OMNIQ Corp
For the period ended Jun 30, 2024. Filed Aug 14, 2024.
View on SEC.govAbout this filing
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 14, 2024
OMQS$0.130.0%Stored close · as of Jun 29, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-15.
0001493152-24-019872
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-14.
0001493152-24-032247
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 37 previous paragraphs and 61 current paragraphs.
21 unchanged; 16 reworded; 21 added; 0 removed; 0 previous and 3 current paragraphs rearranged.
Tables are not compared: 2 previous and 3 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 (21)
Current report
DISCLOSURE OF THE CHANGES IN TRADING VENUE
Current report
On May 3, 2024, The Nasdaq Stock Market LLC (“Nasdaq”) notified OMNIQ Corp. (the “Company”) that the Nasdaq Hearings Panel (the “Panel”) has determined to delist the Company’s common stock and that trading of the Company’s securities will be suspended at the open of trading on May 7, 2024. As previously reported, on August 9, 2023, Nasdaq Listing Qualifications Staff (the “Staff”) notified the Company that it no longer complied with the minimum $35 million market value of listed securities (“MVLS”) required for continued listing as set forth in Listing Rule 5550(b)(2). In accordance with Listing Rule 5810(c)(3)(A), the Company was provided 180 calendar days, or until February 5, 2024, to regain compliance. On February 8, 2024, Staff notified the Company that it had determined to delist the Company as it did not comply with the MVLS requirement for listing on the Exchange. On February 15, 2024, the Company requested a hearing, which was held on April 11, 2024.
Current report
On May 7, 2024, OMNIQ Corp. stock transitioned from NASDAQ to the OTC Markets, and OMNIQ’s stock continues to trade on the OTCQB under the ticker symbol “OMQS”, ensuring uninterrupted market activity for its shareholders.
Current report
Revenues
Current report
Cost of Goods Sold
Current report
Operating expenses
Current report
Total operating expenses for the six months ended June 30, 2024 and 2023 recognized was $12.1 million and $14.1 million, respectively, representing a 14% decrease. The decreases are related to the cost reduction plan put in place by management.
Current report
Selling, general and Administrative – Selling, general and administrative expenses for the six months ended June 30, 2024 and 2023 totaled $10.6 million and $12.1 million, respectively, representing a 12% decrease. The decreases are related to the cost reduction plan put in place by management.
Current report
Depreciation– Depreciation expenses for the six months ended June 30, 2024, and 2023 totaled $208 thousand and $204 thousand, respectively.
Current report
Intangible amortization – Intangible amortization expenses for the six months ended June 30, 2024, and 2023 totaled $458 thousand and $858 thousand, respectively.
Current report
Other income and expenses
Current report
Interest Expense – Interest expense for the six months ended June 30, 2024 totaled $1.7 million, as compared to $1.7 million for the six months ended June 30, 2023.
Current report
Cybersecurity
Current report
Risk Management and Strategy
Current report
We recognize the critical importance of developing, implementing, and maintaining robust cybersecurity measures to safeguard our information systems and protect the confidentiality, integrity, and availability of our data.
Current report
Managing Material Risks & Integrated Overall Risk Management
Current report
We have strategically integrated cybersecurity risk management into our broader risk management framework to promote a company-wide culture of cybersecurity risk management. This integration ensures that cybersecurity considerations are an integral part of our decision-making processes at every level. Our management team continuously evaluates and addresses cybersecurity risks in alignment with our business objectives and operational needs.
Current report
Oversee Third-party Risk
Current report
Because we are aware of the risks associated with third-party service providers, we have implemented stringent processes to oversee and manage these risks. We conduct thorough security assessments of all third-party providers before engagement and maintain ongoing monitoring to ensure compliance with our cybersecurity standards. The monitoring includes annual assessments of the SOC reports of our providers and implementing complementary controls. This approach is designed to mitigate risks related to data breaches or other security incidents originating from third-parties.
Current report
Risks from Cybersecurity Threats
Current report
We have not encountered cybersecurity challenges that have materially impaired our operations or financial standing.
Reworded paragraphs (16)
Previous wording
The Company’s sales from operations for the three months ended March 31, 2024, were $18.3 million, a decrease of approximately $9.5 million, or 34%, over the three months ended March 31, 2023.
