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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended April 30, 2025

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

For the transition period from _____________ to ______________

Commission File No. 000-50956

PHARMA-BIO SERV, INC.

(Exact Name of Registrant as Specified in Its Charter)

Delaware

20-0653570

(State or Other Jurisdiction of

Incorporation or Organization)

(IRS Employer

Identification No.)

Pharma-Bio Serv

# 6 Road 696 Dorado, Puerto Rico

00646

(Address of Principal Executive Offices)

(Zip Code)

787-278-2709

(Registrant’s Telephone Number, Including Area Code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act: None

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

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. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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

If an emerging growth company, 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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of the registrant’s common stock outstanding as of June 10, 2025 was 22,927,942.

PHARMA-BIO SERV, INC.

FORM 10-Q

FOR THE QUARTER ENDED APRIL 30, 2025

TABLE OF CONTENTS

		Page
PART I FINANCIAL INFORMATION

Item 1 – Financial Statements		2

Condensed Consolidated Balance Sheets as of April 30, 2025 and October 31, 2024 (unaudited)		2

Condensed Consolidated Statements of Operations for the three-month and six-month periods ended April 30, 2025 and 2024 (unaudited)		3

Condensed Consolidated Statements of Comprehensive Income (Loss) for the three-month and six-month periods ended April 30, 2025 and 2024 (unaudited)		4

Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three-month and six-month periods ended April 30, 2025 and 2024 (unaudited)		5

Condensed Consolidated Statements of Cash Flows for the three-month and six-month periods ended April 30, 2025 and 2024 (unaudited)		7

Notes to Condensed Consolidated Financial Statements (unaudited)		8

Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations		15

Item 4 – Controls and Procedures		18

PART II OTHER INFORMATION

Item 1 – Legal Proceedings		19

Item 1A – Risk Factors		19

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds		19

Item 6 – Exhibits		20

SIGNATURES		21

- 1 -

Table of Contents

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

PHARMA-BIO SERV, INC.

Condensed Consolidated Balance Sheets

(Unaudited)

ASSETS	April 30, 2025*			October 31, 2024**
Current assets
Cash and cash equivalents	$	2,093,075		$	6,767,356
Marketable securities		8,313,189			5,978,104
Accounts receivable		2,684,052			2,510,909
Prepaids and other assets		327,089			442,384
Total current assets		13,417,405			15,698,753

Property and equipment, net		145,234			169,281
Operating lease right-of-use		115,259			198,597
Other assets		225,643			225,599
Total assets	$	13,903,541		$	16,292,230

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Current operating lease liabilities	$	113,044		$	165,201
Accounts payable and accrued expenses		937,907			1,127,649
Current portion of US Tax Reform Transition Tax and income taxes payable		729,282			594,316
Total current liabilities		1,780,233			1,887,166

US Tax Reform Transition Tax payable		-			660,903
Long-term operating lease liabilities		-			28,834
Total liabilities		1,780,233			2,576,903

Stockholders' equity
Preferred Stock, $0.0001 par value; authorized 10,000,000 shares; none outstanding		-			-
Common Stock, $0.0001 par value; authorized 50,000,000 shares; 23,519,672 and 23,512,880 shares issued, and 22,928,642 and 22,958,143 shares outstanding at April 30, 2025 and October 31, 2024, respectively		2,352			2,352
Additional paid-in capital		1,665,149			1,644,468
Retained earnings		10,737,941			12,353,970
Accumulated other comprehensive income		282,946			262,380
		12,688,388			14,263,170
Treasury stock, at cost; 591,030 and 561,529 common shares held at April 30, 2025 and October 31, 2024, respectively		(565,080	)		(547,843	)
Total stockholders' equity		12,123,308			13,715,327
Total liabilities and stockholders' equity	$	13,903,541		$	16,292,230

*	Unaudited.
**	Condensed from audited financial statements.

See notes to the condensed consolidated financial statements.

- 2 -

Table of Contents

PHARMA-BIO SERV, INC.

Condensed Consolidated Statements of Operations

(Unaudited)

	Three months ended April 30,						Six months ended April 30,
	2025			2024			2025			2024
REVENUES	$	2,417,044		$	2,377,617		$	4,888,377		$	4,757,804

COST OF SERVICES		1,598,318			1,759,142			3,301,542			3,603,720

GROSS PROFIT		818,726			618,475			1,586,835			1,154,084

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES		917,048			931,850			1,777,348			1,905,759

LOSS FROM OPERATIONS		(98,322	)		(313,375	)		(190,513	)		(751,675	)

OTHER INCOME, NET		199,186			120,737			301,028			301,266

INCOME (LOSS) BEFORE INCOME TAX		100,864			(192,638	)		110,515			(450,409	)

INCOME TAX EXPENSE		5,511			21,179			6,626			34,127

NET INCOME (LOSS)	$	95,353		$	(213,817	)	$	103,889		$	(484,536	)

BASIC AND DILUTED EARNINGS (LOSS) PER COMMON SHARE	$	0.004		$	(0.009	)	$	0.005		$	(0.021	)

WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING – BASIC		22,934,385			22,961,360			22,946,461			22,963,424

WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING - DILUTED		22,944,408			22,968,601			22,952,887			22,984,914

See notes to the condensed consolidated financial statements.

- 3 -

Table of Contents

PHARMA-BIO SERV, INC.

Condensed Consolidated Statements of Comprehensive Income (Loss)

(Unaudited)

	Three months ended April 30,						Six months ended April 30,
	2025			2024			2025			2024
NET INCOME (LOSS)	$	95,353		$	(213,817	)	$	103,889		$	(484,536	)

OTHER COMPREHENSIVE INCOME (LOSS)

Foreign currency translation:
Net unrealized gain (loss)		142,480			(36,606	)		95,117			(3,649	)
Intercompany balances foreign exchange settlement, included in net income (loss)		(103,417	)		34,942			(74,551	)		16,925

TOTAL OTHER COMPREHENSIVE INCOME (LOSS)		39,063			(1,664	)		20,566			13,276

COMPREHENSIVE INCOME (LOSS)	$	134,416		$	(215,481	)	$	124,455		$	(471,260	)

See notes to the condensed consolidated financial statements.

- 4 -

Table of Contents

PHARMA-BIO SERV, INC.

