REGISTERED NUMBER: 11710367 (England and Wales)

GROUP STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2025

FOR

UNIVERSAL QUANTUM LTD

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

3

Report of the Independent Auditors

5

Consolidated Income Statement

9

Consolidated Other Comprehensive Income

10

Consolidated Balance Sheet

11

Company Balance Sheet

12

Consolidated Statement of Changes in Equity

13

Company Statement of Changes in Equity

14

Consolidated Cash Flow Statement

15

Notes to the Consolidated Cash Flow Statement

16

Notes to the Consolidated Financial Statements

17

DIRECTORS:

Dr S Weidt

Prof Dr W K Hensinger

REGISTERED OFFICE:

Gemini House

Mill Green Business Estate

Haywards Heath

West Sussex

RH16 1XQ

REGISTERED NUMBER:

11710367 (England and Wales)

AUDITORS:

Oury Clark Chartered Accountants

Statutory Auditors

Herschel House

58 Herschel Street

Slough

Berkshire

SL1 1PG

The directors present their strategic report of the company and the group for the year ended 31 December 2025.

BUSINESS REVIEW

Universal Quantum Limited (the "Company") and its subsidiaries (together, the "Group") are engaged in the research, development and commercialisation of scalable quantum computing hardware and software.

During the year, the Group continued to deliver against key milestones for its customers, including progress under its contract with the German Aerospace Center (DLR) to build two quantum computers. The Group also continued to explore increased international operations, with subsidiaries in Germany, Denmark, and the United States.

The Group continued its investment in research and development, talent, and infrastructure.

STRATEGY AND FUTURE OUTLOOK

The Group's long-term vision is to build scalable fault-tolerant quantum computers capable of solving some of the world's most complex problems. In the near term, the Group's focus remains on:

- Delivering on existing customer contracts and milestones;

- Continuing to expand its international presence; and

- Broadening its product offerings to serve the global quantum computing ecosystem.

PRINCIPAL RISKS AND UNCERTAINTIES

The Group is subject to a number of risks and uncertainties, the most significant of which include:

- Technology development risk: the inherent challenges in achieving scalable quantum computing.

- Funding risk: dependence on continued access to capital to fund long-term R&D.

- Talent risk: competition for highly specialised staff in a niche technical field.

- Intellectual property protection: safeguarding the Group's proprietary technology.

- Regulatory and geopolitical risk: potential changes in export controls, government policy, or international collaboration.

- Supply chain risk: reliance on specialist suppliers for components and manufacturing processes.

The Board regularly reviews these risks and takes steps to mitigate them where possible.

KEY PERFORMANCE INDICATORS

The Directors monitor the development and performance of the business through a range of financial and non-financial key performance indicators, including R&D milestones achieved, and contracts signed. As planned and in line with forecasts, turnover fell 19% to £9,166,751 (2024: £11,255,759).

SECTION 172 STATEMENT

In accordance with Section 172 of the Companies Act 2006, the Directors confirm that they have acted in a way that they consider would be most likely to promote the success of the Group for the benefit of its members as a whole, and in doing so have had regard to the interests of stakeholders, including employees, customers, suppliers, regulators, and the wider community. The Board is committed to maintaining open engagement with stakeholders and ensuring that their interests are considered in key decision-making processes.

ON BEHALF OF THE BOARD:

Prof Dr W K Hensinger - Director

27 May 2026

The directors present their report with the financial statements of the company and the group for the year ended 31 December 2025.

DIVIDENDS

No dividends will be distributed for the year ended 31 December 2025.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 January 2025 to the date of this report.

Dr S Weidt

Prof Dr W K Hensinger

THIRD-PARTY INDEMNITY INSURANCE

The Company has purchased and maintained throughout the financial year, at its expense, third-party indemnity insurance for the benefit of its directors. This insurance in respect of certain losses or liabilities which the directors may incur to third parties in the course of performing their duties.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Group Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and the group and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

-	prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

AUDITORS

The auditors, Oury Clark Chartered Accountants, are deemed to be re-appointed under Section 487 (2) of the Companies Act 2006.

