GNS Genius Group Limited

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 6-K

 

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13A-16 OR 15D-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of December, 2024

 

Commission File Number: 001-41353

 

Genius Group Limited

(Translation of registrant’s name into English)

 

8 Amoy Street, #01-01

Singapore 049950

(Address of principal executive offices)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F ☒ Form 40-F ☐

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):                .

 

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders. Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):                 .

 

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

 

 

 

Genius Group Ltd. (the “Company”) which is listed on the NYSE American under the symbol “GNS” releases its unaudited financial results for the six months ended June 30, 2024, as attached hereto as Exhibit 99.3. The Company has determined that the previously announced acquisition transaction with PrimeSource for the FatBrain assets is null and void ab initio and therefore the financial impact of that null and void acquisition has been excluded from the previously referenced six month financials for the period ended June 30, 2024. Thus as previously stated, the Company has withdrawn all guidance and disclosures in which there has been consideration of the aforesaid null and void transaction.

 

Further to the previously reported issues related to the Company’s LZGI Asset Purchase Transaction, and in light of there being no out-of-court settlement reached to date with regards to the transaction, the Company’s Board has voted to proceed with arbitration to fully rescind ab initio the agreement and to pursue via the arbitration process the return of the 7.3 million ordinary shares in the Company issued and the $6.6 million in cash paid to date to LZGI as part of the transaction to the Company.

 

The Board further resolved that in the event the Company is successful in receiving back all or part of the 7.3 million ordinary shares related to this transaction, that these shares will be returned to the Company’s treasury, and the Company’s issued share capital will be reduced by the same number of shares.

 

The Board further resolved that in the event the Company is successful in receiving back all or part of the $6.6 million in cash related to this transaction, that this will be converted to Bitcoin as part of the Company’s Bitcoin treasury and the Company’s Bitcoin holdings will increase by the corresponding amount.

 

The Company is proceeding with its preparation and filing of its 2024 first half financial results, excluding the Fat Brian financials that would have been included had the transaction proceeded. The Company is also withdrawing any guidance or prior statements in which LZGI has been included. Therefore, the Company asks investors to not consider any impact of the aforementioned transaction in making any investment decisions regarding the Company.

 

The Company is therefore withdrawing any information with regard to LZGI, FatBrain and PrimeSource in all of its public disclosures, including but not limited to in Registration Statements and Annual Reports on Forms F-1, F-3 and S-8 and Annual Report on Form 20-F and the Current Reports on Form 6-K filed with the SEC on the following dates: March 15, 2024, March 18, 2024, March 19, 2024, March 21, 2024, April 19, 2024, April 25, 2024, April 26, 2024, May 15, 2024, May 17, 2024, June 6, 2024, June 25, 2024, June 28, 2024, July 15, 2024, July 19, 2024, July 24, 2024 and July 26, 2024.

 

Exhibit Index

 

Exhibit

 

99.1		Genius Group Announces Announces 177% NAV Growth in First Half of 2024
99.2		Genius Group Ltd. Reports Unaudited Financial Results for H1 2024

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

	GENIUS GROUP LIMITED
Date: December 27, 2024
	By:	/s/ Roger James Hamilton
	Name:	Roger James Hamilton
	Title:	Chief Executive Officer and Chairman (Principal Executive Officer)

 

 

Exhibit 99.1

 

 

Genius Group Announces 177% Net Asset Growth in First Half of 2024

 

Genius Group increases Net Asset Value to $54.6 million, reduces net loss per share by 74% in First Half of 2024.

Provides guidance of $75 million net asset value for Full Year with growth in Bitcoin Treasury.

 

SINGAPORE, December 27, 2024 - Genius Group Limited (NYSE American: GNS) (“Genius Group” or the “Company”), a leading AI-powered, Bitcoin-first education group, today announced its financial results for the first half of 2024.

 

“Following a rationalization of our operations in the first half of the year, we are extremely pleased to report a stronger balance sheet and a reduction in operational expenses for the first six months of 2024. This trend has continued in the second half, with the launch of our Bitcoin-first strategy and growth of our Bitcoin Treasury.” said Roger Hamilton, CEO of Genius Group.

 

Genius Group’s unaudited first half financial results are for the operations of the Company excluding financials related to the LZGI transaction signed in January 2024. As previously reported, the Company has voted to rescind that transaction, and the matter is currently in arbitration. The financial highlights for the first half of 2024 is prior to the launch of the Company’s Bitcoin Treasury strategy in the second half of 2024.

 

Financial Highlights for the First Half of 2024

 

	●	First half revenue of $4.9 million, compared to $11.8 million for first half of 2023, due to the spin off of Entrepreneur Resorts Limited and closure of University of Antelope Valley.
	●	First half operating expenses of $10.8 million, compared to $15.4 million for first half of 2023, due to the reduction in operational costs and rationalization of operations in anticipation at the time of the LZGI transaction.
	●	First half total loss of ($8.8) million, compared to ($11.4) million for first half of 2023, a reduction of 22.8%.
	●	First half loss per share of ($0.84) per basic and diluted share compared to loss per share of ($3.20) per basic and diluted share in first half of 2023, a reduction of 74%.
	●	$0.50 million cash and equivalents as of June 30, 2024, compared to $0.6 million as of December 31, 2023.
	●	First half total current assets of $41.2 million, compared to $9.6 million as of December 31, 2023, an increase of 329%, due to receivables from the reversal of the LZGI transaction.
	●	First half total assets of $78.3 million, compared to $43.2 as of December 31, 2023, an increase of 81%.
	●	First half net assets of $54.6 million, compared to $19.7 million as of December 31, 2023, an increase of 177%.

