Stillwater Critical Minerals : Earnings Report

CONDENSED INTERIM CONSOLIDATED FINANCIAL

STATEMENTS

FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2023 AND 2022

(Unaudited - Expressed in Canadian Dollars)

NOTICE OF NO AUDITOR REVIEW

Under National Instrument 51-102, Part 4, subsection 4.3(3) (a), if an auditor has not performed a review of the interim financial statements, they must be accompanied by a notice indicating that the financial statements have not been reviewed by an auditor.

The accompanying unaudited interim financial statements of the Company have been prepared by and are the responsibility of the Company's management.

The Company's independent auditor has not performed a review of these financial statements in accordance with standards established by the Chartered Professional Accountants Canada for a review of interim financial statements by an entity's auditor.

STILLWATER CRITICAL MINERALS CORP.

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited - Expressed in Canadian Dollars)

		December 31,	March 31,
	Note	2023	2023
		$	$
ASSETS
Current
Cash		340,537	27,387
Accounts receivable		24,593	50,406
Prepaid expenses and deposits	4	191,283	211,148
Due from related parties	9b	658,667	773,744
Marketable securities	5, 6d	619,856	390,000
		1,834,936	1,452,685
Non-current
Deposits	4	307,135	262,153
Exploration and evaluation assets	6	3,279,689	3,040,803
		5,421,760	4,755,641
LIABILITIES
Current
Accounts payable and accrued liabilities		225,926	260,437
Due to related parties	9b	50,750	206,468
		276,676	466,905
SHAREHOLDERS' EQUITY
Share capital	8	39,167,734	34,895,103
Share-based payment reserve	8f	3,621,882	2,828,222
Deficit		(37,644,532)	(33,434,589)
		5,145,084	4,288,736
		5,421,760	4,755,641
Nature of Operations and Going Concern - Note 1

Approved on behalf of the Board:

Michael Rowley	, Director
Greg Johnson	,Director

See accompanying notes to the condensed interim consolidated financial statements

Page 3 of 22

STILLWATER CRITICAL MINERALS CORP.

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2023 AND 2022

(Unaudited - Expressed in Canadian Dollars)

		Three months ended	Nine months ended
			December 31,		December 31,
	Note	2023	2022	2023	2022
		$	$	$	$
EXPENSES
Consulting	9a	201,088	284,280	612,417	726,921
Exploration expenditures	7	438,922	201,821	3,027,593	1,280,320
Investor relations and corporate
development		113,647	82,703	304,234	287,780
Office and administration		47,196	61,439	130,735	113,526
Professional fees		31,713	63,932	109,022	199,413
Property evaluation		27	-	833	-
Share-based payment expense	8f, 9a	158,777	224,431	506,175	698,795
Transfer agent, regulatory and filing fees		7,686	16,177	32,350	40,781
Travel and accommodation		3,155	3,568	33,553	38,005
		(1,002,211)	(938,351)	(4,756,912)	(3,385,541)
Other Items
Interest income		5,314	3,074	30,244	8,459
Unrealized loss on marketable securities	5, 6d	(45,750)	(215,000)	(221,250)	(341,000)
Gain on exploration and evaluation asset	5, 6d	451,106	254,500	451,106	375,560
NET LOSS AND COMPREHENSIVE LOSS
FOR THE PERIOD		(591,541)	(895,777)	(4,496,812)	(3,342,522)
Basic and diluted loss per share		(0.00)	(0.01)	(0.02)	(0.02)
Weighted average number of shares		197,786,398	177,392,243	191,250,557	173,414,252
outstanding

See accompanying notes to the condensed interim consolidated financial statements

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STILLWATER CRITICAL MINERALS CORP.

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

(Unaudited - Expressed in Canadian Dollars)

