2024 Q1 Form 10-Q Financial Statement

#000168316824000995 Filed on February 14, 2024

View on sec.gov

Income Statement

Concept 2024 Q1 2023 Q4
Revenue $10.31M $6.078M
YoY Change 8.77% 15.7%
Cost Of Revenue $5.594M $4.076M
YoY Change -15.4% 37.93%
Gross Profit $4.711M $2.002M
YoY Change 64.62% -12.89%
Gross Profit Margin 45.72% 32.94%
Selling, General & Admin $7.001M $6.227M
YoY Change 7.69% -12.04%
% of Gross Profit 148.6% 311.1%
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $170.7K $127.8K
YoY Change 80.95% 0.0%
% of Gross Profit 3.62% 6.38%
Operating Expenses $7.001M $6.227M
YoY Change 7.69% -12.04%
Operating Profit -$2.290M -$4.226M
YoY Change -37.08% -11.64%
Interest Expense $347.3K $214.0K
YoY Change 10.5% -82.47%
% of Operating Profit
Other Income/Expense, Net -$617.9K -$1.215M
YoY Change 51.97% -504.94%
Pretax Income -$2.908M -$5.440M
YoY Change -28.13% 21.37%
Income Tax $0.00
% Of Pretax Income
Net Earnings -$2.883M -$5.406M
YoY Change -28.39% 22.51%
Net Earnings / Revenue -27.97% -88.95%
Basic Earnings Per Share -$0.03 -$0.06
Diluted Earnings Per Share -$0.03 -$0.06
COMMON SHARES
Basic Shares Outstanding 90.39M shares 89.93M shares
Diluted Shares Outstanding 92.93M shares 89.96M shares

Balance Sheet

Concept 2024 Q1 2023 Q4
SHORT-TERM ASSETS
Cash & Short-Term Investments $533.6K $598.4K
YoY Change -58.6% -46.09%
Cash & Equivalents $533.6K $598.4K
Short-Term Investments
Other Short-Term Assets $582.9K $668.9K
YoY Change 72.54% 6.58%
Inventory $2.753M $2.570M
Prepaid Expenses
Receivables $9.841M $5.489M
Other Receivables $1.263M $1.240M
Total Short-Term Assets $15.88M $11.49M
YoY Change 23.81% 11.16%
LONG-TERM ASSETS
Property, Plant & Equipment $1.426M $1.623M
YoY Change 1.56% 6.24%
Goodwill $3.803M $3.803M
YoY Change -10.59% -10.59%
Intangibles $3.561M $3.655M
YoY Change -9.18% -2.29%
Long-Term Investments
YoY Change
Other Assets
YoY Change
Total Long-Term Assets $14.29M $14.93M
YoY Change -10.16% 1.43%
TOTAL ASSETS
Total Short-Term Assets $15.88M $11.49M
Total Long-Term Assets $14.29M $14.93M
Total Assets $30.17M $26.43M
YoY Change 5.01% 5.45%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $5.692M $5.554M
YoY Change 23.8% 117.67%
Accrued Expenses $1.132M $920.2K
YoY Change -34.12% -73.54%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00
YoY Change -100.0% -100.0%
Long-Term Debt Due $1.733M $439.6K
YoY Change 67.42% -36.04%
Total Short-Term Liabilities $10.56M $14.18M
YoY Change -63.53% -48.09%
LONG-TERM LIABILITIES
Long-Term Debt $2.919M $7.284M
YoY Change -78.74% -22.89%
Other Long-Term Liabilities $7.872M $7.898M
YoY Change -10.21% 1.05%
Total Long-Term Liabilities $10.79M $15.18M
YoY Change -52.03% -12.05%
TOTAL LIABILITIES
Total Short-Term Liabilities $10.56M $14.18M
Total Long-Term Liabilities $10.79M $15.18M
Total Liabilities $21.35M $29.36M
YoY Change -58.5% -34.13%
SHAREHOLDERS EQUITY
Retained Earnings -$154.8M -$152.0M
YoY Change 15.99% 17.37%
Common Stock $481.3K $471.4K
YoY Change 11.62% 10.08%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $8.760M -$3.020M
YoY Change
Total Liabilities & Shareholders Equity $30.17M $26.43M
YoY Change 5.01% 5.45%

Cashflow Statement

Concept 2024 Q1 2023 Q4
OPERATING ACTIVITIES
Net Income -$2.883M -$5.406M
YoY Change -28.39% 22.51%
Depreciation, Depletion And Amortization $170.7K $127.8K
YoY Change 80.95% 0.0%
Cash From Operating Activities -$2.184M -$1.720M
YoY Change -57.7% -53.57%
INVESTING ACTIVITIES
Capital Expenditures -$26.58K $200.9K
YoY Change -19.14% -64.24%
Acquisitions
YoY Change
Other Investing Activities $0.00 $0.00
YoY Change -100.0% -100.0%
Cash From Investing Activities $26.58K -$200.9K
YoY Change -36.68% -59.07%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities 2.139M 2.222M
YoY Change -56.11% -43.39%
NET CHANGE
Cash From Operating Activities -2.184M -1.720M
Cash From Investing Activities 26.58K -200.9K
Cash From Financing Activities 2.139M 2.222M
Net Change In Cash -18.67K 301.8K
YoY Change -92.47% -212.08%
FREE CASH FLOW
Cash From Operating Activities -$2.184M -$1.720M
Capital Expenditures -$26.58K $200.9K
Free Cash Flow -$2.158M -$1.920M
YoY Change -57.94% -54.98%

Facts In Submission

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us-gaap Profit Loss
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DFCO Change In Fair Value Of Contingent Consideration
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DFCO Change In Fair Value Of Contingent Consideration
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DFCO Increase Decrease In Longterm Payables
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us-gaap Net Cash Provided By Used In Financing Activities