 

“While the company has put significant focus on various corporate actions, rationalizing its operations and reducing costs in 2024, we have done so while growing our core Edtech business.” said Gaurav Dama, CFO of Genius Group. “We are finishing 2024 with a strong balance sheet and look forward to moving towards a sustainable cash positive operating model anchored by our Bitcoin Treasury plan in 2025.”

 

 

Strategic and Operational Highlights for the First Half of 2023

 

	●	Closing $8.25 million public offering in January 2024
	●	Launched AI Avatar Tutor Team on GeniusU and expanding AI powered Genius University
	●	Launch of Genius City Singapore: Company’s 1st Sovereign AI Education Ecosystem
	●	Completion of Warrants Exercise for $3.8 Million Gross Proceeds in May 2024
	●	Launch of Abu Dhabi and Dubai Genius Cities, AI Hubs at Abu Dhabi University
	●	Rationalization of operations, including closure of University of Antelope Valley
	●	Announcement and subsequent decision to rescind asset purchase agreement with LZGI

 

Recent Strategic and Operational Highlights

 

	●	Completion of reverse stock split in August 2024
	●	Closing $150 million ATM offering
	●	Restructuring of the Board with appointment of Four new Board Members aligned with Company’s Bitcoin-first strategy.
	●	Launch of GeniusGroup.AI to Power Growth of Genius Cities and AI Education
	●	Bitcoin Treasury Reserve Strategy and invested $20M to acquire 214 Bitcoin
	●	Launched Sponsorship of Bitcoin MENA, Abu Dhabi and Bitcoin 2025, Las Vegas
	●	Sponsorship of Consensus Hong Kong and Toronto, and Paris Blockchain Week
	●	Acquisition of Bitcoin Learning Platform, XD Academy
	●	Launch announcement of Bitcoin Academy and Blockchain Academy in Q1 2025

 

Following the issues relating to the LZGI transaction, the Company previously withdrew guidance for the year 2024. With the restructuring and realignment of the company to its Bitcoin-first strategy in the second half of 2024, the Company anticipates its Net Asset Value to grow to $75 million for the full year, with over $20 million in its Bitcoin Treasury. The Company is committed to its current path towards profitable, cash positive operations and an initial Bitcoin Treasury target of 1,000 Bitcoin.

 

Other

 

The audit opinion of its audited consolidated financial statements for the fiscal year ended December 31, 2023, included in the Company’s Annual Form on 20F filed with the Securities and Exchange Commission on May 15, 2024, prepared as going concern. The Company’s unaudited condensed consolidated financial statements as of June 30, 2024 have been prepared on a going concern basis.

 

 

About Genius Group

 

Genius Group (NYSE: GNS) is a Bitcoin-first business delivering AI powered, education and acceleration solutions for the future of work. Genius Group serves 5.4 million users in over 100 countries through its Genius City model and online digital marketplace of AI training, AI tools and AI talent. It provides personalized, entrepreneurial AI pathways combining human talent with AI skills and AI solutions at the individual, enterprise and government level. To learn more, please visit www.geniusgroup.net.

 

Investor Notice

 

Investing in our securities involves a high degree of risk. Before making an investment decision, you should carefully consider the risks, uncertainties and forward-looking statements described in our most recent Annual Report on Form 20-F, as amended for the fiscal year ended December 31, 2023, filed with the SEC on May 15, 2024. If any of these risks were to occur, our business, financial condition or results of operations would likely suffer. In that event, the value of our securities could decline, and you could lose part or all of your investment. The risks and uncertainties we describe are not the only ones facing us. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations. In addition, our past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results in the future. See “Forward-Looking Statements” below.

 

Forward-Looking Statements

 

Statements made in this press release include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements can be identified by the use of words such as “may,” “will,” “plan,” “should,” “expect,” “anticipate,” “estimate,” “continue,” or comparable terminology. Such forward-looking statements are inherently subject to certain risks, trends and uncertainties, many of which the Company cannot predict with accuracy and some of which the Company might not even anticipate and involve factors that may cause actual results to differ materially from those projected or suggested. Readers are cautioned not to place undue reliance on these forward-looking statements and are advised to consider the factors listed above together with the additional factors under the heading “Risk Factors” in the Company’s Annual Reports on Form 20-F, as may be supplemented or amended by the Company’s Reports of a Foreign Private Issuer on Form 6-K. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events, new information or otherwise.

