TraceSafe Inc.
Condensed Interim Consolidated Financial Statements
Period Ended June 30, 2022
(Expressed in United States Dollars)
(Unaudited)
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TraceSafe Inc.
Condensed Interim Consolidated Statements of Financial Position
(Expressed in US Dollars-Unaudited)
June 30 | December 31 | |||||
Notes | 2022 | 2021 | ||||
ASSETS | ||||||
Current assets | ||||||
Cash | $ | 67,069 | $ | 356,665 | ||
Restricted term deposits | 5 | 51,528 | 51,543 | |||
Trade and other receivables | 6 | 122,781 | 510,245 | |||
Prepaids | 7 | 162,553 | 343,408 | |||
Inventories | 8 | 419,852 | 556,962 | |||
Deferred contract asset | 14 | 168,895 | 209,429 | |||
Total current assets | 992,678 | 2,028,252 | ||||
Property and equipment | 9 | 41,312 | 64,294 | |||
Investment | 10 | 2,202,449 | 2,202,449 | |||
Total Assets | $ | 3,236,439 | $ | 4,294,995 | ||
LIABILITIES AND SHAREHOLDERS' DEFICIENCY | ||||||
Current liabilities | ||||||
Trade payables and accrued liabilities | 13 | $ | 1,831,234 | $ | 2,387,692 | |
Deferred revenue | 14 | 413,905 | 1,154,921 | |||
Loans payable | 15 | 623,075 | 756,275 | |||
Total current liabilities | 2,868,214 | 4,298,888 | ||||
Loans payable | 15 | 2,150,457 | - | |||
Derivative liabilities | 15 | 155,068 | - | |||
Total Liabilities | 5,173,739 | 4,298,888 | ||||
Shareholders' Deficiency | 16 | 20,095,592 | 19,840,230 | |||
Share capital | ||||||
Reserves | 16 | 1,703,167 | 898,122 | |||
Accumulated other comprehensive income | 1,251,057 | 1,279,742 | ||||
Deficit | (18,358,235) | (15,806,306) | ||||
Equity attributable to owners of the parent | 4,691,580 | 6,211,788 | ||||
Equity attributable to non-controlling interest | 4 | (6,628,880) | (6,215,681) | |||
Total Shareholders' Deficiency | (1,937,300) | (3,893) | ||||
Total Liabilities and Shareholders' Deficiency | $ | 3,236,439 | $ | 4,294,995 | ||
Nature and continuance of operations (note 1) | ||||||
Commitment (note 22) | ||||||
Subsequent events (note 25) | ||||||
Approved and authorized for issuance by the Board of Directors on Aug 25, 2022. | ||||||
"James Passin" | "Wayne Lloyd" | |||||
Director | Director |
The accompanying notes are an integral part of the condensed interim consolidated financial statements.
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TraceSafe Inc.
Condensed Interim Consolidated Statements of Comprehensive Loss
(Expressed in US Dollars-Unaudited)
Three months ended June 30 | Six months ended June 30 | ||||||
Notes | 2022 | 2021 | 2022 | 2021 | |||
Revenue | |||||||
Product sales | 20 | $ | 550,941 | 2,849,701 | $ | 985,109 | $ 3,689,936 |
Service income | 20 | 265,744 | 549,608 | 1,088,560 | 996,548 | ||
816,685 | 3,399,309 | 2,073,669 | 4,686,484 | ||||
Cost of revenue | 20 | (37,508) | (3,010,170) | (438,384) | (4,150,094) | ||
779,177 | 389,139 | 1,635,285 | 536,390 | ||||
Operating expenses | |||||||
Bad debt expense | 6 | 950 | - | 950 | 5,000 | ||
Bank Fees | 2,312 | 3,505 | 6,347 | 7,367 | |||
Amortization | 9,11 | 14,108 | 1,697 | 22,965 | 2,440 | ||
Research and development | 17 | 337,678 | 489,124 | 776,657 | 945,038 | ||
General and administration | 17 | 127,588 | 139,464 | 247,210 | 382,242 | ||
Marketing | 18,848 | 95,687 | 77,907 | 123,875 | |||
Personnel | 17 | 776,981 | 955,696 | 1,766,458 | 1,898,439 | ||
Professional fees | 17 | 439,858 | 300,235 | 1,023,042 | 532,482 | ||