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<p id="xdx_80C_eus-gaap--NatureOfOperations_zO5pJpRvZgTg" style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </p> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: top"> <td style="width: 48px; text-align: justify"><span style="font-size: 10pt"><b>1.</b></span></td> <td style="text-align: justify"><span style="font-size: 10pt"><b><span id="xdx_82B_zzA2d2wMoD5i">Organization and Nature of Operations</span></b></span></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">Moving the world forward takes bold resolve that turns ideas into actions and builds real-time solutions that positively impact people and the planet. Dalrada accelerates positive change for current and future generations by harnessing true potential and developing products and services that become transformative innovations.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Dalrada Financial Corporation, (“Dalrada”), was incorporated in September 1982 under the laws of the State of California. It was reincorporated in May 1983 under the laws of the State of Delaware and reincorporated again on May 5, 2020, under the laws of the state of Wyoming. Dalrada Financial Corporation trades under the symbol, OTCQB: DFCO.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Dalrada has five business divisions: <b>Genefic</b>, <b>Dalrada Climate Technology</b>, <b>Dalrada Precision Manufacturing</b>, <b>Dalrada Technologies </b>and <b>Dalrada Corporate</b>. Within each of these divisions, the Company drives transformative innovation while creating solutions that are sustainable, accessible, and affordable. Dalrada’s global solutions directly address climate change, gaps in the health care industry, and technology needs that facilitate a new era of human behavior and interaction and ensure a bright future for the world around us.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><b><span style="text-decoration: underline">Genefic (Formerly Dalrada Health)</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">Genefic delivers advanced health care solutions with dedicated products, services, and systems. From virus and disease screening capabilities to pharmaceutical goods and holistic wellness clinics, When the world needs advanced health care, Genefic delivers with ingenuity, accessibility, and affordability. This specialized division is committed to developing key health products, lifesaving medications and building comprehensive systems to increase capability, strive to keep people healthy with the goals of improving their quality of life and increasing their longevity– on a global level.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><b>Boost Diagnostics</b>- Boost Diagnostics (formerly Empower Genomics and Genefic Diagnostics) is Dalrada’s wholly owned diagnostic laboratory subsidiary which processes molecular diagnostic and antibody tests to support the diagnosis of COVID-19 and the detection of immune response to the virus. Boost Diagnostics has built up and maintained the testing capacity to handle surges in COVID-19 testing demands. Boost Diagnostics also offers genetic testing capabilities including Pharmacogenomics, Nutraceutical, Nutrition/Diet DNA and Exercise/Fitness DNA tests.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><b>Pala Diagnostics (“Pala”)</b>- Pala was a joint venture diagnostic laboratory entity which processed both molecular diagnostic and antibody tests to support the diagnosis of COVID-19 and the detection of immune response to the virus. Pala was no longer an operational entity as of June 30, 2023.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><b>Genefic Wellness Group (“Genefic Wellness”)</b>- Genefic Wellness (formerly Solas Corp.) manages and oversees wellness clinics throughout Southern California including the Sòlas Rejuvenation + Wellness clinics (“Sòlas”). Through advanced medical techniques and modern technology, Sòlas delivers a clinical experience that helps men and woman live their best life, whether it’s through simple cosmetic procedures, pain-reducing practices, or anti-aging therapies. Through its three locations, Sòlas prides itself on its dedicated service-focused, health-first approach. Its wellness &amp; rejuvenation clinics deliver with a focus on regenerative therapies, IV and injection services, cosmetic enhancements amongst a myriad of additional health centric services.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><b>Achieve Wellness-</b> Achieve Wellness is a full-service consulting company which helps businesses incorporate effective weight loss and wellness programs. Achieve Wellness’ services include the integration of cutting-edge technologies, products, and services specific to weight loss strategies.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><b>International Health Group (“IHG”)</b>- IHG provides highly trained nursing and medical assistants for hospitals and home health facilities since 2006. IHG Medical Assistant programs include Certified Nursing Assistant (“CNA") and Home Health Aide (“HHA”) training and the fast-track 22-Day CNA Certification Program at its state-approved testing facility.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><b>Pacific Stem Cells (“PSC”)</b>- PSC markets and sells traditional biologics and human cells, tissues, and cellular and tissue-based products (HCT/Ps).</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><b>Genefic Specialty Pharmacy (“Genefic Pharmacy”)</b>- Genefic Pharmacy (formerly Watson Rx Solutions) is an Alabama-based pharmacy with more than 30 years of experience in the retail medical and pharmaceutical industries. Genefic Pharmacy specializes in providing expert care and managing disease states through comprehensive prescription management, education, nursing, and total health solutions. Genefic Pharmacy maintains pharmacy licenses in all 50 States including Washington D.C.