Unaudited Condensed Consolidated Interim Financial Statements
For the nine-month period ended November 30, 2022
Notice of No Auditor Review
BRITISH VIRGIN ISLANDS / ACCESSWIRE / January 27, 2023 / These unaudited condensed consolidated interim financial statements of Bradda Head Lithium Limited (the "Company") have not been reviewed by the auditors of the Company.
Condensed Interim Consolidated Statement of Comprehensive Income
for the period ended November 30, 2022
Nine-month period ended November 30, 2022 (unaudited) | Nine-month period ended November 30, 2021 (unaudited) | Three-month period ended November 30, 2022 (unaudited) | Three-month period ended November 30, 2021 (unaudited) | |||
Notes | US$ | US$ | US$ | US$ | ||
Expenses | ||||||
General and administrative | 2 | (4,242,520) | (2,391,522) | (1,690,543) | (764,201) | |
Share based payment and warrant expense | 10 | (1,285,743) | (259,816) | (91,539) | (119,726) | |
Foreign exchange loss | (1,255,343) | (34,338) | (944,005) | (4,197) | ||
──────── | ──────── | ──────── | ──────── | |||
Operating loss | (6,783,606) | (2,685,676) | (2,726,087) | (888,124) | ||
Other income | ||||||
Warrant fair value re-measurement | 11 | 3,711,264 | - | 880,920 | - | |
Unrealised (loss) / gain on investment | (2,520) | 13,360 | - | 5,461 | ||
──────── | ──────── | ──────── | ──────── | |||
Loss before finance costs | (3,074,862) | (2,672,316) | (1,845,167) | (882,663) | ||
Finance costs | - | (32,832) | - | - | ||
──────── | ──────── | ──────── | ──────── | |||
Loss before income tax | (3,074,862) | (2,705,148) | (1,845,167) | (882,663) | ||
Income tax expense | - | - | - | - | ||
──────── | ──────── | ──────── | ──────── | |||
Loss for the period | (3,074,862) | (2,705,148) | (1,845,167) | (882,663) | ||
══════ | ══════ | ══════ | ══════ | |||
Other comprehensive income - foreign currency translation reserve | - | 186 | - | - | ||
──────── | ──────── | ──────── | ──────── | |||
Total comprehensive loss for the period | (3,074,862) | (2,704,962) | (1,845,167) | (882,663) | ||
══════ | ══════ | ══════ | ══════ | |||
Basic and diluted loss per share (US cents) | 12 | (0.81) | (1.50) | (0.49) | (0.49) |
The accompanying notes are an integral part of these consolidated interim financial statements.
Condensed Interim Consolidated Statement of Financial Position
as at November 30, 2022
Notes | November 30, 2022 (unaudited) | February 28, 2022 (audited) | |||
US$ | US$ | ||||
Non-Current assets | |||||
Deferred mining and exploration costs | 3 | 5,911,902 | 4,183,744 | ||
Exploration permits and licences | 4 | 2,255,368 | 1,549,076 | ||
Plant and equipment | 8 | 89,134 | 54,170 | ||
Advances and deposits | 6 | 507,906 | 88,594 | ||
Investment | 51,436 | 53,957 | |||
─────── | ─────── | ||||
Total non-current assets | 8,815,746 | 5,929,541 | |||
─────── | ─────── | ||||
Current assets | |||||
Cash and cash equivalents | 10,603,037 | 7,327,303 | |||
Trade and other receivables | 6 | 165,786 | 97,996 | ||
─────── | ─────── | ||||
Total current assets | 10,768,823 | 7,425,299 | |||
─────── | ─────── | ||||
Total assets | 19,584,569 | 13,354,840 | |||
═══════ | ═══════ | ||||
Equity | |||||
Share premium | 9 | 30,467,820 | 23,434,385 | ||
Retained deficit | (12,966,339) | (11,177,220) | |||
─────── | ─────── | ||||
Total equity | 17,501,481 | 12,257,165 | |||
─────── | ─────── | ||||
Current liabilities | |||||
Trade and other payables | 7 | 1,071,603 | 1,097,675 | ||
Warrant liability | 11 | 1,011,485 | - | ||
─────── | ─────── | ||||
Total current liabilities | 2,083,088 | 1,097,675 | |||
─────── | ─────── | ||||
Total equity and liabilities | 19,584,569 | 13,354,840 | |||
═══════ | ═══════ |
The accompanying notes are an integral part of these consolidated interim financial statements.
