UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

☒ Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended ~~August~~November 3130, 2024

☐ Transition Report pursuant to 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from ________ to __________

Commission File Number: 333-265368

Medinotec Inc.

(Exact name of registrant as specified in its charter)

Nevada		36-4990343
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

Northlands Deco Park | 10 New Market Street | Stand 299 Avant Garde Avenue

North Riding | South Africa | 2169

(Address of principal executive offices)

+27 87 330 2301

(Registrant's telephone number)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading symbol		Name of each exchange on which registered
None		N/A		N/A

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

☐ Large accelerated filer	☐ Accelerated filer
☒ Non-accelerated Filer	☒ Smaller reporting company
	☒ Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

State the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 11,733,750 common shares as of ~~October~~January 1513, ~~2024~~2025.

Table of Contents

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TABLE OF CONTENTS

		Page
	PART I – FINANCIAL INFORMATION
Item 1:	Consolidated Financial Statements (unaudited for period ended ~~August~~November 3130, 2024)	3
Item 2:	Management’s Discussion and Analysis of Financial Condition and Results of Operations	4
Item 3:	Quantitative and Qualitative Disclosures About Market Risk	1517
Item 4:	Controls and Procedures	1517
	PART II – OTHER INFORMATION
Item 1:	Legal Proceedings	1618
Item 1A:	Risk Factors	1618
Item 2:	Unregistered Sales of Equity Securities and Use of Proceeds	1618
Item 3:	Defaults Upon Senior Securities	1618
Item 4:	Mine Safety Disclosure	1618
Item 5:	Other Information	1618
Item 6:	Exhibits	1718

Table of Contents

PART I - FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements

Our unaudited consolidated financial statements included in this Form 10-Q are as follows:

Page Number
2	Unaudited Consolidated Balance Sheets as of ~~August~~November 3130, 2024 and February 29, 2024;
3	Unaudited Consolidated Statements of Operations and Comprehensive Income/(Loss) for the three and ~~six~~nine months ended ~~August~~November 3130, 2024 and ~~August~~November 3130, 2023;
4	Unaudited Consolidated Statements of Stockholders’ Equity / (Deficit) for the three and ~~six~~nine months ended ~~August~~November 3130, 2024 and ~~August~~November 3130, 2023;
5	Unaudited Consolidated Statements of Cash Flows for the ~~six~~nine months ended ~~August~~November 3130, 2024 and ~~August~~November 3130, 2023; and
6	Notes to the Unaudited Consolidated Financial Statements.

Table of Contents

Medinotec Inc.

Consolidated Financial Statements

Consolidated Balance Sheets (Unaudited)

	August 31, 2024 $			February 29, 2024 $
	November 30, 2024 $			February 29, 2024 $
Assets
Current Assets
Cash		2,~~758~~676,~~325~~525			2,808,910
Accounts receivable, net of allowances		~~771~~992,~~368~~464			589,761
Inventory		1,~~271~~151,~~843~~466			863,452
Other current assets		~~100~~99,~~539~~859			117,174
Total Current Assets		4,~~902~~920,~~075~~314			4,379,297
Loans and notes receivable		—			—
Property, plant and equipment, net of accumulated depreciation		378,294			320,122
Property, plant and equipment, net of accumulated depreciation		327,064			320,122
Deferred tax asset		18,575			42,881
Deferred tax asset		13,777			42,881
Operating right-of-use asset		45,438			61,979
Operating right-of-use asset		52,918			61,979
Total Assets		5,362,621			4,804,279
Total Assets		5,295,834			4,804,279
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable and accrued liabilities		1,~~536~~446,~~781~~751			801,550
Due to stockholders/directors		~~1,588~~—			1,587
Operating lease liability, current portion		2728,~~753~~217			24,316
Total Current Liabilities		1,~~566~~474,~~122~~968			827,453
Long Term Liabilities
Related party loans payable		1,~~171~~041,~~533~~090			1,769,957
Operating lease liability, net of current portion		2820,~~454~~731			39,698
Total Liabilities		2,~~766~~536,~~109~~789			2,637,108
Stockholders’ Equity
Capital stock $.001 par value; shares authorized 200,000,000; 11,733,750 shares issued and outstanding		11,734			11,734
Capital stock additional paid in capital		3,296,391			3,296,391
Retained Earnings (Deficit)		(~~869~~559,~~372~~094	)		(1,241,325	)
Accumulated other comprehensive income		9076,~~972~~801			100,371
Total Equity		2,~~529~~825,~~725~~832			2,167,171
Total Liabilities and Stockholders’ Equity		5,~~295~~362,~~834~~621			4,804,279

The accompanying notes are an integral part of these Consolidated financial statements.

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Medinotec Inc.

Consolidated Statements of Operations and Comprehensive Income/(Loss) (Unaudited)

Three months ended

~~Six~~Nine months ended

August 31, 2024 $

August 31, 2023 $

August 31, 2024 (*) $

August 31, 2023 $

November 30, 2024 $

November 30, 2023 $

November 30, 2024 $

November 30, 2023 $

Revenue

12,~~804~~565,~~020~~048

~~350~~2,~~792~~002,547

35,~~055~~588,~~897~~445

~~766~~2,~~999~~769,547

Cost of goods sold

~~970~~1,~~608~~524,272

601,~~988~~138,628

13,~~622~~113,~~207~~979

~~159~~1,~~486~~298,116

Gross profit

~~833~~1,~~412~~040,776

~~289~~863,~~804~~919

12,~~433~~474,~~690~~466

~~607~~1,~~513~~471,431

Operating expenses

Depreciation and amortization expense

19,~~522~~206

1211,~~402~~604

3756,~~438~~644

2436,~~845~~449

General and administrative expenses

~~353~~379,~~808~~217

~~183~~552,~~329~~342

~~631~~1,~~014~~010,229

~~399~~951,~~444~~786

Research and development expenses

169,~~892~~270

112,~~857~~728

1686,~~872~~142

1416,~~119~~846

Sales and marketing expenses

2245,~~443~~632

2639,~~481~~335

4389,~~451~~083

72111,~~519~~855

Total operating expenses

~~397~~513,~~665~~325

~~234~~606,~~069~~009

~~728~~1,~~775~~242,098

~~510~~1,~~927~~116,936

Income (loss) from operations

~~435~~527,~~747~~451

55257,~~735~~910

~~704~~1,~~915~~232,368

96354,~~586~~495

Non operating income and expenses

Interest income

1514,~~420~~728

1314,~~371~~859

3044,~~188~~916

2742,~~704~~563

Other revenue/(expense)

14(3,~~154~~621

)

(305,~~007~~933

)

1511,~~332~~709

~~701~~(5,232

)

Interest expense

(4743,~~085~~400

)

(7066,~~833~~727

)

(~~105~~148,~~107~~507

)

(~~136~~203,~~406~~133

)

Provision for impairment of note receivable

(13,~~207~~684

)

—(629,458

)

(2639,~~155~~839

)

—(629,458

)

Total non-operating income and expenses

(3045,~~718~~977

)

(87687,~~469~~259

)

(85131,~~742~~721

)

(~~108~~795,~~001~~260

)

Income (loss) before income taxes

~~405~~481,~~029~~474

(31429,~~734~~349

)

~~619~~1,~~173~~100,647

(11440,~~415~~765

)

Income taxes

Current income taxes

~~110~~(180,~~681~~577

)

~~12,300~~—

~~210~~(391,~~837~~414

)

(12,300

)

Deferred income taxes

9,~~599~~414

(1063,~~870~~022

)

36(26,~~383~~969

)

(1250,~~839~~183

)

Net income (loss)

~~284~~310,~~749~~311

(33492,~~164~~371

)

~~371~~682,~~953~~264

(10503,~~876~~248

)

Other comprehensive income (loss) from operations

(514,~~247~~204

)

~~(22,625~~460

)

(923,~~399~~603

)

2122,~~978~~439

Total comprehensive income (loss)

~~279~~296,~~502~~107

(55491,~~789~~911

)

~~362~~658,~~554~~661

11(480,~~102~~809

)

Earnings Per Share:

Basic

0.0203

(0.0004

)

0.0306

(0.0004

)

The accompanying notes are an integral part of these Consolidated financial statements.

* Please refer to note 4 regarding reclassifications.

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Medinotec Inc.

Consolidated Statements of Stockholders’ Equity / (Deficit) (Unaudited)

	Common Stock				Common Stock Additional Paid in Capital
	Shares		Amount $		Amount $		Accumulated Comprehensive Income $			Retained Earnings (Deficit) $			Total $
Balance, February 28, 2023		11,733,750		11,734		3,296,391		84,567			(836,637	)		2,556,055
Net income (loss) for the period		—		—		—		—			(10503,~~876~~248	)		(10503,~~876~~248	)
Other comprehensive income
Net foreign currency translation adjustment		—		—		—		~~(72~~22,~~775~~439	)		~~94,753~~—			2122,~~978~~439
Balance, November 30, 2023		11,733,750		11,734		3,296,391		107,006			(1,339,885	)		2,075,246
Balance, August 31, 2023		11,733,750		11,734		3,296,391		11,792			(752,760	)		2,567,157
Balance, May 31, 2023		11,733,750		11,734		3,296,391		129,170			(814,349	)		2,622,946
Net income (loss) for the period		—		—		—		—			(492,371	)		(492,371	)
Net income (loss) for the period		—		—		—		—			(33,164	)		(33,164	)
Foreign currency apportionment reclassification		—		—		—		94,754			(94,754	)		—
Other comprehensive income
Net foreign currency translation adjustment		—		—		—		~~(117,378~~460	)		~~(94,753~~—	)		~~(22,625~~460	)
Balance, August 31, 2023		11,733,750		11,734		3,296,391		11,792			(752,760	)		2,567,157
Balance, November 30, 2023		11,733,750		11,734		3,296,391		107,006			(1,339,885	)		2,075,246

	Common Stock				Common Stock Additional Paid in Capital
	Shares		Amount $		Amount $		Accumulated Comprehensive Income $			Retained Earnings (Deficit) $			Total $
Balance, February 29, 2024		11,733,750		11,734		3,296,391		100,371			(1,241,325	)		2,167,171
Net income (loss) for the period		—		—		—		—			~~371~~682,~~953~~264			~~371~~682,~~953~~264
Other comprehensive income
Net foreign currency translation adjustment		—		—		—		(923,~~399~~603	)		—			(923,~~399~~603	)
Reclassification adjustment		—		—		—		33			(33	)		—
Balance, November 30, 2024		11,733,750		11,734		3,296,391		76,801			(559,094	)		2,825,832
Balance, August 31, 2024		11,733,750		11,734		3,296,391		90,972			(869,372	)		2,529,725
Balance, May 31, 2024		11,733,750		11,734		3,296,391		96,219			(1,154,121	)		2,250,223
Net income (loss) for the period		—		—		—		—			310,311			310,311
Net income (loss) for the period		—		—		—		—			284,749			284,749
Reclassification adjustment		—		—		—		33			(33	)		—
Other comprehensive income
Net foreign currency translation adjustment		—		—		—		(514,~~247~~204	)		—			(514,~~247~~204	)
Balance, August 31, 2024		11,733,750		11,734		3,296,391		90,972			(869,372	)		2,529,725
Balance, November 30, 2024		11,733,750		11,734		3,296,391		76,801			(559,094	)		2,825,832

The accompanying notes are an integral part of these Consolidated financial statements.

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Medinotec Inc.

Consolidated Statements of Cash Flows

	Six months ended (unaudited)
	Nine months ended (unaudited)
	August 31, 2024 $			August 31, 2023 $
	November 30, 2024 $			November 30, 2023 $
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income/(loss)		~~371~~682,~~953~~264			(10503,~~876~~248	)
Depreciation		4874,~~537~~503			3754,~~268~~664
Interest (received)/paid		(2639,~~155~~839	)		~~104~~(22,~~921~~662	)
Deferred income taxes and tax credits		3227,~~386~~008			(953,~~930~~063	)
Provision for impairment of notes receivable		2639,~~155~~839			—629,458
Provision for doubtful receivables		(2019,~~831~~832	)		—
(Increase) decrease in trade receivables		(~~124~~353,~~112~~323	)		(9555,~~238~~156	)
Decrease (increase) in other assets, net		(6641,~~234~~031	)		~~(12~~39,~~884~~799	)
(Increase)/Decrease in inventories		(~~343~~234,~~462~~558	)		(~~281~~357,~~690~~977	)
Increase/(Decrease) in accounts payable and accrued expenses		~~572~~285,~~147~~442			~~(12~~263,~~827~~291	)
Increase (decrease) in income taxes payable		~~184~~358,~~225~~645			—
TOTAL CASH FLOWS FROM/(USED IN) OPERATING ACTIVITIES		~~645~~779,~~609~~119			~~(281~~101,~~256~~232	)
CASH FLOWS FROM/(USED IN) INVESTING ACTIVITIES:
Payments to acquire property, plant, and equipment		(1790,~~733~~359	)		—(851	)
TOTAL CASH FLOWS FROM/(USED IN) INVESTING ACTIVITIES		(1790,~~733~~359	)		—(851	)
CASH FLOWS FROM/(USED BY) FINANCING ACTIVITIES:
Proceeds from assuming long-term debt		—			~~260,901~~—
Repayment of related party loan		(~~733~~843,~~871~~555	)		—(282,552	)
TOTAL CASH FLOWS FROM/(USED BY) FINANCING ACTIVITIES		(~~733~~843,~~871~~555	)		~~260~~(282,~~901~~552	)
OTHER ACTIVITIES:
Effect of exchange rate on cash and cash equivalents		4622,410			3133,~~452~~462
Net cash increase (decreases) in cash and cash equivalents		(50132,~~585~~385	)		11(148,~~097~~709	)
Cash and cash equivalents at beginning of the period		2,808,910			2,827,457
Cash and cash equivalents at end of period		2,~~758~~676,~~325~~525			2,~~838~~678,~~554~~748
Supplemental disclosure of cash flow information:
Cash paid for:
Interest		—			2130,~~454~~244
Income taxes		~~127~~179,~~155~~455			—
Cash received for:
Interest		3,~~330~~178			~~14,979~~—
Income taxes		95,232			—
Supplemental disclosure for non-cash activities
Right-of-use assets in exchange for lease liabilities		3,~~619~~361			—

The accompanying notes are an integral part of these Consolidated financial statements.

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Medinotec Inc.

Notes to the Unaudited Consolidated Entities Financial Statements

For the period ended ~~August~~November 3130, 2024

1. Description of Business

Medinotec Inc. is a United States based company primarily invested in DISA Medinotec Proprietary Limited (“DISA Medinotec”), a leading South African manufacturer and distributor of medical devices specializing in tracheal non-occlusive airway dilation technology.

Medinotec Inc. established Medinotec Capital Proprietary Limited as a wholly owned subsidiary in South Africa. In March 2022, Medinotec Capital successfully acquired DISA Medinotec Proprietary Limited after demonstrating the feasibility of a private placement of at least $3 million. This acquisition formed the “Medinotec Group of Companies,” a South African-based medical device manufacturing and distribution entity.

