IBEX Technologies : Management Discussion and Analysis, Fiscal year 2022

IBEX TECHNOLOGIES INC.

MANAGEMENT DISCUSSION AND ANALYSIS

FISCAL 2022

YEAR ENDED JULY 31, 2022

As at November 9, 2022

MANAGEMENT DISCUSSION AND ANALYSIS

FOR THE YEAR ENDED JULY 31, 2022

November 9, 2022

TABLE OF CONTENTS

1. PREAMBLE
2. FORWARD-LOOKINGSTATEMENTS
3. INTRODUCTION TO IBEX

1. Enzymes
2. Arthritis Assays

1. RESULTS OF OPERATIONS:
   Q4 FISCAL 2022

1. Summary of Quarterly Results
2. Foreign Exchange
3. Revenues for the Quarter
4. Total Expenses for the Quarter

1. Cost of Sales
2. Research and Development Expenses
3. Selling, General and Administrative Expenses
4. Income taxes expense (recovery)
5. RESULTS OF OPERATIONS FOR THE YEAR ENDED JULY 31, 2022

1. Summary of Year Results
2. Foreign Exchange
3. Revenues for the Year
4. Total Expenses for the Year

1. Cost of Sales
2. Research and Development Expenses
3. Selling, General and Administrative Expenses
4. Income taxes expense (recovery)

1. LIQUIDITY AND CAPITAL RESOURCES

1. Overview
2. Contractual Obligations

1. LOOKING FORWARD

1. RISKS AND UNCERTAINTIES
2. 1. Dependence on Key Customers
   2. Market Demand
   3. Regulatory Approval
   4. Competition
   5. Financial Resources
   6. Reliance on Key Personnel
   7. Contingencies
   8. Foreign Exchange Risks
   9. Interest Rate Risk
   10. Credit Risk
   11. Fair Value of Financial Instruments
   12. Information technology systems
3. RELATED PARTY TRANSACTIONS
4. CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS
5. 1. Valuation of Unrecognized Tax Attributes
   2. Impairment of Non-Financial Assets
6. ACCOUNTING STANDARDS AND AMENDMENTS
7. NCIB
8. OUTSTANDING SHARE DATA
9. 1. Authorized
   2. Issued and Outstanding

13.2.1.Common Shares

13.2.2.Stock Options

14. COVID-19 IMPACT

1

MANAGEMENT DISCUSSION AND ANALYSIS

November 9, 2022

• PREAMBLE

The following Management Discussion and Analysis ("MD&A") and the audited consolidated financial statements of IBEX Technologies Inc. (the "Company") were approved by the Audit Committee and the Board of Directors on November 9, 2022. This MD&A provides a review of the developments and results of operations of the Company during the fourth quarter and the fiscal year ended July 31, 2022 compared with the fourth quarter and the fiscal year ended July 31, 2021.

This MD&A should be read in conjunction with the Company's audited consolidated financial statements and notes thereto for the years ended July 31, 2022 and 2021.

The Company's audited consolidated financial statements are prepared in accordance with International Financial Reporting Standards ("IFRS"). Additional information relating to the Company, including the Company's Proxy Circular, can be found on SEDAR at www.sedar.com.

Where "IBEX" or "the Company" is used, it refers to IBEX Technologies Inc. and its wholly owned subsidiaries, unless otherwise indicated. All amounts are in Canadian dollars, unless otherwise indicated.

• FORWARD-LOOKINGSTATEMENTS

This document contains forward-looking statements that reflect the Company's current expectations regarding future events. Any such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in these forward-looking statements. For more information on the Company's risks and uncertainties relating to these forward-looking statements, please refer to the risks and uncertainties section of the MD&A.

• INTRODUCTION TO IBEX

3.1 Enzymes

The Company, through its wholly owned subsidiary, IBEX Pharmaceuticals Inc., manufactures and markets enzymes for biomedical use.

The Company's products are sold directly by the Company to manufacturers of medical devices, quality control labs, low molecular weight heparin manufacturers and academic research institutions.

Heparinase I is the most important of the IBEX enzymes. Its potential lies in its ability to cleave heparin and low molecular weight heparins and thereby neutralize the effects of heparin and heparinoids, which are drugs commonly used in hospitals and which interfere with hemostasis tests. Heparinase I recognizes and cleaves a pentasaccharide sequence which occurs in both unfractionated heparin and the low molecular weight heparins, thereby neutralizing their anticoagulant activity and thus facilitating the accurate measurement of hemostasis.

