HCH.V · 2024-12-31 12:00:00

Half-Yearly Report: Hot Chili Limited and Controlled Entities Interim

Financials

Financial Report for the Half-Year Ended 31 December 2024

PERTH, Australia

March 14, 2025

/CNW/ -

Review of Operations

Highlights

Hot Chili adds former La Verde Copper Mine (La Verde) to its Costa Fuego coastal copper hub and confirms significant Cu-Au porphyry discovery.

Costa Fuego Cu-Au Pre-feasibility Study (PFS): Final Stages Underway.

Huasco Water – Water Supply PFS: Nearing Completion.

31 December 2024

cash position

A$19 million

Hot Chili Confirms Major Cu-Au Porphyry Discovery at La Verde

11 February 2025

, the Company announced new drill results from ten Reverse Circulation (RC) drill holes, confirming La Verde as a significant copper-gold

porphyry discovery in low elevation coastal

Chile

, with broad, consistently mineralised intersections extending over

300 m

vertically, commencing at shallow

depths.

Drilling confirms scale & growth potential*

Wide, shallow mineralisation

– current discovery footprint extends

550 m

400 m

and remains open in all directions.

Deeper potential remains untapped

– Mineralisation commences from shallow depths, extends to more than

300m

below surface, and 8 of 12 drill holes

reported to date end in mineralisation at the limit of RC drilling depth capability.

Gravel cover masking potentially much larger porphyry system

– step-out drilling underway.

Potential below the historical oxide copper open pit untested

– drill testing yet to commence.

Major discovery in its infancy

– every drill hole has intersected porphyry-style, copper-gold mineralisation (refer to Table 1 for details on significant

intercepts).

As at

11 February 2025

, Hot Chili had completed 19 RC drill holes (

5,700 m

) at La Verde, with assay results from 12 holes reported so far confirming a major

copper-gold porphyry discovery* in

Chile's

coastal range, with assays pending for seven additional RC holes, with geological logging confirming the presence of

porphyry host-rock featuring porphyry-style A- and B-type veining in each of the pending drill holes.

Diamond drilling being planned, targeting potential for deeper, higher-grade zones intersected at depth and to test potential for +1km vertical depth extent, typical

of other recent major porphyry discoveries, such as Hot Chili's neighbouring Cortadera discovery, *La Verde Mineral Exploration/Exploration Target Area:

Exploration targets and/or Exploration zones and/or Exploration areas are speculative and there is no certainy that any future work or evaluation will lead to the

definition of a mineral resource.

Adjacent Properties: The Company has no interest in, or rights to, any of the adjacent properties mentioned, and exploration results on adjacent properties are not necessarily indicative of mineralization on the Company's properties. Any references to exploration results or mineral

occurrences on adjacent properties are provided for information only and do not imply any certainty of achieving similar results on the Company's properties.

Table 1. Significant Drilling Intersections from La Verde (CNW Group/Hot Chili Limited)

Notes to Table 1: Significant intercepts for La Verde are calculated above a nominal cut-off grade of 0.2% Cu. Where appropriate, significant intersections may contain up to 30m down-hole distance of internal dilution (less than 0.2% Cu). Significant intersections are separated where

internal dilution is greater than 30m down-hole distance. The selection of 0.2% Cu for significant intersection cut-off grade is aligned with marginal economic cut-off grade for bulk tonnage polymetallic copper deposits of similar grade in Chile and elsewhere in the world.

Previously released significant intercepts. See announcement dated 18

December 2024

Hot Chili adds La Verde to its Costa Fuego Coastal Copper Hub

November 2024

, Hot Chili executed an Option Agreement to acquire a 100% interest in the historical La Verde Copper Mine (La Verde), located 30 km south of

the Company's low-altitude, Costa Fuego copper-gold project in

Chile

(Figure 1).

La Verde encompasses

800m

strike length of open pit workings, previously exploited by private interests for shallow copper-oxide mineralisation.

The La Verde Option Agreement, along with the recently executed Domeyko Option Agreement (see announcement dated 30

April 2024

), for the first time

consolidates and provides access to, a much larger potential porphyry copper deposit footprint measuring approximately 1.4km by 1.2km, based on geophysical

surveys.

The material terms of the executed La Verde Option Agreement are as follows:

Hot Chili's 100% owned subsidiary Sociedad Minera La Frontera SpA ("Frontera") has executed a definitive option agreement with SLM Los Dominiceros una de

la Sierra Los Chiqueros ("SLM Dominoceros"), the holder of a 100% interest in the concession comprising La Verde, for the grant to Frontera of an option to

acquire a 100% interest in the La Verde concession ("La Verde Option Agreement").

Non-refundable cash payment of

US$320,000

to SLM Dominoceros upon grant of the La Verde Option Agreement.

Non-refundable cash payment of

US$680,000

within 12 months from the grant of the La Verde Option Agreement.

Non-refundable cash payment of

US$1,000,000

within 24 months from the grant of the La Verde Option Agreement.

Option may be exercised within 36 months of the date of grant of the La Verde Option for a final non-refundable cash payment of

US$6,890,000

Figure 1. Location of La Verde in relation to Costa Fuego, coastal range Chile (CNW Group/Hot Chili Limited)

Costa Fuego Cu-Au Pre-feasibility Study (PFS): Final Stages Underway

During the period, Hot Chili completed key workstreams for Costa Fuego's PFS and Environmental Impact Assessment (EIA), achieving milestones in metallurgy,

mining, infrastructure, and environmental planning.

