Novo Integrated Sciences Reports Fiscal Year 2024 First Quarter Financial Results
BELLEVUE, Wash.–(BUSINESS WIRE)–$NVOS #AAPI–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 first fiscal quarter ended November 30, 2023.
Robert Mattacchione, Novo’s CEO and Board Chairman, stated, “The Company remains committed to the commercialization of its proprietary product offerings and the expansion and delivery of its essential services and solutions for how non-catastrophic healthcare is delivered both now and in the future. During the fiscal year 2024 first quarter period, the Company continued to work with certain prospective financial partners to close previously announced non-traditional financing opportunities for the Company’s business capital needs, including (i) an unsecured, non-dilutive 15-year debt instrument, with a principal sum of $70,000,000, which provides for net proceeds to the Company of approximately $52,000,000, after fees; (ii) the acquisition and monetization of the Ophir collection, a certain collection of 43 gemstones, 42 of which are certified by the Gemological Institute of America (the “Ophir Collection”); and (iii) a collateral transfer agreement of a One Billion Dollar gold-backed bond for the purpose and general use of monetization by Novo for a period of up to 15 years. In today’s environment of tight capital markets and expensive capital raises, these pending transactions would allow the Company access to the foundational capital and repayment terms necessary to support and accelerate the further implementation and growth of Novo’s three-pillar business model.”
Financial Highlights for the three month period ended November 30, 2023:
- Cash and cash equivalents were $1,640,007, total assets were $37,244,384, total liabilities were $13,960,336, and stockholders’ equity was $23,284,048.
- Revenues were $3,891,218, representing an increase of $471,938, or 14%, from $3,419,280 for the same period in 2022. The increase in revenue was principally due to an increase in product sales. Acenzia’s and Terragenx’s revenue for the three months ended November 30, 2023 were $1,683,850 and $16,971, respectively. Revenue from our healthcare services increased by 1.2% when comparing the revenue for the same period in 2022.
- Operating costs were $5,261,655, representing an increase of $1,280,162, or 32%, from $3,981,493 for the same period in 2022. The increase in operating costs was principally due to common stock issuance for services and cashless warrant exercise.
- Net loss attributed to the Company was $4,680,343, representing an increase of $744,930, or 19%, from $3,935,413 for the same period in 2022. The increase in net loss was principally due to the increase in operating expenses.
- On September 12, 2023, the Company issued a $3,500,000 promissory note (12% per annum interest rate) with a purchase price of $3,150,000 and completed the related Securities Purchase Agreement with Mast Hill Fund, L.P. (“Mast Hill”). No warrants or shares were issued under the terms and conditions of this transaction with Mast Hill.
- On September 18, 2023, the Company issued a $277,778 promissory note (12% per annum interest rate) with a purchase price of $250,000 and completed the related Securities Purchase Agreement with FirstFire Global Opportunities Fund, LLC (“FirstFire”). No warrants or shares were issued under the terms and conditions of this transaction with FirstFire.
- On September 21, 2023, the total principal and interest of $577,521 owed on the $573,000 FirstFire promissory note, dated March 21, 2023, was converted to 519,845 restricted shares of the Company’s common stock and paid in full.
Corporate and Operational Highlights for the three month period ended November 30, 2023:
- On November 6, 2023, the Company effectuated a 1-for-10 reverse stock split (the “Reverse Stock Split”). The Company’s common stock began trading on the Nasdaq Capital Market on a Reverse Stock Split-adjusted basis on November 7, 2023.
- On November 21, 2023, the Company entered into a Purchase and Sale Agreement (“Ophir Agreement”) between the Company and Blake Alsbrook, solely in his capacity as Court-appointed successor receiver (the “Successor Receiver”) in Ocean Thermal Energy Corporation v. C. Robert Coe II, et al., United States District Court for the Central District of California (the “Court”) Case No. 2:19-cv-04299 VAP (JPRx). Pursuant to the terms of the Ophir Agreement, the Company agreed to purchase, and the Successor Receiver agreed to sell to the Company, the Ophir Collection, subject to the contingencies outlined in the Ophir Agreement, including Court approval, which was received on December 1, 2023. All parties involved in this Ophir Agreement continue to work toward closing the transactions contemplated by the Ophir Agreement. Upon closing of the acquisition of the Ophir Collection, the Company intends to monetize the Ophir Collection.
