Exhibit 99.1
THE ROYALAND COMPANY LTD.
TABLE OF CONTENTS
THE ROYALAND COMPANY LTD.
INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS
(in US Dollars)
| December 31, 2024 (Unaudited) | June 30, 2024 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash | $ | $ | ||||||
| Deferred offering costs | ||||||||
| Prepaid expenses | ||||||||
| Total current assets | ||||||||
| Total Assets | $ | $ | ||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT) | ||||||||
| Shareholders’ Deficit: | ||||||||
| Preference shares, par value $ | $ | $ | ||||||
| Common shares – Class A, par value $ | ||||||||
| Common shares – Class B, par value $ | ||||||||
| Additional paid-in capital | ||||||||
| Subscription receivable | ( | ) | ( | ) | ||||
| Other comprehensive loss | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total Shareholders’ Equity (Deficit) | ( | ) | ( | ) | ||||
| Current liabilities: | ||||||||
| Accounts payable and accrued liabilities: | ||||||||
| Legal and accounting | ||||||||
| Product development expense | ||||||||
| Consulting | ||||||||
| Other | ||||||||
| Other current liabilities | ||||||||
| Due to related parties | ||||||||
| Total current liabilities | ||||||||
| Total Liabilities | ||||||||
| Total Liabilities and Shareholders’ Equity (Deficit) | $ | $ | ||||||
See accompanying Notes to the Interim Condensed Consolidated Financial Statements
2
THE ROYALAND COMPANY LTD.
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in US Dollars)
(Unaudited)
| For the Period July 1, 2024 to December 31, 2024 | For the Period July 1, 2023 to December 31, 2023 | |||||||
| Net revenues | $ | $ | ||||||
| Operating expenses: | ||||||||
| Product research and development | ||||||||
| Legal and accounting | ||||||||
| Consulting | ||||||||
| Filing fees | ||||||||
| Bad debts | ||||||||
| Other | ||||||||
| Total operating expenses | ||||||||
| Operating loss | ( | ) | ( | ) | ||||
| Loss before provision for income taxes | ( | ) | ( | ) | ||||
| Provision (benefit) for income taxes | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Other Comprehensive Income (Loss): | ||||||||
| Currency Translation Adjustment | ( | ) | ||||||
| Comprehensive loss | $ | ( | ) | $ | ( | ) | ||
| Weighted average shares outstanding: | ||||||||
| Capital shares – basic and diluted | ||||||||
| Common shares – basic and diluted | ||||||||
| Weighted average net loss per share: | ||||||||
| Per Common share – basic and diluted | $ | ( | ) | $ | ( | ) | ||
See accompanying Notes to the Interim Condensed Consolidated Financial Statements
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THE ROYALAND COMPANY LTD.
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (DEFICIT)
(in US Dollars)
| Preference Shares | Common
Shares Class A | Common
Shares Class B | Common
Shares Class B To Be Issued | Additional Paid-In | Subscription | Other Comprehensive | Accumulated | Total
Shareholders’ | ||||||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Capital | Receivable | Loss | Deficit | Equity | ||||||||||||||||||||||||||||||||||||||||
| Balance – June 30, 2024 | $ | $ | $ | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||||||||||||||||||||
| Currency translation adjustment | – | – | – | – | ||||||||||||||||||||||||||||||||||||||||||||||||
| Stock option expense | – | – | – | – | ||||||||||||||||||||||||||||||||||||||||||||||||
| Net loss | – | – | – | – | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||
| Balance – December 31, 2024 | $ | $ | $ | – | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||||||||||||||||
| Preference Shares |
Common
Shares Class A |
Common
Shares Class B |
Common
Shares Class B To Be Issued |
Additional
Paid-In |
Subscription | Other Comprehensive |
Accumulated | Total
Shareholders’ |
||||||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Capital | Receivable | Loss | Deficit | Equity | ||||||||||||||||||||||||||||||||||||||||
| Balance – June 30, 2023 | $ | $ | $ | $ | $ | $ | ( |
) | $ | ( |
) | $ | ( |
) | $ | |||||||||||||||||||||||||||||||||||||
| Gross proceeds from sale of shares | – | – | ( |
) | ( |
) | ||||||||||||||||||||||||||||||||||||||||||||||
| Cost of shares issued | – | – | – | ( |
) | ( |
) | |||||||||||||||||||||||||||||||||||||||||||||
| Currency translation adjustment | – | ( |
) | ( |
) | |||||||||||||||||||||||||||||||||||||||||||||||
| Net loss | – | – | – | ( |
) | ( |
) | |||||||||||||||||||||||||||||||||||||||||||||
| Balance – December 31, 2023 | $ | $ | $ | $ | $ | $ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | |||||||||||||||||||||||||||||||||||
See accompanying Notes to the Interim Condensed Consolidated Financial Statements
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THE ROYALAND COMPANY LTD.
