Cleantek Industries : Q2 2022 Financial Statements

Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2022

Cleantek Industries Inc.

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited)

As at

		June 30	December 31
(Canadian $000's)	Note	2022	2021
ASSETS
Current assets
Cash and cash equivalents		936	1,871
Accounts receivable		2,302	1,931
Prepaids		283	383
Other assets		215	586
Total current assets		3,736	4,771
Non-current assets
Property and equipment	3	10,275	11,279
Intangible assets	4	476	459
Right-of-use assets		588	647
Total non-current assets		11,339	12,385
Total assets		15,075	17,156
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued liabilities		1,855	2,825
Current portion of long-term debt	5	1,619	1,045
Current portion of lease liabilities		319	366
Total current liabilities		3,793	4,236
Non-current liabilities
Long-term debt	5	7,746	7,444
Lease liabilities		378	431
Provisions		57	57
Total non-current liabilities		8,181	7,932
Total liabilities		11,974	12,168
Shareholders' equity (deficit)
Share capital	6	68,466	68,466
Contributed surplus		2,819	2,524
Accumulated other comprehensive income		155	160
Accumulated deficit		(68,339)	(66,162)
Total shareholders' equity (deficit)		3,101	4,988
Total liabilities and shareholders' equity (deficit)		15,075	17,156
Commitments and contingencies	13
Subsequent events	14

The accompanying notes are an integral part of these interim condensed consolidated interim financial statements.

2022 Q2 Condensed Consolidated Interim Financial Statements Cleantek Industries Inc. 2

Cleantek Industries Inc.

CONSOLIDATED STATEMENTS OF NET LOSS (Unaudited)

For the periods

		Three months ended	Six months ended
			June 30		June 30
(Canadian $000's, except per share amounts)	Note	2022	2021	2022	2021
Revenue	8	3,125	1,945	6,272	4,402
Direct operating expenses	9	1,419	1,023	2,729	2,051
Gross profit		1,706	922	3,543	2,351
Other expenses
General and administrative	9	1,937	1,004	3,216	1,640
Depreciation and amortization	3,4	928	712	1,852	1,499
Research expense (recovery)		-	(688)	-	(688)
Share-based compensation	7	147	177	295	327
Finance costs, net	10	274	476	538	954
(Gain) loss on disposal of long-lived assets		(21)	(3)	(148)	3
Foreign exchange (gain) loss		(116)	(40)	(33)	(78)
		3,149	1,638	5,720	3,657
Loss before income taxes		(1,443)	(716)	(2,177)	(1,306)
Income tax (recovery) expense
Current		-	-	-	-
Deferred		-	(89)	-	(495)
		-	(89)	-	(495)
Net loss		(1,443)	(627)	(2,177)	(811)
Loss per share ($)
Basic and diluted	11	$(0.05)	$(0.04)	$(0.08)	$(0.05)

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

Cleantek Industries Inc.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited)

For the periods

		Three months ended	Six months ended
			June 30		June 30
(Canadian $000's)	Note	2022	2021	2022	2021
Net loss		(1,443)	(627)	(2,177)	(811)
Other comprehensive loss
Foreign currency translation gain (loss)		(50)	(34)	(5)	(61)
Total comprehensive loss		(1,493)	(661)	(2,182)	(872)

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

2022 Q2 Condensed Consolidated Interim Financial Statements Cleantek Industries Inc. 3

Cleantek Industries Inc.

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (DEFICIT) (Unaudited)

		Share	Contributed	Accumulated other	Accumulated
		Comprehensive
(Canadian $000's)	Note	capital	surplus	income (loss)	deficit	Total
At January 1, 2021		51,708	1,080	141	(60,207)	(7,278)
Net loss for the period		-	-	-	(811)	(811)
Share-based compensation expense	7	-	327	-	-	327
Share issuance - in cash for	6	165	-	-	-	165
Cleantek
Share conversions	6	355	-	-	-	355
Foreign currency translation loss		-	-	(61)	-	(61)
At June 30, 2021		52,228	1,407	80	(61,018)	(7,303)
At January 1, 2022		68,466	2,524	160	(66,162)	4,988
Net loss for the period		-	-	-	(2,177)	(2,177)
Share-based compensation expense	7	-	295	-	-	295
Foreign currency translation loss		-	-	(5)	-	(5)
At June 30, 2022		68,466	2,819	155	(68,339)	3,101

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

2022 Q2 Condensed Consolidated Interim Financial Statements Cleantek Industries Inc. 4

Cleantek Industries Inc.

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

For the periods

		Three months ended	Six months ended
			June 30		June 30
(Canadian $000's)	Note	2022	2021	2022	2021
Cash (used in)/provided by:
Operating activities
Net loss		(1,443)	(627)	(2,177)	(811)
Adjustments for:
Depreciation and amortization	3,4	928	712	1,852	1,499
Share-based compensation expense	7	147	177	295	327
Finance costs	10	274	476	538	954
(Gain) loss on disposal of long-lived assets		(21)	(3)	(148)	3
Deferred income tax expense (recovery)		-	(89)	-	(495)
Changes in non-cash working capital	12	137	514	(853)	(302)
Net cash flow from (used in) operating activities		22	1,160	(493)	1,175
Investing activities
Additions to property and equipment	3	(406)	(77)	(680)	(214)
Additions to intangible assets	4	(23)	(21)	(46)	(63)
Proceeds on disposal of long-lived assets		-	45	100	45
Changes in non-cash working capital	12	29	-	(54)	-
Net cash flow used in investing activities		(400)	(53)	(680)	(232)
Financing activities
Proceeds from long-term debt		1,234	-	1,234	-
Repayment of long-term debt	5	(297)	(209)	(434)	(285)
Proceeds from convertible notes - debentures		-	-	-	380
Repayments of lease liabilities		(18)	(81)	(113)	(135)
Payments of cash interest		(237)	(222)	(454)	(435)
Proceeds from issuance of share capital	6	-	-	-	165
Net cash flow from financing activities		682	(512)	233	(310)
Increase (decrease) in cash and cash equivalents		304	(595)	(940)	633
Effect of foreign exchange on cash and cash
equivalents		8	(76)	5	(61)
Cash and cash equivalents, beginning of period		624	650	1,871	597
Cash and cash equivalents, end of period		936	1,169	936	1,169

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

2022 Q2 Condensed Consolidated Interim Financial Statements Cleantek Industries Inc. 5