Announcement PDF LIVIUM LTD ACN 126 129 413 Annual Report For the Year Ended 30 June 2025 Livium Ltd ACN 126 129 413 +61 (0) 3 7017 2656 info@lithium-au.com liviumcorp.com Annual Report For the Year Ended 30 June 2025 Table of Contents Table of Contents Corporate Directory ...................................................................................................................... 1 Chair’s Letter................................................................................................................................. 2 Dear Shareholders, ....................................................................................................................... 2 Directors’ Report ........................................................................................................................... 4 1 Director’s Report ................................................................................................................................... 4 2 Review of Operations ............................................................................................................................ 9 3 Remuneration report (audited) ........................................................................................................... 18 4 Governance .......................................................................................................................................... 23 Auditor’s Independence Declaration ......................................................................................... 25 Consolidated Statement of Comprehensive Income for the Year Ended 30 June 2025 ......... 26 Consolidated Statement of Financial Position for the Year Ended 30 June 2025................... 27 Consolidated Statement of Changes in Equity for the Year Ended 30 June 2025 .................. 28 Consolidated Statement of Cash Flows for the Year Ended 30 June 2025 ............................. 30 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2025 .............. 31 Note 1 Statement of material accounting policies ..................................................................... 31 Note 2 Revenue .............................................................................................................................. 39 Note 3 Other income ..................................................................................................................... 39 Note 4 Finance costs ..................................................................................................................... 40 Note 5 Auditor’s remuneration ..................................................................................................... 40 Note 6 Expenses from ordinary activities ................................................................................... 40 Note 7 Income tax expense .......................................................................................................... 41 Note 8 Trade and other receivables ............................................................................................. 42 Note 9 Inventory ............................................................................................................................ 42 Note 10 Financial assets ................................................................................................................. 42 Note 11 Intangible assets ............................................................................................................... 43 Note 12 Property, plant and equipment ......................................................................................... 44 Note 13 Trade and other payables ................................................................................................. 45 Note 14 Leases ................................................................................................................................ 45 Note 15 Provisions .......................................................................................................................... 46 Note 16 Loans and borrowings ...................................................................................................... 46 Note 17 Deferred tax assets ........................................................................................................... 47 Note 18 Capital management ......................................................................................................... 47 Note 19 Issued capital ..................................................................................................................... 47 Note 20 Reserves ............................................................................................................................. 48 Note 21 Financial instruments ....................................................................................................... 49 Note 22 Loss per share ................................................................................................................... 50 Note 23 Cash flow ............................................................................................................................ 51 Livium Ltd Page i Annual Report For the Year Ended 30 June 2025 Table of Contents Note 24 Operating segments .......................................................................................................... 51 Note 25 Contingent liabilities ......................................................................................................... 54 Note 26 Related party transactions ............................................................................................... 54 Note 27 Controlled entities ............................................................................................................. 55 Note 28 Consolidated entity disclosure ........................................................................................ 55 Note 29 Parent entity ....................................................................................................................... 