SEDAR Interim Financial Statements

PHARMACIELO LTD. CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 (EXPRESSED IN CANADIAN DOLLARS) (UNAUDITED) Notice to Reader The accompanying unaudited condensed interim consolidated financial statements of Pharmacielo Ltd.(the "Company") have been prepared by and are the responsibility of management. The unaudited condensed interim unaudited condensed interim consolidated financial statements have not been reviewed by the Company's auditors. Management’s Comments on Unaudited Condensed Interim Consolidated Financial Statements The accompanying unaudited condensed interim consolidated financial statements of PharmaCielo Ltd. (the “Company” or “PharmaCielo”) for the three and nine months ended December 31, 2025, have been prepared by the management of PharmaCielo, reviewed by the Audit Committee of the Board of Directors and approved by the Board of Directors. In accordance with National Instrument 51-102, Continuous Disclosure Obligations of the Canadian Securities Administrators, the Company herewith discloses that the accompanying unaudited interim consolidated financial statements have not been reviewed by an auditor. March 2, 2026 “Marc Lustig” “Ian Atacan” Marc Lustig Ian D. Atacan Chairman and Chief Executive Officer Director and Chief Financial Officer (Expressed in Canadian Dollars, except as noted) (unaudited) Note Reference As at December 31, 2025 As at March 31, 2025 ASSETS Current assets Cash 289,242 54,108 Trade receivables 4 241,474 469,511 Prepaid expenses and other receivables 5 1,408,078 519,661 Inventory and Biological assets 6 1,718,875 1,365,279 Total current assets 3,657,669 2,408,559 Non-current assets Property, plant, and equipment 7 4,906,161 16,119,293 Total non-current assets 4,906,161 16,119,293 Total assets 8,563,830 18,527,852 LIABILITIES AND SHAREHOLDERS' DEFICIT Current liabilities Accounts payable and accrued liabilities 5,245,418 5,759,889 RSU obligations 13 25,930 25,930 Current portion of debt 8 2,599,967 4,340,437 Current portion of debentures 9 16,047,213 13,269,053 Total current liabilities 23,918,528 23,395,309 Non-current liabilities Non-current portion of debentures 9 - 4,622,849 Total non-current liabilities - 4,622,849 Total liabilities 23,918,528 28,018,158 Shareholders' deficit Share capital 10 168,152,071 168,152,071 Shares to be issued 10 1,138,513 1,069,613 Reserves 11,12,13 36,992,615 36,975,137 Accumulated other comprehensive loss (9,276,717) (5,605,400) Deficit (212,361,180) (210,081,727) Total shareholders' deficit (15,354,698) (9,490,306) Total liabilities and shareholders' deficit 8,563,830 18,527,852 Nature of operations and Going concern 1 Commitments 16 Subsequent events 18 21 On behalf of the Board "Marc Lustig" , Chairman "Douglas Bache" , Director Condensed Interim Consolidated Statements of Financial Position PHARMACIELO LTD. The accompanying notes to the unaudited condensed interim consolidated financial statements are an integral part of these statements. (unaudited) December 31, December 31, Note Reference 2025 2024 2025 2024 Revenue: Sale of Cannabis derivative products 481,883 1,083,801 1,516,681 3,117,773 Revenue from Telemedicine services 124,264 43,161 301,040 121,756 Total revenue 606,147 1,126,962 1,817,721 3,239,529 Cost of (Cost adjustment to) goods sold - Cannabis (465,584) 536,683 906,660 1,828,762 Cost of goods sold - Telemedicine services 67,419 7,253 200,691 25,761 Gross profit before fair value adjust --- ments 1,004,312 583,026 710,370 1,385,006 Unrealized loss on fair value of biological assets 6 (498) (100,165) (263,939) (255,644) Gross profit 1,003,814 482,861 446,431 1,129,362 Selling, general, and administrative expenses General and administrative Office and general 57,804 203,688 336,598 454,652 Professional fees 130,884 120,933 737,836 752,828 Salaries and wages 78,937 603,070 2,098,186 2,014,415 Travel and accommodation 26,330 8,765 37,728 20,861 Share-based compensation 27,122 95,770 86,379 927,889 Selling, marketing, and promotion 444 1,165 4,833 1,165 Amortization and depreciation 7 4,072 21,001 72,701 119,220 Impairment expense - 27,640 - 820,214 Total selling, general, and administrative expenses 325,593 1,082,032 3,374,261 5,111,244 Other (income) expense Bank charges 12,500 26,295 38,234 120,475 Financing costs 8,9 482,050 791,024 1,808,136 2,592,874 Loss on foreign exchange 40,946 83,073 1,497,983 75,685 Other non-operating income 6,648 (5,510) 6,630 (131) Other revenue (911,510) (176,546) (1,135,384) (234,525) Other expense 640,177 185,125 49,524 185,123 Interest income - (3) - (10) Gain on sale of land - - (2,913,500) - Total other (income) expense 270,811 903,458 (648,377) 2,739,491 Profit (Loss) before income taxes 407,410 (1,502,629) (2,279,453) (6,721,373) Current income tax recovery - - - - Deferred income tax recovery - - - - Profit (Loss) from continuing operations 407,410 (1,502,629) (2,279,453) (6,721,373) Net profit (loss) for the period 407,410 (1,502,629) (2,279,453) (6,721,373) Nine Months Ended Condensed Interim Consolidated Statements of Loss and Comprehensive Loss PHARMACIELO LTD. (Expressed in Canadian Dollars, except as noted) The accompanying notes to the unaudited condensed interim consolidated financial statements are an integral part of these statements. Three Months Ended December 31, December 31, Note Reference 2025 2024 2025 2024 Other comprehensive loss Currency translation adjustment (3,406,303) (212,921) (3,671,317) (1,053,366) Net comprehensive loss (2,998,893) (1,715,550) (5,950,770) (7,774,739) Basic and diluted profit (loss) per share 14 0.002 (0.009) (0.012) (0.039) Weighted average number of common shares outstanding - basic and diluted 187,983,694 175,269,691 187,983,694 171,022,274 The accompanying notes to the unaudited condensed interim consolidated financial statements are an integral