Propanc Biopharma, Inc 10-Q for FY2024 Q3

Propanc Biopharma, Inc. (PPCB)

10-Q 2024-05-15 For: 2024-03-31

Added on April 07, 2026

About this 10-Q

Propanc Biopharma, Inc filed this 10-Q on May 15, 2024, covering the quarter ended March 31, 2024 (FY2024 Q3).

Headline figures

Quarter ended March 31, 2024, as reported in this filing, compared with the same period a year earlier where the filing states it.

Net loss: $526.7K; compared with a net loss of $809.81K a year earlier
Diluted EPS: -$0.01; compared with -$0.42 a year earlier

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Title of each class		Trading Symbol(s)		Name of each exchange on which registered
None		None		None

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

		Page
PART I – FINANCIAL INFORMATION

Item 1.	Financial Statements	F-1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	8
Item 4.	Controls and Procedures	8

PART II – OTHER INFORMATION

Item 1.	Legal Proceedings	9
Item 1A.	Risk Factors	9
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	9
Item 3.	Defaults Upon Senior Securities	9
Item 4.	Mine Safety Disclosures	10
Item 5.	Other Information	10
Item 6.	Exhibits	10
	Signatures	11

	Page
Condensed Consolidated Balance Sheets at March 31, 2024 (unaudited) and June 30, 2023	F-2

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the three and nine months ended March 31, 2024 and 2023 (unaudited)	F-3

Condensed Consolidated Statements of Changes in Stockholders’ Deficit for each of the three and nine months in the periods ended March 31, 2024 and 2023 (unaudited)	F-4

Condensed Consolidated Statements of Cash Flows for the nine months ended March 31, 2024 and 2023 (unaudited)	F-5

Notes to the Condensed Consolidated Financial Statements (unaudited)	F-6

	March 31, 2024			June 30, 2023
	(Unaudited)
ASSETS

CURRENT ASSETS:
Cash	$	6,222		$	10,047
GST tax receivable		5,265			2,867
Prepaid expenses and other current assets		1,368			6,125

TOTAL CURRENT ASSETS		12,855			19,039

Security deposit - related party		1,955			1,999
Operating lease right-of-use assets, net - related party		22,527			38,988
Property and equipment, net		-			302

TOTAL ASSETS	$	37,337		$	60,328

LIABILITIES AND STOCKHOLDERS’ DEFICIT

CURRENT LIABILITIES:
Accounts payable	$	1,187,714		$	966,718
Accrued expenses and other payables		765,828			579,707
Accrued interest		83,310			44,709
Loan payable		65,280			65,280
Loans payable - related party		32,616			-
Loans payable		32,616			-
Note payable, net of discount		132,000			-
Convertible notes, net of discounts and including put premiums		582,951			390,539
Operating lease liability - related party, current portion		22,323			21,505
Embedded conversion option liabilities		128,432			423,209
Due to former director - related party		28,972			29,630
Loan from former director - related party		48,218			49,314
Employee benefit liability		610,340			587,618

TOTAL CURRENT LIABILITIES		3,687,984			3,158,229

NON-CURRENT LIABILITIES:
Loan payable - long-term - related party, net of discount		46,928			-
Operating lease liability - long-term portion - related party		1,942			19,278

TOTAL NON-CURRENT LIABILITIES		48,870			19,278

TOTAL LIABILITIES	$	3,736,854		$	3,177,507

Commitments and Contingencies (See Note 8)		-			-

STOCKHOLDERS’ DEFICIT:
Preferred stock, 1,500,005 shares authorized, $0.01 par value:
Series A preferred stock, $0.01 par value; 500,000 shares previously authorized; 0 shares issued and outstanding as of March 31, 2024 and June 30, 2023	$	-		$	-
Series B preferred stock, $0.01 par value; 5 shares authorized; 1 share issued and outstanding as of March 31, 2024 and June 30, 2023		-			-
Preferred stock, value		-			-
Common stock, $0.001 par value; 10,000,000,000 shares authorized; 109,706,411 and 6,031,250 shares issued and outstanding as of March 31, 2024 and June 30, 2023, respectively		109,706			6,031
Common stock issuable (0 and 1,621,653 shares as of March 31, 2024 and June 30, 2023, respectively)		-			1,621
Additional paid-in capital		61,237,446			60,311,502
Accumulated other comprehensive income		1,339,450			1,294,876
Accumulated deficit		(66,339,642	)		(64,684,732	)
Treasury stock ($0.001 share)		(46,477	)		(46,477	)

