NIVF 20-F/A
NewGenIvf Group Ltd (NIVF)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Amendment No. 1)
(Mark One)
or
For the fiscal year
ended
or
or
Date of event requiring this shell company report
For the transition period from ___________________________ to ___________________________
Commission file number
(Exact name of Registrant as specified in its charter)
(Translation of Registrant’s name into English)
(Jurisdiction of incorporation or organization)
36/39-36/40, 13th Floor, PS Tower
Sukhumvit 21 Road (Asoke)
(Address of Principal Executive Offices)
Tel:
(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)
Securities registered or to be registered pursuant to Section 12(b) of the Act.
| Title of each class | Trading Symbol | Name of each exchange on which registered | ||
| The Nasdaq Stock Market LLC (The | ||||
| The Nasdaq Stock Market LLC (The |
Securities registered or to be registered pursuant to Section 12(g) of the Act.
(Title of Class)
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.
(Title of Class)
Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report.
The number of NewGenIvf Group Limited’s
outstanding: (i) Class A Ordinary Shares, no par value, was
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
| ☐ Yes ☒ |
If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
| ☐ Yes ☒ |
Note – Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
| ☒ |
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
| ☒ |
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See definition of “large accelerated filer, “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer ☐ | Accelerated filer ☐ | |
| Emerging growth company |
If an emerging growth company that prepares its
financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition
period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange
Act.
| † | The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012. |
Indicate by check mark whether the registrant
has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial
reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or
issued its audit report.
If securities are registered pursuant to Section
12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction
of an error to previously issued financial statements.
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive- based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:
| International Financial Reporting Standards as issued by the International Accounting Standards Board ☐ | Other ☐ |
If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow. ☐ Item 17 ☐ Item 18
If this is an annual report, indicate by check
mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes
(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)
Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. ☐ Yes ☐ No
EXPLANATORY NOTE
This Amendment No.1 on Form 20-F/A (the “Amendment”) is being filed by NewGenIvf Group Limited (the “Company”, “We”, “Our”, or “us”) to amend the Company’s Annual Report on Form 20-F for the fiscal year ended December 31, 2024, originally filed with the U.S. Securities Exchange Commission on April 22, 2025 (the “Original Filing”). The Company is filing this Amendment solely to remove JAK Opportunities VI LLC, including the affiliated holders (“JAK”) as a related party and the Company’s transactions with JAK from Item 7.B “Related Party Transaction” of the Original Filing and Note 17 (Related Party Balances and Transactions) to the consolidated financial statements for the year ended December 31, 2024 included in the Original Filing.
Item 7.B of Form 20-F requires disclosure of certain information with respect to related party transactions. In the Original Filing, the Company included JAK as a related party and disclosed certain transactions with JAK as related party transactions. According to the instruction to Item 7.B. of Form 20-F, shareholders beneficially owning a 10% interest in the voting power of the Company are presumed to have significant influence. In addition, significant influence over an enterprise is the power to participate in the financial and operating policy decisions of the enterprise but is less than control over those policies. As JAK owns less than 10% of the voting power of the Company and has no influence on the board and management of the Company, it has been determined that the Company’s transactions with JAK would not be considered as related party transactions in the Item 7.B and Note 17 to the consolidated financial statements for the year ended December 31, 2024.
This Amendment consists solely of the cover page, this Explanatory Note, the updated Item 7.B (Related Party Transaction) in Form 20-F and the updated Note 17 to the Audited Consolidated Financial Statements contained within the Form 20-F, including the certifications by our chief executive officer and chief financial officer. This Amendment does not affect any other parts of, or any other exhibits to, the Original Filing, nor does it reflect events occurring after the date of the Original Filing. Accordingly, this Amendment should be read in conjunction with the Original Filing. The Company’s Chief Executive Officer and Chief Financial Officer are providing current dated revised certifications in connection with this Amendment. The certifications are filed as Exhibits 12.1, 12.2, 12.3 and 12.4.
Table of Contents
| Page | ||
| PART I | 1 | |
| Item 7. Major Shareholders and Related Party Transactions | 1 | |
| PART III | 2 | |
| ITEM 19. EXHIBITS | 2 |
i
PART I
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
B. Related Party Transactions
A summary of related parties of the Company is as follows:
| Relationship | ||
| Mr. Siu, Wing Fung Alfred and Ms. Fong, Hei Yue Tina* | Shareholders and directors | |
| Harcourt Limited | Controlled by Mr. Siu |
| * | Ms. Fong is the spouse of Mr. Siu |
Transaction with Mr. Wing Fung Alfred Siu and Ms. Hei Yue Tina Fong
Historically, certain amount of cash provided by operating activities was given to Mr. Wing Fung Alfred Siu and Ms. Hei Yue Tina Fong, resulting in amount due from them. For the year ended December 31, 2023, the largest aggregate amount due from Mr. Siu, Wing Fung Alfred and Ms. Fong, Hei Yue Tina was US$2,240,872. Mr. Siu and Ms. Fong had repaid the outstanding amounts due pursuant to the terms and conditions of the repayment agreement dated August 14, 2023. As of December 31, 2024, the aggregate balance of amount due to Mr. Siu and Ms. Fong was US$92,651.
In addition, NewGenIvf also recorded remuneration to its directors, Mr. Siu and Ms. Fong. The remuneration to Mr. Siu, Wing Fung Alfred was US$125,000 and US$190,000 during the year ended December 31, 2023 and 2024, respectively. The remuneration during the years ended December 31, 2023 and 2024 was all in the nature of the fair value of the services provided by Mr. Siu and Ms. Fong. Mr. Siu Wing Fung also entered into agreement to waive the balance of due from the Company of US$88,151 in 2023.
1
PART III
ITEM 19. EXHIBITS
The following exhibits are filed as part of this Amendment No. 1 to Annual Report on Form 20-F/A:
| Exhibit No. | Description | |
| 12.1* | Certification by Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
| 12.2* | Certification by Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
| 13.1* | Certification by Principal Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
| 13.2* | Certification by Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
| 101.INS* | Inline XBRL Instance Document. | |
| 101.SCH* | Inline XBRL Taxonomy Extension Schema Document. | |
| 101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase Document. | |
| 101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase Document. | |
| 101.LAB* | Inline XBRL Taxonomy Extension Label Linkbase Document. | |
| 101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | |
| 104* | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
| * | Filed herewith. |
2
SIGNATURES
The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F/A and that it has duly caused and authorized the undersigned to sign this Amendment No.1 to Annual report on Form 20-F/A on its behalf.
| Signature | Title | Date | ||
| /s/ Wing Fung Alfred Siu | Chairman, Chief Executive Officer | May 15, 2025 | ||
| Wing Fung Alfred Siu | (Principal Executive Officer and Duly Authorized Officer) | |||
| /s/ Ho Fai Chung | Chief Financial Officer | May 15, 2025 | ||
| Ho Fai Chung | (Principal Financial Officer and Principal Accounting Officer) |
3
NEWGENIVF GROUP LIMITED
F-1
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
| To: | The Board of Directors and Shareholders of NewgenIvf Limited |
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheet of NewgenIvf Limited and its subsidiaries (collectively, the “Company”) as of December 31, 2023, the related consolidated statements of operations and comprehensive income, shareholders’ equity, and cash flows for the year ended December 31, 2023, and the related notes to the consolidated financial statements and schedule (collectively, the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023, and the results of its operations and its cash flows for the year ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.
Material Uncertainty relating to Going Concern
The accompany financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the financial statements, the Company had bank balance of $54,104 as of December 31, 2023 and for the year ended December 31, 2023, the Company had operating cash outflows of $1,766,135. This raises substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 3. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Our opinion is not modified in respect of this matter.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
| /s/ Onestop Assurance PAC |
We have served as the Company’s auditor since 2024.
Singapore
August 16, 2024
F-2
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
| To: | The Board of Directors and Shareholders of NewgenIvf Group Limited |
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheet of Newgenivf Group Limited and its subsidiaries (collectively, the “Company”) as of December 31, 2024, the related consolidated statements of operations and comprehensive income, shareholders’ equity, and cash flows for the year ended December 31, 2024, and the related notes to the consolidated financial statements and schedule (collectively, the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024, and the results of its operations and its cash flows for the year ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.
Substantial Doubt about the Company’s Ability to Continue as a Going Concern
The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3, the Company has generated a loss and suffered from an accumulated deficit of $985,994 as of December 31, 2024 and a deficit in shareholders’ equity of $1,481,757 as of that date. These matters raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans with regards to these matters are also described in Note 3 to the financial statements. These financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
/s/
Certified Public Accountants
Firm ID:
We have served as the Company’s auditor since 2024.
