Filing summary
Issuer discrepancy: The supplied filing is BioSig Technologies, Inc. (Nasdaq: BSGM), not Streamex Corp. It is a Form 10-Q for the quarter ended March 31, 2023, filed May 15, 2023. The financial statements are unaudited; amounts below are in thousands of dollars unless noted.
Business context and reporting period
BioSig is commercializing the PURE EP cardiac electrophysiology system, an FDA 510(k)-cleared medical device. The company reported minimal revenue and is in an early commercialization stage. Its majority-owned ViralClear subsidiary is developing nerve-recording technology; NeuroClear is dormant, with management intending to house neurotechnology assets there. BioSig said more than 3,000 procedures had been performed using PURE EP at 21 U.S. hospitals.
Financial results and liquidity
| Metric | Q1 2023 | Q1 2022 / comparison |
|---|---|---|
| Revenue | $5 | $8; down $3 |
| Gross profit / margin | $5 / 100% | $8 / 100%; no cost of sales in either period |
| Research and development | $1,062 | $1,617; down 34.3% |
| General and administrative | $6,245 | $6,401; down 2.4% |
| Operating loss | $(7,386) | $(8,065) |
| Net loss attributable to common shareholders | $(7,334), or $(0.12) per share | $(7,965), or $(0.22) per share |
| Operating cash flow | $(5,648) | $(5,941) |
| Cash from financing | $6,748 | $3,002 |
At March 31, 2023, cash was $1,412, compared with $357 at December 31, 2022. Working capital was negative $664. Total assets were $5,197, total liabilities $3,182, and total equity $1,910. Lease liabilities totaled $689 ($321 current and $368 long term); the company reported no convertible debentures outstanding. Cash used in investing activities was $45. The filing reports an accumulated deficit of $223.3 million.
Changes, financing and outlook
- Q1 operating expenses declined about 8.4% overall. Management attributed lower R&D mainly to reduced salaries, consulting, travel and supplies; lower G&A reflected reduced ViralClear activity and lower payroll, partly offset by higher stock-based compensation and professional fees.
- Q1 private placements generated $6.748 million net of transaction costs: 8.5 million common shares and warrants for up to 4.25 million shares. Common shares outstanding rose from 54.6 million at year-end to 66.9 million at March 31. The filing also discloses substantial equity compensation and warrant overhang.
- After quarter-end, an April placement raised approximately $945,000. Management’s MD&A describes placements from January through April totaling approximately $7.67 million gross, involving 9.29 million shares and warrants for up to 4.65 million shares.
- No quantitative revenue or earnings guidance was provided. Management expects continued losses and negative operating cash flow, and says further financing is required. Its plans include commercializing PURE EP, pursuing other technology applications, and raising capital through equity, debt or strategic partnerships; management said the shift toward commercialization has reduced operating costs.
Risks, contingencies and unusual items
- Going concern: Management and the filing state that recurring losses, negative operating cash flow, a $664,000 working-capital deficit and reliance on additional financing raise substantial doubt about the company’s ability to continue as a going concern.
- Revenue concentration: One customer accounted for 100% of revenue in both comparative quarters. Three customers represented 100% of quarter-end receivables.
- Potential dilution and preferred-stock terms: Series C preferred stock has a $105,000 stated value and provisions that can require redemption upon specified triggering events. The company may be unable to meet a redemption demand; unpaid required redemption amounts can accrue interest.
- Commitments and operations: Purchase commitments were approximately $2.547 million, some subject to modification or cancellation. The company relies on one contract manufacturer and disclosed supply-chain risks. It also cited possible commercialization delays related to COVID-19 and market volatility that could limit access to capital.
- Controls: Management concluded disclosure controls were not effective. It identified a material weakness in internal control over financial reporting involving identification, recording and reporting of stock compensation under certain third-party contracts. Remediation steps were underway but were not yet deemed complete.
- Other items: No material legal proceeding was identified. The company reported no off-balance-sheet arrangements. Cash deposits exceeding FDIC limits were $1.1 million at quarter-end.
Most important facts for investors to verify
- Confirm the intended issuer: this filing is for BioSig Technologies, not Streamex Corp.
- Assess financing needs and cash runway against the reported $1.412 million cash balance and $5.648 million quarterly operating cash use; subsequent financing does not eliminate the stated going-concern uncertainty.
- Track PURE EP commercial adoption, recurring revenue, customer concentration and the company’s ability to convert evaluations and placements into meaningful sales.
- Review share-count growth, outstanding warrants and equity awards for potential dilution, including subsequent-period issuances.
- Monitor remediation and testing of the disclosed control weakness, and review the Series C preferred-stock redemption provisions and purchase commitments.