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in US Dollars)
(Unaudited)
| For the Period July 1, 2024 to December 31, 2024 | For the Period July 1, 2023 to December 31, 2023 | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustment to reconcile net loss to net cash used in operating activities: | ||||||||
| Share option expense | ||||||||
| Changes in operating assets/liabilities: | ||||||||
| Other accounts receivable | ( | ) | ||||||
| Prepaid expenses | ||||||||
| Accounts payable and accrued liabilities | ||||||||
| Due to related parties | ||||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Cash flows from financing activities: | ||||||||
| Gross proceeds from sale of common shares | ||||||||
| Cost of common share issuances | ( | ) | ||||||
| Deferred offering costs | ( | ) | ||||||
| Repayments to related parties | ( | ) | ||||||
| Net cash provided by financing activities | ||||||||
| Net change in cash | ( | ) | ||||||
| Currency translation adjustment | ( | ) | ||||||
| Cash, beginning of period | ||||||||
| Cash, end of period | $ | $ | ||||||
| Supplemental disclosures of cash flow information: | ||||||||
| Cash paid during the period for: | ||||||||
| Interest | $ | $ | ||||||
| Taxes | $ | $ | ||||||
See accompanying Notes to the Interim Condensed Consolidated Financial Statements
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THE ROYALAND COMPANY LTD.
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 1. | Organization and Business |
Organization and Business
The RoyaLand Company Ltd.
(“RoyaLand Ltd”, “we” and “Successor”), an exempted company limited by shares, was incorporated on
On November 28, 2022, we entered into a share exchange agreement (the”SEA”) with RoyaLand Company (“RoyaLand Company”), a United States company incorporated in the state of Nevada. At the time of the SEA, the majority of our shares were owned by our CEO and, as a result, we determined this to be a common control acquisition.
On November 29, 2022, we acquired
RoyaLand Ltd is a company focused on creating an online and offline immersive, fantasy-based royalty-themed experience called myRoyal.World, primarily centered around the mobile-first massively multiplayer online role-playing game, or MMORPG, called TheRoyal.Land. We intend for TheRoyaLand to be a novel interactive, immersive game based on a player-empowered design. The plan is to build proprietary digital avatars and provide opportunities to players to earn in-game reward currency, build virtual land, and own their online assets while enhancing all of these features with what we consider to be premium incremental in-game content. TheRoyaLand game is currently in development.
We have engaged the services of Neosperience S.p.A. to work with us to develop TheRoyal.Land. See Note 4. Neosperience will design and develop TheRoyal.Land using its proprietary technology. Neosperience plans to use its models to create complex and dynamic in-game environments and realistic and emotive characters and to assist with dynamically adjusting the difficulty level and game balance in real time based on player behavior and performance to keep the game challenging yet rewarding. For example, Neosperience’s technology is designed to imbue non-player characters (“NPCs”), with various behaviors, which we believe makes them seem more lifelike and responsive thereby enhancing player immersion and creating a more engaging gameplay experience. Additionally, Neosperience intends to use advanced modeling and rendering techniques to create realistic player characters and NPCs that dynamically interact utilizing a full range of human-like emotions, reactions, and movements giving them a depth of character which we believe is rarely seen in video games.
Our Company, through Neosperience, has been working on the design and development of the game since mid-2023 and is currently working on the first fully playable portion of the game which will be used to promote the game with publishers and other interested parties (the “Vertical Slice”). The Vertical Slice is designed to show the intended player experience and demonstrate where the key features and systems work together seamlessly with the assets representing the final quality. The Vertical Slice will include 5 different missions that will be released for internal and external demonstration and testing in phases. The first mission was released in September 2024. The remaining missions will be released on a regular basis following the first mission. We estimate finalizing the Vertical Slice with all five missions in the first quarter of calendar year 2025.
