STRIA LITHIUM INC.
Condensed Consolidated Interim Financial Statements
For the three and six month periods ended March 31, 2024
(Expressed in Canadian Dollars)
____________________________________________________________________________
Condensed Consolidated Interim Financial Statements | |
Condensed Consolidated Interim Statements of Financial Position | 2 |
Condensed Consolidated Interim Statements of Comprehensive Loss | 3 |
Condensed Consolidated Interim Statements of Changes in Equity | 4 |
Condensed Consolidated Interim Statements of Cash Flows | 5 |
Notes to the Condensed Consolidated Interim Financial Statements | 6 to 16 |
The accompanying unaudited condensed consolidated interim financial statements have been prepared by and are the responsibility of the Company's management.
The Company's independent auditor has not performed a review of these unaudited
condensed consolidated interim financial statements
Stria Lithium Inc.
Condensed Consolidated Interim Statements of Financial Position (Unaudited) (Expressed in Canadian dollars)
March 31, | September 30, | |
As at | 2024 | 2023 |
$ | $ | |
ASSETS | ||
Current assets | ||
Cash | 1,221,399 | 1,689,771 |
Sales tax receivable | 22,146 | 38,109 |
Marketable securities (Note 5) | 410,352 | 1,274,231 |
Tax credits | 79,063 | 79,063 |
Prepaid expenses | 19,935 | 102,465 |
1,752,895 | 3,183,639 | |
Mineral exploration properties (Note 7) | 548,441 | 513,441 |
Exploration and evaluation assets (Note 7) | 200,858 | 199,041 |
Total assets | 2,502,194 | 3,896,121 |
LIABILITIES | ||
Current liabilities | ||
Accounts payable and accrued liabilities | 72,191 | 176,387 |
Deferred government grant (Note 8) | 41,250 | 41,250 |
Total liabilities | 113,441 | 217,637 |
EQUITY | ||
Share capital (Note 9) | 7,803,849 | 7,803,849 |
Warrants (Note 10) | 2,064 | 2,064 |
Contributed surplus (Note 11) | 2,106,492 | 2,106,492 |
Deficit | (7,523,652) | (6,233,921) |
Total equity | 2,388,753 | 3,678,484 |
Total liabilities and equity | 2,502,194 | 3,896,121 |
Going concern (Note 2) | |
On behalf of the Board | |
(signed) "Dean Hanisch" | (signed) "Jeffrey York" |
Dean Hanisch, Director | Jeffrey York, Director |
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
2
Stria Lithium Inc. | ||||
Condensed Consolidated Interim Statements of Comprehensive Loss (Unaudited) | ||||
(Expressed in Canadian dollars) | ||||
Three months | Six months | |||
ended March 31, | ended March 31, | |||
2024 | 2023 | 2024 | 2023 | |
$ | $ | $ | $ | |
Operating expenses | ||||
Management and consulting fees | 112,482 | 127,056 | 210,164 | 237,275 |
Travel and promotion | 17,996 | 74,560 | 123,241 | 120,006 |
Professional fees | 23,683 | 58,607 | 52,600 | 97,551 |
Insurance | 5,873 | 5,779 | 11,746 | 11,558 |
Agent fees | 7,999 | 11,917 | 14,076 | 15,137 |
Stock-based compensation | - | - | - | 180,730 |
Other | 27,044 | 31,487 | 46,402 | 47,900 |
Loss before other income (expenses) | (195,077) | (309,406) | (458,229) | (710,157) |
Other expenses | ||||
Interest and other income | 21,166 | 6,544 | 32,377 | 14,124 |
Change in fair value of financial assets at | ||||
FVTPL (Note 5) | (699,045) | - | (863,879) | - |
Net loss and total comprehensive loss | (872,956) | (302,862) | (1,289,731) | (696,033) |
Basic and diluted net loss per common share | (0.03) | (0.01) | (0.05) | (0.03) |
Basic and diluted weighted average number of | ||||
common shares outstanding | 25,921,036 | 25,321,036 | 25,921,036 | 24,652,107 |
