10-Q
SCIENTIFIC INDUSTRIES INC (SCND)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
☒ QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2024
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________to________ Commission file number 0-6658
| SCIENTIFIC INDUSTRIES, INC. | |
|---|---|
| (Exact Name of Registrant as specified in Its Charter) | |
| Delaware | 04-2217279 |
| --- | --- |
| (State or other jurisdiction of<br><br>incorporation or organization) | (I.R.S. Employer<br><br>Identification No.) |
| 80 Orville Drive, Suite 102, Bohemia, New York | 11716 |
| (Address of principal executive offices) | (Zip Code) |
(631) 567-4700
(Registrant’s telephone number, including area code)
No t Applicable
(Former name, former address and former fiscal year, if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
|---|---|---|---|
| Non-accelerated Filer | ☒ | Smaller reporting company | ☒ |
| Emerging Growth company | ☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act) Yes ☐ No ☒
The number of shares outstanding of the registrant’s common stock, par value $.05 per share (“Common Stock”) as of May 13, 2024 is 10,503,599 shares.
SCIENTIFIC INDUSTRIES, INC.
Table of Contents
| PART I - Financial Information | ||
|---|---|---|
| Item 1. | CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) | 3 |
| Condensed Consolidated Balance Sheets | 3 | |
| Condensed Consolidated Statements of Operations and Comprehensive Loss | 4 | |
| Condensed Consolidated Statements of Changes in Shareholders’ Equity | 5 | |
| Condensed Consolidated Statements of Cash Flows | 6 | |
| Notes to Unaudited Condensed Consolidated Financial Statements | 7 | |
| Item 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS | 14 |
| Item 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK | 16 |
| Item 4. | CONTROLS AND PROCEDURES | 16 |
| PART II - Other Information | ||
| Item 1. | Legal Proceedings | 17 |
| Item 1A. | Risk Factors | 17 |
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 17 |
| Item 3. | Defaults Upon Senior Securities | 17 |
| Item 4. | Mine Safety Disclosures | 17 |
| Item 5. | Other Information | 17 |
| Item 6. | Exhibits | 18 |
| SIGNATURE | 19 | |
| 2 | ||
| --- | ||
| Table of Contents |
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
SCIENTIFIC INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
| December 31, 2023 | |||||
|---|---|---|---|---|---|
| ASSETS | |||||
| Current assets: | |||||
| Cash and cash equivalents | 351,700 | $ | 796,100 | ||
| Investment securities | 4,404,800 | 4,928,700 | |||
| Trade accounts receivable, less allowance for doubtful accounts of 33,600 at March 31, 2024 and December 31, 2023 | 1,144,900 | 1,157,100 | |||
| Inventories | 4,868,200 | 4,883,900 | |||
| Income tax receivable | 161,400 | 161,400 | |||
| Prepaid expenses and other current assets | 468,800 | 413,500 | |||
| Total current assets | 11,399,800 | 12,340,700 | |||
| Property and equipment, net | 1,050,100 | 1,082,300 | |||
| Goodwill | 115,300 | 115,300 | |||
| Other intangible assets, net | 1,124,000 | 1,249,900 | |||
| Inventories | 607,000 | 609,000 | |||
| Operating lease right-of-use assets | 1,190,900 | 1,273,900 | |||
| Other assets | 59,400 | 59,400 | |||
| Total assets | 15,546,500 | $ | 16,730,500 | ||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||
| Current liabilities: | |||||
| Accounts payable | 767,400 | $ | 711,700 | ||
| Accrued expenses | 887,400 | 777,900 | |||
| Contract liabilities | 24,500 | 23,600 | |||
| Lease liabilities, current portion | 371,100 | 324,100 | |||
| Total current liabilities | 2,050,400 | 1,837,300 | |||
| Lease liabilities, less current portion | 877,000 | 1,007,800 | |||
| Total liabilities | 2,927,400 | 2,845,100 | |||
| Shareholders’ equity: | |||||
| Common stock, 0.05 par value; 30,000,000 shares authorized; 10,503,599 and 10,145,211, shares issued and 10,503,599 and 10,145,211, shares outstanding at March 31, 2024 and December 31, 2023 | 525,200 | 507,300 | |||
| Additional paid-in capital | 41,672,300 | 40,844,600 | |||
| Accumulated other comprehensive gain (loss) | (41,700 | ) | 18,600 | ||
| Accumulated deficit | (29,536,700 | ) | (27,485,100 | ) | |
| Total shareholders’ equity | 12,619,100 | 13,885,400 | |||
| Total liabilities and shareholders’ equity | 15,546,500 | $ | 16,730,500 |
All values are in US Dollars.
See notes to unaudited condensed consolidated financial statements.
