Exhibit 99.1
CORRECTING and REPLACING Ault Global Holdings Reports Third Quarter 2021 Results
CORRECTION...by Ault Global Holdings, Inc.
LAS VEGAS--(BUSINESS WIRE)-- Please replace the release dated November 19, 2021 with the following corrected version due to multiple revisions to all financial tables. Additionally, the first number of the first sentence under the "Ault Alliance" header in the "Revenues" section should read: $272,000 (instead of: $238,000). The first sentence under the "Gross margins" section should read: Gross margins were negative $36.0 million or 117.1% for the three months ended September 30, 2021 compared to 34.2% for the three months ended September 30, 2020 (instead of: Gross margins were negative $36.0 million or 117.1% for the three months ended September 30, 2021 compared to 35.3% for the three months ended September 30, 2020).
The updated release reads:
AULT GLOBAL HOLDINGS REPORTS THIRD QUARTER 2021 RESULTS
Ault Global Holdings, Inc. (NYSE American: DPW) a diversified holding company (the “Company”), today announced its financial results for the three and nine months ended September 30, 2021.
Nine months ended September 30, 2021 highlights:
| · | Revenue of $44.6 million, an increase of 167% from $16.7 million in the prior nine-month period; |
| · | Revenue from lending and trading activities of $19.6 million due to the allocation of capital to DP Lending; |
| · | Revenues from our trading activities during the nine months ended September 30, 2021 included significant net gains on equity securities, including unrealized gains and losses from market price changes. These gains and losses have caused and will continue to cause, significant volatility in our periodic earnings. |
| · | Revenue from lending and trading activities includes an approximate $6.4 million unrealized gain from the Company’s investment in Alzamend Neuro, Inc. (Nasdaq: ALZN) (“Alzamend”), an early clinical-stage biopharmaceutical company focused on developing novel products for the treatment of neurodegenerative diseases and psychiatric disorders; |
| · | Revenue from cryptocurrency mining of $693,000 as the Company resumed cryptocurrency mining operations during March 2021; and |
| · | Net income of $1.3 million compared to a net loss of $24.7 million in the prior nine-month period. |
Three months ended September 30, 2021 highlights:
| · | Revenue decreased $36.5 million to negative $30.8 million from positive revenue of $5.7 million in the prior third fiscal quarter; |
| · | Revenue from lending and trading activities includes unrealized gains and losses and, due to stock price volatility, can result in the Company reporting negative revenue. For the three months ended September 30, 2021, the Company reported negative revenue from lending and trading activities of $(38.9) million, including a $(33.4) million unrealized loss from the Company’s investment in Alzamend; |
| · | Revenue from cryptocurrency mining of $272,000 as the Company resumed cryptocurrency mining operations during March 2021; |
| · | Net loss of $42.9 million for the quarter; |
| · | Positive working capital of $93.9 million; |
| · | Total assets of $225.7 million; and |
| · |
September 30, | ||||||||||||||||
About Ault Global Holdings, Inc.
Forward-Looking Statements
This press release contains “forward looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements generally include statements that are predictive in nature and depend upon or refer to future events or conditions, and include words such as “believes,” “plans,” “anticipates,” “projects,” “estimates,” “expects,” “intends,” “strategy,” “future,” “opportunity,” “may,” “will,” “should,” “could,” “potential,” or similar expressions. Statements that are not historical facts are forward-looking statements. Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties. Forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update any of them publicly in light of new information or future events. Actual results could differ materially from those contained in any forward-looking statement as a result of various factors. More information, including potential risk factors, that could affect the Company’s business and financial results are included in the Company’s filings with the U.S. Securities and Exchange Commission, including, but not limited to, the Company’s Forms 10-K, 10-Q and 8-K. All filings are available at www.sec.gov and on the Company’s website at www.AultGlobal.com.
