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Cantex Mine Development Corp. — Management Reports 2025
Dec 24, 2025
44657_rns_2025-12-24_669c281a-5ec0-4bc6-9612-a187c329d92e.pdf
Management Reports
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CANTEX
CANTEX MINE DEVELOPMENT CORP.
FORM 51-102F1 MANAGEMENT DISCUSSION AND ANALYSIS THREE MONTH PERIOD ENDED OCTOBER 31, 2025
The following Management Discussion and Analysis ("MD&A"), prepared as of December 23, 2025, of the results of operations and financial position of Cantex Mine Development Corp. (the "Company") for the three month period ended October 31, 2025 should be read together with the unaudited condensed consolidated interim financial statements for the three month period ended October 31, 2025 and related notes attached thereto, which are prepared in accordance with International Financial Reporting Standards ("IFRS"). All amounts are stated in Canadian dollars unless otherwise indicated.
Additional information related to the Company is available on www.cantex.ca or on SEDAR+ at www.sedarplus.com.
Description of Business
The Company's principal business activity is the exploration and development of mineral properties for commercial mineral deposits and it is considered to be at the exploration stage. The Company has not yet determined whether any of its properties contain ore reserves that are economically recoverable. The Company trades on the TSX Venture Exchange under the symbol CD.
The Company's primary project is in the Yukon where the Company has staked 1,075 claim blocks covering approximately 21,500 hectares. The Company also owns exclusive exploration licenses over a 1,583 square kilometer ("km²") area in the northwestern part of the Republic of Yemen. In Nevada, USA, the Company also has a 100% interest in 2 groups of gold exploration claims.
Cautionary Note Regarding Forward Looking Statements
Certain statements in this report are forward-looking statements, which reflect our management's expectations regarding our future growth, results of operations, performance and business prospects and opportunities including statements related to the development of existing and future property interests, availability of financing and projected costs and expenses. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future. Such statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements. No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits we will obtain from them. These forward-looking statements reflect management's current views and are based on certain assumptions and speak only as of the date of this report. These assumptions, which include management's current expectations, estimates and assumptions about current mineral property interests, the global economic environment, the market price and demand for gold and other minerals and our ability to manage our property interests and operating costs, may prove to be incorrect. A number of risks and uncertainties could cause our actual results to differ materially from those expressed or implied by the forward-looking statements, including: (1) a downturn in general economic conditions, (2) a decreased demand for or price of gold and other minerals, (3) delays in the start of projects with respect to our property interests, (4) inability to locate and acquire additional property interests, (5) the uncertainty of government regulation and politics in Yemen regarding mining and mineral exploration, (6) potential negative financial impact from regulatory investigations, claims, lawsuits and other legal proceedings and challenges, and (7) other factors beyond our control.
There is a significant risk that such forward-looking statements will not prove to be accurate. Investors are cautioned not to place undue reliance on these forward-looking statements. No forward-looking statement is a guarantee of future results. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Performance Summary
The following is a summary of significant events and transactions:
Private Placements
In October and November 2023, the Company received total proceeds of $3,823,485 from the issuance of 13,435,207 common shares, which were issued as a combination of units and flow through units ("FT Units"); 5,176,923 units were issued at $0.26/unit, comprising of one non-flow through share and one half of a non-flow through warrant, and 8,258,284 FT units were issued at $0.30/unit, comprising of one flow through share ("FT Share") and one half of a non-flow through warrant. A total of 6,717,607 warrants were issued as part of the private placement, with each whole warrant exercisable at $0.39/share, for a period of two years from issuance. The Company incurred commissions of $208,535 in conjunction with this deal; of this, $54,535 was settled with cash payment, and $154,000 was settled with the issuance of 592,308 units, which were comprised of one non-flow through common share and one half of a non-flow through warrant. As part of the commission agreements, the Company issued 772,678 finder's warrants; the finder's warrants have the same terms as those issued as part of the Units and FT Units. During the year ended July 31, 2025, a portion of these finders fees were rescinded by the vendor and 134,616 units valued at $35,000 (134,616 shares and 67,308 warrants) and 134,616 finders warrants valued at $8,200 were returned to the Company's treasury.
In December 2023, the Company announced a new financing to raise up to $3,000,000. Over the course of four tranches, the Company received total proceeds of $3,000,190 from the issuance of 10,216,120 common shares, which were issued as a combination of units and FT Units; 1,616,154 units were issued at $0.26/unit, comprising of one non-flow through share and one half of a non-flow through warrant, and 8,599,966 FT units were issued at $0.30/unit, comprising of one FT Share and one half of a non-flow through warrant. A total of 5,108,063 warrants were issued as part of this tranche of the private placement, with each whole warrant exercisable at $0.39/share, for a period of two years from issuance. The Company incurred commissions of $177,100 in conjunction with this tranche; of this, $65,100 was settled with cash payments, and $112,000 was settled with the issuance of 430,766 units, which were comprised of one non-flow through common share and one half of a non-flow through warrant. As part of the commission agreements, the Company issued 647,766 finder's warrants; the finder's warrants have the same terms as those issued as part of the Units and FT Units. During the year ended July 31, 2025, a portion of these finders fees were rescinded by the vendor and 53,846 units valued at $14,000 (53,846 shares and 26,923 warrants) and 26,923 finders warrants valued at $6,100 were returned to the Company's treasury.
In July 2024, the Company received proceeds of $1,450,000 from the issuance of 12,083,331 non-flow through shares. The Company incurred cash commissions of $24,500 and incurred other shares issuance costs of $13,185 regarding this financing.
In December 2024, the Company announced a private placement of FT Shares, which were issued at $0.15/FT share. The Company issued 4,000,000 FT shares and received proceeds of $600,000 in proceeds, which will be used for critical mineral exploration work on the North Rackla project. The Company incurred cash commissions of $36,000 and other share issuance costs of $4,996 in regard to this financing; 200,000 finder's warrants were also issued, which are exercisable at $0.15/share for a period of two years from issuance.
