Annual Report for Fiscal Year Ending December 31, 2025 (Form 10-K)

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

The following discussion should be read in conjunction with our audited financial statements for the years ended December 31, 2024 and 2025 and the related notes included elsewhere in this Annual Report on Form 10-K. This discussion contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially from those anticipated in these forward-looking statements.

Overview

HyOrc Corporation ("HyOrc," the "Company," "we," "us," or "our") is currently in the development and early commercialization phase of its business operations. The Company is focused on the development and deployment of proprietary technologies related to energy conversion, waste-to-fuel systems, and engineering and technical services performed through its subsidiaries.

The Company remains in a growth and investment phase. A substantial portion of the Company's balance sheet consists of goodwill and intellectual property assets arising from prior acquisitions and technology development activities. These assets reflect management's strategy of building long-term technology capabilities and project development capacity.

As commercialization efforts progress, the Company expects revenue generation to increase through engineering services, technology licensing, and project development activities.

Results of Operations for the Year Ended December 31, 2025

Revenue

For the year ended December 31, 2025, the Company reported revenue of $130,789. Revenue during the year primarily reflects technical service activities performed through the Company's subsidiary, SRE Power Inc., including engineering and project support services related to power generation projects. Revenue levels remain modest relative to the Company's asset base, reflecting the Company's early-stage commercialization activities and continued focus on project development and technology deployment.

Other Income

The Company recorded other income of $15,559 during the year ended December 31, 2025. Other income consisted primarily of non-operating income items recognized during the period.

Operating Expenses and Adjustments

Operating expenses during the year consisted primarily of professional services, administrative costs, contractor expenses, and public company reporting costs required to maintain regulatory compliance.

In addition, several non-cash adjustments were recorded during the period, including:

	●	Impairment loss: $300,000
	●	Credit loss on accounts receivable and other non-current assets: $95,747
	●	Shares issued for services: $27,463

These non-cash charges reflect management's review of asset recoverability and settlement of certain services through equity instruments.

Net Loss

For the year ended December 31, 2025, the Company reported a net loss of approximately $551,294, compared to a net loss of approximately $1,632,163 for the year ended December 31, 2024.

The improvement in net loss compared to the prior year primarily reflects lower impairment charges and improved expense control relative to the prior reporting period.

Liquidity and Capital Resources

Cash and Cash Equivalents

As of December 31, 2025, the Company had cash and cash equivalents of approximately $19,417, compared to $176,016 as of December 31, 2024.

The decrease in cash reflects ongoing operating expenditures and the Company's limited revenue generation during the period. Net cash flows for the year ended December 31, 2025 were as follows:

Activity		Cash Flow
Net cash used in operating activities		$	(336,057	)
Net cash provided by investing activities		$	10,518
Net cash provided by financing activities		$	168,941
Net decrease in cash		$	(156,598	)

Operating cash outflows primarily reflect corporate operating expenses and working capital movements during the year.

Financing Activities

During the year ended December 31, 2025, the Company raised capital through equity-related financing activities, including:

	●	Proceeds from issuance of common stock: $63,001
	●	Subscriptions received for common stock pending issuance: $105,941

Total financing inflows during the year were $168,941.

Subsequent Financing Activity

Subsequent to year end, the Company completed several financing transactions to support working capital and operational activities.

On January 5, 2026, the Company entered into a Regulation S equity subscription agreement for $50,000, followed by an additional Regulation S equity subscription agreement for $10,000 approximately one week later.

In early March 2026, the Company entered into a $150,000 convertible loan agreement with GS Capital.

These financings are expected to provide additional liquidity to support ongoing operations and business development activities.

Receivables

As of December 31, 2025, the Company reported trade receivables of approximately $237,120.

A portion of the Company's working capital is therefore dependent on the collection of outstanding receivable balances related to engineering services and project-related activities.

Management evaluates the collectability of receivables and recorded a credit loss provision of $95,747 during the year based on its review of recoverability.

