FINANCIALS ! I OWED 3.5 MILL. SHARES I OWE 0 NOW !!GOOD LUCK Calyx Ventures Inc.
(Formerly Calyx Bio-Ventures Inc.)
Condensed Interim Consolidated Financial Statements
(UNAUDITED - EXPRESSED IN CANADIAN DOLLARS)
For the three and six months ended
June 30, 2018 and 2017
2
NOTE TO READER
Under National Instrument 51-102, if an auditor has not performed a review of condensed interim consolidated financial statements they must be accompanied by a note indicating that the condensed interim consolidated financial statements have not been reviewed by an auditor.
The accompanying unaudited condensed consolidated interim financial statements have been prepared by and are the responsibility of the management. The Corporation’s independent auditor has not performed a review of these condensed interim consolidated financial statements.
CALYX VENTURES INC.
(Formerly Calyx Bio-Ventures Inc.)
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(Unaudited – Expressed in Canadian Dollars)
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
3
As at
June 30,
2018
December 31,
2017
ASSETS
Current
Cash
$ 677,152
$ 393,676
Receivables (Note 4)
70,657
63,791
Digital currencies (Note 5)
106,832
34,048
Prepaid expenses and deposits
37,712
50,931
892,353
542,446
Non-current assets
Equipment (Note 6)
755,661
777,004
Intangible assets
893,733
913,733
Total Assets
$ 2,541,747
$ 2,233,183
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current
Accounts payable and accrued liabilities
$ 633,217
$ 553,278
Promissory note
-
52,000
633,217
605,278
Non-current liabilities
Unearned revenue
-
5,500
Total Liabilities
633,217
610,778
Shareholders’ Equity
Capital stock (Note 7)
10,547,858
9,847,088
Subscriptions received (Note 7)
-
28,750
Reserves (Note 7)
2,763,656
2,763,656
Deficit
(11,402,984)
(11,017,087)
1,908,530
1,622,407
Total Liabilities and Shareholders’ Equity
$ 2,541,747
$ 2,233,183
Nature and Continuance of Operations (Note 1)
Approved and authorized for issue by the Board of Directors
“Roger Forde”
Director
“Gavin McMillan”
Director
Roger Forde
Gavin McMillan
CALYX VENTURES INC.
(Formerly Calyx Bio-Ventures Inc.)
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS
(Unaudited – Expressed in Canadian Dollars)
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
4
Three months ended
Six months ended
June 30, 2018
June 30, 2017
June 30, 2018
June 30, 2017
REVENUE
$ 109,395
$ 41,550
$ 182,330
$ 57,450
COST OF SALES
(35,785)
(9,750)
(61,144)
(19,500)
GROSS PROFIT
73,610
31,800
121,186
37,950
OPERATING EXPENSES
Depreciation (Note 6)
65,691
1,020
123,705
2,040 Depreciation of intangible assets
10,000
33,675
20,000
67,349 Development expenses
4,838
24,498
37,678
47,643
Payroll costs
-
-
1,262
- Personnel costs
34,740
57,000
74,940
102,025
Professional and regulatory
73,436
39,994
154,324
49,160
Investor relations
3,500
2,515
12,352
8,845 Office and administrative
44,509
19,166
60,517
51,466
(236,714)
(177,868)
(484,778)
(328,528)
OTHER INCOME (EXPENSES)
Other income
200
-
200
-
Accretion
-
(2,509)
-
(4,948)
Foreign exchange gain
114
-
114
319
Changes in fair value of digital currency
(15,313)
-
(22,617)
-
(14,999)
(2,509)
(22,303)
(4,629)
Net and comprehensive loss for the period
$ (178,103)
$ (148,577)
$ (385,895)
$ (295,207)
Basic and diluted loss per common share
$ (0.00)
$ (0.00)
$ (0.00)
$ (0.00)
Weighted average number of common shares outstanding
85,597,999
64,328,045
85,097,260
62,864,419
CALYX VENTURES INC.
(Formerly Calyx Bio-Ventures Inc.)
