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Quest Patent Research Corporation announces $3.6 million net income for 2023

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Quest Patent Research (QPRC) reports a significant turnaround in financial performance for the year ended December 31, 2023, with a net income of $3.6 million and revenues of $13.2 million, compared to a loss of $0.8 million and revenues of $0.5 million in 2022.
Positive
  • QPRC achieved a notable net income of $3.6 million for the year 2023.
  • The company's revenues surged to $13.2 million in 2023 from $0.5 million in 2022.
  • Revenue growth was attributed to the settlement of patent infringement litigation.
  • QPRC demonstrated a remarkable financial turnaround compared to the previous year.
Negative
  • None.

RYE, N.Y., March 28, 2024 /PRNewswire/ -- Quest Patent Research Corporation (OTCQB: QPRC) (the "Company" or "Quest"), announced today the results of its operations for the year ended December 31, 2023. For the year ended December 31, 2023, the Company generated net income of approximately $3.6 million, or $0.68 per share (basic and diluted), on revenues of approximately $13.2 million as compared to a loss of approximately $0.8 million on revenues of $0.5 million for the year ended December 31, 2022. Revenue from both years was generated from the settlement of patent infringement litigation. The Company's balance sheet, statement of operations and statements of cash flows are included as exhibits to this press release.

About Quest Patent Research Corporation

Quest is an intellectual property asset management company. Its principal operations include the acquisition, licensing and enforcement of intellectual property rights that are either owned or controlled by the Company. Quest currently owns, controls or manages 22 intellectual property portfolios of which it is currently seeking or may seek monetization with respect to twelve portfolios, which principally consist of patent rights. Quest's business is described in its annual report on Form 10-K for the year ended December 31, 2023, which was filed with the Securities and Exchange Commission on March 28, 2024. Quest's website is www.qprc.com. Information contained on or derived from Quest's website, or any other website or any social media does not constitute a part of this press release.

Cautionary Note Regarding Forward-Looking Statements

This press release and the earnings call contain "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, both as amended by the Private Securities Litigation Reform Act of 1995. The words "expect," "believe," "estimate," "intend," "plan," "anticipate," "may," "should," "strategy," "future," "will," "project," "potential" and similar expressions indicate forward-looking statements. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. These risks and uncertainties include, but are not limited to the risk that the Quest may not generate any significant revenue or operate profitably in the future and the other risks described in "Forward Looking Statements," "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Quest's Form 10-K for the year ended December 31, 2023, which was filed with the Securities and Exchange Commission on March 28, 2024.

QUEST PATENT RESEARCH CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS



December 31,



2023


2022






ASSETS





Current assets





Cash and cash equivalents


$                     563,484


$                       90,601

Accounts receivable, net of allowance for credit losses of $0 and $0, respectively


3,008,250


Other current assets


28,121


5,321

Total current assets


3,599,855


95,922






Patents, net of accumulated amortization of $2,412,397 and $1,625,846, respectively


3,674,603


1,131,154

Total assets


$                 7,274,458


$                  1,227,076






LIABILITIES AND STOCKHOLDERS' DEFICIT





Current liabilities





Accounts payable and accrued liabilities


296,536


148,533

Loans payable


138,000


138,000

Funding liability


7,325,502


5,453,204

Loan payable - related party


2,796,500


2,796,500

Warrant liability


281,809


145,428

Accrued interest


1,096,985


904,573

Total current liabilities


11,935,332


9,586,238






Non-current liabilities





Loan payable – SBA


150,000


150,000

Purchase price of patents


53,665


53,665

Total liabilities


12,138,997


9,789,903






Commitments and contingencies (Note 10)










Stockholders' deficit:





Preferred stock, par value $0.00003 per share - authorized
10,000,000 shares - no shares issued and outstanding



Common stock, par value $0.00003 per share; authorized
30,000,000 at December 31, 2023 and 2022; 5,331,973 shares
issued and outstanding at December 31, 2023 and December 31, 2022