Condensed Consolidated Statements of Changes in Stockholders' Equity

(Unaudited)

													Accumulated
									Additional				Other
FISCAL YEAR 2025	Common Stock				Preferred Stock				Paid-in		Retained		Comprehensive		Treasury
(THREE MONTHS ENDED APRIL 30, 2025)	Shares		Amount		Shares		Amount		Capital		Earnings		Income (Loss)		Stock			Total
BALANCE AT JANUARY 31, 2025		23,519,672	$	2,352		-	$	-	$	1,655,149	$	10,642,588	$	243,883	$	(547,843	)	$	11,996,129

STOCK-BASED COMPENSATION		-		-		-		-		10,000		-		-		-			10,000

PURCHASE OF TREASURY STOCK (29,501 SHARES)		-		-		-		-		-		-		-		(17,237	)		(17,237	)

NET INCOME		-		-		-		-		-		95,353		-		-			95,353

OTHER COMPREHENSIVE INCOME, NET OF TAX		-		-		-		-		-		-		39,063		-			39,063

BALANCE AT APRIL 30, 2025		23,519,672	$	2,352		-	$	-	$	1,665,149	$	10,737,941	$	282,946	$	(565,080	)	$	12,123,308

														Accumulated
									Additional					Other
FISCAL YEAR 2025	Common Stock				Preferred Stock				Paid-in		Retained			Comprehensive		Treasury
(SIX MONTHS ENDED APRIL 30, 2025)	Shares		Amount		Shares		Amount		Capital		Earnings			Income (Loss)		Stock			Total
BALANCE AT NOVEMBER 1, 2024		23,519,672	$	2,352		-	$	-	$	1,644,468	$	12,353,970		$	262,380	$	(547,843	)	$	13,715,327

STOCK-BASED COMPENSATION		-		-		-		-		20,681		-			-		-			20,681

PURCHASE OF TREASURY STOCK (29,501 SHARES)		-		-		-		-		-		-			-		(17,237	)		(17,237	)

NET INCOME		-		-		-		-		-		103,889			-		-			103,889

OTHER COMPREHENSIVE INCOME, NET OF TAX		-		-		-		-		-		-			20,566		-			20,566

CASH DIVIDEND ($0.075 PER COMMON SHARE AT RECORD DATE)		-		-		-		-		-		(1,719,918	)		-		-			(1,719,918	)

BALANCE AT APRIL 30, 2025		23,519,672	$	2,352		-	$	-	$	1,665,149	$	10,737,941		$	282,946	$	(565,080	)	$	12,123,308

See notes to condensed consolidated financial statements.

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PHARMA-BIO SERV, INC.

Condensed Consolidated Statements of Changes in Stockholders' Equity (continued)

(Unaudited)

														Accumulated
									Additional					Other
FISCAL YEAR 2024	Common Stock				Preferred Stock				Paid-in		Retained			Comprehensive			Treasury
(THREE MONTHS ENDED APRIL 30, 2024)	Shares		Amount		Shares		Amount		Capital		Earnings			Income (Loss)			Stock			Total
BALANCE AT JANUARY 31, 2024		23,519,672	$	2,352		-	$	-	$	1,611,722	$	12,860,870		$	225,206		$	(543,773	)	$	14,156,377

STOCK-BASED COMPENSATION		-		-		-		-		14,800		-			-			-			14,800

PURCHASE OF TREASURY STOCK (2,500 SHARES)		-		-		-		-		-		-			-			(2,323	)		(2,323	)

NET LOSS		-		-		-		-		-		(213,817	)		-			-			(213,817	)

OTHER COMPREHENSIVE LOSS, NET OF TAX		-		-		-		-		-		-			(1,664	)		-			(1,664	)

BALANCE AT APRIL 30, 2024		23,519,672	$	2,352		-	$	-	$	1,626,522	$	12,647,053		$	223,542		$	(546,096	)	$	13,953,373

														Accumulated
									Additional					Other
FISCAL YEAR 2024	Common Stock				Preferred Stock				Paid-in		Retained			Comprehensive		Treasury
(SIX MONTHS ENDED APRIL 30, 2024)	Shares		Amount		Shares		Amount		Capital		Earnings			Income (Loss)		Stock			Total
BALANCE AT NOVEMBER 1, 2023		23,512,880	$	2,351		-	$	-	$	1,596,922	$	14,853,826		$	210,266	$	(536,580	)	$	16,126,785

STOCK-BASED COMPENSATION		-		-		-		-		29,600		-			-		-			29,600

ISSUANCE OF COMMON STOCK PURSUANT TO THE CASHLESS EXERCISE OF STOCK OPTIONS		6,792		1		-		-		-		(1	)		-		-			-

PURCHASE OF TREASURY STOCK (9,600 SHARES)		-		-		-		-		-		-			-		(9,516	)		(9,516	)

NET LOSS		-		-		-		-		-		(484,536	)		-		-			(484,536	)

OTHER COMPREHENSIVE INCOME, NET OF TAX		-		-		-		-		-		-			13,276		-			13,276

CASH DIVIDENDS ($0.075 PER COMMON SHARE AT RECORD DATE)		-		-		-		-		-		(1,722,236	)		-		-			(1,722,236	)

BALANCE AT APRIL 30, 2024		23,519,672	$	2,352		-	$	-	$	1,626,522	$	12,647,053		$	223,542	$	(546,096	)	$	13,953,373

See notes to condensed consolidated financial statements.

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PHARMA-BIO SERV, INC.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

	Three months ended April 30,						Six months ended April 30,
	2025			2024			2025			2024
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	95,353		$	(213,817	)	$	103,889		$	(484,536	)
Adjustments to reconcile net income (loss) to net cash and cash equivalents provided by (used in) operating activities:
Stock-based compensation		10,000			14,800			20,681			29,600
Depreciation and amortization		18,866			5,508			28,305			12,794
Amortization of operating lease right-of-use		41,952			39,170			83,338			77,461
Reinvested interests		36,922			(25,872	)		(100,837	)		(208,087	)
Decrease (increase) in accounts receivable		62,471			(209,313	)		(123,894	)		1,351,823
Decrease (increase) in other assets		30,677			65,417			68,414			53,889
Increase (decrease) in liabilities		(597,831	)		(376,637	)		(810,972	)		(807,743	)
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES		(301,590	)		(700,744	)		(731,076	)		25,201

CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property and equipment		(4,258	)		-			(4,258	)		(820	)
Marketable securities settlement (investment), net		(3,222,586	)		(458,942	)		(2,234,248	)		(5,221,521	)
NET CASH USED IN INVESTING ACTIVITIES		(3,226,844	)		(458,942	)		(2,238,506	)		(5,222,341	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Repurchase of common stock		(17,237	)		(2,323	)		(17,237	)		(9,516	)
Cash dividends paid to shareholders		(1,719,918	)		(1,722,236	)		(1,719,918	)		(1,722,236	)
NET CASH USED IN FINANCING ACTIVITIES		(1,737,155	)		(1,724,559	)		(1,737,155	)		(1,731,752	)

