Livium Cuts Losses but Faces Funding Hurdles for Lithium Tech and Battery Plant

A Turning Point for Battery Recycling

Livium Ltd, formerly Lithium Australia, has marked a significant milestone in its FY25 results with its battery recycling division, Envirostream, posting its first-ever profit before tax of $2.4 million. This achievement comes on the back of a modest 3% revenue increase to $6.9 million and a remarkable 91% jump in gross profit to $4.2 million, lifting the gross margin to 61% from 33% the previous year. The shift to a fee-for-service model and a strategic focus on large-format lithium-ion batteries, such as those used in electric vehicles and energy storage, have been key drivers behind this turnaround.

However, the transition has not been without challenges. Envirostream experienced a 40% drop in overall collection volumes, largely due to an 85% decline in smaller, non-core battery chemistries. This was offset by a 30% increase in large-format lithium-ion battery collections, which carry significantly higher margins. The company has also secured new recycling agreements with major industry players including BYD, ZECO Energy, and Wabtec, positioning Envirostream to capitalize on the anticipated sixfold growth in end-of-life lithium-ion batteries by 2030.

Progress on Lithium Extraction and Battery Materials

Beyond recycling, Livium has advanced its patented lithium extraction technology, LieNA®, through a newly formed 50 – 50 joint venture with Mineral Resources Ltd. This JV, LieNA Pty Ltd, now wholly owns the technology and aims to license it to third parties with a target royalty rate of 8%. While current market conditions have delayed the construction of a semi-commercial demonstration plant, the JV is exploring alternative commercialisation pathways and remains poised to benefit from the growing demand for lithium products.

In parallel, Livium’s battery materials subsidiary, VSPC, achieved a technical breakthrough with high-density lithium ferro phosphate (LFP) cathode materials, enhancing its appeal to electric vehicle manufacturers. The company has chosen Australia as the site for its demonstration plant and secured a binding $30 million grant from the Australian Renewable Energy Agency (ARENA). This funding, contingent on matching investments, will support front-end engineering and design, and potentially the plant’s construction, marking a critical step toward commercial-scale production.

Corporate Restructuring and Financial Health

Livium has also undergone significant corporate restructuring, reducing its workforce by 26% to focus on core activities and achieve annual cost savings of approximately $1.8 million. The company raised capital through placements and a share purchase plan, and divested non-core assets including its stake in the Bynoe Lithium Project and shares in Charger Metals and Evion Group, bolstering its balance sheet.

Despite a net loss after tax of $4.6 million for FY25, this represents a substantial improvement from the $10.8 million loss in FY24. The reduction was aided by a $2.1 million provision release related to a 2019 fire at Envirostream’s premises and recognition of a $1.6 million deferred tax asset. Livium ended the year with $3.8 million in cash and investments, and a working capital deficit of $6.2 million, which includes a $5.4 million remediation provision expected to be covered by insurance.

Looking Ahead

Looking forward, Livium is focused on expanding Envirostream’s market penetration, particularly in commercial e-mobility and energy storage sectors, while advancing the LieNA® JV and securing funding for the VSPC demonstration plant. The company is also exploring additional recycling technologies and preparing for scaled operations with a national hub-and-spoke model to improve capacity and reduce costs.

Livium’s strategic pivot from mining to critical battery materials and recycling, underscored by its recent name change, reflects a commitment to sustainability and circular economy principles. The coming year will be pivotal as the company seeks to translate technological advancements and strategic partnerships into commercial success.