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CENTR Brands Corp. — Management Reports 2025
Oct 16, 2025
47065_rns_2025-10-15_9771fc34-51ba-48f4-96cc-740b1a6adf27.pdf
Management Reports
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CENTR BRANDS CORP.
507-837 West Hastings Street
Vancouver, BC V6C 3N6
October 15, 2025
MANAGEMENT DISCUSSION & ANALYSIS
This Management’s Discussion & Analysis (“MD&A”) should be read in conjunction with the condensed interim consolidated financial statements of CENTR Brands Corp. (the “Company”) for the three months ended August 31, 2025 and related notes, which have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) applicable to the preparation of financial statements. All amounts in the financial statements and this MD&A are expressed in United States dollars, unless otherwise indicated.
Further information about the Company, its operations and other continuous disclosure is available through filings with the securities regulatory authorities in Canada under the Company’s profile at www.sedar.com.
FORWARD LOOKING INFORMATION
This MD&A contains certain forward-looking statements and information relating to the Company that are based on the beliefs of management of the Company as well as assumptions made by and information currently available to the Company. When used in this document, the words “anticipate”, “believe”, “estimate”, “expect” and similar expressions, as they relate to the Company or management of the Company, are intended to identify forward-looking statements. This MD&A contains forward-looking statements relating to, among other things, regulatory compliance, the sufficiency of current working capital, and the estimated cost and availability of funding for the continued development of the Company’s beverages. These statements speak only as at the date they are made and are based on information currently available and on the then-current expectations of the party making the statement and assumptions concerning future events, which are subject to a number of known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from that which was expressed or implied by such forward-looking statements, including, but not limited to, risks and uncertainties related to: the performance of the Company’s business and operations; the intention to grow the business and operations of the Company; applicable laws, regulations and any amendments thereof; the competitive and business strategies of the Company; the general economic, financial market, regulatory and political conditions in which the Company operates; risks associated with economic conditions, dependence on management; and other risks described in this MD&A and described from time to time in documents filed by the Company with Canadian securities regulatory authorities. Many factors could cause the actual results, performance or the Company’s achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements.
The forward-looking statements contained herein are based on certain key expectations and assumptions, including, but not limited to, expectations and assumptions concerning the success of the operations of the Company. Although the Company believes that the expectations and assumptions on which such forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements, because no assurance can be given that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to the risks described above and other factors beyond the Company's control. Consequently, all forward-looking statements made in this MD&A are qualified by such cautionary statements and there can be no assurance that the anticipated results or developments will actually be realized or, even if realized, that they will have the expected consequences to or effects on the Company. The cautionary statements contained or referred to in this MD&A should be considered in connection with any subsequent written or oral forward-looking statements that the Company and/or persons acting on its behalf may issue. The Company does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, other than as required by law.
Overview
The Company was formed under the British Columbia Business Corporations Act (“BCBCA”) on September 26, 2012. On October 18, 2022, the Company dissolved CBD Lifestyle Corp., a wholly-owned subsidiary of the Company.
The Company is involved in the development and marketing of non-alcoholic, functional beverages. The Company produced CENTR Enhanced, a refreshing, ZERO calorie, nootropic and adaptogen, sparkling functional beverage incorporating a variety of science-backed ingredients. Utilizing the Company’s intellectual property, the Company is currently exploring strategic business alternatives in response to shifting economic conditions.
Overall Performance
On December 18, 2023, the Company announced it had ceased funding its United States operations which included its United States subsidiaries, CENTR Brands USA LLC and CENTR Enhanced USA LLC. After reviewing the overall performance of the Company’s United States operations, in particular its cash position and its forecasted revenue and expenses, it was decided to consolidate the Company’s ongoing operations into Canada and review the various alternatives available in an effort to ensure the long-term success of the Company.
See “Forward Looking Information”.
Discussion of Operations
Utilizing the Company’s intellectual property, the Company is currently exploring strategic business alternatives in response to shifting economic conditions.
Summary of Quarterly Results (expressed in Canadian dollars)
| Description | Q1 2026 | Q4 2025 | Q3 2025 | Q2 2025 |
|---|---|---|---|---|
| Net loss and comprehensive net loss for the period | (37,823) | (13,366) | (163,880) | (189,014) |
| Basic and diluted loss per share | (0.00) | (0.00) | (0.01) | (0.02) |
| Description | Q1 2025 | Q4 2024 | Q3 2024 | Q2 2024 |
| --- | --- | --- | --- | --- |
| Net income (loss) and comprehensive net income (loss) for the period (1) | (67,328) | 45,643 | (507,829) | (1,981,710) |
| Basic and diluted income (loss) per share | (0.01) | 0.00 | (0.04) | (0.17) |
(1) Net income (loss) and comprehensive net income (loss) for the period includes the following non-cash gains:
a. Q3 2024 – gain of $28,135 for the revaluation of warrants as a liability for accounting purposes.
b. Q2 2024 – gain of $378,771 for the revaluation of warrants as a liability for accounting purposes.