part of these statements. PHARMACIELO LTD. Condensed Interim Consolidated Statements of Loss and Comprehensive Loss (Expressed in Canadian Dollars, except as noted) Nine Months Ended (unaudited) Three Months Ended (unaudited) Note Reference Number of Common Shares Share Capital Shares to be issued Reserves Accumulated other comprehensive loss Deficit Total Balance at December 31, 2023 169,135,718 165,984,895 786,540 35,620,535 (5,359,587) (198,712,011) (1,679,628) Shares issued for debenture interest payment 11 5,979,496 944,165 - - - - 944,165 Shares issued for settlement of debt 10 609,439 85,322 - - - - 85,322 Cash received as prepayment for equity offering 10 - - 1,550,000 - - - 1,550,000 Warrants issued for debentures 11 - - - 161,469 - - 161,469 Vested RSUs 13 - - - - - - - Share-based compensation 10,11,12,13 - - - 1,382,518 - - 1,382,518 Currency translation adjustment for the period - - - - (818,496) - (818,496) Net loss for the period - - - - - (9,141,476) (9,141,476) Balance at December 31, 2024 175,724,653 167,014,382 2,619,613 36,881,449 (6,178,083) (207,853,487) (7,516,126) Balance at M --- arch 31, 2025 187,983,694 168,152,071 1,069,613 36,975,137 (5,605,400) (210,081,727) (9,490,306) Vested RSUs 13 - - 68,900 (68,900) - - - Share-based compensation 10,11,12,13 - - - 86,378 - - 86,378 Currency translation adjustment for the period - - - - (3,671,317) - (3,671,317) Net loss for the period - - - - - (2,279,453) (2,279,453) Balance at December 31, 2025 187,983,694 168,152,071 1,138,513 36,992,615 (9,276,717) (212,361,180) (15,354,698) PHARMACIELO LTD. Condensed Interim Consolidated Statements of Changes in Shareholders' Deficit (Expressed in Canadian Dollars, except share amounts) The accompanying notes to the unaudited condensed interim consolidated financial statements are an integral part of these statements. (unaudited) December 31, Note Reference 2025 2024 Operating Activities Net loss (2,279,453) (6,721,373) Items not affecting cash: Amortization and depreciation 7,8 669,296 882,046 Unrealized loss on fair market value of biological assets 6 216,423 255,644 Financing costs 8,9,10 2,022,778 2,520,829 Share-based compensation 86,378 1,143,890 Loss (gain) on foreign exchange 245,887 (97,747) Impairment of property, plant and equipment 8 - 909,592 Changes in non-cash working capital items Trade receivables 4 243,936 (304,233) Prepaid expenses and other receivables 5 (818,424) 308,646 Inventory and biological assets 6 (662,491) 287,523 Accounts payable and accrued liabilities (606,659) (534,542) Net cash used in operating activities (882,329) (1,349,725) Investing Activities Net proceeds from sale of land 7 6,655,747 - Net cash provided by investing activities 6,655,747 - Financing Activities Cash received from debentures 10 - 670,000 Cash received as part of bridge loan 8 300,000 1,313,000 Loan principal and interest payments 9 (5,853,391) (653,452) Net cash provided by (used in) financing activities (5,553,391) 1,329,548 Net increse (decrease) in cash 220,027 (20,177) Effect of movements in exchange rates on cash held 15,107 (9,111) Cash, beginning of period 54,108 177,227 Cash, end of period 289,242 147,939 The accompanying notes to the unaudited condensed interim consolidated financial statements are an integral part of these statements. PHARMACIELO LTD. Condensed Interim Consolidated Statements of Cash Flows (Expressed in Canadian Dollars) Nine Months Ended PHARMACIELO LTD. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 (Expressed in Canadian Dollars, except as noted) (Unaudited) - 8 - 1. NATURE OF OPERATIONS AND GOING CONCERN PharmaCielo Ltd. ("PharmaCielo" or the "Company") was incorporated pursuant to the Business Corporations Act (British Columbia) on May 30, 2017. The Company’s common shares (the "Common Shares") are listed on the TSX Venture Exchange (the “TSXV”) under the symbol "PCLO" and on the OTC Markets under the symbol "PCLOF". The head office is located at 82 Richmond Street East, Toronto, Ontario, M5C 1P1. Through the Company’s wholly owned subsidiary, PharmaCielo Colombia Holdings S.A.S. (“PharmaCielo Colombia”), the Company is licensed by the Colombian Ministry of Health and Social Protection and the Colombian Ministry of Justice and Law to cultivate, produce, and distribute (domestically and internationally) both THC (tetrahydrocannabinol) and CBD (cannabidiol) medicinal cannabis extracts. These unaudited condensed interim consolidated financial statements have been prepared on the basis that the Company will continue as a going concern, which assumes that the Compa --- ny will be able to raise the necessary capital on terms acceptable to the Company and be able to realize its assets and satisfy its liabilities in the normal course of business for the foreseeable future. As at December 31, 2025, the Company’s cash was $289,242. The Company’s current liabilities exceeded its current assets by $20,260,859, a net loss for the nine months ended December 31, 2025, of $2,279,453 and net cash used in operating activities of $882,329. The Company has not yet been able to generate the sales volumes required to create positive cash flows from operations. Management believes that the Company will be able to meet its budgeted administrative and development costs during the current year and beyond considering the Company’s current financial forecast. PharmaCielo continues to enter into strategic agreements and finance offerings to source funds and maintain its operations. The assessment of the appropriateness of the going concern assumption includes significant judgements. From the Company’s perspective this includes the assumption that a portion of warrant and option holders will exercise their instruments. While the Company has been able to demonstrate the ability to raise capital to fund its operations, there can be no assurance that adequate funding will be available in the future, or under terms favourable to the Company. Whether and when the Company can generate sufficient operating cash flows to pay for its expenditures and settle its obligations as they fall due after December 31, 2025, is uncertain. Management is aware, in making its going concern assessment, of material uncertainties related to events and conditions that may cast significant doubt upon the Company’s ability to continue as a going concern. These consolidated financial statements do not include necessary adjustments to reflect the recoverability and classification of recorded assets and liabilities and related expenses that might be necessary should the Company be unable to continue as a going concern. Such adjustments could be material. 