UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 28, 2023

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ___________

Commission File Number 0-14818

KASPIEN HOLDINGS INC.

(Exact Name of Registrant as Specified in its Charter)

New York		14-1541629
State or Other Jurisdiction of Incorporation or Organization		I.R.S. Employer Identification No.

2818 N. Sullivan Rd. Ste 130 Spokane Valley, WA		99216
Address of Principal Executive Offices		Zip Code

(509)-900-6287

Registrant’s Telephone Number, Including Area Code

Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $.01 par value per share	KSPN	OTCQB

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☒	Smaller reporting company ☒
	Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes ☐ No ☐

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Common Stock, $.01 par value,

4,969,738 shares outstanding as of December 10, 2023

Kaspien Holdings Inc.

KASPIEN HOLDINGS INC. AND SUBSIDIARIES

QUARTERLY REPORT ON FORM 10-Q

INDEX TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

	Form 10-Q Page No.
PART I. FINANCIAL INFORMATION

Item 1 – Interim Condensed Consolidated Financial Statements (Unaudited)

Condensed Consolidated Balance Sheets as of October 28, 2023, January 28, 2023 and October 29, 2022	4

Condensed Consolidated Statements of Operations – Thirteen Weeks and Thirty-nine Ended October 28, 2023 and October 29, 2022	5

Condensed Consolidated Statements of Comprehensive Loss – Thirteen Weeks and Thirty-nine Ended October 28, 2023 and October 29, 2022	6

Condensed Consolidated Statements of Shareholders’ Equity Deficit – Thirteen and Thirty-nine Weeks Ended October 28, 2023 and October 29, 2022	7

Condensed Consolidated Statements of Cash Flows – Thirty-nine Weeks Ended October 28, 2023 and October 29, 2022	8

Notes to Interim Condensed Consolidated Financial Statements	9

Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations	24

Item 3 – Quantitative and Qualitative Disclosures about Market Risk	33

Item 4 – Controls and Procedures	33

PART II. OTHER INFORMATION

Item 1 – Legal Proceedings	34

Item 1A – Risk Factors	34

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds	34

Item 3 – Defaults Upon Senior Securities	34

Item 4 – Mine Safety Disclosures	34

Item 5 – Other Information	34

Item 6 – Exhibits	34

Signatures	36

Index

FORWARD-LOOKING STATEMENTS

This quarterly report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, particularly in the discussion under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” All statements other than statements of historical fact are forward-looking. Examples of forward-looking statements include, but are not limited to, statements regarding our ability to achieve profitability and meet future liquidity needs and capital requirements, future business, future results of operations or financial condition, and our business strategies. You can identify many forward-looking statements by words such as “may,” “will,” “would,” “should,” “could,” “expect,” “aim,” “anticipate,” “believe,” “estimate,” “intend,” “plan,” “predict,” “project,” “seek,” “potential,” “opportunities” and other similar expressions and the negatives of such expressions. However, not all forward-looking statements contain these words. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that could cause our actual results to differ materially from those expressed or implied by the forward-looking statements contained herein. Such risks and uncertainties include, among others, those risks discussed under the caption “Risk Factors” in our most recently filed Annual Report on Form 10‑K, which was filed with the Securities and Exchange Commission (the “SEC”) on April 28, 2023 (the “2022 Form 10-K”), and in our consolidated financial statements, related notes, and the other information appearing elsewhere in the 2022 Form 10‑K, this quarterly report on Form 10-Q and our other filings with the SEC. Given these risks and uncertainties, you should not place undue reliance on any forward-looking statements. The forward-looking statements contained in this quarterly report on Form 10-Q are made only as of the date hereof, and we do not intend, and, except as required by law, we undertake no obligation to update any forward-looking statements contained herein after the date of this report to reflect actual results or future events or circumstances.

Index

KASPIEN HOLDINGS INC. AND SUBSIDIARIES

PART 1. FINANCIAL INFORMATION

Item 1 - Interim Condensed Consolidated Financial Statements

CONDENSED CONSOLIDATED BALANCE SHEETS

(Going Concern Basis)

(in thousands, except per share and share amounts)

(unaudited)

	October 28,			January 28,			October 29,
	2023			2023			2022
ASSETS	Unaudited						Unaudited
CURRENT ASSETS
Cash and cash equivalents	$	405		$	1,130		$	769
Restricted cash		1,158			1,158			1,158
Accounts receivable		1,572			1,969			2,796
Merchandise inventory		24,044			26,704			37,353
Prepaid expenses and other current assets		419			999			706
Total current assets		27,598			31,960			42,782

Restricted cash		1,063			1,338			1,601
Fixed assets, net		1,637			1,999			2,140
Operating lease right-of-use assets		1,015			1,505			1,678
Cash Surrender Value		4,042			3,371			3,563
Other assets		566			566			682
TOTAL ASSETS	$	35,921		$	40,739		$	52,446

LIABILITIES
CURRENT LIABILITIES
Accounts payable	$	5,705		$	7,044		$	12,648
Short-term borrowings		8,874			8,812			9,494
Short-term debt		11,748			-			-
Accrued expenses and other current liabilities		3,194			2,876			1,962
Current portion of operating lease liabilities		652			695			634
Total current liabilities		30,173			19,427			24,738

Operating lease liabilities		588			1,019			1,253
Long-term debt		-			9,790			9,163
Other long-term liabilities		11,158			11,604			13,590
TOTAL LIABILITIES		41,919			41,840			48,744

SHAREHOLDERS’ EQUITY (Deficit)
Preferred stock ($0.01 par value; 5,000,000 shares authorized; none issued)		-			-			-
Common stock ($0.01 par value; 200,000,000 shares authorized; 5,437,197 5,432,072 and 5,322,363 shares issued, respectively)		54			54			53
Additional paid-in capital		214,212			214,029			213,992
Treasury stock at cost (467,069, 467,459 and 1,410,378 shares, respectively)		(76,132	)		(76,132	)		(76,132	)
Accumulated other comprehensive loss		886			886			(910	)
Accumulated deficit		(145,018	)		(139,938	)		(133,301	)
TOTAL SHAREHOLDERS’ EQUITY (Deficit)		(5,998	)		(1,101	)		3,702
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY (Deficit)	$	35,921		$	40,739		$	52,446

See Accompanying Notes to Interim Condensed Consolidated Financial Statements.

Index

KASPIEN HOLDINGS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Going Concern Basis)

(amounts in thousands)

(unaudited)

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
	October 28,		October 29,		October 28,		October 29,
	2023		2022		2023		2022

Net revenue	$	26,434	$	29,145	$	92,502	$	94,843

Cost of sales		20,318		22,570		71,615		74,688
Gross profit		6,116		6,575		20,887		20,155
Selling, general and administrative expenses

SEC Form 10-Q filed by Kaspien Holdings Inc.