PMGC Holdings Inc.

Previous wording

You should read the following discussion and analysis of our financial condition and results of operations together with our unaudited condensed consolidated financial statements and the notes to those statements included elsewhere in this Quarterly Report and the audited consolidated financial statements and the other information set forth in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission on March 29, 2024.

Current wording

You should read the following discussion and analysis of our financial condition and results of operations together with our unaudited condensed consolidated financial statements and the notes to those statements included elsewhere in this Quarterly Report and the audited consolidated financial statements and the other information set forth in our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the U.S. Securities and Exchange Commission on March 28, 2025.

Previous wording

This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Exchange Act that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Quarterly Report including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of the Company’s registration statement on Form S-1 filed with the U.S. Securities and Exchange Commission (the “SEC”). The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website atwww.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

Current wording

This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”) that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Quarterly Report including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of the Company’s registration statement on Form S-1 filed with the U.S. Securities and Exchange Commission (the “SEC”). The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website atwww.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

Previous wording

Elevai Labs Inc. manages and operates a diverse portfolio of three wholly owned subsidiaries across the medical aesthetics and biopharmaceutical sectors:

Current wording

Prior to entering into the Asset Purchase Agreement, the Company’s principal business was operating a skincare development company engaged in the design, manufacture, and marketing of skincare products in the skincare industry. After the sale of the skincare business, the Company changed its principal business. PMGC Holdings Inc. is a diversified holding company that manages and grows its portfolio through strategic acquisitions, investments, and development across various industries. The Company currently manages and operates a diverse portfolio of three wholly owned subsidiaries:

Previous wording

Comparison of the nine months ended September 30, 2024.

Current wording

Comparison of the three months ended March 31, 2025.

Previous wording

The following table provides certain selected financial information for the periods presented:

Current wording

In January 2025, the Company sold its skincare business, which had previously contributed to the financial results of the Company. The financial results of the disposed operations from January 1, 2025 until January 16, 2025 have been classified as discontinued operations. The following table provides certain selected financial information for continuing operations for the periods presented and does not include activity from the skincare business of the Company:

Previous wording

Professional fees for the three months ended September 30, 2024, were $249,889, compared to $143,654 for the three months ended September 30, 2023, an increase of $106,234. Professional fees were comprised of legal, audit and accounting services. The increase during the three months ended September 30, 2024 is primarily due to an increase in audit, legal and accounting services as the company is now listed on the Nasdaq.

Current wording

Professional fees for the three months ended March 31, 2025 were $266,468, compared to $43,290 for the three months ended March 31, 2024, an increase of $223,178. Professional fees comprise of legal, audit and accounting services. The increase during 2025 is primarily due to an increase in audit, legal and accounting services given the corporate restructuring and financing efforts conducted during the first three months of 2025 compared to 2024.

Previous wording

The accompanying consolidated financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The continuation of the Company as a going concern is dependent upon the continued financial support from its shareholders, the ability of the Company to obtain necessary equity financing to continue operations, and ultimately the attainment of profitable operations.

Current wording

The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The continuation of the Company as a going concern is dependent upon the continued financial support from its shareholders, the ability of the Company to obtain necessary equity financing to continue operations, and ultimately the attainment of profitable operations.

Previous wording

As of September 30, 2024, and December 31, 2023, the Company had a net working capital of $6,097,404 and $3,622,091, respectively, and has an accumulated deficit of $11,334,888 and $7,023,890, respectively. Furthermore, for the nine months ended September 30, 2024, and 2023, the Company incurred a net loss of $4,310,998 and $3,143,601, respectively and used $3,486,435 and $2,168,661, respectively of cash flows for operating activities. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Current wording

As of March 31, 2025, we had cash of $5,364,434 and as of December 31, 2024, we had cash of $3,984,453. The increase between December 31, 2024 and March 31, 2025 was attributable to cash provided by financing activities exceeding cash used in operating and investing activities. As of March 31, 2025 and December 31, 2024, the Company had a net working capital of $6,055,880 and $4,251,867, respectively, and has an accumulated deficit of $14,878,082 and $13,269,627, respectively. Furthermore, for the three months ended March 31, 2025, and 2024, the Company incurred a net loss of $1,608,455 and $1,397,250, respectively and used $1,347,416 and $2,324,068, respectively of cash flows for operating activities. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. The accompanying condensed consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company believes it will have sufficient funds for at least the next 12 months from the issuance date of the unaudited condensed consolidated financial statements.

Previous wording

Our principal liquidity requirements are for working capital, capital expenditure, research and development and inventory production. We fund our liquidity requirements primarily through cash on hand, cash flows from operations, the issuance of common, warrants and preferred stock, and the issuance of notes. As of September 30, 2024, we had cash of $6,425,670, with $3,326,851 as of December 31, 2023.

Current wording

Our principal liquidity requirements are for working capital, capital expenditure and research and development. We fund our liquidity requirements primarily through cash on hand and the issuance of common and preferred stock.

Previous wording

The following table provides selected financial data as of September 30, 2024, and December 31, 2023, respectively.

Current wording

The following table provides selected financial data as of March 31, 2025, and December 31, 2024, respectively (excluding assets and liabilities held for sale).

Previous wording

The following table summarizes our cash flows from operating, investing and financing activities:

Current wording

The following table summarizes our cash flows from operating, investing and financing activities from continuing operations:

Previous wording

For the nine months ended September 30, 2024, net cash flows used in operating activities was $3,486,435 compared to $2,168,661 used during the nine months ended September 30, 2024, respectively, primarily due to net loss and timing of settlement of assets and liabilities.

Current wording

For the three months ended March 31, 2025, net cash flows used in operating activities was $1,155,514 compared to $889,600 used during the three months ended March 31, 2024, respectively, primarily due to net loss and timing of settlement of assets and liabilities.

Previous wording

During the nine months ended September 30, 2024, we had net cash flow provided by financing activities of $6,757,501 compared to cash flow provided by financing activities of $1,501,086 in the nine months ended September 30, 2023. During the nine months ended September 30, 2024, and 2023, the Company raised $6,993,059 and $1,463,586, respectively, through the issuance of common stock and common stock purchase warrants; $914,442 and $Nil, respectively, through the issuance of notes; and $Nil and $37,500, respectively, upon the exercise of stock options in exchange for common stock. The cash provided by financing activities during the nine months ended September 30, 2024, was partially offset by the repayment of notes of $1,150,000.

Current wording

During the three months ended March 31, 2025, we had cash flow provided by financing activities of $2,943,185 compared to cash flow provided by financing activities of $Nil in the three months ended March 31, 2024. During the three months ended March 31, 2025, the Company raised $1,245,306 through the issuance of common stock and prefunded warrants, and $1,698,058 through the exercise of Series A warrants.

Previous wording

This discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to revenue recognition, the collectability of receivables, valuation of inventory, fair value of derivative liabilities and stock options, useful lives and recoverability of long-lived assets, and deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgements about the carrying value of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from those estimates. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the consolidated financial statements in the period they are determined.

Current wording

This discussion and analysis of our financial condition and results of operations is based on our condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to revenue recognition, the collectability of receivables, valuation of inventory, fair value of investments in securities, derivative liabilities and stock options, useful lives and recoverability of long-lived assets, and deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgements about the carrying value of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from those estimates. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the consolidated financial statements in the period they are determined.

Previous wording

The Company’s policy for property and equipment requires judgement in determining whether the present value of future expected economic benefits exceeds capitalized costs. The policy requires management to make certain estimates and assumptions about future economic benefits related to its operations. Estimates and assumptions may change if new information becomes available. If information becomes available suggesting that the recovery of capitalized cost is unlikely, the capitalized cost is written off/impaired to the consolidated statement of operations.

Current wording

The Company’s policy for intangible assets require judgement in determining whether the present value of future expected economic benefits exceeds capitalized costs. The policy requires management to make certain estimates and assumptions about future economic benefits related to its operations. Estimates and assumptions may change if new information becomes available. If information becomes available suggesting that the recovery of capitalized cost is unlikely, the capitalized cost is written off/impaired to the consolidated statement of operations.

Previous wording

The Company’s functional and reporting currency is the U.S. dollar. The functional currency of the Company’s Canadian subsidiary, Elevai Research Inc. (“Elevai Research”) is the Canadian dollar. Monetary assets and liabilities denominated in foreign currencies are translated using the exchange rate prevailing at the balance sheet date. Non-monetary assets, liabilities, and items recorded in income arising from transactions denominated in foreign currencies are translated at rates of exchange in effect at the date of the transaction. Gains and losses arising on translation or settlement of foreign currency denominated transactions or balances are included in the determination of income.

Current wording

The Company’s functional and reporting currency is the U.S. dollar. The functional currency of the Company’s Canadian subsidiary, PMGC Research Inc. (“PMGC Research”), is the Canadian dollar. Monetary assets and liabilities denominated in foreign currencies are translated using the exchange rate prevailing at the balance sheet date. Non-monetary assets, liabilities, and items recorded in income arising from transactions denominated in foreign currencies are translated at rates of exchange in effect at the date of the transaction. Gains and losses arising on translation or settlement of foreign currency denominated transactions or balances are included in the determination of income.

Previous wording

The accounts of Elevai Research are translated to U.S. dollars using the current rate method. Accordingly, assets and liabilities are translated into U.S. dollars at the period-end exchange rate while revenues and expenses are translated at the average exchange rates during the period. Related exchange gains and losses are included in a separate component of stockholders’ equity as accumulated other comprehensive income (loss).

Current wording

The accounts of PMGC Research are translated to U.S. dollars using the current rate method. Accordingly, assets and liabilities are translated into U.S. dollars at the period-end exchange rate while revenues and expenses are translated at the average exchange rates during the period. Related exchange gains and losses are included in a separate component of stockholders’ equity as accumulated other comprehensive income (loss).

Previous wording

Non-employees - During June 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2018-07, Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”) to simplify the accounting for share-based payments to nonemployees by aligning it with the accounting for share-based payments to employees. Under the requirements of ASU 2018-07, the Company accounts for share-based compensation to non-employees under the fair value method which requires all such compensation to be calculated based on the fair value at the measurement date (generally the grant date) and recognized in the statement of operations over the requisite service period.

Current wording

Nonemployees - During June 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2018-07, Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”) to simplify the accounting for share-based payments to nonemployees by aligning it with the accounting for share-based payments to employees. Under the requirements of ASU 2018-07, the Company accounts for share-based compensation to non-employees under the fair value method which requires all such compensation to be calculated based on the fair value at the measurement date (generally the grant date) and recognized in the statement of operations over the requisite service period.

Previous wording

During the nine months ended September 30, 2024, and 2023, the Company recorded $57,521 and $346,548, respectively, in share-based compensation expense, of which $53,977 and $337,550, and $3,544 and $8,998, respectively is included in office and administration and research and development, respectively.

Current wording

During the three months ended March 31, 2025 and 2024, the Company recorded ($58,838) and $55,339, respectively, in share-based compensation expense, of which $20,762 and ($79,600), and $5,029 and $50,310, respectively is included in office and administration and discontinued operations, respectively. Within discontinued operations for the years ended March 31, 2025 and 2024, ($73,768) and ($5,832), and $48,900 and $1,410, respectively is included in office and administration and research and development, respectively.

Previous wording

Determining the appropriate fair value model and the related assumptions requires judgment. During the nine months ended September 30, 2024, and year ended December 31, 2023, the fair value of each option grant was estimated using a Black-Scholes option-pricing model.

Current wording

Determining the appropriate fair value model and the related assumptions requires judgment. During the three months ended March 31, 2025 and the year ended 2024, the fair value of each option grant was estimated using a Black-Scholes option-pricing model.

Previous wording

Market risk is the risk of loss arising from adverse changes in market rates and prices. Our market risk exposure is generally limited to those risks that arise in the normal course of business, as we do not engage in speculative, non-operating transactions, nor do we utilize financial instruments or derivative instruments for trading purposes.

Current wording

Market risk is the risk of loss arising from adverse changes in market rates and prices. Our market risk exposure is generally limited to those risks that arise in the normal course of business, as we do not engage in speculative, non-operating transactions, nor do we utilize financial instruments.