Regulatory | 7,923 | 9,157 | 10,892 | 23,075 | |||
Share-based compensation | 16,17 | 264,129 | - | 805,045 | 2,126,286 | ||
1,900,375 | 1,994,565 | 4,737,473 | 6,046,243 | ||||
Operating loss | (1,211,198) | (1,605,426) | (3,102,188) | (5,509,853) | |||
Other items | |||||||
Change in fair value of | 15 | (261,184) | - | (603,448) | - | ||
derivative liability | |||||||
Other income | 24 | (15,305) | - | (68,277) | (11,891) | ||
Finance costs | 16 | 248,805 | 129,944 | 506,283 | 243,716 | ||
Foreign exchange | (48,102) | 11,193 | (21,645) | 22,692 | |||
Net loss | (1,135,113) | (1,746,563) | (2,915,101) | (5,764,370) | |||
Tax expense | 49,731 | 60,288 | 50,030 | 60,288 | |||
Net loss after tax | (1,184,844) | (1,806,851) | (2,965,131) | (5,824,658) | |||
Other comprehensive loss | |||||||
Items that may be reclassified | |||||||
to profit or loss | |||||||
Exchange differences on | |||||||
translation of foreign | (28,680) | - | (28,680) | - | |||
operations | |||||||
Total comprehensive loss | $ | (1,213,524) | (1,806,851) | $ | (2,993,814) | $ (5,824,658) | |
Total comprehensive loss for | |||||||
the period attributable to: | |||||||
Owners of the parent | 4 | $ | (1,239,211) | $ (393,134) | $ | (2,580,616) | $ (3,278,036) |
Non-controlling interest | 33,340 | (1,413,717) | (413,200) | (2,546,622) | |||
Total comprehensive loss | $ | (1,205,871) | $ (1,806,851) | $ | (2,993,814) | $ (5,824,658) | |
Loss per share - basic and | |||||||
diluted | $ | (0.03) | $ (0.01) | $ | (0.06) | $ (0.08) | |
Weighted average number of | |||||||
shares outstanding | 43,178,086 | 40,606,041 | 43,178,086 | 40,606,041 | |||
- basic and diluted |
The accompanying notes are an integral part of the condensed interim consolidated financial statements.
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TraceSafe Inc.
Condensed Interim Consolidated Statements of Changes in Shareholders' Deficiency
(Expressed in US Dollars-Unaudited)
Share Capital | Accumulated Other | Equity attributable | |||||||||||||||
to non-controlling | |||||||||||||||||
Number of | Obligation to | Comprehensive | Equity attributable to | ||||||||||||||
interest | |||||||||||||||||
Shares | Amount | issue shares | Reserves | Income | Deficit | owners of parent | Total | ||||||||||
Balance, December 31, 2020 | 35,765,784 | $ | 15,946,318 | $ | 820,690 | $ | 1,752,881 | $ | 2,195,480 | $ | (15,916,656) | $ | 4,798,713 | $ | 3,514,415 | $ | 8,313,128 |
Shares issued pursuant to acquisition | ||||||||||||||||
agreement | 4,400,000 | 1,848,049 | - | - | - | - | 1,848,049 | (1,848,049) | - | |||||||
Options exercised | 455,000 | 166,727 | - | (72,600) | - | - | 94,127 | - | 94,127 | |||||||
Warrants exercised | 1,300,170 | 511,433 | - | - | - | - | 511,433 | - | 511,433 | |||||||
Shares issued for services | 1,240,301 | 566,638 | - | - | - | - | 566,638 | - | 566,638 | |||||||
Stock-based compensation | - | - | - | 328,052 | - | - | 328,052 | - | 328,052 | |||||||
Performance shares issued | 2,550,000 | 820,690 | (820,690) | - | - | - | - | - | ||||||||
Option reserve adjusted due to | ||||||||||||||||
forfeiture | - | - | - | (1,218,132) | - | 1,218,132 | - | - | - | |||||||
Warrant reserve adjusted from share | ||||||||||||||||
capital | - | (19,625) | - | 22,619 | - | - | 2,994 | - | 2,994 | |||||||
Equity component on convertible | ||||||||||||||||
