Novo Integrated Sciences Reports Fiscal Year 2023 Second Quarter Financial Results

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Novo Integrated Sciences, Inc. (NASDAQ:NVOS) (the “Company” or “Novo”), pioneering a holistic approach to patient-first health and wellness through a multidisciplinary healthcare ecosystem of multiple patient and consumer touchpoints for services and product innovation, today reported its financial results for the fiscal quarter ended February 28, 2023.

Robert Mattacchione, Novo’s CEO and Board Chairman, stated, “During the fiscal year 2023 second quarter period, the Company paid a total of $9,086,050 to certain note holders upon conversion of their notes. Additionally, the Company announced the signing of agreements for an unsecured, non-dilutive 15-year debt instrument, with a principal sum of $70,000,000, which provides for the Company to receive net proceeds of approximately $55,000,000 after fees. In today’s environment of tight capital markets and expensive capital raises, this cash infusion is consequential and will provide the Company with the foundational capital and repayment terms required to support and accelerate the further implementation and growth of Novo’s three-pillar business model.”

Financial Highlights for the three month period ended February 28, 2023:

  • Cash and cash equivalents were $609,738, total assets were $36.5 million, total liabilities were $9.5 million, and stockholders’ equity was $27.2 million.
  • Revenues were $2,556,509, representing a decrease of $312,714, or 11%, from $2,869,223 for the same period in 2022. The decrease in revenue is principally due to the decrease in outsourced product sales and IoNovo Iodine. Acenzia’s and Terragenx’s revenue for the three months ended February 28, 2023 was $458,920 and $32,167, respectively. Revenue from our healthcare services increased by 9% when comparing the revenue for the three months ended February 28, 2022.
  • Operating costs were $2,757,713, representing a decrease of $579,317, or 17%, from $3,337,030 for the same period in 2022. The decrease in operating costs is principally due to the decrease in overhead expenses and depreciation and amortization.
  • Net loss attributed to Novo Integrated Sciences, Inc. for the three months ended February 28, 2023 was $4,621,355, representing a decrease of $183,812, or 4%, from $4,805,167 for the same period in 2022. The decrease in net loss is principally due to the decrease in operating expenses.
  • On February 23, 2023, the Company issued a $573,000 promissory note (12% per annum interest rate) and completed the related Securities Purchase Agreement with Mast Hill Fund, L.P. for gross proceeds of $515,700. The Company granted 5-year warrants with an exercise price of $0.25 per share and issued 955,000 restricted shares to Mast Hill Fund, L.P.
  • On April 26, 2023, the Company entered into a securities purchase agreement with RC Consulting Group LLC in favor of SCP Tourbillion Monaco or registered assigns pursuant to which the Company issued an unsecured 15-year promissory note to the RC Noteholder (the “RC Note”) with a maturity date of April 26, 2038, in the principal sum of $70,000,000, which amount represents the $57,000,000 purchase price plus a yield (non-compounding) of 1.52% (zero coupon) per annum from April 26, 2023 until the same becomes due and payable as provided in the RC Note.

About Novo Integrated Sciences, Inc.

Novo Integrated Sciences, Inc. is pioneering a holistic approach to patient-first health and wellness through a multidisciplinary healthcare ecosystem of services and product innovation. Novo offers an essential and differentiated solution to deliver, or intend to deliver, these services and products through the integration of medical technology, advanced therapeutics, and rehabilitative science.

We believe that “decentralizing” healthcare, through the integration of medical technology and interconnectivity, is an essential solution to the rapidly evolving fundamental transformation of how non-catastrophic healthcare is delivered both now and in the future. Specific to non-critical care, ongoing advancements in both medical technology and inter-connectivity are allowing for a shift of the patient/practitioner relationship to the patient’s home and away from on-site visits to primary medical centers with mass-services. This acceleration of “ease-of-access” in the patient/practitioner interaction for non-critical care diagnosis and subsequent treatment minimizes the degradation of non-critical health conditions to critical conditions as well as allowing for more cost-effective healthcare distribution.

