ViewBix Inc(US:VBIX)2024-08-14 21:04Financial Performance - Revenues for the three months ended June 30, 2024, were $7,333 thousand, a decrease of 73% compared to $27,154 thousand during the same period in the prior year [187]. - Revenues from Cortex's Content Platform were $6,218 thousand for the three months ended June 30, 2024, a decrease of 70.5% from $21,312 thousand in the prior year, primarily due to the Cortex Adverse Effect [188]. - Revenues from Gix Media's Search Platform were $1,115 thousand for the three months ended June 30, 2024, a decrease of 80.7% from $5,842 thousand in the prior year, attributed to reduced search referrals and decreased credit lines from partners [189]. - Total revenues for the six months ended June 30, 2024, were $17,335 thousand, a decrease of 64.1% from $48,016 thousand in the prior year [198]. - Revenues from Cortex's Content Platform for the six months ended June 30, 2024, were $13,748 thousand, a decrease of 63% from $37,064 thousand in the prior year [199]. - Positive cash flow from operating activities for the six months ended June 30, 2024, was $1,456 thousand, resulting from a net loss of $9,374 thousand and positive adjustments of $8,761 thousand [216]. - The company experienced a decline in revenues from digital content and search segments, raising substantial doubts about its ability to continue as a going concern during the next 12 months [221][222]. Expenses and Financial Position - Selling and marketing expenses were $1,111 thousand for the six months ended June 30, 2024, a decrease of 22.7% from $1,438 thousand in the prior year [203]. - General and administrative expenses were $1,302 thousand for the six months ended June 30, 2024, a slight decrease from $1,392 thousand in the prior year [204]. - Research and development expenses were $1,262 thousand for the six months ended June 30, 2024, down 16.6% from $1,513 thousand in the prior year [202]. - Net financial expenses rose to $2,907 thousand for the six months ended June 30, 2024, up from $431 thousand in the prior year, mainly due to financing expenses from the June 2024 Credit Facility [207]. - Current assets as of June 30, 2024, totaled $11,362 thousand, including $609 thousand in cash and cash equivalents and $6,073 thousand in accounts receivable [209]. - Current liabilities as of June 30, 2024, amounted to $15,502 thousand, with $8,797 thousand in accounts payable and $4,439 thousand in short-term loans [211]. - The company reported a negative working capital of $4,140 thousand as of June 30, 2024, compared to a negative working capital of $1,968 thousand as of December 31, 2023 [215]. Financing Activities - The Company entered into a Loan Agreement on November 15, 2023, providing $480,000, potentially increasing to $1,000,000, with a 9% annual interest rate [143]. - The June 2024 Credit Facility amounts to $1 million, with an additional $530,657 of outstanding debt included, and a 12% annual interest rate [145]. - The First July 2024 Credit Facility provides a $2.5 million loan with a 12% annual interest rate, with a drawdown schedule including $50,000 upon effectiveness and $200,000 quarterly thereafter [158][161]. - The Second July 2024 Credit Facility offers a $3.0 million loan, also at a 12% interest rate, with an initial drawdown of $80,000 and subsequent monthly drawdowns until exhausted [165][168]. - The company is required to file a registration statement with the SEC for the resale of shares related to both the First and Second July 2024 Credit Facilities, filed on July 31, 2024 [164][171]. Shareholder Actions - The Company approved a one-for-four consolidation of its share capital, pending FINRA approval [129]. - A reverse stock split of 1-for-4 was executed, reducing the outstanding shares from 18,839,686 to approximately 4,709,922 shares, effective July 15, 2024 [174]. - The Company issued 2023 Warrants to lenders, allowing them to purchase shares at an exercise price of $0.50, expiring on December 31, 2025 [144]. - The June 2024 Facility Warrants are exercisable at $0.25 per share, with a three-year term from issuance [149]. - The June 2024 Lead Lender Fee Warrant was adjusted to an exercise price of $0.118, allowing for the issuance of 21,186,440 shares, totaling an aggregate exercise amount of $2.5 million [151]. - The Private Placement closed on July 3, 2024, raising gross proceeds of $256,875 from the sale of 1,027,500 shares and warrants for an additional 1,541,250 shares at a price of $0.25 per unit [155]. - The company issued 480,000 shares of common stock as partial compensation to consultants under new consulting agreements [173]. Strategic Initiatives and Risks - The Company aims to expand its digital advertising operations through its subsidiaries, focusing on ad search and digital content [134]. - The Company anticipates potential risks from competition, technological obsolescence, and geopolitical conditions affecting operations [130]. - The Company has a substantial doubt regarding its ability to continue as a going concern, necessitating additional capital [130]. - Management's response to financial challenges included salary reductions, operational expense cuts, and the creation of new partnerships to generate income [223]. - Gix Media is in compliance with financial covenants related to the Financing Agreement as of June 30, 2024 [220].