Mr. Cameron Groome reports

MICROBIX REPORTS RESULTS FOR Q1 2026

Microbix Biosystems Inc. has released results for its first quarter of fiscal 2026 ended Dec. 31, 2025 (Q1). Results for Q1 demonstrated the company's efforts to rebuild revenues back above its breakeven point following two client setbacks in mid-2025, with revenue growth of 13 per cent compared with Q4 fiscal 2025. Q1 revenues and net loss were as budgeted for fiscal 2026.

Management discussion

Microbix is prepared for material sales growth following additions to its capabilities and capacity. It is now at work on adding new client programs and clients to counter setbacks with two large clients in 2025. Progress with business development will be announced when secured. Microbix currently anticipates full-year fiscal 2026 results in-line with the forward-looking information (FLI) disclosed in its management discussion and analysis (MD&A), toward rebuilding sales above its earnings breakeven point.

Quarter ending Dec. 31, 2025 (Q1)

Q1 revenue was $4,218,909, an increase of 13 per cent over the prior quarter (Q4 2025) but a 30-per-cent decrease from Q1 2025 revenues of $6,044,002. Included were antigen revenues of $2,174,357 (2025 -- $4,266,758), which were down 49 per cent from last year due to a $2-million reduction of sales to the company's distributor into China. Sales to other antigen customers were up 5 per cent compared with the prior year period. QAPs revenues of $1,876,276 were up 15 per cent from Q1 2025 ($1,626,980), primarily due to a doubling of sales of branded QAPs products (REDx and PROCEEDx) versus Q1 2025. Revenue from royalties were $168,276 (2025 -- $150,263). In summary, the company's Q1 was impacted by a large decrease in sales into China, which was partly offset by increased sales for QAPs (inclusive of QUANTDx and reagents).

Q1 gross margin percentage was 41 per cent, down from 62 per cent in 2025, primarily due to decreased product sales which resulted in fixed manufacturing costs needing to be absorbed across fewer units of production.

Operating expenses (including finance expenses) in Q1 were relatively flat compared with Q1 2025, principally due to increased net financing costs versus prior year, due to lower interest income as a result of lower interest rates on decreased short-term investments.

Over all, weaker Q1 revenues and decreased margins led to an operating and net loss of $1,167,177 versus a Q1 2025 operating and net income of $856,962. Cash used in operating activities was $2,602,403, compared with cash provided by operating activities of $792,702 in 2025. Much of the cash used in operating activities during the quarter was consumed by increasing accounts receivable, which grew by $2,373,886 since Sept. 30, 2025, and stood at $3,984,395 as at Dec. 31, 2025. At the end of Q1, Microbix's current ratio (current assets divided by current liabilities) was 7.51 and its debt-to-equity ratio (total debt over shareholders' equity) was 0.38.

Corporate outlook

Microbix is aggressively pursuing new client programs and new clients, while continuing to add to its portfolio of products and services, and its capabilities. It thereby intends to continue driving sales growth across all of its business lines, while also improving percentage gross margins and working to deliver bottom-line results. Microbix's goal is to create meaningful and sustained shareholder value within both its diagnostics-oriented business and its fully financed Kinlytic urokinase thrombolytic drug program.

Furthermore, at 10 a.m. ET on Thursday, Feb. 12, 2026, Microbix intends to hold a webinar discussion of Q1 2026 results with its chief executive officer, chief financial officer and chief operating officer.

Investor and shareholders can participate in the webinar, hosted by Adelaide Capital, by registering on-line. It will also be live-streamed to YouTube.

A replay of the webinar will also be made available on Adelaide Capital's YouTube channel.

About Microbix Biosystems Inc.

Microbix Biosystems creates proprietary biological products for human health, with over 120 skilled employees and revenues of $18.6-million in its latest fiscal year (2025). It makes a wide range of critical ingredients and devices for the global diagnostics industry, notably antigens for immunoassays, and its laboratory quality assessment products (QAPs) and reference materials (QUANTDx) that support clinical lab proficiency testing, enable assay development and validation, or help ensure the quality of clinical diagnostic workflows. Its antigens drive the antibody tests of approximately 100 diagnostics makers, while QAPs or QUANTDx are sold to clinical lab accreditation organizations, diagnostics companies and clinical labs. Microbix QAPs are now available in over 30 countries, supported by a network of international distributors. Microbix is ISO 9001 and 13485 accredited, U.S. Food and Drug Administration-registered, Australian TGA-registered, Health Canada-establishment-licensed, and provides IVDR-compliant CE-marked products.

Microbix also applies its biological expertise and infrastructure to develop other proprietary products and technologies, most notably Kinlytic urokinase, a biologic thrombolytic drug used to resolve blood clots, and reagents or medial to support diagnostic testing (for example, its DxTM for patient-sample collection). Microbix is traded on the Toronto Stock Exchange and OTCQX, and headquartered in Mississauga, Ont., Canada.

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