The Company’s decentralized healthcare business model is centered on three primary pillars to best support the transformation of non-catastrophic healthcare delivery to patients and consumers:

  • First Pillar: Service Networks. Deliver multidisciplinary primary care services through (i) an affiliate network of clinic facilities, (ii) small and micro footprint sized clinic facilities primarily located within the footprint of box-store commercial enterprises, (iii) clinic facilities operated through a franchise relationship with the Company, and (iv) corporate operated clinic facilities.
  • Second Pillar: Technology. Develop, deploy, and integrate sophisticated interconnected technology, interfacing the patient to the healthcare practitioner thus expanding the reach and availability of the Company’s services, beyond the traditional clinic location, to geographic areas not readily providing advanced, peripheral based healthcare services, including the patient’s home.
  • Third Pillar: Products. Develop and distribute effective, personalized health and wellness product solutions allowing for the customization of patient preventative care remedies and ultimately a healthier population. The Company’s science-first approach to product innovation further emphasizes our mandate to create and provide over-the-counter preventative and maintenance care solutions.

Innovation through science combined with the integration of sophisticated, secure technology assures Novo Integrated Sciences of continued cutting-edge advancement in patient-first platforms.

For more information concerning Novo Integrated Sciences, please visit www.novointegrated.com.

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Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts included in this press release are forward-looking statements. In some cases, forward-looking statements can be identified by words such as "believe," “intend,” "expect," "anticipate," "plan," "potential," "continue" or similar expressions. Such forward-looking statements include risks and uncertainties, and there are important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors, risks and uncertainties are discussed in Novo’s filings with the Securities and Exchange Commission. Investors should not place any undue reliance on forward-looking statements since they involve known and unknown, uncertainties and other factors which are, in some cases, beyond Novo’s control which could, and likely will, materially affect actual results, levels of activity, performance or achievements. Any forward-looking statement reflects Novo’s current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to operations, results of operations, growth strategy and liquidity. Novo assumes no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. The contents of any website referenced in this press release are not incorporated by reference herein.

 

NOVO INTEGRATED SCIENCES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

As of February 28, 2023 (unaudited) and August 31, 2022

 

 

 

February 28,

 

August 31,

 

 

2023

 

2022

 

 

 

(unaudited)

 

 

 

ASSETS

 

 

 

 

 

 

Current Assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

609,738

 

 

$

2,178,687

 

Accounts receivable, net

 

 

923,556

 

 

 

1,017,405

 

Inventory, net

 

 

925,107

 

 

 

879,033

 

Other receivables

 

 

1,045,619

 

 

 

1,085,335

 

Prepaid expenses and other current assets

 

 

546,604

 

 

 

571,335

 

Total current assets

 

 

4,050,624

 

 

 

5,731,795

 

 

 

 

 

 

 

 

Property and equipment, net

 

 

5,449,163

 

 

 

5,800,648

 

Intangible assets, net

 

 

17,199,620

 

 

 

18,840,619

 

Right-of-use assets, net

 

 

2,250,442

 

 

 

2,673,934

 

Goodwill

 

 

7,539,469

 

 

 

7,825,844

 

TOTAL ASSETS

 

$

36,489,318

 

 

$

40,872,840

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

Current Liabilities:

 

 

 

 

 

 

Accounts payable

 

$

2,040,073

 

 

$

1,800,268

 

Accrued expenses

 

 

1,222,832

 

 

 

1,116,125

 

Accrued interest (including amounts to related parties)

 

 

469,308

 

 

 

454,189

 

Government loans and notes payable, current portion

 

 

92,050

 

 

 

-

 

Convertible notes payable, net of discount of $307,623

 

 

421,489

 

 

 

9,099,654

 

Contingent liability

 

 

62,388

 

 

 

534,595

 

Due to related parties

 

 

468,749

 

 

 

478,897

 

Debentures, related parties, current portion

 

 

911,623

 

 

 

-

 

Finance lease liability, current portion

 

 

15,938

 

 

 

8,890

 

Operating lease liability, current portion

 

 

473,628

 

 

 

582,088

 

Total current liabilities

 

 

6,178,078

 

 

 

14,074,706

 

 

 

 

 

 

 

 

Debentures, related parties, net of current portion

 

 

-

 

 

 

946,250

 

Government loans and notes payable, net of current portion

 

 

64,977

 

 

 

161,460

 

Finance lease liability, net of current portion

 

 

-

 

 

 

12,076

 

Operating lease liability, net of current portion

 

 

1,890,624

 

 

 

2,185,329

 

Deferred tax liability

 

 

1,392,553

 

 

 

1,445,448

 

TOTAL LIABILITIES

 

 

9,526,232

 

 

 

18,825,269

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

Novo Integrated Sciences, Inc.

