What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2026-02-17 compared with 2025-11-14 · 220 added, 118 removed, 132 unchanged (72% of the section changed)

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following discussion and analysis of the results of operations and financial condition of Propanc Biopharma, Inc., and its wholly-owned

Australian subsidiary, Propanc PTY LTD (collectively, “Propanc” or the “Company”) as of September 30, 2025 and

for the three months ended September 30, 2025 and 2024 should be read in conjunction with our unaudited financial statements and the

notes to those unaudited financial statements that are included elsewhere in this Quarterly Report on Form 10-Q for the period ended

September 30, 2025 (this “Quarterly Report”).

References in this Management’s Discussion and Analysis of Financial

Condition and Results of Operations section to “us”, “we”, “our” and similar terms refer to Propanc.

This Quarterly Report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended

(the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

The events described in forward-looking statements contained in this Quarterly Report may not occur.

Generally, these statements relate

to business plans or strategies, projected or anticipated benefits or other consequences of our plans or strategies, projected or anticipated

benefits from acquisitions to be made by us, or projections involving anticipated revenues, earnings or other aspects of our operating

Australian subsidiary, Propanc PTY LTD (collectively, “Propanc” or the “Company”) as of December 31, 2025 and

for the six months ended December 31, 2025 and 2024 should be read in conjunction with our unaudited financial statements and the notes

to those unaudited financial statements that are included elsewhere in this Quarterly Report on Form 10-Q for the period ended December

31, 2025 (this “Quarterly Report”).

References in this Management’s Discussion and Analysis of Financial Condition

and Results of Operations section to “us”, “we”, “our” and similar terms refer to Propanc.

This Quarterly

Report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities

Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

The events described

in forward-looking statements contained in this Quarterly Report may not occur.

Generally, these statements relate to business plans

or strategies, projected or anticipated benefits or other consequences of our plans or strategies, projected or anticipated benefits

from acquisitions to be made by us, or projections involving anticipated revenues, earnings or other aspects of our operating results.

The words “aim”, “anticipate”, “believe”, “continue”, “could”, “estimate”,

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Our lead product candidate, PRP, is a variation upon our novel formulation and involves pro-enzymes, the inactive precursors

On August 14, 2025, we closed

an underwritten public offering of 1,000,000 shares of our common stock, par value $0.001 per share, at a price of $4.00 per share.

shares of common stock commenced trading on the Nasdaq Capital Market on August 15, 2025, under the ticker symbol, “PPCB”.

The Company received aggregate gross proceeds of $4 Million from the offering, before deducting underwriting discounts and other related

On September 17, 2025, a certificate of grant for the Company’s “proenzyme composition”

patent was received from the US Patent & Trademark Office (USPTO).

The patent specifically captures a future clinical dose of the

Company’s lead asset, PRP.

This is the fourth US patent granted in this key strategic jurisdiction.

Currently, the Company’s

intellectual property portfolio consists of 90 patents filed in major jurisdictions relating to the use of PRP against solid tumors.

November 4, 2025 (the “Closing Date”), the Company completed a private placement pursuant to a Securities Purchase Agreement

with Hexstone Capital LLC (“Hexstone”).

At closing, Hexstone purchased 100 shares of Series C Preferred Stock, par value

$0.001, with a stated value of $10,000 per share, for total gross proceeds of $1,000,099.

In connection with the transaction, the Company

also issued warrants to purchase up to 9,900 additional shares of Series C Preferred Stock.

December 1, 2025, two provisional patents were filed detailing new methods to treat resistant cancer and fibrosis.

These discoveries

stem from our Joint Research and Drug Discovery program with the Universities of Jaén and Granada in Spain and are expected to

be filed subsequently in key global jurisdictions.

The first provisional patent covers methods for treating cancers that have developed

resistance to chemotherapy and/or radiotherapy.

Despite advancements in cancer therapies, global mortality rates remain high, and strategies

to prevent recurrence are urgently needed.

Treatment failure frequently occurs due to the emergence of multiple malignancies and resistance

to standard therapies, underscoring the need for novel approaches.

