QZMRF Losses Widen 42% Amid Increased Exploration, No Revenue

TL;DR

**QZMRF is burning cash at an accelerating rate with no revenue in sight; this is a high-risk bet on a future discovery, not a stable investment.**

AI Summary

QUARTZ MOUNTAIN RESOURCES LTD. (QZMRF) reported a significant increase in its net loss for the fiscal year ended July 31, 2025, reaching $3,473,539, a 42.5% increase from the $2,436,802 loss in 2024. Operating expenses also surged to $3,560,819 in 2025, up from $2,542,646 in 2024, reflecting increased exploration activities. The company continues to generate no sales revenue, underscoring its pre-revenue exploration stage. Despite the losses, working capital improved substantially to $2,881,768 in 2025 from $1,694,797 in 2024, and total assets grew to $4,194,982 from $3,014,035. Shareholder's deficiency deepened to $(3,910,539) in 2025 from $(2,680,994) in 2024, while share capital increased to $37,607,312, indicating new equity financing. The company issued 10,780,000 common shares, bringing the total outstanding to 69,648,030 as of July 31, 2025. Key risks include the need for additional funding, the highly speculative nature of resource exploration, and the absence of any economic mineral deposits found to date.

Why It Matters

QUARTZ MOUNTAIN RESOURCES LTD.'s deepening losses and continued reliance on equity financing highlight the inherent risks of early-stage mineral exploration. For investors, this means significant dilution risk, as evidenced by the issuance of 10,780,000 new shares in 2025, and a long path to potential profitability, if ever. Employees and customers are less directly impacted given the company's pre-revenue status, but the broader market for junior mining companies will watch QZMRF as a bellwether for speculative resource plays. The company's ability to secure future funding in a competitive capital market will be critical to its survival and any potential for discovery.

Risk Assessment

Risk Level: high — The risk level is high due to the company's explicit 'Going Concern Assumption' disclosure, stating that 'unless additional funding is obtained, this assumption will have to change.' QZMRF has incurred increasing losses since inception, with a loss of $3,473,539 in 2025, and has no history of mining operations or earnings, generating $0 in sales revenue. The company also states it 'currently does not have sufficient funds to explore the properties it holds,' indicating immediate and significant funding risk.

Analyst Insight

Investors should exercise extreme caution and consider this a highly speculative investment. Given the increasing losses and explicit need for additional funding, potential investors should wait for concrete evidence of economic mineral deposits and a clear path to commercial production before considering an investment.

Financial Highlights

debt To Equity

N/A

revenue

$0

operating Margin

N/A

total Assets

$4,194,982

total Debt

N/A

net Income

-$3,473,539

eps

-$0.06

gross Margin

N/A

cash Position

$2,881,768

revenue Growth

N/A

Revenue Breakdown

Key Numbers

• $3,473,539 — Loss and comprehensive loss (Increased from $2,436,802 in 2024, a 42.5% increase)
• $3,560,819 — Loss from operating expenses (Increased from $2,542,646 in 2024)
• $0 — Sales revenue (No revenue generated for the fiscal year ended July 31, 2025)
• $2,881,768 — Working capital (Increased from $1,694,797 in 2024)
• $4,194,982 — Total assets (Increased from $3,014,035 in 2024)
• $(3,910,539) — Shareholder's deficiency (Deepened from $(2,680,994) in 2024)
• 69,648,030 — Common shares outstanding (As of July 31, 2025, up from 58,868,030 in 2024)
• $0.06 — Basic loss per common share (Increased from $0.05 in 2024)
• $37,607,312 — Share capital (Increased from $33,312,270 in 2024, indicating new equity financing)
• 1.4034 — Canadian dollars per US dollar (Exchange rate on November 27, 2025)

