Electra Reports Q3 2023 Results and Provides Update on Battery Material Refinery Project
November 16 2023 - 5:00PM
Business Wire
Electra Battery Materials Corporation (NASDAQ: ELBM; TSX-V:
ELBM) (“Electra” or the “Company”) today reported its financial
results for the three- and nine-month periods ended September 30,
2023, and provided an update on the commissioning of its cobalt
refinery and its black mass recycling trial. All amounts are in
Canadian currency unless otherwise stated.
“Against a backdrop of challenging market and economic
conditions, we completed a number of milestones in Q3, sustaining
the momentum we established over the past 18 months,” said Trent
Mell, Electra’s CEO. “Most notably, we closed an equity financing
that generated gross proceeds of $21.5 million, extended our supply
agreement with LG Energy Solution to five years from three, and
signed an MOU with Three Fires to form a joint venture focused on
battery waste recycling in Canada.
“Backed by a stronger balance sheet, our near-term focus will be
to complete our black mass recycling trial at our refinery complex
and accelerate efforts to secure the US$60 million in funding
required to complete our refinery project. Once completed, the
estimated replacement value of the cobalt refinery will be
approximately US$260 million. An integrated facility will allow
Electra to make MHP from battery scrap, then upgrade the cobalt to
a battery-grade sulfate for LG Energy Solutions and other battery
manufacturers.”
Mr. Mell concluded, “Over the longer term, we remain committed
to advancing plans for a second refinery in Bécancour, Quebec and
advancing our exploration projects in the Idaho Cobalt Belt.”
ELECTRA Q3 2023 HIGHLIGHTS AND DEVELOPMENTS
- Closed concurrent brokered and non-brokered private placements
for aggregate gross proceeds of $21.5 million. Under the terms of
the equity financings, the Company issued 19,545,454 units in
aggregate, at a price of $1.10 per unit with each unit consisting
of one common share and one common share purchase warrant. Each
warrant entitles the holder to purchase one common share at a price
of $1.74 at any time on or before August 11, 2025. Electra intends
to use the net proceeds of the equity financing to advance its
black mass recycling strategy, its cobalt refinery, for working
capital to retire existing payables, and general corporate
purposes.
- Held cash and marketable securities of $15.7 million as at
September 30, 2023, up from $7.4 million as at June 30, 2023. The
increase was driven by the equity financing completed in August
that generated gross proceeds of $21.5 million, but offset by
capital costs related to the construction of the cobalt refinery
project and costs related to the Company’s black mass trial.
Electra’s cash balance at the end of Q3 2023 does not include the
remaining $5.1 million of government investments expected to be
received.
- Net loss for the quarter was $9.2 million or $0.20 per share.
The net loss was driven by $4.4 million of fair value adjustments
relating to the Company’s 2028 convertible notes.
- Operating loss for Q3 2023 was $4.2 million, down from $4.8
million for Q3 2022. The decline was primarily driven by lower
exploration costs for Iron Creek, Electra’s exploration assets in
Idaho.
- Progressed with the first plant-scale recycling of black mass
material in North America using Electra’s proprietary
hydrometallurgical process. Progress in Q3 was marked by recoveries
of critical metals, including lithium, nickel, cobalt, copper,
manganese, and graphite, needed for the EV battery supply chain,
and the production of high-quality nickel-cobalt mixed hydroxide,
graphite, and lithium carbonate products.
- Made the first customer shipment of nickel-cobalt mixed
hydroxide precipitate (MHP) produced at the Company’s refinery
complex north of Toronto from recycled battery material. To date,
Electra has shipped approximately 20 tonnes of nickel-cobalt MHP to
customers.
- Extended and expanded the terms of its battery-grade cobalt
supply agreement with LG Energy Solution whereby Electra will now
supply up to 19,000 tonnes of contained cobalt in sulfate over a
five-year period beginning in 2025, up from 7,000 tonnes over a
three-year period when the supply agreement was first announced in
September 2022.
- Announced a change in auditors from KPMG LLP to MNP, LLP
Chartered Professional Accountants effective September 18, 2023. At
Electra’s request, KPMG resigned as auditors. KPMG did not issue
any modified opinions on the financial statements of the
Corporation for the two fiscal years preceding the resignation nor
for any interim financial information preceding the date of its
resignation.
- Announced receipt of a notice from The Nasdaq Stock Market LLC
(“Nasdaq”) stating that the Company is not in compliance with the
minimum bid price requirement of US$1.00 per share under Nasdaq’s
Listing Rule 5550(a)(2) based upon the closing bid price of the
Company's common shares for the 30 consecutive business days prior
to the date of the Notice, September 21, 2023. The Company has 180
calendar days from the date of the Notice, or until March 19, 2024,
to regain compliance with the Minimum Bid Requirement, during which
time the Company’s common shares will continue to trade on
Nasdaq.
HIGHLIGHTS SUBSEQUENT TO QUARTER END
- Extended the processing of black mass material at its refinery
complex based on the successes of its battery recycling trial,
which have included improved recoveries of high-value elements,
higher metal content in saleable products produced, and reduced use
of reagents. Additional MHP product deliveries to customers are
expected in Q4.
- Received US$5 million in long-lead, critical equipment,
including pressure vessels, tanks, and structural steel, needed for
completion of the Company’s cobalt sulfate refinery. Installation
of the equipment delivered at site will occur as Electra secures
capital funding requirements for its refinery project.
For complete details of the consolidated financial statements
and the associated management’s discussion and analysis, please
refer to the Company’s filing on SEDAR+ (www.sedarplus.ca) or the
Company’s website (www.ElectraBMC.com).
Electra will host a conference call on November 17, 2023 at
10:00 am ET to review its third quarter performance and discuss
near-term outlook.
Dial-in and Webcast Details:
- North American dial-in number: 1
800-319-4610 - International dial-in number: 1 416 915-3239 -
Webcast and slide presentation:
https://ElectraBMC.com/category/events/
Corporate Matters
In accordance with its long-term incentive plan, the Company has
granted $52,500 in Deferred Share Units to the independent
directors of the Company for second and third quarter directors
fees taken in DSUs in lieu of cash. The DSUs will be granted and
priced two trading days from today on the closing price of the
Company’s common shares on the TSX Venture Exchange. The DSUs may
not be exercised until a director or officer ceases to serve the
Company and will vest in one year from the grant date.
About Electra Battery Materials
Electra is a processor of low-carbon, ethically-sourced battery
materials. Currently constructing North America’s only cobalt
sulfate refinery, Electra is executing a multipronged strategy
focused on onshoring the electric vehicle supply chain. Keys to its
strategy are integrating black mass recycling and nickel sulfate
production at Electra’s refinery located north of Toronto,
advancing Iron Creek, its cobalt-copper exploration-stage project
in the Idaho Cobalt Belt, and expanding cobalt sulfate processing
into Bécancour, Quebec. For more information visit
www.ElectraBMC.com.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
Cautionary Note Regarding Forward-Looking Statements
This news release may contain forward-looking statements and
forward-looking information (together, “forward-looking
statements”) within the meaning of applicable securities laws and
the United States Private Securities Litigation Reform Act of 1995.
All statements, other than statements of historical facts, are
forward-looking statements. Generally, forward-looking statements
can be identified by the use of terminology such as “plans”,
“expects”, “estimates”, “intends”, “anticipates”, “believes” or
variations of such words, or statements that certain actions,
events or results “may”, “could”, “would”, “might”, “occur” or “be
achieved”. Forward-looking statements are based on certain
assumptions, and involve risks, uncertainties and other factors
that could cause actual results, performance, and opportunities to
differ materially from those implied by such forward-looking
statements. Among the bases for assumptions with respect to the
potential for additional government funding are discussions and
indications of support from government actors based on certain
milestones being achieved. Factors that could cause actual results
to differ materially from these forward-looking statements are set
forth in the management discussion and analysis and other
disclosures of risk factors for Electra Battery Materials
Corporation, filed on SEDAR+ at www.sedarplus.ca and with on EDGAR
at www.sec.gov. Other factors that could actually results to differ
materially include changes with respect to government or investor
expectations or actions as compared to communicated intentions, and
general macroeconomic and other trends that can affect levels of
government or private investment. Although the Company believes
that the information and assumptions used in preparing the
forward-looking statements are reasonable, undue reliance should
not be placed on these statements, which only apply as of the date
of this news release, and no assurance can be given that such
events will occur in the disclosed times frames or at all. Except
where required by applicable law, the Company disclaims any
intention or obligation to update or revise any forward-looking
statement, whether as a result of new information, future events or
otherwise.
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version on businesswire.com: https://www.businesswire.com/news/home/20231116229044/en/
Joe Racanelli Vice President, Investor Relations
info@ElectraBMC.com 1.416.900.3891
Electra Battery Materials (NASDAQ:ELBM)
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