PERPETUAL INDUSTRIES INC.

CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

FOR THE SIX MONTHS ENDED

JUNE 30, 2022

1

Table of Contents

Page

PART I

Item 1

Unaudited Consolidated Financial Statements

3

Item 2

Management's Discussion and Analysis of Financial Condition and Results of Operations

27

Item 3

Quantitative and Qualitative Disclosures about Market Risk

37

Item 4

Controls and Procedures

37

PART II

Item 5

Other Information

37

Item 6

Exhibits

38

2

ITEM 1. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Perpetual Industries, Inc. and a Subsidiary

Financial Statements

Condensed Consolidated Balance Sheets at June 30, 2022 (Unaudited) December 31, 2021

F-1

Condensed Consolidated Statements of Operations (Unaudited) for the six months ended June 30, 2022 and 2021

F-2

Condensed Consolidated Statements of Stockholders' Deficit (Unaudited) for the three and six months ended June 30, 2022

F-3

and 2021

Condensed Consolidated Statements of Cash Flows (Unaudited) for the six months ended June 30, 2022 and 2021

F-4

Notes to Unaudited Condensed Consolidated Financial Statements

F-5

3

PERPETUAL INDUSTRIES, INC. AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

June 30,

December 31,

2022

2021

ASSETS

(Unaudited)

(Audited)

Current assets

Cash

$

183,847

$

1,048,547

Accounts receivable

58,235

96,020

Inventory

18,030

13,660

Deposits and prepaids

70,521

56,202

Total current assets

330,633

1,214,429

Fixed assets, net of accumulated depreciation

1,214,510

645,850

Intangible assets - net

5,141,219

901,905

Indefinite life asset

44,108

59,715

Right of use asset

780,421

880,019

Goodwill

3,243,049

7,813,049

Total assets

$

10,753,940

$

11,514,967

LIABILITIES

Current liabilities:

Accounts payable and accrued expenses

$

918,736

$

864,913

Accounts payable and accrued expenses - related party

280,252

256,041

Notes payable - related party

700,000

700,000

Lease liability

208,307

202,153

Economic Injury Disaster Loan Program (EIDL) loan, current

maturities

3,036

3,036

Total current liabilities

2,110,331

2,026,143

Lease liability, long term

572,187

677,906

Payroll protection program loan

124,772

124,772

Economic Injury Disaster Loan Program (EIDL) loan, long-term

148,932

145,964

Total liabilities

2,956,222

2,974,785

Commitments and contingencies (Note 19)

STOCKHOLDERS' EQUITY

Preferred stock, $0.0001 par value, 100,000,000 shares authorized;

Series A: 160 shares authorized; 2 and 0 shares issued and outstanding at

June 30, 2022 and December 31, 2021, respectively

-

-

Series B: 2,000,000 shares authorized; 2,000,000 and 0 shares issued and

outstanding at June 30, 2022 and December 31, 2021, respectively

200

200

Common stock, $0.001 par value; 500,000,000 shares authorized;

81,341,500 and 78,137,800 issued and outstanding at June 30, 2022 and

December 31, 2021 respectively

81,341

78,138

Common stock to be issued

212,070

217,070

Unearned compensation

(421,151)

-

Additional paid in capital

21,453,921

20,437,326

Other accumulated comprehensive loss

(11,086)

(10,078)

Accumulated deficit

(13,517,577)

(12,182,474)

Total stockholders' equity

7,797,718

8,540,182

Total liabilities and stockholders' equity

$

10,753,940

$

11,514,967

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

F-1

4

PERPETUAL INDUSTRIES, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(UNAUDITED)

For the Three Months Ended

For the Six Months Ended

June 30,

June 30,

June 30,

June 30,

2022

2021

2022

2021

Revenues

Service revenues

$

707,114

$

527,745

$

2,192,509

$

1,249,875

Product sales

25,000

1,408,305

28,500

1,408,305

Cryptocurrency mining revenue

40,162

9,897

86,742

20,181

Total revenues

772,276

1,945,947

2,307,751

2,678,361

Cost of sales

260,228

1,374,131

1,025,965

1,575,539

Gross profit

512,048

571,816

1,281,786

1,102,822

Operating expenses

General and administrative expenses

653,778

239,921

1,314,554

395,658

Depreciation and amortization

135,668

33,643

676,887

40,882

Outsource consulting fees

131,470

489,256

258,096

760,543

General and administrative expenses, related party

80,665

10,023

178,550

39,320

Management service, related party

47,974

63,323

94,863

114,586

Research and development

1,562

20,931

2,873

33,566

Stock-based compensation

-

301,614

-

327,086

Total operating expenses

1,051,117

1,158,711

2,525,823

1,711,641

Net operating loss

(539,069)

(586,895)

(1,244,037)

(608,819)

Other income (expense)

Interest expense

(22,307)

(33,404)

(41,596)

(54,265)

Interest expense, related party

2,275

-

2,275

-

Interest income - related party

-

2,992

-

2,992

Other income

1,432

359

3,310

668

Loss on settlement of debt

-

(30,962)

-

(30,962)

Loss on impairment of digital currencies

(34,841)

-

(48,827)

-

Loss on sale of digital currencies

(2,634)

-

(2,634)

-

Loss on sale of disposal of assets

(3,350)

-

(3,350)

-

Gain on settlement of debt

-

15,000

-

15,000

Foreign currency transaction adjustments

(206)

(231)

(244)

(2,889)

Total other income (expense)

(59,631)

(46,246)

(91,066)

(69,456)

Net loss

(598,700)

(633,141)

(1,335,103)

(678,275)

Unrealized translation gain (loss)

(331)

(149)

(1,008)

1,597

Other comprehensive loss

$

(599,031)

$

(633,290)

$

(1,336,111)

$

(676,678)

Basic and loss per share

$

(0.01)

$

(0.01)

$

(0.02)

$

(0.01)

Basis and diluted weighted average common shares

outstanding

78,222,744

70,916,568

78,222,744

70,916,568

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

F-2

5

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Perpetual Industries Inc. published this content on 15 August 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 15 August 2022 21:03:20 UTC.