 

 

GENIUS GROUP LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

(In US Dollars)

 

		As of June 30, 2024				As of December 31, 2023
		(Unaudited)				(Audited)
Assets
Current Assets
Cash and cash equivalents			500,329				614,753
Restricted cash			711,026				711,026
Accounts receivable, net			1,834,827				1,868,931
Other receivables			36,875,097				50,465
Due from related parties			169,969				4,966,733
Inventories			574,464				755,284
Prepaid expenses and other current assets			489,296				666,673
Total Current Assets			41,155,301				9,633,865
Property and equipment, net			421,952				456,751
Other investments			4,454,338				28,698
Investments in joint venture			369				379
Other receivables			766,076				770,994
Due from related parties			5,602,470				5,628,298
Goodwill			11,405,622				11,425,148
Intangible assets, net			14,476,868				15,250,751
Other non-current assets			18,889				18,889
Total Assets			78,301,886				43,213,773
Liabilities and Shareholders’ Equity
Current Liabilities
Accounts payable			3,156,964				4,406,850
Accrued expenses and other current liabilities			2,575,505				2,419,205
Contract Liability			1,916,179				2,750,137
Income tax payable			225,663				174,738
Loans payable – current portion			4,185,652				2,467,656
Due to related parties			4,234,079				4,907,181
Convertible debt obligations, current portion			-				-
Short term debt			40,000				122,415
Total Current Liabilities			16,334,042				17,248,182
Due to related parties			1,807				1,820
Loans payable – non-current portion			1,343,664				254,455
Deferred tax liability			2,280,324				2,280,323
Derivative liabilities			3,714,000				3,714,000
Total Liabilities			23,673,838				23,498,780
Commitments and Contingencies Shareholders’ Equity:
Contributed capital			125,355,215				81,617,864
Reserves			(8,031,640	)			(8,459,565	)
Accumulated deficit			(68,362,461	)			(59,132,781	)
Capital and reserves attributable to owners of Genius Group Ltd			48,961,114				14,025,518
Non controlling interest			5,666,934				5,689,475
Total Shareholders’ Equity			54,628,048				19,714,993
Total Liabilities and Shareholders’ Equity			78,301,886				43,213,773

 

 

GENIUS GROUP LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(In US Dollars)

 

		June 30, 2024				June 30, 2023
		(Unaudited)				(Unaudited)
Revenue		$	4,880,309			$	11,795,714
Cost of revenue			(3,149,970	)			(5,593,340	)
Gross profit			1,730,339				6,202,374
Operating (Expenses) Income
General and administrative			(9,510,000	)			(13,672,668	)
Depreciation and amortization			(729,690	)			(919,568	)
Other operating income			19,238				1,213
Legal expenses			(531,252	)			(776,867	)
Loss from foreign currency transactions			(54,916	)			2,425
Total operating expenses			(10,806,620	)			(15,365,465	)
Loss from Operations			(9,076,281	)			(9,163,091	)
(Expense) Income
Interest expense, net			(223,614	)			(1,999,361	)
Other expense			-				(5,227	)
Other income			47,673				68,311
Total Other Expense			(175,941	)			(1,936,277	)
Loss Before Income Tax			(9,252,222	)			(11,099,368	)
Income Tax Benefit			-				324,666
Net Loss			(9,252,222	)			(10,774,702	)
Other comprehensive income:
Foreign currency translation			427,926				(599,818	)
Total Comprehensive Loss			(8,824,296	)			(11,374,520	)
Total Comprehensive Loss is attributable to:
Owners of Genius Group Ltd			(8,801,755	)			(10,746,977	)
Non controlling interest			(22,541	)			(627,543	)
Total Comprehensive Loss			(8,824,296	)			(11,374,520	)
Weighted-average number of shares outstanding, basic and diluted			11,009,270				3,366,848
Basic and diluted loss per share from continuing operations			(0.84	)			(3.20	)

 

 

GENIUS GROUP LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In US Dollars)

 

		For the Six months Ended
		June 30, 2024				June 30, 2023
		(Unaudited)				(Unaudited)
Cash Flows from Operating Activities
Net loss		$	(9,252,222	)		$	(10,774,702	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation			618,543				402,565
Depreciation and amortization			1,019,961				1,208,772
Provision for interest expense			223,614				1,277,162
Provision for doubtful accounts			(321,898	)			170,318
Gain on foreign exchange transactions			54,916				(2,425	)
Interest expense on lease liabilities			-				444,553
Changes in operating assets and liabilities:
Accounts receivable			34,104				842,905
Other receivable			(5,904,240	)			(3,556	)
Prepaid expenses and other current assets			(177,083	)			(147,408	)
Inventories			180,820				(169,751	)
Accounts payable			(1,249,885	)			551,988
Accrued expenses and other current liabilities			156,300				(417,574	)
Contract Liability			(833,958	)			(1,341,138	)
Deferred tax liability			-				(90,613	)
Income tax payable			50,926				(485,980	)
Other non-current asset			-				178
Total adjustments			(6,147,880	)			2,239,996
Net Cash Used in Operating Activities			(15,400,102	)			(8,534,706	)
Cash Flows from Investing Activities
Internally developed software			(239,156	)			(322,419	)
Purchase of property and equipment			(41,720	)			(111,151	)
Acquisitions			-				(2,299,231	)
Purchase of investment			(426,182	)			(20,000	)
Net Cash Used in Investing Activities			(707,058	)			(2,752,801	)
Cash Flows from Financing Activities
Amount due to/from related party, net			150,042				726,648
Interest paid			(223,614	)			-
Proceeds from convertible debt, net of issuance costs			-				8,923,994
Proceeds from equity issuances			13,457,414				-
Lease liabilities			-				(639,096	)
Proceeds from loan			4,970,269				-
Repayment of loan			(2,245,479	)			(170,000	)
Net Cash Provided by Financing Activities			16,108,632				8,841,546
Effect of Exchange Rate Changes on Cash			(115,896	)			(650,176	)
Net (Decrease) in Cash			(114,424	)			(3,096,135	)
Cash – Beginning of year			614,753				5,720,569
Cash – End of period			500,329				2,624,432

 

 

