Canada Nickel : Condensed Interim Consolidated Financial Statements For the Three Months Ended January 31, 2022 and 2021

Canada Nickel Company Inc.

Condensed Interim Consolidated Financial Statements

For the Three Months Ended January 31, 2022 and 2021

(Expressed in Canadian Dollars, unless otherwise noted)

Canada Nickel Company Inc.

Condensed Interim Consolidated Statements of Financial Position (Expressed in Canadian Dollars)

Unaudited

Nature of operations and going concern (Note 1)

Commitments and contingencies (Note 13)

The accompanying notes are an integral part of these condensed interim consolidated financial statements.

January 31	October 31
Note	2022	2021
$	$
ASSETS
Current assets
Cash and cash equivalents	3,579,219	3,334,643
Harmonized sales tax receivable	1,514,115	3,300,595
Accounts receivable	352,700	352,700
Prepaid expenses	428,824	430,226
Total current assets	5,874,858	7,418,164
Non-current assets
Exploration and evaluation assets	4	77,844,467	47,304,907
Equipment and right-of-use assets	5	603,284	527,784
Total assets	84,322,609	55,250,855
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued liabilities	12,13	6,235,024	6,992,243
Short-term loan facility	6	12,453,471
Flow-through share premium	7(a)	-	959,399
Total liabilities	18,688,495	7,951,642
Shareholders' equity
Share capital	7	69,292,758	51,036,468
Share-based compensation and warrant reserves	8,9,10	7,328,831	5,718,120
Deficit	(10,987,475)	(9,455,375)
Total shareholders' equity	65,634,114	47,299,213
Total liabilities and shareholders' equity	84,322,609	55,250,855
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Subsequent events (Note 15)

Signed on behalf of the Board:

"Mark Selby"

Mark Selby, Director

"David Smith"

David Smith, Director

Condensed Interim Consolidated Statements of Loss and Comprehensive Loss (Expressed in Canadian Dollars)

Unaudited

For the Three Months Ended January 31

Note	2022	2021
$	$
Expenses
Salaries and management fees	12	254,845	141,560
General and administrative costs	242,497	223,859
Professional fees	111,915	107,650
Consulting and advisory	230,301	304,964
Promotion and communication	128,658	134,992
Investor relations and marketing	76,980	65,323
Share-based compensation	9,10	1,001,748	686,286
Travel and other	4,901	5,410
Transaction costs, interest and accretion expense	6	439,654	-
2,491,499	1,670,044
Flow-through share premium	7(a)	(959,399)	(282,027)
Net loss and comprehensive loss	1,532,100	1,388,017
Loss per share - basic and diluted	11	$0.02	$0.02
Weighted average number of shares outstanding	91,160,063	80,097,896

The accompanying notes are an integral part of these condensed interim consolidated financial statements.

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Condensed Interim Consolidated Statements of Cash Flow (Expressed in Canadian Dollars)

Unaudited

For the Three Months Ended January 31

Note	2022	2021
$	$
Operating activities
Net loss	(1,532,100)	(1,388,017)
Add - transaction costs included in financing activities	136,700	-
Adjustments for non-cash items:
Share-based compensation	1,001,748	686,286
Flow-through share premium	(959,399)	(282,027)
Accretion on short-term loan facility	6	189,455	-
Changes in non-cash working capital items:
Harmonized sales tax receivable	1,786,480	(373,712)
Prepaid expenses	1,402	(105,959)
Accounts payable and accrued liabilities	340,768	159,742
Net cash provided by (used in) operating activities	965,054	(1,303,687)
Investing activities
Exploration and evaluation expenditures	4	(12,970,989)	(2,281,479)
Purchase of equipment	5	(51,574)	(35,161)
Net cash used in investing activities	(13,022,563)	(2,316,640)
Financing activities
Proceeds from short-term loan facility, net of
transaction costs	6	12,302,085	-
Share issuance costs	-	(115,000)
Proceeds from exercise of warrants	8	-	72,833
Net cash provided by (used in) financing activities	12,302,085	(42,167)
Cash and cash equivalents, beginning of period	3,334,643	11,167,265
Net change in cash and cash equivalents	244,576	(3,662,494)
Cash and cash equivalents, end of period	3,579,219	7,504,771
Supplementary disclosure
Value of shares issued for acquisitions	4	16,971,090	-
Value of shares issued for settlement of accounts
payable	7(b)	-	391,750
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The accompanying notes are an integral part of these condensed interim consolidated financial statements.

Canada Nickel Company Inc.

Condensed Interim Consolidated Statement of Changes in Shareholders' Equity (Expressed in Canadian Dollars)

Unaudited

Note	Number of	Share-based
common	compensation	Warrants
shares	Share capital	reserve	reserve	Deficit	Total
#	$	$	$	$	$
Balance, October 31, 2020	79,939,316	30,729,738	1,165,057	2,574,426	(3,077,272)	31,391,949
Share issuance - warrants exercised	8	152,094	182,566	-	(69,019)	-	113,547
Fair value of share-based compensation	9,10	-	-	686,286	-	-	686,286
Shares issued to settle 2020 accounts payable	192,781	-	-	-	-	-
Shares issued to settle 2021 accounts payable	50,000	114,500	-	-	-	114,500
Shares to be issued to settle accounts payable	-	239,513	-	(64,513)	-	175,000
Net loss for the three months ended January 31	-	-	-	-	(1,388,017)	(1,388,017)
Balance, January 31, 2021	80,334,191	31,266,317	1,851,343	2,440,894	(4,465,289)	31,093,265
Balance, October 31, 2021	88,383,650	51,036,468	5,551,009	167,111	(9,455,375)	47,299,213
Share issuance - restricted share units exercised	10	50,000	53,200	(53,200)	-	-	-
Share issuance - acquisitions	4	5,164,000	16,971,090	-	-	-	16,971,090
Fair value of warrants issued	6	-	-	-	283,140	-	283,140
Fair value of share-based compensation	9,10	-	-	1,380,771	-	-	1,380,771
Shares to be issued to settle accounts payable	7(b)	-	1,232,000	-	-	-	1,232,000
Net loss for the three months ended January 31	-	-	-	-	(1,532,100)	(1,532,100)
Balance, January 31, 2022	93,597,650	69,292,758	6,878,580	450,251	(10,987,475)	65,634,114

The accompanying notes are an integral part of these condensed interim consolidated financial statements.

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