Final Results

Fragrant Prosperity Holdings Limited ("FPP" or the "Company") is pleased to announce an extract from its audited results for the year ended 31 March 2025. The full unedited version of the audited annual results will be available shortly on the national storage mechanism at the following website: https://data.fca.org.uk/#/nsm/nationalstoragemechanism

Chairmans Statement

The Board continued to review a number of potential acquisition opportunities across the sector but none of which met the necessary criteria for selection as at the end of the year. It is expected that with the potential improvement in the market conditions for raising capital and undertaking reverse takeovers in the UK along with the changes to the UK listing regime recently announced by the FCA that the Company will have improved prospects for identifying a potential target. The last 3 years have been difficult across the public capital markets globally, but specifically the UK and with limited cash available it has been challenging to consummate potential deals. The Company has therefore undertaken a recapitalisation of the balance sheet and a capital raise post period end to improve the position for undertaking any potential acquisitions.

During the financial year, the Company reported a net loss of £182,934 (2024: £111,877) which represents ongoing administrative expenses and due diligence costs regarding the identification of potential targets. As at 31 March 2025, the Company had cash in bank balance of £67,879 (2024: £109,688).

The Board will provide further updates to shareholders in due course.

Chairman

Enquires:

Optiva Securities Ltd (Financial Adviser)

The notes to the financial statements form an integral part of these financial statements.

The notes to the financial statements form an integral part of these financial statements.

This report was approved by the board and authorised for issue on and signed on its behalf by;

…………………

Simon Retter

Director

The notes to the financial statements form an integral part of these financial statements.

STATEMENT OF CHANGES IN EQUITY

FOR THE FINANCIAL YEAR ENDED 31 MARCH 2025

The notes to the financial statements form an integral part of these financial statements.

GENERAL INFORMATION

The Company's nature of operations is to act as a special purpose acquisition company.

ACCOUNTING POLICIES

Basis of preparation

The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the United Kingdom and IFRIC interpretations applicable to companies reporting under IFRS. The financial statements have been prepared under the historical cost convention as modified for financial assets carried at fair value.

The financial information of the Company is presented in British Pound Sterling ("£") which is the Company's functional and presentational currency.

Standards and interpretations issued but not yet applied

At the date of authorisation of this financial information, the Directors have reviewed the Standards in issue by the International Accounting Standards Board ("IASB") and IFRIC, which are effective for accounting periods beginning on or after the stated effective date. In their view, none of these standards would have a material impact on the financial reporting of the Company.

Going concern

In the year ended 31 March 2025 the Company recorded a loss after tax of £182,934 (2024: £111,877 ) and a net cash outflow from operating activities of £41,809 (2024: £85,707).

The Company had cash of £67,879 at 31 March 2025 which the directors believe is insufficient to undertake the required steps to make an investment and fulfil its investment mandate and at the year end the Company was therefore seeking to raise additional capital to proceed with its strategy.

Post year end the Company agreed the refinancing of certain debts on the balance sheet as well raising £1,000,000 of new equity to provide working capital in order for the Company strategy to be executed.

During the year the Company incurred predominantly ongoing administrative costs, as well as some minor expenditure on legal and other associated costs related to the identification of potential targets.

As the company has no revenue it is reliant on its existing cash resources to fund any ongoing expenditure. Should a potential target be identified and significant expenses incurred in the course of undertaking due diligence then the Company might be in a position that its cash resources are depleted and any potential deal may or may not complete. Should any potential deal fail and significant expenses be incurred then the Company might be required to raise additional capital to continue its strategy.

Cash and cash equivalents

Trade Creditors

Trade creditors (being obligations to pay for goods or services acquired in the ordinary course of business are recognised when the company becomes party to the contractual provision of the suppliers invoice and are initially recorded at fair value, which is generally the invoiced amount.

Accruals

Accruals represent liabilities for goods or services received by the Company during the reporting period for which payment has not yet been made or invoiced by the supplier. Accruals are recognised when the Company has a present obligation as a result of a past event and are measured at the best estimate of the amount required to settle the obligation.

Prepayments

Prepayments represent payments made by the Company for goods and services that have not yet been received or consumed at the end of the reporting period. Prepayments are recognised when the company makes a payment in advance for goods or services and are initially recognised at the amount paid in advance representing the fair value of consideration given.

Taxation

Financial instruments

Financial assets

Financial assets are classified, at initial recognition, as subsequently measured at amortised cost, fair value through other comprehensive income (OCI), and fair value through profit or loss. The classification of financial assets at initial recognition depends on the financial asset's contractual cash flow characteristics and the Group's business model for managing them.

As at the reporting date, the Group did not have any financial assets subsequently measured at fair value.

Operating segments

Convertible Loan Notes

Initial Recognition

Upon issuance, convertible loan notes are recognised in accordance with IAS 32 and IFRS 9. The instrument is split into its liability and equity components based on the following approach:

• Liability Component: The fair value of the liability component is determined first by discounting the contractual stream of future cash flows (interest and principal) at the market interest rate for a similar debt instrument without the conversion option. This represents the present value of the issuer's obligation.
• Equity Component: The equity component, representing the conversion option, is calculated as the residual amount, i.e., the difference between the total proceeds received from the issuance of the convertible loan note and the fair value of the liability component.

Subsequent Measurement

Liability Component: The liability component is subsequently measured at amortised cost using the effective interest method. Interest expense is recognised in profit or loss based on the effective interest rate, which reflects the true economic cost of the borrowing.

Equity Component: The equity component is not remeasured after initial recognition, as it represents the residual value of the conversion option classified as equity.

