EMERSON RADIO CORP

Previous wording

The following table summarizes certain financial information for the three and six month periods ended September 30, 2024 (fiscal 2025) and September 30, 2023 (fiscal 2024) (in thousands):

Current wording

The following table summarizes certain financial information for the three and nine month periods ended December 31, 2024 (fiscal 2025) and December 31, 2023 (fiscal 2024) (in thousands):

Previous wording

Net product sales — Net product sales for the three month period ended September 30, 2024 were approximately $2.7 million as compared to approximately $2.4 million for the three month period ended September 30, 2023, an increase of approximately $0.3 million, or 10.6%. The Company’s sales during the three month period ended September 30, 2024 were highly concentrated among its three largest customers –Walmart, Amazon, and Fred Meyer – comprising in the aggregate approximately 88% of the Company’s total net product sales. The Company’s sales during the three month period ended September 30, 2023, were highly concentrated among its three largest customers – Walmart, Amazon and Fred Meyer – comprising in the aggregate approximately 91% of the Company’s total net product sales.

Current wording

Net product sales — Net product sales for the three month period ended December 31, 2024 were approximately $3.9 million as compared to approximately $2.6 million for the three month period ended December 31, 2023, an increase of approximately $1.3 million, or 49.8%. The Company’s sales during the three month period ended December 31, 2024 were highly concentrated among its three largest customers – Amazon, Walmart and Big Lots – comprising in the aggregate approximately 95% of the Company’s total net product sales during the period. The Company’s sales during the three month period ended December 31, 2023, were highly concentrated among its two largest customers – Walmart and Amazon – comprising in the aggregate approximately 85% of the Company’s total net product sales.

Previous wording

Net product sales for thesix month period ended September 30, 2024 were approximately $4.8 million as compared to approximately $4.1 million for thesix month period ended September 30, 2023, an increase of approximately $0.7 million, or 15.8%. The Company’s sales during thesix month period ended September 30, 2024 were highly concentrated among its three largest customers – Walmart, Amazon and Fred Meyer – comprising in the aggregate approximately 86% of the Company’s total net product sales. The Company’s sales during thesix month period ended September 30, 2023, were highly concentrated among its three largest customers – Walmart, Amazon and Fred Meyer – comprising in the aggregate approximately 91% of the Company’s total net product sales.

Current wording

Net product sales for the nine month period ended December 31, 2024 were approximately $8.7 million as compared to approximately $6.7 million for the nine month period ended December 31, 2023, an increase of approximately $2.0 million, or 28.9%. The Company’s sales during the nine month period ended December 31, 2024 were highly concentrated among its three largest customers – Amazon, Walmart and Big Lots – comprising in the aggregate approximately 84% of the Company’s total net product sales. The Company’s sales during the nine month period ended December 31, 2023, were highly concentrated among its three largest customers – Walmart, Amazon and Fred Meyer – comprising in the aggregate approximately 91% of the Company’s total net product sales.

Previous wording

Net product sales are comprised primarily of the sales of houseware and audio products which bear the Emerson® brand name. Net product sales may be periodically impacted by adjustments made to the Company’s sales allowance and marketing support accrual to record unanticipated customer deductions from accounts receivable or to reduce the accrual by any amounts which were accrued in the past but not taken by customers through deductions from accounts receivable within a certain time period. In the aggregate, these adjustments had the effect of increasing net product sales and operating income by approxim ately$11,000 and $3,000 forthe three month periods ended September 30, 2024 and September 30, 2023, respectively, and by approximately $21,000 and $6,000 for the six month periods ended September 30, 2024 and September 30, 2023, respectively. The major elements which contributed to the overall increase in net product sales were as follows:

