Final Results
02 June 2026
ENGAGE XR Holdings Plc (AIM: EXR), a leading provider of immersive communications technology, announces its audited results for the year ended 31 December 2025.
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Financial Highlights:
- Total revenue of €1.9 million (2024: €3.3 million), reflecting an 43% decline due to a changing focus in the Middle East market and a reduction in Enterprise demand globally.
- Gross margin of 93% (2024: 86%).
- EBITDA loss reduced to €2.8 million (2024: €3.9 million), reflecting disciplined cost control. Expected EBITDA loss reported in January 2026 was c €2.4m but a bad debt in the Middle East post year end increased the EBITDA loss to €2.8m
- Cash position of €1.6 million at 31 December 2025 (2024: €3.6 million), with no debt.
Operational Highlights:
- Launch of comprehensive education offering at BETT conference in London in January 2025.
- Participation and collaboration at BETT conference, ASU+GSV Summit and Leap 2025 with key partners including Meta and PWC.
Current trading and Outlook:
- Significant renewal by the Group’s largest customer in May 2026 will improve the short-term cash position of the Group
- Renewals or new contracts signed with significant customers in 2026 to date include Bank of America, Optima Ed, University of Miami and a Fortune 500 technology company.
David Whelan, CEO of ENGAGE XR, commented: “Overall, 2025 was another challenging year for the Company across multiple fronts due to continued headwinds, especially from the further erosion in renewals from the Company’s enterprise clients. The Board recognises the need to deliver improved performance and value for our shareholders over the long term and therefore as a board we will continue to explore initiatives to deliver on this objective.
Notwithstanding the headwinds the Company is confronting, especially in the Enterprise space, as a management team, we continue to believe that the Education sector provides and important opportunity for the Company and one where the Board is focused on enhancing value for ENGAGE's proposition. We believe that the ENGAGE platform is relevant across schools, universities and the homeschool market, with the United States likely to be a key geographic opportunity for the Company.”
For further information, please contact:
ENGAGE XR Holdings Plc |
Tel: +353 87 665 6708 |
Cavendish Capital Markets Limited Marc Milmo/ Seamus Fricker/ Andrea Callaghan (Corporate finance) |
Tel: +44 (0) 20 7220 0500 |
About ENGAGE XR
ENGAGE XR Holdings plc (AIM: EXR) has developed ENGAGE, an immersive training, education and collaboration platform, offering cutting-edge VR/AR tools and environments that elevate employee training and student outcomes. Trusted by enterprise and educational clients worldwide, ENGAGE leverages the transformative power of spatial computing to revolutionize onboarding, sales meetings, product demos and a host of other vital business operations.
For further information, please visit: https://engagevr.io/
CHAIRMAN'S STATEMENT
On behalf of the Board of ENGAGE XR Holdings plc, I am pleased to present our Annual Report and Financial Statements for the year ended 31 December 2025. This was, without question, another challenging year for the Group — one in which we confronted significant external headwinds, recalibrated our cost base, and sharpened our strategic focus on the markets and product capabilities that we believe offer the most durable long-term value for shareholders.
Trading performance fell short of the expectations we held at the start of the year. The principal causes were two-fold. The first was the global slowdown in hiring, especially across the technology sector with several of the Group’s larger enterprise clients either renewing at materially lower levels or not renewing at all. The second was the delay of major tourism training contracts in the Middle East. The current regional conflict has further materially altered the near-term demand environment for immersive services from this region. While disappointing, it has served to accelerate a strategic pivot that the Board considers necessary and correct: a deliberate move away from volatile, project-based revenues toward a more predictable, subscription-led model anchored in education and training.
2025 Performance
Group revenue for the year was €1.94 million, compared to €3.40 million in 2024, a reduction of 43%. Recurring revenue from our core ENGAGE education customer base held firm at €1.3 million, demonstrating the resilience of our subscription franchise. The decline was concentrated in Enterprise revenue, which fell from €1.0 million to €0.3 million enterprise customer renewals eroded and in Professional Services, which reduced from €0.7 million to €0.1 million as the Group consciously stepped back from one-off VR event and bespoke development work.
