encr-20250331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


x			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED March 31, 2025
o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD OF _________ TO _________.

Commission File Number: 001-41489

ENCORE ENERGY CORP.

(Exact name of registrant as specified in its charter)


British Columbia, Canada						Not Applicable
State or other jurisdiction of incorporation or organization						(I.R.S. Employer Identification No.)

5950 Berkshire Lane, Suite 210 Dallas, TX,75225

(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code: 361-239-5449

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol	Name of each exchange on which registered
Common Shares, no par value	EU	The Nasdaq Stock Market LLC TSX Venture Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large, accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large, accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 4, 2025, there were 186,261,281 shares of the registrant’s no par value common shares, the registrant’s only outstanding class of voting securities, outstanding.



	Cautionary Note Regarding Forward Looking Statements	3

PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements	6
	Consolidated Unaudited Balance Sheet as of March 31, 2025 and December 31, 2024
	Consolidated Unaudited Statements of Operations for the Three Months Ended March 31, 2025 and 2024
	Consolidated Unaudited Statements of Equity for the Three Months Ended March 31, 2025 and 2024
	Consolidated Unaudited Statements of Cash Flows for the Three Months Ended March 31, 2025 and 2024
	Notes to the Consolidated Unaudited Financial Statements



Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	10
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	23
Item 4.	Controls and Procedures	24

PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	25









Item 1A.	Risk Factors	25










Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	26
Item 3.	Defaults Upon Senior Securities	26
Item 4.	Mine Safety Disclosures	26
Item 5.	Other Information	26
Item 6.	Exhibits	27


	Signatures	27


●						our history of negative operating cash flows and our ability to develop or maintain positive cash flow from our mining activities;
●						ability to obtain additional financing on acceptable terms when needed;
●						we have experienced negative cash flows from operations and may need additional financing in connection with the implementation of our business and strategic plans from time to time;
●						risks associated with our expansion-by-acquisition strategy;
●						our properties do not contain mineral reserves and some of our properties, projects and facilities may not be economic within a reasonable time period or at all;
●						reliance on key personnel, contractors and experts;
●						conflicts of interest of our directors and officers;
●						risks associated with exploration of, development of, and extraction from mineral properties;
●						our reliance on third party drilling contractors, including an increased risk of loss, including weather related risks or underutilization of drilling rigs;
●						risks inherent to mineral exploration and extraction;
●						the commercial viability of economic extraction of minerals from uranium deposits;
●						the subjectiveness and uncertainty of estimations of mineral resources;
●						future mineral extraction estimates may not be achieved;
●						estimates of commodity prices used in preliminary economic assessments may never be realized;
●						requirements to obtain or retain key permits to advance or achieve extraction;
●						involvement of Native American tribes in the permitting process;
●						challenges to title of our mineral property interests;
●						our ability to attract, retain, train, motivate, and develop skilled employees;
●						existing competition and geopolitical changes in the competitive landscape;
●						public opinion and perception of nuclear energy;
●						volatility in market prices of uranium;
●						applicable laws, regulations and standards, including environmental protection laws and regulations;
●						our ability to raise equity or obtain debt financing;
●						accuracy of extraction, capital and operating cost estimates;
●						ability of novel mining methods for extraction to yield anticipated results;
●						the need for technical innovation and risk of obsolescence;
●						availability of a public market for uranium, including global demand and supply;
●						changes and uncertainty in United States trade policy, tariff and import/export regulations;
●						risks related to our operations on federal lands, including possible designation of national monuments or withdrawal of permits;
●						risks related to our Alta Mesa joint venture;
●						taxation implications of United States holders because the Company is a passive foreign investment company;
●						potential dilution if we issue additional common shares, no par value (the “common shares”) or securities convertible into common shares;
●						price volatility of our common shares;
●						our expectation to not declare or pay dividends;
●						reliance on information technology systems, and cybersecurity risks;
●						the time and resources necessary to comply with corporate governance practices and securities rules and regulations in the United States and Canada;
●						our management’s ability to maintain effective internal controls;
●						our remediation plan and ability to remediate the material weaknesses in our internal controls over financial reporting;
●						potential lack of access to enforcement of civil liabilities against the Company or its directors and officers;
●						our ability to protect our proprietary data, technology and intellectual property;
●						changes in climate conditions; and
●						other risks included under the heading “Risk Factors” in this Annual Report on Form 10-K, filed with the Securities and Exchange Commission (the “SEC”) on March 3, 2025.



(in thousands except per share data)	3/31/2025 (Unaudited)		December 31, 2024
ASSETS
Current assets
Cash and cash equivalents	$	29,704	$	39,701
Prepaid expenses and other current assets	3,335		2,700
Marketable securities	14,817		24,046
Inventory, net	6,182		20,967
Total current assets	54,038		87,414

Mineral rights and properties, net	270,141		271,922

Property, plant and equipment, net	28,723		24,017
Intangible assets, net	1,467		471
Restricted cash	7,752		7,751
Marketable securities, non-current	224		837
Right of use assets - operating lease	262		310

Total assets	$	362,607	$	392,722

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued liabilities	$	8,026	$	7,464
Accounts payable - related parties	184		2,378
Note payable - related party	10,054		20,108
Operating lease liabilities, current	97		130

Total current liabilities	18,361		30,080

Deferred tax liabilities	26,798		26,980
Asset retirement obligations	17,339		16,918

Operating lease liabilities, non-current	185		202
Total liabilities	62,683		74,180
Commitments and contingencies (Note 10)
Stockholders’ equity
Common stock 186,386,281 and 186,114,948 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively	380,868		380,325