 

 

 

 

 

 

Convertible preferred stock; $0.001 par value; 1,000,000 shares authorized; 0 and 0 shares issued and outstanding at February 28, 2023 and August 31, 2022, respectively

 

 

-

 

 

 

-

 

Common stock; $0.001 par value; 499,000,000 shares authorized; 139,626,576 and 31,180,603 shares issued and outstanding at February 28, 2023 and August 31, 2022, respectively

 

 

139,626

 

 

 

31,181

 

Additional paid-in capital

 

 

88,320,971

 

 

 

66,056,824

 

Common stock to be issued (911,392 and 4,149,633 shares at February 28, 2023 and August 31, 2022)

 

 

1,217,293

 

 

 

9,474,807

 

Other comprehensive (loss) income

 

 

(51,993

)

 

 

560,836

 

Accumulated deficit

 

 

(62,375,257

)

 

 

(53,818,489

)

Total Novo Integrated Sciences, Inc. stockholders’ equity

 

 

27,250,640

 

 

 

22,305,159

 

Noncontrolling interest

 

 

(287,554

)

 

 

(257,588

)

Total stockholders’ equity

 

 

26,963,086

 

 

 

22,047,571

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

 

$

36,489,318

 

 

$

40,872,840

 

 

NOVO INTEGRATED SCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

For the Three and Six Months Ended February 28, 2023 and 2022 (unaudited)

 

 

 

Three Months Ended

 

Six Months Ended

 

 

February 28,

 

February 28,

 

February 28,

 

February 28,

 

 

2023

 

2022

 

2023

 

2022

 

 

(unaudited)

 

(unaudited)

 

(unaudited)

 

(unaudited)

 

 

 

 

 

 

 

 

 

Revenues

 

$

2,556,509

 

 

$

2,869,223

 

 

$

5,975,789

 

 

$

6,031,150

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenues

 

 

1,585,606

 

 

 

1,652,869

 

 

 

3,265,353

 

 

 

3,548,330

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit

 

 

970,903

 

 

 

1,216,354

 

 

 

2,710,436

 

 

 

2,482,820

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Selling expenses

 

 

707

 

 

 

26,370

 

 

 

8,039

 

 

 

26,538

 

General and administrative expenses

 

 

2,757,006

 

 

 

3,310,660

 

 

 

6,731,167

 

 

 

5,940,617

 

Total operating expenses

 

 

2,757,713

 

 

 

3,337,030

 

 

 

6,739,206

 

 

 

5,967,155

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss from operations

 

 

(1,786,810

)

 

 

(2,120,676

)

 

 

(4,028,770

)

 

 

(3,484,335

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-operating income (expense)

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

2,243

 

 

 

8,490

 

 

 

4,524

 

 

 

16,878

 

Interest expense

 

 

(123,866

)

 

 

(1,226,182

)

 

 

(291,109

)

 

 

(1,294,912

)

Amortization of debt discount

 

 

(2,740,349

)

 

 

(1,463,022

)

 

 

(4,230,862

)

 

 

(1,520,862

)

Foreign currency transaction gain (loss)

 

 

3,620

 

 

 

(66,814

)

 

 

(35,681

)

 

 

(401,368

)

Total other income (expense)

 

 

(2,858,352

)

 

 

(2,747,528

)

 

 

(4,553,128

)

 

 

(3,200,264

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss before income taxes

 

 

(4,645,162

)

 

 

(4,868,204

)

 

 

(8,581,898

)

 

 

(6,684,599

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax expense

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(4,645,162

)

 

$

(4,868,204

)

 

$

(8,581,898

)

 

$

(6,684,599

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss attributed to noncontrolling interest

 

 

(23,807

)

 

 

(63,037

)

 

 

(25,130

)

 

 

(72,845

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss attributed to Novo Integrated Sciences, Inc.

