• BEN Reports Third Quarter 2024 Financial Results

    Источник: Nasdaq GlobeNewswire / 14 ноя 2024 16:10:52   America/New_York

    JACKSON, Wyo., Nov. 14, 2024 (GLOBE NEWSWIRE) -- Brand Engagement Network Inc. (“BEN”) (Nasdaq: BNAI), a global leader in secure and reliable conversational AI solutions, today announced its financial results and key business highlights for the third quarter ended September 30, 2024.

    "In the third quarter, we made significant progress in delivering secure, scalable AI solutions and advancing our mission to transform industries with intelligent technology," said Paul Chang, CEO of BEN. "As we look ahead, BEN is poised to accelerate growth and deliver value to our customers, reinforcing our leadership in closed-loop Gen AI."

    Q3 2024 Key Business Highlights:

    • KangarooHealth Partnership: BEN partnered with KangarooHealth to enhance remote patient monitoring and chronic care management through AI, aiming to scale their platform for patients with chronic conditions.
    • IntelliTek Collaboration: BEN’s agreement with IntelliTek broadens global access to AI solutions for healthcare, supporting patient engagement and optimizing healthcare operations across multiple regions.
    • INTERVENT & Members Only Health Contracts: BEN signed with INTERVENT and Members Only Health to deploy AI assistants for health coaching and in-home healthcare, enhancing patient engagement and access.
    • Vybroo & Farmacia Roma Partnership: BEN collaborated with Vybroo and Farmacia Roma to offer AI-driven audio engagement, enhancing brand-consumer relationships through accessible, everyday channels.
    • New SEPA Agreement: BEN entered into a $50 million Standby Equity Purchase Agreement (SEPA) with Yorkville Advisors, providing financial flexibility.
    • Leadership Promotion: Paul Chang was promoted to CEO, reinforcing BEN’s commitment to strategic growth and customer-focused initiatives.
    • New Board Member: Dr. Richard S. Isaacs, former CEO of Kaiser Permanente, was appointed to BEN's board of directors, bringing healthcare technology innovation and leadership expertise.

    Q3 2024 Financial Overview:

    • Revenue Growth: Achieved increase in revenue compared to the same period last year, driven by new partnerships and market expansion.
    • Operational Efficiency: Improved operational metrics through continued cost discipline, resulting in a sequential reduction in operating costs and quarter-over-quarter operating loss improvement, coupled with strategic collaborations and technology advancements.
    • Cash Position: Quarter over-quarter sequential improvement in Cash Flow from Operations driven by disciplined cost management. Implementing the Standby Equity Purchase Agreement (SEPA) provided cost-effective and efficient access to capital and liquidity.
    • Significant subsequent event: In October, the Company announced its agreement to acquire 100% of Cantaneo Gmbh, a leading media technology company based in Germany, for $19.5 million in cash and stock. BEN expects to close this transaction by the end of the year.

    Conference Call and Webcast Information
    The Company will host a conference call and webcast today, Thursday, November 14, 2024, at 5:00 p.m. ET. CEO Paul Chang and CFO Bill Williams will lead the call, introducing Tina, one of BEN’s AI Assistants.

    Participants can register here to access the live webcast of the conference call. Those who prefer to join the call via phone can register using this link to receive a dial-in number and unique PIN.

    The webcast will be archived for one year following the conference call and can be accessed on BEN’s investor relations website at https://investors.beninc.ai/.

    For more information about BEN’s safe, intelligent, scalable AI, please visit www.beninc.ai.

    About BEN
    Brand Engagement Network Inc. is a global leader in providing secure and reliable conversational AI solutions for businesses and consumers. With offices in Jackson, Wyoming, and Seoul, South Korea, BEN offers a powerful and flexible platform that enhances customer experiences, boosts productivity, and delivers business value. At the heart of BEN’s offerings are AI-powered digital assistants and lifelike avatars, providing more personal and engaging experiences through browsers, mobile applications, and even life-size kiosks. These safe, intelligent, and inherently scalable AI solutions empower businesses to efficiently serve customers using validated data delivered through SaaS, Private Cloud, and On-Premises technology. BEN’s commitment to data sovereignty ensures that consumer and business data remain private, protected, and wholly owned by the respective parties. BEN’s mission is to make AI friendly and helpful for all, ensuring more people benefit from the AI-enhanced world. For more information about BEN’s safe, intelligent, scalable AI, please visit www.beninc.ai.

    Forward-Looking Statements

    This communication contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are not historical facts, and involve risks and uncertainties that could cause actual results of BEN to differ materially from those expected and projected. These forward-looking statements can be identified by the use of forward-looking terminology, including the words “anticipates,” “believes,” “continue,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts,” “projects,” “should,” “will,” or “would,” or, in each case, their negative or other variations or comparable terminology.