Summary Combined Consolidated Financial Data

 

		Unaudited Financials Six Months Ended (USD 000’s)								Audited Financials Year Ended (USD 000’s)
Summary Income Data:		June 30, 2024				June 30, 2023				December 31, 2023				December 31, 2022
Revenue			4,880				11,796				23,063				18,194
Cost of revenue			(3,150	)			(5,593	)			(11,127	)			(9,555	)
Gross profit			1,730				6,203				11,936				8,639
Other Operating Income			19				4				344				144
Operating Expenses			(10,826	)			(15,369	)			(48,347	)			(51,121	)
Operating Loss			(9,077	)			(9,162	)			(36,067	)			(42,338	)
Other income			48				68				32,981				418
Other Expense			(224	)			(2,005	)			(3,704	)			(15,151	)
Net Loss Before Tax			(9,253	)			(11,099	)			(6,790	)			(57,070	)
Tax Expense			-				325				1,079				1,063
Net Loss After Tax			(9,253	)			(10,774	)			(5,711	)			(56,007	)
Other Comprehensive Income			428				(600	)			(204	)			290
Total Loss			(8,825	)			(11,374	)			(5,915	)			(56,297	)
Net income per share, basic and diluted			(0.84	)			(3.20	)			(1.00	)			(24.7	)
Weighted-average number of shares outstanding, basic and diluted			11,009,270				3,366,848				5,550,197				2,263,437

 

 

		Unaudited Financials Six Months Ended, (USD 000’s)				Audited Financials Year Ended (USD 000’s)
		June 30, 2024				December 31, 2023				December 31, 2022
Summary Balance Sheet Data:
Total current assets			41,155				9,634				24,251
Total non-current assets			37,147				33,580				67,009
Total Assets			78,302				43,214				91,260
Total current liabilities			16,334				17,248				23,378
Total non-current liabilities			7,340				6,251				53,927
Total Liabilities			23,674				23,499				77,305
Total Shareholders’ Equity			54,628				19,715				13,955
Total Liabilities and Shareholders’ Equity			78,302				43,214				91,260

 

Non-IFRS Financial Measure

 

We have included Adjusted EBITDA because it is a key measure used by our management and board of directors to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget and to develop short- and long-term operational plans. In particular, the exclusion of certain expenses in calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core business.

 

We calculate Adjusted EBITDA as net profit / loss for the period plus income taxes and social contribution plus / minus finance revenue /expense result plus depreciation and amortization plus impairments plus revaluation adjustment of contingent liabilities plus share-based compensation expenses plus bad debt provision.

 

Derived from Financial Statements

 

		Genius Group Unaudited Financials Six Months Ended (USD 000’s)								Group Audited Financials Year Ended (USD 000’s)
		June 30, 2024				June 30, 2023				December 31, 2023				December 31, 2022
Net (Loss)			(9,253	)			(10,775	)			(5,711	)			(56,007	)
Tax Expense			-				(325	)			(1,079	)			1,064
Interest Expense, net			224				1,999				3,695				1,312
Depreciation and Amortization			1,020				1,209				3,271				2,351
Legal expense (non recurring)			531				-				1,178				-
Impairments			-				-				15,372				28,246
Revaluation adjustment of Contingent Liabilities			-				-				(32,775	)			13,838
Stock Based Compensation			619				403				10				1,309
Bad Debt Provision			210				170				2,822				1,509
Adjusted EBITDA			(6,650	)			(7,319	)			(13,217	)			(8,505	)

 

Contacts

 

Investors:

 

Investor Relations Team

Email: investor@geniusgroup.net

 

Media Contacts:

 

MZ Group - MZ North America

(949) 259-4987

GNS@mzgroup.us

www.mzgroup.us

 

 

Exhibit 99.2

 

Genius Group Ltd. Reports Unaudited Financial Results for H1 2024

 

	●	First half revenue of $4.9 million, compared to $11.8 million for first half of 2023, due to the spin off of Entrepreneur Resorts Limited and closure of University of Antelope Valley.
	●	First half operating expenses of $10.8 million, compared to $15.4 million for first half of 2023, due to the reduction in operational costs and rationalization of operations in anticipation at the time of the LZGI transaction.
	●	First half total loss of ($8.8) million, compared to ($11.4) million for first half of 2023, a reduction of 22.8%.
	●	First half loss per share of ($0.84) per basic and diluted share compared to loss per share of ($3.20) per basic and diluted share in first half of 2023, a reduction of 74%.
	●	$0.50 million cash and equivalents as of June 30, 2024, compared to $0.6 million as of December 31, 2023.
	●	First half total current assets of $41.2 million, compared to $9.6 million as of December 31, 2023, an increase of 329%, due to receivables from the reversal of the LZGI transaction.
	●	First half total assets of $78.3 million, compared to $43.2 million as of December 31, 2023, an increase of 81%.
	●	First half net assets of $54.6 million, compared to $19.7 million as of December 31, 2023, an increase of 177%.

 

The unaudited financials are prepared in accordance with the standard financial statement requirement without including notes to financials. The unaudited financial statements are not reviewed nor have any other services been performed by the Company auditor.

 

Singapore—(BUSINESS WIRE)— Genius Group Ltd. (NYSE American: GNS), a world-leading entrepreneur Edtech and education group, today announced financial results for the first half of 2024.