The second provisional patent relates to compositions, methods, uses,

and kits for the treatment of fibrosis, particularly organ fibrosis.

Fibrosis is characterized by the excessive accumulation of scar

tissue due to over-deposition of extracellular matrix (ECM) components, leading to stiffening, loss of function, and structural disruption

of affected tissues.

This maladaptive response can result from chronic injury or persistent inflammation and can impact nearly any organ

system, including the lungs, liver, kidneys, and heart—contributing significantly to morbidity and mortality.

Causes may include

chronic inflammation, autoimmune and allergic responses, chemical insults, radiation, and tissue damage.

For example, life expectancy

following myocardial infarction-related scarring ranges from 3 to 8 years (ages 65–74), and for lung fibrosis patients is typically

3 to 5 years.

December 22, 2025, the Company and its joint research partners at the Universities of Jaén and Granada published key findings

in a peer reviewed journal, Scientific Reports, regarding the impact of proenzymes on pancreatic ductal adenocarcinoma (PDAC) fibroblasts.

From the publishers of Nature, Scientific Reports is an online, open access journal, which publishes primary research from all areas

of the natural and clinical sciences.

The article is entitled, “Impact of pancreatic proenzymes on pancreatic ductal adenocarcinoma

associated fibroblasts,” and available online.

The tumor microenvironment (TME) plays a pivotal role in tumor initiation, progression,

and the form of pre-metastatic niches.

PDAC is characterized by a dense fibrotic stroma containing a significant enriched population

of cancer-associated fibroblasts (CAFs).

The interplay between CAFs and tumor cells is crucial in driving tumor advancement and metastasis,

underscoring the potential benefits of novel therapeutic strategies targeting stromal cells to improve patient survival.

PRP, consisting

of two bovine derived pancreatic proenzymes, trypsinogen and chymotrypsinogen, have shown efficacy in cancer treatment.

demonstrate PRP exerts multifaceted effects.

Results underscore the candidacy of PRP as a potential disruptor of the TME.

January 20, 2026, a new provisional patent application was filed for methods of producing trypinsogen and chymotrypsinogen with IP Australia.

The patent application describes an optimized expression system to produce a world-first fully synthetic recombinant version of PRP,

a long-term therapy for the treatment and prevention of metastatic cancer from solid tumors.

A fully synthetic version of trypsinogen

and chymotrypsinogen, called Rec-PRP, could have additional benefits to a global healthcare system that further capitalizes on a new

therapeutic approach to treating cancer.

For example, both proenzymes are synthesized by an in vivo (living organism) expression system,

such as yeast cells, to produce proteins that could be maintained for long periods of time without suffering degradation in the absence

of refrigeration.

This is useful for a longer self-life as well as global distribution, particularly in warmer climates and developing

regions where refrigeration is not available.

Further, the program could produce large quantities of trypsinogen and chymotrypsinogen

for commercial use that exhibits minimal variation between lots and without sourcing from animals.

Therefore, management believes a fully

synthetic recombinant version of PRP would have tremendous implications from a regulatory perspective, but also a practical, commercial

benefit for global distribution.

January 27, 2026, the Company filed a new provisional patent application focusing on innovative formulations of the pancreatic proenzymes,

trypsinogen and chymotrypsinogen— the active components in our lead asset, PRP — addressing critical challenges in stability,

storage, freeze/thaw cycling, and global transport.

These advancements overcome longstanding barriers in developing viable pharmaceutical

compositions of these proenzymes for biomedical applications, including cancer and other chronic diseases.

of Operations

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The results discussed below are of the Company and its wholly-owned Australian subsidiary, Propanc

the Three months ended September 30, 2025, as compared to the Three months ended September 30, 2024.

the three months ended September 30, 2025 and 2024, we generated no revenue because we are currently undertaking research and development

activities for market approval and no sales were generated in this period.

the Three and Six months ended December 31, 2025, as compared to the Three and Six months ended December 31, 2024.

the three and six months ended December 31, 2025 and 2024, we generated no revenue because we are currently undertaking research and

development activities for market approval and no sales were generated in this period.

