Annual report
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Microba Life Sciences Limited Appendix 4E Preliminary final report 1. Company details Name of entity: Microba Life Sciences Limited ABN: 82 617 096 652 Reporting period: For the year ended 30 June 2026 Previous period: For the year ended 30 June 2025 2. Results for announcement to the market $ Revenues from ordinary activities down 5.8% to 14,758,461 Loss from ordinary activities after tax attributable to the owners of Microba Life Sciences Limited up 38.7% to (20,721,356) Loss for the year attributable to the owners of Microba Life Sciences Limited up 38.7% to (20,721,356) Dividends There were no dividends paid, recommended or declared during the current financial period. Comments The loss for the Group after providing for income tax amounted to $20,721,356 (30 June 2025: $14,939,471). 3. Net tangible assets Reporting period Previous period Cents Cents Net tangible assets per ordinary security 0.18 1.57 4. Control gained over entities Not applicable. 5. Loss of control over entities Not applicable. 6. Dividends Current period There were no dividends paid, recommended or declared during the current financial period. Previous period There were no dividends paid, recommended or declared during the previous financial period. 7. Dividend reinvestment plans Not applicable.
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Microba Life Sciences Limited Appendix 4E Preliminary final report 8. Details of associates and joint venture entities Not applicable. 9. Foreign entities Details of origin of accounting standards used in compiling the report: Not applicable. 10. Audit qualification or review Details of audit/review dispute or qualification (if any): The financial statements have been audited and an unmodified opinion has been issued. 11. Attachments Details of attachments (if any): The Annual Report of Microba Life Sciences Limited for the year ended 30 June 2026 is attached. 12. Signed Signed ___________________________ Date: 31 August 2026 Pasquale Rombola Chair Brisbane Aut horised for release by the Board.
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Microba Life Sciences Limited Corporate directory 30 June 2026 1 Directors Pasquale Rombola Ian Frazer Gene Tyson Jacqueline Fernley Stéphane Chatonsky Executive Key management personnel Luke Reid (Chief Executive Officer) James Heath (Chief Financial Officer) Company secretary James Heath Registered office and Microba Life Sciences Limited principal place of business Level 10 324 Queen Street Brisbane QLD Australia Share register Automic Pty Ltd Level 35 477 Collins Street Melbourne VIC Australia Auditor Pitcher Partners Level 38 345 Queen Street Brisbane QLD Australia Solicitors Thomson Geer Level 28 1 Eagle Street Brisbane QLD Australia Stock exchange listing Microba Life Sciences Limited shares are listed on the Australian Securities Exchange (ASX code: MAP) Website www.microba.com Corporate Governance Statement The Company's corporate governance statement is located at the Company's website: ir.microba.com/corporate-governance/
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4 Expect Better www.microba.com
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5 Contents 01 Performance highlights 06 02 Chair, Deputy Chair & CEO Letter 10 03 Operating & Financial Review 13 04 Directors’ Report 29 05 Financial Statements 45 06 ASX Additional Information 96
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6 Performance Overview Total revenue with legacy phase-out complete $14.8M Testing revenue growth +92% Number of tests sold (Core test) 22,418 Gross margin, held through transition 47.6% Deferred revenue $1.8M Cash at 30 June 2026 $7.9M ANNUAL REPORT 2026 6
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7 Performance Overview Core tests sold by quarter FY26 Revenue transition ($M) Deferred revenue ($M) up 66% Underlying loss after tax ($M) ANNUAL REPORT 2026 7 Underlying loss is a non-IFRS measure; refer to the reconciliation in the Operating and Financial Review.
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8 Completed the strategic transition to a focused core testing business • Twelfth consecutive quarter of core testing growth: cor e testing revenue up 92% to approximately $8.6 million, now the majority of Group revenue, with an exit run-rate above 25,000 tests per annum. • Continuing produc t revenue grew 53% to $12.7 million while discontinued legacy revenue reduced 72%, completing the planned phase-out and providing a clean revenue base entering FY27. Record volumes in Australia and a scaling enterprise-clinic channel • Microba Microbiome Explorer™ delivered a r ecord Q4 of 5,311 tests, up 54% versus the prior corresponding period (PCP), with 901 ordering clinicians and orders per clinician up 34%. • 43 enterprise-clinic accounts signed since Nov ember 2025, selling 5,606 tests, with a key-account pipeline above 175 targets representing estimated ordering potential above 80,000 tests per annum. United Kingdom • Record Q4 of 825 tests, up 92% versus PCP, with 313 ac tive ordering clinicians, up 85%. Own-brand supplements building recurring revenue • PHGG prebio tic fibre unit sales more than doubled to 43,000 units, and the Invivo subscription offering surpassed 1,000 subscribers within its first year. ANNUAL REPORT 2026 Performance Highlights
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9ANNUAL REPORT 2026 Clinical evidence and product leadership • Microba MetaPanel™ clinical validation published in Fr ontiers in Cellular and Infection Microbiology, reporting greater than 99% median specificity and 91% median sensitivity. • The Phase 1 trial of lead therapeutic asset MAP-315 in ulcera tive colitis was provisionally accepted for publication in Nature Communications. • Microba GI Na vigator, a new category-defining test powered by the Company’s proprietary Clinical Logic Engine, is on track to launch in October 2026, with the first 35 sales achieved through an early-access program with opinion- leading practitioners across Australia and the United Kingdom. A structurally lower cost base and strengthened capital position • Total operating expenditure down 7% to $29.9 million; cos t-streamlining program targeting approximately $7 million per annum of reductions, fully implemented in H1 FY27, supported by AI deployed across customer support, engineering, science and other corporate function teams. • Gross equity proceeds of $13.0 million during FY26 and a further $0.8 million shortly after year end, with strategic partner Sonic Healthcare Limited (ASX: SHL) subscribing for $4.1 million during FY26 placements. • Underlying loss improved 11% to $18.8 million (statutory loss $20.7 million).
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10 Microba.comMicroba.com Microba.com MICROBA LIFE SCIENCES LIMITED | ANNUAL REPORT 2026 01 Chair, Deputy Chair & CEO Letter
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11 11 CHAIR, DEPUTY CHAIR & CEO LETTER We remain steadfast in our belief that the human gut microbiome represents one of the biggest untapped opportunities to improve human health, and that microbiome testing will become a routine part of clinical care. FY26 was a defining year for Microba. We removed a range of legacy testing products and services to set the business up around core testing products designed for scale, completed a multi-year product and infrastructure build, and raised the capital to complete the path to cash flow break-even for the whole company. Core testing is now the majority of Group revenue, having been under a third of it two years ago, and we enter FY27 as a clean, focused business with a structurally lower cost base and Microba GI Navigator ready to launch. Microba is creating a new diagnostic category in clinical microbiome testing. Category creation takes time, and our strategy is to de-risk it through a structured, region-by-region market development process aligned to the clinician adoption curve. In Australia, adoption moved beyond innovator clinicians into early adopters during FY26, increasingly characterised by enterprise agreements with healthcare clinics. Australia and the United Kingdom remain the markets in which we are focused and invested. We guided during FY26 to core test volumes above 24,000 and to regional break-even in Australia and the United Kingdom by the end of the year, measured on a regional EBITDA basis. Solid progress was made towards these ambitious targets. Volumes reached 22,418, growth of 78% on FY25 and within 7% of the level guided, and regional break-even was not achieved within the year. The enterprise-clinic channel that now underpins our growth began contracting accounts in November 2025, and those accounts were still maturing at year end. Q4 was a record quarter and a strong finish that carries real momentum into FY27. We exited the year at an annualised run-rate above 25,000 tests, and core testing revenue grew 92% across the year, the Dear Shareholders, compounding result of consistent, disciplined execution as we move up the adoption curve with clinicians in both markets. The statutory loss for the year increased to $20.7 million, from $14.9 million in FY25, primarily reflecting non-cash and non-recurring items in both periods. Excluding those items the underlying loss improved 11%, on operating expenditure down 7%, reflecting disciplined cost management through the year. The Operating and Financial Review sets out the detail and the reconciliation. Microba’s mission to improve human health through microbiome science remains our driving force. During FY26 we continued to demonstrate the clinical utility of our testing, with MetaPanel’s clinical validation published in Frontiers in Cellular and Infection Microbiology and the Phase 1 trial of our lead therapeutic asset MAP-315 in ulcerative colitis provisionally accepted for publication in Nature Communications. Microba GI Navigator, a new category-defining testing product powered by our proprietary Clinical Logic Engine, launches in October 2026. It is the culmination of several years of leadership at the forefront of this new diagnostic category, and it opens our serviceable addressable market to more medical doctors, a significant next segment of the healthcare practitioner market for our tests. GI Navigator is already live with a closed-group early access cohort of opinion-leading practitioners across Australia and the United Kingdom, with the first 35 sales achieved. In therapeutics, six positive sector readouts between November 2025 and July 2026 delivered the efficacy data in chronic disease that prospective partners had been waiting to see. The modality has now been validated. We commenced a formal partnering campaign from July 2026, supported by our Boston-based advisors, with no further research and development investment and our core intellectual property preserved, providing a capital-light path from here. During the year the Company received an inbound approach from a UK-based private equity fund and, after extensive due diligence, agreed in-principle
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12 12 CHAIR, DEPUTY CHAIR & CEO LETTER terms, subject to conditions including shareholder approval, for the divestment of our Diagnostics and Supplements businesses at a consideration that would have exceeded the Company’s market capitalisation. The consideration did not change; the final structure did, and when it was no longer in the best interests of shareholders we chose not to proceed. We then moved to secure funding certainty ahead of the Microba GI Navigator launch, completing a $5.0 million placement in June 2026 in which Sonic Healthcare, our largest shareholder and strategic partner, subscribed for $1.5 million. The placement was led by our substantial shareholders investing above their pro rata entitlements, and we are grateful for their support through two capital raisings during the year, and for Sonic’s continued confidence in Microba. Looking ahead, our immediate priorities are clear: launch Microba GI Navigator, grow core testing volumes in Australia and the United Kingdom through the maturing enterprise-clinic channel, realise the full benefit of the cost reductions now in place, and advance our therapeutics partnering campaign. With the core product and platform build substantially complete, our focus in FY27 moves to commercialisation. Together these priorities are directed at a single objective, achieving whole company cashflow break-even, on a run-rate basis, in calendar year 2027, building a self-sustaining business. During the year, as part of the Board’s renewal, Mr Richard Bund and Dr Hyungtae Kim resigned on 19 November 2025 after more than six years of service, and we thank them sincerely for their contribution. Mr Stéphane Chatonsky joined as an Independent Non-Executive Director on 20 November 2025, bringing over 25 years of experience across healthcare, pathology and technology investment. On behalf of the Board, we thank Microba’s employees and partners for their hard work and dedication through a demanding year. We also extend our gratitude to our shareholders for their continued support and belief in Microba’s vision. Yours sincerely, Mr Pasquale Rombola Chair Prof. Ian Frazer (AC) Deputy Chair Dr Luke Reid Chief Executive Officer
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13 Microba.comMicroba.com Microba.com MICROBA LIFE SCIENCES LIMITED | ANNUAL REPORT 2026 02 Operating & Financial Review
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14 14 OPERATING & FINANCIAL REVIEW This Operating and Financial Review forms part of, and should be read in conjunction with, the Directors’ Report and the audited financial statements for the year ended 30 June 2026. The financial year ending 30 June 2026 was a year of transition and consolidation for Microba Life Sciences, marked by the completion of the portfolio shift to core testing, the strongest year of core test growth in the Company’s history, and a structurally lower cost base. Financial review 1.Underlying loss is a non-IFRS measure; refer to the reconciliation below. The statutory comparison is affected by one-off items in both years, and the operating cash flow comparison by R&D Tax Incentive receipt timing ($3.1 million received in FY26 versus $6.3 million in FY25). Revenue Revenue from contracts with customers was $14.76 million, down 6% on FY25 ($15.67 million), entirely attributable to the planned phase-out of discontinued legacy products. Continuing product revenue grew 53% to $12.7 million, while discontinuing product revenue reduced 72% to $2.1 million. From Q3 FY26 onwards, reported revenue was no longer affected by legacy roll-off. Core testing revenue grew 92% year-on-year to approximately $8.6 million and represented approximately 62% of Q4 FY26 revenue, up from 31% in Q3 FY25. Core testing volume reached 22,418 tests, up 78% on the 12,629 tests sold in FY25, with the Company exiting FY26 at a rolling-quarter annualised run-rate above 25,000 tests. SUMMARY OF FINANCIAL PERFORMANCE FY26 FY25 CHANGE Total revenue ($m) 14.8 15.7 (6%) Continuing product revenue ($m) 12.7 8.3 +53% Gross margin (%) 47.6 47.5 +0.1pp Total expenses ($m) 29.9 32.2 (7%) Underlying loss after tax ($m) 1 (18.8) (21.2) 11% improved Statutory loss after tax ($m) (20.7) (14.9) (39%) Net operating cash outflow ($m) (12.4) (12.0) (5%) Cash at 30 June ($m) 7.9 11.7 (32%)
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15 15 OPERATING & FINANCIAL REVIEW Consistent with Australian Accounting Standards, testing revenue is recognised when the final report is delivered rather than when a kit is ordered and paid for. Microba Microbiome Explorer™ deferred revenue grew 66% to $1.79 million at 30 June 2026, a leading indicator of core testing revenue expected to be recognised in FY27 that grew faster than reported revenue during the year. Recognition of that balance depends on patients returning samples for analysis, and a portion of kits sold is not returned. Performance against FY26 guidance At the FY25 results, and in the FY25 Annual Report, the Company guided to core test volume growth of more than 100% year-on-year, core test volumes above 24,000, and regional break-even in both Australia and the United Kingdom by the end of FY26. Regional break-even was defined on a regional EBITDA basis, excluding corporate costs, product development expenditure and share-based payments, and was forecast to be achieved at test volumes above 24,000 split across the two regions. Substantial progress was made towards these objectives, although they were not fully achieved within FY26. Core test volumes grew 78% to 22,418, within 7% of the guided volume, and regional break-even was not achieved by 30 June 2026. The shortfall reflects the timing of the enterprise-clinic channel ramp described above, which commenced in November 2025 with signed accounts still maturing at year end. At the June 2026 equity raising, the Company replaced the regional break-even measure with a whole-company objective, which is achieving cashflow break-even, on a run-rate basis, in calendar year 2027. The new objective is a broader and more demanding measure, as it includes corporate and product development expenditure that the FY26 objective of regional break-even excluded, and it is supported by the cost reduction program and the revenue and margin drivers set out in this review.
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16 16 OPERATING & FINANCIAL REVIEW Gross profit and margin Gross profit was $7.03 million at a gross margin of 47.6% (FY25: $7.44 million and 47.5%). Margin was held broadly stable through the transition year, with the exit of lower-margin distributed and legacy products and growth in own-brand supplements offsetting the revenue mix shift. During the year the Company consolidated its laboratory footprint to achieve economies of scale through its Brisbane based laboratory, revised logistics pathways and made improvements to the kit which improved unit economics with FY27 now set to build on these foundations and to see strong further expansion in both gross profit and gross margins as core testing volumes scale. Operating expenditure Total expenses reduced 7% to $29.92 million (FY25: $32.23 million), reflecting the Q1 FY26 restructuring, the laboratory consolidation, the pause in internal therapeutic development and disciplined cost management, partly offset by a deliberate 79% increase in marketing investment directed at core testing growth and by the non-cash items below. 1. The impairment of $0.75 million relates to testing kit technology associated with the discontinued Invivo EcologiX product range, written down to nil following the Group’s decision to exit the product. EXPENSES FY26 $M FY25 $M CHANGE Employee benefits and related costs 14.35 16.49 (13%) Depreciation and amortisation 4.41 4.43 (0.4%) Other expenses 2.96 3.09 (4%) Consulting fees 1.84 3.42 (46%) Subscriptions and information technology 1.65 1.28 +29% Net foreign currency loss (non-cash) 1.51 - n/a Marketing and advertising 1.18 0.66 +79% Impairment of intangibles 1 0.75 - n/a Research and development 0.42 2.01 (79%) Travel, legal, finance costs and other 0.85 0.84 +1% Total expenses 29.92 32.23 (7%)
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17 17 OPERATING & FINANCIAL REVIEW Statutory result and underlying performance The Group recorded a statutory net loss after tax of $20.72 million (FY25: $14.94 million) and a basic loss per share of 3.45 cents (FY25: 3.33 cents). The statutory comparison is significantly affected by non-cash and non-recurring items in both periods: FY25 included a $4.47 million gain on derecognition of contingent consideration and a $1.76 million foreign currency gain, whilst FY26 included a $1.51 million foreign currency loss, a $0.75 million impairment, and a $0.36 million fair value gain on a derivative financial liability. Adjusting for these items, the underlying loss improved 11% year-on-year. 1. Underlying loss is a non-IFRS measure presented to assist shareholders in understanding the performance of the business, is unaudited, and has been prepared consistently for both periods. Cash flow and capital management Receipts from customers were $15.59 million (FY25: $16.95 million), reflecting the legacy revenue phase-out. Net cash used in operating activities was $12.37 million (FY25: $12.01 million), the cashflow comparison is significantly affected by R&D Tax Incentive receipts of $3.06 million in FY26 against $6.31 million in FY25, and excluding grant receipts in both years the underlying operating outflow improved by approximately $2.7 million. The Q4 FY26 operating outflow was 38% below Q4 FY25 on a structurally reduced cost base. Investing outflows of $3.80 million principally comprised $3.67 million of intangible asset payments reflecting the platform build and the development of Microba GI Navigator, which are now substantially complete. The Company completed two equity raisings during FY26 for gross proceeds of $13.0 million, approximately $8.5 million settled in July 2025 completing the June 2025 two-tranche placement, and Tranche 1 of approximately $4.5 million (before costs) of the June 2026 placement at $0.05 per share, in which strategic partner and shareholder Sonic Healthcare Limited (ASX: SHL) subscribed for $1.5 million (before costs) after subscribing for $4.16m in the June 2025 capital raising. During FY26 the Group drew approximately $2.05 million under its Radium Capital R&D Tax Incentive financing arrangements (advances FY26 R&D claim). This was partly offset by $0.67 million of principal repayments on the insurance premium funding (fully repaid during the year) and the equipment finance facility, giving net proceeds from borrowings of $1.39 million. STATUTORY TO UNDERLYING RECONCILIATION FY26 $M FY25 $M Statutory loss after income tax (20.72) (14.94) Impairment of intangibles 0.75 - Net foreign currency loss / (gain) 1.51 (1.76) Fair value gain on derivative financial liability (0.36) - Gain on derecognition of contingent consideration - (4.47) Underlying loss after income tax1 (18.83) (21.17)
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18 18 OPERATING & FINANCIAL REVIEW During FY26, following an inbound approach by a UK-based private equity fund, the Company agreed in-principle terms, subject to conditions precedent including shareholder approval, for the divestment of its Diagnostics and Supplements businesses at a consideration that would have exceeded the Company’s market capitalisation. When the final deal structure was no longer in the best interests of shareholders, the Company chose not to proceed. Cash and cash equivalents were $7.95 million at 30 June 2026, and the Company had 700,307,489 fully paid ordinary shares on issue. Going concern and funding The financial statements have been prepared on a going concern basis. The Group incurred a loss of $20.72 million for the year and a net cash outflow from operating activities and lease repayments of $13.31 million, and held cash and cash equivalents of $7.95 million at 30 June 2026. In reaching the going concern conclusion, the Directors had regard to the Group’s demonstrated ability to raise capital and the support of its major shareholders, its continued reliance on the R&D Tax Incentive scheme, its ability to scale back discretionary expenditure to preserve liquidity, and the measures implemented to streamline operations to a lower cost base with the objective of achieving full group cashflow break-even in calendar year 2027. As set out in the financial statements, in the event these initiatives do not materialise as planned, a material uncertainty exists that may cast significant doubt on the Group’s ability to continue as a going concern. After assessing forecast cash flows for the twelve months from the date of the report, the Directors concluded there are reasonable grounds to expect the Group will continue as a going concern. Post balance date events On 24 July 2026, shareholders approved the issue of the Tranche 2 placement shares, the share purchase plan shares and attaching options at an Extraordinary General Meeting. On 29 July 2026 the Company issued 8,659,785 Tranche 2 placement shares at $0.05 per share raising approximately $0.4 million before costs, and 8,150,000 share purchase plan shares at $0.05 per share raising approximately $0.4 million before costs, together with 100,004,240 unlisted attaching options exercisable at $0.0625 and expiring three years from issue. On 26 August 2026, the Company announced that it is in preliminary, non-binding discussions with Genetic Signatures Limited (ASX: GSS) regarding a potential merger of the two businesses. The discussions are at an early stage and remain incomplete. No binding agreement has been entered into, no firm decision to proceed has been made by either party, and there is no certainty that any transaction will proceed or as to its terms. Any transaction would be subject to further due diligence and all required regulatory and other approvals. As the discussions are preliminary and incomplete, any financial effect cannot be reliably estimated. No other matter or circumstance has arisen since 30 June 2026 that has significantly affected, or may significantly affect, the Group’s operations or state of affairs. Dividends No dividends were paid, recommended or declared during the current or previous financial year.
