Declaring it has “no clear path to revenue in the short run,” software firm Leonovus says it needs an “immediate” source of new funding in order to keep afloat after generating just $5,000 in sales in the first half of 2022.
In its latest financial reports filed earlier this week, the Ottawa company said it brought in revenues of $5,000 in the three-month period ending June 30, compared with zero sales a year earlier.
That comes after the firm failed to generate any income in the first quarter of 2022 despite saying it had high hopes for its software, branded Torozo.
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“While the company is excited about its long-run value, Torozo will not generate enough revenues soon to sustain the company,” Leonovus said in a management discussion and analysis report filed on Monday.
“The company needs an immediate funding solution other than revenues to sustain itself,” it added.
Leonovus posted a net loss of $575,000 in the second quarter, compared with a loss of $784,000 the previous year.
The latest financial results come six months after Leonovus said it received a standing offer from the federal government to buy its technology – a move it hoped would resuscitate its flagging fortunes.
CEO Michael Gaffney said in a news release in late April that two federal departments, Justice and Shared Services, finished testing the product earlier this spring. He said the company has moved on to the “next evaluation phase” with the feds, adding the product was released to private-sector customers last week with “additional features needed by the business and enterprise markets.”
Leonovus’s solution distributes and encrypts clients’ stored data across numerous cloud servers rather than a single on-premise location. The company is now selling the platform on a monthly subscription basis.
The firm said it expects selling and marketing expenses to “continue to increase from last year’s expenses throughout 2022,” adding that spending may fluctuate “based on sales opportunities.”