EX-99.1 2 tm2514795d1_ex99-1.htm EXHIBIT 99.1

 

Exhibit 99.1

 

 

 

 

 

CARDIOL THERAPEUTICS INC.

CONDENSED INTERIM CONSOLIDATED
FINANCIAL STATEMENTS

THREE MONTHS ENDED MARCH 31, 2025
(EXPRESSED IN CANADIAN DOLLARS)
(UNAUDITED)

 

 

 

 

 

Cardiol Therapeutics Inc.
Condensed Interim Consolidated Statements of Financial Position
(Expressed in Canadian Dollars)
Unaudited

 

    As at
March 31,
2025		     As at December 31, 2024  
ASSETS                
                 
Current assets                
Cash and cash equivalents (note 3)   $ 23,292,701     $ 30,580,029  
Accounts receivable     75,960       100,366  
Other receivables     270,730       261,255  
Prepaid expenses     1,632,959       726,509  
Total current assets     25,272,350       31,668,159  
                 
Non-current assets                
Property and equipment (note 4)     182,545       195,592  
Total assets   $ 25,454,895     $ 31,863,751  
                 
EQUITY AND LIABILITIES                
                 
Current liabilities                
Accounts payable and accrued liabilities (note 13)   $ 7,716,431     $ 6,976,736  
Current portion of lease liability (note 5)     34,252       33,009  
Total current liabilities     7,750,683       7,009,745  
                 
Non-current liabilities                
Lease liability (note 5)     116,408       125,523  
Total liabilities     7,867,091       7,135,268  
                 
Equity                
Share capital (note 7)     179,335,421       179,335,421  
Contributed surplus     25,794,137       24,647,163  
Deficit     (187,541,754 )     (179,254,101 )
Total equity     17,587,804       24,728,483  
Total equity and liabilities   $ 25,454,895     $ 31,863,751  

 

The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements.

 

Commitments (note 11)
Subsequent events (note 8)

 

Approved on behalf of the Board:

 

"David Elsley", Director   "Guillermo Torre-Amione", Director

 

- 1 -

 

 

Cardiol Therapeutics Inc.
Condensed Interim Consolidated Statements of Loss and Comprehensive Loss
(Expressed in Canadian Dollars)
Unaudited

 

   Three Months   Three Months 
   Ended   Ended 
   March 31,   March 31, 
   2025   2024 
Operating expenses (notes 8, 12, 13)          
General and administration (note 12)  $4,671,651   $5,082,552 
Research and development (note 12)   3,757,412    3,322,929 
Loss before other income (expenses)   (8,429,063)   (8,405,481)
Interest income (note 3)   248,269    377,294 
Gain (loss) on foreign exchange   (106,859)   628,935 
Change in derivative liability (note 6)   -    (1,808,603)
Other income   -    28,223 
Net loss and comprehensive loss for the period  $(8,287,653)  $(9,179,632)
           
Basic and diluted net loss per share (note 10)  $(0.10)  $(0.14)
Weighted average number of common shares outstanding   82,608,992    67,259,344 

 

The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements.

 

- 2 -

 

 

Cardiol Therapeutics Inc.
Condensed Interim Consolidated Statements of Cash Flows
(Expressed in Canadian Dollars)
Unaudited

 

   Three Months   Three Months 
   Ended   Ended 
   March 31,   March 31, 
   2025   2024 
Operating activities          
Net loss and comprehensive loss for the period  $(8,287,653)  $(9,179,632)
Adjustments for:          
Depreciation of property and equipment   24,986    40,512 
Amortization of intangible assets   -    21,111 
Share-based compensation (note 8)   1,146,974    902,100 
Change in derivative liability   -    1,808,603 
Unrealized foreign exchange (gain)/loss on cash   107,778    (491,097)
Accretion on lease liability   5,972    6,640 
Changes in non-cash working capital items:           
Accounts receivable   24,406    (11,230)
Other receivables   (9,475)   (26,004)
Prepaid expenses   (906,450)   (805,504)
Accounts payable and accrued liabilities   739,695    811,708 
Net cash used in operating activities   (7,153,767)   (6,922,793)
           
