Unaudited Interim Results 6 Months Ended 31/08/24

Andrada Mining Limited (AIM: ATM, OTCQB: ATMTF), a critical raw materials producer with mining and exploration assets in Namibia, announces its unaudited interim financial results for the six-months ended 31 August 2024 ("H1 2025").

A full copy of the H1 2025 results can also be found on the Company's website here: https://andradamining.com/investors/corporate-publications/

HIGHLIGHTS

Operational performance

§ Successful restructuring of Uis Tin Mining Company ("UTMC"), resulting in 100% ownership of Uis and Lithium Ridge.

§ Production of 25 tonnes of tantalum at a grade of approximately 11% with 15 tonnes sold to Afrimet by the end of the interim period.

§ Continuous Improvement Programme ("CI2") results in an increased recovery rate of 72% (H1 2024: 65%)

§ 14% increase in plant utilisation to 92% (H1 2024: 81%).

§ Increase in contained tin metal to 462 tonnes (H1 2024: 454 tonnes).

Financial performance

§ 22% increase in revenue to £10.8 million (H1 2024: £8.9 million).

§ 70% increase in gross profit to £2.6 million (H1 2024: profit of £1.5 million).

§ 42% improvement in operating loss to £1.5 million (H1 2024: loss of £2.5 million).

§ 60% improvement in total comprehensive loss to £1.9 million (H1 2024: loss of £4.9 million).

§ Average C1 operating cash cost per tonne of contained tin produced was US$18 690 (within management guidance).

§ Average C2 operating cost per tonne of contained tin produced was US$22 671 (within management guidance).

§ All-in sustaining cost ("AISC") per tonne of contained tin produced was US$27 730 (within management guidance).

§ Annual tin hedge agreement for 30% quarterly concentration production at US$33 000 per tonne expires in May 2025 subject to renewal.

§ Conclusion of the Bank Windhoek Limited ("BWL") NAD175 million (c£7.5 million) funding agreement.

§ Unaudited available cash balance, including undrawn facility on 31 August 2024, of £6.1 million (US$7.2 million) excluding £2.1 million undrawn facility.

POST-PERIOD

§ Earn-in agreement executed with Sociedad Química y Minera de Chile SA through its subsidiary SQM Australia (Pty) Ltd ("SQM") for the development of Lithium Ridge (ML133).

§ Brandberg West maiden exploration drill results indicated notable intersections of high-grade mineralisation.

§ Released FY2024 Sustainability Report.

Chief Executive Officer's Statement

Overview

As the year has progressed, the Company has made significant progress. The value-accretive restructuring of UTMC simplified Andrada's ownership and operational structure in the underlying licences while empowering our local partners through equity ownership participation at Group level. The restructuring has also created opportunities for more rapid asset development through project-specific financing solutions. We believe that our continued investment in exploration, metallurgy and asset development has earned us the social licence to operate and established strategic worldclass partnerships. During the interim period, we secured debt funding arrangements with established lenders, including Standard Bank of Namibia (tin hedge) and Bank Windhoek, for the implementation of our exciting growth projects.

The Company ramped up tantalum concentrate production, producing 25 tonnes and shipping 15 tonnes to our off-taker, AfriMet, by the end of the period. Despite an unforeseen mechanical breakdown at the processing plant, which marginally increased costs, our ongoing CI2 Programme has improved overall recovery rates. We expect significant performance improvements in FY 2026 as we begin to reap the benefits of various capital projects.

Our lithium pilot plant continues to provide critical information for potential off-take agreements and for the integration of the lithium production circuit into the current plant. Although much of the material produced at the pilot plant has been sent to potential off-take partners for testing, we also achieved the first commercial petalite sale during the period, demonstrating the suitability of Uis's ore for the global technical grade market. We are also advancing our metallurgical test work programme to unlock the petalite production project.

Recent results from the maiden drilling programme at Brandberg West confirmed significant mineralisation within the historical pit, and the extensions to the north. The exceptionally high-grade veins have added tungsten and copper to our portfolio of critical minerals. Ongoing drilling at Uis will enhance our understanding of various pegmatites and enable us to increase the resource. We plan to expand our mineralisation exploration programme across the Erongo region to identify potential assets for future expansion. Our goal is to position Andrada as a platform for production growth in critical raw materials within Namibia.

In addition to these operational advances, we have improved our operational safety culture and strengthened relationships with our communities. In H2 2025, we look forward to achieving key milestones regarding the SQM deal, petalite development and tin expansion. We also look forward to providing further material updates on the various ongoing initiatives.

Financial performance overview

Increased revenue and expansion

§ 22% increase in revenue to £10.8 million (H1 2024: £8.9 million).

§ Gross profit increased by 70% to £2.6 million (H1 2024: £1.5 million) and operating loss improved by 42% to £1.5 million (H1 2024: £2.5 million).

§ The net loss increased to £3.2 million (H1 2024: £2.8 million) primarily due to finance expenses. A significant portion of these expenses are related to the interest on the convertible note obligation that was settled in shares at the election of the supportive shareholders.

