Financial Report: Overview of Preferred and Common Stock Holdings and Capital Structure

Press release · 05/29 06:21
Financial Report: Overview of Preferred and Common Stock Holdings and Capital Structure

Financial Report: Overview of Preferred and Common Stock Holdings and Capital Structure

The financial report highlights the company’s performance over the past year, with key events including the issuance of Series E, F, G, and B preferred stocks, as well as common stock and additional paid-in capital. The report also provides an overview of retained earnings and other financial metrics, offering insights into the company’s financial health and growth.

Overview

AITX was incorporated in Florida in 2010 and reincorporated into Nevada in 2015. Its fiscal year ends on February 28⁄29. AITX is located in Ferndale, Michigan and operates in the technology sector.

Results of Operations

Period Year Ended February 29, 2024 Year Ended February 28, 2023 Change
Revenues $2,227,559 $1,331,956 +67%
Gross profit $1,096,457 $653,883 +68%
Operating expenses $15,085,869 $13,344,563 +13%
Loss from operations $(13,989,412) $(12,690,680) +10%
Other income/expense $(6,719,304) $(5,418,777) -24%
Net loss $(20,708,716) $(18,109,457) +14%

Revenue

Total revenue grew 67% year-over-year to $2.2 million. Growth was driven by a 116% increase in rental activities revenue to $1.6 million as the company expanded its product line and customer base.

Expenses

Operating expenses increased 13% to $15.1 million. Research and development spending fell 21%, but general and administrative costs rose 17%. Higher admin costs were mainly due to a $1.1 million increase in CEO stock-based compensation and a $731,447 increase in CEO bonus pay. Depreciation and amortization also rose 79% on more company assets.

Profitability

Despite the revenue growth, higher operating costs led to a wider net loss of $20.7 million compared to $18.1 million last year. The increase in other expenses, including $1.3 million more interest costs, also contributed to the bottom line loss.

Liquidity

AITX used $13 million in operating activities during the year and ended February with just $106,000 in cash. Its working capital deficit widened significantly to $18.1 million. The company relied on new financing and equity raises for funding. Management aims to improve liquidity through revenue growth, equity proceeds, and non-convertible debt.

Outlook

The increase in rental activity revenue and relationships is a positive sign, but profitability remains a major challenge. Bringing down costs and securing additional financing will be key for AITX’s outlook in the coming year. The CEO’s control of voting shares also presents a risk. Overall the company faces substantial uncertainty, although management expresses confidence it can maintain operations.