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BioHarvest Sciences Inc.
Unaudited Interim Condensed Consolidated Financial Statements For the Three and Six Months Ended June 30, 2025
Expressed in U.S. dollars in thousands
BioHarvest Sciences Inc.
Unaudited Interim Condensed Consolidated Financial Statements For the Three and Six Months Ended June 30, 2025
Expressed in U.S. dollars in thousands
| Page | |
| FINANCIAL STATEMENTS: | |
| Unaudited Interim Condensed Consolidated Statements of Financial Position | 3 |
| Unaudited Interim Condensed Consolidated Statements of Loss and Other Comprehensive Loss | 4 |
| Unaudited Interim Condensed Consolidated Statements of Changes in Shareholders ' Equity (Deficit) | 5-6 |
| Unaudited Interim Condensed Consolidated Statements of Cash Flows | 7 |
| Notes to the Unaudited Interim Condensed Consolidated Financial Statements | 8-24 |
| Notes | As at June 30, 2025 | As at December 31, 2024 | |
| Assets | |||
| Current assets | |||
| Cash and cash equivalents | $ 3,727 | $ 2,390 | |
| Trade accounts receivable | 1,614 | 1,116 | |
| Other accounts receivable | 858 | 695 | |
| Inventory | 4,127 | 3,655 | |
| Total current assets | 10,326 | 7,856 | |
| Non-current | |||
| Restricted cash | 397 | 371 | |
| Property and equipment, net | 8,232 | 7,750 | |
| Right-of-use assets, net | 3 | 8,843 | 9,024 |
| Total non-current assets | 17,472 | 17,145 | |
| Total assets | $ 27,798 | $ 25,001 | |
| Liabilities | |||
| Current liabilities | |||
| Trade accounts payable | $ 3,421 | $ 3,525 | |
| Other accounts payable | 4,503 | 3,609 | |
| Deferred revenue | 990 | 906 | |
| Lease liabilities | 3 | 1,454 | 772 |
| Loans | 6 | 4,722 | 3,905 |
| Liability for Agricultural Research Organization | 1,552 | 1,140 | |
| Accrued liabilities | 463 | 401 | |
| Total current liabilities | 17,105 | 14,258 | |
| Non-current liabilities | |||
| Lease liability | 3 | 9,654 | 9,141 |
| Loans | 6 | 5,262 | - |
| Liability to Agricultural Research Organization | - | 272 | |
| Total non-current liabilities | 14,916 | 9,413 | |
| Shareholders' equity (deficit) | |||
| Share capital and contributed surplus | 4 | 98,613 | 97,748 |
| Accumulated deficit | (102,836) | (96,418) | |
| Total Shareholders' equity (deficit) | (4,223) | 1,330 | |
| Total liabilities and shareholders' equity (deficit) | $ 27,798 | $ 25,001 |
Going concern (Note 1B)
| August 11, 2025 | Zaki Rakib' | Ilan Sobel' | ||
| Date of approval of the financial statements | Chairman of the Board | Chief Executive Officer |
The accompanying notes are an integral part of these Interim Unaudited Condensed Consolidated Financial Statements.
