Dixie Gold Inc. — Interim / Quarterly Report 2026

Apr 6, 2026

Dixie Gold Inc.

Condensed Interim Financial Statements
For the Three Months Ended March 31, 2026 and 2025
(expressed in Canadian dollars, except where indicated)
(Unaudited)

---

NOTICE OF NO AUDITOR REVIEW OF INTERIM FINANCIAL STATEMENTS

Under National Instrument 51-102, Part 4, subsection 4.3(3)(a), if an auditor has not performed a review of the interim financial statements, they must be accompanied by a notice indicating that the financial statements have not been reviewed by an auditor.

The accompanying unaudited interim financial statements of the Company have been prepared by and are the responsibility of the Company's management.

The Company's independent auditor has not performed a review of these financial statements in accordance with standards established by the Chartered Professional Accountants of Canada for a review of interim financial statements by an entity's auditor.

---

Dixie Gold Inc.

Condensed Interim Statements of Financial Position

(Expressed in Canadian dollars, except where indicated)

(Unaudited)

	Note	March 31, 2026	December 31, 2025
Assets		$	$
Current assets
Cash		73,096	153,021
Other receivables		5,954	3,894
Prepaid expenses		2,380	2,380
Total current assets		81,430	159,295
Exploration and evaluation assets (“E&EA”)	5	39,610	16,270
Total assets		121,040	175,565
Liabilities
Current liabilities
Accounts payable and accrued liabilities		8,000	18,171
Total liabilities		8,000	18,171
Shareholders’ equity
Share capital	6	10,707,849	10,707,849
Reserves	7	1,548,250	1,548,250
Deficit		(12,143,059)	(12,098,705)
Total shareholders’ equity		113,040	157,394
Total liabilities and shareholders’ equity		121,040	175,565

Nature of operations (note 1)

Approved and authorized for issue on behalf of the Board on April 6, 2026:

“Brian Hearst” Director “Michael J. England” Director

The accompanying notes are an integral part of these condensed interim financial statements.

---

Dixie Gold Inc.
Condensed Interim Statements of Loss and Comprehensive Loss

(Expressed in Canadian dollars, except where indicated)

(Unaudited)

		For the three months ended March 31
	Note	2026	2025
Expenses		$	$
General and administrative	8	36,854	42,917
Professional fees	8	7,500	7,500
Net loss and comprehensive loss for the period		(44,354)	(50,417)
Loss per share
Basic and diluted		(0.00)	(0.00)
Weighted average number of shares outstanding
Basic and diluted		31,737,188	31,737,188

The accompanying notes are an integral part of these condensed interim financial statements.

---

Dixie Gold Inc.

Condensed Interim Statements of Changes in Shareholders' Equity

(Expressed in Canadian dollars, except where indicated)

(Unaudited)

			Reserves
	Common shares outstanding	Share capital	Share based compensation reserves	Warrants reserves	Deficit	Total shareholders' equity
		$	$	$	$	$
Balance at December 31, 2024	31,737,188	10,707,849	1,229,970	318,280	(11,387,025)	869,074
Net and comprehensive loss for the period	-	-	-	-	(50,417)	(50,417)
Balance at March 31, 2025	31,737,188	10,707,849	1,229,970	318,280	(11,437,442)	818,657
Net and comprehensive loss for the period	-	-	-	-	(661,263)	(661,263)
Balance at December 31, 2025	31,737,188	10,707,849	1,229,970	318,280	(12,098,705)	157,394
Net and comprehensive loss for the period	-	-	-	-	(44,354)	(44,354)
Balance at March 31, 2026	31,737,188	10,707,849	1,229,970	318,280	(12,143,059)	113,040

The accompanying notes are an integral part of these condensed interim financial statements.

---

Dixie Gold Inc.

Condensed Interim Statements of Cash Flows

(Amounts expressed in Canadian dollars, except where indicated)

(Unaudited)

	For the three months ended March 31,
	2026	2025
Cash flows used in operating activities	$	$
Net and comprehensive loss for the period	(44,354)	(50,417)
Items not affecting cash
Change in non-cash operating working capital
Increase in other receivables	(2,060)	(2,349)
Increase in prepaid expenses	-	(7,438)
Decrease in accounts payable and accrued liabilities	(10,171)	(5,425)
	(56,585)	(65,629)
Cash flows used in investing activities
Expenditures on exploration and evaluation assets	(23,340)	(49,470)
	(23,340)	(49,470)
Decrease in cash	(79,925)	(115,099)
Cash - beginning of the period	153,021	410,287
Cash - end of the period	73,096	295,188
SUPPLEMENTAL CASH FLOW INFORMATION
Cash paid for interest	-	-
Cash paid for income taxes	-	-

The accompanying notes are an integral part of these condensed interim financial statements.

---

Dixie Gold Inc.