Contacts:
IR@AultGlobal.com or 1-888-753-2235
AULT GLOBAL HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
| September 30, | December 31, | |||||||
| 2021 | 2020 | |||||||
| ASSETS | ||||||||
| CURRENT ASSETS | ||||||||
| Cash and cash equivalents | $ | 44,047,000 | $ | 18,680,000 | ||||
| Marketable equity securities | 49,931,000 | 2,563,000 | ||||||
| Accounts receivable | 5,115,000 | 3,852,000 | ||||||
| Accounts and other receivable, related party | 1,196,000 | 1,196,000 | ||||||
| Accrued revenue | 1,857,000 | 1,696,000 | ||||||
| Inventories | 3,842,000 | 3,374,000 | ||||||
| Prepaid expenses and other current assets | 7,987,000 | 2,988,000 | ||||||
| TOTAL CURRENT ASSETS | 113,975,000 | 34,349,000 | ||||||
| Intangible assets, net | 4,069,000 | 4,390,000 | ||||||
| Goodwill | 9,606,000 | 9,646,000 | ||||||
| Property and equipment, net | 29,550,000 | 2,123,000 | ||||||
| Right-of-use assets | 5,201,000 | 4,318,000 | ||||||
| Investment in promissory notes, related parties | 19,194,000 | 10,668,000 | ||||||
| Investments in common stock and warrants, related parties | 24,911,000 | 6,139,000 | ||||||
| Investments in debt and equity securities | 9,924,000 | 262,000 | ||||||
| Investment in limited partnership | 1,869,000 | 1,869,000 | ||||||
| Loans receivable | 5,877,000 | 750,000 | ||||||
| Other investments, related parties | 780,000 | 803,000 | ||||||
| Other assets | 765,000 | 326,000 | ||||||
| TOTAL ASSETS | $ | 225,721,000 | $ | 75,643,000 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| CURRENT LIABILITIES | ||||||||
| Accounts payable and accrued expenses | $ | 9,361,000 | $ | 10,579,000 | ||||
| Accounts payable and accrued expenses, related party | 26,000 | 36,000 | ||||||
| Operating lease liability, current | 1,014,000 | 524,000 | ||||||
| Revolving credit facility | - | 125,000 | ||||||
| Notes payable, net | 1,697,000 | 4,048,000 | ||||||
| Notes payable, related parties | - | 188,000 | ||||||
| Convertible notes payable, related party | - | 400,000 | ||||||
| Warrant liability | 4,322,000 | 4,192,000 | ||||||
| Other current liabilities | 3,608,000 | 1,790,000 | ||||||
| TOTAL CURRENT LIABILITIES | 20,028,000 | 21,882,000 | ||||||
AULT GLOBAL HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (continued)
(Unaudited)
| September 30, | December 31, | |||||||
| 2021 | 2020 | |||||||
| LONG-TERM LIABILITIES | ||||||||
| Operating lease liability, non-current | 4,265,000 | 3,855,000 | ||||||
| Notes payable | - | 336,000 | ||||||
| Notes payable, related parties | - | 52,000 | ||||||
| Convertible notes payable | 447,000 | 386,000 | ||||||
| TOTAL LIABILITIES | 24,740,000 | 26,511,000 | ||||||
| COMMITMENTS AND CONTINGENCIES | ||||||||
| STOCKHOLDERS’ EQUITY | ||||||||
| Series A Convertible Preferred Stock, $25.00 stated value per share, $0.001 par value – 1,000,000 shares authorized; 7,040 shares issued and outstanding at September 30, 2021 and December 31, 2020 (redemption amount and liquidation preference of $176,000 as of September 30, 2021 and December 31, 2020) | - | - | ||||||
| Series B Convertible Preferred Stock, $10 stated value per share, share, $0.001 par value – 500,000 shares authorized; 125,000 shares issued and outstanding at September 30, 2021 and December 31, 2020 (liquidation preference of $1,250,000 at September 30, 2021 and December 31, 2020) | - | - | ||||||
| Class A Common Stock, $0.001 par value – 500,000,000 shares authorized; 63,346,921 and 27,753,562 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively | 63,000 | 28,000 | ||||||
| Class B Common Stock, $0.001 par value – 25,000,000 shares authorized; nil shares issued and outstanding at September 30, 2021 and December 31, 2020 | - | - | ||||||
