PetVivo (PETV) - 2025 Q2 - Quarterly Report

PART I. FINANCIAL INFORMATION Financial Statements The unaudited consolidated financial statements reveal a net loss, a working capital deficit, and a significant going concern risk Consolidated Balance Sheets Total assets were $3.19 million and total liabilities were $2.78 million, with stockholders' equity decreasing due to net losses Consolidated Balance Sheet Highlights (Unaudited) | Balance Sheet Item | September 30, 2024 | March 31, 2024 | | :--- | :--- | :--- | | Total Current Assets | $1,246,384 | $1,041,660 | | Total Assets | $3,186,744 | $3,115,253 | | Total Current Liabilities | $1,858,017 | $1,412,370 | | Total Liabilities | $2,777,573 | $2,429,300 | | Total Stockholders' Equity | $409,171 | $685,953 | Consolidated Statements of Operations The company reported a lower net loss of $4.22 million for the six-month period, driven by reduced operating expenses Statement of Operations Summary (Unaudited) | Metric | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Six Months Ended Sep 30, 2024 | Six Months Ended Sep 30, 2023 | | :--- | :--- | :--- | :--- | :--- | | Revenues | $200,720 | $207,366 | $324,470 | $324,549 | | Gross Profit | $179,558 | $185,504 | $290,314 | $290,382 | | Operating Loss | ($2,173,040) | ($2,944,343) | ($4,217,473) | ($5,837,920) | | Net Loss | ($2,175,493) | ($3,661,153) | ($4,222,556) | ($6,554,730) | | Net Loss Per Share | ($0.11) | ($0.28) | ($0.22) | ($0.53) | Consolidated Statements of Cash Flows Net cash used in operations of $3.13 million was funded by $3.19 million in financing activities for the six-month period Cash Flow Summary for Six Months Ended September 30 (Unaudited) | Cash Flow Activity | 2024 | 2023 | | :--- | :--- | :--- | | Net Cash Used In Operating Activities | ($3,130,762) | ($4,604,962) | | Net Cash Used in Investing Activities | ($18,598) | ($93,618) | | Net Cash Provided by Financing Activities | $3,188,196 | $4,278,520 | | Net Increase (Decrease) in Cash | $38,836 | ($420,060) | | Cash at End of Period | $126,239 | $55,254 | Notes to Consolidated Financial Statements Key disclosures include business focus, revenue concentration, debt details, and substantial doubt about its going concern status - The company's business is licensing and commercializing medical devices for animals, with its lead product being Spryng™ for managing joint afflictions in dogs and horses[15] - For the six months ended September 30, 2024, revenue from the distribution agreement with MWI Veterinary Supply Co was $231,192, representing 68% of total revenues[40] - On September 9, 2024, the company entered into a convertible promissory note for $150,000 which was in default as of the filing date[79] - Management has substantial doubt about the Company's ability to continue as a going concern due to a net loss of $4.22 million for the six-month period, net cash used in operations of $3.13 million, and an accumulated deficit of $87.0 million[96] - Subsequent to the quarter end, the company raised $112,500 from selling restricted common shares and $200,000 from short-term notes[128] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses flat revenues, decreased net loss due to cost-cutting, and a critical liquidity situation Business Operations The company focuses on commercializing its Spryng™ product, supported by a key distribution agreement and clinical studies - The lead product, Spryng™, addresses the underlying causes of osteoarthritis in animals, such as cartilage deterioration, rather than just treating symptoms[133][136] - The company has an exclusive distribution agreement with MWI Veterinary Supply Co for its Spryng product in the United States[140] - A second ISO cleanroom facility is expected to be operational later in the year to help minimize supply risks and scale production capacity[143] Results of Operations Revenues remained flat while a significant decrease in operating expenses led to a smaller net loss year-over-year Operating Expense Comparison (Three Months Ended Sep 30) | Expense Category | 2024 | 2023 | Change | | :--- | :--- | :--- | :--- | | Sales and Marketing | $620,307 | $1,078,725 | -42.5% | | General and Administrative | $1,267,117 | $1,691,790 | -25.1% | | Research and Development | $465,174 | $359,332 | +29.5% | | Total Operating Expenses | $2,352,598 | $3,129,847 | -24.8% | Net Loss Comparison | Period | Net Loss 2024 | Net Loss 2023 | Change | | :--- | :--- | :--- | :--- | | Three Months Ended Sep 30 | ($2,175,493) | ($3,661,153) | -40.6% | | Six Months Ended Sep 30 | ($4,222,556) | ($6,554,730) | -35.6% | Liquidity and Capital Resources The company's critical liquidity is marked by a working capital deficit and reliance on external financing to continue operations - The company had a working capital deficit of $611,633 as of September 30, 2024[163] - For the six months ended September 30, 2024, net cash used in operating activities was $3.13 million, while net cash from financing activities was $3.19 million[167][168] - The company acknowledges it will need to raise additional capital to fund its business plan and that there is no guarantee it will be successful in doing so, reinforcing the going concern risk[166][173] Qualitative and Quantitative Disclosures About Market Risk As a smaller reporting company, PetVivo is not required to provide these disclosures - This disclosure is not required for the company[181] Controls and Procedures Disclosure controls and procedures were deemed effective, with no significant changes to internal controls during the quarter - Management concluded that disclosure controls and procedures were effective as of the end of the period covered by the report[183] - No significant changes were made to internal control over financial reporting during the second quarter ended September 30, 2024[184] PART II. OTHER INFORMATION Legal Proceedings The company is not involved in any material legal proceedings, referencing a settled matter with a former employee - The company refers to Note 9 regarding a legal contingency with a former employee, which was settled for $180,000 and paid in October 2023[94][186] Risk Factors The company refers investors to its Form 10-K for a comprehensive discussion of business risks - Investors are referred to the Risk Factors section of the company's Annual Report on Form 10-K for the fiscal year ended March 31, 2024[187] Unregistered Sales of Equity Securities and Use of Proceeds The company details numerous unregistered equity sales for services and capital, claimed as exempt from registration - In July 2024, the company issued 3,045,000 shares of series A convertible preferred stock for proceeds of $1,218,000[200] - In April and May 2024, the company sold 1,889,434 shares of common stock for proceeds of $1,322,600[199] - All described transactions were claimed as exempt from registration under Section 4(a)(2) of the Securities Act of 1933[202] Defaults Upon Senior Securities The company reports no defaults, which conflicts with a disclosure in the financial statement notes about a defaulted note - The company reports "None" for defaults upon senior securities[203] - This disclosure conflicts with Note 8 of the financial statements, which states that a promissory note from September 9, 2024, is in default[79] Other Information The company reports no other information for this item - None[203] Exhibits This section lists filed exhibits, including required CEO/CFO certifications and Inline XBRL data files - The report includes required certifications from the CEO and CFO pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act[204]