Falconedge PLC - Final Results for the year ended 31 May 2026

Other information and explanations

6. Bitcoin Treasury and Yield Activities

Falconedge's Bitcoin Yield Strategy, which became effective in December 2025, is designed to generate a transparent, compliant and repeatable return on the Company's Bitcoin treasury holdings, over and above the underlying price performance of Bitcoin.

Since inception, the strategy has generated a positive yield in every calendar month, delivering an average monthly return of 1.22% and a cumulative yield of 10.16% as at 1 August 2026. This has added the equivalent of approximately 1.96 BTC to the Company's treasury holdings and generated a fiat-​denominated return of £91,185.02 since inception.

7. Outlook

The Board's priority for the year ahead is to continue delivering the consistent, low-​risk monthly yield that the Bitcoin Yield Strategy has generated in every month since its December 2025 inception, while materially scaling the size of the Bitcoin holdings to which that strategy is applied. The Directors consider the strategy to be fully scalable and intend to explore several avenues over the coming months to grow the Company's Bitcoin treasury base, thereby increasing the absolute return generated for shareholders from the same disciplined, repeatable approach.

On the advisory side, the Company will continue to progress its discussions regarding further referral agreements, with the aim of finalising additional arrangements that build on the recurring fee income established during the year and further diversify the Company's revenue base.

In addition, the Company is always looking at potential accretive partnerships with revenue-​generating businesses that could be added to the Group and will continue to assess opportunities of this nature where they are expected to be complementary to, and supportive of, Falconedge's existing advisory and treasury activities.

Having streamlined its cost base during the year, the Company enters the new financial year as a lean organisation, with every member of the team positively contributing to business growth, and in a comfortable financial position from which to pursue the opportunities set out above.  The  Directors remain confident in the Company's differentiated, dual-​pillar model and in its ability to continue creating long-​term value for shareholders.

Year ended

Period ended

31 May

31 May

2026

2025

Notes

£

£

Revenue

2

151,197

-

Cost of sales

(114,064)

-

Gross profit

37,133

-

Administrative expenses

(728,781)

(488)

Operating loss

3

(691,648)

(488)

Investment revenues

6

7,994

651

Other gains and losses

7

(224,187)

-

(Loss)/profit before taxation

(907,841)

163

Income tax expense

8

-

-

(Loss)/profit and total comprehensive income for the year

(907,841)

163

Year

Period

ended

ended

31 May

31 May

2026

2025

Notes

Pence

Pence

Earnings per share

9

Basic

(0.13)

1.09

Diluted

(0.13)

1.09

Earnings per share from continuing operations

Basic

(0.13)

1.09

Diluted

(0.13)

1.09

Earnings per share from discontinued operations

Share capital

Share premium account

Equity reserve

Warrant equity reserve

Share option reserve

Retained earnings

Total

Year ended

Period ended

31 May 2026

31 May 2025

Notes

£

£

£

£

Cash flows from operating activities

Cash absorbed by operations

23

(437,567)

(448)

Net cash outflow from operating activities

(437,567)

(448)

Investing activities

Purchase of intangible assets

(1,524,124)

-

Purchase of Investments

(297,882)

-

Receipts from sale of Investments

74,902

Interest received

7,994

651

Net cash (used in)/generated from investing activities

(1,739,110)

651

Financing activities

Proceeds from issue of shares

1,399,567

1

Share issue costs

(215,248)

-

Issue of convertible loans

1,000,000

-

Net cash generated from financing activities

2,184,319

1

Net increase in cash and cash equivalents

7,642

204

Cash and cash equivalents at beginning of year

204

-

Cash and cash equivalents at end of year

7,846

204

Non-cash transactions

During the period, convertible loan notes with a principal value of £1,000,000 were converted into ordinary shares of  the Company. Also, during the year, the Company transferred 19 Bitcoin in exchange for 1,900 Class C participating shares in Falcon Hybrid SPC, relating to the Paravene-Falcon Protected Leverage Fund SP. The non-cash consideration was valued at £1,331,325 at the transaction date.

These transactions did not involve cash or cash equivalents and have therefore been excluded from investing cash receipts and payments in the statement of cash flows.

