What changed in this filing

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Item 2. Management’s Discussion and Analysis

2022-05-16 compared with 2022-02-18 · 113 added, 69 removed, 102 unchanged (64% of the section changed)

81 unchanged sentences

and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended September 30,

of Operations – For the three months ending December 31, 2021, and 2020

revenue for the three months ended December 31, 2021, and 2020 was $10,672,489 and $8,836,076, respectively, an increase of $1,863,413,

Loss from operations for the three months ended December 31, 2021, was $4,054,523 compared to $2,045,951 for the three months

ended December 31, 2020, an increase on the loss of $2,008,572, or 98%.

Total revenue for the quarter increased, as compared to total

revenue in the same period last year, due to shutdowns and limited operations of businesses due to the COVID-19 crisis during the same

period last year.

of Operations – For the three months ending March 31, 2022, and 2021

revenue for the three months ended March 31, 2022, and 2021 was $12,728,215 and $9,260,385, respectively, an increase of $3,467,830,

Loss from operations for the three months ended March 31, 2022, was $3,819,337 compared to $1,962,598 for the three months ended

March 31, 2021, an increase on the loss of $1,856,739, or 95%.

Total revenue for the quarter increased, as compared to total revenue

in the same period last year, due to shutdowns and limited operations of businesses due to the COVID-19 crisis during the same period

Loss from operations increased due to increased expenses related to personnel costs, travel, and research and development

Advanced Technologies segment revenues for the three months ended December 31, 2021, increased by $945,648 or 20% to $5,618,517 from

$4,672,869 for the three months ended December 31, 2020.

This increase is mainly due to an improvement in economic climate from the impact

of the COVID-19 crisis during the same period last year.

Industrial Services segment revenues for the three months ended December 31, 2021, increased by $890,765 or 21%, to $5,053,972 from $4,163,207

for the three months ended December 31, 2020.

This increase is mainly due to an improvement in economic climate from the impact of the

COVID-19 crisis during the same period last year.

Profit for the three months ended December 31, 2021, was $3,869,194 or 36% of revenues as compared to gross profit of $4,005,470 or 45%

of revenues for the three months ended December 31, 2020.

Gross profit decreased in the three months ended December 31, 2021, compared

to the three months ended December 31, 2020, due to increased cost of revenues.

The Company’s gross profit margins vary from product

to product and from customer to customer.

Advanced Technologies segment revenues for the three months ended March 31, 2022, increased by $2,234,893 or 41% to $7,722,307 from $5,487,414

for the three months ended March 31, 2021.

This increase is mainly due to an improvement in economic climate from the impact of the COVID-19

crisis during the same period last year.

Industrial Services segment revenues for the three months ended March 31, 2022, increased by $1,232,937 or 33%, to $5,005,908 from $3,772,971

for the three months ended March 31, 2021.

This increase is mainly due to an improvement in economic climate from the impact of the COVID-19

crisis during the same period last year.

Profit for the three months ended March 31, 2022, was $4,052,611 or 32% of revenues as compared to gross profit of $3,928,884 or 42%

of revenues for the three months ended March 31, 2021.

Gross profit as a percentage of revenues decreased in the three months ended March

31, 2022, compared to the three months ended March 31, 2021, due to increased cost of revenues as a result of supply chain difficulties

and increased transportation costs for goods.

The Company’s gross profit margins vary from product to product and from customer

and Administrative Expenses

and administrative expenses for the three months ended December 31, 2021, increased $1,194,808 or 22% to $6,612,004 from $5,417,196 for

the three months ended December 31, 2020.

General and administrative expenses as a percentage of revenues was 62% and 61%

of revenues for the three-month periods ended December 31, 2021, and 2020, respectively.

The increase in general and administrative

expenses is the result of increased personnel, travel, marketing and sales expenses.

and administrative expenses for the three months ended March 31, 2022, increased $1,507,248 or 29% to $6,757,233 from $5,249,985 for

the three months ended March 31, 2021.

General and administrative expenses as a percentage of revenues was 53% and 57% of revenues for

the three-month periods ended March 31, 2022, and 2021, respectively.

The increase in general and administrative expenses is the result

of increased personnel, travel, depreciation and amortization, and insurance expenses.

and Development Expenses

and Development expenses for the three months ended December 31, 2021, was $1,311,713 compared to $634,225 for the three months ended

December 31, 2020.

Research and Development expenses are primarily related to the Advanced Technologies Segment’s development of

proprietary technology and further developments of the SmartDesk and Artificial Intelligence (AI) and next generation solutions associated

with security and surveillance systems software.

and Development expenses for the three months ended March 31, 2022, was $1,114,715 compared to $641,497 for the three months ended March

Research and Development expenses are primarily related to the Advanced Technologies Segment’s development of proprietary

technology and further developments of the SmartDesk and Artificial Intelligence (AI) and next generation solutions associated with security

and surveillance systems software.