| Additional paid-in capital | 331,886,000 | 171,396,000 | ||||||
| Accumulated deficit | (120,066,000 | ) | (121,396,000 | ) | ||||
| Accumulated other comprehensive loss | (9,631,000 | ) | (1,718,000 | ) | ||||
| Treasury stock, at cost | (2,773,000 | ) | - | |||||
| TOTAL AULT GLOBAL HOLDINGS STOCKHOLDERS’ EQUITY | 199,479,000 | 48,310,000 | ||||||
| Non-controlling interest | 1,502,000 | 822,000 | ||||||
| TOTAL STOCKHOLDERS’ EQUITY | 200,981,000 | 49,132,000 | ||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 225,721,000 | $ | 75,643,000 | ||||
AULT GLOBAL HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited)
| For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
| Revenue | $ | 7,803,000 | $ | 5,705,000 | $ | 24,272,000 | $ | 16,709,000 | ||||||||
| Revenue, cryptocurrency mining | 272,000 | - | 693,000 | - | ||||||||||||
| Revenue, lending and trading activities | (38,869,000 | ) | (29,000 | ) | 19,615,000 | (27,000 | ) | |||||||||
| Total revenue | (30,794,000 | ) | 5,676,000 | 44,580,000 | 16,682,000 | |||||||||||
| Cost of revenue | 5,271,000 | 3,736,000 | 16,657,000 | 11,085,000 | ||||||||||||
| Gross profit (loss) | (36,065,000 | ) | 1,940,000 | 27,923,000 | 5,597,000 | |||||||||||
| Operating expenses | ||||||||||||||||
| Research and development | 524,000 | 469,000 | 1,657,000 | 1,372,000 | ||||||||||||
| Selling and marketing | 1,993,000 | 260,000 | 4,740,000 | 893,000 | ||||||||||||
| General and administrative | 11,292,000 | 2,836,000 | 24,376,000 | 8,656,000 | ||||||||||||
| Total operating expenses | 13,809,000 | 3,565,000 | 30,773,000 | 10,921,000 | ||||||||||||
| Loss from continuing operations | (49,874,000 | ) | (1,625,000 | ) | (2,850,000 | ) | (5,324,000 | ) | ||||||||
| Other income (expenses) | ||||||||||||||||
| Interest income | 125,000 | 102,000 | 176,000 | 139,000 | ||||||||||||
| Accretion of discount on note receivable, related party | 4,210,000 | - | 4,210,000 | - | ||||||||||||
| Interest expense | (140,000 | ) | (2,366,000 | ) | (475,000 | ) | (4,414,000 | ) | ||||||||
| Change in fair value of marketable equity securities | (750,000 | ) | (29,000 | ) | (705,000 | ) | (58,000 | ) | ||||||||
| Realized gain on marketable securities | 30,000 | - | 428,000 | - | ||||||||||||
| Gain (loss) on extinguishment of debt | - | (12,823,000 | ) | 929,000 | (13,298,000 | ) | ||||||||||
| Change in fair value of warrant liability | 259,000 | - | (130,000 | ) | (6,000 | ) | ||||||||||
| Total other income (expenses), net | 3,734,000 | (15,116,000 | ) | 4,433,000 | (17,637,000 | ) | ||||||||||
| Income (loss) from continuing operations before income taxes | (46,140,000 | ) | (16,741,000 | ) | 1,583,000 | (22,961,000 | ) | |||||||||
| Income tax (provision) benefit | 3,366,000 | 6,000 | (144,000 | ) | 18,000 | |||||||||||
| Net income (loss) from continuing operations | (42,774,000 | ) | (16,735,000 | ) | 1,439,000 | (22,943,000 | ) | |||||||||
| Net loss from discontinued operations, net of taxes | - | - | - | (1,698,000 | ) | |||||||||||
| Net income (loss) | (42,774,000 | ) | (16,735,000 | ) | 1,439,000 | (24,641,000 | ) | |||||||||
| Net loss attributable to non-controlling interest | (96,000 | ) | - | (93,000 | ) | - | ||||||||||
| Net income (loss) attributable to Ault Global Holdings | (42,870,000 | ) | (16,735,000 | ) | 1,346,000 | (24,641,000 | ) | |||||||||
| Preferred dividends | (4,000 | ) | (3,000 | ) | (13,000 | ) | (10,000 | ) | ||||||||
| Net income (loss) available to common stockholders | $ | (42,874,000 | ) | $ | (16,738,000 | ) | $ | 1,333,000 | $ | (24,651,000 | ) | |||||
| Basic net income (loss) per common share: | ||||||||||||||||
| Continuing operations | $ | (0.73 | ) | $ | (1.69 | ) | $ | 0.03 | $ | (3.40 | ) | |||||
