NAPC Defense, Inc. (formerly Treasure & Shipwreck Recovery, Inc.) reported significant financial developments in its 10-Q filing for the quarter ending July 31, 2024. The company, which has transitioned its focus from treasure recovery to military arms and law enforcement supplies, generated revenues of $67,467 during the quarter, a notable increase from $0 in the same period of 2023. This revenue was derived from consulting services related to ammunition and military equipment.

Despite the revenue growth, the company reported a net loss of $435,863 for the three months ended July 31, 2024, compared to a net loss of $258,479 for the same period in 2023, marking a 69% increase in losses. Total operating expenses rose to $324,499, up from $243,888 in the previous year, driven primarily by a 429% increase in general and administrative expenses, which reached $137,450. The company also incurred research and development expenses of $4,103, a new cost category for this period.

As of July 31, 2024, total assets increased significantly to $3,164,231 from $1,759,732 as of April 30, 2024. Current assets also rose to $111,518, compared to $54,599 in the previous quarter. However, total liabilities surged to $2,219,876, up from $1,045,060, resulting in a working capital deficit of $968,267. Total stockholders’ equity improved to $944,355 from $714,672.

The company has been actively seeking capital to address its financial needs, raising $81,000 from the sale of common stock and $225,000 from convertible notes during the quarter. However, it remains in immediate need of further working capital, with independent auditors expressing substantial doubt about its ability to continue as a going concern.

Strategically, NAPC Defense, Inc. has made significant moves, including an acquisition agreement with Native American Pride Constructors, LLC, for rights and expertise in defense-related products, valued at $1,615,000. This acquisition involved the issuance of 95 million shares of restricted common stock. The company has also begun operations in the defense sector, separating its defense business from its shipwreck exploration activities.

The company’s operational changes include a lease agreement for commercial office space, which commenced on May 1, 2024, with a base rent of $25,000 per month. Additionally, the company has undergone a change in leadership to support its new business direction.