    These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results. Most of these factors are outside BEN’s control and are difficult to predict. Factors that may cause such differences include, but are not limited to: uncertainties as to the timing of the acquisition with Cataneo Gmbh (the “Acquisition”); the risk that the Acquisition may not be completed on the anticipated terms in a timely manner or at all; (the failure to satisfy any of the conditions to the consummation of the Acquisition, including the ability to obtain financing to fund the Acquisition on terms that are agreeable to the parties or at all; the possibility that any or all of the various conditions to the consummation of the Acquisition may not be satisfied or waived; the occurrence of any event, change or other circumstance that could give rise to the termination of the purchase agreement; the effect of the announcement or pendency of the transactions contemplated by the purchase agreement on the Company’s ability to retain and hire key personnel, its ability to maintain relationships with its customers, suppliers and others with whom it does business, or its operating results and business generally; risks related to diverting management’s attention from the Company’s ongoing business operations; uncertainty as to the timing of completion of the Acquisition; risks that the benefits of the Acquisition are not realized when and as expected; risks relating to the uncertainty of the projected financial information with respect to BEN; uncertainty regarding and the failure to realize the anticipated benefits from future production-ready deployments; the attraction and retention of qualified directors, officers, employees and key personnel; our ability to grow our customer base; BEN’s history of operating losses; BEN’s need for additional capital to support its present business plan and anticipated growth; technological changes in BEN’s market; the value and enforceability of BEN’s intellectual property protections; BEN’s ability to protect its intellectual property; BEN’s material weaknesses in financial reporting; BEN’s ability to navigate complex regulatory requirements; the ability to maintain the listing of BEN’s securities on a national securities exchange; the ability to implement business plans, forecasts, and other expectations; the effects of competition on BEN’s business; and the risks of operating and effectively managing growth in evolving and uncertain macroeconomic conditions, such as high inflation and recessionary environments. The foregoing list of factors is not exhaustive.

    BEN cautions that the foregoing list of factors is not exclusive. BEN cautions readers not to place undue reliance upon any forward-looking statements, which speak only as of the date made. BEN does not undertake nor does it accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based, and it does not intend to do so unless required by applicable law. Further information about factors that could materially affect BEN, including its results of operations and financial condition, is set forth under “Risk Factors” in BEN’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q subsequently filed with the Securities and Exchange Commission.

    BEN Contacts:

    Investor Relations
    Susan Xu
    E: sxu@allianceadvisors.com
    P: 778-323-0959

    Media Contact
    Amy Rouyer
    E: amy@beninc.ai
    P: 503-367-7596

    Source: Brand Engagement Network, Inc. (BEN)

    BRAND ENGAGEMENT NETWORK INC.
    UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
     
     September 30, 
    2024    		 December 31,
    2023*
    ASSETS   
    Current assets:   
    Cash and cash equivalents$72,878  $1,685,013 
    Accounts receivable, net of allowance 30,888   10,000 
    Due from Sponsor 3,000   — 
    Prepaid expenses and other current assets 1,075,103   201,293 
    Total current assets 1,181,869   1,896,306 
    Property and equipment, net 285,305   802,557 
    Intangible assets, net 17,006,906   17,882,147 
    Other assets 13,475,000   1,427,729 
    TOTAL ASSETS$31,949,080  $22,008,739 
    LIABILITIES AND STOCKHOLDERS’ EQUITY   
    Current liabilities:   
    Accounts payable$5,376,310  $1,282,974 
    Accrued expenses 4,185,315   1,637,048 
    Due to related parties 693,036   — 
    Deferred revenue —   2,290 
    Convertible note 1,900,000   — 
    Short-term debt 891,974   223,300 
    Total current liabilities 13,046,635   3,145,612 
    Warrant liabilities 1,150,868   — 
    Note payable - related party —   500,000 
    Long-term debt —   668,674 
    Total liabilities 14,197,503   4,314,286 
    Commitments and contingencies (Note M)   
    Stockholders’ equity:   
    Preferred stock par value $0.0001 per share, 10,000,000 shares authorized, none designated. There are no shares issued or outstanding as of September 30, 2024 or December 31, 2023 —   — 
    Common stock par value of $0.0001 per share, 750,000,000 shares authorized. As of September 30, 2024 and December 31, 2023, respectively, 37,931,764 and 23,270,404 shares issued and outstanding 3,794   2,327 
    Additional paid-in capital 46,806,699   30,993,846 
    Accumulated deficit (29,058,916)  (13,301,720)
    Total stockholders’ equity 17,751,577   17,694,453 
    TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY$31,949,080  $22,008,739 
        
    * Derived from audited information   
     

    The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.


