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Friday, January 27, 2023

Cemtrex Inc (NASDAQ: CETX) Steady Rise Northbound as Co Completes Major Restructuring and Reports Record $50.3 Million in Revenues for Fiscal 2022

Cemtrex Inc (NASDAQ: CETX) has been making a steady run northbound since reversing off $0.09 lows back in December. This comes after nearly 2 years of steady declines since CETX spiked over $4 per share back in early 2021 driven by fear of delisting or RS although neither of these has materialized yet. Now that CETX has reversed northbound off new 52-week lows CETX is under heavy accumulation and continues to move higher averaging just over $100,000 in dollar volume per day. A low float runner, CETX has about 23.4 million shares in the public float and is now cheaper than it has ever been in the Company’s history with a significant gap to fill from current levels. The Company’s 10% Preferred trade under the ticker symbol CETXP.  

CETX continues to report record revenues recently reporting revenues of $50.3 million for the full year of 2022, compared to revenue of $43.1 million in 2021, a 17% increase year over year. Cemtrex also recently completed a major restructuring of its business and divestment of non-core assets, expected to result in cost savings of $6.2M resulting in significantly better financial results moving into 2023. Cemtex CEO Saagar Govil really sees the Company taking off this year recently stating he expects Vicon revenues will increase by 16% to $28 million and AIS revenues to grow around 3% to $21.8 million driven by continued strength in the Industrial Services market. Managements expectation is that the Cemtex will reach a positive operating income in FY 2024. We will be updating on CETX when more details emerge so make sure you are subscribed to newsytrends.com by entering your email below. 

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Cemtrex Inc (NASDAQ: CETX) operating out of Brooklyn, NY is a technology company driving innovation in Internet of Things (IoT), security, machine vision & artificial intelligence, and augmented & virtual reality. Cemtrex owns two operating subsidiaries: Vicon Industries Inc and Advanced Industrial Services Inc. Over the years Cemtrex has evolved through strategic acquisitions and internal growth into a multi-industry technology company. The Company has expanded in a wide range of sectors, including smart technologies, virtual and augmented realities, industrial solutions, and intelligent security systems. Cemtrex has developed proprietary technologies that give it an edge in competing with its competitors and currently has multiple patents and patent claims that it owns.

Vicon Industries, a subsidiary of Cemtrex Inc., is a global leader in advanced security and surveillance technology to safeguard businesses, schools, municipalities, hospitals and cities. Since 1967, Vicon delivers mission-critical security surveillance systems, specializing in engineering complete security solutions that simplify deployment, operation and ongoing maintenance. Vicon provides security solutions for some of the largest municipalities and businesses in the U.S. and around the world, offering a wide range of cutting-edge and compliant security technologies, from AI-driven video analytics to fully integrated access control solutions. Management believes Vicon is on a strong path towards $5-10 million of recurring revenue in the next three to five years as the industry shifts to SaaS solutions leveraging AI and cloud technology solutions. The Company recently appointed Shane Compton as Chief Operating Officer. 

AIS – Advanced Industrial Services, a subsidiary of Cemtrex, Inc., is a premier provider of industrial contracting services including millwrighting, rigging, piping, electrical, welding. AIS Installs high precision equipment in a wide variety of industrial markets including automotive, printing & graphics, industrial automation, packaging, and chemicals. AIS owns and operates a modern fleet of custom designed specialty equipment to assure safe and quick installation of your production equipment. Fiscal 2022 revenue for AIS, grew 12% on rising demand for its industrial contracting services. Management believes AIS has significant potential for expansion, particularly with bolt on acquisitions.

In November Cemtrex undertook a transformative restructuring in which it divested its Smartdesk and VR subsidiaries in order to focus exclusively on its Vicon Industries and Advanced Industrial Services (AIS) businesses. The restructuring is the culmination of Cemtrex’s previously announced strategic shift towards prioritizing its core businesses. More recently Cemtrex Identified another $1M in corporate overhead from legal, accounting, and development expenses that were incurred in FY 2022 that will not be incurred in FY 2023. This will result in approximately $6.2M in operating expense reduction to be realized going forward from Nov 2022.

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CETX

On December 28 CETX reported its financial and operational results for the fourth quarter and fiscal year ended September 30, 2022. Revenue for the full year of 2022 totaled $50.3 million, compared to revenue of $43.1 million for the full year of 2021, a 17% increase year over year. The increase in revenue for the year was due to increased demand for the Company’s products and services. Net loss for the full year of 2022 was $13 million, as compared to a net loss of $7.8 million in 2021. Cash and cash equivalents totaled $10.6 million at September 30, 2022. 

Cemtrex Chairman and CEO, Saagar Govil, commented on the results: “2022 was a transformative year for Cemtrex, marked by our decision to undertake a significant restructuring in which we divested the Smartdesk and VR subsidiaries to focus exclusively on our Vicon Industries and Advanced Industrial Services (AIS) businesses. We continue to see escalating demand for these businesses and believe this shift in focus to capture significant near-term opportunities will help us to reach positive operating income by 2024 and maximize shareholder value over the next several years. 

Mr. Govil see Cemtrex business taking off in 2023 recently saying on the Company: “Looking ahead, we believe revenues for Vicon Industries, based on our current demand, should increase by approximately 16% to $28.0 million for fiscal year 2023 given the launch of its AI based analytics solution, improvements to Valerus and additional sales. We also believe AIS will continue to expand revenues by 3% to $21.8 million driven by continued strength in the Industrial Services market. With approximately $10.0 million in cash and a dramatic reduction in expenses, we believe we have sufficient capital in the near term to focus on executing on our roadmap both financially and operationally without the need for immediate capital. Our expectation is that the Company reach a positive Operating Income in FY 2024. We continue to work to position the Company on the path to a sustainable financial model and for long term growth which we believe will provide long term value for our shareholders.”  

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Currently trading at a $4.1 million market valuation CETX is a low float runner with around 23.4 million shares in the public float and is now cheaper than it has ever been in the Company’s history with a significant gap to fill from current levels. The stock just made a powerful reversal off $0.09 lows and has been moving steadily northbound since as buyers’ way outnumber sellers here. This comes after the Company recently reported record revenues of $50.3 and completed a major restructuring of its business and divestment of non-core assets, expected to result in substantial cost savings of approximately $6.2M. Now that CETX has seen a major reversal and is moving northbound with power it is quickly getting noticed by speculators who are accumulating here. CETX has seen a significant decline since early 2021 on delisting and RS fears although neither of these has materialized yet. We will be updating on CETX when more details emerge so make sure you are subscribed to newsytrends.com by entering your email below.

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Disclosure: we hold no position in CETX either long or short and we have not been compensated for this article.

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