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Livium Ltd (ASX: LIT) ("Livium" or the "Company") wishes to provide a strategic update in response to progress that had been made to shift our various technologies to important inflection points for growth. Livium’s strategy is now focussed on strategic partnering initiatives which will facilitate the ongoing growth and development of the Company’s technologies. With a more focussed set of actions, a review of the business has been undertaken to explore options to reduce costs.
HIGHLIGHTS
- Strategic focus on scaling Envirostream, the Battery Recycling division, due to the potential of increased recycling volumes and cashflows over the years ahead
- Battery Recycling: Continued safe operations, growing volumes and operating profits, and seek partners to scale operations in line with the expected waste outlook
- Livium is well advanced on the near-term commercialisation pathways of its other technologies:
- Battery Materials: Defined pathway for development of an Australian LFP demonstration plant with funding to be secured directly into VSPC from strategic partners
- Lithium Chemicals: Complete JDA activities with MinRes, including assessment of alternate commercialisation pathways and selection of the preferred lithium product
- Restructuring of the organisation and cost reductions being undertaken with estimated annual ongoing savings of A$1.5m
Comment regarding the strategic update from Livium CEO and Managing Director, Simon Linge
"We have advanced our strategy to inflection points, with the next phases of growth for each division requiring strategic partners to underpin their growth and development. With a focus on strategic growth partners, we have reviewed our resourcing and made the decision to restructure our organisation and reduce costs.
Livium remains committed to delivering returns for shareholders. Whilst organisational changes may impact our ability to react to opportunities, right sizing the organisation assists in resetting the Company's cost base to become sustainable over this critical period."
NEAR TERM PLANS
The following activities have been identified as key to delivering value in the near term:
- Battery Recycling: Continued safe operations, growing end-of-life volumes, and seeking partners to scale operations in line with the expected waste outlook and to expand into related services
- Battery Materials: Secure funding for an Australian LFP demonstration plant from government and private strategic partners, who will invest directly into VSPC
- Lithium Chemicals: Complete JDA activities with MinRes, including assessment of alternate commercialisation pathways and selection of the preferred lithium product
- Corporate: Complete implementation of organisation restructure and other cost saving initiatives.
BATTERY RECYCLING GROWTH OUTLOOK
The Battery Recycling division generates revenue today, is the largest recycler of lithium-ion batteries in the country, draws on our technical expertise to provide value-added services and has strong commercial relationships. Strategic focus is being placed on Battery Recycling, through Envirostream, due to the potential of increased recycling volumes over the coming years.
During CY2024, Envirostream successfully increased volumes of EV' andESS2 with most of the volume being received under exclusive customer arrangements. Over CY2024, Envirostream collected 736k tonnes of large format batteries and it is estimated that there are five times these volumes available today which are increasingly expected to be recycled due to consumer demand and government regulation. In their Battery Market Analysis, B-cycle show how EV and ESS batteries are expected to dominate3.
Figure 1. EOL Battery Projections by Market Segment3
Focusing on only EV / ESS for the balance of the decade demonstrates the near-term opportunity for Envirostream collections growth relative to current performance.
Figure 2. 5-Year EV and ESS EOL Battery Projections3
The near-term outlook for Envirostream is positive, enabling increases of volumes collected and processed, and providing an opportunity to expand our service offerings in line with market requirements.
To accommodate expectations of market growth, the business intends to explore deploying growth capital to improve operating efficiencies and expand capacity. The company has appointed advisors to coordinate discussions around partnership and growth funding options, which includes both strategic partners and other financiers.
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This article includes content from Livium Ltd, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
Lithium Australia
Overview
Electric vehicle (EV) production is ramping up worldwide. According to the International Energy Agency, the global stock of EVs could reach 245 million units by 2030. Importantly, the EV industry is being touted as critical to the rapidly emerging green economy.
However, the environmental sustainability of the EV industry is not as clear-cut as many believe. In fact, its growth has generated many questions about how end-of-life lithium-ion batteries can be managed in ways consistent with the ethos of the green economy. Given that the volume of spent batteries from EVs and battery energy storage systems will grow sharply over the next decade, the matter is of real concern – it is predicted that the number of end-of-life lithium-ion batteries will exceed that of lead-acid batteries beyond 2040.
Currently in Australia, less than 10 percent of end-of-life lithium-ion batteries are made available for recycling. This has prompted the establishment of a battery stewardship initiative, which provides a strong financial incentive to recycle most types of spent batteries. The initiative, which is set to take effect in early 2022, encourages responsible battery management ... from design right through to end of life. Thus, Australian companies embracing environmentally sustainable lithium-ion battery supply and recycling present investors with an intriguing opportunity as they seek to leverage such financial incentives.
Lithium Australia NL (ASX: LIT) is a diversified battery materials company with strong ESG values. Led by an accomplished management team with decades of experience in the mining, mineral processing and chemical manufacturing industries, the company is committed to developing a sustainable circular economy for battery materials.
An investment in Lithium Australia provides exposure to the exponential growth of the lithium-ion battery industry worldwide and a geographic footprint with the potential to span several countries – Australia, China, the United States, India and the United Kingdom among them. The company has established an ethical, sustainable framework for lithium extraction, processing and recycling that encompasses joint-venture projects, strategic investments and a suite of proprietary technologies – underpinned by intellectual property (IP), including international patents – that creates a sustainable model for battery production.
According to company managing director Adrian Griffin, “Lithium Australia is the only ASX-listed company with a sustainable model for battery materials.”
Lithium Australia has four lithium-battery related business divisions: raw materials, lithium chemicals, batteries and recycling. These can be summarised as follows.
With respect to raw materials, the company has progressively farmed out its exploration portfolio. In so doing, it has accumulated equity interests in the public companies now managing the projects. This reduces costs and enhances accessibility to lithium feedstock while providing shareholder value through potential economic returns.
Lithium Australia's lithium chemicals division has developed proprietary, energy-efficient technologies for the extraction of lithium from what is generally considered waste material by the mining industry. Foremost is LieNA®, a process that greatly improves the rate of recovery of lithium from spodumene. SiLeach®, meanwhile, recovers lithium from mine waste (specifically micas) and clays. Both technologies produce primary battery chemicals (lithium phosphate in particular) and are patented in Australia and internationally. The federal government has awarded Lithium Australia a grant to further develop its LieNA® process, and construction of a LieNA® pilot plant is underway.
The company's 100 percent owned subsidiary VSPC Ltd (VSPC) is a developer of advanced materials for lithium-ion batteries. VSPC, which has spent 20 years researching its proprietary, internationally patented nanotechnology, produces next-generation battery materials, including lithium ferro phosphate (LFP) and lithium manganese ferro phosphate (LMFP) cathode powders. VSPC's technology can harness lithium phosphate (produced by both LieNA® and SiLeach®) as a cathode powder precursor and thus has the potential to reduce the number of process steps required to convert lithium chemicals recovered from mine waste and spent batteries to materials for use in new lithium-ion batteries.
Lithium Australia's 90 percent owned recycling subsidiary Envirostream Australia Pty Ltd (Envirostream) is Australia's only authorised mixed-battery recycler and, as such, is well-positioned for the imminent roll-out of the national Battery Stewardship Scheme. Having established an Australia-wide collection network for mixed spent batteries (including at Bunnings stores in Australia and New Zealand) for recycling, Envirostream uses proprietary technology to extract higher yields (95 percent) from end-of-life lithium-ion batteries than any of its global competitors.
(For further details of each Lithium Australia business division, refer to 'Key assets' below.)
Company Highlights
- Lithium Australia’s strategic investments in ASX-listed companies and its free-carried exploration interests provide exploration upside and low-risk exposure to raw materials for the battery industry.
- The company’s patented lithium extraction technologies reduce the length of the supply chain from mining of raw materials through battery production to, ultimately, recycling.
- Lithium Australia is one of the few companies outside China that provides direct exposure to the burgeoning LFP industry – and the only investment exposure to LFP on the ASX. Increased global demand for LFP-type lithium-ion batteries (particularly for EVs and battery energy storage systems), lack of LFP production in the West and strong domestic consumption of LFP within China are placing immense pressure on the availability of this battery material worldwide.
- Lithium Australia is also one of the few companies worldwide to master the production of next-generation, higher-energy-output LMFP cathode material.
- As the only licensed mixed-battery recycler in Australia, company subsidiary Envirostream stands to benefit from the imminent Australia-wide battery stewardship scheme, particularly in light of its recent battery-collection agreement with Bunnings.
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