These condensed interim consolidated financial statements were approved by the Board of Directors on January 27, 2023 and were signed on their behalf by:
Denham Eke
Director
Condensed Interim Consolidated Statement of Changes in Equity
for the period ended November 30, 2022
Share premium | Retained deficit | Total | ||
US$ | US$ | US$ | ||
Balance at March 1, 2022 (audited) | 23,434,385 | (11,177,220) | 12,257,165 | |
Total comprehensive loss for the period | ||||
Loss for the period | - | (3,074,862) | (3,074,862) | |
────── | ─────── | ─────── | ||
Total comprehensive loss for the period | - | (3,074,862) | (3,074,862) | |
Transactions with owners of the Company | ||||
Issue of ordinary shares (note 9 and note 11) | 7,581,351 | - | 7,581,351 | |
Share issue costs capitalised (note 9) | (547,916) | - | (547,916) | |
Equity settled share-based payments (note 10) | - | 1,285,743 | 1,285,743 | |
────── | ─────── | ────── | ||
Total transactions with owners of the Company | 7,033,435 | 1,285,743 | 8,319,178 | |
────── | ─────── | ────── | ||
Balance at November 30, 2022 (unaudited) | 30,467,820 | (12,966,339) | 17,501,481 | |
═══════ | ═══════ | ═══════ |
The accompanying notes are an integral part of these consolidated interim financial statements.
Condensed Interim Consolidated Statement of Changes in Equity
for the period ended November 30, 2022 (continued)
Share premium | Retained deficit | Foreign currency translation reserve | Total | |||||||
US$ | US$ | US$ | US$ | |||||||
Balance at March 1, 2021 (audited) | 9,443,676 | (9,056,687) | 186 | 387,175 | ||||||
Total comprehensive loss for the period | ||||||||||
Loss for the period | - | (2,705,148) | - | (2,705,148) | ||||||
────── | ─────── | ─────── | ─────── | |||||||
Total comprehensive loss for the period | - | (2,705,148) | - | (2,705,148) | ||||||
Transactions with owners of the Company | ||||||||||
Issue of ordinary shares (note 8) | 11,904,439 | - | - | 11,904,439 | ||||||
Share issue costs capitalised (note 8) | (413,731) | - | - | (413,731) | ||||||
Equity settled share-based payments (note 9) | - | 259,816 | - | 259,816 | ||||||
Transfer to retained deficit | - | 186 | (186) | - | ||||||
────── | ─────── | ─────── | ────── | |||||||
Total transactions with owners of the Company | 11,490,708 | 260,002 | (186) | 11,750,524 | ||||||
────── | ─────── | ─────── | ────── | |||||||
Balance at November 30, 2021 (unaudited) | 20,934,384 | (11,501,833) | - | 9,432,551 | ||||||
═══════ | ═══════ | ═══════ | ═══════ | |||||||
The accompanying notes are an integral part of these consolidated interim financial statements.
