THM

Business Context and Reporting Period

Company: International Tower Hill Mines Ltd. (ITH)

Filing Type: Form 10-Q (Quarterly Report)

Reporting Period: Three and six months ended June 30, 2025

Business Overview: ITH is a mineral exploration company focused on the Livengood Gold Project in Alaska, USA. The company is in the development stage with no revenue-generating operations. It holds a 100% interest in the project, which contains proven and probable reserves of 430.1 million tonnes at an average grade of 0.65 g/tonne. The company is currently advancing metallurgical studies, environmental data collection, and community engagement.

Key Financial Metrics

Note: The company has no debt. Total liabilities consist of accounts payable and accrued liabilities.

Material Changes vs. Prior Period

• Net Loss Increase: Net loss for the six months ended June 30, 2025, increased by approximately $617,000 (31%) compared to the same period in 2024.
• Operating Expenses: Total operating expenses rose by $326,757. The primary driver was an increase in mineral property exploration expenditures ($950,396 vs. $759,055), largely due to higher advance minimum royalty payments ($150,724 increase) and timing variances in legal and environmental costs.
• Share-Based Compensation: Expenses related to stock options and Deferred Share Units (DSUs) increased to $509,981 for the six-month period, up from $359,333 in the prior year.
• Foreign Exchange: The company recorded a foreign exchange loss of $208,431 for the six months ended June 30, 2025, compared to a gain of $64,435 in the prior year, due to fluctuations in the CAD/USD exchange rate.
• Liquidity Improvement: Cash and cash equivalents increased significantly from $992,487 at December 31, 2024, to $2,845,065 at June 30, 2025. This was driven by a non-brokered private placement raising approximately $3.9 million.

Guidance, Outlook, and Risks

Outlook and Capital Resources: Management believes current cash reserves are sufficient to fund the 2025 work program (budgeted at $3.7 million) and general administrative costs for the next 12 months. The 2025 work program focuses on metallurgical studies of stibnite antimony mineralization, baseline environmental data collection, and community engagement. The company anticipates operating at a loss for the foreseeable future.

Financing Needs: The company has no revenue-generating operations and will require significant additional financing to continue operations, advance the Livengood Gold Project, and potentially develop a mine. There is no assurance that additional financing will be available on acceptable terms.

Risks and Contingencies:

• Going Concern: Continued operations depend on the ability to secure additional equity financing or strategic alliances.
• Permitting: Delays in obtaining necessary permits for the Livengood Gold Project could increase costs and delay timelines.
• Market Conditions: Results are subject to volatility in gold prices and general economic conditions.
• PFIC Status: The company is classified as a Passive Foreign Investment Company (PFIC) for U.S. federal income tax purposes, which may have adverse tax consequences for U.S. shareholders.

Investor Verification Checklist

• Verify the sufficiency of the $2.8 million cash balance against the $3.7 million 2025 budget and potential cost overruns.
• Confirm the status of the Livengood Gold Project permitting process and any regulatory hurdles.
• Review the terms of the recent private placement and the dilution impact on existing shareholders (8.2 million shares issued).
• Assess the company's ability to raise further capital given the lack of revenue and the current equity market environment.
• Monitor the foreign exchange impact on operating costs, as the company operates in the U.S. but is incorporated in Canada.