Annual Report for Fiscal Year Ending June 30, 2026 (Form 20-F)

OPERATING AND FINANCIAL REVIEW AND PROSPECTS

A. Operating Results

Overview

On February 12, 2026 the Company acquired the VIS group, comprising VIS Networks Private Limited, VIS Global PTE Ltd and their subsidiaries; the Vega group, comprising Vega Global Technologies Pty Ltd, which on the same date acquired the Mirragin and Nisus businesses; and Connect Simple Pty Ltd. On the same date the Company's ordinary shares commenced trading on The Nasdaq Global Market. Before the acquisitions the Group had no significant revenue-generating operations. The results for fiscal 2026 include the acquired businesses only from February 12, 2026, approximately four and a half months of trading, and are not comparable with fiscal 2025 or fiscal 2024.

The acquisitions have been accounted for using the acquisition method. The acquisitions have been accounted for provisionally. The purchase price allocations had not been finalized at the date the financial statements were authorized for issue. The identifiable assets acquired and liabilities assumed are recognized at provisional amounts, being management's best estimate of their fair values at February 12, 2026 on the information available. Those amounts start from the balance sheet of each acquired entity at February 12, 2026, adjusted where that information showed that fair value differed from carrying amount, including the measurement of trade receivables net of lifetime expected credit losses, of the investments of VIS Networks Private Limited at fair value and of its work in progress at nil. No intangible assets have been recognized separately from goodwill other than software of $6,312 of the Mirragin group. At the acquisition date the Group recognized goodwill of $237,624,573, which includes the value of the intangible assets of the acquired businesses. The Group will complete the accounting within the measurement period of twelve months from the acquisition date permitted by IFRS 3 and will adjust the provisional amounts retrospectively, recognizing separately from goodwill any intangible assets identified, together with the related deferred tax and amortization from the acquisition date. See Notes 4 and 37 to the financial statements.

Results of operations

The following table summarizes the Group's consolidated results for the years ended June 30, 2026, 2025 and 2024.

$		Fiscal 2026				Fiscal 2025				Fiscal 2024
Revenue			25,852,647				-				-
Other income			213,587				-				-
Cost of materials and services			(16,305,410	)			-				-
Employee benefits expense			(8,521,383	)			-				-
Professional services			(2,863,088	)			(792,020	)			(1,030,920	)
Depreciation and amortization			(186,173	)			(113,370	)			(148,313	)
Share-based payments			(14,313,666	)			-				-
Other operating expenses			(6,597,656	)			(750,461	)			(447,918	)
Operating loss			(22,721,142	)			(1,655,851	)			(1,627,151	)
Finance costs, net of finance income			(1,858,036	)			(317,103	)			(82,755	)
Share of profit of equity-accounted investments			36,688				-				-
Loss on loss of control of subsidiary			-				-				(5,469	)
Loss before income tax			(24,542,490	)			(1,972,954	)			(1,715,375	)
Income tax expense			(113,871	)			-				-
Loss for the year			(24,656,361	)			(1,972,954	)			(1,715,375	)

A discussion of the Group's results of operations for fiscal 2025 compared with fiscal 2024 has been omitted from this annual report. That discussion is included under "Braiin's Management's Discussion and Analysis of Financial Condition and Results of Operations-Results of Operations-Comparison of the years ended June 30, 2025 and 2024" in the Company's final prospectus dated February 2, 2026, filed with the SEC on February 2, 2026 pursuant to Rule 424(b)(4) as part of the Company's registration statement on Form F-1 (Registration No. 333-291410).

Revenue

Revenue for fiscal 2026 was $25,852,647, against nil in fiscal 2025 and fiscal 2024. Substantially all of it was earned by the businesses acquired on February 12, 2026: network infrastructure and managed services in India contributed $15,342,760 and internationally $5,967,585, unmanned systems consulting, training and workforce services $3,952,099, and telecommunications connection services $444,318. Revenue comprised the sale of equipment of $10,073,165, software licences and subscriptions, presented net as agent, of $269,316, annual maintenance and warranty support of $5,461,976, managed, professional and workforce services of $9,603,872 and telecommunications connection services of $444,318.

Had the acquisitions been completed on July 1, 2025, Group revenue for fiscal 2026 would have been approximately $78,292,678 and the loss for the year approximately $24,050,775. These pro forma amounts are unaudited and are not included in the financial statements. They do not reflect the amortization of any intangible assets that may be recognized on completion of the purchase price allocations and are not necessarily indicative of the results that would have been achieved.