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
3
Stria Lithium Inc. | ||||||
Condensed Consolidated Interim Statements of Changes in Equity (Unaudited) | ||||||
(Expressed in Canadian dollars) | ||||||
Contributed | ||||||
Share capital | Warrants | surplus | Deficit | Total | ||
# of shares | $ | $ | $ | $ | $ | |
Balance, September 30, 2022 | 21,236,036 | 6,747,779 | 10,092 | 1,917,734 | (4,994,492) | 3,681,113 |
Shares issued for cash | 4,085,000 | 954,125 | - | - | - | 954,125 |
Share issuance costs | - | (15,055) | - | - | - | (15,055) |
Stock-based compensation | - | - | - | 180,730 | - | 180,730 |
Net loss | - | - | - | - | (696,033) | (696,033) |
Balance, March 31, 2023 | 25,321,036 | 7,686,849 | 10,092 | 2,098,464 | (5,690,525) | 4,104,880 |
Expiry of warrants | - | - | (8,028) | 8,028 | - | - |
Shares issued to acquire mineral property (Note 7) | 600,000 | 117,000 | - | - | - | 117,000 |
Net loss | - | - | - | - | (543,396) | (543,396) |
Balance, September 30, 2023 | 25,921,036 | 7,803,849 | 2,064 | 2,106,492 | (6,233,921) | 3,678,484 |
Net loss | - | - | - | - | (1,289,731) | (1,289,731) |
Balance, March 31, 2024 | 25,921,036 | 7,803,849 | 2,064 | 2,106,492 | (7,523,652) | 2,388,753 |
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
4
Stria Lithium Inc. Condensed Consolidated Interim Statements of Cash (Expressed in Canadian dollars)
OPERATING ACTIVITIES Net loss Adjustments for: Stock-basedcompensation Change in fair value of financial assets at FVTPL Changes in non-cashworking capital items (Note 12)
Net cash flows from operating activities
INVESTING ACTIVITIES Acquisition of mineral exploraion property (Note 7) Exploration and evaluation costs
Net cash flows from investing activities
FINANCING ACTIVITIES
Proceeds from issuance of shares/units
Share issuance costs
Net cash flows from financing activities
(Decrease) increase in cash Cash, beginning of the period
Cash, end of the period
Flows (Unaudited) | |
Six months ended March 31, | |
2024 | 2023 |
$ | $ |
(1,289,731) | (696,033) |
- | 180,730 |
863,879 | - |
(5,703) | 44,472 |
(431,555) | (470,831) |
(35,000) | - |
(1,817) | (19,582) |
(36,817) | (19,582) |
- | 604,125 |
- | (15,055) |
- | 589,070 |
(468,372) | 98,657 |
1,689,771 | 2,734,971 |
1,221,399 | 2,833,628 |
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
5
Stria Lithium Inc.
Notes to the Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and six month periods ended March 31, 2024
(Expressed in Canadian dollars)
-
NATURE OF OPERATIONS
Stria Lithium Inc. (the "Company" or "Stria") was incorporated on May 24, 2011 under the Canada Business Corporations Act. The Company's shares are listed on the TSX Venture Exchange under the symbol SRA.
The head office of the Company is located at 945 Princess Street, Box # 118, Kingston, Ontario.
The Company is engaged in the acquisition, exploration, and development of mineral properties in Quebec, Canada. - GOING CONCERN ASSUMPTION
The condensed consolidated interim financial statements have been prepared on a going concern basis, which assumes that the Company will continue to operate for the foreseeable future and will be able to realize its assets and discharge its liabilities in the normal course of business. The Company is in the exploration stage and has not earned revenue from operations. During the six month period ended March 31, 2024, the Company had a net loss of $1,289,731 and had negative cash flows from operations of $431,555. In addition, the Company has a deficit of $7,523,652.