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited – Expressed in Canadian Dollars)
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
5
Six months ended
June 30, 2018
Six months ended
June 30, 2017
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss for the period
$ (385,895)
$ (295,207)
Items not affecting cash:
Depreciation (Note 6)
123,705
2,040
Depreciation of intangible assets (Note 6)
20,000
67,349
Accretion
-
4,948
Digital currency revaluation
22,617
-
Changes in working capital items relating to operations:
Receivables
(6,866)
(35,983)
Digital currencies
(95,401)
-
Prepaid expenses and deposits
13,219
12,423
Accounts payable and accrued liabilities
79,939
(7,930)
Unearned revenue
(5,500)
-
Net cash flows used in operating activities
(234,182)
(252,360)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of equipment (Note 6)
(102,362)
(19,531)
Net cash flows used in investing activities
(102,362)
(19,531)
CASH FLOWS FROM FINANCING ACTIVITIES
Repayment of promissory note
(52,000)
-
Subscriptions received (Note 7)
672,020
117,000
Net cash flows provided from financing activities
620,020
117,000
Change in cash during the period
283,476
(154,891)
Cash, beginning of period
393,676
188,657
Cash, end of period
$ 677,152
$ 33,766
CALYX VENTURES INC.
(Formerly Calyx Bio-Ventures Inc.)
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(Unaudited – Expressed in Canadian Dollars)
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
6
Capital Stock
Number
Amount
Subscriptions Received
Contributed Surplus
Deficit
Total
Balance as at December 31, 2016
61,384,529
$ 7,680,624
$ -
$ 2,570,076
$ (9,564,759)
$ 685,941
Subscriptions received
-
-
117,000
-
-
117,000
Shares issued for intangible assets
4,540,000
340,500
-
-
340,500
Loss for the period
-
-
-
-
(292,207)
(292,207)
Balance as at June 30, 2017
62,924,529
$ 8,021,124
$ 117,000
$ 2,570,076
$ (9,856,966)
$ 851,234
Balance as at December 31, 2017
85,045,958
$ 9,847,088
$ 28,750
$ 2,763,656
$ (11,017,089)
$ 1,622,405
Shares issued for cash
9,285,700
650,000
-
-
-
650,000
Share issue costs - cash
-
(980)
-
-
-
(980)
Options exercised
450,000
51,750
(28,750)
-
-
23,000
Loss for the period
-
-
-
-
(385,895)
(385,895)
Balance as at June 30, 2018
94,781,658
$ 10,547,858
$ -
$ 2,763,656
$ 11,402,984
$ 1,908,530
CALYX BIO-VENTURES INC.
(Formerly Calyx Bio-Ventures Inc.)
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017
(Unaudited – Expressed in Canadian Dollars)
7
1. NATURE AND CONTINUANCE OF OPERATIONS
Calyx Ventures Inc. (formerly Calyx Bio-Ventures Inc.) (the “Company”) was incorporated under the Business Corporations Act (British Columbia) on June 10, 2008. The registered address of the Company is located at 2200 – 885 West Georgia Street, Vancouver, BC, V6C 3E8.
On February 4, 2018 the Company changed its name to Calyx Ventures Inc.
The Company, through its wholly owned subsidiaries, is in the business of bringing technology solutions to advanced indoor agriculture, including mining of digital currencies.
Through its wholly owned subsidiary, Cannigistics Agri-Solutions Corp. (“Cannigistics”), the Company is in the business of bringing technology solutions to advanced indoor agriculture.
Through its wholly owned subsidiary, Canada Blockchain Hosting Corp. (“CBH”), the Company is in the business of digital currencies, many aspects of which are not specifically addressed by current IFRS guidance. The Company is required to make judgements as to its accounting policies under IAS 8. The Company has disclosed its presentation, recognition and derecognition, and measurement of digital currencies, and the recognition of revenue as well as significant assumptions and judgements, however, if specific guidance is enacted by the IASB in the future, the impact may result in changes to the Company’s earnings and financial position as presented.
Going concern
These condensed interim consolidated financial statements have been prepared on a going concern basis of presentation, which assumes that the Company will continue operations for the foreseeable future and be able to realize the carrying value of its assets and discharge its liabilities and commitments in the normal course of business. To date, the Company has not earned significant revenue and has an accumulated deficit of $11,402,984. The Company’s ability to continue as a going concern is dependent upon its ability to obtain additional financing and/or achieve profitable operations in the future.