In July and August 2025, the Company received total proceeds of $5,282,392 from the issuance of 5,731,372 Units issuable at $0.14/Unit and 21,333,332 charity flow through units ("CFT Units"), issuable at $0.21/CFT Units and hard units ("Units"). The CFT Units are comprised of one flow through share and one non-flow through warrant; the Units are comprised of one non-flow through share and one non-flow through warrant. Each whole warrant issued in connection with either a CFT Unit or a Unit entitles the holder to acquire a non-flow through share at a price of $0.21 for a term of three years. The Company incurred finders fees of $36,652 and other filing costs of $79,011. The Company also settled $115,317 in finder's fee with the issuance of 823,696 Units and issued 1,067,996 non-transferrable finder's warrants (the finder's warrants have the same terms and conditions as the warrants included in CFT Units and Units).
The reader is referred to the MD&A for the years ended July 31, 2025 and July 31, 2024 for details of the private placements completed during those periods.
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Mineral Properties
Details of the activities on the properties are provided in the following commentary:
Yukon Metals Project
In early 2011, the Company identified a 30,000 km² area of the Yukon, Canada that management felt was underexplored. In August 2011, a field program was completed which consisted of the collection of 2,315 heavy mineral samples testing an area of 30,000 km² underlain by un-staked geology favorable for hosting gold and base metal mineralization.
Based upon the results of the regional heavy mineral sampling program, the Company staked eight claim blocks totaling 1,380 claims covering over 28,000 hectares in September of 2012. These include the North Rackla and Mt Good claim blocks. During the summer of 2013 an additional 1,275 hectares was staked, expanding the North Rackla claim block.
North Rackla Claims
During the 2013 summer program at North Rackla a zone of gossan which sub-outcrops for a distance of 600 metres with an apparent width of up to 20 metres was discovered. The gossan zone was open at both ends. Grab samples of sub-outcrop and down slope talus were assayed from along the 600 metre strike length and exhibited elevated metal contents of up to 2.52% copper, 43.60% lead, 7.11% zinc and 35.60 oz/t silver. This defined the "Discovery Sector" of the Massive Sulphide area.
During 2014 over 6,000 soil-talus samples were collected at North Rackla on infill lines to better define the previously detected anomalies.
In 2015 a summer program consisting of prospecting and infill soil-talus sampling was undertaken. Prospecting extended the Discovery Sector 1.7km towards the southwest to the new "Extension Sector". The soil-talus samples assisted in defining twelve anomalous zones within the North Rackla claim block
In October 2016, an eight hole winter drilling program was commenced on the Extension Sector in the Massive Sulphide area. All eight holes intersected mineralization; however, this mineralization was largely oxidized due to the shallow depth of drilling. Deeper intercepts did show the potential of the discovery, such as a 4.4 meter intercept in the 6th hole which contained 48.9g/t silver, 5.35% lead and 5.99% zinc from 43.7 metres down hole.
During 2018 a nine hole program was completed on the Extension Sector. This drilling tested deeper levels of the mineralization and intersected fresh sulphide mineralization. A selection of these results are presented in the following table.
| Hole | From (m) | To (m) | Estimated True Width (m) | Silver (ppm) | Copper (%) | Lead (%) | Zinc (%) | Manganese (%) |
|---|---|---|---|---|---|---|---|---|
| YKDD18-012 | 100.87 | 113.87 | 9.19 | 150.6 | 0.05 | 8.09 | 18.04 | 3.67 |
| YKDD18-013 | 121.45 | 133.82 | 7.10 | 158.0 | 0.09 | 6.04 | 23.12 | 1.58 |
| YKDD18-014 | 183.40 | 205.40 | 9.30 | 122.6 | 0.01 | 7.33 | 10.97 | 4.70 |
| YKDD18-015 | 124.28 | 133.28 | 5.21 | 67.2 | 0.05 | 5.48 | 10.48 | 4.17 |
| YKDD18-016 | 106.27 | 114.90 | 4.46 | 142.1 | 0.09 | 11.44 | 18.36 | 2.95 |
Based on the favourable results of 2018 the Company undertook an extensive drill program during 2019, with 139 holes totaling 38,174 metres drilled.
Drilling initially concentrated in the Extension Sector, near the previous drilling. These holes continued to intersect similar high grade mineralization, with selected intercepts in the table below.
| Pad | Dip | Hole | From (m) | To (m) | Length (m) | Silver (g/t) | Lead+Zinc (%) | Lead (%) | Zinc (%) | Copper (%) | Mn (%) |
|---|---|---|---|---|---|---|---|---|---|---|---|
| MZ5 | -88 | YKDD19-046 | 104.5 | 136.5 | 32.0 | 134.41 | 24.94 | 8.47 | 16.47 | 0.13 | 2.59 |
| MZ4 | -80 | YKDD19-067 | 188.3 | 197.8 | 9.5 | 62.9 | 12.75 | 6.22 | 6.53 | 0.01 | 1.67 |
| MZ4 | -89 | YKDD19-068 | 168.9 | 191.1 | 22.2 | 85.2 | 8.53 | 6.84 | 1.69 | 0.04 | 2.78 |
| MZ3 | -70 | YKDD19-050 | 157.3 | 160.3 | 3.0 | 99.5 | 14.34 | 9.81 | 4.53 | 0.08 | 2.68 |
Later in the season drilling continued chasing mineralization along strike to the newly discovered Central Sector. Selected intercepts from this drilling at the Central Sector are presented below.
| Pad | Dip | Hole | From (m) | To (m) | Length (m) | Silver (g/t) | Lead + Zinc (%) | Lead (%) | Zinc (%) | Copper (%) | Mn (%) |
|---|---|---|---|---|---|---|---|---|---|---|---|
| MZ34 | -62 | YKDD19-156 | 270.65 | 287.5 | 16.85 | 44.7 | 10.67 | 3.2 | 7.47 | 0.08 | 4.1 |
| MZ33 | -45 | YKDD19-144 | 228.85 | 233 | 4.15 | 10.14 | 13.12 | 0.68 | 12.44 | 0.04 | 4.5 |
| -62 | YKDD19-146 | 222.6 | 240.75 | 18.15 | 95.62 | 33.82 | 13.21 | 20.61 | 0.07 | 2.23 | |
| -70 | YKDD19-149 | 235.7 | 240.1 | 4.4 | 12.08 | 8.71 | 0.29 | 8.42 | 0.02 | 0.34 | |
| -80 | YKDD19-155 | 353.15 | 364.8 | 11.65 | 38.14 | 11.41 | 3.37 | 8.04 | 0.22 | 2.68 |
The main focus of the 2020 drill program was continued expansion of the strike length of the Main Zone.
