Forafric PLC(AFRI) - 2024 Q2 - Quarterly Report

Condensed Consolidated Financial Statements This section presents the company's financial position, operational performance, equity changes, and cash flows for the interim period Condensed Consolidated Balance Sheets The company's total assets decreased from $309,450 thousand at December 31, 2023, to $287,122 thousand at June 30, 2024, primarily driven by a decrease in cash and cash equivalents and prepaid expenses. Total liabilities also decreased, while stockholders' equity saw a significant reduction | Metric | June 30, 2024 ($k) | December 31, 2023 ($k) | | :-------------------------------- | :------------------- | :--------------------- | | Total Assets | 287,122 | 309,450 | | Cash and cash equivalents | 16,368 | 24,021 | | Total Current Liabilities | 245,281 | 253,259 | | Total Stockholders' Equity | 16,310 | 29,206 | Condensed Consolidated Statements of Operations and Comprehensive Loss For the six months ended June 30, 2024, the company reported increased revenues but also a higher net loss compared to the same period in 2023, primarily due to increased cost of sales and selling, general and administrative expenses | Metric | Six months ended June 30, 2024 ($k) | Six months ended June 30, 2023 ($k) | | :----------------------------------- | :---------------------------------- | :---------------------------------- | | Revenues | 165,238 | 145,616 | | Cost of sales | 146,520 | 131,969 | | Gross profit | 18,718 | 13,647 | | Operating loss | (3,609) | (1,377) | | Net loss attributable to the Company | (12,756) | (8,622) | | Loss per ordinary shares outstanding | (0.45) | (0.32) | Condensed Consolidated Statements of Changes in Stockholders' Equity Stockholders' equity decreased significantly from $29,206 thousand at January 1, 2024, to $16,310 thousand at June 30, 2024, mainly due to the net loss attributable to the Company and foreign exchange loss | Metric | June 30, 2024 ($k) | January 1, 2024 ($k) | | :------------------------- | :----------------- | :----------------- | | Total Stockholders' Equity | 16,310 | 29,206 | | Net (loss) income | (12,756) | - | | Foreign exchange loss | (794) | - | Condensed Consolidated Statements of Cash Flows Net cash provided by operating activities increased to $13,390 thousand for the six months ended June 30, 2024, compared to $10,492 thousand in the prior year. However, net cash used in financing activities significantly increased, leading to a net decrease in cash and cash equivalents | Cash Flow Activity | Six months ended June 30, 2024 ($k) | Six months ended June 30, 2023 ($k) | | :----------------------------------- | :---------------------------------- | :---------------------------------- | | Net cash provided by operating activities | 13,390 | 10,492 | | Net cash used in investing activities | (664) | (4,187) | | Net cash used in financing activities | (20,099) | (3,685) | | Net (decrease) increase in cash and cash equivalents | (7,653) | 328 | | Cash and cash equivalents, end of period | 16,368 | 25,155 | Notes to Condensed Consolidated Financial Statements This section provides detailed explanations of the company's accounting policies, financial instrument valuations, lease obligations, debt, equity, and segment performance 1. Nature of Operations and Basis of Presentation Forafric Global PLC is a market leader in the Moroccan milling industry, offering a comprehensive range of products including flours, semolina, pasta, couscous, rice, and starches. The condensed consolidated financial statements are prepared in accordance with US GAAP for interim financial information, including all necessary recurring adjustments Nature of Operations - Forafric Global PLC is a market leader in the milling industry in Morocco, offering flours, semolina, pasta, couscous, rice, and starches[13] Basis of Presentation - The financial statements are prepared in accordance with US GAAP for interim financial information, including all necessary recurring adjustments[16] - Results for the six months ended June 30, 2024, and 2023 are not necessarily indicative of full-year operating results[16] 2. Summary of Significant Accounting Policies The company applies consistent accounting policies with its annual report, utilizing estimates and assumptions in financial statement preparation. Key policies include principles of consolidation, share-based compensation valuation using Black-Scholes, foreign currency translation, and fair value measurements classified under a three-level hierarchy. The company also maintains its Emerging Growth Company status, allowing for an extended transition period for new accounting standards, and management has assessed its ability to continue as a going concern for at least the next twelve