The merger in March of Ecoark Inc. of Rogers with Magnolia Solar Corp. of Woburn, Massachusetts, resulted in a new name on the roster of publicly traded companies in Arkansas: Ecoark Holdings Inc. of Rogers.
Ecoark Holdings is no Wal-Mart or Tyson Foods, of course. Magnolia Solar, which had been publicly traded since 2009, lost $566,000 in 2015 on revenue of $160,000. Ecoark Inc. was privately owned, but a proxy statement filed in March ahead of the merger revealed that it lost almost $10.5 million last year on revenue of $7.8 million.
Ecoark Holdings has submitted an application to be listed on the Nasdaq Capital Market, which Chairman and CEO Randy May said would provide the company more visibility and make its stock available to more investors.
The combined company has 97 employees and provides its clients with environmentally friendly technologies and services through four subsidiaries:
♦ Magnolia Solar Inc., with locations in Massachusetts and New York, which uses nanotechnology to increase the efficiency of existing solar panels.
♦ Intelleflex of San Jose, California, which has a regional office in Rogers. It markets a cloud-based data collection platform designed to protect food quality by offering predictive analytics and real-time feedback as products are transported.
♦ Eco3d of Phoenix, which provides plans that show current conditions and creates accurate two-dimensional and three-dimensional documentation.
♦ Pioneer Products of Rogers, which makes new products from retailers’ waste, including recycled resin trash cans sold at Walmart. Ecoark Holdings recently acquired Sable Polymer Solutions of Acworth, Georgia, and merged it into Pioneer Products.
“In 2013, Ecoark acquired Intelleflex, and since that time the company has invested significantly in research and development to build out the only end-to-end solution for the cold chain. This R&D resulted in an expansion of the company’s IP portfolio to over 60 patents in the US. This technology is now ready for deployment at the retail level,” May told Arkansas Business in an email.
The merger of Ecoark and Magnolia Solar was first announced in January, approved by stockholders on March 18 and closed on March 24. A 1-for-250 reverse split of Magnolia Solar stock resulted in shares that were trading at about $21 last week.
For the quarter that ended March 31, the new Ecoark Holdings reported revenue of $1.96 million compared with $2.22 million for the same period last year. The company attributed the dip in sales to lower shipments of recycled plastic trash cans by Pioneer caused by a difference in the timing of shipments at the end of 2015 versus 2014.
The bottom line for the quarter was a net loss of $2.22 million or 8 cents per share. Magnolia Solar lost nearly $3 million, or 13 cents per share, in the same quarter of 2015, and Ecoark attributed the improvement to cost control.
In the quarterly filing, Ecoark Holdings said that it had experienced “typical start-up costs and losses in operations.”
The company said in the document that its ability to raise additional capital is unknown, and significant additional capital, according to the proxy, is on the wish list.
Investors owning more than 5 percent of Ecoark Holdings, according to a July 6 SEC filing, are May, the chairman and CEO; Yash Puri, the chief financial officer; and directors Greg Landis, Gary Metzger, John Cahill, Terrence Matthews and Charles Rateliff.
In a news release announcing completion of the Ecoark-Magnolia Solar merger that birthed Ecoark Holdings, May called the deal an “important milestone,” and credited Magnolia Solar and its CEO, Ashok Sood, with helping the company reach an interim goal.
“When we founded Ecoark in 2011, we set a lofty goal of becoming a publicly traded company within five years. Dr. Sood, and the team at Magnolia Solar made this goal a reality. As the merger-related activities are now behind us, we look forward to working with Dr. Sood and his team as we continue to address the significant, unmet opportunities in sustainability through our intelligent technologies.”
Sood is now president of Ecoark.