Dominari Holdings Inc

Previous wording

Dominari Holdings Inc. (“Dominari”) is a holding company that, through its various subsidiaries, is engaged in wealth management, investment banking, sales and trading and asset management. In addition to capital investment, Dominari provides management support to the executive teams of its subsidiaries, helping them to operate efficiently and reduce cost under a streamlined infrastructure. Dominari and its subsidiaries are collectively referred to herein as “Company,” “we,” “our” or “us.”

Current wording

Dominari Holdings Inc. (“Dominari”) is a holding company that, through its various subsidiaries, is engaged in wealth management, investment banking, sales and trading, asset management and insurance. In addition to capital investment, Dominari provides management support to the executive teams of its subsidiaries, helping them to operate efficiently and reduce cost under a streamlined infrastructure. Dominari and its subsidiaries are collectively referred to herein as “Company,” “we,” “our” or “us.”

Previous wording

During the three months ended March 31, 2024, we recognized approximately $1.4 million in revenue from operations, primarily driven by the commissions and underwriting revenue earned by Dominari Securities. During the three months ended March 31, 2024 and 2023, we incurred a loss from operations of approximately $2.8 million and $3.8 million, respectively. The decrease in loss from operations was primarily general and administrative expenses related to the process of winding down the assets held by Aikido Labs, LLC and was offset by a calendar year loss of $1.3 million from operations in the operations of Dominari Securities.

Current wording

During the three months ended June 30, 2024 and 2023, we recognized approximately $6.2 million and $71,000 in revenue from operations, respectively, primarily driven by the commissions and underwriting revenue earned by Dominari Securities and Dominari Manager LLC (“Manager”). During the three months ended June 30, 2024 and 2023, we incurred a loss from operations of approximately $2.7 million and $9.0 million, respectively.

Previous wording

During the three months ended March 31, 2024 and 2023, other (expenses) income was approximately $(2.6) million and $72,000, respectively. The activity for the three months ended March 31, 2024 and 2023, is primarily a result of overall volatility in investment valuations due to macroeconomic uncertainty (i.e. inflation, global tensions in the Ukraine and etc.) impacting marketable securities and the change in fair value of long-term equity investments. Specifically:

Current wording

The activity described above for the three months ended June 30, 2024 and 2023, is primarily a result of the Company’s entrance into the financial services industry, overall volatility in investment valuations due to macroeconomic uncertainty impacting marketable securities and the change in fair value of long-term equity investments. Specifically:

Previous wording

Our ultimate success is dependent on our ability to generate sufficient cash flow to meet our obligations on a timely basis. Our business may require significant amounts of capital to sustain operations that we need to execute our longer-term business plan to support our transition into the financial services industry. Our working capital amounted to approximately $23.8 million as of March 31, 2024. We believe our cash and cash equivalents and marketable securities, together with the anticipated cash flow from operations will be sufficient to meet our working capital and capital expenditure requirements for at least the next 12 months. In the event that cash flow from operations is not sufficient to fund our operations, as expected, or if our plans or assumptions change, including if inflation begins to have a greater impact on our business or if we decide to move forward with any activities that require more outlays of cash than originally planned, we may need to raise additional capital sooner than expected. We may raise this additional capital by obtaining additional debt or equity financing, especially if we experience downturns in our business that are more severe or longer than anticipated, or if we experience significant increases in expense levels resulting from being a publicly traded company or from continuing operations.

Current wording

Our ultimate success is dependent on our ability to generate sufficient cash flow to meet our obligations on a timely basis. Our business may require significant amounts of capital to sustain operations that we need to execute our longer-term business plan to support our transition into the financial services industry. Our working capital amounted to approximately $24.9 million as of June 30, 2024. We believe our cash and cash equivalents and marketable securities, together with the anticipated cash flow from operations will be sufficient to meet our working capital and capital expenditure requirements for at least the next 12 months. In the event that cash flow from operations is not sufficient to fund our operations, as expected, or if our plans or assumptions change, including if inflation begins to have a greater impact on our business or if we decide to move forward with any activities that require more outlays of cash than originally planned, we may need to raise additional capital sooner than expected. We may raise this additional capital by obtaining additional debt or equity financing, especially if we experience downturns in our business that are more severe or longer than anticipated, or if we experience significant increases in expense levels resulting from being a publicly traded company or from continuing operations.

Previous wording

For the three months ended March 31, 2024 and 2023, net cash used in operations was approximately $8.6 million and $4.0 million, respectively. The cash used in operating activities for the three months ended March 31, 2024, is primarily attributable to a net loss of approximately $5.4 million and changes in operating assets and liabilities of $6.5 million, partially offset by approximately $2.5 million of change in fair value of long-term equity investment. The cash used in operating activities for the three months ended March 31, 2023, is primarily attributable to a net loss of approximately $3.8 million and changes in operating assets and liabilities of $0.5 million, partially offset by approximately $0.1 million in unrealized losses on marketable securities and approximately $0.06 million of realized loss on marketable securities.

Current wording

For the six months ended June 30, 2024 and 2023, net cash used in operations was approximately $7.2 million and $13.9 million, respectively. The cash used in operating activities for the six months ended June 30, 2024, is primarily attributable to a net loss of approximately $11.6 million, $3.3 million realized gain on marketable securities and changes in operating assets and liabilities of $3.5 million, partially offset by approximately $5.5 million of change in fair value of long-term equity investment, $2.9 million unrealized loss on marketable securities and $1.7 million unrealized and realized loss on note receivable. The cash used in operating activities for the six months ended June 30, 2023, is primarily attributable to a net loss of approximately $12.4 million, approximately $0.5 million of realized gain on marketable securities and changes in operating assets and liabilities of $4.6 million, partially offset by $2.7 million stock-based compensation expense and approximately $0.5 million in unrealized losses on marketable securities.

Previous wording

For the three months ended March 31, 2024 and 2023, net cash provided by (used in) investing activities was approximately $7.7 million and $(18.7) million, respectively. The cash used in investing activities for the three months ended March 31, 2024, primarily resulted from our sales of marketable securities of approximately $8.8 million, partially offset by funds to employee forgivable loan of $1.3 million. The Company also collected approximately $0.3 million in principal related to its short-term notes. The cash used in investing activities for the three months ended March 31, 2023, primarily resulted from our purchase of marketable securities of approximately $17.5 million and the acquisition of FPS of approximately $1.1 million. The Company also collected approximately $0.3 million in principal related to its short-term notes.

Current wording

For the six months ended June 30, 2024 and 2023, net cash provided by (used in) investing activities was approximately $10.2 million and $(14.7) million, respectively. The cash provided by investing activities for the six months ended June 30, 2024, primarily resulted from our sales of marketable securities of approximately $11.6 million and the sale of a long-term investment of $3.5 million, partially offset by purchase of marketable securities of $4.0 million and funds to employee forgivable loan of $1.3 million. The cash used in investing activities for the six months ended June 30, 2023, primarily resulted from our purchase of marketable securities of approximately $34.0 million and the acquisition of FPS of approximately $1.1 million, partially offset by our sale of marketable securities approximately of $20.5 million. The Company also collected approximately $0.5 million in principal related to its short-term notes.

Previous wording

For the three months ended March 31, 2024, there is no cash flows from financing activities. For the three months ended March 31, 2023, cash used in financing activities was approximately $0.9 million, which reflects the cost for purchase of treasury stock of approximately $0.9 million.

Current wording

For the six months ended June 30, 2024, there is no cash flows from financing activities. For the six months ended June 30, 2023, cash used in financing activities was approximately $0.9 million, which reflects the cost for purchase of treasury stock of approximately $0.9 million.