RACKLA METALS INC. FINANCIAL REVIEW
Three Months ended March 31, 2024
(An Exploration Stage Company)
CONDENSED INTERIM FINANCIAL STATEMENTS
For the three months ended March 31, 2024
(Unaudited - Prepared by Management)
(Expressed in Canadian Dollars)
NOTICE OF NO AUDITOR REVIEW OF
CONDENSED INTERIM FINANCIAL STATEMENTS
In accordance with National Instrument 51-102 of the Canadian Securities Administrators, the Company discloses that its external auditors have not reviewed the unaudited condensed interim financial statements for the three months ended March 31, 2024. These condensed interim financial statements have been prepared by management and approved by the Audit Committee and the Board of Directors of the Company.
RACKLA METALS INC.
(An Exploration Stage Company)
CONDENSED INTERIM STATEMENTS OF FINANCIAL POSITION (UNAUDITED) (Expressed in Canadian Dollars)
March 31, | December 31, | |||
2024 | 2023 | |||
ASSETS | ||||
Current assets | ||||
Cash (Note 4) | $ | 724,067 | $ | 1,181,671 |
Equity investments (Note 5) | 1,501 | 1,501 | ||
Taxes receivable | 15,034 | 189,094 | ||
Prepaid expenses and deposits (Note 13) | 174,500 | 257,666 | ||
915,102 | 1,629,932 | |||
Non-current assets | ||||
Deposits (Note 13) | 101,000 | 101,000 | ||
Equipment (Note 6) | 25,064 | 30,515 | ||
Exploration and evaluation assets (Note 7) | 962,972 | 962,972 | ||
1,089,036 | 1,094,487 | |||
TOTAL ASSETS | $ | 2,004,138 | $ | 2,724,419 |
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||
Current liabilities | ||||
Accounts payable and accrued liabilities | $ | 61,860 | $ | 356,375 |
Due to related parties (Note 13) | 50,676 | 47,863 | ||
Current portion of lease liability (Note 9) | 18,432 | 17,958 | ||
Other liability (Note 10) | 56,300 | 71,649 | ||
187,268 | 493,845 | |||
Non-current liability | ||||
Lease liability (Note 9) | 1,625 | 6,416 | ||
Total liabilities | 188,893 | 500,261 | ||
Shareholders' equity | ||||
Share capital (Note 11) | 16,237,918 | 16,237,918 | ||
Other equity reserves (Note 11) | 1,001,767 | 989,119 | ||
Accumulated other comprehensive loss | (58,249) | (58,249) | ||
Deficit | (15,366,191) | (14,944,630) | ||
Total shareholders' equity | 1,815,245 | 2,224,158 | ||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 2,004,138 | $ | 2,724,419 |
APPROVED BY THE BOARD OF DIRECTORS AND AUTHORIZED FOR ISSUE ON MAY 27, 2024:
"Simon Ridgway" | "William Katzin" | |
Simon Ridgway, Director | William Katzin, Director |
The accompanying notes are an integral part of these condensed interim financial statements
1
RACKLA METALS INC.
(An Exploration Stage Company)
CONDENSED INTERIM STATEMENTS OF LOSS AND COMPREHENSIVE LOSS (UNAUDITED) (Expressed in Canadian Dollars)
Three months ended March 31, | ||||
2024 | 2023 | |||
EXPLORATION EXPENDITURES (Notes 8 and 13) | $ | 178,198 | $ | 104,231 |
GENERAL AND ADMINISTRATIVE EXPENSES | ||||
Amortization | 5,451 | 112 | ||
Consulting fees | 25,000 | - | ||
Interest expense on lease liability (Note 9) | 600 | - | ||
Legal and audit fees | 1,118 | 6,177 | ||
Management fees (Note 13) | 10,500 | 13,200 | ||
Office and administrative (Note 13) | 26,498 | 32,187 | ||
Salaries and benefits (Note 13) | 52,288 | 54,021 | ||
Share-based payments (Notes 12 and 13) | 13,691 | 806,319 | ||
Shareholder communications (Note 13) | 113,260 | 72,291 | ||
Transfer agent and regulatory fees (Note 13) | 8,874 | 10,279 | ||
Travel and accommodation (Note 13) | 12,008 | 15,178 | ||
269,288 | 1,009,764 | |||
(447,486) | (1,113,995) | |||
Interest income | 9,533 | 31,380 | ||
Loss before income taxes | (437,953) | (1,082,615) | ||
Deferred income tax recovery (Note 10) | 15,349 | 29,856 | ||
Net loss and comprehensive loss for the period | $ | (422,604) | $ | (1,052,759) |
Basic and diluted loss per share | $(0.01) | $(0.02) | ||
Weighted average number of common shares outstanding | 71,380,686 | 58,196,308 | ||
The accompanying notes are an integral part of these condensed interim financial statements
2
RACKLA METALS INC.
