Foresight(FRSX) - 2022 Q4 - Annual Report

Financial Performance - The operating loss for the year ended December 31, 2022, was approximately $17,455,000, an increase of $1,510,000 or 9.5% from the operating loss of $15,945,000 in 2021[360] - The net loss for the year ended December 31, 2022, was approximately $21,676,000, compared to a net loss of $15,036,000 in 2021, marking an increase of $6,640,000[363] Expenses - Research and development expenses for the year ended December 31, 2022, amounted to $11,534,000, an increase of $1,364,000 or 13.4% compared to $10,170,000 in 2021[349] - Sales and marketing expenses for the year ended December 31, 2022, were approximately $2,230,000, representing an increase of $382,000 or 20.7% compared to $1,848,000 in 2021[358] - General and administrative expenses for the year ended December 31, 2022, were approximately $3,989,000, slightly up from $3,980,000 in 2021[359] Cash Flow - Cash and cash equivalents, including restricted cash and short-term bank deposits, were approximately $26.5 million as of December 31, 2022[366] - Net cash used in operating activities for the year ended December 31, 2022, was approximately $17,057,000, compared to $12,125,000 in 2021[368] - Net cash provided by investing activities for the year ended December 31, 2022, was approximately $8,983,000, primarily from changes in short-term deposits[370] - The company expects existing cash and equivalents to fund operations through the second quarter of 2024[376] Losses and Revenue - The company has incurred losses and generated negative cash flows from operations since January 2011, with no significant revenue from product sales expected in the near term[375] Share Options - The company granted options to purchase 13,075,000 Ordinary Shares during 2022, subject to specific terms and conditions[387] - The fair value of share options is estimated using a Black-Scholes Merton options pricing model, which relies on several key assumptions[387] - The expected volatility for share options is calculated based on historical Ordinary Shares price movements[387] Currency and Market Risks - Changes of 5% and 10% in the U.S. dollar/NIS exchange rate would increase/decrease operating expenses for 2022 by 0.65% and 1.3%, respectively[607] - The majority of the company's liquid assets are held in NIS, with a portion of expenses denominated in U.S. dollars[607] - The company does not currently hedge its foreign currency exchange risk but may consider formal currency hedging transactions in the future[608] - The company is exposed to market risks primarily due to changes in foreign currency exchange rates and interest rates[606] - The percentage of NIS denominated expenses is expected to materially decrease in the near future, reducing exposure to exchange rate fluctuations[607] Investment Policy - The company's investment policy involves holding cash in bank deposits with banks rated at least A-minus, with most cash and cash equivalents bearing interest[606] Dividends - The company has historically not paid dividends and has no foreseeable plans to issue dividends[387]