2. BASIS OF PRESENTATION The unaudited condensed interim consolidated financial statements of the Company have been prepared under IFRS Accounting Standards in accordance with International Accounting Standards 34, “Interim Financial Reporting” (“IAS 34”) as issued by the International Accounting Standards Board (“IASB”) and interpretations of the International Financial Reporting Interpretations Committee (“IFRIC”). The policies applied in these unaudited condensed interim consolidated financial statements are based on IFRS Accounting Standards issued and outstanding as of March 2, 2026, the date the Board of Directors approved these unaudited condensed interim consolidated financial statements. PHARMACIELO LTD. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 (Expressed in Canadian Dollars, except as noted) (Unaudited) - 9 - 2. BASIS OF PRESENTATION (continued) These unaudited condensed interim consolidated financial statements follow the same accounting policies and method of computation as the Company’s audited consolidated financial statements for the fifteen months ended March 31, 2025, with the exception of certain disclosures that are normally required to be included in annual consolidated financial statements which have been condensed or omitted. These unaudited condensed interim consolidated financial statements should be read in conjunction with the Company’s aud --- ited consolidated financial statements for the fifteen months ended March 31, 2025. a) Basis of measurement These unaudited condensed interim consolidated financial statements have been prepared on a historical cost basis except for financial instruments classified as financial instruments at fair value through profit or loss and biological assets, which are measured at their fair value. These consolidated financial statements are presented in Canadian dollars. The functional currency of the Canadian entity is the Canadian dollar and the functional currency of the operating subsidiaries in Colombia is the Colombian Peso (“COP”). b) Principles of consolidation These unaudited condensed interim consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, PharmaCielo Holdings Ltd., PharmaCielo Colombia Holdings S.A.S., and Ubiquo Telemedicina S.A.S (“Ubiquo”). The financial results of PharmaCielo’s subsidiaries are included in the unaudited condensed interim consolidated financial statements from the date that control commences until the date that control ceases. Control exists when the Company has the power, directly or indirectly, to govern the financial and operating policies of an entity to benefit from its activities. In assessing control, potential voting rights that are currently exercisable are considered. All inter-company balances and transactions have been eliminated in preparing the unaudited condensed interim consolidated financial statements. For the three and nine months ended December 31, 2025 , the following companies have been included within the unaudited condensed interim consolidated financial statements: 3. MATERIAL ACCOUNTING POLICY INFORMATION a) Critical accounting judgments and estimates The preparation of the unaudited condensed interim consolidated financial statements management to make judgments, estimates and assumptions that affect the application of accounting policies and reported amounts of assets and liabilities and income and expenses. Accordingly, actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. Significant estimates and judgments made by management in the preparation of these consolidated financial statements are outlined below. Company Location Principal activity PharmaCielo Ltd. Toronto, Canada Parent company PharmaCielo Holdings Ltd. Toronto, Canada Subsidiary of Parent company Ubiquo Telemedicina S.A.S. Medellin, Colombia Telemedicine software company PharmaCielo Colombia Holdings S.A.S. Medellin, Colombia Cultivation and processing PHARMACIELO LTD. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 (Expressed in Canadian Dollars, except as noted) (Unaudited) - 10 - 3. MATERIAL ACCOUNTING POLICY INFORMATION (continued) Property, plant and equipment impairment The Company reviews the carrying amounts of its finite-life intangible assets and property, plant and equipment, carried at cost to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent, if any, of the impairment loss. As part of the impairment testing, estimations would be involved in establishing the recoverable amo --- unt, including but not limited to, the assets fair value, discount rate, commission rate, real estate fees and dismantling costs in Note 7. Net realizable value of Inventory Net realizable value of inventories is management’s estimation of future selling price in the ordinary course of business, less estimated costs of completion and selling expenses. These estimates are based on the current market condition and the historical experience of the Company’s products sold. Inventory consists of work-in-progress, semi-finished and finished products which are stored and packaged