Drilling from pad MZ34 yielded the deepest mineralization to date, where a -84 degree hole intersected 58.2 metres (23.67 metres true width) of 8.15% combined lead and zinc with 24 g/t silver. Within this there were several higher grade zones including a 4.62 metre (true width) zone which contained 19.24% lead-zinc with 67 g/t silver. This intercept is 700 metres below surface, showing the continuity of the mineralization to depth.
Drilling from MZ51 in the Discovery Sector extended the strike of the drill-confirmed Main Zone to over 2 kilometres, with 4.5 metres of massive to disseminated sulphides intersected between 68.0 and 78.2 metres depth.
Prospecting in 2020 discovered a train of massive sulphide boulders 500 metres southeast of the Main Zone. Initial sampling of six boulders averaged 281 g/t silver, 18.93% lead and 32.29% zinc. An initial drill hole was oriented at an azimuth of 225 degrees and inclination of -45 degrees and intersected strong silver-lead-zinc massive sulphides and vein mineralization between 68.95 and 80.30 metres which included 4.05 metres which assayed 130g/t silver, 7.25% lead and 32.14% zinc. This new discovery is called the GZ Zone. In addition, mineralization measuring 6.35 metres wide was cut while road building.
Drilling of the Main Zone and the newly discovered GZ Zone continued in 2021. Drilling at the Main Zone focused on extending the mineralization towards the northeast and also filling in between the Central Sector and Discovery Sector. Results from the first 14 holes were released on November 2, 2021. These results continue to demonstrate the continuity of the high-grade mineralization with highlights including hole YKDD21-186 intersecting 4.8m of 6.06% lead, 9.48% zinc and 43.37g/t silver and hole YKDD21-189 intersecting 13.7m of 4.38% lead, 6.41% zinc and 26.43g/t silver. By the end of the season drilling had extended the strike length of the Main Zone to 2,100 metres.
The first 2021 drill results for the GZ Zone were released on February 6, 2022 which included an intercept in hole YKDD21-209 of 3.7m of 47.5% zinc, 12.5% lead and 336g/t silver within a broad 16.05m interval of 19.2% zinc, 4.7% lead and 101g/t silver. Further down the hole a 9.1m of 12.8% zinc, 5.0% lead and 53g/t silver was intersected.
The 2022 drill program consisted of 59 holes totaling 13,187 metres. The program commenced with drilling at the GZ Zone. Holes YKDD22-224, YKDD22-226 and YKDD22-228 were all drilled from pad GZ2.5C and each of these holes intersected significant sulphide mineralization. Hole YKDD22-224 intersected 11 metres of 11.7% lead-zinc and 36 g/t silver. Hole YKDD22-226 intersected 5.0 metres of 39.0% lead-zinc and 116 g/t silver. Hole
YKDD22-228 intersected 9.0 metres of 18.0% lead-zinc and 59 g/t silver which included a 4.5 metre high grade zone containing 29.0% lead-zinc and 93 g/t silver.
Subsequently the drills moved to the Main Zone to test the strike extent of mineralization to the northeast of the Discovery Sector. Drilling in 2022 successfully extended the Discovery Sector 250 metres, bringing the drill defined strike length of the Main Zone to 2,350 metres. Highlights of this drilling include hole YKDD22-244 intersecting 9 metres of 24.71 g/t silver and 9.69% lead-zinc from pad MZ52A, hole YKDD22-245 intersecting 7 metres of 37.53 g/t silver and 12.13% lead-zinc from pad MZ52 and hole YKDD22-262 intersecting 12.5 metres of 24 g/t silver and 7.1% lead-zinc.
As first reported on February 9, 2023 analyses of sphalerite (zinc sulphide) from the Main Zone mineralization show very high germanium values. 595 analyses completed on samples from 97 intersections along the entire Main Zone strike length averaged 654 g/t germanium. Seventy-seven analyses from the nearby GZ Zone average 521 g/t germanium.
On March 14, 2024 the Company reported that it had identified techniques which could accurately measure the germanium content of the entire core sample. These bulk analyses will allow the germanium content of the core to be measured in a reliable, cost effective and timely manner.
Cantex's Massive Sulphide project has very high germanium values when compared to other global sources. Germanium is one of the elements identified as a Critical Element in both Canada and the United States and is a high value metal, currently selling for US$1.93 per gram (December 12, 2025; Trading Economics; https://tradingeconomics.com/commodity/germanium).
On October 1, 2024 and February 12, 2025 bulk germanium results were reported from the 2024 drilling at the Main Zone. In whole core, bulk analyses returned up to 180 g/t germanium. These are very high germanium values when compared to other global sources. As a Critical Element in both Canada and the United States and since China, who supplies the vast majority of global germanium, banned exports to the US in late 2024 the Massive Sulphide project has the potential to provide a much needed western supply.
On June 24, 2024, there was a failure of Victoria Gold's heap leach facility at the Eagle Gold Mine, over 100 km away from Cantex's property. In order to focus on this unfortunate incident, the First Nation of Na-Cho Nyak Dun requested all exploration work to temporarily cease in their broad traditional territory. Cantex supported this effort and suspended work, recommencing August 19, 2024.