Metallurgy

Finalized metallurgical testwork using Nova Mineralis Novaminore® technology, which leverages saline water and regulated irrigation cycles for enhanced

chalcopyrite recovery from heap leaching of low grade mineralisation.

Demonstrated reduced freshwater dependency, aligning with Costa Fuego's planned seawater processing.

Results informed predictive models for copper recovery and acid consumption, optimizing the mine schedule.

Mining

Mine scheduling finalised using advanced software, incorporating feed from four open pits (Productora, Cortadera,

Alice

, and

San Antonio

) and an

underground block cave at Cortadera.

Multiple schedule iterations prioritized lower pre-start capital, faster payback, and optimized production rates.

Initial capital and operating cost estimates were completed, with further optimization underway for inclusion in the PFS financial model.

Infrastructure

Finalized site layout, including placement of heap/dump leach pads, waste dumps, stockpiles, mill site, tailings storage, and support buildings.

Integrated surface water management systems, including diversion channels and dewatering infrastructure.

Ongoing road optimization to align with the mining schedule.

Environment

Advanced EIA preparation with additional hydrogeological and geotechnical investigations planned for 2025.

Completed collection of 122 rock samples for acid rock drainage (ARD) and metal leaching (ML) tests to inform long-term infrastructure and mine closure

planning.

Conducted baseline environmental studies and integrated results into design decisions.

Huasco Water – Water Supply PFS: Nearing Completion

During the quarter, Hot Chili's 80% owned subsidiary company Huasco Water continued to progress its PFS-level, water supply Business Case Study. Key

deliverables finalised this quarter by international engineering firm ILF Group, include:

Evaluation of marine works and the conveyance system to Costa Fuego and other potential third-party off-takers

Completion of trade-off studies, including desalination plant (technology, location, and sizing), and pipeline configuration (routing and location of pumping

stations) for potential third party off-takers. Note that Costa Fuego does not require desalinated water for processing.

Optimisation of capital cost estimates for the initial stage of seawater supply to Costa Fuego

Options for third party water supply, including desalinated water, continue to advance

Huasco Water controls the only active granted maritime water concession and most of the necessary permits to provide non-continental water supply to the

Huasco Valley, following over a decade of permitting advancement for Hot Chili's coastal range Costa Fuego copper-gold project.

Uniquely, Huasco Water represents an opportunity for Hot Chili to potentially outsource its water infrastructure capital requirements in addition to providing

significant additional funding optionality for Costa Fuego.

Hot Chili is continuing its discussions with potential water off-takers in the Huasco Valley and is also engaging with major water infrastructure groups in relation to

potential partnership opportunities for financing and development of Huasco Water's future industrial water infrastructure.

Qualifying Statements

The Mineral Resource summary for the Costa Fuego Project is presented in Table 2.

Table 2: Costa Fuego Copper-Gold Project Mineral Resource Estimate, 26 Feb 2024 (CNW Group/Hot Chili Limited)

Mineral Resources are reported on a 100% Basis - combining Mineral Resource estimates for the Cortadera, Productora, Alice and San Antonio deposits. All figures are rounded, reported to appropriate significant figures and reported in accordance with the Joint Ore Reserves

Committee Code (2012) and NI 43-101. Mineral Resource estimation practices are in accordance with CIM Estimation of Mineral Resource and Mineral Reserve Best Practice Guidelines (November 29, 2019) and CIM Environmental, Social and Governance Guidelines for Mineral

Resources and Mineral Reserve Estimation (September 8, 2023) and reported in accordance CIM Definition Standards for Mineral Resources and Mineral Reserves (May 10, 2014) that are incorporated by reference into NI 43-101.

The Productora deposit is 100% owned by Chilean incorporated company Sociedad Minera El Aguila SpA (SMEA). SMEA is a joint venture (JV) company – 80% owned by Sociedad Minera El Corazón Limitada (a 100% subsidiary of Hot Chili Limited), and 20% owned by Compañía

Minera del Pacífico S.A (CMP).

The Cortadera deposit is controlled by a Chilean incorporated company Sociedad Minera La Frontera SpA (Frontera). Frontera is a subsidiary company – 100% owned by Sociedad Minera El Corazón Limitada, which is a 100% subsidiary of Hot Chili Limited.

The San Antonio deposit is controlled through Frontera (100% owned by Sociedad Minera El Corazón Limitada, which is a 100% subsidiary of Hot Chili Limited) and Frontera has an Option Agreement to earn a 100% interest.

The Mineral Resource Estimates in the tables above form coherent bodies of mineralisation that are considered amenable to a combination of open pit and underground extraction methods based on the following parameters: Base Case Metal Prices: Copper US$ 3.00/lb, Gold US$

1,700/oz, Molybdenum US$ 14/lb, and Silver US$20/oz.

All Mineral Resource Estimates were assessed for Reasonable Prospects of Eventual Economic Extraction (RPEEE) using both Open Pit and Block Cave Extraction mining methods at Cortadera and Open Pit mining methods at Productora, Alice and San Antonio.

