March 31, 2024 December 31, 2022
Current assets Cash and cash equivalents 341,242 8,934,913
M&A Nothing we don't already know
Still no cereal crunch
During the fifteen months ended March 31, 2024, the Company halted Nexalogy operations as a cost reduction measure as management is currently focusing on the Imagine Health Centres.
Imagine Health Imagine Health is currently in the final stages of opening a third clinic in Vancouver, while management reviews the possibility of opening a fourth clinic in Ontario. To further solidify its position as a leading provider of innovative healthcare solutions, the Company will be incorporating a Wellness Centre into its two (2) existing clinics which further expands services that offer physiotherapy, IV Vitamin Therapy treatment, acupuncture, and much more.
Operating Expenses & Other Items
For the fifteen months ended March 31, 2024, the Company incurred $14,352,982 of operating expenses (twelve months ended December 31, 2022: $12,596,099). Certain significant items are noted below:
• Depreciation and amortization of $3,752,098 (twelve months ended December 31, 2022: $2,791,878) relating to the Company’s property and equipment, intangible assets, and right-of-use assets. The increase is primarily driven by the intangible assets from Imagine Health
. • Share based compensation of $1,318,192 (twelve months ended December 31, 2022: $Nil) due to the issuance of 29.5 million stock options in June 2023 and 5 million stock options in August 2023.
• Salaries, benefits, and consulting fees of $3,625,980 (twelve months ended December 31, 20222: $3,928,731) related to building out new businesses, including Imagine Health and new AI driven businesses.
• Office and general of $2,476,235 (twelve months ended December 31, 2022: $1,871,097) includes office supplies, office maintenance, insurance, travel expenses, marketing costs and allowance for expected credit losses. The costs increased as the costs for COVID-19 businesses decreased slightly offset by an increase in office costs at dmEVS and Imagine Health. The Company continues to work towards decreasing costs for operating efficiencies.
• Professional fees of $2,544,874 (twelve months ended December 31, 2022: $3,232,037) due to various consulting services related to dmEVS and Imagine Health. The Company anticipates that the professional fees will be lower than previous periods due to the sale of the dmEVS to New World.
• The Company holds marketable securities in Justera and New World. The investments are measured at fair value, with the change recognized in profit or loss. During the fifteen months ended March 31, 2024, the Company recorded an unrealized gain on its marketable securities of $1,416,029 (twelve months ended December 31, 2022: unrealized loss of $2,456,839) and a realized loss on sale of marketable securities of $1,084,591 (twelve months ended December 31, 2022: $940) related to the disposal of 4,144,937 New World shares for proceeds of $241,783 (twelve months ended December 31, 2022: $Nil).
• Impairment of intangible assets and goodwill of $10,575,450 (twelve months ended December 31, 2022: $6,745,317) due to the Company completely writing down the trademarks, developed technologies, other intangible assets and goodwill of Nexalogy and Medi-Call operations due to a combination of not generating expected revenues and management shifting focus to other business ventures.
• Loss on deconsolidation of $2,574,937 (twelve months ended December 31, 2022: $Nil) related to the sale of dmEVS to New World for an aggregate purchase price of up to $3,750,000, contingent upon dmEVS achieving certain milestones.
In February 2024, the Company closed a financing for $1 million to be used for working capital purposes
. Nexalogy’s contract with the Canadian government continues to provide cash in 2023 and the Company continues to obtain IT related contracts both in Canada and in Korea
. The acquisitions of dmEVS and Imagine Health are complete and Imagine Health started to add revenues and cash flows almost immediately without any significant additional capital expenditures. At March 31, 2024, the Company had $2.5 million already advanced to Imagine Health and no further capital expenditure is required. In connection with the purchase of Imagine Health, the Company issued a secured vendor take-back note with a principal amount of $800,000 payable in installments of 6, 12 and 18 months from the date of issuance. $266,667 was paid in May 2023 and $533,333 remain outstanding as of the date of this MD&A.
dmEVS was sold to New World for further liq uidity and to better focus on the health care businesses.
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astuteinon Jul 31, 2024 10:09am