Austin Resources Ltd. — Interim / Quarterly Report 2020

May 28, 2020

AUSTIN RESOURCES LTD. CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

THREE MONTHS ENDED MARCH 31, 2020 (EXPRESSED IN CANADIAN DOLLARS) (UNAUDITED)

Notice To Reader

The accompanying unaudited condensed interim consolidated financial statements of Austin Resources Ltd. (the "Company") have been prepared by and are the responsibility of management. The unaudited condensed interim consolidated financial statements have not been reviewed by the Company's auditors.

Austin Resources Ltd.

Condensed Interim Consolidated Statements of Financial Position (Expressed in Canadian Dollars) (Unaudited)

		As at		As at
		March 31,		December 31,
		2020		2019
ASSETS
Current assets
Cash and cash equivalents	$	35,011	$	82,614
Amounts receivable		3,708		2,070
Prepaid expenses		-		1,560
Assets held for sale		13,059		-
Total current assets		51,778		86,244
Non-current assets
Equipment(note 5)		-		71
Total assets	$	51,778	$	86,315
EQUITY (DEFICIENCY) AND LIABILITIES
Current liabilities
Accounts payable and accrued liabilities (note 10)	$	36,604	$	27,472
Related party loan (notes 6 and 10)		104,904		102,411
Liabilityrelated to assets held for sale		10,505		-
Total liabilities		152,013		129,883
Deficiency
Issued capital (note 7)		6,144,075		6,144,075
Deficit		(6,244,310)		(6,187,643)
Total deficiency		(100,235)		(43,568)
Total deficiency and liabilities	$	51,778	$	86,315

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

Nature of operations and going concern (note 1) Commitments and contingencies (notes 3 and 13)

Approved on behalf of the Board:

"Weimin Fu", Director

"Jiangping Mo", Director

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Austin Resources Ltd.

Condensed Interim Consolidated Statements of Loss and Comprehensive Loss (Expressed in Canadian Dollars) (Unaudited)

	Three months	Three months	Three months	Three months
		ended		ended
		March 31,		March 31,
		2020		2019
Operating expenses
Consulting and management fees (note 10(a))	$	6,085	$	5,953
Professional fees (note 10(b))		15,867		9,672
Office expense		-		128
Interest expense (note 6)		2,493		12,329
Shareholder communication and filing fees		8,713		5,835
Bank charges		589		593
Depreciation expense		-		-
Loss for the period before other items		(33,747)		(34,510)
Foreign exchange(loss) gain		(334)		(137)
Net loss and comprehensive
loss for continuing operation for the period		(34,081)		(34,647)
Net loss and comprehensive
loss for discontinued operation for theperiod		(22,586)		(18,384)
Total Net loss and comprehensive
loss for theperiod	$	(56,667)	$	(53,031)
Basic and diluted net loss
per share (note 11)	$	(0.00)	$	(0.00)
Weighted average number of common shares outstanding - basic and diluted		21,346,618		8,846,618

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

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Austin Resources Ltd.

Condensed Interim Consolidated Statements of Cash Flows (Expressed in Canadian Dollars) (Unaudited)

	Three months	Three months	Three months	Three months
		ended		ended
		March 31,	March 31,
		2020		2019
Operating activities
Net loss for the period	$	(34,081)	$	(34,647)
Adjustments for:
Accrued interest expense		2,493		12,329
Changes in non-cash working capital items:
Amounts receivable		(2,122)		861
Accountspayable and accrued liabilities		13,569		292
Net cash used in operating activities		(20,141)		(21,165)
Investing activities
Investment in discontinued operation		(20,077)		(13,885)
Net cash used in investing activities		(20,077)		(13,885)
Net change in cash and cash equivalents, continuing operation		(40,218)		(35,050)
Cash and cash equivalents, beginning ofperiod, continuing operation		75,229		97,316
Cash and cash equivalents, end ofperiod, continuing operation	$	35,011	$	62,266
Net cash used in operating activities	$	(16,427)	$	(18,458)
Net cashprovided by financing activities		20,077		13,885
Net change in cash and cash equivalents, discontinued operation		3,650		(4,573)
Cash and cash equivalents, beginning ofperiod, discontinued operation		7,385		6,176
Cash and cash equivalents, end ofperiod, discontinued operation	$	11,035	$	1,603

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

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Austin Resources Ltd.

