NAPC Defense Reports Increased Losses and Financial Challenges in Latest Filing

NAPC Defense, Inc., formerly known as Treasure & Shipwreck Recovery, Inc., reported significant financial challenges in its latest 10-Q filing for the period ending January 31, 2025. The company generated $67,467 in service revenue during the nine months ended January 31, 2025, a notable increase from zero revenue in the same period the previous year. However, this revenue was deemed uncollectible, leading to a write-off that contributed to a net loss of $1,528,996 for the nine months, compared to a loss of $507,714 in the prior year, marking a 201% increase in losses.

Operating expenses surged to $788,727 for the nine months ended January 31, 2025, up from $462,726 in the same period last year, reflecting a 70% increase. The rise in expenses was driven by substantial increases in general and administrative costs, which rose from $31,343 to $250,162, and rent expenses, which escalated from $9,600 to $230,000 due to the leasing of a new commercial office and warehouse facility. The company also reported a significant increase in legal fees and consulting costs, indicating a shift in operational focus towards its new defense-related business segment.

In terms of financial position, as of January 31, 2025, NAPC Defense reported total assets of $1,631,686, a decrease from $1,814,331 as of April 30, 2024. Current liabilities remained relatively stable at $1,051,067, leading to a working capital deficit of $1,035,381. The company’s stockholders' equity also declined to $580,619 from $769,271, reflecting ongoing financial strain. The company has indicated that it is in immediate need of additional working capital and is exploring options for financing through debt or equity.

Strategically, NAPC Defense has transitioned from its original treasure recovery business to focus on defense and law enforcement products, including the production and supply of CornerShot units under a licensing agreement. This shift was formalized with a name change in April 2024 and the acquisition of rights and intellectual property from Native American Pride Constructors, LLC. The company aims to leverage these new capabilities to enter the military arms market, although it continues to maintain a limited presence in treasure recovery.

Looking ahead, management has expressed concerns about the company's ability to continue as a going concern, given its history of losses and current cash flow challenges. The company expects to exhaust its available cash by late March 2025 unless it can secure additional funding. Future operations will depend heavily on the successful execution of its new business strategy and the ability to raise capital, which remains uncertain in the current market environment.