§ Administrative costs amounted to £4.1 million (H1 2024: £4 million) included one-off expenses related to the successful completion of the UTMC restructuring, the SQM agreement and the completion of the Bank Windhoek funding. While these strategic corporate actions are essential for growth, we constantly review and strive to minimise the related costs

§ Although the period saw high capital expenditure, these projects will begin to yield benefits in the coming financial year and place the Company on a strong platform for future growth.

The cash costs were within management guidance.

§ The C1 costs included higher maintenance costs that are expected to normalise toward the lower end of guidance in the new year.

§ The C2 costs were higher due to the introduction of the royalty expense at the beginning of the 2025 calendar year.

§ AISC, which includes capitalised waste stripping, is expected to reduce over time as we move into zones with lower stripping ratios and increase our volumes in line with the completion of the CI2 Programme and the tin expansion project. The steady production of tantalum will continue to credit operational cash costs and, additional metals produced will substantially reduce cash costs.

Strengthening the financial position

To support ongoing capital expansion programs related to tin and lithium development, the Company announced on 7 August 2024 the conclusion of the NAD175 million (c£7.5 million) financing package from Bank Windhoek through the subsidiary UTMC. The proceeds were primarily allocated to the retirement of existing facilities, growth initiatives, and working capital. This investment will not only benefit UTMC but also contribute to the overall economic development of the country. Management believes that the combination of the Bank Windhoek funding, income from tin and tantalum sales as well as proceeds from the post-period agreement with SQM provides sufficient liquidity to support all operational activities for the next 12 months. Furthermore, the Company is engaging with multiple strategic partners, off-takers, development agencies and debt providers for funding required to roll-out further capital projects that have been identified. The available cash on 31 August 2024 was £6.1 million (US$7.2 million) excluding £2.1 million undrawn facilities.

Operational performance overview

Key tin production metrics

All the numbers are unaudited

1 C1 operating cash costs refers to operating cash costs per unit of production excluding selling expenses and sustaining capital expenditure associated with Uis Mine.

2 C2 operating cash costs are equivalent to the C1 costs plus selling expenses including logistics, smelting and royalties.

3 All-in sustaining cost (AISC) incorporates all costs are related to sustaining production, capital expenditure associated with developing and maintaining the Uis operation as well as pre-stripping waste mining costs.

*Figures updated to reflect tantalum credits.

The ore processed increased by 8% YoY to 481 504 tonnes with the ore mined blended to improve ore utilisation and to maintain the grade in line with the reserve statement. The feed grade will continue to be maintained within the range of 0.135% to 0.145% tin. The plant processing rate was slightly lower at 132 tonnes per hour ("tph"), compared to 136 tph in H1 2024, mainly due to the enhanced maintenance implemented on the crushing circuit resulting in a slight decrease in the production of tin concentrate. The production of tantalum concentrate had a positive impact on the tin grade through the simultaneous removal of impurities resulting in the relatively higher contained tin volume.

Tin expansion

In March we launched the pre-concentrating project for the Uis mine to increase the tin grade and output from the processing plant to 1 600 tpa contained tin. The expansion entails improvements to the dry processing section through the installation of a coarse crushing and XRT ore-sorting pre-concentration circuit. We have received all the long-lead machinery for the circuit, and we have completed the detailed engineering plant design. Concurrent to the work on the pre-concentration project, we have extended our tin expansion strategy to include toll treatment production of higher-grade tin ore from emerging regional producers. The goal is to establish a tin production hub at Uis to enhance our pipeline and to entrench Andrada as a leading critical metals producer in Namibia.

The net effect of this multi-pronged approach will be an increase in tin metal production, in a cost-effective manner in the shortest period to achieve maximum benefit from the prevailing tin price. The pre-concentration project will be implemented alongside a high-grade tolling programme to achieve an optimal net increase in output. The initial phase of the tolling programme has been the identification of high-grade tin mineralisation zones of up to 1.5% from various mining operations within the Erongo region. The ongoing CI2 Programme complements the tin expansion by improving the efficiency of the plant through the elimination of production bottlenecks. To date the CI2 Programme has resulted in an increase in the tin recovery rate to 72% (H1 2024: 65%).

Tantalum production

Key tantalum production metrics

Although still nominal, tantalum contributed 1% to the group revenue in the interim results. We anticipate reaching the targeted quarterly volumes by the end of the financial year. The incremental cost of producing tantalum concentrate is low, resulting in more than 90% of the revenue being captured in EBITDA.

Lithium development update

Lithium pilot plant

A one-off spot sale of five tonnes of petalite to a ceramic producer was completed during the period under review marking a key milestone towards realising our objective to be a critical metals producer. We believe the sale, albeit small, was an endorsement of the commercial potential of petalite from Uis. The exposure of the high-grade ore at Uis following the accelerated push-back also increased the petalite bulk sample production which will be used by potential off takers. Although we continue to explore opportunities to sell concentrate produced, the pilot plant facility continues to be primarily utilised for offtake bulk sampling campaigns. Importantly, these testing campaigns coupled with the completion of the technical study will contribute to the integration of the lithium circuit to the existing processing plant at Uis.