in climate-controlled locations and have an expiry date of 48 months. Based on market demand, further reprocessing of work in progress and semi-finished products may be required at which point the expiry date would be reset. Reprocessing related costs of work-in progress and semi-finished products are insignificant. Biological Assets Determination of the fair values of the biological assets requires the Company to make various estimates and assumptions. These assumptions primarily relate to the costs required to bring the cannabis up to the point of harvest, costs to convert the harvested cannabis to finished goods, sales price, risk of loss, expected future yields from the cannabis plants and estimating values during the growth cycle. The fair value of biological assets is considered a Level 3 categorization in the IFRS Accounting Standards fair value hierarchy. The significant estimates and inputs used to assess the fair value of biological assets are discussed in Note 6. Share-based Compensation The Company uses the Black-Scholes pricing model to estimate the fair value of the warrants and options granted at the grant date. This model requires the input of a number of assumptions including expected dividend yields, expected stock volatility, expected time until exercise, expected forfeitures, and risk-free interest rates. Although the assumptions used reflect management’s best estimates, they involve inherent uncertainties based upon market conditions generally outside the control of the Company. If other assumptions were used, share-based compensation expense could be significantly impacted. b) New, amended and future IFRS Accounting Standards pronouncements The Company plans to adopt all applicable IFRS Accounting Standards issued. Pronouncements that are not applicable or where it has been determined do not have a significant impact to the Company have been excluded herein. The following amendments were effective and adopted for the year beginning 1 January 2024: IFRS 16 Leases (Amendment – Liability in a Sale and Leaseback); IAS 1 Presentation of Financial Statements (Amendment – Classification of Liabilities as Current or Non-current); and IAS 1 Presentation of Financial Statements (Amendment – Non-current Liabilities with Covenants) PHARMACIELO LTD. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 (Expressed in Canadian Dollars, except as noted) (Unaudited) - 11 - 3. MATERIAL ACCOUNTING POLICY INFORMATION (continued) The following amendments are effective for the year beginning on or after 1 January 2025: IAS 21 Effects of Changes in Foreign Exchange Rates (Amendment - Lack of Exchangeability) The following amendments are effective for the year beginning on or after 1 January 2027: IFRS 18 Presentation and Disclosures in Financial Statements The Company has assessed the impact of these new accounting standards and amendments. --- The Company does not expect any other standards issued by the IASB, but not yet effective, to have a material impact on the Company. 4. TRADE RECEIVABLES Most of the Company’s sales consist of bulk cannabis products sold internationally to various customers. As at December 31, 2025, based on an assessment of the amounts due from the Company’s specific clients, the Company recorded an expected credit loss of $113,128 (March 31, 2025 - $113,873). As at December 31, 2025, the Company recorded the following expected credit loss: 5. PREPAID EXPENSES AND OTHER RECEIVABLES December 31, 2025 March 31, 2025 For sale of cannabis derivative products 302,121 564,475 For revenue from telemedicine services 52,481 18,909 Expected credit loss (113,128) (113,873) Total trade receivables 241,474 $ 469,511 $ Balance, March 31, 2025 (113,873) Effect of foreign exchange differences 745 Balance, December 31, 2025 (113,128) As at December 31, 2025 As at March 31, 2025 VAT receivable 225,178 119,498 Prepaid expenses 1,030,302 30,877 Other receivables 152,598 369,286 Total prepaid expenses and other receivables 1,408,078 $ 519,661 $ PHARMACIELO LTD. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 (Expressed in Canadian Dollars, except as noted) (Unaudited) - 12 - 6. INVENTORY AND BIOLOGICAL ASSETS Inventory Biological assets Determination of the fair values of the biological assets requires the Company to make various estimates and assumptions. The fair value of biological assets is considered a Level 3 categorization in the IFRS Accounting Standards fair value hierarchy. The estimates and inputs used to assess the fair value of biological assets include the following assumptions As at December 31, 2025: CBD isolate a. Selling prices – selling prices are based on the Company's expected selling price per kilogram based on selling history, adjusted for current market conditions. To calculate the fair value of the biological assets, the selling price of a kilogram of CBD isolate is not directly used, it’s used as an input to determine the estimated selling price of plants b. Post-harvest costs – the costs are based on actual processing costs incurred by drying, trimming, extracting, testing and packaging activities incurred in the period, including overhead allocations for these activities. c. The stage of plant growth – the stage of plant growth is estimated by the number of days into the growing stage compared to the estimated growing time for a full harvest. During the nine months ended December 31, 2025, there were 1,841 plants cultivated. The estimated stage of growth was 73% (March 31, 2025 – 0%). d. Expected yield – the expected yield per plant is based on the Company’s historical adjusted average yield per plant. During the nine months ended December 31, 2025, the expected yield per plant 1.31 grams of CBD isolate (March 31, 2025 – 0 grams). The low yield per plant was mainly due to cultivation of new strains on a trial basis and the