FIREWEED METALS CORP.
(An Exploration Stage Company)
(Unaudited - Expressed in Canadian Dollars)
Condensed Interim Consolidated Financial Statements
March 31, 2024 and 2023
Index
Condensed Interim Consolidated Statements of Financial Position
Condensed Interim Consolidated Statements of Loss and Comprehensive Loss Condensed Interim Consolidated Statements of Cash Flows
Condensed Interim Consolidated Statements of Changes in Shareholders' Equity Notes to the Condensed Interim Consolidated Financial Statements
Notice of non-review of condensed consolidated interim financial statements
In accordance with National Instrument 51-102 Continuous Disclosure Obligations of the Canadian Securities Administrators, notice is given that the attached condensed consolidated interim financial statements for three- month period ended March 31, 2024 have not been reviewed by the Company's auditors.
FIREWEED METALS CORP.
Condensed Interim Consolidated Statements of Financial Position (Unaudited - expressed in Canadian Dollars)
As at
March 31, | December 31, | |||
2024 | 2023 | |||
Note(s) | $ | $ | ||
Assets | ||||
Current assets: | ||||
Cash and cash equivalents | 15,977,071 | 19,224,378 | ||
Receivables | 118,438 | 283,021 | ||
Prepaid expenses | 385,386 | 358,078 | ||
16,480,895 | 19,865,477 | |||
Equipment and right of use assets | 5 | 2,107,962 | 2,194,203 | |
Reclamation bond | 39,596 | 39,596 | ||
Exploration and evaluation assets | 4 | 17,361,564 | 17,361,564 | |
35,990,017 | 39,460,840 | |||
Current liabilities: | ||||
Accounts payable and accrued liabilities | 6,12 | 1,961,845 | 2,229,756 | |
Lease liability, short-term | 7 | 456,034 | 442,621 | |
Purchase obligation | 4 | 3,272,885 | 3,182,204 | |
Short-term loan payable | 8 | - | 40,000 | |
5,690,764 | 5,894,581 | |||
Flow-through premium liability | 9 | - | 103,871 | |
Lease liability, long-term | 7 | 195,112 | 314,276 | |
Rehabilitation provisions | 10 | 595,421 | 589,088 | |
6,481,297 | 6,901,816 | |||
Shareholders' equity: | ||||
Capital stock | 11 | 108,962,312 | 108,033,387 | |
Options reserve | 11 | 5,359,323 | 4,831,622 | |
Warrants reserve | 11 | 183,253 | 183,253 | |
Deficit | (84,996,168) | (80,489,238) | ||
29,508,720 | 32,559,024 | |||
35,990,017 | 39,460,840 | |||
Nature and continuance of operations (Note 1) | ||||
Commitment (Note 16) | ||||
Subsequent events (Note 17) | ||||
On behalf of the Board: | ||||
"Peter Hemstead" | Director, Interim CEO and | "Adrian Rothwell" | Director | |
President |
The accompanying notes are an integral part of these condensed interim consolidated financial statements
FIREWEED METALS CORP.
Condensed Interim Consolidated Statements of Loss and Comprehensive Loss (Unaudited - expressed in Canadian Dollars)
For the three months ended,
March 31, | March 31, | ||
2024 | 2023 | ||
Note(s) | $ | $ | |
Expenses | |||
Consulting and management | 12 | 493,671 | 615,755 |
Depreciation | 5 | 165,252 | 14,552 |
Director and committee fees | 12 | 51,000 | 42,358 |
Exploration and evaluation | 4 | 2,571,307 | 1,148,493 |
Investor relations and corporate development | 289,005 | 246,421 | |
Interest expense | 7 | 21,656 | - |
Professional fees | 13,297 | 28,413 | |
Property investigation | 4 | - | 234,703 |
Share-based compensation | 11,12 | 562,563 | 321,215 |
Transfer agent & filing fees | 45,756 | 158,634 | |
General & administrative | 330,814 | 144,629 | |
(4,544,321) | (2,955,173) | ||
Accretion on rehabilitation provision | 10 | (6,333) | (2,740) |
Amortization of flow-through liability | 9 | 103,871 | 298,423 |
Part XII.6 Tax | (193,307) | - | |
Finance expense on purchase obligation | 4 | (90,681) | - |
Foreign exchange | (3,248) | (2,686) | |
Interest income | 217,089 | 468,578 | |
Gain on Debt | 8 | 10,000 | - |
Loss and comprehensive loss for the period | (4,506,930) | (2,193,598) | |
Loss per share - basic and diluted | (0.03) | (0.02) | |
Weighted average number of common shares | |||
outstanding - basic and diluted | 145,969,843 | 135,201,032 |
The accompanying notes are an integral part of these condensed interim consolidated financial statements
FIREWEED METALS CORP.
