Arcadia Biosciences Inc
For the period ended Jun 30, 2024. Filed Aug 13, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 13, 2024
RKDA$0.16-3.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-13.
0000950170-24-058563
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-13.
0000950170-24-096439
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 106 previous paragraphs and 107 current paragraphs.
50 unchanged; 21 reworded; 32 added; 30 removed; 5 previous and 4 current paragraphs rearranged.
Tables are not compared: 3 previous and 4 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (32)
Current report
On May 16, 2024, the Company sold the GoodWheat™ brand to Above Food Corp. ("Above Food") for net consideration of $3.7 million. Refer to Note 6 to the condensed consolidated financial statements for further details of the transaction.
Current report
On May 14, 2024, the Company sold its non-GMO Resistant Starch ("RS") durum wheat trait to longtime partner Corteva AgriScience ("Corteva"). Under the terms of the agreement, Arcadia retained certain rights to use the RS durum wheat trait. The Company received $4.0 million in cash payment from Corteva during the three months ended June 30, 2024 and recorded a gain of the same amount as the trait had no carrying value on the condensed consolidated statement of operations and comprehensive income (loss) related to the transaction. Refer to Note 8 to the condensed consolidated financial statements for further details of the partnership and transaction
Current report
Wheat Traits
Current report
RG Wheat
Current report
Many consumers are interested in reducing levels of gluten in their diet. Critically, for some, this is due to having Celiac disease ("CD"), an autoimmune disease that impacts many people worldwide with estimates from 1% of the population in Europe to 3.5% in Mexico. Furthermore, non-celiac gluten sensitivity ("NCGS") impacts an estimated additional 6% of the population. Both CD and NCGS are characterized by sensitivity to dietary gluten. The only effective treatment of CD and NCGS requires removal of gluten sources from the diet. Since required adherence to a gluten-free diet is extremely difficult to accomplish for average consumers, efforts to develop alternative approaches are needed.
Current report
Arcadia is continuing to advance a new wheat variety with reduced gluten levels. Our proprietary, non-GMO wheat variety developed using advanced screening and plant breeding techniques have reduced allergenic glutens and increased essential amino acids such as lysine, along with all the other health benefits of high protein wheat. Importantly, this variety also delivers impressively high fiber content at approximately 14 grams per serving compared to 2-3 grams per serving of traditional wheat, providing additional value to health-conscious consumers as well as optionality as we advance the commercialization of this wheat trait through licensees and research partners.
Current report
Improved Shelf Life of Whole Grain Flour
Current report
The United States Department of Agriculture recommends that “at least one serving of grains per day must be whole grain-rich” due to evidence that a diet containing whole grains provides a multitude of benefits, including lower risk of obesity, cardiovascular disease, and type-2 diabetes. Despite these health benefits, consumption of whole grain products is negatively affected by the bitter and rancid flavors and odors that accumulate in whole wheat flour after milling. Our improved stability and flavor wheat lines greatly reduced the production of rancid and bitter compounds in milled whole grain flour as it progresses through the supply chain. Whole wheat flour from these lines is being tested further for sensory characteristics and improved shelf-life stability. This new trait could help improve the shelf life and flavor profile of whole grain products, thus reducing formulation costs and increasing consumer preference and palatability for whole grains.
Current report
License revenues
Current report
License revenues consist of up-front, nonrefundable license fees, annual license fees, and subsequent milestone payments that we receive under our license agreements. Revenue generated from up-front license fees are recognized upon execution of the agreement. We recognize annual license fees when it is probable that a material reversal will not occur.
Current report
Cost of revenues primarily relates to the sale of Zola products and consists primarily of product and freight costs. Adjustments or write-downs to inventory are also included in cost of revenues.
Current report
Gain on sale of intangible assets consists of the gain on sale of our RS durum wheat trait to Corteva.
Current report
Other income (loss), net
Current report
Cost of revenues decreased by $17,000, or 3%, during the three months ended June 30, 2024 compared to the same period in 2023 driven by lower freight cost.
Current report
During the three months ended June 30, 2024, the Company realized a gain of $4.0 million related to the sale of its RS durum wheat trait to Corteva. There was no such gain recorded during the three months ended June 30, 2023.