refining yield at the plant decreased due to extraction of third-party biomass. Flower for export a. Selling prices – selling prices are based on the Company's expected selling price per kilogram based on selling history, adjusted for current market conditions. To calculate the fair value of the biological assets, the selling price of a kilogram of export flower. b. Post-harvest costs – the costs are based on actual processing costs incurred by drying, trimming, extracting, testing and packa --- ging activities incurred in the period, including overhead allocations for these activities. c. The stage of plant growth – the stage of plant growth is estimated by the number of days into the growing stage compared to the estimated growing time for a full harvest. During the nine months ended December 31, 2025, there were 2,292 plants cultivated, all of them at rooting and hardening stages, therefore, the estimated stage of growth was 10% (March 31, 2025 - 85%). As at December 31, 2025 As at March 31, 2025 Agricultural supplies and other 180,694 176,167 Work-in-progress 1,214,376 837,971 Finished products 309,902 347,473 Closing balance 1,704,972 $ 1,361,611 $ PHARMACIELO LTD. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 (Expressed in Canadian Dollars, except as noted) (Unaudited) - 13 - 6. INVENTORY AND BIOLOGICAL ASSETS (continued) d. Expected yield – the expected yield per plant is based on the Company’s historical adjusted average yield per plant. During the nine months ended December 31, 2025, there was no production of cannabis plants, therefore, the expected yield per plant is 0 grams of flower (March 31, 2025 – 53.3 grams). As at December 31, 2025, the Company’s biological assets consist of cannabis plants. The changes in the fair value of biological assets are as follows: As at September 30, 2024, the Company’s biological assets consist of cannabis plants. The changes in the fair value of biological assets were as follows: The Company expects that a 10% increase or decrease in the wholesale market price per kilogram of CBD isolate would increase or decrease the fair value of biological assets by $517 (2024 - $4,296). A 10% increase or decrease in the estimated yield per cannabis plant would result in an increase or decrease in the fair value of biological assets by $238 (2024 - $3,064). Additionally, an increase or decrease of 10% in the post-harvest costs would decrease or increase the fair value of biological assets by $256 (2024 - $926). 7. PROPERTY, PLANT AND EQUIPMENT PharmaCielo Colombia Holdings S.A.S. property, located in Rio Negro in the municipality of La Cieja (Antioquia), for the purpose of cultivating and sowing, as well as assembly of the cannabis oil. The property includes greenhouses, offices, and a pharmaceutical grade cannabis processing facility. On October 6, 2025, PharmaCielo announced that it sold its other unused parcel of land known as “La Margarita,” located in Rio Negro, Colombia for gross proceeds of COP $26,000,000 (approximately CAD $8.9 million) and repaid Banco Agrario Loan (Note 8) and made partial repayments of outstanding debentures (Note 9). As a result, PharmaCielo booked a gain from land sale of $2.9 million. Carrying amount, March 31, 2025 3,668 Production costs capitalized 241,702 Changes in fair value less costs to sell due to biological transformation (216,423) Transferred to inventory upon harvest (15,509) Effect of foreign exchange differences 466 Balance, December 31, 2025 13,904 Carrying amount, December 31, 2023 109,239 $ Production costs capitalized 88,166 Changes in fair value less costs to sell due to biological transformation (297,342) Transferred to inventory upon harvest 161,264 Effect of foreign exchange differences (27,890) Balance, December 31, 2024 33,437 $ - 14 - PHARMACIELO LTD. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 (Expressed in Canadian Dollars) (Unaudited) 8. PROPERTY, PLANT AND EQUIP --- MENT (continued) COST Land Building Machinery and equipment Office furniture and fixtures Computer and communication equipment Vehicles Total Balance, December 31, 2023 7,048,741 $ 12,456,606 $ 4,955,435 $ 925,413 $ 835,416 $ 75,011 $ 26,296,622 $ Disposals - (13,484) (5,203) - (172) - (18,859) Impairment - (824,595) - - - - (824,595) Effect of foreign exchange differences (23,382) (57,342) (25,342) (1,664) (4,536) (384) (112,650) Balance, March 31, 2025 7,025,359 $ 11,561,185 $ 4,924,890 $ 923,749 $ 830,708 $ 74,627 $ 25,340,518 $ Additions - 76,512 - - - - 76,512 Disposals (6,028,126) (3,943,620) (409,381) (22,010) (440) - (10,403,576) Effect of foreign exchange differences (106,014) (137,330) (117,488) (7,546) (20,564) (1,739) (390,681) Balance, December 31, 2025 891,219 $ 7,556,747 $ 4,398,021 $ 894,193 $ 809,704 $ 72,888 $ 14,622,773 $ ACCUMULATED DEPRECIATION Balance, December 31, 2023 - $ (2,903,392) $ (2,987,845) $ (799,091) $ (820,394) $ (75,011) $ (7,585,733) $ Additions - (573,633) (998,694) (56,672) (12,911) - (1,641,910) Effect of foreign exchange differences - 1,952 (1,187) 1,022 4,247 384 6,418 Balance, March 31, 2025 - $ (3,475,073) $ (3,987,726) $ (854,741) $ (829,058.0) $ (74,627) $ (9,221,225) $ Additions - (260,179) (399,444) (7,937) (1,737) - (669,296) Effect of foreign exchange differences - 56,238 88,949 5,892 21,091 1,739 173,909 Balance, December 31, 2025 - $ (3,679,014) $ (4,298,221) $ (856,786) $ (809,704) $ (72,888) $ (9,716,612) $ CARRYING AMOUNT Balance, March 31, 2025 7,025,359 $ 8,086,112 $ 937,164 $ 69,008 $ 1,650 $ - $ 16,119,293 $ Balance, December 31, 2025 891,219 $ 3,877,733 $ 99,800 $ 37,408 $ - $ - $ 4,906,161 $ PHARMACIELO LTD. Notes to the Condensed Interim Consolidated Financial Statements June 30, 2025 (Expressed in Canadian Dollars, except as noted) (Unaudited) - 15 - 7. PROPERTY, PLANT AND EQUIPMENT (continued) For the three and nine months ended