What changed in this filing

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Item 2. Management’s Discussion and Analysis

2022-08-15 compared with 2022-05-16 · 107 added, 96 removed, 119 unchanged (63% 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 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 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.

of Operations – For the three months ending June 30, 2022, and 2021

Total revenue for the three months

ended June 30, 2022, and 2021 was $13,630,846 and $10,326,431, respectively, an increase of $3,304,415, or 32%.

Loss from operations for

the three months ended June 30, 2022, was $2,120,849 compared to $2,300,269 for the three months ended June 30, 2021, a decrease on the

loss of $179,420, or 8%.

Total revenue for the quarter increased, as compared to total revenue in the same period last year, due to increased

demand for the Company’s products and services.

Loss from operations decreased due to increased revenues as compared to the same

period in the prior year.

Our Advanced Technologies segment revenues for the

three months ended June 30, 2022, increased by $2,316,897 or 40% to $8,162,855 from $5,845,958 for the three months ended June 30, 2021.

This increase is due to an increased demand for security technology products under our Vicon brand.

Our Industrial Services segment

revenues for the three months ended June 30, 2022, increased by $987,518 or 22%, to $5,467,991 from $4,480,473 for the three months ended

June 30, 2021.

This increase is mainly due to an increased demand for the segment’s products and services.

Profit for the three months ended June 30, 2022, was $5,876,356 or 43% of revenues as compared to gross profit of $4,127,716 or 40% of

revenues for the three months ended June 30, 2021.

Gross profit as a percentage of revenues increased in the three months ended June

30, 2022, compared to the three months ended June 30, 2021, due to price increases implemented throughout the company in response to

rising costs of our goods and transportation costs.

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 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 administrative expenses for the three months ended June 30, 2022, increased $1,278,940 or 23% to $6,948,959 from $5,670,019 for the

three months ended June 30, 2021.

General and administrative expenses as a percentage of revenues was 51% and 55% of revenues for the

three-month periods ended June 30, 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 March 31, 2022, was $1,114,715 compared to $641,497 for the three months ended March

and Development expenses for the three months ended June 30, 2022, was $1,048,246 compared to $757,966 for the three months ended June

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

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Income/(Expense)

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

income/(expense) for the third quarter of fiscal 2022, was $1,141,206 as compared to $3,468,649 for the third quarter of fiscal 2021.

Other income/(expense) for the three months ended June 30, 2022, included realized and unrealized gain on marketable securities of $2,075,125.

for Income Taxes

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 third quarter of fiscal 2022, the Company had an income tax benefit of $247,941 compared to an expense of $40,759 for the third quarter

of fiscal 2021.

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.

Company had a net loss attributable to Cemtrex, Inc.

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

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, 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.

shareholders of $680,739, or 5% of revenues, for the three-month period ended June

30, 2022, as compared to net income attributable to Cemtrex, Inc.

shareholders of $1,098,013 or 11% of revenues, for the three months

ended June 30, 2021.

Net income/(loss) attributable to Cemtrex, Inc.

shareholders decreased in the third quarter as compared to the same

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

of Operations – For the nine months ending June 30, 2022, and 2021

Total revenue for the nine months

ended June 30, 2022, and 2021 was $37,031,550 and $28,422,892 respectively, an increase of $8,608,658, or 30%.

Loss from operations for

the nine months ended June 30, 2022, was $9,994,709 compared to $6,308,818 for the nine months ended June 30, 2021, an increase on the

loss of $3,685,891, or 58%.

Total revenue for the period increased, as compared to total revenue in the same period last year, due to

increased demand for the Company’s products and services.

Loss from operations increased due to increased expenses related to personnel

costs, depreciation and amortization, insurance, travel, and research and development costs.

Our Advanced Technologies segment revenues for the

nine months ended June 30, 2022, increased by $5,497,438 or 34% to $21,503,679 from $16,006,241 for the nine months ended June 30, 2021.