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><b><span style="text-decoration: underline">Dalrada Climate Technology (formerly Dalrada Energy Services)</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">Dalrada Climate Technology (“DCT”) is a segment which incapsulates energy services and state-of-the-art technology within the climate sustainability space. DCT employs next-generation technology and services which enhances clean energy efforts while reducing the world’s carbon footprint. As a premier industrial heat pump manufacturer, Dalrada delivers innovation and efficiency, building solutions that reduce energy consumption and minimize carbon footprints, increase operational efficiencies, meet environmental, social, and governance (ESG) goals, and lower energy costs for clients. </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><b>Likido Ltd. (“Likido”)</b>- Likido is an international engineering company developing advanced solutions for the harvesting and recycling of energy. Using its novel, heat pump systems (patent pending), Likido is working to revolutionize the renewable energy sector with the provision of innovative modular process technologies to maximize the capture and reuse of thermal energy for integrated heating and cooling applications. With uses across industrial, commercial and residential sectors, Likido provides cost savings and minimized carbon emissions across global supply chains. Likido's technologies enable the effective recovery and recycling of process energy, mitigating against climate change and expected enhancement of quality of life through the provision of low-carbon heating and cooling systems. Likido’s products currently include the DCT One Series Heat Pumps (formerly Likido®ONE) and DCT Cryo Chiller.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">During the prior year, the U.S. Government selected DCT One Series high-performance, low-carbon heat pump for real-world testing in a prestigious clean energy program. The implementation of the DCT One Series testing is still in process. The expected positive results should not only increase market acceleration and adoption within the federal government acceptance of groundbreaking eco-friendly technology but should also accelerate adoption within the commercial building industry.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><b> </b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><b>Dalrada Technology Limited (“DTL”)- </b>DTL is a holding company for all European based Dalrada Precision entities.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><b> </b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><b>Dalrada Technology Spain L.T. (“DTS”)- </b>DTS was established as a Spanish subsidiary of DTL for the expansion of the manufacturing and sale of the DCT One Series and DCT Cryo Chiller throughout Europe.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><b>Dalrada Energy Services (“DES”)</b>- DES provides end-to-end comprehensive energy service solutions in a robust commercial capacity. DES helps organizations meet ESG goals and standards while mitigating negative environmental impacts.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><b>Bothof Brothers Construction (“Bothof”)</b>- Bothof is a licensed general contractor which provides a wide range of development, construction and design capabilities and expertise throughout the United States. Through Bothof’s extensive experience in construction and contracting, the DES division can provide a myriad of additional services to its private and public works customers.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><b>Dalrada Financial Corporation Morocco (“DFCM”)- </b>DFCM was established as a Moroccan subsidiary of Dalrada to conduct energy service solutions within the country of Morocco. Dalrada owns a <span id="xdx_904_eus-gaap--EquityMethodInvestmentOwnershipPercentage_iI_dp_c20231231__srt--ScheduleOfEquityMethodInvestmentEquityMethodInvesteeNameAxis__custom--DalradaFinancialCorporationMoroccoMember_zQGrNS2ogAI6">33</span>% equity interest in DFCM.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><b><span style="text-decoration: underline">Dalrada Precision Manufacturing</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">Dalrada Precision Manufacturing creates total manufacturing solutions that start with the design and development of high-quality machine parts and components, and end with an efficient global supply chain. This specialized business division can meet today’s high demands and solves industry challenges. Dalrada Precision Manufacturing is confident that it redefines the critical quality of the world’s top components and responds with in-house research, design, engineering, and distribution through a highly reliable global supply chain and improved time-to-market capabilities.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><b>Dalrada Precision Parts (“Precision”)</b>- Precision extends the client its engineering and operations team by helping devise unique manufacturing solutions tailored to their products. Dalrada Precision can enter at any stage of the product lifecycle from concept and design to mass production and logistics.