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19 19 OPERATING & FINANCIAL REVIEW Review of Operations & Activities Diagnostics Microba is creating a new diagnostic category in clinical microbiome testing. The Company estimates a future addressable market of $125 billion per annum across seven major markets and 10 indication groups, within which its defined total addressable market is approximately $25 billion per annum, and its serviceable addressable market approximately 18.6 million tests per annum across five focus markets. The Company is derisking this category creation through a structured, region-by-region market-development process aligned to the clinician adoption curve. In Australia, adoption has moved beyond innovators into early adopters, increasingly characterised by enterprise-style contracts with healthcare clinics, in the United Kingdom, clinical testing progressed through the innovator phase with strong adoption signals. Five pillars underpin the growth model, large-scale latent demand, efficient product-accelerated growth engines, essential clinical utility, recurring and sticky revenue, and powerful moats built on proprietary measurement methods, bioinformatics intellectual property, accreditation and a growing clinical-grade dataset. . Five pillars driving durable, scalable, AI-powered growth 001 002 003 Large-scale latent demand Growing clinical evidence is driving acceptance of the microbiome. Clinicians and patients are ready to adopt clinical-grade solutions they can trust. Efficient growth engines A product-accelerated growth model — self-serve signup, always-on funnels, automated lifecycle marketing, AI support — scales beyond a 1:1 sales force. Essential clinical utility A technically rich, self-describing report delivers clear insights and actions, making microbiome testing usable without specialist training. 004 005 Recurring, sticky revenue A technology-led experience supports clinicians and patients from referral to adherence, owning the relationship, lowering CAC and lifting lifetime value. Powerful moats Proprietary measurement methods, bioinformatics IP, accreditation and a growing clinical-grade dataset compound into durable competitive advantage.
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20 20 OPERATING & FINANCIAL REVIEW AUSTRALIA: MICROBA MICROBIOME EXPLORER™ Microbiome Explorer delivered successive record quarters through FY26, closing with 5,311 tests in Q4, up 54% versus PCP, an ordering-clinician base of 901 and orders per clinician up 34% versus PCP. The shift to enterprise-style clinic accounts changed the shape of the business in FY26 with 43 accounts signed from November 2025, together selling over 5,600 tests and representing estimated ordering potential above 24,000 tests per annum, with the broader key-account pipeline exceeding 175 targets and estimated ordering potential above 80,000 tests per annum. This channel supports accelerating revenue, improved sales efficiency and a more predictable, recurring revenue base as accounts mature, while increasing customer concentration and extending payment terms.
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21 21 OPERATING & FINANCIAL REVIEW UNITED KINGDOM: MICROBA MICROBIOME EXPLORER™ FY26 was the first full year of UK market access. Building on the Invivo Healthcare customer base, adoption continued to track ahead of the Australian curve at the equivalent time post launch, with a record Q4 of 825 tests, up 92% versus PCP, and 313 active ordering clinicians, up 85%. Essentials and Extended variants were introduced into the UK market and broadened the range, and all legacy UK testing products were discontinued during the year. MICROBA METAPANEL™ In partnership with Sonic Healthcare, focus remained on gastroenterology specialists and key opinion leaders, with 225 tests sold in Q4 FY26 and full-year volumes broadly stable. Clinical validation published in Frontiers in Cellular and Infection Microbiology (greater than 99% median specificity, 91% median sensitivity) is expected to support routine adoption over time. PRODUCT DEVELOPMENT DRIVING CLINICIAN ADOPTION Through FY26 Microba released features advancing clinical utility and workflow integration, including the Oral Species biomarker, Practitioner Pays, Pay on Invoice, simplified sampling, and the v1.5 sampling kit with lower component costs. Microba GI Navigator, a new category-defining testing product, is on track to launch in October 2026. It is the culmination of several years of leadership at the forefront of this new diagnostic category and represents a meaningful leap in the clinical application of complete microbiome and gut testing. GI Navigator is designed for the Company’s core target patient population, being the significant proportion of people living with an unresolved gastrointestinal disorder, and is a premium product in the category expected to command premium pricing. It is expected to open up the serviceable addressable market to more medical doctors, a significant next segment of the healthcare practitioner market for Microba’s tests. Powered by the Company’s proprietary Clinical Logic Engine, GI Navigator is live with a closed-group early access cohort of opinion-leading practitioners across Australia and the United Kingdom, with the first 35 sales achieved and multiple parts of the product already delivering clinical value and receiving positive feedback.
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22 22 OPERATING & FINANCIAL REVIEW SUPPLEMENTS AND INTERNATIONAL PARTNERSHIPS Own-brand Invivo supplement revenue grew to $0.75 million in Q4 FY26, up 11% versus PCP, led by PHGG prebiotic fibre with unit sales more than doubling to 43,000 units, while the subscription offering surpassed 1,000 subscribers. Distributed Designs For Health revenue continued its planned reduction, supporting improving supplement margins. Outside Australia and the United Kingdom, distribution partnerships with SYNLAB and Genova are maintained to support future European and United States testing expansion.
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23 23 OPERATING & FINANCIAL REVIEW Review of Operations & Activities Therapeutics Microba holds field-leading live biotherapeutic intellectual property with deep preclinical and early clinical validation, including MAP-315, a clinically de-risked asset which is near Phase 2 ready. All Internal research and development remained paused as previously guided, preserving capital and core intellectual property while the Company pursues a capital-light partnering strategy across inflammatory bowel disease, autoimmune disease, oncology and allergy. Between November 2025 and July 2026 the sector delivered the modality-validating clinical readouts prospective partners had been awaiting, spanning graft-versus-host disease, allergic disease, irritable bowel syndrome, inflammatory bowel disease and oncology. The modality has now been validated. COMPANY ASSET AND INDICATION DATE OUTCOME Siolta Phase 1b/2, allergic disease 17 Nov 2025 Endpoints met MaaT Pharma Phase 3, graft-versus-host disease 8 Dec 2025 Positive pivotal Enterobiotix Phase 2a, irritable bowel syndrome 8 Jan 2026 Endpoints met Microbiotica Phase 1b, inflammatory bowel disease 11 Feb 2026 Endpoints met Microbiotica Phase 1b, oncology 18 May 2026 Endpoints met Seres Therapeutics Open-label, oncology 8 Jul 2026 Positive early data Aligned to this momentum, Microba attended the 2026 BIO International Convention and, supported by its Boston- based advisors, commenced a formal partnering campaign from July 2026. The lead asset, MAP-315, is a Phase 2-ready oral-capsule live biotherapeutic for mild-to-moderate ulcerative colitis, a market exceeding US$10 billion in which a significant proportion of patients remain under-served, with a fast-follow immuno-oncology program positioned for a rapid Phase 1b in immunotherapy-induced colitis.
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24 24 OPERATING & FINANCIAL REVIEW The Phase 1 trial of MAP-315 in ulcerative colitis was provisionally accepted for publication in Nature Communications. Partnering pathways include licensing arrangements and non-dilutive, asset-specific equity structures; no value is ascribed to a therapeutics transaction in the Company’s funding plans. Portfolio is ready to transact and advance Diversified portfolio of microbiome-derived live biotherapeutic products (LBPs) — active in a partnering process with a Boston-based advisor Artificial intelligence and operational efficiency FY26 marked Microba’s transition from a build phase to a scale phase, with the testing platform, laboratory infrastructure and core product substantially complete. AI is applied across the business, an AI customer-support agent autonomously resolved 71.4% of enquiries at a 94.7% satisfaction score, AI assistance increased software-engineering productivity by approximately 1.5x, and AI-supported scientific literature review reduced required human hours by approximately 30%. These efficiencies underpin the cost-streamlining program targeting an approximately $7 million annual reduction in ongoing cash operating costs, fully implemented in H1 FY27, concentrated in functions where the product build phase is complete, across customer support, engineering, science and other corporate function teams. Together, organic growth on a fixed cost base and AI-enabled operating leverage are designed to lift revenue per employee as volumes scale.
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25 25 OPERATING & FINANCIAL REVIEW RISK DESCRIPTION OF RISK Liquidity and ability to raise additional capital The Group is not yet cashflow positive and relies on external capital until revenues scale sufficiently; as disclosed in the financial statements, a material uncertainty exists should its planned initiatives not materialise. Market conditions and the share price influence the ability to raise, and unfavourable conditions could make raising more challenging, more dilutive, or both. Execution of the cost reduction program The approximately $7 million per annum cost reduction underpins the CY2027 full group break-even objective. Shortfalls in delivery, timing, or reductions that impair revenue-generating capability would extend the path to break-even. New product launch and commercialisation Growth plans include the Q2 FY27 launch of Microba GI Navigator and expansion to the medical-doctor segment. Launches carry risks of delay, slower clinician adoption, pricing pressure and evidence requirements. Reliance on key partners and customer concentration The Company relies on partners including Sonic Healthcare, and increasingly on enterprise-clinic accounts, which concentrate revenue and extend payment terms. Loss of, or adverse changes with, a significant partner or account could affect revenue and growth. Conversion of kits sold into recognised revenue Testing revenue is recognised on delivery of the final report rather than on sale of a kit. At 30 June 2026 the Company held $1.79 million of Microba Microbiome Explorer deferred revenue. Conversion of that balance depends on patients returning samples for analysis, which the Company only partly influences; kits that are not returned within their validity period expire. Lower return rates would defer or reduce recognised revenue and the associated cash conversion. Market development and adoption rates Microba is creating a new diagnostic category; adoption depends on clinician education, clinical evidence and, over time, reimbursement, and may progress more slowly than anticipated, as reflected in FY26 volumes and regional break-even finishing below the guidance given during the year. Material business risks The Company actively manages a range of risks with the potential to materially affect its strategic and business objectives. These risks are common across the healthcare, pathology and drug-development sectors; the table below is a condensed overview and not exhaustive.
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26 26 OPERATING & FINANCIAL REVIEW RISK DESCRIPTION OF RISK Regulatory and compliance Microba operates in highly regulated healthcare, diagnostics and clinical- trial environments. Changes in laws or standards relating to healthcare, privacy, data protection and medical testing could impact operations; non-compliance could result in liabilities, fines, reputational damage and delays. Competition The microbiome industry is evolving rapidly and attracting global competitors, creating potential pressure on pricing, margins and market share, and reinforcing the need for continued innovation, including in therapeutics targeting similar indications. Intellectual property protection Microba relies on protection of its proprietary technologies, patents and trade secrets. Patent grant outcomes, infringement risk or competitor challenges could affect its position. The Group carries goodwill of $9.2 million and other intangibles whose recoverable amounts depend on future performance; a $0.75 million impairment was recognised in FY26 on discontinued product technology. Therapeutics partnering and clinical trial outcomes The value of the therapeutic assets depends on securing a partnering transaction, the timing and terms of which are uncertain. Trials by the Company or peers may not meet endpoints, which could reduce the attractiveness of the modality and of Microba’s assets. Retention of key personnel Following restructuring, the Company depends on a smaller team with specialised bioinformatics, engineering, scientific and commercial capability; loss of key personnel could affect execution. Supply chain disruption Operations rely on consistent supply of laboratory equipment, consumables and reagents, in some cases from limited sources; disruption could affect throughput, cost of goods and the ability to meet demand. Foreign exchange and pricing The Group earns revenue and holds balances in multiple currencies, including GBP. Exchange rate movements affected the FY26 statutory result through a $1.51 million non-cash loss (FY25: $1.76 million gain) and may affect comparability between periods. Test pricing and realised gross margin are also assumptions underpinning the path to break-even; competitive pricing pressure, customer mix or contracted enterprise pricing could reduce margin per test. Jurisdictional and new market Expansion into new jurisdictions exposes the Company to differing regulatory, reimbursement and commercial conditions, affecting the pace and cost of market development. Cybersecurity and data protection The Company’s products have digital components and it holds sensitive personal health data. Evolving threats necessitate a robust information security framework; a breach could result in regulatory action, remediation costs and reputational damage.
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27 27 OPERATING & FINANCIAL REVIEW Likely developments and outlook Microba enters FY27 with a clean revenue base, continued core testing momentum and a structurally lower cost base. Priorities for the year ahead are: 001 Launching Microba GI Navigator In October 2026 and extending the platform to the medical- doctor segment. 002 Growing core testing volumes In Australia and the United Kingdom through the maturing enterprise-clinic channel and the Clinical Integration Platform. 003 Growing the own- brand Invivo Supplement and subscription base, and expanding gross margin through volume, mix and the consolidated laboratory footprint. 004 Realising the full benefit Of the approximately $7 million per annum cost reduction program implemented during H1 FY27. 005 Advancing the therapeutics Partnering campaign commenced in July 2026. Collectively, these initiatives are directed at achieving full group cashflow break-even, on a run-rate basis, in calendar year 2027. As set out at the June 2026 equity raising, the bridge from a monthly cash burn of approximately $1.3 million, comprises approximately $0.7 million of cost reductions and efficiencies and approximately $0.6 million of growth in revenue and contribution margin on a fixed cost base, delivered on infrastructure already in place. This forward financial information is based on management’s best-estimate assumptions, including operating expenditure growing below revenue growth, continued clinical adoption, and the availability of sufficient capital, and is subject to the material business risks.
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28 28 OPERATING & FINANCIAL REVIEW Break-even built on infrastructure already in place Each lever closes part of the gap from $1.3M monthly burn to break-even in CY2027 — delivered on infrastructure already invested, leveraging strong sales momentum. Sales & marketing efficiencies Reducing customer acquisition cost from AI-supported customer targeting and marketing, a unified global brand, automated lifecycle marketing and self-serve signup. Cost reductions & operational efficiencies AI automation across customer support, HR, legal and finance structurally lowers cost to serve as we scale. Engineering, science & product efficiency Major new product build about to complete. In addition, AI-supported product, evidence and software development systems cut engineering and product cost per release. Sales growth & margin expansion Rising volume on a fixed cost base, with margin expansion from pricing power, scaling economics and operational efficiency. The information on this page includes forward financial information (Forward Financial Information). The Forward Financial Information has been prepared by Microba Life Sciences Ltd based on management best estimate assumptions which relate to future event(s) that Microba expects to occur and actions that Microba expects to take and are also subject to uncertainties and contingencies, which are often outside the control of Microba. While all reasonable endeavours have been made to ensure both the robustness of the assumptions on which the Forward Financial Information is based and that such assumptions are true, complete and accurate, such assumptions are generally future-oriented and therefore speculative in nature.
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29 Microba.comMicroba.com Microba.com MICROBA LIFE SCIENCES LIMITED | ANNUAL REPORT 2026 03 Directors’ Report
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30 DIRECTORS’ REPORT Microba Life Sciences Limited Directors' report 30 June 2026 2 The Directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as the 'Group' or 'Microba') consisting of Microba Life Sciences Limited (referred to hereafter as the 'Company' or 'parent entity') and the entities it controlled at the end of, or during, the year ended 30 June 2026. Directors The following persons were Directors of Microba Life Sciences Limited during the whole of the financial year and up to the date of this report, unless otherwise stated: Pasquale Rombola Independent Non-Executive Director Ian Frazer Independent Non-Executive Director Gene Tyson Non-Executive Director Richard Bund (Resigned: 19 November 2025) Non-Executive Director Hyungtae Kim (Resigned: 19 November 2025) Non-Executive Director Jacqueline Fernley Independent Non-Executive Director Stéphane Chatonsky (Appointed: 20 November 2025) Independent Non-Executive Director The names of the Company Secretary in office at any time during or since the end of the year unless otherwise stated are: James Heath Results The loss for the Group after providing for income tax amounted to $20,721,356 (30 June 2025: $14,939,471). Review of operations Information on the operations and financial position of the Group is set out in the review of operations and activities on pages 13 to 28 of this Annual Report. Significant changes in the state of affairs There were no significant changes in the state of affairs of the Group during the financial year, other than those referred t o elsewhere in this report. Principal activities The principal activity of the Group during the year was providing world class microbiome testing, supplements and analysis services as well as developing new pathology services, therapeutics and diagnostics based on the human gut microbiome. No significant change in the nature of these activities occurred during the year. Dividends There were no dividends paid, recommended or declared during the current or previous financial year.
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31 DIRECTORS’ REPORT Microba Life Sciences Limited Directors' report 30 June 2026 3 After balance date events Capital Raising On 24 July 2026, an Extraordinary General Meeting (EGM) was held where shareholders approved the issuance of equity securities and attaching options related to the first and second tranche (Tranche 2) of the Placement and the Share Purchase Plan (SPP), as announced to the ASX on 12 June 2026. Following the EGM approval, the Company completed the following equity issuances: Tranche 2 Placement: On 29 July 2026, the Company completed the issuance of the Tranche 2 Placement, resulting in the issue of 8,659,785 new fully paid ordinary shares at $0.05 per share, raising approximately $0.4 million (before costs). Share Purchase Plan (SPP): On 29 July 2026, the Company completed the issuance of the SPP, where it raised an additional $0.4 million (before costs) through the issue of 8,150,000 new fully paid ordinary shares at $0.05 per share. The SPP participants also received one unlisted attaching option for every new share subscribed, resulting in the issuance of 8,150,000 attaching options exercisable at $0.0625 within three years from the date of issue. Options: On 29 July 2026, 100,004,240 options were issued at an exercise price of $0.0625 for Tranche 1 and Tranche 2 participants who received one unlisted attaching option for every new share subscribed, expiring within three years from the date of issue. As a result of these transactions, the Group's cash position has been significantly strengthened, providing additional working capital to accelerate product development, clinical adoption, and commercial growth initiatives as outlined in the capital raising announcement. Potential merger with Genetic Signatures Limited On 26 August 2026, the Company announced that it is in preliminary, non-binding discussions with Genetic Signatures Limited (ASX: GSS) regarding a potential merger of the two businesses. The discussions are at an early stage and remain incomplete. No binding agreement has been entered into, no firm decision to proceed has been made by either party, and there is no certainty that any transaction will proceed or as to its terms. Any transaction would be subject to further due diligence and all required regulatory and other approvals. As the discussions are preliminary and incomplete, any financial effect cannot be reliably estimated and no adjustment has been made to these financial statements. No other matter or circumstance has arisen since 30 June 2026 that has significantly affected, or may significantly affect th e Group's operations, the results of those operations, or the Group's state of affairs in future financial years. Likely developments Over the next 12 months, Microba’s primary focus will be on globally expanding the clinical adoption of its world leading diagnostic microbiome testing products, supplements and services. This expansion will occur both directly and in collaboration with our world leading distribution partners. Further information on the likely developments of the Group is set out in the review of operations and activities on page 22 of this Annual Report. Environmental regulation The Group is not subject to any significant environmental regulation under Australian Commonwealth or State law.