These condensed interim consolidated financial statements do not reflect adjustments that would be necessary if the going concern assumption was not appropriate. These adjustments could be material. The Company's financing efforts to date, while substantial, are not sufficient in and of themselves to enable the Company to fund all aspects of its operations. Management will pursue funding initiatives if, as and when required to meet the Company's requirements on an ongoing basis. Nevertheless, there is no assurance that these initiatives will be successful or sufficient.
There is no assurance that the Company will be able to obtain adequate financing in the future or that such financing will be on terms advantageous to the Company. These circumstances comprise a material uncertainty which may cast significant doubt as to the ability of the Company to meet its obligations as they fall due and, accordingly, the ultimate appropriateness of the use of accounting principles applicable to a going concern.
2. BASIS OF PRESENTATION
Basis of presentation
The consolidated financial statements of the Company have been prepared in accordance with IFRS as issued by the International Accounting Standards Board (“IASB”) and Interpretations of the International Financial Reporting Interpretations Committee (“IFRIC”). The consolidated financial statements have been prepared on an accrual basis and are based on historical costs, modified where applicable. The consolidated financial statements are presented in Canadian dollars unless otherwise noted.
CALYX BIO-VENTURES INC.
(Formerly Calyx Bio-Ventures Inc.)
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017
(Unaudited – Expressed in Canadian Dollars)
8
2. BASIS OF PRESENTATION (CONTINUED)
Statement of compliance
These condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standards (“IAS”) 34 “Interim Financial Reporting” (“IAS 34”) using accounting policies consistent with the International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board (“IASB”) and interpretations of the International Financial Reporting Interpretations Committee (“IFRIC”). Accordingly, certain disclosures required in annual financial statements have been condensed or omitted. These Condensed Consolidated Interim Financial Statements are intended to provide users with an update in relation to events and transactions that are significant to an understanding of the changes in financial position and performance of the Company since the end of the last annual reporting period. It is therefore recommended that these Condensed Consolidated Interim Financial Statements be read in conjunction with the most recent audited annual consolidated financial statements of the Company for the year ended December 31, 2017 available on sedar.com on April 30, 2018.
The condensed interim consolidated financial statements have been prepared on a historical cost basis, except for financial instruments classified as financial instruments at fair value through profit and loss, which are stated at their fair value. In addition, these condensed interim consolidated financial statements have been prepared using the accrual basis of accounting, except for cash flow information.
The condensed interim consolidated financial statements were authorized for issue by the Board of Directors on August 29, 2018.
3. SIGNIFICANT ACCOUNTING POLICIES
The accounting policies followed by the Company are set out in Note 3 to the audited consolidated financial statements for the year ended December 31, 2017 and have been consistently followed in the preparation of these consolidated condensed interim financial statements except as disclosed below.
4. CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS
There have been no material revisions to the nature and amount of changes in estimates of amounts reported in the annual financial statements 2017.
CALYX BIO-VENTURES INC.
(Formerly Calyx Bio-Ventures Inc.)
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017
(Unaudited – Expressed in Canadian Dollars)
9
5. BASIS OF FAIR VALUE
The Company’s financial instruments consist of cash, receivables, digital currencies, accounts payable and accrued liabilities, and promissory notes. The fair value of the Company’s other receivables, accounts payable and loans payable to related parties approximate the carrying value, which is the amount on the consolidated statements of financial position due to their short-term maturities or ability of prompt liquidation. The Company’s cash, is measured at fair value under the fair market hierarchy, based on level one quoted prices in active markets for identical assets.
Financial instruments that are measured subsequent to initial recognition at fair value are grouped in Levels 1 to 3 based on the degree to which the fair value is observable:
- Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities; and
- Level 2 fair value measurements are those derived from inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and
- Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable marker data (unobservable inputs).
The following table sets forth the Company’s financial instruments measured at fair value on a recurring basis by level within the fair value hierarchy as at June 30, 2018:
Level 1
Level 2
Level 3
Cash
$
677,152
$
-
$
-
Digital currencies
106,832
-
-
$
783,984
$
-
$
-
Digital currencies are recorded at their fair value on the date they are received as revenues and are revalued to their current market value at each reporting date. Fair value is determined by taking the hourly volume weighted average price (per the Central European Time zone) from www.cryptocompare.com.