Gross margin improved meaningfully to 93% (2024: 86%), reflecting the higher-quality revenue mix as the business tilts toward software licensing. The EBITDA loss reduced to €2.8 million (2024: €3.9 million) however reported loss before tax improved to €3.0 million (2024: €4.0 million), the result of disciplined cost action across the organisation. Operating cash outflow was €1.9 million for the period, less than half the €4.3 million outflow recorded in 2024.
The Group closed the year with cash of €1.6 million (2024: €3.6 million) and no debt resulting from continued operating loss. Trade receivables stood at €0.5 million against trade payables of €0.3 million, with debtor days reduced from 57 to 21 — a clear indicator of the tighter working capital discipline implemented across the business.
Strategic Repositioning
During the year management acted decisively to reshape the cost base. A restructuring undertaken in May 2025 reduced headcount from approximately 50 in mid-2024 to approximately 30 core staff today, and the run-rate of monthly operating costs has been brought down to approximately €0.2 million for the remainder of 2026. These were difficult decisions, and on behalf of the Board I would like to record our thanks to colleagues who left the business during the year for their contribution to ENGAGE XR.
With our cost base now appropriately sized, the Group is concentrating its energies on the two areas where we see the clearest path to scalable, recurring revenue: enhancing our immersive platform for education and training customers and bringing our AI Teacher proposition to market.
Our geographic focus has shifted in step. North America now accounts for 62% of ENGAGE revenue (2024: 32%), as we have redirected commercial attention to a region where adoption of immersive learning is most advanced and where we hold a strong installed base. Middle East revenue, at 11% of the total, will remain an important but more measured component of the mix until conditions in the region stabilise.
Innovation and the AI Opportunity
The Board believes that the convergence of immersive technology with generative artificial intelligence represents the most significant opportunity in our addressable market. Our AI Teacher programme, together with the no-code Experience Editor and forthcoming PowerPoint-to-immersive conversion capability, positions ENGAGE XR to offer educators something that no competitor today can credibly deliver at scale: a measurable, ROI-led platform on which AI-driven instruction is always supervised by a human teacher. Research and development investment of €1.56 million (2024: €2.04 million) underpinned a substantial upgrade to our technology stack during the year. This investment is already being rewarded in higher subscription pricing on renewal, and the medium-term ambition remains an average contract value in excess of €25,000.
Trading Since the Year End
As noted above, the Group’s opportunities in the Middle East have clearly been impacted by the ongoing conflict in the region. Notwithstanding this, the Board is pleased that during 2026 the Group has been able to deliver a number of customer renewals and contract wins in North America. The Group has secured contract wins and renewals with a number of notable customers including Bank of America, the University of Miami, and a Fortune 500 Technology company. Importantly, a significant renewal by the Group’s largest customer in May 2026, on enhanced commercial terms, will improve the short-term cash position of the Group, once funds are received later in the year. The outcome is that the performance for the current financial year will be second half weighted as the majority of revenue from these recent wins is expected to be recognised in the second half of 2026.
Governance, People and Stakeholders
The Board currently comprises seven Directors, with a balance of executive leadership and non-executive challenge. The Group continues to apply the Quoted Companies Alliance Corporate Governance Code, and during the year the Board met formally on five occasions with a strong attendance record. We continue to keep the composition and effectiveness of the Board under review, and intend to formalise our annual performance evaluation in the coming year.
On behalf of the Board, I would like to thank David Whelan and the entire ENGAGE XR team for their resilience, focus and commitment during what has been a demanding year. I would also like to thank our customers, partners, our Nominated Adviser and our advisers for their continued support, and you, our shareholders, for your patience and confidence as we reshape the business for the next phase of its growth.
Board Change
Non-Executive Director Kenny Jacobs will not seek re-election to the Board at the AGM on 25 June 2026. The Board would like to thank Kenny for his efforts and expertise over the past 4 years and wishes him well with his future endeavours.
Outlook
ENGAGE XR enters the second half of 2026 a leaner, more focused and more technologically capable business than at any point in its history. The structural drivers of our market — the proven effectiveness of immersive learning, the rapid maturation of generative AI, and the imperative for educators to deliver measurable outcomes at scale — are firmly in our favour. The Board is confident that the actions taken during 2025, combined with the commercial momentum now building, position the Group to deliver sustainable, recurring revenue growth and, in time, attractive returns for our shareholders.