EFFECT OF EXCHANGE RATE CHANGES ON CASH		51,541			(19,896	)		32,456			(7,753	)
NET DECREASE IN CASH AND CASH EQUIVALENTS		(5,214,048	)		(2,904,141	)		(4,674,281	)		(6,936,645	)
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD		7,307,123			6,413,550			6,767,356			10,446,054
CASH AND CASH EQUIVALENTS – END OF PERIOD	$	2,093,075		$	3,509,409		$	2,093,075		$	3,509,409

SUPPLEMENTAL DISCLOURES OF CASH FLOWS INFORMATION:
Cash paid during the period for:
Income taxes	$	528,746	$	426,283	$	528,746	$	426,283
Interest	$	-	$	-	$	-	$	-

SUPPLEMENTARY SCHEDULES OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Income tax withheld by clients to be used as a credit in the Company’s income tax return	$	-	$	26,497	$	-	$	46,994
Conversion of cashless exercise of options to shares of common stock and shares issued under restricted stock unit agreements	$	-	$	-	$	-	$	1

See notes to the condensed consolidated financial statements.

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PHARMA-BIO SERV, INC.

Notes To Condensed Consolidated Financial Statements

April 30, 2025

(Unaudited)

NOTE A - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

ORGANIZATION

Pharma-Bio Serv, Inc. (“Pharma-Bio”) is a Delaware corporation organized on January 14, 2004. Pharma-Bio is the parent company of Pharma-Bio Serv PR, Inc. (“Pharma-PR”), Pharma Serv, Inc. (“Pharma-Serv”), and Scienza Labs, Inc. (currently inactive) (“Scienza Labs”), each a Puerto Rico corporation, Pharma-Bio Serv US, Inc. (“Pharma-US”), a Delaware corporation, Pharma-Bio Serv SL (“Pharma-Spain”), a Spanish limited liability company, and Pharma-Bio Serv Brasil Servicos de Consultoria Ltda. (currently insignificant) (“Pharma-Brazil”), a Brazilian limited liability company. Pharma-Bio, Pharma-PR, Pharma-Serv, Scienza Labs, Pharma-US, Pharma-Spain and Pharma-Brazil are collectively referred to as the “Company.” The Company operates in Puerto Rico, the United States, Europe and Brazil under the name of Pharma-Bio Serv and is engaged in providing technical compliance consulting service.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The condensed consolidated balance sheet of the Company as of October 31, 2024 is derived from audited consolidated financial statements but does not include all disclosures required by generally accepted accounting principles. The unaudited interim condensed consolidated financial statements, include all adjustments, consisting of normal recurring adjustments, which are, in the opinion of management, necessary for a fair presentation of the financial position and results of operations and cash flows for the interim periods. The results of operations for the six months ended April 30, 2025 are not necessarily indicative of expected results for the full 2025 fiscal year.

The accompanying financial data as of April 30, 2025, and for the three-month and six-month periods ended April 30, 2025 and 2024 has been prepared by us, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally contained in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the financial statements and notes contained in our audited Consolidated Financial Statements and the notes thereto for the fiscal year ended October 31, 2024.

Consolidation

The accompanying condensed consolidated financial statements include the accounts of the Company and all of its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.

Segments

The Company operates in three reportable business segments: (i) Puerto Rico technical compliance consulting, (ii) United States technical compliance consulting, and (iii) Europe technical compliance consulting. Accordingly, the accompanying condensed consolidated financial statements are presented to show these three reportable segments.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results may differ from these estimates.

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Fair Value of Financial Instruments

Accounting standards have established a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Accounting standards have established three levels of inputs that may be used to measure fair value:

	Level 1:	Quoted prices in active markets for identical assets and liabilities.

	Level 2:	Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted prices in markets with insufficient volume or infrequent transactions (less active markets), or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities.

	Level 3:	Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).

Marketable securities consist of U.S. Treasury securities, which are categorized in Level 1 and have a short-term maturity.

The carrying value of the Company's financial instruments, cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities, are considered reasonable estimates of fair value due to their liquidity or short-term nature.

Revenue Recognition

The Company records revenue under Accounting Standards Codification ("ASC") Topic 606, Revenue from Contracts with Customers. We evaluate our revenue contracts with customers based on the five-step model under ASC 606: (i) Identify the contract with the customer; (ii) Identify the performance obligations in the contract; (iii) Determine the transaction price; (iv) Allocate the transaction price to separate performance obligations; and (v) Recognize revenue when (or as) each performance obligation is satisfied.

Revenue is primarily derived from: (1) time and material contracts (representing approximately 99% of total revenues), and (2) short-term fixed-fee contracts or "not to exceed" contracts (representing approximately 1% of total revenues). Time and material contracts are typically based on the number of hours worked at contractually agreed upon rates. These service contracts relate to work which has no alternative use and for which the Company has an enforceable right to payment for the work completed to date. As a result, revenue is recognized over time when or as the Company transfers control of the promised products or services (known as performance obligations) to its customers. Revenue for short term fixed fee contracts or “not to exceed” contracts is recognized similarly, except that certain milestones also have to be reached before revenue is recognized. If the Company determines that a contract will result in a loss, the Company recognizes the estimated loss in the period in which such a determination is made.

Cash Equivalents

For purposes of the condensed consolidated statements of cash flows, cash equivalents consist of cash and liquid investments, including U.S. Treasury securities, with original maturities of three months or less.

Accounts Receivable

Accounts receivable are reported net of an allowance for credit losses. The Company maintains an allowance for credit losses to provide for estimated amounts of receivables that will not be collected. This estimation is based on historical collection experience, the age of the receivables, an assessment of the creditworthiness of customers, and current economic conditions. The allowance for credit losses is subject to estimation uncertainty. If actual future uncollectible amounts differ from estimates, future provisions for credit losses may be affected. The allowance is increased by provisions charged to credit loss expense and reduced by charge-offs of uncollectible accounts. As of April 30, 2025 and October 31, 2024, the allowance for credit losses was approximately $5.3 million, and there were no charges to expense or charge-offs of uncollectible accounts during the three and six months ended on April 30, 2025 and 2024. The existing allowance is mostly related to an account that is being litigated, which was fully allowed in 2021.