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><b>Deposition Technologies (“DepTec”)</b>- DepTec designs, develops, manufactures, and services chemical vapor and physical vapor deposition systems for the microchip and semiconductor industries.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">DepTec has built an impressive catalogue of precision OEM parts for PVD (<span style="background-color: white">Physical vapor deposition)</span> systems and the Company’s refurbished systems which allows clients the option of purchasing the same model of system they’ve been using for decades –but with significant upgrades and improved efficiencies. Older systems can now operate more reliably with additional control and monitoring plus longer lifespans. DepTec also has its own PVD and CVD (Chemical Vapor Deposition) systems, EVOS-PVD and EVOS -CVD, which deposits metals and non-metals for microchips used in almost every standard and specialized microdevices made today and in the future. These systems can produce a superior film layer utilized in rugged high-stress environment designs.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><b>Ignite I.T. (“Ignite”)</b>- Ignite is a manufacturer and seller of eco-friendly deep cleaners, parts washers and degreasers that are specially formulated to lift hydrocarbon-based dirt and grease from virtually all surfaces with minimal effort. Ignite products are non-flammable, non-corrosive, non-toxic, butyl-free, water-based, and leave a light citrus scent. Ignite is developed for all surfaces suitable for water and meets or exceed the most stringent industry-testing specifications.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><b><span style="text-decoration: underline">Dalrada Technologies</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Dalrada Technologies has worked with some of the world’s most recognizable companies, providing digital engineering for cutting-edge software systems and offering a host of robust digital services. This business division connects the world with integrated technology and innovative solutions, delivering advanced capabilities and error-free results. Dalrada Technologies creates digital products with expert computer information technology and software engineering services for a variety of technical industries and clients in both B2B and B2C environments.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><b>Prakat (“Prakat”)</b>- Prakat is an ISO 9001-certified company that provides end-to-end technology services across various industries, improving the value chain. The Company specializes in test engineering, accessibility engineering, product engineering, application modernization, billing and revenue management, CRM, and block chain. Prakat provides global customers with software and technology solutions specializing in Test Engineering, Accessibility Engineering, Product Engineering and Application Modernization.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><b><span style="text-decoration: underline">Dalrada Corporate</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Dalrada Corporate covers the activities which support the entire suite of Dalrada subsidiaries. Dalrada Corporate includes the areas of administration, finance, human resources, legal advice, information technology, and marketing. It also contains executive management and shareholder-related services.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><i><span style="text-decoration: underline">Liquidity and Going Concern</span></i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">These unaudited interim condensed consolidated financial statements have been prepared on a going concern basis, which implies that the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The continuation of the Company as a going concern is dependent upon the continued financial support from related parties, its ability to identify future investment opportunities, obtain the necessary debt or equity financing, and generate profitable operations. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These condensed consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.</p>
us-gaap Use Of Estimates
UseOfEstimates
<p id="xdx_84E_eus-gaap--UseOfEstimates_zZgHMRvQxc4c" style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: top"> <td style="width: 48px"> </td> <td style="width: 24px"><span style="font-size: 10pt">(c)</span></td> <td style="text-align: justify"><span style="font-size: 10pt"><span id="xdx_861_zU2sQC3kwO4">Use of Estimates</span></span></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.75in; text-align: justify">The preparation of these unaudited interim condensed consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to the revenue, valuation of inventory, valuation of acquired assets and liabilities, variables used in the computation of share-based compensation, litigation, contingent consideration, and evaluation of goodwill and intangible assets for impairment.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.75in; text-align: justify">The Company bases its estimates and assumptions on current facts, historical experience, and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.</p>
us-gaap Concentration Risk Credit Risk
