What changed in this filing

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Item 2. Management’s Discussion and Analysis

2024-03-14 compared with 2023-10-13 · 323 added, 272 removed, 37 unchanged (94% of the section changed)

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

Forward-Looking

Management’s Discussion and Analysis of Financial Condition and Results of Operations Forward-Looking Statements

statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives,

6 unchanged sentences

likely result,” and similar expressions.

We intend such forward-looking statements to be covered by the safe-harbor

provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and are including this statement

for purposes of complying with those safe-harbor provisions.

Forward-looking statements are based on current expectations

and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking

We intend such forward-looking statements to be covered by the safe-harbor provisions

for forward- looking statements contained in the Private Securities Litigation Reform Act of 1995 and are including this statement for

purposes of complying with those safe-harbor provisions.

Forward-looking statements are based on current expectations and assumptions

that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements.

Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain.

which could have a material adverse effect on our operations and future prospects on a consolidated basis include, but are not limited

changes in economic conditions, legislative/regulatory changes, availability of capital, interest rates, competition, and generally

accepted accounting principles.

These risks and uncertainties should also be considered in evaluating forward-looking statements and

undue reliance should not be placed on such statements.

We undertake no obligation to update or revise publicly any forward-looking

statements, whether as a result of new information, future events or otherwise.

Further information concerning our business,

including additional factors that could materially affect our financial results, is included herein and in our other filings with the

established Medinotec Capital Proprietary Limited in South Africa as a wholly owned subsidiary, which in turn acquired DISA Medinotec

Proprietary Limited, after successfully proving that a private placement of a minimum of $3 Million was feasible.

Factors which could have a

material adverse effect on our operations and future prospects on a consolidated basis include but are not limited to changes in economic

conditions, legislative/regulatory changes, availability of capital, interest rates, competition, and generally accepted accounting principles.

These risks and uncertainties should also be considered in evaluating forward-looking statements and undue reliance should not be placed

on such statements.

We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new

information, future events or otherwise.

Further information concerning our business, including additional factors that could materially

affect our financial results, is included herein and in our other filings with the SEC.

Medinotec Inc.

established Medinotec

Capital Proprietary Limited in South Africa as a wholly owned subsidiary, which in turn acquired DISA Medinotec, after successfully proving

that a private placement of a minimum of $3 million was feasible.

Medinotec Capital Proprietary

Limited acquired DISA Medinotec Proprietary Limited (therefore establishing the Medinotec Company of Companies), a South African based

medical device manufacturing and distribution company.

In 2018, DISA Medinotec

Proprietary Limited developed its most innovative product to date – the Trachealator.

This award-winning (Medical Design Excellence

Awards – Gold Winner 2021) balloon catheter was developed to address an as-yet unmet supply need in the specialty of advanced airway

management, more specifically tracheal dilation.

That makes this innovative product in our opinion a world first in its ability to dilate

a patient’s airway while maintaining ventilation to the patient without obstructing his/her airway.

life-saving device has quite literally changed the way that tracheal and, to a degree, bronchial stenosis, is managed in extremely ill

This is especially true in a post Covid-19 world where tracheal stenosis due to extended tracheal intubation is becoming an

ever more frequent pathology encountered by surgeons.

The Medinotec Company of

Companies is currently in management’s opinion considered a global leader in tracheal non-occlusive airway dilation technology.

This belief of management was formed on the fact that there are a number of airway dilation balloons that are offered for the management

of tracheal stenosis, but to our knowledge all of them are occlusive in nature.

The fact that the Trachealator is a non-occlusive airway

solution, allowing for continuous ventilation during dilation, results in management believing that we could be regarded as a global

leader in this technology.

products manufactured by The Medinotec Company of Companies include:

Cross PTCA Catheter” The Medinotec Company of Companies also designed and developed a range of semi-compliant coronary

PTCA balloon catheters known as the Cape Cross, which attained a CE Mark and are marketed around the world and in South Africa, becoming

a widely used interventional balloons in the market.

A PTCA balloon catheter (also known as a Plain Old Balloon Angioplasty [“POBA”]

catheter) is inserted either from the groin or the arm and threaded through the blood vessels, through the aorta into the heart.

The cardiac surgeon and/or interventional cardiologist will move the catheter to the blocked artery (plaque).

The balloon part of

the catheter is inflated to open the blockage in the artery, after which the balloon is deflated, and the entire catheter withdrawn

If this procedure is not effective enough to open the artery, a coronary stent will be placed inside the diseased area

of the artery.