Current report
Selling, general, and administrative expenses increased by $609,000, or 29%, during the three months ended June 30, 2024 compared to the same period in 2023 primarily driven by higher consulting and legal expenses related to the Corteva and Above Food transactions in 2024.
Current report
During the three months ended June 30, 2024, the Company recognized interest income of $150,000, of which $96,000 was related to discount amortization and accrued interest on the promissory note from Above Food. The remaining difference was related to interest from investments. During the three months ended June 30, 2023, the Company recognized interest income of $207,000 from investments.
Current report
Other income (loss), net
Current report
During the three months ended June 30, 2024, the Company recognized other income of $150,000, of which $117,000 was related to realized gains on investments. During the three months ended June 30, 2023, the Company recognized other loss of $13,000.
Current report
Net loss from discontinued operations for Body Care was $0 and $330,000 during the three months ended June 30, 2024 and 2023 respectively. Net loss from discontinued operations for GoodWheat was $789,000 and $2.0 million during the three months ended June 30, 2024 and 2023, respectively. See Note 1 to the condensed consolidated financial statements for further information on discontinued operations.
Current report
Comparison of the Six Months Ended June 30, 2024 and 2023
Current report
Product revenues accounted for 100% of total revenues during the six months ended June 30, 2024. Product revenues decreased $76,000, or 3%, during the six months ended June 30, 2024 compared to the same period in 2023 driven by a decrease in GLA sales that was partially offset by an increase in Zola sales.
Current report
Cost of revenues decreased by $74,000, or 6%, during the six months ended June 30, 2024 compared to the same period in 2023 driven by lower freight cost.
Current report
Research and development
Current report
During the six months ended June 30, 2024, the Company realized a gain of $4.0 million related to the sale of its RS durum wheat trait to Corteva. There was no such gain recorded during the six months ended June 30, 2023.
Current report
Selling, general, and administrative
Current report
Selling, general, and administrative expenses increased by $74,000, or 2%, during the six months ended June 30, 2024 compared to the same period in 2023 primarily driven by higher consulting and legal expenses related to the Corteva and Above Food transactions in 2024.
Current report
During the six months ended June 30, 2024, the Company recognized interest income of $195,000, of which $96,000 was related to discount amortization and accrued interest on the promissory note from Above Food. The remaining difference was related to interest from investments. During the six months ended June 30, 2023, the Company recognized interest income of $405,000 from investments.
Current report
During the six months ended June 30, 2024, the Company recognized other income of $153,000, of which $117,000 was related to realized gains on investments. During the six months ended June 30, 2023, the Company recognized other income of $19,000.
Current report
Valuation loss on March 2023 PIPE
Current report
Net loss from discontinued operations for Body Care was $0 and $511,000 during the six months ended June 30, 2024 and 2023, respectively. Net loss from discontinued operations for GoodWheat was $2.3 million and $3.8 million during the six months ended June 30, 2024 and 2023, respectively. See Note 1 to the condensed consolidated financial statements for further information on discontinued operations.
Current report
Cash provided by investing activities for the six months ended June 30, 2024 consisted of proceeds of $162,000 from the sale of property and equipment, proceeds from the sale of investments of $2.5 million, proceeds from the sale of our RS durum wheat trait of $4.0 million, offset by cash paid related to the GoodWheat sale of $2.0 million and $16,000 of purchases of property and equipment.
Removed paragraphs (30)
Previous report
It is estimated by the U.S. Department of Agriculture (“USDA”), that approximately one-fifth of the FDA recommended calories consumed by people in the US are from wheat. Therefore, the market opportunity for nutritional improvements in wheat are significant. Considering that most people today are not getting enough fiber or protein in their daily diets, the superior nutrient density of our non-GMO GoodWheat™ (“GoodWheat”) technology can improve the dietary intake of average consumers, by increasing their fiber and protein consumption without changing the way they eat.
Previous report
Arcadia Wellness, LLC
Previous report
Most Americans suffer from a significant fiber deficiency. The recommended daily value of fiber is 25g for women and children, and 38g for men according to the May 2021 Food and Health Survey by the International Food Information Council. However, less than 10 percent of women and less than 3 percent of men get enough fiber in their daily diets.