Operating expenses

Cost of materials and cost of services were $16,305,410, or 63 percent of revenue, and relate to the hardware, software, subscriptions and subcontracted resources supplied in the network infrastructure, managed services and workforce businesses. Employee benefits expense of $8,521,383 relates principally to the workforce of the acquired businesses.

Share-based payments of $14,313,666 arose on ordinary shares issued to Maxim Group and other advisers, and provided to the broker of the vendors of Mirragin RAS Consulting Pty Ltd, for services in connection with the direct listing and the acquisitions. The shares were measured at $10.17 per share, the price at which an unrelated investor subscribed for shares for cash on February 11, 2026. The charge relates to those specific adviser awards for the direct listing and the acquisitions, which are not expected to recur. Professional services of $2,863,088 (fiscal 2025: $792,020; fiscal 2024: $1,030,920) include the legal, accounting and advisory costs of the listing and the acquisitions, which are also not expected to recur at that scale.

Depreciation and amortization was $186,173 (fiscal 2025: $113,370; fiscal 2024: $148,313). It comprised depreciation of property, plant and equipment and right-of-use assets of $155,948 (fiscal 2025: $83,145; fiscal 2024: $148,313) and amortization of software and related licences of $30,225 (fiscal 2025: $30,225; fiscal 2024: nil). The increase from fiscal 2025 arose in the VIS businesses, whose depreciation from February 12, 2026 was $149,297. Depreciation and amortization of the Braiin corporate segment decreased to $36,876 from $113,370, as depreciation decreased to $6,651 from $83,145 while amortization was unchanged.

Administrative and other expenses were $3,571,971 (fiscal 2025: $725,875; fiscal 2024: $268,307). The increase reflects the inclusion of the acquired businesses from February 12, 2026 and part of the listing and acquisition-related costs.

Impairment losses on financial assets of $734,011 are expected credit losses on the trade receivables of the VIS businesses. They arose principally on bringing those receivables onto the Group's provisioning policy at June 30, 2026.

Remeasurement of financial items was a loss of $941,199. It comprises the loss of $987,972 on the conversion of the Braiin LLC and Raptor300 Inc SAFE notes, less a net gain of $46,773 on other financial assets.

The net foreign exchange loss of $1,350,475 (fiscal 2025: $24,586; fiscal 2024: $4,225) arose on monetary items held in currencies other than the functional currency of the Group entity concerned.

Finance costs, income tax and loss for the year

Finance costs were $2,015,909 (fiscal 2025: $317,103; fiscal 2024: $82,755). The increase reflects the $17,900,000 borrowed in fiscal 2026, principally to fund the cash consideration for the acquisitions. Finance costs comprise interest on borrowings and notes of $1,554,299, principally on the Streeterville promissory notes and the Advaitha Note Purchase Agreement. They also include the non-cash unwinding of the discount on the VIS deferred consideration of $445,940. Finance income of $157,873 was interest earned principally by the VIS businesses.

Income tax expense was $113,871, comprising current tax of $432,192 on the taxable profits of acquired subsidiaries and current tax of $226,202 in respect of a prior year of VIS Networks Private Limited, less a deferred tax benefit of $544,523. No tax benefit has been recognized on the losses of the Company, and the share-based payments are not deductible. The reconciliation to the prima facie tax benefit is set out at Note 12 to the financial statements.

The loss for the year was $24,656,361 (fiscal 2025: $1,972,954; fiscal 2024: $1,715,375), of which $24,366,196 is attributable to owners of the Company and $290,165 to non-controlling interests. The basic and diluted loss per share was $0.1512.

Adjusted EBITDA

The loss for the year under IFRS Accounting Standards was $24,656,361. Management also uses Adjusted EBITDA, a measure not prescribed by IFRS Accounting Standards, to assess the operating performance of the Group and of the businesses acquired on February 12, 2026. Adjusted EBITDA is loss for the year before income tax, finance costs, finance income and depreciation and amortization, adjusted to exclude share-based payments, fair value losses on financial instruments, net foreign exchange gains and losses, listing and transaction costs, and the loss on loss of control of a subsidiary. Share-based payments of $14,313,666 arose on ordinary shares issued to advisers for services in connection with the direct listing and the acquisitions; they are non-cash, and management does not expect awards of that kind to recur. Only those adviser awards are excluded. Share-based compensation to directors and officers is expected to be a recurring cost of the Group: the Company has committed to equity awards of $5,150,000 that will be granted once an equity incentive plan is adopted (see Item 6.B), and the expense on those awards and on any later awards will not be excluded from Adjusted EBITDA. Fair value losses on financial instruments of $941,199, principally the loss on conversion of the SAFE notes, are included in the remeasurement of financial items of $1,063,659 and arise from the Group's financing rather than its trading. The impairment of trade receivables of $122,460, also included in that line, is not excluded. Net foreign exchange losses of $1,350,475 arise principally on the retranslation of balances held by Group entities in currencies other than their functional currency; they will recur while those balances are held, but depend on exchange rates rather than operating performance. Listing and transaction costs of $3,640,118 are the costs of the direct listing and of the acquisitions completed on February 12, 2026; costs of this kind may arise again on future acquisitions. Management considers that excluding these items shows the trading performance of the businesses more clearly from period to period. They are real costs of the Group, and Adjusted EBITDA should be read together with the loss for the year.

