Quarterly Report for Quarter Ending September 30, 2026 (Form 10-Q)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

We use the terms "Magellan," "we," "our," and "us" to refer to Magellan Copper & Gold Corp.

The following discussion and analysis provide information that management believes is relevant for an assessment and understanding of our results of operations and financial condition. This information should be read in conjunction with our audited financial statements, which are included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, and our interim unaudited financial statements and notes thereto included with this report in Part I, Item 1.

Forward-Looking Statements

Some of the information presented in this Form 10-Q constitutes "forward-looking statements". These forward-looking statements include, but are not limited to, statements that include terms such as "may," "will," "intend," "anticipate," "estimate," "expect," "continue," "believe," "plan," or the like, as well as all statements that are not historical facts. Forward-looking statements are inherently subject to risks and uncertainties that could cause actual results to differ materially from current expectations. Although we believe our expectations are based on reasonable assumptions within the bounds of our knowledge of our business and operations, there can be no assurance that actual results will not differ materially from expectations.

All forward-looking statements speak only as of the date on which they are made. We undertake no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they are made.

Overview

We were incorporated on September 28, 2010, in Nevada. Our principal business is the acquisition and exploration of mineral resources. We have not presently determined whether the properties to which we have mineral rights contain mineral reserves that are economically recoverable.

We have only had limited operations to date, and we rely upon the sale of our securities and borrowings from significant investors to fund our operations, as we have not generated any revenue.

Our current focus is to advance the Ophir Creek Placer Gold Mine towards resource definition and eventual development. Secondarily, we may acquire additional mineral projects which could add earlier revenue to the Company. The Company is currently severely restrained by access to capital and any plans with respect to its existing or future projects are subject to availability of capital on reasonable terms. In the past, and for the foreseeable future, we will continue to rely upon the sale of our securities as well as advances and loans from executive management, and also from significant shareholders, to fund our operations as we do not generate consistent revenue. Prospective investors should note that there is no assurance that additional capital will be available to the Company to carry out its stated work plans.

Results of Operations for the three months ended September 30, 2026 and 2025

Operating expenses

During the three months ended September 30, 2026, our total operating expenses included general and administrative expenses of $51,355 as compared to $31,603 during the three months ended September 30, 2025. The $19,752 change was mainly related to an increase in professional and administrative fees.

Other income (expense)

During the three months ended September 30, 2026, total other income was $27,941 as compared to other expense of $121,674 during the three months ended September 30, 2025. The $149,615 change was mainly related to the change in derivative liability.

Results of Operations for the nine months ended September 30, 2026 and 2025

Operating expenses

During the nine months ended September 30, 2026, our total operating expenses included general and administrative and impairment expenses of $248,864 as compared to $136,653 during the nine months ended September 30, 2025. The $111,911 change was mainly related to the $25,000 impairment expense related to the Ophir Creek Placer Gold mineral rights and properties and an increase in professional and administrative fees.

Other expense

During the nine months ended September 30, 2026, total other expense was $182,089 as compared to other expense of $198,073 during the nine months ended September 30, 2025. The $15,984 change was mainly related to a loss on conversion of debt in the prior year.

Liquidity and Capital Resources

Our unaudited consolidated financial statements have been prepared on a going concern basis, which assumes that we will be able to meet our obligations and continue our operations during the next fiscal year. Asset realization values may be significantly different from carrying values as shown in our consolidated financial statements and do not give effect to adjustments that would be necessary to the carrying values of assets and liabilities should we be unable to continue as a going concern. At September 30, 2026, we had not yet generated sufficient revenues or achieved profitable operations, and we have accumulated losses of $22,626,566. We expect to incur further losses in the development of our business, all of which raises substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern depends on our ability to generate future profits and/or to obtain the necessary financing to meet our obligations arising from normal business operations when they come due, of which there can be no assurance.

We anticipate that additional funding will be in the form of additional loans from officers, directors or significant shareholders, or equity financing from the sale of our common stock but cannot assure that any future debt or equity financing will occur.

Cash Flows

A summary of our cash provided by and used in operating, investing and financing activities is as follows:

At September 30, 2026, we had $1,192 in cash and a $2,514,919 working capital deficit. This compares to cash of $547 and a working capital deficit of $2,093,260 at December 31, 2025.

Net cash used in operating activities during the nine months ended September 30, 2026 was $15,205 and was mainly comprised of our $430,953 net loss during the period, adjusted by non-cash charges $25,000 of impairment expense, $23,444 of stock compensation, and a loss on change in derivative liability of $114,043. In addition, it reflects changes in operating assets and liabilities of $253,261.

Net cash used in operating activities during the nine months ended September 30, 2025 was $27,118 and was mainly comprised of our $335,026 net loss during the period, adjusted by non-cash charges of $20,252 of stock compensation, loss on conversion of debt of $19,950 and a loss on change in derivative liability of $118,452. In addition, it reflects changes in operating assets and liabilities of $149,254.

During the nine months ended September 30, 2026, net cash provided by financing activities was $15,850 comprised of $30,000 in proceeds from advances from third parties offset by the repurchase of common stock, related party of $14,150.

During the nine months ended September 30, 2025, net cash provided by financing activities was $26,610 comprised of $140,000 in proceeds from sale of common stock offset by repayment of notes payable of $20,000 and repayment of advances of $93,390.

Off Balance Sheet Arrangements

We do not have and have never had any off-balance sheet arrangements.

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates, assumptions and judgments that affect the amounts reported in the financial statements, including the notes thereto. We consider critical accounting policies to be those that require more significant judgments and estimates in the preparation of our financial statements, including the following: long lived assets; intangible assets valuations; and income tax valuations. Management relies on historical experience and other assumptions believed to be reasonable in making its judgment and estimates. Actual results could differ materially from those estimates.

Management believes its application of accounting policies, and the estimates inherently required therein, are reasonable. These accounting policies and estimates are periodically reevaluated, and adjustments are made when facts and circumstances dictate a change.