Hemlo Mining Corp. — Interim / Quarterly Report 2025

May 27, 2025

CARCETTI CAPITAL CORP.

Condensed Interim Financial Statements

For the three months ended March 31, 2025 and 2024

(Expressed in Canadian Dollars - Unaudited)

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Notice to Readers

Under National Instrument 51-102, Part 4, subsection 4.3(3)(a), if an auditor has not performed a review of the condensed 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 condensed interim financial statements have been prepared by and are the responsibility of the 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 of Canada for a review of condensed interim financial statements by an entity’s auditor.

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Carcetti Capital Corp.

Condensed Interim Statements of Financial Position

(Expressed in Canadian dollars- Unaudited)

	Note	As at
		March 31, 2025	December 31, 2024
Assets
Current assets
Cash		275,343	311,350
Receivables		1,645	448
Prepaid expenses		7,515	7,516
		284,503	319,314
Non-current assets
Prepaids		20,667	22,545
Total assets		305,170	341,859
Liabilities
Current liabilities
Accounts payable and accrued liabilities		14,282	31,985
Total liabilities		14,282	31,985
Shareholders' equity
Share capital	4	48,576,044	48,576,044
Reserves	4	6,522,902	6,522,902
Deficit		(54,808,058)	(54,789,072)
Total shareholders' equity		290,888	309,874
Total shareholders' equity and liabilities		305,170	341,859

Nature of operations and going concern (Note 1)
Subsequent event (Note 8)

These condensed interim financial statements were approved by the Board of Directors of the Company on May 16th, 2025.

Approved by the Board
“Glenn Kumoi”
Director (Signed)
“Richard Silas”
Director (Signed)

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

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Carcetti Capital Corp.

Condensed Interim Statements of Loss and Comprehensive Loss

(Expressed in Canadian dollars - Unaudited)

	Note	Three months ended March 31,
		2025	2024
		$	$
Operating expenses
Management fees	5	3,126	3,126
Office and general		5,093	5,558
Professional fees		10,767	7,243
Stock-based compensation	4, 5	-	2,210
Net and Comprehensive loss		(18,986)	(18,137)
Basic and Diluted loss per share		(0.00)	(0.00)
Weighted average number of common shares - basic and diluted		5,669,050	5,214,050

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

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Carcetti Capital Corp.

Condensed Interim Statements of Changes in Shareholders' Equity

(Expressed in Canadian dollars - Unaudited)

	Number of shares	Share capital $	Contributed surplus $	Deficit $	Total $
Balances as at December 31, 2023 (restated Note 2)	5,214,050	48,494,144	6,515,302	(54,670,540)	338,906
Stock-based compensation	-	-	2,210	-	2,210
Net and comprehensive loss	-	-	-	(18,137)	(18,137)
Balances as at March 31, 2024	5,214,050	48,494,144	6,517,512	(54,688,677)	322,979
Stock-based compensation	-	-	5,390	-	5,390
Warrants exercised	455,000	81,900	-	-	81,900
Net and comprehensive loss	-	-	-	(100,395)	(100,395)
Balances as at December 31, 2024	5,669,050	48,576,044	6,522,902	(54,789,072)	309,874
Warrants exercised	-	-	-	-	-
Net and comprehensive loss	-	-	-	(18,986)	(18,986)
Balances as at March 31, 2025	5,669,050	48,576,044	6,522,902	(54,808,058)	290,888

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

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Carcetti Capital Corp.

Condensed Interim Statements of Cash Flow

(Expressed in Canadian dollars - Unaudited)

	For the three months ended March 31,
	2025	2024
	$	$
Operating activities
Loss for the period	(18,986)	(18,137)
Adjustment for non-cash items:
Stock-based compensation	-	2,210
Changes in working capital:
Trade and other receivables	(1,197)	(262)
Prepaid expenses	1,879	2,003
Trade and other payables	(17,703)	(23,741)
Cash used in operating activities	(36,007)	(37,927)
Net change in cash	(36,007)	(37,927)
Cash at beginning of period	311,350	337,067
Cash at end of period	275,343	299,140

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

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Carcetti Capital Corp. For the periods ended March 31, 2025 and 2024 Notes to the condensed interim financial statements (Expressed in Canadian dollars - Unaudited)

1 Nature of operations and going concern

Carcetti Capital Corp. (the “Company”) was engaged in the exploration and development of energy. The Company was incorporated pursuant to the provisions of the Business Corporations Act (Ontario) and continued under the Canadian Business Corporations Act in February 2012. The address of the Company’s registered and records office is 1200 Waterfront Centre, 200 Burrard street, Vancouver, BC, V7X 2T2. The Company is listed on the NEX board of the TSX Venture Exchange (“TSXV”) under the trading symbol “CART.H”.