- On November 22, 2023, the Company received notice from The Nasdaq Stock Market, LLC (“Nasdaq”) informing the Company that it had regained compliance with the minimum bid price requirement as set forth under Nasdaq Listing Rule 5550(a)(2) for continued listing on the Nasdaq Capital Market.
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.
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NOVO INTEGRATED SCIENCES, INC. |
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CONDENSED CONSOLIDATED BALANCE SHEETS |
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As of November 30, 2023 (unaudited) and August 31, 2023 |
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|
|
|
November 30, |
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August 31, |
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||
|
|
|
2023 |
|
|
2023 |
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||
|
ASSETS |
|
|
|
|
|
|
|
|
|
Current Assets: |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
1,640,007 |
|
|
$ |
416,323 |
|
|
Accounts receivable, net |
|
|
2,636,174 |
|
|
|
1,467,028 |
|
|
Inventory, net |
|
|
1,270,835 |
|
|
|
1,106,983 |
|
|
Other receivables |
|
|
1,047,742 |
|
|
|
1,051,584 |
|
|
Prepaid expenses and other current assets |
|
|
213,812 |
|
|
|
346,171 |
|
|
Total current assets |
|
|
6,808,570 |
|
|
|
4,388,089 |
|
|
|
|
|
|
|
|
|
|
|
|
Property and equipment, net |
|
|
5,306,613 |
|
|
|
5,390,038 |
|
|
Intangible assets, net |
|
|
15,704,218 |
|
|
|
16,218,539 |
|
|
Right-of-use assets, net |
|
|
1,870,204 |
|
|
|
1,983,898 |
|
|
Goodwill |
|
|
7,554,779 |
|
|
|
7,582,483 |
|
|
TOTAL ASSETS |
|
$ |
37,244,384 |
|
|
$ |
35,563,047 |
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Liabilities: |
|
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
3,403,634 |
|
|
$ |
3,513,842 |
|
|
Accrued expenses |
|
|
1,300,549 |
|
|
|
1,233,549 |
|
|
Accrued interest (including amounts to related parties) |
|
|
480,719 |
|
|
|
382,666 |
|
|
Government loans and notes payable, current portion |
|
|
93,488 |
|
|
|
277,405 |
|
|
Convertible notes payable, net of discount of $3,118,819 |
|
|
1,103,959 |
|
|
|
558,668 |
|
|
Derivative liability |
|
|
2,686,260 |
|
|
|
– |
|
|
Contingent liability |
|
|
52,749 |
|
|
|
61,767 |
|
|
Debentures, related parties |
|
|
913,474 |
|
|
|
916,824 |
|
|
Due to related parties |
|
|
458,266 |
|
|
|
533,001 |
|
|
Finance lease liability |
|
|
8,907 |
|
|
|
11,744 |
|
|
Operating lease liability, current portion |
|
|
413,506 |
|
|
|
415,392 |
|
|
Total current liabilities |
|
|
10,915,511 |
|
|
|
7,904,858 |
|
|
|
|
|
|
|
|
|
|
|
|
Government loans and notes payable, net of current portion |
|
|
63,777 |
|
|
|
65,038 |
|
|
Operating lease liability, net of current portion |
|
|
1,585,667 |
|
|
|
1,693,577 |
|
|
Deferred tax liability |
|
|
1,395,381 |
|
|
|
1,400,499 |
|
|
TOTAL LIABILITIES |
|
|
13,960,336 |
|
|
|
11,063,972 |
|
|
|
|
|
|
|
|
|
|
|
|
Commitments and contingencies |
|
|
– |
|
|
|
– |
|
|
|
|
|
|
|
|
|
|
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STOCKHOLDERS’ EQUITY |
|
|
|
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Novo Integrated Sciences, Inc. |
|
|
|
|
|
|
|
|
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Convertible preferred stock; $0.001 par value; 1,000,000 shares authorized; 0 and 0 shares issued and outstanding at November 30, 2023 and August 31, 2023, respectively |
|
|
– |
|
|
|
– |
|
|
Common stock; $0.001 par value; 499,000,000 shares authorized; 17,291,192 and 15,759,325 shares issued and outstanding at November 30, 2023 and August 31, 2023, respectively |
|
|
17,292 |
|
|
|
15,760 |
|
|
Additional paid-in capital |