    BRAND ENGAGEMENT NETWORK INC.
    UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
     
     Three Months Ended
    September 30,    		 Nine Months Ended
    September 30,
      2024   2023   2024   2023 
    Revenues$50,000  $—  $99,790  $— 
    Cost of revenues —   —   —   — 
    Gross profit 50,000   —   99,790   — 
    Operating expenses:       
    General and administrative 4,203,946   2,282,434   15,969,617   7,678,880 
    Depreciation and amortization 972,375   209,729   1,771,966   449,663 
    Research and development 153,191   75,450   759,427   153,828 
    Total operating expenses 5,329,512   2,567,613   18,501,010   8,282,371 
    Loss from operations (5,279,512)  (2,567,613)  (18,401,220)  (8,282,371)
    Other income (expenses):       
    Interest expense (18,055)  (34,507)  (62,508)  (34,507)
    Interest income 92   —   3,324   — 
    Gain on debt extinguishment 98,318   —   1,946,310   — 
    Change in fair value of warrant liabilities (632,969)  —   762,869   — 
    Other 9,043   19,789   (5,971)  (11,961)
    Other income (expenses), net (543,571)  (14,718)  2,644,024   (46,468)
    Loss before income taxes (5,823,083)  (2,582,331)  (15,757,196)  (8,328,839)
    Income taxes —   —   —   — 
    Net loss$(5,823,083) $(2,582,331) $(15,757,196) $(8,328,839)
    Net loss per common share- basic and diluted$(0.16) $(0.12) $(0.50) $(0.42)
    Weighted-average common shares - basic and diluted 35,539,043   22,409,790   31,623,082   19,928,947 
     

    The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.


    BRAND ENGAGEMENT NETWORK INC.
    UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)
     
     Preferred Stock Common Stock Additional
    Paid-in
    Capital
    		 Accumulated
    Deficit
    		 Total
    Stockholders’
    Equity
     Shares Par Value Shares Par Value  
    Balance at December 31, 2023— $— 23,270,404 $2,327 $30,993,846  $(13,301,720) $17,694,453 
    Stock issued to DHC shareholders in reverse recapitalization—  — 7,885,220  789  (10,722,277)  —   (10,721,488)
    Issuance of common stock pursuant to Reseller Agreement—  — 1,750,000  175  13,474,825   —   13,475,000 
    Sale of common stock—  — 645,917  65  6,324,935   —   6,325,000 
    Warrant exercises—  — 40,514  4  15,260   —   15,264 
    Stock-based compensation—  — —  —  698,705   —   698,705 
    Net loss—  — —  —  —   (6,884,409)  (6,884,409)
    Balance at March 31, 2024—  — 33,592,055  3,360  40,785,294   (20,186,129)  20,602,525 
    Stock issued in settlement of accounts payable and loans payable—  — 93,333  9  321,999   —   322,008 
    Sale of common stock—  — 877,500  198  1,993,552   —   1,993,750 
    Warrant exercises—  — 13,505  1  4,999   —   5,000 
    Stock-based compensation, including vested restricted shares—  — 381,915  42  768,497   —   768,539 
    Net loss—  — —  —  —   (3,049,704)  (3,049,704)
    Balance at June 30, 2024—  — 34,958,308  3,610  43,874,341   (23,235,833)  20,642,118 
    Issuance of common stock for Standby Equity Purchase Agreement commitment fee—  — 280,899  28  499,972   —   500,000 
    Stock issued in settlement of accrued expenses—  — 151,261  15  261,667   —   261,682 
    Sale of common stock—  — 602,500  131  1,756,056   —   1,756,187 
    Option and warrant exercises—  — 98,335  10  79,750   —   79,760 
    Stock-based compensation, including vested restricted shares—  — 35,461  —  334,913   —   334,913 
    Net loss—  — —  —  —   (5,823,083)  (5,823,083)
    Balance at September 30, 2024— $— 36,126,764 $3,794 $46,806,699  $(29,058,916) $17,751,577 


    BRAND ENGAGEMENT NETWORK INC.
    UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)
     
