Ann: Letter to Shareholders - Priority Offer, page-6

*Delta Lithium Limited (ASX: DLI) presents a compelling long-term investment opportunity, particularly for those interested in the critical minerals sector. Here's an overview of its prospects:

Strategic Lithium Projects

• Mt Ida Project: Located in Western Australia, Mt Ida boasts a JORC-compliant lithium resource of 14.6 million tonnes at 1.2% Li₂O and 191 ppm Ta₂O₅. The project has received approval to commence open-pit mining operations, positioning it as a near-term production asset.**promotion blocked**

• Yinnetharra Project: In the Upper Gascoyne region, Yinnetharra has an updated Mineral Resource Estimate of 21.9 million tonnes at 1.0% Li₂O and 75 ppm Ta₂O₅, highlighting its potential as a significant lithium source. The Yinnetharra Project is advancing methodically through its development stages. While mining has not yet begun, the project's growing resource base, positive metallurgical results, and ongoing feasibility and permitting activities indicate a clear trajectory toward future production.**promotion blocked**

Financial Outlook

• Breakeven Projections: Analysts anticipate Delta Lithium to reach breakeven by 2026, with expected positive profits of approximately AU$25 million. This projection suggests a cautious yet positive growth trajectory.finance.yahoo.com

• Debt Position: The company operates with no debt on its balance sheet, relying solely on shareholder funding. This debt-free status reduces financial risk and provides flexibility in capital allocation.finance.yahoo.com

Analyst Sentiment

• Price Targets: Analyst consensus indicates a 12-month price target averaging AU$0.423, with estimates ranging from AU$0.17 to AU$0.75. This suggests a potential upside from current trading levels.au.investing.com

• Speculative Buy Rating: Bell Potter has reiterated a speculative buy rating on Delta Lithium, citing the company's strategic projects and potential for significant returns.**promotion blocked**.au+1**promotion blocked**.au+1

Management and Strategic Moves

• Experienced Leadership: Managing Director James Croser brings over 30 years of experience in Western Australian mining operations, providing seasoned leadership to the company's initiatives.**promotion blocked**

• Demerger of Gold Assets: Delta Lithium is spinning off its gold assets into a new entity, Ballard Mining Limited, allowing the company to focus exclusively on its lithium projects. This strategic move could unlock additional value for shareholders.

Risks to Consider

• Commodity Price Volatility: Lithium prices have experienced significant fluctuations, with an 80% drop in 2023 alone. Such volatility can impact revenue and project viability.**promotion blocked**.au

• Development Stage: As an exploration and development company, Delta Lithium faces inherent risks associated with project execution, regulatory approvals, and potential delays.

Conclusion

Delta Lithium's focus on high-quality lithium projects in a mining-friendly jurisdiction, combined with a strong financial position and experienced management, positions it well for long-term growth. While there are risks typical of early-stage mining companies, the strategic initiatives and market demand for lithium present a promising outlook for patient investors.

*gpt4o