Notes to the Condensed Interim Financial Statements

March 31, 2026 and 2025

(Amounts expressed in Canadian dollars, except where indicated)

(Unaudited)

1 Nature of operations

Dixie Gold Inc. (the "Company") was incorporated on August 24, 2011, pursuant to the Business Corporation Act (Alberta) and was continued into British Columbia under the Business Corporation Act (British Columbia) on November 10, 2015. The Company is extra-provincially registered in the province of Saskatchewan, as well as in the territories of Nunavut and Northwest Territories. The Company holds mineral tenures for the purpose of exploring for and developing mineral resources and is considered to be in the exploration stage. The Company's registered office is 1890-1075 West Georgia Street, Vancouver, B.C., V6E 3C9. These financial statements have been prepared on a going concern basis, which presumes the realization of assets and discharge of liabilities in the normal course of business for the foreseeable future. The Company's ability to continue as a going concern is dependent upon its ability in the future to achieve profitable operations and, more immediately, to obtain the necessary financing to meet its obligations and pay liabilities as they become due. External financing, predominantly by the issuance of equity, is expected to be sought to finance the operations of the Company. Such uncertainties, including uncertainties that may exist around the Company's ability to source capital through either new financing and/or the disposition of assets, cast significant doubts regarding the Company's ability to continue as a going concern. These financial statements do not include any adjustments to the amounts and classification of assets and liabilities that might be necessary should the Company be unable to continue in business.

2 Basis of presentation

These condensed interim financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") applicable to the preparation of interim financial statements, including IAS 34, Interim Financial Reporting. These condensed interim financial statements should be read in conjunction with the Company's audited financial statements for the year ended December 31, 2025, which have been prepared in accordance with IFRS issued by the IASB.

These financial statements of the Company have been prepared on a historical cost basis except for certain financial assets measured at fair value. These financial statements have been prepared using the accrual basis of accounting, except for cash flow information. The financial statements are presented in Canadian dollars which is the Company's functional and presentation currency.

3 Estimates, risks and uncertainties

The preparation of the Company's financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities and contingent liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Estimates and assumptions are continuously evaluated and are based on management's experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

However, actual outcomes can differ from these estimates.

The following areas required a significant degree of estimation:

a) Recoverability of exploration and evaluation assets

Management has determined that exploration, evaluation and related costs incurred which were capitalized may have future economic benefits and may be economically recoverable. Management uses several criteria in its assessments of economic recoverability and probability of future economic benefits including geologic and other technical information, history of conversion of mineral deposits with similar characteristics to its own properties to proven and probable mineral reserves, scoping and feasibility studies, accessible facilities and existing permits.

b) Share-based compensation

The fair value of stock options issued are subject to the limitation of the Black-Scholes option pricing model, which incorporates market data and involves uncertainty in estimates used by management in the assumptions. The Black-Scholes option pricing model requires the input of highly subjective assumptions, including the volatility of share prices, and, as a result, changes in subjective input assumptions can materially affect the fair value estimate.

c) Income taxes

The calculation of income taxes requires judgment in applying tax laws and regulations, estimating the timing of the reversals of temporary differences, and estimating the reliability of deferred tax assets. These estimates impact current and deferred income tax assets and liabilities, and current and deferred income tax expense (recovery).

---

Dixie Gold Inc.

Notes to the Condensed Interim Financial Statements

March 31, 2026 and 2025

(Amounts expressed in Canadian dollars, except where indicated)

(Unaudited)

3 Estimates, risks and uncertainties (continued)

d) Going concern

The assessment of the Company’s ability to continue as a going concern and whether there are events or conditions that may give rise to significant uncertainty.

4 Material accounting policies

The accounting policies set out below have been applied consistently to all years presented in these financial statements. The financial statements have, in management's opinion, been properly prepared using careful judgment with reasonable limits of materiality and within the framework of the material accounting policies summarized below:

Cash and cash equivalents

Cash and cash equivalents comprise cash on deposit at banks and other highly liquid short-term investments, which may be settled on demand or within a maximum 90-day period to maturity.

Financial instruments

Classification

The Company classifies its financial instruments in the following categories: at fair value through profit and loss (“FVTPL”), at fair value through other comprehensive (loss) income (“FVOCI”), or at amortized cost. The Company determines the classification of financial assets at initial recognition. The classification of debt instruments is driven by the Company’s business model for managing the financial assets and their contractual cash flow characteristics. Equity instruments that are held for trading (including all equity derivative instruments) are classified as FVTPL. For other equity instruments, on the day of acquisition the Company can make an irrevocable election (on an instrument-by-instrument basis) to designate them as at FVOCI. Financial liabilities are measured at amortized cost, unless they are required to be measured at FVTPL (such as instruments held for trading or derivatives) or the Company has opted to measure them at FVTPL.

Measurement

i. Financial assets and liabilities at FVTPL and FVOCI

Financial assets and liabilities carried at FVTPL are initially recorded at fair value and transaction costs are expensed in the statements of net (loss) income. Realized and unrealized gains and losses arising from changes in the fair value of the financial assets and liabilities held at FVTPL are included in the statements of net (loss) income in the period in which they arise. Where management has opted to recognize a financial liability at FVTPL, any changes associated with the Company’s own credit risk will be recognized in other comprehensive (loss) income. The Company recognizes marketable securities at FVTPL. Elected investments in equity instruments at FVOCI are initially recognized at fair value plus transaction costs. Subsequently they are measured at fair value, with gains and losses arising from changes in fair value recognized in other comprehensive (loss) income.

ii. Financial assets and liabilities at amortized cost

A financial asset is measured at amortized cost if the objective of the business model is to hold the financial asset for the collection of contractual cash flows, and the asset's contractual cash flows are comprised solely of payments of principal and interest. They are classified as current assets or non-current assets based on their maturity date and are initially recognized at fair value and subsequently carried at amortized cost less any impairment.