Drilling at the Main Zone in 2024 extended the confirmed mineralization 300 metres to a strike length of 2.65 kilometres. The mineralization remains open along strike and to depth.
On November 27, 2024 and January 20, 2025 the Company released results from the 2024 drill program focused on the Discovery Sector of the Main Zone. Highlights from these holes include a 2.4 metre interval of 25.82% combined lead-zinc within a broader interval of 13.63 metres of 7.25% combined lead-zinc in hole YKDD24-302B. Hole YKDD24-303 intersected a 2.1 metre interval of 27.63% lead-zinc within a broader 6.35 metre intercept of 13.91% combined lead-zinc. An 18.85 metre interval of mineralization was intersected in hole YKDD24-306 which contains 4.03% combined lead-zinc. A 9 metre interval of 34.08% combined lead-zinc and 96 g/t silver within a broader interval of 15 metres of 22.87% combined lead-zinc and 62 g/t silver was intersected in hole YKDD24-315. Hole YKDD24-312 intersected a 2 metre interval of 23.27% lead-zinc and 48 g/t silver within a lengthy 25.04 metre intercept of 4.62% combined lead-zinc and 18 g/t silver. These holes were drilled from the pad furthest to the northeast on the Main Zone, demonstrating the continued potential along strike.
Drilling in 2025 focused on testing regional anomalies within the claim block, with drilling late in the season testing further strike extension of the Discovery Sector. Results for the 2025 drilling are awaited.
Mount Good Claims
Subsequent to being staked in 2012 anomalous watersheds, as defined by the heavy mineral sampling program, were methodically soil-talus sampled. The results of the soil-talus sampling defined eight areas weakly to strongly anomalous in gold and one or more of the key Carlin pathfinder elements.
Over 1,300 soil-talus samples were collected during 2014 to better define the anomalies defined by the 2013 sampling.
In 2015 additional field work expanded the number of anomalous areas to ten.
Yemen
In December 2011, the Company entered into an agreement with Piedmont Lithium Limited ("Piedmont, formerly known as WCP Resources Ltd.) wherein Piedmont could earn an interest in the Al Hariqah gold project by funding advanced exploration and mine development to commercial production. The staged earn-in agreement ("Agreement") allowed Piedmont to earn up to a 70% interest in the project after funding a minimum of US$30,000,000 over a seven year period. In February 2012, Piedmont completed its due diligence process with respect to the Al Hariqah gold project and formally notified the Company that it would be proceeding with its two year option period in accordance with the terms of the option agreement.
In February 2014, Piedmont exercised an option to commence the earn-in to the Project after which they may earn an initial 40% interest in the project by expending US$5,000,000 within two years. As of May 2014, Piedmont issued notice that it felt it had reached its 40% interest; the Company does not agree with this statement. In October, 2014, Piedmont gave additional notice that they would no longer be funding the project. Allocation of ownership of the project has not yet been finalized. In May 2021, the Company received notice from Piedmont that it had assigned its interest in Al Hariqah to Lantern Resources Pty Ltd ("Lantern"), an affiliate and subsidiary of Piedmont. In October 2022, the Company received notice that Lantern was selling its interest in Al Hariqah to a third party; negotiations to determine and settle the percentages of ownership for the project have not been completed to date.
In September 2014, the Company, in conjunction with Piedmont, decided to declare a state of force majeure in regards to the Al Hariqah project. Due to the current political climate, notice has been given to the Chairman of the Geological and Mineral Resource Board that the Company no longer felt that the project area was secure. Operations at the Al Hariqah site have since ceased.
Al Hariqah Gold Deposit
The Al Hariqah gold deposit is located some 130 km northwest of Sana'a. It was discovered during follow up of anomalous gold values found in heavy mineral concentrates. Mapping and soil geochemistry have shown that gold mineralization occurs for a distance of nearly 4 km in two close, parallel, north northwest trending zones. These zones are up to 50 meters wide.
In January 2012, the exploration license containing the Al Hariqah project was renewed under the new Yemeni mining code. The new license is valid for an initial four year period and can be renewed for two further four year periods. In addition, the license has been expanded from its original 71 km² to 956 km². The new area covers a trend of gold anomalies discovered by Cantex's regional exploration program which could reflect additional mineralization similar to that found at Al Hariqah.
A 28 hole reverse circulation drill program, totalling 4,053 meters, was completed on the northern 1,100 meters length of the deposit in 1999 and 2000. These holes show that the mineralization extends to at least 150 meters depth with several deep holes bottoming in mineralization. The drilling suggests potential for a gold resource within the drilled area of between 13 and 52 million tonnes of a grade between 1.0 and 1.8 g/t. This target is for the northern 1,000 metres of the 3,700 metre long Al Hariqah deposit where the majority of the drilling to date has been undertaken. For the purposes of the exploration target, the mineralized width ranges from 100 to 400 meters and the mineralized thickness for the target ranges from 50 to 100 metres. The specific gravity of the host rock (Proterozoic quartz mica schist) is assumed to average 2.6 t/m³. However, the deposit is open along strike, across strike and at depth so there is potential to increase the tonnage available. The potential quantity and grade is conceptual in nature, there has been insufficient exploration to define a mineral resource and that it is uncertain if further exploration will result in the target being delineated as a mineral resource.
To better define the mineralization discovered in the previous round of drilling, a program of 45 holes using the Company's specialized core / percussion drill was conducted in late 2005 and 2006. These holes were located to test the extension of the mineralization defined by the previous drill program as well as to test the continuity of mineralization between holes. Results for these holes, as determined by fire assay at ALS Chemex, an ISO 9001:2000 accredited laboratory in Vancouver, were consistent with those of the previous drill program. The Company is most encouraged with the consistent results as they demonstrate the continuity of gold values within the Al Hariqah deposit. The gold grades recovered are typical of those found in open pit mines.
