Company: WKSP
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-010837
Chunk: 8

Company: Worksport Ltd
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 1
Chunk 8
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 not listed were assessed and determined to be either not applicable
or had or are expected to have an immaterial impact on the financial statements and related disclosures.

    7

2.
Going Concern

As
of March 31, 2025, the Company had $5,080,372 in cash and cash equivalents. The Company also has availability on its revolving line of
credit of $2,858,700. The Company has generated only limited revenues and has relied primarily upon capital generated from public and
private offerings of its securities. Since the Company’s acquisition of Worksport in 2014, it has never generated a profit. As
of March 31, 2025, the Company had an accumulated deficit of $68,937,430.

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 three months
ended March 31, 2025, the Company had net losses of $4,460,464
(2024 - $3,714,657). As of
March 31, 2025, the Company had working capital of $7,936,250
(December 31, 2024 – $2,901,401)
and had an accumulated deficit of $68,937,430
(December 31, 2024 - $64,476,966).
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 March 31,
2025, the Company had cash and cash equivalents of $5,080,372
(December 31, 2024 - $4,883,099).
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. Concurrent