Condensed Interim Consolidated Statements of Changes in Equity (Deficiency) (Expressed in Canadian Dollars) (Unaudited)

	Number of		Issued
	shares		capital	Deficit	Total
Balance, December 31, 2018	8,846,618	$	5,448,187	$ (6,003,332) $	(555,145)
Net loss and comprehensive loss for theperiod	-		-	(53,031)	(53,031)
Balance, March 31, 2019	8,846,618	$	5,448,187	$ (6,056,363) $	(608,176)
Balance, December 31, 2019	21,346,618	$	6,144,075	$ (6,187,643) $	(43,568)
Net loss and comprehensive loss for theperiod	-		-	(56,667)	(56,667)
Balance, March 31, 2020	21,346,618	$	6,144,075	$ (6,244,310) $	(100,235)

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

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Austin Resources Ltd. Notes to Condensed Interim Consolidated Financial Statements Three Months Ended March 31, 2020 (Expressed in Canadian Dollars) (Unaudited)

1. Nature of operations and going concern

Austin Resources Ltd. (individually, or collectively with its subsidiary, as applicable, “Austin Resources”, or the “Company”) recently completed the sale of all of its properties in Chile, and as a result of the transaction, the Company did not maintain the requirements for a TSX Venture Tier 2 company and its listing was transferred to the NEX board of the TSX Venture Exchange (the "NEX"). While the Company currently holds no mineral properties, it retains its classification as a ‘Mineral Exploration/Development’ company.

The Company’s head office and principal address in Canada is The Canadian Venture Building, 82 Richmond St East, Suite 204, Toronto, Ontario, M5C 1P1.

On February 27, 2020, the Company transferred all of its interest in the mineral exploration properties in Chile held by Minera Azul. The Company retained a 1% net smelter royalty on its interest transferred with 50% of such royalty retained being able to be acquired for US$63,166. As a result of the completion of the agreement with Bluerock Resources SPA, Minera Azul will no longer have any assets and the Company intends to wind-up operations in Chile and dispose of its interest in Minera Azul.

Additionally, the Company had been advised by the Exchange that, with the closing of the transfer of all of its interests in the mineral exploration properties in Chile, the Company ceased to have active operations, no longer met the continued listing requirements of the Exchange and was transferred to the NEX. As a result of such transfer to the NEX, the Company’s trading symbol changed from AUT to AUT.H .

These unaudited condensed interim consolidated financial statements have been prepared on a going concern basis, which assumes that the Company will be able to meet its obligations and continue its operations for its next fiscal year. Realization values may be substantially different from the carrying values as shown. As at March 31, 2020, the Company had not yet achieved profitable operations, had accumulated losses of $6,244,310 (December 31, 2019 - accumulated losses of $6,187,643) since inception, had working capital deficiency of $100,235 (December 31, 2019 - working capital deficiency of $43,639) and expects to incur further losses in the development of its business, all of which constitutes a material uncertainty which casts significant doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon its ability to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. There is no assurance that these funds will be available on terms acceptable to the Company or at all. These unaudited condensed interim consolidated financial statements do not give effect to adjustments that would be necessary to the carrying values and classification of assets and liabilities should the Company be unable to continue as a going concern. Such adjustments could be material.

On July 2, 2019, the Company received approval of its shareholders and the approval of the TSX Venture Exchange for its previously announced share consolidation ("Share Consolidation"). As a result, the common shares of the Company were consolidated on a five for one (5:1) basis. The Share Consolidation has been retrospectively reflected in these consolidated financial statements and all references to the number of common shares herein have been revised to reflect the Share Consolidation.

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Notes to Condensed Interim Consolidated Financial Statements Three Months Ended March 31, 2020 (Expressed in Canadian Dollars) (Unaudited)

Austin Resources Ltd.

2. Significant accounting policies

Statement of compliance

The Company applies International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board (“IASB”) and interpretations issued by the International Financial Reporting Interpretations Committee (“IFRIC”). These unaudited condensed interim consolidated financial statements have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting. Accordingly, they do not include all of the information required for full annual financial statements required by IFRS as issued by IASB and interpretations issued by IFRIC.

The policies applied in these unaudited condensed interim consolidated financial statements are based on IFRS issued and outstanding as of May 22, 2020, the date the Board of Directors approved the statements. The same accounting policies and methods of computation are followed in these unaudited condensed interim consolidated financial statements as compared with the most recent annual financial statements as at and for the year ended December 31, 2019. Any subsequent changes to IFRS that are given effect in the Company’s annual financial statements for the year ending December 31, 2020 could result in restatement of these unaudited condensed interim consolidated financial statements.

3. Exploration and evaluation properties and expenditures

On February 27, 2020, the Company received approval of its shareholders and the TSX Venture Exchange for the transfer of all of its interest in the mineral exploration properties in Chile held by Minera Azul.

4. Discontinued operation

Subsequent to transfer of all of its interest in the mineral exploration properties in Chile held by Minera Azul, the Company intends to wind up operations in Chile and dispose of its interest in Minera Azul.

