RedHawk Holdings Corp (fka SNDD)

[Codyco]

For the year ended June 30, 2020, our gross profit was 52% as compared to 34% for the comparable year ended June 30, 2019. The improvement in the gross profit margins was attributable to increased sales of the Company’s higher margin medical devices versus the Company’s branded generic pharmaceuticals. Increased sales and marketing expenses were attributable to approximately $153,921 of specialized consulting services, $166,208 of sales commissions and $48,156 of social media and advertising costs. Increases in the Company’s operating expenses were the result of $170, 219 of contract labor costs, $67,375 of investor relations costs and $21,061 of quality control costs. Additionally, during the year ended June 30, 2020, the Company incurred $118,327 of research and development costs attributable to the reverse engineering development of the Company’s SANDD Pro™ needle incineration device.