Crown(US:CRKN)2024-08-14 13:28Financial Performance - Revenue for the three months ended June 30, 2024, was $4.6 million, a significant increase from $37,000 in the same period in 2023, driven by new contracts with subcontractors [94]. - Cost of revenue for the three months ended June 30, 2024, was $4.0 million, up from $23,000 in 2023, primarily due to increases in subcontractor labor and equipment costs [95]. - Net loss for the three months ended June 30, 2024, was $5.0 million, a decrease from a net loss of $14.5 million in the same period in 2023 [93]. - The company experienced a total revenue increase of $5.2 million for the six months ended June 30, 2024, compared to the same period in 2023, attributed to new contracts [94]. - For the six months ended June 30, 2024, the company reported a net loss of $9.6 million, with an accumulated deficit of approximately $126.6 million [110]. - Total other income (expense) for the three months ended June 30, 2024, was $(121,000), a notable improvement from $(9.6 million) in 2023, reflecting better financial management [93]. Expenses - Research and development expenses rose to $1.1 million for the three months ended June 30, 2024, compared to $0.5 million in 2023, mainly due to higher salaries and benefits [98]. - General and administrative expenses decreased to $4.2 million for the three months ended June 30, 2024, from $4.3 million in 2023, attributed to lower professional fees and insurance expenses [99]. - Interest expense significantly decreased to $0.1 million for the three months ended June 30, 2024, from $2.5 million in 2023, due to reduced amortization of deferred assets [100]. - Net cash used in operating activities for the six months ended June 30, 2024 was $8.9 million, compared to $8.4 million for the same period in 2023 [110]. - Net cash used in investing activities for the six months ended June 30, 2024 was approximately $0.1 million, a decrease from $1.4 million in the same period in 2023 [111]. Cash Flow and Financing - The company had cash at the end of the period of $3.99 million, a significant increase from $36,000 at the end of June 30, 2023 [110]. - Net cash provided by financing activities for the six months ended June 30, 2024 was $11.8 million, an increase from $8.9 million in the same period in 2023 [113]. - The company raised approximately $10.7 million from the sale of 1,739,958 shares of common stock at a weighted average price of $6.93 per share [108]. Internal Controls and Compliance - The company noted material weaknesses in internal controls over financial reporting, including lack of documentation and inadequate design of IT controls [126]. - The company has assessed its internal control over financial reporting as of June 30, 2024, and concluded that the controls were not effective due to material weaknesses identified [126]. - Material weaknesses include lack of documentation of processes, inadequate design of IT controls, lack of segregation of duties, and ineffective risk assessment controls [126]. - The company maintains that unethical or inaccurate conduct damages stakeholder interests and is committed to improving internal controls [127]. - There were no changes in internal control over financial reporting during the quarter ended June 30, 2024, that materially affected the controls [128]. Going Concern and Legal Matters - There is substantial doubt about the company's ability to continue as a going concern for twelve months from the issuance of the financial statements due to uncertainty in raising capital [109]. - The company is involved in various legal claims but does not expect these to materially affect its financial position or operations [130].