Madison Technologies Inc. 10-Q

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operation. Shareholders’ Equity General. THE FOLLOWING PRESENTATION OF OUR PLAN OF OPERATION OF SHOULD BE READ IN CONJUNCTION WITH THE AUDITED CONSOLIDATED FINANCIAL STATEMENTS AND OTHER FINANCIAL INFORMATION INCLUDED HEREIN. RESULTS OF OPERATIONS Our consolidated financial statements included herein have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation. We expect we will require additional capital to meet our long-term operating requirements. We expect to raise additional capital through, among other things, the sale of stock or debt securities and further implement our business plan. Three Months Ended March 31, 2025 and 2024 General and administrative expenses General and administrative expenses increased to $60,976 for the three months ended March 31, 2025, from $15,472 for the three months ended March 31, 2024. The increase was primarily because of the expenses necessary to process our SEC filings. Professional Fees Professional fees decreased to $56,904 for the three months ended March 31, 2025, from $124,703 for the three months ended March 31, 2024. The decrease was primarily because of the expenses incurred in the quarter ended March 31, 2024 for the transfer of Sovryn to the Investors that resulted in a $9,159,907 reduction in principal on the senior secured notes on February 1, 2023. Amortization expense and interest expense Total amortization expense and interest expense decreased to $Nil for the three months ended March 31, 2025, from $130,226 for the three months ended March 31, 2024. Amortization expense is derived from discounts recognized when we issued debt and then amortized the discount over the terms of the debt. Most of our debt matured in 2023 and the discounts were fully amortized in 2023. In 2024, we amortized all the remaining debt discounts. Net Loss Net loss decreased to $709,477 for the three months ended March 31, 2025, from $830,912 for the three months ended March 31, 2024. The decrease was primarily the result of decreases in amortized interest expense and professional fees that was partially offset by an increase in general and administrative expenses. The net loss per basic and diluted share was $0.0004 and $0.0005, respectively, with basic and diluted weighted averages shares outstanding of 1,603,095,243 for the respective periods. Liquidity and Capital Resources Cash and Working Capital As at March 31, 2025, we had $Nil in cash and a $21,095,772 working capital deficit, compared to cash of $Nil and working capital deficit of $20,386,294 as at December 31, 2023. The increase in the working capital deficit primarily resulted from the accrual of interest on our debt. We will require additional capital to meet our long- and short-term operating requirements. For the three months ended March 31, 2025, our principal source of liquidity was our cash that we obtained from funds provided by the Investors. Our principal use of cash was to fund operations. We expect that the principal uses of cash in the future will be for continuing operations associated with rolling out our business plan and repayment of notes payable that are not converted into our Common Stock or renegotiated. Net Cash Used in Continuing Operating Activities We used $90,693 in cash from continuing operating activities for the three months ended March 31, 2025, compared to cash used of $140,496 from continuing operating activities during the three months ended March 31, 2024. Net Cash Provided by Financing Activities Net cash provided by financing activities was $90,693 during the three months ended March 31, 2025, compared to $140,496 of cash provided by financing activities during the three months ended March 31, 2024. 30 No cash was used in investing activities during the three months ended March 31, 2025 and 2024. Going Concern The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company has suffered recurring losses from operations and has a significant accumulated deficit. In addition, the Company continues to experience negative cash flow from operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Management’s plans in regards to this matter include raising additional equity financing and borrowing funds under a private credit facility and/or other credit sources. Off-Balance Sheet Arrangements We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders. Item 3. Quantitative and Qualitative Disclosures About Market Risk. Not applicable.