Quest Water Global Narrows Loss, Faces Going Concern Doubts Amid DRC Deal

TL;DR

**QWTR is a highly speculative bet, as a new $30M DRC deal offers potential upside but is overshadowed by severe financial distress and going concern warnings.**

AI Summary

Quest Water Global, Inc. (QWTR) reported a net loss of $339,494 for the six months ended June 30, 2025, a 28.18% improvement from the $472,725 net loss in the same period of 2024. The company's total assets significantly increased to $72,343 as of June 30, 2025, from $1,533 at December 31, 2024, primarily due to a new 'Due from related company' balance of $66,726. Total liabilities also rose to $2,816,997 from $2,406,693, with 'Due to related parties' increasing by $437,894 to $2,738,847. The company continues to operate with a working capital deficiency of $2,744,654 and an accumulated deficit of $12,932,490, raising substantial doubt about its ability to continue as a going concern. A significant strategic development occurred subsequent to the quarter, with QWTR entering a public-private partnership with the National Office for Rural Hydraulics (ONHR) in the Democratic Republic of Congo (DRC) to install 300 AQUAtap community water centers over five years, requiring a $30,000,000 contribution from QWTR over a 10-year term.

Why It Matters

For investors, QWTR's persistent working capital deficiency of $2,744,654 and accumulated deficit of $12,932,490 signal high financial risk, despite a reduced net loss. The new $30,000,000 partnership in the DRC, while a significant strategic move into a competitive water technology market, introduces substantial capital requirements and execution risk. Employees and customers in the DRC could benefit from improved water infrastructure, but the company's financial instability could jeopardize project completion. The broader market will watch if QWTR can secure the necessary financing to capitalize on this large-scale project and compete with established water solution providers.

Risk Assessment

Risk Level: high — The company explicitly states a 'working capital deficiency of $2,744,654' and an 'accumulated deficit of $12,932,490' as of June 30, 2025. These factors 'raise substantial doubt regarding the Company's ability to continue as a going concern,' indicating severe financial instability and a high risk of business failure without significant external funding.

Analyst Insight

Investors should exercise extreme caution and consider this a highly speculative investment. Given the explicit 'going concern' warning and substantial capital requirements for the new DRC partnership, potential investors should wait for clear evidence of successful financing and operational execution before considering a position.

Financial Highlights

debt To Equity

N/A

revenue

$0

operating Margin

N/A

total Assets

$72,343

total Debt

$2,816,997

net Income

-$339,494

eps

N/A

gross Margin

N/A

cash Position

$66

revenue Growth

N/A

Executive Compensation

Key Numbers

• $339,494 — Net loss for six months ended June 30, 2025 (28.18% improvement from $472,725 loss in prior year)
• $72,343 — Total assets as of June 30, 2025 (Significant increase from $1,533 at December 31, 2024)
• $2,744,654 — Working capital deficiency as of June 30, 2025 (Indicates severe liquidity issues and going concern risk)
• $12,932,490 — Accumulated deficit as of June 30, 2025 (Reflects historical losses and contributes to going concern doubt)
• $30,000,000 — Company's required contribution to DRC partnership (Over 10 years for 300 AQUAtap systems)
• 131,903,029 — Common shares outstanding (Consistent across periods, impacting per-share metrics)
• $2,738,847 — Due to related parties as of June 30, 2025 (Increased from $2,300,953, representing 97.2% of total liabilities)
• $66,726 — Due from related company (AQUAtap) as of June 30, 2025 (New balance, contributing to asset increase)
• $247,500 — Management fees incurred for six months ended June 30, 2025 (Paid to President and Vice President, consistent with prior year)

Key Players & Entities

• Quest Water Global, Inc. (company) — registrant
• National Office for Rural Hydraulics (company) — DRC public-private partnership partner
• Democratic Republic of Congo (regulator) — location of new partnership
• Yonga Industries (Pty) Ltd. (company) — South African partnership entity
• Yorown Energy (Pty) Ltd. (company) — South African partnership entity
• AQUAtap Oasis South Africa (Pty) Ltd. (company) — joint venture in South Africa
• AQUAtap Oasis Partnership S.A.R.L. (company) — related company in Democratic Republic of Congo
• President of the Company (person) — related party owed $1,421,071
• Vice President of the Company (person) — related party owed $1,317,776