| Three-months period ended June 30, | Six-months period ended June 30, | |||
| 2025 | 2024 | 2025 | 2024 | |
| Revenues | $ 8,515 | $ 6,027 | $ 16,375 | $ 11,371 |
| Cost of revenues | 3,429 | 2,925 | 6,694 | 5,266 |
| Gross profit | 5,086 | 3,102 | 9,681 | 6,105 |
| Operating expenses | ||||
| Research and development | 1,337 | 1,088 | 2,582 | 2,122 |
| Sales and marketing | 3,987 | 2,812 | 7,668 | 5,376 |
| General and administrative | 1,577 | 978 | 2,965 | 1,807 |
| Total operating expenses | (6,901) | (4,878) | (13,215) | (9,305) |
| Operating loss | (1,815) | (1,776) | (3,534) | (3,200) |
| Finance income | - | (1,467) | - | (49) |
| Finance expenses | 2,226 | 378 | 2,807 | 4,117 |
| Net loss before tax | (4,041) | (687) | (6,341) | (7,268) |
| Taxes on income | 39 | - | 77 | - |
| Net loss and comprehensive loss | $ (4,080) | $ (687) | $ (6,418) | $ (7,268) |
| Basic and diluted loss per share | (0.24) | (0.04) | (0.37) | (*) (0.48) |
| Weighted average number of shares outstanding | 17,328,348 | 16,348,802 | 17,328,347 | (*) 15,047,396 |
(*) After giving effect to the share consolidation indicated in Note 4b
The accompanying notes are an integral part of these Interim Unaudited Condensed Consolidated Financial Statements.
For the six-month period ended June 30, 2025:
| Number of shares | Share capital and contributed surplus | Accumulated deficit | Total equity (deficit) | ||||
| Balance, December 31, 2024 | 17,327,716 | $ | 97,748 | $ | (96,418) | $ | 1,330 |
| Share based compensation | - | 316 | - | 316 | |||
| Issuance of shares in lieu of vested RSUs | 5,714 | - | - | - | |||
| Warrants extension (Note 4) | - | 549 | - | 549 | |||
| Comprehensive loss for the period | - | - | (6,418) | (6,418) | |||
| Balance, June 30, 2025 | 17,333,430 | $ | 98,613 | $ | (102,836) | $ | (4,223) |
For the six-month period ended June 30, 2024
| Number of shares (*) | Share capital and contributed surplus | Accumulated deficit | Total equity (deficit) | ||||
| Balance, December 31, 2023 | 13,676,798 | $ | 68,652 | $ | (83,505) | $ | (14,853) |
| Exercise of options and warrants by employees and consultants | 106,132 | 408 | - | 408 | |||
| Share based compensation | - | 328 | - | 328 | |||
| Conversion of Convertible Loans | 2,940,882 | 20,527 | - | 20,527 | |||
| Issuance of warrants | - | 2,296 | - | 2,296 | |||
| Reclassification of warrants | - | 934 | - | 934 | |||
| Issuance of units of securities | 603,904 | 4,330 | - | 4,330 | |||
| Comprehensive loss for the period | - | - | (7,268) | (7,268) | |||
| Balance, June 30, 2024 | 17,327,716 | $ | 97,475 | $ | (90,773) | $ | 6,702 |
(*) After giving effect to the share consolidation indicated in Note 4b
The accompanying notes are an integral part of these Interim Unaudited Condensed Consolidated Financial Statements.
| Six-months period ended June 30, | ||
| 2025 | 2024 | |
| Cash flows from operating activities: | ||
| Net loss | $ (6,418) | $ (7,268) |
| Adjustments to reconcile net loss to net cash used in operating activities: | ||
| Depreciation and Amortization | 806 | 559 |
| Fair value adjustments of Convertible loans | - | 3,453 |
| Fair value adjustments of derivative liability - Warrants | - | 408 |
| Interest over Agricultural Research Organization liability | 139 | 187 |
| Finance expense (income), net | 1,920 | (13) |
| Share based compensation | 316 | 328 |
| Changes in operations assets and liabilities: | ||
| Change in trade accounts receivable | (498) | (97) |
| Change in other accounts receivable | (163) | (191) |
| Change in inventory | (472) | (102) |
| Changes in trade accounts payable, other accounts payable and accrued liabilities | 1,402 | (*) 241 |
| Changes in deferred revenue | 85 | (*) (3) |
| Cash used in operations | (2,883) | (2,498) |
| Interest paid | - | (38) |
| Net cash used in operating activities | (2,883) | (2,536) |
| Cash flow from investing activities: | ||
| Purchase of property and equipment | (1,276) | (1,930) |
| Deposit of restricted cash for bank guarantee, net of drawing | 4 | (225) |
| Net cash used in investing activities | (1,272) | (2,155) |
| Cash flow from financing activities: | ||
| Repayments of lease liabilities | (477) | (248) |
| Proceeds from loans, net of repayments | 5,985 | - |
| Net proceeds from issuance of units of securities | - | 4,330 |