Income/(Expense)

income/(expense) for the first quarter of fiscal 2022, was $(475,300) as compared to $342,047 for the first quarter of fiscal 2021.

income/(expense) for the three months ended December 31, 2021, included the gain on the forgiveness of our PPP

loans of $971,500.

income/(expense) for the second quarter of fiscal 2022, was $(982,586) as compared to $4,505,033 for the second quarter of fiscal 2021.

Other income/(expense) for the three months ended March 31, 2022, included the issuance of common stock in connection with a note payable

for Income Taxes

the first quarter of fiscal 2022, the Company did not record an income tax provision compared to $28,954 for the first quarter

of fiscal 2021.

the second quarter of fiscal 2022, the Company did not record an income tax provision compared to $98,477 for the second quarter of fiscal

The provision for income tax is based upon the projected income tax from the Company’s various U.S.

and international

subsidiaries that are subject to their respective income tax jurisdictions and the Company’s projected ability to utilize net loss

carryforwards.

and international subsidiaries

that are subject to their respective income tax jurisdictions and the Company’s projected ability to utilize net loss carryforwards.

income/(loss) attributable to Cemtrex, Inc.

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shareholders of $4,721,247, or 37% of revenues, for the three-month period ended

December 31, 2021, as compared to a net loss attributable to Cemtrex, Inc.

shareholders of $1,692,611 or 19% of revenues, for

the three months ended December 31, 2020.

March 31, 2022, as compared to net income attributable to Cemtrex, Inc.

shareholders of $2,454,132 or 27% of revenues, for the three

months ended March 31, 2021.

Net loss attributable to Cemtrex, Inc.

shareholders increased in the first quarter as compared

to the same period last year was primarily due to costs of revenues and operating expenses mentioned above.

shareholders increased in the first quarter as compared to the same

period last year was primarily due to costs of revenues, operating, and other expenses mentioned above.

of Operations – For the six months ending March 31, 2022, and 2021

revenue for the six months ended March 31, 2022, and 2021 was $23,400,704 and $18,096,461 respectively, an increase of $5,304,243, or

Loss from operations for the six months ended March 31, 2022, was $7,873,860 compared to $4,008,549 for the six months ended March

31, 2021, an increase on the loss of $3,865,311, or 96%.

Total revenue for the period increased, as compared to total revenue in the

same period last year, due to shutdowns and limited operations of businesses due to the COVID-19 crisis during the same period last year.

Loss from operations increased due to increased expenses related to personnel costs, depreciation and amortization, insurance, travel,

and research and development costs.

Advanced Technologies segment revenues for the six months ended March 31, 2022, increased by $3,180,541 or 31% to $13,340,824 from $10,160,283

for the six months ended March 31, 2021.

This increase is mainly due to an improvement in economic climate from the impact of the COVID-19

crisis during the same period last year.

Industrial Services segment revenues for the six months ended March 31, 2022, increased by $2,123,702 or 27%, to $10,059,880 from $7,936,178

for the six months ended March 31, 2021.

This increase is mainly due to an improvement in economic climate from the impact of the COVID-19

crisis during the same period last year.

Profit for the six months ended March 31, 2022, was $7,921,805 or 34% of revenues as compared to gross profit of $7,934,354 or 44% of

revenues for the six months ended March 31, 2021.

Gross profit decreased in the six months ended March 31, 2022, compared to the six

months ended March 31, 2021, due to increased cost of revenues as a result of supply chain difficulties and increased transportation

costs for goods.

The Company’s gross profit margins vary from product to product and from customer to customer.

and Administrative Expenses

and administrative expenses for the six months ended March 31, 2022, increased $2,702,056 or 25% to $13,369,237 from $10,667,181 for

the six months ended March 31, 2021.

General and administrative expenses as a percentage of revenues was 57% and 59% of revenues for

the six-month periods ended March 31, 2022, and 2021, respectively.

The increase in general and administrative expenses is the result

of increased personnel, travel, depreciation and amortization, and insurance expenses.

and Development Expenses

and Development expenses for the six months ended March 31, 2022, was $2,426,428 compared to $1,275,722 for the six months ended March

Research and Development expenses are primarily related to the Advanced Technologies Segment’s development of proprietary

technology and further developments of the SmartDesk and Artificial Intelligence (AI) and next generation solutions associated with security

and surveillance systems software.