 

 

(4,621,355

)

 

$

(4,805,167

)

 

 

(8,556,768

)

 

$

(6,611,754

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive loss:

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

 

(4,645,162

)

 

 

(4,868,204

)

 

 

(8,581,898

)

 

 

(6,684,599

)

Foreign currency translation (loss) gain

 

 

(196,683

)

 

 

115,093

 

 

 

(617,665

)

 

 

10,705

 

Comprehensive loss:

 

$

(4,841,845

)

 

$

(4,753,111

)

 

$

(9,199,563

)

 

$

(6,673,894

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding - basic and diluted

 

 

79,334,919

 

 

 

28,740,700

 

 

 

56,469,365

 

 

 

27,827,686

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per common share - basic and diluted

 

$

(0.06

)

 

$

(0.17

)

 

$

(0.15

)

 

$

(0.24

)

 

NOVO INTEGRATED SCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

For the Three and Six Months Ended February 28, 2023 and 2022 (unaudited)

 

 

 

 

 

 

 

Additional

 

Common

 

Other

 

 

 

Novo

 

 

 

 

 

 

Common Stock

 

Paid-in

 

Stock To

 

Comprehensive

 

Accumulated

 

Stockholders’

 

Noncontrolling

 

Total

 

 

Shares

 

Amount

 

Capital

 

Be Issued

 

Income

 

Deficit

 

Equity

 

Interest

 

Equity

Balance, August 31, 2022

 

31,180,603

 

$

31,181

 

$

66,056,824

 

$

9,474,807

 

 

$

560,836

 

 

$

(53,818,489

)

 

$

22,305,159

 

 

$

(257,588

)

 

$

22,047,571

 

Units issued for cash, net of offering costs

 

4,000,000

 

 

4,000

 

 

1,791,000

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,795,000

 

 

 

-

 

 

 

1,795,000

 

Issuance of common stock to be issued

 

36,222

 

 

36

 

 

92,330

 

 

(92,366

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Cashless exercise of warrants

 

4,673,986

 

 

4,674

 

 

1,134,376

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,139,050

 

 

 

-

 

 

 

1,139,050

 

Fair value of stock options

 

-

 

 

-

 

 

60,887

 

 

-

 

 

 

-

 

 

 

-

 

 

 

60,887

 

 

 

-

 

 

 

60,887

 

Foreign currency translation loss

 

-

 

 

-

 

 

-

 

 

-

 

 

 

(417,008

)

 

 

-

 

 

 

(417,008

)

 

 

(3,974

)

 

 

(420,982

)

Net loss

 

-

 

 

-

 

 

-

 

 

-

 

 

 

-

 

 

 

(3,935,413

)

 

 

(3,935,413

)

 

 

(1,323

)

 

 

(3,936,736

)

Balance, November 30, 2022

 

39,890,811

 

$

39,891

 

$

69,135,417

 

$

9,382,441

 

 

$

143,828

 

 

$

(57,753,902

)

 

$

20,947,675

 

 

$

(262,885

)

 

$

20,684,790

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share issuance for convertible debt settlement

 

93,109,398

 

 

93,110

 

 

8,992,941

 

 

-

 

 

 

-

 

 

 

-

 

 

 

9,086,051

 

 

 

-

 

 

 

9,086,051

 

Cashless exercise of warrants

 

1,159,348

 

 

1,159

 

 

281,374

 

 

-

 

 

 

-

 

 

 

-

 

 

 

282,533

 

 

 

-

 

 

 

282,533

 

Exercise of warrants for cash

 

1,310,000

 

 

1,310

 

 

129,690

 

 

-

 

 

 

-

 

 

 

-

 

 

 

131,000

 

 

 

-

 

 

 

131,000

 

Issuance of common stock to be issued

 

3,202,019

 

 

3,201

 

 

8,161,947

 

 

(8,165,148

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Shares issued with convertible notes

 

955,000

 

 

955

 

 

82,008

 

 

-

 

 

 

-

 

 

 

-

 

 

 

82,963

 

 

 

-

 

 

 

82,963

 

Value of warrants issued with convertible notes

 

-

 

 

-

 

 

86,327

 

 

-

 

 

 

-

 

 

 

-

 

 

 

86,327

 

 

 

-

 

 

 

86,327

 

Fair value of stock options

 