Previous report
Our GoodWheat portfolio of better-for-you products addresses these needs as they are naturally higher in fiber and protein than traditional wheat without sacrificing on taste or texture.
Previous report
GoodWheat™ Pasta
Previous report
In June 2022, we launched our GoodWheat pasta in five varieties – penne, spaghetti, fettuccine, elbows and rotini – in select retailers nationwide and on Amazon. Our pasta delivers 4 times the fiber of traditional wheat pasta with 9g of protein per serving and no sacrifice on taste. In fact, our research shows that GoodWheat pasta scores at parity on taste with leading wheat pasta competitors and significantly outscores market leading vegetable-based pastas. Made with only our USA farm grown wheat, GoodWheat pasta meets consumers’ preference for clean labels and transparent sourcing. And, in December of 2022, GoodWheat received the American Heart Association’s Heart-Check mark on all of our pasta products. With its high fiber, lower sodium and zero saturated fat, GoodWheat meets the criteria for a heart-healthy pasta and provides consumers with a better-for-you option that delivers superior nutrition with the taste and texture of traditional pasta.
Previous report
GoodWheat™ Pancakes and Waffle Mixes
Previous report
In August 2023, we launched our GoodWheat into the breakfast category with new, better-for-you pancake and waffle mixes as well as single-serve Quikcakes™. Our new mixes are made with simple ingredients and Arcadia’s proprietary wheat grain, which is naturally higher in fiber and protein than traditional wheat. GoodWheat pancake and waffle mixes are sold in resealable, multi-serve pouches, with each serving delivering 8 times the fiber of traditional pancake mix and 5 grams of protein. Our multi-serve mixes are available in 3 classic varieties, including Buttermilk, Chocolate Chocolate Chip and Apple Cinnamon. GoodWheat Quikcakes are an innovative, single-serve instant pancake that is a great option for busy mornings – you simply pour one packet into a bowl, add water and microwave for 90 seconds. Quikcakes have 11 times the fiber of traditional single-serve pancake mixes and contain 7 grams of protein per serving. Quikcakes are available in 3 flavors, including Buttermilk, Chocolate Chocolate Chip and Confetti.
Previous report
GoodWheat™ Mac and Cheese
Previous report
In November 2023, we announced the third GoodWheat category, Mac and Cheese. Our Mac and Cheese is made with real cheese and contains no artificial flavors, dyes or preservatives and are available in three varieties: Classic Cheddar, White Cheddar and Three Cheese. GoodWheat Mac and Cheese packs in the most fiber of any brand in the category, 4 times more than the leading brand. In fact, one serving of GoodWheat Mac and Cheese has the same fiber as two servings of oatmeal, or two and a half servings of broccoli! And, just like our pasta and pancake mixes, GoodWheat Mac and Cheese is higher in protein than the leading brand, with 12 grams of protein per serving.
Previous report
Revenues
Previous report
Cost of revenues
Previous report
Cost of revenues primarily relates to the sale of GoodWheat and Zola products and consists of the cost of raw materials, including internal and third-party services costs related to procuring, processing, formulating, packaging and shipping our products, as well as in-licensing and royalty fees, any adjustments or write-downs to inventory or prepaid production costs.
Previous report
Loss (Gain) on sale of property and equipment
Previous report
Loss (Gain) on sale of property and equipment includes losses or gains realized from the sale of tangible assets sold below or above their net book value.
Previous report
Interest income
Previous report
Net loss from discontinued operations
Previous report
Revenues
Previous report
Cost of revenues
Previous report
Cost of revenues increased by $132,000, or 19%, during the three months ended March 31, 2024 compared to the same period in 2023 primarily related to grain sales. Gross profit, calculated as total revenues less cost of revenues, was $435,000 and $544,000 during the three months ended March 31, 2024 and 2023, respectively. The decrease in gross profit is related to higher cost of revenues driven by the grain sale during the three months ended March 31, 2024.
Previous report
Loss (Gain) on sale of property and equipment
Previous report
During the three months ended March 31, 2024, the Company sold property and equipment for net proceeds below book value by $2,000. During the three months ended March 31, 2023, the Company sold property and equipment for net proceeds exceeding book value by $19,000.
Previous report
Selling, general, and administrative expenses decreased by $882,000, or 22%, during the three months ended March 31, 2024 compared to the same period in 2023 primarily driven by decreases in employee compensation and marketing expenses.