Current wording

Net product sales are comprised primarily of the sales of houseware and audio products which bear the Emerson® brand name. Net product sales may be periodically impacted by adjustments made to the Company’s sales allowance and marketing support accrual to record unanticipated customer deductions from accounts receivable or to reduce the accrual by any amounts which were accrued in the past but not taken by customers through deductions from accounts receivable within a certain time period. In the aggregate, these adjustments had the effect of increasing net product sales and operating income by approxim ately$11,000 and $3,000 forthe three month periods ended December 31, 2024 and December 31, 2023, respectively, and by approximately $32,000 and $9,000 for the nine month periods ended December 31, 2024 and December 31, 2023, respectively. The major elements which contributed to the overall increase in net product sales were as follows:

Previous wording

i)Houseware products: Net sales of houseware products increased approximately $0.5 million, or 67.5%, to approximately $1.2 million for the three month period ended September 30, 2024 as compared to approximately $0.7 million for the three month period ended September 30, 2023, driven by increased net sales of newly introduced microwave ovens and refrigerators to the market. Net sales of houseware products increased approximately $0.9 million, or 65.0%, to approximately $2.3 million for thesix month period ended September 30, 2024 as compared to approximately $1.4 million for thesix month period ended September 30, 2023, driven by increased net sales of newly introduced microwave ovens and refrigerators to the market.

Current wording

i)Houseware products: Net sales of houseware products increased approximately $1.5 million, or 239.8%, to approximately $2.1 million for the three month period ended December 31, 2024 as compared to approximately $0.6 million for the three month period ended December 31, 2023, driven by increased net sales of newly introduced microwave ovens to the market. Net sales of houseware products increased approximately $2.4 million, or 118.9%, to approximately $4.4 million for the nine month period ended December 31, 2024 as compared to approximately $2.0 million for the nine month period ended December 31, 2023, driven by increased net sales of newly introduced microwave ovens and refrigerators to the market.

Previous wording

ii)Audio products: Net sales of audio products decreased approximately $0.2 million, or 13.4%, to approximately $1.5 million for the three month period ended September 30, 2024 as compared to approximately $1.7 million for the three month period ended September 30, 2023. Net sales of audio products decreased approximately $0.2 million, or 9.5%, to $2.5 million for thesix month period ended September 30, 2024 as compared to approximately $2.7 million for thesix month period ended September 30, 2023.

Current wording

ii)Audio products: Net sales of audio products decreased approximately $0.2 million, or 9.9%, to approximately $1.8 million for the three month period ended December 31, 2024 as compared to approximately $2.0 million for the three month period ended December 31, 2023. Net sales of audio products decreased approximately $0.5 million, or 9.7%, to $4.2 million for the nine month period ended December 31, 2024 as compared to approximately $4.7 million for the nine month period ended December 31, 2023.

Previous wording

Emerson’s success is dependent on its ability to anticipate and respond to changing consumer demands and trends in a timely manner, as well as expanding into new markets and sourcing new products that are profitable to the Company. Geo-political factors may also affect the Company’s operations and demand for the Company’s products, which are subject to customs requirements and to tariffs and quotas set by governments through mutual agreements and bilateral actions. The Company expects that U.S. tariffs on categories of products that the Company imports from China, and China’s retaliatory tariffs on certain goods imported from the United States, as well as modifications to international trade policy, will continue to affect its product costs going forward. If no mitigation steps are taken, or the mitigation is unsuccessful, the combination of tariffs will result in significantly increased annualized costs to the Company as all of the Company’s products are currently manufactured by suppliers in China. Although the Company is monitoring the trade and political environment and working to mitigate the possible effect of tariffs with its suppliers as well as its customers through pricing and sourcing strategies, the Company cannot be certain how its customers and competitors will react to the actions taken. In addition, heightened tensions between the United States and China over Hong Kong and any resulting retaliatory policies may affect our operations in Hong Kong. At this time the Company is unable to quantify possible effects on its costs arising from the new tariffs, which are expected to increase the Company’s inventory costs and associated costs of sales as tariffs are incurred, and some costs may be passed through to the Company’s customers as product price increases in the future. However, if the Company is unable to successfully pass through the additional costs or otherwise mitigate the effects of these tariffs, or if the higher prices reduce demand for the Company’s products, it will have a negative effect on the Company’s product sales and gross margins.

