Newcore Gold — Interim / Quarterly Report 2021

Aug 18, 2021

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CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Expressed in Canadian Funds - Unaudited)

For the Six Months Ended June 30, 2021

Newcore Gold Ltd. CONSOLIDATED BALANCE SHEETS

(Expressed in Canadian Funds - Unaudited)

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June 30, December 31,
2021 2020
ASSETS
Current assets
Cash and cash equivalents $ 1,122,204 $ 1,276,159
Short-term investment 2,645,900 11,935,900
GST and other receivables 34,082 40,040
Prepaid expenses 291,592 304,001
4,093,778 13,556,100
Non-current assets
Loan receivable (Note 6(a)) 68,750 106,250
Other assets 153,958 79,654
Exploration and evaluation assets (Note 4) 27,006,377 17,380,916
$ 31,322,863 $ 31,122,920
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Trade and other payables $ 2,477,653 $ 1,470,385
Non-current liability
Provision for bonus payment 112,457 112,457
2,590,110 1,582,842
Shareholders’ equity
Share capital (Note 5) 29,509,582 28,812,060
Share-based payments reserve 3,429,500 2,516,642
Warrants reserve 2,460,252 2,460,252
Accumulated other comprehensive income 1,962,743 2,459,579
Accumulated deficit (8,629,324) (6,708,455)
28,732,753 29,540,078
$ 31,322,863 $ 31,122,920
Nature of operations (Note 1)
Subsequent Event (Note 10)
On behalf of the Audit Committee:
“Douglas Forster” Director “Edward Farrauto” Director
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The accompanying notes are an integral part of these condensed interim consolidated financial statements.

Newcore Gold Ltd.

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Expressed in Canadian Funds - Unaudited) FOR THE SIX MONTHS ENDED JUNE 30, 2021 AND 2020

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Common shares
Share-based Accum. other
payments Warrants comprehensive Accumulated
Number Amount reserve reserves income deficit Total
Balance – January 1, 2020 62,566,547 $ 11,681,023 $ 1,738,250 $ 2,460,252 $ 2,870,881 $ (4,496,467) $ 14,253,941
Issuance of common shares:
on private placement 15,000,000 2,949,199 - - - - 2,949,199
on finder's fees 128,500 - - - - - -
Exercise of options 2,250,000 303,174 (78,174) - - - 225,000
Share-based compensation - - 72,868 72,868
Foreign currency translation - - - - 547,930 - 547,930
Net loss for the period - - - - - (242,851) (242,851)
Balance – June 30, 2020 79,945,047 $ 14,933,396 $ 1,732,945 $ 2,460,252 $ 3,418,811 $ (4,739,317) $ 17,806,088
Issuance of common shares:
on private placement 18,750,000 15,050,801 - - - - 15,050,801
Share issuance costs (1,212,560) (1,212,560)
Exercise of options 300,001 40,423 (10,423) - - - 30,000
Share-based compensation - - 794,119 794,119
Foreign currency translation - - - - (959,232) - (959,232)
Net loss for the period - - - - - (1,969,138) (1,969,138)
Balance – December 31, 2020 98,995,048 $ 28,812,060 $ 2,516,642 $ 2,460,252 $ 2,459,579 $ (6,708,455) $ 29,540,078
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Balance – January 1, 2021 Share-based compensation Exercise of options Issued for services Foreign currency translation Net loss for the period Balance – June 30, 2021

Number Amount Share-based payments reserve Warrants reserves Accum. other comprehensive income Accumulated deficit Total 98,995,048 $ 28,812,060 $ 2,516,642 $ 2,460,252 $ 2,459,579 $ (6,708,455) $ 29,540,078 - - 975,931 - - - 975,931 200,000 143,073 (63,073) - - - 80,000 901,568 554,449 - - - - 554,449 - - - - (496,836) - (496,836) - - - - - (1,920,869) (1,920,869) 100,096,616 $ 29,509,582 $ 3,429,500 $ 2,460,252 $ 1,962,743 $(8,629,324) $ 28,732,753 Common shares

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

Newcore Gold Ltd.

