Q2 Financial Statements 2025

(expressed in Canadian dollars) (unaudited)

Management's Comments on Unaudited Condensed Interim Consolidated Financial Statements

These unaudited condensed interim consolidated financial statements of Forsys Metals Corp. (the "Company") have been prepared by management and approved by the Board of Directors of the Company.

These unaudited condensed interim consolidated financial statements have not been reviewed by the Company's external auditors.

(expressed in Canadian dollars) (unaudited)

Liabilities

Current

(expressed in Canadian dollars) (unaudited)

(expressed in Canadian dollars) (unaudited)

Cash from (used in) Operating activities

6 months ended June 30,

2025 2024

Notes $ $

Net loss (1,053,204) (1,379,975)

Interest income (46,164) (193,483)

Item not affecting cash

Stock-based compensation - 343,378

Changes in non-cash operating working capital

(expressed in Canadian dollars) (unaudited)

1. Nature of operations

   Forsys Metals Corp. and its subsidiary companies (collectively the "Company") are engaged in the acquisition, exploration and development of mineral properties located in Namibia, Africa. The Company's principal focus is on bringing its wholly owned Norasa Uranium Project ("Norasa") into production. Norasa is the consolidation of the Valencia uranium project ("Valencia") and Namibplaas uranium project ("Namibplaas").

   As an exploration stage company, the Company's income is limited to interest income and other incidental income. The recoverability of the amount shown for mineral properties, exploration and evaluation costs is dependent upon, but not limited to the existence and economic recovery of mineral reserves in the future; the ability to obtain necessary permits and financing to complete the exploration and development of these properties; government policies and regulations; and attaining profitable production or proceeds from the disposition of properties. The Company may be adversely affected by governmental amendments or changes to mining laws, regulations and requirements in Namibia.

   The Company is incorporated under the Business Corporations Act (Ontario) and the primary listing of its common shares is on the Toronto Stock Exchange, with secondary listings on the Namibian Stock Exchange and Frankfurt Stock Exchange. The Company's registered office is at 20 Adelaide Street East, Suite 200, Toronto, Ontario, Canada, M5C 2T6.

2. Going concern

   These consolidated financial statements are prepared on the going concern basis which assumes the continuity of normal business activity and the realization of assets and settlement of liabilities in the normal course of business.

3. Basis of presentation Statement of compliance

   These condensed interim consolidated financial statements have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting, using accounting policies consistent with International Financial Reporting Standards and its interpretations adopted by the International Accounting Standards Board.

   The accounting policies used in these condensed interim consolidated financial statements are consistent with those disclosed in the Company's audited consolidated financial statements for the year ended December 31, 2024.

   These condensed interim consolidated financial statements do not include certain information and disclosures normally included in annual financial statements prepared in accordance with IFRS and should be read in conjunction with the Company's annual financial statements for the year ended December 31, 2024.

   These condensed interim consolidated financial statements were approved and authorized for issue by the Board of Directors on August 13, 2025.

4. Cash and cash equivalents

   	June 30, 2025 $	December 31, 2024 $
   Cash at bank	1,354,159	1,793,384
   Cash on deposit	3,126,334	1,535,950
   	4,480,493	3,329,334

5. Exploration and evaluation

   	$
   Norasa
   Balance, December 31, 2024	17,955,477
   Additions to exploration and evaluation	1,901,051
   Foreign exchange movement	158,583
   Balance, June 30, 2025	20,015,111

   Norasa Uranium Project

   The Norasa Uranium Project is the consolidation of the Valencia Uranium Project and the Namibplaas Uranium Project in Namibia.

   Valencia Uranium Project

   Through its wholly owned subsidiary Valencia Uranium (Proprietary) Limited ("Valencia"), the Company holds Mining Licence 149 for the Valencia Uranium Project ("ML149"). ML149 was granted effective June 23, 2008 for a period of 25 years until June 22, 2033.