Financial assets and liabilities at amortized cost, unless they are required to be measured at FVTPL or the Company has opted to measure at FVTPL, are initially recognized at fair value plus or minus transaction costs, respectively, and subsequently carried at amortized cost less any impairment.

iii. Impairment of financial assets at amortized cost

The Company recognizes a forward-looking basis on the expected credit losses (“ECL”) model on financial assets that are measured at amortized cost, contract assets and debt instruments carried at FVOCI.

At each reporting date, the Company measures the ECL for the financial asset at an amount equal to the lifetime expected credit losses if the credit risk on the financial asset has increased significantly since initial recognition. If at the reporting date, the financial asset has not increased significantly since initial recognition, the Company measures the ECL for the financial asset at an amount equal to twelve month expected credit losses. The Company applies the simplified method and measures a loss allowance equal to the lifetime expected credit losses for trade receivables.

---

Dixie Gold Inc.

Notes to the Condensed Interim Financial Statements

March 31, 2026 and 2025

(Amounts expressed in Canadian dollars, except where indicated)

(Unaudited)

4 Material accounting policies (continued)

The Company recognizes in the statement of net (loss) income, as an impairment gain or loss, the amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognized. The loss allowance was $Nil as at March 31, 2026 (December 31, 2025 - $Nil).

The Company’s assets and liabilities are recorded and measured as follows:

Financial assets/liabilities	Classification and measurement
Cash	FVTPL
Accounts payable and accrued liabilities	Amortized cost

i. Derecognition

Financial assets

The Company derecognizes financial assets only when the contractual rights to cash flows from the financial assets expire, or when it transfers the financial assets and substantially all of the associated risks and rewards of ownership to another entity.

Financial liabilities

The Company derecognizes a financial liability when its contractual obligations are discharged or cancelled or expired. The Company also derecognizes a financial liability when the terms of the liability are modified such that the terms and / or cash flows of the modified instrument are substantially different, in which case a new financial liability based on the modified terms is recognized at fair value.

Gains and losses on derecognition are generally recognized in profit or loss.

Impairment of non-financial assets

At the end of each reporting period the carrying amounts of the assets are reviewed to determine whether there is any indication that those assets are impaired. Impairment is recognized when the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the asset’s value in use and fair value less costs to sell. Fair value is determined as the amount that would be obtained from the sale of the asset in an arm’s length transaction between knowledgeable and willing parties. The impairment loss is recognized in profit or loss in the statement of loss and comprehensive loss.

Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but to an amount that does not exceed the carrying amount had no impairment loss been recognized. A reversal of an impairment loss is recognized immediately in profit or loss.

Exploration and evaluation expenditures

Pre-exploration costs

Pre-exploration costs are expensed in the period in which they are incurred.

Exploration and evaluation expenditures

Once the legal right to explore a property has been acquired, costs directly related to exploration and evaluation expenditures (“E&E”) are recognized and capitalized, in addition to the acquisition costs. These direct expenditures include such costs as materials used, surveying costs, drilling costs and payments made to contractors during the exploration phase. Costs not directly attributable to exploration and evaluation activities, including general administrative overhead costs, are expensed in the period in which they occur.

The Company may occasionally enter into option arrangements, whereby the Company may transfer part of a mineral interest, as consideration, for an agreement by the optionee to meet certain E&E which would have otherwise been undertaken by the Company. The Company does not record any expenditures made by the optionee on its behalf. Any cash or other consideration received from the agreement is credited against the costs previously capitalized to the mineral interest given up by the Company, with any excess consideration accounted for as a gain on disposal.

---

Dixie Gold Inc.

Notes to the Condensed Interim Financial Statements

March 31, 2026 and 2025

(Amounts expressed in Canadian dollars, except where indicated)

(Unaudited)

4 Material accounting policies (continued)

When a project is deemed to no longer have commercially viable prospects to the Company, E&E in respect of that project are deemed to be impaired. As a result, those exploration and evaluation expenditure costs, in excess of estimated recoveries, are written off to profit or loss in the statement of loss and comprehensive loss. The Company assesses exploration and evaluation assets for impairment when facts and circumstances suggest that the carrying amount of an asset may exceed its recoverable amount and at each reporting period end.

Under IFRS 6 Exploration for and Evaluation of Mineral Resources, one or more of the following facts and circumstances indicate that an entity should test exploration and evaluation assets for impairment:

i. The period for which the entity has the right to explore in the specific area has expired during the period or will expire in the near future, and is not expected to be renewed.
ii. Substantive expenditure on further exploration for and evaluation of mineral resources in the specific area is neither budgeted nor planned.
iii. Exploration for and evaluation of mineral resources in the specific area have not led to the discovery of commercially viable quantities of mineral resources and the entity has decided to discontinue such activities in the specific area.
iv. Sufficient data exist to indicate that, although a development in the specific area is likely to proceed, the carrying amount of the exploration and evaluation asset is unlikely to be recovered in full from successful development or by sale.

Once the technical feasibility and commercial viability of extracting the mineral resource has been determined, the property is considered to be a mine under development and is classified as 'mines under construction'. Exploration and evaluation assets are tested for impairment before the assets are transferred to development properties. As the Company currently has no operational income, any incidental revenues earned in connection with exploration activities are applied as a reduction to capitalized exploration costs. Mineral exploration and evaluation expenditures are classified as intangible assets.

