Target Group Inc 10-Q for FY2025 Q3

Target Group Inc. (CBDY)

10-Q 2025-11-07 For: 2025-09-30

Added on April 06, 2026

About this 10-Q

Target Group Inc filed this 10-Q on November 7, 2025, covering the quarter ended September 30, 2025 (FY2025 Q3).

Headline figures

Quarter ended September 30, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $499.65K; down 7.7% from $541.11K a year earlier
Net loss: $479.39K; compared with a net loss of $528.95K a year earlier
Diluted EPS: -$0.00; compared with -$0.00 a year earlier

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☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2025

or

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


Delaware	46-3621499
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)

20 Hempstead Drive Hamilton, Ontario, Canada	L8W 2E7
(Address of principal executive officers)	(Zip Code)

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☒	Smaller reporting company ☒
	Emerging growth company ☐

Title of each class		Trading symbol		Name of each exchange on which registered
N/A		N/A		N/A


PART I – FINANCIAL INFORMATION

Item 1.	Condensed Consolidated Interim Financial Statements (Unaudited)	3

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	4

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	12

Item 4.	Controls and Procedures	12

PART II – OTHER INFORMATION

Item 1.	Legal Proceedings	13

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	13

Item 3.	Defaults Upon Senior Securities	13

Item 4.	Mine Safety Disclosures	13

Item 5.	Other Information	13

Item 6.	Exhibits	14

Condensed Consolidated Balance Sheets as of September 30, 2025 (Unaudited) and December 31, 2024	F-1

Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended September 30, 2025 and 2024 (Unaudited)	F-2

Condensed Consolidated Statements of Stockholders’ Deficit for the three and nine months ended September 30, 2025 and 2024 (Unaudited)	F-3

Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2025 and 2024 (Unaudited)	F-7

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)	F-8 - F-24


		September 30,	December 31,
		2025	2024
		$	$
		(unaudited)
ASSETS
Current assets
Cash		337,488	1,869,767
Restricted cash		8,260	7,992
Accounts receivable, net of allowance	Note 3	312,541	77,092
Inventory	Note 4	1,423,962	882,279
Prepaid asset		40,584	39,268
Convertible note receivable	Note 5	—	139,000
Interest receivable	Note 5	—	29,334
Sales tax recoverable, net of allowance	Note 6	55,416	53,674
Other receivable	Note 10	3,592	3,475
Total current assets		2,181,843	3,101,881
Long term assets
Fixed assets	Note 7	3,725,158	4,185,559
Goodwill	Note 9	255,989	247,685
Operating lease right-of-use assets	Note 11	34,112	38,408
Total long term assets		4,015,259	4,471,652
Total assets		6,197,102	7,573,533

LIABILITIES AND STOCKHOLDERS’ DEFICIENCY
Current liabilities
Bank overdraft		506	506
Accounts payable and accrued liabilities		2,263,560	3,092,563
Deferred revenue	Note 1	104,100	—
Payable to related parties, net	Note 10	10,198,072	9,854,719
Operating lease liability - Current portion	Note 11	165,371	140,202
Convertible promissory notes, net	Note 12	480	480
Derivative liability	Note 12	7,973	7,959
Total current liabilities		12,740,062	13,096,429

Long term liabilities
Payable to related parties, net - Non-current portion	Note 10	—	—
Operating lease liability - Non-current portion	Note 11	890,579	984,691
Warrant liability	Note 13	—	42
Total long term liabilities		890,579	984,733
Total liabilities		13,630,641	14,081,162

Stockholders’ deficiency
Preferred stock	Note 13	100	100
Common stock	Note 13	61,703	61,703
Shares to be issued	Note 13	175,439	175,439
Additional paid-in capital		24,985,697	24,985,697
Accumulated deficit		(31,754,219)	(30,946,844)
Accumulated comprehensive loss		(902,259)	(783,724)
Total stockholders’ deficiency		(7,433,539)	(6,507,629)
Total liabilities and stockholders’ deficiency		6,197,102	7,573,533
Contingencies and commitments	Note 15	—	—


		For the	For the	For the	For the
		three months ended	three months ended	nine months ended	nine months ended
		September 30, 2025	September 30, 2024	September 30, 2025	September 30, 2024
		$	$	$	$

