New Target Mining Corp. — Interim / Quarterly Report 2021

Jul 1, 2021

NEW TARGET MINING CORP.

Management Discussion and Analysis

FOR THE SIX MONTHS ENDED APRIL 30, 2021

June 30, 2021

The following discussion and analysis should be read in conjunction with the condensed interim financial statements for the six months ended April 30, 2021, and related notes included therein, prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and in accordance with International Accounting Standards (“IAS”) 34, Interim Financial Reporting. All monetary amounts, unless otherwise indicated, are expressed in Canadian dollars. Additional regulatory filings for the Company can be found on the SEDAR website at www.sedar.com.

New Target Mining Corp. (the “Company”) was incorporated under the Business Corporations Act (British Columbia) on July 28, 2020. On March 2, 2021 the Company became a reporting issuer. On April 15, 2021, the Company completed its initial public offering and was listed on the TSX Venture Exchange under the symbol NEW. The Company is an exploration stage junior mining company currently engaged in the identification, acquisition and exploration of mineral properties in Canada.

Forward-Looking Statements

Certain statements contained in this document constitute “forward-looking statements”. When used in this document, the words “may”, “would”, “could”, “will”, “intend”, “plan”, “propose”, “anticipate”, “believe”, “forecast”, “estimate”, “expect” and similar expressions, as they relate to the Company or its management, are intended to identify forward-looking statements. Such statements reflect the Company’s current views with respect to future events and are subject to certain risks, uncertainties and assumptions. Many factors could cause the Company’s actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Forward-looking statements herein include, but is not limited to, statements relating to the timing, availability and amount of financings; expected use of proceeds; business objectives; the costs and timing relating to the potential acquisition of interests in mineral properties; the timing and costs of future exploration activities on the Company's future properties; success of exploration activities; permitting time lines and requirements for additional capital; the impact of COVID-19 or other viruses and diseases on the Company's ability to operate; and failure to maintain community acceptance (including First Nations). In making forward-looking statements herein, the Company has applied several material assumptions, including, but not limited to, any additional financing needed will be available on reasonable terms, that general business and economic conditions will not change in a materially adverse manner, and that all necessary governmental approvals for the future exploration will be obtained in a timely manner and on acceptable terms. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward looking statements. Such risks and other factors include, among others, risks related to the completion of financings and the use of proceeds; operations and contractual obligations; changes in exploration programs based upon results of exploration; future prices of metals; availability of third party contractors; availability of equipment; failure of equipment to operate as anticipated; accidents, effects of weather and other natural phenomena and other risks of the mineral exploration industry; environmental risks; community relations; and delays in obtaining governmental approvals or financing.

We undertake no duty to update any of the forward-looking information to conform such information to actual results or to changes in our expectations except as otherwise required by applicable securities legislation. Readers are cautioned not to place undue reliance on forward-looking information.

Overview and Going Concern

The Company is in the business of acquiring exploration and evaluation assets. The Company currently has a property option agreement on the Scarlett Property in British Columbia, Canada. The Company expects its current capital resources will not be sufficient to complete its exploration plans and operations through its current operating year and will be required to raise additional funds through future equity issuances. The Company’s ability to continue as a going concern is therefore dependent on its ability to raise additional funds through equity issuances. These material uncertainties may cast significant doubt on the entity’s ability to continue as a going concern.

The condensed interim financial statements for the six months ended April 30, 2021 were prepared on a going concern basis 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 continuing operations of the Company are dependent upon its ability to continue to raise adequate financing and to commence profitable operations in the future. The condensed interim financial statements do not include any adjustments relating to the recoverability and classification of recorded assets and liabilities that might be necessary should the Company be unable to continue as a going concern.

In March 2020, the World Health Organization declared coronavirus COVID-19 a global pandemic. This contagious disease outbreak, which has continued to spread, and any related adverse public health developments, has adversely affected workforces, economies, and financial markets globally, potentially leading to an economic downturn. It is not possible for the Company to predict the duration or magnitude of the adverse results of the outbreak and its effects on the Company’s business or ability to raise funds. There has been no material disruption to the Company’s current operations to date. The Company's current focus is on its project located in British Columbia, Canada and as a result, access to the property is not currently prohibited. The Company may consider acquisitions of other properties in foreign or domestic jurisdictions in the future.

