Zomedica (US:ZOM)2025-11-04 21:06Impairment Charges - The company reported a non-cash goodwill impairment charge of $45,555 for the three months ended March 31, 2025, due to its carrying amount exceeding fair value by approximately 163% for the PulseVet reporting unit and 128% for the Assisi reporting unit [139]. - The company recognized $8,297 in non-cash impairment charges related to amortizable intangible assets during the first quarter of 2025, with no impairment indicators identified for the third quarter of 2025 [140]. - A non-cash impairment charge of $1,981 related to property and equipment was recorded during the three months ended March 31, 2025, with no impairment indicators identified for the third quarter of 2025 [141]. - The company evaluates goodwill for impairment annually or when triggering events occur, with significant assumptions including financial projections and discount rates [135]. - The company uses a discounted cash flow method for estimating fair values of reporting units, considering various internal and external factors [136]. Revenue and Profitability - Revenue for the three months ended September 30, 2025 was $8,095, an increase of $1,098, or 16% compared to the same period in 2024 [152]. - Revenue for the nine months ended September 30, 2025 was $21,559, an increase of $2,169, or 11% compared to the same period in 2024 [152]. - Cost of revenue for the three months ended September 30, 2025 was $2,659, an increase of $722, or 37% compared to the same period in 2024 [154]. - Gross profit margin for the three months ended September 30, 2025 was 67%, down from 72% in the same period in 2024 [156]. - Net loss for the three months ended September 30, 2025 was $6,121, a decrease of $576, or 9% compared to the same period in 2024 [167]. Operating Expenses - Operating expenses consist of general and administrative, research and development, and selling and marketing expenses, with a focus on supporting business operations and product development [119]. - General and administrative expense for the three months ended September 30, 2025 was $5,900, a decrease of $865, or 13% compared to the same period in 2024 [158]. - Research and development expense for the nine months ended September 30, 2025 was $5,523, an increase of $401, or 8% compared to the same period in 2024 [161]. - Selling and marketing expense for the three months ended September 30, 2025 was $4,358, an increase of $468, or 12% compared to the same period in 2024 [163]. Cash Flow and Financial Position - Cash used in operating activities for the nine months ended September 30, 2025 was $16,750, a decrease of $2,355, or 12% compared to the same period in 2024 [170]. - As of September 30, 2025, the company had an accumulated deficit of $295,243 [173]. - The company's long-term cash requirements are expected to be sufficient to fund operational needs beyond the next twelve months [176]. - The company's long-term cash requirements have not changed materially since the 2024 Form 10-K [179]. Taxation - Deferred tax assets for U.S. federal income tax purposes amount to $20,005, with non-capital loss carryforwards for Canada at $6,419, expiring in fiscal year 2035 [180]. - The company derecognized $3,814 of U.S. federal income tax net operating loss carryforwards, reducing the carryforward to $16,191 [180]. - The One Big Beautiful Bill Act enacted on July 4, 2025, had an immaterial impact on the company's income tax provision [181]. Climate Change Impact - Increased public awareness of climate change may lead to more stringent requirements for reducing greenhouse gas emissions and shifting to sustainable energy sources [182]. - The potential impact of climate change on operations remains uncertain, with risks including changes in rainfall patterns and increased operating costs [183]. - Climate change may indirectly increase resource prices and affect the demand and availability of property and casualty insurance [183]. Business Development and Future Capital Requirements - The company's future capital requirements will depend on various factors, including development costs and expenses related to being a public company [177]. - Ongoing business development activities may require liquidity and additional capital for newly acquired operations [176].