LIQUID AVATAR TECHNOLOGIES INC. Liquid Avatar Technologies Inc.
Interim Condensed Consolidated Financial Statements
(unaudited)
For the Three and Nine Month Period Ended September 30, 2022 and 2021
Expressed in Canadian Dollars
Unaudited Interim Condensed Consolidated Financial Statements
In accordance with National Instrument 51-102 released by the Canadian Securities Administrators, the Company discloses that its auditors have not reviewed the unaudited interim condensed consolidated financial statements for the three and nine month period ended September 30, 2022
Liquid Avatar Technologies Inc.
Interim Condensed Consolidated Statements of Financial Position
(Unaudited, Expressed in Canadian Dollars)
As at September 30, 2022 and December 31, 2021
September 30, | December 31, | |||
2022 | 2021 | |||
Assets | ||||
Current | ||||
Cash | $ | 52,056 | $ | 646,096 |
Accounts receivable | 165,313 | 713,284 | ||
Harmonized sales tax receivable | 164,085 | 62,392 | ||
Prepaid expenses and other current assets | 1,160,916 | 686,680 | ||
1,542,370 | 2,108,452 | |||
Prepaid long-term expense and other assets | 42,500 | 61,250 | ||
Investment (Note 4) | 122,722 | 122,722 | ||
Computer and related equipment | 15,222 | 24,433 | ||
Intangible assets (Note 6) | 437,158 | 638,923 | ||
$ | 2,159,972 | $ | 2,955,780 | |
Liabilities | ||||
Current | ||||
Accounts payable and accrued expenses | $ | 3,968,612 | $ | 843,569 |
Due to KABN (Gibraltar) Ltd. (Note 11) | 499,482 | 112,480 | ||
Deferred revenue | 2,535,421 | 1,058,270 | ||
Short term loans payable (Note 5) | 960,362 | 517,069 | ||
7,963,877 | 2,531,388 | |||
Shareholders' (Deficiency)/Equity | ||||
Share capital (Note 7) | 11,136,773 | 10,486,492 | ||
Shares to be issued (Note 7) | 25,000 | - | ||
Contributed surplus (Notes 8 and 10) | 4,431,054 | 4,381,239 | ||
Broker compensation options (Note 9) | 589,253 | 589,253 | ||
Warrants (Note 8) | 3,000,148 | 2,583,964 | ||
Accumulated other comprehensive loss | (166,290) | - | ||
Deficit | (24,819,843) | (17,616,556) | ||
(5,803,905) | 424,392 | |||
$ | 2,159,972 | $ | 2,955,780 |
Going Concern (Note 1)
Subsequent Events (Note 17)
Approved by the Board | "David Lucatch" | "Andra Enescu" |
Director (Signed) | Director (Signed) | |
See accompanying notes | 2 |
Liquid Avatar Technologies Inc.
Interim Condensed Consolidated Statements of Loss and Comprehensive Loss (Unaudited Expressed in Canadian Dollars)
For the Three and Nine Month Period Ended September 30, 2022 and 2021
Three Months | Nine Months | ||||||||
Ended | Three Months | Ended | Nine Months | ||||||
Sept 30, | Ended | Sept 30, | Ended | ||||||
2022 | Sept 30, 2021 | 2022 | Sept 30, 2021 | ||||||
Revenue | |||||||||
Liquid Avatar Operations | $ | - | $ | 700 | $ | 40 | $ | 833 | |
Oasis Digital Studios Operations | 1,704 | 4,372 | 1,794 | 14,972 | |||||
Aftermath Islands Operations | 588 | - | 588 | - | |||||
2,292 | 5,072 | 2,422 | 15,805 | ||||||
Operating expenses | |||||||||
Amortization | 67,255 | 67,255 | 201,765 | 201,765 | |||||
Depreciation on tangible assets | 3,070 | 3,070 | 9,211 | 9,211 | |||||
Agent fees | - | - | - | 38,417 | |||||
Consulting fees | 627,675 | 297,964 | 1,736,897 | 616,141 | |||||
General and administrative costs | 127,697 | 57,715 | 549,773 | 259,993 | |||||
