Instinct Bio Technical Co Holdings Inc 6-K, filed Oct 16, 2026
Instinct Bio Technical Co Holdings Inc. (BIOT)
About this 6-K
Instinct Bio Technical Co Holdings Inc filed this 6-K on October 16, 2026.
Instinct Bio Technical Company Holdings Inc. furnished unaudited six-month results for Instinct Bio Technical Company Inc. (BIOT Group) ended May 31, 2026, reporting revenue of 1,142,598, profit after tax of 90,251 versus a prior-period loss of (206,817), and total assets of 4,080,414. AI summary
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of October 2026
Commission File Number: 001-43415
Instinct Bio Technical Company Holdings Inc.
(Exact name of registrant as specified in its charter)
3rd Floor West Side Gotanda bldg.
6-2-7 Nishi Gotanda, Shinagawa-ku
Tokyo 141-0031, Japan
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F x Form 40-F ¨
INFORMATION CONTAINED IN THIS REPORT ON FORM 6-K
On October 16, 2026, Instinct Bio Technical Company Holdings Inc. (the “Company”) issued a press release announcing the unaudited financial results of Instinct Bio Technical Company Inc. and its subsidiaries for the six months ended May 31, 2026. A copy of the press release is furnished as Exhibit 99.3 to this report on Form 6-K.
The unaudited condensed consolidated interim financial statements of Instinct Bio Technical Company Inc. and its subsidiaries as of May 31, 2026 and for the six months ended May 31, 2026 and 2025, and the related Management’s Discussion and Analysis of Financial Condition and Results of Operations, are furnished as Exhibits 99.1 and 99.2, respectively, to this report on Form 6-K.
EXHIBIT INDEX
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Instinct Bio Technical Company Holdings Inc. | ||
| By: | /s/ Masashi Ohmatsu | |
| Name: | Masashi Ohmatsu | |
| Title: | Chief Financial Officer | |
Date: October 16, 2026
Exhibit 99.1
Instinct Bio Technical Company Inc. (OC-420235)
("BIOT")
Together with its subsidiaries comprising the BIOT Group:
| Subsidiary | Registration No. |
| Instinct Brothers Co. Ltd. | 3011401015509 |
| Artisan Production Co. Ltd. | 1080401024564 |
| Hiroki Global Co. Ltd. | 1011402006954 |
| Instinct RAS Co. Ltd. | 8011001140132 |
(Hereinafter collectively referred to as the "Group" or "BIOT Group")
FINANCIAL PERIOD
MAY 31,2026
(December 1, 2025 to May 31, 2026)
BIOT GROUP
TABLE OF CONTENTS
| Consolidated Financial Statements: | |
| Unaudited Consolidated Statement of Financial Position at 31 May 2026 and Audited Consolidated Statement of Financial Position at 30 November 2025 | 1 |
| Unaudited Consolidated Statement of Profit or Loss And Other Comprehensive Income For The Period From 1 December 2025 to 31 May 2026 And Period From 1 December 2024 to 31 May 2025 | 2 |
| Unaudited Consolidated Statement of Changes in Equity For The Period From 1 December 2025 To 31 May 2026 And Period From 1 December 2024 To 31 May 2025 | 3 |
| Unaudited Consolidated Statement of Cash Flows For The Period From 1 December 2025 To 31 May 2026 And Period From 1 December 2024 to 31 May 2025 | 4-5 |
| Notes to Unaudited Consolidated Financial Statements | 6-34 |
BIOT GROUP
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
| As at | As at | ||||||||||
| 31 May | 30 Nov | ||||||||||
| 2026 | 2025 | ||||||||||
| Unaudited | Audited | ||||||||||
| Note | USD | USD | |||||||||
| ASSETS | |||||||||||
| Non-current assets | |||||||||||
| Property, plant and equipment | 4 | 775,634 | 809,211 | ||||||||
| Intangible asset | 5 | 11,408 | 19,025 | ||||||||
| Right-of-use assets | 6 | 104,128 | 154,572 | ||||||||
| Other receivables | 9 | 104,232 | 111,573 | ||||||||
| 995,402 | 1,094,381 | ||||||||||
| Current assets | |||||||||||
| Inventories | 7 | 474,697 | 394,689 | ||||||||
| Trade receivables | 8 | 281,331 | 274,403 | ||||||||
| Other receivables | 9 | 2,285,103 | 1,091,788 | ||||||||
| Tax recoverable | 18,316 | 14,964 | |||||||||
| Cash and bank balances | 25,565 | 124,764 | |||||||||
| 3,085,012 | 1,900,608 | ||||||||||
| Total assets | 4,080,414 | 2,994,989 | |||||||||
| EQUITY | |||||||||||
| Invested share capital * | 10 | 220 | 220 | ||||||||
| Retained earnings | 2,968,231 | 2,877,980 | |||||||||
| Merger reserve | 11 | 82,600 | 82,600 | ||||||||
| Foreign currency translation reserve | (964,864 | ) | (918,205 | ) | |||||||
| Total equity | 2,086,187 | 2,042,595 | |||||||||
| LIABILITIES | |||||||||||
| Non-current liability | |||||||||||
| Lease liabilities | 12 | 77,523 | 125,403 | ||||||||
| Current liabilities | |||||||||||
| Trade payables | 73,438 | 25,129 | |||||||||
| Other payables | 13 | 1,748,112 | 687,637 | ||||||||
| Lease liabilities | 12 | 94,930 | 112,468 | ||||||||
| Taxation | 224 | 1,757 | |||||||||
| 1,916,704 | 826,991 | ||||||||||
| Total liabilities | 1,994,227 | 952,394 | |||||||||
| Total equity and liabilities | 4,080,414 | 2,994,989 | |||||||||
* Number of ordinary shares on consolidated basis
The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
BIOT GROUP
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND COMPREHENSIVE INCOME
| Six Months Period | |||||||||||
| 1 December 2025 | 1 December 2024 | ||||||||||
| to | to | ||||||||||
| 31 May | 31 May | ||||||||||
| 2026 | 2025 | ||||||||||
| Unaudited | Unaudited | ||||||||||
| Note | USD | USD | |||||||||
| Revenue | 14 | 1,142,598 | 1,091,050 | ||||||||
| Cost of sales | (313,608 | ) | (221,729 | ) | |||||||
| Gross profit | 828,990 | 869,321 | |||||||||
| Other income | 6,291 | 6,472 | |||||||||
| Net impairment losses on financial assets | - | (13,484 | ) | ||||||||
| Administrative expenses | (741,691 | ) | (1,060,969 | ) | |||||||
| Finance costs | (3,314 | ) | (8,117 | ) | |||||||
| Profit/(Loss) before taxation | 90,276 | (206,777 | ) | ||||||||
| Taxation | (25 | ) | (40 | ) | |||||||
| Profit/(Loss) after tax | 90,251 | (206,817 | ) | ||||||||
| Other comprehensive income that may be reclassified subsequently to profit or loss: | |||||||||||
| Exchange translation differences | (46,659 | ) | 88,213 | ||||||||
| Total comprehensive income/(loss) for the financial period | 43,592 | (118,604 | ) | ||||||||
| Earnings/(Loss) per share | |||||||||||
| - Basic | 0.00 | * | (0.01 | ) | |||||||
* Nominal amount rounded to USD0
The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
BIOT GROUP
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
| For the six months ended May 31, 2026 | ||||||||||||||||||||
| Invested share capital | Retained earnings | Merger Reserve | Currency translation differences | Total | ||||||||||||||||
| USD | USD | USD | USD | USD | ||||||||||||||||
| The Group | ||||||||||||||||||||
| As at December, 1 2025 | 220 | 2,877,980 | 82,600 | (918,205 | ) | 2,042,595 | ||||||||||||||
| Profit for the financial period | - | 90,251 | - | - | 90,251 | |||||||||||||||
| Other comprehensive loss | - | - | - | (46,659 | ) | (46,659 | ) | |||||||||||||
| Total comprehensive profit/(loss) for the financial period | - | 90,251 | - | (46,659 | ) | 43,592 | ||||||||||||||
| As at 31 May 2026 | 220 | 2,968,231 | 82,600 | (964,864 | ) | 2,086,187 | ||||||||||||||
| For the six months ended May 31, 2025 | ||||||||||||||||||||
| Invested share capital | Retained earnings | Merger Reserve | Currency translation differences | Total | ||||||||||||||||
| USD | USD | USD | USD | USD | ||||||||||||||||
| The Group | ||||||||||||||||||||
| As at December, 1 2024 | 83,600 | 3,106,629 | - | (853,096 | ) | 2,337,133 | ||||||||||||||
| Loss for the financial period | - | (206,817 | ) | - | (206,817 | ) | ||||||||||||||
| Other comprehensive income | - | - | - | 88,213 | 88,213 | |||||||||||||||
| Total comprehensive (loss)/ profit for the financial period | - | (206,817 | ) | - | 88,213 | (118,604 | ) | |||||||||||||
| As at 31 May 2025 | 83,600 | 2,899,812 | - | (764,883 | ) | 2,218,529 | ||||||||||||||
The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
BIOT GROUP
CONSOLIDATED STATEMENT OF CASH FLOWS
| Six Months Period | |||||||||||
| 1 December 2025 | 1 December 2024 | ||||||||||
| to | to | ||||||||||
| 31 May | 31 May | ||||||||||
| 2026 | 2025 | ||||||||||
| Unaudited | Unaudited | ||||||||||
| Note | USD | USD | |||||||||
| Cash flows used in operating activities | |||||||||||
| Profit/(Loss) before taxation | 90,276 | (206,777 | ) | ||||||||
| Adjustments for: | |||||||||||
| Depreciation and amortisation of: | |||||||||||
| - property, plant and equipment | 35,216 | 38,512 | |||||||||
| - intangible assets | 6,822 | 10,524 | |||||||||
| - right-of-use assets | 48,786 | 70,007 | |||||||||
| Interest income | (146 | ) | (261 | ) | |||||||
| Loss on disposal of property, plant and equipment | - | 1,516 | |||||||||
| Interest expense | 3,314 | 8,117 | |||||||||
| Net impairment loss on | |||||||||||
| - trade and other receivables | - | 13,484 | |||||||||
| Gain on unrealised foreign currency exchange | (28,849 | ) | - | ||||||||
| Operating profit/(loss) before changes in working capital | 155,419 | (64,878 | ) | ||||||||
| Changes in working capital: | |||||||||||
| Inventories | (80,008 | ) | (160,239 | ) | |||||||
| Trade receivables | (6,926 | ) | 187,921 | ||||||||
| Other receivables | (1,167,221 | ) | (552,234 | ) | |||||||
| Trade payables | 48,309 | (35,363 | ) | ||||||||
| Other payables | 1,060,476 | 271,034 | |||||||||
| Cash generated from/(used in) operations | 10,049 | (353,759 | ) | ||||||||
| Interest received | 146 | 261 | |||||||||
| Interest paid | - | (7,040 | ) | ||||||||
| Tax paid | (22,518 | ) | (13,879 | ) | |||||||
| Tax refunded | - | 3,013 | |||||||||
| Net cash used in operating activities | (12,323 | ) | (371,404 | ) | |||||||
BIOT GROUP
CONSOLIDATED STATEMENTS OF CASH FLOWS (Cont’d)
| Six Months Ended | ||||||||||
| 1 December 2025 | 1 December 2024 | |||||||||
| to | to | |||||||||
| 31 May | 31 May | |||||||||
| 2026 | 2025 | |||||||||
| Unaudited | Unaudited | |||||||||
| Note | USD | USD | ||||||||
| Cash flows used in investing activities | ||||||||||
| Additions of: | ||||||||||
| - property, plant and equipment | (11,813 | ) | (36,006 | ) | ||||||
| - intangible assets | - | - | ||||||||
| Proceeds from disposal of property, plant and equipment | - | 15,156 | ||||||||
| Net cash used in investing activities | (11,813 | ) | (20,850 | ) | ||||||
| Cash flows used in financing activities | ||||||||||
| Repayment of lease liabilities | i | (70,790 | ) | (70,599 | ) | |||||
| Interest paid in relation to lease liabilities | i | (3,314 | ) | (1,078 | ) | |||||
| Net cash used in financing activities | (74,104 | ) | (71,677 | ) | ||||||
| Net decrease in cash and cash equivalents | (98,240 | ) | (463,931 | ) | ||||||
| Effect of exchange rate fluctuations on cash and cash equivalent | (959 | ) | 46,361 | |||||||
| Cash and cash equivalents at the beginning of the financial period | 124,764 | 512,446 | ||||||||
| Cash and cash equivalents at the end of the financial period | 25,565 | 94,876 | ||||||||
| Notes to the consolidated statements of cash flows | ||||||||||
| i. Cash outflows for leases as a lessee | ||||||||||
| Included in net cash from financing activities | ||||||||||
| Payment of lease liabilities | 70,790 | 70,599 | ||||||||
| Interest paid in relation to lease liabilities | 3,314 | 1,078 | ||||||||
| 74,104 | 71,677 | |||||||||
| * During the current and previous financial period, the Group acquired property, plant and equipment through the following arrangements: | ||||||||||
| Financed by: | ||||||||||
| Cash payments | 11,813 | 36,006 | ||||||||
The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
INSTINCT BIO TECHNICAL COMPANY INC. (OC-420235)
(Incorporated in the Cayman Islands on 28 March 2025)
NOTES TO THE UNAUDITED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
Financial Period: December 1, 2025 to May 31, 2026
Note 1. Corporate Information
Instinct Bio Technical Company Inc. (“BIOT” or “Company”) was incorporated in Cayman Islands on 28 March 2025 as an exempted company with limited liability under the Cayman Islands Companies Act (as revised). The Company's registered office situated at the office of Ogier Global (Cayman) Limited, 89 Nexus Way, Camana Bay, Grand Cayman, KY1-9009, Cayman Islands.
