Filo Mining Corp. (TSX: FIL) (Nasdaq First North Growth Market: FIL) (OTCQX: FLMMF) announces its results for the three months ended March 31, 2023.

Jamie Beck, President & CEO, commented, “With our continued success at expanding and defining our resource potential, we have commenced 2023 with our most aggressive drilling campaign to date. There are nine rigs currently available at the Project and we have exceeded expectations so far in 2023 on metres drilled. Our winterization efforts are now underway as the summer drilling season comes to a close, with the expectation of continuing the program with only minor interruptions for rig maintenance and re-mobilization. Our Q1 2023 drilling results were comprised of a mix of both large and small step-outs to the north and south of our current interpretation of the Aurora Zone, and we will focus more exclusively on the Aurora and Bonita Zones as winter conditions arrive on site. Our exploration results demonstrate the potential of the Project as one of the most significant copper-gold-silver discoveries of its generation.”

Q1 2023 HIGHLIGHTS

• Continued exploration success, highlighted by:
  • Multiple holes drilled into the Aurora Zone across large intervals with consistently strong mineralization. Several of the holes reported are entirely outside the Company’s existing resource pit shell and serve to improve the geological interpretation of the deposit;
  • Drilled the most northerly hole in the Aurora Zone, extending it 160m northeast, leaving it wide open towards the Bonita Zone which sits a further 1.5km to the northeast;
  • Hole 68A setting a new record at Filo del Sol for the longest interval to date at almost 1.8 km in length;
  • Established a new mineralized zone at the Flamenco exploration target with the first hole drilled in an area that sits over 3 kilometers to the south of the Aurora Zone;
• The Aurora Zone, the Bonita Zone, and the high-grade Breccia 41 area remain open to expansion in several directions and drilling to further define them is ongoing;
• On March 19, 2023, the Company announced that it had been added to the ETFMG Prime Junior Silver Miners ETF (“SILJ”) pursuant to the SILJ’s quarterly rebalancing, effective market close on March 17, 2023; and
• On March 13, 2023, the Company announced the appointment of Ms. Joyce Ngo and Mr. Peter J. O’Callaghan to its Board of Directors. Concurrently, Mr. Alessandro Bitelli retired and stepped off the Board of Directors. The changes resulted in the Company’s Board of Directors having a total of nine members.

Q1 2023 DRILLING AND ASSAY RESULTS

During and subsequent to the end of the first quarter of 2023, the Company announced the following results from the ongoing drill program:

• FSDH070A an infill hole in the Aurora Zone intersected 1,056.5m at 0.86% CuEq from a depth of 282m, including 670.4m at 0.97% CuEq from 369.7m. The hole ended in strong mineralization at a depth of 1,338.5m due to rig capacity;
• FSDH071 an infill hole in the Aurora Zone intersected 1,028.0m at 1.16% CuEq from a depth of 292m, including 172.0m at 2.14% CuEq from 408.0m and 237.5m at 1.49% CuEq from 776.0m. The hole ended in mineralization at a depth of 1,320m due to rig capacity. The entire hole is outside of the resource pit shell;
• FSDH068A intersected 1,776.0m at 0.70% CuEq from a depth of 18.0m, including 1,120.0m at 0.92% CuEq from 394.0m and 724.2m at 1.08% CuEq from 574.0m. The hole is entirely outside of the resource pit shell;
• FSDH069A intersected 1,296.5m at 1.00% CuEq from a depth of 138.0m, including 31m at 127.0 g/t Ag from 404.0m in the Silver Zone, 598.0m at 1.51% CuEq from 498.0m and 94.0m at 3.01% CuEq from 792.0m. The hole ended in strong mineralization at a depth of 1,434.5m due to rig capacity. The hole is entirely outside of the resource pit shell;
• FSDH074 intersected 1,022.0m at 0.66% CuEq from a depth of 278.0m, including 516.0m at 0.79% CuEq from 644.0m and 252.0m at 0.85% CuEq from 840.0m. The hole was collared on Section 9200N, 200m east of FSDH068A and 400m east of FSDH041. The hole was stopped in porphyry mineralization at 1,509.0m. The hole is entirely outside of the resource pit shell;
• FSDH077 intersected 2.0m at 10.35 g/t Au from a depth of 192.0m plus 516.2m at 0.20% CuEq from 404.0m. The hole was collared on Section 6000N and is the first hole in the new Flamenco target. The hole was stopped at 920.2m; and
• FSDH073 intersected 983.9m at 0.89% CuEq from a depth of 404.5m, including 614.0m at 1.06% CuEq from 600.0m and 272.0m at 1.33% CuEq from 756.0m.