IBEX heparinase I is made via a proprietary process and is the only heparinase I approved for use in clinical diagnostics in North America and Europe.

The Company also makes enzymes which are used in producing diagnostic tests for acetaminophen poisoning and enzymes which are used in tests for homocystinuria.

In addition to making and selling enzymes, IBEX also provides lyophilization services for the making of disposable medical diagnostic device components used in the hemostasis point-of-care market

2

3.2 Arthritis Assays

IBEX develops, manufactures and sells arthritis assay kits which enable the study of both the synthesis and degradation of cartilage components. These assays are powerful tools in the study of osteo and rheumatoid arthritis. These assays are a result of both internal research and development, and the in-licensing of technology from academic research institutions.

IBEX arthritis diagnostic kits and services are marketed and sold for research use only ("RUO") to pharmaceutical companies, clinical research organizations and academic institutions. These diagnostic kits are marketed through distributors in Europe and Japan, and directly by IBEX in North America and the rest of the world. The kits are produced in IBEX facilities.

• RESULTS OF OPERATIONS: Q4 FISCAL 2022

4.1 Summary of Quarterly Results

The following table is a summary of selected quarterly consolidated financial information of the Company for each of the eight most recently completed quarters.

		(in thousands of				Q4					Q3				Q2					Q1						Full Year
		dollars, excluding per
					2022				2021				2022				2021				2022				2021				2022					2021				2022				2021
		share amounts)
					$				$				$				$				$				$				$					$				$				$
		- Revenues	2,070				1,361		2,209		1,468		1,832				1,313		1,781				1,165		7,892		5,306
		- Net earnings &
		comprehensive	35			29		570		334		405				249		665				150		1,674		762
		income
		- Earnings per	-			-		0.02		0.01		0.02				0.01		0.03				0.01		0.07		0.03
		common share
		- EBITDA		815				343			687			432			496				348			763				246			2,761			1,369

Net Earnings for the Quarter

The Company recorded net earnings of $34,764 during the fourth quarter ended July 31, 2022 compared to net earnings of $29,424 for the same period year ago. Revenues of $709,065 (see section 4.3), were offset by an increase in expenses of $199,221 and an increase in the tax provision of $504,504 (see section 4.4).

EBITDA for the quarter was $815,219 versus $343,000 last year, an increase of $472,219.

It should be noted that Earnings Before Interest, Tax, Depreciation & Amortization ("EBITDA") is not a performance measure defined by IFRS, but we, as well as investors and analysts, consider that this performance measure facilitates the evaluation of our ongoing operations and our ability to generate cash flows to fund our cash requirements, including our capital expenditures program. Note that our definition of this measure may differ from the ones used by other public corporations. The elements include in the Company's EBITDA are: Net earnings (loss), Depreciation of property, plant, equipment and intangible assets, Depreciation of right-of-use assets, Interest-Net, Income tax expense (recovery).

3

4.2 Foreign Exchange

The tables below show the fluctuation in the Canadian/US dollar exchange rates which can have a significant impact on the Company's results. Average rates are used to translate revenues and expenses for the period mentioned; closing rates are used to translate assets and liabilities of foreign operations, as well as monetary assets and liabilities at the end of the reporting period.

Consolidated foreign exchange (gain) / loss

							July 31,				July 31,
		Quarter ended				2022				2021
		Balance sheet revaluation
		●	US cash	($25,014)		($97,106)
		●	US Trade receivables	$4,454		($32,215)
		●	Other US accounts	$5,876		$21,571
		Total (gain) / loss on revaluation		($14,684)			($107,750)
		Canadian/US dollar
		Quarter ended				July 31,				July 31,
								2021
					2022
		Average rate	1.2869		1.2291
		Closing rate		1.2824			1.2462

4.3 Revenues for the Quarter

Note: While the Company reports in Canadian dollars, the US dollar is the Company's selling currency. As such, fluctuations in the Canadian/US dollar exchange rate can have a significant impact on the reported revenue figures.

Revenues for the quarter ended July 31, 2022 totaled $2,070,014, an increase of $709,065 (52%) compared to the same period year ago. The increase in revenues is mainly due an increase in volume of $470,250 (US$365,413) and product mix of $182,537 (US$141,843) due to a combination of COVID-driven increases in the use of heparinase I, and by customers increasing their inventories to protect against supply-chain interruptions.

		Revenues Variations - Quarter ended				July 31, 2022
					vs. July 31, 2021
		Volume/mix impact:
		● Increase due to volume USD	$365,413
		● Increase due to product mix USD	$141,843
		Total increase due to volume/mix USD	$507,256

4