TALISKER RESOURCES LTD. Condensed Interim Consolidated Financial Statements
(Unaudited)
As at and for the three months ended March 31, 2024 and 2023
(in Canadian dollars)
Talisker Resources Ltd.
Condensed Interim Consolidated Statements of Financial Position (Unaudited)
(Expressed in Canadian dollars)
March 31, | December 31, | ||||
As at, | Notes | 2024 | 2023 | ||
ASSETS | |||||
Current assets | $ | 2,998,569 | |||
Cash and cash equivalents | 4 | $ | 8,461,525 | ||
Amounts receivable | 5 | 197,411 | 302,172 | ||
Inventory | 232,274 | 216,411 | |||
Prepaid expenses | 520,734 | 621,237 | |||
Total current assets | 3,948,988 | 9,601,345 | |||
Reclamation deposits | 10 | 1,468,300 | 1,468,300 | ||
Property, plant and equipment | 6 | 6,990,342 | 7,115,595 | ||
Exploration and evaluation assets | 7 | 19,748,354 | 19,682,854 | ||
TOTAL ASSETS | $ | 32,155,984 | $ | 37,868,094 | |
LIABILITIES AND SHAREHOLDERS' EQUITY | |||||
Current liabilities | $ | 6,665,442 | |||
Accounts payable and accrued liabilities | 8, 16 | $ | 7,194,757 | ||
RSU Liability | 14 | 13,275 | 9,847 | ||
Current portion of lease obligation | 9 | 110,153 | 111,176 | ||
Total current liabilities | 6,788,870 | 7,315,780 | |||
Provision for site reclamation and closure | 10 | 18,761,738 | 18,621,531 | ||
Lease payable | 9 | 233,111 | 177,105 | ||
Flow through premium liability | 12 | - | 318,000 | ||
Total liabilities | 25,783,719 | 26,432,416 | |||
Shareholders' equity | 101,379,657 | ||||
Issued capital | 11 | 101,364,157 | |||
Share-based payment reserve | 14 | 479,000 | 695,000 | ||
Warrant reserve | 13 | 6,348,200 | 6,348,200 | ||
Accumulated deficit | (101,834,592) | (96,971,679) | |||
Total shareholders' equity | 6,372,265 | 11,435,678 | |||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 32,155,984 | $ | 37,868,094 |
Nature of operations and going concern (note 1)
On behalf of the Board: | ||
Signed: "Terence Harbort" | Signed: "Morris Prychidny" | |
Terence Harbort | Morris Prychidny | |
Chief Executive Officer and Director | Director |
The accompanying notes are an integral part of these condensed interim consolidated financial statements
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Talisker Resources Ltd.
Condensed Interim Consolidated Statements of Loss and Comprehensive Loss (Unaudited)
(Expressed in Canadian dollars)
For the three month periods ended March 31, | Note | 2024 | 2023 | ||
Expenses | 3,645,559 | ||||
Exploration and evaluation expenditures | 16 | $ | $ | 1,023,827 | |
Mine care and maintenance costs | 16 | 273,696 | 262,692 | ||
Consulting and wages | 16 | 486,802 | 503,487 | ||
Administration | 263,689 | 179,648 | |||
Share-based expense | 14 | 3,428 | 19,403 | ||
Public company costs | 16 | 198,926 | 154,426 | ||
Travel and other | 43,846 | 56,338 | |||
Depreciation of property, plant and equipment | 6 | 304,782 | 314,008 | ||
Total expenses | 5,220,728 | 2,513,829 | |||
Other income and expense | 26,050 | ||||
Finance expense | 4,547 | ||||
Foreign currency translation loss | 9,928 | 2,449 | |||
Gain on revaluation of RSU liability | - | (17,333) | |||
Accretion on site reclamation and closure | 10 | 140,207 | 154,082 | ||
176,185 | 143,745 | ||||
Loss before income taxes | 5,396,913 | 2,657,574 | |||
Income tax recovery | (318,000) | (1,951,000) | |||
Net loss and comprehensive loss | $ | 5,078,913 | $ | 706,574 | |
Loss per share - basic and diluted | $ | 0.06 | $ | 0.01 | |
Weighted average common shares outstanding | 89,184,640 | 76,923,030 |
The accompanying notes are an integral part of these condensed interim consolidated financial statements
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Talisker Resources Ltd.
