TRxADE HEALTH(US:MEDS)2023-05-15 21:16Financial Performance - Total revenues for Q1 2023 were $2,247,750, a decrease of 30.7% compared to $3,240,272 in Q1 2022[17] - Gross profit for Q1 2023 increased to $1,557,080, up 16.6% from $1,335,703 in Q1 2022[17] - Operating expenses decreased to $1,904,486 in Q1 2023, down 17.4% from $2,304,275 in Q1 2022[17] - Net loss attributable to TRxADE Health, Inc. for Q1 2023 was $677,953, compared to a net loss of $960,147 in Q1 2022, representing a 29.4% improvement[17] - The company reported a basic and diluted net loss per common share of $0.07 for Q1 2023, compared to $0.12 for Q1 2022[17] - Net loss from continuing operations for Q1 2023 was $325,709, a decrease from a loss of $965,836 in Q1 2022, indicating an improvement of approximately 66.3%[39] - Total net cash used in operating activities for Q1 2023 was $931,531, compared to $1,000,771 in Q1 2022, reflecting a reduction of about 6.9%[22] - Cash at the end of Q1 2023 was $1,194,079, down from $1,870,682 at the end of Q1 2022, representing a decline of approximately 36.1%[22] - The company recorded a bad debt recovery of $32,074 in Q1 2023, compared to a bad debt expense of $1,317 in Q1 2022[34] - Basic and diluted loss per common share for Q1 2023 was $0.07, compared to $0.12 in Q1 2022, showing an improvement of approximately 41.7%[39] - The company reported a working capital deficit of $164,035 as of March 31, 2023, raising concerns about its ability to continue as a going concern[41] - The company estimates operating expenses and working capital requirements for the next 12 months to be approximately $8,000,000[118] Assets and Liabilities - Total assets increased to $4,037,771 as of March 31, 2023, up 8.8% from $3,710,026 at the end of 2022[15] - Total current liabilities rose to $2,550,148 as of March 31, 2023, an increase of 18.8% from $2,146,791 at the end of 2022[15] - Stockholders' equity increased to $655,140 as of March 31, 2023, compared to $342,867 at the end of 2022, reflecting a significant improvement[15] - Cash and cash equivalents increased to $1,194,079 as of March 31, 2023, up from $1,111,156 at the end of 2022[15] - The company has a total minimum lease payment obligation of $1,260,835 as of March 31, 2023, with long-term lease obligations amounting to $820,346[78] - Current assets (excluding cash) rose by 24% to $1,192,034 as of March 31, 2023, compared to $959,490 at December 31, 2022[116] - Current liabilities (excluding short-term debt) increased by 29% to $2,550,148 as of March 31, 2023, from $1,980,124 at December 31, 2022[116] - Working capital decreased to $(164,035) as of March 31, 2023, reflecting a 206% decline from $(53,668) at December 31, 2022[116] Strategic Initiatives - The company plans to raise additional capital or secure debt funding to support ongoing operations, which may not be available on favorable terms[41] - The company is actively developing new products, including a telehealth platform expected to launch in Q3 2023, aimed at enhancing user engagement[191] - TRxADE HEALTH, INC. is pursuing market expansion strategies, targeting new geographic regions, particularly in the Southeast Asian market[191] - The company plans to invest approximately $5 million in research and development for new technologies in the upcoming fiscal year[191] - The company plans to increase its client base and operational revenue on its platforms and may pursue strategic transactions, including potential sales or fundraising[117] Operational Challenges - The company has an accumulated deficit of $19.9 million as of March 31, 2023, indicating significant financial challenges[41] - The company faces risks related to obtaining additional capital, which may not be available on commercially acceptable terms, raising doubts about its ability to continue as a going concern[157] - Inflationary pressures and supply chain disruptions have increased operating costs, potentially affecting the company's financial condition and results of operations[160] - The company has not experienced significant negative impacts from COVID-19 but has faced supply chain interruptions affecting wholesalers and technology outsourcing[106] Compliance and Regulatory Issues - The company is currently prohibited from filing new registration statements on Form S-3 until at least October 2023 due to compliance issues with the SEC[164] - The company reported stockholders' equity of $1,804,533 as of June 30, 2022, which is below the Nasdaq minimum requirement of $2,500,000 for continued listing[167] - The company is required to maintain a stock price over $1.00 per share to comply with Nasdaq listing requirements[174] - If the company fails to demonstrate compliance with Nasdaq requirements, it may face delisting from the Nasdaq Capital Market[170] - The company has not repurchased any shares of common stock during the first quarter of 2023[179] User and Revenue Growth - TRxADE HEALTH, INC. reported a significant increase in revenue, with a year-over-year growth of 25% in Q1 2023[191] - The company has expanded its user base, reaching over 1 million registered users, which represents a 30% increase compared to the previous quarter[191] - TRxADE HEALTH, INC. anticipates continued growth, projecting a revenue increase of 15% to 20% for the next quarter[191] - For the three months ended March 31, 2023, processed sales volume increased by 7%, and total revenue grew by 4% compared to the same period in 2022[99] - Trxade Inc. revenue from platform sales increased by 6%, while revenue from Trxade Prime decreased by approximately 11% for the three months ended March 31, 2023[126] Internal Controls and Governance - Management identified material weaknesses in internal controls, including insufficient written policies for accounting and financial reporting[144] - The company has committed to improving its financial organization by increasing personnel resources and technical accounting expertise[146] - The company recognizes that any controls and procedures can only provide reasonable assurance of achieving desired control objectives due to resource constraints[149] - The company believes that the resolution of current legal proceedings will not have a material adverse effect on its financial condition or results of operations[153]