footnotes required by GAAP for complete financial statements. For further information, refer to the consolidated financial statements and notes thereto contained in the Annual Report on Form 10-K for the year ended December 31, 2023. Liquidity The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business within one year after the date the consolidated financial statements are available to be issued. The Company continues to experience recurring losses since its inception. As a result, in order to continue as a going concern, the Company has been reliant on the ability to obtain additional sources of financing to fund growth. On February 15, 2022, the Company received approximately $ 21,711,000 in net proceeds from completion of an equity offering. Based on management's evaluation, the proceeds from the Offering will be

View Full Filing

View this 10-Q filing on SEC EDGAR