The Company is currently assessing the business opportunities available in the market, and plan to pursue something once the management is able to find an opportunity that fits Company’s objectives.

Going concern

These condensed interim financial statements for the period ended March 31, 2025 and December 31, 2024 (the “Financial statements”) have been prepared on the assumption that the Company 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. Different bases of measurement may be appropriate if the Company is not expected to continue operations for the foreseeable future. As of March 31, 2025 the Company had accumulated deficit of $54,808,058 (December 31, 2024 – $54,789,072) and had working capital of $270,221 (December 31, 2024 – $287,329) is to finance day to day operations. The Company’s continuation as a going concern is dependent upon 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 events and conditions indicate that a material uncertainty exists that may cast significant doubt on the Company’s ability to continue as a going concern. Management intends to finance operating costs over the next twelve months with current cash on hand, and further private placements.

These Financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue in existence.

2 Basis of presentation

Statement of compliance

These condensed interim financial statements, including comparatives, have been prepared in accordance with IFRS Accounting Standards (“IAS”) 34 “Interim Financial Reporting” as issued by the International Accounting Standards Board (“IASB”).

These condensed interim financial statements do not include all of the information required of annual financial statements and is intended to provide users with an update in relation to events and transactions that are significant to an understanding of the changes in financial position and performance of the Company since the end of the last annual reporting period. It is therefore recommended that these condensed interim financial statements be read in conjunction with the annual financial statements of the Company for the years ended December 31, 2024 and 2023.

Basis of preparation

These Financial statements of the Company have been prepared on an accrual basis and are based on historical costs, modified where applicable. These Financial statements are presented in Canadian dollars unless otherwise noted.

As at December 31, 2024, the Company changed its accounting policy to present its results in Canadian dollars instead of United States dollars as done previously. The change in presentation currency is to better reflect the Company’s business activities. This accounting change has been applied retrospectively in preparing these Financial statements; as such, all comparative figures have been restated to reflect this change.

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Carcetti Capital Corp.
For the periods ended March 31, 2025 and 2024
Notes to the condensed interim financial statements
(Expressed in Canadian dollars - Unaudited)

2 Basis of presentation (continued)

Use of estimates and judgments

Management makes a number of estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities to prepare these Financial statements in conformity with IFRS Accounting Standards. Actual results could differ from those estimates. For the three months ended March 31, 2025 and 2024 there were no significant estimates and judgements.

3 Material accounting policies

The accounting policy information set out below have been applied consistently to all periods presented in these Financial statements.

Foreign currency

Foreign currency transactions

Transactions in foreign currencies are translated to the respective functional currencies of the Company's entities at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated to the functional currency at the exchange rate at that date. The foreign currency gain or loss resulting from the settlement of such transactions and from the translation at the reporting date of monetary assets and liabilities denominated in foreign currencies is recognized in profit or loss. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are translated to the functional currency at the exchange rate at the date that the fair value was determined.

Financial instruments

Classification

Financial assets are classified at initial recognition as either: measured at amortized cost, fair value through profit or loss ("FVTPL"), or fair value through other comprehensive loss ("FVTOCI"). The classification depends on the Company's business model for managing the financial assets and the contractual cash flow characteristics. For assets measured at fair value, gains and losses will either be recorded in profit or loss or other comprehensive income. Fair value through profit or loss ("FVTPL") – Financial assets carried at FVTPL are initially recorded at fair value and transaction costs are expensed in the statement of operations. Realized and unrealized gains and losses arising from changes in the fair value of the financial asset held at FVTPL are included in the statement of operations in the period in which they arise. Derivatives are also categorized as FVTPL unless they are designated as hedges.

Under IFRS 9, the Company classifies its financial instruments as follows:

Cash	Amortized cost
Receivables	Amortized cost
Accounts payable and accrued liabilities	Amortized cost

Measurement

FVTOCI - Investments in equity instruments at FVTOCI are initially recognized at fair value plus transaction costs. Subsequently, they are measured at fair value, with gains and losses arising from changes in fair value recognized in other comprehensive income. There is no subsequent reclassification of fair value gains and losses to profit or loss following the derecognition of the investment.

