Mobile Esports (US:MGAM)2023-11-20 21:01Financial Performance - The net loss attributable to Mobile Global Esports Inc. for the nine months ended September 30, 2023, was $3,546,377, compared to a net loss of $547,889 for the same period in 2022, indicating a substantial increase in losses[16]. - Operating expenses for the nine months ended September 30, 2023, totaled $3,578,785, compared to $1,846,683 for the same period in 2022, reflecting an increase of approximately 94%[16]. - The company reported no revenue for the three and nine months ended September 30, 2023, consistent with the same periods in 2022[16]. - The company incurred a comprehensive loss of $3,552,247 for the nine months ended September 30, 2023, compared to $1,847,936 for the same period in 2022, indicating a worsening financial position[16]. - The net loss per share attributable to common stockholders for the nine months ended September 30, 2023, was $(0.17), compared to $(0.03) for the same period in 2022[16]. - For the nine months ended September 30, 2023, the net loss was $3,550,287 compared to a net loss of $547,889 for the same period in 2022, indicating a significant increase in losses[21]. - The company incurred net cash used by operating activities of $2,474,935 for the nine months ended September 30, 2023, compared to $371,885 for the same period in 2022[21]. - The Company recorded total expense of approximately $69,000 and $208,000 for the three and nine months ended September 30, 2023, respectively, compared to $46,000 and $139,000 for the same periods in 2022[64]. - The Company incurred sponsorship expenses of approximately $24,000 with an entity that shares common ownership with a stockholder during the nine months ended September 30, 2023[52]. Assets and Liabilities - Total assets decreased from $9,256,801 on December 31, 2022, to $6,285,397 as of September 30, 2023, representing a decline of approximately 32%[14]. - Current liabilities increased significantly from $207,816 to $553,565, marking a rise of about 167%[14]. - Cash reserves decreased from $7,539,674 on December 31, 2022, to $4,514,459 as of September 30, 2023, a reduction of about 40%[14]. - The total stockholders' equity decreased from $9,010,533 on December 31, 2022, to $5,665,976 as of September 30, 2023, a decline of about 37%[14]. - The total stockholders' equity as of September 30, 2023, was $5,665,976, a decrease from $9,747,400 as of September 30, 2022[19]. - Total accounts payable and accrued expenses increased to $380,620 as of September 30, 2023, compared to $80,960 as of December 31, 2022, primarily due to accrued payroll and payroll taxes of $90,626[50]. - The Company has operating lease liabilities totaling $130,941 as of September 30, 2023, with a present value of $117,564 after accounting for imputed interest[49]. Shareholder Information - The weighted average common shares outstanding increased from 17,256,256 in 2022 to 20,421,593 in 2023, representing an increase of approximately 18%[16]. - The Company has authorized the issuance of 100,000,000 shares of common stock, with 20,421,593 shares issued and outstanding as of September 30, 2023[56]. - The Company has entered into agreements to issue up to 350,000 shares of common stock to various consultants in the future[68]. - The Company issued common stock from an initial public offering, net of stock issuance costs, totaling $5,464,932[19]. Cash Flow and Investments - The company reported cash and restricted cash of $4,514,459 as of September 30, 2023, down from $9,469,521 at the end of the same period in 2022[21]. - The company reported a net cash increase of $3,045,215 for the nine months ended September 30, 2023, compared to an increase of $9,231,319 for the same period in 2022[21]. - The Company has paid approximately $1,258,000 to a supplier for the development of a software platform, which is not yet in service, and an additional $200,000 for the development of a mobile application as of September 30, 2023[47]. - The Company has committed to pay a supplier $1,200,000 for the development of an Esports Platform, with the software currently in Beta testing and expected to be in service by Q4 2023 or early 2024[66]. - The Company paid $200,000 towards the acquisition of intellectual property for an App under development and agreed to issue 400,000 shares of common stock to the supplier[67]. Warrants and Expenses - The fair value of warrants issued for services was $207,690 for the nine months ended September 30, 2023, compared to $139,440 for the same period in 2022[21]. - The Company issued 170,000 warrants during the nine months ended September 30, 2023, with an estimated fair value of $91,000, of which $68,250 was recognized as an expense[59]. - The estimated fair value of the PIPE Warrants was approximately $2,093,000, while the Placement Agent Warrants had an estimated fair value of approximately $516,000[62]. - The unamortized warrant expense as of September 30, 2023, was approximately $255,000, to be amortized over a weighted-average period of 0.7 years[64]. - The IPO Warrants issued in July 2022 have an exercise price of $6.60 per share and an estimated fair value of approximately $474,000[61]. Other Information - The Company has a controlling interest of 99% in MOGO Pvt Ltd, which contributed approximately 9.2% of the company's net loss for the nine months ended September 30, 2023[24]. - The Company has not identified any impairments of long-lived assets to date, with ongoing reviews for realizability[35]. - As of September 30, 2023, the Company reported property and equipment, net, of $27,271, an increase from $16,822 as of December 31, 2022, reflecting a depreciation expense of approximately $1,000 for the nine months ended September 30, 2023[46]. - The cash paid for operating leases for the nine months ended September 30, 2023, approximated $41,000, with an operating lease cost recorded of approximately $43,000[48]. - Advertising expenses for the three and nine months ended September 30, 2023, totaled approximately $29,000 and $39,000, respectively, compared to nil for the same periods in 2022[70].