Metallurgical recovery averages for each deposit consider Indicated + Inferred material and are weighted to combine sulphide flotation and oxide leaching performance. Process recoveries:

Cortadera – Weighted recoveries of 82% Cu, 55% Au, 81% Mo and 36% Ag. CuEq(%) = Cu(%) + 0.55 x Au(g/t) + 0.00046 x Mo(ppm) + 0.0043 x Ag(g/t)

San Antonio - Weighted recoveries of 85% Cu, 66% Au, 80% Mo and 63% Ag. CuEq(%) = Cu(%) + 0.64 x Au(g/t) + 0.00044 x Mo(ppm) + 0.0072 x Ag(g/t)

Alice - Weighted recoveries of 81% Cu, 47% Au, 52% Mo and 37% Ag. CuEq(%) = Cu(%) + 0.48 x Au(g/t) + 0.00030 x Mo(ppm) + 0.0044 x Ag(g/t)

Productora – Weighted recoveries of 84% Cu, 47% Au, 48% Mo and 18% Ag. CuEq(%) = Cu(%) + 0.46 x Au(g/t) + 0.00026 x Mo(ppm) + 0.0021 x Ag(g/t)

Costa Fuego – Recoveries of 83% Cu, 53% Au, 71% Mo and 26% Ag. CuEq(%) = Cu(%) + 0.53 x Au(g/t) + 0.00040 x Mo(ppm) + 0.0030 x Ag(g/t)

Copper Equivalent (CuEq) grades are calculated based on the formula: CuEq% = ((Cu% × Cu price 1% per tonne × Cu_recovery) + (Mo ppm × Mo price per g/t × Mo_recovery) + (Au ppm × Au price per g/t × Au_recovery) + (Ag ppm × Ag price per g/t × Ag_recovery)) / (Cu price 1%

per tonne × Cu recovery). The base case cut-off grade for Mineral Resources considered amenable to open pit extraction methods at the Cortadera, Productora, Alice and San Antonio deposits is 0.20% CuEq, while the cut-off grade for Mineral Resources considered amenable to

underground extraction methods at the Cortadera deposit is 0.27% CuEq.

Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. These Mineral Resource estimates include Inferred Mineral Resources that are considered too speculative geologically to have economic considerations applied to them that would

enable them to be categorised as Mineral Reserves. It is reasonably expected that the majority of Inferred mineral resources could be upgraded to Measured or Indicated Mineral Resources with continued exploration.

The effective date of the estimate of Mineral Resources for the period ending June 30 2024 is February 23rd, 2024. Refer to ASX Announcement "Hot Chili Indicated Resource at Costa Fuego Copper-Gold Project Increases to 798 Mt " for JORC Table 1 information in this statement

related to the Costa Fuego Mineral Resource Estimate (MRE) by Competent Person Elizabeth Haren, who is also a qualified person (within the meaning of NI 43-101) constituting the MREs of Cortadera, Productora, Alice and San Antonio (which combine to form Costa Fuego). Hot

Chili confirms it is not aware of any new information or data that materially affects the information included in the Resource Announcement and all material assumptions and technical parameters stated for the Mineral Resource Estimates in the Resource Announcement continue to

apply and have not materially changed.

Hot Chili Limited is not aware of political, environmental or other risks that could materially affect the potential development of the Mineral Resources.

The references to mineral resource estimates in this Half-yearly Report have been extracted from the estimate of mineral resources contained in the Company's

announcement to ASX dated

26 February 2024

"Hot Chili Indicated Resource at Costa Fuego Copper-Gold Project Increases to 798 Mt", a copy of which is

available on the Company's website at www.hotchili. net.au/investors/asx-announcements/. The Company confirms that it is not aware of any new information or

data that materially affects the information included in this report about the Company's mineral resources and that all material assumptions and technical

parameters underpinning the mineral resource estimates continue to apply and have not materially changed.

The references to exploration results in this Annual Report have been extracted from the Company's announcements to ASX dated

3 August 2023

, "Hot Chili

Commences

30,000m

Drill Programme at Costa Fuego Copper-Gold Project",

28 August 2023

, "Hot Chili Signs Binding Letter of Intent for Option to Acquire

Cometa Project in

Chile

15 November 2023

"Hot Chili Continues to Expand its Costa Fuego Coastal Copper Hub in

Chile

23 January 2024

, "Hot Chili

Commences Next Phase of Resource Expansion Drilling Programme at Costa Fuego" and

30 April 2024

"Hot Chili Secures Large Addition to its Costa Fuego

Coastal Copper Hub in

Chile

", copies of which are available on the Company's website at

www.hotchili.net.au/investors/asx-announcements/

. The Company

confirms that it is not aware of any new information or data that materially affects the information included in this report about the Company's exploration results.

Qualified Persons – NI 43-101

The information pertaining to the Mineral Resource Estimates included in this Report has been reviewed and approved by Ms.

Elizabeth Haren

(FAUSIMM (CP) &

MAIG) of Haren Consulting Pty Ltd. All other scientific and technical information in this Report has been reviewed and approved by Mr

Christian Easterday

, MAIG,

Hot Chili's Managing Director and Chief Executive Officer. Each of Ms. Haren and Mr. Easterday are a qualified person within the meaning of NI 43-101.

Competent Person's Statement - JORC

The information in this Report that relates to Mineral Resources for Cortadera, Productora (including

Alice

) and

San Antonio

which constitute the combined Costa

Fuego Project is based on information compiled by Ms

Elizabeth Haren

, a Competent Person who is a Fellow and Chartered Professional of The Australasian

Institute of Mining and Metallurgy and a Member of the Australian Institute of Geoscientists. Ms Haren is a full-time employee of Haren Consulting Pty Ltd and an

independent consultant to Hot Chili. Ms Haren has sufficient experience, which is relevant to the style of mineralisation and types of deposits under consideration

and to the activities undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code of Reporting of Exploration Results,

Mineral Resources and Ore Reserves'. Ms Haren consents to the inclusion in the Report of the matters based on her information in the form and context in which

it appears.

