VINYL GROUP LTD

ASX Release

PRELIMINARY FINAL REPORT 2024

Melbourne, Australia , 31 August 2024: Vinyl Group Ltd (ASX: VNL), Australia’s only ASX-listed music Company, is today pleased to release its preliminary final report and appendix 4E for the year ending 30 June 2024.

The financial year ended 30 June 2024 was focused on accelerating revenue growth and establishing a presence in new markets. These commercial efforts, which, for the purpose of this preliminary report, are summarised as follows:

Revenue growth of 754% to $4.971M in FY24
Acquisition and integration of The Brag Media, increasing the breadth of services provided
Reduction of principal amount of convertible debt from $4.817M to $1.371M

The Company spent considerable time and resources integrating The Brag Media, with an eye on the future, including a renewed focus on content development, which has already seen a positive impact on our audience numbers. The synergies unlocked through the integration of our systems and people, will provide a robust infrastructure for a seamless integration of Mediaweek post completion of that acquisition. This groundwork also lays the foundation for positive cash flows from The Brag Media FY25.

The recent Entitlements Offer was focused on growth investment aimed at accelerating the other business lines, like Vinyl.com and Vampr. We are seeing early dividends in this investment as we look to considerably grow these parts of the business heading into the holiday season and beyond. We also have an R&D project, well underway, to modernise and reduce the operating costs of the Jaxsta platform whilst bringing a new customer experience.

Our cost structure will start to realise cost savings in the first half of the year as we also focus on increased revenues to bring us close to our profitable state target.

Results

We have record revenues with, but our overall operating results were lower compared to FY23 as part of the growth strategy transition outlined above and mostly due to the following:

fair value loss on the conversion of convertible notes, stemming from our increased share price during FY24 at the time of conversion;
costs for acquiring and integrating The Brag Media, including cost review and cleanup of accrued costs;
increased marketing and consultant costs;
amortisation of intangibles assets from acquisitions;
increase in employee costs from a larger team and redundancy costs paid during the year.

Vinyl Group Ltd | 11 Wilson Street, South Yarra VIC 3141 | ABN 15 106 513 580 | ASX: VNL

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A large portion of the loss came from non-cash expenses, approximately $11.0M of the total, with the balance being cash based losses of $6.0M.

The Company finished the financial year with $4.1M in cash reserves, but also a significant $1.9M in trade and other receivables.

The Company will be providing a comprehensive investor update on the annual results and state of business following the upcoming release of the Annual Report to the market. Registration details to be made available on the Vinyl Group investor portal prior.

Authorisation and Additional Information:

This announcement was authorised by the Board of Vinyl Group Ltd

Vinyl Group Investor Relations: E: [email protected]

-Ends-

ABOUT VINYL GROUP

Vinyl Group is the heartbeat of an equitable music world, providing tech solutions that connect and give credit to the creator economy. The Company’s diverse portfolio has touchpoints across all corners of the global music ecosystem, empowering everyone from creators to consumers. Vinyl.com offers a world-class ecommerce experience including over 50K titles for fans to support their favourite artists. Vampr is a leading dedicated social-professional networking platform and talent marketplace, allowing 1.4M creators to discover collaborators and monetise their work in over 180 countries. Jaxsta is the world’s largest and only database of official music credits with over 380M verified credits to streamline revenue opportunities for businesses in the music industry. The Brag Media is Australia’s largest creator of premium youth content and events and publishes iconic titles including Rolling Stone AU/NZ, Variety Australia, TheBrag.com, The Music Network, Tone Deaf, and more.

Vinyl Group Ltd | 11 Wilson Street, South Yarra VIC 3141 | ABN 15 106 513 580 | ASX: VNL

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Appendix 4E Preliminary final report

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1. Company details

Name of entity: Vinyl Group Ltd ABN: 15 106 513 580 Reporting period: For the year ended 30 June 2024 Previous period: For the year ended 30 June 2023

2. Results for announcement to the market

2. Results for announcement to the market
				$
Revenues from ordinary activities	up	753.7%	to	4,970,575
Other income and interest revenue	down	57.0%	to	332,684
Loss from ordinary activities after tax attributable to the owners of Vinyl Group Ltd	up	58.1%	to	(17,058,244)
Loss for the year attributable to the owners of Vinyl Group Ltd	up	58.1%	to	(17,058,244)

Dividends

There were no dividends paid, recommended or declared during the current financial period.