Condensed Interim Consolidated Statement of Cash Flows
for the period ended November 30, 2022
Notes | Nine-month period ended November 30, 2022 (unaudited) | Nine-month period ended November 30, 2021 (unaudited) | Three-month period ended November 30, 2022 (unaudited) | Three-month period ended November 30, 2021 (unaudited) | |
US$ | US$ | US$ | US$ | ||
Cash flows from operating activities | |||||
Loss before income tax | (3,074,862) | (2,705,148) | (1,845,167) | (882,663) | |
Adjusted for non-cash and non-operating items: | |||||
Depreciation | 8 | 23,708 | - | 9,532 | - |
Unrealised loss/(gain) on investment | 2,520 | (13,360) | - | (5,461) | |
Non-cash interest expense | - | 32,832 | - | - | |
Equity settled share based payments expense | 10, 11 | 1,285,743 | 259,816 | 91,539 | 119,726 |
Warrant fair value re-measurement | 11 | (3,711,264) | - | (880,920) | - |
Unrealised FX adjustment on convertible loan note | - | - | - | - | |
Unrealised FX on cash balances | 1,255,343 | (34,338) | 944,005 | (4,197) | |
─────── | ─────── | ─────── | ─────── | ||
(4,218,812) | (2,460,198) | (1,681,011) | (772,595) | ||
Change in trade and other receivables | (487,103) | 51,470 | (26,609) | 255,140 | |
Change in trade and other payables | (26,070) | 341,132 | 717,835 | 226,133 | |
─────── | ─────── | ─────── | ─────── | ||
Net cash flows used by operating activities | (4,731,985) | (2,067,596) | (989,785) | (291,322) | |
Cash flows from investing activities | |||||
Amounts paid for deferred mining and exploration costs | 3 | (1,728,158) | (1,121,721) | (1,452,815) | (964,459) |
Amounts paid for licences and permits | 4 | (706,292) | (519,455) | (16,495) | (112,018) |
Equipment purchased | 8 | (58,672) | - | - | - |
─────── | ─────── | ─────── | ─────── | ||
Net cash flows used by investing activities | (2,493,122) | (1,641,176) | (1,469,310) | (1,076,477) | |
Cash flows from financing activities | |||||
Short-term loan received | - | 60,000 | - | - | |
Cash received from shares and warrants issued | 9, 11 | 12,304,100 | 9,598,923 | - | - |
Share issue costs paid | 9 | (547,916) | (413,731) | - | - |
─────── | ─────── | ─────── | ─────── | ||
Net cash flows from financing activities | 11,756,184 | 9,245,192 | - | - | |
─────── | ─────── | ─────── | ─────── | ||
Increase / (decrease) in cash and cash equivalents | 4,531,077 | 5,536,420 | (2,459,095) | (1,367,799) | |
Cash and cash equivalents at beginning of period | 7,327,303 | 86,972 | 14,006,137 | 7,021,332 | |
Effect of foreign exchange on cash balances | (1,255,343) | 34,338 | (944,005) | 4,197 | |
─────── | ─────── | ─────── | ─────── | ||
Cash and cash equivalents at end of period | 10,603,037 | 5,657,730 | 10,603,037 | 5,657,730 | |
═══════ | ═══════ | ═══════ | ═══════ | ||
The accompanying notes are an integral part of these consolidated interim financial statements.
1 Reporting Entity and basis of preparation
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 February 28, 2022 ("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 February 28, 2022, which is available on the Group's website: www.braddheadltd.com, and on SEDAR at www.sedar.com. These unaudited condensed consolidated interim financial statements should be read in conjunction with the audited Consolidated Financial Statements for the year ended February 28, 2022.
2 General and administrative
The Group's general and administrative expenses include the following:
Nine-month period ended November 30, 2022 (unaudited) US$ | Nine-month period ended November 30, 2021 (unaudited) US$ | Three-month period ended November 30, 2022 (unaudited) US$ | Three-month period ended November 30, 2021 (unaudited) US$ | |
Auditors' fees | 114,508 | 62,067 | 13,067 | 35,466 |
Directors and management fees and salaries | 402,231 | 310,653 | 132,955 | 120,942 |
Legal and accounting | 422,228 | 510,218 | 247,291 | 83,665 |
Contractor costs | 1,979,619 | 732,407 | 719,097 | 280,162 |
Professional and marketing costs | 942,495 | 535,899 | 332,928 | 203,672 |
Other administrative costs | 381,439 | 240,278 | 245,205 | 40,294 |
─────── | ─────── | ─────── | ─────── | |
Total | 4,242,520 | 2,391,522 | 1,690,543 | 764,201 |
═══════ | ═══════ | ═══════ | ═══════ |
3 Deferred mine exploration costs
The schedule below details the exploration costs capitalised to date:
Total | |
US$ | |
Cost and net book value | |
At February 28, 2021 (audited) | 1,767,274 |
Capitalised during the year | 2,501,853 |
Disposal under the royalty agreement | (85,383) |
─────── | |
At February 28, 2022 (audited) | 4,183,744 |
─────── | |
Capitalised during the period | 1,728,158 |
─────── | |
At November 30, 2022 (unaudited) | 5,911,902 |
═══════ | |
Cost and net book value | |
At November 30, 2022 (unaudited) | 5,911,902 |
At February 28, 2022 (audited) | 4,183,744 |
═══════ |
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 November 30, 2022. 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 February 28, 2022, 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:
Total | |
US$ | |
Cost and net book value | |
At February 28, 2021 (audited) | 691,465 |
Capitalised during the year | 1,119,455 |
Disposal under the royalty agreement | (31,614) |
Impairment | (230,230) |
─────── | |
At February 28, 2022 (audited) | 1,549,076 |
Capitalised during the period | 706,292 |
─────── | |
At November 30, 2022 (unaudited) | 2,255,368 |
═══════ | |
Cost and net book value | |
At November 30, 2022 (unaudited) | 2,255,368 |
At February 28, 2022 (audited) | 1,549,076 |
═══════ |
The Group assessed the carrying amount of the licences and permits held for impairment as at November 30, 2022. 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 February 28, 2022, an impairment charge of US$ 230,230 was recognised as a result of project licences and permits that were not renewed.
