Connexa(US:CNXA)2025-12-23 22:29Revenue and Profit - Revenue for the six months ended October 31, 2025, was $6.0 million, a decrease of $0.5 million or 8% compared to $6.5 million for the same period in 2024[155] - Gross profit for the six months ended October 31, 2025, was $4.5 million, down 11% from $5.1 million in the prior year[154] Expenses and Financial Position - General and administrative expenses increased by $2.2 million, from $0.3 million to $2.5 million for the six months ended October 31, 2025, primarily due to costs associated with YYEM becoming a Nasdaq-listed company[158] - The company had working capital of $156.0 million as of October 31, 2025, an increase of approximately $140.5 million or 884% from $15.9 million as of April 30, 2025[159] - Cash and cash equivalents increased by about $105.45 million, from $0.05 million as of April 30, 2025, to $105.5 million as of October 31, 2025[160] Financing Activities - The company signed a $500 million joint venture agreement to form AiRWA Exchange, a digital asset exchange focused on the tokenization of real-world assets[143] - The company completed a private placement on August 19, 2025, raising gross proceeds of $4.6 million by issuing 20,000,000 units[146] - Cash flow provided by financing activities rose by approximately $173.3 million for the six months ended October 31, 2025, due to private placement proceeds and funds raised under the ATM facility[163] Acquisitions and Investments - The company entered into a share purchase agreement to acquire the remaining 30% of YYEM for $36 million[149] Operating Activities - Net cash used in operating activities was $31.9 million for the six months ended October 31, 2025, compared to $0.2 million of net cash provided by operating activities for the same period in the prior year[160] Accounting Policies and Standards - The Company adopted ASC 326 on June 30, 2022, to estimate credit losses based on expected losses rather than incurred losses[170] - As of October 31, 2025, the Company had made no reserves for credit losses, indicating a stable collection environment[171] - The impairment charge for long-lived assets for the six months ended October 31, 2025, was nil, suggesting no significant adverse changes in market conditions[172] - Revenue is recognized when performance obligations are satisfied, following the five-step process outlined in ASC 606[174] - Accounts receivable are recorded when obligations have been performed, with terms typically providing net 90-day terms[176] - Royalty income is recognized over time as the Company's technology rights are utilized by customers, reflecting ongoing revenue generation[177] - The Company has adopted ASC 740 for income taxes, recognizing deferred tax assets and liabilities based on temporary differences[178] - The Company does not expect recent accounting pronouncements to materially impact its financial position or results of operations[181] - The Company is currently evaluating the impact of several new accounting standards, including ASU 2024-03 and ASU 2025-01, but does not anticipate significant effects[182][184] - The Company has not recognized any impairment losses for long-lived assets, indicating effective asset management and valuation practices[172]