Kwesst Micro Systems Inc V.KWE

Question about financials

[Pyritetrap]

This stock was promoted on another board I followed.

Looked into it, but had questions about how they will finance the plan
The most recent financials say they have less than 200,000 cash.
I found this in the financials:

 

"The Company has financed its operations to date through the issuance of common shares. The Company continues to seek capital through various means including the issuance of equity and/or debt.

As disclosed in the “Description of Business” section of this MD&A, the Company closed its QT with KWESST on September 17, 2020. As part of the QT, the subscription receipts issued by KWESST on July 9, 2020 pursuant to a brokered private placement (the "KWESST Subscription Receipts"), were automatically converted, into shares

February 2019 was mainly due to the

 

of KWESST. The private placement which was completed through PI Financial Corp. as agent, consisted of 4,409,553 KWESST Subscription Receipts issued at $0.70 per subscription receipt for gross proceeds of approximately $3.1 million.

Following the completion of the QT, there were 41,266,821 shares of the Company outstanding, of which 40,367,678 were held by the former shareholders of KWESST (representing approximately 97.8% of the outstanding shares of KWESST) and 899,143 were held by the shareholders of Foremost prior to the QT."

Sounds like they need a lot of money they don't have so you can expect lots of shares to be issued -which dilutes existing shareholders 
I see here people saying they are undervalued ,  but they have no assets and no revenue so how can you compare in that basis?

ok so it's a pass for me -but maybe someone could explain the business case using math rather than just the story....

[Pyritetrap]

OK, so I did find an additional set of financials on Sedar. The numbers didn't make sense, because, with the share sales, they should've had several million dollars.   It turns out that you have to look at several of the documents, and put it together,because of the merger. Bottom line, from what I can tell, is that it's not as bad as I thought, it's actually a bit

[TMEvans]

Not sure what your angle is here, or if you really are looking for enlightenment, but if you look at the consolidated pro forma capitalization in Appendix I of the Filing Statement, filed in Early September, you'd see that at that time their net working capital was close to $5 million.  They've no doubt spent some money in the interim, but they have also received some new orders

[mjh9413]

I wud start by adding, one cannot read financials without reading the Notes. So, the Conv Debs have all been exchanged for shares as per their terms re: the QT. The larger amount was in current liabs simply because it was a short term liability whereas the 2019 deb was in long term liabs.) In additon the subscription dep is all share based payout, and finally the $40K loan is actually a $30K loan