Filing summary
Entity and period: The request identifies Streamex Corp., but the supplied Form 10-Q is for BioSig Technologies, Inc. (Nasdaq: BSGM), for the quarter ended June 30, 2022, filed August 15, 2022. The unaudited statements consolidate BioSig and its majority-owned subsidiary ViralClear. Financial amounts below are in thousands of dollars unless otherwise stated.
Business context and financial performance
BioSig is commercializing its PURE EP cardiac signal acquisition and processing system. It has generated minimal revenue to date; its other subsidiary, ViralClear, is no longer pursuing development of merimepodib and is focused on other applications of the core technology.
| Metric | Q2 2022 | Q2 2021 | Six months 2022 | Six months 2021 |
|---|---|---|---|---|
| Revenue | $8 | $207 | $16 | $325 |
| Gross profit | $8 | $145 | $16 | $164 |
| Operating expenses | $5,724 | $8,196 | $13,797 | $16,775 |
| Loss from operations | $(5,716) | $(8,051) | $(13,781) | $(16,611) |
| Net loss attributable to common shareholders | $(5,870) | $(7,704) | $(13,835) | $(16,025) |
| Basic and diluted loss per share | $(0.15) | $(0.24) | $(0.36) | $(0.50) |
Q2 2022 revenue was entirely service revenue; there were no product sales, compared with $199 of product sales in Q2 2021. Gross margin was 100% in Q2 2022 and 70% in Q2 2021, but the current-period figure reflects only $8 of service revenue and no cost of goods sold. Management attributed lower quarterly R&D expense to reduced research and clinical studies, partly offset by higher staffing. G&A declined, principally due to reduced ViralClear activity and lower stock compensation, while consulting, marketing and investor-relations fees increased in Q2.
Cash, liquidity and capitalization
- At June 30, cash was $5,077, down from $11,659 at December 31, 2021. Working capital was $5,837; total assets were $9,590 and total liabilities were $2,508.
- Six-month operating cash use was $12,644, investing cash use was $60, and financing provided $6,122, mainly from common-stock offerings. Cash decreased by $6,582 during the period.
- The company reported no convertible debentures outstanding. Reported obligations included lease liabilities of $950, including $341 current; the filing does not report conventional borrowings.
- Common shares outstanding rose from 35,567,180 at year-end to 44,811,880 at June 30. Equity funding included a March registered direct offering and a June public offering; the company also sold shares through a new $10 million ATM facility.
- Series C preferred stock conversion price reset from $2.27 to $0.75, producing a $108 noncash deemed dividend. The filing describes redemption triggers that could require cash or stock redemption, potentially beyond the company’s ability to meet.
Changes, outlook and risks
- Six-month revenue fell to $16 from $325, primarily reflecting the absence of product sales. Six-month operating cash use improved to $12,644 from $13,910, and the common-shareholder net loss narrowed to $13,835 from $16,025.
- Management states that substantial doubt exists about the company’s ability to continue as a going concern. It expects continued losses and negative operating cash flows and says additional financing is required. Plans include further commercialization, cost control, and raising funds through equity, debt or strategic partnerships; there is no assurance financing will be available or sufficient.
- Management said the commercial launch was expected in the latter part of 2022. Subsequent to quarter-end, on July 1, the company entered its first national purchasing agreement with HCA, including a 30-month system lease at Kansas City Heart Institute. The filing also discloses a July sales-type lease at $4,333 per month for 30 months.
- Management cited pandemic-related delays, market volatility and the Russia-Ukraine conflict as factors that could hinder commercialization and access to capital. The company relies on a limited supplier/manufacturer base and disclosed approximately $2,268 of purchase commitments, some modifiable or cancellable.
- On July 14, 2022, Nasdaq notified the company that its stock had been below the $1.00 minimum bid price for 30 consecutive business days. It had until January 10, 2023 to regain compliance, with a possible additional compliance period subject to conditions.
- The company reported no material legal proceedings known to it and said disclosure controls were effective; no material change in internal control over financial reporting was reported.
Important facts for investors to verify
- Confirm the intended issuer: the supplied filing is BioSig Technologies, not Streamex Corp.
- Assess cash runway and the timing, amount and terms of any financing needed, given $5.1 million cash and $12.6 million of operating cash use in six months.
- Track whether the HCA lease and other commercial activity translate into recurring system sales or service revenue, and whether product gross margins are sustainable.
- Review Nasdaq bid-price compliance status and any resulting listing or reverse-split actions.
- Examine dilution and potential redemption exposure from the Series C preferred reset, offerings, ATM capacity, warrants and equity compensation.
- Reconcile the MD&A’s accumulated-deficit figure of $202.750 million with the balance sheet’s $202.644 million; the filing text does not explain the difference.