The principal activity of the Company is investment holding. The Company does not carry on any business operations directly. All operating activities are conducted through its subsidiaries.
Group structure
Nagano Tomoki (the "Founder") was the controlling shareholder of the Company, Instinct Brothers Co. Ltd. and Hiroki Global Co. Ltd.. Pursuant to the reorganisation, the Founder became the ultimate beneficial owner of the Group through his shareholding in BIOT, the holding company.
The details of the entities comprising the Group as follows:
| Entities | Jurisdiction | Date of incorp. | Effective
interest |
Principal
place of business | ||||
| Instinct Bio Technical Company Inc. (“BIOT”) | Cayman Islands | March 28, 2025 | N/A | Investment holding | ||||
| Instinct Brothers Co. Ltd. (3011401015509) (“ISB”) | Japan | February 21, 2011 | 100% | West Side Gotanda Building, Level 3, 6-2-7, Nishi Gotanda, Shinagawa City, Tokyo, Japan | ||||
| Hiroki Global Co. Ltd. (1011402006954) (“Hiroki”) | Japan | March 19, 1999 | 100% | West Side Gotanda Building, Level 3, 6-2-7, Nishi Gotanda, Shinagawa City, Tokyo, Japan |
| Entities | Jurisdiction | Date of incorp. | Effective interest |
Principal place of business | ||||
| Instinct Ras Co. Ltd. (8011001140132) (“Ras”) | Japan | April 4, 2021 | 100% | West Side Gotanda Building, Level 3, 6-2-7, Nishi Gotanda, Shinagawa City, Tokyo, Japan | ||||
| Artisan Production Co. Ltd. (1080401024564) (“AP”) | Japan | September 18, 2020 | 100% | 9899, Obuchi, Kakegawa City, Shizuoka Prefecture, Japan |
ISB, Hiroki, AP, and Ras are collectively referred to as the "Subsidiaries". The Company and its Subsidiaries are collectively referred to as the "Group".
Reorganization
The Group was assembled through a series of reorganization transactions (collectively, the "Reorganization") all occurring within the financial year ended November 30, 2025. The key steps of the Reorganization, were as follows:
| Date | Event | Description | ||
| 28 Mar 2025 | BIOT incorporated | The Company was incorporated in the Cayman Islands with one ordinary share of USD0.00001. The Company's shares were registered in the name of Ogier Global Subscriber (Cayman) Limited as bare nominee for the Founder. Beneficial ownership of the Company rested with the Founder from the date of incorporation. | ||
| 12 Apr 2025 | Transfer of BIOT share and allotment of new 99,999,999 shares | Nominee transferred one ordinary BIOT share to the founder. 99,999,999 ordinary shares of the Company were allotted and issued to the Founder at USD 0.00001 per share (aggregate consideration: USD 1,000). | ||
| 1 May 2025 | ISB acquired Hiroki | ISB acquired 118 Hiroki shares, representing 100% equity interest in Hiroki from the Founder pursuant to a share sale agreement dated 1 May 2025, discharged in full by the issuance of 1 new ISB ordinary shares to the Founder. Subsequently ISB repurchased and cancelled 1 ordinary ISB share. |
| Date | Event | Description | ||
| 15 Jun 2025 | BIOT acquired ISB | The Company acquired 500 ISB shares, representing 100% equity interest in ISB from the Founder pursuant to a share sale agreement dated 15 June 2025. The purchase consideration was fully discharged by the prior allotment of 100,000,000 ordinary shares of the Company to the Founder, constituting full and final settlement with no further consideration payable. | ||
| 21 Oct 2025 | Share repurchase | The Company repurchased 77,950,000 ordinary shares from the founder at USD 0.00001 per share (aggregate consideration: USD 780). |
The Reorganisation constitutes a combination of entities under common control, as all combining entities were controlled by the same individual (the Founder) both before and after each transaction. The Group has applied the predecessor cost method to the combination of entities. The consolidated financial statements are presented with the Subsidiaries' results included for the entire periods presented as if the Group had always been in its current structure.
Note 2: Basis of Presentation
Statement of Compliance
These unaudited condensed consolidated interim financial statements present the financial position of the Group as at May 31, 2026 and the results of its operations and cash flows for the six-month period from December 1, 2025 to May 31, 2026. The financial statements are unaudited, are presented in United States Dollars (“USD”), and have been prepared in accordance with IAS 34 Interim Financial Reporting as issued by the International Accounting Standards Board ("IASB"). The Group's annual consolidated financial statements are prepared in accordance with IFRS Accounting Standards as issued by the IASB. These condensed consolidated interim financial statements do not include all the information and disclosures required in annual financial statements and should be read in conjunction with the Group's audited consolidated financial statements for the financial year ended November 30, 2025 which are included as Exhibit 18.3 to the shell company report on Form 20-F filed by Instinct Bio Technical Company Holdings Inc. (formerly known as Relativity Holdings Inc.) with the U.S. Securities and Exchange Commission on July 29, 2026.
The financial statements have been prepared under the historical cost convention, unless otherwise indicated in the significant policies below.
Adoption of new and amended statements
The Group has adopted all the new, revised IAS, IFRS and interpretations and amendments to IAS, IFRS issued by the IASB that are mandatory for the financial year beginning on December 1, 2025, including Amendments to IAS 21, “Lack of Exchangeability”. The adoption of these pronouncements did not have a material effect on the financial statements of the Group.
Note 2: Basis of Presentation (Cont’d)
Standards issued but not yet effective
The following are accounting standards, amendments and interpretations of the IFRS framework that have been issued by the International Accounting Standards Board (“IASB”) but have not been adopted by the Group:
Annual periods beginning on/after 1 January 2026
Amendments to IFRS 7 and 9, “Classification and Measurement of Financial Instruments”
Amendments to IFRS 7 and 9, “Contracts Referencing Nature-dependent Electricity”
Annual Improvements to IFRS Accounting Standards—Volume 11
Annual periods beginning on/after 1 January 2027
IFRS 18, “Presentation in Financial Statements” (Original Issue)
IFRS 19, “Subsidiaries without Public Accountability: Disclosures”
Amendments to IFRS 19, “Subsidiaries without Public Accountability: Disclosures”
Amendments to IAS 21, “Translation to a Hyperinflationary Presentation Currency”
Amendments to IAS 128, “Amendments to Fair Value Option for Investments in Associates and Joint Ventures”
Annual periods beginning on/after 1 January 2029
IFRS 20, “Regulatory Assets and Regulatory Liabilities”
Effective date yet to be determined
Amendments to IFRS 10, “Consolidated Financial Statements” and IAS 28, “Investments in Associates and Joint Ventures” (Sale or Contribution of Assets between an Investor and its Associate or Joint Venture).
The Group intends to adopt the above new and amendments to IAS, IFRSs when they become effective.
The initial application of the above standards and amendments is not expected to have a material effect on the financial statements of the Group, except for IFRS 18, the effect of which on the presentation of the statement of profit or loss and related disclosures is currently being assessed.
Basis of consolidation
Subsidiaries are entities over which the Group has control. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Potential voting rights are considered in assessing control only when such rights are substantive. The Group also considers that it has de facto control over an investee when, despite not holding the majority of voting rights, it has the current practical ability to direct the activities of the investee that most significantly affect the investee's returns.
Note 2: Basis of Presentation (Cont’d)
Basis of consolidation (Cont’d)
All entities comprising the Group were under the common control of the same ultimate beneficial owner (the Founder, Nagano Tomoki) throughout the periods presented in these financial statements. Common control exists where the same ultimate beneficial owner controls all combining entities both before and after the combination, and that control is not transitory. In the case of this Group, the Founder has maintained continuous and uninterrupted control over all entities throughout the periods presented. Control is assessed by reference to beneficial ownership, board composition, and the terms of any nominee or trust arrangements. Business combinations under common control are excluded from the scope of IFRS 3 Business Combinations (IFRS 3.2(c)). In the absence of an IFRS that specifically applies, the Group has developed an accounting policy in accordance with IAS 8.10–12 and applied the predecessor cost method.
Under the predecessor cost method, the consolidated financial statements are presented as if the Group had always been in its current structure from the beginning of the earliest comparative period presented. All subsidiaries — including Hiroki Global Co. Ltd., which was not legally within the ISB subgroup prior to 1 May 2025 — are included throughout, on the basis that all entities were under the Founder's common control throughout those periods. There is no recognition of fair value adjustment or goodwill or gain on bargain purchase on any step of the Reorganization. The assets and liabilities of all combining entities are recognized at their pre-existing carrying amounts (predecessor carrying amounts). No fair value adjustments are made to any asset or liability of the combining entities.
In the Company's standalone financial statements, the cost of investment in each subsidiary is recorded at the nominal value of the shares issued as consideration. In the consolidated financial statements, this investment is eliminated against the subsidiaries' equity as part of the consolidation process.
