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

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act 1995. All statements other than statements of historical fact made herein are forward looking. In particular, the statements herein regarding industry prospects and future results of operations or financial position are forward-looking statements. These forward-looking statements can be identified by the use of words such as "believes," "estimates," "could," "possibly," "probably," anticipates," "projects," "expects," "may," "will," or "should" or other variations or similar words. No assurance can be given that the future results anticipated by the forward-looking statements will be achieved. Forward-looking statements reflect management's current expectations and are inherently uncertain. Our actual results may differ significantly from management's expectations. Actual results and outcomes could differ materially for a variety of reasons, including, among others, fluctuations in foreign exchange rates, changes in global economic conditions, tariff and trade policies, reduction in government spending in Defense sector and customer demand and spending, inflation, interest rates, and world events, risks of inventory management, variability in demand, economic and geopolitical conditions and additional or unforeseen circumstances, developments, or events may give rise to or amplify many of these risks.

The following discussion and analysis should be read in conjunction with our consolidated financial statements included herewith and the audited financial statements with their accompanying notes included in our annual report on Form 10-K filed with the U.S. Securities and Exchange Commission on January 29, 2026, as amended on our Form 10-K/A filed with the U.S. Securities and Exchange Commission on February 26, 2026. This discussion should not be construed to imply that the results discussed herein will necessarily continue into the future, or that any conclusion reached herein will necessarily be indicative of actual operating results in the future. Such discussion represents only the best present assessment of our management.

General Overview

Throughout these discussions, the following terms shall have the meaning set forth below:

"Current Quarter"		Three month period ended April 30, 2026
"Previous Quarter"		Three month period ended April 30, 2025
"Current Six Month Period"		Six month period ended April 30, 2026
"Previous Six Month Period"		Six month period ended April 30, 2025

We have organized our operations into three segments: Marine Technology Business, Acoustics Sensors and Materials Business and Defense Engineering Services Business. These segments reflect the way the Company evaluates its business performance and manages its operations. See Item 1 of Part 1 "Financial Statements - Note 15 - Segment Analysis."

We sell our products and services internationally, with $5,231,403 or 75.8% of our consolidated net revenues for the Current Quarter, generated outside the United States. Our results of operations are affected by macroeconomic conditions, including changes in inflation and interest rates, as well as global economic and geopolitical developments. These developments include disruptions in trade caused by embargoes or blockades of major shipping routes, shifts in global tariff structures, significant changes in trade and funding policies, and other world events. Such factors can have both direct and indirect impacts on our business that are difficult to isolate or quantify.

These conditions may adversely affect customer demand for our products and services and reduce the predictability of customer spending patterns, which in turn may impact on our ability to forecast overall demand. We expect some or all of these factors to continue to influence our operations during fiscal year 2026.

Factors Affecting our Business in the Current Quarter

The following are some of the most critical factors that affected our business during the Current Quarter. Our annual report on Form 10-K as amended on Form 10-K/A for the fiscal year ended October 31, 2025, contains additional factors that are hereby deemed incorporated by reference.

Business Disruption caused by the ongoing Iranian Conflict and the closure of the Strait of Hormuz

We operate in global markets, and our results are affected by macroeconomic conditions and geopolitical developments that influence customer demand, supply chain reliability, and overall business activity. In the Current Quarter, $5,231,403 or 75.8% of our consolidated net revenues were generated outside the Americas.

In the Current Quarter, geopolitical instability has had a direct impact on our business. The ongoing conflict involving Iran and the resulting instability in the Middle East have adversely affected customer activity in regions that are significant to our Marine Technology Business. A substantial portion of our customer base for this segment is located in the Middle East and Asia. The conflict, combined with the effective closure of the Strait of Hormuz-through which a significant portion of global maritime shipping transits-has disrupted commercial activity and reduced demand for our products and services.

Revenues from Asia and the Middle East for the Group in the Previous Quarter was $2,770,898 compared to $2,046,989 in the Current Quarter, representing a decrease of 26.1%. The uncertainty caused by the conflict and the regional standoff has contributed to lower order intake, delays in contract awards, and the postponement of customer projects. These conditions have also resulted in higher raw material costs, increased operational overhead, and extended lead times for core components, which have slowed progress on customer programs. These disruptions may impair our ability to meet customer demand, maintain production schedules, or operate efficiently.

We expect some or all of these macroeconomic and geopolitical factors to continue to influence our operations during fiscal year 2026.

Volatility in Global Trade Policy Including Geopolitical Uncertainties

We sell our products and services globally, and a significant portion of our revenue is generated from international markets. Changes in U.S. trade policy that restrict the free flow of goods and services may reduce global demand for our offerings and contribute to uncertainty in the markets in which we operate. Recent shifts in U.S. trade policy have increased volatility in global trade conditions. Our revenue mix includes both product sales and rentals, with rental activity closely linked to offshore project development. Following changes in U.S. Administration policy regarding funding for offshore renewable energy programs, we have experienced reduced demand for rental equipment and related services from certain European customers who had been down-selected to develop offshore renewable projects in the United States. In addition, some of the products we sell into the U.S. market are manufactured in the United Kingdom. As a result, changes in trade policy, tariffs, customs requirements, or cross-border regulatory frameworks may affect our cost structure, supply chain efficiency, and the competitiveness of our products in the U.S. market. These factors collectively contribute to uncertainty in customer purchasing behavior and may adversely affect our ability to forecast demand and operate efficiently. Under the newly introduced tariff structure, we are subject to a 10% tariff on items imported into the United States from the United Kingdom, where most of our products are manufactured. In the Current Quarter approximately 20.2% of our Marine Technology Business revenues was generated from sales made in the USA and therefore exposed to tariffs.

Currency Fluctuation/Foreign Exchange Risks

The Company has operations in the UK, USA and Denmark and the financial transactions of these companies are conducted primarily in local currencies. The results of operations, our intercompany balances associated with our international operations, products and service offerings are exposed to foreign exchange rate fluctuations. Due to these fluctuations, operating results may differ materially from expectations, and we may record significant gains or losses on the remeasurement of intercompany balances (such as assets and liabilities). We also hold cash and cash equivalents in foreign currencies such as British Pounds, Euros and Danish Kroner. When the U.S. Dollar strengthens compared to these currencies, cash equivalents when translated, may be materially less than expected and vice versa. In the Current Quarter, the USD weakened against the British Pound and Danish Kroner, which resulted in direct cost of sale and also total operating expenses of our foreign subsidiaries when translated into USD for reporting purposes being higher. The impact of currency fluctuations is discussed more fully below under "Inflation and Foreign Currency". See also Note 5 (Foreign Currency Translation) to the unaudited Consolidated Financial Statements and the section of this report which concerns "Inflation and Foreign Currency".