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS (INCOME) (Expressed in Canadian Funds - Unaudited)

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For the Three For the Three For the Six For the Six
Months Ended Months ended Months Ended Months ended
June 30, 2021 June 30, 2020 June 30, 2021 June 30, 2020
EXPENSES
Accounting and audit fees $ 44,361 $ 10,093 $ 55,406 $ 18,488
Amortization 1,466 - 1,466 -
Consultants 28,616 - 73,365 -
Foreign exchange (gain) loss 55,780 8,685 71,528 18,967
Insurance 3,723 7,935 27,249 15,870
Legal 24,500 9,767 71,102 10,137
Management fees 109,723 44,128 349,414 50,128
Office 22,608 8,388 48,518 13,708
Share-based compensation 428,734 72,049 896,767 72,049
Shareholder relations, marketing and conferences 65,370 31,119 300,284 31,899
Transfer agent and regulatory fees 11,037 3,527 26,159 10,280
Travel 11,774 - 14,999 11,295
807,692 $ 195,691 $ 1,936,257 $ 252,821
OTHER INCOME
Interest income (11,808) - (15,388) (9,970)
Loss for the period 795,884 $ 195,691 $ 1,920,869 $ 242,851
Items that will be reclassified subsequently to profit or loss:
Foreign currency translation 309,334 480,774 496,836 (547,930)
Comprehensive loss (income) for the period 1,105,218 676,465 2,417,705 (305,079)
Loss per share – basic and diluted 0.01 $ 0.00 $ 0.02 $ 0.00
Weighted average number of shares outstanding:
Basic and diluted 99,206,091 66,576,662 99,101,153 64,693,180
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The accompanying notes are an integral part of these condensed interim consolidated financial statements.

Newcore Gold Ltd.

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS (Expressed in Canadian Funds - Unaudited) FOR THE SIX MONTHS ENDED JUNE 30

	2021 2020
CASH PROVIDED BY (USED IN): Cash flows from operating activities: Net loss for the period Non-cash item: Amortization Unrealized foreign exchange Share-based compensation Changes in non-cash working capital: Trade and other receivables Prepaid expenses Trade and other payables Cash flows from investing activities: Redemption of short-term investment Loan to related party Exploration and evaluation costs Cash flows from financing activities: Proceeds from share issuances Share issuance costs Exercise of stock options Effect of exchange rate on cash Increase (decrease) in cash Cash – beginning of period Cash – end ofperiod	$ (1,920,869) $ (242,851) 1,466 - (40,454) 3,429 896,767 72,049 5,958 (8,638) 12,409 (117,195) (1,332,954) (124,139)
	(2,377,677) (417,345) 9,290,000 (2,329,000) 37,500 (143,750) (7,148,462) (132,595)
	2,179,038 (2,605,345) - 3,000,000 - (50,801) 80,000 225,000
	80,000 3,174,199 (35,316) (6,916)
	(153,955) 144,593 1,276,159 92,386
	$ 1,122,204 $ 236,979

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

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Expressed in Canadian Funds - Unaudited) FOR THE SIX MONTHS ENDED JUNE 30, 2021

Newcore Gold Ltd.

1. NATURE OF OPERATIONS

Newcore Gold Ltd. (formerly Pinecrest Resources Ltd.) and its subsidiary (collectively, “Newcore” or the “Company”) engage principally in the acquisition, advancement, and development of precious mineral properties, particularly its Enchi Gold Project in Ghana. Newcore Gold Ltd., the parent, was incorporated pursuant to the provisions of the Business Corporations Act (British Columbia) on January 18, 2010. Newcore is a public company listed on the TSX Venture Exchange (the “Exchange”) (TSX-V: NCAU) and also trades on the OTCQX (OTCQX: NCAUF). Its head office is located at 413 – 595 Burrard Street, P.O. Box 49167, Vancouver, British Columbia, V7X 1J1.

