VivoPower completes $37.7M Mo i Rana acquisition
VivoPower disclosed control weaknesses and restated FY2025 figures; full preference conversion would issue shares equal to approximately 14.2% of outstanding Class A shares.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
VivoPower PLC describes its shift to a Nordic digital-infrastructure platform and its completed May 12, 2026 acquisition of the Mo i Rana data center for US$37.7 million. The 41.5 MW facility is expected to convert from Bitcoin-mining hosting to AI-grade infrastructure. Consideration included US$20.9 million cash, 1,507,353 Class A shares at US$6.80, 1,055,147 warrants, and deferred payments of US$5.0 million in November 2026 and US$5.1 million in May 2027.
Debt obligations were US$39.0 million at June 30, 2026, versus US$29.2 million at June 30, 2025. VivoPower said AWN’s shareholder-loan principal was settled after year-end through cash and debt-to-equity swaps, while US$19.1 million of accrued interest remained owed. It disclosed material weaknesses in disclosure and financial reporting controls and restated FY2025 comparative information.
In FY2026, VivoPower issued 296,507 Series 1 preference shares at US$100 each, with a 6% cumulative payment-in-kind dividend and a US$6.80 conversion price. Full conversion would issue approximately 4,360,397 Class A shares before accrued dividends, approximately 14.2% of outstanding Class A shares. Tembo’s Cactus business combination was expected to close in Q1 2027, subject to regulatory and shareholder approvals.
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Hollow bars mark forward-looking points. How the balance works
Positive
- None.
Negative
- Major pointFY2025 statements were restated; material weaknesses in financial reporting controls were disclosed.
- Major point. Forward-looking: it has not happened yet and may not happen.Approximately 14.2% potential dilution from full conversion of Series 1 preference shares.
Key Figures
Key Terms
payment-in-kind dividend financial
material weakness financial
fair value through profit or loss financial
debt to equity swaps financial
pre-emption rights regulatory
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
How much was VIVO’s Mo i Rana acquisition?
How could VIVO’s Series 1 preference shares affect its Class A shareholders?
How many VIVO Class A Ordinary Shares were outstanding at June 30, 2026?
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
| REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 |
OR
| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For
the fiscal year ended
OR
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
OR
| SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Date of event requiring this shell company report
Commission
file number
(Exact name of Registrant as specified in its charter)
(Jurisdiction of incorporation or organization)
(Address of principal executive offices)
Tel:
(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)
Securities registered or to be registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol | Name of each exchange on which registered | ||
| The
|
Securities registered or to be registered pursuant to Section 12(g) of the Act:
None
(Title of Class)
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:
None
(Title of Class)
Indicate the number of outstanding shares of each of the issuer’s classes of capital or Ordinary Shares as of the close of the period covered by the annual report.
| Class A Ordinary Shares, nominal value $ | ||||
| Series 1 convertible preference shares, nominal value of $100 per share | 296,507 |
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐
If
this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section
13 or 15(d) of the Securities Exchange Act of 1934. Yes ☐
Note—Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Indicate
by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer ☐ | Accelerated filer ☐ | Emerging
growth company |
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. ☐
† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.
Indicate
by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness
of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered
public accounting firm that prepared or issued its audit report.
If
securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant
included in the filing reflect the correction of an error to previously issued financial statements.
Indicate
by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation
received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).
Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:
| U.S. GAAP ☐ | Other ☐ |
If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.
Item 17 ☐ Item 18 ☐
If
this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act). Yes ☐ No
TABLE OF CONTENTS
| Introduction | 1 | |
| Forward-Looking Statements | 1 | |
| PART I | 2 | |
| Item 1. Identity of Directors, Senior Management and Advisors | 2 | |
| Item 2. Offer Statistics and Expected Timetable | 2 | |
| Item 3. Key Information | 2 | |
| A. Selected Financial Data | 2 | |
| B. Capitalization and Indebtedness | 2 | |
| C. Reasons for the Offer and Use of Proceeds | 2 | |
| D. Risk Factors | 2 | |
| Item 4. Information on the Company | 31 | |
| A. History and Development of the Company | 31 | |
| B. Business Overview | 33 | |
| C. Organizational Structure | 41 | |
| D. Property, Plant and Equipment | 41 | |
| Item 4A. Unresolved Staff Comments | 42 | |
| Item 5. Operating and Financial Review and Prospects | 42 | |
| A. Operating Results | 43 | |
| B. Liquidity and Capital Resources | 46 | |
| C. Research and Development, Patents, Licenses, etc. | 48 | |
| D. Trend Information | 48 | |
| E. Critical Accounting Estimates | 49 | |
| Item 6. Directors, Senior Management and Employees | 50 | |
| A. Directors and Senior Management | 50 | |
| B. Compensation | 54 | |
| C. Board Practices | 55 | |
| D. Employees | 59 | |
| E. Share Ownership | 59 | |
| F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation | 61 | |
| Item 7. Major Shareholders and Related Party Transactions | 61 | |
| A. Major Shareholders | 61 | |
| B. Related Party Transactions | 62 | |
| C. Interests of Experts and Counsel | 66 | |
| Item 8. Financial Information | 66 | |
| A. Consolidated Statements and Other Financial Information | 66 | |
| B. Significant Changes | 68 | |
| Item 9. The Offer and Listing | 68 | |
| A. Offering and Listing Details | 68 | |
| B. Plan of Distribution | 68 | |
| C. Markets | 68 | |
| D. Selling Shareholders | 68 | |
| E. Dilution | 68 | |
| F. Expenses of the Issue | 68 | |
| Item 10. Additional Information | 68 | |
| A. Share Capital | 68 | |
| B. Memorandum and Articles of Association | 68 | |
| C. Material Contracts | 69 | |
| D. Exchange Controls | 69 | |
| E. Taxation | 69 | |
| F. Dividends and Paying Agents | 76 | |
| G. Statements by Experts | 76 | |
| H. Documents on Display | 77 | |
| I. Subsidiary Information | 77 | |
| Item 11. Quantitative and Qualitative Disclosures about Market Risk | 77 | |
| Item 12. Description of Securities Other than Equity Securities | 78 |
| i |
| Table of Contents |
| PART II | 79 | |
| Item 13. Defaults, Dividend Arrearages and Delinquencies | 79 | |
| Item 14. Material Modifications to the Rights of Securityholders and Use of Proceeds | 79 | |
| Item 15. Controls and Procedures | 79 | |
| Item 16. [Reserved] | 81 | |
| Item 16A. Audit Committee Financial Expert | 81 | |
| Item 16B. Code of Ethics | 81 | |
| Item 16C. Principal Accountant Fees and Services | 81 | |
| Item 16D. Exemption from the Listing Standards for Audit Committees | 82 | |
| Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers | 82 | |
| Item 16F. Change in Registrant’s Certifying Accountant | 82 | |
| Item 16G. Corporate Governance | 83 | |
| Item 16H. Mine Safety Disclosure | 83 | |
| Item 16I Foreign Jurisdictions that Prevent Inspections | 83 | |
| Item 16J Insider Trading Policies | 83 | |
| Item 16K Cybersecurity | 83 | |
| PART III | 84 | |
| Item 17. Financial Statements | 84 | |
| Item 18. Financial Statements | 84 | |
| Item 19. Exhibits | 84 | |
| Index to Consolidated Financial Statements | F-1 |
| ii |
| Table of Contents |
Introduction
References in this Annual Report on Form 20-F (the “Annual Report”) to “VivoPower PLC,” “VivoPower,” “we” “our,” “us” and the “Company” refer to VivoPower PLC and its consolidated subsidiaries. Our consolidated financial statements are prepared in accordance with International Financial Reporting Standards, as issued by the International Accounting Standards Board (“IFRS”), and are expressed in U.S. dollars. References to “dollars” or “$” are to U.S. dollars. Our fiscal year ends on June 30 of the calendar year.
References to any specific fiscal year refer to the year ended June 30 for 2026 and future periods. For example, we refer to the fiscal year ended June 30, 2026, as “FY26”. References to “Class A Ordinary Shares” or “ordinary shares” are to our Class A ordinary shares of nominal value $0.12 each, which are listed on Nasdaq under the symbol “VIVO”, and, for periods before the redesignation of our ordinary shares approved at our general meeting held on January 30, 2026, to our ordinary shares. Our articles of association also provide for Class B ordinary shares carrying twenty votes per share; no Class B Ordinary Shares have been issued as of the date of this Annual Report.
References to the “Mo i Rana Acquisition” are to our acquisition of the entire issued share capital of VivoPower Norge Infrastructure AS (formerly Cromwell AS) (“VivoPower Norge Infrastructure”), which was completed on May 12, 2026. VivoPower Norge Infrastructure owns Arctic Norge Data I AS (formerly Nordland Data AS) (“Arctic Norge Data”), which operates our data center in Mo i Rana, Norway. VivoPower Norge Infrastructure and Arctic Norge Data changed their names in October 2026. Where this Annual Report refers to events, agreements or filings that predate the name changes, including the Hosting Agreement and the Norwegian tax matter described in Item 3.D, the entities are referred to by their current names, and their former names, Cromwell AS and Nordland Data AS, appear in the underlying documents.
Certain amounts and percentages that appear in this Annual Report have been subject to rounding adjustments. As a result, certain numerical figures shown as totals, including in tables, may not be exact arithmetic aggregations of the figures that precede or follow them.
Forward-Looking Statements
This Annual Report contains forward-looking statements within the meaning of the federal securities laws, which statements involve substantial risks and uncertainties. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions. Forward-looking statements contained in this Annual Report include, but are not limited to, statements about:
| ● | our expectations regarding our revenue, expenses and other results of operations; our plans to convert the Mo i Rana data center from hosting of Bitcoin mining to AI-grade data center infrastructure, including the timing, cost and technical requirements of the conversion; | |
| ● | our ability to enter into a definitive lease with an AI tenant for the Mo i Rana data center on commercially acceptable terms; | |
| ● | our expectations regarding revenue from our existing hosting agreement during the conversion period; | |
| ● | our ability to identify, secure and develop additional powered land and data center sites; | |
| ● | our plans to acquire, invest in, develop or sell our investments in energy projects or joint ventures or in the electric vehicle sector; | |
| ● | our ability to attract and retain customers; | |
| ● | the growth rates of the markets in which we compete; | |
| ● | our liquidity and working capital requirements; | |
| ● | our ability to raise sufficient capital to realize development opportunities and thereby generate revenue; | |
| ● | our ability to pay the deferred cash consideration for the Mo i Rana acquisition when due; | |
| ● | our anticipated strategies for growth; | |
| ● | our ability to anticipate market needs and develop new and enhanced solutions to meet those needs; | |
| ● | anticipated trends and challenges in our business and in the markets in which we operate; | |
| ● | our expectations regarding the demand for electric vehicle conversion kits; | |
| ● | our expectations regarding changes in the cost of materials for electric vehicle conversion kits; | |
| ● | our expectations regarding the demand for solar power by energy users or investors in projects; | |
| ● | changes in Norwegian and other laws and regulations that apply to data centers; | |
| ● | our ability to compete in our industry and innovation by our competitors; | |
| ● | our ability to develop competitive electric vehicle products and build scalable assembly processes; | |
| ● | the extent to which events with a global impact on supply chains, such as pandemics or wars, affect our business, financial condition and results of operations; | |
| ● | our expectations regarding our ongoing legal proceedings; | |
| ● | our ability to adequately protect our intellectual property; and | |
| ● | our plans to pursue strategic acquisitions. |
We caution that the preceding list may not contain all the forward-looking statements made in this Annual Report.
You should not rely upon forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this Annual Report primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, operating results and prospects. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties and other factors described in the “Item 3. Key Information - D. Risk Factors.” Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Annual Report. We cannot assure you that the results, events and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements.
The forward-looking statements made in this Annual Report relate only to events as of the date on which the statements are made. We undertake no obligation to update any forward-looking statements made in this Annual Report to reflect events or circumstances after the date of this Annual Report or to reflect new information or the occurrence of unanticipated events, except as required by law. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments we may make.
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PART I
ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS
Not applicable.
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE
Not applicable.
ITEM 3. KEY INFORMATION
A. Selected Financial Data
Our historical consolidated financial statements are prepared in accordance with IFRS and are presented in U.S. dollars. The selected historical consolidated financial information set forth elsewhere in this Annual Report has been derived from, and is qualified in its entirety by reference to, our historical consolidated financial statements for the periods presented. Historical information as of and for the years ended June 30, 2026, 2025, and 2024, is derived from, and is qualified in its entirety by reference to, our consolidated financial statements (the “financial statements”). Unless otherwise indicated, all references to “financial statements” herein refer to our consolidated financial statements. Our financial statements as of and for the years ended June 30, 2026 and 2025 have been audited by WithumSmith+Brown, PC, our independent registered public accounting firm. Our financial statements for the year ended June 30, 2024 were audited by PKF Littlejohn LLP. We have restated the comparative financial information for the year ended June 30, 2025, as described in Note 35 to our financial statements. You should read this information together with our audited financial statements, the related notes and “Item 5. Operating and Financial Review and Prospects” included elsewhere in this Annual Report.
B. Capitalization and Indebtedness
Not applicable.
C. Reasons for the Offer and Use of Proceeds
Not applicable.
D. Risk Factors
Investment in our shares involves a high degree of risk and our business faces significant risk and uncertainty. You should carefully consider the following information, together with the other information in this Annual Report and in other documents we file with or furnish to the U.S. Securities and Exchange Commission (the “SEC”), before deciding to invest in or maintain an investment in any of our securities. Our business, as well as our financial condition or results of operations could be materially and adversely affected by any of these risks, as well as other risks and uncertainties not currently known to us or not currently considered material. The market price of our shares could decline as a result of any of these risks or uncertainties, and you could lose all or part of your investment.
Risks related to our business and operations
We have limited operating history as a standalone data center platform focused on AI infrastructure.
The Group is in the process of transitioning from a diversified sustainable energy solutions company to a Nordic-focused digital infrastructure platform delivering power-secured data centers for artificial intelligence (“AI”) and high-performance computing (“HPC”) workloads. This strategic pivot involves a fundamental change in the Group’s business model, target markets, customer base and operational focus. In May 2026, the Group completed the acquisition of VivoPower Norge Infrastructure AS and its subsidiary Arctic Norge Data I AS (fka Cromwell AS and Nordland Data AS), the entities that own and operate the hydro-powered data center facility located at Mo Industripark in Mo i Rana, Norway (the “Mo i Rana Facility”), for a headline value of US$ 37.7 million (being an upfront cash payment of US$ 20.9 million, 1,507,353 Class A Ordinary Shares issued at US$ 6.80 per share and 1,055,147 warrants, with deferred cash consideration of US$ 5.0 million payable in November 2026 and US$ 5.1 million payable in May 2027) (the “Acquisition”). The acquisition-date fair value of the consideration transferred, as recognized in the Group’s financial statements, was US$ 37.7 million (see Note 14). The Group’s data center operations are currently limited to the Mo i Rana Facility, with 41.5 megawatt (“MW”) of capacity, which is anticipated to be converted from hosting of Bitcoin mining to AI-grade infrastructure. Investors will therefore have limited historical information on which to evaluate the Group’s performance, business model, financial development and ability to execute its strategy as a data center platform. The Group may face challenges in establishing and managing the business within the new strategic direction, including with respect to organization, internal controls, project prioritization, customer acquisition and strategic execution. Any such circumstances could have a material adverse effect on the Group’s business, financial condition, results of operations and prospects. The Group has no established track record of winning, onboarding or retaining hyperscaler or sovereign AI tenants at the rental levels targeted by its business model.
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The Group’s business model depends on its ability to develop and commercialize data center projects and operate data center infrastructure. The Group’s project development activities include identifying and securing suitable sites with grid access, developing such sites through zoning, permitting and power connection processes, and seeking to realize value through long-term lease agreements with hyperscalers, sovereign AI customers or colocation operators, or through refinancing of stabilized assets. The Group’s operational activities currently comprise a limited part of the Group’s business, consisting primarily of the Mo i Rana Facility. The risks relevant to these activities differ. Project development activities are primarily exposed to risks relating to site access, land rights, permits, zoning, grid connection and capacity, power availability, construction costs, regulatory requirements and the ability to secure tenants, while operational activities are exposed to risks relating to customers, uptime, technical failures, cyber security and compliance with operational requirements.
Demand for data center capacity and AI infrastructure may be lower than expected. The Group’s business depends on continued and growing demand for data center capacity, particularly from hyperscalers, sovereign AI programs and AI cloud operators. According to McKinsey & Company, under current adoption scenarios, global data center demand could almost triple between 2025 and 2030, from about 82 GW to about 220 GW (McKinsey Global Institute, “Colocation data centers: The infrastructure race behind AI,” June 30, 2026. However, demand may be affected by macroeconomic developments, changes in AI investment cycles, technological developments that reduce compute requirements, increased competition from other data center developers, regulatory developments, energy price volatility, or customers choosing to develop their own facilities rather than leasing powered shell capacity. If demand for data center projects or AI infrastructure capacity is lower than expected, the Group may be unable to commercialize its projects or secure tenants on the terms or within the timeframe anticipated. This may result in delayed projects, lower valuations, reduced revenues or reduced ability to attract commercial partners, which could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
We face competition in the markets, industries and business segments in which we operate, which could adversely affect our business, operating results, financial condition and future prospects.
We face competition in each of the business segments and jurisdictions in which we operate particularly in the rapidly evolving market for data center development and AI infrastructure. We compete with established Nordic data center operators such as Green Mountain, Lefdal Mine Data center and AQ Compute, as well as global developers and sovereign-backed infrastructure funds, for access to grid-connected sites, power capacity, construction resources, tenants and financing. Several of the Group’s competitors have substantially greater financial resources, larger scale, longer operating track records and technical capabilities than the Group. In addition, hyperscalers may choose to develop their own data center facilities rather than leasing powered shell capacity from third-party developers. The market is also experiencing increased competition as new entrants, including energy companies, real estate developers and infrastructure funds, seek to enter the data center market in response to growing demand for AI compute capacity. If we are unable to compete effectively, or if competitive dynamics result in lower rental levels, reduced occupancy or increased development costs, this could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
Some of our competitors (i) have more financial, technological, engineering and manufacturing resources than we do to develop products, services and solutions that may compete favorably against our products; (ii) are developing or are currently producing products, services and solutions based on new technologies that may ultimately have costs similar to or lower than ours; (iii) have government-backed financial resources or parent companies with greater depths of resources than are available to us; (iv) have access to a lower cost of capital than we do; (v) have stronger distribution partnerships and channels than we do, enabling access to larger customer bases; and (vi) may have longer operating histories, greater name and brand recognition and greater economies of scale than we do.
In addition, new competitors or alliances among existing competitors could emerge and rapidly acquire significant market share, adversely impacting our business in the process.
We expect that our competitors will continuously innovate to improve their ability to deliver products, services and solutions to meet customer demands. Should we fail to compete effectively, this could have a material adverse effect on our business, results of operations and financial condition.
Our current operational exposure is concentrated in one facility and a limited number of revenue sources.
The Group’s current operational activities are concentrated in a single facility at Mo i Rana, Norway, with 41.5 MW of operating capacity. The facility currently generates revenue from Bitcoin mining hosting and a 30% share of the compute power under a Hosting and Maintenance Services Agreement dated May 21,2024 between our subsidiary Arctic Norge Data I AS (formerly Nordland Data AS) and Corner Norway AS (the “Hosting Agreement”). The Hosting Agreement has a term of 36 months from the deployment date (the date the equipment was fully deployed), which the Group expects to expire in or around July 2027 and contains no option to renew.
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The Group is in the process of converting this facility from hosting of Bitcoin mining to AI-grade data center capacity. The Group has conducted a competitive request for proposal (“RFP”) process to identify and select an AI tenant for the Mo i Rana Facility. As at the date of this Annual Report, the Group is no longer pursuing a lease with the tenant previously announced as preferred and is finalizing terms with another prospective tenant. No binding tenant agreement has been concluded and no assurance can be given that those discussions will result in a binding agreement. If this conversion is not completed and a replacement AI tenant agreement is not executed before the Hosting Agreement expires, or if the conversion is completed but the new tenant does not commence paying rent before the Hosting Agreement terminates, the Group will face a period without revenue from its sole operational facility. Even if an AI tenant is secured, there may be a lag between the expiry of the Hosting Agreement and the commencement of revenue from the new arrangement. Any loss of the current revenue stream before a replacement tenant is secured, any delay in the conversion process, any failure to secure an AI tenant on acceptable terms, any operational disruption at the facility, or any revenue gap during the transition period could have a disproportionate impact on the Group’s revenue and financial position. Since the Group currently has limited operational diversification, adverse developments relating to this single facility or its key commercial relationships could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
The conversion of the Mo i Rana facility from hosting of Bitcoin mining to AI infrastructure involves significant execution risk.
Our near-term value creation strategy depends on the successful conversion of our 41.5 MW operational facility in Mo i Rana from hosting of Bitcoin mining to AI-grade data center infrastructure. The conversion requires substantial capital expenditure for infrastructure upgrades to meet the power density, cooling, redundancy and connectivity requirements of AI workloads. The conversion process may face delays, cost overruns, technical challenges or supply chain bottlenecks. In addition, the converted facility may not meet the technical specifications required by prospective AI tenants, and we may not be able to secure a tenant on commercially acceptable terms. We are no longer pursuing a lease with the tenant we announced as preferred on June 29, 2026, and are finalizing terms with another prospective tenant. No definitive lease has been signed, and we cannot assure you that one will be concluded. During the conversion period, revenue from hosting of Bitcoin mining may be reduced or eliminated before AI leasing revenue is generated, which could affect our cash flow during the transition period. We cannot assure you that the conversion will be completed on the anticipated timeline, within budget, or at all. Any delay, cost overrun or failure in the conversion process could have a material adverse effect on our business, financial condition, results of operations, cash flows and prospects.
LIAN Group’s position as a significant shareholder, deferred consideration creditor and warrant holder gives rise to potential conflicts of interest.
In connection with the Mo i Rana Acquisition, which completed on May 12, 2026, VivoPower issued 1,507,353 Class A Ordinary Shares to LIAN Group at a price of US$ 6.80 per share. LIAN Group was also issued a warrant over 1,055,147 ordinary shares, which it exercised on a cashless basis on 17 June 2026 for 1,054,963 ordinary shares. As a result, LIAN Group holds 2,562,316 Class A Ordinary Shares, representing approximately 8.3% of the Company’s issued share capital as of June 30, 2026.
Although the acquisition of Cromwell AS has completed, LIAN Group remains a significant shareholder and a creditor of the Group in respect of outstanding deferred cash consideration of US$ 5.0 million due on or around November 2026 and US$ 5.2 million due on or around May 2027. This combination of roles, as a shareholder, and a deferred consideration creditor creates potential conflicts between LIAN Group’s interests and those of other shareholders of the Company. Any of the foregoing could have a material adverse effect on the governance of the Group and the interests of minority shareholders.
We depend on third-party delivery partners to build powered shells.
Our business model involves outsourcing the construction of powered shell data centers to specialist engineering, procurement and construction (“EPC”) firms and other delivery partners, including CTS Group and Jones Engineering. At Mo i Rana, we have engaged Øijord & Aanes Entreprenørforretning AS to deliver the conversion site works, and we have conducted a tender review process for the mechanical and electrical fit-out, which has not yet been awarded. Our execution strategy and project delivery timelines depend on the performance, capacity, financial position and continued availability of these third parties. CTS Group, our preferred construction partner, has been selected to design and construct powered shell facilities for our projects. If our delivery partners fail to perform, experience capacity constraints, delay their deliveries, increase their pricing, or are unable to provide services on acceptable terms, our project construction may be delayed or cost overruns may occur, which could affect our ability to commercialize projects as planned. Our reliance on a limited number of preferred delivery partners also creates concentration risk. Any such circumstances could have a material adverse effect on our business, financial condition, results of operations, cash flows and prospects.
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We may be adversely affected by rapid technological change in the AI and data center industry.
The AI and data center industry is characterized by rapid technological evolution, including changes in GPU architectures, cooling requirements, power density specifications, rack configurations and networking protocols. We seek to mitigate technology obsolescence risk by providing infrastructure rather than compute capacity, with tenants responsible for installing and maintaining their own IT equipment. However, our powered shell designs must be compatible with current and anticipated hardware specifications, including with respect to power density (currently targeting 50-100+ kW per rack for AI workloads), liquid cooling infrastructure, redundancy levels and fiber connectivity. Changes in these requirements could require us to modify its facility designs or make additional capital investments, particularly at the Mo i Rana facility where the conversion from hosting of Bitcoin mining infrastructure to AI-grade specifications must be completed. Our design specifications for AI workloads have not yet been contractually confirmed. Furthermore, breakthroughs in AI efficiency that materially reduce compute requirements, or the emergence of alternative computing paradigms such as edge computing or optical processing, could reduce overall demand for large-scale AI data centers. If we are unable to adapt our infrastructure offerings to evolving technological requirements, this could have a material adverse effect on our business, financial condition, results of operations, cash flows and prospects.
Our inability to protect our intellectual property and trade secrets could adversely affect our business. We may also be subject to intellectual property rights claims by third parties, which are extremely costly to defend, could require us to pay significant damages and could limit our ability to use certain technologies.
Any failure to protect our proprietary rights adequately could result in our competitors using our know-how, designs or brand, or offering similar data center infrastructure solutions more quickly than anticipated. This could cause us to lose some of our competitive advantage and reduce our revenue, which would adversely affect our business prospects, financial condition and results of operations. Our success depends, at least in part, on our ability to protect our proprietary technology, know-how, project designs and brand. We rely on intellectual property laws, primarily a combination of copyright and trade secret laws in the jurisdictions in which we operate, as well as license agreements, confidentiality provisions and other contractual arrangements, to protect our proprietary rights. We cannot be certain that our agreements and other contractual provisions will not be breached, including a breach involving the use or disclosure of our trade secrets or know-how, or that adequate remedies will be available in the event of any breach. In addition, our trade secrets may otherwise become known or lose trade secret protection.
We cannot be certain that our products and our business do not or will not violate the intellectual property rights of a third party. Third parties, including our competitors, may own patents or other intellectual property rights that cover aspects of our technology or business methods. Such parties may claim we have misappropriated, misused, violated or infringed upon third-party intellectual property rights and if we gain greater recognition in the market, we face a higher risk of being the subject of claims we have violated others’ intellectual property rights. Any claim we violated a third party’s intellectual property rights, whether with or without merit, could be time-consuming, expensive to settle or litigate and could divert our management’s attention and other resources, all of which could adversely affect our business, results of operations, financial condition and cash flows. If we do not successfully settle or defend an intellectual property claim, we could be liable for significant monetary damages and could be prohibited from continuing to use certain technology, business methods, content or brands. To avoid a prohibition, we could seek a license from third parties, which could require us to pay significant royalties, increasing our operating expenses. If a license is not available at all or not available on commercially reasonable terms, we may be required to develop or license a non-violating alternative, either of which could adversely affect our business, results of operations, financial condition and cash flows.
Our brand and reputation are key assets of our business, and if our brand or reputation is damaged, our business and results of operations could be materially adversely affected.
If we fail to deliver our data center projects, including the conversion of our Mo i Rana facility, within planned timelines, budgets and contracted obligations, or if our facilities and services do not perform as anticipated, or if we materially damage any of our customers’ or counterparties’ property, or cancel projects, our brand name and reputation could be significantly impaired. The same risk applies to the products and services of Tembo, our subsidiary, including its battery-electric conversion kits and electric vehicle products. If customers, prospective tenants, lenders, investors or other counterparties have or develop a less favorable view of our brand or reputation, for the reasons stated above or for any other reason, it could materially adversely affect our business, results of operations and financial condition.
The planned carve out via a reverse merger of Tembo with a special purpose acquisition company is subject to certain outstanding regulatory approvals from the SEC, which could affect the timing of completion and, if not obtained, could adversely affect the Group’s business, financial condition, results of operations and prospects.
The Group’s subsidiary Tembo has entered into a Business Combination Agreement for a business combination with Cactus Acquisition Corp. 1 Limited (“CCTS”), a special purpose acquisition company. Upon completion of the transaction, Tembo will become a separately listed entity trading on Nasdaq, and the Group will retain a minority holding of the shares in the combined entity.
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A registration statement on Form F-4 has been filed confidentially with the U.S. Securities and Exchange Commission (the “SEC”). The SEC has issued comments on the filing with final SEC approval pending. If the SEC issues additional comments, or if the SEC does not declare the Form F-4 effective in a timely manner, further rounds of comments may be required, or the SEC may request material amendments to the registration statement. Until the Form F-4 is declared effective by the SEC, the shareholder meeting of CCTS to approve the transaction cannot be scheduled or held. The timetable for the transaction has already been extended beyond our original expectations, principally due to delays on the part of CCTS’s independent auditors, who are based in Israel and whose team members were affected by the regional conflict, and further delays may occur.
Any delay in obtaining SEC effectiveness, or any failure to obtain it, could adversely affect our ability to realize value from its investment in Tembo, Tembo’s ability to secure additional financing, and the execution of the Group’s strategy. If the transaction does not complete, we will be required to explore alternative strategies to support Tembo’s growth and meet its operational and financial objectives, which may include raising equity or debt financing, or seeking alternative strategic partners, which may not be available on acceptable terms or at all.
In addition, for so long as the transaction has not completed, Tembo continues to be consolidated within the Group’s financial statements, and Tembo’s liabilities, losses and cash requirements will continue to affect the Group’s consolidated financial condition. Furthermore, factors such as market sentiment, regulatory developments and legal exposures relating to the business combination may influence the Company’s share price, potentially leading to volatility or a reduction in share value.
Following the Tembo de-SPAC, Tembo will operate as a separately listed entity with its own board of directors, management team and strategic priorities. As a result, the Group’s ability to direct Tembo’s business and operations will be materially reduced compared to its current position as Tembo’s parent company. The expected benefits of the business combination may not be realized, and the Group’s business, operations or financial results could be adversely affected.
Our minority stake in Tembo following the de-SPAC transaction involves significant risks, and the resulting minority position will limit the Group’s ability to control or influence Tembo’s business.
In connection with the Tembo de-SPAC, we will retain a minority holding of the shares in the new listed entity. At this ownership level, we will not hold a controlling interest in Tembo and will be unable to control or direct Tembo’s management appointments, capital allocation or financial decisions. Tembo’s board of directors and management team will be responsible for the day-to-day management and strategic direction of Tembo, and their decisions may not align with our interests or strategic priorities. As a minority shareholder, we may be unable to prevent Tembo from taking actions that we consider detrimental to its interests, including the issuance of additional shares (which would dilute our stake), the incurrence of indebtedness, changes in business strategy, entry into related-party transactions, or distributions to shareholders. Our ability to protect its investment will depend on applicable law and the governance arrangements in place following the Tembo de-SPAC, and such arrangements may not provide the Group with sufficient protective rights. Any of the foregoing could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
Sanctions and anti-money laundering risks associated with our hosting of Bitcoin mining operations.
The Group currently hosts a Bitcoin mining facility at Mo i Rana, Norway, which is expected to continue generating revenue from Bitcoin mining during the transition period prior to conversion. In hosting Bitcoin mining, the facility participates in mining pools where pool participants are identified only by blockchain wallet addresses, and the identity of the underlying beneficial owner is not disclosed to other pool participants. As a result, the Group may unknowingly participate in mining pools with entities or individuals designated as Specially Designated Nationals (“SDNs”) or otherwise subject to sanctions administered by the U.S. Office of Foreign Assets Control (“OFAC”), the UK Office of Financial Sanctions Implementation (“OFSI”), the European Union or other applicable authorities.
Although the Group does not believe that its mining pool participation gives rise to a direct transactional relationship with individual pool participants, sanctions regulators, including OFAC, have taken expansive views of sanctions enforcement and could assert jurisdiction on the basis of strict liability, without requiring knowledge or intent on the part of the counterparty. The Group’s current compliance procedures may be insufficient to identify or prevent all potential sanctions exposures, and new sanctions rules or regulatory guidance could increase the Group’s compliance burden or exposure.
Any finding that we have violated applicable sanctions laws could result in significant fines, reputational damage, restrictions on the Group’s ability to operate in certain jurisdictions, and potential secondary sanctions consequences. This risk is expected to diminish materially following the completion of the conversion of the Mo i Rana facility to AI/HPC colocation and the cessation of hosting of Bitcoin mining operations.
The Group may not maintain adequate insurance coverage for its operations, assets and directors and officers
The Group operates data center infrastructure in Norway, holds significant contractual commitments and financial obligations (including under the power hedging arrangements and the the deferred consideration payable under the Mo i Rana Acquisition), and is in the process of developing new data center facilities across multiple jurisdictions. Adequate insurance coverage against operational risks, property damage, business interruption, environmental liability, and directors’ and officers’ (“D&O”) liability is an important element of the Group’s risk management. The Group’s current insurance arrangements reflect its existing operational profile as a Bitcoin mining hosting business. A number of insurance lines that will become necessary as the Group converts the Mo i Rana Facility to AI-grade infrastructure and develops its broader project portfolio are not yet in place, and the Group will need to put these in place as its activities evolve.
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As at the date of this filing, the Group is working with its insurance brokers to expand its coverage across (i) D&O liability; (ii) cyber insurance; (iii) business interruption beyond fire-related disruption; and (iv) environmental or pollution liability insurance, in each case to reflect the increased activity and scale of the Group as it converts the Mo i Rana Facility to AI-grade infrastructure and develops its broader project portfolio. Until that expanded coverage is in place, the Group remains exposed to uninsured or underinsured losses in the event of a cyber incident, broader business interruption, incident, or personal liability claim against directors and officers. Any such uninsured loss could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
Risks related to the Group’s project development.
Our business depends on the successful development and commercialization of a project portfolio that includes those that are at an early stage, and delays or failures may have a disproportionate effect on the Group.
The Group’s business and expected value creation are dependent on the successful origination, development and commercialization of its project portfolio, which currently comprises one operational site (Mo i Rana) and a pipeline of projects across multiple jurisdictions. Several of the Group’s key pipeline projects are in early stages of development and subject to significant conditions, including land acquisition, zoning approvals, grid capacity reservations, environmental permits, power availability, commercial interest and timing. Because the Group currently has a relatively limited operational portfolio, delays, cost increases, disputes or failure to progress one or more key projects could have a disproportionate impact on the Group’s financial position, growth trajectory and value creation. There is a risk that the Group will be unable to mature its existing projects in line with current plans or replace delayed or discontinued projects with new opportunities on acceptable terms. Any such circumstances could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
We may not be able to identify, secure and maintain access to suitable sites with adequate grid capacity on commercially acceptable terms.
Our project development activities depend on our ability to identify and secure suitable sites for data center development that satisfy requirements including access to sufficient land, grid connection capacity, renewable power sources, fiber connectivity, favorable zoning status, technical feasibility and commercially acceptable terms. Grid access is among the most critical inputs in the AI data center value chain, and competition for grid-connected sites in preferred locations, such as the Nordics, is intense. Grid connection lead times vary widely by market and can be significantly shorter in the Nordics than in congested European hubs. According to Ember, new data centers in established European hubs such as Frankfurt, London, Amsterdam, Paris and Dublin wait an average of seven to ten years to connect to the grid (Ember, “Grids for data centres in Europe”). However, we may be unable to secure grid capacity on the timescales or on the commercial terms we assume. Grid allocation criteria may become more stringent over time, and queues for grid capacity may be extensive. If we are unable to secure and maintain access to suitable sites with adequate grid capacity on commercially acceptable terms, this would severely restrict the growth of our project portfolio and could have a material adverse effect on our business, financial condition, results of operations, cash flows and prospects.
Project costs may increase materially, and projects may not remain commercially viable.
The commercial viability of the Group’s projects depends on a number of assumptions, including land costs, build costs, construction timelines (targeting 12-15 months site delivery), financing availability and expected rental levels from tenants. These assumptions may prove incorrect.
Construction and development costs are subject to a number of factors outside the Group’s control, including inflation in labor and materials costs, contractor availability, and changes in applicable building standards or environmental regulations. Key power equipment, such as high-voltage transformers, power distribution units and specialist cooling systems have resulted in significant procurement delays and cost increases in recent years, and such constraints may persist or worsen due to global demand driven by accelerating global data center construction activity, and the Group may be unable to procure the necessary equipment on the timescales or at the costs assumed in its project models.
Grid connection costs, technical requirements and regulatory compliance costs may increase materially during the development phase. The Group’s capital recycling model assumes a development value uplift target of approximately 5x, but actual project economics may differ significantly from these targets. If costs increase, timelines are extended or project specifications must be changed, a project may become less attractive or unviable, which could lead to project cancellations, write-downs or reduced margins, with a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
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The Group may not be able to secure tenants for its data center facilities on acceptable terms.
The Group’s business model is predicated on securing long-term lease agreements (10-15 years) with hyperscalers, sovereign AI customers or colocation operators for its powered shell data center facilities. The Group’s ability to commercialise its projects depends on its ability to attract and retain such tenants on commercially acceptable terms. The Group may not be able to secure tenants for its current or future facilities, and tenants may not be willing to enter into lease agreements on the terms or at the rental levels assumed in the Group’s business model. The Group is currently in discussions with AI operators for the Mo i Rana facility, but no binding lease agreement has been signed, and the conversion of the facility to AI compute, and the value of our investment in the Mo i Rana Acquisition, depend substantially on our entering into such a lease. If the Group is unable to secure tenants at the expected time, rental level or terms, this could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
Under applicable insolvency legislation, including Norwegian law, a tenant that commences insolvency or debt restructuring proceedings may be able to remain in occupation of the Group’s facility while restructuring its obligations, or may disclaim the lease, delaying the Group from terminating the lease and re-letting the facility to a replacement tenant. Given that Mo i Rana currently represents the Group’s sole operational facility, any such delay in re-letting or loss of rental income could have a disproportionate impact on the Group’s operational cash flow and its financial condition generally.
Our pipeline spans multiple jurisdictions, exposing it to diverse regulatory, political and operational risks.
The Group’s project pipeline spans multiple jurisdictions, each with its own regulatory framework, permitting requirements, grid connection rules, land ownership restrictions and tax regimes. Developing and operating projects in these jurisdictions may depend on obtaining and maintaining appropriate licenses, permits and local partnerships. Many of these jurisdictions have complex administrative procedures, long approval cycles and shifting regulatory or authority practices. The development of data center projects in these jurisdictions may be affected by changes in laws, regulations, political priorities, energy policy, security requirements or public sentiment regarding data center energy consumption. In the UAE, local ownership rules may restrict foreign ownership of land and certain business activities, and the Group’s ability to develop and operate projects in the UAE may be subject to change, and the availability of competitively priced power (targeted at <5c/kWh wholesale) remains subject to final contract and regulatory approval. In the Nordic markets, political and regulatory focus on data center energy consumption, sustainability requirements and grid capacity allocation may result in more restrictive permitting conditions, moratoriums on grid connections or priority allocation to other industries. For example, certain Norwegian municipalities have introduced requirements for municipal approval of large-scale data center developments, and similar regulatory developments may occur in Finland and Denmark. The Group’s ability to develop projects across multiple jurisdictions requires significant management attention and resources, and the Group may face challenges in navigating diverse regulatory environments with a relatively small organization. Any such circumstances could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
Our data center operations may be disrupted by technical failures, cyber incidents or security breaches, which could result in service interruptions, contractual claims and reputational harm.
Operational disruptions, cyber incidents or security breaches may adversely affect the Group’s operating activities. The Group’s current operational activities are limited to the Mo i Rana facility, which is currently undergoing conversion from hosting of Bitcoin mining to AI infrastructure. The facility’s existing infrastructure was originally designed for Bitcoin mining workloads, which have materially different redundancy, cooling and uptime requirements compared to AI/HPC colocation. The conversion requires significant upgrades to power density, cooling systems, fire suppression, physical security and network connectivity to meet the specifications required by AI tenants, who typically demand uptime levels of 99.99% or above and may impose significant financial penalties for service interruptions. During and after the conversion, the Group may experience outages or disruptions caused by power failures, cooling failures, mechanical breakdowns, fire, flooding, human error, software glitches, cyberattacks, sabotage or failure of telecom providers. The Mo i Rana facility’s location in northern Norway also presents specific operational considerations, including exposure to extreme weather conditions, reliance on a limited number of regional grid connections, and logistics constraints for hardware delivery and specialist equipment. Any failure to maintain adequate operational resilience could result in service interruptions, contractual claims, customer terminations, increased costs, reputational harm or rejection by prospective tenants, any of which could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
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Our operations are dependent on reliable and affordable power supply.
Our data center operations and development activities are fundamentally dependent on access to reliable, affordable and scalable power supply. Our business model targets access to low-cost renewable power, with a target wholesale power price below US$0.05 per kWh in Nordic markets, which we believe provides a competitive advantage relative to data center markets with higher energy costs. However, power may not remain available at these price levels. Power prices in the Nordics and our other target markets are subject to seasonal variations, weather conditions, hydrological balances, carbon pricing, regulatory changes and broader European energy market dynamics. The Mo i Rana facility currently benefits from favorable power pricing in northern Norway (NO4 price area), but changes in transmission capacity between price areas, the introduction of power export tariffs, increased local industrial users or data center operators, or regulatory changes affecting power allocation could adversely affect our access to competitively priced power. In particular, effective July 1, 2026, Finland moved electricity used in data centers from the reduced electricity tax category II (0.05 euro cents per kWh) to the general category I (2.24 euro cents per kWh), an increase of 2.19 euro cents per kWh. This materially affects the power cost economics of our Finnish pipeline described in Item 4. We are not aware of any transitional or grandfathering provision for sites in development before that date. The Finnish government has previously stated that it intended to introduce a compensation scheme, but we are not aware of any such scheme being in force, and we cannot assure you that one will be introduced or that we would qualify. In addition, our pipeline projects in other jurisdictions may be subject to different power market structures, tariff regimes, grid transmission fees or regulatory changes. Any material increase in power costs, reduction in power availability or disruption to power supply could reduce the commercial viability of our projects, increase our operating costs or make our facilities less competitive relative to alternative markets, with a material adverse effect on our business, financial condition, results of operations, cash flows and prospects.
Our operating and development activities may be subject to uncertainty relating to building, zoning and use permits.
The use of existing buildings and premises for data center operations, and the development of new data center sites, may depend on zoning, building permits, use permits, environmental approvals and other administrative authorizations. Municipal authorities may change zoning plans, delay permit approvals, or impose onerous conditions. Recent legal developments have clarified that data centers may not be developed under certain existing zoning categories, which may limit the number of sites available for development. Several European jurisdictions have imposed temporary moratoriums or restrictions on new data center connections, and similar restrictions could be introduced in the Nordic markets in the future. Furthermore, data centers are subject to increasing environmental regulation, including ESG requirements, heat reuse obligations, water consumption limits, sustainability reporting and climate-related impacts. New laws, regulations or administrative practices may require the Group to make additional investments, change the design or operation of its facilities, or delay project execution to comply with environmental requirements. Any such circumstances could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
The Group is subject to data protection, cybersecurity and digital resilience requirements
The Group operates data center infrastructure that may be classified as critical infrastructure or essential services under applicable national security and digital resilience frameworks. As the Group’s facilities are designed to host AI workloads for hyperscalers, sovereign AI programs and other operators processing potentially sensitive data, the Group may become subject to enhanced regulatory requirements relating to data sovereignty, security clearance, ownership restrictions and operational resilience. In Norway, data centers hosting certain categories of data may be subject to requirements under the Norwegian Security Act (Sikkerhetsloven) and related regulations, which could impose obligations regarding ownership structures, personnel vetting, physical security and reporting to national authorities. The EU’s NIS2 Directive and the Digital Operational Resilience Act (DORA) may also impose additional cybersecurity and incident reporting obligations on the Group or its tenants. The Group processes personal data relating to employees, contractors and business contacts and is subject to the EU General Data Protection Regulation (GDPR) and applicable national implementations. Any failure to comply with applicable data protection, cybersecurity or critical infrastructure requirements, or any material cyber incident, data breach or systems failure, could result in regulatory scrutiny, fines, claims, restrictions on operations, loss of tenant confidence and reputational damage, which could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
We are exposed to supply chain concentration risk in respect of critical hardware and equipment.
The successful conversion and operation of our data center facilities for AI workloads depends on the availability of high-performance computing hardware and data center infrastructure equipment. Our powered shell business model does not require us to purchase or provide GPUs. However, prospective AI tenants require assurance of GPU availability before entering into long-term lease commitments. The global market for advanced AI GPUs, particularly NVIDIA A100, H100 and successor architectures, is characterized by demand that materially exceeds available supply, long delivery lead times and high market concentration. If our prospective tenants are unable to secure GPU allocation from hardware manufacturers or cloud providers, they may delay or cancel their leasing commitments.
We do depend on critical data center infrastructure equipment, such as transformers, diesel generators, chillers, liquid cooling components, switchgear and networking equipment, which faces extended manufacturing lead times and global supply chain bottlenecks. Any delay in procuring this equipment could delay site construction, extend conversion timelines or increase project costs, affecting our ability to deliver facilities to tenants’ specifications within the anticipated timelines, at competitive pricing or at all. Our reliance on a limited number of equipment suppliers creates supply chain concentration risk. Any supply constraint, allocation prioritization in favor of larger customers, vendor pricing changes, export control restrictions or geopolitical disruption affecting the supply of critical equipment or our tenants’ hardware could delay project execution, increase our capital costs or make our facilities less competitive relative to well-capitalized alternatives. Any such circumstances could have a material adverse effect on our business, financial condition, results of operations, cash flows and prospects.
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Financial risks
The Group has limited financial history in its new strategic direction and its revenues may be unstable and difficult to predict.
The Group has limited financial history in its new strategic direction, and its revenues may be unstable and difficult to predict. The Group is undergoing a fundamental strategic transition, shifting its operational focus from electric utility vehicles, solar development and custom electrical engineering toward operating as a Nordic-focused data center infrastructure platform, while retaining a strategic minority stake in Tembo in connection with the Tembo de-SPAC. The Group’s historical financial results, which reflect its historical activities in electric vehicles and solar development, are not indicative of its future performance as a data center platform.
On an unaudited pro forma basis, VivoPower Norge Infrastructure (formerly Cromwell AS) and Arctic Norge Data I AS (formerly Nordland Data AS), taken together, had revenue of US$23.6 million, EBITDA of US$6.0 million and net income of US$2.6 million for the year ended December 31, 2025, derived primarily from hosting bitcoin mining operations at the Mo i Rana facility. These figures are derived from the entities’ Norwegian GAAP accounts, adjusted to IFRS and then for pro forma adjustments that add mining and profit-share revenue earned under the hosting arrangement, transfer net power hedge costs and reverse related-party recharges. Before the pro forma adjustments, on an IFRS basis, they had revenue of US$11.4 million, EBITDA of US$2.6 million and a net loss of US$0.8 million. EBITDA is a non-IFRS measure, reconciled to net income in [Item 5]. These results reflect performance before the Mo i Rana Acquisition and before the conversion of the facility to AI/HPC colocation began. They do not reflect the future revenue profile of the facility following conversion, and you should not place undue reliance on them as a guide to future performance.
Revenue from the Group’s data center leasing activities will be dependent on the successful conversion of the Mo i Rana facility and the development and leasing of pipeline projects, the timing and terms of which are uncertain. Revenue from Tembo will be subject to Tembo’s operational and financial performance as a separately listed entity, over which the Group will have limited control as a minority shareholder. There may be periods during which the Group incurs significant operating expenses, project development costs and capital expenditure without corresponding revenue from its new strategic direction. Any such circumstances could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
We require additional financing to execute our strategy to operate and grow our business and additional requisite funding may not be available to us when we need or want it.
Our operations and our future plans for expansion, including the conversion of the Mo i Rana facility to AI-grade data center infrastructure, could require significant operating expenditures and capital expenditures to realize the growth potential of our data center, electric vehicle and sustainable energy solutions businesses. In addition, we are subject to substantial and ongoing administrative and related expenses required to operate and grow a public company. Together these items impose substantial requirements on our cash flow and the specific timing of cash inflows and outflows may fluctuate substantially from period to period. As a result, we require a combination of additional financing options in order to execute our strategy and meet the operating cash flow requirements necessary to operate and grow our business. We may need or want to raise additional funds through the issuance of equity, equity-related or debt securities or through obtaining credit from financial institutions to fund, together with our principal sources of liquidity, the costs of developing and manufacturing our current or future products, to pay any significant unplanned or accelerated expenses or for new significant strategic investments, or to refinance our significant consolidated indebtedness, even if not required to do so by the terms of such indebtedness. The Company is pursuing a combination of strategic measures, including raising sufficient capital over the next 12 months, further reducing its cash burn rate, negotiating payment plans with key creditors and lenders, and generating sufficient revenues and cash flows from its expanded range of products and solutions. However, we may not be able to obtain additional or requisite funding on favorable terms when required, or at all, or negotiate favorable payment plans with key creditors and lenders or execute our strategic development plans or to meet our cash flow needs. Our inability to obtain funding or engage in strategic transactions could have a material adverse effect on our business, our strategic development plan for future growth, our financial condition, and our results of operations.
Our capital recycling model may not perform as anticipated
Our growth strategy is predicated on a repeatable capital recycling flywheel, whereby stabilized data center assets are refinanced with long-term, low-cost debt, releasing capital for reinvestment into subsequent developments. The Group targets a development refinancing cycle of 18-24 months and a cash-on-cash return of approximately 5x upon refinancing. However, this model depends on multiple assumptions, including the ability to secure long-term lease agreements with creditworthy tenants, complete construction within budget and timeline, obtain refinancing at assumed loan-to-value ratios, and maintain asset valuations at projected levels. If any of these assumptions prove incorrect, or if market conditions for data center debt financing deteriorate, the Group may be unable to refinance its assets on favorable terms or at all, and its ability to recycle capital into new projects may be materially impaired. Any failure of the capital recycling model to perform as anticipated could require the Group to seek additional equity financing, slow its development pipeline or reduce its growth targets, any of which could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
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If we continue to experience losses and we are not able to raise additional financing to grow the revenue streams of the Company to become profit making, or generate cash through sales of assets, we may not have sufficient liquidity to sustain our operations and to continue as a going concern.
We incurred losses of $47.9 million, $17.5 million and $46.7 million for the years ended June 30, 2026, 2025 (restated) and 2024, respectively. If we are unable to generate sufficient revenue from the operation of our businesses, or if we are unable to reduce our expenses sufficiently, we may continue to experience substantial losses.
Our consolidated financial statements are prepared on a going concern basis. Our directors have assessed our ability to continue as a going concern and have concluded that we have adequate resources to continue in operational existence for at least twelve months from the reporting date of our consolidated financial statements, and that no material uncertainty exists in relation to going concern. This assessment depends on our ability to meet our obligations as they fall due, including the timely collection of our subscription receivables and the settlement of our remaining liabilities. If losses continue, and if we are unable to raise additional financing on sufficiently attractive terms, renegotiate with our creditors and lenders on favorable terms, or generate cash through asset sales, we may not have sufficient liquidity to sustain our operations or meet our financial obligations, and we may not be able to continue as a going concern.
We are exposed to interest rate risk and currency exchange rate risk.
Our project financing arrangements are expected to involve variable rate debt, exposing the Group to changes in interest rates. An increase in interest rates would increase the Group’s debt service costs and could reduce the net cash flows generated by its projects. Higher interest rates could also affect asset valuations and capitalization rates in the real estate and infrastructure sectors, including data center operators and investors, which could reduce demand for the Group’s projects or the rental levels achievable. The Group’s project development activities are conducted in multiple currencies, including NOK, EUR, USD, AED or other currencies. The Group’s reporting currency is USD, and fluctuations in exchange rates could affect the Group’s reported costs, the value of its project portfolio and its financial results. The Group may not enter into derivative financial instruments to manage currency or interest rate risk, and the effectiveness of any future hedging arrangements may be limited. Adverse currency or interest rate movements could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
Our development costs and project rights may be subject to impairment or write-down.
We incur significant cost in connection with the development of our projects, including costs related to land acquisition, site evaluation, permitting, grid connection applications, concept design, engineering studies and legal structuring. These development costs are capitalized or recognized as project assets in accordance with applicable accounting standards. If a project fails to progress, if key assumptions regarding grid availability, zoning, permitting or market demand prove incorrect, or if the Group decides not to proceed with a project, the Group may be required to write down or impair the carrying value of the relevant development costs or project rights. Furthermore, the carrying value of the Group’s operational assets, including the Mo i Rana facility, is based on assumptions regarding future cash flows from AI leasing that have not yet been contractually secured. Any material impairment charge or write-down of project assets or operational assets could adversely affect the Group’s financial condition and results of operations. The valuation of the Group’s project pipeline is inherently uncertain and depends on assumptions regarding future market conditions, project progress and realization opportunities, which may prove to be incorrect.
Inflationary pressures and global economic downturns may adversely affect our project economics and demand for data center capacity.
Our project development activities are exposed to inflationary pressures, including increases in the cost of land, construction materials, grid connection fees, professional services and labor costs. Data center construction costs are particularly sensitive to inflation in key inputs such as copper, steel, concrete, electrical components and specialist engineering labor, all of which have experienced significant price increases in recent years due to global supply chain disruptions and increased demand from the data center sector. A sustained increase in construction costs or equipment pricing could compress project development margins, reduce the targeted unit site ROE of 5x and the expected cash-on-cash return of approximately 4x upon refinancing, potentially rendering certain projects economically unviable. In addition, a global economic downturn or volatility in financial markets could reduce tenant demand for data center capacity, cause prospective tenants to delay capital commitments, reduce the willingness of colocation operators and investors to enter into long-term lease commitments, reduce the availability of financing, or result in adverse movements in interest rates, exchange rates or asset valuations. Any such circumstances could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
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We may be exposed to tax risks and changes in tax regulation.
We are subject to prevailing tax laws and regulations in the jurisdictions in which it operates, including with respect to corporate income tax, property tax, value added tax, transfer pricing, custom duties and withholding taxes. The Group’s operational structure involves cross-border transactions, intra-group financing and development of land rights and data center assets across multiple jurisdictions, which may give rise to complex tax questions relating to transfer pricing, permanent establishments and tax treaty benefits. Tax laws, regulations and their interpretation may change, and tax authorities may challenge the Group’s tax positions or the characterization of its transactions. In particular, the tax treatment of the Group’s capital recycling model, including the tax consequences of asset refinancing and distribution of excess cash, may be subject to scrutiny. If the Group’s tax positions are challenged or if applicable tax rules change in a manner that is adverse to the Group, this could result in increased tax liabilities, fines or interest, with a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
We face audit and financial reporting risks during a period of auditor transition and strategic change.
We are in a period of auditor transition. On August 26, 2025, our Audit Committee approved the dismissal of PKF Littlejohn LLP as our independent registered public accounting firm, and approved the engagement of Withum as our independent registered public accounting firm. In May 2026, we appointed Menzies LLP as our UK statutory auditor. Withum’s audit of our consolidated financial statements as of and for the year ended June 30, 2026 includes VivoPower Norge Infrastructure AS (formerly Cromwell AS) and its subsidiary Arctic Norge Data I AS (formerly Nordland Data AS) from the May 12, 2026 acquisition date. Separately, MSPC performed a one-time audit, in accordance with US generally accepted auditing standards (US GAAS), of the pre-acquisition financial statements of VivoPower Norge Infrastructure AS and Arctic Norge Data I AS, which were prepared under Norwegian GAAP with a reconciliation to IFRS, for inclusion in our SEC filings in respect of the acquisition.
Any delay in completing these audit and assurance processes, any material audit finding, any qualification or emphasis of matter in audit reports, or any disagreement between the Group and its current or former auditors regarding accounting treatment or financial presentation could delay the publication of financial statements, disrupt financial reporting, reduce investor confidence or lead to volatility in the market price of the Company’s shares, which could have a material adverse effect on the Group’s business, financial condition and prospects.
We have deferred cash payment obligations in connection with the acquisition of VivoPower Norge Infrastructure AS.
In connection with the acquisition of VivoPower Norge Infrastructure AS (formerly Cromwell AS), which completed on May 12, 2026, the Group is obligated to make deferred cash payments to the sellers totaling US$ 10.25 million, comprising US$ 5.0 million due on November 12, 2026 and US$ 5.25 million due on May 12, 2027. Up to US$ 2.0 million is subject to retention in respect of indemnity claims under the sale and purchase agreement. Other than the retention, these obligations are not contingent on the financial performance of VivoPower Norge Infrastructure AS or the progress of the Mo i Rana conversion. In light of the Norwegian tax matter described below, the Group may seek to withhold or escrow part of these amounts against indemnity claims. The sellers may dispute any such withholding, which could give rise to a dispute with LIAN Group, a significant shareholder of the Company.
The deferred payments fall due within twelve months of 30 June 2026 and will coincide with the period in which the Group is deploying capital into the conversion of the Mo i Rana facility and the development of pipeline projects. The Group’s ability to meet these obligations in full and on time depends on raising additional capital and maintaining adequate liquidity. Any delay or shortfall in capital raising, or any unexpected increase in operating or development costs, could impair the Group’s ability to pay when due.
Failure to make the deferred payments in accordance with the sale and purchase agreement could result in claims by the sellers, disputes regarding the acquisition, reputational damage, or default consequences under the acquisition agreement or other financing arrangements, with potential enforcement against Group assets, including the share and asset pledges granted under the agreement. Any of these circumstances could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
Arctic Norge Data I AS is subject to a Norwegian tax audit relating to periods before our acquisition, and we may not be able to recover any resulting liability from the seller.
Arctic Norge Data I AS (formerly Nordland Data AS), a subsidiary of VivoPower Norge Infrastructure AS (formerly Cromwell AS), is the subject of a VAT and corporate income tax audit by the Norwegian Tax Administration (Skatteetaten) that commenced in August 2025, before our acquisition, and relates to periods from 2021 to February 2025. As of the date of this Annual Report, the Group has not received an assessment and is unable to estimate the amount, if any, of additional tax, interest or penalties that may result. The outcome is uncertain and could result in assessments of additional tax, interest and penalties, which may be material, could divert management attention and could affect the operation of the Mo i Rana facility.
We may seek to recover any resulting liability from the seller under the warranty and indemnity provisions of the sale and purchase agreement. However, there can be no assurance that we will recover any amount from the seller, in full or at all, or that we will be entitled to withhold or set off any amount against the deferred consideration. Any dispute with the seller, which is part of LIAN Group, a significant shareholder of the Company, could be costly and time-consuming and could adversely affect our relationship with LIAN Group. Any of these matters could have a material adverse effect on our business, financial condition and results of operations.
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A significant part of the subscription proceeds under our Regulation S placement remains unpaid, and we may not collect it.
Under our Regulation S placement, a consortium led by Ceres Holding Limited (the “Ceres consortium”) committed to subscribe for 10.0 million Class A Ordinary Shares at US$6.05 per share, a total of US$60.5 million. Till the filing of this report, the Ceres consortium has settled US$8.12 million of this amount, and 2,189,471 Class A Ordinary Shares have been issued to the Ceres consortium to date. As at 30 June 2026, US$59.3 million of the US$60.5 million remains unpaid. Payment of the balance has been delayed as a result of the conflict in the Middle East, where the Ceres consortium is based, and the timing of payment depends on the subscribers’ ability and willingness to pay. The receivable is unsecured. If the Ceres consortium fails to pay all or part of the amount when due, we may be unable to fund our planned activities, including the deferred consideration for the Mo i Rana Acquisition, and we may be required to recognize an expected credit loss. Enforcing the subscription commitment may be costly, time-consuming and uncertain, particularly as the subscribers are located outside the United Kingdom and the United States.