Comments

The loss for the Group after providing for income tax amounted to $17,058,244 (30 June 2023: $10,792,141).

Refer to Market announcement, which precedes the Appendix 4E, for further commentary on the results for the year ended 30 June 2024.

3. Net tangible assets

Net tangible assets per ordinary security	Reporting period Cents	Previous period Cents (1.38)
	(0.47)

4. Control gained over entities Name of entities (or group of entities) Seventh Street Entertainment Pty Ltd, Seventh Street Media Pty Ltd and The Brag Publishing Pty Ltd collectively ('The Brag Media') Date control gained 1 February 2024

Refer to note 10 'Business combinations' for details.

5. Loss of control over entities

Not applicable.

(DRAFT 1)

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Appendix 4E Preliminary final report

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6. Dividends

Current period

There were no dividends paid, recommended or declared during the current financial period.

Previous period

There were no dividends paid, recommended or declared during the previous financial period.

7. Dividend reinvestment plans

Not applicable.

8. Details of associates and joint venture entities

Not applicable.

9. Foreign entities

Details of origin of accounting standards used in compiling the report:

Not applicable.

10. Audit qualification or review

Details of audit/review dispute or qualification (if any):

The financial statements are in the process of being audited and an unqualified opinion is expected to be issued. The auditor's report will contain a paragraph addressing material uncertainty related to going concern.

11. Attachments

Details of attachments (if any):

The Unaudited Preliminary Financial Report of Vinyl Group Ltd for the year ended 30 June 2024 is attached.

12. Signed

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Signed _________

Date: 30 August 2024

Linda Jenkinson Non-Executive Director and Chair Melbourne

(DRAFT 1)

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(Formerly known as Jaxsta Limited)

ABN 15 106 513 580

Unaudited Preliminary Financial Report - 30 June 2024

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Contents 30 June 2024

Statement of profit or loss and other comprehensive income 2 Statement of financial position 3 Statement of changes in equity 4 Statement of cash flows 5 Notes to the financial statements 6

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1 (DRAFT 1)

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Statement of profit or loss and other comprehensive income For the year ended 30 June 2024

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Note Revenue 2 Other income 3 Interest income calculated using the effective interest method Expenses Raw materials and consumables used 4 Employee benefits expense 4 Product development expense 4 Depreciation and amortisation expense 4 Impairment of receivables Write-off of assets 4 Professional fees Marketing expense Occupancy expense Fair value loss on financial liabilities 8 Other expenses 4 Finance costs 4 Loss before income tax expense Income tax expense Loss after income tax expense for the year attributable to the owners of Vinyl Group Ltd Other comprehensive income Items that may be reclassified subsequently to profit or loss Foreign currency translation Other comprehensive income for the year, net of tax Total comprehensive income for the year attributable to the owners of Vinyl Group Ltd Basic earnings per share 11 Diluted earnings per share 11	Consolidated 2024 2023 $ $ 4,970,575 582,209 302,276 762,024 30,408 12,561 (3,246,567) (40,580) (3,742,389) (3,081,318) (1,111,881) (844,370) (499,214) (72,107) (11,438) - - (68,016) (1,688,360) (544,997) (724,848) (177,502) (144,377) (7,761) (9,917,397) (5,824,515) (1,012,773) (393,456) (262,259) (1,094,313) (17,058,244) (10,792,141) - - (17,058,244) (10,792,141) 37,893 (3,660) 37,893 (3,660) (17,020,351) (10,795,801) Cents Cents (2.54) (3.02) (1.91) (3.02)
	4,970,575

	302,276
	30,408


	(3,246,567)
	(3,742,389)
	(1,111,881)
	(499,214)
	(11,438)
	-
	(1,688,360)
	(724,848)
	(144,377)
	(9,917,397)
	(1,012,773)
	(262,259)

	(17,058,244)

	-


	(17,058,244)




	37,893

	37,893


	(17,020,351)

	Cents
	(2.54)
	(1.91)

The above statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes 2 (DRAFT 1)

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Statement of financial position As at 30 June 2024

