DGWR.OTC.PinkDeep Green Waste & Recycling, INC
10-Q: Deep Green Waste & Recycling Reports Increased Revenue in Q2 2024, Reduces Net Loss
Sentiment:
Quarterly Report
Deep Green Waste & Recycling, Inc. reports increased revenue and a reduced net loss for the six months ended June 30, 2024, driven by growth in asbestos and radon remediation services.
Capital raiseThe company believes it will have to raise an additional $500,000 to expand its operations over the next twelve months.Future financing may include the issuance of equity or debt securities, obtaining credit facilities, or other financing mechanisms.
Better than expectedThe company's revenue increased compared to the same period last year.The company's net loss decreased compared to the same period last year.The company's operating expenses decreased compared to the same period last year.
Summary
- Deep Green Waste & Recycling, Inc. reported financial results for the six months ended June 30, 2024.
- Revenue increased to $653,354, compared to $348,603 for the same period in 2023, primarily due to growth in asbestos and radon remediation services.
- The cost of sales was $144,775, compared to $90,133 in the prior year.
- Gross profit increased to $508,579 from $258,470 in the prior year.
- Operating expenses decreased from $1,373,871 to $764,356, mainly due to non-cash stock compensation in 2023.
- The operating loss was reduced to $255,777 from $1,115,401 in the prior year.
- Other income improved to $233,679, driven by a noncash derivative adjustment and an $81,000 trade payable gain.
- The net loss was $(42,700) compared to a loss of $(1,273,589) for the same period in 2023.
- The net loss per share was $(0.0048) compared to $(0.9823) in the prior year.
- As of June 30, 2024, the company had cash of $69,438, current assets of $402,246, and current liabilities of $4,455,694.
- The company had an accumulated deficit of $13,104,277 and a stockholders' deficit of $(3,342,750).
- The company sold substantially all of the assets of Amwaste on March 20, 2024, for $185,000.
Sentiment
Score: 6
Explanation: The sentiment is neutral to slightly positive. While the company shows improved financial performance in terms of revenue growth and loss reduction, significant challenges remain, including going concern uncertainty, high debt levels, and negative working capital. The potential for future growth through strategic initiatives is a positive factor.
Positives
- Significant increase in revenue driven by remediation services.
- Substantial improvement in gross profit.
- Significant reduction in operating expenses.
- Considerable decrease in net loss.
- Sale of Amwaste assets provides additional cash proceeds.
Negatives
- The company has a significant amount of outstanding debt.
- The company has a large accumulated deficit.
- The company has negative working capital.
- The company has a substantial amount of accounts payable.
Risks
- The company's independent auditor has expressed substantial doubt about its ability to continue as a going concern.
- The company has a history of net losses and expects to continue to incur negative cash flows.
- The company is dependent on the sale of its securities to fund its operations.
- The company may be unable to raise the funds needed to expand its operations.
- The company has a significant amount of outstanding debt and accounts payable.
- The company may face litigation related to unpaid default judgments.
Future Outlook
The company plans to expand its service offerings, acquire profitable waste and recycling services companies, offer innovative recycling services, establish partnerships, and attract investment funds to grow into a leading waste and recycling services supplier in North America. The company believes it will have to raise an additional $500,000 to expand its operations over the next twelve months.
Management Comments
- We have been focusing on improving other channels of revenue and are pleased to see that the radon channel is leading the growth for 2Q 2024.
Industry Context
The company operates in the waste management and recycling services industry, which is highly competitive and evolving. The company aims to differentiate itself by offering sustainable waste management solutions, innovative recycling services, and strategic acquisitions.
Comparison to Industry Standards
- It is difficult to compare Deep Green Waste & Recycling's results directly to industry standards due to its small size and specific focus on commercial properties.
- Larger waste management companies like Waste Management and Republic Services have significantly higher revenues and profitability due to their scale and diversified service offerings.
- However, Deep Green's focus on sustainable solutions and strategic acquisitions could allow it to carve out a niche in the market.