Derecognition and Conversion

At Maturity (No Conversion): If the conversion option is not exercised, the liability component is derecognised upon repayment of the principal and accrued interest. Any related transaction costs or fees are recognized in profit or loss.

Upon Conversion: If the conversion option is exercised, the carrying amount of the liability component and the equity component are derecognised. The issuance of equity instruments is recognised in equity (e.g., share capital and share premium) at the carrying amount of the derecognised components, with no gain or loss recognised on conversion.

Critical accounting estimates and judgements

The preparation of financial statements in compliance with IFRS as adopted for use by the United Kingdom requires the use of certain critical accounting estimates or judgements. The directors do not consider there to be any key estimation uncertainty. In respect of critical judgements, the only key judgement is the adoption of going concern on the basis for preparing the financial statements, details of which are set out in note 2.

Share based payments

• including any market performance conditions;
• excluding the impact of any service and non-market performance vesting conditions; and
• including the impact of any non-vesting conditions.

The fair value of goods or services received in exchange for shares is recognised as an expense.

INCOME TAX EXPENSE

The Company is regarded as resident for the tax purposes in British Virgin Islands.

LOSS BEFORE TAXATION

The loss before income tax is stated after charging:

Ordinary shares have no par value and carry equal rights on control, dividends and upon liquidation.

There are no shares issued and reserved for share options.

STAFF COSTS

• CAPITAL MANAGEMENT POLICY
• FINANCIAL RISK MANAGEMENT

Financial risk factors

Currency risk

The Company does not operate internationally and its exposure to foreign exchange risk is limited to the transactions and balances that are denominated in currencies other than Pounds Sterling.

Credit risk

The Company does not have any major concentrations of credit risk related to any individual customer or counterparty. Credit risk arises from cash and cash equivalents and deposits with banks and financial institutions. The Group has taken necessary steps and precautions in minimising the credit risk by lodging cash and cash equivalents only with reputable licensed banks.

Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and the Company ensures it has adequate resource to discharge all its liabilities. The directors have considered the liquidity risk as part of their going concern assessment. (See note 2). At the date of approval of the financial statements there was a material uncertainty in relation to liquidity risk.

Cash flow interest rate risk

Fair values

FINANCIAL INSTRUMENTS

The Company currently has convertible loan notes ("CLNs" with a principle amount of £515,000 that have either matured as at the end of the year or subsequent to the year end. Following the year end the Company repaid a CLN with a face value of £125, 000 and successfully negotiated a stand still for the remaining loan notes in order to complete an equity raise of £1,000,000 and convert the CLN's into equity. This was all successfully completed in July 2025. For more details see note 14.

There are no financial assets that are either past due or impaired.

RELATED PARTY TRANSACTIONS

*In 2025 £25,000 of fees were incurred to Stonedale Management & Investments Ltd a company controlled by Simon Retter regarding work undertaken on the administration of the company as well as potential target identification. In 2024 this was £25,000.

No pension contributions were made on behalf of the Directors by the Company. No share options were granted to or exercised by a Director in the reporting period.

During the reporting period, other than those noted above the Company did not enter into any material transactions with related parties. As at reporting date, the there was an amount of £90,479 accrued due the directors.

CONTROL

The Directors consider there is no ultimate controlling party.

DESCRIPTION OF RESERVES

Retained Earnings comprises accumulated gains and losses incurred to date.

SHARE BASED PAYMENTS

The company has issued options to a third party with a fixed strike price which are valued using the Black Scholes methodology as well as options that have a nil strike price and an anti dilute clause which results in a variable number of shares being issued. The number of options outstanding at the period ends as well as the inputs to the Black Scholes valuation is set out below:

Fixed price options

The share options were issued when the shares were suspended from trading and so an assumption was made as to potential future volatility based upon the movement in share prices in similar companies and was not based on historic volatility.

Nil strike price

The nil strike priced options were not valued using the Black Scholes model, instead the fair value of the options issued was determined as the value of shares to be issued at any given share price under the terms of the agreement. Due to the inclusion of an antidilution clause the number of shares is to be amended in order to grant the holder a predetermined monetary value of shares, initially calculated at 2pence per share. The 2,500,000 at the year end therefore had a fair value of £50,000.

* The remaining nil strike price options lapsed after the period end without being exercised.

SUBSEQUENT EVENTS

On the 16th April 2025 the Company issued £125,000 of new convertible loan notes convertible at a 10% discount to any future fund raise requiring a prospectus to be issued and carrying interest at 5%. Each share issued under this CLN carried a warrant exercisable at the conversion price.

On 16th April 2025 the Company agreed with certain convertible loan note holders representing £400,000 of the £515,000 outstanding to enter into a standstill arrangement with all past accrued interest to be waived and no applicable future interest should conversion happen prior to the end of the stand still period. Repayment of 75% of the original principle amount advanced and automatic conversion into equity of sums owed under the loan note at the placing price upon Qualifying Fundraise of a minimum of £250,000

On 23rd April 2025 the Company issued 12,438,455 new ordinary shares at a price of 0.6 pence per share raising gross proceeds of £74,631. In addition warrants over 6,219,228 new ordinary shares at a price of 0.8 pence per share.

On 21st May 2025 the Company raised £1,000,000 gross by way of issuing 111,111,111 new ordinary shares in the Company at a price of 0.9 pence per share, subject to the publication of a prospectus. In addition warrants over 6,666,666 new ordinary shares were issued at a price of 0.9 pence per share.

On 24th June 2025 the Company published a prospectus covering the conversion of the various CLN's as well a directors accrued fees and the shares issued under the fundraise agreed on the 21st May 2025. As part of the refinancing of the balance sheet this prospectus covered the issuance of a total of 179,881,590 new ordinary shares.