April 22, 2025
F-3
NEWGENIVF GROUP
LIMITED
CONSOLIDATED BALANCE SHEETS
AS OF DECEMBER 31, 2024 AND 2023
(Stated in US Dollars)
| December 31, | December 31, | |||||||
| 2024 | 2023** | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Accounts receivable, net | ||||||||
| Inventories | ||||||||
| Deposits, other receivables and deferred legal & IPO cost, net | ||||||||
| Deposit with a digital asset trading platform | ||||||||
| Receivable from agents | ||||||||
| Prepayments | ||||||||
| Loan to A SPAC I | ||||||||
| Due from shareholders | ||||||||
| Total current assets | ||||||||
| Non-current assets | ||||||||
| Plant and equipment, net | ||||||||
| Right-of-use assets, net | ||||||||
| Prepayments | ||||||||
| Total non-current assets | ||||||||
| TOTAL ASSETS | $ | $ | ||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | $ | ||||||
| Accrued liabilities and other payables | ||||||||
| Contract liabilities | ||||||||
| Due to related parties | ||||||||
| Operating lease liabilities, current | ||||||||
| Finance lease liabilities, current | ||||||||
| Convertible notes | ||||||||
| Promissory note | ||||||||
| Taxes payable | ||||||||
| Total current liabilities | ||||||||
| Non-current liabilities | ||||||||
| Operating lease liabilities, non-current | ||||||||
| Convertible notes, non-current | ||||||||
| Total non-current liabilities | ||||||||
| Total liabilities | $ | $ | ||||||
| Shareholders’ equity | ||||||||
| Ordinary shares, par value, | $ | $ | ||||||
| Subscription receivable | ( | ) | ( | ) | ||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Accumulated other comprehensive (loss) income | ( | ) | ||||||
| Equity attributable to the shareholders of the Company | ( | ) | ||||||
| Non-controlling interests | ( | ) | ( | ) | ||||
| Total shareholders’ equity | ( | ) | ||||||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | $ | ||||||
| * | |
| ** |
The accompanying notes are an integral part of these consolidated financial statements.
F-4
NEWGENIVF GROUP
LIMITED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
FOR THE YEARS ENDED DECEMBER 31, 2024, 2023
AND 2022
(Stated in US Dollars)
| December 31, | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Revenues | $ | $ | $ | |||||||||
| Cost of revenues | ( | ) | ( | ) | ( | ) | ||||||
| Gross profit | ||||||||||||
| Operating expenses | ||||||||||||
| Selling and marketing expenses | ( | ) | ( | ) | ( | ) | ||||||
| General and administrative expenses | ( | ) | ( | ) | ( | ) | ||||||
| Total operating expenses | ( | ) | ( | ) | ( | ) | ||||||
| Operating (loss) income | ( | ) | ||||||||||
| Other income (expenses), net | ||||||||||||
| Other income, net | ||||||||||||
| Interest income | ||||||||||||
| Interest expense | ( | ) | ( | ) | ( | ) | ||||||
| Total other income (expenses), net | ( | ) | ||||||||||
| (Loss) Income before taxes | ( | ) | ||||||||||
| Tax income (expense) | ( | ) | ||||||||||
| Net (loss) income | ( | ) | ||||||||||
| Less: net income (loss) attributable to non-controlling interests | ( | ) | ( | ) | ||||||||
| Net (loss) income attributable to the shareholders of the Company | $ | ( | ) | $ | ||||||||
| Other comprehensive income (loss) | ||||||||||||
| Foreign currency translation adjustment | ( | ) | ( | ) | ||||||||
| Total comprehensive (loss) income | ( | ) | ||||||||||
| Less: total comprehensive (loss) income attributable to non-controlling interests | ( | ) | ( | ) | ||||||||
| Total comprehensive (loss) income attributable to the shareholders of the Company | $ | ( | ) | $ | ||||||||
| Earnings per share – basic | $ | ( | ) | $ | ||||||||
| – diluted | ( | ) | ||||||||||
| Weighted average shares outstanding *- basic | ||||||||||||
| – diluted | ||||||||||||
| ● |
The accompanying notes are an integral part of these consolidated financial statements.
F-5
NEWGENIVF GROUP
LIMITED
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (DEFICIT)
FOR THE YEARS ENDED DECEMBER 31,
2024, 2023 AND 2022
(Stated in US Dollars)
| Number of shares | Ordinary shares | Subscription receivable | Additional paid-in capital | Accumulated deficit | Accumulated other comprehensive income/(loss) | Total attributable to the shareholders of the Company | Non- controlling interests | Total | ||||||||||||||||||||||||||||
| Balance, January 1, 2022** | $ | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||
| Net income (loss) | — | ( | ) | |||||||||||||||||||||||||||||||||
| Foreign currency translation adjustment | — | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||
| Capital injection by directors | — | |||||||||||||||||||||||||||||||||||
| Issuance of shares | — | — | $ | ( | ) | |||||||||||||||||||||||||||||||
| Balance, December 31, 2022** | $ | ( | ) | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | |||||||||||||||||||||||
| Balance, January 1, 2023 | — | ( | ) | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | |||||||||||||||||||||||
| Net income (loss) | — | ( | ) | |||||||||||||||||||||||||||||||||
| Foreign currency translation adjustment | — | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||
| Settlement of subscription receivable | — | |||||||||||||||||||||||||||||||||||
| Issuance of shares | — | — | ||||||||||||||||||||||||||||||||||
| Balance, December 31, 2023** | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | |||||||||||||||||||||
| Balance, January 1, 2024 | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | |||||||||||||||||||||
| Net (loss) income | — | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| Foreign currency translation adjustment | — | — | ||||||||||||||||||||||||||||||||||
| Reverse capitalization | — | — | ( | ) | ( | ) | — | ( | ) | |||||||||||||||||||||||||||
| Settlement of subscription receivable | — | — | — | |||||||||||||||||||||||||||||||||
| Remeasurement of share based compensation | — | — | ( | ) | ( | ) | — | ( | ) | |||||||||||||||||||||||||||
| Issuance of shares under ELOC/Note Conversion arrangement | ( | ) | — | |||||||||||||||||||||||||||||||||
| Balance, December 31, 2024 | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
| * | The no of shares as presented have been adjusted retrospectively for a Reverse Share Split effected in February 2025 of 1 share for every 20 existing share issued. |
| ** |
The accompanying notes are an integral part of these consolidated financial statements.
F-6
NEWGENIVF GROUP
LIMITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022
(Stated in US
Dollars)
| December 31, | ||||||||||||
| 2024 | 2023** | 2022** | ||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||||||
| Net (loss) income | $ | ( |
) | $ | $ | |||||||
| Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||||||||||||
| Depreciation of plant and equipment | ||||||||||||
| Amortization of right-of-use assets | ||||||||||||
| Loss on disposal of plant and equipment | ||||||||||||
| Amortisation of share-based compensation expense | ||||||||||||
| Non cash discount on convertible notes | ||||||||||||
| Provision of expected credit loss allowance | ||||||||||||
| Interest expense | ||||||||||||
| Waiver of related party balance | ( |
) | ||||||||||
| Gain on lease modification | ( |
) | ||||||||||
| Gain on promissory note | ( |
) | ||||||||||
| Directors’ remuneration | ||||||||||||
| Legal and professional fee | ||||||||||||
| (Gain on) Provision for income taxes | ( |
) | ||||||||||
| Changes in operating assets and liabilities: | ||||||||||||
| Accounts receivable | ( |
) | ||||||||||
| Inventories | ( |
) | ( |
) | ||||||||
| Deposit and other receivables, net | ( |
) | ( |
) | ( |
) | ||||||
| Accounts payable | ||||||||||||
| Accrued liabilities and other payables | ( |
) | ( |
) | ||||||||
| Contract liabilities | ( |
) | ||||||||||
| Operating lease liabilities | ( |
) | ( |
) | ( |
) | ||||||
| Finance lease liabilities | ( |
) | ||||||||||
| Tax paid | ( |
) | ||||||||||
| Net cash (used in) provided by operating activities | ( |
) | ( |
) | ||||||||
| CASH FLOWS FROM INVESTING ACTIVITY | ||||||||||||
| Purchase of plant and equipment | ( |
) | ( |
) | ( |
) | ||||||
| Net cash used in investing activity | ( |
) | ( |
) | ( |
) | ||||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||||||
| Amount due from A SPAC I | ( |
) | ||||||||||
| Finance lease | ( |
) | ( |
) | ( |
) | ||||||
| Other borrowings, net | ||||||||||||
| Issuance of shares (net of reverse capitalization effect) | ||||||||||||
| Interest paid | ( |
) | ( |
) | ||||||||
| Amount with related parties | ( |
) | ||||||||||
| Subscription receivable | ||||||||||||
| Net cash provided by (used in) financing activities | ( |
) | ||||||||||
| Net increase/(decrease) in cash and cash equivalents | ( |
) | ||||||||||
| Effect of foreign currency translation on cash and cash equivalents | ( |
) | ||||||||||
| Cash and cash equivalents, beginning of year | ||||||||||||
| Cash and cash equivalents, end of year | $ | $ | ||||||||||
| Supplementary cash flow information: | ||||||||||||
| Taxes paid | $ | $ | ( |
) | ||||||||
| Interest paid | $ | ( |
) | $ | ( |
) | ( |
) | ||||
| ** |
During the year ended December 31, 2024, no cash was exchanged in respect of these transactions:
| a. | $2,650,000 of convertible debt was converted into equity. |
| b. | Reversal arising from remeasurement of share-based compensation within prepayment amounting to $2,739,856. |
The accompanying notes are an integral part of these consolidated financial statements.
F-7
NEWGENIVF GROUP LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022
(Stated in US Dollars)
NOTE 1 — ORGANIZATION AND PRINCIPAL ACTIVITIES
Prior to the Business Combination, on April 29, 2021, A SPAC I Acquisition Corp. (“ASCA”), was incorporated as a British Virgin Islands business company, specifically a blank check company formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or similar business combination with one or more target businesses.