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Note Assets Current assets Cash and cash equivalents Trade and other receivables 5 Other assets Total current assets Non-current assets Property, plant and equipment Intangibles 6 Total non-current assets Total assets Liabilities Current liabilities Trade and other payables 7 Contract liabilities Borrowings and derivative financial instruments 8 Employee benefits Total current liabilities Non-current liabilities Contract liabilities Borrowings and derivative financial instruments 8 Employee benefits Total non-current liabilities Total liabilities Net (liabilities)/assets Equity Issued capital 9 Reserves Accumulated losses Total (deficiency)/equity	Consolidated 2024 2023 $ $ 4,132,383 2,966,748 1,923,938 919,551 136,643 29,205	Consolidated 2024 2023 $ $ 4,132,383 2,966,748 1,923,938 919,551 136,643 29,205



	4,132,383
	1,923,938
	136,643
	6,192,964	3,915,504
		18,329 5,761,390

	1,271
	12,972,699
	12,973,970	5,779,719
		9,695,223
	19,166,934
		868,357 40,332 4,547,882 120,515



	2,883,109
	91,486
	7,159,743
	198,572
	10,332,910	5,577,086
		431,239 5,055,960 29,107

	357,643
	-
	53,794
	411,437	5,516,306
		11,093,392
	10,744,347
		(1,398,169)
	8,422,587
		46,873,583 5,353,179 (53,624,931)

	73,368,750
	5,737,012
	(70,683,175)
		(1,398,169)
	8,422,587

The above statement of financial position should be read in conjunction with the accompanying notes

3 (DRAFT 1)

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Statement of changes in equity For the year ended 30 June 2024

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Issued capital $ 38,620,271 - -	Reserves $ 4,806,801 - (3,660)	Accumulated losses $ (42,832,790) (10,792,141) -
- 8,253,312 -	(3,660) - 550,038	(10,792,141) - -
46,873,583	5,353,179	(53,624,931)
Issued capital $	Reserves $	Accumulated losses $
46,873,583	5,353,179	(53,624,931)

-	-	(17,058,244)
-	37,893	-

-	37,893	(17,058,244)


26,495,167	-	-
-	345,940	-

73,368,750	5,737,012	(70,683,175)

The above statement of changes in equity should be read in conjunction with the accompanying notes

4 (DRAFT 1)

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Statement of cash flows For the year ended 30 June 2024

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Note Cash flows from operating activities Receipts from customers (inclusive of GST) Payments to suppliers and employees (inclusive of GST) Receipts from grants - research and development (inclusive of GST) Receipts from grants - export development (inclusive of GST) Interest received Interest and other finance costs paid Net cash used in operating activities Cash flows from investing activities Cash acquired/(utilised) on purchase of business 10 Payments for equipment Payments for intangibles 6 Net cash from investing activities Cash flows from financing activities Proceeds from issue of shares 9 Share issue transaction costs Repayment of borrowings Repayment of lease liabilities Net cash from financing activities Net decrease in cash and cash equivalents Cash and cash equivalents at the beginning of the financial year Cash and cash equivalents at the end of the financial year	Consolidated 2024 2023 $ $ 5,039,900 298,914 (10,288,313) (4,559,336) 700,109 1,040,906 - 32,574 (4,548,304) (3,186,942) 27,465 11,464 - - (4,520,839) (3,175,478) (7,879,790) 31,657 (945) - - (1,028) (7,880,735) 30,629 13,822,495 3,372,950 (5,500) (187,965) (249,786) (113,887) - (83,436) 13,567,209 2,987,662 1,165,635 (157,187) 2,966,748 3,123,935 4,132,383 2,966,748

	5,039,900
	(10,288,313)
	700,109
	-

	(4,548,304)
	27,465
	-

	(4,520,839)


	(7,879,790)
	(945)
	-

	(7,880,735)


	13,822,495
	(5,500)
	(249,786)
	-

	13,567,209

	1,165,635
	2,966,748

	4,132,383

The above statement of cash flows should be read in conjunction with the accompanying notes 5 (DRAFT 1)

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Notes to the financial statements 30 June 2024

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Note 1. Operating segments

Identification of reportable operating segments

Operating segments are presented using the 'management approach', where the information presented is on the same basis as the internal reports provided to the Chief Operating Decision Makers ('CODM'). The CODM is responsible for the allocation of resources to operating segments and assessing their performance.