| Exercise of options and warrants by employees and consultants | - | 408 |
| Net cash provided by financing activities | 5,508 | 4,490 |
| Exchange rate differences on cash and cash equivalents | (16) | 14 |
| Increase (Decrease) in cash and cash equivalents | 1,353 | (201) |
| Cash and cash equivalents at the beginning of the period | 2,390 | 5,355 |
| Cash and cash equivalents at the end of the period | $ 3,727 | $ 5,168 |
| Significant non-cash transactions: | ||
| Conversion of Convertible loans into shares | - | 20,527 |
| Reclassification of warrants as an equity instrument | - | 934 |
| Purchase of property in installment agreement | - | 1,995 |
| Recognition of right-of-use assets and lease liabilities | 399 | 8,648 |
(*) Certain comparative amounts have been reclassified to conform to the current period presentation
The accompanying notes are an integral part of these Condensed Consolidated Interim Financial Statements.
A.Description of the Company and its operations:
BioHarvest Sciences Inc. (the "Company" or "BioHarvest Sciences"), together with its wholly owned subsidiaries, was incorporated under the Business Corporations Act of British Columbia on April 19, 2013. The Company fully owns BioHarvest Ltd. ("BioHarvest"), a company incorporated in Israel, and Superfood Nutraceuticals Inc. ("Superfood") a company incorporated in Delaware, USA.
BioHarvest was incorporated in January 2007 and commenced its activity in July 2007.
In July 2014, BioHarvest Ltd incorporated a Delaware based wholly owned subsidiary, BioHarvest Inc ("BioHarvest Inc").
On October 28, 2020, BioHarvest Sciences incorporated a Delaware based wholly owned subsidiary, Superfood Nutraceuticals Inc. ("Superfood").
The Company is publicly listed and traded on the Nasdaq Stock Market under the symbol BHST, traded on the Frankfurt Stock Exchange under the symbol 8MV0, traded on the Munich Stock Exchange under the symbol 8MV0, traded on the Stuttgart Stock Exchange under the symbol 8MV0 and traded on the Dusseldorf Stock Exchange under the symbol 8MV0.
On February 14, 2025, the Company completed a voluntary delisting process of its common shares from the Canadian Securities Exchange and continue to be listed on the Nasdaq Stock Market.
The registered address of the Company is 1140-625 Howe St., Vancouver, BC V6C 2T6, Canada.
Description of Business
The Company is a biotechnology company that has developed the Botanical Synthesis Platform Technology, which enables the Company to grow, at an industrial scale, the active and beneficial ingredients in certain fruits and plants without the need to grow the plant itself. The Botanical Synthesis Platform Technology is the only non-genetically modified organism platform that can produce plant cells with significantly higher concentrations of active ingredients (as compared to those that are produced naturally), as well as extremely high levels of solubility and bio-availability. The Botanical Synthesis Platform Technology is economical, ensures consistency and avoids the negative environmental impacts associated with traditional agriculture by providing consistent product production, a year-round production cycle and products that are devoid of sugar, calories and contaminants, such as pesticides, heavy metals and residues.
The Company is currently focused on utilizing the Botanical Synthesis Platform Technology to develop the next generation of science-based and clinically proven therapeutic solutions through two business units:
1.The Products Business Unit, comprises:
a)Nutraceuticals: Research, development, manufacturing, marketing and sales of science-based therapeutic nutraceutical solutions (capsules, powders, chews and other delivery mechanisms such as coffee, teas and protein bars);
b)Cosmeceuticals: Research and development for future manufacturing, marketing and sales of science-based therapeutic cosmeceutical solutions; and
NOTE 1 - GENERAL (Continued):
2.The CDMO Services Business Unit comprising a Contract Development and Manufacturing Operation ("CDMO") that offers customers from the pharmaceutical, cosmeceutical, nutraceutical and nutrition industries the development and future manufacturing of specific plant-based active molecules, via an end-to-end service agreement.
