Notes to the Financial Statements

For the year ended 30 September 2025

 

1.    General information

 

capAI plc (the "Company") is a public limited company incorporated in England and Wales on 20 April 2011. During the year, on 4 February 2025, the Company changed its name from Dukemount Capital plc to capAI plc, reflecting the Group's strategic repositioning to focus on artificial intelligence-led opportunities.

 

The Company was admitted to the Official List of the Financial Conduct Authority and to trading on the Main Market of the London Stock Exchange on 29 March 2017. Following the UK Listing Reforms effective 29 July 2024, the Company has been mapped into the Equity Shares (Transition) category, under which it continues to comply with the applicable listing requirements.

 

The consolidated financial statements for the year ended 30 September 2025 comprise the Company and its subsidiaries (together referred to as the "Group").

 

The principal activity of the Group during the year was the identification, incubation and development of artificial intelligence-led businesses, technologies and intellectual property.

 

The Company's registered office is 9 Innovation Place, Douglas Drive, Godalming, Surrey, GU7 1JX.

 

The consolidated financial statements of the Group for the year ended 30 September 2025 were authorised for issue by the Board of Directors on 30 January 2026.

 

2.    Basis of preparation

 

2.1.    Statement of compliance

The consolidated financial statements of the Group and the parent company financial statements of the Company have been prepared in accordance with UK-adopted International Financial Reporting Standards ("UK-adopted IFRS") and with the requirements of the Companies Act 2006.

 

The consolidated financial statements comprise the financial statements of the Company and its subsidiaries as at 30 September 2025.

 

Exemption from preparation of Company statement of profit or loss

The Company has taken advantage of the exemption under section 408 of the Companies Act 2006 from presenting a Company statement of profit or loss and statement of comprehensive income. The loss for the Company for the year ended 30 September 2025 was £718,221 (2024: £21,231).

 

2.2.    Basis of measurement

The financial statements have been prepared on the historical cost basis, except for equity-settled share-based payment arrangements, which are measured at fair value at the grant date.

 

2.3.    Going concern

The financial statements have been prepared on a going concern basis, which assumes that the Group will continue in operational existence for a period of at least twelve months from the date of approval of these financial statements.

 

In assessing the going concern basis, the Directors have considered the Group's financial position, cash resources, forecast expenditure and anticipated funding requirements. The Group is at an early stage of development and while it expects to generate revenues as its AI platforms progress, the timing, scale and sustainability of future taxable profits remain uncertain at this stage. Accordingly, the Group may require additional funding to fully execute its strategy.

 

The requirement for further funding represents a material uncertainty which may cast significant doubt on the Group's ability to continue as a going concern. Notwithstanding this uncertainty, the Directors consider it appropriate to prepare the financial statements on a going concern basis, having regard to the Group's ability to manage expenditure, its track record of raising funds, and the Directors' expectations regarding future funding.

 

Further details regarding going concern are set out in the Directors' Report.

 

2.4.    Presentation currency

The financial statements are presented in pounds sterling (£), which is the functional and presentation currency of the Company. Amounts are rounded to the nearest pound, unless otherwise stated.

 

3.    Significant accounting policies

 

The accounting policies set out below have been applied consistently to all periods presented in these financial statements, unless otherwise stated.

 

3.1.    Basis of consolidation

Subsidiaries are entities controlled by the parent company. Control exists where the parent company is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity.

 

The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases. Intercompany balances, transactions, income and expenses are eliminated on consolidation.

 

3.2.    Changes in accounting policies and disclosures

New and amended standards applied in the year

There were no new standards or amendments that became effective for the first time for annual periods beginning on 1 October 2024. The Group has continued to apply the amendments effective from 1 January 2024 (including amendments to IAS 1, IFRS 16 and IAS 7/IFRS 7), which did not have a material impact on the Group.

 

Standards and interpretations issued but not yet effective

At the date of authorisation of these financial statements, the following standards and amendments had been issued by the IASB but were not yet effective for the year ended 30 September 2025 and have not been early adopted by the Group:

 

·    IFRS 18: Presentation and Disclosure in Financial Statements (effective for annual periods beginning on or after 1 January 2027)

·    IFRS 19: Subsidiaries Without Public Accountability: Disclosures (effective for annual periods beginning on or after 1 January 2027)

·    Amendments to IFRS 9 Financial Instruments and IFRS 7 Financial Instruments: Disclosures (effective for annual periods beginning on or after 1 January 2026)

·    Annual Improvements to IFRS Accounting Standards - Volume 11 (effective for annual periods beginning on or after 1 January 2026)

 

In addition, the International Sustainability Standards Board ("ISSB") has issued the following standards:

 

·    IFRS S1: General Requirements for Disclosure of Sustainability-related Financial Information

·    IFRS S2: Climate-related Disclosures

 

These sustainability standards are effective for annual periods beginning on or after 1 January 2024 but are not yet mandatory for UK-adopted IFRS reporters and have not been applied by the Group. The Directors will consider the applicability of these standards in due course, taking into account regulatory developments and the size and nature of the Group's operations.

 

3.3.    Foreign currency

Transactions denominated in foreign currencies are translated into the functional currency of the relevant entity at the exchange rates prevailing at the dates of the transactions.

 

Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rates prevailing at the reporting date. Exchange differences arising on settlement or translation are recognised in profit or loss.

 

The assets and liabilities of foreign operations are translated into sterling at the exchange rates prevailing at the reporting date, and income and expenses are translated at average exchange rates for the period. Exchange differences arising on consolidation are recognised in other comprehensive income and accumulated in the foreign currency translation reserve.

 

3.4.    Share-based payments

Equity-settled share-based payment arrangements are accounted for in accordance with IFRS 2 Share-Based Payment. The fair value of equity instruments granted is determined at the grant date and recognised as an expense over the vesting period or estimated service period, with a corresponding increase in equity.

 

The fair value of share options and warrants issued in exchange for services is measured using an appropriate valuation model, taking into account the terms and conditions of the grant.

