Couple of points about Q1 2021
Stayed silent until now but here are a few thoughts after looking at these statements for 15 mins:
**Income Statement**
* Yes, revenues are up, but gross margin (efficiency of revenue less direct costs) is actually down compared to Q1 2020;
* Product revenues are also down - Kai tests aren't selling;
* Even ignoring non-cash items (depreciation, impairment (yikes), share based payments), the loss from operations is almost quadrupled;
* Professional fee spend is absurd for a company of this size;
* Note 15 is really telling - $270k (22% of opex) is other expense? What even is that. $540k in salaries and benefits in one quarter? How big is their staff? What is that per FTE? Note 18 has info on how much exec's are getting paid...
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**Cash Flow & working cap**
* **$1.4M** cash burn in one quarter. $6.2M in cash at March 31. Do the math on the runway.
* $6.2M of cash and roughly the same amount of Trade AP and Debt. If they haven't burned through most of the cash already, I would their working cap ratio is well below 1.0
**General Notes**
* Note 2 corporate structure is an absolute mess;
* The company is way too complex for what it does, even throwing nearly $1M at professional advisors in a quarter can't make it clear;
* They are defaulting on all their leases (note 7; note 12) - how are they scaling up clinics?;
* Their acquisitions are not adding contribution margin or value
This Company is fast not a going concern (imminent bankruptcy) without further debt (already highly leveraged), or and equity raise.Do not let headlines of increase revenues in Q1 2021 to Q1 2020 fool you; this company has actually DECREASED in efficiency, with no clear indications that they can execute on the plans to sell Kai tests or scale the clinics.
\*\*EDIT - I'm getting a lot of DM's asking questions. I'm not sure why everyone is afraid to question management publicly in this sub.
\*\*EDIT 2.0 - Steve if you're reading this, definitely DM me.