The Business Combination
On February 15, 2023, ASCA entered into the Merger Agreement (as amended on June 12, 2023 and December 6, 2023, the “Merger Agreement,” and the transactions contemplated thereunder, the “Business Combination”) with A SPAC I Mini Acquisition Corp., Merger Sub, NewGenIvf Limited, a Cayman Islands exempted company (“Legacy NewGenIvf”) and certain shareholders of Legacy NewGenIvf. Pursuant to the Merger Agreement, the Business Combination was effected in two steps: (i) ASCA was reincorporated to the British Virgin Islands by merging with and into A SPAC I Mini Acquisition Corp. (such transaction, the “Reincorporation Merger”) and then the listed company was renamed as NewGenIvf Group Limited; and (ii) Merger Sub merged with and into Legacy NewGenIvf, resulting in Legacy NewGenIvf being a wholly-owned subsidiary of the Company (such second step in isolation, the “Acquisition Merger”). The surviving entity of the Business Combination, together with its subsidiaries is referred to in this prospectus as “NewGenIvf,” the “Company,” “we,” “our,” or “us,” unless the context otherwise requires.
On June 12, 2023, the
parties to the Merger Agreement entered into the First Amendment to Merger Agreement (the “First Amendment”), pursuant to
which Legacy NewGenIvf agreed to provide non-interest bearing loans in an aggregate principal amount of up to $
On December 6, 2023, the
parties to the Merger Agreement entered into the Second Amendment to the Merger Agreement (the “Second Amendment”) which amended
and modified the Merger Agreement to, among other things, (i) reduce the size of NewGenIvf’s board of directors following the consummation
of the Business Combination to five (5) directors, two (2) of whom would be executive directors designated by NewGenIvf and three (3)
of whom will be designated by NewGenIvf to serve as independent directors in accordance with Nasdaq requirements, (ii) provide for the
conversion of NewGenIvf shares issued by NewGenIvf following the original date of the Merger Agreement into Class A Ordinary Shares in
connection with the Acquisition Merger, and (iii) remove the condition that ASCA have in excess of $
On April 3, 2024, the Business Combination was consummated with the Company as the surviving entity.
F-8
The following is an organization chart of the Company and its subsidiaries as of December 31, 2024:
The Company’s subsidiaries are detailed in the table as follows:
| Name | Background | Ownership % | Principal activity | |||
| NewGenivf Limited | ● A Cayman Islands company ● Incorporated on 16 January, 2019 | |||||
| FFPGS (HK) Limited | ● A Hong Kong company ● Incorporated on December 19, 2019 | |||||
| Well Image Limited | ● A Hong Kong company ● Incorporated on July 11, 2008 | |||||
| Med Holdings Limited (“Med Holdings”) (Note) | ● A Thailand company ● Incorporated on January 21, 2015 | |||||
| First Fertility PGS Center Limited (“FFC”) (Note) | ● A Thailand company ● Incorporated on March 6, 2014 | |||||
| First Fertility Phnom Penh Limited (“FFPP”) | ● A Cambodia company ● Incorporated on August 10, 2015 | |||||
| Bi Clinic Ltd (“FFBi”) | ● A Kyrgyzstan company ● Incorporated on December 16, 2021 ● Acquired on December 17, 2024 | |||||
| Shenzhen Qianhai Fengtai Renhui Health Technology Co., Ltd. (“SZ QianHai”) | ● A Shenzhen China, PRC company ● Incorporated on October 24, 2024 | |
| * |
F-9
Note:
According to Thailand’s Foreign Business Act (the “FBA”), the majority shareholdings of limited company incorporated in Thailand is required to be owned by Thai nationals.
With reference to the capital structure and voting rights structure of ordinary shares and preference shares (the “Share Structure”) of Med Holdings and FFC, all the preference share capital shall be owned by a Thai national. No preference shares, however, have been issued to date. The ordinary shares and preference shares have the same rights and status in all respects except for the distribution of profits by way of dividends with details as follow:
| (a) | Dividends from profits of Med Holdings and FFC shall be allocated to the holders of preference shares at a rate fixed from time to time by the board of directors prior to allocating to the holders of ordinary shares. In any event, such dividends to be allocated to the holders of preference shares shall not exceed |
| (b) | After allocation of dividends as per (a) above, the rest of the dividends shall be distributed equally amongst the holders of ordinary shares according to their shareholding ratio; |
| (c) | The holders of preferred shares shall be entitled to dividends only in respect of the years for which the Company has declared a dividend payment, and there shall be no cumulative dividends; and |
| (d) | Dividends allocated to the holders of preferred shares in each year shall be limited at the rate as stated in (a) only. No additional dividends shall be paid to the holders of preferred shares. |
Based upon the management’s judgement on the Shares Structure, as the Company is able to exercise majority voting power in any board meeting, the Company accounts for Med Holdings and FFC as subsidiaries on the ground that the Company is able to control Med Holdings and FFC by exercising its majority voting power in any board meetings.
On April 17, 2024, the Company entered into a non-binding term sheet
(the “Non-Binding Term Sheet”) with European Wellness Investment Holdings Limited (“EWIHL”) for (i) the potential
acquisition of the entire equity interest of EWIHL by the Company for a consideration of US$
On May 24, 2024, the Company received a deficiency letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company of its non-compliance with two (2) listing requirements for continued listing on Nasdaq pursuant to Nasdaq Listing Rules. On November 21, 2024, a delisting notice was received from the continued non-compliance. The Company had filed to appeal the delisting determination and undertook several strategic actions to regain compliance with Nasdaq’s listing require. On February 27, 2025. received approval for the transfer the Company’s securities from the Nasdaq Global Market to the Nasdaq Capital Market and on March 10, 2025 its compliance with the listing requirements thereof.
On June 3, 2024, the Company announced the execution of a non-binding
term sheet (the “Term Sheet”) regarding a proposed reverse merger (the “Proposed Transaction”) with pharmaceutical
company COVIRIX Medical Pty Ltd (“COVIRIX”). The consideration was to be settled by way of the issuance of issue
On August 7, 2024, the Company
entered into a Securities Purchase Agreement with certain investors named therein (collectively, the “Buyers”), pursuant to
which, amongst other things: (i) the Company agreed to sell, at an initial closing with JAK Opportunities VI LLC (“JAK” and
such initial closing, the “Initial Closing”), pursuant to which the Company agreed to sell to JAK (a) a senior convertible
note (the “Initial Note”) in the aggregate original principal amount not exceeding $
On August 12, 2024, the Company
and JAK consummated the Initial Closing. The Initial Note sold to JAK in connection with the Securities Purchase Agreement bears an interest
rate of
F-10
At the Initial Closing, the
Company also sold to JAK a Series A Warrant to purchase
Additionally, in connection
with the Securities Purchase Agreement, the Company entered into amendment and exchange agreements with certain holders of its convertible
promissory notes (the “Existing Notes” and each of such amendment and exchange agreements, “Amendment and Exchange Agreement”),
pursuant to which the Company will exchange the Existing Notes by issuing, among other things, (i) senior convertible notes in the aggregate
principal amount of $
On August 28, 2024, the Company
consummated the second tranche of its debt financing under the terms of the Securities Purchase Agreement. At the closing of the second
tranche, the Company sold to JAK Opportunities VI LLC (“JAK”) a senior convertible note (the “Note”) in the principal
amount of $
On November 11, 2024, the Company consummated the third tranche of
its debt financing under the terms of the Securities Purchase Agreement (“SPA”) referenced in the current report on Form 6-K
filed with the United States Securities and Exchange Commission (the “SEC”) on August 16, 2024. The Form 6-K filed with the
SEC on August 16, 2024 is incorporated by reference herein. Pursuant to the terms of the SPA, the Company may elect at the second additional
mandatory closing to sell and the institutional investor party to the SPA shall be required to purchases, subject to certain conditions,
an additional note (“Second Additional Mandatory Note”) in the principal amount of $
On November. 18, 2024, the
Company entered into a binding term sheet (the “Term Sheet”) with White Lion Capital, LLC, (“White Lion”) a California-based
institutional investor focused on high-growth, early-stage public companies, setting out the principal terms and conditions for a $
On November 29, 2024, the Company appointed Tam, Chun Wa to the Company’s Board of Directors (the “Board”). Mr. Tam will serve as an independent director. In addition, Mr. Tam has been named to the Audit Committee of the Board. Following the appointment of Mr. Tam, the Board consists of five members.
NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of consolidation and basis of preparation
The accompanying consolidated financial statements reflect the accounts of the Company and all of its subsidiaries in which a controlling interest is maintained. All inter-company balances and transactions have been eliminated in consolidation.
Management has prepared the accompanying consolidated financial statements and these notes in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The Company maintains its general ledger and journals with the accrual method accounting.
The business combination transaction between Legacy NewGenIvf and SPAC I was accounted for as a reverse recapitalization under ASC 805, Business Combinations, with NewGenIvf Group Limited, and deemed to be the accounting acquirer. As SPAC I did not meet the definition of a business under ASC 805, the transaction was not treated as a business combination. Instead, it was accounted for as a recapitalization.
Accordingly, the consolidated assets, liabilities and results of operations of the accounting acquirer will become the historical financial statements of the Company, and the accounting acquirer’s assets, liabilities and results of operations will be consolidated with the Company beginning on the acquisition date. The Legacy NewGenIvf was the legal acquiree but deemed to be the accounting acquirer. The Company was the legal acquirer but deemed to be the accounting acquiree in the reverse merger. The historical financial statements prior to the acquisition are those of the accounting acquirer (Legacy NewGenivf). After completion of the Share Exchange Transaction, the Company’s consolidated financial statements include the assets and liabilities, the operations and cash flow of the accounting acquirer. Any excess of the value of shares issued by the Company over the net book value of the accounting acquirer will be recognized as a reduction to equity (APIC).
F-11
Use of estimates
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 disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Actual results could differ from those estimates.