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SCIENTIFIC INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (UNAUDITED)
| For the Three Months Ended March 31, | ||||||
|---|---|---|---|---|---|---|
| 2024 | 2023 | |||||
| Revenues | $ | 2,483,500 | $ | 2,805,400 | ||
| Cost of revenues | 1,442,700 | 1,467,400 | ||||
| Gross profit | 1,040,800 | 1,338,000 | ||||
| Operating expenses: | ||||||
| General and administrative | 1,521,800 | 1,569,300 | ||||
| Selling | 897,800 | 1,444,800 | ||||
| Research and development | 710,700 | 791,500 | ||||
| Total operating expenses | 3,130,300 | 3,805,600 | ||||
| Loss from operations | (2,089,500 | ) | (2,467,600 | ) | ||
| Other income: | ||||||
| Other income (expense), net | (4,300 | ) | 86,300 | |||
| Interest income | 42,200 | 9,400 | ||||
| Total other income, net | 37,900 | 95,700 | ||||
| Loss from continuing operations before income tax benefit | (2,051,600 | ) | (2,371,900 | ) | ||
| Income tax expense | - | - | ||||
| Loss from continuing operations | (2,051,600 | ) | (2,371,900 | ) | ||
| Discontinued operations: | ||||||
| Gain from discontinued operations, net of tax | - | 1,400 | ||||
| Net loss | $ | (2,051,600 | ) | $ | (2,370,500 | ) |
| Comprehensive gain (loss): | ||||||
| Unrealized holding gain on investment securities, net of tax | - | 3,700 | ||||
| Foreign currency translation (loss) gain | (60,300 | ) | 40,200 | |||
| Comprehensive (loss) gain | (60,300 | ) | 43,900 | |||
| Total comprehensive loss | $ | (2,111,900 | ) | $ | (2,326,600 | ) |
| , | ||||||
| Basic and Diluted loss per common share | ||||||
| Continuing operations | $ | (0.20 | ) | $ | (0.34 | ) |
| Discontinued operations | $ | - | $ | - | ||
| Consolidated operations | $ | (0.20 | ) | $ | (0.34 | ) |
See notes to unaudited condensed consolidated financial statements.
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SCIENTIFIC INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (UNAUDITED)
| Accumulated | ||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Additional | Other | Total | ||||||||||||||||
| Common Stock | Paid-in | Comprehensive | Accumulated | Treasury Stock | Stockholders’ | |||||||||||||
| Shares | Amount | Capital | Income (Loss) | Deficit | Shares | Amount | Equity | |||||||||||
| Balance December 31, 2023 | 10,145,211 | $ | 507,300 | $ | 40,844,600 | $ | 18,600 | $ | (27,485,100 | ) | $ | 13,885,400 | ||||||
| Net loss | - | - | - | - | (2,051,600 | ) | - | (2,051,600 | ) | |||||||||
| Issuance of Common Stock and Warrants, net of issuance costs (Note 7) | 358,388 | 17,900 | 204,000 | - | - | - | 221,900 | |||||||||||
| Fair value modification of warrants recorded as stock issuance costs | - | - | 423,800 | - | - | - | 423,800 | |||||||||||
| Foreign currency translation adjustment | - | - | - | (60,300 | ) | - | - | (60,300 | ) | |||||||||
| Stock-based compensation | - | - | 199,900 | - | - | - | 199,900 | |||||||||||
| Balance March 31, 2024 | 10,503,599 | $ | 525,200 | $ | 41,672,300 | (41,700 | ) | $ | (29,536,700 | ) | - | $ | 12,619,100 | |||||
| Common Stock | Paid-in | Comprehensive | Accumulated | Treasury Stock | Stockholders’ | |||||||||||||
| Shares | Amount | Capital | Income (Loss) | Deficit | Shares | Amount | Equity | |||||||||||
| Balance December 31, 2022 | 7,023,401 | $ | 351,200 | $ | 32,900,800 | $ | (8,400 | ) | $ | (18,398,600 | ) | 19,802 | $ | 14,792,600 | ||||
| Net loss | - | - | - | - | (2,370,500 | ) | - | (2,370,500 | ) | |||||||||
| Foreign currency translation adjustment | - | - | - | 40,200 | - | - | 40,200 | |||||||||||
| Unrealized holding gain on investment securities, net of tax | - | - | - | 3,700 | - | - | 3,700 | |||||||||||
| Stock-based compensation | - | - | 602,600 | - | - | - | 602,600 | |||||||||||
| Balance March 31, 2023 | 7,023,401 | $ | 351,200 | $ | 33,503,400 | 35,500 | $ | (20,769,100 | ) | 19,802 | $ | 13,068,600 |
All values are in US Dollars.
See notes to unaudited condensed consolidated financial statements
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SCIENTIFIC INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
| For the Three Months Ended March 31, | ||||||
|---|---|---|---|---|---|---|
| 2024 | 2023 | |||||
| Operating activities: | ||||||
| Net loss | $ | (2,051,600 | ) | $ | (2,370,500 | ) |
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||
| Depreciation and amortization | 188,100 | 187,900 | ||||
| Stock-based compensation | 199,900 | 602,600 | ||||
| Provision for bad debt | 2,000 | - | ||||
| Loss on sale of investment securities | 1,400 | 69,200 | ||||
| Unrealized holding (gain) on investment securities | (5,600 | ) | (112,800 | ) | ||
| Carrying value of right of use assets | 82,500 | 75,500 | ||||
| Changes in operating assets and liabilities: | ||||||
| Trade accounts receivable | 9,600 | 143,200 | ||||
| Inventories | (19,500 | ) | (338,600 | ) | ||
| Prepaid and other current assets | (55,800 | ) | (27,100 | ) | ||
| Accrued expenses | 110,200 | 151,900 | ||||
| Contract liabilities | 900 | (119,500 | ) | |||
| Lease liabilities | (83,000 | ) | (77,500 | ) | ||
| Net cash used in operating activities | (1,565,100 | ) | (1,744,700 | ) | ||
| Investing activities: | ||||||
| Purchase of investment securities | (247,300 | ) | (791,800 | ) | ||
| Redemption of investment securities | 775,400 | 1,731,300 | ||||
| Capital expenditures | (47,500 | ) | (45,800 | ) | ||
| Net cash provided by investing activities | 480,600 | 893,700 | ||||
| Financing activities: | ||||||
| Proceeds from issuance of common stock | 716,800 | - | ||||
| Issuance costs of common stock and warrants | (71,100 | ) | - | |||
| Net cash provided by financing activities | 645,700 | - | ||||
| Effect of changes in foreign currency exchange rates on cash and cash equivalents | (5,600 | ) | 3,300 | |||
| Net decrease in cash and cash equivalents | (444,400 | ) | (847,700 | ) | ||
| Cash and cash equivalents, beginning of period | 796,100 | 1,927,100 | ||||
| Cash and cash equivalents, end of period | $ | 351,700 | $ | 1,079,400 |
See notes to unaudited condensed consolidated financial statements
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SCIENTIFIC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Nature of the Business and Basis of Presentation
Scientific Industries, Inc. and its subsidiaries (the “Company”) design, manufacture, and market a variety of benchtop laboratory equipment and bioprocessing products. The Company is headquartered in Bohemia, New York where it produces benchtop laboratory and pharmacy equipment. Additionally, the Company has a location in Baesweiller, Germany, where it designs and produces a variety of bioprocessing products, and administrative facilities in Orangeburg, New York and Pittsburgh, Pennsylvania related to sales and marketing. The products, which are sold to customers worldwide, include mixers, shakers, stirrers, refrigerated incubators, pharmacy balances and scales, force gauges, bioprocessing sensors and analytical tools.