Concentration of Business Opportunities Where the Sales Cycle is Long and Unpredictable

The Defense Engineering Services Business revenues are highly concentrated and are mostly generated from sub-contracts with a small number of Prime Defense Contractors. The sales cycle is generally protracted, and this may affect quarterly revenues. It is also dependent on the federal government appropriating budget for Defense projects and where the federal government is unable to find consensus in the U.S. Congress or there is a change in spending priorities, this may affect the timely award of sub-contracts from Prime Defense Contractors to our Defense Engineering Services Business, which is reliant on these awards. Furthermore, our core business, the Marine Technology Business, key opportunities are in the Defense Market for both its imaging sonars and the DAVD technology, both of which are key pillars of the Company's growth strategy. Due to the protracted nature of the government procurement process and cycle for Defense spending under federal and/or state budgets, the sales cycle can be long and unpredictable, thus affecting timing of orders and thus quarterly revenues.

Impact on Revenues and Earnings

We are uncertain as to the extent of the impact the factors disclosed above and those in our Form 10-K as amended on our Form 10-K/A covering fiscal year ended October 31, 2025, are likely to have on our future financial results.

Impact on Liquidity, Balance Sheet and Assets

These factors may adversely impact on our availability of free cash flow, working capital and business prospects. As of April 30, 2026, we had cash and cash equivalents of $30,624,337 and cash provided by our operations of $2,047,284. Based on our outstanding obligations and our cash and cash equivalents, as well as our revolving line of credit with HSBC NA, we believe we have sufficient working capital to meet our anticipated cash needs for the next twelve months. However, any projections of future cash flows are subject to substantial uncertainty.

Critical Accounting Policies and Estimates

The Management's discussion and analysis of our financial condition and results of operations are based upon our unaudited consolidated financial statements. These unaudited consolidated financial statements have been prepared in conformity with GAAP in the United States which requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities. By their nature, these estimates and judgments are subject to an inherent degree of uncertainty. We evaluate our estimates based on our historical experience and various other assumptions that are believed to be reasonable under the circumstances. These estimates relate to revenue recognition, the assessment of recoverability of goodwill and intangible assets and the recognition and measurement of deferred income tax assets and liabilities. Actual results could differ from those estimates and may have material effects on our operating results and financial position.

Below is a discussion of accounting policies that we consider critical to an understanding of our financial condition and operating results and that may require complex judgment in their application or require estimates about matters which are inherently uncertain. A discussion of our significant accounting policies, including further discussion of the accounting policies described below, can be found in Note 2, "Summary of Accounting Policies" of our Annual Report on Form 10-K for the fiscal year ended October 31, 2025, as amended on Form 10-K/A.

Revenue Recognition

Our revenues are earned under formal contracts with our customers.

Our Marine Technology Business revenues are derived from both sales and rental of underwater solutions for imaging, mapping, survey applications and diving. PAL's revenues are derived from sales of acoustic sensors, materials and calibration services, and for our Defense Engineering Services Business for engineering services performed for third party customers who are primarily Defense Contractors. Our contracts do not include the possibility for additional contingent consideration so that our determination of the contract price does not involve having to consider potential additional variable consideration. Our product sales do not include a right of return by the customer.

Regarding our Marine Technology Business and PAL, all of our products are sold on a stand-alone basis, and those market prices are evidence of the value of the products. To the extent that we also provide services (e.g., field installation, training, or calibration services etc.), those services are either included as part of the product or are subject to written contracts based on the stand-alone value of those services. Revenue from performing engineering services is recognized when those services have been provided to the customer and evidence of the provision of those services exists.

For further discussion of our revenue recognition accounting policies, refer to Note 2 - "Revenue Recognition" in these unaudited consolidated financial statements and Note 2 "Summary of Accounting Policies" in our Annual Report on Form 10-K and Form 10-K/A for the fiscal year ended October 31, 2025.

Inventory Allowance

We value our inventory based on our cost. We adjust the value of our inventory to the extent our management determines that our cost cannot be recovered due to obsolescence or other factors. In order to make these determinations, our management uses estimates of future demand and sales prices for each product to determine appropriate inventory reserves and to make corresponding reductions in inventory values to reflect the lower of cost or net realizable value. In the event of a higher incidence of inventory obsolescence, we could be required to increase our inventory reserve, which would increase our cost of revenues and decrease our gross profit.

Consolidated Results of Operations for the Current Quarter compared to the Previous Quarter

Our consolidated results of operations include the results of the Company's foreign subsidiaries. Our foreign subsidiaries' results are translated from their respective functional currencies into United States Dollar (USD) for reporting purposes. Currency fluctuations can therefore impact (positively or negatively) on our consolidated results including net revenues, profitability and the value of our assets and liabilities included in the consolidated balance sheet.

During the Current Quarter, the USD weakened against the British Pound and the Danish Kroner, resulting in translated foreign revenues being higher by $193,532 than when using the Previous Quarter exchange rate. In addition, the associated costs of our foreign subsidiaries including cost of revenues and operating expenses when translated from their respective functional currencies into USD for reporting purposes were higher due to the weakening of the USD, (for a discussion of the effect of foreign exchange rates see Item 2 "Inflation and Foreign Currency").

Consolidated net revenues in the Current Quarter decreased by 1.6% and was $6,904,012 compared to $7,017,459 in the Previous Quarter. During the Current Quarter total operating expenses decreased by 18.3% and income from operations increased by 64.8%. Pre-tax income in the Current Quarter was $2,133,652 compared to $1,265,610 in the Previous Quarter, representing an increase of 68.6%. A more detailed analysis of our results of operations is set out below.

A brief summary of the impact of exchange rate fluctuations is shown immediately below:

Revenue Impact - Percentage of Revenue and Costs from our Foreign Subsidiaries:

In the Current Quarter 73.2% of our consolidated net revenue was attributable to the Company's foreign subsidiaries. When translating this amount from the native functional currencies of British Pound and Danish Kroner to USD in the Current Quarter this was $5,051,341 compared to $4,857,809 when using the exchange rate applied in the Previous Quarter and therefore an increase in net revenue of $193,532.

