What changed in this filing

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Item 2. Management’s Discussion and Analysis

2022-11-08 compared with 2022-08-09 · 90 added, 85 removed, 176 unchanged (50% of the section changed)

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If we are unable to meet end-user or customer volume or performance expectations, then our business prospects and operating results may be adversely affected.

Effects of the COVID-19 Pandemic on our Business.

In March 2020, the World Health Organization characterized the coronavirus (“COVID-19”) a pandemic, and the President of the United States declared the COVID-19 outbreak a national emergency.

The rapid spread of the pandemic and the continuously evolving responses to combat it have had an increasingly negative impact on the global economy.

In view of the rapidly changing business environment created by the uncertainty related to the depth and or duration of the impact resulting from COVID-19, we have experienced delays in our sales in select vertical markets and are currently unable to determine if there will be any continued disruption and the extent to which this may have future impact on our business .

We continue to monitor the progression of the pandemic and its effect on our financial position, results of operations, and cash flows.

Impacts of Macroeconomic Conditions and Other Factors on our Business

In March 2020, the World Health Organization declared the outbreak of COVID-19 as a pandemic.

The rapid spread of the pandemic and the continuously evolving responses to combat it have had an increasingly negative impact on the global economy, including industry-wide global supply chain challenges, such as manufacturing, transportation and logistics.

We purchase certain products and key components from a limited number of sources that depend on the supply chain, including freight, to receive components,

transport finished goods and deliver our products across the world.

In view of the rapidly changing business environment, we have experienced delays and reductions in customer orders, shifting supply chain availability, component shortages, and other production- related challenges.

We are currently unable to determine if there will be any continued disruption and the extent to which this may have future impact on our business .

We continue to monitor the global supply chain challenges and its effect on our financial position, results of operations, and cash flows.

More recently, we have also been impacted by other a dverse macroeconomic conditions, including but not limited to, inflation, foreign currency fluctuations, and the slowdown of economic activity around the globe.

These conditions have also impacted our suppliers, contract manufacturers, logistics providers, and distributors, causing increases in cost of materials and higher shipping and transportation rates, which then impacted the pricing of our products.

Price increases may not successfully offset cost increases or may cause us to lose market share and, in turn, may adversely impact our financial position, results of operations, and cash flows .

Results of Operations

The following table includes net revenue and net profit information by business segment and reconciles gross profit to income (loss) before income tax provision (in thousands).

Three Months Ended June 30,

Six Months Ended June 30,

The following table includes net revenue and net profit information by business segment and reconciles gross profit to income (loss) before income tax benefit (provision) (in thousands).

Three Months Ended September 30,

Nine Months Ended September 30,

Gross profit margin

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Total operating expenses:

Loss from operations

Income (loss) from operations

Non-operating income (expense):

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Gain on investment

Foreign currency gains, net

Income (loss) before income tax provision

Foreign currency gains (losses), net

Income (loss) before income tax benefit (provision)

Geographic net revenue based on each customer’s ship-to location is as follows (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Europe and the Middle East

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Europe and the Middle East

Net revenue for the three months ended June 30, 2022 was $27.9 million, an increase of 16% compared with $24.0 million for the comparable period of 2021 .

Net revenue in the Americas was $17.6 million for the three months ended June 30, 2022, an increase of 24% compared to $14.2 million for the comparable period of 2021.

Net revenue in Europe, the Middle East, and the Asia-Pacific was approximately $10.2 million for the three months ended June 30, 2022, an increase of 4% compared with the comparable period of 2021.

Net revenue for the six months ended June 30, 2022 was $52.9 million, an increase of 15% compared with $46.2 million for the comparable period of 2021 .

Net revenue in the Americas was $34.5 million for the six months ended June 30, 2022, an increase of 18% compared to $29.4 million for the comparable period of 2021.

Net revenue in Europe, the Middle East, and the Asia-Pacific was approximately $18.4 million for the six months ended June 30, 2022, an increase of 9% compared with the comparable period of 2021.

Net revenue for the three months ended September 30, 2022 was $31.0 million, an increase of 7% compared with $29.1 million for the comparable period of 2021 .