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A third round of drilling was underway. Prior to the declaration of force majeure, two core drills had been testing the southern extension of the deposit. Most of the prior drilling to this has focused on the northern 1,000 meters of the deposit which has been traced by soil sampling, channel sampling, geological mapping and limited drilling an additional three kilometers to the south. Much of the current drilling is focused on the southern 3,000 meters of the deposit.
Since Piedmont optioned the project from Cantex in December 2011, 44 holes for 6,378 meters have been drilled. Recent drilling has focused on testing the southern extension of the previously drilled mineralization to the south. These holes continue to intersect significant mineralization such as hole RDH063A which intersected 3.85 meters of 9.79 g/t Au from 70.76 meters and also 7.25 meters of 3.03 g/t Au from 80.55 meters. Hole RDH095A intersected multiple zones of mineralization including 15m of 3.67 g/t Au from 65m, 9m of 2.46 g/t Au from 87m, 20m of 1.48 g/t Au from 112m and 6m of 4.22 g/t Au from 143m. Multiple zones of mineralization were also intersected in hole RDH078A (14m of 3.15 g/t Au from 53m, 23m of 1.19 g/t Au from 95m and 6m of 7.38 g/t Au from 134m).
Significantly a series of channel samples approximately 400m north of the drilling conducted to date contained significant gold results. This demonstrates the potential for further strike extension of the deposit.
Al Masna Nickel, Copper, Cobalt Project
The Al Masna’a nickel, copper, cobalt project is located in the Saadah region some 205 km north-northwest of the capital city, Sana’a, and 25 km south of the border with Saudi Arabia.
Anomalous nickel and copper values have been found in heavy mineral concentrates in a number of samples collected in the region while variably anomalous results for cobalt and platinum occur in follow up drainage, soil and rock samples. Most of the anomalous values occur in an area underlain by layered gabbroic rocks. Soil surveying around a mineralized drill hole at Al Masna’a identified several anomalous zones of copper, nickel, cobalt, platinum, palladium and rhodium.
The evidence to date strongly suggests that the high nickel values discovered in the Al Masna drill hole are not an isolated occurrence and that there is good probability of discovering extensions to this mineralized zone, as well as new zones of nickel mineralization. The results of the sampling to date identify one or more zones of mineralization with a strike length of at least 4.5 km. The zone is open to the north.
Drilling is planned to test the IP, TEM and nickel soil geochemical anomalous zones in the Al Masna’a area with the objective of determining the grade and distribution of nickel and copper in the iron sulphide horizons. At present the Company cannot be certain of the safety of its workers at the Al Masna’a project. This is due to infrequent disputes in the area. As such the area is currently under force majeure. When the situation stabilizes the Company intends to resume work on the project.
Nevada Gold Project
Cantex now has a 100% interest in two mineral properties in Nevada.
Initially, sampling surveys were conducted over known gold mines in Nevada to assess their geochemical signatures. A distinctive suite of pathfinder elements was found to accompany many of the mines. Specifically, anomalous gold, bismuth, antimony, mercury and/or arsenic were found to be associated with significant gold mineralization. On that basis, a regional geochemical survey conducted over known gold mine trends was used to acquire the claims over the anomalous areas.
Once the lands were staked, the anomalies were followed up with geological mapping, soil sampling, rock sampling, trenching and geophysics. The geophysical surveys used Controlled Source Audio-frequency Magnetotelluric (CSAMT) techniques: a deep-looking geophysical technique that measures lateral and vertical resistivity contrasts which are important for evaluating the presence of geologic units which are favourable to host large tonnage gold deposits similar to those found elsewhere in Nevada.
In late 2010, an 11 hole, 2,449 meter reverse circulation drilling program was undertaken on the Leonard Creek property. Drilling on some holes intersected unusually deep overburden which was up to 320 meters thick. It is possible that the CSAMT geophysical anomalies may have been a result of the overburden rather than the underlying bedrock. As a consequence no significant gold mineralization was intersected. Therefore, in August 2012, the Company elected not to renew the 127 claims that comprised Leonard Creek property.
As announced on December 16, 2020 Cantex commenced a drill program on its Nevada properties. Drilling of 14 reverse circulation holes at the Bruner property resulted in the discovery of a Nevada-style gold-arsenic-antimony system. The most significant intercept was 39.62m of 0.35g/t gold from surface in hole 733DH21013.
Drilling at the Weepah South property determined that the source of the conductive geophysical anomaly was graphite interbedded in the Paleozoic carbonate rocks. No further work is planned at Weepah South.
Analytical results are pending for the five drill holes completed at the Baxter Springs property. Preparatory work has been completed at the Carico Lake property and three holes totaling 1,100 metres are planned.
The technical information and results reported in this section have been reviewed by Cantex President & CEO, Chad Ulansky P.Geol. Mr. Ulansky is a Qualified Person under National Instrument 43-101 and is responsible for the technical content herein.
Overall Performance
As at October 31, 2025, the Company has incurred cumulative losses of $99,166,304 (July 31, 2025 - $96,865,117) and had positive working capital of $1,837,756 (July 31, 2025 - negative working capital of $151,546). Cash flow from operations during the three months ended October 31, 2025 was negative $2,449,603 (October 31, 2024 - negative $2,655,259).
The key performance driver for the Company is the acquisition and development of prospective mineral properties. By acquiring and exploring projects of superior technical merit, the Company increases its chance of finding and developing an economic deposit.
At present, none of the Company's projects have reached the producing stage, therefore the Company is not anticipating profit or positive cash flow from operations. Until such time as the Company is able to realize profits from the production and sale of commodities from its mineral interests, Company will report an annual loss and will rely on its ability to obtain equity or debt financing to fund ongoing operations.
