SCNX 8-K
Scienture Holdings, Inc. (SCNX)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date
of Report (Date of Earliest Event Reported):
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
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Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
$0.00001 Par Value Per Share |
(Nasdaq Capital Market) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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.
Item 2.02 Results of Operations and Financial Condition.
On March 28, 2022, TRxADE HEALTH, INC., (“Trxade” or the “Company”) issued a press release announcing it will hold a conference call and webcast at 5:00 p.m. Eastern time regarding its financial results for the three months and full year ended December 31, 2021. A copy of the press release, which includes information on the conference call and webcast and a summary of such financial results is furnished as Exhibit 99.1 to this Form 8-K and is incorporated herein by reference.
The information contained in this Current Report (and included as exhibits hereto) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Trxade is making reference to non-GAAP financial information in both the press release and the conference call/webcast. A reconciliation of these non-GAAP financial measures to the comparable GAAP financial measures is contained in the attached press release.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
Effective on March 24, 2022, the Company authorized the indemnification, to the extent allowed pursuant to federal and state law, and the Company’s governing documents, and subject to a final non-appealable adjudication of any claims, of Mr. Suren Ajjarapu, the Company’s Chief Executive Officer and Chairman, in the event that Mr. Ajjarapu is required to guaranty the Company’s obligations under its lease for its principal business location (which total an aggregate of approximately $1.18 million over the five year term of the lease), which lease agreement provides for the personal guaranty of Mr. Ajjarapu of such lease obligation, but which guaranty has not been documented or memorialized to date.
Item 3.03 Material Modification to Rights of Security Holders.
To the extent required by Item 3.03 of Form 8-K, the information contained in Item 5.03 relating to the Bylaws Amended (as defined and discussed in Item 5.03), is incorporated in this Item 3.03 by reference.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
To the extent that the indemnification described in Item 2.03 above is deemed a material compensatory plan, contract or arrangement, or otherwise disclosable pursuant to this Item 5.02, the information contained in Item 2.03 hereof is incorporated in this Item 5.02 by reference.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
On and effective on March 24, 2022, the Company’s Board of Directors, pursuant to the power provided to the Board of Directors by the Company’s Amended and Restated Bylaws (the “Bylaws”), and the Company’s Certificate of Incorporation, as amended, amended Section 3.11 of the Company’s Bylaws to remove such provision thereof from the Bylaws in its entirety, which Section of the Bylaws required the affirmative vote of at least two-thirds of the Company’s outstanding voting shares to remove a member of the Board of Directors of the Company from office (the “Bylaws Amendment”).
The foregoing description of the Bylaws Amendment is qualified in its entirety by reference to the full text of the Bylaws Amendment filed herewith as Exhibit 3.1 hereto, and incorporated by reference herein.
Item 7.01 Regulation FD Disclosure.
The Company’s management plans to hold virtual roadshows and meetings with current and prospective investors, funding sources, and others, and to attend certain virtual conferences from time to time.
A copy of the presentation which the Company will use in connection with such conferences, roadshows and meetings is being furnished as Exhibit 99.2 to this Current Report on Form 8-K, and is incorporated by reference herein, and is also available on the Company’s website at https://investors.trxadegroup.com/nasdaq-meds/presentations-nasdaq-meds/, which website includes information the Company does not desire to incorporate by reference into this report.
The information responsive to Item 7.01 of this Form 8-K and Exhibit 99.2, attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended or the Exchange Act, except as expressly set forth by specific reference in such a filing. The furnishing of this Report is not intended to constitute a determination by the Company that the information is material or that the dissemination of the information is required by Regulation FD.
Item 9.01 Financial Statements and Exhibits.
| Exhibit No. | Description | |
| 3.1* | Amendment to Amended and Restated Bylaws effective March 24, 2022 | |
| 99.1** | Press Release of TRxADE HEALTH, INC. dated March 28, 2022 | |
| 99.2** | TRxADE HEALTH, INC. – March 2022 PowerPoint Presentation | |
| 104 | Inline XBRL for the cover page of this Current Report on Form 8-K |
* Filed herewith.