Current wording

Emerson’s success is dependent on its ability to anticipate and respond to changing consumer demands and trends in a timely manner, as well as expanding into new markets and sourcing new products that are profitable to the Company. Geo-political factors may also affect the Company’s operations and demand for the Company’s products, which are subject to customs requirements and to tariffs and quotas set by governments through mutual agreements and bilateral actions. The Company expects that U.S. tariffs on categories of products that the Company imports from China, and China’s retaliatory tariffs on certain goods imported from the United States, as well as modifications to international trade policy, will continue to affect its product costs going forward. Although the Company is monitoring the trade and political environment and working to mitigate the possible effect of tariffs with its suppliers as well as its customers through pricing and sourcing strategies, the Company cannot be certain how its customers and competitors will react to the actions taken. If the Company's mitigation efforts are unsuccessful, the combination of tariffs will result in significantly increased annualized costs to the Company as all of the Company’s products are currently manufactured by suppliers in China. In addition, heightened tensions between the United States and China over Hong Kong and any resulting retaliatory policies may affect our operations in Hong Kong. At this time the Company is unable to quantify possible effects on its costs arising from the new tariffs, which are expected to increase the Company’s inventory costs and associated costs of sales as tariffs are incurred, and some costs may be passed through to the Company’s customers as product price increases in the future. However, if the Company is unable to successfully pass through the additional costs or otherwise mitigate the effects of these tariffs, or if the higher prices reduce demand for the Company’s products, it will have a negative effect on the Company’s product sales and gross margins.

Previous wording

Licensing revenue — Licensing revenue for the three month period ended September 30, 2024 was approximately $68,000 as compared to approximately $24,000 for the three month period ended September 30, 2023, an increase of approximately $44,000, or 183.3%. The increase for the three month period ended September 30, 2024, was the result of an annual escalation of guaranteed minimum royalties from an ongoing licensee and the revenue earned from a new licensee. Licensing revenue for thesix month period ended September 30, 2024 was approximately $137,000 as compared to approximately $101,000 for thesix month period ended September 30, 2023, an increase of approximately $36,000, or 35.6%. The year-over-year increase was the result of an annual escalation of guaranteed minimum royalties from an ongoing licensee and the revenue earned from a new licensee partially offset by lost revenue from a terminated licensee in June 2023.

Current wording

Licensing revenue — Licensing revenue for the three month period ended December 31, 2024 was approximately $111,000 as compared to approximately $23,000 for the three month period ended December 31, 2023, an increase of approximately $88,000, or 382.6%. The increase for the three month period ended December 31, 2024, was the result of one of the Company's licensees exceeding their annual guaranteed minimum royalties and the revenue earned from a new licensee. Licensing revenue for the nine month period ended December 31, 2024 was approximately $248,000 as compared to approximately $124,000 for the nine month period ended December 31, 2023, an increase of approximately $124,000, or 100%. The year-over-year increase was the result of one of its licensees exceeding their annual guaranteed minimum royalties and the revenue earned from a new licensee, partially offset by lost revenue from a terminated licensee in June 2023.

Previous wording

Net revenues — Net revenues were approximately $2.7 million for the three month period ended September 30, 2024 as compared to approximately $2.4 million for the three month period ended September 30, 2023, an increase of approximately $0.3 million, or 12.3%. The increase in net revenues can be attributed primarily to the introduction of new models of the Company's houseware products to the marketplace as well as increased demand from the Company's key customers.

Current wording

Net revenues — Net revenues were approximately $4.0 million for the three month period ended December 31, 2024 as compared to approximately $2.6 million for the three month period ended December 31, 2023, an increase of approximately $1.4 million, or 52.7%. The increase in net revenues can be attributed primarily to the introduction of new models of the Company's houseware products to the marketplace as well as increased demand from the Company's key customers.