Previous report
Interest income
Previous report
During the three months ended March 31, 2024, the Company recognized interest income of $45,000 from investments as compared to $198,000 during the same period in 2023.
Previous report
Other income, net
Previous report
During the three months ended March 31, 2024, the Company recognized other income of $3,000 as compared to $32,000 during the same period in 2023.
Previous report
Issuance and offering costs
Previous report
Net loss from discontinued operations
Previous report
Net loss from discontinued operations was $181,000 during the three months ended March 31, 2023. See Note 1 to the condensed consolidated financial statements for further information on discontinued operations.
Reworded paragraphs (21)
Previous wording
We are a producer and marketer of innovative, plant-based food and beverage products. Our history as a leader in science-based approaches to developing high value crop improvements, primarily in wheat, designed to enhance farm economics by improving the performance of crops in the field, as well as their value as food ingredients, has laid the foundation for our path forward. We have used non-genetically modified advanced breeding techniques to develop these proprietary innovations, which we have commercialized through the sales of seed and grain, food ingredients and products, trait licensing and royalty agreements. The acquisition of the assets of Live Zola, LLC ("Zola") added coconut water to our portfolio of products.
Current wording
We are a producer and marketer of innovative, plant-based products. Our history as a leader in science-based approaches to developing high value crop improvements, primarily in wheat, has laid the foundation for our proprietary innovations, which we have commercialized through the sales of seed, grain, food ingredients and products, and through trait licensing and royalty agreements. The acquisition of the assets of Live Zola, LLC ("Zola") in May 2021 added coconut water to our portfolio of products.
Previous wording
In May 2021, our wholly owned subsidiary Arcadia Wellness, LLC (“Arcadia Wellness” or “AW”), acquired the businesses of Eko, Lief, and Zola. The acquisition included Saavy Naturals™, a line of natural body care products, Soul Spring™, a CBD-infused botanical therapy brand in the natural category, and ProVault™, a THC-free CBD sports performance formula made with natural ingredients, providing effective support and recovery for athletes (collectively "body care brands"). Also included in the purchase is Zola, a coconut water sourced exclusively with sustainably grown coconuts from Thailand.
Current wording
In May 2021, the Company’s wholly owned subsidiary Arcadia Wellness, LLC (“Arcadia Wellness” or “AW”) acquired the businesses of Eko Holdings, LLC, Lief, LLC, and Zola. The acquisition included Saavy Naturals™, a line of natural body care products, Soul Spring™, a CBD-infused botanical therapy brand in the natural category, and ProVault™, a THC-free CBD sports performance formula made with natural ingredients, providing effective support and recovery for athletes (collectively, "body care brands"). Also included in the purchase was Zola, a coconut water sourced exclusively with sustainably grown coconuts from Thailand. In July 2022, the Company entered into an agreement to license Saavy Naturals to Radiance Beauty and Wellness, Inc. ("Radiance Beauty"). In July 2023, management made the decision to exit the remaining body care brands, Soul Spring and ProVault, as a result of continued pressure on the CBD market due to regulatory uncertainty. Body care operations ceased during the third quarter of 2023.
Previous wording
Accelerate the monetization of our wheat trait portfolio. Our proprietary intellectual property ("IP") with multiple non-GMO wheat traits have clear functional benefits, which we utilized to launch the GoodWheat brand into multiple categories. We believe our wheat provides a compelling point of difference and we will continue to evaluate ways to extract value from our proprietary technology.
Current wording
Monetization of our wheat trait portfolio. Our proprietary intellectual property ("IP") with multiple non-GMO wheat traits have clear functional benefits, which we utilized to launch the GoodWheat brand into multiple categories. We believe our wheat provides a compelling point of difference and we will continue to evaluate ways to extract value from our proprietary technology.
Previous wording
Evaluate M&A opportunities. We intend to evaluate potential asset sales, mergers, acquisitions and other strategic opportunities. We believe there is a significant opportunity to integrate our wheat IP into larger businesses and drive shareholder value.
Current wording
Evaluate M&A opportunities. We intend to evaluate potential asset sales, mergers, acquisitions and other strategic opportunities.