Our operational and financial results may vary significantly from period to period due to fluctuations in our operating costs and other factors.
Demand for data center capacity and AI infrastructure may be lower than expected. Our business depends on continued and growing demand for data center capacity, particularly from AI workloads. However, demand for AI data center capacity could be affected by technological developments that reduce compute requirements, increased competition from other data center developers, regulatory developments, energy price volatility, or customers choosing alternative infrastructure models. If demand for data center projects or AI infrastructure capacity is lower than expected, we may be unable to commercialize our projects or secure tenants on the terms or within the timeframes anticipated, resulting in lower revenues, project write-downs or reduced ability to attract commercial partners, which could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
In order to facilitate the growth of our Tembo EUV utility vehicle (“EUV”) battery-electric conversion kits for off-road and ruggedized or customized on-road applications, Tembo PUV public utility vehicle (“PUV”) battery-electric conversion kits for Jeepneys in the Philippines, Tembo EVP Electric Vehicle Products (“EVP”), which includes Tembo’s first fully-electrified road ready light pickup truck, the Tembo Tusker, and related services, and Tembo SES an extensive portfolio of EV charging solutions for home and commercial applications strategy, we may need to make material investments of both an operational expenditure and a capital expenditure nature.
We may not be profitable from period to period because we do not know the rate at which our revenue will grow, if it will grow at all, and we do not know the rate at which we will incur expenses. If we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis. Our revenue and operating results are difficult to predict and may vary significantly from period to period. Sustained losses could have a material adverse effect on our business, financial condition or results of operations.
We expect our period-to-period financial results to vary based on our operating costs, which we anticipate will fluctuate as the pace at which we continue to design, develop and manufacture new products and to increase production capacity by expanding our current manufacturing facilities and adding future facilities. Additionally, our revenues from period to period may fluctuate as we introduce existing products to new markets for the first time and as we develop and introduce new products. Moreover, our financial results may not meet expectations of equity research analysts, ratings agencies or investors, who may focus on short-term financial results. Accordingly, the trading price of our Class A ordinary shares could decline substantially, either suddenly or overtime.
If we fail to meet changing customer demands, we may lose customers and our sales could suffer.
The AI data center industry changes rapidly. Tenant requirements are evolving, including higher power densities, liquid cooling, redundancy, connectivity and security specifications, and changes in GPU architectures and AI workloads can make existing facility designs less suitable. Our ability to remain competitive will depend on our ability to design, convert and deliver facilities that meet these requirements on a timely and cost-effective basis. We cannot be certain that the Mo i Rana facility, once converted, or any other facility we develop, will meet the specifications that prospective tenants require or achieve market acceptance. Any failure to meet tenant requirements could result in the loss of prospective tenants or lower occupancy and rental rates, which could have a material adverse effect on our business, financial condition or results of operations.
Our Tembo electric vehicle business is also subject to changing customer requirements and technologies. Customers in the markets Tembo serves may require new battery, powertrain and conversion specifications, and Tembo’s ability to remain competitive depends on its ability to develop products that meet those requirements on a cost-effective basis. We cannot be certain that Tembo will successfully develop, source or market new or enhanced products, and any resulting loss of customers could have a material adverse effect on our business, financial condition or results of operations.
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Our future business depends in part on our ability to make strategic acquisitions, investments and divestitures and to establish and maintain strategic relationships, and our failure to do so could have a material and adverse effect on our market penetration and revenue growth.
We frequently look for and evaluate opportunities to acquire other businesses, make strategic investments or establish strategic relationships with third parties to improve our market position or expand our products and services. When market conditions permit and opportunities arise, we may also consider divesting part of our current business to focus management attention and improve our operating efficiency. Investments, strategic acquisitions and relationships with third parties could subject us to a number of risks, including risks associated with integrating their personnel, operations, services, internal controls and financial reporting into our operations as well as the loss of control of operations that are material to our business. If we divest any material part of our business, we may not be able to benefit from our investment and experience associated with that part of the business and may be subject to intensified concentration risks with less flexibility to respond to market fluctuations. Moreover, it could be expensive to make strategic acquisitions, investments, divestitures and establish and maintain relationships, and we may be subject to the risk of non-performance by a counterparty, which may in turn lead to monetary losses that materially and adversely affect our business. We cannot assure you that we will be able to successfully make strategic acquisitions and investments and successfully integrate them into our operations or make strategic divestitures or establish strategic relationships with third parties that will prove to be effective for our business. Our inability to do so could materially and adversely affect our market penetration, our revenue growth and our profitability.
Additionally, any acquisition involves potential risks, including, among other things:
| ● | mistaken assumptions about assets, revenues and costs of the acquired company, including synergies and potential growth; | |
| ● | an inability to successfully integrate the assets or businesses we acquire; | |
| ● | complexity of coordinating geographically disparate organizations, systems and facilities; | |
| ● | the assumption of unknown liabilities for which we are not indemnified or for which our indemnity is inadequate; | |
| ● | mistaken assumptions about the acquired company’s suppliers or dealers or other vendors; | |
| ● | the diversion of management’s and employees’ attention from other business concerns; | |
| ● | unforeseen difficulties operating in new geographic areas and business lines; | |
| ● | customer or key employee losses at the acquired business; and | |
| ● | acquiring poor quality assets, systems and processes. |
Our insurance coverage strategy may not be adequate to protect us from all business risks.
We may be subject, in the ordinary course of business, to losses resulting from products liability, accidents, acts of God and other claims against us, for which we may have no insurance coverage. Additionally, the policies that we do have may include significant deductibles or self-insured retentions, policy limitations and exclusions, and we cannot be certain that our insurance coverage will be sufficient to cover all future losses or claims against us. A loss that is uninsured or which exceeds policy limits may require us to pay substantial amounts, which may harm our business, operating results and financial condition.
Our operations may be adversely affected by failure to maintain or renegotiate distribution, supply, manufacturing or license agreements on favorable terms
We have distribution, supply, manufacturing and license agreements for our businesses. These agreements vary depending on the particular business, but tend to be for a fixed number of years. There can be no assurance that our businesses will be able to renegotiate rights on favorable terms when these agreements expire or that they will not be terminated. Failure to renew these agreements on favorable terms, or any disputes with distributors of our businesses’ products or suppliers of materials, could have an adverse impact on our business and financial results.
In particular in the case of Tembo we depend on suppliers for the components of our kit to maintain or improve their prices as volumes ordered increase and to deliver their products to Tembo within agreed timeframes. There can be no assurance that our volumes of orders and our suppliers’ pricing and lead times will be aligned with our agreements or forecast, which may have an adverse impact on our business and financial results.
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We may incur unexpected warranty and performance guarantee claims that could materially and adversely affect our financial condition or results of operations.
In connection with our products and services, we may provide various system warranties and/or performance guarantees. While we generally are able to pass through manufacturer warranties we receive from our suppliers to our customers, in some circumstances, our warranty period may exceed the manufacturer’s warranty period, or the manufacturer warranties may not otherwise fully compensate for losses associated with customer claims pursuant to a warranty or performance guarantee we provided. For example, most manufacturer warranties exclude many losses that may result from a system component’s failure or defect, such as the cost of de-installation, re-installation, shipping, personal injury, property damage, and other losses. In addition, in the event we seek recourse through manufacturer warranties, we will also be dependent on the creditworthiness and continued existence of these suppliers. These risks are exacerbated in the event such manufacturers cease operations or fail to honor their warranties.
As a result, warranty or other performance guarantee claims against us that exceed reserves could cause us to incur substantial expense to repair or replace defective products. Warranty reserves include management’s best estimates of the projected costs to repair or to replace items under warranty, which are based on actual claims incurred to date and an estimate of the nature, frequency and costs of future claims. Such estimates are inherently uncertain and subject to change based on our historical or projected experience. Significant repair and replacement costs could materially and negatively impact on our financial condition or results of operations, as well divert employee time to remedying such issues. In addition, quality issues can have various other ramifications, including delays in the recognition of revenue, loss of revenue, loss of future sales opportunities, increased costs associated with repairing or replacing products, and a negative impact on our reputation, any of which could also adversely affect our business or operating results.
Our ability to scale up Tembo, our commercial EV segment, is dependent on securing new business opportunities and orders, meeting the requirements of customers and the timely delivery of orders across different market sectors.
We plan to expand in the commercial electric vehicle market, providing electric utility vehicles (“EUV”) with a key focus initially on servicing EUV customers in the mining, infrastructure, government services, humanitarian, tourism, and utilities sectors. As we look to develop these opportunities, monetize our pipeline and secure firm orders, we will incur increased operational expenditure and capital expenditure that may impact on our profitability and cash flows.
We will continue to be engaged in product innovation with Tembo as we look to introduce new products, including EUV conversion kits with a longer range and/or greater payload capacity. To the extent that such innovation does not successfully meet regulatory requirements, quality and safety standards and/or customer expectations more generally, future sales could be impaired.
Following the acquisition of Tembo, we signed distribution agreements with a number of partners in North America, Australia, the Middle East, Africa, Southeast Asia and Europe to sell EUV battery-electric conversion kits for off-road and ruggedized or customized on-road applications, PUVbattery-electric conversion kits for Jeepneys in the Philippines, Electric Vehicle Products (Tembo Tusker), and Tembo SES. If Tembo is not able to meet the technical specifications, quality and safety standards of our customers and partners, then this will have a material adverse effect on Tembo’s brand, reputation, revenue and future prospects. Furthermore, if Tembo is unable to fulfill product delivery volumes in accordance with timelines agreed with our customers and partners, this could have a material adverse effect on future sales, operating results and the financial condition of the business.
Following the planned reverse merger of Tembo with a special purpose acquisition company and independent listing on NASDAQ (de-SPAC), Tembo will become a separately listed entity, providing it with direct access to capital markets to fund its growth and operational needs. This structure is expected to enhance its ability to scale independently while allowing VivoPower to focus on strategic oversight as a shareholder. If the planned reverse merger of Tembo does not occur, VivoPower will need to explore alternative strategies, such as raising additional capital or restructuring operations, to support Tembo’s growth and meet its operational and financial objectives.
The future growth and success of Tembo is dependent upon acceptance of its (Tembo EUV) utility vehicle (“EUV”) battery-electric conversion kits for off-road and ruggedized or customized on-road applications, (ii) (Tembo PUV) public utility vehicle (“PUV”) battery-electric conversion kits for Jeepneys in the Philippines, (iii) (Tembo EVP) Electric Vehicle Products (“EVP”), and (iv) (Tembo SES) an extensive portfolio of EV charging solutions for home and commercial applications amongst key target customers in the mining, infrastructure, government services, humanitarian, tourism and utilities sectors.
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Our strategy for Tembo is to focus its vehicle fleet electrification efforts on the ruggedized, customized and off-road segments of the electric vehicle market including mining, infrastructure, government services, humanitarian, tourism and utilities sectors. This market is relatively new, rapidly evolving, and characterized by rapidly changing technologies, new competitors, evolving government regulation and industry standards, frequent new vehicle announcements and changing consumer demands and behaviors. If this market does not develop as we expect or develops more slowly than we expect, our business, results of operations, financial condition and prospects will be materially adversely affected.
Factors that may influence the market acceptance of new zero-emission vehicles and the conversion of existing vehicles to zero-emission electric vehicles include:
| ● | perceptions about zero-emission electric vehicle quality, safety design, performance and cost, especially if adverse events or accidents occur that are linked to the quality or safety of any electric vehicle; | |
| ● | perceptions about the limitations on the range over which zero-emission electric vehicles may be driven on a single battery charge; | |
| ● | perceptions about vehicle safety in general, in particular safety issues that may be attributed to the use of advanced or new technology; | |
| ● | the availability of, and perceptions about, alternative fuel vehicles, including hydrogen, as well as the cost of these fuels, which may reduce demand for battery electric vehicles; | |
| ● | the availability of service infrastructure for zero-emission electric vehicles; | |
| ● | changes in the costs of oil, diesel and gasoline; | |
| ● | government regulations and economic incentives, including a change in the administrations and legislations of federal and state governments, promoting fuel efficiency and alternate forms of energy; | |
| ● | access to charging stations, standardization of electric vehicle charging systems and perceptions about convenience and cost to charge an electric vehicle; | |
| ● | the availability of tax and other governmental incentives and rebates to purchase and operate electric vehicles or future regulation requiring increased use of zero-emission or hybrid electric vehicles, such as the Infrastructure Investment and Jobs Act enacted in November 2021 in the United States; and | |
| ● | macroeconomic factors. |
The influence of any of the factors described above may cause current or potential customers not to purchase Tembo’s electric vehicles, which would materially adversely affect our business, results of operations, financial condition and prospects.
Tembo faces certain operational risks as it seeks to scale up its assembly and delivery capabilities and if it fails to execute properly, this will expose us to material losses and compromise our cash flows.
The Tembo business faces operational risks as a maker of battery-electric ruggedized and off-road vehicles embarking on a scale up of its assembly and delivery capabilities. These risks include:
| ● | industrial accidents or pollution which may result in operational disruptions such as work stoppages and which could result in increased production costs as well as financial and regulatory liabilities; | |
| ● | actual and potential supply chain shortages, in particular with regard to batteries and other vehicle inputs, as well as increases in the prices of such inputs, which may have a material adverse effect on the operations, profits and cash flow of Tembo; | |
| ● | issues relating to design or manufacturing defects; | |
| ● | issues relating to safety, including compliance with safety regulations and standards; | |
| ● | inability to secure appropriate premises and equipment; | |
| ● | inability to attract and retain appropriately qualified personnel; and | |
| ● | delays in launching or scaling up production and assembly of new products and features. |
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Constant innovation and product development is required for Tembo to ensure it remains competitive and relevant.
Tembo operates in a market that is relatively new, rapidly evolving, and characterized by rapidly changing technologies, new competitors, evolving government regulation and industry standards, frequent new vehicle announcements and changing consumer demands and behaviors. In order to stay competitive and relevant, it needs to continuously innovate and invest in product development and new technologies.
In particular, we are in the process of testing EV conversion kits with new battery platforms. Our ability to execute on the research, development and design of the EV conversion kit within the intended time and budget is key to deliver to our distribution partners and customers in accordance with our existing and upcoming agreements and to grow revenues at Tembo.
If Tembo fails to innovate and evolve to meet customer demands and stay ahead of competing technologies and companies, it may become obsolete or non-competitive. This would have a material adverse effect on our business, results of operations and financial condition.
If the Tembo business does not perform in line with our expectations, we may be required to write-down the carrying value of our investment, including goodwill and intangible assets.
Under IFRS, we are required to test the carrying value of long-term assets or cash-generating units for impairment at least annually and more frequently if we have reason to believe that our expectations for the future cash flows generated by these assets may no longer be valid. If the results of operations and cash flows generated by Tembo are not in line with our expectations, we may be required to write-down the carrying value of the investment. Any write-down could materially affect our business, financial condition and results of operations.
We have a limited operating track record in the development and sale of Sustainable Energy Solutions (“SES”), and as a result, we may not be successful in developing and scaling up this business segment profitably.
Tembo’s SES segment designs, evaluates, sells, and implements renewable energy infrastructure products, complementing our electric vehicle offerings by enabling clients to adopt comprehensive decarbonization measures. These include on-site renewable generation, battery storage and microgrids, EV charging stations, emergency backup power solutions, and digital twin technology. While this segment is intended to augment our Electric Vehicle business and provide corporate customers with holistic decarbonization solutions, our operating history in delivering such integrated offerings remains limited.
Although we have experience in renewable energy development, we have limited experience and track record in combining EV battery charging, battery storage, microgrids, and digital twin technology into a full-suite solution for large energy users. We are still in the process of developing and scaling these capabilities.
If we fail to successfully execute or scale the SES business segment, we may incur significant operating losses, which could reduce our cash flows and have a material adverse effect on our financial condition.
Risks Related to Our Legacy Digital Asset Activities and Strategic Investments
We discontinued our digital asset treasury strategy in 2026, but remain exposed to its consequences.
In 2025 we announced a digital asset treasury strategy focused on XRP. In February 2026 we announced that we will not acquire digital assets on our balance sheet and will focus on our data center infrastructure business. Our earlier statements, financing arrangements and share issuances relating to the former strategy may continue to attract scrutiny from investors, regulators and other third parties, and could result in claims, investigations or reputational harm. The change of strategy may also reduce investor interest in our shares and make future financings harder. A significant part of the subscription proceeds from the Ceres consortium remains unpaid, and we may not receive it. See “Risks related to raising of capital and financing.”
Our investments in a listed Korean company and an unlisted private company are subject to valuation, liquidity, currency and governance risks, and a decline in their value could adversely affect our results.
At June 30, 2026, we held equity investments measured at fair value through profit or loss with a total carrying amount of US$7.4 million, comprising a 16.67% holding in a company listed on the KOSDAQ market (US$3.0 million) and a minority holding in an unlisted private company (US$4.4 million). We do not control either investee, have no board representation in either, and have limited ability to influence their strategy, financing or dividend policy. Changes in fair value are recognized in our profit or loss, so declines in value would directly reduce our reported results.
The KOSDAQ-listed shares are held through the Korea Securities Depository and were subject to a one-year lock-up from the listing date, so we may be unable to sell them when we wish to. Their price may be volatile, the trading market may be thin, and the shares are denominated in Korean won, so currency movements affect their US dollar value. We may be unable to sell the stake at a favorable price, or at all.
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There is no public market for the shares in the unlisted company, and any transfer may be subject to the investee’s approval process and other contractual restrictions. We may therefore be unable to sell them when we wish to, or at all. Their fair value is determined using recent transaction evidence and other market information, rests on unobservable inputs and judgments, and may change materially. The value of the unlisted company also depends on its business and on the price and regulatory treatment of digital assets, none of which we control.
Regulatory developments affecting digital assets could adversely affect our remaining investments.
The legal and regulatory treatment of digital assets, including whether XRP or related instruments are securities, is uncertain and continues to change. Although we no longer hold digital assets directly, adverse regulatory, enforcement or market developments could reduce the value of Ripple Labs and our shares in it or limit our ability to realize that value.
Risks related to raising of capital and financing
We may not be able to generate sufficient cash flow to service all our indebtedness, any additional debt we may incur and our other ongoing liquidity needs, and we may be forced to take other actions to satisfy our obligations under our indebtedness or any additional debt we may incur, which may not be successful.
For the audited year ended June 30, 2026, debt obligations amounted to $39.0 million compared to June 30, 2025, where we had an aggregate of $29.2 million in debt obligations. The balance as of June 30, 2026, included shareholder loan worth US$28.7 million and lease liabilities of US$10.3 million. The shareholder loan has been paid off and settled post balance date through cash payments as well as debt to equity swaps. Our ability to make scheduled payments on or to refinance our debt obligations and to fund our ongoing liquidity needs depends on our financial condition and operating performance, which is subject to prevailing economic and competitive conditions and to certain financial, business and other factors beyond our control. There can be no assurance that we will maintain a level of cash flow from operating activities or that future borrowings will be available to us in an amount or on terms sufficient to permit us to pay the principal and interest on our indebtedness. If our cash flow and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay investments and capital expenditures, sell material assets, or to seek additional capital or restructure or refinance our indebtedness. These alternative measures may not be successful and may not permit us to meet our scheduled debt service obligations.
We could also face substantial liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other obligations or risk not being able to continue as a going concern. In addition, we may be able to incur additional indebtedness in the future. If new indebtedness is added to our current debt levels, the related risks that we now face could intensify. Any of the foregoing could have a material adverse effect on our business, financial condition, results of operations or prospects.
If we fail to adequately manage our planned growth, our overall business, financial condition and results of operations could be materially adversely affected.
If we fail to adequately manage our planned growth, our overall business, financial condition and results of operations could be materially adversely affected.
We are targeting significant growth, principally through the conversion of the Mo i Rana facility to AI-grade data center infrastructure and the development of additional data center sites. We believe this growth is supported by demand for AI data center capacity in our key geographic markets. Our Tembo electric vehicle business is also pursuing growth. Managing this growth will require us to expand our management, financial, operational and technical resources, to fund the associated capital expenditure, and to deliver projects on time and within budget, and we may not be able to do so.
We expect that this significant growth in activity will place significant stress on our operations, management, employee base and ability to meet working capital requirements sufficient to support this growth over the next 12 to 36 months. Any failure to address the needs of our growing business successfully could have a material adverse effect on our business, operating results and financial condition.
We may be unable to obtain favorable financing from our vendors and suppliers, which could have a material adverse effect on our business, financial condition or results of operations and prospects.
In addition to obtaining financing from certain financial parties, we have also historically utilized financing from our vendors and suppliers through customary trade payables or account payables. At times, we have increased the number of days’ payables outstanding. There can be no assurance that our vendors and suppliers will continue to allow us to maintain existing or planned payables balances, and if we were forced to reduce our payables balances below our planned level without obtaining alternative financing, our inability to fund our operations would materially adversely affect our business, financial condition and results of operations. We could also face substantial liquidity problems and might be required to dispose of material assets or enter into economically unfavorable financing arrangements to meet creditor demands or risk not being able to continue as a going concern.
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If we are unable to enter into new financing agreements when needed, or upon desirable terms, or if any of our current financing partners discontinue or materially change our financing terms, we may be unable to finance our operations and development projects or our borrowing costs could increase, which would have a material adverse effect on our business, financial condition and results of operations.
If we are unable to enter into new financing agreements when needed, or upon desirable terms, or if any of our current financing partners discontinue or materially change our financing terms, we may be unable to finance our operations and development projects or our borrowing costs could increase, which would have a material adverse effect on our business, financial condition and results of operations.
We require working capital, equity capital and credit facilities to fund our operations, the conversion of the Mo i Rana facility to AI-grade data center infrastructure, the development of additional data center sites and our other obligations. We expect to fund the conversion largely through project finance debt, and we may also require additional equity financing. Without access to sufficient and appropriate financing, or if financing is not available at desirable rates or on terms we deem appropriate, we would be unable to grow our business and may be unable to meet our obligations as they fall due. Our ability to obtain financing in the future depends on investors’, banks’ and other financing sources’ continued confidence in our business model and in the data center industry as a whole. In addition, regulatory changes in financial services markets in the jurisdictions in which we operate can affect the availability of financing, through capital availability in the market and the appetite of the market for certain industries, risks or businesses. Changes to our business, the business of our lenders, or the financing market in a region or as a whole could result in us being unable to obtain new financing or maintain existing financing.
To date, we have obtained financing for our business from a limited number of financial parties and investors. If any of them decided not to continue financing our business or to materially change the terms on which they are willing to provide financing, we could be required to identify new financing partners and negotiate new financing documentation. This process could be lengthy and could require us to delay the conversion of Mo i Rana or the development of other projects until new financing arrangements are in place. There can be no assurance that the terms offered by a new financing partner would compare favorably with those available from our current partners. In any such case, our borrowing costs could increase, which could have a material adverse effect on our business, financial condition and results of operations.
We are a holding company whose material assets consist of our holdings in our subsidiaries, upon whom we are dependent for distributions.
We are the holding company of the Group and do not ourselves conduct significant operating or development activities. Our principal operating subsidiary for our data center business is VivoPower Norge Data I AS, its subsidiary Arctic Norge Data I AS holds the Mo i Rana facility. We are therefore dependent on receiving dividends, group contributions and other distributions from our subsidiaries in order to meet our obligations and to fund our activities. The payment of dividends or other distributions by our subsidiaries to us may be restricted by applicable laws, including corporate and tax law requirements in the relevant jurisdictions (particularly Norway), the financial position and distributable reserves of the relevant subsidiaries, and covenants in existing or future debt financing agreements. Any inability of our subsidiaries to upstream sufficient funds could impair our ability to service our obligations, which could have a material adverse effect on our business, financial condition, results of operations, cash flows and prospects.
Tembo is currently working towards a business combination with Nasdaq-listed Cactus Acquisition Corp. 1 Limited (CCTS). This process involves significant risks and uncertainties that could adversely affect our business, financial condition, results of operations, and prospects. There is no guarantee that we will be able to consummate this transaction.
In August 2024, Tembo executed a definitive Business Combination Agreement (“BCA”) with CCTS. Should this merger be consummated, it will result in Tembo becoming a separately listed company on the Nasdaq Global Market Exchange. Though the transaction was expected to close in the first quarter of calendar year 2027, the business combination is subject to regulatory and shareholder approvals, compliance with applicable laws and jurisdictions, and prevailing economic and market conditions, and there is no assurance that the transaction will be completed within the timeframe or at all.
Delays in the completion, or the possibility of termination, of the business combination could adversely affect our financial condition, strategic goals, and Tembo’s ability to secure additional financing. Furthermore, factors such as, but not limited to, market sentiment, regulatory developments, and legal exposures related to the business combination can influence our share price, potentially leading to increased volatility and fluctuations prior to or upon the completion of the business combination, among other related risks. As a result, there can be no assurance that the expected benefits of the business combination will be realized, or that Tembo or the Company’s business operations or financial conditions will not be adversely affected.
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Risks related to ownership of our Class A Ordinary Shares
The trading price of our Class A Ordinary Shares is highly volatile and likely to continue to be so, presenting litigation risks.
The trading price of our Class A Ordinary Shares has been highly volatile and will likely continue to be subject to wide fluctuations in response to various factors, most of which are beyond our control. Our Class A Ordinary Shares have experienced an intra-day trading high of $6.86 per share and a low of $1.20 per share during the year ended June 30, 2026.
The stock market in general, and the market for technology-oriented companies in particular, has experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of those companies. Furthermore, short sellers and activists may seek to sensationalize selected news about companies, including ours, so as to influence supply and demand for the Class A Ordinary Shares, further influencing volatility in its market price. Public perception and other factors outside of our control may additionally impact our stock price.
Following periods of volatility in our share price and the market generally, there is a risk that securities class action litigation may be filed against us. While we would defend any such actions vigorously, any judgment against us or any future shareholder litigation could result in substantial costs and a diversion of our management’s attention and resources.
We may issue additional securities in the future, which may result in dilution to our shareholders and may depress our share price.
We are not restricted from issuing additional Class A Ordinary Shares or securities convertible into or exchangeable for Class A Ordinary Shares. Because we anticipate we will need to raise additional capital to operate and/or expand our business, we expect to conduct equity offerings in the future.
There is no limit on the number of Class A Ordinary Shares we may issue under our articles of association. However, the directors’ authority to allot Class A Ordinary Shares is limited to the extent authorized by the shareholders of the Company. On January 30, 2026, our shareholders passed an ordinary resolution generally and unconditionally authorizing the directors, in accordance with section 551 of the Companies Act 2006, to exercise all powers of the Company to allot shares and to grant rights to subscribe for, or convert any security into, shares in the Company up to an aggregate nominal amount of US$116,400,000. This authority will expire on January 30, 2031, unless renewed, varied or revoked. The Company may make offers or agreements before expiry that would or might require shares to be allotted or rights to be granted after expiry, and the directors may act on such offers or agreements as if the authority had not expired. Shareholders also passed a special resolution, subject to the passing of the allotment resolution, disapplying the statutory pre-emption rights in section 561(1) of the Companies Act 2006 in respect of any allotment made under that authority, in accordance with section 570 of the Companies Act 2006. As a result, we may allot shares under this authority for cash without first offering them to existing shareholders pro rata to their holdings. To the extent we conduct additional equity offerings, additional Class A Ordinary Shares will be issued, which may result in dilution to our shareholders. The Class A Ordinary Shares underlying our securities may be eligible for public resale in the future, either pursuant to registration or an exemption from registration. Sales of substantial numbers of shares in the public market could adversely affect the market price of our Class A Ordinary Shares. In addition, issuances of a substantial number of shares will reduce the equity interest of our existing investors and could cause a change in control of our Company.
Future sales of substantial amounts of our Class A Ordinary Shares in the public market, or the perception that these sales could occur, could adversely affect the price of our Class A Ordinary Shares and could impair our ability to raise capital through the sale of additional shares. Furthermore, the market price of our Class A Ordinary Shares could drop significantly if our executive officers, directors, or certain large shareholders sell their shares, or are perceived by the market as intending to sell them.
Our Series 1 convertible preference shares rank senior to our Class A Ordinary Shares, accrue payment-in-kind dividends and may result in substantial dilution, and our dual-class share structure concentrates voting power.
During FY26 we issued 296,507 Series 1 convertible preference shares at US$100 per share. The convertible preference shares rank senior to our Class A Ordinary Shares as to dividends and the return of capital on a winding up, carry a cumulative payment-in-kind dividend of 6% per annum and are convertible into Class A Ordinary Shares at a conversion price of US$6.80 per share, together with additional shares in respect of accrued dividends. On full conversion of the convertible preference shares outstanding at the date of this Annual Report, we would issue approximately 4,360,397 Class A Ordinary Shares, before shares issuable in respect of accrued dividends, representing approximately 14.2% of our outstanding Class A Ordinary Shares. Conversion, and the issue of further shares in respect of accrued dividends, would dilute holders of our Class A Ordinary Shares and could adversely affect their market price.
Our Articles of Association, adopted on January 30, 2026, provide for Class B Ordinary Shares carrying twenty votes per share. No ordinary shares have been redesignated as Class B Ordinary Shares and no Class B Ordinary Shares exist or have been issued. If Class B Ordinary Shares were issued in the future, their holders could hold a disproportionate share of the total voting power, which could limit the ability of holders of our Class A Ordinary Shares to influence corporate matters, including the election of directors and significant corporate transactions, and could discourage a change of control that other shareholders may consider beneficial.
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A small number of shareholders hold a significant percentage of our shares and may be able to exert significant influence over us.
As of June 30, 2026, TAG International DMCC held approximately 21.2% of our outstanding Class A Ordinary Shares and was our largest shareholder, and LIAN Group and entities associated with Kevin Chin also held significant interests (see Item 7.A). TAG International DMCC has also provided loans to the Company and has agreed to provide funding to Tembo. Significant shareholders may be able to exert influence over matters requiring shareholder approval, and their interests may differ from those of other shareholders. The sale, or the perception of a possible sale, of a substantial number of our shares by any of these shareholders could adversely affect the market price of our Class A Ordinary Shares.
We do not intend to pay any dividends on our Class A Ordinary Shares at this time.
We have not paid any cash dividends on our Class A Ordinary Shares to date. The payment of cash dividends on our Class A Ordinary Shares in the future will be dependent upon our revenue and earnings, if any, capital requirements, and general financial condition, as well as the limitations on dividends and distributions that exist under the applicable laws and regulations of England and Wales and will be within the discretion of our board of directors (the “Board”). It is the present intention of our Board to retain all earnings, if any, for use in our business operations and, accordingly, our Board does not anticipate declaring any dividends on our Class A Ordinary Shares in the foreseeable future. As a result, any gain you will realize on our Class A Ordinary Shares will result solely from the appreciation of such shares.
We cannot assure you that our Class A Ordinary Shares will always trade in an active and liquid public market. In addition, at times trading in our Class A Ordinary Shares on The Nasdaq Capital Market (“Nasdaq”) has been highly volatile with significant fluctuations in price and trading volume, and such volatility and fluctuations may continue to occur in the future. Low liquidity, high volatility, declines in our stock price or a potential delisting of our Class A Ordinary Shares may have a negative effect on our ability to raise capital on attractive terms or at all and may have a material adverse effect on our operations.
The market price of our Class A Ordinary Shares may be influenced by many factors, many of which are beyond our control, including those described above in “Risks related to our business and operations.” As a result of these and other factors, investors in our Class A Ordinary Shares may not be able to resell their shares at or above the price they paid for such shares or at all. The market price of our Class A Ordinary Shares has frequently been highly volatile and has fluctuated in a wide range. The liquidity of our Class A Ordinary Shares as reflected in daily trading volume on Nasdaq has usually been low.
During FY26 we did not receive any notice of deficiency from Nasdaq, and as of the date of this Annual Report we are in compliance with the continued listing requirements of The Nasdaq Capital Market and have no open Nasdaq deficiency matters. We have, however, received deficiency notices in prior years, relating to the minimum bid price requirement under Nasdaq Listing Rule 5550(a)(2) (in October 2022 and November 2024) and the minimum stockholders’ equity requirement under Nasdaq Listing Rule 5550(b)(1) (in January 2025), each of which was resolved.
There can be no assurance that the Company will be able to maintain compliance with Nasdaq’s continued listing requirements or that, if the Company receives a delisting notice and appeals the delisting determination by Nasdaq, such appeal would be successful.
Low liquidity, high volatility, declines in our stock price or potential delisting of our Class A Ordinary Shares may have a material adverse effect on our ability to raise capital on attractive terms or at all and a material adverse effect on our operations.
As a foreign private issuer whose shares are listed on Nasdaq, we may follow certain home country corporate governance practices instead of certain Nasdaq requirements.
As a foreign private issuer whose shares are listed on Nasdaq, we are permitted to follow certain home country corporate governance practices instead of certain requirements of Nasdaq. Among other things, as a foreign private issuer we may follow home country practice with regard to the composition of the Board, director nomination procedure, and quorum at shareholders’ meetings. In addition, we may follow our home country law, instead of Nasdaq rules, which require that we obtain shareholder approval for certain dilutive events such as for the establishment or amendment of certain equity based compensation plans, an issuance that will result in a change of control of the company, certain transactions other than a public offering involving issuances of a 20% or more interest in the company, and certain acquisitions of the stock or assets of another company. Accordingly, our shareholders may not be afforded the same protection as provided under Nasdaq’s corporate governance requirements. For example, Nasdaq Listing Rule 5615(a)(3) permits a foreign private issuer like us to follow home country practices in lieu of certain requirements of Listing Rule 5600, provided that certain requirements are met. Accordingly, we have elected to follow home country practice in lieu of the requirements under Nasdaq Listing Rule 5635(d), which requires companies to seek shareholder approval for the issuance of securities in connection with certain transactions other than a public offering involving the sale, issuance or potential issuance of our Class A Ordinary Shares at a price less than certain referenced prices, if such shares equal 20% or more of the Company’s Class A Ordinary Shares or voting power outstanding before the issuance. Instead, and in accordance with the Nasdaq home country accommodations, we comply with applicable U.K. corporate and securities laws, which do not require shareholder approval for such dilutive events.
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The market price of our shares may be significantly and negatively affected by factors that are not in our control.
The market price of our shares may vary significantly and may be significantly and negatively affected by factors that we do not control. Some of these factors include variance and volatility in global markets for equity and other assets; changes in legal, regulatory or tax-related requirements of governmental authorities, stock exchanges, or other regulatory or quasi-regulatory bodies; the performance of our competitors; and the general availability and terms of corporate and project financing.
The Group has existing indebtedness, including an outstanding shareholder loan from AWN; AWN is simultaneously a shareholder and the Group’s largest external creditor, creating a potential conflict of interest.
At June 30, 2026, the Group owed approximately US$28.7 million to AWN Holdings Limited (“AWN”), an affiliate of Arowana & Co. (“Arowana”), making AWN the Group’s largest external creditor as well as a shareholder. After the balance sheet date, the principal was settled through a combination of cash and issuance of CPS. Arowana was founded and is led by Kevin Chin, our Chief Executive Officer and Chairman, who controls approximately 14.3% of our issued Class A Ordinary Shares through associated entities. AWN’s interests as a creditor and as an equity holder may diverge from those of our other shareholders. This may affect the terms on which we raise future financing, and the decisions we make on corporate matters. The equity issued in the settlement dilutes existing shareholders and may increase the influence of Mr.Chin and his affiliates. Our remaining debt arrangements may contain covenants, security and repayment obligations that restrict our flexibility. A breach or an inability to service our debt could lead to acceleration, enforcement over our assets and cross-defaults. We still owe AWN accrued interest worth US$19.1 million.
AWN Holdings Limited (together with its affiliates and subsidiaries, “AWN”) owned approximately 2.9% of our outstanding Class A Ordinary Shares as at June 30, 2026. AWN is an affiliate of Arowana & Co., which is led by Kevin Chin, our Chief Executive Officer and Chairman. Mr. Chin controls approximately 14.3% of our issued Class A Ordinary Shares through AWN and his other associated entities as at June 30, 2026. AWN’s shareholding alone is limited. However, Mr. Chin’s aggregate interest, combined with his executive and board roles, may give him significant influence over the election of directors and other matters requiring shareholder approval. This could delay, defer or prevent a change of control or other business combination that other shareholders may view favorably.
AWN has also been the Group’s principal lender. In November 2024, the Directors agreed the Amended and Extended Loan Agreement described in this Report. Under it, principal, accrued interest and accounts payable of approximately US$20.6 million were extended to January 1, 2026 in consideration for the issue of 1.2 million warrants. The Directors weighed the need to maintain a workable relationship with the Group’s principal funder against the resulting dilution to other shareholders. At June 30, 2026, approximately US$29 million was owed to AWN. After the balance sheet date, the principal was settled through a combination of cash and equity swaps. While the loan was outstanding, AWN held customary rights of a secured first-ranking lender in the event of a covenant breach or default, and the exercise of those rights could have adversely affected our share price. AWN’s interests as a lender, shareholder and affiliate of Mr. Chin may differ from those of our other shareholders.
The rights of our shareholders may differ from the rights typically offered to shareholders of a U.S. corporation.
We are incorporated under English law. The rights of holders of our Class A Ordinary Shares are governed by English law, including the Companies Act 2006, and by our Articles of Association. These rights differ in certain respects from the rights of shareholders in typical U.S. corporations. Under the Companies Act 2006, before shares are allotted or rights to subscribe for shares are granted, our directors must have the relevant shareholder authority to allot the shares, and shareholders must disapply pre-emption rights where required. This authority is not required for awards made under an “employees’ share scheme”, but awards to non-employees are not made under such a scheme.
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Risks related to climate, economic and geopolitical factors
We face risks related to natural disasters, health epidemics, and other catastrophes, which could significantly disrupt our operations or compromise our business continuity.
Our business could be materially and adversely affected by natural disasters or other catastrophes, such as earthquakes, fire, floods, hail, windstorms, severe weather conditions, environmental accidents, extreme temperatures, power loss, communications failures, explosions, terrorist attacks as well as epidemics and pandemics, including but not limited to outbreaks of avian influenza, severe acute respiratory syndrome, or SARS, Zika virus, Ebola virus, the 2019 novel coronavirus (“COVID-19”) and other similar public health emergencies.
General economic conditions, including levels of inflation and official interest rates in different jurisdictions in which we operate, could adversely impact demand for our solutions, products and services.
Elevated geopolitical instability and economic volatility around the world may have a significant adverse effect on economic activity and VivoPower’s businesses, which are global by nature.
Furthermore, with increasing general cost inflation pressures, to the extent that we are unable to fully pass on any increases in input costs including materials and labor, this will adversely affect our profit margins, cash flows and ultimately our business, results of operations and financial condition.
Changes in market interest rates in the countries in which we operate, and in global financial markets, may have a material adverse impact on our business. Higher interest rates would increase our borrowing costs, including the cost of the project finance we expect to use to fund the conversion of the Mo i Rana facility, and could reduce the availability of financing for us and our tenants. Tenants and investors may also apply higher discount rates in their decision making, which could reduce demand for our facilities and the value of our assets. Volatility in rates and currency exchange rates between the U.S. dollar, the Norwegian krone and other currencies may further affect our costs and returns. To the extent we are unable to mitigate these risks, there could be a material adverse effect on our business, results of operations and financial condition.
The demand for our solutions, products and services is influenced by macroeconomic factors such as global economic conditions, demand for electricity, and supply and prices of other energy products, such as oil, coal and natural gas. Economic slowdowns, global, regional or local recessions or depressions could lead to eroded confidence from our customers and decreased spending more generally, which in turn could reduce demand for the Company’s products. Unfavorable economic conditions could also negatively impact on the Company’s customers, distributors, suppliers, and financial counterparties, who may experience cash flow problems, increased credit defaults or other financial issues, in turn affecting our business, results of operations and financial condition.
The demand for our solutions, products and services is also affected by microeconomic factors, such as government regulations and policies concerning the electric vehicle industry, the electric utility industry and the renewable energy industry and more broadly, the environment and carbon emissions.
Our growth and profitability depend on demand for, and the prices of, our data center capacity and related services, which are affected by the cost and availability of electricity, the cost of equipment and construction, and the demand for AI infrastructure. Our Tembo electric vehicle business also depends on the cost of conversion kit components. If we experience negative macroeconomic or microeconomic conditions, our business, results of operations and financial condition may be materially adversely affected.
Our operations span multiple markets and jurisdictions, exposing us to numerous legal, political, operational, foreign currency exchange and other risks that could negatively affect our operations and profitability.
With operations in the United States, Norway, the United Kingdom, Europe, the Philippines, the United Arab Emirates and Australia, as well as partners and customers in Africa, Southeast Asia, South Asia and China we are exposed to various financial, political and economic factors. Our customers and suppliers are also located in various countries across the world. We are subject to regulation in all of the jurisdictions in which we operate. Compliance with a variety of laws may require additional costs for sufficient controlling mechanisms or legal advice. Difficulties with enforcement of agreements and receivables in foreign legal systems may result in loss of revenue, depreciation, and lower cash flows. Changes in regulatory requirements may cause, among other things, expensive production reorganizations. Decision-making processes may become more complex, requiring more management resources. Trade wars, imposition of tariffs and export controls caused by geopolitical developments may impede supply chains and customer deliveries.
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We continue to explore expansion of our international operations in certain markets where we currently operate and in selected new or developing markets. New markets and developing markets can present many risks including the actions and decisions of local and national authorities and regulators, the imposition of limits on foreign ownership of local companies, changes in laws (including tax laws and regulations) as well as their application or interpretation, civil disturbances and political instability, difficulties in protecting intellectual property, fluctuations in the value of the local currency, restrictions that prevent us from transferring funds from these operations out of the countries in which they operate or converting local currencies we hold into U.S. dollars, British Pounds or other currencies, as well as other adverse actions by governmental authorities and regulators, such as the retroactive application of new requirements on our current and prior activities or operations. Additionally, evaluating or entering into a developing market may require considerable time from management, as well as start-up expenses for market development before any significant revenues and earnings are generated. Engaging with foreign representatives and consultants may be vital for the success of our operations in certain countries and hence create a significant dependency on their abilities. Operations in new markets may achieve low margins or may be unprofitable, and expansion in existing markets may be affected by local political, economic and market conditions. As we continue to operate our business internationally, our success will depend, in part, on our ability to anticipate and effectively manage these and other related risks. The impact of any one or more of these or other factors could adversely affect our business, financial condition or results of operations.
We generate revenues and incur costs in a number of currencies. Changes in economic or political conditions in any of the countries in which we operate could result in exchange rate movement, new currency or exchange controls or other restrictions being imposed on our operations or expropriation. Because our financial results are reported in U.S. dollars, if we generate revenue or earnings in other currencies, the translation of those results into U.S. dollars can result in a significant increase or decrease in the amount of those revenues or earnings.
Foreign exchange rates have seen significant fluctuation in recent years, and significant increases in the value of the U.S. dollar relative to foreign currencies could have a material adverse effect on the Group’s reported financial results.
Seasonal variations in demand linked to construction cycles and weather conditions may influence our results of operations and severe weather, including extreme weather conditions associated with climate change, may negatively affect our operations.
Our business is subject to seasonal variations in demand linked to weather conditions. The demand for our solutions, products and services from some countries may also be subject to significant seasonality due to adverse weather conditions. Furthermore, extreme weather conditions such as hurricanes, droughts, heat waves, fires, winter storms and other severe weather events associated with climate change could cause these seasonal fluctuations to be more pronounced. Seasonal variations and unseasonal weather could adversely affect our results of operations, including preventing our workforce from progressing projects as planned and making them more volatile and unpredictable.
Destruction caused by severe weather events, such as hurricanes, flooding, tornados, severe thunderstorms, snow and ice storms, can result in lost operating revenues due to outages, property damage including downed transmission and distribution lines, and additional and unexpected expenses to mitigate storm damage, any of which may have a material adverse impact on our business, results of operations and financial condition.
A deterioration or other negative change in economic or financial conditions in the countries in which we operate or in the global financial markets could have a material adverse effect on our business or results of operations.
Our business depends on the availability of third-party financing on attractive terms. If a deterioration, volatility, or other negative changes occurred in economic or financial conditions, either in the countries in which we operate or in the global financial markets in general, our access to such financing, or the terms on which we are able to access such financing, could be significantly and negatively affected. Financial markets are subject to periods of substantial volatility, and such volatility is difficult or impossible to predict in advance.
If we are unable to secure third party financing on commercially viable terms, this could have a material adverse impact on our business, prospects, operating results and financial condition.
Risks related to information systems, internal controls, cybersecurity, record keeping and reporting
Our operations depend on proper performance of various information technology systems.
The majority of our operational steps are covered by complex information technology (“IT”) systems and Enterprise-Resource-Planning (“ERP”) systems such as NetSuite. We rely on integrated IT systems, in particular for purposes of production planning, scheduling, control and quality assurance, recording our order intake, sales volumes and distribution, and maintaining our accounting systems. In addition, new IT systems are implemented continuously across our Group.
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Our IT systems may fail for a number of reasons in the future. Rapid growth of our business, fire, lightning, flooding, earthquake or other natural disasters, technological or human error or other events may cause disruptions. In addition, we may be the subject of cyber-attacks in the future, and we cannot ensure entirely that our IT security will successfully prevent such hacks, denial of service attacks, data theft or other cyber-attacks. Our back-up systems may fail to fully protect us against the effects of such events. Consequently, any failure of our IT systems could lead to difficulties meeting customers’ demands, delays in delivery, less effective hedging or accounting or risk management failures. Moreover, confidential or private information, including third-party information, may be leaked, stolen, or manipulated or compromised in other ways. In this event, we may also be subject to contractual penalties or claims for damages, administrative fines or other sanctions under secrecy, confidentiality, or data protection laws and regulations. Our insurance may not adequately cover potential damages which may reduce our customer base and ultimately result in lower revenue.
Security breaches, cyber-attacks, loss of data and other disruptions could compromise sensitive information related to our business or prevent us from accessing critical information and expose us to liability, which could adversely affect our business and our reputation.
We operate data center infrastructure that may be classified as critical infrastructure or essential services under applicable national security and digital resilience frameworks. As the Group expands its data center activities and leases space to sovereign entities, hyperscalers and other operators processing potentially sensitive data, the Group may become subject to enhanced regulatory requirements relating to data sovereignty, security clearance, ownership restrictions, facility access control and operational resilience. In Norway, facilities processing sensitive data may be subject to requirements under the Norwegian Security Act (Sikkerhetsloven) and related regulations, which could impose obligations regarding ownership structures, personnel vetting, physical security and operational reporting. In the EU, digital resilience frameworks such as the Digital Operational Resilience Act (DORA) may also impose additional cybersecurity and incident reporting obligations on the Group or its tenants. The Group processes personal data relating to employees, contractor personnel, commercial counterparties and site visitors, subjecting it to general data protection laws, including the EU General Data Protection Regulation (GDPR) and applicable national implementations. Any failure to comply with applicable data protection, cybersecurity or critical infrastructure requirements, or any material security breach, could result in administrative fines, regulatory investigations, third-party claims, restrictions on operations, loss of tenant confidence and reputational damage, which could have a material adverse effect on the Group’s business, financial condition, results of operations, cash flows and prospects.
In the ordinary course of our business, we collect, and store sensitive data, intellectual property and proprietary business information owned or controlled by ourselves or our customers. This data encompasses a wide variety of business-critical information including research and development information, commercial information, and business and financial information. We face four primary risks related to protecting this critical information: loss of access; inappropriate disclosure; inappropriate modification; and inadequate monitoring of our controls over the first three risks.
The secure processing, storage, maintenance, and transmission of this critical information is vital to our operations and business strategy, and we devote significant resources to protecting such information. Although we take measures to protect sensitive information from unauthorized access or disclosure, our information technology and infrastructure may be vulnerable to attacks by hackers or viruses, breaches, interruptions due to employee error, malfeasance, lapses in compliance with privacy and security mandates, or other disruptions. Any such breach or interruption could compromise our networks and the information stored there could be accessed by unauthorized parties, publicly disclosed, lost, or stolen.
Any such security breach or interruption, as well as any action by us or our employees or contractors that might be inconsistent with the rapidly evolving data privacy and security laws and regulations applicable within the United States and elsewhere where we conduct business, could result in enforcement actions by U.S. states, the U.S. federal government or foreign governments, liability or sanctions under data privacy laws that protect personally identifiable information, regulatory penalties, other legal proceedings such as but not limited to private litigation, the incurrence of significant remediation costs, disruptions to our development programs, business operations and collaborations, diversion of management efforts and damage to our reputation, which could harm our business and operations. Because of the rapidly moving nature of technology and the increasing sophistication of cybersecurity threats, our measures to prevent, respond to and minimize such risks may be unsuccessful.
The EU General Data Protection Regulation (the “GDPR”) has applied since May 2018 and governs the collection and use of personal data in the European Union. It also applies in Norway through the EEA Agreement. The United Kingdom has a corresponding regime, the UK GDPR and the Data Protection Act 2018. These laws are wide-ranging and impose requirements relating to the consent of the individuals to whom personal data relates, the information provided to them, the security and confidentiality of personal data, data breach notification and the use of third-party processors. They also restrict the transfer of personal data out of the EU and the UK, including to the United States, and provide for significant penalties for non-compliance. Under the GDPR, fines can reach €20 million or 4% of annual worldwide turnover, whichever is greater. While we have taken steps to comply, including reviewing our security procedures and entering into data processing agreements with relevant contractors, we cannot assure you that our efforts to remain in compliance will be fully successful.
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Further, unauthorized access, loss or dissemination of sensitive information could also disrupt our operations, including our ability to conduct research and development activities, process and prepare company financial information, manage various general and administrative aspects of our business and damage our reputation, any of which could adversely affect our reputation and our business. In addition, there can be no assurance that we will promptly detect any such disruption or security breach, if at all. To the extent that any disruption or security breach were to result in a loss of or damage to our data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability, and the further development of our products could be delayed.
We have material weaknesses in our disclosure controls and our internal control over financial reporting. If we fail to remediate any material weaknesses or if we fail to establish and maintain effective control over financial reporting, our ability to accurately and timely report our financial results could be adversely affected.
Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) under the Exchange Act. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of annual or interim financial statements will not be prevented or detected on a timely basis.
Our failure to remediate the material weaknesses or the identification of additional material weaknesses in the future could adversely affect our ability to report financial information, including our filing of quarterly or annual reports with the SEC on a timely and accurate basis. Moreover, our failure to remediate the material weaknesses identified above or the identification of additional material weaknesses could prohibit us from producing timely and accurate financial statements, which may adversely affect the market price of shares of our common stock. The Company is committed to resolving the material weaknesses by enhancing its accounting and finance department, implementing a new organization wide ERP system with an inherent robust control structure, and utilizing external expertise related to all aspects of internal control environments.
We have restated our previously issued consolidated financial statements, which may adversely affect investor confidence, our share price and our ability to raise capital, and may expose us to litigation or regulatory action.
As described in Note 35 to our consolidated financial statements, we have restated our consolidated financial statements as of and for the year ended June 30, 2025. The restatement, and the material weaknesses in our internal control over financial reporting described above, may cause investors to lose confidence in our reported financial information, may adversely affect the trading price of our Class A Ordinary Shares and may make it more difficult or costly for us to raise capital. We have incurred, and expect to continue to incur significant professional fees and management time in connection with the restatement and the related remediation. We may also become subject to shareholder claims, regulatory inquiries or investigations by the SEC or Nasdaq arising from the restatement, which could result in costs, penalties or other adverse consequences. Any further restatement or failure to file our periodic reports on a timely basis could result in the loss of eligibility to use short-form registration statements, which would impair our ability to access the capital markets.
The accounting treatment for many aspects of our business is complex and any changes to the accounting interpretations or accounting rules governing our business could have a material adverse effect on our reported results of operations and financial results.
The accounting treatment for many aspects of our business is complex, and our future results could be adversely affected by changes in the accounting treatment applicable to our business. In particular, any changes to the accounting rules regarding the following matters may require us to change the manner in which we operate and finance our business:
| ● | revenue recognition and related timing; | |
| ● | intercompany contracts; | |
| ● | operation and maintenance contracts; | |
| ● | long-term vendor agreements; and | |
| ● | foreign holding company tax treatment. |
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We make estimates and assumptions in connection with the preparation of our consolidated financial statements, and any changes to those estimates and assumptions could have a material adverse effect on our reported results of operations.
In connection with the preparation of our consolidated financial statements included in this report, we used certain estimates and assumptions, which are more fully described in Notes 2 and 3 of the consolidated financial statements. The estimates and assumptions we use in the preparation of our consolidated financial statements affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable, the results of which form the basis for making judgements about the carrying values of assets and liabilities that are not readily apparent from other sources. Changes in accounting estimates are reasonably likely to occur from period to period. Accordingly, actual results could differ significantly from our estimates. While we believe that these estimates and assumptions are reasonable under the circumstances, they are subject to significant uncertainties, some of which are beyond our control. Should any of these estimates and assumptions change or prove to have been incorrect, it could have a material adverse effect on our financial statement presentation, financial condition, results of operations and cash flows, any of which could cause our stock price to decline.
We currently report our financial results under IFRS, which differs in certain significant respects from U.S. GAAP.
We report on our financial statements under IFRS. There have been and there may be in the future certain significant differences between IFRS and U.S. GAAP, including but not limited to differences related to revenue recognition, share-based compensation expense, income tax, impairment of long-lived assets and loss per share. As a result, our financial information and reported earnings for historical or future periods could be significantly different if they were prepared in accordance with U.S. GAAP. As a result, you may not be able to meaningfully compare our financial statements under IFRS with those companies that prepare financial statements under U.S. GAAP.
Risks related to regulations and governance
Changes in Norwegian regulation of data centers, including proposed restrictions on crypto-mining data centers, could adversely affect the Mo i Rana Data Center.
Data centers in Norway are subject to registration and security requirements under the Norwegian Electronic Communications Act and the regulations on data center operations that came into force on January 1, 2025, and to planning, grid-connection and electricity tax rules. On March 12, 2026, the Norwegian Parliament (Storting) adopted a resolution asking the Government to propose a ban on the establishment of new data centers for crypto-mining, and the Government has indicated that it will assess the use of a state planning provision under the Planning and Building Act. The scope and timing of any such measures, and whether they would affect existing facilities or hosting arrangements, are uncertain. The Mo i Rana Data Center currently generates revenue from hosting arrangements with a digital asset mining customer. Any ban, restriction, change in the electricity tax treatment of data centers, or failure to maintain our registration or comply with notification requirements could require us to terminate or restructure those arrangements earlier than planned, delay the approval of additional capacity, increase our costs or subject us to sanctions, any of which could have a material adverse effect on our business, financial condition and results of operations.
Regulations and policies governing electric vehicles may materially adversely affect the adoption of electric vehicles and hence the demand for and/or financial viability of our electric vehicle business.
Electric vehicle sales are subject to foreign, federal, state and local laws, rules, regulations and policies which affect both demand and supply. These include incentives for purchase as well as manufacturing. Should these incentives be removed or reduced, the demand and/or supply of electric vehicles may decline. In addition, each jurisdiction will have their own laws, rules and regulations in relation to on-road usage of electric vehicles, including homologation requirements.
Electric vehicles are also subject to industry specific laws, rules and regulations for use in different industries. For example, there are specific mining regulations which define certain technical and safety requirements that must be met in order for electric vehicles to be eligible for use on mine sites. Road use of our electric vehicles will also require adhering to local laws and regulations in order to be operated on public roads.
These laws, rules and regulations may adversely affect the technical and economic viability of our Tembo EUV products and solutions which in turn could have a material adverse effect on our business, results of operations and financial condition.
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Changes in tariffs, trade policies and related geopolitical developments could increase our costs, disrupt our supply chain, and reduce demand for our products, which could materially and adversely affect our business, financial condition, and results of operations.
We source components and services globally, including from Asia, and rely on cross-border logistics. Increases in existing tariffs, the imposition of new tariffs or quotas, export controls or sanctions, retaliatory measures by other jurisdictions, or changes to trade agreements could (i) raise input and freight costs (including batteries, electronic components and finished kits), (ii) delay or disrupt production and deliveries, (iii) constrain access to certain technologies or financial services, and (iv) reduce customer demand in affected markets. These factors may also increase working-capital needs, complicate supplier relationships, and require pricing or sourcing changes that we may be unable to implement on acceptable terms or timing. Prolonged or escalating trade tensions could therefore adversely impact on our margins, cash flows and growth plans.
Changes to our tax liabilities or changes to tax requirements in the jurisdictions in which we operate could significantly and negatively affect our profitability.
We are subject to income taxes and potential tax examinations in various jurisdictions, and taxing authorities may disagree with our interpretations of U.S. and foreign tax laws and may assess additional taxes. The taxes ultimately paid upon resolution of such examinations could be materially different from the amounts previously included in our income tax provision, which could have a material impact on our profitability and cash flow. Moreover, changes to our operating structure, losses of tax holidays, changes in the mix of earnings in countries with tax holidays or differing statutory tax rates, changes in tax laws, and the discovery of new information in the course of our tax return preparation process could each have a negative impact on our tax burden and therefore our financial condition. Changes in tax laws or regulations or interpretations may also increase tax uncertainty and adversely affect our results of operations. Any increase in corporation or other tax rates to which the Company is exposed or adverse changes in the basis of calculation could result in the Company paying higher taxes and could have an adverse impact on the Company’s cash flows, financial condition, and results of operations.
Changes in, or any failure to comply with, privacy laws, regulations, and standards may adversely affect our business.
The regulatory framework for privacy and security issues worldwide is rapidly evolving and is likely to remain uncertain for the foreseeable future. Governmental bodies around the world have adopted, and may in the future adopt, laws and regulations affecting data privacy. Industry organizations also regularly adopt and advocate new standards in this area. In addition to government regulation, privacy advocates and industry groups may propose new and different self-regulatory standards that apply to us. Any changes in such laws, regulations or standards may result in increased costs to our operations, and any failure by us to comply with such laws, regulations and standards may have a significant and negative impact on our business or reputation.
As a foreign private issuer under the rules and regulations of the SEC, we are exempt from a number of rules under U.S. securities laws that apply to U.S.-based issuers and are permitted to file less information with the SEC than such companies.
We are a “foreign private issuer” under the rules and regulations of the SEC. As a result, we are not subject to all of the disclosure requirements applicable to U.S.-based issuers. For example, we are exempt from certain rules under the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”), that impose disclosure and procedural requirements related to the solicitation of proxies, consents or authorizations applicable to securities registered under the Exchange Act. In addition, we are not required to file periodic reports and consolidated financial statements with the SEC as frequently or as promptly as U.S.-based public companies. As a result, there may be less publicly available information concerning our Company than there is for U.S.-based public companies. Furthermore, although since March 18, 2026 our directors and officers have been subject to the beneficial ownership reporting requirements of Section 16(a) of the Exchange Act as a result of the Holding Foreign Insiders Accountable Act, they remain exempt from the “short-swing” profit recovery provisions of Section 16(b) and the short-sale restrictions of Section 16(c) of the Exchange Act, and our principal shareholders that are not directors or officers are not subject to Section 16.
U.S. holders of our shares could be subject to material adverse tax consequences if we are considered a “passive foreign investment company” for U.S. federal income tax purposes.
We do not believe that we were a passive foreign investment company (a “PFIC”) for U.S. federal income tax purposes for our taxable year ended June 30, 2026, and we do not expect to be a PFIC for our current taxable year ending June 30, 2027. However, the determination of whether we are a currently, or may become in the future, a PFIC, depends on the particular facts and circumstances (such as the valuation of our assets, including goodwill and other intangible assets) and may also be affected by the application of the PFIC rules, which are subject to differing interpretations. Because that factual determination is made annually after the end of each taxable year, there can be no assurance that we will not be considered a PFIC for the current taxable year or any future taxable years.