- The company's ability to secure additional funding and execute its business plan will be crucial for its long-term success.
Legal Proceedings
- A previously reported legal proceeding filed by Owen May and MD Global Partners was dismissed with prejudice on May 30, 2024.
Stakeholder Impact
- Shareholders face potential dilution from future equity issuances.
- Employees' job security is uncertain due to the company's going concern status.
- Customers may be affected by the company's ability to provide services due to its financial challenges.
- Creditors face the risk of non-payment due to the company's high debt levels.
Next Steps
- The company intends to negotiate settlements and establish payment plans with creditors holding default judgments.
- The company intends to either resume waste management services with customers holding accrued customer deposits or refund the advance payments through a repayment plan.
- The company plans to expand its service offerings, acquire profitable waste and recycling services companies, offer innovative recycling services, establish partnerships, and attract investment funds.
- The company expects to seek additional financing in the future.
Key Dates
| Date | Description |
|---|---|
| 1995-08-24 | Company organized as Evader, Inc. |
| 2011 | Deep Green Waste and Recycling, LLC (DGWR LLC) engaged in the waste recycling business |
| 2012-05-25 | Company filed its Foreign Profit Corporation Articles of Domestication to change the domicile of the Company from Nevada to Wyoming. |
| 2015-11-04 | Company filed an Amendment to its Articles of Incorporation to change the name of the Company to Critical Clothing, Inc. |
| 2016-01-01 | Deep Green Waste & Recycling, LLC (the LLC) entered into an Employment Agreement (the Agreement) with David A. Bradford as Chief Operating Officer. |
| 2016-01-01 | Deep Green Waste & Recycling, LLC (the LLC) entered into an Employment Agreement (the Agreement) with Bill Edmonds as Managing Member, President and Chief Financial Officer. |
| 2017-07-17 | Mr. Bradford and the LLC agreed to amend the terms of the Agreement |
| 2017-07-17 | Mr. Edmonds and the LLC agreed to amend the terms of the Agreement |
| 2017-08-24 | Company entered into an Agreement of Conveyance, Transfer and Assignment of Assets and Assumption of Obligations with St. James Capital Management, LLC. |
| 2017-08-24 | Company acquired all the membership units of Deep Green Waste and Recycling, LLC (DGWR LLC) |
| 2017-08-28 | Amendment was filed to change the Company name to Deep Green Waste & Recycling, Inc. |
| 2017-10-01 | Deep Green acquired Compaction and Recycling Equipment, Inc. (CARE) |
| 2017-10-01 | Deep Green acquired Columbia Financial Services, Inc, (CFSI) |
| 2018-08-07 | Company entered into an Agreement of Conveyance, Transfer and Assignment of Subsidiaries and Assumption of Obligations with Mirabile Corporate Holdings, Inc. |
| 2018-08-07 | Company ceased its waste recycling business. |
| 2019-12-04 | Company entered into an agreement with Lloyd Spencer as President and Chief Executive Officer. |
| 2020-01-09 | Company and Lloyd Spencer (the Director) entered into a Board of Directors Services Agreement |
| 2020-01-09 | Company and Bill Edmonds (the Director) entered into a Board of Directors Services Agreement |
| 2020-01-22 | Board of Directors unanimously approved the designation of a series of preferred stock to be known as Series B Convertible Preferred Stock |
| 2020-06-03 | Company issued 6,000 shares of its Series B Convertible Preferred Stock to Bill Edmonds in satisfaction of $ 6,000 loans payable to Mr. Edmonds. |
| 2021-02-08 | Company, through its wholly owned subsidiary DG Research, Inc. (the Buyer), entered into an Asset Purchase Agreement (the Agreement) with Amwaste, Inc. (the Seller). |
| 2021-07-02 | Company entered into a Securities Purchase Agreement (SPA) with Labrys Fund, LP (Labrys). |