Income Taxes

The Company follows an asset and liability approach method of accounting for income taxes. This method measures deferred income taxes by applying enacted statutory rates in effect at the balance sheet date to the differences between the tax basis of assets and liabilities and their reported amounts on the financial statements. The resulting deferred tax assets or liabilities are adjusted to reflect changes in tax laws as they occur. A valuation allowance is provided when it is more likely than not that a deferred tax asset will not be realized.

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The Company follows guidance from the Financial Accounting Standards Board (“FASB”) related to Accounting for Uncertainty in Income Taxes, which includes a two-step approach to recognizing, de-recognizing and measuring uncertain tax positions. As of April 30, 2025, the Company had no significant uncertain tax positions that would be reduced as a result of a lapse of the applicable statute of limitations.

Leases

The Company follows accounting standards issued by the FASB for the accounting and disclosure of leases. Under those standards, assets and liabilities that arise from leases are recognized on the balance sheet, and the leases are categorized at their inception as either operating or finance leases.

Operating lease right-of-use assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments under the lease. Lease recognition occurs at the commencement date, and lease liability amounts are based on the present value of lease payments made during the lease term, based on a discount rate of 8%.

Property and Equipment

Owned property and equipment are stated at cost. Depreciation of owned assets are provided for, when placed in service, in amounts sufficient to relate the cost of depreciable assets to operations over their estimated service lives, using straight-line basis. Expenditures for repairs and maintenance are expensed when incurred. As of April 30, 2025 and October 31, 2024, the accumulated depreciation amounted to $687,734 and $658,249, respectively.

Impairment of Long-Lived Assets

The Company evaluates for impairment its long-lived assets to be held and used, and long-lived assets to be disposed of, whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Based on management estimates, no impairment of the long-lived assets was present as of April 30, 2025 and October 31, 2024.

Stock-based Compensation

Stock-based compensation expense is recognized in the consolidated financial statements based on the fair value of the awards granted. Stock-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense over the requisite service period, which represents the vesting period, and includes an estimate of awards that will be forfeited. The Company calculates the fair value of stock options using the Black-Scholes option-pricing model at the grant date, while for restricted stock units the fair market value of the units is determined by the Company’s share market value at grant date. Excess tax benefits related to stock-based compensation are reflected as cash flows from financing activities rather than cash flows from operating activities. The Company has not recognized such cash flows from financing activities since there has been no tax benefit related to the stock-based compensation.

Earnings (Loss) Per Share of Common Stock

Basic earnings (loss) per share of common stock is calculated by dividing net earnings (loss) by the weighted average number of shares of common stock outstanding. Diluted earnings (loss) per share includes the dilution of common stock equivalents, which include principally shares that may be issued upon the exercise of warrants, stock option and restricted stock unit awards.

The diluted weighted average shares of common stock outstanding were calculated using the treasury stock method for the respective periods.

Foreign Operations

The functional currency of the Company’s foreign subsidiaries is its local currency. The assets and liabilities of the Company’s foreign subsidiaries are translated into U.S. dollars at exchange rates in effect at the balance sheet date. Income and expense items are translated at the average exchange rates prevailing during the period. The cumulative translation effect for subsidiaries using a functional currency other than the U.S. dollar is included as a cumulative translation adjustment in stockholders’ equity and as a component of comprehensive income (loss).

The Company’s intercompany accounts are typically denominated in the functional currency of the foreign subsidiary. Gains and losses resulting from the remeasurement of intercompany receivables that the Company considers to be of a long-term investment nature are recorded as a cumulative translation adjustment in stockholders’ equity and as a component of comprehensive income (loss), while gains and losses resulting from the remeasurement of intercompany receivables from those international subsidiaries for which the Company anticipates settlement in the foreseeable future are recorded in the consolidated statements of operations.

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Subsequent Events

The Company has evaluated subsequent events through the filing date of this report. The Company has determined that there are no events occurring in this period that require disclosure or adjustment.

Reclassifications

Certain reclassifications have been made to the April 30, 2024 condensed consolidated financial statements to conform them to the April 30, 2025 condensed consolidated financial statements presentation. Such reclassifications do not affect net loss as previously reported.

Recent Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07 Segment Reporting to provide more detail information about a reportable segment's expenses. Effective November 1, 2024, the Company adopted ASU No. 2023-07, and the adoption of this standard did not have a significant impact on the Company's condensed consolidated financial statements.

Recent accounting pronouncements pending adoption not discussed above or in the Form 10-K for the year ended October 31, 2024, are either not applicable or will not have or are not expected to have a material impact on us.

NOTE B – MARKETABLE SECURITIES

Marketable securities consist of short-term U.S. Treasury securities with maturities over three months, which are held to maturity and accordingly, are measured at cost plus accreted interest income.

NOTE C - INCOME TAXES

On December 22, 2017, Public Law 115-97, commonly known as the Tax Cuts and Jobs Act of 2017 (the “Tax Reform”), was enacted. The Tax Reform imposed a mandatory one-time transition tax (the “Transition Tax”) over foreign subsidiaries undistributed earnings and profits (“E&Ps”) earned prior to a date set by the statute. Based on the Company’s E&Ps, the Transition Tax was determined to be approximately $2.7 million. The Transition Tax liability must be paid over a period of eight years, which started with the Company’s second quarter of fiscal year 2019 and ends second quarter of fiscal 2026. In the past, most of these E&Ps were not repatriated since such E&Ps were considered to be reinvested indefinitely in the foreign location, therefore no U.S. tax liability was incurred unless the E&Ps were repatriated as a dividend. After December 31, 2017, the Tax Reform established a 100% tax exemption on the foreign-source portion of dividends received attributable to E&Ps, with certain limitations. However, foreign subsidiaries earnings are subject to U.S. tax at a reduced rate of 10.5%.

In June 2011, Pharma-Bio, Pharma-PR and Pharma-Serv obtained a Grant of Industrial Tax Exemption pursuant to the terms and conditions set forth in Act No. 73 of May 28, 2008 (“the Grant”) issued by the Puerto Rico Industrial Development Company (“PRIDCO”). The Grant was effective as of November 1, 2009, and covered a fifteen-year period which expired on October 31, 2024. Under the provisions of Puerto Rico Acts 60-2019 and 73-2008, the Company requested that PRIDCO extend the Grant for an additional term of fifteen years. As of the date of this filing, we have not received a status update from PRIDCO for this request, accordingly, since the Company does not anticipate problems with the Grant approval, the condensed consolidated financial statements tax provision was made under the assumption that the Grant will be awarded under similar terms to the original Grant, effective November 1, 2024. The Grant, if awarded, will continue to provide relief on various Puerto Rico taxes, including income tax, with certain limitations, for most of the activities conducted within Puerto Rico, including those that are for services to parties located outside of Puerto Rico. Industrial Development Income (“IDI”) covered under the Grant will be subject to a fixed income tax rate of 4%. In addition, IDI earnings distributions accumulated since November 1, 2009 will continue to be exempt from Puerto Rico earnings distribution tax.