FAQ

Risk Factors

• Going Concern Uncertainty [high — financial]: The company has an accumulated deficit of $12,932,490 and a working capital deficiency of $2,744,654 as of June 30, 2025. This raises substantial doubt about its ability to continue as a going concern.
• Significant Related Party Balances [high — financial]: Total liabilities are $2,816,997, with 'Due to related parties' accounting for $2,738,847 (97.2% of total liabilities). This heavy reliance on related party financing presents a significant financial risk.
• Dependence on Large Partnership [high — operational]: The company's future is heavily tied to a $30,000,000 commitment over 10 years for a public-private partnership in the DRC. Any disruption or failure in this partnership could severely impact the company.
• Asset Concentration in Related Party Receivable [medium — financial]: Total assets increased to $72,343 from $1,533, primarily due to a new 'Due from related company' balance of $66,726. This concentration makes the company vulnerable to the financial health of this related entity.
• Historical Losses [medium — operational]: The company has consistently reported net losses, accumulating to $12,932,490 as of June 30, 2025. This indicates a long-term struggle to achieve profitability.

Industry Context

The water infrastructure sector, particularly in developing regions like the DRC, presents significant opportunities driven by unmet needs. However, it also involves complex project execution, substantial capital requirements, and reliance on government or international partnerships. Companies in this space often face challenges related to funding, regulatory hurdles, and geopolitical stability.

Regulatory Implications

The company's operations in the DRC are subject to local regulations and compliance requirements. The success of the public-private partnership hinges on adherence to contractual obligations and governmental policies. Any changes in DRC's regulatory environment or political stability could impact the project's feasibility and the company's investment.

What Investors Should Do

1. Monitor the execution and financial performance of the DRC partnership closely.
2. Assess the company's ability to secure additional funding beyond related party balances.
3. Evaluate the financial stability and commitment of the related parties providing financing.
4. Scrutinize the terms and conditions of the ONHR partnership for potential risks and contingencies.

Key Dates

• 2025-06-30: Six months ended June 30, 2025 — Reported a net loss of $339,494, an improvement from the prior year, but still reflects ongoing financial challenges. Total assets increased significantly due to related party balances.
• 2024-12-31: As of December 31, 2024 — Total assets were minimal at $1,533, with liabilities of $2,406,693, indicating a pre-existing financial strain.
• Subsequent to June 30, 2025: Public-private partnership with ONHR in DRC — A major strategic development involving a $30,000,000 commitment over 10 years, which is critical for future operations but also introduces significant financial obligations and execution risk.

Glossary

Accumulated deficit

The total net losses of a company over its lifetime that have not been offset by net income. (Indicates the company's history of unprofitability, contributing to going concern doubts.)

Working capital deficiency

Occurs when a company's current liabilities exceed its current assets, indicating a short-term inability to meet obligations. (Highlights immediate liquidity issues and a significant risk to the company's ability to operate.)

Due from related company

An amount owed to the company by an entity that has a close relationship with the company (e.g., parent, subsidiary, or common control). (Represents a significant portion of the company's assets, making its financial health dependent on this related entity.)

Due to related parties

An amount owed by the company to entities with which it has a close relationship. (Constitutes the vast majority of the company's liabilities, showing heavy reliance on financing from related entities.)

Going concern

The assumption that a business will continue to operate for the foreseeable future. (The company's financial condition raises substantial doubt about its ability to continue as a going concern.)

