Karbon-X Corp 10-Q for FY2024 Q1

Karbon-X Corp. (KARX)

10-Q 2023-10-23 For: 2023-08-31

Added on April 06, 2026

About this 10-Q

Karbon-X Corp filed this 10-Q on October 23, 2023, covering the quarter ended August 31, 2023 (FY2024 Q1).

Headline figures

Quarter ended August 31, 2023, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $3758; compared with $0 a year earlier
Net loss: $350.03K; compared with a net loss of $195.87K a year earlier

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PART I—FINANCIAL INFORMATION

Item 1.	Financial Statements.	4
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	14
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	18
Item 4.	Controls and Procedures.	18

PART II—OTHER INFORMATION

Item 1.	Legal Proceedings.	19
Item 1A.	Risk Factors.	19
Item 2.	Unregistered Sales of Securities and Use of Proceeds.	19
Item 3.	Defaults Upon Senior Securities.	19
Item 4.	Mining Safety Disclosure.	19
Item 5.	Other Information.	19
Item 6.	Exhibits.	20

PART I	FINANCIAL INFORMATION

	Consolidated Balance Sheets as of August 31, 2023 (Unaudited) and May 31, 2023	4

	Consolidated Statement of Operations for the Three Months Ended August 31, 2023 and 2022 (Unaudited)	5

	Consolidated Statements of Stockholders’ Equity (Deficit) for the Three Months Ended August 31, 2023 and 2022 (Unaudited)	6

	Consolidated Statements of Cash Flows for the Three Months Ended August 31, 2023 and 2022(Unaudited)	7

	Notes to Consolidated Financial Statements (Unaudited)	8

	August 31, 2023			May 31, 2023
	(Unaudited)
ASSETS
Current assets
Cash and cash equivalents	$	974,356		$	206,820
Sales tax receivable		20,308			45,586
Prepaid expenses and other current assets		61,697			59,767
Total current assets		1,056,361			312,173

Property and equipment		8,605			9,116
Internally developed software		524,871			522,771
Right of use asset		63,924			68,307
Inventory		139,121			80,750
Investment in Silviculture		2,464,203			1,514,483
Security deposit		7,545			7,515
Total assets	$	4,264,630		$	2,515,115

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	29,907		$	69,732
Current portion of lease liability		22,376			14,688
Short term loan		-			100,000
Deferred revenue		195,372			-
Payroll liabilities		24,513			10,061
Total current liabilities		272,168			194,481

Noncurrent portion of lease liability		49,827			55,415
Total liabilities		321,995			249,896

Commitments and contingencies		-			-

Shareholders’ equity (deficit)
Common stock $0.001 par value, 200,000,000 shares authorized, 78,553,858 and 72,579,000 shares issued and outstanding as of August 31, 2023 and May 31, 2023, respectively.		78,554			72,579
Shares to be issued		1,500,000			1,750,000
Additional Paid-in capital		4,913,228			2,638,532
Accumulated deficit		(2,542,138	)		(2,192,106	)
Accumulated other comprehensive gain (loss)		(7,009	)		(3,786	)
Total shareholders’ equity		3,942,635			2,265,219
Total liabilities and shareholders’ equity	$	4,264,630		$	2,515,115

	For the Three Months Ended			For the Three Months Ended
	August 31, 2023			August 31, 2022
	(Unaudited)			(Unaudited)
Operations
Total revenue	$	3,758		$	-
Cost of revenue		549			-
Gross profit		3,209			-

Marketing expenses		21,395			10,664
Salaries and wages		172,887			-
Professional fees		78,291			86,595
Other operating expenses		52,901			98,609
Total operating expenses		325,474			195,868

Loss from Operations		(322,265	)		(195,868	)

Other income (expenses)		(27,767	)		-
Net loss before income taxes		(350,032	)		(195,868	)
Federal income tax expense		-			-
Net loss		(350,032	)		(195,868	)

Other comprehensive loss
Foreign currency translation gain (loss)		(3,223	)		(10,217	)
Total comprehensive loss		(353,255	)		(206,085	)

Earnings Per Share
Weighted average basic and diluted shares outstanding		75,895,837			68,882,637
Basic and fully diluted loss per share	$	(0.00	)	$	(0.00	)