 

Key Business Metrics

 

We monitor the key business metrics and non-IFRS financial measures set forth below to help us evaluate our business and growth trends, set growth targets and budgets, and measure the effectiveness of our sales and marketing efforts. These key business metrics and non-IFRS financial measures are presented for supplemental informational purposes only, are not a substitute for IFRS financial measures, and may differ from similarly titled metrics or measures presented by other companies. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Key Business Metrics and Non-IFRS Financial Measures” for detailed descriptions of the measures and metrics shown below.

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

Overview

 

We are a Bitcoin-first business delivering AI powered, education and acceleration solutions for the future of work. Genius Group serves 5.4 million users in over 100 countries through its Genius City model and online digital marketplace of AI training, AI tools and AI talent. It provides personalized, entrepreneurial AI pathways combining human talent with AI skills and AI solutions at the individual, enterprise and government level. To learn more, please visit www.geniusgroup.net.Our mission is to disrupt the current education model with a personalized, student-centered, Bitcoin-first, AI powered lifelong learning curriculum that prepares our global community with the leadership, entrepreneurial and life skills to succeed in today’s market.

 

Our financial growth model is based on a combination of three main factors:

 

	1.	Growth of our Bitcoin Treasury and net assets, through the acquisition and custody of Bitcoin, which we believe will deliver long term value preservation to our shareholders.
	2.	Growth of our Edtech platforms GeniusU and GeniusGroup.AI, with its digital curriculum and global student base, via wholly owned curriculum, hosting partners, and their content.
	3.	Growth of our operations via acquisition of cash positive, profitable companies that align with our Bitcoin-first, AI powered education model.

 

To provide an accurate discussion and analysis of financial condition and results of operation, the financial reports provided and discussed below are presented for Audited financials provided for the financial years ended December 31, 2023 and 2022 and unaudited condensed financials provided for the six-month period ended June 30, 2024 and June 30, 2023.

 

 

Results of Operations

 

Period Ended June 30, 2024, Compared to Period Ended June 30, 2023

 

The below discussion and analysis are for the unaudited financials of June 30, 2024 compared to June 30, 2023. For simplicity, any reference to the first half of 2024 is with reference to the 6 months financials as of and for the period ended June 30, 2024, and any reference to the first half of 2023 is with reference to the 6 months financials as of and for the period ended June 30, 2023.

 

For clarity, each section below has separate paragraphs with discussion and analysis first for the Group unaudited financials, followed by discussion and analysis for the Genius Group pro forma financials (including the Acquisitions).

 

Revenue: Our Group revenues decreased from $11.8 million in first half of 2023 to $4.8 million in the first half of 2024. Campus revenue decreased by 100% from $2.83 million in first half of 2023 to $Nil in first half of 2024 as a result of spin off of Entrepreneur Resorts Limited. The reduction in the education revenue was mainly due to closure of UAV operations and reduction in demand of education courses as a result of business focus in H1 was mainly on closing the key acquisition.

 

Our two main revenue segments were Education Revenue and Campus Revenue. Education Revenue consists of Digital Education Revenue, where the courses are delivered virtually on GeniusU, and In-Person Education Revenue, where the courses are delivered to our students with the aid of our faculty in-person. Campus Revenue consists of revenue we generate from our locations through accommodation, food and beverage charges which will no longer be reported due to spin off of ERL in 2023. The following table shows the breakdown of this revenue into segments for both Genius Group, on a pro forma basis and unaudited basis:

 

		Genius Group Unaudited Financials Six Months Ended (USD 000’s)								Group Audited Financial Year Ended (USD 000’s)
		June 30, 2024				June 30, 2023				December 31, 2023				December 31, 2022
Digital Education Revenue			2,989				4,990				8,374				8,012
In-Person Education Revenue			1,891				3,972				10,238				5,544
Total Education Revenue			4,880				8,962				18,612				13,556
Campus Revenue			-				2,834				4,451				4,638
Total Revenue			4,880				11,796				23,063				18,194

 

Cost of Revenue: The Group’s cost of revenue was $3.1 million in first half of 2024 with $1.7 million in gross profit, giving us a 35.46% gross margin, compared to $5.59 million in first half of 2023 with $6.2 million in gross profit. Our cost of revenue primarily decreased because of closure of operations at UAV which resulted in ongoing cost of sales while the revenue remained low. Also, the cost of sales includes the depreciation expense which is not impacted by the lower revenue and impacting the gross profit margin for the Group.

 

Operating Expenses: The Group had a net operating expense of $10.80 million in the first half of 2024 compared to $15.36 million in first half of 2023. Approximately 60% of our operating expense is our staff costs, with the remaining in development costs, marketing, rental, legal and general expenses. The decrease in our operating expenses is the result exclusion of ERL (spin off) and reduction in operating expenses across the group due to cost control measures.

 

Non-IFRS Financial Measure — Adjusted EBITDA: We have included Adjusted EBITDA because it is a key measure used by our management and board of directors to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget and to develop short- and long-term operational plans. In particular, the exclusion of certain expenses in calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core business.

 

We calculate Adjusted EBITDA as net profit / loss for the period plus income taxes and social contribution plus / minus finance revenue /expense result plus depreciation and amortization plus impairments plus revaluation adjustment of contingent liabilities plus share-based compensation expenses plus bad debt provision.