TOTAL STOCKHOLDERS’ DEFICIT		(3,699,517	)		(3,117,179	)

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	37,337		$	60,328

	2024			2023			2024			2023
	For the three months ended March 31,						For the nine months ended March 31,
	2024			2023			2024			2023

REVENUE
Revenue	$	-		$	-		$	-		$	-

OPERATING EXPENSES
Administration expenses		348,841			311,824			1,060,854			1,302,576
Occupancy expenses - related party		6,578			8,365			19,584			22,244
Research and development		65,448			66,020			195,712			242,223
TOTAL OPERATING EXPENSES		420,867			386,209			1,276,150			1,567,043

LOSS FROM OPERATIONS		(420,867	)		(386,209	)		(1,276,150	)		(1,567,043	)

OTHER INCOME (EXPENSE)
Interest expense		(133,141	)		(157,208	)		(575,837	)		(418,579	)
Interest income		27			8			60			27
Derivative expense		-			-			(123,379	)		-
Change in fair value of derivative liabilities		70,213			(238,367	)		372,371			(110,859	)
Gain from settlement of accounts payable		-			-			-			17,499
Gain (loss) on extinguishment of debt, net		(6,781	)		(10,724	)		27,318			32,186
Foreign currency transaction gain (loss)		(36,426	)		(19,025	)		(15,228	)		3,210
TOTAL OTHER INCOME (EXPENSE), NET		(106,108	)		(425,316	)		(314,695	)		(476,516	)

LOSS BEFORE TAXES		(526,975	)		(811,525	)		(1,590,845	)		(2,043,559	)

Tax benefit		275			1,716			128,895			131,037

NET LOSS	$	(526,700	)	$	(809,809	)	$	(1,461,950	)	$	(1,912,522	)

Deemed Dividend		(15,800	)		-			(192,960	)		(408,557	)

NET LOSS AVAILABLE TO COMMON STOCKHOLDERS	$	(542,500	)	$	(809,809	)	$	(1,654,910	)	$	(2,321,079	)

BASIC AND DILUTED NET LOSS PER SHARE AVAILABLE TO COMMON STOCKHOLDERS	$	(0.01	)	$	(0.42	)	$	(0.05	)	$	(2.08	)

BASIC AND DILUTED WEIGHTED AVERAGE SHARES OUTSTANDING		59,639,618			1,924,074			31,378,516			1,115,848

NET LOSS AVAILABLE TO COMMON STOCKHOLDERS	$	(542,500	)	$	(809,809	)	$	(1,654,910	)	$	(2,321,079	)

OTHER COMPREHENSIVE INCOME (LOSS)
Unrealized foreign currency translation gain (loss)		105,380			40,614			44,574			59,198

TOTAL OTHER COMPREHENSIVE INCOME (LOSS)		105,380			40,614			44,574			59,198

TOTAL COMPREHENSIVE LOSS	$	(437,120	)	$	(769,195	)	$	(1,610,336	)	$	(2,261,881	)

	No. of Shares			Value			No. of Shares		Value		No. of Shares		Value		No. of Shares			Value			Paid-in Capital			Subscription Receivable			Accumulated Deficit			Comprehensive Income			Treasury Stock			Stockholders’ Deficit
	Preferred Stock														Common Stock															Accumulated
	Series A						Series B				Common Stock				Issuable						Additional									Other						Total
	No. of Shares			Value			No. of Shares		Value		No. of Shares		Value		No. of Shares			Value			Paid-in Capital			Subscription Receivable			Accumulated Deficit			Comprehensive Income			Treasury Stock			Stockholders’ Deficit


Balance at June 30, 2022		500,000		$	5,000			1	$	-		220,351	$	220		19,598		$	20		$	57,364,690		$	(23,758	)	$	(61,557,893	)	$	1,234,549		$	(46,477	)	$	(3,023,649	)

Issuance of common stock for cash		-			-			-		-		14,337		14		-			-			24,697			23,758			-			-			-			48,469

Issuance of common stock for conversion of convertible debt, conversion fee and accrued interest		-			-			-		-		264,493		264		-			-			456,675			-			-			-			-			456,939

Issuance of common stock for issuable shares		-			-			-		-		19,597		20		(19,598	)		(20	)		-			-			-			-			-			-

Issuance of common stock for exercise of warrants		-			-			-		-		1		-		1			-			100,000			-			-			-			-			100,000

