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Newfoundland Discovery Corp. Management Reports 2026
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Management Reports
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NEWFOUNDLAND
DISCOVERY CORP.
Management’s Discussion & Analysis
Nine months ended January 31, 2026
Containing information as of March 31, 2026
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Caution Regarding Forward-Looking Information
are "forward-looking information" or "forward-looking statements" within the meaning of the Securities Act (British Columbia). This includes statements by the Company concerning exploration results, including deposit size, quantities, grades and contained metals, which are generally based on estimations and extrapolations from a limited number of samples, drill holes and assays. These estimations and extrapolations are subject to uncertainties, which include but are not limited to uncertainties in evaluating a deposit until the deposit has been extensively drilled on closely spaced intervals. Should one or more of these underlying estimations or extrapolations prove incorrect, actual results may vary materially from those described in forward-looking statements.
Forward-looking statements contained herein also include the Company's future operating costs and exploration plans at its mineral properties. These involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information. Forward-looking information is subject to a variety of risks and uncertainties which could cause actual events or results to differ from those reflected in the forward-looking information, including, without limitation, the ability of the Company to continue to be able to access the capital markets for funding necessary for operating costs, to acquire and maintain exploration properties and to carry out its desired exploration programs; difficulties in executing exploration programs on the Company's proposed schedules and within its cost estimates, whether due to weather conditions in the areas where it operates, increasingly stringent environmental regulations and other permitting restrictions, or the availability of essential supplies and services; and factors beyond the capacity of the Company to anticipate and control, such as the marketability of minerals, government regulations relating to health, safety and the environment, and the scale and scope of royalties and taxes on production. Should one or more of these risks or uncertainties materialize, actual results may vary materially from those described in forward-looking statements.
Accordingly, readers are advised not to place undue reliance on forward-looking information. Except as required under applicable securities legislation, the Company undertakes no obligation to publicly update or revise forward-looking information, whether because of new information, future events or otherwise.
Description of Business
Newfoundland Discovery Corp. (the "Company" or "Newfoundland Discovery") is a junior exploration company incorporated under the laws of the Province of British Columbia, Canada and whose common shares are listed on the Canadian Securities Exchange. Its principal business is the exploration for minerals and the development of its gold projects located in Newfoundland and Labrador, Quebec, and British Columbia, Canada. Newfoundland Discovery is in the exploration stage and has not yet determined whether these properties contain mineral reserves that are economically recoverable.
The following discussion and analysis of the operations, results and financial position of Newfoundland Discovery should be read in conjunction with the condensed consolidated interim financial statements as of and for the period ended January 31, 2026 and the notes and schedules
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thereto (the "financial statements"). The financial statements are incorporated herein by reference.
The financial statements have been prepared in accordance with IFRS Accounting Standards ("IFRS") and unless otherwise cited, references to dollar amounts are Canadian dollars. The financial statements were prepared on a going concern basis, which presumes the realization of assets and the discharge of liabilities in the normal course of business for the foreseeable future. The Company had working capital deficiency of $672,362 as of January 31, 2025 and has accumulated losses of $32,434,242 since incorporation. The Company's ability to meet its obligations and maintain its operations is contingent upon additional financing or profitable operations in the future.
Discussion of Operations
Nine months ended January 31, 2026 and 2025
During the nine months ended January 31, 2026, the Company incurred a loss of $224,379 (2025 - $277,523). The lower net loss and comprehensive loss during January 31, 2026 was due to the gain on sales of exploration and evaluations assets of $25,000 for the Valentine Mountain Property.
Three months ended January 31, 2026 and 2025
During the three months ended January 31, 2026, the Company incurred a loss of $72,871 (2025 - $89,672). The lower net loss and comprehensive loss during January 31, 2026 was due to the lower management fees during the current period.
General
As of January 31, 2026, the Company had no contractual obligations, such as long-term debt, capital lease obligations, operating leases or purchase obligations, except as described in the financial statements, nor did it have commitments for capital expenditures. Refer to note 12 to the financial statements.