Previous wording
Zola is a pure, natural, 100% coconut water with a crisp, clean taste that’s lightly sweet and refreshing. Naturally hydrating and never from concentrate, Zola is Non-GMO Project Verified and only contains 60 calories per serving. In taste tests, Zola beats competitors 2 to 1 and is the best-tasting way to rehydrate, reset and reenergize.
Current wording
Founded in 2002, Zola became part of the Arcadia family of brands in May 2021. Sourced from Thailand, Zola is a pure, natural, 100% coconut water with a crisp, clean taste that’s slightly sweet and refreshing. Naturally hydrating and rich in electrolytes, Zola is Non-GMO Project Verified and only contains 60 calories per serving. In taste tests, Zola beat competitors 2 to 1 and is the best tasting way to rehydrate, reset and reenergize. Zola flavors include original, original with pulp, and espresso, and in May 2024, we added lime and pineapple.
Previous wording
As mentioned above, the Company exited the body care brands and ceased its operations during the third quarter of 2023. In accordance with the provisions of ASC 205-20, the Company has separately reported the assets and liabilities of the discontinued operations in the condensed consolidated balance sheets and the results of the discontinued operations as a separate component of loss on the condensed consolidated statements of operations and comprehensive loss for all periods presented. See Note 1 to the condensed consolidated financial statements for further information on discontinued operations.
Current wording
As mentioned above, the Company exited the GoodWheat and body care brands. In accordance with the provisions of ASC 205-20, the Company has separately reported the assets and liabilities of the discontinued operations in the condensed consolidated balance sheets and the results of the discontinued operations as separate components on the condensed consolidated statements of operations and comprehensive income (loss) for all periods presented. See Note 1 to the condensed consolidated financial statements for further information on discontinued operations.
Previous wording
Product revenues consist primarily of sales of GoodWheat, Zola and GLA products. We recognize revenue from product sales when control of the product is transferred to third-party distributors and manufacturers, collectively “our customers,” which generally occurs upon delivery. Revenues fluctuate depending on the timing of shipments of product to our customers and are reported net of estimated chargebacks, returns and losses.
Current wording
Product revenues consist primarily of sales of Zola and GLA products. We recognize revenue from product sales when control of the product is transferred to third-party distributors and manufacturers, collectively “our customers,” which generally occurs upon delivery. Revenues fluctuate depending on the timing of shipments of product to our customers and are reported net of estimated chargebacks, returns and losses.
Previous wording
Other income, net consists of miscellaneous income.
Current wording
Other income (loss), net consists of miscellaneous income or loss.
Previous wording
Net loss from discontinued operations represents results of operations related to the discontinued body care brands. See Note 1 to the condensed consolidated financial statements for further information on discontinued operations.
Current wording
Net loss from discontinued operations represents results of operations related to the discontinued GoodWheat and body care brands. See Note 1 to the condensed consolidated financial statements for further information on discontinued operations.
Previous wording
Product revenues accounted for 100% of total revenues during the three months ended March 31, 2024 and 2023. Product revenues increased $23,000, or 2%, during the three months ended March 31, 2024 compared to the same period in 2023 driven by GoodWheat and Zola sales, partially offset by higher costs related to new distribution.
Current wording
Product revenues accounted for 100% of total revenues during the three months ended June 30, 2024. Product revenues increased $19,000, or 1%, during the three months ended June 30, 2024 compared to the same period in 2023 driven by an increase in Zola sales, which was offset by a decrease in GLA sales.
Previous wording
Research and development expenses decreased by $87,000, or 24%, during the three months ended March 31, 2024 compared to the same period in 2023 primarily related to lower consulting fees during the three months ended March 31, 2024.
Current wording
Research and development expenses decreased by $17,000, or 63%, during the three months ended June 30, 2024 compared to the same period in 2023 primarily related to lower consulting fees.
Previous wording
The change in the estimated fair value of common stock warrant and option liabilities was $593,000 during the three months ended March 31, 2024 related to the change in the estimated fair value of the liability classified preferred investment options issued in connection with the March 2023 PIPE and August 2022 Registered Direct Offering financing transactions. The change in the estimated fair value of common stock warrant and option liabilities was $940,000 during the three months ended three months ended March 31, 2023 related to the change in the estimated fair value of the liability classified preferred investment options issued in connection with the March 2023 PIPE and August 2022 Registered Direct Offering financing transactions.