Safety performance

At Andrada, we are committed to maintaining the highest safety standards across our operations. The implementation of Take5, Visible Felt Leadership and Elimination of Fatalities initiatives, coupled with the commitment from our operational teams, has driven significant improvements in safety outcomes. The LTIFR increased from 1.42⁴ in H1 2024 to 1.74 in the period under review while the TRIFR increased from 7.84 in H1 2024 to 9.24⁵ in H1 2025. Importantly, no fatalities were recorded during this period. The various measures, including quarterly safety audits and comprehensive training sessions, have been instrumental in strengthening our safety culture and enhancing overall workplace safety.

⁴Restated LTI number for H1 2024: In August 2024, we conducted a comprehensive review of our injury classification process and specific incident classifications. We have updated our Lost Time Injury (LTI) numbers with the previously reported figure of three (3) LTIs being revised to four (4) LTIs. ⁵Restated TRIFR number for H1 2024: As part of our safety KPI metric review, we have aligned our TRIFR calculation with ICMM reporting standards. This change excludes restricted workdays and first-aid injuries. Historic TRIFR data has been revised accordingly, resulting in a notable improvement in our TRIFR from FY2023 to FY2024.

POST-PERIOD

SQM partnership on spodumene - rich Lithium Ridge

On 9 September 2024, we signed a three-stage earn-in agreement with SQM. We were incredibly pleased to announce this partnership with a global leader in the lithium industry, representing the first African lithium partnership that SQM has entered into. This partnership further solidifies our belief in the Lithium Ridge asset as a potential world-class resource, and further establishes Andrada as a multi-asset, critical metals explorer and miner. We believe this partnership highlights the potential value of our entire asset portfolio. Furthermore, partnering with SQM provides the ideal partner to unlock the full potential of Lithium Ridge, while allowing continuation of the development of Uis through our existing financing relationships.

The SQM partnership aligns perfectly with our strategic objectives, enabling us to develop Uis's neighbouring lithium asset, through accelerated the exploration initiatives. The Agreement establish a long-term, value-creating relationship that incentivises operational milestones and delivers sustained returns for our shareholders. The introduction of a global lithium player will also place Namibia at the forefront of the African lithium development trajectory and unlock value for the mining industry.

The SQM agreement is subject to certain conditions precedent, including the Namibian Competition Commission approval. I am pleased to confirm that we have transferred the Environmental Compliance Certificate into the joint venture vehicle as one of the two outstanding conditions precedent and await the Namibian Competition Commission response to our application. Full details of the joint venture arrangement and the associated earn-in process are detailed in the Company's announcement of 9 September 2024. We are keen to start the project as soon as the outstanding approval is received from the Namibian Competition Commission. The Company will make further updates on progress.

Brandberg West maiden drilling results

The impressive drill results from our first drilling programme indicated significant high grades across multiple drill holes, showing up to 10% tin, 3.5% tungsten and 2% copper (See announcement dated 12 September and 16 October 2024). The exploration programme comprised 20 oriented diamond drill ("DD") holes for a total of 2 975 metres drilled.

The drill programme was successful as high-grade intersections were found within all the drill holes, covering the historical open pit area and virgin extensions to the north of the pit. The success of this exploration programme reinforces the Company's belief that the Erongo region of Namibia is well-endowed with critical metals and has the potential to yield substantial inventory. Furthermore, the results validate our approach of investigating areas with historical mining activity to bolster our portfolio.

Publication of the 2024 Sustainability Report

On 20 November 2024, we released the 2024 Sustainability Report outlining Andrada's sustainability framework and its focus on creating thriving, resilient communities, while ensuring responsible operations through best-practice environmental stewardship and robust governance. We are particularly proud of the significant progress we have made in progressing our ESG commitments this year, including a doubling of procurement expenditure within Namibia to £21 million, and maintaining a 99% Namibian workforce.

Additionally, a total of £3.5 million was spent towards salaries, royalties and social projects during the year under review within Namibia. This underlines the dedication to creating value for our host nation and delivering on the promise for an equitable partnership that drives economic growth in Namibia. The Company maintains the highest standards of ethics and transparency, aligning with international frameworks including IFC Performance Standards, ICMM Principles, GRI and GISTM. This commitment to good governance underpins Andrada's engagement with all stakeholders, from employees and local communities to governments and investors. As we continue to expand our operations, the commitment to responsible mining practices remains unwavering. We look forward to building on these achievements in the year ahead, and to ensuring that Andrada is well qualified to promote the energy transition through its portfolio of critical raw materials.

Glossary of abbreviations

Other comprehensive income/(loss)

Items that will or may be reclassified to profit or loss:

NOTES TO THE CONSOLIDATED INTERIM FINANCIAL INFORMATION

For the period ended 31 August 2024

Corporate information and principal activities

Andrada Mining Limited ("Andrada") was incorporated and domiciled in Guernsey on 1 September 2017 and admitted to the AIM market in London on 9 November 2017. The Company's registered office is at PO Box 282, Oak House, Hirzel Street, St Peter Port, Guernsey GY1 3RH and it operates from Illovo Edge Office Park, 2nd Floor, Building 3, Corner Harries and Fricker Road, Illovo, Johannesburg, 2116, South Africa. This financial information is for the period ended 31 August 2024 and comparative figures for the six-month period ended 31 August 2023 and for the year ended 29 February 2024 are shown.