Cost of Revenues and Operating Costs Impact from our Foreign Subsidiaries

In the Current Quarter 68.8% of our consolidated Operating Expenses and Cost of Revenues was attributable to the Company's foreign subsidiaries and this was $3,516,419 ("Foreign Subsidiary Costs") of our total costs of $5,111,036. When translating the Foreign Subsidiary Costs from the native functional currencies of British Pound and Danish Kroner to USD in the Current Quarter this was $117,428 higher when using the exchange rate of the Previous Quarter.

Segment Summary

Marine Technology Business ("Products")

We sell our products internationally (79.8% of sales by our Products Business in the Current Quarter are derived from sales outside of the USA). In the Current Quarter, the Products Business generated $2,839,592 or 41.1% of our consolidated net revenues compared to $3,878,090 or 55.3% in the Previous Quarter, representing a decrease of $1,038,498 or 26.8%. The decrease in revenues is primarily due to the reduced demand for our goods and services caused by the ongoing conflict with Iran and the effective closure of the Strait of Hormuz. Many offshore projects, especially in the Middle East and Asia, have been affected resulting in delays in ongoing projects and in customers' placing orders. In the Current Quarter this has resulted in a decrease in hardware sales, from the strategic region of Asia where sales decreased by 35.3% to $1,423,313 compared to $2,200,282 in the Previous Quarter. Sales derived from the U.S. decreased by 59.7% to $573,083 compared to $1,423,701 in the Previous Quarter, reflecting delays in receiving contract awards under some Defense programs which we are anticipating.

Gross profit margin increased from 67.7% in the Previous Quarter to 77.0% in the Current Quarter primarily due to the mix of sales and the decrease in sales in the Middle East and Asia (resulting in a decrease in commission costs in the Current Quarter). In the Current Quarter we saw increased utilization of our rental assets resulting in an increase in rental revenue by 351.1% to $761,338 compared to $168,791 in the Previous Quarter. In addition, hardware sales from the strategic region of Asia fell by 35.3%, resulting in commission costs decreasing by 68.7% to $114,060 compared to $364,381 in the Previous Quarter.

In the Current Quarter, total operating expenses in the Marine Technology Business decreased by 25.3% to $1,241,359 compared to $1,662,743 in the Previous Quarter. The decrease was primarily driven by favorable foreign currency exchange rate movements resulting from the fluctuation of the U.S. dollar against the British Pound and Danish Kroner, the functional currencies of our foreign subsidiaries. These movements resulted in a foreign currency-related benefit of $88,949 in the Current Quarter, compared to an exchange rate variance expense of $221,198 in the Previous Quarter.

Pre-tax income was $1,216,553 in the Current Quarter compared to $1,055,255 in the Previous Quarter, reflecting a decrease in operating expenses.

Acoustic Sensors and Materials Business ("PAL")

In the Current Quarter, PAL generated $1,525,824 or 22.1% of our consolidated net revenues compared to $1,299,069 or 18.5% of our consolidated net revenues in the Previous Quarter, representing an increase of 17.5%. Gross profit margin was 53.7% in the Current Quarter compared to 65.4% in the Previous Quarter reflecting the mix of sales. Commission costs decreased by 62.0% and were $9,886 in the Current Quarter compared to $26,003 in the Previous Quarter. Total operating expenses were $539,711 compared to $704,189 in the Previous Quarter. Pre-tax income was $310,405 in the Current Quarter compared to $173,871 in the Previous Quarter, reflecting an increase in revenue in conjunction with a decrease in total operating expenses.

Defense Engineering Services Business ("Services")

In the Current Quarter, the Defense Engineering Services Business generated $2,538,596 or 36.8% of our consolidated net revenues compared to $1,840,300 or 26.2% in the Previous Quarter, representing an increase of 37.9%. This increase is attributable to the UK arm of our Defense Engineering Services Business. Gross profit margin increased from 55.5% in the Previous Quarter to 62.0% in the Current Quarter, reflecting the mix of engineering projects. Commission costs increased to $55,128 in the Current Quarter compared to $0 in the Previous Quarter. Total operating expenses increased by 10.3% and were $628,148 compared to $569,435 in the Previous Quarter, as a result of an increase in R&D expenditure in the Current Quarter. Pre-tax income increased in the Current Quarter to $977,387 compared to $477,722 in the Previous Quarter, largely reflecting the increase in revenue, gross profit margins and interest income.

Results of Operations for the Current Quarter compared to the Previous Quarter

Net Revenues: Total consolidated net revenues for the Current Quarter decreased by 1.6% when compared to the Previous Quarter and were $6,904,012 and $7,017,459, respectively. The decrease in consolidated net revenue reflects a 26.8% reduction in revenue from the Marine Technology Business, our core business segment. This business segment primarily works in the marine offshore sector. Due to the ongoing conflict with Iran and the effective closure of the Strait of Hormuz, a large part of its customer base located in the Middle East and Asia have been affected and revenues from those regions decreased by 18.6%. Revenues in both the Defense Engineering Business and PAL increased in the Current Quarter.

Gross Profit Margins: Margin percentage was stronger in the Current Quarter at 66.3% (gross profit of $4,578,049) compared to 64.1% (gross profit of $4,497,281) in the Previous Quarter. In the Current Quarter, gross profit margins in our Marine Technology Business were stronger primarily due to a reduction in hardware sales (decreased by 46.9% to $1,763,606 compared to $3,319,322 in the Previous Quarter); a reduction in sales derived from Asia, resulting in a decrease in commission costs by 68.7% to $114,060 compared to $364,381 coupled with an increase in rental revenue by 351.1%. In the Current Quarter, 61.0% of the total revenues of the Marine Technology Business attracted commission compared to 85.9% of total revenue in the Previous Quarter attracting commission. Gross Profit Margins in the Defense Engineering Business also increased from 55.5% to 62.0%, reflecting the mix of projects in the period presented. Total consolidated commission costs in the Current Quarter were $179,074 compared to $390,384 in the Previous Quarter, representing a decrease of 54.1%, which is primarily attributable to the Marine Technology Business.