Current wording
The change in the estimated fair value of common stock warrant and option liabilities resulted in a loss of $430,000 during the three months ended June 30, 2024 related to the change in the estimated fair value of the liability classified preferred investment options issued in connection with the March 2023 PIPE and August 2022 Registered Direct Offering financing transactions. The change in the estimated fair value of common stock warrant and option liabilities resulted in a gain of $4.4 million during the three months ended June 30, 2023 related to the change in the estimated fair value of the liability classified preferred investment options issued in connection with the March 2023 PIPE and August 2022 Registered Direct Offering financing transactions.
Previous wording
During the three months ended March 31, 2024, the Company recognized impairment of property and equipment held for sale of $36,000. There was no such impairment of property and equipment during the three months ended March 31, 2023.
Current wording
During the six months ended June 30, 2024, the Company recognized impairment of property and equipment held for sale of $36,000. There was no such impairment of property and equipment during the six months ended June 30, 2023.
Previous wording
Issuance and offering costs were $430,000 during the three months ended March 31, 2023 related to the March 2023 PIPE financing transaction.
Current wording
Issuance and offering costs were $430,000 during the six months ended June 30, 2023 and were related to the liability classified options issued in the March 2023 PIPE financing transaction.
Previous wording
We have funded our operations primarily with the net proceeds from our private and public offerings of our equity securities and debt, as well as proceeds from the sale of our products and payments under license agreements. Our principal use of cash is to fund our operations, which are primarily focused on commercializing our products. Our contractual obligations are primarily related to our operating leases for facilities, land and equipment. As of March 31, 2024, we had cash and cash equivalents of $3.3 million and short-term investments of $5.2 million. For the three months ended March 31, 2024, the Company had net losses of $2.4 million and net cash used in operations of $3.2 million. For the twelve months ended December 31, 2023, the Company had net losses of $14.0 million and net cash used in operations of $15.3 million.
Current wording
We have funded our operations primarily with the net proceeds from our private and public offerings of our equity securities and debt, as well as proceeds from the sale of our products and payments under license agreements. Our principal use of cash is to fund our operations, which are primarily focused on commercializing our products. Our contractual obligations are primarily related to our operating leases for facilities, land and equipment. As of June 30, 2024, we had cash and cash equivalents of $5.5 million, short-term investments of $2.6 million and current note receivable of $1.8 million. For the six months ended June 30, 2024, the Company had net losses of $1.4 million and net cash used in operations of $5.7 million. For the twelve months ended December 31, 2023, the Company had net losses of $14.0 million and net cash used in operations of $15.3 million.
Previous wording
We believe that our existing cash and cash equivalents and short-term investments will not be sufficient to meet our anticipated cash requirements for at least the next 12-18 months from the issuance date of these financial statements, and thus raises substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Current wording
We believe that our existing cash and cash equivalents, short-term investments and current note receivable will not be sufficient to meet our anticipated cash requirements for at least the next 12-18 months from the issuance date of these financial statements, and thus raises substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Previous wording
Cash used in operating activities for the three months ended March 31, 2024, was $3.2 million. With respect to our net loss of $2.4 million, non-cash charges including $51,000 of depreciation, $138,000 of stock-based compensation, $177,000 of lease amortization, and $36,000 of impairment of property and equipment, were offset by the change in fair value of common stock warrant and option liabilities of $593,000, adjustments in our working capital accounts of $329,000, and operating lease payments of $269,000.
Current wording
Cash used in operating activities for the six months ended June 30, 2024, was $5.7 million. With respect to our net loss of $1.4 million, non-cash charges including $85,000 of depreciation, $240,000 of stock-based compensation, $352,000 of lease amortization, and $36,000 of impairment of property and equipment, were offset by the change in fair value of common stock warrant and option liabilities of $163,000, amortization of note receivable discount of $29,000, adjustments in our working capital accounts of $229,000, a gain on disposal of property and equipment of $89,000 and operating lease payments of $507,000.