The accompanying (a) unaudited condensed balance sheet as of December 31, 2023, which have been derived from audited financial statements, and (b) unaudited interim condensed consolidated financial statements are prepared pursuant to the Securities and Exchange Commission’s rules and regulations for reporting on Form 10-Q. Accordingly, certain information and notes required by accounting principles generally accepted in the United States for complete financial statements are not included herein. The Company believes all adjustments necessary for a fair presentation of these interim statements have been included and that they are of a normal and recurring nature. These interim statements should be read in conjunction with the Company’s consolidated financial statements and notes thereto, included in its Annual Report on Form 10-K for the fiscal year ended December 31, 2023. The results for the three months ended March 31, 2024 are not necessarily an indication of the results for the full fiscal year ending December 31, 2024.
2. Significant Accounting Policies
Principles of Consolidation
The accompanying unaudited interim condensed consolidated financial statements include the accounts of Scientific Industries, Inc., Scientific Bioprocessing Holdings, Inc. (“SBHI”), a Delaware corporation and wholly-owned subsidiary, which holds 100% of the outstanding stock of Scientific Bioprocessing, Inc. (“SBI”), a Delaware corporation, and aquila biolabs GmbH (“Aquila”), a German corporation, since its acquisition on April 29, 2021, Scientific Packaging Industries, Inc., an inactive wholly-owned subsidiary and Altamira Instruments, Inc. (“Altamira”), a Delaware corporation and wholly-owned subsidiary (discontinued operation as of November 30, 2020) (all collectively referred to as the “Company”). All material intercompany balances and transactions have been eliminated in consolidation.
Liquidity and Going Concern Considerations
The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) which contemplate continuation of the Company as a going concern. For the three months ended March 31, 2024, the Company generated negative cash flows from operations of $1,561,100 and has an accumulated deficit of $29,536,700 as of March 31, 2024.
In order to address these conditions, the Company has undertaken a number of strategic initiatives that management believes will provide sufficient funding to enable the Company to continue to operate as a going concern. During the three months ended March 31, 2024, the Company continued to eliminate certain operating expenses in conjunction with its review of the strategic operational and product development plan for the Bioprocessing Systems Operations segment. The Company identified expenses which the Company does not anticipate replacing or to be recurring in the Company’s operational plans for the foreseeable future, primarily in the form of reduced number of employees and related employment expenses. An additional $716,776 of equity financing was raised in January 2024 as disclosed in Note 7. Management is in plans to obtain such resources for the Company by obtaining capital through third party equity and/or debt financing. However, management cannot provide any assurances that the Company will be successful in accomplishing its plans.
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As a result of the above actions, as of May 15, 2024, the Company believes that it will be able to meet its cash flow needs during the next 12 months from cash and investment securities on-hand, cash derived from its Benchtop Laboratory Equipment Operations, and availability of the Company’s line of credit.
Accordingly, the financial statements do not include any adjustments relating to the recoverability of assets and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
Reclassifications
Certain balances from fiscal 2023 have been reclassified to conform to the current year presentation.
3. Fair Value of Financial Instruments
The Company follows ASC - Accounting Standards Codification (“ASC 820”), Fair Value Measurement, which has defined the fair value of financial instruments as the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements do not include transaction costs.
The accounting guidance also expands the disclosure requirements around fair value and establishes a fair value hierarchy for valuation inputs. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of the three levels, which is determined by the lowest level input that is significant to the fair value measurement in its entirety. These levels are described below:
Level 1 Inputs that are based upon unadjusted quoted prices for identical instruments traded in active markets.
Level 2 Quoted prices in markets that are not considered to be active or financial instruments for which all significant inputs are observable, either directly or indirectly.
Level 3 Prices or valuation that require inputs that are both significant to the fair value measurement and unobservable.
In valuing assets and liabilities, the Company is required to maximize the use of quoted market prices and minimize the use of unobservable inputs. The Company calculated the fair value of its Level 1 and 2 instruments based on the exchange traded price of similar or identical instruments where available or based on other observable instruments. These calculations take into consideration the credit risk of both the Company and its counterparties. The Company has not changed its valuation techniques in measuring the fair value of any financial assets and liabilities during the period.