As at 31 August 2024, the Andrada Group comprised:

1 Held directly by Andrada Mining Limited

2 Held by Greenhills Resources Limited

3 Held by Andrada Mining (Namibia) Pty Limited. Acquired 15% non-controlling interest during the period.

4 Held by Mokopane Tin Company Pty Limited

5 Held by Pamish Investments 71 Pty Limited

This financial information is presented in Pound Sterling (£) because that is the currency in which the Group has raised funding on the AIM market in the United Kingdom. Furthermore, Pound Sterling (£) is the functional currency of the ultimate holding company, Andrada Mining Limited. The Group's key subsidiaries, Andrada Namibia and Uis Tin Mining Company Pty Limited ("UTMC"), use the Namibian Dollar ("NAD") as their functional currency. The period-end spot rate used to translate all Namibian Dollar balances was £1 = NAD23.42 and the average rate for the period was £1 = NAD23.51.

• MATERIAL ACCOUNTING POLICIES
• Basis of accounting

The consolidated interim financial information has been prepared in accordance with UK-adopted international accounting standards. The consolidated interim financial information also complies with the AIM Rules for Companies, NSX Listing Requirements, OTCQB Listing Requirements and the Companies (Guernsey) Law, 2008 and shows a true and fair view.

The interim financial information for the six months to 31 August 2024 is unaudited and does not constitute statutory financial information. The statutory accounts for the year ended 29 February 2024 are available on the Company's website.

Going concern

The Group closely monitors and manages its liquidity risk and day-to-day working capital requirements. Cash forecasts are regularly produced, considering the global logistical challenges around sales, to ensure that there is sufficient cash within the Group to meet its obligations. The Group runs sensitivities for different scenarios, including but not limited to changes in commodity prices and exchange rates. The Group also routinely monitors the covenants associated with the borrowing facilities and proactively engages with Bank Windhoek, the lender, where there is any risk. The Group met the covenant requirements for the 31 August 2024 measurement period and, based on the latest forecasts, the Group will be able to meet its covenant obligations for the testing period to February 2025. For the purpose of assessing going concern, the Directors have prepared forecasts to November 2026.

The main estimates considered as part of the Directors' going concern assessment are production profiles, tin, lithium and tantalum prices, exchange rates and committed capital. The production profile is based on the Group's current achieved production post the completion of the expansion project, as well as the additional production on the successful completion of the continuous improvement capital project and ore sorter projects. In addition, the Group successfully raised £7.1m through the funding of Bank Windhoek, secured a partnership with SQM for the Lithium Ridge project, and maintains the possibility of future funding through a strategic partner. This further supports the liquidity requirements of the Group and its ability to meet its obligations in the ordinary course of business. The Group also retains the ability to flex its ongoing exploration and metallurgical capital expenditures in line with cash availability as well as macro-economic circumstances.

Based on the forecasts, additional funding will be required within the next 12 months for the purpose of envisaged capital and exploration projects without a strategic partner. As the Group is also entering a new market with reference to lithium sales, which are close to near-term production, the cash flow forecast has assumed the successful completion of the lithium pilot plant in order to deliver the business strategy. Further funding would be required for additional exploration and capital projects as well as studies related to the feasibility of the future growth phases. The Group believes it has several options available to it, including but not limited to use of the overdraft facility, restructuring of the debt, additional debt or equity, cost reduction strategies as well as potential off-take arrangements. The Directors are already at an advanced stage of securing additional funding for the next 12 months. However, this is yet to be finalised as at the date of approval of the financial statements. Thus, the Group is reliant on additional funding, which is not guaranteed. This indicates the existence of a material uncertainty which may cast significant doubt on the Group's ability to continue as a going concern and, therefore, the Group may be unable to realise its assets and discharge its liabilities in the ordinary course of business.

As a result of their review, and despite the aforementioned material uncertainty, the Directors have confidence in the Group's forecasts and that additional funding will be forthcoming. Accordingly, the Directors continue to adopt the going concern basis in preparing the consolidated financial statements. The financial statements do not include any adjustments that would result if the Group were unable to continue as a going concern.

• Basis of consolidation
• Subsidiaries

Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases. Inter-company transactions, balances and unrealised gains/losses on transactions between Group companies are eliminated. When necessary, amounts reported by subsidiaries have been adjusted to conform with the Group's accounting policies.

A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. Any excess or deficit of consideration paid over the carrying amount of the non-controlling interests is recognised in equity of the parent in transactions where the non-controlling interests are acquired or sold without loss of control. The Group has elected to recognise this effect in retained earnings.

Non-controlling interests

Non-controlling interests in subsidiaries are identified separately from the Group's equity therein. Those interests of non-controlling shareholders that present ownership interests entitling their holders to a proportionate share of the net assets upon liquidation are initially measured at fair value. Subsequent to acquisition, the carrying amount of non-controlling interests is the amount of those interests at initial recognition plus the non-controlling interests' share of subsequent changes in equity. Total comprehensive income is attributed to non-controlling interests even if this results in the non- controlling interests having a deficit balance.