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Carcetti Capital Corp.
For the periods ended March 31, 2025 and 2024
Notes to the condensed interim financial statements
(Expressed in Canadian dollars - Unaudited)

3 Material accounting policies (continued)

Financial instruments (continued)

Measurement (continued)

Financial assets and liabilities at amortized cost - Financial assets and liabilities at amortized cost are initially recognized at fair value plus or minus transaction costs, respectively, and subsequently carried at amortized cost less any impairment. Derivatives embedded in contracts where the host is a financial asset in the scope of the standard are never separated. Instead, the hybrid financial instrument as a whole is assessed for classification.

Financial assets and liabilities at FVTPL - Financial assets and liabilities carried at FVTPL are initially recorded at fair value and transaction costs are expensed in profit or loss. Realized and unrealized gains and losses arising from changes in the fair value of the financial assets and liabilities held at FVTPL are included in profit or loss in the period in which they arise. Where management has opted to recognize a financial liability at FVTPL, any changes associated with the Company's own credit risk will be recognized in other comprehensive income (loss).

Impairment

An 'expected credit loss' impairment model applies which requires a loss allowance to be recognized based on expected credit losses. The estimated present value of future cash flows associated with the asset is determined and an impairment loss is recognized for the difference between this amount and the carrying amount as follows: the carrying amount of the asset is reduced to estimated present value of the future cash flows associated with the asset, discounted at the financial asset's original effective interest rate, either directly or through the use of an allowance account and the resulting loss is recognized in profit or loss for the period.

In a subsequent period, if the amount of the impairment loss related to financial assets measured at amortized cost decreases, the previously recognized impairment loss is reversed through profit or loss to the extent that the carrying amount of the investment at the date the impairment is reversed does not exceed what the amortized cost would have been had the impairment not been recognized.

Derecognition

The Company derecognizes financial assets only when the contractual rights to cash flows from the financial assets expire, or when it transfers the financial assets and substantially all of the associated risks and rewards of ownership to another entity. Gains and losses on derecognition are generally recognized in the statements of loss and comprehensive loss. However, gains and losses on derecognition of financial assets classified as FVTOCI remain within accumulated other comprehensive income (loss). The Company derecognizes financial liabilities only when its obligations under the financial liabilities are discharged, cancelled or expired. Generally, the difference between the carrying amount of the financial liability derecognized and the consideration paid and payable, including any non-cash assets transferred or liabilities assumed, is recognized in the statements of loss and comprehensive loss.

Impairment of assets

Non-financial assets

The carrying amounts of the Company's non-financial assets, other than deferred tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, the asset's recoverable amount is estimated.

Assets that cannot be tested individually are grouped together into Cash Generating Units ("CGUs"). The impairment test consists of comparing the carrying amount of the asset or the CGU to its recoverable amount, which is the greater of its fair value less costs of disposal ("FVLCD") and value in use ("VIU").

In determining FVLCD, discounted cash flows, future developments, and recent market transactions are taken into account, if available. These calculations are corroborated by valuation multiples or other available fair value indicators. Inputs are those that an independent market participant would consider appropriate.

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Carcetti Capital Corp.
For the periods ended March 31, 2025 and 2024
Notes to the condensed interim financial statements
(Expressed in Canadian dollars - Unaudited)

3 Material accounting policies (continued)

Impairment of assets (continued)

Non-financial assets (continued)

In determining VIU, the Company estimates the present value of the future net cash flows expected to be derived from the continued use of the asset or CGU without consideration for potential enhancement or improvement of the underlying asset’s performance. Discount rates that reflect the market assessments of the time value of money and the risks specific to the asset or CGU are used.

Determining the recoverable amount of the CGU requires estimating various items such as future commodity prices, production and reserves, an appropriate pre-tax discount rate that takes into account the implicit risk in the sectors where the Company operates, operating costs, future development costs, royalties and production taxes.

If the recoverable amount is less than the carrying amount of the asset or the CGU, an impairment loss is recognized for the difference. Impairment losses recognized in respect of CGUs are allocated first to reduce any applicable goodwill related to the CGU and then to all other assets in the CGU on a pro rata basis. However, assets are not written down below the lower of nil and the recoverable amount of the assets.

When it is determined that the recoverable amount is greater than the carrying amount, previously recognized impairment losses are reversed. Previous impairment losses cannot be reversed above the lower of the recoverable amount or the carrying amount that would have been determined, net of depreciation, at the time of the reversal had the previous impairment never been recorded. An impairment loss in respect of goodwill cannot be reversed.

Share capital

Financial instruments issued by the Company are classified as equity only to the extent that they do not meet the definition of a financial liability or financial asset. The Company’s common shares, share warrants and options are classified as equity instruments.