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32 DIRECTORS’ REPORT Microba Life Sciences Limited Directors' report 30 June 2026 4 Information on Directors, Chief Executive Officer and Company Secretaries Name: Pasquale Rombola Title: Chair & Non-Executive Director Experience and expertise: Mr Rombola has over 30 years’ corporate and financial experience in Australia, Asia and the United Kingdom. He spent 19 years in senior positions with Morgan Stanley and Deutsche Bank, including 7 years in the role of Managing Director. Mr Rombola is the Chair of Advantage Agriculture Pty Ltd, a private agribusiness company. He was also formerly the Chair and Director of Helix Resources Limited (ASX: HLX) and Non - Executive Director of Audeara Limited, a leading hearing health company (ASX: AUA). Mr Rombola holds a Bachelor of Economics from the University of Western Australia. Other current directorships: None Former directorships: Audeara Limited (ASX:AUA) - appointed 31 March 2021, resigned 28 August 2023 Subcommittees: Member - Audit and Risk Committee Member - Nomination and Remuneration Committee Interests in shares: 7,820,000 ordinary shares Interests in options: 1,550,000 options over ordinary shares Name: Ian Frazer Title: Deputy Chair & Non-Executive Director Experience and expertise: Emeritus Professor Frazer is a clinician scientist, trained as a clinical immunologist. He is an Emeritus Professor at the University of Queensland and is the former Chair of the Australian Medical research Advisory Board (AMRAB) which advises the Minister for Health and Aged Care on prioritising spending from the Medical Research Future Fund (MRFF). He is recognised as co -inventor of the technology enabling Gardasil – the leading vaccine currently used worldwide to assist in the prevention of cervical cancer. Emeritus Professor Frazer holds a Doctor of Medicine from the University of Melbourne and a Bachelor of Medicine, Bachelor of Surgery and Bachelor of Science (Hons) from the University of Edinburgh. Other current directorships: None Former directorships: None Subcommittees: Chair - Audit and Risk Committee Interests in shares: 2,868,235 ordinary shares Interests in options: 616,666 options over ordinary shares Name: Gene Tyson Title: Non-Executive Director & Co-Founder Experience and expertise: Professor Tyson is a Professor of Microbial Genomics at The Queensland University of Technology and is the Director of the Centre for Microbiome Research. He published the first paper regarding the use of metagenomic -sequencing for assessing microbial communities. Professor Tyson is considered a world leading expert in microbial analysis with previous tenure at the University of California, Massachusetts Institute of Technology and the University of Queensland. Professor Tyson holds a Bachelor of Science (Hons) from the University of Queensland and a PhD from the University of California, Berkeley. Other current directorships: None Former directorships: None Subcommittees: Member - Nomination and Remuneration Committee Interests in shares: 15,920,000 ordinary shares Interests in options: 0 options over ordinary shares
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33 DIRECTORS’ REPORT Microba Life Sciences Limited Directors' report 30 June 2026 5 Name: Richard Bund (Resigned: 19 November 2025) Title: Non-Executive Director Experience and expertise: Mr Bund is a Chartered Accountant and Director of Equipe Advisory accounting firm. Mr Bund has more than 25 years’ experience in accounting and corporate finance and is a Director of several private Australian companies. Mr Bund is a Member of Chartered Accountants Australia & New Zealand (CAANZ). He holds a Bachelor of Commerce (Accounting) from the University of Adelaide and a Graduate Diploma in Chartered Accounting from the Institute of Chartered Accountants Australia (ICAA). Other current directorships: None Former directorships: None Subcommittees: Member - Audit and Risk Committee Chair - Nomination and Remuneration Committee Interests in shares: 30,961,049 ordinary shares held at date of resignation Interests in options: N/A Name: Hyungtae Kim (Resigned: 19 November 2025) Title: Non-Executive Director Experience and expertise: Dr Hyungtae Kim is an internationally experienced leader in the genomics field, having held the positions of Chief Executive Officer of Macrogen, Inc., (Macrogen) from 2008 to 2014 and Chief Executive Officer of Macrogen Europe from 2015 to 2017. Dr Kim is the CEO of Hunomics and Director of the Gongwu Genome Information Foundation (GGIF). Dr Kim holds a PhD in Molecular Biology from The George Washington University. Other current directorships: None Former directorships: None Subcommittees: None Interests in shares: 17,828,431 ordinary shares, held indirectly through Macrogen Inc. at date of resignation. Interests in options: N/A Name: Jacqueline Fernley Title: Non-Executive Director Experience and expertise: Mrs Fernley currently serves as the Chief Investment Officer (CIO) of Mason Stevens where she leads the asset management division of the firm. Prior to joining Mason Stevens, Mrs Fernley held roles as Head of Equities at J B Were Limited, Head of Research at Wilson HTM and Australian Equity Portfolio Manager at Colonial First State Global Asset Management. Mrs Fernley has a Bachelor's Degree in Commerce/Law, is a holder of the Chartered Financial Analyst (CFA) designation, is a member of Chief Executive Women (CEW), and is a graduate of the Australian Institute of Company Directors (GAICD). Mrs Fernley is also intimately involved in mentoring and supporting women in the financial services industry and ESG, regularly presenting to investment committees, boards, and management on the topics. She currently sits on the diversity committee of the NSW CFA Society. Other current directorships: None Former directorships: None Subcommittees: Chair - Nomination and Remuneration Committee Interests in shares: 0 ordinary shares Interests in options: 200,000 options over ordinary shares
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34 DIRECTORS’ REPORT Microba Life Sciences Limited Directors' report 30 June 2026 6 Name: Stéphane Chatonsky Title: Non-Executive Director Experience and expertise: Mr Chatonsky has over 25 years of experience in venture capital, investment and corporate strategy, focused on high -growth healthcare, pathology and technology businesses. He has held various roles with Lazard, McKinsey & Company, Macquarie Bank, 4Cyte Pathology, LeapFrog Investments, and is a Senior Advisor to Heidi Health and Vexev. He holds an MBA from the Wharton School, a Bachelor of Economics from ESSEC Business School (Paris), and is a Graduate of the Australian Institute of Company Directors. Other current directorships: None Former directorships: None Subcommittees: Member - Audit and Risk Committee Interests in shares: 0 ordinary shares Interests in options: 0 options over ordinary shares Name: Luke Reid Title: Chief Executive Officer Experience and expertise: Dr Reid is an experienced research and technology commercialisation executive. His deep knowledge of the biotechnology sector has underpinned Microba's growth into a global biotechnology company delivering on its mission to improve human health with precision microbiome science. Dr Reid's expertise in translational research, technology commercialisation, commercial partnerships, licensing and intellectual property management uniquely places him to lead Microba as Chief Executive Officer. Previously, Dr Reid was Associate Director at UniQuest Pty Ltd, one of the global leaders in commercialisation of university technology. Prior to UniQuest, Dr Reid held roles working with the world's leading developer of advanced plant genetics, DuPont Pioneer, and the world leader in bioinnovation of enzymes, proteins and microorganisms, Novozymes. Dr Reid holds a PHD in Molecular Biology from The University of Adelaide and a Bachelor of Science (Biotechnology (Hons)) from Flinders University. Name: James Heath Title: Chief Financial Officer & Company Secretary Experience and expertise: Mr Heath is a Chartered Accountant with over 13 years' experience in accounting, finance and operations across a broad range of industries. Prior to joining Microba, he was a management consultant and auditor at Deloitte Australia. Mr Heath is a member of Chartered Accountants Australia and New Zealand, holding a Graduate Diploma in Chartered Accounting. He also holds a Bachelor of Business Management and a Bachelor of Commerce (Accounting) from the University of Queensland. 'Other current directorships' and 'former directorships' quoted above are directorships for ASX listed entities only and excludes directorships of all other types of entities, unless otherwise stated. 'Former directorships' shown above are directorships held within the last 3 years only.
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35 DIRECTORS’ REPORT Microba Life Sciences Limited Directors' report 30 June 2026 7 Meetings of Directors The number of meetings of the Company's Board of Directors ('the Board') and of each Board committee held during the year ended 30 June 2026, and the number of meetings attended by each Director were: Full Board Nomination and Remuneration Committee Audit and Risk Committee Attended Held Attended Held Attended Held Pasquale Rombola 11 11 3 3 3 3 Ian Frazer 10 11 - - 3 3 Gene Tyson 9 11 3 3 - - Richard Bund 4 4 2 2 1 1 Hyungtae Kim 4 4 - - - - Jacqueline Fernley 11 11 3 3 - - Stèphane Chatonsky 6 7 - - 2 2 Held: represents the number of meetings held during the time the Director held office or was a member of the relevant committee. Options Options over unissued ordinary shares granted by Microba Life Sciences Limited during or since the end of the financial year were as follows: Shares under option Unissued ordinary shares of Microba Life Sciences Limited under option at the date of this report are as follows: Date options granted Number of options Exercise price of options Expiry date of the options 28/07/2023 6,145,000 $0.4530 28/07/2027 28/07/2023 2,000,000 $0.6380 28/07/2027 28/12/2023 200,000 $0.2710 28/01/2027 10/02/2025 10,070,511 $0.3790 10/02/2029 13/08/2025 46,296,296* $0.0900 13/01/2027 13/08/2025 80,555,423 $0.1400 13/08/2027 29/07/2026 100,004,240 $0.0625 29/07/2029 29/07/2026 8,150,000 $0.0625 29/07/2029 253,421,470 *46,296,296 options issued to Sonic Healthcare as part of the June 2025 capital raise. The final number of options to be issued will be determined by dividing the AUD equivalent of $4.16m AUD by the greater of: - 90% of the 30-day VWAP prior to exercise; and - $0.09 per share. For every four shares issued under the exercise of this option, Sonic Healthcare will also receive one attaching option exercisable at a 20% premium to the exercise price, with a 36-month expiry. No option holder has any right under the options to participate in any other share issue of the Group. Shares issued on the exercise of options There were no ordinary shares of Microba Life Sciences Limited issued on the exercise of options during the year ended 30 June 2026 and up to the date of this report. Indemnification of Directors, officers and key management personnel The Group has indemnified the Directors, officers and key management personnel of the Group for costs incurred, in their capacity as a Director, officer or key management personnel, for which they may be held personally liable, except where there is a lack of good faith.
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36 DIRECTORS’ REPORT Microba Life Sciences Limited Directors' report 30 June 2026 8 During the financial year, the Company paid a premium in respect of a contract to insure the Directors, officers and key management personnel of the Company against a liability to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits disclosure of the nature of the liability and the amount of the premium. Indemnification of auditors No indemnities have been given or insurance premiums paid, during or since the end of the year, for any person who is or has been an auditor of the Group. Proceedings on behalf of the Group No person has applied to the Court for leave to bring proceedings on behalf of the Group, or to intervene in any proceedings to which the Group is a party for the purpose of taking responsibility on behalf of the Group for all or part of those proceedings. Non-audit services Details of the amounts paid or payable to the auditor for non -audit services provided during the financial year by the auditor are outlined in note 36 to the financial statements. The Directors are satisfied that the provision of non -audit services during the financial year, by the auditor (or by another person or firm on the auditor's behalf), is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The Directors are of the opinion that the services as disclosed in note 36 to the financial statements do not compromise the external auditor's independence requirements of the Corporations Act 2001 for the following reasons: ● all non-audit services have been reviewed and approved to ensure that they do not impact the integrity and objectivity of the auditor; and ● none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants (including Independence Standards) issued by the Accounting Professional and Ethical Standards Board, including reviewing or auditing the auditor's own work, acting in a management or decision - making capacity for the Company, acting as advocate for the Company or jointly sharing economic risks and rewards. Officers of the Company who are former Partners of Pitcher Partners There are no officers of the Company who are former Partners of Pitcher Partners, the Group's auditor. Rounding of amounts The Group is of a kind referred to in ASIC Corporations (Rounding in Financial/Directors' Reports) Instrument 2026/183 , relating to "rounding off". Amounts in this report have been rounded off in accordance with that Corporations Instrument to the nearest dollar.
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37 DIRECTORS’ REPORT Microba Life Sciences Limited Directors' report 30 June 2026 9 Remuneration report (audited) The remuneration report details the key management personnel remuneration arrangements for the Group, in accordance with the requirements of the Corporations Act 2001 and its Regulations. Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, including all Directors. The Group's KMP for the financial year ended 30 June 2026 are listed in the table below: Name Title Term KMP Status Non-Executive Directors: Pasquale Rombola Chair & Non-Executive Director Full Year Current Ian Frazer Deputy Chair & Non-Executive Director Full Year Current Gene Tyson Non-Executive Director & Co-Founder Full Year Current Richard Bund (Resigned 19 November 2025) Non-Executive Director Part Year Former Hyungtae Kim (Resigned 19 November 2025) Non-Executive Director Part Year Former Jacqueline Fernley Non-Executive Director Full Year Current Stéphane Chatonsky (Appointed 20 November 2025) Non-Executive Director Part Year Current Other Key Management Personnel: Luke Reid Chief Executive Officer Full Year Current James Heath Chief Financial Officer & Company Secretary Full Year Current The remuneration report is set out under the following main headings: ● Principles to determine the nature and amount of remuneration; ● Details of remuneration; ● Share-based compensation; ● Additional disclosures relating to key management personnel; and ● Service agreements. Principles used to determine the nature and amount of remuneration The objective of the Group's executive reward framework is to ensure reward for performance is competitive and appropriate for the results delivered. The framework aligns executive reward with the achievement of strategic objectives and the creation of value for shareholders, and it is considered to conform to the market best practice for the delivery of reward. The Board of Directors ('the Board') ensures that executive reward satisfies the following key criteria for good reward governance practices: ● competitiveness and reasonableness; ● acceptability to shareholders; ● performance linkage / alignment of executive compensation; and ● transparency. The Nomination and Remuneration Committee is responsible for determining and reviewing remuneration arrangements for its Directors and executives. As the performance of the Group depends on the quality of its Directors and executives, the remuneration philosophy is to attract, motivate and retain high performance and high quality personnel. The Nomination and Remuneration Committee has structured an executive remuneration framework that is market competitive, complementary to the reward strategy of the Group and is designed to align executive reward to shareholders' interests by: ● focusing on sustained growth in shareholder value, delivering increasing asset value and including focusing the executive on key non-financial drivers of value; and ● attracting and retaining high calibre executives. Additionally, the reward framework should seek to enhance executives' interests by: ● rewarding capability and experience; ● reflecting competitive reward for contribution to growth in shareholder value; and ● providing a clear structure for earning rewards.
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38 DIRECTORS’ REPORT Microba Life Sciences Limited Directors' report 30 June 2026 10 Non-executive Directors remuneration Fees and payments to non-executive Directors reflect the demands and responsibilities of their role. Non-executive Directors' fees and payments are reviewed annually by the Nomination and Remuneration Committee. The Chair and Deputy Chair's fees are determined independently to the fees of other non -executive Directors based on comparative roles in the external market. ASX listing rules require the aggregate non -executive Directors' remuneration be determined periodically by a general meeting. The most recent determination was at the General Meeting held on 1 February 2023, where the shareholders approved a maximum annual aggregate remuneration of $600,000. Non-executive Director fees for the year ended 30 June 2026 totalled $386,542, being 64% of the approved cap. Fees paid to Professor Tyson for advisory services provided outside his capacity as a Director are not counted against the cap. Executive remuneration The Group aims to reward executives based on their position and responsibility, with a level and mix of remuneration which has both fixed and variable components. The executive remuneration and reward framework has four components: ● base pay and non-monetary benefits; ● short-term performance incentives; ● long term incentive through Employee Share and Option Plan participation; and ● other remuneration such as superannuation and long service leave. The combination of these comprises the executive's total remuneration. Fixed remuneration, consisting of base salary, superannuation and non -monetary benefits, are reviewed annually by the Nomination and Remuneration Committee based on individual and business unit performance, the overall performance of the Group and comparable market remunerations. The STI program aligns the Group's annual objectives with executive performance. STI is generally settled in cash and is determined by reference to a service condition, individual performance objectives, and an overarching company performance gate assessed over the year. Under the service condition, an executive must generally remain employed by the Group and in good standing through to the payment date for any STI to be payable. At the start of the year the Nomination and Remuneration Committee sets each executive's STI opportunity (a target percentage of fixed remuneration) together with a scorecard of objectives and key results ('OKRs') spanning business unit milestones, shareholder value creation, customer satisfaction and leadership contribution. Regardless of individual outcomes, STI only becomes payable if Group performance against Board-approved targets reaches a minimum threshold. No STI is unlocked below 70% of target; from there the proportion unlocked scales with performance, being 25% unloc ked at 70% of target, 50% at 80%, 75% at 90%, 90% at 95%, and 100% at target, increasing further for stretch performance up to a maximum of 200% at 150% of target. The long -term incentives ('LTI') include share -based payments. For the year ended 30 June 2026 Group performance did not reach the level required for the STI opportunity to be unlocked in full. Short-term incentives equivalent to 7% of each executive's STI opportunity were assessed as payable, and 93% was forfeited. No discretionary amount was awarded above the outcome produced by the Board-approved performance gate. This follows a similar reduction in the prior year, in which 55% of the STI opportunity was unlocked. The Board may approve the issue of securities (shares, performance rights or options) to staff and executives as a means of providing long term incentive for performance and loyalty. Any such securities are issued under the Microba Employee Share and Option Plan.
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39 DIRECTORS’ REPORT Microba Life Sciences Limited Directors' report 30 June 2026 11 Securities are awarded to staff and executives over a minimum period of one year based on long -term incentive measures. These include increase in shareholders’ value relative to the Group's direct peers. The Nomination and Remuneration Committee undertook a thorough review of the Microba LTI program during the year ended 30 June 2025. The Nomination and Remuneration Committee’s primary objective with the LTI scheme is to align the interests of our executives with those of our shareholders. The design focus of the LTI scheme has been on incentivising the attainment of strategic goals, consequently creating shareholder value. The LTI scheme has been constructed based on compound annual growth rates (CAGR) in group revenue (which as aforementioned, includes organic growth and not acquired growth), and the successful achievement of significant milestones within our therapeutic programs (Tx progress). To further align executives with shareholders, options are granted with a premium exercise price, set at the greater of a fixed floor price or 143% of the share price at the grant date. Details of remuneration Amounts of remuneration Details of the remuneration of key management personnel of the Group are set out in the following tables: Short-term benefits Post- employment benefits Long-term benefits Share-based payments Cash salary Advisory Cash Super- Long service Equity- and fees fees bonus annuation leave settled Options Total 2026 $ $ $ $ $ $ $ $ Non-Executive Directors: Pasquale Rombola 95,000 - - - - - - 95,000 Ian Frazer 85,000 - - - - - - 85,000 Gene Tyson1 60,000 4,000 - - - - - 64,000 Richard Bund 29,167 - - - - - - 29,167 Hyungtae Kim 20,833 - - - - - - 20,833 Jacqueline Fernley 60,000 - - - - - 1,131 61,131 Stéphane Chatonsky 36,542 - - - - - - 36,542 Other Key Management Personnel: Luke Reid 368,013 - 7,350 33,000 3,654 - 255,913 667,930 James Heath 278,157 - 6,300 30,600 2,860 - 71,808 389,725 1,032,712 4,000 13,650 63,600 6,514 - 328,852 1,449,328
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40 DIRECTORS’ REPORT Microba Life Sciences Limited Directors' report 30 June 2026 12 Short-term benefits Post- employment benefits Long-term benefits Share-based payments Cash salary Advisory Cash Super- Long service Equity- and fees fees bonus annuation leave settled Options Total 2025 $ $ $ $ $ $ $ $ Non-Executive Directors: Pasquale Rombola 95,000 - - - - - 11,701 106,701 Ian Frazer 85,000 - - - - - 11,701 96,701 Gene Tyson1 60,000 48,000 - - - - 7,801 115,801 Richard Bund 70,000 - - - - - 7,801 77,801 Hyungtae Kim 50,000 - - - - - 7,801 57,801 Jacqueline Fernley 60,000 - - - - - 4,087 64,087 Other Key Management Personnel: Luke Reid 349,608 - 58,013 29,356 12,880 - 221,709 671,566 James Heath 274,967 - 49,725 28,394 9,152 - 45,154 407,392 1,044,575 48,000 107,738 57,750 22,032 - 317,755 1,597,850 1Professor Gene Tyson, in addition to his role as a Non -Executive Director, was separately engaged under an independent contractor agreement to provide scientific advisory services one day per week. Fees are disclosed as Advisory fees in the above table. The proportion of remuneration linked to performance and the fixed proportion are as follows: Fixed remuneration At risk - STI At risk - LTI Name 2026 2025 2026 2025 2026 2025 Non-Executive Directors: Pasquale Rombola 100% 89% - - - 11% Ian Frazer 100% 88% - - - 12% Gene Tyson 100% 93% - - - 7% Richard Bund 100% 90% - - - 10% Hyungtae Kim 100% 87% - - - 13% Jacqueline Fernley 98% 94% - - 2% 6% Stéphane Chatonsky 100% - - - - - Other Key Management Personnel: Luke Reid 61% 58% 1% 9% 38% 33% James Heath 80% 77% 2% 12% 18% 11% The proportion of the STI paid/payable and forfeited is as follows: STI paid/payable STI forfeited Name 2026 2025 2026 2025 Other Key Management Personnel: Luke Reid 7% 55% 93% 45% James Heath 7% 55% 93% 45%
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41 DIRECTORS’ REPORT Microba Life Sciences Limited Directors' report 30 June 2026 13 Share-based compensation Issue of shares There were no shares issued to Directors and other key management personnel as part of compensation during the year ended 30 June 2026. Options There were no options over ordinary shares issued to Directors and other key management personnel as part of compensation that were granted during the year ended 30 June 2026. The options shown as granted in the option holding table below were attaching options acquired by Directors and key management personnel through the capital raising completed on 13 August 2025 (one unlisted attaching option for every two new shares subscribed, exercisable at $0.14), on the same terms as all other participating shareholders and at no additional cost. They do not form part of remuneration and no amount in respect of them is included in the remuneration tables above. The performance conditions and their relative weighting attached to the options held by key management personnel (each of Luke Reid and James Heath), by grant, are as follows: 28/07/2023 Grant 10/02/2025 Grant Vesting Condition % % No performance hurdle 50% 50% Revenue-growth CAGR 25% 50% Therapeutic-program (Tx) milestone 25% - All options granted are tied to tenure and are forfeited on termination if unvested at termination date. Additional disclosures relating to key management personnel Shareholding The number of shares in the Company held during the financial year by each Director and other members of key management personnel of the Group, including their personally related parties, is set out below: Balance at Received Balance at the start of as part of Disposals/ the end of the year remuneration Additions other the year Ordinary shares Pasquale Rombola 5,970,000 - 600,000 - 6,570,000 Ian Frazer 1,834,902 - 833,333 - 2,668,235 Gene Tyson 15,920,000 - - - 15,920,000 Richard Bund1 33,480,799 - - (33,480,799) - Hyungtae Kim2 17,828,431 - - (17,828,431) - Jacqueline Fernley - - - - - Stéphane Chatonsky - - - - - Luke Reid 511,217 - 166,666 - 677,883 James Heath 531,957 - 200,000 - 731,957 76,077,306 - 1,799,999 (51,309,230) 26,568,075 1Resigned 19 November 2025, disposed of 2,519,750 shares during the period leading up to the resignation date and held 30,961,049 shares as at the date of ceasing to be a key management person. Balance at the end of the year is nil due to no longer being a key management person. 2 Resigned 19 November 2025, held 17,828,431 shares as at the date of ceasing to be a key management person. Balance at the end of the year is nil due to no longer being a key management person.
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42 DIRECTORS’ REPORT Microba Life Sciences Limited Directors' report 30 June 2026 14 Option holding The number of options over ordinary shares in the Company held during the financial year by each Director and other members of key management personnel of the Group, including their personally related parties, is set out below. Options shown as granted are the attaching options acquired through the 13 August 2025 capital raising referred to above and do not form part of remuneration. Balance at Expired/ Balance at the start of forfeited/ the end of the year Granted Exercised other the year Options over ordinary shares Pasquale Rombola - 300,000 - - 300,000 Ian Frazer - 416,666 - - 416,666 Jacqueline Fernley 200,000 - - - 200,000 Luke Reid 5,556,521 83,333 - (225,000) 5,414,854 James Heath 1,662,173 100,000 - (150,000) 1,612,173 7,418,694 899,999 - (375,000) 7,943,693 Balance at Vested and Unvested and the end of exercisable unexercisable the year Options over ordinary shares Pasquale Rombola - 300,000 300,000 Ian Frazer - 416,666 416,666 Jacqueline Fernley 134,000 66,000 200,000 Luke Reid - 5,414,854 5,414,854 James Heath - 1,612,173 1,612,173 134,000 7,809,693 7,943,693 No loans have been provided to key management personnel or their related parties. Other transactions with key management personnel Other than the independent contractor agreement with Professor Gene Tyson described in note 1 to the remuneration tables above, and participation by Directors and key management personnel in the share purchase plan on the same terms as all other participating shareholders, there were no transactions with key management personnel or their related parties during the year ended 30 June 2026. Termination benefits No termination benefits were paid or became payable to any key management person or former key management person during the year ended 30 June 2026. Remuneration governance No remuneration consultant was engaged, and no remuneration recommendation as defined in section 9B of the Corporations Act 2001 was obtained, during the year ended 30 June 2026. During the year ended 30 June 2026 the Group's incentive arrangements did not include malus or clawback provisions or a minimum shareholding requirement for executives. Hedging of unvested incentive remuneration by key management personnel is prohibited by section 206J of the Corporations Act 2001, and the Company had no additional hedging policy during the year. Key management personnel are subject to the Group's Securities Trading Policy, which restricts dealing in the Company's securities during designated closed periods and requires prior clearance for all dealings. Voting on the prior year remuneration report At the annual general meeting held on 19 November 2025, shareholders adopted the remuneration report for the year ended 30 June 2025. All resolutions put to the meeting were carried, each with more than 92% of votes cast in favour.