				Share-based
		Common	Share	Payment
	Note	shares	Capital	reserve	Deficit	Total
		number	$	$	$	$
Balance, March 31, 2022		169,611,274	33,297,725	2,174,863	(29,157,672)	6,314,916
Shares issued pursuant to exercise of warrants	8b	6,351,871	1,369,289	(21,996)	-	1,347,293
Shares issued pursuant to exercise of options	8b	1,429,100	228,089	(191,489)	-	36,600
Share-based payment expense	8f	-	-	698,795	-	698,795
Reclass of cancelled options	8f	-	-	(9,080)	9,080	-
Net loss and comprehensive loss		-	-	-	(3,342,522)	(3,342,522)
Balance, December 31, 2022		177,392,245	34,895,103	2,651,093	(32,491,114)	5,055,082
Share-based payment expense		-	-	197,686	-	197,686
Reclass of cancelled options		-	-	(20,557)	20,557	-
Net loss and comprehensive loss		-	-	-	(964,032)	(964,032)
Balance, March 31, 2023		177,392,245	34,895,103	2,828,222	(33,434,589)	4,288,736
Private placement, net of issuance costs	8b	19,758,861	4,056,631	790,354	-	4,846,985
Shares issued pursuant to exercise of RSUs	8b	635,294	216,000	(216,000)	-	-
Share-based payment expense	8f	-	-	506,175	-	506,175
Reclass of cancelled/expired options	8f	-	-	(122,323)	122,323	-
Reclass of expired warrants	8f	-	-	(139,179)	139,179	-
Reclass of expired compensation options	8f	-	-	(25,367)	25,367	-
Net loss and comprehensive loss		-	-	-	(4,496,812)	(4,496,812)
Balance, December 31, 2023		197,786,400	39,167,734	3,621,882	(37,644,532)	5,145,084

See accompanying notes to the condensed interim consolidated financial statements

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STILLWATER CRITICAL MINERALS CORP.

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2023 AND 2022

(Unaudited - Expressed in Canadian Dollars)

		Three months ended	Nine months ended
			December,	December 31,
	Note	2023	2022	2023	2022
		$	$	$	$
Operating activities
Net loss for the period		(591,541)	(895,777)	(4,496,812)	(3,342,522)
Items not involving cash
Share-based payment expense	8f	158,777	224,431	506,175	698,795
Unrealized loss on marketable securities	5, 6d	45,750	215,000	221,250	341,000
Gain on exploration and evaluation asset	5, 6d	(451,106)	(254,500)	(451,106)	(375,560)
		(838,120)	(710,846)	(4,220,493)	(2,678,287)
Net change in non-cash working capital items	10	(578,546)	(70,968)	(74,456)	(530,124)
Cash used in operating activities		(1,416,666)	(781,814)	(4,294,949)	(3,208,411)
Investing activities
Acquisition of exploration and evaluation assets		(1,861)	-	(238,886)	(223,870)
Option Payment received		-	150,000	-	150,000
		(1,861)	150,000	(238,886)	(73,870)
Financing activities
Proceeds from private placement	8b	-	-	4,939,715	-
Share issue costs	8b	-	-	(92,730)	-
Proceeds on exercise of warrants	8b	-	-	-	1,347,293
Proceeds on exercise of options	8b	-	-	-	36,600
Cash provided by financing activities		-	-	4,846,985	1,383,893
Change in cash		(1,418,527)	(631,814)	313,150	(1,898,388)
Cash, beginning of the period		1,759,064	1,135,391	27,387	2,401,965
Cash, end of the period		340,537	503,577	340,537	503,577

Supplemental cash flow information (Note 10)

See accompanying notes to the condensed interim consolidated financial statements

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STILLWATER CRITICAL MINERALS CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2023 AND 2022

(Unaudited - Expressed in Canadian Dollars)

1. NATURE OF OPERATIONS AND GOING CONCERN

Stillwater Critical Minerals Corp. (the "Company") is a publicly listed company on the TSX Venture exchange ("TSX-V"), incorporated under the laws of British Columbia, Canada on April 28, 2006. The Company's principal business activities include the acquisition and exploration of mineral properties. The Company's registered office is 904-409 Granville Street, Vancouver, British Columbia, Canada, V6C 1T2. On June 13, 2022, the Company changed its name from Group Ten Metals Inc. to Stillwater Critical Minerals Corp.

These condensed interim consolidated financial statements have been prepared using International Financial Reporting Standards ("IFRS") applicable to a going concern, which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The ability of the Company to continue as a going concern is dependent on its ability to obtain additional equity financing and achieve profitable operations. The Company has sustained losses from operations and has an ongoing requirement for capital investment to acquire and explore its mineral properties.

The Company incurred a net loss of $4,496,812 for the nine months ended December 31, 2023 (2022 - $3,342,522), and as of that date, had an accumulated deficit of $37,644,532 (March 31, 2023 - $33,434,589). At December 31, 2023, the Company had a total of $1,834,936 (March 31, 2023 - $1,452,685) in current assets and a working capital of $1,558,260 (March 31, 2023 - $985,780) and no long-term debt.

