What changed in this filing

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Item 1. Financial Statements

2022-04-13 compared with 2022-01-13 · 117 added, 98 removed, 233 unchanged (48% of the section changed)

2 unchanged sentences

Destiny Media Technologies Inc.

November 30, 2021

February 28, 2022

(Expressed in United States dollars)

3 unchanged sentences

Cash and cash equivalents

Short-term investments [note 3]

Accounts receivable, net of allowance for doubtful accounts of $ 30,895 , [August 31, 2021 - $ 19,743 ]

11 unchanged sentences

Total current liabilities

Operating lease liability, net of current portion [note 5]

Total liabilities

Commitments and contingencies [note 7]

Contingencies [note 7]

Stockholders' equity

11 unchanged sentences

Destiny Media Technologies Inc.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF INCOME (LOSS)

(Expressed in United States dollars)

Three months ended November 30,

Service revenue [note 10]

3 unchanged sentences

Customer support

Third party and transaction costs

Third Party and transactions costs

Operating expenses

3 unchanged sentences

Depreciation and amortization

Income from operations

Income (loss) from operations

Interest income

Net income per common share, basic and diluted

Gain on disposal of assets [notes 4 and 5]

Net income (loss)

Net income (loss) per common share,

basic and diluted

Weighted average common shares outstanding:

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF

COMPREHENSIVE INCOME (LOSS)

Basic and diluted

See accompanying notes

Destiny Media Technologies Inc.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Expressed in United States dollars)

Three months ended November 30,

Net income (loss) for the period

Other comprehensive income (loss)

Foreign currency translation adjustments

Total comprehensive income

Comprehensive income (loss)

See accompanying notes

2 unchanged sentences

(Expressed in United States dollars)

Three months ended November 30, 2021 and 2020

Three month periods ended February 28, 2022 and February 28, 2021

stockholders'

comprehensive

Balance, August 31, 2021

Total comprehensive income

Shares repurchased for cancellation

Balance, November 30, 2021

Total comprehensive income (loss)

Stock based compensation [note 6]

Stock options repurchased and retired

Common shares retired

Balance, February 28, 2022

Balance, November 30, 2020

Total comprehensive income (loss)

Stock based compensation [note 6]

Common shares retired

Balance, February 28, 2021

See accompanying notes

Destiny Media Technologies Inc.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

(Expressed in United States dollars)

Six month periods ended February 28, 2022 and 2021

stockholders'

comprehensive

Balance, August 31, 2021

Total comprehensive income

Total comprehensive income (loss)

Stock based compensation [note 6]

Balance, November 30, 2020

Stock options repurchased and retired

Common shares retired

Balance, February 28, 2022

Balance, August 31, 2020

Total comprehensive income (loss)

Stock based compensation [note 6]

Common shares retired

Balance, February 28, 2021

See accompanying notes

1 unchanged sentence

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS

Three months ended November 30,

Six month periods ended February 28, 2022 and 2021

(Expressed in United States dollars)

OPERATING ACTIVITIES

Net income (loss)

Items not involving cash:

1 unchanged sentence

Stock-based compensation

Deferred leasehold inducement

Allowance for doubtful accounts

Gain on disposal of assets

Unrealized foreign exchange (gain) loss

7 unchanged sentences

Operating lease liability

Net cash (used in) provided by operating activities

Net cash provided by operating activities

INVESTING ACTIVITIES

Redemption (purchase) of short-term investments, net

Sale of short-term investments, net

Development of software

3 unchanged sentences

Repurchase of common stock for retirement

Repurchase of stock options for retirement

Net cash used in financing activity

6 unchanged sentences

Income taxes paid

Non-cash investing and financing activities

Right of use asset

Operating lease liability

See accompanying notes

2 unchanged sentences

FINANCIAL STATEMENTS

November 30, 2021

As at February 28, 2022

Destiny Media Technologies Inc.

9 unchanged sentences

In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included.

Operating results for the three months ended November 30, 2021 are not necessarily indicative of the results that may be expected for the year ended August 31, 2022.

Operating results for the six months ended February 28, 2022 are not necessarily indicative of the results that may be expected for the year ended August 31, 2022.

The balance sheet at August 31, 2021 has been derived from the audited consolidated financial statements at that date but does not include all of the information and footnotes required by United States generally accepted accounting principles for annual financial statements.