Key Players & Entities

• QUARTZ MOUNTAIN RESOURCES LTD. (company) — Registrant
• Sebastian Tang (person) — Chief Financial Officer
• DeVisser Gray LLP (company) — Independent Registered Public Accountants
• SEC (regulator) — Securities and Exchange Commission
• IASB (regulator) — International Accounting Standards Board
• Bank of Canada (regulator) — Publisher of exchange rates
• British Columbia (company) — Jurisdiction of incorporation
• Vancouver (company) — Location of principal executive offices

FAQ

Risk Factors

• Need for Additional Funding [high — financial]: The company's net loss increased by 42.5% to $3,473,539 in fiscal year 2025, with operating expenses surging to $3,560,819. This indicates a significant ongoing need for capital to fund exploration activities and cover operational costs, as no revenue is being generated.
• Speculative Nature of Resource Exploration [high — operational]: Quartz Mountain Resources Ltd. is engaged in highly speculative resource exploration. To date, no economic mineral deposits have been found. The success of the company is entirely dependent on discovering commercially viable deposits, which carries a high degree of uncertainty and risk.
• Deepening Shareholder's Deficiency [medium — financial]: The shareholder's deficiency has deepened to $(3,910,539) in 2025 from $(2,680,994) in 2024. This, combined with the increasing net loss, highlights the financial strain and the dilutive effect of potential future equity financings.
• Permitting and Land Use Uncertainty [medium — regulatory]: The company's projects require all necessary environmental and other permits, as well as land use and other licenses. Delays or failure to obtain these, or opposition from Aboriginal groups regarding asserted rights and title, could significantly impact exploration and development plans.
• Commodity Price Volatility [medium — market]: As a resource exploration company, Quartz Mountain is indirectly exposed to fluctuations in commodity prices. While not directly generating revenue, the potential future value of any discovered deposits is heavily influenced by global commodity market dynamics.

Industry Context

Quartz Mountain Resources Ltd. operates in the highly competitive and speculative junior mining and exploration sector. This industry is characterized by significant capital requirements, long lead times for discovery and development, and inherent geological and market risks. Success is contingent on identifying economically viable mineral deposits and navigating complex regulatory environments, often facing competition from larger, more established players with greater financial resources.

Regulatory Implications

As a foreign private issuer filing a Form 20-F, Quartz Mountain Resources Ltd. is subject to SEC regulations in the U.S. and potentially securities regulations in its home jurisdiction (likely Canada, given the currency references). Compliance with reporting standards, disclosure requirements, and any applicable mining and environmental regulations in the jurisdictions where it operates are critical.

What Investors Should Do

1. Monitor future financing rounds closely, as the company's continued operations and exploration success are heavily dependent on its ability to raise capital, which may lead to further share dilution.
2. Evaluate the company's exploration progress and geological reports rigorously, given the absence of any economic deposits found to date and the speculative nature of the business.
3. Assess the company's cash burn rate against its current working capital of $2,881,768 to understand its runway for future exploration activities.
4. Understand the significant shareholder's deficiency of $(3,910,539) and its implications for the company's long-term financial stability and potential for future equity raises.

Glossary

20-F

An annual report required by the U.S. Securities and Exchange Commission (SEC) for foreign private issuers, providing a comprehensive overview of the company's business and financial condition. (This document is the primary source of information for investors regarding Quartz Mountain Resources Ltd.'s financial performance and strategic outlook.)

Shareholder's deficiency

A situation where a company's total liabilities exceed its total assets, resulting in a negative net worth for shareholders. (Indicates the company's current financial health and the extent to which its assets would be insufficient to cover its obligations to shareholders if liquidated.)

Working capital

The difference between a company's current assets and current liabilities, representing its short-term financial health and operational liquidity. (An increase in working capital to $2,881,768 suggests improved short-term liquidity, which is crucial for an exploration company funding its operations.)

Share capital

The total amount of capital raised by a company through the issuance of shares. (An increase in share capital to $37,607,312 signifies successful equity financing, likely to fund ongoing exploration activities.)