Previous wording

Net revenues were approximately $4.9 million for thesix month period ended September 30, 2024 as compared to approximately $4.2 million for thesix month period ended September 30, 2023, an increase of approximately $0.7 million, or 16.2%. The increase in net revenues can be attributed primarily to the introduction of new models of the Company's houseware products to the marketplace as well as increased demand from the Company's key customers.

Current wording

Net revenues were approximately $8.9 million for the nine month period ended December 31, 2024 as compared to approximately $6.9 million for the nine month period ended December 31, 2023, an increase of approximately $2.0 million, or 30.1%. The increase in net revenues can be attributed primarily to the introduction of new models of the Company's houseware products to the marketplace as well as increased demand from the Company's key customers.

Previous wording

Cost of sales — Cost of sales increased approximately $0.4 million, or 20.9% to approximately $2.5 million for the three month period ended September 30, 2024 as compared to approximately $2.1 million for the three month period ended September 30, 2023. The increase in absolute terms for the three month period ended September 30, 2024 as compared to the three month period ended September 30, 2023 was primarily related to an increase in net product sales, increased carrying costs of inventory and the product mix of sales in the current quarter.

Current wording

Cost of sales — Cost of sales increased approximately $1.4 million, or 63.8% to approximately $3.5 million for the three month period ended December 31, 2024 as compared to approximately $2.1 million for the three month period ended December 31, 2023. The increase in absolute terms for the three month period ended December 31, 2024 as compared to the three month period ended December 31, 2023 was primarily related to an increase in net product sales, increased carrying costs of inventory and the product mix of sales in the current quarter.

Previous wording

Cost of sales increased approximately $1.0 million, or 27.4% to approximately $4.5 million for thesix month period ended September 30, 2024 as compared to approximately $3.5 million for thesix month period ended September 30, 2023. The increase in absolute terms for thesix month period ended September 30, 2024 as compared to thesix month period ended September 30, 2023 was primarily related to an increase in net product sales, increased carrying costs of inventory and the product mix of sales in the current six month period.

Current wording

Cost of sales increased approximately $2.3 million, or 41.2% to approximately $8.0 million for the nine month period ended December 31, 2024 as compared to approximately $5.7 million for the nine month period ended December 31, 2023. The increase in absolute terms for the nine month period ended December 31, 2024 as compared to thenine month period ended December 31, 2023 was primarily related to an increase in net product sales, increased carrying costs of inventory and the product mix of sales in the current nine month period.

Previous wording

Selling, general and administrative expenses (“S,G&A”) — S,G&A was approximately $1.4 million for the three month period ended September 30, 2024 as compared to approximately $1.1 million for the three month period ended September 30, 2023, an increase of approximately $0.3 million or 30.6%. S,G&A, as a percentage of net revenues, was approximately 50.7% for the three month period ended September 30, 2024 as compared to approximately 43.6% for the three month period ended September 30, 2023. The increase in S,G&A for the three month period ended September 30, 2024 as compared to the three month period ended September 30, 2023 was driven primarily by increased compensation costs of approximately $259,000, increased audit fees of approximately $29,000, and increased advertising expense of approximately $27,000, partially offset by a decrease in legal fees of approximately $57,000. Compensation costs for the three month period ended September 30, 2024 were approximately $822,000 as compared to approximately $563,000 for the three month period ended September 30, 2023. Audit fees for the three month period ended September 30, 2024 were approximately $54,000 as compared to approximately $25,000 for the three month period ended September 30, 2023. Advertising expense for the three month period ended September 30, 2024 were approximately $45,000 as compared to approximately $18,000 for the three month period ended September 30, 2023. Legal fees for the three month period ended September 30, 2024 were approximately $55,000 as compared to approximately $112,000 for the three month period ended September 30, 2023.

