Company: IXHL
Filing Date: 2025-02-14
Form Type: 10-Q
Source: 0001213900-25-013783
Chunk: 92

Company: Incannex Healthcare Inc.
Filing Date: 2025-02-14
Form: 10-Q
Item: Part I, Item 8
Chunk 92
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ased over the same period, reflecting higher interest received from cash deposits. 

Foreign exchange losses also increased by $0.3
million for the six months ended December 31, 2024 compared to the six months ended December 31, 2023, due to unfavorable currency exchange
rates. Interest income increased over the same period, reflecting higher interest received from cash deposits.

Currency translation adjustment, net of tax

Currency translation adjustment, net of tax, decreased
by $1.3 million for the three months ended December 31, 2024, compared to the three months ended December 31, 2023. The decrease was due
to the depreciation of the Australian dollar against the U.S. dollar. We maintain our consolidated financial statements in Australian
dollars, our functional currency, while our financial statements are translated into U.S. dollars for reporting purposes.

Currency translation adjustment, net of tax decreased
by $0.5 million for the six months ended December 31, 2024, compared to the six months ended December 31, 2023. The decrease was due to
the depreciation of the Australian dollar against the U.S. dollar.

Liquidity and Capital Resources

Sources of Liquidity

We have incurred net losses since inception and
expect to incur substantial and increasing losses in the future as we expand our R&D activities in an effort to advance our drug candidates
into later stages of development. Historically, we have funded our operations primarily through the sale of equity securities, proceeds
from the exercise of options, tax grants from R&D activities, and interest income.

We incurred total comprehensive losses of $11.4
million and $5.6 million for the six months ended December 31, 2024 and six months ended December 31, 2023, respectively. We incurred
net losses of $5.9 million and $11.3 million for the six months ended December 31, 2024 and six months ended December 31, 2023, respectively.
As of December 31, 2024, we had accumulated deficit of $122.0 million.

As of December 31, 2024, we had cash and cash equivalents of $2.1 million.
We expect our negative cash flows from operating activities to continue and thus have determined that the losses and negative cash flows
from operations and uncertainty in generating sufficient cash to meet our obligations and sustain our operations raise substantial doubt
about our ability to continue as a going concern for