IMT(US:IMTE)2022-04-28 15:12Financial Performance - As of December 31, 2021, the company had an accumulated deficit of A$37,169,358 and recorded a loss of A$6,585,626 for the year, primarily due to a decline in sales of 3D display products impacted by the pandemic[32]. - The company acknowledges the uncertainty surrounding its ability to achieve profitability and the potential need for further funding to sustain operations[33]. - Economic conditions, including the impact of COVID-19, have negatively affected consumer discretionary spending, which is correlated with the company's revenues[90]. - Currency fluctuations have negatively impacted the company, leading to foreign exchange losses in 2021[130]. - The Australian dollar has appreciated against the U.S. dollar, which may affect costs and revenues sourced from the U.S. and other jurisdictions[130]. Business Strategy and Operations - The company has ceased sales of its 3D display products to reduce overhead costs and is expanding into electronic glass, nano-coated plate air filters, air purifiers, halal certification, and a digital asset exchange[32]. - The company anticipates requiring additional financing to support its operations and new business ventures, including the capital-intensive lamination operation for switchable glass[38]. - The company plans to continue seeking new acquisition opportunities to enhance its operations and growth prospects[45]. - The company has shifted its business focus from 3D display products to laminated switchable glass, nano-coated plate filters, and IoT products due to the adverse effects of the pandemic on retail and advertising sectors[206]. Capital and Financing - The company is exploring various means of raising additional capital, including joint ventures and debt or equity financing, which may dilute existing shareholders[40]. - The company may issue additional securities in the future, which could result in dilution to existing shareholders[173]. - The company may need to raise additional funds through equity offerings, which could further dilute existing shareholders' ownership[174]. - The company has never paid dividends and does not intend to do so in the foreseeable future, meaning shareholders may not receive any return on their investment from dividends[177]. Market and Competition - The company faces significant competition in its nano-coated plate filter, switchable glass, halal products, and digital assets marketplace, which may adversely affect its business and financial condition[46]. - The halal products market is highly competitive, with many competitors having significantly greater resources, which could impact the company's market position[86]. - The company faces competition from both local and foreign competitors, which may lead to competitive pricing and lower profit margins[103]. - The company faces significant competition in technology and product development, which may render its products obsolete if it cannot keep pace[146]. Risks and Challenges - The company has faced significant operational challenges due to COVID-19, including travel restrictions and supply chain disruptions, which have adversely affected sales activities[36]. - The ongoing military conflict between Russia and Ukraine poses risks that could adversely affect the global economy and the company's business operations[25]. - The company is monitoring geopolitical risks and their potential impact on its business, including increased costs and disruptions in supply chains[30]. - The company may face challenges in negotiating collaborative arrangements or strategic alliances, which are crucial for the development and commercialization of its products[52]. - Unforeseen events, including natural disasters and public health issues, could disrupt operations and adversely affect operating results[106]. Intellectual Property and Regulatory Issues - Intellectual property infringement claims could be costly and time-consuming, potentially harming the company's ability to provide existing services[53]. - The company may face challenges in enforcing its intellectual property rights, which could adversely affect its business and financial condition[151]. - The company must comply with local building codes for its switchable glass products, and failure to do so may impair marketability and sales[118]. - Changes in government legislation and policy may adversely affect the company's operations and financial resources[128]. - The Foreign Investment Law in China may affect the company's business operations and structure, with potential risks if its electronic glass business is placed on the "negative list" for foreign investment[187]. Technology and Innovation - The company's growth is heavily reliant on its ability to innovate and enhance its technology infrastructure to meet customer demands[77]. - The success of the company's nano-coated products depends on the continuous innovation of its third-party equipment manufacturer[148]. - The blockchain technology underlying the company's NFT marketplace faces industry-wide challenges, which could materially impact its successful development[73]. - The company acknowledges that the NFT industry is characterized by rapid changes and uncertainties regarding consumer adoption, which may deter the acceptance of NFTs[74]. Operational Risks - The company has limited manufacturing experience and may face delays in producing sufficient quantities of products, which could harm its business and operations[48]. - Reliance on contractors for manufacturing air filters and air purifiers exposes the company to risks related to the business conditions of these contractors[49]. - The company relies on complex machinery for production, and unexpected malfunctions may significantly affect operational efficiency and production costs[105]. - Payment processing risks could adversely impact revenues and operating expenses due to reliance on third-party payment processors[59]. - Security breaches and attacks on internal systems could damage the company's reputation and materially affect its financial condition[60]. Shareholder and Market Considerations - The Ordinary Shares have traded below US$5.00 per share during the fiscal year ended December 31, 2021, categorizing them as "penny stock" under SEC regulations[162]. - The market price of the Ordinary Shares is likely to be highly volatile due to low trading volumes and external factors such as COVID-19[165]. - The company may be classified as a Passive Foreign Investment Company (PFIC), which could adversely affect U.S. investors' tax returns[166]. - The company follows home country corporate governance practices instead of certain NASDAQ requirements, which may not provide the same protections to shareholders[168]. - The company may face challenges in attracting major brokerage firms for coverage, which could limit its visibility in the market[178].