Current wording

Selling, general and administrative expenses (“S,G&A”) — S,G&A was approximately $1.2 million for both three month periods ended December 31, 2024 and December 31, 2023. S,G&A, as a percentage of net revenues, was approximately 30.6% for the three month period ended December 31, 2024 as compared to approximately 45.8% for the three month period ended December 31, 2023. The changes in S,G&A for the three month period ended December 31, 2024 as compared to the three month period ended December 31, 2023 was driven primarily by increased compensation costs of approximately $178,000, increased commission expense of approximately $49,000 and increases in trade expenses of approximately $35,000, partially offset by a decrease in legal fees of approximately $274,000. Compensation costs for the three month period ended December 31, 2024 were approximately $737,000 as compared to approximately $558,000 for the three month period ended December 31, 2023. Commission expense fees for the three month period ended December 31, 2024 were approximately $72,000 as compared to approximately $23,000 for the three month period ended December 31, 2023. Trade expenses for the three month period ended December 31, 2024 were approximately $73,000 as compared to approximately $38,000 for the three month period ended December 31, 2023. Legal fees for the three month period ended December 31, 2024 generated a benefit of approximately $37,000 as compared to expense of approximately $236,000 for the three month period ended December 31, 2023.

Previous wording

S,G&A was approximately $2.8 million for thesix month period ended September 30, 2024 as compared to approximately $2.3 million for thesix month period ended September 30, 2023, an increase of approximately $0.5 million or 24.0%. S,G&A, as a percentage of net revenues, was approximately 56.8% for thesix month period ended September 30, 2024 as compared to approximately 53.3% for thesix month period ended September 30, 2023. The increase in S,G&A for the six month period ended September 30, 2024 as compared to the six month period ended September 30, 2023 was driven primarily by increased compensation costs of approximately $395,000, increased audit fees of approximately $70,000, and increased advertising expense of approximately $26,000. Compensation costs for thesix month period ended September 30, 2024 were approximately $1,517,000 as compared to approximately $1,122,000 for thesix month period ended September 30, 2023. Audit fees for thesix month period ended September 30, 2024 were approximately $120,000 as compared to approximately $50,000 for thesix month period ended September 30, 2023. Advertising expense for thesix month period ended September 30, 2024 were approximately $73,000 as compared to approximately $47,000 for thesix month period ended September 30, 2023.

Current wording

S,G&A was approximately $4.0 million for the nine month period ended December 31, 2024 as compared to approximately $3.5 million for the nine month period ended December 31, 2023, an increase of approximately $0.5 million or 16.3%. S,G&A, as a percentage of net revenues, was approximately 45.1% for the nine month period ended December 31, 2024 as compared to approximately 50.4% for the nine month period ended December 31, 2023. The increase in S,G&A for the nine month period ended December 31, 2024 as compared to the nine month period ended December 31, 2023 was driven primarily by increased compensation costs of approximately $573,000, increased trade expenses of $90,000, increased audit fees of approximately $73,000 and increased depreciation expense of approximately $41,000 partially offset by a decrease in legal fees of approximately $260,000. Compensation costs for the nine month period ended December 31, 2024 were approximately $2,253,000 as compared to approximately $1,680,000 for the nine month period ended December 31, 2023. Trade expenses for the nine month period ended December 31, 2024 were approximately $210,000 as compared to approximately $120,000 for the nine month period ended December 31, 2023. Audit fees for the nine month period ended December 31, 2024 were approximately $176,000 as compared to approximately $103,000 for the nine month period ended December 31, 2023. Depreciation expense for the nine month period ended December 31, 2024 were approximately $57,000 as compared to approximately $16,000 for the nine month period ended December 31, 2023. Legal fees for the nine month period ended December 31, 2024 were approximately $201,000 as compared to approximately $461,000 for the nine month period ended December 31, 2023.

Previous wording

Interest income, net — Interest income, net, was approximately $236,000 for the three month period ended September 30, 2024 as compared to approximately $289,000 for the three month period ended September 30, 2023, a decrease of approximately $53,000. The decrease was primarily due to lower levels of cash invested on the Company’s short term investments.