If we are a PFIC, U.S. holders of our Class A Ordinary Shares would be subject to adverse U.S. federal income tax consequences, such as ineligibility for any preferred tax rates on capital gains or on actual or deemed dividends, interest charges on certain taxes treated as deferred, and additional reporting requirements under U.S. federal income tax laws and regulations. A U.S. holder of our Class A Ordinary Shares may be able to mitigate some of the adverse U.S. federal income tax consequences described above with respect to owning the Class A Ordinary Shares if we are classified as a PFIC, provided that such U.S. investor is eligible to make, and validly makes, a “mark-to-market” election. In certain circumstances a U.S. Holder can make a “qualified electing fund” election to mitigate some of the adverse tax consequences described with respect to an ownership interest in a PFIC by including in income its share of the PFIC’s income on a current basis. However, we do not currently intend to prepare or provide the information that would enable a U.S. Holder to make a qualified electing fund election.
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Investors should consult their own tax advisors regarding all aspects of the application of the PFIC rules to our Class A Ordinary Shares. For more information related to classification as a PFIC, see Certain Material U.S. Federal Income Tax Considerations — Passive Foreign Investment Company Considerations.
We may lose our foreign private issuer status in the future, which could result in significant additional costs and expenses.
As a foreign private issuer, we are not required to comply with all the periodic disclosure and current reporting requirements of the Exchange Act and related rules and regulations. In the future, we would lose our foreign private issuer status if we failed to meet the requirements set forth in Rule 405 of the Securities Act of 1933, as amended (the “Securities Act”). If we were to lose our status as a foreign private issuer, we would become subject to the regulatory and compliance costs associated with being a U.S. domestic issuer under U.S. securities laws, rules and regulations and stock exchange requirements, which costs may be significantly greater than costs we incur as a foreign private issuer. We would be required under current SEC rules to prepare our consolidated financial statements in accordance with U.S. GAAP and modify certain of our policies to comply with corporate governance practices associated with U.S. domestic issuers. These requirements would be additional to, and not in place of, those under U.K. law to prepare consolidated financial statements under IFRS and comply with applicable U.K. corporate governance laws. If we do not qualify as a foreign private issuer, we will be required to file periodic reports and registration statements on U.S. domestic issuer forms with the SEC, which are more detailed and extensive in certain respects than the forms available to a foreign private issuer. Such conversion and modifications will involve additional costs, both one-off in nature on conversion and ongoing costs to meet reporting in both U.S. GAAP and IFRS, which would reduce our operating profit. In addition, we may lose our ability to rely upon exemptions from certain corporate governance requirements on U.S. stock exchanges that are available to foreign private issuers. Therefore, the additional costs that we would incur if we lost our foreign private issuer status could have a significant and negative impact on our financial condition, operating results or cash flows.
U.S. investors may have difficulty enforcing civil liabilities against our Company, our directors or members of senior management and the experts named in this report.
Most of our directors and the experts are non-residents of the United States, and all or a substantial portion of the assets of such persons are located outside the United States. As a result, it may not be possible to serve process on such persons or us in the United States or to enforce judgements obtained in U.S. courts against them or us based on civil liability provisions of the securities laws of the United States. There may be doubt as to whether the courts of England and Wales would accept jurisdiction over and enforce certain civil liabilities under U.S. securities laws in original actions or enforce judgements of U.S. courts based upon these civil liability provisions. In addition, awards of punitive damages in actions brought in the United States or elsewhere are likely to be unenforceable in England and Wales (an award for monetary damages under the U.S. securities laws may be considered punitive if it does not seek to compensate the claimant for loss or damage suffered and appears to be intended to punish the defendant). The enforceability of any judgement in England and Wales will depend on a number of criteria, including public policy, as well as the laws and treaties in effect at the time. The United States and the U.K. do not currently have any treaties providing for recognition and enforcement of judgements (other than arbitration awards) in civil and commercial matters.
From time to time, we may become involved in costly and time-consuming litigation and other regulatory proceedings which require significant attention from our management.
In addition to potential litigation related to defending our intellectual property rights, we may be named as a defendant from time to time in other lawsuits and regulatory actions relating to our business, some of which may claim significant damages.
Tembo supplier disputes. Tembo disputes invoices of approximately £140,000 from BMS Design for a vehicle development project, and the matter remains under negotiation. Podium Engineering S.r.l. claimed EUR 192,500 in unpaid fees before the Tribunal of Aosta, Italy. A European Order for Payment of EUR 213,049 was issued in November 2024, Tembo opposed it in March 2025, and the parties agreed a settlement of EUR 150,000. NMW Groep B.V. and J.M. Hebels Holding B.V. brought proceedings against Tembo E-LV B.V. and VivoPower PLC, which guaranteed Tembo’s obligations, over the lease of premises in Eindhoven. On July 2, 2026, the court dismissed a significant portion of the claims and awarded EUR 44,046 in total, including statutory interest and legal costs, which was paid after year end. ComplianceQuest Inc. claimed US$200,891 in unpaid software fees, and the matter settled for US$75,000 and was dismissed.
In May 2026, VivoPower International Services Limited (“VISL”) settled a claim by Workato over unpaid software invoices for US$42,500, payable in five monthly instalments from June 18, 2026 to October 19, 2026, with a mutual release and no admission of liability. In October 2025, we settled a dispute with Accès Industriel Mining, Inc. over electric vehicle conversion equipment, without admission of liability. Total payments were US$557,229, and the final payment was made on July 2, 2026.
In FY24, HMRC cancelled the VAT registrations of VivoPower PLC, on the basis that its VAT claim had no merit, and of VISL, due to outstanding payments. Both have lodged appeals. In April 2026, VISL agreed a payment arrangement with HMRC for outstanding PAYE and VAT of approximately £1.21 million, including interest. It paid £127,555.77 in March 2026 and agreed to monthly payments of approximately £48,400 from May 2026, with the final payment due in May 2028. In August 2025, the Norwegian Tax Administration began an audit of Nordland Data AS (now Arctic Norge Data I AS) covering VAT and corporate income tax from January 2022 to February 2025. The audit is ongoing, and no adverse findings, proposed adjustments, liabilities or penalties have been assessed to date.
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In addition to the foregoing litigation, we may be subject in the future to, or may file ourselves, claims, lawsuits or arbitration proceedings related to matters in tort or under contracts, employment matters, securities class action lawsuits, whistleblower matters, tax authority examinations or other lawsuits, regulatory actions or government inquiries and investigations. Due to the inherent uncertainties of litigation and regulatory proceedings, we cannot accurately predict the ultimate outcome of any such proceedings. An unfavorable outcome could have a material adverse impact on our business and financial condition, results of operations or cash flows or limit our ability to engage in certain of our business activities. In addition, regardless of the outcome of any litigation or regulatory proceedings, such proceedings are often expensive, lengthy, disruptive to normal business operations and require significant attention from our management.
We are subject to the U.K. Bribery Act, the U.S. Foreign Corrupt Practices Act (“FCPA”) and other anti-corruption laws, as well as export control laws, import and customs laws, trade and economic sanctions laws and other laws governing our operations.
Our operations are subject to anti-corruption laws, including the U.K. Bribery Act 2010, or the Bribery Act, the FCPA, the U.S. domestic bribery statute contained in 18 U.S.C. §201, the U.S. Travel Act, and other anti-corruption laws that apply in countries where we do business. The Bribery Act, the FCPA and these other laws generally prohibit us and our employees and intermediaries from authorizing, promising, offering, or providing, directly or indirectly, improper or prohibited payments, or anything else of value, to government officials or other persons to obtain or retain business or gain some other business advantage.
Under the Bribery Act, we may also be liable for failing to prevent a person associated with us from committing a bribery offense. We, and those acting on our behalf, operate in a number of jurisdictions that pose a high risk of potential Bribery Act or FCPA violations, and we participate in collaborations and relationships with third parties whose corrupt or illegal activities could potentially subject us to liability under the Bribery Act, FCPA or local anticorruption laws, even if we do not explicitly authorize or have actual knowledge of such activities. In addition, we cannot predict the nature, scope or effect of future regulatory requirements to which our international operations might be subject or the manner in which existing laws might be administered or interpreted. Furthermore, compliance with the Bribery Act, the FCPA and these other laws is expensive and difficult, particularly in countries in which corruption is a recognized problem.
We are may become subject to the U.K. failure to prevent fraud offence introduced under the Economic Crime and Corporate Transparency Act 2023. Under this legislation, a large organization may be held criminally liable where an employee or agent commits certain fraud offences for the benefit of the organization or persons to whom the organization provides services, unless the organization can demonstrate that it had reasonable procedures in place to prevent fraud. If we fail to comply with these requirements, we could be subject to criminal penalties and other sanctions, which could have a material adverse effect on our reputation, business, financial condition and results of operations.
We are also subject to other laws and regulations governing our international operations, including regulations administered by the governments of the United States and the U.K., and authorities in the European Union, including applicable export control regulations, economic sanctions and embargoes on certain countries and persons, anti-money laundering laws, import and customs requirements and currency exchange regulations, collectively referred to as Trade Control laws.
There is no assurance that we will be completely effective in ensuring our compliance with all applicable anti-corruption laws, including the Bribery Act, the FCPA or other legal requirements, including Trade Control laws. If we are not in compliance with the Bribery Act, the FCPA and other anti-corruption laws or Trade Control laws, we may be subject to criminal and civil penalties, disgorgement and other sanctions and remedial measures, and legal expenses, which could have an adverse impact on our business, financial condition, results of operations and liquidity. Likewise, any investigation of any potential violations of the Bribery Act, the FCPA, other anti-corruption laws or Trade Control laws by United States, U.K. or other authorities could also have an adverse impact on our reputation, our business, results of operations and financial condition. Further, the failure to comply with laws governing international business practices may result in substantial civil and criminal penalties and suspension or debarment from government contracting.
Any such violation, even if prohibited by our policies, could subject us and such persons to criminal and/or civil penalties or other sanctions, which could have a material adverse effect on our reputation and results of operations.
Risks related to attracting and retaining talent
Our future success depends on our ability to retain our chief executive officer and other key executives.
We are highly dependent on Kevin Chin, our Chairman and Chief Executive Officer, and other principal members of our management team. Although we have formal employment agreements with each of our executive officers, these agreements do not prevent our executives from terminating their employment with us. We do not maintain “key person” insurance on any of our executive officers. The unplanned loss of the services of any of these persons could materially impact on our business and results of operations.
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The success of our Company is heavily dependent on the continuing services of key personnel as well as the recruitment and retention of additional personnel.
Our business depends on the experience, industry knowledge and commercial relationships of its management team and key employees, including within data center development, power procurement, engineering, project financing and commercial leasing. Key members of the management team possess specialized expertise that is critical to the Group’s strategy. The Group currently has approximately 14 full-time employees across five global offices. As the Group’s project portfolio expands, its success will depend on its ability to attract, recruit, integrate and retain additional qualified personnel across data center development, power procurement, energy markets, data center engineering, project management and commercial structuring. There is a risk that we will be unable to retain key personnel or attract and integrate new employees on a timely basis or on acceptable terms. Any failure to build organizational capacity in line with our growth could delay project development, reduce execution capacity or weaken our ability to identify and realize new opportunities, which could have a material adverse effect on our business, financial condition, results of operations and prospects.
We have a small executive team operating across multiple time zones, and the loss of one or more key individuals could materially impair our ability to execute time-sensitive transactions, manage relationships with counterparties, or maintain effective internal controls.
The industries we operate in are characterized by strong competition for personnel. Moreover, our growth plans may necessitate us to hire additional personnel in the future. If we are not able to attract and retain such personnel, our ability to realize our growth objectives will be compromised. In addition, talented employees may choose to leave the Company because of competing companies offering better remuneration packages or they prefer to embrace a different lifestyle. When talented employees leave, we may have difficulty replacing them and our business may suffer. While we strive to maintain our competitiveness in the marketplace, there can be no assurance that we will be able to successfully retain the employees that we need to achieve our business objectives.
The loss of one or more of our key management or operating personnel, or the failure to attract and retain additional key personnel, could have a material adverse impact on our business, results of operations, financial condition and prospects.
ITEM 4. INFORMATION ON THE COMPANY
A. History and Development of the Company
VivoPower was incorporated on February 1, 2016, under the laws of England and Wales, with company number 09978410, as a public company limited by shares. It listed on Nasdaq in December 2016.
VivoPower became a B Corporation in April 2018 and recertified in 2021. In 2022, B Lab UK recognized us in its Best for the World program for Governance. In June 2026, we recertified as a Certified B Corporation, extending our B Corp status to 2028.
On November 5, 2020, the Company completed the acquisition of 51% of Tembo e-LV B. V. and its subsidiaries: Tembo 4x4 B.V. and FD 4x4 Center B.V. (“Tembo”) for a total consideration of €4.0 million. On February 2, 2021, the Company acquired the remaining 49% of Tembo e-LV for €1.8 million cash consideration and €0.2 million of Class A Ordinary Shares. The primary business activity of Tembo is assembly of ruggedized electric vehicles and related products, suitable for use in off-road and ruggedized environments, including mining, infrastructure, utilities, government services, humanitarian, tourism and agriculture sectors. Tembo’s capabilities are an important element of VivoPower’s sustainable energy solutions strategy and offering.
On June 30, 2021, the Company acquired the remaining 50% interest in its joint venture, Caret, from the other joint venture partner, Innovative Solar Systems, LLC (“ISS”), for $1. The primary business activity of Caret is the development of utility scale solar farms in the U.S.
On July 1, 2022 the Company disposed of the business and assets of J.A. Martin except its solar division and the business and assets of Non-Destructive Testing Services in a sale to ARA Group Limited (ARA).
On July 2, 2024, the Company disposed of the business and assets of Kenshaw Electrical, its critical power services business in Australia, in a further sale to ARA Electrical Engineering Services Pty Limited.
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In January 2025, VivoPower was named a 2025 Real Leaders Top Impact Company, recognizing its leadership in sustainable business practices and positive social and environmental contributions. This recognition related to our sustainable business practices at that time, when our offerings included electric vehicle, battery storage and microgrid solutions.
In May 2025, we announced a digital asset and decentralized finance strategy with a primary focus on XRP, under which we intended to allocate a portion of our treasury assets to digital assets. The strategy was intended to provide diversification and yield on our treasury holdings and to support our ability to raise capital. In February 2026, we announced that we would not acquire digital assets on our balance sheet and that we would focus on our data center infrastructure business. We discontinued the strategy and do not hold digital assets directly.
Concurrently with the launch of our digital asset strategy, on May 28, 2025 we entered into a Regulation S subscription agreement with a consortium led by Ceres Holding Limited, an entity associated with HRH Prince Abdulaziz bin Turki bin Talal Al Saud, Chairman of Eleventh Holding Company, for 20.0 million Class A Ordinary Shares at US$6.05 per share, a total of US$121.0 million, in two tranches of US$60.5 million each. The first tranche is recognized in our financial statements as a subscription receivable.
In January 2026, the Company acquired 41,810 shares in a privately held company at US$118.712 per share, for an aggregate cost of US$5.0 million. In April 2026, 882 of these shares were sold pursuant to a buyback offered by the investee at US$300 per share, generating proceeds of US$264,600. The remaining 40,928 shares are subject to completion of executed sale agreements with Korean-based partners of the Company. In connection with these proposed transactions, the Company made a payment of US$4,352,863 towards a proposed investment in a company listed on the KOSDAQ market.
Tembo e-LV BV entered into a convertible note arrangement in connection with a proposed strategic investment in EnduroCo Pty Ltd, an Australian electric vehicle technology company. Under the arrangement, Tembo e-LV BV agreed to subscribe for unsecured convertible notes with an aggregate principal amount of A$16.0 million, bearing interest at 5% per annum. The notes provide Tembo with a right, at its discretion, to convert the amounts advanced into an equity interest in EnduroCo in accordance with the terms of the related share purchase agreement. Upon exercise of the conversion right and completion of the initial purchase, Tembo would acquire a controlling interest in EnduroCo. As of June 30, 2026, US$1.12 million had been advanced under the convertible note arrangement. The amount represents an advance under the financing and proposed investment arrangement.
On 6 January 2026, the Company entered into a share purchase agreement to acquire 100% of the shares in VivoPower Norge Infrastructure AS (fka Cromwell AS), together with its operating subsidiary Arctic Norge Data I AS (fka Nordland Data AS). The acquired group owns and operates an energized 41.5 MW data-center facility in Mo i Rana, Norway, powered by 100% renewable hydroelectric energy. The acquisition completed on 12 May 2026 following receipt of the required approvals. The acquisition supports the Group’s strategic expansion into powered-land and digital-infrastructure activities and adds an operational, recurring cash generating data-center business to the Group.
On 16 March 2026, the Company changed its registered name from VivoPower International PLC to VivoPower PLC. The change of name did not result in any change to the legal entity or its operations. The Company’s Nasdaq ticker symbol was also changed from VVPR to VIVO.
During the year, our shareholders authorized the directors to allot shares up to an aggregate nominal amount of US$116,400,000 (equivalent to 970 million Class A Ordinary Shares)
Corporate and Other Information
Company Information
Advisors
| Company Registrars | Legal Advisers | |
| Computershare
Inc. 250 Royall Street Canton, MA, USA 02021 Correspondence address: Computershare Inc. P.O. Box 505000 Louisville, KY, USA 40233 |
UK
counsel: Shoosmiths LLP 1 New Change London, UK, EC4M 9DQ US counsel: Rimon P.C. Quay Quarter Tower Level 2 50 Bridge Street Sydney, NSW 2000 Australia | |
| Independent Auditors | Principal Bankers | |
WithumSmith+Brown,
PC (independent registered public accounting firm; PCAOB ID 100) 506 Carnegie Center #400 Princeton, New Jersey 08540
Menzies
LLP (UK statutory auditor) |
Revolut
Ltd 7 Westferry Circus Canary Wharf London, UK E14 4HD | |
| Company Secretary | ||
| Gary Challinor |
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Shareholder Information
As of 30 June 2026, the Company’s issued share capital is set out in Note 27 to the consolidated financial statements.
VivoPower PLC is incorporated in England & Wales. The Company operates in the United Kingdom, United States, Australia, United Arab Emirates, the Netherlands, Norway and the Philippines.
Company Registration
Registered office: Suite 4, 7th Floor, 50 Broadway, London, UK SW1H 0DB
Registered in England & Wales Company number: 09978410
Financial Calendar
The Company’s AGM was held on December 15, 2025.
Our telephone number is +44-203-667-5158 and our internet address is https://www.vivopower.com. Our website and the information contained on or accessible through our website are not part of this report. Our agent for service of process in the U.S. is CSC Global / The Law Debenture Trust. The SEC maintains an internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC (http://www.sec.gov).
B. Business Overview
VivoPower PLC (formerly VivoPower International PLC) is a B Corporation that develops and owns powered land and data center infrastructure for AI compute applications. Its principal operating asset is an energized 41.5 MW data center at Mo i Rana, Norway, acquired in the year ended 30 June 2026. The Group also owns Tembo e-LV B.V. (“Tembo”), an electric vehicle business, and Caret, LLC (“Caret”), which holds legacy U.S. solar and digital asset activities. The Group has operations and personnel in Australia, the Netherlands, the United Kingdom, the United States, the Philippines and Norway.
On 23 December 2025, the Company announced a refocus of Group resources on a Power-to-X strategy under which the priority use of controlled power and land is sovereign AI compute infrastructure. On July 6, 2026, we announced that the Board had determined that the principal strategic priority of the Group is the development and scale-up of its AI data center business, and that the separation of Tembo and Caret, each described as a non-core business, would be progressed consistently with that priority. The digital asset and decentralized finance strategy launched in May 2025 is a prior strategy and is not the Group’s current principal activity.
The Company announced a change of corporate name from VivoPower International PLC to VivoPower PLC and a change of Nasdaq ticker from VVPR to VIVO, effective on 16 March 2026, in connection with its stated focus on powered land and data center infrastructure. The name change does not affect shareholders’ rights.
On 16 June 2026, the Company announced that it had been recertified as a Certified B Corporation, extending continuous B Corp status, first obtained in April 2018, to 2028. The Company reported a verified B Impact Score of 86.6, compared with 83.0 at the 2021 recertification and 85.7 at the 2018 certification. The Company also announced that Tembo e-LV B.V. had qualified to use the B Corp logo on its website under B Lab brand rules.
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Management analyzes the Group’s business across six reportable segments: Electric Vehicles, Sustainable Energy Solutions, Solar Development, Digital Assets, Data Center, and Corporate Office.
The Critical Power Services segment, previously represented by VivoPower’s wholly owned subsidiary Aevitas and its subsidiaries Kenshaw Electrical Pty Limited (“Kenshaw”) and Kenshaw Solar Pty Ltd (formerly J.A. Martin Electrical Pty Limited), has been discontinued following the sale of Kenshaw to ARA Group Limited in July 2024. Accordingly, Critical Power Services is no longer considered an operating segment.
On 12 May 2026, the Group completed the acquisition of the Mo i Rana data center in Norway, an energized 41.5 MW facility powered by hydroelectric energy. The facility currently earns revenue from hosting a customer’s digital asset mining equipment under the hosting agreement and from participation in the grid demand response program. For the year ended 30 June 2026, the Data Center is a separate operating segment. Solar Development and Digital Assets are older activities and are separate from the hosting at Mo i Rana.
Electric Vehicles
Tembo is the electric vehicle business unit and brand that VivoPower fully acquired in February 2021. It has operating subsidiaries in Europe, Australia, the Middle East and Asia, and partners in Africa and North America. Founded in the Netherlands in 1969 as a specialist off-road vehicle ruggedization and modification company, Tembo designs and produces battery-electric solutions for utility and other off-road and ruggedized or customized on-road applications. These include conversion kits that convert internal combustion engine (“ICE”) vehicles into battery-electric vehicles (“EVs”) for fleet owners in the mining, agriculture, energy utility, defense, police, government, public transport, humanitarian and game safari sectors. Tembo also designed and engineered the Tembo Tusker, its first original equipment manufacturer (“OEM”) light utility battery-electric pick-up truck.
Tembo has four product lines: (i) Tembo EUV, utility vehicle (“EUV”) battery-electric conversion kits; (ii) Tembo PUV, public utility vehicle (“PUV”) battery-electric conversion kits for Jeepneys in the Philippines; (iii) Tembo EVP, electric vehicle products, which includes the Tembo Tusker and related services; and (iv) Tembo SES, a portfolio of EV charging solutions for home and commercial applications.
Tembo’s EUV conversion architecture is designed on a “plug and play” basis so that partners can install and maintain kits on left-hand or right-hand drive and 2-door or 4-door vehicles, and so that components can be replaced as technologies change.
In June 2024, VivoPower announced the Australian launch of the Tembo Tusker, a fully electric single and dual cab pick-up truck, at a launch price from A$74,000 plus GST and on-road costs, with 65 kWh and 77 kWh battery options and stated ranges of 330 km to 400 km. In November 2024, the Tusker secured full on-road homologation in Australia and New Zealand.
On August 29, 2024, VivoPower announced that Tembo executed a definitive Business Combination Agreement at a combined enterprise value of $904 million with CCTS. An independent third-party fairness opinion was satisfactorily completed, and the BCA was signed after a four-month period of due diligence.
In October 2024, Tembo entered a definitive agreement with Sarao Motors, a leading Jeepney manufacturer in the Philippines. The collaboration aims to electrify the country’s Jeepney fleet, targeting the estimated $10 billion Philippine Jeepney market. This partnership supports Tembo’s strategy to expand into Southeast Asia while contributing to the region’s transport decarbonization efforts.
In December 2024, Tembo announced it will launch its EUV25 ePower conversion kits for Toyota LandCruisers at Automechanika Dubai 2024, one of the largest global automotive trade shows, with an estimated 60,000 attendees from 160 countries. The EUV25 kits are designed for electrifying LandCruisers used in sectors like mining, construction, and safari tourism, further supporting Tembo’s strategy to decarbonize off-road fleet vehicles.
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In January 2025, VivoPower confirmed that Tembo is on track to fulfill orders and commence deliveries of its Tembo Tuskers electric utility vehicles (EUVs) from Sydney, Australia, in February 2025. The deliveries are part of Tembo’s subscription program, targeting mining and industrial fleet operators in Australia. This milestone supports Tembo’s commitment to providing ruggedized EV solutions for demanding sectors.
In February 2025, Tembo signed a definitive supply agreement with Asilia Africa, a safari operator, for the supply of Tembo EUVs to support its safari operations across East Africa. In April 2025, Tembo received an inaugural EV conversion kit order from The Safari Collection in Kenya. Both orders have been delivered.
In March 2025, VivoPower’s Tembo signed a Heads of Agreement with Associated Vehicle Assemblers Ltd. (AVA), East Africa’s leading vehicle assembler. The agreement sets out terms for assembling Tembo’s electric utility vehicles (EUVs) in Kenya, targeting regional markets in East and Southern Africa. This partnership supports Tembo’s strategy to localize assembly and distribution while contributing to regional decarbonization efforts.
In April 2025, Tembo signed a Definitive Distribution Agreement with Green Watt, a Saudi Arabian energy and environmental solutions provider, to sell and distribute 1,600 Tembo EUVs in the Kingdom of Saudi Arabia over five years, with an estimated value of up to $85 million.
In May 2025, VivoPower received a revised non-binding proposal from Energi Holdings for the acquisition of a 51% direct stake in Tembo e-LV. The proposal valued Tembo at an enterprise value of $200 million, reflecting Energi’s increased conviction in Tembo’s market potential and ongoing strategic discussions.
In June 2025, the company advanced the proposed Tembo transaction following completion of the second phase of Energi Holdings’ due diligence. This step reinforced Energi’s intent and provided greater visibility on the structure and potential timing of the transaction, which continues to be anchored on the $200 million valuation.
In August 2025, the company confirmed that Tembo remains on track for a $100 million investment from Energi Holdings, at a $200 million enterprise value, now expected to be executed via a SPAC transaction. This reaffirmation followed further progress on regulatory and transactional preparations, providing additional confidence in the deal’s completion.
On 18 August 2025, the Company announced that it had reached agreement with Energi Holdings Limited (“Energi”) under which Energi would acquire a 51% shareholding in Tembo through a strategic PIPE investment at a stated total enterprise valuation of $200 million, enabling the business combination with CCTS to resume. The purchase price for the 51% stake was described as derived from that enterprise valuation, adjusted for net debt and other customary adjustments at closing, and the announcement described the CCTS combination as supported by Energi at an equity valuation of $838 million. The $200 million and $838 million figures are transaction valuations and not fair values.
On 29 December 2025, the Company announced that a registration statement on Form F-4 for the proposed business combination had been submitted to the SEC on a confidential basis. On 26 March 2026, the Company announced that Nasdaq had approved the ticker “TEMB” for a planned Tembo listing at a targeted valuation of $838 million. In a Form 6-K furnished on 6 July 2026, the Company stated that the Form F-4 remained under SEC review and that, subject to completion of that review, CCTS shareholder approvals and other closing conditions, the combined entity is contemplated to be named Tembo Group N.V. and listed on Nasdaq, with the Company retaining a minority shareholding. The same Form 6-K stated that the special dividend and record date arrangements referred to in a 9 June 2025 press release are no longer operative and are superseded by the BCA and the Form F-4 if declared effective. The Company is seeking approval from CCTS shareholders for a one-year extension in connection with the Form F-4, and a shareholders’ meeting is expected to be held in November 2026. The business combination has not been completed and no assurance can be given that the extension will be approved or that the combination will be completed on the terms or timetable contemplated, or at all.
On 31 October 2025, Tembo announced a binding definitive agreement with Associated Vehicle Assemblers Ltd. (“AVA”), following the March 2025 heads of agreement. Under the definitive agreement, AVA is to distribute, assemble and service Tembo electric utility vehicles across Kenya, Tanzania and other East African markets.
On 16 January 2026, Tembo announced a strategic partnership with Help Me Buy An EV, an Australian electric vehicle consultancy and advocacy group, for customer trials, education and market engagement for the Tembo Tusker in Australia. The announcement did not report orders, a minimum purchase commitment or deliveries. During the year ended 30 June 2026, Tembo’s activities centered on conversion kits, the Tembo Tusker and electric PUV development, including the Philippines Jeepney program. Electric Vehicles revenue for the year is set out in the table below and in the audited financial statements. As at 30 June 2026, the business combination with CCTS had not been completed and the Energi investment announced in August 2025 had not closed.
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Revenue earned within the Electric Vehicles segment is comprised of the following activities:
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Vehicle spec conversion | 46 | 3 | - | |||||||||
| Conversion kits | 48 | 50 | 16 | |||||||||
| Total revenues | 94 | 53 | 16 | |||||||||
Management expects Electric Vehicles revenue and costs to increase if the EUV conversion kits segment scales and if sales of the Tembo Tusker and electric Jeepneys develop under existing partnerships, but no assurance can be given that this will occur. Tembo operates a capital-light model that uses a supply chain network in Asia and does not require investment in assembly or manufacturing facilities.
Critical Power Services
The Critical Power Services segment, previously conducted through Aevitas Group Limited (“Aevitas”) and its subsidiaries, was discontinued following the sale of Kenshaw Electrical to ARA Group Limited, which completed on 2 July 2024. The results of that segment are presented as discontinued operations. The final gain on disposal, recognized in the year ended June 30, 2025, was $1.7 million, comprising an initial gain of $0.8 million based on disposal consideration of $0.8 million and net liabilities disposed of $0.04 million, together with a $0.8 million adjustment to the estimated costs to sell.
Aevitas was a key player in the manufacture, distribution, installation and servicing of critical energy infrastructure solutions in Australia. Its portfolio spans the design, procurement, installation, and upkeep of power and control systems, including those catering to utility and industrial-scale solar farms. Under Aevitas, there were three operating companies, J.A. Martin Electrical, NDT Services and Kenshaw Electrical. J.A. Martin and NDT Services were sold in July 2022 and Kenshaw Electrical was sold in July 2024. VivoPower is completing a restructure of Aevitas given it is now a discontinued operation.
Sustainable Energy Solutions
VivoPower’s Sustainable Energy Solutions (“SES”) segment designs, evaluates, sells, and implements renewable energy infrastructure. This segment complements our electric vehicle offerings, enabling clients to adopt comprehensive decarbonization measures through on-site renewable generation, batteries and microgrids, EV charging stations, emergency backup power solutions and digital twin technology.
The SES strategy is intended to help corporate customers achieve their decarbonization goals and comprises the following elements:
| ● | Critical power “electric-retrofit” of customer’s sites to enable optimized EV battery charging, encompassing charging stations, renewables, battery storage and microgrids; | |
| ● | Digital twin technology; | |
| ● | EV and battery leasing; | |
| ● | EV battery reuse and recycling; and | |
| ● | Change management and training services |
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Since establishing its Sustainable Energy Solutions (SES) business in FY2021, VivoPower has pursued strategic partnerships and investments across battery energy storage, fleet charging infrastructure and digital twin technologies. These included a memorandum of understanding with Relectrify in December 2021, an investment in Green Gravity Energy in August 2022, a fleet charging distribution agreement with Vital EV Solutions in May 2023, and a joint venture agreement with Geminum in October 2023.
Solar Development
VivoPower holds its portfolio of U.S. solar projects through its wholly owned subsidiary, Caret Global LLC (formerly Caret LLC), which in turn wholly owns Caret Digital, LLC (formerly Caret Decimal LLC) (“Caret”).
The Solar Development segment historically covered the Company’s solar development activities in the U.S. and Australia. The Company has had no solar development activities in Australia since the sale of its interests in solar farm projects in FY21.
The Company’s historic solar development strategy was to minimize capital intensity by developing projects through the early, mid and advanced stages, selling “shovel-ready” projects to investors who finance construction and own and operate the project, and recycling the capital released.
In July 2021, VivoPower announced the formation of Caret.
In October 2023, VivoPower announced that its board approved a plan to spin off the majority of its Caret business unit’s portfolio, initially comprising up to ten solar projects totaling 586 MW-DC. This plan excluded two projects that were committed to a potential collaboration under a term sheet. VivoPower shareholders had approved this spin-off during the November 2022 Annual General Meeting (AGM), marking a pivotal step in realigning the company’s renewable energy strategy.
In November 2024, VivoPower’s Caret announced plans to develop up to 55MW of its solar farm portfolio for digital asset mining, including Dogecoin and Litecoin.
In December 2024, VivoPower’s Caret announced the activation of its Dogecoin mining operations as part of its broader digital asset strategy. The mining operations will use renewable energy sources and support Caret’s goal of generating additional free cash flow and diversifying revenue streams. This marks the company’s entry into active crypto mining with a focus on sustainable practices.
In December 2024, VivoPower’s Caret secured an asset-backed financing facility to acquire up to 1,000 Antminer L9 mining rigs. This move is aimed at accelerating Dogecoin mining revenues and enhancing free cash flow generation. The facility will allow Caret to scale its crypto-mining operations while optimizing capital efficiency.
In January 2025, VivoPower’s Caret secured a CAD$140 million binding investment commitment from GEM Global Yield (GGY). The investment is structured as a share subscription facility, providing Caret with capital flexibility to support its business expansion, including upcoming acquisitions and product development in the digital solutions space.
In March 2025, VivoPower announced its intent to spin off Caret via a direct listing on Nasdaq, accompanied by a dividend share distribution to existing VivoPower shareholders. The spin-off is designed to unlock value and provide direct exposure to Caret’s growing digital asset and AI-focused businesses. The dividend distribution will be made to all eligible VIVO shareholders as of a future record date, which will be announced closer to the listing.
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On December 23, 2025 the Company announced a review of a legacy United States solar development portfolio described as up to 682 MW, previously mothballed, for potential divestment and reinvestment in sovereign AI infrastructure. The announcement stated that there may be behind-the-meter uses but that there was no guarantee value could be monetized.
In May 2025, we launched a digital asset and decentralized finance strategy focused on XRP. Between August and December 2025, we announced proposed and agreed arrangements under that strategy, including a proposal to acquire an initial US$100 million of Ripple Labs shares, a custody arrangement with Crypto.com, a yield-program partnership with Doppler Finance, a heads of agreement with KWeather Co., Ltd (“KWeather”) and a joint venture agreement with Lean Ventures stated at US$300 million. In January 2026, we acquired 41,810 Ripple Labs shares for approximately US$5.0 million.
We have discontinued this strategy. On February 5, 2026, we announced agreements with KWeather and Lean Ventures to sell the economic rights to the Ripple Labs shares. We also announced that we would not acquire any further digital assets and that we would focus our capital and resources on our data center infrastructure business. In April 2026, we sold 882 of the shares to Ripple Labs in a share buyback for US$264,600. As at June 30, 2026, we held 40,928 Ripple Labs shares, carried at a fair value of US$4.3 million, and the agreed sales of the economic rights to KWeather and Lean Ventures had not been completed. We also hold a 16.67% interest in KWeather, a company listed on the KOSDAQ market, carried at a fair value of US$3.0 million at June 30, 2026. Digital asset mining at Caret is separate from the hosting services at the Mo i Rana data center described below.
In March 2025, we announced our intention to spin off Caret, our legacy U.S. solar development and digital asset mining business, through a direct listing on Nasdaq. On 6 July 2026, we announced that the special dividend arrangements previously proposed were discontinued and that the Board intends instead to distribute the entire issued share capital of Caret held by the Group to our shareholders pro rata, in specie. The separation remains subject to final Board approval, regulatory, stock exchange and any required shareholder approvals, definitive documentation and market conditions, and we cannot assure you of its structure, timing or completion.
Revenue earned within Caret is comprised of the Digital Assets segment:
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Digital revenue | - | 8 | - | |||||||||
Data Centers
Mo i Rana, Norway. On 12 May 2026, we completed the acquisition of the entire issued share capital of VivoPower Norge Infrastructure AS (formerly Cromwell AS), which owns Arctic Norge Data I AS (formerly Nordland Data AS), the operator of the Mo i Rana data center. Total consideration was US$37.7 million. The facility has 41.5 MW of energized capacity powered by hydroelectric energy. It currently earns revenue from hosting a customer’s digital asset mining equipment and a 30% share of the compute power under an agreement with Corner Norway AS dated 21 May 2024, which we expect to expire in or around July 2027 with no option to renew. A further 40 MW of expansion capacity is subject to regulatory approval.
We intend to convert the facility to AI data center capacity. In May 2026, we announced a shortlist of prospective tenants. On 29 June 2026, we announced a preferred tenant. We are no longer pursuing a lease with that tenant and are finalizing terms with another prospective tenant. No definitive lease has been signed, and we cannot assure you that one will be concluded. On 12 October 2026, we announced the mobilization of construction for a 40 MW first-phase conversion. We cannot assure you that the conversion will be completed on the anticipated timeline, within budget, or at all.
On 27 April 2026, we announced that 30 MW of the facility had been prequalified for Statnett SF’s balancing markets: 12 MW for frequency containment reserve for disturbances (FCR-D) and 18 MW for manual frequency restoration reserve capacity (mFRR).
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On 22 January 2026, we announced a definitive agreement to acquire OGDC Pte Ltd, an AI data center infrastructure developer with an economic interest in powered land in Finland and other EU countries, including a 291 MW portfolio of land in Finland. The acquisition has not completed.
On 20 January 2026, we announced an agreement to acquire, develop, build, operate and own an initial 25 MW data center facility in the United Arab Emirates, with access to dedicated power and development rights for further scaling.
On 17 August 2026, our Board approved the establishment of a separate AI infrastructure company, to be headquartered in Singapore, to hold our non-Nordic portfolio and pipeline, located primarily in the United Arab Emirates, Oman, Saudi Arabia, Malaysia and the Philippines. We intend to pursue a pre-IPO institutional and sovereign funding round and listings on the London Stock Exchange and the Abu Dhabi Securities Exchange, and to retain de facto control. The Mo i Rana facility remains outside this platform.
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Cryptocurrency mining revenue | 1,016 | - | - | |||||||||
| Digital assets hosting revenue | 1,435 | - | - | |||||||||
| 2,451 | - | - | ||||||||||
Dependence on Key Contracts and Customers
Our business currently depends on a limited number of material contracts and customers. In particular, substantially all of the revenue of our Data Center segment is derived from our agreement with a single digital asset mining customer, Corner Norway AS, at the Mo i Rana Data Center. Under that agreement we earn hosting fees (US$1,4 million, or 59% of Data Center segment revenue of US$2,5 million in FY26) and also receive 30% of the compute power provided by the customer’s equipment, or of the bitcoin mined, through a mining pool, which we report as digital asset mining revenue. That agreement was entered into on May 21, 2024, runs for 36 months from the date on which the customer’s equipment was fully deployed and contains no right of renewal, so it is expected to expire in 2027 unless extended or replaced. The agreement may be terminated before expiry only in limited circumstances, including material breach, insolvency and prolonged force majeure.
The operation of the facility also depends on its grid connection and power supply arrangements and on the long-term lease of the land on which it is located. The future conversion of the facility to AI compute depends on our entering into one or more long-term leases with AI compute tenants, and we have not yet entered into any such lease. The termination, expiry, non-renewal or adverse amendment of any of these contracts, or the failure of a counterparty to perform, could have a material adverse effect on our business, financial condition and results of operations. See Item 3.D “Risk Factors”.
The contracts on which we are substantially dependent are filed as exhibits to this Annual Report (see Item 19), with certain information that is both not material and of the type that we treat as private or confidential redacted for reasons of commercial sensitivity, as permitted by Instruction 4 to Item 19 of Form 20-F.
Regulation
Our operations are subject to a wide range of laws and regulations in the jurisdictions in which we operate. The following is a summary of the principal regulatory regimes that are material to our business. It is not exhaustive, and the laws described are subject to change.
Norway - data center operations
Under section 3-7 of the Norwegian Electronic Communications Act (ekomloven) and the Regulation on data centers (the “Data Center Regulation”), both of which came into force on January 1, 2025, operators of data center services must register with the Norwegian Communications Authority (Nkom), the supervisory authority, before commencing operations. Operators already in operation had until July 1, 2025 to register. Registered operators must provide and maintain data center services with adequate security and preparedness, must notify Nkom without undue delay of incidents that cause significant breaches, and, under amendments that took effect on July 1, 2026, must keep up-to-date information on their customers and have a representative in Norway. Nkom may issue orders to correct non-compliance and may impose coercive fines and administrative fines.
On March 12, 2026, the Storting adopted a resolution asking the Government to return with a proposal for a ban on the establishment of data centers for cryptocurrency mining. The Storting did not adopt a proposal for a national licensing regime for data centers. The Government has stated that it is investigating a central government planning provision under the Planning and Building Act (plan- og bygningsloven) that would impose a temporary and limited prohibition on the establishment of new, energy-intensive crypto-mining data centers, and that, based on EEA law assessments, it is difficult at present to see a basis for a general ban on cryptocurrency mining. No such ban is currently in force. The scope and timing of any measures, and their application to existing facilities and hosting arrangements such as ours, remain uncertain.
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The development and expansion of data centers in Norway is subject to municipal zoning and building permits under the Planning and Building Act. Connection to the electricity grid and the allocation of grid capacity are subject to the requirements of the Norwegian Water Resources and Energy Directorate (NVE), the transmission system operator Statnett SF and the relevant regional grid operator, and additional capacity, including the further 40 MW at Mo i Rana, is subject to approval and the availability of capacity. Participation in reserve markets is subject to prequalification by Statnett. Electricity consumed by data centers is subject to the Norwegian electricity tax (elavgift), and changes to the rate or to the treatment of data centers could increase our power costs.
As a member of the European Economic Area, Norway is expected to implement the EU Energy Efficiency Directive (Directive (EU) 2023/1791) and the related Commission Delegated Regulation (EU) 2024/1364, which require operators of data centers above a power threshold to report energy performance and sustainability information annually. The timing of implementation in Norway and its application to the Mo i Rana Data Center are uncertain.
United Kingdom
As a public limited company incorporated in England and Wales, we are subject to the Companies Act 2006, including requirements relating to the allotment of shares, pre-emption rights, distributions, shareholder meetings and the duties of directors. We are also subject to UK tax, anti-bribery (Bribery Act 2010), anti-money laundering and data protection laws (UK GDPR and the Data Protection Act 2018).
United States
As a foreign private issuer with Class A Ordinary Shares listed on Nasdaq, we are subject to the Securities Act of 1933, the Exchange Act, the Sarbanes-Oxley Act of 2002 and the Nasdaq Listing Rules. Our Tembo business and our legacy solar development portfolio are subject to U.S. federal and state laws, including product safety, environmental and energy regulation.
Philippines and other markets
Tembo’s operations, including in the United Arab Emirates, Philippines, Australia and the Netherlands, are subject to local vehicle homologation and type-approval, product safety, import and customs, employment and environmental laws, and to the regulation of electric vehicles and charging infrastructure. Our pipeline projects in other jurisdictions, are subject to local foreign investment, planning, energy and data center regulation.
Sanctions, anti-money laundering and export controls
We are subject to the economic sanctions laws of the United Kingdom, the European Union and Norway, and of the United States (including those administered by the Office of Foreign Assets Control), and to anti-money laundering and counter-terrorist financing laws, which are relevant in particular to our hosting of digital asset mining operations and our legacy digital asset activities. The procurement, export and use of advanced computing hardware, including graphics processing units used for AI compute, are subject to U.S. export controls administered by the Bureau of Industry and Security under the Export Administration Regulations, and to equivalent UK, EU and Norwegian controls. These controls may restrict the supply of hardware to our facilities, the identity and location of our tenants and their customers, and the end uses of our capacity.
JOBS Act
In previous reporting periods, the Company met the requirements under the JOBS Act as an “emerging growth company” to not (i) provide an auditor’s attestation report on its system of internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act (“SOX”), (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis), or (iv) disclose certain executive compensation-related items such as the correlation between executive compensation and performance and comparisons of our chief executive officer’s compensation to median employee compensation. Although the Company no longer qualifies as an “emerging growth company,” it still qualifies as a non-accelerated filer and, therefore, is exempt from the requirement to provide an auditor’s attestation report on its system of internal controls over financial reporting pursuant to Section 404(b) of SOX.
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C. Organizational Structure
VivoPower has 26 subsidiaries (collectively with VivoPower, “the Group”). The following list shows the Company’s shareholdings in subsidiaries owned directly and indirectly as at June 30, 2026.
| No. | Subsidiaries | Incorporated | % Owned | Purpose | ||||
| 1 | VivoPower International Services Limited | Jersey | 100% | Operating company | ||||
| 2 | VivoPower USA, LLC | United States | 100% | Holding company | ||||
| 3 | VivoPower US-NC-31, LLC | United States | 100% | Dormant | ||||
| 4 | VivoPower US-NC-47, LLC | United States | 100% | Dormant | ||||
| 5 | VivoPower (USA) Development, LLC | United States | 100% | Holding company | ||||
| 6 | Caret Global, LLC (formerly Caret, LLC) | United States | 100% | Operating company | ||||
| 7 | Caret Digital, LLC (formerly Caret Decimal, LLC) | United States | 100% | Operating company | ||||
| 8 | VIWR AU Pty Ltd (formerly VIVOPOWER PTY LTD) | Australia | 100% | Holding company | ||||
| 9 | Aevitas O Holdings Pty Ltd | Australia | 100% | Holding company | ||||
| 10 | Aevitas Group Limited | Australia | 100% | Holding company | ||||
| 11 | Aevitas Holdings Pty Ltd | Australia | 100% | Holding company | ||||
| 12 | KESW SO Pty Ltd (formerly Kenshaw Solar Pty Ltd and J.A. Martin Electrical Pty Ltd) | Australia | 100% | Operating company | ||||
| 13 | Tembo Technologies Pty Ltd (formerly Tembo EV Australia Pty Ltd) | Australia | 100% | Operating company | ||||
| 14 | Tembo EV Pty Ltd | Australia | 100% | Operating company | ||||
| 15 | TemboDrive Pty Ltd | Australia | 100% | Operating company | ||||
| 16 | VivoPower Philippines Inc. | Philippines | 64% | Dormant | ||||
| 17 | VivoPower RE Solutions Inc. | Philippines | 64% | Dormant | ||||
| 18 | V.V.P. Holdings Inc* | Philippines | 40% | Dormant | ||||
| 19 | Tembo e-LV B.V. | Netherlands | 100% | Holding company | ||||
| 20 | Tembo 4x4 e-LV B.V. | Netherlands | 100% | Operating company | ||||
| 21 | FD 4x4 Center B.V. | Netherlands | 100% | Operating company | ||||
| 22 | Tembo Group B.V. (formerly Tembo EUV Solutions B.V) | Netherlands | 100% | Holding company | ||||
| 23 | Tembo EUV Solutions FZCO | United Arab Emirates | 100% | Holding company | ||||
| 24 | Tembo EUV Investment Corporation Ltd | Cayman Islands | 100% | Holding company | ||||
| 25 | Cromwell AS (now known as Vivo Power Norge Infrastructure AS) | Norway | 100% | Holding company | ||||
| 26 | Nordland Data AS (now known as Arctic Norge Data I AS) | Norway | 100% | Operating company |
Notwithstanding a 40% ownership by the Company, V.V.P. Holdings Inc is under the control of VivoPower Pty Ltd, and therefore is consolidated into the group financial statements of VivoPower PLC.
During the year, the following subsidiaries were deregistered:
Electrical Engineering Group Pty Ltd (Australia) - Deregistered on 16 December 2025.
KESW EL Pty Ltd (formerly Kenshaw Electrical Pty Ltd) (Australia) – Deregistered on 31 May 2026.
D. Property, Plant and Equipment
Our corporate headquarters is located in London, United Kingdom. We do not own any real property. Our Mo i Rana, Norway data center is located on land leased by our subsidiary Arctic Norge Data I AS (formerly Nordland Data AS) from Mo Industripark AS under two leases covering approximately 50,500 square meters. The main lease (approximately 42,000 square meters) runs to 29 February 2076, and the second (approximately 8,500 square meters) runs to 31 December 2037. Combined annual base rent is approximately NOK 6.3 million, subject to annual CPI indexation. We believe that our facilities are adequate for our current needs and that suitable additional or substitute space will be available as needed to accommodate planned expansion of our operations. Leased real property as at June 30, 2026 is as follows:
| Company | Office/Premises Location | Purpose | ||
| Tembo BV | Eindhoven, Netherlands | EV Operations | ||
| VivoPower PLC | London, United Kingdom | Corporate office | ||
|
Nordland Data AS (now known as Arctic Norge Data I AS) |
Mo i Rana, Norway |
Data Center Operations |
* vacated in July 2024 with relocation to new premises
The Company has invested $16.45 million in property, plant, and equipment at June 30, 2026 (June 30, 2025: $0.6 million; June 30, 2024 $0.4 million). This includes plant and equipment of $2.5 million (June 30, 2025: $0.1 million; June 30, 2024: $0.1 million), motor vehicles of $0.9 million (June 30, 2025: $0.3 million; June 30, 2024: $0.3 million), computer equipment, fittings and equipment of $2.9 million (June 30, 2025: $0.04 million; June 30, 2024: $0.01 million), and right-of-use assets of $10.1 million (June 30, 2025: $0.2 million; June 30, 2024: nil), representing leases for property and motor vehicles.
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ITEM 4A. UNRESOLVED STAFF COMMENTS
None.
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS
The following discussion and analysis of our financial condition and results of operations covers the twelve months ended June 30, 2026 (“FY2026”) and should be read in conjunction with our audited consolidated financial statements and the related notes included elsewhere in this Annual Report. Comparative information for the year ended June 30, 2025 (“FY2025”) has been restated, as described in Note 35 to the consolidated financial statements. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set out under “Cautionary Statement Regarding Forward-Looking Statements” and Item 3.D “Risk Factors”. In accordance with Instruction 1 to Item 5 of Form 20-F, a discussion of our results for the year ended June 30, 2024, compared with the year ended June 30, 2025 has been omitted. That discussion can be found in Item 5 of our Annual Report on Form 20-F for the year ended June 30, 2025, filed with the SEC on October 30, 2025.
Overview
VivoPower has, since its inception, been a power-focused company. Our strategy is built around what we describe as “Power-to-X”: securing access to low-cost, sustainable and ideally renewable power, and converting that power into its highest-value use for the benefit of our shareholders as well as the countries and communities that we operate in. Over our history, that use has taken different forms, including the development and sale of solar projects, the provision of critical power services, the electrification of utility vehicles through our Tembo business and, most recently, digital infrastructure.
During FY2026, it became clear to management and the Board that the highest and best use of power available to us would be AI compute. Based on our analysis, we believe that AI compute offers the potential for higher revenue and margin per megawatt than digital asset mining and hosting, the uses to which such power has more commonly been applied. We therefore began evaluating opportunities in the digital infrastructure sector in July 2025 and decided to focus on a powered land strategy. Following that process, on December 30, 2025 we entered into an exclusive heads of agreement to acquire an energized data center business in Mo i Rana, Norway (the “Mo i Rana Facility”), and on January 6, 2026 we entered into a share purchase agreement to acquire 100% of the shares of Cromwell AS (now VivoPower Norge Infrastructure AS) and its wholly owned subsidiary Nordland Data AS (now Arctic Norge Data I AS) from Lian Group (the “Mo i Rana Acquisition”). The Mo i Rana Acquisition, for a consideration of US$37.7 million, was completed on May 12, 2026.
The Mo i Rana Data Center is an operational, 41.5 MW energized facility in the Mo i Rana industrial precinct in northern Norway. It is supplied with 100% renewable hydroelectric power at an approximate cost of US$0.045 per kWh, and a further 40 MW of expansion capacity which is subject to regulatory approval. Following completion, we launched a competitive process to select one or more AI compute tenants and announced a shortlist on May 21, 2026. We are no longer pursuing a lease with the tenant we announced as preferred on June 29, 2026, and are now finalizing terms with another prospective tenant. We have not entered into a definitive lease with any AI compute tenant, and there can be no assurance that we will do so on acceptable terms, or at all. The facility continues to generate revenue from existing hosting arrangements with a digital asset mining customer. We remain committed to our powered land strategy.
During the fiscal year, we brought our digital asset treasury strategy, adopted in May 2025 and focused on XRP, to a close. In January 2026, we acquired 41,810 shares in Ripple Labs, an unlisted company, for approximately US$5.0 million. In February 2026, we agreed with two South Korean counterparties, KWeather Co., Ltd (“KWeather”) and Lean Ventures, to sell the economic rights to those shares, and we announced that we would not acquire further digital assets. In April 2026, we sold 882 of the shares to Ripple Labs in a share buy back for US$264,600, realizing a gain of US$159,122. As at 30 June 2026, we held 40,928 Ripple Labs shares, carried at a fair value of US$4.3 million, and the agreed sales to KWeather and Lean Ventures had not been completed. We also hold a 16.67% interest in KWeather, a company listed on the KOSDAQ market, carried at a fair value of US$3.0 million at 30 June 2026. The shares are held through the Korea Securities Depository and are subject to a one-year lock-up from the listing date. Both holdings are measured at fair value through profit or loss (see Note 16 to our consolidated financial statements).
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The onset of war in the Middle East and the consequential increase in fossil fuel prices including gas and diesel have catalyzed a significant escalation in interest and demand for electric vehicles. Tembo has experienced this as well, with a marked increase in inbound inquiries and purchase orders for delivery of its electric vehicle products, especially in relation to the e-jeepneys in the Philippines. Revenue increased by 77% in FY26 albeit off a low base and should the purchase orders translate into increased revenues and combined with continued discipline on cost management, Tembo may achieve breakeven or profitability in FY2027. With regards to the proposed business combination with CCTS and uplisting to a listed market, there have been unexpected delays which were also as a result of the war in the Middle East, with CCTS’s auditors being located in Israel and unable to complete the audit for CCTS on a timely basis. In addition, there have been new regulations introduced that govern uplistings which Tembo and CCTS are working through. All parties remain committed to consummating the business combination and uplisting on to a listed exchange, especially given the strong tailwinds that underpin the electric vehicle sector at present. There can however be no guarantees on timing given the unexpected roadblocks that may appear as has happened over the last 12 months.
Following these steps, our concerted strategic and execution focus is on our digital infrastructure business. On July 2, 2026, our Board resolved that the development and scale-up of our AI data center business is the principal strategic priority of the Group, and that our Tembo electric vehicle business and our Caret business are non-core businesses to be separated in a manner consistent with that priority.
A. Operating Results
The table below summarizes our consolidated results for FY2026 and FY2025 (restated). The figures are those reported in our audited consolidated financial statements.
| (US$ thousands) | FY2026 (continuing) | FY2025 continuing (restated) | FY2025 including discontinued (restated) | |||||||||
| Revenue from contracts with customers | 2,545 | 61 | 61 | |||||||||
| Other gains/(losses) | 1,272 | 16 | 16 | |||||||||
| Other income | 218 | – | 1,648 | |||||||||
| Cost of sales | (1,934 | ) | (50 | ) | (50 | ) | ||||||
| Gross profit and other income | 2,101 | 27 | 1,675 | |||||||||
| General and administrative expenses – cash-settled | (13,414 | ) | (9,199 | ) | (9,199 | ) | ||||||
| General and administrative expenses – share-based payments (non-cash) | (13,099 | ) | (1,900 | ) | (1,900 | ) | ||||||
| Depreciation and amortization | (928 | ) | (517 | ) | (517 | ) | ||||||
| Operating loss | (25,340 | ) | (11,589 | ) | (9,941 | ) | ||||||
| Restructuring and other non-recurring costs | (1,451 | ) | (412 | ) | (412 | ) | ||||||
| Impairment losses | (616 | ) | (2,531 | ) | (2,531 | ) | ||||||
| Finance income | 456 | 3,568 | 3,568 | |||||||||
| Finance expense | (7,031 | ) | (7,033 | ) | (7,033 | ) | ||||||
| Fair value loss on warrant and derivative liabilities | (14,753 | ) | – | – | ||||||||
| Loss before income tax | (48,735 | ) | (17,997 | ) | (16,349 | ) | ||||||
| Income tax | (1,618 | ) | 691 | 691 | ||||||||
| Loss for the year | (50,353 | ) | (17,306 | ) | (15,658 | ) | ||||||
| Adjusted EBITDA (non-IFRS) | (24,412 | ) | (11,080 | ) | (9,432 | ) | ||||||
| Adjusted EBITDA before non-cash share-based payments (non-IFRS) | (11,313 | ) | (9,180 | ) | (7, | ) | ||||||
FY2026 compared with FY2025
Revenue
Revenue increased to US$2.545 million in FY2026 from US$0.061 million in FY2025, reflecting the consolidation of the Mo i Rana Data Center from May 12, 2026. Revenue in the Data Center segment was US$2.451 million. Revenue in the Electric Vehicles segment was US$0.094 million (FY2025: US$0.053 million), reflecting conversion kit and vehicle sales by Tembo. The FY2026 data center revenue reflects only the period from completion of the Mo i Rana Acquisition in May 2026 to June 30, 2026, and is not indicative of full-year results.
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Gross profit and other income
Gross profit and other income was US$2.101 million in FY2026 (FY2025: US$1.675 million). Gross profit, being revenue less cost of sales, increased to US$0.611 million from US$0.011 million, with gross margin increasing to 24.0% (FY2025: 18.0%). This growth was driven by the Data Center segment, which generated gross profit of US$0.576 million. Cost of sales mainly comprised power and site operating costs at the Mo i Rana Data Center. Net other gains were US$1.27 million (FY2025: US$0.016 million), comprising US$1.27 million from liabilities written back during the year. Other income was US$0.218 million (FY2025: US$1.648 million).
General and administrative expenses
General and administrative expenses increased by US$15.41 million to US$26.51 million in FY2026 from US$11.10 million (restated) in FY2025. Of this amount, US$13.41 million (FY2025: US$9.199 million) was cash-settled and US$13.10 million (FY2025: US$1.90 million) comprised non-cash share-based payments, principally professional fees to advisors settled in shares in connection with our capital formation and transaction activity in connection with the exit from the digital asset treasury strategy and the focus on the AI digital infrastructure strategy. These fees were not capitalized notwithstanding they were in connection with balance sheet activities.
The main components were:
| (US$ thousands) | FY2026 | FY2025 (restated) | Change | |||||||||
| Professional fees | 18,917 | 5,372 | 13,545 | |||||||||
| Salaries and employee benefits | 5,534 | 3,706 | 1,828 | |||||||||
| IT and software | 761 | 387 | 374 | |||||||||
| Marketing | 563 | 858 | (295 | ) | ||||||||
| Insurance | 316 | 320 | (4 | ) | ||||||||
| Travel | 227 | 129 | 98 | |||||||||
| Office and other | 195 | 327 | (132 | ) | ||||||||
| Total | 26,513 | 11,099 | 15,414 | |||||||||
The increase in professional fees primarily reflected legal, advisory, audit and capital formation costs associated with the Mo i Rana Acquisition, our equity financings and the proposed Tembo business combination. Approximately US$1.8 million of direct costs related to the Tembo business.
Professional fees of US$18.917 million are analyzed below by type and by whether they were paid in cash or settled in shares and other equity instruments. Of the total, US$12.929 million (68%) was non-cash and non-recurring.
| (US$ thousands) | Total | Cash | Non-cash | |||||||||
| Audit and accounting | 1,274 | 1,274 | – | |||||||||
| Legal | 1,490 | 1,490 | – | |||||||||
| Contractor fees | 1,454 | 1,454 | – | |||||||||
| Investor relations | 897 | 637 | 260 | |||||||||
| Public company costs | 538 | 538 | – | |||||||||
| General | 452 | 445 | 7 | |||||||||
| Capital formation and transaction-related | 12,812 | 150 | 12,662 | |||||||||
| Total professional fees | 18,917 | 5,988 | 12,929 | |||||||||
Audit and accounting fees increased materially in FY2026, to US$1.376 million (FY2025: US$0.14 million).