	Common Stock				Shares to		Additional Paid		Accumulated			Accumulated other Comprehensive
Description	Shares		Amount		be issued		in Capital		Deficit			gain (loss)			Total
Balance May 31, 2022		68,320,000	$	68,320	$	-	$	786,822	$	(204,228	)	$	(13,044	)	$	637,870
Issuance of shares and warrants for cash		720,000		720		-		179,280		-			-			180,000
Translation gain (loss)													(10,217	)		(10,217	)
Net loss		-		-		-		-		(195,868	)		-			(195,868	)
Balance August 31, 2022		69,040,000	$	69,040	$	-	$	966,102	$	(400,096	)	$	(23,262	)	$	611,784

	Common Stock				Shares to			Additional Paid		Accumulated			Accumulated other Comprehensive
Description	Shares		Amount		be issued			in Capital		Deficit			gain (loss)			Total
Balance May 31, 2023		72,579,000	$	72,579	$	1,750,000		$	2,638,532	$	(2,192,106	)	$	(3,786	)	$	2,265,219
Shares to be issued for investment		-		-		375,000			-		-			-			375,000
Shares to issued as stock compensation		2,500,000		2,500		(625,000	)		622,500		-			-			-
Issuance of shares for cash and warrants, net		3,274,858		3,275		-			1,552,396		-			-			1,555,671
Conversion of loan to shares		200,000		200					99,800		-			-			100,000
Translation gain (loss)														(3,223	)		(3,223	)
Net loss		-		-		-			-		(350,032	)		-			(350,032	)
Balance August 31, 2023		78,553,858	$	78,554	$	1,500,000		$	4,913,228	$	(2,542,138	)	$	(7,009	)	$	3,942,635

	●	Level 1—Observable inputs that reflect quoted market prices (unadjusted) for identical assets or liabilities in active markets;

	●	Level 2—Observable inputs other than quoted prices in active markets that are observable either directly or indirectly in the marketplace for identical or similar assets and liabilities; and

	●	Level 3—Unobservable inputs that are supported by little or no market data, which require the Company to develop its own assumptions.

Description	Number		Weighted average exercise price		Weighted average remaining contractual life (in years)
Outstanding May 31, 2023		4,140,000	$	0.75		0.58
Exercised		-		-		-
Granted		10,400		0.50		1.92
Expired		-		-		-
Cancelled		-		-		-
Outstanding August 31, 2023		4,150,400	$	0.75		0.68

SCHEDULE OF FUTURE MINIMUM LEASE PAYMENTS UNDER OPERATING LEASES	Total
Year Ended May 31,
2024	$	21,558
2025		28,745
2026		28,745
2027		4,791
Thereafter		-
Total lease payment		83,839
Less: Imputed interest		(11,636	)
Operating lease liabilities		72,203

Operating lease liability - current		22,376
Operating lease liability - non-current	$	49,827

SCHEDULE OF OTHER SUPPLEMENTAL INFORMATION UNDER OPERATING LEASE
Weighted average discount rate	10.25	%
Weighted average remaining lease term (years)	2.92

	Three Months Ended
	August 31, 2023
Cash used in operating activities	$	(180,276	)
Cash provided by financing activities	$	1,555,671
Cash from (used in) investing activities	$	(602,407	)
Change in cash during the period	$	767,536
Effect of exchange rate change	$	(5,452	)
Cash, beginning of period	$	206,820
Cash, end of period	$	974,356

31.1		Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Executive Officer

31.2		Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Financial Officer

32.1		Section 1350 Certification of Chief Executive Officer

32.2		Section 1350 Certification of Chief Financial Officer

101		Interactive data files pursuant to Rule 405 of Regulation S-T.

	Karbon-X Corp. (Registrant)

Date: October 23, 2023	By:	/s/ Chad Clovis
		Chad Clovis
		Chief Executive Officer and Director {Principal and Executive Officer}

Date: October 23, 2023	By:	/s/ Christopher Mulgrew
		Christopher Mulgrew
		Chief Financial Officer (Principal Financial Officer Principal Accounting Officer)

1.	I have reviewed this quarterly report of Karbon-X Corp.;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.	I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in the Exchange Act Rules 13a-15(f) and 15d – 15(f)) for the registrant and have:

	a)	Designed such disclosure controls and procedures, or caused such controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

	b)	Designed such internal controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

	c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrants most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

	a)	All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and,

	b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

	1.	The Quarterly Report fully complies with the requirements of Section 13(a) or15(d) of the Securities and Exchange Act of 1934, as amended; and

	2.	The information contained in this Quarterly Report fairly presents, in all material respects, the financial condition and results of operation of the Company.