ConcentrationRiskCreditRisk
<p id="xdx_84F_eus-gaap--ConcentrationRiskCreditRisk_zIdpe6gltsM4" style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: top"> <td style="width: 48px"> </td> <td style="width: 24px"><span style="font-size: 10pt">(d)</span></td> <td style="text-align: justify"><span style="font-size: 10pt"><span id="xdx_86C_zgHT0Dngpqu">Concentrations of Credit Risk</span></span></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.75in; text-align: justify">  </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.75in; text-align: justify">Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents, as well as accounts receivable. The Company generally maintains balances in various operating accounts at financial institutions that management believes to be of high credit quality, in amounts that may exceed federally insured limits. The Company has not experienced any losses related to its cash and cash equivalents and does not believe that it is subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.75in; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.75in; text-align: justify">When estimating its allowance for credit losses related to revenues from Covid Testing and pharmacy sales, the Company differentiates its receivables based on the following customer types: healthcare insurers, government payers, and cash payers. Additionally, the Company applies assumptions and judgments for assessing collectability and determining net revenues and accounts receivable from its customers. Management considers various historical collection factors for assessing collectability and determining net revenues and accounts receivable from our customers which include the period that the receivables have been outstanding, history of payment amounts, status of collections due, and applicable statutes of limitations.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.75in; text-align: justify">During the six months ended December 31, 2023 and December 31, 2022, healthcare insurers, government payers and OTC pharmaceutical sales accounted for over <span id="xdx_902_eus-gaap--ConcentrationRiskPercentage1_dp_c20230701__20231231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesRevenueNetMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember__srt--MajorCustomersAxis__custom--HealthcareInsurersGovernmentPayersAndOTCPharmaceuticalSalesMember_zyYsD0TEc18l" title="Concentrations risk, percentage">49</span>% and <span id="xdx_900_eus-gaap--ConcentrationRiskPercentage1_dp_c20220701__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesRevenueNetMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember__srt--MajorCustomersAxis__custom--HealthcareInsurersGovernmentPayersAndOTCPharmaceuticalSalesMember_zbsbMDWdEFSb" title="Concentrations risk, percentage">38</span>% of total revenues, respectively. Also, healthcare insurers, government payers and OTC pharmaceutical sales amounted to total revenues of $<span id="xdx_90E_eus-gaap--Revenues_pp0p0_c20230701__20231231__srt--ProductOrServiceAxis__custom--HealthcareInsurersGovernmentPayersAndOTCPharmaceuticalSalesMember_zLE70vvtq8Ud" title="Revenues">5,502,854</span> and $<span id="xdx_905_eus-gaap--Revenues_pp0p0_c20220701__20221231__srt--ProductOrServiceAxis__custom--HealthcareInsurersGovernmentPayersAndOTCPharmaceuticalSalesMember_zJJZwGaSOvz9" title="Revenues">1,710,799</span> for the six months ended December 31, 2023 and 2022, respectively. The accounts receivable related to both healthcare insurers and government payers is $<span id="xdx_909_eus-gaap--AccountsReceivableNet_iI_pp0p0_c20231231__srt--ProductOrServiceAxis__custom--HealthcareInsurersAndGovernmentPayersMember_za3VGFrrvb72" title="Accounts receivable">3,585,109</span> and $<span id="xdx_902_eus-gaap--AccountsReceivableNet_iI_pp0p0_c20230630__srt--ProductOrServiceAxis__custom--HealthcareInsurersAndGovernmentPayersMember_z69ckvXRD8Rg" title="Accounts receivable">1,499,415</span> as of December 31, 2023 and June 30, 2023, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.75in; text-align: justify">  </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.75in; text-align: justify">As of December 31, 2023 and June 30, 2023, $<span id="xdx_90A_eus-gaap--AccountsReceivableNet_c20231231__srt--ProductOrServiceAxis__custom--LikidoUnitsMember_pp0p0" title="Accounts receivable">618,031</span> and $<span id="xdx_908_eus-gaap--AccountsReceivableNet_c20230630__srt--ProductOrServiceAxis__custom--LikidoUnitsMember_pp0p0" title="Accounts receivable">829,239</span> is owed by customers from the sale of Likido units, respectively.</p>
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CY2023Q2 us-gaap Derivative Fair Value Of Derivative Net
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CY2023Q4 us-gaap Allowance For Doubtful Accounts Receivable
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CY2023Q4 DFCO Change In Fair Value Of Contingent Consideration1
ChangeInFairValueOfContingentConsideration1
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DFCO Change In Fair Value Of Contingent Consideration1
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CY2023Q4 DFCO Contingent Consideration
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us-gaap Goodwill Impairment Loss
