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

Jamie Beck, President & CEO, commented, “Our 2023 year-round drilling program was the most expansive campaign conducted to date and continued to demonstrate the vast resource potential at Filo. Drilling extended the boundaries of the Aurora Zone and improved our geological interpretation.  Additionally, our large step-out holes provided very promising results that indicate continuous mineralization from the Aurora Zone towards the northern Bonita Zone, with mineralization remaining open at both ends.  A 40,000m year-round drilling campaign is planned in 2024, which will continue to focus on the areas we have targeted to date and also test the boundaries of the deposit with other large step-out and frontier exploration holes. With eleven target zones distributed across an area of 8km north-south and 3km east-west, we plan on testing the potential for Filo to be significantly larger than we currently know.”

2023 Highlights

During 2023, the Company successfully delivered its most extensive drilling campaign to date, completing 37,188m of resource drilling and 1,597 metres of geotechnical drilling. The Company’s interpretation of the high-grade Aurora Zone has improved dramatically and drilling has continued to expand the footprint of the Filo del Sol deposit via numerous small and large step-out holes. Calendar year (and subsequent to) highlights included:

• Assay results announced for holes FSDH097, FSDH098 and FSDH100, which span a total distance of 1.6km, expand the Filo deposit to the west along the entire distance between the holes drilled. FSDH100 is an example of the successful Aurora Zone step-out drilling conducted by the Company, adding over 500m in depth beyond the current resource pit shell and extending the western margin of the deposit by 250m;
• Assay results announced for holes FDSH086, FSDH089 and FSDH095 highlight the precious metals-rich nature of the Filo deposit. All three holes encountered the high-grade silver zone, and hole FSDH086 intersected a new phase of the porphyry, encountering high-grade porphyry-style mineralization with unusually higher gold grades and copper hosted by a chalcopyrite-bornite assemblage. Located at the northwestern edge of the Aurora Zone, the results demonstrate the significant potential that exists at Filo to find new styles of mineralization;
• Assay results announced for holes FSDH093 and FSDH094, which were collared 500m apart, filled critical high-grade gaps in the Company’s interpretation as well as extending Aurora to the northeast. The high-grade porphyry zone at depth in hole FSDH093 is similar to, and over 300m away from, the intersection of hole FSDH086;
• Assay results announced for hole FSDH084 resulted in the second-best hole from a grade-thickness perspective ever drilled at the Filo del Sol Project. The results of hole FSDH084 confirmed the continuity of high-grade mineralization within the Aurora Zone, including the high-grade Breccia 41 Zone;
• Assay results from holes FSDH087, FSDH090 and FSDH091 support the idea of continuous mineralization across the 1.3km distance between the Aurora and Bonita Zones. Additional holes in this area are underway, some of which have been completed with assays pending, which will provide critical information on the continuity of mineralization from Tamberias in the south to Bonita in the north (a distance of over five kilometres);
• Assay results for hole FSDH091 resulted in the first intersection of high-grade mineralization near the Bonita Zone, and the first instance of consistent grades greater than 1% CuEq outside the Aurora Zone. FSDH091 included a high-grade section averaging 1.15% CuEq over 212m. At over 1km north of the Aurora Zone, the results from this hole opened up an entirely new area to explore for high-grade mineralization;
• In June 2023, the Company closed a $130.0 million private placement, raising funds at market prices with limited dilution and with strong support from institutional investors;
• In June 2023, the Company announced a corporate name change to “Filo Corp.” to better align with the Company’s strategic vision.

2023 Drilling and Assay Results

Drilling and assay results disclosed by the Company during and subsequent to the year ended December 31, 2023 are summarized in Appendix 1 to this news release.

Outlook

Drilling continues to be the Company’s primary focus with nine drill rigs operating at site. The planned 2024 drilling program is expected to be the Company’s most ambitious program to date, including 40,000m of drilling planned with a renewed focus on exploration growth with multiple step-out targets from zones of known mineralization.

Drilling will remain a mix of both large and small step-outs in all directions from 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.

Data collected from the current campaign is being 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 is continuing 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 and in accordance with the Company’s health and safety protocols.