   ‌Namibplaas Uranium Project

   Through Valencia, the Company holds Exclusive Prospecting Licence 3638 for Namibplaas ("EPL 3638"). EPL 3638 was renewed on February 1, 2024 for a period of 2 years until February 1, 2026.

   ‌Lease with an option to purchase

   On May 15, 2025, Valencia entered into a lease with the purchaser ("Lessor") of the shares of a company that owns Portion-1 of Farm Namibplaas No. 93 ("Property"), which covers approximately 6,700 hectares, including 1,179 hectares that is covered by EPL 3638. The Lessor agreed to pay N$24,000,000 to the vendor and Valencia guaranteed the obligations of the Lessor to the vendor.

   Under the terms of the lease agreement, Valencia will have the right of occupation of the Property and an option to purchase the Property ("Option"), in return for providing a loan to the Lessor under the following terms:

   Commencement Date	July 25, 2025, the date upon which the Lessor completed the acquisition of the Property.
   Term	Earliest of the termination by Valencia, exercise of the purchase option and 10 years from the Commencement Date.
   Loan	The lease provides for Valencia to advance a loan to the Lessor:
   	Advances	N$7,000,000 which was advanced on May 15, 2025, and thereafter, a further N$17,000,000 in 17 monthly advances of N$1,000,000 commencing on the Commencement Date.
   	Interest rate	None.
   	Repayment	To be negotiated, however, upon exercise the Purchase option, the loan will be offset against the purchase price of the property or shares of the company holdinq the title deed.
   Payment of costs	Valencia will pay all operating, administrative, interest and tax costs incurred by the Lessor in respect of the Property.
   Purchase option	Valencia will have the option to purchase the Property or the outstanding shares of the Lessor for par value of N$1 per share.

   A continuity of a loan receivable advanced prior to the Commencement Date of July 25, 2025 is presented below:

   	N$	$
   Balance, December 31, 2024	-	-
   Advances
   Initial	7,000,000	538,300
   Payment of property transfer costs	416,441	32,024
   Balance, June 30, 2025	7,416,441	570,324

   Impairment

   At December 31, 2024 and June 30, 2025, the Board reviewed the carrying value of the capitalized exploration and evaluation of Norasa. The Board considered the impairment indicators contained within IFRS 6 and concluded that no impairment indicators have been identified.

   Share capital

   ‌Authorized

   An unlimited number of Class A common shares without par value

   An unlimited number of redeemable, voting non-participating Class B shares

   An unlimited number of Class C shares with rights and privileges to be determined by the Company's Board of Directors

   ‌Issued

   	Number of Class A common shares	Amount $
   Balance, December 31, 2024	200,319,467	176,207,588
   Private placement of units	10,010,000	5,005,000
   Fair value of warrants issued	-	(1,136,000)
   Share issue costs	-	(80,906)
   Exercise of PSUs	350,000	209,720
   Balance, June 30, 2025	210,679,467	180,205,402

   ‌Private placement of units‌

   On February 21, 2025, the Company completed a private placement of 10,010,000 units at a price of $0.50 per unit for gross proceeds of $5,005,000. Each unit consisted of one Class A common share and one warrant entitling the holder to purchase one Class A common share for $0.75 until February 21, 2027. Directors and officers of the Company subscribed for the entirety of the private placement.

   The fair value of the unit warrants was calculated using the Black-Scholes option pricing model with the following assumptions:

   Issue date	February 21, 2025
   Expiry date	February 21, 2027
   Warrants issued	10,010,000
   Exercise price	$0.75
   Share price	$0.44
   Risk-free interest rate	2.73%
   Expected volatility based on historical volatility	54%
   Expected life of warrants	2 years
   Expected dividend yield	0%
   Fair value	$1,136,000
   Fair value per warrant	$0.11

   The Company has not issued any Class B or Class C shares.