|
|
95,481,354 |
|
|
|
90,973,316 |
|
|
Common stock to be issued (17,375 and 91,138 shares at November 30, 2023 and August 31, 2023) |
|
|
44,443 |
|
|
|
1,217,293 |
|
|
Other comprehensive loss |
|
|
(246,488 |
) |
|
|
(357,383 |
) |
|
Accumulated deficit |
|
|
(71,713,384 |
) |
|
|
(67,033,041 |
) |
|
Total Novo Integrated Sciences, Inc. stockholders’ equity |
|
|
23,583,217 |
|
|
|
24,815,945 |
|
|
Noncontrolling interest |
|
|
(299,169 |
) |
|
|
(316,870 |
) |
|
Total stockholders’ equity |
|
|
23,284,048 |
|
|
|
24,499,075 |
|
|
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
$ |
37,244,384 |
|
|
$ |
35,563,047 |
|
|
* The condensed consolidated balance sheets’ common stock amounts have been retroactively adjusted to account for the Company’s 1:10 reverse stock split, effective November 7, 2023. |
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The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements. |
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NOVO INTEGRATED SCIENCES, INC. |
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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS |
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For the Three Months Ended November 30, 2023 and 2022 (unaudited) |
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Three Months Ended |
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|
November 30, |
|
November 30, |
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|
|
2023 |
|
|
2022 |
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|
|
|
|
|
|
||||
|
Revenues |
|
$ |
3,891,218 |
|
|
$ |
3,419,280 |
|
|
|
|
|
|
|
|
|
||
|
Cost of revenues |
|
|
1,947,200 |
|
|
|
1,679,747 |
|
|
|
|
|
|
|
|
|
||
|
Gross profit |
|
|
1,944,018 |
|
|
|
1,739,533 |
|
|
|
|
|
|
|
|
|
||
|
Operating expenses: |
|
|
|
|
|
|
||
|
Selling expenses |
|
|
9,586 |
|
|
|
7,332 |
|
|
General and administrative expenses |
|
|
5,252,069 |
|
|
|
3,974,161 |
|
|
Total operating expenses |
|
|
5,261,655 |
|
|
|
3,981,493 |
|
|
|
|
|
|
|
|
|
||
|
Loss from operations |
|
|
(3,317,637 |
) |
|
|
(2,241,960 |
) |
|
|
|
|
|
|
|
|
||
|
Non-operating income (expense) |
|
|
|
|
|
|
||
|
Interest income |
|
|
2,219 |
|
|
|
2,281 |
|
|
Interest expense |
|
|
(143,374 |
) |
|
|
(167,243 |
) |
|
Other expense |
|
|
(652,174 |
) |
|
|
– |
|
|
Change in fair value of derivative liability |
|
|
585,529 |
|
|
|
– |
|
|
Amortization of debt discount |
|
|
(1,075,928 |
) |
|
|
(1,490,513 |
) |
|
Foreign currency transaction losses |
|
|
(59,358 |
) |
|
|
(39,301 |
) |
|
Total non-operating expense |
|
|
(1,343,086 |
) |
|
|
(1,694,776 |
) |
|
|
|
|
|
|
|
|
||
|
Loss before income taxes |
|
|
(4,660,723 |
) |
|
|
(3,936,736 |
) |
|
|
|
|
|
|
|
|
||
|
Income tax expense |
|
|
– |
|
|
|
– |
|
|
|
|
|
|
|
|
|
||
|
Net loss |
|
$ |
(4,660,723 |
) |
|
$ |
(3,936,736 |
) |
|
|
|
|
|
|
|
|
||
|
Net income (loss) attributed to noncontrolling interest |
|
|
19,620 |
|
|
|
(1,323 |
) |
|
|
|
|
|
|
|
|
||
|
Net loss attributed to Novo Integrated Sciences, Inc. |
|
$ |
(4,680,343 |
) |
|
$ |
(3,935,413 |
) |
|
|
|
|
|
|
|
|
||
|
Comprehensive loss: |
|
|
|
|
|
|
||
|
Net loss |
|
|
(4,660,723 |
) |
|
|
(3,936,736 |
) |
|
Foreign currency translation gain (loss) |
|
|
108,976 |
|
|
|
(420,982 |
) |
|
Comprehensive loss: |
|
$ |
(4,551,747 |
) |
|
$ |
(4,357,718 |
) |
|
|
|
|
|
|
|
|
||
|
Weighted average common shares outstanding – basic and diluted |
|
|
16,726,308 |
|
|
|
3,385,508 |
|
|
|
|
|
|
|
|
|
||
|
Net loss per common share – basic and diluted |
|
$ |
(0.28 |
) |
|
$ |
(1.16 |
) |
|