Condensed Interim Consolidated Statements of Cash Flows (Unaudited - expressed in Canadian Dollars)
For the three months ended
March 31, | March 31, | |
2024 | 2023 | |
$ | $ | |
OPERATING ACTIVITIES | ||
Loss for the period | (4,506,930) | (2,193,598) |
Adjustment for items not affecting cash: | ||
Amortization of flow-through liability | (103,871) | (298,423) |
Accretion on rehabilitation provision | 6,333 | 2,740 |
Depreciation | 165,252 | 14,552 |
Finance expense on purchase obligation | 90,681 | - |
Share-based compensation | 562,563 | 321,215 |
Interest on lease obligations | 21,656 | - |
Change in non-cash working capital items: | ||
Receivables | 164,583 | 9,902 |
Prepaid expenses | (27,308) | (599,550) |
Accounts payable and accrued liabilities | (267,911) | 18,011 |
(3,894,952) | (2,725,151) | |
INVESTING ACTIVITIES | ||
Acquisition of equipment | (79,011) | (93,121) |
(79,011) | (93,121) | |
FINANCING ACTIVITIES | ||
Repayment of CEBA loan | (40,000) | - |
Proceeds from warrants exercised | 835,001 | 81,900 |
Proceeds from options exercised | 59,062 | - |
Lease payments | (127,407) | - |
726,656 | 81,900 | |
Increase (decrease) in cash | (3,247,307) | (2,736,372) |
Cash and cash equivalents, beginning of the period | 19,224,378 | 39,885,979 |
Cash and cash equivalents, end of the period | 15,977,071 | 37,149,607 |
Cash | 14,687,071 | 39,985,979 |
Cash equivalents | 1,290,000 | - |
15,977,071 | 39,985,979 | |
Supplemental disclosures with respect to cash flows: | ||
Non-cash investing and financing activities: | ||
Fair value of exercised options | 34,862 | - |
Fair value of exercised finders' warrants | - | 21,609 |
The accompanying notes are an integral part of these condensed interim consolidated financial statements
FIREWEED METALS CORP.
Condensed Interim Consolidated Statements of Changes in Shareholders' Equity (Unaudited - expressed in Canadian Dollars)
Capital Stock | |||||||
Shares | Amount | Warrants reserve | Options reserve | Deficit | Total | ||
Notes | # | $ | $ | $ | $ | $ | |
Balance at December 31, 2022 | 135,191,999 | 93,379,425 | 351,145 | 2,655,682 | (47,225,187) | 49,161,065 | |
Share-based compensation | 11 | - | - | - | 321,215 | - | 321,215 |
Warrants exercised | 11 | 117,000 | 103,509 | (21,609) | - | - | 81,900 |
Loss for the period | - | - | - | - | (2,193,598) | (2,193,598) | |
Balance at March 31, 2023 | 135,308,999 | 93,482,934 | 329,536 | 2,976,897 | (49,418,785) | 47,370,582 | |
Balance at December 31, 2023 | 145,445,800 | 108,033,387 | 183,253 | 4,831,622 | (80,489,238) | 32,559,024 | |
Share-based compensation | 11 | - | - | - | 562,563 | - | 562,563 |
Options exercised | 11 | 81,800 | 93,924 | - | (34,862) | - | 59,062 |
Warrants exercised | 11 | 1,391,668 | 835,001 | - | - | - | 835,001 |
Loss for the period | - | - | - | - | (4,506,930) | (4,506,930) | |
Balance at March 31, 2024 | 146,919,268 | 108,962,312 | 183,253 | 5,359,323 | (84,996,168) | 29,508,720 |
The accompanying notes are an integral part of these condensed interim consolidated financial statements
FIREWEED METALS CORP.