Current wording

Interest income, net — Interest income, net, was approximately $206,000 for the three month period ended December 31, 2024 as compared to approximately $289,000 for the three month period ended December 31, 2023, a decrease of approximately $83,000. The decrease was primarily due to lower levels of cash invested on the Company’s short term investments.

Previous wording

Interest income, net, was approximately $499,000 for thesix month period ended September 30, 2024 as compared to approximately $583,000 for thesix month period ended September 30, 2023, a decrease of approximately $84,000. The decrease was primarily due to lower levels of cash invested on the Company’s short term investments.

Current wording

Interest income, net, was approximately $705,000 for thenine month period ended December 31, 2024 as compared to approximately $872,000 for thenine month period ended December 31, 2023, a decrease of approximately $167,000. The decrease was primarily due to lower levels of cash invested on the Company’s short term investments.

Previous wording

Provision for income taxes — For the three month period ended September 30, 2024, the Company recorded income tax expense of nil as compared to approximately $88,000 for the three month period ended September 30, 2023. For the six month period ended September 30, 2024, the Company recorded income tax expense of approximately $3,000 as compared to $88,000 for the six month period ended September 30, 2023.The Company under the adoption of ASU 2019-12 “Income Taxes (Topic 740) – Simplifying the Accounting for Income Taxes” incurred non-income based state taxes of approximately $9,000 for both of the six month periods ended September 30, 2024 and September 30, 2023, which are now reported as S,G&A. See “Note 5 – Income Taxes”.

Current wording

(Benefit) provision for income taxes — For the three month period ended December 31, 2024, the Company recorded income tax expense of nil as compared to an income tax benefit of approximately $14,000 for the three month period ended December 31, 2023. For the nine month period ended December 31, 2024, the Company recorded income tax expense of approximately $3,000 as compared to $74,000 for the nine month period ended December 31, 2023.The Company under the adoption of ASU 2019-12 “Income Taxes (Topic 740) – Simplifying the Accounting for Income Taxes” incurred non-income based state taxes of approximately $9,000 for both of the nine month periods ended December 31, 2024 and December 31, 2023, which are now reported as S,G&A. See “Note 5 – Income Taxes”.

Previous wording

Although the Company generated a net loss during the three and six months ended September 30, 2024, it is unable to realize an income tax benefit until the Company can demonstrate the ability to generate net income on a sustained basis. Therefore, the Company is obligated to record a 100% valuation allowance against the deferred tax assets.

Current wording

Although the Company generated a net loss during the three and nine months ended December 31, 2024, it is unable to realize an income tax benefit until the Company can demonstrate the ability to generate net income on a sustained basis. Therefore, the Company is obligated to record a 100% valuation allowance against the deferred tax assets.

Previous wording

***Net loss (income) ***— As a result of the foregoing factors, the Company realized a net loss of approximately $881,000 for the three month period ended September 30, 2024 as compared to net income of approximately $2,365,000 for the three month period ended September 30, 2023.

Current wording

***Net loss (income) ***— As a result of the foregoing factors, the Company realized a net loss of approximately $527,000 for the three month period ended December 31, 2024 as compared to a net loss of approximately $421,000 for the three month period ended December 31, 2023.

Previous wording

As a result of the foregoing factors, the Company realized a net loss of approximately $1,843,000 for thesix month period ended September 30, 2024 as compared to net income of approximately $2,070,000 for thesix month period ended September 30, 2023.

Current wording

As a result of the foregoing factors, the Company realized a net loss of approximately $2,370,000 for the nine month period ended December 31, 2024 as compared to net income of approximately $1,649,000 for the nine month period ended December 31, 2023.