     Preferred Stock Common Stock Additional
    Paid-in
    Capital
    		 Accumulated
    Deficit
    		 Total
    Stockholders’
    Deficit
     Shares Par Value Shares Par Value 
    Balance at December 31, 2022— $— 17,057,085 $1,705 $1,528,642 $(1,570,454) $(40,107)
    Warrant exercises—  — 81,030  8  29,992  —   30,000 
    Stock issued in conversion of accounts payable and loans payable—  — 135,050  14  49,986  —   50,000 
    Stock-based compensation—  — —  —  2,442,701  —   2,442,701 
    Net loss—  — —  —  —  (2,637,956)  (2,637,956)
    Balance at March 31, 2023—  — 17,273,165  1,727  4,051,321  (4,208,410)  (155,362)
    Stock issued for DM Lab APA—  — 4,325,043  433  16,012,317  —   16,012,750 
    Options and warrant exercises—  — 56,552  10  20,928  —   20,938 
    Stock issued in conversion of convertible notes—  — 378,140  38  1,399,962  —   1,400,000 
    Stock issued in settlement of accounts payable and loans payable—  — 103,439  10  382,953  —   382,963 
    Stock-based compensation—  — —  —  1,841,767  —   1,841,767 
    Net loss—  — —  —  —  (3,108,552)  (3,108,552)
    Balance at June 30, 2023—  — 22,136,339  2,218  23,709,248  (7,316,962)  16,394,504 
    Options and warrant exercises—  — 64,993  3  9,997  —   10,000 
    Vesting of early exercised options—  — —  —  1,563  —   1,563 
    Stock issued in conversion of convertible notes—  — 432,160  43  1,599,957  —   1,600,000 
    Sale of common stock, net of issuance costs—  — 123,333  12  949,988  —   950,000 
    Stock-based compensation—  — —  —  464,075  —   464,075 
    Net loss—  — —  —  —  (2,582,331)  (2,582,331)
    Balance at September 30, 2023— $— 22,756,825 $2,276 $26,734,828 $(9,899,293) $16,837,811 
     

    The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.


    BRAND ENGAGEMENT NETWORK INC.
    UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
     
     Nine Months Ended
    September 30,
      2024   2023 
    Cash flows from operating activities:   
    Net loss$(15,757,196) $(8,328,839)
    Adjustments to reconcile net loss to net cash used in operating activities:   
    Depreciation and amortization expense 1,771,966   449,663 
    Allowance for uncollected receivables 30,000   — 
    Write off of deferred financing fees 1,427,729   — 
    Change in fair value of warrant liabilities (762,869)  — 
    Gain on debt extinguishment (1,946,310)  — 
    SEPA financing costs 525,000   — 
    Stock based compensation, including the issuance of restricted shares 1,581,744   4,727,799 
    Changes in operating assets and liabilities:   
    Prepaid expense and other current assets (856,986)  (103,917)
    Accounts receivable (50,888)  500 
    Accounts payable 5,393,334   62,373 
    Accrued expenses (3,019,367)  431,194 
    Other assets —   8,850 
    Deferred revenue (2,290)  — 
    Net cash used in operating activities (11,666,133)  (2,752,377)
    Cash flows from investing activities:   
    Purchase of property and equipment (53,023)  (28,465)
    Purchase of patents —   (379,864)
    Capitalized internal-use software costs (162,940)  (310,944)
    Asset acquisition (Note D) —   (257,113)
    Net cash used in investing activities (215,963)  (976,386)
    Cash flows from financing activities:   
    Cash and cash equivalents acquired in connection with the reverse recapitalization 858,292   — 
    Proceeds from the sale of common stock 10,274,937   1,000,000 
    Proceeds from convertible notes —   3,075,000 
    Proceeds from related party note —   620,000 
    Proceeds received from option and warrant exercises 100,024   22,500 
    Payment of financing costs (883,292)  (107,310)
    Payment of related party note (80,000)  — 
    Advances to related parties —   (39,065)
    Proceeds received from related party advance repayments —   138,110 
    Net cash provided by financing activities 10,269,961   4,709,235 
    Net (decrease) increase in cash and cash equivalents (1,612,135)  980,472 
    Cash and cash equivalents at the beginning of the period 1,685,013   2,010 
    Cash and cash equivalents at the end of the period$72,878  $982,482 
     

    The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.


    BRAND ENGAGEMENT NETWORK INC.
    UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
     
     Nine Months Ended
    September 30,
     2024 2023
    Supplemental Cash Flow Information   
    Cash paid for interest$— $—
    Cash paid for income taxes$— $—
    Supplemental Non-Cash Information   
    Capitalized internal-use software costs in accrued expenses$— $46,963
    Issuance of common stock pursuant to Reseller Agreement$13,475,000 $—
    Issuance of common stock for Standby Equity Purchase Agreement commitment fee$500,000 $—
    Stock-based compensation capitalized as part of capitalized software costs$220,413 $20,745
    Settlement of liabilities into common shares$583,690 $432,963
    Settlement of accounts payable into convertible note$1,900,000 $—
    Conversion of convertible notes into common shares$— $3,000,000
    Warrants exercise through settlement of accounts payable$— $40,000
    Financing costs in accounts payable and accrued expenses$200,000 $687,609
    Issuance of common stock in connection with asset acquisition$— $16,012,750
     

    The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.


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