“ Cross Non-Compliant (“NC”) ” Catheter On the back of the Cape Cross, the Cape Cross NC Catheter was

developed for post dilation purposes.

The product has become a mainstay of our cardiology range.

It is CE Marked and widely used

in South Africa.

After a stent is placed in an artery, it is followed up by moving a NC catheter to the site where the stent was

The NC catheter balloon part is then inflated inside the stent.

This is done to “seat” the stent inside the artery

In other words, if the stent was not optimally placed, the NC Catheter can be used to make the stent fit “snugly”

against the artery wall to avoid dislodgement and movement of the stent after placement.

“Lamprey” Suction Dissector, a surgical tool used in the fields of neurosurgery, ear, nose and throat (“ENT”)

surgery and general surgery to combine the processes of suctioning blood out of the surgeon’s field of view while allowing

him/her to dissect sensitive structures without having to change instruments.

Aortic Perfusion and Dilation Catheter, a non-occlusive perfusion balloon to allow the expansion of the aortic valve (“BAV”

or Balloon Aortic Valvuloplasty) without impeding the cardiac output, which is currently in the mid stages of research and development

and could potentially be used to post-dilate the artificial valve in Transcatheter Aortic Valve Implantation (“TAVI”),

a rapidly growing market, without the need for pacing.

highly specific, niche Chronic Total Occlusion (“CTO”) Catheter of 1mm in diameter.

This micro balloon catheter addresses

an extremely specific market need for difficult coronary cases and will cement our position as one of the leading specialized coronary

balloon catheter manufacturers in the world.

new self-expanding, temporary, silicone Tracheal Stent to be used in conjunction with the Trachealator in the treatment of tracheal

The complimentary nature of this product will build on our current expertise in the field of advanced airway management.

following distinct and finite developmental phases / stages are applicable to all our product pipeline, namely:

Limited acquired DISA Medinotec (therefore establishing the Medinotec Group of Companies), a South African based medical device manufacturing

and distribution company.

In 2018, DISA Medinotec developed its

most innovative product to date – the Trachealator.

This award-winning (Medical Design Excellence Awards – Gold Winner 2021)

balloon catheter was developed to address an as-yet unmet supply need in the specialty of advanced airway management, more specifically

tracheal dilation.

That makes this innovative product in the Company’s opinion a world first in its ability to dilate a patient’s

airway while maintaining ventilation to the patient without obstructing his/her airway.

This life-saving device has quite

literally changed the way that tracheal and, to a degree, bronchial stenosis, is managed in extremely ill patients.

This is especially

true in a post Covid-19 world where tracheal stenosis due to extended tracheal intubation is becoming an ever more frequent pathology

encountered by surgeons.

In management’s opinion, the

Company is currently considered a global leader in tracheal non-occlusive airway dilation technology.

This belief of management was formed

on the fact that there are a number of airway dilation balloons that are offered for the management of tracheal stenosis, but to the Company’s

knowledge all of them are occlusive in nature.

The fact that the Trachealator is a non-occlusive airway solution, allowing for continuous

ventilation during dilation, results in management believing that the Company could be regarded as a global leader in this technology.

Other products manufactured by the Company

The “Cape Cross PTCA Catheter”:

Company also designed and developed a range of semi-compliant coronary PTCA balloon catheters known as the Cape Cross, which

attained a CE Mark and are marketed around the world and in South Africa, becoming a widely used interventional balloons in the

A PTCA balloon catheter (also known as a Plain Old Balloon Angioplasty [“POBA”] catheter) is inserted either

from the groin or the arm and threaded through the blood vessels, through the aorta into the heart.

The cardiac surgeon and/or

interventional cardiologist will move the catheter to the blocked artery (plaque).

The balloon part of the catheter is inflated to

open the blockage in the artery, after which the balloon is deflated, and the entire catheter withdrawn and removed.

procedure is not effective enough to open the artery, a coronary stent will be placed inside the diseased area of the

Cape “Cross Non-Compliant (“NC”)”

Catheter on the back of the Cape Cross, the Cape Cross NC Catheter was developed for post dilation purposes.

The product has

become a mainstay of our cardiology range.

It is CE Marked and widely used in South Africa.

After a stent is placed in an artery,

it is followed up by moving a NC catheter to the site where the stent was placed.

The NC catheter balloon part is then inflated inside

This is done to “seat” the stent inside the artery wall.

In other words, if the stent was not optimally placed,

the NC Catheter can be used to make the stent fit “snugly” against the artery wall to avoid dislodgement and movement

of the stent after placement.