Management identifies one operating segment based on the Group’s service lines, therefore the operating segment information is as disclosed throughout these financial statements.

The Group’s segment operating loss reconciles to the Group’s loss before tax as presented in its financial statements.

The information reported to the CODM is on a monthly basis.

Major customers

There are 5 major customers (2023: 5) that account for more than 5% of the Group’s revenues for a total of 42.35% (2023: 70.3%) of the Group's revenue. The total amount of revenues from these customers was $734,250, $358,760, $352,006, $333,078 and $326,702 (2023: $174,248, $84,174, $68,730, $44,736 and $37,709).

Geographical information

Sales to external customers Geographical non-current assets 2024 2023 2024 2023 $ $ $ $ 3,367,664 13,336 12,973,970 5,779,719 1,505,067 422,795 - - 74,493 144,997 - - 22,497 1,081 - - 4,969,721 582,209 12,973,970 5,779,719	Sales to external customers Geographical non-current assets 2024 2023 2024 2023 $ $ $ $ 3,367,664 13,336 12,973,970 5,779,719 1,505,067 422,795 - - 74,493 144,997 - - 22,497 1,081 - - 4,969,721 582,209 12,973,970 5,779,719	Sales to external customers Geographical non-current assets 2024 2023 2024 2023 $ $ $ $ 3,367,664 13,336 12,973,970 5,779,719 1,505,067 422,795 - - 74,493 144,997 - - 22,497 1,081 - - 4,969,721 582,209 12,973,970 5,779,719	Sales to external customers Geographical non-current assets 2024 2023 2024 2023 $ $ $ $ 3,367,664 13,336 12,973,970 5,779,719 1,505,067 422,795 - - 74,493 144,997 - - 22,497 1,081 - - 4,969,721 582,209 12,973,970 5,779,719
3,367,664		12,973,970
1,505,067		-
74,493		-
22,497		-
	582,209		5,779,719
4,969,721		12,973,970

The geographical non-current assets above are exclusive of, where applicable, financial instruments, deferred tax assets, post-employment benefits assets and rights under insurance contracts.

Note 2. Revenue

Revenue from contracts with customers Sales Other revenue Other revenue Revenue	Consolidated 2024 2023 $ $ 4,969,721 582,209	Consolidated 2024 2023 $ $ 4,969,721 582,209

	4,969,721
		-

	854
		582,209
	4,970,575

6 (DRAFT 1)

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Notes to the financial statements 30 June 2024

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Note 2. Revenue (continued)

Disaggregation of revenue

The disaggregation of revenue from contracts with customers is as follows:

Major product lines Media & events Subscription revenue * Data solutions revenue Retail Timing of revenue recognition Goods transferred at a point in time Services transferred over time	Consolidated 2024 2023 $ $ 3,132,036 - 611,344 388,068 195,219 154,560 1,031,122 39,581	Consolidated 2024 2023 $ $ 3,132,036 - 611,344 388,068 195,219 154,560 1,031,122 39,581

	3,132,036
	611,344
	195,219
	1,031,122
		582,209
	4,969,721
		39,581 542,628

	1,031,122
	3,938,599
		582,209
	4,969,721

The disaggregation of revenue by geographical regions is presented in note 1 'Operating segments'.

Note 3. Other income

Export market development grant Research and development tax incentive * Sundry income Other income	Consolidated 2024 2023 $ $ 36,600 36,600 265,676 721,386 - 4,038	Consolidated 2024 2023 $ $ 36,600 36,600 265,676 721,386 - 4,038
	36,600
	265,676
	-
		762,024
	302,276

For the research and development incentive receivable as at reporting date refer to note 5.