| 2021-07-11 | Company's Board unanimously approved an Amendment to our Articles of Incorporation (the Authorized Share Amendment) to increase the number of authorized shares of Common Stock of the Company from 250,000,000 to 500,000,000 and to increase the number of authorized shares of Preferred Stock of the Company from 2,000,000 to 5,000,000 |
| 2021-08-11 | Company entered into a Securities Purchase Agreement (the Agreement) with Jeremy Lyell (the Shareholder) and Lyell Environmental Services, Inc. |
| 2021-10-14 | Company (the Borrower) entered into a Note Purchase Agreement (NPA) with each of BHP Capital NY Inc. and Quick Capital, LLC (together, the Investors) |
| 2021-10-19 | Company closed on the Securities Purchase Agreement (the Agreement) with Jeremy Lyell (the Shareholder). |
| 2022-02-10 | Company's Board unanimously approved an Amendment to our Articles of Incorporation (the Authorized Share Amendment) to increase the number of authorized shares of Common Stock of the Company from 500,000,000 to 1,000,000,000 |
| 2022-02-28 | Company (the Borrower) entered into a Note Purchase Agreement (NPA) with each of BHP Capital NY Inc. and Quick Capital, LLC (together, the Investors) |
| 2022-03-14 | Lloyd T. Spencer, the Company's Chief Executive Officer, Secretary and Director, resigned in his position as Chief Executive Officer. |
| 2022-03-14 | Board of Directors appointed Bill Edmonds as its new Chief Executive Officer. |
| 2022-03-14 | Board of Directors appointed David Bradford to President. |
| 2022-09-17 | Company's Board unanimously approved an Amendment to our Articles of Incorporation (the Authorized Share Amendment) to increase the number of authorized shares of Common Stock of the Company from 1,000,000,000 to 3,000,000,000 |
| 2022-11-30 | Company issued 21,000 shares of its Series B Convertible Preferred Stock to Bill Edmonds in satisfaction of $ 21,000 of a note payable to Bill Edmonds |
| 2023-01-01 | Mr. Edmonds agreed to resume a monthly salary of $ 3,500. |
| 2023-06-16 | BHP Capital agreed to surrender all conversion rights in its currently held convertible notes, surrender for cancellation all unexercised warrants that it acquired in connection with convertible notes, and surrender for cancellation any shares it holds that were acquired by converting notes or exercising related warrants. |
| 2023-06-20 | Company effectuated a 1 for 1,500 shares reverse split which reduced the issued and outstanding shares of common stock from 1,896,216,952 shares to 1,264,165 shares. |
| 2023-07-31 | Lyell Environmental Services, Inc (the Borrower) entered into a Note Purchase Agreement (NPA) with each of BHP Capital NY Inc. and Quick Capital, LLC (together, the Investors). |
| 2023-12-31 | Company extended Mr. Bradfords employment agreement for an additional two-year period . |
| 2023-12-31 | Company extended Mr. Edmonds employment agreement for an additional two-year period . |
| 2023-12-31 | Company extended Mr. Spencers employment agreement for a three-year period . |
| 2024-01-01 | Lyell executed a Lease Agreement with a lessor to rent approximately 4,500 square feet of office and warehouse space in Hermitage, Tennessee. |
| 2024-03-20 | Deep Green Waste & Recycling, Inc. and its subsidiary DG Research Inc. dba AMWASTE (DGRI), along with Tylers Couch, LLC, a single member LLC owned by Bill Edmonds, Deep Greens Chairman and CEO, (collectively, the Sellers) completed the sale of substantially all of the assets of DGRI to Amwaste of Georgia, LLC (Buyer) for a total purchase price of $ 185,000 . |
| 2024-05-29 | Parties executed a Stipulation of Discontinuance With Prejudice to dismiss the case , which was accepted by the Court on May 30, 2024. |
| 2024-06-30 | End of reporting period |
| 2025-09 | Substantial doubt about our ability to continue as a going concern through September 2025. |
Keywords
revenue, net loss, remediation, waste recycling, financial results, Amwaste, debt, going concern, Deep Green Waste & Recycling
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