Merger reserve is recognized when the net assets of the combining entities recognized at predecessor carrying amounts exceeded the nominal consideration given by the Company. The merger reserve is not distributable.
The results of all subsidiaries are included in the consolidated income statement for the entire periods presented, as if the Group had always been in its current structure. The Company's own costs (principally holding company and listing preparation costs) are included from 28 March 2025, being the date of the Company's incorporation, as the Company had no existence or activity prior to that date.
All intragroup transactions, balances, income, and expenses are eliminated in full on consolidation. Intragroup losses are also eliminated, except to the extent that the transaction provides evidence of an impairment of the asset transferred, in which case the loss is recognised in the consolidated financial statements. Where necessary, adjustments are made to the financial statements of a subsidiary to ensure consistency of accounting policies with those of the Group before consolidation.
Functional and presentation currency
The functional currency of the Company is United States Dollar (“USD”), being the currency of the primary economic environment in which they operate. The functional currency of the subsidiaries is Japanese Yen (“JPY”), being the currency of the primary economic environment in which they operate. The consolidated financial statements are presented in United States Dollars (“USD”), which is the presentation currency of the Group.
Note 2: Basis of Presentation (Cont’d)
Functional and presentation currency (Cont’d)
For the purpose of presentation in USD, assets and liabilities are translated at the closing rate at the reporting date, while income and expenses are translated at the exchange rates at the dates of the transactions, or average rates where these approximate actual rates. Resulting exchange differences are recognized in other comprehensive income and accumulated in the foreign currency translation reserve.
The translations of Japanese yen amounts into U.S. dollar amounts have been made at the following rates:
Balance sheet items, except for equity accounts:
| · | ¥156 to $1 the approximate rate of exchange at period ended November 30, 2025; and |
| · | ¥158 to $1 the approximate rate of exchange at period ended May 31, 2026. |
Items in the statements of operations and comprehensive income, and statements of cash flows:
| · | ¥149 to $1 the approximate rate of exchange at period ended May 31, 2025; and |
| · | ¥157 to $1 the approximate rate of exchange at period ended May 31, 2026. |
All financial information presented in USD have been rounded to the nearest dollar, unless otherwise stated.
Basis of going concern
The directors have reviewed the Group's financial projections, cash flow forecasts, and available financing for a period of not less than twelve months from the date of approval of these financial statements. Having performed this assessment, the directors are satisfied that the Group has adequate resources to continue as a going concern for the foreseeable future. These financial statements have accordingly been prepared on the going concern basis.
Note 3. Material Accounting Policy Information
The Group applies the material accounting policy information set out below, consistently throughout all periods presented in the consolidated financial statements unless otherwise stated.
| · | Property, plant and equipment |
Property, plant and equipment are stated at cost less accumulated depreciation and any accumulated impairment losses. The policy of recognition and measurement of impairment losses is in accordance with Note 3(f).
Note 3. Material Accounting Policy Information
| · | Property, plant and equipment |
| · | Recognition and measurement |
Cost includes expenditures that are directly attributable to the acquisition of the assets and any other costs directly attributable to bringing the asset to working condition for its intended use, cost of replacing component parts of the assets, and the present value of the expected cost for the decommissioning of the assets after their use. The cost of self-constructed assets also includes the cost of materials and direct labour. For qualifying assets, borrowing costs are capitalised in accordance with the accounting policy on borrowing costs. All other repair and maintenance costs are recognised in profit or loss as incurred.
When significant parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.
Property, plant and equipment are derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Gains or losses arising on the disposal of property, plant and equipment are determined as the difference between the disposal proceeds and the carrying amount of the assets and are recognised in profit or loss.
| · | Subsequent costs |
The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Group and its cost can be measured reliably. The costs of the day-to-day servicing of property, plant and equipment are recognised in the profit or loss as incurred.
| · | Depreciation |
| · | Freehold land is not depreciated. Depreciation is recognised in the profit or loss on straight line basis to write off the cost of each asset to its residual value over its estimated useful life. |
Except for freehold land, property, plant and equipment are depreciated based on the estimated useful lives of the assets as follows:
| Freehold buildings and renovation | 15 to 20 years |
| Signboard | 10 years |
| Motor vehicles | 6 years |
| Machineries | 10 years |
| Computers and equipment | 4 to 5 years |
The residual values, useful lives and depreciation method are reviewed at the end of each reporting period to ensure that the amount, method and period of depreciation are consistent with previous estimates and the expected pattern of consumption of the future economic benefits embodied in property, plant and equipment.
Note 3. Material Accounting Policy Information (Cont’d)
| · | Intangible assets |
Intangible assets acquired are measured initially at cost. Following initial acquisition, intangible asset is measured at cost less accumulated amortisation and any accumulated impairment losses.
The amortisation period and amortisation method of intangible asset with a finite useful life are reviewed at least at the end of each financial year. Intangible asset is reviewed for impairment whenever there is an indication that it may be impaired.
Software is amortised on a straight-line basis over its estimated useful life of 5 years.
Intangible asset is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. The difference between the net disposal proceeds, if any and the net carrying amounts is recognised in the profit or loss in the year the asset is derecognised.
| · | Financial assets |
Debt instruments
Financial assets are recognised in the statements of financial position when, and only when, the Group becomes a party to the contractual provisions of the financial instrument.
When financial assets are recognised initially, they are measured at fair value, plus, in the case of financial assets not at FVTPL, directly attributable transaction costs. The Group determines the classification of its financial assets at initial recognition, and the categories include trade and other receivables, financial assets at fair value through profit or loss and cash and bank balances.
| · | Financial assets at amortised cost |
The Group measures financial assets at amortised cost if both of the following conditions are met:
| · | The financial asset is held within a business model with the objective to hold financial assets in order to collect contractual cash flows; and |
| · | The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. |
Financial assets at amortised cost are subsequently measured using the effective interest (EIR) method and are subject to impairment. Gains and losses are recognised in profit or loss when the asset is derecognised, modified or impaired.
| · | Fair value through other comprehensive income |
The Group has not designated any financial assets as FVTOCI.
Note 3. Material Accounting Policy Information (Cont’d)
(c) Financial assets (Cont’d)
Debt instruments (Cont’d)
| · | Financial assets at fair value through profit or loss |
Debt instruments that are held for trading as well as those that do not meet the criteria for classification as amortised cost or FVOCI are classified as FVTPL. Movement in fair values and interest income is recognised in profit or loss in the period in which it arises.
| · | Inventories |
Finished goods are stated at the lower of cost and net realisable value after adequate allowance has been made for all deteriorated, damaged, obsolete or slow-moving inventories.
Cost of manufactured and trading products is determined on weighted average basis respectively. The cost comprises all costs of purchase, costs of conversion, direct labour, other direct costs and related production overheads based on normal operating capacity and other costs incurred in bringing the inventories to their present location and condition.
Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and the estimated costs necessary to make the sale.
| · | Impairment of financial assets |
The Group recognised an allowance for expected credit losses (“ECL”) for all debt instruments not held at FVTPL. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Group expects to receive, discounted at an approximation of the original effective interest rate. The expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms.
ECLs are recognised in two stages. For credit exposures for which there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12-months (“a 12-month ECL”). For those credit exposures for which there has been a significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the default (“a lifetime ECL”).
For trade receivables, the Group applies a simplified approach in calculating ECLs. Therefore, the Group does not track changes in credit risk, but instead recognises a loss allowance based on lifetime ECLs at each reporting date. The Group has established a provision matrix that is based on its historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment.
Note 3. Material Accounting Policy Information (Cont’d)
| · | Impairment of non-financial assets |
| · | Assets that have an indefinite useful life, such as goodwill or intangible assets not ready to use, are not subject to amortisation and are tested annually for impairment. Assets that are subject to amortisation and depreciation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. |
| · | For the purpose of impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or cash generating units. |
| · | The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or cash-generating unit. |
| · | An impairment loss is recognised if the carrying amount of an asset or its related cash-generating unit exceeds its estimated recoverable amount. Impairment losses are recognised in profit or loss. |
| · | Impairment losses recognised in prior periods are assessed at the end of each reporting period for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount since the last impairment loss was recognised. An impairment loss is reversed only to the extent that the asset’s carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised. Reversals of impairment losses are credited to profit or loss in the financial year in which the reversals are recognised. |
| · | Cash and cash equivalents |
| · | Cash and cash equivalents comprise cash in hand and cash at bank which are subject to an insignificant risk of changes in value. For the purpose of the statements of cash flows, cash and cash equivalents are presented net of bank overdrafts and pledged deposits, if any. |
| · | Share capital |
| · | Ordinary shares are classified as equity. Incremental transaction costs directly attributable to the issuance of new equity instruments are recognised as a deduction from equity, net of any tax effects. |
| · | Where the Company repurchases its own shares, the consideration paid — including any directly attributable transaction costs — is recognised as a deduction from equity. No gain or loss is recognised in profit or loss on the repurchase, reissuance, or cancellation of treasury shares. Repurchased shares are presented as a separate deduction within equity until they are cancelled or reissued. |
Note 3. Material Accounting Policy Information (Cont’d)
| · | Revenue recognition |
| · | Revenue from contracts with customers |
| · | Revenue is recognised when the Group satisfied a performance obligation (“PO”) by transferring a promised good or services to the customer, which is when the customer obtains control of the good or service. A PO may be satisfied at a point in time or over time. The amount of revenue recognised is the amount allocated to the satisfied PO. |
| · | The Group recognises revenue from the sales of goods and services rendered. Revenue from sale of goods is recognised when control of the products has transferred, and the payment terms can be identified, and it is probable that the Group will collect the consideration to which it will be entitled to in exchange of those goods or services, being at the point the customer purchases the goods. |
| · | Revenue is recognised based on the price specified in the contract net of the rebates, discounts and taxes. Payment of the transaction price is due after credit term of 30 days from the point the customer purchases the goods. |
| · | It is the Group’s policy to sell its products to the end customer with a right of return within 14 days. The Group uses its accumulated historical experience to estimate the number of returns using the expected value method. It is highly probable that a significant reversal in the cumulative revenue recognised will not occur given the consistent level of returns over previous years. The validity of this assumption and the estimated amount of returns are reassessed at each reporting date. No contract liability (refund liability) nor the right to the returned goods are recognised for the products expected to be returned as the return rate is assessed to be insignificant, based on accumulated experience of the Group. |
| · | Other revenue and income |
Revenue and income from other sources are recognised as follows:
Rental income
Rental income is recognised on a straight-line basis over the tenure of the lease.
Interest income
Interest income is recognised on an accrual basis using the effective interest method.
