Bradda Head Lithium Ltd Announces Unaudited Interim Results

Unaudited Interim Results for the six and three-months ended 31 August 2023

Bradda Head Lithium Ltd (AIM:BHL)(TSX-V:BHLI)(OTCQB:BHLIF), the North America-focused lithium development group, is pleased to announce that it has today published its unaudited financial results for the six and three-months ended 31 August 2023, and the Management's Discussion and Analysis for the same period

Both of the above have been posted on the Company's website www.braddaheadltd.com and are also available on SEDARplus (www.sedarplus.ca/landingpage).

Financial and operational highlights

• The Company's third drill programme at the lithium in clay Basin project continued during the period, with the Company finishing the fourteenth and final hole on August 10, 2023 for a total drilled meterage of 2,355.
• Notable intervals from the final few sonic core holes continued to be encouraging and include:
• 81.60m @ 944ppm Li in hole BES23-10, including 19.79m @ 1,325ppm,
• 82.30m @ 906ppm Li in hole BES23-07, including 20.87m @ 1,324ppm,
• 81.98m @ 867ppm Li in hole BES23-06, including 20.73m @ 1,363ppm,
• 88.70m @ 903ppm Li in hole BES23-11, including 12.51m @ 1,427ppm, and
• 75.12m @ 983ppm Li in hole BES23-12, including 27.6m @ 1,339ppm.
• Following the release of an updated Mineral Resource Estimate ("MRE") post period end, which included a contained LCE tonnage of over 1Mt LCE, and as per the Royalty Agreement with the Lithium Royalty Corporation ("LRC"), Bradda Head formally requested payment of US$ 2.5 million from LRC, with funds being received during October 2023.
• During August 2023, the Company also mobilised a drill rig at its San Domingo pegmatite asset, with the Phase 3 drilling programme commencing later in the month.
• In addition, the Company staked just under 8km² of new lode claims at its San Domingo pegmatite project, further strengthening its land holding in the area.

Ian Stalker, Chairman of Bradda Head, commented:

"The first half of the financial year has naturally been very busy, with significant drilling programmes being undertaken at our Basin and San Domingo Properties in Arizona, USA. This phase of drilling is now completed at our Basin project. Positive assay results received from the Basin work, enabled the release of an updated MRE during September 2023, which included a contained LCE tonnage of over 1Mt LCE. This new Resource number reported resulted in the next stage of a royalty payment of US$ 2.5 million. The Company is therefore well placed financially to continue its planned work programme well into 2024. We also commenced our Phase 3 drilling programme at our San Domingo pegmatite asset during August 2023. This is a follow on from our Phase 1 and Phase 2 drill programmes, our aim being to extend the known lithium mineralization in this dstrict. Assay results have been slow to arrive due to the summer rush at the laboratory, and the Company hopes to have news on San Domingo within the next few weeks as preliminary results have started to arrive.

The pace of development will continue through the final half of the year, and we look forward to updating our shareholders as we receive the exploration results."

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF THE MARKET ABUSE REGULATION (EU No.596/2014) AS IT FORMS PART OF UK DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018. UPONTHE PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS INSIDE INFORMATION IS NOWCONSIDERED TO BE IN THE PUBLIC DOMAIN AND SUCH PERSONS SHALL THEREFORE CEASE TO BE IN POSSESSION OF INSIDEINFORMATION.

For further information please visit the Company's website: www.braddaheadltd.com

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About Bradda Head Lithium Ltd.
Bradda Head Lithium Ltd. is a North America-focused lithium development group. The Company currently has interests in a variety of projects, the most advanced of which are in Central and Western Arizona: The Basin Project (Basin East Project, and the Basin West Project) and the Wikieup Project.

The Basin East Project has an Indicated Mineral Resource of 17 Mt at an average grade of 940 ppm Li and 3.4% K for a total of 85 kt LCE and an Inferred Mineral Resource of 210 Mt at an average grade of 900 ppm Li and 2.8% K (potassium) for a total of 1.0 Mt LCE. In the rest of the Basin Project SRK has determined an Exploration Target of 250 to 830 Mt of material grading between 750 to 900 ppm Li, which is equivalent to a range of between 1 to 4 Mt contained LCE. The Group intends to continue to develop its three phase one projects in Arizona, whilst endeavouring to unlock value at its other prospective pegmatite and brine assets in Arizona, Nevada, and Pennsylvania. All Bradda Head's licences are held on a 100% equity basis and are in close proximity to the required infrastructure. Bradda Head is quoted on the AIM of the London Stock Exchange with the ticker of BHL, on the TSX Venture Exchange with a ticker of BHLI, and on the US OTCQB market with a ticker of BHLIF.