The Company has incurred losses from operations since its inception. As of June 30, 2025, the Company has an accumulated deficit of $102,836. The Company generated negative cash flows from operating activities of $2,883 and a loss in the amount of $6,418 for the six month period ended June 30, 2025. As of the date of the issuance of these unaudited interim condensed consolidated financial statements, the Company has not yet commenced generating sufficient sales to fund its operations and therefore depends on fundraising from new and existing investors to finance its activities. These factors raise a substantial doubt about the Company's ability to continue as a going concern.
The Company's management plans to fund near-term anticipated activities based on proceeds from capital fund raising, debt instruments in the form of convertible loans, short-term loans, long-term loans and future revenues.
The unaudited interim condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
The accompanying unaudited interim condensed consolidated financial statements of the Company were authorized for issue by the Board of Directors on August 11, 2025.
The Company's principal place of business, operations and its facilities, where most of its employees are employed, are located in Rehovot and Yavne, Israel. In addition, the majority of the Company's key employees and senior management are Israeli citizens.
On October 7, 2023, Hamas terrorists infiltrated Israel's southern border from the Gaza Strip and conducted a series of attacks on civilian and military targets. Following the attack, Israel declared war against Hamas and the Israeli military began to call-up reservists for an active duty.
At the same time, there is also a war between Israel and Hezbollah in Lebanon. On November 27, 2024, a ceasefire agreement was signed by Israel and Lebanon until February 18, 2025. A large-scale fighting between Israel and Hezbollah has not resumed despite the ceasefire's expiry and the lack of a follow-up agreement.
In June 2025, a significant escalation in hostilities occurred between Israel and Iran, resulting in widespread military operations. On June 24, 2025, Israel and Iran agreed on an immediate ceasefire.
As of the date of these unaudited interim condensed consolidated financial statements, these events have had no material impact on the Company's operations.
NOTE 2 - BASIS OF PREPARATION:
These financial statements have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standard Board and Interpretations (collectively IFRS Accounting Standards). These interim unaudited condensed consolidated financial statements have been prepared in accordance with International Accounting Standards IAS 34 Interim Financial Reporting.
These unaudited interim condensed consolidated financial statements do not include all the information required for annual consolidated financial statements and should be read in conjunction with the Company's annual financial statements as of December 31, 2024. The significant accounting policies applied in the annual financial statements of the Company as of December 31, 2024, are applied consistently in these unaudited interim consolidated financial statements.
New IFRSs adopted in the period
The following amendments are effective for the period beginning January 1, 2025:
On August 15, 2023, the IASB issued Lack of Exchangeability which amended IAS 21 The Effects of Changes in Foreign Exchange Rates (the Amendments).
These Amendments are applicable for annual reporting periods beginning on or after 1 January 2025. The Amendments introduce requirements to assess when a currency is exchangeable into another currency and when it is not. The Amendments require an entity to estimate the spot exchange rate when it concludes that a currency is not exchangeable into another currency. The Amendments also introduce additional disclosure requirements when an entity estimates a spot exchange rate because a currency is not exchangeable into another currency. IAS 21, prior to the Amendments, did not include explicit requirements for the determination of the exchange rate when a currency is not exchangeable into another currency, which led to diversity in practice. When applying the Amendments, an entity is not permitted to restate comparative information. These Amendments have had no material effect on the unaudited interim condensed consolidated financial statements.
The Company leases several facilities in Israel from which it operates. The Company also leases certain items of property and equipment which contain a lease of vehicles.