5 Investment in subsidiary undertakings
As at November 30, 2022 and February 28, 2022, the Group had the following subsidiaries:
Name of company | Place of incorporation | Ownership interest | Principal activity |
Bradda Head Limited* | BVI | 100% | Holding company of entities below |
Zenolith (USA) LLC | USA | 100% | Holds USA lithium licences and permits |
Verde Grande LLC | USA | 100% | Holds USA lithium licences and permits |
Gray Wash LLC | USA | 100% | Holds USA lithium licences and permits |
* 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 March 1, 2022 to November 30, 2022, and up to the date that control ceases.
6 Trade and other receivables and advances and deposits
Non-current
November 30, 2022 (unaudited) | February 28, 2022 (audited) | |
US$ | US$ | |
Advances and deposits | 507,906 | 88,594 |
══════ | ══════ |
Current
November 30, 2022 (unaudited) | February 28, 2022 (audited) | |
US$ | US$ | |
Prepayments and other debtors | 165,786 | 97,996 |
══════ | ══════ |
7 Trade and other payables
November 30, 2022 (unaudited) | February 28, 2022 (audited) | |
US$ | US$ | |
Trade payables | 950,402 | 1,019,175 |
Accrued expenses and other payables | 121,201 | 78,500 |
────── | ────── | |
1,071,603 | 1,097,675 | |
══════ | ══════ |
8 Plant and equipment
Motor vehicle | Total | |
Cost | US$ | US$ |
As at March 1, 2021 (audited) | - | - |
Additions during the year | 55,718 | 55,718 |
────── | ────── | |
As at February 28, 2022 (audited) | 55,718 | 55,718 |
Additions during the period | 58,672 | 58,672 |
────── | ────── | |
As at November 30, 2022 (unaudited) | 114,390 | 114,390 |
══════ | ══════ |
8 Plant and equipment (continued)
Motor vehicle | Total | |
Accumulated depreciation | US$ | US$ |
As at March 1, 2021 (audited) | - | - |
Depreciation charge for the year | (1,548) | (1,548) |
────── | ────── | |
As at February 28, 2022 (audited) | (1,548) | (1,548) |
Depreciation charge for the period | (23,708) | (23,708) |
────── | ────── | |
As at November 30, 2022 (unaudited) | (25,256) | (25,256) |
══════ | ══════ | |
Carrying amount | ||
As at November 30, 2022 (unaudited) | 89,134 | 89,134 |
As at February 28, 2022 (audited) | 54,170 | 54,170 |
══════ | ══════ |
9 Share premium
Authorised
The Company is authorised to issue an unlimited number of nil par value shares of a single class.