Capital Structure

As of December 31, 2025, the Company reported the following equity balances:

Item		Amount
Additional Paid-in Capital		$	29,674,210
Share Capital		$	737,091
Retained Earnings (Deficit)		$	(8,174,862	)

The Company is primarily financed through equity capital and does not currently carry significant long-term debt obligations.

Investments

As of December 31, 2025, the Company reported investment balances of approximately $119,310. These investments represent minor non-core holdings and are not considered a primary focus of the Company's strategic operations.

Assets and Long-Term Investment Strategy

Intangible Assets and Goodwill

As of December 31, 2025, the Company reported:

Asset		Amount
Goodwill		$	15.76 million
Patents		$	3.60 million

These assets represent a significant portion of the Company's total asset base and reflect prior acquisitions and investments in proprietary technology platforms.

The economic value of these assets depends on the Company's ability to generate future economic benefits through commercialization, licensing, and deployment of its technology platform.

Management evaluates the recoverability of goodwill and intangible assets on at least an annual basis, or more frequently if events or changes in circumstances indicate that impairment may exist. The Company's assessment considers qualitative and quantitative factors including the current stage of commercialization of its technology platform, expected future project deployments, licensing opportunities, and projected long-term cash flows associated with planned waste-to-fuel and energy conversion projects.

Although current revenues remain limited as the Company advances its commercialization strategy, management believes that the underlying technology platform and associated intellectual property continue to provide the potential for future economic benefit. Accordingly, management concluded that no impairment of goodwill or patents was required as of December 31, 2025.

Property and Equipment

As of December 31, 2025 the Company reported equipment with a carrying value of approximately $2.62 million.

These assets represent operational equipment and infrastructure intended to support the Company's future project development and commercialization activities.

Project Development Activities

Subsequent to December 31, 2025, the Company entered into a definitive agreement with On Energy and its affiliated entities relating to the development of a waste-to-methanol project in Bulgaria.

The proposed facility is designed to convert pre-processed municipal waste in the form of refuse-derived fuel ("RDF") into low-carbon methanol and is expected to process approximately 56,000 tonnes of RDF annually, supporting potential methanol production of approximately 18,000 to 20,000 tonnes per year.

The Company expects to participate in the project through technology licensing, engineering services, and project development support.

Management believes this project represents an important step in the Company's strategy to deploy its waste-to-fuel technology platform in international markets.

Off-Balance Sheet Arrangements

The Company had no material off-balance sheet arrangements as of December 31, 2025.

Critical Accounting Policies and Estimates

Preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and judgments that affect reported amounts of assets, liabilities, revenues, and expenses.

Significant areas requiring management judgment include:

	●	valuation of goodwill and intangible assets
	●	allowance for doubtful accounts
	●	revenue recognition timing
	●	determination of whether development costs should be capitalized or expensed

Changes in these estimates could materially affect future financial results.

Risks and Uncertainties

The Company faces several risks typical of early-stage commercialization companies, including:

Limited Revenue Base

Current revenues remain modest relative to the Company's asset base and operating structure.

Liquidity Constraints

Limited cash reserves require continued access to capital markets and careful management of operating expenditures.

Intangible Asset Risk

A significant portion of the Company's asset base consists of goodwill and intellectual property whose value depends on successful commercialization.

Receivable Collection Risk

A portion of current assets consists of trade receivables, which exposes the Company to potential credit and collection risk.

Outlook

Management expects gradual revenue growth as commercialization efforts progress and as engineering services and project development activities expand.

The Company's strategic priorities include:

	●	strengthening liquidity through financing activities
	●	improving receivable collections
	●	monetizing intellectual property through licensing and project deployment
	●	maintaining disciplined operating cost control

Conclusion

HyOrc Corporation remains in a transitional stage as it advances from technology development toward broader commercialization.

While the Company currently generates limited revenue and operates with constrained liquidity, management believes the Company's intellectual property portfolio, technology platform, and project development activities provide a foundation for future revenue growth.

Future performance will depend on the Company's ability to successfully commercialize its technologies, secure project financing, and execute its project development strategy.