Full Press Release Details
CARDIOL THERAPEUTICS INC.
CONDENSED INTERIM CONSOLIDATED
FINANCIAL STATEMENTS
THREE AND NINE MONTHS ENDED
(EXPRESSED IN CANADIAN DOLLARS)
Cardiol Therapeutics Inc.
Consolidated Statements of Financial Position
in Canadian Dollars)
| As at | As at | |||||||
| September 30, | December 31, | |||||||
| 2024 | 2023 | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents (note 3) | $ | 15,885,018 | $ | 34,931,778 | ||||
| Accounts receivable | 57,079 | 142,745 | ||||||
| Other receivables | 209,627 | 137,127 | ||||||
| Prepaid expenses | 1,129,995 | 941,442 | ||||||
| Total current assets | 17,281,719 | 36,153,092 | ||||||
| Non-current assets | ||||||||
| Property and equipment (note 4) | 237,926 | 337,058 | ||||||
| Intangible assets (note 5) | - | 210,358 | ||||||
| Total assets | $ | 17,519,645 | $ | 36,700,508 | ||||
| EQUITY AND LIABILITIES | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued liabilities (note 14) | $ | 6,918,639 | $ | 8,041,485 | ||||
| Current portion of lease liability (note 6) | 31,785 | 15,808 | ||||||
| Derivative liability (note 7) | 3,647 | 238,176 | ||||||
| Total current liabilities | 6,954,071 | 8,295,469 | ||||||
| Non-current liabilities | ||||||||
| Lease liability (note 6) | 134,199 | 158,532 | ||||||
| Total liabilities | 7,088,270 | 8,454,001 | ||||||
| Equity | ||||||||
| Share capital (note 8) | 154,631,158 | 148,519,136 | ||||||
| Warrants (note 10) | - | 3,517,867 | ||||||
| Contributed surplus | 27,499,751 | 18,786,306 | ||||||
| Deficit | (171,699,534 | ) | (142,576,802 | ) | ||||
| Total equity | 10,431,375 | 28,246,507 | ||||||
| Total equity and liabilities | $ | 17,519,645 | $ | 36,700,508 |
The accompanying notes to the unaudited condensed
interim consolidated financial statements are an integral part of these consolidated financial statements.
Commitments (notes 5 and 12)
Subsequent events (notes 5, 7, 9, and 15)
Approved on behalf of the Board:
Cardiol Therapeutics Inc.
Condensed Interim Consolidated Statements
of Loss and Comprehensive Loss
in Canadian Dollars)
| Three Months Ended September 30, 2024 | Three Months Ended September 30, 2023 | Nine Months Ended September 30, 2024 | Nine Months Ended September 30, 2023 | |||||||||||||
| Operating expenses (notes 9, 13, 14) | ||||||||||||||||
| General and administration | $ | 10,389,712 | $ | 5,079,140 | $ | 20,503,966 | $ | 11,572,844 | ||||||||
| Research and development | 3,750,688 | 2,576,751 | 9,783,261 | 10,183,832 | ||||||||||||
| Loss before other income | (14,140,400 | ) | (7,655,891 | ) | (30,287,227 | ) | (21,756,676 | ) | ||||||||
| Interest income | 201,864 | 515,538 | 886,567 | 1,590,162 | ||||||||||||
| Gain (loss) on foreign exchange | (142,033 | ) | 667,548 | 638,919 | (84,569 | ) | ||||||||||
| Change in derivative liability (note 7) | 1,352,085 | 392,881 | 234,529 | (389,931 | ) | |||||||||||
| Other income | - | 149,739 | 28,223 | 149,739 | ||||||||||||
| Net loss and comprehensive loss for the period | $ | (12,728,484 | ) | $ | (5,930,185 | ) | $ | (28,498,989 | ) | $ | (20,491,275 | ) | ||||
| Basic and diluted net loss per share (note 11) | $ | (0.18 | ) | $ | (0.09 | ) | $ | (0.42 | ) | $ | (0.32 | ) | ||||
| Weighted average number of common shares outstanding | 69,841,202 | 64,487,862 | 68,621,684 | 64,229,845 |
The accompanying notes to the unaudited condensed
interim consolidated financial statements are an integral part of these consolidated financial statements.