Adjusted EBITDA includes the impairment losses on financial assets of $734,011 recognized in the year, arising principally on bringing the trade receivables of the acquired businesses onto the Group's provisioning policy at June 30, 2026. The loss allowance of $1,971,919 on the receivables acquired was recognized at the acquisition date and is reflected in goodwill, not in the result for the year. Adjusted EBITDA uses revenue as reported under IFRS Accounting Standards, and no adjustment is made to revenue in calculating it. Reported revenue includes only services performed from February 12, 2026: $1,752,576 invoiced after that date for services performed before it was included in the balances acquired, and $1,002,470 of services performed but not invoiced at June 30, 2026 was recognized as revenue.

Adjusted EBITDA is not a measure of performance under IFRS Accounting Standards and should not be considered in isolation or as a substitute for loss for the year or for net cash used in operating activities. It excludes significant costs, including depreciation and amortization and the Group's finance costs, and other companies may calculate similarly titled measures differently. The following table reconciles loss for the year, the most directly comparable measure under IFRS Accounting Standards, to Adjusted EBITDA.

$		Fiscal 2026				Fiscal 2025				Fiscal 2024
Loss for the year			(24,656,361	)			(1,972,954	)			(1,715,375	)
Income tax expense			113,871				-				-
Finance costs			2,015,909				317,103				82,755
Finance income			(157,873	)			-				-
Depreciation and amortization			186,173				113,370				148,313
EBITDA			(22,498,281	)			(1,542,481	)			(1,484,307	)
Share-based payments			14,313,666				-				-
Fair value losses on financial instruments			941,199				-				175,386
Net foreign exchange loss			1,350,475				24,586				4,225
Listing and transaction costs			3,640,118				-				-
Loss on loss of control of subsidiary			-				-				5,469
Adjusted EBITDA			(2,252,823	)			(1,517,895	)			(1,299,227	)

Management also uses Adjusted EBITDA on a pro forma basis, as if the acquisitions completed on February 12, 2026 had occurred on July 1, 2025. Pro forma Adjusted EBITDA is calculated from the unaudited pro forma loss for the year of $24,050,775 set out under "Revenue" above, which includes the results of the acquired businesses from July 1, 2025, and is adjusted for the same items as Adjusted EBITDA, together with the following amounts recognized by the acquired businesses for the period from July 1, 2025 to February 12, 2026, before they were owned by the Group: income tax, finance costs, depreciation and amortization, losses on disposal of investments they held and transaction costs they incurred in connection with the acquisitions. It does not reflect the amortization of any intangible assets that may be recognized on completion of the purchase price allocations, and is not indicative of the results that would have been achieved had the acquisitions occurred on July 1, 2025, or of future results. The following table reconciles the unaudited pro forma loss for the year to pro forma Adjusted EBITDA.

$		Fiscal 2026
Pro forma loss for the year (unaudited)			(24,050,775	)
Income tax			113,871
Finance costs, net of finance income			1,858,036
Depreciation and amortization			186,173
Income tax, finance costs and depreciation and amortization of the acquired businesses, July 1, 2025 to February 12, 2026			1,089,043
Share-based payments			14,313,666
Fair value losses on financial instruments			941,199
Net foreign exchange loss			1,350,475
Listing and transaction costs			3,640,118
Loss on disposal of investments held by the acquired businesses, July 1, 2025 to February 12, 2026			427,718
Transaction costs incurred by the acquired businesses in connection with the acquisitions, July 1, 2025 to February 12, 2026			337,609
Pro forma Adjusted EBITDA			207,133

Segment results

The Group has four reportable segments, described at Note 6 to the financial statements. The results of the three segments comprising the acquired businesses are for the period from February 12, 2026 to June 30, 2026 and include no amortization of acquired intangible assets other than on software of $6,312 of the Mirragin group, no other intangible assets having been recognized separately from goodwill pending completion of the purchase price allocations.