In general, gold prices are historically strong and equity markets remain positive. Many analysts expect gold prices to remain stable or strengthen, so the Company plans to further explore its core portfolio of mineral properties as funds permit, while still carefully managing its operating expenses.
Cash Flow
As of January 31, 2026, the Company had cash of $26,135 as compared with cash of $25,815 at the beginning of the financial year, an increase of $320. During the period, the Company used $320 of cash for its operations.
Summary of Quarterly Results
| 2026 Q3 | 2026 Q2 | 2026 Q1 | 2025 Q1 | 2025 Q4 | 2025 Q3 | 2025 Q2 | 2024 Q1 | |
|---|---|---|---|---|---|---|---|---|
| Revenue | $ - | $ - | $ - | $ - | $ - | $ - | $ - | $ - |
| Loss for the period | (72,871) | (65,649) | (85,859) | (85,859) | (700,330) | (100,273) | (89,672) | (87,587) |
| Loss per share | (0.01) | (0.01) | (0.01) | (0.01) | (0.08) | (0.01) | (0.01) | (0.01) |
| Total comprehensive loss | (72,871) | (65,649) | (85,859) | (85,859) | (700,330) | (100,273) | (89,672) | (87,587) |
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Variations in loss from quarter to quarter typically result from increases or decreases in exploration and business activity. During periods of greater activity consulting fees, investor relations expense, office and administrative costs, and regulatory approval costs will typically increase.
During the fourth quarter of 2025, the Company recorded a $579,779 impairment of exploration and evaluation assets.
The differences between loss for the period and total comprehensive loss are the result of non-cash unrealized gains and losses on investments and reclassification to profit and loss upon realization.
The quarterly results summarized herein were prepared in accordance with IFRS and are expressed in Canadian dollars.
Liquidity and Capital Resources
The Company does not yet generate positive cash flow from operations and is therefore reliant upon the issuance of its own common shares to fund its operations.
As of the January 31, 2026, the Company was not adequately funded. Mineral exploration is capital intensive, and to carry out its exploration plans the Company must liquidate investments or raise additional equity capital, though there is no certainty that such financings will be completed.
The Company is presently unable to meet all of its ongoing financial obligations as they become due. It has no debt obligations and no commitments other than as described herein and in its financial statements.
Exploration Properties
Valentine Mountain Property
In 2008 and 2009, the Company acquired a 100% interest in 25 mineral claims comprising approximately 7,188 hectares and two overlying placer claims comprising 43 hectares on Valentine Mountain located 50 kilometres west northwest of Victoria, British Columbia, Canada for total consideration of $39,158 and 2,917 common shares of the Company valued at $270,000. One of the claims is subject to a 5% net smelter returns royalty, which the Company may repurchase for $1,000,000.
During the year ended April 30, 2024, the Company recognized an impairment of $1,593,129, leaving a nominal value of $1.
During the year ended April 30, 2025, the Company incurred $1,200 on the claims and recognized an impairment of $1,201.
During the period ended January 31, 2026, the Company entered into a letter of intent with an arm's length company whereby the company has an option proceed with a definitive agreement to acquire a 100% interest in the property for the following consideration:
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i) $25,000 upon execution of the letter of intent (paid)
ii) $150,000 within 30 days of signing the definitive agreement.
iii) issuance of common shares of $150,000 or $150,000 cash within 90 days of signing the definitive agreement.
The Company incurred $400 on the claims during the period ended January 31, 2026, which was recognized as recovery and netted to the proceeds of $25,000, which resulted in a gain on sales of exploration and evaluation property of $24,600.
The Company is currently in negotiation with the arm's length party to determine the acceptance of the letter.