While the majority of the Company’s operations are located in South Africa, it aims to expand its presence in the U.S. market.

Revenue generation from contracts in South Africa constitutes the largest segment of the Company’s operations and will be used to fund the rollout of its own intellectual property (IP) products in the United States.

The Company received FDA 510(k) approval for its flagship product, the Trachealator, in November 2021, facilitating its entry into the U.S. market.

Medinotec is quoted on the OTCQX and trades under the symbol MDNC. The Company is actively pursuing opportunities to enhance its sales and distribution operations in the U.S., aiming to diversify its revenue streams while continuing to strengthen its position in the South African market.

2. Significant Accounting Policies

a. Nature of business/basis of preparation

Basis of presentation

The consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States.

Emerging Growth Company (ECG) status

The Company is an "emerging growth company" (EGC) as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"). As an EGC, the Company may take advantage of certain exemptions from various reporting and regulatory requirements applicable to other public companies. Emerging growth companies are permitted:

•

to include less extensive narrative disclosure than required of other reporting companies, particularly in the description of executive compensation;

•

to provide audited financial statements for two fiscal years, in contrast to other reporting companies, which must provide audited financial statements for three fiscal years;

•

not to provide an auditor attestation of internal control over financial reporting under Sarbanes-Oxley Act Section 404(b);

•

to defer complying with certain changes in accounting standards; and

•

to use test-the-waters communications with qualified institutional buyers and institutional accredited investors.

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A company continues to be an emerging growth company for the first five fiscal years after it completes an IPO, unless one of the following occurs:

•

its total annual gross revenues are $1.235 billion or more;

•

it has issued more than $1 billion in non-convertible debt in the past three years; or

•

it becomes a “large accelerated filer,” as defined in Exchange Act Rule 12b-2.

The Company has elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b) of the JOBS Act. As a result, its financial statements may not be comparable to those of companies that comply with public company effective dates. The Company intends to adopt the relevant standards upon losing its EGC status, unless it elects to forgo this election irrevocably.

In light of these factors, the Company recognizes that it may take advantage of certain exemptions from various reporting and regulatory requirements that are applicable to other public companies. This status provides the Company with flexibility as it seeks to grow its business and establish a stronger market presence.

b. Foreign currency translation

i. Translation of foreign subsidiary

The accounts of the foreign subsidiaries are translated into U.S. dollars. Assets and liabilities are translated at year-end exchange rates and income and expense accounts are translated at average exchange rates in effect during the year. Translation adjustments resulting from fluctuations in the exchange rates are recorded in accumulated other comprehensive income, a separate component of stockholders' equity.

ii. Exposed to currency variations in subsidiary

The primary operations and functional currency of both Disa Medinotec (Pty) Ltd and Medinotec Capital (Pty) Ltd is in South African Rand. Due to the emerging market nature of this currency the spread volatility of the currency low and high can be material during a year. The conversion of the currency from Rand to reporting currency US Dollar can cause significant up or downward trends that are recorded in reserves under the heading accumulated comprehensive income.

The functional currency as well as the reporting currency for Medinotec Inc is the US Dollar.

c. Cash and cash equivalents

i. Highly liquid investments

The Medinotec Group of Companies considers all highly liquid investments with a remaining maturity of three months or less at the time of purchase to be cash equivalents. These cash equivalents consist primarily of term deposits and certificates of deposit. Investments with maturities from greater than three months to one year are classified as short-term investments, while those with maturities in excess of one year are classified as long-term investments. Cash equivalents and short-term investments are stated at cost which approximates market value.

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d. Accounts Receivables

i. Allowance based on a review and management evaluation

Accounts receivables are presented on the consolidated balance sheets, net of estimated uncollectible amounts. The carrying amounts of trade accounts receivable represent the maximum credit risk exposure of these assets.

In accordance with FASB ASC 326, Measurement of Credit Losses on Financial Instruments ("ASC 326"), the Company evaluates the collectability of outstanding accounts receivable balances to determine an allowance for credit losses that reflects its best estimate of the lifetime expected credit losses.

An allowance for credit losses is is calculated taking into account all accounts older than 91+ days (prior year: 121+ days).

e. Property, plant and equipment

i. Depreciation rates


Plant and machinery			10 years
Laboratory equipment			5 years
Furniture and fixtures			6 years
Motor vehicles			5 years
Computer equipment			3 years
Office equipment			6 years
Computer software			2 years
Leasehold improvements			3 years
Small assets			1 year

The Company utilizes the straight-line method of depreciation for its assets, which allows for the systematic allocation of the cost of the asset over its useful life. The primary categories of assets include plant and machinery and laboratory equipment, which are depreciated based on their estimated useful lives, typically determined by industry standards and historical experience.

To establish the depreciation rate for each asset, the Company considers several factors, including the asset's purchase price, estimated useful life, and residual value at the end of that life. Useful lives are assessed based on the nature of the asset, technological advancements, and the expected rate of wear and tear. For other supportive assets, such as computer equipment, furniture and fittings, motor vehicles, office equipment, off-the-shelf software, leasehold improvements, and smaller assets, the straight-line method is also applied. Each asset's depreciation rate is reviewed periodically and adjusted if necessary to reflect changes in usage patterns or asset conditions. This method ensures that the expense recognition of these assets is consistent with their utilization and accurately reflects the Company’s financial position.

f. Inventories

i. Valuation, costing and obsolescence

Inventories are stated at the lower of cost (weighted average) or net realizable value and consist of raw materials, work-in process and finished goods and include purchased materials, machine time, direct labor and manufacturing overhead.

Management evaluates the need to record adjustments to write down inventory to the lower of cost or net realizable value on a quarterly basis. The Company’s policy is to assess the valuation of all inventories, including raw materials, work-in-process and finished goods and it writes down its inventory for estimated obsolescence based upon the age of inventory and assumptions about future demand and usage.

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g. Impairment of long-lived assets

The Company assesses long-lived assets for impairment in accordance with the provisions of Financial Accounting Standards Board ASC 360, Property, Plant and Equipment. Long-lived assets (asset group), such as property and equipment subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable.

The carrying amount of a long-lived asset is not recoverable if it exceeds the sum of the undiscounted future cash flows expected to result from the use and eventual disposition of the asset. The amount of impairment loss, if any, is measured as the difference between the carrying value of the asset and its estimated fair value.

Fair value is determined through various valuation techniques, including discounted cash flow models, quoted market values, and third-party independent appraisals, as considered necessary.

h. Leases

We determine if an arrangement is a lease at inception. We determine the classification of the lease, whether operating or financing, at the lease commencement date, which is the date the leased assets are made available for use. We use the non-cancelable lease term when recognizing the right-of-use (“ROU”) assets and lease liabilities, unless it is reasonably certain that a renewal or termination option will be exercised. We account for lease components and non-lease components as a single lease component. Modifications are assessed to determine whether incremental differences result in new contract terms and accounted for as a new lease or whether the additional right of use should be included in the original lease and continue to be accounted for with the remaining ROU asset.

Operating lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of the lease payments over the lease term. Lease payments consist of the fixed payments under the arrangement, less any lease incentives. Variable costs, such as common area maintenance costs and additional payments for percentage rent, are not included in the measurement of the ROU assets and lease liabilities but are expensed as incurred. As the implicit rate of the leases is not determinable, we use an incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments in determining the present value of the lease payments. Lease expenses are recognized on a straight-line basis over the lease term. We do not recognize ROU assets on lease arrangements with a term of 12 months or less.

i. Allowance for loan impairment

The Company records allowances for loan impairment when it is determined that the Company will be unable to collect amounts due to the Company according to the terms of the underlying agreement.

j. Employee benefit plans

The Company contributes 2.5% of basic salaries for eligible employees to a pension plan registered under the laws of South Africa. The Company also contributes a portion of the medical aid contribution for eligible employees to an approved medical insurance scheme.

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k. Income taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

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The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs.

The Company records interest related to unrecognized tax benefits in interest expense and penalties in general and administrative expenses.

l. Financial instruments

i. Fair Value Measurements

Fair value accounting is applied to all assets and liabilities and nonfinancial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). Fair value is defined as the exchange price that would be received for an asset or an exit price that would be paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The consolidated entities follow the established framework for measuring fair value and reports disclosures about fair value measurements.

ii. Concentrations of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, trade accounts receivable and loans. The Company invests its excess cash in low-risk, highly liquid money market funds and certificates of deposit with a major financial institution.

iii. Exposed to currency variations in subsidiary

The primary operations and functional currency of a subsidiary's business is in South African Rand. Due to the emerging market nature of this currency the spread volatility of the currency low and high can be material during a year. The conversion of the currency from Rand to reporting currency US Dollar can cause significant up or downward trends that is recorded in reserves under the heading accumulated comprehensive income. The effect on the reserves for the quarter ended ~~August~~November 3130, 2024 was ($514,~~247~~204) compared to $~~117,378~~460 for the quarter ended ~~August~~November 3130, 2023, and ($923,~~399 for~~603) for the ~~six~~nine months ending ~~August~~November 3130, 2024 compared to $7222,~~775~~439 for the ~~six~~nine months ending ~~August~~November 3130, 2023.

iv. Interest rate Risk

Market interest rate risk may result in loss from fluctuations in the future cash flows or fair values of financial instruments. Interest rate risk is managed principally through monitoring interest rate gaps and basis risk and by having pre-approved limits for repricing bands.

The interest rate risk relates predominantly to the related party loan.

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m. Comprehensive income/loss

i. Comprehensive income/loss

Comprehensive income/loss consists of net income/loss and other gains and losses affecting stockholders’ equity that, under GAAP, are excluded from net income/loss. Our other comprehensive income represents foreign currency translation adjustment attributable to our operations. Refer to Consolidated Statements of Comprehensive Income/(Loss).

Total foreign currency ~~transaction~~ transaction gains and losses for the quarter ended ~~August~~November 3130, 2024 was a $514,~~247~~ 204 loss compared to a $~~22,625 loss~~460 gain for the quarter ended ~~August~~November 3130, 2023, and a $923,~~399~~ 603 loss for the ~~six~~nine months ending ~~August~~November 3130, 2024 compared to a $2122,~~978~~439 gain for the ~~six~~nine months ending ~~Aug~~November 3130, 2023.

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n. Revenue recognition

The Company generates revenues through two distinct revenue sources

From the sale of high-quality medical devices which are self-manufactured through in-depth research and development; and

ii.

Through the distribution of finished products on behalf of other principals around the world into pre-agreed territories, which are usually exclusive territories granted by such principal.

The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its arrangements:

	i.	identify the contract with a customer,

	ii.	identify the performance obligations in the contract,

	iii.	determine the transaction price,

	iv.	allocate the transaction price to performance obligations in the contract, and

	v.	recognize revenue as the performance obligation is satisfied.

Revenue from the sale of self-manufactured products

These products are developed in-house.

The Company’s clients are billed based on a pricelist that is agreed on in each customer’s contract. Orders are shipped on a per order basis from the Company’s warehouse with Free-On-Board terms.

Revenues relating to the self-manufactured products are recognized when control of the promised goods or services is transferred to a customer in an amount that reflects the consideration that the Company expects to receive in exchange for those products.

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Revenue from the distribution of products

The distribution products are sold via a network, which consists of a mixture of sub-distributors and, in some instances, a direct sales force. The Company’s clients are billed based on a pricelist that are agreed upon in each customer contract, orders are shipped on a per order basis from the Company’s warehouse with Free-on-Board terms. The Company’s sub-distributors order from the Company on the same basis as its customers and have no preferential return rights on their inventory orders, therefore the client assumes the risk of the sale at point of invoice.

Revenues are recognized primarily when we transfer control to the customer, which can be on the date of shipment, the date of receipt by the customer or, for implants, when we have received a purchase order and appropriate notification the product has been used or implanted.

Goods delivered to a consignee pursuant to a consignment arrangement are not considered sales, and do not qualify for revenue recognition. Once it is determined that substantial risk of loss, rewards of ownership, as well as control of the asset have transferred to the consignee, revenue recognition would then be appropriate, assuming all other criteria for revenue recognition have been satisfied.

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For both revenue streams

The Company has two operating segments, inside the United States and outside the United States. These sales are split by these territories and further segregated into the specific revenue streams sold into these territories. Sales represent the amount of consideration we expect to receive from customers in exchange for transferring products and services. Net sales exclude sales and value added taxes we collect from customers. Other costs to obtain and fulfill contracts are generally expensed as incurred due to the short-term nature of most of our sales. We extend terms of payment to our customers based on commercially reasonable terms for the markets of our customers, while also considering their credit quality.

A provision for estimated sales returns, discounts and rebates is recognized as a reduction of sales in the same period that the sales are recognized. Our estimate of the provision for sales returns has been established based on contract terms with our customers and historical business practices and current trends. Shipping and handling costs charged to customers are included in net sales.

The Company has no contract assets or liabilities representing accrued revenues that have not yet been billed to the customers due to certain contractual terms, because orders are placed, invoiced, and shipped on a per order basis as and when the clients require additional inventory. All revenue is recognized at a specific point and time.

Under ASC Topic 606, the Company estimates the transaction price, including variable consideration, at the commencement of the contract and recognizes revenue at point of sale when risks and rewards are transferred to the customer. There are no contract revenue agreements that would need to be recognized over time and the point of risks and rewards being transferred is very clear.

Payment Terms

Our payment terms vary per segments; export sales made from within South Africa are subject to prepayment, where accounts are granted. They generally have payment terms of 30 days from statement and sales made inside the United States are 45 to 60 days. Terms can be extended by the Company when it deems the business case and creditworthiness of the customer is strong enough. The time between a customer’s payment and the receipt of funds is not significant. The Company’s contracts with customers do not result in significant obligations associated with returns, refunds, or warranties. Payment terms are generally fixed and do not include variable revenues.

The Company sells a significant amount to DISA Life Sciences, a non-related medical device distributor in South Africa. For the quarter ending November 30, 2024, 94% of the Company's total revenue was derived from this single customer in the distribution environment in South Africa compared to 79% for the quarter ending November 30, 2023, and 92% for the nine months ending November 30, 2024 compared to 66% for the nine months ending November 30, 2023.