The information in this announcement that relates to Exploration Results for the Cortadera projects is based upon information compiled by Mr

Christian Easterday

the Managing Director and a full-time employee of Hot Chili Limited, whom is a Member of the Australasian Institute of Geoscientists (AIG). Mr Easterday has

sufficient experience that is relevant to the style of mineralisation and type of deposits under consideration and to the activity which he is undertaking to qualify as

a 'Competent Person' as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves' (JORC

Code). Mr Easterday consents to the inclusion in the report of the matters based on their information in the form and context in which it appears.

Production targets and forecast financial information contained in PEA

The information in this report relating to any production targets and forecast financial information derived from the production targets comprised in the statements

in this report about the PEA for the Costa Fuego Copper-Gold Project was previously reported in the Company's announcement 'Hot Chili Announces PEA for

Costa Fuego' (the "Technical Report") released to ASX on

28 June 2023

and is available to view on the Company's website at

www.hotchili.net.au/investors/asx-announcements/

For readers to fully understand the information in this Half Year Report, they should read the Technical Report (available on

www.SEDAR.com

or at

www.hotchili.net.au

) in its entirety, including all qualifications, assumptions and exclusions that relate to the information set out in this Half Year Report that

qualifies the technical information contained in the Technical Report. The Technical Report is intended to be read as a whole, and sections should not be read or

relied upon out of context. The technical information in this Half Year Report is subject to the assumptions and qualifications contained in the Report.

The Company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement, and

that all material assumptions and technical parameters underpinning the production targets and forecast financial information derived from the production targets

contained in the original market announcement continue to apply and have not materially changed.

Disclaimer

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts

responsibility for the adequacy or accuracy of this Report.

Cautionary Note for U.S. Investors Concerning Mineral Resources

NI 43-101 is a rule of the Canadian Securities Administrators which establishes standards for all public disclosure an issuer makes of scientific and technical

information concerning mineral projects. Technical disclosure contained in this report has been prepared in accordance with NI 43-101 and the Canadian Institute

of Mining, Metallurgy and Petroleum Classification System. These standards differ from the requirements of the U.S. Securities and Exchange Commission

("SEC") and resource information contained in this report may not be comparable to similar information disclosed by domestic

United States

companies subject to

the SEC's reporting and disclosure requirements.

All amounts in this report are in U.S. dollars unless otherwise noted.

Forward Looking Statements

This report contains certain statements that are "forward-looking information" within the meaning of Canadian securities legislation and Australian securities

legislation (each, a "forward-looking statement"). Forward-looking statements reflect the Company's current expectations, forecasts, and projections with respect

to future events, many of which are beyond the Company's control, and are based on certain assumptions. No assurance can be given that these expectations,

forecasts, or projections will prove to be correct, and such forward-looking statements included in this report should not be unduly relied upon. Forward-looking

information is by its nature prospective and requires the Company to make certain assumptions and is subject to inherent risks and uncertainties. All statements

other than statements of historical fact are forward-looking statements. The use of any of the words "believe", "could", "estimate", "expect", "may", "plan",

"potential", "project", "should", "toward", "will", "would" and similar expressions are intended to identify forward-looking statements.

The forward-looking statements within this Report are based on information currently available and what management believes are reasonable assumptions.

Forward-looking statements speak only as of the date of this report. In addition, this report may contain forward-looking statements attributed to third-party

industry sources, the accuracy of which has not been verified by the Company.

In this Report, forward-looking statements relate, among other things, to: projections for and success of the Company and its projects; the ability of the Company

to expand mineral resources beyond current mineral resource estimates; the results of current and planned geophysical, soil sampling and other exploration

programs, including MIMDAS and Mag; the results and impacts of current and planned drilling to extend mineral resources and identify new deposits; the

Company's ability to convert mineral resources to mineral reserves; the timing and outcomes of current and future planned economic studies including the planned

PFS and DFS; the potential to develop a water business in the Huasco valley and the future economics thereof; the timing and results of the Water Supply

Business Case Study; whether or not a second maritime water extraction permit will be granted; whether or not water offtake agreements and/or infrastructure

partner agreements will be entered into and, if so, on what terms; the timing and outcomes of regulatory processes required to obtain permits for the development

and operation of the Costa Fuego Project, including the EIA; whether or not the Company will make a development decision and the timing thereof; and estimates

of planned exploration costs and the results thereof.

Forward-looking statements involve known and unknown risks, uncertainties, and other factors, which may cause the actual results, performance, or achievements

of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. A

number of factors could cause actual results to differ materially from a conclusion, forecast or projection contained in the forward-looking statements in this

Report, including, but not limited to, the following material factors: operational risks; risks related to the cost estimates of exploration; sovereign risks associated

with the Company's operations in

Chile

; changes in estimates of mineral resources of properties where the Company holds interests; recruiting qualified personnel

and retaining key personnel; future financial needs and availability of adequate financing; fluctuations in mineral prices; market volatility; exchange rate fluctuations;

ability to exploit successful discoveries; the production at or performance of properties where the Company holds interests; ability to retain title to mining

concessions; environmental risks; financial failure or default of joint venture partners, contractors or service providers; competition risks; economic and market

conditions; and other risks and uncertainties described elsewhere in this report and elsewhere in the Company's public disclosure record.