Pre-revenue exploration stage

A phase in a resource company's lifecycle where it is actively exploring for minerals or other resources but has not yet commenced commercial production or generated any sales revenue. (Explains why Quartz Mountain Resources Ltd. has no sales revenue and incurs losses, highlighting the speculative nature of its business model.)

Year-Over-Year Comparison

Compared to the previous fiscal year, Quartz Mountain Resources Ltd. has seen a significant increase in its net loss, up 42.5% to $3,473,539, driven by a surge in operating expenses to $3,560,819 due to increased exploration. While revenue remains at $0, working capital has improved substantially to $2,881,768, and total assets have grown to $4,194,982, indicating successful equity financing that also led to a deeper shareholder's deficiency of $(3,910,539).

Key Financial Figures

• $1 — published by the Bank of Canada, was US$1 = Canadian $1.4034. The following tabl
• $1.4034 — the Bank of Canada, was US$1 = Canadian $1.4034. The following tables set out the exch

Filing Documents

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• qzm_ex121.htm (EX-12.1) — 10KB
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Item 18

Item 17 Item 18 If this is an annual report, indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes No GENERAL 4 CURRENCY AND MEASUREMENT 5 NOTE ON FORWARD LOOKING STATEMENTS 5 ITEM 1 IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS 5 ITEM 2 OFFER STATISTICS AND EXPECTED TIMETABLE 6 ITEM 3 KEY INFORMATION 6 A.

SELECTED FINANCIAL DATA

SELECTED FINANCIAL DATA 6 B. CAPITALIZATION AND INDEBTEDNESS 7 C. REASONS FOR THE OFFER AND USE OF PROCEEDS 7 D.

RISK FACTORS

RISK FACTORS 7 ITEM 4 INFORMATION ON THE COMPANY 13 A. HISTORY AND DEVELOPMENT OF THE COMPANY 13 B. BUSINESS OVERVIEW 13 C. MINERAL PROPERTIES AND EXPLORATION ACTIVITIES AND PLANS 15 D. ORGANIZATIONAL STRUCTURE 30 E. PROPERTY, PLANT AND EQUIPMENT 30 F. CURRENCY 30 ITEM 4A UNRESOLVED STAFF COMMENTS 30 ITEM 5 OPERATING AND FINANCIAL REVIEW AND PROSPECTS 30 OVERVIEW 30 A. OPERATING RESULTS 31 B. LIQUIDITY AND CAPITAL RESOURCES 32 C. RESEARCH EXPENDITURES 33 D. TREND INFORMATION 33 E. OFF – BALANCE SHEET ARRANGEMENTS 33 F. TABULAR DISCLOSURE OF CONTRACTUAL OBLIGATIONS 33 G. SAFE HARBOR 34 ITEM 6 DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES 34 A. DIRECTORS AND SENIOR MANAGEMENT 34 B. COMPENSATION 36 C. BOARD PRACTICES 37 D. EMPLOYEES 40 E. SHARE OWNERSHIP 40 ITEM 7 MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS 41 A. MAJOR SHAREHOLDERS 41 B. RELATED PARTY TRANSACTIONS 42 C. INTERESTS OF EXPERTS AND COUNSEL 43 ITEM 8 FINANCIAL INFORMATION 44 A. CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION 44 B. SIGNIFICANT CHANGES 44 ITEM 9 THE OFFER AND LISTING 44 A. OFFER AND LISTING DETAILS 44 B. PLAN OF DISTRIBUTION 45 C. MARKETS 45 D. SELLING SHAREHOLDERS 45 E.

