FY 2025 results: profit on paper, operating loss underneath
The Smarter Web Company has posted audited results for the year to 31 October 2025. Headline profit before tax came in at £2,835,848. Strip out the loan write-off and fair value movements totalling £4,308,224, and you get an underlying loss before tax of £1,472,376. In plain English: accounting gains turned a sizeable operating loss into a statutory profit.
Revenue from the operating business was £70,029, with an operating loss of £1,777,892 driven by the cost of scaling, listing and building governance. Management flags that £1.35 million of listing-related costs are one-off in nature, with £660,000 recognised in FY 2025 and the balance to follow in FY 2026.
| Key metrics | FY 2025 |
|---|---|
| Revenue | £70,029 |
| Operating loss | £1,777,892 |
| Profit before tax | £2,835,848 |
| Adj. loss before tax (excl. one-offs & fair value) | £1,472,376 |
| Basic EPS | 1.24p |
| Diluted EPS | (1.52)p |
| Cash | £1,503,118 |
| Total assets | £223.0 million |
| Total equity | £210.4 million |
| Shares in issue at year end | 300,237,093 |
Note the EPS quirk: basic EPS shows a profit, but after adjusting for potential dilution from the convertible note, diluted EPS flips to a 1.52p loss. That is the accounting effect of fair value movements and potential conversion features flowing through the earnings calculation.
Bitcoin treasury dominates the balance sheet
The story here is the treasury. At year end, the Company held 2,660 Bitcoin, carried at £220,003,460, and by 19 February 2026 that had ticked up to 2,689 Bitcoin. The Board says, insofar as it is aware, the Company remains the largest UK-listed public holder of Bitcoin. Bitcoin is classified as an intangible asset under IFRS and measured at fair value via a revaluation model, which will make reported earnings inherently volatile.
Management is open about the strategy: focus on long-term Bitcoin per share growth, disciplined capital allocation, and a balance sheet without fiat debt. That last point matters. There is no traditional bank debt. The principal liability is a Bitcoin-backed, interest-free, one-year convertible loan note carried at fair value.
Fundraising, convertibles and warrants – what investors should know
The Company raised £225.2 million during the year, comprising £209.4 million in equity and £15.8 million via the Smarter Convert CLN. That note was issued on 5 August 2025, is backed by 177.8909127 Bitcoin held in a segregated wallet, and can be settled at the holder’s option by:
- Conversion into shares at £2.0475 per share, or
- Transfer of the underlying Bitcoin (less costs), or
- Cash equivalent in GBP, USD or EUR.
The fair value of this note decreased to £15,722,418 at year end, creating a non-cash gain in the income statement. It is interest-free, short-dated and potentially dilutive. There are also 105,746,975 warrants outstanding, mostly exercisable at 2.5p between April 2026 and April 2028, plus a later tranche exercisable at £1.50. In short: optionality for the Company and holders, and dilution risk for existing shareholders if instruments are exercised or the note converts.
Operating business: small base, disciplined on costs, M&A-led
The core business provides web design, hosting and online marketing services on a fee plus recurring charge model. Underlying operations are described as stable. Revenues are modest at this stage, so the route to meaningful operating profits likely runs through acquisitions.
Acquisitions are a core pillar of the 10-Year Plan. The Board says it has reviewed several opportunities and sees an attractive pipeline, with a focus on profitable, cash-generative, recurring-revenue businesses that enhance capabilities and help deliver a sustainable return to profitability. Capital allocation is flagged as disciplined, with transactions expected to support growth through cycles and reinforce the objective of increasing Bitcoin per share.
Main Market listing and post-period moves
In February 2026, The Smarter Web Company moved from Aquis to the Main Market of the London Stock Exchange. That is a meaningful step up in profile and should, in time, help liquidity and broaden access to institutions.
Post year end, a new subscription agreement with Shard Merchant Capital Ltd was signed on 23 December 2025, providing for the issue of 50,000,000 new shares at par value and covering 13,240,500 previously issued but unsold shares, taking the available allocation to 63,240,500. Admission of the new shares took place on 2 January 2026. The AGM is set for 19 March 2026 at 11.00 a.m. in Bristol.
Why this result matters: positives and pressure points
What I like
- Balance sheet strength – £210.4 million of equity and no fiat debt. The Bitcoin treasury is sizeable and liquid.
- Clear strategy – dual track of operating growth and Bitcoin treasury management with an explicit long-term plan.
- Main Market step-up – improves visibility and should help the shareholder register over time.
- Cost discipline – acknowledgement of one-off listing costs and focus on scalable, efficient operations.
What gives me pause
- Operating scale – £70,029 of revenue and a £1.78 million operating loss underline how early the operating business still is.
- Earnings volatility – fair value accounting for both Bitcoin and the convertible creates large non-cash swings.
- Dilution risk – extensive fundraisings and 105.7 million warrants, plus the convertible’s ability to settle in shares.
- Bitcoin exposure – the Company is materially exposed to Bitcoin price moves, which the FCA regards as high risk.
Risk lens: what to watch in FY 2026
- Convertible resolution – the Smarter Convert CLN matures within a year of issue. Track any conversions, redemptions or Bitcoin transfers.
- Acquisition execution – quality, price and integration discipline on any deals will determine the operating P&L trajectory.
- Cash management – cash was £1.5 million at year end. Working capital coverage and treasury mechanics matter given crypto volatility.
- Share issuance – activity under the Shard subscription and any additional equity raises or warrant exercises.
- Bitcoin accounting – revaluation movements will continue to drive reported earnings. Focus on cash and underlying operating KPIs.
My take: high-conviction treasury play with an M&A engine to build
These results frame The Smarter Web Company primarily as a Bitcoin-treasury-led balance sheet play, with an operating business that management intends to grow through disciplined acquisitions. The statutory profit is flattered by fair value and one-off items, while the operating loss and small revenue base show the work still to do.
If you buy into Bitcoin’s long-term role and like the optionality of a Main Market vehicle pursuing recurring-revenue acquisitions, this is an interesting, if volatile, story. If you prefer clean, cash-generative operations without fair value noise or dilution risk, you will want to see tangible progress on acquisitions and a pathway to operating profitability first.
Bottom line: a bold balance sheet, bigger stage, and a clear plan. Execution in FY 2026 on M&A, capital discipline and managing the convertible will tell us whether that plan translates into durable per-share value.
