Know Labs, Inc. Reports Second Quarter FY2023 Results
Financial Highlights:
-
Know Labs reported a net loss of
in the second quarter of 2023, compared to a net loss of$4.93 million dollars in the year-ago period, which translates to Earnings Per Share of a loss of$6.14 million dollars , an improvement over the year ago period of a loss of$0.10 .$0.16 -
Research and development expense for the second quarter was
as compared to$2.56 million dollars in 2022. The increase in R&D expense was related to staff increases in engineering, third party technical services and expenditures related to the development of our Bio-RFID technology and Generation 1 device, as we continue to execute our path to FDA clinical trials and commercialization.$1.25 million dollars -
Selling, general and administrative expense for the quarter was
versus$2.24 million dollars in 2022, which increased versus the prior year primarily to due to key additions to the executive team and increases in third party services.$1.49 million -
As of March 31, 2023, we had cash and cash equivalents of
, as compared to$6.27 million dollars at the end of September 30, 2022. Net cash used in operations for the six months ended March 31, 2023 was$12.59 million compared with$6.34 million dollars in the prior year. During the quarter ended March 31, 2023, the Company made adjustments to its staffing and the impact of those adjustments will significantly reduce our monthly burn rate. Given the significant reduction in fixed expenses, the Company believes that it has enough available cash and flexibility with its operating expenses to operate until at least February 2024.$1.02 million -
Shareholder equity for the second quarter 2023 was
versus$3.4 million as of September 30, 2022.$9.9 million
Income Statement:
Three Months Ended, | Six Months Ended, | |||||||||||||||
March 31, 2023 | March 31, 2022 | March 31, 2023 | March 31, 2022 | |||||||||||||
REVENUE- DIGITAL ASSET SALES | $ |
- |
|
$ |
8,687 |
|
$ |
- |
|
$ |
4,360,087 |
|
||||
OPERATING EXPENSES- |
|
|
|
|
||||||||||||
RESEARCH AND DEVELOPMENT EXPENSES |
|
2,563,469 |
|
|
1,248,707 |
|
|
4,306,520 |
|
|
2,134,459 |
|
||||
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES |
|
2,242,658 |
|
|
1,448,227 |
|
|
4,147,729 |
|
|
2,665,174 |
|
||||
SELLING AND TRANSACTIONAL COSTS FOR DIGITAL ASSETS |
|
- |
|
|
154,502 |
|
|
- |
|
|
3,272,862 |
|
||||
Total operating expenses |
|
4,806,127 |
|
|
2,851,436 |
|
|
8,454,249 |
|
|
8,072,495 |
|
||||
OPERATING LOSS |
|
(4,806,127 |
) |
|
(2,842,749 |
) |
|
(8,454,249 |
) |
|
(3,712,408 |
) |
||||
|
|
|
|
|||||||||||||
OTHER (EXPENSE): |
|
|
|
|
||||||||||||
Interest expense, net |
|
(124,075 |
) |
|
(3,297,989 |
) |
|
(298,812 |
) |
|
(7,784,949 |
) |
||||
Total other (expense), net |
|
(124,075 |
) |
|
(3,297,989 |
) |
|
(298,812 |
) |
|
(7,784,949 |
) |
||||
|
|
|
|
|||||||||||||
LOSS BEFORE INCOME TAXES |
|
(4,930,202 |
) |
|
(6,140,738 |
) |
|
(8,753,061 |
) |
|
(11,497,357 |
) |
||||
|
|
|
|
|||||||||||||
Income tax expense |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
||||
|
|
|
|
|||||||||||||
NET LOSS | $ |
(4,930,202 |
) |
$ |
(6,140,738 |
) |
$ |
(8,753,061 |
) |
$ |
(11,497,357 |
) |
||||
|
|
|
|
|||||||||||||
Basic and diluted loss per share | $ |
(0.10 |
) |
$ |
(0.16 |
) |
$ |
(0.18 |
) |
$ |
(0.31 |
) |
||||
|
|
|
|
|||||||||||||
Weighted average shares of common stock outstanding- basic and diluted |
|
48,207,937 |
|
|
37,872,406 |
|
|
48,197,581 |
|
|
36,655,905 |
|
||||
Balance Sheet:
March 31, 2023 | September 30, 2022 (1) | |||||||
