SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net Loss Per Common Share |
The Company calculates basic loss per common share by dividing net loss by the weighted average number of common shares outstanding during the periods. Diluted loss per common share includes the impact from all dilutive potential common shares relating to outstanding convertible securities.
For the three months ended September 30, 2022 and 2021, basic and diluted weighted-average common shares outstanding were and , respectively. The Company incurred a net loss for the three months ended September 30, 2022 and 2021, and therefore, basic and diluted loss per share for the periods were the same because potential common share equivalent would have been anti-dilutive. The total potentially dilutive common shares outstanding at September 30, 2022 and 2021 that were excluded from diluted weighted-average common shares outstanding represent shares underlying outstanding convertible debt, stock options, RSUs, and warrants, and totaled and , respectively.
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| Liquidity Considerations |
Liquidity Considerations
The accompanying financial statements and notes have been prepared assuming the Company will continue as a going concern. For the quarter ended September 30, 2022 and the year ended June 30, 2022, the Company generated negative cash flows from operations of $589,000 and $23.9 million, respectively, and had an accumulated deficit of $84.0 million and $81.8 million, respectively. Management has evaluated the Company’s expected cash requirements over the next twelve (12) months, including investments in additional sales and marketing and research and development, capital expenditures, and working capital requirements. Management believes the Company’s existing cash, funding available under the SVB Credit Facility and the Subordinated LOC, expected improvements in the gross margin and lower cash requirements will enable the Company to fund planned operations for the next twelve (12) months.
Historically the Company has not generated sufficient cash to fund its operations. Based on the Company’s ability to execute its proposed plans, to generate revenue from its existing backlog, management anticipates increased revenues as well as improvements in its gross margin over the next twelve (12) months. The Company has received new orders in the twelve-month period ended September 30, 2022, of approximately $61.6 million and believes through conversations with customers that its anticipation of continued new order increases is probable.
As of November 4, 2022, we had cash balance of $248,000 and $1.4 million remained available under the SVB Credit Facility and $4.0 million was available for future draws under the Subordinated LOC. As of November 4, 2022, $5.7 million remained available under the Company’s ATM agreement that could be utilized if necessary based on trading and market conditions. In addition, to support our operations and anticipated growth, we intend to explore additional sources of capital as needed. We also continue to execute our cost reduction, sourcing, pricing recovery initiatives in efforts to increase our gross margins and improve cash flow from operations. Any unforeseen factors in the general economy beyond management’s control could potentially have negative impact on the planned gross margin improvement plan.
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