-

 

 

-

 

 

60,887

 

 

-

 

 

 

-

 

 

 

-

 

 

 

60,887

 

 

 

-

 

 

 

60,887

 

Extinguishment of derivative liability due to conversion

-

 

 

-

 

 

1,390,380

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,390,380

 

 

 

-

 

 

 

1,390,380

 

Foreign currency translation loss

-

 

 

-

 

 

-

 

 

-

 

 

 

(195,821

)

 

 

-

 

 

 

(195,821

)

 

 

(862

)

 

 

(196,683

)

Net loss

-

 

 

-

 

 

-

 

 

-

 

 

 

-

(4,621,355

)

(4,621,355

)

(23,807

)

(4,645,162

)

Balance, February 28, 2023

139,626,576

 

$

139,626

 

$

88,320,971

 

$

1,217,293

 

 

$

 (51,993

)

 

$

(62,375,257

)

 

$

27,250,640

 

 

$

(287,554

)

 

$

(26,963,086

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, August 31, 2021

 

26,610,144

 

$

26,610

 

$

54,579,396

 

 

$

9,236,607

 

$

991,077

 

 

$

(20,969,274

)

 

$

43,864,416

 

 

$

(60,261

)

 

$

43,804,155

 

Common stock for services

 

35,000

 

 

35

 

 

64,715

 

 

 

-

 

 

-

 

 

 

-

 

 

 

64,750

 

 

 

-

 

 

 

64,750

 

Common stock issued as collateral and held in escrow

 

2,000,000

 

 

2,000

 

 

(2,000

)

 

 

-

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Common stock to be issued for purchase of Terragenx

 

-

 

 

-

 

 

-

 

 

 

983,925

 

 

-

 

 

 

-

 

 

 

983,925

 

 

 

97,311

 

 

 

1,081,236

 

Common stock to be issued for purchase of Mullin assets

 

-

 

 

-

 

 

-

 

 

 

188,925

 

 

-

 

 

 

-

 

 

 

188,925

 

 

 

-

 

 

 

188,925

 

Value of warrants issued with convertible notes

 

-

 

 

-

 

 

295,824

 

 

 

-

 

 

-

 

 

 

-

 

 

 

295,824

 

 

 

-

 

 

 

295,824

 

Fair value of stock options

 

-

 

 

-

 

 

154,135

 

 

 

-

 

 

-

 

 

 

-

 

 

 

154,135

 

 

 

-

 

 

 

154,135

 

Foreign currency translation loss

 

-

 

 

-

 

 

-

 

 

 

-

 

 

(103,533

)

 

 

-

 

 

 

(103,533

)

 

 

(855

)

 

 

(104,388

)

Net loss

 

-

 

 

-

 

 

-

 

 

 

-

 

 

-

 

 

 

(1,806,587

)

 

 

(1,806,587

)

 

 

(9,808

)

 

 

(1,816,395

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, November 30, 2021

 

28,645,144

 

$

28,645

 

$

55,092,070

 

 

$

10,409,457

 

$

887,544

 

 

$

(22,775,861

)

 

$

43,641,855

 

 

$

26,387

 

 

$

43,668,242

 

Common stock for services

 

240,000

 

 

240

 

 

297,760

 

 

 

-

 

 

-

 

 

 

-

 

 

 

298,000

 

 

 

-

 

 

 

298,000

 

Value of warrants issued with convertible notes

 

-

 

 

-

 

 

5,257,466

 

 

 

-

 

 

-

 

 

 

-

 

 

 

5,257,466

 

 

 

-

 

 

 

5,257,466

 

Fair value of stock options

 

-

 

 

-

 

 

44,427

 

 

 

-

 

 

-

 

 

 

-

 

 

 

44,427

 

 

 

-

 

 

 

44,427

 

Foreign currency translation gain

 

-

 

 

-

 

 

-

 

 

 

-

 

 

114,738

 

 

 

-

 

 

 

114,738

 

 

 

355

 

 

 

115,093

 

Net loss

 

-

 

 

-

 

 

-

 

 

 

-

 

 

-

 

 

 

(4,805,167

)

 

 

(4,805,167

)

 

 

(63,037

)

 

 

(4,868,204

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, February 28, 2022

 

