What changed in this filing

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Item 1. Financial Statements

2021-11-12 compared with 2021-08-12 · 125 added, 103 removed, 399 unchanged (36% of the section changed)

2 unchanged sentences

CONSOLIDATED BALANCE SHEETS

June 30, 2021

September 30, 2021

December 31, 2020

4 unchanged sentences

Prepaid expenses

Deferred tax asset

Total current assets

1 unchanged sentence

Investment in joint venture

Deferred tax asset

$ 105,358,608

Liabilities and stockholders’ equity

15 unchanged sentences

5,000,000 shares authorized;

0 shares issued and outstanding as of June 30, 2021 and December 31, 2020

0 shares issued and outstanding as of September 30, 2021 and December 31, 2020

Common stock, $ 0.001 par value;

100,000,000 shares authorized;

28,889,890 and 28,558,033 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively

28,894,890 and 28,558,033 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively

Additional paid-in capital

2 unchanged sentences

Total liabilities and stockholders’ equity

$ 105,358,608

accompanying notes to unaudited condensed consolidated financial statements

1 unchanged sentence

CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Cost of revenue

11 unchanged sentences

Income before income taxes

Income tax provision

Income tax provision (benefit)

( 2,914,781 )

Earnings per common share:

3 unchanged sentences

CONSOLIDATED STATEMENTS OF CASH FLOWS

Six Months Ended June 30,

Nine Months Ended September 30,

Cash flows from operating activities

3 unchanged sentences

Loss (gain) from equity method investment

( 1,016,297 )

Deferred income taxes

( 2,914,781 )

Bad debt expense

2 unchanged sentences

( 2,608,777 )

Prepaid expenses

( 10,509,035 )

Prepaid expenses

( 10,647,034 )

2 unchanged sentences

Accounts payable and accrued expenses

Net cash provided by (used in) operating activities

Net cash provided by operating activities

Cash flows from investing activities

Purchases of property and equipment

Purchases of marketable investment securities

( 9,310,000 )

Proceeds from maturities of marketable investment securities

1 unchanged sentence

Net cash provided by (used in) investing activities

( 7,070,183 )

Cash flows from financing activities

15 unchanged sentences

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

Preferred Stock

Convertible Preferred Stock

Additional Paid-in

16 unchanged sentences

Balance as of June 30, 2021

Common stock issued for option exercises

Stock-based compensation

Balance as of September 30, 2021

$ 100,158,353

Balance as of December 31, 2019

10 unchanged sentences

Stock-based compensation expense

Net income (loss)

Balance as of June 30, 2020

$ ( 11,027,998 )

Common stock issued for option exercises

Stock-based compensation

Stock-based compensation expense

Net income (loss)

Balance as of September 30, 2020

accompanying notes to unaudited condensed consolidated financial statements

3 unchanged sentences

Co-Diagnostics,

Inc., a Utah corporation (the “Company” or “CDI”), is developing robust and innovative molecular tools for detection

of infectious diseases, liquid biopsy for cancer screening, and agricultural applications.

The Company develops, manufactures and sells

reagents used for diagnostic tests that function via the detection and/or analysis of nucleic acid molecules (DNA or RNA).

In connection

with the sale of these tests, the Company may sell diagnostic equipment and supplies from other manufacturers.

Inc., a Utah corporation (the “Company” or “Co-Dx”), is developing robust and innovative molecular tools for

detection of infectious diseases, liquid biopsy for cancer screening, and agricultural applications.

The Company develops, manufactures,

and sells reagents used for diagnostic tests that function via the detection and/or analysis of nucleic acid molecules (DNA or RNA).

In connection with the sale of these tests, the Company may sell diagnostic equipment and supplies from other manufacturers.

Condensed Consolidated Financial Statements

1 unchanged sentence

generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q as they are

prescribed for smaller reporting companies.

Accordingly, they do not include all the information and footnotes required by accounting

principles generally accepted in the United States of America for complete financial statements.

In the opinion of management, all adjustments

(consisting of normal recurring accruals) considered necessary to make the financial statements not misleading have been included.

results for the three months ended June 30, 2021 are not necessarily indicative of the results that may be expected for the year ending

December 31, 2021.

These statements should be read in conjunction with the Company’s audited financial statements and related notes

for the year ended December 31, 2020, included in the Company’s Annual Report on Form 10-K filed on March 25, 2021.

prescribed for smaller reporting companies and emerging growth companies.

