Giga Metals : Earnings Document

Consolidated Financial Statements

Years Ended December 31, 2023 and 2022

Expressed in Canadian Dollars

Crowe MacKay LLP

1100 - 1177 West Hastings Street

Vancouver, BC V6E 4T5

Main [phone]

Fax [phone]

www.crowemackay.ca

Independent Auditor's Report

To the Shareholders of Giga Metals Corporation

Opinion

We have audited the consolidated financial statements of Giga Metals Corporation (the "Group"), which comprise the consolidated statements of financial position as at December 31, 2023 and December 31, 2022 and the consolidated statements of comprehensive loss, changes in equity and cash flows for the years then ended, and

notes to the consolidated financial statements, including a summary of material accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at December 31, 2023 and December 31, 2022, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board.

Basis for Opinion

We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Material Uncertainty Related to Going Concern

We draw attention to Note 1 to the consolidated financial statements which describes the material uncertainty that may cast significant doubt on the Group's ability to continue as a going concern. Our opinion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the year ended December 31, 2023. In addition to the matter described in the Material Uncertainty Related to Going Concern section, we have determined the matters described below to be a key audit matter to be communicated in our report. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Asset Retirement Obligations

We draw attention to Notes 2 and 8 to the consolidated financial statements. The Group recognizes an asset retirement obligation ("ARO") for future reclamation efforts related to its Turnagain Cobalt Nickel Project.

Why the Matter is a Key Audit Matter

We identified the Group's ARO as a key audit matter due to: (i) the significant judgment and estimate made by management in determining this obligation, including the assessment of the nature and extent of future work to be performed, the future cost of performing the rehabilitation work, and the timing of when the rehabilitation will take place; (ii) a high degree of auditor judgment, subjectivity and effort in performing procedures related to the significant assumptions; and (iii) the audit effort that involved the use of professionals with specialized skill and knowledge in the subject matter.

How the Key Audit Matter was Addressed in the Audit

In responding to the key audit matter, we performed the following audit procedures, amongst others:

• Obtained an understanding of management's process to develop their ARO estimate;
• Engaged a subject matter expert to assist us in evaluating the assumptions, methodology, and data used by the Group;
• Evaluated the methodology used and tested the significant assumptions in the ARO calculations;
• Performed recalculation to verify the accuracy of the estimates; and
• Evaluated the adequacy of the Group's disclosures related to the ARO.

Other Information

Management is responsible for the other information. The other information comprises:

• Management's Discussion and Analysis

Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the consolidated financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.

We obtained the other information prior to the date of this auditor's report. If, based on the work we have performed on this other information, we conclude that there is a material misstatement of this other information, we are required to report that fact in this auditor's report. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Group's financial reporting process.

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be

communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partner on the audit resulting in this independent auditor's report is Diana Huang.

Chartered Professional Accountants

Vancouver, Canada

April 23, 2024

Giga Metals Corporation

Consolidated Statements of Financial Position

As at December 31, 2023 and 2022

(Expressed in Canadian Dollars)

		2023	2022
	Notes	$	$
ASSETS
Current assets
Cash and cash equivalents		1,521,171	7,234,134
Receivables	3,12	97,304	75,097
Prepaid expenses and deposits		143,790	184,878
		1,762,265	7,494,109
Non-current assets
Reclamation deposits		424,000	424,000
Equipment and right of use assets	4	826,979	282,029
Exploration and evaluation assets	5	20,241,768	17,039,792
		21,492,747	17,745,821
TOTAL ASSETS		23,255,012	25,239,930
LIABILITIES
Current liabilities
Trade payables and accrued liabilities	6,12	286,136	613,221
Lease obligation - short-term	7	109,408	92,347
		395,544	705,568
Non-current liabilities
Lease obligation - long-term	7	30,073	139,481
Loan		-	40,000
Asset retirement obligations	8	590,000	485,000
		620,073	664,481
TOTAL LIABILITIES		1,015,617	1,370,049
EQUITY
Share capital	10	68,642,773	68,642,773
Share-based payment reserve	11	11,261,049	10,826,508
Accumulated other comprehensive income ("AOCI")		-	9,838
Accumulated deficit		(60,938,435)	(58,973,630)
TOTAL EQUITY ATTRIBUTABLE TO OWNERS		18,965,387	20,505,489
NON-CONTROLLING INTEREST		3,274,008	3,364,392
TOTAL EQUITY		22,239,395	23,869,881
TOTAL LIABILITIES AND EQUITY		23,255,012	25,239,930