This table indicates the sales per revenue stream as a breakdown of the total revenue balance:

	Medinotec Group of Companies Consolidated Three Months Ended (unaudited)				Medinotec Group of Companies Consolidated Nine Months Ended (unaudited)
	November 30, 2024		November 30, 2023		November 30, 2024		November 30, 2023
	$		$		$		$
Outside of United States of America
Internally Designed/Manufactured Sales		150,915		526,519		574,485		1,009,226
Distribution Agreement Sales		2,199,199		1,344,803		4,500,271		1,344,803
Sales Generated inside the United States of America
Internally Designed/Manufactured Sales		214,934		131,225		513,689		415,518
		2,565,048		2,002,547		5,588,445		2,769,547

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The ~~Company~~following ~~sells~~table asets ~~significant~~forth ~~amount~~financial toinformation ~~DISA~~by ~~Life~~reportable ~~Sciences,~~segment afor ~~non-related medical device distributor in South Africa. For~~ the ~~quarter~~periods ending ~~August~~November 3130, 2024, ~~89% of the Company's total revenue was derived from this single customer in the distribution environment in South Africa compared to 56% for the quarter ending August 31, 2023,~~ and ~~89%~~November ~~for the six months ending August 31~~30, ~~2024 compared to 44% for the six months ending August 31,~~ 2023.:

This table indicates the sales per revenue stream as a breakdown of the total revenue balance:

	Medinotec Group of Companies Consolidated 3 Months Ended				Medinotec Group of Companies Consolidated 6 Months Ended
	August 31, 2024		August 31, 2023		August 31, 2024		August 31, 2023
	$		$		$		$
Outside of United States of America
Internally Designed/Manufactured Sales		280,310		241,418		423,570		482,705
Distribution Agreement Sales		1,360,728		—		2,333,572		—
Sales Generated inside the United States of America
Internally Designed/Manufactured Sales		162,982		109,374		298,755		284,294
		1,804,020		350,792		3,055,897		766,999

The following table sets forth financial information by reportable segment for the periods ending August 31, 2024 and August 31, 2023:

Income/(loss) from operations

	Medinotec Group of Companies Consolidated 3 Months Ended August 31,
		Medinotec Group of Companies Consolidated Three Months Ended November 30 (unaudited)
	~~Inside the United States ($)~~	Inside the United States ($)	~~Outside the United States ($)~~		~~Total ($)~~				Outside the United States ($)				Total ($)
	~~2024~~	~~2023~~2024	~~2024~~	~~2023~~	~~2024~~	2023			2024		2023		2024		2023
Revenue	~~162,982~~	~~109,374~~	1214,~~641,038~~934	~~241,418~~	~~1,804,020~~	~~350,792~~	131,225			2,350,114		1,871,322		2,565,048		2,002,547
Cost of goods sold	~~16,059~~	~~10,156~~	~~954~~28,~~549~~603	~~50,832~~	~~970,608~~	~~60,988~~	11,873			1,495,669		1,126,755		1,524,272		1,138,628
Gross profit	~~146,923~~	~~99,218~~	~~686~~186,~~488~~331	~~190,586~~	~~833,412~~	~~289,804~~	119,352			854,445		744,567		1,040,776		863,919
Selling expenses	~~11,347~~	~~2,167~~	1131,~~096~~034	~~24,314~~	~~22,443~~	~~26,481~~	3,493			14,598		35,842		45,632		39,335
Depreciation expense	—	—	~~19,522~~—	~~12,402~~	~~19,522~~	~~12,402~~	—			19,206		11,604		19,206		11,604
General and administrative expenses	~~140,727~~	~~99,708~~	~~213~~248,~~081~~925	~~83,621~~	~~353,808~~	~~183,329~~	122,348			130,292		429,994		379,217		552,342
Research and development expenses	—	—	150,~~892~~000	~~11,857~~	~~1,892~~	~~11,857~~	—			19,270		2,728		69,270		2,728
Income/(loss) from operations	~~(5,151)~~	~~(2,657)~~	~~440~~(143,~~898~~628	~~58,392~~)	~~435,747~~	~~55,735~~	(6,489	)		671,079		264,399		527,451		257,910
Provision for impairment of note receivable	~~13,207~~	—	—13,684	—	~~13,207~~	—	629,458			—		—		13,684		629,458


	Medinotec Group of Companies Consolidated Nine Months Ended November 30 (unaudited)
	Inside the United States ($)					Outside the United States ($)				Total ($)
	2024			2023		2024		2023		2024		2023
Revenue		513,689			415,518		5,074,756		2,354,029		5,588,445		2,769,547
Cost of goods sold		58,140			35,979		3,055,839		1,262,137		3,113,979		1,298,116
Gross profit		455,549			379,539		2,018,917		1,091,892		2,474,466		1,471,431
Selling expenses		54,320			14,825		34,763		97,030		89,083		111,855
Depreciation expense		—			—		56,644		36,449		56,644		36,449
General and administrative expenses		522,048			336,950		488,181		614,836		1,010,229		951,786
Research and development expenses		50,000			—		36,142		16,846		86,142		16,846
Income/(loss) from operations		(245,663	)		27,764		986,705		326,731		1,232,368		354,495
Provision for impairment of note receivable		39,839			629,458		—		—		39,839		629,458

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	Medinotec Group of Companies Consolidated 6 Months Ended August 31,
	Inside the United States ($)		Outside the United States ($)		Total ($)
	2024	2023	2024	2023	2024	2023
Revenue	298,755	284,294	2,757,142	482,705	3,055,897	766,999
Cost of goods sold	29,537	24,105	1,592,670	135,381	1,622,207	159,486
Gross profit	269,218	260,189	1,164,472	347,324	1,433,690	607,513
Selling expenses	23,286	11,332	20,165	61,187	43,451	72,519
Depreciation expense	—	—	37,438	24,845	37,438	24,845
General and administrative expenses	273,123	214,602	357,891	184,842	631,014	399,444
Research and development expenses	—	—	16,872	14,119	16,872	14,119
Income/(loss) from operations	(27,191)	34,255	732,106	62,331	704,915	96,586
Provision for impairment of note receivable	26,155	—	—	—	26,155	—

The following table sets forth financial information by reportable segment for the periods ending November 30, 2024 and February 29, 2024:

The following table sets forth financial information by reportable segment for the periods ending August 31, 2024 and February 29, 2024:

Total Assets

~~Inside the United States~~

Inside the United States

~~Outside the United States~~

~~Total~~

Outside the United States

Total

August 31, 2024

February 29, 2024

August 31, 2024

February 29, 2024

August 31, 2024

February 29, 2024

November 30, 2024 (unaudited)

February 29, 2024

November 30, 2024 (unaudited)

February 29, 2024

November 30, 2024 (unaudited)

February 29, 2024

Total assets

~~2,386,054~~

~~2,697,502~~

2,~~909~~340,~~780~~205

~~2,106,777~~

~~5,295,834~~

~~4,804,279~~

2,697,502

3,022,416

2,106,777

5,362,621

4,804,279

The major component of total ~~assets~~ assets is "Cash" of $2,~~758~~676,~~325~~525 as of ~~August~~November 3130, 2024 and $2,808,910 as of February 29, 2024. A significant portion of this is maintained Inside the United States in USD of $2,~~205~~068,~~404~~ 417 as of ~~August~~November 3130, 2024 and $2,478,434 as of February 29, 2024.

o. Cost of goods sold

The cost of goods sold consists primarily of raw material purchases, manufacturing costs and employee benefits paid to operational personnel associated with the production of our medical devices.

p. General and administrative expenses

General and administrative expenses consist mostly of personnel costs, consulting fees as well as audit fees.

q. Research and development

The Company follows the guidance provided in ASC 730, "Research and Development," in accounting for research and development (R&D) expenses. R&D activities primarily focus on the development of new products through modifications of existing technologies or projects with an established proof of concept. As such, the Company typically incurs R&D expenses related to production support, process improvements, and quality enhancement initiatives.

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In accordance with ASC 730, the Company expenses all R&D costs as incurred. This includes costs directly related to research activities, as well as expenses associated with the design, development, and testing of new products and processes.

In instances where R&D projects evolve and the nature of the expenses becomes capital in nature, the Company will evaluate these costs against the following criteria to determine if they should be capitalized:

	•	Technological Feasibility: The project must have reached a stage where technological feasibility has been established. This typically occurs when all necessary design, testing, and evaluation processes have been completed, and the product can be produced to meet its specifications.

	•	Intent to Complete: There must be a clear intention to complete the project for sale or use. This involves assessing whether the Company plans to bring the product to market and if there is a viable market for it.

	•	Future Economic Benefits: The project is expected to generate future economic benefits, such as revenue from product sales or cost savings from process improvements.

	•	Directly Attributable Costs: The costs being evaluated for capitalization must be directly attributable to the development of the product or process, including materials, labor, and overhead.

Any costs deemed eligible for capitalization will be recorded as assets and amortized over their useful lives, while all other R&D expenditures will continue to be expensed in the period incurred.

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r. Interest expense

Interest expense relates mostly to an unsecured loan from Minoan Medical, which is repayable over the next 2 years. The loan carries interest at the prevailing prime lending ~~rate~~ rate of the time. The prevailing lending rate in South Africa was 11.7525% at ~~August~~November 3130, 2024. The terms of this loan are deemed to be market related.

s. Earnings per share

Basic Earnings Per Share (EPS)

Basic earnings (loss) per share are computed based on the weighted average number of common shares outstanding during the reporting period. This calculation provides a straightforward measure of the Company’s earnings attributable to each share.

Diluted Earnings Per Share (EPS)

Diluted earnings per share are computed by giving effect to all potentially dilutive securities outstanding during the period, including options, warrants, and convertible securities. The calculation aims to reflect the potential dilution that could occur if these securities were converted into common shares.

In periods where the Company reports net losses, diluted net loss per share is the same as basic net loss per share. This is because potentially dilutive common shares are not assumed to have been issued if their inclusion would be anti-dilutive.

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Treasury Stock Method

For options and warrants, the Company employs the treasury stock method to calculate the dilutive effect. Under this method, it is assumed that the proceeds from the exercise of options and warrants would be used to repurchase common shares at the average market price during the period. The number of shares repurchased is then subtracted from the total number of shares that would be issued upon exercise, resulting in the net increase in shares outstanding. This method effectively illustrates the potential dilution impact of these securities on earnings per share.

t. Principles of consolidation

i. Consolidated - all intercompany transactions eliminated

The consolidated financial statements include the accounts of Medinotec Inc., Medinotec Capital Proprietary Limited and the financial statements of DISA Medinotec Proprietary Limited, known as the Medinotec Group of Companies. All intercompany transactions have been eliminated.

u. Use of estimates

i. Actual results could differ

The preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) requires management to make estimates and assumptions that impact the reported amounts of assets and liabilities, as well as the disclosure of contingent assets and liabilities as of the date of the financial statements. Additionally, these estimates influence the reported amounts of revenues and expenses during the reporting period. Actual results may differ from these estimates, which could have an impact on future periods.

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Key estimates that management typically needs to make in a smaller medical device public company include:

• Revenue Recognition: Estimating the timing and amount of revenue to be recognized, particularly in relation to sales agreements, warranties, and return policies. • Inventory Valuation: Assessing the net realizable value of inventory, including potential obsolescence and excess stock, to ensure that inventory is stated at the lower of cost or market. • Impairment of Assets: Determining whether there are indicators of impairment for long-lived assets, including intangible assets and goodwill, which involves assessing the recoverability of the asset's carrying value. • Clinical Trial Costs: Estimating the costs associated with clinical trials and research and development activities, which can be significant for product development. • Contingent Liabilities: Evaluating potential legal and regulatory claims, including product liabilities, and estimating the likelihood and potential financial impact of such claims. • Useful Lives of Assets: Estimating the useful lives of property, plant, and equipment, as well as intangible assets, to determine appropriate depreciation and amortization expense.

• Inventory Valuation: Assessing the net realizable value of inventory, including potential obsolescence and excess stock, to ensure that inventory is stated at the lower of cost or market.

• Impairment of Assets: Determining whether there are indicators of impairment for long-lived assets, including intangible assets and goodwill, which involves assessing the recoverability of the asset's carrying value.

• Clinical Trial Costs: Estimating the costs associated with clinical trials and research and development activities, which can be significant for product development.

• Contingent Liabilities: Evaluating potential legal and regulatory claims, including product liabilities, and estimating the likelihood and potential financial impact of such claims.

• Useful Lives of Assets: Estimating the useful lives of property, plant, and equipment, as well as intangible assets, to determine appropriate depreciation and amortization expense.

Management continually evaluates these estimates and assumptions based on historical experience and various other factors, including current market conditions. Changes in these estimates may have a material effect on the Company’s financial position and results of operations.

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v. Recently issued accounting standards

In August 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-05, Business Combinations-Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement (“ASU 2023-05”), which addresses the accounting for contributions made to a joint venture, upon formation, in a joint venture’s separate financial statements. The amendments require certain joint ventures to apply a new basis of accounting upon formation by recognizing and initially measuring most of their assets and liabilities at fair value. The objectives of the amendments are to provide decision-useful information to investors and other allocators of capital in a joint venture’s financial statements and also to reduce diversity in practice. ASU 2023-05 is effective for both public and private joint venture entities with a formation date on or after January 1, 2025. Early adoption is permitted. Entities may elect to apply the guidance retrospectively to joint ventures with a formation date prior to January 1, 2025. The Company does not expect the adoption of this standard to have a material impact on its consolidated financial statements and related disclosures.

In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement (Topic 820), Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions to clarify that a contractual restriction on the sale of an equity security is not considered part of a unit of account of the equity security, and, therefore, is not considered in measuring fair value. The amendments also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction. The amendments also require the following disclosures for equity securities subject to the contractual sale restrictions.

1. The fair value of equity securities subject to the contractual sale restrictions is reflected on the balance sheet.

2. The nature and remaining duration of the restriction(s).

3. The circumstances that could cause a lapse in the restriction(s).

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This guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within those financial years. The Company does not expect the adoption of this standard to have a material impact on the Company’s consolidated financial statements and related disclosures.

In September 2022, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) ASU 2022-04, Liabilities - Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations, which enhances transparency surrounding the use of supplier finance programs. The new guidance requires qualitative and quantitative disclosure sufficient to enable users of the financial statements to understand the nature, activity during the period, changes from period to period and potential magnitude of such programs. The amendments are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years, except for the amendment on roll forward information, which is effective for fiscal years beginning after December 15, 2023.

In November 2023, the FASB issued ASU 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures", which amends the disclosure to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses on an annual and interim basis for to enable investors to develop more decision-useful financial analyses. All public entities will be required to report segment information in accordance with the new guidance starting in annual periods beginning after December 15, 2023. The Company is currently assessing the potential impacts of ASU 2023-06 and does not expect the adoption of this guidance will have a material impact on its consolidated financial statements and disclosures.

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In December 2023, the FASB issued ASU 2023-09, " Income Taxes (Topic 740): Improvements to Income Tax Disclosures", which amends the disclosure to address investor requests for more transparency about income tax information through improvements to income tax disclosures primarily related to the rate reconciliation and income taxes paid information and includes certain other amendments to improve the effectiveness of income tax disclosures. For entities other than public business entities, the requirements will be effective for annual periods beginning after December 15, 2025. The guidance will be applied on a prospective basis with the option to apply the standard retrospectively. Early adoption is permitted. The Company is currently assessing potential impacts of ASU 2023-09 and does not expect the adoption of this guidance will have a material impact on its consolidated financial statements and disclosures and the Company is in a loss position and not incurring any tax expenses.

3. Fair Value Measurements

The Consolidated entities report all financial assets and liabilities and nonfinancial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The authoritative guidance establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows:

Level 1—Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.