Although the forward-looking statements contained in this Report are based upon assumptions which the Company believes to be reasonable, the Company

cannot assure investors that actual results will be consistent with these forward-looking statements. With respect to forward-looking statements contained in this

Report, the Company has made assumptions regarding: future commodity prices and demand; availability of skilled labour; timing and amount of capital

expenditures; future currency exchange and interest rates; the impact of increasing competition; general conditions in economic and financial markets; availability

of drilling and related equipment; effects of regulation by governmental agencies; future tax rates; future operating costs; availability of future sources of funding;

ability to obtain financing; and assumptions underlying estimates related to adjusted funds from operations. The Company has included the above summary of

assumptions and risks related to forward-looking information provided in this Report to provide investors with a more complete perspective on the Company's

future operations, and such information may not be appropriate for other purposes. The Company's actual results, performance or achievement could differ

materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events

anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits the Company will derive therefrom.

For additional information with respect to these and other factors and assumptions underlying the forward-looking statements made herein, please refer to the

public disclosure record of the Company, including the Company's most recent Annual Report, which is available on SEDAR+ (

www.sedarplus.ca

) under the

Company's issuer profile. New factors emerge from time to time, and it is not possible for management to predict all those factors or to assess in advance the

impact of each such factor on the Company's business or the extent to which any factor, or combination of factors, may cause actual results to differ materially

from those contained in any forward-looking statement.

The forward-looking statements contained in this report are expressly qualified by the foregoing cautionary statements and are made as of the date of this

Report. Except as may be required by applicable securities laws, the Company does not undertake any obligation to publicly update or revise any forward-looking

statement to reflect events or circumstances after the date of this Report or to reflect the occurrence of unanticipated events, whether as a result of new

information, future events or results, or otherwise. Investors should read this entire report and consult their own professional advisors to ascertain and assess the

income tax and legal risks and other aspects of an investment.

Director's Report

The Directors of Hot Chili Limited present their report on the consolidated entity consisting of Hot Chili Limited ("the Company" or "Hot Chili") and the entities it

controlled ("consolidated entity" or "the Group") at the end of, or during, the half-year ended

31 December 2024

Directors

The following persons held office as directors of Hot Chili Limited at the date of this report or were directors at any time during the half-year ended

31 December

2024

, unless otherwise stated:

Nicole Adshead-Bell

(Independent Non-Executive Chairman) (Resigned

11 March 2025

)

Christian Easterday

(Managing Director)

Roberto de Andraca Adriasola

(Non-Executive Director)

Mark Jamieson

(Non-Executive Director)

Stephen Quin

(Independent Non-Executive Director) (Resigned

11 March 2025

)

Principal Activities

The principal continuing activity of the consolidated entity is mineral exploration.

Significant Changes in the State of Affairs

During the half year under review, significant changes in the state of affairs of the consolidated entity were as follows:

November 2024

, the Company executed an Option Agreement to acquire a 100% interest in the historical La Verde Copper Mine (La Verde), located 30 km

south of the Company's low-altitude, Costa Fuego copper-gold project in

Chile

December 2024

, the Company announced significant copper-gold, porphyry-style mineralisation at La Verde, with

202m

grading 0.6% copper, 0.3g/t gold from

70m

depth.

Results of Operations for the Half-Year Ended

31 December 2024

The results of the consolidated entity from continuing operations after providing for income tax and non-controlling interest for the half-year ended

31 December

2024

was a loss of

$6,509,483

(half-year ended

31 December 2023

: loss of

$4,131,534

Dividends

No dividends were paid or declared since the end of the previous year ending

30 June 2024

. The Directors do not recommend the payment of a dividend.

Rounding Off of Amounts

The Company is of a kind referred to in

ASIC

Corporations (Rounding in Financial/Directors' Reports) Instrument 2016/191

, dated

24 March 2016

, issued by the

Australian Securities and Investments Commission. Therefore, the amounts contained in the Directors' Report and in the financial report have been rounded to the

nearest dollar in accordance with that Corporations Instrument, unless otherwise stated.

Review of Operations and Qualifying Statements

Refer to the Review of Operations report in Section 1 and associated Qualifying Statements in Section 2.

Matters Subsequent to Reporting Date

31 December 2024

6 January 2025

, the Company issued 352,913 Service Rights and 366,094 Performance Rights under an employee incentive scheme. The Service and

Performance Rights have been issued effective from the individuals start dates with the Company.

7 January 2025

, announced that 1,850,001 options had expired without exercise or conversion.

4 February 2025

, the Company announced that 1,259,789 options had expired without exercise or conversion.

11 February 2025

, Hot Chili reported a second round of strong assay results from its La Verde copper-gold discovery, located approximately 30km south of

the Company's Costa Fuego Copper-Gold Project planned central processing hub at low elevation in the coastal range of the Atacama region, Chile. The

Company has now completed 19 RC drill holes (

5,700 m

) at La Verde, with assay results from 12 holes reported so far confirming a major copper-gold porphyry

discovery in

Chile's

coastal range.

11 March 2025

Nicole Adshead-Bell

, Non-Executive Chairman and Mr

Stephen Quin

, Non-Executive Director tendered their resignations, effectively

immediately.

Auditors' Independence Declaration

A copy of the auditor's independence declaration as required under section 307C of the

Corporations Act 2001

is set out immediately after this Directors' Report.

This report is made in accordance with a resolution of the Board of Directors made pursuant to section 306(3)(a) of the

Corporations Act 2001

Signed on behalf of the Board of Directors by:

Christian Easterday

Managing Director

Dated this 13

day of

March 2025

Perth

Western Australia

For the Auditor's Independence Declaration and the Indpendent Auditor's Review Report, please refer to SEDAR+.

