Lexaria Bioscience Corp 10-Q/A for FY2023 Q1

Lexaria Bioscience Corp. (LEXX)

10-Q/A 2023-01-18 For: 2022-11-30

Added on April 09, 2026

About this 10-Q/A

Lexaria Bioscience Corp filed this 10-Q/A on January 18, 2023, covering the quarter ended November 30, 2022 (FY2023 Q1).

Headline figures

Quarter ended November 30, 2022, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $101.48K; up 631.1% from $13.88K a year earlier
Net loss: $1.76M; compared with a net loss of $1.99M a year earlier

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Nevada		20-2000871
State or other jurisdiction of incorporation or organization		(I.R.S. Employer Identification No.)

#100 – 740 McCurdy Road, Kelowna BC Canada		V1X 2P7
(Address of principal executive offices)		(Zip Code)

Title of Class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, Par Value $0.001	LEXX	NASDAQ
Warrants	LEXXW	NASDAQ

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

PART I—FINANCIAL INFORMATION		3
Item 1.	Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3.	Controls and Procedures	25
PART II—OTHER INFORMATION		26
Item 1.	Legal Proceedings	26
Item 1A.	Risk Factors	26
Item 2.	Exhibits	26

LEXARIA BIOSCIENCE CORP.
CONSOLIDATED BALANCE SHEETS
(Expressed in U.S. Dollars)

	November 30,			August 31,
	2022			2022
ASSETS	(Unaudited)			(Audited)
Current
Cash	$	4,533,063		$	5,813,218
Marketable securities		269,707			347,335
Accounts receivable		286,322			201,784
Inventory		9,936			38,418
Prepaid expenses and deposit		260,342			576,761
Total Current Assets		5,359,370			6,977,516

Non-current assets, net
Right of use assets		42,340			52,444
Intellectual property		500,549			488,462
Property & equipment		311,221			315,505
Total Non-current Assets		854,110			856,411
TOTAL ASSETS	$	6,213,480		$	7,833,927

LIABILITIES
Current
Accounts payable and accrued liabilities	$	241,891		$	151,449
Lease payable		39,629			42,587
Total Current Liabilities		281,520			194,036

Long Term
Lease payable		-			7,401
Total Long Term Liabilities		-			7,401
TOTAL LIABILITIES		281,520			201,437

STOCKHOLDERS' EQUITY
Share Capital
Authorized:
220,000,000 common voting shares with a par value of $0.001 per share Issued and outstanding: 5,950,998 common shares at November 30, 2022 and at August 31, 2022		5,951			5,951
Additional paid-in capital		47,110,257			47,041,481
Deficit		(40,854,472	)		(39,098,528	)
Equity attributable to shareholders of the Company		6,261,736			7,948,904
Non-controlling Interest		(329,776	)		(316,414	)
Total Stockholders' Equity		5,931,960			7,632,490
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	6,213,480		$	7,833,927

LEXARIA BIOSCIENCE CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Expressed in U.S. Dollars, except number of shares)

	THREE MONTHS ENDED
	November 30,
	2022			2021
	(Unaudited)
Revenue	$	101,476		$	13,880
Cost of Goods Sold		15,795			5,570
Gross profit		85,681			8,310

Expenses
Research and development		829,489			458,709
Office and administration		1,025,498			1,553,083
		1,854,987			2,011,792

Net loss		(1,769,306	)		(2,003,482	)

Net loss for the period	$	(1,769,306	)	$	(2,003,482	)
Net loss attributable to:
Common shareholders	$	(1,755,944	)	$	(1,993,157	)
Non-controlling interest	$	(13,362	)	$	(10,325	)

Basic and diluted loss per share	$	(0.30	)	$	(0.35	)

Weighted average number of common shares outstanding
Basic and diluted		5,950,998			5,726,699

LEXARIA BIOSCIENCE CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Expressed in U.S. Dollars)