(An Exploration Stage Company)
CONDENSED INTERIM STATEMENTS OF CHANGES IN EQUITY (UNAUDITED)
For the three months ended March 31, 2024 and 2023
(Expressed in Canadian Dollars)
Other equity reserves | ||||||||||||||
Accumulated | ||||||||||||||
Number of | Share | other | ||||||||||||
common | Share | Share-based | purchase | Compensation | comprehensive | |||||||||
shares | capital | payments | warrants | options | income (loss) | Deficit | Total | |||||||
Balance, December 31, 2022 | 58,196,308 | $ 13,578,009 | $ | 46,025 | $ | - | $ | - | $ | (56,749) | $ | (10,158,411) | $ | 3,408,874 |
Net loss for the period | - | - | - | - | - | - | (1,052,759) | (1,052,759) | ||||||
Share-based payments | - | - | 806,319 | - | - | - | - | 806,319 | ||||||
Balance, March 31, 2023 | 58,196,308 | 13,578,009 | 852,344 | - | - | (56,749) | (11,211,170) | 3,162,434 | ||||||
Net loss for the period | - | - | - | - | - | - | (3,796,274) | (3,796,274) | ||||||
Shares issued on private | ||||||||||||||
placements | 10,569,000 | 2,536,560 | - | 105,690 | - | - | - | 2,642,250 | ||||||
Shares issued for property | ||||||||||||||
acquisition | 2,610,378 | 584,500 | - | - | - | - | - | 584,500 | ||||||
Options exercised | 5,000 | 500 | - | - | - | - | - | 500 | ||||||
Share issuance costs | - | (462,173) | - | - | 94,421 | - | - | (367,752) | ||||||
Transfer of other equity | ||||||||||||||
reserve on exercise of | ||||||||||||||
options | - | 522 | (522) | - | - | - | - | - | ||||||
Fair value of forfeited | ||||||||||||||
options | - | - | (62,814) | - | - | - | 62,814 | - | ||||||
Fair value loss on equity | ||||||||||||||
investments | - | - | - | - | - | (1,500) | - | (1,500) | ||||||
Balance, December 31, 2023 | 71,380,686 | 16,237,918 | 789,008 | 105,690 | 94,421 | (58,249) | (14,944,630) | 2,224,158 | ||||||
Net loss for the period | - | - | - | - | - | - | (422,604) | (422,604) | ||||||
Fair value of forfeited options | - | - | (1043) | - | - | - | 1,043 | - | ||||||
Share-based payments | - | - | 13,691 | - | - | - | - | 13,691 | ||||||
Balance, March 31, 2024 | 71,380,686 | $ 16,237,918 | $ | 801,656 | $ | 105,690 | $ | 94,421 | $ | (58,249) | $ | (15,366,191) | $ | 1,815,245 |
The accompanying notes are an integral part of these condensed interim financial statements
3
RACKLA METALS INC.
(An Exploration Stage Company)
CONDENSED INTERIM STATEMENTS OF CASH FLOWS (UNAUDITED) (Expressed in Canadian Dollars)
Three months ended March 31,
20242023
Cash provided by (used in): | ||||
OPERATING ACTIVITIES | ||||
Net loss for the period | $ | (422,604) | $ | (1,052,759) |
Items not involving cash: | ||||
Amortization | 5,451 | 112 | ||
Deferred income tax recovery | (15,349) | (29,856) | ||
Share-based payments | 13,691 | 806,319 | ||
(418,811) | (276,184) | |||
Changes in non-cash working capital items: | ||||
Taxes receivable | 174,060 | (18,657) | ||
Prepaid expenses | 83,166 | (223,475) | ||
Accounts payable and accrued liabilities | (294,515) | (55,374) | ||
Due to related parties | 2,813 | (74,393) | ||
(453,287) | (648,083) | |||
FINANCING ACTIVITY | ||||
Repayment of lease obligation (net) | (4,317) | - | ||
(4,317) | - | |||
INVESTING ACTIVITY | ||||
Purchase of equipment | - | (2,996) | ||
Acquisition of exploration and evaluation assets | - | (36,534) | ||
- | (39,530) | |||
Decrease in cash | (457,604) | (687,613) | ||
Cash, beginning of period | 1,181,671 | 4,427,903 | ||
Cash, end of period | $ | 724,067 | $ | 3,740,290 |
The accompanying notes are an integral part of these condensed interim financial statements
4
RACKLA METALS INC.