Director's Declaration

In the opinion of the Directors:

a) the attached financial statements and notes thereto comply with the

Corporations Act 2001

, the accounting standards (including Australian Accounting

Standard AASB 134

Interim Financial Reporting

), the

Corporations Regulations 2001

and other mandatory professional reporting requirements;

b) the attached financial statements and notes thereto give a true and fair view of the consolidated entity's financial position as at

31 December 2024

and of

its performance for the half-year ended on that date; and

c) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.

This declaration is made in accordance with a resolution of the Board of Directors made pursuant to section 303(5)(a) of the

Corporations Act 2001

Signed on behalf of the Board of Directors by:

Christian Easterday

Managing Director

Dated this 13

day of

March 2025

Perth

Western Australia

Statement of Profit or Loss and Other Comprehensive Income

For the Half-Year Ended

31 December 2024

Consolidated Entity

Half-Year Ended

Note

Dec 2024

Dec 2023

Interest income

350,031

173,425

Total Income

350,031

173,425

Depreciation

(98,050)

(65,336)

Corporate fees

(254,732)

(221,257)

Legal and professional

(654,930)

(290,490)

Employee benefits expense

(1,065,067)

(961,504)

Administration expenses

(680,568)

(454,355)

Accounting fees

(84,378)

(17,033)

Marketing expenses

(595,620)

(607,061)

Travel costs

(100,003)

Tenement write off

(2,909,169)

Foreign exchange gain

98,946

207,735

Share-based payments expense

(754,210)

(1,860,807)

Direct costs expensed

(1,350)

Finance costs

(29,598)

(19,961)

Total Expenses

(7,028,726)

(4,390,072)

Loss before income tax

(6,678,695)

(4,216,647)

Income tax expense

Loss After Income Tax

(6,678,695)

(4,216,647)

Other comprehensive income

Total Comprehensive Loss

(6,678,695)

(4,216,647)

Loss Attributable To:

Non-controlling interest

(169,212)

(85,113)

Owners of Hot Chili Limited

(6,509,483)

(4,131,534)

(6,678,695)

(4,216,647)

Basic and diluted loss per share (cents) attributable

to the owners of Hot Chili Limited

(5.27)

(3.46)

The above Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with the accompanying notes.

Statement of Financial Position

As at

31 December 2024

Consolidated Entity

Note

Dec 2024

June 2024

Current Assets

Cash and cash equivalents

19,032,095

33,741,518

Other current assets

342,885

278,530

Total Current Assets

19,374,980

34,020,048

Non-Current Assets

Plant and equipment

198,266

162,654

Exploration and evaluation expenditure

224,663,494

215,831,609

Right-of-use assets

418,562

508,689

Other non-current assets

400,761

359,309

Total Non-Current Assets

225,681,083

216,862,261

Total Assets

245,056,063

250,882,309

Current Liabilities

Trade and other payables

2,803,139

2,608,414

Provisions

237,209

267,526

Lease liabilities

181,779

162,588

Total Current Liabilities

3,222,127

3,038,528

Non-Current Liabilities

Provisions

26,262

24,591

Lease liabilities

306,847

392,014

Total Non-Current Liabilities

333,109

416,605

Total Liabilities

3,555,236

3,455,133

Net Assets

241,500,827

247,427,176

Equity

Contributed equity

297,713,521

297,651,726

Share-based payments reserve

7,136,250

6,445,699

Foreign currency translation reserve

1,222

Accumulated losses

(82,829,379)

(76,319,896)

Capital and Reserves Attributable to

Owners of Hot Chili Limited

222,021,614

227,778,751

Non-controlling interest

19,479,213

19,648,425

Total Equity

241,500,827

247,427,176

The above Statement of Financial Position should be read in conjunction with the accompanying notes.

Statement of Changes in Equity

For the Half-Year Ended

31 December 2024

Consolidated

Contributed

Equity

Share-Based

Payments

Reserve

Foreign

Currency

Translation

Reserve

Accumulated

Losses

Non-Controlling

Interest ("NCI")

Total

Equity

Entity

Half-Year Ended Dec 2024

Balance at 1 July 2024

297,651,726

6,445,699

1,222

(76,319,896)

19,648,425

247,427,176

Loss for the period

(6,509,483)

(169,212)

(6,678,695)

Total Comprehensive Loss

(6,509,483)

(169,212)

(6,678,695)

Share issue costs

(1,864)

Rights exercised

63,659

(63,659)

Share-based payments

754,210

Balance at 31 Dec 2024

297,713,521

7,136,250

1,222

(82,829,379)

19,479,213

241,500,827

Half-Year Ended Dec 2023

Balance at 1 July 2023

269,189,573

5,230,152

1,222

(71,081,853)

19,309,663

222,648,757

Loss for the period

(4,131,534)

(85,113)

(4,216,647)

Total Comprehensive Loss

(4,131,534)

(85,113)

(4,216,647)

Performance rights lapsed

(2,331,333)

2,331,333

Share-based payments

1,860,807

Balance at 31 Dec 2023

269,189,573

4,759,626

1,222

(72,882,054)

19,224,550

220,292,917

The above Statement of Changes in Equity should be read in conjunction with the accompanying notes.