2. BASIS OF PRESENTATION

These unaudited condensed interim consolidated financial statements have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting. They do not include all of the information and footnotes required by the IFRS as issued by the International Accounting Standards Board for full annual financial statements and should be read in conjunction with the Company’s annual consolidated financial statements for the year ended December 31, 2020. The same accounting policies and methods of computation are used in the preparation of these unaudited condensed interim consolidated financial statements as for the most recent audited annual financial statements and reflect all the adjustments necessary for fair presentation in accordance with IFRS for the interim periods presented.

The unaudited condensed interim consolidated financial statements were authorized for issue by the Audit Committee on August 18, 2021.

3. SIGNIFICANT JUDGMENTS, ESTIMATES AND ASSUMPTIONS

The preparation of financial statements in conformity with IFRS requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reported periods. Actual results could differ from those estimates. Significant areas where management judgment is applied in these financial statements include the impairment of exploration and evaluation assets and the valuation of options and warrants (which are based upon expected useful lives and other relevant assumptions).

Newcore Gold Ltd.

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Expressed in Canadian Funds - Unaudited) FOR THE SIX MONTHS ENDED JUNE 30, 2021

4. EXPLORATION AND EVALUATION ASSETS

Acquisition costs Balance, beginning of period Balance, end of period Exploration and evaluation expenditures Balance, beginning of period Camp costs Consulting Drilling Equipment and software Geological General and administration Management fees Mining permits and licenses Professional fees Public relations Resource estimate Salaries and wages Share-based compensation Travel and lodging Vehicle rental Balance, end of period Foreign exchange impact Total exploration and evaluation assets	June 30, 2021 December 31, 2020
	$ 8,356,926 $ 8,356,926
	$ 8,356,926 $ 8,356,926 $ 6,635,260 $ 2,750,124 127,446 69,615 8,579 124,088 7,452,339 2,612,711 - 84,870 622,254 198,334 6,531 3,134 866,234 311,760 82,161 67,459 2,106 838 24,773 2,139 219,124 97,102 628,521 182,490 79,164 32,236 - 2,754 115,643 95,606
	$ 16,870,135 $ 6,635,260 1,779,316 2,388,730
	$ 27,006,377 $ 17,380,916

5. SHARE CAPITAL

The authorized share capital of the Company is comprised of an unlimited number of common and preferred shares without par value.

Private Placements

On June 17, 2020, the Company completed a non-brokered private placement for gross proceeds of $3,000,000 through the issuance of 15,000,000 common shares (“Shares”) of the Company at a price of $0.20 per share (the “Private Placement”). The Company paid and issued to arm’s length parties finder’s fees in the amount of $6,750 and 128,500 Shares, respectively. Total share issue costs in connection with the Private Placement amounted to $50,801. Insiders of the Company subscribed for a total of 5,300,000 Shares in the Private Placement.

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Expressed in Canadian Funds - Unaudited) FOR THE SIX MONTHS ENDED JUNE 30, 2021

Newcore Gold Ltd.

5. SHARE CAPITAL – cont’d.

On November 4, 2020, the Company completed a bought deal prospectus offering (the "Offering") led by Haywood Securities Inc. and Stifel GMP (acted as co-lead underwriters) and joint book-runners, on behalf of a syndicate of underwriters that included Cormark Securities Inc., Raymond James Ltd., and Sprott Capital Partners LP (collectively, the "Underwriters"). Pursuant to the Offering, the Company issued a total of 18,750,000 common shares of the Company (the "Common Shares") at a price of $0.80 per Common Share for gross proceeds to the Company of $15,000,000. The Common Shares were offered by way of a short form prospectus in British Columbia, Alberta, and Ontario. In connection with the Offering, the Underwriters received a cash commission of 5% of the gross proceeds of the Offering up to $8 million and 6% of the gross proceeds of the Offering above $8 million (reduced to 2% in respect of sales to purchasers on the president’s list which accounted for gross proceeds of $1 million).