$		Revenue				Operating result				Result for the period
Braiin corporate			145,885				(22,099,141	)			(23,952,171	)
VIS			21,310,345				(1,443,710	)			(1,323,854	)
Vega			3,952,099				768,104				566,059
Connect Simple			444,318				53,605				53,605
Total			25,852,647				(22,721,142	)			(24,656,361	)

Braiin corporate carries the share-based payments for services, the listing and acquisition costs, the finance costs of the Group's borrowings and the deferred consideration. In the post-acquisition period VIS recorded an operating loss of $1,443,710, and Vega and Connect Simple recorded operating profits of $768,104 and $53,605 respectively.

Foreign currency

The Group reports in United States dollars and operates in nine functional currencies. The exchange loss on translating foreign operations recognized in other comprehensive income was $7,980,043, giving a total comprehensive loss for the year of $32,627,576. The loss arises principally on the goodwill and net assets of the acquired businesses, which are carried in Australian dollars and Indian rupees, both of which weakened against the United States dollar between February 12, 2026 and June 30, 2026. The Group does not hedge these exposures. See Item 11.

Governmental policies

Governmental economic, fiscal, monetary and political policies that have affected, or could materially affect, the Group's operations or investments by United States shareholders include monetary policy in Australia and India, which affects the exchange rates of the Australian dollar and Indian rupee and the cost of the Group's variable rate borrowings; exchange control, withholding tax and dividend distribution rules in India, Oman, the United Arab Emirates and the Philippines, which affect the remittance of cash to the Company; Australian and United States defense, export control and procurement policy; tariffs and trade restrictions affecting hardware components; and the regulation of aviation, data protection and artificial intelligence described at Item 4.B, "Government regulation."

B. Liquidity and Capital Resources

At June 30, 2026 the Group held cash and cash equivalents of $5,667,180 (June 30, 2025: $110,779) and had net current liabilities of $22,039,756. During fiscal 2026 the Group's principal sources of funds were borrowings of $17,900,000, the issue of ordinary shares for cash of $4,999,877 and the cash held by the businesses acquired.

$		Fiscal 2026				Fiscal 2025				Fiscal 2024
Net cash used in operating activities			(4,632,389	)			(1,174,241	)			(663,380	)
Net cash used in investing activities			(9,525,522	)			(24,000	)			(885	)
Net cash from financing activities			19,774,241				711,606				20,336
Net increase / (decrease) in cash and cash equivalents			5,616,330				(486,635	)			(643,929	)
Cash and cash equivalents at the beginning of the year			110,779				577,518				1,202,698
Effect of exchange rate changes			(59,929	)			19,896				18,749
Cash and cash equivalents at the end of the year			5,667,180				110,779				577,518

Net cash used in operating activities was $4,632,389, reflecting receipts from customers of $33,401,342 against payments to suppliers and employees of $37,801,842, together with interest received of $157,873 and income taxes paid of $389,762, and includes the cash costs of the listing and the acquisitions. Net cash used in investing activities was $9,525,522, comprising the acquisition of subsidiaries of $9,156,879, net of cash and cash equivalents acquired of $4,986,058, purchases of property, plant, equipment and intangible assets of $160,953, and investments, deposits and loans to external parties of $207,690. Net cash from financing activities was $19,774,241, comprising proceeds from borrowings of $17,900,000 and from the issue of shares of $4,999,877, less repayments of borrowings of $2,190,392, the principal element of lease payments of $66,655 and interest paid of $868,589.

Indebtedness and other financial liabilities

At June 30, 2026 current borrowings were $23,331,928, including promissory notes of $18,443,032, short-term bank borrowings of $2,252,236 and long-term bank borrowings of $1,714,361 presented as current, and current other financial liabilities were $12,027,726, including deferred consideration on the VIS acquisition of $6,719,772. The long-term bank borrowings are the loan against property to VIS Networks Private Limited from Kotak Mahindra Bank Limited, which is repayable in monthly instalments over ten years from 2022. They are presented as current because the terms of sanction allow the bank to withdraw the facility at any stage without notice, so that at June 30, 2026 the Group did not have the right to defer settlement for at least twelve months after the reporting date. The classification does not arise from any breach of covenant or default. The Group had no non-current borrowings, and non-current other financial liabilities were $4,049,447, comprising deferred consideration of $4,000,602 and security deposits of $48,845.

