Climaterock(CLRCU) - 2023 Q3 - Quarterly Report

PART I - FINANCIAL INFORMATION Item 1. Financial Statements Presents ClimateRock's unaudited financial statements, detailing financial position, performance, and cash flows for periods ended September 30, 2023, and December 31, 2022 Balance Sheets Total assets significantly decreased from $81.56 million to $28.02 million, primarily due to reduced trust account cash, while liabilities and shareholders' deficit increased Balance Sheet Highlights | Metric | Sep 30, 2023 (Unaudited) | Dec 31, 2022 | Change ($) | Change (%) | | :-------------------------- | :----------------------- | :----------- | :--------- | :--------- | | Total Assets | $28,022,595 | $81,557,355 | $(53,534,760) | -65.6% | | Cash & Cash Equivalents in Trust Account | $27,910,976 | $81,039,102 | $(53,128,126) | -65.6% | | Total Liabilities | $4,993,616 | $3,848,220 | $1,145,396 | 29.8% | | Shareholders' Deficit | $(4,881,997) | $(3,329,967) | $(1,552,030) | 46.6% | Statements of Operations The company reported net income for Q3 and 9M 2023, a significant improvement from prior year losses, primarily due to increased trust account income and reduced operating costs Statements of Operations Highlights | Metric | 3 Months Ended Sep 30, 2023 | 3 Months Ended Sep 30, 2022 (Restated) | 9 Months Ended Sep 30, 2023 | 9 Months Ended Sep 30, 2022 (Restated) | | :-------------------------- | :-------------------------- | :------------------------------------- | :-------------------------- | :------------------------------------- | | Formation and operating costs | $331,201 | $761,514 | $1,177,201 | $1,034,383 | | Net loss from operations | $(331,201) | $(761,514) | $(1,177,201) | $(1,034,383) | | Unrealized income on trust account | $357,678 | $353,596 | $1,762,208 | $440,326 | | Total other income | $357,729 | $353,596 | $1,762,379 | $440,326 | | Net income (loss) | $26,528 | $(407,918) | $585,178 | $(594,057) | | Basic and diluted earnings (loss) per share (Redeemable) | $0.11 | $(0.03) | $0.22 | $0.85 | | Basic and diluted earnings (loss) per share (Non-redeemable) | $(0.12) | $(0.08) | $(0.22) | $(2.16) | Statements of Changes in Shareholders' Deficit Accumulated deficit increased from $(3.33 million) to $(4.88 million), primarily due to adjustments for redeemable Class A shares and net income/loss, alongside Class B share conversions Shareholders' Deficit Changes (Jan 1, 2023 - Sep 30, 2023) | Metric | Jan 1, 2023 | Sep 30, 2023 | Change ($) | | :-------------------------- | :---------- | :----------- | :--------- | | Class A Ordinary Shares (Amount) | $12 | $209 | $197 | | Class B Ordinary Shares (Amount) | $197 | $0 | $(197) | | Accumulated Deficit | $(3,330,176) | $(4,882,206) | $(1,552,030) | | Total Shareholders' Deficit | $(3,329,967) | $(4,881,997) | $(1,552,030) | - Conversion of 1,968,749 Class B ordinary shares to Class A ordinary shares occurred during the nine months ended September 30, 2023[13] Statements of Cash Flows Net cash used in operations was $(972,788), investing provided $54.89 million, and financing used $(54.25 million), resulting in a net cash decrease of $(331,896) for the nine months ended September 30, 2023 Cash Flow Summary (Nine Months Ended September 30) | Activity | 2023 (Unaudited) | 2022 (Restated) | Change ($) | | :-------------------------- | :--------------- | :-------------- | :--------- | | Net cash used in operating activities | $(972,788) | $(632,368) | $(340,420) | | Net cash provided by (used in) investing activities | $54,890,334 | $(79,931,250) | $134,821,584 | | Net cash (used in) provided by financing activities | $(54,249,442) | $80,927,509 | $(135,176,951) | | Net (decrease) increase in cash | $(331,896) | $363,891 | $(695,787) | | Cash at end of period | $79,815 | $363,891 | $(284,076) | - A major cash outflow in financing activities for 2023 was $55,265,334 for the redemption of ordinary shares, which was not present in 2022[16] - Investing activities in 2023 were significantly positive due to $55,265,334 from sales of marketable securities in the trust account, contrasting with 2022's negative cash flow from depositing cash into the trust account for IPO sales[16] Notes to the Unaudited Financial Statements These notes provide detailed explanations of the company's organization, accounting policies, financial instruments, IPO, private placement, related party transactions, commitments, equity, and subsequent events NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS ClimateRock, a blank check company, completed its IPO and private placement in May 2022, raising $78.75 million and $3.76 million; the business combination deadline was extended to May 2, 2024, but a working capital deficit raises going concern doubts - ClimateRock is a blank check company (SPAC) incorporated on December 6, 2021, aiming for a business combination in climate change, renewable energy, and clean technologies[18] IPO and Private Placement Details (May 2, 2022) | Item | Amount | | :-------------------- | :------------ | | IPO Gross Proceeds | $78,750,000 | | Private Placement Warrants Gross Proceeds | $3,762,500 | | Funds placed in Trust Account | $79,931,250 | - The company's deadline to complete a business combination was extended to May 2, 2024, following a shareholder meeting on April 27, 2023[28] - As of September 30, 2023, the company had a working capital deficit of $2,519,497, raising substantial doubt about its ability to continue as a going concern[29] NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES This section outlines the company's accounting policies, including GAAP conformity, interim financial statement preparation, and restatement of prior period financials, along with policies for cash, trust account funds, redeemable shares, income taxes, and net income per share - Financial statements are prepared in accordance with U.S. GAAP and SEC rules, with prior period unaudited statements for Q3 2022 restated[30][31] - The company is an "emerging growth company" and has elected to use the extended transition period for complying with new or revised financial accounting standards, which may affect comparability with other public companies[38][39] - Class A ordinary shares subject to possible redemption are classified as temporary equity and adjusted to redemption value at each reporting period[42] - The company operates in the Cayman Islands, which imposes no income taxation, thus income taxes are not reflected in the financial statements[45] NOTE 3. INITIAL PUBLIC OFFERING On May 2, 2022, the company completed its IPO of 7,875,000 units at **$10.0