Additional paid-in-capital	65,613		59,856
Accumulated deficit	(175,091)		(150,848)
Accumulated other comprehensive loss	(3,532)		(3,597)
Total stockholders' equity	267,858		285,736
Non-controlling interests	32,066		32,806
Total equity	299,924		318,542
Total liabilities and stockholders' equity	$	362,607	$	392,722


	Three Months Ended March 31,
(in thousands except per share data)	2025		2024
Revenue	$	18,239	$	30,394
Cost of sales	18,262		30,863
Gross loss	(23)		(469)
Operating costs:
Mineral property expenditures	5,544		4,650
General and administrative	8,032		5,505
Depreciation, amortization and accretion	1,149		836

Other operating costs	878		818
Total operating expenses	15,603		11,809
Operating loss	(15,626)		(12,278)

Gain on marketable securities, realized	-		252
Interest income	279		440
Interest expense	(346)		(399)

Loss on marketable securities, unrealized	(9,876)		(821)

Other expense	-		(17)
Loss before income taxes	(25,569)		(12,823)
Income tax benefit	(182)		(5,081)
Net loss	(25,387)		(7,742)
Net loss attributable to non-controlling interests	(1,144)		(460)
Net loss attributable to controlling interest	$	(24,243)	$	(7,282)

Net loss per share
Basic	$	(0.13)	$	(0.04)
Diluted	$	(0.13)	$	(0.04)

Weighted average number of shares
Basic	186,222,285		173,486,569
Diluted	186,222,285		173,486,569


	Three Months Ended March 31,
(In thousands)	2025		2024

OPERATING ACTIVITIES
Net loss	$	(25,387)	$	(7,742)
Adjustments to reconcile net income to cash provided by (used in) operating activities
Amortization, depreciation, accretion and depletion	2,159		751
Stock based compensation	878		818

Inventory impairment charge	155		1,860



Exploration costs related to mineral properties	2,746		3,286
Unrealized loss on marketable securities	9,876		821

Realized gain on marketable securities	-		(252)

Changes in operating assets and liabilities:
Receivables, prepaids and deposits	822		(2,499)
Inventories	14,350		(12,635)
Accounts payable and accrued liabilities	(867)		(169)
Asset retirement obligations	(37)		(156)
Deferred tax liability	(182)		(5,120)
Due to related parties	(12,248)		17,988
Net cash used in operating activities	$	(7,735)	$	(3,049)

INVESTING ACTIVITIES
Purchase of property, plant, and equipment	(3,964)		(1,590)

Acquisition of intangible assets	(1,000)		-
Exploration costs related to mineral properties	(2,746)		(3,286)

Purchase of marketable securities	-		(764)
Proceeds from sale of marketable securities	-		548
Net cash used in investing activities	$	(7,710)	$	(5,092)

FINANCING ACTIVITIES
Private placement proceeds	-		10,000
Common stock issuance costs	-		(50)

Proceeds from the At -the-Market ("ATM") sales	-		2,008
Proceeds from exercise of warrants	236		16,934
Proceeds from exercise of stock options	141		901


Proceeds from sale of minority interest	-		39,553
Contributions from non-controlling interest	5,045		20,447
Net cash provided by financing activities	$	5,422	$	89,793

Net (decrease) increase in cash, cash equivalents and restricted cash	(10,023)		81,652
Foreign exchange difference on cash, cash equivalents and restricted cash	27		946
Cash, cash equivalents and restricted cash, beginning of year	47,452		15,173
Cash, cash equivalents and restricted cash, end of period	$	37,456	$	97,771


	Common Stock			Equity Portion of Convertible Promissory Note		Additional Paid- in-Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Noncontrolling Interests		Total Equity
(in thousands except per share data)	Shares	Amount

Balance at January 1, 2024	165,134	$	308,198	$	3,813	$	41,203	$	(89,456)	$	(1,792)	$	-	$	261,966
Net loss	-	-		-		-		(7,282)		-		(460)		(7,742)
Private placement	2,564	10,000		-		-		-		-		-		10,000



Share issuance costs	-	(50)		-		-		-		-		-		(50)
Shares issued for exercise of warrants	5,579	22,297		-		(5,363)		-		-		-		16,934
Shares issued for exercise of stock options	698	2,009		-		(1,108)		-		-		-		901
Shares issued for ATM	496	2,008		-		-		-		-		-		2,008
Share-based compensation	-	-		-		818		-		-		-		818
Equity portion of convertible promissory note	6,872	23,117		(3,813)		-		-		-		-		19,304

Non-controlling interest Investment in Alta Mesa JV	-	-		-		15,458		-		-		39,553		55,011
Cumulative translation adjustment	-	-		-		-		-		202		-		202
Balance at March 31, 2024	181,343	$	367,579	$	-	$	51,008	$	(96,738)	$	(1,590)	$	39,093	$	359,352

Balance at January 1, 2025	186,115	$	380,325	$	-	$	59,856	$	(150,848)	$	(3,597)	$	32,806	$	318,542
Net loss	-	-		-		-		(24,243)		-		(1,144)		(25,387)

Contributions from non-controlling interest	-	-		-		5,045		-		-		1,457		6,502
Inventory transfers to non-controlling interest	-	-		-		-		-		-		(1,053)		(1,053)

Shares issued for exercise of warrants	90	302		-		(66)		-		-		-		236
Shares issued for exercise of stock options	181	241		-		(100)		-		-		-		141

Share-based compensation	-	-		-		878		-		-		-		878


Cumulative translation adjustment	-	-		-		-		-		65				65
Balance at March 31, 2025	186,386	$	380,868	$	-	$	65,613	$	(175,091)	$	(3,532)	$	32,066	$	299,924

SEC Form 10-Q filed by enCore Energy Corp.