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A demo of the first mission can be seen at the following link:
| ● | https://drive.google.com/file/d/1U0FET2P6PULWtwLbXc7rt95r4L66QV99/view?usp=sharing |
See Notes 3 and 4 for further information regarding the SEA and the Acquisition.
| 2. | Summary of Significant Accounting Policies |
Basis of Presentation and Consolidation
The accompanying interim condensed consolidated financial statements (the “financial statements”), including comparatives, have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and interpretations issued by the International Financial Reporting Interpretations Committee (“IFRIC). Our year-end is June 30.
The accompanying financial statements include the accounts of the registrant, RoyaLand Ltd, Royaland Company and OAPLT. All intercompany transactions and balances have been eliminated. As stated in Note 1, the SEA resulted in a common control acquisition while the acquisition of OAPLT resulted in a business combination.
Functional and Presentation Currency
The accompanying financial statements are prepared in the U.S. dollar, which is the functional currency of RoyaLand Ltd. RoyaLand Company’s functional currency is also the U.S. dollar and OAPLT’s functional currency is the euro. All financial information has been rounded to the nearest dollar except where indicated otherwise.
Going Concern Considerations
The accompanying financial
statements contemplate continuation of our Company as a going concern. We have incurred net losses since our inception and we have an
accumulated deficit of $
On May 1, 2022, our wholly owned subsidiary RoyaLand Company entered into an agreement with Boustead Securities LLC (“Boustead”) under which Boustead agreed to provide certain services to us with respect to corporate financing transactions, including the private placement of securities. See Note 4 for further information. While we are confident we will be able to raise additional capital through this process, there are no assurances that we will be successful in obtaining such additional capital. If our working capital needs are not met and we are unable to obtain adequate capital, we could be forced to cease operations. The accompanying financial statements do not include any adjustments that might be necessary if our Company is unable to continue as a going concern.
Foreign Currency
Items included in the financial statements of each of our Company’s subsidiaries are measured using the currency of the primary economic environment in which each subsidiary operates (the functional currency). The accompanying financial statements are presented in U.S. dollars, the functional currency of RoyaLand Ltd.
The results and financial position of OAPLT, our Company’s subsidiary that has a different functional currency, are translated from euros into U.S. dollars as follows:
| (i) | Assets and liabilities are translated at the current exchange rate at the balance sheet date and historical rates for equity; |
| (ii) | Revenue and expenses are translated at the weighted average closing exchange rate for the period reported in the consolidated statement of profit or loss. When the average exchange rate does not provide a reasonable approximation of the cumulative effect of the rates prevailing on the transaction date, the Company utilizes the closing exchange rate on the date of the transaction. |
| (iii) | Gains and losses resulting from foreign currency translation are included as a component of stockholders’ equity. Foreign currency transaction gains and losses are included in the results of operations. |
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Use of Estimates
The preparation of financial statements in conformity with IFRS requires management to make estimates, judgements and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenues, and expenses during the period. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. Areas in which management has made critical judgments in the process of applying accounting policies and that have the most significant effect on the amounts recognized in the financial statements include the determination of our Company’s functional currencies and the collectability of our accounts receivable and deferred offering costs. Information about key assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment to the carrying amount of assets and liabilities within the next financial year are included in the following notes to the financial statements for the periods presented.
Cash and Cash Equivalents
We consider all short-term
investments readily convertible to cash, without notice or penalty, with an initial maturity of 90 days or less to be cash equivalents.
Our cash balances as of December 31, 2024 and June 30, 2024 were $
Fair Value of Financial Instruments
Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants as of the measurement date. Applicable accounting guidance provides an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of our Company. Unobservable inputs are inputs that reflect our Company’s assumptions about the factors that market participants would use in valuing the asset or liability. The fair value hierarchy consists of the following three levels of inputs that may be used to measure fair value:
| Level 1 | — | Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. | |||
| Level 2 | — | Inputs other than quoted prices included in Level 1 that are observable in the marketplace either directly (i.e., as prices) or indirectly (i.e., derived from prices). | |||
| Level 3 | — | Unobservable inputs which are supported by little or no market activity. |
For assets and liabilities, such as cash, prepaid expenses and accounts payable/accrued liabilities, and other current liabilities maturing within one year from the balance sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments.