Forward-Looking Statements
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. This News Release includes certain "forward-looking statements" which are not comprised of historical facts. Forward-looking statements include estimates and statements that describe the Company's future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Forward-looking statements may be identified by such terms as "believes", "anticipates", "intends to", "expects", "estimates", "may", "could", "would", "will", or "plan". Since forward-looking statements are based on assumptions and address future events and conditions, by their very nature they involve inherent risks and uncertainties. Although these statements are based on information currently available to the Company, the Company provides no assurance that actual results will meet management's expectations. Risks, uncertainties, and other factors involved with forward-looking information could cause actual events, results, performance, prospects, and opportunities to differ materially from those expressed or implied by such forward-looking information. Forward looking information in this news release includes, but is not limited to, following: The Company's objectives, goals, or future plans. Factors that could cause actual results to differ materially from such forward-looking information include, but are not limited to: failure to identify mineral resources; failure to convert estimated mineral resources to reserves; delays in obtaining or failures to obtain required regulatory, governmental, environmental or other project approvals; political risks; future operating and capital costs, timelines, permit timelines, the market and future price of and demand for lithium, and the ongoing ability to work cooperatively with stakeholders, including the local levels of government; uncertainties relating to the availability and costs of financing needed in the future; changes in equity markets, inflation, changes in exchange rates, fluctuations in commodity prices; delays in the development of projects, capital and operating costs varying significantly from estimates; an inability to predict and counteract the effects of COVID-19 on the business of the Company, including but not limited to the effects of COVID-19 on the price of commodities, capital market conditions, restriction on labour and international travel and supply chains; and the other risks involved in the mineral exploration and development industry, and those risks set out in the Company's public documents filed on SEDARplus. Although the Company believes that the assumptions and factors used in preparing the forward-looking information in this news release are reasonable, undue reliance should not be placed on such information, which only applies as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, other than as required by law.

Bradda Head Lithium Limited

Management discussion and analysis for the six and three-month period ended August 31, 2023

This management's discussion and analysis ("MD&A") reports on the operating results and financial condition of the Company for the six and three-month period ended August 31, 2023, and is prepared as of October 25, 2023. The MD&A should be read in conjunction with Bradda Head Lithium Limited's (the "Company" or "Bradda Head") audited consolidated financial statements for the year ended February 28, 2023, and the notes thereto which were prepared in accordance with International Financial Reporting Standards ("IFRS").

All dollar amounts referred to in this MD&A are expressed in United States dollars except where indicated otherwise.

b) Overview

Bradda Head Lithium Limited was incorporated on October 28, 2009, in the British Virgin Islands under the British Virgin Islands Companies Act with registered number 1553975 with the name Copper Development Corporation. On October 5, 2015, the Company changed its name from Copper Development Corporation to Life Science Developments Limited, and on April 18, 2018, the Company changed its name to Bradda Head Holdings Limited. On September 15, 2021, the Company changed its name to Bradda Head Lithium Limited.

The Company has one business segment, being mineral exploration. The Company is focused on appraising and developing lithium mining projects within North America and currently has interests in a variety of projects in the United States.

Corporate and Exploration Highlights

Exploration Highlights

Set forth in this section is a description of the Company's material mineral projects. All scientific and technical data contained in this MD&A has been reviewed and approved by Joey Wilkins, B.Sc., P.Geo., who is Chief Operating Officer at Bradda Head and a Qualified Person as defined by National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101").

Arizona Sedimentary Hosted Lithium Projects

Basin Project

Drilling at Basin East Extension ("BEE") continued during the three-month period ended August 31, 2023. During July 2023, assay results from a further five drill holes were received. The programme continued to encounter better-than-expected thicknesses of clay, confirming that lithium-bearing clays continue and thicken to the west, northwest and north into the Company's BEE lease with projected clay extensions into Basin West ("BW") claims. Drilling has confirmed the clays extend into Basin North ("BN") where the potential to expand is significant.

Notable intervals from these five widely spaced sonic core holes continue to be encouraging and include:

• 81.60m @ 944ppm Li in hole BES23-10, including 19.79m @ 1,325ppm,
• 82.30m @ 906ppm Li in hole BES23-07, including 20.87m @ 1,324ppm and
• 81.98m @ 867ppm Li in hole BES23-06, including 20.73m @ 1,363ppm.

The results from these three holes indicate a high-grade unit exists, as previously found in Basin East ("BE") and has similar grades and maintains strong continuity across all of BEE, likely extending into BW. This is very positive for any future mining operation, as the high-grade unit sits in the upper clay unit which forms the shallowest part of the deposit, essentially cropping out at BE. The assay results also identified high levels of molybdenum associated with drill holes BES23-06, 07, 09, and 10 and within the high-grade unit of between 109ppm over 22.56m in hole 06 and 187ppm over 16.44m in hole 10. To put that in context, Freeport's Bagdad copper mine (c.6 miles from Basin) which extracts a healthy molybdenum by-product credit, has a molybdenum Proven and Probable Reserve grade of c.200ppm.

