Icoreconnect Inc. (ICCT) has recently reported an operating loss of $4.8 million for the fiscal year ending December 31, 2022. This marks a significant loss for the company, raising questions about its financial stability and future growth prospects.
Operating in the North American market, Icoreconnect provides healthcare communications systems and is involved in developing strategic partnerships to sustain its business operations. The primary financial activities in 2022 were financed through private placements of equity securities and the issuance of debt. The 2022 financial report also highlights an accumulated deficit of $88,875,087 and a net working capital deficit of $5,707,301.
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Concerns About Viability as Going Concern
Despite attempts to increase its customer base and secure contracts, Icoreconnect’s financial losses raise concerns about its viability as a going concern. The company’s management is currently working on raising additional funds for its operations in the near future. However, these fundraising efforts may not be successful or yield satisfactory terms for the company. Coupled with continued financial strain, Icoreconnect’s ability to continue as a going concern remains uncertain.
Stock Issuance in 2022 and 2021
Throughout 2022, Icoreconnect issued 13,827,049 shares of common stock for various reasons, including cash, convertible debt conversions, and stock-based compensation. The company raised $450,000 from the issuance of 5,722,844 shares of common stock, while 227,368 shares were issued for the conversion of $22,387 of convertible debt. In February, 8,426,837 shares of common stock were issued for stock-based compensation, valued at $1,817,123.
Significant stock issuance also occurred in 2021, with 42,719,600 shares of common stock being issued for cash of $2,776,230. Notably, 9,296,617 shares were issued in relation to the acquisition of the assets of Advantech, BCS, and Spectrum Technology Solutions, and 3,151,416 shares were issued for stock compensation expense of $331,945.
Challenges in Securing Financing and Continuing as Going Concern
Icoreconnect’s efforts to issue and secure contracts have not been enough to salvage its financial situation. Given these circumstances, the company’s chances of successfully securing financing in the form of debt or equity securities seems improbable. Furthermore, the company’s ability to continue as a going concern is ultimately dependent on its ability to increase its customer base and generate revenue from signed contracts.
Overall, Icoreconnect’s financial situation is precarious, prompting questions about its future as a going concern. With a substantial operating loss of $4.8 million in 2022 and an ongoing working capital deficit, the company’s prospects for securing financing and ensuring future growth need to be immediately addressed.
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