months Use of Estimates - Management uses judgment to make estimates and assumptions affecting reported amounts, including allowance for credit losses, valuation of goodwill and intangible assets, useful lives of long-lived assets, and income tax assets[18] Principles of Consolidation - The condensed consolidated financial statements include all entities controlled by the Company, with intercompany accounts and transactions eliminated[19] Share-Based Compensation - Share-based awards (stock options and phantom options) are measured at grant date fair value (Black-Scholes model) and expensed over the vesting period[21][22] - Phantom options are accounted for as liability awards and re-measured at fair value each reporting period[21] Foreign Currency Translation and Transactions - The Company's functional currency is the Moroccan dirham (MAD), and its presentation currency is the United States Dollar (USD)[23] - Translation adjustments are deferred as a separate component of equity in 'Accumulated other comprehensive income'[23] Credit Risk - Financial instruments subject to credit risk include cash and cash equivalents and trade accounts receivable. Management believes the company is not exposed to significant credit risk from depository institutions[24] Foreign Currency Forward Contracts - The company uses foreign currency forward contracts to manage exchange rate fluctuations, which are recorded on the balance sheet at fair value, with changes recognized in current period earnings as they are not designated as hedging instruments[25] Fair Value Measurements - The company follows ASC 820 for fair value measurements, maximizing observable inputs (Level 1 and 2) and minimizing unobservable inputs (Level 3)[26][29] - Derivative liabilities/assets from foreign currency forward contracts and contingent consideration liability are measured at fair value on a recurring basis[28] Emerging Growth Company Status - The company is an Emerging Growth Company (EGC) and has elected to use the extended transition period for adopting new or revised accounting standards under the JOBS Act[30] Reclassifications - Certain prior period amounts have been reclassified to conform to the current period presentation[31] Liquidity and Going Concern - Management has assessed the company's ability to continue as a going concern for at least the next twelve months from the issuance date of the financial statements[32] - Considerations include $12,802 thousand in cash and cash equivalents as of December 31, 2024 (projected), a binding agreement for the sale of a subsidiary for $10,000 thousand, and active pursuit of additional financing[33][39] 3. Recently Adopted Accounting Pronouncements The company is currently evaluating the impact of two new FASB ASUs: ASU 2023-07 on Segment Reporting, effective for fiscal years beginning after December 15, 2023, and ASU 2023-09 on Income Tax Disclosures, effective for annual periods beginning after December 15, 2024 - The company is evaluating the impact of ASU 2023-07 (Segment Reporting) and will adopt it for the year ended December 31, 2024[34] - The company is determining the impact of ASU 2023-09 (Income Taxes) which is effective for annual periods beginning after December 15, 2024[35] 4. Leases The company holds operating and finance leases for real estate, vehicles, equipment, and construction land. Total lease liabilities decreased from $4,467 thousand at December 31, 2023, to $3,864 thousand at June 30, 2024. The weighted-average discount rates are 5.0% for operating leases and 6.6% for finance leases as of June 30, 2024 Supplemental Balance Sheet Information | Metric | June 30, 2024 ($k) | December 31, 2023 ($k) | | :-------------------- | :------------------- | :--------------------- | | Total Right-of-use assets | 13,015 | 13,385 | | Total Lease Liabilities | 3,864 | 4,467 | Discount Rates | Lease Type | June 30, 2024 | December 31, 2023 | | :----------- | :------------ | :---------------- | | Operating leases | 5.0% | 5.0% | | Finance leases | 6.6% | 7.0% | Lease Payments - Lease payments under options to extend or terminate are included in the measurement of right-of-use assets and lease liabilities when reasonably certain to be exercised[43] Weighted-Average Remaining Lease Term | Lease Type | June 30, 2024 | December 31, 2023 | | :----------- | :------------ | :---------------- | | Operating leases | 6.6 years | 6.5 years | | Finance leases | 0.9 years | 1.4 years | Components of Lease Expense | Lease Cost Component | Six months ended June 30, 2024 ($k) | Six months ended June 30, 2023 ($k) | | :--------------------- | :---------------------------------- | :---------------------------------- | | Operating lease cost | 328 | 246 | | Finance lease cost: Amortization of right-of-use