Note 4: Property, plant and equipment
| Land | Freehold buildings, renovation and signboard | Machineries | Motor vehicles | Computers and equipment | Total | |||||||||||||||||||
| USD | USD | USD | USD | USD | USD | |||||||||||||||||||
| Cost | ||||||||||||||||||||||||
| At 1 December 2024 | 329,213 | 461,434 | 102,089 | 239,618 | 11,712 | 1,144,066 | ||||||||||||||||||
| Addition | - | - | - | 84,944 | - | 84,944 | ||||||||||||||||||
| Disposal | - | - | - | (50,050 | ) | - | (50,050 | ) | ||||||||||||||||
| Written off | - | (22,757 | ) | - | - | - | (22,757 | ) | ||||||||||||||||
| Currency translation differences | (13,310 | ) | (17,714 | ) | (4,128 | ) | (11,132 | ) | (474 | ) | (46,758 | ) | ||||||||||||
| At 30 November 2025 | 315,903 | 420,963 | 97,961 | 263,380 | 11,238 | 1,109,445 | ||||||||||||||||||
| Addition | - | - | 11,005 | - | 808 | 11,813 | ||||||||||||||||||
| Currency translation differences | (4,030 | ) | (5,370 | ) | (1,321 | ) | (3,360 | ) | (149 | ) | (14,230 | ) | ||||||||||||
| At 31 May 2026 | 311,873 | 415,593 | 107,645 | 260,020 | 11,897 | 1,107,028 | ||||||||||||||||||
| Accumulated depreciation | ||||||||||||||||||||||||
| At 1 December 2024 | - | 92,551 | 33,518 | 148,451 | 4,519 | 279,039 | ||||||||||||||||||
| Addition | - | 24,736 | 10,219 | 38,338 | 2,419 | 75,712 | ||||||||||||||||||
| Disposal | - | - | - | (34,062 | ) | - | (34,062 | ) | ||||||||||||||||
| Written off | - | (7,770 | ) | - | - | - | (7,770 | ) | ||||||||||||||||
| Currency translation differences | - | (4,445 | ) | (1,778 | ) | (6,179 | ) | (283 | ) | (12,685 | ) | |||||||||||||
| At 30 November 2025 | - | 105,072 | 41,959 | 146,548 | 6,655 | 300,234 | ||||||||||||||||||
| Addition | - | 10,516 | 5,050 | 18,736 | 914 | 35,216 | ||||||||||||||||||
| Currency translation differences | - | (1,408 | ) | (568 | ) | (1,989 | ) | (91 | ) | (4,056 | ) | |||||||||||||
| At 31 May 2026 | - | 114,180 | 46,441 | 163,295 | 7,478 | 331,394 | ||||||||||||||||||
Note 4: Property, plant and equipment (Cont’d)
| Land | Freehold buildings, renovation and signboard | Machineries | Motor vehicles | Computers and equipment | Total | |||||||||||||||||||
| USD | USD | USD | USD | USD | USD | |||||||||||||||||||
| Carrying amount | ||||||||||||||||||||||||
| Audited | ||||||||||||||||||||||||
| At 30 November 2025 | 315,903 | 315,891 | 56,002 | 116,832 | 4,583 | 809,211 | ||||||||||||||||||
| Unaudited | ||||||||||||||||||||||||
| At 31 May 2026 | 311,873 | 301,413 | 61,204 | 96,725 | 4,419 | 775,634 | ||||||||||||||||||
Note 5: Intangible Asset
| Software | ||||
| USD | ||||
| Cost | ||||
| At December 1, 2024 | 105,206 | |||
| Currency translation differences | (4,254 | ) | ||
| At November 30, 2025/December 1, 2025 | 100,952 | |||
| Currency translation differences | (1,884 | ) | ||
| At 31 May 2026 | 99,068 | |||
| Accumulated depreciation | ||||
| At December 1, 2024 | 66,369 | |||
| Charged for the financial period | 19,029 | |||
| Currency translation differences | (3,471 | ) | ||
| At November 30, 2025/December 1, 2025 | 81,927 | |||
| Charged for the financial period | 6,822 | |||
| Currency translation differences | (1,089 | ) | ||
| At 31 May 2026 | 87,660 | |||
| Carrying amount | ||||
| Audited | ||||
| At November 30, 2025 | 19,025 | |||
| Unaudited | ||||
| At 31 May 2026 | 11,408 | |||
| Period ended | Year ended | |||||||
| May 31, 2026 | Nov 30, 2025 | |||||||
| Unaudited | Audited | |||||||
| USD | USD | |||||||
| Depreciation charge for financial period/year | 6,822 | 19,029 | ||||||
Note 6: Right-of-Use Assets
| USD | ||||
| Cost | ||||
| At December 1, 2024 | 595,918 | |||
| Addition | 15,446 | |||
| Lease modification | 119,844 | |||
| Written off | (56,455 | ) | ||
| Termination | (150,292 | ) | ||
| Currency translation differences | (21,136 | ) | ||
| At November 30, 2025/December 1, 2025 | 503,325 | |||
| Currency translation differences | (6,421 | ) | ||
| At 31 May 2026 | 496,904 | |||
| Accumulated depreciation | ||||
| At December 1, 2024 | 372,326 | |||
| Addition | 123,638 | |||
| Written off | (56,455 | ) | ||
| Termination | (81,408 | ) | ||
| Currency translation differences | (9,348 | ) | ||
| At November 30, 2025/December 1, 2025 | 348,753 | |||
| Addition | 48,786 | |||
| Currency translation differences | (4,763 | ) | ||
| At 31 May 2026 | 392,776 | |||
| Carrying amount | ||||
| Audited | ||||
| At November 30, 2025 | 154,572 | |||
| Unaudited | ||||
| At 31 May 2026 | 104,128 | |||
The Group leases buildings for their office, production and hostel for lease terms of between 1 to 5 years.
Note 7: Inventories
| As of | As of | |||||||
| May 31, | November 30, | |||||||
| 2026 | 2025 | |||||||
| Unaudited | Audited | |||||||
| USD | USD | |||||||
| At cost | ||||||||
| Merchandise and finished goods | 349,605 | 271,840 | ||||||
| Raw materials and supplies | 125,092 | 122,849 | ||||||
| 474,697 | 394,689 | |||||||
| Recognised as cost of sales | 188,567 | 402,903 | ||||||
Note 8: Trade receivables
Trade receivables are generally on 30 days term (2025: 30 days). They are recognised at their original invoice amounts which represent their fair values on initial recognition. Other credit terms are approved on a case-by-case basis.
The Group determines that a trade receivable is credit-impaired when the customer is experiencing significant financial difficulty and has defaulted in payments. Unless otherwise demonstrated, the Group generally considers a default to have occurred when the trade receivable is more than 90 days past due. The gross carrying amount of a credit-impaired trade receivable is directly written off when there is no reasonable expectation of recovery. This normally occurs when there is reasonable proof of customer insolvency.
The Group measures the loss allowance for trade receivables at an amount equal to lifetime expected credit losses using the simplified approach in accordance with IFRS 9. Such lifetime expected credit losses are calculated using a provision matrix based on historical observed default rates (adjusted for forward-looking estimates). The following table details the risk profile of trade receivables based on the Group’s provision matrix. As the Group’s historical credit loss experience does not show significantly different loss patterns for different customer segments, the loss allowance based on past due status is not further distinguished among the diversity of customer base.
The average credit loss rates were based on the payment profile of revenue over a period of 12 months and the corresponding historical credit losses experienced during the period. The rates were adjusted to reflect current and forward-looking information on macroeconomic factors affecting the ability of the customers to settle the receivables.
Trade receivables that are past due relate to a number of independent customers for whom there is no recent history of default.
| As of | As of | |||||||
| May 31, | November 30, | |||||||
| 2026 | 2025 | |||||||
| Unaudited | Audited | |||||||
| USD | USD | |||||||
| Trade receivables: | ||||||||
| Third parties | 215,639 | 27,536 | ||||||
| Related party | 65,940 | 247,117 | ||||||
| 281,579 | 274,653 | |||||||
| Less: Allowance for impairment losses | (248 | ) | (250 | ) | ||||
| 281,331 | 274,403 | |||||||
Note 8: Trade receivables (Cont’d)
The reconciliation of movements in the impairment loss of trade receivables is as follows:
| Period ended | Year ended | |||||||
| May 31, | November 30, | |||||||
| 2026 | 2025 | |||||||
| Unaudited | Audited | |||||||
| USD | USD | |||||||
| At beginning of financial period/year | 250 | 220 | ||||||
| Charge for the financial period/year | - | 261 | ||||||
| Reversal during the financial period/year | - | (220 | ) | |||||
| Currency translation differences | (2 | ) | (11 | ) | ||||
| At end of financial period/year | 248 | 250 | ||||||
The aged analysis of trade receivables as at the end of the reporting period:
| Gross amount | Loss allowance | Net amount | ||||||||||
| USD | USD | USD | ||||||||||
| Unaudited | ||||||||||||
| As of May 31, 2026 | ||||||||||||
| Not past due | ||||||||||||
| Current | 214,674 | - | 214,674 | |||||||||
| Past due | ||||||||||||
| 30 days | 13,947 | - | 13,947 | |||||||||
| 60 days | 4,449 | - | 4,449 | |||||||||
| More than 90 days | 48,509 | (248 | ) | 48,261 | ||||||||
| 281,579 | (248 | ) | 281,331 | |||||||||
| Audited | ||||||||||||
| As of November 30, 2025 | ||||||||||||
| Not past due | ||||||||||||
| Current | 188,042 | - | 188,042 | |||||||||
| Past due | ||||||||||||
| 30 days | 57,350 | - | 57,350 | |||||||||
| 60 days | 1,475 | - | 1,475 | |||||||||
| More than 90 days | 27,786 | (250 | ) | 27,536 | ||||||||
| 274,653 | (250 | ) | 274,403 | |||||||||
Note 9: Other Receivables
| Gross amount | Loss allowance | Net amount | ||||||||||||
| Note | USD | USD | USD | |||||||||||
| Unaudited | ||||||||||||||
| As of May 31, 2026 | ||||||||||||||
| Non-current | ||||||||||||||
| Long term loan receivable | - | - | - | |||||||||||
| Deposit | ||||||||||||||
| Guarantee deposit | 28,107 | - | 28,107 | |||||||||||
| Security deposit | 50,016 | - | 50,016 | |||||||||||
| Rental deposit | 19,773 | - | 19,773 | |||||||||||
| Prepayment | 6,336 | - | 6,336 | |||||||||||
| 104,232 | - | 104,232 | ||||||||||||
| Current | ||||||||||||||
| Other receivables | (a) | 1,248,254 | (150,916 | ) | 1,097,338 | |||||||||
| Consumption tax | 116,536 | - | 116,536 | |||||||||||
| Prepayment | 1,071,229 | - | 1,071,229 | |||||||||||
| 2,436,019 | (150,916 | ) | 2,285,103 | |||||||||||
| Total | 2,540,251 | (150,916 | ) | 2,389,335 | ||||||||||
| Audited | ||||||||||||||
| As of Nov 30, 2025 | ||||||||||||||
| Non-current | ||||||||||||||
| Long term loan receivable | 5,077 | - | 5,077 | |||||||||||
| Deposit | ||||||||||||||
| Guarantee deposit | 28,571 | - | 28,571 | |||||||||||
| Security deposit | 50,662 | - | 50,662 | |||||||||||
| Rental deposit | 20,029 | - | 20,029 | |||||||||||
| Prepayment | 7,234 | - | 7,234 | |||||||||||
| 111,573 | - | 111,573 | ||||||||||||
| Current | ||||||||||||||
| Other receivables | 546,635 | (169,669 | ) | 376,966 | ||||||||||
| Consumption tax | 7,410 | - | 7,410 | |||||||||||
| Prepayment | 707,412 | - | 707,412 | |||||||||||
| 1,261,457 | (169,669 | ) | 1,091,788 | |||||||||||
| Total | 1,373,030 | (169,669 | ) | 1,203,361 | ||||||||||
| · | Other receivables comprise mainly listing-related prepayments incurred in connection with the Group’s proposed listing on the Nasdaq Stock Market, including expenses relating to the business combination and listing exercise. These amounts are expected to be utilised or expensed upon completion of the relevant listing-related activities, subject to the nature of the underlying transactions and the applicable accounting requirements. |
Note 9: Other Receivables (Cont’d)
The reconciliation of movements in the impairment loss of other receivables is as follows:
| Period ended | Year ended | |||||||
| May 31, 2026 | Nov 30, 2025 | |||||||
| Unaudited | Audited | |||||||
| USD | USD | |||||||
| At beginning of financial period | 169,669 | 162,362 | ||||||
| Charge for the financial period | - | 14,470 | ||||||
| Currency translation difference | (18,753 | ) | (7,163 | ) | ||||
| At end of financial period | 150,916 | 169,669 | ||||||
Note 10: Invested share capital
Invested equity represents the aggregate capital contributions of the entities under common control, presented on a combined basis. During the previous financial year, the Group completed a capital reorganization. Consequently, invested equity was reclassified to a merger reserve.