The fair value of the contingent consideration obligations was based on a probability weighted approach derived from the estimates of earn-out criteria and the probability assessment with respect to the likelihood of achieving those criteria. The measurement is based on significant inputs that were not observable in the market, therefore, the Company classifies this liability as Level 3 in the following table.
The following tables set forth by level within the fair value hierarchy the Company’s financial assets that were accounted for at fair value on a recurring basis as of March 31, 2024 and December 31, 2023 according to the valuation techniques the Company used to determine their fair values:
| Fair Value Measurements as of March 31, 2024 | ||||||||
|---|---|---|---|---|---|---|---|---|
| Level 1 | Level 2 | Level 3 | Total | |||||
| Investment securities | $ | 4,404,800 | $ | - | $ | - | $ | 4,408,800 |
| Total | $ | 4,404,800 | $ | - | $ | - | $ | 4,408,800 |
| Fair Value Measurements as of December 31, 2023 | ||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||
| Investment securities | $ | 4,928,700 | $ | - | $ | - | $ | 4,928,700 |
| Total | $ | 4,928,700 | $ | - | $ | - | $ | 4,928,700 |
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Investments in marketable securities by security type as of March 31, 2024 and December 31, 2023 consisted of the following:
| As of March 31, 2024: | Cost | Fair Value | Unrealized Holding<br><br>Gain | ||||
|---|---|---|---|---|---|---|---|
| Mutual funds | $ | 4,401,300 | $ | 4,404,800 | $ | 3,500 | |
| Total | $ | 4,401,300 | 4,404,800 | $ | 3,500 | ||
| As of December 31, 2023: | Cost | Fair Value | Unrealized Holding<br><br>Gain<br><br>(Loss) | ||||
| Mutual funds | $ | 4,929,300 | $ | 4,928,700 | $ | (600 | ) |
| Total | $ | 4,929,300 | $ | 4,928,700 | $ | (600 | ) |
4. Inventories
| As of<br><br>March 31, | As of<br><br>December 31, | |||
|---|---|---|---|---|
| 2024 | 2023 | |||
| Raw materials | $ | 3,530,800 | $ | 3,436,300 |
| Work-in-process | 108,000 | 23,200 | ||
| Finished goods | 1,836,400 | 2,033,400 | ||
| Total Inventories | $ | 5,475,200 | $ | 5,492,900 |
| Inventories - Current Asset | $ | 4,868,200 | $ | 4,883,900 |
| Inventories - Noncurrent Asset | 607,000 | 609,000 |
5. Goodwill and Finite Lived Intangible Assets
Goodwill amounted to $115,300 as of March 31, 2024 and December 31, 2023.
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Finite lived intangible assets consist of the following:
| As of March 31, 2024: | Useful Lives | Cost | Accumulated<br><br>Amortization | Net | |||
|---|---|---|---|---|---|---|---|
| Technology, trademarks | 3-10 yrs. | $ | 1,216,800 | $ | 908,200 | $ | 308,600 |
| Trade names | 3-6 yrs. | 592,300 | 360,500 | 231,800 | |||
| Websites | 3-7 yrs. | 210,000 | 210,000 | - | |||
| Customer relationships | 4-10 yrs. | 372,200 | 200,500 | 171,700 | |||
| Sublicense agreements | 10 yrs. | 294,000 | 294,000 | - | |||
| Non-compete agreements | 4-5 yrs. | 1,060,500 | 846,500 | 21,400 | |||
| Patents | 5-7 yrs. | 596,900 | 399,000 | 197,900 | |||
| $ | 4,342,700 | $ | 3,218,700 | $ | 1,124,000 | ||
| As of December 31, 2023 | Useful Lives | Cost | Accumulated<br><br>Amortization | Net | |||
| --- | --- | --- | --- | --- | --- | --- | --- |
| Technology, trademarks | 3-10 yrs. | $ | 1,216,800 | $ | 870,900 | $ | 345,900 |
| Trade names | 3-6 yrs. | 592,300 | 341,600 | 250,700 | |||
| Websites | 3-7 yrs. | 210,000 | 210,000 | - | |||
| Customer relationships | 4-10 yrs. | 372,200 | 193,600 | 178,600 | |||
| Sublicense agreements | 10 yrs. | 294,000 | 294,000 | - | |||
| Non-compete agreements | 4-5 yrs. | 1,060,500 | 797,600 | 262,900 | |||
| Patents | 5-7 yrs. | 595,800 | 384,000 | 211,800 | |||
| $ | 4,341,600 | $ | 3,091,700 | $ | 1,249,900 |
Total amortization expense was $127,000 and $130,000 for the three months ended March 31, 2024 and 2023, respectively.
Estimated future fiscal year amortization expense of intangible assets as of March 31, 2024 is as follows:
| As of March 31, 2024 | Amount | |
|---|---|---|
| Remainder of fiscal year ending 2024 | $ | 382,800 |
| 2025 | 371,700 | |
| 2026 | 194,100 | |
| 2027 | 92,800 | |
| 2028 | 42,000 | |
| Thereafter | 40,600 | |
| Total | $ | 1,124,000 |
6. Commitment and Contingencies
Legal Matters
During the normal course of business, the Company may be named from time to time as a party to claims and litigations arising in the ordinary course of business. When the Company becomes aware of potential litigation, it evaluates the merits of the case in accordance with ASC 450, Contingencies. Litigation and contingency accruals are based on our assessment, including advice of legal counsel, regarding the expected outcome of litigation or other dispute resolution proceedings. If the Company determines that an unfavorable outcome is probable and can be reasonably assessed, it establishes the necessary accruals. As of March 31, 2024 and December 31, 2023, the Company is not aware of any contingent legal liabilities that should be reflected in the consolidated financial statements.