 

Further details of share-based payment arrangements are set out in note 17.

 

3.5.    Financial instruments

Financial assets and liabilities are recognised when the Group becomes a party to the contractual provisions of the instrument.

 

Financial assets are classified and measured at amortised cost where they are held within a business model whose objective is to hold assets to collect contractual cash flows and where those cash flows represent solely payments of principal and interest.

 

Trade and other payables are initially recognised at fair value and subsequently measured at amortised cost.

 

3.6.    Cash and cash equivalents

Cash and cash equivalents comprise cash at bank and short-term deposits with an original maturity of three months or less, which are readily convertible to known amounts of cash and subject to an insignificant risk of changes in value.

 

Cash and cash equivalents are carried in the statement of financial position at amortised cost.

 

3.7.    Taxation

Current tax is based on taxable profit for the year and is calculated using tax rates enacted or substantively enacted at the reporting date.

 

Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities and the corresponding tax bases, to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilised.

 

Deferred tax assets are not recognised where the Directors consider that it is not probable that sufficient taxable profits will be available.

 

3.8.    Earnings or loss per share

Basic earnings or loss per share is calculated by dividing the profit or loss attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the year.

 

Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares in issue to assume conversion of all dilutive potential ordinary shares.

 

Potential ordinary shares are treated as dilutive only when their conversion would decrease earnings per share or increase loss per share. In periods where the Group reports a loss, potential ordinary shares are anti-dilutive and are therefore excluded from the calculation of diluted loss per share.

 

4.    Critical accounting judgements and key sources of estimation uncertainty

The preparation of the financial statements requires the Directors to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

 

The areas involving the most significant judgement and estimation uncertainty are set out below.

 

4.1.    Share-based payments

The valuation of equity-settled share-based payment arrangements requires the use of judgement and estimates, including assumptions relating to expected volatility, expected life, risk-free interest rates and the assessment of vesting conditions.

 

Judgement is also required in determining the accounting treatment of modifications to awards, anti-dilution provisions and good-leaver arrangements.

 

Further details are set out in note 17.

 

4.2.    Going concern

The Directors' assessment of the Group's ability to continue as a going concern involves judgement, particularly in relation to future funding, expenditure commitments and the timing of potential cash inflows.

 

5.    Subsidiaries

 

The following subsidiaries were held by the Group during the year ended 30 September 2025:

 

Entity name	Country of incorporation	Date of incorporation	Registered office	Principal activity	Ownership
capMedia, Inc	United States of America	7 July 2025	16192 Coastal Highway Lewes, Delaware 19958 USA	Development and commercialisation of AI-enabled platforms, primarily in media-related applications	100%
capMedia (UK) Ltd	United Kingdom	11 March 2016	9 Innovation Place, Douglas Drive, Godalming, Surrey, England, GU7 1JX	Dormant	100%
capMedical (UK) Ltd	United Kingdom	12 June 2019	9 Innovation Place, Douglas Drive, Godalming, Surrey, England, GU7 1JX	Dormant	100%

 

During the year, capMedia (UK) Ltd underwent changes of name to reflect the Group's strategic repositioning, transitioning from Dukemount Limited to capai opportunities ltd, and subsequently on 19 September 2025 to capMedia (UK) Ltd. capMedical (UK) Ltd also underwent a change of name, changing from DKE Care and Leisure Ltd to capMedical (UK) Ltd on 19 September 2025, to align with the Group's strategic repositioning and branding.

 

All subsidiaries are consolidated in the Group financial statements. Intercompany balances, transactions, income and expenses are eliminated on consolidation.

 

The £74 investment in subsidiaries recognised in the Company's statement of financial position represents the sterling equivalent of US$100 of common stock subscribed on the incorporation of capMedia, Inc. The amount has been translated at the exchange rate prevailing on the date of incorporation.

 

On 3 October 2025, subsequent to the year end, the Group incorporated capMedical, Inc in the United States as a wholly owned subsidiary. capMedical, Inc was established to support the Group's activities in medical and healthcare-related artificial intelligence, including the application of advanced AI technologies within medicine and longevity-focused initiatives.

 

All subsidiaries are consolidated in the Group financial statements. Intercompany balances, transactions, income and expenses are eliminated on consolidation.

 

In the Company financial statements, investments in subsidiaries are stated at cost less impairment, in accordance with IAS 27 Separate Financial Statements.

 

6.    Revenue

 

The Group did not generate revenue during the year ended 30 September 2025 (2024: £nil). This reflects the Group's early-stage operating model as it repositioned towards identification, incubation and development of AI-related initiatives, including products and platforms in media, medicine and longevity.

 

The Group commenced trading activities, and entered into Licence and Option Agreements for the development of AI platforms during the year, including Author42, Creator42 and Game42 through its subsidiary capMedia, Inc.

 

The Directors expect these arrangements to generate revenues in future periods as commercial deployment of these platforms progresses.

 

7.    Administrative expenses

 

Administrative expenses for the year comprise the following:

 

	Year ended 30 September 2025 £	Year ended 30 September 2024 £
Professional and advisory fees	465,895	158,331
Listing and regulatory costs	72,586	68,535
Directors' fees and remuneration	33,333	-
Share-based payment expense	189,646	-
Other administrative costs	29,972	-
Total administrative expenses	791,432	226,866

 

Administrative expenses primarily relate to the costs of maintaining the Company's public listing, professional advisory services, governance costs and share-based payment charges recognised in accordance with IFRS 2.

 

Write-back of loans and debts (prior year)

In the prior year the Group wrote back debts of £340,946 comprised as follows:

 

During the year ended 30 September 2024, the Company recognised income of £248,197 arising from the write-back of historical loan and creditor balances. Following a review of these balances, the Directors concluded that they no longer represented present obligations of the Group and were therefore derecognised in accordance with IFRS.