	THREE MONTHS ENDED
	November 30,
	2022			2021
	(Unaudited)
Cash flows used in operating activities
Net loss	$	(1,769,306	)	$	(2,003,482	)
Adjustments to reconcile net loss to
net cash used in operating activities:
Stock based compensation		68,776			408,544
Depreciation and amortization		24,730			27,930
Noncash right-of-use lease expense		10,104			9,385
Unrealized loss on marketable securities		77,628			340,417
Unrealized foreign exchange		-			(109	)
Lease accretion		845			1,562
Change in operating assets and liabilities
Accounts receivable		(84,538	)		(119,111	)
Inventory		30,791			2,914
Prepaid expenses and deposits		316,419			82,030
Accounts payable and accrued liabilities		90,442			88,819
Due to related parties		-			(5,223	)
Net cash used in by operating activities	$	(1,234,109	)	$	(1,166,324	)

Cash flows used in investing activities
Purchase of equipment		(20,500	)		(42,375	)
Intellectual property		(14,342	)		(15,840	)
Net cash used in investing activities	$	(34,842	)	$	(58,215	)

Cash flows from financing activities
Lease Payments		(11,204	)		(10,987	)
Net cash used in financing activities	$	(11,204	)	$	(10,987	)

Net change in cash for the period		(1,280,155	)		(1,235,526	)
Cash at beginning of period		5,813,218			10,917,797
Cash at end of period	$	4,533,063		$	9,682,271

Supplemental information of cash flows:
Income taxes paid in cash	$	-		$	-

					ADDITIONAL								TOTAL
	COMMON STOCK				PAID-IN								STOCKHOLDERS'
	SHARES		AMOUNT		CAPITAL		DEFICIT			NCI			EQUITY
			$		$		$			$			$
Balance August 31, 2021		5,726,699		5,727		45,089,114		(31,829,204	)		(202,085	)		13,063,552
Stock based compensation		-		-		408,544		-			-			408,544
Net loss		-		-		-		(1,993,157	)		-			(1,993,157	)
Non-controlling interest		-		-		-		-			(10,325	)		(10,325	)
Balance November 30, 2021		5,726,699		5,727		45,497,658		(33,822,361	)		(212,410	)		11,468,614
Balance August 31, 2022		5,950,998		5,951		47,041,481		(39,098,528	)		(316,414	)		7,632,490
Stock based compensation		-		-		68,776		-			-			68,776
Net loss		-		-		-		(1,755,944	)		-			(1,755,944	)
Non-controlling interest		-		-		-		-			(13,362	)		(13,362	)
Balance November 30, 2022		5,950,998		5,951		47,110,257		(40,854,472	)		(329,776	)		5,931,960

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

	Cost Basis $		Unrealized Gains $		Unrealized Losses $			Fair Value $
August 31, 2021		1,037,025		16,243		(219,427	)		833,841
Common stock		278,107		118,196		(882,809	)		(486,506	)
August 31, 2022		1,315,132		134,439		(1,102,236	)		347,335
Common stock		-		-		(77,628	)		(77,628	)
November 30, 2022		1,315,132		134,439		(1,179,864	)		269,707

Issued Patent #	Patent Certificate Grant Date	Patent Family
US 9,474,725 B1	10/25/2016	Food and Beverage Compositions Infused With Lipophilic Active Agents and Methods of Use Thereof
US 9,839,612 B2	12/12/2017
US 9,972,680 B2	05/15/2018
US 9,974,739 B2	05/22/2018
US 10,084,044 B2	09/25/2018
US 10,103,225 B2	10/16/2018
US 10,381,440	08/13/2019
US 10,374,036	08/06/2019
US 10,756,180	08/25/2020
US 11,311,559	04/26/2022	Compositions and Methods for Enhanced Delivery of Antiviral Agents