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Leases
The Company’s approximate future minimum rental payments under all operating leases as of March 31, 2024 were as follows:
| As of March 31, 2024: | Amount | ||
|---|---|---|---|
| Remainder of fiscal year ending 2024 | $ | 288,300 | |
| 2025 | 358,300 | ||
| 2026 | 266,600 | ||
| 2027 | 274,600 | ||
| 2028 | 201,000 | ||
| Total future minimum payments | $ | 1,388,800 | |
| Less: Imputed interest | (140,700 | ) | |
| Total Present Value of Operating Lease Liabilities | $ | 1,248,100 |
7. Stockholders’ Equity
Issuance of Common Stock and Warrants
On January 17, 2024, the Company completed the last closing of its sale of securities pursuant to the Securities Purchase Agreement (the “Purchase Agreement”) entered on December 13, 2023, as filed in the Company’s Form 8-K on December 15, 2023. At this closing, the Company sold an aggregate of 358,388 Units, comprising 358,388 shares of the Company’s common stock, par value $.05 per share (“Common Stock”) and warrants (“Warrants”) to purchase 358,388 shares of Common Stock for a total consideration of $716,776. The Company recognized $98,700 of issuance cost, which includes $71,100 attributable to legal and placement agent fees and $27,600 attributable to the fair value of warrants, issued to the placement agent, to purchase up to 17,919 shares of Common Stock at an exercise price of $2.00 per share on substantially the same terms as the Warrants issued to the Investors.
As an incentive to certain Investors of the Company who participated in previous private placements (“Existing Investors”) and received as part of those financings, warrants (“Outstanding Warrants”) to purchase shares of Common Stock, the Company agreed that, if any Existing Investor were to purchase Units at a certain level in the offering thereof under the Purchase Agreement (the “Offering”), the Company would reduce the exercise price of the Outstanding Warrants held by such Existing Investor to $2.50 per share and extend the period in which such Outstanding Warrants could be exercised to the fifth anniversary of the date on which the Existing Investor purchased Units under the Purchase Agreement. Each Existing Investor purchasing Units at the requisite level will receive a new warrant (the “Replacement Warrants”) to replace such Existing Investor’s Outstanding Warrants. On January 17, 2024, as a result of their purchase of Units, Existing Investors became entitled to receive Replacement Warrants to replace 333,884 Outstanding Warrants, and therefore reducing the exercise price of such Outstanding Warrants to $2.50 per share and extending the period in which such Outstanding Warrants could be exercised to the fifth anniversary of the relevant closing under the Purchase Agreement.
8. Loss Per Common Share
The Company presents the computation of earnings per share (“EPS”) on a basic basis. Basic EPS is computed by dividing net income or loss by the weighted average number of shares outstanding during the reported period. Diluted EPS is computed similarly to basic EPS, except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential additional common shares that were dilutive had been issued. Common shares are excluded from the calculation if they are determined to be anti-dilutive. The following table sets forth the weighted average number of common shares outstanding for each period presented.
| For the three months ended<br><br>March 31, | ||||||
|---|---|---|---|---|---|---|
| 2024 | 2023 | |||||
| Weighted average number of common shares outstanding | 10,436,647 | 7,003,599 | ||||
| Effect of dilutive securities: | - | - | ||||
| Weighted average number of dilutive common shares outstanding | 10,436,647 | 7,003,599 | ||||
| Basic and diluted loss per common share: | ||||||
| Continuing operations | $ | (0.20 | ) | $ | (0.34 | ) |
| Discontinued operations | - | - | ||||
| Consolidated operations | $ | (0.20 | ) | $ | (0.34 | ) |
| 11 | ||||||
| --- | ||||||
| Table of Contents |
Approximately 1,113,837 and 7,856,203 shares of the Company’s common stock issuable upon the exercise of stock options and warrants, respectively, were excluded from the calculation because the effect would be anti-dilutive due to the loss for the three months ended March 31, 2024.
Approximately 22,368 and 0 shares of the Company’s common stock issuable upon the exercise of stock options and warrants, respectively, were excluded from the calculation because the effect would be anti-dilutive due to the loss for the three months ended March 31, 2023.
9. Related Parties
Consulting Agreements
During the three months ended March 31, 2024 and 2023, respectively, the Company paid $16,000 and $0, respectively, to Mr. John Nicols, a Director of the Company, who provided consulting services to the Bioprocessing Systems segment.
10. Segment Information and Concentration
The Company views its operations as two operating segments: the manufacture and marketing of standard benchtop laboratory equipment for research in university, hospital and industrial laboratories sold primarily through laboratory equipment distributors and laboratory and pharmacy balances and scales (“Benchtop Laboratory Equipment Operations”), and the manufacture, design, and marketing of bioprocessing systems and products (“Bioprocessing Systems”). The Company also has included a non-operating Corporate segment. All inter-segment revenues are eliminated.