(An Exploration Stage Company)
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UNAUDITED) For the three months ended March 31, 2024 and 2023
(Expressed in Canadian Dollars)
-
CORPORATE INFORMATION
Rackla Metals Inc. (the "Company") is pursuing opportunities related to exploration of mineral resource properties. The Company was incorporated in the Province of British Columbia on September 20, 2011, and its common shares are listed on the TSX Venture Exchange ("TSX-V") under the symbol RAK.
The address of the Company's corporate office and principal place of business is Suite 650, 200 Burrard Street, Vancouver, BC, Canada V6C 3L6. - BASIS OF PREPARATION
These condensed interim financial statements are prepared in accordance with International Accounting
Standard ("IAS") 34 Interim Financial Reporting under IFRS Accounting Standards ("IFRS") issued by the
International Accounting Standards Board ("IASB"). These condensed interim financial statements follow the same accounting policies and methods of application as the most recent annual financial statements of the Company. These condensed interim financial statements do not contain all of the information required for full annual financial statements. Accordingly, these condensed interim financial statements should be read in conjunction with the Company's most recent annual financial statements, which were prepared in accordance with IFRS as issued by the IASB.
Basis of Measurement
These condensed interim financial statements have been prepared on the historical cost basis, except for certain financial instruments carried at fair value. In addition, these condensed interim financial statements have been prepared using the accrual basis of accounting, except for cash flow information.
The presentation and functional currency of the Company is the Canadian dollar.
The preparation of financial statements in compliance with IFRS requires management to make certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies. The areas involving a higher degree of judgment of complexity, or areas where assumptions and estimates are significant to the condensed interim financial statements are disclosed in Note 3.
Ability to Continue as a Going Concern
These condensed interim financial statements have been presented on the basis that the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Realization values may be substantially different from the carrying values shown and these financial statements do not give effect to adjustments that would be necessary to the carrying values and classification of assets and liabilities should the Company be unable to continue as a going concern. Such adjustments could be material. At March 31, 2024, the Company has not yet achieved profitable operations, has an accumulated deficit of $15,366,191 (December 31, 2023: $14,944,630) since inception, and is expected to incur further losses in the development of its business, all of which raise significant doubt about its ability to continue as a going concern. The Company will periodically have to raise additional financing in order to acquire and conduct work programs on mineral properties and meet its ongoing levels of corporate overhead and discharge its liabilities as they come due (Note 17). While the Company has been successful in securing financings in the past, there is no assurance that it will be able to do so in the future.
5
RACKLA METALS INC.
(An Exploration Stage Company)
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UNAUDITED) For the three months ended March 31, 2024 and 2023
(Expressed in Canadian Dollars)
3. CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS
The Company makes estimates and assumptions about the future that affect the reported amounts of assets and liabilities. Estimates and judgments are continually evaluated based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. In the future, actual experience may differ from these estimates and assumptions.
The effect of a change in an accounting estimate is recognized prospectively by including it in profit or loss in the period of the change, if the change affects that period only, or in the period of the change and future periods, if the change affects both.
The key areas of judgment applied in the preparation of the condensed interim financial statements that could result in a material adjustment to the carrying amounts of assets and liabilities are as follows:
- Although the Company has taken steps to verify title to mineral properties in which it has an interest, these procedures do not guarantee the Company's title. Such properties may be subject to prior agreements or transfers and title may be affected by undetected defects.
-
The application of the Company's accounting policy for exploration and evaluation expenditures requires judgment in determining whether it is likely that future economic benefits will flow to the Company.
Assets or CGUs are evaluated at each reporting date to determine whether there are any indications of impairment. The Company considers both internal and external sources of information when making the assessment of whether there are indications of impairment for the Company's exploration and evaluation assets.