| Discontinued operations | - | - | - | (0.25 | ) | |||||||||||
| Net income (loss) per common share | $ | (0.73 | ) | $ | (1.69 | ) | $ | 0.03 | $ | (3.65 | ) | |||||
| Diluted net income (loss) per common share: | ||||||||||||||||
| Continuing operations | $ | (0.73 | ) | $ | (1.69 | ) | $ | 0.03 | $ | (3.40 | ) | |||||
| Discontinued operations | - | - | - | (0.25 | ) | |||||||||||
| Net income (loss) per common share | $ | (0.73 | ) | $ | (1.69 | ) | $ | 0.03 | $ | (3.65 | ) | |||||
| Weighted average basic common shares outstanding | 58,987,000 | 9,879,000 | 49,714,000 | 6,759,000 | ||||||||||||
| Weighted average diluted common shares outstanding | 58,987,000 | 9,879,000 | 50,145,000 | 6,759,000 | ||||||||||||
| Comprehensive loss | ||||||||||||||||
| Net income (loss) available to common stockholders | $ | (42,874,000 | ) | $ | (16,738,000 | ) | $ | 1,333,000 | $ | (24,651,000 | ) | |||||
| Other comprehensive income (loss) | ||||||||||||||||
| Foreign currency translation adjustment | (182,000 | ) | 44,000 | (141,000 | ) | (8,000 | ) | |||||||||
| Net unrealized gain (loss) on derivative securities of related party | (4,849,000 | ) | 1,561,000 | (7,773,000 | ) | 1,080,000 | ||||||||||
| Other comprehensive income (loss) | (5,031,000 | ) | 1,605,000 | (7,914,000 | ) | 1,072,000 | ||||||||||
| Total comprehensive loss | $ | (47,905,000 | ) | $ | (15,133,000 | ) | $ | (6,581,000 | ) | $ | (23,579,000 | ) | ||||
AULT GLOBAL HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
| For the Nine Months Ended September 30, | ||||||||
| 2021 | 2020 | |||||||
| Cash flows from operating activities: | ||||||||
| Net income (loss) | $ | 1,439,000 | $ | (24,641,000 | ) | |||
| Less: Net loss from discontinued operations | - | (1,698,000 | ) | |||||
| Net income (loss) from continuing operations | 1,439,000 | (22,943,000 | ) | |||||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation | 711,000 | 357,000 | ||||||
| Amortization | 296,000 | 252,000 | ||||||
| Amortization of right-of-use assets | 683,000 | 47,000 | ||||||
| Amortization, related party | 23,000 | - | ||||||
| Interest expense – debt discount | 61,000 | 2,379,000 | ||||||
| (Gain) loss on extinguishment of debt | (929,000 | ) | 2,749,000 | |||||
| Change in fair value of warrant liability | (259,000 | ) | - | |||||
| Accretion of original issue discount on notes receivable – related party | (4,213,000 | ) | 21,000 | |||||
| Accretion of original issue discount on notes receivable | (366,000 | ) | (5,000 | ) | ||||
| Increase in accrued interest on notes receivable – related party | (119,000 | ) | - | |||||
| Stock-based compensation | 4,732,000 | 272,000 | ||||||
| Realized losses on other investments | - | 28,000 | ||||||
| Realized gains on sale of marketable securities | (15,154,000 | ) | (23,000 | ) | ||||
| Unrealized losses on marketable equity securities | 6,353,000 | 132,000 | ||||||
| Unrealized gains on equity securities – related party | (6,150,000 | ) | (25,000 | ) | ||||
| Unrealized (gains) losses on equity securities | (2,795,000 | ) | 73,000 | |||||
| Changes in operating assets and liabilities: | ||||||||
| Marketable equity securities | (34,196,000 | ) | - | |||||
| Accounts receivable | (1,270,000 | ) | (591,000 | ) | ||||
| Accrued revenue | (166,000 | ) | 600,000 | |||||
| Inventories | (492,000 | ) | (199,000 | ) | ||||
| Prepaid expenses and other current assets | (5,155,000 | ) | (750,000 | ) | ||||
| Other assets | (407,000 | ) | (86,000 | ) | ||||
| Accounts payable and accrued expenses | (1,073,000 | ) | 11,986,000 | |||||
| Accounts payable, related parties | (9,000 | ) | (26,000 | ) | ||||
| Other current liabilities | 2,210,000 | 408,000 | ||||||
| Lease liabilities | (666,000 | ) | (13,000 | ) | ||||