REVENUE		499,650	541,113	3,145,813	4,736,055
COST OF GOOD SOLD		(235,291)	(173,006)	(1,365,206)	(2,088,954)
Gross profit		264,359	368,107	1,780,607	2,647,101
OPERATING EXPENSES
Advisory and consultancy fee		34,550	40,730	144,303	183,244
Management services fee		83,288	75,831	323,652	263,365
Legal and professional fees		49,446	32,067	145,674	150,152
Depreciation expense		227,647	206,628	673,065	646,290
Operating lease expense	Note 11	48,544	56,286	147,502	165,896
Office and general		76,536	194,356	311,362	456,273
Travel expenses		—	(10)	—	7,352
Total operating expenses		520,011	605,888	1,745,558	1,872,572

OTHER EXPENSES (INCOME)
Change in fair value of derivative and warrant liability		(2,317)	(8,427)	(28)	14
Gain on settlement		—	50	—	(36,758)
Interest and bank charges		266,716	268,186	781,452	890,572
Exchange (income) loss		(42,454)	31,194	65,160	(40,351)
Interest income		(260)	(8,796)	(34,040)	(8,796)
Recovery of sales tax recoverable		(3,992)	(3,338)	155	(11,558)
Debt issuance cost	Note 10	6,047	12,300	29,725	36,860
Total other expense		223,740	291,169	842,424	829,983

Net loss before income taxes		(479,392)	(528,950)	(807,375)	(55,454)
Income taxes		—	—	—	—
Net loss		(479,392)	(528,950)	(807,375)	(55,454)

Foreign currency translation adjustment		76,311	(71,160)	(118,535)	31,490
Comprehensive loss		(403,081)	(600,110)	(925,910)	(23,964)

Earnings (loss) per share - basic and diluted		(0.0008)	(0.0009)	(0.0013)	(0.0001)
Weighted average shares - basic and diluted		617,025,999	617,025,999	617,025,999	617,025,999


							Stock	Additional		Accumulated
	Preferred stock		Common stock		Shares to be issued		subscription	paid-in	Accumulated	comprehensive
	Shares	Amount	Shares	Amount	Shares	Amount	receivable	capital	deficit	loss	Total
	#	$	#	$	#	$	$	$	$	$	$
As at June 30, 2025	1,000,000	100	617,025,999	61,703	1,641,520	175,439	—	24,985,697	(31,274,827)	(978,570)	(7,030,458)

Net loss	—	—	—	—	—	—	—	—	(479,392)	—	(479,392)

Foreign currency translation	—	—	—	—	—	—	—	—	—	76,311	76,311

As at September 30, 2025	1,000,000	100	617,025,999	61,703	1,641,520	175,439	—	24,985,697	(31,754,219)	(902,259)	(7,433,539)


Furniture & office equipment	Straight-line	7 years
Machinery & equipment	Straight-line	3-5 years
Software	Straight-line	3 years
Leasehold improvements	Straight-line	Lease period


		As at
Product		September 30, 2025
		$
Finished goods		661,172
WIP (Flowers and plants)		762,790
		1,423,962


	Furniture &	Machinery &		Leasehold
	fixture	Equipment	Software	improvements	Total
	$	$	$	$	$
Cost	1,413,073	768,654	51,572	6,645,274	8,878,573
Accumulated depreciation	(882,599)	(767,916)	(46,875)	(3,456,025)	(5,153,415)
	530,474	738	4,697	3,189,249	3,725,158


Period ended	January 1 to April 27, 2023
	CAD	USD
Sales	1,068,799	791,285
Cost of goods sold	620,344	459,271
Gross profit	448,455	332,014
Operation expenses	383,358	283,819
Net income	65,097	48,195

Eligible recoverable expenses	1,437,054	1,060,833
Recoverable amount	1,437,054	1,060,833
Income on equity	32,549	24,098


		USD

Investment in JV		1,023,608
Receivable from JV		698,645
Payable to JV		(129,185)
		1,593,068

Cash received from Thrive		776,382
Net amount		816,686

Assets acquired:
Accounts receivable		163,244
Inventory		1,690,368
Fixed asset		534,816
		2,388,428

Net gain as per reconciliation		1,571,742


		$
Number of Common Stock		25,500,000
Market price on the date of issuance		0.067
Fair value of Common Stock		1,695,750


		$
Number of warrants		25,000,000
Fair value price per warrant		0.065
Fair value of warrant		1,623,092

Fair value of Common Stock		1,695,750
Fair value of warrant		1,623,092
Purchase consideration		3,318,842


2026	$	7,486,502
Total		7,486,502
Current portion		(7,486,502)
Non-current portion	$	—