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Fair Value Hierarchy of liabilities that are recognized and measured at fair value in the financial statements as of December 31, 2024 and June 30, 2024 (level 3 inputs are not applicable):
| Fair Value Measurement Using | ||||||||
| Level 1 | Level 2 | |||||||
| LIABILITIES | ||||||||
| December 31, 2024: | ||||||||
| Due to related party – recognized at fair value (1) | $ | $ | ||||||
| June 30, 2024: | ||||||||
| Due to related party – recognized at fair value (1) | $ | $ | ||||||
| (1) |
During the periods presented, there were no transfers between Levels 1, 2 or 3.
Financial risk factors
Our activities expose us to a variety of financial risks: market risk, credit risk and liquidity risk. Our primary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on our financial performance.
The primary market risk to the Company is foreign exchange risk. Given the stability of the markets in which we operate, we believe our exposure to be minimal. Our exposure to credit risk is influenced mainly by the individual characteristic of each customer and the concentration of risk from the top few customers. Given that we have not generated any revenue in the periods presented in the financial statements, we have no exposure to credit risk. With respect to liquidity, our ability to meet our obligations on time is dependent on the success of our operation and the support of our related party partners, which to date have given us adequate liquidity to meet our obligations.
Deferred Offering Costs
Deferred offering costs consist
of underwriting, legal, accounting, and other expenses incurred through the balance sheet date that are directly related to a planned
offering described in Note 4 under the caption Boustead Agreement. During the six months ended December 31, 2024, we charged the
deferred offering costs of $
Income Taxes
Income tax expense comprises current and deferred taxes. Current taxes and deferred taxes are recognized in profit or loss except to the extent that they relate to a business combination, or items recognized directly in equity or in other comprehensive loss.
Current taxes are the expected tax receivable or payable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax receivable or payable in respect of previous years. Deferred taxes are recognized in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.
Deferred taxes are not recognized for the following temporary differences: the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss, and differences relating to investments in subsidiaries and jointly controlled entities to the extent that it is probable that they will not reverse in the foreseeable future.
In addition, deferred taxes are not recognized for taxable temporary differences arising on the initial recognition of goodwill. Deferred taxes are measured at the tax rates that are expected to be applied to temporary differences when they reverse, based on the tax laws that have been enacted or substantively enacted by the reporting date. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax assets and liabilities, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax assets and liabilities on a net basis or their tax assets and liabilities will be realized simultaneously. A deferred tax asset is recognized for unused tax losses, tax credits and deductible temporary differences, to the extent that it is probable that future taxable profits will be available against which they can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.
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Net Income/Loss Per Share
Under
the provisions of IAS 33, Earnings per Share, basic loss per common share is computed by dividing net loss available to each class
of common shareholders by the weighted average number of shares of common shares outstanding for the period presented for their respective
class. Diluted loss per share reflects the potential dilution that could occur if securities or other contracts to issue common shares
were exercised or converted into common shares or resulted in the issuance of common shares that would then share in the income of our
Company, subject to anti-dilution limitations. As of December 31, 2024 and December 31, 2023, there were
The table below presents the computation of the basic and diluted loss per share for the periods July 1, 2024 to December 31, 2024 and July 1, 2023 to December 31, 2023
| Period July 1, 2024 to December 31, 2024 | Period July 1, 2023 to December 31, 2023 | |||||||||||||||
| Class A Common Shares | Class B Common Shares | Class A Common Shares | Class B Common Shares | |||||||||||||
| Numerator: | ||||||||||||||||
| Net loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Net loss allocated between Class A and Class B common shares | ( | ) | ( | ) | $ | ( | ) | $ | ( | ) | ||||||
| Denominator: | ||||||||||||||||
| Weighted average common shares outstanding — basic | ||||||||||||||||
| Dilutive common share equivalents | ||||||||||||||||
| Weighted average common shares outstanding — diluted | ||||||||||||||||
| Net loss per share: | ||||||||||||||||
| Basic | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Diluted | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
New Accounting Pronouncements
We have reviewed all accounting pronouncements recently issued by the IAS and have determined that they are either not applicable or are not believed to have a material impact on our present or future consolidated financial statements.
