Li-S Energy has marked a milestone with the production of Australia’s first lithium metal foils and expanded its footprint in the global defense sector, supported by new manufacturing capabilities and strategic partnerships.
- Successful manufacture of Australia’s first lithium metal foils ahead of schedule
- Completion and commissioning of advanced cathode coater and clean-room facility
- Progress on Pegasus UAV battery modules with flight tests planned for early 2026
- Formal AUKUS export approval enhances international defense collaboration
- Appointment of Paladin Defense Services to accelerate US defense market access
Manufacturing Breakthrough – Lithium Metal Foils
Li-S Energy has achieved a significant technical milestone by successfully manufacturing Australia’s first lithium metal foils at its Geelong facility. This development, delivered ahead of schedule and supported by a $1.78 million Australian Government Industry Growth Program grant, establishes a sovereign manufacturing capability that not only secures a critical supply chain component for Li-S’s lithium sulfur and lithium metal batteries but also opens new revenue streams in international markets.
The company has further enhanced this production line with advanced rolling, laminating, and coating systems capable of producing ultra-thin foils down to 20 microns, positioning Li-S Energy at the forefront of battery material innovation.
Scaling Up – Cathode Coater and Clean Room Commissioning
Complementing its lithium foil production, Li-S Energy completed commissioning of a high-precision cathode coater housed within a dedicated clean-room environment. This equipment integrates in-line metrology tools that ensure precise control over cathode weight, thickness, and porosity, critical factors for optimizing battery performance. The coater is now fully operational and forms a core part of the company’s cathode manufacturing process, enabling scale-up to meet anticipated demand.
Advancing Defense Applications – Pegasus UAV Program and AUKUS Approval
Li-S Energy continues to make strides in defense-related applications through its involvement in the Pegasus UAV program, developing battery modules designed for long-endurance drones. Several modules have been built and are undergoing rigorous performance and safety testing, with integration into the UAV platform and flight tests slated for early 2026.
In August, the company secured formal export approval under the AUKUS framework, streamlining the export of its high energy density battery cells to partner nations Australia, the US, and the UK. This approval is a strategic enabler for deeper collaboration and market access within the allied defense community.
Expanding Global Defense Footprint
Li-S Energy has bolstered its presence in the US defense sector by appointing Paladin Defense Services LLC as its specialist representative. Paladin’s status as a US government acquisition entity facilitates access to sole-source contracts up to US$7.5 million, accelerating Li-S Energy’s pathway to funded trials and procurement opportunities. The company’s active participation in major defense conferences in London and Washington DC, supported by Austrade, underscores its commitment to global market engagement.
Financial Position and Governance
Financially, Li-S Energy reported net operating cash outflows of $1.757 million for the quarter, primarily driven by staff costs and administration expenses, partially offset by government grants and investment proceeds. The company ended the quarter with a healthy cash balance of $13.15 million, providing a solid runway for ongoing development and commercialization efforts.
Governance updates include the appointment of Andrew Davies as Chief Financial Officer, bringing nearly two decades of relevant industry experience, and the announcement of the 2025 Annual General Meeting scheduled for November 18, 2025.
Bottom Line?
Li-S Energy’s manufacturing advances and strategic defense partnerships set the stage for accelerated growth and market penetration in 2026.
Questions in the middle?
- How quickly can Li-S Energy scale lithium foil production to meet global demand?
- What are the prospects for securing funded contracts through Paladin Defense Services in the US?
- How will AUKUS export approval translate into tangible commercial opportunities?