** Furnished herewith.
Forward Looking Statements
The press release attached hereto as Exhibit 99.1 and [presentation attached hereto as Exhibit 99.2], contain certain statements that may be deemed to be “forward-looking statements” within the federal securities laws, including the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by words such as “may,” “should,” “expect,” “anticipate,” “believe,” “estimate,” “intend,” “plan” and other similar expressions. Forward-looking statements are not a guarantee of performance and are subject to a number of risks and uncertainties, many of which are difficult to predict and are beyond our control. These risks and uncertainties should be carefully considered. We caution you not to place undue reliance on the forward-looking statements, which involve known and unknown risks, uncertainties and relate to the Company’s current expectations and are subject to the limitations and qualifications set forth in the press release and presentation as well as in the Company’s other filings with the Securities and Exchange Commission. These statements also involve known and unknown risks, which may cause the results of the Company, its divisions and concepts to be materially different than those expressed or implied in such statements. Forward-looking statements may include comments as to the Company’s beliefs and expectations as to future financial performance, events and trends affecting its business and are necessarily subject to uncertainties, many of which are outside the Company’s control. More information on potential factors that could affect the Company’s financial results is included from time to time in the “Cautionary Note Regarding Forward-Looking Statements,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s periodic and current filings with the SEC, including the Form 10-Qs and Form 10-Ks, filed with the SEC and available at www.sec.gov and in the “NASDAQ:MEDS” — “SEC Filings” section of the Company’s website at https://www.investors.trxadegroup.com, and specifically including the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, and subsequent periodic reports. Forward-looking statements speak only as of the date they are made. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise that occur after that date, except as otherwise provided by law.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| TRXADE HEALTH, INC. | ||
| Date: March 28, 2022 | By: | /s/ Suren Ajjarapu |
| Name: | Suren Ajjarapu | |
| Title: | Chief Executive Officer | |
Exhibit 3.1
AMENDMENT TO THE AMENDED AND RESTATED BYLAWS
OF
TRxADE HEALTH, INC.
Effective March 24, 2022, Section 3.11 of the Amended and Restated Bylaws of TRxADE HEALTH, INC. (formerly TRXADE GROUP, INC.) (the “Company”), as amended and restated to date, is hereby amended and restated in its entirety as follows:
“3.11. [RESERVED]”
Exhibit 99.1
TRxADE HEALTH Reports Year End 2021 Financial Results
Continues Nationwide Expansion of Breakthrough Digital Healthcare Services IT Platform
TAMPA, FL, March 28, 2022 — TRxADE HEALTH, INC. (NASDAQ:MEDS)(“TRxADE”, “TRxADE HEALTH” or the “Company”), a health services IT company focused on digitalizing the retail pharmacy experience by optimizing drug procurement, the prescription journey and patient engagement in the U.S., today announced its financial results for the fourth quarter (Q4) and year ended (FY) December 31, 2021.
Fourth Quarter 2021 Financial Summary and Operational Highlights
TRxADE continued to expand the TRxADE drug procurement marketplace nationwide, adding 175 new registered members in Q4 2021, bringing the total registered members to approximately 13,100+ at the end of 2021.
Revenues for the fourth quarter of 2021 increased 19.7% to $2.4 million, compared to revenue of $2.0 million in the same quarter last year. The increase in revenue was primarily due to revenue generated by the TRxADE Platform and TRxADE Prime, the Company’s business to business web-based marketplace.
Gross profit in the fourth quarter of 2021 increased 831% to $1.24 million or 51.9% of revenues, compared to $0.1 million, or 6.5% of revenues, in the same quarter last year. The increase in gross profit was primarily attributable to revenue generated by TRxADE Platform, which has a lower cost of sales.
Operating expenses in the fourth quarter of 2021 were $2.0 million compared to $2.4 million in the same quarter last year. This decrease was due primarily to a loss on impairment of goodwill recognized in the same quarter last year, which was a one-time charge.
Net Loss in the fourth quarter of 2021 was ($0.8) million or ($0.10) per basic and diluted share outstanding, compared to ($2.3) million, or ($0.29) per basic and diluted share outstanding, as a result of a $726,000 loss on impairment of goodwill and a one-time $1,081,000 inventory write down, compared to the same quarter last year.
Adjusted EBITDA, a non-GAAP financial measure, decreased to negative $0.8 million in the fourth quarter of 2021, compared to negative $1.4 million in the same quarter last year. See “Use of Non-GAAP Financial Information” below, and the reconciliation of Adjusted EBITDA to GAAP set forth at the end of this release.