Accordingly, they do not include all the information and footnotes

required by accounting principles generally accepted in the United States of America for complete financial statements.

In the opinion

of management, all adjustments (consisting of normal recurring accruals) considered necessary to make the financial statements not misleading

have been included.

Operating results for the three months ended September 30, 2021 are not necessarily indicative of the results that

may be expected for the year ending December 31, 2021.

These statements should be read in conjunction with the Company’s audited

financial statements and related notes for the year ended December 31, 2020, included in the Company’s Annual Report on Form 10-K

filed on March 25, 2021.

2020 financial statement amounts have been reclassified to conform to 2021 presentations.

10 unchanged sentences

or less from the date of purchase.

The fair value of cash equivalents approximated their carrying value as of June 30, 2021 and December

The Company has its cash and cash equivalents with a large creditworthy financial institution and the balance exceeded federally

insured limits.

The Company has not experienced any losses in such accounts, and management believes the Company is not exposed to any

significant credit risk on cash and cash equivalents.

The fair value of cash equivalents approximated their carrying value as of September 30, 2021 and

December 31, 2020.

The Company has its cash and cash equivalents with large creditworthy financial institutions and the balance exceeded

federally insured limits.

The Company has not experienced any losses in such accounts, and management believes the Company is not exposed

to any significant credit risk on cash and cash equivalents.

Investment Securities

16 unchanged sentences

written off are recorded when collected.

At June 30, 2021, total accounts receivable was $ 13,686,152 with an allowance for uncollectable

At September 30, 2021, total accounts receivable was $ 15,347,499 with an allowance for uncollectable

accounts of $ 757,900 resulting in a net amount of $ 14,589,599 .

11 unchanged sentences

average cost in accordance with ASC 330-10-30-12.

At June 30, 2021, the Company had $ 4,120,704 in inventory, of which $ 659,737 was finished

goods and $ 3,460,967 was raw materials.

At December 31, 2020, the Company had $ 7,995,189 in inventory, of which $ 598,881 was finished

goods and $ 7,396,308 was raw materials.

The Company establishes reserves to reduce slow-moving, obsolete, or unusable inventories to

their estimated useful or scrap values.

At September 30, 2021, the Company had $ 3,302,925 in inventory, of which $ 925,620 was

finished goods and $ 2,377,305 was raw materials.

At December 31, 2020, the Company had $ 7,995,189 in inventory, of which $ 598,881 was

finished goods and $ 7,396,308 was raw materials.

The Company establishes reserves to reduce slow-moving, obsolete, or unusable inventories

to their estimated useful or scrap values.

and Equipment

27 unchanged sentences

and development costs are expensed when incurred.

For the three and six months ended June 30, 2021, the Company expensed $ 4,669,160 and

$ 6,886,223 of research and development costs, respectively.

For the three and six months ended June 30, 2020, the Company expensed $ 750,249

and $ 1,150,271 , respectively.

For the three and nine months ended September 30, 2021, the Company expensed $ 5,893,350

and $ 12,779,573 of research and development costs, respectively.

For the three and nine months ended September 30, 2020, the Company

expensed $ 921,889 and $ 2,072,160 , respectively.

Company has granted stock-based awards, including restricted stock, stock options, stock warrants and restricted stock units (“RSUs”),

26 unchanged sentences

Risk and Significant Customers

Company had certain customers which are each responsible for generating 10% or more of the total revenue for the three months ended June

Two customers together accounted for approximately 67 % of total revenue for the three months ended June 30, 2021.

customers each accounted for more than 10% of accounts receivable at June 30, 2021.

These two customers together accounted for approximately

48 % of accounts receivable at June 30, 2021.

Income (Loss) per Share

Company had certain customers which are each responsible for generating 10% or more of the total revenue for the three and nine months

ended September 30, 2021.

Two customers together accounted for approximately 55 % and 49 %, respectively, of total revenue for the three

and nine months ended September 30, 2021.

customers each accounted for more than 10% of accounts receivable at September 30, 2021 and December 31, 2020.

These two customers together

accounted for approximately 52 % and 48 % of accounts receivable at September 30, 2021 and December 31, 2020, respectively.