| Number | Share Capital | Number of | Invested Equity | Total | ||||||||||||||||
| of shares | USD | shares | USD | USD | ||||||||||||||||
| Ordinary shares issued and paid up | ||||||||||||||||||||
| At December 1, 2024 | 500 | 66,828 | 118 | 15,772 | 82,600 | |||||||||||||||
| Changes in ownership interest in a combined entity | (500 | ) | (66,828 | ) | (118 | ) | (15,772 | ) | (82,600 | ) | ||||||||||
| Issuance of shares | 100,000,000 | 1,000 | - | - | 1,000 | |||||||||||||||
| Share repurchase | (77,950,000 | ) | (780 | ) | - | - | (780 | ) | ||||||||||||
| At November 30, 2025/May 31, 2026 | 22,050,000 | 220 | - | - | 220 | |||||||||||||||
Note 11: Merger Reserve
The merger reserve of USD82,600 represents the excess of the ISB Group’s net assets at the date of the reorganisation, recognised at predecessor carrying amounts, over the nominal consideration given. The merger reserve comprises the aggregate of:
(i) the equity of the ISB Subgroup (comprising ISB, AP, and Ras) as at December 1, 2021 being the beginning of the transition period, translated into USD at the applicable opening exchange rate, less the nominal share capital of the Company; and
(ii) The equity of Hiroki as at December 1, 2021, being the beginning of the transition period, translated into USD at the applicable opening exchange rate, included on the basis that Hiroki was under the Founder's common control throughout the relevant period.
The merger reserve is not distributable and does not form part of the Company's retained earnings or reserves available for dividend distribution.
Note 12: Lease liabilities
| As of | As of | |||||||
| May 31, 2026 | Nov 30, 2025 | |||||||
| Unaudited | Audited | |||||||
| USD | USD | |||||||
| Minimum lease payments | ||||||||
| Within one year | 99,250 | 118,227 | ||||||
| Later than one year and not later than two years | 52,604 | 88,225 | ||||||
| Later than two year and not later than five years | 27,687 | 29,338 | ||||||
| Later than five years | - | 12,410 | ||||||
| 179,541 | 248,200 | |||||||
| Less: Future finance charges | (7,088 | ) | (10,329 | ) | ||||
| Present value of minimum lease payments | 172,453 | 237,871 | ||||||
| Present value of minimum lease payments | ||||||||
| Within one year | 94,930 | 112,468 | ||||||
| Later than one year and not later than two years | 50,929 | 85,189 | ||||||
| Later than two year and not later than five years | 26,594 | 27,804 | ||||||
| Later than five years | - | 12,410 | ||||||
| 172,453 | 237,871 | |||||||
Note 13: Other payables
| As of | As of | |||||||
| May 31, 2026 | Nov 30, 2025 | |||||||
| Unaudited | Audited | |||||||
| USD | USD | |||||||
| Current | ||||||||
| Other payables | 1,279,700 | 380,865 | ||||||
| Accruals | 62,659 | 151,701 | ||||||
| Accrued consumption tax | 166,419 | 5,023 | ||||||
| Amount owing to directors | 239,334 | 150,048 | ||||||
| 1,748,112 | 687,637 | |||||||
Note 14: Revenue
Reportable segments
| Sales of regenerative medicine and stem cell cosmetics | Import of stem cells raw materials | Manufacturing of healthy foods, daily consumables | Sales and marketing | Total | ||||||||||||||||
| USD | USD | USD | USD | USD | ||||||||||||||||
| Unaudited | ||||||||||||||||||||
| 1.12.2025 to 31.5.2026 | ||||||||||||||||||||
| Japan | 1,122,337 | - | - | - | 1,122,337 | |||||||||||||||
| Hong Kong | 20,261 | - | - | - | 20,261 | |||||||||||||||
| 1,142,598 | - | - | - | 1,142,598 | ||||||||||||||||
| Unaudited | ||||||||||||||||||||
| 1.12.2024 to 31.5.2025 | ||||||||||||||||||||
| Japan | 1,031,782 | 13 | 7 | 52,246 | 1,084,048 | |||||||||||||||
| Indonesia | 7,002 | - | - | - | 7,002 | |||||||||||||||
| 1,038,784 | 13 | 7 | 52,246 | 1,091,050 | ||||||||||||||||
The timing of revenue recognition is at a point in time when the goods are delivered and accepted by customers.
Note 14: Revenue (Cont’d)
Concentration of revenue
The Group is principally engaged in the sale of cosmetic products. For the financial period May 31, 2026 and May 31, 2025, the Group derived a significant concentration of its revenue from two major customers, both located in Japan. The following customers individually accounted for 10% or more of the Group's total revenue for the year:
| Period ended | Period ended | |||||||||||||||
| May 31, 2026 | May 31, 2025 | |||||||||||||||
| Unaudited | Unaudited | |||||||||||||||
| USD | % | USD | % | |||||||||||||
| Customer A | 398,105 | 34.84 | % | 564,170 | 51.71 | % | ||||||||||
| Customer B | 80,135 | 7.01 | % | 104,382 | 9.57 | % | ||||||||||
| Customer C | 156,442 | 13.69 | % | 107,605 | 9.86 | % | ||||||||||
The three major customers collectively accounted for approximately 55.54% of the Group's total revenue for the financial period ended May 31, 2026 and 71.14% for the financial period ended May 31, 2025. Both customers operate as online retail platforms based in Japan and are third parties with whom the Group has maintained long-standing commercial relationships, cultivated over a number of years and supported by a consistent track record of product quality, timely delivery and collaborative brand development. The Directors consider these relationships to be stable and strategically important to the Group's continued growth in the Japanese market.
Whilst the Directors acknowledge the customer and geographic concentration risk this presents, they are actively managing and reducing this risk through the following strategic initiatives.
The Group has been engaged in original design manufacturing ("ODM") and original equipment manufacturing ("OEM") activities and continues to expand this capability by onboarding additional customers, deepening its integration across the Japanese market and diversifying its customer base beyond the two major platform customers.
The Group has made sustained investments in research and development to build a portfolio of owned proprietary skincare and cosmeceutical brands, strengthening product differentiation and supporting margin expansion. The Group markets its own brand product through its own direct-to-consumer online platform providing an independent channel to reach end consumers directly for brand positioning.
The Group is also actively pursuing expansion into international markets through collaboration with established local partners in selected target markets.
Note 15. Related Party Disclosures
| · | Identifying related parties |
For the purposes of these financial statements, parties are considered to be related to the Group or the Company if the Group or the Company has the ability, directly or indirectly, to control or joint control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where the Group or the Company and the party are subject to common control. Related parties may be individuals or other entities.
Related parties also include key management personnel defined as those persons having authority and responsibility for planning, directing and controlling the activities of the Group either directly or indirectly. The key management personnel comprise the directors and key management personnel of the Group, having authority and responsibility for planning, directing and controlling the activities of the Group entities directly or indirectly.
| · | Significant related party transactions |
Related party transactions have been entered into in the normal course of business under normal trade. In addition to the related party balances disclosed elsewhere in the financial statements, the significant related party transactions of the Group and the Company are as follows:
| Period ended | Period ended | |||||||
| May 31, 2026 | May 31, 2025 | |||||||
| Unaudited | Unaudited | |||||||
| USD | USD | |||||||
| Transactions with a related company: | ||||||||
| Sales | 35,451 | 38,534 | ||||||
Note 16. Financial Instruments
| · | Classification of financial instruments |
Financial assets and financial liabilities are measured on an ongoing basis either at fair value or at amortised cost. The principal accounting policies in Note 3 describe how the classes of financial instruments are measured, and how income and expense, including fair value gains and losses, are recognised.
Note 16. Financial Instruments (Cont’d)
| · | Classification of financial instruments (Cont’d) |
The following table analyses the financial assets and liabilities in the statements of financial position by the class of financial instruments to which they are assigned, and therefore by the measurement basis:
| As of | As of | |||||||
| May 31, 2026 | Nov 30, 2025 | |||||||
| Unaudited | Audited | |||||||
| USD | USD | |||||||
| At amortised cost | ||||||||
| Financial assets | ||||||||
| Trade receivables | 281,331 | 274,403 | ||||||
| Other receivables | 1,311,770 | 488,715 | ||||||
| Cash and bank balances | 25,565 | 124,764 | ||||||
| 1,618,666 | 887,882 | |||||||
| Financial liabilities | ||||||||
| Trade payables | 73,438 | 25,129 | ||||||
| Other payables | 1,748,112 | 687,637 | ||||||
| Lease liabilities | 172,453 | 237,871 | ||||||
| 1,994,003 | 950,637 | |||||||
| · | Financial risk management objectives and policies |
The Group standardised financial risk management policy is to ensure that adequate financial resources are available for the development of the Group whilst managing its financial risks, including credit risk, liquidity risk, foreign currency risk and interest risk. The Group operates within clearly defined guidelines that are approved by the Board and the Parent’s policy is not to engage in speculative transactions.
The following sections provide details regarding the Group’s exposure to the abovementioned financial risks and the objective, policies and processes for the management of these risks.
| · | Credit risk |
Financial assets that are primarily exposed to credit risks are trade and other receivables, inter-company balances and cash and bank balances.
Credit risk is the risk of a financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations. The Group’s exposure to credit risk arises principally from the inability of its customers to make payments when due.
The carrying amounts of the financial assets recorded on the consolidated statements financial position at the end of the reporting period represent the Group’s maximum exposure to credit risk.
Note 16. Financial Instruments (Cont’d)
| · | Financial risk management objectives and policies (Cont’d) |
| · | Credit risk (Cont’d) |
Concentration of credit risk
As at the reporting date, the Group’s top 3 customers accounted for approximately 64.67% of total trade receivables (November 30, 2025: 2 customers of 58.13%). The Group continuously monitors the creditworthiness of these customers and manages the associated credit risk through ongoing review of outstanding balances and collection performance.
While the Group has established relationships with these customers, any adverse changes in their financial position may have a material impact on the Group’s cash flows and financial position.
| · | Liquidity risk |
Liquidity risk refers to the risk that the Group and the Company will encounter difficulty in meeting its financial obligations as they fall due. The Group’s and the Company’s exposure to liquidity risk arises primarily from mismatches of the maturities of financial assets and liabilities.