Rehabilitation obligations

The Company recognizes the fair value of a legal or constructive liability for a rehabilitation obligation in the period in which it is incurred and when a reasonable estimate of fair value can be made. The carrying amount of the related long-lived asset is increased by the same amount as the liability. Changes in the liability for an asset retirement obligation due to the passage of time will be measured by applying an interest method of allocation. The amount will be recognized as an increase in the liability and an accretion expense in profit or loss in the statement of loss and comprehensive loss. Changes resulting from revisions to the timing or the amount of the original estimate of undiscounted cash flows are recognized as an increase or a decrease to the carrying amount of the liability and the related long-lived asset. The Company does not have significant rehabilitation obligations.

Income taxes

Income tax expense comprises of current and deferred tax. Current tax and deferred tax are recognized in net income or loss except to the extent that it relates to a business combination or items recognized directly in equity or in other comprehensive income (loss).

Current income taxes are recognized for the estimated income taxes payable or receivable on taxable income or loss for the current period and any adjustment to income taxes payable in respect of previous periods. Current income taxes are determined using tax rates and tax laws that have been enacted or substantively enacted by the year-end date.

Deferred tax assets and liabilities are recognized where the carrying amount of an asset or liability differs from its tax base, except for taxable temporary differences arising on the initial recognition of goodwill and temporary differences arising on the initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the transaction affects neither accounting nor taxable profit or loss.

Recognition of deferred tax assets for unused tax losses, tax credits and deductible temporary differences is restricted to those instances where it is probable that future taxable profit will be available against which the deferred tax asset can be utilized. At the end of each reporting year the Company reassesses unrecognized deferred tax assets. The Company recognizes a previously unrecognized deferred tax asset to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.

---

Dixie Gold Inc.

Notes to the Condensed Interim Financial Statements

March 31, 2026 and 2025

(Amounts expressed in Canadian dollars, except where indicated)

(Unaudited)

4 Material accounting policies (continued)

Share capital

Financial instruments issued by the Company are classified as equity only to the extent that they do not meet the definition of a financial liability or financial asset. The Company’s common shares, share warrants, options and flow-through shares are classified as equity instruments.

Incremental costs directly attributable to the issue of new shares, warrants or options are recognized as a deduction from equity, net of tax.

Valuation of equity units issued in private placements

The Company has adopted a residual value method with respect to the measurement of shares and warrants issued as private placement units. The residual value method first allocates value to the more easily measurable component based on fair value and then the residual value, if any, to the less easily measurable component.

The fair value of common shares issued in private placements was determined to be the more easily measurable component and are valued at their fair value, as determined by the closing quoted bid price on the announcement date. The balance, if any, is allocated to attached warrants. Any fair value attributed to warrants is recorded to warrants reserves.

Flow-through shares

Resource expenditure deductions for income tax purposes related to exploratory activities funded by flow-through share arrangements are renounced to investors in accordance with income tax legislation. Pursuant to the terms of the flow-through share agreements, these shares transfer the tax deductibility of qualifying resource expenditures to investors. On issuance, the Company bifurcates the flow-through share into i) a flow-through share premium, equal to the estimated premium, if any, investors pay for the flow-through feature, which is recognized as a liability, and ii) share capital. Upon expenses being renounced, the Company derecognizes the liability and recognizes a deferred tax liability for the amount of tax reduction renounced to the shareholders. The premium is recognized as other income and the related deferred tax is recognized as a tax provision.

Proceeds received from the issuance of flow-through shares are restricted to be used only for Canadian resource property exploration expenditures within a two-year period. The portion of the proceeds received but not yet expended at the end of the Company’s year is disclosed separately as flow-through share commitments, if any.

The Company may also be subject to a Part XII.6 tax on flow-through proceeds renounced under the Look-back Rule, in accordance with Government of Canada flow-through regulations. When applicable, this tax is accrued as a financing expense until qualifying expenditures are incurred.

Per share amounts

Basic earnings per common share is computed by dividing the net income for the period by the weighted average number of common shares outstanding for the period. Diluted per share amounts reflect the potential dilution that could occur if securities or other contracts to issue common shares were exercised or converted to common shares. The treasury stock method is used to determine the dilutive effect of stock options and other dilutive instruments. Under the treasury stock method, the weighted average number of shares outstanding used in the calculation of diluted earnings (loss) per share assumes that the deemed proceeds received from the exercise of stock options, share purchase warrants and their equivalents would be used to re-purchase common shares of the Company at the average market price during the period. When a loss is incurred during the period, basic and diluted loss per share is the same as the exercise of stock options is considered to be anti-dilutive.

Share-based payments

Where equity-settled share options are awarded to employees, the fair value of the options at the date of grant is charged to profit or loss in the statement of loss and comprehensive loss over the vesting period. Performance vesting conditions are taken into account by adjusting the number of equity instruments expected to vest at each reporting date so that, ultimately, the cumulative amount recognized over the vesting period is based on the number of options that eventually vest. Non-vesting conditions and market vesting conditions are factored into the fair value of the options granted. As long as all other vesting conditions are satisfied, a charge is made irrespective of whether these vesting conditions are satisfied. The cumulative expense is not adjusted for failure to achieve a market vesting condition or where a non-vesting condition is not satisfied.