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43 DIRECTORS’ REPORT Microba Life Sciences Limited Directors' report 30 June 2026 15 Additional information The earnings of the Group for the five years to 30 June 2026 are summarised below: 2026 2025 2024 2023 2022 $ $ $ $ $ Sales revenue 14,758,461 15,669,089 12,090,055 5,420,136 4,688,645 Loss after income tax (20,721,356) (14,939,471) (19,938,485) (12,680,212) (11,470,429) As a pre-profit, growth-stage company, the Board has not linked remuneration to total shareholder return (TSR) or earnings per share. Executive options are subject to a service condition and, depending on the grant, revenue -growth CAGR and therapeutic-program milestone performance conditions; non-executive director options are subject to a service condition only. No component of remuneration is linked to TSR. The factors that are considered to affect total shareholders return ('TSR') are summarised below: 2026 2025 2024 2023 2022 Share price at financial year end ($) 0.04 0.09 0.16 0.30 0.20 Basic earnings per share (cents per share) (3.45) (3.33) (4.86) (4.03) (5.14) Diluted earnings per share (cents per share) (3.45) (3.33) (4.86) (4.03) (5.14) Service agreements Remuneration and other terms of employment for key management personnel are formalised in service agreements. Details of these agreements are as follows: Name: Dr Luke Reid Title: Chief Executive Officer Agreement commenced: 5 April 2022 Term of agreement: Ongoing Details: Base Salary: $350,000 per annum Performance Based Incentive: $105,000 per annum Superannuation: 12%, subject to the maximum superannuation contribution base Termination Notice: 12 weeks Name: James Heath Title: Chief Financial Officer & Company Secretary Agreement commenced: 5 April 2022 Term of agreement: Ongoing Details: Base Salary: $270,000 per annum Performance Based Incentive: $90,000 per annum Superannuation: 12%, subject to the maximum superannuation contribution base Termination Notice: 12 weeks Key management personnel have no entitlement to termination payments in the event of removal for misconduct.
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44 DIRECTORS’ REPORT Microba Life Sciences Limited Directors' report 30 June 2026 16 Events after the reporting period On 24 July 2026 the Board, on the recommendation of the Nomination and Remuneration Committee, approved a revised retention and incentive framework for the year ending 30 June 2027. No securities have been granted or issued under the revised framework and no amount in respect of it is included in the remuneration disclosed for the year ended 30 June 2026. Under the revised framework, performance rights with a nil exercise price replace options, the exercise prices of options previously approved being substantially above the prevailing share price. For executives, vesting is in three equal tranches, subject respectively to a two-year continuing service condition, a Group cash flow break-even condition and a total shareholder return condition; for other participants, vesting is divided equally between the service and break -even conditions. Allocations are set as a percentage of fixed annual remuneration across four participant tiers. Eligible employees may also elect, before the start of the performance period, to forgo their cash short -term incentive for the year ending 30 June 2027 in exchange for performance rights with a face value of three times the amount forgone, vesting subject to the Group cash flow break-even condition. Participation by key management personnel is subject to shareholder approval under ASX Listing Rule 10.14 at the Company's next annual general meeting. The proposed grants and their terms will be set out in the notice of meeting. On 29 July 2026 a placement approved by shareholders on 24 July 2026 completed at $0.05 per share, with one attaching option for each share subscribed, exercisable at $0.0625 and expiring on 29 July 2029. Mr Rombola and Professor Frazer participated in tranche 2 under ASX Listing Rule 10.11 on the same terms as all other placement participants, and those securities do not form part of remuneration. This concludes the remuneration report, which has been audited. Auditor's independence declaration A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out immediately after this Directors' report. This report is made in accordance with a resolution of Directors, pursuant to section 298(2)(a) of the Corporations Act 2001. On behalf of the Directors ___________________________ Pasquale Rombola Director 31 August 2026 Brisbane
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45 Microba.comMicroba.com Microba.com MICROBA LIFE SCIENCES LIMITED | ANNUAL REPORT 2026 04 Financial Statements
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46 FINANCIAL STATEMENTS Level 38, 345 Queen Street Brisbane, QLD 4000 Postal address GPO Box 1144 Brisbane, QLD 4001 +61 7 3222 8444 pitcher.com.au Nigel Fischer Mark Nicholson Peter Camenzuli Jason Evans Kylie Lamprecht Norman Thurecht Brett Headrick Warwick Face Cole Wilkinson Simon Chun Jeremy Jones Tom Splatt James Field Daniel Colwell Robyn Cooper Felicity Crimston Cheryl Mason Kieran Wallis Murray Graham Andrew Robin Karen Levine Edward Fletcher Robert Hughes Tracey Norris Anthony Kazamias Sean Troyahn Adele Smith Alex Pollock Pitcher Partners is an association of independent firms. An Independent Queensland Partnership ABN 84 797 724 539. Liability limited by a scheme approved under Professional Standards Legislation. Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities. Adelaide | Brisbane | Melbourne | Newcastle | Perth | Sydney The Directors Microba Life Sciences Limited Level 10, 324 Queen Street Brisbane, QLD, 4000 Auditor’s Independence Declaration In relation to the independent audit for the year ended 30 June 2026, to the best of my knowledge and belief there have been: (i) No contraventions of the auditor independence requirements of the Corporations Act 2001; and (ii) No contraventions of APES 110 Code of Ethics for Professional Accountants (including Independence Standards). This declaration is in respect of Microba Life Sciences Limited and the entities it controlled during the year. PITCHER PARTNERS DANIEL COLWELL Partner Brisbane, Queensland 31 August 2026
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47 FINANCIAL STATEMENTS Microba Life Sciences Limited Consolidated statement of profit or loss and other comprehensive income For the year ended 30 June 2026 Note 2026 2025 $ $ The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes 18 Revenue Revenue from contracts with customers 4 14,758,461 15,669,089 Cost of sales (7,732,289) (8,227,712) Gross profit 7,026,172 7,441,377 Grant and subsidies income 5 1,105,398 2,830,877 Interest income 315,606 583,355 Net gain on derecognition of contingent consideration payable 6 - 4,469,548 Other income 85,593 95,658 Foreign currency gain 7 - 1,759,767 Net gain on lease revaluation 44,499 - Fair value gain on derivative financial liability 23 356,944 - Expenses Employee benefits and other related costs 9 (14,354,073) (16,485,564) Research and development expense (417,065) (2,008,294) Depreciation and amortisation expense 10 (4,411,401) (4,431,174) Consulting fees (1,840,806) (3,422,569) Marketing and advertising expense (1,182,712) (662,292) Travel expenses (311,006) (465,813) Legal and intellectual property advisory fees (202,205) (200,236) Finance costs 11 (238,557) (176,687) Subscriptions and information technology expenses (1,649,033) (1,279,502) Impairment of Intangibles 19 (745,485) - Foreign currency loss 7 (1,505,935) - Net (loss) on disposal of assets (97,280) - Other expenses (2,962,622) (3,094,516) Total expenses (29,918,180) (32,226,647) Loss before income tax benefit (20,983,968) (15,046,065) Income tax benefit 8 262,612 106,594 Loss after income tax benefit for the year attributable to the owners of Microba Life Sciences Limited (20,721,356) (14,939,471) Other comprehensive loss Items that may be reclassified subsequently to profit or loss Foreign currency translation (86,832) (258,680) Other comprehensive loss for the year, net of tax (86,832) (258,680) Total comprehensive loss for the year attributable to the owners of Microba Life Sciences Limited (20,808,188) (15,198,151) Cents Cents Basic earnings per share 37 (3.45) (3.33) Diluted earnings per share 37 (3.45) (3.33) Microba Life Sciences Limited Consolidated statement of profit or loss and other comprehensive income For the year ended 30 June 2026 Note 2026 2025 $ $ The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes 18 Revenue Revenue from contracts with customers 4 14,758,461 15,669,089 Cost of sales (7,732,289) (8,227,712) Gross profit 7,026,172 7,441,377 Grant and subsidies income 5 1,105,398 2,830,877 Interest income 315,606 583,355 Net gain on derecognition of contingent consideration payable 6 - 4,469,548 Other income 85,593 95,658 Foreign currency gain 7 - 1,759,767 Net gain on lease revaluation 44,499 - Fair value gain on derivative financial liability 23 356,944 - Expenses Employee benefits and other related costs 9 (14,354,073) (16,485,564) Research and development expense (417,065) (2,008,294) Depreciation and amortisation expense 10 (4,411,401) (4,431,174) Consulting fees (1,840,806) (3,422,569) Marketing and advertising expense (1,182,712) (662,292) Travel expenses (311,006) (465,813) Legal and intellectual property advisory fees (202,205) (200,236) Finance costs 11 (238,557) (176,687) Subscriptions and information technology expenses (1,649,033) (1,279,502) Impairment of Intangibles 19 (745,485) - Foreign currency loss 7 (1,505,935) - Net (loss) on disposal of assets (97,280) - Other expenses (2,962,622) (3,094,516) Total expenses (29,918,180) (32,226,647) Loss before income tax benefit (20,983,968) (15,046,065) Income tax benefit 8 262,612 106,594 Loss after income tax benefit for the year attributable to the owners of Microba Life Sciences Limited (20,721,356) (14,939,471) Other comprehensive loss Items that may be reclassified subsequently to profit or loss Foreign currency translation (86,832) (258,680) Other comprehensive loss for the year, net of tax (86,832) (258,680) Total comprehensive loss for the year attributable to the owners of Microba Life Sciences Limited (20,808,188) (15,198,151) Cents Cents Basic earnings per share 37 (3.45) (3.33) Diluted earnings per share 37 (3.45) (3.33)
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48 FINANCIAL STATEMENTS Microba Life Sciences Limited Consolidated statement of financial position As at 30 June 2026 Note 2026 2025 $ $ The above consolidated statement of financial position should be read in conjunction with the accompanying notes 19 Assets Current assets Cash and cash equivalents 12 7,947,457 11,740,910 Receivables 13 3,206,620 4,109,379 Inventories 14 2,215,397 1,937,851 Other assets 16 517,468 1,074,551 Total current assets 13,886,942 18,862,691 Non-current assets Financial assets 15 264,529 138,644 Property, plant and equipment 17 1,156,322 2,018,149 Right-of-use assets 18 1,160,961 1,854,825 Intangible assets 19 23,340,280 24,562,817 Total non-current assets 25,922,092 28,574,435 Total assets 39,809,034 47,437,126 Liabilities Current liabilities Payables 20 4,693,401 5,520,863 Borrowings 21 2,376,837 746,496 Lease liabilities 22 935,565 982,428 Derivative financial instruments 23 28,864 - Employee benefits 24 791,370 915,855 Contract liabilities 26 1,882,635 1,828,510 Income tax payable 34,304 13,471 Other liabilities 25 442,336 163,685 Total current liabilities 11,185,312 10,171,308 Non-current liabilities Borrowings 21 364,523 468,688 Lease liabilities 22 427,656 1,032,036 Deferred tax 8 1,647,374 2,170,975 Employee benefits 24 73,159 117,453 Other liabilities 25 1,730,010 983,179 Total non-current liabilities 4,242,722 4,772,331 Total liabilities 15,428,034 14,943,639 Net assets 24,381,000 32,493,487 Equity Issued capital 27 120,463,739 108,542,970 Reserves 28 3,399,268 2,711,168 Accumulated losses (99,482,007) (78,760,651) Total equity 24,381,000 32,493,487 Microba Life Sciences Limited Consolidated statement of financial position As at 30 June 2026 Note 2026 2025 $ $ The above consolidated statement of financial position should be read in conjunction with the accompanying notes 19 Assets Current assets Cash and cash equivalents 12 7,947,457 11,740,910 Receivables 13 3,206,620 4,109,379 Inventories 14 2,215,397 1,937,851 Other assets 16 517,468 1,074,551 Total current assets 13,886,942 18,862,691 Non-current assets Financial assets 15 264,529 138,644 Property, plant and equipment 17 1,156,322 2,018,149 Right-of-use assets 18 1,160,961 1,854,825 Intangible assets 19 23,340,280 24,562,817 Total non-current assets 25,922,092 28,574,435 Total assets 39,809,034 47,437,126 Liabilities Current liabilities Payables 20 4,693,401 5,520,863 Borrowings 21 2,376,837 746,496 Lease liabilities 22 935,565 982,428 Derivative financial instruments 23 28,864 - Employee benefits 24 791,370 915,855 Contract liabilities 26 1,882,635 1,828,510 Income tax payable 34,304 13,471 Other liabilities 25 442,336 163,685 Total current liabilities 11,185,312 10,171,308 Non-current liabilities Borrowings 21 364,523 468,688 Lease liabilities 22 427,656 1,032,036 Deferred tax 8 1,647,374 2,170,975 Employee benefits 24 73,159 117,453 Other liabilities 25 1,730,010 983,179 Total non-current liabilities 4,242,722 4,772,331 Total liabilities 15,428,034 14,943,639 Net assets 24,381,000 32,493,487 Equity Issued capital 27 120,463,739 108,542,970 Reserves 28 3,399,268 2,711,168 Accumulated losses (99,482,007) (78,760,651) Total equity 24,381,000 32,493,487
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49 FINANCIAL STATEMENTS Microba Life Sciences Limited Consolidated statement of changes in equity For the year ended 30 June 2026 The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes 20 Issued Share-based payment Foreign currency translation Accumulated Total equity capital reserve reserve losses $ $ $ $ $ Balance at 1 July 2024 102,881,628 2,118,660 36,894 (63,821,180) 41,216,002 Loss after income tax benefit for the year - - - (14,939,471) (14,939,471) Other comprehensive loss for the year, net of tax - - (258,680) - (258,680) Total comprehensive loss for the year - - (258,680) (14,939,471) (15,198,151) Transactions with owners in their capacity as owners: Contributions of equity, net of transaction costs (note 27) 5,661,342 - - - 5,661,342 Share-based payments (options) (note 29) - 814,294 - - 814,294 Balance at 30 June 2025 108,542,970 2,932,954 (221,786) (78,760,651) 32,493,487 Issued Share-based payment Foreign currency translation Accumulated Total equity capital reserve reserve losses $ $ $ $ $ Balance at 1 July 2025 108,542,970 2,932,954 (221,786) (78,760,651) 32,493,487 Loss after income tax benefit for the year - - - (20,721,356) (20,721,356) Other comprehensive loss for the year, net of tax - - (86,832) - (86,832) Total comprehensive loss for the year - - (86,832) (20,721,356) (20,808,188) Transactions with owners in their capacity as owners: Contributions of equity, net of transaction costs (note 27) 11,920,769 - - - 11,920,769 Share-based payments (options) (note 29) - 774,932 - - 774,932 Balance at 30 June 2026 120,463,739 3,707,886 (308,618) (99,482,007) 24,381,000 Microba Life Sciences Limited Consolidated statement of changes in equity For the year ended 30 June 2026 The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes 20 Issued Share-based payment Foreign currency translation Accumulated Total equity capital reserve reserve losses $ $ $ $ $ Balance at 1 July 2024 102,881,628 2,118,660 36,894 (63,821,180) 41,216,002 Loss after income tax benefit for the year - - - (14,939,471) (14,939,471) Other comprehensive loss for the year, net of tax - - (258,680) - (258,680) Total comprehensive loss for the year - - (258,680) (14,939,471) (15,198,151) Transactions with owners in their capacity as owners: Contributions of equity, net of transaction costs (note 27) 5,661,342 - - - 5,661,342 Share-based payments (options) (note 29) - 814,294 - - 814,294 Balance at 30 June 2025 108,542,970 2,932,954 (221,786) (78,760,651) 32,493,487 Issued Share-based payment Foreign currency translation Accumulated Total equity capital reserve reserve losses $ $ $ $ $ Balance at 1 July 2025 108,542,970 2,932,954 (221,786) (78,760,651) 32,493,487 Loss after income tax benefit for the year - - - (20,721,356) (20,721,356) Other comprehensive loss for the year, net of tax - - (86,832) - (86,832) Total comprehensive loss for the year - - (86,832) (20,721,356) (20,808,188) Transactions with owners in their capacity as owners: Contributions of equity, net of transaction costs (note 27) 11,920,769 - - - 11,920,769 Share-based payments (options) (note 29) - 774,932 - - 774,932 Balance at 30 June 2026 120,463,739 3,707,886 (308,618) (99,482,007) 24,381,000
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50 FINANCIAL STATEMENTS Microba Life Sciences Limited Consolidated statement of cash flows For the year ended 30 June 2026 Note 2026 2025 $ $ The above consolidated statement of cash flows should be read in conjunction with the accompanying notes 21 Cash flows from operating activities Receipts from customers 15,587,940 16,953,130 Payments to suppliers and employees (31,136,992) (35,782,618) (15,549,052) (18,829,488) Other income 85,593 95,658 Interest received 189,721 583,355 Subsidies and grants received 3,063,625 6,314,651 Interest and other finance costs paid 11 (153,153) (176,687) Income taxes paid (7,469) - Net cash used in operating activities 31 (12,370,735) (12,012,511) Cash flows from investing activities Payments for property, plant and equipment 17 (240,349) (326,386) Payments for intangible assets 19 (3,666,829) (2,572,984) Proceeds from disposal of financial assets - 65,792 Proceeds from disposal of property, plant and equipment 103,171 - Net cash used in investing activities (3,804,007) (2,833,578) Cash flows from financing activities Proceeds from issue of shares 27 13,021,216 6,046,002 Repayment of borrowings (665,242) (887,472) Principal portion of lease payments (941,527) (896,935) Proceeds from borrowings 2,058,409 1,707,269 Share issue transaction costs 27 (714,639) (384,660) Net cash from financing activities 12,758,217 5,584,204 Net decrease in cash and cash equivalents (3,416,525) (9,261,885) Cash and cash equivalents at the beginning of the financial year 11,740,910 20,889,451 Effects of exchange rate changes on cash and cash equivalents (376,928) 113,344 Cash and cash equivalents at the end of the financial year 12 7,947,457 11,740,910 Microba Life Sciences Limited Consolidated statement of cash flows For the year ended 30 June 2026 Note 2026 2025 $ $ The above consolidated statement of cash flows should be read in conjunction with the accompanying notes 21 Cash flows from operating activities Receipts from customers 15,587,940 16,953,130 Payments to suppliers and employees (31,136,992) (35,782,618) (15,549,052) (18,829,488) Other income 85,593 95,658 Interest received 189,721 583,355 Subsidies and grants received 3,063,625 6,314,651 Interest and other finance costs paid 11 (153,153) (176,687) Income taxes paid (7,469) - Net cash used in operating activities 31 (12,370,735) (12,012,511) Cash flows from investing activities Payments for property, plant and equipment 17 (240,349) (326,386) Payments for intangible assets 19 (3,666,829) (2,572,984) Proceeds from disposal of financial assets - 65,792 Proceeds from disposal of property, plant and equipment 103,171 - Net cash used in investing activities (3,804,007) (2,833,578) Cash flows from financing activities Proceeds from issue of shares 27 13,021,216 6,046,002 Repayment of borrowings (665,242) (887,472) Principal portion of lease payments (941,527) (896,935) Proceeds from borrowings 2,058,409 1,707,269 Share issue transaction costs 27 (714,639) (384,660) Net cash from financing activities 12,758,217 5,584,204 Net decrease in cash and cash equivalents (3,416,525) (9,261,885) Cash and cash equivalents at the beginning of the financial year 11,740,910 20,889,451 Effects of exchange rate changes on cash and cash equivalents (376,928) 113,344 Cash and cash equivalents at the end of the financial year 12 7,947,457 11,740,910
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51 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 22 Note 1. General information The financial statements cover Microba Life Sciences Limited as a consolidated group (referred to hereafter as the 'Group' or 'Microba') consisting of Microba Life Sciences Limited (referred to hereafter as the 'Company' or 'parent entity') and the entities it controlled at the end of, or during, the year. Microba Life Sciences Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business is Level 10, 324 Queen Street, Brisbane, Queensland, Australia. A description of the nature of the Group's operations and its principal activities are included in the Directors' report, whi ch is not part of the financial statements. The financial statements were authorised for issue, in accordance with a resolution of Directors, on 31 August 2026. The Directors have the power to amend and reissue the financial statements. Note 2. Material accounting policy information The accounting policies that are material to the Group are set out below. The accounting policies adopted are consistent with those of the previous financial year, unless otherwise stated. Basis of preparation These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB'), International Financial Reporting Standards ('IFRS') and the Corporations Act 2001, as appropriate for for-profit oriented entities. Historical cost convention The financial statements have been prepared under the historical cost convention, except for, where applicable, the revaluation to fair value of certain classes of assets and liabilities as described in the accounting policies. Critical accounting estimates The preparation of the financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed in note 3. Principles of consolidation The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Microba Life Sciences Limited ('Company' or 'parent entity') as at 30 June 2026 and the results of all subsidiaries for the year then ended. Microba Life Sciences Limited and its subsidiaries together are referred to in these financial statements as the 'Group' or 'Microba'. All inter-company balances and transactions, including any unrealised profits or losses have been eliminated on consolidation. Subsidiaries are consolidated from the date on which control is obtained by the Group and are derecognised from the date that control ceases. Rounding of amounts The Group is of a kind referred to in ASIC Corporations (Rounding in Financial/Directors' Reports) Instrument 2026/183 , issued by the Australian Securities and Investments Commission, relating to "rounding off". Amounts in this report have been rounded off in accordance with that Corporations Instrument to the nearest dollar. New or amended Accounting Standards and Interpretations not yet mandatory There are no standards, interpretations or amendments to existing standards that are effective for the first time for the financial year beginning 1 July 2025 that have a material impact on the amounts recognised in prior periods or will affect the current or future periods. New standards, amendments to standards and/or interpretations effective for reporting periods beginning on or after 1 July 2026 have not been early adopted in preparing these financial statements. None would have had a material effect on the consolidated financial statements.