The Group’s and the Company’s funding requirements and liquidity risk are managed with the objective of meeting business obligations on a timely basis. The Group and the Company finance its liquidity through internally generated cash flows.
Note 16. Financial Instruments (Cont’d)
| · | Financial risk management objectives and policies (Cont’d) |
| · | Liquidity risk (Cont’d) |
Analysis of financial instruments by remaining contractual maturities
The table below summarises the maturity profile of the Group’s and the Company’s financial liabilities at the end of the reporting period based on undiscounted contractual payments:
| Weighted average effective interest rate | Total carrying amount | On demand or within 1 year | 2 to 5 years | More than 5 years | Total undiscounted cash flow | |||||||||||||||||||
| % | USD | USD | USD | USD | USD | |||||||||||||||||||
| Unaudited | ||||||||||||||||||||||||
| As of May 31, 2026 | ||||||||||||||||||||||||
| Non-interest bearing: | ||||||||||||||||||||||||
| Trade payables | - | 73,438 | 73,438 | - | - | 73,438 | ||||||||||||||||||
| Other payables | - | 1,508,778 | 1,508,778 | - | - | 1,508,778 | ||||||||||||||||||
| Amount due to directors | - | 49,868 | 49,868 | - | - | 49,868 | ||||||||||||||||||
| 1,632,084 | 1,632,084 | - | - | 1,632,084 | ||||||||||||||||||||
| Interest bearing: | ||||||||||||||||||||||||
| Lease liabilities | 1.1 - 7.0 | 172,453 | 99,250 | 80,291 | - | 179,541 | ||||||||||||||||||
| Amount due to directors | 1.1 | 189,466 | 208,413 | - | - | 208,413 | ||||||||||||||||||
| 361,919 | 307,663 | 80,291 | - | 387,954 | ||||||||||||||||||||
| 1,994,003 | 1,939,747 | 80,291 | - | 2,020,038 | ||||||||||||||||||||
Note 16. Financial Instruments (Cont’d)
| · | Financial risk management objectives and policies (Cont’d) |
| · | Liquidity risk (Cont’d) |
Analysis of financial instruments by remaining contractual maturities (Cont’d)
The table below summarises the maturity profile of the Group’s and the Company’s financial liabilities at the end of the reporting period based on undiscounted contractual payments: (Cont’d)
| Weighted average effective interest rate | Total carrying amount | On demand or within 1 year | 2 to 5 years | More than 5 years | Total undiscounted cash flow | |||||||||||||||||||
| % | USD | USD | USD | USD | USD | |||||||||||||||||||
| Audited | ||||||||||||||||||||||||
| As of November 30, 2025 | ||||||||||||||||||||||||
| Non-interest bearing: | ||||||||||||||||||||||||
| Trade payables | - | 25,129 | 25,129 | - | - | 25,129 | ||||||||||||||||||
| Other payables | - | 537,588 | 537,588 | - | - | 537,588 | ||||||||||||||||||
| Amount due to directors | - | 22,105 | 22,105 | - | - | 22,105 | ||||||||||||||||||
| 584,822 | 584,822 | - | - | 584,822 | ||||||||||||||||||||
| Interest bearing: | ||||||||||||||||||||||||
| Lease liabilities | 1.1 – 7.0 | 237,871 | 118,227 | 117,563 | 12,410 | 248,200 | ||||||||||||||||||
| Amount due to directors | 1.1 | 127,943 | 129,350 | - | - | 129,350 | ||||||||||||||||||
| 365,814 | 247,577 | 117,563 | 12,410 | 377,550 | ||||||||||||||||||||
| 950,636 | 832,399 | 117,563 | 12,410 | 962,372 | ||||||||||||||||||||
Note 16. Financial Instruments (Cont’d)
b. Financial risk management objectives and policies (Cont’d)
| · | Foreign currency risk |
All operating entities of the Group are incorporated and domiciled in Japan, with Japanese Yen (“JPY”) as their functional currency. The Group’s results, financial assets and liabilities are predominantly denominated in JPY and, accordingly, the Group has minimal exposure to foreign currency risk arising from transactions denominated in currencies other than JPY.
The Group is, however, exposed to foreign currency risk arising from the translation of its foreign operations into the Group’s presentation currency. Accordingly, the Group is subject to translation risk arising from movements in the JPY/USD exchange rate. A weakening of JPY against USD would reduce the USD value of the Group’s net assets and earnings when translated for consolidation purposes.
Exchange differences arising on translation are recognised in other comprehensive income and accumulated in the foreign currency translation reserve within equity. These translation differences are not reclassified to profit or loss on disposal of the foreign operations.
| · | Interest rate risk |
The Group’s exposure to interest rate risk arises mainly from interest-bearing financial instruments, namely a loan from a director and lease liabilities. These instruments bear interest at fixed rates and, accordingly, the Group is not exposed to significant cash flow interest rate risk.
As the Group does not account for its fixed rate financial instruments at fair value through profit or loss, any change in interest rates at the end of the reporting period would not affect its profit or loss (and equity). No disclosure of sensitivity analysis is presented as there is no floating rate instrument outstanding as at end of the financial period/year.
| · | Fair values of financial instruments |
The carrying amounts of short-term payables and cash and cash equivalents approximate their fair value due to the relatively short-term nature of these financial instruments and insignificant impact of discounting.
| · | Policy on transfer between levels |
The fair value of an asset to be transferred between levels is determined as of the date of the event or change in circumstances that caused the transfer. There were no transfers between levels during current and previous financial period.
Note 16. Financial Instruments (Cont’d)
| · | Fair values of financial instruments (Cont’d) |
| · | Level 1 fair value |
Level 1 fair value is derived from quoted prices (unadjusted) in active markets for identical assets or liabilities.
| · | Level 2 fair value |
Level 2 fair value is estimated using inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
| · | Level 3 fair value |
Level 3 fair values for the financial assets and liabilities are estimated using unobservable inputs.
Note 17. Subsequent Events
Subsequent to the end of the reporting period, on 23 July 2026, Instinct Bio Technical Company Holdings Inc. (formerly known as Relativity Holdings Inc.) completed its business combination with Relativity Acquisition Corp. and acquired all the issued and outstanding equity interests of Instinct Bio Technical Company Inc. in exchange for newly issued ordinary shares of Instinct Bio Technical Company Holdings Inc., with an aggregate equity consideration of approximately US$225 million.
Following the completion of the business combination, Instinct Bio Technical Company Holdings Inc. became the publicly listed parent company, and Instinct Bio Technical Company Inc. became its indirect wholly-owned subsidiary. The ordinary shares and warrants of Instinct Bio Technical Company Holdings Inc. commenced trading on the Nasdaq Stock Market on 24 July 2026 under the ticker symbols “BIOT” and “BIOTW”, respectively.
The business combination and subsequent listing occurred after the reporting period and, accordingly, have not been reflected in the financial statements for the current reporting period. The financial effects of the transaction, where applicable, will be recognised in the subsequent financial reporting period.
Exhibit 99.2
Management's Discussion and Analysis of Financial Condition and Results of Operations
For the six months ended May 31, 2026 (first half of the fiscal year ending November 30, 2026)
The following discussion should be read together with the unaudited condensed consolidated interim financial statements of Instinct Bio Technical Company Inc. ("BIOT" or the "Company") and its subsidiaries (together, the "Group") for the six months ended May 31, 2026 and the related notes, which are furnished with this report on Form 6-K. It should also be read with the Group's audited consolidated financial statements for the year ended November 30, 2025, included as Exhibit 18.3 to the shell company report on Form 20-F filed by Instinct Bio Technical Company Holdings Inc. (formerly known as Relativity Holdings Inc.) on July 29, 2026. On July 23, 2026, after the end of the period, BIOT became a wholly owned subsidiary of Instinct Bio Technical Company Holdings Inc. upon completion of the business combination with Relativity Acquisition Corp.
Basis of presentation
| · | The financial statements are prepared in accordance with IAS 34 Interim Financial Reporting as issued by the IASB. They are presented in U.S. dollars ("USD"); the functional currency of the operating subsidiaries is the Japanese yen ("JPY"). |
| · | The financial statements are unaudited and have been reviewed by Morison LC PLT. |
| · | The Group was formed through a reorganization of entities under common control in 2025. It is presented under the predecessor cost method as if it had always existed in its current structure, so the comparative period reflects the combined results of the four Japanese operating subsidiaries. |
| · | The statement of financial position is compared with November 30, 2025 (audited). Results and cash flows are compared with the six months ended May 31, 2025. |
| · | Income and expenses are translated at average rates (approximately JPY 157.3 per USD in the current period and JPY 150.0 per USD in the comparative period). Balance sheet items are translated at period-end rates (JPY 158 per USD at May 31, 2026 and approximately JPY 156 per USD at November 30, 2025). |
| · | Business-line revenue is derived from the Group's management records in JPY and translated at the average rate for each period. It reconciles to total reported revenue. |
Cautionary statement regarding forward-looking statements
This discussion contains forward-looking statements, including statements about our expectations for revenue, margins, liquidity, the settlement of intercompany balances and our business strategy. Words such as "expect", "intend", "plan", "believe", "may" and similar expressions identify these statements. They are based on management's current expectations and are subject to risks and uncertainties, including those described under "Known Trends, Uncertainties and Risks" below. Actual results may differ materially. We undertake no obligation to update any forward-looking statement, except as required by law.
Overview
BIOT is a Cayman Islands holding company. It conducts all of its operations in Japan through four wholly owned subsidiaries, which develop, manufacture and sell stem-cell-based and regenerative-medicine-related cosmetics and health products.
| Subsidiary | Principal activity |
| Instinct Brothers Co., Ltd. ("ISB") | Sales to OEM/ODM customers, direct-to-consumer e-commerce and export |
| Hiroki Global Co., Ltd. ("Hiroki") | Import of stem cell raw materials and procurement of materials for products supplied to ISB |
| Artisan Production Co., Ltd. ("AP") | Our group's cosmetics factory in Kakegawa City, Shizuoka Prefecture, where ISB outsources manufacturing |
| Instinct RAS Co., Ltd. ("RAS") | Former e-commerce channel; no revenue in the current period |
We report revenue across five business lines: OEM/ODM, Value Village (our direct-to-consumer e-commerce brand), Genrever Clinic support, Value Athlete (sports-related products) and Overseas.