11

---

Dixie Gold Inc.

Notes to the Condensed Interim Financial Statements

March 31, 2026 and 2025

(Amounts expressed in Canadian dollars, except where indicated)

(Unaudited)

4 Material accounting policies (continued)

Where the terms and conditions of options are modified before they vest, the increase in the fair value of the options, measured immediately before and after the modification, is also charged to profit or loss in the statement of loss and comprehensive loss over the remaining vesting period.

Where equity instruments are granted to non-employees, they are recorded at the fair value of the goods or services received in profit or loss in the statement of loss and comprehensive loss, unless they are related to the issuance of shares. Amounts related to the issuance of shares are recorded as a reduction of share capital.

When the value of goods or services received in exchange for the share-based payment cannot be reliably estimated, the fair value is measured by use of a valuation model. The expected life used in the model is adjusted, based on management's best estimate, for the effects of non-transferability, exercise restrictions, and behavioural considerations.

All equity-settled share-based payments are reflected in share-based compensation reserves, until exercised. Upon exercise, shares are issued from treasury and the amount reflected in share-based compensation reserves is credited to share capital, adjusted for any consideration paid. Share-based payments of options which expire unexercised remain in share-based compensation reserves.

Where a grant of options is cancelled or settled during the vesting period, excluding forfeitures when vesting conditions are not satisfied, the Company immediately accounts for the cancellation as an acceleration of vesting and recognizes the amount that otherwise would have been recognized for services received over the remainder of the vesting period. Any payment made to the employee on the cancellation is accounted for as the repurchase of an equity interest except to the extent the payment exceeds the fair value of the equity instrument granted, measured at the repurchase date. Any such excess is recognized as an expense.

Mineral tax credit

Federal and Provincial taxation authorities provide companies with tax incentives for undertaking mineral exploration programs within certain geographic regions and within certain types of commodities. The Company accrues these credits as a reduction of exploration and evaluation expenditures in the period that the related expenditures were incurred. These accrued credits are subject to review by the relevant authorities and adjustments, if any, resulting from such a review are recorded in the period that the tax filings are amended.

Joint Arrangements

Certain of the Company's activities are conducted through joint arrangements in which two or more parties have joint control. A joint arrangement is classified as either a joint operation or a joint venture, depending on the rights and obligations of the parties to the arrangement.

Joint operations arise when the Company has a direct ownership interest in jointly controlled assets and obligations for liabilities. The financial statements include the Company's interest in the assets, liabilities, revenues, expenses, and cash flows of this type of arrangement. Joint ventures arise when the Company has rights to the net assets of the arrangement. For these arrangements the Company uses the equity method of accounting and recognizes initial and subsequent investments at cost, adjusting for the Company's share of the joint venture's income or loss, less dividends received thereafter. Joint ventures are tested for impairment whenever objective evidence indicates that the carrying amount of the investment may not be recoverable under the equity method of accounting. The impairment amount is measured as the difference between the carrying amount of the investment and the higher of its fair value less costs of to sell and its value in use. Impairment losses are reversed in subsequent periods if the amount of the loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognized.

New accounting standards, interpretation and amendments adopted

Amendments to IAS 1 – Classification of Liabilities as Current or Non-current

In January 2020, the IASB issued amendments to IAS 1 - Presentation of Financial Statements to specify the requirements for classifying liabilities as current or non-current. The amendments clarify that the classification of liabilities as current or non-current is based on rights that are in existence at the end of the reporting period, specify that classification is unaffected by expectations about whether an entity will exercise its right to defer settlement of a liability, explain that rights are in existence if covenants are complied with at the end of the reporting period, and introduce a definition of 'settlement' to make clear that settlement refers to the transfer to the counterparty of cash, equity instruments, other assets or services. These amendments are effective for annual periods beginning on or after January 1, 2024, and did not have a material impact on the Company's financial statements.

12

---

Dixie Gold Inc.

Notes to the Condensed Interim Financial Statements

March 31, 2026 and 2025

(Amounts expressed in Canadian dollars, except where indicated)

(Unaudited)

4 Material accounting policies (continued)

New accounting standards not yet effective

IFRS 18 Presentation and Disclosure in Financial Statements

IFRS 18 introduces three sets of new requirements to give investors more transparent and comparable information about companies' financial performance for better investment decisions.

1. Three defined categories for income and expenses—operating, investing and financing—to improve the structure of the income statement, and require all companies to provide new defined subtotals, including operating profit.
2. Requirement for companies to disclose explanations of management-defined performance measures that are related to the income statement.
3. Enhanced guidance on how to organize information and whether to provide it in the primary financial statements or in the notes.

This new standard is effective for reporting periods beginning on or after January 1, 2027. The Company will be assessing the impact of adopting the above standard on the financial statements.

5 Exploration and evaluation assets

	Red Lake Gold Project	Phoenix and Torp Lithium Projects	Other	Total
	$	$	$	$
December 31, 2024	475,416	-	-	475,416
Tenure acquisition / lease fees	2,900	6,140	83,064	92,104
Impairment on exploration and evaluation assets	(478,316)	(6,140)	(66,794)	(551,250)
December 31, 2025	-	-	16,270	16,270
Tenure acquisition / lease fees	-	6,140	17,200	23,340
March 31, 2026	-	6,140	33,470	39,610

Red Lake Gold Project (Ontario)

The Red Lake Gold Project held (subject to certain royalty obligations) by the Company is located immediately adjacent to the Great Bear Project being advanced by Kinross Gold Corporation (through its acquisition of Great Bear Resources Ltd. in early 2022).