 

 

Derived from Financial Statements

 

		Genius Group Unaudited Financials Six Months Ended (USD 000’s)								Group Audited Financials Year Ended (USD 000’s)
		June 30, 2024				June 30, 2023				December 31, 2023				December 31, 2022
Net (Loss)			(9,253	)			(10,775	)			(5,711	)			(56,007	)
Tax Expense			-				(325	)			(1,079	)			(1,064	)
Interest Expense, net			224				1,999				3,695				1,312
Depreciation and Amortization			1,020				1,209				3,271				2,351
Legal expenses (Non recurring)			531								1,178
Impairments			-				-				15,372				28,246
Revaluation adjustment of Contingent Liabilities			-				-				(32,775	)			13,838
Stock Based Compensation			619				403				10				1,309
Bad Debt Provision			210				170				2,822				1,509
Adjusted EBITDA			(6,650	)			(7,318	)			(13,217	)			(8,505	)

 

The Group had a negative Adjusted EBITDA of ($6.65) million in first half of 2024 compared to a negative of ($7.31) million in first half of 2023. The negative Adjusted EBITDA of ($6.64) million in first half of 2024 is partly due to further Group investments in development, marketing spend, increasing legal and professional services cost.

 

Cash and Cash Equivalents: The Group held $0.50 million in cash and cash equivalents as of June 30, 2024, and $0.61 million as of December 31, 2023.

 

Current Assets: The Group’s current assets increased from $9.6 million as of December 31, 2023 to $41.15 million as of June 30, 2024 with a current ratio of 2.52 in first half of 2024 compared to 0.56 as of December 31, 2023. The primary reason for increase is investment into acquisition of LZG International which is under the arbitration. The amount receivable from the transaction includes cancellation of shares ($29.3 million) and recovery of $6.5 million in cash payment.

 

Non-Current Assets: The Group’s non-current assets increased from $33.58 million as of December 31, 2023 to $37.14 million as of June 30, 2024. This is mainly due to the increase in investments in ERL by $4.4 million.

 

Current Liabilities: The Group’s current liabilities decreased from $17.24 million as of December 31, 2023 to $16.30 million as of June 30, 2024. The primary reason for reduction is repayment of payable balances to the external parties. The Company also repaid the Bridge loan in January 2024 and secured a new promissory note in April 2024.

 

Non-Current Liabilities: The Group’s non-current liabilities increased from $6.3 million as of December 31, 2023 to $7.3 million as of June 30, 2024. The increase was due to increase in loan payable balance of $1.34 million as of June 30, 2024 compared to $0.25 as of December 31, 2023 which is due to additional loan taken during the year.

 

Shareholders’ Equity: The Group’s shareholder’s equity increased from $19.71 million as of December 31, 2023 to $54.62 million as of June 30, 2024. The increase in equity is due to the loss of $9.15 million in the first half of 2024 and increase in capital by $3.68 million mainly due to issuance of shares for follow on fund raise, exercise of warrant, issuance of shares to LZG International and recording of stock- based compensation expenses.

 

 

Liquidity and Capital Resources

 

Our principal sources of liquidity are our cash and cash equivalents, short term investments, and cash generated from operations. Cash and cash equivalents and short-term investments consist mostly of cash on deposit with banks. As of June 30, 2024, we had cash and cash equivalents of $0.50 million maintained at various financial institutions compared to $0.61 million as of Dec 31, 2023.

 

Going Concern

 

Pursuant to IAS 1, Presentation of Financial Statements, the Company is required to and does evaluate at each annual and interim period whether there are conditions or events, considered in the aggregate, that raise substantial doubt about its ability to continue as a going concern within one year after the date that the consolidated financial statements are issued. Based on the definitions in the relevant accounting standards, and due to current liabilities exceeding current assets, management has determined that without additional capital raised, in the next twelve months, there is substantial doubt about the Company’s ability to continue as a going concern.

 

The Company’s unaudited condensed consolidated financial statements as of June 30, 2024 have been prepared on a going concern basis. Although the Company has taken, and plans to continue to take, proactive measures to enhance its liquidity position and provide additional financial flexibility, including discussions with lenders and bankers, there can be no assurance that these measures, including the timing and terms thereof, will be successful or sufficient.

 

The substantial doubt about the Company’s ability to continue as a going concern may negatively affect the price of the Company’s common stock, may impact relationships with third parties with whom the Company does business, including customers, vendors and lenders, may impact the Company’s ability to raise additional capital or implement its business plan.

 

Subsequent events

 

On August 15, 2024 the approved and effected the share consolidation in the ratio of 1:10.

 

On November 14, 2024, the Company reduced its debt by $5.2 million via the early repayment of the remaining principal balance and interest of the promissory note issued to it by Alto Master Opportunity Fund in April 2024, repaying the note 12 months early.

 

On December 13, 2024, the Board has voted to proceed with arbitration to fully rescind ab initio the agreement and to pursue via the arbitration process the return of the 7.3 million ordinary shares in the Company issued and the $6.6 million in cash paid to date to LZGI as part of the transaction to the Company. On December 17, 2024, the court has passed temporary injection on the shares enjoining LZG to participate and vote on any of the shareholders meetings of the Company.

 

On September 10, 2024, the Company received an approval from the Securities and Exchange Commission (SEC) and became effective on the registration statement F-3. Under this offering, Genius Group may offer and sell up to US$150 million of its ordinary shares on the New York Stock Exchange.

 

On November 14, 2024, the board has adopted a global “Bitcoin-first” strategy with Bitcoin to be the primary treasury reserve asset. Following the announcement, the Company has purchased 214 Bitcoin for the average net price of $93,586.