First-half highlights
| · | Revenue was USD 1,142,598, up 4.7% from USD 1,091,050. In yen terms, revenue grew 9.8%. A weaker yen reduced reported USD revenue by approximately USD 55,000. |
| · | Gross margin was 72.6%, down from 79.7%, mainly because of a smaller inventory build, new imported purchases and higher manufacturing overhead. |
| · | Administrative expenses fell 30.1% to USD 741,691. The decrease reflects the absence of listing-related professional fees, which were expensed by the operating subsidiaries in the comparative period. |
| · | Profit after tax was USD 90,251, compared with a loss of USD 206,817 in the comparative period. |
| · | Net cash used in operating activities was USD 12,323, compared with USD 371,404 in the comparative period, as profit was more than absorbed by an increase in other receivables and prepayments. Cash and bank balances were USD 25,565 at May 31, 2026, compared with USD 124,764 at November 30, 2025. |
Results of Operations
The following table summarizes our unaudited consolidated results for the six months ended May 31, 2026 and 2025.
| (USD) | Six months ended May 31, 2026 | Six months ended May 31, 2025 | Change | Change (%) | ||||||||||||
| Revenue | 1,142,598 | 1,091,050 | 51,548 | 4.7 | % | |||||||||||
| Cost of sales | (313,608 | ) | (221,729 | ) | (91,879 | ) | 41.4 | % | ||||||||
| Gross profit | 828,990 | 869,321 | (40,331 | ) | (4.6 | )% | ||||||||||
| Gross margin | 72.6 | % | 79.7 | % | (7.1 | ) pts | — | |||||||||
| Other income | 6,291 | 6,472 | (181 | ) | (2.8 | )% | ||||||||||
| Net impairment loss on financial assets | — | (13,484 | ) | 13,484 | — | |||||||||||
| Administrative expenses | (741,691 | ) | (1,060,969 | ) | 319,278 | (30.1 | )% | |||||||||
| Finance costs | (3,314 | ) | (8,117 | ) | 4,803 | (59.2 | )% | |||||||||
| Profit/(loss) before taxation | 90,276 | (206,777 | ) | 297,053 | — | |||||||||||
| Taxation | (25 | ) | (40 | ) | 15 | — | ||||||||||
| Profit/(loss) after tax | 90,251 | (206,817 | ) | 297,068 | — | |||||||||||
| Exchange translation differences (OCI) | (46,659 | ) | 88,213 | (134,872 | ) | — | ||||||||||
| Total comprehensive income/(loss) | 43,592 | (118,604 | ) | 162,196 | — | |||||||||||
| Basic earnings/(loss) per share | 0.00 | (0.01 | ) | — | — | |||||||||||
Revenue
Revenue increased by USD 51,548, or 4.7%, to USD 1,142,598. In JPY, revenue increased by 9.8%, from JPY 163.7 million to JPY 179.8 million. The yen weakened from an average of approximately JPY 150.0 to JPY 157.3 per USD, which reduced reported USD revenue by approximately USD 55,000. All revenue is recognized at a point in time when goods are delivered to and accepted by customers.
Revenue by business line
| (USD) | Six months ended May 31, 2026 | % of total | Six months ended May 31, 2025 | Change (USD) | Change in JPY terms (%) | |||||||||||
| OEM/ODM | 952,745 | 83.4 | % | 938,171 | 14,574 | 6.5 | % | |||||||||
| Value Village (D2C e-commerce) | 110,918 | 9.7 | % | 103,638 | 7,280 | 12.2 | % | |||||||||
| Genrever Clinic support | 35,451 | 3.1 | % | 38,511 | (3,060 | ) | (3.5 | )% | ||||||||
| Value Athlete | 23,223 | 2.0 | % | 3,732 | 19,491 | 552.4 | % | |||||||||
| Overseas | 20,261 | 1.8 | % | 6,998 | 13,263 | 203.6 | % | |||||||||
| Total | 1,142,598 | 100.0 | % | 1,091,050 | 51,548 | 9.8 | % | |||||||||
Business-line amounts are translated from JPY management records at average rates and reconcile to total revenue. The comparative Value Village figure includes e-commerce revenue recorded by RAS.
| · | OEM/ODM revenue grew 6.5% in JPY terms. Higher orders from two existing customers (up USD 93,808 and USD 48,899) and new customers more than offset lower orders from our largest customer (down USD 165,503). The two largest new customers contributed USD 44,616 and USD 21,612. |
| · | Value Village revenue grew 12.2% in JPY terms. All e-commerce sales are now processed by ISB through Shopify; in the comparative period part of these sales was recorded by RAS. |
| · | Genrever Clinic support revenue consists of products and services supplied to a company wholly owned by our founder for the Genrever clinic business. It decreased 3.5% in JPY terms. |
| · | Value Athlete revenue rose to USD 23,223, driven by a JPY 2.0 million order from a functional food manufacturer and sales to youth football clubs in western Japan. |
| · | Overseas revenue in the current period was a single export order to a trading company in Hong Kong. The comparative period included one export order to a customer in Indonesia. |
Customer concentration
Our ten largest customers accounted for approximately 90% of revenue in both periods. Our largest customer accounted for 34.8% of revenue, down from 51.7%, as the customer base broadened. The table below shows customers that accounted for more than 5% of revenue in either period.
| (USD) | Six months ended May 31, 2026 | % of revenue | Six months ended May 31, 2025 | % of revenue | ||||||||||||
| Customer A (OEM/ODM) | 398,105 | 34.8 | % | 564,170 | 51.7 | % | ||||||||||
| Customer C (OEM/ODM) | 156,442 | 13.7 | % | 107,605 | 9.9 | % | ||||||||||
| Value Village (D2C e-commerce) | 110,918 | 9.7 | % | 102,032 | 9.4 | % | ||||||||||
| Customer D (OEM/ODM) | 109,458 | 9.6 | % | 15,650 | 1.4 | % | ||||||||||
| Customer B (OEM/ODM) | 80,135 | 7.0 | % | 104,382 | 9.6 | % | ||||||||||
Cost of sales and gross profit
Cost of sales increased by USD 91,879, or 41.4%, to USD 313,608. Gross profit decreased by USD 40,331, or 4.6%, to USD 828,990, and gross margin declined from 79.7% to 72.6%. Higher revenue would have added approximately USD 81,000 of gross profit at the prior-period margin; the lower margin more than offset this. The main drivers were:
| · | Smaller inventory build: ISB increased inventories by a smaller amount than in the comparative period, which reduced the benefit to cost of sales by approximately JPY 5.6 million (USD 35,000). |
| · | Higher manufacturing overhead at AP: depreciation of production equipment and outbound freight increased as production volumes rose. |
| · | New imported purchases: ISB began purchasing finished goods from a supplier in China, adding approximately JPY 3.4 million (USD 22,000). |
| · | Higher material and merchandise purchases: AP's material costs and Hiroki's imports of stem cell raw materials rose with volumes. |
These increases were partly offset by lower labor costs at AP, as the comparative period included a bonus payment.
Administrative expenses
Administrative expenses decreased by USD 319,278, or 30.1%, to USD 741,691. As a percentage of revenue, they fell from 97.2% to 64.9%.
| · | Listing-related professional fees: in the comparative period, the operating subsidiaries expensed approximately JPY 31.3 million (USD 208,000) of professional fees related to the Company's proposed Nasdaq listing. No such fees were expensed by the operating subsidiaries in the current period. |
| · | Directors' remuneration: decreased by JPY 4.6 million following a revision of compensation at ISB. |
| · | Premises and leases: rent, lease and consumables expenses decreased by approximately JPY 8.6 million, mainly due to the closure of the Harajuku premises and the end of an equipment lease. |
| · | Sales promotion: increased by approximately JPY 3.2 million, mainly at Hiroki. |
| · | Depreciation: total depreciation of property, plant and equipment, intangible assets and right-of-use assets was USD 90,824, compared with USD 119,043. |
Other income, impairment and finance costs
Other income was broadly flat at USD 6,291. No impairment loss on financial assets was recognized in the current period, compared with USD 13,484 in the comparative period. Finance costs decreased by USD 4,803 to USD 3,314 and consist of interest on lease liabilities.
Taxation
The tax charge was USD 25, compared with USD 40, and consists of minimum local inhabitant taxes. The subsidiaries have tax losses available to offset taxable profits. We will reassess the full-year tax charge at year end.
Profit and total comprehensive income
As a result of the above, profit after tax was USD 90,251, compared with a loss of USD 206,817. Exchange differences on translating the subsidiaries' JPY net assets into USD resulted in an other comprehensive loss of USD 46,659, compared with a gain of USD 88,213. Total comprehensive income was USD 43,592, compared with a total comprehensive loss of USD 118,604.
Financial Position
Total assets were USD 4,080,414 at May 31, 2026, compared with USD 2,994,989 at November 30, 2025. The increase of USD 1,085,425 was driven mainly by other receivables and prepayments. Total liabilities increased to USD 1,994,227 from USD 952,394, mainly due to higher other payables. Equity increased to USD 2,086,187 from USD 2,042,595, reflecting total comprehensive income of USD 43,592 for the period.
| (USD) | May 31, 2026 | November 30, 2025 | Change | |||||||||
| Property, plant and equipment | 775,634 | 809,211 | (33,577 | ) | ||||||||
| Intangible and right-of-use assets | 115,536 | 173,597 | (58,061 | ) | ||||||||
| Non-current other receivables | 104,232 | 111,573 | (7,341 | ) | ||||||||
| Inventories | 474,697 | 394,689 | 80,008 | |||||||||
| Trade receivables | 281,331 | 274,403 | 6,928 | |||||||||
| Other receivables (current) | 2,285,103 | 1,091,788 | 1,193,315 | |||||||||
| Tax recoverable | 18,316 | 14,964 | 3,352 | |||||||||
| Cash and bank balances | 25,565 | 124,764 | (99,199 | ) | ||||||||
| Total assets | 4,080,414 | 2,994,989 | 1,085,425 | |||||||||
| Trade payables | 73,438 | 25,129 | 48,309 | |||||||||
| Other payables | 1,748,112 | 687,637 | 1,060,475 | |||||||||
| Lease liabilities | 172,453 | 237,871 | (65,418 | ) | ||||||||
| Taxation | 224 | 1,757 | (1,533 | ) | ||||||||
| Total liabilities | 1,994,227 | 952,394 | 1,041,833 | |||||||||
| Total equity | 2,086,187 | 2,042,595 | 43,592 | |||||||||
| · | Other receivables (current) comprised other receivables of USD 1,097,338 (net of a loss allowance of USD 150,916), prepaid expenses of USD 1,071,229 and consumption tax receivable of USD 116,536. At November 30, 2025, these were USD 376,966, USD 707,412 and USD 7,410. Other receivables include advances and loans to related parties and individuals. |
| · | Trade receivables were USD 281,331, compared with USD 274,403. USD 214,674 was not past due and USD 48,509 was more than 90 days past due. The loss allowance was USD 248. |
| · | Other payables increased by USD 1,060,475. They include borrowings from directors and related parties and amounts payable for listing-related services. |
| · | Lease liabilities decreased by USD 65,418 as lease payments continued and no new leases were entered into. |
| · | Equity increased by USD 43,592: profit of USD 90,251 was partly offset by a translation loss of USD 46,659 as the yen weakened, which increased the deficit in the foreign currency translation reserve to USD 964,864. |
Liquidity and Capital Resources
At May 31, 2026, we had cash and bank balances of USD 25,565, compared with USD 124,764 at November 30, 2025. We have no borrowings from financial institutions. We manage liquidity with the objective of meeting our obligations as they fall due. We fund our operations through cash generated from our operating activities, including the collection of trade and other receivables, supplemented as needed by loans from our directors and related parties.