Selected Financial Information

Financial Results

For the three months and year ended December 31, 2023, Filo incurred net losses of $32.2 million and $115.1 million, respectively (2022 – $21.0 million and $69.0 million) including operating losses of $40.7 million and $159.1 million, respectively (2022 – $28.6 million and $95.5 million) and net gains of $7.6 million and $38.6 million, respectively, from the use of marketable securities (2022 – $8.4 million and $25.0 million). Exploration and project investigation costs are generally the most significant expenses for the Company and for the three months and year ended December 31, 2023, they accounted for approximately 89% and 90% of the operating losses, respectively (2022 – 90% and 86%). The Company expenses its exploration costs through the consolidated statement of comprehensive loss, except for mineral property option payments and mineral property acquisition costs, which are capitalized.

Liquidity and Capital Resources

As at December 31, 2023, the Company had cash and cash equivalents of $108.1 million and net working capital of $87.0 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 increase in the Company’s cash and cash equivalents and net working capital is due the non-brokered private placement completed in June 2023 which resulted in net proceeds of $129.1 million, plus the net $1.1 million BHP Top-Up and $4.9 million in gross proceeds received by the Company in relation to the exercise of stock options during the year ended December 31, 2023. These cash inflows were offset by funds used in operations and for general corporate purposes, plus amounts used in the acquisition of mineral properties ($1.0 million) and equipment and facilities for the Filo del Sol Project ($5.5 million).

The Company will continue to deploy the majority of its treasury to fund ongoing advancement of the Filo del Sol Project, and to a lesser extent, for working capital and general corporate purposes.

About Filo del Sol

Filo del Sol is a high-sulphidation epithermal copper-gold-silver deposit associated with one or more large porphyry copper-gold systems. Overlapping mineralizing events combined with weathering effects, including supergene enrichment, have created several different styles of mineralization, including structurally controlled and breccia-hosted gold, manto-style high-grade silver (+/- copper) and high-grade supergene enriched copper within a broader envelope of disseminated, stockwork and breccia-hosted sulphide copper and gold mineralization. This complex geological history has created a heterogeneous orebody which is characterized by zones of very high-grade copper +/- gold +/- silver mineralization within a large envelope of more homogeneous, lower-grade mineralization.

Qualified Persons and Technical Information

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

The field programs were carried out under the supervision of the Mr. Carmichael. Samples were cut at Filo’s Batidero camp near the project site by company personnel. Beginning in the 2020/2021 season, whole core was transported to a new core processing facility located near Rodeo, Argentina, and all sampling activities were carried out there. Diamond drill core was sampled in two metre intervals (except where shortened by geological contacts) using a rock saw for sulphide mineralization. Oxide mineralization was cut with a core splitter in order to prevent dissolution of water-soluble copper minerals during the wet sawing process. Core diameter is a mix of PQ, HQ and NQ depending on the depth of the drill hole. Samples were bagged and tagged at camp, and packaged for shipment by truck to Mendoza, Argentina. RC Samples were collected at the drill site by company personnel with initial splitting carried out at a facility near the drill sites and final splitting completed at the Batidero camp.

Samples were delivered to the ALS preparation laboratory in Mendoza where they were crushed and a 500g split was pulverized to 85% passing 200 mesh. The prepared samples were sent to either the ALS assay laboratory in Santiago, Chile or Lima, Peru for copper, gold and silver assays and multi-element ICP and sequential copper analyses. ALS is an accredited laboratory which is independent of the Corporation. Gold assays were by fire assay fusion with AAS finish on a 30 g sample. Copper and silver were assayed by atomic absorption following a four-acid digestion. Samples were also analyzed for 36 elements with ICP-ES up to drillhole FSDH053. Starting in August 2021 with drillhole FSDH054, the multielement analyses were changed to ME-MS61 which offers ultra low detection limits for 48 elements.  A sequential copper leach analysis was completed on each sample with copper greater than 500 ppm (0.05%). Copper and gold standards as well as blanks and duplicates (field, preparation and analysis) were randomly inserted into the sampling sequence for quality control. On average, 9% of the submitted samples are quality control samples. No data quality problems were indicated by the quality assurance/quality control program.

Mineralized zones within the Filo del Sol deposit are typically flat-lying, or bulk porphyry-style zones and drilled widths are interpreted to be very close to true widths.

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).

About Filo Corp.

Filo 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. Filo is a member of the Lundin Group of Companies.