Shares | Share capital | Share premium | ||
Issued ordinary shares of US$0.00 each | US$ | US$ | ||
At February 28, 2021 (audited) | 75,040,282 | - | 9,443,676 | |
═══════ | ═══════ | ═══════ | ||
Shares issued for cash | 158,499,941 | - | 12,098,924 | |
Shares issued to settle loans | 48,618,529 | - | 2,159,722 | |
Shares issued in lieu of Directors fees | 3,037,362 | - | 145,794 | |
Shares issued to Zenith Minerals Limited * | 32,217,765 | - | ||
Share issue costs capitalised | - | - | (413,731) | |
─────── | ─────── | ─────── | ||
At February 28, 2022 (audited) | 317,413,879 | - | 23,434,385 | |
═══════ | ═══════ | ═══════ | ||
Shares issued for cash (note 11) | 73,195,560 | - | 7,581,351 | |
Share issue costs capitalised | - | - | (547,916) | |
─────── | ─────── | ─────── | ||
At November 30, 2022 (unaudited) | 390,609,439 | - | 30,467,820 | |
═══════ | ═══════ | ═══════ | ||
* In line with the agreement entered into with Zenith Minerals Limited ("Zenith"), shares were issued to Zenith to maintain their shareholding at 15%. Following the listing of the Company's shares on AIM in July 2021, the anti-dilution protection held by Zenith no longer applies to any new issues of shares. | ||||
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.
During the nine-month period ended November 30, 2022, outstanding fees due to directors totaling US$ Nil were settled by the issue of shares (28 February 2022: US$Nil)
Options and warrants
The total number of share options and warrants in issue as at the period end is set out below.
Recipient | Grant Date | Term in years | Exercise Price | Number at March 1, 2022 (audited) | Number Issued | Number Lapsed/ cancelled/expired | Number Exercised | Number at November 30, 2022 (unaudited) | Fair value | ||||||||||
Options | US$ | ||||||||||||||||||
Directors and Participants | April 2018 | 5 | US$ 0.15668 | 1,606,304 | - | - | - | 1,606,304 | 24,028 | ||||||||||
Directors and Participants | June 2021 | 5 | US$ 0.048 | 18,000,000 | - | - | - | 18,000,000 | 1,110,556 | ||||||||||
Directors and Participants | September 2021 | 5 | £0.09 | 4,000,000 | - | - | - | 4,000,000 | 314,962 | ||||||||||
Directors and Participants | April 2022 | 5 | £0.18 | - | 9,200,000 | - | - | 9,200,000 | 1,122,876 | ||||||||||
Warrants | |||||||||||||||||||
Supplier warrants | July 2021 | 5 | £0.0550 | 1,818,182 | - | - | - | 1,818,182 | 124,482 | ||||||||||
Supplier warrants | July 2021 | 3 | £0.0825 | 2,254,545 | - | - | - | 2,254,545 | 8,275 | ||||||||||
Shareholder warrants | December 2021 | 2 | £0.0885 | 1,185,687 | - | - | - | 1,185,687 | 44,858 | ||||||||||
Supplier warrants | April 2022 | 2 | £0.1350 | - | 3,244,331 | - | - | 3,244,331 | 284,918 | ||||||||||
─────── | ─────── | ─────── | ─────── | ─────── | ─────── | ||||||||||||||
28,864,718 | 12,444,331 | - | - | 41,309,049 | 3,034,955 | ||||||||||||||
═══════ | ═══════ | ═══════ | ═══════ | ═══════ | ═══════ | ||||||||||||||
10 Equity settled share based payments (continued)
The amount expensed in the income statement has been calculated by reference to the fair value at the grant date of the equity instrument and the estimated number of equity instruments to vest after the vesting period.
Nine-month period ended November 30, 2022 (unaudited) US$ | Nine-month period ended November 30, 2021 (unaudited) US$ | Three-month period ended November 30, 2022 (unaudited) US$ | Three-month period ended November 30, 2021 (unaudited) US$ | |
Share based payments charge | 1,285,743 | 259,816 | 91,539 | - |
═══════ | ═══════ | ═══════ | ═══════ |
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 2022 options
Award date and exercise price | |
Fair value at grant date | £0.09308 |
Exercise price | £0.180 |
Weight average expected volatility | 81.90% |
Weighted average expected life (years) | 5 |
Risk-free interest rate (based on comparable companies) | 1.52% |
Terms of the issued options are as follows:
- 9,200,000 options have been granted and are subject to the three independent vesting conditions for 1/3 of the entitlement, relating to the successful fund raising in respect of the Group's operational budget, commencement of a drilling program in respect of the San Domingo project and resolution of certain Wickieup project title claims. All un-exercised options expire after a period of 5 years from grant date. It is assumed that options are exercised within 5 years from date of grant. The applied volatility is based on historical volatility.