56 Note 30 Commitments ..................................................................................................................... 56 Note 31 Share based payments ..................................................................................................... 57 Note 32 Subsequent events............................................................................................................ 61 Directors’ Declaration ................................................................................................................. 62 Independent Auditor’s Report .................................................................................................... 63 Additional ASX Information ........................................................................................................ 69 5 Additional ASX Information ................................................................................................................ 69 Livium Ltd Page ii Annual Report For the Year Ended 30 June 2025 Corporate Directory Corporate Directory Livium Ltd Corporate Directory Directors Managing Director and CEO: Simon Linge Non-Executive Chair: Phillip Campbell Non-Executive Directors: Kristie Young Phil Thick Executive Management Chief Financial Officer: Stuart Tarrant Joint-Company Secretary: Catherine Grant-Edwards Melissa Chapman Business Details Registered Office: Suite 1, 79 - 83 High Street, Kew VIC 3101 Principal Place of Business: Suite 1, 79 - 83 High Street, Kew VIC 3101 Phone: +61 (0) 3 7017 2656 Email: info@liviumcorp.com Website: www.liviumcorp.com Stock Exchange Listing: Livium Ltd securities are listed on Australian Securities Exchange (ASX Codes: LIT, LITOA, LITOB) Other Details Bank: National Australia Bank, 100 St Georges Terrace, Perth WA 6000 Auditors: Hall Chadwick WA Audit Pty Ltd (Hall Chadwick), 283 Rokeby Road, Subiaco WA 6008 Share Registry: Automic Group on 1300 429 179 (domestic calls) or +61 2 7208 4522 (international calls) or by email at corporate.actions@automicgroup.com.au Livium Ltd Page 1 Annual Report For the Year Ended 30 June 2025 Chair’s Letter Chair’s Letter Dear Shareholders, It is my privilege to present Livium’s FY25 Annual Report, marking my first as Chair since joining the company in April 2025. When making the decision to join Livium I spent considerable time getting to know the company to fully understand its operations, challenges and prospects. While amidst a challenging strategic environment and operating in a sector that has faced a number of headwinds, I found that the business has underlying unmet potential, and a capable, committed team. Under the stewardship of Managing Director and CEO, Simon Linge, the company had undertaken a root and branch strategic review in calendar 2024 resulting in a realignment of the business to better position it for growth in the medium to long term. The name change was part of the signalling of that repositioning. Through this process, the company had made meaningful progress in sharpening its focus and building greater operational discipline. The strategic review confirmed recycling, and more particularly, battery recycling as Livium’s core priority and best platform for medium term growth, particularly as global demand for sustainable materials continues to rise. In response, the board and management had adopted a clear direction - to scale recycling volumes and build the capability and capacity required to maintain Livium’s position as Australia’s leading lithium-ion battery recycler. What stood out for me during my due diligence was the resilience, versatility, and adaptability shown across the organisation, coupled with strong collaboration between the board and management. Our battery recycling operations have shown encouraging progress. Over FY25, Envirostream achieved a maiden net profit of A$0.3 million. While this does not mean all challenges have been overcome, it demonstrates that the refocused business is beginning to deliver tangible results. Demand for recycled materials, particularly lithium-ion batteries, is increasing as manufacturers focus on securing sustainable supply chains and meeting their ESG obligations. We are building on this momentum to grow volumes and strengthen partnerships that underpin our commercial model. The strategic review also highlighted nascent adjacent recycling opportunities, including rare earth element (REE) recycling driven by geopolitical shifts such as China’s restrictions on exports and new legislation in the US. We are actively assessing developments in REE recycling technologies that could provide pathways for Livium to diversify and grow. Our proprietary technologies, LieNA® and VSPC continue to hold medium to long term value especially in the right economic and national security environments. While these opportunities are potentially significant, it is important that we balance the capital required to realise a return on our investment in a period of investment into recycling. It is clear that the method for the funding of these opportunities is via partnerships; partnerships that minimize shareholder dilution. Through the LieNA® partnership, MinRes has funded the past two years of activities. These activities have now successfully been completed, and we are pleased that the 50/50 joint venture with MinRes has recently been established. For VSPC, significant progress was made with $30 million in conditional grant funding secured from ARENA. We continue to work with possible funding partners for the remaining funding gap and will decide quickly which, if any, could realise a return for shareholders. Considering our national security environment and looking ahead strategically, recent global developments have highlighted both the opportunities and the urgent need for a strong domestic battery industry. Not to deflect attention away from the national drive to manufacture solar panels onshore, it should be obvious that batteries have an increasing significance for the net zero transition. Recycling and VSPC technology for battery manufacture