Mobile Esports (MGAM) - 2023 Q2 - Quarterly Report

Financial Performance - The company reported a net loss of $1,703,845 for the six months ended June 30, 2023, compared to a net loss of $891,352 for the same period in 2022, indicating an increase in losses of approximately 91%[16] - For the six months ended June 30, 2023, the net loss was $1,703,845 compared to a net loss of $177,265 for the same period in 2022, representing an increase in loss of approximately 865%[20] - The net loss per share attributable to common stockholders for the six months ended June 30, 2023, was $(0.08), compared to $(0.04) for the same period in 2022[16] Operating Expenses - Operating expenses for the six months ended June 30, 2023, were $1,732,102, significantly higher than $915,962 for the same period in 2022, reflecting an increase of approximately 89%[16] - General and administrative expenses included approximately $13,000 in advertising costs for the six months ended June 30, 2023, compared to nil for the same period in 2022[66] - The Company paid a total of $178,000 in compensation to its CEO and CFO during the six months ended June 30, 2023[50] Assets and Liabilities - Total current assets decreased from $8,132,921 as of December 31, 2022, to $6,119,374 as of June 30, 2023, representing a decline of approximately 24.8%[14] - Cash and cash equivalents decreased from $7,539,674 as of December 31, 2022, to $6,061,078 as of June 30, 2023, a reduction of about 19.6%[14] - The total stockholders' equity decreased from $9,010,533 as of December 31, 2022, to $7,444,682 as of June 30, 2023, a decline of about 17.4%[14] - The accumulated deficit increased from $(1,549,388) as of December 31, 2022, to $(3,251,331) as of June 30, 2023, representing a deterioration of approximately 109.5%[18] - The company’s total liabilities increased from $246,268 as of December 31, 2022, to $316,809 as of June 30, 2023, an increase of approximately 28.5%[14] Cash Flow - Net cash used by operating activities for the six months ended June 30, 2023 was $952,225, significantly higher than $116,119 for the same period in 2022[20] - The company reported a net cash used in investing activities of $429,490 for the six months ended June 30, 2023, with no such activities reported in the same period of 2022[20] - Cash and restricted cash as of June 30, 2023 totaled $6,084,693, a decrease from $7,559,674 at the beginning of the period[20] Software Development and Investments - As of June 30, 2023, the Company paid approximately $1,241,000 for the development of a software platform, which is currently in Beta testing and expected to be in service in Q3 or Q4 2023[63] - The Company has entered into an agreement for the development of a mobile application and made payments of $200,000 towards this development as of June 30, 2023[64] - The company incurred $416,074 in advances to suppliers for software during the six months ended June 30, 2023, with no such expenses reported in the same period of 2022[20] Other Financial Metrics - The company reported interest income of $28,257 for the six months ended June 30, 2023, compared to $24,610 for the same period in 2022, reflecting an increase of approximately 14%[16] - The company reported a depreciation expense of $2,124 for the six months ended June 30, 2023, compared to no depreciation expense in the same period of 2022[20] - The accumulated depreciation for property and equipment increased from $35 as of December 31, 2022, to $2,159 as of June 30, 2023[45] Accounts Payable and Lease Liabilities - Total accounts payable and accrued expenses increased to $167,427 as of June 30, 2023, compared to $80,960 as of December 31, 2022, reflecting a significant rise of 106%[49] - The Company recorded operating lease costs of approximately $28,000 for the six months ended June 30, 2023, with cash paid for operating leases approximating $26,600[47] - The present value of operating lease liabilities as of June 30, 2023, is $130,846, with total future lease payments amounting to $147,574[48] Stock and Warrants - The Company issued 170,000 warrants with an exercise price of $3.00 per share during the six months ended June 30, 2023, with an estimated fair value of $91,000[56] - The Company has authorized the issuance of 100,000,000 shares of common stock, with 20,421,593 shares issued and outstanding as of June 30, 2023[54] - The Company has committed to issue up to 350,000 shares of common stock in the future as part of agreements with consultants[65] Impact of MOGO Pvt Ltd - MOGO Pvt Ltd comprised approximately 9.3% of the company's net loss for the six months ended June 30, 2023, indicating its impact on overall financial performance[22]