Aortic Perfusion and Dilation Catheter, a non-occlusive perfusion

balloon to allow the expansion of the aortic valve (“BAV” or Balloon Aortic Valvuloplasty) without impeding the cardiac output,

which is currently in the mid stages of research and development and could potentially be used to post-dilate the artificial valve in

Transcatheter Aortic Valve Implantation (“TAVI”), a rapidly growing market, without the need for pacing.

A highly specific, niche Chronic Total Occlusion (“CTO”)

Catheter of 1mm in diameter:

This micro balloon catheter addresses an extremely specific market need for difficult coronary cases and

may cement in our opinion a position as one of the leading specialized coronary balloon catheter manufacturers in the world.

A new self-expanding, temporary, silicone Tracheal

Stent to be used in conjunction with the Trachealator in the treatment of tracheal stenosis.

The complimentary nature of this product

will build on our current expertise in the field of advanced airway management and provide the surgeon with additional treatment

options for complicated Airway Stenosis cases.

The Epistaxis:

an inflatable non-occlusive balloon nasal catheter has been designed

for fast control of intranasal bleeding.

The preliminary clinical trials conducted were in the Company’s opinion satisfactory.

The following distinct and finite developmental phases / stages

are applicable to all the Company’s product pipeline, namely:

2) Pre-production

4) Production

Mark accreditation

1 unchanged sentence

8) International

sales outside the US

sales outside the United States

510 (k) approval

2 unchanged sentences

Trachealator:

only outstanding phase is the commencement of material sales into the United States.

the necessary preparations have been made (e.g., renting offices, hiring sales and admin

staff) and it is therefore envisaged that sales will begin once all paperwork and compliance

matters are addressed.

While unlocking the United States of America as a commercial market

for the product various Compliance documents and customer registration were completed, these

customers are performing their own in-house clinical overviews of the product.

order for $10,000 was placed during December, 2022 which means commercialization in the United

States of America has started.

Cross PTCA Catheter:

510(k) approval still needs to be obtained.

Cross NC Catheter:

510(k) approval still needs to be obtained.

Suction Dissector:

Testing, Pre-Production Prototyping, Production, Clinical Trials, and CE Marking have all been completed.

Commercialization of this

product have been paused in order to prioritize other products with better commercial prospects.

Perfusion & Dilatation Catheter:

Testing, Pre-Production Prototyping, Testing, Production, Clinical Trials, Application for MDR

CE Mark Accreditation has been submitted.

CTO Catheter:

Testing, Pre-Production Prototyping

Results of Operations for the Three and Six Months

ended August 31, 2023 and 2022

was formed in Nevada and is at the moment a holding company, but it is expected to facilitate the sales of all products in the United

States directly in the near future.

Therefore, over time, as we implement our business plan and realize commercial operations in the

United States, we believe Medinotec Inc.

will become the primary operating company within the Medinotec Company of Companies and the

South African DISA Medinotec Proprietary Limited will be the manufacturing platform for the operations in the United States and other

The Consolidated Medinotec Company of Companies’

revenue for the quarter ended August 31, 2023 was $350,792 compared to $135,879 in revenue being recorded in the comparative

quarter for the prior year.

The Consolidated Medinotec Company of Companies’ revenue for the six months ended August 31, 2023 was

$766,999 compared to $332,350 revenue being recorded in the comparative six months in the prior year.

The revenue was up in comparison to the prior year

with $214,913 for the quarter and up by $434,649 for the six months.

The reason for the higher sales growth in quarter two was due to

demand in the South African region and replenishing of inventory levels by hospitals as well as increased interest and demand in the

products of the Medinotec Company of Companies.

This table indicates the sales per product as a breakdown

of the total revenue balance:

Three months ended (unaudited)

Six months ended (unaudited)

United States of America

Cross NC Catheter

From humble beginnings, the Company is pleased to report that it has supplied

over 400 Trachealators, both in private and academic hospitals throughout the United States of America.

listing registration for Medinotec Inc was obtained.

Cape Cross PTCA Catheter:

Trachealator Catheter

United States of America

Company Sales

Revenue generated by affiliations

to related parties were as follows:

The increase overall for the tracheal or product in both the Outside

and Inside United States territories, is substantiated by the roll out of this product as our lead product in the non-occlusive tracheal

dilation market.

510(k) clearance pending.

Cape Cross NC Catheter:

510(k) clearance pending

OUTFLO Aortic Perfusion Dilatation Catheter

Testing, Pre-Production Prototyping, Testing, Production, Clinical Trials, Application or MDR CE

Mark Accreditation has been submitted.

