Consolidated Financial Statements
Nine months ended September 30, 2024
(Expressed in Canadian dollars)
Unaudited
REGENX TECH CORP.
INDEX TO THE AUDITED CONSOLIDATED FINANCIAL STATEMENTS
For the Nine months Ended September 30, 2024 and 2023
Page | |
FINANCIAL STATEMENTS | |
Consolidated Statement of Financial Position | 1 |
Consolidated Statement of Loss and Comprehensive Loss | 2 |
Consolidated Statement of Changes in Shareholders' Equity | 3 |
Consolidated Statement of Cash Flows | 4 |
Notes to Consolidated Financial Statements | 5 - 26 |
NOTICE TO READER
Under National Instrument 51-102, Part 4, subsection 4.3(3)(a), if an auditor has not performed a review of the 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 consolidated financial statements have been prepared by and are the responsibility of the management. The statements incorporate the requirements of IAS 34 - Interim Financial Reporting.
The Company's independent auditor has not preformed a review of these interim financial statements in accordance with the standards established by the Chartered Professional Accountants of Canada for a review of interim financial statements by an entity's auditor.
REGENX TECH CORP.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION | |||
(Expressed in Canadian dollars) | |||
September 30, | December 31, | ||
Note | 2024 | 2023 | |
ASSETS | |||
Current assets | |||
Cash and cash equivalents | 21 | $238,483 | $304,656 |
Receivables | 4, 21 | 67,399 | 43,393 |
Assets held for sale | 87,324 | 87,324 | |
Due from related party | 7, 21 | 41,214 | 788,143 |
Prepaid expenses and deposits | 218,437 | 108,010 | |
Total current assets | 652,858 | 1,331,526 | |
Non-current assets | |||
Restricted Cash | 21 | 346,295 | - |
Minority interest | 6 | 2,432,843 | 3,471,588 |
Note receivable | 5 | 2,292,849 | 2,208,973 |
Equipment | 8, 11 | 3,435,493 | 3,548,540 |
Intangible assets | 9 | 117,713 | 331,854 |
Total non-current assets | 8,625,193 | 9,560,955 | |
TOTAL ASSETS | $9,278,050 | $10,892,481 | |
LIABILITIES | |||
Current liabilities | |||
Accounts payable and accrued liabilities | 10, 21 | $192,571 | $157,271 |
Current portion of lease liability | 11 | 202,485 | 177,757 |
CEBA Loan | 16 | - | 40,000 |
Total current liabilities | 395,056 | 375,028 | |
Non-Current liabilities | |||
Notes payable | 17 | 5,397,558 | 4,548,830 |
Lease liability | 11 | 320,536 | 456,898 |
Total non-current liabilities | 5,718,094 | 5,005,728 | |
TOTAL LIABILITIES | 6,113,150 | 5,380,756 | |
EQUITY | |||
Share capital | 12 | 59,271,419 | 56,080,740 |
Reserves | 13 | 9,956,255 | 9,891,974 |
Deficit | (66,062,774) | (60,460,989) | |
TOTAL EQUITY | 3,164,900 | 5,511,725 | |
TOTAL LIABILITIES AND EQUITY | $9,278,050 | $10,892,481 | |
Nature and continuance of operations (Note 1) | |||
Subsequent events (Note 22) |
On behalf of the Board:
"Harvey Granatier"Director"Greg Pendura"Director
The accompanying notes are an integral part of these consolidated financial statements. 1
REGENX TECH CORP.