9 unchanged sentences

FINANCIAL STATEMENTS

November 30, 2021

As at February 28, 2022

SHORT TERM INVESTMENTS

The Company's short-term investments consisted of one-year Guaranteed Investment Certificates with a major Canadian financial institution that earn interest at variable interest rates ranging from 0.10 % - 2.36 %.

As at November 30, 2021, the Company's short-term investments had reached maturity, and are included in cash and cash equivalents.

The Company's short-term investments consists of one-year Guaranteed Investment Certificates with a major Canadian financial institution that earn interest at variable interest rates ranging from 0.10 % - 2.36 %.

As at February 28, 2022, the Company's short-term investments had reached maturity, and are included in cash and cash equivalents.

PROPERTY AND EQUIPMENT AND INTANGIBLES

November 30, 2021

February 28, 2022

Property and equipment

5 unchanged sentences

Patents, trademarks, and lists

Destiny Media Technologies Inc.

NOTES TO CONDENSED CONSOLIDATED INTERIM

FINANCIAL STATEMENTS

As at February 28, 2022

PROPERTY AND EQUIPMENT AND INTANGIBLES (cont'd)

August 31, 2021

6 unchanged sentences

Patents, trademarks, and lists

Destiny Media Technologies Inc.

NOTES TO CONDENSED CONSOLIDATED INTERIM

FINANCIAL STATEMENTS

November 30, 2021

Depreciation and amortization for the three-month period ended November 30, 2021 was $ 27,172 (2020:

Destiny Media Technologies Inc.

NOTES TO CONDENSED CONSOLIDATED INTERIM

FINANCIAL STATEMENTS

November 30, 2021

Depreciation and amortization for the three and six-month periods ended February 28, 2022 was $ 26,574 and $ 53,746 respectively (2021:

$ 26,400 and $ 50,715 ).

On January 31, 2022, the Company exited the lease of office space (Note 5).

Accordingly, leasehold fixtures and fittings were disposed of and a loss of $ 9,035 was recognized in the statement of comprehensive income (loss).

RIGHT OF USE ASSET

The Company entered into a lease agreement commencing July 1, 2017 and expiring June 30, 2022 consisting of approximately 6,600 square feet.

Subsequent to November 30, 2021, the Company entered into an agreement to terminate the office lease effective January 31, 2022.

The Company entered into a lease agreement commencing July 1, 2017 and expiring June 30, 2022 consisting of approximately 6,600 square feet of office space.

The Company mutually ended the lease agreement early effective January 31, 2022.

On adoption of ASC 842, Lease Accounting, the Company recognized right-of-use assets and a corresponding increase in lease liabilities, in the amount of $ 671,911 which represented the present value of future lease payments using a discount rate of 8 % per year.

1 unchanged sentence

Right of Use Asset Continuity

November 30, 2021

February 28, 2022

August 31, 2021

Balance, September 1

Exit of Operating Lease

Foreign Currency Translation Adjustment

Balance, End of Period

Destiny Media Technologies Inc.

NOTES TO CONDENSED CONSOLIDATED INTERIM

FINANCIAL STATEMENTS

As at February 28, 2022

RIGHT OF USE ASSET (cont'd)

The Company has operating lease payments committed as follows:

5 unchanged sentences

Operating Lease Liability Continuity

November 30, 2021

February 28, 2022

August 31, 2021

1 unchanged sentence

Less Lease Payments

Exit of Operating Lease

Foreign Currency Translation Adjustment

Balance, End of Period

During the three-month period ended November 30, 2021 the Company recorded depreciation expense of $ 57,284 (2020:

$ 54,636 ) which has been allocated between general and administrative expenses, research and development and sales and marketing on the consolidated statement of comprehensive income.

The total rent commitment, net of the leasehold improvement allowance, is being amortized to rent expense on a straight-line basis over the term of the lease.

On December 17, 2021, the Company entered into an agreement to terminate the property lease effective January 31, 2022.

During the three and six-month periods ended February 28, 2022 the Company recorded depreciation expense of $ 37,726 and $ 95,010 respectively (2021:

$ 56,455 and $ 111,091 ) which has been allocated between general and administrative expenses, research and development and sales and marketing on the consolidated statement of comprehensive income (loss).

The total rent commitment, net of the leasehold improvement allowance, was amortized to rent expense on a straight-line basis over the term of the lease.