Three Months Ended November 30, 2022	Cost		Period Amortization			Additions		Accumulated Amortization			Net Balance November 30, 2022
	$		$			$		$			$
Leasehold improvements		259,981		(13,509	)		-		(208,195	)		51,786
Computers		70,781		(1,183	)		-		(62,607	)		8,174
Furniture fixtures & equipment		31,126		(1,604	)		-		(24,442	)		6,684
Lab equipment		333,675		(8,616	)		20,500		(109,598	)		244,577
		695,563		(24,912	)		20,500		(404,842	)		311,221

Year Ended August 31, 2022	Cost		Period Amortization			Disposal		Accumulated Amortization			Net Balance August 31, 2022
	$		$			$		$			$
Leasehold improvements		259,981		(54,037	)		-		(194,685	)		65,296
Computers		63,964		(9,874	)		6,817		(61,424	)		9,357
Furniture fixtures & equipment		31,126		(6,417	)		-		(22,837	)		8,288
Lab equipment		291,235		(31,572	)		42,375		(101,047	)		232,564
		646,306		(101,900	)		49,192		(379,993	)		315,505

Three Months Ended	November 30, 2022		November 30, 2021
	$		$
B2B sales		29,100		7,000
Licensing		63,435		-
Other		8,941		6,880

Total		101,476		13,880

	Number of Warrants			Weighted Average Exercise Price $
Balance August 31, 2022		2,421,983			8.04
Cancelled/expired		(7,500	)		24.00
Balance November 30, 2022		2,414,483			7.99

# of Warrants		Weighted Average Remaining Contractual Life	Weighted Average Exercise Price $
	60,798	1.96-2.00 years		36.00
	317,190	2.43 years		10.50
	116,667	1.38-2.29 years		9.00
	200,000	1.38 years		7.00
	1,719,828	3.13 years		6.58
	2,414,483	2.78 years		7.99

	November 30,		August 31,
	2022		2022
	$		$
Trade and deposits		137,041		80,374
Territory license fees		100,683		37,248
Sales tax		48,598		84,162
		286,322		201,784

	November 30,		August 31,
	2022		2022
	$		$
Advertising & conferences		74,656		359,863
Legal fees		25,000		25,000
License, filing fees, dues		3,750		15,000
Office & insurance		60,901		80,863
Capital financing		96,035		96,035
		260,342		576,761

	November 30,			August 31,
	2022			2022
	$			$
Balance – beginning		488,462			364,623
Addition		14,342			131,448
Amortization		(2,255	)		(7,609	)
Balance – ending		500,549			488,462
Patents are amortized over their 20 year legal life.

Quantity		Exercise Price $		Life (Years)
	3,400		3.04		5
	41,200		1.96		5
	44,600		2.04		5

	November 30, 2022
Expected volatility	99%-105		%
Risk-free interest rate	3.30-4.12		%
Expected life	5 years
Dividend yield		0	%
Estimated fair value per option	$1.60 - $2.58

	November 30, 2022			August 31, 2022
	$			$
Right of use assets - operating leases		52,444			91,041
Amortization		(10,104	)		(38,597	)
Total lease assets		42,340			52,444

Liabilities:		49,989			89,393
Lease payments		(11,204	)		(44,600	)
Interest accretion		844			5,195
Total lease liabilities		39,629			49,988

Operating lease cost		52,444			52,444
Operating cash flows for lease		11,204			44,599
Remaining lease term	0.9 Years			1.17 Years
Discount rate		7.25	%		7.25	%

Fiscal 2023	33,611
Fiscal 2024	7,470
Thereafter	-
Total lease payments	41,081
Less: imputed interest	(1,452	)
Present value of operating lease liabilities	39,629
Less: current obligations under leases	(39,629	)
Total	-

Three Months Ended November 30, 2022	IP Licensing $			B2B $			Corporate $			Consolidated Total $
Revenue		63,435			29,100			8,941			101,476
Cost of goods sold		-			(15,795	)		-			(15,795	)
Operating expenses		(707,034	)		(10,992	)		(1,136,961	)		(1,854,987	)
Segment income (loss)		(643,599	)		2,313			(1,128,020	)		(1,769,306	)
Total assets		118,096			75,723			6,019,661			6,213,480

Three Months Ended November 30, 2021	IP Licensing $			Products $			Corporate $			Consolidated Total $
External revenue		-			7,000			6,880			13,880
Cost of goods sold		-			(5,570	)		-			(5,570	)
Operating expenses		(837,750	)		(77,002	)		(1,097,040	)		(2,011,792	)
Segment loss		(837,750	)		(75,572	)		(1,090,160	)		(2,003,482	)

Total assets		724,665			116,060			10,905,217			11,745,942

Capital Asset by Region	Cost US		Addition US		Net Balance US		Cost Canada		Net Balance Canada		Total Net Balance
Three Months Ended November 30, 2022	$		$		$		$		$		$
Leasehold Improvements		-		-		-		259,981		51,786		51,786
Computers		-		-		-		70,781		8,174		8,174
Furniture & Fixtures		-		-		-		31,126		6,684		6,684
Lab Equipment		140,487		20,500		116,553		193,185		128,024		244,577
		140,487		20,500		116,553		555,073		194,668		311,221

Working Capital	November 30,			August 31,
	2022			2022
	$			$
Current assets		5,359,370			6,977,516
Current liabilities		(281,520	)		(194,036	)
Net Working Capital		5,077,850			6,783,480

Cash Flows	November 30,
	2022			2021
	$			$
Cash flows used in operating activities		(1,234,109	)		(1,166,324	)
Cash flows used in investing activities		(34,842	)		(58,215	)
Cash flows used in financing activities		(11,204	)		(10,987	)
Decrease in cash		(1,280,155	)		(1,235,526	)

a)	Financial Statements

	1)	Financial statements for our Company are listed in the index under Item 1 of this document

	2)	All financial statement schedules are omitted because they are not applicable, not material or the required information is shown in the financial statements or notes thereto.

Exhibit Number		Description
(31)		Rule 13(a) - 14 (a)/15(d) - 14(a)
31.1		Section 302 Certifications under Sarbanes-Oxley Act of 2002 of Principal Executive Officer
31.2		Section 302 Certifications under Sarbanes-Oxley Act of 2002 of Principal Financial Officer and Principal Accounting Officer
(32)		Section 1350 Certifications
32.1		Section 906 Certification under Sarbanes Oxley Act of 2002 of Principal Executive Officer
32.2		Section 906 Certification under Sarbanes Oxley Act of 2002 of Principal Financial Officer and Principal Accounting Officer

(101)*		Interactive Data Files
101.INS		XBRL Instance Document
101.SCH		XBRL Taxonomy Extension Schema Document
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		XBRL Taxonomy Extension Label Linkbase Document
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

By:	/s/ Christopher Bunka
	Christopher Bunka
	Chief Executive Officer, Chairman and Director
	(Principal Executive Officer)
	Date: January 18, 2023

By:	/s/ John Docherty
	John Docherty
	President and Director
	Date: January 18, 2023

By:	/s/ Greg Downey
	Greg Downey CPA, CMA
	Chief Financial Officer
	(Principal Financial and Accounting Officer)
	Date: January 18, 2023

1.	I have reviewed this Quarterly Report on Form 10-Q of Lexaria Bioscience 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.	The registrant’s other certifying officer and I are 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 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 disclosure 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 control over financial reporting, or caused such internal control over financial reporting 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 registrant’s most recent fiscal quarter (the registrant’s first fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

	a.	All significant deficiencies and material weaknesses in the design or operation of internal control 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.

/s/ Chris Bunka
Chris Bunka
CEO and Director
(Principal Executive Officer)

/s/ Gregory Downey
Gregory Downey CPA, CMA
Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer)

(1)	the Quarterly Report on Form 10-Q of Lexaria Bioscience Corp. for the quarter ended November 30, 2022 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)	the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Lexaria Bioscience Corp.