FDA 510 (K) clearance in progress.

Micro CTO Catheter:

Testing, Pre-Production Prototyping, Clinical Trials MDR/CE Mark accreditation application has

been submitted.

Tracheal Stent:

Epistaxis Catheter

Testing, Pre-Production Prototyping, Testing, Production, Clinical Trials.

of Operations for the Three and Nine Months ended November 30, 2023, and 2022

Medinotec Inc.

was formed in Nevada

and is a holding company and is currently facilitating the sales of all products in the United States directly.

Therefore, over time,

as we implement our business plan and realize commercial operations in the United States, we believe Medinotec Inc.

will become the primary

operating company within the Medinotec Group of Companies and the South African DISA Medinotec will be the manufacturing platform for

the operations in the United States of America and other countries.

The Company’s revenue for the

quarter ended November 30, 2023, was $2,002,547, compared to $387,989 in revenue being recorded in the comparative quarter for the prior

The Company’s revenue for the nine months ended November 30, 2023, was $2,769,547, compared to $720,339 in revenue being recorded

in the comparative nine months in the prior year.

table indicates the sales per revenue stream as a breakdown of the total revenue balance:

Three months ended (unaudited)

Nine months ended (unaudited)

November 30, 2023

November 30, 2022

November 30, 2023

November 30, 2022

Outside of United States of America

Internally Designed/Manufactured Sales

Distribution Agreement Sales

Sales Generated inside the United States of America

Internally Designed/Manufactured Sales

increased in comparison to the prior year by $1,614,558 for the quarter and by $2,049,208 for the nine months.

The reason for the higher

sales growth was due to new distribution agreements the Company entered into.

This led to increased revenues in South Africa.

the Company realized sales for its Trachealator in the United States for the three and nine months ended November 30, 2023, with no such

sales inside the United States for the prior year periods.

increase for the sales category “Internally Designed/Manufactured ”

which includes the Trachealator product in both the outside and inside United States territories, is substantiated by the roll out of

this product as our lead product in the non-occlusive tracheal dilation market and the increase in its popularity and use within these

No revenue was generated by affiliations

to related parties during the three or nine months ending November 30,2023.

Cost of Goods

The Company recorded cost of goods

of $1,138,628 for the quarter ending November 30, 2023, up from $164,685 for the quarter ending November 30, 2022.

For the nine months

ending November 30, 2023, the consolidated entities recorded cost of goods sold of $1,298,116, up from $300,142 for the nine months ending

November 30, 2022.

The most material change in the increase

in the cost of goods, is that it functions in a direct correlation to sales and therefore the cost of goods followed the same upward trend

Due to the fact that distribution

revenues are distributed at lower gross profit margins than internally designed products, there has been a substantial increase in the

cost of goods, which has a direct correlation to the amount of distribution sales generated.

The Rand weakened from an average conversion

17.9 (2022) to 1$:

18.81 (2023) a 5% decline against the US Dollar.

Therefore, even though on the face value it seems like

cost of sales per unit decreased on a three- and nine-month basis from FY 2022 to 2023 it includes a positive conversion adjustment of

approximately $61,435 for the quarter ending November 30, 2023, and a foreign exchange conversion of $69,410 for the nine months ending

November 30, 2023.

The Rand was very volatile against the US Dollar in the past two fiscal reporting periods.

No related party transactions are

recorded in cost of sales for both quarters and nine months ending November 30, 2023 and 2022.

Operating Expenses

The Company’s operating expenses

were $606,009 for the quarter ended November 30, 2023, up from $197,805 for the quarter ended November 30, 2022.

The Company’s operating

expenses were $234,069 for the quarter ended August 31, 2023, down from $259,032 for the quarter ended August 31, 2022.

The Company’s

operating expenses were $510,927 for the six months ended August 31, 2023, up from $417,483 for the six months ended August 31, 2022.

The Rand weakened from an

average conversion rate of 1$:

2023) against the US Dollar.

expenses were $1,116,936 for the nine months ended November 30, 2023, up from $615,288 for the nine months ended November 30, 2022.

The South African Rand weakened from

an average conversion rate of 1$:

17.9 (2022) to 1$:

18.81 (2023) a 5% decline against the US Dollar.

Therefore, this will cause an expense

decrease/improvement of 5% on the operating expenses due to dollar strength within the conversion rate applied.

This is estimated at

a value of $25,748.