On January 31, 2022, upon exit of the lease a gain of $ 20,053 was recognized in the statement of comprehensive income (loss).

Destiny Media Technologies Inc.

1 unchanged sentence

FINANCIAL STATEMENTS

November 30, 2021

As at February 28, 2022

STOCKHOLDERS' EQUITY

1 unchanged sentence

The Company is authorized to issue up to 20,000,000 shares of common stock, par value $ 0.001 per share.

Effective January 15, 2021, the Company commenced a Normal Course Issuer Bid ("NCIB"), pursuant to which the Company may purchase up to a maximum of 522,532 common shares, through the TSX Venture Exchange (the "TSX") at the market price at the time of purchase, subject to daily limits and compliance with the applicable rules of the TSX and Canadian securities laws.

During the three-month period ended November 30, 2021, the Company repurchased and cancelled 30,300 common shares for $ 44,166 .

As at November 30, 2021 a total of 215,585 shares had been repurchased for $ 304,570 under the NCIB.

[b] Stock option plan

On January 15, 2021, the Company commenced a Normal Course Issuer Bid ("NCIB"), pursuant to which the Company may purchase up to a maximum of 522,532 common shares, through the TSX Venture Exchange (the "TSX") at the market price at the time of purchase, subject to daily limits and compliance with the applicable rules of the TSX and Canadian securities laws.

During the six-month period ended February 28, 2022, the Company repurchased and cancelled 143,100 common shares for $ 179,401 .

At January 15, 2022, the Company had repurchased 328,385 common shares for $ 437,180 .

[b] Stock option plans

The Company has a stock option plan, namely the 2015 Stock Option Plan (the "2015 Plan"), under which up to 530,000 shares of common stock, has been reserved for issuance.

A total of Nil common shares remain eligible for issuance under the 2015 Plan.

Subsequent to November 30, 2021, the Company approved, subject to shareholder approval, a 2022 Stock Option plan, whereby 1,000,000 common shares would be reserved for issuance.

On February 18, 2022 the Company received shareholder approval for the 2022 Stock Option Plan (the "2022 Plan), whereby 1,000,000 common shares would be reserved for issuance.

As at February 28, 2022, 634,000 common shares remain eligible for issuance under the 2022 Plan.

The options generally vest over a range of periods from the date of grant, some are immediate, and others are 12 or 24 months.

4 unchanged sentences

FINANCIAL STATEMENTS

November 30, 2021

As at February 28, 2022

STOCKHOLDERS' EQUITY (cont'd.)

[b] Stock option plan (cont'd.)

[b] Stock option plans (cont'd.)

Stock-Based Payment Award Activity

A summary of stock option activity under the Plan as of November 30, 2021, and changes during the period then ended is presented below:

A summary of stock option activity under the Plans as of February 28, 2022, and changes during the period then ended is presented below:

Exercise Price

Outstanding at August 31, 2020

Outstanding at November 30, 2021

Exercisable at November 30, 2021

The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the quoted price of the Company's common stock for the options that were in-the-money at November 30, 2021.

The following table summarizes information regarding the non-vested options outstanding as of November 30, 2021 and changes during the period then ended:

Outstanding at February 28, 2022

Exercisable at February 28, 2022

The following table summarizes information regarding the non-vested options outstanding as of February 28, 2022 and changes during the period then ended:

Number of Options

Non-vested options at August 31, 2021

Non-vested options at November 30, 2021

As of November 30, 2021, there was $ 534,838 of total unrecognized compensation cost related to non-vested stock-based compensation awards.

Non-vested options at February 28, 2022

As of February 28, 2022, there was $ 478,476 of total unrecognized compensation cost related to non-vested stock-based compensation awards.

The unrecognized compensation cost is expected to be recognized over a weighted average period of 1.91 years.

2 unchanged sentences

FINANCIAL STATEMENTS

November 30, 2021

As at February 28, 2022

STOCKHOLDERS' EQUITY (cont'd.)

[b] Stock option plan (cont'd.)

Stock-Based Payment Award Activity (cont'd.)

Total stock-based compensation expense of $ 25,906 was recognized during the three month period ended November 30, 2021, (2020:

$ 12,849 ) is reported in the statement of comprehensive income as follows:

[b] Stock option plans (cont'd.)

During the six months ended February 28, 2022, the total stock-based compensation expense is reported in the statement of comprehensive income (loss) as follows:

Stock-based compensation

17 unchanged sentences

FINANCIAL STATEMENTS

November 30, 2021

As at February 28, 2022

STOCKHOLDERS' EQUITY (cont'd.)