The above factors indicate that a material uncertainty exists that may cast significant doubt about the
Company's ability to continue as a going concern. In assessing whether the going concern assumption is appropriate, management takes into account all available information about the future, which is at least, but not limited to, twelve months from the end of the reporting period. This assessment is based upon planned actions that may or may not occur for a number of reasons including the Company's own resources and external market conditions.
The Company's ability to continue as a going concern, realize its assets and discharge its liabilities in the normal course of business, meet its corporate administrative obligations and continue its exploration activities over the next twelve months is dependent upon management's ability to obtain additional financing, through various means including but not limited to equity financing. No assurance can be given that any such additional financing will be available, or that it can be obtained on terms favorable to the Company.
The condensed consolidated interim financial statements do not reflect adjustments that would be necessary if the going concern assumption was not appropriate. If the going concern basis was not appropriate for the condensed consolidated interim financial statements, then adjustments would be necessary to the carrying amounts of assets and liabilities, the reported expenses and the classifications used in the condensed consolidated interim statements of financial position. - BASIS OF PRESENTATION AND COMPLIANCE WITH IFRS
The condensed consolidated interim financial statements for the three and six month periods ended March 31, 2024 are expressed in Canadian dollars, which is the functional currency of the Company. They have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting ("IAS 34"). They do not include all of the information and disclosures required in annual financial statements in accordance with International Financial Reporting Standards ("IFRS") and should be read in conjunction with the
Company's consolidated financial statements for the years ended September 30, 2023 and 2022.
The condensed consolidated interim financial statements have been prepared in accordance with the accounting policies used in the Company's financial statements for the years ended September 30, 2023 and 2022.
When preparing the condensed consolidated interim financial statements, management undertakes a number of judgments, estimates and assumptions about recognition and measurement of assets, liabilities, income and expenses. The actual results may differ from the judgments, estimates and assumptions made by management. The judgments, estimates and assumptions applied in the condensed consolidated interim
6
Stria Lithium Inc.
Notes to the Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and six month periods ended March 31, 2024
(Expressed in Canadian dollars)
financial statements, including the key sources of estimation uncertainty, were consistent with those applied in the Company's consolidated financial statements for the years ended September 30, 2023 and 2022.
The condensed consolidated interim financial statements were approved for issue by the Board of Directors on May 22, 2024.
4. RISK MANAGEMENT AND CAPITAL MANAGEMENT Risk management
The Company thoroughly examines the various financial risks to which it is exposed and assesses the impact and likelihood of those risks. These risks include credit risk, liquidity risk and market risk. Where material, these risks are reviewed and monitored by the Board of Directors.
(i) Credit risk
Credit risk is the risk of an unexpected loss if a party to its financial instruments fails to meet its contractual obligations. The Company's financial assets exposed to credit risk include cash and maximum exposure is equal to the carrying value totalling $1,221,399 at March 31, 2024. The Company's cash is held at a Canadian chartered bank with high external credit ratings. It is management's opinion that the Company is not exposed to significant credit risk.
Management considers that all the above financial assets that are not impaired or past due for each of the reporting dates are of good credit quality. There are no financial assets that are past due but not impaired for the periods presented.
(ii) Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company manages its liquidity needs by carefully monitoring cash outflows due in day-to-day business as well as anticipated transactions. As at March 31, 2024, the Company had working capital of $1,639,454, including $1,221,399 in cash and current liabilities of $113,441 due within the next 12 months. There has been no change to management's assessment of liquidity risk compared with the prior year.
(iii) Market risk
The Company holds shares in a publicly listed company in the mineral exploration industry. The Company is exposed to market risk regarding these shares as unfavorable market conditions could result in the disposal at less than their value at March 31, 2024. As at March 31, 2024, the value of these listed shares was $410,352. At March 31, 2024, had the price for these publicly listed shares been 10% lower, the comprehensive loss for the six month period ended March 31, 2024 would have been $41,035 greater. Conversely, had the price been 10% higher, the comprehensive loss would have been $41,035 less.
