Know Labs, Inc. (NYSE American: KNW), an emerging developer of non-invasive medical diagnostic technology, today reported financial results for the quarter and fiscal year ended September 30, 2022.
Financial Highlights:
- Consolidated revenues were $4.360 million for the fiscal year ended September 30, 2022.
- Research and development expense was $5.386 million for the fiscal year ended September 30, 2022 as compared to $3.970 million in 2021. The increase in R&D was related to staff increases in engineering, third party technical services, and expenditures related to the development of the Company’s Bio-RFID technology, as the Company continues to execute its path to FDA clinical trials and commercialization.
- Non-GAAP net loss as adjusted for the fiscal year was $7.929 million, a slight increase of $270,000 compared to the prior year. 2022 GAAP EPS was a loss of $0.50 per share as compared to a loss of $0.86 per share during 2021.
- Current assets for the fiscal year stood at $12.594 million versus current liabilities of $3.810 million, for a current ratio of 3.61 in 2022 versus a current ratio of 1.17 in 2021.
- As of September 30, 2022, cash and cash equivalents equaled $12.594 million, as compared with $12.258 million in 2021. Net cash used in operations for the 2022 fiscal year was $6.920 million, as compared to $6.851 million in 2021. We believe our cash on hand will be sufficient to fund our operations through December 31, 2023.
- Shareholder equity was $9.862 million as of September 30, 2022, compared to $1.242 million in 2021.
Income Statement:
| KNOW LABS, INC. AND SUBSIDIARIES | ||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
| Years Ended, | ||||||||
| September 30, 2022 | September 30, 2021 | |||||||
| REVENUE- DIGITAL ASSET SALES | $ |
4,360,087 |
|
$ |
- |
|
||
| OPERATING EXPENSES- | ||||||||
| RESEARCH AND DEVELOPMENT EXPENSES | 5,385,586 |
|
3,969,972 |
|
||||
| SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | 8,118,137 |
|
6,476,176 |
|
||||
| SELLING AND TRANSACTIONAL COSTS FOR DIGITAL ASSETS | 3,430,438 |
|
- |
|
||||
| Total operating expenses | 16,934,161 |
|
10,446,148 |
|
||||
| OPERATING LOSS | (12,574,074 |
) |
(10,446,148 |
) |
||||
| OTHER INCOME (EXPENSE): | ||||||||
| Interest expense | (8,018,798 |
) |
(14,914,065 |
) |
||||
| Other income | 521,628 |
|
- |
|
||||
| Total other (expense), net | (7,497,170 |
) |
(14,914,065 |
) |
||||
| LOSS BEFORE INCOME TAXES | (20,071,244 |
) |
(25,360,213 |
) |
||||
| Income tax expense | - |
|
- |
|
||||
| NET LOSS | $ |
(20,071,244 |
) |
$ |
(25,360,213 |
) |
||
| Basic and diluted loss per share | $ |
(0.50 |
) |
$ |
(0.86 |
) |
||
| Weighted average shares of common stock outstanding- basic and diluted | 40,370,473 |
|
29,370,596 |
|
||||
Balance Sheet:
| KNOW LABS, INC. AND SUBSIDIARIES | ||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||
| September 30, 2022 | September 30, 2021 | |||||||
| ASSETS | ||||||||
| CURRENT ASSETS: | ||||||||
| Cash and cash equivalents | $ |
12,593,692 |
|
$ |
12,258,218 |
|
||
| Total current assets | 12,593,692 |
|
12,258,218 |
|
||||
| PROPERTY AND EQUIPMENT, NET | 862,977 |
|
328,504 |
|
||||
| OTHER ASSETS | ||||||||
| Other assets | 13,767 |
|
13,767 |
|
||||
| Operating lease right of use asset | 287,930 |
|
289,002 |
|
||||
| TOTAL ASSETS | $ |
13,758,366 |
|
$ |
12,889,491 |
|
||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| CURRENT LIABILITIES: | ||||||||