Puerto Rico operations not covered in the exempt activities of the Grant are subject to Puerto Rico income tax at a maximum tax rate of 37.5% as provided by the 1994 Puerto Rico Internal Revenue Code, as amended. The operations carried in the United States by the Company’s subsidiaries, is taxed in the United States at a maximum regular federal income tax rate of 21%. The Spanish subsidiary operations in Spain are taxed at a regular income tax rate of 25%.

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Deferred income tax assets and liabilities are computed for differences between the consolidated financial statements and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Realization of future tax benefits related to a deferred tax asset is dependent on many factors. Accordingly, the income tax benefit will be recognized when realization is determined to be more probable than not.

The Company files income tax returns in the United States (federal and various states jurisdictions), Puerto Rico, Spain and Brazil. The 2020 (2019 for Puerto Rico) through 2024 tax years are open and may be subject to potential examination in one or more jurisdictions. Currently, the Company has no federal, state, Puerto Rico or foreign income tax examination.

NOTE D – EARNINGS (LOSS) PER SHARE

The following data shows the amounts used in the calculations of basic and diluted earnings (losses) per share.

	Three months ended April 30,					Six months ended April 30,
	2025		2024			2025		2024
Net income (loss) available to common equity holders - used to compute basic and diluted earnings per share	$	95,353	$	(213,817	)	$	103,889	$	(484,536	)

Weighted average number of common shares - used to compute basic earnings per share		22,934,385		22,961,360			22,946,461		22,963,424
Effect of options to purchase common stock		10,023		7,241			6,426		21,490
Weighted average number of shares - used to compute diluted earnings per share		22,944,408		22,968,601			22,952,887		22,984,914

For the three-month and six-month periods ended April 30, 2025, options for the purchase of 373,350 shares of common stock, and options for the purchase of 293,350 and 213,350 shares of common stock for the three-month and six-month periods ended April 30, 2024, respectively, were not considered in computing diluted earnings (loss) per share because their effect was antidilutive.

NOTE E – EQUITY TRANSACTIONS

On June 13, 2014, the Board of Directors of the Company authorized the Company to repurchase up to two million shares of its outstanding common stock under the Company Stock Repurchase Program (the “Repurchase Program”). The timing, manner, price and amount of any repurchases under the Repurchase Program will be at the discretion of the Company, subject to the requirements of the Securities Exchange Act of 1934, as amended, and related rules. The Repurchase Program does not oblige the Company to repurchase any shares, and it may be modified, suspended or terminated at any time and for any reason. No shares will be repurchased under the Repurchase Program directly from directors or officers of the Company. As of April 30, 2025 and October 31, 2024, a total of 528,058 and 498,557 shares of the Company’s common stock were purchased under the Repurchase Program for an aggregate amount of $502,108 and $484,871, respectively.

On January 28, 2025, the Board of Directors of the Company declared a cash dividend of $0.075 per common share for shareholders of record as of the close of business on February 28, 2025. Accordingly, an aggregate dividend payment of $1,719,918 was paid on March 20, 2025.

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NOTE F - CONCENTRATIONS OF RISK

Cash, Cash Equivalents and Marketable Securities

The Company’s domestic cash and cash equivalents, and marketable securities consist of cash deposits in FDIC insured banks (substantially covered by FDIC insurance by the spreading of deposits in multiple FDIC insured banks), and U.S. Treasury securities with maturities of twelve months or less. The U.S. Treasury securities are held in the custody of major financial institutions and their value is not subject to insurance. In the foreign markets we serve, we also maintain cash deposits in foreign banks, which have no specific insurance. Normally, these uninsured bank deposits are not significant, and they are deposited with major multinational banks. No significant losses have been experienced nor are they expected on these bank accounts or investments.

Accounts receivable and revenues

The Company's revenues, and the related receivables, are concentrated in the pharmaceutical industry in Puerto Rico, the United States of America and Europe. Although a few customers represent a significant source of revenue, the Company’s functions are not a continuous process, accordingly, the client base for which the services are typically rendered, on a project-by-project basis, changes regularly.

The Company provided a substantial portion of its services to four customers, which accounted for 10% or more of its revenues in either of the three-month and six-month periods ended April 30, 2025 and 2024. During the three months ended April 30, 2025, revenues from these customers were 17.4%, 9.7%, 10.9% and 14.1%, or a total of 52.1%, as compared to the same period last year of 16.0%, 0.0%, 19.7% and 6.8%, or a total of 42.5%, respectively. During the six months ended April 30, 2025, revenues from these customers were 16.6%, 15.6%, 11.3% and 11.3%, or a total of 54.8%, as compared to the same period last year of 15.9%, 0.0%, 19.2% and 6.5%, or a total of 41.6%, respectively. For the three months ended April 30, 2025 and 2024, these customers represented for the Puerto Rico, United States and Europe consulting reportable segments 25.0%, 17.4% and 9.7%, as compared to 26.5%, 16.0% and 0.0%, respectively. For the six months ended April 30, 2025 and 2024, these customers represented for the Puerto Rico, United States and Europe consulting reportable segments 22.6%, 16.6% and 15.6%, as compared to 25.7%, 15.9% and 0.0%, respectively. On April 30, 2025, amounts due from these customers represented 49.1% of the Company’s total accounts receivable balance. This customer information is based on revenues earned from said customers at the segment levels.

At the global level, four global groups of affiliated companies accounted for 10% or more of the Company's revenues in either of the three-month and six-month periods ended April 30, 2025 and 2024. During the three months ended April 30, 2025, aggregate revenues from these global groups of affiliated companies were 17.9%, 9.7%, 10.9% and 14.1%, or a total of 52.6%, as compared to the same period last year for 18.6%, 0.0%, 19.7% and 6.8%, or a total of 45.1%, respectively. During the six months ended April 30, 2025, aggregate revenues from these global group of affiliated companies were 17.7%, 15.6%, 11.3% and 11.3%, or a total of 55.9%, as compared to the same period last year for 18.6%, 0.0%, 19.2% and 6.5%, or a total of 44.3%, respectively. For the three months ended April 30, 2025 and 2024, these customers represented for the Puerto Rico, United States and Europe consulting reportable segments 25.5%, 17.4% and 9.7%, as compared to 29.1%, 16.0% and 0.0%, respectively. For the six months ended April 30, 2025 and 2024, these customers represented for the Puerto Rico, United States and Europe consulting reportable segments 23.7%, 16.6% and 15.6%, as compared to 28.4%, 15.9% and 0.0%, respectively. At April 30, 2025, amounts due from these global groups of affiliated companies represented 53.7% of total accounts receivable balance.