Foreign currency translation
The accompanying consolidated financial statements are presented in United States dollar (“$”), which is the reporting currency of the Company. The functional currency of the Company and its subsidiaries, FFPGS (HK) Limited and Well Image Limited, are Hong Kong dollar (“HK$”). Med Holdings and FFC use Thai baht (“THB”) as their functional currencies. First Fertility Phnom Penh Limited and Bi Clinic Ltd (“FFBi”) uses United States dollar (“USD”) as their functional currencies. Shenzhen Qianhai Fengtai Renhui Health Technology Co., Ltd. (“SZ QianHai”) uses Chinese Renminbi (“CNY”) as its functional currency.
Assets and liabilities denominated in currencies other than the reporting currency are translated into the reporting currency at the rates of exchange prevailing at the balance sheet date. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. Translation gains and losses are recognized in the consolidated statements of operations and comprehensive income as other comprehensive income or loss.
Transactions in currencies other than the reporting currency are measured and recorded in the reporting currency at the exchange rate prevailing on the transaction date. The cumulative gain or loss from foreign currency transactions is reflected in the consolidated statements of operations and comprehensive income as other income (other expenses).
The value of foreign currencies
including, the HK$, THB and RMB, may fluctuate against the United States dollar. Any significant variations of the aforementioned
currencies relative to the United States dollar may materially affect the Company’s financial condition in terms of reporting
in USD.
| 2024 | 2023 | 2022 | ||||||||||||
| Period-end | $: HK$ | |||||||||||||
| Period average | $: HK$ | |||||||||||||
| Period-end | $: THB | |||||||||||||
| Period average | $: THB | |||||||||||||
| Period-end | $: RMB | |||||||||||||
| Period average | $: RMB | |||||||||||||
Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits held at call with financial institutions, other short-term deposits with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.
Deposits, other receivables and deferred legal & IPO cost, net
Deposits, other receivables and deferred Initial Public Offering (“IPO”)
cost, net primarily include deposits paid to suppliers, prepaid expenses, the prepaid professional fee which meets the definition of deferred
IPO cost, and a cash deposit of US$
Deferred IPO costs consist of underwriting, legal, accounting and other expenses incurred through the balance sheet date that are directly related to the Initial Public Offering and that were charged to additional paid-in capital upon the completion of the Initial Public Offering.
Legal and professional fees incurred in connection with issuing convertible debt are deferred and amortized over the life of the debt. These costs are presented as a direct deduction from the carrying amount of the debt liability on the balance sheet (per ASC 835-30).
Share based compensation
The Company accounts for stock-based compensation in accordance with ASC Topic 718-10, Compensation-Stock Compensation, which requires the measurement and recognition of compensation expense for all share-based payment arrangements related to the acquisition of goods and services from both nonemployees and employees based on fair values of the shares to be issued estimated at grant date. The stock-based compensation expense recognized during the period is based on the value of the portion of share-based payment awards that is ultimately expected to vest during the period.
F-12
Fair value is determined based on the estimated market prices of the Company’s Common Stock at the respective issuance date in accordance with ASC 718, taking into consideration the volatility of the market price of the shares, the terms of the instruments and the conditions upon which they were granted.
Property and equipment, net
Plant and equipment are stated
at cost less accumulated depreciation. Depreciation is provided over their estimated useful lives, using the straight-line method.
The Company typically applies a salvage value of
| Furniture and fixtures | ||
| Leasehold improvements | ||
| Medical instruments | ||
| Motor vehicle | ||
| Office equipment |
The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts, and any gain or loss are included in the Company’s results of operations. The costs of maintenance and repairs are expensed as incurred. Significant renewals and betterments that extend the useful life of an assets are capitalized.
Impairment of long-lived assets
The Company evaluates the long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of assets may not be recoverable. Impairment may become obsolete from a difference in the industry, introduction of new technologies, or if the Company has inadequate working capital to utilize the long-lived assets to generate adequate profits. Impairment is present if the carrying amount of an asset is less than its expected future undiscounted cash flows.
If an asset is considered impaired, a loss is recognized based on the amount by which the carrying amount exceeds the fair market value of the asset. Assets to be disposed of are reported lower the carrying amount or fair value less cost to sell.
Inventories
Inventories are stated at the lower of cost and net realizable value. Costs are determined on a first-in, first-out basis. Net realizable value is based on the estimated selling prices less any estimated costs to be incurred to completion and disposal. A provision for excess and obsolete inventory will be made based primarily on products approaching expiry period and forecasts of product demand. The excess balance above the product demand as determined by this analysis becomes the basis for excess inventory charge and the written-down value of the inventory becomes its cost. Written-down inventory would not be reversed if market conditions improve.
Other borrowings
Other borrowings are recognized initially at fair value, net of debt issuance costs incurred. Other borrowings are subsequently stated at amortized cost; any difference between the proceeds (net of debt issuance costs) and the redemption value is recognized in the consolidated statements of operations over the period of the borrowings using the effective interest method.
Convertible Instruments
Convertible Instruments are categorized as equity or debt based on the terms of the notes. Convertible Notes are recorded at amounts equal to the proceeds of the issuance, including the embedded conversion feature, and net of discounts and unamortized debt issuance in accordance with ASC 480-10-55-44 on the consolidated balance sheets. An evaluation of all conversion, purchase and redemption features contained in a debt instrument is performed to determine if there are any embedded features that require bifurcation as a derivative. The conversion feature is recorded separately as a derivative liability at its fair value, calculated using the Black-Scholes model.
Debt issuance and offering costs are amortized over the contractual term of the Convertible Notes, to the consolidated statements of operations in accordance with ASC 835-30-45-1A.
The convertible notes are subsequently recorded at amortized cost, with interest expense recognized using the effective interest method. The derivative liability, if any is remeasured at fair value at each reporting date and any gain or loss on fair value is recognized in the statement of comprehensive income.
Promissory Notes
Promissory notes, originated from ASCA’s transaction and being taken over by NewGenIVF Group Limited upon merger, are of non-interest bearing and recorded at original cost. They are subsequently measured at amortised cost, with interest expense recognized using the effective interest method in the consolidated statement of income.
F-13
Ordinary shares
The Company’s ordinary shares are stated at no par value. The difference between the consideration received, net of issuance cost, is recorded in additional paid-in capital.
On January 21, 2025, the
Board of Directors of the Company approved a reverse stock split of all of the Company’s issued and unissued shares, including the
Class A ordinary shares with no par value (the “Class A Ordinary Shares”), Class B ordinary shares with no par value and preferred
shares with no par value, at an exchange ratio of one (1) share for twenty (
In accordance with ASC 505, the reverse stock split is to be accounted for retrospectively.
Revenue recognition
The Company adopted ASC Topic 606, Revenue from Contracts with Customers, and all subsequent ASUs that modified ASC 606 on April 1, 2017 using the full retrospective method which requires the Company to present the financial statements for all periods as if Topic 606 had been applied to all prior periods. The Company derives revenue principally from provision of In vitro fertilization (“IVF”) treatment and surrogacy and ancillary caring services. Revenue from contracts with customers is recognized using the following five steps:
| (1) | identify its contracts with customers; | |
| (2) | identify its performance obligations under those contracts; | |
| (3) | determine the transaction prices of those contracts; | |
| (4) | allocate the transaction prices to its performance obligations in those contracts; and | |
| (5) | recognize revenue when each performance obligation under those contracts is satisfied. Revenue is recognized when promised services are transferred to the client in an amount that reflects the consideration expected in exchange for those services. |
The Company enters into verbal agreements with its customers that outline the rights, responsibilities, and obligations of each party. The agreements also identify the scope of services, service fees, and payment terms. Agreements are acknowledged and consent forms are signed by the customers prior to each promised service or bundle of services are inter dependant. All the contracts have commercial substance, and it is probable that the Company will collect considerations from its customers for service component as settlement is predominantly required prior to performance of the promised service.
The Company derives its revenues from two sources: (1) revenue from IVF treatment, and (2) revenue from surrogacy and ancillary caring services.
Revenue from IVF treatment
In vitro fertilization (“IVF”) treatment is an assisted reproductive technique where eggs and sperm are collected and fertilized in laboratory to become embryo. Fertilized embryo is then implanted to the customer or a surrogate mother. IVF treatment involves the performance of a series of medical treatment as well as procedures and brings benefits to clients as the service of bundles service is completed. Revenue from IVF treatment is recognized at a point in time when different treatment and/or procedure or bundles thereof, are completed in clinic. The full completion of the various procedures and treatments are evidenced by treatment cards and reports included within the patient files indicating successful completion of the service.
Revenue from surrogacy and ancillary caring services
The Company provides surrogacy
and ancillary caring services solely in Kyrgyzstan. Embryo from blood parents is implanted to surrogate mother contracted by the Company
or its agents. During pregnancy period, the Company provides ancillary caring services including regular body check and provision of vitamins,
supplements and medicines to surrogate mothers. The key performance obligation is identified as a single performance obligation where
a baby is born, therefore revenue from surrogacy and ancillary caring services is recognized at a point in time when surrogate mother
gives birth. The Company collects approximately
Revenue from egg freezing and storage facility
The Company provides access the facility to its customers. Upon request for the service, which is agreed verbally and followed by signed consent form from the customer, the Company makes available access to the facility with no further substantial involvement. Revenue is recognized at a point in time when the facility is made available to the customer at the agreed consideration by the provision of specific address within the facility as maintained in the patient file. The receipt of consideration is assured as payment is required upfront.
