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FintechWerx International Software Services — Interim / Quarterly Report 2026
Apr 1, 2026
48470_rns_2026-04-01_51769931-6361-4ee8-a364-838031203761.pdf
Interim / Quarterly Report
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FINTECHWERX INTERNATIONAL SOFTWARE SERVICES INC.
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
For the Three and Nine Months Ended January 31, 2026
(Expressed in Canadian dollars)
(Unaudited – Prepared by Management)
NOTICE OF NO AUDITOR REVIEW OF CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
In accordance with National Instrument 51-102 released by the Canadian Securities Administrators, the Company discloses that its auditors have not reviewed the unaudited condensed interim consolidated financial statements for the nine-month period ended January 31, 2026.
The accompanying unaudited condensed interim consolidated financial statements of the Company have been prepared by and are the responsibility of the Company's management
Fintechwerx International Software Services Inc.
Index to Condensed Interim Consolidated Financial Statements
January 31, 2026
| CONTENT | PAGE(S) |
|---|---|
| Condensed Interim Consolidated Statements of Financial Position | 4 |
| Condensed Interim Consolidated Statements of Loss and Comprehensive Loss | 5 |
| Condensed Interim Consolidated Statements of Changes in Shareholders’ Equity | 6 |
| Condensed Interim Consolidated Statements of Cash Flows | 7 |
| Notes to the Condensed Interim Consolidated Financial Statements | 8-19 |
FINTECHWERX INTERNATIONAL SOFTWARE SERVICES INC.
Condensed Interim Consolidated Statements of Financial Position
(Unaudited - Expressed in Canadian dollars)
| | January 31, 2026
$ | April 30, 2025
$ |
| --- | --- | --- |
| Assets | | |
| Current assets | | |
| Cash and cash equivalents | 2,318,805 | 84,141 |
| Trade and other receivables | 87,530 | 24,984 |
| Due from related party (Note 7) | 237,100 | 222,753 |
| Prepaids and deposit | 26,925 | 13,997 |
| Total current assets | 2,670,360 | 345,875 |
| Non-current assets | | |
| Intangible assets (Note 3) | 1,279,202 | 1,415,629 |
| Total Assets | 3,949,562 | 1,761,504 |
| Liabilities and Shareholders’ Equity | | |
| Liabilities | | |
| Current liabilities | | |
| Accounts payable and accrued liabilities (Notes 4 and 5) | 175,443 | 223,807 |
| Loans payable (Note 5) | 98,625 | 38,625 |
| Due to related parties (Note 7) | 255,113 | 374,348 |
| Total Liabilities | 529,181 | 636,780 |
| Shareholders’ Equity | | |
| Share capital (Note 8) | 5,495,195 | 2,258,200 |
| Equity reserves (Note 8) | 326,460 | 297,434 |
| Subscriptions receivable (Note 8) | (3,500) | – |
| Accumulated deficit | (2,397,774) | (1,430,910) |
| Total Shareholders’ Equity | 3,420,381 | 1,124,724 |
| Total Liabilities and Shareholders’ Equity | 3,949,562 | 1,761,504 |
Nature and continuance of operations (Note 1)
Subsequent events (Note 12)
Approved and authorized for dissemination by the Board of Directors on April 1, 2026:
“Francisco Carasquero”
“George Hofsink”
Francisco Carasquero, Director
George Hofsink, Director
The accompanying notes are integral to these condensed interim consolidated financial statements.
4
FINTECHWERX INTERNATIONAL SOFTWARE SERVICES INC.
Condensed Interim Consolidated Statements of Loss and Comprehensive Loss
For the Three and Nine Months Ended January 31, 2026
(Unaudited - Expressed in Canadian dollars)
| For the three months ended January 31, 2026 $ | For the three months ended January 31, 2025 $ | For the nine months ended January 31, 2026 $ | For the nine months ended January 31, 2025 $ | |
|---|---|---|---|---|
| Revenue | 28,922 | 897 | 40,242 | 11,362 |
| Cost of sales (Note 3) | (5,941) | (30,910) | (28,278) | (124,406) |
| Gross income (loss) | 22,981 | (30,013) | 11,964 | (113,044) |
| Operating Expenses | ||||
| Amortization (Note 3) | 41,155 | 2,576 | 114,760 | 11,478 |
| General and administration | 30,237 | 20,179 | 117,845 | 34,071 |
| Listing fees | - | - | - | 15,468 |
| Management and consulting fees (Note 7) | 108,406 | 62,250 | 237,406 | 193,500 |
| Marketing and shareholder communications | 80,768 | - | 223,280 | - |
| Professional fees | 65,030 | 30,484 | 146,052 | 112,694 |
| Regulatory and transfer agent fees | 9,383 | 3,725 | 20,846 | 14,127 |
| Share-based compensation (Note 8) | 1,497 | - | 29,026 | - |
| Software development cost (Note 7) | 16,704 | - | 55,955 | - |
| Travel and accommodation | 9,527 | 2,508 | 35,548 | 4,221 |
| Total operating expenses | (362,707) | (121,722) | (980,718) | (385,559) |
| Net loss before other items | (339,726) | (151,735) | (968,754) | (498,603) |
| Other income or expense | ||||
| Interest expense | (5,501) | (813) | (13,707) | (813) |
| Interest income | 4,852 | 4,159 | 15,597 | 7,684 |
| Net loss and comprehensive loss | (340,375) | (148,389) | (966,864) | (491,732) |
| Loss per share, basic and diluted | (0.01) | (0.01) | (0.04) | (0.05) |
| Weighted average shares outstanding, basic and diluted | 30,247,991 | 21,251,932 | 26,311,716 | 9,480,120 |
The accompanying notes are integral to these condensed interim consolidated financial statements
FINTECHWERX INTERNATIONAL SOFTWARE SERVICES INC.
Condensed Interim Consolidated Statements of Changes in Shareholders' Equity
For the Nine Months Ended January 31, 2026
(Unaudited - Expressed in Canadian dollars except the number of shares)
| Common shares | Equity reserves $ | Subscriptions receivable $ | Accumulated deficit $ | Total shareholders' equity $ | ||
|---|---|---|---|---|---|---|
| Number of shares | Amount $ | |||||
| Balance, April 30, 2024 | 3,235,410 | 841,200 | – | – | (471,586) | 369,614 |
| Shares issued pursuant to amalgamation agreement | 560,000 | 392,000 | – | – | – | 392,000 |
| Units issued pursuant to amalgamation agreement with 1378871 B.C. Ltd. | 20,000,000 | 1,000,000 | 297,434 | – | – | 1,297,434 |
| Shares issued pursuant to the settlement of debt | 500,000 | 25,000 | – | – | – | 25,000 |
| Net loss for the period | – | – | – | – | (491,732) | (491,732) |
| Balance, January 31, 2025 | 24,295,410 | 2,258,200 | 297,434 | – | (963,318) | 1,592,316 |
| Balance, April 30, 2025 | 24,295,410 | 2,258,200 | 297,434 | – | (1,430,910) | 1,124,724 |
| Shares issued pursuant to warrant exercises | 21,327,000 | 2,953,330 | – | (4,750) | – | 2,948,580 |
| Shares issued pursuant to option exercises | 65,000 | 35,750 | – | – | – | 35,750 |
| Units issued for cash | 223,214 | 250,000 | – | – | – | 250,000 |
| Share issuance cost | – | (2,085) | – | – | – | (2,085) |
| Warrants subscribed | – | – | – | 1,250 | – | 1,250 |
| Share-based compensation | – | – | 29,026 | – | – | 29,026 |
| Net loss for the period | – | – | – | – | (966,864) | (966,864) |
| Balance, January 31, 2026 | 45,910,624 | 5,495,195 | 326,460 | (3,500) | (2,397,774) | 3,420,381 |
(*) The Company effected a 10:1 share consolidation on August 20, 2024. All share and per share amounts have been retrospectively presented to reflect the share consolidation.
The accompanying notes are integral to these condensed interim consolidated financial statements.
FINTECHWERX INTERNATIONAL SOFTWARE SERVICES INC.
Condensed Interim Consolidated Statements of Cash Flows
For the Nine Months Ended January 31, 2026
(Unaudited - Expressed in Canadian dollars)
| For the nine months ended January 31, 2026 $ | For the nine months ended January 31, 2025 $ | |
|---|---|---|
| Operating activities | ||
| Net loss | (966,864) | (491,732) |
| Items not involving cash: | ||
| Amortization | 136,427 | 16,898 |
| Share-based compensation | 29,026 | – |
| Changes in non-cash operating working capital: | ||
| Prepaids and deposit | (12,928) | – |
| Trade and other receivables | (62,546) | 20,243 |
| Accounts payable and accrued liabilities | (48,364) | (25,545) |
| Due to related parties | (133,582) | (139,869) |
| Net cash and cash equivalents used in operating activities | (1,058,831) | (620,005) |
| Investing activities | ||
| Cash acquired from amalgamation with 1396015 B.C. Ltd. | – | 399 |
| Cash acquired upon amalgamation with 1378871 B.C. Ltd. | – | 394,715 |
| Intangible asset additions | – | (40,000) |
| Net cash and cash equivalents provided by investing activities | – | 355,114 |
| Financing activities | ||
| Proceeds from loans payable | 310,000 | – |
| Repayment of loans | (250,000) | – |
| Loan from related party | 10,000 | – |
| Repayment of related party loan | (10,000) | – |
| Proceeds from warrant and option exercises | 2,984,330 | – |
| Subscription received for warrant exercise | 1,250 | – |
| Proceeds from issuance of units | 250,000 | – |
| Share issuance costs | (2,085) | – |
| Net cash and cash equivalents provided by financing activities | 3,293,495 | – |
| Change in cash and cash equivalents | 2,234,664 | (264,891) |
| Cash and cash equivalents, beginning of period | 84,141 | 485,503 |
| Cash and cash equivalents, end of period | 2,318,805 | 220,612 |
| Non-cash investing and financing activities: | ||
| Common shares issued pursuant to amalgamation agreement | – | 392,000 |
| Common shares issued pursuant to the settlement of debt | – | 25,000 |
| Units issued pursuant to amalgamation agreement with 1378871 B.C. Ltd. | – | 1,297,434 |
| Supplemental disclosures: | ||
| Interest paid | – | – |
| Income taxes paid | – | – |
The accompanying notes are integral to these condensed interim consolidated financial statements.
FINTECHWERX INTERNATIONAL SOFTWARE SERVICES INC.
Notes to the Condensed Interim Consolidated Financial Statements
For the Three and Nine Months Ended January 31, 2026
(Unaudited - Expressed in Canadian dollars)
- Nature and Continuance of Operations
Fintechwerx International Software Services Inc. (formerly 1378882 B.C. Ltd.) (the "Company") was incorporated under the Business Corporations Act (British Columbia) on September 14, 2022. On November 21, 2022, the Company changed its name from 1378882 B.C. Ltd. to Fintechwerx International Software Services Inc. On December 8, 2023, the Company began trading on the Canadian Stocks Exchange under the stock symbol "WERX". On August 26, 2024, the Company began trading on the Frankfurt Stock Exchange under the stock symbol "J500".
The Company's registered office address is 1275 W 6th Avenue, Suite 315, Vancouver, British Columbia, Canada, V6H 1A6. The Company's business is an e-commerce technology company.
These condensed interim consolidated financial statements have been prepared by management on a going concern basis which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. At January 31, 2026, the Company had not yet achieved profitable operations, had accumulated losses of $2,397,774 since its inception, and expects to incur further losses in the development of its business, all of which casts significant doubt about the Company's ability to continue as a going concern. The Company is dependent upon making sales or raising debt and equity financing to provide the funding necessary to meet its general operating expenses and will require additional financing to continue to develop and deploy its technology. The continuing operations of the Company are dependent upon its ability to continue to raise adequate financing and to commence profitable operations in the future and repay its liabilities arising from normal business operations as they become due.
These condensed interim consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue in existence. Such adjustments could be material.
- Basis of Presentation
Statement of Compliance
These condensed interim consolidated financial statements, including comparatives, have been prepared in accordance with International Accounting Standards 34, Interim Financial Reporting, using accounting policies consistent with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board and interpretations of the International Financial Reporting Interpretations Committee. The accounting policies and methods of computation applied by the Company in these condensed interim consolidated financial statements are the same as those applied in the Company's annual financial statements for the year ended April 30, 2025.
The condensed interim consolidated financial statements do not include all of the information and note disclosures required for full annual financial statements and should be read in conjunction with the Company's annual financial statements as at and for the year ended April 30, 2025.
FINTECHWERX INTERNATIONAL SOFTWARE SERVICES INC.
Notes to the Condensed Interim Consolidated Financial Statements
For the Three and Nine Months Ended January 31, 2026
(Unaudited - Expressed in Canadian dollars)
2. Basis of Presentation (continued)
Basis of Consolidation
The Company’s condensed interim consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Smartwerx Solutions Inc., incorporated in British Columbia, Canada.
A subsidiary is an entity controlled by the Company, where control is achieved by the Company having the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Company controls another entity. The condensed interim consolidated financial statements are consolidated from the date on which control is obtained by the Company and are de-consolidated from the date that control ceases. All intercompany transactions and balances have been eliminated.
Basis of Presentation
These condensed interim consolidated financial statements have been prepared on an historical cost basis, except for financial instruments classified as financial instruments at fair value through profit or loss, which are stated at fair value. In addition, these condensed interim consolidated financial statements have been prepared using the accrual basis of accounting except for cash flow information. These condensed interim consolidated financial statements are presented in Canadian dollars, which is the Company’s functional currency.
Significant Accounting Judgments, Estimates and Assumptions
The preparation of these condensed interim consolidated financial statements in conformity with IFRS requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed interim consolidated financial statements and the reported revenues and expenses during this period. Although management uses historical experience and its best knowledge of the amount, events, or actions to form the basis for judgments and estimates, actual results may differ from these estimates. Critical judgments and estimates exercised in applying accounting policies that have the most significant effect on the amounts recognized in the condensed interim consolidated financial statements are as follows:
Significant Accounting Judgements
Going concern
The assessment of the Company’s ability to continue as a going concern and to raise sufficient funds to pay for its ongoing operating expenditures and meet its liabilities for the ensuing year involves significant judgment based on historical experience and other factors, including expectation of future events that are believed to be reasonable under the circumstances.
Useful life and Impairment of intangible assets
The carrying value and the recoverability of intangible assets, including software licenses, are evaluated at each reporting date. Management assesses for indicators of impairment, which includes assessing whether facts or circumstances exist that suggest the carrying amount exceeds the recoverable amount. Management also applies judgement in assessing the useful life of intangible assets.
FINTECHWERX INTERNATIONAL SOFTWARE SERVICES INC.
Notes to the Condensed Interim Consolidated Financial Statements
For the Three and Nine Months Ended January 31, 2026
(Unaudited - Expressed in Canadian dollars)
2. Basis of Presentation (continued)
Significant Accounting Judgments, Estimates and Assumptions (continued)
Significant Accounting Judgements (continued)
Revenue
The identification of revenue-generating contracts with customers, the identification of performance obligations, the determination of the transaction price and allocation between identified performance obligations, the use of appropriate revenue recognition method for each performance obligation and the measure of progress for performance obligation satisfied over time are the man aspects of the revenue recognition, all of which require the exercise of judgment and use of assumptions. The Company primarily derives revenue from the sale of its software plug-in that allows for automated reconciliation for Email Money Transfer ("EMT") records and the sublicense of its license that provides services consisting of the collection, storage and transmission of transaction data between a merchant and a processor (the "Gateway License"). Revenue includes subscriptions derived from software sales.
Key Sources of Estimation Uncertainty
Share-based payments and warrants
The estimation of share-based payment costs and warrant values requires the selection of an appropriate valuation model and consideration as to the inputs necessary for the valuation model chosen. The Company has made estimates as to the expected volatility of its own shares, the expected life of share options and warrants granted, the estimated number of share options and warrants expected to vest and the expected time of exercise of those stock options and warrants. The model used by the Company is the Black-Scholes option pricing valuation model.
Income taxes
In assessing the probability of realizing income tax assets, management makes estimates related to expectations of future taxable income, applicable tax opportunities, expected timing of reversals of existing temporary differences and the likelihood that tax positions taken will be sustained upon examination by applicable tax authorities. In making its assessments, management gives additional weight to positive and negative evidence that can be objectively verified. No deferred tax assets have been deemed probable to date.
Accounting Standards Issued But Not Yet Effective or Adopted
Certain pronouncements have been issued by the IASB that are mandatory for annual accounting periods after April 30, 2025. None of these pronouncements are expected to have a material impact on the Company's condensed interim consolidated financial statements upon adoption.
FINTECHWERX INTERNATIONAL SOFTWARE SERVICES INC.
Notes to the Condensed Interim Consolidated Financial Statements
For the Three and Nine Months Ended January 31, 2026
(Unaudited - Expressed in Canadian dollars)
3. Intangible Assets
| EMT Plug-in Technology $ | Enrollment Technology $ | Gateway License $ | Total $ | |
|---|---|---|---|---|
| Balance, April 30, 2025 | 807,492 | 473,417 | 134,720 | 1,415,629 |
| Amortization | (78,339) | (45,125) | (12,963) | (136,427) |
| Balance, January 31, 2026 | 729,153 | 428,292 | 121,757 | 1,279,202 |
I. EMT Plug-in Technology
On November 14, 2024, the Company completed its acquisition of 1378871 B.C. Ltd., resulting in the acquisition of the EMT Plug-in technology. The estimated remaining life of the EMT Plug-in technology at the time of acquisition was 8.2 years.
II. Enrollment Technology
This license automates business identity verification, automating the onboarding of merchants, independent sales organizations, and consumers and their payment service applications, providing payment gateway integration and payment processor integration.
On July 31, 2024, the Company completed its acquisition of 1396015 B.C. Ltd., resulting in the acquisition of the Enrollment technology. The estimated remaining life of the Enrollment technology at the time of acquisition was 8.6 years.
II. Gateway License
On February 22, 2023 ("Effective Date"), the Company acquired a license from CPT Secure Inc. which provides services consisting of the collection, storage and transmission of transaction data between a merchant and a processor (the "Gateway License"). The Company recorded a fair value of $100,000 to acquire this license for the license term of 2 years.
On August 1, 2023, the Company signed the first amended and restated agreement with CPT Secure Inc. amending the fees for initial and renewal terms. On October 12, 2023, the Company signed the second amended and restated agreement wherein the parties agreed to supersede the first amended terms and fees and replaced by the second amended terms and fees.
As per the second amended and restated agreement, CPT Secure Inc. acknowledges that, under the original license agreement, the Company paid $50,000 towards the license fee to cover the first year of the 10-year term ("Initial Term"). For the subsequent 9 years of the Initial Term and for each year of the additional 5-year term ("Renewal Term"), unless otherwise agreed to by the parties, the Company shall pay CPT Secure Inc. $50,000 for the license for each year of the balance of the Initial Term and for each year of the Renewal Term and are due on each applicable anniversary of the effective date of the original license agreement. The total value of the software license with CPT Secure Inc. after the second amended agreement and the completion of the Initial Term is $500,000.
FINTECHWERX INTERNATIONAL SOFTWARE SERVICES INC.
Notes to the Condensed Interim Consolidated Financial Statements
For the Three and Nine Months Ended January 31, 2026
(Unaudited - Expressed in Canadian dollars)
3. Intangible Assets (continued)
The unamortized license fee at the amendment date is amortized over the remaining term of the agreement using the straight-line method as the term of the agreement was extended. Each subsequent license fee payment of $50,000 will be capitalized when it becomes due as the Company retains rights of termination under various conditions.
At the time of entering into the above agreements, 1378871 B.C. Ltd., 1396015 B.C. Ltd. and CPT Secure Inc. were related to the Company by common directors, Francisco Carasquero and George Hofsink.
During the nine months ended January 31, 2026, the Company incurred amortization of software licenses of $136,427 (2025 – $16,898), of which $21,667 (2025 – $5,420) was included in cost of sales. The amortization for the EMT Plug-in technology was included in cost of sales up to May 2025, at which point the Company ceased generating revenue from the technology and began recognizing its amortization in operating expenses. The amortization for the Gateway license is included in cost of sales while the amortization for the Enrollment technology is included in operating expenses as no revenue was generated from the technology during the nine months ended January 31, 2026 and 2025.
4. Accounts Payable and Accrued Liabilities
| January 31, 2026 | April 30, 2025 | |
|---|---|---|
| $ | $ | |
| Accounts payable | 121,583 | 151,259 |
| Accrued liabilities | 53,860 | 72,548 |
| Total | 175,443 | 223,807 |
5. Loans Payable
Upon closing of the amalgamation with 1378871 B.C. Ltd. on November 14, 2024, the Company assumed loans payable totaling $38,625 which are secured against assets of the Company, bear interest at 5% per annum commencing November 1, 2024, and were due on September 10, 2025.
At January 31, 2026, the Company owed a loan payable of $50,000 (April 30, 2025 – $nil) which is unsecured, bears interest at 8% per annum and due on June 22, 2026.
At January 31, 2026, the Company owed a loan payable of $10,000 (April 30, 2025 – $nil) which is unsecured, non-interest bearing and has no specific terms of repayment.
During the nine months ended January 31, 2026, the Company received two loans payable totaling $250,000, which were repaid in January 2026. The loans were unsecured, bore interest at 8% per annum and due on July 17, 2026.
At January 31, 2026, accrued interest of $16,505 (April 30, 2025 – $2,869) is included in accounts payable and accrued liabilities.
12
FINTECHWERX INTERNATIONAL SOFTWARE SERVICES INC.
Notes to the Condensed Interim Consolidated Financial Statements
For the Three and Nine Months Ended January 31, 2026
(Unaudited - Expressed in Canadian dollars)
6. Related Party Loan Payable
During the nine months ended January 31, 2026, the Company received a loan payable of $10,000 from a company controlled by the Chief Financial Officer ("CFO") and director of the Company, which was repaid in December 2025. The loan was unsecured, non-interest bearing and due on demand.
7. Related Party Transactions
Key management personnel are the persons responsible for the planning, directing and controlling the activities of the Company and includes both executive and non-executive directors, and entities controlled by such persons. The Company considers all directors and officers of the Company to be key management personnel. The following are the remuneration of the Company's related parties:
| For the nine months ended January 31, 2026 | For the nine months ended January 31, 2025 | |
|---|---|---|
| $ | ||
| Management and consulting fees | 180,000 | 180,000 |
| Management fees included in cost of sales | - | 52,574 |
| Software license fee and development costs | 49,779 | 40,000 |
| 229,779 | 272,574 |
Balances
At January 31, 2026, the Company owed $11,854 (April 30, 2025 – $3,853) to the Chief Financial Officer ("CFO") and director of the Company for expenses incurred on behalf of the Company, and $135,670 (April 30, 2025 – $121,170) to a company controlled by the CFO and director of the Company for management and consulting fees. The amounts owing are unsecured, non-interest bearing and have no specified terms of repayment.
At January 31, 2026, there is a prepaid balance of $46,000 (April 30, 2025 – the Company owed $29,250) to a company controlled by the Chief Executive Officer ("CEO") of the Company. The amount owing is unsecured, non-interest bearing and has no specified terms of repayment.
At January 31, 2026, the Company owed $18,843 (April 30, 2025 – $34,500) of management and consulting fees to the President of the Company, and $3,150 (April 30, 2025 – $3,150) to a company controlled by the President of the Company for marketing expenses. The amount owing is unsecured, non-interest bearing and has no specified terms of repayment.
At January 31, 2026, the Company owed $nil (April 30, 2025 – $49,768) for software license fees to a company controlled by directors and officers of the Company. The amount owed was paid under the terms of its related software license agreement (Note 3).
At January 31, 2026, the Company owed $2,674 (April 30, 2025 – $3,735) of consulting expense to a company controlled by the Chief Technology Officer ("CTO") of the Company. At January 31, 2026, there is a prepaid balance of $5,778 (April 30, 2025 – $5,778) to the CTO within due to related parties for consulting fees. The amount owing is unsecured, non-interest bearing and has no specified terms of repayment.
FINTECHWERX INTERNATIONAL SOFTWARE SERVICES INC.
Notes to the Condensed Interim Consolidated Financial Statements
For the Three and Nine Months Ended January 31, 2026
(Unaudited - Expressed in Canadian dollars)
7. Related Party Transactions (continued)
Upon closing of the amalgamation with 1396015 B.C. Ltd. on July 31, 2024, the Company assumed an amount payable of $134,700 to LGM, a company controlled by the CFO and director of the Company. As at January 31, 2026, the Company owed an amount of $134,700 (April 30, 2025 – $134,700) to LGM. The amount owing is unsecured, non-interest bearing and has no specified terms of repayment.
Upon closing of the amalgamation with 1378871 B.C. Ltd. on November 14, 2024, the Company assumed promissory notes receivable owing from LGM, with principal amounts totaling $134,250 and accrued interest receivable of $4,385, net of an allowance of $108,007. During the year ended April 30, 2025, the Company loaned an additional $80,000 to LGM and recognized accrued interest receivable of $4,118. The promissory notes receivable are unsecured, bear interest at 8% per annum and have maturity dates ranging from March 31, 2025 to February 28, 2026. As at January 31, 2026, the Company was owed an amount of $237,100 (April 30, 2025 – $222,753) from LGM.
8. Share Capital and Equity Reserves
Authorized
- Unlimited number of common shares without par value
- Up to 400,000 Class A Preferred Series 1 Convertible Shares without par value (Non-voting, convertible to 25 common shares of the Company for each Class A Preferred Series 1 Convertible Share)
Issued Share Capital
During the nine months ended January 31, 2026, the Company issued a total of 21,327,000 common shares pursuant to the exercise of warrants with exercise prices ranging between $0.10 per share and $0.34 per share for gross proceeds of $2,948,580, net of subscription receivable of $4,750.
During the nine months ended January 31, 2026, the Company issued a total of 65,000 common shares pursuant to the exercise of stock options with exercise price of $0.55 per share for gross proceeds of $35,750.
On January 15, 2026, the Company issued 223,214 units at $1.12 per unit for gross proceeds of $250,000. Each unit consists of one common share and one common share purchase warrant to purchase a common share at $1.39 per share for a period of 2 years from the closing date. In connection with the private placement, the Company incurred $2,085 of share issuance costs.
During the nine months ended January 31, 2026, the Company recognized subscriptions received of $1,250 for warrants exercised subsequent to the nine months ended January 31, 2026.
Escrow Shares
The Company had 192,000 common shares held in escrow as at January 31, 2026 (April 30, 2025 – 384,000), which will be released in tranches over a 36-month period, beginning on the listing date. The release will occur every six months following the Initial Release, with the initial release comprising 64,000 of the escrowed securities, and each subsequent release comprising 96,000 escrowed securities.
FINTECHWERX INTERNATIONAL SOFTWARE SERVICES INC.
Notes to the Condensed Interim Consolidated Financial Statements
For the Three and Nine Months Ended January 31, 2026
(Unaudited - Expressed in Canadian dollars)
8. Share Capital and Equity Reserves (continued)
Warrants
A summary of the continuity of the Company’s warrants for the nine months ended January 31, 2026 is as follows:
| Number of warrants | Weighted average exercise price $ | |
|---|---|---|
| Balance, April 30, 2025 | 21,511,000 | 0.14 |
| Issued | 223,214 | 1.39 |
| Exercised | (21,327,000) | 0.14 |
| Balance, January 31, 2026 | 407,214 | 0.87 |
Warrants outstanding and exercisable at January 31, 2026 are as follows:
| Number of warrants | Exercise price $ | Expiry date | Weighted average remaining life |
|---|---|---|---|
| 5,000 | 0.10 | November 14, 2026 | 0.79 |
| 5,000 | 0.15 | November 14, 2026 | 0.79 |
| 223,214 | 1.39 | January 15, 2028 | 1.96 |
| 78,650 | 1.00 | April 26, 2028 | 2.24 |
| 58,600 | 0.34(1) | April 26, 2028 | 2.24 |
| 10,250 | 1.20 | June 22, 2028 | 2.39 |
| 26,500 | 0.34(1) | June 22, 2028 | 2.39 |
| 407,214 | 2.06 |
(1) Effective May 1, 2025, the Company repriced 1,422,100 common share purchase warrants to an exercise price of $0.34 per share. The repriced warrants originally had exercise prices of $1.00 per share and $1.20 per share, and expiry dates of April 26, 2028 and June 22, 2028, respectively.
Stock Options
The Company has adopted an equity incentive plan, which provides that the Board of Directors of the Company may from time to time, in its discretion, and in accordance with the Canadian Securities Exchange requirements, grant to directors, officers, employees, consultants and service providers, non-transferable stock options, share unit or deferred share unit (“DSU”) to purchase common shares, provided that the number of common shares reserved for issuance will not exceed 10% of the Company’s issued and outstanding common shares. Options will be exercisable for a period of up to a maximum of ten years from the date of grant. Share units and DSUs entitle the recipient participant to receive a cash payment equal to the market share value or allow the participant to acquire shares of the Company upon settlement.
In connection with the foregoing, the number of common shares reserved for issuance to any one optionee in any 12 month period will not exceed five percent (5%) of the issued and outstanding common shares, the number of common shares reserved for issuance to consultants in any 12 month period will not exceed two percent (2%) of the issued and outstanding common shares and the number of common shares reserved for issuance to all persons providing investor relations activities in any 12 month period will not exceed one percent (1%) of the issuance and outstanding common shares. As at January 31, 2026, the Company has 15,000 stock options, but no shares units and DSUs granted under the Omnibus Share Incentive Plan.
FINTECHWERX INTERNATIONAL SOFTWARE SERVICES INC.
Notes to the Condensed Interim Consolidated Financial Statements
For the Three and Nine Months Ended January 31, 2026
(Unaudited - Expressed in Canadian dollars)
8. Share Capital and Equity Reserves (continued)
Stock Options (continued)
A summary of the continuity of the Company's stock options for the nine months ended January 31, 2026 is as follows:
| Number of stock options | Weighted average exercise price $ | |
|---|---|---|
| Balance, April 30, 2025 | – | – |
| Granted | 80,000 | 0.55 |
| Exercised | (65,000) | 0.55 |
| Balance, January 31, 2026 | 15,000 | 0.55 |
| Exercisable, January 31, 2026 | – | – |
Stock options outstanding and exercisable at January 31, 2026 are as follows:
| Number of Stock options outstanding | Number of Stock options exercisable | Exercise price $ | Expiry date | Weighted average remaining life |
|---|---|---|---|---|
| 15,000 | – | 0.55 | June 16, 2027 | 1.37 |
Share-based compensation expense is determined using the Black-Scholes option pricing model. During the nine months ended January 31, 2026, the Company recognized share-based compensation expense of $29,026 (2025 – $nil) in equity reserves, of which $9,048 (2025 – $nil) pertains to a company controlled by a director of the Company. The weighted average fair value of stock options granted during the nine months ended January 31, 2026 was $0.40 (2025 – $nil) per option. Weighted average assumptions used in calculating the fair value of share-based compensation expense are as follows:
| January 31, 2026 | |
|---|---|
| Risk-free interest rate | 2.72% |
| Dividend yield | 0% |
| Expected volatility | 152% |
| Expected life (years) | 2.00 |
| Forfeiture rate | 0% |
As at January 31, 2026, there was $2,939 (2025 – $nil) of unrecognized share-based compensation related to the unvested stock options.
9. Segmented Information
For the nine months ended January 31, 2026 and 2025, the Company operated in a single operating segment and evaluates the performance of the business as a single segment. The Company's primary source of revenue is the sale of software EMT Plug-in that allows for automated reconciliation for electronic money transfer records and sublicense of its Gateway technology that allows merchants to accept payments from their customers through both physical point-of-sale terminals and online portals. All of the Company's sales are considered to occur in one demographic market, Canada.
FINTECHWERX INTERNATIONAL SOFTWARE SERVICES INC.
Notes to the Condensed Interim Consolidated Financial Statements
For the Three and Nine Months Ended January 31, 2026
(Unaudited - Expressed in Canadian dollars)
9. Segmented Information (continued)
The Company's gross revenue for the nine months ended January 31, 2026 and 2025 was $40,242 and $11,362, respectively. During the nine months ended January 31, 2026, 1% of revenues were derived from EMT Plug-in subscriptions, 70% of revenues related to the sublicense of the Gateway license and 29% of revenues related to consulting services. During the nine months ended January 31, 2025, 100% of revenues were derived primarily from EMT Plug-in subscriptions and a total of 66% of revenues represents the sale of EMT Plug-in subscriptions from one customer.
10. Capital Management
The Company's objective in managing capital is to ensure sufficient liquidity to fund research and development and engage in sales and marketing activities while at the same time taking a conservative approach toward financial leverage and management of financial risk. The Company's capital is composed entirely of equity. The Company uses capital to finance its operating losses. There is substantial uncertainty that the Company will be able to continue to finance its operating losses.
The Company currently funds these requirements from cash raised through the issuance of common shares. There is a risk that the Company will not be able to raise funds through the issuance of shares or on terms advantageous to the Company or its shareholders. The Company's objectives when managing capital are to ensure that the Company will have enough liquidity to continue to develop its software and services and engage in sales and marketing activities in order to obtain returns on investment.
The Company monitors its capital on the basis of the adequacy of its cash resources to fund its business plan. There is no external restriction on the Company's capital. The Company did not initiate any changes to its capital management strategy during the nine months ended January 31, 2026. The Company is not subject to externally imposed capital requirements.
11. Financial Instruments
The Company's financial instruments consist of cash and cash equivalents, trade and other receivables, accounts payable and accrued liabilities, loans payable, related party loan payable, and due to related parties and the carrying values approximate their fair values because of the relatively short-term nature of the instruments. These estimates are subjective and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumption could significantly affect the estimates.
There are three levels of the fair value hierarchy as follows:
- Level 1: Values based on unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities.
- Level 2: Values based on quoted prices in markets that are not active or model inputs that are observable either directly or indirectly for substantially the full term of the asset or liability.
- Level 3: Values based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement.
The Company is exposed in varying degrees to a variety of financial instrument-related risks. The Board of Directors approves and monitors the risk management process, inclusive of documented investment policies, counterparty limits, and controlling and reporting structures. The type of risk exposure and the way in which such exposure is managed is summarized as follows:
FINTECHWERX INTERNATIONAL SOFTWARE SERVICES INC.
Notes to the Condensed Interim Consolidated Financial Statements
For the Three and Nine Months Ended January 31, 2026
(Unaudited - Expressed in Canadian dollars)
11. Financial Instruments (continued)
Foreign exchange risk
The Company's functional and reporting currency is the Canadian dollar and major purchases are transacted in Canadian dollars. As a result, the Company's exposure to foreign currency risk is minimal.
Credit risk
The Company's cash and cash equivalents is held in large Canadian financial institutions. The Company has not experienced nor is exposed to any significant credit losses. Credit risk is the risk of loss associated with a counterparty's inability to fulfill its payment obligations. Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash, and trade and other receivables. The carrying amount of cash and cash equivalents, and trade and other receivables represent the maximum exposure to credit risk, and as at January 31, 2026, this amounted to $2,406,335 (April 30, 2025 - $109,125).
The Company's receivable consists of trade receivables and sales taxes receivable. Based on the valuation of receivables at January 31, 2026, the Company believes that its receivables are collectable, and management has determined that the credit risk is moderate.
Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Financial liabilities with fixed interest rates over a specified period of time expose the Company to cash flow interest rate risk. The Company does not hold any financial liabilities with variable interest rates. The Company does maintain bank accounts which earn interest at variable rates, but it does not believe it is currently subject to any significant interest rate risk.
Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company has a planning and budgeting process in place to help determine the funds required to support the Company's normal operating requirements on an ongoing basis. The Company aims to have sufficient funds to meet its short-term business requirements, taking into account its anticipated cash flows from its ability to raise equity capital or borrowing sufficient funds and its holdings of cash and cash equivalents.
Price risk
The ability of the Company to explore its new software technologies and the future profitability of the Company are directly related to the market price of software subscriptions. The Company monitors prices to determine the appropriate course of action to be taken by the Company.
12. Subsequent Events
On January 9, 2026, the Company entered into a non-binding letter of intent (the "LOI") with an arm's length third-party (the "Vendor") regarding the proposed acquisition of the Vendor's exclusive worldwide license to certain fraud-mitigation technology and an equity interest in the Vendor. As of the date of these financial statements, the definitive agreements have not been finalized.
FINTECHWERX INTERNATIONAL SOFTWARE SERVICES INC.
Notes to the Condensed Interim Consolidated Financial Statements
For the Three and Nine Months Ended January 31, 2026
(Unaudited - Expressed in Canadian dollars)
12. Subsequent Events (continued)
Subsequent to the nine months ended January 31, 2026, the Company issued a total of 10,000 common shares pursuant to the exercise of warrants with exercise prices ranging between $0.10 per share and $0.15 per share, of which $1,250 was recognized as subscriptions received at January 31, 2026.
Subsequent to the nine months ended January 31, 2026, the Company has completed an investment of US$50,000 in an arm's-length third party in connection with a commercial arrangement and related platform integration activities. The investment was made to support onboarding and transaction processing on the Company's platform.
Subsequent to the nine months ended January 31, 2026, the Company entered into a letter of intent ("LOI") with two arm's length third parties to collaborate in the formation of a Gibraltar-based payment institution, under which the Company intends to acquire a 20% equity interest subject to regulatory approval and execution of definitive agreements. The Company has agreed to provide initial funding toward formation and regulatory costs in connection with the proposed transaction. As of the date of these financial statement, the definitive agreements have not been finalized.