debenture | - | - | - | 85,302 | - | - | 85,302 | - | 85,302 | |||||||
Remeasurement investment in | ||||||||||||||||
Airbeam | - | - | - | - | (900,255) | - | (900,255) | - | (900,255) | |||||||
Translation difference | - | - | - | - | (15,483) | - | (15,483) | - | (15,483) | |||||||
Net loss for the year | - | - | - | - | - | (1,107,782) | (1,107,782) | (7,882,047) | (8,989,829) | |||||||
Balance December 31, 2021 | 45,711,255 | $ | 19,840,230 | $ | - | $ | 898,122 | $1,279,742 | $ | (15,806,306) | $6,211,788 | $ | (6,215,681) | $ | (3,893) | |
Shares issued for services | 809,403 | 216,090 | - | - | - | - | 216,090 | - | 216,090 | |||||||
Shares issued on conversion of | ||||||||||||||||
promissory notes | 336,666 | 39,272 | - | - | - | - | 39,272 | - | 39,272 | |||||||
Stock-based compensation | - | - | - | 805,045 | - | - | 805,045 | - | 805,045 | |||||||
Translation difference | - | - | - | - | (28,680) | - | (28,680) | - | (28.680) | |||||||
Net loss for the period | - | - | - | - | - | (2,551,931) | (2,551,931) | (413,200) | (2,965,130) | |||||||
Balance June 30, 2022 | 46,857,324 | $ | 20,095,592 | $ | - | $ | 1,703,167 | $1,251,057 | $ | (18,358,235) | $4,691,584 | $ | (6,628,881) | $ | (1,937,298) |
The accompanying notes are an integral part of the condensed interim consolidated financial statements.
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TraceSafe Inc.
Condensed Interim Consolidated Statements of Cash Flows
(Expressed in US Dollars-Unaudited)
Six months ended June 30, | ||||
2022 | 2021 | |||
Cash provided by (used in): | ||||
Operating activities | ||||
Net loss | $ | (2,965,129) | $ | (5,824,687) |
Adjustment to reconcile non-cash items | ||||
Amortization | 22,446 | 73,573 | ||
Finance costs | 279,771 | - | ||
Change in fair value of derivative liability | (603,448) | |||
Shares issued for services | 216,090 | - | ||
Share-based compensation | 805,045 | - | ||
Foreign exchange | 346 | - | ||
Changes in working capital | ||||
Trade and other receivables | 375,559 | (991,244) | ||
Prepaids | 192,760 | 651,938 | ||
Inventories | 137,110 | - | ||
Trade payables and accrued liabilities | (542,968) | 856,451 | ||
Deferred revenue | (741,016) | 2,770,910 | ||
Deferred contract asset | 40,534 | - | ||
Net cash used in operating activities | (2,782,900) | (2,463,059) | ||
Investing activities | ||||
Purchase of property and equipment | - | (31,444) | ||
Net cash used in investing activities | - | (31,444) | ||
Financing activities | (13,235) | - | ||
Lease payments | ||||
Proceeds from share issuance | - | 2,924,396 | ||
Proceeds from issuance of convertible debt | 3,000,000 | - | ||
Convertible debt transaction costs | (298,865) | - | ||
Repayment of loan payable | (205,183) | (682,194) | ||
Proceeds from loan payable | 39,272 | 311,594 | ||
Net cash provided by financing activities | 2,521,989 | 2,553,796 | ||
Change in cash | (260,911) | 59,293 | ||
Effect of change in foreign exchange rates | (28,685) | 1 | ||
Cash, beginning of period | 356,665 | 605,426 | ||
Cash, end of period | $ | 67,069 | $ | 664,720 |
Supplemental cash flow information (note 23)
The accompanying notes are an integral part of the condensed interim consolidated financial statements.
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TraceSafe Inc. published this content on 26 August 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 08 September 2022 19:39:00 UTC.