Current wording
The Company’s sales from operations for the six months ended June 30, 2024, were $37 million, a decrease of approximately $11 million, or 22.8%, over the six months ended June 30, 2023.
Previous wording
The loss from operations for the three months ended March 31, 2024, was $1.3 million, a decrease of $752 thousand compared with the loss in the three months ended March 31, 2023, of $2 million. Basic loss per share from continuing operations for the three months ended March 31, 2024, was ($0.20) versus ($0.45) per share for the same period in 2023. Comprehensive loss for the three months ended March 31, 2024 and 2023 was $1.9 million and $3.1 million respectively, the only component to comprehensive loss besides net loss is foreign currency translation.
Current wording
The loss from operations for the six months ended June 30, 2024, was $2.2 million, a decrease of $2 million compared with the loss in the six months ended June 30, 2023, of $4.5 million. Basic loss per share from continuing operations for the six months ended June 30, 2024, was ($.48) versus ($.95) per share for the same period in 2023.
Previous wording
As of March 31, 2024, the Company had cash in the amount of $881 thousand and a working capital deficit of $46.4 million, compared to cash in the amount of $1.7 million, and a working capital deficit of $45.4 million as of December 31, 2023. The Company had stockholders’ deficit attributable to OmniQ stockholders of $36.5 million and $35 million as of March 31, 2024, and December 31, 2023, respectively. This increase in our stockholders’ deficit was primarily attributable to net losses.
Current wording
As of June 30, 2024, the Company had cash in the amount of $1.4 million and a working capital deficit of $48 million, compared to cash in the amount of $1.7 million, and a working capital deficit of $45 million as of December 31, 2023. The Company had stockholders’ deficit attributable to OmniQ stockholders of $38 million and $35 million as of June 30, 2024, and December 31, 2023, respectively. This increase in our stockholders’ deficit was primarily attributable to net losses.
Previous wording
The Company’s accumulated deficit was $115.9 million and $113.9 million as of March 31, 2024, and December 31, 2023.
Current wording
The Company’s accumulated deficit was $119 million and $114 million as of June 30, 2024, and December 31, 2023.
Previous wording
The Company’s operations used net cash of $623 thousand and $1.3 million in the three months ended March 31, 2024, and 2023, respectively. The decrease in cash used in operations of $666 thousand is due to the decrease in revenue.
Current wording
The Company’s operations used net cash of $3.7 million and 767 thousand in the six months ended June 30, 2024, and 2023, respectively. The decrease in cash used by operations of $2.9 million is due to an increase in accounts receivable.
Previous wording
The Company’s cash used in investing activities was $48 thousand for the three months ended March 31, 2024, compared to cash used in investing activities of $341 thousand for the three months ended March 31, 2023.
Current wording
The Company’s cash used in investing activities was $103 thousand for the six months ended June 30, 2024, compared to cash provided by investing activities of $572 thousand for the six months ended June 30, 2023.
Previous wording
The Company’s financing activities used $971 thousand of cash during the three months ended March 31, 2024, and provided $3 million during the three months ended March 31, 2023. During the three months ended March 31, 2024, the Company made payments of $1.1 million on its notes payable, and during the three months ended March 31, 2023, made payments of $544 thousand on its notes payable. Additionally, the Company borrowed $156 thousand on the Company’s line of credit during the three months ended March 31, 2024, compared to the three months ended March 31, 2023, when $3.4 million was borrowed on the Company’s line of credit.
Current wording
The Company’s financing activities provided $1.4 million of cash during the six months ended June 30, 2024, and $683 thousand during the six months ended June 30, 2023. During the six months ended June 30, 2024, the Company made payments of $1.8 million on its notes payable, compared to the payments of $673 thousand for the six months ended June 30, 2023. Additionally, the Company borrowed $3.2 million on the Company’s line of credit during the six months ended June 30, 2024, compared to the six months ended June 30, 2023, when $1.1 million was borrowed on the Company’s line of credit.
Previous wording
The following tables set forth certain selected unaudited condensed consolidated statements of operations data for the periods indicated in dollars. In addition, we note that the period-to-period comparison may not be indicative of future performance.