After taking into account

the effects of the foreign currency exchange, the remaining changes are mainly attributable to the Sales and Marketing expenses that,

together with the Compliance cost, showed a step cost increase to support the higher sales figure for the six months ended August 31,

Due to the amount of territories entered during the year, there was also an increase in general compliance costs to list products

in these countries and to provide initial training and marketing into these countries.

Limited R&D activities

were conducted in this quarter due to the focus on rolling out the Trachealator in the United States which consumed all production and

testing resources.

This is estimated at a

value of $30,300 for the quarter ending November 30,2023 and $47,800 for the nine months ending November 30,2023.

considering the effects of the foreign currency exchange, the remaining changes are mainly attributable to the General and administrative

expenses that,

together with the Compliance cost, showed a step cost increase to support the higher sales figure mainly due to the new revenue stream

of the cardiology distribution business in South Africa for the nine months ended November 30, 2023.

Three months ended (Unaudited)

Nine months ended (Unaudited)

November 30, 2023

November 30, 2022

November 30, 2023

November 30, 2022

Operating expenses

and amortization expense

and administrative expenses

and development expenses

Total operating expenses

to the number of territories entered during the year, there was also an increase in general compliance costs to list products in these

countries and to provide initial training and marketing into these countries.

Limited R&D activities were

conducted in this quarter due to the focus on rolling out the Trachealator in the United States which consumed all production and testing

R&D activities have resumed and are expected to increase for the rest of the year.

and administrative expenses showed significant growth due increases in payroll costs in the United States, indemnity insurance and

payments made to service providers as part of obtaining our quotation on the OTCQX markets.

Costs relating to the quotation on the OTC

markets that will not be non-recurring in the future is estimated at $30,000 and all other costs will be repeated in the future.

of the major components that affects the operating expenses is the costs of compliance for the business.

These costs increased significantly

as we started to grow our product portfolio and is expected to rise as we enter new sales territories.

Certain costs are once off in

nature and others will be recurring this will be determined after the markets have been entered and all regulatory requirements met.

months ended (unaudited)

*Compliance costs are included

in the General and Admin expenses line item.

Sales and Marketing expenses

was insignificant due to Covid restrictions stopping travel and conferences, this started to normalize in FY 2022 and is expected to

grow significantly in the later end of FY 2023 since the company is in the process of expanding its sales footprint in the United States

of America, the dedicated sales force will continue to grow as new territories pass the compliance hurdles.

and administrative expenses showed significant growth mainly due to increases in independent contractor fees in

the United States and higher staff compliment of 25 sales representatives in for the new Cardiology distribution Revenues.

Other costs included but not as material:

indemnity insurance and payments made to service providers as part of obtaining our quotation on the OTCQX markets and costs relating

to the quotation on the OTC markets that will not be non-recurring in the future are estimated at $30,000 and all other costs will be

repeated in the future.

A future expected major component that affects the operating expenses

is the costs of compliance for the business.

These costs increased significantly as we started to grow our product portfolio and are expected

to rise as we enter new sales territories.

Certain costs are once off in nature and others will be recurring.

This will be determined

after the markets have been entered and all regulatory requirements met.

months ended (unaudited)

Sales and Marketing

Related party expenses included

in operating expenses include Minoan Capital Proprietary Limited for Rental expenses in the third quarter ending was $7,970.

party rental expenses in the same quarter preceding year ending August 31, 2022 amounted to $8,800.

The rent charge

is comparable to rent charged for similar properties in the same relative area.

The company does market research of a Minimum and a Maximum

rental value within the area at every renewal of the rental agreement to ensure this is market related, this exercise is undertaken together

with a registered property agent who has the appropriate knowledge of the area.

ASC 850-10-50-6.

Consolidated Medinotec Company of Companies for the quarter ending August 31, 2023 showed total net loss of $33,164, down from a loss

of $189,648 from the prior quarter ending August 31, 2022.

The Consolidated Medinotec Company of Companies for the six months ending

August 31, 2023 showed total net loss of $10,876, down from a loss of $252,736 from the six months ending August 31, 2022.

The change is mainly attributable

to the higher sales in the Unites States of America, Currency fluctuations, general and Administrative expenses and sales and marketing

expenses which showed a step cost increase to support the higher sales figure, which includes the compliance costs discussed in operating

expenses above which is expected to continue to rise as new planned roll territories become active.

Related party expenses included

in operating expenses include Minoan Capital Proprietary Limited for Rental expenses in the first quarter ending August 31, 2023 was

The related party rental expenses in the same quarter preceding year ending August 31, 2022 amounted to $8,800.

Compliance cost

*Compliance costs are included in the General and Admin

expenses line item.