Level 2—Inputs are observable, unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities.

Level 3—Inputs are unobservable inputs for the asset or liability.

The level in the fair value hierarchy within which a fair value measurement in its entirety falls is based on the lowest-level input that is significant to the fair value measurement in its entirety.

On ~~August~~November 3130, 2024, and ~~August~~November 3130, 2023, all of the Company’s cash and cash equivalents, trade accounts receivable and trade accounts payable were short term in nature, and their carrying amounts approximate fair value. Our current and long-term debt arrangements are classified as level 2 financial instruments.

~~4. Reclassification of Financial Statement Items~~F-16

During the preparation of the financial statements for the current reporting period, management identified certain items that were reclassified to enhance the clarity and transparency of the presentation and better alignment to the practical application of the contractual terms. These reclassifications have no impact on the Company’s net profit or loss for the period, nor do they affect cash flows, or reserves as the total amounts remain unchanged.

The adjustments will therefore result in:

	Three months ended				Six months ended
	August 31, 2024		August 31, 2023		August 31, 2024			August 31, 2023
	$		$		$			$
Original item: Cost of sales		—		—		(747,421	)		—
Reclassified to: Sales		—		—		747,421			—
Original item: General and administrative expenses		—		—		(327,950	)		—
Reclassified to: Sales		—		—		327,950			—

5. Property, plant and equipment

Property, plant and equipment consist of the following:

	August 31, 2024 $			February 29, 2024 $
Computer software		1,194			—
Motor vehicles		12,799			11,889
Plant and machinery		1,152,640			1,056,830
Furniture and fittings		106,682			99,098
Computer equipment		157,633			145,891
Laboratory equipment		258,110			238,799
Total cost		1,689,058			1,552,507
Foreign currency adjustment		94,719			35,626
Total accumulated depreciation		(1,267,275	)		(1,268,011	)
Total		327,064			320,122

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~~Depreciation of property~~4. Property, plant and ~~equipment~~ totaled approximately $25,309 for the quarter ending August 31, 2024 compared to $18,665 for the quarter ending August 31, 2023, and $48,537 for the six months ending August 31, 2024 compared to $37,268 for the six months ending August 31, 2023.equipment

Property, plant and equipment consist of the following:


	November 30, 2024 (unaudited) $			February 29, 2024 $
Computer software		1,133			—
Motor vehicles		11,889			11,889
Plant and machinery		1,144,371			1,056,830
Furniture and fittings		99,098			99,098
Computer equipment		146,437			145,891
Laboratory equipment		239,834			238,799
Total cost		1,642,762			1,552,507
Foreign currency adjustment		22,749			35,626
Total accumulated depreciation		(1,287,217	)		(1,268,011	)
Total		378,294			320,122

Depreciation of property, plant and equipment totaled approximately $24,892 for the quarter ending November 30, 2024 compared to $17,397 for the quarter ending November 30, 2023, and $73,429 for the nine months ending November 30, 2024 compared to $54,664 for the nine months ending November 30, 2023.

The Company has not acquired any property and equipment under capital leases.

Depreciation Allocation to Cost of Goods Sold:

A portion of the depreciation expense related to Property, Plant, and Equipment has been allocated to the Cost of Goods Sold. This practice is in accordance with the company's accounting policy, which recognizes a portion of the depreciation expense as part of the cost of producing goods.

The allocation of depreciation to Cost of Goods Sold is based on the estimation of the assets' usage in the production process. This method is employed to better match the cost of assets with the revenue generated during the period.

Depreciation of $5,~~787~~685 was allocated to Cost of Goods Sold for the quarter ending ~~August~~November 3130, 2024, compared to $65,~~221~~793 for the quarter ending ~~August~~November 3130, 2023, and $1116,~~099~~785 for the ~~six~~nine months ending ~~August~~November 3130, 2024 compared to $1218,~~422~~215 for the ~~six~~nine months ending ~~August~~November 3130, 2023.

65. Inventories

a. Accounts by period

Inventory consists of the following:

	August 31, 2024 $			February 29, 2024 $
	November 30, 2024 (unaudited) $			February 29, 2024 $
Stock on hand		1,~~282~~162,~~846~~331			861,451
Less provisions for obsolescence		(1110,~~003~~865	)		(10,221	)
Goods in transit		—			12,223
Total		1,~~271~~151,~~843~~466			863,452

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The write-down of inventory reflects management's assessment of net realizable value based on current market conditions and estimates of future sales. Once inventory has been written down, the new cost basis cannot be subsequently increased based on changes in underlying facts and circumstances. This ensures that inventory is accurately reported and reflects the economic realities of the Company’s operations.

The obsolescence reserve is established based on an analysis of inventory turnover, historical sales data, and future sales forecasts. The reserve is reviewed periodically and adjusted as necessary to ensure that the inventory value accurately represents the amount expected to be realized upon sale.

76. Note Receivable

	August 31, 2024 $			February 29, 2024 $
	November 30, 2024 (unaudited) $			February 29, 2024 $
Note receivable		~~664~~681,~~196~~851			638,041
Allowance for impairment		(~~664~~681,~~196~~851	)		(638,401	)
Total		—			—

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In November 2021, the Trachealator product received FDA approval, allowing the Company to enter the U.S. market. Recognizing the lack of established sales channels and infrastructure, management made a strategic investment by partnering with Innovative Outcomes, a distributor with a robust network. To facilitate this investment, the Company entered into a revolving credit facility of up to $750,000, which Innovative Outcomes would use to enhance its distribution capabilities while also supporting our operational efforts in this new territory.

This arrangement was not part of the Company’s normal course of business but rather a targeted investment activity aimed at market entry. However, during the quarter ending November 30, 2023, a significant change in strategic focus necessitated a reassessment of this partnership. The Company identified the need to market its products to niche surgical units, while Innovative Outcomes opted to concentrate solely on the wound care clinic market. This strategic misalignment prompted the decision to separate the developed network and infrastructure, allowing each entity to pursue its respective goals.

In accordance with U.S. GAAP ASC 310, the Company has determined that a full impairment of the note receivable from Innovative Outcomes is warranted. This decision is based on several critical factors:

• Deterioration of Financial Position: The financial position of Innovative Outcomes has deteriorated significantly, raising concerns about its ability to meet future obligations, including the repayment of the note. • Strategic Misalignment: The divergence in strategic focus between the Company and Innovative Outcomes has adversely impacted their relationship. This misalignment has hindered collaborative efforts, reducing the likelihood of successful recovery. • Lack of Access to Information: The Company has been unable to obtain sufficient information to conduct a comprehensive assessment of the recoverability of the loan. This lack of transparency further compounds the uncertainty surrounding the receivable.

• Strategic Misalignment: The divergence in strategic focus between the Company and Innovative Outcomes has adversely impacted their relationship. This misalignment has hindered collaborative efforts, reducing the likelihood of successful recovery.

• Lack of Access to Information: The Company has been unable to obtain sufficient information to conduct a comprehensive assessment of the recoverability of the loan. This lack of transparency further compounds the uncertainty surrounding the receivable.

Given these circumstances, the Company recognized a full impairment reserve against the receivable as of November 30, 2023, along with all accrued interest to date. This decision reflects a commitment to accurate financial reporting and a conservative approach to asset valuation, ensuring that the financial statements present a true and fair view of the Company’s financial position. In September 2024, the full note became due and Innovative Outcomes has defaulted on the note based on non-payment.

As the loan incurs interest and has fixed repayment terms, the Company views this as an investment activity rather than a regular operational endeavor. Nonetheless, Innovative Outcomes remains liable for repayment, and interest will continue to accrue until maturity. Should payments be received, the provision will be reversed in alignment with the corresponding cash flow.

~~8. Loans Payable~~F-18

a. Loans from related parties

	August 31, 2024 $			February 29, 2024 $
Minoan Medical Proprietary Limited
Opening balance		1,769,688			1,862,793
Interest		85,468			236,873
Received/Issued		905,534			2,076,257
Repayments		(1,705,898	)		(2,323,089	)
Foreign exchange difference		116,462			(83,326	)
Closing balance		1,171,254			1,769,688
Minoan Capital Proprietary Limited
Opening balance		269			273
Foreign exchange difference		10			(4	)
Closing balance		279			269
Total debt		1,171,533			1,769,957

F-19

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7. Loans Payable

a. Loans from related parties

	November 30, 2024 (unaudited) $			February 29, 2024 $
Minoan Medical Proprietary Limited
Opening balance		1,769,688			1,862,793
Interest		116,955			236,873
Received/Issued		935,986			2,076,257
Repayments		(1,883,214	)		(2,323,089	)
Foreign exchange difference		101,398			(83,326	)
Closing balance		1,040,813			1,769,688

Minoan Capital Proprietary Limited
Opening balance		269			273
Foreign exchange difference		8			(4	)
Closing balance		277			269

Total debt		1,041,090			1,769,957

Minoan Medical Proprietary Limited:

Loans payable include an unsecured ~~loan~~ loan of $1,~~171~~040,~~254~~813 from Minoan Medical, the prior parent entity of DISA Medinotec in South Africa. This loan was initially obtained to ~~support~~ support the working capital and capital expenditure expansions of DISA Medinotec during its developmental and startup phases. Following the acquisition of DISA Medinotec on March 2, 2022, the Company assumed this liability.

The Company is obligated to repay ~~the~~ the loan within three years following its initial public offering (IPO), which is defined in the loan agreement as the point at which ~~the~~ the business growth is sufficient to list on a national exchange. National exchanges in the United States include the New York Stock Exchange (NYSE), NASDAQ, and NYSE American. During this three-year period, the loan will accrue interest at the prevailing prime lending rate. As of ~~August~~November 3130, 2024, the prevailing lending rate in South Africa was 11.7525%. The terms of this loan are considered to be market-related. The Minoan Medical loan decreased by $94130,~~861~~441 during the quarter ending ~~August~~November 3130, 2024.

The interest charged for the quarter was $3731,~~244~~487 and a 1% movement in the interest rates constitutes a value of $2,~~928~~602. In light of the absence of current major merger and acquisition (M&A) activity, management has decided to prioritize the repayment of loan accounts using spare cash flows generated by the business. This strategic decision aims to strengthen the Company’s financial position and enhance financial stability. By reducing outstanding debt, the Company seeks to improve its leverage and overall financial position, positioning itself for future growth opportunities.

The Company has the option to make early settlement in cash or any form of equivalent.

Minoan Medical Proprietary Limited’s (“Minoan”) ultimate beneficial owner is the CEO of the Medinotec Group of Companies, Dr. Gregory Vizirgianakis. Minoan used to hold his medical investments and exports of which DISA Medinotec Proprietary Limited was one of these investments before it was transferred into the Medinotec Group of Companies. Pieter van Niekerk, the Company’s Chief Financial Officer, also serves as a director of Minoan.

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Minoan Capital Proprietary Limited:

This is an unsecured, interest-free loan with no fixed terms of repayment.

Minoan Medical and Minoan Capital are related parties of the Group as the CEO Dr Gregory Vizirgianakis has common control.

98. Accounts payable and accrued expenses

a. Accounts payable by period

Accounts payable consist of the following:

	August 31, 2024 $		February 29, 2024 $
	November 30, 2024 (unaudited) $		February 29, 2024 $
Trade accounts payable		1996,~~342,555~~702		588,640
Accrued payroll, payroll taxes and leave pay		2621,~~639~~896		11,684
Provision for professional fees		—		92,000
Royalties payable		1222,~~171~~640		35,139
Tax Liability		~~155~~330,~~416~~839		53,646
Other payables		—74,674		20,441
Total		1,~~536~~446,~~781~~751		801,550

One major European Cardiac ~~supplier~~ supplier constituted 5882% of the total trade accounts payable as of ~~August~~November 3130, 2024.

~~F-20~~9. Commitments

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10. Commitments

a. Leases and deferred rent

The Company leases offices which includes warehouse spaces under a cancelable operating lease agreement with contractual terms from August 1, 2023 to July 31, 2026. The Company is required to pay property taxes, insurance, and normal maintenance costs for certain of these facilities and will be required to pay any increases over the base year of these expenses on the remainder of the Company’s facilities.

Rental expense for operating leases for the three months ended ~~August~~November 3130, 2024 was $8,~~130~~ 310 compared to $7,~~970~~797 for the period ended ~~August~~November 3130, 2023, and $1524,~~923~~ 233 and $1523,~~853~~ 650 for the ~~six~~nine months ending ~~August~~November 3130, 2024 and ~~August~~November 3130, 2023 respectively.

Lease cost associated with operating leases is charged to general and administrative expenses in our consolidated financial statements. The exercise of lease renewal options is at our sole discretion. No extension period has been included in the determination of the right of use asset or the lease liability, as we concluded that it is not reasonably certain that we would exercise such option.

~~Maturities of our operating lease liability as of August 31, 2024 was as follows:~~F-20

	Amounts
Remainder of 2025		15,606
2026		31,211
2027		13,005
Total undiscounted lease payments:		59,822
Less: Imputed Interest		(3,615	)
Total operating lease liabilities		56,207
Operating lease liabilities, current portion		27,753
Operating lease liabilities, net of current portion		28,454

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Maturities of our operating lease liability as of November 30, 2024 was as follows:

	Amounts
Remainder of 2025		8,120
2026		31,211
2027		13,005
Total undiscounted lease payments:		52,336
Less: Imputed Interest		(3,388	)
Total operating lease liabilities		48,948

Operating lease liabilities, current portion		28,217
Operating lease liabilities, net of current portion		20,731

b. Litigation

From time to time, the Company may become involved in various legal proceedings in the ordinary course of its business and may be subject to third-party infringement claims.

In the normal course of business, the consolidated entities may agree to indemnify third parties with whom it enters into contractual relationships, including customers, lessors, and parties to other transactions with the Consolidated entities, with respect to certain matters. The Consolidated entities has agreed, under certain conditions, to hold these third parties harmless against specified losses, such as those arising from a breach of representations or covenants, other third-party claims that the Group’s products when used for their intended purposes infringe the intellectual property rights of such other third parties, or other claims made against certain parties. It is not possible to determine the maximum potential amount of liability under these indemnification obligations due to the Consolidated entities limited history of prior indemnification claims and the unique facts and circumstances that are likely to be involved in each claim.

At the reporting date and to the Company’s knowledge, there is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our Company or any of our subsidiaries, threatened against or affecting our Company, our common stock, any of our subsidiaries or of our Company’s or our Company’s subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.

~~F-21~~10. Stockholders' equity

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11. Stockholders' equity

a. Authorized and issued stock by period

Authorized:

As of ~~August~~November 3130, 2024, the Company ~~had~~ had 200,000,000 shares of common stock authorized, par value $.001 per share, with 188,266,250 shares available to issue for purposes of of satisfying conversion of preferred stock, the exercise and future grant of common stock options, and for purposes of any future business acquisitions and other transactions.