Income/(Expense)

income/(expense) for the first and second quarters of fiscal 2022, was $(1,457,886) as compared to $4,847,080 for the first and second

quarters of fiscal year 2021.

Other income/(expense) for the six months ended March 31, 2022, included the gain on the forgiveness of

our PPP loans of $971,500 and the issuance of common stock in connection with a note payable of $700,400.

for Income Taxes

the first and second quarters of fiscal year 2022, the Company did not record an income tax provision compared to $127,431 for the first

and second quarters of fiscal year 2021.

The provision for income tax is based upon the projected income tax from the Company’s

and international subsidiaries that are subject to their respective income tax jurisdictions and the Company’s projected

ability to utilize net loss carryforwards.

income/(loss) attributable to Cemtrex, Inc.

Company had a net loss attributable to Cemtrex, Inc.

shareholders of $9,199,198, or 39% of revenues, for the six-month period ended March

31, 2022, as compared to net income attributable to Cemtrex, Inc.

shareholders of $761,521 or 4% of revenues, for the six months ended

March 31, 2021.

Net loss attributable to Cemtrex, Inc.

shareholders increased in the first and second quarters of fiscal year 2022 as

compared to the same period last year was primarily due to costs of revenues and operating expenses mentioned above.

Company’s business and operations have not been materially affected by inflation during the periods for which financial information

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and Capital Resources

capital was $12,801,113 at December 31, 2021, compared to $15,088,892 at September 30, 2021.

This includes cash and equivalents and restricted

cash of $11,972,430 at December 31, 2021, and $17,186,323 at September 30, 2021.

capital was $7,604,437 at March 31, 2022, compared to $15,088,892 at September 30, 2021.

This includes cash and equivalents and

restricted cash of $10,630,229 at March 31, 2022, and $17,186,323 at September 30, 2021.

The decrease in working capital was primarily

due to the Company’s use of cash to build inventory and pay down liabilities during the first quarter of fiscal year 2022.

receivable decreased $2,263,147 or 29% to $5,547,749 at December 31, 2021, from $7,810,896 at September 30, 2021.

due to the Company’s use of cash to build inventory and a shift of liabilities to short-term during the first two quarters of fiscal

receivable decreased $1,805,328 or 23% to $6,005,568 at March 31, 2022, from $7,810,896 at September 30, 2021.

The decrease in accounts

receivable is attributable to collections of receivables from the last quarter of fiscal year 2021 and lower revenues in this quarter

and compared to the fourth quarter of fiscal year 2021.

increased $1,428,411 or 25% to $7,085698 at December 31, 2021, from $5,657,287 at September 30, 2021.

The increase in inventories

is attributable to the purchase of inventories for new products the Company plans to ship in the future.

Cash used by operating

activities for the three months ended December 31, 2021 and 2021 was $4,352,702 and $1,078,052 respectively.

The decrease in operating

cash flows was primarily due to purchases on inventory and payment of accounts payable and accrued expenses.

Cash used by investment

activities for the three months ended December 31, 2021 and 2020 was $291,666 and $675,487, respectively.

Investing activities for

the first quarter of fiscal year 2022 were driven by the Company’s purchase of fixed assets.

Cash used by financing

activities for the three months ended December 31, 2021 and 2020 was $632,753 and $1,629,708, respectively.

Financing activities

were primarily driven by payments on bank loans and notes.

receivable is attributable to increased collection efforts to keep our accounts receivable from going past due.

increased $1,409,367 or 25% to $7,066,654 at March 31, 2022, from $5,657,287 at September 30, 2021.

The increase in inventories is attributable

to the purchase of inventories for new products the Company plans to ship in the future and to build up stock inventory to account for

supply chain issues.

used by operating activities for the six months ended March 31, 2022 and 2021 was $7,235,840 and $2,865,654 respectively.

in operating cash flows was primarily due to purchases on inventory and payment of accounts payable and accrued expenses.

used by investment activities for the six months ended March 31, 2022 and 2021 was $5,654,515 and $110,129, respectively.

Investing activities

for the first and second quarters of fiscal year 2022 were driven by the Company’s purchase of fixed assets, the additional investment

in Masterpiece VR, and marketable securities.

provided by financing activities for the six months ended March 31, 2022 and 2021 was $6,484,337 and $754,748, respectively.

activities were primarily driven by proceeds from the note payable issued in February of 2022.

believe that our cash on hand and cash generated by operations is sufficient to meet the capital demands of our current operations for

fiscal year 2022 (ending September 30, 2022).

Any major increases in sales, particularly in new products, may require substantial

capital investment.

Any major increases in sales, particularly in new products, may require substantial capital

Failure to obtain sufficient capital could materially adversely impact our growth potential.

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis