NovelStem International Corp. Reports $2.55M Net Income for Six Months Ended June 30, 2025

NovelStem International Corp. reported a significant turnaround in its financial performance for the six months ended June 30, 2025, achieving a net income of approximately $2.55 million, compared to a net loss of $605,905 for the same period in 2024. This improvement was driven by a combination of factors, including a substantial gain on the disposal of its equity method investment in NetCo and relief of indebtedness income. The company’s administrative fee income, however, dropped to zero from $6,000 in the prior year, reflecting a strategic shift in its operations.

The company’s total operating expenses decreased to $158,537 for the first half of 2025, down from $327,336 in the same period of 2024. This reduction was primarily attributed to lower general and administrative expenses, which fell by approximately $168,799. The decrease in expenses was largely due to reduced legal and audit fees associated with NewStem, as well as a decline in insurance and stock-based compensation costs. Interest expenses also decreased, contributing to the overall improvement in profitability.

In terms of strategic developments, NovelStem completed the sale of its 50% interest in NetCo for $1.3 million in May 2025, which allowed the company to settle a significant litigation funding liability. This transaction was pivotal in reducing total liabilities from $5.3 million at the end of 2024 to approximately $1.99 million by June 30, 2025. The company also reported a full impairment of its investment in NewStem, which is currently in liquidation, reflecting the challenges faced in monetizing its technology assets.

Operationally, NovelStem's current assets decreased to $15,292 as of June 30, 2025, down from $31,871 at the end of 2024. The company’s cash reserves also fell to $1,106, compared to $6,099 at the end of the previous fiscal year. The company’s employee headcount remained stable, with 46,881,475 shares outstanding. The management indicated that additional funding will be necessary to sustain operations, and they are exploring various avenues for financing, including potential monetization of NewStem's technology.

Looking ahead, NovelStem's management remains cautious but optimistic about future prospects, emphasizing the need for continued financial support from shareholders and the successful monetization of its remaining assets. The company is actively pursuing fundraising efforts and exploring opportunities to leverage its technology in the biotech sector, although there are no guarantees of success in these endeavors.