Results of Operations

The results of operations reflect the overhead costs incurred by the Company to maintain an administrative infrastructure to manage the acquisition, and financing activities of the Company. General and administrative costs can be expected to increase or decrease in relation to the changes in activity required as property acquisitions continues. The Company has not recorded, since the date of its incorporation, any revenues from its mineral exploration and development activities, nor does it expect to record any revenue over the course of the next 12 months.

Mineral Properties

Scarlett Property, British Columbia

The Scarlett Gold Property consists of ten mining claims, covering approximately 1,473.23 hectares land located in the New Westminster Mining Division, Mission, British Columbia. The Scarlett Gold Property claims are located approximately 65 kilometres from Vancouver, BC.

On August 5, 2020, the Company entered into an option agreement, subsequently amended, (“Option Agreement”) with Infiniti Drilling Corporation (“Infiniti”), whereby the Company was granted an irrevocable and exclusive option to acquire a 100% interest in and to Infiniti’s nine (9) mineral claims located in New Westminster Mining Division, Mission, British Columbia (“Scarlett Property”). Subsequently one (1) additional claim was added to the option agreement pursuant to the area of interest provision. In order to earn the interest, the Company must make the following cash payments, common share issuances and exploration expenditures:

• i) pay $12,000 (paid) within 10 days of execution of the Option Agreement; ii) issue 150,000 common shares of the Company (issued); iii) pay $20,000, issue 200,000 common shares of the Company and incur $200,000 in exploration expenditures on the Scarlett Property by the 12-month anniversary of the Listing Date;

• iv) pay $20,000, issue 200,000 common shares of the Company and incur an additional $200,000 in exploration expenditures on the Scarlett Property by the 24-month anniversary of the Listing Date;

• v) pay $25,000, issue 300,000 common shares of the Company and incur an additional $200,000 in exploration expenditures on the Scarlett Property by the 36-month anniversary of the Listing Date; and

• vi) pay $50,000, issue 500,000 common shares of the Company and incur an additional $200,000 in exploration expenditures on the Scarlett Property by the 48-month anniversary of the Listing Date.

If the Scarlett Property is acquired by the Company, then it will be required to pay a 1.0% net smelter returns royalty payable to Infiniti upon the commencement of commercial production.

During the six month period ended April 30, 2021, the following exploration expenses were incurred on the exploration and evaluation assets:

ion and evaluation assets:
Scarlett Property, British Columbia	Total
Acquisition costs Balance, April 30, 2021 Exploration costs Balance, October 31, 2020 Assays and GIS Balance, April 30, 2021 Total balance,April 30,2021	$ 12,979
	100,308 8,769
	109,077
	$ 122,056

On April 27, 2021, the Company announced that it has engaged Infiniti Drilling Corp. to conduct exploration and prospecting on the Company’s Scarlett Property. Mr. Kristian Whitehead, B.Sc., P.Geo. will be the managing professional geologist overseeing the exploration activities for the Scarlett Property.

Revenues

Due to the Company’s status as an exploration and development stage mineral resource company, the Company currently does not have any revenues from its operations, nor does it expect to record any revenue over the course of the next 12 months.

General and Administrative Expenses

The Company incurred a loss and comprehensive loss for the six months ended April 30, 2021 of $118,832 which consists of:

• i) Filing and regulatory fee of $37,510 which consists of fees paid the TSX Venture exchange and other filing fees in an effort to become a publicly traded company.

• ii) Management fees of $8,500 related to fees paid for the CEO’s services during the period.

• iii) Professional fees of $70,900 for legal and accounting fees during the period.

The Company incurred a loss and comprehensive loss for the three months ended April 30, 2021 of $61,491 which consists of:

• i) Filing and regulatory fee of $14,180 which consists of fees paid the TSX Venture exchange and other filing fees in an effort to become a publicly traded company.