December 31, 2025, depreciation costs of $48,385 and $125,944, respectively was capitalized to biological assets and inventory (2024 - $267,806 and $838,452 respectively).The decrease represents removal of La Margarita cultivation land after its sale. 8. LOANS AND BORROWINGS The company had the following loans: In December 2020, the Company entered into a loan agreement (“loan”) with Banco Agrario de Colombia S.A. (“Banco Agrario”), consisting of term and revolving components for a total value of $8,500,000,000 COP ($3,151,684). The term loan was for seven (7) years and made up $8,000,000,000 COP ($2,966,076) of the initial loan proceeds received. Per the details of the agreement, the term loan bore interest at a variable rate of Reference Banking Indicator (“IBR”) + 7.85%, payable semi-annually during the first 24 months, and quarterly thereafter. The term loan was subject to a capital amortization grace period of up to 24-months. There were certain externally imposed capital requirements as a result of the loan. The loan was secured against part of the Company's La Margarita property. La Margarita was the location of the Company’s nursery and propagation center consisting of 12 hectares of open-air greenhouses situated on a 26.3- hectare property, located in the municipality of Rio Negro in the department of Antioquia, Colombia. In June 2025, PharmaCielo Colombia paid off the entirety of the outstanding principal and accrued interest to Banco Agrario . During the nine months ended December 31, 2025, the Company received bridge loans from certain di --- rectors and senior officers of the Company as prepayment for a potential equity offering. $300,000 was received and recorded as current liability (fifteen months ended March 31, 2025 - $2,000,000). The bridge loans mature six months from the initial issuance date, bear 11% annual interest, and are secured by the assets of the Company (Note 15). Term loan Bridge loan Total Balance, March 31, 2025 2,340,437 $ 2,000,000 $ 4,340,437 $ Interest expense - 299,967 299,967 Principal payment (2,285,891) - (2,285,891) Loan additions - 300,000 300,000 Effect of foreign exchange differences (54,546) - (54,546) Balance, December 31, 2025 - 2,599,967 2,599,967 Current portion of debt - (2,599,967) (2,599,967) Non-current portion of debt - $ - $ - $ PHARMACIELO LTD. Notes to the Condensed Interim Consolidated Financial Statements June 30, 2025 (Expressed in Canadian Dollars, except as noted) (Unaudited) - 16 - 9. DEBENTURES The following table is a summary of the Company’s debentures As at December 31, 2025: On December 24, 2021, the Company issued debenture units (“Unit”) in a non-brokered private placement (“Offering”). Each Unit consisted of $1,000 principal amount of 11% secured debentures (“Debenture”) and 250 non-transferable common share purchase warrants (“Debenture Warrant”). Each Debenture Warrant entitled the holder for a period of 36 months from the initial closing date to acquire one common share of the Company at an exercise price of $1.44. The Debentures bear interest at a rate of 11% per annum, mature on December 24, 2024, and are guaranteed by PharmaCielo Colombia. PharmaCielo Colombia’s guarantee of the Debentures are secured by mortgages on the real property of PharmaCielo Colombia. Debenture interest payable is due on June 1st and December 1st of each year and the Company has the right to settle debenture interest payable in cash or in shares of the Company, at the discretion of the Company. On June 29, 2023, the Company closed the final tranche of the Offering. Under the Offering, PharmaCielo issued 12,825 debenture units, for aggregate proceeds of $12,825,000. Following the closure of the Offering, the Company announced new debenture units (“New Unit”) in a non-brokered private placement (the “New Offering”). The New Units are issued at a price of $1,000 per New Unit. Each New Unit consists of $1,000 principal amount of 11% secured debentures (“New Debenture”) and 1,000 non-transferable common share purchase warrants (“New Debenture Warrant”). Each New Debenture Warrant entitles the holder for a period of 60 months from the initial closing date to acquire one common share of the Company at an exercise price of $0.22. The New Debentures bear interest at a rate of 11% per annum, will mature on June 30, 2026, and carry the same guarantee as the Debenture. The Company has the right to redeem any or all of the Debentures and New Debentures from time to time at the following percentages of face value: (i) 105% at any time prior to the first anniversary of the initial closing date; (ii) 103% at any time on or after the first anniversary of the initial closing date and prior to the second anniversary of the initial closing date; and (iii) 101% thereafter, in each case together with accrued and unpaid interest to, but not including, the date of redemption. Upon a change of control of the Company, the holders will have the right to have their Debentures and New Debentures repurchased at 105% of face value plus accrued and unpaid interest t --- o, but not including the date of repurchase. During the period ended December 31, 2025, PharmaCielo made partial repayments to debenture holders of the Offering. 