Mon, Sep 23, 9:24 PM (88 days ago)
Formation Minerals, Inc. reported a net income of $289,013 for the quarter ended July 31, 2024, compared to a net loss of $316,796 in the same period last year. Revenue decreased significantly to $36,139 from $75,694, primarily due to lower oil and gas production and the sale of mineral properties. Operating expenses surged to $728,801, driven by increased professional fees related to a merger transaction. The company faced a working capital deficit of $2,460,908, slightly worsening from $2,384,793 at the end of the previous quarter. Total liabilities rose marginally to $2,549,576, influenced by an increase in accounts payable. Cash flow from operating activities was negative at $289,100, but investing activities generated $140,000 from property sales. The merger with Verde Bio Holdings, completed on May 9, 2024, marked a strategic shift towards energy asset acquisition, contributing to substantial changes in equity structure. Despite recent income, ongoing reliance on equity financing raises concerns about the company's ability to sustain operations without additional capital, creating uncertainty about its future financial health.