The two secured promissory notes issued to Streeterville Capital, LLC bear interest at a coupon of 9 percent per annum compounding daily, are repayable in a single amount at maturity on February 12 and March 10, 2027, and are secured over substantially all of the assets of the Company and certain subsidiaries. Approximately $10,181,000 is payable at maturity, against a carrying amount at amortized cost of $8,662,042 at June 30, 2026. The notes must be prepaid by 5% of the proceeds of any fundraising or financing transaction completed while they are outstanding, and any prepayment, repayment or acceleration before maturity requires payment of the interest that would have accrued to maturity. The terms of the notes are summarized at Item 10.C. Under the Advaitha Note Purchase Agreement, as varied by the Deed of Variation and Set-Off, $9,600,000 of principal was scheduled to amortize over the three months from December 2026 to February 2027; the contractual amount payable under the facility on those terms, including interest, was $10,521,600, and its carrying amount at amortized cost at June 30, 2026 was $9,780,990. Under the Deed of Extension dated November 3, 2026 described below, the maturity of the facility was extended to February 11, 2028, with the principal repayable in three monthly instalments from December 11, 2027 to February 11, 2028. The deferred consideration for the VIS acquisition is payable in cash instalments of $7,200,000 in February 2027 and $4,800,000 in February 2028. The bank borrowings of the VIS India sub-group, comprising short-term borrowings of $2,252,236 and the loan against property from Kotak Mahindra Bank Limited, bear interest at variable rates. The facilities are described at Note 33 to the financial statements.

The following table analyzes the Group's financial liabilities by contractual maturity at June 30, 2026 on an undiscounted basis, before giving effect to the Deed of Extension dated November 3, 2026.

$		Not later than 1 year				Later than 1 year				Total
Trade payables			9,152,649				-				9,152,649
Streeterville promissory notes			10,181,177				-				10,181,177
Advaitha note purchase agreement			10,521,600				-				10,521,600
Convertible notes			8,621				-				8,621
Bank and other borrowings			4,882,027				-				4,882,027
Other financial liabilities			12,507,954				4,848,845				17,356,799
Lease liabilities			104,714				270,788				375,502
Total			47,358,742				5,119,633				52,478,375

Going concern and capital requirements

Before giving effect to the Deed of Extension dated November 3, 2026, the Group had obligations of approximately $20.7 million under the Streeterville notes and the Advaitha facility, and deferred consideration of $7.2 million, falling due in the twelve months after June 30, 2026, against cash and cash equivalents of $5,667,180. Its ability to meet those obligations depends on generating operating cash flows from the acquired businesses, refinancing or extending its borrowings, and raising further debt or equity.

Having regard to the matters described at Note 2.5 to the financial statements, including cash flow forecasts for the twelve months from the date on which the financial statements were authorized for issue and the committed financing, the directors have concluded that the going concern basis of preparation is appropriate and that no material uncertainty exists.

Committed and contemplated funding. At the date of this annual report, the Group's committed sources of funding comprise:

(a) a Deed of Extension dated November 3, 2026 with Advaitha Pty Ltd, a related party, which extends the maturity of the $9,600,000 of principal outstanding under the note purchase agreement with Advaitha by twelve months, to February 11, 2028, and replaces its repayment schedule: interest of $115,200 a month (14.4% per annum) is payable monthly in arrears and the principal is repayable in three monthly instalments from December 11, 2027 to February 11, 2028. The non-payment of the instalments previously due from December 2026 to February 2027 is not an event of default, and the existing security continues to apply;

(b) a secured promissory note dated November 3, 2026 issued to Advaitha Pty Ltd, a related party, under which $10,200,000 is to be advanced to the Company on February 1, 2027, secured on the same terms as the Advaitha Note Purchase Agreement and bearing interest at 14.4% per annum, with the principal and accrued interest repayable on February 1, 2028; and

(c) loans totalling $14,000,000 from independent third-party lenders under binding loan agreements dated November 4, 2026 and November 2, 2026, bearing interest at 14.4% per annum and unsecured, which the lenders are irrevocably and unconditionally committed to advance: $5,500,000 on January 1, 2027 and $8,500,000 on February 1, 2027, each repayable with accrued interest twelve months after it is advanced, on January 1, 2028 and February 1, 2028 respectively.

No amount had been drawn under the facilities described in (b) and (c) at the date of this annual report. The loans described in (c) are unsecured and are not subject to any condition precedent. Other financing referred to in the Group's forecasts, including the refinancing or extension of the Streeterville notes, the equity facility for which the Company has entered into a term sheet, and any further issue of equity or debt securities, is contemplated but not committed, and there is no assurance that it will be obtained on acceptable terms or at all. Other than the undrawn facilities of $24,200,000 described above, the Group has no material unused sources of liquidity.