Other items
For the year ended June 30, 2026, corporate restructuring costs included legal and other fees of US$0.7 million (2025: US$0.2 million) and a general litigation provision of US$0.5million (2025: US$0.5 million). Fiscal provisions amounted to US$0.8 million (2025: US$0.2 million). These costs included a gain of US$0.6 million (2025: gain of US$0.5 million) on the effectuation of deeds of company arrangement (“DOCAs”). It relates to Aevitas Group Limited (effectuated November 12, 2025) and KESW EL Pty Ltd, formerly Kenshaw Electrical Pty Ltd (effectuated December 23, 2025). The FY2025 gain related to VIWR AU Pty Ltd. A further DOCA for KESW SO Pty Ltd, formerly Kenshaw Solar Pty Ltd, was effectuated on July 1, 2026.
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Finance income decreased to US$0.46 million from US$3.56 million. Finance expense was US$7.03 million (FY2025: US$7.03 million), mainly reflecting interest on the AWN loan facilities of US$4.02 million, foreign exchange losses and interest on preference shares and lease liabilities. We also recognized a fair value loss of US$14.75 million (FY2025: nil) on the remeasurement of warrant and derivative liabilities and other instruments, which is presented as a separate line with finance expense. Net finance costs from continuing operations, including that loss, were therefore US$21.8 million (FY2025: US$3.465 million). We recorded an income tax expense of US$1.62 million (FY2025: credit of US$0.69 million).
As a result of the foregoing, the loss from continuing operations was US$50.35 million (FY2025: US$17.3 million, restated), and the total loss for the year, including a profit of US$0.621 million from discontinued operations, was US$49.73 million (FY2025: US$15.66 million, restated).
Segment results
Management analyzes our business in the following reportable segments: Data Center, Electric Vehicles, Critical Power Services, Solar Development, Sustainable Energy Solutions and Corporate Office. The Data Center segment was formerly presented as Digital Assets.
| FY2026 (US$ thousands) | Data Center | Electric Vehicles | Corporate Office | Other Segments | Total Continuing | |||||||||||||||
| Revenue | 2,451 | 94 | – | – | 2,545 | |||||||||||||||
| Gross profit | 576 | 35 | – | – | 611 | |||||||||||||||
| General and administrative expenses | (513 | ) | (2,835 | ) | (22,813 | ) | (352 | ) | (26,513 | ) | ||||||||||
| Operating profit/(loss) | 41 | (3,013 | ) | (26,326 | ) | 3,958 | (25,340 | ) | ||||||||||||
Data Center. The Data Center segment generated an operating profit of US$0.04 million in its first period of consolidation. Results reflect the existing hosting configuration and are not indicative of results following any conversion to AI compute.
Electric Vehicles. The Electric Vehicles segment, comprising Tembo, generated an operating loss of US$3.01 million, reflecting continued investment in product, homologation and go-to-market programs.
Critical Power Services and other segments. Other segments recorded an operating profit of US$3.96 million, mainly due to other gains of US$3.782 million in the Critical Power Services segment. The Corporate Office segment recorded other losses of US$4.244 million, including fair value losses of US$1.869 million on equity investments.
Non-IFRS financial measure: Adjusted EBITDA
We define Adjusted EBITDA as loss for the year before income tax, net finance costs, depreciation and amortization, impairment losses, and restructuring and other non-recurring costs. It is not an IFRS measure and should not be considered an alternative to loss for the year; management uses it to assess underlying operating performance. We also present Adjusted EBITDA before non-cash share-based payments, which further excludes general and administrative expenses settled in shares or other equity instruments, being professional fees settled in shares and equity incentive awards to employees. These costs are recurring and should be considered together with loss for the year; management uses the measure to assess operating performance before costs that do not require the use of cash.
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| (US$ thousands) | FY2026 continuing | FY2025 continuing (restated) | ||||||
| Loss for the year | (50,353 | ) | (17,306 | ) | ||||
| Income tax | 1,618 | (691 | ) | |||||
| Net finance costs | 21,328 | 3,465 | ||||||
| Depreciation and amortization | 928 | 517 | ||||||
| Impairment losses | 616 | 2,531 | ||||||
| Restructuring and other non-recurring costs | 1,451 | 412 | ||||||
| Other adjustments | - | (8 | ) | |||||
| Adjusted EBITDA | (24,412 | ) | (11,080 | ) | ||||
| Non-cash share-based payments | 13,099 | 1,900 | ||||||
| Adjusted EBITDA before non-cash share-based payments | (11,313 | ) | (9,180 | ) | ||||
B. Liquidity and Capital Resources
Overview
Our principal sources of liquidity have been proceeds from issuances of equity securities and borrowings. Our principal uses of cash have been funding the Mo i Rana Acquisition, capital expenditure, operating losses, investments and debt service.
At June 30, 2026, we had cash and cash equivalents of US$2.02 million. Current assets were US$77.47 million (June 30, 2025: US$72.14 million), including trade and other receivables of US$74.4 million, of which US$53.3 million represented subscription amounts receivable in respect of our Regulation S placement. Under the Regulation S subscription arrangement, we secured subscription commitments of US$121.0 million at US$6.05 per share, in two tranches of US$60.5 million. We booked US$60.5 million in our books as a receivable in respect of this arrangement. Of this amount, approximately US$8.18 million had been received as of July 23, 2026, and 1 million shares have been issued while the remaining shares had yet to be issued. We secured commitment letters in relation to the monies outstanding, which have been held up due to war in the Middle East which have affected both the United Arab Emirates and Saudi Arabia with regards to their banking architecture and international wire transfers. The subscription receivable is recognized as a financial asset and is subject to the expected credit loss requirements of IFRS 9 (see Note 31 to our consolidated financial statements). Current liabilities were US$89.42 million (June 30, 2025: US$53.75 million), resulting in net current liabilities of US$11.95 million (June 30, 2025: net current assets of US$18.40 million). Net assets were US$36.93 million (June 30, 2025: US$17.24 million).
Cash flows
Net cash and cash equivalents increased by US$2.0 million in FY2026 (FY2025: decrease of US$0.1 million).
Operating activities. Net cash used in operating activities was US$3.6 million (FY2025: US$7.7 million), reflecting primarily non recurring capital formation and transaction costs, movements in working capital and the loss for the year adjusted for non-cash and non-operating items.
Investing activities. Net cash used in investing activities was US$32.1 million (FY2025: US$1.27 million), comprising US$20.9 million for acquisitions, net of cash acquired, mainly the Mo i Rana Acquisition, US$10.4 million for purchases of other investments and US$0.3 million for investment in capital projects and US$0.5 million relating to property, plant and equipment.
Financing activities. Net cash generated from financing activities was US$37.6 million (FY2025: US$8.8 million), comprising US$25.5 million of proceeds from investors, US$13.0 million of proceeds from capital raises and US$0.1 million transferred from restricted cash, partly offset by US$0.04 million of lease repayments and US$0.9 million of related party loan repayments. After year end, we completed a further PIPE financing in July 2026 and eliminated AWN principal debt of $28.8m, which was partly paid in cash (US$12.3m) and partly converted to convertible preference shares.
Indebtedness
At June 30, 2026, total borrowings were US$39.03 million, comprising loans from AWN Holdings Limited (“AWN”) of US$28.74 million (US$12.88 million current and US$15.86 million non-current) and lease liabilities of US$10.30 million (US$0.74 million current and US$9.56 million non-current). Our Chairman and Chief Executive Officer is also the Chief Executive Officer of AWN, and the AWN facilities are related party transactions (see Item 7.B). After year end, in July and August 2026, US$28.8 million of the principal of the AWN shareholder loan was retired, comprising US$16.5 million exchanged for 165,000 convertible preference shares and US$12.3 million repaid in cash. There is approximately US$16 million of accrued interest remains outstanding, and we are in discussions with AWN regarding settlement options, including a potential conversion into ordinary shares.
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Material cash requirements
Our material cash requirements over the next twelve months and beyond include:
| ● | Deferred consideration for the Mo i Rana Acquisition: US$5.0 million due on November 12, 2026 and US$5.25 million due on May 12, 2027, including a retention amount of US$2.0 million that is available only in respect of claims under the share purchase agreement. These amounts remain subject to final confirmation as a result of VivoPower paying prior undisclosed liabilities that were the responsibility of the vendor and potential further escrow amounts as a result of the tax investigation matter (see Item 8.A “Legal Proceedings”) |
| ● | Mo i Rana conversion capital expenditure: the cost of converting the facility for AI compute, which will depend on the tenant and scope. We intend to phase this expenditure in line with confirmed tenant commitments and available financing, and our going concern assessment does not depend on the capital for the conversion being raised. This financing is expected to be largely project finance debt. |
| ● | Tembo investment commitments: our commitment to subscribe for a convertible note issued by an unrelated Australian company, of up to A$16.0 million (approximately US$11.0 million, translated at the Reserve Bank of Australia rate of A$1.00 = US$0.6869 on June 30, 2026). The note carries a contractual interest rate and is convertible, at our option, into equity of the issuer on or before a fixed sunset date. It is measured at amortized cost, and its carrying amount at June 30, 2026 approximated the principal advanced, net of any impairment allowance is US$1.6 million. |
Going concern
The Directors have assessed the Group’s ability to continue as a going concern for a period of at least twelve months from the reporting date, which in practice has been considered through June 30 2027. The assessment considered solvency, liquidity and the Group’s sources of financing, and included whether any events or conditions cast significant doubt on the Group’s ability to continue as a going concern. The Directors have concluded that no material uncertainty exists and have therefore prepared the financial statements on a going concern basis.
Capital raised and debt retired
Since 30 June 2025, we have received approximately US$59.5 million in cash from capital raisings, comprising US$12.4 million under our Form F-1 offering, US$4.1 million under Regulation S placements, US$25.5 million from the issue of Series 1 convertible preference shares in PIPE 1, and US$17.5 million under PIPE 2. In addition to the above, PIPE 1 also included US$4.2 million of convertible preference shares issued to ASEAN in lieu of Aevitas preference shares, for which we received no cash.
In July 2026, we agreed a US$50.0 million PIPE 2 transaction. As at the date of this report, US$17.5 million had been received in cash and US$16.5 million had been satisfied through the exchange of AWN shareholder loan principal for 165,000 convertible preference shares. The remaining US$16.0 million was outstanding and subject to completion of customary KYC approvals.
In addition, till date we have received US$8.12 million under the HRH Reg S subscription agreement with the balance held up due to international wire transfer restrictions as a consequence of the war in the Middle East.
In July and August 2026, we retired the US$28.8 million principal of the AWN shareholder loan, of which US$16.5 million was exchanged for convertible preference shares and US$12.3 million was repaid in cash. No principal remains outstanding under the AWN facility.
Despite periods of constrained liquidity and challenging capital markets, the Group has continued to access capital, raising approximately US$59.5 million of gross proceeds since 30 June 2025 while also retiring US$28.8 million of shareholder debt principal.
Financial position at 30 June 2026
At 30 June 2026 the Group held cash of US$2.02 million (30 June 2025: US$0.06 million) and reported net current liabilities of US$11.95 million, with current assets of US$77.47 million and current liabilities of US$89.42 million (30 June 2025: net current assets of US$18.40 million). Current assets include trade and other receivables of US$74.40 million, of which US$53.3 million represents subscription amounts receivable under the Regulation S placement. Current liabilities include a warrant derivative liability of US$17.14 million, which relates to cashless warrants and will not result in a cash outflow, and US$10.0 million of shares to be issued, which is also a non-cash liability that will be settled through the issue of shares. Net assets were US$36.93 million (30 June 2025: US$17.24 million).
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Total borrowings were US$39.03 million, comprising loans from AWN Holdings Limited of US$28.74 million (US$12.88 million current and US$15.86 million non-current) and lease liabilities of US$10.29 million (US$0.74 million current and US$9.55 million non-current). In July and August 2026, US$28.8 million of the AWN loan principal was retired, of which US$16.5 million was exchanged for 165,000 convertible preference shares and US$12.3 million was repaid in cash.
Subscription receivables
Under the Regulation S placement, a consortium led by Ceres Holding Limited committed to subscribe for 10.0 million Class A Ordinary Shares at US$6.05 per share, a total of US$60.5 million. At 30 June 2026, US$53.3 million of the US$60.5 million Regulation S subscription remained outstanding as a receivable.
Payment of the balance has been delayed as a result of the conflict in the Middle East, where the consortium is based. The receivable is unsecured and is subject to the expected credit loss requirements of IFRS 9. The Group has considered the collectability and timing of this receivable separately in its liquidity assessment and has not relied solely on the reported working capital position in reaching its going concern conclusion.
Working capital
In our opinion, taking into account the financing completed since June 30, 2026, our working capital is sufficient for our present requirements, being for at least the next twelve months from the reporting date. At June 30, 2026, we had net current liabilities of US$11.95 million, comprising current assets of US$77.47 million and current liabilities of US$89.42 million. Current liabilities included a warrant derivative liability of US$17.14 million, which will not result in a cash outflow, and US$10.0 million of shares to be issued, which is expected to be settled in shares. Adjusting for these, our net current assets would be $15.2m.
Since June 30, 2026, we have received US$17.5 million in cash under the PIPE 2 transaction, exchanged US$16.5 million of AWN shareholder loan principal for convertible preference shares and repaid a further US$12.3 million of that principal in cash. In forming this opinion, we have taken into account our material cash requirements over the next twelve months. We have also taken into account the sources of funds expected to meet them, including the remaining US$16.0 million of PIPE 2 proceeds, which is subject to completion of customary KYC approvals, and the outstanding Regulation S subscription receivable. Our opinion does not depend on signing an AI tenant for the Mo i Rana site, completing Tembo’s proposed business combination with Cactus Acquisition Corp. 1 Limited or raising capital for the Mo i Rana conversion. If expected inflows are delayed, we would reschedule discretionary expenditure, phase the Mo i Rana conversion in line with confirmed tenant commitments and financing, reduce overheads and, if necessary, raise additional equity or debt capital. Furthermore, Mo i Rana continues to be generating revenues, profits and positive cashflow from the digital asset mining hosting activities.
Mitigating actions
If any material cash inflow does not arrive as forecast, the Directors may reschedule operating activity, delay Tembo growth expenditure, phase the Mo i Rana buildout to align with confirmed tenant commitments and financing, match growth expenditure to financing inflows, manage supplier payment timing, reduce overheads, and raise additional equity or debt capital.
Conclusion
Based on this assessment, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for at least twelve months from the reporting date, and that no material uncertainty exists in relation to going concern. The Group’s greatest strength is its proven track record of raising capital, including in difficult market conditions, having raised approximately US$59.5 million of gross proceeds since 30 June 2025. The Directors have therefore continued to adopt the going concern basis in preparing the financial statements.
C. Research and Development, Patents and Licenses, etc.
Our research and development activities during FY2026 related mainly to Tembo’s electric utility vehicle and conversion kit platforms. Our accounting policy for development costs is described in Note 2.4 to our consolidated financial statements.
D. Trend Information
Other than as described below and elsewhere in this Annual Report, we are not aware of any trends, uncertainties, demand, commitments or events since July 1, 2026 that are reasonably likely to have a material effect on our revenue, income from continuing operations, profitability, liquidity or capital resources, or that would cause reported financial information not necessarily to be indicative of future operating results or financial condition.
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Demand for AI compute digital infrastructure
We believe that demand for power-dense, low-cost and renewable data center capacity for AI compute in the Nordic region remains strong, and since completing the Mo i Rana Acquisition we have continuously received inbound interest from AI neocloud operators and hyperscalers. Our FY2027 results will depend significantly on whether and when we sign a lease, the conversion capital expenditure required and how that is funded, and the treatment of existing hosting contracts during the transition. Pending conversion, revenue from existing hosting arrangements will remain exposed to digital asset prices and Norwegian regulatory developments. Our economics also depend on Nordic power prices, grid tariffs and electricity taxes, and on approval of the additional 40 MW of capacity.
Middle East conflict and international payments
The escalation of the war in the Middle East following the outbreak of hostilities involving Iran on February 28, 2026 has created a difficult operating environment given we have operations and investors in the region. Among other things, it has adversely affected the speed and reliability of international money transfers made through the SWIFT system, as the correspondent banks that process those transfers have applied additional screening and, in some cases, delayed or returned payments. This has contributed to delays in payments to the Group, including the balance of the subscription proceeds due from the Ceres consortium, which is based in the Middle East. A prolonged or wider conflict could cause further delays to our receipt of financing proceeds and other payments.
Diesel prices and Tembo
Following the outbreak of hostilities involving Iran on February 28, 2026, and the resulting disruption to fuel flows through the Strait of Hormuz, diesel prices have risen sharply in Tembo’s key markets. The International Energy Agency has indicated in its Oil Market Report of October 2026 that tight diesel supply is likely to persist into 2027.
We believe that higher diesel prices improve the total cost of ownership case for electrifying light utility vehicle fleets in the mining, construction, agriculture, utilities and public sectors, and since March 2026 Tembo has experienced increased customer interest with purchase orders received for its products pre and post balance date. Tembo’s results remain subject to the risks described in Item 3.D, including its ability to fund production and fulfill orders, and there can be no assurance that higher fuel prices will result in sustained increased sales. Higher diesel prices may also increase logistics and component costs across the Group.
Proposed Tembo business combination and listing
On August 29, 2024, we entered into a business combination agreement, as subsequently amended, with CCTS and Tembo, under which Tembo would become a subsidiary of a new holding company listed on Nasdaq, in which we would retain a minority shareholding. Nasdaq has approved the use of the ticker “TEMB” for the combined company, which is currently contemplated to be named Tembo Group N.V. The registration statement on Form F-4 for the transaction remains under review by the SEC, and completion remains subject to that review, shareholder approvals and other closing conditions.
The timetable for the transaction has been extended beyond our original expectations, due to factors beyond our control including delays on the part of CCTS’s independent auditors, who are based in Israel and whose team members were affected by the regional conflict. This has affected the timeliness of the preparation, submission and review of documents filed with regulators. The transaction is also subject to expanded Nasdaq initial listing requirements adopted in 2025 and 2026, including the higher minimum market value of unrestricted publicly held shares and the higher thresholds applicable to companies listing through a business combination with a special purpose acquisition company, which have lengthened listing timetables for smaller companies generally.
We continue to execute on the transaction and have identified alternative pathways to achieve a public listing for Tembo. There can be no assurance that the Tembo business combination will be completed on the anticipated terms or timetable. Until completion, Tembo’s costs will continue to be consolidated in our results.
Other known uncertainties
Other known uncertainties include the matters described under “B. Liquidity and Capital Resources – Going concern”, changes in Norwegian regulation of data centers (described in Item 4.B “Regulation”), including proposed restrictions on crypto-mining data centers and operator registration requirements, the dilutive effect of our outstanding warrants and convertible preference shares and continued war and geopolitical conflict in the markets we operate in. In addition, we were made aware post balance date that the Norwegian Tax Administration (Skatteetaten) opened an audit of Nordland Data AS (now Arctic Norge Data I AS) in August 2025, before our acquisition of the company, covering value added tax and corporate income tax for the period from January 1, 2022 to February 28, 2025, and later extended its review of value added tax to 2021. As of the date of this Annual Report, no assessment has been made and no sanction or monetary claim has been notified to us. We cannot predict the outcome of the audit or whether it will result in any liability, or the extent to which any such liability could be recovered from the seller under the share purchase agreement.
E. Critical Accounting Estimates
Our critical accounting judgments and key sources of estimation uncertainty, including those relating to the accounting for the Mo i Rana Acquisition, the impairment of goodwill and intangible assets, the fair value of derivative and warrant liabilities and unlisted investments, the recoverability of receivables, provisions and going concern, are described in Note 3 to our consolidated financial statements.
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ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
A. Directors and Senior Management
The following table sets forth the names, ages and positions of our directors and executive officers. Unless otherwise indicated, the business address of all of our directors and executive officers is Suite 4, 7th Floor, 50 Broadway, London SW1H 0DB, United Kingdom.
| Name | Age | Position | Appointed | Resigned | ||||
| Directors: | ||||||||
| Kevin Chin (1) | 53 | Chairman | April 27, 2016 | |||||
| Peter Jeavons (1)(2)(3)(4) | 61 | Non-Executive Director | June 16, 2020 | |||||
| William Langdon (1)(2)(3)(4) | 65 | Non-Executive Director | June 16, 2020 | |||||
| Michael Hui (1)(4) | 46 | Non-Executive Director | January 22, 2020 | |||||
| Executive Officers: | ||||||||
| Kevin Chin (1)(4) | 53 | Chief Executive Officer | March 25, 2020 | |||||
| David Mansfield | 50 | Chief Financial Officer | May 21, 2025 | May 31, 2026 | ||||
| Jacqui Johnson | 60 | Global HR Director | July 1, 2021 | |||||
| Chris Mallios | 55 | Chief Commercial Officer | January 29, 2024 | |||||
| Keith Loose | 47 | Chief Technology Officer | May 9, 2025 | March 2, 2026 | ||||
| Syed Muhammad Nouman | 40 | Group Finance Director, Accounting and Finance | July 20, 2026 | |||||
| Gary Challinor | Company Secretary | December 16, 2025 |
| (1) | Member (or in the case of Mr. Chin, non-voting observer) of the Audit and Risk Committee. |
| (2) | Member of the Remuneration Committee. |
| (3) | Member of the Nomination Committee. |
| (4) | Member of the Sustainability Committee |
The following sets forth biographical information regarding our directors and executive officers. There are no family relationships between any director or executive officer and any other director or executive officer.
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There are no other arrangements or understandings with major shareholders, customers, suppliers or others, pursuant to which any person referred to above was selected as a director or member of senior management, except that: Kevin Chin, our chairman, beneficially owns 14.3% of VIVO at June 30, 2026, through his various holdings including AWN.
Recent Changes to the Board of Directors and Senior Management
On 19 February 2026, the Company announced the departures of David Mansfield, Chief Financial Officer, and Keith Loose, Chief Technology Officer, as part of the Group’s strategic repositioning. On 20 July 2026, Syed Muhammad Nouman, FCA, was appointed Group Finance Director with effect from that date. He also serves as Principal Financial Officer and Principal Accounting Officer for the purposes of the Company’s SEC reporting obligations.
Their biographies are set out below.
Executive Officers
Kevin Chin
Kevin Chin has served as our Chief Executive Officer since March 2020. Reference is made to his biography below.
Chris Mallios
Chris Mallios has served as the Chief Operating Officer of Tembo since March 2024; before this he also served on VivoPower’s board of advisors from October 2020 until March 2024. Mr. Mallios is a seasoned executive with nearly 30 years of experience in the automotive, technology, resources, utilities and infrastructure industries. He has held several leadership positions at Nissan Motor Corporation, including as director of global business operations for Infiniti, managing director of Infiniti’s Asia and Oceania regions and director of business development in China. In the latter role, he oversaw the joint venture of Nissan and the Dongfeng Motor Corporation to produce Infiniti vehicles for the world’s biggest automotive market. His background also includes nearly five years as the CEO of CFC Group, an investment and development group that provides distribution, logistics and transport services, and nearly a decade as Asia Pacific CFO for TE Connectivity, a global technology company whose solutions power, among other things, electric vehicles.
Mr. Mallios is a CPA Australia Fellow and holds bachelor’s and master’s degrees from the University of New South Wales. He has further completed executive programs as a Graduate member of the Australian Institute of Company Directors and INSEAD’s global top executive leadership AVIRA Programme.
David Mansfield
David Mansfield served as our Chief Financial Officer from May 2025 until May 31, 2026. Mr. Mansfield has a strong background in finance, with expertise in structured financing, platform development, and technology optimization. He began his career in Structured Fixed Income Derivatives then moved to Goldman Sachs, where he helped establish its Equity Derivatives Financing business.
In 2005, Mr. Mansfield relocated to Asia, where he successfully built Structured Derivatives Trading businesses for both Credit Suisse and J.P. Morgan. His career has spanned leadership roles in major investment banks and high-growth ventures, including serving as the chief financial officer of VinFast Auto Ltd. (Nasdaq: VFS), an electric vehicle company, from February 2022 to January 2024, where he played a key role in the company’s listing on Nasdaq through a reverse merger with a SPAC.
Jacqui Johnson
Jacqui Johnson has served as the Human Resources Director of Tembo since March 2021. Ms. Johnson is a seasoned human resources professional and a qualified member of the Chartered Institute of Personnel and Development with over 20 years of experience in human resources and change management across diverse industries, including the EV automotive, engineering, and construction industries.
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Ms. Johnson has held multiple leadership roles, specializing in employment law, recruitment, organizational planning, employee engagement, strategic workforce planning, company culture development, and employee well-being in both unionized and non-unionized environments.
Keith Loose
Mr. Loose worked in technology as a developer, security analyst and architect or head of engineering at JP Morgan, HSBC, CLSA, Block.One and Block Inc, and as a technology advisor, consultant or CTO for several firms. He also advised family offices and funds on technical due diligence and on trade execution systems, and held senior roles at investment banks, publicly listed technology firms, a retail crypto exchange and OTC brokerages. Mr. Loose left the company in May 2026.
Gary Challinor
Gary served as VivoPower’s Chief Financial Officer from November 2020 until March 2025 and was subsequently appointed Company Secretary on December 16, 2025.
Syed Muhammad Nouman
Nouman is VivoPower’s Group Finance Director and serves as the Company’s Principal Financial Officer and Principal Accounting Officer. He is a Fellow Chartered Accountant with more than 17 years of international finance and accounting leadership experience.
Nouman began his career at PwC and has since held senior leadership roles across the oil and gas, real estate, automation engineering and hospitality sectors. His expertise includes financial control and reporting, audit and risk management, IFRS and US GAAP, mergers and acquisitions, commercial finance, global tax management and working-capital optimization.
At VivoPower, Nouman oversees group financial control, statutory and public-company reporting, financial planning and audit readiness across the Company’s international operations. He also supports capital raising, corporate transactions, joint ventures and the execution of VivoPower’s strategic growth initiatives.
Directors
Kevin Chin
Kevin Chin is the founder of Arowana, a leading global B Corporation certified investment group with operating companies across the U.K., U.S., Europe, Asia, the Middle East and Australia, as well as owning other unlisted companies and investments. One of those operating companies is AWN which is an Australian unlisted holding company. AWN is a significant shareholder in VivoPower.
Over his 25-plus year career, Mr. Chin has accumulated extensive experience in “hands on” strategic and operational management having served as CEO, CFO and COO of various public and private companies across a range of industries, including solar energy, software, traffic management, education, funds management and vocational education. He is the author of the business book, HyperTurnaround! which chronicles the privatization, rapid turnaround, and subsequent global scale up of a software company called RuleBurst Haley culminating in a sale to Oracle. Mr. Chin has regularly written for Inc.com on topics such as turnarounds and growing pains challenges and has been interviewed by Entrepreneur.com and other key business publications. He also has significant international experience in private equity, buyouts of public companies, mergers and acquisitions and capital raisings as well as funds management, accounting, litigation support and valuations with prior roles at LFG, J.P. Morgan, PwC and Deloitte.
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Mr. Chin holds a Bachelor of Commerce degree from the University of New South Wales where he was one of the inaugural University Co-Op Scholars with the School of Banking and Finance. He is also a qualified Chartered Accountant and a Fellow of FINSIA, where he was a curriculum writer and lecturer in the Master of Applied Finance program. Mr. Chin resides primarily in the United Arab Emirates.
William Langdon
William Langdon has had a 25-plus year career in software, technology and enterprise data sectors after starting his career at Disney in finance and marketing. He served as CFO of venture-backed OmniTicket Network and after served in a series of senior management roles at digital mapping leader NAVTEQ (acquired by Nokia). After starting in European Sales, he became General Manager of the global Distribution division and President of NAVTEQ’s first acquisition, a digital mapping company based in Seoul, South Korea. Since that time, he has served in a series of senior management roles with venture-backed French technology start-ups including Goldman Sachs backed Nuxeo and Intersec, backed by Highland Europe.
Mr. Langdon received his MBA from Yale University and is a member of the Board of Directors of Tech2Deal, a private French company, and Singula Institute, a New York City based mental health non-profit organization. He resides in Long Island outside of New York City, United States.
Mr. Langdon serves as Chairman of the Audit and Risk Committee and the Nomination Committee of the Company.
Peter Jeavons
Peter Jeavons has over 30 years’ experience working in a number of executive-level international roles predominantly focused on leading technology and enterprise software solutions across many industry sectors. His career has been spent working for small start-ups, medium-sized and large corporate businesses, helping to drive strong growth, turnarounds and with involvement from both sides in successful merger and acquisition activities. He specializes in policy, regulatory and legislative compliance-based solutions and has a strong interest in how technology can help to drive sustainability and save the planet.
Mr. Jeavons was part of the global leadership team of RuleBurst Haley, which was acquired by Oracle and then successfully relaunched their regulatory compliance solution as a native SaaS platform internationally. During his career he has also worked for companies including Infor, who are another large enterprise software company and was responsible for the European business at Nuxeo, a Goldman Sachs backed, open source, enterprise content management software provider. He recently completed an interim CEO role for a next generation events management SaaS business.
He currently works as an advisor to several SaaS businesses and start-ups, specializing in innovative technologies that make the world better, less complex, and more sustainable. Mr. Jeavons completed his Non-Executive Director’s diploma with Pearson in 2013. He resides in the Cotswolds, United Kingdom.
Mr. Jeavons is the Senior Independent Director at VivoPower and Chairman of the Remuneration and Sustainability Committees of the Company.
Michael Hui
Michael Hui brings a unique background to the Board given his dual Information Technology and Law degrees and experiences. During his career, he has built significant expertise across a diverse range of sectors in both an investment as well as an operational capacity.
Mr. Hui served as Managing Director (Australasia) for VivoPower’s significant shareholder, AWN, and also the broader Arowana group’s activities in Australia and New Zealand from 2011 until 2024, when he ceased to be an employee of AWN. Previously, Michael was Co-founder and CEO of an online-payments business and spent more than 10 years as a lawyer practicing corporate and commercial law. He resides in Brisbane, Australia.
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B. Compensation
Directors and Executive Management Compensation
The tables below set out the compensation paid to our directors and executive officers for the year ended June 30, 2026 and year ended June 30, 2025 (in US Dollars).
| Year Ended June 30, 2026 | Salary
& Fees | Benefits | Pension | Long Term Incentives | Severance | DSU | Total | |||||||||||||||||||||
| Directors: | ||||||||||||||||||||||||||||
| Kevin Chin (Chair) 1 | $ | 87,951 | $ | - | $ | - | $ | - | $ | - | $ | 626,866 | $ | 714,817 | ||||||||||||||
| Peter Jeavons 2 | $ | 96,642 | $ | - | $ | - | $ | - | $ | - | $ | 156,716 | $ | 253,358 | ||||||||||||||
| William Langdon 3 | $ | 95,750 | $ | - | $ | - | $ | - | $ | - | $ | 156,716 | $ | 252,466 | ||||||||||||||
| Michael Hui 4 | $ | 97,835 | $ | - | $ | - | $ | - | $ | - | $ | 156,716 | $ | 254,552 | ||||||||||||||
| Executive Officers: | ||||||||||||||||||||||||||||
| Kevin Chin 5 | $ | 469,515 | $ | - | $ | - | $ | - | $ | - | $ | - | $ | 469,515 | ||||||||||||||
| Year Ended June 30, 2025 | Salary
& Fees | Benefits | Pension | Long Term Incentives | Severance | Total | ||||||||||||||||||
| Directors: | ||||||||||||||||||||||||
| Kevin Chin (Chair) 1 | $ | 87,953 | $ | - | $ | - | $ | - | $ | - | $ | 87,953 | ||||||||||||
| Peter Jeavons 2 | $ | 73,000 | $ | - | $ | - | $ | - | $ | - | $ | 73,000 | ||||||||||||
| William Langdon 3 | $ | 65,500 | $ | - | $ | - | $ | - | $ | - | $ | 65,500 | ||||||||||||
| Michael Hui 4 | $ | 50,000 | $ | - | $ | - | $ | - | $ | - | $ | 50,000 | ||||||||||||
| Executive Officers: | ||||||||||||||||||||||||
| Kevin Chin 5 | $ | 466,834 | $ | - | $ | - | $ | - | $ | - | $ | 466,834 | ||||||||||||
| 1 | Mr. Chin is paid a fee of GBP 68,000 (US$ 87,951) per annum as Executive Chairman during the year. | |
| 2 | Mr. Jeavons was paid fees of US$ 96,642 during the year, Until January 31, 2026 Mr. Jeavons received an annual base board fee of US$ 50,000, together with an annual fee of US$ 7,500 as chair of the sustainability committee, US$ 7,500 as chair of the remuneration committee, US$ 4,000 as member of the audit and risk committee and US$ 4,000 as member of the nomination committee. With effect from February 1, 2026 the base board fee was revised to US$ 155,000 per annum, of which US$ 77,500 is payable in cash, and his committee fees were revised to US$ 15,000 as chair of the sustainability committee, US$ 20,000 as chair of the remuneration committee, US$ 15,000 as member of the audit and risk committee and US$ 7,500 as member of the nomination and governance committee. Mr. Jeavons elected to receive 100% of his fees for the year in cash. | |
| 3 | Mr. Langdon was paid fees of US$ 95,750 during the year, comprising a board retainer of US$ 61,458 and committee fees of US$ 34,292. Until January 31, 2026 Mr. Langdon received an annual base board fee of US$ 50,000, together with an annual fee of US$ 7,500 as chair of the audit and risk committee, US$ 4,000 as member of the remuneration committee and US$ 8,000 as chair of the nomination committee. With effect from February 1, 2026 the base board fee was revised to US$ 155,000 per annum, of which US$ 77,500 is payable in cash, and his committee fees were revised to US$ 30,000 as chair of the audit and risk committee, US$ 10,000 as member of the remuneration committee and US$ 15,000 as chair of the nomination and governance committee. Mr. Langdon elected to receive 100% of his cash fees in cash. | |
| 4 | Mr. Hui’s fees for the year were US$ 97,835, comprising board fees of US$ 61,458, audit and risk committee fees of US$ 7,583 and sustainability committee fees of US$ 1,333. Until January 31, 2026 Mr. Hui received an annual base board fee of US$ 50,000 and, from the second quarter of FY26, an annual fee of US$ 4,000 as a member of the audit and risk committee. With effect from February 1, 2026, the base board fee was revised to US$ 155,000 per annum, of which US$ 77,500 is payable in cash, and the audit and risk committee fee to US$ 15,000 per annum. Mr. Hui is also a member of the sustainability committee, for which a fee of US$ 4,000 per annum (US$ 7,500 from February 1, 2026) is payable only for periods in which the committee meets. Mr. Hui elected to receive 100% of his cash fees in cash. | |
| 5 | Comprises £325,000 base fees per annum, £38,000 annual professional development allowance per annum. |
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Employment Agreements
Executive Agreements
Mr. Chin’s remuneration as Chief Executive Officer has remained at £325,000 per annum as Chief Executive since July 1, 2020, payable monthly in arrears. This remuneration plan was decided upon by the Remuneration Committee following a market benchmarking by Pearl Meyer, to align to the new strategy and additional responsibilities. The remuneration includes the cost of any support resources required by Mr. Chin to fulfil the roles. The Committee also approved an additional annual £38,000 fee payable as a professional development allowance to Mr. Chin, as Chief Executive Officer. This payment is to be made on January 1 each year. Mr. Chin has elected to take the significant majority of this remuneration in the form of shares of the Company for FY24, FY25 and FY26.
Mr. Chin is also paid an annual Chairman’s fee of £68,000 as Chairman of the Board, payable by the Company to Arowana Global Impact Pty Ltd (formerly Arowana Partners Group Pty Ltd). The fee was increased as from July 1, 2021, following a review by the Remuneration Committee of Mr. Chin’s compensation, including market benchmarking by Pearl Meyer but has been held at this level since then.
Potential Payments Upon Termination or Change in Control
Kevin Chin, Executive Chairman and Chief Executive Officer, may be terminated upon twelve months’ notice at any time, for any reason, with or without cause. Other than the twelve-month notice period, there are no other special payments upon termination or change of control.
The appointment letters of the non-executive directors of the Company are generally terminable upon one month’s written notice and do not contain provisions providing for special payments upon termination or change of control.
C. Board Practices
Board Composition and Classification of Directors
In accordance with the terms of our articles of association, our Board is divided into three staggered classes of directors of the same or nearly the same number and each will be assigned to one of the three classes. At each annual general meeting of the shareholders, a class of directors will be elected for a three-year term to succeed the directors of the same class whose terms are then expiring. The terms of the directors will expire upon the election and qualification of successor directors at the annual general meeting of shareholders to be held during the years 2026 for Class A directors, 2027 for Class B directors and 2028 for Class C directors:
| ● | our Class A directors are Peter Jeavons and Michael Hui. | |
| ● | our Class B director is William Langdon. | |
| ● | our Class C director is Kevin Chin. |
Our articles of association provide that the number of our directors shall not be subject to any maximum but shall not be less than two, unless otherwise determined by a majority of our Board.
The division of our Board into three classes with staggered three-year terms may delay or prevent shareholder efforts to effect a change of our management or a change in control.
Director Independence
Rule 5605 of the Nasdaq Listing Rules requires a majority of a listed company’s board of directors to be comprised of independent directors within one year of listing. Under Rule 5605(a)(2), a director will only qualify as an “independent director” if, in the opinion of our Board, that person does not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.
Our Board has determined that Peter Jeavons, Michael Hui and William Langdon are “independent directors” under Rule 5605 of the Nasdaq Listing Rules.
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Corporate Governance
The Sarbanes-Oxley Act of 2002, as well as related rules subsequently implemented by the SEC, requires foreign private issuers, including our company, to comply with various corporate governance practices. In addition, Nasdaq rules provide that foreign private issuers may follow home country practice in lieu of the Nasdaq corporate governance requirements, subject to certain exceptions and except to the extent that such exemptions would be contrary to U.S. federal securities laws.
Nasdaq Listing Rule 5615(a)(3) permits a foreign private issuer like us to follow home country practices in lieu of certain requirements of Listing Rule 5600, provided that certain requirements are met. Accordingly, we have elected to follow home country practice in lieu of the requirements under Nasdaq Listing Rule 5635(d), which requires companies to seek shareholder approval for the issuance of securities in connection with certain transactions other than a public offering involving the sale, issuance or potential issuance of our Class A Ordinary Shares at a price less than certain referenced prices, if such shares equal 20% or more of the Company’s Class A Ordinary Shares or voting power outstanding before the issuance. Instead, and in accordance with the Nasdaq home country accommodations, we comply with applicable U.K. corporate and securities laws, which do not require shareholder approval for such dilutive events.
We intend to take all actions necessary for us to maintain compliance as a foreign private issuer under the applicable requirements of the rules adopted by the SEC.
Since March 18, 2026, as a result of the Holding Foreign Insiders Accountable Act, our directors and officers have been subject to the beneficial ownership reporting requirements of Section 16(a) of the Exchange Act and are required to file reports of their beneficial ownership of, and transactions in, our equity securities with the SEC on Forms 3, 4 and 5. Because we are a foreign private issuer, they remain exempt from the short-swing profit recovery provisions of Section 16(b) and the short-sale restrictions of Section 16(c) of the Exchange Act. Our directors, officers and principal shareholders are also subject to the obligations to report beneficial ownership of more than 5% of our Class A Ordinary Shares under Section 13 of the Exchange Act and related SEC rules.
The Board met four times during the year, together with additional meetings convened on an ad hoc basis where a matter could not wait for the next scheduled meeting. Board papers are circulated in advance and follow a set agenda to which further items are added as required.
Matters reserved to the Board include approval of the annual budget, significant capital expenditure, acquisitions and disposals, funding transactions and the annual report and financial statements. Significant investments follow the five-stage Investment Committee process, so that the Board receives legal, technical and financial analysis and a risk assessment before it is asked to commit the Group.
Committees of the Board
The Board is supported by the Audit and Risk Committee, the Remuneration Committee, the Nomination and Governance Committee and the Sustainability Committee, each of which operates under a written charter and reports to the Board.
Audit and Risk Committee
The Audit and Risk Committee is comprised of William Langdon (who is Chair of the Audit and Risk Committee), Michael Hui and Peter Jeavons, each of whom the Board has determined to be independent under the applicable Nasdaq listing standards. Peter Jeavons and William Langdon joined the committee on June 16, 2020. Michael Hui joined the committee in Q2 FY26.
The Audit and Risk Committee has a written charter, a form of which is available on VivoPower’s website at www.vivopower.com.
The purpose of the Audit and Risk Committee, as specified in the Audit and Risk Committee charter, includes, but is not limited to, assisting the Board in overseeing and monitoring:
| ● | the Company’s accounting and financial reporting processes and internal control over financial reporting; | |
| ● | the audit and integrity of the Company’s financial statements; | |
| ● | the qualifications, independence, and performance of the Company’s registered public accounting firm; | |
| ● | the Company’s compliance with accounting, regulatory and related legal requirements; | |
| ● | risk assessment and risk management; and | |
| ● | such other duties and responsibilities as are enumerated in or consistent with the terms of reference. |
The Audit and Risk Committee is required to be composed exclusively of “independent directors,” as defined under the Nasdaq listing standards and the rules and regulations of the SEC, and each of whom must be, among other requirements, “financially literate,” as defined under the Nasdaq listing standards. The Nasdaq listing standards define “financially literate” as being able to read and understand fundamental financial statements, including a company’s balance sheet, income statement and cash flow statement. In addition, VivoPower is required to certify to Nasdaq that the committee has at least one member who has past employment experience in finance or accounting, requisite professional certification in accounting, or other comparable experience or background that results in the individual’s financial sophistication.
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The Board has determined that William Langdon satisfies Nasdaq’s definition of financial sophistication and qualifies as an “audit committee financial expert” as defined in Item 16A of Form 20-F. Each member of the Audit and Risk Committee meets the independence requirements of Rule 10A-3 under the Exchange Act.
Nomination and Governance Committee
The Nomination and Governance Committee of the Board is comprised of William Langdon (who is Chair of the Nomination and Governance Committee), and Peter Jeavons, each of whom the Board has determined to be independent under the applicable Nasdaq listing standards. William Langdon and Peter Jeavons joined the committee on June 16, 2020.
The Nomination and Governance Committee has a written charter, a form of which is available on VivoPower’s website at www.vivopower.com.
The Nomination and Governance Committee is responsible for overseeing the selection of persons to be nominated to serve on VivoPower’s Board.
The Nomination and Governance Committee consider persons identified by its members, management, shareholders, investment bankers and others. Pursuant to its charter, the Nomination and Governance Committee, before any appointment is made by the Board, evaluates the balance of skills, knowledge, experience and diversity on the Board, and, in the light of this evaluation, prepares a description of the role and capabilities required for a particular appointment, and consider candidates on merit and against objective criteria and with due regard for the benefits of diversity on the Board, taking care that appointees have enough time available to devote to the position.
The Nomination and Governance Committee considers a number of qualifications relating to management and leadership experience, background and integrity and professionalism in evaluating a person’s candidacy for membership on the Board. The Nomination and Governance Committee may require certain skills or attributes, such as financial or accounting experience, to meet specific Board needs that arise from time to time and will also consider the overall experience and makeup of its members to obtain a broad and diverse mix of Board members. The Nomination and Governance Committee will not distinguish among nominees recommended by shareholders and other persons.
Remuneration Committee
The Remuneration Committee is comprised of Peter Jeavons (Chair of the Remuneration Committee), and William Langdon, each of whom the Board has determined is independent under the applicable Nasdaq listing standards. Peter Jeavons and William Langdon joined the committee on June 16, 2020.
The Remuneration Committee has a written charter, a form of which is available free of charge on VivoPower’s website at www.vivopower.com.
The Remuneration Committee’s duties, which are specified in our Remuneration Committee Charter, include, but are not limited to:
| ● | setting the remuneration policy for all executive directors and executive officers, including pension rights and any compensation payments; | |
| ● | reviewing the appropriateness and relevance of the remuneration policy; | |
| ● | determining total individual compensation packages; | |
| ● | reviewing and designing share incentive and share option plans, determining awards thereunder and administering such plans; | |
| ● | approving design of, and targets for, performance-related pay schemes; | |
| ● | determining pension arrangements; | |
| ● | appointing compensation consultants; | |
| ● | approving contractual appointment terms for directors and senior executives; and | |
| ● | related duties. |
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Sustainability Committee
The Sustainability Committee was formed on 18 December 2020 and is comprised of Peter Jeavons (Chair of the Sustainability Committee), Michael Hui and William Langdon.
The Sustainability Committee has a written charter, a form of which is available on VivoPower’s website at www.vivopower.com.
The Sustainability Committee’s duties, which are specified in our Sustainability Committee Charter include, but are not limited to:
| ● | oversee and monitor VivoPower’s Safety and Health policies, procedures and programs and track any safety and health scorecards against benchmarks; | |
| ● | review VivoPower’s B Corp certification and governance policies and initiatives with a view to continuously improving VivoPower’s B score; | |
| ● | maintain, update and review the effectiveness of VivoPower’s environmental policies and initiatives designed to ensure environmental sustainability and the minimization of the Company’s environmental footprint; | |
| ● | review the effectiveness of VivoPower’s policies and initiatives with regards to community and staff engagement as well as broader corporate social responsibility; and | |
| ● | oversee and monitor the reputational impacts of VivoPower’s business strategies and practices, including policies and to ensure appropriate safeguards are in place for dealing fairly and ethically with customers, suppliers, competitors and other employees. |
Code of Business Conduct and Ethics
We have adopted a Code of Business Conduct and Ethics applicable to all of our directors, executive officers and employees, including our chief executive officer, chief financial officer, controller, or other persons performing similar functions, which is a “code of ethics” as defined in Item 16B of Form 20-F promulgated by the SEC. The full text of the Code of Business Conduct and Ethics is posted on the investor relations section of our website at www.vivopower.com.
If we make any amendment to the Code of Business Conduct and Ethics or grant any waivers, including any implicit waiver, from a provision of the Code of Business Conduct and Ethics, we will disclose the nature of such amendment or waiver on our website to the extent required by the rules and regulations of the SEC. Under Item 16B of Form 20-F, if a waiver or amendment of the Code of Business Conduct and Ethics applies to our principal executive officer, principal financial officer, or controller and relates to standards promoting any of the values described in Item 16B(b) of Form 20-F, we are required to disclose such waiver or amendment on our website in accordance with the requirements of Instruction 4 to such Item 16B.
D. Employees
As of June 30, 2026, we had 14 (June 30, 2025: 41; June 30, 2024: 94) employees and subcontractors, as follows:
| As at June 30, 2026 | Australia | US | U.K. | Netherlands | Singapore | Philippines | Dubai | Norway | Total | |||||||||||||||||||||||||||
| Sales and Business Development | - | 1 | 1 | - | - | - | - | - | 2 | |||||||||||||||||||||||||||
| Central Services and Management | 4 | - | - | - | - | - | 2 | - | 6 | |||||||||||||||||||||||||||
| Engineering and Critical Power Services | - | - | - | 1 | - | - | - | - | 1 | |||||||||||||||||||||||||||
| Data center | 5 | 5 | ||||||||||||||||||||||||||||||||||
| Total employees | 4 | 1 | 1 | 1 | - | - | 2 | 5 | 14 | |||||||||||||||||||||||||||
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| As at June 30, 2025 | Australia | US | U.K. | Netherlands | Singapore | Philippines | Dubai | Pakistan | Total | |||||||||||||||||||||||||||
| Sales and Business Development | 4 | 1 | 1 | - | 4 | - | 1 | - | 11 | |||||||||||||||||||||||||||
| Central Services and Management | 4 | 2 | 1 | - | 4 | 2 | 1 | - | 14 | |||||||||||||||||||||||||||
| Engineering and Critical Power Services | 2 | - | 4 | 2 | 2 | - | 4 | 2 | 16 | |||||||||||||||||||||||||||
| Total employees | 10 | 3 | 6 | 2 | 10 | 2 | 6 | 2 | 41 | |||||||||||||||||||||||||||
We have never experienced labor-related work stoppages or strikes and believe that we have good relations with our employees.
E. Share Ownership
The following table sets forth information regarding the beneficial ownership of VivoPower Class A Ordinary Shares as of June 30, 2026, by:
| ● | each of our executive officers and directors; and | |
| ● | all of our executive officers and directors as a group. |
The beneficial ownership of VivoPower’s Class A Ordinary Shares is based on 30,724,084 Class A Ordinary Shares issued and outstanding on June 30, 2026. Beneficial ownership is determined according to the rules of the SEC, which generally provide that a person has beneficial ownership of a security if such person has or shares the power to vote or direct the voting thereof, or to dispose or direct the disposition thereof or has the right to acquire such powers within 60 days.
Unless otherwise indicated, we believe that all people named in the table below have sole voting and investment power with respect to all Class A Ordinary Shares beneficially owned by them.
Name and Address of Beneficial Owner (1) | Number of Shares Beneficially Owned | Percentage of Outstanding Shares | ||||||
| Kevin Chin (1) | 4,397,828 | (2) | 14.3 | % | ||||
| Peter Jeavons | 93,482 | <1 | % | |||||
| William Langdon | 46,567 | <1 | % | |||||
| Michael Hui | 33,617 | <1 | % | |||||
| All Directors and Executive Officers as a group (4 persons) | 4,571,494 | 14.9 | % | |||||
| (1) | As of 30 June 2026, Kevin Chin, through various entities, held a total of 3,506,210 shares of VIVO. The holdings are distributed as follows: the Panaga Group Trust holds 103,921 shares, Arowana Global Impact Pty Ltd holds 3,076,446 shares, Arowana International UK Ltd holds 295,000 shares, the Chin Family Super Fund holds 28,275 shares, and the KTFC Super Fund holds 2,568 shares. Together with the 891,618 shares held by AWN described in footnote (2), Mr. Chin is deemed to beneficially own 4,397,828 Class A Ordinary Shares. |
| (2) | Represents 891,618 shares held by AWN and its subsidiaries including Arowana Australasian Special Situations Fund 1 Pty Limited (“Arowana Fund Co”), Arowana Australasian VCMP 2, LP (“Arowana Fund GP”), Arowana Australasian Special Situations Partnership 1, LP (“Arowana Fund”), Arowana Energy Holdings Pty Ltd. (“Arowana Energy”), AWN, as the controlling shareholder of each entity is deemed to beneficially own 891,618 Class A Ordinary Shares. The business address of these entities is c/o AWN Holdings Limited, at Level 11, 110 Mary Street, Brisbane, Queensland 4000, Australia. This does not include 1.2 million warrants held by AWN. |
None of the above shareholders have different voting rights from other shareholders as of the date of this Annual Report.
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Equity Incentive Plan
On July 3, 2017, the Board approved adoption of the Company’s 2017 Omnibus Incentive Plan (the “Incentive Plan”), which was subsequently approved by shareholders. The purpose of the Incentive Plan is to provide a means through which the Company and its subsidiaries may attract and retain key personnel and to provide a means whereby personnel of the Company and its subsidiaries can acquire and maintain equity interests in the Company and align their interests with those of the Company’s shareholders. Types of awards that may be granted under the Incentive Plan include options, stock appreciation rights, restricted stock and restricted stock units, stock bonus awards and performance compensation awards. The Remuneration Committee of the Board administers the Incentive Plan and determines the terms and conditions of the awards. Awards are evidenced by an award agreement containing the terms and conditions of each award. Under the Incentive Plan (or a Sub-Plan for Non-Employees that was also approved with the Incentive Plan), the Company may grant awards to employees, executives, officers, consultants, or advisors of the Company or its subsidiaries.
On July 6, 2023, the shareholders approved an amendment to the Incentive Plan allowing the number of Class A Ordinary Shares reserved under the Incentive Plan to automatically increase each July 1, beginning on July 1, 2023, and ending on July 2, 2032, by 5.0% of the outstanding number of Class A Ordinary Shares on the immediately preceding June 30, or such lesser amount as determined by the Company’s Remuneration Committee.
On October 4, 2023, the Company announced a one-for-ten (1-for-10) reverse stock split and par value change of its Class A Ordinary Shares which began trading on a post-split basis on October 6, 2023. In accordance with the terms of the Incentive Plan, outstanding awards were adjusted proportionately to reflect the reverse stock split.
On January 30, 2026, the shareholders approved an increase in the maximum number of Class A Ordinary Shares that may be issued under the Incentive Plan from 10% to 15% of the Company’s issued share capital. The Incentive Plan was amended and restated on February 27, 2026 to reflect this increase, and now permits the issue of up to 15% of the Class A Ordinary Shares issued and outstanding from time to time on a fully-diluted basis, in addition to the annual increase described above.
During the financial years ended 30 June 2026, 2025, and 2024, the following awards, including Restricted Stock Units (RSUs), Performance Stock Units (PSUs) and Stock Subscription Warrants (BSAs), under the Incentive Plan have been granted, and have vested or forfeited:
| Number
of RSUs, PSUs and BSAs (thousands) | Weighted average grant date fair value $000 | |||||||
| Outstanding at June 30, 2023 | 657 | $ | 331 | |||||
| Granted | 128 | 234 | ||||||
| Vested/Settled | (150 | ) | (248 | ) | ||||
| Reverse stock split impact | (591 | ) | (298 | ) | ||||
| Forfeit | (11 | ) | (3 | ) | ||||
| Outstanding at June 30, 2024 | 33 | $ | 16 | |||||
| Granted | 151 | 613 | ||||||
| Vested | (95 | ) | (323 | ) | ||||
| Forfeit | - | - | ||||||
| Outstanding at June 30, 2025 | 89 | 306 | ||||||
| Granted | 1,132 | 5,102 | ||||||
| Vested | (1,026 | ) | (4,777 | ) | ||||
| Forfeit | (31 | ) | (110 | ) | ||||
| Outstanding at June 30, 2026 | 164 | 521 | ||||||
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Tembo Long Term Incentive Plan
During FY23, Tembo e-LV BV established a performance incentive plan for participants to benefit from any potential future trade sale, IPO, recapitalization or merger of Tembo e-LV and subsidiaries within the EV business unit. In the event of such an action, participants will earn Long Term Incentive (“LTI”) points according to an allocation decided by the Remuneration Committee of a profit share of 20% of the net gain made by the Company from the corporate action, less previously invested amounts.
F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation
As described in Note 35 to our consolidated financial statements, we restated our consolidated financial statements as of and for the year ended June 30, 2025. We evaluated the restatement under our Policy for the Recovery of Erroneously Awarded Compensation, Nasdaq Listing Rule 5608 and Rule 10D-1 under the Exchange Act. No current or former executive officer received incentive-based compensation during the applicable recovery period that was based on the financial reporting measures affected by the restatement. Accordingly, no erroneously awarded compensation was identified, and no amount was outstanding to be recovered as of June 30, 2026.
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
A. Major Shareholders
The following table sets forth information with respect to beneficial ownership of our Class A Ordinary Shares as of June 30, 2026 by each person known to us to beneficially own 5% and more of our Class A Ordinary Shares.
The beneficial ownership of VivoPower’s Class A Ordinary Shares is determined based on 30,724,084 Class A Ordinary Shares issued and outstanding on June 30, 2026. Beneficial ownership is determined according to the rules of the SEC, which generally provide that a person has beneficial ownership of a security if such person has or shares the power to vote or direct the voting thereof, or to dispose or direct the disposition thereof or has the right to acquire such powers within 60 days.
| Name and address of Beneficial Owner | Amount
and Nature of Beneficial Ownership | Approximate Percentage of Beneficial Ownership | ||||||
| Kevin Chin (1) | 4,397,828 | (2) | 14.3 | % | ||||
| TAG INTL DMCC(Emirates family office) | 6,500,000 | 21.2 | % | |||||
| LIAN Group | 2,562,316 | 8.3 | % | |||||
| (1) | As of 30 June 2026, Kevin Chin, through various entities, held a total of 3,506,210 shares of VIVO. The holdings are distributed as follows: the Panaga Group Trust holds 103,921 shares, Arowana Global Impact Pty Ltd holds 3,076,446 shares (including 2,481,531 newly issued shares), Arowana International UK Ltd holds 295,000 shares, the Chin Family Super Fund holds 28,275 shares, and the KTFC Super Fund holds 2,568 shares. Together with the 891,618 shares held by AWN described in footnote (2), Mr. Chin is deemed to beneficially own 4,397,828 Class A Ordinary Shares. This does not include the 1.2 million warrants issued to AWN. |
| (2) | Represents 891,618 shares held by AWN and its subsidiaries including Arowana Australasian Special Situations Fund 1 Pty Limited (“Arowana Fund Co”), Arowana Australasian VCMP 2, LP (“Arowana Fund GP”), Arowana Australasian Special Situations Partnership 1, LP (“Arowana Fund”), Arowana Energy Holdings Pty Ltd. (“Arowana Energy”), AWN, as the controlling shareholder of each entity is deemed to beneficially own 891,618 Class A Ordinary Shares. The business address of these entities is c/o AWN Holdings Limited, at Level 11, 110 Mary Street, Brisbane, Queensland 4000, Australia. |
None of the above shareholders have different voting rights from other shareholders as of the date of this Annual Report.
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B. Related Party Transactions
Transactions and Balances with Related Persons
Related party transactions are subject to the Company’s conflict of interest review and approval procedures described below.
Kevin Chin, Chairman and Chief Executive Officer of VivoPower, is also Chairman and Chief Executive Officer of AWN. As of June 30, 2026, AWN held a 2.9% equity interest in the Company.
During the period, a number of services, including financing support were provided to the Company from AWN and its subsidiaries; the extent of the transactions between the two groups is listed below.
The disclosures below retain the history of transactions through June 30, 2025 and add developments for the year ended June 30, 2026 and subsequent events. Terms and balances described for earlier dates are historical and do not represent the terms or balances at June 30, 2026; the dated FY2026 disclosures and subsequent-event disclosures describe the later position.
On June 30, 2021, the Company agreed to refinance its existing $21.1 million shareholder loan with AWN Holdings Limited (“AWN”), with repayment of principal from January 1, 2023 in sixty monthly instalments of $0.35 million to loan maturity on December 31, 2027. The interest rate and line fee were agreed at 8% and 0.8% respectively, but no interest or line fee settlements are required until after a corporate liquidity event has occurred. In addition, the Company agreed to a refinancing fee of $0.34 million in two tranches on June 30, 2022 and December 31, 2022. Security granted to AWN comprised of the Specific Security Deed and the General Security.
On January 11, 2023, amendments to the loan were agreed with AWN:
(i) to defer repayment of principal to commence on April 1, 2025, with repayments over 60 months to March 31, 2030.
(ii) to defer interest payments from October 1, 2023, becoming due and payable on the earlier of a) completion by VivoPower of a debt or equity raise of at least $25 million, and b) October 1, 2024.
(iii) to extend the increased interest rate and line fee of 10.00% and 2.00% per annum respectively commenced on October 1, 2021 to the earlier of a) March 31, 2025 or b) the date a minimum prepayment of $1,000,000 is made.
(iv) to extend the initial refinancing fee accruing incrementally at 1.6% per annum from July 1, 2021 and become payable at the earlier of a) $1.0 million prepayment being made or b) April 1, 2025.
(v) to defer the repayment date of the previous fixed facility extension fee of $0.355 million, becoming payable on April 1, 2025.
(vi) In addition to previously agreed refinancing fees, an additional $0.855 million fixed refinancing fee will accrue immediately and become payable on April 1, 2025.