	Interest rate		Maximum loan		Outstanding loan
			CAD	USD	CAD	USD
Tranche 1	16.00	%	1,043,593	773,094	1,043,593	773,094
Tranche 2	43.26	%	1,592,787	1,179,937	1,592,787	1,179,937
Tranche 3	43.26	%	150,000	111,120	150,000	111,120
Tranche 4	43.26	%	—	—	—	—
Tranche 5	43.26	%	100,000	74,080	—	—
Total			2,886,380	2,138,231	2,786,380	2,064,151


2026	$	79,269
2027		320,246
2028		323,448
2029		326,683
Thereafter		441,032
Total lease payments		1,490,678
Less imputed interest		(434,728)
Present value of lease liabilities		1,055,950
Current portion		(165,371)
Non-current portion	$	890,579


	Derivative	Conversions /			Derivative
	liability as at	Redemption			liability as at
	December 31,	during the	Change due to	Fair value	September 30,
	2024	period	Issuances	adjustment	2025
	$	$	$	$	$
Note D	864	—	—	23	887
Note F	5,205	—	—	(7)	5,198
Note G	1,890	—	—	(2)	1,888
	7,959	—	—	14	7,973


	Shares	Amount		Description
				80,000 shares of common stock to be issued as compensation to advisers and consultants. These were recorded at fair value of $52,000, based on the market price of the Company’s stock on the date of issue.
Services	115,000	$	73,000	35,000 to be issued as settlement of the amount due for website development services amounting to $247,306. The fair value of the shares on the date of settlement was $21,000, resulting in a gain on settlement amounting to $226,306 during the year ended December 31, 2017.
Private placements	346,296	$	18,787	Consideration for private placements with the fair value based on cash proceeds received. Proper allocation between common stock and additional paid-in capital of the amount received will be completed in the period when the shares are issued.
Settlement of loans of CannaKorp	930,240	$	80,838	Refer to Note 10 for details.
Agreement with Serious Seeds	249,984	$	2,814	As consideration for intellectual property rights granted by Smit. The fair value is based on the market price of the Company’s stock on the date of issue as per the agreement.
	1,641,520	$	175,439


	During quarter	During quarter	During quarter
	ended	ended	ended
	September 30, 2025	June 30, 2025	March 31, 2025
Forfeiture rate	0%	0%	0%
Stock price	$0.002 to $0.003	$0.002 to $0.003	$0.002 to $0.003
Exercise price	$0.350	$0.350	$0.350
Volatility	476%	476%	476%
Risk free interest rate	4.10% to 4.98%	3.66% to 4.60%	3.66% to 4.60%
Expected life (years)	2	2	2
Expected dividend rate	0%	0%	0%
Fair value of warrants	$0	$0	$0


			Remaining	Remaining
			contractual life	contractual life
	Warrants	Warrants	term as at	term as at
	outstanding as at	outstanding as at	September 30,	December 31,
	September 30,	December 31,	2025	2024
	2025	2024	(years)	(years)
Serious Seeds	50,001	200,004	0.01 to 0.18	0.01 to 0.93
CLI	—	10,000,000	0.00	0.62
Total	50,001	10,200,004


Warrant liability as at December 31, 2024		42
Warrant liability for new issuance		—
Change in fair value		(42)
Warrant liability as at September 30, 2025		—


1st year:		2.00% of gross sales
2nd year:		2.25% of gross sales
3rd year:		2.50% of gross sales
4th year:		2.75% of gross sales
5th and following years:		3.00% of gross sales


		Incorporated by Reference
Exhibit No.	Description	Form	Exhibit	Filing Date
2.1	Asset Acquisition Agreement	8-K	2.1	12/11/14

2.1.1	Agreement and Plan of Share Exchange dated June 27, 2018 with Visava Inc.	8-K	2.1	07/03/18

2.1.2	Agreement and Plan of Share Exchange dated January 25, 2019 with CannaKorp Inc. and David Manly, as Stockholder Representative	8-K	2.1	01/29/19

