Osisko Development : Q4 2024 FS

Published: 2025-03-28 21:01:04 ET ODV.V

OSISKO DEVELOPMENT CORP.

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Consolidated Financial Statements

For the years ended December 31, 2024 and 2023

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders of Osisko Development Corp.

Opinion on the Financial Statements

We have audited the accompanying consolidated statements of financial position of Osisko Development Corp. and its subsidiaries (the Company) as of December 31, 2024 and 2023, and the related consolidated statements of loss, of comprehensive loss, of cash flows and of changes in equity for the years then ended, including the related notes (collectively referred to as the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and its financial performance and its cash flows for the years then ended in conformity with IFRS Accounting Standards as issued by the International Accounting Standards Board.

Substantial Doubt About the Company's Ability to Continue as a Going Concern

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the working capital position as at December 31, 2024 will not be sufficient to meet the Company's obligations, commitments and forecasted expenditures up to the year ending December 31, 2025 and has stated that these events or conditions indicate that a material uncertainty exists that may cast substantial doubt on the Company's ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits of these consolidated financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

PricewaterhouseCoopers LLP

1250 René-Lévesque Boulevard West, Suite 2500, Montréal, Quebec, Canada H3B 4Y1 T.: +1 514 205 5000, F.: +1 514 876 1502, Fax to mail:[email protected]

"PwC" refers to PricewaterhouseCoopers LLP, an Ontario limited liability partnership.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

Montréal, Canada

March 28, 2025

We have served as the Company's auditor since 2020.

Consolidated Statements of Financial Position As at December 31, 2024 and 2023

(tabular amounts expressed in thousands of Canadian dollars)

856,902

763,880

144,501

57,333

Equity

856,902

763,880

2024

2023

(Note 4)

Notes

Assets

Current assets

Cash and cash equivalents

106,653

43,455

Restricted cash

2,424

Amounts receivable

2,569

3,952

Inventories

8,695

7,203

Other current assets

4,903

5,307

122,820

62,341

Assets classified as held for sale

430

5,369

123,250

67,710

Non-current assets

Investments in associates

12,183

13,034

Other investments

10,333

19,393

Mining interests

506,670

451,695

Property, plant and equipment

87,123

97,285

Exploration and evaluation

86,258

70,135

Other assets

31,085

44,628

Liabilities

Current liabilities

Accounts payable and accrued liabilities

26,294

25,379

Lease liabilities

361

1,049

Current portion of long-term debt and credit facility

40,314

11,821

Deferred consideration and contingent payments

3,597

3,307

Contract liability

109

Environmental rehabilitation provision

5,974

4,204

Warrant liability

4, 19

67,852

11,552

Non-current liabilities

Lease liabilities

461

624

Long-term debt

5,503

5,102

Deferred consideration and contingent payments

8,635

10,545

Contract liability

42,344

31,700

Environmental rehabilitation provision

84,829

72,525

Other non-current liabilities

863

286,273

178,692

Share capital

1,137,362

1,080,049

Warrants

11,859

Contributed surplus

20,228

18,722

Accumulated other comprehensive loss

(503)

(14,529)

Deficit

(598,317)

(510,913)

570,629

585,188

Going concern (Note 1)

APPROVED ON BEHALF OF THE BOARD

(signed) Sean Roosen, Director

(signed) Charles Page, Director

Consolidated Statements of Loss

For the years ended December 31, 2024 and 2023

(tabular amounts expressed in thousands of Canadian dollars, except per share amounts)

2024

Notes

4,560

31,625

(4,777)

(32,292)

(39,760)

(28,560)

(27,314)

(40,070)

(274)

(1,769)

Impairment of assets

10, 11, 17

(5,741)

(138,371)

Operating loss

(73,306)

(209,437)

Finance costs

(17,471)

(13,378)

Share of loss of associates

(868)

(599)

Change in fair value of warrant liability

19,497

4,535

Other (expense) income, net

(13,547)

14,489

Loss before income taxes

(85,695)

(204,390)

Income tax (expense) recovery

(648)

22,517

Net loss

(86,343)

(181,873)

Basic and diluted net loss per share

(0.92)

(2.21)

Weighted average number of shares outstanding - basic and diluted

93,825,395

82,465,447

2023

Revenues Operating expenses

Cost of sales

Other operating costs General and administrative

Exploration and evaluation, net of tax credits

Consolidated Statements of Comprehensive Loss For the years ended December 31, 2024 and 2023

(tabular amounts expressed in thousands of Canadian dollars)

Comprehensive loss

(74,349)

(205,094)

2024

2023

Net loss

(86,343)

(181,873)

Other comprehensive income (loss)

Items that will not be reclassified to the consolidated statements of loss

Changes in fair value of financial assets at fair value through comprehensive income

(loss)

(6,366)

(10,171)

Income tax effect

648

1,010

Share of other comprehensive loss of associates

(797)

Items that may be reclassified to the consolidated statements of loss

Currency translation adjustments

18,509

(14,060)