NOTE F - SEGMENT DISCLOSURES

The Company’s segments are based on the organizational structure for which financial results are regularly evaluated by the Company’s chief operating decision maker (the “CODM”) to determine resource allocation and assess performance. Each reportable segment is managed by its own management team and reports to executive management. The Company has three reportable segments: (i) Puerto Rico consulting, (ii) United States consulting, and (iii) Europe consulting. The reportable segments provide services primarily to the pharmaceutical, chemical, medical device and biotechnology industries in their respective markets. The services vary between customers and projects based on the nature of the project and the technical skills necessary to accomplish the project tasks. Therefore, the allocation of consultancy resources is mostly based on the segment’s ability to provide the best consultant in the most profitable cost-effective manner. Accordingly, the CODM evaluates segment performance based on the segment’s (i) revenue volume, (ii) gross profit ratio to revenue, and (iii) income (loss) from operations.

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The following table presents information about the reported segments revenue from services, gross profit ratio to revenue and income (loss) from operations of the Company for the three-month and six-month periods ended April 30, 2025 and 2024. There is no intersegment revenue for the mentioned periods. Corporate expenses that support the operating units have been allocated to the segments. Asset information by reportable segment is not presented, since the Company does not produce such information internally, nor does it use such data to manage its business.

	Three months ended April 30,											Six months ended April 30,
	2025						2024					2025					2024
REVENUES:
Puerto Rico consulting	$	1,170,245					$	1,462,662				$	2,273,514				$	2,853,271
United States consulting		714,104						802,551					1,360,237					1,685,441
Europe consulting		532,695						70,836					1,253,953					135,641
Other		-						41,568					673					83,451
Total consolidated revenue	$	2,417,044					$	2,377,617				$	4,888,377				$	4,757,804

GROSS PROFIT¹:
Puerto Rico consulting	$	347,521			29.7	%	$	318,672		21.8	%	$	545,075		24.0	%	$	517,124		18.1	%
United States consulting		216,375			30.3	%		237,755		29.6	%		438,700		32.3	%		540,917		32.1	%
Europe consulting		254,830			47.8	%		39,032		55.1	%		602,387		48.0	%		57,486		42.4	%
Other		-		-		%		23,016		55.4	%		673		100.0	%		38,557		46.2	%
Total consolidated gross profit	$	818,726			33.9	%	$	618,475		26.0	%	$	1,586,835		32.5	%	$	1,154,084		24.3	%

INCOME (LOSS) FROM OPERATIONS²:
Puerto Rico consulting	$	43,937					$	(85,005	)			$	(832	)			$	(297,555	)
United States consulting		(128,028	)					(148,203	)				(228,090	)				(282,731	)
Europe consulting		10,837						(88,174	)				77,218					(182,600	)
Other		(25,068	)					8,007					(38,809	)				11,211
Total consolidated loss from operations		(98,322	)					(313,375	)				(190,513	)				(751,675	)
OTHER INCOME, NET		199,186						120,737					301,028					301,266
Total consolidated income (loss) before income tax	$	100,864					$	(192,638	)			$	110,515				$	(450,409	)

¹ Gross profit represents revenues less cost of service, which the latter is mostly composed of personnel cost. Percentages represent the segment(s) gross profit to its related revenue segment(s).
² Income (loss) from operations represents gross profit reduced by selling, general and administrative expenses..

Long lived assets (property and equipment) as of April 30, 2025 and October 31, 2024, and related depreciation and amortization expense for the three and six months ended April 30, 2025 and 2024, were concentrated in the corporate offices in Puerto Rico. Accordingly, depreciation expense and acquisition of property and equipment, as presented in the condensed consolidated statements of cash flows, are mainly related to the corporate offices.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following discussion of our results of operations and financial condition should be read in conjunction with the financial statements and the related notes included under Part I, Item 1 of this Quarterly Report on Form 10-Q. In addition, reference should be made to our audited Consolidated Financial Statements and notes thereto, and related Management’s Discussion and Analysis of Financial Condition and Results of Operations appearing in our Annual Report on Form 10-K for the year ended October 31, 2024. The following discussion includes forward-looking statements. For a discussion of important factors that could cause actual results to differ from results discussed in the forward-looking statements, see “Forward Looking Statements” below and the “Risk Factors” section of our Annual Report on Form 10-K for the year ended October 31, 2024, our Quarterly Report on Form 10-Q for the quarter ended January 31, 2025, and this Quarterly Report on Form 10-Q.

Overview

We are a compliance and technology transfer services consulting firm with headquarters in Puerto Rico, servicing the Puerto Rico, United States and Europe markets, with limited presence in the Brazil market. The compliance consulting service sector in those markets consists of local compliance and validation consulting firms, United States dedicated validation and compliance consulting firms and large publicly traded and private domestic and foreign engineering and consulting firms. We provide a broad range of compliance-related consulting services. We market our services to pharmaceutical, chemical, biotechnology, medical devices, cosmetics and food industries, and allied products companies. Our consulting team includes experienced engineering and life science professionals, former quality assurance managers and directors, and professionals with bachelors, masters and doctorate degrees in health sciences and engineering.

We actively operate in Puerto Rico, the United States, Europe and, to a lesser extent, Brazil and pursue to further expand these markets by strengthening our business development infrastructure and by constantly realigning our business strategies as new opportunities and challenges arise.

We market our services with an active presence in industry trade shows, professional conventions, industry publications and company provided seminars to the industry. Our senior management is also actively involved in the marketing process, especially in marketing to major accounts. Our senior management and staff also concentrate on developing new business opportunities and focus on the larger customer accounts (by number of consultants or dollar volume) and responding to prospective customers’ requests for proposals.

We consider our core business to be Food and Drug Administration (“FDA”) and international agencies regulatory compliance consulting related services.

