Overview
We have developed a financial technology product and that uses advanced
distributed ledger technology for improved security, speed, and reliability. We
recently released our CORO product and commenced its commercialization. CORO is
a global money transmitter that allows customers to send, receive, and exchange
currencies faster, cheaper and more securely, initially consisting of the
ability to send, receive and exchange U.S. dollars and gold. Our mission through
CORO is to democratize access to gold as sound money. CORO makes it simple,
convenient and affordable to use gold as money. The CORO mobile app was
completed and released in select U.S. markets in August 2020. Following the
initial commercial release, CORO has expanded into new markets and is now
licensed, approved and operating in 19 states plus the District of Columbia.
CORO intends to expand the release of the app throughout the U.S. in early 2021.
The Company will also pursue money transmission licenses in foreign countries
such as Mexico and Canada.
We believe CORO is the world's first global payment application that includes
gold, the oldest and most trusted money. CORO technology facilitates money
transmission and exchange with faster speeds, better security, and lower costs
than existing options in the marketplace. An important component of the CORO
payment system is our Financial Crime Risk Management (FCRM) solution. We have
developed our FCRM platform, as an integrated AML/KYC onboarding and transaction
monitoring solution that provides an affordable and fully integrated compliance
solution for CORO's compliance department. The solution meets the rigorous
demands of government regulators, while supporting our customers. The FCRM
technology has been completed and is incorporated within the CORO mobile payment
system.
References in this report to "we," "us," the "Company" and "our" refer to Coro
Global Inc. together with its wholly-owned subsidiary.
Results of Operations for the three months ended September 30, 2020 and 2019
Revenues
In August 2020 the Company successfully launched the Coro mobile payment
application on a commercial basis. The Coro app is available for users to
download in the Apple Store and Google Play. The Company generated nominal
transaction revenues of $418 during the three months ended September 30, 2020.
Selling, General and Administrative Expenses
Selling, general and administrative expenses for the three months ended
September 30, 2020 were $988,972, an increase of $359,818 or approximately 57%
compared to selling, general and administrative expenses of $629,154 for the
three months ended September 30, 2019. Stock compensation due to consulting fees
decreased by $38,628 to $256,824 for the three months ended September 30, 2020
from stock compensation expense of $295,452 for the three months ended September
30, 2019, in connection with the expansion of our operations. During the three
months ended September 30, 2020, the Company incurred advertising costs of
$69,471 compared to $0 for the three month ended September 30, 2019, due to the
Company preparing to launch its CORO product. The remaining operating costs
remained constant.
Development Expense
Development expenses for the three months ended September 30, 2020 were $422,523
compared to $184,021 for the three months ended September 30, 2019. We incurred
significantly higher development expenses, including fees paid to vendors, for
our CORO product during the three months ended September 30, 2020 compared to
the three months ended September 30, 2019 as we prepared to launch our CORO
product.
Interest Expense
Interest expense on debentures for the three months ended September 30, 2020 and
2019, was $0 and $2,236, respectively. During the three months ended September
30, 2020 the Company repaid its remaining loans.
Other Expense
Net Loss
For the reasons stated above, our net loss for the three months ended September
30, 2020 was ($1,411,077) or ($0.06) per share, an increase of $(595,666) or
73%, compared to net loss of ($815,411), or ($0.04) per share, for the three
months ended September 30, 2019.
15
Results of Operations for the nine months ended September 30, 2020 and 2019
Revenues
In August 2020 the Company successfully launched the Coro mobile payment
application on a commercial basis. The Coro app is available for users to
download in the Apple Store and Google Play. The Company generated nominal
transaction revenues of $418 during the nine months ended September 30, 2020.
Selling, General and Administrative Expenses
Selling, general and administrative expenses for the nine months ended September
30, 2020 were $3,052,827, a decrease of $106,364 or approximately 17% compared
to selling, general and administrative expenses of $3,159,191 for the nine
months ended September 30, 2019. Stock compensation due to consulting fees
increased by $1,021,880 to $1,513,432 for the nine months ended September 30,
2020 from stock compensation expense of $491,552 for the nine months ended
September 30, 2019, in connection with the expansion of our operations. During
the nine months ended September 30, 2020 the Company incurred advertising costs
of $194,852 compared to $0 for the nine month ended September 30, 2019, as the
Company prepared to launch its CORO product. The decrease in expense were mainly
attributable to modifications of stock based compensation expenses of $1,957,313
incurred during the nine months ended September 30, 2019 which was partially
offset by higher legal, professional and consulting fees during the nine months
ended September 30, 2020.
Development Expense
Development expenses for the nine months ended September 30, 2020 were $911,029
compared to $890,695 for the nine months ended September 30, 2019. We incurred
significantly higher development expenses, including fees paid to vendors, for
our CORO product during the nine months ended September 30, 2019 compared to the
nine months ended September 30, 2020. The reduction in expense was due to the
Company using in-house developers rather than a third party contractor.
Interest Expense
Interest expense on debentures for the nine months ended September 30, 2020 and
2019, was $165,000 and $17,211, respectively. Interest expense during nine
months ended September 30, 2020 included the expense for issuing 33,000 shares
of common stock valued at $165,000 for the extension of a loan to a related
party.
Other Expense
Net Loss
For the reasons stated above, our net loss for the nine months ended September
30, 2020 was ($4,128,438) or ($0.17) per share, an increase of $61,341 or 2%,
compared to net loss of ($4,067,097), or ($0.18) per share, for the nine months
ended September 30, 2019.