Capital management
The Company manages its capital to ensure its ability to continue as a going concern and to provide an adequate return to its shareholders as well as ensuring that all flow-through monies obtained are utilized in exploration activities and spent by the required deadline. In the management of capital, the Company includes the components of shareholders' equity and loans from related parties. As long as the Company is in the exploration stage with its mining properties, it is not the intention of the Company to contract additional debt obligations to finance its work programs. The Company manages the capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying assets. To maintain or adjust the capital structure, the Company may attempt to issue new shares. When financing conditions are not optimal, the Company may enter into option agreements or find other solutions to continue its activities or
7
Stria Lithium Inc.
Notes to the Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and six month periods ended March 31, 2024
(Expressed in Canadian dollars)
may slow its activities until conditions improve. The Company is not subject to any capital requirements imposed by a lending institution or regulatory body, other than those of the TSX Venture Exchange ("TSXV") which requires adequate working capital or financial resources of the greater of (i) $50,000 and (ii) an amount required in order to maintain operations and cover general and administrative expenses for a period of 6 months. As of March 31, 2024, the Company believes it is compliant with the policies of the TSXV. In order to facilitate the management of its capital requirements, the Company prepares annual budgets that are updated as necessary depending on various factors, including successful capital deployment and general industry conditions.
The Company's capital management objectives, policies and processes have remained unchanged during the six month period ended March 31, 2024.
5. MARKETABLE SECURITIES
Marketable securities are classified as fair value through profit or loss and are comprised of:
March 31, | September 30, | |
2024 | 2023 | |
$ | $ | |
Cygnus Metals Limited (1) | 410,352 | 1,274,231 |
- In July 2023, the Company received 9,129,825 shares in Cygnus Metals Limited in connection with the optioning of the Company's Pontax Central property (Note 7). On initial recognition, the shares were recorded at a value of $2,000,000, based on the 10 day VWAP of Cygnus' shares at the time.
During the six month period ended March 31, 2024, the Company recorded a decrease in fair value of financial assets at fair value through profit or loss of $863,879.
8
Stria Lithium Inc.
Notes to the Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and six month periods ended March 31, 2024
(Expressed in Canadian dollars)
6. FINANCIAL INSTRUMENTS
The Company's financial instruments consist of cash, marketable securities and accounts payable and accrued liabilities. The fair value of these financial instruments approximates their carrying value due to their short-term nature. The fair value of the Company's marketable securities is based on quoted prices in an active market (Level 1).
The classification of financial instruments is as follows:
March 31, | September 30, | |
As at | 2024 | 2023 |
$ | $ |
Financial assets | ||
Amortized cost | ||
Cash | 1,221,399 | 1,689,771 |
Fair value through profit or loss | ||
Marketable securities | 410,352 | 1,274,231 |
Total financial assets | 1,631,751 | 2,964,002 |
Financial liabilities | ||
Amortized cost | ||
Accounts payable and accrued liabilities | (72,191) | (176,387) |
Total financial liabilities | (72,191) | (176,387) |
7. MINERAL EXPLORATION PROPERTIES AND EXPLORATION AND EVALUATION ASSETS
March 31, 2024 | September 30, 2023 | |||
Exploration | Exploration | |||
Mineral | and | Mineral | and | |
exploration | evaluation | exploration | evaluation | |
properties | assets | properties | assets | |
$ | $ | $ | $ | |
a) Pontax Central (formerly Pontax-Lithium) | - | - | - | - |
b) Romer | 237,500 | 92,037 | 237,500 | 92,037 |
c) Pontax II | 275,941 | 108,821 | 275,941 | 107,004 |
d) Project Jeremiah | 35,000 | - | - | - |
548,441 | 200,858 | 513,441 | 199,041 |
- Pontax Central (formerly Pontax-Lithium)
On December 6, 2013, the Company acquired a 100% interest in the Pontax Central property from Khalkos
Exploration Inc. ("Khalkos") in consideration for a cash payment of $100,000 and the issuance of 833,333 common shares. The property was recorded at a value of $350,000 upon initial recognition, based on the fair value of the property received and consideration paid. The Pontax Central property is comprised of a group of 68 contiguous mining claims located in the James Bay Territory of Northern Quebec.