Investing activities          
Purchase of property and equipment   (11,939)   (3,460)
Net cash used in investing activities   (11,939)   (3,460)
           
Financing activities          
Proceeds from stock options exercised   -    90,197 
Payment of lease liability   (13,844)   (13,844)
Net cash provided by (used in) financing activities   (13,844)   76,353 
Net change in cash and cash equivalents   (7,179,550)   (6,849,900)
Cash and cash equivalents, beginning of period   30,580,029    34,931,778 
Impact of foreign exchange on cash and cash equivalents   (107,778)   491,097 
Cash and cash equivalents, end of period  $23,292,701   $28,572,975 

 

The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements.

 

- 3 -

 

 

Cardiol Therapeutics Inc.
Condensed Interim Consolidated Statements of Changes in Equity
(Expressed in Canadian Dollars)
Unaudited

 

   Share capital       Contributed         
   Number   Amount   Warrants   surplus   Deficit   Total 
Balance, December  31, 2023   65,352,279   $148,519,136   $3,517,867   $18,786,306   $(142,576,802)  $28,246,507 
Restricted share units exercised   1,531,429    1,830,736    -    (1,830,736)   -    - 
Stock options exercised   100,000    90,197    -    -    -    90,197 
Fair value of stock options exercised   -    46,905    -    (46,905)   -    - 
Share-based compensation (note 8)   -    -    -    902,100    -    902,100 
Performance share units exercised   1,300,000    604,582    -    (604,582)   -    - 
Net loss and comprehensive loss for the period   -    -    -    -    (9,179,632)   (9,179,632)
Balance, March 31, 2024   68,283,708   $151,091,556   $3,517,867   $17,206,183   $(151,756,434)  $20,059,172 
                               
Balance, December 31, 2024   82,608,992   $179,335,421   $-   $24,647,163   $(179,254,101)  $24,728,483 
Share-based compensation (note 8)   -    -    -    1,146,974    -    1,146,974 
Net loss and comprehensive loss for the period   -    -    -    -    (8,287,653)   (8,287,653)
Balance, March 31, 2025   82,608,992   $179,335,421   $-   $25,794,137   $(187,541,754)  $17,587,804 

 

The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements.

 

- 4 -

 

 

Cardiol Therapeutics Inc.
Notes to Condensed Interim Consolidated Financial Statements
Three Months Ended March 31, 2025
(Expressed in Canadian Dollars)
Unaudited

 

1.Nature of operations

 

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 developing anti-inflammatory and anti-fibrotic therapies for the treatment of heart disease. The Corporation's lead small molecule 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".

 

2.Material accounting policy information

 

Statement of compliance

 

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 International Financial Reporting Standards and International Accounting Standards as issued by the International Accounting Standards Board (IASB) and Interpretations (collectively “IFRS Accounting Standards”).

 

These unaudited condensed interim consolidated financial statements have been prepared on a historical cost basis. In addition, these unaudited condensed interim consolidated financial statements have been prepared using the accrual basis of accounting except for cash flow information.

 

The policies applied in these unaudited condensed interim consolidated financial statements are based on IFRS Accounting Standards issued and outstanding as of May 14, 2025, 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 December 31, 2024.

 

Any subsequent changes to IFRS Accounting Standards that are given effect in the Corporation’s annual consolidated financial statements for the year ending December 31, 2025, could result in restatement of these unaudited condensed interim consolidated financial statements.

 

3.Cash and cash equivalents

 

Interest earned on cash and cash equivalents for the three months ended March 31, 2025, amounted to $248,269 (three months ended March 31, 2024 - $377,294).