Pursuant to IFRS 5, Non-Current Assets Held for Sale and Discontinued Operations, the unaudited condensed interim consolidated financial statements of the Company have been reclassified to reflect discontinued operation of Minera Azul. Accordingly, assets, liabilities, net loss and cash flows of discontinued operation have been segregated in the unaudited condensed interim consolidated statements of financial positions, the unaudited condensed interim consolidated statements of loss and comprehensive loss and the unaudited condensed interim consolidated statements of cash flows.

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Austin Resources Ltd.

Notes to Condensed Interim Consolidated Financial Statements Three Months Ended March 31, 2020 (Expressed in Canadian Dollars) (Unaudited)

4. Discontinued operation (continued)

The following tables present summarized financial information related to discontinued operations in Minera Azul:

Statements of financial position of discontinued operation as at March 31, 2020:

		March 31,
		2020
ASSETS
Current assets
Cash and cash equivalents	$	11,035
Amounts receivable		468
Prepaid expenses		1,507
		13,010
Equipment		49
Total assets held for sale	$	13,059
Liabilities related to assets held for sale
Amounts payable and accrued liabilities	$	10,505

Unaudited condensed interim consolidated statements of loss and comprehensive loss for the periods of discontinued operation ended March 31, 2020 and 2019:

Three Months Ended March 31,		2020		2019
Exploration and evaluation expenditures (recovery)	$	(21,381)	$	12,145
Professional fees		16,572		5,982
Office expenses		40		96
Bank charges		300		332
Depreciation		22		31
Loss before other items		(4,447)		18,586
Foreign exchange loss (gain)		27,033		(202)
Net loss and comprehensive loss	$	22,586	$	18,384

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Notes to Condensed Interim Consolidated Financial Statements Three Months Ended March 31, 2020 (Expressed in Canadian Dollars) (Unaudited)

Austin Resources Ltd.

4. Discontinued operation (continued)

Statements of cash flows of the discontinued operation for the periods ended March 31,2020 and 2019:

Three Months Ended March 31,		2020		2019
Cash used in operating activities for discontinued operation		(16,427)		(18,458)
Cash provided by financing activities for discontinued operation		20,077		13,885
Net change in cash and cash equivalents
for discontinued operation		3,650		(4,573)
Cash and cash equivalents, beginning of the period
for discontinued operation		7,385		6,176
Cash and cash equivalents, end of the period
for discontinued operation	$	11,035	$	1,603

5. Equipment

			**Accumulated **	**Accumulated **		Net book
		Cost	depreciation			value
Balance, December 31, 2019	$	8,768	$	(8,697)	$	71
Depreciation		-		(22)		(22)
Transferred to assets held for sale		(8,768)		8,719		(49)
Balance, March 31, 2020	$	-	$	-	$	-

The Company’s equipment is located in Chile.

6. Related party loan

On May 26, 2016, the Company entered into a loan agreement with Guilin International Company Limited ("Guilin"), a major shareholder of the Company, in the amount of $500,000 at an interest rate of 10% per annum. During the year ended December 31, 2019, the Company repaid the related party loan in full in the amount of $663,424 including accrued interest of $163,424. As at March 31, 2020, the Company owes $nil (December 31, 2019 - $102,411) including accrued interest.

During the year ended December 31, 2019, the Company entered a loan agreement with a shareholder of the Company in the amount of $100,000 at an interest rate of 10% per annum. During the three months ended March 31, 2020, the Company accrued interest expense of $2,493. As at March 31, 2020, the Company owes $104,904 (December 31, 2019 - $102,411) including accrued interest.

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Notes to Condensed Interim Consolidated Financial Statements Three Months Ended March 31, 2020 (Expressed in Canadian Dollars) (Unaudited)

Austin Resources Ltd.

7. Share capital

a) Authorized share capital

The authorized share capital consisted of an unlimited number of common shares without par value.

b) Common shares issued

	Number of
	common
	shares	Amount
Balance, December 31, 2018, March 31, 2019,	8,846,618 $	5,448,187
Proceeds fromprivateplacement offering,net	12,500,000	695,888
Balance,December 31,2019 and March 31,2020	21,346,618 $	6,144,075

On August 7, 2019, the Company completed a private placement offering ("Private Placement") of $750,000 in gross proceeds based on the issuance of 12,500,000 common shares at a price of $0.06 per common share. The common shares issued in connection with the Private Placement were subject to a resale restriction for a period of four months plus one day from August 7, 2019. The Company incurred a total issuance cost of $54,112.

8. Warrants

The Company had no warrants outstanding as at March 31, 2020.