Selected Annual Information
The following table provides a brief summary of the Company's financial data for the three most recent fiscal years. For more detailed information, refer to the Financial Statements.
| Year Ended July 31, 2025 | Year Ended July 31, 2024 | Year Ended July 31, 2023 | |
|---|---|---|---|
| Total revenues | $ - | $ - | $ - |
| Net loss | 3,224,770 | 5,198,672 | 5,275,989 |
| Basic and diluted loss per share | 0.02 | 0.05 | 0.06 |
| Total assets | 954,086 | 4,486,539 | 1,470,482 |
| Total liabilities | 1,139,371 | 2,005,656 | 1,420,578 |
The Company has not paid any dividends on its common shares. The Company has no present intention of paying dividends on its common shares, as it anticipates that all available funds will be invested to finance the growth of its business.
See "Results of Operations" and the "Summary of Quarterly Results" for a discussion of the variations above.
Results of Operations
For the three month period ended October 31, 2025
For the three month period ended October 31, 2025, the Company incurred a loss of $2,301,187 (2024 - $2,031,819). The increased loss from the previous year is due to the size and timing of the drilling programs in each period, as well as the recovery of flow through premiums.
Some of the significant expenses for the three month period ended October 31, 2025 are as follows:
Exploration expenses totaled $2,523,157 (2024 - $1,931,537) of which $2,449,128 (2024 - $1,858,104) were incurred in the Yukon, $57,872 (2024 - $57,730) were incurred in Yemen, and $16,157 (2024 - $15,703) in Nevada. The Yukon program ran slightly longer in the current period than in the prior period, resulting in overall higher exploration expenditures. Yemen and Nevada costs have remained fairly consistent, as similar activity was done on both projects. Refer to the Schedule of Exploration Expenses in Note 4 in the condensed consolidated interim financial statements for additional detail.
Office and administrative costs of $95,167 (2024 - $72,459) have increased from the prior period; in the current period, the Company put on some investor information session in Germany, which increased overall Office and administrative costs. In addition to this, the Company entered into two 6 month advisory agreements in August 2025. Professional fees of $2,147 (2024 - $294) increased from the prior period due to slightly higher legal fees relating to general matters. Transfer agent and filing fees of $10,588 (2024 - $10,862) have remained consistent with the prior period as no additional work was needed in either period. The Company issued stock-based compensation to board, management, and key personnel as of April 2024, some of which has vested during the current period (2025 - $14,450; 2024 - $14,450); no options were issued in the previous or current period.
Net cash used in operating activities during the three month period ended October 31, 2025 was $2,449,603 compared to $2,655,259, during the three month period ended October 31, 2024. Please refer to the condensed consolidated interim statements of cash flows in the financial statements for a breakdown of the operating activities.
Net cash used by investing activities during the three month periods ended October 31, 2025 was $nil (2024 - $nil).
Net cash provided by financing activities during the three month period ended October 31, 2025 was $5,007,328 (2024 - cash used of $115,365). In the prior period, the Company had some residual share issuance costs relating to a financing completed in July 2024. In the current period, the Company raised $5,282,392 from the issuance of flow through and non-flow through funds ($85,000 of this had been collected in July 2025), which were offset by finders fees and other share issuance costs totaling $75,689. Both periods also incurred lease liability payment for the right-of-use asset.
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Summary of Quarterly Results
| (in accordance with IFRS) | Three month periods ended | |||
|---|---|---|---|---|
| October 31, 2025 | July 31, 2025 | April 30, 2025 | January 31, 2025 | |
| $ | $ | $ | $ | |
| Total assets | 3,599,276 | 954,086 | 1,162,651 | 1,634,163 |
| Working capital surplus (deficit) | 1,837,756 | (151,546) | 172,772 | 442,316 |
| Shareholders' equity (deficit) | 1,730,219 | (185,285) | 100,212 | 448,324 |
| Revenues | - | - | - | - |
| Net loss | 2,301,187 | 362,735 | 362,562 | 467,654 |
| Loss per share | 0.01 | 0.01 | 0.01 | 0.01 |
| (in accordance with IFRS) | Three month periods ended | |||
| --- | --- | --- | --- | --- |
| October 31, 2024 | July 31, 2024 | April 30, 2024 | January 31, 2024 | |
| $ | $ | $ | $ | |
| Total assets | 1,600,699 | 4,486,539 | 4,339,817 | 4,889,534 |
| Working capital (deficit) surplus | 383,256 | 2,326,381 | 3,402,862 | 3,920,069 |
| Shareholders' (deficit) equity | 462,524 | 2,480,883 | 3,421,628 | 4,007,028 |
| Revenues | - | - | - | - |
| Net loss | 2,031,819 | 2,368,499 | 582,227 | 980,104 |
| Loss per share | 0.02 | 0.02 | 0.01 | 0.01 |
Total assets has fluctuated depending on the timing of share proceeds being received from private placements and then spent. Flow through funds raised by private placements were spent mainly on the Yukon project. Other funds raised by private placements were used either for program expenditures or general operations, including the repayment of related party payables.
The Company raised $2.48M in flow through funds in October and November 2023, which resulted in a flow-through premium of $330,000; this was fully recovered as at July 31, 2024 and included in Other income. There was an additional $2.58M in flow through funds raised in December 2023, which resulted in a flow-through premium of $87,000; of this, $54,451 has been recovered and included in Other income during the three months ended July 31, 2024, with the remaining $32,549 recovered and included in Other income during the three months ended October 31, 2024. In December, 2024, the Company raised $600,000 in flow through funds, which resulted in a flow-through premium of $120,000, which was fully recovered and included in Other income to July 31, 2025. In August 2025, the Company completed financing of $5.28M in a combination of flow-through funds and non-flow through funds; a flow through premium of $901,700 was recorded for this financing, of which, $394,000 was recovered in the three month period ended October 31, 2025.
During the three month period ended July 31, 2024, the Company entered into a new lease agreement for an excavator and two drills in the Yukon, resulting in a significant Right of Use asset balance and an increase in Total assets; this balance was amortized over the course of the 16 month lease, with a $nil balance as at October 31, 2025.
