Starrex International : Interim Consolidated Financial Statements for the period ended June 30, 2022

Condensed Interim Consolidated Financial Statements

Three and Six Months Ended June 30, 2022 and 2021

(Unaudited) (expressed in U.S. dollars)

Management's Responsibility for

Condensed Interim Consolidated Financial Statements

The accompanying unaudited condensed interim consolidated financial statements of Starrex International Ltd. (the "Company" or "Starrex") are the responsibility of the Board of Directors.

The unaudited condensed 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 audited consolidated financial statements as at December 31, 2021. Where necessary, management has made informed judgments and estimates in accounting for transactions which were not complete at the end of the reporting period. In the opinion of management, the unaudited condensed interim consolidated financial statements have been prepared within acceptable limits of materiality and are in accordance with International Accounting Standard 34 Interim Financial Reporting using accounting policies consistent with International Financial Reporting Standards appropriate in the circumstances.

Management has established processes, which are in place to provide it sufficient knowledge to support management representations that it has exercised reasonable diligence that (i) the unaudited condensed interim consolidated financial statements do not contain any untrue statement of material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it is made, as of the date of, and for the periods presented by, the unaudited condensed interim consolidated financial statements and (ii) the unaudited condensed interim consolidated financial statements fairly present in all material respects the financial condition, financial performance and cash flows of the Company, as of the date of and for the periods presented by the unaudited condensed interim consolidated financial statements.

The Board of Directors is responsible for reviewing and approving the unaudited condensed 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 condensed 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 condensed 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.

(Signed): "Dr. Deborah Merritt"

Chief Financial Officer

Calgary, Canada

August 29, 2022

NOTICE TO READER

The accompanying unaudited condensed interim consolidated financial statements of the Company have been prepared by and are the responsibility of management. These unaudited condensed interim consolidated financial statements as at, and for the three and six months ended June 30, 2022 and 2021, have not been reviewed by the Company's auditors.

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Starrex International Ltd.

Condensed Interim Consolidated Statements of Financial Position (Unaudited) (Expressed in U.S. dollars)

		June 30,		December 31,
		2022		2021
ASSETS
Current Assets	$	1,765,207
Cash	$	2,172,169
Accounts receivable		880,111		992,155
Prepaid expenses		129,284		113,209
Non-current assets		2,774,602		3,277,533
	323,755
Property and equipment, net of depreciation (Note 6)			318,235
Intangible assets (Note 7)		822,413		898,093
Goodwill		915,288		915,288
Right-of-use assets (Note 8)		232,581		289,895
Total assets	$	5,068,639	$	5,699,044
LIABILITIES
Current Liabilities	$	859,840
Accounts payable and accrued liabilities	$	1,350,086
Contract liabilities (Note 10)		557,795		580,372
Current portion of lease liabilities (Note 8)		106,039		91,501
Non-current Liabilities		1,523,674		2,021,959
	133,547
Lease liabilities (Note 8)			206,879
Total liabilities	$	1,657,221	$	2,228,838
Shareholders' equity		7,707,501
Share capital (Note 12)			7,707,501
Contributed surplus (Note 13)		390,136		390,136
Accumulated other comprehensive income		(261,534)		(261,534)
Deficit		(4,424,685)		(4,365,897)
Total equity		3,411,418		3,470,206
Total liabilities and equity	$	5,068,639	$	5,699,044

Commitment (Note 18)

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

Signed: Matthew D. Hill		Signed: Scott M. Reeves
Chairman		Director
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Starrex International Ltd.

Condensed Interim Consolidated Statements of Income (loss) and Comprehensive Income

For the periods ended June 30, 2022 and 2021

(Unaudited) (Expressed in U.S. dollars)

	Three Months Ended	Six Months Ended
	2022		June 30	2022		June 30
		2021		2021
Income	$4,424,486			$9,283,930
Revenue from contracts with customers (Note 11)	$5,427,431	$10,523,165
Consulting fees	37.500		-	50,000		-
	4,461,986	5,427,431	9,333,930	10,523,165
Expenses	2,920,162			6,234,151
Transaction costs	3,671,723		7,080,559
Payroll expense	667,914		712,052	1,351,854		1,320,731
General and administrative	440,786		460,538	925,986		917,474
Professional fees	299,536		118,619	467,530		187,747
Management and corporate services (Note 9)	102,640		52,640	205,280		105,280
Depreciation and amortization (Notes 6, 7 and 8)	83,760		89,518	167,510		178,804
Shareholder services	1,466		2,887	3,576		14,375
Government, regulatory and filing fees	6,349		7,353	12,573		13,329
Interest expense	3.910		1,195	8,259		3,087
	4,526,523	5,116,525	9,376,719		9,821,386
Income (loss) before provision for income taxes	(64,537)		310,906	(42,789)		701,779
Income tax expense	-		33,181	15,999		56,261
Net income and comprehensive income for the period	(64,637)	$ 277,725	(58,788)	$	645,519
Basic net income (loss) per share	(0.00)	$	0.02	0.00	$	0.04
Diluted net income (loss) per share	(0.00)	$	0.02	0.00	$	0.04
Basic weighted average number
of common shares outstanding (Note 14)	15,752,525	15,635,539	15,572,525	15,635,539
Diluted weighted average number
of common shares outstanding (Note 14)	15,752,525	15,737,879	15,572,525	15,737,879

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

Starrex International Ltd.

Condensed Interim Consolidated Statements of Changes in Equity For the six-monthperiods ended June 30, 2022 and 2021 (Unaudited) (Expressed in U.S. dollars)

									Accumulated
									Other
	Number of				Contributed				Comprehensive
	Shares		Value		Surplus		Deficit		Income		Total
Balance, December 31, 2020	15,552,525	$	7,519,769	$	491,118	$	(4,900,457)	$	(261,534)	$	2,848,896
Options exercised (Note 13)	200,000		187,732		(100,982)		-		-		86,750
Net income for the period	-		-		-		645,519		-		645,519
Balance, June 30, 2021	15,752,525	$	7,707,501	$	390,136	$	(4,254,938)	$	(261,534)	$	3,581,165
Balance, December 31, 2021	15,752,525	$	7,707,501	$	390,136	$	(4,365,897)	$	(261,534)	$	3,470,206
Net loss for the period	-		-		-		(58,788)		-		(58,788)
Balance, June 31, 2022	15,752,525	$	7,707,501	$	390,136	$	(4,424,685)	$	(261,534)	$	3,411,418

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

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