Palamina : Financial Statements

PALAMINA CORP.

UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTH PERIODS ENDED MARCH 31, 2022 AND 2021

MANAGEMENT'S RESPONSIBILITY FOR

FINANCIAL REPORTING

The accompanying unaudited interim consolidated financial statements of Palamina Corp. (the "Company") are the responsibility of the management and Board of Directors of the Company.

The unaudited interim consolidated financial statements have been prepared by management, on behalf of the Board of Directors, in accordance with the accounting policies disclosed in the notes to the unaudited interim consolidated financial statements. Where necessary, management has made informed judgments and estimates in accounting for transactions which were not complete at the statement of financial position date. In the opinion of management, the interim consolidated financial statements have been prepared within acceptable limits of materiality and are in accordance with International Accounting Standard 34 Interim Financial Reporting of International Financial Reporting Standards using accounting policies consistent with International Financial Reporting Standards appropriate in the circumstances.

Management has established systems of internal control over the financial reporting process, which are designed to provide reasonable assurance that relevant and reliable financial information is produced.

The Board of Directors is responsible for reviewing and approving the unaudited interim consolidated financial statements together with other financial information of the Company and for ensuring that management fulfills its financial reporting responsibilities. An Audit Committee assists the Board of Directors in fulfilling this responsibility. The Audit Committee meets with management to review the financial reporting process and the unaudited interim consolidated financial statements together with other financial information of the Company. The Audit Committee reports its findings to the Board of Directors for its consideration in approving the unaudited interim consolidated financial statements together with other financial information of the Company for issuance to the shareholders.

Management recognizes its responsibility for conducting the Company's affairs in compliance with established financial standards, and applicable laws and regulations, and for maintaining proper standards of conduct for its activities.

Andrew Thomson	Brian Jennings
President and Chief Executive Officer	Chief Financial Officer

NOTICE TO READER

The accompanying unaudited interim consolidated financial statements of the Company have been prepared by and are the responsibility of management. The unaudited interim consolidated statements for the three month periods ended March 31, 2022 and 2021 have not been reviewed by the Company's auditors.

PALAMINA CORP.

Unaudited Interim Consolidated Statements of Financial Position

(Expressed in Canadian dollars)

	March 31,	December 31,
	2022	2021
As at,	$	$
ASSETS
Current
Cash and cash equivalents (Note 5)	1,622,080	2,233,309
Receivables (Note 6)	34,712	60,800
Prepaid expenses (Note 7)	134,372	238,427
Total current assets	1,791,164	2,532,536
Equipment (Note 8)	30,284	26,457
Investment in associate (Note 17)	57,065	105,065
Total assets	1,878,513	2,664,058
LIABILITIES AND EQUITY (DEFICIENCY)
Current	257,082	522,050
Trade and other payables (Notes 9 and 10)
Total liabilities	257,082	522,050
Equity (Deficiency)	9,457,211	9,457,211
Share capital (Note 11)
Reserve for share-based payments (Note 12)	1,520,700	1,518,000
Reserve for warrants (Note 13)	3,631,775	3,631,775
Accumulated deficit	(12,973,184)	(12,449,271)
Reserve for foreign currency translation	(15,071)	(15,707)
Total equity (deficiency)	1,621,431	2,142,008
Total liabilities and equity (deficiency)	1,878,513	2,664,058

Nature of Operations and Going Concern Uncertainty (Note 1)

Commitments and Contingencies (Note 15 and 16)

On behalf of the Board of Directors on May 30, 2022:

Andrew Thomson	Christina McCarthy
Director	Director

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

PALAMINA CORP.

Unaudited Interim Consolidated Statements of Loss and Comprehensive Loss

(Expressed in Canadian dollars)

	2022	2021
For the three months ended March 31,	$	$
Expenses
Exploration and evaluation expenditures (Note 14 and 10)	335,808	79,588
Salaries, director and management fees (Note 10)	77,287	52,000
Share-based payments (Note 10 and 12)	2,700	-
Investor relations	30,085	-
Regulatory fees	12,902	903
Professional fees	6,630	8,300
Office and general	8,382	7,543
Rent	4,500	4,500
Foreign exchange gain	(516)	(428)
Total expenses	477,778	152,406
Other (income) expense
Interest income	(1,865)	-
Loss from investment in associate (Note 17)	48,000	20,000
Net loss	523,913	172,406
Other comprehensive loss - items that will not subsequently reclassify into income
Exchange on translation of foreign subsidiaries	(636)	(2,631)
Net comprehensive loss	523,277	169,775

Loss per share	0.01	0.00
- basic
0.01	0.00
- diluted
Weighted average number of common shares outstanding	65,284,836	45,284,836
- basic
65,284,836	45,284,836
- diluted

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

PALAMINA CORP.

Unaudited Interim Consolidated Statements of Changes in Equity

(Expressed in Canadian dollars)

	Share Capital
	Number of				Reserve for			Accumulated	Reserve for foreign
		Amount		Share-based		Reserve for		currency		Total
	shares			payments		Warrants		deficit		translation
Balance at December 31, 2020	45,284,836	$	6,480,018	$	1,018,000	$	1,684,775	$	(9,385,170)	$	(11,283)	$	(213,660)
Net loss	-		-		-		-		(172,406)		-		(172,406)
Other comprehensive income	-		-		-		-		-		2,631		2,631
Balance at March 31, 2021	45,284,836	$	6,480,018	$	1,018,000	$	1,684,775	$	(9,557,576)	$	(8,652)	$	(383,435)
Issued pursuant to private placement	20,000,000		5,000,000		-		-		-		-		5,000,000
Warrants issued pursuant to private placement	-		(1,935,000)		-		1,935,000		-		-		-
Broker warrants issued pursuant to private placement	-		(12,000)		-		12,000		-		-		-
Share issue costs	-		(75,807)		-		-		-		-		(75,807)
Share based payments	-		-		500,000		-		-		-		500,000
Net loss	-		-		-		-		(2,891,695)		-		(2,891,695)
Other comprehensive loss	-		-		-		-		-		(7,055)		(7,055)
Balance at December 31, 2021	65,284,836	$	9,457,211	$	1,518,000	$	3,631,775	$	(12,449,271)	$	(15,707)	$	2,142,008
Share based payments	-		-		2,700		-		-		-		2,700
Net loss	-		-		-		-		(523,913)		-		(523,913)
Other comprehensive loss	-		-		-		-		-		636		636
Balance at March 31, 2022	65,284,836	$	9,457,211	$	1,520,700	$	3,631,775	$	(12,973,184)	$	(15,071)	$	1,621,431

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