Karthik Manimozhi
Non-Executive Chairman
2 June 2026
CHIEF EXECUTIVE’S REVIEW
Overview
The 2025 financial year was a period of significant transition and recalibration for ENGAGE XR. We recorded a total revenue of €1.94m, a decrease from the €3.40m achieved in 2024. The principal causes were two fold. The first was the global slowdown in hiring, especially across the technology sector with several of the Group’s larger enterprise clients either renewing at materially lower levels or not renewing at all. The second was the delay of major tourism training contracts in the Middle East. However, this shift has led to the Board to move the Group away from volatile, project-based revenue toward engagement with customers on a subscription basis thereby affording the Group a more stable and scalable future.
We have proactively adjusted our operations, significantly reduced our cost base and streamlined our organisation to approximately 30 core staff. This leaner structure has positioned the company to reduce cash burn and grow into H2 2026 and into 2027.
Our path forward is bolstered by significant client renewals at significantly increased subscription rates and the expanding sale of licenses within the education and training sectors. Key contracts / renewals signed so far in 2026 have been Bank of America, University of Miami, and a Fortune 500 technology company most of which will be revenue recognized in the second half of this year with expectations of further growth with new clients in our pipeline and recurring client growth using the platform.
Although revenue decreased in 2025, for reasons already mentioned, we have bolstered our technical capabilities with a much improved technology stack which in turn allows us to command a higher price subscription fee for the newly enhanced platform for our clients who value the increased security and feature that the platform now offers
AI Teacher Coming Soon
Our strategic priority is now our AI Teacher programme, which is the operating system for the future of education. This initiative addresses a critical inefficiency in the sector: approximately 60% of a teacher's time is currently spent delivering repetitive, lecture style content. By deploying AI Teachers, we enable educators to automate these high frequency tasks, allowing them to focus on high impact, one on one student support or to scale remote class sizes without increasing teacher workloads.
Our technology allows real world teachers to create AI clones of themselves using existing materials or spatial recordings, ensuring the AI looks and sounds like the original educator. These AI Teachers maintain student specific memory, allowing lessons to resume exactly where a learner left off while reporting performance back to the human supervisor. Humans are always kept in the loop when it comes to a student education, and we do not leave it to generative AI tools to make assumptions and predictions as to how to navigate a subject matter.
We have been releasing our AI tools to educators across K12, Universities and Homeschools over the past 12 months and the educators within these organisations are actively building and testing AI Faculty bots which will be deployed and used with live students this coming academic year. This is a progression from our School of AI characters which have been successfully used in many schools across the US over the past 12 months.
Immersive Building Tools
Beyond the classroom, we are providing a massive scalability solution through our Experience Editor, a no code tool that enables educators to build custom immersive learning experiences themselves. We are currently completing a feature that will allow educators to upload standard PowerPoint presentations and have them automatically converted into interactive, immersive lessons led by an embodied AI Teacher. To ensure measurable outcomes, the system is designed to sync performance data directly with existing Learning Management Systems, such as Canvas, reducing administrative workloads while maintaining academic oversight. This creates a closed-loop architecture where instruction is AI-driven but human-supervised.
A fundamental pillar of our business case is student safety. Recognizing that students may perceive virtual classrooms as a private space, ENGAGE actively monitors interactions for inappropriate language or content. We use AI driven tools to flag concerning keywords and phrases, alerting real-world educators to students who may be experiencing challenges or maltreatment at home. Given that one in eight children in the USA will experience a confirmed case of maltreatment by age 18, our platform provides a vital, secure social outlet where struggling students can seek support.
Conclusion
Despite the slower than expected adoption of immersive technology in many commercial industries, its effectiveness in education is supported by compelling data. Learners using immersive technology have been shown to retain up to 75% of information, a significant increase over traditional methods, and can learn up to four times faster than in a standard classroom setting. Immersive training leads to a 275% increase in student confidence when applying new skills. By focusing on these proven benefits and our new AI capabilities, ENGAGE XR has moved past the worst of the market downturn and is building a sustainable, growing future for our shareholders and educational partners. Unlike many AI startups we are focused on selling measurable ROI not product. Get the ROI right and growth will follow.