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CY2022Q4 us-gaap Revenue From Contract With Customer Excluding Assessed Tax
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us-gaap Revenue From Contract With Customer Excluding Assessed Tax
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us-gaap Revenue From Contract With Customer Excluding Assessed Tax
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9510887 usd
CY2023Q4 us-gaap Accounts Receivable Net
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CY2023Q2 us-gaap Accounts Receivable Net
AccountsReceivableNet
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CY2023Q2 DFCO Accounts Receivable Net Related Parties Current
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LongTermInvestmentsAndReceivablesNet
20141 usd
CY2023Q2 us-gaap Long Term Investments And Receivables Net
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41722 usd
CY2023Q4 DFCO Longterm Receivables Related Parties Current
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CY2023Q2 DFCO Longterm Receivables Related Parties Current
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CY2023Q4 us-gaap Deferred Revenue
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CY2023Q2 us-gaap Deferred Revenue
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1337259 usd
CY2023Q4 us-gaap Cost Of Goods And Services Sold
CostOfGoodsAndServicesSold
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CY2022Q4 us-gaap Cost Of Goods And Services Sold
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2955132 usd
us-gaap Cost Of Goods And Services Sold
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8123224 usd
us-gaap Cost Of Goods And Services Sold
CostOfGoodsAndServicesSold
5311460 usd
CY2023Q4 us-gaap Advertising Expense
AdvertisingExpense
65000 usd
CY2022Q4 us-gaap Advertising Expense
AdvertisingExpense
92000 usd
us-gaap Advertising Expense
AdvertisingExpense
106000 usd
us-gaap Advertising Expense
AdvertisingExpense
201000 usd
CY2023Q4 us-gaap Share Based Compensation
ShareBasedCompensation
1018827 usd
CY2022Q4 us-gaap Share Based Compensation
ShareBasedCompensation
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us-gaap Share Based Compensation
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2128469 usd
us-gaap Share Based Compensation
ShareBasedCompensation
1369238 usd
us-gaap Other Depreciation And Amortization
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177094 usd
CY2023Q4 us-gaap Other Depreciation And Amortization
OtherDepreciationAndAmortization
94371 usd
CY2022Q4 us-gaap Other Depreciation And Amortization
OtherDepreciationAndAmortization
133435 usd
CY2023Q4 DFCO Notes Payable Related Parties
NotesPayableRelatedParties
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CY2023Q4 us-gaap Inventory Raw Materials
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1039674 usd
CY2023Q2 us-gaap Inventory Raw Materials
InventoryRawMaterials
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CY2023Q4 us-gaap Inventory Work In Process
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1120243 usd
CY2023Q2 us-gaap Inventory Work In Process
InventoryWorkInProcess
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CY2023Q4 us-gaap Inventory Finished Goods
InventoryFinishedGoods
409926 usd
CY2023Q2 us-gaap Inventory Finished Goods
InventoryFinishedGoods
712510 usd
CY2023Q4 us-gaap Inventory Net
InventoryNet
2569843 usd
CY2023Q2 us-gaap Inventory Net
InventoryNet
2078692 usd
CY2023Q4 us-gaap Machinery And Equipment Gross
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1866443 usd
CY2023Q2 us-gaap Machinery And Equipment Gross
MachineryAndEquipmentGross
1448556 usd
CY2023Q4 us-gaap Leasehold Improvements Gross
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351284 usd
CY2023Q2 us-gaap Leasehold Improvements Gross
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208689 usd
CY2023Q4 us-gaap Capitalized Computer Software Gross
CapitalizedComputerSoftwareGross
414648 usd
CY2023Q2 us-gaap Capitalized Computer Software Gross
CapitalizedComputerSoftwareGross
426162 usd
CY2023Q4 us-gaap Construction In Progress Gross
ConstructionInProgressGross
0 usd
CY2023Q2 us-gaap Construction In Progress Gross
ConstructionInProgressGross
249613 usd
CY2023Q4 us-gaap Property Plant And Equipment Gross
PropertyPlantAndEquipmentGross
2632375 usd
CY2023Q2 us-gaap Property Plant And Equipment Gross
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2333020 usd
CY2023Q4 us-gaap Accumulated Depreciation Depletion And Amortization Property Plant And Equipment
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CY2023Q2 us-gaap Accumulated Depreciation Depletion And Amortization Property Plant And Equipment
AccumulatedDepreciationDepletionAndAmortizationPropertyPlantAndEquipment
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CY2023Q4 us-gaap Property Plant And Equipment Net
PropertyPlantAndEquipmentNet
1623011 usd
CY2023Q2 us-gaap Property Plant And Equipment Net
PropertyPlantAndEquipmentNet
1476082 usd
us-gaap Depreciation Depletion And Amortization
DepreciationDepletionAndAmortization
152426 usd
us-gaap Depreciation Depletion And Amortization
DepreciationDepletionAndAmortization
171418 usd
