Financial Performance - The company reported a net loss, raising substantial doubt about its ability to continue as a going concern[204]. - Total revenue for the year ended December 31, 2021, was $18,273,442, a decrease of 18.5% from $22,526,201 in 2020[222]. - Gross profit for 2021 was $1,576,146, down 26.6% from $2,146,682 in 2020[222]. - The net loss for 2021 was $11,126,960, compared to a net loss of $9,808,360 in 2020, representing a 13.4% increase in losses[224]. - Total comprehensive loss for 2021 was $13,056,289, compared to $6,687,871 in 2020, indicating a significant increase in overall losses[224]. - Cash used in operating activities for 2021 was $7,203,843, significantly higher than $2,598,865 used in 2020, indicating a deterioration in cash flow from operations[231]. - The company recorded a total consolidated loss of $11,126,960 in 2021, compared to a loss of $9,808,360 in 2020, reflecting an increase in losses[340]. Revenue Breakdown - North America contributed 17% of total sales in 2021, with revenue of $3,121,797, while Europe accounted for 58% with revenue of $10,493,574, down from $17,973,628 in 2020[265]. - Liquid filters and systems accounted for 39% of total sales in 2021, generating $7,196,465, down from $14,147,842 in 2020[265]. - Diesel particulate filters also represented 39% of total sales, with revenue increasing to $7,183,868 in 2021 from $5,131,891 in 2020[265]. - The Water segment generated revenues of $7,196,465 in 2021, down from $13,615,904 in 2020, representing a decline of 47.3%[338]. - The Ceramics segment saw an increase in revenues to $7,183,868 in 2021, up 27% from $5,663,830 in 2020[338]. - The Plastics segment reported revenues of $3,615,681 in 2021, an increase of 36.5% compared to $2,647,366 in 2020[338]. Assets and Liabilities - Total current assets increased to $28,066,781 as of December 31, 2021, compared to $25,654,926 in 2020, reflecting a growth of 9.3%[216]. - Total liabilities rose significantly to $32,279,832 in 2021, up from $17,391,822 in 2020, marking an increase of 85.5%[219]. - Total assets as of December 31, 2021, were $45,054,692, an increase from $42,210,137 in 2020[342]. - The company recorded operating lease liabilities totaling $7,000,608 as of December 31, 2021, with a weighted average remaining lease term of 8.9 years[293]. Cash Flow and Financing - Total cash provided by financing activities in 2021 was $13,902,999, compared to $7,216,902 in 2020, reflecting a 92.5% increase in financing inflows[231]. - Cash, cash equivalents, and restricted cash at the end of 2021 totaled $17,489,380, up from $13,264,449 at the end of 2020, marking a 31.5% increase[231]. - As of December 31, 2021, the company recorded $2,125,695 as restricted cash and $15,363,685 as unrestricted cash, totaling $17,489,380 in cash, cash equivalents, and restricted cash[284]. Research and Development - Research and development expenses increased to $1,862,653 in 2021, up 45.6% from $1,278,331 in 2020[222]. - Research and development costs increased to $1,862,653 in 2021 from $1,278,331 in 2020, reflecting a focus on new product development[272]. Customer Dependency and Risks - The company is dependent on a few major customers for a significant portion of its revenue, which poses risks to its financial condition[12]. - The anticipated impacts from the COVID-19 pandemic have affected the company's business operations, results, cash flows, and financial position[11]. - The company may face potential adverse effects from changes in China's political, social, regulatory, or economic environments[12]. - The company has faced challenges due to COVID-19, impacting its financial results and operational capacity, with ongoing cash flow concerns for the next 12 months[248]. Stock and Equity - Basic and diluted loss per share for 2021 was $(0.52), compared to $(0.46) in 2020[222]. - Total stockholders' equity decreased to $12,774,860 in 2021 from $24,818,315 in 2020, a decline of 48.6%[219]. - The company had 149,636 stock grants and 1,015,000 prefunded warrants outstanding as of December 31, 2021[319]. - The company has 100,000,000 authorized shares of common stock, with 21,285,706 shares issued and outstanding as of December 31, 2021[320]. Accounting and Compliance - The company adopted several accounting standards updates, including ASU 2020-03 and ASU 2019-12, with no material impact on consolidated financial statements expected[281][282]. - The company incurred significant estimates and assumptions in determining standard costing allocation and overhead allocations[210]. - The company evaluates goodwill annually for impairment, with the fair value determined using discounted cash flow and market approaches[264]. Future Plans and Developments - The company has plans for future operations and market trends, but these involve numerous risks and uncertainties[15]. - The company plans to establish a joint venture for water treatment systems in the Middle East, holding 49% of the shares[304]. - The company has received long-term contracts for government grants for the development of silicon carbide membranes, indicating ongoing market expansion efforts[269].
LiqTech(LIQT) - 2021 Q4 - Annual Report