LOS ANGELES, Feb. 05, 2021 (GLOBE NEWSWIRE) -- Toga Limited, a Nevada corporation (OTC: TOGL) today announces its unaudited financial results for fiscal years ended July 31, 2020 and 2019.
Year-End 2020 and 2019 Unaudited Financial Highlights
The Company is posting its unaudited financial results as of and for the year-ended July 31, 2020 along with its unaudited, as restated financial results as of and for the year-ended July 31, 2019.
Results of Operations
Fiscal Year Ended July 31, 2020 (Unaudited) Compared to Fiscal Year Ended July 31, 2019 (Unaudited) (As restated)
| Year ended | ||||||||||||||||
| July 31, | ||||||||||||||||
| 2020 (Unaudited) | 2019 (Unaudited) (As restated) | Change | % | |||||||||||||
| Revenue | $ | 16,488,953 | $ | 5,888,234 | $ | 10,600,719 | 180.0 | % | ||||||||
| Cost of Goods Sold | 10,347,848 | 1,729,748 | 8,618,100 | 498.2 | % | |||||||||||
| Gross Profit (Loss) | $ | 6,141,105 | $ | 4,158,486 | $ | 1,982,619 | 47.7 | % | ||||||||
| Gross Margin | 37.24 | % | 70.62 | % | ||||||||||||
Gross Margin by product for the year ended July 31, 2020 (Unaudited)
| Product Sales | Advertising | Royalty Fee | Yippi | TogaGo | Total | |||||||||||||||||||
| Revenue | $ | 7,945,893 | $ | 801,034 | $ | 400,000 | $ | 6,353,451 | $ | 988,575 | $ | 16,488,953 | ||||||||||||
| Cost of Goods Sold | 3,901,950 | - | - | 5,531,377 | 914,521 | 10,347,848 | ||||||||||||||||||
| Gross Profit (Loss) | $ | 4,043,943 | $ | 801,034 | $ | 400,000 | $ | 822,074 | $ | 74,054 | $ | 6,141,105 | ||||||||||||
| Gross Margin | 50.89 | % | 100.00 | % | 100.00 | % | 12.94 | % | 7.49 | % | 37.24 | % | ||||||||||||
Gross Margin by product for the year ended July 31, 2019 (Unaudited) (as restated)
| Software Maintenance | ||||||||||||||||||||||||||||||||
| Product | Royalty | Management | & | |||||||||||||||||||||||||||||
| Sales | Advertising | Fee | Fee | Yippi | TogaGo | Subscription | Total | |||||||||||||||||||||||||
| Revenue | $ | 4,273,252 | $ | 190,400 | $ | 240,000 | $ | 1,072,630 | $ | - | $ | - | $ | 111,952 | $ | 5,888,234 | ||||||||||||||||
| Cost of Goods Sold | 379,237 | - | - | - | 1,337,477 | 13,034 | - | 1,729,748 | ||||||||||||||||||||||||
| Gross Profit (Loss) | $ | 3,894,015 | $ | 190,400 | $ | 240,000 | $ | 1,072,630 | $ | (1,337,477 | ) | $ | (13,034 | ) | $ | 111,952 | $ | 4,158,486 | ||||||||||||||
| Gross Margin | 91.13 | % | 100.00 | % | 100.00 | % | 100.00 | % | - | - | 100.00 | % | 70.62 | % | ||||||||||||||||||
Revenue increased by approximately $10.6 million in the year ended July 31, 2020, compared to the prior year period, driven by a $6.4 million increase in Yippi in-app purchases, a $989,000 increase in TogaGo platform sales, and a $3.7 million increase in direct marketing network revenue.
Gross profit also increased by approximately $2.0 million in the year ended July 31, 2020, compared to the prior year period, due to the new business lines. We invested significantly in staff and infrastructure, which was in the early implementation stage, but management expects reductions in our general and administrative expenses as a percentage of revenue going forward.
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| July 31, | ||||||||||||||||||||||||
| 2020 (Unaudited) | 2019 (Unaudited) (As restated) | Change | % | |||||||||||||||||||||
| Operating expenses: | ||||||||||||||||||||||||
| General and administrative expenses | $ | 6,748,888 | 3,183,220 | 3,565,668 | 112.0 | % | ||||||||||||||||||
| Salaries and wages | 6,515,159 | 13,074,717 | (6,559,558 | ) | (50.2 | )% | ||||||||||||||||||
| Professional fees | 2,457,035 | 1,110,236 | 1,346,799 | 121.3 | % | |||||||||||||||||||
| Depreciation | 278,247 | 93,426 | 184,821 | 197.8 | % | |||||||||||||||||||
| Total operating expenses | 15,999,329 | 17,461,599 | (1,462,270 | ) | (8.4 | )% | ||||||||||||||||||
| Loss from Operations | (9,858,224 | ) | (13,303,113 | ) | 3,444,889 | (25.9 | )% | |||||||||||||||||
| Other Income (Expense) | 560,044 | 3,246,419 | (2,686,375 | ) | (82.7 | )% | ||||||||||||||||||
| Net Loss | $ | (9,868,611 | ) | (10,212,214 | ) | 343,603 | (3.4 | )% | ||||||||||||||||
Net loss decreased by approximately $344,000, or 3.4%, in the year ended July 31, 2020, compared to the prior year period, due to an increase in gross profit offset by a decrease in other income of $2.7 million and a decrease in loss from operations primarily attributed to the decreases in salary and wages, including stock-based compensation, offset by an increase in general and administrative expenses of approximately $3.6 million.