assets | 279 | 242 | | Finance lease cost: Interest on lease liabilities | 50 | 36 | | Total lease cost | 657 | 524 | Future Maturities of Lease Liabilities | Year | Operating Leases (in thousands) | Finance Leases (in thousands) | | :---------------- | :------------------------------ | :---------------------------- | | Remainder of 2024 | 400 | 506 | | 2025 | 665 | 497 | | 2026 | 625 | 98 | | 2027 | 591 | 68 | | 2028 | 179 | 26 | | Thereafter | 1,123 | - | | Total lease payments | 3,583 | 1,195 | | Less: Interest | (869) | (45) | | Present value of lease liabilities | 2,714 | 1,150 | Other Lease Information | Cash Flow Type | Six months ended June 30, 2024 ($k) | Six months ended June 30, 2023 ($k) | | :------------------------------------------ | :---------------------------------- | :---------------------------------- | | Operating cash flows used for operating leases | 328 | 246 | | Operating cash flows for finance leases | 279 | 242 | | Financing cash flows for finance leases | 50 | 36 | 5. Accounts Receivable, Net Net accounts receivable increased to $36,271 thousand at June 30, 2024, from $34,716 thousand at December 31, 2023, with the allowance for credit losses also increasing | Metric | June 30, 2024 ($k) | December 31, 2023 ($k) | | :------------------------ | :------------------- | :--------------------- | | Accounts receivable | 51,603 | 49,695 | | Allowance for credit losses | (15,332) | (14,979) | | Total | 36,271 | 34,716 | - Current period provision for expected credit losses was $(419) thousand for the six months ended June 30, 2024[47] 6. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets significantly decreased to $8,692 thousand at June 30, 2024, from $15,654 thousand at December 31, 2023, primarily due to a reduction in value-added tax receivable, prepaid income taxes, and the absence of insurance recoveries | Asset Type | June 30, 2024 ($k) | December 31, 2023 ($k) | | :-------------------------- | :------------------- | :--------------------- | | Value-added tax receivable | 800 | 1,547 | | Prepaid income taxes | 2,524 | 3,165 | | Advances to suppliers | 3,542 | 3,696 | | Prepaid expenses | 951 | 643 | | Insurance recoveries | - | 4,984 | | Other current assets | 875 | 1,619 | | Total | 8,692 | 15,654 | 7. Inventories Total inventories remained relatively stable at $28,663 thousand at June 30, 2024, compared to $28,378 thousand at December 31, 2023, with no inventory reserves reported for either period | Inventory Type | June 30, 2024 ($k) | December 31, 2023 ($k) | | :-------------------------- | :------------------- | :--------------------- | | Merchandise | 777 | 874 | | Raw materials and consumable supplies | 23,845 | 22,821 | | Finished Goods | 4,041 | 4,683 | | Total | 28,663 | 28,378 | - The Company has no inventory reserves as of June 30, 2024, and December 31, 2023[49] 8. Property, Plant and Equipment, Net Net property, plant, and equipment decreased slightly to $114,028 thousand at June 30, 2024, from $116,920 thousand at December 31, 2023. Depreciation expense for the six months ended June 30, 2024, was $2,108 thousand | Asset Type | June 30, 2024 ($k) | December 31, 2023 ($k) | | :-------------------------- | :------------------- | :--------------------- | | Land | 25,191 | 25,389 | | Buildings | 63,278 | 63,200 | | Machinery and equipment | 65,760 | 63,284 | | Assets in progress | 6,753 | 10,354 | | Others | 9,409 | 9,393 | | Total | 170,391 | 171,620 | | Less accumulated depreciation | (56,363) | (54,700) | | Total | 114,028 | 116,920 | | Metric | Six months ended June 30, 2024 ($k) | Six months ended June 30, 2023 ($k) | | :------------------ | :---------------------------------- | :---------------------------------- | | Depreciation expense | 2,108 | 2,009 | 9. Goodwill and Other Intangible Assets Goodwill decreased slightly to $48,009 thousand at June 30, 2024, from $48,488 thousand at December 31, 2023, primarily due to foreign currency exchange adjustments. Total intangible assets also decreased to $4,496 thousand from $4,648 thousand over the same period, with a weighted-average remaining amortization period of 8.8 years | Metric | June 30, 2024 ($k) | December 31, 2023 ($k) | | :-------------------- | :------------------- | :--------------------- | | Total Goodwill | 48,009 | 48,488 | | Total Intangible Assets | 4,496 | 4,648 | - Goodwill decreased due to foreign currency exchange adjustments of $(479) thousand for the six months ended June 30, 2024[51] - The weighted-average remaining amortization period for intangibles other than goodwill is 8.8 years as of June 30, 2024, with future amortization expected to total $3,552 thousand[52] 10. Accrued Expenses Accrued expenses increased to $18,823 thousand at June 30, 2024, from $18,115 thousand