ON BEHALF OF THE BOARD:

Prof Dr W K Hensinger - Director

27 May 2026

Opinion

We have audited the financial statements of Universal Quantum Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2025 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the group's and of the parent company affairs as at 31 December 2025 and of the group's loss for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and the parent company's ability to continue as a going concern for a period of at least twelve months and one day from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The directors are responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be misstated. If we identify such inconsistencies or apparent misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

-	the information given in the Group Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Group Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified any matters in the Group Strategic Report or the Report of the Directors that are inconsistent with our overall view of the financial statements.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

-	adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

-	the parent company financial statements are not in agreement with the accounting records and returns; or

-	certain disclosures of directors' remuneration specified by law are not made; or

-	we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page three, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the group's and the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Identifying and assessing potential irregularities, including fraud

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:

Considering the nature of the industry, sector, control environment and current business activities, including possible performance targets and subsequent remuneration.

Enquiring of management concerning policies and procedures relating to:

1. Complying with laws and regulations and whether there were any instances of non-compliance;

2. Mitigating, detecting and responding to fraud risk and whether there has been any actual or possible instances of fraud.

Discussions within the engagement team regarding how and where fraud may occur in the financial statements along with the possible indicators of fraud. We identified the following areas most likely to be susceptible to fraud:

1. Revenue recognition;

2. Management override.

Discussing within the engagement team the legal and regulatory framework in which the company operates and in particular those which would have an impact on the financial statements. The key laws and regulations considered were the Companies Act 2006, UK tax legislation and UK employment law, as well as German tax legislation and employment law.

Audit response to the risks identified

As noted above, we identified revenue recognition and management override as the matters that would most likely be susceptible to fraud. Our procedures to respond to these risks included the following:

1. Performing a detailed sales test of detail and cut off testing, including obtaining third-party milestone acceptance documentation to ensure that revenue is recognised in the correct period;

2. Reviewing all journals posted during the year and the nominal ledger and investigating large or unusual transactions.

Further, we also identified compliance with the Companies Act 2006, UK tax legislation and UK employment law, as well as German tax legislation and employment law, as being key areas where there may be possible non-compliance. Our procedures to respond to these risks included the following:

1. Review the disclosures in the financial statements through completion of a disclosure checklist and testing disclosures to supporting documentation to assess compliance with the Companies Act 2006;

2. Review the UK corporation tax return to ensure it complies with UK tax legislation and completion of our detailed corporation tax checklist;

3. We performed a high-level review to ensure compliance with German tax legislation;

4. Safeguard review of financial statements by a qualified accountant independent of the audit team;

5. Safeguard review of the UK corporation tax computation by a person qualified as a Chartered Tax Advisor or equivalent, independent of the audit team;

6. Check a sample of compliance with right to work checks and a review of legal fees for any indication of material issues arising out of non-compliance with employment law.

The above matters and identified laws and regulations and potential fraud risks were communicated to all engagement team members, in order to enable the team to have the ability to identify such risks. The whole team remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

There are inherent limitations in the audit procedures described above and the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Rachel Lockwood (Senior Statutory Auditor)

for and on behalf of Oury Clark Chartered Accountants

Statutory Auditors

Herschel House

58 Herschel Street

Slough

Berkshire

SL1 1PG

1 June 2026

TURNOVER

9,166,751

11,255,759

Cost of sales

6,231,930

1,481,686

GROSS PROFIT

2,934,821

9,774,073

Administrative expenses

11,469,713

9,958,821

(8,534,892

)

(184,748

)

Other operating income

578,231

1,164,418

OPERATING (LOSS)/PROFIT

4

(7,956,661

)

979,670

Interest receivable and similar income

99,870

221,619

(7,856,791

)

1,201,289

Interest payable and similar expenses

5

1,607

11

(LOSS)/PROFIT BEFORE TAXATION

(7,858,398

)

1,201,278

Tax on (loss)/profit

6

(2,048,152

)

(272,333

)

(LOSS)/PROFIT FOR THE FINANCIAL YEAR

(5,810,246

)

1,473,611

(Loss)/profit attributable to:

Owners of the parent

(5,810,246

)

1,473,611

(LOSS)/PROFIT FOR THE YEAR

(5,810,246

)