Our gross profit margins may vary from period to period due to several factors, including changes in our revenue mix across business segments, product categories, and geographic regions. Key drivers include:

	●	Revenue Mix by Business Segment Gross margins differ across our operating segments. The Marine Technology Business generally yields higher gross margins than the Defense Engineering Services Business and PAL. As a result, the percentage of consolidated net sales attributable to each segment in a given period affects our overall gross margin.
	●	Marine Technology Business Mix Gross margins within the Marine Technology Business vary based on product mix and geography. Sales in certain regions, particularly Asia, often involve commission-based distribution arrangements that reduce margins. Margins also differ between hardware and software sales, with hardware typically generating lower margins and software generating higher margins. In addition, margins vary between custom engineering services and field services performed by our technical support engineers.
	●	Defense Engineering Services Business Revenue in this segment is primarily derived from time-and-materials contracts under Department of Defense subcontracts. These contracts generally yield lower gross margins compared to the Marine Technology Business.
	●	PAL Business PAL supplies acoustic sensors and materials, which typically generate gross margins in the range of 55% to 65%. Actual margins may vary depending on product mix and the proportion of sales completed through sales agents during the reporting period.
	●	Commission Structure All business units utilize sales and distribution agents, and commission levels vary based on product type, geography, and sales volume. A higher proportion of agent-facilitated sales, particularly in Asia for the Marine Technology Business and PAL, may reduce gross margins. See Note 3, "Cost of Revenues," for additional information.
	●	Rental Asset Utilization Gross margins in the Marine Technology Business are also affected by the size and utilization of the rental asset pool. Depreciation expense associated with rental assets may vary depending on investment levels and rental activity.
	●	Engineering Project Mix Within the Defense Engineering Services Business, margins may fluctuate based on the nature of engineering projects performed, including the mix between prototyping, design services, and manufacturing activities.

In the Current Quarter, gross profit margins for the Marine Technology Business were 77.0% compared to 67.7% in the Previous Quarter; for PAL this was 53.7% compared to 65.4%; and for the Defense Engineering Services Business this was 62.0% compared to 55.5%.

Since there are more variable factors affecting gross profit margins in the Marine Technology Business, a table categorizing net revenues generated by this segment in the Current Quarter compared to the Previous Quarter is set out below:

Description		Marine Technology Business ("Products")				Marine Technology Business ("Products")				Percentage Change
Equipment Sales		$	1,763,606			$	3,319,322				(46.9	)%
Equipment Rental			761,338				168,791				351.1	%
Software Sales			134,954				228,053				(40.8	)%
Services			179,694				161,924				11.0	%
Total Net Revenues		$	2,839,592			$	3,878,090				(26.8	)%

Further information on the performance of each business segment, including revenues by type and geography, can be found in Notes 15 (Segment Analysis) and 16 (Disaggregation of Net Revenues) to the unaudited consolidated financial statements for the Current and Previous Quarters.

Research and Development (R&D): R&D expenditures in the Current Quarter decreased by 6.0% and were $648,304 compared to $689,995 in the Previous Quarter. This is largely due to the decrease in this area of expenditure in the Marine Technology Business.

●

Marine Technology Business

During the Current Quarter, research and development ("R&D") expenses in our Marine Technology Business decreased by 19.3% to $456,067 compared to $565,385 in the Previous Quarter. The decrease primarily reflects a reduction in headcount within the R&D function.

R&D expenditures in this business are incurred to support ongoing investment in the development and enhancement of our products and solutions. A significant portion of these costs consists of wages and salaries for engineering and technical personnel. Continued investment in R&D remains essential to our strategy, as innovation is critical to maintaining the competitiveness and technological relevance of our offerings.

●

Acoustics and Materials Business (PAL)

During the Current Quarter, R&D expenses at PAL increased by 16.1% to $110,567 compared to $95,266 in the Previous Quarter. R&D expenditures in this business are incurred to support ongoing investment in the development of acoustic sensors, acoustic materials, and related solutions. A significant portion of these costs consists of wages and salaries for engineering and technical personnel.

●

Defense Engineering Services Business

During the Current Quarter, R&D expenses in the Defense Engineering Services Business increased by 178.3% to $81,670 compared to $29,344 in the Previous Quarter. R&D expenditures in this segment are primarily focused on advancing the Thermite® Octal range of mission-computer products, with the strategic objectives of expanding and diversifying revenue opportunities and improving gross profit margins. The table below sets out the R&D expenditure for each segment for the periods presented: -

		April 30,				April 30,				Percentage
Segment		2026				2025				Change
Marine Technology R&D Expenditure		$	456,067			$	565,385				(19.3	)%
PAL R&D Expenditure		$	110,567			$	95,266				16.1	%
Defense Engineering Services R&D Expenditure		$	81,670			$	29,344				178.3	%

Selling, General and Administrative Expenses (SG&A): SG&A expenses for the Current Quarter decreased by 21.4% to $2,136,769 compared to $2,719,602 in the Previous Quarter. The primary driver of this decrease was favorable foreign currency exchange rate movements. Exchange rate variance adjustments resulted in a benefit of $87,693 in the Current Quarter, compared to an exchange rate variance expense of $312,285 in the Previous Quarter. Non-cash charges represented 9.1% of total SG&A, or $194,259, in the Current Quarter, compared to 24.7%, or $670,542, in the Previous Quarter. These non-cash charges include depreciation, amortization, stock-based compensation, allowance for credit losses, and foreign currency exchange rate variance adjustments.

Stock-based compensation decreased and was a benefit of $13,704 in the Current Quarter compared to an expense of $66,239 in the Previous Quarter.

Key Areas of SG&A Expenditure across the Company for the Current Quarter compared to the Previous Quarter are:

		April 30,				April 30,				Percentage
Expenditure		2026				2025				Change
Wages and Salaries		$	940,733			$	1,050,618				(10.5	)%
Legal and Professional Fees (including accounting, audit, tax and investor relations)		$	381,314			$	375,024				1.7	%
Rent and operating lease		$	7,791			$	18,058				(56.9	)%
Marketing (Excluding associated travel)		$	46,267			$	101,644				(54.5	)%
Travel associated with marketing activities		$	45,889			$	21,294				115.5	%
Office costs		$	210,528			$	166,964				26.1	%

Wages and Salaries - This category decreased in the Current Quarter primarily due to reduced headcount, reflecting ongoing inflationary pressures in the engineering labor market and resulting workforce instability, particularly within the Defense Engineering Services Business. This business experienced elevated staff turnover during the period, contributing to a 17.9% reduction in wages and salaries. We expect wages and salaries to increase materially on a full-year basis in fiscal year 2026 compared to fiscal year 2025. We are currently operating with a reduced headcount and are actively recruiting to fill several vacant positions, including additions to our management team. Some of these hires may also result in incremental costs associated with our succession planning initiatives.

Legal and Professional - This category increased by 1.7% in the Current Quarter reflecting the timing of the performance of certain services such as audit and tax consultancy fees.