Income per Share

net income or loss per common share is computed by dividing net income or loss applicable to common shareholders by the weighted average

49 unchanged sentences

The following

table summarizes the assets measured at fair value on a recurring basis as of June 30, 2021 and December 31, 2020, by level within the

fair value hierarchy:

table summarizes the assets measured at fair value on a recurring basis as of September 30, 2021, and December 31, 2020, by level within

the fair value hierarchy:

of Assets Measured at Fair Value on Recurring Basis

June 30, 2021

September 30, 2021

Marketable investment securities:

5 unchanged sentences

of Revenue by Geographic Area

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

United States

3 unchanged sentences

Rest of World

in the Company’s deferred revenue balance for the six months ended June 30, 2021 were as follows:

in the Company’s deferred revenue balance for the nine months ended September 30, 2021 were as follows:

of Deferred Revenue

2 unchanged sentences

Increase due to prepayments from customers

Balance as of June 30, 2021

Balance as of September 30, 2021

Company expects to perform its performance obligation and recognize the deferred revenue as revenue during the year ended December 31,

5 – Earnings Per Share

following table reconciles the numerator and the denominator used to calculate basic and diluted earnings per share for three and six

months ended June 30, 2021 and 2020:

following table reconciles the numerator and the denominator used to calculate basic and diluted earnings per share for three and nine

months ended September 30, 2021 and 2020:

of Basic and Diluted Earnings Per Share

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Net income (loss), as reported

4 unchanged sentences

Diluted earnings per share

the three and six months ended June 30, 2021, potentially dilutive securities of 931,341 and 146,133 were excluded from the calculation

the three and nine months ended September 30, 2021, potentially dilutive securities of 50,000 and 147,436 were excluded from the calculation

because their effect would have been anti-dilutive.

No securities were excluded from the calculation for the three and six months ended

June 30, 2020.

For the three and nine months ended September 30, 2020, potentially dilutive securities

of 50,000 were excluded from the calculation because their effect would have been anti-dilutive.

6 – Stock-Based Compensation

4 unchanged sentences

The number of awards available for issuance under the Incentive Plan

was 2,798,683 at June 30, 2021.

following table summarizes option activity during the six months ended June 30, 2021:

was 2,064,933 at September 30, 2021.

following table summarizes option activity during the nine months ended September 30, 2021:

of Option Activity

2 unchanged sentences

Weighted Average Fair Value

Weighted Average Remaining Contractual

Weighted Average Remaining Contractual Life (Years)

Outstanding at December 31, 2020

Forfeited/Cancelled

Outstanding at June 30, 2021

Exercisable at June 30, 2021

total intrinsic value of options exercised during the six months ended June 30, 2021 was approximately $ 1.3 million.

The aggregate intrinsic

value of outstanding options at June 30, 2021 was approximately $ 6.9 million.

Outstanding at September 30, 2021

Exercisable at September 30, 2021

total intrinsic value of options exercised during the nine months ended September 30, 2021 was approximately $ 1.3 million.

The aggregate

intrinsic value of outstanding options at September 30, 2021 was approximately $ 8.5 million.

compensation cost is measured at the grant date based on the fair value of the award granted and recognized as expense over the vesting

6 unchanged sentences

and the remaining will be recognized over the remaining service period.

of June 30, 2021, there were 288,327 of unvested options and $ 186,144 of unrecognized stock-based compensation expense.

The unrecognized

stock-based compensation expense is expected to be recognized over 0.9 years.

of September 30, 2021, there were 16,666

of unvested options and $ 119,897 of unrecognized

stock-based compensation expense.

The unrecognized stock-based compensation expense is expected to be recognized over 0.7 years.

grant date fair value of RSUs granted is determined using the closing market price of the Company’s common stock on the grant date

1 unchanged sentence

The following table sets forth the outstanding

RSUs and related activity for the six months ended June 30, 2021:

RSUs and related activity for the nine months ended September 30, 2021:

of Outstanding Restricted Stock Units and Related Activity

Number of RSUs

Weighted Average Grant Date Fair

Weighted Average Grant Date Fair Value

Unvested at December 31, 2020

Forfeited/Cancelled

Unvested at June 30, 2021

of June 30, 2021, there was approximately $ 7.8 million of unrecognized stock-based compensation expense related to outstanding RSUs which

is expected to be recognized over a weighted-average period of 2.7 years.