During August 2023, the final drill hole assay results were received, with the highest single interval grade identified so far of 2,791ppm Li over 0.40m and a separate sample of 641 ppm Mo over 1.22m.

Notable intervals from the next 2 widely-spaced sonic core holes continue to be encouraging and include:

• 88.70m @ 903ppm Li in hole BES23-11, including 12.51m @ 1,427ppm
• 75.12m @ 983ppm Li in hole BES23-12, including 27.6m @ 1,339ppm

Basin East & East Extension Highlights

Note: all lengths represent true thickness as sedimentary sequence is horizontal and holes are vertical (90 degrees to stratigraphy)

The assay results from the final drill holes continued to detect high levels of molybdenum within the high-grade unit, such as 289ppm Mo over 8.84m in BES23-11 within 21.04m of 167ppm and 15.56m of 148 I BES23-12. A detailed XRD analysis of the Basin core is under construction, with the intent of identifying the mineralogy associated with high grade lithium and molybdenum. The remarkable continuity and consistency of the lithium intercepts in the upper clay suggest the presence of extensive lithium mineralisation throughout the project area, indicating the potential for a sizeable lithium deposit. Following completion of the drill programme, the results were fed into an updated Mineral Resource Estimate, released post quarter-end on 28 September 2023.

The lithium-clay mineralisation remains open to the west and north, indicating further resource upside, as backed up by the previously reported 1Mt to 6Mt LCE JORC-compliant Exploration Target identified by SRK. The total upper clay unit is 78.40m in width on average in BEE and the first hole into BN intercepted 86.11m of upper clay. To put that in context, the average thickness of the upper clay unit at BE is 34.00m in all the previous 34 holes that intercepted upper clay in the last 3 drill programmes (2018, 2021 and 2022).

The recent drill results on BEE and BN solidify Bradda Head's belief in a widespread and continuous lithium-rich stratigraphic sequence, with potential further into BN and across to BW that the Company believes will lead to significant resource growth and opportunity to become a Tier 1 lithium deposit. More drilling is being planned at Basin North and Basin West upon receipt of the Environmental Assessment ("EA") from the Bureau of Land Management, expected during H2 2024. The area being permitted is over 11km², which is considerably larger than BE, BEE, and BN combined (c.6km²).

Wikieup Project

No significant work has been undertaken on this project during the 3-month period.

Arizona Pegmatite District
San Domingo Project

During August 2023, the Company mobilised a drill rig at its San Domingo pegmatite asset, with the Phase 3 drilling programme commencing later in the month. This represents the second large-scale drill programme conducted in less than 12 months at San Domingo, underscoring the Company's commitment to exploring and unlocking the potential of our 23km² land package within this highly prospective pegmatite district.

Bradda Head was granted an exploration permit to drill at its Northern claim block in the San Domingo Pegmatite district. The Phase 3 drill programme has been rigorously designed, benefiting from a comprehensive array of data and analyses. Bradda's team of geologists conducted an extensive soil geochemistry survey, undertook a thorough structural mapping programme, reviewed previous GPR geophysical data, and carried out additional ground truthing to optimize the locations and potential effectiveness of this exploration campaign. Several new high priority targets have been identiifed, which the Company is excited about and anticipates making new discoveries and extending known lithium mineralization from the previous programme.

The first two phases of drilling, completed in March 2023, yielded promising results, with the best intercept reported as 31.85m at 1.6% Li₂O at the Midnight Owl prospect in the Northern claim block. Phase 3 drilling will aim to extend this known lithium mineralization.

Following positive results of soil sampling completed in February 2023 that identified further spodumene in outcrops at San Domingo, and to strengthen our land holding position, Bradda Head staked just under 8km² of new lode claims at its San Domingo asset. This is the 4th round of claim expansion at San Domingo, and the land holding has grown from c.13km² to now c.31km² since July 2021.

The soil sampling survey conducted in February 2023 highlighted specific areas within the existing claim block that displayed highly prospective indicators for lithium exploration. Follow-up field work on select geochemical anomalies positively identified lithium bearing minerals at nearly all anomalies, dominated by the presence of spodumene. By expanding the current claim block to trace these areas along strike, the Company aims to maximise the potential for significant lithium resources and solidify its position in the region's rapidly evolving lithium market. Additionally, the newly staked claims provide a buffer zone, ensuring effective management and protection of the Company's interests in the area.

The Company looks forward to keeping shareholders updated on the progress of the ongoing drill programme at San Domingo.

Nevada Lithium Brine Projects

Wilson Project

No significant work has been undertaken on this project during the 3-month period.

Eureka Project

No significant work has been undertaken on this project during the 3-month period.