Administration

expense increased to $4,598,574 for the three months ended September 30, 2025 as compared to $220,759 for the three months ended September

expense increased to $3,628,173 for the three months ended December 31, 2025 as compared to $153,593 for the three months ended December

This increase of approximately $3,475,000 is primarily attributable to the increase in stock-based consulting expenses of approximately

$3,743,000 to various consultants, general consulting, legal and investor relation fees of approximately $487,000, increase in accounting

fees of approximately $30,000, increase of approximately $8,000 in employee remuneration expense, and increase in other general and administrative

expenses of approximately $92,000 related to increase public company expenses and increase in marketing expense of approximately $18,000.

$2,472,000 to various consultants, general consulting, legal, director fees and investor relation fees of approximately $807,000, increase

in accounting fees of approximately $17,000, increase of approximately $79,000 in employee remuneration expense, and increase in other

general and administrative expenses of approximately $85,000 related to increase public company expenses and increase in marketing expense

of approximately $14,000.

Administration

expense increased to $8,226,747 for the six months ended December 31, 2025 as compared to $374,352 for the six months ended December

This increase of approximately $7,852,000 is primarily attributable to the increase in stock-based consulting expenses of approximately

$6,215,000 to various consultants, general consulting, legal, director fees and investor relation fees of approximately $1,293,000, increase

in accounting fees of approximately $48,000, increase of approximately $88,000 in employee remuneration expense, and increase in other

general and administrative expenses of approximately $177,000 related to increase public company expenses and increase in marketing expense

of approximately $31,000.

Expense – Relates Party

expenses increased to $14,789 for the three months ended September 30, 2025 as compared to $8,317 for the three months ended September

This increase of approximately $6,000 is primarily attributable to the increase of monthly rental fees as a result of the lease

renewal with the related party lessor in May 2025.

expenses increased to $6,600 for the three months ended December 31, 2025 as compared to $5,401 for the three months ended December 31,

Occupancy expenses increased to $21,389 for the six months ended December 31, 2025 as compared to $13,718 for the six months ended

December 31, 2024.

This increase in both periods are primarily attributable to the increase of monthly rental fees as a result of the

lease renewal with the related party lessor in May 2025.

and Development Expenses

and development expenses were decreased to $60,201 for the three months ended September 30, 2025 as compared to $61,714 for the three

months ended September 30, 2024, a slight decrease in research and development expenses of approximately $1,500.

and development expenses were decreased to $19,961 for the three months ended December 31, 2025 as compared to $54,388 for the three

months ended December 31, 2024, a decrease in research and development expenses of approximately $34,000 Research and development expenses

were decreased to $80,162 for the six months ended December 31, 2025 as compared to $116,102 for the six months ended December 31, 2024,

a decrease in research and development expenses of approximately $36,000.

research and development expenses are related to the two-year collaboration agreement with University of Jaén, which was executed

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The overall decrease in research and development expenses is primarily related to our cost-cutting

measures due to lack of working capital funding.

Further research and development collaborations are currently under negotiation with

the University of Jaén and other contract research organizations in preparation for upcoming available working capital for future

research and development expenses.

expense increased to $305,649 for the three months ended September 30, 2025, as compared to $86,230 for the three months ended September

Interest expense is primarily comprised of approximately $151,000 of debt discount amortization, accretion of put premium of

approximately $37,000, default and prepayment penalty fees of approximately $53,000 and interest expense from accrual of interest expense

and other financing fees for a total of approximately $65,000 for the for the three months ended September 30, 2025.

increase in interest expense of approximately $219,000 is primarily attributable to the increase in amortization of debt discount of

approximately $94,000, increase in accretion of put premium of approximately $37,000, increase in default and prepayment penalty fees

of approximately $53,000 and increase of approximately $35,000 in interest expense from accrual of interest expense and other financing

expense decreased to $0 for the three months ended September 30, 2025 as compared to $27,182 for the three months ended September 30,

This decrease is primarily attributable to the decrease in issuance of convertible notes which initial value was bifurcated from

the embedded conversion option and was recorded as derivative expense.

measures due to insufficient working capital funding.