Current wording
The following tables set forth certain selected unaudited condensed consolidated statement of operations data for the periods indicated in dollars. In addition, we note that the period-to-period comparison may not be indicative of future performance.
Previous wording
For the three months ended March 31, 2024, and 2023, the Company generated net revenues in the amount of $18.3 million and $27.8 million, respectively. The decrease between the three-month periods was attributable to delays in projects and a slower demand.
Current wording
For the three months ended June 30, 2024 and 2023, the Company generated net revenues in the amount of $19 million and $20 million, respectively. The decrease between the three-month periods was attributable to the decrease in demand.
Previous wording
For the three months ended March 31, 2024, and 2023, the Company recognized a total of $13.3 million and $22 million, respectively, of cost of goods sold. For the three months ended March 31, 2024, and 2023, cost of goods sold were 72% and 79% of net revenues, respectively.
Current wording
For the three months ended June 30, 2024 and 2023, the Company recognized a total of $14.1 million and $16.4 million, respectively, of cost of goods sold. For the three months ended June 30, 2024 and 2023, cost of goods sold were 74% and 81% of net revenues, respectively.
Previous wording
Total operating expenses for the three months ended March 31, 2024, and 2023 recognized was $6.3 million and $7.7 million, respectively, representing a 18% decrease. The decrease in operating expenses was due primarily to management’s cost savings plan.
Current wording
Total operating expenses for the three months ended June 30, 2024 and 2023 recognized was $5.8 million and $6.4 million, respectively, representing an 9% decrease. The decreases are related to the cost reduction plan put in place by management.
Previous wording
Research and Development – Research and development expenses for the three months ended March 31, 2024, and 2023 totaled $405 thousand and $423 thousand, respectively.
Current wording
Research and Development – Research and development expenses for the three months ended June 30, 2024 and 2023 totaled $462 thousand and $559 thousand, respectively.
Previous wording
Selling, general and Administrative – Selling, general and administrative expenses for the three months ended March 31, 2024, and 2023 totaled $5.6 million and $6.8 million, respectively, representing a 18% decrease. The decrease was due primarily to management’s cost savings plan.
Current wording
Selling, general and Administrative – Selling, general and administrative expenses for the three months ended June 30, 2024 and 2023 totaled $5 million and $5.3 million, respectively, representing a 5% decrease. The decreases are related to the cost reduction plan put in place by management.
Previous wording
Depreciation– Depreciation expenses for the three months ended March 31, 2024, and 2023 totaled $116 thousand and $108 thousand, respectively, representing a 7% increase. The increase is directly related to the acquisition of additional fixed assets.
Current wording
Depreciation– Depreciation expenses for the three months ended June 30, 2024 and 2023 totaled $92 thousand and $96 thousand, respectively, representing a 4% decrease.
Previous wording
Intangible amortization – Intangible amortization expenses for the three months ended March 31, 2024, and 2023 totaled $231 thousand and $436 thousand, respectively. The decrease is due to diminishing life of intangibles.
Current wording
Intangible amortization – Intangible amortization expenses for the three months ended June 30, 2024 and 2023 totaled $227 thousand and $422 thousand, respectively.
Previous wording
Interest Expense – Interest expense for the three months ended March 31, 2024, totaled $917 thousand, as compared to $938 thousand for the three months ended March 31, 2023. The decrease is primarily attributable to the reduced line of credit.
Current wording
Interest Expense – Interest expense for the three months ended June 30, 2024 totaled $794 thousand, as compared to $740 thousand for the three months ended June 30, 2023.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
For the six months ended June 30, 2024 and 2023, the Company generated net revenues in the amount of $37 million and $48 million, respectively. The decrease between the six-month periods was attributable to the decrease in demand.
Current report — wording carried from elsewhere
For the six months ended June 30, 2024 and 2023, the Company recognized a total of $27.4 million and $38.3 million, respectively, of cost of goods sold. For the six months ended June 30, 2024 and 2023, cost of goods sold were 73% and 80% of net revenues, respectively.
Current report — wording carried from elsewhere
Research and Development – Research and development expenses for the six months ended June 30, 2024 and 2023 totaled $867 thousand and $982 thousand, respectively.