at December 31, 2023, mainly driven by an increase in consideration payable to selling stockholder and accrued government taxes | Accrued Expense Type | June 30, 2024 ($k) | December 31, 2023 ($k) | | :-------------------------- | :------------------- | :--------------------- | | Consideration payable to selling stockholder | 9,159 | 8,840 | | Accrued government taxes | 5,821 | 5,580 | | Accrued interest | 2,158 | 2,047 | | Accrued salaries and benefits | 662 | 657 | | Accruals to social agencies | 507 | 669 | | Other accrued expenses | 516 | 322 | | Total | 18,823 | 18,115 | 11. Lines of Credit The company utilizes unsecured revolving credit agreements for working capital and asset-based credit facilities for wheat raw material purchases. Working capital lines of credit increased to $52,858 thousand at June 30, 2024, from $48,517 thousand at December 31, 2023, while wheat inventory lines of credit decreased Working Capital Lines of Credit - The company has unsecured revolving credit agreements for working capital up to approximately $53,000 thousand, with interest rates ranging from 5.6% to 7.5%[54] | Metric | June 30, 2024 ($k) | December 31, 2023 ($k) | | :-------------------------- | :------------------- | :--------------------- | | Lines of credit – working capital | 52,858 | 48,517 | Wheat Inventories Lines of Credit - The company has asset-based credit facilities for wheat raw material purchases up to approximately $135,000 thousand, secured by inventory, with interest rates ranging from 2.75% to 7.5%[55] | Metric | June 30, 2024 ($k) | December 31, 2023 ($k) | | :-------------------------- | :------------------- | :--------------------- | | Lines of credit – wheat inventories | 104,639 | 126,452 | 12. Long-Term Debt Total outstanding debt decreased to $18,441 thousand at June 30, 2024, from $22,312 thousand at December 31, 2023. This includes term loans and lease obligations, with maturities extending through 2034 | Metric | June 30, 2024 ($k) | December 31, 2023 ($k) | | :-------------------- | :------------------- | :--------------------- | | Total outstanding debt | 18,441 | 22,312 | | Total long-term debt (net of current portion) | 10,585 | 11,841 | Term Loans - The company maintains unsecured term loans with fixed monthly payments and interest rates ranging from 5.5%-9.0% per annum, maturing through 2034[57] Lease Obligations | Metric | June 30, 2024 ($k) | December 31, 2023 ($k) | | :--------------- | :------------------- | :--------------------- | | Lease obligations | 3,864 | 4,467 | - Lease obligations are payable in monthly installments of principal and interest and are collateralized by the related assets financed[58] Scheduled Maturities | Year | Total outstanding debt (in thousands) | | :---------------- | :---------------------------------- | | Remainder of 2024 | 5,763 | | 2025 | 4,112 | | 2026 | 3,022 | | 2027 | 2,431 | | 2028 | 969 | | Thereafter | 2,144 | | Total outstanding debt | 18,441 | 13. Foreign Currency Forward Contracts The company uses foreign currency forward contracts to manage exchange rate fluctuations, not designating them as hedging instruments. As of June 30, 2024, there were 18 contracts outstanding with a notional value of $15,200 thousand and €17,500 thousand ($18,800 thousand), all expiring by December 31, 2024. A loss of $552 thousand was recorded for the six months ended June 30, 2024 - The company had 18 foreign currency forward contracts outstanding as of June 30, 2024, with a notional value of $15,200 thousand and €17,500 thousand ($18,800 thousand equivalent)[61] - All outstanding contracts will expire by December 31, 2024, and are presented within current liabilities[61] | Metric | Six months ended June 30, 2024 ($k) | Six months ended June 30, 2023 ($k) | | :------------------------------------ | :---------------------------------- | :---------------------------------- | | Loss on foreign exchange forward contracts | 552 | 1,614 | 14. Contingent Consideration Liability The contingent consideration liability, related to warrant exercises, decreased to $1,061 thousand at June 30, 2024, from $1,326 thousand at December 31, 2023. The fair value is determined using a Level 3 probability-weighted scenario-based model | Metric | June 30, 2024 ($k) | December 31, 2023 ($k) | | :------------------------------ | :------------------- | :--------------------- | | Contingent consideration liability | 1,061 | 1,326 | - The fair value of the contingent consideration is determined using a Level 3 probability-weighted scenario-based model, with a change in fair value of $(265) thousand for the six months ended June 30, 2024[66][68] 15. Income Taxes Income tax expense increased to $1,696 thousand for the six months ended June 30, 2024, from $646 thousand in the