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Original-Research: Advanced Blockchain AG - from GBC AG
Classification of GBC AG to Advanced Blockchain AG
Balance sheet adjustment completed. ABAG 2.0 Awaits Operational Proof. Advanced Blockchain AG (ABAG) continued its far-reaching balance sheet reset in fiscal year 2025. While the parent company’s revenue rose to €0.31 million from €0.23 million in the prior year, the operating cost base remained high. EBITDA deteriorated to -€1.67 million from -€1.29 million in the prior year, while EBIT fell to -€3.36 million from -€1.46 million in the prior year due to high impairment charges. On the bottom line, the net loss for the year increased to -€3.48 million, compared to -€1.78 million in fiscal year 2024. Earnings were therefore once again significantly affected by legally required review and remediation work, legal and consulting expenses, and extensive necessary balance-sheet adjustments. The most significant impact occurred at the subsidiary Incredulous Labs Ltd., where a large portion of the investment and token portfolio is concentrated. In 2025, Incredulous Labs generated revenue of $0.05 million, down from $0.23 million in the prior year, and reported a net loss of $16.98 million, compared to an adjusted net profit of $0.95 million in the prior year. This was primarily due to extensive impairment charges on intangible assets and token rights, fair value losses on unlisted project investments, as well as write-offs and allowances for doubtful accounts. As a result, Incredulous Labs’ total assets fell significantly to USD 5.39 million from USD 21.64 million in the prior year, while equity declined to negative USD 7.48 million from positive USD 9.50 million. While this development significantly impacts the company’s balance sheet ratios in the short term, it also creates a much more conservative starting point for future valuation. On a positive note, significant progress was made in the fiscal year 2025 in addressing historical issues and improving governance and control structures. The auditor in Cyprus assessed the further development of the control systems not merely as isolated improvements, but as a comprehensive transformation. Thanks to the extensive asset protection measures continued throughout 2025 and beyond, the systematic review of historical transactions, and the comprehensive optimization of internal control and reconciliation processes, the issues that had led to the disclaimer of opinion on Incredulous Labs’ 2023 and 2024 financial statements were substantially resolved. As a result, Incredulous Labs was no longer issued a disclaimer of opinion for the 2025 fiscal year, but rather a qualified opinion. The remaining qualification primarily relates to an intra-group balance with Brain Networks Ltd. In our view, this reflects significant qualitative progress compared to previous years and strengthens the Group’s transparency and capital market viability. At the same time, the financial situation remains strained. As of December 31, 2025, Advanced Blockchain AG had cash and cash equivalents of only €0.11 million, while Incredulous Labs reported bank balances of only approximately $3,700. After the balance sheet date, the liquidity base was strengthened by a six-figure shareholder loan. However, further financing measures and the successful monetization of portfolio assets remain key prerequisites for implementing the new strategy and achieving the Group’s sustainable stabilization. Strategically, the company is now poised to transition from balance sheet restructuring to operational value creation. Under the “ABAG 2.0” vision, the existing investment model is to be expanded to include the areas of Investments, Treasury, Innovation, Consulting, and Analytics. Additional revenue potential is expected to be tapped primarily through ABX Analytics, tokenization projects, the use of the trading license in Dubai/UAE, and selective activities in AI- and robotics-related areas. In the short term, we do not yet expect any material earnings contributions from these initiatives, but we see meaningful strategic optionality. At the same time, the portfolio strategy is likely to focus more strongly on a few core positions with higher value appreciation potential, including, in particular, PEAQ, Panoptic, zCloak/Starks Network, and other selected DeFi, infrastructure, and DePIN positions. We continue to consider an adjusted NAV approach appropriate for valuation. Traditional multiples are currently of limited use due to the lack of a normalized earnings base. Based on the fair values recognized on the balance sheet, the remaining token and project rights, a risk-adjusted valuation for PEAQ, and a limited option value for ABAG 2.0, we calculate a risk-adjusted gross asset value of €14.70 million. After deducting external obligations, financing discounts, and capitalized holding costs, the adjusted NAV amounts to €8.12 million. With 4.06 million outstanding shares, this corresponds to a fair value of €2.00 per share. The stock remains a speculative investment with heightened dependence on token markets, portfolio monetization, financing opportunities, and the successful implementation of the new operational strategy. At the same time, following the balance sheet reset, improved control structures, and a stronger focus on selected value drivers, we see an improved foundation for a potential revaluation. Based on our optimistic adjusted NAV model, we therefore assign a BUY rating with a price target of €2.00. You can download the research here: 20260721_Anno_ABAG_EN Contact for questions: GBC AG Halderstrasse 27 86150 Augsburg 0821 / 241133 0 research@gbc-ag.de ++++++++++++++++ Disclosure of potential conflicts of interest pursuant to Section 85 of the German Securities Trading Act (WpHG) and Article 20 of the Market Abuse Regulation (MAR) The following potential conflict of interest exists in relation to the company analysed above: (5a,11); A list of potential conflicts of interest can be found at: https://www.gbc-ag.de/de/Offenlegung +++++++++++++++ Completed: July 21, 2026 (2:00 p.m.) First release: July 22, 2026 (11:00 a.m.)
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2369360 22.07.2026 CET/CEST