Revenue Performance - Revenue for the three months ended March 31, 2023, was $811,711, an increase of approximately $51,931 or 7% compared to $759,780 in the same period of the prior year[93]. - The B2B sales program comprises 50% of total revenue, indicating significant growth since its introduction in 2004[83]. - The company expects an improvement in revenues in fiscal 2023 as the COVID-19 pandemic appears to be abating[84]. Cost Management - Cost of revenues decreased to $94,877 during the three months ended March 31, 2023, compared to $100,565 during the same period in 2022, with a percentage of revenue decrease from 13% to 12%[95]. - Selling, general and administrative expenses were $1,116,020 for the three months ended March 31, 2023, a decrease of $320,575 from $1,436,595 in the same period of 2022[98]. - For the three months ended March 31, 2023, net cash used in operating activities was $350,814, a decrease from $431,356 in the same period of 2022, indicating improved cash flow management[107][109]. Financial Condition - The company incurred a net loss of $424,916 for the three months ended March 31, 2023, compared to a net income of $272,081 for the same period in 2022[102]. - Management has expressed substantial doubt about the company's ability to continue as a going concern due to operating losses and negative cash flows[89]. - Inflationary pressures and geopolitical conflicts have resulted in increased costs for labor, fuel, and materials, potentially impacting the company's financial condition[85]. Cash Position - The company had cash of $755,478 available to fund operations as of March 31, 2023, following a net proceeds of approximately $1.88 million from a private placement[86]. - As of March 31, 2023, the company had cash on hand amounting to $755,478 and received net proceeds of approximately $1.88 million from the sale of 937,500 shares at $2.00 per share[105]. Debt Obligations - The total principal balance of convertible debt assumed upon the reverse merger was $20,000, with accrued interest of $17,887 as of March 31, 2023[113]. - Economic Injury Disaster Loans (EIDL) had a principal balance of $657,274 and accrued interest of $45,615 as of March 31, 2023, reflecting ongoing financial obligations[116][118]. - The company made principal payments of $12,675 during the three months ended March 31, 2023, reducing the aggregate principal balance of notes payable to $115,103[115]. - The company’s total principal and accrued interest for government assistance notes payable was $702,889 as of March 31, 2023, slightly down from $706,576 at the end of 2022[116]. Operational Focus - There were no investing activities reported for the three months ended March 31, 2023, indicating a focus on operational cash flow management[111]. - The company’s future operations depend on its ability to secure necessary debt or equity financing to continue until it generates positive cash flow[105].
RDE Inc(RSTN) - 2023 Q1 - Quarterly Report