9
Stria Lithium Inc.
Notes to the Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and six month periods ended March 31, 2024
(Expressed in Canadian dollars)
On October 17, 2022, the Company announced the execution of a definitive agreement (the "Definitive Agreement") with Cygnus Metals Limited (formerly Cygnus Gold Limited) (ASX: CY5) ("Cygnus") following the execution of a binding term sheet between the parties dated July 26, 2022. Pursuant to the Definitive Agreement, Cygnus has been granted the sole and exclusive option (the "Option") to acquire up to a 70% undivided interest in Stria's Pontax Central property (the "Property") under a two-stage option for total cash payments of $6,000,000 and exploration expenditure commitments totaling $10,000,000 (the "Transaction"). Following the exercise of the Option, the parties will form a joint venture (the "Joint Venture") with each of Cygnus and Stria holding an undivided interest of 70% and 30% respectively, with Cygnus acting as operator of the Joint Venture. Stria's interest in the Joint Venture will be free carried until Cygnus delivers a feasibility study on the property.
In consideration for the Option, Cygnus paid cash consideration of $1,000,000 and subscribed for 1,400,000 common shares of the Company at a price of $0.25 per common share for aggregate gross proceeds of $350,000 (Note 9). During the 2022 fiscal year, Stria received a total of $1,350,000 from Cygnus in respect of these conditions, which was included in deposits in the consolidated statement of financial position at September 30, 2022, pending the execution of the Definitive Agreement and closing of the subscription for shares, both of which occurred in October 2022.
The terms of the two-stage option are as follows:
- Option to acquire a 51% undivided interest ("First Option")
Under the First Option, Cygnus is required to incur exploration expenditures on the Property in the amount of $4,000,000 over a period of 18 months. Following completion of such expenditures, in order to complete the First Option, Cygnus shall pay Stria a cash amount of $2,000,000.
- Option to acquire an additional 19% interest ("Second Option")
Under the Second Option, conditional upon the exercise of the First Option, Cygnus shall incur additional exploration expenditures in the amount of $6,000,000 over a period of 30 months from the date of exercise of the First Option. Following completion of such expenditures, in order to complete the Second Option, Cygnus shall pay Stria an additional cash amount of $3,000,000. Upon the exercise of the Second Option, Cygnus shall have acquired a 70% undivided interest in the Property. In the event Cygnus elects not to proceed with, or otherwise fails to exercise the Second Option, the parties will form the Joint Venture with Cygnus automatically transferring a 2% undivided interest back to Stria for a nominal consideration. Each of Cygnus and Stria shall thereafter hold an undivided Joint Venture interest of 49% and 51% respectively, with Stria becoming operator of the Joint Venture
In addition, during the year ended September 30, 2022, Stria incurred exploration expenditures on the Pontax Central property in the amount of $133,593, which were reimbursed by Cygnus in December 2022.
On July 5, 2023, the Company received the final milestone payment of $2,000,000 from Cygnus in the form of 9,129,825 shares. The shares were recorded at a value of $2,000,000, based on the 10 day VWAP of Cygnus shares ($0.2191 per share). In connection with the milestone payment, the Company recognized a gain on optioning of mineral exploration property in the amount of $1,049,149, representing the amount by which the $2,000,000 option payment exceeded the carrying value of the property. Following satisfaction of the $2,000,000 payment, Cygnus earned a 51% interest in the Pontax Central property, in accordance with the Definitive Agreement.
- Romer
On August 11, 2022, the Company completed the acquisition of the Romer property from Braille Energy Systems Inc. ("BESI"), a related party which shares common management, for total consideration of $237,500, comprised of $125,000 in cash and 750,000 common shares of Stria with a fair value of $112,500. The Romer
10
Attachments
- Original Link
- Original Document
- Permalink
Disclaimer
Stria Lithium Inc. published this content on 19 June 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 19 June 2024 15:03:06 UTC.