Company: WKSP
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-010837
Chunk: 39

Company: Worksport Ltd
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 1
Chunk 39
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4,883,099 at December 31, 2024, to $5,080,372 at March
31, 2025 – an increase of $197,273 or 4%. The increase was primarily due to capital raising through financing activities.

Operating
Activities

Net
cash used in operating activities for the three months ended March 31, 2025 was $3,839,918, compared to $2,794,604 in 2024, primarily
driven by the shift to production and distribution of hard tonneau covers.

Accounts
receivable increased at March 31, 2025 by $25,362 and decreased by $306,778 in the prior period. The increase in accounts receivable
was due to further development of our Distributor and Jobber customer network and relationships.

Inventory
increased at March 31, 2025 by $583,116, and increased at March 31, 2024 by $2,908,354, as a result of stockpiling of finished goods
and raw materials in preparation for the launch of our AL4 product line. Prepaid expenses and deposits increased by $192,071 at March
31, 2025, and decreased by $1,155,090 at March 31, 2024 due to timing of deposits from B2C customers prior to fulfillment of their orders
at the end of the accounting period.

Accounts payable and accrued liabilities increased at March 31, 2025 by
$390,691 compared to an increase of $729,303 at March 31, 2024.

Investing
Activities

Net
cash used in investing activities for the three months ended March 31, 2025 was $458,342 compared to $212,969 for the three months
ended March 31, 2024. The increase in investing activities was primarily attributable to our purchase of cryptocurrency and website
enhancements, both of which are classified as intangible assets. We also acquired additional tooling components for our COR production process.

22

Financing
Activities

Net cash provided by financing activities for the three months ended March
31, 2025 was $4,495,533 compared to net cash used in financing activities of $3,178,775 for the three months ended March 31, 2024.

Off-Balance
Sheet Arrangements

We
did not have any material off-balance sheet arrangements that have or are reasonably likely to have a material