On June 30, 2023, further amendments to the loan were agreed with AWN:
(i) to defer interest payments from October 1, 2024 to April 1, 2025, and to replace the conditional requirement to repay accrued interest upon completion by VivoPower of a debt or equity raise of at least $25 million, with the conditional requirement to make repayments of interest and/or principal to meet the mandatory repayment schedule described in sections (ii) and (iii) below following a qualifying liquidity event.
(ii) upon completion by VivoPower PLC of a qualifying liquidity event of at least $5.0 million, Aevitas O Holdings Pty Limited are required to make mandatory prepayment of principal and interest to AWN in accordance with the following schedule:
a) proceeds $5 million to $7.5 million - pay 25% of amounts raised;
b) proceeds $7.5 million to $12.5 million - pay $1.875 million plus 45% of amounts raised;
c) proceeds $12.5 million and above - pay $4.125 million plus 25% of amounts raised.
(iii) for the purposes of the mandatory prepayment requirement, a ‘qualifying liquidity event’ excludes direct investments into VivoPower’s subsidiary, Tembo, and debt raised in respect of working capital finance facilities, but includes:
a) equity or debt raise;
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b) trade sale of underlying subsidiary or business unit (including, for example, Aevitas and Caret); and
c) loan repayment from Tembo to VivoPower.
(iv) as consideration for the concessions agreed with AWN on June 30, 2023, VivoPower PLC committed to issue AWN with 500,000 warrants, with a duration of 12 months, at an exercise price of $6.70 per share. These warrants were not exercised and were subsequently cancelled.
On June 30, 2024, VivoPower amended its shareholder loan financing agreement with AWN. At that date, the loan included a facility limit of $34 million, of which a drawdown of $8.1 million principal was due to be repaid in the then-current period, and $20.9 million principal was non-current. In addition, there was $12 million in interest and fees on the AWN loan due to be repaid in the then-current period. The agreement consolidated all shareholder loans into a single tranche. AWN also received an option to acquire 1,150,000 Tembo shares, post-business combination with Cactus Acquisition Corp 1 Limited at $1.35 per share. On November 23, 2024 AWN agreed to a 9 month grace period for the repayment of $11 million accrued interest, and a deferral of $8.9 million of principal for repayment from April 1, 2025 to January 1, 2026. The resulting historical classification was non-current for all but $1 million of interest and for all loan principal; this is not the classification at June 30, 2026. In lieu of deferring the repayment, VivoPower issued 1.2 million cashless warrants to AWN.
Shareholder loan with AWN
Following the June 30, 2024 amendment, the AWN loan facilities were amended and restated under a Deed of Assignment, Novation and Amendment and Restatement dated on or about June 30, 2024. VivoPower PLC is the borrower and Aevitas O Holdings Pty Limited is a guarantor. Security granted to AWN comprises a debenture granted by VivoPower PLC; the Specific Security Deed granted by Aevitas O Holdings, including over its shares in Aevitas Group Limited; and a Jersey-law security agreement granted by VivoPower PLC, including over its shares in VivoPower International Services Limited.
The interest rate is 8% per annum and the line fee is 0.8% per annum. The loan matures on March 31, 2030, with monthly principal repayments from April 1, 2025 of the lesser of the outstanding principal and 1/60th of the maximum advances. The overdue rate is the applicable rate plus 2% per annum.
During the year the Company repaid $1.6 million of principal in July 2025. Principal outstanding decreased from $21.0 million to $19.4 million. At June 30, 2026, accrued interest and fees on this loan were $14.2 million, comprising interest of $9.3 million, line fees of $1.9 million, refinancing fees of $1.7 million, extension fees of $1.2 million and establishment fees of $0.075 million. No interest or fees were paid during the year.
Mandatory prepayments apply on a qualifying liquidity event, including capital or debt raises or proceeds from disposals, with 20% of proceeds below $5.0 million, rising to $3,275,000 plus 45% of proceeds of $12.5 million or more. A change of control or sale of substantially all assets makes the full balance immediately repayable.
In December 2021, a short term loan of $1.1 million (AU$1.5 million) was provided from AWN to Aevitas O Holdings Pty Limited at an interest rate of 10.0%, increasing to 12.5% from January 1, 2022. Under the historical terms, the loan was due to expire on April 1, 2025 (initially set as April 30, 2022, then extended on June 30, 2022, to October 1, 2023, then extended on January 11, 2023 to April 1, 2025). The requirement for the loan to expire upon completion by VivoPower PLC of a debt or equity raise of at least $25 million was dropped on June 30, 2023. Facility extension fees of $29,000 (AU$40,000) and $43,500 (AU$60,000) are payable upon maturity, relating to the two extensions respectively.
On February 22, 2022, a short term $3.0 million loan was provided from AWN to Aevitas O Holdings Pty Limited, with interest rate of 10.00% per annum payable on the principal sum upon maturity. Under the historical terms, the loan was due to expire on April 1, 2025 (initially set as May 13, 2022, then extended on June 30, 2022, to October 1, 2023, then extended on January 11, 2023 to April 1, 2025). The requirement for the loan to expire upon completion by VivoPower of a debt or equity raise of at least $25 million was dropped on June 30, 2023. Facility extension fees of $85,000 and $110,000 are payable upon maturity, relating to the two extensions respectively.
On December 22, 2022, a short term $3.0 million loan was provided from AWN to Aevitas O Holdings Pty Limited, with interest rate of BBSY bid floating rate (on average 3.60% for the period from inception to June 30, 2023) plus fixed margin of 15.0% per annum payable on the principal sum upon maturity. A 1% establishment fee of $30,000 was deducted upon initial loan drawdown, and a further 3% exit fee of $90,000 is payable on expiry. Under the historical terms, the loan was due to expire on April 1, 2025 (initially set as October 1, 2023, then extended on January 11, 2023 to April 1, 2025). The requirement for the loan to expire upon completion by VivoPower of a debt or equity raise of at least $25 million was agreed on January 11, 2023, then dropped on June 30, 2023. A facility extension fee of $115,000 is payable upon maturity.
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In February and March 2023, further short term loans of AU$0.5 million and AU$0.25 million were established between AWN and Aevitas O Holdings Pty Limited, drawn down between February and May 2023. The loans have interest rate of BBSY bid floating rate plus fixed margin of 15.0% per annum payable on the principal sum upon maturity, with expiry dates of June 30, 2023. 1% facility establishment fees of total AU$7,500 were deducted upon loan drawdowns, and further 3% exit fees of total AU$22,500 are payable on expiry. On June 30, 2023, the expiry of the loans was amended to August 31, 2023.
Short-term loans with AWN
The short-term facilities described below were originally advanced to Aevitas O Holdings Pty Limited. The Deed of Assignment, Novation and Amendment and Restatement referred to above is a contractual loan document and is distinct from the accounting restatement described in Note 35 to the consolidated financial statements.
The December 2021 loan of AU$1.5 million bears interest at 12.5% per annum, with an expiry date of April 1, 2025 and extension fees of AU$40,000 and AU$60,000. At June 30, 2026, AU$2.45 million was owing, including approximately AU$0.85 million of interest.
The February 22, 2022 loan of $3.0 million bears interest at 10.0% per annum, with an expiry date of April 1, 2025 and extension fees of $85,000 and $110,000. At June 30, 2026, $4.5 million was owing, including approximately $1.3 million of interest.
The December 22, 2022 loan of $3.0 million bears interest at BBSY bid rate plus 15.0%, with an effective rate of 18.75% to 19.82% in the year, an expiry date of April 1, 2025, an extension fee of $115,000 and an exit fee of $90,000. At June 30, 2026, $5.2 million was owing, including approximately $2.0 million of interest.
The February and March 2023 loans of AU$0.5 million and AU$0.25 million bear interest at BBSY plus 15.0%, with an expiry date of October 31, 2025, 1% establishment fees and 3% exit fees. At June 30, 2026, AU$0.83 million and AU$0.42 million were owing.
The July 2023 loans of AU$0.25 million and AU$0.28 million had the same terms as the February and March 2023 loans. At June 30, 2026, AU$0.40 million and AU$0.44 million, respectively, remained outstanding. A further AU$0.28 million was repayable from Kenshaw Solar cash exceeding AU$50,000. Interest on these loans was deferred and payable at expiry, and no interest had been paid as at June 30, 2026.
On July 1, 2026, the deed of company arrangement (DOCA) for KESW SO Pty Ltd (formerly Kenshaw Solar Pty Ltd) was wholly effectuated. As disclosed in Note 33, related-party creditors did not participate in the distribution, and all remaining claims against KESW SO Pty Ltd were extinguished upon effectuation of the DOCA. Accordingly, the outstanding amounts relating to the Kenshaw Solar facilities covered by the DOCA, including any associated deferred interest, were extinguished on July 1, 2026, with no further amount payable in respect of those extinguished obligations.
Total owed to AWN at June 30, 2026 was $46.4 million, comprising principal of $27.3 million and accrued interest and fees of $19.1 million, as described in the detailed shareholder loan disclosures in Note 26 to the consolidated financial statements. The separate $1.4 million related party loan from AGI is not included in these AWN amounts.
The detailed shareholder loan disclosures in Note 26 report FY2026 interest expense, including line and refinancing fees, of $3.2 million, with current principal of $12.8 million and non-current principal of $14.6 million. The stated expiry dates for the short-term loans (April 1 and October 31, 2025) had passed at June 30, 2026. Note 26 states that no overdue-rate interest has been accrued and that Aevitas O Holdings Pty Limited guarantees the obligations to AWN.
As described in Item 5 and Note 33, in July and August 2026, $28.8 million of principal described in the Form 20-F as AWN shareholder debt was retired, comprising $16.5 million exchanged for 165,000 convertible preference shares and $12.3 million repaid in cash. Approximately $16 million of accrued interest was reported as remaining outstanding after those transactions, with settlement options under discussion, including conversion into Class A Ordinary Shares.
Historically, Aevitas issued 4,697 Aevitas Preference Shares of face value A$46,970 to The Panaga Group Trust, of which Mr. Kevin Chin is a beneficiary and one of the directors of the corporate trustee. The historical dividend for the year ended June 30, 2023 is described in Note 32 to the consolidated financial statements.
Chairman’s fees for Kevin Chin in the amount of £68,000 ($87,953) were charged to the Company by Arowana Global Impact Pty Ltd (“AGI”, formerly Arowana Partners Group Pty Ltd) during the year ended June 30, 2025. A further $0.5 million (as of June 30, 2024: $0.4 million) incurred by AGI on behalf of the Company were recharged to the Company during the year ended June 30, 2025. At June 30, 2025, the Company had an account payable of $1.2 million (as of June 30, 2024: $0.7 million) in respect of these services. Mr. Chin was a shareholder and director of AGI during the year ended June 30, 2025.
Historically, Mr. Chin’s CEO remuneration comprised £325,000 base fees and a £38,000 annual professional development allowance. A further $0.5 million incurred by Arowana International UK Limited were recharged to the Company during the year ended June 30, 2025. Of the base salary in FY23, 4 months were paid in cash, while for 8 months, Mr. Chin agreed to receive payment in the form of 541,666 cashless warrants in VivoPower shares, exercisable in the period June 3, 2024 to June 3, 2029 at an exercise price of $0.60. Shares issued following exercising of warrants remain restricted for 12 months. Mr. Chin has allocated these warrants to a benevolent cause, the ASEAN Foundation. At June 30, 2025, the Company had an account payable of $1.3 million in respect of these services and recharges.
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As CEO, Mr. Chin is paid fees through Arowana International UK Limited. For the year ended June 30, 2026, the amount was £363,008 ($469,515), including professional development.
During the year ended June 30, 2026, director fees for Peter Jeavons, William Langdon and Michael Hui were $96,642, $95,750 and $97,835, respectively, including board and committee fees.
Mr. Chin received equity-based remuneration following his appointment as Chief Executive Officer in March 2020. Of the 8,720 ($65,400) annual retention RSUs granted on April 1, 2020, vesting annually from June 2021 to June 2026, 1,744 RSUs ($13,080) vested in 2023. Of the 26,160 ($196,200) performance RSUs vesting quarterly from September 2020 to June 2023, dependent on meeting quarterly performance goals, 3,146 RSUs ($23,592) vested in 2023. In December 2021, the Remuneration Committee approved an equity award of RSUs in relation to short-term incentives for the year ended June 30, 2022, vesting in June 2023 deferred from June 2022. The award vested 9,429 RSUs ($275,330), based on Mr. Chin’s base salary £325,000 x 1.3237 exchange rate x 64% performance measurement / $2.92 VWAP (Volume weighted average price). A further 2,000 annual retention RSUs ($5,200) were granted to Mr. Chin on January 11, 2023, vesting annually from December 2023 to December 2025.
Equity-based remuneration
During the year, the Company granted Kevin Chin 200,000 deferred share units (“DSUs”) with a fair value of $4.20 per DSU. The total award value was $840,000, of which $626,866 was recognized in the year.
Each of the three non-executive directors received 50,000 DSUs with a total award value of $210,000 each, of which $156,716 was recognized in the year. Total DSU expense recognized in the year was $1.1 million, with $0.4 million remaining to be recognized in the year ending June 30, 2027.
The DSUs vested on August 21, 2026. As of the date of this report, the 350,000 VivoPower shares to be issued in settlement of the DSUs have not yet been issued. Certain prior RSUs were converted to DSUs on August 1, 2026 pursuant to the February 26, 2026 board resolution, and the shares in respect of these have also not yet been issued. The supporting FY2026 share-award schedule records 7,430 prior RSUs converted to DSUs on August 1, 2026: 3,078 for Kevin Chin, 1,684 for Michael Hui, 1,334 for Bill Langdon and 1,334 for Peter Jeavons. The corresponding shares had not been issued as recorded in the schedule.
On November 26, 2021, AGI provided a loan of $0.37 million to Caret, to provide working capital assistance. The loan incurred interest during the year of $22,895 at a rate of 8% plus a 2% facility fee, plus a one-off establishment fee of $7,400. The loan plus interest were repaid in August 2022.
In August 2023, the Company received short-term funding from Arowana International UK Limited amounting to £25,000 for working capital purposes which was repaid in September 2023. On October 6, 2023, the Company also received an interest-only loan of $48,000 from Arowana United Enterprises Pte Ltd bearing interest at 8% per annum.
Other Arowana loans
Loan agreements dated June 29, 2024 consolidated earlier financing from Arowana Global Impact Pty Ltd (“AGI”) with an A$1.0 million limit and an expiry date of July 1, 2025, and Arowana International UK Limited with a £1.0 million limit and an expiry date of October 1, 2025.
Terms of the agreements include interest of 12% per annum deferred to expiry, an overdue rate 15% above the applicable rate, a 2% establishment fee deferred to expiry, an obligation to issue 295,000 shares and a negative pledge with no specific security identified.
At June 30, 2026, VivoPower owed $1,177,394 to AGI and $63,537 to Arowana International UK Limited. The $48,000 loan from Arowana United Enterprises Pte Ltd also remained outstanding at June 30, 2026.
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VivoPower Policy on Conflicts of Interest
VivoPower’s Code of Business Conduct and Ethics requires that situations that could be reasonably expected to give rise to a conflict of interest be fully disclosed to the Company’s Compliance Officer and provides that conflicts of interest may only be waived by the Board or an appropriate committee of the Board. Under the Code of Business Conduct and Ethics, a conflict of interest is deemed to occur when an employee’s private interest interferes, or appears to interfere, with the interests of the Company as a whole, and in general the Code of Business Conduct and Ethics provides that, subject to certain exceptions in the Code, the following should be considered conflicts of interest: (i) no employee may be employed or engaged by a business that competes with the Company or deprives it of any business; (ii) no employee should use corporate property, information or his or her position with the Company to secure a business opportunity that would otherwise be available to the Company; (iii) no employee may obtain loans or guarantees of personal obligations from, or enter into any other personal financial transaction with, any company that is a material customer, supplier, financing partner or competitor of the Company. This guideline does not prohibit arms-length transactions with recognized banks or other financial institutions; (iv) no employee may have any financial interest (ownership or otherwise), either directly or indirectly through a spouse or other family member, in any other business or entity if such interest adversely affects the employee’s performance of duties or responsibilities to the Company, or requires the employee to devote time to it during such employee’s working hours at the Company except that with the prior approval of the Board, an employee may hold up to 5% ownership interest in a publicly traded company that is in competition with the Company; provided that if the employee’s ownership interest in such publicly traded company increases to more than 5%, the employee must immediately report such ownership to the Compliance Officer; no employee may hold any ownership interest in a privately held company that is in competition with the Company except with the prior approval of the board; and no employee may hold any ownership interest in a company that has a business relationship with the Company if such employee’s duties at the Company include managing or supervising the Company’s business relations with that company.
The Company’s Audit and Risk Committee, pursuant to its written charter, is responsible for maintaining oversight of conflict of interest transactions to help to ensure that they are appropriately disclosed and make recommendations to the Board regarding authorization. The Audit and Risk Committee considers all relevant factors when determining whether to approve a conflict of interest transaction, including whether the conflict of interest transaction is on terms no less favorable than terms generally available to an unaffiliated third-party under the same or similar circumstances and the extent of the related party’s interest in the transaction. The Company requires each of its directors and executive officers to complete an annual directors’ and officers’ questionnaire that elicits information about conflict of interest transactions.
These procedures are intended to determine whether any such conflict of interest impairs the independence of a director or presents a conflict of interest on the part of a director, employee or officer.
The Company also complies with English law provisions in relation to directors’ conflicts contained in the Companies Act 2006 and specific provisions contained in the Company’s articles of association. The Companies Act 2006 permits directors of U.K. public limited companies to have conflicts of interests provided that their articles of association permit directors to authorize a conflict and the directors do authorize any such conflict in accordance with such provision.
C. Interests of Experts and Counsel
Not applicable.
ITEM 8. FINANCIAL INFORMATION
A. Consolidated Statements and Other Financial Information
See “Item 18-Financial Statements” and the financial statements referred to therein.
Legal Proceedings
The Company is or was involved in the following ongoing legal disputes with suppliers:
| - | BMS Design: Tembo disputes invoices totaling approximately £140,000 raised by BMS Design in connection with a vehicle development project. Tembo contends that the amounts claimed cannot be reconciled to services performed and the matter remains under negotiation. | |
| - | Podium Engineering: In September 2024, Podium Engineering S.r.l. filed an application before the Tribunal of Aosta, Italy (Case No. 708/2024) claiming EUR 192,500 in unpaid fees under an electric vehicle conversion kit development contract. The Tribunal issued a European Order for Payment of EUR 213,049 in November 2024. Tembo filed an opposition in March 2025 and the parties subsequently reached a settlement of EUR 150,000, which has been agreed. The matter is resolved. |
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| - | Hebels: NMW Groep B.V. and J.M. Hebels Holding B.V. (collectively “Hebels”) commenced proceedings against Tembo e-LV B.V. and VivoPower PLC before the Rechtbank Oost-Brabant (Case No. 11589755 CV EXPL 25-1850) in connection with a commercial lease agreement for premises at Marinus van Meelweg 20, Eindhoven, under which VivoPower had provided a joint and several guarantee for Tembo’s obligations. Hebels claimed amounts relating to unpaid rent, vacancy costs, agent fees, and reinstatement costs. On July 2, 2026, the court issued judgment dismissing a significant portion of Hebels’ claims. The total amount awarded and remaining payable, including principal, statutory interest and legal costs, is EUR 44,046. This was paid off post year end. | |
| - | Compliance Quest: ComplianceQuest Inc. filed suit in the U.S. District Court for the Middle District of Florida (Case No. 8:25-cv-01467) claiming US$ 200,891 in unpaid software subscription fees. The matter was settled for US$ 75,000 and the case has been dismissed during the year. | |
| - | Workato settlement. In May 2026, VivoPower International Services Limited (“VISL”) settled a claim from Workato over unpaid software subscription invoices dating from 2022 and 2023. Workato had claimed US$ 75,871.37, including costs and interest. Under the settlement, VISL agreed to pay US$ 42,500 in full and final settlement, in five monthly instalments of US$ 8,500 running from June 18, 2026 to October 19, 2026. The settlement includes a mutual release, contains no admission of liability by either party, and is governed by Jersey law. As of the date of this annual report, all instalments had been paid in accordance with the agreement. | |
| - | Accès Industriel Mining, Inc. asserted claims against VivoPower arising from a dispute concerning the supply and installation of electric vehicle conversion equipment under a distribution agreement entered into in June 2021. In October 2025, the parties entered into a settlement agreement to resolve the dispute without any admission of liability by either party. |
Other legal matters are disclosed below:
| - | In April 2026, VivoPower International Services Limited entered into a payment arrangement with HM Revenue & Customs (HMRC) in respect of outstanding PAYE and VAT liabilities totaling approximately £1.21 million, including interest relating primarily to the COVID period. Under the arrangement, the Company paid £127,555.77 in March 2026 and agreed to make monthly payments of approximately £48,400, commencing in May 2026, with the final scheduled payment due in May 2028, subject to compliance with the agreed terms. | |
| - | In August 2025, the Norwegian Tax Administration (Skatteetaten) notified Arctic Norge Data I AS (formerly Nordland Data AS), before our acquisition of the company, of an audit covering VAT and corporate income tax for the period from January 1, 2022 to February 28, 2025. In December 2025, Skatteetaten extended its review of VAT to 2021. The audit remains ongoing. As of the date of this Annual Report, Skatteetaten has not made any findings or proposed any adjustments, and no assessment has been made and no sanction or monetary claim has been notified to us. |
Dividend Policy
We have not declared or paid any cash dividends on our Class A Ordinary Shares. We currently do not intend to declare or pay cash dividends on our Class A Ordinary Shares in the foreseeable future. Any future determination to declare or pay dividends to holders of our Class A Ordinary Shares will be at the discretion of our Board of Directors and will depend on a number of factors, including our financial condition, results of operations, cash flows, capital requirements, business prospects, liquidity, earnings, applicable legal requirements, restrictions contained in our debt arrangements and other factors that our Board of Directors deems relevant.
As a company incorporated in England and Wales, we may pay dividends only out of distributable profits, as determined by reference to our relevant accounts under Part 23 of the Companies Act 2006. At June 30, 2026, VivoPower PLC, the parent company, had an accumulated deficit and did not have distributable profits. Accordingly, we would be unable to declare or pay a dividend on our Class A Ordinary Shares, whether in cash or in shares, until we have generated sufficient distributable profits. A dividend paid in breach of these requirements would be unlawful, and recipients who knew or had reasonable grounds to know of the breach could be required to repay it.
Our convertible preference shares carry a cumulative dividend of 6% per annum, which is payable in kind and is not paid in cash.
We have previously announced potential special dividend and in specie distribution arrangements in connection with the proposed separation of certain of our non-core businesses, including Tembo e-LV B.V. (“Tembo”) and Caret. On July 6, 2026, we announced that those previously contemplated special dividend and related distribution arrangements had been discontinued. In respect of Tembo, the previously contemplated special dividend and related record date arrangements were discontinued and superseded by the arrangements contemplated under the amended Business Combination Agreement and the related registration statement on Form F-4. In respect of Caret, the previously contemplated special dividend and related in specie distribution arrangements were discontinued and superseded by a proposed separation pursuant to which, subject to applicable conditions and approvals, the entire issued share capital of Caret held by the VivoPower group would be distributed in specie to our shareholders on a pro rata basis.
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The proposed separation of Caret remains subject to, among other things, final approval by our Board of Directors of the definitive terms, receipt of all necessary regulatory, stock exchange and, if and to the extent required, shareholder approvals, execution of definitive transaction documentation, effectiveness of any required registration, listing or other arrangements, prevailing market conditions and the satisfaction of customary conditions. Accordingly, there can be no assurance as to the final structure, form, timing or other terms of the proposed separation, or whether or when it will be implemented.
Except for any distribution that may be made in connection with the proposed separation of Caret, we do not currently anticipate making any distributions to our shareholders in the foreseeable future.
B. Significant Changes
Except as disclosed elsewhere in this Annual Report, there have been no significant changes since June 30, 2026. For subsequent events, please refer to Note 33 of the financial statements.
ITEM 9. THE OFFER AND LISTING
A. Offering and Listing Details
The principal host market for the Class A Ordinary Shares of VivoPower is The Nasdaq Capital Market and the shares are traded under the symbol “VIVO.”
B. Plan of Distribution
Not applicable.
C. Markets
Since December 29, 2016, our Class A Ordinary Shares have been listed on The Nasdaq Capital Market under the symbol “VVPR”. We changed our trading symbol from “VVPR” to “VIVO” effective March 16, 2026.
D. Selling Shareholders
Not applicable.
E. Dilution
Not applicable.
F. Expenses of the Issue
Not applicable.
ITEM 10. ADDITIONAL INFORMATION
A. Share Capital
Not applicable.
B. Memorandum and Articles of Association
The description of our share capital and Articles of Association, as amended on January 30, 2026, is set forth in Exhibit 2.1 (Description of Securities) to this Annual Report and is incorporated herein by reference. The description in Exhibit 2.1 replaces the description previously incorporated by reference from our registration statement on Form F-4 filed with the SEC on August 24, 2016, which no longer reflects our share capital. Our current Articles of Association are filed as Exhibit 1.1 to this Annual Report.
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C. Material Contracts
See “Item 4.B. Business Overview,” “Item 5.B. Liquidity and Capital Resources”, “Item 6. Directors, Senior Management and Employees” and “Item 7.B. Related Party Transactions.”
The following material contracts, which were outside of the ordinary course of business, were entered into during the year ended June 30, 2026 (including the exhibits thereto).
| ● | F-1 offering: In July and August 2025, VivoPower issued 2,044,749 Class A Ordinary Shares at US$6.05 per share under its Form F-1, for gross proceeds of approximately US$12.37 million (approximately US$11.30 million net). | |
| ● | Regulation S: In September and October 2025, VivoPower issued 400,000 and 50,000 Class A Ordinary Shares at US$4.24 per share, for proceeds of US$1.696 million and US$212,000, respectively. In May 2026, VivoPower issued 615,714 Class A Ordinary Shares for proceeds of US$2,154,999. | |
| ● | Aevitas preference shares (non-cash): In April 2026, the Board approved the issuance of 41,507 CPS at US$100 per share (US$4,150,700) to a nominated third-party investor. These CPS formed part of PIPE 1. The consideration comprised the investor’s acquisition of up to 426,568 Aevitas Preference Shares (A$4,265,680) and assumption of A$1,580,322 of unpaid dividends. Upon completion, the instrument and related dividend liability will be derecognized. | |
| ● | PIPE 1: Between January and April 2026, VivoPower issued 255,000 Series 1 Convertible Preference Shares (CPS 1) at US$100 per share, for proceeds of US$25.5 million. The shares were subscribed for by a number of private institutional investors and family offices. Including the Aevitas CPS, the total raise was approximately US$29.7 million. | |
| ● | TAG INTL DMCC: VivoPower received US$8.5 million in loans from TAG INTL DMCC in January and February 2026. Separately, Tembo received US$921,965 as a part-payment under its advance subscription agreement with TAG. | |
| ● | On May 12, 2026, VivoPower completed its acquisition of the Norwegian data center business from Cowa for a consideration of US$37.7 million. The consideration comprised US$20.5 million in cash on closing, deferred cash of US$10.25 million payable in two instalments (US$5 million within 6 months and US$5.25 million within 12 months of closing), and US$10.25 million in Class A Ordinary Shares being 1,507,353 shares issued at US$6.80 per share, together with contingent warrants over 1,055,147 Class A Ordinary Shares at an exercise price of US$0.001 per share. The warrants were exercised on a cashless basis on June 17, 2026 for 1,054,963 Class A Ordinary Shares. The deferred cash consideration of US$10.25 million remained payable at June 30, 2026. |
D. Exchange Controls
Other than applicable taxation, anti-money laundering and counter-terrorist financing law and regulation and certain economic sanctions which may be in force from time to time, there are no English laws or regulation, or any provision of our articles of association, which would prevent the import or export of capital or the remittance of dividends, interest or other payments by us to holders of our Class A Ordinary Shares who are not residents of the U.K. on a general basis.
E. Taxation
U.K. Tax Considerations
The following statements are a general guide to certain aspects of current U.K. tax law and the current published practice of HM Revenue and Customs, both of which are subject to change, possibly with retrospective effect.
The following statements are intended to apply to holders of Class A Ordinary Shares who are only resident for tax purposes in the U.K., who hold the Class A Ordinary Shares as investments and who are the beneficial owners of the Class A Ordinary Shares. The statements may not apply to certain classes of holders of Class A Ordinary Shares, such as dealers in securities and persons acquiring Class A Ordinary Shares in connection with their employment. Prospective investors in Class A Ordinary Shares who are in any doubt as to their tax position regarding the acquisition, ownership and disposition of the Class A Ordinary Shares should consult their own tax advisers.
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Dividends
Withholding tax
We will not be required to deduct or withhold U.K. tax at source from dividend payments we make.
Individuals
Dividends received by an individual shareholder who is resident in the U.K. for tax purposes are subject to U.K. income tax. For the 2026/2027 tax year, the first £500 of dividend income in the tax year is taxed at a nil rate (the “dividend allowance”). Dividend income in excess of the dividend allowance is taxed at 10.75% to the extent it falls within the basic rate band, 35.75% to the extent it falls within the higher rate band and 39.35% to the extent it falls within the additional rate band. Dividend income that falls within the dividend allowance counts towards the individual’s basic or higher rate band, and so may affect the rate of tax payable on dividend income above the allowance. Whether dividend income falls in the basic, higher or additional rate band depends on the individual’s total taxable income for the tax year.
Corporate shareholders within the charge to U.K. corporation tax
Holders of Class A Ordinary Shares within the charge to U.K. corporation tax which are “small companies” for the purposes of Chapter 2 of Part 9A of the Corporation Tax Act 2009 (for the purposes of U.K. taxation of dividends) will not be subject to U.K. corporation tax on any dividend received from us provided certain conditions are met (including an anti-avoidance condition).
Other holders within the charge to U.K. corporation tax will not normally be subject to tax on dividends from us, provided that one of a number of possible exemptions applies.
If the conditions for exemption are not met or cease to be satisfied, or such a holder elects for an otherwise exempt dividend to be taxable, the holder will be subject to U.K. corporation tax on dividends received from us, at the applicable rate of U.K. corporation tax (25% for companies with profits in excess of £250,000, 19% for companies with profits below £50,000, and marginal relief for companies with profits between £50,000 and £250,000).
Capital gains
Individuals
For individual holders who are resident in the U.K. and individual holders who are temporarily non-resident and subsequently resume residence in the U.K. within a certain time, the principal factors that will determine the U.K. capital gains tax position on a disposal or deemed disposal of Class A Ordinary Shares are the extent to which the holder realizes any other capital gains in the U.K. tax year in which the disposal is made, the extent to which the holder has incurred unrelieved capital losses in that or earlier U.K. tax years, and the level of the annual allowance of tax-free gains in that U.K. tax year (the “annual exemption”). The current annual exemption for the 2026/2027 tax year is £3,000 for individuals and personal representatives, and £1,500 for most trustees.
Subject to any reliefs that may be available, an individual holder will be subject to capital gains tax on any gain above the annual exemption amount at a rate of 18% or 24% depending on the total amount of the individual’s taxable income in the same tax year as the disposal takes place.
Companies
A disposal or deemed disposal of Class A Ordinary Shares by a holder within the charge to U.K. corporation tax may give rise to a chargeable gain or allowable loss for the purposes of U.K. corporation tax, depending on the circumstances and subject to any exemptions or reliefs that apply or may be available. U.K. corporation tax is charged on chargeable gains at the current main rate of 25% for companies with profits exceeding £250,000, and a lower rate of 19% for companies with profits up to £50,000. Marginal relief applies to companies with profits between these amounts, providing a gradual increase in the corporation tax rate from 19% to 25%. Holders within the charge to U.K. corporation tax will, for the purposes of computing chargeable gains, be allowed to claim an indexation allowance which applies to reduce capital gains (but not to create or increase an allowable loss) to the extent that such gains arise due to inflation although the allowance has now been frozen and now only applies to assets acquired prior to 31 December 2017.
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Stamp Duty and Stamp Duty Reserve Tax (“SDRT”)
The statements in this section entitled “Stamp Duty and Stamp Duty Reserve Tax (“SDRT”) are intended as a general guide to the current United Kingdom stamp duty and SDRT position. The discussion below relates to holders wherever resident, but investors should note that certain categories of person are not liable to stamp duty or SDRT and others may be liable at a higher rate or may, although not primarily liable for tax, be required to notify and account for SDRT under the Stamp Duty Reserve Tax Regulations 1986.
General
Except in relation to depositary receipt systems and clearance services (to which the special rules outlined below apply):
| ● | No stamp duty or SDRT will arise on the issue of our shares; | |
| ● | An agreement to transfer our shares will normally give rise to a charge to SDRT at the rate of 0.5% of the amount or value of the consideration payable for the transfer. SDRT is, in general, payable by the purchaser; | |
| ● | Instruments transferring our shares will generally be subject to stamp duty at the rate of 0.5% of the consideration given for the transfer (rounded up to the next £5). The purchaser normally pays the stamp duty; and, | |
| ● | If a duly stamped transfer completing an agreement to transfer is produced within six years of the date on which the agreement is made (or, if the agreement is conditional, the date on which the agreement becomes unconditional), any SDRT already paid is generally repayable, normally with interest, and any SDRT charge yet to be paid is cancelled. |
Depositary Receipt Systems and Clearance Services
U.K. domestic law provides that where our Class A Ordinary Shares are issued or transferred to a depositary receipt system or clearance service (or their nominees or agents) SDRT (in the case of an issue of shares) and stamp duty or SDRT (in the case of a transfer of shares) may be payable, broadly at the higher rate of 1.5% of the amount or value of the consideration given (or, in certain circumstances, the value of the shares) (rounded up to the nearest £5 in the case of stamp duty). Generally, transfers within such depositary receipt system or clearance service are thereafter not subject to stamp duty or SDRT, provided that (in the case of a clearance service) no election under section 97A of the Finance Act 1986 has been made (as to which, see further below).
However, following the European Court of Justice decision in C-569/07 HSBC Holdings PLC, Vidacos Nominees Limited v. The Commissioners of Her Majesty’s Revenue & Customs and the First-tier Tax Tribunal decision in HSBC Holdings Plc and The Bank of New York Mellon Corporation v. The Commissioners of Her Majesty’s Revenue & Customs (“HMRC”), HMRC has confirmed that a charge to 1.5% SDRT is no longer payable when new shares are issued to a depositary receipt system or clearance service (such as, in our understanding, The Depository Trust Company (“DTC”)).
HMRC remains of the view that where our shares are transferred (a) to, or to a nominee or an agent for, a person whose business is or includes the provision of clearance services or (b) to, or to a nominee or an agent for, a person whose business is or includes issuing depositary receipts, stamp duty or SDRT will generally be payable at the higher rate of 1.5% of the amount or value of the consideration given or, in certain circumstances, the value of our shares.
There is an exception from the 1.5% charge on the transfer to, or to a nominee or agent for, a clearance service where the clearance service has made and maintained an election under section 97A(1) of the Finance Act 1986 which has been approved by HMRC. In these circumstances, SDRT at the rate of 0.5% of the amount or value of the consideration payable for the transfer will arise on any transfer of our shares into such a clearance service and on subsequent agreements to transfer such shares within such clearance service. It is our understanding that DTC has not made an election under section 97A(1) of the Finance Act of 1986, and that therefore transfers or agreements to transfer shares held in book entry (i.e., electronic) form within the facilities of DTC should not be subject to U.K. stamp duty or SDRT.
Any liability for stamp duty or SDRT in respect of a transfer into a clearance service or depositary receipt system, or in respect of a transfer within such a service, which does arise will strictly be accountable by the clearance service or depositary receipt system operator or their nominee, as the case may be, but will, in practice, be payable by the participants in the clearance service or depositary receipt system.
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Norwegian Tax Considerations
The following statements are a general guide to certain aspects of current Norwegian tax law and published practice, both of which are subject to change, possibly with retrospective effect. They do not constitute tax advice. Holders of Class A Ordinary Shares should consult their own tax advisers regarding the tax consequences applicable to their particular circumstances.
During FY2026, the Group acquired VivoPower Norge Infrastructure AS (fka Cromwell AS) on May 12, 2026. VivoPower Norge Infrastructure AS is resident in Norway for tax purposes. The acquisition does not change the issuer of the Class A Ordinary Shares, which remains VivoPower PLC, and dividends on the Class A Ordinary Shares continue to be paid by the U.K. parent.
Holders of Class A Ordinary Shares are not, solely because of this acquisition, subject to Norwegian withholding tax on dividends paid by VivoPower PLC, and a disposal of Class A Ordinary Shares does not, solely for that reason, constitute a disposal of a Norwegian asset.
Norwegian tax may arise for a holder only in circumstances specific to that holder, for example where the holder is resident in Norway for tax purposes or carries on business in Norway through a permanent establishment to which the Class A Ordinary Shares are attributable.
At the company level, Norwegian corporation tax is levied at a rate of 22 percent. Dividends paid by Cromwell AS to its non-Norwegian parent may be subject to Norwegian withholding tax, generally at a rate of 25 percent, subject to any applicable exemption or relief under a tax treaty, including the U.K.–Norway tax treaty. These are tax consequences for the Group arising from the acquisition and do not constitute Norwegian taxes imposed on holders of Class A Ordinary Shares.
Certain Material U.S. Federal Income Tax Considerations
The following is a summary of certain material U.S. federal income tax considerations relating to the acquisition, ownership, and disposition of our Class A Ordinary Shares by a U.S. holder (as defined below). This summary addresses only the U.S. federal income tax considerations for U.S. holders that hold such Class A Ordinary Shares as capital assets. This summary does not address all U.S. federal income tax matters that may be relevant to a particular U.S. holder. This summary does not address tax considerations applicable to a holder of Class A Ordinary Shares that may be subject to special tax rules including, without limitation, the following:
| ● | banks, financial institutions or insurance companies; | |
| ● | brokers, dealers or traders in securities, currencies, commodities, or notional principal contracts; | |
| ● | tax-exempt entities or organizations, including an “individual retirement account” or “Roth IRA” as defined in Section 408 or 408A of the Code (as defined below), respectively; | |
| ● | real estate investment trusts, regulated investment companies or grantor trusts; | |
| ● | persons that hold the Class A Ordinary Shares as part of a “hedging,” “integrated” or “conversion” transaction or as a position in a “straddle” for U.S. federal income tax purposes; | |
| ● | partnerships (including entities classified as partnerships for U.S. federal income tax purposes) or other pass-through entities, or persons that will hold our shares through such an entity; | |
| ● | S corporations; | |
| ● | certain former citizens or long-term residents of the United States; | |
| ● | persons that received our shares as compensation for the performance of services; |
| ● | holders that own directly, indirectly, or through attribution 10% or more of the voting power or value of our shares; and | |
| ● | holders that have a “functional currency” other than the U.S. dollar. |
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Further, this summary does not address the U.S. federal estate, gift, or alternative minimum tax considerations, or any U.S. state, local, or non-U.S. tax considerations of the acquisition, ownership, and disposition of our Class A Ordinary Shares.
This description is based on the U.S. Internal Revenue Code of 1986, as amended, or the Code, existing, proposed and temporary U.S. Treasury Regulations promulgated thereunder and administrative and judicial interpretations thereof; and the income tax treaty between the U.S. and the U.K., in each case as in effect and available on the date hereof. All the foregoing is subject to change, which change could apply retroactively, and to differing interpretations, all of which could affect the tax considerations described below. There can be no assurances that the U.S. Internal Revenue Service, or the IRS, will not take a contrary or different position concerning the tax consequences of the acquisition, ownership, and disposition of our Class A Ordinary Shares or that such a position would not be sustained.
For the purposes of this summary, a “U.S. holder” is a beneficial owner of Class A Ordinary Shares that is (or is treated as), for U.S. federal income tax purposes:
| ● | an individual who is a citizen or resident of the United States; | |
| ● | a corporation, or other entity that is treated as a corporation for U.S. federal income tax purposes, created or organized in or under the laws of the United States, any state thereof, or the District of Columbia; | |
| ● | an estate, the income of which is subject to U.S. federal income taxation regardless of its source; or, | |
| ● | a trust, if a court within the United States is able to exercise primary supervision over its administration and one or more U.S. persons have the authority to control all of the substantial decisions of such trust or has a valid election in effect under applicable U.S. Treasury Regulations to be treated as a United States person. |
If a partnership (or any other entity treated as a partnership for U.S. federal income tax purposes) holds Class A Ordinary Shares, the U.S. federal income tax consequences relating to an investment in our Class A Ordinary Shares will depend in part upon the status of the partner and the activities of the partnership. Such a partner or partnership should consult its tax advisor regarding the U.S. federal income tax considerations of acquiring, owning and disposing of our Class A Ordinary Shares in its particular circumstances.
As indicated below, this discussion is subject to U.S. federal income tax rules applicable to a “passive foreign investment company,” or a PFIC.
The following summary is of a general nature only and is not a substitute for careful tax planning and advice. Persons considering an investment in our Class A Ordinary Shares should consult their own tax advisors as to the particular tax consequences applicable to them relating to the acquisition, ownership and disposition of our Class A Ordinary Shares, including the applicability of U.S. federal, state and local tax laws and non-U.S. tax laws.
THIS DISCUSSION IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT TAX ADVICE. INVESTORS SHOULD CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE APPLICATION OF THE U.S. FEDERAL INCOME TAX LAWS TO THEIR PARTICULAR SITUATIONS AS WELL AS ANY TAX CONSEQUENCES OF THE PURCHASE, OWNERSHIP, AND DISPOSITION OF OUR CLASS A ORDINARY SHARES ARISING UNDER THE U.S. FEDERAL ESTATE OR GIFT TAX LAWS OR UNDER THE LAWS OF ANY STATE, LOCAL, OR NON-U.S. TAXING JURISDICTION OR UNDER ANY APPLICABLE INCOME TAX TREATY.
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Distributions
Subject to the discussion under “Passive Foreign Investment Company Considerations,” below, the gross amount of any distribution actually or constructively received by a U.S. holder with respect to Class A Ordinary Shares will be taxable to the U.S. holder as a dividend to the extent of the U.S. holder’s pro rata share of our current and accumulated earnings and profits as determined under U.S. federal income tax principles. Distributions in excess of earnings and profits will be non-taxable to the U.S. holder to the extent of, and will be applied against and reduce, the U.S. holder’s adjusted tax basis in the Class A Ordinary Shares. Distributions in excess of earnings and profits and such adjusted tax basis will generally be taxable to the U.S. holder as either long-term or short-term capital gain depending upon whether the U.S. holder has held our Class A Ordinary Shares for more than one year as of the time such distribution is received. However, since we do not calculate our earnings and profits under U.S. federal income tax principles, it is expected that any distribution will be reported as a dividend, even if that distribution would otherwise be treated as a non-taxable return of capital or as capital gain under the rules described above. With respect to non-corporate U.S. holders, dividends generally will be taxed at the lower applicable long-term capital gains rate if our Class A Ordinary Shares are readily tradable on an established securities market in the U.S. or we are eligible for benefits of the income tax treaty between the U.S. and the U.K. and certain other requirements are met. In addition, if we are classified as a PFIC in a taxable year in which a dividend is paid or the prior year, this lower tax rate will not be available. U.S. holders should consult their tax advisors regarding the availability of such lower rate for any dividends paid with respect to our Class A Ordinary Shares.
In general, the amount of a distribution paid to a U.S. holder in a foreign currency will be the dollar value of the foreign currency calculated by reference to the spot exchange rate on the day the U.S. holder receives the distribution, regardless of whether the foreign currency is converted into U.S. dollars at that time. Any foreign currency gain or loss a U.S. holder realizes on a subsequent conversion of foreign currency into U.S. dollars will be U.S. source ordinary income or loss. If dividends received in a foreign currency are converted into U.S. dollars on the day they are received, a U.S. holder should not be required to recognize foreign currency gain or loss in respect of the dividend.
Sale, Exchange or Other Taxable Disposition of Our Class A Ordinary Shares
Subject to the discussion below under “Passive Foreign Investment Company Considerations,” a U.S. holder will generally recognize gain or loss for U.S. federal income tax purposes upon the sale, exchange or other taxable disposition of Class A Ordinary Shares in an amount equal to the difference between the U.S. dollar value of the amount realized from such sale or exchange and the U.S. holder’s tax basis for those Class A Ordinary Shares. Subject to the discussion under “Passive Foreign Investment Company Considerations” below, this gain or loss will generally be a capital gain or loss and will generally be treated as from sources within the United States. The adjusted tax basis in an ordinary share generally will be equal to the cost of such ordinary share. Capital gain from the sale, exchange or other taxable disposition of Class A Ordinary Shares of a non-corporate U.S. holder is generally eligible for a preferential rate of taxation applicable to capital gains, if the non-corporate U.S. holder’s holding period determined at the time of such sale, exchange or other taxable disposition for such Class A Ordinary Shares exceeds one year (i.e., such gain is long-term taxable gain). The deductibility of capital losses for U.S. federal income tax purposes is subject to limitations under the Code. Any such gain or loss that a U.S. holder recognizes generally will be treated as U.S. source income or loss for foreign tax credit limitation purposes.
Medicare Tax. Certain U.S. holders that are individuals, estates or trusts are subject to a 3.8% tax on all or a portion of their “net investment income,” which may include all or a portion of their dividend income and net gains from the disposition of Class A Ordinary Shares. Each U.S. holder that is an individual, estate or trust is urged to consult its tax advisors regarding the applicability of the Medicare tax to its income and gains in respect of its investment in our Class A Ordinary Shares.
Passive Foreign Investment Company Considerations
If we are classified as a passive foreign investment company, or PFIC, in any taxable year, a U.S. holder would be subject to special rules generally intended to reduce or eliminate any benefits from the deferral of U.S. federal income tax that a U.S. holder could derive from investing in a non-U.S. company that does not distribute all of its earnings on a current basis.
A corporation organized outside the United States generally will be classified as a PFIC for U.S. federal income tax purposes in any taxable year in which, after applying certain look-through rules with respect to the income and assets of its subsidiaries, either: (i) at least 75% of its gross income is “passive income” or (ii) at least 50% of the average quarterly value of its total gross assets (which, assuming we are not a Controlled Foreign Company (“CFC”) for the year being tested, would be measured by fair market value of the assets, and for which purpose the total value of our assets may be determined in part by the market value of our Class A Ordinary Shares, which is subject to change) is attributable to assets that produce “passive income” or are held for the production of “passive income.”
Passive income for this purpose generally includes dividends, interest, royalties, rents, gains from commodities and securities transactions and the excess of gains over losses from the disposition of assets which produce passive income, and also includes amounts derived by reason of the temporary investment of funds raised in offerings of our Class A Ordinary Shares. If a non-U.S. corporation owns directly or indirectly at least 25% by value of the stock of another corporation, the non-U.S. corporation is treated for purposes of the PFIC tests as owning its proportionate share of the assets of the other corporation and as receiving directly its proportionate share of the other corporation’s income for the purposes of the PFIC tests. If we are classified as a PFIC in any year with respect to which a U.S. holder owns our Class A Ordinary Shares, we will continue to be treated as a PFIC with respect to such U.S. holder in all succeeding years during which the U.S. holder owns our Class A Ordinary Shares, regardless of whether we continue to meet the tests described above, unless (i) we cease to be a PFIC and (ii) the U.S. holder makes a “deemed sale” election under PFIC rules.
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We believe that we were not a PFIC during our 2026 taxable year and do not expect to be a PFIC during our 2027 taxable year. Our status for any taxable year will depend on the composition of our income and the projected composition and estimated fair market values of our assets and activities in each year, and because this is a factual determination made annually after the end of each taxable year, there can be no assurance that we will not be considered a PFIC for the current taxable year or any future taxable year. The market value of our assets may be determined in large part by reference to the market price of our Class A Ordinary Shares, which are likely to fluctuate. Further, even if we determine that we are not a PFIC after the close of our taxable year, there can be no assurances that the IRS will agree with our conclusion.
If we are a PFIC, for any taxable year, then unless a U.S. holder makes one of the elections described below, a special tax regime will apply to both (a) any “excess distribution” by us to such U.S. holder (generally, the U.S. holder’s ratable portion of distributions in any year which are greater than 125% of the average annual distribution received by the U.S. holder in the shorter of the three preceding years or the U.S. holder’s holding period for our Class A Ordinary Shares) and (b) any gain realized on the sale or other disposition of the Class A Ordinary Shares. Under this regime, any excess distribution and realized gain will be treated as ordinary income and will be subject to tax as if (a) the excess distribution or gain had been realized ratably over the U.S. holder’s holding period, (b) the amount deemed realized in each year had been subject to tax in each year of that holding period at the highest marginal rate for such year (other than income allocated to the current period or any taxable period before we became a PFIC, which would be subject to tax at the U.S. holder’s regular ordinary income rate for the current year and would not be subject to the interest charge discussed below), and (c) the interest charge generally applicable to underpayments of tax had been imposed on the taxes deemed to have been payable in those years. In addition, dividend distributions made to the U.S. holder will not qualify for the lower rates of taxation applicable to long-term capital gains discussed above under “Distributions.”
Certain elections exist that may alleviate some of the adverse consequences of PFIC status and would result in an alternative treatment (such as mark-to-market treatment) of our Class A Ordinary Shares. If a U.S. holder makes the mark-to-market election, the U.S. holder generally will recognize as ordinary income any excess of the fair market value of the Class A Ordinary Shares at the end of each taxable year over their adjusted tax basis, and will recognize an ordinary loss in respect of any excess of the adjusted tax basis of the Class A Ordinary Shares over their fair market value at the end of the taxable year (but only to the extent of the net amount of income previously included as a result of the mark-to-market election). If a U.S. holder makes the election, the U.S. holder’s tax basis in the Class A Ordinary Shares will be adjusted to reflect these income or loss amounts. Any gain recognized on the sale or other disposition of Class A Ordinary Shares in a year when we are a PFIC will be treated as ordinary income and any loss will be treated as an ordinary loss (but only to the extent of the net amount of income previously included as a result of the mark-to-market election). The mark-to-market election is available only if we are a PFIC and our Class A Ordinary Shares are “regularly traded” on a “qualified exchange.” Our Class A Ordinary Shares will be treated as “regularly traded” in any calendar year in which more than a de minimis quantity of the Class A Ordinary Shares are traded on a qualified exchange on at least 15 days during each calendar quarter (subject to the rule that trades that have as one of their principal purposes the meeting of the trading requirement are disregarded). The Nasdaq Capital Market is a qualified exchange for this purpose and, consequently, if the Class A Ordinary Shares are regularly traded, the mark-to-market election will be available to a U.S. holder.
If we are a PFIC for any year during which a U.S. holder holds our Class A Ordinary Shares, we must generally continue to be treated as a PFIC by that U.S. holder for all succeeding years during which the U.S. holder holds our Class A Ordinary Shares, unless we cease to meet the requirements for PFIC status and the U.S. holder makes a “deemed sale” election with respect to our Class A Ordinary Shares. If such election is made, the U.S. holder will be deemed to have sold our Class A Ordinary Shares it holds at their fair market value on the last day of the last taxable year in which we qualified as a PFIC, and any gain from such deemed sale would be subject to the consequences applicable to sales of PFIC shares described above. After the deemed sale election, the U.S. holder’s Class A Ordinary Shares with respect to which the deemed sale election was made will not be treated as shares in a PFIC unless we subsequently become a PFIC.
The tax consequences that would apply if we were a PFIC would also be different from those described above if a U.S. holder were able to make a valid “qualified electing fund,” or QEF, election. However, we do not currently intend to provide the information necessary for U.S. holders to make a QEF election if we were treated as a PFIC for any taxable year and prospective investors should assume that a QEF election will not be available. U.S. holders should consult their tax advisors to determine whether any of these elections would be available and if so, what the consequences of the alternative treatments would be in their particular circumstances.
If we are determined to be a PFIC, the general tax treatment for U.S. holders described in this section would apply to indirect distributions and gains deemed to be realized by U.S. holders in respect of any of our subsidiaries that also may be determined to be PFICs.
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If a U.S. holder owns Class A Ordinary Shares during any taxable year in which we are a PFIC and the U.S. holder recognizes gain on a disposition of our Class A Ordinary Shares, receives distributions with respect to our Class A Ordinary Shares, or has made a mark-to-market election with respect to our Class A Ordinary Shares the U.S. holder generally will be required to file an IRS Form 8621 (Information Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund) with respect to the company, generally with the U.S. holder’s federal income tax return for that year. In addition, in general, a U.S. person who is shareholder of a PFIC is required to file an IRS Form 8621 annually to report information regarding such person’s PFIC shares if on the last day of the shareholder’s taxable year the aggregate value of all stock owned directly or indirectly by the shareholder exceeds $25,000 ($50,000 for joint filers), or for stock owned indirectly through another PFIC exceeds $5,000. If a U.S. person holds an interest in a domestic partnership (or a domestic entity or arrangement treated as a partnership for U.S. federal income tax purposes) or an S corporation that owns interest in a PFIC, as long as the partnership or S corporation itself has filed the form and has made a qualified electing fund or mark-to-market election, the members of the partnership aren’t required to file the IRS Form 8621. If our company were a PFIC for a given taxable year, then U.S. holders should consult their tax advisor concerning their annual filing requirements.
The U.S. federal income tax rules relating to PFICs are complex. Prospective U.S. holders are urged to consult their own tax advisers with respect to the acquisition, ownership and disposition of our Class A Ordinary Shares, the consequences to them of an investment in a PFIC, any elections available with respect to our Class A Ordinary Shares and the IRS information reporting obligations with respect to the acquisition, ownership and disposition of our ordinary share.
Backup Withholding and Information Reporting
U.S. holders generally will be subject to information reporting requirements with respect to dividends on Class A Ordinary Shares and on the proceeds from the sale, exchange or disposition of Class A Ordinary Shares that are paid within the United States or through U.S.-related financial intermediaries, unless the U.S. holder is an “exempt recipient.” In addition, U.S. holders may be subject to backup withholding on such payments, unless the U.S. holder provides a correct taxpayer identification number and a duly executed IRS Form W-9 or otherwise establishes an exemption. Backup withholding is not an additional tax, and the amount of any backup withholding will be allowed as a credit against a U.S. holder’s U.S. federal income tax liability and may entitle such holder to a refund, provided that the required information is timely furnished to the IRS.
Certain Reporting Requirements with Respect to Payments of Offer Price
U.S. holders paying more than $100,000 for our Class A Ordinary Shares generally may be required to file IRS Form 926 reporting the payment of the offer price for our Class A Ordinary Shares to us. Substantial penalties may be imposed upon a U.S. holder that fails to comply. Each U.S. holder should consult its own tax advisor as to the possible obligation to file IRS Form 926.
Foreign Financial Asset Reporting
Furthermore, certain U.S. holders who are individuals and certain entities will be required to report information with respect to such U.S. holder’s investment in “specified foreign financial assets” on IRS Form 8938, subject to certain exceptions. Specified foreign financial assets generally include any financial account maintained with a non-U.S. financial institution and should also include our Class A Ordinary Shares if they are not held in an account maintained with a U.S. financial institution. Persons who are required to report specified foreign financial assets and fail to do so may be subject to substantial penalties, and the period of limitations on assessment and collection of U.S. federal income taxes may be extended in the event of a failure to comply. U.S. holders are urged to consult their own tax advisors regarding the foreign financial asset and other reporting obligations and their application to an investment in our Class A Ordinary Shares.
THE DISCUSSION ABOVE IS A GENERAL SUMMARY. IT DOES NOT COVER ALL TAX MATTERS THAT MAY BE OF IMPORTANCE TO A PROSPECTIVE INVESTOR. EACH PROSPECTIVE INVESTOR IS URGED TO CONSULT ITS OWN TAX ADVISOR ABOUT THE TAX CONSEQUENCES TO IT OF AN INVESTMENT IN CLASS A ORDINARY SHARES IN LIGHT OF THE INVESTOR’S OWN CIRCUMSTANCES.
F. Dividends and Paying Agents
Not applicable.
G. Statements by Experts
Not applicable.
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H. Documents on Display
Any statement in this Annual Report about any of our contracts or other documents is not necessarily complete. If the contract or document is filed as an exhibit to the Annual Report, the contract or document is deemed to modify the description contained in this Annual Report. You must review the exhibits themselves for a complete description of the contract or document.
We are subject to the reporting requirements of foreign private issuers under the Exchange Act. As a foreign private issuer, we are exempt from the rules under the Exchange Act prescribing the form and content of proxy statements and our principal shareholders are exempt from Section 16 of the Exchange Act, and our directors and officers, although subject to the reporting requirements of Section 16(a) since March 18, 2026, are exempt from the short swing profit recovery provisions of Section 16(b). Pursuant to the Exchange Act, we file reports with the SEC, including this Annual Report. We also submit reports to the SEC, including Form 6-K Reports of Foreign Private Issuers. You may read and copy such reports at the SEC’s Public Reference Room at 100 F Street, N.E., Room 1580, Washington, D.C. 20549. You may call the SEC at 1-800-SEC-0330 for further information about the Public Reference Room. Such reports are also available to the public on the SEC’s website at www.sec.gov. Some of this information may also be found on our website at www.vivopower.com.
You may request copies of our reports, at no cost, by writing, emailing, or telephoning us as follows:
VivoPower PLC
Attention: Syed Muhammad Nouman
Suite 4, 7th Floor, 50 Broadway,
London SW1H 0DB
United Kingdom
Email: shareholders@vivopower.com
Telephone: +44-203-667-5158
I. Subsidiary Information
Not applicable.
ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Market risk represents the risk of loss that may impact our financial position due to adverse changes in financial market prices and rates. Our market risk exposure is primarily a result of fluctuations in foreign currency rates, although we also have some exposure due to potential changes in inflation or interest rates. We do not hold financial instruments for trading purposes.
Foreign Exchange Risk
The Group operates across the United Kingdom, United States, Australia, the Netherlands, Norway, Philippines and the United Arab Emirates and is exposed to movements between the US dollar, Norwegian krone, Pound Sterling, Euro and Australian dollar. Delivery of the Group’s strategy also depends on attracting and retaining suitably qualified technical, commercial and finance personnel.
The Group operates internationally and is exposed to foreign exchange risk on sales and purchases that are denominated in currencies other than the respective functional currencies of the Group entities to which they relate, primarily between USD, AUD, EUR, NOK and GBP.
The Group’s investments in overseas subsidiaries are not hedged as those currency positions are either USD denominated and/or considered to be long-term in nature.
The Group is exposed to foreign exchange risk on the following balances at June 30, 2026:
| ● | Cash and cash equivalents $0.69 million denominated in AUD, $0.02 million denominated in EUR, $0.04 million denominated in GBP and $0.08 million in NOK. | |
| ● | Restricted cash $0.06 million denominated in AUD. | |
| ● | Trade and other receivables $0.62 million denominated in AUD, $5.15 million in NOK, $0.12 million in AED and $0.02 million in GBP. | |
| ● | Trade and other payables $6.0 million denominated in NOK and $4.3 million in GBP |
Of the total shareholder loan of $27.3 million, $25.4 million is denominated in USD and $1.9 million is denominated in AUD.
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We have not entered into any hedging transactions to reduce the foreign exchange rate fluctuation risks but may do so in the future when we deem it appropriate in light of the significance of such risks. However, if we decide to hedge our foreign exchange exposure in the future, we cannot assure you that we will be able to reduce our foreign currency risk exposure in an effective manner, at reasonable costs, or at all. See “Item 3. Key Information-D. Risk Factors-Risks related to our business and operations -We are exposed to foreign currency exchange risks because certain of our operations are located in foreign countries”.