F-14
Principal versus agency considerations
The Company follows the guidance provided in ASC 606, Revenue from Contracts with Customers, for determining whether the Company is the principal or an agent in arrangements with customers that involve another party that contributes to the provision of services to a customer. In these instances, the Company determines whether it has promised to provide the service itself (as principal) or to arrange for the specified service to be provided by another party (as an agent). This determination is a matter of judgment that depends on the facts and circumstances of each arrangement. The Company recognizes revenue from the performance of the procedures and treatment on a gross basis as the Company is responsible for the fulfillment, controls the delivery of the promised service, and has full discretion in establishing prices and therefore is the principal in the arrangement.
Contract related assets and liabilities are classified as current assets and current liabilities. Significant balance sheet accounts related to the revenue cycle are as follows:
Account receivables, net
Accounts receivable, net are stated at the original amount less an allowance for expected credit loss on such receivables. The allowance for expected credit loss is estimated based upon the Company’s assessment of various factors including historical experience, the age of the accounts receivable balances, current general economic conditions, future expectations and customer specific quantitative and qualitative factors that may affect the Company’s customers’ ability to pay. An allowance is also made when there is objective evidence for the Company to reasonably estimate the amount of probable loss.
Contract liabilities
Contract liabilities represent considerations received from customers in advance of satisfying the Company’s performance obligations under the contract. These amounts are expected to be earned within 12 months and are classified as current liabilities.
Expected credit loss
ASU No. 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments requires entities to use a current lifetime expected credit loss methodology to measure impairments of certain financial assets. Using this methodology will result in earlier recognition of losses than under the current incurred loss approach, which requires waiting to recognize a loss until it is probable of having been incurred. There are other provisions within the standard that affect how impairments of other financial assets may be recorded and presented, and that expand disclosures. Expected credit losses are probability-weighted estimates of credit losses. Credit losses are measured at the present value of all cash shortfalls (i.e., the difference between the cash flows due to the entity in accordance with the contract and the cash flows that the Company expects to receive). ECLs are discounted at the effective interest rate of the financial asset.
Retirement benefits
Retirement benefits in the form of mandatory government-sponsored defined contribution plans are charged to either expense as incurred or allocated to wages as part of cost of revenues.
Segment information
The Company determines its reportable segments using the management approach based on internal reporting used by the Chief Operating Decision Maker (“CODM”), comprising the Chief Executive Officer (CEO) and Chief Financial Officer (CFO), for decision-making, resource allocation, and performance assessment.
The Company does not distinguish revenues, costs, or expenses by segments, operational or geographical, but reports them in aggregate. Based on this assessment, management has determined that the Company operates as a single reportable segment under ASC 280. Accordingly, all required segment financial information is included in the consolidated financial statements. However, we segregate IVF revenue from surrogacy revenue as these two revenue types are critical to our business.
The Company’s CODM is Mr. Siu Wing Fund Alfred, its CEO. Geographic disclosures of long-lived assets and revenue from external customers as of December 31, 2024 and 2023 are presented in Note 15.
Leases
The Company measured the lease in accordance to ASU 2016-02, “Leases” (Topic 842). Lease terms used to calculate the present value of lease payments generally do not include any options to extend, renew, or terminate the lease, as the Company does not have reasonable certainty at lease inception that these options will be exercised. The Company generally considers the economic life of its operating lease ROU assets to be comparable to the useful life of similar owned assets. The Company has elected the short-term lease exception, therefore operating lease ROU assets and liabilities do not include leases with a lease term of months or less. Its leases generally do not provide a residual guarantee. The operating lease ROU asset also excludes lease incentives. Lease expense is recognized on a straight-line basis over the lease term.
F-15
Income Taxes
The Company recognizes deferred income tax assets or liabilities for expected future tax consequences of events recognized in the consolidated financial statements or tax returns. Under this method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and income tax bases of assets and liabilities and are measured using the income tax rates that will be in effect when the differences are expected to reverse. Valuation allowances are provided when it is more likely than not that a deferred tax asset is not realizable or recoverable in the future.
The Company determines that the tax position is more likely than not to be sustained and records the largest amount of benefit that is more likely than not to be realized when the tax position is settled. the Company recognizes interest and penalties, if any, related to uncertain tax positions in income tax expense.
Comprehensive Income
The Company presents comprehensive income in accordance with ASC Topic 220, Comprehensive Income. ASC Topic 220 states that all items that are required to be recognized under accounting standards as components of comprehensive income be reported in the consolidated financial statements. The components of comprehensive income were the net income for the years and the foreign currency translation adjustments.
Earnings per share
The Company computes earnings per share (“EPS”) following ASC Topic 260, “Earnings per share”. Basic EPS is measured as the income or loss available to common shareholders divided by the weighted average common shares outstanding for the period. Diluted EPS presents the dilutive effect on a per-share basis from the potential conversion of convertible securities or the exercise of options and or warrants; the dilutive impacts of potentially convertible securities are calculated using the as-if method; the potentially dilutive effect of options or warranties are computed using the treasury stock method. Potentially anti-dilutive securities (i.e., those that increase income per share or decrease loss per share) are excluded from diluted EPS calculation. There were no potentially dilutive securities that were in-the-money that were outstanding during the years ended December 31, 2024, 2023 and 2022.
Related parties
The Company adopted ASC 850, Related Party Disclosures, for the identification of related parties and disclosure of related party transactions.
Commitments and contingencies
In the normal course of business, the Company is subject to contingencies, including legal proceedings and claims arising out of the business that relate to a wide range of matters, such as government investigations and tax matters. The Company recognizes its liability for such contingency if it determines it is probable that a loss has occurred and a reasonable estimate of the loss can be made. The Company may consider many factors in making these assessments including historical and the specific facts and circumstances of each matter.
Non-controlling interests
Non-controlling interests are presented as a separate component of equity on the consolidated balance sheets and net (loss) income and other comprehensive loss are attributed to controlling and non-controlling interests respectively.
Concentration of risks
Concentration of credit risk
Financial instruments that potentially expose us to concentrations of credit risk consist primarily of cash and cash equivalents and account receivable. The Company places cash and cash equivalents with financial institutions with high credit ratings and quality.
Accounts receivable primarily comprise of amounts receivable from the service customers. The Company conducts credit evaluations of customers, and generally does not require collateral or other security from its customers. The Company establishes an allowance for doubtful accounts primarily based upon the factors surrounding the credit risk of specific customers. Furthermore, the risk is mitigated by ascertaining upfront payments for services prior to their performance.
F-16
Concentration of customers
As of December 31, 2024 and
2023, one and two customers respectively which individually contributed more than 10% of trade receivable, and accounted for and
None of the customers contributed more than 10% of revenue for years ended December 31, 2024 and 2023.
Concentration of suppliers
As of December 31, 2024 and
2023, nil and one supplier respectively which individually contributed more than 10% of trade payable, accounted for % and
For both the years ended December 31, 2024 and 2023, no vendor contributed more than 10% of total purchases of the Company.
Financial instruments
The Company’s financial instruments, including cash and cash equivalents, accounts receivables, net, deposits, other receivables and deferred IPO cost, net, loan to A SPAC I, accounts payables, accrued liabilities and other payables, and due from (to) shareholders, have carrying amounts that approximate their fair values due to their short maturities. ASC Topic 820, “Fair Value Measurements and Disclosures” requires disclosing the fair value of financial instruments held by the Company. ASC Topic 825, “Financial Instruments” defines fair value and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, accounts and other receivables, accounts and other payables, accrued liabilities and amounts due from (to) related parties each qualify as financial instruments and are a reasonable estimate of their fair values because of the short period between the origination of such instruments and their expected realization and their current market rate of interest. The three levels of valuation hierarchy are defined as follows:
| ● | Level 1 — inputs to the valuation methodology used quoted prices for identical assets or liabilities in active markets. |
| ● | Level 2 — inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets and information that are observable for the asset or liability, either directly or indirectly, for substantially the financial instrument’s full term |
| ● | Level 3 — inputs to the valuation methodology are unobservable and significant to the fair value measurement. |
The Company analyzes all financial instruments with features of both liabilities and equity under ASC 480, “Distinguishing Liabilities from Equity” and ASC 815.
F-17
Recently issued accounting pronouncements
The FASB has introduced expanded income tax disclosure requirements under ASU 2023-09 to improve transparency. Companies will now need to provide a detailed reconciliation of their effective tax rate, breaking down federal, state, and foreign taxes, as well as specific categories like tax credits and foreign earnings. Additionally, businesses must disclose income taxes paid by jurisdiction, offering investors greater clarity on tax obligations. These changes apply to both public and private companies, with annual reporting periods beginning after December 15, 2024 (2025 for calendar-year entities). This update aims to reduce ambiguity in tax reporting and align disclosures with investor needs.
A major shift in digital asset accounting, ASU 2023-08 requires companies to measure certain crypto assets (e.g., Bitcoin, Ethereum) at fair value rather than applying the previous impairment-only model. This means entities must recognize quarterly fair value adjustments in their financial statements, increasing volatility in reported earnings but improving transparency. The standard applies to fiscal years beginning after December 15, 2024, and impacts both corporate treasuries and investment firms holding cryptocurrencies. This change aligns GAAP closer to fair value accounting seen in other investment holdings, addressing criticisms of the old impairment approach.
Save for elsewhere disclosed, the Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the Company’s consolidated balance sheet, statement of operations and comprehensive income (loss) and statement of cash flows.
NOTE 3 — GOING CONCERN.
The accompanying consolidated financial statements have been prepared
assuming that the Company will continue as a going concern. The Company has generated a loss and suffered from an accumulated deficit
of $
The Company closely monitors
the market for opportunities and has also been carrying out various fundraising projects to improve the Company’s cash flow position.