6. Warrants

   	Weighted-average exercise price $	Number of warrants outstanding and exercisable
   Balance, December 31, 2024	-	-
   Issued (note, 6, Share capital, Private placement of units)	0.75	10,010,000
   Balance, June 30, 2025	0.75	10,010,000

7. Incentive plan

   The Company has an Amended and Restated Omnibus Incentive Plan (the "Plan") that permits the Board to make awards of stock options, restricted share units, performance share units and deferred stock units. The maximum number of Class A common shares for issuance under the Plan will not exceed 10% of the Company's then issued and outstanding shares. At June 30, 2025, the maximum number of Class A common shares for issuance under the Plan is 21,067,946.

   Stock options

   All stock options granted under the Plan have an exercise price determined and approved by the Board at the time of grant, which shall not be less than the closing price of the Class A common shares on the TSX on the trading day immediately preceding the date of the granting of the option. Subject to any vesting conditions set forth in a participant's grant agreement, options vest in equal portions in successive annual periods over a period of three years after they are granted. Options are exercisable during a period established by the Board which shall not be more than 10 years from the grant of the option.

   A continuity of the activity in the Company's stock options is presented below:

   	Weighted-average exercise price $	Number of stock options outstanding and exercisable
   Balance, December 31, 2024	0.74	9,350,000
   Cancelled	0.76	(1,650,000)
   Balance, June 30, 2025	0.73	7,700,000

   A summary of the Company's stock options outstanding and exercisable as at June 30, 2025 is presented below:

   Exercise price	Expiry date	Number of stock options outstanding and exercisable
   $0.93	May 20, 2026	3,250,000
   $0.59	September 20, 2028	4,450,000
   		7,700,000

   ‌Performance share units, restricted share units and deferred stock units

   A continuity of the number of the Company's performance share units outstanding at June 30, 2025 is presented below:

   	Vested	Unvested	Total
   Balance, December 31, 2024	2,350,000	650,000	3,000,000
   Exercised	(350,000)	-	(350,000)
   Balance, June 30, 2025	2,000,000	650,000	2,650,000

   ‌A summary of the number of the Company's performance share units outstanding at June 30, 2025 is presented below:

   			Number of PSUs
   	Vesting condition	Status	outstanding
   PSU 1	Vest in full upon the Company's share price reaching $0.80	Vested	1,750,000
   PSU 2	Vest in full upon granting of an EPL for Namibplaas	Vested	250,000
   PSU 3	Vest in full upon the granting of a Mining Licence for Namibplaas	Unvested	650,000
   			2,650,000

   PSU 3

   The achievement of the vesting condition of granting of a Mining Licence for Namibplaas is dependent on a number of variables being satisfied. As a result, as at the reporting date, given the uncertainty, the Company has assessed the probability of achieving this vesting condition as not probable of being achieved within the required timeframe and no stock-based compensation has been recognized for this tranche.

   Restricted share units and deferred stock units

   At June 30, 2025, the Company has not issued any restricted share units or deferred stock units.

8. Financial risk management

   ‌The Company's activities expose it to a variety of risks arising from financial instruments. These risks, and management's objectives, policies and procedures for managing these risks, are discussed below.

   1. ‌Credit risk‌

      Credit risk is the risk of loss associated with a counter party's inability to fulfil its payment objectives. The Company's credit risk primarily relates to cash and cash equivalents.

      ‌The Company manages its credit risk over cash and cash equivalents by purchasing short-term investment grade securities, such as banker's acceptances and bank deposit notes issued by Canadian banks. Under the Company's risk management policy, allowable counterparty exposure limits are determined by the level of the rating unless exceptional circumstances apply. A rating of "A"- grade or equivalent is the minimum allowable rating required as assessed by international credit rating agencies.

   2. ‌Liquidity risk‌

      Liquidity risk is the risk that the Company will not have sufficient cash resources to meet its financial liabilities as they come due. The Company's approach to managing its liquidity risk is to prepare company-wide rolling cash forecasts to determine the funding required to support the Company's normal operating activities on an ongoing basis.