David Whelan
Chief Executive Officer
2 June 2026
CHIEF FINANCIAL OFFICER’S REVIEW
Revenue was down 43% on the prior year from €3.4 million to €1.9 million, driven by a significant reduction in activity within the Middle East which had a significant impact on our performance.
ENGAGE revenue from education customers remained constant at €1.3 million in FY25.
ENGAGE revenue from Professional Services declined to €0.1 million from €0.7 million driven by a continued reduction in one off VR events supported by the ENGAGE Event team and also a reduction in custom VR development by the ENGAGE Studio Team.
ENGAGE revenue from Enterprise customers decreased from €1.0 million to €0.3 million, driven by the significant reduction of activity within the Middle East.
ENGAGE revenue within the North American market was 62% of total ENGAGE revenue (2024: 32%). This is due to a shift in focus from the Middle East where uncertainty in the region has lead the Group to focus attention back to North America. Revenue from the Middle East was 11% of total ENGAGE revenue (2023: 28%).
EBITDA loss was €2.8 million compared to a loss of €3.9 million in the prior year and loss before tax was €3.0 million compared to a loss in 2024 of €4.0 million. This reduced EBITDA loss is primarily driven by reductions in headcount and a disciplined approach to cost control across the Group, offsetting the reduction in revenue in the period.
Operating cashflows resulted in a net outflow of €1.9 million for the period (2024: €4.3m). Following recently undertaken cost reductions in Q2 2025, the current run-rate of staff costs and other ongoing costs is expected to be approximately €0.2 million per month for the remainder of 2026.
At the balance sheet date, trade and other receivables were €0.5 million, ahead of trade and other payables at €0.3 million. Trade receivables represented an average of 21 debtor days (2024: 57 days).
The Group’s cash position on 31 December 2025 was €1.6 million (2024: €3.6 million) with no debt.
Séamus Larrissey
Chief Financial Officer
2 June 2026
CONSOLIDATED STATEMENT OF TOTAL COMPREHENSIVE INCOME
for the Year Ended 31 December 2025
| Note | 2025 | 2024 | ||
| Continuing Operations | € | € | ||
| Revenue | 3 | 1,939,626 | 3,397,251 | |
| Cost of Sales | 5 | (129,992) | (476,728) | |
| Gross Profit | 1,809,634 | 2,920,523 | ||
| Administrative Expenses | 5 | (4,846,534) | (7,104,692) | |
| Operating Loss | (3,036,900) | (4,184,169) | ||
| Finance Income | 9 | 62,759 | 216,122 | |
| Finance Costs | 8 | (6,509) | (6,449) | |
| Loss before Income Tax | (2,980,650) | (3,974,496) | ||
| Income Tax credit | 10 | - | - | |
| Loss for the financial year | (2,980,650) | (3,974,496) | ||
| Other comprehensive income | - | - | ||
| Total comprehensive loss for the year attributable to owners of the parent | (2,980,650) | (3,974,496) | ||
| Earnings per Share (EPS) attributable to owners of the parent | ||||
| Basic earnings per share Diluted earnings per share |
11 11 |
(0.006) (0.005) |
(0.008) (0.007) |
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
at 31 December 2025
| Note | 2025 | 2024 | ||
| € | € | |||
| Non-Current Assets | ||||
| Property, Plant & Equipment | 12 | 34,404 | 56,417 | |
| Intangible Assets | 13 | - | - | |
| 34,404 | 56,417 | |||
| Current Assets | ||||
| Trade and other receivables | 15 | 545,711 | 1,786,684 | |
| Cash and short-term deposits | 16 | 1,623,843 | 3,566,927 | |
| 2,169,554 | 5,353,611 | |||
| Total Assets | 2,203,958 | 5,410,028 | ||
| Equity and Liabilities | ||||
| Equity Attributable to Shareholders | ||||
| Issued share capital | 17 | 524,826 | 524,826 | |
| Share premium | 17 | 43,910,062 | 43,910,062 | |
| Other reserves | 18 | (11,994,467) | (12,128,790) | |
| Retained earnings | 19 | (30,569,876) | (27,589,226) | |
| Total Equity | 1,870,545 | 4,716,872 | ||
| Non-Current Liabilities | ||||
| Lease liabilities | 21 | 12,068 | - | |
| Current Liabilities | ||||
| Trade and other payables | 22 | 307,035 | 658,616 | |
| Lease liabilities | 21 | 14,310 | 34,540 | |
| 321,345 | 693,156 | |||
| Total Liabilities | 333,413 | 693,156 | ||
| Total Equity and Liabilities | 2,203,958 | 5,410,028 |
COMPANY STATEMENT OF FINANCIAL POSITION
at 31 December 2025
|
Note | 2025 | 2024 | |
|
€ | € | ||
Non-Current Assets |
||||
Investment in subsidiaries |
14 | 2,865,430 | 3,635,844 | |
|
2,865,430 | 3,635,844 | ||
|
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Current Assets |
||||
Trade and other receivables |
15 | 437 | 12,930 | |
Cash and short-term deposits |
16 | 1,228,930 | 3,226,157 | |
| 1,229,367 | 3,239,087 | |||
Total Assets |
4,094,797 | 6,874,931 | ||
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Equity and Liabilities |
||||
|
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Equity Attributable to Shareholders |
||||
Issued share capital |
17 | 524,826 | 524,826 | |
Share premium |
17 | 43,910,062 | 43,910,062 | |
Other reserves |
18 | (999,596) | (1,119,279) | |
Retained earnings |
19 | (39,380,060) | (36,503,224) | |
Total Equity |
4,055,232 | 6,812,385 | ||
Current Liabilities |
||||
Trade and other payables |
22 | 39,565 | 62,546 | |
Total Liabilities |
39,565 | 62,546 | ||
Total Equity and Liabilities |
4,094,797 | 6,874,931 |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the Year Ended 31 December 2025
| Share Capital |
Share Premium |
Other Reserves | Retained Earnings |
Total | |
| € | € | € | € | € | |
| Balance at 1 January 2024 | 524,826 | 43,910,062 | (12,292,523) | (23,614,730) | 8,527,635 |
| Total comprehensive income | |||||
| Other comprehensive income | - | - | - | - | - |
| Loss for the year | - | - | - | (3,974,496) | (3,974,496) |
| Total comprehensive income | 524,826 | 43,910,062 | (12,292,523) | (27,589,226) | 4,553,139 |
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Transactions with owners recognised directly in equity |
|||||
| Share option expense | - | - | 163,733 | - | 163,733 |
| Balance at 31 December 2024 | 524,826 | 43,910,062 | (12,128,790) | (27,589,226) | 4,716,872 |
| Share Capital |
Share Premium |
Other Reserves | Retained Earnings |
Total | |
| € | € | € | € | € | |
| Balance at 1 January 2025 | 524,826 | 43,910,062 | (12,128,790) | (27,589,226) | 4,716,872 |
| Total comprehensive income | |||||
| Other comprehensive income | - | - | - | - | - |
| Loss for the year | - | - | - | (2,980,650) | (2,980,650) |
| Total comprehensive income | 524,826 | 43,910,062 | (12,128,790) | (30,569,876) | 1,736,222 |
|
Transactions with owners recognised directly in equity |
|||||
| Share option expense | - | - | 134,323 | - | 134,323 |
| Balance at 31 December 2025 | 524,826 | 43,910,062 | (11,994,467) | (30,569,876) | 1,870,545 |
COMPANY STATEMENT OF CHANGES IN EQUITY
for the Year Ended 31 December 2025
| Share Capital |
Share Premium |
Other Reserves | Retained Earnings |
Total | ||
| € | € | € | € | € | ||
| Balance at 1 January 2024 | 524,826 | 43,910,062 | (1,246,172) | (25,081,249) | 18,107,467 | |
| Total comprehensive income | ||||||
| Other comprehensive income - | - | - | - | - | ||
| Loss for the year | - | - | - | (11,421,975) | (11,421,975) | |
| Total comprehensive income | 524,826 | 43,910,062 | (1,246,172) | (36,503,224) | 6,685,492 | |
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Transactions with owners recognised directly in equity |