At the end of the fourth quarter of 2019, the Company first acquired a large portfolio of claims, being 1,044 mining claims covering approximately 21,258 ha (52,507 acres), situated in the emerging Dixie Gold District near Red Lake, Ontario, in exchange for a cash payment of $52,200 and the assumption of a pre-existing two percent gross royalty.

During Q1 2020, the Company then expanded its Red Lake Gold Project through the purchase of an additional 197 mining claims covering approximately 4,011 ha (9,907 acres) in exchange for a payment of $12,000 and the assumption of a pre-existing two percent gross royalty. Subsequent to the aforementioned, the Company held a combined total of 1,241 mining claims in the project area (being the above-described addition total of 1,044 and 197 mining claims, respectively).

On November 3, 2021, the Company announced that it has entered into a definitive agreement with a subsidiary of Barrick Gold Corp. ("Barrick Gold") whereby the Company granted the right to Barrick Gold, in an operatorship capacity, to earn a 70% interest in the Company's Red Lake Gold project (the "Earn-In Agreement").

On June 7, 2022, the Company delivered a termination letter to Barrick Gold in relation to the Earn-In Agreement as involved the Red Lake Gold Project, which was the subject of the aforementioned exploration earn-in agreement, pursuant to provision pertaining to incurable material breaches.

---

Dixie Gold Inc.

Notes to the Condensed Interim Financial Statements

March 31, 2026 and 2025

(Amounts expressed in Canadian dollars, except where indicated)

(Unaudited)

5 Exploration and evaluation assets (continued)

On June 30, 2022, the Company was named in a Statement of Claim (the "Claim") in Ontario, Canada as issued by Barrick Gold (Note 11). The Company retained Lenczner Slaght LLP of Toronto, Ontario and intended to defend the Claim.

During 2022, Barrick Gold performed certain exploration work at the Red Lake Project and the resulting assessment report was publicly filed with the relevant provincial authority.

On April 17, 2023, the Company entered into a termination and mutual release agreement (the "Mutual Release Agreement") whereby Dixie Gold and Barrick Gold agreed to resolve matters related to the Claim (Note 11).

On July 9, 2024, the Company sold four mining claims of its Red Lake Gold Project by way of a purchase-and sale agreement with Great Bear Resources Ltd., an arm's-length party and subsidiary of Kinross Gold Corporation. The Company received cash consideration of $100,000 and was granted a 2.5% production royalty (NSR) on any mineral production from the four mining claims.

Under IFRS accounting policies, the Company impaired the carrying value of $478,316 (2024 - $Nil) during the year ended December 31, 2025 (see associated MD&A for related discussion).

Phoenix and Torp Lithium Projects

On May 20, 2016, the Company acquired the Torp Lake and Phoenix mining claims from North Arrow Minerals Inc.

Under IFRS accounting policies, the Company impaired the carrying value of $6,140 (2024 - $466,202) during the year ended December 31, 2025 (see associated MD&A for related discussion).

Soo East Copper Project

During the year ended December 31, 2025, the Company acquired various mining claims in the amount of $16,270 in northeast of Sault Ste. Marie, Ontario through staking, such mining claims now comprising the Company's Soo East Copper Project.

Pickle Crow East Gold Project

During the three months ended March 31, 2026, the Company acquired various mining claims in the amount of $17,200 in Ontario through staking, such mining claims now comprising the Company's Pickle Crow East Gold Project.

East Preston Uranium Project

On March 27, 2017, the Company, in conjunction with Preston Uranium Project partner Skyharbour Resources Ltd. ("Skyharbour"), executed an option agreement with Azincourt Energy Corp. ("Azincourt") which provides Azincourt an earn-in option to acquire a 70-per-cent working interest in a portion of the Preston uranium project known as the East Preston Uranium Project.

On February 17, 2021, Azincourt had completed its earn-in of a 70% interest in the East Preston Uranium Project and had formed a joint-venture with the Company and Skyharbour Resources Ltd., in which the Company received an initial minority interest of 15% at the time the joint-venture was formed.

As result of non-participation in exploration programs since the formation of the aforementioned joint-venture, and as at March 31, 2026, the Company's effective interest in the East Preston Uranium Project is estimated to be approximately 4.0% (December 31, 2025 – 4.0%).

Discontinued Interests

Preston Uranium Project (Discontinued)

On March 7, 2017, the Company, in conjunction with Preston Uranium Project partner Skyharbour, executed an option agreement with Orano Canada Inc. ("Orano Canada") which provided Orano Canada an earn-in option to acquire up to a 70-per-cent working interest in a portion of the Preston Uranium Project. On March 26, 2021, Orano Canada earned a 51% interest in the Preston Uranium Project and had formed a joint-venture with the Company and Skyharbour.

On October 31, 2025, the Company sold all of its interest in the Preston Uranium Project by way of the execution of an arm's-length purchase-and-sale agreement with Orano Canada and Skyharbour for cash of $100,000.