Net revenue in the Americas was $21.0 million for the three months ended September 30, 2022, an increase of 7% compared to $19.7 million for the comparable period of 2021.

Net revenue in Europe, the Middle East, and the Asia-Pacific was approximately $10.0 million for the three months ended September 30, 2022, an increase of 7% compared with the comparable period of 2021.

Net revenue for the nine months ended September 30, 2022 was $83.9 million, an increase of 12% compared with $75.3 million for the comparable period of 2021 .

Net revenue in the Americas was $55.5 million for the nine months ended September 30, 2022, an increase of 13% compared to $49.0 million for the comparable period of 2021.

Net revenue in Europe, the Middle East, and the Asia-Pacific was approximately $28.4 million for the nine months ended September 30, 2022, an increase of 8% compared with the comparable period of 2021.

Identity Segment

Net revenue in our Identity segment was $16.9 million for the three months ended June 30, 2022, an increase of 14% compared with $14.8 million for the comparable period of 2021.

For the six months ended June 30, 2022, net revenue in this segment was $31.5 million, an increase of 11% compared with $28.5 million for the comparable period of 2021.

Net revenue in this segment for the three and six months ended June 30, 2022 represented 61% and 60%, respectively, of our net revenue, compared to 62% and 62% in the comparable periods of the prior year.

Net revenue in this segment in the Americas for the three and six months ended June 30, 2022 , increased 28% and 12%, respectively, compared with the comparable periods of 2021.

These increases were primarily due to higher sales of RFID transponder products to mobile phone and consumer products contract manufacturers and higher sales of access cards , offset by lower sales of smart card readers resulting from critical component supply-chain constraints.

Net revenue in this segment in Europe, the Middle East, and the Asia-Pacific for the three and six months ended June 30, 2022, increased 6% and 9%, respectively, compared with the comparable periods of 2021.

These increases were primarily due to higher sales of RFID transponder products to existing customers in the medical device and library markets, as well as higher sales of access cards.

Net revenue in our Identity segment was $19.2 million for the three months ended September 30, 2022, an increase of 2% compared with $18.7 million for the comparable period of 2021.

For the nine months ended September 30, 2022, net revenue in this segment was $50.6 million, an increase of 7% compared with $47.2 million for the comparable period of 2021.

Net revenue in this segment for the three and nine months ended September 30, 2022 represented 62% and 60%, respectively, of our net revenue, compared to 64% and 63% in the comparable periods of the prior year.

Net revenue in this segment in the Americas for the three months ended September 30, 2022 were comparable to the three months ended September 31, 2021, while for the nine months ended September 30, 2022, net revenue increased 6% compared with the comparable period of 2021.

The increase was primarily due to higher sales of RFID transponder products to consumer products contract manufacturers and higher sales of access cards , offset by lower sales of our legacy smart card readers resulting from critical component supply-chain constraints.

Net revenue in this segment in Europe, the Middle East, and the Asia-Pacific for the three and nine months ended September 30, 2022, increased 7% and 8%, respectively, compared with the comparable periods of 2021.

These increases were primarily due to higher sales of RFID transponder products to existing customers in the medical device and library markets .

Premises Segment

Net revenue in our Premises segment was $10.9 million for the three months ended June 30, 2022, an increase of 19% compared with $9.2 million for the comparable period of 2021.

For the six months ended June 30, 2022, net revenue in this segment was $21.4 million, an increase of 21% compared with $17.7 million for the comparable period of 2021.

Net revenue in our Premises segment for the three and six months ended June 30, 2022 represented 39% and 40%, respectively, of our net revenue, compared to 38% and 38% in the comparable periods of the prior year.

Net revenue in this segment in the Americas for the three and six months ended June 30, 2022 increased 21% and 22%, respectively, compared with the comparable periods of 2021 due to higher sales of Hirsch Velocity hardware, software, and related support services, as well as video product offerings to customers in select commercial verticals.

Net revenue in this segment across Europe, the Middle East, and the Asia-Pacific for the three months ended June 30, 2022 decreased 10% compared with the comparable period of 2021, while net revenue for the six months ended June 30, 2022 increased 11% compared with the comparable period of 2021.

Net revenue in these regions are primarily project driven and can vary period to period.