 

On December 6, 2024, the Company acquired Bitcoin and Blockchain Learning Platform, XD Academy for total consideration of $80,000. XD Academy’s learning platform and courses, which it is integrating into its Genius learning platform.

 

 

GENIUS GROUP LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

(In US Dollars)

 

		As of June 30, 2024				As of December 31, 2023
		(Unaudited)				(Audited)
Assets
Current Assets
Cash and cash equivalents			500,329				614,753
Restricted cash			711,026				711,026
Accounts receivable, net			1,834,827				1,868,931
Other receivables			36,875,097				50,465
Due from related parties			169,969				4,966,733
Inventories			574,464				755,284
Prepaid expenses and other current assets			489,296				666,673
Total Current Assets			41,155,301				9,633,865
Property and equipment, net			421,952				456,751
Other investments			4,454,338				28,698
Investments in joint venture			369				379
Other receivables			766,076				770,994
Due from related parties			5,602,470				5,628,298
Goodwill			11,405,622				11,425,148
Intangible assets, net			14,476,868				15,250,751
Other non-current assets			18,889				18,889
Total Assets			78,301,886				43,213,773
Liabilities and Shareholders’ Equity
Current Liabilities
Accounts payable			3,156,964				4,406,850
Accrued expenses and other current liabilities			2,575,505				2,419,205
Contract Liability			1,916,179				2,750,137
Income tax payable			225,663				174,738
Loans payable – current portion			4,185,652				2,467,656
Due to related parties			4,234,079				4,907,181
Short term debt			40,000				122,415
Total Current Liabilities			16,334,042				17,248,182
Due to related parties			1,807				1,820
Loans payable – non-current portion			1,343,664				254,455
Deferred tax liability			2,280,324				2,280,323
Derivative liabilities			3,714,000				3,714,000
Total Liabilities			23,673,838				23,498,780
Commitments and Contingencies Shareholders’ Equity:
Contributed capital			125,355,215				81,617,864
Reserves			(8,031,640	)			(8,459,565	)
Accumulated deficit			(68,362,461	)			(59,132,781	)
Capital and reserves attributable to owners of Genius Group Ltd			48,961,114				14,025,518
Non controlling interest			5,666,934				5,689,475
Total Shareholders’ Equity			54,628,048				19,714,993
Total Liabilities and Shareholders’ Equity			78,301,886				43,213,773

 

 

GENIUS GROUP LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(In US Dollars)

 

		June 30, 2024				June 30, 2023
		(Unaudited)				(Unaudited)
Revenue		$	4,880,309			$	11,795,714
Cost of revenue			(3,149,970	)			(5,593,340	)
Gross profit			1,730,339				6,202,374
Operating (Expenses) Income
General and administrative			(9,510,000	)			(13,672,668	)
Depreciation and amortization			(729,690	)			(919,568	)
Other operating income			19,238				1,213
Legal expenses			(531,252	)			(776,867	)
Loss from foreign currency transactions			(54,916	)			2,425
Total operating expenses			(10,806,620	)			(15,365,465	)
Loss from Operations			(9,076,281	)			(9,163,091	)
(Expense) Income
Interest expense, net			(223,614	)			(1,999,361	)
Other expense			-				(5,227	)
Other income			47,673				68,311
Total Other Expense			(175,941	)			(1,936,277	)
Loss Before Income Tax			(9,252,222	)			(11,099,368	)
Income Tax Benefit			-				324,666
Net Loss			(9,252,222	)			(10,774,702	)
Other comprehensive income:
Foreign currency translation			427,926				(599,818	)
Total Comprehensive Loss			(8,824,296	)			(11,374,520	)
Total Comprehensive Loss is attributable to:
Owners of Genius Group Ltd			(8,801,755	)			(10,746,977	)
Non controlling interest			(22,541	)			(627,543	)
Total Comprehensive Loss			(8,824,296	)			(11,374,520	)
Weighted-average number of shares outstanding, basic and diluted			11,009,270				3,366,848
Basic and diluted loss per share from continuing operations			(0.84	)			(3.20	)

 

 

GENIUS GROUP LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(In US dollars)

 

		Contributed Capital				Non- controlling Interest				Subscriptions Receivable				Foreign Currency				Reserves				Accumulated Deficit				Total Equity
Balance, January 1, 2023			110,534,000				6,794,617				(1,900,857	)			983,653				(33,917,367	)			(68,539,210	)			13,954,836
Net loss			—				(627,543	)			—				—				—				(10,147,159	)			(10,744,702	)
Foreign currency translation adjustments			—				—				—				(763,548	)			—				163,730				(599,818	)
Shares issued for conversion of convertible notes			6,994,299				—				—				—				—				—				6,994,299
Convertible loan adjustment for outstanding note, net			(3,837,395	)			—				—				—				—				—				(3,837,395	)
Shares issued by conversion from ERL and GeniusU			125,109				(125,109	)			—				—				—				—				—
Share based compensation			402,565				—				—				—				—				—				402,565
Balance, June 30, 2023			114,218,578				6,041,965				(1,900,857	)			220,105				(33,917,367	)			(78,522,639	)			6,139,785

 