Critical accounting estimates and judgements

In the application of the Group's accounting policies, the Directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are relevant. Actual results may differ from these estimates. Information about significant areas of estimation uncertainty considered by management in preparing the interim financial information is provided below.

Estimates and judgements are continually evaluated. Revisions to accounting estimates are recognised in the period in which the estimates are revised if the revision affects only that period, or in the period of revision and in future periods if the revision affects both current and future periods.

Going concern and liquidity

Significant estimates were required in forecasting cash flows used in the assessment of going concern, including tin, tantalum and lithium prices, levels of production, operating costs, and capital expenditure requirements. For further details, refer to the going concern considerations laid out earlier in Note 2(b).

Decommissioning and rehabilitation obligations

In determining the amount attributable to the rehabilitation liability, management used a risk-free discount rate of 12.31% (August 2023: 13% and February 2024: 12.31%), an inflation rate of 4.8% (August 2023: 5.3% and February 2024: 4.8%) and an estimated mining period of 12.1 years (August 2023: 12.9 years and February 2024: 12.6 years), being the Phase 1 expansion life of mine. The rates used are in line with the Namibian market rates. The decrease in the mining period is as a result of the increased mining volumes post the Phase 1 Expansion. The carrying amount of the rehabilitation obligations for the Group at 31 August 2024 was £1 270 629 (August 2023: £912 550 and February 2024: £1 152 121).

• Impairment indicator assessment for exploration and evaluation assets

Determining whether an exploration and evaluation asset is impaired requires an assessment of whether there are any indicators of impairment, including specific impairment indicators prescribed in IFRS 6 "Exploration for and Evaluation of Mineral Resources". If there is any indication of potential impairment, an impairment test is required based on value in use of the asset. The valuation of intangible exploration assets is dependent upon the discovery of economically recoverable deposits which, in turn, is dependent on future tin prices, future capital expenditures, environmental and regulatory restrictions, and the successful renewal of licences.

The Directors have concluded that there are no indications of impairment in respect of the carrying value of Namibian intangible assets at 31 August 2024 based on planned future development of the Namibian projects and current and forecast tin prices. Exploration and evaluation assets are disclosed fully in Note 10.

Impairment assessment for property, plant and equipment

Management has reviewed the Uis Tin Mine for indicators of impairment and has considered, among other factors, the operations to date at the Uis Tin Mine, forecast commodity prices, production profile, inflation rate, post-tax real discount rate and market capitalisation of the Group. Management identified the reduction in the tin price as an indicator of impairment. In undertaking the impairment review, management has also reviewed the underlying life of mine ("LoM") valuation model for Uis. The LoM valuation model is on a fair value less cost to develop basis and includes assessments of different scenarios associated with capital improvements and expansion opportunities. The impairment testing performed by management did not result in an impairment.

The forecasts require estimates regarding forecast tin, tantalum and lithium prices, ore resources, production, operating and capital costs. Under the base case forecast scenario, management used a forecast tin price of $26 000, tantalum price of $150 000, lithium price of $2 960 dropping to $1 051 in FY 2027, a post-tax real discount rate of 8.7%, an inflation rate of 5.5%, and a life of mine of 30 years. The forecast indicates sufficient headroom as at 31 August 2024.

The complex judgement in determining the recoverable amount of mining assets requires an estimation of the future tin price. The estimation of future tin price is subject to uncertainty considering the volatility of the market. Management has therefore compared the forecast tin price with the economic consensus estimates. Furthermore, a sensitivity analysis was performed by lowering the forecast tin prices by 5%, which also indicated sufficient headroom as at 31 August 2024.

As an additional test, management performed certain sensitivity calculations. These included raising the discount rate to 9.7% post-tax real rate, lowering plant recovery by 5% and increasing operating costs by 5%. In each of these circumstances, the forecast indicated sufficient headroom as at 31 August 2024.

Depreciation

Judgement is applied in making assumptions about the depreciation charge for mining assets when using the unit-of-production method in estimating the ore tonnes held in reserves. The relevant reserves are those included in the current approved LoM plan, which relates to the Phase 1 expansion. Judgement is also applied when assessing the estimated useful life of individual assets and residual values. The assumptions are reviewed at least annually by management, and the judgement is based on consideration of the LoM plan as well as the nature of the assets. The reserve assumptions included in the LoM plan are evaluated by management.

Capitalisation and depreciation of waste stripping

The Group has elected to capitalise the costs of waste stripping activities as these are necessary to allow improved access to the ore and, therefore, will result in future economic benefits. The costs of drilling, blasting, and load and haul of waste material are capitalised until such time that the underlying ore is used in production. These costs are then expensed on a proportional basis. The capitalised costs are included in the mining asset in property, plant and equipment and are expensed back into the statement of comprehensive income as depreciation. Capitalisation of waste stripping requires the Group to make judgements and estimates in determining the amounts to be capitalised. These judgements and estimates include, among others, the expected life of mine stripping ratio for each separate open pit, the determination of what defines separate pits, and the expected volumes to be extracted from each component of a pit for which the stripping asset is depreciated.