As of this report date, all promissory notes as of December 31, 2024 have been settled, and convertible bonds comprising the Initial Note,
the First Mandatory Additional Note, and the Second Mandatory Additional Note, have been converted into shares in the Company. A further
$
The Company can make no assurance that required financings will be available for the amounts needed, or on terms commercially acceptable to the Company, if at all. If one or all of these events does not occur or subsequent capital raises are insufficient to bridge financial and liquidity shortfall, there would likely be a material adverse effect on the Company and its financial statements.
The consolidated financial statements do not reflect adjustments that would be necessary if the going concern basis was not appropriate. If the going concern basis was not appropriate for these consolidated financial statements, then adjustments would be necessary in the carrying value of the assets and liabilities, the reported revenues and expenses, and the balance sheet classifications used. These adjustments could be material.
F-18
NOTE 4 — ACCOUNTS RECEIVABLE, NET
Accounts receivable, net consists of the following:
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| Accounts receivable | $ | $ | ||||||
| Less: allowance for expected credit loss | ( | ) | ( | ) | ||||
| $ | $ | |||||||
As of the end of each of the financial year, the aging analysis of accounts receivable, net of allowance for expected credit loss, based on the invoice date is as follows:
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| Within 90 days | $ | $ | ||||||
| $ | $ | |||||||
The movement of allowances for expected credit loss is as follow:
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| Balance at beginning of the year | $ | ( | ) | $ | ( | ) | ||
| Reversal of expected credit losses | ||||||||
| Ending balance | $ | ( | ) | $ | ( | ) | ||
NOTE 5 — INVENTORIES
Inventories consist of the following:
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| Medicines, consumables and reagents for clinical and laboratory analyses | $ | $ | ||||||
| $ | $ | |||||||
NOTE 6 — DEPOSITS, PREPAYMENT, OTHER RECEIVABLES AND DEFERRED IPO COST, NET
Deposits, prepayment, other receivables and deferred IPO cost, net consist of the following:
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| Current | ||||||||
| Other receivables | $ | $ | ||||||
| Deposits | ||||||||
| Deferred initial public offering “IPO” cost | ||||||||
| Less: allowance for expected credit loss | ( | ) | ( | ) | ||||
| $ | $ | |||||||
| Deposit with a digital asset trading platform | $ | $ | ||||||
| Receivable from agents | $ | $ | ||||||
| Prepayments | $ | $ | ||||||
| Non-current | ||||||||
| Prepayment | $ | $ | ||||||
| $ | $ | |||||||
F-19
Included in prepayment is
an amount of $
The movement of allowances for expected credit loss is as follow:
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| Balance at beginning of the year | $ | ( | ) | $ | ( | ) | ||
| Reversal of provision (Provision) | ||||||||
| Ending balance | $ | ( | ) | $ | ( | ) | ||
NOTE 7 — PROPERTY AND EQUIPMENT, NET
Plant and equipment, net consist of the following:
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| At cost: | ||||||||
| Building improvement | $ | $ | ||||||
| Furniture and fixtures | ||||||||
| Medical instruments | ||||||||
| Motor vehicle | ||||||||
| Office equipment | ||||||||
| Less: accumulated depreciation | ( | ) | ( | ) | ||||
| Total | $ | $ | ||||||
Depreciation expenses for
the years ended December 31, 2024 and 2023 were $
impairment loss was recorded for the years ended December 31, 2024, and 2023.
NOTE 8 — ACCRUED LIABILTIES AND OTHER PAYABLES
Accrued liabilities and other payables consist of the following:
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| Accrued expenses | $ | $ | ||||||
| Customer deposit | ||||||||
| Withholding tax payable | ||||||||
| Independent director fee payable | ||||||||
| Compensation payable (Note 1) | ||||||||
| Other payables | ||||||||
| $ | $ | |||||||
| Note 1: |
F-20
NOTE 9 — CONTRACT LIABILITIES
Contract liabilities consist of the following:
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| Balance at beginning of year | $ | $ | ||||||
| Additions | ||||||||
| Recognized to revenue during the year | ( | ) | ( | ) | ||||
| Refund to customers (Note 1) | ( | ) | ||||||
| Balance at end of year | $ | $ | ||||||
| Note 1: |
NOTE 10 — CONVERTIBLE NOTES, PROMISSORY NOTES, DERIVATIVE LIABILITY AND WARRANTS
Convertible Notes
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| Convertible notes, at amortised cost are as follows: | ||||||||
| Convertible notes at amortised cost | $ | |||||||
| Less: Deferred debt issuance cost | $ | |||||||
| Convertible notes, net | $ | |||||||
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| The convertible notes are repayable as follows: | ||||||||
| Current liability | $ | |||||||
| Non-current liability | ||||||||
| Total | $ | |||||||
As of December 31, 2024, the Company had the following outstanding convertible notes:
| Principal | Conversion | Coupon | Issuance | Maturity | ||||||||||
| Note Holders | Amount | Price | Rate | Date | Date | |||||||||
| JAK & affiliated holders | $ | % | ||||||||||||
| JAK & affiliated holders | % | |||||||||||||
| JAK & affiliated holders | % | |||||||||||||
| JAK & affiliated holders | % | |||||||||||||
| Total | ||||||||||||||
During the year ended December 31, 2024, a total
of $
F-21
As of December 31, 2024,
$
The effective interest expense calculated at
The transaction costs incurred on issuance of the Notes are capitalized and amortised over the term of the Notes as follows:
| Transaction costs on issuance of Notes | December 31, | |||||||
| 2024 | 2023 | |||||||
| Balance at beginning of the year | $ | $ | ||||||
| Add: capitalized during the year | ||||||||
| Less: amortized during the year | ( |
) | ||||||
| Ending balance | $ | $ | ||||||
The following table sets forth the Company’s contractual obligations as of December 31, 2024 relating to the convertible notes:
| 2024 | ||||
| Convertible bonds- | ||||
| 2025 | ||||
| 2026 | ||||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| Total | ||||
Promissory Notes
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| Balance at beginning of the year | $ | $ | ||||||
| Issued during the year | ||||||||
| Waiver of liability | ||||||||
| Ending balance | $ | $ | ||||||
As of December 31, 2024,
the Company has outstanding non-interest-bearing unsecured promissory notes with a total principal balance of US$
Derivative liability
Pursuant to ASC 815, a derivative liability had arisen from the issuance of convertible bonds which have the option of being converted to or exchanged for Class A ordinary shares at any time from date of issuance. The derivative liability is assessed to be a debt requiring to be bifurcated from the host contract and recorded at the fair value.
However, the conversion
to ordinary shares is subject to certain terms and criteria as set within the Agreement, which includes restriction of conversion if the
shareholdings by the note holder before and after the conversion exceeds
Free standing instruments – warrants
The convertible bond agreements as mentioned above
granted the note holders
The exercise of these warrants
is subject to a
F-22
NOTE 11 — LEASES
The Company has various operating
leases for clinics and office spaces. The lease agreements do not specify an explicit interest rate. The Company’s management believes
that the interest rate of
As of December 31, 2024 and 2023, the right-of-use assets
totaled $
As of December 31, 2024 and 2023, lease liabilities consist of the following:
| December 31, | ||||||||
| Operating lease | 2024 | 2023 | ||||||
| Lease liabilities – current portion | $ | $ | ||||||
| Lease liabilities – non-current portion | ||||||||
| Total | $ | $ | ||||||
| December 31, | ||||||||
| Finance lease | 2024 | 2023 | ||||||
| Lease liabilities – current portion | $ | $ | ||||||
The following is a schedule of future minimum payments under operating leases as of December 31, 2024:
| December 31, 2024 | ||||
| Not later than 1 year | $ | |||
| Between 1 to 2 years | ||||
| - | ||||
| Total lease payments | ||||
| Less: imputed interest | ( | ) | ||
| Total operating lease liabilities, net of interest | $ | |||
Other lease information is as follows:
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| Weighted-average discount rate – operating leases | % | % | ||||||
| Short term lease cost | $ | $ | ||||||
As of December 31, 2024 and
2023, there were $
NOTE 12 — EQUITY
Ordinary shares
As at December 31, 2023
and December 31, 2024, the Company is authorized to issue
The equity of the Company
as of December 31, 2024 and 2023 represents
F-23
Additional paid-in capital
| Balance as at January 1,2023 | $ | |||
| Issuance of shares as compensation for services (Note 1) | ||||
| Balance as at December 31, 2023 | ||||
| Issuance of shares through Equity Line of Credit (Note 2) | ||||
| Issuance of shares through conversion of convertible notes | ||||
| Decrease in subscription receivable due to reduction of work by professionals (Note 1) | ( | ) | ||
| Business Combination (Note 3) | ( | ) | ||
| Balance as at December 31, 2024 | $ |
| * | - the number of shares below have been amended to apply the reverse stock split in February 2025 retrospectively. |
| Note 1: |
| Note 2: | On November 21,
2024, the Company entered into a Common Shares Purchase Agreement (the “White Lion Purchase Agreement”) with White Lion Capital,
LLC (“White Lion”) and a related Registration Rights Agreement (the “RRA”). Pursuant to the White Lion Purchase
Agreement, the Company has the right, but not the obligation, to require White Lion to purchase, within 36 months from the Agreement
effective date up to One Hundred Million Dollars ($ |
On December 10, 2024,
| Note 3: |
NOTE 13 — EMPLOYEE BENEFIT PLANS
HK SAR
The Company has a defined
contribution pension scheme for its qualifying employees. The scheme assets are held under a provident fund managed by an independent
fund manager. The Company and its employees are each required to make contributions to the scheme calculated at
Thailand
The Company is obliged to
make social security payments within the first 15 days of the month over which it is accrued. In 2024, the Company and its employees
are each required to make contributions to the scheme calculated at
Cambodia
Every business employing one or more workers must register its business and workers with the National Social Security Fund (the “NSSF”) for the Occupational Risk Scheme (for work-related accidents and occupational diseases), the Health Care Scheme and the Pension Scheme.