1,473,611

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(5,810,246

)

1,473,611

Total comprehensive income attributable to:

Owners of the parent

(5,810,246

)

1,473,611

FIXED ASSETS

Intangible assets

8

5,787,211

3,667,152

Tangible assets

9

3,133,659

3,401,879

Investments

10

-

-

8,920,870

7,069,031

CURRENT ASSETS

Stocks

11

256,822

1,769,993

Debtors

12

6,254,943

3,277,716

Cash at bank

3,628,474

7,024,624

10,140,239

12,072,333

CREDITORS

Amounts falling due within one year

13

1,956,852

1,680,367

NET CURRENT ASSETS

8,183,387

10,391,966

TOTAL ASSETS LESS CURRENT LIABILITIES

17,104,257

17,460,997

PROVISIONS FOR LIABILITIES

15

1,947,690

1,897,690

NET ASSETS

15,156,567

15,563,307

CAPITAL AND RESERVES

Called up share capital

16

164

161

Share premium

17

10,329,078

10,314,097

Other reserves

17

5,377,215

(11,307

)

Retained earnings

17

(549,890

)

5,260,356

SHAREHOLDERS' FUNDS

15,156,567

15,563,307

The financial statements were approved by the Board of Directors and authorised for issue on 27 May 2026 and were signed on its behalf by:

Prof Dr W K Hensinger - Director

Dr S Weidt - Director

FIXED ASSETS

Intangible assets

8

5,787,210

3,667,151

Tangible assets

9

2,894,092

3,193,126

Investments

10

27,424

22,932

8,708,726

6,883,209

CURRENT ASSETS

Debtors

12

8,498,207

10,636,779

Cash at bank

1,035,813

1,027,414

9,534,020

11,664,193

CREDITORS

Amounts falling due within one year

13

1,432,801

1,374,972

NET CURRENT ASSETS

8,101,219

10,289,221

TOTAL ASSETS LESS CURRENT LIABILITIES

16,809,945

17,172,430

PROVISIONS FOR LIABILITIES

15

1,947,690

1,897,690

NET ASSETS

14,862,255

15,274,740

CAPITAL AND RESERVES

Called up share capital

16

164

161

Share premium

17

10,329,077

10,314,098

Other reserves

17

5,377,000

-

Retained earnings

17

(843,986

)

4,960,481

SHAREHOLDERS' FUNDS

14,862,255

15,274,740

Company's (loss)/profit for the financial year

(5,804,467

)

1,263,697

The financial statements were approved by the Board of Directors and authorised for issue on 27 May 2026 and were signed on its behalf by:

Prof Dr W K Hensinger - Director

Dr S Weidt - Director

Called up

share

Retained

Share

Other

Total

capital

earnings

premium

reserves

equity

£

£

£

£

£

Balance at 1 January 2024

155

3,786,745

7,039,359

3,216,226

14,042,485

Changes in equity

Issue of share capital

6

-

3,274,738

-

3,274,744

Total comprehensive income

-

1,473,611

-

(3,227,533

)

(1,753,922

)

Balance at 31 December 2024

161

5,260,356

10,314,097

(11,307

)

15,563,307

Changes in equity

Issue of share capital

3

-

14,981

-

14,984

Total comprehensive income

-

(5,810,246

)

-

5,388,522

(421,724

)

Balance at 31 December 2025

164

(549,890

)

10,329,078

5,377,215

15,156,567

Called up

share

Retained

Share

Other

Total

capital

earnings

premium

reserves

equity

£

£

£

£

£

Balance at 1 January 2024

155

3,696,784

7,039,359

3,277,909

14,014,207

Changes in equity

Issue of share capital

6

-

3,274,739

-

3,274,745

Total comprehensive income

-

1,263,697

-

(3,277,909

)

(2,014,212

)

Balance at 31 December 2024

161

4,960,481

10,314,098

-

15,274,740

Changes in equity

Issue of share capital

3

-

14,981

-

14,984

Total comprehensive income

-

(5,804,467

)

-

5,377,000

(427,467

)

Balance at 31 December 2025

164

(843,986

)