While the Company has been successful in obtaining the necessary financing to cover its corporate operating costs and advance the development of its projects through the issuance of common shares and the exercise of warrants in the past, there is no assurance it will be able to raise funds in this manner in the future. There remain material uncertainties that may cast significant doubt as to the Company's ability to continue as a going concern. These consolidated financial statements do not give effect to adjustments that would be necessary should the Company be unable to continue as a going concern.

2. BASIS OF PREPARATION Statement of compliance

The Company's consolidated financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") applicable to the preparation of interim financial statements, including IAS34, Interim Financial Reporting. The condensed interim consolidated financial statements should be read in conjunction with the annual consolidated financial statements for the year ended March 31, 2023, which have been prepared in accordance with IFRS. These condensed interim consolidated financial statements were prepared on a historical cost basis using the accrual basis of accounting, except for cash flow information.

The Company uses the same accounting policies and methods of computation as in the annual consolidated financial statements for the year ended March 31, 2023.

These financial statements were approved by the board of directors on February 29, 2024.

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STILLWATER CRITICAL MINERALS CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2023 AND 2022

(Unaudited - Expressed in Canadian Dollars)

Basis of consolidation

The condensed interim consolidated financial statements include the results or financial information of Stillwater Critical Minerals Corp. and its wholly-owned subsidiaries listed in the following table:

	Country of
Name	incorporation
Yankee Girl Resources Corp	Canada
Group Ten (USA) Inc	USA
Group Ten (Alaska) Inc	USA
1161932 BC Ltd	Canada
1326267 BC Ltd	Canada
1326271 BC Ltd	Canada

The results of each subsidiary will continue to be included in the consolidated financial statements of the Company until the date that the Company's control over the subsidiary ceases. All significant intercompany transactions and balances have been eliminated.

1. USE OF ESTIMATES, ASSUMPTIONS AND JUDGEMENTS
   In preparing these condensed interim consolidated financial statements, the significant judgements made by management in applying the group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial statements for the year ended March 31, 2023.
2. PREPAID EXPENSES AND DEPOSITS

	December 31,	March 31,
	2023	2023
	$	$
Prepaid expenses	71,956	32,746
Deposits	426,462	440,555
	498,418	473,301
Less: non-current portion	(307,135)	(262,153)
	191,283	211,148

In June 2021, the Company re-engaged Earth Labs (Formerly Goldspot Discoveries Corp.) to continue to assist the Company in identifying preferential environments for precious and base metal mineralization on the Company's properties by utilizing its proprietary technology which includes the use of artificial intelligence. A payment of $140,000 was made upon engagement and as at December 31, 2023 a total of $43,023 was drawn down. The Company has engaged other consultants on the Company's Stillwater West project and made total deposits of $276,791 and a total of $254,441 was drawn down as at December 31, 2023.

The Company has paid $278,170 (March 31, 2023 - $233,188) for bonds in relation to the Company's Stillwater West project and a deposit of $28,965 (March 31, 2023 - $28,965) has been made in relation to a corporate credit card.

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STILLWATER CRITICAL MINERALS CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2023 AND 2022

(Unaudited - Expressed in Canadian Dollars)

5. MARKETABLE SECURITIES
	December 31,	March 31,
	2023	2023
	$	$
Beginning balance	390,000	-
Addition	451,106	594,500
Unrealized loss on marketable securities	(221,250)	(204,500)
	619,856	390,000

The Company's accounting policy for marketable securities is to hold the common shares at fair value through profit or loss ("FVTPL") with any unrealized gains and losses being recorded in the consolidated statement of comprehensive loss.

On September 1, 2022, and November 25, 2022, a total of 2,800,000 and 1,100,000 common shares of Heritage Mining Ltd. were received, respectively, by the Company pursuant to the Definitive Earn-In Agreement (Note 6(d)). The common shares were initially valued at $490,000 and $104,500 respectively. As at March 31, 2023 the 3,900,000 common shares held by the Company resulted in an unrealized loss of $204,500.

On November 24, 2023, a total of 1,350,000 common shares were received by the Company pursuant to an Amended and Restated Agreement of the Definitive Earn-In Agreement (Note 6(d)). The common shares were initially valued at $67,500.