6 unchanged sentences

The third-party plan agent is also responsible for the administration of the Plan on behalf of the Company and the participants.

During the three month period ended November 30, 2021, the Company recognized compensation expense of $ 17,227 (2020:

$ 15,186 ) in salaries and wages on the consolidated statement of comprehensive income in respect of the Plan, representing the Company's employee matching of cash contributions to the Plan.

During the three month period ended November 30, 2021, the shares were purchased on the open market at an average price of $ 1.48 (2020 :

The shares are held in trust for a period of one year from the date of purchase.

During the six month period ended February 28, 2022, the Company recognized compensation expense of $ 77,527 (2021:

$ 52,857 ) in salaries and wages on the consolidated statement of comprehensive income (loss) in respect of the Plan, representing the Company's employee matching of cash contributions to the Plan.

The shares were purchased on the open market at an average price of $ 1.29 (2021:

The shares are held in trust by the Company for a period of one year from the date of purchase.

[d] Earnings Per Share

Net income per common share (basic) is calculated by dividing net income by the weighted average number of common shares outstanding during the period.

Net income (loss) per common share (basic) is calculated by dividing net income by the weighted average number of common shares outstanding during the period.

Net income per common share (diluted) is calculated by dividing net income for the period by the weighted average number of common shares outstanding during the period, plus the dilutive effect of outstanding common share equivalents.

1 unchanged sentence

Under the treasury stock method, all common share equivalents have been exercised at the beginning of the period (or at the time of issuance, if later), and that the funds obtained thereby were used to purchase common shares of the Company at the average trading price of common shares during the period, but only if dilutive.

Weighted average shares outstanding

Dilutive impact of outstanding stock options

Diluted weighted average common shares outstanding

At November 30, 2021, the Company had an aggregate of 921,000 (August 31, 2021:

410,000 ) stock options outstanding.

For the three and six-month periods ended February 28, 2022 and 2021 the outstanding options, in the amount of 871,000 (August 31, 2021:

410,000 ), were anti-dilutive and have been excluded from the calculation of diluted income (loss) per share.

Destiny Media Technologies Inc.

1 unchanged sentence

FINANCIAL STATEMENTS

November 30, 2021

As at February 28, 2022

CONTINGENCIES

10 unchanged sentences

FINANCIAL STATEMENTS

November 30, 2021

As at February 28, 2022

CONCENTRATIONS AND ECONOMIC DEPENDENCE

1 unchanged sentence

Revenue from external customers, by product and location of customer, is as follows:

United States

Total Play MPE® Revenue

United States

Total Clipstream ® Revenue

Three Months Ended

Six Months Ended

North America

Total Play MPE®

North America

Total revenue

Revenue in the above table is based on location of the customer's billing address.

Some of these customers have distribution centres located around the globe and distribute around the world.

During the three month period ended November 30, 2021, the Company generated 37 % of total revenue from one customer respectively (2020 :

Some of these customers have distribution centers located around the globe and distribute around the world.

During the six months ended February 28, 2022, the Company generated 41 % of total revenue from one customer (2021 - 42 %).

It is in management's opinion that the Company is not exposed to significant credit risk.

As at November 30, 2021, one customer represented $ 272,449 (or 48 %) of the trade receivables balance (August 31, 2021, one customer represented $ 142,758 (or 36 %).

As at February 28, 2022, one customer represented $ 148,663 (or 25.5 %) of the trade receivables balance (August 31, 2021, one customer represented $ 142,758 (or 36 %)).

The Company has substantially all its assets in Canada and its current and planned future operations are, and will be, located in Canada.

COMPARATIVE FIGURES

Certain comparative figures have been reclassified to conform to the current period's presentation.

These reclassifications did not affect prior periods' net earnings.

Destiny Media Technologies Inc.

NOTES TO CONDENSED CONSOLIDATED INTERIM

FINANCIAL STATEMENTS

November 30, 2021

SUBSEQUENT EVENTS

On December 17, 2021 the Company entered into an agreement to terminate the office lease effective January 31, 2022.

The Company's lease was previously expected to terminate June 30, 2022.

On March 24, 2022, the Company entered into a twelve month office license agreement effective April 1, 2022 for $ 21,450 CDN.

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