• ii) Management fees of $5,500 for fees paid for the CEO’s services.

• iii) Professional fees of $40,938 for legal and accounting fees.

Summary of Quarterly Results

The following is a summary of the Company’s financial results for the eight most recently completed quarters which have been prepared using accounting policies consistent with IFRS:

	Three months ended April 30, 2021 Three months ended January 31, 2021 From incorporation on July 28, 2020 to October 31, 2020
Interest Income	$- $- $-
Exploration and Evaluation Assets	122,056 117,809 113,287
Deficit	131,872 57,341 13,040
Net Loss	(61,491) (57,341) (13,040)
Basic and Diluted Loss Per Share	(0.01) (0.01) (0.00)

The Company was incorporated on July 28, 2020 any prior data is not available

Liquidity and Capital Resources

At April 30, 2021, the Company had cash of $479,500 (October 31, 2020 - $250,210) and a working capital of $449,131 (October 31, 2020 - $215,217).

The Company expects its current capital resources will not be sufficient to meet its business objectives or day-to-day operations through its next quarter or current operating year, and that its continuation as a going concern will be dependent on its ability to raise additional funds through equity issuances. There is no guarantee the Company will be successful in that regard. See “Overview and Going Concern” above.

During the six months ended April 30, 2021, the Company had the following cash flows:

• i) Net cash used in operating activities of $123,456 which consists of the cash paid for expenses on the statement of loss and comprehensive loss.

• ii) Net cash used in investing activities of $8,769 which consists of cash paid for exploration and evaluation of its mineral property.

• iii) Net cash provided by financing activities of $361,515 which consists of cash received from completion of initial public offering.

During the six months ended April 30, 2021, the Company completed its initial public offering (“IPO”) in which it distributed 3,000,000 common shares of the Company at a price of $0.15 per common share for aggregate gross proceeds of $450,000. The Company paid $88,485 in finders fees and share issuance costs and issued 240,000 agent warrant finder fees exercisable at $0.15 for 2 years with a fair value of $25,600. The fair value was calculated using the Black-Scholes option pricing model using a 150% volatility, a 0.27% discount rate, a market price of $0.15, a 2 year expected life and an annual dividend rate of NIL.

Risks and Uncertainties

The Company is in the mineral exploration and development business and, as such, is exposed to a number of risks and uncertainties that are not uncommon to other companies in the same business. Some of the possible risks include the following:

• a) The industry is capital intensive and subject to fluctuations in metal prices, market sentiment, foreign exchange and interest rates. The recovery of the Company’s investment in exploration and evaluation assets and the attainment of profitable operations are dependent upon the discovery and development of economic ore reserves and the ability to arrange sufficient financing to bring the ore reserves into production.

• b) The most likely sources of future funds for further acquisitions and exploration programs undertaken by the Company are the sale of equity capital and the offering by the Company of an interest in its properties to be earned by another interested party carrying out further exploration or development. If such exploration programs are successful, the development of economic ore bodies and commencement of commercial production may require future equity financings by the Company, which are likely to result in substantial dilution to the holdings of existing shareholders.

• c) The Company’s capital resources are largely determined by the strength of the resource markets and the status of the Company’s projects in relation to these markets, and its ability to compete for the investor support of its projects.

• d) The prices of metals greatly affect the value and potential value of its exploration and evaluation assets. This, in turn, greatly affects its ability to raise equity capital, negotiate option agreements and form joint ventures.

• e) The Company must comply with health, safety, and environmental regulations governing air and water quality and land disturbances and provide for mine reclamation and closure costs. The Company’s permission to operate could be withdrawn temporarily where there is evidence of serious breaches of such regulations, or even permanently in the case of extreme breaches. Significant liabilities could be imposed on the Company for damages, clean-up costs or penalties in the event of certain discharges into the environment, environmental damage caused by previous owners of acquired properties or noncompliance with environmental laws or regulations.