Condensed Interim Consolidated Statements of Changes in Shareholders' Equity (Unaudited) (Expressed in Canadian dollars)
Share-based | Retained | |||||||
Number of | Payment | Warrant | earnings | |||||
Shares | Issued Capital | Reserve | Reserve | (deficit) | Total | |||
(Note 11) | (Note 14) | (Note 13) | ||||||
Balance as at December 31, 2022 | 76,815,882 | 98,154,998 | 3,723,245 | 5,957,200 | $ | (87,717,730) | $ | 20,117,713 |
Issue of shares for acquisition of mineral properties (Note 7) | 30,000 | 17,250 | - | - | - | 17,250 | ||
Exercise of RSU's (Note 11) | 95,333 | 67,925 | - | - | - | 67,925 | ||
Share based payments - options | - | - | 9,746 | - | - | 9,746 | ||
Expiry of stock options | - | - | (113,000) | - | 113,000 | - | ||
Net loss for the period | - | - | - | - | (706,574) | (706,574) | ||
Balance as at March 31, 2023 | 76,941,215 | 98,240,173 | 3,619,991 | 5,957,200 | $ | (88,311,304) | $ | 19,506,060 |
Issue of shares pursuant to private placement, net of issue costs (Note 11) | 10,974,911 | 3,031,528 | - | 391,000 | - | 3,422,528 | ||
Flow through premium liability (Note 11) | - | (318,000) | - | - | - | (318,000) | ||
Issue of shares for acquisition of mineral properties (Note 7) | 30,000 | 17,250 | - | - | - | 17,250 | ||
Exercise of RSU's (Note 11) | 703,350 | 253,206 | - | - | - | 253,206 | ||
Issued pursuant to agreement | 498,901 | 140,000 | - | - | - | 140,000 | ||
Share based payments - options | - | - | 349,649 | - | - | 349,649 | ||
Expiry of stock options | - | - | (3,274,640) | - | 3,274,640 | - | ||
Net loss for the period | - | - | - | - | (11,935,015) | (11,935,015) | ||
Balance as at December 31, 2023 | 89,148,377 | 101,364,157 | 695,000 | 6,348,200 | $ | (96,971,679) | $ | 11,435,678 |
Issue of shares for acquisition of mineral properties (Note 7) | 50,000 | 15,500 | - | - | - | 15,500 | ||
Expiry of stock options | - | - | (216,000) | - | 216,000 | - | ||
Net loss for the period | - | - | - | - | (5,078,913) | (5,078,913) | ||
Balance as at March 31, 2024 | 89,198,377 | 101,379,657 | 479,000 | 6,348,200 | $ | (101,834,592) | $ | 6,372,265 |
The shares outstanding presented have been adjusted to reflect the effect of the 5:1 share consolidation that took place on September 1, 2023. Common
shares, options, RSUs, warrants and per share amounts have been adjusted for the 5:1 share consolidation unless otherwise noted.
The accompanying notes are an integral part of these condensed interim consolidated financial statements
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Talisker Resources Ltd.
Condensed Interim Consolidated Statements of Cash Flows (Unaudited)
(Expressed in Canadian dollars)
For the three month periods ended March 31, | Notes | 2024 | 2023 | |
Cash provided by (used in): | ||||
Operating activities | (5,078,913) | |||
Net loss for the period | $ | $ | (706,574) | |
Items not involving cash: | (318,000) | |||
Income tax recovery | 12 | (1,951,000) | ||
Gain on revaluation of RSU liability | - | (17,333) | ||
Share-based expense | 14 | 3,428 | 30,821 | |
Accretion on site reclamation and closure | 10 | 140,207 | 154,082 | |
Depreciation of property, plant and equipment | 6 | 304,782 | 314,008 | |
Working capital changes | 104,761 | |||
Change in amounts receivable | 84,935 | |||
Change in inventory | (15,863) | (52,375) | ||
Change in prepaid expenses | 100,503 | (5,481) | ||
Change in accounts payable and accrued liabilities | (529,315) | 554,562 | ||
Cash flows used in operating activities | (5,288,410) | (1,594,355) | ||
Investing activities | (50,000) | |||
Acquisition of exploration and evaluation assets | 7 | (51,600) | ||
Acquisition of property, plant and equipment, net of sales | 6 | (78,456) | (2,803) | |
Cash used in investing activities | (128,456) | (54,403) | ||
Financing activities | (46,090) | |||
Repayment of lease and equipment loans | 9 | (79,077) | ||
Cash flows used in financing activities | (46,090) | (79,077) | ||
Net decrease in cash and cash equivalents for the period | (5,462,956) | (1,727,835) | ||
Cash and cash equivalents, beginning of the period | 8,461,525 | 5,726,452 | ||
Cash and cash equivalents, end of the period | $ | 2,998,569 | $ | 3,998,617 |
Supplementary cash flow information | ||||
Interest received | $ | - | $ | 641 |
The accompanying notes are an integral part of these condensed interim consolidated financial statements
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Talisker Resources Ltd.
Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three month periods ended March 31, 2024 and 2023
(Expressed in Canadian dollars)
1. NATURE OF OPERATIONS AND GOING CONCERN
Talisker Resources Ltd. ("Talisker" or the "Company") is a publicly listed company incorporated in British Columbia and continued in the Province of Ontario. The Company is engaged in exploration and evaluation of mineral properties in British Columbia. The Company's shares are traded on the Toronto Stock Exchange (the "TSX") under the symbol TSK. The head office and registered address of the Company is located at 130 Adelaide Street West, Suite 3002, Toronto, Ontario, M5H 3P5.
The condensed interim consolidated financial statements have been prepared on a going concern basis. The going concern basis assumes that the Company will continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business.
Notwithstanding the royalty agreement (Note 7), the Company's ability to continue as a going concern is dependent upon attaining profitable operations, and the ability to raise further public equity or other financing to meet its expenditure commitments in the next twelve months. There is no assurance that these activities will be successful in the future. As at March 31, 2024, the Company had cash of $2,998,569 and the Company recorded an accumulated deficit of $101,834,592 (December 31, 2023: $96,971,679), net loss of $5,078,913 (2023: $706,574), and net cash used in operating activities of $5,228,410 (2023: $1,594,355). The combination of these circumstances set out above represents a material uncertainty which may cast significant doubt upon the Company's ability to continue as a going concern as the Company progresses towards the development of the Bralorne Gold Project. However, the Company is confident that it will have adequate resources to continue in operational existence for the foreseeable future. For this reason, the Company continues to adopt the going concern basis in preparing its condensed interim consolidated financial statements. These condensed interim consolidated financial statements do not reflect the adjustments to the carrying values of assets and liabilities, the reported revenues and expenses, and the balance sheet classifications that would be necessary if the going concern assumptions were not appropriate. These adjustments would be material to the condensed interim consolidated financial statements.
These condensed interim consolidated financial statements were approved and authorized for issuance by the Board of Directors of the Company on May 14, 2024.
2. BASIS OF PRESENTATION Statement of Compliance
These condensed interim consolidated financial statements, including comparatives, have been prepared in accordance with International Accounting Standards ("IAS") 34 'Interim Financial Reporting' ("IAS 34") using accounting policies consistent with IFRS Accounting Standards as issued by the International Accounting Standards Board ("IFRS").
New accounting standards effective as of January 1, 2024, including Amendments to IAS 1 - Non-current Liabilities with Covenants, do not have a material impact on the condensed interim consolidated financial statements.
In addition, IFRS 18 Presentation and Disclosure in Financial Statements was issued by the International Accounting Standards Board in April 2024, with mandatory application of the standard in annual reporting periods beginning on or after January 1, 2027. The Company has not yet assessed the impact of IFRS 18 on the Company's financial statements. No standards have been early adopted in 2024.
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Talisker Resources Ltd.
Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three month periods ended March 31, 2024 and 2023
(Expressed in Canadian dollars)
2. BASIS OF PRESENTATION (continued) Basis of Measurement
These condensed interim consolidated financial statements have been prepared on the basis of accounting policies and methods of computation consistent with those applied in the Company's December 31, 2023 annual financial statements, except for the adoption of new accounting standards effective January 1, 2024 (see discussion above).
