DSS INC
For the period ended Jun 30, 2024. Filed Aug 13, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 13, 2024
DSS$0.49+6.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-14.
0001493152-24-019277
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-13.
0001493152-24-031643
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 46 previous paragraphs and 47 current paragraphs.
28 unchanged; 17 reworded; 1 added; 1 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 6 previous and 5 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (1)
Current report
Professional fees decreased 26% for six months ended June 30, 2024 as compared to 2023 due primarily to primarily due to efforts taken to decrease these cost primarily at the Company’s Impact Bio subsidiary in anticipation of its IPO.
Removed paragraphs (1)
Previous report
Professional fees increased 77% for three months ended March 31, 2024 as compared to 2023 due primarily to primarily due to increases in accounting fees for tax return preparation as well as audit fees associated with the required SEC reporting for ImpactBio offset by settlement of disputed legal fees of approximately $743,000 during the first quarter of 2023.
Reworded paragraphs (17)
Previous wording
Results of operations for the three months ended March 31, 2024, as compared to the three months ended March 31, 2023.
Current wording
Results of operations for the three and six months ended June 30, 2024, as compared to the three and six months ended June 30, 2023.
Previous wording
For the three months ended March 31, 2024, total revenue decreased 68% as compared to the three months ended March 31, 2023. Revenues from the sale of Printed products decreased 50% during three months ended March 31, 2024, as compared to the same period in 2023 due primarily to orders expected to ship during the 4 th quarter 2022 being pushed to the 1st quarter 2023. The decreases in Rental income of 76% for the three months ended March 31, 2024 as compared to the three months ended March 31, 2023 is driven by the tenants at AMRE LifeCare being unable to make rental payments in 2024. The decreases in Net investment income approximating 19% for the three months ended March 31, 2024 as compared to the three months ended March 31, 2023 is due to a number of loans made going on non-accrual as borrowers have struggled to make expect payments. The Company’s Direct Marketing revenues decreased three months ended March 31, 2024 as compared to the three months ended March 31, 2023 is due to the Deconsolidation of SHRG as described in Note 1.
Current wording
For the six months ended June 30, 2024, total revenue decreased 58% as compared to the six months ended June 30, 2023. Revenues from the sale of Printed products decreased 32% due primarily to orders expected to ship during the 4 th quarter 2022 being pushed to the 1st quarter 2023. The decreases in Rental income of 74% is driven by the tenants at AMRE LifeCare being unable to make rental payments in 2024. The decreases in Net investment income approximating 57% is due to a number of loans made going on non-accrual as borrowers have struggled to make expect payments. The Company’s Direct Marketing revenues decreased 100% is due to the Deconsolidation of SHRG as described in Note 1.
Previous wording
Costs of revenue include all direct costs of the Company’s printed products, including its packaging and printing sales and its direct marketing sales, materials, direct labor, transportation, and manufacturing facility costs. In addition, this category includes all direct costs associated with the Company’s technology sales, services and licensing including hardware and software that are resold, third-party fees, and fees paid to inventors or others because of technology licenses or settlements, if any. Cost of revenue for our Securities operating segments is comprised mainly of our REIT line of business and includes all direct cost associated with the maintenance and upkeep of the related facilities, depreciation, amortization, and the costs to acquire the facilities. Our Commercial Lending operating segment has costs of revenue associated with the impairment of notes receivable for those amounts at risk of collection. Total costs of revenue decreased 42% for three months ended March 31, 2024 as compared to 2023 is primarily related to the Deconsolidation of SHRG as described in Note 1. Also, cost of revenue decreased at Premier for the same time period due to the decrease in product shipped.
Current wording
Costs of revenue include all direct costs of the Company’s printed products, including its packaging and printing sales and its direct marketing sales, materials, direct labor, transportation, and manufacturing facility costs. In addition, this category includes all direct costs associated with the Company’s technology sales, services and licensing including hardware and software that are resold, third-party fees, and fees paid to inventors or others because of technology licenses or settlements, if any. Cost of revenue for our Securities operating segments is comprised mainly of our REIT line of business and includes all direct cost associated with the maintenance and upkeep of the related facilities, depreciation, amortization, and the costs to acquire the facilities. Our Commercial Lending operating segment has costs of revenue associated with the impairment of notes receivable for those amounts at risk of collection. Total costs of revenue decreased 20% for six months ended June 30, 2024 as compared to 2023 is primarily related to the Deconsolidation of SHRG as described in Note 1. Also, cost of revenue decreased at Premier for the same time period due to the decrease in product shipped.