Determination of ore reserves

The Group estimates its ore reserves and mineral resources based on information compiled by appropriately qualified persons relating to geological and technical data on the size, depth, shape, and grade of the ore body and related to suitable production techniques and recovery rates. The estimate of recoverable reserves is based on factors such as tin prices, future capital requirements and production costs, along with geological assumptions and judgements made in estimating the size and grade of the ore body. There are numerous uncertainties inherent in estimating ore reserves and mineral resources. Consequently, assumptions that are valid at the time of estimation may change significantly if or when new information becomes available.

viii. Valuation of inventories

Judgement is applied in making assumptions about the value of inventories and inventory stockpiles, including tin prices, plant recoveries and processing costs, to determine the extent to which the Group values inventory and inventory stockpiles. The Group uses forecast tin prices to determine the net realisable value of the run of mine ("ROM") stockpile and the tin concentrate inventory on hand at period end. Inventory stockpiles are measured using actual mining and processing costs.

Determining the fair value of royalty debt

The measurement of the royalty obligation factors in numerous key inputs, and management makes use of a technical expert. These inputs include the forecast of the tin production and price over a period of 30 years, the risk-free rate and the credit spread. The tin price forecast was based on estimates provided by the Group as of 31 August 2024. The risk-free rate was based on the United States Constant Maturity Treasury rates commensurate with the terms as of the valuation date, as reported on the Federal Reserve website. The Group used a credit spread of 10.58% computed by backsolving the convertible notes to par and further adjusted down 3.5% to account for the lower risk factor as a result of the ongoing operations at Uis Tin Mining Company. The operating subsidiary attracts a lower risk factor due to it being closely aligned to the underlying tin mining operation and its performance since commissioned, relative to the holding company, which is implicitly subordinated. The royalty obligation is measured at fair value through profit and loss.

• Fair value estimation on the consideration paid during the acquisition of mining rights

As part of the accounting for the acquisition of the non-controlling interest in UTMC, part of the consideration was settled using the ML 129 licence. Due to the nature of the assets, certain exploration activities were undertaken, but the information gathered was insufficient to delineate a Mineral Resource as defined by the JORC 2012 (Joint Ore Reserves Committee) Mineral Reporting Code, or any other broadly accepted mineral reporting standard. When the fair value of assets recorded in the statement of financial position cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques including the discounted cash flow ("DCF") model.

The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. As a result, management estimated the fair value to be equivalent to the exploration costs, which served as the base amount for the transaction.

Adoption of new and revised standards

The following amendments, standards and interpretations were adopted by the Group from 1 March 2023:

• Amendments to IAS 12 - International Tax Reform - Pillar Two Model Rules
• Lease Liability in a Sale and Leaseback - Amendments to IFRS 16 Leases
• Amendments to IAS 1 - Presentation of Financial Statements and IFRS Practice Statement 2 Making Judgements - Disclosure of Accounting Policies

Accounting standards and interpretations not applied

• Lack of Exchangeability - Amendments to IAS 21 - The Effects of Changes in Foreign Exchange Rates
• Annual improvements to IFRS 1 (First-time Adoption of International Financial Reporting Standards), IFRS 7 (Financial Instruments: Disclosures and its accompanying guidance on implementing IFRS 7), IFRS 9 (Financial Instruments), IFRS 10 (Consolidated Financial Statements) and IAS 7 (Statement of Cash Flows).

The updated standards, interpretations and amendments may have a significant impact on the consolidated financial statements in the future as the Group holds financial instruments recognised under IFRS 9 and IFRS 7.

Revenue

Administrative expenses

The loss for the period has been arrived at after charging:

Other costs mainly consist of corporate overheads necessary to run the South African head office.

Finance INCOME AND EXPENSES

Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Factors affecting tax for the period - The tax assessed for the period at the Guernsey corporation tax charge rate of 0%, as explained below

Accumulated losses in the subsidiary undertakings for which there is an unrecognised deferred tax asset are £16 421 555 (August 2023: £9 379 913 and February 2024: £13 903 618)

Loss per share from continuing operations

The calculation of a basic loss per share of 0.21 pence (August 2023: loss per share of 0.18 pence and February 2024: loss per share of 0.56 pence) is calculated using the total loss for the period attributable to the owners of the Company of £3 215 983 (August 2023: loss of £2 755 819 and February 2024: loss of £8 438 465) and the weighted average number of shares in issue during the period of 1 591 793 522 (August 2023: 1 538 528 155 and February 2024: 1 551 422 631). Due to the loss for the period, the diluted loss per share is the same as the basic loss per share. The number of potentially dilutive ordinary shares in respect of share options, warrants and shares to be issued as at 31 August 2024 is 165 830 346 (August 2023: 76 309 563 and February 2024: 165 625 801). These potentially dilutive ordinary shares may have a dilutive effect on future earnings per share.

Intangible assets

The additions to the evaluation and exploration asset during the period mainly consist of expenses capitalised as part of the Phase 2 exploration drilling project, the metallurgical test work programme, environmental studies, and region exploration projects.

Property, plant and equipment

Additions to the mining asset under construction include capitalised costs and equipment purchased as part of the ore sorting circuit. Additions to the mining asset include capitalised costs and equipment purchased as part of the Uis Phase 1 Continuous Improvement project.