Other comprehensive income (loss)

11,994

(23,221)

The notes are an integral part of these consolidated financial statements

Consolidated Statements of Cash Flows

For the years ended December 31, 2024 and 2023

(tabular amounts expressed in thousands of Canadian dollars)

2024

2023

(86,343)

(181,873)

3,524

7,856

11,013

11,525

12,728

13,378

868

599

(366)

(19,497)

(4,535)

17,649

(9,855)

648

(22,644)

5,741

171,974

(78)

(34,581)

3,273

(56)

(1,326)

2,857

3,861

(2,190)

(2,933)

(50,229)

(48,540)

(2,075)

4,755

(52,304)

(43,785)

(31,720)

(37,631)

(4,907)

(17,522)

(9,380)

(17,121)

Proceeds on disposals of property, plant and equipment and assets classified as held for sale

4,987

Proceeds on disposals of investments

3,075

4,241

(334)

2,039

(2,424)

(448)

585

4,197

534

533

(35,235)

(66,061)

126,851

51,756

108

140

(4,240)

(3,489)

(608)

(1,226)

66,788

6,644

(43,253)

(5,675)

(177)

(361)

145,469

47,789

57,930

(62,057)

5,268

(432)

63,198

(62,489)

43,455

105,944

106,653

43,455

Notes

Operating activities Net loss Adjustments for:

Share-based compensation Depreciation

Finance costs

Share of loss of associates

23, 24 23, 24

Change in fair value of financial assets and liabilities at fair value through profit and loss 9

Change in fair value of warrant liability 19Unrealized foreign exchange loss (gain)

Deferred income tax expense (recovery) Impairment of assets

Cumulative catch-up adjustment on contract liability 17

Write-down of VAT receivable 13

Proceeds from contract liability 17Other

Environmental rehabilitation obligations paid 18Net cash flows used in operating activities before changes in non-cash working capital items

Changes in non-cash working capital items Net cash flows used in operating activities Investing activities

Additions to mining interests

Additions to property, plant and equipment Additions to exploration and evaluation assets

Cash payment on deferred consideration and contingent payments 16Change in restricted cash

Acquisition of investments in associates 9Change in reclamation deposit

Other

Net cash flows used in investing activities Financing activities

Proceeds from equity financings 20 Other issuance of common shares

Share and warrant issue expense Capital payments on lease liabilities

Long-term debt and credit facility draw down 15

Repayment of long-term debt and credit facility 15Withholding taxes on settlement of restricted units

Net cash flows provided by financing activities

Increase (decrease) in cash and cash equivalents before impact of exchange rate Effects of exchange rate changes on cash and cash equivalents

Increase (decrease) in cash and cash equivalents

Cash and cash equivalents - Beginning of year Cash and cash equivalents - end of year

Osisko Development Corp.

Consolidated Statements of Changes in Equity For the year ended December 31, 2024

(tabular amounts expressed in thousands of Canadian dollars except number of shares)

Notes

outstanding

capital

Warrants

Deficit

Total

Balance - January 1, 2024

84,102,240

1,080,049

11,859

18,722

(14,529)

(510,913)

585,188

Net loss

(86,343)

Other comprehensive income, net

11,994

(74,349)

Transfer of realized loss on financial assets at fair value

through other comprehensive income (loss), net of taxes

2,032

(2,032)

2024 Brokered private placement

31,946,366

41,580

2024 Non-brokered private placement

19,163,410

13,395

Shares issued for the settlement of deferred consideration

1,228,394

3,409

Share issue expense

(2,303)

Share-based compensation:

- Share options

2,325

- Restricted and deferred share units

1,269

Shares issued - employee share purchase plan

93,535

292

(177)

Balance - December 31, 2024

136,580,233

1,137,362

11,859

20,228

(503)

(598,317)

570,629

Number of common shares

Contributed surplus $

Accumulated other comprehensive loss $

Comprehensive income (loss)

11,994

(86,343)

(74,349)

Shares issued from RSU/DSU settlement

46,288

940

(2,088)

971

(177)

As at December 31, 2024, accumulated other comprehensive income (loss) comprises items that will not be recycled to the consolidated statements of income or loss amounting to $20.8 million and items that may be recycled to the consolidated statements of income (loss) amounting to $(21.3) million.

The notes are an integral part of these consolidated financial statements

Osisko Development Corp.