Cardiol Therapeutics Inc.
Condensed Interim Consolidated Statements
in Canadian Dollars)
| Nine Months Ended September 30, 2024 | Nine Months Ended September 30, 2023 | |||||||
| Operating activities | ||||||||
| Net loss and comprehensive loss for the period | $ | (28,498,989 | ) | $ | (20,491,275 | ) | ||
| Adjustments for: | ||||||||
| Depreciation of property and equipment | 114,263 | 118,261 | ||||||
| Amortization of intangible assets | 210,358 | 63,333 | ||||||
| Share-based compensation | 11,130,090 | 3,144,014 | ||||||
| Change in derivative liability | (234,529 | ) | 389,931 | |||||
| Unrealized foreign exchange (gain) loss on cash | (286,123 | ) | 118,913 | |||||
| Accretion on lease liability | 19,332 | 8,948 | ||||||
| Shares for services | - | 16,449 | ||||||
| Changes in non-cash working capital items: | ||||||||
| Accounts receivable | 85,666 | 31,933 | ||||||
| Other receivables | (72,500 | ) | 158,669 | |||||
| Prepaid expenses | (188,553 | ) | (131,909 | ) | ||||
| Accounts payable and accrued liabilities | (1,746,589 | ) | (2,142,948 | ) | ||||
| Net cash used in operating activities | (19,467,574 | ) | (18,715,681 | ) | ||||
| Investing activities | ||||||||
| Purchase of property and equipment | (15,131 | ) | (53,606 | ) | ||||
| Net cash used in investing activities | (15,131 | ) | (53,606 | ) | ||||
| Financing activities | ||||||||
| Proceeds from stock options exercised | 177,510 | - | ||||||
| Payment of lease liability | (27,688 | ) | (41,532 | ) | ||||
| Net cash provided by (used in) financing activities | 149,822 | (41,532 | ) | |||||
| Net change in cash and cash equivalents | (19,332,883 | ) | (18,810,819 | ) | ||||
| Cash and cash equivalents, beginning of period | 34,931,778 | 59,469,868 | ||||||
| Impact of foreign exchange on cash and cash equivalents | 286,123 | (118,913 | ) | |||||
| Cash and cash equivalents, end of period | $ | 15,885,018 | $ | 40,540,136 | ||||
| Supplemental information | ||||||||
| Deferred share issuance costs included in accounts payable and accrued liabilities | $ | (623,743) | $ | - |
The accompanying notes to the unaudited condensed
interim consolidated financial statements are an integral part of these consolidated financial statements.
Cardiol Therapeutics Inc.
Condensed Interim Consolidated Statements
of Changes in Equity
in Canadian Dollars)
| Share capital | Contributed | ||||||||||||||||||||||
| Number | Amount | Warrants | surplus | Deficit | Total | ||||||||||||||||||
| Balance, December 31, 2022 | 64,042,536 | $ | 147,545,399 | $ | 3,517,867 | $ | 15,586,832 | $ | (114,448,510 | ) | $ | 52,201,588 | |||||||||||
| Restricted share units exercised | 150,245 | 211,845 | - | (211,845 | ) | - | - | ||||||||||||||||
| Shares for services | 5,000 | 16,449 | - | - | - | 16,449 | |||||||||||||||||
| Share-based compensation (note 9) | - | - | - | 3,144,014 | - | 3,144,014 | |||||||||||||||||
| Performance share units exercised | 600,000 | - | - | - | - | - | |||||||||||||||||
| Net loss and comprehensive loss for the period | - | - | - | - | (20,491,275 | ) | (20,491,275 | ) | |||||||||||||||
| Balance, September 30, 2023 | 64,797,781 | $ | 147,773,693 | $ | 3,517,867 | $ | 18,519,001 | $ | (134,939,785 | ) | $ | 34,870,776 | |||||||||||
| Balance, December 31, 2023 | 65,352,279 | $ | 148,519,136 | $ | 3,517,867 | $ | 18,786,306 | $ | (142,576,802 | ) | $ | 28,246,507 | |||||||||||
| Deferred share issuance costs | - | - | - | - | (623,743 | ) | (623,743 | ) | |||||||||||||||
| Fair value of expired warrants | - | - | (3,517,867 | ) | 3,517,867 | - | - | ||||||||||||||||
| Restricted share units exercised | 2,019,685 | 2,896,211 | - | (2,896,211 | ) | - | - | ||||||||||||||||
| Stock options exercised | 175,000 | 177,510 | - | - | - | 177,510 | |||||||||||||||||
| Fair value of stock options exercised | - | 99,263 | - | (99,263 | ) | - | - | ||||||||||||||||
| Share-based compensation (note 9) | - | - | - | 11,130,090 | - | 11,130,090 | |||||||||||||||||
| Performance share units exercised | 2,650,000 | 2,939,038 | - | (2,939,038 | ) | - | - | ||||||||||||||||
| Net loss and comprehensive loss for the period | - | - | - | - | (28,498,989 | ) | (28,498,989 | ) | |||||||||||||||
| Balance, September 30, 2024 | 70,196,964 | $ | 154,631,158 | $ | - | $ | 27,499,751 | $ | (171,699,534 | ) | $ | 10,431,375 |
The accompanying notes to the unaudited condensed
interim consolidated financial statements are an integral part of these consolidated financial statements.