Corporate Highlights

During June 2023, the Company appointed PKF Littlejohn LLP as new auditors of the Company, replacing KPMG Audit LLC. As the Company is listed on the TSX Venture Exchange, the Company is required to retain an auditor recognised by the Canadian Public Accountability Board ("CPAB"). KPMG Audit LLC, who has been the Company's auditor since 2009, is not a participating auditor firm with CPAB and therefore resigned at the request of the Company. Bradda Head appointed PKF Littlejohn LLP, a CPAB-recognised auditor, to audit the Company's financial statements as at and for the year ended February 28, 2023.

On 29 August 2023, the Company announced the resignation of Charles FitzRoy as CEO of the Company. During the previous 30 months, Charles was a key figure in a number of milestones, most notably listing the Company on AIM in Summer 2021 where £6.2 million was raised, securing a royalty partnership later that same year, and in raising approximately £10 million of fresh equity-capital in the Spring of 2022. The search for a new CEO is ongoing.

(b) Selected Financial Information

The following table sets forth selected financial information with respect to the Company for the six and three-month period ended August 31, 2023 and the year ended February 28, 2023. The selected financial information has been derived from the audited financial statements for the period indicated. The following should be read in conjunction with the said financial statements and related notes that are available on the Company's website - www.braddaheadltd.com.

The annual financial statements and interim financial statements are presented in US dollars and are prepared in accordance with IFRS, See "Summary Financial Data" and "Currency Information".

MANAGEMENT DISCUSSION AND ANALYSIS: QUARTER ENDED AUGUST 31, 2023

(c) Introduction

(d) This interim Management Discussion and Analysis (the "interim MD&A") should be read in conjunction with the audited financial statements of the Company for the year ended February 28, 2023, and related notes. This MD&A is made as of October 25, 2023.

(e) Results of Operations for the six and three-months ended August 31, 2023

The Company's net loss after tax for the six-month period to August 31, 2023 was US$ 2,229,852, compared to a loss of US$ 1,165,319 for the comparative period ended August 31, 2022. The major expenses for the six-month period ended August 31, 2023 were operational expenses incurred on the Company's exploration projects, and are broken down in the respective projects as follows:

During this six-month time period, the Company incurred and capitalised exploration expenditures of US$ 2,306,867, compared to US$ 965,140 for the comparative six-month period to August 31, 2022.

The capitalied exploration costs for the six-month period ended August 31, 2023 have been allocated amongst the Company's exploration projects in approximately the following amounts:

The exploration expenditures have been primarily costs associated with drilling, assaying, resource and mining consultants, metallurgical testing, environmental studies, project team fees, acquisition of new leases, and annual renewal of existing leases.

General and administrative expenses for the six-month period to August 31, 2023 totalled US$ 2,593,928, compared to US$ 2,551,978 for the comparative six-month period to August 31, 2022. General and administrative expenses are broken down as follows:

During the six-month period to August 31, 2023, there have been no changes in financial performance or other elements that relate to non-core business activities and operations.

(f) Cash flows

During the six-month period ended August 31, 2023, the Company had net cash outflows of US$ 6,242,378, compared to inflows of US$ 6,990,172 during the comparative six-month period to August 31, 2022. Net cash inflows for the current three-month period ended August 31, 2023, include placing cash amounts on short term deposits and receipt of cash from matured deposits, totalled US$ 411,283. The cashflows for the two periods are shown below:

* includes US$ 1,426,589 placed on short term deposit during the six-month period ended August 31, 2023, and receipt of maturing deposits of US$ 2,478,993 during the three-month period ended August 31, 2023.

(g) Liquidity and Capital Resources

As at August 31, 2023, the Company had cash and cash equivalents (including short term cash deposits) of US$ 42,930,730, and a working capital surplus of US$ 2,619,378. As of February 28, 2023, the Company had cash and cash equivalents of US$ 7,746,519, and a working capital surplus of US$ 7,135,119.

Post period end on 28 September 2023, the Company announced an updated Mineral Resource Estimate ("MRE") at the Company's Basin Project, Arizona. As per the Gross Overriding Royalty Agreement with the Lithium Royalty Company ("LRC"), this new contained LCE Tonnage, which was well over the contracted threshold of 1 million tonnes LCE, enabled the Company to trigger the payment of US$2.5 million from LRC, which was received by the Company in October 2023.

(h) Outstanding Share Data

As of August 31, 2023, the following securities were outstanding:

The Company's objectives when managing capital are to safeguard its ability to continue as a going concern, so that it can continue to provide returns for shareholders, benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

The capital structure of the Company includes cash and cash equivalents, equity attributable to equity holders comprised of contributed equity, reserves and accumulated losses. In order to maintain or adjust the capital structure, the Company may issue new shares, sell assets or adjust the level of activities undertaken by the Company.