Notes to the Condensed Interim Consolidated Financial Statements For the Three Months Ended March 31, 2024 and 2023 (Unaudited - expressed in Canadian Dollars)
-
Nature and Continuance of Operations
Fireweed Metals Corp. (the "Company") was incorporated under the Business Corporations Act of the Yukon in Canada on October 20, 2015. The Company is a mineral exploration and development company and is engaged in the acquisition and exploration of mineral assets. At March 31, 2024, the Company had three projects in northern Canada, the Macmillan Pass Project (Yukon), the Mactung Project (Yukon/NWT) and the Gayna River Zinc Project (NWT). The Company is listed on the TSX Venture Exchange and trades under the symbol FWZ in Canada, and on the OTCQB Venture Market under the symbol FWEDF in the USA.
The Company's head office and principal address is Suite 1020 - 800 West Pender Street, Vancouver, British Columbia, Canada V6C 2V6. The registered and records office is 3081 3rd Avenue, Whitehorse, Yukon, Canada Y1A 4Z7.
The Company's ability to continue operations is not assured and is dependent upon the ability to obtain necessary financing to meet its liabilities and commitments as they become due, and the ability to generate future profitable production or operations or obtain sufficient proceeds from the disposition thereof. The outcome of these matters cannot be predicted at this time. These condensed interim financial statements do not include adjustments to amounts and classifications of assets and liabilities that might be necessary should the Company be unable to continue operations. As at March 31, 2024, the Company had an accumulated deficit of $80,489,238, current assets of $16,480,895 to settle current liabilities of $5,690,764, leaving the Company with a working capital of $13,970,896. However, additional financing will be required to carry out additional exploration and development of its properties. These factors indicate the existence of material uncertainty that may cast significant doubt about the Company's ability to continue as a going concern.
The condensed interim consolidated financial statements for the period ended March 31, 2024, have been prepared by management, reviewed by the Audit Committee and authorized for issue by the Board of Directors on May 21, 2024. - Basis of Presentation and Statement of Compliance
These condensed interim consolidated financial statements have been prepared in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board ("IASB") for interim information, specifically International Accounting Standards ("IAS") 34 - Interim Financial Reporting. In addition, these condensed consolidated interim financial statements have been prepared using interpretations issued by the International Financial Reporting Interpretation Committee ("IFRIC") in effect at March 31, 2024 and the same accounting policies and methods of their application as the most recent annual financial statements of the Company. These condensed interim consolidated financial statements do not include all disclosures normally provided in the annual financial statements and should be read in conjunction with the Company's audited consolidated financial statements for the year ended December 31, 2023. In management's opinion, all adjustments necessary for fair presentation have been included in these condensed interim consolidated financial statements. Interim results are not necessarily indicative of the results expected for the year ending December 31, 2024.
The condensed interim consolidated financial statements have been prepared on a historical cost basis, except for financial instruments classified as fair value through profit or loss, which are stated at their fair value. All dollar amounts presented are in Canadian dollars unless otherwise specified. In addition, the condensed interim financial statements have been prepared using the accrual basis of accounting, except for cash flow information.
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FIREWEED METALS CORP.
Notes to the Condensed Interim Consolidated Financial Statements For the Three Months Ended March 31, 2024 and 2023 (Unaudited - expressed in Canadian Dollars)
3. Material Accounting Policies
The accounting policies in preparation of these condensed interim consolidated financial statements are consistent with those applied and disclosed in the Company's audited consolidated financial statements for the year ended December 31, 2023.
Principles of Consolidation
These condensed interim consolidated financial statements include the financial statements of Fireweed Metals Corp. and its wholly owned subsidiaries Fireweed Macpass Mining Ltd., Fireweed Mactung Mining Ltd., and Fireweed Gayna River Metals Ltd., incorporated in British Columbia.
Critical accounting judgment
The preparation of these condensed interim financial statements requires management to make judgements regarding the going concern of the Company as discussed in Note 1.
