FORWARD-LOOKING STATEMENTS
Certain matters discussed herein are forward-looking statements. Such
forward-looking statements contained herein involve risks and uncertainties,
including statements as to:
· our future operating results;
· our business prospects;
· our contractual arrangements and relationships with third parties;
· the dependence of our future success on the general economy;
· our possible financings; and
· the adequacy of our cash resources and working capital.
These forward-looking statements can generally be identified as such because the
context of the statement will include words such as we “believe,” “anticipate,”
“expect,” “estimate” or words of similar meaning. Similarly, statements that
describe our future plans, objectives or goals are also forward-looking
statements. Such forward-looking statements are subject to certain risks and
uncertainties which are described in close proximity to such statements, and
which could cause actual results to differ materially from those anticipated as
of the date of this report. Shareholders, potential investors and other readers
are urged to consider these factors in evaluating the forward-looking statements
and are cautioned not to place undue reliance on such forward-looking
statements. The forward-looking statements included herein are only made as of
the date of this report, and we undertake no obligation to publicly update such
forward-looking statements to reflect subsequent events or circumstances.
General Overview
We were incorporated under the laws of the
2000
development stage company in the business of mining and exploration. On
2014
we changed our name from
In connection with the reverse merger, we became a food manufacturing and
product company, and in
Pancakes to market and sell “Nate’s Homemade,” exclusively throughout the world.
Our Current Business
The Company is engaged in “Bitcoin Mining” – i.e. the process by which Bitcoins
are created resulting in new blocks being added to the blockchain and new
Bitcoins being issued to the miners. The Company has purchase and maintain ASIC
(application-specific integrated circuit) computers – computers specifically
designed for cryptocurrency mining – that are used for Bitcoin Mining. We have
placed this Bitcoin Mining equipment with a 3rd party datacenter or farms (often
referred as a “Co-Location”) that powers and operates our Bitcoin Mining
equipment for a fee. We currently generate revenues through receiving Bitcoin
from our Bitcoin Mining equipment.
Bitcoin Miners engage in a set of prescribed complex mathematical calculations
in order to add a block to the blockchain and thereby confirm cryptocurrency
transactions included in that block’s data. Miners that are successful in adding
a block to the blockchain are automatically awarded a fixed number of Bitcoins
for their effort. The Company will only mine Bitcoin. The Company has executed
two 270 days and 200 days lease agreements for Bitmain’s S-17s and T-17s for
Bitcoin Mining Equipment. The Company is actively in discussions with
manufactures and resellers to acquire additional bitcoin mining equipment and
capacity. The Company’s initial goal is to acquire 25,000 terrahash in mining
capacity in the next 12 months. Terahashes are the unit used to measure speed of
the mining hardware mining cryptocurrencies, with a TH/s equalling one trillion
hash calculations computed in one second. Open-source calculators are available,
such as NovaBlock, that allow for the calculation of expected revenue based on
TH/s.
17
Table of Contents
Our food development division licenses, develops and manufactures food products.
The Company’s Board of Directors has voted to cease product manufacturing and
development of new products for its food development division. We are, however,
continually exploring options to license our developed product, a ready-to-use,
pre-mixed pancake and waffle batter delivered in a pressurized can. We are also
exploring options on monetizing our proprietary blend of pancake and waffle dry
mix. Our current product line consists of the original flavor of pancake and
waffle mix and three additional flavors, Banana, Blueberry and Strawberry. The
flavors can be found at www.natesfoodco.com. and www.sh-mallow.com.
Results of Operations
The following summary of our results of operations should be read in conjunction
with our unaudited condensed financial statements for the three and six months
ended
Our operating results for the three and six months ended
2021, and the changes between those periods for the respective items are
summarized as follows
Three Months EndedNovember 30, 2022 , compared to the Three Months EndedNovember 30, 2021 . Three Months Ended November 30, 2022 2021 Change % Revenue$ 2,881 $ 21,204 $ (18,323 ) (86 %) Cost of revenue 7,646 44,660 (37,014 ) (83 %) Gross loss (4,765 ) (23,456 ) 18,691 80 % Operating expenses (57,823 ) (36,920 ) (20,903 ) (57 %) Change in fair market value of (515 derivative (47,000 ) 11,333 (58,333 ) %) Interest expense (30,146 ) (24,546 ) (5,600 ) 23 % Gain on disposal of digital currency 3,438 - 3,438 100 % Impairment loss on digital currency (4.231 ) (976 ) (3,255 ) (333 %) Net Loss$ (140,527 ) $ (74,565 ) $ (65,962 ) (88 %) Revenue
Our Company generated
for the three months ended
commenced the mining of Bitcoin in
Cost of Revenue
The cost of digital currency mining revenue was
months ended
of electricity and other co-location hosting fees, which are remitted in Bitcoin
and cash payments for equipment leases.
Operating Expenses
During the three months ended
administrative expenses of
months ended
predominantly from professional and other fees related to our reporting
requirements and general administrative expenses.
Other income (expense)
During the three months ended
market value of derivatives of
sale of digital currency of
impairment loss on digital currency
the three months ended
30,2022
related to first quarter (
currency.
18
Table of Contents
Six Months Ended
30, 2021
Our operating results for the six months endedNovember 30, 2022 and 2021, and the changes between those periods for the respective items are summarized as follows: Six Months Ended November 30, 2022 2021 Change % Revenue$ 8,084 $ 21,204 $ (13,120 ) (62 %) Cost of revenue 24,037 44,660 (20,623 ) (46 %) Gross loss (15,953 ) (23,456 ) 7,503 (32 %) Operating expenses (86,301 ) (45,965 ) (40,336 ) 88 % Change in fair market value of (104 derivative (17,080 ) 415,795 (432,875 ) %) Interest expense (73,935 ) (29,599 ) 44,336 150 % Loss on disposal of digital currency (2,304 ) - (2,304 ) -
Impairment loss on digital currency (6,191 ) (976 ) (5,215 ) 534 %
Net Income (Loss)
$ (201,764 ) $ 315,799 $ (517,563 ) (164 %) Revenue
Our Company generated
for the six months ended
commenced the mining of Bitcoin in
Cost of Revenue
The cost of digital currency mining revenue was
months ended
of electricity and other co-location hosting fees, which are remitted in Bitcoin
and cash payments for equipment leases.
Operating Expenses
During the…
Read More:NATE’S FOOD CO. Management’s Discussion and Analysis of Financial Condition or Plan of
Operation (form 10-Q)
2023-01-23 22:31:08
