OTC:WDSP
World Scan Project, Inc.
A volatile OTC stock that recently rebounded to $25.2M in revenue but continues to post net losses despite strong cash flow financing activities.
Key Metrics
Investment Thesis
Bull Case
The stock presents a turnaround narrative with revenue jumping from $0.3M to $25.2M and gross profits reaching $7.6M, supported by a robust balance sheet where current assets significantly exceed current liabilities.
Bear Case
Investors should avoid the security due to consecutive years of negative net income, a massive working capital change deficit of -$17.0M, and the ongoing erosion of shareholder equity exacerbated by foreign exchange losses.
About World Scan Project, Inc.
World Scan Project, Inc. (WDSP) is an OTC-traded entity reporting a significant revenue resurgence to $25.2M in 2024 after a minimal 2023 performance, while maintaining a healthy current ratio above 2.0.
Analysis
Management Discussion
Management successfully secured $13.7M in financing cash flow which partially offset a massive $16.9M operating burn, yet the company still faces a net change in cash of -$4.1M driven by heavy inventory builds and discontinued operations losses.
Industry Overview
The company operates in a niche OTC market sector characterized by high volatility where revenue can fluctuate wildly from negligible levels to multi-million dollar turns depending on discontinued or continuing operations performance.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Revenue | $14.5M | $288.1K | $25.2M |
| Cost of Revenue | $11.3M | $135.3K | $17.6M |
| Gross Profit | $18.1M | $30.9M | $7.6M |
| Operating Expenses | $4.3M | $36.3M | $7.1M |
| Operating Income | $13.8M | $-5.5M | $492.1K |
| R&D | — | $18.7M | — |
| G&A | $4.3M | $17.6M | $6.3M |
| Other OpEx | $-312.0K | $-293.4K | $512.6K |
| Non-Operating Income | $4.9M | $-2.1M | $2.5K |
| Pre-Tax Income | $18.7M | $-7.6M | $494.6K |
| Income Tax | $4.9M | $-2.1M | $2.5K |
| Continuing Ops | $13.8M | $-5.5M | $492.1K |
| Discontinued Ops | $-4.9M | $2.1M | $-1.3M |
| Net Income | $8.9M | $-3.4M | $-768.4K |
| Minority Interest | $0 | $0 | $0 |
| Net to Common | $8.9M | $-3.4M | $-768.4K |
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Current Assets | $24.1M | $11.3M | $24.4M |
| Cash & Equivalents | $5.8M | $5.7M | $1.6M |
| Inventory | $403 | $358.6K | $17.0M |
| Other Current Assets | $18.2M | $5.2M | $5.7M |
| Long-Term Assets | $1.4M | $2.7M | $3.0M |
| Total Assets | $25.5M | $14.0M | $27.4M |
| Current Liabilities | $14.4M | $4.7M | $10.4M |
| Long-Term Liabilities | $520.0K | $626.2K | $466.6K |
| LT Operating Leases | $520.0K | $626.2K | $466.6K |
| Other LT Liab | $0 | $0 | $0 |
| Total Liabilities | $14.9M | $5.3M | $10.8M |
| Shareholders' Equity | $10.6M | $8.7M | $16.6M |
| Paid-In Capital | $324.0K | $2.1M | $10.6M |
| Retained Earnings | $12.6M | $9.1M | $8.4M |
| Total L&E | $25.5M | $14.0M | $27.4M |
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Net Income (CFO) | $8.9M | $-3.4M | $-768.4K |
| Non-Cash Adjustments | $8.0M | $-3.7M | $877.5K |
| Working Capital Changes | $-12.3M | $6.9M | $-17.0M |
| Cash from Operations | $4.6M | $-170.5K | $-16.9M |
| Cash from Investing | $-227.2K | $-1.6M | $-126.4K |
| Cash from Financing | $0 | $1.9M | $13.7M |
| FX Effect | $-1.1M | $-201.7K | $-793.9K |
| Net Change in Cash | $3.3M | $-137.2K | $-4.1M |
| Beginning Cash | $2.6M | $5.8M | $5.7M |
| Ending Cash | $5.8M | $5.7M | $1.6M |
Frequently Asked Questions
How does World Scan Project, Inc. make money?
The company's financials suggest operations centered around inventory management with $17.0M in stock, general and administrative functions consuming $6.3M of expenses, and a substantial shift from discontinued operations contributing a $1.3M loss.
What are the main risks for WDSP?
Persistent net losses of $768,431 for the latest year with a retained earnings deficit of $8.4M, extreme revenue volatility dropping to $0.3M in 2023 before recovery, and significant foreign exchange effects reducing cash by nearly $800k.
What is WDSP's competitive advantage?
Strong liquidity position with $24.4M in current assets against $10.4M in liabilities, significant paid-in capital of $10.6M providing a buffer for future growth, and effective management of accounts payable changes totaling $254,505.
Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.