The Company monitors capital based on cash flow requirements for operational, exploration and evaluation expenditures. The Company has no debt or other borrowings as at the date of this Application. The Company will continue to use capital market issuances to satisfy anticipated funding requirements.

The availability of equity capital, and the price at which additional equity could be issued, is dependent upon the success of the Company's exploration activities, and upon the state of the capital markets generally. Additional financing may not be available on terms favourable to the Company or at all. If the Company does not receive future financing, it may not be possible for the Company to advance the exploration and development of its mineral exploration properties. If the Company is not able to fund these minimum expenditures, it may not be able to maintain part or all of its mineral exploration property interests. See "Risk Factors".

(i) Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements.

(j) Transactions with Related Parties

The Company has conducted transactions with officers, directors and persons or companies related to directors or officers and paid or accrued amounts as follows:

Edgewater Associates Limited ("Edgewater")

During the six-month period ended 31 August 2023, Directors and Officers insurance was obtained through Edgewater, which is a 100% subsidiary of Manx Financial Group ("MFG"). James Mellon and Denham Eke are Directors of MFG and Denham Eke is a Director of Edgewater.

During the period, the premium payable on the policy was US$ 96,724 (year ended 28 February 2023: US$ 49,318), of which US$ 33,424 was prepaid as at the period end (28 February 2023: US$ 14,497).

(k) Critical Accounting Estimates

The preparation of financial statements in conformity with IFRS requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Such estimates and assumptions affect the carrying value of assets, and impact decisions as to when exploration and development costs should be capitalized or expensed.

As at August 31, 2023, the Company had incurred total capitalised exploration expenditures, including capitalised licence and permit costs, of US$ 11,881,133. Changes in management's judgment as to the prospective nature, assessment of the existence or otherwise of economically recoverable reserves, technical feasibility and/or commercial viability of the relevant tenements and the Company's intentions with respect to the relevant tenements, could affect the assessment of the recoverable amount.

The Company regularly reviews its estimates and assumptions: however, actual results could differ from these estimates and these differences could be material.

Bradda Head Lithium Limited

Unaudited Condensed Consolidated Interim Financial Statements
For the six and three-month period ended August 31, 2023

Chairman's statement

Introduction

I am pleased to present the unaudited Interim Results for Bradda Head Lithium Limited (the "Company" or "Bradda Head") for the six-month period ended 31 August 2023.

Operational review

The six-month period to 31 August 2023 has been both exciting and extremely busy for the Company, focussing on our key projects.

Basin Project

Drilling continued at our Basin clay project in Arizona, with the third drill programme in the area finishing the fourteenth and final hole on August 10, 2023 for a total drilled meterage of 2,355. The programme encountered better-than-expected thicknesses of clay, further confirming that lithium-bearing clays continue and appear to thicken to the north into the Company's Basin North ("BN") claims, and likely west into the Basin West ("BW") claims. The highest single interval grade to date was encountered during the programme, with assay results identifying a grade of 2,791ppm Li over 0.40m and a separate sample of 641 ppm Li over 1.22m.

Highlights from the 2023 Basin East ("BE") and Basin East Extension ("BEE") drill programme

Note: all lengths represent true thickness as sedimentary sequence is horizontal and holes are vertical (90 degrees to stratigraphy)

The high-grade unit previously found in BE has similar grades and maintains strong continuity across all of BEE and now confirmed into BN, likely extending into BW. This is positive for any future mining operation, as the high-grade unit sits in the upper clay unit which forms the shallowest part of the deposit and cropping out at BE. The remarkable continuity and consistency of the lithium intercepts in the upper clay suggest the presence of extensive lithium mineralisation throughout the project area, indicating the potential for a sizeable lithium deposit.

Following completion of the drill programme, the results were fed into an updated MRE conducted by SRK Consulting (UK) Ltd ("SRK"), an independent mining consultancy, released post quarter-end on 28 September 2023. Based on 2,355.20m of sonic drilling completed as part of the 2023 Basin drill programme, Bradda Head added 729 kt of Lithium Carbonate Equivalent ("LCE") to the Inferred Mineral Resource, for an updated total Inferred LCE content of 1.0 Mt. The total new Mineral Resource now comprises 17.0 million tonnes in the Indicated category at 940 ppm carrying 85kt LCE, and 210 million tonnes in the Inferred category at 900 ppm, carrying 1,000 kt LCE.