Rent and operating lease expenses - We own most of our business premises. This category of expenditure is not material for our business and relates to our Copenhagen office space and the PAL operating lease. The costs of our operating lease reflect Right of Use interest expense.

Marketing and associated travel costs - We incur marketing expenses in connection with the promotion of our products and services. These expenses include wages and salaries for our Digitalization Team, which is responsible for content creation and video production related to our technologies, as well as costs associated with participation in industry trade shows, technology demonstrations, and travel for marketing activities. Marketing expenses decreased in the Current Quarter, primarily reflecting the timing of marketing events and related expenditures. On a full-year basis, we expect marketing expenses for fiscal year 2026 to be generally consistent with the levels incurred in fiscal year 2025.

Overhead related costs as a percentage of net revenue for Current Quarter, compared to the Previous Quarter

General corporate administrative expenses in the Current Quarter were $375,855 or 5.4% of net revenues and $473,230 or 6.7% of net revenues in the Previous Quarter, respectively, which largely reflects a decrease in overheads costs attributable to reduction in our stock-based compensation expense which in the Current Quarter was a benefit of $13,704 compared to an expense in the Previous Quarter of $66,239.

Operating Income: In the Current Quarter operating income increased by 64.8% and was $1,792,976 as compared to $1,087,684 in the Previous Quarter. The increase in operating income reflects the decrease in total operating expenses by 18.3% and which were $2,785,073 compared to $3,409,597 in the Previous Quarter. A significant factor in the decrease in our total operating expense in the Current Quarter is favorable foreign currency exchange rate variance adjustments which resulted in a benefit of $87,693 in the Current Quarter, compared to an exchange rate variance expense of $312,285 in the Previous Quarter.

Other Income: In the Current Quarter, we had "Total Other Income, net" of $340,676 compared to $177,926, representing an increase of 91.5% from the Previous Quarter. The significant components within this category in the Current Quarter are interest earned on our certified deposit account which was $171,915 compared to $145,594 in the Previous Quarter; and gain on the sale of assets (our vessel and a vehicle) of $133,674. See Note 7 (Composition of Certain Financial Statement Captions for more detailed analysis of this). We anticipate that the interest earned in these certified deposit accounts will be material in the future if interest rates remain at similar levels.

Income before income taxes: In the Current Quarter, we had pre-tax income of $2,133,652 compared to $1,265,610 in the Previous Quarter, representing an increase of 68.6%. Pre-tax income increased, largely due to the increase in our "income from operations" and "Total Other Income, net" for the reasons discussed above

Net Income: In the Current Quarter we had Net Income of $1,697,810 compared to $908,762 in the Previous Quarter, representing an increase of 86.8%. In the Previous Quarter we recorded Current Tax Expense of $374,701 compared to $432,203 in the Current Quarter reflecting provision for income tax. We also recorded a Deferred Tax Benefit of $17,853 in the Previous Quarter compared to a Deferred Tax Expense of $3,639 in the Current Quarter, which relates to the cancellation of a stock award. Our effective tax rate is subject to significant variation due to several factors including variability in our pre-tax income and/or loss and the mix of jurisdictions to which such income or losses relate, the applicability of special tax regimes, changes in tax regulations, changes in our stock price, changes in our deferred tax assets and liabilities, their valuation, foreign currency gains (losses). The mix of jurisdictions and related income or losses also affects our tax liability for Global Intangible Low-Taxed Income (GILTI). The changes under the 2025 Tax Act as they relate to GILTI, including the computation method, will be effective for the Company in its 2027 financial statements. The Company's UK subsidiaries have some restricted carry forward losses and annually qualify for R&D Tax credits which are applied to defray a percentage of our income tax liability in the UK.

Comprehensive Income. Comprehensive income for the Current Quarter was $1,256,263, compared to $2,709,201 in the Previous Quarter. Comprehensive income is affected by fluctuations in foreign currency exchange rates, which influence both the translation of foreign-currency-denominated revenues and expenses and the remeasurement of monetary assets and liabilities. These impacts generally represent non-cash gains or losses recognized during the reporting period. A significant portion of the Company's operations is based in the United Kingdom and Denmark; accordingly, a substantial share of our transactions is conducted in British Pounds and Danish Kroner and translated into U.S. dollars for reporting purposes. Note 7 ("Property and equipment by geographic areas") provides additional information on the geographic distribution of our assets. In the Current Quarter, the U.S. dollar strengthened against the British Pound, Danish Kroner, and Euro, resulting in a $441,547 loss from foreign currency translation adjustments, compared to a $1,800,439 gain in the Previous Quarter. Table 1 in the MD&A section titled "Inflation & Foreign Currency" illustrates the impact of these currency movements on our Income Statement and Balance Sheet for the Current Quarter compared with the Previous Quarter.

Results of Operations for the Current Six Month Period compared to the Previous Six Month Period

Net Revenues: Total consolidated net revenues for the Current Six Month Period compared to the Previous Six Month Period increased by 11.3% and were $13,614,124 and $12,227,174, respectively. The primary factors for the increase are attributable to an increase in revenue from the Defense Engineering Services Business by 24.5% or $4,309,946 compared to $3,461,945 in the Previous Six Month Period and which reflects an increase in revenue derived from the UK arm of the Defense Engineering Services Business. PAL also increased revenue in the Current Six Month Period by 19.1% to $3,109,583 compared to $2,611,330 in the Previous Six Month Period, and which reflects an increase in the number of "Acoustic Test Environments" that have been sold in the period presented. The Marine Technology Business revenue in the Current Six Month Period compared to the Previous Six Month Period, was $6,194,595 and $6,153,899, respectively, representing an increase of 0.7%. A key market for Marine Technology Business is the offshore marine market sector in the Middle East and Asia. During the second quarter of the current fiscal year this segment was affected by the ongoing conflict in Iran and the effective closure of the Strait of Hormuz resulting in a steep decrease in order intake and sales emanating from the Middle East and Asia. Furthermore, due to delay in receiving awards from Defense Programs relating to DAVD, revenue from the Americas in the Current Six Month Period in the Marine Technology Business was down by 52.3% or $929,677 as compared to $1,778,337 in the Previous Six Month Period.