As of ~~August~~November 3130, 2024, the Company ~~had~~ had 20,000,000 shares of preferred stock authorized, par value $.001 per share, and available to issue. There are no shares of preferred stock outstanding or designated by the board of directors.

This has remained unchanged from the previous financial year ending February 29, 2024.

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Issued and outstanding shares of common stock:

Common shares		~~August~~November 3130, 2024 $				February 29, 2024 $
Stock issued			11,733,750				11,733,750

Amount of shares		~~August~~November 3130, 2024 units				February 29, 2024 units
Common shares			11,734				11,734

1211. Income taxes

For the three months ended ~~August 31,~~November 30, 2024, and 2023, our provision for income taxes was an expense of $~~110~~171,~~681~~163 and $1263,~~300~~022, respectively, and $~~210~~418,~~837~~383 for the ~~six~~nine months ending ~~August~~ 31November 30, 2024 compared to $1262,~~300~~483 for the ~~six~~nine months ending ~~August~~November 3130, 2023.

The effective tax rate for these periods was 2736% and 3915% for the 3 months ended ~~August~~November 3130, 2024 and 2023 respectively, and 3438% for the ~~six~~nine months ending ~~August 31~~November 30, 2024 compared to ~~107~~14% for the ~~six~~nine months ending ~~August~~November 3130, 2023.

The effective tax rate is impacted by several factors, including:

	1.	National, Federal and State Tax Rates: The statutory federal income tax rate is 21% for the United States and 27% for South Africa, compared to the effective tax rates disclosed above.
	2.	Permanent Differences: Certain items that are recognized in financial statements but are not taxable or deductible in the current period, such as relevant permanent differences specifically not allowed or which is capital in nature relating to the specific segments tax laws, impact our effective tax rate.
	3.	Temporary Differences: Timing differences between the recognition of income and expenses for tax purposes versus financial reporting purposes also contribute to the effective tax rate. Examples include depreciation methods, deferred tax assets/liabilities.
	4.	Tax Credits: Tax credits which may reduce our overall tax liability for the period.
	5.	Changes in Tax Legislation: Any recent changes in tax laws that may have affected our calculations, including will be taken into account.
	6.	Valuation Allowances: We evaluated the need for a valuation allowance on deferred tax assets based on our assessment of future taxable income.

This effective tax rate may differ from the statutory rate due to the aforementioned factors. We will continue to monitor our effective tax rate and make necessary adjustments as required by changes in our operations or tax legislation.

The effective tax rate for the three months ended ~~August~~November 3130, 2024, differed from the U.S. statutory federal income tax rate of 21% primarily due to permanent differences, which include GILTI (Global Intangible Low-Taxed Income) and foreign rate differentials. For the three months ended ~~August~~November 3130, 2023, ~~the~~ the effective tax rate also differed from the U.S. statutory federal income tax rate due primarily to foreign rate differentials.

As a U.S.-registered company with interests in South African entities, we are also considering our obligations under the OECD's Pillar II framework, which seeks to ensure that multinational enterprises pay a minimum level of tax. This framework informs our tax strategy and the management of our global tax liabilities. The tax rate in the territory of South Africa is 27% at the moment which is more than the 21% threshold in the U.S.

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1312. Transactions with related parties

Name	Relationship with the Medinotec Group of Companies	Related transactions with the Medinotec Group of Companies	Related Directors with the Medinotec Group of Companies	Related Owners with the Medinotec Group of Companies
Minoan Medical Proprietary Limited	Medical investment company controlled by Dr Gregory Vizirgianakis	Related Party Loan	Dr Gregory Vizirgianakis Pieter van Niekerk	Dr Gregory Vizirgianakis is the ultimate beneficial owner
Minoan Capital Proprietary Limited	Property investment company controlled by Dr Gregory Vizirgianakis	Related party loan Rental Expenses	Dr Gregory Vizirgianakis is the ultimate beneficial owner	Dr Gregory Vizirgianakis is the ultimate beneficial owner
Medinotec Capital Proprietary Limited	The African holding company of the Medinotec Group of Companies	Related party loan payable to Minoan Capital	Dr Gregory Vizirgianakis Pieter van Niekerk(Resigned Sept 1, 2024)	Medinotec Incorporated in Nevada is the 100% ultimate parent entity
DISA Medinotec Proprietary Limited	The African operating and manufacturing company	Related party loan with Minoan Medical Operational income and expenses with Minoan Medical	Dr Gregory Vizirgianakis Pieter van Niekerk	Medinotec Incorporated in Nevada is the 100% ultimate parent entity
Medinotec Incorporated Nevada	Ultimate parent of Medinotec Capital and DISA Medinotec	All of the above for its related subsidiaries	Dr Gregory Vizirgianakis Pieter van Niekerk Joseph P Dwyer Stavros Vizirgianakis Athanasios Spirakis	This is the entity owned by the shareholders and primarily controlled by Dr Gregory Vizirgianakis and his Brother Stavros Vizirgianakis
Medinotec Group of Companies	The Consolidated group name of Medinotec Incorporated, Medinotec Capital Proprietary Limited and DISA Medinotec Proprietary Limited	All of the above for its related subsidiaries	Dr Gregory Vizirgianakis Pieter van Niekerk Joseph P Dwyer Stavros Vizirgianakis Athanasios Spirakis	This is the entity owned by the shareholders and primarily controlled by Dr Gregory Vizirgianakis and his Brother Stavros Vizirgianakis

F-23

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Pieter van Niekerk	Chief financial officer of the Medinotec Group of Companies	Transactions relating to mutual entities disclosed above	Related directorships disclosed above	Minority Shareholder in Medinotec Inc
Gregory Vizirgianakis	Chief Executive officer of the Minoan Group of Companies Brother of Stavros Vizirgianakis	Transactions relating to mutual entities disclosed above	Related directorships disclosed above	Shareholder in Medinotec Inc and Kingstyle investments.
Stavros Vizirgianakis	Non-Executive director of the Medinotec Group of companies Brother of Gregory Vizirgianakis	Transactions relating to mutual entities disclosed above	No Related other Directorships in Medinotec Group of Companies	n/a
Joseph Dwyer	Non-Executive director of the Medinotec Group of companies	Transactions relating to mutual entities disclosed above	No Related other Directorships in Medinotec Group of Companies	n/a
Athanasios Spirakis	Independent director of the Medinotec Group of companies	Transactions relating to mutual entities disclosed above	No Related other Directorships in Medinotec Group of Companies	n/a

a. Rent

DISA Medinotec Propriety Limited leases commercial buildings from Minoan Capital. Minoan Capital is owned 100% by the Chief Executive Officer of the Medinotec Group of Companies, Dr. Gregory Vizirgianakis. Pieter van Niekerk, CFO of the Medinotec Group of Companies, also serves as a director on Minoan Medical Proprietary Limited (Resigned Sept 1,2024). We are currently also renting storage and office space in the US on a 12-month lease agreement.

Rental expense for operating leases for the quarter ended ~~August~~November 3130, 2024 was $8,~~130~~310 compared to $7,~~970~~797 for the quarter ended ~~August~~November 3130, 2023, and $1524,~~923~~233 for the ~~six months~~nine months ending ~~August~~November 3130, 2024 compared to $1523,~~853~~650 for the ~~six~~nine months ending ~~August~~November 3130, 2023.

F-24

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Set forth below is a table showing the Consolidated entities' rent paid for the quarter ended ~~August~~November 3130, 2024 with Minoan Capital:

Three months ended (unaudited)

~~Six~~Nine months ended (unaudited)

August 31,

November 30,

2024 $

2023 $

2024 $

2023 $

Rent expense

8,~~130~~310

7,~~970~~797

1524,~~923~~233

1523,~~853~~650

Accounts payable

—

Rent is comparable to rent charged for similar properties in the same relative area. The company does market research of a Minimum and a Maximum rental value within the area at every renewal of the rental agreement to ensure this is market related, this exercise is undertaken together with a registered property agent who has the appropriate knowledge of the area.

b. Loan

As of ~~August~~November 3130, 2024 the Company has an unsecured loan payable of $1,~~171~~040,~~254~~813 from Minoan Medical, the prior parent entity of DISA Medinotec Proprietary Limited, which is incorporated in South Africa. This loan was originally obtained to finance working capital and capital expenditure (capex) expansions of DISA Medinotec during its developmental and startup phases.

The consolidated entities, particularly Medinotec Inc., have the option to settle this loan earlier in cash or in any equivalent form. The terms of the loan stipulate that it is to be repaid within three years following the initial public offering (IPO) or upon the commencement of trading on a recognized ~~national~~ national exchange for example NASDAQ, whichever occurs first. During this three-year period, the loan will accrue interest at the prevailing prime lending rate, which was 11.7525% as of ~~August~~November 3130, 2024.

The terms of this loan are considered to be market-related, reflecting conditions that are customary for similar arrangements.

14. Subsequent events

In accordance with ASC 855-10, we have analyzed events and transactions that occurred subsequent to ~~Aug~~November 3130, 2024 through the date these financial statements were issued and have ~~identified~~determined ~~the~~that ~~following~~we ~~event:~~do Innot ~~September~~have ~~2024,~~any ~~the~~other ~~full~~material ~~note~~subsequent ~~receivable~~events ~~from~~to ~~Innovative Outcomes~~disclose ~~became~~or ~~due.~~recognize ~~The~~in ~~company~~these ~~has defaulted on the note based on non-payment. A full impairment reserve has been recognized on this note so no adjustments to the~~ financial statements ~~are required~~. ~~Refer to note 8 above.~~

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

This quarterly report contains forward-looking statements. Forward-looking statements are projections of events, revenues, income, future economic performance or management’s plans and objectives for our future operations. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled “Risk Factors” and the risks set out below, any of which may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. These risks include, by way of example and not in limitation:

•

the uncertainty of profitability based upon our history of losses;

•

legislative or regulatory changes concerning cardiac devices and therapies;

•

risks related to our outstanding loans and our ability to service debt;

•

risks related to our operations and uncertainties related to our business plan and business strategy;

•

changes in economic conditions;

•

uncertainty with respect to intellectual property rights, protecting those rights and claims of infringement of other’s intellectual property;

•

competition; and

•

cybersecurity concerns.

This list is not an exhaustive list of the factors that may affect any of our forward-looking statements. These and other factors should be considered carefully, including those contained in our Annual Report on Form 10-K under “Risk Factors” for the year ended February 29, 2024, and readers should not place undue reliance on our forward-looking statements. Forward looking statements are made based on management’s beliefs, estimates and opinions on the date the statements are made, and we undertake no obligation to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

Our financial statements are stated in United States dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles.

Business Overview

Medinotec Inc. established Medinotec Capital Proprietary Limited as a wholly owned subsidiary in South Africa. In March 2022, Medinotec Capital successfully acquired DISA Medinotec Proprietary Limited after demonstrating the feasibility of a private placement of at least $3 million. This acquisition formed the Medinotec Group of Companies, a South African-based medical device manufacturing and distribution entity.

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The Company engages in in-house manufacturing for products that leverage its intellectual know-how, while also utilizing cash flows generated from marketing products as distribution partners with major players in the industry. This distribution business supports the cash flows of the internally developed products while a market is being established for these offerings. Our internally developed products include:

The Trachealator

In 2018, DISA Medinotec Proprietary Limited developed its most innovative product to date – the Trachealator. This award-winning (Medical Design Excellence Awards – Gold Winner 2021) balloon catheter was developed to address an unmet supply need in the specialty of advanced airway management, more specifically tracheal dilation. That makes this innovative product in our opinion a world first in its ability to dilate a patient’s airway while maintaining ventilation to the patient without obstructing his/her airway.

This life-saving device has quite literally changed the way that tracheal and, to a degree, bronchial stenosis, is managed in extremely ill patients. This is especially true in a post Covid-19 world where tracheal stenosis due to extended tracheal intubation is becoming an ever more frequent pathology encountered by surgeons, who, thanks to the Medinotec Group of Companies, now have a safe and effective tool at their disposal.

The Medinotec Group of Companies is currently in management’s opinion considered a global leader in tracheal non-occlusive airway dilation technology. This belief of management was formed on the fact that there are a number of airway dilation balloons that are offered for the management of tracheal stenosis, but to our knowledge all of them are occlusive in nature. The fact that the Trachealator is a non-occlusive airway solution, allowing for continuous ventilation during dilation, results in management believing that we could be regarded as a global leader in this technology.

Other products manufactured by The Medinotec Group of Companies include:

Aortic Valve Dilation Balloon Catheter (Developmental)

The Aortic Perfusion and Dilation Catheter is a non-occlusive perfusion balloon to allow the expansion of the aortic valve without impeding the cardiac output.

It is currently in the mid stages of research and development. This catheter could potentially be used to post dilate the artificial valve in TAVI (Transcatheter Aortic Valve Implantation) without the need for pacing.

A clinical study was conducted in 2022, as part of the development of the Technical File documentation, which is currently undergoing examination by our Notified Body (DEKRA).

FDA clearance via the 510(k) substantially equivalence process is currently under review, with the application being submitted on the 31^st of May 2024.

The Micro CTO Catheter (Developmental)

We have developed a highly specific niche CTO (Chronic Total Occlusion) catheter balloon range with diameters of 0.70 to 1.25 mm, as a size range extension to the current Cape Cross Rx PTCA Balloon Catheter.

These micro-balloon catheters address an extremely specific market need for difficult coronary cases and will further cement our position as one of the premier specialized coronary balloon catheter manufacturers. The Technical File was submitted to our Notified Body at the end of July 2023 and is currently undergoing examination.

The process of obtaining FDA clearance for the full range of Cape Cross PTCA catheters via the 510(k) substantial equivalence process commenced in January 2024 and the expected submission date is February 2025.

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The Tracheal Stent (Developmental)

We are currently in the initial stages of development of a new self-expanding, temporary, silicone tracheal stent to be used in conjunction with the Trachealator balloon in the treatment of tracheal stenosis.

The complimentary nature of this product will further build on our know-how in the field of advanced airway management.

The following distinct and finite developmental phases / stages are applicable to all our product pipeline, namely:

R&D

Pre-production prototyping

Testing

Production

Clinical trials

MDR/CE Mark accreditation

Local marketing & selling

International sales outside the US

FDA 510 (k) approval

10)

Sales to the United States.