The Company recorded an additional 6,000,000 common shares and 6,000,000 warrants on December 31, 2023 pursuant to an Amended and Restated Amendment Agreement of the Definitive Earn-In Agreement (Note 6(d). The common shares were valued at $270,000 and the warrants were valued at $113,606 using the Black-Scholes option pricing model with the following weighted average assumptions: risk-free interest rate 3.88%; expected life in years: 2 years; expected volatility: 100.0% and expected dividends: 0.0%. The shares and warrant certificates were received subsequent to December 31, 2023. At December 31, 2023, the 11,250,000 common shares and 6,000,000 warrants held by the Company resulted in an unrealized loss of $221,250.

6. EXPLORATION AND EVALUATION ASSETS

Exploration and evaluation acquisition costs for the nine months ended December 31, 2023 and year ended March 31, 2023 were as follows:

	Montana	Yukon	Alaska	Ontario
	Stillwater	Kluane	Duke	Drayton
	West	Project	Island	Black Lake	Total
	$	$	$	$	$
Balance, March 31, 2022	1,923,645	777,026	109,471	368,940	3,179,082
Cash payments	63,370	-	-	-	63,370
Licenses and permits	160,500	-	6,791	-	167,291
Shares received	-	-	-	(368,940)	(368,940)
Balance, March 31, 2023	2,147,515	777,026	116,262	-	3,040,803
Cash payments	67,658	-	-	-	67,658
Licenses and permits	169,367	-	1,861	-	171,228
Balance, December 31, 2023	2,384,540	777,026	118,123	-	3,279,689

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STILLWATER CRITICAL MINERALS CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2023 AND 2022

(Unaudited - Expressed in Canadian Dollars)

1. Stillwater West (Montana, United States)
   During the year ended March 31, 2021, the Company satisfied all earn-in requirements and owns 100% of the Stillwater West project. On June 26, 2017, the Company entered into an option agreement to acquire a 100% interest in the Stillwater West project from Picket Pin Resources LLC, a private entity, consisting of 282 claims in south central Montana, USA, covering approximately
   22 square kilometers ("km2") in two claim groups. In consideration, the Company agreed to:
2. • Issue a total of 3,600,000 shares of the Company beginning with 900,000 shares within ten days of regulatory approval (issued) and 900,000 shares on or before May 31 of each of 2018 (issued), 2019 (issued - valued at $112,500) and 2020 (issued - valued at $216,000);
   • Make United States dollars ("USD") $40,000 in cash payments with USD$20,000 on or before each of May 31, 2018 (paid) and 2019 (paid - CDN $26,600);
   • Make advance royalty payments until commencement of commercial production of USD$15,000 within ten days of regulatory approval (paid), USD$30,000 on or before May 31, 2018 (paid) and USD$50,000 on or before May 31, 2019 (paid - CDN$66,500) and thereafter USD$50,000 annually (paid May 31, 2020 - CDN$67,654, June 17, 2021 - CDN$61,900, June 1, 2022 - CDN$63,370 and July 6, 2023 - CDN$67,658); and
   • Execute a work contract for a minimum of USD$50,000 per year for the duration of the option agreement for technical and management work, which is three years (completed).

The project is subject to a 2% Net Smelter Return royalty ("NSR") and the Company has an option to buy down the NSR to 1%.

Pursuant to further staking from November 2017 to present, the Company's land holdings at the Stillwater West project have increased to approximately 61 km2 consisting of 763 claims.

1. Kluane PGE-Ni-Cu Project (Yukon, Canada)
   The Company owns a 100% interest in four platinum group and battery metals properties totaling over 255 km2 in the Kluane Ultramafic Belt in southwestern Yukon. Together, these properties comprise the Kluane PGE-Ni-Cu project.
   Catalyst
   The Company earned its 100% interest in the Catalyst property on December 5, 2019 by completing the following commitments:
2. • Pay $10,000 to Progressive Planet Solutions Inc. ("Progressive" - formerly Ashburton Ventures Inc.) on or before December 29, 2017. The agreement was amended and in lieu of the cash payment, the Company issued 200,000 common shares to Progressive (issued
   • • valued at $26,000); and
   • Issue 300,000 common shares to Denali Resources Ltd. on or before July 31, 2019 (issued
   • • valued at $52,500).

Certain claims on the Catalyst property are subject to a 3% NSR and the Company has an option to buy the NSR down to 1%.

The Catalyst property also includes claims previously referred to as the CKR claims.

Spy

The Company owns a 100% interest in the Spy property. The Spy claims are subject to a 3% NSR and the Company has an option to buy the NSR down to 1%.

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