10. SHARE CAPITAL a) Authorized share capital The authorized share capital consists of an unlimited number of Common Shares. The Common Shares do not have a par value. All currently issued and outstanding Common Shares are fully paid. Balance as at March 31, 2025 17,891,902 $ Accrued interest 1,385,157 Accretion 337,654 Debenture partial repayment (3,567,500) Debentures balance, December 31, 2025 16,047,213 $ Current portion of the Debentures 16,047,213 Non current portion of the Debentures - $ PHARMACIELO LTD. Notes to the Condensed Interim Consolidated Financial Statements June 30, 2025 (Expressed in Canadian Dollars, except as noted) (Unaudited) - 17 - 10. SHARE CAPITAL (continued) b) Common Shares issued and outstanding 187,983,694 Common Shares (March 31, 2025 - 187,983,694 Common Shares). For the nine months ended December 31, 2024 (i) During the nine months ended December 31, 2024, the Company issued 609,439 Common Shares for debt settlement of $85,322 with suppliers and former employees of the Company. (ii) During the six months ended September 30, 2024, the Company received funds as prepayment for a potential equity offering. $425,000 was recorded as shares to be issued and reported in the Company’s statement of changes in shareholders’ equity. For the three and nine months ended December 31, 2025 (iii) During the three and nine months ended December 31, 2025, there was no share capital activity. 11. WARRANTS The following table reflects the continuity of warrants for the three and nine months ended December 31, 2025, and fifteen months ended March 31, 2025: (i) Warrants issued, expiry date extended or expired in the fifteen months ended March 31, 2025, include the following: a. As part of June 30, 2023, Non-Brokered Private Placement, the Company issued 985,000 warrants exercisable at $0.22 per Warrant Share. b. 3,206,250 warrants issued as part of December 24, 2021, Non-Brokered Private Placement, expired upon the maturity of the Debentures on December 24, 2024. c. 9,007,200 warrants with original expiration date of November 20, 2024, and extended expiration date of November 20, 2025. The following table reflects the warrants issued and outstanding As at December 31, 2025: Number of warrants Weighted average exercise price Balance, December 31, 2023 16,228,450 0.70 $ Issued (i)a. 985,000 0.22 Expired (i)b. (3,206,250) 1.44 Balance, March 31, 2025 14,007,200 0.50 $ Balance, March 31, 2025 14,007,200 0.50 Expired (i)c. (9,007,200) 0.65 Balance, December 31, 2025 5,000,000 0.22 $ Number of warrants outstanding Exercise price Expiry date 5,000,000 0.22 June 30, 2028 5,000,000 PHARMACIELO LTD. Notes to the Condensed Interim Consolidated Financial Statements June 30, 2025 (Expressed in Canadian Dollars, except as noted) (Unaudited) - 18 - 12. STOCK OPTIONS The following table reflects the continuity of options for the three and nine months ended December 31, 2025, and for the fifteen months ended March 31, 2025: (i) Options granted during the fifteen months ended March 31, 2025, include the following: On April 9, 2024, the Company granted a total of 3,050,000 incentive stock options to Board of Directors, Officers and Employees of the Company. Each option is exercisable for one Common Share at a price of $0.22 on or before April 9, 2029. The options vest as follows: 1,525, --- 000 immediately on the grant date; 762,500 on the first anniversary of the grant date; 762,500 on the second anniversary of the grant date. The fair value of each option has been estimated at $0.1984 as at the date of the grant based on the Black-Scholes option pricing model. The following assumptions were used: share price of $0.26, exercise price of $0.22, expected stock price volatility of 95.92%, risk-free rate of 3.55%, and expected life of 5 years. During the three and nine months ended December 31, 2025, the Company recorded $27,123 and $59,257, respectively in share-based expense related to these stock options and reported in the Company’s statement of loss and comprehensive loss (2024 - $103,989 and $832,119). Details of the stock options outstanding As at December 31, 2025, are as follows: Number of options Weighted average exercise price (USD) Weighted average exercise price (CAD) Balance, December 31, 2023 13,953,200 1.42 1.24 Granted (i) 3,050,000 - 0.22 Expired/Forfeited (1,427,000) 2.25 1.01 Balance, March 31, 2025 15,576,200 1.04 1.07 Granted - - - Expired/Forfeited (3,100,000) 0.25 0.67 Balance, December 31, 2025 12,476,200 1.07 1.18 Number of options outstanding Number of options exercisable Exercise price (USD) Exercise price (CAD) Weighted- average life (years) Expiry date 100,000 100,000 - 2.15 $ 0.37 May 13, 2026 560,000 560,000 - 2.10 $ 0.44 June 10, 2026 850,000 850,000 1.00 $ - 0.51 July 4, 2026 50,000 50,000 - 1.25 $ 0.71 September 14, 2026 550,000 550,000 - 3.10 $ 0.85 November 5, 2026 100,000 100,000 - 1.10 $ 0.86 November 11, 2026 400,000 400,000 - 1.10 $ 0.97 December 20, 2026 300,000 300,000 1.00 $ - 1.01 January 2, 2027 100,000 100,000 1.00 $ - 1.08 January 27, 2027 100,000 100,000 2.00 $ - 1.51 July 5, 2027 1,536,200 1,536,200 - 0.46 $ 1.66 August 29, 2027 2,630,000 1,972,500 - 0.22 $ 2.25 March 31, 2028 2,250,000 2,250,000 - 3.35 $ 2.50 July 1, 2028 2,950,000 1,475,000 - 0.22 $ 3.28 April 9, 2029 12,476,200 10,343,700 1.07 $ 1.18 $ 2.09 PHARMACIELO LTD. Notes to the Condensed Interim Consolidated Financial Statements June 30, 2025 (Expressed in Canadian Dollars, except as noted) (Unaudited) - 19 - 13. RESTRICTED SHARE UNITS (“RSUs”) and DEFERRED SHARE UNITS (“DSUs”) During the fifteen months ended March 31, 2025: (i) On April 9, 2024, the Company granted 1,060,000 RSUs to Directors, Officers and Employees of the Company. (ii) On April 9, 2024, the Company granted 1,845,948 DSUs to Directors, Officers and Employees of the Company. (iii) 845,812 RSUs vested and were pending share issuance. (iv) During the three and nine months ended December 31, 2025, 265,000 RSUs vested. As at December 31, 2025, there were 2,110,948 unvested RSUs and DSUs outstanding. 14. NET LOSS PER COMMON SHARE The calculation of basic and diluted profit (loss) per share for the three and nine months ended December 31, 2025, was based on the profit (loss) attributable to common shareholders of $407,410 profit and $2,279,453 loss respectively (2024 – loss of $1,502,629 and $6,721,373, respectively) and the weighted average number of Common Shares outstanding of 187,983,694 (2024 - 175,269,691 and 171,022,274, respectively). Diluted profit (loss) per share is equal to basic diluted loss per share as any effects of the potential convertible securities would be anti-dilutive. 