Once registered, the business must pay to the NSSF:
| ● | A monthly contribution equivalent to |
| ● | A monthly contribution equivalent to |
| ● | A monthly contribution to the compulsory Pension Scheme, which is jointly paid by the employer and the employee at the same rate of |
F-24
Kyrgyzstan
The Company has a defined
contribution pension scheme for its qualifying employees. The scheme assets are held under a provident fund managed by an independent
fund manager. The Company and its employees are each required to make contributions to the scheme calculated at
NOTE 14 — PROVISION FOR INCOME TAXES
Cayman Islands
NewGenIvf Limited was incorporated in the Cayman Islands and is not subject to tax on income or capital gains under current Cayman Islands law. In addition, upon payment of dividends by these entities to the shareholders, no Cayman Islands withholding tax will be imposed.
HK SAR
Accordingly, the HK SAR profits
tax is calculated at
Thailand
The companies incorporated
in Thailand are taxed on worldwide income. A company incorporated abroad is taxed on its profits arising from or in consequence of the
business carried on in Thailand. The corporate income tax (CIT) rate is
Cambodia
The standard rate of corporate
income tax (“CIT”) for companies and permanent establishments who are classified as medium and large taxpayers is
Kyrgyzstan
The company is subject to
a corporate income tax on their aggregate annual income earned worldwide. Non-resident legal entities carrying out business activities
through a permanent establishment in Kyrgyzstan are subject to profit tax on the income attributed to the activities of that permanent
establishments. During the year, excess tax payable of $
Profit tax is calculated
at a rate of
Significant components of the provisions for income taxes for the year ended December 31, 2024, and 2023 were as follows:
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| Current tax provision Kyrgyzstan | $ | $ | ||||||
| Over provision of tax in prior year Kyrgyzstan | ( | ) | ||||||
| Current tax provision Cambodia | ||||||||
| Total tax (income) expense | $ | ( | ) | $ | ||||
F-25
| December 31, | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| (Loss) Income before taxes | $ | ( | ) | $ | $ | |||||||
| Tax credit (expense) at the effective tax rates | ( | ) | ( | ) | ||||||||
| Tax effect on non-taxable income | ( | ) | ( | ) | ||||||||
| Tax effect on non-deductible expenses | ||||||||||||
| Change in valuation allowance | ||||||||||||
| Tax effect on utilization of tax losses | ( | ) | ( | ) | ||||||||
| Tax losses unable to be utilized | ||||||||||||
| Over provision of tax in prior year | ( | ) | ||||||||||
| Tax (income) expense | $ | ( | ) | $ | $ | |||||||
Deferred tax asset, net
Significant components of deferred tax assets, net were as follows:
| December 31, 2024 | December 31, 2023 | |||||||
| USD | USD | |||||||
| Deferred tax assets: | ||||||||
| – Net operating loss carry forward | ||||||||
| Less: valuation allowance | ( | ) | ( | ) | ||||
| Deferred tax assets, net | ||||||||
As of December 31, 2024 and
2023, the Company had net operating loss carry forward of $
NOTE 15 — DISAGGREGATED REVENUES
The Company’s main business operations are to provide: (i) IVF treatment service; and (ii) surrogacy and ancillary caring services.
| For the year ended December 31, | ||||||||||||
| Revenue from external customers | 2024 | 2023 | 2022 | |||||||||
| IVF treatment service | $ | $ | $ | |||||||||
| Surrogacy, ancillary caring and other services | ||||||||||||
| Total revenues | $ | $ | $ | |||||||||
Geographical information
| December 31, | ||||||||||||
| Revenue from external customers originated from | 2024 | 2023 | 2022 | |||||||||
| HK SAR | $ | $ | ||||||||||
| Kyrgyzstan | ||||||||||||
| Cambodia | ||||||||||||
| Thailand | ||||||||||||
| Total revenues | $ | $ | ||||||||||
The revenue information above is based on the locations where the revenue originated.
F-26
| December 31, | ||||||||||||
| Long-lived assets located at | 2024 | 2023 | 2022 | |||||||||
| HK SAR | $ | $ | ||||||||||
| China | ||||||||||||
| Kyrgyzstan | ||||||||||||
| Cambodia | ||||||||||||
| Thailand | ||||||||||||
| $ | $ | |||||||||||
The Company’s long-lived assets consist of plant and equipment, net and operating leases right-of-use assets, net.
NOTE 16 — RISKS
A. Credit risk
Accounts receivable
In order to minimize the
credit risk, the management of the Company monitors and ensures that follow-up action is taken to recover overdue debts. The Company
considers the probability of default upon initial recognition of asset and whether there has been a significant increase in credit risk
on an ongoing basis throughout each reporting period. To assess whether there is a significant increase in credit risk, the Company compares
the risk of a default occurring on the asset as at the reporting date with the risk of default as at the date of initial recognition.
It considers available reasonable and supportive forward-looking information, such as GDP growth rate and nominal GDP per capita.
Based on the impairment assessment performed by the Company, the directors consider the loss allowance for account receivables as of December
31, 2024 and 2023 to be $
Cash and cash equivalents
The credit risk on liquid funds is limited because the counterparties are banks with high credit ratings assigned by international credit-rating agencies. The Company is exposed to concentration of credit risk on liquid funds which are deposited with several banks with high credit ratings.
Deposits and other receivables, amount due from shareholders and loan to A SPAC I
The Company assessed the
impairment for deposits and other receivables, due from shareholders individually based on internal credit rating and ageing of these
debtors which, in the opinion of the directors, have no significant increase in credit risk since initial recognition. Based on the impairment
assessment performed by the Company, the directors consider the loss allowance for deposits and other receivables, due from shareholders
as of December 31, 2024 is $
B. Interest risk
Cash flow interest rate risk
The Company is exposed to cash flow interest rate risk through the changes in interest rates related mainly to the Company’s variable-rates bank balances.
The Company currently does not have any interest rate hedging policy in relation to fair value interest rate risk and cash flow interest rate risk. The directors monitor the Company’s exposures on an ongoing basis and will consider hedging the interest rate should the need arises.
F-27
Sensitivity analysis
The sensitivity analysis
below has been determined by assuming that a change in interest rates had occurred at the end of the reporting period and had been applied
to the exposure to interest rates for financial instruments in existence at that date.
If interest rates had been
Foreign currency risk
Foreign currency risk is the risk that the holding of foreign currency assets will affect the Company’s financial position as a result of a change in foreign currency exchange rates.
The Company’s monetary assets and liabilities are mainly denominated in HK$, THB and RMB which are the same as the functional currencies of the relevant group entities. Hence, in the opinion of the directors of the Company, the currency risk of US$ is considered insignificant. The Company currently does not have a foreign currency hedging policy to eliminate currency exposures. However, the directors monitor the related foreign currency exposure closely and will consider hedging significant foreign currency exposures should the need arise.
C. Economic and political risks
The Company’s operations are mainly conducted in Thailand, Cambodia and Kyrgyzstan. Accordingly, the Company’s business, financial condition, and results of operations may be influenced by changes in the political, economic, and legal environments in Thailand, Cambodia and Kyrgyzstan.
The Company’s operations in Thailand, Cambodia and Kyrgyzstan are subject to special considerations and significant risks. These include risks associated with, among others, the political, economic and legal environment and foreign currency exchange. The Company’s results may be adversely affected by changes in the political and social conditions in Thailand, Cambodia and Kyrgyzstan, and by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion, remittances abroad, and rates and methods of taxation, among other things including natural disasters and wars.
D. Inflation risk
Management monitors changes in prices levels. Historically inflation has not materially impacted the Company’s consolidated financial statements; however, significant increases in the price of labor that cannot be passed to the Company’s customers could adversely impact the Company’s results of operations.
NOTE 17 — RELATED PARTY BALANCES AND TRANSACTIONS
The summary of amount due from and due to related parties as the following:
| December 31, | ||||||||||
| Relationship | 2024 | 2023 | ||||||||
| Due from shareholders consist of the following: | ||||||||||
| Mr. Siu Wing Fung, Alfred (“Mr. Siu”) | $ | $ | ||||||||
| Due to a related party consist of the following: | ||||||||||
| Ms. Fong Hei Yue, Tina (“Ms. Fong”) | ( | ) | ||||||||
| Harcourt Limited | $ | ( | ) | $ | ||||||
Note:
| (1) |
| (2) |
F-28
The balance due from shareholders consist of the following:
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| Due from/ (to)shareholders/ related party | $ | ( | ) | $ | ||||
| Less: allowance for expected credit loss | ( | ) | ||||||
| $ | ( | ) | $ | |||||
The movement of allowances for expected credit loss is as follow:
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| Balance at beginning of the year | $ | ( | ) | $ | ( | ) | ||
| Reversal of Provision/(Provision) | ( | ) | ||||||
| Ending balance | $ | $ | ( | ) | ||||
In addition to the transactions and balances detailed elsewhere in these consolidated financial statements, the Company had the following transactions with related parties:
| December 31, | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Directors’ remuneration to Mr. Siu Wing Fung, Alfred | $ | $ | $ | |||||||||
| Directors’ remuneration to Ms. Fong Hei Yue, Tina | ||||||||||||
| Waiver of related party balance of Mr. Siu Wing Fung, Alfred | ( | ) | ||||||||||
NOTE 18 — LOAN TO A SPAC I
On June 12, 2023, NewGenIvf
Limited (the “Legacy NewGenIvf”) and A SPAC I Acquisition Corp (“A SPAC I”) entered into a First Amendment
to Merger Agreement, pursuant to which the Legacy NewGenIvf agreed to provide non-interest bearing loans in an aggregate principal
amount of up to $
NOTE 19 — COMMITMENTS & CONTINGENCIES
As of December 31, 2024 and 2023, the Company was not a party to any legal or administrative proceedings. As of December 31, 2024, the Company had commitment as described in Notes 10 and 11 to the financial statements.