Statement of Cash Flows

For the Half-Year Ended

31 December 2024

Consolidated Entity

Half-Year Ended

Note

Dec 2024

Dec 2023

Cash Flows from Operating Activities

Payments to suppliers and employees

(3,522,097)

(2,802,824)

Interest received

355,726

118,364

Interest paid

(6)

(943)

Net Cash Used in Operating Activities

(3,166,377)

(2,685,403)

Cash Flows from Investing Activities

Payments for plant and equipment

(58,977)

(4,484)

Payments for tenements

(2,471,940)

(1,353,279)

Payments for exploration and evaluation

(8,856,940)

(7,017,096)

Proceeds on sale of NSR, net of transaction costs

21,286,690

Net Cash (Used in)/Received from Investing Activities

(11,387,857)

12,911,831

Cash Flows from Financing Activities

Share issue costs

(117,115)

Repayment of lease liabilities

(95,568)

(77,361)

Net Cash Used in Financing Activities

(212,683)

(77,361)

Net (decrease)/increase in cash held

(14,766,917)

10,149,067

Cash and cash equivalents at the beginning of the period

33,741,518

2,948,964

Foreign exchange differences on cash

57,494

222,855

Cash and Cash Equivalents at the End of the Period

19,032,095

13,320,886

The above Statement of Cash Flows should be read in conjunction with the accompanying notes.

Notes to the Financial Statements

For the Half-Year Ended

31 December 2024

SUMMARY OF MATERIAL ACCOUNTING POLICIES

Statement of Compliance

The half-year financial report is a general purpose financial report prepared in accordance with the requirements of the

Corporations Act 2001

and Australian

Accounting Standard AASB 134

Interim Financial Reporting

. Compliance with AASB 134 ensures compliance with International Financial Reporting Standard IAS

Interim Financial Reporting

The half-year financial report does not include full disclosures of the type normally included in an annual financial report. Accordingly, it is recommended that this

financial report be read in conjunction with the annual financial report for the year ended

30 June 2024

and any public announcements made by Hot Chili Limited

and its controlled entities during the half-year in accordance with the continuous disclosure requirements of the

Corporations Act 2001

Basis of Preparation

The same accounting policies and methods of computation have been followed in this interim financial report as were applied in the most recent annual financial

statements, unless otherwise stated. The accounting policies are consistent with Australian Accounting Standards and with IFRS Standards.

New or Amended Accounting Standards and Interpretations Adopted

The consolidated entity has adopted all new or amended accounting standards, interpretations and other accounting pronouncements issued by the Australian

Accounting Standards Board ("AASB") that are effective for reporting periods beginning on or after

1 January 2025

and therefore mandatory for the current

reporting period.

Any new or amended accounting standards, interpretations and other accounting pronouncements that are not yet mandatory have not been early adopted.

OPERATING SEGMENTS

The Company's operations are in one reportable business segment, being the exploration for Copper. The Company operates in one geographical segment,

being

Chile

The operating segment information is the same information as provided throughout the consolidated financial statements and therefore not duplicated. The

information reported to the CODM is on at least a monthly basis.

EXPLORATION AND EVALUATION EXPENDITURE

Consolidated Entity

Half-Year

Ended

31 Dec 2024

Year Ended

30 June

2024

Carrying amount at the beginning of the period

215,831,609

220,436,849

Tenement write off

(2,909,169)

Partial disposal of underlying mineral resource

and property rights, net of transaction costs

(21,286,690)

Consideration given for mineral exploration acquisition

2,471,940

2,625,969

Capitalised mineral exploration and evaluation

9,269,114

14,055,481

Carrying Amount at the End of the Period

224,663,494

215,831,609

In July 2023, the Company closed a US$15 million investment by Osisko Gold Royalties Limited, pursuant to which Hot Chili received proceeds of US$15 million in exchange for the sale of a 1% NSR royalty on copper and a 3% NSR royalty on gold across the Company's Costa Fuego

Copper-Gold Project.

Capitalised mineral exploration and evaluation is net of reimbursements of VAT recovered following approval for VAT refunds from the Chilean Tax Authorities.

Management have determined that the capitalised expenditure relating to the projects in Chile are still in the exploration phase and are to be classified as exploration and evaluation expenditure. In accordance with AASB 6 Exploration for and Evaluation of Mineral Resources,

management have assessed whether there are any indicators of impairment on the capitalised expenditure as at balance date. In making this assessment management have considered whether sufficient data exists to conclude that the exploration and evaluation assets are unlikely

to be recovered in full from successful development or sale. Based on this assessment, management are satisfied that there are no impairment indicators as at balance date.

Payments required under option and purchase agreements to secure tenements together with associated taxes & registration costs.

The future realisation of these non-current assets is dependent on further exploration and funding necessary to commercialise the resources or realisation through sale.

Marsellesa and Antofagasta Minerals S.A. (AMSA) Option agreements have been terminated due to unsuccessful exploration assessments by the Company. These terminations are not considered material to the exploration program.

RIGHT-OF-USE ASSETS

Consolidated Entity

Dec 2024

June 2024

Right-of-use assets at cost

831,495

Less: Accumulated amortisation

(412,933)

(322,806)

418,562

508,689

Reconciliation of Right-of-Use Assets

Half-Year

Ended

31 Dec 2024

Year Ended

30 June

2024

Opening balance

508,689

277,591

Additions

356,835

Amortisation

(90,127)

(125,737)

Closing balance

418,562

508,689

From the previous year up until 1 June 2024, the Chilean entities leased their previous office premises at Avenida Isidora Goyenechea, Las Condes, Santiago under an operating lease. The commitments for minimum lease payments in relation to the previous Chilean office was previously

disclosed in Note 17(c) of the Company's annual report for the year ended 30 June 2023. Effective on 1 June 2024, the Chilean entities entered into a new lease agreement for their new Chilean office premises at Lan Condes, Santiago, Republic of Chile. This lease has a fixed term of 3

years, with the option to renew for a further 3 years. The lease is denominated in "Unidad de Fomento", or "Development Units", which is a Chilean inflation-indexed unit of account.