Principles of Consolidation
These condensed interim consolidated financial statements for the three month periods ended March 31, 2024 and 2023 include the financial position, financial performance and cash flows of the Company and its subsidiary detailed below:
Country of | Economic | Basis | |
Subsidiary | Incorporation | Interest | of Accounting |
Bralorne Gold Mines Ltd. | Canada | 100% | Full consolidation |
New Carolin Gold Corp. | Canada | 100% | Full consolidation |
Subsidiaries - Subsidiaries are entities over which the Company has control, whereby control is defined as the power to direct activities of an entity that significantly affect the entity's returns so as to obtain benefit from its activities. Control is presumed to exist where the Company has a shareholding of more than one half of the voting rights in its subsidiaries. The effects of potential voting rights that are currently exercisable are considered when assessing whether control exists. Subsidiaries are fully consolidated from the date control is transferred to the Company, and are de-consolidated from the date at which control ceases.
3. SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS
The preparation of financial statements requires the Company's management to make judgments, estimates and assumptions about future events that affect the amounts reported in the financial statements. Although these estimates are based on management's best knowledge of the amount, event or actions, actual results may differ from those estimates.
The areas which require management to make significant judgments, estimates and assumptions in determining carrying values include, but are not limited to:
- Exploration and Evaluation Assets' carrying values and impairment charges - The Company assesses its cash- generating units at each reporting date to determine whether any indication of impairment exists. Where an indicator of impairment exists, an estimate of the recoverable amount is made, which is the higher of the fair value less costs of disposal and value in use. The determination of the recoverable amount requires the use of estimates and assumptions such as long-term commodity prices, discount rates, future capital requirements, exploration potential and future operating performance. Fair value is determined as the amount that would be obtained from the sale of the asset in an arm's-length transaction between knowledgeable and willing parties.
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Talisker Resources Ltd.
Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three month periods ended March 31, 2024 and 2023
(Expressed in Canadian dollars)
- SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS (continued)
- Provision for site reclamation and closure - Provisions for site reclamation and closure have been created based on management estimates. Assumptions, based on the current economic environment, have been made which management believes are a reasonable basis upon which to estimate the future liability as shown in Note 10. These estimates take into account any material changes to the assumptions that occur when reviewed regularly by management and are based on current regulatory requirements. Significant changes in estimates of discount rate, contamination, restoration standards and techniques will result in changes to provisions from period to period. Actual reclamation and closure costs will ultimately depend on future market prices for the costs which will reflect the market condition at the time the costs are actually incurred. The final cost of the currently recognized rehabilitation provisions may be higher or lower than currently provided for.
- CASH AND CASH EQUIVALENTS
The balance at March 31, 2024 consists of cash on deposit with major Canadian banks in interest bearing accounts totaling $2,898,569 (December 31, 2023 - $8,361,525) and guaranteed investment certificates with major Canadian banks of $100,000 (December 31, 2023 - $100,000) for total cash and cash equivalents of $2,998,569 (December 31, 2023 - $8,461,525).
During the three month period ended March 31, 2024, the Company recognized interest income of $nil (2023 - $641).
5. AMOUNTS RECEIVABLE
March 31, | December 31, | |||
As at, | 2024 | 2023 | ||
HST receivable | $ | 181,043 | $ | 286,609 |
Other receivables | $ | 16,368 | 15,563 | |
197,411 | $ | 302,172 |
At March 31, 2024, the Company anticipates full recovery of these amounts and therefore no expected credit loss has been recorded against these receivables. The Company holds no collateral for any receivable amounts outstanding as at March 31, 2024 and December 31, 2023.
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Talisker Resources Ltd.