Interest expense | 28,329 | 10,500 | 54,532 | 10,500 | |||||
Legal and audit fees | 32,323 | 48,011 | 231,599 | 280,912 | |||||
Management and staff | 336,379 | 473,487 | 1,172,747 | 1,312,222 | |||||
Marketing and communications | 274,243 | 321,930 | 1,141,757 | 1,267,524 | |||||
Product development | 488,270 | 864,646 | 1,263,121 | 1,954,427 | |||||
Web and infrastructure | 133,380 | 38,146 | 336,885 | 116,730 | |||||
Annual license fee | - | - | 322,571 | 250,000 | |||||
Financing fee | - | - | 12,000 | - | |||||
Stock based compensation | - | 199,260 | 49,815 | 1,554,104 | |||||
2,118,621 | 2,381,984 | 7,082,673 | 7,871,946 | ||||||
Other losses | |||||||||
Foreign exchange loss | (95,020) | (19,289) | (123,036) | (38,610) | |||||
(2,213,641) | (2,401,273) | (7,205,709) | (7,910,556) | ||||||
Net loss | $ | (2,211,349) | $ | (2,396,201) | $ | (7,203,287) | $ | (7,894,751) | |
Other comprehensive loss | |||||||||
Exchange differences from | |||||||||
translation of foreign subsidiaries | (143,836) | - | (166,290) | - | |||||
Comprehensive loss | $ | (2,355,184) | $ | (2,396,201) | $ | (7,369,577) | $ | (7,894,751) | |
Comprehensive loss attributable | |||||||||
to non-controlling interest | (361,428) | - | (704,103) | - | |||||
Basic and diluted loss per share | |||||||||
Basic and diluted | $ | (0.014) | $ | (0.020) | $ | (0.049) | $ | (0.073) | |
Weighted average number of common shares outstanding | |||||||||
Weighted average number of | |||||||||
common shares | 157,956,495 | 119,383,989 | 147,092,991 | 108,681,917 |
See accompanying notes | 3 |
Liquid Avatar Technologies Inc. Interim Condensed Consolidated Statements of Changes in Shareholders' (Deficiency)/Equity (Unaudited Expressed in Canadian Dollars)
For the Nine Month Period Ended September 30, 2022 and 2021
Number of | Reserve | Broker | |||||||||||||
Common | for | Compensation | Contributed | ||||||||||||
Shares | Amount | Warrants | Options | Surplus | Deficit | Total | |||||||||
Balance January 1, 2021 | 96,216,472 | 5,858,759 | 2,416,120 | 652,786 | 754,400 | (6,252,624) | $ | 3,429,441 | |||||||
Issued for warrant exercises (Note 7) | 10,713,933 | 1,858,286 | (645,384) | - | 645,384 | - | 1,858,286 | ||||||||
Issued for consultant obligations (Note 9) | 332,894 | 101,470 | - | - | - | - | 101,470 | ||||||||
Issued in connection with option exercise (Note 7) | 305,100 | 45,765 | - | - | - | - | 45,765 | ||||||||
Stock based compensation (Note 10) | - | - | - | - | 1,554,104 | - | 1,554,104 | ||||||||
Issuance for broker unit exercise (Note 9) | 2,288 | 343 | 384 | (789) | 405 | - | 343 | ||||||||
Issued for early warrant exercise incentive and consultant | |||||||||||||||
warrant compensation (Note 7) | 1,514,288 | - | 165,120 | - | - | - | 165,120 | ||||||||
Issued in connection with private placement (Note 7) | 25,800,001 | 1,387,269 | 1,093,967 | - | - | - | 2,481,236 | ||||||||
Net loss | - | - | - | - | - | (7,894,751) | (7,894,751) | ||||||||
Balance September 30, 2021 | 134,884,976 | $ | 9,251,892 | $ | 3,030,207 | $ | 651,997 | $ | 2,954,293 | $ | (14,147,375) | $ | 1,741,015 | ||
Balance January 1, 2022 | 141,178,473 | $ | 10,486,492 | $ | 2,583,964 | $ | 589,253 | $ | 4,381,239 | $ | (17,616,556) | $ | 424,392 | ||
Issued in connection with option exercise (Note 7) | 500,000 | 75,000 | - | - | - | - | 75,000 | ||||||||