During the year, the Company continued its leases for its premises at 768 Canning Highway, Applecross, Western Australia. The lease for the ground floor terminates on 28 February 2025 and the lease for the first floor terminates on 28 February 2026.

LEASE LIABILITIES

Consolidated Entity

Dec 2024

June 2024

Current

181,779

162,588

Non-current

306,847

392,014

488,626

554,602

Reconciliation of Lease Liabilities

Half-Year

Ended

31 Dec 2024

Year Ended

30 June

2024

Opening balance

554,602

333,608

Additions

356,835

Repayments

(110,692)

(162,742)

Interest

29,592

37,435

Foreign exchange differences

15,124

(10,534)

Closing balance

488,626

554,602

COMMITMENTS FOR EXPENDITURE

(a)

Exploration Commitments

In order to maintain current rights of tenure to exploration and mining tenements, the consolidated entity has the following discretionary exploration expenditure

requirements up until the expiry of leases. These obligations are not provided for in the financial statements and are payable as follows:

Consolidated Entity

31 Dec 2024

30 Jun 2024

Within one year

402,123

377,415

Later than one year but not later than five years

1,608,493

1,509,662

More than five years

4,825,479

4,906,401

6,836,095

6,793,478

(b)

Option Payment Commitments

The mining rights (which vary between 90% to 100%) of the various projects undertaken by Hot Chili will be transferred upon satisfaction of the option payments

committed as at

31 December 2024

, as tabled below:

Consolidated Entity

31 Dec 2024

30 Jun 2024

Within one year

3,506,514

4,378,019

Later than one year but not later than five years

32,765,000

22,388,285

More than five years

36,271,514

26,766,304

CONTINGENT LIABILITIES

VAT

As at

31 December 2024

, Hot Chili Limited had accumulated:

VAT refund payments of

$15,434,266

(

30 June 2024

$14,939,275

) with respect to VAT recovered as at

31 December 2024

by Sociedad Minera El Águila

SpA (refer to the table below); and

VAT refund payments of

$10,157,243

(

30 June 2024

$9,731,571

) with respect to VAT recovered as at

31 December 2024

by Sociedad Minera Frontera

SpA (refer to the table below).

Consolidated Entity

Dec 2024

June 2024

VAT recovered by Sociedad Minera El Águila SpA

(CLP 9,561,515; 30 June 2024: CLP 9,344,976,756 )

15,434,266

14,939,275

VAT recovered by Sociedad Minera Frontera SpA

(CLP 6,292,404; 30 June 2024: CLP 6,087,397,302)

10,157,243

9,731,571

Total VAT Recovered by Chilean Subsidiaries

(CLP 15,853,919; 30 June 2024: CLP 14,100,115,924)

25,591,509

24,670,846

Under the initial terms of the VAT refund payment, the consolidated entity initially had until the

31 December 2019

to commercialise production from Productora

and meet certain export targets. Hot Chili also had the right to extend this term. The Company exercised its right to extend the date of commercial production from

Productora with the Chilean Tax Authority. An extension to the benefit was extended to

30 June 2022

and a further extension until

30 June 2026

was also granted.

An agreement with Sociedad Minera Fronters SpA provides an extension to

31 December 2026

for exports related to the Cortadera deposit.

In the event that the term is not extended further and the Company does not meet certain export targets, the Company will be required to re-pay the VAT refund

payments to the Chilean Tax Authority subject to certain terms and conditions. However, if Hot Chili achieves the export targets within that timeframe or its

renewal, if required, any VAT refund payments will not be required to be repaid.

Future Royalty Payments

July 2023

, the Company closed an Investment Agreement with Osisko Gold Royalties Ltd ("Osisko"). Under the terms of the Investment Agreement Osisko

purchased a net smelter return royalty comprising 1% of payable copper production and 3% of gold payable production. Hot Chili retains a buyback right if a

change of control event occurs prior to the 4th anniversary of closing under the terms and conditions of the announcement dated

28 June 2023

CONTRIBUTED EQUITY

Consolidated Entity

31 Dec 2024

30 June 2024

Share Capital

No. Shares

Ordinary shares – fully paid

151,420,450

297,713,521

151,345,206

297,651,726

Movement in Ordinary Share Capital

Balance at the beginning of the period

151,345,206

297,651,726

119,445,206

269,189,573

Shares issued under Private Placement to institutional & professional investors

24,900,000

Shares issued under Share Purchase Plan to eligible shareholders

75,244

63,659

7,000,000

Less: Costs associated with issue of share capital

(1,864)

(3,437,847)

Balance at the End of the Period

151,420,450

297,713,521

151,345,206

297,651,726

Unlisted Options Over Ordinary Share Capital

Issue Date

Expiry Date

Balance at

1 July 2024

No.

Issued During

the Period

No.

Expiry /

Exercise

No.

Balance at

31 Dec 2024

No.

Exercisable at

31 Dec 2024

No.

20 Sep 2021

30 Sep 2024

1,850,001

(1,850,001)

4 Sep 2022

28 Jan 2025

1,259,789

25 Jul 2024

25 Jul 2026

1,914,000

5,023,790

(1,850,001)

3,173,789

Approved at the General Meeting of Shareholders on 4 July 2024.

The weighted average exercise price of options on issu

← Back to feed