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52 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 2. Material accounting policy information (continued) 23 Going concern The financial report has been prepared on a going concern basis, which assumes continuity of normal business activities and the realisation of assets and the settlement of liabilities in the ordinary course of business. The Group incurred a loss from ordinary activities of $20,721,356 during the year ended 30 June 2026 (2025: loss of $14,939,471) and has a net cash outflow from operating activities and lease repayments of $13,312,262 (2025 : $12,909,446). The Group held cash and cash equivalents of $7,947,457 at 30 June 2026 (2025: $11,740,910). During the financial year, the Company completed Tranche 2 of the FY2025 two‑tranche capital raise, securing approximately $8.5 million (before costs), which settled in August 2025. The Company subsequently completed Tranche 1 of a further two‑tranche capital raise, securing approximately $4.5 million (before costs) in June 2026. Subsequent to year ‑end, Tranche 2 of that raise secured a further $0.4 million (before costs) following shareholder approval at an Extraordinary General Meeting held on 24 July 2026, and the Company completed a Share Purchase Plan, raising an additional $0.4 million (before costs). This continued investor participation reflects the Company's ongoing ability to access capital markets as required. In considering the ability of the Group to continue as a going concern, the Directors considered the following matters: ● the Group has the ability to raise additional capital through a combination of funding sources, which may include debt and/or equity, and is well supported by its major and high‑quality shareholders; ● the Group will continue to rely on external capital raising until such time as revenues scale to a level sufficient to fund operating and corporate overhead cash outflows; ● the Group remains reliant on receiving cash inflows from the Commonwealth R&D Tax Incentive scheme, which provides a cash rebate of up to 43.5% for eligible R&D expenditure; ● the Group retains the ability to scale back discretionary and non ‑essential cash expenditure to preserve liquidity while suitable capital sources are identified and secured; and ● the Group has implemented measures to streamline operations to a lower cost base, with the objective of achieving full group break‑even in CY2027, and will monitor these initiatives and adopt changes as required to remain on track for that target. In the event the above initiatives do not materialise as planned, a material uncertainty exists that may cast significant dou bt on the Group's ability to continue as a going concern, and therefore the Group may be unable to realise its assets and discharge its liabilities in the normal course of business. After considering the matters described above, and having assessed the Group's forecast cash flows for the 12‑month period from the date of this report, the Directors believe there are reasonable grounds to expect that the Group will be able to continue as a going concern and that it is appropriate to prepare the financial statements on a going concern basis. Accordingly, the financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or to the amounts and classification of liabilities, that might be necessary should the Group not continue as a going concern. Foreign currency translation The financial statements are presented in Australian dollars, which is the Group's functional and presentation currency. Foreign currency transactions and balances Foreign currency transactions are translated into Australian dollars using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at financial year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss. Foreign operations The assets and liabilities of foreign subsidiaries are translated into Australian dollars using the exchange rates at the reporting date. The revenues and expenses of foreign operations are translated into Australian dollars using the exchange rate on the date of the transactions or the average exchange rates, which approximate the rates at the dates of the transactions, for the period. All resulting foreign exchange differences are recognised in other comprehensive income through the foreign currency reserve in equity.
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53 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 2. Material accounting policy information (continued) 24 Revenue recognition The Group recognises revenue as follows: Revenue from contracts with customers The Group recognises revenue at an amount that reflects the consideration to which the Group is expected to be entitled in exchange for fulfilling the performance obligation(s) agreed in the contract. Microba recognises revenue from contracts with customers as follows: Personal Testing & Supplements Transferred at a point in time Revenue from Personal Testing and Supplements which is recognised at a point in time is recognised when Microba’s performance obligation, being the delivery of a microbiome testing report or relevant supplements ordered are delivered to the customer, is satisfied. In instances where a microbiome testing kit is sold to a distributor, Microba recognises revenue attributable to the sale of the kit at the time of delivery to the distributor. Personal Testing Transferred over time Revenue from Personal Testing which is recognised over time is recognised as the agreed goods and services are delivered and the contracted performance obligations are met. Revenue is recorded at a value which reflects the relative stand-alone selling price of each distinct good or service, taking into consideration the transaction price of the contract, including variable consideration (if any). Where contracted minimum order quantities exist, revenue is recorded over time in alignment with the consumption of goods and services by the customer. In the instance it becomes likely that the customer will not exercise their remaining right to the contracted goods and services, the remaining contracted revenue will be recognised in accordance with the pattern of rights exercised by the customer during the contract period to date, and the expected future exercise of rights. Research Testing Recognised over time Revenue from Research Testing services contracts is recognised over time as the contracted services are delivered and the performance obligations are satisfied. The stand-alone selling price for each distinct (service) component of a relevant contract is determined and revenue is recognised to the extent of the performance obligation discharged. Contract liabilities A contract liability represents the Group's obligation to transfer goods or services to the customer for which the Group has received consideration (or an amount of consideration is due) from the customer. Amounts recorded as contract liabilities are subsequently recognised as revenue when the Group transfers the contracted goods and services to the customer. Other Income Interest Interest income is recognised as interest accrues using the effective interest method. Government grants Government grants are recognised when there is reasonable certainty that the grant will be received and all grant conditions are met. Grants relating to expense items are recognised as income over the periods necessary to match the grant to the costs they are compensating. Such periods will depend on whether costs are capitalised or expensed as incurred. Grants relating to capitalised development costs are recognised in Other liabilities (deferred government grants) and are recognised over the period necessary to match the grant income with the amortisation of the capitalised development costs.
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54 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 2. Material accounting policy information (continued) 25 The Group's research and development (R&D) activities are eligible under an Australian Government tax incentive for rebate of research and development expenditure. The R&D Tax Incentives for the Group are recognised as Government Grant Income and are recognised when there is a reasonable expectation that the Group will be able to realise the benefit and when the amount can be reliably estimated. Income tax The income tax expense or benefit for the period is the tax payable on that period's taxable income based on the applicable income tax rate for each jurisdiction, adjusted by the changes in deferred tax assets and liabilities attributable to tempora ry differences, unused tax losses and the adjustment recognised for prior periods, where applicable. Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to be applied when the assets are recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted, except f or when the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and that, at the time of the transaction, affects neither the accounting nor taxable profits. Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses. The carrying amount of recognised and unrecognised deferred tax assets are reviewed at each reporting date. Deferred tax assets recognised are reduced to the extent that it is no longer probable that future taxable profits will be available for t he carrying amount to be recovered. Previously unrecognised deferred tax assets are recognised to the extent that it is probable that there are future taxable profits available to recover the asset. Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets against current tax liabilities and deferred tax assets against deferred tax liabilities, and they relate to the same taxable author ity on either the same taxable entity or different taxable entities which intend to settle simultaneously. Tax consolidation The parent entity and its Australian subsidiaries have implemented the tax consolidation legislation and have formed a tax - consolidated group. This means that: ● each entity recognises their own current and deferred tax amounts in respect of the transactions, events and balances of the entity; and ● the parent entity assumes the current tax liability and any deferred tax assets relating to tax losses, arising in the subsidiary, and recognises a contribution to (or distribution from) the subsidiaries. Cash and cash equivalents Cash and cash equivalents includes cash at bank, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Cash under escrow held in the prior year has been recognised as Restricted Cash in the Consolidated Statement of Financial Position. Refer to note 12 for details. Receivables Receivables from contracts with customers are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less any allowance for expected credit losses. Trade receivables are generally due for settlement within 14-90 days. The Group has applied the simplified approach to measuring expected credit losses, which uses a lifetime expected loss allowance. To measure the expected credit losses, trade receivables have been grouped based on days overdue. Inventories Raw materials and finished goods are stated at the lower of cost and net realisable value on a 'weighted average' basis. Cost comprises of direct materials and delivery costs, direct labour, import duties and other taxes. Costs of purchased inventory are determined after deducting rebates and discounts received or receivable.
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55 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 2. Material accounting policy information (continued) 26 Derivative financial instruments Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured to their fair value at each reporting date. The accounting for subsequent changes in fair value depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged. Derivatives are classified as current or non-current depending on the expected period of realisation. Derivative financial instruments – options issued Options issued by the Company that do not meet the definition of an equity instrument under AASB 132 Financial Instruments: Presentation are classified as derivative financial liabilities. These instruments are measured at fair value on initial recognition and are subsequently remeasured to fair value at each reporting date, with changes in fair value recognised in profit or loss. Property, plant and equipment Plant and equipment is stated at historical cost less accumulated depreciation and impairment. Historical cost includes expenditure that is directly attributable to the acquisition of the items. Depreciation is calculated on a diminishing value basis to write off the net cost of each item of property, plant and equipment (excluding land) using their respective allocated rates as follows: Furniture, fixtures and fittings at cost 5%-20% Computer equipment at cost 20%-50% Laboratory equipment at cost 10%-25% The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting date. An item of property, plant and equipment is derecognised upon disposal or when there is no future economic benefit to the Group. Gains and losses between the carrying amount and the disposal proceeds are taken to profit or loss. Intangible assets Intangible assets acquired as part of a business combination, other than goodwill, are initially measured at their fair value at the date of the acquisition. Intangible assets acquired separately are initially recognised at cost. Indefinite life intangible assets are not amortised and are subsequently measured at cost less any impairment. Finite life intangible assets are subsequently measured at cost less amortisation and any impairment. The gains or losses recognised in profit or loss arising from the derecognition of intangible assets are measured as the difference between net disposal proceeds and the carrying amount of the intangible asset. The method and useful lives of finite life intangible assets are reviewed annually. Changes in the expected pattern of consumption or useful life are accounted for prospectively by changing the amortisation method or period. Goodwill Goodwill arises on the acquisition of a business. Goodwill is not amortised. Instead, goodwill is tested annually for impairment, or more frequently if events or changes in circumstances indicate that it might be impaired, and is carried at cost less accumulated impairment losses. Impairment losses on goodwill are taken to profit or loss and are not subsequently reversed. Brand Brand acquired in a business combination is amortised on a straight -line basis over the period of its expected benefit, being its finite life of 15 years. Customer relationships Customer relationships acquired in a business combination are amortised on a straight -line basis over the period of their expected benefit, being their finite life of 15 years.
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56 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 2. Material accounting policy information (continued) 27 Technology Technology acquired in a business combination is amortised on a straight-line basis over the period of its expected benefit as follows: Technology (Testing Kits) - 5 years Technology (Supplements) - 15 years System development costs, product development costs and intellectual property Costs incurred in developing Microba's proprietary platforms, products and intellectual property are capitalised when the Group can demonstrate all of the following: ● the technical feasibility of completing the asset so that it will be available for use or sale; ● the intention to complete the asset and use or sell it; ● the ability to use or sell the asset; ● how the asset will generate probable future economic benefits; ● the availability of adequate technical, financial and other resources to complete the development and to use or sell the asset; and ● the ability to measure reliably the expenditure attributable to the asset during its development. Capitalised development costs for systems and products, and intellectual property, are amortised over their estimated useful lives of 4 years on a straight -line, and 8 years on a diminishing value basis respectively, commencing when the asset is available for use (i.e. when it is in the location and condition necessary for it to be capable of operating in the manner intended by management). The amortisation method applied to an intangible asset is consistent with the estimated consumption of economic benefits of the asset. All carrying values of intangible assets are assessed for impairment annually, or more frequently if events or changes in circumstances indicate that the assets may be impaired. Subsequent to initial recognition, costs recognised as an intangible asset are measured at cost, less accumulated amortisation and any accumulated impairment losses. Research and development expenditure Expenditure on research activities is recognised as an expense when incurred. Development expenditure which does not meet the recognition requirements for intangible assets, as disclosed above, is recognised as an expense when incurred. Impairment of non-financial assets Non-financial assets are reviewed for impairment annually or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. Recoverable amount is the higher of an asset's fair value less costs of disposal and value -in-use. The value -in-use is the present value of the estimated future cash flows relating to the asset using a pre -tax discount rate specific to the asset or cash-generating unit to which the asset belongs. Assets that do not have independent cash flows are grouped together to form a cash-generating unit. Impairment losses in respect of individual assets are recognised immediately in profit or loss unless the asset is measured at a revalued amount, in which case the impairment loss is treated as a revaluation decrease and is recognised in other comprehensive income to the extent that it does not exceed the amount in the revaluation surplus for the same asset. Fair value measurement When an asset or liability, financial or non -financial, is measured at fair value for recognition or disclosure purposes, the fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date; and assumes that the transaction will take place either: in the principal market; or in the absence of a principal market, in the most advantageous market.
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57 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 2. Material accounting policy information (continued) 28 Fair value is measured using the assumptions that market participants would use when pricing the asset or liability, assuming they act in their economic best interests. For non-financial assets, the fair value measurement is based on its highest and best use. Valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, are used, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. Issued capital Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. Note 3. Critical accounting judgements, estimates and assumptions The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions on historical experience and on other various factors, including expectations of future events, management believes to be reasonable under the circumstances. The judgements, estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are discussed below. Capitalisation of system and product development costs and intellectual property Intellectual property and development projects where knowledge and understanding gained from research and practical experience are directed towards developing new products, service offerings or processes, are recognised as intangible assets in the Consolidated Statement of Financial Position when they meet the criteria for capitalisation. Development costs may be capitalised if the Group can demonstrate the technical and commercial feasibility of completing the service offering, product or process, as well as the intention and ability to complete the development and use or sell the asset. It must also be probable that future economic benefits related to the asset will flow to the Group and the acquisition cost is able to be reliably measured. The reported value includes all directly attributable costs, such as those for materials and services as well as compensation to employees. Individual assessment is made of major ongoing research and development projects to determine whether these criteria have been met. Assessment of these various projects is affected by significant judgement. Share-based payment transactions The Group measures the cost of equity -settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined by using the Black -Scholes model taking into account the terms and conditions upon which the instruments were granted. The accounting estimates and assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts of assets and liabilities within the next annual reporting period but may impact profit or loss and equity. Revenue from contracts with customers Determining the timing and amount of revenue recognition from complex contracts with customers requires management to exercise judgement in relation to the timing of the fulfilment of performance obligations and the allocation of the transacti on price to those specific performance obligations. Fair value measurement hierarchy The Group is required to classify all assets and liabilities, measured at fair value, using a three level hierarchy, based on the lowest level of input that is significant to the entire fair value measurement, being: Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date; Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; and Leve l 3: Unobservable inputs for the asset or liability. Considerable judgement is required to determine what is significant to fair value and therefore which category the asset or liability is placed in can be subjective. The fair value of assets and liabilities classified as level 3 is determined by the use of valuation models. These include discounted cash flow analysis or the use of observable inputs that require significant adjustments based on unobservable inputs.
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58 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 3. Critical accounting judgements, estimates and assumptions (continued) 29 Estimation of useful lives of assets The Group determines the estimated useful lives and related depreciation and amortisation charges for its property, plant and equipment and finite life intangible assets. The useful lives could change significantly as a result of technical innovations or some other event. The depreciation and amortisation charge will increase where the useful lives are less than previously estimated lives, or technically obsolete or non-strategic assets that have been abandoned or sold will be written off or written down. Impairment of goodwill The Group tests whether goodwill has been impaired on an annual basis. Management judgement is applied to identify the relevant cash generating unit (CGU). The recoverable amount of a CGU is determined based on value ‑in‑use calculations, which require the use of assumptions and discounting of future cash flows. These assumptions are based on best estimates at the time of performing the valuation. Cash flow projections do not include restructuring activities that the Group is not yet committed to or significant future investments that will enhance the performance of the assets of the CGU being tested. Goodwill is monitored by management at the level of operating segments identified in note 38. Impairment of non-financial assets other than goodwill and other indefinite life intangible assets The Group assesses impairment of non-financial assets other than goodwill and other indefinite life intangible assets at each reporting date by evaluating conditions specific to the Group and to the particular asset that may lead to impairment. If an impairment trigger exists, the recoverable amount of the asset is determined. During the period, the Group assessed the carrying value of its testing kit technology intangible assets following the discontinuation of the Ecologix product range. The determination of recoverable amount requires the exercise of judgement, including an assessment of whether future economic benefits are expected to arise from the underlying technology. As a result of this assessment, an impairment loss was recognised to reduce the carrying amount of the relevant technology assets to nil (refer to note 19). Management has also considered the recoverability of the remaining intangible assets and is satisfied that their carrying values are supported by expected future economic benefits. Research and Development ('R&D') Tax Incentive The Group lodges annual returns to claim eligible expenditure under the R&D Tax Incentive scheme with the Australian Government. The application of the R&D provisions and the corresponding recognition in the balance sheet of the receivable and grant income in the profit or loss, requires a level of judgement and the maintenance of appropriate records to support amounts claimed. Recovery of deferred tax assets Deferred tax assets are recognised for deductible temporary differences only if the Group considers it is probable that futur e taxable amounts will be available to utilise those temporary differences and losses. Deferred tax assets have been reversed due to the loss making position of the Group. At present, there are no deferred tax assets recognised owing to the ongoing losses incurred to date and uncertainty around the expectation of profits going forward. Note 4. Revenue from contracts with customers 2026 2025 $ $ Personal testing and supplements - revenue recognised at a point in time 13,911,652 13,741,075 Personal testing - revenue recognised over time 601,996 547,866 Research testing - revenue recognised over time 244,813 1,380,148 14,758,461 15,669,089 Please refer to note 38 - operating segments for a geographical disaggregation of revenues.
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59 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 30 Note 5. Grant and subsidies income 2026 2025 $ $ Research and Development Tax Incentive 1,105,398 2,506,277 Other grant and subsidies income - 324,600 Grant and subsidies income 1,105,398 2,830,877 Note 6. Net gain on derecognition of contingent consideration payable 2026 2025 $ $ Net gain on derecognition of contingent consideration payable - 4,469,548 The contingent consideration payable is a pre-determined fixed sum that will be disbursed to the previous shareholders of Invivo Clinical Limited, comprising both cash and shares. This payment is contingent upon the attainment of specific revenue targets in both Year 1 and Year 2 of the company's operation post acquisition. The targets for Year 1 were missed on the anniversary date of the acquisition. An assessment of the Year 2 targets was undertaken and management were of the opinion that the targets for Year 2 will not be achieved. Owing to this an amount of $4,469,548 has been credited to the statement of profit or loss and other comprehensive income at 30 June 2025. Note 7. Foreign Currency Gain/(loss) 2026 2025 $ $ Realised currency gain 96,739 104,205 Unrealised currency gain (loss) (1,602,674) 1,655,562 (1,505,935) 1,759,767 Realised gains represent profits arising from foreign currency transactions settled in cash or cash equivalents during the normal course of business operations. Unrealised gains (losses) primarily reflect fair value adjustments resulting from the revaluation of intercompany loans denominated in foreign currencies. These loans have fixed repayment terms and are subject to monthly revaluations at fair value, with movements recognised directly through the profit or loss in accordance with AASB 9 - Financial Instruments. The resulting unrealised gains (losses) remain subject to future fluctuation until settlement or maturity of the underlying finan cial instruments. Note 8. Income tax Components of tax expense 2026 2025 $ $ Current tax expense 7,469 17,258 Deferred tax expense (167,057) (256,611) Under / (Over) provision in prior years (103,024) 132,759 Income tax expense / (benefit) (262,612) (106,594)
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60 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 8. Income tax (continued) 31 Income tax reconciliation 2026 2025 $ $ Prima facie tax payable on profit before income tax is reconciled to the income tax expense as follows: Prima facie income tax on loss before tax at 25.00% (2025: 25.00%) (5,245,992) (3,761,516) Add tax effect of: Share-based payments 193,733 203,574 Accounting expense subject to R&D Tax Incentive 593,785 1,760,704 R&D Tax Incentive revenue (276,350) (627,379) Other 696 (343,248) Fair value gain on reversal of contingent consideration - (1,117,387) Under/(over) provision in prior years (103,024) 132,759 Non-assessable income (89,236) - Derecognition of current year tax losses and temporary differences 4,663,776 3,645,899 4,983,380 3,654,922 Income tax expense / (benefit) (262,612) (106,594) Deferred tax 2026 2025 $ $ The balance comprises: Deferred tax assets: Employee benefits 216,133 258,327 Accruals and other liabilities 278,128 438,556 Lease liabilities 340,805 475,921 Unrealised foreign currency 398,533 - Section 40-880 blackhole expenditure 462,600 542,201 Intangible assets - 578,745 Carried forward tax losses 17,224,007 12,603,171 18,920,206 14,896,921 Deferred tax liabilities: Intangible assets (1,675,245) (2,209,123) Right of use assets (290,240) (460,140) Property, plant and equipment (49,772) (63,999) Prepayments (117,975) (220,213) Unrealised foreign currency - (442,245) (2,133,232) (3,395,720) Net deferred tax asset before derecognition 16,786,974 11,501,201 Derecognition of deferred tax asset* (18,434,348) (13,672,176) Net deferred tax asset/(liability) (1,647,374) (2,170,975)
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61 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 8. Income tax (continued) 32 *Tax losses and deductible temporary differences not recognised The Group has not recognised deferred tax balances due to the uncertainty of losses and future deductible temporary tax differences being recovered in future periods. The deferred tax asset relating to unused tax losses not recognised is $17,224,007 (2025: $12,603,171). Deferred income tax (revenue)/expense included in income tax expense comprises: 2026 2025 $ $ Decrease / (increase) in deferred tax assets 917,548 (588,616) (Decrease) / increase in deferred tax liabilities (1,084,605) 332,005 (167,057) (256,611) Deferred income tax related to items charged or credited directly to equity: 2026 2025 $ $ Decrease / (increase) in deferred tax assets (178,661) (76,932) (Decrease) / increase in deferred tax liabilities (177,883) 295,442 (356,544) 218,510 Franking credits 2026 2025 $ $ Franking credits available for subsequent reporting periods based on a tax rate of 25% (2025:25%) - - The above amount represents the balance of the franking account at the end of the reporting period, adjusted for franking credits and debits that will arise from the settlement of amounts recognised as tax receivable or payable, and from dividends recognised as a liability, at the reporting date. The Group has no franking credits available as at 30 June 2026 (2025: nil), reflecting its carried-forward tax loss position and that no Australian income tax generating franking credits has been paid. Note 9. Employee benefits and other related costs 2026 2025 $ $ Short term benefits 10,783,260 12,549,902 Share-based payments 774,932 814,294 Superannuation guarantee contributions 1,378,147 1,359,875 Other employee benefits and related costs 1,417,734 1,761,493 14,354,073 16,485,564
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62 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 33 Note 10. Depreciation and amortisation expense 2026 2025 $ $ Depreciation expense - property, plant and equipment 876,811 1,225,663 Depreciation expense - right of use assets 943,250 896,414 Amortisation expense - intangible assets 2,591,340 2,309,097 4,411,401 4,431,174 Note 11. Finance costs 2026 2025 $ $ Interest expense - premium funding 8,177 12,972 Interest expense - equipment loan 60,897 90,717 Interest expense on lease liability 79,975 72,778 Interest expense - R&D funding 85,406 - Other interest expense 4,102 220 238,557 176,687 Note 12. Cash and cash equivalents 2026 2025 $ $ Cash at bank 7,947,457 8,025,910 Cash on deposit - 2,715,000 Restricted cash - 1,000,000 7,947,457 11,740,910 A term deposit of $1,000,000 was classified as restricted cash in prior year as stipulated under the funding agreement with Westpac Banking Corporation on 18 July 2024 which was established to purchase a "NovaseqX" sequencing machine, bringing significantly advanced sequencing technology to the Group. The term deposit will be held for the duration of the agreement (36 months). During the current year the cash became unrestricted as the funding was renegotiated. Note 13. Receivables 2026 2025 $ $ Current assets Receivables from contracts with customers 741,245 458,520 Contract assets from contracts with customers 99,917 371,443 Research and development tax incentive receivable 2,135,829 3,066,681 Other receivables 229,629 212,735 3,206,620 4,109,379 The Group's exposure to credit and currency risk and expected credit losses related to receivables held are disclosed in note 30.
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63 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 13. Receivables (continued) 34 Reconciliation of the allowance for expected credit losses As at 30 June 2026 the Group holds no allowance for expected credit losses (30 June 2025: nil). The allowance carried at the start of the comparative period was fully extinguished during the year ended 30 June 2025 through recoveries and the write - off of the related receivables. Applying the AASB 9 simplified approach, no material expected credit loss has been identified at 30 June 2026, reflecting the short-dated nature and low credit risk of the Group's trade receivables. Note 14. Inventories 2026 2025 $ $ Current assets Raw materials and consumables - at cost 1,508,416 1,166,866 Stock on hand - at cost 706,981 770,985 2,215,397 1,937,851 Note 15. Financial assets 2026 2025 $ $ Non-current assets Cash on deposit 264,529 138,644 Note 16. Other assets 2026 2025 $ $ Prepayments 517,468 880,853 Other current assets - 193,698 517,468 1,074,551 Note 17. Property, plant and equipment 2026 2025 $ $ Non-current assets Laboratory equipment at cost 5,812,276 6,286,397 Accumulated depreciation (4,859,850) (4,593,034) 952,426 1,693,363 Furniture, fixtures and fittings at cost 113,899 180,923 Accumulated depreciation (68,424) (108,445) 45,475 72,478 Computer equipment at cost 595,770 695,573 Accumulated depreciation (437,349) (443,265) 158,421 252,308 Total property, plant and equipment 1,156,322 2,018,149
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64 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 17. Property, plant and equipment (continued) 35 Reconciliations Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out below: Laboratory equipment Furniture, fixtures and fittings Computer equipment Total $ $ $ $ Balance at 1 July 2024 2,653,578 59,924 164,779 2,878,281 Additions 116,199 23,872 186,315 326,386 Disposals (1,843) - - (1,843) Exchange differences 28,097 2,952 9,939 40,988 Depreciation expense (1,102,668) (14,270) (108,725) (1,225,663) Balance at 30 June 2025 1,693,363 72,478 252,308 2,018,149 Additions 165,273 1,645 31,724 198,642 Disposals (162,156) (15,686) (22,609) (200,451) Exchange differences (8,864) (358) (7,899) (17,121) Transfers in/(out) 33,914 - - 33,914 Depreciation expense (769,104) (12,604) (95,103) (876,811) Balance at 30 June 2026 952,426 45,475 158,421 1,156,322 Note 18. Right-of-use assets 2026 2025 $ $ Non-current assets Buildings - right-of-use 4,434,870 4,383,441 Less: Accumulated depreciation (3,317,419) (2,572,922) 1,117,451 1,810,519 Laboratory Equipment - 72,744 Less: Accumulated depreciation - (28,438) - 44,306 Motor Vehicles 45,673 - Less: Accumulated depreciation (2,163) - 43,510 - Total carrying amount of lease assets 1,160,961 1,854,825
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65 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 18. Right-of-use assets (continued) 36 Reconciliations Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out below: Buildings Laboratory Equipment Motor Vehicles Total $ $ $ $ Balance at 1 July 2024 977,539 54,698 - 1,032,237 Additions 1,811,027 - - 1,811,027 Disposals (138,976) - - (138,976) Exchange differences 46,951 - - 46,951 Depreciation expense (886,022) (10,392) - (896,414) Balance at 30 June 2025 1,810,519 44,306 - 1,854,825 Additions 523,178 - 44,634 567,812 Disposals (252,769) - - (252,769) Exchange differences (32,880) - 1,137 (31,743) Transfers in/(out) - (33,914) - (33,914) Depreciation expense (930,597) (10,392) (2,261) (943,250) Balance at 30 June 2026 1,117,451 - 43,510 1,160,961 The Group leases office and laboratory spaces under separate lease agreements. These leases have a term of between 1 and 6 years, with CPI and/or fixed increases to be applied each year. On renewal, the terms of the relevant leases are renegotiated by the Group. The Group also holds a lease over Laboratory Equipment with a 3 year term. The lease costs are fixed for the term of the agreement and ownership of the underlying assets will transfer to the Group at the conclusion of the lease. During the year the Group recognised right-of-use additions of $567,812. Property additions of $523,178 relate to a new lease at TRI and a new UK lease for the Invivo business. Motor vehicle additions of $44,634 relate to employee electric vehicles provided under a UK arrangement that meets the definition of a lease under AASB 16. The disposal of $252,769 reflects the early termination of a UK property lease during the year. The laboratory equipment right-of-use asset was reclassified to property, plant and equipment during the year, as ownership transfers to the Group at the end of the lease term.
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66 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 37 Note 19. Intangible assets 2026 2025 $ $ Non-current assets Goodwill 9,198,124 10,019,053 Capitalised system development at cost 7,173,489 5,247,927 Accumulated amortisation (3,890,112) (2,912,497) 3,283,377 2,335,430 Intellectual property at cost 824,215 775,799 Accumulated amortisation (457,852) (389,156) 366,363 386,643 Customer relationships at fair value 2,102,468 2,290,113 Accumulated amortisation (360,208) (239,682) 1,742,260 2,050,431 Technology at fair value 1,896,602 2,838,590 Accumulated amortisation (740,217) (573,089) 1,156,385 2,265,501 Capitalised product development at cost 5,654,261 4,173,038 Accumulated amortisation (1,771,973) (1,035,247) 3,882,288 3,137,791 Brand at fair value 4,478,822 4,878,555 Accumulated amortisation (767,339) (510,587) 3,711,483 4,367,968 Total intangible assets 23,340,280 24,562,817
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67 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 19. Intangible assets (continued) 38 Goodwill Capitalised system development Intellectual property Customer relationshi ps Technolog y Capitalised product development Brand Total $ $ $ $ $ $ $ $ Balance at 1 July 2024 9,094,222 3,037,347 327,024 1,999,743 2,387,731 1,417,985 4,259,988 22,524,040 Additions - 204,500 158,031 - - 2,210,453 - 2,572,984 Exchange differences 924,831 3,385 - 197,435 228,648 - 420,591 1,774,890 Amortisation expense - (909,802) (98,412) (146,747) (350,878) (490,647) (312,611) (2,309,097) Balance at 30 June 2025 10,019,053 2,335,430 386,643 2,050,431 2,265,501 3,137,791 4,367,968 24,562,817 Additions - 883,724 136,969 - - 2,646,136 - 3,666,829 Disposals - (8,027) (62,479) - - - - (70,506) Exchange differences (820,929) (10,966) - (162,572) (141,246) - (346,322) (1,482,035) Impairment of assets - - - - (745,485) - - (745,485) Transfers in/(out) - 1,164,912 - - - (1,164,912) - - Amortisation expense - (1,081,696) (94,770) (145,599) (222,385) (736,727) (310,163) (2,591,340) Balance at 30 June 2026 9,198,124 3,283,377 366,363 1,742,260 1,156,385 3,882,288 3,711,483 23,340,280 Impairment test for goodwill Goodwill is tested annually for impairment. At 30 June 2026, the Directors used a Value in Use (VIU) approach to assess the carrying value of goodwill. No impairment was recognised by the Group. For impairment testing, the Group considers its previous business combination of Invivo Clinical, which resulted in goodwill upon acquisition, to be a synergistic opportunity for its testing and supplements operating segment. Therefore, the Group has allocated this goodwill upon acquisition entirely to the testing and supplements cash generating unit (CGU), which is also an operating and reportable segment. The recoverable amount of the testing and supplements CGU has been determined based on a calculation using cash flow projections over a five -year period. Cash flows beyond the five -year forecast period are extrapolated using the estimated terminal growth rate.
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68 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 19. Intangible assets (continued) 39 Impairment of other (finite-life) intangible assets The Group's other intangible assets — customer relationships, brand, intellectual property, capitalised development and technology — have finite useful lives and are amortised. In accordance with AASB 136, these are assessed for indicators of impairment at each reporting date and tested only where an indicator exists. During the year an impairment indicator was identified in respect of the testing -kit technology acquired with Invivo Clinical, being the discontinuation of the associated Ecologix range in the UK and its replacement with the Microbiome Explorer range. The recoverable amount of that technology was assessed and an impairment loss of $745,485 was recognised, reducing its carrying amount to nil. No impairment indicators were identified for the Group's other finite-life intangible assets. These assets form part of the Testing & Supplements cash -generating unit, the recoverable amount of which was assessed as part of the annual goodwill impairment t est and exceeded its carrying amount; accordingly, no separate impairment testing was required and no impairment was recognised. Key assumptions used for value-in-use calculations The key assumptions for the testing and supplements CGU supporting the disclosed recoverable value are as follows: ● Revenue for the first year of the forecast (FY27) is based on the financial budget approved by the board of directors, reflecting growth of 43.6% on the prior year; ● beyond the budget year, revenue is forecast to grow at a compound annual growth rate (CAGR) of 27.4% (2025: 54.4%) from FY27 to FY31, representing a CAGR of 30.4% across the full forecast period (FY26 to FY31). The projections incorporate increased test volumes, an improved sales mix and targeted price increases, supported by growing clinical adoption in Australia and the early -stage penetration of the UK market. Management's assumptions are grounded in a bottom-up, unit-level analysis based on the estimate d number of clinicians in the market, market penetration rates and average referrer rates per active clinician, consistent with Microba's historical experience. Historical core revenue growth from FY24 to FY26 represented a CAGR of 58%, which exceeds the g rowth rate forecast over the projection period. EBITDA is forecast to improve from a loss in the early years of the forecast to a positive contribution as test volumes scale and per -test sequencing and direct labour costs reduce, reflecting operational lev erage as the CGU grows. Management has also included appropriate allocations of certain previously "unallocated" corporate costs to the Testing & Supplements CGU on a rational and consistent basis; ● a post tax discount rate of 15.8% (2025: 15%); and ● terminal growth rate of 2.5% (2025: 3%) at the end of the forecast period. The revenue growth rates beyond the budget year and the terminal growth rate ranges are derived from management's best estimate of revenue and operating expenditure growth, taking into account changes in industry, customer market prospects, future product developments and technological innovation. The discount rate represents the current market assessment of the risks specific to the CGU, taking into consideration the time value of money coupled with other risk factors. It is based on the Group's weighted average cost of capital. Results of impairment testing and sensitivity to changes in assumptions The VIU calculation indicates that the recoverable amount of the testing and supplements CGU is greater than the carrying value of the CGU, and therefore no impairment was recognised by the Group. The following table sets out key parameters that need to change for there to be no headroom available when comparing the calculation of the estimated recoverable amount of the CGU against the carrying value of the CGU at 30 June 2026: 2026 2025 Change required for carrying amount to equal recoverable amount % % Discount rate increase 4.7% 6.7% Budgeted EBITDA growth rate decline (15.0%) (86.7%) Revenue growth rate decline (12.0%) (11.9%)
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69 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 19. Intangible assets (continued) 40 The Directors and management have considered and assessed reasonably possible changes for other key assumptions and have not identified any instances that could cause the carrying amount of testing and supplements CGU to exceed its recoverable amount. Note 20. Payables 2026 2025 $ $ Current liabilities Trade creditors 2,635,885 2,352,662 Employee payables and accruals 1,086,777 1,254,461 Sundry creditors and accruals 970,739 1,913,740 4,693,401 5,520,863 Refer to note 30 for further information on financial risk management objectives and policies. Note 21. Borrowings 2026 2025 $ $ Current liabilities Equipment loan 198,171 428,338 Credit card liability - unsecured 47,601 - Insurance premium funding - 318,158 R&D Funding Loan 2,131,065 - 2,376,837 746,496 Non-current liabilities Equipment loan 364,523 468,688 2,741,360 1,215,184 Refer to note 30 for further information on financial risk management objectives and policies. Equipment loan A funding arrangement was entered into with Westpac to refinance the purchase a state of the art Illumina NovaSeqX Plus DNA sequencing machine, the funding was secured against the machine. The previous funding arrangement was fully paid out on the 30 March 2026 and a new arrangement entered into with Westpac. The new loan amount of $629k was funded on the 30 March, which is repayable over 36 equal monthly instalments, with a fixed interest rate of 7.39%. The new NovaSeqX Plus funding is secured against the machine. The maturity date is 31 March 2029. R&D funding The Group's FY26 R&D tax refund has been advanced under a secured funding arrangement with Innovation Structured Finance Co., LLC (Radium Capital) — aggregate principal of approximately $2.05 million across two advances, at a fixed interest rate of 16.00% per annum, maturing 31 January 2027. The borrower is Microba Life Sciences Limited. The facility is secured by (i) a specific security over the Group's present and future right, title and interest in the FY26 R&D tax refund, and (ii) a featherweight security over the assets of Microba Life Sciences Limited a limited floating charge enforceable only upo n the appointme nt of an administrator. The facility is guaranteed by Microba Pty Ltd, a wholly -owned subsidiary, under a guarantee and indemnity in favour of the lender (eliminated on consolidation). No general security agreement over the Group's assets has been provided.
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70 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 41 Note 22. Lease liabilities 2026 2025 $ $ Current liabilities Lease liability 935,565 982,428 Non-current liabilities Lease liability 427,656 1,032,036 1,363,221 2,014,464 The Group’s lease liabilities include an immaterial amount relating to make good obligations on leased premises, which have been recognised in accordance with AASB 137. Due to the immateriality of these amounts, they have been classified within lease liabilities on the balance sheet. 2026 2025 $ $ Cash outflow in relation to leases 941,527 896,935 Note 23. Derivative financial instruments 2026 2025 $ $ Current liabilities Derivative Liability 28,864 - 2026 2025 $ $ Balance at 1 July 2025 - - Recognised on grant of options (initial fair value) 385,808 - Fair value gain recognised in profit or loss (356,944) - Balance at 30 June 2026 28,864 - Refer to note 30 for further information on financial risk management objectives and policies. The derivative financial liability relates to attaching options issued to Sonic Healthcare Limited. The number of shares to be issued upon exercise of the options is variable, as it is determined based on a VWAP formula and a fixed cash amount of $4,166,667. As a result, the options do not meet the “fixed -for-fixed” criterion under AASB 132 and are therefore classified as a derivative financial liability. The derivative liability is initially recognised at fair value on the grant date and subsequently remeasured to fair value at each reporting date. Fair value has been determined using a Monte Carlo valuation methodology. The movement in fair value of $356,944 for the period 30 June 2026 has been recognised as a gain in the consolidated statement of profit or loss and other comprehensive income.
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71 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 42 Note 24. Employee benefits 2026 2025 $ $ Current liabilities Employee benefits 791,370 915,855 Non-current liabilities Employee benefits 73,159 117,453 864,529 1,033,308 Note 25. Other liabilities 2026 2025 $ $ Current liabilities Deferred Government Grants - R&D Tax Incentive 440,675 160,131 Novated lease liability 1,661 3,554 442,336 163,685 Non-current liabilities Deferred Government Grants - R&D Tax Incentive 1,730,010 983,179 2,172,346 1,146,864 Note 26. Contract liabilities 2026 2025 $ $ Current liabilities Contracts with customers where services are transferred at a point in time 1,828,793 1,459,001 Contracts with customers where services are transferred over time 53,842 369,509 1,882,635 1,828,510 Performance obligations related to the consideration received in advance are expected to be fulfilled within 12 months. 2026 2025 $ $ Reconciliation of contract liabilities: Opening balance 1,828,510 2,182,071 Revenue recognised during the year (9,337,173) (8,926,061) Advance payments received 9,331,903 8,498,948 FX movement 59,395 73,552 Closing balance 1,882,635 1,828,510
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72 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 43 Note 27. Issued capital 2026 2025 2026 2025 Shares Shares $ $ Ordinary shares - fully paid 700,307,489 515,029,773 120,463,739 108,542,970 Movements in ordinary share capital Details Date Shares Issue Price $ Balance 01/07/2024 447,851,977 102,881,628 Ordinary shares issued 27/06/2025 67,177,796 $0.090 6,046,002 Capital raising costs 27/06/2025 - $0.000 (384,660) Balance 30/06/2025 515,029,773 108,542,970 Ordinary shares issued 13/08/2025 93,933,261 $0.090 8,453,993 Capital raising costs 13/08/2025 - $0.000 (400,379) Allocated to derivative liability instrument 13/08/2025 - $0.000 (385,808) Ordinary shares issued 18/06/2026 91,344,455 $0.050 4,567,223 Capital raising costs 18/06/2026 - $0.000 (314,260) Balance 30/06/2026 700,307,489 120,463,739 Issue/Exercise of options during the year During the year in accordance with their terms 69,444,384 options were issued at an exercise price of $0.14 for Tranche 1 and Tranche 2 participants who received one unlisted attaching option for every two new shares subscribed, expiring within 2 years from the date of issue. The SPP participants also received one unlisted attaching option for every two new shares subscribed, resulting in the issuance of 11,111,039 attaching options exercisable at $0.14 within two years from the date of issue. Further unlisted attaching options were issued to Sonic Healthcare Limited at an exercise price of at least $0.09 per option, with an expiry date 17 months from the date of issue. These options do not meet the definition of an equity instrument and have therefore been classified as a derivative liability. The options were measured at fair value on initial recognition using a Monte Carlo simulation model and are subsequently remeasured at fair value at each reporting date, with changes in fair value recognised in profit or loss. Refer to note 23 for further details. No options were exercised during the financial year ended 30 June 2026. Rights of each share type Ordinary shares participate in dividends and the proceeds on winding up of the parent entity in proportion to the numbers of shares held. At shareholders meetings each ordinary share is entitled to one vote when a poll is called. Share buy-back There is no current on-market share buy-back. Capital risk management The Group's objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can provide returns for shareholders, benefits for other stakeholders and to maintain an optimum capital structure to reduce the cost of capital. Capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. Net debt is calcula ted as total borrowings less cash and cash equivalents. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
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73 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 27. Issued capital (continued) 44 The Group would consider raising capital when an opportunity to invest in a business or company was seen as value adding relative to the current Company's share price at the time of the investment. Note 28. Reserves 2026 2025 $ $ Foreign currency translation reserve (308,618) (221,786) Share-based payments reserve 3,707,886 2,932,954 3,399,268 2,711,168 The foreign currency translation reserve is used to record the exchange differences arising on translation of a foreign entity. The share-based payments reserve is used to record the fair value of the shares or options issued to employees. Refer to note 29. Note 29. Share-based payments Equity-settled share-based payments Employee option plan The Group has approved an employee share and option plan titled the 'Microba Employee Share and Option Plan' ('ESOP') designed to provide eligible persons with the opportunity to participate at the discretion of the Directors. The shares and options issued under the plan are subject to vesting conditions and disposal restrictions. Options issued under the ESOP are issued at a premium to the last share issuance price to align employee and shareholder interests. Details of the options granted under the ESOP are provided below: 2026 Balance at Granted Exercised Forfeited/ Expired Balance at Exercise the start of during during during the end of Grant date Expiry date price the year the period the period the period the year 01/04/2021 04/04/2026 $0.324 3,066,666 - - (3,066,666) - 28/07/2023 28/07/2027 $0.453 6,145,000 - - - 6,145,000 28/07/2023 28/07/2027 $0.638 4,000,000 - - (2,000,000) 2,000,000 28/12/2023 28/01/2027 $0.271 200,000 - - - 200,000 10/02/2025 10/02/2029 $0.379 13,438,075 - - (3,367,564) 10,070,511 26,849,741 - - (8,434,230) 18,415,511
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74 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 29. Share-based payments (continued) 45 2025 Grant Date Expiry Date Exercise Price Balance at the start of the year Granted during the period Exercised during the period Forfeited during the period Balance at the end of the year 25/11/2019 24/11/2024 $0.288 4,300,000 - - (4,300,000) - 13/01/2020 24/11/2024 $0.243 400,000 - - (400,000) - 31/01/2020 24/11/2024 $0.288 200,000 - - (200,000) - 30/06/2020 29/06/2024 $0.288 266,666 - - (266,666) - 01/04/2021 04/04/2026 $0.324 3,233,332 - - (166,666) 3,066,666 05/04/2022 05/05/2025 $0.675 1,200,000 - - (1,200,000) - 28/07/2023 28/07/2027 $0.453 6,145,000 - - - 6,145,000 28/07/2023 28/07/2027 $0.638 4,000,000 - - - 4,000,000 28/12/2023 28/01/2027 $0.271 200,000 - - - 200,000 10/02/2025 10/02/2029 $0.379 - 13,438,075 - - 13,438,075 19,944,998 13,438,075 - (6,533,332) 26,849,741 Options granted to Directors and Employees under the ESOP are dependent on vesting conditions that vary by grant and may include continuous service, group revenue-growth CAGR and therapeutic-program milestones, as set out below. The average remaining contractual life of options outstanding at period end is 1.92 years (2025: 2.70 years). Grant Date Exercise Price Expiry Vesting conditions 01/04/2021 $0.324 04/04/2026 Service only - vests in thirds at 2, 3 and 4 years after issue (expired in FY26) 28/07/2023 $0.453 28/07/2027 Service; 50% no performance condition; 25% subject to Group revenue-growth CAGR (benchmarked against FY23); 25% subject to a therapeutic-program (Tx) milestone 28/07/2023 $0.638 28/07/2027 Service; 50% no performance condition; 25% subject to Group revenue-growth CAGR (benchmarked against FY23); 25% subject to a therapeutic-program (Tx) milestone 28/12/2023 $0.271 28/01/2027 Service only 10/02/2025 $0.379 10/02/2029 Service; 50% no performance condition; 50% subject to Group revenue-growth CAGR (three- year FY25 to FY27, benchmarked against FY24) Number of options Weighted average exercise price Number of options Weighted average exercise price 2026 2026 2025 2025 Outstanding at the beginning of the financial year 26,849,741 $0.428 19,944,998 $0.437 Granted - $0.000 13,438,075 $0.379 Forfeited (5,367,564) $0.476 (6,533,332) $0.355 Expired (3,066,666) $0.324 - $0.000 Outstanding at the end of the financial year 18,415,511 $0.431 26,849,741 $0.428 Exercisable at the end of the financial year 134,000 $0.271 3,433,666 $0.334 No options were granted during the current year. For the options granted during the previous financial year, the Black-Scholes valuation model inputs used to the fair value at the grant dates, are as follows:
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75 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 29. Share-based payments (continued) 46 2025 Grant Date Expiry Date Share price at grant date Exercise price Expected Volatility Dividend yield Risk-free interest rate Fair value at grant date 10/02/2025 10/02/2029 $0.300 $0.379 63.00% - 3.78% $0.130 The expected volatility used in the Black -Scholes option pricing model was determined primarily based on historical share price volatility of the Company and comparable peer companies. Given the limited trading history of Microba Life Sciences Limited, a group of comparable ASX-listed biotechnology and life sciences companies was selected to establish a reasonable volatility estimate. Historical volatility was calculated over a 4-year period ending 5 February 2025 using weekly price intervals. The resulting average equity volatility across the peer group over prior period was 63%, which was assessed to be reflective of expected future volatility and was adopted for the purpose of the valuation. Expenses recognised from share-based payment transactions The expense recognised in relation to the share-based payment transactions was recognised within employee benefit expense within the statement of profit or loss were as follows: 2026 2025 $ $ Options issued under ESOP 774,932 814,294 Total expenses recognised from share-based payment transactions 774,932 814,294 Note 30. Financial risk management objectives and policies Financial risk management objectives The Group has various financial instruments such as cash and cash equivalents, cash on deposit, trade receivables, trade payables, borrowings, lease liabilities, and contingent consideration payable which arise directly from its operations. It is, and has been throughout the period under review, the Group's policy that no trading in financial instruments shall be undertaken. The main risks arising from the Group's financial instruments are market risk (interest rate risk & foreign currency risk), credit risk, and liquidity risk. The Group's key management personnel oversee the management of these risks. The objective of the management of these risks is to support the delivery of the Group's financial targets while protecting future financial security. The Group uses different methods to measure and manage different types of risks to which it is exposed, as outlined below. Market risk Foreign currency risk The Group undertakes certain transactions denominated in foreign currency and is exposed to foreign currency risk through foreign exchange rate fluctuations. Foreign exchange risk arises from future commercial transactions and recognised financial assets and financial liabilities denominated in a currency that is not the entity's functional currency. The risk is measured using sensitivity analysis and cash flow forecasting. To protect against exchange rate movements, the Group monitors levels of foreign currency exposure and holds funds in foreign currencies to cover highly probable forecasted foreign currency cashflows occurring within the next six months.
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76 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 30. Financial risk management objectives and policies (continued) 47 The carrying amount of the Group's foreign currency denominated financial assets and financial liabilities at the reporting date were as follows: Assets Liabilities 2026 2025 2026 2025 $ $ $ $ US dollars 109,770 101,775 172,418 95,514 Swiss francs - - 5,279 5,882 Euros 88,067 134,187 34,658 - Canadian dollars - - 3,751 - Pound Sterling 784,143 1,196,922 29,787 1,283,199 Swedish Krona - - - 720,000 981,980 1,432,884 245,893 2,104,595 Based on this exposure, had the Australian dollar strengthened or weakened by 10% against these foreign currencies, the impact on the loss on the Group would have been an increase/decrease of $73,609 (2025: $24,064) and a corresponding increase/decrease in equity of the same amount. Interest rate risk The Group's main interest rate risk arises from cash and cash equivalents with floating interest rates. The Group's deposit accounts are subject to fixed interest rates, repricing periodically. The Group's transactional bank accounts are predominantly non-interest bearing. As at the reporting date, the Group had the following cash balances subject to interest income: 2026 2025 Weighted average interest rate Balance Weighted average interest rate Balance % $ % $ Cash and cash equivalents - interest bearing 3.28% 7,021,210 3.99% 7,363,212 Cash on deposit 4.75% 264,529 4.06% 2,715,000 Restricted cash - - 2.90% 1,000,000 Exposure to interest rate risk on cash deposits 7,285,739 11,078,212 At 30 June 2026 the Group's fixed-rate borrowings comprise an R&D funding facility and an equipment finance loan, bearing fixed interest rates of 16.00% (2025: nil) and 7.39% (2025: 8.52%) with terms of 10 months and three years respectively. The insurance premium funding arrangement held at 30 June 2025 (2.57%) was fully repaid during the year, with no balance outstanding at 30 June 2026. As these borrowings are at fixed rates and of short duration, the Group does not consider the interest rate risk arising from them to be material. The drawn amounts are expected to be repaid within their terms, and any re-draw is at management's discretion. Refer to note 21 for additional disclosure relating to the Group's borrowings. Due to the nature of the Group's interest exposure and the current market interest rates, a reasonable increase or decrease in the interest rate of 0.5% to 1.0% would not result in a significant increase/decrease in the net loss and equity position of the Group. Interest income earned on the Group's cash deposits was $315,606 (2025: $583,355) and interest expense was $238,557 (2025: $176,687). Management considers the interest rate risk to which the Group is exposed to be minimal and as such, does not enter into interest rate swaps or other derivatives relating to interest rate exposure.
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77 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 30. Financial risk management objectives and policies (continued) 48 Credit risk Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. The maximum exposure to credit risk at the reporting date to recognised financial assets is the carrying amount, net of any provisions for impairment of those assets, as disclosed in the Consolidated Statement of financial position and notes to the financial statements. The Group does not hold any collateral. Regular monitoring of receivables is undertaken to ensure that the credit exposure remains within the Group’s normal terms of trade. Trade receivables will generally be written off when there is no reasonable expectation of recovery, based on management's assessment. The Group holds cash in current and savings accounts with various large and reputable financial institutions in Australia, USA and Europe. The credit risk associated with these counterparties is considered negligible as these counterparties are reputable banks with high quality external credit ratings. The Parent has a policy of lending to its wholly owned subsidiaries, ensuring their continued operations, as required. Allowance for expected credit losses Management has determined that there is no expected credit loss amount that was required to be taken up during the financial year (2025: Nil). The ageing of the receivables held by the Group are as follows: 2026 2025 $ $ Not overdue 3,026,228 4,020,559 0 to 3 months overdue 180,392 88,820 3,206,620 4,109,379 Historically, the Group has not recognised any bad or doubtful debts in relation to receivables from contracts with customers. Therefore, expected credit loss at balance date is minimal. Liquidity risk Vigilant liquidity risk management requires the Group to maintain sufficient liquid assets (mainly cash and cash equivalents) to be able to pay debts as and when they become due and payable. The Group manages liquidity risk by maintaining adequate cash reserves by continuously monitoring actual and forecast cash flows.
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78 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 30. Financial risk management objectives and policies (continued) 49 Remaining contractual maturities The following tables detail the Group's remaining contractual maturity for its financial instrument liabilities. The tables h ave been drawn up based on the earliest date on which the financial liabilities are required to be paid. Carrying Value 1 year or less Between 1 and 2 years Between 2 and 5 years Over 5 years Remaining contractual maturities 2026 $ $ $ $ $ $ Non-derivatives Non-interest bearing Trade and other payables 4,693,401 4,693,401 - - - 4,693,401 Interest-bearing - fixed rate Borrowings 2,741,360 2,644,086 232,797 155,198 - 3,032,081 Lease liability 1,363,221 905,047 489,902 19,820 - 1,414,769 Total non-derivatives 8,797,982 8,242,534 722,699 175,018 - 9,140,251 Derivatives Options issued 28,864 28,864 - - - 28,864 Total derivatives 28,864 28,864 - - - 28,864 Carrying Value 1 year or less Between 1 and 2 years Between 2 and 5 years Over 5 years Remaining contractual maturities 2025 $ $ $ $ $ $ Non-derivatives Non-interest bearing Trade and other payables 5,520,863 5,520,863 - - - 5,520,863 Interest-bearing - fixed rate Borrowings 1,215,184 746,496 468,688 - - 1,215,184 Lease liability 2,014,464 982,428 635,082 396,955 - 2,014,465 Total non-derivatives 8,750,511 7,249,787 1,103,770 396,955 - 8,750,512 The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed above. Fair value of financial instruments Unless otherwise stated, the carrying amounts of the Group's financial assets and financial liabilities measured at amortised cost approximate their fair value, owing to their short-term nature. The only financial instrument measured at fair value on a recurring basis is the derivative financial liability arising from the options issued to Sonic Healthcare Limited (refer note 23). Under AASB 13, this is categorised as a Level 3 measurement in the fair value hierarchy, as its valuation relies on significant unobservable inputs. There were no transfers between levels during the year. The derivative is valued using a Monte Carlo option -pricing model. The key inputs are the Company's share price at the reporting date, the exercise price, expected volatility of 75%, the risk-free rate and the time to expiry. Expected volatility is the significant unobservable input. As there is no traded options market in the Company's shares from which an implied volatility can be observed, expected volatility has been estimated by reference to the Company's historical share price volatility, which requires judgement in the selection of the observation period and its use as a proxy for future volatility. Accordingly, the instrument is classified as Level 3. Movements in the derivative financial liability during the year were:
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79 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 30. Financial risk management objectives and policies (continued) 50 2026 2025 $ $ Opening Balance - - Recognised on grant of options (initial fair value) 385,808 - Fair Value gain recognised in profit or loss (356,944) - Closing Balance 28,864 - Given the size of the liability, a reasonably possible change in expected volatility would not have a material effect on profit or loss. Note 31. Reconciliation of loss after income tax to net cash used in operating activities 2026 2025 $ $ Loss after income tax (expense)/benefit for the year (20,721,356) (14,939,471) Adjustments for: Depreciation and amortisation (non-cash) 4,411,401 4,431,174 Share-based payments (non-cash) 774,932 814,294 Loss on disposal of property, plant & equipment (non-cash) 97,280 1,843 (Unwinding)/Net capitalisation of capital portion of grants and subsidies received (non-cash) 1,027,374 557,164 Foreign currency loss/(gain) (non-cash) 1,503,571 (1,759,767) Net gain on derecognition of contingent consideration payable (non-cash) - (4,469,548) Impairment (non-cash) 745,485 - Gain on derecognition of lease liabilities (non-cash) (44,499) - Gain on derivative liability at FV (non-cash) (356,944) - Interest capitalised into borrowing (non-cash) 85,406 - 8,244,006 (424,840) Decrease in trade and other receivables 776,871 3,993,344 (Increase) in inventories (277,546) (264,829) Decrease in prepayments 557,083 305,709 (Decrease) in trade and other payables (688,915) (246,324) Increase/(decrease) in employee benefits (168,779) 166,487 Increase/(decrease) in contract liabilities 54,125 (353,561) Increase in income tax payable 20,833 7,585 Increase in deferred taxes (167,057) (256,611) 106,615 3,351,800 (12,370,735) (12,012,511) Note 32. Non-cash investing and financing activities 2026 2025 $ $ Additions to the right-of-use assets / lease liabilities 567,812 1,811,027
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80 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 51 Note 33. Changes in liabilities arising from financing activities Insurance Premium Funding Equipment Loan Lease Liability R&D Funding Total $ $ $ $ $ Balance at 1 July 2024 395,387 - 1,183,218 - 1,578,605 Net cash used in financing activities (499,261) (491,900) (969,717) - (1,960,878) Loans received 409,060 1,298,209 - - 1,707,269 Acquisition of plant and equipment by means of leases - - 1,811,027 - 1,811,027 Interest expense 12,972 90,717 72,778 - 176,467 Exchange differences - - 56,134 - 56,134 Disposals of lease liabilities - - (138,976) - (138,976) Balance at 30 June 2025 318,158 897,026 2,014,464 - 3,229,648 Net cash used in financing activities (326,335) (407,981) (941,527) - (1,675,843) Loans received/refinanced - 12,752 - 2,045,659 2,058,411 Acquisition of plant and equipment by means of leases - - 567,812 - 567,812 Interest expense 8,177 60,897 79,975 85,406 234,455 Exchange differences - - (61,916) - (61,916) Disposals of lease liabilities - - (295,587) - (295,587) Balance at 30 June 2026 - 562,694 1,363,221 2,131,065 4,056,980 Note 34. Key management personnel disclosures Key management personnel include the Chief Executive Officer, Chief Financial Officer and the Directors of the Group, who have the authority and responsibility for planning, directing and controlling the activities of the Group. Compensation The aggregate compensation made to Directors and other members of key management personnel of the Group is set out below: 2026 2025 $ $ Short-term employee benefits 1,050,362 1,200,313 Post-employment benefits 63,600 57,750 Long-term benefits 6,514 22,032 Share-based payments 328,852 317,755 1,449,328 1,597,850 Additional detail relating the compensation of key management personnel and Directors is included in the accompanying Directors' Report. Note 35. Related party transactions Parent entity Microba Life Sciences Limited is the parent entity. Subsidiaries Interests in subsidiaries are set out in note 40.
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81 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 35. Related party transactions (continued) 52 Key management personnel Disclosures relating to key management personnel are set out in note 34 and the remuneration report included in the Directors' report. Transactions with related parties Other than KMP remuneration note 34 and Directors' participation in the 13 August 2025 capital raising on the same terms as other participants, there were no related party transactions. Receivable from and payable to related parties There were no trade receivables from or trade payables to related parties at the current and previous reporting date. Loans to/from related parties There were no loans to or from related parties at the current and previous reporting date. Note 36. Remuneration of auditors During the financial year the following fees were paid or payable for services provided by Pitcher Partners, the auditor of t he Group, and its network firms: 2026 2025 $ $ Audit services - Pitcher Partners Audit or review of the financial statements 187,824 123,000 Other services - Pitcher Partners Taxation services 98,950 50,090 Other fees 2,790 938 101,740 51,028 289,564 174,028 Other services - network firms Taxation services 27,363 48,849 Audit Fees 69,668 94,617 97,031 143,466 97,031 143,466 Note 37. Earnings per share 2026 2025 $ $ Loss after income tax attributable to the owners of Microba Life Sciences Limited (20,721,356) (14,939,471) Number Number Weighted average number of ordinary shares used in calculating basic earnings per share 600,642,678 448,404,123 Weighted average number of ordinary shares used in calculating diluted earnings per share 600,642,678 448,404,123
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82 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 37. Earnings per share (continued) 53 Cents Cents Basic earnings per share (3.45) (3.33) Diluted earnings per share (3.45) (3.33) Due to the loss making position of the Group, the impact of options issued is non -dilutive and as such, has been excluded from the calculation of earnings per share. Note 38. Operating segments Identification of reportable operating segments The Group is organised into two (2) operating segments: Testing Services and Supplements, and Research & Development. These operating segments are based on the internal reports that are reviewed and used by the Board of Directors (who are identified as the Chief Operating Decision Maker ('CODM') in assessing performance and in determining the allocation of resources. There is no aggregation of operating segments. The CODM reviews the profit and loss before tax of the consolidated Group on a monthly basis. The accounting policies adopted for internal reporting to the CODM are consistent with those adopted in the financial statements. Major customers During the year ended 30 June 2026 there were no significant customers from which 10% or more of the Group's external revenue was derived, which is similar to the year ended 30 June 2025.
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83 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 38. Operating segments (continued) 54 Operating segment information Segment profit and loss Testing Services Research & & Supplements Development Unallocated Total 2026 $ $ $ $ Revenue from contracts with external customers 14,717,668 40,793 - 14,758,461 Cost of sales (7,702,762) (29,527) - (7,732,289) Gross profit 7,014,906 11,266 - 7,026,172 Subsidies and grant income - 1,105,398 - 1,105,398 Interest income - - 315,606 315,606 Other income - - 85,593 85,593 Net gain on lease revaluation 44,499 - - 44,499 Fair value gain on derivative - - 356,944 356,944 44,499 1,105,398 758,143 1,908,040 Expenses Employee benefits and other related costs (3,406,325) (1,769,357) (9,178,391) (14,354,073) Research and development expense - (417,065) - (417,065) Depreciation and amortisation expense (2,788,320) (139,995) (1,483,086) (4,411,401) Consulting fees (385,606) 8,616 (1,463,816) (1,840,806) Marketing and advertising expense (808,048) (350) (374,314) (1,182,712) Travel Expenses (160,383) (1,051) (149,572) (311,006) Legal and intellectual property advisory fees (59,145) 31,508 (174,568) (202,205) Finance costs (16,151) - (222,406) (238,557) Subscriptions and information technology expenses (118,296) (7,753) (1,522,984) (1,649,033) Impairment (745,485) - - (745,485) Foreign currency gain/(loss) (9,065) 1,310 (1,498,180) (1,505,935) Net gain/(loss) on disposal of asset 73,882 (135,546) (35,616) (97,280) Other expenses (1,614,064) (1,565) (1,346,993) (2,962,622) Total expenses (10,037,006) (2,431,248) (17,449,926) (29,918,180) Loss before income tax benefit (2,977,601) (1,314,584) (16,691,783) (20,983,968) Income tax benefit - - 262,612 262,612 Loss after income tax (2,977,601) (1,314,584) (16,429,171) (20,721,356)
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84 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 38. Operating segments (continued) 55 Testing Services Research & & Supplements Development Unallocated Total 2025 $ $ $ $ Revenue from contracts with external customers 15,669,089 - - 15,669,089 Cost of sales (8,227,712) - - (8,227,712) Gross profit 7,441,377 - - 7,441,377 Subsidies and grant income 24,600 2,806,277 - 2,830,877 Interest income - - 583,355 583,355 Other income - - 95,658 95,658 Foreign currency gain - - 1,759,767 1,759,767 Net gain on derecognition of contingent consideration - - 4,469,548 4,469,548 24,600 2,806,277 6,908,328 9,739,205 Expenses Employee benefits and other related costs (4,930,886) (1,271,889) (10,282,789) (16,485,564) Research and development expense - (2,008,294) - (2,008,294) Depreciation and amortisation expense (2,827,775) (159,511) (1,443,887) (4,431,173) Travel Expenses (141,207) (6,434) (318,173) (465,814) Consulting fees (129,719) (268,392) (3,024,458) (3,422,569) Marketing and advertising expense (602,876) - (59,417) (662,293) Legal and intellectual property advisory fees - (54,085) (146,151) (200,236) Finance costs (24,780) - (151,906) (176,686) Subscriptions and information technology expenses (254,920) (37,206) (987,376) (1,279,502) Other expenses (1,761,715) (56,337) (1,276,464) (3,094,516) Total expenses (10,673,878) (3,862,148) (17,690,621) (32,226,647) Loss before income tax (3,207,901) (1,055,871) (10,782,293) (15,046,065) Income tax benefit - - 106,594 106,594 Loss after income tax expense (3,207,901) (1,055,871) (10,675,699) (14,939,471) Segment assets and liabilities Testing Services Research & & Supplements Development Unallocated Total $ $ $ $ 2026 Total assets 27,715,328 2,693,414 9,400,292 39,809,034 Total liabilities 7,210,205 2,306,635 5,911,194 15,428,034 Additions to non-current assets 4,081,173 42,893 170,338 4,294,405 Testing Services Research & & Supplements Development Unallocated Total $ $ $ $ 2025 Total assets 29,370,165 3,696,697 14,370,264 47,437,126 Total liabilities 5,215,642 1,877,593 7,850,404 14,943,639 Additions to non-current assets 2,962,734 1,464,368 283,295 4,710,397
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85 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 38. Operating segments (continued) 56 Geographical information Revenue from external customers Non-current assets 2026 2025 2026 2025 $ $ $ $ Australia 7,039,430 5,407,700 9,767,072 8,709,695 Europe 809,094 1,374,082 - - New Zealand 40,576 6,933 - - United Arab Emirates 109,966 97,520 - - United Kingdom 6,090,433 7,541,566 16,155,020 19,607,514 United States 550,828 942,521 - 257,226 Asia 7,019 13,744 - - Ireland 111,115 285,023 - - 14,758,461 15,669,089 25,922,092 28,574,435 Note 39. Parent entity information Set out below is the supplementary information about the parent entity. Statement of profit or loss and other comprehensive income Parent 2026 2025 $ $ Loss after income tax (17,188,807) (17,923,706) Other comprehensive income for the year, net of tax - - Total comprehensive loss (17,188,807) (17,923,706)
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86 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 39. Parent entity information (continued) 57 Statement of financial position Parent 2026 2025 $ $ Total current assets 29,555,601 31,458,706 Total non-current assets - - Total assets 29,555,601 31,458,706 Total current liabilities 3,080,068 1,132,733 Total non-current liabilities 2,094,533 1,451,867 Total liabilities 5,174,601 2,584,600 Net assets 24,381,000 28,874,106 Equity Issued capital 120,463,739 108,542,970 Share-based payments reserve 3,707,886 2,932,954 Accumulated losses (99,790,625) (82,601,818) Total equity 24,381,000 28,874,106 Guarantees entered into by the parent entity in relation to the debts of its subsidiaries The parent entity had no guarantees in relation to the debts of its subsidiaries as at 30 June 2026 and 30 June 2025. Contingent liabilities The parent entity had no contingent liabilities as at 30 June 2026 and 30 June 2025. Capital commitments - Property, plant and equipment The parent entity had no capital commitments for property, plant and equipment as at 30 June 2026 and 30 June 2025. Loans to subsidiaries The parent entity holds loans with its subsidiaries which cause the net assets of the parent entity to exceed the total equity of the Group. Impairment losses have been recorded against the parent entity's loans receivable to reduce the equity position of the parent entity to the consolidated equity of the Group. Material accounting policy information The accounting policies of the parent entity are consistent with those of the Group, as disclosed in note 2.
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87 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 58 Note 40. Interests in subsidiaries The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the accounting policy described in note 2: Ownership interest Principal place of business / 2026 2025 Name Country of incorporation % % Microba Pty Ltd Incorporated 6 September 2019 Australia 100% 100% Microba Services Pty Ltd Incorporated 6 September 2019 Australia 100% 100% Microba IP Pty Ltd Incorporated 6 September 2019 Australia 100% 100% Microba US, Inc. Incorporated 14 January 2020 United States of America 100% 100% Microba UK Holdings Limited Incorporated 16 October 2023 United Kingdom 100% 100% Invivo Clinical Limited Incorporated 27 March 2007 United Kingdom 100% 100% Invivo Healthcare Limited Incorporated 20 May 2019 United Kingdom 100% 100% Bioteric Therapeutics Inc Incorporated 14 November 2024 United States of America 100% 100% Note 41. Contingent liabilities There were no contingent liabilities requiring disclosure in the financial report. Note 42. Events after the reporting period Capital Raise On 24 July 2026, an Extraordinary General Meeting (EGM) was held where shareholders approved the issuance of equity securities and attaching options related to the first and second tranche (Tranche 2) of the Placement and the Share Purchase Plan (SPP), as announced to the ASX on 12 June 2026. Following the EGM approval, the Company completed the following equity issuances: Tranche 2 Placement: On 29 July 2026, the Company completed the issuance of the Tranche 2 Placement, resulting in the issue of 8,659,785 new fully paid ordinary shares at $0.05 per share, raising approximately $0.4 million (before costs). Share Purchase Plan (SPP): On 29 July 2026, the Company completed the issuance of the SPP, where it raised an additional $0.4 million through the issue of 8,150,000 new fully paid ordinary shares at $0.05 per share. The SPP participants also received one unlisted attaching option for every new share subscribed, resulting in the issuance of 8,150,000 attaching options exercisable at $0.0625 within three years from the date of issue. Options: On 29 July 2026, 100,004,240 options were issued at an exercise price of $0.0625 for Tranche 1 and Tranche 2 participants who received one unlisted attaching option for every new share subscribed, expiring within three years from the date of issue. As a result of these transactions, the Group's cash position has been significantly strengthened, providing additional working capital to accelerate product development, clinical adoption, and commercial growth initiatives as outlined in the capital raising announcement. Potential merger with Genetic Signatures Limited On 26 August 2026, the Company announced that it is in preliminary, non-binding discussions with Genetic Signatures Limited (ASX: GSS) regarding a potential merger of the two businesses. The discussions are at an early stage and remain incomplete. No binding agreement has been entered into, no firm decision to proceed has been made by either party, and there is no certainty that any transaction will proceed or as to its terms. Any transaction would be subject to further due diligence and all required regulatory and other approvals. As the discussions are preliminary and incomplete, any financial effect cannot be reliably estimated and no adjustment has been made to these financial statements.
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88 FINANCIAL STATEMENTS Microba Life Sciences Limited Notes to the consolidated financial statements 30 June 2026 Note 42. Events after the reporting period (continued) 59 No other matter or circumstance has arisen since 30 June 2026 that has significantly affected, or may significantly affect th e Group's operations, the results of those operations, or the Group's state of affairs in future financial years.
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89 FINANCIAL STATEMENTS Microba Life Sciences Limited Consolidated entity disclosure statement As at 30 June 2026 60 Microba Life Sciences Limited is required by Australian Accounting Standards to prepare consolidated financial statements in relation to the company and its controlled entities (the consolidated entity). In accordance with subsection 295(3A) of the Corporations Act 2001, this consolidated entity disclosure statement provides information about each entity that was part of the consolidated entity at the end of the financial year. Place formed / Ownership interest Entity name Entity type Country of incorporation % Tax residency Microba Life Sciences Limited Body Corporate Australia - Australia Microba Pty Ltd Body Corporate Australia 100.00% Australia Microba Services Pty Ltd Body Corporate Australia 100.00% Australia Microba IP Pty Ltd Body Corporate Australia 100.00% Australia Microba US Inc Body Corporate United States of America 100.00% United States of America Microba UK Holdings Limited Body Corporate United Kingdom 100.00% United Kingdom Invivo Clinical Limited Body Corporate United Kingdom 100.00% United Kingdom Invivo Healthcare Limited Body Corporate United Kingdom 100.00% United Kingdom Bioteric Therapeutics Inc Body Corporate United States of America 100.00% United States of America At the end of the financial year, no entity within the consolidated entity was a trustee of a trust within the consolidated e ntity, a partner in a partnership within the consolidated entity, or a participant in a joint venture within the consolidated entity.
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90 FINANCIAL STATEMENTS Microba Life Sciences Limited Directors' declaration 30 June 2026 61 The Directors of the Company declare that: ● the attached financial statements and notes comply with the Corporations Act 2001, the Australian Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements; ● the attached financial statements and notes comply with IFRS Accounting Standards as issued by the International Accounting Standards Board as described in note 2 to the financial statements; ● the attached financial statements and notes give a true and fair view of the Group's financial position as at 30 June 2026 and of its performance for the financial year ended on that date; ● there are reasonable grounds to believe that the Group will be able to pay its debts as and when they become due and payable; and ● the consolidated entity disclosure statement required by subsection 295(3A) of the Corporations Act 2001 is true and correct. The D irectors have been given the declarations required by section 295A of the Corporations Act 2001. Signed in accordance with a resolution of Directors made pursuant to section 295(5)(a) of the Corporations Act 2001. On behalf of the Directors ___________________________ Pasquale Rombola Director 31 August 2026 Brisbane
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91 FINANCIAL STATEMENTS Level 38, 345 Queen Street Brisbane, QLD 4000 Postal address GPO Box 1144 Brisbane, QLD 4001 +61 7 3222 8444 pitcher.com.au Nigel Fischer Mark Nicholson Peter Camenzuli Jason Evans Kylie Lamprecht Norman Thurecht Brett Headrick Warwick Face Cole Wilkinson Simon Chun Jeremy Jones Tom Splatt James Field Daniel Colwell Robyn Cooper Felicity Crimston Cheryl Mason Kieran Wallis Murray Graham Andrew Robin Karen Levine Edward Fletcher Robert Hughes Tracey Norris Anthony Kazamias Sean Troyahn Adele Smith Alex Pollock Pitcher Partners is an association of independent firms. An Independent Queensland Partnership ABN 84 797 724 539. Liability limited by a scheme approved under Professional Standards Legislation. Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities. Adelaide | Brisbane | Melbourne | Newcastle | Perth | Sydney Independent Auditor’s Report to the Members of Microba Life Sciences Limited Report on the Audit of the Financial Report Opinion We have audited the financial report of Microba Life Sciences Limited (“the Company”) and its controlled entities (“the Group”), which comprises the consolidated statement of financial position as at 30 June 2026, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial statements including material accounting policy information, the consolidated entity disc losure statement and the directors’ declaration. In our opinion, the accompanying financial report of Microba Life Sciences Limited is in accordance with the Corporations Act 2001, including: (a) giving a true and fair view of the Group’s financial position as at 30 June 2026 and of its financial performance for the year then ended; and (b) complying with Australian Accounting Standards and the Corporations Regulations 2001. Basis for Opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of APES 110 Code of Ethics for Professional Accountants (including Independence Standards) issued by the Accounting Professional and Ethical Standards Board (“the Code”) that are relevant to audits of the financial report of public interest entities in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. We confirm that the independence declaration required by the Corporations Act 2001, which has been given to the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor’s report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Material Uncertainty Related to Going Concern We draw attention to note 2 in the financial report, which describes events and/or conditions which indicate that a material uncertainty exists that may cast significant doubt on the Group’s ability to continue as a going concern. Our opinion is not modified in respect to this matter.
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92 ASX ADDITIONAL INFORMATION 2 Pitcher Partners is an association of independent firms. An Independent Queensland Partnership ABN 84 797 724 539. Liability limited by a scheme approved under Professional Standards Legislation. Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities. Key Audit Matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Key Audit Matter How our audit addressed the key audit matter Impairment of goodwill Refer to note 19 The consolidated statement of financial position as at 30 June 2026 includes goodwill valued at $9,198,124 which relates to the acquisition of Invivo Clinical Limited. The carrying amount of goodwill is supported by management’s value-in-use calculation which is based on board approved budgeted future cash flows and key estimates such as the annual growth rates, discount rate and terminal value growth rate. This is a key audit matter as the value of goodwill is material, and the evaluation of the recoverable amount requires significant judgement in determining the key estimates to support the value- in-use calculations. Our procedures included: Understanding and evaluating the design and implementation of management’s processes and controls over the impairment assessment of goodwill; Assessing management’s determination of the Group’s cash generating units (‘CGUs’) based on our understanding of the nature of the Group’s business and the identifiable groups of cash generating assets; Comparing the cashflow forecasts used in the value-in-use calculations to Board approved budgets and the Group’s historical performance; Assessing the significant judgements and key estimates used for the impairment assessment, in particular, the annual growth rates, discount rate and terminal value growth rate; Checking the mathematical accuracy of the impairment model and agreeing relevant data to supporting documentation; Performing a sensitivity analysis of management’s value-in-use calculation; and Assessing the adequacy of the Group’s disclosures. Research and Development Tax Incentive Refer to notes 5 and 13 At 30 June 2026 the Group’s consolidated statement of financial position includes a Research and Development (R&D) Tax Incentive receivable of $2,135,829 and R&D Tax Incentive income of $1,105,398. The Group receives refundable R&D tax incentives from the Australian government which represents 43.5 cents in each dollar of eligible annual R&D Our procedures included: Obtaining an understanding of, and evaluating the design and implementation of the controls associated with management’s assessment of eligible R&D expenditure under the tax incentive scheme; Engaging our internal R&D tax incentive expert to:
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93 ASX ADDITIONAL INFORMATION 3 Pitcher Partners is an association of independent firms. An Independent Queensland Partnership ABN 84 797 724 539. Liability limited by a scheme approved under Professional Standards Legislation. Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities. expenditure, if its turnover is less than $20 million per annum. The Group has had multiple Overseas Advanced Findings successfully approved by AusIndustry relating to its immuno-oncology and IBD therapeutic programs. Management performed a detailed assessment of the Group’s total R&D expenditure to estimate the refundable R&D tax incentive receivable under the R&D tax incentive legislation. This was considered a key audit matter due to the size of the receivable and income recognised as well as the degree of judgement and interpretation of the R&D tax legislation required to assess the eligibility of the R&D expenditure under the scheme. o Review the expenditure methodology adopted by management for consistency with the R&D tax legislation; and o Consider the nature of the expenses against the eligibility criteria of the R&D tax incentive scheme and form a view about whether the expenses included in the estimate were likely to meet the eligibility criteria; Testing a sample of expenditure upon which the claim is based, to underlying documentation, such as invoices and payroll records; Inspecting copies of relevant correspondence with AusIndustry and the ATO related to current and historical claims; and Assessing the appropriateness of the accounting entries, classification of the R&D tax incentive and financial statement disclosures, based on Australian Accounting Standards. Other Information The directors are responsible for the other information. The other information comprises the information included in the Group’s annual report for the year ended 30 June 2026, but does not include the financial report and our auditor’s report thereon. Our opinion on the financial report does not cover the other information and accordingly we do not express any form of assurance conclusion thereon. In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Responsibilities of the Directors for the Financial Report The directors of the Company are responsible for the preparation of: (a) the financial report (other than the consolidated entity disclosure statement) that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001; and (b) the consolidated entity disclosure statement that is true and correct in accordance with the Corporations Act 2001; and (c) for such internal control as the directors determine is necessary to enable the preparation of: (i) the financial report (other than the consolidated entity disclosure statement) that gives a true and fair view and is free from material misstatement, whether due to fraud or error; and
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94 ASX ADDITIONAL INFORMATION 4 Pitcher Partners is an association of independent firms. An Independent Queensland Partnership ABN 84 797 724 539. Liability limited by a scheme approved under Professional Standards Legislation. Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities. (ii) the consolidated entity disclosure statement that is true and correct and is free of misstatement, whether due to fraud or error. In preparing the financial report, the directors are responsible for assessing the ability of the Group to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so. Auditor’s Responsibilities for the Audit of the Financial Report Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the a ggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement and maintain professional scepticism throughout the audit. We also: Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern. Evaluate the overall presentation, structure and content of the financial report, including the disclosures, and whether the financial report represents the underlying transactions and events in a manner that achieves fair presentation. Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the financial report. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion. We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
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95 ASX ADDITIONAL INFORMATION 5 Pitcher Partners is an association of independent firms. An Independent Queensland Partnership ABN 84 797 724 539. Liability limited by a scheme approved under Professional Standards Legislation. Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities. We also provide the directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied. From the matters communicated with the directors, we determine those matters that were of most significance in the audit of the financial report of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. Report on the Remuneration Report Opinion on the Remuneration Report We have audited the Remuneration Report included in 9-15 of the directors’ report for the year ended 30 June 2026. In our opinion, the Remuneration Report of Microba Life Sciences Limited, for the year ended 30 June 2026, complies with section 300A of the Corporations Act 2001. Responsibilities The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. PITCHER PARTNERS DANIEL COLWELL Partner Brisbane, Queensland 31 August 2026
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96 Microba.comMicroba.com Microba.com MICROBA LIFE SCIENCES LIMITED | ANNUAL REPORT 2026 05 ASX Additional Information
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97 ASX ADDITIONAL INFORMATION Microba Life Sciences Limited Shareholder information 30 June 2026 64 The shareholder information set out below was applicable as at 5 August 2026, unless otherwise stated. Distribution of equitable securities Analysis of number of equitable security holders by size of holding: Ordinary shares % of total Number shares of holders issued 1 to 1,000 30 - 1,001 to 5,000 314 0.13 5,001 to 10,000 201 0.21 10,001 to 100,000 596 3.29 100,001 and over 390 96.37 1,531 100.00 Holding less than a marketable parcel 554 0.36 Equity security holders Twenty largest quoted equity security holders The names of the twenty largest security holders of quoted equity securities are listed below: Ordinary shares % of total shares Number held issued ACN 002 889 545 PTY LTD 162,033,168 23.14 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED 80,694,921 11.52 UBS NOMINEES PTY LTD 48,982,574 6.99 CITICORP NOMINEES PTY LIMITED 47,960,727 6.85 SA MICROBA HOLDINGS PTY LTD 30,961,049 4.42 BOYSENHOLTZ PTY LTD 17,178,431 2.45 GENIE MICROBIOME PTY LTD 15,920,000 2.27 MR DON MAREE 11,545,742 1.65 GINKGO BIOWORKS INC 10,886,385 1.55 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2 9,167,681 1.31 BELGRAVIA STRATEGIC EQUITIES PTY LTD 8,432,342 1.20 G & N LORD SUPERANNUATION PTY LTD 8,000,000 1.14 ROMBOLA FAMILY PTY LTD 7,200,000 1.03 TAG FAMILY INVESTMENTS PTY LIMITED 6,000,000 0.86 SEALEX PTY LTD 5,100,000 0.73 HAWKSBURN CAPITAL PTE LTD 4,717,793 0.67 MISS PENELOPE PRINGLE ROBERTSON 4,433,334 0.63 RPMT INVESTMENTS PTY LTD 4,425,000 0.63 ADAZ NOMINEES PTY LTD 4,300,000 0.61 MR ROBERT JOHN WITTENOOM 4,000,000 0.57 491,939,147 70.22
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98 ASX ADDITIONAL INFORMATION Microba Life Sciences Limited Shareholder information 30 June 2026 65 Unquoted equity securities Number Number on issue of holders Unlisted options exercisable at $0.09 46,296,296 1 Unlisted options exercisable at $0.075 8,089,672 3 Unlisted options exercisable at $0.0625 108,154,240 117 Unlisted options exercisable at $0.14 80,555,423 290 Options issued under the Employee Share and Option Plan (ESOP) 23,783,075 25 Total 266,878,706 372 The following entity holds 20% or more of unquoted equity securities: Name Class Number held ACN 002 889 545 PTY LTD $0.09 options 46,296,296 Berne No 132 Pty Ltd $0.075 options 3,544,836 CG Nominees $0.075 options 3,544,836 ACN 002 889 545 PTY LTD $0.0625 options 30,000,000 ACN 002 889 545 PTY LTD $0.14 options 23,148,148 Substantial holders Substantial holders in the Company are set out below: Ordinary shares % of total shares Number held issued Sonic Healthcare Limited 132,033,168 21.68 Perennial Value Management 95,416,701 13.62 Mercer Investments (Australia) Limited 53,123,105 7.59 Substantial holdings are based on the last notice for each holder lodged on the Australian Securities Exchange (ASX). Voting rights The voting rights attached to ordinary shares are set out below: Ordinary shares On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote. There are no other classes of equity securities. Restricted securities There are no restricted securities or securities subject to voluntary escrow on issue. Share buy-back There is currently no on-market share buy-back. Use of funds Since admission, the Company used its cash consistent with its business objectives.
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1300 974 621 HELLO@MICROBA.COM MICROBA LIFE SCIENCES LIMITED ABN 82 617 096 652 At Microba, expect better. Because we do. We develop world-leading microbiome research and technology. We deliver tests that go deeper and broader. We craft insights that improve people’s lives. Why? Because better is possible. Because better means more freedom and confidence. And, most importantly, because more freedom and confidence means better, happier lives. We are an ecos ystem of people organised around one simple principle – making you better. Because better care doesn’t just transform individual lives, it builds healthier, happier communities. View this announcement on Microba's Investor Hub: https://ir.microba.com/link/PR1MBr