June 30, 2018
December 31, 2017
Bitcoin
$ 91,313
$ 13,336
Ethereum
15,519
20,712
$ 106,832
$ 34,048
6. EQUIPMENT
The Company’s equipment was as follows:
Computer Equipment
Balance December 31, 2016
$ 12,436
Additions
781,568
Depreciation for the period
(17,000)
Balance December 31, 2017
777,004
Additions
102,362
Depreciation for the period
(123,705)
Balance June 30, 2018
$ 755,661
CALYX BIO-VENTURES INC.
(Formerly Calyx Bio-Ventures Inc.)
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017
(Unaudited – Expressed in Canadian Dollars)
10
7. SHAREHOLDERS’ EQUITY
Capital Stock
Issued and outstanding shares
In June 2018, the Company issued 9,285,700 common shares at $0.07 from a non-brokered private placement for gross proceeds of $650,000. Each Unit consists of one common share of the Company, and one-half-of-one common share purchase warrant (each whole warrant, a “Warrant”). Each Warrant is exercisable to acquire one additional common share of the Company at a price of $0.15 per share for a period of twelve months. There were no proceeds allocated to the warrants in the private placement and, in connection with the private placement, the Company incurred share issue costs of $980 cash paid and issued 14,000 share purchase warrants.
In January 2018, the Company issued 200,000 common shares at $0.115 from the exercise of options for gross proceeds of $23,000.
In January 2018, the Company issued 250,000 common shares at $0.115 from the exercise of options for gross proceeds of $28,750.
Common share purchase warrants
Common share purchase warrant transactions are summarized as follows:
Number of
Stock Options
Weighted Average
Exercise Price
Balance, December 31, 2016
2,857,929
$ 0.15
Issued
7,428,571
0.15
Exercised
(3,014,286)
0.15
Balance, December 31, 2017
7,272,214
$ 0.15
Issued
4,656,850
0.15
Balance, June 30, 2018
11,929,064
0.15
As at June 30, 2018, the outstanding share purchase warrants were as follows:
Number of Warrants
Exercise Price
Expiry Date
543,643
$ 0.15
October 28, 2018
6,728,571
$ 0.15
November 10, 2019
4,656,850
$ 0.15
June 28, 2019
11,929,064
Stock options
Stock option transactions are summarized as follows:
Number of
Stock Options
Weighted Average
Exercise Price
Balance, December 31, 2016
2,600,000
$ 0.115
Exercised
(1,250,000)
0.115
Granted
1,650,000
0.210
Balance, December 31, 2017
3,000,000
$ 0.167
Exercised
(450,000)
0.115
Balance, June 30, 2018
2,550,000
0.176
CALYX BIO-VENTURES INC.
(Formerly Calyx Bio-Ventures Inc.)
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017
(Unaudited – Expressed in Canadian Dollars)
11
7. SHAREHOLDERS’ EQUITY (CONTINUED)
As at June 30, 2018, the following stock options were outstanding:
Expiry Date
Weighted Average
Exercise Price
Number of
Options
Weighted Average Remaining Contractual Life in Years
October 24, 2021
$ 0.115
900,000
3.32
November 19, 2022
$ 0.210
1,650,000
4.39
$ 0.167
2,550,000
4.02
8. RELATED PARTY TRANSACTIONS
a) Transactions:
Key management personnel include directors and senior management members. The Company paid or accrued the following amounts to key management personnel or companies controlled by them:
Six months
June 30, 2018
Six months
June 30, 2017
Management fees
$ 78,000
$ 66,000
During the six months ended June 30, 2018, the Company reimbursed a company controlled by an officer $27,000 (2017 – $9,750) for cloud hosting costs incurred on behalf of the Company.
As at June 30, 2018, accounts payable and accrued liabilities include $261,504 owed to the CEO, a company controlled by the CEO and a director (December 31, 2017 – 53,218). Amounts due to related parties are unsecured, have no fixed repayments and are non-interest bearing.
b) Due to (receivable from) related parties:
Six months
June 30, 2018
Six months
June 30, 2017
Personnel costs
$ 6,000
$ -
Professional fees
103,598
-
Office expense reimbursements
-
-
Loans
261,504
-
$ 371,102
$ -
Amounts due to related parties are unsecured, have no fixed repayments and are non-interest bearing.