Quarterly Report for Quarter Ending June 30, 2026 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion in conjunction with our financial statements, which are included elsewhere in this report.

Overview

We are and have since our inception in 2014 been engaged in the business of developing, selling, and marketing products in niche markets within the specialty outdoor products marketplace. We introduced our proprietary "Reel Guard" product in 2014 and continue to offer it for sale. We are continuing our efforts to design and develop our new Slow-Sinker product that involves the use of a single injection molded component made of a material with a density heavier than water to achieve a slow sinking rate with enough overall weight to accomplish long-distance casting.

Our financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. We did not generate sufficient revenue to generate net income, we have negative working capital, and we have a limited operating history. These factors, among others, may indicate that there is substantial doubt that we will be able to continue as a going concern for a reasonable period of time. Our financial statements do not include any adjustments relating to the recoverability and classification of assets and liabilities that might be necessary should we be unable to continue as a going concern. Our continuation as a going concern is dependent upon our ability to generate sufficient cash flow to meet our obligations on a timely basis and ultimately to attain profitability. We intend to seek additional funding, if and to the extent required, through additional stockholder loans and debt or equity offerings. We also intend to increase our sales through the addition of our proposed Slow-Sinker product if and when its design is finalized and manufacturing has commenced. There is no assurance that we will be successful in raising additional funds or that the Slow-Sinker product will be successfully designed or result in an increase in sales.

Results of Operations for the Three and Nine months Ended June 30, 2026 and 2025

Revenues

From our inception in 2014 through the present, our revenue has resulted solely from sales of our proprietary Reel Guard product, and our cost of sales also relate solely to that product. Our Reel Guard product is offered for sale on our website and on eBay and sales vary from quarter to quarter based on the number of customers that become aware of the product and decide to make a purchase. Total revenue for the three months ended June 30, 2026, was $52, compared to $137 for the three months ended June 30, 2025, a decrease $85, or 62%. Total revenue for the nine months ended June 30, 2026, was $117, compared to $189 for the nine months ended June 30, 2025, a decrease of $72, or 38.1%. We are not aware of any specific reason for the fluctuations in sales.

Cost of Sales

Cost of sales for the three months ended June 30, 2026 was $5, compared to $12 for the three months ended June 30, 2025, a decrease of $7, or 58.3%. Cost of sales for the nine months ended June 30, 2026 was $11, compared to $17 for the nine months ended June 30, 2025, a decrease of $6, or 35.3%. Cost of sales as a percentage of revenue was approximately 9.6% and 8.8%, respectively, for the three-month periods ended June 30, 2026 and 2025, and was approximately 9.4% and 9.0%, respectively, for the nine-month periods ended June 30, 2026 and 2025. Our cost of sales varied as a result of the number of units that were sold during the periods presented.

General and Administrative Expenses

General and administrative expenses were $6,876 for the three months ended June 30, 2026, compared to $10,314 for the three months ended June 30, 2025, a decrease of $3,438 or 33.3%. General and administrative expenses were $35,100 for the nine months ended June 30, 2026, compared to $39,695 for the nine months ended June 30, 2025, a decrease of $4,595 or 11.6%. General and administrative expenses consist primarily of legal, accounting, and Edgar filing expenses, and varied during the periods presented due to the amount and timing of services provided.

Depreciation and Amortization Expense

Depreciation and amortization expenses currently are not material to our business. Depreciation and amortization expense was $720 for the nine months ended June 30, 2026 as compared to $595 for the nine months ended June 30, 2025.

Research and Development Expenses

Research and development expenses are not currently material to our business. We did not incur research and development expenses in the nine months ended June 30, 2026 or 2025.

Liquidity and Capital Resources

As of June 30, 2026, we had total current assets of $7,998, including cash of $1,291, and current liabilities of $248,258, resulting in a working capital deficit of $240,260. Our current liabilities include accounts payable of $250, and a principal outstanding balance of $226,792 and $21,216 in accrued interest under the short-term related party revolving loan agreements with our president and another principal stockholder that are due on or before June 30, 2027. As of June 30, 2026, we had an accumulated deficit of $335,655 and a total stockholders' deficit of $231,138. We have financed our operations to date from sales of our Reel Guard product, proceeds from our 2014 private placement, and proceeds from the short-term related party revolving loan agreements.

For the nine months ended June 30, 2026, net cash used by operating activities was $35,280 as a result of a net loss of $40,643 and an increase in prepaid expenses of $1,267, offset by depreciation and amortization of $720, a decrease in inventory of $11, an increase in accounts payable of $250, and an increase in accrued interest - related party of $5,649. By comparison, for the nine months ended June 30, 2025, net cash used by operating activities was $31,033 as a result of a net loss of $43,996, offset by depreciation and amortization of $595, a decrease in prepaid expense of $3,358, a decrease in inventory of $17, an increase in accounts payable of $4,520, and an increase in accrued interest - related party of $4,473.

For the nine months ended June 30, 2026, net cash used by investing activities was $2,050 consisting of purchase of a patent. For the nine months ended June 30, 2025, net cash used by investing activities was $2,300, also consisting of purchase of a patent.

For the nine months ended June 30, 2026, we had net cash provided by financing activities of $32,500 consisting of proceeds from the related party revolving loan agreements. For the nine months ended June 30, 2025, we had net cash provided by financing activities of $32,824, also consisting of proceeds from the related party revolving loan agreements.

On January 4, 2021, we entered into a revolving promissory note agreement with our president and principal stockholder that, as amended, provides for total loans of up to $243,100 at an interest rate 3.5% per annum, which is repayable on or before June 30, 2027. We received proceeds under the revolving promissory note of $26,500 and recorded interest expense of $4,811 during the nine months ended June 30, 2026, resulting in principal balances of $192,923 and $166,423, with accrued interest of $18,250 and $13,439, at June 30, 2026 and September 30, 2025, respectively.

On December 1, 2021, we entered into a revolving promissory note agreement with another principal stockholder that, as amended, provides for loans of up to $42,900 at an interest rate of 3.5% per annum, which is repayable on or before June 30, 2027. We received proceeds under the second revolving promissory note of $6,000 and recorded interest expense of $838 during the nine months ended June 30, 2026, resulting in principal balances of $33,869 and $27,869, with accrued interest of $2,966 and $2,128, at June 30, 2026 and September 30, 2025, respectively.

We do not believe we have adequate funds to meet or obligations for the next twelve months from our current cash, the current revolving note agreements, and projected cash flow from operations. Cash flow from operations has not historically been sufficient to sustain our operations without the additional sources of capital described above. Our future working capital requirements will depend on many factors, including our revenues and the expansion of our product lines to include the new Slow-Sinker product, if and when the product is finalized. To the extent our cash, cash equivalents, and cash flows from operating activities and the revolving note agreements are insufficient to fund our future activities, we may need to raise additional funds through additional stockholder loans or private equity or debt financing. We also may need to raise additional funds in the event we determine in the future to effect one or more acquisitions of businesses, technologies, or products. If additional funding is required, we may not be able to obtain additional stockholder loans or effect equity or debt financing on terms acceptable to us or at all.

Cash Requirements

As of June 30, 2026 and September 30, 2025, we did not have any lease obligations or requirements or other agreements requiring a significant commitment of cash.

Off-Balance Sheet Arrangements

As of June 30, 2026 and September 30, 2025, we did not have any off-balance sheet financing arrangements.

Critical Accounting Estimates

There have been no material changes to our critical accounting estimates as previously disclosed in our Annual Report on Form 10-K for the fiscal year ended September 30, 2025.