April 2022 supplier warrants
Award date and exercise price | |
Fair value at grant date | £0.06697 |
Exercise price | £0.135 |
Weight average expected volatility | 81.90% |
Weighted average expected life (years) | 2 |
Risk-free interest rate (based on comparable companies) | 0.80% |
Terms of the issued warrants are as follows:
- As part of the fundraise completed during April 2022, certain service providers of the Company received warrants for services rendered. As a result, 3,244,331 warrants have been issued. All un-exercised warrants expire after a period of 2 years from grant date. It is assumed that warrants are exercised within 2 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 nine-month period ended November 30, 2022, the Company awarded warrants to investors who participated in the fundraise completed during April 2022.
The total number of warrants in issue as at the period end is set out below.
Recipient | Grant Date | Term in years | Exercise Price | Warrants at March 1, 2022 (audited) | Number of Warrants Issued | Number of Warrants Lapsed/ cancelled/expired | Number of Warrants Exercised | Number of Warrants at November 30, 2022 (unaudited) | Fair value |
Warrants | US$ | ||||||||
Shareholder warrants | April 2022 | 2 | £0.2100 | - | 73,195,560 | - | - | 73,195,560 | 1,011,485 |
─────── | ─────── | ─────── | ─────── | ─────── | ─────── | ||||
- | 73,195,560 | - | - | 73,195,560 | 1,011,485 | ||||
═══════ | ═══════ | ═══════ | ═══════ | ═══════ | ═══════ |
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$ 3,711,264 (period ended November 30, 2021: Nil) within Warrant Fair Value Re-Measurement.
Reconciliation of warrant liability fair value:
Fair value | |
US$ | |
Balance at March 1, 2022 | - |
Warrants issued during the period | 4,722,749 |
Fair value re-measurement | (3,711,264) |
─────── | |
Balance at November 30, 2022 | 1,011,485 |
═══════ |
11 Warrants (continued)
April 2022 shareholder warrants
Grant date fair value | Award date and exercise price |
Fair value at grant date | £0.0492 |
Exercise price | £0.21 |
Weight average expected volatility | 81.90% |
Weighted average expected life (years) | 2 |
Risk-free interest rate (based on comparable companies) | 0.80% |
November 30, 2022 fair value | Award date and exercise price |
Fair value | £0.0118 |
Exercise price | £0.21 |
Weighted average expected volatility | 80.5% |
Weighted average expected life remaining (years) | 1.39 |
Risk-free interest rate (based on comparable companies) | 4.38% |
As part of the fundraise completed during April 2022, all participating shareholders received a warrant on 1:1 basis for shares acquired. As a result, 73,195,560 warrants have been issued. All un-exercised warrants expire after a period of 2 years from grant date. It is assumed that warrants are exercised within 2 years from date of grant. The applied volatility is based on historical volatility.
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$ 3,074,862 (nine-month period to November 30, 2021: loss of US$ 2,052,489) and the weighted average number of shares of 379,122,544 (at November 30, 2021: 147,618,936) 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 nine-month period ended November 30, 2022, Directors' and Officers' insurance was obtained on an arms-length basis through Edgewater, which is a 100% subsidiary of Manx Financial Group ("MFG"). James Mellon and Denham Eke are Directors of both the Company and MFG.
During the period, the premium payable on the policy was US$ 49,318 (year ended February 28, 2022: US$ 44,303), of which US$ 32,122 was prepaid as at the period end (February 28, 2022: US$ 11,076).
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, equating to approximately US$ 415,454 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 21 December 2022, the Company awarded 500,000 ordinary share options each to Euan Jenkins and Alex Borrelli, independent non-executive directors of the Company.
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SOURCE: Bradda Head Lithium Limited