The preparation of these condensed interim financial statements requires making judgments that affect the amounts reported. The most significant accounting judgements that management has made relate to exploration and evaluation assets and potential indicators for impairment. Management makes judgements in reviewing exploration and evaluation assets for indicators of impairment. Management considers, among other things, whether or not (i) the period for which the Company has the right to explore in the specific area has expired during the period or will expire in the near future, and is not expected to be renewed; (ii) substantive expenditure on further exploration for and evaluation of mineral resources in the specific area is neither budgeted nor planned; (iii) exploration for and evaluation of mineral resources in the specific area have not led to the discovery of commercially viable quantities of mineral resources and the Company has decided to discontinue such activities in the specific area; and (iv) whether sufficient data exists to indicate that, although a development in the specific area is likely to proceed, the carrying amount of the exploration and evaluation asset is unlikely to be recovered in full from successful development or by sale. In considering these factors, management did not identify any impairment indicators for the period ended March 31, 2024.
Key sources of estimation uncertainty
Carrying value and recoverability of exploration and evaluation assets
The carrying amount of the Company's exploration and evaluation assets do not necessarily represent present or future values, and the Company's exploration and evaluation assets have been accounted for under the assumption that the carrying amount will be recoverable. Recoverability is dependent on various factors, including the discovery of economically recoverable reserves, the ability of the Company to obtain the necessary financing to complete the development and upon future profitable production or proceeds from the disposition of the mineral properties themselves.
Additionally, there are numerous geological, economic, environmental and regulatory factors and uncertainties that could impact management's assessment as to the overall viability of its properties or to the ability to generate future cash flows necessary to cover or exceed the carrying value of the Company's exploration and evaluation assets.
Share-based compensation
Share-based compensation expense is measured by reference to the fair value of the stock options at the date at which they are granted. Estimating fair value for granted stock options requires determining the most appropriate valuation model which is dependent on the terms and conditions of the grant. This estimate also requires determining the most appropriate inputs to the valuation model including the expected life of the option, volatility, dividend yield, and rate of forfeitures and making assumptions about them. The value of the share- based compensation expense for the periods ended March 31, 2024 and 2023 are disclosed in Note 10.
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FIREWEED METALS CORP.
Notes to the Condensed Interim Consolidated Financial Statements For the Three Months Ended March 31, 2024 and 2023 (Unaudited - expressed in Canadian Dollars)
Rehabilitation provision
The calculation of the asset retirement obligation involves significant measurement estimates and assumptions of the amount and timing of reclamation costs and applicable inputs used in the calculation, such as inflation and discount rates. The Company bases its estimates on historical experience, government regulations and assumptions that are believed to be reasonable given the scope of the exploration project. Refer to Note 9 for more details.
4. Exploration and Evaluation Assets and Expenditures Exploration and Evaluation Assets
MacMillan | ||||
Pass | Gayna River | Mactung | Total | |
Exploration & Evaluation Assets | $ | $ | $ | $ |
Acquisition and maintenance costs: | ||||
Balance, December 31, 2022 | 12,655,113 | 57,752 | - | 12,712,865 |
Change in rehabilitation provision | 149,310 | - | - | 149,310 |
Initial recognition of rehabilitation | ||||
provision | 45,638 | 45,638 | ||
Cash payments | - | - | 904 | 904 |
Transfer of deposit | - | - | 1,500,000 | 1,500,000 |
Purchase obligation | - | - | 2,952,847 | 2,952,847 |
Balance, December 31, 2023 and March | ||||
31, 2024 | 12,804,423 | 57,752 | 4,499,389 | 17,361,564 |
Exploration & Evaluation Expenditures | ||||
Assaying | 174,668 | - | 174,668 | 174,668 |
Camp and field | 214,527 | - | 214,527 | 214,527 |
Drilling | 254,117 | - | 254,117 | 254,117 |
Engineering | 22,058 | - | 22,058 | 22,058 |
Exploration Contracting | 2,000 | 27,500 | 29,500 | 2,000 |
Geological Consulting | 20,583 | 6,600 | 27,183 | 20,583 |
Insurance and other | 18,888 | - | 18,888 | 18,888 |
Permitting, Environment, Social | 400,775 | 300 | 401,075 | 400,775 |
Reporting | 5,400 | - | 5,400 | 5,400 |
Travel & Support | 1,077 | - | 1,077 | 1,077 |
Balance, March 31, 2023 | 1,114,093 | 34,400 | 1,148,493 | 1,114,093 |
Assaying | 339,687 | - | - | 339,687 |
Camp and field | 506,088 | - | 24,641 | 530,729 |
Drilling | 253,316 | - | - | 253,316 |
Engineering | 96,056 | - | 279,973 | 376,029 |
Exploration Contracting | - | 25,113 | - | 25,113 |
Geological Consulting | 285,769 | - | 3,645 | 289,414 |
Insurance and other | 13,201 | - | - | 13,201 |
Permitting, Environment, Social | 540,457 | - | 185,857 | 726,314 |
Reporting | 8,800 | - | - | 8,800 |
Travel & Support | 8,704 | - | - | 8,704 |
Balance, March 31, 2024 | 2,052,078 | 25,113 | 494,116 | 2,571,307 |
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FIREWEED METALS CORP.