Note 4. Expenses

Loss before income tax includes the following specific expenses: Cost of sales Depreciation Computer equipment Office equipment Buildings right-of-use assets Total depreciation	Consolidated 2024 2023 $ $ 3,246,567 40,580	Consolidated 2024 2023 $ $ 3,246,567 40,580


	3,246,567
		5,698 7,239 49,075

	9,589
	2,853
	-
		62,012
	12,442

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7 (DRAFT 1)

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Notes to the financial statements 30 June 2024

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Note 4. Expenses (continued)

Amortisation Platform development Trademarks Customer relationships Total amortisation Total depreciation and amortisation Write-off of assets Right-of-use assets - buildings Trademarks (note 6) Total write-off Employee benefits expense Salary and wages Share-based payments expense Defined contribution superannuation expense Total employee benefits expense Product development expense Product development cash expenses Product development equity-based payments Total product development expense Other expenses including the following material expenses: Insurance Accounting and audit fees Filing fees Subscriptions Other Other expenses Finance costs Interest and finance charges paid/payable on borrowings Net foreign exchange loss Net foreign exchange loss Net loss on disposal Net loss on disposal of property, plant and equipment	Consolidated 2024 2023 $ $ 400,003 - 8,769 10,095 78,000 - 486,772 10,095 499,214 72,107 - (11,897) - (56,119) - (68,016) 3,127,054 2,313,126 345,940 550,038 269,395 218,154 3,742,389 3,081,318 1,078,619 843,788 33,262 582 1,111,881 844,370 132,487 103,485 397,103 140,756 211,851 94,139 90,978 2,745 180,354 52,331 1,012,773 393,456 262,259 1,094,313 36,791 7,222 4,616 5,847

	400,003
	8,769
	78,000

	486,772

	499,214


	-
	-

	-


	3,127,054
	345,940
	269,395

	3,742,389


	1,078,619
	33,262

	1,111,881


	132,487
	397,103
	211,851
	90,978
	180,354

	1,012,773


	262,259


	36,791


	4,616

8 (DRAFT 1)

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Notes to the financial statements 30 June 2024

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Note 5. Trade and other receivables

Current assets Trade receivables Research and development incentive receivable Other receivables GST receivable	Consolidated 2024 2023 $ $ 1,575,630 167,963 165,587 651,764 71,582 52,525 111,139 47,299 1,923,938 919,551

	1,575,630
	165,587
	71,582
	111,139

	1,923,938

Note 6. Intangibles

Non-current assets Goodwill - at cost Platform development - at cost Less: Accumulated amortisation Trademarks - at cost Less: Accumulated amortisation Less: Impairment Brand - at cost Customer relationships - at cost Less: Accumulated amortisation	Consolidated 2024 2023 $ $ 10,404,499 5,639,418 1,778,963 178,963 (578,966) (178,963) 1,199,997 - 256,538 256,538 (70,965) (62,196) (72,370) (72,370) 113,203 121,972 1,189,000 - 144,000 - (78,000) - 66,000 - 12,972,699 5,761,390

	10,404,499

	1,778,963
	(578,966)
	1,199,997

	256,538
	(70,965)
	(72,370)
	113,203

	1,189,000

	144,000
	(78,000)
	66,000

	12,972,699

9 (DRAFT 1)

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Notes to the financial statements 30 June 2024

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Note 6. Intangibles (continued)

Reconciliations

Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out below:

Consolidated Balance at 1 July 2022 Additions Additions through business combinations (note 10) Write-off of assets (note 4) Amortisation expense Balance at 30 June 2023 Additions Additions through business combinations (note 10) Reallocation of intangibles on finalisation of business acquisition Exchange differences Amortisation expense Balance at 30 June 2024	Goodwill $ - - 5,639,418 - - 5,639,418 - 7,698,081 (2,933,000) - - 10,404,499	Platform developmen t $ - - - - - - - - 1,600,000 - (400,003) 1,199,997	Trademarks $ 187,158 1,028 - (56,119) (10,095) 121,972 - - - - (8,769) 113,203	Customer relationships $ - - - - - - - - 144,000 - (78,000) 66,000	Brand $ - - - - - - - - 1,189,000 - - 1,189,000	Total $ 187,158 1,028 5,639,418 (56,119) (10,095) 5,761,390 - 7,698,081 - - (486,772) 12,972,699

Note 7. Trade and other payables

Current liabilities Trade payables Sales tax payable Other payables	Consolidated 2024 2023 $ $ 1,113,218 297,857 58,203 1,800 1,711,688 568,700	Consolidated 2024 2023 $ $ 1,113,218 297,857 58,203 1,800 1,711,688 568,700