Results of Operations (expressed in Canadian dollars)
The operating results for the three-month period ended August 31, 2025 reflect the ceased funding of the Company’s United States operations and termination of all its employees as noted in the “Overall Performance”.
For the three-month period ended August 31, 2025 (Q1 2026)
| Selected Financial Results | August 31, 2025 (three months) | August 31, 2024 (three months) |
|---|---|---|
| Net loss and comprehensive net loss | (37,823) | (67,328) |
| Income from discontinued operations | 64 | 82,673 |
| Continuing operations: | ||
| Loss from continuing operations | (37,887) | (150,001) |
| General and administrative expenses | 37,887 | 146,745 |
Liquidity and Capital Resources (expressed in Canadian dollars)
As of August 31, 2025, the Company had a cash position of $76,221 and a negative working capital of $1,680,691.
The Company's objective is to maintain a capital structure that supports its long-term growth strategy, maintains creditor and customer confidence, and maximizes shareholder value. However, the Company discloses that current capital has been exhausted. As such, the Company is considering strategic alternatives to optimize the capital structure, including the assumption of debt. There were no changes in the Company’s approach to capital management during the three-month period ended August 31, 2025. During fiscal 2026, the Company will continue to aggressively pursue both equity and debt alternatives in the capital markets.
Transactions with Related Parties (expressed in Canadian dollars)
The Company transacts with key individuals from management who have authority and responsibility to plan, direct, and control the activities of the Company. Key management personnel are defined as the executive officers of the Company and the directors, including the Chief Executive Officer and Chief Financial Officer.
The Company entered into certain transactions with key management personnel during the three-month period ended August 31, 2025 as follows:
| Three months ended August 31, 2025 | Three months ended August 31, 2024 | |
|---|---|---|
| Salaries and benefits | $ - | $ 60,000 |
| Director fees | - | 30,736 |
| $ - | $ 90,736 |
The Company incurred the following transactions with companies having a director and officer in common:
| Three months ended August 31, 2025 | Three months ended August 31, 2024 | |
|---|---|---|
| Other fees | ||
| Harbour Pacific Capital Corporation (1) | $ 2,700 | $ 2,700 |
| $ 2,700 | $ 2,700 |
(1) Harbour Pacific Capital Corporation is a company controlled by Anton J. Drescher, a director and officer of the Company.
As at August 31, 2025, $422,328 was included in due to related parties for salaries, director fees and other overhead costs in the ordinary course of business. These amounts bear no interest and are due on demand.
As at August 31, 2025, $213,507 was included in convertible debentures for unsecured convertible debentures issued to a shareholder and a director and officer of the Company in the ordinary course of business.
Financial Instruments
Fair Value of Financial Instruments
The fair value of cash, accounts receivable, accounts payable and accrued liabilities, due to related parties and loans payable approximate their carrying value due to their immediate or short-term nature, unless otherwise noted.
Fair Value Hierarchy
Financial instruments recorded at fair value on the Statement of Financial Position are classified using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels:
- Level 1 – valuation based on quoted prices (unadjusted) in active markets for identical assets or liabilities;
- Level 2 – valuation techniques based on inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and
- Level 3 – valuation techniques using inputs for the asset or liability that are not based on observable market data (unobservable inputs).
The fair value hierarchy requires the use of observable market inputs whenever such inputs exist. A financial instrument is classified to the lowest level of the hierarchy for which a significant input has been considered in measuring fair value. The fair value of cash, accounts receivable, warrants liability, accounts payable and accrued liabilities, due to related parties and loans payable are measured using a level 2 technique.
The Company’s risk exposures and the impact on the Company’s financial instruments are summarized below:
Credit Risk
Credit risk arises from the potential that a counterparty will fail to perform its obligations. The carrying value of the Company’s cash and accounts receivable, totaling $80,219, represents the Company’s maximum exposure to credit risk. The Company does not believe it has significant credit risk associated with its cash as such funds are on deposit with highly rated financial institutions and thus credit risk arises principally from the Company’s receivables from customers. The Company’s exposure to credit risk on accounts receivable is influenced mainly by the individual characteristics of each debtor. The Company has a number of customers with small accounts receivable balances and is therefore able to monitor credit risk on an individual account basis.
Currency Risk
Currency risk is the risk to the Company’s earnings that arises from fluctuations in foreign exchange rates and the degree of volatility of those rates. The Company is exposed to currency risk by incurring certain expenditures in United States dollars.
Interest Rate Risk
Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company does not have financial instruments that results in material exposure.
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Liquidity Risk
Liquidity risk is the risk that the Company may encounter difficulty in raising funds to meet its financial commitments or can only do so at excessive cost. The Company cannot ensure there is sufficient liquidity to meet its short-term business requirements, taking into account its anticipated cash flows from operations, its holdings of cash and its ability to raise funds from its existing shareholders or external shareholders. The Company is exploring strategic alternatives to its current capital structure to ensure it can operate effectively and meet its financial obligations when they come due.