Our financial statements are expressed in U.S. dollars, while some of our subsidiaries use different functional currencies, such as the Australian dollar, Norwegian krone, British pound sterling and Euro. The value of your investment in our common shares will be affected by the foreign exchange rate between the U.S. dollar and other currencies used by our subsidiaries. To the extent we hold assets denominated in currencies other than U.S. dollars, any appreciation of such currencies against the U.S. dollar will likely result in an exchange gain while any depreciation will likely result in an exchange loss when we convert the value of these assets into U.S. dollar equivalent amounts. On the other hand, to the extent we have liabilities denominated in currencies other than U.S. dollars, any appreciation of such currencies against the U.S. dollar will likely result in an exchange loss while any depreciation will likely result in an exchange gain when we convert the value of these liabilities into U.S. dollar equivalent amounts. These and other effects on our financial condition resulting from the unfavorable changes in foreign currency exchange rates could have a material adverse effect on the market price of our common shares, the dividends we may pay in the future, and your investment.
Interest Rate Risk
As a result of the related party loan agreement, the Group is exposed to interest rate volatility. However, the interest rate is fixed for the medium term, therefore, the risk is largely mitigated for the near future. The Group will continue to monitor the movements in the wider global economy.
Credit Risk
Our credit risk primarily relates to our trade and other receivables, restricted cash, bank balances and amounts due from related parties. Our largest credit exposure is the US$53.3 million receivable for subscription amounts under our Regulation S placement, which is unsecured, represented 69% of our current assets at June 30, 2026, and has not been paid when due. Our revenue is also concentrated in one customer, Corner Norway. We monitor overdue balances and review the recoverability of individual debtors at the end of each reporting period.
Liquidity Risk
Our liquidity risk management framework is intended to ensure that we maintain sufficient funds to meet our obligations as they become due, and as part of our framework we continuously monitor our liquidity and cash resources and seek to maintain sufficient cash using cash flows generated by our business activities, debt arrangements and other resources. We continuously review forecasted cash flows to ensure our businesses have sufficient cash resources and liquidity to meet their obligations.
Market Risk
Bitcoin price risk: Nordland Data receives a share of the bitcoin mined under the Corner hosting agreement as a compute-based fee, measured at fair value on each service day. Our hosting revenue therefore varies with the market price of bitcoin. We do not hedge this exposure.
Equity price risk: The fair value of our warrant liabilities depends on our share price, and changes in fair value are recognized in profit or loss. We do not hedge this exposure.
ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
Not applicable.
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PART II
ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
Not applicable.
ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
A. to D. Material modifications to the rights of security holders
At a general meeting held on January 30, 2026, our shareholders approved the redesignation of our existing ordinary shares of US$0.12 each as Class A ordinary shares, and our articles of association now provide for Class A ordinary shares, Class B ordinary shares and preference shares. Each Class A ordinary share carries one vote. Our articles also authorize Class B ordinary shares, which would carry twenty votes each, have equal economic rights to the Class A ordinary shares and convert into Class A ordinary shares on a one-for-one basis in the circumstances set out in our articles. No shares have been redesignated as Class B ordinary shares and no Class B ordinary shares exist or have been issued. All of our issued ordinary shares are Class A ordinary shares.
During FY2026 we issued convertible preference shares (“CPS”) with a par value of US$100 each, a 6% dividend payable in kind and a conversion price of US$6.80 per Class A ordinary share. The CPS rank ahead of our Class A ordinary shares as to dividends and on a return of capital. See “Item 10. Additional Information - B. Memorandum and Articles of Association” for a description of the rights of each class of our shares.
E. Use of proceeds
Not applicable.
ITEM 15. CONTROLS AND PROCEDURES
a) Disclosure controls and procedures
Our management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of June 30, 2026. Based on this evaluation, and because of the material weaknesses in internal control over financial reporting described below, management concluded that our disclosure controls and procedures were not effective as of such date.
| (b) | Management’s annual report on internal control over financial reporting. |
Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) under the Exchange Act. Management assessed the effectiveness of the Company’s internal control over financial reporting as of June 30, 2026, using the criteria set out in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Based on that assessment, management concluded that internal control over financial reporting was not effective as of June 30, 2026, because of the material weaknesses described below. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented, or detected and corrected, on a timely basis.
Following the prior-year audit, management recognized the need to strengthen the Group’s accounting resources to support its existing business and planned growth. After the departure of the previous accounting team, the Group appointed a new Chief Accounting Officer, who has recruited experienced accounting professionals. Alongside preparing the FY2026 financial statements, the new team has reviewed accounting and control procedures and is working to update systems and procedures to address the material weaknesses described below.
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The material weaknesses identified related to the Company’s consolidated financial reporting process and included the following:
● Controls over the timeliness, completeness and accuracy of the financial close and reporting process were not adequately designed or operating effectively to ensure that all material transactions and developments were properly recorded. Management recorded various post-close adjustments during the audit affecting significant accounts and disclosures, including investment and intangible asset valuations, business combination valuations and acquisition opening balances, and equity and equity-based transactions, including warrants and stock subscription receivables.
● The Company did not utilize the journal entry approval functionality within NetSuite. Journal entries were not subject to formal approval when recorded; instead, approvals were performed retrospectively during the month-end close process.
● The Company did not document its review and approval of certain subsidiaries’ monthly financial reporting packages maintained by a third-party accounting firm, increasing the risk that material misstatements would not be identified and corrected on a timely basis.
● User access listings were not reviewed or updated regularly, increasing the risk of unauthorized access and inadequate segregation of duties.
● The Company did not consistently maintain executed, countersigned agreements supporting recorded balances. In certain cases, agreements remained in draft form, creating a risk to the completeness and accuracy of liability recognition.
● Detailed supporting schedules were not provided for certain account balances, and reliance was placed on general ledger details, limiting the ability to substantiate the accuracy and completeness of those balances.
As of June 30, 2026, the material weaknesses described above remained outstanding. Building on the staffing changes described above, management has begun implementing a remediation plan, including enhancing staff training and implementing automated workflows.
The remediation plan is intended to strengthen the Company’s financial reporting processes through the following measures:
● Formalizing the group financial close timetable and reporting checklist, assigning responsibility for significant balances and disclosures, and requiring documented review of the accounting for acquisitions, valuations, warrants and other complex transactions, with support from qualified external specialists where appropriate.
● Implementing the journal entry approval functionality in NetSuite, establishing appropriate separation between preparers and approvers, and retaining supporting documentation and evidence of approval before entries are posted.
● Establishing standardized monthly reporting packages for subsidiaries, including those maintained by third-party accounting firms, and requiring documented review and approval by group finance.
● Establishing periodic reviews of system access and incompatible permissions, and procedures for promptly removing access that is no longer required.
● Maintaining a central register of executed agreements and requiring finance review of contractual terms and supporting documentation for recorded balances, with documented review and escalation of exceptions involving unsigned agreements.
● Requiring detailed supporting schedules and reconciliations for significant account balances, with designated preparers and reviewers and documented investigation and resolution of reconciling items.
Management intends to monitor the implementation of these measures and report progress to the Audit Committee. The material weaknesses will not be considered remediated until the relevant controls have operated for a sufficient period and management has tested their effectiveness. The Company cannot provide assurance as to when remediation will be completed or that these measures will be sufficient to remediate all identified material weaknesses.
(c) Attestation report of the registered public accounting firm
This Annual Report does not include an attestation report of our registered public accounting firm on internal control over financial reporting because we are a non-accelerated filer.
(d) Changes in internal control over financial reporting
Except for the remediation efforts described above, there were no changes in our internal control over financial reporting during the year ended June 30, 2026, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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ITEM 16. [Reserved]
ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT
The Audit and Risk Committee is comprised of William Langdon (who is Chair of the Audit and Risk Committee), Peter Jeavons and Michael Hui, each of whom the Board has determined to be independent under the applicable Nasdaq listing standards and to meet the independence requirements of Rule 10A-3 under the Exchange Act. Peter Jeavons and William Langdon joined the committee on June 16, 2020, and Michael Hui joined the committee in the second quarter of FY26.
The Audit and Risk Committee is required to be composed exclusively of “independent directors,” as defined under the Nasdaq listing standards and the rules and regulations of the SEC, and each of whom must be, among other requirements, “financially literate,” as defined under the Nasdaq listing standards. The Nasdaq listing standards define “financially literate” as being able to read and understand fundamental financial statements, including a company’s balance sheet, income statement and cash flow statement. In addition, VivoPower is required to certify to Nasdaq that the committee has at least one member who has past employment experience in finance or accounting, requisite professional certification in accounting, or other comparable experience or background that results in the individual’s financial sophistication.
Our Board has determined that William Langdon satisfies Nasdaq’s definition of financial sophistication and qualifies as an “audit committee financial expert” as defined in Item 16A of Form 20-F, and is independent under the applicable Nasdaq listing standards and Rule 10A-3 under the Exchange Act.
ITEM 16B. CODE OF ETHICS
We have adopted a Code of Business Conduct and Ethics that is applicable to all of our employees, executive officers and directors. The Code of Business Conduct and Ethics is available on our website at www.vivopower.com. Our Board is responsible for overseeing the Code of Business Conduct and Ethics and approving any waivers of the Code of Business Conduct and Ethics for employees, executive officers and directors. We expect that any amendments to the Code of Business Conduct and Ethics, or any waivers of its requirements, will be disclosed on our website.
VivoPower became certified as a B Corporation in April 2018. VivoPower recertified as a B Corporation in 2021 and was recognized in the Best For The World program as being in the top 5% amongst B Corporations for Governance. In June 2026, we recertified as a Certified B Corporation, extending our B Corp status to 2028. Consistent with this certification, the shareholders approved changes to the Articles of Association of the Company at the annual general meeting on August 20, 2018, to include:
| (i) | the purposes of the Company are to promote the success of the Company for the benefit of its members as a whole and, through its business and operations, to have a material positive impact on society and the environment, taken as a whole; |
| (ii) | in exercising the powers of the Company, a Director shall have regard to, among other matters, stakeholder interests such as: |
| a. | the likely consequences of any decision in the long term; | |
| b. | the interests of the Company’s employees; | |
| c. | the need to foster the Company’s business relationships with suppliers, customers and others; | |
| d. | the impact of the Company’s operations on the community and the environment; | |
| e. | the desirability of the Company maintaining a reputation for high standards of business conduct; and, | |
| f. | the need to act fairly as between members of the Company. |
As a B Corp, the Company is committed to continuously improve its B Corporation score and deliver on the B Corporation triple bottom line of Planet, People and Profit.
ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The following table sets forth the fees billed or incurred by WithumSmith+Brown, PC for the years ended June 30, 2026 and June 30, 2025, and by PKF Littlejohn LLP for the years ended June 30, 2024, for audit, audit-related, tax, and all other services rendered.
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Audit fees | $ | 315 | $ | 250 | $ | 267 | ||||||
| Audit-related fees | - | - | - | |||||||||
| Tax fees | 15 | - | - | |||||||||
| Total | $ | 330 | $ | 250 | $ | 267 | ||||||
Audit Fees
The audit fees of $315,000 represent the fees of WithumSmith+Brown, PC for audit of June 30, 2026 financial statements.
The audit fees of $250,000 represent the fees of WithumSmith+Brown, PC for audit of June 30, 2025 financial statements.
The audit fees of $267,000 represent the fees of PKF Littlejohn LLP and related firms for audit of the June 30, 2024 financial statements.
Tax Fees
The tax fee of $15,000 represent the fees of Nexus Georgie, tax computation of June 30, 2026 financial statements.
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Tax and Capital Raise – Related Fees
Pre-Approval Policies for Non-Audit Services
The Audit and Risk Committee has adopted policies and procedures relating to the approval of all audit and non-audit services that are to be performed by our independent registered public accounting firm. These policies generally provide that we will not engage our independent registered public accounting firm to render audit or non-audit services unless the service is specifically approved in advance by the Audit and Risk Committee or the engagement is entered into pursuant to the pre-approval procedure described below. All of the services related to our company provided by our independent registered public accounting firm during the last two fiscal years have been approved by the Audit and Risk Committee.
The Audit and Risk committee pre-approves all auditing services and the terms of non-audit services, but only to the extent that the non-audit services are not prohibited under applicable law and the committee determines that the non-audit services do not impair the independence of the independent registered public accounting firm. In situations where it is impractical to wait until the next regularly scheduled quarterly meeting, the chairman of the Audit and Risk Committee has been delegated authority to approve audit and non-audit services. The Chairman is required to report any approvals to the full committee at its next scheduled meeting.
From time to time, the Audit and Risk Committee may pre-approve specified types of services that are expected to be provided to us by our independent registered public accounting firm during the next 12 months. Any such pre-approval is detailed as to the particular service or type of services to be provided and is also generally subject to a maximum dollar amount. Any proposed services exceeding pre-approved amounts will also require separate pre-approval by the Audit and Risk Committee.
ITEM 16D. EXEMPTION FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
Not applicable.
ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
During FY26, neither the Company nor any affiliated purchaser purchased any Class A Ordinary Shares or other equity securities of the Company registered under Section 12 of the Exchange Act in the open market or otherwise, other than acquisitions of newly issued Class A Ordinary Shares by our directors, officers and their affiliates through primary subscriptions from the Company or issuances in lieu of remuneration, which are described in Item 6.E and Item 7.B.
ITEM 16F. CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT
The information required by Item 16F(a) of Form 20-F regarding the dismissal of PKF Littlejohn LLP and the engagement of WithumSmith+Brown, PC, each approved by our Audit Committee on August 26, 2025, was previously reported in Item 16F of our Annual Report on Form 20-F/A for the fiscal year ended June 30, 2025, filed with the SEC on November 6, 2025. The letter from PKF Littlejohn LLP dated November 6, 2025 was filed as Exhibit 16.1 to that report.
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ITEM 16G. CORPORATE GOVERNANCE
As a foreign private issuer whose Class A ordinary shares are listed on The Nasdaq Capital Market, we are permitted under Nasdaq Listing Rule 5615(a)(3) to follow home country practice in lieu of certain Nasdaq corporate governance requirements. We currently follow the practice of England and Wales, our home country, in lieu of the following Nasdaq requirements:
● Shareholder approval of share issuances (Rule 5635). We follow the Companies Act 2006 and our Articles of Association rather than the Nasdaq shareholder approval requirements.
● Quorum (Rule 5620(c)). Our Articles of Association provide that the quorum for a general meeting is two persons entitled to vote, rather than 33⅓% of our outstanding shares.
● Proxy solicitation (Rule 5620(b)). We follow the Companies Act 2006 and our Articles of Association for notices of meetings and proxies rather than soliciting proxies and providing proxy statements under Nasdaq rules.
We comply with the Nasdaq requirements that a foreign private issuer may not replace with home country practice, including the audit committee requirements of Rule 5605(c)(3) and Rule 10A-3 under the Exchange Act. We have provided Nasdaq with a letter from our UK counsel certifying that these practices are not prohibited by the laws of England and Wales.
ITEM 16H. MINE SAFETY DISCLOSURE
Not applicable.
ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
Not applicable.
ITEM 16J. INSIDER TRADING POLICIES
We
have an
ITEM 16K. CYBERSECURITY
Risk Management and Strategy
We maintain policies and procedures for the identification, assessment and management of material cybersecurity risks. These include:
| ● | regular risk assessments and network monitoring to identify vulnerabilities across corporate and subsidiary systems; | |
| ● | deployment of multi-factor authentication, encryption, and access-control mechanisms for sensitive data and systems; | |
| ● | cyber incident response and recovery protocols aligned with recognized frameworks; and | |
| ● | due
diligence and ongoing oversight of |
The Board of Directors has ultimate oversight of cybersecurity risk management and receives periodic updates from management on cybersecurity risks and incidents. Day-to-day responsibility for managing cybersecurity risk resides with our Group Finance Director and our Managing Director, Data Center, who coordinate with our external IT providers and consultants. They are responsible for ensuring that our security policies, training programs and incident-response plans remain current with regulatory and technological developments.
Material Impact and Incidents
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PART III
ITEM 17. FINANCIAL STATEMENTS
See Item 18.
ITEM 18. FINANCIAL STATEMENTS
Financial statements are filed as part of this Annual Report, starting on page F-1.
ITEM 19. EXHIBITS
Exhibit Number |
Description | |
| 1.1 | Articles of Association (incorporated by reference to Exhibit 3.1 to the Registrant’s Form S-8 filed March 13, 2026, File No. 333-294305) | |
| 2.1 | Description of Securities. | |
| 4.1 | Omnibus Incentive Plan, adopted September 5, 2017 and amended July 28, 2023 (incorporated by reference to Exhibit 99.1 to the registration Statement on Form S-8 (File No. 333-273520), filed with the SEC on July 28, 2023). | |
| 4.2 | Equity Distribution Agreement, dated November 12, 2021, between VivoPower PLC and A.G.P./Alliance Global Partners (incorporated by reference to Exhibit 10.1 to the Current Report on Form 6-K (File No. 001-37974), filed with the SEC on November 21, 2021). | |
| 4.3 | Amendment No. 1 to Equity Distribution Agreement, dated July 29, 2022, between VivoPower PLC and A.G.P./Alliance Global Partners (incorporated by reference to Exhibit 10.1 to the Current Report Form 6-K (File No. 001-37974), filed with the SEC on July 29, 2022). | |
| 4.4 | Strategic Direct Investment in Tembo dated June 28, 2023 (incorporated by reference to Exhibit 99.1 on Form 6-K - Report of foreign issuer [Rules 31a-16 and 15d-16], filed with the SEC on June 28, 2023. | |
| 4.5 | Placement Agency Agreement, dated July 29, 2022, between VivoPower PLC and A.G.P./Alliance Global Partners (incorporated by reference to Exhibit 1.1 to the Current Report on Form 6-K (File No. 001-37974), filed with the SEC on August 2, 2022). | |
| 4.6 | Form of Series A Warrant (incorporated by reference to Exhibit 4.1 to the Current Report on Form 6-K (File No. 001-37974), filed with the SEC on August 2, 2022). | |
| 4.7 | Form of Pre-Funded Warrant (incorporated by reference to Exhibit 4.2 to the Current Report on Form 6-K (File No. 001-37974), filed with the SEC on August 2, 2022). | |
| 4.8 | Form of Securities Purchase Agreement, dated July 29, 2022, between VivoPower PLC and the purchaser identified therein (incorporated by reference to Exhibit 10.1 to the Current Report on Form 6-K (File No. 001-37974), filed with the SEC on August 2, 2022). | |
| 4.9 | Regulation S Subscription Agreement† | |
| 4.10 | Share Purchase Agreement relating to the shares in Cromwell AS.† | |
| 4.11 | Hosting and Maintenance Agreement between Nordland Data AS and Corner Norway AS.† | |
| 4.12 | Land Lease Agreement between Mo Industripark AS and Nordland Data AS.† | |
| 4.13 | Form of Securities Purchase Agreement between VivoPower PLC and the investors named therein (PIPE 1).† | |
| 4.14 | Registration Rights Agreement between VivoPower PLC and the investors named therein (PIPE 1).† | |
| 4.15 | Form of Contingent Cashless Warrant (PIPE 1).† | |
| 4.16 | Form of Securities Purchase Agreement between VivoPower PLC and the investors named therein (PIPE 2).† | |
| 4.17 | Registration Rights Agreement between VivoPower PLC and the investors named therein (PIPE 2).† | |
| 4.18 | Form of Contingent Cashless Warrant (PIPE 2).† | |
| 4.19 | Warrant Agreement between VivoPower PLC and AWN Holdings Limited.† | |
| 4.20 | Amended and Extended Loan Agreement between VivoPower PLC (formerly VivoPower International PLC) and AWN Holdings Limited.† | |
| 4.21 | Subscription Agreement for New Shares between KWeather Co., Ltd. and VivoPower PLC.† | |
| 4.22 | Bridge Finance Loan Agreement (US$3,500,000, January 2026) between TAG INTL DMCC and VivoPower PLC.† | |
| 4.23 | Bridge Finance Loan Agreement (US$5,000,000, February 2026) between TAG INTL DMCC and VivoPower PLC.† | |
| 4.24 | PIPE Subscription Agreement between Tembo e-LV B.V. and Energi Holdings Limited.† | |
| 4.25 | Convertible Note Deed between Tembo e-LV B.V. and the sellers named therein, with the related Share Purchase Agreement relating to EnduroCo Pty Ltd.† | |
| 8 | List of Subsidiaries. | |
| 11.1 | Code of Business Conduct and Ethics (incorporated by reference to Exhibit 11 to the Annual Report on Form 20-F (File No. 001-37974), filed with the SEC on August 1, 2017. | |
| 11.2 | Insert Insider Trading policy | |
| 12.1 | Certification of Chief Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 12.2 | Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 13.1 | Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
| 13.2 | Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
| 15.1 | Consent of WithumSmith+Brown, PC, Independent Registered Public Accounting Firm. | |
| 15.2 | Consent of PKF Littlejohn LLP, Independent Registered Public Accounting Firm. | |
| 97.1 | Insert Clawback Policy | |
| 101.INS | Inline XBRL Instance Document | |
| 101.SCH | Inline XBRL Taxonomy Extension Schema | |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase | |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase | |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase | |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase | |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
* Confidential treatment has been requested or granted for certain portions omitted from this Exhibit pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.
† Certain identified information has been omitted from this exhibit because it is not material and is the type of information that the Company customarily and actually treats as private and confidential. Omissions are designated with [***].
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SIGNATURE
The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this Annual Report on its behalf.
| VIVOPOWER PLC | ||
| By: | /s/ Kevin Chin | |
| Name: | Kevin Chin | |
| Title: | Chief Executive Officer | |
Date: November 2, 2026
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VIVOPOWER PLC
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
| Page | |
| Report
of Independent Registered Public Accounting Firm (PCAOB ID |
F-2 |
| Report of Independent Registered Public Accounting Firm (PCAOB
ID |
F-5 |
| Consolidated Statements of Comprehensive Loss for the Years Ended June 30, 2026, June 30, 2025 and June 30, 2024 | F-7 |
| Consolidated Statements of Financial Position as of June 30, 2026, June 30, 2025 and June 30, 2024 | F-8 |
| Consolidated Statements of Cash Flows for the Years Ended June 30, 2026, June 30, 2025 and June 30, 2024 | F-9 |
| Consolidated Statements of Changes in Equity (Deficit) for the Years Ended June 30, 2026, June 30, 2025 and June 30, 2024 | F-10 |
| Notes to Consolidated Financial Statements | F-11 |
| F-1 |
| Table of Contents |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF VIVOPOWER PLC
Opinion on the Consolidated Financial Statements
The consolidated financial statements of the Company as of and for the year ended June 30, 2024, were audited by other auditors whose report dated December 19, 2024, expressed an unmodified opinion on those consolidated financial statements.
Restatement of the Previously Issued Consolidated Financial Statements
As discussed in Note 35 to the consolidated financial statements, the 2025 consolidated financial statements have been restated to correct a misstatement.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
| F-2 |
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Valuation of Intangible Assets and Goodwill - Refer to Note 13 to the Consolidated Financial Statements
Critical Audit Matter Description
As reflected in the Company’s consolidated financial statements at and as of June 30, 2026 and 2025, the carrying value of goodwill and intangible assets was $18.2 and $35.8 million. Details of these assets and the related critical judgments and estimates are disclosed in notes 2, 3 and 13. The carrying value of goodwill and other intangible assets is significant and at risk of non-recoverability. The estimated recoverable amount of these balances is subjective due to the inherent uncertainty involved in forecasting and discounting cash flows.
In an impairment test the recoverable amount of the cash-generating unit or asset is estimated in order to determine the existence or extent of any impairment loss. The recoverable amount is the higher of fair value less costs to sell and the value in use to the Company. An impairment loss is recognized to the extent that the carrying value exceeds the recoverable amount. In determining a cash-generating unit’s or asset’s value in use, 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 risks specific to the cash-generating unit or asset that have not already been included in the estimate of future cash flows.
An impairment loss in respect of goodwill is not reversed. In the case of other assets, impairment losses recognized in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. These impairment losses are reversed if there has been any change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent so that the asset’s carrying amount does not exceed the carrying value that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.
We identified the evaluation of the Company’s impairment test of goodwill and intangible assets as a critical audit matter due to significant management estimates and judgments inherently required in determining the fair value estimates. This in turn led to a high degree of auditor judgment, subjectivity, and effort in performing procedures to evaluate the reasonableness of management’s significant estimates and assumptions, several of which extend many years into the future. Additionally, the audit effort involved the use of professionals with specialized skill and knowledge.
How the Critical Audit Matter Was Addressed in the Audit
We performed a walk-through of the design effectiveness and implementation of internal controls related to financial reporting of the intangible assets and goodwill. Additional procedures included testing management’s process for developing their impairment estimate, which included evaluating the appropriateness of the method used by the Company to develop cash flow projections for intangible assets and goodwill, as well as testing the completeness and accuracy of the underlying data used in the estimates. In addition, we evaluated the reasonableness of significant assumptions including future sales, long-term growth rates, and future economic conditions and performed sensitivity testing on some assumptions. We evaluated these assumptions for their reasonableness considering (i) historical performance; (ii) industry and economic forecast and (iii) whether the assumptions were consistent with evidence obtained in other areas of the audit.
Along with the procedures previously described, we performed the following procedures:
| ● | We utilized the knowledge, experience, and expertise of our internal valuation specialists to execute the planned audit procedures related to the valuation by assessing the reasonableness of the methodologies employed to value the intangible assets and goodwill. | |
| ● | We tested the underlying assumptions presented in the impairment assessment as it relates to projections. | |
| ● | We assessed the appropriateness of the Company’s disclosure in respect of the judgements and estimates on whether an impairment exists. |
| F-3 |
| Table of Contents |
Related Party Transactions - Refer to Note 32 to the Consolidated Financial Statements
Critical Audit Matter Description
As reflected in the Company’s consolidated financial statements at and as of June 30, 2026 and 2025, the Company has entered into various transactions with related parties. These transactions include intercompany loans, service arrangements, and other financial dealings with entities under common control or significant influence. The nature and volume of these related party transactions are material to the consolidated financial statements and require careful evaluation to ensure appropriate disclosure, recognition, and compliance with applicable accounting standards.
The assessment of related party transactions involves significant management judgment, particularly in identifying related parties, determining the commercial substance of transactions, and evaluating whether such transactions were conducted at arm’s length. In some cases, the terms and conditions of these transactions may not be readily observable in the market, increasing the risk of misstatement or omission.
We identified the evaluation of the nature and volume of related party transactions as a critical audit matter due to the complexity and subjectivity involved in assessing the completeness and accuracy of disclosures, as well as the potential for management override or bias. Auditing this matter required a high degree of auditor judgment and effort, including understanding the Company’s governance and control environment, reviewing board minutes and legal agreements, and performing detailed transaction testing.
How the Critical Audit Matter Was Addressed in the Audit
Our audit procedures included evaluating the Company’s process for identifying related parties, inspecting underlying documentation supporting the transactions, and assessing whether the disclosures in the consolidated financial statements were complete and transparent. We also considered the consistency of these transactions with the Company’s business purpose and strategic objectives. Given the significance of these transactions and the potential implications for financial reporting and stakeholder perception, we involved professionals with expertise in forensic accounting and regulatory compliance to assist in our evaluation.
Along with the procedures previously described, we performed the following procedures:
| ● | Obtained and reviewed management’s related party register to identify all entities and individuals considered related parties under applicable accounting standards. | |
| ● | Inspected board minutes, shareholder agreements, and other governance documents to identify any undisclosed related party relationships or transactions. | |
| ● | Reviewed legal agreements and contracts supporting material related party transactions to assess their commercial substance and terms. | |
| ● | performed detailed testing of related party transactions, including loans, service arrangements, and asset transfers, to verify accuracy, completeness, and appropriate classification. | |
| ● | Evaluated the adequacy and transparency of disclosures in the consolidated financial statements, ensuring compliance with relevant accounting and regulatory requirements. | |
| ● | Performed inquiries with management and those charged with governance to understand the nature, purpose, and business rationale of significant related party transactions. | |
| ● | Reviewed journal entries and general ledger activity for indicators of undisclosed related party transactions or management override. |
Business Combination - Refer to Note 14 to the consolidated financial statements
Critical Audit Matter Description
As reflected in the Company’s consolidated financial statements as of June 30, 2026, the Company completed a business combination on May 12, 2026, for approximately $37.7m. Details of the acquired net assets and the related critical judgments and estimates are disclosed in notes 2 and 14. As disclosed in the consolidated financial statements, the Company allocated the purchase price to acquired assets and liabilities, including intangibles and the residual value being assigned to goodwill.
The fair value assigned to the acquired intangibles is based on a discounted flow analysis, in which the Company makes various assumptions, including assumptions about future cash flows, growth rates and discount rates. The assumptions about future cash flows and growth rates are based on the Company’s long-term projections. Assumptions used in the Company’s fair value calculations are consistent with the Company’s internal forecasts and operating plans. The Company’s discount rate is based on the Company’s debt structure, adjusted for current market conditions.
We identified the evaluation of the Company’s fair value valuation of acquired intangibles and residual goodwill as a critical audit matter due to significant management estimates and judgments inherently required in determining the fair value estimates. This in turn led to a high degree of auditor judgment, subjectivity, and effort in performing procedures to evaluate the reasonableness of management’s significant estimates and assumptions, several of which extend many years into the future. Additionally, the audit effort involved the use of professionals with specialized skill and knowledge.
How the Critical Audit Matter Was Addressed in the Audit
We performed a walkthrough and obtained an understanding over the design effectiveness and implementation of the internal controls related to the Company’s acquisition-date valuation process, including controls related to the development of the key assumptions for certain tangible and intangible assets. We read and evaluated the valuation analysis summary report, prepared by the Company specialists that assessed the fair value of the Company’s business combination as of June 30, 2026. We evaluated the reasonableness of the Company’s forecasted revenue growth rates utilized in the valuation report by comparing the projections to historical results and obtaining an understanding of management’s rationale for the projected growth, examined the Company’s customer contracts and arrangements, and evaluated subsequent revenue data for reasonableness. We also performed an evaluation over the consideration paid, net asset balances as of the transaction date, and the residual value assigned to Goodwill.
In addition, we involved valuation professionals with specialized skills and knowledge, who assisted in:
| ● | evaluating the discount rates used by the Company for the intangible assets by comparing them against discount rate ranges that were independently developed using publicly available market data for comparable entities | |
| ● | testing the source information underlying the determination of the discount rates | |
| ● | We utilized the knowledge, experience, and expertise of our internal valuation specialists to execute the planned audit procedures related to the valuation by assessing the reasonableness of the methodologies employed to value the business combination. |
| /s/
|
We have served as the Company’s auditor since 2025.
November 2, 2026 |
PCAOB ID Number 100
| F-4 |
| Table of Contents |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders of VivoPower PLC
Opinion on the Financial Statements
We have audited the accompanying consolidated statements of financial position of VivoPower PLC and its subsidiaries (the Company) as of 30 June 2024, and the related consolidated statements of income, comprehensive income, stockholders’ equity, and cash flows for the year ended 30 June 2024 and the related notes and schedules (collectively referred to as the consolidated financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of 30 June 2024 and the results of its operations and its cash flows for the years ended 30 June 2024, in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Substantial doubt about the Company’s ability to continue as a Going Concern
We draw attention to note 2.1 in the financial statements, which indicates that the group and company are reliant on raising finance and capital within the 12 months, further reduce its cash burn rate, negotiate payment plans with its key creditors and lenders and generate sufficient revenues and cashflows from its expanded range of products and solutions, following the date of approval of these financial statements in order to meet its working capital requirements and continue to fund operations over this period. As stated in note 2.1, these events or conditions, indicate that substantial doubt exists about the group’s ability to continue as a going concern. Our opinion is not modified in respect of this matter.
In auditing the financial statements, we have concluded that the director’s use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors’ assessment of the group’s ability to continue to adopt the going concern basis of accounting included a review of the group and budgets and cash flow forecasts for the period of at least twelve months from the date of approval of the financial statements, including checking the mathematical accuracy of the budgets and discussion of significant assumptions used by the management.
We reviewed the net current liabilities outstanding and payable in the next 12 months as of 30 September 2024 and reviewed the plans of the group regarding settling these liabilities post 30 September, including payment plans with certain creditors and lenders. We have also reviewed the latest available bank statements, regulatory announcements and board minutes and assessed subsequent events impacting going concern.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
| F-5 |
| Table of Contents |
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
| Critical Audit Matter | How we addressed the matter in our audit | |
| Going concern basis of preparation | ||
| The financial statements have been prepared on a going concern basis which assumes that the Company and Group will be able to discharge its liabilities as they fall due, despite the net current liability position of $36 million as at June 30, 2024. | Our work in this area included:
● Obtaining the Groups cash flow forecast for a period of twelve months from the date of the financial statements;
● Obtaining the latest current net liability position, evidence of certain third party and related party’s agreement to defer current liabilities over a period of one year;
● Verifying, the post year end receipt of cash in respect of share issues subsequent to the year end and the proceeds on the disposal of Vivo PTY Limited, along with the settlement of liabilities post year end;
● Obtaining the signed loan facility providing for the future draw down of $12m, which the Directors consider to be satisfactory to enable them to meet the net liability position and to provide further working capital for the business;
● Assessing the appropriateness of the disclosure of the going concern basis of preparation, including the substantial doubt about the Company’s ability to continue as a going concern. | |
| Recoverability of intangible assets and testing for impairment | ||
As at June 30, 2024 the carrying value of goodwill and intangible assets was $2 million. Details of these assets and the related critical judgements and estimates are disclosed in notes 3.2 and 13.
The carrying value of goodwill and other intangible assets is significant and at risk of non-recoverability. The estimated recoverable amount of these balances is subjective due to the inherent uncertainty involved in forecasting and discounting cash flows. |
Our work in this area included:
● Reviewing and challenging management’s value in use calculations and/or their fair value less costs to sell calculations, including the rationale behind the key assumptions and cash flow forecasts;
● Checking the mathematical accuracy of the value in use calculations;
● Performing sensitivity analysis on reasonably possible changes in key assumptions and the impact on the headroom;
● Assessing the accuracy of budgets and forecasts used in prior periods to actual results;
● Performing an independent assessment to identify any indicators of impairment; and
● Assessing the appropriateness of the group’s disclosure in respect of the judgements and estimates on whether an impairment exists, the sensitivity analysis on the headroom and the disclosure of the impairment charges amounting to $29.5m (refer to Note 13). | |
| Capitalisation of development costs in accordance with IAS 38 | ||
As at June 30, 2024 the carrying value of capitalised intangible assets was $11.6 million. There is a risk that the capitalised costs are ineligible in accordance with the requirements of IAS 38. Details of these assets and the related critical judgements and estimates are disclosed in notes 3.5 and 13.
Given the significance of the development costs on the Group’s statement of financial position and the significant management judgement involved in the determination and the assessment of the carrying values of these assets, there is a risk these costs are not fully recoverable and should be impaired. |
Our work in this area included:
● Testing an appropriate sample of additions during the year to supporting documentation;
● Testing and evaluating that all the eligibility criteria for capitalisation within IAS 38 have been met;
● Considering whether there are indicators of impairment, in conjunction with revenues achieved and contracted; and
● Checking the presentation and disclosure requirements are appropriate. |
We have served as the Company’s auditor since 2017.
/s/
PKF Littlejohn LLP
December 19, 2024
In September 2025, we became the predecessor auditor.
| F-6 |
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Consolidated Statements of Comprehensive Loss
| (US dollars in thousands, except per share amounts) | Note | 2026 | 2025*restated | 2024 | ||||||||||
| Year Ended June 30 | ||||||||||||||
| (US dollars in thousands, except per share amounts) | Note | 2026 | 2025*restated | 2024 | ||||||||||
| Revenue from contracts with customers | 4 | |||||||||||||
| Cost of sales | 4 | ( | ) | ( | ) | |||||||||
| Gross profit/(loss) | ||||||||||||||
| General and administrative expenses | 9 | ( | ) | ( | ) | ( | ) | |||||||
| Other gains | 5 | |||||||||||||
| Other income | 6 | - | - | |||||||||||
| Depreciation of property, plant and equipment | 12 | ( | ) | ( | ) | ( | ) | |||||||
| Amortization of intangible assets | 13 | ( | ) | ( | ) | ( | ) | |||||||
| Operating loss | 7 | ( | ) | ( | ) | ( | ||||||||
| Restructuring and other non-recurring costs | 8 | ( | ) | ( | ) | ( | ) | |||||||
| Impairment losses | 9 | ( | ) | ( | ) | ( | ) | |||||||
| Finance income | 10 | |||||||||||||
| Finance expense | 10 | ( | ) | ( | ) | ( | ) | |||||||
| Fair value loss on financial instruments | 9 | ( | ) | - | - | |||||||||
| Loss before income tax | 7 | ( | ) | ( | ) | ( | ) | |||||||
| Income tax | 11 | ( | ) | ( | ) | |||||||||
| Loss from continuing operations | 7 | ( | ) | ( | ) | ( | ) | |||||||
| (Loss)/profit from discontinued operations | 22 | ( | ) | |||||||||||
| Loss for the period | ( | ) | ( | ) | ( | ) | ||||||||
| Losses attributable to: | ||||||||||||||
| Equity owners of VivoPower PLC | ( | ) | ( | ) | ( | ) | ||||||||
| Loss for the period | ( | ) | ( | ) | ( | ) | ||||||||
| Other comprehensive loss | ||||||||||||||
| Items that may be reclassified subsequently to profit or loss: | ||||||||||||||
| Currency translation differences recognized directly in other comprehensive loss | ( | ) | ( | ) | ||||||||||
| Total comprehensive loss for the period attributable to owners of the company | ( | ) | ( | ) | ( | ) | ||||||||
| Losses per share attributable to owners of the company, net of related tax effects (dollars) | ||||||||||||||
| Continuing Operations | ||||||||||||||
| Basic | 29 | ( | ) | ( | ) | ( | ) | |||||||
| Continuing Operations - Basic | ( | ) | ( | ) | ( | ) | ||||||||
| Diluted | 29 | ( | ) | ( | ) | ( | ) | |||||||
| Continuing Operations - Diluted | ( | ) | ( | ) | ( | ) | ||||||||
| Discontinued Operations | ||||||||||||||
| Basic | 29 | ( | ) | |||||||||||
| Discontinued Operations - Basic | ( | ) | ||||||||||||
| Diluted | 29 | ( | ) | |||||||||||
| Discontinued Operations - Diluted | ( | ) | ||||||||||||
See notes to financial statements
| F-7 |
| Table of Contents |
Consolidated Statements of Financial Position
| (US dollars in thousands) | Note | 2026 | 2025*restated | 2024 | ||||||||||
| Year Ended June 30 | ||||||||||||||
| (US dollars in thousands) | Note | 2026 | 2025*restated | 2024 | ||||||||||
| ASSETS | ||||||||||||||
| Non-current assets | ||||||||||||||
| Property, plant and equipment, net | 12 | |||||||||||||
| Right of use asset | 12 | - | ||||||||||||
| Intangible assets, net | 13 | |||||||||||||
| Deferred tax assets | 11 | - | ||||||||||||
| Other investments | 16 | - | - | |||||||||||
| Total non-current assets | ||||||||||||||
| Current assets | ||||||||||||||
| Cash and cash equivalents | 17 | |||||||||||||
| Restricted cash | 18 | |||||||||||||
| Trade and other receivables | 19 | |||||||||||||
| Inventory | 20 | |||||||||||||
| Digital assets | - | |||||||||||||
| Assets classified as held for sale | 21/22 | - | - | |||||||||||
| Total current assets | ||||||||||||||
| TOTAL ASSETS | ||||||||||||||
| LIABILITIES AND EQUITY | ||||||||||||||
| Current liabilities | ||||||||||||||
| Trade and other payables | 23 | |||||||||||||
| Lease liabilities | 26 | - | ||||||||||||
| Warrant derivative liability | 25 | - | - | |||||||||||
| Income tax liability | 11 | |||||||||||||
| Provisions | 24 | |||||||||||||
| Loans and borrowings | 26 | |||||||||||||
| Liabilities classified as held for sale | 21/22 | - | - | |||||||||||
| Total current liabilities | ||||||||||||||
| Non-current liabilities | ||||||||||||||
| Other payables | 23 | - | - | |||||||||||
| Provisions | 24 | |||||||||||||
| Loans and borrowings | 26 | |||||||||||||
| Lease liabilities | 26 | - | ||||||||||||
| Deferred tax liabilities | 11 | |||||||||||||
| Total non-current liabilities | ||||||||||||||
| Total liabilities | ||||||||||||||
| Equity | ||||||||||||||
| Share capital | 27 | |||||||||||||
| Share premium | 27 | |||||||||||||
| Shares subscription equity reserve | 27 | - | ||||||||||||
| Cumulative translation reserve | ( | ) | ( | ) | ||||||||||
| Convertible preference shares | - | - | ||||||||||||
| Other reserves | 28 | ( | ) | ( | ) | ( | ) | |||||||
| Accumulated deficit | ( | ) | ( | ) | ( | ) | ||||||||
| Equity and reserves attributable to owners | ( | ) | ||||||||||||
| Total equity | ( | ) | ||||||||||||
| TOTAL EQUITY AND LIABILITIES | ||||||||||||||
These financial statements were approved by the Board of Directors on November 02, 2026, and were signed on its behalf by Kevin Chin.
See notes to financial statements
| F-8 |
| Table of Contents |
Consolidated Statements of Cash Flow
| (US dollars in thousands) | Note | 2026 | 2025*restated | 2024 | ||||||||||
| Year Ended June 30 | ||||||||||||||
| (US dollars in thousands) | Note | 2026 | 2025*restated | 2024 | ||||||||||
| Cash flows from operating activities | ||||||||||||||
| Loss from continuing operations | ( | ) | ( | ( | ) | |||||||||
| (Loss)/profit from discontinued operations | 22 | ( | ) | |||||||||||
| Income tax | 11 | ( | ) | |||||||||||
| Finance expense | 10 | |||||||||||||
| Interest expense on lease liabilities | 10 | |||||||||||||
| Dividend accrued | 10 | - | - | |||||||||||
| Finance income | 10 | ( | ) | ( | ) | ( | ) | |||||||
| Depreciation of right of use asset | 12 | |||||||||||||
| Depreciation of property, plant and equipment | 12 | |||||||||||||
| Amortization of intangible assets | 13 | |||||||||||||
| Gain on disposal of property, plant and equipment | - | - | ||||||||||||
| Other gains/(losses) | 5 | ( | ) | ( | ) | ( | ) | |||||||
| Fair-value losses on derivatives, warrants and other investments | - | - | ||||||||||||
| Impairment of assets and receivables | ||||||||||||||
| Share-based payments | ||||||||||||||
| Decrease/(increase) in trade and other receivables | 19 | ( | ) | |||||||||||
| (Increase)/decrease in inventory | 20 | ( | ) | |||||||||||
| Increase in digital assets | - | ( | ) | - | ||||||||||
| Increase/(decrease) in lease liabilities - net | ( | ) | ||||||||||||
| Increase/(decrease) in trade and other payables | 23 | ( | ) | |||||||||||
| Increase/(decrease) in provisions | 24 | |||||||||||||
| Net cash from/(used in) operating activities | ( | ) | ( | ) | ||||||||||
| Cash flows from investing activities | ||||||||||||||
| Proceeds on sale of property, plant and equipment | 12 | - | - | |||||||||||
| Purchase of property, plant and equipment | 12 | ( | ) | ( | ) | ( | ) | |||||||
| Investment in capital projects | 13 | ( | ) | ( | ) | ( | ) | |||||||
| Purchase of other investments | 16 | ( | ) | - | - | |||||||||
| Acquisitions - consideration | 14 | ( | ) | - | - | |||||||||
| Acquisitions - cash acquired | 14 | - | - | |||||||||||
| Net cash used in investing activities | ( | ) | ( | ) | ( | ) | ||||||||
| Cash flows from financing activities | ||||||||||||||
| Lease repayments | 26 | ( | ) | ( | ) | ( | ) | |||||||
| Proceeds from investor | 28 | - | ||||||||||||
| Capital raise proceeds | 27 | |||||||||||||
| Equity instruments and capital raise costs | 27 | - | - | - | ||||||||||
| Debtor finance borrowings/(repayments) | 26 | - | - | ( | ) | |||||||||
| Loans from related parties | 26 | ( | ) | ( | ) | |||||||||
| Repayment of loans from related parties | 26 | - | - | ( | ) | |||||||||
| Bank loan borrowings | 26 | - | - | ( | ) | |||||||||
| Chattel mortgage borrowings | 26 | - | - | ( | ) | |||||||||
| Transfer from/(to) restricted cash | 18 | |||||||||||||
| Net cash from financing activities | ||||||||||||||
| Net (decrease)/increase in cash and cash equivalents | ( | ) | ( | ) | ||||||||||
| Cash and cash equivalents at the beginning of the year | 17 | |||||||||||||
| Effect of exchange rate movements on cash held | - | - | - | |||||||||||
| Cash and cash equivalents at the end of the year | 17 | |||||||||||||
See notes to financial statements
| F-9 |
| Table of Contents |
Consolidated Statements of Changes in Equity (Deficit)
| (US dollars
in thousands) | Share capital | Share premium | Shares subscription equity reserve | Cumulative translation reserve | Convertible preference shares | Other reserves | Accumulated deficit | Total | ||||||||||||||||||||||||
| At June 30, 2023 | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Loss for the year | - | - | - | - | - | - | ( | ) | ( | ) | ||||||||||||||||||||||
| Other comprehensive income/(expense) | - | - | - | ( | ) | - | - | ( | ) | |||||||||||||||||||||||
| Increase in equity before transaction with owners in their capacity of owners, equity | - | - | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||
| Transactions with owners in their capacity as owners | ||||||||||||||||||||||||||||||||
| Equity instruments | - | - | - | - | - | - | ||||||||||||||||||||||||||
| Other issuances | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||
| Capital raises | - | - | - | ( | ) | - | ||||||||||||||||||||||||||
| Employee share awards | - | - | - | - | ||||||||||||||||||||||||||||
| Non-controlling interest | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||
| Increase in equity before transaction with owners in their capacity of owners | - | - | - | - | ||||||||||||||||||||||||||||
| At June 30, 2024 | - | - | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||
| Loss for the year | - | - | - | - | - | - | ( | ) | ( | ) | ||||||||||||||||||||||
| Other comprehensive income/(expense) | - | - | - | ( | ) | - | ( | ) | - | ( | ) | |||||||||||||||||||||
| Increase in equity before transaction with owners in their capacity of owners, equity | - | ( | ) | - | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||
| Transactions with owners in their capacity as owners | ||||||||||||||||||||||||||||||||
| Equity instruments | - | - | - | - | - | |||||||||||||||||||||||||||
| Other issuances | - | - | - | - | ||||||||||||||||||||||||||||
| Capital raises | - | - | ( | ) | - | |||||||||||||||||||||||||||
| Employee share awards | - | - | - | - | - | - | ||||||||||||||||||||||||||
| Non-controlling interest | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||
| Increase in equity before transaction with owners in their capacity of owners | - | - | ( | ) | - | |||||||||||||||||||||||||||
| At June 30, 2025*restated | ( | ) | - | ( | ) | ( | ) | |||||||||||||||||||||||||
| Balance | ( | ) | - | ( | ) | ( | ) | |||||||||||||||||||||||||
| Loss for the year | - | - | - | - | - | - | ( | ) | ( | ) | ||||||||||||||||||||||
| Adjustments to b/f | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||
| Other comprehensive income/(expense) | - | - | - | - | - | - | ||||||||||||||||||||||||||
| Increase in equity before transaction with owners in their capacity of owners, equity | ( | ) | - | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||
| Transactions with owners in their capacity as owners | ||||||||||||||||||||||||||||||||
| Equity instruments | - | - | - | |||||||||||||||||||||||||||||
| Other issuances | - | - | - | - | ||||||||||||||||||||||||||||
| Transfers/derecognition | - | - | - | - | ( | ) | - | ( | ) | |||||||||||||||||||||||
| Dividend reserve | - | - | - | - | - | - | ||||||||||||||||||||||||||
| Warrant Reserve | - | - | - | - | - | - | ||||||||||||||||||||||||||
| Capital raises | - | - | - | ( | ) | - | ||||||||||||||||||||||||||
| Employee share awards | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||
| Increase in equity before transaction with owners in their capacity of owners | - | ( | ) | - | ||||||||||||||||||||||||||||
| At June 30, 2026 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Balance | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
For further information on “Other Reserves” please see Note 28.
| F-10 |
| Table of Contents |
Notes to Consolidated Financial Statements
As of and for the Years Ended June 30, 2026, 2025 and 2024
1. Reporting entity
VivoPower PLC (formerly VivoPower International PLC) (“VivoPower” or the “Company”) is a public limited company incorporated and domiciled in England and Wales. The address of the Company’s registered office is Suite 4, 7th Floor, 50 Broadway, London SW1H 0DB, United Kingdom.
The
consolidated financial statements (“financial statements”) comprise the financial statements of the Company and its subsidiaries
(together referred to as the “Group” and individually as “Group entities”). Since June 30, 2021, the Company
no longer has an ultimate controlling party, as AWN Holdings Limited (collectively with its affiliates and subsidiaries, “AWN”)
holds less than
2. Significant accounting policies
The
principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently
applied to all periods presented, unless otherwise stated. In October 2023, the company implemented a
2.1 Basis of preparation
VivoPower PLC’s consolidated financial statements were prepared in accordance with International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board and IFRIC interpretations applicable to companies reporting under IFRS. The consolidated financial statements have been prepared under the historical cost convention, except for certain financial assets and financial liabilities and when accounting for acquisitions, whereby fair values have been applied.
The preparation of financial statements with adopted IFRS requires the use of critical accounting estimates. It also requires the management to exercise judgement in the process of applying the Company’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where the assumptions and estimates are significant to the financial statements are disclosed in Note 3.
All financial information presented in US dollars has been rounded to the nearest thousand.
GOING CONCERN
The Directors have assessed the Group’s ability to continue as a going concern for a period of at least twelve months from the reporting date, which in practice has been considered through June 30 2027. The assessment considered solvency, liquidity and the Group’s sources of financing, and included whether any events or conditions cast significant doubt on the Group’s ability to continue as a going concern. The Directors have concluded that no material uncertainty exists and have therefore prepared the financial statements on a going concern basis.
Capital raised and debt retired
Since
June 30 2025 the Group has raised approximately US$
Despite
periods of constrained liquidity and challenging capital markets, the Group has continued to access capital, raising approximately US$
| F-11 |
| Table of Contents |
Financial position at June 30 2026
At
30 June 2026 the Group held cash of US$
Current liabilities include a warrant derivative
liability of US$
Total
borrowings were US$
Subscription receivables
Under
the Regulation S placement, a consortium led by Ceres Holding Limited committed to subscribe for
Payment of the balance has been delayed as a result of the conflict in the Middle East, where the consortium is based. The receivable is unsecured and is subject to the expected credit loss requirements of IFRS 9. The Group has considered the collectability and timing of this receivable separately in its liquidity assessment and has not relied solely on the reported working capital position in reaching its going concern conclusion.
Cash forecast and budget
The
Board has approved FY27 budgets for Tembo and for VivoPower, including VivoPower Arctic (the Mo i Rana facility). The budgets were prepared
bottom-up by the operating teams, consolidated by Group finance, and reviewed by an management before being presented to the Board.
Funding sources and commitments
The forecast reflects the following, in addition to operating cash flows:
| ● | the remaining Regulation S subscription proceeds; | |
| ● | the remaining US$ | |
| ● | under the TAG advance subscription
agreement for Tembo (US$ | |
| ● | TAG loans of US$ | |
| ● |
The
Group is finalizing an agreement with an AI tenant for the Mo i Rana site, which is expected, if signed, to include prepaid rent and
an investment in VivoPower by the tenant. This is not included in the going concern forecast. Tembo’s planned business combination
with Cactus Acquisition Corp. 1 Limited, which would bring strategic funding of up to US$
| F-12 |
| Table of Contents |
Mitigating actions
If any material cash inflow does not arrive as forecast, the Directors may reschedule operating activity, delay Tembo growth expenditure, phase the Mo i Rana buildout to align with confirmed tenant commitments and financing, match growth expenditure to financing inflows, manage supplier payment timing, reduce overheads, and raise additional equity or debt capital.
Conclusion
Based
on this assessment, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence
for at least twelve months from the reporting date, and that no material uncertainty exists in relation to
going concern. The Group’s greatest strength is its proven track record of raising capital, including in difficult market conditions,
having raised approximately US$
2.2 Basis of consolidation
The consolidated financial statements include those of VivoPower PLC and all of its subsidiary undertakings.
Subsidiary undertakings are those entities controlled directly or indirectly by the Company. The Company controls an investee 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. The results of the subsidiaries acquired are included in the Consolidated Statements of Comprehensive Loss from the date of acquisition using the same accounting policies of those of the Group. All business combinations are accounted for using the purchase method. The consideration transferred in a business combination is the fair value at the acquisition date of the assets transferred and the liabilities incurred by the Group and includes the fair value of any contingent consideration arrangement. Acquisition-related costs are recognized in the income statement as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair value at the acquisition date.
Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies in line with those used by other members of the Group.
All intra-group balances and transactions, including any unrealized income and expense arising from intra-group transactions, are eliminated in full in preparing the consolidated financial statements. Unrealized gains arising from transactions with equity accounted investees are eliminated against the investment to the extent of the Group’s interest in the investee. Unrealized losses are eliminated in the same way as unrealized gains, but only to the extent that there is no evidence of impairment.
Capital Management
The Group’s objectives when managing capital are to support its ability to continue as a going concern, meet its financial obligations and finance its operating and investment activities. The Group manages its funding through a combination of equity, shareholder loans and other financing arrangements. Management reviews forecast cash flows, available cash resources, debt maturities and anticipated funding requirements to identify financing needs and determine appropriate actions. These actions may include raising equity or debt, refinancing or settling existing obligations, and monetizing investments or other assets. The Board has overall responsibility for oversight of the Group’s financial risk management framework, with policies implemented centrally by the finance department.
The principal components of the Group’s capital and financing position were as follows:
Schedule of group capital and financing position
| US dollars in thousands | June 30, 2026 | June 30, 2025, restated | June 30, 2024 | ||||||||
| Total equity / (deficit) | ( |
) | |||||||||
| Loans and borrowings | |||||||||||
| Lease liabilities | — | ||||||||||
During the year, the Group’s financing activities included the issuance of ordinary shares, convertible preference shares and warrants. Total equity increased principally through these issuances and other equity movements, partially offset by the loss for the year. Lease liabilities increased principally as a result of the acquisition of the Norwegian data center business. The Group’s funding priorities developed during the year to support its transition toward digital infrastructure while continuing to address existing corporate obligations.
Subsequent
to June 30, 2026, the Group retired approximately $
The Group’s financing arrangements include security, repayment and mandatory prepayment provisions, including provisions triggered by qualifying liquidity events. These terms are considered when assessing available funding and the use of financing proceeds. Restrictions on distributions from subsidiaries may also affect the availability of funds at the parent company level. Further information on financing terms, equity transactions, liquidity management and subsequent financing activities is provided in Notes 26, 27, 31, 32 and 33.
2.3 Business combination
The acquisition method of accounting is used to account for all business combinations, regardless of whether equity instruments or other assets are acquired. The consideration transferred for the acquisition of a subsidiary comprises the:
| ● | fair values of the assets transferred | |
| ● | liabilities incurred to the former owners of the acquired businesses | |
| ● | equity interests issued by the Company | |
| ● | fair value of any asset or liability resulting from a contingent consideration arrangement, and | |
| ● | fair value of any pre-existing equity interest in the subsidiary. |
| F-13 |
| Table of Contents |
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with limited exceptions, measured initially at their fair values at the acquisition date. The Group recognizes any non-controlling interest in the acquired entity on an acquisition-by-acquisition basis either at fair value or at the non-controlling interest’s proportionate share of the acquired entity’s net identifiable assets. Acquisition-related costs are expenses as incurred.
The excess of the:
| ● | consideration transferred | |
| ● | amount of any non-controlling interest in the acquired entity, and | |
| ● | acquisition-date fair value of any previous equity interest in the acquired entity |
over the fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of the net identifiable assets of the business acquired, the difference is recognized directly in profit or loss as a bargain purchase.
Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present value as at the date of exchange. The discount rate used is the entity’s incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an independent financier under comparable terms and conditions.
Contingent consideration is classified either as equity or a financial liability. Amounts classified as a financial liability are subsequently remeasured to fair value, with changes in fair value recognized in profit or loss.
If the business combination is achieved in stages, the acquisition date carrying value of the acquirer’s previously held equity interest in the acquiree is remeasured to fair value at the acquisition date. Any gains or losses arising from such remeasurement are recognized in profit or loss.
2.4 Intangible assets
Intangible assets, other than goodwill, are initially recognized at cost. Following initial recognition, intangible assets are carried at cost less accumulated amortization and any accumulated impairment losses. Amortization is recognized on a systematic basis over the estimated useful lives of finite-life intangible assets from the date they are available for use. Internally generated development expenditure is capitalized only where the recognition criteria of IAS 38 are met.
Goodwill
Goodwill arising on a business combination is initially measured at cost, being the excess of the consideration transferred over the Group’s interest in the identifiable net assets acquired, and is subsequently carried at cost less accumulated impairment losses. Goodwill is not amortized but is tested for impairment annually and whenever indicators of impairment exist. Any gain arising from a bargain purchase is recognized immediately in profit or loss
Goodwill arose on the effective acquisition of VivoPower Pty Ltd, Aevitas O Holdings Limited (“Aevitas”), Tembo e-LV B.V, Cromwell AS and Nordland Data AS. Goodwill is reviewed annually to test for impairment.
Other intangible assets
Intangible assets acquired through a business combination are initially measured at fair value and then amortized over their useful economic lives. Subsequent expenditure is capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates.
Capitalized development costs are initially measured at the directly attributable costs incurred in developing the asset and are subsequently carried at cost less accumulated amortization and impairment losses.
Development expenditure includes the product development project for ruggedized electric vehicles in Tembo, pre-series-production expenditure on developing vehicle specifications and production processes. Capitalized costs include primarily internal payroll costs, external consultants and computer software.
| F-14 |
| Table of Contents |
Development expenditure on U.S. solar projects includes securing land rights, completing feasibility studies, negotiating power purchase agreements, and other costs incurred to prepare project sales for Notice to Proceed with construction and hence sale to a partner as a shovel ready project.
For both electric vehicles product development project, and U.S. solar development projects, it is the Company’s intention to complete the projects. It expects to obtain adequate technical, financial and other resources to complete the projects, and management consider that it is probable for the future economic benefits attributable to the development expenditure to flow to the entity; and that the cost of the asset can be measured reliably. Accordingly, the development expenditure is recognized under IAS 38 – Intangible Assets as an intangible asset.
All other expenditure, including expenditure on internally generated goodwill and brands, and research costs, are recognized in profit or loss as incurred.
Amortization is calculated on a straight-line basis to write down the assets over their useful economic lives at the following rates:
Schedule of intangible asset over useful economic lives
| ● | Development expenditure - | |
| ● | Customer relationships – | |
| ● | Trade names – | |
| ● | Favorable supply contracts – | |
| ● | Other – |
2.5 Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation and any accumulated impairment losses. The cost of an item of property, plant and equipment comprises its purchase price and the costs directly attributable to bringing the asset into use.
When parts of an item of property, plant and equipment have different useful lives, they are accounted as separate items (major components) of property, plant and equipment.