Previous wording

As of September 30, 2024, the Company had cash and cash equivalents of approximately $0.5 million as compared to approximately $19.9 million at March 31, 2024. Cash and cash equivalents includes short term investments in deposits which were classified as cash equivalents of nil as of September 30, 2024 compared to approximately $19.1 million of such deposits as of March 31, 2024. Working capital decreased to approximately $23.9 million at September 30, 2024 as compared to approximately $26.6 million at March 31, 2024. The decrease in cash and cash equivalents of approximately $19.4 million was due to an increase in short term deposits of approximately $16.3 million, the net loss generated during the period of approximately $1.8 million, an increase in accounts receivable of approximately $0.8 million, a decrease in long-term taxes payable of approximately $0.7 million, a decrease in accounts payable and other current liabilities of approximately $0.3 million, an increase in right of use assets of approximately $0.2 million, an increase in prepaid purchases of approximately $0.2 million and an increase in prepaid expenses and other current liabilities of approximately $0.1 million, partially offset by a decrease in inventory of approximately $0.8 million and an increase in long term operating lease liabilities of approximately $0.2 million.

Current wording

As of December 31, 2024, the Company had cash and cash equivalents of approximately $0.7 million as compared to approximately $19.9 million at March 31, 2024. Cash and cash equivalents includes short term investments in deposits which were classified as cash equivalents of $0.1 million as of December 31, 2024 compared to approximately $19.1 million of such deposits as of March 31, 2024. Working capital decreased to approximately $23.4 million at December 31, 2024 as compared to approximately $26.6 million at March 31, 2024. The decrease in cash and cash equivalents of approximately $19.2 million was due to an increase in short term deposits of approximately $15.7 million, the net loss generated during the period of approximately $2.4 million, an increase in accounts receivable of approximately $2.2 million, a decrease in long-term taxes payable of approximately $0.7 million, a decrease in right of use assets of approximately $0.2 million and an increase in property and equipment of approximately $0.1 million, partially offset by a decrease in inventory of approxima tely $1.8 million, an increase in long term operating lease liabilities of approximately $0.2 million and an increase in short-term taxes payable of approximately $0.1 million.

Previous wording

Net cash used by operating activities was approximately $2.9 million for thesix month period ended September 30, 2024, resulting from the loss generated during the period of approximately $1.8 million, an increase in accounts receivable of approximately $0.8 million, a decrease in income taxes payable of approximately $0.5 million, a decrease in accounts payable and other current liabilities of $0.3 million, an increase in right of use assets of approximately $0.3 million and an increase in prepaid purchases of approximately $0.2 million, partially offset by a decrease in inventory of approximately $0.8 million and an increase in long term lease liabilities of approximately $0.2 million.

Current wording

Net cash used by operating activities was approxim ately $3.3 million for the nine month period ended December 31, 2024, resulting from the loss generated during the period of approximately $2.4 million, an increase in accounts receivable of approximately $2.2 million, a decrease in income taxes payable of approximately $0.5 million and an increase in right of use assets of approximately $0.3 million, partially offset by a decrease in inventory of approximately $1.8 million, an increase in long term lease liabilities of approximately $0.2 million and an increase in accounts payable and other current liabilities of approximately $0.1 million.

Previous wording

Net cash used by investing activities was approximately $16.5 million for thesix month period ended September 30, 2024 due to purchases of short-term investments of approximately $16.3 million and additions to property and equipment of approximately $0.2 million.

Current wording

Net cash used by investing activities was approximately $16.0 million for thenine month period ended December 31, 2024 due to net purchases of short-term investments of approximately $15.8 million and additions to property and equipment of approximately $0.2 million.

Previous wording

Net cash provided by financing activities was approximately $7,000 for thesix month period ended September 30, 2024 due to a new copier lease.

Current wording

Net cash provided by financing activities was approximately $6,000 for thenine month period ended December 31, 2024 due to a new copier lease.

Previous wording

The following ASU was issued by the FASB which relate to or could relate to the Company as concerns the Company’s normal ongoing operations or the industry in which the Company operates.

Current wording

The following ASUs were issued by the FASB which relate to or could relate to the Company as concerns the Company’s normal ongoing operations or the industry in which the Company operates.