Two Hands Corp Releases Q2 2024 Financial Report

Two Hands Corp, a company specializing in wholesale food distribution through its Cuore Food Services branch, has released its Form 10-Q report for the second quarter of 2024. The report highlights the company's financial performance and operational shifts following the sale of its gocart.city online delivery segment.

Financial Highlights

• Sales: $226,289 for the three months ended June 30, 2024, and $389,766 for the six months ended June 30, 2024. The increase in sales is attributed to improved management of purchases and inventory.
• Gross Profit: $45,010 for the three months ended June 30, 2024, and $59,999 for the six months ended June 30, 2024. The gross profit percentage increased due to better management of purchases and inventory.
• Loss from Operations: $(266,489) for the three months ended June 30, 2024, and $(556,690) for the six months ended June 30, 2024. The loss from operations reflects the company's ongoing efforts to manage costs.
• Net Loss: $(495,041) for the three months ended June 30, 2024, and $(1,277,187) for the six months ended June 30, 2024. The net loss is primarily due to costs associated with professional fees, compensation to the CEO, interest expense, and loss on settlement of non-redeemable convertible notes.
• Net Loss Per Common Share - Basic and Diluted: $(0.00) for the three months ended June 30, 2024. The net loss per share reflects the company's financial performance during the period.

Business Highlights

Revenue Segments

The company reported sales from its Grocery Originals and Cuore Food Service branches, focusing on retail and wholesale distribution. The gocart.city online delivery segment was sold on May 1, 2023, and thus did not contribute to revenue in the current period. The remaining operations are centered around Cuore Food Services, which continues to distribute dry goods and produce to other businesses, such as restaurants and hotels, using inventory from the company's warehouse and additional ad hoc acquisitions. This segment saw an increase in sales compared to the previous year, indicating a successful focus on wholesale distribution channels after the sale of gocart.city and Grocery Originals branches.

Geographical Performance

The company's operations are primarily based in Canada, with a focus on Southern Ontario. The sale of the gocart.city platform has shifted the company's focus entirely to Cuore Food Services, which continues to serve the Canadian market. This strategic shift is aimed at strengthening the company's position in the wholesale food distribution sector within Canada. The company plans to expand its reach to more customers across Canada while enhancing its product line with a focus on Italian staples. This indicates a targeted approach to capitalize on regional demand for specific product categories.

Sales Units

While specific sales unit data is not provided, the company has indicated an increase in sales from its Grocery Originals and Cuore Food Service branches compared to the previous year. This suggests an improvement in operational performance within these segments, likely driven by enhanced inventory management practices following the divestiture of gocart.city.

Future Outlook

The company plans to continue expanding its reach across Canada while enhancing its product line with a focus on Italian staples such as pasta, oils, olives, and canned tomatoes. Additionally, there are plans to expand storage capacity, warehouse staff, delivery trucks, and delivery areas as part of operational improvements aimed at supporting growth in Cuore Food Services. These initiatives reflect a strategic focus on strengthening the company's position in the wholesale food distribution market within Canada.

Operational Challenges & Strategies

The company is focusing on improving cash flows from operations by reducing customer incentives, diversifying suppliers, accelerating accounts receivable collections, reducing expenses, managing accounts payable balances, and compensating officers with stock instead of cash where possible. These strategies are aimed at addressing liquidity challenges while supporting ongoing business operations.

Management's Plan of Operation

Management is focused exclusively on expanding Cuore Food Services as part of its strategic shift away from direct-to-consumer grocery delivery following the sale of gocart.city. This involves leveraging existing warehouse infrastructure for bulk deliveries to food service businesses such as restaurants, hotels, event planning/hosting businesses across Canada.

Operational Improvements & Initiatives

The company aims to enhance operational efficiency by expanding storage capacity, increasing warehouse staff numbers, adding more delivery trucks, expanding delivery areas geographically within Canada—all intended to support growth in Cuore Food Services' wholesale distribution activities post-divestiture of gocart.city platform earlier this year (May 2023).

Customer Engagement & Marketing Strategies

Prior efforts included engaging local renowned chef Grace DiFede for curating meal kits/bundles sold via now-divested gocart.city platform; social media engagement through platforms like Facebook/Twitter/Instagram/Google; partnerships with SRAX Inc./Adfuel Media Inc.; these initiatives were part of broader strategy aimed at boosting customer engagement prior divestiture decision made last year (2023).

SEC Filing: Two Hands Corp Releases Q2 2024 Financial Report [ OTC:TWOH ] - 10-Q - Aug. 12, 2024