Odyssey Marine Exploration(OMEX) - 2022 Q2 - Quarterly Report

Financial Performance - Total revenues increased to $390,000 in Q2 2022 from $182,000 in Q2 2021, representing a growth of 214.3%[113] - Total revenue for the three months ended June 30, 2022 was $0.4 million, consistent with the same period a year ago[114] - Total revenues for the six months ended June 30, 2022 were $690 million, an increase of $216 million or 45.5% compared to $474 million for the same period in 2021[120] Expenses - Marketing, general and administrative expenses rose by 48.5% to $2,292,000 in Q2 2022 compared to $1,700,000 in Q2 2021[113] - Operating expenses increased by $0.6 million to $2.3 million for the three months ended June 30, 2022, compared to $1.7 million for the same period in 2021, driven by increases in employee benefits and legal fees[115] - Marketing, general and administrative expenses increased by $1.2 million to $4.2 million for the six months ended June 30, 2022, representing a 40.7% increase from $3.0 million in 2021[122] - Total operating expenses decreased by 125.8% to $3,522,000 in Q2 2022 from $5,129,000 in Q2 2021[113] - Operations and research expenses decreased significantly by 181.3% to $1,230,000 in Q2 2022 from $3,429,000 in Q2 2021[113] - Operations and research expenses decreased by $2.2 million to $3.0 million for the three months ended June 30, 2022, primarily due to a $2.6 million decrease in litigation financed costs[116] - Total other income and expense resulted in a net expense of $3.4 million for the three months ended June 30, 2022, an increase of $4.6 million compared to a net income of $1.2 million in the same period in 2021[117] - Total other income and expense for the six months ended June 30, 2022 was a net expense of $6.8 million, an increase of $5.7 million from a net expense of $1.1 million in 2021[125] Net Loss and Financial Position - Net loss increased to $4,683,000 in Q2 2022 from a loss of $2,227,000 in Q2 2021, reflecting a deterioration of 121.2%[113] - The company has experienced several years of net losses and may continue to do so, raising doubt about its ability to continue as a going concern[146] - As of June 30, 2022, the company had a consolidated non-restricted cash balance of $10.5 million and a working capital deficit of $45.9 million[146] - The total consolidated book value of the company's assets was approximately $17.8 million as of June 30, 2022[146] Non-controlling Interest - Non-controlling interest increased by 32.6% to $1,858,000 in Q2 2022 from $1,528,000 in Q2 2021[113] - Non-controlling interest adjustment for the six months ended June 30, 2022 was $3.7 million, up from $2.9 million in the same period in 2021, reflecting a 27.6% increase[126] Cash Flow and Financing - Cash and cash equivalents increased to $10.5 million as of June 30, 2022, up from $2.3 million at December 31, 2021, representing an increase of $8.3 million[132] - Financial debt of the company was $44.6 million at June 30, 2022, an increase from $41.3 million at December 31, 2021[133] - The company entered into a Note Purchase Agreement with 37North SPV 11, LLC for a loan of up to $2,000,000, which was fully received on March 25, 2022[137] - The company prepaid $2,200,000 of the outstanding amounts under the Note Agreement on June 29, 2022, and the remaining $100,000 on July 6, 2022[139] - The company generated net proceeds of $14.7 million from the sale of 4,939,515 shares of common stock and warrants on June 10, 2022, after offering expenses of $1.8 million[144] Project Developments - The ExO Phosphate Project is expected to provide significant benefits to Mexico's agricultural development due to its high-grade phosphate rock[88] - Odyssey is pursuing a NAFTA claim against Mexico seeking over $2 billion in compensation for the repeated denial of environmental permits for the ExO project[94] - The South American Phosphate Project will cover 366 square kilometers of seabed and is anticipated to be developed using environmentally responsible methods[110] - Odyssey holds an 85.6% interest in Bismarck Mining Corporation, which is exploring the Lihir Gold Project in Papua New Guinea[98] Accounting and Risk Management - The company adopted ASC 2020-06, which affects the accounting for convertible instruments and requires the entire expected repayment amount of $2.2 million to be recorded upon issuance of the Note Agreement[140] - The company does not engage in off-balance sheet financing arrangements and has no interest in limited purpose entities[151] - The company does not believe it has material market risk exposure and has not entered into any market risk sensitive instruments[153]