Assay results received by the Company during and subsequent to the first quarter of 2023 are summarized in Appendix 1 to this news release.

OUTLOOK

Drilling continues to be the primary focus with nine drill rigs at site. Drilling will remain a mix of both large and small step-outs to the north and south of the Aurora Zone, as well as resource definition drilling within it. The Company continues to maintain a strong focus on improving drill productivity through a variety of initiatives and is planning to continue drilling and field operations throughout the South American winter.

Data collected from the current campaign will be used to develop a comprehensive geological model which will guide further exploration and form the basis of an eventual update to the Mineral Resource estimate. The Company will continue preliminary metallurgical testwork on the sulphide mineralization, as well as environmental and social baseline programs in support of future project permitting.

The Company’s plans and timelines are subject to equipment and staff availability, along with being able to operate safely and effectively throughout the winter and in accordance with the Company’s health and safety protocols.

SELECTED FINANCIAL INFORMATION

(In thousands of Canadian dollars)

The financial information in this table were selected from the Financial Statements, which are available on SEDAR at www.sedar.com and the Company’s website www.filo-mining.com.

FINANCIAL RESULTS

During the three months ended March 31, 2023, the Company incurred a net loss of $29.9 million. The net loss is driven primarily by $34.3 million in exploration and project investigation expense and $4.9 million in G&A expense. These expenses were partially offset by a gain of $8.4 million resulting from the use of marketable securities for the purposes of facilitating intragroup funding transfers (“Funding Gain”). For the three months ended March 31, 2022, the Company reported a net loss of $14.4 million consisting mainly of $14.9 million in exploration and project investigation expense and $2.1 million in G&A expense. These expenses were partially offset by a Funding Gain of $2.0 million.

LIQUIDITY AND CAPITAL RESOURCES

As at March 31, 2023, the Company had cash and cash equivalents of $58.7 million and net working capital of $35.8 million, compared to cash and cash equivalents of $74.9 million and net working capital of $60.3 million as at December 31, 2022. The decrease in the Company’s cash and cash equivalents and net working capital is due primarily to funds used in operations and for general corporate purposes, plus amounts used in the acquisition of equipment and facilities for the Filo del Sol Project, offset by a net $1.1 million BHP Top-Up and $1.4 million in gross proceeds received by the Company in relation to the exercise of stock options during the three months ended March 31, 2023. The Company plans to deploy its treasury to fund ongoing exploration and advancement of the Filo del Sol project, and for working capital and general corporate purposes.

About Filo Mining

Filo Mining is a Canadian exploration and development company focused on advancing its 100% owned Filo del Sol copper-gold-silver deposit located in San Juan Province, Argentina and adjacent Region III, Chile.  The Company’s shares are listed on the TSX, Nasdaq First North Growth Market, and on the OTCQX. Filo Mining is a member of the Lundin Group of Companies.

Technical Information

Copper Equivalent is calculated based on US$ 3.00/lb Cu, US$ 1,500/oz Au and US$ 18/oz Ag, with 80% metallurgical recoveries assumed for all metals.  The formula is: CuEq % = Cu % + (0.7292 * Au g/t) + (0.0088 * Ag g/t).

Details on assay procedures and the drill intersections provided above can be found in the Company’s news releases dated January 10, 2023, February 2, 2023, March 16, 2023 and April 13, 2023.

Qualified Persons

The scientific and technical disclosure for the Filo del Sol Project included in this news release have been reviewed and approved by Bob Carmichael, P.Eng. and Jamie Beck, P. Eng.  Mr. Carmichael is Filo Mining’s Vice President of Exploration and a Qualified Person under National Instrument 43-101 Standards of Disclosure of Mineral Projects (“NI 43-101”). Mr. Beck is Filo Mining’s President and CEO and is also a Qualified Person under NI 43-101.

APPENDIX 1 – Q1 2023 ASSAY RESULTS

Assay results received by the Company during and subsequent to the first quarter of 2023 are summarized in the following table:

As of the date of this News Release, additional holes have been completed with assays pending, which include:

• FSDH075 drilled to a final depth of 1,649m – Bonita Zone;
• FSDH076 drilled to a final depth of 1,543m – Aurora Zone infill;
• FSDH079 drilled to a final depth of 846m – Gemelos Target; and
• FSDH081 drilled to a final depth of 683m – Flamenco Target.

Assay results for these holes will be released as they are received, analyzed and confirmed by the Company.