Company: WKSP
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001641172-25-000850
Chunk: 16

Company: Worksport Ltd
Filing Date: 2025-03-27
Form: 10-K
Item: Item 8
Chunk 16
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 the Company’s acquisition of Worksport in  2014, it has never generated a profit. As of December 31, 2024,
the Company had an accumulated deficit of $64,476,966.

The
accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates
the realization of assets and the liquidation of liabilities in the normal course of business. During the year ended December 31, 2024,
the Company had net losses of $16,163,789 (2023 - $14,928,958). As of December 31, 2024, the Company had working capital of $7,304,110
(2023 – $1,956,894) and had an accumulated deficit of $64,476,966 (2023 - $48,313,177). The Company has not generated profit from
operations since inception and to date has relied on debt and equity financing for continued operations. The Company’s ability
to continue as a going concern is dependent upon the ability to generate cash flows from operations and obtain equity and/or debt financing.
The Company intends to continue funding operations through equity and debt financing arrangements, which may be insufficient to fund
its capital expenditures, working capital and other cash requirements in the long term. There can be no assurance that the steps management
is taking will be successful.

The
Company has historically operated at a loss, although that may change as sales volumes increase and margins improve. As of December 31,
2024, the Company had cash and cash equivalents of $4,883,099 (2023 - $3,365,778). Despite the Company having completed its purchasing
of large manufacturing machinery for phase one output levels, operational costs are expected to remain elevated and, thus, further decrease
cash and cash equivalents. Concurrently, the Company intends to continue its ramp-up of manufacturing and increasing sales volumes in
2025, which should mitigate the effects of operational costs on cash and cash equivalents as it releases new product lines; this view
is supported by the fact that the manufacturing facility of the Company was completed for initial production output in 2023 and quickly
began improving output and sales during 2024.

The
Company has successfully raised cash, and it is positioned to do so again if deemed necessary or strategically advantageous. During the
year ended December 31, 2021, the Company, through its Reg-A public offering, private placement offering, underwritten