The Company maintained a tax grant issued by PRIDCO, which provided relief on various Puerto Rico taxes, including income tax, with certain limitations, for most of the activities conducted within Puerto Rico, including those that are for services to parties located outside of Puerto Rico. The grant was effective as of November 1, 2009, and covered a fifteen-year period, which ended on October 31, 2024. Under the provisions of Puerto Rico Acts 60-2019 and 73-2008, we have requested PRIDCO renegotiation of the tax grant for an additional term of fifteen years. As of the date of this filing, we have not received a status update from PRIDCO for this request, accordingly, although we do not anticipate problems with the Grant approval, we cannot provide assurance on the outcome for our renegotiation application. For additional information relating to the tax grant issued by PRIDCO, please see Note C – Income Taxes of the condensed consolidated financial statements.

Regional or global conflicts, including war or economic sanctions between nations, price inflation, pandemics, the Tax Reform, possible tax changes on jurisdictions where we do business, bio-pharmaceutical industry consolidations and the trends on managing contract resources, all pose current and future challenges which may adversely affect our future performance. We believe that our future profitability and liquidity will be dependent on the effect the local and global economy, including any impacts of regional or global conflicts, price inflation, pandemics, changes in tax laws, worldwide life science manufacturing industry consolidations, operational constraints imposed by our customers due to pandemics and resources management trends, will have on our operations, and our ability to seek service opportunities and adapt to industry trends.

The following table sets forth information as to our revenue for the three-month and six-month periods ended April 30, 2025 and 2024, by geographic regions (dollars in thousands, and as a percentage of total revenues).

	Three months ended April 30,								Six months ended April 30,
Revenues by Region:	2025				2024				2025				2024
Puerto Rico	$	1,170	48.4	%	$	1,463	61.5	%	$	2,273	46.5	%	$	2,853	60.0	%
United States		714	29.5	%		802	33.7	%		1,360	27.8	%		1,685	35.4	%
Europe		533	22.1	%		71	3.0	%		1,254	25.7	%		136	2.8	%
Other		-	0.0	%		41	1.8	%		1	0.0	%		84	1.8	%
	$	2,417	100.0	%	$	2,377	100.0	%	$	4,888	100.0	%	$	4,758	100.0	%

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For the six-month period ended April 30, 2025, the Company’s total revenues were approximately $4.9 million, a net increase of approximately $0.1 million when compared to the same period last year. The European market sustained an increase in project revenue of approximately $1.1 million, while the Puerto Rico, US and Brazil consulting markets had a decline in projects revenue of approximately $0.6, $0.3 and $0.1 million, respectively. As depicted below, when compared to the same period last year, gross profit increased by 8.2 percentage points. The net increase in gross profit percentage points is mainly attributable to a more favorable margin yielding project within the European market.

Results of Operations

The following table sets forth our statements of operations for the three-month and six-month periods ended April 30, 2025 and 2024 (dollars in thousands, and as a percentage of revenues):

	Three months ended April 30,									Six months ended April 30,
	2025				2024					2025				2024
Revenues	$	2,417	100.0	%	$	2,377		100.0	%	$	4,888	100.0	%	$	4,758		100.0	%
Cost of services		1,598	66.1	%		1,759		74.0	%		3,301	67.5	%		3,604		75.7	%
Gross profit		819	33.9	%		618		26.0	%		1,587	32.5	%		1,154		24.3	%
Selling, general and administrative expenses		917	37.9	%		932		39.2	%		1,777	36.4	%		1,905		40.0	%
Other income, net		199	8.2	%		121		5.1	%		301	6.1	%		301		6.3	%
Income (loss) before income tax		101	4.2	%		(193	)	(8.1	)%		111	2.2	%		(450	)	(9.4	)%
Income tax expense		6	0.3	%		21		0.9	%		7	0.1	%		34		0.7	%
Net income (loss)		95	3.9	%		(214	)	(9.0	)%		104	2.1	%		(484	)	(10.1	)%

Revenues. Total revenues for the three and six months ended April 30, 2025 were $2.4 and $4.9 million, respectively. This represents a negligible variance when compared to last year’s three-month period ended April 30, 2024, and an increase of $0.1 million when compared to the six months ended April 30, 2024. For the three months ended April 30, 2025, when compared to the same period last year, the European market revenue increased by $0.5 million, offset by the decline in project revenue in the Puerto Rico, United States and Brazil consulting markets of approximately $0.3, $0.1 and $0.1 million, respectively. For the six months ended April 30, 2025, when compared to the same period last year, the European market revenue increased by $1.1 million, partially offset by the decline in project revenue in the Puerto Rico, United States and Brazil consulting markets of approximately $0.6, $0.3 and $0.1 million, respectively.

Cost of Services; Gross Profit. Cost of services for the three and six months ended April 30, 2025 were $1.6 and $3.3 million, respectively, a decrease of $0.2 and $0.3 million, when compared to the same periods last year, respectively. Gross profit for the three and six months ended April 30, 2025, when compared to the same periods last year, increased by 7.9 and 8.2 percentage points, respectively. The net increase in gross profit percentage points is mainly attributable to a high margin yielding project within the European market.

Selling, General and Administrative Expenses. Selling, general and administrative expenses for the three and six months ended April 30, 2025 were approximately $0.9 and $1.8 million, respectively. When compared to last year’s six months ended April 30, 2024, this represents a decrease in expenses $0.1 million which are attributable to planned savings in general and administrative expenses.

Other Income, Net. Other income, net for the three and six months ended April 30, 2025 was approximately $0.2 and $0.3 million, respectively. These balances are mostly attributable to interest income, plus the settlement of foreign exchange rates on intercompany balances of approximately $0.1 million for the three and six months ended April 30, 2025.

Net Income (Loss). Net Income for the three and six months ended April 30, 2025 was approximately $0.1 million for each period, an earnings increase of approximately $0.3 and $0.6 million when compared to the same periods last year, respectively.

For the three and six months ended April 30, 2025, net earnings per common share for both basic and diluted were $0.004 and $0.005, respectively, an increase of $0.013 and $0.026 per share when compared to the same periods last year, respectively.

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Liquidity and Capital Resources

Liquidity is a measure of our ability to meet potential cash requirements, including planned capital expenditures. As of April 30, 2025, the Company had approximately $11.6 million in working capital.

On June 13, 2014, the Board of Directors of the Company authorized the Company to repurchase up to two million shares of its common stock (the “Repurchase Program”). The Repurchase Program does not have an expiration date. During the six-month period ended April 30, 2025, the Company repurchased 29,501 shares of its common stock. As of April 30, 2025, the Company has 1,471,942 shares of common stock available for future repurchases under the Repurchase Program.