Previous wording
Cash used in operating activities for the three months ended March 31, 2023, was $3.5 million. With respect to our net loss of $9.4 million, non-cash charges including $430,000 of issuance and offering costs, $6.1 million of valuation loss recognized for the March 2023 PIPE, $212,000 of stock-based compensation, $180,000 of lease amortization, $71,000 of depreciation, $23,000 of write-downs of inventory, and adjustments in our working capital accounts of $76,000, were offset by the change in fair value of common stock warrant and option liabilities of $940,000, operating lease payments of $191,000 and a gain on disposal of property and equipment of $19,000.
Current wording
Cash used in operating activities for the six months ended June 30, 2023, was $8.3 million. With respect to our net loss of $8.6 million, non-cash charges, including $430,000 of issuance and offering costs, $6.1 million of valuation loss recognized for the March 2023 PIPE, $411,000 of stock-based compensation, $357,000 of lease amortization, $138,000 of depreciation and $192,000 of write-downs of inventory, were offset by the change in fair value of common stock warrant and option liabilities of $5.4 million, adjustments in our working capital accounts of $1.5 million, a gain on disposal of property and equipment of $26,000, and operating lease payments of $382,000.
Previous wording
Cash provided by investing activities for the three months ended March 31, 2024 consisted of proceeds of $17,000 from the sale of property and equipment offset by $13,000 of purchases of property and equipment.
Current wording
Cash provided by investing activities for the six months ended June 30, 2023 consisted of proceeds of $37,000 from the sale of property and equipment as well as proceeds of $569,000 from the sale of Verdeca, offset by $5,000 of purchases of property and equipment and $5.0 million of purchases of investments.
Previous wording
Cash provided by financing activities for the three months ended March 31, 2024 consisted of proceeds from the purchase of ESPP shares of $5,000.
Current wording
Cash provided by financing activities for the six months ended June 30, 2024 consisted of proceeds from the purchase of ESPP shares of $5,000.
Previous wording
Cash provided by financing activities for the three months ended March 31, 2023 consisted of gross proceeds of $6.0 million from the March 2023 PIPE financing transaction and proceeds from the purchase of ESPP shares of $5,000, which were offset by payments of transaction costs related to the March 2023 PIPE financing transaction of $497,000.
Current wording
Cash provided by financing activities for the six months ended June 30, 2023 consisted of gross proceeds of $6.0 million from the March 2023 PIPE financing transaction and proceeds from the purchase of ESPP shares of $5,000, which were offset by payments of transaction costs related to the March 2023 PIPE financing transaction of $497,000.
Rearranged current paragraphs (4)
Current report — wording carried from elsewhere
Research and development expenses decreased by $24,000, or 60%, during the six months ended June 30, 2024 compared to the same period in 2023 primarily related to lower consulting fees.
Current report — wording carried from elsewhere
During the six months ended June 30, 2023, the Company recognized a $6.1 million valuation loss related to the March 2023 PIPE financing transaction. The valuation loss includes the fair value in excess of gross proceeds and the increase in fair value related to the re-pricing of existing warrants.
Current report — wording carried from elsewhere
The change in the estimated fair value of common stock warrant and option liabilities resulted in a gain of $163,000 and $5.4 million during the six months ended June 30, 2024 and 2023, respectively, related to the change in the estimated fair value of the liability classified preferred investment options issued in connection with the March 2023 PIPE and August 2022 Registered Direct Offering financing transactions.
Current report — wording carried from elsewhere
Issuance and offering costs allocated to liability classified options
Rearranged previous paragraphs (5)
Previous report — wording carried elsewhere
On July 8, 2022, the Company entered into an agreement to license Saavy Naturals to Radiance Beauty and Wellness, Inc. ("Radiance Beauty").
Previous report — wording carried elsewhere
In July 2023, management made the decision to exit the remaining body care brands, Soul Spring and ProVault, as a result of continued pressure on the CBD market due to regulatory uncertainty. Body care operations ceased during the third quarter of 2023.
Previous report — wording carried elsewhere
Change in the estimated fair value of common stock warrant and option liabilities
Previous report — wording carried elsewhere
Change in the estimated fair value of common stock warrant and option liabilities
Previous report — wording carried elsewhere
Cash provided by investing activities for the three months ended March 31, 2023 consisted of proceeds of $30,000 from sale of property and equipment as well as proceeds of $285,000 from sale of Verdeca.