Nature and continuance of operations (Note 1)

Commitments (Note 7)

Subsequent event (Notes 10 and 16)

APPROVED BY:

DIRECTOR

"MARK JARVIS"

DIRECTOR

"LYLE DAVIS"

See accompanying notes to the consolidated financial statements

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Giga Metals Corporation

Consolidated Statements of Comprehensive Loss

For the years ended December 31, 2023 and 2022

Expressed in Canadian Dollars

		2023	2022
	Notes	$	$
Operating expenses
Amortization	4	113,278	105,368
Consulting fees		75,962	264,093
Corporate communications and investor relations		376,116	310,881
Legal, accounting and audit	12	326,846	418,412
Management and directors fees	12	409,642	264,199
Office and general		318,721	340,727
Travel and accommodation		140,028	50,787
Stock-based compensation	10,12	434,541	1,029,860
		2,195,134	2,784,327
Other items
Interest income		(123,137)	(70,380)
Finance charge on lease	7	29,391	14,777
Income from sublease of office	7, 12	(32,664)	(45,544)
Impairment of exploration and evaluation assets	5	5,614	173,417
Gain on loan repayment		(10,000)	-
Gain on sale of subsidiary	5	(9,149)	-
		(139,945)	72,270
Loss for the year		(2,055,189)	(2,856,597)
Other comprehensive income (loss)
Exchange gain (loss) on translation of foreign operations		1,628	13,075
Reclassification of translation gain on sale of subsidiary	5	(11,466)	-
Comprehensive loss for the year		(2,065,027)	(2,843,522)
Loss for the period attributable to:
Owners of the parent company		(1,964,805)	(2,857,579)
Non-controlling interest		(90,384)	982
		(2,055,189)	(2,856,597)
Comprehensive loss for the period attributable to:
Owners of the parent company		(1,974,643)	(2,844,504)
Non-controlling interest		(90,384)	982
		(2,065,027)	(2,843,522)
Loss per share attributable to the owners of the parent
company - basic and diluted	10	(0.02)	(0.03)
Weighted average number of shares outstanding - basic
and diluted	10	97,904,128	96,611,795

See accompanying notes to the consolidated financial statements

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Giga Metals Corporation

Consolidated Statement of Changes in Equity

For the years ended December 31, 2023 and 2022

Expressed in Canadian Dollars

		Share capital
							Total
				Share-based			equity	Non-
		Number of		payment		Accumulated	attributable	controlling	Total
		shares	Amount	reserve	AOCI(L)	deficit	to owners	interest	equity
	Notes	#	$	$	$	$	$	$	$
Balance at December 31, 2021		85,653,428	65,238,663	9,567,417	(3,237)	(60,752,641)	14,050,202	-	14,050,202
Public offering of units	10	12,075,700	3,984,981	120,757	-	-	4,105,738	-	4,105,738
Share issuance costs
Cash finders' fees	10	-	(246,344)	-	-	-	(246,344)	-	(246,344)
Brokers' warrants	10	-	(145,849)	145,849	-	-	-	-	-
Other fees	10	-	(284,803)	-	-	-	(284,803)	-	(284,803)
Exercise of options	10	175,000	58,750	-	-	-	58,750	-	58,750
Transfer on the exercise of options		-	37,375	(37,375)	-	-	-	-	-
Stock-based compensation	10	-	-	1,029,860	-	-	1,029,860	-	1,029,860
Issuance of 15% common shares in Hard
Creek Nickel Corp.	5	-	-	-	-	4,636,590	4,636,590	3,363,410	8,000,000
Comprehensive loss for the year		-	-	-	13,075	(2,857,579)	(2,844,504)	982	(2,843,522)
Balance at December 31, 2022		97,904,128	68,642,773	10,826,508	9,838	(58,973,630)	20,505,489	3,364,392	23,869,881
Stock-based compensation	10	-	-	434,541	-	-	434,541	-	434,541
Comprehensive loss for the year		-	-	-	(9,838)	(1,964,805)	(1,974,643)	(90,384)	(2,065,027)
Balance at December 31, 2023		97,904,128	68,642,773	11,261,049	-	(60,938,435)	18,965,387	3,274,008	22,239,395

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See accompanying notes to the consolidated financial statements