Long-term Incentive Plan

Effective August 19, 2020, the Company adopted a long-term incentive plan (the “Incentive Plan”). The purpose of the Incentive Plan is to attract, retain and motivate persons of training, experience and leadership as directors, officers, employees and consultants of the Company and to promote a greater alignment of interests between such persons and shareholders of the Company. The Incentive Plan is administered by the Board who are tasked with the responsibility to interpret and construe the Incentive Plan, including determining the times when awards are granted, to whom, the number of awards granted, the length of the exercise period and the vesting provisions involved in awards granted, subject to the terms of the Incentive Plan, applicable securities laws and regulatory requirements. The aggregate number of shares to be reserved and set aside for issue upon the exercise or redemption and settlement for all awards granted under the Incentive Plan is fixed at 16,000,000, of which up to a maximum of 3,000,000 shares may be set aside for issue upon the exercise or redemption and settlement of Deferred Share Units (“DSUs”), Performance Share Units (“PSUs”), and Restricted Share Units (“RSUs”), collectively, the “Share Unit Awards”. The Share Unit Awards can be settled through a delivery of cash, common shares, or any combination thereof, at the sole discretion of the Board. As the Company intends to settle any vested Share Unit Award through the issuance of common shares, Newcore has accounted for these awards as equity-settled instruments. To date, the Company has not granted any DSUs under the Incentive Plan.

Stock Options

A summary of the Company’s stock options as of June 30, 2021 is as follows:

						Remaining	Number of
Exercise	January 1,			June 30,		contractual	options
price	2021	Granted	Exercised	2021	Expiry date	lifeinyears	vested
$0.45	2,350,000	-	150,000	2,200,000	April 13, 2022	0.79	2,350,000
$0.53	249,999	-	-	249,999	May 24, 2022	0.90	249,999
$0.25	4,450,000	-	50,000	4,400,000	May 19, 2025	3.89	-
$0.79	1,500,000	-	-	1,500,000	August 20, 2025	4.14	-
$0.75	750,000	-	-	750,000	September 3, 2025	4.18	-
$0.61	100,000	-	-	100,000	December 15, 2025	4.46
	9,399,999	-	-	9,199,999			2,599,999
	$0.44	-	-	$0.44	Weighted average exercise price

During the six months ended June 30, 2021, the Company did not grant any stock options.

Restricted Share Units

As at June 30, 2021, there were 1,150,000 RSUs outstanding. During the six months ended June 30, 2021, the Company did not grant any RSUs.

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Expressed in Canadian Funds - Unaudited) FOR THE SIX MONTHS ENDED JUNE 30, 2021

Newcore Gold Ltd.

5. SHARE CAPITAL – cont’d.

Performance Share Units

As at June 30, 2021, there were 400,000 PSUs outstanding. During the six months ended June 30, 2021, the Company did not grant any PSUs.

Share-based Compensation

Options are priced using the Black-Scholes option pricing model. The Company amortizes the total fair value of options and RSUs granted over the graded vesting schedule. The fair value of PSUs is amortized over the straightline schedule. Consequently, the total compensation expense recognized for options, RSUs, and PSUs during the period was $507,838. Of the total compensation recorded, $468,033 was charged to operations and $39,805 was capitalized to mineral interests.

6. RELATED PARTY TRANSACTIONS

(a) Trading transactions

During the year ended December 31 31, 2020, Park Road Capital Corp. (the “Borrower”), a corporation controlled by the Company’s CEO and President, and the Company executed a loan agreement whereby the Company agreed to lend $150,000 to the Borrower (the “Loan”). The Loan is part of the total compensation package of the Company’s CEO and President. The interest free Loan is to be repaid in full by the Borrower before May 19, 2022. During the period ended June 30, 2021, the Borrower repaid $37,500 of the Loan.

(b) Compensation of key management personnel

Key management personnel include directors and officers that provide management and consulting services to the Company. Remuneration of key management personnel during the six months ended June 30 was as follows:

		2021		2020
Short-term salaries and benefits	$	104,412	$	-
Share-based compensation		868,513		69,593
Consultingfeespaid to keymanagement		245,002		50,128
	$	1,217,927	$	119,721

7. FAIR VALUE OF FINANCIAL INSTRUMENTS

(a) Financial Instruments by Category

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Other receivables and trade and other payables are the same as or approximately equal to their respective fair values due to their short-term maturity or capacity of prompt liquidation. The carrying values of the Company’s financial assets and financial liabilities are approximately equal to their fair values.