The fluctuations in the net loss for the quarter ends are due mainly to the timing and extent of project costs, as well as the recovery of flow through premiums. The higher costs in the three month periods ended July 31 and October 31, 2024 and October 31, 2025 reflect that the Company was actively exploring. For the three month periods ended April 30, 2024 and April 30 and July 31, 2025, the smaller losses reflects the fact that there was not an active Yukon project. The 2023 drill program was operational from October to November 2023, resulting in higher costs for the period ended January 31, 2024. The three month period ended April 30, 2024 reflects the downtime of the Yukon program during the period. The Company then began incurring costs for the 2024 drill program, which ran from May to June 2024, before being shut down at the request of the First Nations for July 2024; drilling resumed in August 2024, and ran until the beginning of October 2024. The three month periods ending in January 31 and April 30, 2025 reflect the Yukon project being in maintenance mode. Planning began for the 2025 drill program in June and July, but did not commence until August 2025. This program ran until the middle of October, resulting in higher exploration costs for this period.
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Liquidity and Capital Resources
The Company has financed its operations to date primarily through the issuance of common shares and advances from related parties. The Company continues to seek capital through various means including joint venture partnerships and the issuance of equity and/or debt.
As at October 31, 2025, the Company had cash of $2,769,803 (July 31, 2025 – $212,078) and working capital deficit of $1,837,756 (July 31, 2024 – negative working capital of $151,546). Current market conditions may impact the Company's ability to raise further capital and fund ongoing operations.
The condensed consolidated interim financial statements have been prepared on a going concern basis, which assumes the realization of assets and liquidation of liabilities in the normal course of business. The ability of the Company to continue operations is dependent upon the existence of economically recoverable reserves, successful exploration of the Company's mineral properties, receive continued financial support, complete equity financings, and generate profitable operations in the future. As shown in the consolidated financial statements, the Company has suffered recurring losses. Management plans to obtain additional financing through future private placements for common shares or from the issuance of common shares upon the exercise of outstanding options and warrants. These conditions may raise significant doubt regarding the Company's ability to continue as a going concern. The condensed consolidated interim financial statements do not give effect to any adjustment should the Company be unable to continue as a going concern and therefore, be required to realize its assets and discharge its liabilities in other than the normal course of business and at amounts differing from those reflected in the condensed consolidated interim financial statements. There can be no assurance that sufficient working capital can be generated from operations and external financing to meet the Company's liabilities and commitments as they become due. Failure to generate sufficient working capital from operations or obtain external financing will cause the Company to curtail operations and the Company's ability to continue as a going concern will be impaired. It is not possible to predict whether economically recoverable reserves exist, the Company's financing efforts will be successful, or the Company will attain profitable level of operations.
In December 2024, the Company issued 4,000,000 flow-through shares for total proceeds of $600,000.
In July 2025, the Company received advance proceeds of $85,000 for the private placement that was announced that month. Total proceeds of $5,282,392 were received by the Company for the issuance of 5,731,372 Units (comprised of one non-flow through share and one non-flow through warrant) and 21,333,332 charity flow-through units (comprised of one flow-through share and one non-flow through warrant); each whole warrant issued in connection with either a CFT Unit or a Unit entitles the holder to acquire a non-flow through share at a price of $0.21 for a term of three years.
Off-Balance Sheet Arrangements
The Company has not entered into any off-balance sheet transactions.
Related Party Transactions
During the three month periods ended October 31, 2025 and 2024, the Company had related party transactions with the following individuals and companies related by way of common directors or shareholders:
- C.F. Mineral Research Ltd. ("CF Minerals") – a private company owned by Cantex Chairman, Charles Fipke. CF Minerals provides heavy mineral geochemistry services to the Company, as well as charging storage fees for project samples and supplies.
- Kel-Ex Development Ltd. ("Kel-Ex") – a private company owned by Cantex Chairman, Charles Fipke. Kel-Ex provides administration, payroll and office services to the Company, as well as providing exploration services such as equipment rentals.
- Element 29 Ventures Ltd. ("Element 29") – a private company owned by Cantex CEO, Chad Ulansky. Element 29 provides geological consulting services and equipment rentals to the Company.
- FourIrons Consulting ("FourIrons") – a private company owned by Cantex CFO, Jennifer Irons. FourIrons provides financial consulting services to the Company.
- Metalex Ventures Ltd. ("Metalex") – a publicly listed company with common directors and management. Metalex shares office space with Cantex and thus have certain shared expenditures which get re-billed on a cost-recovery basis.
The Company's related party expenses (net of recoveries) consist of the following amounts:
| Three month periods ended October 31, | ||
|---|---|---|
| 2025 | 2024 | |
| Laboratory and mineralogical costs, including storage fees* | $ 18,535 | $ 16,786 |
| Geological consulting fees* | 83,529 | 57,852 |
| Consulting fees** | 14,059 | 13,225 |
| Shared field expenditures* | 777,952 | 559,667 |
| Shared office and administrative costs** | 6,399 | 7,320 |
| $ 900,474 | $ 654,850 |
- Costs are included in Exploration expenditures in the Statement of profit and loss
** Costs are included in Office and administrative expenditures in the Statement of profit and loss
The Company's related party expenses relate to the following related parties:
| Three month periods ended October 31, | ||
|---|---|---|
| 2025 | 2024 | |
| C.F. Mineral Research Ltd. | $ 18,535 | $ 16,786 |
| Element 29 Ventures Ltd. | 394,253 | 300,629 |
| FourIrons Consulting | 14,059 | 13,225 |
| Kel-Ex Development Ltd. | 458,552 | 301,802 |
| Metalex Ventures Ltd. | 15,075 | 22,408 |
| $ 900,474 | $ 654,850 |
The above noted transactions represent amounts incurred or accrued, but not necessarily paid, during the periods indicated. The decrease in shared field expenditures is related to the Yukon exploration program. Shared field expenditures represent a combination of camp and field supplies, vehicle rental and travel/field expenditures paid directly by a related party on behalf of the Company and later re-billed.