Consolidated Statements of Changes in Equity For the year ended December 31, 2023

(tabular amounts expressed in thousands of Canadian dollars, except number of shares)

Number of common shares

Notes outstanding Balance - January 1, 2023

75,629,849

Share capital $ 1,032,786

Warrants $ 1,573

Contributed surplus $ 12,857

Accumulated other comprehensive loss $ 7,166

Deficit $

Total $

(323,948)730,434

Comprehensive loss

(23,221)

(181,873)

(205,094)

(181,873) (23,221) (205,094)

Net loss

Other comprehensive loss, net Transfer of realized loss on financial assets at fair value through other comprehensive loss, net of taxes

Bought deal financing

Shares issued for the settlement of deferred consideration Shares issued to Williams Lake First Nation

Share issue expense

Change in fair value related to warrants modification Share-based compensation:

- Share options

- Restricted and deferred share units

Shares issued - employee share purchase plan Shares issued from RSU/DSU settlement Balance - December 31, 2023

207,841,850

16 2020 20

45,5456,211

-(23,221)

(181,873)

- -

1,526 -

(1,526)

-51,756

454,026 60,000- --- 67,64048,875 84,102,240

2,986 - - - - 2,986 292----292

(2,988)

(408)

-4,483

- -

-(4,483)

(3,396)

4,175

-4,175

4,023 - - 4,023

354---354

1,074 1,080,049

- 11,859

(2,333) 18,722

- (14,529)

917 (342)

(510,913)

As at December 31, 2023, accumulated other comprehensive income (loss) comprises items that will not be recycled to the consolidated statements of income or loss amounting to $2.3 million and items that may be recycled to the consolidated statements of income (loss) amounting to $(16.8) million.

The notes are an integral part of these consolidated financial statements

Notes to the Consolidated Financial Statements For the years ended December 31, 2024 and 2023

(tabular amounts expressed in thousands of Canadian dollars, except number of shares and per share amounts)

1. Nature of operations and going concern

Osisko Development Corp. ("Osisko Development" or the "Company") is a mineral exploration and development company focused on the acquisition, exploration and development of precious metals resource properties in continental North America. Osisko Development is focused on exploring and developing its mining assets, including the Cariboo Gold Project in British Columbia, the San Antonio Gold Project in Mexico and the Trixie Test Mine in the USA.

The Company's registered and business address is 1100, avenue des Canadiens-de-Montréal, suite 300, Montreal, Québec and is constituted under the Canada Business Corporations Act. The common shares of Osisko Development trade under the symbol ODV on the TSX Venture Exchange ("TSX-V") and on the New York Stock Exchange ("NYSE"). As at December 31, 2024, the Company's significant shareholder, Osisko Gold Royalties ("OGR") held an interest of 24.4% in Osisko Development (compared to 39.0% as at December 31, 2023).

These consolidated financial statements have been prepared on the basis of accounting principles applicable to a going concern, which contemplates the realization of assets and settlement of liabilities in the normal course of business as they come due. In assessing whether the going concern assumption is appropriate, management takes into account all available information about the future, which is at least, but not limited to twelve months from the end of the reporting year. As at December 31, 2024, the Company has a negative working capital of $21.3 million, which includes a cash and cash equivalent balance of $106.7 million. The Company also has an accumulated deficit of $598.3 million and incurred a net loss of $86.3 million for the year ended December 31, 2024.

The working capital position as at December 31, 2024 will not be sufficient to meet the Company's obligations, commitments and forecasted expenditures up to the year ending December 31, 2025. Management is aware, in making its assessment, of material uncertainties related to events and conditions that may cast a substantial doubt upon the Company's ability to continue as a going concern as described in the preceding paragraph, and accordingly, the appropriateness of the use of accounting principles applicable to a going concern. These consolidated financial statements do not reflect the adjustments to the carrying values of assets and liabilities, expenses and financial position classifications that would be necessary if the going concern assumption was not appropriate. These adjustments could be material.

The Company's ability to continue future operations and fund its planned activities is dependent on management's ability to secure additional financing in the future, which may be completed in several ways including, but not limited to, a combination of selling assets and investments from its portfolio, project debt finance, offtake or royalty financing and other capital market alternatives. Failure to secure future financings may impact and/or curtail the planned activities for the Company, which may include, but are not limited to, the suspension of certain development activities and the disposal of certain assets and investments to generate liquidity. While management has been successful in securing financing in the past and as disclosed in Note 20, there can be no assurance that it will be able to do so in the future or that these sources of funding or initiatives will be available to the Company or that they will be available on terms which are acceptable to the Company. If Management is unable to obtain new funding, the Company may be unable to continue its operations, and amounts realized for assets might be less than the amounts reflected in these consolidated financial statements.

2. Basis of presentation and Statement of compliance

The accompanying consolidated financial statements have been prepared in accordance with the IFRS Accounting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"). The accounting policies, methods of computation and presentation applied in the preparation of these consolidated financial statements are consistent with those of the previous financial year, except for the application of the Amendments to IAS 1 as described in Note 4. The comparative figures as at December 31, 2023 were adjusted accordingly.

The Board of Directors approved these consolidated financial statements for issue on March 28, 2025.

3. Material Accounting Policies

The material accounting policies applied in the preparation of the consolidated financial statements are described below.

Disclaimer

Osisko Development Corp. published this content on March 29, 2025, and is solely responsible for the information contained herein. Distributed via , unedited and unaltered, on March 29, 2025 at 01:00 UTC.