Previous wording
Sales, general and administrative compensation costs, excluding stock-based compensation, decreased 76% for three months ended March 31, 2024 as compared to 2023 is primarily related to the Deconsolidation of SHRG as described in Note 1.
Current wording
Sales, general and administrative compensation costs, excluding stock-based compensation, decreased 62% for six months ended June 30, 2024 as compared to 2023 is primarily related to the Deconsolidation of SHRG as described in Note 1.
Previous wording
Sales and marketing which include internet and trade publication advertising, travel and entertainment costs, sales-broker commissions, and trade show participation expenses. Sales and marketing decreased 73% three months ended March 31, 2024 as compared to 2023 due primarily to the Deconsolidation of SHRG as described in Note 1.
Current wording
Sales and marketing which include internet and trade publication advertising, travel and entertainment costs, sales-broker commissions, and trade show participation expenses. Sales and marketing decreased 69% during the six months ended June 30, 2024 as compared to 2023 due primarily to the Deconsolidation of SHRG as described in Note 1.
Previous wording
Rent and utilities decreased 42% primarily due to end of the lease in Tennessee for AMRE office space and California for the Company’s DSS Wealth Management subsidiary as well as the deconsolidation of SHRG. primarily due to end of the lease in Tennessee for AMRE office space and California for the Company’s DSS Wealth Management subsidiary as well as the deconsolidation of SHRG.
Current wording
Rent and utilities decreased 15% during the six months ended June 30, 2024 as compared to 2023 primarily due to end of the lease in Tennessee for AMRE office space and California for the Company’s DSS Wealth Management subsidiary as well as the deconsolidation of SHRG.
Previous wording
Research and development costs represent costs consisting primarily of independent, third-party testing of the various properties of each technology the Company owns possesses as well as research on new technologies. These costs decreased 72% the three months ended March 31, 2024 as compared to March 31, 2023, due primarily to the cessation of the Company’s research and development contract with GRDG at the end of 2023.
Current wording
Research and development costs represent costs consisting primarily of independent, third-party testing of the various properties of each technology the Company owns possesses as well as research on new technologies. These costs decreased 89% the six months ended June 30, 2024 as compared to June 30, 2023, due primarily to the cessation of the Company’s research and development contract with GRDG at the end of 2023.
Previous wording
Other operating expenses consist primarily of equipment maintenance and repairs, office supplies, IT support, and insurance costs. During the three months ended March 31, 2024 as compared to March 31, 2023, the fluctuation is due primarily to the Deconsolidation of SHRG as described in Note 1.
Current wording
Other operating expenses consist primarily of equipment maintenance and repairs, office supplies, IT support, and insurance costs. During the six months ended June 30, 2024 as compared to June 30, 2023, the fluctuation is due primarily to the Deconsolidation of SHRG as described in Note 1.
Previous wording
Other income (expense)for the three months ended March 31, 2024 as compared to 2023 increased 132% due primarily to cost incurred in 2023 regarding the Company’s distribution agreement with BioMed Technologies.
Current wording
Other incomefor the six months ended June 30, 2024 as compared to 2023 decreased 78% due primarily to income incurred in 2023 regarding the Company’s distribution agreement with BioMed Technologies.
Previous wording
Interest expenses decreased 81% during the three months ended March 31, 2024, as compared to the same period in 2023, due to decreasing debt balances.
Current wording
Interest expenses decreased 51% during the six months ended June 30, 2024, as compared to the same period in 2023, due to decreasing debt balances.
Previous wording
Loss on investments consists of net realized losses on marketable securities which are recognized as the difference between the purchase price and sale price of the common stock investment, and net unrealized losses on marketable securities which are recognized on the change in fair market value on our common stock investment.
Current wording
Loss on investments consists of net realized losses on marketable securities which are recognized as the difference between the purchase price and sale price of the common stock investment, and net unrealized losses on marketable securities which are recognized on the change in fair market value on our common stock investment. The decrease in loss on investment for the six months ended June 30, 2024 as compared to 2023 is driven by the deconsolidation of SHRG which resulted in a loss of approximately $29,196,000. See Note 1.