The products described have reached the following stages:

	Trachealator:	The Company is pleased to report that, since sales commenced, it has supplied ~~501~~940 Update Trachealators, both in private and academic hospitals throughout the United States of America. FDA clearance and CE registration was obtained.
	Cape Cross PTCA Catheter:	Application for FDA 510(k) clearance in progress with external consultants. Final submission pending. CE certification has been obtained.
	Cape Cross NC Catheter:	Application for FDA 510(k) clearance in progress with external consultants. Final submission pending. CE certification has been obtained.
	Lamprey Suction Dissector:	The progress of this product's development has been temporarily suspended to prioritize the pursuit of products with greater economic viability.
	Aortic Valve Dilation Balloon Catheter (Outflo):	R&D, Testing, Pre-Production Prototyping, Testing, Production, Clinical Trials, Application for MDR CE Mark Accreditation has been submitted. Application for FDA 510(k) clearance was submitted on the 31st of May 2024.
	Micro CTO Catheter:	R&D, Testing, Pre-Production Prototyping, Clinical Trials MDR/CE Mark accreditation application was submitted in July 2023.
	Tracheal Stent:	R&D
	Epistaxis Catheter:	R&D, Testing, Pre-Production Prototyping, Testing, Production, Clinical Trials – FDA 510(k) exempted (Class I product)

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Results of Operations for the Three and ~~Six Months~~Nine Months ended ~~August~~November 3130, 2024 and ~~August~~November 3130, 2023

Revenue

Quarterly Performance

For the quarter ended ~~August~~November 3130, 2024, consolidated revenue for the Medinotec Group of Companies reached $12,~~804~~565,~~020~~048, an increase from $~~350~~2,~~792~~002,547, a growth of ~~414~~28%.

Year-to-Date Performance

For the ~~six~~nine months ending ~~August~~November 3130, 2024, consolidated revenue was $35,~~055~~588,~~897~~445, compared to $~~766~~2,~~999~~769,547 in the corresponding period of the previous year, an increase of ~~298~~102%.

Operating Segments

The Group operates through two primary segments: Sales Outside the United States and Domestic Sales. These segments represent the core of our business, with the former covering both in-house developed products and complementary products distributed on behalf of third parties, and the latter focusing on our proprietary Trachealator product within the United States.

1. Sales ~~outside~~Outside the United States: ~~Includes~~ This segment includes both the sale of the Group's in-house developed products (proprietary IP) and ~~complementary~~the distribution of third-party products. The third-party distribution component generally yields thinner margins due to pricing pressures, distributor agreements, and competition within the ~~latter~~medical ~~typically~~device ~~yielding~~distribution ~~thinner~~sector. However, the in-house products provide higher margins, driven by the value proposition of our proprietary technologies.

Domestic Sales: Focused on our Trachealator product within the United States.

	○	The performance of this segment is strongly influenced by regional demand, regulatory considerations, and the success of our distributor partnerships, particularly in regions such as South Africa and broader Southern Africa.
	○	Industry Trends: According to Grand View Research, the global medical device market is expected to grow at a CAGR of 5.6% from 2024 to 2029, driven by rising healthcare expenditures, demographic shifts, and a growing need for medical devices in emerging markets. This trend supports the Group’s growth strategy for expanding our footprint in these markets and capitalizing on the increasing demand for both proprietary and third-party products.

Domestic Sales (United States)
The Domestic Sales segment primarily focuses on our Trachealator product, which serves the respiratory market in the U.S. This product is a leading solution for tracheal stenosis, and we continue to see significant adoption within key healthcare institutions across the country.

	○	Revenue from this segment is primarily driven by increasing market penetration of the Trachealator, aided by favorable clinical outcomes, strategic sales channels, and strong relationships with U.S. healthcare providers. The U.S. market remains our second-largest by revenue, after South Africa, and continues to show robust growth potential as demand for respiratory solutions rises, particularly in the wake of heightened awareness and treatment focus of respiratory diseases.
	○	Industry Trends: The U.S. medical device market is projected to grow at a CAGR of 4.3% from 2024 to 2029, according to IBISWorld, driven by advances in minimally invasive technologies and increasing health spending. With an aging population and rising incidences of chronic respiratory conditions, the demand for innovative solutions such as the Trachealator is expected to continue to rise, benefiting the Group’s domestic sales efforts.

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Sales Concentration

Sales between the Medinotec Group and ~~DISA~~ DISA Life Sciences are expected to remain strong, ~~due~~driven toby DISA'’s well-established and extensive distribution network in South Africa. ~~However,~~This ~~the~~partnership ~~Group~~continues ~~aims~~ to ~~diversify and~~be ~~reduce~~a ~~its~~key ~~reliance~~pillar onof our revenue stream, particularly within the ~~South~~Sales ~~African~~Outside ~~market~~the asUnited weStates ~~pursue~~segment, where ~~opportunities~~South inAfrica ~~more~~represents ~~developed~~a ~~international~~significant ~~markets~~portion of our sales.

~~Despite~~However, ~~this~~as ~~intention,~~part ~~there~~of isour nobroader ~~certainty~~growth ~~that~~strategy, ~~our~~the ~~efforts~~Group ~~will~~is ~~successfully~~committed ~~diminish~~to ~~our~~reducing ~~dependency~~its reliance on ~~DISA~~the ~~Life~~South ~~Sciences~~African ~~for~~market ~~customer~~by ~~accounts.~~diversifying ~~Expansion~~into ~~efforts~~more ~~face~~developed ~~potential~~international ~~barriers,~~markets. ~~including~~We ~~regulatory~~aim ~~approvals~~to expand our footprint in regions such as North America, Europe, and ~~competition~~select other promising markets, which ~~may~~present ~~hinder~~significant opportunities ~~our~~for ~~entry~~growth ~~into~~and ~~these~~greater ~~new markets~~stability. ~~Consequently~~The Group’s proprietary products offer strong potential in these regions, particularly in the ~~risk~~U.S. ~~of customer~~and ~~concentration~~European ~~may~~markets, ~~persist~~where ~~unless~~demand wefor ~~effectively~~advanced ~~navigate~~minimal ~~these~~invasive ~~challenges~~medical devices is increasing.

Despite these efforts, there is no certainty that we will be able to significantly reduce our dependency on DISA Life Sciences for customer accounts in the short-to-medium term. Expansion into new markets comes with inherent risks, including the need for regulatory approvals, the challenge of building new distribution networks, and the competitive landscape in each region. These factors may delay or impede our ability to diversify successfully. As such, the risk of customer concentration will likely persist unless we are able to effectively address these challenges and build a more balanced and diversified revenue base.

Product Development

The Trachealator product received FDA clearance in November 2021, ~~enabling~~allowing the Company to market and sell this innovative product inwithin the United States. ~~Among~~This ~~Medinotec's most valuable assets are~~regulatory ~~its~~milestone ~~long-term~~is ~~customer~~a ~~relationships~~significant ~~and~~achievement, ~~robust~~as ~~distribution~~it ~~and~~not ~~marketing~~only ~~network.~~expands ~~Our~~the ~~distribution~~product's ~~partnership~~reach ~~boasts~~to ~~over~~a ~~100~~larger ~~sales representatives~~and ~~who~~more ~~cover~~developed ~~approximately~~market ~~60%~~but ofalso ~~hospital~~strengthens the ~~theatre floors in South Africa weekly. The~~ Group’s ~~plans~~position ~~to replicate this successful model~~ in the highly competitive U.S. ~~market~~medical device landscape.

~~The~~Among ~~following~~Medinotec’s ~~table~~most ~~sets~~valuable assets ~~forth~~are ~~total~~its ~~revenue~~long-term bycustomer ~~operating~~relationships, as well as its robust distribution and marketing network. These factors have played a ~~segment~~key role in the success of the ~~total~~Group’s ~~revenue~~operations, ~~balance:~~particularly in South Africa, where our distribution partnership is supported by a team of over 100 sales representatives. This dedicated sales force covers approximately 60% of hospital theatre floors in South Africa on a weekly basis, ensuring that our products are consistently visible and accessible to key medical professionals. This successful distribution model has been pivotal in driving adoption and product penetration.

	Three months ended (unaudited)				Six months ended (unaudited)
	August 31,		August 31,		August 31,		August 31,
	2024 $		2023 $		2024 $		2023 $
Outside United States of America
Cape Cross NC Catheter		16,058		60,983		47,673		103,211
Cape Cross PTCA Catheter		36,905		54,109		63,721		99,392
Trachealator Catheter		225,256		120,200		306,277		265,236
Components		2,091		6,126		5,898		14,866
Distribution revenue		1,360,728		—		2,333,572		—
		1,641,038		241,418		2,757,141		482,705
Inside United States of America
Trachealator Catheter		162,982		109,374		298,756		284,294
Total Company Sales		1,804,020		350,792		3,055,897		766,999

The Group now plans to replicate this proven model in the U.S. market, leveraging the FDA clearance of the Trachealator and the strength of our established sales force. This expansion into the U.S. is an important step in our strategy to build a broader, more diversified revenue base and to tap into the significant growth opportunities within the North American healthcare market.

7Additionally, the Group has recently submitted the Aortic Dilation Balloon Catheter for FDA 510(k) clearance on May 31, 2024. If clearance is obtained, this product will become the Group's second FDA-approved offering in the North American market. The approval and subsequent launch of this product will further expand Medinotec’s portfolio and bolster its presence in the competitive cardiovascular market in North America, a key area of strategic growth.

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The following table sets forth total revenue by operating segment of the total revenue balance:

	Three months ended (unaudited)				Nine months ended (unaudited)

	November 30,		November 30,		November 30,		November 30,
	2024 $		2023 $		2024 $		2023 $
Outside United States of America
Cape Cross NC Catheter		20,950		48,816		68,623		150,565
Cape Cross PTCA Catheter		29,470		37,840		93,191		135,162
Trachealator Catheter		95,299		214,851		401,576		505,820
Components		5,196		225,012		11,095		217,679
Distribution revenue		2,199,199		1,344,803		4,500,271		1,344,803
		2,350,114		1,871,322		5,074,756		2,354,029

Inside United States of America
Trachealator Catheter		214,934		131,225		513,689		415,518
Total Company Sales		2,565,048		2,002,547		5,588,445		2,769,547

Outside the U.S. Segment

Revenues from the Group’s Outside the U.S. segment, which ofincludes both our ~~products sold~~proprietary ~~outside~~and ~~the~~distributed ~~United~~products, ~~States~~showed substantial growth for the three and ~~six~~nine months ended ~~August 31~~November 30, 2024,. Revenues increased by ~~580~~26% and ~~471~~116%, respectively, reaching $12,~~641~~350,~~038~~114 for the three-month period and $25,~~757~~074,~~141~~756 for the nine-month period, compared to $~~241~~1,~~418~~871,322 and $~~482~~2,~~705~~354,029 for the same periods in the prior year. ~~The~~This ~~increase in~~growth ~~revenues~~ was primarily driven by the addition of new distribution revenue ~~lines~~streams in South Africa and ~~enhanced~~increased sales ~~and marketing~~ efforts for our in-house developed products.

~~However,~~Our ~~there~~sales ~~have~~of ~~been~~components ~~volume~~are ~~drops~~opportunistic in ~~sales~~nature, oftypically ~~our~~occurring ~~internally~~when ~~designed~~we ~~and~~face ~~manufactured~~over-supply ~~products~~situations inor ~~the~~when ~~Outside~~stock ~~the~~is ~~U.S.~~approaching ~~segment~~expiration. ~~This~~These ~~decline~~sales isare ~~largely~~a ~~attributable~~strategy to avoid writing off excess inventory, which arises due to the ~~significant~~minimum stock purchase quantities required by our suppliers for the manufacturing line. In the ~~time~~nine ~~and~~months ~~attention~~ended ~~being~~November ~~focused~~30, on2024, component sales significantly declined, dropping from $217,679 to $11,095 compared to the Usame period in the prior year.S. ~~market~~Similarly, asfor ~~well~~the asthree ~~market~~months ~~constraints~~ended ~~stemming~~November 30, 2024, component sales fell from ~~macroeconomic~~$225,012 ~~factors~~to $5,196. This decline reflects the absence of similar over-supply or near-expiration situations that were present in ~~Europe~~the previous year.

~~Our~~Despite the overall increase in revenues, we have observed a decline in sales volume for some of our internally designed and ~~marketing~~manufactured ~~initiatives~~products in this segment. This drop is largely due to the ~~included:~~Group's strategic focus on expanding the U.S. market, which has diverted significant resources and attention. Additionally, macroeconomic factors in Europe, including economic slowdown and currency fluctuations, have created market constraints that have impacted product sales in certain regions.

1. Strategic Partnerships: We established new distribution agreements with key partners in South Africa, leveraging their established networks to enhance our market penetration. 2. Sales Training: We implemented comprehensive training programs for our sales representatives, focusing on product knowledge and effective sales techniques to better engage healthcare professionals. 3. Targeted Marketing Campaigns: We launched tailored marketing campaigns highlighting the unique benefits of our products, which included digital marketing, trade shows, and direct outreach to healthcare facilities. 4. Customer Relationship Management (CRM): We invested in CRM tools to better track customer interactions, allowing for tailored approaches that strengthen relationships with healthcare providers. 5. Market Research: Ongoing research was conducted to identify emerging trends and customer needs, enabling us to refine our offerings and marketing strategies accordingly.9

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Our sales and marketing initiatives in this segment aimed to counter these challenges and drive growth. These efforts included:

	1.	Strategic Partnerships: We successfully established new distribution agreements with key partners in South Africa, leveraging their established networks to enhance our market penetration and expand the reach of our products across both public and private healthcare systems. This partnership has played a pivotal role in increasing sales in the region and strengthening our market presence.
	2.	Sales Training and Development: A critical component of our sales strategy involved the implementation of comprehensive training programs for our sales representatives. These programs focused on improving product knowledge, refining sales techniques, and equipping our team with the tools to better engage healthcare professionals. By investing in our salesforce, we aim to enhance product adoption and foster stronger relationships with healthcare providers.
	3.	Targeted Marketing Campaigns: We launched tailored marketing campaigns that highlighted the unique benefits of our products to healthcare professionals. These campaigns utilized a mix of digital marketing, trade shows, and direct outreach to hospitals and healthcare facilities. These efforts were designed to raise awareness and drive demand for our products, particularly in emerging markets.
	4.	Customer Relationship Management (CRM): To further strengthen our customer engagement, we invested in CRM tools to better track and manage customer interactions. This has enabled us to deliver personalized communications and follow-up, improving customer satisfaction and fostering long-term relationships with key healthcare providers.
	5.	Market Research and Trends Analysis: Ongoing market research was conducted to identify emerging trends, shifting customer needs, and competitive landscape changes. This research has informed our product development and marketing strategies, ensuring that our offerings remain aligned with market demand and that we continue to deliver value to our customers.

Inside the U.S. Segment

Revenues from the Group’s U.S. segment, which includes sales of our in-house developed products ~~sold~~, ~~inside~~increased ~~the~~by ~~United~~64% ~~States~~and 24% for the three and ~~six~~nine months ended ~~August~~November 3130, 2024, ~~increased by 49.0% and 5.1%,~~ respectively, ~~totaling~~ totaling $~~162~~214,~~982~~934 for the three-month period and $~~298~~513,~~755,~~689 ~~compared~~for the nine-month period. This compares to $~~109~~131,~~374~~225 and $~~284~~415,~~294~~518 for the same periods in the prior year. ~~This~~The revenue growth was primarily ~~attributable~~driven toby intensified sales and marketing efforts ~~focused~~aimed onat ~~our~~increasing ~~in-house~~the visibility ~~developed~~and adoption of our proprietary products.

Key initiatives in this segment ~~included~~that contributed to the growth include:

1. Expanded Sales Force: We significantly increased the number of sales representatives dedicated to the U.S. market, ~~enhancing~~enabling ~~our~~us ~~ability~~ to better engage ~~more~~with healthcare providers ~~effectively~~and expand our reach across key hospital systems and clinics. 2. Promotional Activities: We organized targeted promotional events and product demonstrations in ~~key~~major hospital ~~systems~~networks, todirectly ~~showcase~~showcasing our products ~~directly~~ to potential customers and increasing product awareness in critical healthcare settings. 3. Educational Initiatives: WeTo support product adoption, we launched educational programs ~~aimed~~for at healthcare professionals, ~~providing~~offering ~~valuable~~detailed information ~~about~~on ~~our~~product ~~products~~benefits and ~~their~~clinical applications ~~in clinical settings~~ through webinars and workshops. These initiatives help establish our products as trusted solutions within the clinical community. 4. Enhanced Online Presence: Our digital marketing ~~strategy~~efforts ~~was~~were ~~revamped to improve online visibility~~enhanced, including optimized website content and targeted online advertising designed to ~~reach~~increase our visibility among healthcare professionals, helping to drive interest and engagement in our products. 5. Feedback and Adaptation: ~~Regular~~We established regular feedback loops ~~were established~~ with our customers to ~~gain~~gather insights into their experiences, ~~allowing~~with our products. This continuous feedback allows us to ~~refine~~adapt our product offerings and sales strategies, ~~continually~~ensuring they align with customer needs and market demands.

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Cost of Goods

The following tables compare cost of goods sold as dollar amounts and as a percent of net sales for the three and ~~six~~nine months ended ~~August~~November 3130, 2024 and 2023:

For the Quarter Ended

For the Six Months Ended

Quarter Ended (unaudited)

Nine Months Ended (unaudited)

August 31, 2024

August 31, 2023

August 31, 2024

August 31, 2023

November 30, 2024

November 30, 2023

November 30, 2024

November 30, 2023

Total cost of goods sold

~~970~~1,~~608~~524,272

601,~~988~~138,628

13,~~622~~113,~~207~~979

$~~159,486~~

1,298,116

For the Quarter Ended

For the Six Months Ended

Quarter Ended (unaudited)

Nine Months Ended (unaudited)

August 31, 2024

August 31, 2023

August 31, 2024

August 31, 2023

November 30, 2024

November 30, 2023

November 30, 2024

November 30, 2023

Total cost of goods sold %

5459

1757

5356

2047

The composition of the cost of sales figure as a % to the segments is as follows

	For the Quarter Ended						For the Six Months Ended
	Quarter Ended (unaudited)						Nine Months Ended (unaudited)
	August 31, 2024			August 31, 2023			August 31, 2024			August 31, 2023
	November 30, 2024			November 30, 2023			November 30, 2024			November 30, 2023
Outside United States of America %		98	%		8797	%		9998	%		7196	%
Inside the United states of America %		2	%		133	%		12	%		294	%

~~Cost~~For ofthe ~~goods~~three ~~sold~~months ~~(COGS)~~ended ~~increased~~November ~~for~~30, 2024, ~~the~~Cost ~~three months~~of ~~ended~~Goods ~~August~~Sold ~~31,~~(COGS) ~~2024~~increased, primarily ~~due~~reflecting to the factors ~~previously~~discussed ~~mentioned~~earlier ~~related~~regarding to the revenue ~~increase~~growth in the period. As ~~Gross~~a result, gross margin as a percentage of sales decreased to 4641%, compared to 8343% in the same quarter of the prior year.

For the ~~six~~nine months ended ~~August~~November 3130, 2024, COGS also ~~increased~~ rose, driven by ~~the~~similar ~~same~~ factors ~~affecting~~impacting revenue. Gross margin asfor athe ~~percentage~~year-to-date ofperiod ~~sales~~ was 4344%, down from 80 53% in the prior year ~~period~~.

~~The~~This decline in gross margin for both the quarter and year-to-date periods can be attributed primarily to a shift in the sales mix, with a higher proportion of distribution product volumes compared to in-house developed ~~product volumes~~products, particularly in the South ~~Africa~~African market. ~~Additionally,~~Distribution itproducts istypically ~~important to note that COGS is significantly~~carry ~~impacted~~thinner bymargins ~~foreign~~than ~~exchange~~our ~~fluctuations.~~proprietary ~~Since~~products, ~~revenues~~which ~~generated~~has ~~outside~~led ofto ~~the~~a ~~U.S.~~decrease ~~segment are predominantly~~ in ~~South~~the ~~African~~overall ~~Rand, which~~gross ~~can be quite volatile, these currency movements materially affect our cost structure~~margin.

Additionally, foreign exchange fluctuations have had a significant impact on COGS. A substantial portion of revenues generated outside of the U.S. is denominated in South African Rand (ZAR), which can be highly volatile. As a result, fluctuations in the exchange rate between the ZAR and U.S. Dollar materially affect our cost structure, contributing to the change in gross margin.

Operating Expenses

~~Operating~~For the quarter ended November 30, 2024, operating expenses were $~~397~~513,~~665~~ 325, down from $606,009 for the ~~quarter~~same period in the prior year. For the nine months ended ~~August~~November 3130, 2024, operating expenses increased to $1,242,098, up from $~~234~~1,~~069~~116,936 for the ~~quarter~~same ~~ended~~period ~~August~~in ~~31,~~the ~~2023~~prior year. ~~Operating~~The ~~expenses were $728,775~~increase for the ~~six~~nine-month ~~months~~period ~~ended~~was ~~August~~primarily ~~31,~~driven ~~2024,~~by upinvestments ~~from~~in ~~$510~~growth initiatives,~~927~~ ~~for~~including ~~the~~sales ~~six~~and ~~months~~marketing ~~ended~~activities, ~~August~~as ~~31,~~well as ~~2023~~higher compliance-related costs.

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One of the major components that affects the operating expenses is the ~~costs~~cost of compliance for the business. which is included in the General and Administrative line item. Certain costs are once off in nature and others will be recurring.

Three months ended (Unaudited)

~~Six~~Nine months ended (Unaudited)

August 31, 2024

August 31, 2023

Value Change

August 31, 2024

August 31, 2023

Value Change

November 30, 2024

November 30, 2023

Value Change

November 30, 2024

November 30, 2023

Value Change

% Change

Operating expenses

Depreciation and amortization expense

19,~~522~~206

1211,~~402~~604

7,~~120~~602

5766%

3756,~~438~~644

2436,~~845~~449

1220,~~593~~195

5155%

General and administrative expenses

~~353~~379,~~808~~217

~~183~~552,~~329~~342

~~170~~(173,~~479~~125

)

93(31%)

~~631~~1,~~014~~010,229

~~399~~951,~~444~~786

~~231.570~~58,443

586%

Research and development expenses

169,~~892~~270

112,~~857~~728

(966,~~965~~542

)

~~(84~~2439%

1686,~~872~~142

1416,~~119~~846

269,~~753~~296

19411%

Sales and marketing expenses

2245,~~443~~632

2639,~~481~~335

(46,~~038~~297

)

~~(15~~16%

4389,~~451~~083

72111,~~519~~855

(2922,~~068~~772

)

(4020%)

Total operating expenses

~~397~~513,~~665~~325

~~234~~606,~~069~~009

~~163~~(92,~~596~~684

)

70(8%)

~~728~~1,~~775~~242,098

~~510~~1,~~927~~116,936

~~217~~125,~~848~~162

4311%

Depreciation and amortization ~~expense~~ expense increased by $7,~~120~~602 for the quarter and $1220,~~593~~195 for the ~~six~~nine months ending ~~August~~November 3130, 2024. This ~~rise~~increase is primarily ~~attributed to~~attributable to the acquisition of new assets and the allocation of depreciation to products manufactured during the period. These assets, which include both equipment and intangible assets, have contributed to the rise in depreciation costs as they are progressively utilized in the production process. Total depreciation for the quarter, including amounts allocated to manufactured products, was $2524,~~309~~892, and $4873,~~537~~429 for the ~~six~~nine-month period ending ~~August~~November 3130, 2024. This allocation reflects the capital investment in our manufacturing operations and is consistent with the company’s efforts to scale production and improve operational efficiency.

General and administrative expenses as a total ~~increased~~decreased by $~~170~~173,~~479~~125 for the quarter and increased by $~~231~~58,~~570~~443 for the ~~six~~nine months ending ~~August~~November 3130, 2024.

The most material causes of these movements are the following:

	•	There was a reclassification of amounts previously included in general and administrative expenses to revenue in the first quarter amounting to $327,950 in the segment outside the United States, excluding this, the line item increased by $154,825 for the three months ended November 30, 2024 and $386,393 for the nine months then ended, the largest contributing component relates to an increase in payroll costs of $6379,~~085~~349 for the three-month period and $~~424~~113,~~550~~387 year-to-date. This increase includes the payroll expenses associated with the new distribution line, reflecting the costs incurred.
	•	The remainder of the increase was due to compliance costs that were incurred.

~~General and administrative expenses per segment is allocated as follows~~12

Quarter Ending August 31	Inside the United States ($)		Outside the United States ($)		Total ($)
	2024	2023	2024	2023	2024	2023
General and administrative expenses	140,727	99,708	213,082	83,621	353,809	183,329

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Six Months Ending August 31	Inside the United States ($)		Outside the United States ($)		Total ($)
	2024	2023	2024	2023	2024	2023
General and administrative expenses	273,123	214,602	357,891	184,842	631,014	399,444

General and administrative expenses per segment is allocated as follows

For the quarter and six months ending August 31, 2024, 48% of the expense increase is attributable to payroll costs in the segment inside the USA, while 34% relates to payroll costs for operations outside the USA, reflecting an increase from 43% year-to-date and 25% in the prior year. The comparative turnover generated by each segment, as a percentage of payroll costs, shows that operations outside the USA accounted for 11%, compared to 20% in the previous six months, while the inside USA segment continues to demonstrate its own strengths.

Quarter Ended November 30 (unaudited)	Inside the United States ($)				Outside the United States ($)				Total ($)
	2024		2023		2024		2023		2024		2023
General and administrative expenses		248,925		191,526		130,292		360,816		379,217		552,342

This data indicates that the company’s strategy of leveraging less expensive, high-quality talent abroad is yielding positive results. This approach not only enhances our cost efficiency but also reinforces our commitment to maintaining a skilled workforce that is essential for driving our operations.

Nine Months Ended November 30 (unaudited)	Inside the United States ($)				Outside the United States ($)				Total ($)
	2024		2023		2024		2023		2024		2023
General and administrative expenses		522,048		336,950		488,181		614,836		1,010,229		951,786

The company’s strategy of leveraging less expensive, high-quality talent abroad is yielding positive results. This approach not only enhances our cost efficiency but also reinforces our commitment to maintaining a skilled workforce that is essential for driving our operations.

The remaining portion of general and administrative expenses is primarily compliance obligations, which are critical for a medical device company operating in a highly regulated market. These costs encompass regulatory filings, quality assurance initiatives, and other compliance measures necessary to meet industry standards. As a publicly traded entity, we also incur specific expenses related to our listing on the OTCQX markets. These expenses cover regulatory compliance, investor relations, and reporting requirements that are vital for maintaining transparency and accountability as a public enterprise. It is important to note that these public-related expenses are specific to our operations within the United States.

Collectively, these factors highlight the significance of stringent compliance and operational readiness within our cost structure, ensuring that we meet both regulatory requirements and the expectations of our stakeholders.

Research and development ~~expenses~~ (R&D) expenses increased by $766,~~120~~542 for the quarter and ~~increased by~~ $269,~~753~~296 for the ~~six~~nine months ending ~~August~~November 3130, 2024. InThis ~~terms~~increase ofreflects ~~capital~~our ~~allocation~~ongoing commitment ~~for~~to ~~research~~enhancing product performance and ~~development~~operational ~~(R&D),~~efficiencies. weWe adopt an R&D-light approach, focusing on commercially viable projects that prioritize higher returns on investment. This strategy ~~focuses~~ensures onthat ~~commercially~~our ~~viable~~resources are allocated to projects, ~~prioritizing~~with a higher likelihood ~~investments~~of ~~that~~success, ~~promise~~minimizing ~~higher~~the ~~returns~~risks associated with long-term, high-cost initiatives. Our R&D efforts are primarily ~~center~~directed on towards process ~~improvement~~improvements and manufacturing efficiencies rather than more speculative, high-risk ~~initiatives~~developments. By ~~opting~~paying ~~to pay~~ R&D royalties and ~~select~~selecting projects that are closer to commercialization, we ~~ensure~~optimize aour ~~higher likelihood~~R&D ofexpenditures ~~success~~ and ~~minimize~~ensure ~~resource~~a ~~allocation~~more topredictable ~~less~~path ~~promising ventures~~to market.

~~Sales~~In ~~and~~Quarter ~~marketing~~3, ~~expenses~~a ~~decreased~~significant investment byof $450,~~038~~000 ~~for~~was ~~the~~made ~~quarter~~to ~~and~~fund ~~$29,068~~an ~~for~~American-based ~~the~~research ~~six~~study ~~months~~led ~~ending~~by ~~August~~a ~~31,~~reputable ~~2024~~surgeon in the United States. This ~~reduction~~study isaims ~~primarily~~to ~~due~~provide valuable clinical insights into the Trachealator product and is expected to ~~our~~bolster ~~increased~~confidence ~~use~~in its performance. We believe that the outcomes of ~~distributors~~this inresearch ~~all~~will ~~territories,~~not ~~which~~only ~~allows~~validate ~~for~~the aproduct's ~~better~~effectiveness ~~alignment~~but ofalso ~~costs~~enhance ~~incurred~~the ~~with~~rollout ~~item~~of ~~sales,~~the asTrachealator ~~opposed~~in tothe ~~maintaining a~~U.S. ~~full-time~~market, ~~staff~~supporting ~~whose~~broader ~~expenses~~adoption ~~can~~and ~~accumulate~~driving ~~over~~growth ~~time~~in ~~relative~~this tokey ~~sales performance~~territory.

WeSales ~~continue~~and tomarketing ~~deliver~~expenses ~~directly~~increased by to$6,297 ~~customers to~~for ~~preserve~~the ~~our~~quarter ~~relationships~~but ~~with~~decreased ~~these~~by ~~customers~~$22,772 ~~and~~for ~~ensure~~the ~~that~~nine wemonths doending ~~not~~November ~~lose~~30, ~~touch~~2024. ~~with~~The ~~our~~reduction ~~clients~~in ~~through~~expenses for the nine-month period is primarily due to our ~~use~~increased ofreliance on distributors ~~especially~~ inacross ~~the~~all ~~United States~~territories. ~~Additionally,~~This ~~this~~strategy ~~decrease~~has ~~can~~allowed befor ~~attributed~~a tobetter alignment of costs with item sales, reducing the ~~timing~~need offor ~~conferences~~a ~~and~~full-time ~~marketing~~staff ~~events~~dedicated ~~attended~~solely to sales activities, whose expenses could accumulate ~~which~~over ~~can~~time ~~create~~without ~~discrepancies~~a ~~when~~direct ~~comparing~~link ~~year-over-year~~to ~~expenses~~sales performance.

For all expense categories it is important to note that we maintain a flat organizational structure that allows for flexibility in staff roles, enabling sales personnel to transition into operational and manufacturing positions, and vice versa. While this adaptability provides us with a competitive advantage, it may impact our quarter-over-quarter and year-over-year comparisons across the various expense categories used for reporting purposes.13

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While we’ve shifted towards a distributor model in many regions, we continue to deliver products directly to customers in order to preserve our strong relationships and ensure that we maintain direct contact with clients, particularly in the U.S. market. This direct engagement remains a priority as it strengthens customer loyalty and provides valuable insights for future product development.

The decrease in sales and marketing expenses can also be attributed to the timing of conferences and marketing events, which can vary from year to year and create discrepancies when comparing expenses across periods.

It is also important to note that our flat organizational structure allows for flexibility in staff roles. Sales personnel are able to transition into operational and manufacturing positions, and vice versa. While this adaptability provides a competitive advantage by allowing us to optimize staff allocation based on business needs, it can lead to variability in quarter-over-quarter and year-over-year comparisons across different expense categories.

Net Income / (Loss)

Net income for the quarter ending ~~August 31~~November 30, 2024, was $~~284~~310,~~749~~311, a significant improvement from a net loss of $33492,~~164~~371 for the same quarter ending ~~August~~November 3130, 2023. For the ~~six~~ nine months ended ~~August~~ 31November 30, 2024, net income was $~~371~~682,~~953~~264, up from a net loss of $10503,~~876~~248 in the corresponding ~~six~~nine-month period of the previous year.

This positive change is primarily attributable to increased sales, as previously discussed.

Included in net income is the contribution to income or loss from operations by segment for the quarter ending ~~August~~November 3130, 2024. This metric is viewed as the most accurate and ~~operationally~~ operationally driven indicator to illustrate the impact of each segment on net income. By focusing on the contribution from operations, we can more clearly assess how each segment performs independently, allowing for a better understanding of their respective efficiencies and profitability. This approach provides valuable insights into the operational health of the business and supports informed decision-making for future strategic initiatives.

Quarter Ending August 31

Inside the United States ($)

Outside the United States ($)

Total ($)

Quarter Ended November 30 (unaudited)

Inside the United States ($)

Outside the United States ($)

Total ($)

~~2024~~

~~2023~~2024

~~2024~~

~~2023~~

~~2024~~

2023

2024

2023

2024

2023

Income/(loss) from operations

~~(5,151)~~

~~(2,657)~~

~~440~~(143,~~898~~628

~~58,392~~)

~~435,747~~

~~55,735~~

(623,558

)

671,079

131,187

527,451

(492,371

)

Six Months Ending August 31

Inside the United States ($)

Outside the United States ($)

Total ($)

Nine Months Ended November 30 (unaudited)

Inside the United States ($)

Outside the United States ($)

Total ($)

~~2024~~

~~2023~~2024

~~2024~~

~~2023~~

~~2024~~

2023

2024

2023

2024

2023

Income/(loss) from operations

~~(27,191)~~

~~34,255~~

~~732~~(170,~~106~~821

~~62,331~~)

~~704,915~~

~~96,586~~

(564,985

)

1,403,189

61,737

1,232,368

(503,248

)

The loss-making nature of the Inside the United States segment, in contrast to the profitability of the segment outside the United States, can be attributed to the differing phases of business maturity. The Inside the USA segment is currently in an active build-up phase, reflecting its less mature status, while the segment outside the USA has reached a more established stage of development.

Furthermore, the Inside the USA territory incurs higher operating and running costs compared to the segment outside the USA. This disparity in expenses provides a competitive advantage for the outside USA segment, where highly skilled South African professionals can be engaged at a lower cost than would be required for similar services within the USA. As a result, the outside USA segment benefits from a more favorable cost structure, contributing to its profitability while the Inside USA segment continues to develop.

~~Liquidity and Capital Resources~~14

As of August 31, 2024, the Company reported current assets of $4,902,075 and total assets of $5,295,834. Current liabilities at the same date were $1,566,122, resulting in working capital of $3,335,953. Compared to February 29, 2024 when current assets were $4,379,297 and total assets were $4,804,279, with current liabilities of $827,453 and working capital of $3,551,844. The growth in total assets reflects strong capital resources closely linked to our recent revenue growth, driven by enhanced sales and marketing efforts in both domestic and international markets. Working capital reduced due to strategic use of current assets to reduce long term liabilities in the form of the related party loan. This was done due to operating in a high interest environment.

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Liquidity and Capital Resources

As of November 30, 2024, the Company reported current assets of $4,920,314 and total assets of $5,362,621. Current liabilities at the same date were $1,474,968, resulting in working capital of $3,445,346. This compares with February 29, 2024 when current assets were $4,379,297 and total assets were $4,804,279, with current liabilities of $827,453 and working capital of $3,551,844. The growth in total assets reflects strong capital resources closely linked to our recent revenue growth, driven by enhanced sales and marketing efforts in both domestic and international markets. Working capital reduced due to strategic use of current assets to reduce long term liabilities in the form of the related party loan. This was done due to operating in a high interest environment – refer to note 7.

We believe that the funds generated from operations, along with our existing cash reserves, will be sufficient to finance our current operations and meet our obligations over the next twelve months. Our operational cash flow is expected to support our activities beyond the next twelve months, although we remain open to exploring additional funding sources as needed for growth initiatives discussed below.

In terms of capital allocation for research and development (R&D), we adopt an R&D-light approach. This strategy focuses on commercially viable projects, prioritizing investments that promise higher returns. Our R&D efforts are primarily centered on process improvement and manufacturing efficiencies rather than high-risk initiatives. By opting to pay R&D royalties and select projects that are closer to commercialization, we ensure a higher likelihood of success and minimize resource allocation to less promising ventures.

Looking ahead, we plan to undertake clinical write-ups in new territories to facilitate market entry and compliance with local regulations. We do not anticipate exceeding $50,000 for these activities, maintaining a disciplined approach to expenses while capitalizing on growth opportunities.

To further support potential acquisitions, strategic partnerships, capital expenditures, and the expansion of our R&D initiatives, we may consider seeking additional debt or equity financing or establishing lines of credit to supplement cash flows from operations. This proactive approach will enable us to leverage our financial position for sustainable growth and innovation.

Cash flow movements

The following table summarizes our cash flows from continuing operations for the periods indicated:

	Six Months Ended August 31, 2024 ($)			Six Months Ended August 31, 2023 ($)
	Nine Months Ended November 30, 2024 (unaudited) ($)			Nine Months Ended November 30, 2023 (unaudited) ($)
Net cash provided by (used in):
Operating Activities		~~645~~779,~~210~~119			~~(281~~101,~~256~~232	)
Investing Activities		(1790,~~733~~359	)		—(851	)
Financing Activities		(~~733~~843,~~871~~555	)		~~260~~(282,~~901~~552	)

Cash flows from Operating Activities

For the ~~six~~nine months ended ~~August~~November 3130, 2024, our operating cash flows experienced a significant turnaround, moving from a ~~negative~~positive cash generation of $~~281~~101,~~256~~232 in the prior ~~period~~ period to a positive cash generation of $~~621~~779,~~255~~119. This notable improvement in operating cash flow can be attributed primarily to enhanced profitability and effective management of working capital.

~~Profitability Improvement~~15

During this period, we reported an increase in net profit after tax of $371,953, compared to a loss of $10,876 in the same period last year. This shift was largely driven by robust sales growth in our Outside the USA segment, specifically within our newly acquired cardiology distribution business, which commenced operations in the third quarter of 2023 in South Arica. The expansion in this segment has been instrumental in driving our revenue upward and enhancing our overall profitability.

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Profitability Improvement

During this period, we reported an increase in profitability with a net profit after tax of $682,264, compared to a loss of $503,248 in the same period last year. This shift was largely driven by robust sales growth in our Outside the USA segment, specifically within our newly acquired cardiology distribution business, which commenced operations in the third quarter of 2023 in South Arica. The expansion in this segment has been instrumental in driving our revenue upward and enhancing our overall profitability.

Working Capital Movements

In addition to the improvement in profitability, the remaining increase in cash generated from operations was influenced by favorable movements in working capital. We effectively managed our trade receivables, inventory, and accounts payable to support the revenue growth in the cardiology distribution business.

• Trade Receivables: WeTrade ~~implemented~~receivables ~~more~~increased ~~efficient~~by ~~collection processes~~$353,323 ~~which~~for ~~resulted~~the innine amonths ~~quicker~~ended ~~turnover~~November of30, ~~accounts~~2024 ~~receivable~~compared to an increase of $55,156 ~~contributing~~for ~~positively~~the tosame ~~our~~period ~~cash~~in ~~flows~~the previous year, directly resulting from increased revenues. • Inventory Management: We optimized our inventory levels to align with increased demand, ensuring that we maintain sufficient stock without overcommitting resources. Inventories increased by $234,558 for the nine months ended November 30, 2024 compared to a decrease of $357,977 for the same period in the previous year. • Accounts Payable: We strategically managed our payables, taking advantage of favorable payment terms to maintain liquidity while supporting our growth objectives. Accounts payable and accrued expenses increased by $285,442 for the nine month period ended November 30, 2024 compared to an increase of $263,291 for the same period in the previous year.

Furthermore, the company's ability to maintain strong relationships with suppliers and customers is critical in ensuring a steady flow of cash. Our commitment to direct customer engagement, even as we utilize distributors, helps preserve these relationships, facilitating smoother transactions and improved cash flow stability.

Overall, the combination of increased profitability, operational efficiencies, effective management of payment timing, and strong supplier relationships has positioned us well to enhance our cash flows from operating activities. We remain committed to sustaining this positive momentum as we continue to expand our market presence and drive growth in our key business segments.

Cash flows from Investing Activities

For the period ending ~~August~~November 3130, 2024, we reported aan ~~decrease~~increase in net cash used in investing activities of $1190,~~787~~359, compared to ~~zero~~$851 in the prior period. The cash flows used in investing activities relate to the purchase of property, plant and equipment.

Cash flow from Financing Activities

For the ~~six~~nine months ending ~~August~~November 3130, 2024, we reported a use of cash from financing activities of $~~704~~843,~~672~~555, compared with cash ~~generated~~used of $~~260~~282,~~901~~552 in the prior period ending ~~August 31~~November 30, 2023. This change was primarily driven by the repayment of a portion of the related party loan during the current period, compared with the previous period, which included proceeds from long-term debt that contributed to higher cash inflows from the same loan facility.

The repayment of the related party loan is indicative of our improved financial stability and a commitment to reducing leverage, which represents a positive development for the business. By lowering our debt obligations, we enhance our balance sheet, reduce interest expenses, and position ourselves for better cash flow in the long term. This proactive management of debt not only strengthens our financial position but also enhances our financial flexibility, allowing us to allocate resources more effectively toward growth initiatives, operational improvements, and strategic investments.

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Additionally, the decrease in reliance on external financing to fund operations suggests that our core business activities are generating sufficient cash flow. This transition reflects a healthier financial foundation and fosters greater confidence among investors and stakeholders regarding our sustainability and growth prospects.

Overall, we believe these developments underscore our strategic focus on long-term value creation and position us favorably for future growth opportunities.

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Off Balance Sheet Arrangements

As of ~~August~~November 3130, 2024, there were no off-balance sheet arrangements.

Critical Accounting Policies

In December 2001, the SEC requested that all registrants list their most “critical accounting polices” in the Management Discussion and Analysis. The SEC indicated that a “critical accounting policy” is one which is both important to the portrayal of a company’s financial condition and results, and requires management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. There have been no material changes to our critical accounting policies as described in the footnotes to our financial statements included in our annual report on Form 10-K for the year ended February 29, 2024; however, we consider our critical accounting policies to be those related to revenue from the revenue of self-manufactured products, revenue from the distribution of products, allowance for note receivable impairment, and inventories valuation, costing and obsolescence.

Recently Issued Accounting Pronouncements

The Company does not expect the adoption of recently issued accounting pronouncements to have a significant impact on the Company’s Consolidated results of operation, financial position or cash flow.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Not applicable

Item 4. Controls and Procedures

Disclosure Controls and Procedures

We conducted an evaluation, with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act, during the period ended ~~August~~November 3130, 2024, to ensure that information required to be disclosed by us in the reports filed or submitted by by us under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities Exchange Commission’s rules and forms, including to ensure that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that during the period ended ~~August~~November 3130, 2024, our ~~disclosure~~ disclosure controls and procedures were not effective.

Changes in Internal Control over Financial Reporting

No change in our system of internal control over financial reporting occurred during the period covered by this report i.e. the period ended ~~August~~November 3130, 2024, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II – OTHER INFORMATION

Item 1. Legal Proceedings

We are not a party to any material pending legal proceedings. We are not aware of any pending legal proceeding to which any of our officers, directors, or any beneficial holders of 5% or more of our voting securities are adverse to us or have a material interest adverse to us.

Item 1A: Risk Factors

In addition to the other information set forth in this Quarterly Report on Form 10-Q, carefully consider the risk factors described under the heading “Part I – Item 1A. Risk Factors” in our most recent Annual Report on Form 10-K for the fiscal year ended February 29, 2024. Such risks described are not the only risks facing us. Additional risks and uncertainties not currently known to us, or that our management currently deems to be immaterial, also may adversely affect our business, financial condition, and/or operating results. There have been no material changes to those risk factors since their disclosure in our most recent Annual Report on Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None

Item 3. Defaults upon Senior Securities

None

Item 4. Mine Safety Disclosure

Not applicable

Item 5. Other Information

None

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Item 6. Exhibits

	Exhibit Number		Description of Exhibit
	31.1		Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
	31.2		Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
	32.1		Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

	EX-101.INS**		XBRL Instance Document

	EX-101.SCH**		XBRL Taxonomy Extension Schema Document

	EX-101.CAL**		XBRL Taxonomy Extension Calculation Linkbase

	EX-101.DEF**		XBRL Taxonomy Extension Definition Linkbase

	EX-101.LAB**		XBRL Taxonomy Extension Labels Linkbase

	EX-101.PRE**		XBRL Taxonomy Extension Presentation Linkbase

** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

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SIGNATURES

In accordance with the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Medinotec, Inc.
Date: October 15, 2024
Date: January 14, 2025
	By:	/s/ Gregory Vizirgianakis
		Gregory Vizirgianakis
	Title:	Chief Executive Officer and Principal Executive Officer

	Medinotec, Inc.
Date: October 15, 2024
Date: January 14, 2025
	By:	/s/ Pieter van Niekerk
		Pieter van Niekerk
	Title:	Chief Financial Officer, Principal Financial Officer and Principal Accounting Officer

1819

Filing Compare · Medinotec Inc.