Liquidity and Capital Resources
As of September 30, 2020, we had cash of $1,483,925, compared to cash of
$470,800 as of December 31, 2019. Net cash used in operating activities for the
nine months ended September 30, 2020 was $2,389,780. Our current liabilities as
of September 30, 2020 of $494,134 consisted of: $407,415 for accounts payable
and due to customers of $86,719.
During the nine months ended September 30, 2020 we entered into and closed
subscription agreements with accredited investors pursuant to which the Company
sold to the investors an aggregate of 717,000 shares of common stock, for a
purchase price of $5.00 per share, and aggregate gross proceeds of $3,585,000.
We repaid $180,382 of outstanding principal of a note payable from a
then-related party. The balance at September 30, 2020 was $0.
Net cash used in operating activities for the nine months ended September 30,
2019 was $1,719,434.
During the nine months ended September 30, 2019 the Company entered into and
closed subscription agreements with accredited investors pursuant to which the
Company sold to the investors an aggregate of 320,000 shares of common stock,
for a purchase price of $5.00 per share, and aggregate gross proceeds of
$1,600,000. A related party advanced the Company $3,000 and was repaid $3,000.
In February 2019, the Company issued a promissory note to its then-largest
stockholder in the principal amount of $110,000 with an original issue discount
of $10,000. The note has a 0% interest rate and had an original maturity date of
March 31, 2019, which has been extended to December 31, 2019. Following the
maturity date, the note bears a 9% annual interest rate until paid in full. In
April 2019, the Company repaid $50,000 of a convertible loan to a related party
and exchanged the remaining $50,000 into 10,000 shares of common stock valued at
$50,000.
16
We anticipate that we will need to raise additional capital to execute our
business plan, which may not be available on acceptable terms, or at all. If we
raise funds through the sale of common stock or securities convertible into
common stock, it may result in substantial dilution to our then-existing
stockholders.
Off Balance Sheet Arrangements
We currently have no off-balance sheet arrangements that have or are reasonably
likely to have a current or future material effect on our financial condition,
changes in financial condition, revenues or expenses, results of operations,
liquidity, capital expenditures or capital resources.
Critical Accounting Policies and Estimates
Revenue Recognition
Effective January 1, 2018, we recognize revenue in accordance with Accounting
Standards Codification 2014-09, Revenue from Contracts with Customers (Topic
606), which supersedes the revenue recognition requirements in Topic 605,
Revenue Recognition, and most industry-specific revenue recognition guidance
throughout the Industry Topics of the Accounting Standards Codification. The
updated guidance states that an entity should recognize revenue to depict the
transfer of promised goods or services to customers in an amount that reflects
the consideration to which the entity expects to be entitled in exchange for
those goods or services. The guidance also provides for additional disclosures
with respect to revenues and cash flows arising from contracts with customers.
The standard was effective for the first interim period within annual reporting
periods beginning after December 15, 2017, and we adopted the standard using the
modified retrospective approach effective January 1, 2018. The adoption of this
guidance did not have a material impact on our financial statements.
Stock-Based Compensation
We account for all compensation related to stock; options or warrants using a
fair value-based method whereby compensation cost is measured at the grant date
based on the value of the award and is recognized over the service period, which
is usually the vesting period. We use the Black-Scholes pricing model to
calculate the fair value of options and warrants issued to both employees and
non-employees. Stock issued for compensation is valued using the market price of
the stock on the date of the related agreement.
Impairment of long-lived assets
We review long-lived assets for impairment whenever events or changes in
circumstances indicate that the asset's carrying amount may not be recoverable.
We conduct our long-lived asset impairment analyses in accordance with ASC
360-10-15, "Impairment or Disposal of Long-Lived Assets." ASC 360-10-15 requires
the Company to group assets and liabilities at the lowest level for which
identifiable cash flows are largely independent of the cash flows of other
assets and liabilities and evaluate the asset group against the sum of the
undiscounted future cash flows. If the undiscounted cash flows do not indicate
the carrying amount of the asset is recoverable, an impairment charge is
measured as the amount by which the carrying amount of the asset group exceeds
its fair value based on discounted cash flow analysis or appraisals.
Recently Issued Accounting Pronouncements
There were various updates recently issued, most of which represented technical
corrections to the accounting literature or application to specific industries
and are not expected to have a material impact on our financial position,
results of operations or cash flows.
In February 2016, the FASB issued ASU 2016-02, Leases, which amended current
lease accounting to require lessees to recognize (i) a lease liability, which is
a lessee's obligation to make lease payments arising from a lease, measured on a
discounted basis, and (ii) a right-of-use asset, which is an asset that
represents the lessee's right to use, or control the use of, a specified asset
for the lease term. ASU 2016-02 does not significantly change lease accounting
requirements applicable to lessors; however, certain changes were made to align,
where necessary, lessor accounting with the lessee accounting model. This
standard was effective for fiscal years beginning after December 15, 2018,
including interim periods within those fiscal years. The adoption of this ASU
did not have a material impact on our balance sheet.
Management does not believe that any other recently issued but not yet effective
accounting pronouncements, if adopted, would have a material effect on the
accompanying financial statements.
17© Edgar Online, source Glimpses
CORO GLOBAL INC. 