Inventories

The following is the split between the current and the non-current portion of the liability:

During 2022, a vehicle asset financing facility to the value of N$15 000 000 (c. £640 500) was provided by Standard Bank Namibia. Interest accrues on this facility at the Namibian prime rate less 1%.

On 21 July 2023, the Group issued 77 unsecured convertible loan notes of £100 000 each to new and existing investors. The notes have a term of 3 years, bear interest at a rate of 12% per annum and can be redeemed at the option of the Group or converted into ordinary shares at a fixed price of 9.45 by mutual agreement between the Group and the note holders. As per IAS 32 and IFRS 9, the fair value of the proceeds of the notes consisted of a liability and an equity component. Refer to the Statement of Changes in Equity for the equity portion of this instrument.

On 5 September 2023, the Development Bank of Namibia ("DBN") served notice confirming that all conditions had been fulfilled or waived and that financial close had occurred. Accordingly, the Group received the 1st drawdown of N$50m (c. £2 135 000) in September 2023 and the 2nd drawdown of the same amount in March 2024, totalling an amount of N$100m (c. £4 270 000). These Funds are being used to expedite the implementation of the Uis Mine Stage II Continuous Improvement Programme.

On 22 November 2023, a US$25 000 000 (c. £19 005 000) funding packing was concluded with Orion Resource Partners. This includes US$2 500 000 (c. £1 900 500) equity, a US$10 000 000 (c. £7 600 000) convertible loan note and a US$12.5m (c. £9 500 000) unsecured tin royalty. The equity and loan note will be used to accelerate Andrada's overall strategy of achieving commercial production of its lithium, tin and tantalum revenue streams. The royalty funds will be used for the sole purpose of increasing Andrada's tin production as it ramps up its capital programmes over the next 2 years.

On 6 August 2024, Uis Tin Mining Company agreed a N$100 000 000 (c. £4 270 000) term loan with Bank Windhoek. The loan will have a term of 6 years and will incur interest at the Namibian prime rate plus 1%. Bank Windhoek will provide short-term loan facilities of up to N$15 000 000 (c. £630 000) for use as cash flow against future VAT payments. It is intended that the short-term loan will be provided for 12 months and will incur interest at the Namibian prime rate. The short-term loan will be repaid to the bank upon receipt of refunds from the Namibia Revenue Agency. In addition to the lending facilities, Bank Windhoek will provide Andrada Mining (Namibia) with a N$10 000 000 (c. £427 000) guarantee to the Namibia Power Corporation in relation to a deposit against the right to a supply of electrical power. This guarantee will incur a small fee payable at six-month intervals.

As a result of the new facilities offered by Bank Windhoek, the Group settled the balance of the term loan and the VAT facility owed to Standard Bank Namibia.

OTHER FINANCIAL LIABILITIES

The following is the split between the current and the non-current portion of the liability:

On 22 November 2023, the Group entered into an agreement with Orion Resource Partners (royalty holder) whereby the holder purchased a gross revenue royalty for US$12 500 000 (c. £9 502 625) from the Group. In exchange for the gross revenue royalty, the Group is required to make quarterly royalty payments to the holder based on the tin mined and sold by the Group. At initial recognition, the royalty transaction was measured at fair value of US$12 560 000 (c. £9 548 238). In determining the fair value, management used a credit spread rate of 10.58% and a risk-free rate of 5.54%. As at 31 August 2024, the fair value of the royalty debt was US$13 651 000.

The transaction also included the issue of one hundred (100) unsecured convertible loan notes of $100 000 each. The loan notes are redeemable in 4 years from the issue date. Written consent from the note holders is required in the event that the loan notes are redeemed prior to the maturity date. The interest accrues quarterly at 12% per annum. The noteholders may, at any time before the redemption date, convert the loan notes into Andrada ordinary shares in tranches of a minimum of US$100 000 at a conversion price of 9.45 pence per share. As at 31 August 2024, the derivative liability was measured to £1 411 709. In determining the fair value of the derivative, management used a credit spread of 16.12%.

Trade and other payables

Provision for future environmental rehabilitation and decommissioning costs are made on a progressive basis. Estimates are based on costs that are regularly reviewed and adjusted appropriately for new circumstances. The environmental rehabilitation liability is based on disturbances and the required rehabilitation as at 31 August 2024.

The rehabilitation provision represents the present value of decommissioning costs relating to the dismantling and sale of mechanical equipment and steel structures related to the Phase 1 Plant, the Tantalum Circuit, the Bulk Sample Processing Facility and the demolishing of civil platforms and reshaping of earthworks. A provision for this requires estimates and assumptions to be made around the relevant regulatory framework, the magnitude of the possible disturbance and the timing, extent and costs of the required closure and rehabilitation activities. In calculating the appropriate provision, cost estimates of the future potential cash outflows based on current studies of the expected rehabilitation activities and timing thereof are prepared. These forecasts are then discounted to their present value using a risk-free rate specific to the liability. In determining the amount attributable to the rehabilitation liability, management used a discount rate of 12.31%, an inflation rate of 4.8% and an estimated mining period of 12.1 years. Actual rehabilitation and decommissioning costs will ultimately depend upon future market prices for the necessary rehabilitation works and the timing of when the mine ceases operation.

