Assets and Liabilities Held for Sale and Discontinued Operations

6 Months Ended

12 Months Ended

Jun. 30, 2025

Dec. 31, 2024

Assets and Liabilities Held for Sale and Discontinued Operations [Abstract]

Assets and liabilities held for sale and discontinued operations

4. Assets and liabilities held for sale and discontinued operations

Pursuant to the Asset Purchase Agreement, the Company agreed to sell its skincare business for (i) 1,267,040 shares of common stock of the buyer, having a market value of $728,550 at the closing of the agreement; (ii) buyer’s assumption of certain liabilities; and, (iii) $56,525 in cash, to be paid upon the sale of specified inventory existing as of the consummation of this transaction (“Closing”).

Following the Closing, which occurred on January 16, 2025 (such date, the “Closing Date”), buyer will pay additional earn-out consideration for the sale, if and when payable: (a) buyer will pay, for each year ending on the anniversary of the Closing Date during the five-year period following the Closing, an amount, if any, equal to 5% of the sales generated during such year from the existing products as of the Closing; and (b) buyer will pay a one-time payment of $500,000 if buyer achieves $500,000 in revenue from sales of the existing hair and scalp products as of the Closing on or before the 24-month anniversary of the Closing Date.

The following table summarizes the major line items for the skincare business that are included in loss from discontinued operations, net of taxes in the consolidated statements of operations:

	Three months ended June 30, 2025		Three months ended June 30, 2024			Six months ended June 30, 2025			Six months ended June 30, 2024
Revenue	$	-	$	605,530		$	152,381		$	1,220,093
Cost of goods sold		-		166,274			30,530			335,185
Gross profit	$	-	$	439,256		$	121,851		$	884,908
Expenses
Depreciation		-		2,570			517			4,818
Marketing and promotion		-		587,893			6,924			849,415
Consulting fees		-		5,600			-			23,253
Office and administrative		7,661		515,619			54,875			1,261,767
Professional fees		-		109,436			50,460			246,068
Investor relations		-		390						7,057
Research and development		-		17,561			16,921			117,973
Foreign exchange (gain) loss		-		53			1,875			(1,198	)
Travel and entertainment		-		52,505			10,726			111,613
Total expenses	$	7,661	$	1,291,627		$	142,298		$	2,620,766
Other income (expense)
Other income		24,796		-			49,614			34,723
Interest expense		-		(7,209	)		-			(11,574	)
Loss on the sale of Skincare		-		-			(39,676	)		-
Net income (loss) from discontinued operations	$	17,135	$	(859,580	)	$	(10,509	)	$	(1,712,709	)

The following table summarizes the carrying amounts of major classes of assets and liabilities of discontinued operations as at the Closing Date (January 16, 2025) and December 31, 2024:

	Closing Date January 16, 2025		December 31, 2024
Assets
Receivables, net		71,793		43,497
Inventory		875,996		898,962
Prepaid expenses and deposits		94,568		137,875
Property and equipment		47,618		48,134
Right of use asset		51,721		64,340
Total assets held for sale		1,141,696		1,192,808
Liabilities
Accounts payable and accrued liabilities		307,024		449,125
Customer deposits		13,806		34,302
Lease liability		52,640		65,489
Total liabilities held for sale		373,470		548,916
Total assets and liabilities held for sale, net		768,226		643,892

The Company recorded a loss on sale of discontinued operations of $39,676. The proceeds on sale, which was the fair value of the buyer shares received on Closing, amounted to $728,550, and the carrying amounts of the net assets and liabilities sold amounted to $768,226.

The following represents the cash flows from operating and investing activities of discontinued operations for the six months ended June 30, 2025 and 2024:

	June 30, 2025			June 30, 2024
Cashflows used in operating activities	$	(174,767	)	$	(1,912,907	)
Cashflows used in investing activities		-			(9,160	)

4. Assets and liabilities held for sale and Discontinued operations

Pursuant to the Asset Purchase Agreement, the Company agreed to sell its skincare business for (i) shares of common stock of the buyer, having a market value of $1,075,463 at the time of entering into the agreement; (ii) buyer’s assumption of certain liabilities; and, (iii) $56,525 in cash.

Following the closing which occurred on January 15, 2025 (the “Closing” or “Closing Date”), buyer will pay additional earn-out consideration for the sale, if and when payable: (a) buyer will pay, for each year ending on the anniversary of the Closing Date during the five-year period following the Closing, an amount, if any, equal to 5% of the sales generated during such year from the existing products as of the Closing; and (b) buyer will pay a one-time payment of $500,000 if buyer achieves $500,000 in revenue from sales of the existing hair and scalp products as of the Closing on or before the 24-month anniversary of the Closing Date.

The following table summarizes the major line items for the skincare business that are included in loss from discontinued operations, net of taxes in the consolidated statements of operations:

	December 31, 2024			December 31, 2023
Revenue	$	2,467,298		$	1,712,595
Cost of goods sold		670,197			578,015
Gross profit	$	1,797,101		$	1,134,580
Expenses
Depreciation		10,390			9,741
Marketing and promotion		1,023,200			403,841
Consulting fees		40,110			179,731
Office and administrative		2,051,571			1,981,414
Professional fees		415,878			446,511
Investor relations		6,667			-
Research and development		308,597			418,833
Foreign exchange (gain) loss		(1,972	)		-
Travel and entertainment		186,244			319,762
Total expenses	$	4,040,685			3,759,833
Other income		(34,723	)		-
Interest expense		20,162			19,525
Loss from discontinued operations	$	2,229,023			2,644,778

The following table summarizes the carrying amounts of major classes of assets and liabilities of discontinued operations as at December 31, 2024 and 2023:

	December 31, 2024		December 31, 2023
Assets
Receivables, net		43,497		33,089
Inventory		898,962		495,667
Prepaid expenses and deposits		137,875		158,712
Property and equipment		48,134		-
Right of use asset		64,340		-
Total current assets held for sale		1,192,808		687,468
Deposit				10,773
Property and equipment		-		51,378
Right of use asset		-		206,582
Total assets held for sale		1,192,808		956,201
Liabilities
Accounts payable and accrued liabilities		449,125		535,361
Customer deposits		34,302		36,693
Lease liability		65,489		145,000
Total current liabilities held for sale		548,916		717,054
Lease liability		-		65,489
Total liabilities held for sale		548,916		782,543
Total assets and liabilities held for sale, net		643,892		173,658

As the estimated proceeds on sale exceed the net assets and liabilities held for sale, there is no write down to net realizable value required as at December 31, 2024.

The following represents the cash flows from operating and investing activities of discontinued operations for the years ended December 31, 2024 and 2023:

	December 31, 2024			December 31, 2023
Cashflows used in operating activities	$	(2,686,379	)	$	(2,441,940	)
Cashflows used in investing activities		(9,160	)		(11,191	)