Segment information is reported as follows.
| Three Months Ended March 31, 2024: | Benchtop Laboratory Equipment | Bioprocessing Systems | Corporate And Other | Consolidated | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenues | $ | 2,167,400 | $ | 316,100 | $ | - | $ | 2,483,500 | |||
| Foreign Sales | 655,100 | 200,500 | 855,600 | ||||||||
| Income (Loss) From Operations | 72,800 | (1,601,800 | ) | (560,500 | ) | (2,089,500 | ) | ||||
| Assets | 6,283,100 | 4,858,600 | 4,404,800 | 15,546,500 | |||||||
| Long-Lived Asset Expenditures | 45,800 | 1,700 | - | 47,500 | |||||||
| Depreciation and Amortization | 21,400 | 166,700 | - | 188,100 | |||||||
| 12 | |||||||||||
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| Table of Contents | |||||||||||
| Three Months Ended March 31, 2023: | Benchtop Laboratory Equipment | Bioprocessing Systems | Corporate And Other | Consolidated | |||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Revenues | $ | 2,582,200 | $ | 223,200 | $ | - | $ | 2,805,400 | |||
| Foreign Sales | 856,600 | 95,900 | 952,500 | ||||||||
| Income (Loss) From Operations | 266,200 | (2,072,500 | ) | (661,300 | ) | (2,467,600 | ) | ||||
| Assets | 7,810,900 | 5,174,100 | 3,379,000 | 16,364,000 | |||||||
| Long-Lived Asset Expenditures | 8,200 | 37,600 | - | 45,800 | |||||||
| Depreciation and Amortization | 23,300 | 164,600 | - | 187,900 |
For the three months ended March 31, 2024 no customers accounted for approximately 10% or more of the Company’s total revenue. For the three months ended March 31, 2023 one customer accounted for approximately 10% or more of the Company’s total revenue
A reconciliation of the Company’s consolidated segment income (loss) from operations to consolidated loss from operations before income taxes and net loss for the three months ended March 31, 2024 and 2023, respectively are as follows:
| For the three months ended March 31, 2024 | Benchtop Laboratory Equipment | Bioprocessing Systems | Corporate | Consolidated | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Income (Loss) from Operations | $ | 72,800 | $ | (1,601,800 | ) | $ | (560,500 | ) | $ | (2,089,500 | ) | |
| Other income(expense), net | (9,800 | ) | 5,500 | - | (4,300 | ) | ||||||
| Interest income | 42,000 | - | - | 42,200 | ||||||||
| Total other income, net | 32,400 | 5,500 | - | 37,900 | ||||||||
| Income (Loss) from operations before discontinued operations and income taxes | $ | 105,200 | $ | (1,596,300 | ) | $ | (560,500 | ) | $ | (2,051,600 | ) | |
| For the three months ended March 31, 2023 | Benchtop Laboratory Equipment | Bioprocessing Systems | Corporate | Consolidated | ||||||||
| Income (Loss) from Operations | $ | 266,200 | $ | (2,072,500 | ) | $ | (661,300 | ) | $ | (2,467,600 | ) | |
| Other income (expense), net | (1,800 | ) | 11,000 | 77,100 | 86,300 | |||||||
| Interest income | - | - | 9,400 | 9,400 | ||||||||
| Total other (expense) income, net | (1,800 | ) | 11,000 | 86,500 | 95,700 | |||||||
| Income (Loss) from operations before discontinued operations and income taxes | $ | 264,400 | $ | (2,061,500 | ) | $ | (574,800 | ) | $ | (2,371,900 | ) | |
| 13 | ||||||||||||
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| Table of Contents |
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Forward-Looking statements. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our audited financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2023. Certain statements contained in this report are not based on historical facts, but are forward-looking statements that are based upon various assumptions about future conditions. Actual events in the future could differ materially from those described in the forward-looking statements. Numerous unknown factors and future events could cause such differences, including but not limited to, product demand, market acceptance, success of marketing strategy, success of expansion efforts, impact of competition, adverse economic conditions, and other factors affecting the Company’s business that are beyond the Company’s control, which are discussed elsewhere in this report. Consequently, no forward-looking statement can be guaranteed. The Company undertakes no obligation to publicly update forward-looking statements, whether as a result of new information, future events or otherwise. Throughout this Quarterly Report on Form 10-Q, the terms the “Company,” “Scientific,” “we,” “our” or “us,” refer to Scientific Industries, Inc. and its subsidiaries on a consolidated basis, unless stated or the context implies otherwise.
Overview.
Scientific Industries, Inc., a Delaware corporation (“SI” and along with its subsidiaries, the “Company”, “we”, “our”), is engaged in the design, manufacture, and marketing of standard benchtop laboratory equipment (“Benchtop Laboratory Equipment”), and through its wholly-owned subsidiary, Scientific Bioprocessing Holdings, Inc., a Delaware corporation (“SBHI”), the design, manufacture, and marketing of bioprocessing systems and products (“Bioprocessing Systems”). SBHI has two wholly-owned subsidiaries – Scientific Bioprocessing, Inc., a Delaware corporation (“SBI”), and aquila biolabs GmbH, a German corporation (“Aquila”). The Company’s products are used primarily for research purposes by universities, pharmaceutical companies, pharmacies, national laboratories, medical device manufacturers, and other industries performing laboratory-scale research.
Results of Operations.
The Company’s results reflect those of the Benchtop Laboratory Equipment Operations and the Bioprocessing Systems Operations and its corporate operation. The Company realized a loss from continuing operations of $2,051,600 for the three months ended March 31, 2024 compared to a $2,371,900 loss from continuing operations for the three months ended March 31, 2023, primarily due to increased revenue in the Bioprocessing Systems Operations segment along with a decrease in noncash stock compensation expense, and decreased Corporate expenses compared to the prior year period,
Revenue
Net revenues for the three months ended March 31, 2024 decreased $321,900 (11.5%) to $2,483,500 from $2,805,400 for the three months ended March 31, 2023, driven primarily by lower revenues of Benchtop Laboratory Equipment Operations of $414,800, due primarily to decreased orders for Torbal products in part due to unavailability of product due to extensive ocean shipping delays, partially offset by an increase of $92,900 (41%) in revenues of the Bioprocessing Systems Operations related to the Company’s Aquila legacy products.