Liquidity and Capital Resources
| July 31, | July 31, | |||||||||||||||
2020 (Unaudited) | 2019 (Unaudited) (As restated) | Change | % | |||||||||||||
| Cash and cash equivalents | $ | 9,374,314 | $ | 14,916,556 | $ | (5,542,242 | ) | (37.2 | %) | |||||||
| Total Assets | $ | 18,026,404 | $ | 23,554,425 | $ | (5,528,021 | ) | (23.5 | % | |||||||
| Total Liabilities | $ | 10,269,467 | $ | 9,049,782 | $ | 1,219,685 | 13.5 | % | ||||||||
| Working Capital | $ | 3,270,210 | $ | 10,080,247 | $ | (6,810,037 | ) | (67.6 | %) | |||||||
As of July 31, 2020, our total assets were $18.0 million, and our total liabilities were $10.0 million. Liabilities were comprised primarily of current liabilities of $10.3 million, of which included accounts payable and accrued liabilities of $3.5 million and deferred revenue of $6.6 million.
Our stockholders’ equity decreased from $14.7 million as of July 31, 2019 to $7.8 million as of July 31, 2020.
We had $9.4 million in cash as of July 31, 2020, and we had assets to meet ongoing expenses or debts that may accumulate. Accumulated deficit was $34.5 million as of July 31, 2020, compared to accumulated deficit of approximately $24.6 million as of July 31, 2019.
Our working capital decreased by $6.8 million to $3.3 million at July 31, 2020, as compared to $10.1 million at July 31, 2019, due primarily to the decrease in our current assets, consisting of a decrease in cash and cash equivalents of $5.5 million and prepaid expense and other current assets of $2.8 million, and the increase in our current liabilities, consisting of an increase in and deferred revenue of $1.8 million.
Cash Flow
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| July 31, | Change | |||||||||||||||||
| 2020 (Unaudited) | 2019 (Unaudited) (As restated) | Amount | % | |||||||||||||||
| Cash Flows provided by (used in) operating activities | $ | (5,345,401 | ) | $ | 2,729,719 | $ | (8,075,120 | ) | (295.8 | %) | ||||||||
| Cash Flows (used in) investing activities | (351,600 | ) | (372,077 | ) | 20,477 | (5.5 | %) | |||||||||||
| Cash Flows provided by (used in) financing activities | (36,616 | ) | 11,371,008 | (11,407,624 | ) | (100.3 | %) | |||||||||||
| Effects on changes in foreign exchange rate | 191,375 | 123,234 | 68,141 | 55.3 | % | |||||||||||||
| Net change in cash and cash equivalents during period | $ | (5,542,242 | ) | $ | 1,064,572 | $ | (6,606,814 | ) | (620.6 | %) | ||||||||
Cash Flow from Operating Activities
As of July 31, 2020, we had not generated positive cash flow from operating activities. For the year ended July 31, 2020, net cash flows used in operating activities was $5.3 million compared to $2.7 provided by operating activities during the year ended July 31, 2019. Cash flows provided by operating activities for the year ended July 31, 2020 was comprised of a net loss of $9.9 million, which was offset by non-cash expenses of $4.2 million, of which $3.5 million for loss on for stock-based compensation, and a net change in working capital of $2.8 million. Cash flows provided by operating activities for the year ended July 31, 2019 was comprised of a net loss of $10.2 million, which was increased by non-cash income of $3.2 million for gain on sale of digital currency, and was offset by non-cash expenses of $93,000 for depreciation, $11.1 million for stock-based compensation, and a net change in working capital of $5.0 million.
Cash Flows from Investing Activities
During the year ended July 31, 2020, we used $351,000 for the purchase of property and equipment. During the year ended July 31, 2019, we used $372,000 in investing activities for the purchase of property and equipment.
Cash Flows from Financing Activities
We have financed our operations primarily from either advances and loans from related and third parties or the issuance of equity instruments. For the year ended July 31, 2020, net cash used in financing activities was $37,000, consisting of proceeds from subscription receivable and proceeds from related parties of $224,000, offset by repayment to related parties of $107,000 and redemption of stock options of $157,000. For the year ended July 31, 2019, net cash provided by financing activities was $11.4 million, consisting of proceeds from the sale of shares of our Common Stock of $2.1 million, and proceeds from sales of digital currency of $9.5 million, offset by repayment to related parties of $185,000.
Contact:
Alexander D. Henderson
TOGA LIMITED, 515 S. Flower Street, 18th Floor, Los Angeles, CA 90071
(949) 333-1603
info@togalimited.com