CONSOLIDATED STATEMENTS OF LOSS (Expressed in Canadian dollars)
Three months | Three months | Nine months | Nine months | ||
ended | ended | ended | ended | ||
September 30, | September 20, | September 30, | September 30, | ||
Note | 2024 | 2023 | 2024 | 2023 | |
Income | |||||
Revenue | $40,694 | - | $40,694 | - | |
40,694 | - | 40,694 | - | ||
Expenses | |||||
Interest costs | 109,521 | $150,501 | 409,104 | $258,080 | |
Management and employee costs | 7 | 606,150 | 497,232 | 1,663,659 | 1,272,327 |
Office and general | 16,285 | 21,362 | 49,850 | 63,666 | |
Public listing costs | 124,820 | 89,449 | 323,715 | 235,764 | |
Professional fees | 40,538 | 248,650 | 240,500 | 482,103 | |
Project costs | 147,6449 | 254,689 | 563,983 | 518,477 | |
Share-based payments | 7, 13 | 14,643 | 413,562 | 123,168 | 503,538 |
Travel | 58,981 | 58,551 | 130,426 | 174,483 | |
1,118,587 | 1,733,996 | 3,505,405 | 3,508,438 | ||
Loss before other items | (1,077,893) | (1,733,996) | (3,463,711) | (3,508,438) | |
Other items | |||||
Interest income | 29,641 | 26,950 | 86,223 | 79,884 | |
Other income | - | - | 367 | 4 | |
Amortization | 8, 9 | (276,793) | (153,911) | (598,123) | (487,671) |
Foreign exchange gain (loss) | 18,378 | 73,344 | 10,567 | 70,728 | |
Gain (loss) on sale of assets | - | - | - | 19,371 | |
Gain (loss) from discontinued | |||||
operations | 21 | (598,363) | - | (598,363) | - |
Net loss for the year before | |||||
minority interests | (1,905,029) | (1,787,613) | (4,563,0540) | (3,826,122) | |
Loss attributed to minority | |||||
interests | 6 | (941,404) | (178,693) | (1,038,745) | (763,303) |
Loss attributed to shareholders | (2,846,433) | (1,966,306) | (5,601,785) | (4,589,425) | |
Basic and diluted income (loss) per | |||||
common share | 13 | $(0.01) | $(0.00) | $(0.01) | $(0.01) |
Weighted average number of | |||||
common shares outstanding | 395,508,853 | 176,155,968 | 395,508,853 | 174,230,968 | |
The accompanying notes are an integral part of these consolidated financial statements.
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REGENX TECH CORP.
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUIITY (Expressed in Canadian dollars)
Share Capital | ||||||
Number of | Minority | |||||
Shares | Amount | Reserves | Deficit | Interest | Total | |
Balance at December 31, 2022 | 173,589,302 | $53,357,119 | $9,434,516 | $(52,493,801) | $(1,590,974) | $8,706,860 |
Share-based payments | - | - | 569,467 | - | - | 569,467 |
Shares issued upon debt conversion | 18,781,768 | 2,216,611 | - | - | - | 2,216,611 |
Stock option exercised | 2,883,334 | 507,010 | (112,009) | - | - | 395,001 |
Net loss for the year | - | - | - | (5,395,135) | (981,079) | (6,376,214) |
Balance at December 31, 2023 | 195,254,405 | $56,080,740 | $9,891,974 | $(57,888,936) | $(2,572,053) | $5,511,725 |
Share-based payments | - | - | 123,168 | - | - | 123,168 |
Shares issued upon debt conversion | 3,000,000 | 144,030 | 5,971 | - | - | 150,000 |
Stock option exercised | 2,000,000 | 164,858 | (64,858) | 100,000 | ||
Equity raises issuing costs | - | (84,524) | - | - | - | (84,524) |
Rights offering | 195,254,404 | 2,966,316 | - | - | - | 2,966,316 |
Share consolidation rounding | 45 | - | - | - | - | - |
Net loss for the year | - | - | - | (4,563,041) | (1,038,745) | (5,061,785) |
Balance at September 30, 2024 | 395,508,853 | $59,271,419 | $9,956,255 | $(62,451,977) | $(3,610,798) | $3,164,899 |
Supplemental disclosure with respect to changes in equity (Note 13)
The accompanying notes are an integral part of these consolidated financial statements.