The liabilities of the Company include the following amounts due to related parties, which are due on demand and unsecured. Overdue amounts due to C.F. Mineral Research Ltd. may be charged a service charge of 1.5% per month; the remaining balances are non-interest bearing:
| October 31, 2025 | July 31, 2025 | |
|---|---|---|
| C.F. Mineral Research Ltd. | $ 61,781 | $ 43,246 |
| Element 29 Ventures Ltd. | 106,566 | 41,207 |
| FourIrons Consulting | 5,373 | 3,623 |
| Kel-Ex Development Ltd. | 191,486 | 60,065 |
| Metalex Ventures Ltd. | 15,829 | 3,683 |
| $ 381,035 | $ 151,824 |
Risks and Uncertainties
The business of mineral deposit exploration and extraction involves a high degree of risk. Few properties that are explored ultimately become producing mines. At present, none of the Company's properties has a known commercial ore deposit. The market prices for silver, gold and other metals can be volatile and there is no assurance that a profitable market will exist for a production decision to be made or for the ultimate sale of the metals even if commercial quantities of precious and other metals are discovered.
The Company currently carries out exploration on mineral concessions that it holds directly from governments. Although the Company makes all reasonable effort to ensure secure title, there is no guarantee that title to properties in which the Company has will not be challenged or impugned. These properties may be subject to prior unregistered agreements or transfers and title may be affected by undetected defects. There is also no
guarantee that any of the prospecting license or exploration permits granted in connection with the properties will be renewed upon their normal expiry. Notwithstanding the foregoing, the Company has not experienced any difficulties with renewals to date.
Additional future funds may be required to maintain and advance exploration properties. Historically, the only sources of such funds have been the sale of equity capital and limited debt. Given the current volatile state of financial markets, there are no assurances that sources of financing will be available on acceptable terms, or at all. To date, the Company has relied on advances from a related party to fund its operations and expects continued support. The Company's equity financings are sourced in Canadian Dollars but, for the most part, the Company incurs its expenditures in local currencies or in US dollars. At this time, there are no currency hedges in place.
The Company operates in the Middle Eastern country of Yemen that has a varied political past and, at times, conflicts with neighboring countries and civil war. Changing political situations may affect the manner in which the Company operates.
There are many external factors that can adversely affect general workforces, economies and financial markets globally. Examples include, but are not limited to, global pandemic and political conflict in other regions. It is not possible for the Company to predict the duration or magnitude of adverse results of such external factors and their effect on the Company's business or ability to raise funds.
Financial Instruments
The carrying values of cash, trade and other receivables, reclamation bonds and trade and other payables and amounts due to related parties approximate their fair value as at October 31, 2025 due to their short-term nature. No reclassifications or de-recognition of financial instruments occurred in the period.
The Company's financial instruments are exposed to certain financial risks, including currency, credit, liquidity and price risk.
Currency risk - The Company is exposed to the financial risk related to the fluctuation of foreign exchange rates. The Company operates in Yemen and as such, a portion of its expenses are incurred in the local currency and US dollars. A significant change in the currency exchange rates could have an effect on the Company's results of operations, financial position or cash flows. The Company has not hedged its exposure to currency fluctuations.
As at October 31, 2025, the Company is exposed to currency risk relating to funds held in U.S. dollars and Yemen rials with a value of approximately $136,018 (July 31, 2025 - $88,747). The impact of a 5% change in the U.S. dollar and Yemen rials exchange rate to the Canadian dollar would not affect the decisions of the Company's operations plans.
Credit risk - Credit risk is the risk of an unexpected loss if a customer or third party to a financial instrument fails to meet its contractual obligations. The majority of the Company's cash is held through a large Canadian financial institution with a high investment grade rating.
The Company has no financial assets that are past due or impaired due to credit risk defaults. The Company's receivables consist only of GST receivable due from the Federal Government of Canada. The Company is subject to the risk that its joint venture partners will default on amounts owing for their portion of exploration expenditures. To date, the Company's receivables have been collected in full.
Liquidity risk - Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company manages its liquidity risk through the management of its capital structure and financial leverage as outlined in Note 12 to the condensed consolidated interim financial statements.
Trade and other payables are generally due within 30 days. No significant amounts are past due. Amounts due to related parties have no fixed terms of repayment, are unsecured and are non-interest bearing.
Price risk - The Company is exposed to price risk with respect to commodity prices. The Company closely monitors commodity prices to determine the appropriate course of action to be taken by the Company.
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Capital Management
The Company includes cash and equity, comprising of issued common shares, reserves and deficit, in the definition of capital.
The Company's objective when managing capital is to maintain its ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders.
The Company expects its current capital resources will not be sufficient to complete its exploration and development plans and operations through its current operating period and will be required to raise additional funds through future equity issuances or secure other financing. To date, the Company has relied on advances from related parties to fund its operations and expects continued financial support through the next twelve months. The Company is currently not subject to externally imposed capital requirements. The Company does not pay out dividends. The Company's investment policy is to invest its short-term excess cash in secure deposits in large Canadian financial institutions.
The Company's primary objective with respect to capital management is to ensure adequate liquid capital resources are in place to fund the exploration and development of its mineral properties while maintaining its ongoing operations. To secure additional capital to pursue these plans, the Company may attempt to raise funds through the issuance of debt and or equity.
Recent Accounting Pronouncements
The IASB issued a number of new and revised International Accounting Standards, IFRS amendments and related interpretations which are effective for the Company's financial year beginning on or after August 1, 2011. For the purpose of preparing and presenting the financial information for the relevant periods, the Company has consistently adopted all these new standards for the relevant reporting periods.
These consolidated financial statements have been prepared in accordance with IFRS effective as of July 31, 2025.
Outstanding Share Data
The authorized share capital of the Company is an unlimited number of common shares without par value.
As at December 23, 2025, the Company has outstanding 158,826,082 common shares, 2,100,000 stock options with a weighted average exercise price of $0.50 per share and 29,958,064 warrants with a weighted average exercise price of $0.21.
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