Newcore Gold Ltd. NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Expressed in Canadian Funds - Unaudited) FOR THE SIX MONTHS ENDED JUNE 30, 2021

7. FAIR VALUE OF FINANCIAL INSTRUMENTS – cont’d.

(b) 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 ensures there is sufficient capital to meet short-term business requirements. One of management’s goals is to maintain an optimal level of liquidity through the active management of the Company’s assets, liabilities, and cash flows. The Company’s cash which is held as cash deposits and short-term investment are available on demand to fund the Company’s short-term financial obligations.

(c) Credit Risk and Concentration Risk

The Company’s credit risk is primarily attributable to its cash, short-term investment, and loan receivable. The risk exposure is limited to their carrying values at the balance sheet date. Cash and short-term investments are held with counterparties that carry investment grade ratings as assessed by external rating agencies. The Company does not invest in asset-backed deposits or investments. Concentration risk exists in cash and short-term investments because significant balances are maintained with one financial institution. The risk is mitigated because the instruments are maintained with a large Canadian financial institution.

(d) Market Risks

The significant market risk to which the Company is exposed is interest rate risk. The Company’s interest rate risk arises primarily from the interest earned on cash and short-term investment. Deposits are invested on a short-term basis to enable adequate liquidity for payment of operational and capital expenditures. The Company’s short-term investments reflect funds invested in GIC’s. Other financial assets and liabilities of the Company are not subject to interest rate risk since they do not bear interest.

8. SEGMENTED INFORMATION

The Company’s business is the acquisition, exploration, evaluation, and development of mineral resource properties, which is currently conducted principally in Ghana. The Company is in the exploration stage and accordingly, has no reportable segment revenues for any of the periods presented in these condensed interim consolidated financial statements.

		June 30,		December 31,
		2021		2020
Canada
Total assets	$	3,184,683	$	13,121,712
Total liabilities	$	249,888	$	733,116
Ghana
Total assets	$	28,138,180	$	18,001,208
Total liabilities	$	2,340,222	$	849,726

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Expressed in Canadian Funds - Unaudited) FOR THE SIX MONTHS ENDED JUNE 30, 2021

Newcore Gold Ltd.

8. SEGMENTED INFORMATION – cont’d

The following geographic data denotes net losses based on their country of origin for the period ended June 30:

	2021	2020
Canada	$ 1,840,513	$ 220,127
Ghana	80,356	22,724
Loss for theperiod	$ 1,920,869	$ 242,851

9. CORONAVIRUS (COVID-19)

Since March 2020, several measures have been implemented in Canada and the rest of the world in response to the increased impact from novel coronavirus (“COVID-19”). We continue to operate our business and move our exploration plans forward at this time. While the impact of COVID-19 is expected to be temporary, the current circumstances are dynamic and the impacts of COVID-19 on our business operations, including the duration and impact on our future exploration plans, cannot be reasonably estimated at this time and we anticipate this could have an adverse impact on our business, results of operations, financial position and cash flows in 2021.

10. SUBSEQUENT EVENT

On August 4, 2021, the Company completed a bought deal prospectus offering (the "Offering") led by Cormark Securities Inc., as lead underwriter, on behalf of a syndicate of underwriters that included Stifel GMP, Raymond James Ltd., Haywood Securities Inc., and Sprott Capital Partners LP (collectively, the "Underwriters"). Pursuant to the Offering, the Company issued 19,167,050 common shares of the Company (the "Common Shares") at a price of $0.60 per Common Share for gross proceeds to the Company of $11,500,230. The Common Shares were offered by way of a prospectus supplement to the Company’s base shelf prospectus dated March 9, 2021. In connection with the Offering, the Underwriters received a cash commission of 6% of the gross proceeds of the Offering, reduced to 4% in respect of sales to purchasers on the president’s list which account for gross proceeds of $1 million. Certain directors and management of the Company purchased an aggregate of 396,669 Common Shares pursuant to the Offering.