Gross Profit Margins: Consolidated Margin percentage was higher in the Current Six Month Period at 65.7% (gross profit of $8,945,083) compared to 64.8% (gross profit of $7,925,751). The main factors which have resulted in the higher consolidated margins in the Current Six Month Period are primarily attributed to the decrease in hardware sales by 20.2% and which were $4,035,486 compared to $5,054,063 in the Previous Six Month Period. As a consequence of the foregoing, commission costs incurred by the Marine Technology Business decreased by 36.1% or $207,326, in conjunction with an increase in the utilization rate of our rental assets resulting in an increase in rental revenue by 283.6% to $1,508,295 in the Current Six Month Period compared to $393,234 in the Previous Six Month Period. Total consolidated commission costs for the Six Month Period were $480,512 compared to $635,893 in the Previous Six Month Period. The ongoing conflict involving Iran and the resulting instability in the Middle East have adversely affected customer activity in regions that are significant to our Marine Technology Business. A substantial portion of our customer base for this segment is located in the Middle East and Asia. The conflict, combined with the effective closure of the Strait of Hormuz-through which a significant portion of global maritime shipping transits-has disrupted commercial activity and reduced demand for our products and services in our second quarter which has impacted revenue in the Current Six Month Period.

Our gross profit margins may vary from period to period due to several factors, including changes in our revenue mix across business segments, product categories, and geographic regions. Key drivers include:

	●	Revenue Mix by Business Segment Gross margins differ across our operating segments. The Marine Technology Business generally yields higher gross margins than the Defense Engineering Services Business and PAL. As a result, the percentage of consolidated net sales attributable to each segment in a given period affects our overall gross margin.
	●	Marine Technology Business Mix Gross margins within the Marine Technology Business vary based on product mix and geography. Sales in certain regions, particularly Asia, often involve commission-based distribution arrangements that reduce margins. Margins also differ between hardware and software sales, with hardware typically generating lower margins and software generating higher margins. In addition, margins vary between custom engineering services and field services performed by our technical support engineers.
	●	Defense Engineering Services Business Revenue in this segment is primarily derived from time-and-materials contracts under Department of Defense subcontracts. These contracts generally yield lower gross margins compared to the Marine Technology Business.
	●	PAL Business PAL supplies acoustic sensors and materials, which typically generate gross margins in the range of 55% to 65%. Actual margins may vary depending on product mix and the proportion of sales completed through sales agents during the reporting period.
	●	Commission Structure All business units utilize sales and distribution agents, and commission levels vary based on product type, geography, and sales volume. A higher proportion of agent-facilitated sales, particularly in Asia for the Marine Technology Business and PAL, may reduce gross margins. See Note 3, "Cost of Revenues," for additional information.
	●	Rental Asset Utilization Gross margins in the Marine Technology Business are also affected by the size and utilization of the rental asset pool. Depreciation expense associated with rental assets may vary depending on investment levels and rental activity.
	●	Engineering Project Mix Within the Defense Engineering Services Business, margins may fluctuate based on the nature of engineering projects performed, including the mix between prototyping, design services, and manufacturing activities.

In the Current Six Month Period, gross profit margins for the Marine Technology Business were 76.1% compared to 69.7% in the Previous Six Month Period; and for PAL this was 60.4% compared to 63.6%; and for the Defense Engineering Business this was 54.6% compared to 57.1%.

Defense Engineering and Services Business (Services Business)

Gross profit margin for the Defense Engineering Services Business was lower at 54.6% in the Current Six Month Period compared to 57.1% in the Previous Six Month Period. This is largely due to the mix of projects undertaken in the period presented coupled with the increase in commission costs incurred in the Current Six Month Period where this was $66,980 compared to $12,765, representing an increase of 424.7%.

Acoustics and Materials Business (PAL)

Gross profit margin for PAL was 60.4% in the Current Six-Month Period compared to 63.6% in the Previous Six-Month Period. The decrease primarily reflects a higher proportion of Acoustic Test Environments sold in the Current Six-Month Period. Commission costs for PAL decreased by 4.6%, totaling $46,782 in the Current Six-Month Period compared to $49,052 in the Previous Six-Month Period.

Marine Technology Business (Products)

In the Current Six Month Period gross profit margins for the Marine Technology Business were 76.1% compared to 69.7% in the Previous Six Month Period. This reflects less hardware sales to Asia due to the ongoing conflict with Iran and the effective closure of the Strait of Hormuz. This has resulted in lower hardware sales; lower sales being facilitated through our agents network and therefore commission costs incurred during the presented period (this was $366,750 in the Current Six Month Period compared to $574,076 in the Previous Six Month Period). Gross margin also improved as a result of a higher utilization rate on rental assets where rental revenue increased by 283.6% and was $1,508,295 in the Current Six Month Period compared to $393,234 in the Previous Six Month Period.

Since there are more variable factors affecting gross profit margins in the Marine Technology Business, a table categorizing net revenues generated by this segment in the Current Six Month Period compared to the Previous Six Month Period is set out below:

		April 30, 2026				April 30, 2025				Percentage
Description		Products				Products				Change
Equipment Sales		$	4,035,486			$	5,054,063				(20.2	)%
Equipment Rental		$	1,508,295			$	393,234				283.6	%
Software Sales		$	344,044			$	348,848				(1.4	)%
Services		$	306,770			$	357,754				(14.3	)%
Total Net Revenues		$	6,194,595			$	6,153,899				0.7	%

Research and Development (R&D): R&D expenditures in the Current Six Month Period was $1,254,406 compared to the $1,233,121 in the Previous Six Month Period, representing an increase of 1.7%.

●

Defense Engineering Services Business

During the Current Six Month Period, the Defense Engineering Services Business R&D expenditure increased by 139.0% and was $180,887 compared to $75,694 in the Previous Six Month Period. R&D expenditures in this segment are primarily focused on advancing the Thermite® Octal range of mission-computer products, with the strategic objectives of expanding and diversifying revenue opportunities and improving gross profit margins.

●

Acoustics and Materials Business (PAL)

During the Current Six Month Periods ending April 30, 2026 and 2025, PAL incurred R&D expenditure of $220,576 and $186,230, respectively, an increase of 18.4%. R&D expenditure is incurred by this business in connection with investments it makes in developing its acoustic sensors, solutions and materials. A significant component of these expenditures comprises wages and salaries.

