mos Health (COSM) - 2024 Q2 - Quarterly Report

Financial Performance - Revenue for Q2 2024 was $13,206,717, representing a 6.82$12,363,429 in Q2 2023[174] - Revenue for the first half of 2024 was $27,791,190, an increase of 12.45$24,713,206 in the same period of 2023[174] - The net loss for Q2 2024 was $2,590,711, compared to a net loss of$981,530 in Q2 2023[174] - The net loss for the first half of 2024 was $4,457,401, up from a net loss of$1,441,393 in the same period of 2023[174] - The Company had a net loss of $4,457,401 for the six months ended June 30, 2024, with total revenue of$27,791,190[189] Revenue Drivers - The increase in revenue is attributed to the wholesale revenue stream and the contribution from the acquisition of Cana[174] - The company completed the acquisition of Cana for €800,000 and 46,377 shares of common stock valued at $800,000[170] - The acquisition of Bikas is projected to increase annual revenue by more than$10 million and enhance gross margins[172] - The company acquired Cloudscreen, an AI-powered platform for drug repurposing, for a total price of $637,080[173] Cost and Expenses - The Company reported a cost of goods sold of$12,349,469 for the three months ended June 30, 2024, an increase of 8.96% compared to $11,416,595 for the same period in 2023[175] - Gross profit decreased by 18.97$767,248 for the three months ended June 30, 2024, down from $946,834 in 2023, primarily due to decreased sales in high-margin revenue streams[177] - Operating expenses for the three months ended June 30, 2024, were$2,502,026, a decrease of 7.21% compared to $2,576,465 in 2023, with general and administrative costs decreasing by 30.48$8,593,711, down from 12,285,310 as of December 31, 2023[184] - The company intends to strengthen working capital and invest in R&D, sales, and marketing, although actual expenditures may differ from planned allocations due to industry uncertainties[206] - The Company raised 649,039 from the sale of 901,488 shares of common stock during the six months ended June 30, 2024[187] Strategic Initiatives - The Company plans to expand its product portfolio to 150 SKUs by the end of 2023, focusing on various customer needs and advanced formulations[193] - The Company intends to enhance its geographic expansion in the EU, Asia, USA, and Canada through exclusive distributors and acquisitions of nutraceutical companies[193] - Management plans to vertically integrate the supply chain distribution network and evaluate acquisition targets to expand distribution[191] - The company plans to actively pursue acquisitions to enhance its distribution network, focusing on discounted assets through business combinations or joint ventures[200] - The company aims to expand its R&D division to develop new patented pharmaceuticals and innovative nutraceutical products, fostering organic growth through enhanced marketing efforts[200] Market Opportunities - The pharmaceutical sector presents significant growth potential in the European market, contingent on aligning services, pricing, and quality with customer requirements[198] - The company is experiencing strong demand for its branded nutraceuticals, with positive feedback from major health events[202] - Sky Premium Life products are being sold in over 1,600 stores across 18 countries, generating approximately 1 billion in annual revenue for Holland & Barrett, a key retailer[203] - The company is launching Mediterranation, a premium food supplements brand, utilizing organic herbs and plant extracts from the Mediterranean region[204] - The global baby food market is valued at 102.90 billion, presenting an opportunity for the relaunch of the Bio-Bebe brand[205] - The global antiseptic and disinfectant market is worth $29 billion, with the company positioned to capitalize on this through the expansion of the C-Sept brand[205] Internal Controls and Governance - The company is addressing material weaknesses in its internal controls and plans to complete remediation by December 31, 2024[217] - The internal control structure currently lacks proper segregation of duties and multiple levels of review and oversight[218] - A new financial reporting application is being assessed to enhance IT General Controls and improve financial reporting efficiency[219] - The Audit Committee is responsible for overseeing the financial reporting and accounting processes, and it meets at least four times a year[223] - There have been no changes in internal control over financial reporting that materially affect the Company[220] - The Audit Committee maintains direct communication with independent auditors and is authorized to investigate any matters brought to its attention[222] - The Company is updating its organizational chart to better allocate roles and responsibilities among personnel[218] - Management reviews bank reconciliations and discrepancies between the general ledger and bank statements to ensure timely reporting[219] - The Audit Committee includes three independent directors and is chaired by Dr. Anastasios Aslidis[221] - The Company plans to enhance its IT risk management and control design to address existing weaknesses[217]