3(i)(a)	Articles of Incorporation	10-12G	3.1	09/30/13

3(i)(a)	Amended Articles of Incorporation	10-K	3(i)(a)	03/18/22

3(i)(a)	Certificate of Amendment	8-K	3(i)	10/20/16

3(i)(a)	Certificate of Amendment	8-K	3(i)	04/12/17

3(i)(a)	Certificate of Amendment	8-K	3(i)	07/06/17

3(i)(a)	Certificate of Amendment	8-K	3(i)	11/01/17

3(i)(a)	Certificate of Amendment	8-K	3(i)	10/01/18

3.2	Bylaws	10-12G	3.2	09/30/13

4.1	Description of Capital Stock	10-K	4.1	04/14/20

10.1	Form of Securities Purchase Agreement-Blackbridge Capital Growth Fund, LLC	10-K	10.1	03/31/17

10.2	Form of Convertible Promissory Note	10-K	10.2	03/31/17

10.3	Form of Convertible Promissory Note	10-K	10.3	03/31/17

10.4	Form of Convertible Promissory Note	10-K	10.4	03/31/17

10.5	Form of Securities Purchase Agreement-Crown Bridge Partners, LLC	10-K	10.5	03/31/17

10.6	Form of Convertible Promissory Note	10-K	10.6	03/31/17

10.10	Securities Purchase Agreement-Power Up Lending Group Ltd.	10-K	10.10	03/28/18

10.11	Convertible Promissory Note-Power-Up Lending Group Ltd.	10-K	10.11	03/28/18

10.12	Securities Purchase Agreement-Power Up Lending Group Ltd.	10-K	10.12	03/28/18

10.13	Convertible Promissory Note-Power-Up Lending Group Ltd.	10-K	10.13	03/28/18

10.14	Securities Purchase Agreement-Power Up Lending Group Ltd. dated December 24, 2018	10-K	10.14	04/01/19


10.15	Convertible Promissory Note-Power-Up Lending Group Ltd. dated December 24, 2018	10-K	10.15	04/01/19

10.16	Distribution, Collaboration and Licensing Agreement dated December 6, 2018 between Target Group Inc, Canary Rx Inc., Serious Seeds B.V. and Simon Smit	10-K	10.16	04/01/19

10.17	Licensed Producer/Licensed Processor Sales Agency Agreement dated December 13, 2018 with Cannavolve Inc.	10-K	10.17	04/01/19

10.18	Exclusive License Agreement dated August 8, 2019 with cGreen Inc.	8-K	2.1	08/13/19

10.19	Purchase, Licensing and Purchase Agreement dated September 17, 2019 between CannaKorp, Inc. and Nabis Arizona LLC	8-K	10.1	09/19/19

10.20	Loan Agreement dated December 20, 2019 with Jerry Zarcone	10-K	10.20	04/14/20

10.21	First Amending Agreement dated March 11, 2020 with Jerry Zarcone	10-Q	10.21	06/05/20

10.22	Second Amending Agreement dated April 30, 2020 with Jerry Zarcone	10-Q	10.22	08/10/20

10.23	Third Amending Agreement dated May 15, 2020 with Jerry Zarcone	10-Q	10.23	08/10/20

10.24	Promissory Note Between Target Group Inc. and Frank Zarcone	10-Q	10.24	08/10/20

10.25	Joint Venture Agreement between Canary Rx Inc. and 9258159 Canada, Inc. dated May 14, 2020	10-Q	10.25	08/10/20

10.26	Debt Purchase and Assignment Agreement dated June 15, 2020	8-K	10.1(i)	08/18/20

10.27	Amendment dated August 14, 2020 to Debt Purchase and Assignment Agreement	8-K	10.1(ii)	08/18/20

10.29	Fourth Amending Agreement dated June 12, 2021	10-Q	10.29	11/7/22

10.30	Fifth Amending Agreement dated February 16, 2022	10-Q	10.30	11/7/22

10.31	Sixth Amending Agreement dated October 18, 2022	10-Q	10.31	11/7/22

10.32	Seventh Amending Agreement dated February 16, 2023	10-Q	10.32	5/8/23

10.33	Eighth Amending Agreement dated March 28, 2023	10-Q	10.33	5/8/23

10.34	Seventh Amending Agreement dated February 16, 2023 (corrected)	10-Q	10.34	8/9/23

10.35	Ninth Amending Agreement dated November 7, 2023	10-Q	10.35	11/08/23

10.36	Tenth Amending Agreement dated August 16, 2024	10-Q	10.36	11/07/24

10.37	Eleventh Amending Agreement dated August 11, 2025	10-Q	10.37	8/12/25

31.1*	Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.


31.2*		Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1*		Certification of Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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Exhibit 104		Cover Page Interactive Data File - The cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document

	TARGET GROUP INC.

Dated: November 7, 2025	By:	/s/ Anthony Zarcone
		Chief Executive Officer, and Director

Dated: November 7, 2025	By:	/s/ Barry Alan Katzman
		Director

Dated: November 7, 2025	By:	/s/ Saul Niddam
		Director

Dated: November 7, 2025		/s/ Anthony Zarcone
		Chief Executive Officer

Dated: November 7, 2025		/s/ Anthony Zarcone
		Principal Financial Officer