	1,113,218
	58,203
	1,711,688
		868,357
	2,883,109

10 (DRAFT 1)

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Notes to the financial statements 30 June 2024

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Note 8. Borrowings and derivative financial instruments

Current liabilities Insurance financing Convertible notes payable - tranche 1 (i), (iii) Derivative financial liability (i) Non-current liabilities Convertible notes payable - tranche 2 (ii) Derivative financial liabilities - tranche 2 (ii)	Consolidated 2024 2023 $ $ 52,304 134,542 59,017 1,967,237 7,048,422 2,446,103	Consolidated 2024 2023 $ $ 52,304 134,542 59,017 1,967,237 7,048,422 2,446,103

	52,304
	59,017
	7,048,422
		4,547,882
	7,159,743
		3,349 5,052,611

	-
	-
		5,055,960
	-

Insurance financing

Insurance funding is a ten months short term loan with a fixed interest rate of 6.75% (2023: 6.98%).

Convertible notes payable

On 10 September 2020, the Company entered into a convertible note agreement with Songtradr Inc. for a principal value of $1,420,000 (tranche 1). Conversion would result in the issue of 40,571,429 fully paid ordinary Vinyl Group shares at a price of $0.035 per share for the principal value of the note. The conversion is at the right of the noteholder, except if:

the Company registers a full year net profit of $5,000,000 at which time 100% of the note is converted automatically; or
the Company registers a full year net profit of $2,500,000 at which time 50% of the note is converted automatically.

On 24 June 2022, the shareholders authorised the Company to enter into an additional tranche of the prior convertible note agreement with Songtradr Inc. for a principal value of $3,000,000. Conversion would result in the issue of 142,857,143 fully paid ordinary Vinyl Group shares at a price of $0.021 per share for the principal value of the note. All the conditions of the original convertible note remain and in addition the Company agreed to appoint two directors proposed by Songtradr and enter into a cost reduction and growth plan agreed to by Songtradr. The Company completed those requirements by the completion of the shareholder approval. Additionally, as a consequence of the variation of the note, the original note of $1,420,000 would change the conversion price from $0.035 to $0.021, resulting in the potential issue of a further 27,047,619 ordinary shares.

On 13 September 2023, the Group converted tranche 1 of the Songtradr convertible note into ordinary shares, reducing $1,774,597 in principal and interest at the conversion price of $0.021, resulting in the issue of 84,504,631 ordinary shares. The Group recognised the issue of ordinary shares at the value of $3,828,882 being the carrying value of the convertible note as of the date of conversion.

The noteholder at their option can convert or seek repayment of the note at the expiration of the term of the note. The note has an anti-dilution clause that adjusts the conversion price if certain circumstances occur before the final redemption date. The note has a term of up to 3 years and carries a coupon rate of 7.5% which will be accrued and paid at the end of the term or capitalised and converted at the time of conversion or repayment. The note is secured by a first ranking security over the assets of the Company and its subsidiaries.

The second tranche also includes a separate option to invest a further $3,000,000 under an option agreement with an exercise price of $0.021 per share. The option has a life of 3 years and can only be exercised if Tranche 2 is partially or fully converted and up to the amount of Tranche 2 converted into shares.

11 (DRAFT 1)

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Notes to the financial statements 30 June 2024

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Note 8. Borrowings and derivative financial instruments (continued)

(i) Tranche 1 - Under the requirements of AASB 9 Financial Instruments the change in terms of the notes require derecognition of the original note and recognition of the new note, with the difference recognised in the profit or loss. The note is considered a hybrid financial instrument that contains a financial liability host and an embedded derivative based on the fair value of the conversion option that are not closely related. The financial liability host and the embedded derivative components have therefore been bifurcated and valued separately. Tranche 1 was converted to ordinary shares on 13 September 2023.
(ii) Tranche 2 - The note is considered a hybrid financial instrument that contains a financial liability host and an embedded derivative based on the fair value of the conversion option that are not closely related. The financial liability host and the embedded derivative components have therefore been bifurcated and valued separately.

As of 30 June 2024, the tranche 2 host liability is recorded at $59,017 (2023: $3,349) and the derivative liability has been measured at $7,048,422 (2023: $5,052,611), after recording a fair value loss of $9,917,398 and an interest expense of $231,596.