Short-term and long-term requirements. In the twelve months following the date of this annual report, the Group's principal cash requirements are the repayment of the Streeterville notes of approximately $10.2 million in February and March 2027, interest of $115,200 a month under the Advaitha Note Purchase Agreement, the VIS deferred consideration instalment of $7.2 million in February 2027, and working capital. Beyond that period, the Group's principal requirements are the repayment of the $9.6 million of principal under the Advaitha Note Purchase Agreement in three monthly instalments from December 2027 to February 2028, the repayment of the amounts to be advanced under the secured promissory note described in (b) and the loans described in (c), with accrued interest, in January and February 2028, the VIS deferred consideration instalment of $4.8 million in February 2028, the repayment of long-term bank borrowings and lease liabilities, and continued investment in its technology.

In the Company's opinion, its working capital is sufficient for its present requirements, being the twelve months following the date of this annual report. At June 30, 2026 the Group had net current liabilities of $22,039,756, including the Streeterville notes and the Advaitha facility. In forming that opinion, the Company has taken into account the extension of the Advaitha note purchase agreement by twelve months under the Deed of Extension dated November 3, 2026, the undrawn facilities of $24,200,000 described under "Committed and contemplated funding" above, and the operating cash flows of the acquired businesses, as described at Note 2.5 to the financial statements.

The Group had no material commitments for capital expenditure at June 30, 2026 and no off-balance sheet arrangements. It does not use derivative financial instruments. Cash is held principally in the functional currency of the entity holding it, and the transfer of funds from subsidiaries in some jurisdictions may be subject to exchange control, withholding tax or approval requirements.

Restrictions on transfers from subsidiaries.

Our subsidiaries' ability to transfer funds to the Company is subject to the following restrictions:

	●	Dividends by VIS Networks Private Limited may be paid only out of profits under the Indian Companies Act 2013. They are subject to Indian withholding tax of 20 percent plus surcharge and cess, reduced to 15 percent on dividends paid to the Company under the double taxation agreement between India and Australia.
	●	Remittances of profits by the Philippine branch of VIS Networks Private Limited are subject to Philippine branch profit remittance tax of 15 percent.
	●	VIS Global Digital Solutions LLC (Oman) must transfer 10 percent of its net profit to a statutory reserve until the reserve reaches one-third of its share capital.
	●	Visnet Technologies LLC (United Arab Emirates) must transfer 5 percent of its net profit to a statutory reserve until the reserve reaches 50 percent of its share capital.
	●	Distributions by the subsidiaries of VIS Global PTE Ltd that are not wholly owned require the agreement of their other shareholders: VIS Networks UK Limited (83 percent), VIS Global Digital Solutions LLC (54 percent), VIS Global Inc (63 percent), Visnet Technologies LLC (60 percent) and VIS Global Pty Ltd (72.5 percent).
	●	The security arrangements with Streeterville Capital, LLC and Advaitha Pty Ltd restrict the transfer of assets by the grantors to Group entities that are not grantors.

At June 30, 2026, $1,785,534 of the Group's cash and cash equivalents was held by subsidiaries subject to those restrictions. The Company does not expect these restrictions to affect its ability to meet its cash obligations.

The Group's treasury activities are managed by the Chief Financial Officer under policies approved by the Board of Directors. Their objectives are to maintain sufficient liquidity to meet the Group's obligations as they fall due and to preserve capital. Surplus cash is held in bank deposits and in the equity securities and mutual funds described at Item 11. The Group's borrowings bear interest at fixed rates, other than the bank borrowings of the VIS India sub-group, and the Group does not use financial instruments for hedging purposes.

C. Research and Development, Patents and Licenses, etc.

During fiscal 2024 and fiscal 2025, the Company's research and development focused on autonomous aerial robotics, AI and machine-learning analytics, voice and speech recognition, and enterprise resource planning and utility-switching platforms. Its policies emphasized internal capability building, collaboration with external domain experts, and iterative development informed by customer feedback and pilot deployments, using agile methods and cross-functional development. The Group's research and development focus and policy for fiscal 2026 are described at Item 4.B, "Research and development."

Intangible assets increased from $58,386 at June 30, 2025 to $196,593 at June 30, 2026, reflecting additions of $161,190 and software of $6,312 acquired with the Mirragin group, less amortization of $30,225, together with exchange differences of $930. Pending completion of the purchase price allocations, no intangible assets other than that software have been recognized separately from goodwill on the acquisitions completed on February 12, 2026. The value of the technology, intellectual property and customer relationships of the businesses acquired is carried within goodwill until the purchase price allocations are completed; they are described at Item 4.B.