Sales and Marketing expenses are becoming more significant to

support the new Cardiology Distribution business in South Africa and to support the roll out of the Trachealator, an internally designed

and manufactured product in the United States.

Related party expenses include

$7,797 to Minoan Capital for rental expenses in the quarter ending November 30, 2023.

The related party rental expenses in the quarter

ending November 30, 2022, amounted to $13,957.

The rent charge is comparable

to rent charged for similar properties in the same relative area.

The company does market research of a Minimum and a Maximum rental

value within the area at every renewal of the rental agreement to ensure this is market related, this exercise is undertaken together

with a registered property agent who has the appropriate knowledge of the area.

Interest charged on the

loan account for the quarter ended in favor of related party Minoan Medical Proprietary Limited was $61,054 for the quarter ended August

31, 2023, up from $41,953 in the same quarter ending August 31, 2022.

This change is attributable to an increase in the prime lending

rate and additional draw downs on the loan.

The interest rate chargeable is a guideline determined by the South African Reserve Bank

and gets utilized by financial institutions to determine the financial gain they may derive from a loan.

The Prime rate is therefore

an arm’s length transaction and justifiable rate that can be applied to a loan within the borders of the Republic of South Africa

and therefore complies with the arm’s length definitions in ASC 850-10-50-6.

Liquidity and Capital

Company, as of August 31, 2023, had total current assets of $3,834,207 and total assets in the amount of $4,930,289.

Total current liabilities

as of August 31, 2023 was $123,892.

The Company had

working capital of $3,710,315 as of August 31, 2023.

the research and development phase of this product has been completed, we expect to see an increase in sales being realized against expenditure

incurred, the build out of the United States of America market is evident from the six month loss of $10,876 for the six month period

ended August 31,2023 versus the loss of $252,736 for the comparative period ending August 31,2022.

The company does market research of a minimum and a maximum rental value

within the area at every renewal of the rental agreement to ensure this is market related, this exercise is undertaken together with a

registered property agent who has the appropriate knowledge of the area.

ASC 850-10-50-6.

Net Profit / Loss

The Company showed net losses of $429,371

and $503,248 for the three and nine months ended November 30, 2023, respectively, as compared with net losses of $36,341 and $289,077

for the three and nine months ended November 30, 2022, respectively.

The change is mainly attributable

to the higher sales of the new cardiology distribution business in South Africa and increased sales of the Trachealator, an internally

designed and manufactured product sold in the United States.

under non-operating expenses, a 1% movement in the interest rates constitutes a value of $1,606 on a quarterly basis and $14,454 for the

nine months ending November 30, 2023.

The interest charged for the three and nine months ending November 30, 2023, was $56,645 and $172,889,

respectively.

The interest charged for the three and nine months ending November 30, 2022, was $51,545 and $128,740, respectively.

change is attributable to an increase in the prime lending rate and additional drawdowns on the loan.

The company utilizes a trade finance

facility with a reputable third-party trade finance company in South Africa, the effect of this is recorded in trade receivables and interest

is incurred at prime plus 1% which is market related.

This facility is unsecured, and this facility accounts for the difference in interest

reported as related party and external interest paid within the Interest Expense line item.

The interest rate chargeable is a guideline

determined by the South African Reserve Bank and gets utilized by financial institutions to determine the financial gain they may derive

The Prime rate is therefore an arm’s length transaction and justifiable rate that can be applied to a loan within the

borders of the Republic of South Africa and therefore complies with the arm’s length definitions in ASC 850-10-50-6.

and Capital Resources

of November 30, 2023, the Company had total current assets of $3,594,093 and total assets in the amount of $3,991,950.

Total current

liabilities as of November 30, 2023, were $336,190.

The Company had working capital of $3,257,903 as of November 30, 2023.

comparison, as of February 28, 2023 , the

total current assets of $3,369,487 and total assets in the amount of $4,490,432.

Total current liabilities as of February 28, 2023,

Consolidated, we had working capital of $3,298,167 as of February 28, 2023.

The research and development phase

of the internally designed product lines have largely concluded.

Therefore, we expect to see an increase in sales and marketing expenses,

to build out of the territory of the United States.

Combined with the Cardiology distribution contract business in South Africa.

A private placement was completed

in the wake of the successful research and development (R&D) and subsequent regulatory approval in the prior financial year for $3,467,500

and therefore the Company has enough cash reserves and working capital to fund the roll out in the market of the United States of America

(USA) including new R&D activities and Marketing and Sales functions .