9. Stock options

The Company has adopted a stock option plan (the “Plan"), to be administered by the Directors of the Company. Under the Plan, the Company may grant options to directors, officers, employees and consultants to purchase shares of the Company. The Plan provides for the issuance of stock options to acquire up to 10% of the Company's issued and outstanding capital. The plan is a rolling plan as the number of shares reserved for issuance pursuant to the grant of stock options will increase as the Company’s issued and outstanding share capital increases. Options granted under the Plan will be for a term not to exceed five years. The plan provides that it is solely within the discretion of the Board to determine who should receive stock options, in what amounts, and determine vesting terms. The exercise price for any stock option shall not be lower than the market price of the underlying common shares at the time of grant.

Each stock option converts into one common share of the Company on exercise. No amounts are paid or payable by the recipient on receipt of the option. The options carry neither rights to dividends nor voting rights. Options may be exercised at any time from the date of vesting to the date of their expiry. The Company settles stock options exercised through the issuance of common shares from treasury.

The Company had no stock options outstanding as at March 31, 2020.

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Notes to Condensed Interim Consolidated Financial Statements Three Months Ended March 31, 2020 (Expressed in Canadian Dollars) (Unaudited)

Austin Resources Ltd.

10. Related party transactions

(a) Compensation of key management personnel of the Company

Key management personnel include those persons having authority and responsibility for planning, directing and controlling the activities of the Company as a whole. The Company has determined that key management personnel consists of the Board of Directors, corporate officers, including the Chief Executive Officer and the Chief Financial Officer, as well the Country Manager.

	Three months	Three months	Three months
		ended	ended
		March 31,	March 31,
		2020	2019
Salaries and benefits	$	6,085	$ 5,953

(b) Transactions with related parties

The Chief Financial Officer is an employee of Marrelli Support Services Inc. ("MSSI"), a firm providing accounting services. During the three months ended March 31, 2020, the Company incurred $12,552 (three months ended March 31, 2019 - $6,682) for accounting services (included in professional fees) rendered by MSSI. As at March 31, 2020, MSSI was owed $7,789 (December 31, 2019 - $1,792) and this amount was included in accounts payable and accrued liabilities. The amount is unsecured, non-interest bearing and due on demand.

Refer to note 6.

11. Loss per share

For the three months ended March 31, 2020, basic and diluted loss per share has been calculated based on the loss attributable to common shareholders of $56,667 (three months ended March 31, 2019 - $53,031) and the weighted average number of common shares outstanding of 21,346,618, respectively (three months ended March 31, 2019 - 8,846,618).

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Austin Resources Ltd.

Notes to Condensed Interim Consolidated Financial Statements Three Months Ended March 31, 2020 (Expressed in Canadian Dollars) (Unaudited)

12. Segmented Information

The Company conducts its business as a single operating segment, being mineral exploration and evaluation in Chile and Canada. The following table summarizes the total assets and liabilities by geographic segment as at:

March 31, 2020		Chile		Canada		Total
Cash and cash equivalents	$	11,035	$	35,011	$	46,046
Other current assets		1,975		3,708		5,683
Equipment		49		-		49
Total assets	$	13,059	$	38,719	$	51,778
Accounts payable and accrued liabilities	$	10,505	$	36,604	$	47,109
Relatedpartyloan		-		104,904		104,904
Total liabilities	$	10,505	$	141,508	$	152,013
December 31, 2019		Chile		Canada		Total
Cash and cash equivalents	$	7,385	$	75,229	$	82,614
Other current assets		2,044		1,586		3,630
Equipment		71		-		71
Total assets	$	9,500	$	76,815	$	86,315
Accounts payable and accrued liabilities	$	4,435	$	23,037	$	27,472
Relatedpartyloan		-		102,411		102,411
Total liabilities	$	4,435	$	125,448	$	129,883

The following table summarizes the loss by geographic segment:

Three months ended March 31, 2020		Chile		Canada		Total
Exploration and evaluation expenditures (recovery)	$	(21,381)	$	-	$	(21,381)
General and administrative expense		16,934		33,747		50,681
Foreign exchange loss		27,033		334		27,367
	$	22,586	$	34,081	$	56,667
Three months ended March 31, 2019		Chile		Canada		Total
Exploration and evaluation expenditures	$	12,145	$	-	$	12,145
General and administrative expense		6,410		34,509		40,919
Foreign exchange (gain) loss		(202)		138		(64)
Depreciation expense		31		-		31
	$	18,384	$	34,647	$	53,031

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Austin Resources Ltd.

Notes to Condensed Interim Consolidated Financial Statements Three Months Ended March 31, 2020 (Expressed in Canadian Dollars) (Unaudited)

13. Commitments and contingencies

The Company’s activities were subject to various laws and regulations. These laws and regulations are continually changing and generally becoming more restrictive. The Company believes its operations are materially in compliance with all applicable laws and regulations. The Company has made, and expects to make in the future, expenditures to comply with such laws and regulations.

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