Previous wording
Loss on equity method investmentis the Company’s prorated portion of earnings on its investments treated under the equity method of account for the three months ended March 31, 2024 as compared to 2023
Current wording
Loss on equity method investmentis the Company’s prorated portion of earnings on its investments treated under the equity method of account for the six months ended June 30, 2024 as compared to 2023.
Previous wording
For the three months ended March 31, 2024 the Company recorded net losses of $5,109,000 as compared to net losses of $8,633,000 for the same period in 2023. The decrease in net loss is driven by the Deconsolidation of SHRG as described in Note 1.
Current wording
For the six months ended June 30, 2024 the Company recorded net losses of $46,357,000 as compared to net losses of $10,063,000 for the same period in 2023. The decrease in net loss is driven by the Deconsolidation of SHRG as described in Note 1.
Previous wording
The Company has historically met its liquidity and capital requirements primarily through the sale of its equity securities and debt financing. As of March 31, 2024 the Company had cash of approximately $9.3 million. As of March 31, 2024, the Company believes that it has sufficient cash to meet its cash requirements for at least the next 12 months from the filing date of this Annual Report. In addition, the Company believes that it will have access to sources of capital from the sale of its equity securities and debt financing. The deconsolidation of SHRG and sale of HWH Holdings, Inc, two companies with historical losses, also is expected to improve future cash flows.
Current wording
The Company has historically met its liquidity and capital requirements primarily through the sale of its equity securities and debt financing. As of June 30, 2024 the Company had cash of approximately $10.7 million. As of June 30, 2024, the Company believes that it has sufficient cash to meet its cash requirements for at least the next 12 months from the filing date of this Annual Report. In addition, the Company believes that it will have access to sources of capital from the sale of its equity securities and debt financing. The deconsolidation of SHRG and sale of HWH Holdings, Inc, two companies with historical losses, also is expected to improve future cash flows.
Previous wording
Net cash used from operating activities was $2,150,000 for the three months ended March 31, 2024 as compared to $14,199,000 for three months ended March 31, 2023. This fluctuation is driven by decreases in net loss approximating $3,524,000.
Current wording
Net cash used by operating activities was $5,574,000 for the six months ended June 30, 2024 as compared to $19,715,000 for six months ended June, 2023. This fluctuation is driven by decreases in net loss, after reconciling items, approximating $756,000. Also, the Company paid litigation losses during the 1 st quarter of 2023 of approximately $8,750,000.
Previous wording
Net cash provided by investing activities was $5,097,000 for the three months ended March 31, 2024 as compared to net cash provided by investing activities of $11,537,000 for the three months ended March 31, 2023. This fluctuation is driven by the sale of marketable securities approximating $11,330,000 during 2023 versus $1,160,000 during 2024. This is offset by receipts on Notes receivable of $3,971,000 in 2024 versus $764,000 in 2023.
Current wording
Net cash provided by investing activities was $8,776,000 for the six months ended June 30, 2024 as compared to net cash provided by investing activities of $13,376,000 for the six months ended June 30, 2023. This fluctuation is driven by the sale of marketable securities approximating $11,330,000 during 2023 versus purchases of $379,000 during 2024. This is offset by receipts on Notes receivable of $4,044,000 in 2024 versus $2,327,000 in 2023.
Previous wording
Net cash used from financing activities was $310,000 for the three months ended March 31, 2024 as compared to net cash used from financing activities of $2,896,000 for the three months ended March 31, 2023. This variance is driven by payments toward long term debt of $1,399,000 in 2024 versus $4,002,000 in 2023.
Current wording
Net cash provided by financing activities was $902,000 for the six months ended June 30, 2024 as compared to net cash used by financing activities of $2,918,000 for the six months ended June 30, 2023. This variance is driven by payments toward long term debt of $1,269,000 in 2024 versus $5,519,000 in 2023.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
For the three months ended June 30, 2024, total revenue decreased 42% as compared to the three months ended June 30, 2023. The decreases in Rental income of 72% is driven by the tenants at AMRE LifeCare being unable to make rental payments in 2024. The decreases in Net investment income approximating 79% is due to a number of loans made going on non-accrual as borrowers have struggled to make expect payments. The Company’s Direct Marketing revenues decreased 100% is due to the Deconsolidation of SHRG as described in Note 1.