The Company is also committed to honor its obligations pursuant to the convertible note agreements as described in Note 10.
F-29
NOTE 20 — DISPOSAL OF SUBSIDIARY
On December 18, 2024, the
Company completed the sale of its First Fertility Bishkek LLC to an unrelated third party for total consideration of US$
As part of the disposal, all the outstanding account payables and receivables as well as all outstanding balances between the First Fertility Bishkek LLC and Harcourt, FFPGS, and the Director were transferred to the Seller. Any tax liabilities in Kyrgyzstan arising from the transfer of these balances shall be borne by the Buyer.
The following table summarizes the financial impact of the disposal:
| ● | Consideration received: Cash of $ |
| ● | Net assets acquired of $ |
| ● | Reversal of excess tax of $ |
The disposal was accounted for in accordance with ASC 810, Consolidation.
As a result, the Company deconsolidated First Fertility Bishkek LLC and recognized a write back of tax (after netting against the cash
consideration received) in the amount of US$
The disposal did not represent a strategic shift and, therefore, was not classified as a discontinued operation under ASC 205-20.
NOTE 21 — BUSINESS ACQUISITION
On December 17, 2024, the Company acquired Bi
Clinic Ltd (“Bi Clinic”), which holds a license for the provision of IVF treatment, surrogacy, and ancillary caring services,
for total consideration of $
At the acquisition date, Bi Clinic had not yet commenced revenue-generating activities but had established the necessary regulatory approvals and licensing framework to operate as an IVF and surrogacy service provider. These approvals, along with the Company’s planned integration of medical personnel and operational processes, provide the necessary inputs and substantive processes required to meet the definition of a business under ASC 805.
Since Bi Clinic had no other assets or liabilities, the entire purchase price was allocated to intangible assets, specifically the IVF license and regulatory approvals. No goodwill was recognized in connection with the transaction.
As Bi Clinic had no prior operations, its financial results have been included in the consolidated financial statements from the acquisition date, with no historical revenue or expenses impacting the Company’s consolidated results. Pro forma financial information has been omitted, as the acquisition is not considered material to the Company’s financial results.
NOTE 22 — SUBSEQUENT EVENTS
The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the financial statements were issued. Based upon this review, other than as described below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the financial statements.
On February 11, 2025, the
Company carried out a
On February 24, 2025, the
Company entered into a Consulting Services Agreement with A SPAC (Holdings) Group Corp (“ASPAC”), pursuant to which the Company
engaged ASPAC for the provision of certain consulting services. It was agreed that the Company would provide consideration in the form
of cash and shares. On March 3, 2025, the Company issued the
On February 27, 2025, the
Company received a confirmation from Nasdaq that its application to transfer its listing to the Nasdaq Capital Market had been approved
and that the Company’s securities were transferred to the Nasdaq Capital Market at the opening of business on February 28, 2025.
On March 10, 2025, the Company received a confirmation letter from Nasdaq confirming that it has demonstrated compliance with all of Nasdaq’s
listing requirements, including shareholder equity of more than $
F-30
On February 28, 2025, the
Company completed its acquisition of the MicroSort technology from Genetics & IVF Institute, Inc. (“GIVF”). Pursuant to
a Purchase Agreement dated January 21, 2025 between the Company and GIVF (“Purchase Agreement”), the Company purchased all
of the Assets (as defined in the Purchase Agreement) and IP Licenses (as defined in the Purchase Agreement) relating to the MicroSort
technology from GIVF for a cash consideration of $
On February 18, 2025, the Company entered into a cooperation agreement with FERTILITY GROUP LLC (“BOBCARE”) to jointly develop fertility services in the Kyrgyzstan market. The collaboration aims to combine NewGen’s technical expertise in fertility treatments with BOBCARE’s market resources in the region. This strategic partnership is anticipated to contribute to NewGen’s market presence over the next three years, improving the competitive position of both parties in the Kyrgyzstan market. Both companies will work together on several initiatives, including enhancing clinical protocols and patient management systems, knowledge exchange between fertility specialists, coordinated marketing and brand-building activities in Kyrgyzstan, and developing specialized fertility treatment options for the regional market.
On March 31, 2025, the Company terminated the binding term sheet with healthcare company European Wellness Investment Holdings Limited (“EWIHL”) regarding their previously announced reverse merger transaction. On the grounds of non fulfilment of certain criteria as contained in the term sheet.
On March 31, 2025, the Company’s Board approved certain amendments
to its Share Incentive Plan of 2024, the awards of which are valid for a period of
On April 1, 2025, the Company
entered into a new Securities Purchase Agreement (“2025 Securities Purchase Agreement”) with JAK, pursuant to which, amongst
other things: (i) the Company agreed to sell, at an initial closing, a senior convertible note in the aggregate original principal amount
not exceeding $
On April 2, 2025, the Company
consummated the fourth tranche of its debt financing under the terms of its existing Securities Purchase Agreement with the investor, At
the closing of the fourth tranche, the Company sold to the investor a senior convertible note in the principal amount of $
Mr. Yip Eng Jeremy Foo, a director of NewGenIvf Group Limited (the “Company”), has resigned from the Board of Directors of the Company, the Audit Committee of the Company, and the Compensation Committee of the Company due to personal reasons, effective April 4, 2025. Mr. Foo’s resignation did not result from any disagreement with the Board or the Company on any matter relating to the Company’s operations, policies or practices.
Ms. Florianna Ann Chi Wan Chan will be appointed as a director of the Company, effective April 15, 2025, to fill the vacancy on the Audit Committee and the Compensation Committee created by Mr. Foo’s resignation. Ms Chan has over 20 years of experience in project management, real estate development, and luxury hospitality, and is a proven leader in driving growth and operational excellence. Since 2015, Ms. Chan has led Lab Concept Company Limited, a subsidiary of The Lane Crawford Joyce Group, where she successfully restructured operations, spearheaded rebranding, and digitized processes, achieving significant revenue growth. Previously, she held senior roles at VCC Company Limited, Eton Properties, and Crown Macau, excelling in real estate development, marketing, and VIP services. She holds a Bachelor of Hospitality Management from Central Queensland University in Australia and an Advanced Diploma from William Angliss Institute of TAFE. Fluent in Cantonese, Mandarin, and English, Ms. Chan brings a deep understanding of Asia Pacific markets and a strategic vision that will drive the Company’s continued growth and success.
F-31
On April 15, 2025, the Board
of Directors approved another reverse stock split of all of the Company’s issued and unissued shares, including the Class A ordinary
shares with no par value (the “Class A Ordinary Shares”), Class B ordinary shares with no par value and preferred shares with
no par value, at an exchange ratio of one (1) share for ten (10) shares. The Company expects that the Reverse Stock Split will become
effective on or around May 2, 2025, and that its Class A Ordinary Shares will begin trading on the Nasdaq Capital Market (“Nasdaq”)
on a post-Reverse Stock Split basis on such date. The Reverse Stock Split is intended for the Company to remain compliant with a minimum
bid price of $
No fractional shares will be issued in connection with the Reverse Stock Split. Instead, the Company will issue one full post-Reverse Stock Split Class A Ordinary Share to any shareholder at a participant level who would have been entitled to receive a fractional share as a result of the process. After the Reverse Stock Split, all options, warrants and other convertible securities of the Company outstanding immediately prior to the Reverse Stock Split will be adjusted by dividing the number of Class A Ordinary Shares into which the options, warrants and other convertible securities are exercisable or convertible by ten (10) in accordance with the terms of the plans, agreements or arrangements governing such options, warrants and other convertible securities and subject to rounding to the nearest whole share.
Subsequent to the year end
and to the date of this report, $
Other than the events mentioned above, there have been no other subsequent events noted till the date of these financial statements.
NOTE 23 — RECLASSIFICATION AND COMPARATIVE FIGURES
Certain prior year amounts have been reclassified to conform to the current year’s presentation. These include the re-presentation of share-based compensation to consultants pursuant to service agreements. In the prior year, compensation for future services to be rendered were recorded as subscription receivables in the Statement of Equity. In the current year, these compensation for services has been reclassified and measured at the fair value of the shares issued as compensation at grant date in accordance with ASC 718. This reclassification had no effect on previously reported net income.
The comparative figures in the consolidated balance sheets, statement of equity, consolidated statements of cash flows, together with the accompanying notes, where relevant reflect those of the Company after the reverse takeover and reorganization process in 2024, and accordingly differs from those audited and reported on by the predecessor auditor on NewGenIvf Limited, the legal acquiree and accounting acquirer, arising from the application of ASC 805, which requires retrospective application. The difference mainly impacts the equity in the consolidated balance sheets, the statement of equity and the consolidated statements of cash flows, including the relevant notes.
F-32