D. Trend Information

The Group's results for fiscal 2026 include the acquired businesses only from February 12, 2026. Fiscal 2026 is therefore not comparable with fiscal 2025 or fiscal 2024 and does not represent a full year of the Group as presently constituted. The first full year of contribution from the acquired businesses will be fiscal 2027.

The most significant trends and uncertainties known to management are the conversion of the order book and pipeline described at Item 4.B and of the remaining performance obligations disclosed in the financial statements; continued demand for network infrastructure, systems integration, managed services and unmanned systems in the Group's principal markets; the requirement to refinance, repay or extend the promissory notes maturing in February and March 2027; the cost of operating as a listed company; and movements in the nine currencies in which the Group operates.

The business developments announced during May and June 2026 are described at Item 4.B, "Recent Developments." Since June 30, 2026 the Company has launched ARIA and entered into the Muval partnership, each described at Item 4.B, "Recent Developments." There have been no other material developments or known trends since June 30, 2026.

Industry trends in the Group's principal markets are, in management's view, favorable to its network infrastructure, systems integration and unmanned systems activities, although there is no assurance that the Group will benefit from them:

Enterprise technology spending. Gartner forecasts information technology spending in India of $176.3 billion in 2026, an increase of 10.6 percent on 2025, with spending on data center systems forecast to grow by 20.5 percent and on information technology services by 11.1 percent. Worldwide, Gartner forecasts information technology spending of $6.31 trillion in 2026, an increase of 13.5 percent, led by data center systems. The VIS businesses, which operate in these markets, earned 83 percent of Group revenue in fiscal 2026.

Defense and government demand for uncrewed and autonomous systems. The Australian Government's 2026 National Defence Strategy and Integrated Investment Program, released in April 2026, provide for investment of A$12 billion to A$15 billion in uncrewed and autonomous systems over the decade to 2035-36, and prioritize counter-uncrewed air systems and resilient satellite communications. That program is relevant to the defense and government work of Mirragin and Nisus and to Vega's technology portfolio. The Group has no contract under it.

Commercial drones. Fortune Business Insights estimates the global drone market at $91.9 billion in 2025, growing to $210.3 billion by 2034 at a compound annual rate of 9.6 percent, and the agricultural drone market at $4.4 billion in 2025, growing to $18.0 billion by 2034.

The share-based payment charge of $14,313,666 on the adviser awards for the listing and the acquisitions, and the professional costs of those transactions, recognized in fiscal 2026 are not expected to recur at that scale. This does not apply to share-based compensation generally: the Company has committed to equity awards to directors and officers and expects to make further awards under an equity incentive plan.

E. Critical Accounting Estimates

The preparation of the consolidated financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. The estimates and judgements with the most significant effect on the amounts recognized are set out below and at Note 4 to the financial statements.

There were no material changes in critical accounting estimates during fiscal 2026. The estimates set out below relating to the acquisitions, the measurement of ordinary shares issued at $10.17 per share, goodwill impairment and deferred tax arose for the first time in fiscal 2026 as a result of the acquisitions completed on February 12, 2026. The provisional amounts recognized for the acquisitions may be adjusted retrospectively within the twelve-month measurement period permitted by IFRS 3 when the purchase price allocations are completed, as described below and at Note 37 to the financial statements.

Accounting for the acquisitions completed on February 12, 2026. The identification of the accounting acquirer, the measurement of the ordinary shares issued as consideration at $10.17 per share, the attribution of the remaining 20.30 percent of the VIS businesses to the owners of the parent rather than to non-controlling interests, the measurement of non-controlling interests at their proportionate share of the identifiable net assets of the acquirees, and the attribution, for financial reporting purposes, of the value of the ordinary shares subscribed for by shareholders of VIS Networks Private Limited to the consideration for the VIS group. Those 4,382,603 ordinary shares (13,147,809 ordinary shares after the 3:1 subdivision effected on April 28, 2026) were issued on February 12, 2026 under a subscription agreement. Measured at $10.17 per share they transferred value of $44,564,937. The subscription was open only to shareholders of the acquiree (IFRS 3.B50(a)), was conditional on the same registration as the acquisition and was completed on the acquisition date (IFRS 3.B50(c)); the shares vested on issue and their release from lock-up does not depend on continued employment (IFRS 3.B55(a)). The value is therefore attributed to the exchange for the VIS group (IFRS 3.37 and IFRS 3.51-52), and is not treated as remuneration for post-combination services (IFRS 3.B54-B55) or as a distribution. The acquisitions have been accounted for provisionally. The purchase price allocations had not been finalized at the date the financial statements were authorized for issue. The identifiable assets acquired and liabilities assumed are recognized at provisional amounts, being management's best estimate of their fair values at February 12, 2026 on the information available. Those amounts start from the balance sheet of each acquired entity at February 12, 2026 and are adjusted where that information showed that fair value differed from carrying amount; the remaining assets and liabilities, principally monetary items, are recognized at their carrying amounts. No intangible assets have been recognized separately from goodwill other than software of $6,312 of the Mirragin group. On completion, any intangible assets identified will be recognized separately from goodwill, together with the related deferred tax, and amortized from the acquisition date, which will increase the depreciation and amortization charge for fiscal 2026 and subsequent years.

Impairment of goodwill. Goodwill of $228,990,580 at June 30, 2026 was tested for impairment on a fair value less costs of disposal basis, by reference to the prices paid in the arm's-length acquisitions of February 12, 2026 together with the non-controlling interests at that date, rolled forward to June 30, 2026 for the time value of money at the U.S. dollar risk-free rate of 4.7% per annum, less costs of disposal estimated from the acquisition-related costs incurred on the acquisitions, of 1.03% for the VIS group, 0.27% for Vega and 0.23% for Connect Simple. The recoverable amount exceeded the carrying amount by $1,684,804 for the VIS group, $154,166 for Vega and $1,379,748 for Connect Simple. A reduction in fair value of 2.6%, 0.2% and 1.4% respectively would, in isolation, cause the recoverable amount to equal the carrying amount. The goodwill of the VIS group was tested at the level of the VIS group, which is the VIS operating segment and the level at which that goodwill is monitored for internal management purposes. See Notes 6 and 26 to the financial statements.

Fair value of ordinary shares issued at $10.17 per share. The charge has been measured at $10.17 per share, the price at which the Company last raised funds, being the price at which an unrelated investor subscribed for shares for cash on February 11, 2026. The same price is used for all ordinary shares issued on February 11 and 12, 2026, as consideration for the acquisitions, under the subscription agreement and for services; the Company's shares had no quoted price before their admission to The Nasdaq Global Market on February 12, 2026. The consideration shares and the subscription shares are subject to lock-up arrangements of up to twenty-four months. The lock-ups are contractual undertakings by the holders that would not pass to a market participant acquiring the shares, so no discount for lack of marketability has been applied. A price 10 percent lower would have reduced the consideration transferred and goodwill by $22,500,165 and the amounts recognized for services settled in shares by $1,482,338.

Recoverability of deferred tax assets. Deferred tax assets are recognized only to the extent it is probable that future taxable profits will be available; IFRS does not use a valuation allowance. At June 30, 2026 the Group recognized deferred tax assets of $1,306,713, all in the VIS entities, comprising tax losses of VIS Networks Private Limited of $622,848 and deductible temporary differences, principally on the loss allowance on trade receivables of $580,369. Of the total, $764,224 was held by those entities at the acquisition date. The principal positive evidence is the history of taxable profits of VIS Networks Private Limited and the forecast profitability of the VIS businesses; the principal negative evidence is the tax losses incurred in fiscal 2026. Deferred tax assets have not been recognized on Australian unused tax losses of $5,614,050 and deductible temporary differences of $2,286,397, because the Australian entities have a history of losses and it is not probable that future taxable profit will be available against which they can be used. See Note 12 to the financial statements.

Revenue recognized over time, including the measurement of progress and the identification of performance obligations in multi-element arrangements.

Lease term and the incremental borrowing rate applied in measuring lease liabilities.

Classification of the promissory notes and the SAFE instruments as liabilities or equity, and their subsequent measurement.

Going concern, which is addressed at Note 2.5 to the financial statements and at Item 5.B.

Identification of cash-generating units and the assumptions used in measuring their fair value less costs of disposal for impairment testing, including the prices paid in the acquisitions, their roll-forward to the reporting date and the costs of disposal.

Accounting standards issued but not yet effective. IFRS 18 Presentation and Disclosure in Financial Statements is effective for annual periods beginning on or after January 1, 2027 and will apply to the Group from the year ending June 30, 2028. It will reorganize the statement of profit or loss into operating, investing and financing categories with required subtotals, require disclosure of management-defined performance measures with a reconciliation to the most comparable IFRS subtotal, and require further disaggregation of administrative and other expenses and of other financial liabilities. It will not change the amounts recognized, net assets or cash flows. The Group is assessing whether the contingent features of its promissory notes fall within the amendments to IFRS 9 and IFRS 7 effective for annual periods beginning on or after January 1, 2026. IFRS 19 will not affect the consolidated financial statements. No other standard issued but not yet effective is expected to have a material effect. See Note 3 to the financial statements.