ASSETS | Unaudited | |||||||
CURRENT ASSETS: | ||||||||
Cash and cash equivalents | $ |
6,226,029 |
|
$ |
12,593,692 |
|
||
Total current assets |
|
6,226,029 |
|
|
12,593,692 |
|
||
|
|
|||||||
PROPERTY AND EQUIPMENT, NET |
|
699,740 |
|
|
862,977 |
|
||
|
|
|||||||
OTHER ASSETS |
|
|
||||||
Other assets |
|
15,766 |
|
|
13,767 |
|
||
Operating lease right of use asset |
|
198,318 |
|
|
287,930 |
|
||
|
|
|||||||
TOTAL ASSETS | $ |
7,139,853 |
|
$ |
13,758,366 |
|
||
|
|
|||||||
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
||||||
|
|
|||||||
CURRENT LIABILITIES: |
|
|
||||||
Accounts payable - trade | $ |
516,204 |
|
$ |
526,968 |
|
||
Accrued expenses |
|
434,321 |
|
|
462,940 |
|
||
Accrued expenses - related parties |
|
322,714 |
|
|
348,264 |
|
||
Convertible notes payable, net |
|
2,255,066 |
|
|
2,255,066 |
|
||
Current portion of operating lease right of use liability |
|
206,101 |
|
|
215,397 |
|
||
Total current liabilities |
|
3,734,406 |
|
|
3,808,635 |
|
||
|
|
|||||||
NON-CURRENT LIABILITIES: |
|
|
||||||
Operating lease right of use liability, net of current portion |
|
4,144 |
|
|
87,118 |
|
||
Total non-current liabilities |
|
4,144 |
|
|
87,118 |
|
||
|
|
|||||||
COMMITMENTS AND CONTINGENCIES (Note 11) |
|
- |
|
|
- |
|
||
|
|
|||||||
STOCKHOLDERS' EQUITY |
|
|
||||||
Preferred stock - |
|
|
||||||
and outstanding as follows: |
|
|
||||||
Series C Convertible Preferred stock |
|
|
||||||
1,785,715 shares issued and outstanding at 3/31/2023 and 9/30/2022, respectively |
|
1,790 |
|
|
1,790 |
|
||
Series D Convertible Preferred stock |
|
|
||||||
1,016,004 shares issued and outstanding at 3/31/2023 and 9/30/2022, respectively |
|
1,015 |
|
|
1,015 |
|
||
Common stock - |
|
|
||||||
shares issued and outstanding at 3/31/2023 and 9/30/2022, respectively |
|
48,209 |
|
|
48,158 |
|
||
Additional paid in capital |
|
113,501,088 |
|
|
111,209,388 |
|
||
Accumulated deficit |
|
(110,150,799 |
) |
|
(101,397,738 |
) |
||
Total stockholders' equity |
|
3,401,303 |
|
|
9,862,613 |
|
||
|
|
|||||||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ |
7,139,853 |
|
$ |
13,758,366 |
|
||
|
|
|||||||
(1) Derived from audited consolidated balance sheet. |
|
- |
|
|
- |
|
||
Cash Flow:
Six Months Ended, | ||||||||
|
March 31, 2023 |
|
March 31, 2022 |
|||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Net loss | $ |
(8,753,061 |
) |
|
$ |
(11,497,357 |
) |
|
Adjustments to reconcile net loss to net cash (used in) |
|
|
|
|||||
operating activities |
|
|
|
|||||
Depreciation and amortization |
|
205,094 |
|
|
|
118,068 |
|
|
Issuance of common stock for services |
|
- |
|
|
|
153,000 |
|
|
Issuance of common stock warrants for services |
|
- |
|
|
|
71,220 |
|
|
Stock based compensation- stock option grants |
|
1,927,187 |
|
|
|
636,651 |
|
|
Right of use, net |
|
(2,658 |
) |
|
|
(11,203 |
) |
|
Interest expense for extension of notes and warrants |
|
349,721 |
|
|
|
- |
|
|
Amortization of debt discount to interest expense |
|
- |
|
|
|
7,272,911 |
|
|
Changes in operating assets and liabilities: |
|
|
|
|||||
Other long-term assets |
|
(1,999 |
) |
|
|
- |
|
|
Accounts receivable-related party |
|
- |
|
|
|
(119,210 |
) |
|
Accounts payable - trade and accrued expenses |
|
(64,933 |
) |
|
|
2,353,901 |
|
|
NET CASH (USED IN) OPERATING ACTIVITIES |
|
(6,340,649 |
) |
|
|
(1,022,019 |
) |
|
|
|
|
||||||
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|||||
Purchase of research and development equipment |
|
(41,857 |
) |
|
|
(826,956 |
) |
|