Year-Over-Year Comparison

For the six months ended June 30, 2025, Quest Water Global reported a net loss of $339,494, which is a 28.18% improvement compared to the $472,725 net loss in the same period of 2024. Total assets saw a dramatic increase to $72,343 from $1,533, largely due to a new 'Due from related company' balance. However, total liabilities also grew to $2,816,997 from $2,406,693, primarily driven by an increase in 'Due to related parties'. The company continues to face significant financial challenges, including a substantial working capital deficiency and accumulated deficit, raising going concern doubts.

Key Financial Figures

• $30,000,000 — Company is responsible for contributing $30,000,000 to the partnership over the anticipated

Filing Documents

• form10-q.htm (10-Q) — 385KB
• ex31-1.htm (EX-31.1) — 18KB
• ex31-2.htm (EX-31.2) — 18KB
• ex32-1.htm (EX-32.1) — 6KB
• ex32-2.htm (EX-32.2) — 7KB
• 0001493152-25-013354.txt ( ) — 2126KB
• qwtr-20250630.xsd (EX-101.SCH) — 19KB
• qwtr-20250630_cal.xml (EX-101.CAL) — 29KB
• qwtr-20250630_def.xml (EX-101.DEF) — 53KB
• qwtr-20250630_lab.xml (EX-101.LAB) — 159KB
• qwtr-20250630_pre.xml (EX-101.PRE) — 122KB
• form10-q_htm.xml (XML) — 194KB

Financial Statements

Item 1. Financial Statements F-1

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 4

Quantitative and Qualitative Disclosures about Market Risk

Item 3. Quantitative and Qualitative Disclosures about Market Risk 9

Controls and Procedures

Item 4. Controls and Procedures 9

– OTHER INFORMATION

PART II – OTHER INFORMATION

Legal Proceedings

Item 1. Legal Proceedings 10

Risk Factors

Item 1A. Risk Factors 10

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 10

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 10

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 10

Other Information

Item 5. Other Information 10

Exhibits

Item 6. Exhibits 11 2

Financial Statements

Item 1. Financial Statements QUEST WATER GLOBAL, INC. CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED JUNE 30, 2025 AND 2024 (EXPRESSED IN US DOLLARS) (Unaudited) Index Condensed Consolidated Interim Balance Sheets F-2 Condensed Consolidated Interim Statements of Operations and Comprehensive Loss F-3 Condensed Consolidated Interim Statements of Stockholders' Deficit F-4 Condensed Consolidated Interim Statements of Cash Flows F-5 Notes to the Condensed Consolidated Interim Financial Statements F-6 F-1 QUEST WATER GLOBAL, INC. Condensed Consolidated Interim Balance Sheets (Expressed in US Dollars) June 30, December 31, 2025 2024 (Unaudited) (Audited) ASSETS Current assets Cash $ 66 $ 4 Prepaid expenses 5,551 1,362 Total current assets 5,617 1,366 Equipment, net (Note 4) - 167 Due from related company (Note 3) 66,726 - Total assets $ 72,343 $ 1,533 LIABILITIES AND STOCKHOLDERS' DEFICIT Current liabilities Accounts payable and accrued liabilities $ 78,150 $ 85,176 Due to related company (Note 3) - 20,564 Due to related parties (Note 5) 2,738,847 2,300,953 Due to related parties (Note 5) 2,738,847 2,300,953 Total liabilities 2,816,997 2,406,693 Commitments and Contingencies - - Stockholders' deficit Preferred stock, 5,000,000 shares authorized, $ 0.000001 par value 2 shares issued and outstanding 1 1 Common stock, 500,000,000 shares authorized, $ 0.000001 par value 131,903,029 issued and outstanding (December 31, 2024 – 131,903,029 ) 132 132 Additional paid-in capital 10,187,703 10,187,703 Deficit ( 12,932,490 ) ( 12,592,996 ) Total stockholders' deficit ( 2,744,654 ) ( 2,405,160 ) Total liabilities and stockholders' deficit $ 72,343 $ 1,533 (The accompanying notes are an integral part of these condensed consolidated financial statements) F-2 QUEST WATER GLOBAL, INC. Condensed Consolidated Interim Statements of

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View this 10-Q filing on SEC EDGAR