DILUTION

DILUTION 45 F. EXPENSES OF THE ISSUE 45 2 Table of Contents ITEM 10 ADDITIONAL INFORMATION 46 A. SHARE CAPITAL 46 B. MEMORANDUM AND ARTICLES OF ASSOCIATION 46 C. MATERIAL CONTRACTS 48 D. EXCHANGE CONTROLS 48 E. TAXATION 48 F. DIVIDENDS AND PAYING AGENTS 56 G. 57 H. DOCUMENTS ON DISPLAY 57 I. SUBSIDIARY INFORMATION 57 ITEM 11

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 57 A. TRANSACTION RISK AND CURRENCY RISK MANAGEMENT 57 B. EXCHANGE RATE SENSITIVITY 57 C. INTEREST RATE RISK AND EQUITY PRICE RISK 57 D. COMMODITY PRICE RISK 57 ITEM 12

DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES 57 ITEM 13 DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES 57 ITEM 14 MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS 58 ITEM 15

CONTROLS AND PROCEDURES

CONTROLS AND PROCEDURES 58 A. DISCLOSURE CONTROLS AND PROCEDURES 58 B. MANAGEMENT'S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING 58 CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING 58 LIMITATIONS OF CONTROLS AND PROCEDURES 59 ITEM 16 [RESERVED] 59 ITEM 16A AUDIT COMMITTEE FINANCIAL EXPERT 59 ITEM 16B CODE OF ETHICS 59 ITEM 16C PRINCIPAL ACCOUNTANT FEES AND SERVICES 60 ITEM 16D EXEMPTIONS FROM LISTING STANDARDS FOR AUDIT COMMITTEES 60 ITEM 16E PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS 60 ITEM 16F CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT 60 ITEM 16G CORPORATE GOVERNANCE 60 ITEM 16H MINE SAFETY DISCLOSURE 61 ITEM 17

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS 61 ITEM 18

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS 61 ITEM 19 EXHIBITS 61 3 Table of Contents GENERAL In this Annual Report on Form 20-F, all references to "we", the "Company", or "Quartz Mountain" refer to Quartz Mountain Resources Ltd. and its consolidated subsidiaries. The Company uses the Canadian dollar as its reporting currency. All references in this document to "dollars" or "

IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

ITEM 1 IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS Not applicable for an annual report. 5 Table of Contents

OFFER STATISTICS AND EXPECTED TIMETABLE

ITEM 2 OFFER STATISTICS AND EXPECTED TIMETABLE Not applicable for an annual report.

KEY INFORMATION

ITEM 3 KEY INFORMATION A. SELECTED FINANCIAL DATA The following tables summarize selected financial data for the Company (stated in Canadian dollars) prepared, in respect of the years ended July 31, 2025 and July 31, 2024, in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") ("IFRS-IASB"). As permitted by SEC Release No. 33-8879 "Acceptance from Foreign Private Issuers of Financial Statements Prepared in Accordance with International Reporting Standards without Reconciliation to U.S. GAAP", the Company includes selected financial data prepared in compliance with IFRS-IASB without reconciliation to U.S. GAAP. The selected financial data of the Company for the fiscal years presented was derived from the consolidated financial statements of the Company that have been audited by DeVisser Gray LLP, independent Registered Public Accountants, as indicated in their audit report which is included at Exhibit 99.1 in this Annual Report. The auditors conducted their audits in accordance with United States and Canadian generally accepted auditing standards, and the standards of the Public Company Accounting Oversight Board (United States). Year ended July 31, 2025 Year ended July 31, 2024 Year ended July 31, 2023 Year ended July 31, 2022 Year ended July 31, 2021 Sales revenue $ – $ – $ – $ – $ – Loss from operating expenses $ 3,560,819 $ 2,542,646 $ 927,916 $ 1,132,515 $ 254,168 Loss (income) and comprehensive loss (income) $ 3,473,539 $ 2,436,802 $ 910,427 $ 995,066 $ 116,419 Basic loss (earnings) per common share $ 0.06 $ 0.05 $ 0.02 $ 0.03 $ 0.00 Diluted loss (earnings) per common share $ 0.06 $ 0.05 $ 0.02 $ 0.02 $ 0.00 Dividends per share $ - $ - $ – $ – $ – Working capital $ 2,881,768 $ 1,694,797 $ 71,389 $ 40,912 $ 117,847 Total assets $ 4,194,982 $ 3,014,035 $ 863,601 $ 842,553 $

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