15. TRANSACTIONS WITH RELATED PARTIES As at December 31, 2025, certain directors and officers of the Company have units issued for a non-brokered private placement o --- f debenture units in an aggregate principal amount totaling $3,707,500 (March 31, 2025 - $4,200,000) (Note 9). For debentures that matured on December 24, 2024, each debenture unit consisted of $1,000 principal amount of 11% secured debentures and 250 non-transferable warrants to purchase one common share of the Company at $1.44 per share (Note 11. The warrants expired on December 24, 2024. For debentures maturing on June 30, 2026, each debenture unit consists of $1,000 principal amount of 11% secured debentures and 1,000 non-transferable warrants to purchase one common share of the Company at $0.22 per share (Note 11). The warrants expire on June 30, 2028. During the three and nine months ended December 31, 2025, the Company received $300,000 from certain directors and senior officers of the Company as prepayment for a potential equity offering in the form of a bridge-loan (fifteen months ended March 31, 2025 - $2,000,000) (Note 9). Total amount due to related parties included in accrued liabilities As at December 31, 2025, was $1,033,344 (March 31, 2025 - $735,883). Number of unvested RSUs and DSUs outstanding Balance, December 31, 2023 315,812 Granted RSUs (i) 1,060,000 Granted DSUs (ii) 1,845,948 Vested RSUs (iii) (845,812) Balance, March 31, 2025 2,375,948 Vested RSUs (iv) (265,000) Balance, December 31, 2025 2,110,948 PHARMACIELO LTD. Notes to the Condensed Interim Consolidated Financial Statements June 30, 2025 (Expressed in Canadian Dollars, except as noted) (Unaudited) - 20 - 15. TRANSACTIONS WITH RELATED PARTIES (continued) Compensation of Key Management Key management personnel are those people who have the authority and responsibility for planning, directing and controlling activities of the Company, directly or indirectly. The key management personnel of the Company are the members of the Company’s executive management team and the Board of Directors, as well as certain key officers and board members of the Company's subsidiary. (1) Includes meeting fees and committee chair fees. (2) Share-based compensation represents the fair value of options and RSUs granted and vested to key management personnel and directors of the Company under the Company's share-based compensation plans. The related party transactions were in the normal course of operations and have been valued in the consolidated financial statements at the exchange amount, which is the amount of consideration established and agreed to by the related parties. The amounts owing to related parties are non-interest bearing and due on demand, unless otherwise disclosed. 16. COMMITMENTS a) Included in accounts payable and accrued liabilities, and other non-current liabilities are accruals for certain provisions, including termination related commitments to former officers, directors and employees of $27,084. b) $116,552 (80,000 EURO) of the $190,933 (132,000 EURO) settlement payment to PharmaCielo Italia S.R.L. remains payable and is recorded in accounts payable and accrued liabilities. 17. SEGMENTED INFORMATION The Company is engaged in the growth, cultivation and development of medicinal cannabis with operations in Colombia. The Company is considered to be operating in one segment based on its business nature and strategic decision- making method. The Company has operations in Rionegro, Colombia, with corporate offices in Toronto, Canada and Medellín, Colombia. 2025 2024 2025 2024 Management compensation 178,660 $ 175,604 $ 520,230 $ 514,033 $ Directors' fees (1) 29,3 --- 75 29,375 88,125 88,125 Share-based compensation (2) 10,674 26,144 33,995 833,882 Total management compensation 218,709 $ 231,123 $ 642,350 $ 1,436,040 $ For the three months ended December 31, For the nine months ended December 31, Revenues by region - for the nine months ended December 31, 2025 Americas 1,745,012 $ Australia 72,709 Total Revenue 1,817,721 $ Revenues by region - for the nine months ended December 31, 2024 Americas 1,335,166 $ Australia 701,119 Africa 977,037 Europe 226,207 Total Revenue 3,239,529 $ PHARMACIELO LTD. Notes to the Condensed Interim Consolidated Financial Statements June 30, 2025 (Expressed in Canadian Dollars, except as noted) (Unaudited) - 21 - 17. SEGMENTED INFORMATION (continued) The Company’s revenues by region is based on where the customer is located. The Company has property, plant and equipment as at December 31, 2025, of $4,906,161 (March 31, 2025 - $16,119,293) all in Colombia. Revenue Concentration The Company's business is currently such that, at any given time, it sells its products and services to a relatively small number of customers. During the nine months ended December 31, 2025, one customer accounted for 78% of cannabis revenue (2024 - 77%). 18. SUBSEQUENT EVENTS i. Since December 31, 2025, the Company has received aggregate gross proceeds of $75,000 bridge-loan from directors and officers as prepayment for a potential equity offering. ii. PharmaCielo will hold its annual general meeting of shareholders (the “AGM”) on April 2, 2026. The record date for determining shareholders entitled to receive notice of and vote at the AGM has been set as February 23, 2026. iii. On February 17, 2026, PharmaCielo announced that it intends to issue, subject to the approval of TSXV, 12,153,937 common shares of PharmaCielo (“Interest Shares”), at an effective price of $0.08 per Interest Share, in satisfaction of an aggregate of $972,317.12 in accrued semi-annual interest payments due to holders of the Company’s 11% secured debentures.