Unvested at September 30, 2021

of September 30, 2021, there was approximately $ 13.5 million of unrecognized stock-based compensation expense related to outstanding

RSUs which is expected to be recognized over a weighted-average period of 2.5 years.

Company has issued warrants related to past financings and as compensation to third parties for services provided.

3 unchanged sentences

fair value of issued warrants using a vesting schedule based on the terms and conditions of each warrant if granted for services.

following table summarizes warrant activity during the six months ended June 30, 2021:

following table summarizes warrant activity during the nine months ended September 30, 2021:

of Warrant Activity

2 unchanged sentences

Weighted Average Fair Value

Weighted Average Remaining Contractual

Weighted Average Remaining Contractual Life (Years)

Outstanding at December 31, 2020

Forfeited/Cancelled

Outstanding at June 30, 2021

aggregate intrinsic value of outstanding warrants at June 30, 2021 was approximately $ 450,000 .

Outstanding at September 30, 2021

aggregate intrinsic value of outstanding warrants at September 30, 2021 was approximately $ 553,000 .

All outstanding warrants are exercisable

at June 30, 2021 and there was no unrecognized stock-based compensation expense related to warrants.

at September 30, 2021 and there was no unrecognized stock-based compensation expense related to warrants.

Issued for Services

4 unchanged sentences

The Company has issued 5,548 shares of restricted stock for services during the

six months ended June 30, 2021 and there was no unrecognized stock-based compensation expense related to restricted stock issued.

nine months ended September 30, 2021 and there was no unrecognized stock-based compensation expense related to restricted stock issued.

Compensation Expense

Company recognized stock-based compensation expense related to the types of awards discussed above as follows:

of Recognized Stock-based Compensation Expense

Three Months Ended June 30,

Six Months Ended June 30,

of Recognized Stock-based Compensation Expenses

Three Months Ended September 30,

Nine Months Ended September 30,

Restricted stock units

1 unchanged sentence

7 – Income Taxes

the three months ended June 30, 2021, the Company recognized an expense from income taxes of $ 2,145,076 , representing an effective tax

rate of 18.0 %.

For the six months ended June 30, 2021, the Company recognized an expense from income taxes of $ 4,130,716 , representing

the three months ended September 30, 2021, the Company recognized an expense from income taxes of $ 2,100,594 , representing an effective

tax rate of 15.5 %.

For the nine months ended September 30, 2021, the Company recognized an expense from income taxes of $ 6,231,310 , representing

an effective tax rate of 17.6 %.

2 unchanged sentences

21.0 % due to state taxes, permanent items, and discrete items.

For the three and six months ended June 30, 2020, no benefit from income

taxes was recorded due to the Company being in a full valuation allowance position, resulting in an effective tax rate of 0.0 %.

For the three and nine months ended September 30, 2020, the Company recognized

a benefit from income taxes of $ 2,914,781 .

8 – Related Party Transactions

8 unchanged sentences

$ 700,000 of accrued royalties at the rate of $ 10,000 per month.

At June 30, 2021, the aggregate balance of this related party liability

was $ 90,000 .

At September 30, 2021 and 2020, the aggregate balance of this related

party liability was $ 30,000 and $ 120,000 , respectively.

9 – Commitments and Contingencies

2 unchanged sentences

In February 2020, the Company

entered into a 4 -year lease agreement for its office space and in March 2020, the Company entered into an addendum with our landlord

for additional space.

The new aggregate space consists of approximately 13,687 square feet at a monthly rate of $ 28,825 and expires in

February 2024 .

For the three and six months ended June 30, 2021 the Company expensed $ 86,588 and $ 173,175 for rent, respectively.

the three and six months ended June 30, 2020, the Company expensed $ 86,969 and $ 138,786 for rent, respectively.

The Company’s future

minimum lease payments were as follows as of June 30, 2021:

entered into a 4 -year

lease agreement for its office space and in March 2020, the Company entered into an addendum with our landlord for additional space.

The new aggregate space consists of approximately 13,687

square feet at a monthly rate of $ 28,825 and expires in February

For the three and nine months ended September 30, 2021, the Company expensed $ 86,588 and $ 259,763 for rent, respectively.

three and nine months ended September 30, 2020, the Company expensed $ 86,588 and $ 225,374 for rent, respectively.

The Company’s

future minimum lease payments were as follows as of September 30, 2021:

of Future Minimum Lease Payments

19 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 1. Financial Statements