Issuance of common stock for alternate cashless exercise of warrants		-			-			-		-		158,399		158		-			-			(158	)		-			-			-			-			-

Reclassification of put premium upon debt conversion		-			-			-		-		-		-		-			-			133,646			-			-			-			-			133,646

Stock based compensation in connection with stock warrant grant		-			-			-		-		-		-		-			-			2,408			-			-			-			-			2,408

Warrant grant for settlement of accounts payable		-			-			-		-		-		-		-			-			5,551			-			-			-			-			5,551

Foreign currency translation gain		-			-			-		-		-		-		-			-			-			-			-			126,396			-			126,396

Deemed dividend upon alternate cashless exercise of warrants		-			-			-		-		-		-		-			-			389,235			-			(389,235	)		-			-			-

Net loss for the three months ended September 30, 2022		-			-			-		-		-		-		-			-			-			-			(617,295	)		-			-			(617,295	)

Balance at September 30, 2022		500,000			5,000			1		-		677,178		677		1			-			58,476,743			-			(62,564,423	)		1,360,945			(46,477	)		(2,767,535	)

Issuance of common stock for conversion of convertible debt, conversion fee and accrued interest		-			-			-		-		380,506		381		-			-			165,310			-			-			-			-			165,691

Issuance of common stock for issuable shares		-			-			-		-		1		-		(1	)		-			-			-			-			-			-			-

Issuance of common stock for exercise of warrants		-			-			-		-		3		-		-			-			100,000			-			-			-			-			100,000

Issuance of common stock for alternate cashless exercise of warrants		-			-			-		-		33,600		34		-			-			(34	)		-			-			-			-			-

Issuance of common stock for services		-			-			-		-		79,412		79		-			-			56,732			-			-			-			-			56,811

Issuance of common stock in connection with a note payable		-			-			-		-		75,000		75		-			-			37,425			-			-			-			-			37,500

Reclassification of put premium upon debt conversion		-			-			-		-		-		-		-			-			85,346			-			-			-			-			85,346

Foreign currency translation loss		-			-			-		-		-		-		-			-			-			-			-			(107,812	)		-			(107,812	)

Deemed dividend upon alternate cashless exercise of warrants		-			-			-		-		-		-		-			-			19,322			-			(19,322	)		-			-			-

Net loss for the three months ended December 31, 2022		-			-			-		-		-		-		-			-			-			-			(485,418	)		-			-			(485,418	)

Balance at December 31, 2022		500,000			5,000			1		-		1,245,699		1,246		-			-			58,940,845			-			(63,069,163	)		1,253,133			(46,477	)		(2,915,417	)

Issuance of common stock for conversion of convertible debt and accrued interest		-			-			-		-		1,375,598		1,376		-			-			433,822			-			-			-			-			435,198

Issuance of common stock for exercise of warrants		-			-			-		-		-				4			-			175,000			-			-			-			-			175,000

Reclassification of put premium upon debt conversion		-			-			-		-		-		-		-			-			133,000			-			-			-			-			133,000

Retirement of Series A Preferred Stock		(500,000	)		(5,000	)		-		-		-		-		-			-			5,000			-			-			-			-			-

Foreign currency translation loss		-			-			-		-		-		-		-			-			-			-			-			40,614			-			40,614

Net loss for the three months ended March 31, 2023		-			-			-		-		-		-		-			-			-			-			(809,809	)		-			-			(809,809	)

Balance at March 31, 2023		-		$	-			1	$	-		2,621,298	$	2,621		4		$	-		$	59,687,667		$	-		$	(63,878,972	)	$	1,293,747		$	(46,477	)	$	(2,941,414	)

	March 31, 2024		June 30, 2023
Exchange rate on balance sheet dates
USD : AUD exchange rate		0.6516		0.6664

Average exchange rate for the period
USD : AUD exchange rate		0.6545		0.6732

	Foreign Currency Items:
Balance, June 30, 2023	$	1,294,876
Unrealized foreign currency translation loss		44,574
Ending balance, March 31, 2024	$	1,339,450

	March 31, 2024		March 31, 2023
	(Unaudited)		(Unaudited)
Stock Options		0.06		0.06
Stock Warrants with no designations		15,003,396		3,306
Series A Warrants as if converted at alternate cashless exercise price		1,990,353,990		1,997,190
Series B Warrants		16		19
Series C Warrants as if converted at alternate cashless exercise price *		9,175,999,954		8,874,956
Unvested restricted stock		0.06		0.06
Convertible Debt		230,684,592		529,536
Total		11,412,041,948.12		11,405,007.12

				Weighted
	Number of			Average
	Shares			Price Per Share
Outstanding at June 30, 2023		3,396		$	5,440
Granted		15,000,000			0.01
Exercised (de minimis)		-			-
Forfeited		-			-
Expired		-			-
Outstanding at March 31, 2024		15,003,396	*	$	1.24

Exercisable at March 31, 2024		15,003,378		$	1.24
Outstanding and Exercisable:

Weighted average remaining contractual term		2.26
Aggregate intrinsic value	$	-

	Number of Warrants		Exercisable
Series A warrants		10		10
Series B warrants		17		17
Series C warrants		64		46
Warrants with no class designation		15,003,305		15,003,305
Total		15,003,396		15,003,378

			Weighted
	Number of		Average Exercise
	Shares		Price Per Share
Outstanding at June 30, 2023		0.059	$	4,533,000
Granted		-		-
Exercised		-		-
Forfeited		-		-
Expired		-		-
Outstanding at March 31, 2024		0.059	$	4,533,000

Exercisable at March 31, 2024		0.059	$	4,533,000
Outstanding and Exercisable:

Weighted average remaining contractual term		5.12
Weighted average fair value of options granted during the period	$	-
Aggregate intrinsic value	$	-

	March 31, 2024			June 30, 2023
Office lease	$	66,201		$	66,201
Less: accumulated amortization		(43,674	)		(27,213	)
Right-of-use asset, net	$	22,527		$	38,988


Fiscal Year 2024	$	5,864
Fiscal Year 2025		19,548
Imputed interest		(1,147	)
Total operating lease liability	$	24,265

Machinery and equipment	- 5 years
Furniture	- 7 years

	Initial Valuations (on new derivative instruments entered into during the nine months ended March 31, 2024)			March 31, 2024
Volatility		327.58 – 333.45	%		319.08	%
Expected Remaining Term (in years)		0.50			0.01 - 0.03
Risk Free Interest Rate		5.43 - 5.55	%		5.49	%
Expected dividend yield		None			None

	Balance at March 31, 2024		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
			(Level 1)		(Level 2)		(Level 3)
Embedded conversion option liabilities	$	128,432	$	—	$	—	$	128,432
Total	$	128,432	$	—	$	—	$	128,432

	Balance at June 30, 2023		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
			(Level 1)		(Level 2)		(Level 3)
Embedded conversion option liabilities	$	423,209	$	—	$	—	$	423,209
Total	$	423,209	$	—	$	—	$	423,209

	Fair Value of Liability for Derivative Instruments
Balance at June 30, 2023	$	423,209
Beginning balance	$	423,209
Initial fair value of embedded conversion option derivative liability recorded as debt discount		125,000
Initial fair value of embedded conversion option derivative liability recorded as derivative expense		123,379
Reduction of derivative liability upon debt conversion		(170,785	)
Change in fair value included in statements of operations		(372,371	)
Balance at March 31, 2024	$	128,432
Ending balance	$	128,432

	●	we do not have written documentation of our internal control policies and procedures. Written documentation of key internal controls over financial reporting is a requirement of Section 404 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”);

	●	we do not have sufficient segregation of duties within accounting functions, which is a basic internal control. Due to our limited size and early-stage nature of operations, segregation of all conflicting duties may not always be possible and may not be economically feasible; however, to the extent possible, the initiation of transactions, the custody of assets and the recording of transactions should be performed by separate individuals;

	●	lack of audit committee of our board of directors; and

Exhibit Number		Description

31.1*		Certification of Principal Executive Officer and Principal Financial Officer pursuant to Rule 13a-14a or 15d-14(a) under the Securities Exchange Act of 1934, as amended, and adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*		Certification of the Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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104*		Cover Page Interactive Data File - the cover page from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2024, is formatted in Inline XBRL.

	PROPANC BIOPHARMA, INC.

Dated: May 15, 2024	By:	/s/ James Nathanielsz
	Name:	James Nathanielsz
	Title:	Chief Executive Officer and Chief Financial Officer (Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer)

	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 for the period in which this quarterly 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;

	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 that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;

	a)	all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

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

Date: May 15, 2024	/s/ James Nathanielsz
	James Nathanielsz
	Chief Executive Officer and Chief Financial Officer (Principal Executive Officer and Principal Financial Officer)