Further research and development collaborations are currently under negotiation

with the University of Jaén and other contract research organizations in preparation for upcoming available working capital for

future research and development expenses.

expense decreased to $58,955 for the three months ended December 31, 2025, as compared to $118,943 for the three months ended December

Interest expense increased to $364,604 for the six months ended December 31, 2025, as compared to $205,173 for the six months

ended December 31, 2024.

Interest expense is primarily comprised of approximately $187,000 of debt discount amortization, accretion of

put premium of approximately $37,000, default and prepayment penalty fees of approximately $53,000 and interest expense from accrual

of interest expense and other financing fees for a total of approximately $87,000 for the for the six months ended December 31, 2025.

decrease in interest expense during the three months ended December 31, 2025 of approximately $59,000 is primarily attributable to the

decrease in amortization of debt discount of approximately $41,000, and decrease of approximately $18,000 in interest expense from accrual

of interest expense and other financing fee.

increase in interest expense during the six months ended December 31, 2025 of approximately $159,000 is primarily attributable to the

increase in amortization of debt discount of approximately $53,000, increase in accretion of put premium of approximately $37,000, increase

in default and prepayment penalty fees of approximately $53,000 and increase of approximately $16,000 in interest expense from accrual

of interest expense and other financing fee.

expense decreased to $0 for the three months ended December 31, 2025 as compared to $8,559 for the three months ended December 31, 2024.

Derivative expense decreased to $0 for the six months ended December 31, 2025 as compared to $35,741 for the six months ended December

This decrease is primarily attributable to the decrease in issuance of convertible notes which initial value was bifurcated

from the embedded conversion option and was recorded as derivative expense.

in Fair Value of Derivative Liabilities

in fair value of derivative liabilities were increased to a loss of $19,706 for the three months ended September 30, 2025 as compared

to a gain of $52,787 for the three months ended September 30, 2024.

This increase in loss of approximately $72,000 is primarily attributable

to an increase in fair value of the principal amount of convertible notes with bifurcated embedded conversion option derivatives as a

result of the increase in stock prices during the three months ended September 30, 2025 as compared to the prior three month period.

in fair value of derivative liabilities increased to a gain of $87,728 for the three months ended December 31, 2025 as compared to $13,581

for the three months ended December 31, 2024.

Change in fair value of derivative liabilities was increased to a gain of $68,022 for the

six months ended December 31, 2025 as compared to $66,368 for the six months ended December 31, 2024.

The increase in gain for the three

and six months period of approximately $74,000 and $1,700,respectively, is primarily attributable to the decrease in fair value of the

principal amount of convertible notes with bifurcated embedded conversion option derivatives as a result of the decrease in number of

convertible notes which value was bifurcated from the embedded conversion option during the six months ended December 31, 2025 as compared

to the prior six month period.

in Fair Value of Warrant Liability

in fair value of warrant liability increased to a gain of $593,710 for the three and six months ended December 31, 2025 as compared to

$0 for both prior periods.

The increase in gain of approximately $594,000 is primarily attributable to the decrease in fair value of

the warrant liability as a result of the decrease in our stock price during the six months ended December 31, 2025.

(Loss) on Extinguishment of Debt, net

the three months ended September 30, 2025, notes with principal amounts totaling $69,650, accrued interest of $10,519 and conversion

fees of $1,406 containing bifurcated embedded conversion option derivatives were converted into common stock.

Accordingly, the fair market

value of the shares issued upon conversion was $178,884, resulting in a loss on extinguishment at the time of conversion of $97,309 and

$255,720 of derivative liability fair value was recorded as a gain on extinguishment at the time of conversion, resulting in a net gain

Additionally, following the repayment in full of principal balance of a certain convertible note dated in July 2025, $37,450

of the put premium was recorded into gain on extinguishment of debt during the three months ended September 30, 2025 which is included

in gain (loss) on extinguishment of debt in the accompanying condensed consolidated statements of operations.

the three months ended September 30, 2024, notes with principal amounts totaling $30,800, accrued interest of $2,212 and conversion fees

of $798 containing bifurcated embedded conversion option derivatives were converted into common stock.

Accordingly, the fair market value

of the shares issued upon conversion was $79,176, resulting in a loss on extinguishment at the time of conversion of $45,365 and $34,046

of derivative liability fair value was recorded as a gain on extinguishment at the time of conversion, resulting in a net loss of $11,319

which is included in gain (loss) on extinguishment of debt in the accompanying condensed consolidated statements of operations.

the six months ended December 31, 2025, were principal aggregate amount of convertible notes of $145,650, accrued interest of $14,960

and conversion fees of $2,343 containing bifurcated embedded conversion option derivatives were converted into common stock.

the fair market value of the shares issued upon conversion was $293,968, resulting in a loss on extinguishment at the time of conversion

of $131,015 and $303,743 of derivative liability fair value was recorded as a gain on extinguishment at the time of conversion, resulting

in a net gain of $172,728 which is included in gain (loss) on extinguishment of debt in the accompanying condensed consolidated statements

of operations.

the six months ended December 31, 2024, notes with principal amounts totaling $49,100, accrued interest of $3,769 and conversion fees

of $2,833 containing bifurcated embedded conversion option derivatives which were converted into common stock.

Accordingly, the fair

market value of the shares issued upon conversion was $137,454, resulting in a loss on extinguishment at the time of conversion of $81,752

and $51,674 of derivative liability fair value and was recorded as a gain on extinguishment at the time of conversion, resulting in a

net loss of $30,078 which is included in gain (loss) on extinguishment of debt in the accompanying condensed consolidated statements

of operations.

Currency Transaction Gain (Loss)

currency transaction gain (loss) increased to a loss of ($34,699) for the three months ended September 30, 2025 as compared to a gain

of $8,423 for the three months ended September 30, 2024.

This increase of approximately $43,000 is partially attributable to the increase

in exchange rates during the three months ended September 30, 2025.

loss increased to $4,837,738 for the three months ended September 30, 2025 as compared to a net loss of $354,310 for the three months

ended September 30, 2024.

currency transaction gain (loss) decreased to a loss of $19,497 for the three months ended December 31, 2025 as compared to $84,121 for

the three months ended December 31, 2024.

Foreign currency transaction gain (loss) decreased to a loss of $54,196 for the six months

ended December 31, 2025 as compared to $75,698 for the six months ended December 31, 2024.

This decreases is partially attributable to

the increase in exchange rates during the six months ended December 31, 2025.

loss increased to $3,091,394 for the three months ended December 31, 2025 as compared to a net loss of $430,183 for the three months

ended December 31, 2024.

Net loss increased to $7,929,132 for the six months ended December 31, 2025 as compared to a net loss of $784,493

for the six months ended December 31, 2024.

The change relates to the factors discussed above.

Company paid legal fees related to the sale of our Series C preferred stock of $50,000 and accreted $882,246 up to the redemption value

of the Series C Preferred stock.

Accordingly, the Company recognized total deemed dividend of $932,246 and $0 during the three and six

months ended December 31, 2025 and 2024, respectively, and a corresponding reduction of income available to common stockholders during

the three and six months ended December 31, 2025 and 2024.

loss available to common stockholders

loss available to common stockholders increased to $4,023,640 for the three months ended December 31, 2025 as compared to a net loss

available to common stockholders of $430,183 for the three months ended December 31, 2024.

Net loss available to common stockholders

increased to $8,861,378 for the six months ended December 31, 2025 as compared to a net loss available to common stockholders of $784,493

for the six months ended December 31, 2024.

The change relates to the factors discussed above.

and Capital Resources

Financial Condition

of September 30, 2025, we had total assets of $17,975,681, comprised primarily of cash of $602,737, GST tax receivable of $8,383, prepaid

expenses – current portion of $8,143,532, other current assets of $8,828, security deposit of $1,986, deferred offering cost of

$15,000, operating lease ROU asset, net of $56,279,prepaid expenses – long-term of $9,136,572 and fixed assets of $2,364.

to June 30, 2025, we had total assets of $19,631,808, comprised primarily of cash of $12,088, GST tax receivable of $5,302, prepaid expenses

– current portion of $8,334,046, other current assets of $1,380, security deposit of $1,971, deferred offering cost of $291,773,

operating lease ROU asset, net of $59,413 and prepaid expenses – long-term of $10,925,835.

had current liabilities of $3,454,964, primarily comprised of net convertible debt of $106,968, accounts payable, accrued expenses and

accrued interest of $2,064,705, employee benefit liability of $686,863, loans payable of $65,280, loans payable – related party

of $342,770, embedded conversion option liabilities of $167,878 and operating lease liability of $20,500 as of September 30, 2025.

compared to June 30, 2025, $5,578,240, primarily comprised of net convertible debt of $537,921, accounts payable and accrued expenses

of $2,926,941, employee benefit liability of $667,901, loans payable of $65,280, loans payable – related party of $415,329, note

payable, net of $543,312, embedded conversion option liabilities of $403,892 and operating lease liability of $17,664.

of December 31, 2025, we had total assets of $15,111,532, comprised primarily of cash of $561,237 GST tax receivable of $16,994, prepaid

expenses – current portion of $7,127,293, other current assets of $1,400, security deposit of $2,000, operating lease ROU asset,

net of $50,901, prepaid expenses – long-term of $7,347,310 and fixed assets of $4,397.

As compared to June 30, 2025, we had total

assets of $19,631,808, comprised primarily of cash of $12,088, GST tax receivable of $5,302, prepaid expenses – current portion

of $8,334,046, other current assets of $1,380, security deposit of $1,971, deferred offering cost of $291,773, operating lease ROU asset,

net of $59,413 and prepaid expenses – long-term of $10,925,835.

had current liabilities of $3,624,018, primarily comprised of net convertible debt of $55,000, accounts payable, accrued expenses

and accrued interest of $1,986,098, employee benefit liability of $703,190, loans payable of $65,280, loans payable – related

party of $472,083, embedded conversion option liabilities of $32,128, warrant liability of $288,635 and operating lease liability of

$21,604 as of December 31, 2025.

As compared to June 30, 2025, $5,578,240, primarily comprised of net convertible debt of $537,921,

accounts payable, accrued expenses and accrued interest of $2,926,941, employee benefit liability of $667,901, loans payable of

$65,280, loans payable – related party of $415,329, note payable, net of $543,312, embedded conversion option liabilities of

$403,892 and operating lease liability of $17,664.

have funded our operations primarily through the issuance of equity and/or convertible securities for cash.

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fees, and travel.

the three months ended September 30, 2025 we received proceeds from the sale of our common stock for approximately $3.3 million and proceeds

from issuance of notes of $175,000 and proceeds from issuance of loan payable from related parties of $78,249.

the six months ended December 31, 2025 we received proceeds from the sale of our common stock for approximately $3.3 million, sale of

our Series C preferred stock for approximately $950,000 and proceeds from issuance of notes of $175,000 and proceeds from issuance of

loan payable from related parties of $78,249.

have substantial capital resource requirements and have incurred significant losses since inception.

As of September 30, 2025, we had

As of December 31, 2025, we had

$561,237 in cash.

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and Uses of Cash

For the Three months ended

September 30,

the Six months ended

Net cash used in operating activities

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Cash Flow from Operating Activities

cash used in operating activities was $1,939,067 for the three months ended September 30, 2025, due to our net loss of $4,837,738 offset

cash used in operating activities was $2,938,207 for the six months ended December 31, 2025, due to our net loss of $7,929,132 offset

primarily non-cash charges of amortization of debt discount of $186,777, accretion of put premium of $37,450, non-cash interest expense

of $5,843, total stock-based expenses of $5,496,367, foreign currency transaction loss of $54,196, and change in fair value of derivatives

of $19,706 addback gain from extinguishment of debt of $195,862.

Net changes in operating assets and liabilities totaled $907,685, which

is primarily attributable to an increase in prepaid expenses of $362,329, decrease in accounts payable of $186,803, and decrease in accrued

expenses and other payables of $361,479.

cash used in operating activities was $235,515 for the three months ended September 30, 2024, due to our net loss of $354,310 offset

primarily by non-cash charges of amortization of debt discount of $56,983, non-cash interest expense of $2,548, derivative expense of

$27,182, foreign currency transaction gain of $8,423, addback change in fair value of derivatives of $52,787 and loss from extinguishment

of debt of $11,319.