●

Marine Technology Business

During the Current Six Month Period R&D expenditure in the Marine Technology Business decreased by 12.2% from $971,197 in the Previous Six Month Period to $852,943. R&D expenditures in this business are incurred to support ongoing investment in the development and enhancement of our products and solutions. A significant portion of these costs consists of wages and salaries for engineering and technical personnel. Continued investment in R&D remains essential to our strategy, as innovation is critical to maintaining the competitiveness and technological relevance of our offerings. The table below sets out the R&D expenditure for each segment for the periods presented: -

		April 30,				April 30,				Percentage
Segment		2026				2025				Change
Marine Technology R&D Expenditure		$	852,943			$	971,197				(12.2	)%
PAL R&D Expenditure		$	220,576			$	186,230				18.4	%
Defense Engineering Services R&D Expenditure		$	180,887			$	75,694				139.0	%

Selling, General and Administrative Expenses (SG&A): SG&A expenses for the Current Six Month Period decreased by 1.1% and were $4,887,631 compared to $4,942,924 in the Previous Six Month Period. SG&A comprises both cash and non-cash components. The non-cash component was 15.3% or $750,101 of the total SG&A in the Current Six Month Period compared to 13.9% or $686,774 in the Previous Six Month Period. Non-cash charges comprise Depreciation, Amortization, Stock-based compensation and Exchange Rate Variance charge. Stock-based compensation in the Current Six Month Period was $13,285 compared to $166,383 in the Previous Six Month Period.

Key Areas of SG&A Expenditure across the Group for the Current Six Month Period compared to the Previous Six Month Period are:

		April 30,				April 30,				Percentage
Expenditure		2026				2025				Change
Wages and Salaries		$	1,905,419			$	2,062,569				(7.6	)%
Legal and Professional Fees (including accounting, audit, tax and investor relations)		$	901,575			$	932,078				(3.3	)%
Rent and operating lease		$	26,387			$	51,930				(49.2	)%
Marketing (Excluding associated travel)		$	176,922			$	228,379				(22.5	)%
Travel associated with marketing activities		$	69,940			$	52,496				33.2	%
Office costs		$	423,795			$	335,056				26.5	%

Wages and salaries - In the Current Six Month Period decreased by 7.6% when compared to the Previous Six Month Period. This is primarily due to reduced headcount, reflecting ongoing inflationary pressures in the engineering labor market and resulting workforce instability, particularly within the Defense Engineering Services Business. This business experienced elevated staff turnover during the period, contributing to a 7.6% reduction in our consolidated wages and salaries. We expect wages and salaries to increase materially on a full-year basis in fiscal year 2026 compared to fiscal year 2025. We are currently operating with a reduced headcount and are actively recruiting to fill several vacant positions, including additions to our management team. Some of these hires may also result in incremental costs associated with our succession planning initiatives.

Legal and Professional - The decrease in in this category of expenditures in the Current Six Month Period reflects the timing of these expenses.

Rent - We own most of our business premises and therefore this category of expenditure is not material for our business. The rent obligations relate to our Copenhagen office space and the PAL building lease. This lease is classified as Right of Use (ROU) asset, and these costs are now reflected partly in our depreciation and amortization expenses and remaining ROU Interest expense is within rent and operating lease expenses

Marketing and associated travel costs - We incur marketing expenses in connection with the promotion of our products and services. These expenses include wages and salaries for our Digitalization Team, which is responsible for content creation and video production related to our technologies, as well as costs associated with participation in industry trade shows, technology demonstrations, and travel for marketing activities. Marketing expenses decreased in the Current Six Month Period by 22.5%, primarily reflecting the timing of marketing events and related expenditure. We expect marketing expenses for fiscal year 2026 to be generally consistent with the levels incurred in fiscal year 2025.

Overhead related costs as a percentage of net revenue for Current Six Month Period, compared to the Previous Six Month Period

General corporate administrative expenses in the Current Six Month Period were $980,463 or 7.2% of net revenues and $1,254,538 or 10.3% of net revenue in the Previous Six Month Period, respectively. The decrease in overhead costs is primarily attributable to the decrease in stock compensation expense which was $13,285 in the Current Six Month Period compared to $166,384 in the Previous Six Month Period. For more information on general corporate administrative expenses, please see Note 15 (Segment Analysis).

Operating Income: Our income from our operating activities in the Current Six Month Period was $2,803,046 as compared to $1,749,706 in the Previous Six Month Period which represents an increase of 60.2%. This is due to an increase in our consolidated net revenues, gross profit margins coupled with a small reduction in our total operating costs.

Other Income: In the Current Six Month Period we had "Total Other Income, net" of $517,379 compared to $450,764, representing an increase of 14.8% from the Previous Six Month Period. The significant components of within this category in the Current Six Month Period are interest earned on our certified deposit account which was $344,185 compared to $339,765 in the Previous Quarter; and gain on the sale of assets (our vessel) $133,674. See Note 7 (Composition of Certain Financial Statement Captions for more detailed analysis of this). We anticipate that the interest earned in these certified deposit accounts will be material in the future if interest rates remain at similar levels.

Income before income taxes: In the Current Six Month Period, we had pre-tax income of $3,320,425 as compared to $2,200,470 in the Previous Six Month Period, representing an increase of 50.9%. The increase in pre-tax income is due to the increase in our consolidated net revenue, gross profit and Total Other Income along with a marginal reduction in our total operating costs.

Net Income: In the Current Six Month Period we had Net Income of $2,628,533 as compared to $1,821,737 in the Previous Six Month Period, representing an increase of 44.3%. In the Previous and Current Six Month Periods we recorded Current Tax Expense of $695,419 and $423,575, respectively, reflecting provision for income tax in the respective periods. We also recorded a Deferred Tax Benefit of $3,527 and $44,842 in the Previous and Current Six Month Periods ending April 30, 2026 and 2025, respectively, which relates to the cancellation of stock awards. Our effective tax rate is subject to significant variation due to several factors including variability in our pre-tax income and/or loss and the mix of jurisdictions to which such income or losses relate, the applicability of special tax regimes, changes in tax regulations, changes in our stock price, changes in our deferred tax assets and liabilities, their valuation and foreign currency gains (losses). The mix of jurisdictions and related income or losses also affects our tax liability for Global Intangible Low-Taxed Income (GILTI). In the Current Six Month Period, the U.S. subsidiaries generated 20.7% of our consolidated net revenue. In US we have a combined federal, state and GILTI provision of $159,894. The Company's UK subsidiaries have carryforward losses and R&D Tax credits which are applied to defray a percentage of our income tax liability. We have made provision of $486,145 for tax liability for the UK subsidiaries in our consolidated results for the Current Six Month Period and $49,380 for our Danish subsidiary where the corporation tax rate is 22%.