Notes to the Condensed Interim Consolidated Financial Statements For the Three Months Ended March 31, 2024 and 2023 (Unaudited - expressed in Canadian Dollars)
Macmillan Pass Project, Yukon, Canada
Summary of Property Acquisitions and Royalties
The Property comprises multiple claim blocks that were acquired and consolidated over several years by Fireweed into the current Macmillan Pass property. Summaries of the underlying claim blocks/properties and royalties are described below.
Fireweed holds 100% interest in various claims comprising the Tom and Jason property. The Jason claims have a third party underlying 3% net smelter return royalty ("NSR") which can be bought out at any time for 1.5% for $1,250,000 and 1.5% for $4,000,000. There are no underlying royalties on the Tom claims.
Fireweed holds 100% interest in various claims comprising the Nidd property. The claims are subject to a 1% NSR royalty and a right of first offer to purchase future production concentrates from the Nidd property.
Fireweed holds 100% interest in various claims comprising the Mac property. These claims are subject to a production royalty of 0.25% NSR on base metals and other non-precious minerals, 1% NSR on silver and other precious metals excluding gold, and 3% NSR on gold produced.
Fireweed holds 100% interest in the MC, MP and Jerry claims. These claims are subject to production royalties of 0.5% NSR on base metals and silver, and 2% NSR on all other metals including gold produced from the MC, MP and Jerry claims. The vendors are entitled to one additional payment of $750,000 or equivalent in Fireweed shares at the Company's option, upon receiving a resource calculation of at least 2.0 million tonnes of indicated (or better) resource on any part of the MC, MP or Jerry claims. Fireweed maintains a right of first refusal on the sale of any NSR royalty from these claims.
Fireweed holds 100% interest in the BR claims and NS claims. These claims are subject to production royalties of 0.5% NSR on base metals and silver, and 2% NSR on all other metals including gold produced from the BR and NS claims. The vendors are entitled to one additional payment of $750,000 or equivalent in Fireweed shares at the Company's option, upon receiving a resource calculation of at least 2.0 million tonnes of indicated (or better) resource on any part of the BR or NS claims. Fireweed will have the right to purchase one-half of these NSR royalties for $2,000,000 at any time prior to the commencement of commercial production. Fireweed maintains a right of first refusal on the sale of any NSR royalty from these claims by Golden Ridge. There is also a pre-exiting third party 3% NSR royalty on any future cobalt production from the BR and NS claims.
Fireweed holds 100% interest in various claims comprising the Sol property. The claims are subject to a 0.5% NSR on all base metals and silver and a 2% NSR on all other metals including gold, which may be mined from the property. There is an additional private third-party royalty consisting of a 2% NSR on production from the Sol Property, of which 1% may be extinguished for $2,000,000.
On January 13, 2022, the Company exercised its option and acquired 100% interest in various claims comprising the Oro property. Payment terms to exercise the option were as follows:
Due Date | Cash | Common Shares |
On or before January 18, 2021 | $250,000 (paid) | 500,000 (issued) |
On or before January 13, 2022 | $250,000 (paid) | 500,000 (issued) |
TOTAL | $500,000 | 1,000,000 |
The property is subject to a 0.5% NSR on all base metals and silver and a 2% NSR on all other metals including gold, which may be mined from the Oro property.
Mactung Project, Yukon/NWT, Canada
On June 7, 2022, Fireweed signed a binding Letter of Intent to purchase the Mactung Project. On May 3, 2023, the Company and the Government of the Northwest Territories ("GNWT") finalized an assignment and assumption agreement (the "Agreement") for the purchase of the Mactung Project.
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Fireweed Metals Corp. published this content on 17 June 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 17 June 2024 20:06:17 UTC.