 

- 5 -

 

 

Cardiol Therapeutics Inc.
Notes to Condensed Interim Consolidated Financial Statements
Three Months Ended March 31, 2025
(Expressed in Canadian Dollars)
Unaudited

 

4.Property and equipment

 

Cost   Right-of-
use asset		   Equipment   Leasehold
improvements		   Office
equipment		   Computer
equipment		   Total 
Balance, December 31, 2023   $341,238   $219,809   $237,248   $66,864   $128,657   $993,816 
Additions    -    -    -    -    21,290    21,290 
Disposals    -    (46,855)   -    -    -    (46,855)
Balance, December 31, 2024    341,238    172,954    237,248   $66,864   $149,947   $968,251 
Additions    -    -    -    -    11,939    11,939 
Balance, March 31, 2025   $341,238   $172,954   $237,248   $66,864   $161,886   $980,190 

 

Accumulated Depreciation     Right-of-
use asset		     Equipment     Leasehold
improvements		     Office
equipment		     Computer
equipment		     Total  
Balance, December 31, 2023   $ 196,668     $ 131,722     $ 207,552     $ 40,355     $ 80,461     $ 656,758    
Depreciation for the year     63,984       26,426       29,696       5,302       17,994       143,402    
Disposals     -       (27,501 )     -       -       -       (27,501 )  
Balance, December 31, 2024   $ 260,652     $ 130,647     $ 237,248     $ 45,657     $ 98,455     $ 772,659    
Depreciation for the period     15,996       3,173       -       1,060       4,757       24,986    
Balance, March 31, 2025   $ 276,648     $ 133,820     $ 237,248     $ 46,717     $ 103,212     $ 797,645    

 

Carrying value     Right-of-
use asset		     Equipment     Leasehold
improvements		     Office
equipment		     Computer
equipment		     Total  
Balance, December 31, 2024   $80,586   $42,307   $-   $21,207   $51,492   $195,592 
Balance, March 31, 2025   $64,590   $39,134   $-   $20,147   $58,674   $182,545 

 

5.Lease liability

 

   Carrying 
   Value 
Balance, December 31, 2023  $174,340 
Repayments   (41,532)
Accretion   25,724 
Balance, December 31, 2024  $158,532 
Repayments   (13,844)
Accretion   5,972 
Balance, March 31, 2025  $150,660 
Current portion   34,252 
Long-term portion  $116,408 

 

(i) When measuring the lease liability for the property lease that was classified as an operating lease, the Corporation discounted the lease payments using its incremental borrowing rate. The original property lease had an expiration date of May 31, 2024, and the lease payments were discounted with a 9% interest rate. During the year ended December 31, 2023, the property lease was extended to October 30, 2028. The lease liability was revalued as of the extension date with lease payments discounted with a 15% interest rate.

 

- 6 -

 

 

Cardiol Therapeutics Inc.
Notes to Condensed Interim Consolidated Financial Statements
Three Months Ended March 31, 2025
(Expressed in Canadian Dollars)
Unaudited

 

6.Derivative liability

 

On November 5, 2021, the Corporation issued 8,175,000 warrants as part of a unit financing. Each warrant was exercisable into one common share at the price of USD$3.75 per share for a period of three years from closing. The warrants were classified as a derivative liability on the statement of financial position and re-valued at each reporting date, as the warrants were issued in a currency other than the Corporation's functional currency. During the three months ended March 31, 2024, the value of the derivative liability increased $1,808,603. During 2024, all 8,175,000 warrants expired unexercised.

 

7.Share capital

 

a) Authorized share capital

 

The authorized share capital consists of an unlimited number of common shares. The common shares do not have a par value. All issued shares are fully paid.

 

b) Common shares issued

 

   Number of     
   common
shares		   Amount 
Balance, December 31, 2023   65,352,279   $148,519,136 
Restricted share units exercised (note 8)   1,531,429    1,830,736 
Fair value of stock options exercised (note 8)   -    46,905 
Stock options exercised (note 9)   100,000    90,197 
Performance share units exercised (note 8)   1,300,000    604,582 
Balance, March 31, 2024   68,283,708   $151,091,556 
Balance, December 31, 2024 and March 31, 2025   82,608,992   $179,335,421 

 

8.Share-based payments

 

The Corporation has adopted an Omnibus Equity Incentive Plan in accordance with the policies of the TSX, which permits the grant or issuance of options, Restricted Share Units ("RSUs"), Performance Share Units ("PSUs"), and Deferred Share Units ("DSUs"), as well as other share-based payment arrangements. The maximum number of shares that may be issued upon the exercise or settlement of awards granted under the plan may not exceed 15% of the Corporation's issued and outstanding shares from time to time. The Board of Directors determines the price per common share and the number of common shares which may be allotted to directors, officers, employees, and consultants, and all other terms and conditions of the option, subject to the rules of the TSX.