Cardiol Therapeutics Inc.
Notes to Condensed Interim Consolidated Financial
Three and Nine Months Ended September 30,
in Canadian Dollars)
Cardiol Therapeutics Inc. was incorporated under the laws of
the Province of Ontario on January 19, 2017. The Corporation's registered and legal office is located at 2265 Upper Middle Rd. E.,
Suite 602, Oakville, Ontario, L6H 0G5, Canada.
Cardiol Therapeutics Inc. and its subsidiary (the
"Corporation" or "Cardiol") is a clinical-stage life sciences company focused on the research and clinical development
of anti-inflammatory and anti-fibrotic therapies for the treatment of heart disease. The Corporation's lead drug candidate, CardiolRx
(cannabidiol) oral solution, is pharmaceutically manufactured and in clinical development for use in the treatment of heart disease.
On December 20, 2018, the Corporation completed
its initial public offering on the Toronto Stock Exchange (the "TSX"). As a result, the Corporation's common shares commenced
trading on that date on the TSX under the symbol "CRDL". On August 10, 2021, the Corporation's common shares commenced
trading on The Nasdaq Capital Market under the symbol "CRDL".
Statement of compliance
The Corporation applies International Financial
Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") and Interpretations
issued by the International Financial Reporting Interpretations Committee ("IFRIC"). These unaudited condensed interim consolidated
financial statements have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting. Accordingly,
they do not include all of the information required for full annual financial statements required by IFRS as issued by IASB and interpretations
The policies applied in these unaudited condensed
interim consolidated financial statements are based on IFRSs issued and outstanding as of November 11, 2024, the date the Board of
Directors approved the statements. The same accounting policies and methods of computation are followed in these unaudited condensed interim
consolidated financial statements as compared with the most recent annual consolidated financial statements as at and for the year ended
Any subsequent changes to IFRS that are given
effect in the Corporation's annual consolidated financial statements for the year ending December 31, 2024, could result in
restatement of these unaudited condensed interim consolidated financial statements.
Interest earned on cash and cash equivalents for
the three and nine months ended September 30, 2024, amounted to $201,864 and $886,567 (three and nine months ended September 30,
2023 - $515,538 and $1,590,162).
Cardiol Therapeutics Inc.