Mineral Resource Statement for Basin East, Basin East Extension and Basin North effective 1 September 2023

• Mineral Resource statement has an effective date of 1 September 2023.
• The Mineral Resource is reported using a cut-off grade of 550 ppm Li and is constrained to an optimised open pit shell, which was generated using the following assumptions: lithium carbonate metal prices of 22,000 USD/tLCE; State of Arizona royalty (selling cost) of 6%; operating costs of 40 USD/ tore; Li recovery of 72%; mining dilution and recovery of 0% and 100%; and pit slope angle of 45°.
• Tonnages are reported in metric units.
• Rounding as required by reporting guidelines may result in apparent summation differences between tonnes, grade and contained metal content which are not considered material.
• Conversion factor of Li metal to LCE = 5.323
• The figures above are reported on a gross basis given Bradda's 100% interest in the property

The average in situ grade of the Inferred Basin East Mineral Resource has increased from 694 to 900 ppm Li, a 30% increase.

Following the release of the updated MRE, which included a contained LCE tonnage of over 1Mt LCE, and as per the Royalty Agreement with LRC, Bradda Head formally requested payment of US$ 2.5 million from LRC, with funds being received during October 2023.

SRK were selected to complete the Mineral Resource Update analysis and applied a stringent approach to both the in-situ density measurement and the cut-off grade utilised. A lower in situ density and higher cut-off grade than previously reported resulted in a more robust estimate. A significant and pragmatic building block to develop the on-going test-work plan.

The recent drill results on BEE and BN solidify Bradda Head's belief in a widespread and continuous lithium-rich stratigraphic sequence, with potential further into BN and across to BW that the Company believes will lead to significant resource growth and opportunity to become a Tier 1 lithium deposit. More drilling is being planned at BN where a low impact Notice of Intent level exploration permit is in place and BW upon receipt of the Environmental Assessment ("EA") from the Bureau of Land Management, expected during in H2 2024. The area being permitted is over 11km², which is considerably larger than BE, BEE, and BN combined (c.6km²).

San Domingo Project

On 10 August 2023, the Company mobilised a drill rig for its Phase 3 drill programme at the San Domingo pegmatite district in Arizona, with drilling commencing later in the month. This represents the second large-scale drill programme conducted in less than one year at San Domingo, which underscores the Company's commitment to exploring and unlocking the potential of the 23km² land package held within this highly prospective pegmatite district.

Bradda Head was granted an exploration permit to drill at its Northern claim block in the San Domingo pegmatite district. The Phase 3 drill programme has been rigorously designed, benefiting from a comprehensive array of data and analyses. Bradda Head's team of geologists conducted an extensive soil geochemistry survey, undertook a thorough structural mapping programme, reviewed previous GPR geophysical data, and carried out additional ground truthing to optimize the locations and potential effectiveness of this exploration campaign. The results of this identified several new high priority targets, which the Company is excited about and anticipates making new discoveries and extending known lithium mineralization from the previous programme, completed during March 2023.

Following positive results of soil sampling completed in February 2023 that identified further spodumene in outcrops at San Domingo, and in order to strengthen our land holding position, Bradda Head staked just under 8km² of new lode claims at its San Domingo asset. This is the 4th round of claim expansion at San Domingo, and the land holding has grown from c.13km² to now c.31km² since July 2021.

The soil sampling survey conducted in February 2023 highlighted specific areas within the existing claim block that displayed highly prospective indicators for lithium exploration. Follow-up field work on select geochemical anomalies positively identified lithium bearing minerals at nearly all anomalies, dominated by the presence of spodumene. By expanding the current claim block to trace these areas along strike, the Company aims to maximise the potential for significant lithium resources and solidify its position in the region's rapidly evolving lithium market. Additionally, the newly staked claims provide a buffer zone, ensuring effective management and protection of the Company's interests in the area.

The Company looks forward to keeping shareholders updated on the progress of ongoing drill programme at San Domingo.

Financial Review

During the six-month period ended 31 August 2023, the Company recorded a loss for the period of US$ 2,229,852 (period ended 31 August 2022: US$ 1,165,319). As at period end, cash and cash deposit balances stood at US$ 2,930,730 (28 February 2023: US$ 7,746,519), capitalised deferred mining, exploration, licence and permit costs stood at US$ 11,881,133 (28 February 2023: US$ 9,574,266), and total assets were US$ 15,467,509 at 31 August 2023 (28 February 2023: US$ 18,198,559).

Post period end on 28 September 2023, the Company announced an updated MRE at the Company's Basin Project, Arizona. As per the Gross Overriding Royalty Agreement with LRC, this new contained LCE Tonnage, which was well over the contracted threshold of 1 million tonnes LCE, enabled the Company to trigger the payment of US$2.5 million from LRC, which was received by the Company in October 2023.

The Board are in ongoing discussions with legal advisors regarding the options available to recover the fraudulent option exercise payment, as communicated to shareholders on 29 March 2022. Updates will be provided when available.

Approach to Risk and Corporate Governance

The Company's general risk appetite is a moderate, balanced one that allows it to maintain appropriate growth, profitability and scalability, whilst ensuring full corporate compliance.

The Group's primary risk drivers include:

• Strategic, Reputational, Credit, Operational, Market, Liquidity, Foreign Exchange, Capital and Funding, Compliance and Conduct.