Cash flows
| (USD) | Six months ended May 31, 2026 | Six months ended May 31, 2025 | ||||||
| Net cash generated from/(used in) operating activities | (12,323 | ) | (371,404 | ) | ||||
| Net cash used in investing activities | (11,813 | ) | (20,850 | ) | ||||
| Net cash used in financing activities | (74,104 | ) | (71,677 | ) | ||||
| Effect of exchange rate fluctuations | (959 | ) | 46,361 | |||||
| Cash and cash equivalents at beginning of period | 124,764 | 512,446 | ||||||
| Cash and cash equivalents at end of period | 25,565 | 94,876 | ||||||
Operating activities. Net cash used in operating activities was USD 12,323, compared with USD 371,404 in the comparative period. Profit before taxation of USD 90,276, adjusted for depreciation and amortization, was more than absorbed by working capital. Other receivables increased by approximately USD 1.17 million, mainly prepayments and advances, largely offset by an increase in other payables of approximately USD 1.06 million. Inventories increased by approximately USD 80,000, and we paid income taxes of USD 22,518.
Investing activities. Net cash used in investing activities was USD 11,813, all for purchases of production machinery and computer equipment, compared with USD 20,850 in the comparative period.
Financing activities. Net cash used in financing activities was USD 74,104, consisting of lease payments, including interest of USD 3,314, compared with USD 71,677 in the comparative period (lease payments of USD 70,599 and lease interest of USD 1,078).
Working capital and going concern
At May 31, 2026, current assets were USD 3,085,012 and current liabilities were USD 1,916,704. However, a large part of current assets consists of other receivables and prepayments, which will not convert into cash in the near term. Our ability to meet obligations as they fall due depends on:
| · | collecting trade and other receivables, including amounts due from related parties; |
| · | continued financial support from our directors and related parties; and |
| · | obtaining additional financing as needed. |
The directors have reviewed the Group's financial projections, cash flow forecasts and available financing, including continued support from our directors and related parties, for a period of not less than twelve months from the date of approval of the financial statements. Having performed this assessment, the directors are satisfied that the Group has adequate resources to continue as a going concern for the foreseeable future, and the financial statements have been prepared on a going concern basis. There can be no assurance that additional financing will be available on acceptable terms.
Critical Accounting Policies and Estimates
Our material accounting policies are described in Note 3 to the financial statements. The estimates below involve the most significant judgment.
| · | Expected credit losses on trade and other receivables. We measure trade receivables using a provision matrix based on historical loss rates adjusted for forward-looking information. Other receivables include significant balances with related parties and individuals, against which we hold a loss allowance of USD 150,916. Changes in these counterparties' ability to pay could require additional allowances. |
| · | Inventories. Inventories are stated at the lower of weighted-average cost and net realizable value. Management assesses slow-moving and obsolete items at each reporting date. |
| · | Useful lives of property, plant and equipment. Buildings are depreciated over 15 to 20 years, machinery over 10 years, motor vehicles over 6 years and computers over 4 to 5 years. Changes in these estimates would affect depreciation expense. |
| · | Leases. Right-of-use assets and lease liabilities for office, production and staff housing premises depend on the lease term and discount rate applied. |
| · | Common control reorganization. The Group applies the predecessor cost method. No goodwill or fair value adjustments were recognized, and comparative information is presented as if the current structure had always existed. |
| · | Going concern. The going concern assessment is based on the directors' review of financial projections, cash flow forecasts and available financing, including the collection of receivables and continued support from our directors and related parties, as described under "Liquidity and Capital Resources". |
Known Trends, Uncertainties and Risks
The following trends and uncertainties are reasonably likely to affect our future results and financial condition.
| · | Customer concentration. Our ten largest customers accounted for approximately 90% of revenue, and our largest customer alone for 34.8%. Revenue from our largest customer decreased 26% in JPY terms in the period. A reduction in orders from a major customer would have a significant effect on revenue. |
| · | Gross margin. Our gross margin declined to 72.6%. Margins are affected by product mix, purchases of imported goods and the level of production at our Kakegawa plant. |
| · | Foreign exchange. Our revenue and costs are denominated in JPY, while we report in USD. A weaker yen reduces reported revenue and profit and creates translation losses in other comprehensive income. Imported raw materials and products also become more expensive when the yen weakens. |
| · | Liquidity. Our cash balance is low relative to current liabilities. In addition to cash generated from operating activities, we depend on collecting receivables, including from related parties, and on financial support from our directors and related parties. |
| · | Listing-related costs. We expect to continue incurring significant professional fees in connection with our public company reporting obligations. |
| · | E-commerce channel. We consolidated our e-commerce sales into ISB. RAS recorded no revenue in the period, and we are evaluating its future role within the Group. |
Exhibit 99.3
Instinct Bio Returns to Profit and Grows Revenue Nearly 10% in Yen Terms in First Half of Fiscal 2026
TOKYO, October 16, 2026 -- Instinct Bio Technical Company Holdings Inc. (Nasdaq: BIOT) ("BIOT" or the "Company"), a Japan-based developer, manufacturer and seller of stem-cell-based and regenerative-medicine-related cosmetics and health products, today announced unaudited results for the six months ended May 31, 2026 ("1H FY2026") of Instinct Bio Technical Company Inc. and its four Japanese operating subsidiaries (the "Operating Group"), which became wholly owned subsidiaries of the Company on July 23, 2026. The interim financial statements, reviewed by Morison LC PLT, and management's discussion and analysis are furnished to the SEC on Form 6-K today. Results exclude the Company's predecessor, Relativity Holdings Inc., and business combination costs. Comparisons are with the six months ended May 31, 2025.
1H FY2026 Highlights
| · | Revenue of USD 1,142,598, up 4.7% (up 9.8% in yen terms, from JPY 163.7 million to JPY 179.8 million). |
| · | OEM/ODM revenue (83.4% of total) up 6.5% and Value Village e-commerce revenue up 12.2%, both in yen terms. |
| · | Gross margin of 72.6% (1H FY2025: 79.7%), reflecting a smaller inventory build, new imported purchases and higher manufacturing overhead. |
| · | Administrative expenses down 30.1% to USD 741,691, mainly as approximately USD 208,000 of listing-related fees expensed in 1H FY2025 did not recur. |
| · | Profit after tax of USD 90,251 (1H FY2025: loss of USD 206,817). |
| · | Largest customer's share of revenue fell to 34.8% from 51.7% as new OEM/ODM, export and Value Athlete customers were added. |
| · | Net cash used in operating activities of USD 12,323 (1H FY2025: USD 371,404). Cash of USD 25,565 at May 31, 2026; no bank borrowings. |
Management Commentary
"This is the first set of results we have reported since completing our Nasdaq listing in July. Until now, investors have had little visibility into who we are as a management team and what our business actually does. We chose to report our first half now, and will continue to report every six months, so that shareholders can judge us on facts: revenue grew almost 10% in yen terms, we returned to profit, and our customer base is broader than a year ago. We are not satisfied with our gross margin or cash position, and improving both is our priority for the second half," said Tomoki Nagano, Chairman and Chief Executive Officer.
"Each of the initiatives we announced since July -- our U.S. collaboration with INVITRX, our Indonesian product partnership, the GENRÊVER Clinic in Jakarta and our IN01 representation -- is progressing on schedule. Our target is to have them operational by the end of calendar 2026, with revenue contribution beginning in fiscal 2027."
Financial Position and Liquidity
At May 31, 2026, total assets were USD 4,080,414, total liabilities USD 1,994,227 and total equity USD 2,086,187. The increases from November 30, 2025 were driven mainly by other receivables and prepayments, including advances to related parties, and by other payables, including borrowings from directors and related parties. Cash and bank balances were USD 25,565 (November 30, 2025: USD 124,764). The Operating Group's liquidity depends on collecting receivables, including from related parties, continued support from directors and related parties, and obtaining additional financing as needed. The directors have concluded that the Operating Group has adequate resources to continue as a going concern for at least twelve months. See "Liquidity and Capital Resources" in the Form 6-K.
Overseas Initiatives
The following initiatives, announced between July and September 2026, did not contribute to 1H FY2026 revenue. All are targeted to be operational within calendar 2026, with revenue contribution expected from fiscal 2027, subject to definitive agreements, regulatory approvals and partner performance.
| · | United States: GENRÊVER-branded cosmetics to be manufactured by INVITRX at its U.S. GMP facility for the U.S. market |
| · | Indonesia: first two cosmetic products with PT Parva Candela Kosmetick |
| · | Jakarta: membership-based GENRÊVER Clinic, targeted to open in December 2026 |
| · | IN01: non-exclusive representation of CelSiege BioSciences' cancer immunotherapy program in Japan and China |
Summary of Unaudited Results of the Operating Group
| (USD) | 1H FY2026 | 1H FY2025 | Change | |||||||||
| Revenue | 1,142,598 | 1,091,050 | +4.7 | % | ||||||||
| Gross profit | 828,990 | 869,321 | (4.6 | )% | ||||||||
| Gross margin | 72.6 | % | 79.7 | % | (7.1 | ) pts | ||||||
| Administrative expenses | (741,691 | ) | (1,060,969 | ) | (30.1 | )% | ||||||
| Profit/(loss) after tax | 90,251 | (206,817 | ) | n.m. | ||||||||
| Total comprehensive income/(loss) | 43,592 | (118,604 | ) | n.m. | ||||||||
| Net cash used in operating activities | (12,323 | ) | (371,404 | ) | n.m. | |||||||
| Revenue by business line (USD) | 1H FY2026 | 1H FY2025 | Change (JPY) | |||||||||
| OEM/ODM | 952,745 | 938,171 | +6.5 | % | ||||||||
| Value Village (D2C e-commerce) | 110,918 | 103,638 | +12.2 | % | ||||||||
| Genrever Clinic support | 35,451 | 38,511 | (3.5 | )% | ||||||||
| Value Athlete | 23,223 | 3,732 | +552.4 | % | ||||||||
| Overseas | 20,261 | 6,998 | +203.6 | % | ||||||||
| Total | 1,142,598 | 1,091,050 | +9.8 | % | ||||||||
| (USD) | May 31, 2026 | Nov 30, 2025 | ||||||
| Cash and bank balances | 25,565 | 124,764 | ||||||
| Total assets | 4,080,414 | 2,994,989 | ||||||
| Total liabilities | 1,994,227 | 952,394 | ||||||
| Total equity | 2,086,187 | 2,042,595 | ||||||
Yen amounts translated at average rates of approximately JPY 157.3 (1H FY2026) and JPY 150.0 (1H FY2025) per U.S. dollar. Full financial statements and MD&A are in the Company's Form 6-K furnished on October 16, 2026, available at www.sec.gov.
About Instinct Bio Technical Company Holdings Inc.
Instinct Bio Technical Company Holdings Inc. (Nasdaq: BIOT), headquartered in Tokyo, develops, manufactures and sells stem-cell-based and regenerative-medicine-related cosmetics and health products through its wholly owned subsidiaries in Japan. Learn more at https://instinct-biot.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements regarding growth, gross margin, liquidity, customer diversification and the timing and contribution of overseas initiatives. These statements are based on current expectations and are subject to risks that could cause actual results to differ materially, including customer concentration, gross margin pressure, yen/U.S. dollar exchange rates, the Company's limited cash resources and dependence on related-party support and additional financing, its ability to regain and maintain compliance with Nasdaq continued listing requirements, and overseas regulatory approvals and partner performance, as described in the Company's SEC filings, including its shell company report on Form 20-F filed July 29, 2026. The Company undertakes no obligation to update these statements, except as required by law.
Investor Relations Contact
Instinct Bio Technical
Company Holdings Inc.
Email: ir@instinct-bro.com
Website: https://instinct-biot.com/