prior year. The effective tax rate was -16% for 2024, lower than the Moroccan statutory rate due to unrecognized tax losses and minimum contribution. The company maintains a valuation allowance on deferred tax assets | Metric | Six months ended June 30, 2024 ($k) | Six months ended June 30, 2023 ($k) | | :------------------ | :---------------------------------- | :---------------------------------- | | Total income tax expense | 1,696 | 646 | - The effective tax rate was -16% for the six months ended June 30, 2024, compared to -8% in 2023, primarily due to unrecognized tax losses and minimum contribution[70] | Metric | June 30, 2024 ($k) | December 31, 2023 ($k) | | :-------------------------------- | :------------------- | :--------------------- | | Cumulative net operating losses | 45,199 | 37,228 | | Valuation allowance on deferred tax assets | 5,993 | 5,172 | 16. Stockholders' Equity The company has authorized Preferred Shares and Ordinary Shares, with 26,879,202 Ordinary Shares issued and outstanding. All Class Z Ordinary Shares were repurchased and retired in 2023. There are 11,461,120 public warrants and 4,289,722 private warrants outstanding, exercisable at $11.50 per share. Stockholder Earn-Out Rights exist for additional Ordinary Shares based on Adjusted EBITDA and Buyer Trading Price targets through 2024, with no Earnout Shares issued as of June 31, 2024 Capital Stock - The company is authorized to issue 1,000,000 Preferred Shares and 100,000,000 Ordinary Shares[74][75] - As of June 30, 2024, 26,879,202 Ordinary Shares were issued and outstanding[75] - All 30,000,000 authorized Class Z Ordinary Shares were repurchased and retired during 2023[76] Warrants - There were 11,461,120 public warrants and 4,289,722 private warrants outstanding as of June 30, 2024, each entitling the holder to purchase one ordinary share at $11.50 per share[77][79] - Public warrants may be redeemed by the company if the Ordinary Share price equals or exceeds $16.50 for 20 trading days within a 30-day period[77] Stockholder Earn-Out Rights - The selling stockholder is entitled to receive up to 2,000,000 additional Ordinary Shares (Earnout Shares) based on Adjusted EBITDA targets for 2022/2023 and a Buyer Trading Price target for 2024[80] - As of June 31, 2024, no Earnout Shares have been issued[80] 17. Equity Incentive Plan The Forafric 2022 Long Term Employee Share Incentive Plan allows for grants of nominal cost options or phantom options, with a maximum of 10% of issued share capital reserved. As of June 30, 2024, 64,705 stock options and 53,613 phantom options were outstanding, with unrecognized compensation expenses of $407 thousand and $325 thousand, respectively, to be recognized over 18 months - The Equity Incentive Plan reserves a maximum of 10% of the company's issued share capital (not exceeding 2,645,684 shares) for awards[82] | Metric | Stock Options (June 30, 2024) | Phantom Options (June 30, 2024) | | :------------------------------------ | :---------------------------- | :------------------------------ | | Outstanding | 64,705 | 53,613 | | Weighted Average Exercise Price | $0.001 | $0.001 | | Unrecognized Compensation Expense ($k) | 407 | 325 | | Recognition Period | 18 months | 18 months | 18. Earnings Per Share Basic and diluted loss per share were $(0.45) for the six months ended June 30, 2024, compared to $(0.32) for the same period in 2023. The computation excludes earnout, option shares, and warrants due to their anti-dilutive effect | Metric | Six months ended June 30, 2024 | Six months ended June 30, 2023 | | :------------------------------------ | :----------------------------- | :----------------------------- | | Loss per ordinary shares outstanding – basic and diluted | $(0.45) | $(0.32) | | Weighted average number of shares outstanding | 26,879,202 | 26,879,114 | - The computation of diluted loss per share excludes the effect of earnout, option shares, and warrants because their inclusion would be anti-dilutive[89] 19. Commitments and Contingencies The company faces ongoing litigation incidental to its business but expects no material effect on financial statements. It has a five-year supply agreement with Millcorp for at least 80% of annual wheat requirements, amended to extend through March 2026. The war in Ukraine has impacted raw material prices but not caused shortages or affected firm commitments - The company has a five-year supply agreement with Millcorp Geneva SA, obligating it to obtain at least 80% of its annual common wheat, durum wheat, or other cereal requirements, extended through March 2026[91] | Metric | Six months ended June 30, 2024 ($k) | Six months ended June 30, 2023 ($k) | | :----------------------- | :---------------------------------- | :---------------------------------- | | Purchases