Enertopia Corp. 10-Q

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Forward-Looking Statements This quarterly report contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may", "should", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential" or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled "Risk Factors", that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results. Our unaudited condensed financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles. The following discussion should be read in conjunction with our unaudited condensed financial statements and the related notes that appear elsewhere in this quarterly report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this quarterly report, particularly in the section entitled "Risk Factors" of this quarterly report. In this quarterly report, unless otherwise specified, all dollar amounts are expressed in United States dollars. All references to "CDN$" refer to Canadian dollars and all references to "common shares" refer to the common shares in our capital stock. As used in this quarterly report, the terms "we", "us", "our" and "Company" mean Company and/or our subsidiaries, unless otherwise indicated. Overview Enertopia Corp. was formed on November 24, 2004 under the laws of the State of Nevada and commenced operations on November 24, 2004. Enertopia is focused on building shareholder value through a combination of our Nevada Lithium claims and intellectual property & patents in the green technology space. The address of our principal executive office is #7 1873 Spall Road, Kelowna, British Columbia V1Y 4R2. Our telephone number is (250) 870-2219. Our current location provides adequate office space for our purposes at this stage of our development. Due to the implementation of British Columbia Instrument 51-509 on September 30, 2008 by the British Columbia Securities Commission, we have been deemed to be a British Columbia based reporting issuer. As such, we are required to file certain information and documents at www.sedar.com. Our Current Business Enertopia is engaged in the business of Lithium exploration at their Nevada claims, along with holding intellectual property & non provisional pending patents in the green technology space. Mineral Property West Tonopah Lithium On February 25, 2022, the Company had 88 unpatented mineral lode claims in Esmeralda County, NV staked covering approximately 1,818 acres of land administrated by the BLM. The property is in good standing until September 3, 2024. Estimated respective yearly holding fees to the BLM $14,520 and $1,068 to Esmeralda County NV. Enertopia Claim name State or Federal Agency Claim number from Claim number to MS 1-88 BLM NV 105296951 NV 105297038 MS 1-88 Esmeralda County, NV 230856 230943 The Company completed its maiden drill program in June 2022 and a second phase drill program April 2023 and a 43-101 Technical Report November 2023. Further information can be found at www.enertopia.com. CLEAN TECHNOLOGY The company continues to test off-the-shelf technology under the potential for lower capex scenarios in lithium extraction. NON PROVISIONAL PATENTS On January 12, 2023 the Company announced the filing of Non provisional patent #4, known as the EMS filed November 2, 2022. The EMS is a battery monitoring technology that helps to increase the life and health of monitored battery packs. On May 23, 2022 the Company announced the filing of Non provisional patent #1, known as the Enertopia Solar Booster TM . The Enertopia Solar Booster captures heat from the solar panels, increasing PV output enhancing production and increasing the lifetime of the PV panels. On May 23, 2022 the Company announced the filing of Non provisional patent #2, known as Enertopia Heat Extractor TM Heat Extractor Technology can be used behind the PV panels or in a glazed format on their own to create liquid temperatures to 200 degrees F. On August 15, 2022 the Company announced the filing of Non provisional patent #3, known as Enertopia Rainmaker TM By cooling the backside of the PV panels below the dew point the atmospheric moisture condenses on the back side of the panel and drips as rain into the tray collecting the water. Summary The continuation of our business is dependent upon obtaining further financing, a successful program of development, and, finally, achieving a profitable level of operations. The issuance of additional equity securities by us could result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments. There are no assurances that we will be able to obtain further funds required for our continued operations. As noted herein, we are pursuing various financing alternatives to meet our immediate and long-term financial requirements. There can be no assurance that additional financing will be available to us when needed or, if available, that it can be obtained on commercially reasonable terms. If we are not able to obtain the additional financing on a timely basis, we will be unable to conduct our operations as planned, and we will not be able to meet our other obligations as they become due. In such event, we will be forced to scale down or perhaps even cease our operations. There is significant uncertainty as to whether we can obtain additional financing. Employees We primarily used the services of sub-contractors and consultants for our intended business operations. Our technical consultant is Mr. McAllister, our president, CEO and a director. On November 30, 2007, Mr. McAllister was appointed as our President and on April 14, 2008 he was appointed as a director. On May 1, 2022, the Company entered into a consulting agreement with President of the Company for $9,500 per month plus goods and services tax ("GST") on a continuing basis. The Company has a consulting agreement with the CFO of the Company Mr. Allan Spissinger for corporate administration and consulting services for $7,500 per quarter plus goods and services tax ("GST") on a continuing basis. We do not expect any material changes in the number of employees over the next 12-month period. We do and will continue to outsource contract employment as needed. Research and Development We have incurred $965,361 in research and development expenditures over the last two fiscal years and $88,300 during the three months ended November 30, 2023. Competition There is strong competition relating to all aspects of the resource sector. We actively compete for capital, skilled personnel, market share, and in all other aspects of our operations with a substantial number of other organizations. These organizations include small development stage companies like our own, and large, established companies, many of which have greater technical and financial resources than our company. Compliance with Government Regulation The exploration and development of mineral properties is subject to various United States federal, state and local and foreign governmental regulations. We may from time to time, be required to obtain licenses and permits from various governmental authorities in regards to the exploration of our property interests. Purchase of Significant Acquisition Not applicable Off-Balance Sheet Arrangements We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders. Critical Accounting Policies Our financial statements and accompanying notes are prepared in accordance with generally accepted accounting principles used in the United States of America. Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. These estimates and assumptions are affected by management's application of accounting policies. We believe that understanding the basis and nature of the estimates and assumptions involved with the following aspects of our financial statements is critical to an understanding of our financials. Mineral Properties Acquisition costs of mineral rights are initially capitalized as incurred while exploration and pre-extraction expenditures are expensed as incurred until such time proven or probable reserves are established for that project. Acquisition costs include cash consideration and the fair market value of shares issued on the acquisition of mineral properties. Expenditures relating to exploration activities are expensed as incurred and expenditures relating to pre-extraction activities are expensed as incurred until such time proven or probable reserves are established for that project, after which subsequent expenditures relating to development activities for that particular project are capitalized as incurred. Where proven and probable reserves have been established, the project's capitalized expenditures are depleted over proven and probable reserves using the units-of-production method upon commencement of production. Where proven and probable reserves have not been established, the project's capitalized expenditures are depleted over the estimated extraction life using the straight-line method upon commencement of extraction. The Company has not established proven or probable reserves for any of its projects. The carrying values of the mineral rights are assessed for impairment by management on a quarterly basis and as required whenever indicators of impairment exist. An impairment loss is recognized if it is determined that the carrying value is not recoverable and exceeds fair value. Long-Lived Assets Impairment In accordance with ASC 360, "Accounting for Impairment or Disposal of Long Lived Assets", the carrying value of long lived assets are tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. The Company recognizes impairment when the sum of the expected undiscounted future cash flows is less than the carrying amount of the asset. Impairment losses, if any, are measured as the excess of the carrying amount of the asset over its estimated fair value. Going Concern We have suffered recurring losses from operations. The continuation of our Company as a going concern is dependent upon our Company attaining and maintaining profitable operations and/or raising additional capital. The financial statements do not include any adjustment relating to the recovery and classification of recorded asset amounts or the amount and classification of liabilities that might be necessary should our Company discontinue operations. The continuation of our business is dependent upon us raising additional financial support and/or attaining and maintaining profitable levels of internally generated revenue. The issuance of additional equity securities by us could result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments. Results of Operations - Three Months Ended November 30, 2023 and November 30, 2022 The following summary of our results of operations should be read in conjunction with our financial statements for the quarter ended November 30, 2023, which are included herein. Our operating results for the three months ended November 30, 2023 and November 30, 2022 and the changes between those periods for the respective items are summarized as follows: Three Months Ended November 30, November 30, 2023 2022 Change Revenue $ - $ - $ - General and administrative 17,701 22,536 4,835 Investor relations 9,946 20,373 10,427 Consulting fees 48,211 64,494 16,283 Fees and dues 438 21,195 20,757 Exploration expenses 45,652 2,987 (42,665 ) Research and development 88,300 15,526 (72,774 ) Professional fees 41,123 31,249 (9,874 ) Other expenses 158,377 268,474 110,097 Net loss $ 409,748 $ 446,834 $ 37,086 Our financial statements report no revenue for the three months ended November 30, 2023, and November 30, 2022. Our financial statements report a net loss of $409,748 for the three-month period ended November 30, 2023, compared to a net loss of $446,834 for the three-month period ended November 30, 2022. Our net loss decreased by $37,086 for the three-month period ended November 30, 2023 primarily due to increases in R&D and exploration expenses offset by general cost containment measures and further offset by decreases in other expenses from changes in marketable securities. Other income consisted of non-cash unrealized gains of $183,690 and foreign exchange gain of $7,763 on marketable securities, unrealized foreign exchange loss of $1,406 and realized losses on disposition of $327,784 and realized foreign exchange loss of $20,640 on marketable securities. Our operating costs were higher by $73,011 for November 30, 2023, compared to November 30, 2022. The increase was primarily due to R&D costs for the period of $88,300. Liquidity and Financial Condition Working Capital November 30, August 31, 2023 2023 Current assets $ 923,198 $ 1,347,708 Current liabilities 317,838 332,600 Working capital $ 605,360 $ 1,015,108 As at November 30, 2023, we had $317,838 in current liabilities, which is lower by $14,762 when compared to current liabilities as at August 31, 2023. November 30, November 30, Cash Flows 2023 2022 Cash flows used in operating activities $ (229,950 ) $ (166,497 ) Cash flows from investing activities 218,555 - Net decrease in cash during year $ (11,395 ) $ (166,497 ) Operating Activities Net cash used in operating activities was $229,950 in the three-months ended November 30, 2023 compared with net cash used in operating activities of $166,497 in the same period in 2022. Investing Activities Net cash provided by investing activities was $218,555 and $0 in the three-months ended November 30, 2023 and 2022, respectively. Financing Activities The Company had no financing activities in the three months ended November 30, 2023 and 2022.