Our primary cash needs consist of the payment of compensation to our consulting team, overhead expenses, and statutory taxes. Additionally, we may use cash for the repurchase of our common stock under the Repurchase Program, capital expenditures and business development expenses. Management believes that based on the current level of working capital, operations and cash flows from operations, and the collectability of high-quality customer receivables are sufficient to fund anticipated expenses and satisfy other possible long-term contractual commitments for and beyond the next twelve months.

While uncertainties relating to the current local and global economic conditions, competition, the industries and geographical regions served by us and other regulatory matters exist within the consulting services industry, as described in this Quarterly Report on Form 10-Q, management is not aware of any other trends or events likely to have a material adverse effect on liquidity or its financial statements.

Off-Balance Sheet Arrangements

We were not involved in any significant off-balance sheet arrangement during the six months ended April 30, 2025.

Critical Accounting Policies and Estimates

There were no material changes during the six months ended April 30, 2025 to the critical accounting policies reported in our Annual Report on Form 10-K for the fiscal year ended October 31, 2024.

New Accounting Pronouncements

There were no new accounting standards issued since our filing of the Annual Report on Form 10-K for the fiscal year ended October 31, 2024, which could have a significant effect on our condensed consolidated financial statements.

Forward-Looking Statements

Our business, financial condition, results of operations, cash flows and prospects, and the prevailing market price and performance of our common stock, may be adversely affected by a number of factors, including but not limited to, the factors set forth in the “Risk Factors” section of our Annual Report on Form 10-K for the year ended October 31, 2024, our Quarterly Report on Form 10-Q for the quarter ended January 31, 2025, and this Quarterly Report on Form 10-Q. Certain statements and information set forth in this Quarterly Report on Form 10-Q, as well as other written or oral statements made from time to time by us or by our authorized executive officers on our behalf, constitute “forward-looking statements” within the meaning of the Federal Private Securities Litigation Reform Act of 1995. These statements include all statements other than those made solely with respect to historical fact and identified by words such as “believes,” “anticipates,” “expects,” “intends” and similar expressions, but such words are not the exclusive means of identifying such statements. We intend for our forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and we set forth this statement and these risk factors in order to comply with such safe harbor provisions. You should note that our forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q or when made and we undertake no duty or obligation to update or revise our forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Although we believe that the expectations, plans, intentions and projections reflected in our forward-looking statements are reasonable, such statements are subject to known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. The risks, uncertainties and other factors that our stockholders and prospective investors should consider include, but are not limited to, those set forth in the “Risk Factors” section of our Annual Report on Form 10-K for the year ended October 31, 2024, our Quarterly Report on Form 10-Q for the quarter ended January 31, 2025, and this Quarterly Report on Form 10-Q.

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ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

We carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this Quarterly Report on Form 10-Q.

Changes in Internal Control Over Financial Reporting

Based on an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, there has been no change in our internal control over financial reporting during our last fiscal quarter identified in connection with that evaluation that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II– OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

From time to time, we may be a party to legal proceedings incidental to our business. Currently, there are no proceedings threatened or pending against us, which, if determined adversely to us, would have a material effect on our financial position or results of operations and cash flows. However, the Company is a complainant in one legal proceeding as described below.

On March 15, 2023, the Company’s subsidiaries Pharma-Bio Serv PR, Inc., Pharma Serv, Inc. and Scienza Labs, Inc., filed a breach of contract and money collection complaint against Romark Global Pharma, LLC, Romark Properties, LLC, Romark Biosciences, LLC and Romark Holdings, LLC (collectively, “Romark”), before the Commonwealth of Puerto Rico Court of First Instance, San Juan Superior Section. On November 13, 2023, a judgment was entered by the Court ordering Romark to pay jointly to the Company’s subsidiaries $6,717,431.69, which includes the principal amount of $5,246,782, plus interest up to the date of the judgment. The Company’s subsidiaries are pursuing assets and monies from Romark to collect the judgment. To this date, however, we have been unable to identify assets of Romark against which to collect. Aside from legal fees and the costs of identifying assets, and costs of collection efforts, no further losses are expected. The Company’s subsidiaries will continue the collection efforts with Romark. However, we cannot guarantee a successful outcome in collecting the funds owed to the Company’s subsidiaries.

ITEM 1A. RISK FACTORS.

There have been no material changes to the risk factors included in our Annual Report on Form 10-K for the year ended October 31, 2024.

ITEM 2.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

(c) The following table provides information about purchases by the Company of its shares of common stock during the three-month period ended April 30, 2025:

Period	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs ⁽¹⁾		Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs ⁽¹⁾
February 1, 2025 through February 28, 2025		25,901	$	0.60		25,901		1,475,542
March 1, 2025 through March 31, 2025		2,200	$	0.51		2,200		1,473,342
April 1, 2025 through April 30, 2025		1,400	$	0.50		1,400		1,471,942
Total		29,501	$	0.58		29,501

(1)

On June 16, 2014, the Company announced that the Board of Directors of the Company approved the Repurchase Program authorizing the Company to repurchase up to two million shares of its outstanding common stock. The timing, manner, price and amount of any repurchases under the Repurchase Program will be at the discretion of the Company, subject to the requirements of the Exchange Act Rules. The Repurchase Program does not oblige the Company to repurchase any shares and it may be modified, suspended or terminated at any time and for any reason. The Repurchase Program has no expiration date. No shares will be repurchased under the Repurchase Program directly from directors or officers of the Company.

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ITEM 6. EXHIBITS.

(a) Exhibits:

31.1		Certification of chief executive officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2		Certification of chief financial officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1*		Certification of the chief executive officer and chief financial officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS		XBRL Instance Document

101.SCH		XBRL Taxonomy Extension Schema

101.CAL		XBRL Taxonomy Extension Calculation Linkbase

101.DEF		XBRL Taxonomy Extension Definition Linkbase

101.LAB		XBRL Taxonomy Extension Label Linkbase

101.PRE		XBRL Taxonomy Extension Presentation Linkbase

104		Cover page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

_________________

*	Furnished herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	PHARMA-BIO SERV, INC.

	/s/ Victor Sanchez
	Victor Sanchez
	Chief Executive Officer and President Europe Operations
	(Principal Executive Officer)

	/s/ Pedro J. Lasanta
	Pedro J. Lasanta
	Chief Financial Officer, Vice President Finance and Administration, and Secretary
	(Principal Financial Officer and Principal Accounting Officer)

Dated: June 16, 2025

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Pharma-Bio Serv, Inc. 10-Q