Depreciation is calculated on a straight-line basis so as to write down the assets to their estimated residual value over their useful economic lives at the following rates:
Schedule of estimated useful life of property plant and equipment
| ● | Computer equipment - | |
| ● | Fixtures and fittings -
| |
| ● | Motor vehicles - | |
| ● | Plant and equipment –
| |
| ● | Right-of-use assets –
|
2.6 Assets classified as held for sale and discontinued operations
Assets are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use and a sale is considered highly probable. They are measured at the lower of their carrying value and fair value less costs to sell. An impairment loss is recognized for any subsequent write-down of the asset to fair value less costs to sell.
A discontinued operation is a component of the Company that has been disposed of or is classified as held for sale and represents a separate major line of business or geographical area of operations. The results of discontinued operations are presented separately in the Statements of Comprehensive Loss
| F-15 |
| Table of Contents |
2.7 Inventory
Inventories are stated at the lower of cost and net realizable value, in accordance with IAS 2 – Inventories. The cost includes all direct and indirect variable production expenses, plus fixed expenses based on the normal capacity of each production facility. The net realizable value of inventories intended to be sold corresponds to their selling price, as estimated based on market conditions and any relevant external information sources, less the estimated costs necessary to complete the sale.
2.8 Leases
The
Group leased offices, workshops, motor vehicles, and equipment for fixed periods of
The Group also leases land in Norway for data-center operations under agreements with initial terms of up to 50 years.
Contracts could contain both lease and non-lease components. The Group allocated the consideration in the contract to the lease and non-lease components based on their relative stand-alone prices. However, for leases of real estate for which the Group is a lessee, it elected not to separate lease and non-lease components and instead accounts for these as a single lease component.
Lease terms were negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose any covenants other than the security interests in the leased assets that are held by the lessor. Leased assets were not be used as security for borrowing purposes.
Leases were recognized as a right-of-use asset and a corresponding liability at the date at which the leased asset is available for use by the Group.
Assets and liabilities arising from a lease were initially measured on a present value basis, with lease payments discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, the Group’s incremental borrowing rate is used. The Group presents lease liabilities in loans and borrowings in the Consolidated Statement of Financial Position.
Lease payments were allocated between principal and finance cost. The finance cost is charged to the Consolidated Statements of Comprehensive Loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.
Right-of-use assets are presented in property, plant and equipment and depreciated over the shorter of the asset’s useful life and the lease term on a straight-line basis.
2.9 Impairment of non-financial assets
Goodwill is allocated to cash-generating units for the purposes of impairment testing. The recoverable amount of the cash-generating unit (CGU’) to which the goodwill relates is tested annually for impairment or when events or changes to circumstances indicate that it might be impaired.
The carrying values of property, plant and equipment, investments and intangible assets other than goodwill are reviewed for impairment only when events indicate the carrying value may be impaired.
In an impairment test the recoverable amount of the cash-generating unit or asset is estimated in order to determine the existence or extent of any impairment loss. The recoverable amount is the higher of fair value less costs to sell and the value in use to the Group. An impairment loss is recognized to the extent that the carrying value exceeds the recoverable amount. In determining a cash-generating unit’s or asset’s value in use, 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 risks specific to the cash-generating unit or asset that have not already been included in the estimate of future cash flows. All impairment losses are recognized in the Statements of Comprehensive Loss.
An
impairment loss in respect of goodwill is not reversed. In the case of other assets, impairment losses recognized in prior periods are
assessed at each reporting date for any indications that the loss has decreased or no longer exists. These impairment losses are reversed
if there has been any change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent
that the asset’s carrying amount does not exceed the carrying value that would have been determined, net of depreciation or amortization,
if
| F-16 |
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2.10 Financial instruments
Financial assets and liabilities are recognized in the Group’s Statements of Financial Position when the Group becomes a party to the contracted provision of the instrument. The following policies for financial instruments have been applied in the preparation of the financial statements.
The Company classifies its financial assets in the following measurement categories:
| ● | those to be measured subsequently at fair value through profit or loss; and, | |
| ● | those to be measured at amortized cost. |
The classification depends on the business model for managing the financial assets and the contractual terms of the cash flows. Financial assets are classified as an amortized cost only if both of the following criteria are met:
| ● | the asset is held within a business model whose objective is to collect contractual cash flows; and, | |
| ● | the contractual terms give rise to cash flows that are solely payments of principal and interest. |
Financial assets and financial liabilities are initially measured at fair value, adjusted for directly attributable transaction costs, except for instruments measured at fair value through profit or loss, for which transaction costs are expensed as incurred. Trade receivables that do not contain a significant financing component are initially measured at their transaction price.
Financial assets classified at amortized cost are subsequently measured using the effective interest method, less any allowance for expected credit losses. Interest income, impairment gains or losses and gains or losses arising on derecognition are recognized in profit or loss.
Financial assets classified at fair value through profit or loss, including the Group’s listed and unlisted equity investments, are subsequently remeasured at fair value at each reporting date. Changes in fair value are recognized in profit or loss.
Financial liabilities, other than those measured at fair value through profit or loss, are subsequently measured at amortized cost using the effective interest method. Interest expense and gains or losses arising on derecognition are recognized in profit or loss.
Derivative financial instruments, including warrants classified as financial liabilities under IAS 32, are initially recognized at fair value and subsequently remeasured at fair value at each reporting date, with changes recognized in profit or loss. Equity-classified warrants are recognized within equity and are not subsequently remeasured.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:
| ● | in the principal market for the asset or liability; or, | |
| ● | in the absence of a principal market, in the most advantageous market for the asset or liability. |
The principal or the most advantageous market must be accessible by the Group. The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.
Advance subscription arrangements are classified according to the substance of their contractual terms. Where an arrangement requires the issue of a fixed number of the Group’s own equity instruments in exchange for a fixed amount of consideration, with no contractual obligation to deliver cash or another financial asset, the arrangement is classified as an equity instrument. Where an unconditional and enforceable contractual right to receive the subscription consideration exists at the reporting date, the corresponding subscription receivable is recognized as a financial asset, with the corresponding amount recognized within a separate equity reserve until the underlying shares are legally issued.
Advance subscription arrangements that do not qualify for equity classification under IAS 32 are classified as financial liabilities and measured in accordance with IFRS 9.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
Level 1 - quoted (unadjusted) market prices in active markets for identical assets or liabilities;
Level 2 - valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable; and
Level 3 - valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.
Further information regarding the Group’s financial instruments and fair value measurements is provided in Note 31.
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Cash and cash equivalents and other non-cash items
For the purpose of preparation of the Consolidated Statements of Cash Flow, cash and cash equivalents includes cash at bank and in hand.
During the year ended June 30, 2026, we entered into the following investing and financing transactions that did not require the use of cash or cash equivalents. They are excluded from the consolidated statement of cash flows. Only the cash portion of transactions that were partly cash and partly non-cash is included in that statement.
(a) Business combination
In the acquisition of VivoPower Norge Infrastructure AS (formerly Cromwell AS) on May 12, 2026, the following consideration
was non-cash: deferred cash payments of US$
(b) Equity subscription receivable
Subscription arrangements of US$
(c) Convertible preference shares
We issued
(d) Warrants
We issued warrants with a fair value of US$
(e) Leases
We recognized right-of-use assets and lease liabilities of US$
(f) Capital raising settled from proceeds
Consulting services of US$
Restricted cash
Restricted cash are cash and cash equivalents whose availability for use within the Group is subject to certain restrictions by third parties.
Bank borrowings
Interest-bearing bank loans are initially recognized at fair value, net of directly attributable transaction costs. They are subsequently measured at amortized cost using the effective interest method. Any difference between the initial carrying amount and the redemption amount, together with directly attributable transaction costs, is recognized in profit or loss over the term of the borrowing using the effective interest rate.
Trade and other receivables
Trade and other receivables are recognized initially at fair value and subsequently measured at amortized cost using the effective interest method, less any allowance for the expected future issue of credit notes and for non-recoverability due to credit risk. The Group applies the IFRS 9 – Financial Instruments simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all trade receivables and contract assets. To measure expected credit losses, trade receivables and contract assets have been grouped based on shared risk characteristics.
Trade and other payables
Trade and other payables are non-interest bearing and are stated at amortized cost using the effective interest method.
Share capital
Class
A Ordinary Shares, nominal value $
Repurchase of share capital (treasury shares)
When share capital recognized as equity is repurchased as equity by the Company the amount of the consideration paid, which includes directly attributable costs, net of any tax effects, is recognized as a deduction from equity, and excluded from the number of shares in issue when calculating loss per share.
2.11 Taxation
Income tax expense comprises current and deferred tax.
Current tax is recognized based on the amounts expected to be paid or recovered under the tax rates and laws that have been enacted or substantively enacted by the end of the reporting period.
Deferred tax is provided on temporary timing differences that arise between the carrying amounts of assets and liabilities for financial reporting purposes and their corresponding tax values. Liabilities are recorded on all temporary differences except in respect of initial recognition of goodwill and in respect of investments in subsidiaries where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that it will not reverse in the foreseeable future. Deferred tax assets are recognized to the extent that it is probable that future taxable profits will be available against which the asset can be offset. Deferred tax is measured on an undiscounted basis using the tax rates and laws that have been enacted or substantively enacted by the end of the accounting period.
Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax assets and liabilities, they relate to income taxes levied by the same tax authority and the Group intends to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realized simultaneously.
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Current and deferred tax are recognized in the Statements of Comprehensive Loss, except when the tax relates to items charged or credited directly to equity, in which case it is dealt with directly in equity.
2.12 Provisions
Provisions are recognized when the Group has a present obligation because of a past event, it is probable that the Group will be required to settle that obligation, and it can be measured reliably.
Provisions are measured at the directors’ best estimate of the expenditure required to settle the obligation at the date of Statement of Financial Position.
Where the time value of money is material, provisions are measured at the present value of expenditures expected to be paid in settlement.
2.13 Loss per share
The Group presents basic and diluted loss per share (“EPS”) data for Class A Ordinary Shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of Class A Ordinary Shares, excluding the shares held as treasury shares. Currently there are no diluting effects on EPS for Class A Ordinary Shares, therefore, diluted EPS is the same as basic EPS.
2.14 Foreign currencies
The Company’s functional and presentational currency is the US dollar. Items included in the separate financial statements of each Group entity are measured in the functional currency of that entity. Transactions denominated in foreign currencies are translated into the functional currency of the entity at the rates of exchange prevailing at the dates of the individual transactions. Foreign currency monetary assets and liabilities are translated at the rates of exchange prevailing at the end of the reporting period.
Exchange gains and losses arising are charged to the Statements of Comprehensive Loss within finance income or expenses. The Statements of Comprehensive Loss and Statement of Financial Position of foreign entities are translated into US dollars on consolidation at the average rates for the period and the rates prevailing at the end of the reporting period respectively. Exchange gains and losses arising on the translation of the Group’s net investment foreign entities are recognized as a separate component of shareholders’ equity.
Foreign currency denominated share capital and related share premium and reserve accounts are recorded at the historical exchange rate at the time the shares were issued, or the equity created.
2.15 Revenue from contracts with customers
Revenue is recognized in accordance with IFRS 15 when control of the promised goods or services is transferred to the customer, in an amount that reflects the consideration to which the Group expects to be entitled. Revenue is presented net of discounts and indirect taxes. For the revenue streams generated in FY2026, FY2025 and FY 2024, revenue is recognized at the point in time/overtime when the relevant goods or services are delivered and the associated performance obligation has been satisfied.
The Group has elected to apply the practical expedients under IFRS 15.121 and accordingly omits disclosure of the transaction price allocated to remaining performance obligations for contracts with an original expected duration of one year or less and for performance obligations where revenue is recognized at the amount the Group has a right to invoice, because that amount corresponds directly to the value to the customer of performance completed to date.
Revenue comprises the fair value of the consideration received or receivable from the provision of services in the ordinary course of the Group’s activities, including revenue earned in Bitcoin. Revenue is shown net of discounts, value-added tax and other sales-related taxes, and after the elimination of sales within the Group.
Revenue comprises development revenues, electrical installations, electrical servicing and maintenance, generator sales, vehicle spec conversion, conversion kits and bitcoin revenue. Revenue is recognized upon satisfaction of contractual performance obligations.
The Group has a number of different revenue streams and the key components in determining the correct recognition are as follows:
Development revenue, which is revenue generated from development services relating to the building and construction of solar projects, is recognized on a percentage completion basis as the value is accrued by the end user over the life of the contract. The periodic recognition is calculated through weekly project progress reports.
| F-19 |
| Table of Contents |
On longer-term power services projects such as large-scale equipment provision and installation, the performance obligation of completing the installation is satisfied over time, and revenue is recognized on a percentage completion basis using an input method. Revenue for stand-alone equipment sales is recognized at the point of passing control of the asset to the customer. Other revenue for small jobs and those completed in a limited timeframe are recognized when the job is complete and accepted by the customer.
Revenue for sale of electric vehicles, kits for electric vehicles and related products is recognized upon delivery to the customer. Where distribution agreements are agreed with external parties to participate in the assembly of vehicles, revenue recognition will be assessed under IFRS 15 - Revenue from Contracts with Customers, to establish the principal and agent in the relationship between the parties and with the end customer.
Warranties are of short duration and only cover defective workmanship and defective materials. No additional services are committed to which generate a performance obligation.
No adjustment is made for the effects of financing, as the Company expects, at contract inception, that the period between when the goods and services are transferred to the customer and when the customer pays, will be one year or less.
If the revenue recognized for goods and services rendered by the Company exceeds amounts that the Company is entitled to bill the customer, a contract asset is recognized. If amounts billed exceed the revenue recognized for goods and services rendered, a contract liability is recognized.
Incremental costs of obtaining a contract are expensed as incurred.
Data center and hosting services
Revenue from data center and hosting services is recognized over time as the services are provided because the customer simultaneously receives and consumes the benefits of the Group’s performance. Revenue is measured based on the contractual consideration attributable to the services provided during the relevant period, including, where applicable, contracted capacity, power consumption, hosting charges and other usage-based charges.
Where consideration includes variable amounts, such amounts are included in the transaction price only to the extent that it is highly probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved.
Amounts billed in advance of the provision of services are recognized as contract liabilities and recognized as revenue as the related services are provided. Amounts earned but not yet billed are recognized as contract assets or receivables, as appropriate.
Bitcoin revenue
The Group provides data center hosting, electricity, infrastructure and maintenance services to third-party customers engaged in Bitcoin mining activities. The Group does not directly undertake Bitcoin mining activities. Instead, under contractual arrangements with mining operators, the Group is entitled to receive a share of the computing power generated by the mining equipment hosted at its facilities, which results in the receipt of Bitcoin as consideration for the services provided.
Revenue from these arrangements is recognized in accordance with IFRS 15 Revenue from Contracts with Customers, as the Group satisfies its performance obligations by providing hosting and related services over time. Bitcoin received as non-cash consideration is measured at its fair value at the applicable revenue recognition date, determined using observable market prices from recognized cryptocurrency exchanges or other reliable pricing sources.
Bitcoin received is initially held in a digital wallet controlled by the Group or another Group entity on its behalf and is subsequently sold in the open market at prevailing market prices. The cash proceeds from the sale are deposited into the Group’s bank accounts. The subsequent conversion of Bitcoin into fiat currency does not result in additional revenue. Any difference between the initial carrying amount of Bitcoin and the proceeds received upon disposal is recognized separately in profit or loss in accordance with the Group’s accounting policy for digital assets.
At the reporting date, the Group held no Bitcoin balances in its digital wallets, as all Bitcoin received had been converted into fiat currency. Accordingly, no digital assets were recognized in the consolidated statement of financial position at year-end. Where Bitcoin remains unsold at a future reporting date, such holdings will be recognized as digital assets and subsequently measured in accordance with the applicable IFRS requirements, including IAS 2 Inventories or IAS 38 Intangible Assets, depending on the nature and purpose of the holdings.
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2.16 Other income
Other income comprises amounts that do not arise from the Group’s principal operating activities and primarily includes gains arising from the write-back of financial liabilities. Such gains are recognised in profit or loss only when the underlying contractual obligation has been discharged, cancelled or has expired.
2.17 Other gains
Other gains comprise the net income or expense arising from Deeds of Company Arrangement (“DOCAs”) entered into in respect of certain of the Group’s Australian entities. The net gain or loss on a DOCA is recognized in profit or loss in the period in which the DOCA becomes effective and the related transactions are completed. It reflects the extinguishment of liabilities, any associated costs, recoveries and other effects of the arrangement, net of related expenses.
2.18 Employee benefits
Pension
The employer pension contributions are associated with defined contribution schemes. The costs are therefore recognized in the month in which the contribution is incurred, which is consistent with recognition of payroll expenses.
Short-term benefits
Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided.
A liability is recognized for the amount expected to be paid under short-term cash bonus or profit-sharing plans if the Group has a present legal or constructive obligation to pay this amount because of past service provided by the employee and the obligation can be reliably measured.
Short-term compensated absences
A liability for short-term compensated absences, such as holidays, is recognized for the amount the Group may be required to pay because of the unused entitlement that has accumulated at the end of the reporting period.
Share-based payments
Shares issued to employees and other participants under the Omnibus Incentive Plan 2017 are recognized over the expected vesting period, using the grant date share price, in accordance with IFRS 2 Share-based Payments.
2.19 Restructuring and other non-recurring costs
Restructuring and other non-recurring costs are by nature one-time incurrences and do not represent the normal trading activities of the business and accordingly are disclosed separately on the Consolidated Statements of Comprehensive Loss in accordance with IAS 1 – Presentation of Financial Statements in order to draw them to the attention of the reader of the financial statements. Restructuring costs are defined in accordance with IAS 37 – Provisions, Contingent Liabilities and Contingent Assets as being related to sale or termination of a line of business, closure of business locations, changes in management structure, or fundamental reorganizations.
Other non-recurring costs include litigation expenses for former employees, including fees for legal services and provisions under IAS 37 for legal fee dispute resolutions that are probable to result in a quantifiable financial outflow by the Company.
Other non-recurring costs also include provisions created for the recoverability of UK input taxes claimed in prior years.
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2.20 New standards, amendments and interpretations
The following amendments to IFRS Accounting Standards have been issued but are not yet effective for the Group’s annual reporting period ended June 30, 2026:
Amendments to the Classification and Measurement of Financial Instruments (Amendments to IFRS 9 and IFRS 7):
The amendments are effective for annual reporting periods beginning on or after January 1, 2026, with earlier application permitted. Accordingly, the amendments will apply to the Group for the annual reporting period beginning July 1, 2026. The Group has not early adopted the amendments and is currently assessing their impact on its consolidated financial statements.
Contracts Referencing Nature-dependent Electricity (Amendments to IFRS 9 and IFRS 7):
The amendments are effective for annual reporting periods beginning on or after January 1, 2026, with earlier application permitted. Accordingly, the amendments will apply to the Group for the annual reporting period beginning July 1, 2026. The Group has not early adopted the amendments and is currently assessing their impact on its consolidated financial statements.
Annual Improvements to IFRS Accounting Standards, Volume 11:
The amendments are effective for annual reporting periods beginning on or after January 1, 2026, with earlier application permitted. Accordingly, the amendments will apply to the Group for the annual reporting period beginning July 1, 2026. The Group has not early adopted the amendments and is currently assessing their impact on its consolidated financial statements.
The January 1, 2026 effective dates above are supported by the IFRS Foundation.
The Directors do not expect that the adoption of the standards listed above will have a material impact on the financial statements of the Group or Company in future periods.
3. Significant accounting judgements and estimates
In preparing the consolidated financial statements, the directors are required to make judgements in applying the Group’s accounting policies and in making estimates and making assumptions about the future. These estimates could have a significant risk of causing a material adjustment to the carrying value of assets and liabilities in the future financial periods. The critical judgements that have been made in arriving at the amounts recognized in the consolidated financial statements are discussed below.
| 3.1 | Revenue from contracts with customers – determining the timing of satisfaction of services |
Revenue from the sale of electric vehicles, conversion kits and related products is recognized at a point in time when control transfers to the customer, generally upon delivery, subject to the relevant contractual terms.
Revenue from data center hosting and related services is recognized over time as the services are provided and the customer simultaneously receives and consumes the benefits. Recognition is based on the services delivered during the relevant period and does not involve a percentage-of-completion assessment.
Contract balances
Contract assets represent conditional rights to consideration for goods or services transferred to customers, while contract liabilities represent consideration received or due before the related performance obligations are satisfied.
Trade
receivables are disclosed in Note 19. Contract assets amounted to US$
Revenue
recognized from opening contract liabilities amounted to $
| 3.2 | Impairment of non-financial assets |
The assessment of impairment of non-financial assets involves significant judgement in identifying whether indicators of impairment exist and, where required, estimating the recoverable amount of the relevant asset or cash-generating unit (“CGU”).
Goodwill is tested annually for impairment or when events or changes to circumstances indicate that it might be impaired.
Where recoverable amount is determined using forecast cash flows, significant estimation uncertainty arises from assumptions including forecast revenues and margins, expected commercialization and growth, future funding requirements, discount rates and the timing of future cash flows. Changes in these assumptions could result in a materially different recoverable amount and impairment charge.
| F-22 |
| Table of Contents |
Impairment assessments require the use of estimates and assumptions. To assess impairment, 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 risks specific to the related cash-generating unit. Judgement was applied in making estimates and assumptions about the future cash flows, including the appropriateness of discounts rates applied and operating performance (which includes production and sales volumes), as further disclosed in Note 13. These estimates and assumptions are subject to risk and uncertainty. Therefore, there is a possibility that changes in circumstances will impact on these projections, which may impact on the recoverable amount of assets and/or CGUs.
Intangibles impaired during FY 2025 were for Caret leases abandoned or not renewed. Additionally, some of the tangible assets of Tembo EV Pty Ltd (Tembo EV) and Tembo 4x4 e-LV B.V. were assessed to be impaired by the end of the fiscal year.
No
impairment was charged during the financial year ended 2026 relating to intangibles and goodwill (2025: $
| 3.3 | Operating loss |
In preparing the consolidated financial statements of the Group, judgement was applied with respect to those items which are presented in the Consolidated Statements of Comprehensive Loss as included within operating profit/(loss). Those revenues and expenses which are determined to be specifically related to the on-going operating activities of the business are included within operating profit/(loss). Expenses or charges to earnings which are not related to operating activities are one-time costs determined to be not representative of the normal trading activities of the business, or that arise from revaluation of assets, are reported below operating profit/loss.
| 3.4 | Litigation provision |
The recognition and measurement of litigation provisions requires significant judgement in assessing whether a present obligation exists, the probability of an outflow of resources and the amount and timing of any potential settlement. Management’s assessment considers the nature and status of individual claims, available legal advice, correspondence with counterparties and developments up to the date of approval of the financial statements. Given the inherent uncertainty associated with legal proceedings, the ultimate outcome and settlement amount may differ from the amounts provided. Further details are set out in Note 24.
| 3.5 | Capitalization of product development costs |
The Group capitalizes qualifying product development expenditure within its EV segment. Significant judgement is required in determining whether the recognition criteria of IAS 38 have been met, including the technical feasibility of completing the development, management’s intention and ability to complete and use or sell the resulting product, the availability of adequate technical and financial resources, the probability of future economic benefits and the ability to reliably measure directly attributable expenditure. Judgement is also required in determining when a project has progressed from the research phase to the development phase and therefore when capitalization should commence, together with assessing which costs are directly attributable to qualifying development activities.
In
determining the amounts to be capitalized, management makes assumptions regarding the expected future cash generation, discount rates
to be applied and the expected period of benefits. As of June 30, 2026, the carrying amount of capitalized development costs were $
| 3.6 | Income taxes |
In recognizing income tax assets and liabilities, management makes estimates of the likely outcome of decisions by tax authorities on transactions and events whose treatment for tax purposes is uncertain. Where the outcome of such matters is different, or expected to be different, from previous assessments made by management, a change to the carrying value of the income tax assets and liabilities will be recorded in the period in which such determination is made. The carrying values of income tax assets and liabilities are disclosed separately in the Consolidated Statements of Financial Position.
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| Table of Contents |
| 3.7 | Deferred tax assets |
Deferred tax assets for unused
tax losses and other timing differences amounting to $
The recognition of deferred tax assets in respect of tax losses requires significant judgement and estimation in assessing whether sufficient future taxable profits will be available against which those losses can be utilized. In making this assessment, management considers the availability of taxable temporary differences, historical and forecast taxable performance, the timing of expected future taxable profits and any restrictions on the utilization of tax losses. At June 30, 2026, deferred tax assets arising from tax losses have been recognized only to the extent supported by corresponding taxable temporary differences and are fully offset against the related deferred tax liabilities. Accordingly, no net deferred tax asset arising from tax losses is recognized in the Consolidated Statement of Financial Position. No deferred tax asset has been recognized for the remaining tax losses where sufficient evidence of probable future taxable profits is not currently available. Management will reassess the recoverability of these losses as visibility over future taxable profits develops. Further details, including the Group’s unrecognized tax losses, are provided in Note 11.
At
the reporting date, the Group had unused tax losses of $
| 3.8 | Fair value measurement |
The fair values of financial assets and liabilities recorded in the consolidated statement of financial position are measured using valuation techniques including discounted cash flow (“DCF”) models. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. Changes in assumptions about these factors could affect the reported fair value. When the fair values of non-financial assets/Cash Generating Unit’s (CGU) need to be determined, for example in business combinations and for impairment testing purposes, they are measured using valuation techniques including the DCF model.
| 4 | Revenue and segmental information |
The Group determines and presents operating segments based on the information that is provided internally to the board of directors of the Company (the “Board”), which is the Group’s chief operating decision maker.
Management
analyzes our business in
The Critical Power Services segment, previously represented by VivoPower’s wholly owned subsidiary Aevitas and its subsidiaries KESW EL Pty Limited (“Kenshaw”) and Kenshaw Solar Pty Ltd (previously J.A. Martin) (“Aevitas Solar”), has been discontinued following the sale of Kenshaw to ARA Group Limited in July 2024. Accordingly, Critical Power Services is no longer considered an operating segment.
The Electric Vehicles segment is represented by Tembo e-LV B.V. (“Tembo”), a Netherlands-based specialist battery-electric and off-road vehicle company delivering electric vehicles (“EVs”) for mining and other rugged industrial customers globally. Tembo also includes Tembo EV Pty Ltd, which launched the Tembo Tusker electric pickup truck in Australia and New Zealand, and Tembo Technologies Pty Ltd, which is developing an all-electric Jeepney for the Philippines transport market. For the year ended June 30, 2026, no revenue was recognized from Tembo Technologies Pty Ltd.
The Data Center segment comprises the Group’s cryptocurrency mining and hosting operations in Norway. Cryptocurrency mining revenue arises from cryptocurrency rewards earned through mining activities.
Digital asset hosting revenue is generated from providing data center infrastructure and related operational services to customers for hosting cryptocurrency mining equipment.
The Sustainable Energy Solutions (“SES”) segment involves the design, evaluation, sale, and implementation of renewable energy infrastructure to customers, both on a standalone basis and in support of Tembo EVs.
The Solar Development segment is represented by Caret LLC (“Caret”) in the United States and comprises the Group’s solar development activities.
The Corporate Office segment represents the Company’s corporate functions, including costs to maintain its Nasdaq public company listing, compliance with SEC reporting requirements, and investor relations activities, and is located in the United Kingdom.
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| Table of Contents |
An operating segment is a component of the Group that engages in activities from which it may earn revenues and incur expenses, including any revenues and expenses that relate to the transactions with any of the Group’s other components. Operating segments results are reviewed regularly by the Board to assess its performance and make decisions about resources to be allocated to the segment, and for which discrete financial information is available.
Segment results that are reported to the Board include items directly attributable to a segment as well as those that can be allocated to a segment on a reasonable basis.
| 4.1 | Revenue |
Revenue from continuing operations by geographic location is as follows:
Schedule of geographical areas
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Australia | - | |||||||||||
| Netherlands | - | - | ||||||||||
| United States | - | - | ||||||||||
| Norway | - | - | ||||||||||
| Total revenues | ||||||||||||
Revenue by product and service is as follows:
Schedule of products and services
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Digital revenue | - | - | ||||||||||
| Vehicle spec conversion | - | |||||||||||
| Conversion kits | ||||||||||||
| Cryptocurrency mining revenue | - | - | ||||||||||
| Digital assets hosting revenue | - | - | ||||||||||
| Total revenues | ||||||||||||
More
than
| 4.2 | Operating segments |
| a) | Segment results of operations | |
| Certain continuing balances attributable to the legacy Critical Power Services segment are presented separately as residual continuing items and have not been reallocated to the Group’s six current reportable segments. |
Results of operations by reportable segment are as follows:
Schedule of operating segments
| Year ended June 30, 2026 (US dollars in thousands) | Critical Power Services | Solar Development | Electric Vehicles | Sustainable Energy Solutions | Corporate Office | Data Center | Total Continuing | Critical Power Services | Total | |||||||||||||||||||||||||||
| Continuing operations | Discontinued operations | |||||||||||||||||||||||||||||||||||
| Year ended June 30, 2026 (US dollars in thousands) | Critical Power Services | Solar Development | Electric Vehicles | Sustainable Energy Solutions | Corporate Office | Data Center | Total Continuing | Critical Power Services | Total | |||||||||||||||||||||||||||
| Revenue from contracts with customers | - | - | - | - | - | |||||||||||||||||||||||||||||||
| Costs of sales - other | - | - | ( | ) | - | - | ( | ) | ( | ) | - | ( | ) | |||||||||||||||||||||||
| Gross profit | - | - | - | - | - | |||||||||||||||||||||||||||||||
| General and administrative expenses | ( | ) | - | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | - | ( | ) | ||||||||||||||||||||
| Other gains | - | ( | ) | - | ||||||||||||||||||||||||||||||||
| Other income | - | - | - | - | - | |||||||||||||||||||||||||||||||
| Depreciation and amortization | - | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | - | ( | ) | ||||||||||||||||||||
| Operating loss | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Restructuring and other non-recurring costs | ( | ) | - | ( | ) | ( | ) | - | ( | ) | - | ( | ) | |||||||||||||||||||||||
| Impairment costs | - | - | ( | ) | - | ( | ) | - | ( | ) | - | ( | ) | |||||||||||||||||||||||
| Finance expense - net | ( | ) | - | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||
| Fair value loss on instruments | - | - | - | - | ( | ) | - | ( | ) | - | ( | ) | ||||||||||||||||||||||||
| Profit/(loss) before income tax | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Income tax | - | - | - | - | ( | ) | ( | ) | - | ( | ) | |||||||||||||||||||||||||
| Loss for the year | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
| F-25 |
| Table of Contents |
| Year
Ended June 30, 2025 *restated (US dollars in thousands) | Critical
Power Services | Solar Development | Electric Vehicles | Sustainable
Energy Solutions | Corporate Office | Digital Assets | Total Continuing | operations Critical Power | Total | |||||||||||||||||||||||||||
| Continuing operations | Discontinued operations | |||||||||||||||||||||||||||||||||||
| Year
Ended June 30, 2025 *restated (US dollars in thousands) | Critical
Power Services | Solar Development | Electric Vehicles | Sustainable
Energy Solutions | Corporate Office | Digital Assets | Total Continuing | Critical
Power | Total | |||||||||||||||||||||||||||
| Revenue from contracts with customers | - | - | - | - | - | |||||||||||||||||||||||||||||||
| Costs of sales - other | - | - | ( | ) | - | - | - | ( | ) | - | ( | ) | ||||||||||||||||||||||||
| Gross profit | - | - | - | - | - | |||||||||||||||||||||||||||||||
| General and administrative expenses | ( | ) | ( | ) | ( | ) | ( | ) | - | ( | ) | - | ( | ) | ||||||||||||||||||||||
| Other gains | - | - | - | - | - | - | ||||||||||||||||||||||||||||||
| Other income | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||
| Depreciation and amortization | - | - | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | - | ( | ) | |||||||||||||||||||||
| Operating loss | ( | ) | ( | ) | ( | )) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||
| Restructuring and other non-recurring costs | ( | ) | - | ( | ) | ( | ) | - | ( | ) | - | ( | ) | |||||||||||||||||||||||
| Impairment costs | - | ( | ) | ( | )) | - | - | - | ( | ) | - | ( | ) | |||||||||||||||||||||||
| Finance expense - net | ( | ) | - | ( | ) | ( | ) | - | ( | ) | - | ( | ) | |||||||||||||||||||||||
| Profit/(loss) before income tax | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||
| Income tax | - | - | - | - | - | |||||||||||||||||||||||||||||||
| Loss for the year | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||
| Year Ended June 30, 2024 (US dollars in thousands) | Critical Power Services | Solar Development | Electric Vehicles | Sustainable Energy Solutions | Corporate Office | Total Continuing | Critical Power Services | Total | ||||||||||||||||||||||||
| Continuing operations | Discontinued operations | |||||||||||||||||||||||||||||||
| Year Ended June 30, 2024 (US dollars in thousands) | Critical Power Services | Solar Development | Electric Vehicles | Sustainable Energy Solutions | Corporate Office | Total Continuing | Critical Power Services | Total | ||||||||||||||||||||||||
| Revenue from contracts with customers | - | - | - | - | ||||||||||||||||||||||||||||
| Costs of sales - other | ( | ) | - | ( | ) | - | ( | ) | ( | ) | ||||||||||||||||||||||
| Gross profit | ( | ) | - | ( | ) | - | ||||||||||||||||||||||||||
| General and administrative expenses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||
| Other gains | - | - | ||||||||||||||||||||||||||||||
| Other income | - | - | - | - | - | - | ||||||||||||||||||||||||||
| Depreciation and amortization | ( | ) | - | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||
| Operating loss | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||
| Restructuring and other non-recurring costs | - | - | - | - | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||
| Impairment losses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||
| Finance expense - net | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| Profit/(loss) before income tax | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||
| Income tax | ( | ) | - | ( | ) | - | ( | ) | - | ( | ) | |||||||||||||||||||||
| Loss for the year | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||
| F-26 |
| Table of Contents |
| b) | Segment net assets |
Net assets by reportable segment are as follows:
| As at June 30, 2026 | Critical Power | Solar | Electric | Sustainable Energy | Corporate | Data | ||||||||||||||||||||||
| (US dollars in thousands) | Services | Development | Vehicles | Solutions | Office | Center | Total | |||||||||||||||||||||
| Assets | ||||||||||||||||||||||||||||
| Liabilities | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Net assets/(liabilities) | ( | ) | ( | ) | ||||||||||||||||||||||||
| As at June 30, 2025*restated | Critical Power | Solar | Electric | Sustainable Energy | Corporate | Digital | ||||||||||||||||||||||
| (US dollars in thousands) | Services | Development | Vehicles | Solutions | Office | Assets | Total | |||||||||||||||||||||
| Assets | ||||||||||||||||||||||||||||
| Liabilities | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | - | ( | ) | |||||||||||||||
| Net assets/(liabilities) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||
| As at June 30, 2024 | Critical Power | Solar | Electric | Sustainable Energy | Corporate | |||||||||||||||||||
| (US dollars in thousands) | Services | Development | Vehicles | Solutions | Office | Total | ||||||||||||||||||
| Assets | ||||||||||||||||||||||||
| Liabilities | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Net assets/(liabilities) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||
5. Other gains
Schedule of gain (loss) on sale of assets
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Australian solar projects | - | - | ||||||||||
| Gains/(losses) on effectuation of DOCA | - | - | - | |||||||||
| Other gains | ||||||||||||
| Total other gains | ||||||||||||
6. Other income
There
is $
| F-27 |
| Table of Contents |
7. Operating profit/(loss)
Operating profit/(loss) from continuing operations is stated after charging/(crediting):
Schedule of other operating income
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Amortization of intangible assets | ||||||||||||
| Depreciation of property, plant and equipment | ||||||||||||
| Auditors’ remuneration - audit fees | ||||||||||||
| Auditors’ remuneration - tax services | - | - | - | |||||||||
| Directors’ emoluments | ||||||||||||
| Other gains | ( | ) | ( | ) | ( | ) | ||||||
In addition to audit services, the Company’s auditors provided comfort letter and consent services in connection
with the Company’s regulatory filings during the year ended June 30, 2026. Fees for these services amounted to $
8. Restructuring, impairment and other non-recurring costs
Schedule of restructuring expenses
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Corporate restructuring - litigation provision | - | |||||||||||
| Fiscal provision | ||||||||||||
| Gain on effectuation of DOCA | ( | ) | ( | ) | - | |||||||
| Remediation | - | - | - | |||||||||
| Acquisition related and other costs | ||||||||||||
| Total | ||||||||||||
In the year ended June 30, 2026, the Company recognised restructuring and other non-recurring costs of US$
In
the year ended June 30, 2023, a provision of $
Also, in FY24 HMRC cancelled the VAT registration of VivoPower International Services Ltd (“VISL”) due to outstanding payments. Post year end VISL has lodged a formal appeal with HMRC. Should this appeal fail we then plan to insist on a Tribunal hearing.
Additionally, post year end both PLC and VISL have engaged a UK based legal firm specializing in solving VAT issues with HMRC.
Restructuring and other non-recurring costs by nature are one-time incurrences, and therefore, do not represent normal trading activities of the business. These costs are disclosed separately in order to draw them to the attention of the reader of the financial information and enable comparability in future periods.
| F-28 |
| Table of Contents |
9. Staff numbers and costs
The average number of employees disclosed above includes directors and excludes Advisory Council members, external advisors, contractors and other non-payroll personnel.
The average number of employees (including directors) during the period was:
Schedule of average number of employee
| 2026 | 2025 | 2024 | ||||||||||
| Year Ended June 30 | ||||||||||||
| 2026 | 2025 | 2024 | ||||||||||
| Sales and Business Development | ||||||||||||
| Central Services and Management | ||||||||||||
| Production | ||||||||||||
| Data Center | - | - | ||||||||||
| Total | ||||||||||||
Their aggregate remuneration costs comprised:
Schedule of aggregate remuneration costs
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Salaries, wages and incentives | ||||||||||||
| Social security costs | ||||||||||||
| Pension contributions | ||||||||||||
| Short-term compensated absences | - | |||||||||||
| Total | ||||||||||||
Directors’ emoluments for the year ended June 30 2026 are disclosed in directors note.
Key Management Personnel:
Schedule of key management personnel expenses
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Salaries, wages and incentives | ||||||||||||
| Social security costs | - | |||||||||||
| Pension contributions | ||||||||||||
| Total | ||||||||||||
Key
management personnel are those below the Board level that have a significant impact on the operations of the business. The number of
key management personnel, including directors for the year ended June 30, 2026 was
10. Finance income and expense
Schedule of finance income and expense
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Finance income | ||||||||||||
| Foreign exchange gain | ||||||||||||
| Interest income | - | |||||||||||
| Total finance income | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Finance expense | ||||||||||||
| Related party loan interest payable | ||||||||||||
| Convertible loan notes and preference shares interest payable | ||||||||||||
| Convertible warrants | - | - | ||||||||||
| Lease liability interest payable | ||||||||||||
| Bank interest payable | ||||||||||||
| Foreign exchange losses | ||||||||||||
| Other finance costs | ||||||||||||
| Total finance expense | ||||||||||||
| F-29 |
| Table of Contents |
11. Taxation
| (a) | Tax (charge)/credit |
Schedule of income tax expenses
| (US dollars in thousands) | Continuing | Discontinued | Total | Continuing | Discontinued | Total | Continuing | Discontinued | Total | |||||||||||||||||||||||||||
| Year Ended June 30 | ||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2024 | ||||||||||||||||||||||||||||||||||
| (US dollars in thousands) | Continuing | Discontinued | Total | Continuing | Discontinued | Total | Continuing | Discontinued | Total | |||||||||||||||||||||||||||
| Current tax | ||||||||||||||||||||||||||||||||||||
| UK corporation tax | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||
| Foreign tax | ( | ) | - | ( | ) | - | - | - | - | |||||||||||||||||||||||||||
| Total current tax | ( | ) | - | ( | ) | - | - | - | - | |||||||||||||||||||||||||||
| Deferred tax | ||||||||||||||||||||||||||||||||||||
| Current year | ||||||||||||||||||||||||||||||||||||
| UK tax | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||
| Foreign tax | ( | ) | - | ( | ) | - | ( | ) | - | ( | ) | |||||||||||||||||||||||||
| Total deferred tax | ( | ) | - | ( | ) | - | ( | ) | - | ( | ) | |||||||||||||||||||||||||
| Total income tax | ( | ) | - | ( | ) | - | ( | ) | - | ( | ) | |||||||||||||||||||||||||
All current and deferred tax charges/(credits) recognised in both the current and prior year relate to foreign taxation arising in jurisdictions outside the United Kingdom.
The difference between the total tax charge and the amount calculated by applying the weighted average corporation tax rates applicable to each of the tax jurisdictions in which the Group operates to the profit before tax is shown below.
Schedule of reconciliation of accounting profit multiplied by applicable tax rates
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Loss before income tax before discontinuing operations | ( | ) | ( | ) | ( | ) | ||||||
| Group weighted average corporation tax rate | % | % | % | |||||||||
| Tax at standard rate | ||||||||||||
| Effects of: | ||||||||||||
| Effect of tax rates in foreign jurisdictions and other reconciling items | ( | ) | ( | ) | - | |||||||
| Other taxable/(deductible) items | - | - | ||||||||||
| Deferred tax assets not recognized on tax losses | ( | ) | ( | ) | ( | ) | ||||||
| Other tax effect | - | - | ||||||||||
| Total income tax from continuing operation for the period recognized in the | ||||||||||||
| Consolidated Statements of Comprehensive Loss | ( | ) | ( | ) | ||||||||
| (b) | Deferred tax |
Schedule of deferred tax
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Deferred tax assets | ||||||||||||
| Deferred tax liabilities | ( | ) | ( | ) | ( | ) | ||||||
| Net deferred tax (liability)/asset | ( | ) | ||||||||||
| F-30 |
| Table of Contents |
The deferred tax assets are analyzed as follows:
Schedule of deferred tax assets and liabilities
| Deferred tax assets | Tax losses | Other timing differences | Total | |||||||||
| June 30, 2023 | ||||||||||||
| Credit to comprehensive income | ( | ) | ( | ) | ( | ) | ||||||
| June 30, 2024 | - | |||||||||||
| Charged to comprehensive income | - | |||||||||||
| June 30, 2025 | - | |||||||||||
| Deferred tax assets, balance | - | |||||||||||
| Charged to comprehensive income | ( | ) | - | ( | ) | |||||||
| June 30, 2026 | - | |||||||||||
| Deferred tax assets, balance | - | |||||||||||
The deferred tax liabilities are analyzed as follows:
| Deferred tax liabilities | Accelerated allowances | Other timing differences | Total | |||||||||
| June 30, 2023 | - | ( | ) | ( | ) | |||||||
| Charged to comprehensive income | - | ( | ) | ( | ) | |||||||
| June 30, 2024 | - | ( | ) | ( | ) | |||||||
| Charged to comprehensive income | - | |||||||||||
| June 30, 2025 | - | ( | ) | ( | ) | |||||||
| Deferred tax liabilities, balance | - | ( | ) | ( | ) | |||||||
| Movement recognized during the year | - | ( | ) | ( | ) | |||||||
| Acquired in business combination | - | ( | ) | ( | ) | |||||||
| Translation and other differences | - | |||||||||||
| June 30, 2026 | - | ( | ) | ( | ) | |||||||
| Deferred tax liabilities, balance | - | ( | ) | ( | ) | |||||||
Deferred tax by type of temporary difference
(US dollars in thousands)
Schedule of deferred tax by type of temporary difference
| Asset / (Liability) | 2026 | 2025 | ||||||
| Property, plant and equipment | ( | ) | - | |||||
| Intangible assets | ( | ) | ( | ) | ||||
| Right-of-use assets | ( | ) | - | |||||
| Lease liabilities | - | |||||||
| Borrowings | - | - | ||||||
| Other temporary differences | - | |||||||
| Tax losses carried forward | ||||||||
| Deferred tax assets not recognized | ( | ) | - | |||||
| Recognized net deferred tax (liability)/asset | ( | ) | ||||||
| Presented as: deferred tax assets | - | |||||||
| Presented as: deferred tax liabilities - net | ( | ) | ( | ) | ||||
Deferred tax has been recognized in the current period using the tax rates applicable to each of the tax jurisdictions in which the Group operates. Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities.
At
the reporting date, the Group had unused tax losses of $
No deferred tax asset has been recognized in respect of the remaining losses as it is not considered probable that sufficient future taxable profits will be available against which these losses can be utilized. The unused tax losses may be carried forward indefinitely in the jurisdictions to which they relate.
The deferred tax balances as of June 30, 2025 are presented as previously reported, with no restatement. The basis for recognising deferred tax assets and offsetting deferred tax assets and liabilities is consistent across all periods presented.
The recognized deferred tax asset is limited to the amount supported by corresponding taxable temporary differences, resulting in full offset against the recognized deferred tax liability.
| F-31 |
| Table of Contents |
12. Property, plant and equipment
Schedule of property, plant and equipment
| (US dollars in thousands) | Computer Equipment | Motor Vehicles | Plant & Equipment | Fixtures & Fittings | Right-of-Use Assets | Total | ||||||||||||||||||
| Cost | ||||||||||||||||||||||||
| At June 30, 2023 | ||||||||||||||||||||||||
| Reclass to assets held for sale1 | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Foreign exchange | - | - | ( | ) | ( | ) | ||||||||||||||||||
| Additions | ||||||||||||||||||||||||
| Disposals | ( | ) | ( | ) | ( | ) | - | ( | ) | ( | ) | |||||||||||||
| At June 30, 2024 | - | |||||||||||||||||||||||
| Foreign Exchange | - | - | ||||||||||||||||||||||
| Additions | - | |||||||||||||||||||||||
| At June 30, 2025* restated | - | |||||||||||||||||||||||
| Foreign exchange | ( | ) | - | ( | ) | |||||||||||||||||||
| Additions | - | |||||||||||||||||||||||
| Disposals | ( | ) | ( | ) | ( | ) | - | - | ( | ) | ||||||||||||||
| At June 30, 2026 | - | |||||||||||||||||||||||
| (US dollars in thousands) | Computer Equipment | Motor Vehicles | Plant & Equipment | Fixtures & Fittings | Right-of-Use Assets | Total | ||||||||||||||||||
| Depreciation | ||||||||||||||||||||||||
| At June 30, 2023 | ||||||||||||||||||||||||
| Reclass to assets held for sale1 | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Foreign exchange | ( | ) | ( | ) | ( | ) | - | ( | ) | ( | ) | |||||||||||||
| Charge for the year | ||||||||||||||||||||||||
| Disposals | ( | ) | ( | ) | ( | ) | - | ( | ) | ( | ) | |||||||||||||
| At June 30, 2024 | - | |||||||||||||||||||||||
| Foreign Exchange | - | - | ||||||||||||||||||||||
| Charge for the year | - | |||||||||||||||||||||||
| Impairment | - | - | - | |||||||||||||||||||||
| At June 30, 2025*restated | - | |||||||||||||||||||||||
| Beginning Balance | - | |||||||||||||||||||||||
| Foreign exchange | ( | ) | ( | ) | - | ( | ) | |||||||||||||||||
| Charge for the year | - | |||||||||||||||||||||||
| Disposals | ( | ) | ( | ) | ( | ) | - | - | ( | ) | ||||||||||||||
| Impairment | - | - | - | - | - | - | ||||||||||||||||||
| At June 30, 2026 | - | |||||||||||||||||||||||
| Ending Balance | - | |||||||||||||||||||||||
| Net book value | Computer Equipment | Motor vehicles | Plant & Equipment | Fixtures & Fittings | Right-of-Use Assets | Total | ||||||||||||||||||
| At June 30, 2024 | - | - | ||||||||||||||||||||||
| At June 30, 2025*restated | - | |||||||||||||||||||||||
| At June 30, 2026 | - | |||||||||||||||||||||||
| Ending Balance | - | |||||||||||||||||||||||
| 1. |
| F-32 |
| Table of Contents |
13. Intangible assets
Schedule of intangible assets
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025*restated | 2024 | |||||||||
| Goodwill | ||||||||||||
| Other intangible assets | ||||||||||||
| Total | ||||||||||||
| a) | Goodwill |
Schedule of goodwill
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| As at July 1 | ||||||||||||
| Recognized during the year | ||||||||||||
| Impairment losses | - | - | ( | ) | ||||||||
| Foreign exchange | ( | ) | ||||||||||
| Carrying value | ||||||||||||
Goodwill
of $
The carrying amounts of goodwill by Cash Generating Unit (“CGU”) are as follows:
Schedule of carrying amounts of goodwill cash generating unit
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025*restated | 2024 | |||||||||
| Cromwell (allocated to the Data Center segment) | - | - | ||||||||||
| Tembo (allocated to the Electric Vehicle segment) | ||||||||||||
| Total | ||||||||||||
| Goodwill | ||||||||||||
The Group conducts impairment tests on the carrying value of goodwill and intangibles annually, or more frequently if there are any indications that goodwill might be impaired. The recoverable amount of the Cash Generating Unit (“CGU”) to which goodwill has been allocated is determined from value in use calculations. The key assumptions in the calculations are the discount rates applied, expected operating margin levels and long-term growth rates. Management estimates discount rates that reflect the current market assessments while margins and growth rates are based upon approved budgets and related projections.
The Group prepares cash flow forecasts using the approved budgets for the coming fiscal year and management projections for the following two years. Cash flows are also projected for subsequent years as management believe that the investment is held for the long term. These budgets and projections reflect management’s view of the expected market conditions and the position of the CGU’s products and services within those markets.
In the prior years, following the sale of Kenshaw Electrical on July 2 2024, the goodwill and intangible assets attributable to the Aevitas (Critical Power Services) CGU were fully written off as they were no longer considered recoverable from ongoing operations.
In addition, following the disposal of Kenshaw and a review of VivoPower Pty Ltd (“VivoPower Pty”), management determined on July 5 2024 to place VivoPower Pty into Voluntary Administration. As a result, the remaining goodwill and intangible assets associated with VivoPower Pty and held within other Group entities were also fully written off in the prior year.
On
May 12 2026, VivoPower acquired
At
June 30, 2026, we tested the goodwill and intangible assets of the Tembo cash generating unit, with a carrying amount of US$
| F-33 |
| Table of Contents |
The key assumptions are forecast revenue and EBITDA margin, the long-term growth rate and the discount rate. Management
determined these assumptions based on its financial model and, for the discount rate, external market information. The
key assumptions were a discount rate based on a weighted average cost of capital of
The recoverable amount of the CGU was determined based on value in use. The recoverable amount at June 30, 2026 was US$
The
recoverable amount would equal the carrying amount at a discount rate of approximately
In reviewing past performance and lack of Revenues we have analyzed the following;
| ● | Supply Chain issues relating to limited cash flows to procure components | |
| ● | Staffing issues relating to the changing nature of our R&D activities | |
| ● | Moving from Design to Test and potential rework | |
| ● | Customer appetite to place orders and commit | |
| ● | Customer acceptance of our revised Terms of Trade | |
| ● | Now aligned with what other EV Conversion Kits suppliers are requiring | |
| ● | Supplier’s capability to deliver the volumes we believe we can sell | |
| ● | Tembo’s ability to train and support the early adopters of our kits |
The cash-generating unit (CGU) represented by the Caret solar projects (TX75 and TX341) was assessed to be impaired in FY25, resulting in the recognition of an impairment charge.
In FY25, the Group reassessed the recoverability of its Caret solar development projects. The remaining active projects, TX75 and TX341, together with the other solar projects, were fully impaired during the FY25. Accordingly, no capitalized solar project development costs remain at June 30 2026.
Sensitivity
The recoverable amount exceeded the carrying amount by US$16.8 million. The recoverable amount would remain above the carrying amount at a discount rate of 25%, at a long-term growth rate of 0%, or with revenue 20% below forecast in every forecast year
| (b) | Other intangible assets |
Schedule of other intangible assets
| (US dollars in thousands) | Customer Relationships | Trade Names | Favorable Supply Contracts | Solar Projects | Product Development | Other Intangible Assets | Total Intangible Assets | |||||||||||||||||||||
| Cost | ||||||||||||||||||||||||||||
| At June 30, 2023 | ||||||||||||||||||||||||||||
| Foreign exchange | ( | ) | - | ( | ) | - | ( | ) | ||||||||||||||||||||
| Additions | - | - | - | - | ||||||||||||||||||||||||
| Disposals | - | - | - | - | - | - | ||||||||||||||||||||||
| At June 30, 2024 | ||||||||||||||||||||||||||||
| Foreign exchange | - | - | - | |||||||||||||||||||||||||
| Reclassification | - | - | - | - | ( | ) | - | |||||||||||||||||||||
| Additions | - | - | - | - | - | |||||||||||||||||||||||
| At June 30, 2025*restated | ||||||||||||||||||||||||||||
| Other intangible assets, Cost | ||||||||||||||||||||||||||||
| Foreign exchange | - | - | - | - | ( | ) | ( | ) | ||||||||||||||||||||
| Additions | - | - | - | |||||||||||||||||||||||||
| At June 30, 2026 | ||||||||||||||||||||||||||||
| Other intangible assets, Cost | ||||||||||||||||||||||||||||
| F-34 |
| Table of Contents |
| Amortization and Impairment | Customer Relationships | Trade Names | Favorable Supply Contracts | Solar Projects | Product Development | Other | Total | |||||||||||||||||||||
| At June 30, 2023 | - | |||||||||||||||||||||||||||
| Foreign exchange | ( | ) | ( | ) | - | ( | ) | - | ||||||||||||||||||||
| Amortization | - | - | ||||||||||||||||||||||||||
| Impairment | - | - | ||||||||||||||||||||||||||
| At June 30, 2024 | ||||||||||||||||||||||||||||
| Foreign exchange | - | - | - | |||||||||||||||||||||||||
| Amortization | - | - | - | |||||||||||||||||||||||||
| Impairment | - | - | - | - | - | |||||||||||||||||||||||
| At June 30, 2025 | ||||||||||||||||||||||||||||
| Other intangible assets, Amortization | ||||||||||||||||||||||||||||
| Foreign exchange | - | - | - | - | - | - | - | |||||||||||||||||||||
| Amortization | - | - | - | - | ||||||||||||||||||||||||
| Impairment | - | - | - | - | - | - | - | |||||||||||||||||||||
| At June 30, 2026 | ||||||||||||||||||||||||||||
| Other intangible assets, Amortization | ||||||||||||||||||||||||||||
| Net book value | Customer Relationships | Trade Names | Favorable Supply Contracts | Solar Projects | Product Development | Other | Total | |||||||||||||||||||||
| At June 30, 2024 | - | |||||||||||||||||||||||||||
| At June 30, 2025*restated | - | - | - | |||||||||||||||||||||||||
| At June 30, 2026 | - | |||||||||||||||||||||||||||
Customer
relationships and trade names are finite-life intangible assets and are amortized over their remaining useful lives, have an average
remaining period of amortization of
Additions
for the year ended June 30, 2026 comprise of $
Favourable
Supply contracts and trade names additions relate to intangible assets acquired as part of the acquisition of Cromwell, amounting to
$
14. Acquisition of Cromwell AS
On
12 May 2026, VivoPower acquired
The
acquisition-date fair value of the consideration transferred consisted of cash of $
| F-35 |
| Table of Contents |
The acquisition was funded from the proceeds of the Company’s private placement of convertible preferred stock. The following table summarizes the provisional fair values of the assets acquired and liabilities assumed at the date of the acquisition:
Schedule of fair values of assets acquired and liabilities assumed at the date of acquisition
| (US dollars in thousands) | 2026 | |||
| Fair value of consideration transferred: | ||||
| Cash paid at closing | ||||
| Deferred cash payments | ||||
| Fair value of Class A Ordinary Shares issued | ||||
| Fair value of warrant issued | ||||
| Total consideration | ||||
| Cash and cash equivalents | ||||
| Accounts receivable | ||||
| Prepayments and other assets | ||||
| Tax asset | ||||
| Other receivables | ||||
| Total current assets | ||||
| Property and equipment, net | ||||
| Intangible assets | ||||
| Right-of-use asset | ||||
| Other long-term assets | ||||
| Deferred tax assets | ||||
| Total assets | ||||
| Accounts payable and accrued expenses | ||||
| Lease liability - current portion | ||||
| Other payables | ||||
| Unearned revenue | ||||
| Total current liabilities | ||||
| Lease liability | ||||
| Deferred tax liability | ||||
| Total liabilities | ||||
| Fair value of identifiable net assets | ||||
| Goodwill on acquisition | ||||
From
the date of acquisition through June 30, 2026, Cromwell contributed revenue and net income of $
The
amounts above represent the Company’s provisional fair value estimates as of May 12 2026 and are subject to subsequent
adjustments as additional information is obtained during the applicable measurement period. The primary areas of estimates include
certain tangible assets acquired, liabilities assumed, as well as the identifiable intangible assets. The purchase price was
allocated to the tangible assets and identifiable intangible assets acquired and liabilities assumed based on their acquisition date
estimated fair values. The identifiable intangible asset consists of customer contracts and trademarks and tradenames which were
assigned fair values of $
The trademarks and trade names intangible asset was valued using the relief from royalty method. The customer contract intangible asset was valued using the multi-period excess earning method. These methods require several judgments and assumptions to determine the fair value of intangible assets, including projected hosting revenue, royalty rates, power costs, contributory asset charges, discount rates and tax rates. These nonrecurring fair value measurements are Level 3 measurements within the fair value hierarchy.
Goodwill
of $
| F-36 |
| Table of Contents |
15. Investment in subsidiaries
The subsidiary undertakings of the Group at June 30 2026 were as follows:
Schedule of investments in subsidiaries
| Subsidiary Undertakings | Percentage
of shares held |
Registered address | ||
| VivoPower International Services Limited | ||||
| VivoPower USA, LLC | ||||
| VivoPower US-NC-31, LLC | ||||
| VivoPower US-NC-47, LLC | ||||
| VivoPower (USA) Development, LLC | ||||
| Caret Global, LLC (formerly Caret, LLC) | ||||
| Caret Digital, LLC (formerly Caret Decimal, LLC) | ||||
| VIWR AU Pty Ltd (formerly VivoPower Pty Ltd) | ||||
| Aevitas O Holdings Pty Ltd | ||||
| Aevitas Group Limited | ||||
| Aevitas Holdings Pty Ltd | ||||
| KESW SO Pty Ltd (formerly Kenshaw Solar Pty Ltd and J.A. Martin Electrical Pty Limited) | ||||
| Tembo Technologies Pty Ltd (formerly Tembo EV Australia Pty Ltd) | ||||
| Tembo EV Pty Ltd | ||||
| TemboDrive Pty Ltd | ||||
| VivoPower Philippines Inc. | ||||
| VivoPower RE Solutions Inc. | ||||
| V.V.P. Holdings Inc. * | ||||
| Tembo e-LV B.V. | ||||
| Tembo 4x4 e-LV B.V. | ||||
| FD 4x4 Center B.V. | ||||
| Tembo Group B.V. (formerly Tembo EUV Solutions B.V) | ||||
| Tembo EUV Solutions FZCO | ||||
| Tembo EUV Investment Corporation Ltd | ||||
| Cromwell AS (now known as Vivo Power Norge Infrastructure AS) | ||||
| Nordland Data AS (now known as Arctic Norge Data I AS) |
| * |
VivoPower Philippines Inc. and VivoPower RE Solutions Inc. are both dormant. As there are no material net assets or results attributable to their minority shareholders at 30 June 2026, no material non-controlling interest is presented in the consolidated financial statements.
The following subsidiaries were deregistered during the year:
Electrical Engineering Group Pty Limited (Australia) – Deregistered on 16 December 2025.
KESW EL Pty Ltd (formerly Kenshaw Electrical Pty Ltd) (Australia) – Deregistered on 31 May 2026.
| F-37 |
| Table of Contents |
16. Other Investments
The Group’s financial assets at the reporting date comprise the following:
Schedule Of Other Investments
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Equity instruments measured at fair value through profit or loss | ||||||||||||
| Listed equity investment (16.67 % holding) | – | – | ||||||||||
| Unlisted equity investment | – | – | ||||||||||
| Equity investment | – | – | ||||||||||
| Debt instruments measured at amortized cost | ||||||||||||
| Convertible note receivable | – | – | ||||||||||
| Note receivable | – | – | ||||||||||
| Total Other Investments | – | – | ||||||||||
Listed equity investment
The
listed equity investment represents a
The ownership interest is below the 20 % threshold that creates a rebuttable presumption of significant influence under IAS 28. The Group does not have board representation or other participation in the financial and operating policy decisions of the investee, and there are no other indicators of significant influence. Accordingly, the investment is accounted for as a financial asset under IFRS 9 and measured at fair value through profit or loss. Fair value is based on the quoted market price at the reporting date. Changes in fair value are recognized in profit or loss.
Unlisted equity investment
The unlisted equity investment represents a minority passive holding. The Group does not have significant influence over the investee. The instrument is measured at fair value through profit or loss. Fair value is determined using recent transaction evidence and other relevant market information available at the reporting date. Changes in fair value are recognized in profit or loss.
Convertible note receivable
The convertible note is an unsecured debt instrument that carries a contractual interest rate and is convertible, at the Group’s option, into equity of the issuer on or before a fixed sunset date. Until conversion, the instrument remains a pure debtor-creditor relationship. The host debt instrument is measured at amortized cost using the effective-interest method. Any embedded conversion feature that does not meet the fixed-for-fixed criterion is separated and measured at fair value through profit or loss. At the reporting date the carrying amount approximates the outstanding principal advanced, net of any impairment allowance.
Expected credit losses
The Group has assessed expected credit losses on the debt instrument measured at amortized cost. At the reporting date no significant increase in credit risk has been identified and the loss allowance is not material.
17. Cash and cash equivalents
Schedule of cash and cash equivalents
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Cash at bank and in hand | ||||||||||||
The credit ratings of the counterparties with which cash was held are detailed in the table below.
Schedule of credit risk exposure
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| A+ | ||||||||||||
| A | - | - | - | |||||||||
| A- | - | - | - | |||||||||
| AA- | ||||||||||||
| Bank Wallets | - | - | ||||||||||
| Total | ||||||||||||
| F-38 |
| Table of Contents |
18. Restricted cash
Schedule of restricted cash
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Bank guarantee security deposit | ||||||||||||
Restricted cash represents cash balances subject to restriction as security for bank guarantees and other performance obligations.
19. Trade and other receivables
Schedule of trade and other receivables
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Current receivables | ||||||||||||
| Trade receivables | - | - | ||||||||||
| Contract assets | ||||||||||||
| Other current assets | ||||||||||||
| Prepayments | ||||||||||||
| Other receivables | ||||||||||||
| Current tax receivable | - | - | - | |||||||||
| Total | ||||||||||||
Other
receivables at June 30, 2026 include receivables from investors amounting to $
Other
receivables at June 30, 2025 include receivables from investors amounting to $
Other
receivables as of June 30, 2024, include receivables from investors amounting to $
In accordance with IFRS 15, contract assets are presented as a separate line item. The Company has not recognized any loss allowance for contract assets.
Analysis of trade receivables:
Schedule of analysis of trade receivables
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Trade receivables | - | - | ||||||||||
| Less: credit note provision | - | - | - | |||||||||
| Total | - | - | ||||||||||
The maximum exposure to credit risk for trade receivables by geographic region was:
Schedule of maximum exposure to credit risk for trade receivables
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| United States | - | - | ||||||||||
| Australia | - | - | ||||||||||
| Netherlands | - | - | - | |||||||||
| Norway | - | - | ||||||||||
| Total | - | - | ||||||||||
| Trade receivables by geographic region | - | - | ||||||||||
The aging of the trade receivables, net of is:
Schedule of aging of the trade receivables, net of provisions
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| 0-90 days | - | - | ||||||||||
| Greater than 90 days | - | - | ||||||||||
| Total | - | - | ||||||||||
| Trade receivables, net | - | - | ||||||||||
| F-39 |
| Table of Contents |
20. Inventory
Schedule of inventory
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Raw materials | ||||||||||||
| Total | ||||||||||||
21. Assets classified as held for sale
Schedule of assets held for sale
| (US dollars in thousands) | % Owned | 2026 | 2025 | 2024 | ||||||||||||
| Year Ended June 30 | ||||||||||||||||
| (US dollars in thousands) | % Owned | 2026 | 2025 | 2024 | ||||||||||||
| KESW EL Pty Ltd (formerly Kenshaw Electrical Pty Ltd) | - | - | ||||||||||||||
| Total | - | - | ||||||||||||||
| Assets held for sale | - | - | ||||||||||||||
The ex-power and critical supply operations of Kenshaw Electrical Pty Ltd were sold on July 2, 2024. As disclosed in note 22, the assets and liabilities of the disposed operation met the definition of discontinued operation under IFRS 5 at June 30, 2024. Accordingly, assets and liabilities of the discontinued operation were reclassified to assets and liabilities held for sale as at June 30, 2024.
22. Discontinued operations
On
July 2, 2024, Kenshaw Electrical was sold for a consideration of $
Financial information relating to the discontinued operation for the period to the date of disposal is set out below:
Financial performance and cash flow information
The financial performance and cash flow information presented are for the years ended June 30, 2025, 2024 and 2023:
Schedule of financial performance and cash flow information
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Revenues | - | - | ||||||||||
| Cost of sales | - | - | ( | ) | ||||||||
| Income/(Expenses) | ( | ) | ||||||||||
| Loss before income tax | ( | ) | ||||||||||
| Income tax expense | - | - | - | |||||||||
| Gain/(loss) from discontinued operations | ( | |||||||||||
| Net cash inflow/(outflow) from operating activities | ( | ) | ||||||||||
| Net cash inflow/(outflow) from investing activities | - | - | ||||||||||
| Net cash inflow/(outflow) from financing activities | - | - | ||||||||||
| Net increase in cash generated by subsidiary | ( | ) | ||||||||||
| F-40 |
| Table of Contents |
Assets and liabilities of disposal group as held for sale
The following assets and liabilities were reclassified as held for sale in relation to the discontinued operations as at June 30, 2026, 2025 and 2024:
Schedule of assets and liabilities held for sale and discontinued operations
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Assets classified as held for sale | - | - | - | |||||||||
| Trade and other receivables | - | - | ||||||||||
| Inventories | - | - | ||||||||||
| Property, plant and equipment | - | - | ||||||||||
| Goodwill | - | - | ||||||||||
| Intangible assets | - | - | - | |||||||||
| Deferred tax assets | - | - | ||||||||||
| Total assets of disposal group classified as held for sale | - | - | ||||||||||
| Liabilities directly associated with assets classified as held for sale | ||||||||||||
| Trade and other payables | - | - | ||||||||||
| Current debt | - | - | ||||||||||
| Non-current debt | - | - | ||||||||||
| Lease liabilities - current | - | - | ||||||||||
| Lease liabilities - non-current | - | - | ||||||||||
| Total liabilities of disposal group classified as held for sale | - | - | ||||||||||
| Net assets/(liabilities) identified as held for sale | - | - | ( | ) | ||||||||
Schedule of consideration received or receivable
| Estimated gain on sale - Kenshaw Electrical Pty Ltd | USD | AUD | ||||||
| Consideration received or receivable | ||||||||
| Cash | ||||||||
| Purchase price | ||||||||
| Working capital adjustment | ( | ) | ( | ) | ||||
| Cash | ||||||||
| Fair value of contingent consideration | - | - | ||||||
| Less costs to sell | - | - | ||||||
| Total disposal consideration | ||||||||
| Estimated carrying amount of net assets/(liabilities) sold | ( | ) | ( | ) | ||||
| Estimated gain on sale as at June 30, 2024 | ||||||||
Disposal
consideration for the sale of the Kenshaw Electrical business on July 2, 2024 comprised a cash purchase price of $
Disposal
consideration for the sale of the business and assets of J.A. Martin Electrical Pty Limited (excluding its solar division) on July 1,
2022, comprised cash purchase price, including completion working capital adjustments of $
Schedule of reconciliation of adjusted loss on sale
| Reconciliation of adjusted gain on sale - Kenshaw Electrical | USD 000 | AUD 000 | ||||||
| Gain on sale - as estimated at June 30, 2024 | ||||||||
| Cash consideration adjustment | - | - | ||||||
| Fair value of contingent consideration adjustment | - | - | ||||||
| Cost to sell adjustment | ||||||||
| Carrying amount of net assets sold adjustment | - | - | ||||||
| Gain on sale reported in year ended June 30, 2025 | ||||||||
| F-41 |
| Table of Contents |
23. Trade and other payables
Schedule of trade and other payables
| (US dollars in thousands) | 2026 | 2025*restated | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025*restated | 2024 | |||||||||
| Current trade and other payables | ||||||||||||
| Trade payables | ||||||||||||
| Shares to be issued | ||||||||||||
| Deferred acquisition consideration payable | - | - | ||||||||||
| Accruals | ||||||||||||
| Related party payable | - | - | ||||||||||
| Payroll liabilities | ||||||||||||
| Sales tax payable | - | - | ||||||||||
| Deferred income | ||||||||||||
| Other creditors | ||||||||||||
| Total current trade and other payables | ||||||||||||
| Non-current other payables | ||||||||||||
| Non-current accrued interest | - | - | ||||||||||
| Non-current accrued loan and other fees | - | - | ||||||||||
| Total non-current other payables | - | - | ||||||||||
In accordance with IFRS 15 – Revenue from Contracts with Customers, deferred income is presented as a separate line item. Deferred income relates to the Company’s obligation to transfer goods or services to customers for which the Company has received consideration (or the amount is due) from customers. Deferred income is recorded as revenue when the Company fulfills its performance obligations under the contract.
Non-current accrued interest relates to interest on AWN related party loans. As of June 30, 2026, a portion of the interest are classified under noncurrent assets as they are due beyond 1 year. All falling due within the next year are then classified as current in “Accruals” line item under Current trade and other payables.
24. Provisions
Schedule of provisions
| (US dollars in thousands) | 2026 | 2025 *restated | 2024 | |||||||||
| As at June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 *restated | 2024 | |||||||||
| Current provisions | ||||||||||||
| Employee entitlements | - | |||||||||||
| Fiscal | ||||||||||||
| Litigation | ||||||||||||
| Warranty | - | - | - | |||||||||
| Total current provisions | ||||||||||||
| Non-current provisions | ||||||||||||
| Employee entitlements | ||||||||||||
| Litigation | - | |||||||||||
| Total non-current provisions | ||||||||||||
| Total provisions | ||||||||||||
| F-42 |
| Table of Contents |
A dispute arose between VivoPower PLC and Accès Industriel Mining, Inc. (“Accès”) concerning the supply and installation of electric vehicle conversion equipment under a distribution agreement dated 17 June 2021. In October 2025, the parties entered into a settlement agreement without admission of liability, providing for settlement payments and the release of claims arising from the dispute.
The
agreement’s payment schedule provided for cash instalments totaling US$
In
our FY23 accounts, a provision of $
Also, in FY24 HMRC cancelled the VAT registration of VivoPower Services Ltd (VISL) due to outstanding payments. Post year end VISL has lodged a formal appeal with HMRC. Should this appeal fail we then plan to insist on a Tribunal hearing.
Additionally, post-year end both PLC and VISL have engaged a UK based legal firm specializing in solving VAT issues with HMRC.
Warranty provisions in Australia relate to the servicing of generators and is based on a percentage of revenue generated. For FY24, this provision is no longer required as the acquirer of Kenshaw has taken responsibility for this.
Employee entitlements during the year include provisions for annual leave.
Schedule of other provisions
| (US dollars in thousands) | Employee Entitlements | Remediation | Fiscal | Litigation | Warranty | Total | ||||||||||||||||||
| At June 30, 2024 | - | - | ||||||||||||||||||||||
| Foreign exchange | ( | ) | - | - | - | - | ( | ) | ||||||||||||||||
| Additional provisions | - | - | ||||||||||||||||||||||
| Reclassification/netting against VAT receivable | - | - | ( | ) | - | - | ( | ) | ||||||||||||||||
| Provisions utilized | - | - | - | ( | ) | - | ( | ) | ||||||||||||||||
| At June 30, 2025 | - | - | ||||||||||||||||||||||
| Balance | - | - | ||||||||||||||||||||||
| Foreign exchange | ( | ) | - | - | - | - | ( | ) | ||||||||||||||||
| Additional provisions | - | - | - | |||||||||||||||||||||
| At June 30, 2026 | ||||||||||||||||||||||||
| At June 30, 2026 | - | - | ||||||||||||||||||||||
| Balance | - | - | ||||||||||||||||||||||
25. Warrant derivative liability
Schedule Of Warrant Derivative Liability
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Year Ended June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Warrant derivative liability | - | - | ||||||||||
| Total | - | - | ||||||||||
Warrant derivative liabilities are initially recognised at fair value using a Monte Carlo simulation model. The valuation incorporates relevant market inputs and assumptions, including the underlying share price, exercise price, expected volatility, warrant term, risk-free interest rate and expected dividends, together with contractual exercise conditions and reset provisions.
Warrant derivative liabilities are subsequently remeasured at fair value at each reporting date using the Monte Carlo simulation model, with updated market inputs, assumptions and remaining contractual terms. Changes in fair value are recognised in profit or loss.
At June 30, 2026, the fair value of warrant
derivative liabilities relating to the PIPE convertible preference shares amounted to US$
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26. a) Loans and borrowings
Schedule of loans and borrowings
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| As at June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Current liabilities | ||||||||||||
| Debtor invoice financing | - | |||||||||||
| Shareholder loans | ||||||||||||
| Total | ||||||||||||
| Current liabilities | ||||||||||||
| Non-current liabilities | ||||||||||||
| Shareholder loan | ||||||||||||
| Total | ||||||||||||
| Non-current liabilities | ||||||||||||
| Total | ||||||||||||
Debtor invoice financing
In
FY23, a new facility with a limit of AU$
Shareholder loans
The Group has shareholder loan facilities with AWN Holdings Limited (“AWN”), a related party of the Group.
The
shareholder loan arrangements include amounts historically advanced by AWN to the Company and Aevitas O Holdings Pty Limited under separate
long-term and short-term facilities. These included advances denominated in US dollars and Australian dollars and subject to interest
rates ranging from
On
June 30, 2021, the Company agreed a refinancing of its existing $
On June 30, 2022 further amendments to the loan were agreed with AWN:
(i)
to defer repayment of principal to commence on October 1, 2023, with repayments over
(ii)
to defer interest payments from October 1, 2021, becoming due and payable on the earlier of a) completion by VivoPower of a debt or equity
raise of at least $
(iii)
to increase the interest rate and line fee to
(iv)
the initial refinancing fee of $
(v)
a new fixed facility extension fee of $
On January 11, 2023, further amendments to the loan were agreed with AWN:
(i)
to defer repayment of principal to commence on April 1, 2025, with repayments over
(ii)
to defer interest payments from October 1, 2023, becoming due and payable on the earlier of; a) completion by VivoPower of a debt or
equity raise of at least $
(iii)
to extend the increased interest rate and line fee of
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| Table of Contents |
(iv)
to extend the initial refinancing fee accruing incrementally at
(v)
to defer the repayment date of the previous fixed facility extension fee of $
(vi)
In addition to previously agreed refinancing fees, an additional $
On June 30, 2023, further amendments to the loan were agreed with AWN:
(i)
to defer interest payments from October 1, 2024 to April 1, 2025, and to replace the conditional requirement to repay accrued interest
upon completion by VivoPower of a debt or equity raise of at least $
(ii)
upon completion by VivoPower PLC of a qualifying liquidity event of at least $
a)
proceeds from $
b)
proceeds from $
c)
proceeds $
(iii) for the purposes of the mandatory prepayment requirement, a ‘qualifying liquidity event’ excludes direct investments into VivoPower’s subsidiary, Tembo, and debt raised in respect of working capital finance facilities, but includes:
a) equity or debt raise;
b) trade sale of underlying subsidiary or business unit (including, for example, Aevitas and Caret); and
c) loan repayment from Tembo to VivoPower..
(iv)
as consideration for the concessions agreed with AWN, VivoPower PLC committed to issue AWN with
On
June 30, 2024, VivoPower amended its shareholder loan financing agreement with AWN. The loan includes a facility limit of $
The
interest rate is
Mandatory
prepayments apply on a qualifying liquidity event, including capital or debt raises or proceeds from disposals, with
We also conducted an assessment in accordance with IFRS 9 to evaluate the novation of the loan. We concluded that there was no substantial modification in the net present value of the loan.
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| Table of Contents |
Short-term loans
In
December 2021, a short term loan of $
On
February 22, 2022, a short term $
On
December 22, 2022, a short term $
In February and March 2023, further
short-term loans of AU$
The
July 2023 loans of AU$
Total
owed to AWN at June 30, 2026 was $
Interest
expense, including line and refinancing fees, was $
On
June 30, 2024, VivoPower amended its shareholder loan financing agreement with AWN. The loan includes a facility limit of $
26. b) Lease liabilities
Schedule of lease liabilities
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| As at June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Current liabilities | ||||||||||||
| Lease liabilities | - | |||||||||||
| Total | - | |||||||||||
| Current liabilities | - | |||||||||||
| Non-current liabilities | ||||||||||||
| Lease liabilities | - | |||||||||||
| Total | - | |||||||||||
| Non-current liabilities | - | |||||||||||
| Total | - | |||||||||||
Leases
The Group leases land, buildings and other assets. Information relating to leases for which the Group is a lessee is presented below.
Right-of-use assets
Right-of-use
assets had a carrying amount of $
Lease liabilities
Lease
liabilities at June 30, 2026 were $
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| Table of Contents |
The obligations under lease liabilities are as follows:
Schedule of obligations under lease liabilities
| Minimum Lease Payments | Present Value of Minimum Lease Payments | |||||||||||||||||||||||
| As at June 30 | As at June 30 | |||||||||||||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | 2026 | 2025 | 2024 | ||||||||||||||||||
| Amounts payable under lease liabilities: | ||||||||||||||||||||||||
| Less than one year | - | - | ||||||||||||||||||||||
| Later than one year but not more than five | - | - | ||||||||||||||||||||||
| - | - | |||||||||||||||||||||||
| Future finance charges | ( | ) | ( | ) | - | - | - | - | ||||||||||||||||
| Total lease obligations | - | - | ||||||||||||||||||||||
Other lease related information
Variable lease payments
Certain lease payments of the Group are linked to the Consumer Price Index. Payments linked to the index are included in the measurement of lease liabilities and right-of-use assets at the index rate applicable at each reporting date. Changes in such payments arising from indexation adjustments are recognised as a remeasurement of the lease liability and a corresponding adjustment to the right-of-use asset.
Residual value guarantees
The Group’s lease arrangements do not contain material residual value guarantees.
Extension, termination and renewal options
Extension and termination options are included in the lease term when the Group is reasonably certain to exercise them. Certain leases of the Group contain renewal provisions, and renewal periods are included in the lease term only when the Group is reasonably certain to exercise them. This assessment is reviewed when a significant event or change in circumstances affects it.
27. Called up share capital
Schedule of allotted called up and fully paid
| 2026 | 2025 *restated | 2024 | ||||||||||
| As at June 30 | ||||||||||||
| 2026 | 2025 *restated | 2024 | ||||||||||
| Allotted, called up and fully paid | ||||||||||||
| Class
A Ordinary Shares of $ | $ | $ | $ | |||||||||
| Number allotted | ||||||||||||
| Class
A Ordinary Shares of $ | $ | $ | $ | |||||||||
| Class A Ordinary Shares | $ | $ | $ | |||||||||
“The Company is incorporated
in England and Wales and, under the Companies Act 2006, does not have an authorized share capital. Our articles of association do not
limit the number of shares we may issue. On January 30, 2026, our shareholders authorized the directors, under section 551 of the Companies
Act 2006, to allot shares and to grant rights to subscribe for, or convert any security into, shares up to an aggregate nominal amount
of US$
Movements in Class A Ordinary Shares:
Schedule of movements in ordinary shares
| Shares No. | Par value USD 000 | Share
premium USD 000 | Share subscription USD 000 | Total USD 000 | ||||||||||||||||
| At June 30, 2023 | - | |||||||||||||||||||
| Capital raises 1 | - | |||||||||||||||||||
| Employee share scheme issues | - | |||||||||||||||||||
| Reverse stock split | ( | ) | - | - | - | - | ||||||||||||||
| At June 30, 2024 | - | |||||||||||||||||||
| Capital raises 1 | ||||||||||||||||||||
| Other share issuances 2 | - | |||||||||||||||||||
| Equity instruments | - | - | - | |||||||||||||||||
| At June 30, 2025 | ||||||||||||||||||||
| Capital raises 1 | - | |||||||||||||||||||
| Equity instruments | - | |||||||||||||||||||
| Other issuances | - | |||||||||||||||||||
| At June 30, 2026 | ||||||||||||||||||||
At
June 30 2026, the Company had
During
the year ended 30 June 2026, the Company issued
Each Ordinary Share has the same right to receive dividends and repayment of capital and represents one vote at shareholders’ meetings. Proceeds received in excess of nominal value are included in share premium. Costs directly attributable to new share issues are recognized in other reserves (see Note 28).
| F-47 |
| Table of Contents |
| 1 |
During
the year ended June 30, 2025, the company issued
On
July 29, 2022, the Company entered into a Securities Purchase Agreement to issue and sell, in a registered direct offering directly
to an investor,
In
a concurrent private placement, the Company agreed to issue to the investor, Series A Warrants exercisable for an aggregate of
Each share has the same right to receive dividends and repayment of capital and represent one vote at shareholders’ meetings. Proceeds received in addition to the nominal value of the shares issued during the year have been included in share premium. The costs associated with the issuance of new shares are included within other reserves (see Note 28). Share premium has also been recorded in respect of the share capital related to employee share awards. |
| 2 | |
| 3 | During
the year ended June 30, 2026, the Company made several share issuances to settle liabilities
to (a) Arowana Global Impact for
During
the year ended 30 June 2026, the Company also issued
During
the year ended June 30, 2025, the Company made several share issuances to settle liabilities to (a) Arowana International UK Ltd
for |
| F-48 |
| Table of Contents |
| 4 | The Company issued the following warrants: |
| ● | Navinder Singh: | |
| The
Company issued | ||
| ● | Suneet Wadha: | |
On
30 May 2025, the Company granted Global Investing Network Inc. (“GINI”) warrants
to acquire
On
early termination of the agreement, effective 31 August 2025 and documented on 27 October 2025, the warrants were reduced to
The
warrants were valued using the Black Scholes model, incorporating a volatility of
| ||
| ● | AWN Holdings | |
| On
23 November 2024, the Company and AWN Holdings Limited (“AWN”), a lender under a shareholder loan, agreed to extend the
maturity of the loan from 31 March 2025 to 1 January 2026. The loan facilities extended comprised principal of US$ | ||
| The
warrants were valued using the Monte Carlo Model, incorporating a volatility of |
Share subscription equity reserve
At
30 June 2025, US$
Management
has assessed the contractual terms of the executed subscription agreement and concluded that the arrangement is equity in nature under
IAS 32 because the Company has no contractual obligation to deliver cash or another financial asset in settlement of the arrangement
and settlement is through the issue of Class A Ordinary Shares. The corresponding US$
Upon legal allotment and issue of the Class A Ordinary Shares, the amount recognised within the share subscription equity reserve will be transferred to share capital and share premium. The reclassification has no impact on total equity.
Non-cash financing activities
During
the year ended June 30, 2026, the Group recognized $
Total
directly attributable capital-raising costs recognized in other reserves were $
The subscription receivables and other non-cash settlements did not result in cash flows during the year and have therefore been excluded from the consolidated statement of cash flows.
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| Table of Contents |
28. Other reserves
Schedule of changes in other reserves
| (US dollars in thousands) | Preference shares ¹ | Shares pending issue | Capital raising costs ² | Equity incentive costs ³ | Share awards issuance ³ | Dividend reserve | Warrant reserve | Foreign exchange | Total | |||||||||||||||||||||||||||
| At June 30, 2023 | – | ( | ) | ( | ) | – | – | ( | ) | ( | ) | |||||||||||||||||||||||||
| Interest on equity instruments | – | – | – | – | – | – | – | |||||||||||||||||||||||||||||
| Capital raising costs | – | – | ( | ) | – | – | – | – | – | ( | ) | |||||||||||||||||||||||||
| Equity incentives cost less shares issued | – | – | – | ( | ) | – | – | – | ||||||||||||||||||||||||||||
| Other movements | – | – | – | – | – | – | – | |||||||||||||||||||||||||||||
| At June 30, 2024 | – | ( | ) | ( | ) | – | – | ( | ) | ( | ) | |||||||||||||||||||||||||
| Interest on equity instruments | – | – | – | – | – | – | – | |||||||||||||||||||||||||||||
| Capital raising costs | – | – | ( | ) | – | – | – | – | – | ( | ) | |||||||||||||||||||||||||
| Equity incentives cost less shares issued | – | – | – | – | – | – | – | |||||||||||||||||||||||||||||
| Other movements | – | – | – | – | – | – | ( | ) | ||||||||||||||||||||||||||||
| At June 30, 2025 | – | ( | ) | ( | ) | – | – | ( | ) | ( | ) | |||||||||||||||||||||||||
| Interest on equity instruments | – | – | – | – | – | – | – | |||||||||||||||||||||||||||||
| Capital raising costs | – | – | ( | ) | – | – | – | – | – | ( | ) | |||||||||||||||||||||||||
| Equity incentives cost less shares issued | – | – | – | – | – | – | – | |||||||||||||||||||||||||||||
| Dividend reserve | – | – | – | – | – | – | – | |||||||||||||||||||||||||||||
| Warrant reserve | – | – | – | – | – | – | – | |||||||||||||||||||||||||||||
| Other movements | ( | ) | – | – | – | – | – | – | ( | ) | ||||||||||||||||||||||||||
| At June 30, 2026 | - | – | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
Settlement of Aevitas preference shares and issuance of convertible preference shares
During
the year, the Group entered into an arrangement with The ASEAN Foundation for the acquisition and cancellation of the outstanding preference
shares of Aevitas Group Limited and assumption of the related unpaid dividend obligations. As consideration, the Company issued
The
Group derecognized Aevitas preference shares and accrued dividends of $
| F-50 |
| Table of Contents |
Equity incentive cost
The
$
During
the year ended June 30, 2025, $
Schedule of incentive plan
| Number
of RSUs, PSUs and BSAs (thousands) | Weighted average grant date fair value $000 | |||||||
| Outstanding at June 30, 2023 | $ | |||||||
| Granted | ||||||||
| Vested/Settled | ( | ) | ( | ) | ||||
| Reverse stock split impact | ( | ) | ( | ) | ||||
| Forfeit | ( | ) | ( | ) | ||||
| Outstanding at June 30, 2024 | $ | |||||||
| Granted | ||||||||
| Vested | ( | ) | ( | ) | ||||
| Forfeit | - | - | ||||||
| Outstanding at June 30, 2025 | ||||||||
| Granted | ||||||||
| Vested | ( | ) | ( | ) | ||||
| Forfeit | ( | ) | ( | ) | ||||
| Outstanding at June 30, 2026 | ||||||||
The table above reconciles the number of outstanding RSUs, DSUs, PSUs and BSAs and the related weighted-average grant-date fair value from FY2024 through FY2026. The FY2026 awards shown are equity-settled.
Transfers between the equity incentive reserve, share awards issuance reserve, share capital and share premium arising when awards vest or shares are issued represent movements within equity and do not result in an additional expense or cash flow.
In October 2023, the company implemented a 10-to-1 reverse stock split, which impacted the outstanding number of RSUs, PSUs, and BSAs. The reverse stock split proportionally reduced the number of outstanding awards, including their weighted average grant date fair value. As a result, employees holding these grants experienced a corresponding adjustment in the value of their awards to align with the revised share structure. This adjustment ensures that the economic value and equity proportion represented by the awards remains consistent post-split.
Warrants
Warrants issued in connection with the Group’s financing arrangements have been classified as equity because they provide for the exchange of a fixed amount of consideration for a fixed number of the Company’s Class A Ordinary Shares and do not contain a contractual cash-settlement obligation.
Accordingly, the warrants satisfy the fixed-for-fixed criterion in IAS 32 and contain no contractual cash-settlement obligation.
The fair value of equity-classified warrants is estimated at initial recognition using a Monte Carlo simulation model. The valuation incorporates relevant market inputs and assumptions, including the underlying share price, exercise price, expected volatility, warrant term, risk-free interest rate and expected dividends, together with the instruments’ contractual terms. Once recognised in equity, the warrants are not subsequently remeasured.
The
fair value of the warrants issued during the year was $
During the year, the Company issued
a warrant over
Convertible preference shares and related warrants
During
the year, the Company issued
The
preference-share component is presented within equity at $
On
1 April 2026, the Board approved the issue of
Cumulative payment-in-kind dividends
The
preference shares carry a cumulative payment-in-kind dividend of
For equity-classified preference shares, these dividends are accounted for as distributions directly within equity and presented in a separate cumulative dividend reserve. No shares in settlement of the accumulated dividends had been issued at the reporting date.
| F-51 |
| Table of Contents |
Related warrants
The
preference-share financing arrangements included warrants over an initial aggregate of
These warrants are accounted for separately as derivative financial liabilities because their settlement and reset provisions do not satisfy the fixed-for-fixed criterion in IAS 32. They are initially recognized at fair value, with the remaining subscription proceeds allocated to the preference-share component, and subsequently remeasured at fair value through profit or loss.
The
warrants’ initial fair value was $
Asean warrants:
The
warrants comprise
On
initial recognition, the warrants were measured at $
29. Loss per share
Basic loss per share is calculated by dividing the loss attributable to holders of ordinary shares of the Company by the weighted-average number of ordinary shares outstanding during the year.
The loss and weighted average numbers of Class A Ordinary Shares used in the calculation of loss per share are as follows:
Schedule of earnings (loss) and weighted average numbers of ordinary shares
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| As at June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Loss for the year / period attributable to equity owners | ( | ) | ( | ) | ( | ) | ||||||
| Weighted average number of shares in issue (‘000s) | ||||||||||||
| Basic loss per share (dollars) | ( | ) | ( | ) | ( | ) | ||||||
| Diluted loss per share (dollars) | ( | ) | ( | ) | ( | ) | ||||||
On October 4, 2023, the Company announced a one-for-ten (1-10) reverse stock split and par value change of its Class A Ordinary Shares which began trading on a post-split basis on October 6, 2023. The reverse stock split has been applied retrospectively to the prior years’ share figures for the purpose of calculating EPS.
Diluted earnings per share is calculated by adjusting the weighted-average number of ordinary shares outstanding for the effect of all potentially dilutive ordinary shares. For the year ended June 30, 2026, the effect of the Company’s potential ordinary shares was antidilutive because the Group incurred a loss. Accordingly, diluted loss per share is equal to basic loss per share.
Potential ordinary shares arising from the following the instruments were excluded from the calculation of diluted earnings per share for the year ended June 30, 2026 because their inclusion would have reduced the loss per share and therefore would have been antidilutive.
Schedule of potentially dilutive instruments
| Number of instruments (thousands) | 2026 | 2025 | ||||||
| Warrants – classified as equity | ||||||||
| Warrants – classified as liabilities (derivatives) | – | |||||||
| Total warrants | ||||||||
| Share options | – | – | ||||||
| RSUs / PSUs / BSAs | ||||||||
| Total | ||||||||
30. Pensions
The
Company’s principal pension plan comprises the compulsory superannuation scheme in Australia, where the Company contributed
Schedule of pensions
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| As at June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| VivoPower International Services | - | |||||||||||
| KESW EL Pty Ltd | - | - | ||||||||||
| Tembo EV Pty Ltd | - | - | ||||||||||
| Tembo Technologies Pty Ltd | - | - | ||||||||||
| Tembo 4x4 e-LV B.V. | - | |||||||||||
| KESW SO Pty Ltd | - | - | ||||||||||
| VIWR AU Pty Ltd | - | |||||||||||
| Total Pension recognized in P&L | ||||||||||||
| F-52 |
| Table of Contents |
31. Financial instruments
Schedule of detailed information about financial instruments
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| As at June 30 | ||||||||||||
| (US dollars in thousands) | 2026 | 2025 | 2024 | |||||||||
| Financial assets at amortized cost | ||||||||||||
| Trade and other receivables | ||||||||||||
| Cash and cash equivalents | ||||||||||||
| Restricted cash | ||||||||||||
| Total | ||||||||||||
| Financial liabilities at amortized cost | ||||||||||||
| Loans and borrowings | ||||||||||||
| Lease liabilities | - | |||||||||||
| Trade and other payables | ||||||||||||
| Total | ||||||||||||
At 30 June 2026, the financial assets and liabilities presented in this note are measured at amortized cost. No financial assets or liabilities measured at fair value through profit or loss are included in the year-end financial-instrument balances disclosed above.
The Group’s financial instruments include financial assets and financial liabilities measured at amortized cost, equity investments measured at fair value through profit or loss, and derivative warrant liabilities measured at fair value through profit or loss.
Changes in the fair value of the equity investments and derivative warrant liabilities are recognized in profit or loss. Fair values are determined using quoted market prices, relevant transaction evidence or valuation techniques, as appropriate to the instrument.
The amounts disclosed in the above table for trade and other receivables and trade and other payables do not agree to the amount reported in the Company’s Consolidated Statement of Financial Position as they exclude prepaid expenses, payroll liabilities and sales tax payable, current tax receivables and contract assets and liabilities which do not meet the definition of financial assets or liabilities.
Fair value measurements
The Group measures certain financial instruments at fair value at each reporting date. The following table summarizes those instruments by level within the fair value hierarchy:
Schedule of fair value measurement
| June 30, 2026 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Financial assets at fair value through profit or loss | ||||||||||||||||
| Listed equity investment | – | – | ||||||||||||||
| Unlisted equity investment | – | – | ||||||||||||||
| Total financial assets | – | |||||||||||||||
| Financial liabilities at fair value through profit or loss | ||||||||||||||||
| Warrant derivative liabilities | – | – | ||||||||||||||
| Total financial liabilities | – | – | ||||||||||||||
Valuation techniques and significant unobservable inputs
Schedule of valuation technique significant unobserable inputs
| Level 3 instrument | Valuation technique | Significant unobservable inputs | Input / range | |||
| Unlisted equity investment (Ripple Labs, Inc. shares) | Fair value US$ | |||||
| Warrant derivative liability – PIPE convertible preference shares | Volatility | |||||
| Warrant derivative liability – ASEAN | Volatility | |||||
| Warrant derivative liability – AWN warrants. | Volatility |
Level 3 reconciliation
The following table reconciles the opening and closing balances of Level 3 instruments. Liabilities are shown as negative amounts.
Schedule of level 3 instruments
| Level 3 financial instruments | Unlisted equity investment | Warrant derivative liabilities | Total | |||||||||
| Balance at July 1, 2025 | – | – | – | |||||||||
| Purchases / issues | ( | ) | ( | ) | ||||||||
| Settlements / disposals | ( | ) | – | ( | ) | |||||||
| Gains / (losses) recognized in profit or loss | ( | ) | ( | ) | ( | ) | ||||||
| Gains / (losses) recognized in OCI | – | – | – | |||||||||
| Transfers into / out of Level 3 | – | – | – | |||||||||
| Balance at June 30, 2026 | ( | ) | ( | ) | ||||||||
(a) Financial risk management
The Group’s principal financial instruments are bank balances, cash and medium-term loans. The main purpose of these financial instruments is to manage the Group’s funding and liquidity requirements. The Group also has other financial instruments such as trade receivables and trade payables which arise directly from its operations.
The Group is exposed through its operations to the following financial risks:
| ● | Liquidity risk | |
| ● | Credit risk | |
| ● | Foreign currency risk | |
| ● | Interest rate risk | |
| ● | Market Risk |
The Board has overall responsibility for the establishment and oversight of the Group’s risk management framework. Policy for managing risks is set by the Chief Executive Officer and is implemented by the Group’s finance department. All risks are managed centrally with tight control of all financial matters.
| F-53 |
| Table of Contents |
(b) Liquidity risk
Liquidity
risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group considers that liquidity
risk is effectively managed and mitigated. The Group held unrestricted cash resources of $
The Group maintains near-term cash flow forecasts that enable it to identify its borrowing requirements so that remedial action can be taken if necessary.
With the upcoming cash requirements, the Company recently also embarked on a ‘Sum of the Parts’ exercise to identify undervalued assets and determine ways to monetize them separately. These efforts include, but are not limited to:
| ○ | Spinning
Tembo off independently via a SPAC, which has been valued at $ | |
| ○ | Energi
Holding’s acquisition of a | |
| ○ | Further approaches to the market for the sale of VivoPower shares. | |
| ○ | Increasing revenue and revenue sources from the current Bitcoin mining operation at the Mo i Rana facility | |
| ○ | Working with potential investors, currently under NDA’s, to invest in both Tembo and VivoPower directly to take advantage of our current stock price. |
Contractual maturities of financial liabilities, including interest payments, are as follows:
Schedule of detailed information about the maturity of financial liabilities
| Year Ended June 30, 2026 | Less than | More than | ||||||||||||||||||
| (US dollars in thousands) | Total | 1 year | 1-3 years | 3-5 years | 5 years | |||||||||||||||
| Contractual maturity of financial liabilities | ||||||||||||||||||||
| Trade and other payables (financial liabilities) | - | - | - | |||||||||||||||||
| Borrowings | - | - | ||||||||||||||||||
| Lease liabilities | - | - | ||||||||||||||||||
| Total | - | - | ||||||||||||||||||
| Year Ended June 30, 2025 | Less than | More than | ||||||||||||||||||
| (US dollars in thousands) | Total | 1 year | 1-3 years | 3-5 years | 5 years | |||||||||||||||
| Contractual maturity of financial liabilities | ||||||||||||||||||||
| Trade and other payables (financial liabilities) | - | - | ||||||||||||||||||
| Borrowings | - | - | ||||||||||||||||||
| Lease liabilities | - | |||||||||||||||||||
| Total | - | |||||||||||||||||||
| Year Ended June 30, 2024 | Less than | More than | ||||||||||||||||||
| (US dollars in thousands) | Total | 1 year | 1-3 years | 3-5 years | 5 years | |||||||||||||||
| Contractual maturity of financial liabilities | ||||||||||||||||||||
| Trade and other payables (financial liabilities) | - | - | - | |||||||||||||||||
| Borrowings | - | |||||||||||||||||||
| Lease liabilities | - | - | - | - | - | |||||||||||||||
| Total | - | |||||||||||||||||||
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(c) Credit risk
Management monitors the settlement status, ageing, counterparty financial condition and available external information for material receivables. Credit risk for other customers is reviewed before contracts are entered into and exposures are monitored by Group finance and the local entities on a monthly basis.
The Group defines “default” consistently with its internal credit risk management practices and in a manner aligned with IFRS 9 requirements. A financial asset is considered to be in default when one or more of the following criteria are met:
● Quantitative criterion: The borrower is more than 90 days past due on its contractual payments of principal or interest;
● Qualitative criterion: There is evidence that the borrower is unlikely to pay its credit obligations in full without realization of collateral, such as:
○ Breach of covenants or significant deterioration in financial condition;
○ Initiation of bankruptcy or similar proceedings; or
○ A formal declaration of default by the Group.
The 90-day past-due criterion was selected because it is generally consistent with regulatory definitions of default and provides an appropriate, objective threshold that reflects the point at which credit losses become likely to occur. The qualitative indicators ensure that default is also captured earlier where known credit deterioration is evident even if contractual payments are not yet past due.
The Group regularly reviews its definition of default to ensure alignment with emerging credit risk management practices and regulatory expectations.
Financial assets are written off, in whole or in part, when the Group has no reasonable expectation of recovering the contractual cash flows, either through direct recovery efforts or from realization of collateral.
Indicators that there is no reasonable expectation of recovery include:
● The borrower has been liquidated or declared bankrupt, and available proceeds from the estate are insufficient to repay the asset in full;
● The Group’s collection efforts have been exhausted with no further expected recoveries; or
● The asset has remained non-performing for an extended period (typically 180 days past due for retail exposures and 360 days past due for corporate exposures), and no further cash flows are anticipated.
Write-offs are approved in accordance with the Group’s credit risk management policies and require appropriate authorization levels.
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Even after a financial asset has been written off, enforcement activities may continue in order to recover amounts due. Such recoveries are recognized in profit or loss when received.
Measurement of expected credit losses
The Group measures expected credit losses (“ECLs”) on its trade receivables, contract assets, the receivable from an investor in exchange for shares, and other financial assets. Depending on whether credit risk has increased significantly since initial recognition, the Group applies either 12-month ECLs or lifetime ECLs.
Twelve-month ECLs represent the expected credit losses arising from possible default events within the next 12 months, while lifetime ECLs reflect losses expected from all possible default events over the asset’s expected life. For trade receivables and contract assets, the Group applies the simplified approach under IFRS 9 and recognizes lifetime ECLs at all times. ECLs are estimated using historical loss rates adjusted for current and forward-looking information.
Assessment of significant increase in credit risk
For financial assets where the simplified approach does not apply—including the receivable from the investor—the Group assesses at each reporting date whether credit risk has increased significantly since initial recognition. The assessment considers quantitative and qualitative information such as ageing, payment patterns, changes in financial condition of the counterparty, and external credit information where relevant. A significant increase in credit risk is typically presumed when contractual amounts are more than 30 days past due, unless there is evidence to rebut this presumption.
Credit-impaired financial assets
A financial asset is assessed as credit-impaired when one or more events with a negative impact on the expected future cash flows have occurred. Indicators include significant financial difficulty of the counterparty, receivables more than 90 days past due, initiation of bankruptcy proceedings, or other observable data indicating a measurable decrease in expected cash flows. These indicators are applied consistently to trade receivables, contract assets, and the receivable from the investor.
Incorporation of forward-looking information
The ECL model incorporates forward-looking information by considering a range of possible future economic conditions. Macroeconomic variables relevant to the Group’s operations—such as expected changes in demand levels, inflation, interest rates, and general economic activity—are integrated into the loss estimates using probability-weighted scenarios. These assumptions are based on internal forecasts and external economic data sources. This ensures that the resulting ECL estimates reflect both historical trends and expected future economic conditions.
The Group’s liquidity, credit and foreign-currency exposures are significant in the context of the Group’s financial position. Liquidity risk is assessed as part of the Group’s overall financial risk management framework, taking into consideration its ability to meet its financial obligations as they fall due. Credit-risk concentration is described above, and a quantitative foreign-currency sensitivity analysis based on the monetary balances disclosed below is presented following the foreign-currency exposure.
(d) Foreign currency risk
The Group operates internationally and is exposed to foreign exchange risk on sales and purchases that are denominated in currencies other than the respective functional currencies of the Group entities to which they relate, primarily between USD, AUD, EUR, NOK and GBP.
The Group’s investments in overseas subsidiaries are not hedged as those currency positions are either USD denominated and/or considered to be long-term in nature.
The Group is exposed to foreign exchange risk on the following balances at June 30, 2026:
| ● | Cash
and cash equivalents $ |
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| Table of Contents |
| ● | Restricted
cash $ | |
| ● | Trade
and other receivables $ | |
| ● | Trade
and other payables $ |
Of
the total shareholder loan of $
(e) Interest rate risk
As a result of the related party loan agreement the Group is exposed to interest rate volatility. However, the interest rate is fixed for the medium term, therefore, the risk is largely mitigated for the near future. The Group will continue to monitor the movements in the wider global economy.
(f) Capital management
The Group’s objectives when managing capital are to support its ability to continue as a going concern, meet its financial obligations and finance its operating and investment activities. The Group manages its funding through a combination of equity, shareholder loans and other financing arrangements. Management reviews forecast cash flows, available cash resources, debt maturities and anticipated funding requirements to identify financing needs and determine appropriate actions. These actions may include raising equity or debt, refinancing or settling existing obligations, and monetizing investments or other assets. The Board has overall responsibility for oversight of the Group’s financial risk management framework, with policies implemented centrally by the finance department.
The principal components of the Group’s capital and financing position were as follows:
Schedule of capital and financing position
| US dollars in thousands | June 30, 2026 | June 30, 2025, restated | June 30, 2024 | |||||||||
| Total equity / (deficit) | ( | ) | ||||||||||
| Loans and borrowings | ||||||||||||
| Lease liabilities | — | |||||||||||
During the year, the Group’s financing activities included the issuance of ordinary shares, convertible preference shares and warrants. Total equity increased principally through these issuances and other equity movements, partially offset by the loss for the year. Lease liabilities increased principally as a result of the acquisition of the Norwegian data center business. The Group’s funding priorities developed during the year to support its transition toward digital infrastructure while continuing to address existing corporate obligations.
Subsequent
to June 30, 2026, the Group retired approximately $
The Group’s financing arrangements include security, repayment and mandatory prepayment provisions, including provisions triggered by qualifying liquidity events. These terms are considered when assessing available funding and the use of financing proceeds. Restrictions on distributions from subsidiaries may also affect the availability of funds at the parent company level. Further information on financing terms, equity transactions, liquidity management and subsequent financing activities is provided in Notes 26, 27, 31, 32 and 33.
There were no changes in the Group’s objectives, policies or processes for managing capital during the year ended June 30, 2026
(g) Market Risk
Bitcoin price risk: Nordland Data receives a share of the bitcoin mined under the Corner hosting agreement as a compute-based fee, measured at fair value on each service day. Our hosting revenue therefore varies with the market price of bitcoin. We do not hedge this exposure.
Equity price risk: The fair value of our warrant liabilities depends on our share price, and changes in fair value are recognized in profit or loss. We do not hedge this exposure.
32. Related party transactions
Arowana
Group Holdings Pty Ltd (AWN) is no longer the ultimate controlling party of VivoPower however it does retain significant influence. As
at June 30, 2026, AWN holds a
Kevin Chin, Chairman and Chief Executive Officer of VivoPower, is also Chief Executive Officer of AWN. During the period, a number of services were provided to the Company from AWN and its subsidiaries; the extent of the transactions between the two groups is listed below. Mr. Chin recused himself from these activities to ensure there was no conflict of interest.
On June 30, 2021, the Company agreed to refinance
its existing $
On January 11, 2023, amendments to the related party loan were agreed with AWN:
(i)
to defer repayment of principal to commence on April 1, 2025, with repayments over
(ii)
to defer interest payments from October 1, 2023, becoming due and payable on the earlier of a) completion by VivoPower of a debt or equity
raise of at least $
(iii)
to extend the increased interest rate and line fee of
(iv)
to extend the initial refinancing fee accruing incrementally at
(v)
to defer the repayment date of the previous fixed facility extension fee of $
(vi)
In addition to previously agreed refinancing fees, an additional $
On June 30, 2023, further amendments to the loan were agreed with AWN:
(i)
to defer interest payments from October 1, 2024 to April 1, 2025, and to replace the conditional requirement to repay accrued interest
upon completion by VivoPower of a debt or equity raise of at least $
(ii)
upon completion by VivoPower PLC of a qualifying liquidity event of at least $
a)
proceeds from $
b)
proceeds from $
c)
proceeds $
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| Table of Contents |
(iii) for the purposes of the mandatory prepayment requirement, a ‘qualifying liquidity event’ excludes direct investments into VivoPower’s subsidiary, Tembo, and debt raised in respect of working capital finance facilities, but includes:
a) equity or debt raise;
b) trade sale of underlying subsidiary or business unit (including, for example, Aevitas and Caret); and
c) loan repayment from Tembo to VivoPower.
(iv)
as consideration for the concessions agreed with AWN, VivoPower PLC committed to issue AWN with
On June 30, 2024, VivoPower amended its shareholder
loan financing agreement with AWN. At that date, the loan included a facility limit of $
Shareholder loan with AWN
Following the June 30, 2024 amendment, the AWN loan facilities were amended and restated under a Deed of Assignment, Novation and Amendment and Restatement dated on or about June 30, 2024. VivoPower PLC is the borrower and Aevitas O Holdings Pty Limited is a guarantor. Security granted to AWN comprises a debenture granted by VivoPower PLC; the Specific Security Deed granted by Aevitas O Holdings, including over its shares in Aevitas Group Limited; and a Jersey-law security agreement granted by VivoPower PLC, including over its shares in VivoPower International Services Limited.
The interest rate is
During the year the Company repaid $
In
December 2021, a short term loan of $
On
February 22, 2022, a short term $
On
December 22, 2022, a short term $
In
February and March 2023, further short term loans of AU$
Short-term loans with AWN
The short-term facilities described below were originally advanced to Aevitas O Holdings Pty Limited. The Deed of Assignment, Novation and Amendment and Restatement referred to above is a contractual loan document and is distinct from the accounting restatement described in Note 35 to the consolidated financial statements.
The
December 2021 loan of AU$
The
February 22, 2022 loan of $
The
December 22, 2022 loan of $
The
February and March 2023 loans of AU$
The
July 2023 loans of AU$
On July 1, 2026, the deed of company arrangement (DOCA) for KESW SO Pty Ltd (formerly Kenshaw Solar Pty Ltd) was wholly effectuated. As disclosed in Note 33, related-party creditors did not participate in the distribution, and all remaining claims against KESW SO Pty Ltd were extinguished upon effectuation of the DOCA. Accordingly, the outstanding amounts relating to the Kenshaw Solar facilities covered by the DOCA, including any associated deferred interest, were extinguished on July 1, 2026, with no further amount payable in respect of those extinguished obligations.
Total
owed to AWN at June 30, 2026 was $
The
detailed shareholder loan disclosures in Note 26 report FY2026 interest expense, including line and refinancing fees, of $
As
described in Item 5 and Note 33, in July and August 2026, $
Historically,
Aevitas issued
| F-58 |
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Chairman’s
fees for Kevin Chin in the amount of £
Historically, Mr.
Chin’s CEO remuneration comprised £
As CEO, Mr. Chin is paid fees through Arowana International UK Limited. For the year ended June 30, 2026, the amount was £
During
the year ended June 30, 2026, director fees for Peter Jeavons, William Langdon and Michael Hui were $
Mr.
Chin received equity-based remuneration following his appointment as Chief Executive Officer in March 2020. Of the
Equity-based remuneration
During
the year, the Company granted Kevin Chin
Each
of the three non-executive directors received
The
DSUs vested on August 21, 2026. As of the date of this report, the
On
November 26, 2021, AGI provided a loan of $
In
August 2023, the Company received short-term funding from Arowana International UK Limited amounting to £
Other Arowana loans
Loan
agreements dated June 29, 2024
Terms
of the agreements include interest of
At
June 30, 2026, VivoPower owed $
33. Subsequent events
| ● | KESW
SO Pty Ltd: On July 1, 2026, the deed of company arrangement for KESW SO Pty Ltd (formerly
Kenshaw Solar Pty Ltd), a dormant subsidiary within the discontinued Critical Power Services
business, was wholly effectuated. The company had entered voluntary administration on December
2, 2025 and the deed was executed on February 6, 2026. Under the deed, the Company contributed
A$ | |
| ● | PIPE 2: In July 2026, VivoPower received proceeds under Regulation S and CPS subscriptions (CPS 2)from institutional investors based in the US, EU, UK and Nordic countries. AWN Holdings also subscribed for CPS against amounts outstanding under its loan to VivoPower. | |
| ● | AWN
Holdings Limited: In July 2026, the Company fully retired the remaining US$ | |
| ● | Ceres:
On July 7, 2026, VivoPower received approximately US$ | |
| ● | On 20 July 2026, Syed Muhammad Nouman, FCA, was appointed Group Finance Director with effect from that date. He also serves as Principal Financial Officer and Principal Accounting Officer for the purposes of the Company’s SEC reporting obligations. His appointment was ratified by the Audit Committee. | |
| ● | As
at 30 June 2026, US$ | |
| ● | On
29 July 2026, the Company entered into definitive agreements for a further US$ | |
| ● | On
3 August 2026, the Company fully retired the remaining US$ |
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Other material matters
Management has continued to assess developments relating to the proposed Tembo business combination and independent listing up to the date of authorization of these financial statements. As no sufficiently substantive completed transaction or other specific material post-reporting-date event had occurred requiring separate disclosure under IAS 10, no additional subsequent-event disclosure has been included in respect of the proposed transaction.
34. Key management personnel compensation
Key management personnel, which are those roles that have a Group management aspect to them, are included in Note 9 to the consolidated financial statements.
35. Restatement of previously issued financial statements
During the preparation of the Company’s consolidated financial statements for the fiscal year ended June 30, 2026, certain historical accounting adjustments were identified during the Group audit. In accordance with Staff Accounting Bulletin (“SAB”) 99, Materiality, and SAB 108, Considering the Effects of Prior Period Misstatements when Quantifying Misstatements in Current Period Financial Statements, management evaluated these errors from both qualitative and quantitative perspectives and concluded that their impact was material to the Group’s consolidated financial statements for the fiscal year ended June 30, 2025. Comparative financial information has accordingly been restated. The schedules below present a detailed item-by-item breakdown of the restatement adjustments, including debit and credit accounting heads, impacted financial statement line items, and financial statement reconciliations.
Nature of the restatement adjustments
(US dollars in thousands)
Schedule of Restatement Adjustments
| Ref. | Nature of adjustment | Amount | Financial statement effect | |||||
| (i) | Internal salaries and wages incorrectly capitalized as intangible assets were derecognized and charged to general and administrative expenses. | Decrease in intangible assets; increase in expenses. | ||||||
| (ii) | Commission incorrectly recognized in other debtors was derecognized and charged to general and administrative expenses. | Decrease in trade and other receivables; increase in expenses. | ||||||
| (iii) | Vehicles and the corresponding trade payables were derecognized where the entity lacked legal control and title. | Decrease in property, plant and equipment and trade payables; no impact on profit or loss. | ||||||
| (iv) | Prepaid consulting expenses were charged to general and administrative expenses because the underlying services had been fully rendered. | Decrease in prepayments; increase in expenses. | ||||||
| (v-a) | Current fiscal provisions were offset against VAT receivable balances. | Decrease in current assets and current liabilities; no impact on profit or loss. | ||||||
| (v-b) | Current other liabilities were offset against VAT receivable balances. | Decrease in current assets and current liabilities; no impact on profit or loss. | ||||||
| (vi) | Share capital and share premium relating to the Ceres Holding Limited subscription arrangement were reclassified to a share subscription equity reserve. | Reclassification within equity; no impact on total equity. | ||||||
| Net increase in loss and accumulated deficit | Reduction in net assets. | |||||||
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At
June 30, 2025, $
Effect on the consolidated balance sheet at June 30 2025
Net adjustments in the reconciliation tables are calculated as the amount previously reported less the restated amount.
Schedule of Net Adjustments Reconciliation
| (US dollars in thousands) | As
previously reported | Restated | Net adjustment | Adjustment reference | ||||||||||
| Assets | ||||||||||||||
| Non-current assets | ||||||||||||||
| Property, plant and equipment, net | Adj (iii) | |||||||||||||
| Intangible assets, net | Adj (i) | |||||||||||||
| Deferred tax assets, net | - | - | ||||||||||||
| Total non-current assets | ||||||||||||||
| Current assets | ||||||||||||||
| Cash and cash equivalents | - | - | ||||||||||||
| Restricted cash | - | - | ||||||||||||
| Trade and other receivables | Adj (ii), (iv), (v-a, b) | |||||||||||||
| Inventory | - | - | ||||||||||||
| Digital assets | - | - | ||||||||||||
| Total current assets | ||||||||||||||
| Total assets | ||||||||||||||
| Liabilities And Equity | ||||||||||||||
| Current liabilities | ||||||||||||||
| Trade and other payables | Adj (iii), (v-b) | |||||||||||||
| Income tax liability | - | - | ||||||||||||
| Provisions | Adj (v-a) | |||||||||||||
| Loans and borrowings | - | - | ||||||||||||
| Total current liabilities | ||||||||||||||
| Non-current liabilities | ||||||||||||||
| Other payables | - | - | ||||||||||||
| Provisions | - | - | ||||||||||||
| Loans and borrowings | - | - | ||||||||||||
| Deferred tax liabilities | - | - | ||||||||||||
| Total non-current liabilities | - | |||||||||||||
| Total liabilities | ||||||||||||||
| Equity | ||||||||||||||
| Share capital | Adj (vi) | |||||||||||||
| Share premium | Adj (vi) | |||||||||||||
| Cumulative translation reserve | ( | ) | ( | ) | - | - | ||||||||
| Share subscription equity reserve | - | ( | ) | Adj (vi) | ||||||||||
| Other reserves | ( | ) | ( | ) | - | - | ||||||||
| Accumulated deficit | ( | ) | ( | ) | Adj (i), (ii), (iv) | |||||||||
| Equity and reserves attributable to owners | ||||||||||||||
| Total equity | ||||||||||||||
| Total equity and liabilities | ||||||||||||||
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Effect on the consolidated statement of comprehensive income for the year ended June 30, 2025
Schedule Of Effect On Consolidated Statement Of Comprehensive Income
| (US dollars in thousands) | As
previously reported | Restated | Net adjustment | Adjustment reference | ||||||||||
| General and administrative expenses | ( | ) | ( | ) | Adj (i), (ii), (iv) | |||||||||
| Subtotal of affected income and expense line items | ( | ) | ( | ) | Total P&L Restatement | |||||||||
| Total comprehensive loss attributable to owners | ( | ) | ( | ) | ||||||||||
Effect on earnings and loss per share
Following the restatement adjustments totaling $
Schedule Of Effect On Earnings And Loss Per Share
| (US dollars in thousands) | As previously reported | Restated | ||||||
| Loss from continuing operations | ( | ) | ( | ) | ||||
| Profit from discontinued operations | ||||||||
| Loss for the year | ( | ) | ( | ) | ||||
| Weighted average Class A Ordinary Shares | ||||||||
| Basic and diluted loss per share from continuing operations (US$) | ( | ) | ( | ) | ||||
| Basic and diluted earnings per share from discontinued operations (US$) | ||||||||
| Basic and diluted loss per share for the year (US$) | ( | ) | ( | ) | ||||
Effect on the consolidated statement of changes in equity
The
restatement increased the previously reported accumulated deficit of $
Effect on consolidated statements of cash flow
Schedule of Effect on Cash Balances
| (US dollars in thousands) | As previously reported | Restated | Net adjustment | Adjustment reference | ||||||||||
| Loss from continuing operations | ( | ) | ( | ) | Adj (i), (ii), (iv) | |||||||||
| Trade and other receivables | ( | ) | ( | ) | ( | ) | Adj (ii), (iv), (v-a, b) | |||||||
| Trade and other payables and provisions | ( | ) | ( | ) | Adj (iii), (v-a, b) | |||||||||
| Impact on cash generated from operations | - | - | ||||||||||||
| Purchase of property, plant and equipment | ( | ) | ( | ) | ( | ) | Adj (iii) | |||||||
| Investment in capital projects | ( | ) | ( | ) | ( | ) | Adj (i) | |||||||
| Impact on cash used in investing activities | - | - | ( | ) | ||||||||||
The
restatement did not affect the closing cash balances at June 30, 2025. Cash and cash equivalents remained $
36. Ultimate controlling party
Since June 30, 2021, the Company no longer has an ultimate controlling party.
In prior periods, the ultimate controlling party and the results into which these financials were consolidated was AWN, a company registered in Australia.
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