| Net cash used in continuing operating activities | (56,911,000 | ) | (5,357,000 | ) | ||||
| Net cash provided by discontinued operating activities | — | 1,000 | ||||||
| Net cash used in operating activities | (56,911,000 | ) | (5,356,000 | ) | ||||
| Cash flows from investing activities: | ||||||||
| Purchase of property and equipment | (28,145,000 | ) | (554,000 | ) | ||||
| Investment in promissory notes, related parties | (4,994,000 | ) | (517,000 | ) | ||||
| Investments in common stock and warrants, related parties | (19,590,000 | ) | (93,000 | ) | ||||
| Investment in real property, related party | (2,670,000 | ) | - | |||||
| Proceeds from sale of investment in real property, related party | 2,670,000 | - | ||||||
| Sales of marketable equity securities | 430,000 | 144,000 | ||||||
| Purchase of marketable equity securities | (2,144,000 | ) | - | |||||
| Proceeds from loans receivable | - | 140,000 | ||||||
| Investments in debt and equity securities | (14,287,000 | ) | (13,000 | ) | ||||
| Net cash used in investing activities | $ | (68,730,000 | ) | $ | (893,000 | ) | ||
AULT GLOBAL HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (continued)
| For the Nine Months Ended September 30, | ||||||||
| 2021 | 2020 | |||||||
| Cash flows from financing activities: | ||||||||
| Gross proceeds from sales of common stock | $ | 160,483,000 | $ | - | ||||
| Financing cost in connection with sales of equity securities | (4,952,000 | ) | (25,000 | ) | ||||
| Proceeds from convertible notes payable | - | 100,000 | ||||||
| Proceeds from notes payable | 724,000 | 7,122,000 | ||||||
| Proceeds from short-term advances | - | 570,000 | ||||||
| Payments on short-term advances | - | (30,000 | ) | |||||
| Proceeds from short-term advances – related party | - | 653,000 | ||||||
| Payments on short-term advances – related party | - | (230,000 | ) | |||||
| Payments on notes payable | (2,263,000 | ) | (289,000 | ) | ||||
| Payments on advances on future receipts | - | (762,000 | ) | |||||
| Payments of preferred dividends | (13,000 | ) | (10,000 | ) | ||||
| Purchase of treasury stock | (2,773,000 | ) | - | |||||
| Payments on revolving credit facilities, net | (125,000 | ) | (44,000 | ) | ||||
| Net cash provided by financing activities | 151,081,000 | 7,055,000 | ||||||
| Effect of exchange rate changes on cash and cash equivalents | (73,000 | ) | (15,000 | ) | ||||
| Net increase in cash and cash equivalents | 25,367,000 | 791,000 | ||||||
| Cash and cash equivalents at beginning of period | 18,680,000 | 483,000 | ||||||
| Cash and cash equivalents at end of period | $ | 44,047,000 | $ | 1,274,000 | ||||
| Supplemental disclosures of cash flow information: | ||||||||
| Cash paid during the period for interest | $ | 712,000 | $ | 101,000 | ||||
| Non-cash investing and financing activities: | ||||||||
| Cancellation of convertible notes payable into shares of common stock | $ | - | $ | - | ||||
| Cancellation of notes payable into shares of common stock | $ | 449,000 | $ | 16,711,000 | ||||
| Payment of accounts payable with digital currency | $ | 119,000 | $ | - | ||||
| Issuance of common stock in payment of liability | $ | - | $ | 229,000 | ||||
| Cancellation of short-term advances, related party, into shares | ||||||||
| of common stock | $ | - | $ | 740,000 | ||||
| Issuance of notes payable and convertible notes payable in | ||||||||
| payment of accrued expenses | $ | - | $ | 420,000 | ||||
| Conversion of debt and equity securities to marketable securities | $ | 2,656,000 | $ | - | ||||
| Conversion of loans to debt and equity securities | $ | 150,000 | $ | - | ||||
| Conversion of convertible notes payable, related party, in shares | ||||||||
| of common stock | $ | 400,000 | $ | - | ||||