Net revenue in our Premises segment was $11.8 million for the three months ended September 30, 2022, an increase of 14% compared with $10.4 million for the comparable period of 2021.

For the nine months ended September 30, 2022, net revenue in this segment was $33.3 million, an increase of 19% compared with $28.1 million for the comparable period of 2021.

Net revenue in our Premises segment for the three and nine months ended September 30, 2022 represented 38% and 40%, respectively, of our net revenue, compared to 36% and 37% in the comparable periods of the prior year.

Net revenue in this segment in the Americas for the three and nine months ended September 30, 2022 increased 15% and 20%, respectively, compared with the comparable periods of 2021 due to higher sales of Hirsch Velocity hardware, software, support services, and video product offerings across both federal government and commercial businesses.

Net revenue in this segment across Europe, the Middle East, and the Asia-Pacific for the three and nine months ended September 30, 2022 increased 4% and 9%, respectively, compared with the comparable periods of 2021.

Net revenue in these regions is primarily project driven and can vary period to period.

As a general trend, U.S.

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Gross Profit and Gross Margin

Gross profit for the three months ended June 30, 2022 was $10.2 million, or 37% of net revenue, compared with $8.8 million, or 37% of net revenue in the comparable period of 2021.

Gross profit for the six months ended June 30, 2022 was $19.2 million, or 36% of net revenue, compared with $16.5 million, or 36% of net revenue in the comparable period of 2021.

Gross profit for the three months ended September 30, 2022 was $11.2 million, or 36% of net revenue, compared with $11.1 million, or 38% of net revenue in the comparable period of 2021.

Gross profit for the nine months ended September 30, 2022 was $30.4 million, or 36% of net revenue, compared with $27.7 million, or 37% of net revenue in the comparable period of 2021.

Gross profit represents net revenue less direct cost of product sales, manufacturing overhead, other costs directly related to preparing the product for sale including freight, scrap, inventory adjustments and amortization, where applicable.

Identity Segment

In our Identity segment, gross profit in the three and six months ended June 30, 2022 was $4.0 million and $7.1 million, respectively, compared with $3.6 million and $6.9 million in the comparable periods of 2021.

Gross profit margins in the Identity segment for the three months ended June 30, 2022 was comparable to the same period of 2021.

Gross profit margins in the Identity segment decreased to 23% in the six months ended June 30, 2022 from 24% in the comparable period of 2021.

The decrease in gross profit margins was primarily attributable to continued investments in technology and manufacturing processes and systems and changes in product mix, with a higher proportion of lower margin RFID transponder product sales.

In our Identity segment, gross profit in the three and nine months ended September 30, 2022 was $4.3 million and $11.5 million, respectively, compared with $5.2 million and $12.1 million, respectively, in the comparable periods of 2021.

Gross profit margins in the Identity segment for the three and nine months ended September 30, 2022 decreased to 23% and 23%, respectively, from 28% and 26%, respectively, in the comparable periods of 2021.

These decreases in gross profit margins were primarily attributable to continued investments in technology, manufacturing processes and equipment, and changes in product mix, with lower sales of higher margin legacy smart card readers and higher sales of lower margin RFID transponder products.

Premises Segment

In our Premises segment, gross profit was $6.2 million in the three months ended June 30, 2022 compared with $5.3 million in the comparable period of 2021.

Gross profit margins in the Premises segment for the three months ended June 30, 2022 was comparable to the same period of 2021.

Gross profit was $12.0 million in the six months ended June 30, 2022 compared with $9.6 million in the comparable period of 2021.

Gross profit margins in the Premises segment increased to 56% in the six months ended June 30, 2022 from 54% in the comparable period of 2021 primarily due to product mix as well as the impact resulting from our focus on operational efficiencies.

In our Premises segment, gross profit in the three and nine months ended September 30, 2022 was $6.9 million and $18.9 million, respectively, compared with $5.9 million and $15.5 million, respectively, in the comparable periods of 2021.

Gross profit margins in the three and nine months ended September 30, 2022 increased to 58% and 57%, respectively, from 57% and 55%, respectively, compared to the same periods in 2021.

These increases were primarily due to product mix as well as the impact resulting from our continued focus on production and logistical efficiencies.

