Total Revenues Increase by 13%

Internal Testing of Secondary Transfer Feature Begins

Netcapital Inc. (NASDAQ:NCPL, NCPLW))) (the "Company"), a digital private capital markets ecosystem, today announced financial results for the first quarter of fiscal year 2024 ended July 31, 2023.

"We are delighted to announce a very strong quarter for our funding portal, delivering a more than doubling of revenue," said Martin Kay, CEO of Netcapital Inc. "In addition, we maintained our strategic focus on the build-out of the software required to enable issuers and investors on the Netcapital platform the ability to access a registered alternative trading system (ATS) in order to engage in secondary trading of securities. We commenced internal testing of the secondary trading platform features this week, and we are excited about the potential for this liquidity model to support the continued growth of both our investor and issuer communities."

First Quarter Fiscal 2024 Financial Highlights

Revenue growth of 13% year-over-year to $1.5 million, compared to revenue of $1.3 million in the first quarter of fiscal year 2023.
Year-over-year increase of 110% in revenue from our funding portal services, which increased by $197,356 to $375,856 in the three months ended July 31, 2023, compared to $178,500 in the three months ended July 31, 2022.
Net loss of approximately $492,000 in the three months ended July 31, 2023, compared to net income of approximately $65,000 in the three months ended July 31, 2022.
Diluted loss per share of $0.07 in the three months ended July 31, 2023, compared to diluted earnings per share of $0.02 in the three months ended July 31, 2022.
First quarter net loss was driven primarily by higher marketing spend and increased payroll expenses that included $483,351 in stock-based compensation in the three months ended July 31, 2023, as compared to $32,953 in the three months ended July 31, 2002.

For additional disclosure regarding Netcapital's operating results, please refer to the Quarterly Report on Form 10-Q for the period ended July 31, 2023, which has been filed with the Securities and Exchange Commission.

Conference Call Information

The Company will host an investor conference call at 10:00 a.m. ET on Friday, September 15, 2023.

Participant access:		844-985-2012 or 973-528-0138
Conference entry code:		580133

For those unable to participate in the live call, a replay will be made available in the Investors section of the Company's website.

About Netcapital Inc.

Netcapital Inc. is a fintech company with a scalable technology platform that allows private companies to raise capital online and provides private equity investment opportunities to investors. The Company's consulting group, Netcapital Advisors, provides marketing and strategic advice and takes equity positions in select companies. The Company's funding portal, Netcapital Funding Portal, Inc. is registered with the U.S. Securities & Exchange Commission (SEC) and is a member of the Financial Industry Regulatory Authority (FINRA), a registered national securities association.

The information contained herein includes forward-looking statements. These statements relate to future events or to our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. You should not place undue reliance on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and which could, and likely will, materially affect actual results, levels of activity, performance or achievements. Any forward-looking statement reflects our current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to our operations, results of operations, growth strategy and liquidity. We assume no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

Balance Sheet

Assets:		July 31, 2023		April 30, 2023
Cash and cash equivalents		$	1,030,618	$	569,441
Accounts receivable net			1,355,000		1,388,500
Prepaid expenses			444,837		583,030
	Total current assets		2,830,455		2,540,971

Deposits			6,300		6,300
Notes receivable - related parties			202,000		202,000
Purchased technology, net			15,846,966		15,875,297
Investment in affiliate			240,080		240,080
Equity securities at fair value			24,308,633		22,955,445
	Total assets	$	43,434,434	$	41,820,093

Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable
Trade		$	586,981	$	578,331
Related party			75,204		75,204
Accrued expenses			242,955		285,065
Stock subscription payable			10,000		10,000
Deferred revenue			600		661
Interest payable			86,185		98,256
Current taxes payable			-		174,000
Deferred tax liability, net			1,532,000		1,657,000
Related party debt			15,000		15,000
Secured note payable			-		350,000
Current portion of SBA loans			1,885,800		1,885,800
Loan payable - bank			34,324		34,324
	Total current liabilities		4,469,049		5,163,641

Long-term liabilities:
Long-term SBA loans, less current portion			500,000		500,000
	Total Liabilities		4,969,049		5,663,641

Commitments and contingencies			-		-

Stockholders' equity:
Common stock, $.001 par value; 900,000,000 shares
authorized, 9,434,132 and 6,440,777 shares issued and outstanding			9,434		6,441
Shares to be issued			183,187		183,187
Capital in excess of par value			33,298,539		30,500,944
Retained earnings			4,974,225		5,465,880
	Total stockholders' equity		38,465,385		36,156,452
Total liabilities and stockholders' equity		$	43,434,434	$	41,820,093

Income Statement

	Three Months Ended		Three Months Ended
	July 31, 2023		July 31, 2022

Revenues	$	1,519,809	$	1,340,573
Costs of services		18,053		21,063
Gross profit		1,501,756		1,319,510

Costs and expenses:
Consulting expense		163,942		125,611
Marketing		241,888		7,780
Rent		19,610		17,212
Payroll and payroll related expenses		1,037,042		769,940
General and administrative costs		788,294		392,297
Total costs and expenses		2,250,776		1,312,840
Operating income (loss)		(749,020)		6,670

Other income (expense):
Interest expense		(13,304)		(36,312)
Debt forgiveness		-		224,260
Amortization of intangible assets		(28,331)		(21,081)
Realized loss on sale of investment		-		(406,060)
Total other income (expense)		(41,635)		(239,193)
Net loss before taxes		(790,655)		(232,523)
Income tax expense		(299,000)		(297,000)
Net income (loss)	$	(491,655)	$	64,477

Basic earnings (loss) per share	$	(0.07)	$	0.02
Diluted earnings (loss) per share	$	(0.07)	$	0.02

Weighted average number of common shares outstanding:
Basic		7,471,207		3,168,547
Diluted		7,471,457		3,171,397

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Netcapital Funding Portal Revenues Increase by More Than 100%