| Accounts payable - trade | $ |
526,968 |
|
$ |
419,093 |
|
||
| Accrued expenses | 462,940 |
|
893,137 |
|
||||
| Accrued expenses - related parties | 348,264 |
|
421,599 |
|
||||
| Convertible notes payable, net | 2,255,066 |
|
9,191,155 |
|
||||
| Current portion of operating lease right of use liability | 215,397 |
|
112,371 |
|
||||
| Total current liabilities | 3,808,635 |
|
11,037,355 |
|
||||
| NON-CURRENT LIABILITIES: | ||||||||
| Notes payable- PPP loans | - |
|
431,803 |
|
||||
| Operating lease right of use liability, net of current portion | 87,118 |
|
178,170 |
|
||||
| Total non-current liabilities | 87,118 |
|
609,973 |
|
||||
| COMMITMENTS AND CONTINGENCIES (Note 12) | - |
|
- |
|
||||
| STOCKHOLDERS' EQUITY | ||||||||
| Preferred stock - $0.001 par value, 5,000,000 shares authorized, Series C and D shares issued | ||||||||
| and outstanding as follows: | ||||||||
| Series C Convertible Preferred stock $0.001 par value, 1,785,715 shares authorized, | ||||||||
| 1,785,715 shares issued and outstanding at 9/30/2022 and 9/30/2021, respectively | 1,790 |
|
1,790 |
|
||||
| Series D Convertible Preferred stock $0.001 par value, 1,016,014 shares authorized, | ||||||||
| 1,016,004 shares issued and outstanding at 9/30/2022 and 9/30/2021, respectively | 1,015 |
|
1,015 |
|
||||
| Common stock - $0.001 par value, 200,000,000 shares authorized, 48,156,062 and 35,166,551 | ||||||||
| shares issued and outstanding at 9/30/2022 and 9/30/2021, respectively | 48,158 |
|
35,168 |
|
||||
| Additional paid in capital | 111,209,388 |
|
82,530,684 |
|
||||
| Accumulated deficit | (101,397,738 |
) |
(81,326,494 |
) |
||||
| Total stockholders' equity | 9,862,613 |
|
1,242,163 |
|
||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ |
13,758,366 |
|
$ |
12,889,491 |
|
||
Cash Flow:
| KNOWLABS, INC. AND SUBSIDIARIES | ||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||
| Years Ended, | ||||||||||
| September 30, 2022 | September 30, 2021 | |||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||||
| Net loss | $ |
(20,071,244 |
) |
$ |
(25,360,213 |
) |
||||
| Adjustments to reconcile net loss to net cash (used in) operating activities | ||||||||||
| Depreciation and amortization | 320,995 |
|
200,807 |
|
||||||
| Issuance of common stock for services | 183,000 |
|
202,820 |
|
||||||
| Issuance of common stock warrants for services | 451,487 |
|
2,547,436 |
|
||||||
| Gain on debt settlement | (268,872 |
) |
- |
|
||||||
| Stock based compensation- stock option grants | 4,421,634 |
|
1,028,522 |
|
||||||
| Right of use, net | 13,046 |
|
(1,493 |
) |
||||||
| Gain on forgiveness of notes payable - PPP loans | (252,700 |
) |
- |
|
||||||
| Amortization of debt discount to interest expense | 7,272,911 |
|
13,722,672 |
|
||||||
| Changes in operating assets and liabilities: | ||||||||||
| Other long-term assets | - |
|
11,413 |
|
||||||
| Accounts payable - trade and accrued expenses | 1,009,935 |
|
797,337 |
|
||||||
| NET CASH (USED IN) OPERATING ACTIVITIES | (6,919,808 |
) |
(6,850,699 |
) |
||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||||
| Purchase of research and development equipment | (855,468 |
) |
(299,525 |
) |
||||||
| NET CASH (USED IN) INVESTING ACTIVITIES: | (855,468 |
) |
(299,525 |
) |
||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||||
| Proceeds from issuance of common stock for NYSE uplisting | 8,280,000 |