NET CASH (USED IN) INVESTING ACTIVITIES: |
|
(41,857 |
) |
|
|
(826,956 |
) |
|
|
|
|
||||||
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|||||
Proceeds from issuance of common stock for stock options exercise |
|
2,343 |
|
|
|
11,344 |
|
|
Proceeds from issuance of common stock for warrant exercise |
|
12,500 |
|
|
|
766,486 |
|
|
NET CASH PROVIDED BY FINANCING ACTIVITIES |
|
14,843 |
|
|
|
777,830 |
|
|
|
|
|
||||||
NET (DECREASE) IN CASH AND CASH EQUIVALENTS |
|
(6,367,663 |
) |
|
|
(1,071,145 |
) |
|
|
|
|
||||||
CASH AND CASH EQUIVALENTS, beginning of period |
|
12,593,692 |
|
|
|
12,258,218 |
|
|
|
|
|
||||||
CASH AND CASH EQUIVALENTS, end of period | $ |
6,226,029 |
|
|
$ |
11,187,073 |
|
|
|
|
|
Conference Call:
Know Labs will host an audio webcast to discuss its results and provide a business update today, May 15, 2023, at 4:30 pm ET (1:30 pm PT). The live webcast will be available on the Investors page of the Company’s website, www.knowlabs.co/investors, and a replay will be available for six months.
Participant Dial-In: 877-514-3621 / +1 215-268-9856
Webcast: https://event.choruscall.com/mediaframe/webcast.html?webcastid=V4PBKLvm
A copy of the form 10-Q filed with the SEC can also be downloaded from the Company’s website.
About Know Labs, Inc.
Know Labs, Inc. is a public company whose shares trade on the NYSE American Exchange under the stock symbol “KNW.” The Company’s technology uses spectroscopy to direct electromagnetic energy through a substance or material to capture a unique molecular signature. The Company refers to its technology as Bio-RFID™. The Bio-RFID technology can be integrated into a variety of wearable, mobile or bench-top form factors. This patented and patent-pending technology makes it possible to effectively identify and monitor analytes that could only previously be performed by invasive and/or expensive and time-consuming lab-based tests. The first application of our Bio-RFID technology will be in a product marketed as a non-invasive glucose monitor. It will provide the user with real-time information on blood glucose levels. This product will require
Safe Harbor Statement
This release contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements appear in a number of places in this release and include all statements that are not statements of historical fact regarding the intent, belief or current expectations of Know Labs, Inc., its directors or its officers with respect to, among other things: (i) financing plans; (ii) trends affecting its financial condition or results of operations; (iii) growth strategy and operating strategy; and (iv) performance of products. You can identify these statements by the use of the words “may,” “will,” “could,” “should,” “would,” “plans,” “expects,” “anticipates,” “continue,” “estimate,” “project,” “intend,” “likely,” “forecast,” “probable,” “potential,” and similar expressions and variations thereof are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond Know Labs, Inc.’s ability to control, and actual results may differ materially from those projected in the forward-looking statements as a result of various factors. These risks and uncertainties also include such additional risk factors as are discussed in the Company’s filings with the
View source version on businesswire.com: https://www.businesswire.com/news/home/20230515005702/en/
For Know Labs Media Inquiries:
Matter Health
Laura Bastardi
Knowlabs@matternow.com
Ph. (603) 494-6667
Know Labs, Inc.:
Jordyn Hujar
jordyn@knowlabs.co
Ph. (206) 629-6414
Source: Know Labs, Inc.