We expect there will be variation in our total gross profit from period to period, as our gross profit has been and will continue to be affected primarily by varying mix among our products.

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Operating Expenses

Information about our operating expenses for the three and six months ended June 30, 2022 and 2021 is set forth below (dollars in thousands).

Information about our operating expenses for the three and nine months ended September 30, 2022 and 2021 is set forth below (dollars in thousands).

Research and Development

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Research and development

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We focus the bulk of our research and development activities on the continued development of existing products and the development of new offerings for emerging market opportunities.

Research and development expenses for the three and six months ended June 30, 2022 increased compared to the comparable prior year periods primarily due to higher headcount and related costs as well as higher stock-based compensation costs associated with PSUs.

Research and development expenses for the three and nine months ended September 30, 2022 increased compared to the comparable prior year periods primarily due to higher headcount and related costs as well as higher stock-based compensation costs associated with PSUs.

Selling and Marketing

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Selling and marketing

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Selling and marketing expenses consist primarily of employee compensation as well as amortization expense of certain intangible assets, customer lead generation activities, tradeshow participation, advertising and other marketing and selling costs.

Selling and marketing expenses for the three and six months ended June 30, 2022 increased compared to the comparable prior year periods primarily due to higher salaries and benefits costs as well as higher trade show and related costs.

Selling and marketing expenses for the three months ended September 30, 2022 increased compared to the three months ended September 30, 2021 primarily due to higher headcount and related costs.

Selling and marketing expenses for the nine months ended September 30, 2022 increased compared to the comparable period of 2021 primarily due to higher headcount and related costs, higher external contractor costs as well as higher travel related costs.

General and Administrative

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

General and administrative

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General and administrative expenses consist primarily of compensation expenses for employees performing administrative functions, and professional fees incurred for legal, auditing and other consulting services.

General and administrative expense for the three months ended June 30, 2022 decreased compared to the prior year period primarily due t o higher bad debt expense recorded in the second quarter of 2021, partially offset by higher headcount and related costs.

General and administrative expense for the six months ended June 30, 2022 increased compared to the prior year period primarily due t o higher headcount and related costs.

General and administrative expense for the three and nine months ended September 30, 2022 increased compared to the prior year periods primarily due t o higher headcount and related costs, partially offset by lower merchant card fees in 2022 compared to 2021.

Restructuring and Severance Charges

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Restructuring and severance

Restructuring expense for the three and six months ended June 30, 2022, consisted of severance related costs of $221,000 and $234,000, respectively.

Restructuring expense for the three and nine months ended September 30, 2022, consisted of severance related costs of $49,000 and $283,000, respectively.

In the first quarter of 2022, we entered into a settlement agreement associated with outstanding rental payments due the landlord on leased office space in San Francisco, California.

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Non-operating Income (Expense)

Information about our non-operating income (expense) for the three and six months ended June 30, 2022 and 2021 is set forth below (dollars in thousands).

Three Months Ended June 30,

Six Months Ended June 30,

Information about our non-operating income (expense) for the three and nine months ended September 30, 2022 and 2021 is set forth below (dollars in thousands).

Three Months Ended September 30,

Nine Months Ended September 30,

Interest expense, net

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Gain on investment

Foreign currency gains, net

Foreign currency gains (losses), net

Interest expense, net consists of interest on financial liabilities, amortization of debt issuance costs, and interest accretion expense for a liability on a contractual payment obligation arising from our acquisition of Hirsch Electronics Corporation.

The decrease in interest expense for the three and six months ended June 30, 2022 compared to the comparable period of 2021 was attributable to lower borrowings outstanding under our revolving loan facility with our lender (which was fully paid down in August 2021), and lower amounts outstanding under our contractual payment obligations (all amounts outstanding had been paid as of December 31, 2021).

The decrease in interest expense for the three and nine months ended September 30, 2022 compared to the comparable period of 2021 was attributable to lower borrowings outstanding under our revolving loan facility with our lender (which was fully paid down in August 2021), and lower amounts outstanding under our contractual payment obligations (all amounts outstanding had been paid as of December 31, 2021).

Changes in currency valuation in the periods mainly were the result of exchange rate movements between the U.S.