      ‌At June 30, 2025, the Company had working capital of $5,399,323, calculated as follows:

      	$
      Current assets	5,590,363
      Current liabilities	191,040
      	5,399,323

   3. ‌Market risk‌

      Market risk is the risk that changes in market price, foreign exchange rates and interest rates will affect the Company's future cash flows and earnings. The impact of each of these components is discussed below.

      ‌Price risk - The Company is not exposed to equity securities price risk.

      ‌Interest rate risk - Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. At June 30, 2025, the Company's exposure to the risk of changes in market interest rates relates primarily to the Company's cash and cash equivalents held in bank accounts that earn variable interest rates. Because of the short-term nature of these financial instruments, fluctuations in market rates do not have a significant impact on estimated fair values at June 30, 2025. Future cash flows from interest income on cash will be affected by interest rate fluctuations. Future fluctuations in interest rates will impact the Company's cost of capital which it will require in order to develop its mineral properties.

      ‌Foreign currency risk - The Company's foreign currency exposures currently related to the currency in which expenses for exploration and development occur. Future profitability may be materially impacted by fluctuations between the Namibian dollar in which production costs will be incurred and the US dollar in which most sales of uranium occur. Expenses are incurred in Canadian dollars, United States dollars, Namibian dollars, Australian dollars, Euros and British Pounds. The Company is subject to gains and losses due to fluctuations in these currencies.

      ‌US dollars‌

      At June 30, 2025, the Company had cash and cash equivalents of US$21,677.

      ‌Namibian dollars‌

      At June 30, 2025, the Company had cash and cash equivalents of N$17,609,350 (Canadian dollar equivalent - $1,354,159), receivables of N$2,144,604 (Canadian dollar equivalent - $164,920) and accounts payable and accrued liabilities of N$1,871,823 (Canadian dollar equivalent - $143,943). If the foreign exchange rate related to the Company's Namibian dollar balances increased or decreased by 1%, with all other variables held constant, the currency translation adjustment would have increased or decreased by $13,750.

9. ‌Capital management

   The Company's objective when managing capital resources is to ensure it has sufficient capital to support its ongoing operations including a sufficient level of funds to support continued exploration and development in Namibia and to provide returns for shareholders and benefits for other stakeholders.

   ‌The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the risk characteristics of the Company's assets. The Board of Directors of the Company has not yet made a formal decision to commence the development of Norasa, which decision, remains subject to, amongst other factors, suitable financing arrangements and prevailing market and economic conditions. Management will consider the issue of senior debt, convertible investments, other financial instruments and the introduction of strategic partners as a means to finance development of Norasa while minimizing equity dilution.

   ‌As of June 30, 2025, the Company is not subject to any externally imposed capital requirements and there has been no change during the year with respect to the overall capital risk management strategy.

10. ‌Related party transactions Compensation of key management personnel

    Key management personnel as defined under IFRS are those persons having authority and responsibility for planning, directing and controlling the activities of the Company, directly or indirectly. Key management personnel include the Company's Chief Executive Officer, Chief Financial Officer, Investor Relations and members of the Company's Board of Directors.

    ‌Compensation awarded to key management personnel is as follows:

    6 months ended June 30,
    	2025 $	2024 $
    Director fees	316,916	305,951
    Consulting fees	302,969	250,537
    Stock-based compensation	-	151,170
    	619,885	707,658

11. ‌Segment information

    An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, whose operating results are reviewed regularly by the Company's chief operating decision maker, the Chief Executive Officer and for which discrete financial information is available. The Company has determined that it has one operating segment, the acquisition, exploration and development of uranium and gold mineral properties, all of which are currently located in Namibia. The Company's corporate head office earns nominal interest income which is considered incidental to the activities of the Company and therefore does not meet the definition of an operating segment.

    ‌Non-current assets excluding financial assets by geographic area are as follows:

    	June 30, 2025 $	December 31, 2024 $
    Namibia	20,015,111	17,955,477

12. ‌Events occurring after the reporting period

At the date of this report, except as outlined below, there are no other matters or circumstances which have arisen since June 30, 2025 that have significantly affected or may significantly affect operations, results of operations or the state of affairs of the Company.