Canada Nickel : Interim consolidated financial statements for the three months ended January 31, 2022

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

			January 31	October 31
	Note	2022	2021
ASSETS		$	$
Current assets		3,579,219	3,334,643
Cash and cash equivalents
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		77,844,467	47,304,907
Exploration and evaluation assets	4
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		6,235,024	6,992,243
Accounts payable and accrued liabilities	12,13
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		69,292,758	51,036,468
Share capital	7
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

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

Nature of operations and going concern (Note 1)

Commitments and contingencies (Note 13)

Subsequent events (Note 15)

Signed on behalf of the Board:
"Mark Selby"	"David Smith"
Mark Selby, Director	David Smith, Director

2

Canada Nickel Company Inc.

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		$	$
	254,845
Salaries and management fees	12	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.

3

Canada Nickel Company Inc.

Condensed Interim Consolidated Statements of Cash Flow

(Expressed in Canadian Dollars)

Unaudited

For the Three Months Ended January 31

	Note	2022	2021
Operating activities		$	$
	(1,532,100)
Net loss		(1,388,017)
Add - transaction costs included in financing activities		136,700	-
Adjustments for non-cash items:		1,001,748
Share-based compensation		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:		1,786,480	(373,712)
Harmonized sales tax receivable
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		(12,970,989)
Exploration and evaluation expenditures	4	(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		12,302,085
transaction costs	6	-
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

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

4

Canada Nickel Company Inc.

Condensed Interim Consolidated Statement of Changes in Shareholders' Equity

(Expressed in Canadian Dollars)

Unaudited

	Note	Number of		Share-based	Warrants
		common	Share capital	compensation	Deficit	Total
		shares	reserve	reserve
		#	$	$	$	$	$
Balance, October 31, 2020	8	79,939,316	30,729,738	1,165,057	2,574,426	(3,077,272)	31,391,949
Share issuance - warrants exercised	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.

5