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Our foreign currency gains and losses primarily result from the valuation of current assets and liabilities denominated in a currency other than the functional currency of the respective entity in the local financial statements.

Income Tax Provision

Three Months Ended June 30,

Six Months Ended June 30,

Income tax provision

Income Tax Benefit (Provision)

Three Months Ended September 30,

Nine Months Ended September 30,

Income tax benefit (provision)

Effective tax rate

As of June 30, 2022, our deferred tax assets are fully offset by a valuation allowance.

As of September 30, 2022, our deferred tax assets are fully offset by a valuation allowance.

Accounting Standards Codification (“ASC”) 740, Income Taxes , provides for the recognition of deferred tax assets if realization of such assets is more likely than not.

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If it is later determined that a portion or all of the valuation allowance is not required, it generally will be a benefit to the income tax provision in the period such determination is made.

We recorded an income tax provision during the three and six months ended June 30, 2022.

The effective tax rates for the three and six months ended June 30, 2022 and 2021 differ from the federal statutory rate of 21% primarily due to a change in valuation allowance, and the provision or benefit in certain foreign jurisdictions, which are subject to higher tax rates.

We recorded an income tax benefit (provision) during the three and nine months ended September 30, 2022.

The effective tax rates for the three and nine months ended September 30, 2022 and 2021 differ from the federal statutory rate of 21% primarily due to a change in valuation allowance, and the provision or benefit in certain foreign jurisdictions, which are subject to higher tax rates.

Liquidity and Capital Resources

As of June 30, 2022, our working capital, defined as current assets less current liabilities, was $50.8 million, a decrease of $1.1 million compared to $51.9 million as of December 31, 2021.

As of June 30, 2022, our cash and cash equivalents balance was $25.0 million.

As of September 30, 2022, our working capital, defined as current assets less current liabilities, was $50.7 million, a decrease of $1.2 million compared to $51.9 million as of December 31, 2021.

As of September 30, 2022, our cash and cash equivalents balance was $21.2 million.

On February 8, 2017, we entered into a Loan and Security Agreement with East West Bank (“EWB”).

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The non-formula revolving loan facility terminated on February 7, 2022.

On April 14, 2022, we amended the Loan and Security Agreement, replacing the $20.0 million revolving loan facility subject to a borrowing base with a non-formula revolving loan facility with no borrowing base requirement and a maturity date of February 8, 2023.

On April 14, 2022, we amended the Loan and Security Agreement, replacing the $20.0 million revolving loan facility subject to a borrowing base with a $20.0 million non-formula revolving loan facility with no borrowing base requirement and a maturity date of February 8, 2023.

In addition, the interest rate was lowered from prime to prime minus 0.25% , and certain financial covenants were amended.

As of June 30, 2022, there were no amounts outstanding and we were in compliance with all financial covenants under the Loan and Security Agreement.

As of September 30, 2022, there were no amounts outstanding and we were in compliance with all financial covenants under the Loan and Security Agreement.

As our previously unremitted earnings have been subjected to U.S.

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We have access to the cash held outside the United States to fund domestic operations and obligations without any material income tax consequences.

As of June 30, 2022, the amount of cash included at such subsidiaries was $5.1 million.

As of September 30, 2022, the amount of cash included at such subsidiaries was $4.4 million.

We have not, nor do we anticipate the need to, repatriate funds to the United States to satisfy domestic liquidity needs arising in the ordinary course of business, including liquidity needs associated with our domestic debt service requirements.

We have historically incurred operating losses and negative cash flows from operating activities, and we may continue to incur losses in the future.

As of June 30, 2022, we had an accumulated deficit of $410.2 million.

During the six months ended June 30, 2022, we had a net loss of $1.3 million.

W e have historically incurred operating losses and negative cash flows from operating activities, and we may continue to incur losses in the future.

As of September 3 0 , 20 2 2 , we had a n a ccumulated deficit of $ 4 0 9 .

During the nine months ended September 3 0 , 20 2 2 , we had a net loss of $ 0.

We believe our existing cash and cash equivalents, together with cash generated from operations and available credit under our Loan and Security Agreement will be sufficient to satisfy our working capital needs to fund operations for the next 12 months.

