Update on Business Operations

FLYING BRANDS LIMITED

("Flying Brands" or the "Company")

Update on Business Operations

Flying Brands (FBDU), the medical services and software company, is pleased to update shareholders on recent progress.

Prototype testing

The prototype testing and evaluation by the StoneChecker team has now been successfully completed.

In addition to the original goal of providing the composite score of likely lithotripsy success, the following observations were made:

- The semi-automatic calculation of important clinical information has been well received by clinicians.

- Urologists and Radiologists appreciated the easy click process, the display of important clinical information such as stone to skin-surface distance and the map of stone density architecture on CT.

The original StoneChecker development plans required the collection of data in order to produce the composite score, but it is now evident that the display of this information in itself is a commercially attractive proposition. There is also a higher level of interest than expected in publishing post-marketing research on the clinical usefulness of the StoneChecker software.

Other future applications, including non-invasive stone composition assessment (e.g. uric acid vs non-uric acid) has been piloted at Peking Union Medical College Hospital, Beijing, China with promising results. This application has potential benefits in assisting in treatment selection and/or dietary recommendations. This new data will be incorporated in future releases of the commercial software.

CE marking

The StoneChecker team has worked assiduously with the North American software developer and regulatory consulting partners to reduce the previously announced delay to the CE marking program and now anticipates attaining CE marking before the end of 2017.

 **ENDS**

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