TORONTO, March 1,
2023 /CNW/ - SQI Diagnostics Inc. (TSXV: SQD)
(OTCQB: SQIDF), a leader in the science of lung health that
develops and manufactures respiratory health and precision medicine
tests today reported its financial and operational results for the
first quarter ended December 31,
2022.
Q1 2023 Financial Highlights
- Sales of $.4M in Q1 2023 were
significantly higher, compared to $0.1M in Q1 2022. The increase in sales is
attributed to the COVID-19 human testing business acquired during
the second quarter of fiscal 2022.
- Gross profit was $0.1M in Q1
2023, compared to $0.1M in Q1
2022.
- Corporate & General expenses were $1.1M in Q1 2023, compared to $1.6M in Q1 2022. The decrease is mainly related
to lower stock-based compensation due to the pausing of vesting of
certain milestone options as well as lower salaries & wages as
the current CEO and the previous CEO were paid in Q1 2022.
- The R&D expense category, which includes Manufacturing,
Quality and Engineering was $1.4M in
Q1 2023, compared to $1.7M in Q1
2022. The decrease was due to lower lab costs as a result of a
significant reduction in consulting costs, lower stock-based
compensation costs partially offset by higher salaries & wages
due to an increase in R&D personnel as well as salary
adjustments to reflect market rates for select personnel.
- Net loss was ($3.1M) of
($0.01) per share, compared to
($3.4M) or ($0.01) per share.
- Cash and cash equivalents were $0.6M as of December 31,
2022.
- Net working capital was $(9.2M)
as of December 31, 2022, compared to
$2.7M on December 31, 2022; the working capital deficit is
due primarily to the $7.5M short term
credit facility used to acquire the COVID-19 PCR business from
Precision Biomonitoring Inc in Q2 2022.
Q1 2023 Corporate Highlights
- The Company secured an Interim Order from Health Canada for its
RALI-Dx™ IL-6 Severity Triage Test in November 2022. The RALI-Dx™ IL-6 Severity Triage
Test is the first of its kind to enter the Canadian market.
- On November 10, 2022, The Company
entered into a funding agreement (the "Contribution Agreement")
with the Federal Economic Development Agency for Southern Ontario ("FedDev Ontario") to support
the Company's manufacturing scale-up and commercialization of its
pipeline of products in development. Under the terms of the
Contribution Agreement, the Company will be able to draw down up to
$2 million of funding in the form of
interest-free contributions.
- On October 19, 2022, the maturity
date of its secured $7,500,000 credit
facility with Pivot Financial (the "Pivot Credit Facility") was
extended to January 31, 2023 from
October 28, 2022. Subsequent to the
quarter ended December 31, 2023, the
maturity date of the Pivot Credit Facility was extended to
February 28, 2023 and again to
April 30, 2023.
Liquidity and Going Concern Risk
While management considers that the preparation of its financial
statements under the going concern basis is appropriate, there is
significant doubt about the Company's ability to continue as a
going concern as the Company has a working capital deficit of
$9.2M as at December 31, 2022 and for the three month period
ended December 31, 2022 the Company
incurred a net loss of $3.1M. The
Company's ability to continue as a going concern is dependent upon
the Company's ability to raise additional capital through equity
and/or debt financings and achieve profitable operations. While the
Company continues to pursue commercial sales, strategic partnering
activities and funding opportunities, there are no assurances that
it will be successful in generating revenues or raising additional
investment capital to generate sufficient cash flows to continue as
a going concern and there is significant doubt about the Company's
ability to continue as a going concern without achieving such
revenue or financing in the near term. Should the Company be unable
to continue as a going concern, it may be unable to realize the
carrying value of its assets and to meet its liabilities as they
become due.
As of the writing of the date hereof, the Company has not
received any viable term sheets from potential sources of financing
and management does not currently believe that the Company will
have sufficient cash to continue operations as currently conducted
beyond March 31, 2023 without
successfully raising additional equity and/or debt
capital. The Company will announce additional details relating
to any new financing or financings, if any, in due course in the
event that it is successful in negotiating and entering into
definitive documentation relating to same. Please see the Company's
Condensed Interim Consolidated Financial Statements for the three
months ended December 31, 2022 and
December 31, 2021 and related
Management Discussion & Analysis filed on SEDAR on March 1, 2023 for additional details
regarding the Company's current cash position and risks relating
thereto.
About SQI Diagnostics
SQI Diagnostics is a leader in the science of lung health. The
Company develops and manufactures respiratory health and precision
medicine tests that run on SQI's fully automated systems. The
Company's tests simplify and improve COVID-19 antibody monitoring,
Rapid Acute Lung Injury testing, donor organ transplant
informatics, and immunological protein and antibody testing. SQI
Diagnostics is driven to create and market life-saving testing
technologies that help more people in more places live longer,
healthier lives. For more information, please visit
www.sqidiagnostics.com.
Contact:
Chief Financial Officer
Morlan Reddock
437-235-6563
mreddock@sqidiagnostics.com
FORWARD-LOOKING INFORMATION
This press release contains certain words and statements,
which may constitute "forward-looking statements" within the
meaning of applicable securities laws relating to future events or
future performance and reflect the current expectations and
assumptions of the Company regarding its growth, results of
operations, performance, business prospects and opportunities.
These statements generally can be identified by use of
forward-looking words such as "may", "would", "could", "will",
"should", "expect", "plan", "estimate", "anticipate", "intends",
"believe", "potential", or "continue" or the negative thereof or
similar variations. The Company's actual results and performance
discussed herein could differ materially from those expressed or
implied by such statements. Such statements are qualified in their
entirety by the inherent risks and uncertainties surrounding future
expectations. Important factors that could cause actual results to
differ materially from expectations include, among other things,
general economic and market factors, competition, the effect of the
global pandemic and consequent economic disruption, and the factors
detailed in the Company's ongoing filings with the securities
regulatory authorities, available at www.sedar.com. Although the
forward-looking statements contained herein are based on what we
consider to be reasonable assumptions based on information
currently available to us, there can be no assurance that actual
events, performance or results will be consistent with these
forward looking statements, and our assumptions may prove to be
incorrect. Readers are cautioned not to place undue reliance on
these forward-looking statements. The Company undertakes no
obligation to publicly update or revise any forward-looking
statements either as a result of new information, future events or
otherwise, except as required by applicable law.
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
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SOURCE SQI Diagnostics Inc.