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REGENX TECH CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||
(Expressed in Canadian dollars) | |||
Nine months | Nine months | ||
ended | ended | ||
September 30, 2024 | September, 2023 | ||
CASH FLOWS FROM OPERATING ACTIVITIES | |||
Net loss for the year before minority interests | $(4,563,040) | $(3,826,122) | |
Items not affecting cash: | |||
Share-based payments | 123,168 | 503,538 | |
Amortization and depreciation | 598,123 | 487,671 | |
Interest on lease payments | 42,815 | 30,078 | |
Amortized Interest | 143,077 | 46,204 | |
(Gain) loss on sale of assets | - | 19,371 | |
Write down of assets | 823,702 | - | |
Changes in non-cash working capital items: | |||
Receivables | (24,007) | 2,202 | |
Prepaids | (110,427) | 65,169 | |
Accounts payable and accrued liabilities | 35,301 | (273,067) | |
(2,931,288) | (3,240,767) | ||
CASH FLOWS FROM INVESTING ACTIVITIES | |||
Restricted cash | (346,295) | - | |
Equipment expenditures | (270,935) | (1,269,047) | |
Investment in minority interest | (97,341) | - | |
(694,003) | (1,269,047) | ||
CASH FLOWS FROM FINANCING ACTIVITIES | |||
Lease payments | (154,449) | (98,078) | |
Debentures issued | 860,011 | 2,953,830 | |
Promissory notes issued | 840,721 | - | |
Promissory note repayment | (744,067) | - | |
CEBA loan repayment | (40,000) | - | |
Debenture converted | (334,890) | - | |
Options exercised | 100,000 | 160,000 | |
Shares issues on conversion of debt | 150,000 | - | |
Rights offering proceeds | 2,966,316 | - | |
Costs of issuing shares | (84,525) | - | |
3,559,118 | 3,015,752 | ||
Change in cash for the year | (66,173) | (1,494,061) | |
Cash, beginning of the year | 304,656 | 1,574,279 | |
Cash, end of the period | $238,483 | $80,218 | |
REGENX TECH CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Expressed in Canadian dollars)
For the Nine months Ended September 30, 2024 and 2023
1. Nature and continuance of operations
Regenx Tech Corp. (the "Company") was incorporated under the laws of the Province of Alberta, Canada. The company changed its name from Mineworx Technologies Inc. effective October 31, 2022. Its shares are listed for trading on the Canadian Stock Exchange where its common shares trade under the symbol "RGX" (previously "MWX"), the Company additionally trades in the United States on the OTCQB venture marketplace under the symbol "RGXTF" (previously "MWXRF") and on the Frankfurt Stock Exchange under the symbol "YRS".
These consolidated 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. The Company has never had any revenue from its principal operations and its accumulated deficit as of September 30, 2024, was $66,062,774. These financial statements do not give effect to any adjustments which would be necessary should the Company be unable to continue as a going concern and thus be required to realize its assets and discharge its liabilities in other than the normal course of business and at amounts different from those reflected in these financial statements. At this time, the Company is reliant on market acceptance of new equity and debt issues in order to sustain operations and complete project development targets.
The consolidated financial statements were authorized for issue by the Board of Directors of the Company on November 26, 2024.
2. Significant accounting policies Basis of presentation
These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board effective as of September 30, 2024.
The consolidated financial statements have been prepared on a historical cost basis, except for financial instruments classified at fair value through profit and loss, which are stated at their fair value. In addition, these consolidated financial statements have been prepared using the accrual basis of accounting except for cash flow information.
A subsidiary is an entity controlled by the Company. Control exists when the Company has the power to directly or indirectly govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, potential voting rights that are currently exercisable or convertible are taken into account in the assessment of whether control exists. Subsidiary is fully consolidated from the date on which control is transferred to the Company. It is deconsolidated from the date on which control ceases.
Investments subject to significant influence utilize the equity method to account for share ownership. Significant influence is determined in accordance with IAS 28. Investments subject to significant influence are recognized at fair value at the time of acquisition and thereafter the company recognizes its proportionate share of income or loss from the subsidiary.
All inter-company balances and transactions, including unrealized income and expenses arising from inter-company transactions, are eliminated on consolidation.