* The condensed consolidated statements of operations and comprehensive loss’s share and per share amounts have been retroactively adjusted to account for the Company’s 1:10 reverse stock split, effective November 7, 2023. |
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The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements. |
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NOVO INTEGRATED SCIENCES, INC. |
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CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY |
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For the Three Months Ended November 30, 2023 and 2022 (unaudited) |
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|
|
|
Common Stock |
|
|
Additional Paid-in |
|
|
Common Stock To |
|
|
Other Comprehensive |
|
Accumulated |
|
Total Novo Stockholders’ |
|
Noncontrolling |
|
Total |
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|
|
|
Shares |
|
|
Amount |
|
|
Capital |
|
|
Be Issued |
|
|
(Loss) Income |
|
Deficit |
|
Equity |
|
Interest |
|
Equity |
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
Balance, August 31, 2023 |
|
|
15,759,325 |
|
|
$ |
15,760 |
|
|
$ |
90,973,316 |
|
|
$ |
1,217,293 |
|
|
$ |
(357,383 |
) |
|
$ |
(67,033,041 |
) |
|
$ |
24,815,945 |
|
|
$ |
(316,870 |
) |
|
$ |
24,499,075 |
|
|
Cashless exercise of warrants |
|
|
245,802 |
|
|
|
246 |
|
|
|
1,323,152 |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
1,323,398 |
|
|
|
– |
|
|
|
1,323,398 |
|
|
Exercise of warrants for cash |
|
|
240,400 |
|
|
|
240 |
|
|
|
240,160 |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
240,400 |
|
|
|
– |
|
|
|
240,400 |
|
|
Share issuance for convertible debt settlement |
|
|
519,845 |
|
|
|
520 |
|
|
|
577,002 |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
577,522 |
|
|
|
– |
|
|
|
577,522 |
|
|
Issuance of common stock to be issued |
|
|
73,767 |
|
|
|
74 |
|
|
|
1,172,776 |
|
|
|
(1,172,850 |
) |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
Common stock issued for services |
|
|
424,080 |
|
|
|
424 |
|
|
|
1,194,976 |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
1,195,400 |
|
|
|
– |
|
|
|
1,195,400 |
|
|
Rounding due to stock split |
|
|
27,973 |
|
|
|
28 |
|
|
|
(28 |
) |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
Foreign currency translation gain |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
110,895 |
|
|
|
– |
|
|
|
110,895 |
|
|
|
(1,919 |
) |
|
|
108,976 |
|
|
Net (loss) income |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
(4,680,343 |
) |
|
|
(4,680,343 |
) |
|
|
19,620 |
|
|
|
(4,660,723 |
) |
|
Balance, November 30, 2023 |
|
|
17,291,192 |
|
|
$ |
17,292 |
|
|
$ |
95,481,354 |
|
|
$ |
44,443 |
|
|
$ |
(246,488 |
) |
|
$ |
(71,713,384 |
) |
|
$ |
23,583,217 |
|
|
$ |
(299,169 |
) |
|
$ |
23,284,048 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Balance, August 31, 2022 |
|
|
3,118,063 |
|
|
$ |
3,118 |
|
|
$ |
66,084,887 |
|
|
$ |
9,474,807 |
|
|
$ |
560,836 |
|
|
$ |
(53,818,489 |
) |
|
$ |
22,305,159 |
|
|
$ |
(257,588 |
) |
|
$ |
22,047,571 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Units issued for cash, net of offering costs |
|
|
400,000 |
|
|
|
400 |
|
|
|
1,794,600 |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
1,795,000 |
|
|
|
– |
|
|
|
1,795,000 |
|
|
Issuance of common stock to be issued |
|
|
3,623 |
|
|
|
4 |
|
|
|
92,362 |
|
|
|
(92,366 |
) |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
Cashless exercise of warrants |
|
|
467,399 |
|
|
|
467 |
|
|
|
1,138,583 |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
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 |
|
|
3,989,085 |
|
|
$ |
3,989 |
|
|
$ |
69,171,319 |
|
|
$ |
9,382,441 |
|
|
$ |
143,828 |
|
|
$ |
(57,753,902 |
) |
|
$ |
20,947,675 |