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If we are not able to secure additional funding when needed, we may have to curtail or reduce the scope of our business or forgo potential business opportunities.

The following summarizes our cash flows for the six months ended June 30 , 20 2 2 and 20 2 1 (in thousands):

Six Months Ended June 30,

Net cash used in operating activities

The following summarizes our cash flows for the nine months ended September 30, 2022 and 2021 (in thousands):

Nine Months Ended September 30,

Net cash provided by (used in) operating activities

Net cash used in investing activities

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Cash flows from operating activities

Cash used in operating activities for the six months ended June 30, 2022 of $0.9 million, was primarily due to net loss of $1.3 million, a decrease in cash from net changes in operating assets and liabilities of $2.4 million, offset by adjustments for certain non-cash items of $2.8 million, consisting primarily of depreciation, amortization and stock-based compensation.

Cash used in operating activities for the six months ended June 30, 2021 of $2.9 million was primarily due to a decrease in cash from net changes in operating assets and liabilities of $3.7 million, and adjustments for certain non-cash items of $0.1 million, consisting primarily of depreciation, amortization, stock-based compensation, gain on forgiveness of debt and impairment of a right-of-use operating lease asset, partially offset by net income of $1.0 million.

Cash used in operating activities for the nine months ended September 30, 2022 of $3.0 million, was primarily due to net loss of $0.7 million, a decrease in cash from net changes in operating assets and liabilities of $6.5 million, which included $5.2 million in strategic inventory purchases, partially offset by adjustments for certain non-cash items of $4.2 million, consisting primarily of depreciation, amortization and stock-based compensation.

Cash provided by operating activities for the nine months ended September 30, 2021 of less than $0.1 million was primarily due to net income of $3.5 million, and adjustments for certain non-cash items of $0.4 million, consisting primarily of depreciation, amortization, stock-based compensation, gain on forgiveness of the Paycheck Protection Program note and impairment of a right-of-use operating lease asset, offset by a decrease in cash from net changes in operating assets and liabilities of $3.9 million.

Cash flows from investing activities

Cash used in investing activities for the six months ended June 30, 2022 and 2021 was $1.6 million and $1.7 million, respectively, which related to capital expenditures in our manufacturing facility in Singapore and our research and development facility in Germany.

Cash used in investing activities for the nine months ended September 30, 2022 was $3.0 million, which related to capital expenditures in our manufacturing facility in Singapore and our research and development facility in Germany.

Cash used in investing activities for the nine months ended September 30, 2021 was $1.3 million, which related to capital expenditures in our manufacturing facility in Singapore and our research and development facility in Germany, partially offset by $0.6 million related to proceeds received from an investment in connection with the acquisition of a private company that we had invested in, which had been fully impaired and had no carrying value.

Cash flows from financing activities

Cash used in financing activities during the six months ended June 30, 2022 was $0.6 million, which related to net share settlement of restricted stock units.

Cash provided by financing activities during the six months ended June 30, 2021 was primarily due to net proceeds of $37.7 million received from the sale of common stock in our underwritten public offering and $0.1 million of proceeds from the exercise of stock options, partially offset by net repayments under our revolving loan facility of $4.6 million, repayments of April 21 Funds promissory notes of $2.8 million and taxes paid related to net share settlement of restricted stock units of $0.6 million.

Cash used in financing activities during the nine months ended September 30, 2022 was $0.9 million, which related to net share settlements of restricted stock units.

Cash provided by financing activities during the nine months ended September 30, 2021 was primarily due to net proceeds of $37.7 million received from the sale of common stock in our underwritten public offering, partially offset by net repayments under our revolving loan facility of $14.6 million, repayments of April 21 Funds promissory notes of $2.8 million and taxes paid related to net share settlements of restricted stock units of $0.9 million.

Off-Balance Sheet Arrangements

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Despite our intention to establish accurate estimates and assumptions, actual results may differ from these estimates under different assumptions or conditions.

During the three months ended June 30, 2022, management believes there have been no significant changes to the items that we disclosed within our critical accounting policies and estimates in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2021.

During the three months ended September 30, 2022, management believes there have been no significant changes to the items that we disclosed within our critical accounting policies and estimates in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2021.

Recent Accounting Pronouncements

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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