 

As at 30 September 2023 the Group owed £81,091 to Metro Bank in respect of Bounce Back Loans via two former subsidiaries, DKE (North West)  Ltd and DKE (Wavertree) Ltd. As liquidators were appointed for these subsidiaries on 12 July 2024, the subsidiaries were deconsolidated from the Group's accounts as of the same date.  The balances of £81,091 were written-back to the Group's profit and loss account together with other debts no longer due of £11,658.

 

The write-back was presented as a separate line item within the consolidated statement of comprehensive income and contributed to the profit for the year ended 30 September 2024.

 

8.    Discontinued operations

 

Results of discontinued operations

The profit from discontinued operations recognised in the consolidated statement of comprehensive income for the year ended 30 September 2024 was as follows:

 

	£
Profit from discontinued operations	91,380

 

The discontinued operations relate to legacy property activities that were disposed of in prior periods.

 

There were no discontinued operations during the year ended 30 September 2025, and no assets, liabilities, income or expenses relating to discontinued operations were recognised in the current year.

 

The Group has no continuing involvement in the disposed operations.

 

9.    Auditors' remuneration

 

Fees payable to the Group's auditor for services rendered during the year were as follows:

 

	Year ended 30 September 2025 £	Year ended 30 September 2024 £
Audit of the Group and Company financial statements	26,000	24,000
Non-audit services	-	-
Total auditors' remuneration	26,000	24,000

 

10.  Finance income and costs

 

	Year ended 30 September 2025 £	Year ended 30 September 2024 £
Finance income	903	-
Finance costs	(1,013)	-
Net finance (cost)/income	(110)	-

 

The Group did not incur any material finance income or finance costs during the year other than minor interest items as disclosed above. Finance costs of £1,013 (2024: £nil) primarily relate to incidental bank charges and interest.

 

11.  Taxation

 

11.1.  Analysis of tax charge

	Year ended 30 September 2025 £	Year ended 30 September 2024 £
Current tax	-	-
Deferred tax	-	-
Total tax charge	-	-

 

11.2.  Reconciliation of loss before tax to tax charge

	Year ended 30 September 2025 £	Year ended 30 September 2024 £
(Loss)/profit before taxation	(790,529)	112,712
Tax at UK corporation tax rate of 25% (2024: 25%)	(197,632)	28,178
Expenses not deductible for tax purposes	58,955	20,723
Other timing differences	49,569	-
Unutilised/(utilised) tax losses	89,108	(48,901)
Total tax charge	-	-

 

11.3.  Deferred tax

The Group has accumulated tax losses available for potential offset against future taxable profits. As at 30 September 2025, UK and US tax losses available to be carried forward are estimated at £3,527,232 (2024: £3,244,070) and £8,296 (2024: £Nil) respectively.

 

While the Group has entered into initial revenue-generating arrangements and expects revenues to emerge as its AI platforms continue to progress, the timing, scale and sustainability of future taxable profits remain uncertain at this stage. In addition, the UK tax losses have arisen in the Company, and their future utilisation is dependent not only on agreement by HMRC as to the availability of such losses, but also on the Company generating sufficient future taxable profits, for example through the receipt of management charges or other taxable income. The utilisation of US tax losses is similarly dependent on the generation of future taxable profits within the relevant US entity and subject to applicable US tax rules.

 

Accordingly, the Directors consider it prudent not to recognise a deferred tax asset in respect of these losses at the reporting date. The position will be kept under review as the Group's activities continue to develop and greater certainty over future taxable profits emerges.

 

UK tax losses carried forward do not expire. The availability and utilisation of US tax losses are subject to US tax legislation.

 

12.  Earnings or loss per share

 

Basic earnings or loss per share is calculated by dividing the profit or loss attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the year.

 

Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares in issue to assume conversion of all dilutive potential ordinary shares.

 

Potential ordinary shares are treated as dilutive only when their conversion would decrease earnings per share or increase loss per share. In periods where the Group reports a loss, potential ordinary shares are anti-dilutive and are therefore excluded from the calculation of diluted loss per share.

 

Where the Group has discontinued operations, earnings per share is presented for both continuing operations and total profit attributable to equity holders, in accordance with IAS 33 Earnings per Share. Earnings per share for the comparative period includes the effect of discontinued operations, as described in note 8.

 

12.1.  (Loss) / earnings attributable to equity holders

	Year ended 30 September 2025 £	Year ended 30 September 2024 £
(Loss) / profit from continuing operations	(790,529)	21,332
Profit from discontinued operations	-	91,380
(Loss) / profit for the year attributable to equity holders	(790,529)	112,712

 

The profit for the year ended 30 September 2024 includes profit from discontinued operations of £91,380, as disclosed in note 8.

 

12.2.  Weighted average number of ordinary shares

	Year ended 30 September 2025 £	Year ended 30 September 2024 £
Weighted average number of ordinary shares - basic	2,754,776,434	923,868,784
Effect of dilutive share options and warrants	-	-
Weighted average number of ordinary shares - diluted	2,754,776,434	923,868,784

 

For the year ended 30 September 2025, the Group reported a loss and therefore all potential ordinary shares were anti-dilutive. Accordingly, diluted loss per share is the same as basic loss per share.

 

12.3.  Loss / earnings per share

	Year ended 30 September 2025	Year ended 30 September 2024
Basic (loss) / earnings per share - continuing operations (pence)	(0.0287)	0.0023
Basic (loss) / earnings per share - total (pence)	(0.0287)	0.0122
Diluted (loss) / earnings per share (pence)	(0.0287)	0.0122

 

For the year ended 30 September 2024, diluted earnings per share has been presented as the Group reported a profit for the period.

 

12.4.  Potentially dilutive instruments

At 30 September 2025, the Company had outstanding share options and warrants which could potentially dilute earnings per share in future periods. These instruments are described in further detail in notes 16, 17 and 18.

 

13.  Cash and cash equivalents

 

Unless otherwise stated, the disclosures in this note relate to the consolidated Group.

 

Cash and cash equivalents comprise cash at bank and short-term deposits with an original maturity of three months or less.

 

13.1.  Analysis of cash and cash equivalents

 

	Group 30 September 2025 £	Company 30 September 2025 £	Group 30 September 2024 £	Company 30 September 2024 £
Cash at bank	96,444	71,200	28,329	28,329
Total cash and cash equivalents	96,444	71,200	28,329	28,329

 

13.2.  Reconciliation to the statement of cash flows

The amounts disclosed above reconcile to the cash and cash equivalents balances shown in the Consolidated Statement of Cash Flows.

 

14.  Trade and other receivables

 

Unless otherwise stated, the disclosures in this note relate to the consolidated Group.

 

14.1.  Analysis of trade and other receivables

 

	Group 30 September 2025 £	Company 30 September 2025 £	Group 30 September 2024 £	Company 30 September 2024 £
Trade receivables	-	-	-	-
Prepayments and accrued income	31,601	95,326	21,744	21,744
Other receivables	53,651	53,651	9,278	9,278
Amounts due from Group undertakings	-	24,840	-	-
Total trade and other receivables	85,252	173,817	31,022	31,022

 

The Group had no trade receivables at the reporting date (2024: nil).

 

Prepayments principally comprise amounts paid in advance in respect of directors' and officers' insurance and regulatory fees. Other receivables primarily comprise value added tax recoverable, which the Directors expect to be recovered within twelve months of the reporting date.

 

Included within other receivables in the Company balance sheet at 30 September 2025 is an accrued amount of £63,725 (2024: £nil) due from capMedia, Inc, a wholly owned subsidiary, in respect of management charges for the period for which invoices were issued subsequent to the year end. This intercompany balance is unsecured, interest free and repayable on demand and is eliminated on consolidation. Accordingly, it does not form part of trade and other receivables in the consolidated financial statements.

 

14.2.  Credit risk and expected credit losses

Trade and other receivables are held at amortised cost. Due to the short-term nature of the receivables and the limited exposure to credit risk, the Directors consider that the carrying amounts approximate their fair value.

 

The Group applies the simplified approach to measuring expected credit losses under IFRS 9. No impairment provision has been recognised at 30 September 2025, as the Directors consider the risk of default to be immaterial (2024: nil).

 

15.  Trade and other payables

 

Unless otherwise stated, the disclosures in this note relate to the consolidated Group.

 

15.1.  Analysis of trade and other payables

 

	Group 30 September 2025 £	Company 30 September 2025 £	Group 30 September 2024 £	Company 30 September 2024 £
Trade payables	33,497	33,497	88,516	88,516
Accruals and deferred income	148,280	148,280	42,100	42,100
Other payables	9,701	788	-	-
Total trade and other payables	191,478	182,565	130,616	130,616

 

Accruals principally comprise professional fees, including legal and advisory costs incurred in connection with governance matters, regulatory compliance, licensing arrangements and strategic initiatives undertaken during the year.

 

Trade and other payables disclosed above relate to the consolidated Group. Intercompany balances arising between the Company and its subsidiaries are eliminated on consolidation and are therefore not included in the Group trade and other payables balance. Intercompany payables arising in subsidiary entities are reflected in the individual entity financial statements only.

 

15.2.  Financial liabilities and maturity

Trade and other payables are non-interest bearing and are generally settled within normal credit terms of between 30 and 90 days. Due to their short-term nature, the Directors consider that the carrying amounts of trade and other payables approximate their fair value.

 

All trade and other payables are classified as current liabilities.

 

16.  Share capital and reserves

 

Unless otherwise stated, the disclosures in this note relate to both the Group and the Company. Differences between the Group and Company positions are explained where relevant.

 

16.1.  Share capital

Issued share capital as at 30 September 2025

Group and Company Class of share	Number	Nominal value (£)
Ordinary shares	3,733,930,636	0.00001
Deferred shares	61,624,316	0.00900
Deferred B shares	969,316,623	0.00099
Total issued share capital	4,764,871,575	0.00033

 

The issued share capital disclosed above reflects the position at 30 September 2025 and is stated prior to the share consolidation completed on 6 October 2025.

 

Ordinary shares carry voting rights, rights to dividends and rights to participate in surplus assets on a winding up.

 

Deferred shares carry no voting rights, no rights to dividends, and no rights to surplus assets beyond repayment of nominal value. Accordingly, deferred shares are excluded from earnings per share calculations and are not considered part of the Company's economic equity.

 

16.2.  Movements in ordinary share capital

The opening issued share capital at 1 October 2024 reflects a capital reorganisation completed during the year ended 30 September 2024, which resulted in the creation of deferred share classes. Further details of this reorganisation are set out in the Company's annual report and financial statements for the year ended 30 September 2024 and in the interim financial statements for the six-month period ended 31 March 2025.

 

Group and Company	Number of ordinary shares	Share capital ordinary (£)	Share capital deferred (£)	Share premium   (£)
At 1 October 2024	1,719,316,623	17,193	1,514,242	2,034,113
Shares issued (admitted on 24 October 2024)	394,000,000	3,940	-	94,560
Shares issued (admitted on 7 April 2025)	687,500,000	6,875	-	268,125
Shares issued - conversion of loan notes (admitted on 7 April 2025)	83,000,000	830	-	19,920
Shares issued - settlement of fees (admitted on 7 April 2025)	50,793,650	508	-	15,492
Shares issued - conversion of loan notes (admitted on 11 April 2025)	123,000,000	1,230	-	29,520
Shares issued - settlement of fees (admitted on 11 April 2025)	63,492,063	635	-	19,365
Shares issued - warrant exercise (admitted on 24 April 2025)	110,728,300	1,107	-	40,416
Shares issued - warrant exercise (admitted on 9 June 2025)	400,000,000	4,000	-	146,000
Shares issued - warrant exercise (admitted on 9 September 2025)	102,100,000	1,021	-	69,142
Share issue costs	-	-	-	(60,320)
Total issued in the period	2,014,614,013	20,146	-	642,220
At 30 September 2025	3,733,930,636	37,339	1,514,242	2,676,333

 

Share issues during the year

During the year ended 30 September 2025, the Company undertook a number of equity transactions to strengthen its balance sheet, fund operations and support its strategic repositioning.

 

On 17 October 2024, the Company raised £150,000 by way of a placing of 394,000,000 ordinary shares of £0.00001 each at a price of £0.00025 per share, raising gross proceeds of £98,500, together with the issue of £51,500 of convertible loan notes ("CLNs").

 

The CLNs were convertible at £0.00025 per share into new ordinary shares. All CLNs were converted in full, resulting in the issue of 206,000,000 ordinary shares, which were admitted to trading on 7 April 2025 and 11 April 2025.

 

In addition, on 7 April 2025, the Company completed a further equity fundraising pursuant to shareholder approval, issuing 687,500,000 ordinary shares at a price of £0.0004 per share, raising gross proceeds of £275,000.

 

During April 2025, the Company also issued ordinary shares in settlement of professional fees and other liabilities in non-cash transactions, with such shares measured at a fair value of £36,000 at the date of admission, in accordance with IFRS. This transaction was non-cash in nature and is therefore excluded from proceeds from the issue of shares in the statement of cash flows

 

During the year, the Company issued ordinary shares following the exercise of warrants, resulting in the issue of 612,828,300 ordinary shares, with admissions occurring on 24 April 2025, 9 June 2025 and 9 September 2025. Proceeds received from warrant exercises were credited to share capital and share premium as appropriate.

 

The net cash proceeds of £574,866 disclosed in the statement of cash flows reconcile to the proceeds from the issue of shares in October 2024 and April 2025, and the warrant exercises noted above, less share issue costs. Share issue costs of £60,320 incurred in connection with the above equity transactions have been deducted from share premium in accordance with IAS 32 Financial Instruments: Presentation.

 

16.3.  Deferred shares

Both classes of deferred Shares have no voting rights, no entitlement to attend General Meetings of the Company, no right to any dividend or other distribution and will carry only the right to participate in any return of capital to the extent of the amount paid up or credited as paid up on each deferred Share after the holders of existing ordinary shares have received, not only the aggregate amount paid up on those shares, but also £1 million per new ordinary share.

 

As at 31 March 2025, there were two classes of deferred shares in issue:

 

•             61,624,316 deferred shares of £0.009 each, and

•             969,316,623 deferred B shares of £0.00099 each,

 

totalling 1,030,940,939 deferred shares with an aggregate nominal value of £1,514,242.

 

There were no movements in deferred shares during the year. Deferred shares in issue at 30 September 2025 were unchanged from the prior period.

 

16.4.  Share consolidation (post year-end)

On 6 October 2025, subsequent to the year end, the Company implemented a 10:1 share consolidation, whereby every ten existing ordinary shares were consolidated into one ordinary share.

 

At the same general meeting, shareholders approved the adoption of new articles of association. The new articles were adopted to reflect the share consolidation and to update the Company's capital structure provisions.

 

The share capital disclosures above reflect the position at 30 September 2025, prior to the share consolidation. Comparative per-share information has not been restated.

 

16.5.  Share premium

The share premium account represents the excess of proceeds received over the nominal value of ordinary shares issued, net of share issue costs.

 

16.6.  Share-based payment reserve

The share-based payment reserve represents the cumulative charge recognised in respect of equity-settled share-based payment arrangements in accordance with IFRS 2 Share-Based Payment. Further details are set out in note 17.

 

16.7.  Retained earnings

Retained earnings represent the accumulated losses of the Group since incorporation, including the loss for the year.

 

16.8.  Nature and purpose of reserves

Reserve	Description
Share capital	Nominal value of issued shares
Share premium	Proceeds in excess of nominal value, net of issue costs
Share-based payment reserve	IFRS 2 equity-settled charges
Retained earnings	Accumulated profits and losses

 

17.  Share-based payments

 

17.1.  Options and conditional awards accounted for under IFRS 2

The Group operates equity-settled share-based payment arrangements for Directors and certain advisers, which are accounted for in accordance with IFRS 2 Share-Based Payment.

 

The fair value of equity instruments granted is measured at the grant date using an appropriate valuation model and is expensed over the vesting period or estimated service period, with a corresponding credit recognised in equity within the share-based payment reserve. Vesting conditions relating to service or market-based performance are taken into account in determining the grant-date fair value.

 

Equity instruments issued in connection with fundraising activities, including warrants issued to subscribers, are considered to form part of the related financing arrangements and are therefore outside the scope of IFRS 2. There is additional detail in note 17.7.

 

17.2.  Equity instruments in issue

During the year, the Company granted share options to Directors and issued warrants in connection with fundraising activities and for services provided.

 

17.3.  Share options and conditional awards outstanding

Group and Company	Number of options and conditional awards
Outstanding at 1 October 2024	-
Granted during the year	2,375,000,000
Exercised / lapsed during the year	-
Outstanding at 30 September 2025	2,375,000,000

 

The options and conditional awards outstanding at 30 September 2025 relate to grants made on 29 January 2025 and 12 March 2025.

 

17.4.  Details of option and conditional awards grants

 

17.4.1.   Options and conditional awards granted on 29 January 2025

Share price hurdle £	Vesting condition	Richard Edwards	Sarah Davy	Total
0.0005	Continuous service	160,000,000	40,000,000	200,000,000
0.0010	6 months' service	120,000,000	30,000,000	150,000,000
0.0015	12 months' service	120,000,000	30,000,000	150,000,000
Total		400,000,000	100,000,000	500,000,000

 

The options and conditional awards were granted with an exercise price of £0.000315 per share, being the closing mid-market price on the trading day immediately preceding the grant date.

 

17.4.2.   Options and conditional awards granted on 12 March 2025

Share price hurdle £	Vesting condition	Richard Edwards	Professor Ronjon Nag	Total
0.0005	Continuous service	125,000,000	500,000,000	625,000,000
0.0013	6 months' service	125,000,000	500,000,000	625,000,000
0.0030	12 months' service	125,000,000	500,000,000	625,000,000
Total		375,000,000	1,500,000,000	1,875,000,000

 

The options and conditional awards were granted with an exercise price of £0.00001 per share, being the nominal value of the Company's ordinary shares at the grant date.