CY2023Q4 us-gaap Depreciation Depletion And Amortization
DepreciationDepletionAndAmortization
127759 usd
CY2022Q4 us-gaap Depreciation Depletion And Amortization
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82360 usd
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CY2023Q4 us-gaap Finite Lived Intangible Assets Gross
FiniteLivedIntangibleAssetsGross
4350891 usd
CY2023Q2 us-gaap Finite Lived Intangible Assets Accumulated Amortization
FiniteLivedIntangibleAssetsAccumulatedAmortization
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DFCO Finite Lived Intangible Assets Accumulated Amortization Additions
FiniteLivedIntangibleAssetsAccumulatedAmortizationAdditions
-203263 usd
CY2023Q4 us-gaap Finite Lived Intangible Assets Accumulated Amortization
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-696068 usd
CY2023Q4 us-gaap Finite Lived Intangible Assets Net
FiniteLivedIntangibleAssetsNet
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us-gaap Other Depreciation And Amortization
OtherDepreciationAndAmortization
203263 usd
CY2023Q4 us-gaap Interest Payable Current And Noncurrent
InterestPayableCurrentAndNoncurrent
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CY2023Q2 DFCO Notes Payable Related Parties
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1900083 usd
CY2023Q2 us-gaap Interest Payable Current And Noncurrent
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14182 usd
CY2023Q4 DFCO Notes Payable Related Parties Current
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0 usd
CY2023Q4 DFCO Notes Payable Related Parties Noncurrent1
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4834971 usd
CY2023Q4 DFCO Notes Payable Related Parties
NotesPayableRelatedParties
4834971 usd
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CY2023Q2 DFCO Notes Payable Related Parties Noncurrent1
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1648478 usd
CY2023Q2 DFCO Notes Payable Related Parties
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CY2023Q4 us-gaap Notes Payable Current
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CY2023Q4 us-gaap Long Term Notes Payable
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2414936 usd
CY2023Q2 us-gaap Long Term Notes Payable
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CY2023Q4 us-gaap Notes Payable
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2854498 usd
CY2023Q2 us-gaap Notes Payable
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CY2023Q4 us-gaap Debt Instrument Carrying Amount
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600000 usd
DFCO Redemption Premium In Cash
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0 usd
DFCO Redemption Premium In Cash
RedemptionPremiumInCash
120000 usd
DFCO Redemption Premium In Stock
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0 usd
DFCO Redemption Premium In Stock
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120000 usd
DFCO Accretion Interest Expense
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DFCO Accretion Interest Expense
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180000 usd
DFCO Redeemed Cash
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0 usd
DFCO Redeemed Cash
RedeemedCash
600000 usd
DFCO Redeemed Debentures
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DFCO Redeemed Debentures
RedeemedDebentures
300000 usd
CY2023Q4 DFCO Revenues Related Party
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CY2022Q4 DFCO Revenues Related Party
RevenuesRelatedParty
649242 usd
DFCO Revenues Related Party
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DFCO Revenues Related Party
RevenuesRelatedParty
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0.59
CY2022Q1 DFCO Fair Value Of Options Granted
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CY2022Q3 us-gaap Class Of Warrant Or Right Exercise Price Of Warrants Or Rights1
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0.45
CY2022Q3 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Non Option Equity Instruments Outstanding Number
ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsOutstandingNumber
250000 shares
CY2022Q4 us-gaap Class Of Warrant Or Right Exercise Price Of Warrants Or Rights1
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0.15
CY2023Q2 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Grants In Period Weighted Average Grant Date Fair Value
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0.08
CY2023Q2 DFCO Fair Value Of Options Granted
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CY2023Q2 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Grants In Period Weighted Average Grant Date Fair Value
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriodWeightedAverageGrantDateFairValue
0.10
CY2023Q2 DFCO Fair Value Of Options Granted
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47408 usd
CY2023Q3 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Grants In Period Weighted Average Grant Date Fair Value
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriodWeightedAverageGrantDateFairValue
0.08
CY2023Q3 DFCO Fair Value Of Options Granted
FairValueOfOptionsGranted
2064699 usd
CY2022Q2 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Number
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber
12025000 shares
CY2022Q2 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Weighted Average Exercise Price
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingWeightedAverageExercisePrice
0
CY2022 us-gaap Sharebased Compensation Arrangement By Sharebased Payment Award Options Outstanding Weighted Average Remaining Contractual Term2
SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm2
P8Y9M25D
CY2023 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Grants In Period
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CY2023 us-gaap Share Based Compensation Arrangements By Share Based Payment Award Options Grants In Period Weighted Average Exercise Price
ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsGrantsInPeriodWeightedAverageExercisePrice
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CY2023 us-gaap Share Based Compensation Arrangements By Share Based Payment Award Options Exercises In Period Weighted Average Exercise Price
ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsExercisesInPeriodWeightedAverageExercisePrice
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CY2023 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Forfeitures And Expirations In Period Weighted Average Exercise Price
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsForfeituresAndExpirationsInPeriodWeightedAverageExercisePrice
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CY2023Q2 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Number
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us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Grants In Period
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CY2023Q4 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Number
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CY2023Q4 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Weighted Average Exercise Price
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CY2023Q4 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Exercisable Number
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SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsExercisableWeightedAverageRemainingContractualTerm1
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us-gaap Share Based Compensation
ShareBasedCompensation
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us-gaap Share Based Compensation
ShareBasedCompensation
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CY2023Q4 us-gaap Employee Service Share Based Compensation Nonvested Awards Total Compensation Cost Not Yet Recognized
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5318203 usd
CY2023Q4 us-gaap Revenues
Revenues
6077762 usd
CY2023Q4 us-gaap Operating Income Loss
OperatingIncomeLoss
-4225674 usd
CY2022Q4 us-gaap Revenues
Revenues
5253120 usd
CY2022Q4 us-gaap Operating Income Loss
OperatingIncomeLoss
-4782089 usd
us-gaap Revenues
Revenues
11095842 usd
us-gaap Operating Income Loss
OperatingIncomeLoss
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us-gaap Revenues
Revenues
9510887 usd
us-gaap Operating Income Loss
OperatingIncomeLoss
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us-gaap Revenues
Revenues
11095842 usd
us-gaap Revenues
Revenues
9510887 usd
CY2023Q4 us-gaap Inventory Net
InventoryNet
2569843 usd
CY2023Q2 us-gaap Inventory Net
InventoryNet
2078692 usd
CY2023Q4 us-gaap Property Plant And Equipment Net
PropertyPlantAndEquipmentNet
1623011 usd
CY2023Q2 us-gaap Property Plant And Equipment Net
PropertyPlantAndEquipmentNet
1476082 usd
CY2023Q4 us-gaap Lessee Operating Lease Liability Payments Remainder Of Fiscal Year
LesseeOperatingLeaseLiabilityPaymentsRemainderOfFiscalYear
764412 usd
CY2023Q4 us-gaap Lessee Operating Lease Liability Payments Due Next Twelve Months
LesseeOperatingLeaseLiabilityPaymentsDueNextTwelveMonths
1441424 usd
CY2023Q4 us-gaap Lessee Operating Lease Liability Payments Due Year Two
LesseeOperatingLeaseLiabilityPaymentsDueYearTwo
1353474 usd
CY2023Q4 us-gaap Lessee Operating Lease Liability Payments Due Year Three
LesseeOperatingLeaseLiabilityPaymentsDueYearThree
1234880 usd
CY2023Q4 us-gaap Lessee Operating Lease Liability Payments Due Year Four
LesseeOperatingLeaseLiabilityPaymentsDueYearFour
432131 usd
CY2023Q4 DFCO Lessee Operating Lease Liability Payments Due After Year Four
LesseeOperatingLeaseLiabilityPaymentsDueAfterYearFour
32627 usd
CY2023Q4 us-gaap Lessee Operating Lease Liability Payments Due
LesseeOperatingLeaseLiabilityPaymentsDue
5258948 usd
CY2023Q4 us-gaap Lessee Operating Lease Liability Undiscounted Excess Amount
LesseeOperatingLeaseLiabilityUndiscountedExcessAmount
469796 usd
CY2023Q4 us-gaap Operating Lease Liability
OperatingLeaseLiability
4789152 usd
CY2023Q4 us-gaap Operating Lease Weighted Average Remaining Lease Term1
OperatingLeaseWeightedAverageRemainingLeaseTerm1
P3Y6M21D
CY2023Q2 us-gaap Operating Lease Weighted Average Remaining Lease Term1
OperatingLeaseWeightedAverageRemainingLeaseTerm1
P4Y1M2D
CY2023Q4 us-gaap Operating Lease Weighted Average Discount Rate Percent
OperatingLeaseWeightedAverageDiscountRatePercent
0.0684 pure
CY2023Q2 us-gaap Operating Lease Weighted Average Discount Rate Percent
OperatingLeaseWeightedAverageDiscountRatePercent
0.0674 pure

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