28,885,144

 

$

28,885

 

$

60,691,723

 

 

$

10,409,457

 

$

1,002,282

 

 

$

(27,581,028

)

 

$

44,551,319

 

 

$

(36,295

)

 

$

44,515,024

 

 

NOVO INTEGRATED SCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Six Months Ended February 28, 2023 and 2022 (unaudited)

 

 

 

Six Months Ended

 

 

February 28,

 

February 28,

 

 

2023

 

2022

 

 

(unaudited)

 

(unaudited)

 

 

 

 

 

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

 

 

Net loss

 

$

(8,581,898

)

 

$

(6,684,599

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

1,138,797

 

 

 

1,467,837

 

Fair value of vested stock options

 

 

121,774

 

 

 

198,562

 

Common stock issued for services

 

 

-

 

 

 

362,750

 

Financing costs for debt extension

 

 

1,421,583

 

 

 

-

 

Operating lease expense

 

 

419,256

 

 

 

289,626

 

Amortization of debt discount

 

 

4,230,862

 

 

 

1,520,862

 

Foreign currency transaction losses

 

 

35,681

 

 

 

401,368

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

Accounts receivable

 

 

57,936

 

 

 

213,125

 

Inventory

 

 

(78,898

)

 

 

46,135

 

Prepaid expenses and other current assets

 

 

6,143

 

 

 

(285,444

)

Accounts payable

 

 

299,881

 

 

 

(422,847

)

Accrued expenses

 

 

148,918

 

 

 

(111,479

)

Accrued interest

 

 

28,226

 

 

 

277,075

 

Operating lease liability

 

 

(405,082

)

 

 

(282,703

)

Net cash used in operating activities

 

 

(1,156,821

)

 

 

(3,009,732

)

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

 

 

Purchase of property and equipment

 

 

-

 

 

 

(192,536

)

Cash acquired with acquisition

 

 

-

 

 

 

29,291

 

Net cash used in investing activities

 

 

-

 

 

 

(163,245

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

 

 

Proceeds from (repayments to) related parties

 

 

6,138

 

 

 

(4,350

)

Repayments of finance leases

 

 

(4,299

)

 

 

(10,934

)

Repayments of notes payable

 

 

-

 

 

 

(4,415,000

)

Proceeds from the sale of common stock, net of offering costs

 

 

1,795,000

 

 

 

-

 

Proceeds from exercise of warrants

 

 

131,000

 

 

 

-

 

Repayment of convertible notes

 

 

(2,977,778

)

 

 

-

 

Proceeds from issuance of convertible notes, net

 

 

445,235

 

 

 

15,270,000

 

Net cash (used in) provided by financing activities

 

 

(604,704

)

 

 

10,839,716

 

 

 

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

 

 

192,576

 

 

 

(15,904

)

 

 

 

 

 

 

 

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS

 

 

(1,568,949

)

 

 

7,650,835

 

 

 

 

 

 

 

 

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD

 

 

2,178,687

 

 

 

8,293,162

 

 

 

 

 

 

 

 

CASH AND CASH EQUIVALENTS, END OF PERIOD

 

$

609,738

 

 

$

15,943,997

 

 

 

 

 

 

 

 

CASH PAID FOR:

 

 

 

 

 

 

Interest

 

$

275,990

 

 

$

1,294,912

 

Income taxes

 

$

-

 

 

$

-

 

 

 

 

 

 

 

 

SUPPLEMENTAL NON-CASH INVESTING AND FINANCING ACTIVITIES:

 

 

 

 

 

 

Common stock issued for convertible debt settlement

 

$

9,086,051

 

 

$

-

 

Common stock to be issued for intangible assets

 

$

-

 

 

$

188,925

 

Common stock to be issued for acquisition

 

$

-

 

 

$

983,925

 

Debt discount recognized on derivative liability

 

$

1,390,380

 

 

$

-

 

Debt discount recognized on convertible note

 

$

297,055

 

 

$

-

 

Extinguishment of derivative liability due to conversion

 

$

1,390,380

 

 

$

-

 

Common stock issued with convertible notes

 

$

82,963

 

 

$

-

 

Warrants issued with convertible notes

 

$

86,327

 

 

$

-

 

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20230526005299/en/

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