 

During the three months ended March 31, 2025, the total expenses related to share-based compensation amounted to $1,146,974 (three months ended March 31, 2024 - $902,100). All outstanding awards are settleable with common shares and not cash.

 

- 7 -

 

 

Cardiol Therapeutics Inc.
Notes to Condensed Interim Consolidated Financial Statements
Three Months Ended March 31, 2025
(Expressed in Canadian Dollars)
Unaudited

 

8.Share-based payments (continued)

 

(a) Stock Options

 

    Number of     Weighted average  
    stock options     exercise price ($)  
Balance, December 31, 2023     1,732,500     $ 2.44  
Issued     455,000       2.56  
Expired     (110,000 )     1.36  
Exercised (i)     (100,000 )     1.92  
Balance, March 31, 2024     1,977,500     $ 2.61  
                 
Balance, December 31, 2024     1,487,500     $ 2.76  
Issued     1,200,000       1.63  
Expired     (170,000 )     2.68  
Balance, March 31, 2025     2,517,500     $ 2.22  

 

(i) The weighted average share price on date of exercise was $2.22.    

 

At the grant date, the fair value of stock options issued was estimated using the Black-Scholes option pricing model based on the following weighted average assumptions:

 

   Three Months
Ended
March 31,
2025		   Three Months
Ended
March 31,
2024		 
Fair value of stock options at grant date  $0.65   $1.89 
Share price  $1.68   $2.83 
Exercise price  $1.63   $2.56 
Risk-free interest rate   2.53%   3.83%
Expected volatility   73%   93%
Expected life in years   2.00    3.13 
Expected dividend yield   Nil    Nil 

 

- 8 -

 

 

Cardiol Therapeutics Inc.
Notes to Condensed Interim Consolidated Financial Statements
Three Months Ended March 31, 2025
(Expressed in Canadian Dollars)
Unaudited

 

8.Share-based payments (continued)

 

(a) Stock Options (continued)

 

The following table reflects the actual stock options issued and outstanding as of March 31, 2025:

 

Expiry date   Exercise
price ($)		     Weighted average
remaining
contractual
 life (years)		     Number of
options
outstanding		     Number of
options
 vested
(exercisable)		  
May 31, 2025     1.43       0.17       25,000       25,000  
August 19, 2025     2.12       0.39       100,000       100,000  
August 30, 2025     5.00       0.42       80,000       80,000  
April 1, 2026     5.77       1.00       60,000       60,000  
December 8, 2026     3.59       1.69       325,000       325,000  
January 11, 2027     2.18       1.78       220,000       220,000  
March 1, 2027     2.56       1.92       200,000       200,000  
March 9, 2027     1.62       1.94       1,200,000       -  
May 12, 2027     1.46       2.12       70,000       46,667  
September 12, 2027     1.61       2.45       207,500       138,334  
July 7, 2029     2.07       4.27       30,000       -  
      2.22       1.82       2,517,500       1,195,001  

 

(b) Performance Share Units

 

   Number of
PSUs		 
Balance, December 31, 2023   2,000,000 
Redeemed (i)   (1,300,000)
Balance, March 31, 2024   700,000 
Balance, December 31, 2024 and March 31, 2025   - 

 

(i)The weighted average share price on date of redemption was $1.54.

 

(ii)Subsequent to March 31, 2025, 74,000 PSUs were granted.

