Artelo Biosciences Limited

	Page
Balance Sheet	1
Notes to the Financial Statements	2—4

1. General Information

Artelo Biosciences Limited is a private company, limited by shares, incorporated in England & Wales, registered number 10800659 . The registered office is Mereside, Alderley Park, Alderley Edge, Cheshire, SK10 4TG.

2. Accounting Policies

2.1. Basis of Preparation of Financial Statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" including the provisions of section 1a "Small Entities" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

The financial statements are presented in sterling which is the functional currency of the company and rounded to the nearest £.

The significant accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all years presented unless otherwise stated.

2.2. Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Profit and Loss Account, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

2.3. Pensions

The company operates a defined contribution pension scheme. Contributions are charged to the profit and loss account as they become payable in accordance with the rules of the scheme.

2.4. Debtors and creditors receivable / payable within one year

Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the profit and loss account in other administrative expenses.

2.5. Leases

Rentals payable and receivable under operating leases are charged to the profit and loss account on a straight line basis over the period of the lease.

2.6. Research and Development

Expenditure on research and development is written off in the year in which it is incurred.

3. Average Number of Employees

Average number of employees, including directors, during the year was: 7 (2023: 7)

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Artelo Biosciences Limited

Notes to the Financial Statements (continued)

For The Year Ended 31 December 2024

4. Debtors

	2024	2023
	£	£
Due within one year
Prepayments and accrued income	17,181	25,991
Other debtors	80,000	238,123
VAT	41,967	89,500

	139,148	353,614

5. Creditors: Amounts Falling Due Within One Year

	2024	2023
	£	£
Trade creditors	237,088	519,113
Other taxes and social security	25,600	16,796
Pensions payable	-	2,693
Other creditors	1,132	4,243
Accruals and deferred income	178,965	159,108

	442,785	701,953

6. Share Capital

	2024	2023
	£	£
Allotted, Called up and fully paid	19,172	19,172

7. Other Commitments

Total financial commitments, guarantees and contingencies which are not included in the balance sheet amount to £39,819 (2023: £69,673).

8. Pension Commitments

The company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund.

During the year the charge to the profit and loss account in respect of defined contribution schemes was £73,507 (2023:£71,664).

At the balance sheet date contributions of £NIL were due to the fund and are included in creditors.

9. Going Concern

As on 31 December 2024 the company (the “Company”), Artelo Biosciences Limited, had net assets of £167,562 (31 December 2023: net assets of £567,515), had made a net loss of £3,075,636 (31 December 2023: £4,319,116) and is reliant on the support of Artelo Biosciences, Inc., the parent company (the “Parent”).

During the year to 31 December 2024 the Parent invested £2,680,061 (31 December 2023: £3,367,183) into the Company by way of a capital contribution. The Parent is listed on the Nasdaq Capital Markets exchange in the United States of America under the symbol ARTL.

The consolidated accounts for the Parent have been prepared for the period ended 31 December 2024 and reflect consolidated net assets of approximately $3.0 million (2023: $12m). The Parent has incurred losses for several years and a net loss of $9.8 million for the year to 31 December 2024 and $9.3 million in the year to 31 December 2023.

The Parent has indicated that they will not withdraw their support from the Company for at least the next twelve months. At the time of writing, the Parent is in the process of raising further capital. The directors are aware of the risks associated with its failing to do so in a timely manner. These risks include the inability to maintain the current research programme and scientific team based in the UK.

...CONTINUED

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Artelo Biosciences Limited

Notes to the Financial Statements (continued)

For The Year Ended 31 December 2024

The directors of the Company and group are currently finalising interim funding that will provide the Company in the UK with working capital to cover all outgoings for the next several months. In this period the group directors are seeking funding that will take the group forward for its current and next phase of trials for at least the next 12 months. Although the directors are committed to achieving the capital requirements, the success of securing this funding is still uncertain. As of the time of signing these accounts approximately half of this funding has been secured, with the remainder expected to be raised via the public markets within the next few weeks. The directors have prepared these accounts on the basis that this funding is forthcoming and hence have presented these accounts on a going concern basis and not on a liquidation basis. Given the fundamental nature of this issue, it is important to highlight the uncertainty to interested parties.

10. Audit Information

The auditor's report on the accounts of Artelo Biosciences Limited for the year ended 31 December 2024 was unqualified.

The auditor's report was signed by Richard Stonier (Senior Statutory Auditor) for and on behalf of Deans Chartered Accountants , Statutory Auditor.

Deans Chartered Accountants

Gibson House

Hurricane Court, Hurricane Close

Stafford

ST16 1GZ

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		2024		2023
	Notes	£	£	£	£
CURRENT ASSETS
Debtors	4	139,148		353,614
Cash at bank and in hand		471,199		915,854

		610,347		1,269,468
Creditors: Amounts Falling Due Within One Year	5	(442,785 )		(701,953 )

NET CURRENT ASSETS (LIABILITIES)			167,562		567,515

TOTAL ASSETS LESS CURRENT LIABILITIES			167,562		567,515

NET ASSETS			167,562		567,515

CAPITAL AND RESERVES
Called up share capital	6		19,172		19,172
Capital contribution			16,211,647		13,535,964
Profit and Loss Account			(16,063,257 )		(12,987,621 )

SHAREHOLDERS' FUNDS			167,562		567,515