In respect of costs incurred for its investment in exploration and evaluation assets, management has determined the acquisition costs that have been capitalized may not be economically recoverable. Management uses several criteria in its assessments of economic recoverability and probability of future economic benefit, including access to financing to further exploration and development, geologic and metallurgic information, economics assessment/studies, accessible facilities, and existing permits. - Although the Company has taken steps to identify any decommissioning liabilities related to mineral properties in which it has an interest, there may be unidentified decommissioning liabilities present.
- The Company applies judgment in determining whether a lease contract contains an identified asset, whether they have the right to control the asset, and the lease term. The lease term is based on considering facts and circumstances, both qualitative and quantitative, that can create an economic incentive to exercise renewal options. Management considers all facts and circumstances that create an economic incentive to exercise an extension option, or not to exercise a termination option.
- The Company applies judgment in determining exploration costs that qualify as flow-through eligible Canadian exploration expenditures.
- The assessment of the Company's ability to continue as a going concern and to raise sufficient funds to pay for its operating expenditures, meet its liabilities for the subsequent year, and to fund planned contractual exploration programs, involves significant judgment based on historical experiences and other factors including expectation of future events that are believed to be reasonable under the circumstances.
The key estimate applied in the preparation of the condensed interim financial statements that could result in a material adjustment to the carrying amounts of assets and liabilities is as follows:
- Option pricing models require the input of highly subjective assumptions, including the expected price volatility and options expected life. Changes in these assumptions can materially affect the fair value estimate and, therefore, the existing models do not necessarily provide a reliable single measure of the fair value of the Company's stock options.
6
RACKLA METALS INC.
(An Exploration Stage Company)
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UNAUDITED) For the three months ended March 31, 2024 and 2023
(Expressed in Canadian Dollars)
-
CASH
Cash at banks is held in interest-bearing and non-interest-bearing accounts. As at March 31, 2024, the Company's cash in hand totaled $724,067 (December 31, 2023: $1,181,671), of which $493,956 (December 31, 2023: $628,004) is reserved for flow-through eligible activities during the 2024 fiscal year (Note 10). - EQUITY INVESTMENTS
As of March 31, 2024, equity investments consisted of 75,000 common shares of Damara Gold Corp.
("Damara"), a public company, and 200,000 common shares of Voyager Gold Corp. ("Voyager"), a private company with a common director. The private company shares were initially measured at fair value and subsequently written down to $1.
As at March 31, 2024, the carrying amount for the equity investments was $1,501 (December 31, 2023: $1,501).
During the periods ended March 31, 2024 and 2023, there was no change in fair value of the Damara shares. This amount was recorded as a fair value loss in other comprehensive loss.
Damara | Voyager | Total | ||||
Balance, December 31, 2022 | $ | 3,000 | $ | 1 | $ | 3,001 |
Change in fair value | (1,500) | - | (1,500) | |||
Balance, December 31, 2023 | 1,500 | 1 | 1,501 | |||
Balance, March 31, 2024 | $ | 1,500 | $ | 1 | $ | 1,501 |
6. | EQUIPMENT | |||||||
Right-of-use | ||||||||
Computer | asset | |||||||
equipment | (Note 9) | Total | ||||||
Cost | ||||||||
Balance, December 31, 2022 | $ | - | $ | - | $ | - | ||
Additions | 2,996 | 41,982 | 44,978 | |||||
Balance, December 31, 2023 | 2,996 | 41,982 | 44,978 | |||||
Balance, March 31, 2024 | $ | 2,996 | $ | 41,982 | $ | 44,978 | ||
Accumulated amortization | ||||||||
Balance, December 31, 2022 | $ | - | $ | - | $ | - | ||
Charge for the year | 449 | 14,014 | 14,463 | |||||
Balance, December 31, 2023 | 449 | 14,014 | 14,463 | |||||
Charge for the period | 225 | 5,226 | 5,451 | |||||
Balance, March 31, 2024 | $ | 674 | $ | 19,240 | $ | 19,914 | ||
Carrying amounts | ||||||||
At December 31, 2023 | $ | 2,547 | $ | 27,968 | $ | 30,515 | ||
At March 31, 2024 | $ | 2,322 | $ | 27,742 | $ | 25,064 | ||
7
Attachments
- Original Link
- Original Document
- Permalink
Disclaimer
Rackla Metals Inc. published this content on 10 June 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 June 2024 11:53:06 UTC.