Gross profit
The gross profit percentage for the three months ended March 31, 2024 and 2023, was 41.9% and 47.7%, respectively. The 5.8% decrease is due primarily to lower gross margin percentage in the Benchtop Laboratory Equipment Operations, resulting from increases in material, labor and overhead costs.
General and administrative
General and administrative expenses for the three months ended March 31, 2024 and 2023, were $1,521,800 and $1,569,300, respectively. The decrease of $47,500 (3.0%) is due primarily to decreased Corporate expenses related to stock-based compensation costs compared to prior year period, partially offset by employee related costs associated with a reduction in force in the Bioprocessing Systems Operations.
Selling
Selling expenses for the three months ended March 31, 2024 and 2023, were $897,800 and $1,444,800 , respectively. The decrease of $547,000 (37.9%) is due primarily to the reduction of sales and marketing employees and decreased non-cash stock-based compensation expenses in the Bioprocessing Systems Operations, and to a lower extent reductions in marketing activities by the Benchtop Laboratory Equipment Operations compared to prior year period.
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Research and development
Research and development expenses for the three months ended March 31, 2024, and 2023, were $710,700 and $791,500, respectively. The decrease of $80,800 (10.2%) is due primarily to the reduction of research and development expenditures related to the VIVID automated pill counter in the Benchtop Laboratory Equipment Operations as compared to prior year period.
Other income, net
Other income, net, for the three months ended March 31, 2024 and 2023, were $37,900 and $95,700, respectively. The decrease is due primarily to the decrease in unrealized gain and interest income on investment securities, and a decrease in realized loss on investment securities during the current year period as compared to prior year period.
Income tax
Income tax for the three months ended March 31, 2024, and 2023, was $0 and $0, respectively. The Company maintains a full valuation allowance of $10,041,400 against the consolidated net deferred tax asset as the Company determined the net deferred tax assets which includes net operating loss carry-forwards and other tax credits, are not more likely than not to be realized in the future.
Liquidity and Capital Resources.
Our primary sources of liquidity are existing cash and cash equivalents, and cash generated from operating activities of the Benchtop Laboratory Equipment Operations. We assess our liquidity in terms of our ability to generate cash to fund our short and long-term cash requirements. For the three months ended March 31, 2024, the Company generated negative cash flows from operations of $2,051,600 and has an accumulated deficit of $29,536,700 as of March 31, 2024.
In order to address these conditions, the Company has undertaken a number of strategic initiatives that management believes will provide sufficient funding to enable the Company to continue to operate as a going concern. During the three months ended March 31, 2024, the Company continued to eliminate certain operating expenses in conjunction with its review of the strategic operational and product development plan for the Bioprocessing Systems Operations segment. The Company identified expenses which the Company does not anticipate replacing or to be recurring in the Company’s operational plans for the foreseeable future, primarily in the form of reduced number of employees and related employment expenses. An additional $716,776 of equity financing was raised in January 2024 as disclosed in Note 7. Management is in plans to obtain such resources for the Company by obtaining capital through third party equity. However, management cannot provide any assurances that the Company will be successful in accomplishing its plans.
As a result of the above actions, the Company believes that it will be able to meet its cash flow needs during the next 12 months from cash and investment securities on-hand, cash derived from its Benchtop Laboratory Equipment Operations, and availability of the Company’s line of credit.
The following table discloses our cash flows for the periods presented:
| For the three months ended March 31, | ||||||
|---|---|---|---|---|---|---|
| 2024 | 2023 | |||||
| Net cash used in operating activities | $ | (1,565,100 | ) | $ | (1,744,700 | ) |
| Net cash provided by investing activities | 480,600 | 893,700 | ||||
| Net cash provided by financing activities | 645,700 | - | ||||
| Effect of changes in foreign currency exchange rates | (5,600 | ) | 3,300 | |||
| Decrease in cash and cash equivalents | $ | (444,400 | ) | $ | (847,700 | ) |
| 15 | ||||||
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| Table of Contents |
Net cash used in operating activities was $1,565,100 for the three months ended March 31, 2024 compared to $1,744,700 for the three months ended March 31, 2023. The net decrease of $179,600 is primarily due to the decreased operational costs from the Bioprocessing Systems operations in the current period.
Net cash provided by investing activities was $480,600 for the three months ended March 31, 2024 compared to $893,700 provided in the three months ended March 31, 2023. The net decrease of $413,10 is primarily due to the net decrease in net redemption of purchase of investment securities, in the current year period compared to prior year period.
Net cash provided by financing activities was $645,700 for the three months ended March 31, 2024 compared to $0 for the three months ended March 31, 2023. The net increase of $645,700, is primarily due to issuance of common stock in the current year period.
Critical Accounting Estimates
The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires us to make judgments, assumptions, and estimates that affect the amounts reported in the consolidated financial statements and accompanying notes. “Note 2-Summary of significant accounting policies” to the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2023 (“2023 Form 10-K”) describes the significant accounting policies and methods used in the preparation of the consolidated financial statements. Our critical accounting estimates are identified in Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II, Item 7 of our 2023 Form 10-K. Such accounting policies and estimates require significant judgments and assumptions to be used in the preparation of the consolidated financial statements, and actual results could differ from our assumptions and estimates, and such differences could be material.