All leases are stated in Israeli New Shekel ("NIS" or "ILS") and accounted for by recognizing a right-of-use asset and a lease liability except for:
a)Leases with low value assets; and
b)Leases with a duration of 12 months or less.
On January 16, 2025, the Company amend its lease agreement with the lessor for its Yavne manufacturing facility, until September 2025, subject to 2 extension options for an additional 6 months each. The average monthly fees are NIS 101 ($28), including an annual increase and other adjustments, subject to the Consumer Price Index published by the Israeli Central Bureau of Statistics.
At the commencement of the lease, the Company believes it is probable the 2 extension options for an additional total of 1 year will be exercised.
NOTE 3 - LEASES (Continued):
On June 1, 2025, the Company amend its lease agreement with the lessor for its Rehovot laboratories and offices facilities, until May 2028. The Company has the option to terminate the lease agreement (partially or completely) within the lease period. The average monthly fees are NIS 63 ($18) subject to the Consumer Price Index published by the Israeli Central Bureau of Statistics.
At the commencement of the lease, the Company believes it is probable that the lease agreement will be partially terminated early.
NOTE 4 - SHARE CAPITAL:
| Number of shares | ||
| June 30, 2025 | December 31, 2024 | |
| Issued and outstanding | Issued and outstanding | |
| Common shares | 17,333,430 | 17,327,716 |
a)The Company is authorized to issue an unlimited number of common shares.
b)On May 27, 2024, the Company's shareholders approved a 35-for-1 share consolidation, (hereinafter referred to as the 35:1 Share Consolidation) of the Company's common shares pursuant to which the holders of the Company's common shares received one common share for every 35 common shares held. The 35:1 Share Consolidation was approved by the Canadian Securities Exchange and is effective from June 3, 2024. All common shares (issued and unissued) were consolidated on the basis that every 35 common shares of no-par value were consolidated into 1 common share of no-par value.
c)On April 11, 2025, the Company extended the expiry date of 493,239 Early Conversion Warrants and 257,143 Major Investor Warrants by additional 24 months in connection with the new loan facilities (Note 6C) (referring to the Company's annual financial statements as of December 31, 2024, for further details regarding Early Conversion Warrants and Major Investor Warrants).
d.On June 3, 2025, the Company extended the expiry date of 9,794 Early Conversion Warrants by additional 24 months in connection with the new loan facilities (Note 6C) (referring to the Company's annual financial statements as of December 31, 2024, for further details regarding Early Conversion Warrants).
e.On June 10, 2025, the Company issued 5,714 common shares in lieu of vested RSUs.
NOTE 4 - SHARE CAPITAL (Continued):
f)The following table summarizes information about the warrants outstanding as at June 30, 2025:
| Warrants Outstanding | ||
| June 30, 2025 | Exercise Price | Expiry Date |
| (*) 261,031 | (*) $7.77 | October 30, 2025 |
| (*) 257,143 | (*) $7.77 | October 30, 2027 |
| 150,978 | $11.52 | December 28, 2025 |
| 724,904 | $7.77 | October 30, 2025 |
| 453,597 | $7.77 | October 30, 2027 |
| 131,279 | $7.77 | December 22, 2025 |
| 49,436 | $7.77 | December 22, 2027 |
| 2,028,368 | - | - |
(*) After giving effect to the share consolidation indicated in Note 4b
NOTE 5 - SHARE BASED COMPENSATION:
a)Options granted under the Company's 2008 Israeli Share Option Plan ("Plan") are exercisable within 10 years from the date of grant upon payment of the exercise price as indicated in the Plan.