Net changes in operating assets and liabilities totaled $68,939, which is primarily attributable to increase accrued

interest of $24,093 and increase in accrued expenses and other payables of $54,457.

of $68,022 and warrant liability of $593,710, addback gain from extinguishment of debt of $210,178.

Net changes in operating assets and

liabilities totaled $661,280, which is primarily attributable to an increase in prepaid expenses of $28,590, decrease in accounts payable

of $310,368, and decrease in accrued expenses and other payables of $351,663.

cash used in operating activities was $216,786 for the six months ended December 31, 2024, due to our net loss of $784,493 offset primarily

by non-cash charges of amortization of debt discount of $133,644, non-cash interest expense of $4,582, derivative expense of $35,741,

foreign currency transaction loss of $75,698, and gain from extinguishment of debt of $30,078 addback change in fair value of derivatives

Net changes in operating assets and liabilities totaled $329,466, which is primarily attributable to an increase in accrued

interest of $49,350, increase in accounts payable of $102,374 and increase in accrued expenses and other payables of $166,993.

Cash Flow from Investing Activities

cash used in investing activities was $2,491 for the three months ended September 30, 2025, related to purchase of equipment, as compared

to $0 for the three months ended September 30, 2024.

cash used in investing activities was $4,758 for the six months ended December 31, 2025, related to purchase of equipment, as compared

to $0 for the six months ended December 31, 2024.

Cash Flow from Financing Activities

cash provided by financing activities for the three months ended September 30, 2025 was $2,526,772.

During the three months ended September

30, 2025 we received net proceeds from sales of our common stock for $3,314,458, proceeds from issuance of notes of $175,000 and proceeds

from issuance of loan from related parties of $78,249 offset by repayment of notes of $875,127 and loans payable – related party

of $150,808, and deferred offering cost of $15,000.

cash provided by financing activities for the three months ended September 30, 2024 was $215,699.

During the three months ended September

30, 2024 we received net proceeds from issuance of convertible notes of $60,000 and proceeds from issuance of loan from related parties

cash provided by financing activities for the six months ended December 31, 2025 was $3,491,871.

During the six months ended December

31, 2025 we received net proceeds from sales of our common stock for $3,314,458 and Series C preferred stock for $950,099, proceeds from

issuance of notes of $175,000 and proceeds from issuance of loan from related parties of $78,249 offset by repayment of notes of $875,127

and loans payable – related party of $150,808.

cash provided by financing activities for the six months ended December 31, 2024 was $270,515.

During the six months ended December 31,

2024 we received net proceeds from issuance of convertible notes of $80,000, proceeds from a note of $35,000 and proceeds from issuance

of loan from related parties of $278,915 offset by repayment of notes of $98,400 and deferred offering cost of $25,000.

of Exchange Rate

effect of the exchange rate on cash resulted in a $5,435 positive adjustment to cash flows in the three months ended September 30, 2025

as compared to a $7,999 positive adjustment to cash flows in the three months ended September 30, 2024.

The reason for the fluctuation

is due to the application of currency translation rates throughout the cash flow statement, the volume of transactions within each period

effect of the exchange rate on cash resulted in a $243 positive adjustment to cash flows in the six months ended December 31, 2025 as

compared to a $60,181 negative adjustment to cash flows in the six months ended December 31, 2024.

The reason for the fluctuation is

due to the application of currency translation rates throughout the cash flow statement, the volume of transactions within each period

and the daily fluctuation in exchange rates.

25 unchanged sentences

Concern Qualification

did not generate any revenue for the three months ended September 30, 2025 and 2024 and have incurred significant losses and cash used

in operations, and such losses and use of cash are expected to continue.

did not generate any revenue for the six months ended December 31, 2025 and 2024 and have incurred significant losses and cash used in

operations, and such losses and use of cash are expected to continue.

Our independent registered public accounting firm has included

23 unchanged sentences

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