160


160

Additional paid-in capital


17,674,985


17,626,279

Accumulated deficit


(22,539,912)


(26,189,494)

Total Quest Patent Research Corporation stockholders' deficit


(4,864,767)


(8,563,055)

Non-controlling interest in subsidiary


228


228

Total stockholders' deficit


(4,864,539)


(8,562,827)

Total liabilities and stockholders' deficit


$                 7,274,458


$                  1,227,076

 

QUEST PATENT RESEARCH CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS



Year Ended December 31,


2023


2022

Revenues




Patent licensing fees

$          13,152,500


$                451,194

Cost of revenue




Litigation and licensing expenses

5,534,596


303,671

Gross margin

7,617,904


147,523





Operating expenses




Selling, general and administrative expenses

2,740,554


1,979,718

Total operating expenses

2,740,554


1,979,718





Income (loss) from operations

4,877,350


(1,832,195)





Other income (expense)




Change in fair market value of warrant liability

(136,381)


1,490,759

Interest expense

(1,061,387)


(413,333)

Total other income (expense)

(1,197,768)


1,077,426





Income (loss) before income tax

3,679,582


(754,769)





Income tax benefit (expense)

(30,000)


1,253





Net income (loss)

$             3,649,582


$              (753,516)





Income (loss) per share - basic and diluted

$                       0.68


$                     (0.14)





Weighted average shares outstanding - basic and diluted

5,331,973


5,331,973

 

QUEST PATENT RESEARCH CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS



Year Ended December 31,


2023


2022

Cash flows from operating activities:




Net income (loss)

$                     3,649,582


$                       (753,516)

Adjustments to reconcile net income (loss) to cash provided by
(used in) operating activities:




Change in fair market value of warrant liability

136,381


(1,490,759)

Stock-based compensation

48,706


117,412

Amortization of intangible assets

786,552


910,326





Change in operating assets and liabilities:




Accounts receivable

(3,008,250)


Accrued interest

192,415


412,602

Other current assets

(22,800)


6,984

Accounts payable and accrued liabilities

147,999


19,108

Patents loan payable


(136,335)

Net cash provided by (used in) operating activities

1,930,585


(914,178)





Cash flows from investing activities:




Purchase of intangible assets

(3,330,000)


(1,502,000)

Net cash used in investing activities

(3,330,000)


(1,502,000)





Cash flows from financing activities:




Payments on loans - related party


(8,500)

Proceeds from funding liability

6,000,000


2,303,000

Payment of funding liability

(4,127,702)


(52,561)

Net cash provided by financing activities

1,872,298


2,241,939





Net increase (decrease) in cash and cash equivalents

472,883


(174,239)





Cash and cash equivalents at beginning of period

90,601


264,840





Cash and cash equivalents at end of period

$                         563,484


$                           90,601





Non-cash investing and financing activities:




Interest added to principal

$                             5,625


$                             4,895





Supplemental disclosure of cash flow information:




Cash paid during the period for:




Income taxes

$                           30,000


$                           (1,253)

Interest

$                         969,930


$                                   —

 

Cision View original content:https://www.prnewswire.com/news-releases/quest-patent-research-corporation-announces-3-6-million-net-income-for-2023--302102057.html

SOURCE Quest Patent Research Corporation

FAQ

What was Quest Patent Research 's net income for the year ended December 31, 2023?

Quest Patent Research reported a net income of $3.6 million for the year ended December 31, 2023.

What were the revenues for Quest Patent Research in 2023?

Quest Patent Research generated revenues of $13.2 million in 2023.

What caused the revenue growth for Quest Patent Research in 2023?

The revenue growth for Quest Patent Research in 2023 was attributed to the settlement of patent infringement litigation.

How did Quest Patent Research 's financial performance in 2023 compare to 2022?

Quest Patent Research demonstrated a significant financial turnaround in 2023 compared to 2022, with a net income of $3.6 million and revenues of $13.2 million, as opposed to a loss of $0.8 million and revenues of $0.5 million in 2022.

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