• f) The operations of the Company will require various licenses and permits from various governmental authorities. There is no assurance that the Company will be successful in obtaining the necessary licenses and permits to continue exploration and development activities in the future.

• g) Although the Company has taken steps to verify title to exploration and evaluation assets in which it has an interest, these procedures do not guarantee the Company’s title. Such assets may be subject to prior agreements or transfers and title may be affected by such undetected defects.

Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, then actual results may vary materially from those described in any forward looking statement. The development and exploration activities of the Company are subject to various laws governing exploration, development, and labour standards which may affect the operations of the Company as these laws and regulations set various standards regulating certain aspects of health and environmental quality. They provide for penalties and other liabilities for the violation of such standards and establish, in certain circumstances, obligations to rehabilitate current and former facilities and locations where operations are, or were conducted.

Financial Risk Factors

The Company’s financial instruments consist of cash, accounts payable and accrued liabilities. The fair value of these financial instruments, other than cash, approximates their carrying values due to the short-term nature of these instruments. Cash is measured at fair value using level 1 inputs.

The Company is exposed to a variety of financial risks by virtue of its activities including currency, credit, interest rate, liquidity and commodity price risk.

a) Foreign currency risk

The Company is exposed to nominal foreign currency risk.

b) Credit risk

Credit risk is risk of financial loss to the Company if the counterparty to a financial statement fails to meet its contractual obligations. The Company’s cash is held in large Canadian financial institutions and is not exposed to significant credit risk.

c) Interest rate risk

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is exposed to limited interest rate risk as it only holds non-interest bearing debt.

d) Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its obligations as they come due. At April 30, 2021, the Company had cash of $479,500 (October 31, 2020 - $250,210) and current liabilities of $50,475 (October 31, 2020 - $40,095). This emphasizes that the Company’s ability to continue as a going concern is dependent on management’s ability to raise the required capital through future equity or debt issuances. See “Liquidity and Capital Resources” above. There is no guarantee that the Company will be able to raise capital. The Company manages its liquidity risk by forecasting cash flows from operations and anticipating any investing and financing activities. Management and the directors are actively involved in the review, planning, and approval of significant expenditures and commitments.

e) Price risk

The ability of the Company to explore and develop its exploration and evaluation assets and the future profitability of the Company are directly related to the price of natural resource commodities. The Company monitors these prices to determine the appropriate course of action to be taken.

Related Party Transactions

Transactions with related parties and key management personnel are as follows:

Nature of transactions	Period ended April 30, 2021 Period from incorporation on July 28, 2020 to October 31, 2020
Paid or accrued to the CEO and director Management fees Paid or accrued to a partnership in which the CFO has an interest Professional fees Total	$ 8,500 $ 1,500 7,500 3,500
	$ 16,000 $ 5,000

The amounts due to other related parties and key management personnel included in accounts payable and accrued liabilities are as follows:

	As at April 30, 2021 As at October 31, 2020
Due to the CEO and director Due to the CFO and director, for exploration costs paid on behalf of Company Due to a partnership in which the CFO has an interest	$ 8,317 $ 1,313 - 17,187 11,150 3,500
	$ 19,467 $ 22,000

The amounts due to related parties are unsecured non-interest bearing and are due on demand.

Off Balance Sheet Arrangements

The Company is not a party to any off balance sheet arrangements or transactions.

Changes in Accounting Policies and Future Accounting Pronouncements

Please refer to the condensed interim financial statements for the six months ended April 30, 2021 located on www.sedar.com.

Contingencies

There are no contingent liabilities.

Management’s Responsibility for Financial Statements

The information provided in this report, including the financial statements, is the responsibility of management. In the preparation of these statements, estimates are sometimes necessary to make a determination of future values for certain assets or liabilities. Management believes such estimates have been based on careful judgements and have been properly reflected in the financial statements.

Share capital

As at June 30, 2021, the Company had the following outstanding:

Common shares – 11,636,344 outstanding

Stock options:

	Exercise
Options Outstanding	Price	Expiry Date
240,000	$0.15	15-Apr-23
240,000