		Contributed Capital				Non- controlling Interest				Subscriptions Receivable				Foreign Currency				Reserves				Accumulated Deficit				Total Equity
Balance, January 1, 2024			83,680,975				5,689,475				(2,063,111	)			(61,566	)			(8,398,000	)			(59,132,780	)			19,714,993
Net loss			—				(22,541	)			—				—				—				(9,229,681	)			(9,251,694	)
Foreign currency translation adjustments			—				—				—				427,926				—				—				427,926
Share issued for follow on offering			6,580,300				—				—				—				—				—				6,580,300
Share issued for exercise of warrants			5,990,930				—				—				—				—				—				5,990,930
Shares issued for acquisition of FatBrain (to be cancelled)			29,327,892				—				—				—				—				—				29,327,892
Share based compensation			618,543				—				—				—				—				—				618,543
Transfer of shares to nominee account			(666,498	)			—				—				—				—				—				(666,498	)
H1 2024 Share Plan			1,886,184				—				—				—				—				—				1,886,184
Balance, June 30, 2024			127,418,326				5,666,934				(2,063,111	)			366,360				(8,398,000	)			(68,362,461	)			54,628,048

 

 

GENIUS GROUP LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In US Dollars)

 

		For the Six months Ended
		June 30, 2024				June 30, 2023
		(Unaudited)				(Unaudited)
Cash Flows from Operating Activities
Net loss		$	(9,252,222	)		$	(10,774,702	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation			618,543				402,565
Depreciation and amortization			1,019,961				1,208,772
Provision for interest expense			223,614				1,277,162
Provision for doubtful accounts			(321,898	)			170,318
Gain on foreign exchange transactions			54,916				(2,425	)
Interest expense on lease liabilities			-				444,553
Changes in operating assets and liabilities:
Accounts receivable			34,104				842,905
Other receivable			(5,904,240	)			(3,556	)
Prepaid expenses and other current assets			(177,083	)			(147,408	)
Inventories			180,820				(169,751	)
Accounts payable			(1,249,689	)			551,988
Accrued expenses and other current liabilities			156,300				(417,574	)
Contract Liability			(833,958	)			(1,341,138	)
Deferred tax liability			-				(90,613	)
Income tax payable			50,926				(485,980	)
Other non-current asset			-				178
Total adjustments			(6,147,880	)			2,239,996
Net Cash Used in Operating Activities			(15,400,102	)			(8,534,706	)
Cash Flows from Investing Activities
Internally developed software			(239,156	)			(322,419	)
Purchase of property and equipment			(41,720	)			(111,151	)
Acquisitions			-				(2,299,231	)
Purchase of investment			(426,182	)			(20,000	)
Net Cash Used in Investing Activities			(707,058	)			(2,752,801	)
Cash Flows from Financing Activities
Amount due to/from related party, net			150,042				726,648
Interest paid			(223,614	)			-
Proceeds from convertible debt, net of issuance costs			-				8,923,994
Proceeds from equity issuances			13,457,414				-
Issuance from convertible debt			-				-
Lease liabilities			-				(639,096	)
Proceeds from loan			4,970,269				-
Repayment of loan			(2,245,479	)			(170,000	)
Net Cash Provided by Financing Activities			16,108,632				8,841,546
Effect of Exchange Rate Changes on Cash			(115,896	)			(650,096	)
Net (Decrease) in Cash			(114,424	)			(3,096,135	)
Cash – Beginning of year			614,753				5,720,569
Cash – End of period			500,329				2,624,432

 

 

Summary Combined Consolidated Financial Data

 

		Unaudited Financials Six Months Ended (USD 000’s)								Audited Financials Year Ended (USD 000’s)
Summary Income Data:		June 30, 2024				June 30, 2023				December 31, 2023				December 31, 2022
Revenue			4,880				11,796				23,063				18,194
Cost of revenue			(3,150	)			(5,593	)			(11,127	)			(9,555	)
Gross profit			1,730				6,203				11,936				8,639
Other Operating Income			19				4				344				144
Operating Expenses			(10,826	)			(15,369	)			(48,347	)			(51,121	)
Operating Loss			(9,077	)			(9,162	)			(36,067	)			(42,338	)
Other income			48				68				32,981				418
Other Expense			(224	)			(2,005	)			(3,704	)			(15,151	)
Net Loss Before Tax			(9,253	)			(11,099	)			(6,790	)			(57,070	)
Tax Benefit			-				325				1,079				1,063
Net Loss After Tax			(9,253	)			(10,774	)			(5,711	)			(56,007	)
Other Comprehensive Income			428				(600	)			(204	)			(290	)
Total Loss			(8,825	)			(11,374	)			(5,915	)			(56,297	)
Net income per share, basic and diluted			(0.84	)			(3.20	)			(1.00	)			(24.70	)
Weighted-average number of shares outstanding, basic and diluted			11,009,270				3,366,848				5,550,197				2,263,437

 

		Unaudited Financials Six Months Ended, (USD 000’s)				Audited Financials Year Ended, (USD 000’s)
		June 30, 2024				December 31, 2023				December 31, 2022
Summary Balance Sheet Data:
Total current assets			41,155				9,634				24,251
Total non-current assets			37,147				33,580				67,009
Total Assets			78,302				43,214				91,260
Total current liabilities			16,334				17,248				23,378
Total non-current liabilities			7,340				6,251				53,927
Total Liabilities			23,674				23,499				77,305
Total Shareholders’ Equity			54,628				19,715				13,955
Total Liabilities and Shareholders’ Equity			78,302				43,214				91,260

 

 

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