b)The following table summarizes information regarding expenses relating to share-based compensation:
| Three months ended June 30, 2025 | Six months ended June 30, 2025 | Three months Ended June 30, 2024 | Six months Ended June 30, 2024 | |
| Equity settled compensation | 184 | 316 | 194 | 328 |
| 184 | 316 | 194 | 328 |
c)A summary of activity related to options granted to purchase the Company's shares under the Company's share option plan is as follows:
| June 30, 2025 | December 31, 2024(*) | |||
| Number of Options | Weighted Average Exercise Price | Number of Options (*) | Weighted Average Exercise Price | |
| Options outstanding at beginning of period | 1,902,090 | 6.30 | 1,807,456 | 6.15 |
| Changes during the period: | ||||
| Granted | - | - | 214,885 | 6.23 |
| Exercised | - | - | (106,132) | 3.67 |
| Forfeited | (16,310) | 6.85 | (14,119) | 5.89 |
| Options outstanding at the end of the period (**) | 1,885,780 | 6.33 | 1,902,090 | 6.30 |
| Options exercisable at end of period | 1,693,203 | 6.36 | 1,620,445 | 6.04 |
NOTE 5 - SHARE BASED COMPENSATION (Continued):
(*) After giving effect to the share consolidation indicated in Note 4b
(**) The options outstanding on June 30, 2025, had a weighted-average contractual life of 6.03 years (June 30, 2024: 6.80 years)
d)A summary of activity related to warrants granted to purchase the Company's shares, accounted for as share based compensation, is as follows:
| June 30, 2025 | December 31, 2024(*) | |||
| Number of Warrants | Weighted Average Exercise Price | Number of Warrants | Weighted Average Exercise Price | |
| Warrants outstanding at the beginning of the period | 73,557 | 7.54 | 64,986 | 7.66 |
| Changes during the period: | ||||
| Issued | - | - | 8,571 | 6.65 |
| Exercised | - | - | - | - |
| Expired | - | - | - | - |
| Warrants outstanding at the end of the period(**) | 73,557 | 7.54 | 73,557 | 7.54 |
(*) After giving effect to the share consolidation indicated in Note 4b.
The following table summarizes information about the warrants outstanding as at June 30, 2025:
| Warrants Outstanding | ||
| June 30, 2025 (*) | Exercise Price (*) | Expiry Date |
| 64,986 | $7.66 | October 25, 2027 |
| 8,571 | $6.65 (CAD 9.1) | April 26, 2026 |
| 73,557 |
(*) After giving effect to the share consolidation indicated in Note 4b
e.On April 11, 2025, the Company extended the expiry date of 64,986 warrants by additional 24 months in connection with the new loan facilities (Note 6C).
During the six-month period ended June 30, 2025, the Company borrowed from private investors $1,677 under the following terms:
1)The Company will pay a 16% annual interest rate, with equal payments to be made monthly against both principal and interest.
2)The Company will pay a 20% annual interest rate with a payment of both principal and interest at the end of the loan term.
Any loan amount will have a term of 12 months from the date the funds are received.
A summary of movements of principal and interest during the six-month period ending June 30, 2025, is as follows:
| 16% | 20% | Total | |
| Balance as of January 1, 2024 | - | - | - |
| Proceeds from drawing loans | 1,510 | 1,907 | 3,417 |
| Accrued interest recognized in Profit or loss | 26 | 34 | 60 |
| Repayment of principal and interest | (103) | - | (103) |
| Balance as of December 31, 2024 | 1,433 | 1,941 | 3,374 |
| Proceeds from drawing loans | 1,040 | 637 | 1,677 |
| Accrued interest recognized in Profit or loss | 160 | 260 | 420 |
| Repayment of principal and interest | (1,305) | - | (1,305) |
| Balance as of June 30, 2025 | 1,328 | 2,838 | 4,166 |
The outstanding balance is presented as short-term loan.
B.Unconverted portion of Convertible loan A:
On maturity date of Convertible loan A (referring to the Company's annual financial statements as of December 31, 2024, for further details regarding convertible loan A). an amount of $521 of unconverted portion of Principal Loan Amount and any interest accrued up to the maturity date is due for immediate payment. The Company accrue interest of 9% per annum over the due amount from the maturity date up to the date it will fully repay. The lenders are entitled to demand, at any time, immediate payment of the due amount.