(iii) On 1 June 2023, the Company entered into a one year convertible note agreement with one of the vendors of Vampr, as part of the transaction for a principal amount of US$258,000. The noteholder has the right to convert the note at a conversion price of A$0.05. The note carries a 10% interest rate. The note is considered a single combined instrument at FVTPL. The noteholder elected to convert the note on 29 December 2023 into ordinary shares, resulting in the carrying value of the liability, $413,459 being converted to equity and resulting in the issue of 8,269,185 ordinary shares.

The total fair value loss on re-measurement of the derivative liability components as at 30 June 2024 was $1,916,537 (2023: loss of $5,824,515).

12 (DRAFT 1)

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Notes to the financial statements 30 June 2024

==> picture [83 x 34] intentionally omitted <==

Note 9. Issued capital

2024 Shares	Consolidated 2023 2024 Shares $ 517,644,429 66,848,966	Consolidated 2023 2024 Shares $ 517,644,429 66,848,966	2023 $ 46,873,583
968,658,522		66,848,966
	Shares 342,578,199 12,431,754 150,000 88,734,476 73,750,000 - -	Issue price $0.030 $0.000 $0.057 $0.040 $0.000 $0.000	$ 38,620,271 372,950 - 5,057,865 2,950,000 50,000 (177,503)
	517,644,429		46,873,583
		$0.021	3,870,789
	84,504,631
	1,250,000	$0.040	-
		$0.050	413,459
	8,269,185
	90,240,674	$0.044	4,044,587
	2,500,000		-
		$0.044	6,955,413
	155,185,475
	1,752,647		116,400
	-		97,500
		$0.021	8,271,693
	77,588,162
	500,000	$0.035	17,500
	28,473,319	$0.098	2,790,385
	750,000	$0.035	26,250
			(108,809)

	968,658,522		73,368,750

The funds were received in June 2023, but the shares were not issued until 29 November 2023 after approval by shareholders was obtained at the Annual General Meeting (AGM) of shareholders.

Ordinary shares

Ordinary shares entitle the holder to participate in dividends and any proceeds attributable to shareholders should the Company be wound up, in proportions that consider both the number of shares held and the extent to which those shares are paid up. The fully paid ordinary shares have no par value and the Company does not have a limited amount of authorised capital.

On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote.

13 (DRAFT 1)

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Notes to the financial statements 30 June 2024

==> picture [83 x 34] intentionally omitted <==

Note 10. Business combinations

Acquisition of Seventh Street Entertainment Pty Ltd, Seventh Street Media Pty Ltd and The Brag Publishing Pty Ltd collectively ('The Brag Media')

On 1 February 2024, the Company acquired 100% of the ordinary shares of The Brag Media and its subsidiaries for the total consideration transferred of $7,865,085. The Brag Media is the Australia's largest youth publisher [leading music industry social network connecting musicians, creatives and artists so they can collaborate, create new music and monetise their work]. This acquisition immediately increased Vinyl Group's footprint in the creator community. The goodwill of $4,765,081 represents revenues synergies from cross selling opportunities in the respective customer based as well as revenue growth and margin expansion]. The acquired business contributed revenues of $3,367,664 and a loss after tax of $1,445,558 to the Group for the period from 1 February 2024 to 30 June 2024. If the acquisition occurred on 1 July 2023, the full year contributions would have been revenues of $7,809,227 and profit/loss after tax of $3,761,684. The values identified in relation to the acquisition of The Brag Media are provisional as at 30 June 2024 until all intangibles asset values are individually assigned.