The Company also embarked on obtaining additional distribution contracts in the cardiology field which will further complement its basket

of products within the territory of South Africa, these distribution rights are expected to be granted and transitioned by Sept 2023.

We further expect to grow

distribution revenues in the future which will add to the product basket and ensure more revenue streams with mature profitable products

in the wake of the successful research and development and subsequent regulatory approval in the prior financial year for $3,467,500 and

therefore the Company has enough cash reserves and working capital to fund the roll out in the market of the United States including new

research and development activities and Marketing and Sales functions .

The Company has obtained a significant

distribution revenue stream in South Africa.

These distribution products currently and in the future are expected to add to the product

basket of the business and ensure more revenues are generated in the Company, which consists of more mature but also profitable products

that will complement our in house developed products.

We have cash available on hand and believe that this cash will be sufficient to

fund operations and meet our obligations as they come due within one year from the date these Condensed Consolidated financial statements

In the event that we do not achieve the revenue anticipated in its current operating plan, management has the ability and

commitment to reduce operating expenses as necessary.

Our long-term success is dependent upon our ability to successfully raise additional

capital, market our existing services, increase revenues, and, ultimately, to achieve profitable operations.

Our Unaudited Condensed

Consolidated Financial Statements have been prepared on a going-concern basis, which contemplates the realization of assets and the satisfaction

of liabilities in the normal course of business.

We received FDA 510(k) approval through the substantially equivalence process for Class

II medical devices for our main product being the Trachealator in November 2021.

As the research and development phase of this product

has been completed, we expect to see an increase in sales being realized against expenditure incurred, the build out of the United States

of America market is evident from the small loss of $10,876 for the six months ended August 31, 2023 versus the loss of 252,736 for the

comparative period ending August 31, 2022.

The Company appointed DISA Lifesciences, a South African based sub-distributor,

which already distributes the in house manufactured brands of Medinotec within the market territory of South Africa.

This sub-distributor

will facilitate sales into the territory of South Africa while the main focus of the business unit still remains development of products

for which it owns the IP, while the distributor will perform the sales and marketing functions in this territory.

Sales contributed for

the quarter ending November 30, 2023, is $1,344,803.

The Trachealator product

obtained FDA approval in November 2022, which allowed the Company to sell this product into the United States of America.

Since the Company

had no prior sales channels or infrastructure in the United States, management found it prudent to plan a roll out of the product with

a distributor that had an established network and infrastructure.

For this business, the Company partnered with a company called Innovative

Outcomes and entered into a revolving credit facility to a maximum of $750,000.

Innovative Outcomes would use this to grow both their

own distribution network and infrastructure and also allow for the Company to utilize this network and infrastructure.

However, during

quarter ending November 30, 2023, there was a material change in strategic focus where the Company would require its products to be marketed

to niche surgical units, Innovative Outcomes would be servicing the wound care clinic market only which meant that the future growth of

the combined network and infrastructure would not be a strategic match between the two entities.

It was therefore decided to separate

the network and infrastructure developed and for each company to pursue its strategic focus.

The note receivable will continue on the

same terms and become payable later in the 2024 financial year, but the Company decided to provide full impairment against this receivable

on November 30, 2023.

This decision was made in prudence due to the fact that the receivable is not backed by any Trachealator revenue

streams anymore and does not change that Innovative Outcomes will still be liable for payment of this in the future Interest will accrue

as normal until maturity date.

Should payments be received this provision will be reversed with the same amount of cashflow received.

We have cash available on hand and

believe that this cash will be sufficient to fund operations and meet our obligations as they come due within one year from the date these

Condensed Consolidated financial statements are issued.

In the event that we do not achieve the revenue anticipated in its current operating

plan, management has the ability and commitment to reduce operating expenses as necessary.

Our long-term success is dependent upon our

ability to successfully raise additional capital, market our existing services, increase revenues, and, ultimately, to achieve profitable

Unaudited Condensed Consolidated Financial Statements have been prepared on a going-concern basis, which contemplates the realization

of assets and the satisfaction of liabilities in the normal course of business.

FDA 510(k) approval through the substantially equivalence process for Class II medical devices for our main product being the Trachealator.

During the quarter ending November 30, 2023, the Company also obtained cardiology distribution revenues in South Africa, which significantly

contributed to the overall profitability of the Company.

the research and development phase of most products completed, we expect to see an increase in sales being realized against the sales

expenditure incurred.

Cash Flow movements

Operating activities used

cash of $17,131 during the quarter ended August 31, 2023 compared to $480,779 for the same quarter ended August 31, 2022.

months ending August 31, 2023 operating cash requirements was 281,256 in comparison to $600,000 the 6 months ending August 31, 2022.