 

- 9 -

 

 

Cardiol Therapeutics Inc.
Notes to Condensed Interim Consolidated Financial Statements
Three Months Ended March 31, 2025
(Expressed in Canadian Dollars)
Unaudited

 

8.Share-based payments (continued)

 

(c) Restricted Share Units

 

   Number of
RSUs		 
Balance, December 31, 2023   3,544,887 
Redeemed (i)   (1,531,429)
Balance, March 31, 2024   2,013,458 
      
Balance, December 31, 2024 and March 31, 2025   4,852,299 

 

(i) The weighted average share price on date of redemption was $1.53.

 

The following table reflects the actual RSUs issued and outstanding as of March 31, 2025:

 

Expiry date   Weighted average
remaining
contractual
life (years)		   Number of
RSUs
outstanding		   Number of
RSUs
vested
(exercisable)		 
July 31, 2025    0.33    1,496,335    1,363,001 
October 31, 2025    0.59    34,214    34,214 
July 10, 2027    2.28    3,321,750    760,500 
     1.67    4,852,299    2,157,715 

 

9.Warrants

 

    Number of
warrants		   Amount 
Balance, December 31, 2023 and March 31, 2024    11,628,178   $3,517,867 
Balance, December 31, 2024 and March 31, 2025    -   $- 

 

10.Loss per share

 

For the three months ended March 31, 2025, basic and diluted loss per share has been calculated based on the loss attributable to common shareholders of $8,287,653 (three months ended March 31, 2024 - $9,179,632) and the weighted average number of common shares outstanding of 82,608,992 (three months ended March 31, 2024 - 67,259,344). Diluted loss per share did not include the effect of stock options, PSUs, RSUs, and warrants as they are anti-dilutive.

 

- 10 -

 

 

Cardiol Therapeutics Inc.
Notes to Condensed Interim Consolidated Financial Statements
Three Months Ended March 31, 2025
(Expressed in Canadian Dollars)
Unaudited

 

11.Commitments

 

(i)            The Corporation has leased premises with third parties. The minimum committed lease payments, which include the lease liability payments shown as base rent, are approximately as follows:

 

    Base rent   Variable rent   Total 
2025   $41,532   $38,884   $80,416 
2026    55,376    51,846    107,222 
2027    55,376    51,846    107,222 
2028    46,146    43,205    89,351 
    $198,430   $185,781   $384,211 

 

(ii)    The Corporation has signed various agreements with consultants to provide services. Under the agreements, the Corporation has the following remaining commitments.

 

2025   $197,969 
Total   $197,969 

 

(iii)    Pursuant to the terms of agreements with various other contract research organizations, the Corporation is committed for the following contract research services:

 

2025   $1,570,418 
2026    44,306 
2027    23,085 
2028    25,254 
Total   $1,663,063 

 

12.Other expenses

 

The following details highlight certain components of the research and development and general and administration expenses classified by nature. Remaining research and development and operating expenses include personnel costs and expenses paid to third parties:

 

   Three Months
Ended		   Three Months
Ended		 
   March 31,
2025		   March 31,
2024		 
General and administration expenses          
Depreciation of property and equipment  $24,986   $40,512 
Amortization of intangible assets  $-   $21,111 
Non-cash share-based compensation  $838,346   $848,756 
           
Research and development expenses          
Non-cash share-based compensation  $308,628   $53,344 

 

- 11 -

 

 

Cardiol Therapeutics Inc.
Notes to Condensed Interim Consolidated Financial Statements
Three Months Ended March 31, 2025
(Expressed in Canadian Dollars)
Unaudited

 

13.Related party transactions

 

Key management personnel are those persons having authority and responsibility for planning, directing, and controlling the activities of the Corporation directly or indirectly, and include any directors (executive and non-executive) of the Corporation. Remuneration of directors and key management personnel of the Corporation was as follows:

 

    Three Months
Ended		     Three Months Ended  
    March 31,
2025		     March 31,
2024		  
Salaries and benefits   $ 1,305,013     $ 1,264,404  
Share-based payments     468,960       121,440  
    $ 1,773,973     $ 1,385,844  

 

As at March 31, 2025, $18,518 (December 31, 2024 - $nil) was owed to key management personnel.

 

- 12 -