Details of the acquisition are as follows:

Cash and cash equivalents Trade and other receivables Other current assets Trade and other payables Deferred tax liability Other provisions Net assets acquired Goodwill Acquisition-date fair value of the total consideration transferred Representing: Cash paid or payable to vendor Contingent consideration Convertible notes Acquisition costs expensed to profit or loss Cash used to acquire business, net of cash acquired: Acquisition-date fair value of the total consideration transferred Less: cash and cash equivalents Less: contingent consideration Net cash used	Fair value $ 28,931 1,500,293 64,255 (1,426,475) - -
	167,004 7,698,081
	7,865,085
	7,865,085 - -
	7,865,085
	-
	7,865,085 (28,931) -
	7,836,154

As part of the completion, the Company has:

14 (DRAFT 1)

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Notes to the financial statements 30 June 2024

==> picture [83 x 34] intentionally omitted <==

Note 10. Business combinations (continued)

Paid $7.865 million cash to the sellers of The Brag Media (the “Initial Consideration”). The Initial Consideration covers value paid for the shares and the paydown of loans by the sellers to The Brag Media and its subsidiaries.
An agreement to pay The Brag Media sellers up to a further $2 million in cash or stock at Vinyl Group's discretion (the “contingent consideration”). The contingent consideration payment will accrue 6% annual interest if paid in cash and is contingent on The Brag Media and its subsidiaries achieving specified revenue and EBIT targets for the Calendar Year 2024. The contingent consideration will be based on a sliding scale that commences after The Brag Media achieves both a minimum revenue of $12.0 million and a minimum EBITDA of $2.0 million up to a maximum of $15.5 million in revenue and EBITDA of $2.8 million.
Issued 5,000,000 unlisted options to The Brag Media MD and Publisher Luke Girgis vesting in two equal tranches. The first tranche vests upon achieving the calendar year 2024 revenue target of $12.0 million and EBIT target of $2.8 million and a minimum of one year of employment post-sale. These options were cancelled in June 2024 as Mr Girgis is no longer employed with the Group.

Note 11. Earnings per share

Loss after income tax attributable to the owners of Vinyl Group Ltd Weighted average number of ordinary shares used in calculating basic earnings per share Weighted average number of ordinary shares used in calculating diluted earnings per share Basic earnings per share Diluted earnings per share	Consolidated 2024 2023 $ $ (17,058,244) (10,792,141) Number Number 670,448,401 356,920,578 891,647,767 356,920,578 Cents Cents (2.49) (3.02) (1.88) (3.02)
	(17,058,244)
	Number
	670,448,401

	891,647,767
	Cents
	(2.49)
	(1.88)

98,413,981 options over ordinary shares are not included in the calculation of diluted earnings per share because they are anti-dilutive. These options could potentially dilute basic earnings per share in the future.

15 (DRAFT 1)

AI assistant

VINYL GROUP LTD — Annual Report 2024

66014_rns_2024-08-29_f3cae991-c725-4f75-be5f-6691fe4599d3.pdf

ASX Release

PRELIMINARY FINAL REPORT 2024

Results

Authorisation and Additional Information:

-Ends-

ABOUT VINYL GROUP

1. Company details

2. Results for announcement to the market

Dividends

Comments

3. Net tangible assets

5. Loss of control over entities

6. Dividends

Current period

Previous period

7. Dividend reinvestment plans

8. Details of associates and joint venture entities

9. Foreign entities

Details of origin of accounting standards used in compiling the report:

10. Audit qualification or review

Details of audit/review dispute or qualification (if any):

11. Attachments

Details of attachments (if any):

12. Signed

Vinyl Group Ltd

ABN 15 106 513 580

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Statement of profit or loss and other comprehensive income For the year ended 30 June 2024

Vinyl Group Ltd (Formerly known as Jaxsta Limited) Statement of changes in equity For the year ended 30 June 2024

Note 1. Operating segments

Identification of reportable operating segments

Major customers

Geographical information

Note 2. Revenue

Note 2. Revenue (continued)

Disaggregation of revenue

Note 3. Other income

Note 4. Expenses

Note 4. Expenses (continued)

Note 5. Trade and other receivables

Note 6. Intangibles

Note 6. Intangibles (continued)

Reconciliations

Note 7. Trade and other payables

Note 8. Borrowings and derivative financial instruments

Insurance financing

Convertible notes payable

Note 8. Borrowings and derivative financial instruments (continued)

Note 9. Issued capital

Ordinary shares

Note 10. Business combinations

Acquisition of Seventh Street Entertainment Pty Ltd, Seventh Street Media Pty Ltd and The Brag Publishing Pty Ltd collectively ('The Brag Media')

Note 10. Business combinations (continued)

Note 11. Earnings per share

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VINYL GROUP LTD Annual Report 2024