from Millcorp | 53,994 | 97,641 | - The war in Ukraine has decreased soft wheat availability and increased raw material prices, but the company has not experienced shortages and does not project issues fulfilling future orders[90] - The company has provided collateral and mortgages to banks totaling $25,464 thousand as of June 30, 2024[92] - No lawsuits or other proceedings are expected to have a material effect on the condensed consolidated financial statements at June 30, 2024[94] 20. Segment Information The company manages operations on a company-wide basis but reports three segments: Soft Wheat, Durum Wheat, and Couscous & Pasta, plus "All others." Total sales to external customers increased to $165,238 thousand for the six months ended June 30, 2024, from $145,616 thousand in 2023, with Soft Wheat being the largest contributor. The company reported an overall operating loss of $(3,609) thousand for the period. Approximately 15.9% of net sales were from customers outside Morocco Reportable Segments Overview - The company's reportable segments are Soft Wheat (flour for desserts/sauces), Durum Wheat (flour for pasta), and Couscous and Pasta (secondary processed products)[96][97] Financial Information by Segment | Segment | Sales to external customers (Six months ended June 30, 2024, $k) | Sales to external customers (Six months ended June 30, 2023, $k) | | :---------------- | :------------------------------------------------------- | :------------------------------------------------------- | | Soft Wheat | 122,408 | 104,124 | | Durum Wheat | 26,012 | 24,980 | | Couscous & Pasta | 14,894 | 14,591 | | All others | 1,924 | 1,921 | | Total | 165,238 | 145,616 | | Segment | Direct Operating (loss) income (Six months ended June 30, 2024, $k) | Direct Operating (loss) income (Six months ended June 30, 2023, $k) | | :---------------- | :---------------------------------------------------------- | :---------------------------------------------------------- | | Soft Wheat | 729 | 2,340 | | Durum Wheat | (595) | 504 | | Couscous & Pasta | (827) | (384) | | All others | (2,916) | (3,837) | | Operating loss | (3,609) | (1,377) | Geographic Information - Net sales from customers outside Morocco accounted for approximately 15.9% of total consolidated net sales for the six months ended June 30, 2024 (10.4% in Mali, 3.4% in Burkina, and 2.1% in other countries)[100] | Country | Long-lived assets (June 30, 2024, $k) | Long-lived assets (December 31, 2023, $k) | | :-------- | :------------------------------------ | :---------------------------------------- | | Morocco | 93,998 | 96,149 | | Burkina | 8,567 | 8,913 | | Mali | 6,697 | 6,991 | | Angola | 4,294 | 4,396 | | Other | 472 | 471 | | Total | 114,028 | 116,920 | 21. Related Parties The company has ongoing related party transactions, including a building lease agreement with a parent-owned entity, and a supply agreement with Millcorp. Amounts due from related parties were $1,379 thousand and due to related parties were $1,504 thousand as of June 30, 2024. Share-based compensation of $250 thousand was recognized for non-executive directors - The company has a building lease agreement for its headquarters with a parent-owned subsidiary, with total rent of approximately $420 thousand per year through 2024[102] - The supply agreement with Millcorp (a related party) resulted in purchases of $53,994 thousand for the six months ended June 30, 2024, and accounts payable due to Millcorp of $13,362 thousand as of June 30, 2024[103] | Metric | June 30, 2024 ($k) | December 31, 2023 ($k) | | :-------------------------- | :------------------- | :--------------------- | | Amounts due from related parties | 1,379 | 1,358 | | Amounts due to related parties | 1,504 | 1,486 | - Share-based compensation expense of $250 thousand was recognized for non-executive members of the board of directors for the period ended June 30, 2024[104] 22. Subsequent Events Subsequent events include the grant of additional phantom options to new directors on August 8, 2024, a Nasdaq delinquency notification on January 14, 2025, for failure to file interim financial statements, and a binding agreement on January 15, 2025, for the sale of a wholly-owned subsidiary for $10,000 thousand - On August 8, 2024, the company granted 3,700 additional cash-settled stock options (phantom options) to new directors[107] - On January 14, 2025, Nasdaq notified the company of non-compliance for failing to file its interim financial statements for the period ended June 30, 2024, by the December 31, 2024 deadline[108] - On January 15, 2025, the company entered into a binding agreement for the sale of a wholly-owned subsidiary to a third party for total consideration of $10,000 thousand[109]