Price: $0.07 Common Shares: 47,426,195 Options/Warrants: Nil Insider Holdings: 15,391,328 or 32.5% as per www.Sedi.ca Website: www.canafgroup.com Financials (All in US Dollars – Should Be Converted into CDN Dollars for accurate value) ASSETS (USD) Cash: $671,367 Trade Receivables: $907,084 Income Tax Receivable: $27.960 Sales Tax Receivable: $1,575 Inventories: $504,600 Prepaid Expenses: $39,166 Property & Equipment: $1,202,245 Intangible: $1 Total Assets: $3,353,998 (USD) LIABILITIES Trade Payables: $732,024 Sales Tax Receivable: $39,234 Income Tax Payable: $958 Current Bank Loan: $78,590 Total Bank Loan: $411,488 Total Liabilities: $1,262,294 Q1 2017 Results Sales: $2,991,706 Net Income: $198,221 USD Q2 2017 Results Sales: $3,490,753 Net Income: $236,961 USD Q3 2017 Results Sales: 1,961,208 Net Income: $187,796 USD Nine Month Results (2017) Sales: $8,443,667 Net Income: $622,730 USD Earnings Per Share: $622,730 USD X 1.235(rate today) = $767,490 CAD $767,490 CAD / 47,426,195 (shares) = $0.016 CAD earnings per share MD&A Highlights After an extremely positive and profitable first two quarters to the financial year, Q3 reflects an expected short-term period of depressed Sales, and subsequent reduction in earnings. Despite Sales reducing significantly for the period, the Corporation remained profitable, again demonstrating its resilience in difficult trading conditions. Sales are expected to increase slightly for Q4 and Q1, 2018. Revenue for the 9-month period increased to $8,443,667 in comparison to $2,907,198 for the same period last fiscal year. The Corporation recorded a net income of $595,716 (C$741,080), in comparison to a net loss of $335,864 for the same period the previous year. Adjusted EBITDA rose to $881,885 (C$1,097,080) for the period. The Corporation continues to understand that for Southern Coal to reach its full potential, its customer bases needs to increase so to reduce its reliability on key suppliers. Southern Coal is continuing to work with a new potential major customer to supply product in South Africa and remains hopeful for trial loads to be dispatched in Q1 or Q2 2018. The board believes that it is in the interest of the Corporation, and its shareholders, that Southern Coal (Pty) Ltd., achieves a Broad-Based Black Economic Empowerment, (“B-BBEE), Level 4 rating during the fiscal year 2018. During the quarter the Corporation can confirm that it has had discussions with its customers over the need for Southern Coal to improve its current B-BBEE rating so to remain compliant with its customers own supplier requirements. During the coming three months, the Corporation expects to announce the details of a deal that is currently being negotiated and finalized by specialists. All in all, the board is of the belief that the final deal that will be agreed will be one that will ensure sustainability and offer growth opportunity for the South African business. The Corporation intends to continue to generate positive free cash flow during the fiscal year-end 2017 and will focus on increasing shareholders’ value, as well as investment to improve the efficiency of its older facilities, or investment into related business opportunities in South Africa The Corporation has an agreement to lease premises for its coal processing plant in South Africa for a term of ten years, expiring on December 31, 2020. The agreement offers the Corporation, in lieu of rent, feedstock coal to be delivered to its adjacent premises, which it purchases at market price. Should the Corporation decide to purchase feedstock coal from an alternative supplier which the lessor is otherwise able to provide, then a monthly rent of Rand 200,000 ($14,846) is payable. To date, the Corporation has not been required to pay any rent for the premises as it has continued to purchase feedstock coal from the landlord. The bank loan bears interest at 9.25% per annum, matures on January 7, 2019, and is secured by the Corporation’s furnace acquired with the proceeds from the loan. The bank loan is repayable over 42 months in blended monthly payments of Rand 393,779 ($29,230 translated at October 31, 2016 exchange rate). During the period ended July 31, 2017, the Corporation incurred interest expense totaling $42,420 (October 31, 2017 – $71,721). In August 2006, Canaf, then known as Uganda Gold Mining, announced the termination of any further investment into its Kilembe Copper-Cobalt Project in Uganda. Since 2007, the Corporation has been involved in a legal dispute with Kilembe Mines Limited, (“KML”). In January 2013, the High Court of Uganda referred the case back to arbitration for settlement. On May 29, 2013, a preliminary meeting was held between the Corporation, KML and the arbitrator. The Corporation can confirm that further meetings were scheduled for August 2013, after filings of amended statements of defence and claims had been submitted. Since the initial meeting however the Government has awarded a deal to a Chinese Consortium to manage and operate KML. The Corporation’s appointed Ugandan Advocates have notified the board that the Arbitrator has stepped down for personal reasons. The Corporation’s Uganda Advocates and the Government’s Solicitor General have agreed to a new Arbitrator, Retired Justice James Ogoola. The parties held a preliminary meeting with the Arbitrator who requested them to provide him with their fee estimate for the conduct of the Arbitration. The estimate has since been provided to the Arbitrator who is yet to confirm whether or not he is agreeable to it. In the meantime the Corporation appointed SRK Consultants to prepare a brief document to quantify the ‘lost opportunity’ value of the termination of the Kilembe Project. During the current financial year the Corporation will utilize this document to assist in the submission of a revised claim against KML. The Corporation has received no new information since 2014, and the Corporation remains unable to give an indication of either the quantum or any likely date by which a settlement will or will not be reached. The original claim, before costs, is for a money sum of US$10,370,368 as at January 24, 2007.