|
- |
|
||||||
| Payments for stock issuance costs for NYSE uplisting | (855,321 |
) |
||||||||
| Proceeds from convertible notes payable | - |
|
14,209,000 |
|
||||||
| Payments for issuance costs from notes payable | - |
|
(727,117 |
) |
||||||
| Proceeds from Simple Agreements for Future Equity | - |
|
340,000 |
|
||||||
| Repayments on Simple Agreements for Future Equity | - |
|
(253,800 |
) |
||||||
| Proceeds from note payable - PPP | - |
|
205,633 |
|
||||||
| Repayments of notes payable- PPP | (179,103 |
) |
- |
|
||||||
| Proceeds from issuance of common stock for stock options exercise | 26,687 |
|
23,344 |
|
||||||
| Proceeds from issuance of common stock for warrant exercise | 838,487 |
|
1,313,203 |
|
||||||
| NET CASH PROVIDED BY FINANCING ACTIVITIES | 8,110,750 |
|
15,110,263 |
|
||||||
| NET INCREASE IN CASH AND CASH EQUIVALENTS | 335,474 |
|
7,960,039 |
|
||||||
| CASH AND CASH EQUIVALENTS, beginning of period | 12,258,218 |
|
4,298,179 |
|
||||||
| CASH AND CASH EQUIVALENTS, end of period | $ |
12,593,692 |
|
$ |
12,258,218 |
|
||||
| Supplemental disclosures of cash flow information: | ||||||||||
| Interest paid | $ |
- |
|
$ |
18,800 |
|
||||
| Taxes paid | $ |
- |
|
$ |
- |
|
||||
| Non-cash investing and financing activities: | ||||||||||
| Beneficial conversion feature | $ |
- |
|
$ |
9,769,683 |
|
||||
| Issuance of warrants to debt holders | $ |
- |
|
$ |
4,439,317 |
|
||||
| Issuance of warrants for services related to debt offering | $ |
- |
|
$ |
1,667,281 |
|
||||
| Cashless warrant exercise (fair value) | $ |
- |
|
$ |
515,975 |
|
||||
| Conversion of debt | $ |
14,209,000 |
|
$ |
5,638,275 |
|
||||
| Conversion of accrued interest | $ |
1,136,720 |
|
$ |
460,185 |
|
||||
| Issuance of shares and warrants for conversion of Simple Agreements for Future Equity | $ |
- |
|
$ |
1,427,141 |
|
||||
Conference Call:
Know Labs will host an audio webcast to discuss its results and provide a business update today, December 20, 2022, at 4:30pm 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=QSXwrYND
A copy of the form 10-K filed with the SEC can also be downloaded from the Company’s website. All holders, including stockholders and bondholders, can request and receive a hard copy of the complete audited financial statements free of charge. Requests must be submitted to ask@knowlabs.co.
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 U.S. Food and Drug Administration clearance prior to its introduction to the market.
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 U.S. Securities and Exchange Commission, including its Annual Report on Form 10-K for the fiscal year ended September 30, 2022, Forms 10-Q and 8-K, and in other filings we make with the Securities and Exchange Commission from time to time. These documents are available on the SEC Filings section of the Investor Relations section of our website at www.knowlabs.co. The Company cautions readers not to place undue reliance upon any such forward-looking statements, which speak only as of the date made. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made.
View source version on businesswire.com: https://www.businesswire.com/news/home/20221220005708/en/
Contacts
For Know Labs Media Inquiries Contact:
Linhart PR
Mallory West
mwest@linhartpr.com
Ph. (317) 439-3173
Know Labs, Inc. Contact:
Jordyn Hujar
jordyn@knowlabs.co
Ph. (206) 629-6414