Notes to Condensed Interim Consolidated
Financial Statements
Three and Nine Months Ended September
(Expressed in Canadian Dollars)
| Cost | Right-of- use asset | Equipment | Leasehold improvements | Office equipment | Computer equipment | Total | ||||||||||||||||||
| Balance, December 31, 2022 | $ | 200,319 | $ | 171,864 | $ | 237,248 | $ | 66,864 | $ | 112,290 | $ | 788,585 | ||||||||||||
| Additions | 140,919 | 47,945 | - | - | 16,367 | 205,231 | ||||||||||||||||||
| Balance, December 31, 2023 | 341,238 | 219,809 | 237,248 | $ | 66,864 | $ | 128,657 | $ | 993,816 | |||||||||||||||
| Additions | - | - | - | - | 15,131 | 15,131 | ||||||||||||||||||
| Balance, September 30, 2024 | $ | 341,238 | $ | 219,809 | $ | 237,248 | $ | 66,864 | $ | 143,788 | $ | 1,008,947 |
| Accumulated Depreciation | Right-of- use asset | Equipment | Leasehold improvements | Office equipment | Computer equipment | Total | ||||||||||||||||||
| Balance, December 31, 2022 | $ | 143,577 | $ | 94,961 | $ | 156,712 | $ | 33,728 | $ | 63,869 | $ | 492,847 | ||||||||||||
| Depreciation for the year | 53,091 | 36,761 | 50,840 | 6,627 | 16,592 | 163,911 | ||||||||||||||||||
| Balance, December 31, 2023 | $ | 196,668 | $ | 131,722 | $ | 207,552 | $ | 40,355 | $ | 80,461 | $ | 656,758 | ||||||||||||
| Depreciation for the period | 47,988 | 19,820 | 29,696 | 3,976 | 12,783 | 114,263 | ||||||||||||||||||
| Balance, September 30, 2024 | $ | 244,656 | $ | 151,542 | $ | 237,248 | $ | 44,331 | $ | 93,244 | $ | 771,021 |
| Carrying value | Right-of- use asset | Equipment | Leasehold improvements | Office equipment | Computer equipment | Total | ||||||||||||||||||
| Balance, December 31, 2023 | $ | 144,570 | $ | 88,087 | $ | 29,696 | $ | 26,509 | $ | 48,196 | $ | 337,058 | ||||||||||||
| Balance, September 30, 2024 | $ | 96,582 | $ | 68,267 | $ | - | $ | 22,533 | $ | 50,544 | $ | 237,926 |
| Cost | Exclusive global license agreement | |||
| Balance, December 31, 2022, December 31, 2023, and September 30, 2024 | $ | 767,228 |
| Accumulated Amortization | Exclusive global license agreement | |||
| Balance, December 31, 2022 | $ | 472,426 | ||
| Amortization for the year | 84,444 | |||
| Balance, December 31, 2023 | $ | 556,870 | ||
| Amortization for the period | 63,333 | |||
| Write-off | 147,025 | |||
| Balance, September 30, 2024 | $ | 767,228 |
| Carrying Value | Exclusive global license agreement | |||
| Balance, December 31, 2023 | $ | 210,358 | ||
| Balance, September 30, 2024 | $ | - |
Cardiol Therapeutics Inc.
Notes to Condensed Interim Consolidated
Financial Statements
Three and Nine Months Ended September
(Expressed in Canadian Dollars)
Exclusive global agreement ("Meros License Agreement")
In 2017, the Corporation was granted by
Meros Polymers Inc. ("Meros") the sole, exclusive, irrevocable license to patented nanotechnologies for use with any
drugs to diagnose, or treat, cardiovascular disease, cardiopulmonary disease, and cardiac arrhythmias. Meros is focused on the
advancement of nanotechnologies developed at the University of Alberta.
Under the Meros License Agreement, Cardiol agreed
to certain milestones and milestone payments, including the following: (i) payment of $100,000 upon enrolling the first patient
in a Phase IIB clinical trial designed to investigate the safety and indications of efficacy of one of the licensed technologies; (ii) payment
of $500,000 upon enrolling the first patient in a Pivotal Phase III clinical trial designed to investigate the safety and efficacy of
one of the licensed technologies; (iii) $1,000,000 upon receiving regulatory approval from the FDA for any therapeutic and/or prophylactic
treatment incorporating the licensed technologies. No milestone payments have been earned or made to date. Cardiol also agreed to pay
Meros the following royalties:
(a) 5% of worldwide proceeds of net sales
of the licensed technologies containing cannabinoids, excluding non-royalty sub-license income in (b) below, that Cardiol receives
from human and animal disease indications and derivatives as outlined in the Meros License Agreement;
(b) 7% of any non-royalty sub-license income
that Cardiol receives from human and animal disease indications and derivatives for licensed technologies containing cannabinoids as
outlined in the Meros License Agreement;
(c) 3.7% of worldwide proceeds of net sales