ITEM 3. Quantitative and Qualitative Disclosures about Market Risk
We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.
ITEM 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
As of the end of the period covered by this report, our management, with the participation and supervision of our Chief Executive Officer and Chief Financial Officer, have evaluated the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934). In designing and evaluating our disclosure controls and procedures, we recognize that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives and that we are required to apply our judgment in evaluating the cost-benefit relationship of possible controls and procedures. Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected. Based on the evaluation of our disclosure controls and procedures and internal controls over financial reporting as of March 31, 2024, our Chief Executive Officer and our Chief Financial Officer concluded that our disclosure controls and procedures were effective. Our management has concluded that the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q present fairly, in all material respects, the Company’s financial position, results of operations and cash flows for the periods disclosed in accordance with U.S. GAAP.
Changes in Internal Controls Over Financial Reporting
There were no changes in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the three months ended March 31, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
| 16 |
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| Table of Contents |
PART II – OTHER INFORMATION
ITEM 1. Legal Proceedings
None
ITEM 1A. Risk Factors
Not required for smaller reporting companies.
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds
Refer to Current Report on Form 8-K filed with the SEC on January 22, 2024 as incorporated by reference for recent sales of unregistered securities.
ITEM 3. Defaults Upon Senior Securities
None
ITEM 4. Mine Safety Disclosures
Not applicable
ITEM 5. Other Information
None
| 17 |
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ITEM 6. Exhibits
SIGNATURES
Pursuant to the requirements of Section13 or 15(d) of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| SCIENTIFIC INDUSTRIES, INC. (Registrant) | ||
|---|---|---|
| Date: May 15, 2024 | By: | /s/ Helena R. Santos |
| Helena R. Santos | ||
| President, Chief Executive Officer, and Treasurer | ||
| SCIENTIFIC INDUSTRIES, INC. (Registrant) | ||
| --- | --- | --- |
| Date: May 15, 2024 | By: | /s/ Reginald Averilla |
| Reginald Averilla | ||
| Chief Financial Officer | ||
| 19 | ||
| --- |
scnd_ex311.htm EXHIBIT 31.1
CERTIFICATION BY THE CHIEF EXECUTIVE OFFICER
PURSUANT TO SECTION 302
OF THE SARBANES-OXLEY ACT
I, Helena R. Santos, certify that:
| 1. | I have reviewed this Quarterly Report on Form 10-Q for the quarter ended March 31, 2024 of Scientific Industries, Inc.; | |
|---|---|---|
| 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 Securities 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 my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me 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 my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purpose in accordance with generally accepted accounting principles; | |
| c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures, and presented in this report my 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 fourth fiscal quarter) that has materially affected, or is reasonable likely to materially affect, the registrant’s internal control over financial reporting; and | |
| 5. | I have disclosed, based on my 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. |
| Scientific Industries, Inc. | ||
|---|---|---|
| Date: May 15, 2024 | By: | /s/ Helena R. Santos |
| | | Helena R. Santos |
| | | Chief Executive Officer |
scnd_ex312.htm EXHIBIT 31.2
CERTIFICATION BY THE CHIEF FINANCIAL OFFICER
PURSUANT TO SECTION 302
OF THE SARBANES-OXLEY ACT
I, Reginald Averilla, certify that:
| 1. | I have reviewed this Quarterly Report on Form 10-Q for the quarter ended March 31, 2024 of Scientific Industries, Inc.; | |
|---|---|---|
| 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 Securities 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 my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me 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 my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purpose in accordance with generally accepted accounting principles; | |
| c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures, and presented in this report my 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 fourth fiscal quarter) that has materially affected, or is reasonable likely to materially affect, the registrant’s internal control over financial reporting; and | |
| 5. | I have disclosed, based on my 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. |
| Scientific Industries, Inc. | ||
|---|---|---|
| Date: May 15, 2024 | By: | /s/ Reginald Averilla |
| | | Reginald Averilla |
| | | Chief Financial Officer |
scnd_ex321.htm EXHIBIT 32.1
CERTIFICATION BY THE CHIEF EXECUTIVE OFFICER
PURSUANT TO SECTION 906
OF THE SARBANES-OXLEY ACT
I, Helena R. Santos, Chief Executive Officer of Scientific Industries, Inc. (the “Company”), certify, to the best of my knowledge that:
| 1. | I have reviewed this Quarterly Report on Form 10-Q of the Company for the period ended March 31, 2024 (the “Quarterly Report”); |
|---|---|
| 2. | the Quarterly Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
| 3. | the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of Scientific Industries, Inc. |
| Scientific Industries, Inc. | ||
|---|---|---|
| Date: May 15, 2024 | By: | /s/ Helena R. Santos |
| | | Helena R. Santos |
| | | Chief Executive Officer |
scnd_ex322.htm EXHIBIT 32.2
CERTIFICATION BY THE CHIEF FINANCIAL OFFICER
PURSUANT TO SECTION 906
OF THE SARBANES-OXLEY ACT
I, Reginald Averilla, Chief Financial Officer of Scientific Industries, Inc. (the “Company”), certify, to the best of my knowledge that:
| 1. | I have reviewed this Quarterly Report on Form 10-Q of the Company for the period ended March 31, 2024 (the “Quarterly Report”); |
|---|---|
| 2. | the Quarterly Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
| 3. | the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of Scientific Industries, Inc. |
| Scientific Industries, Inc. | ||
|---|---|---|
| Date: May 15, 2024 | By: | /s/ Reginald Averilla |
| | | Reginald Averilla |
| | | Chief Financial Officer |