Incremental costs directly attributable to the issue of new shares or options are recognized as a deduction from equity, net of tax.

Valuation of equity units issued in private placements

The Company has adopted a residual value method with respect to the measurement of shares and warrants issued as private placement units. The residual value method first allocates value to the more easily measurable component based on fair value and then the residual value, if any, to the less easily measurable component.

The fair value of the common shares issued in private placements was determined to be the more easily measurable component and were valued at their fair value, as determined by the closing price on the issuance date, the balance, if any, was allocated to the attached warrants. Any fair value attributed to the warrants is recorded to reserves. If the warrants expire unexercised, the value attributed to the warrants is transferred from reserves to share capital.

Loss per share

Basic loss per share is computed by dividing loss available to common shareholders by the weighted average number of shares outstanding during the reporting period. Diluted loss per share is computed similar to basic loss per share except that the weighted average shares outstanding are increased to include additional shares for the assumed exercise of stock options and warrants, if dilutive. The number of additional shares is calculated by assuming that outstanding stock options and warrants were exercised and that the proceeds from such exercises were used to acquire common stock at the average market price during the reporting periods. To the extent that the Company incurs losses, all potential shares are considered to be anti-dilutive and no adjustment is made.

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Carcetti Capital Corp.
For the periods ended March 31, 2025 and 2024
Notes to the condensed interim financial statements
(Expressed in Canadian dollars - Unaudited)

3 Material accounting policies (continued)

Share-based payments

The Company operates an employee stock option plan. Share-based payments to employees are measured at the fair value of the instruments issued and amortized over the vesting periods. Share-based payments to non-employees are measured at the fair value of goods or services received or the fair value of the equity instruments issued, if it is determined the fair value of the goods or services cannot be reliably measured, and are recorded at the date the goods or services are received. The corresponding amount is recorded to reserves. Share-based payments to non-employees are measured on the date and at the fair value of goods or services received, or fair value of the equity instruments issued, whichever can be more reliably measured. The number of shares and options expected to vest is reviewed and adjusted at the end of each reporting period such that the amount recognized for services received as consideration for the equity instruments granted shall be based on the number of equity instruments that eventually vest.

For both employees and non-employees, the fair value of share-based payments is recognized as an expense with a corresponding increase in reserves. The amount recognized as expense is adjusted to reflect the number of share options expected to vest. Consideration received on the exercise of stock options is recorded in share capital and the related share-based payment in reserves is transferred to share capital. The Company transfers the value of cancelled and expired unexercised vested stock options to deficit from reserves on the date of expiration.

Operating segments

An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Company's other components. All operating segments' operating results are reviewed regularly by the Company's CEO to make decisions about resources to be allocated to the segment and assess its performance and for which discrete financial information is available. Segment results that are reported to the CEO include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.

The Company is not operating in any reportable segments as it continues to explore new business opportunities.

New accounting standards adopted

In October 2023, the IASB issued amendments to IAS 1, Presentation of Financial Statements – Classification of Liabilities as Current or Non-Current and Noncurrent Liabilities with Covenants. These amendments increase the disclosure required to enable users of financial statements to understand the risk that non-current liabilities with covenants could become repayable within 12 months. The amendments are effective January 1, 2024, with early adoption permitted. Retrospective application is required on adoption. The Company determined that these amendments didn't have a material effect on its financial statements.

New standards issued and not yet effective

The following new standards, amendments to standards and interpretations have been issued but are not effective during the three months ended March 31, 2025.

On April 9, 2024, the IASB issued a new standard – IFRS 18, “Presentation and Disclosure in Financial Statements” with a focus on updates to the statement of profit or loss. The key new concepts introduced in IFRS 18 relate to:

• the structure of the statement of profit or loss;
• required disclosures in the financial statements for certain profit or loss performance measures that are reported outside an entity's financial statements (that is, management-defined performance measures); and
• enhanced principles on aggregation and disaggregation which apply to the primary financial statements and notes in general.

IFRS 18 will replace IAS 1; many of the other existing principles in IAS 1 are retained, with limited changes. IFRS 18 will apply for reporting periods beginning on or after January 1, 2027, with early adoption permitted and also applies to comparative information. Adoption of IFRS 18 will not impact the recognition or measurement of items in the financial statements, but it might change what an entity reports as its 'operating profit or loss'. The Company is currently assessing the impact the new standard will have on its financial statements.

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Carcetti Capital Corp.