Lease liability

The Group assessed all rental agreements and concluded that the following rentals fall within the scope of IFRS 16 "Leases" and, therefore, a lease liability has been raised:

The following is the split between the current and the non-current portion of the liability:

DEFERRED CONSIDERATION

On 2 August 2024, the Group acquired an additional 15% interest in the voting shares of its subsidiary, Uis Tin Mining Company, from the Small Miners of Uis ("SMU") and Sinco Investments Five (Pty) Ltd ("Sinco"). This increased the Group's ownership interest from 85% to 100%. The carrying value of the net assets of UTMC on the date of the transaction was £3.86m.

The consideration for the acquisition is made up as follows:

• The issue of Ordinary Shares in Andrada Mining Ltd
• 13 651 560 Ordinary Shares issued to SMU
• 31 148 782 Ordinary Shares issued to Sinco
• 240 monthly cash payments of N$75 000 to be paid by Andrada Namibia to SMU, resulting in a present value of the deferred consideration of £415 640
• Transfer of Andrada Namibia's 85% interest in ML 129 to SMU

£

Authorised: 1 658 895 987 ordinary shares of no par value

Allotted, issued, and fully paid: 1 653 487 606 ordinary shares of no par value

Warrant reserve

The following warrants were granted during the period ended 29 February 2024:

The warrants in issue during the period are as follows:

On 21 July 2023, 15 400 000 warrants were issued as part of the convertible loan note transaction. Each note holder received 2 warrants for every £1 subscribed for. Each warrant enables the holder to subscribe for one ordinary share at a subscription price of 9.45p. The warrants are exercisable at any time from the date of issue for a period of two years.

On 22 November 2023, 16 043 638 warrants were issued as part of the Orion financing transaction. Orion received 2 warrants for every £1 subscribed for. Each warrant enables the holder to subscribe for one ordinary share at a subscription price of 9.45p. The warrants are exercisable at any time from the date of issue for a period of two years.

Share-based payment reserve

Director share options

The following Director share options were granted during the period ended 29 February 2024:

The Director share options in issue during the period are as follows:

The Director share options outstanding at the year end have an average exercise price of £0.069, with a weighted average remaining contractual life of 2.33 years.

The Director must remain as a Director of the Company for the share options to vest. In the event that a Director ceases to be a Director during the vesting period, the Board reserves the right to determine whether the share options will be terminated or not. There are no market-based vesting conditions on the share options.

Employee share options

The following employee share options were granted during the period ended 29 February 2024:

The employee share options in issue during the period are as follows:

The employee share options outstanding at the year end have an average exercise price of £0.081, with a weighted average remaining contractual life of 4.15 years. The employee must remain in employment with the Company for the share options to vest. There are no market-based vesting conditions on the share options.

Events after balance sheet date

Partnership with SQM to develop Namibia lithium asset

On 9 September 2024, the Group entered into a three-stage earn-in agreement to partner with Sociedad Química y Minera de Chile SA, through its subsidiary SQM Australia (Pty) Ltd ("SQM"), in developing the Lithium Ridge asset (ML 133). A new wholly owned subsidiary of Uis Tin Mining Company ("UTMC"), Grace Simba Investments (Pty) Ltd ("GSI"), now holds the Lithium Ridge mining licence. The agreement brings both the financial and technical capabilities required to explore and develop Lithium Ridge. SQM can also earn into GSI by solely funding both the exploration and, in the future, a Definitive Feasibility Study ("DFS") at Lithium Ridge.

The key considerations and milestones in the agreement are:

• SQM agrees to pay Andrada a US$500 000 participation fee on signing and a further US$1.5m upon satisfaction of the conditions precedent (as detailed below)
• SQM has an option to invest US$20m over three-and-a-half years, in different stages, to earn a 40% ownership of GSI
• Subsequent funding of the DFS will enable SQM to attain up to 50% ownership in GSI

A one-off success fee will be payable by SQM should the Group complete a JORC (2012) compliant Mineral Resources Estimation exceeding 40 million tonnes during the third earn-in period. The fee will be calculated based on the percentage of lithium oxide content in the resource. The Group and SQM will create a joint development committee ("JDC") to oversee the development of GSI. The JDC will be constituted with an equal representation of members from SQM and Andrada management. The Group will manage and operate the project during the earn-in period.

The agreement is subject to approval by the Namibian Competition Commission.

• reserves within equity
• Share capital
• Convertible loan note reserve

The convertible loan note reserve represents proceeds on issue of convertible loan notes relating to equity component plus accrued interest on the convertible loan notes.

Warrant reserve

The warrant reserve represents the cumulative charge to date in respect of unexercised share warrants at the balance sheet date.

Share-based payment reserve

The share-based payment reserve represents the cumulative charge to date in respect of unexercised share options at the balance sheet date as well as fees/salaries owed to Directors/employees to be settled through the issuing of shares.

Retained earnings/accumulated deficit

The retained earnings/accumulated deficit represents the cumulative profit and loss net of distribution to owners.