Directors and Officers
The Company’s Board of Directors are as follows:
Robert W. C. Becher
Anton J. Drescher
Jeffrey Holmgren
The Company’s officers are as follows:
Robert W.C. Becher Chief Executive Officer
Anton J. Drescher Interim Chief Financial Officer
Share Capital
The authorized share capital of the Company consists of an unlimited number of common shares without par value. As of October 15, 2025, 11,623,386 common shares were issued and 11,597,740 common shares were outstanding.
Shares Issued
During the three-months ended August 31, 2025, the Company did not issue any common shares.
Outstanding Balances
As of October 15, 2025, 1,000 restricted share units were outstanding with an expiry date of February 2026.
As of October 15, 2025, 165,154 deferred share units were outstanding.
As of October 15, 2025, 2,490,220 share purchase warrants were outstanding at exercise prices of $5.00 to $10.00 with expiry dates of March 2026 to May 2026.
Contingencies
The Company may be subject to claims that arise in the ordinary course of business. Management assesses the likelihood of adverse outcomes in these matters, as well as potential ranges of losses, to determine appropriate accounting treatment and disclosure. The Company accrues liabilities for legal claims when it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated.
As of the date of this MD&A, the Company is not aware of any outstanding claims made against the Company.
Critical Accounting Estimates, Policies and Risk Matters
Use of Estimates and Judgment
The preparation of consolidated financial statements in conformity with IFRS requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses that are not readily apparent from other sources, during the reporting period. These estimates and associated assumptions are based on historical experience and other relevant factors. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised if the revision affects only that period, or in the period of the revision and in any future periods affected.
Significant judgment, estimates and assumptions that have the most significant effect on the amounts recognized in the Company's consolidated financial statements are as follows:
(i) Share-based payments, warrants and warrant liability:
To calculate the fair value of stock options, restricted share units and warrants, the Company uses the Black-Scholes option pricing model. This inherently requires management to make various estimates and assumptions, primarily in relation to the expected volatility, stock option life and forfeiture rates. Changes in these estimates could cause a significant change in the share-based compensation expense, share-based payment reserve and warrant liability in a given period.
(ii) Determination of functional currency:
Based on the primary indicators in IAS21 – The Effects of Change in Foreign Exchange Rates – the Canadian dollar has been determined as the presentation currency of the Company and all subsidiaries, as the Canadian dollar was the currency in which the activities were carried out. Effects of changes in foreign exchange rates are recorded as foreign exchange gain (loss) on the consolidated statements of net loss and comprehensive loss.
(ii) Income taxes:
Income tax on the profit or loss for the periods presented comprises current and deferred tax. Income tax is recognized in profit or loss except to the extent that it relates to items recognized directly in equity, in which case it is recognized in equity.
Current tax expense is the expected tax payable on the taxable income for the period, using tax rates enacted or substantively enacted at period end, adjusted for amendments to tax payable with regards to previous years.
Deferred tax is provided using the liability method, providing for temporary difference between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The following temporary differences are not provided for: goodwill not deductible for tax purposes and the initial recognition of assets or liabilities that affect neither accounting nor taxable profit. The amount of deferred tax provided is based on the expected manner of realization or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the financial position reporting date.
A deferred tax asset is recognized only to the extent that it is probable that future taxable profits will be available against which the asset can be utilized.
Changes in Accounting Policies
New Accounting Standards Not Yet Adopted
Certain pronouncements were issued by the IASB or the IFRIC that are mandatory for accounting periods commencing on or after June 1, 2025. Many are not applicable or do not have a significant impact to the Company and have been excluded. The Company is currently assessing the impact of these standards on the consolidated financial statements.
Classification and Measurement of Financial Instruments (Amendments to IFRS 9 and IFRS 7)
In May 2024, the IASB issued amendments to IFRS 9 Financial Instruments and IFRS 7 Financial Instruments – Disclosures. The amendments clarify the derecognition of financial liabilities and introduces an accounting policy option to derecognize financial liabilities that are settled through an electronic payment system. The amendments also clarify how to assess the contractual cash flow characteristics of financial assets that include environmental, social and governance (ESG)-linked features and other similar contingent features and the treatment of non-recourse assets and contractually linked instruments (CLIs). Further, the amendments mandate additional disclosures in IFRS 7 for financial instruments with contingent features and equity instruments classified at FVOCI. The amendments are effective for annual periods starting on or after January 1, 2026. Retrospective application is required and early adoption is permitted.
Presentation and Disclosure in Financial Statements (IFRS 18)
In April 2024, the IASB issued IFRS 18 Presentation and Disclosure in Financial Statements to improve reporting of financial performance. The new standards replaces IAS 1 Presentation of Financial Statements. IFRS 18 introduces new categories and required subtotals in the statement of profit and loss and also requires disclosure of management-defined performance measures. It also includes new requirements for the location, aggregation and disaggregation of financial information. The standard is effective for annual reporting periods beginning on or after January 1, 2027, including interim financial statements. Retrospective application is required and early adoption is permitted.