| 3. | Related Party Transactions |
Amounts due to related parties as of December 31, 2024 and June 30, 2024 consist of:
| December 31, 2024 | June 30, 2024 | |||||||
| Daniel McClory, Executive Chairman and Director | $ | $ | ||||||
| Alberto Libanori, Director | ||||||||
| Due to related party – recognized at fair value (1) | $ | $ | ||||||
From time to time, our officers
and shareholders have made advances to us which we have recorded as Due to Related Parties in the amounts of $
On April 23, 2024, we entered
into an independent director agreement with Alberto Libanori and agree to compensate Mr. Libanori $
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| 4. | Agreements |
Boustead Agreement
On May 1, 2022, our wholly
owned subsidiary RoyaLand Company entered into an agreement with Boustead Securities, LLC (“Boustead”) under which Boustead
agreed to provide certain services to us with respect to corporate financing transactions, including the private placement of securities
and the IPO of our common shares that will be applied for listing on a stock exchange, and any post-IPO financings we may complete from
time to time. Under the agreement, we agreed to pay certain other fees and warrants as described in the agreement. For financing transactions,
we agreed to pay a success fee equal to seven percent (
Neosperience Agreement
In July 2023, we signed an
agreement with Neosperience S.p.A. under which Neosperience agreed to provide consulting and development services (the “Project”)
with respect to our MMORPG, called TheRoyal.Land. The Project is to be accomplished in five phases. The first four phases of the
Project are the research phase with the final phase being the development phase. As compensation for their services, we agreed to pay
Neosperience a total amount ranging from €
As of December 31, 2024, we
have incurred a total expense of $
Skyline Agreement
In July 2023, we entered into
an investor relations services agreement with Skyline Corporate Communications Group. The agreement has a term of twelve (
In the fourth quarter of calendar
2023, Skyline agreed to temporarily postpone any further payments due them under the agreement and instead utilize their services on an
as-needed basis. During the six-month periods ended December 31, 2024 and 2023, we recorded operating expenses of $
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| 5. | Capital Shares |
Preference Shares
We are authorized to issue
Common Shares
We are authorized to issue
Class A Common Shares – we
have designated and authorized
Class B Common Shares – we
have designated authorized
Sales of Shares
During the six months ended
December 31, 2023, we conducted private placements of our Class B Common Shares and issued to investors
| a. | Private placements of Class B common shares with a number of
investors under which we issued |
|
| b. | Private placements of units of securities, consisting of (i)
|
The Class B Common Shares are subject to certain lockup provisions until 180 days after the commencement of trading of our Class B Common Shares, subject to certain exceptions.
Share Option
On May 20, 2024, we granted
an option to purchase
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We valued the share option
at $
| Expected term in years | ||
| Risk-free interest rate | ||
| Annual expected volatility | ||
| Dividend yield |
Risk-free interest rate: We use the risk-free interest rate of a U.S. Treasury Bill with a similar term on the date of the option grant.
Volatility: We estimate the expected volatility of the stock price based on the corresponding volatility of our historical stock price.
Dividend yield: We use a
Remaining term: The remaining term is based on the remaining contractual obligation of the share option.
Activity related to the share option for the six months ended December 31, 2024 is as follows:
| Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Life in Years | Aggregate Intrinsic Value | |||||||||||||
| Outstanding, June 30, 2024 | $ | |||||||||||||||
| Activity during the six months ended December 31, 2024 | — | — | ||||||||||||||
| Outstanding, December 31, 2024 | ||||||||||||||||
| Exercisable, end of period | $ | $ | ||||||||||||||
Warrants
In connection with the sales
of Class B Common Shares during the six months ended December 31, 2023, we issued Boustead 5-year warrants to purchase a total of
| Expected term in years | ||
| Risk-free interest rate | ||
| Annual expected volatility | ||
| Dividend yield |
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Activity related to the warrants for the six months ended December 31, 2024 is as follows:
| Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Life in Years | Aggregate Intrinsic Value | |||||||||||||
| Outstanding, June 30, 2024 | $ | |||||||||||||||
| Activity during the six months ended December 31, 2024 | — | $ | — | |||||||||||||
| Outstanding, December 31, 2024 | $ | |||||||||||||||
| Exercisable, end of period | $ | $ | ||||||||||||||
Equity Incentive Plan
In February 2023, we adopted
the 2023 Equity Incentive Plan under which
| 6. | Subsequent Events |
Private Placement
In April 2025, we conducted
a private placement of our Class B Common Shares and issued
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