||||||
| Share option expense | - | - | 126,893 | - | 126,893 | |
| Balance at 31 December 2024 | 524,826 | 43,910,062 | (1,119,279) | (36,503,224) | 6,812,385 | |
| Share Capital |
Share Premium |
Other Reserves | Retained Earnings |
Total | ||
| € | € | € | € | € | ||
| Balance at 1 January 2025 | 524,826 | 43,910,062 | (1,119,279) | (36,503,224) | 6,812,385 | |
| Total comprehensive income | ||||||
| Other comprehensive income - | - | - | - | - | ||
| Loss for the year | - | - | - | (2,876,836) | (2,876,836) | |
| Total comprehensive income | 524,826 | 43,910,062 | (1,119,279) | (39,380,060) | 3,935,549 | |
|
Transactions with owners recognised directly in equity |
||||||
| Share option expense | - | - | 119,683 | - | 119,683 | |
| Balance at 31 December 2025 | 524,826 | 43,910,062 | (999,596) | (39,380,060) | 4,055,232 | |
CONSOLIDATED STATEMENT OF CASH FLOWS
for the Year Ended 31 December 2025
| Note | 2025 | 2024 | ||
| Continuing Operations | € | € | ||
| Loss before income tax | (2,980,650) | (3,974,496) | ||
| Adjustments to reconcile loss before tax to net cash flows: | ||||
| Depreciation of fixed assets | 5 | 56,766 | 91,398 | |
| Finance Costs | 8 | 6,509 | 6,449 | |
| Finance Income | 9 | (62,759) | (216,122) | |
| Share Option Expense | 134,323 | 163,733 | ||
| Movement in trade & other receivables | 1,240,974 | (591,351) | ||
| Movement in trade & other payables | (351,581) | 43,379 | ||
| (1,956,418) | (4,477,010) | |||
| Bank interest received | 62,759 | 216,122 | ||
| Bank interest & other charges paid | (6,509) | (6,449) | ||
| Net Cash used in Operating Activities | (1,900,168) | (4,267,337) | ||
| Cash Flows from Investing Activities | ||||
| Purchases of property, plant & equipment | 12 | - | (24,087) | |
| Net cash used in investing activities | - | (24,087) | ||
| Cash Flows from Financing Activities | ||||
| Proceeds from issuance of ordinary shares | - | - | ||
| Payment of lease liabilities | 21 | (42,916) | (52,728) | |
| Net cash generated used in financing activities | (42,916) | (52,728) | ||
| Net decrease in cash and cash equivalents | (1,943,084) | (4,344,152) | ||
| Cash and cash equivalents at beginning of year | 16 | 3,566,927 | 7,911,079 | |
| Cash and cash equivalents at end of year | 16 | 1,623,843 | 3,566,927 |
COMPANY STATEMENT OF CASH FLOWS
for the Year Ended 31 December 2025
| Note | 2025 | 2024 | ||
| Continuing Operations | € | € | ||
| Loss before income tax | (2,876,836) | (11,421,975) | ||
| Adjustments to reconcile loss before tax to net cash flows: | ||||
| Finance Costs | 615 | 722 | ||
| Finance Income | (60,381) | (212,386) | ||
| Share Option Expense | 119,683 | 126,893 | ||
| Impairment of Investment in Subsidiaries | 2,131,954 | 10,698,215 | ||
| Movement in trade & other receivables | 12,493 | 12,494 | ||
| Movement in trade & other payables | (22,981) | (13,645) | ||
| (695,453) | (809,682) | |||
| Bank interest received | 60,381 | 212,386 | ||
| Bank interest & other charges paid | (615) | (722) | ||
| Net cash used in Operating Activities | (635,687) | (598,018) | ||
| Cash Flows from Investing Activities | ||||
| Capital contribution | (1,361,540) | (1,967,466) | ||
| Net cash used in investing activities | (1,361,540) | (1,967,466) | ||
| Cash Flows from Financing Activities | ||||
| Proceeds from issuance of ordinary shares | - | - | ||
| Net cash generated from financing activities | - | - | ||
| Net decrease in cash and cash equivalents | (1,997,227) | (2,565,484) | ||
| Cash and cash equivalents at beginning of year | 16 | 3,226,157 | 5,791,641 | |
| Cash and cash equivalents at end of year | 16 | 1,228,930 | 3,226,157 |