Giga Metals Corporation

Consolidated Statements of Cash Flows

For the years ended December 31, 2023 and 2022

Expressed in Canadian Dollars

	2023	2022
	$	$
Operating activities
Loss for the year	(2,055,189)	(2,856,597)
Adjustments for:
Amortization	113,278	105,368
Stock-based compensation	434,541	1,029,860
Impairment of exploration and evaluation assets	5,614	173,417
Gain on loan repayment	(10,000)	-
Gain on sale of subsidiary	(9,149)	-
Changes in non-cash working capital items:
Receivables	(22,527)	19,489
Prepaid expenses and deposits	38,729	(24,543)
Trade payables and accrued liabilities	51,443	(5,325)
Net cash flows used in operating activities	(1,453,260)	(1,558,331)
Investing activities
Expenditures on exploration and evaluation assets	(3,444,606)	(4,433,454)
British Columbia mining tax credits	34,267	201,337
Purchase of equipment	(727,018)	(4,151)
Sale of subsidiary	1	-
Net cash flows used in investing activities	(4,137,356)	(4,236,268)
Financing activities
Proceeds from issuance of common shares	-	4,164,488
Share issuance costs	-	(531,147)
Proceeds from issuance of common shares of Hard Creek
Nickel Corp.	-	8,000,000
Principal repayment of lease obligation	(92,347)	(97,973)
Repayment of loan	(30,000)	-
Net cash flows (used in) provided by financing activities	(122,347)	11,535,368
(Decrease) increase in cash and cash equivalents	(5,712,963)	5,740,769
Cash and cash equivalents, beginning	7,234,134	1,493,365
Cash and cash equivalents, ending	1,521,171	7,234,134
Cash	1,492,421	7,205,384
Cash equivalents	28,750	28,750
	1,521,171	7,234,134
Cash received for interest	123,137	70,208
Cash paid for interest	29,391	15,536
Cash paid for taxes	-	-

Supplemental cash flow information (Note 14)

See accompanying notes to the consolidated financial statements

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Giga Metals Corporation

Notes to the Consolidated Financial Statements

Expressed in Canadian Dollars

For the years ended December 31, 2023 and 2022

1. Nature and continuance of operations
   Giga Metals Corporation (the "Company" or "Giga Metals") was incorporated on January 17, 1983, under the laws of the province of British Columbia, Canada, and its principal activity is the acquisition and exploration of mineral properties in Canada. The Company's common shares are listed for trading on the TSX Venture Exchange ("TSXV") under the symbol "GIGA" and the OTCQX under the symbol "GIGGF". 13,667,755 warrants of the Company commenced trading on the TSXV under the symbol "GIGA.WT" effective May 27, 2021. The warrants were issued under a warrant indenture dated April 23, 2021 pursuant to the Company's short form prospectus dated April 19, 2021. 12,535,000 warrants of the Company commenced trading on the TSXV under the symbol
   "GIGA.WT.A" effective February 23, 2022.
   The head office, principal address and records office of the Company are located at 700 West Pender Street, Suite 203, Vancouver, British Columbia, Canada, V6C 1G8. The Company's registered address is 2500 Park Place, 666 Burrard Street, Vancouver, British Columbia, Canada, V6C 2X8.
   These consolidated financial statements have been prepared on the assumption that the Company and its subsidiaries will continue as a going concern, meaning it will continue in operation for the foreseeable future and will be able to realize assets and discharge liabilities in the ordinary course of operations. As at December 31, 2023, the Company's accumulated deficit was $60,938,435, the Company had not advanced its mineral properties to commercial production and the Company has no other source of revenue from its operations. The Company's continuation as a going concern is dependent upon the successful results from its mineral property exploration activities and its ability to attain profitable operations and generate funds there from and/or raise equity capital or borrowings sufficient to meet current and future obligations. These material uncertainties may cast significant doubt upon the Company's ability to continue as a going concern. As at December 31, 2023, the Company had working capital of $1,366,721, giving the Company the ability to meet current obligations.
   The Company's business may be affected by changes in political and market conditions, such as interest rates, availability of credit, inflation rates, changes in laws, and national and international circumstances. Recent regional conflicts and potential economic global challenges such as the risk of higher inflation and energy crises, may create further uncertainty and risk with respect to the prospects of the Company's business.
2. Material accounting policies and basis of preparation
   These consolidated financial statements were authorized for issue on April 23, 2024 by the directors of the Company.
   Statement of compliance with International Financial Reporting Standards
   The consolidated financial statements of the Company comply with IFRS Accounting Standards
   ("IFRS") as issued by the International Accounting Standards Board ("IASB").
   Basis of preparation
   The consolidated financial statements of the Company have been prepared on an accrual basis and are based on historical costs, modified where applicable. The consolidated financial statements are presented in Canadian dollars unless otherwise noted.

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