For the periods ended March 31, 2025 and 2024

Notes to the condensed interim financial statements

(Expressed in Canadian dollars - Unaudited)

4 Share capital and reserves

Authorized shares

The Company is authorized to issue an unlimited number of Class A common shares, an unlimited number of Class B common shares, and an unlimited number of Preferred shares.

Issued shares

During the three months ended March 31, 2025:

There were no transactions during the three months period ended March 31, 2025.

During the year ended December 31, 2024:

In May 2024, the Company issued 455,000 common shares of the Company in connection with the exercise of 455,000 warrants at an exercise price of $0.18 per share for gross proceeds of $81,900.

Stock options

The Company has a stock option plan under which it is authorized to grant options to its directors, officers, employees and consultants for the purchase of up to 10% of the issued and outstanding common shares. The term of options under the plan shall not exceed 10 years, have an exercise price not less than the current market price and may be subject to vesting terms as determined by the board of directors.

There were no stock option transactions during the period ended March 31, 2025 and year ended December 31, 2024.

Number of Options Outstanding	Number of Options Exercisable	Exercise Price	Expiry Date
		$
12,333	12,333	24.00	December 7, 2026
90,000	90,000	0.26	November 8, 2028
102,333	102,333

The weighted average life of options outstanding as at March 31, 2025 was 3.38 (December 31, 2024 - 3.63) years.

Warrants

	Number of warrants	Exercise Price
		$
Balance, December 31, 2023	2,083,333	0.18
Exercised	(455,000)	0.18
Expired	(1,628,333)	0.18
Balance, December 31, 2024 and March 31, 2025	-	-

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Carcetti Capital Corp.

For the periods ended March 31, 2025 and 2024

Notes to the condensed interim financial statements

(Expressed in Canadian dollars - Unaudited)

5 Related party transactions

Transactions with related parties are incurred in the normal course of business. Key management personnel include executive officers and non-executive directors. Executive officers are compensated and may participate in the Company's stock option plan. Non-executive directors also may participate in the Company's stock option plan. The Company entered into the following transactions with key management personnel:

	Three months ended March 31,
	2025	2024
	$	$
Management fees	3,000	3,000
Stock-based compensation	-	2,210
	3,000	5,210

6 Financial instruments

The Company's financial instruments consist of cash, receivables (excluding sales tax), and accounts payable and accrued liabilities. The Company's financial assets and liabilities are classified at amortized cost. The fair values of the Company's financial instruments approximate their carrying values due to the short-term nature of the accounts.

The Company classifies its fair value measurements in accordance with the three levels fair value hierarchy as follows:

• Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities
• Level 2 – Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly, and
• Level 3 – Inputs that are not based on observable market data.

The Company is exposed in varying degrees to a variety of financial instrument related risks. The Board of Directors approves and monitors the risk management processes, inclusive of documented investment policies, counterparty limits, and controlling and reporting structures. The type of risk exposure and the way in which such exposure is managed is provided as follows:

Credit risk

Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. The Company's primary exposure to credit risk is on its cash held in bank accounts. The Company has deposited its cash with a large Canadian financial institution. Management believes the risk of loss is low.

Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company's approach to managing liquidity is to ensure that it will have sufficient working capital to meet liabilities when due. As at March 31, 2025, the Company had a cash balance of $275,343 to settle accounts payable and accrued liabilities of $14,282.

Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates and interest rates will affect the Company's income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposure within acceptable parameters, while optimizing the return.

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Carcetti Capital Corp.
For the periods ended March 31, 2025 and 2024
Notes to the condensed interim financial statements
(Expressed in Canadian dollars - Unaudited)

7 Capital management

The Company’s objectives when managing capital are to safeguard the Company’s ability to continue as a going concern and to maintain a flexible capital structure which will allow it to meet its exploration commitments. Therefore, the Company monitors the level of risk incurred in its expenditures relative to its capital structure. The Company considers its capital structure to include shareholders’ equity. The Company monitors its capital structure and makes adjustments in light of changes in economic conditions and the risk characteristics of the potential underlying assets. To maintain or adjust the capital structure, the Company may issue new equity if available on favorable terms and approved by the TSXV. Management reviews its capital management approach on an ongoing basis and believes that this approach, given the relative size of the Company, is reasonable. There were no changes to the Company’s approach to capital management during the three months ended March 31, 2025. The Company is not subject to any externally imposed capital requirements.

8. Subsequent event

On April 25, 2025, the Company announced a non-brokered private placement of up to 14,000,000 common shares of the Company at a price of $0.125 per common share for aggregate proceeds of $1,750,000.

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