 

17.5.  Anti-dilution provisions

The options and conditional awards granted on 12 March 2025 include anti-dilution provisions designed to maintain the relative ownership interests of the relevant Directors in the event that warrants outstanding at the time of grant are subsequently exercised.

 

Under these provisions, additional share options and conditional awards may be granted on substantially the same terms as the original awards where dilution arises as a result of such warrant exercises. The anti-dilution mechanism does not apply to warrants issued after the relevant grant dates.

 

These arrangements were disclosed at the time of grant and approved by shareholders. Any additional options issued pursuant to these provisions are accounted for in accordance with IFRS 2 and treated as modifications to the original awards, where applicable.

 

17.6.  Warrants

The Company has issued warrants during the year both:

 

·    in connection with equity fundraising activities; and

·    in limited cases, in consideration for professional and advisory services.

 

Warrants issued in connection with equity fundraising activities are treated as equity instruments and fall outside the scope of IFRS 2.

 

Warrants issued in consideration for services rendered are accounted for as equity-settled share-based payment arrangements under IFRS 2 and are included within the share-based payment expense recognised for the year.

 

Further details of warrants outstanding at the year end, including movements during the year and key terms, are set out in note 18.

 

17.7.  Warrants accounted for under IFRS 2

During the year, the Company issued and modified certain warrants in consideration for professional and advisory services. These warrants were assessed as equity-settled share-based payment arrangements in accordance with IFRS 2 Share-based Payment.

 

Warrants issued solely in connection with equity fundraisings are treated as equity instruments and fall outside the scope of IFRS 2. Such warrants are disclosed separately in note 18.

 

Modification of warrants

On 17 October 2024, in connection with a fundraising undertaken during the period, the Company modified the terms of all warrants previously issued, including those for services, by repricing them to an exercise price of £0.000375 per share.

 

In accordance with IFRS 2, the modification was accounted for by measuring the incremental fair value arising from the change in terms at the date of modification. The fair value of the original awards immediately prior to modification was included in the calculation but was immaterial in amount. Accordingly, for clarity of presentation, only the valuation assumptions applied to the revised terms are disclosed.

 

17.8.  Fair value measurement and valuation assumptions

The fair value of share options and warrants granted during the year was determined using the Black-Scholes option pricing model.

 

The model incorporates the following inputs:

 

·    market price of the Company's shares at the grant date;

·    exercise price of the option or warrant;

·    expected share price volatility;

·    expected life of the option or warrant;

·    risk-free interest rate; and

·    expected dividend yield (assumed to be nil).

 

Share options and conditional awards

The valuation assumptions applied to share options granted during the year are set out below:

 

Group and Company	Options and conditional awards granted 29 January 2025	Options and conditional awards granted 12 March 2025
Expected life (years)	3	3
Risk-free rate	4.75%	4.50%
Expected volatility	20.00%	20.00%
Dividend yield	Nil	Nil
Share price at grant	£0.000315	£0.000375
Exercise price	£0.000315	£0.000010

 

The share options and conditional awards granted expire on the 10^th anniversary of the grant date. For valuation purposes, an expected life of three years has been applied, consistent with market practice for UK small-cap listed entities.

 

Warrants issued or modified for services

During the year, the Company issued and modified certain warrants in consideration for professional and advisory services. These warrants were assessed as equity-settled share-based payment arrangements under IFRS 2.

 

Where warrants were modified, the incremental fair value arising from the change in terms was measured at the modification date. The fair value of the original terms immediately prior to modification was assessed as immaterial and, for clarity of presentation, the valuation assumptions for the original terms are not presented separately.

 

For clarity of presentation, the fair value arising from warrant modifications and new warrant issuances during the year has been presented on an aggregated basis. The underlying valuation assumptions applied to each event are disclosed below.

 

The valuation assumptions applied to warrants issued or modified for services during the year are set out below:

 

Group and Company	Warrants modified 17 October 2024	Warrants granted 24 October 2024	Warrants granted 7 April 2025
Expected life (years)	2.4	2.4	1.9
Risk-free rate	5.00%	5.00%	4.50%
Expected volatility	20.00%	20.00%	185.73%
Dividend yield	Nil	Nil	Nil
Share price at grant	£0.000335	£0.000310	£0.002700
Exercise price	£0.000375	£0.000375	£0.000375

 

The expected volatility applied to warrants granted on 7 April 2025 reflects the increased share price volatility observed during the period immediately preceding the grant date.

 

17.9.  Share-based payment expense

The total share-based payment expense recognised for the year ended 30 September 2025 was £189,646 (2024: £nil), comprising charges in respect of share options, conditional awards and warrants issued or modified for services.

 

The warrant-related charge recognised during the year principally relates to warrants issued in April 2025, which had a material fair value at grant date due to the prevailing market price of the Company's shares. The incremental fair value arising from the repricing of existing warrants in October 2024 was not material in isolation.

 

The following table reconciles the total expense recognised during the year:

 

Group and Company	Fair value £	Charge recognised £
Options granted on 29 January 2025	32,343	7,236
Options and conditional awards granted on 12 March 2025	686,743	127,314
Warrants issued or modified for services	55,097	55,096
Total	774,183	189,646

 

The share-based payment charge has been recognised within administrative expenses in the consolidated statement of comprehensive income, with a corresponding credit to the share-based payment reserve.

 

The remaining fair value of equity-settled awards will be recognised over the remaining vesting or service periods in accordance with IFRS 2.

 

17.10.    Post-year-end matters

Subsequent to the year end, on 6 October 2025, the Company implemented a 10:1 share consolidation, whereby every ten existing ordinary shares were consolidated into one ordinary share. Further details of the share consolidation are set out in note 15.

 

As a consequence of the share consolidation, the number of options and conditional awards outstanding and their exercise prices were adjusted in accordance with the terms of the relevant option awards. These adjustments were mechanical in nature and did not result in any modification to the fair value of the awards for the purposes of IFRS 2 Share-based Payment.

 

Following the year end, there were a number of developments relating to share-based payment arrangements arising from changes in Board composition. These events occurred after the reporting date and are therefore treated as non-adjusting subsequent events.

 

On 17 December 2025, Jack Allardyce was appointed as an Executive Director of the Company, replacing Richard Edwards, who stepped down from the Board. In connection with his appointment, the Company granted options over ordinary shares to Mr Allardyce to align his interests with the Company's strategic objectives. The grants comprised:

 

·    4,000,000 options with an exercise price of £0.00315 per share; and

·    4,166,667 options with an exercise price of £0.0001 per share,

 

with each award vesting on 12 March 2026. The exercise prices reflect the adjustments to existing share options and conditional awards associated with the October 2025 share consolidation.

 

On the same date, the treatment of Richard Edwards' existing option awards under the capAI plc Long Term Incentive Plan was confirmed. He was treated as a good leaver and the following was agreed by the remuneration committee:

 

·    Retainment of the vested portion of his share options (28,000,000 share options at exercise price of £0.00315 and 25,000,000 share options at exercise price of £0.0001);

·    accelerated vesting of two-thirds of the third tranche of both his January 2025 and March 2025 share option awards (8,000,000 share options at exercise price of £0.00315 and 8,333,333 share options at exercise price of £0.0001); and

·    cancellation of the remaining one-third of the third tranche of those share option awards (4,000,000 share options at exercise price of £0.00315 and 4,166,667 share options at exercise price of £0.0001).

 

The anti-dilution protection provisions attached to the March 2025 option award were removed from the retained portion of the third tranche. All retained options remain subject to their original terms, including exercise periods and any applicable holding restrictions.

 

No other material modifications to share-based payment arrangements occurred after the reporting period.

 

18.  Warrants

 

18.1.  Accounting policy

Warrants issued in connection with equity fundraising transactions are treated as equity instruments and fall outside the scope of IFRS 2 Share-based Payment. Warrants issued in consideration for services rendered are assessed under IFRS 2 and, where material, accounted for as equity-settled share-based payments.

 

All warrants are classified as equity and are not subsequently remeasured.

 

18.2.  Movement in warrants

Group and Company	Number of warrants
Outstanding at 1 October 2024	801,579,499
Warrants issued pursuant to placings and fundraisings	1,287,500,000
Warrants issued for services	38,625,000
Warrants exercised during the year	(612,828,300)
Outstanding at 30 September 2025	1,514,876,199

 

The warrants issued pursuant to placings and fundraisings comprise warrants issued in connection with the October 2024 fundraising and the conditional fundraising announced in March 2025. Warrants issued for services relate to advisory and professional services provided to the Company during the period.

 

Numbers shown are prior to the 10:1 share consolidation completed after the year end.

 

18.3.  Warrants outstanding at the year end

At 30 September 2025, the principal warrants outstanding were as follows:

 

Expiry date	Exercise price £	Number of warrants
March 2027	0.000375	90,204,499
May 2027	0.000375	422,171,700
October 2027	0.000375	390,000,000
April 2026	0.000800	612,500,000
Total		1,514,876,199

 

The expiry dates shown above are stated by month and year; the warrants expire on the corresponding anniversary dates of issue in each case.

 

18.4.  Repricing of warrants

On 17 October 2024, in connection with the October 2024 fundraising, the Company repriced all warrants outstanding at that time to an exercise price of £0.000375 per share, in order to ensure consistency across warrant instruments and to increase the likelihood of exercise based on the prevailing market price.

 

The repricing constituted a modification of equity-settled instruments under IFRS 2. The incremental fair value arising from the modification was determined using the Black-Scholes option pricing model and was not material in isolation. The resulting charge has been recognised within administrative expenses and forms part of the total share-based payment expense disclosed in note 17.

 

18.5.  Warrants issued for services

During the year, the Company issued warrants in consideration for professional and advisory services.

 

Such warrants were assessed under IFRS 2 Share-based Payment. Details of the fair value recognised and the accounting treatment applied are disclosed in note 17.

 

18.6.  Share consolidation (post year-end)

Subsequent to the year end, following the 10:1 share consolidation implemented on 6 October 2025, the number of warrants outstanding and their exercise prices were adjusted in accordance with their respective terms. These adjustments were mechanical in nature and did not give rise to any accounting impact.

 

18.7.  Dilution

The warrants outstanding at the year-end are potentially dilutive. However, as the Group reported a loss for the year ended 30 September 2025, the warrants have not been included in the calculation of diluted loss per share in accordance with IAS 33 Earnings per Share. For the comparative year ended 30 September 2024, diluted earnings per share was presented where applicable in accordance with IAS 33.

 

19.  Financial instruments and risk management

 

19.1.  Accounting policy

The Group's financial instruments comprise cash and cash equivalents, trade and other receivables, and trade and other payables. Financial assets and liabilities are recognised when the Group becomes a party to the contractual provisions of the instrument.

 

Financial assets and liabilities are measured at amortised cost. The Group does not hold any derivative financial instruments and does not apply hedge accounting.

 

The Group has no outstanding loan balances at the reporting date. Historic loan and creditor balances that were derecognised in the prior year, following a review of their enforceability, are discussed in note 7 and do not give rise to any ongoing financial instrument or related risk exposure.

 

19.2.  Risk management objectives

The Group's principal financial risks are liquidity risk, credit risk and market risk. The Board is responsible for overseeing the management of these risks and has established policies and procedures that it considers appropriate to the size, complexity and stage of development of the Group.

 

Further detail on the principal risks facing the Group is set out in the Strategic Report.

 

19.3.  Liquidity risk

Liquidity risk is the risk that the Group will be unable to meet its financial obligations as they fall due. The Group manages liquidity risk by maintaining appropriate cash reserves and monitoring forecast cash flows.

 

As an early-stage operating and incubation business, the Group may require additional funding to execute its strategy. The Directors keep funding requirements under regular review and seek to ensure that sufficient resources are available to meet the Group's obligations as they fall due.

 

Trade and other payables are primarily due within three months.

 

19.4.  Credit risk

Credit risk is the risk of financial loss arising from a counterparty's failure to meet its contractual obligations. The Group's exposure to credit risk is limited, as it does not have material trade receivables.

 

Cash and cash equivalents are held with major financial institutions with strong credit ratings. The Directors do not consider the Group to be exposed to any significant concentration of credit risk.

 

19.5.  Market risk

Foreign currency risk

The Group has exposure to foreign currency risk arising primarily from operations conducted through its US subsidiary. Transactions denominated in foreign currencies are translated into sterling at the exchange rate prevailing at the date of the transaction.

 

The Group does not currently use financial instruments to hedge foreign currency exposure. Foreign exchange risk is monitored by the Board and considered to be manageable given the current scale of overseas activities.

 

Interest rate risk

The Group has limited exposure to interest rate risk, as it does not have material interest-bearing borrowings. Cash balances may be subject to variable interest rates; however, the impact of interest rate movements is not considered material.

 

20.  Related party transactions

 

Related parties comprise the Directors of the Company and entities over which they exercise control or significant influence.

 

All related party transactions were conducted on arm's-length terms unless otherwise stated.

 

20.1.  Directors' participation in fundraisings

During the year, certain Directors participated in equity and debt fundraisings undertaken by the Company, on the same terms as those offered to other investors:

 

·    In October 2024, Richard Edwards subscribed £37,500 as part of the fundraising announced on 17 October 2024. This comprised £16,750 in ordinary shares and £20,750 in convertible loan notes ("CLNs"). The CLNs were subsequently converted into ordinary shares, which were admitted to trading on 7 April 2025.

·    As part of the conditional fundraising announced on 12 March 2025, Richard Edwards subscribed £50,000, Professor Ronjon Nag subscribed £50,000 and Sarah Davy subscribed £12,500.

 

Further details of the resulting share issuances and conversions are set out in note 15.

 

20.2.  Professional fees

Included within administrative expenses for the year is an accrual of £14,000 payable to Coat Capital Limited in respect of accounting and financial reporting services. Coat Capital Limited is jointly owned by Richard Edwards, who served as a Director of the Company during the reporting period, and his spouse.

 

The balance remained outstanding at 30 September 2025 and is included within accruals.

 

As disclosed in prior period financial statements, administrative expenses for the year ended 30 September 2024 included accounting fees of £16,000 payable to Coat Capital Limited. This amount was settled during the current year through the issue of ordinary shares admitted to trading on 7 April 2025.

 

20.3.  Loan from connected party of a Director

As at 30 September 2024, the Company owed £16,000 to Bryan Dart, the brother of Geoffrey Gilbert Dart, who served as a Director of the Company during the reporting period.

 

On 12 November 2024, a payment of £16,000 was made in full and final settlement of the outstanding balance. The remaining balance of £10,687 was formally waived by Bryan Dart and was written back to profit or loss in the year ended 30 September 2024.

 

The loan was unsecured, interest free and repayable on demand.

 

20.4.  Stock loan

To facilitate the timely delivery of shares following warrant exercises announced on 2 May 2025, the Company entered into a short-term stock loan agreement with Richard Edwards, a Director of the Company during the period.

 

This related party transaction was approved by the independent directors and subsequently by shareholders at a General Meeting held on 28 May 2025. The stock loan was repaid in full through the allotment of ordinary shares on 9 June 2025.

 

20.5.  Intercompany management charges

During the year, the Company recognised an income accrual in respect of management services provided to capMedia, Inc, a wholly owned subsidiary. The income was recognised through an intercompany accrual at the reporting date, and invoiced post year end.

 

At 30 September 2025, an amount of £63,725 (2024: £nil) was included within other receivables in the Company balance sheet, with a corresponding accrual recognised in capMedia, Inc.

 

The balances were eliminated on consolidation. Accordingly, they do not form part of trade and other receivables, or trade or other creditors in the consolidated financial statements. Further details are set out in note 14.

 

20.6.  Share-based payments

During the year, the Company granted share options and conditional awards to certain Directors as part of its long-term incentive arrangements:

 

·    On 29 January 2025, 500,000,000 options were granted, comprising 400,000,000 to Richard Edwards and 100,000,000 to Sarah Davy.

·    On 12 March 2025, 1,875,000,000 options and conditional awards were granted, comprising 375,000,000 to Richard Edwards and 1,500,000,000 to Professor Ronjon Nag.

 

Further details of these arrangements, including vesting conditions and valuation assumptions, are disclosed in note 17. Post year end certain of these awards were modified, as disclosed in note 22.

 

20.7.  Outstanding balances

At 30 September 2025, other than the accruals disclosed in notes 20.2 and 20.5 above, there were no material balances outstanding with related parties.

 

21.  Ultimate controlling party

The Directors consider that the Company has no ultimate controlling party.

 

22.  Events after the reporting period

 

The following events occurred after the reporting period:

 

·    On 6 October 2025, the Company implemented a 10:1 share consolidation, whereby every ten existing ordinary shares were consolidated into one ordinary share. Further details are set out in note 16.

·    At the same time, the Company adopted new Articles of Association to reflect, inter alia, the share consolidation and the revised capital structure.

·    On 3 October 2025, the Company incorporated capMedical, Inc, a wholly owned subsidiary incorporated in the United States, to support the Group's planned expansion into AI-enabled applications in healthcare, medicine and related sectors.

·    Subsequent to the year end, there were changes to the Board, including the resignation of Richard Edwards and the appointment of Jack Allardyce as an Executive Director.

·    Following these Board changes, share option awards were modified and additional options were granted in accordance with the terms of the Company's long-term incentive arrangements. Further details are disclosed in note 17.

·    Adjustments were made to outstanding warrants and options to reflect the share consolidation. These adjustments were mechanical in nature and did not result in any accounting impact.

 

No other material events occurred after the reporting period that require disclosure or adjustment to the financial statements.