10,329,079

5,377,000

14,862,257

Cash flows from operating activities

Cash generated from operations

1

(7,265,400

)

(3,765,254

)

Interest paid

(1,607

)

(11

)

Tax received

951,035

230,715

Net cash from operating activities

(6,315,972

)

(3,534,550

)

Cash flows from investing activities

Purchase of intangible fixed assets

(2,250,511

)

(2,258,312

)

Purchase of tangible fixed assets

(256,049

)

(1,481,151

)

Interest received

99,870

221,619

Net cash from investing activities

(2,406,690

)

(3,517,844

)

Cash flows from financing activities

Amount introduced by directors

99

-

Share issue

14,883

(3,530

)

Proceeds from ASA issue

5,377,000

-

Net cash from financing activities

5,391,982

(3,530

)

Decrease in cash and cash equivalents

(3,330,680

)

(7,055,924

)

Cash and cash equivalents at beginning of year

2

7,024,624

14,054,889

Effect of foreign exchange rate changes

(65,470

)

25,659

Cash and cash equivalents at end of year

2

3,628,474

7,024,624

1.	RECONCILIATION OF (LOSS)/PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

31.12.25

31.12.24

£

£

(Loss)/profit before taxation

(7,858,398

)

1,201,278

Depreciation charges

631,756

432,553

Loss on disposal of fixed assets

99,959

-

Provisions

50,000

88,700

Foreign exchange loss

80,587

508,472

Finance costs

1,607

11

Finance income

(99,870

)

(221,619

)

(7,094,359

)

2,009,395

Decrease/(increase) in stocks

1,513,171

(1,769,993

)

Increase in trade and other debtors

(1,996,904

)

(999,706

)

Increase/(decrease) in trade and other creditors

312,692

(3,004,950

)

Cash generated from operations

(7,265,400

)

(3,765,254

)

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 December 2025

31.12.25

1.1.25

£

£

Cash and cash equivalents

3,628,474

7,024,624

Year ended 31 December 2024

31.12.24

1.1.24

£

£

Cash and cash equivalents

7,024,624

14,054,889

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1.1.25

Cash flow

At 31.12.25

£

£

£

Net cash

Cash at bank

7,024,624

(3,396,150

)

3,628,474

7,024,624

(3,396,150

)

3,628,474

Total

7,024,624

(3,396,150

)

3,628,474

1.	STATUTORY INFORMATION

Universal Quantum Ltd is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the General Information page.

2.	ACCOUNTING POLICIES

Basis of preparing the 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" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

In accordance with Section 408 of the Companies Act 2006, the company has elected to take the exemption from presenting its individual profit and loss account.

Additionally, as ultimate parent company and a qualifying entity under FRS 102 paragraphs 1.8 to 1.12, the company has applied the exemption from presenting a separate parent company cash flow statement.

The financial statements have been prepared on the going concern basis as the Directors believe the group has sufficient net assets to continue operating for a period of at least 12 months and 1 day from the date of signing of the audit report attached to these financial statements.

Related party exemption

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.

Transactions between group entities which have been eliminated on consolidation are not disclosed within the financial statements.

Critical accounting judgements and key sources of estimation uncertainty

In preparing these financial statements, management has made judgements and estimates that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are set out below.

-Work in-Progress

Work in-progress (WIP) represents costs incurred on a contract to build a quantum computing system for a customer. These costs include materials, labour, and other directly attributable expenses related to components that will be used to satisfy contractual milestones and performance obligations after the balance sheet date.

Judgement is applied in determining the recoverability of WIP balances. Estimates are made regarding the expected costs to complete, the timing of milestone delivery, and the likelihood of meeting contractual obligations. These estimates directly impact the measurement of WIP.

-Development costs

Development costs relate to the design and construction of a prototype quantum computer intended for internal use and future commercialisation. Management assesses whether the criteria for capitalisation under FRS 102 Section 18 are met, including technical feasibility, intention and ability to complete the asset, and the availability of adequate resources.

Judgement is required to determine whether the project is likely to generate future economic benefits and whether costs are directly attributable to the development phase. Estimates are also made regarding the useful life of the asset and the point at which amortisation should commence.