---

Dixie Gold Inc.

Notes to the Condensed Interim Financial Statements

March 31, 2026 and 2025

(Amounts expressed in Canadian dollars, except where indicated)

(Unaudited)

5 Exploration and evaluation assets (continued)

Rottenstone Area Mining Claims (Discontinued)

During the year ended December 31, 2025, the Company staked a number of dispositions in the amount of $66,794 in Saskatchewan. The Company does not plan to allocate a material amount of forward capital to exploration of the Rottenstone Area Mining Claims in the near future, and as a result, decided to impair the carrying value of $66,794 during the year ended December 31, 2025.

6 Share Capital

a) The Company’s authorized share capital consists of an unlimited number of common shares without par value and unlimited number of first and second preference shares without nominal or par value, with the rights, privileges and conditions thereof determined by the directors of the Company at the time of issuance.

b) 2026 share capital activities:

There was no share capital activity for the three months ended March 31, 2026.

c) 2025 share capital activities:

There was no share capital activity for the year ended December 31, 2025.

7 Share-based Compensation

a) Stock options

The Company has a stock option plan for employees, directors, officers and consultants. Stock options can be issued up to a maximum 3,173,719 stock options. The exercise price of options granted is not less than the market price of the common shares traded less the available discount under TSX Venture Exchange policies, and is determined by the Board of Directors. Options granted can have a term of up to 10 years.

	March 31, 2026		December 31, 2025
	Number of options (000's)	Weighted average exercise price	Number of options (000's)	Weighted average exercise price
Outstanding - beginning	1,225	$ 0.06	1,225	$ 0.06
Granted	-	-	-	-
Outstanding - ending	1,225	0.06	1,225	0.06

The following table discloses the number of options and vested options outstanding as at March 31, 2026:

Number of options outstanding (*000s)	Number of options exercisable (*000s)	Price per share ($)	Expiry Date
1,125	1,125	0.06	April 9, 2029
100	100	0.06	December 23, 2029
1,225	1,225

---

Dixie Gold Inc.

Notes to the Condensed Interim Financial Statements

March 31, 2026 and 2025

(Amounts expressed in Canadian dollars, except where indicated)

(Unaudited)

7 Share-based Compensation (continued)

b) Share purchase warrants

Changes in share purchase warrants issued and outstanding are as follows:

	March 31, 2026		December 31, 2025
	Number of warrants (000's)	Weighted average exercise price	Number of warrants (000's)	Weighted average exercise price
Outstanding - beginning	6,000	$	6,000	$
		0.05		0.05
Issued	-	-	-	-
Outstanding - ending	6,000	0.05	6,000	0.05

The following table discloses the number of share purchase warrants outstanding as at March 31, 2026:

Number of warrants outstanding (*000s)	Exercise price ($)	Expiry Date	Remaining life (years)
5,000	0.05	March 15, 2029	2.96
1,000	0.05	October 17, 2029	3.52
6,000	0.05		3.06

8 Related Party Transactions

Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Related parties may be individuals or corporate entities. The Company has identified its directors and officers as its key management personnel.

Related Party Transactions (Cash Transactions)

	March 31, 2026	March 31, 2025
	$	$
Professional fees	7,500	7,500
Consulting	15,875	30,000

(1) During the three months ended March 31, 2026, the Company incurred consulting fees of $15,000 (2025 - $30,000) to a company controlled by the former CEO of the Company (management consulting services) and $875 (2025 - $Nil) to a company controlled by a Director of the Company (consulting services).

(2) During the three months ended March 31, 2026, the Company incurred professional fees of $7,500 (2025 - $7,500) to an accounting firm in which the CFO of the Company is a partner.

These transactions are in the normal course of operations and are measured at the exchange amount, which is the amount of consideration established and agreed to by the related parties, unless otherwise noted.

---

Dixie Gold Inc.

Notes to the Condensed Interim Financial Statements

March 31, 2026 and 2025

(Amounts expressed in Canadian dollars, except where indicated)

(Unaudited)

9 Capital Management

The Company includes cash and shareholders' equity, comprising of issued common shares, share-based compensation reserves and warrants reserves, deficit and accumulated other comprehensive loss in the definition of capital. The Company manages its capital structure and makes adjustments to it, based on the funds available to the Company, in order to support the acquisition, exploration and development of mineral properties. Given the standing of the Company as an exploration-stage company, the Board of Directors does not establish quantitative return on capital criteria for management, but rather relies on the expertise of the Company's management to sustain future development of the business.

The properties in which the Company currently has interests are in the exploration stage; as such the Company is dependent upon external financings and/or asset dispositions to fund activities. In order to carry out planned exploration and pay for administrative costs, the Company will spend its existing working capital and raise additional funds as needed. The Company will continue to assess new properties and seek to acquire an interest in additional properties if it feels there is sufficient geologic or economic potential and if it has adequate financial resources to do so.

Management reviews its capital management approach on an ongoing basis and believes that this approach, given the relative size of the Company, is reasonable. There were no material changes in the Company's approach to capital management during the three months ended March 31, 2026. The Company is not subject to externally imposed capital requirements.

10 Financial Instruments

For disclosure purposes, all financial instruments measured at fair value are categorized into one of three hierarchy levels, described below. Each level is based on the transparency of the inputs used to measure the fair values of assets and liabilities:

Level 1 – quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2 – inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and

Level 3 – inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The Company enters into financial instruments to finance its operations in the normal course of business. The fair values of cash, receivables and accounts payable and accrued liabilities approximate their carrying values due to the short-term maturity of these instruments. Cash is carried at fair value using a level 1 fair value measurement.

The Company holds various forms of financial instruments. The nature of these instruments and the Company's operations exposes the Company to concentration risk, credit risk, liquidity risk, commodity price risk, and foreign exchange risk. The Company manages its exposure to these risks by operating in a manner that minimizes its exposure to the extent practical.

Concentration Risk

As at March 31, 2026, substantially all the Company's cash was held at a major Canadian financial institution. As a result, the Company was exposed to all of the risks associated with this institution.

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 liquidity risk by forecasting its cash flows from operations and anticipating investing and financing activities. Senior management is actively involved in the review and approval of planned expenditures. As at March 31, 2026, the Company's working capital of $73,430 (December 31, 2025 - $141,124) is sufficient to meet its short-term business requirements. Future operations and/or exploration programs will require additional financing, which, if attainable, is expected to be funded through capital market raises and/or project divestment.

Commodity Price Risk

The value of the Company's mineral resource properties is related to the price of various commodities and the outlook for them. Commodity prices have historically fluctuated widely and are affected by numerous factors outside of the Company's control, including, but not limited to, industrial retail demand, central bank lending, forward sales by producers and speculators, level of worldwide production and short-term changes in supply and demand.

Foreign Exchange Risk

Currency risk is the risk to the Company's operations that arise from fluctuations of foreign exchange rates and the degree of volatility of these rates. The Company does not use derivative instruments to reduce its exposure to foreign currency risk. As at March 31, 2026, the Company had no monetary assets or liabilities in foreign currencies.

---

Dixie Gold Inc.

Notes to the Condensed Interim Financial Statements

March 31, 2026 and 2025

(Amounts expressed in Canadian dollars, except where indicated)

(Unaudited)

10 Financial Instruments (continued)

Equity Price Risk

Equity price risk arises from market fluctuations in equity prices that could adversely affect the Company’s operations. The Company’s current exposure to equity price risk is limited to declines in the values and volumes including those of its own shares, which could impede its ability to raise additional funds when required and movements in individual equity prices or general movements in the level of the stock market. The Company closely monitors the individual equity movements and the stock market to determine the appropriate course of action to be taken by the Company.

11 Legal Matters (Discontinued)

On June 30, 2022, the Company was named as a party in a statement of claim issued by Barrick Gold Inc. in the Toronto Superior Court of Justice (court file No.: CV-22-00683409-0000) (the “Claim”). The Claim alleges, among other things, that the Company breached certain obligations in an earn-in and joint venture agreement related to the Red Lake Gold Project to pursue more lucrative commercial arrangements concerning the Company’s mining claims. The Company retained Lenczner Slaght LLP of Toronto, Ontario and intended to defend the Claim. On April 17, 2023, the Company entered into a termination and mutual release agreement (the “Mutual Release Agreement”) whereby Dixie Gold and Barrick Gold agreed to resolve matters related to the Claim.

On March 1, 2024 the Company filed a Statement of Claim, as plaintiff, against Omnia Metals Group Ltd related to the Agreement and the Takeover Transaction (defined hereafter in Item 12). On April 2, 2024, the Company agreed to settle and resolve the Statement of Claim. As part of the settlement, the Company received cash of $50,000 during the year ended December 31, 2024. Matters contemplated by the Agreement are terminated and the Takeover Transaction is not proceeding. A consent dismissal order (CDO) was executed by counsel for the parties in the Supreme Court of British Columbia on April 18, 2024.

12 Proposed Takeover Transaction (Discontinued)

On October 24, 2023, the Company entered into an agreement (the “Agreement”) whereby it was proposed that the Company would be acquired by ASX-listed issuer Omnia Metals Group Ltd. (“Omnia”). Under the Agreement, Omnia made binding terms to acquire 100% of the issued and outstanding common shares of the Company in exchange for 166,666,667 common shares of Omnia and a further $3 million cash component (the “Takeover Transaction”). As part of and under the Agreement, Omnia paid the Company a fee of $300,000.

On March 1, 2024, the Company filed a Statement of Claim against Omnia related to the Agreement and the Takeover Transaction (court file No. VLC-S-S-241442). As set out in the Statement of Claim, (1) Omnia claims that it has not been able to raise funds represented as having firm commitment in the Agreement and Omnia asserts that it cannot successfully complete a capital raise related to the Takeover Transaction, and (2) Omnia claims to have identified shareholders of Omnia who would block approval of the Takeover Transaction at an Omnia shareholder meeting. The Company intends to address the matter through the Statement of Claim and the procedures afforded to it by the Supreme Court of British Columbia. The Statement of Claim was filed on behalf of the Company by Bojm, Funt & Gibbons LLP, which advised the Company as its retained litigation counsel.

On April 2, 2024, the Company agreed to settle the Statement of Claim.

Matters contemplated by the Agreement are terminated and the Takeover Transaction did not proceed.

13 Segmented information

The Company presently operates in one industry segment being the acquisition and exploration of mineral projects in one geographical jurisdiction (Canada), as outlined in Note 5 above.