May 6, 2023
5 Things to Know: Week Ending May 6
Time is running out for Energy Focus, but they have a plan. Plus, an unusual look inside Philips Hue.
Here's a roundup of some of the week's happenings curated to help lighting people stay informed.
1. That’s one way to gain Nasdaq compliance
Energy Focus, a company listed on Nasdaq Capital Market, needs to raise the per-share trading price of its common stock to maintain its listing on the market. The company received notifications on August 23, 2022, and November 16, 2022, for not meeting the minimum bid price rule and minimum stockholders' equity requirement, respectively. It was given an extension until May 15, 2023, to regain compliance with the Stockholders' Equity Requirement, but on February 21, 2023, the company was ineligible to obtain a second 180-calendar day period to regain compliance due to not meeting the Stockholders' Equity Requirement. The company has submitted an appeal to the Nasdaq Hearings Panel.
Common stock of Energy Focus hasn’t closed above the Nasdaq-required $1.00 price since July 2022. With shares now trading at $0.47, the company is running out of time to drive stock price higher with performance that pleases investors, so they are taking a different approach to maintain compliance; a proposed reverse stock split.
Energy Focus has proposed a reverse stock split that would cause the ratio at which shares of common stock will be reclassified. The ratio could range from 1-for-2 up to 1-for-10 and may be implemented up to six months after obtaining stockholder approval. Shareholders will vote on the proposal at an upcoming general meeting.
2. A new high water mark for WESCO
WESCO International has set a new record with its recently reported first quarter sales. The company's Q1 sales, gross margin, operating profit, and earnings per diluted share have all increased year-over-year. The Q1 sales reached $5.5 billion, with organic sales growing by 11%.
The gross margin stood at 21.9%, up 60 basis points, while the adjusted EBITDA margin was 7.6%, up 20 basis points year-over-year. The operating profit was $346 million, with an operating margin of 6.3%.
Wesco International's CEO, John Engel, attributed the results to the company's increased scale, expanded portfolio of products, and continued execution of its cross-selling and margin improvement programs. The company is confident in its ability to generate mid-to-high-single-digit sales growth and generate approximately $600 to $800 million in free cash flow in 2023 to support its growth initiatives and capital allocation priorities.
3. Dissecting a Philips Hue Light Bulb
“Alexa, all lights magenta.” Did you ever wonder what’s really happening inside that smart light bulb when it obediently follows your commands to change color or intensity? At the inside.lighting world headquarters offices we have over 20 Philips Hue light bulbs and were delighted by this breakdown of how things work inside. It’s the lighting version of high school biology lab when we dissected a frog – except without all the odorous formaldehyde.
We loved this video.
4. Green Marketing
The Federal Trade Commission will host a workshop on May 23, 2023 to examine “recyclable” advertising claims as part of its recently announced review of the Guides for the Use of Environmental Marketing Claims, commonly known as the Green Guides. The workshop, Talking Trash at the FTC: Recyclable Claims and the Green Guides, is free and open to the public, and pre-registration is not required.
The Commission’s Green Guides help marketers avoid making environmental marketing claims that are deceptive under Section 5 of the FTC Act. The FTC is currently reviewing the guides to determine whether updates are necessary.
5. New Construction Employment Numbers
The construction industry added 15,000 jobs on net in April, according to an Associated Builders and Contractors analysis of data released on Friday by the U.S. Bureau of Labor Statistics. On a year-over-year basis, industry employment expanded by 205,000 jobs, an increase of 2.7%.
Nonresidential construction employment rose by 800 positions on net, with growth in only one of the three subcategories. Nonresidential specialty trade contractors added 10,700 positions. The number of heavy and civil engineering jobs decreased by 8,100, while nonresidential building lost 1,800 jobs on net.
The construction unemployment rate dropped to 4.1% in April. Unemployment across all industries decreased to 3.4%.