Transactions Between Related Parties
Key management personnel are those persons responsible for planning, directing and controlling the activities of an entity, and include executive and non-executive directors. The Company has identified its directors, Chief Executive Officer, and Chief Financial Officer as its key management personnel and has determined the companies they control to be management entities. The compensation costs for key management personnel for the nine-month periods ended January 31, 2026 and 2025 are as follows:
| 2026 | 2025 | |
|---|---|---|
| Management fees paid to a corporation controlled by the Company's Chief Executive Officer | $ 90,000 | $ 90,000 |
| Rent paid to a corporation controlled by the Company's Chief Executive Officer | 16,200 | 24,000 |
| Management fees paid to a director | 18,000 | 18,000 |
| Management fees paid to the Company's Chief Financial Officer | 6,000 | - |
| Management fees paid to a corporation controlled by the Company's Chief Financial Officer | 18,400 | 30,000 |
| $ 148,600 | $ 162,000 |
As at January 31, 2026, $278,820 (April 30, 2025 - $176,100) was due to key management personnel and management entities and is included in accounts payable and accrued liabilities on the Consolidated Statements of Financial Position.
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Financial Instruments and Other Instruments
The Company's financial instruments consist of cash, reclamation bonds, and accounts payable and accrued liabilities. The Company's financial instruments are exposed to certain financial risks, including credit risk, liquidity risk and market risk. There have not been any material changes in the exposure to these risks or the Company's objectives, policies, and processes for managing the risk.
Credit Risk
Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. The Company's maximum exposure to credit risk is the carrying value of its financial assets, which comprise cash and reclamation bonds held with high creditworthy financial institutions, and which total $39,135 (April 30, 2025 – $38,815). In the opinion of management, none of the Company's financial assets were exposed to significant credit risk as at January 31, 2026 and April 30, 2025.
Liquidity Risk
Liquidity risk is the risk that the Company will encounter difficulty in satisfying financial obligations as they become due. The Company manages its liquidity risk by forecasting cash flows required by operations and anticipated investing and financing activities. The Company had cash at January 31, 2026 in the amount of $26,135 (April 30, 2025 – $25,815) in order to meet short-term business requirements. At January 31, 2026, the Company had current liabilities of $708,633 (April 30, 2025 – $482,712). Accounts payable have contractual maturities of approximately 30 days or are due on demand and are subject to normal trade terms, and amounts due to related parties are without stated terms of interest or repayment.
Market Risk
Market risk consists of interest rate risk, foreign currency risk and other price risk. These are discussed further below.
Interest Rate Risk
Interest rate risk has two components:
a) To the extent that payments made or received on the Company's monetary assets and liabilities are affected by changes in the prevailing market interest rates, the Company is exposed to interest rate cash flow risk.
b) To the extent that changes in prevailing market rates differ from the interest rate in the Company's monetary assets and liabilities, the Company is exposed to interest rate price risk.
The Company's cash is currently held on deposit at a major bank. Management considers the interest rate risk to be minimal.
Foreign Currency Risk
Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate due to changes in foreign exchange rates. The Company is not exposed to material foreign currency risk.
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Other Price Risk
Other price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate due to changes in market prices, other than those arising from interest rate risk or foreign currency risk. The Company is exposed to other price risk with respect to its investments as they are carried at fair value based on quoted market prices.
Critical Accounting Estimates
Please refer to the condensed interim consolidated financial statements for the period ended January 31, 2026 on www.sedarplus.ca for critical accounting estimates.
New Accounting Policies And Pronouncements
Please refer to the condensed interim consolidated financial statements for the period ended January 31, 2026 on www.sedarplus.ca for new accounting policies as well as future accounting pronouncements.
Outstanding Share Data
As at the date hereof, the Company has 13,922,647 common shares issued and outstanding.
Warrants
| Exercise Price | Expiry Date | Outstanding |
|---|---|---|
| $0.12 | March 13, 2030 | 4,600,000 |
Other Information
Additional information relating to the Company is available from the Company's website at https://newfoundlanddiscovery.ca and on SEDAR PLUS at www.sedarplus.ca.