This is mainly due to an increase in investment for accounts receivables and inventory combined for the 2022 period and investment in

inventory for the current year these outflows are directly related to supporting the sales initiative in the United States of America.

Since sales significantly increased quarter on quarter.

As the business continues to grow the terms of customers will continue to affect

the growth in accounts receivables while sales grow.

activities was insignificant with a total spend of $18,011 during the quarter ending August 31, 2023 and consumed $1,047 for the prior

quarter ending August 31, 2022.

No investing activities took place for the six months ending August 31,2023 and for the comparative six

months ending August 31, 2022 the group invested $ 29,500 into property plant and equipment.

The investment into property, plant and

equipment peaked in the 2021 Fiscal period as the plant reached maximum potential production its current form.

The new focus will be

on sales and compliance activities as described in the operating expenses section during the quarter ending August 31, 2023.

outflows for new plant will be purely to maintain operating levels and to replace outdated items.

Financing activities provided

cash of $168,110 during the quarter ended August 31, 2023 and $318,608 for the same quarter in the prior year.

For the six months ending

August 31, 2023 financing activities provided funding of $260,901 compared to $3,901,564 in the prior period ending August 31, 2022.

The increase in the prior year is mainly due to the private placement being concluded during which $3,467,500 was raised and capital

raising fees of $169,375 was incurred.

The remaining increases in the current quarter and prior quarter is due to an additional drawdown

on the related party borrowing from Minoan Medical Proprietary Limited.

The loan account in favor of Minoan Medical Proprietary Limited

increased by $476,171 during the quarter ended August 31, 2023.

In the prior year the loan account increased by $318,561 in the quarter

ended August 31, 2022.

Operating activities provided cash

of $101,232 for the nine months ending November 30, 2023, whereas operating activities used cash $848,140 for the nine months ending November

This is mainly due to an increase in sales and profitability with the incorporation of the new Cardiology distribution revenues

in South Africa and the growth of the Trachealator sales in the United States since sales significantly increased year on year and quarter

Financing activities used cash of

$282,552 during the nine months ended November 30, 2023, and provided cash of $4,229,838 for the same quarter in the prior year.

in the prior year is mainly due to the private placement being concluded during which $3,467,500 was raised and capital raising fees of

$169,375 were incurred.

The outflow year to date is due to the part settlement of the related party borrowing from Minoan Medical.

loan account in favor of Minoan Medical decreased by $282,552 during the nine months ended November 30, 2023.

In the prior year the loan

account increased by $931,713 in the nine months ended November 30, 2022.

The loan account is used to fund operational requirements.

loan account in favor of Minoan Medical Proprietary Limited increased to $260,901 for the six months ended August 31, 2023.

Off Balance Sheet Arrangements

As of August 31, 2023, there

were no off-balance sheet arrangements.

Critical Accounting Estimates

critical accounting estimates

are set forth in Note 2 to the Unaudited Condensed Consolidated Financial Statements.

As of November 30, 2023, there were

no off-balance sheet arrangements.

Accounting Policies

critical accounting estimates are set forth in Note 2 to the Unaudited Condensed Consolidated Financial Statements.

are classified as an emerging growth company for our first five fiscal years after obtaining an IPO since our gross revenues does not

1 unchanged sentence

accelerated filer.

We also qualify as a small reporting company since our public float is below $250 Million and less than $100 million

If a company qualifies as a “smaller reporting company,” as defined in Item 10(f)(1) of Regulation S-K, it may

choose to prepare its disclosure

relying on scaled disclosure requirements for smaller reporting companies in Regulation S-K.

With the current information available the

company expects to remain an Emerging Growth Company for at least five years.

Recently Issued Accounting

Pronouncements

The Company does not expect

the adoption of recently issued accounting pronouncements to have a significant impact on the Company’s Consolidated results of

operation, financial position or cash flow.

We also qualify as a small reporting company since our public float is below $250 Million and has less than

$100 million in revenue.

If a company qualifies as a “smaller reporting company”, as defined in Item 10(f)(1) of Regulation

S-K, it may choose to prepare its disclosure relying on scaled disclosure requirements for smaller reporting companies in Regulation

With the current information available the company expects to remain an Emerging Growth Company for at least five years.

Issued Accounting Pronouncements

The Company does not expect the adoption

of recently issued accounting pronouncements to have a significant impact on the Company’s Consolidated results of operation, financial

position, or cash flow.

Quantitative and Qualitative Disclosures about Market Risk

Not applicable

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis