Smartset Services Inc. — Management Reports 2025

Jun 21, 2025

SMARTSET SERVICES INC.
(the “Company”)

FORM 51-102F1
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED
MARCH 31, 2025

The following Management’s Discussion and Analysis (“MD&A”), prepared as of June 20, 2025 should be read together with the financial statements for the year ended March 31, 2025 and the related notes attached thereto. Accordingly, the financial statements and MD&A include the results of the financial position, operations, and cash flows of the Company for the year ended March 31, 2025. The reader may also wish to refer to the Company’s audited financial statements and MD&A for the years ended March 31, 2023 and 2024 but the reader must be aware that historical results are not necessarily indicative of future performance. All amounts are reported in Canadian dollars. The aforementioned documents can be accessed on the SEDAR website at www.sedar.com.

Unless otherwise stated, financial results are being reported in accordance with International Financial Reporting Standards (“IFRS”).

MD&A contains the term cash flow from operations, which should not be considered an alternative to, or more meaningful than, cash flows from operating activities as determined in accordance with IFRS as an indicator of the Company’s performance. The Company’s determination of cash flow from operations may not be comparable to that reported by other companies. The reconciliation between profit or loss and cash flows from operating activities can be found in the statement of cash flows.

Certain statements contained in this MD&A may contain words such as "could", "should", "expect", "believe", "will" and similar expressions and statements relating to matters that are not historical facts but are forward-looking statements. Such forward-looking statements are subject to both known and unknown risks and uncertainties which may cause the actual results, performances, or achievements of the Company to be materially different from any future results, performances or achievements expressed or implied by such forward-looking statements. Such factors include, among other things, the receipt of required regulatory approvals, the availability of sufficient capital, the estimated cost and availability of funding for the continued exploration and development of the Company's prospects, political and economic conditions, commodity prices and other factors.

Description of Business

Smartset Services Inc. (the “Company”) was incorporated on May 9, 2013 pursuant to the provisions of the Business Corporations Act (Alberta) and was continued into British Columbia on February 2, 2018. The Company was formed to complete an Initial Public Offering (“IPO”) and became classified as a Capital Pool Company (“CPC”) as defined in the TSX Venture Exchange (“TSXV”) Policy 2.4. The Company will not carry on any business other than the identification and evaluation of assets or businesses with a view to completing a Qualifying Transaction (“QT”). The head office and the registered office of the Company is located at Suite 1500, Royal Centre, 1055 West Georgia Street, Vancouver, BC, V6E 4N7.

As a CPC, the Company’s principal business objective will be to identify and evaluate assets, properties, or businesses with a view to a potential acquisition or participation by completing a QT subject, in certain cases, to shareholders’ approval and acceptance by the TSXV. There is no assurance that the Company will identify and successfully acquire businesses or assets that will produce a profit. Moreover, if a potential business or asset is identified which warrants acquisition or participation, additional funds may be required to complete the acquisition or participation and the Company may not be able to obtain such financing on terms which are satisfactory to the Company.

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Smartset Services Inc.
Management’s Discussion & Analysis
March 31, 2025

Description of Business (continued)

Going Concern

These financial statements have been prepared on the 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 year ended March 31, 2025, the Company has not generated any revenues, and has negative cash flows from operations. As at March 31, 2025, the Company has an accumulated deficit of $929,430. The Company’s continuing operations are dependent upon its ability to identify, evaluate, and negotiate a QT. If the QT is identified or completed, additional funding may be required and there is no assurance that the Company will be able to obtain such financing, if any, on terms that are acceptable to the Company. These factors indicate the existence of a material uncertainty that may cast significant doubt on the ability of the Company to continue as a going concern. The financial statements do not include any adjustments to the recorded assets or liabilities that might be necessary should the Company be unable to continue as a going concern.

Liquidity & Capital Resources

Results of Operations for the year ended March 31, 2025

The Company had a net income of $66,512 for the year ended March 31, 2025 compared to a net income of $57,955 for the year ended March 31, 2024. During the year ended March 31, 2025, the Company recorded a recovery of previously impaired loan receivable balance of $95,000 (2024 - $155,000). Furthermore, the increase in the net income for the current year was also due to the reduction of professional fees of $27,275 from legal expenses, and share-based compensation of $29,005 as the Company did not grant any new stock options for the current year. The Company also recorded an increase in interest income from $5,823 in fiscal 2024 to $14,026 in fiscal 2025 as the Company placed more cash proceeds in cashable guaranteed investment certificates compared to prior year.

Off-balance Sheet Arrangements

The Company has not entered into any off-balance sheet arrangements.

Liquidity & Capital Resources

Cash Flows

During the year ended March 31, 2025, the Company received cash proceeds of $66,771 from operating activities compared to proceeds of $55,420 from operating activities during the year ended March 31, 2024. The proceeds from operating activities was due to the recovery of previously impaired loan receivable of $95,000 in fiscal 2025 and $155,000 in fiscal 2024.

Investing Activities

The Company did not have any investing activities during the year ended March 31, 2025 and 2024.

Financing Activities

During the year ended March 31, 2025, the Company did not have any financing activities compared to fiscal 2024, where the Company received $15,000 from the issuance of 300,000 common shares pursuant to a private placement less share issuance costs of $1,379.

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Smartset Services Inc.
Management's Discussion & Analysis
March 31, 2025

Performance Summary

Selected Annual Information

The following table provides a brief summary of the Company’s financial operations for the three most recently completed financial years ended March 31:

	2025	2024	2023
	$	$	$
Total revenue	–	–	–
Net income (loss) for the year	66,512	57,955	(480,519)
Basic and diluted earnings (loss) per share	0.00	0.00	(0.03)
Total assets	337,412	270,900	196,680
Total long-term liabilities	–	–	–

Summary of Quarterly Results

The following is a summary of the Company’s financial results for the eight most recently completed quarters:

	March 31, 2025	December 31, 2024	September 30, 2024	June 30, 2024
	$	$	$	$
Net income (loss) for the period	(5,950)	701	73,441	(1,680)
Basic and diluted earnings (loss) per share	(0.00)	0.00	0.00	0.00
	March 31, 2024	December 31, 2023	September 30, 2023	June 30, 2023
	$	$	$	$
Net gain (loss) for the period	(13,203)	59,974	29,813	(18,629)
Basic and diluted earnings (loss) per share	0.00	0.00	0.00	(0.00)

This information has been prepared in accordance with IFRS and is presented in Canadian dollars, which is the functional currency of the Company.

Financial Instruments and Risks

The Company is exposed in varying degrees to a variety of financial instruments and related risks. Those risks and management’s approach to mitigating those risks are as follows:

(a) Fair Values

The fair values of financial instruments, which include cash and cash equivalents, accrued interest receivable, and accounts payable and accrued liabilities, approximate their carrying values due to the relatively short-term maturity of these instruments.

Fair value measurements are classified using a fair value hierarchy that reflects the significance of inputs used in making the measurements. The fair value hierarchy has the following levels:

• Level 1 - valuation based on quoted prices (unadjusted) in active markets for identical assets or liabilities;
• Level 2 - valuation techniques based on inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and
• Level 3 - valuation techniques using inputs for the asset or liability that are not based on observable market data (unobservable inputs).

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Smartset Services Inc.
Management's Discussion & Analysis
March 31, 2025

Financial Instruments and Risks (continued)

(b) Credit Risk

Financial instruments that potentially subject the Company to a concentration of credit risk consists of cash and cash equivalents. The Company will limit its exposure to credit loss by placing its cash and cash equivalents with high credit quality financial institutions. The carrying amount of financial assets represents the maximum credit exposure.

(c) Foreign Exchange Rate Risk

Foreign exchange risk arises from future commercial transactions and recognized assets and liabilities denominated in a currency that is not the functional currency of the relevant company. The Company has no foreign exchange rate risk.

(d) Interest Rate Risk

Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The risk that the Company will realize such a loss is limited because the Company has no liabilities with variable rates.

(e) 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 plans on settling its financial obligations out of cash. The ability to do this relies on the Company raising debt and equity financing in a timely manner and by maintaining sufficient cash in excess of anticipated needs. There is no assurance that financing will be available or, if available, that such financing will be on terms acceptable to the Company.

Share Capital

Authorized: unlimited common shares

As at March 31, 2025 and the date of the audit report, there are 15,800,000 common shares issued and outstanding.

Stock Options

	Number of options	Weighted average Exercise price $
Outstanding, March 31, 2023	800,000	0.10
Granted	1,177,500	0.10
Cancelled	(397,500)	0.10
Outstanding, March 31, 2024 and 2025	1,580,000	0.10

As at the date of the audit report, there are 1,580,000 stock options issued and outstanding.

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Smartset Services Inc.
Management's Discussion & Analysis
March 31, 2025

Stock Options (continued)

Additional information regarding stock options outstanding as at March 31, 2025, is as follows:

Range of exercise prices $	Stock options outstanding	Weighted average remaining contracted life (years)
0.10	1,580,000	7.2

Capital Management

The Company manages its capital to maintain its ability to continue as a going concern and to provide returns to shareholders and benefits to other stakeholders. The capital structure of the Company consists of cash and cash equivalents and equity comprised of issued share capital and share-based payment reserve.

The Company manages its capital structure and makes adjustments to it in light of economic conditions. The Company and its Board of Directors will balance its overall capital structure through share issuances or by undertaking other activities as deemed appropriate under the specific circumstances. The Company is subject to externally imposed capital requirements under TSX-V Policy 2.4 for Capital Pool Companies and the Company’s overall strategy with respect to risk management remains unchanged from the year ended March 31, 2024.

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