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REGENX TECH CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Expressed in Canadian dollars)
For the Nine months Ended September 30, 2024 and 2023
2. Significant accounting policies (cont'd)
Basis of presentation- (cont'd)
The consolidated financial statements included the accounts of the Company and the following subsidiaries:
Percentage of | Percentage of | ||
ownership as at | ownership as at | ||
Country of | September 30 | December 31 | |
Incorporation | 2024 | 2023 | |
Mineworx Technologies Inc. | Canada | 100% | 100% |
Regenx USA Inc. | USA | 100% | 100% |
MWX Espańa, S.A.U. | Spain | 100% | 100% |
Magnetitas De Cehegin | Spain | 100% | - |
Iron Bull Mining | Canada | 31.8% | 31.8% |
Significant accounting judgments, estimates and assumptions
The preparation of the Company's consolidated financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities and contingent liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting period. Estimates and assumptions are continuously evaluated and are based on management's experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. However, actual outcomes can differ from these estimates.
Significant judgments used in applying accounting policies that have the most significant effect on the amount recognized in the financial statements are as follows:
-
The recoverability of the carrying value of exploration and evaluation assets.
The Company is required to review the carrying value of its evaluation and exploration assets for potential impairment. Impairment is indicated if the carrying value of the Company's exploration and evaluation assets is not recoverable. If impairment is indicated, the amount by which the carrying value of exploration and evaluation assets exceeds the estimated fair value is charged to the statement of loss and comprehensive loss.
Evaluating the recoverability during the exploration and evaluation phase requires judgements in determining whether future economic benefits from future exploitation, sale or otherwise are likely. Evaluation may be more complex where activities have not reached a stage which permits a reasonable assessment of the existence of reserves or resources. Management must make certain estimates and assumptions about future events or circumstances including, but not limited to, the interpretation of geological, geophysical and seismic data, the
Company's financial ability to continue exploration and evaluation activities and the impact of the current and expected future metal process to potential reserves. - The inputs used in the Black Scholes valuation model (volatility; interest rate; expected life and dividend yield) and forfeiture rates in accounting for share-based payment transactions.
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REGENX TECH CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Expressed in Canadian dollars)
For the Nine months Ended September 30, 2024 and 2023
2. Significant accounting policies (cont'd)
Significant accounting judgments, estimates and assumptions- cont'd
Estimating the fair value of granted stock options, warrants issued for finders' fees and the warrant liability required determining the most appropriate valuation model which is dependent on the terms and conditions of the grant. The estimate of share-based compensation also requires determining the most appropriate inputs to the valuation model.
-
Determination that there no material restoration, rehabilitation and environmental exposure exists based on the facts and circumstances.
The Company make the determination of its obligations for future restoration, rehabilitation and enviromental exposure based on factual information, circumstances and documentation provided from mining authorities in the exploration and evaluation asset's mining jurisdiction. Beyond this, if able to, management will attempt to present a reliable estimate of an obligation that is considered necessary. - The allocation of fair value to assets obtained on the acquisition of Mineworx Technologies Inc.
The Company estimated fair value of equipment based on replacement value. For patents, the fair value represented the costs incurred in a applying for the patent. The fair value of the technology was recognized as the residual costs after the other identifiable assets were determined. Its value was compared to the future expected discounted cash flows resulting from the application of the technology. - Asset acquisition
Management has had to apply judgements with respect to whether the acquisition of Mineworx Technologies Inc. is a business combination or an asset acquisition. Management applies a three-element process to determine whether a business or an asset was purchased, considering inputs, processes, and outputs of the subsidiary in order to reach a conclusion.
Management must also make significant judgments or assessments as to how financial assets and liabilities are categorized.
Significant judgments used in applying accounting policies that have the most significant effect on the amounts recognized in the financial statements are as follows:
-
Going concern
The assessment of the Company's ability to execute its strategy by funding future working capital requirements involves judgment. Estimates and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances (Note 1). - The estimated useful lives and residual value of equipment and technology
Equipment and technology are depreciated and amortized over their useful life. Estimated useful lives are determined based on current facts and past management experience and take into consideration the anticipated physical life of the asset, the potential for technology obsolescence and regulations.
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