This increase is due to an increased demand for security technology products under our Vicon brand.

Our Industrial Services segment

revenues for the nine months ended June 30, 2022, increased by $3,111,220 or 25%, to $15,527,871 from $12,416,651 for the nine months

ended June 30, 2021.

This increase is mainly due to an increased demand and increased pricing for the segment’s products and services.

Profit for the nine months ended June 30, 2022, was $13,798,161 or 37% of revenues as compared to gross profit of $12,062,070 or 42%

of revenues for the nine months ended June 30, 2021.

Gross profit as a percentage of revenues decreased in the nine months ended June

30, 2022, compared to the nine months ended June 30, 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 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.

and administrative expenses for the nine months ended June 30, 2022, increased $3,980,996 or 24% to $20,318,196 from $16,337,200 for

the nine months ended June 30, 2021.

General and administrative expenses as a percentage of revenues was 55% and 57% of revenues for

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

the nine-month periods ended June 30, 2022, and 2021, respectively.

The increase in general and administrative expenses is the result

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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

and Development expenses for the nine months ended June 30, 2022, was $3,474,674 compared to $2,033,688 for the nine months ended June

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

2 unchanged sentences

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.

income/(expense) for the first three quarters of fiscal 2022, was $(316,680) as compared to $8,315,729 for the first three quarters of

fiscal year 2021.

Other income/(expense) for the nine months ended June 30, 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 and the realized and unrealized gain on marketable

securities of $2,235,738.

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 first three quarters of fiscal year 2022, the Company had an income tax benefit of $247,941 compared to an expense of $168,190 for

the first three quarters of fiscal year 2021.

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

3 unchanged sentences

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.

shareholders of $9,879,991, or 27% of revenues, for the nine-month period ended

June 30, 2022, as compared to net income attributable to Cemtrex, Inc.

shareholders of $1,859,534 or 7% of revenues, for the nine months

ended June 30, 2021.

Net loss attributable to Cemtrex, Inc.

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

shareholders increased in the first three 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.

2 unchanged sentences

and Capital Resources

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 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 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.

capital was $5,751,185 at June 30, 2022, compared to $15,088,892 at September 30, 2021.

This includes cash and equivalents and restricted

cash of $12,961,207 at June 30, 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 a shift of liabilities to short-term during the first three quarters of fiscal year

receivables decreased $246,514 or 3% to $7,564,382 at June 30, 2022, from $7,810,896 at September 30, 2021.

The decrease in trade receivables

is attributable to increased collection efforts to keep our trade receivables from going past due.

increased $2,801,243 or 50% to $8,458,530 at June 30, 2022, from $5,657,287 at September 30, 2021.

The increase in inventories is attributable

1 unchanged sentence

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.

used by operating activities for the nine months ended June 30, 2022 and 2021 was $10,246,799 and $6,198,611 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

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

provided by investment activities for the nine months ended June 30, 2022 was $517,029 compared to $154,326 for the nine-month period

ending June 30, 2021.

Investing activities for the first three quarters of fiscal year 2022 were driven mainly by the Company’s

net gain on the purchase and sale of marketable securities and the sale of property and equipment.

provided by financing activities for the nine months ended June 30, 2022 and 2021 $5,902,298 compared to using cash of $160,158 for the

nine-month period ending June 30, 2021.

Financing activities were primarily driven by proceeds from the note payable issued in February

believe that our cash on hand and cash generated by operations is

sufficient to meet the capital demands of our current operations for the next year (ending June 30, 2023).

While our working capital and

current debt indicate a going concern issue, the Company has historically, from time to time, satisfied and may continue to satisfy certain

short-term liabilities through the issuance of common stock, thus reducing our cash requirement to meet our operating needs.

increases in sales, particularly in new products, may require substantial capital investment.

Failure to obtain sufficient capital could

materially adversely impact our growth potential.

there is no guarantee that cash flow from our existing or future operations and any external capital that we may be able to raise will

1 unchanged sentence

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