Fiscal Year Ended December 31, 2021 Summary
Revenues for the 2021 year decreased 42.2% to $9.9 million, compared to $17.1 million in 2020. The decrease in revenue was due to revenue generated in 2020 by Integra Pharma Solutions, our wholly-owned subsidiary, which revenue was from Personal Protective Equipment (PPE) sales relating to the COVID-19 pandemic in 2020, which decreased in 2021.
Gross profit in fiscal 2021 decreased 16.8% to $4.7 million, or 48.0% of revenues, compared to $5.7 million, or 33.0% of revenues for last year. The increase in gross profit percentage was primarily attributable to higher margins associated with TRxADE Platform revenue, which has a lower cost of sales.
Operating expenses in 2021 were $10.0 million, compared to $8.2 million last year. This increase is primarily due to the Loss on Inventory Investment and, an increase in IT initiatives in our Bonum Health and Alliance Pharma companies.
Net Loss in 2021 was ($5.3) million, or ($0.65) per basic and diluted share outstanding, compared to ($2.5) million, or ($0.33) per basic and diluted share outstanding, last year.
Adjusted EBITDA for the year ended 2021 was negative ($3.7) million compared to positive $0.1 million for the year ended 2020. See “Use of Non-GAAP Financial Information” below, and the reconciliation of Adjusted EBITDA to GAAP set forth at the end of this release.
Looking at our balance sheet, cash and cash equivalents were $3.1 million as of December 31, 2021, compared with $5.9 million as of December 31, 2020. The decrease in cash was due to our IT initiatives with Bonum Health and Alliance Pharma and loss on inventory investment.
Conference Call and Webcast
Management will host a conference call on Monday, March 28, 2022, at 5:00 p.m. Eastern time to discuss TRxADE HEALTH’s fourth quarter and fiscal year 2021 financial results. The call will conclude with Q&A from participants. To participate, please use the following information:
Q4 and Fiscal Year 2020 Conference Call and Webcast
Date: Monday, March 28, 2021
Time: 5:00 p.m. Eastern time
U.S. Dial-in: 1-877-425-9470
International Dial-in: 1-201-389-0878
Conference ID: 13727651
Webcast: https://viavid.webcasts.com/starthere.jsp?ei=1534472&tp_key=20fddfb1b1
Please dial in at least 10 minutes before the start of the call to ensure timely participation.
A playback of the call will be available through April 28, 2022. To listen, call 1-844-512-2921 within the United States or 1-412-317-6671 when calling internationally and enter replay pin number 13727651. A webcast will also be available for 30 days on the IR section of the TRxADE HEALTH, INC. website or by clicking the webcast link above.
About TRxADE HEALTH, INC.
TRxADE HEALTH (NASDAQ: MEDS) is a health services IT company focused on digitalizing the retail pharmacy experience by optimizing drug procurement, the prescription journey and patient engagement in the U.S. The Company operates the TRxADE drug procurement marketplace serving a total of 13,100+ members nationwide, fostering price transparency and under the Bonum Health brand, offering patient centric telehealth services. For more information on TRxADE HEALTH, please visit the Company’s IR website at investors.trxadegroup.com.
Use of Non-GAAP Financial Information
In addition to our results calculated under generally accepted accounting principles in the United States (“GAAP”), in this earnings release we also present EBITDA and Adjusted EBITDA which are “non-GAAP financial measures” presented as supplemental measures of the Company’s performance. They are not presented in accordance with GAAP. EBITDA represents net income before interest, taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA before stock-based compensation expense, loss (gain) on inventory investment and loss (gain) on impairment of goodwill. EBITDA and Adjusted EBITDA are presented because we believe they provide additional useful information to investors due to the various noncash items during the period. EBITDA and Adjusted EBITDA are also frequently used by analysts, investors and other interested parties to evaluate companies in our industry. We believe these non-GAAP financial measures are useful to investors both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making and (2) they are used by our institutional investors and the analyst community to help them analyze the health of our business. EBITDA and Adjusted EBITDA have limitations as analytical tools, and you should not consider them in isolation, or as a substitute for analysis of our operating results as reported under GAAP. Some of these limitations are: EBITDA and Adjusted EBITDA do not reflect cash expenditures, future requirements for capital expenditures, or contractual commitments; EBITDA and Adjusted EBITDA do not reflect changes in, or cash requirements for, working capital needs; and EBITDA and Adjusted EBITDA do not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on debt or cash income tax payments. Although depreciation and amortization are noncash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDA and Adjusted EBITDA do not reflect any cash requirements for such replacements. Additionally, other companies in our industry may calculate EBITDA and Adjusted EBITDA differently than TRxADE HEALTH, Inc. does, limiting its usefulness as a comparative measure. EBITDA and Adjusted EBITDA are not recognized in accordance with GAAP, are unaudited, and have limitations as analytical tools, and you should not consider them in isolation, or as substitutes for analysis of the Company’s results as reported under GAAP. The Company’s presentation of these measures should not be construed as an inference that future results will be unaffected by unusual or nonrecurring items. We compensate for these limitations by providing a reconciliation of each of these non-GAAP measures to the most comparable GAAP measure. We encourage investors and others to review our business, results of operations, and financial information in their entirety, not to rely on any single financial measure, and to view these non-GAAP measures in conjunction with the most directly comparable GAAP financial measure. For more information on these non-GAAP financial measures, please see the section titled “Reconciliation of Net Income attributable to TRxADE HEALTH, INC., to Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA) and Adjusted EBITDA”, included at the end of this release.
Forward-Looking Statements
This press release may contain forward-looking statements, including information about management’s view of TRxADE’s future expectations, plans and prospects, within the meaning of the federal securities laws, including the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. In particular, when used in the preceding discussion, the words “may,” “could,” “expect,” “intend,” “plan,” “seek,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “continue,” “likely,” “will,” “would” and variations of these terms and similar expressions, or the negative of these terms or similar expressions are intended to identify forward-looking statements. Any statements made in this news release other than those of historical fact, about an action, event or development, are forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors, which may cause the results of TRxADE, its divisions and concepts to be materially different than those expressed or implied in such statements. These risks include risks relating to agreements with third parties, including Coborn’s; the planned benefits, expected users of, and projected revenues of our joint venture with Exchange Health; our operations not being profitable; the commercial viability of new business lines, applications, products and technologies, and the costs of such items; the Company’s stock repurchase program; the adoption of the Company’s product offerings; claims relating to alleged violations of intellectual property rights of others; our ability to monetize our technological solutions; technical problems with our websites, apps and products; risks relating to implementing our acquisition strategies; challenges to the pharmaceutical supply chain posted by the COVID-19 pandemic and related matters; our ability to manage our growth; negative effects on our operations associated with the opioid pain medication health crisis; regulatory and licensing requirement risks; risks related to changes in the U.S. healthcare environment; the status of our information systems, facilities and distribution networks; risks associated with the operations of our more established competitors; regulatory changes; new competitors which may have more resources than we do; increases in direct to consumer sales of drugs; healthcare fraud; COVID-19, governmental responses thereto, economic downturns and increased inflation and possible recessions caused thereby; changes in laws or regulations relating to our operations; privacy laws; system errors; dependence on current management; our growth strategy; dilution which may be caused by future offerings; our ability to raise funding in the future, as and if needed, and the terms of such funding; increased inflation; and others that are included from time to time in filings made by TRxADE with the Securities and Exchange Commission, including, but not limited to, in the “Risk Factors” sections in its Form 10-Ks and Form 10-Qs and in its Form 8-Ks, which it has filed, and files from time to time, with the U.S. Securities and Exchange Commission (SEC), and more particularly in the Annual Report on Form 10-K filed today with the SEC. These reports are available at www.sec.gov. Other unknown or unpredictable factors also could have material adverse effects on TRxADE’s future results and/or could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements. The forward-looking statements included in this press release are made only as of the date hereof. TRxADE cannot guarantee future results, levels of activity, performance or achievements. Accordingly, you should not place undue reliance on these forward-looking statements. We undertake no obligation to update publicly any of these forward-looking statements to reflect actual results, new information or future events, changes in assumptions or changes in other factors affecting forward-looking statements, except to the extent required by applicable laws. If we update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements.
Investor Relations:
Investors.trxadegroup.com
TRxADE HEALTH, INC.
Consolidated Balance Sheets
December 31, 2021 and 2020
| December 31, 2021 | December 31, 2020 | |||||||
| Assets | ||||||||
| Current Assets | ||||||||
| Cash | $ | 3,122,578 | $ | 5,919,578 | ||||
| Accounts Receivable, net | 978,973 | 805,043 | ||||||
| Inventory | 56,279 | 1,257,754 | ||||||
| Prepaid Assets | 216,414 | 151,248 | ||||||
| Other Receivables | - | 1,087,675 | ||||||
| Total Current Assets | 4,374,244 | 9,221,298 | ||||||
| Property Plant and Equipment, Net | 98,751 | 162,397 | ||||||
| Other Assets | ||||||||
| Deposits | 60,136 | 21,636 | ||||||
| Right of use leased assets | 1,233,033 | 387,371 | ||||||
| Total Assets | $ | 5,766,164 | $ | 9,792,702 | ||||
| Liabilities and Stockholders’ Equity | ||||||||
| Current Liabilities | ||||||||
| Accounts Payable | $ | 477,028 | $ | 256,829 | ||||
| Accrued Liabilities | 270,437 | 219,256 | ||||||
| Current Portion - Operating Lease Liabilities | 178,561 | 131,153 | ||||||
| Customer Deposits | - | 10,000 | ||||||
| Notes Payable – Related Party | - | 225,000 | ||||||
| Total Current Liabilities | 926,026 | 842,238 | ||||||
| Long Term Liabilities | ||||||||
| Operating Lease Liabilities, net of current portion | 1,069,965 | 271,306 | ||||||
| Total Liabilities | 1,995,991 | 1,113,544 | ||||||
| Stockholders’ Equity | ||||||||
| Series A Preferred Stock, $0.00001 par value; 10,000,000 shares authorized; none issued and outstanding as of December 31, 2021, and December 31, 2020, respectively | - | - | ||||||
| Common Stock, $0.00001 par value; 100,000,000 shares authorized; 8,166,457 and 8,093,199 shares issued and outstanding as of December 31, 2021 and 2020, respectively | 82 | 81 | ||||||
| Additional Paid-in Capital | 20,017,528 | 19,610,631 | ||||||
| Retained Deficit | (16,247,437 | ) | (10,931,554 | ) | ||||
| Total Stockholders’ Equity | 3,770,173 | 8,679,158 | ||||||
| Total Liabilities and Stockholders’ Equity | $ | 5,766,164 | $ | 9,792,702 | ||||
TRxADE HEALTH, INC.
Consolidated Statements of Operations
Years Ended December 31, 2021 and 2020
| 2021 | 2020 | |||||||
| Revenues, net | $ | 9,889,433 | $ | 17,122,520 | ||||
| Cost of Sales | 5,143,468 | 11,415,198 | ||||||
| Gross Profit | 4,745,965 | 5,707,322 | ||||||
| Operating Expenses | ||||||||
| Loss on Inventory Investment | 1,226,426 | - | ||||||
| Loss on Impairment of Goodwill | - | 725,973 | ||||||
| General and Administrative | 8,811,832 | 7,488,011 | ||||||
| Total Operating Expenses | 10,038,258 | 8,213,984 | ||||||
| Operating Loss | (5,292,293 | ) | (2,506,662 | ) | ||||
| Interest Expense | (23,590 | ) | (29,389 | ) | ||||
| Net Loss | $ | (5,315,883 | ) | $ | (2,536,051 | ) | ||
| Net Loss per Common Share – Basic and Diluted | $ | (0.65 | ) | $ | (0.33 | ) | ||
| Weighted average Common Shares Outstanding – Basic and Diluted | 8,136,740 | 7,705,620 | ||||||
TRxADE HEALTH, INC.
Consolidated Statements of Cash Flows
Years ended December 31, 2021 and 2020
| 2021 | 2020 | |||||||
| Operating Activities: | ||||||||
| Net loss | $ | (5,315,883 | ) | $ | (2,536,051 | ) | ||
| Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||
| Depreciation Expense | 7,351 | 5,500 | ||||||
| Options Expense | 187,273 | 448,404 | ||||||
| Warrant Expense | 21,640 | 56,885 | ||||||
| Common Stock Issued for Services | 181,163 | 1,357,759 | ||||||
| Bad Debt Expense | 615,657 | 10,539 | ||||||
| Loss on Inventory Investment | 143,891 | - | ||||||
| Loss on Impairment of Goodwill | - | 725,973 | ||||||
| Loss on write-down of Inventory | 376,348 | 1,218,020 | ||||||
| Amortization of Right-of-Use Asset | 131,558 | 97,020 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts Receivable | (789,587 | ) | (23,532 | ) | ||||
| Prepaid Assets and Other Current Assets | (103,666 | ) | (68,796 | ) | ||||
| Inventory | 825,127 | (2,419,013 | ) | |||||
| Deposits for Inventory Purchases | - | (1,087,675 | ) | |||||
| Other Receivables | 1,087,675 | - | ||||||
| Lease Liability | (131,153 | ) | (97,033 | ) | ||||
| Accounts Payable | 220,199 | (33,190 | ) | |||||
| Accrued Liabilities and Other Liabilities | (13,819 | ) | 120,404 | |||||
| Customer Deposits | (10,000 | ) | 10,000 | |||||
| Net cash used in operating activities | (2,566,226 | ) | (2,214,786 | ) | ||||
| Investing Activities: | ||||||||
| Purchase of Fixed Assets | (22,596 | ) | (37,505 | ) | ||||
| Net cash used in Investing Activities | (22,596 | ) | (37,505 | ) | ||||
| Financing Activities: | ||||||||
| Repayments of Short-Term Promissory Notes – Related Parties | (225,000 | ) | - | |||||
| Payment of Stock Issuance Costs | - | (732,356 | ) | |||||
| Proceeds from Exercise of Warrants | 15,001 | 37,606 | ||||||
| Proceeds from Exercise of Stock Options | 1,821 | 501 | ||||||
| Proceeds from Issuance of Common Stock | - | 5,994,424 | ||||||
| Net Cash provided by (used in) financing activities | (208,178 | ) | 5,300,175 | |||||
| Net increase (decrease) in Cash | (2,797,000 | ) | 3,047,884 | |||||
| Cash at Beginning of the Year | 5,919,578 | 2,871,694 | ||||||
| Cash at End of the Year | $ | 3,122,578 | $ | 5,919,578 | ||||
| Supplemental Cash Flow Information | ||||||||
| Cash Paid for Interest | $ | 28,337 | $ | 29,442 | ||||
| Cash Paid for Income Taxes | $ | - | $ | - | ||||
| Non-Cash Transactions | ||||||||
| Remeasurement of ROU Assets and Lease Liability for Nonrenewal of Lease | $ | - | $ | 273,319 | ||||
Reconciliation of Net Income (Loss) attributable to TRxADE HEALTH, INC., to Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA) and Adjusted EBITDA*
| For the three months ended December 31, | Fiscal Year ended December 31, | |||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
| Net loss attributable to TRxADE HEALTH, INC. | $ | (784,340 | ) | $ | (2,312,612 | ) | $ | (5,315,883 | ) | $ | (2,536,051 | ) | ||||
| Add (deduct): | ||||||||||||||||
| Interest, net | 2,016 | 6,725 | 23,590 | 29,389 | ||||||||||||
| Depreciation and amortization | 2,101 | 1,750 | 7,351 | 5.500 | ||||||||||||
| EBITDA | (780,223 | ) | (2,303,687 | ) | (5,284,942 | ) | (2,501,162 | ) | ||||||||
| Add (deduct): | ||||||||||||||||
| Loss on Inventory Investment | - | - | 1,226,426 | - | ||||||||||||
| Loss on impairment of Goodwill | - | 725,973 | - | 725,973 | ||||||||||||
| Stock-based compensation | (62,782 | ) | 162,877 | 390,076 | 1,863,048 | |||||||||||
| Adjusted EBITDA * | $ | (843,005 | ) | $ | (1,414,837 | ) | $ | (3,668,440 | ) | $ | 87,859 | |||||
* EBITDA and Adjusted EBITDA are non-GAAP financial measures. These measurements are not recognized in accordance with GAAP and should not be viewed as an alternative to GAAP measures of performance. See also “Use of Non-GAAP Financial Measures”, above.
Exhibit 99.2