Notes to the Condensed Interim Consolidated Financial Statements (Unaudited)
For the three month periods ended March 31, 2024 and 2023
(Expressed in Canadian dollars)
6. PROPERTY, PLANT AND EQUIPMENT
Machinery and | Water Treatment | Right-of-Use | |||||
Equipment | Buildings | Land | Facility | Vehicles | Asset | Total | |
$ | $ | $ | $ | $ | $ | $ | |
Balance at December 31, 2022 | 1,266,204 | 5,907,942 | 315,000 | 941,321 | 172,391 | 1,496,476 | 10,099,334 |
Additions | 277,109 | 253,270 | - | - | - | 304,913 | 835,292 |
Disposals | (99,507) | - | - | - | - | - | (99,507) |
Balance at December 31, 2023 | 1,443,806 | 6,161,212 | 315,000 | 941,321 | 172,391 | 1,801,389 | 10,835,119 |
Additions | 28,456 | 50,000 | - | - | - | 101,073 | 179,529 |
Disposals | - | - | - | - | - | - | - |
Balance at March 31, 2024 | 1,472,262 | 6,211,212 | 315,000 | 941,321 | 172,391 | 1,902,462 | 11,014,648 |
ACCUMULATED DEPRECIATION | |||||||
Balance at December 31, 2022 | 770,678 | 569,227 | - | 210,844 | 66,812 | 921,432 | 2,538,993 |
Additions | 378,933 | 449,543 | - | 62,060 | 22,815 | 354,987 | 1,268,338 |
Disposals | (87,807) | - | - | - | - | - | (87,807) |
Balance at December 31, 2023 | 1,061,804 | 1,018,770 | - | 272,904 | 89,627 | 1,276,419 | 3,719,524 |
Additions | 91,709 | 119,107 | - | 15,515 | 5,704 | 72,747 | 304,782 |
Disposals | - | - | - | - | - | - | - |
Balance at March 31, 2024 | 1,153,513 | 1,137,877 | - | 288,419 | 95,331 | 1,349,166 | 4,024,306 |
NET BOOK VALUE | |||||||
At December 31, 2023 | 382,002 | 5,142,442 | 315,000 | 668,417 | 82,764 | 524,970 | 7,115,595 |
At March 31, 2024 | 318,749 | 5,073,335 | 315,000 | 652,902 | 77,060 | 553,296 | 6,990,342 |
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Talisker Resources Ltd.
Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three month periods ended March 31, 2024 and 2023
(Expressed in Canadian dollars)
7. EXPLORATION AND EVALUATION ASSETS
The exploration and evaluation assets for the Company are summarized as follows:
Three month period ended March 31, 2024:
Project | January 1, 2024 | Additions | Disposals | Impairment | March 31, 2024 | |||||
Bralorne Gold Camp | $ | 1,469,234 | ||||||||
Bralorne Gold Project | 1,469,234 | $ | - | $ | - | $ | - | |||
Royalle Property | 243,000 | - | - | - | 243,000 | |||||
NaiKun Wind Crown Grant | 36,000 | - | - | - | 36,000 | |||||
Congress Property | 295,000 | - | - | - | 295,000 | |||||
Big Sheep Property | 120,000 | - | - | - | 120,000 | |||||
Southern BC Properties | - | 5,701,823 | ||||||||
Spences Bridge | 5,701,823 | - | - | - | ||||||
Golden Hornet Property | 67,550 | 65,500 | - | - | 133,050 | |||||
Ladner Gold Project | 11,750,247 | - | - | - | 11,750,247 | |||||
$ | 19,682,854 | $ | 65,500 | $ | - | $ | - | $ | 19,748,354 |
During the three month period ended March 31, 2024, the Company issued 50,000 shares with a value of $15,500 and made cash payments of $50,000 for property acquisitions on the Golden Hornet property.
On June 12, 2023 the Company entered into a royalty agreement with Sprott Resource Streaming and Royalty Corp. ("Sprott") in relation to the Company's Bralorne Gold Project whereby Sprott will pay the Company up to US$31,250,000 for a net smelter returns royalty (the "Royalty") covering all minerals produced from the Project (the "Royalty Transaction"). The Royalty Transaction includes:
- A maximum of US$31,250,000, with a minimum consideration of US$18,750,000, payable as to:
- an initial grant of a 1.12% Royalty for a draw of US$7,000,000 (received) for drilling, detailed engineering and working capital;
- a further 1.88% Royalty for a subsequent draw of US$11,750,000 on, among other things, the signing of a toll milling agreement for mobilization, site infrastructure, resource conversion drilling and working capital; and
- up to a further 2% Royalty, to a maximum of a 5% Royalty, for US$12,500,000 available as needed for site infrastructure, mine start-up capital and working capital;
- An option, exercisable solely at the discretion of the Company until December 31, 2028, to repurchase 50% of the Royalty (as more particularly described below);
• The residual Royalty will be reduced by an additional 50% for no additional consideration following 1.5 million ounces of gold production;
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Talisker Resources Ltd. published this content on 17 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 17 May 2024 17:59:06 UTC.