Our risk appetite has been classified as high under an "impact" matrix defined as Zero, Low, Medium and High. Appropriate steps have been taken and adequate controls implemented to monitor the risks of the Company, and the appropriate committees and reporting structures have been established, which under the Chairmanship of the Chairman, will monitor risks facing the Company.

Corporate

During June 2023, the Company appointed PKF Littlejohn LLP as new auditors of the Company, replacing KPMG Audit LLC. As the Company is listed on the TSX Venture Exchange, the Company is required to retain an auditor recognised by the Canadian Public Accountability Board ("CPAB"). KPMG Audit LLC, who has been the Company's auditor since 2009, is not a participating auditor firm with CPAB and therefore resigned at the request of the Company. Bradda Head appointed PKF Littlejohn LLP, a CPAB-recognised auditor, to audit the Company's financial statements as at and for the year ended February 28, 2023.

On 29 August 2023, the Company announced the resignation of Charles FitzRoy as CEO of the Company. During the previous 30 months, Charles was a key figure in a number of milestones, most notably listing the Company on AIM in Summer 2021 where £6.2 million was raised, securing a royalty partnership later that same year, and in raising approximately £10 million of fresh equity-capital in the Spring of 2022. The search for a new CEO is ongoing.

Strategy and Outlook

Global demand for lithium is estimated to increase significantly. A report published by Popular Mechanics during January 2023, and prepared based on data from the International Energy Agency, shows that the electrified economy in 2030 is estimated to need anywhere from 250,000 to 450,000 tonnes of lithium. During 2021, only 105 tonnes of lithium was produced. Lithium is an important building block for many components of renewable energy technology and infrastructure. In the clean energy race, the United States has been lagging behind in recent years. Under the Biden Administration, the United States is determined to break away from the dependence of China for production and manufacturing of lithium.

We believe that Bradda Head, with its diversified portfolio of projects located in the USA, is in a unique position to take advantage of this significant growth in US-based lithium demand, and in turn create value for shareholders.

John 'Ian' Stalker
Chairman
25 October 2023

Condensed Interim Consolidated Statement of Comprehensive Income
for the period ended 31 August 2023

The notes on pages 12 to 19 form an integral part of these condensed consolidated interim financial statements.

Condensed Interim Consolidated Statement of Financial Position
as at 31 August 2023

The notes on pages 12 to 19 form an integral part of these condensed consolidated interim financial statements.

These financial statements were approved by the Board of Directors on 25 October 2023 and were signed on their behalf by:

Denham Eke
Director

Condensed Interim Consolidated Statement of Changes in Equity

for the period ended 31 August 2023

The notes on pages 12 to 19 form an integral part of these condensed consolidated interim financial statements.

Condensed Interim Consolidated Statement of Changes in Equity

for the period ended 31 August 2023 (continued)

The notes on pages 12 to 19 form an integral part of these condensed consolidated interim financial statements.

Condensed Interim Consolidated Statement of Cash Flows

for the period ended 31 August 2023

The notes on pages 12 to 19 form an integral part of these condensed consolidated interim financial statements.

1 Reporting Entity

Bradda Head Lithium Limited (the "Company") is a company domiciled in the British Virgin Islands. The address of the Company's registered office is Craigmuir Chambers, Road Town, Tortola, British Virgin Islands. The Company and its subsidiaries together are referred to as the "Group".

The Company is a lithium exploration Group focused on developing its projects in the USA.

These interim financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting and should be read in conjunction with the last annual consolidated financial statements as at and for the year ended 28 February 2023 ("last annual financial statements"). They do not include all of the information required for a complete set of IFRS financial statements. However, selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in the Group's financial position and performance since the last annual financial statements.

The financial information in this report has been prepared in accordance with the Company's accounting policies and in consistency with the last annual financial statements. Full details of the accounting policies adopted by the Company are contained in the financial statements included in the Company's annual report for the year ended 28 February 2023, which is available on the Group's website: www.braddheadltd.com. These unaudited condensed consolidated interim financial statements should be read in conjunction with the audited Consolidated Financial Statements for the year ended 28 February 2023.

2 General and administrative

The Group's general and administrative expenses include the following:

3 Deferred mine exploration costs

The schedule below details the exploration costs capitalised to date:

The recoverability of the carrying amounts of exploration and evaluation assets is dependent on the successful development and commercial exploitation or sale of the respective area of interest, as well as maintaining the assets in good standing. The Group assessed the DMEC relating to areas for which licenses and permits are held, for impairment as at 31 August 2023. The Board concluded that no facts and circumstances have been identified which suggest the recoverable amount of these assets would not exceed the carrying amount and, as such, no impairment was recognised during the period.

During the year ended 28 February 2023, an impairment charge of US$ Nil was recognised.