Other financial liabilities

Other financial liabilities, including borrowings, trade payables and other short-​term monetary liabilities, are initially measured at fair value net of transaction costs directly attributable to the issuance of the financial liability. They are subsequently measured at amortised cost using the effective interest method. For the purposes of each financial liability, interest expense includes initial transaction costs and any premium payable on redemption, as well as any interest or coupon payable while the liability is outstanding.

Derecognition of financial liabilities

Financial liabilities are derecognised when, and only when, the company’s obligations are discharged, cancelled, or they expire.

1.10

Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

1.11

Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither taxable profit nor accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities, and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.12

Employee benefits

The costs of short-​term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of inventories or non-​current assets.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminating an employee's employment or providing termination benefits.

1.13

Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.14

Share-based payments

The Company operates equity-​settled share-​based remuneration plans for employees and eligible third-​party service providers. Equity-​settled share-​based payments are measured at the fair value of the equity instruments at the grant date using the Black-​Scholes option pricing model.

The fair value determined at the grant date is expensed on a straight-​line basis over the vesting period, based on the Company’s estimate of equity instruments that will eventually vest, with a corresponding credit to the Share-​Based Payment Reserve within equity. Upon the exercise of options, the balance in this reserve is transferred to Share Capital and Share Premium.

When the terms and conditions of equity-​settled share-​based payments at the time they were granted are subsequently modified, the fair value of the share-​based payment under the original terms and conditions and under the modified terms and conditions are both determined at the date of the modification.  Any excess of the modified fair value over the original fair value is recognised over the remaining vesting period in addition to the grant date fair value of the original share-​based payment.  The share-​based payment expense is not adjusted if the modified fair value is less than the original fair value.

Cancellations or settlements (including those resulting from employee redundancies) are treated as an acceleration of vesting and the amount that would have been recognised over the remaining vesting period is recognised immediately.

2

Revenue

2026

2025

£

£

Revenue analysed by class of business

Sale of services

151,197

-

2026

2025

£

£

Revenue analysed by geographical market

United Kingdom

151,197

-

3

Operating loss

2026

2025

Operating loss for the year is stated after charging/(crediting):

£

£

Exchange gains

(3,071)

(12)

Fees payable to the company's auditor for the audit of the company's financial statements

18,000

-

Loss on disposal of intangible assets

165,502

-

Share-based payments

84,254

-

4

Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2026

2025

Number

Number

4

1

Their aggregate remuneration comprised:

2026

2025

£

£

Wages and salaries

213,248

-

Pension costs

1,461

-

214,709

-

5

Directors' remuneration

2026

2025

£

£

Remuneration for qualifying services

106,900

-

6

Investment income

2026

2025

£

£

Interest income

Financial instruments measured at amortised cost:

Bank deposits

7,994

-

Other interest income on financial assets

-

651

Total interest revenue

7,994

651

Income above relates to assets held at amortised cost, unless stated otherwise.

7

Other gains and losses

2026

2025

£

£

Change in value of financial assets at fair value through profit or loss

(224,187)

8

Income tax expense

2026

2025

          Tax expense comprises:

£

£

Current tax expense in respect of current year                                                                             -                      -

Deferred tax expense in respect of current year                                                                           -                      -

Total income tax                                                                                                                          -                      -         

2026

2025

£

£

(Loss) from continuing operations

(907,841)

163

Income tax expense calculated at: 25% (2025: 19%)

(226,960)

31

Effect of non-taxable income

-

(31)

Effect of expenses that are not deductible in determining taxable profit

21,354

-

Effect of revaluations of assets for taxation purposes

55,467

-

Impairment losses that are not deductible

1,643

-

Effect of unused tax losses and tax offsets not recognised as deferred tax assets

148,496

-

Income tax expense recognised in the Income Statement

-

-

9

Earnings per share

2026

2025

Number

Number

Number of shares

Weighted average number of ordinary shares for basic earnings per share

690,979,692

14,925

2026

2025

Earnings

£

£

Continuing operations

Loss/profit for the period from continuing operations

(907,841)

2026

2025

£ per share

£ per share

Basic and diluted earnings per share

From continuing operations

-

0.01

10

Intangible assets

Cost

Additions - purchased

1,524,124

Disposals

(1,496,827)

At 31 May 2026

27,297

10

Amortisation and impairment

Impairment loss

6,570

At 31 May 2026

6,570

Carrying amount

At 31 May 2026

20,727

At 31 May 2026, the company held a total of 0.3785 Bitcoin (BTC), comprising 0.3785 BTC held on the exchanges. These holdings were acquired in November 2025 at an average cost of £72,118 per BTC.

Bitcoin held directly by the Company for treasury investment purposes is recognised as an intangible asset under IAS 38. It is initially measured at acquisition cost, including directly attributable acquisition costs, and subsequently carried at cost less accumulated impairment losses.

Bitcoin is assessed as having an indefinite useful life and is therefore not amortised. It is tested for impairment annually and whenever circumstances indicate that its carrying amount may not be recoverable.

An impairment loss is recognised in the income statement when the carrying amount exceeds the recoverable amount, being the higher of fair value less costs of disposal and value in use. Subsequent impairment reversals are recognised in the income statement, limited to the carrying amount that would have applied had no impairment been recognised.

11

Investments

Current

Non-current

2026

2025

2026

2025

£

£

£

£

Investments held at fair value through profit or loss

234,501

-

-

-

Financial assets at fair value through profit or loss

-

-

1,097,935

-

234,501

-

1,097,935

-

During the year, the company subscribed for Class B and Class C participating shares in Falcon Hybrid SPC in respect of the Paravene-​Falcon Protected Leverage Fund SP.

At 31 May 2026, the company held 253.02 Class B participating shares, denominated in fiat currency, with a fair value of £234,501.

At 31 May 2026, the company also held 1,900 Class C participating shares, denominated in Bitcoin (BTC). The fund holds the BTC in a designated wallet, and redemption proceeds will be settled in BTC rather than sterling.

The administrator’s statement reported an aggregate net asset value (NAV) of 20.07126665 BTC for the Class C shareholding. Using the BTC price of £54,701.86 at the reporting date, the sterling fair value of this investment was £1,097,935.

Fair value of financial assets carried at fair value through profit or loss

The Company’s investments in Class B and Class C participating shares in Falcon Hybrid SPC, relating to the Paravene-​Falcon Protected Leverage Fund SP, are classified as financial assets at fair value through profit or loss.

The investments are initially recognised at fair value, with directly attributable transaction costs recognised as an expense. Subsequently, the investments are measured at fair value at each reporting date. All resulting gains and losses are recognised within other gains and losses in the income statement.

Movements in non-current investments

Investments

£

Cost or valuation

At 1 June 2025

-

Additions

1,331,325

Disposals

-

At 31 May 2026

1,331,325

Fair value movement

At 1 June 2025

-

Fair value loss

(233,390)

At 31 May 2026

(233,390)

Carrying amount

At 31 May 2026

1,097,935

At 31 May 2025

-

On 17 July 2025, the Company issued one additional ordinary share of £1 for £1. On 10 September 2025, the two existing ordinary shares of £1 each were subdivided into 29,850 ordinary shares of £0.000067 each. A further 749,970,150 ordinary shares were allotted on that date for aggregate consideration of £50,248, bringing the number of shares in issue before the IPO to 750,000,000.

The comparative share number and the July allotment shown above have been adjusted to reflect the subdivision. At 31 May 2025, the legal issued share capital comprised one ordinary share of £1, equivalent to 14,925 shares following the subdivision. This adjustment does not change the comparative share capital balance of £1.

18

Share premium account

2026

2025

£

£

At the beginning of the year

-

-

Issue of new shares

2,427,377

-

Share issue expenses

(310,768)

-

(141,998)

-

At the end of the year

1,974,611

-

19

Warrant equity reserve

2026

2025

£

£

At the beginning of the year

-

-

Additions

141,998

-

At the end of the year

141,998

-

20

Share option reserve

2026

2025

£

£

At the beginning of the year

-

-

Additions

84,254

-

At the end of the year

84,254

-

21

Capital risk management

The company is not subject to any externally imposed capital requirements.

22

Related party transactions

Remuneration of key management personnel

The remuneration of key management personnel, including directors, is set out below in aggregate for each category specified in IAS 24 Related Party Disclosures.

2026

2025

£

£

Short-term employee benefits

106,900

-

Share-based payments

49,782

-

156,682

-

Other transactions with related parties

During the year, the company entered into the following transactions with Falcon Investment Management Ltd (a company controlled by one of the directors):

2026

2025

2026

2025

£

£

£

£

150,901

-

266,734

-