Stock based compensation (Note 10) | - | - | - | - | 49,815 | - | 49,815 | ||||||||
Issued in connection with private placements (Note 7) | 20,614,000 | 575,281 | 405,826 | - | - | - | 981,107 | ||||||||
Issuance of finder's warrants (Notes 7 and 8) | - | - | 10,358 | - | - | - | 10,358 | ||||||||
Shares to be issued (Note 7) | - | - | - | - | - | 25,000 | |||||||||
Net loss | - | - | - | - | - | (7,203,287) | (7,203,287) | ||||||||
Balance September 30, 2022 | 162,292,473 | $ | 11,136,773 | $ | 3,000,148 | $ | 589,253 | $ | 4,431,054 | $ | (24,819,843) | $ | (5,637,615) | ||
Accumulated other comprehensive income | |||||||||||||||
Other comprehensive income Q1, 2022 | 5,577 | ||||||||||||||
Other comprehensive loss, Q2, 2022 | (28,031) | ||||||||||||||
Other comprehensive loss, Q3, 2022 | (143,836) | ||||||||||||||
Accumulated other comprehensive loss Sept 30, 2022 | (166,290) | ||||||||||||||
(5,803,905) | |||||||||||||||
See accompanying notes | 4 |
Liquid Avatar Technologies Inc.
Interim Condensed Consolidated Statements of Cash Flows
(Unaudited Expressed in Canadian Dollars)
For the Nine Month Period Ended September 30, 2022 and 2021
Nine Month | Nine Month | |||
Period Ended | Period Ended | |||
September 30, | September 30, | |||
2022 | 2021 | |||
Cash provided by (used in) | ||||
Operations | ||||
Net loss | $ | (7,203,287) | $ | (7,894,751) |
Items not affecting cash | ||||
Amortization | 201,765 | 201,765 | ||
Depreciation | 9,211 | 9,211 | ||
Foreign exchange loss | 123,086 | 38,610 | ||
Expenses paid in shares or debt | 337,070 | 101,470 | ||
Stock based compensation | 49,815 | 1,554,104 | ||
Net cash flows used in operating activities before changes in | ||||
non-cash working capital items | (6,482,390) | (5,989,591) | ||
Net change in non-cash working capital | ||||
Increase in prepaid expenses and other current assets | (474,235) | (113,527) | ||
Decrease/(Increase) in prepaid long-term expenses and other | ||||
assets | 18,750 | (11,250) | ||
Increase in accounts payable and accrued expenses | 3,241,075 | 417,494 | ||
(Increase)/Decrease in harmonized sales tax recoverable | (101,693) | 9,538 | ||
Decrease/(Increase) in accounts receivable | 547,971 | (55,364) | ||
Increase in deferred revenue | 1,477,151 | - | ||
Increase/(Decrease) in due to KABN (Gibraltar) Ltd. | 387,002 | (50,000) | ||
Net cash flows used in operating activities | (1,386,369) | (5,792,700) | ||
Investing | ||||
Acquisition of investment | - | (122,722) | ||
Purchase of computer and related equipment | - | (18,216) | ||
Net cash flows used in investing activities | - | (140,938) | ||
Financing | ||||
Repayment of short term loan payable | (117,069) | - | ||
Proceeds from short term loans in Aftermath Islands | 394,213 | - | ||
Net proceeds from common shares and unit issuances/advance | 515,185 | 4,520,750 | ||
Net cash flows provided by financing activities | 792,329 | 4,520,750 | ||
Net change in cash | (594,040) | (1,412,888) | ||
Cash, beginning of period | 646,096 | 2,588,590 | ||
Cash, end of period | $ | 52,056 | $ | 1,175,702 |
See accompanying notes | 5 |
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Liquid Avatar Technologies Inc. published this content on 01 December 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 01 December 2022 05:43:03 UTC.