4 Exploration permits and licences

The schedule below details the exploration permit and licence costs capitalised to date:

The Group assessed the carrying amount of the licences and permits held for impairment as at 31 August 2023. The Board concluded that no facts and circumstances have been identified which suggest the recoverable amount of these assets would not exceed the carrying amount and, as such, no impairment was recognised during the period.

During the year ended 28 February 2023, an impairment charge of US$ 19,470 was recognised as a result of project licences and permits that were not renewed.

5 Investment in subsidiary undertakings

As at 31 August 2023, the Group had the following subsidiaries:

* Held directly by the Company. All other holdings are indirectly held through Bradda Head Limited

** Formed on 8 May 2023

As at 28 February 2023, the Group had the following subsidiaries:

* Held directly by the Company. All other holdings are indirectly held through Bradda Head Limited

The condensed interim consolidated financial statements include the results of the subsidiaries for the full interim period from 1 March 2023 to 31 August 2023, and up to the date that control ceases.

6 Trade and other receivables and advances and deposits

Non-current

Current

7 Trade and other payables

8 Plant and equipment

9 Share premium

Authorised
The Company is authorised to issue an unlimited number of nil par value shares of a single class.

10 Equity settled share based payments

The cost of equity settled transactions with certain Directors of the Company and other participants ("Participants") is measured by reference to the fair value at the date on which they are granted. The fair value is determined based on the Black-Scholes option pricing model.

Options and warrants
The total number of share options and warrants in issue as at the period end is set out below.

10 Equity settled share based payments (continued)

The amount expensed in the income statement has been calculated by reference to the fair value at grant date of the equity instrument and the estimated number of equity instruments to vest after the vesting period.

The inputs used in the measurement of the fair values at grant date of the equity-settled share-based payment plans issued during the period are as follows:

April 2023 options

Terms of the issued options are as follows:

• 4,800,000 options have been granted that vest fully on grant date. All un-exercised options expire after a period of 5 years from admission date. It is assumed that options are exercised within 5 years from date of grant. The applied volatility is based on historical volatility.

11 Warrants

The cost of equity warrants granted during the period are measured by reference to the fair value at the date on which they are granted. The fair value is determined based on the Black-Scholes option pricing model.

During the six-month period ended 31 August 2023, no new warrants were issued (period ended 31 August 2022: 73,195,560 warrants).

The total number of warrants in issue as at the period end is set out below.

Guidance as per IAS 32: Financial Instruments has been applied in classifying these as a financial liability. This is due to the exercise price and the Company's functional currency being different. As a result, the fair value applied to the shareholder warrants has been classified as a financial liability. At period end, the warrant liability has been re-measured to fair value, with a corresponding entry to profit and loss of US$ 210,061 (period ended 31 August 2022: Nil) within Warrant Fair Value Re-Measurement.

Reconciliation of warrant liability fair value:

12 Basic and diluted loss per share

The calculation of basic profit per share of the Company is based on the loss for the period of US$ 2,229,852 (six-month period to 31 August 2022: loss of US$ 1,165,319) and the weighted average number of shares of 390,609,439 (at 31 August 2022: 349,139,509) in issue during the period.

Diluted loss per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares such as warrants and options. An adjustment for the dilutive effect of share options and warrants in the current period has not been reflected in the calculation of the diluted loss per share, as the effect would have been anti-dilutive, due the Company recognising a loss for the period.

13 Related party transactions and balances

Edgewater Associates Limited ("Edgewater")

During the six-month period ended 31 August 2023, Directors and Officers insurance was obtained through Edgewater, which is a 100% subsidiary of Manx Financial Group ("MFG"). James Mellon and Denham Eke are Directors of MFG and Denham Eke is a Director of Edgewater.

During the period, the premium payable on the policy was US$ 96,724 (year ended 28 February 2023: US$ 49,318), of which US$ 33,424 was prepaid as at the period end (28 February 2023: US$ 14,497).

14 Commitments and contingent liabilities

The Group has certain obligations to expend minimum amounts on exploration works on mining tenements in order to retain an interest in them, which would be approximately US$ 405,000 during the next 12 months. This includes annual fees in respect of licence renewals. These obligations may be varied from time to time, subject to approval and are expected to be filled in the normal course of exploration and development activities of the Company.

15 Events after the reporting date

On 28 September 2023, the Company announced an updated Mineral Resource Estimate ("MRE") at the Company's Basin Project, Arizona. As per the Gross Overriding Royalty Agreement with the Lithium Royalty Company ("LRC"), this new contained LCE Tonnage, which was well over the contracted threshold of 1 million tonnes LCE, enabled the Company to trigger the payment of US$2.5 million from LRC, which was received by the Company in October 2023.

ENDS

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SOURCE:Bradda Head Lithium Limited