|
|
$ |
(262,885 |
) |
|
$ |
20,684,790 |
|
|
* The condensed consolidated statements of stockholders’ equity share amounts have been retroactively adjusted to account for the Company’s 1:10 reverse stock split, effective November 7, 2023. |
||||||||||||||||||||||||||||||||||||
|
The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements. |
||||||||||||||||||||||||||||||||||||
|
NOVO INTEGRATED SCIENCES, INC. |
||||||||
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
|
For the Three Months Ended November 30, 2023 and 2022 (unaudited) |
||||||||
|
|
|
Three Months Ended |
|
|||||
|
|
|
November 30, |
|
|
November 30, |
|
||
|
|
|
2023 |
|
|
2022 |
|
||
|
|
|
|
|
|
||||
|
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(4,660,723 |
) |
|
$ |
(3,936,736 |
) |
|
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
572,404 |
|
|
|
586,166 |
|
|
Fair value of vested stock options |
|
|
– |
|
|
|
60,887 |
|
|
Financing costs for debt extension |
|
|
1,323,398 |
|
|
|
1,139,050 |
|
|
Common stock issued for services |
|
|
1,195,400 |
|
|
|
– |
|
|
Operating lease expense |
|
|
149,877 |
|
|
|
209,846 |
|
|
Amortization of debt discount |
|
|
1,075,928 |
|
|
|
1,490,513 |
|
|
Foreign currency transaction losses |
|
|
59,358 |
|
|
|
39,301 |
|
|
Change in fair value of derivative liability |
|
|
(585,529 |
) |
|
|
– |
|
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(1,168,350 |
) |
|
|
28,174 |
|
|
Inventory |
|
|
(166,476 |
) |
|
|
(157,118 |
) |
|
Prepaid expenses and other current assets |
|
|
130,584 |
|
|
|
1,471 |
|
|
Accounts payable |
|
|
(98,996 |
) |
|
|
321,961 |
|
|
Accrued expenses |
|
|
71,214 |
|
|
|
149,945 |
|
|
Accrued interest |
|
|
99,430 |
|
|
|
(9,232 |
) |
|
Operating lease liability |
|
|
(149,877 |
) |
|
|
(202,465 |
) |
|
Net cash used in operating activities |
|
|
(2,152,358 |
) |
|
|
(278,237 |
) |
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
|
|
Repayments to related parties |
|
|
(72,402 |
) |
|
|
(48,480 |
) |
|
Repayments of notes payable |
|
|
(183,100 |
) |
|
|
– |
|
|
Repayments of finance leases |
|
|
(2,779 |
) |
|
|
(2,763 |
) |
|
Proceeds from issuance of convertible notes |
|
|
3,314,153 |
|
|
|
– |
|
|
Repayment of convertible notes |
|
|
– |
|
|
|
(2,777,778 |
) |
|
Proceeds from the sale of units, net of offering costs |
|
|
– |
|
|
|
1,795,000 |
|
|
Proceeds from exercise of warrants |
|
|
240,400 |
|
|
|
– |
|
|
Net cash provided by (used in) financing activities |
|
|
3,296,272 |
|
|
|
(1,034,021 |
) |
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash and cash equivalents |
|
|
79,770 |
|
|
|
12,271 |
|
|
|
|
|
|
|
|
|
|
|
|
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS |
|
|
1,223,684 |
|
|
|
(1,299,987 |
) |
|
|
|
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD |
|
|
416,323 |
|
|
|
2,178,687 |
|
|
|
|
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS, END OF PERIOD |
|
$ |
1,640,007 |
|
|
$ |
878,700 |
|
|
|
|
|
|
|
|
|
|
|
|
CASH PAID FOR: |
|
|
|
|
|
|
|
|
|
Interest |
|
$ |
45,321 |
|
|
$ |
186,911 |
|
|
Income taxes |
|
$ |
– |
|
|
$ |
– |
|
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL NON-CASH INVESTING AND FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
|
|
Debt discount recognized on derivative liability |
|
$ |
3,071,653 |
|
|
$ |
1,390,380 |
|
|
Common stock issued for convertible debt settlement |
|
$ |
577,522 |
|
|
$ |
– |
|
|
Debt discount recognized on convertible note |
|
$ |
3,735,414 |
|
|
$ |
– |
|
|
The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements. |
||||||||
Contacts
Chris David, COO-President
Novo Integrated Sciences, Inc.
chris.david@novointegrated.com
(888) 512-1195