Comprehensive Income. Comprehensive income for the Current Six-Month Period was $3,299,202, compared to $2,593,590 in the Previous Six-Month Period. Comprehensive income is influenced by fluctuations in foreign currency exchange rates, which affect both the translation of foreign-currency-denominated revenues and expenses, as well as the remeasurement of monetary assets and liabilities. These impacts generally represent non-cash gains or losses recognized during the reporting period. A significant portion of the Company's operations is based in the United Kingdom and Denmark; accordingly, a substantial share of our transactions is conducted in British Pounds and Danish Kroner and translated into U.S. dollars for reporting purposes. Note 7 ("Property and equipment by geographic areas") provides additional context regarding the geographic distribution of our assets. In the Previous Six-Month Period, we recorded a $771,853 gain from foreign currency translation adjustments, compared to a $670,669 gain in the Current Six-Month Period. During the Current Six-Month Period, the U.S. dollar weakened against both the British Pound and the Danish Kroner, the functional currencies of our two foreign subsidiaries. Table 2 in the MD&A section titled "Inflation & Foreign Currency" illustrates the impact of these currency movements on our Income Statement and Balance Sheet for the Current Six-Month Period compared with the Previous Six-Month Period.

Liquidity and Capital Resources

As of April 30, 2026, the Company had an accumulated deficit of $648,028, working capital of $47,727,460, cash of $30,624,337 and stockholders' equity of $61,414,232. For the six months ended April 30, 2026, the Company's operating activities provided $2,047,284 cash.

The Company entered into a $4,000,000 revolving line of credit with HSBC NA on November 27, 2019, at prime. The outstanding balance on the line of credit was $0 as of April 30, 2026. This revolving credit line is reviewed annually and discretionarily renewed by HSBC NA.

We believe our cash flow generated from operations and our cash and cash equivalents as well as our revolving line of credit will be sufficient to meet our anticipated cash needs for the next twelve months. However, any projections of future cash flows are subject to substantial uncertainty.

Inflation and Foreign Currency

The Company and its subsidiaries maintain their accounting records in the functional currencies of their respective jurisdictions, as follows:

	●	U.S. Dollars - United States operations
	●	British Pound - United Kingdom operations
	●	Danish Krone - Danish operations
	●	Australian Dollars - Australian operations (currently dormant)
	●	Indian Rupees - Indian operations (currently dormant)

Our consolidated financial results therefore reflect the translation of these functional currencies into U.S. Dollars. See Note 5 - Foreign Currency Translation to our unaudited consolidated financial statements for additional information on the exchange rates used for balance sheet and income statement translation.

Because our consolidated results include both U.S. and foreign operations, fluctuations in currency exchange rates can affect our reported sales, profitability, and financial position when the financial statements of our foreign subsidiaries are translated into U.S. Dollars. We are also exposed to foreign currency risk on certain receivables and payables denominated in currencies other than the functional currency of the entity involved, including cross-border transactions such as inventory purchases.

In general, our subsidiaries conduct most of their financial transactions in their respective functional currencies. However, from time to time, a subsidiary may enter into transactions denominated in a foreign currency-for example, purchasing inventory from an overseas supplier. In addition, we hold significant cash balances in foreign currencies, including British Pounds, Euros, and Danish Kroner. As a result, movements in exchange rates can impact our cash and cash equivalents, as well as our overall financial position. We cannot predict the extent to which future currency fluctuations may affect our business, and such fluctuations may adversely impact on our sales, profitability, and liquidity.

To provide additional transparency, we present information regarding the effect of changes in foreign exchange rates versus the U.S. Dollar on our net sales, operating expenses, operating income, and certain balance sheet items. This information illustrates how our results for the three- and six-month periods would have differed had foreign exchange rates remained consistent with those in the comparable prior-year periods.

Information for Indian Rupees is not presented separately due to the immaterial level of activity in that jurisdiction; however, INR impacts are included within the consolidated totals.

Table 1: Three Months ended April 30, 2026

		Based British Pounds								Based Danish Kroner								TOTAL USD
		Actual				Constant				Actual				Constant				Actual				Constant				*Total
		Results				Rates				Results				Rates				Results				Rates				Effect
		($)				($)				($)				($)				($)				($)				($)
Net Revenues		$	4,256,571			$	4,116,863			$	794,770			$	740,946			$	5,051,341			$	4,857,809			$	193,532
Costs		$	3,434,893			$	3,322,154			$	74,650			$	69,594			$	3,516,419			$	3,398,991			$	117,428
Net profit from operations		$	821,678			$	794,709			$	720,120			$	671,352			$	1,534,922			$	1,458,818			$	76,104
Assets		$	35,182,070			$	34,321,500			$	1,738,635			$	1,722,935			$	36,930,266			$	36,054,471			$	875,795
Liabilities		$	(4,611,475	)		$	(4,498,676	)		$	(454,926	)		$	(450,818	)		$	(5,079,024	)		$	(4,961,970	)		$	(117,054	)
Net assets		$	30,570,595			$	29,822,824			$	1,283,709			$	1,272,117			$	31,851,242			$	31,092,501			$	758,741

As shown in the table above, the change in exchange rates between the Current Quarter and the Previous Quarter had a favorable impact on our results, increasing net income from operations by $76,104 and increasing net assets by $758,741 for the six-month period since October 31, 2025.

Table 2: Six Months ended April 30, 2026

		Based British Pounds								Based Danish Kroner								TOTAL USD
		Actual				Constant				Actual				Constant				Actual				Constant				*Total
		Results				Rates				Results				Rates				Results				Rates				Effect
		($)				($)				($)				($)				($)				($)				($)
Net Revenues		$	9,465,017			$	8,993,323			$	1,332,721			$	1,214,893			$	10,797,738			$	10,208,216			$	589,522
Costs		$	7,189,015			$	6,830,747			$	179,683			$	163,797			$	7,383,860			$	7,007,627			$	376,233
Net profit from operations		$	2,276,002			$	2,162,576			$	1,153,038			$	1,051,096			$	3,413,878			$	3,200,589			$	213,289
Assets		$	35,182,070			$	34,321,500			$	1,738,635			$	1,722,935			$	36,930,266			$	36,054,471			$	875,795
Liabilities		$	(4,611,475	)		$	(4,498,676	)		$	(454,926	)		$	(450,818	)		$	(5,079,024	)		$	(4,961,970	)		$	(117,054	)
Net assets		$	30,570,595			$	29,822,824			$	1,283,709			$	1,272,117			$	31,851,242			$	31,092,501			$	758,741

As shown in the table above, the change in exchange rates between the Current Six Month and the Previous Six Month had a favorable impact on our results, increasing net income from operations by $213,289 and increasing net assets by $758,741 for the six-month period since October 31, 2025."

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements.