10-Q: Worldwide NFT Inc. Reports Continued Losses in Q2 2024 as Company Pursues Acquisition Targets

Worldwide NFT Inc. reports ongoing losses for the quarter ended December 31, 2023, as it continues its efforts to identify and acquire a suitable business.

Summary

• Worldwide NFT Inc. reported its financial results for the quarter and six months ended December 31, 2023.
• The company continues to experience losses, with a net loss of $32,063 for the three months ended December 31, 2023, and $116,645 for the six months ended December 31, 2023.
• The company had no revenues for the periods reported.
• Professional fees constituted the primary operating expense, amounting to $32,063 for the three months and $116,645 for the six months ended December 31, 2023.
• As of December 31, 2023, the company had an accumulated deficit of $21,058,462 and a working capital deficit of $391,412.
• The company's auditors have expressed substantial doubt about its ability to continue as a going concern.
• Management is focused on identifying potential acquisition targets to generate revenue and profitability.
• Legal proceedings involving Warwick Calasse are ongoing, with a decision from the Supreme Court anticipated in mid-2024 at the earliest and a civil non-jury trial scheduled for January 13, 2025.
• The company's disclosure controls and procedures were deemed not effective as of December 31, 2023.

Sentiment

Score: 3

Explanation: The document presents a negative outlook due to the company's continued losses, lack of revenue, going concern uncertainty, and ongoing legal issues; however, the company is actively pursuing an acquisition strategy, which offers some potential for future improvement.

Positives

• The company is actively seeking acquisition targets to improve its financial position.
• The company has completed Securities and Exchange Commission filings to become a fully reporting company.
• The company has brought current state regulatory filings to be compliant in the State of Nevada.

Negatives

• The company has reported no revenue for the periods ended December 31, 2023 and 2022.
• The company has incurred net losses of $32,063 and $116,645 for the three and six months ended December 31, 2023, respectively.
• The company has a significant accumulated deficit of $21,058,462 as of December 31, 2023.
• The company has a working capital deficit of $391,412 as of December 31, 2023.
• The company's auditors have expressed substantial doubt about its ability to continue as a going concern.
• The company's disclosure controls and procedures were deemed not effective as of December 31, 2023.

Risks

• The company's ability to continue as a going concern is uncertain.
• The company's operating expenses exceed its revenues and are likely to continue to do so.
• The company's ability to obtain additional capital is uncertain.
• The company faces competition.
• General economic conditions and events could negatively impact the company.
• The company's efforts to develop business may be threatened by government shutdowns, supply and labor issues and resulting economic downturns.
• The company's evolving and unpredictable business model poses a risk.
• The company's ability to recognize revenue sources is a risk.
• The company's management of growth is a risk.
• The company's legal proceedings with Warwick Calasse could have an adverse outcome.

Future Outlook

The company's principal business objective for the next 12 months and beyond is to achieve long-term growth potential through a combination with a business rather than immediate, short-term earnings; the company will not restrict its potential candidate target companies to any specific business, industry or geographical location and, thus, may acquire any type of business or be acquired should such a reasonable opportunity arise.

Management Comments

• Management intends to identify potential merger candidates to provide operating revenues and profitability.
• Future operating expenses will be largely funded by George Sharp until such time as the Company can raise the necessary funding to acquire a business and provide necessary working capital to pay for the operating expenses of the Company.

Industry Context

The company's focus on identifying and acquiring a business is a common strategy for shell companies seeking to revitalize their operations; the NFT market has seen significant volatility, and the company's name may not reflect its future business activities.

Comparison to Industry Standards

• It is difficult to compare Worldwide NFT Inc.'s performance to industry standards due to its lack of operations and ongoing transition.
• Many shell companies face similar challenges in identifying and acquiring suitable businesses.
• The company's reliance on a single individual for funding is not uncommon for small, early-stage companies.

Legal Proceedings

• The Company received a notice of appeal to the Nevada Supreme Court filed May 17, 2022 by Warwick Calasse.
• The Company filed an Amended Complaint against Warwick Calasse in the in the District Court for Clark County, Nevada (Case No.: A-22-858709-B) on September 29, 2022 seeking compensatory and punitive damages on behalf of the Company against Mr. Calasse and alleging that he breached the Consulting Agreement he claims to have entered with the Company and that he breached the fiduciary duties he owed to the Company.

Related Party Transactions

• Accounts payable to related parties and officers are disclosed in the financial statements.

Stakeholder Impact

• Shareholders face the risk of further dilution if the company issues additional shares to raise capital or complete an acquisition.
• The company's ability to continue as a going concern is uncertain, which could impact stakeholders.
• The company's employees and independent contractors may be compensated with stock options or other securities.

Next Steps

• The company will continue to seek potential acquisition targets.
• The company will await a decision from the Supreme Court regarding the legal proceedings with Warwick Calasse.
• The company will prepare for the civil non-jury trial scheduled for January 13, 2025.
• The company will need to raise additional capital to fund its operations.

Key Dates

Keywords

NFT, acquisition, financial statements, going concern, deficit, losses, Worldwide NFT Inc., professional fees