are therefore of strategic national importance. Progress is being made, albeit slowly, from a national recycling perspective. The passage of battery recycling legislation in NSW late last year was a good start. It is now critical that the federal government ensure aligned adoption across all other states to establish a consistent, nationwide framework. Improper disposal of batteries and battery-powered products continues to pose a growing safety and environmental risk, with more than 10,000 fires reported each year across the waste and resource recovery industry. These incidents threaten workers, damage equipment, disrupt essential services and undermine public trust in electrification efforts. This risk is compounded by the lack of dedicated infrastructure to collect, process, and remanufacture batteries, with only three out of every 20 handheld batteries currently recovered. Livium Ltd Page 2 Annual Report For the Year Ended 30 June 2025 Other major global economies, including Europe and India, have demonstrated that these challenges are solvable. Battery recovery there is increasingly linked to national security objectives and supported by robust domestic recycling frameworks. Australia must act quickly to ensure it is not left behind. We remain extremely grateful for the support provided by ARENA and the broader government, which has enabled progress on VSPC technology. It needs to be employed in the service of the nation rather than languishing for lack of capital investment. Both Australian and international capital is required. We therefore respectfully call on policymakers to create an investment climate conducive to the manufacturing of batteries in Australia. Australia has the expertise and resources to meet this challenge, but immediate decisive and collaborative action led by government is paramount. Livium has the opportunity to participate in and benefit from the accelerating global transition to electrification and decarbonisation. Our focus remains on improving revenue from recycling. Achieving that growth involves the disciplined evaluation of improved battery collection methods, including interstate collection hubs, and joint ventures with likeminded recyclers of materials key to the net zero energy transition. At the same time we are mindful to preserve the value inherent in LieNA® and VSPC technologies at minimal cost until commercialisation opportunities mature. Growing shareholder value over the long term is a top of mind for the Board and the Executive. Phillip Campbell Non-executive Chair Livium Ltd Page 3 Annual Report For the Year Ended 30 June 2025 Directors’ Report Directors’ Report The Directors present their report on Livium Ltd (“LIT” or the “Group”) and its controlled entities (the “Group”) for the year ended 30 June 2025 (the “year”). 1 Director’s Report 1.1 Board of Directors The names and details of the Group’s directors in office during the year and until the date of this report are as follows. Directors were in office for this entire period unless otherwise stated. Board of Directors Managing Director and CEO: Simon Linge Non-Executive Chair: Phillip Campbell (appointed on 1 April 2025) George Bauk (resigned on 3 January 2025) Non-Executive Director: Kristie Young Phil Thick (appointed as Interim Non-Executive Chair from 3 January 2025 to 31 March 2025) 1.2 Information on Directors Information on Directors Managing Director and CEO Name: Simon Linge Experience: Mr Linge has over 30 years’ experience in manufacturing, logistics and infrastructure. Mr Linge has held multiple senior leadership positions. This included an executive role at Pact Group, a leader in the circular economy focused on minimising waste through packaging, reuse, and recycling solutions. He also served as Managing Director & CEO of Bradken Limited, a global manufacturer of designed alloyed steel components, with a primary focus on the mining sector. Prior to these roles, Mr Linge also held senior executive positions with BlueScope throughout Australia, Asia, New Zealand, and USA. Mr Linge is the President of Association for the Battery Recycling Industry (ABRI). Qualifications: BEco (Hons), MAICD Other directorships in listed entities held in the past three years: None Non-Executive Chair Name: Phillip Campbell Experience: Phillip is an experienced independent non-executive director on publicly listed and private company boards. He has executive experience (MD/CEO roles) in a range of national manufacturing and engineering businesses and has significant experience in expanding and developing businesses. Phillip has a Bachelor of Electrical and Electronics Engineering from the University of Queensland and is a graduate member of the Australian Institute of Company Directors (GAICD). Corporate governance committee roles: • • Member of the Audit & Risk Committee Member of the Remuneration & Nominations Committee Other directorships in listed entities held in the past three years: • Non-Executive Chairperson - Verbrec Limited (ASX:VBC) Livium Ltd Qualifications: BEng (Hons), GAICD Page 4 Annual Report For the Year Ended 30 June 2025 Directors’ Report Information on Directors Non-Executive Director Name: Experience: Corporate governance committee roles: Other directorships in listed entities held in the past three years: Kristie Young BEng (Hons) Mining, Post Grad Dip (Education), FAICD, FAusIMM Ms Young has over 25 years’ experience in industry with a focus on the resources sector, coupled with over 15 years' experience on boards and committees. Experience spans across technical mining engineering, project evaluation, strategy, growth, marketing, commercial, client management, governance, executive search and business development (BD) including BD Director roles with both EY and PwC. Ms Young is Non-Executive Director with MinEx CRC and four ASX listed entities. She holds a BEng(Mining)Hons, Post Grad DipEd (Maths, IT), Cert IV(HR), is a Graduate and Fellow of the AICD and a Fellow of the AusIMM. • Chair of the Audit & Risk Committee • Member of the Remuneration & Nominations Committee • • • • • Qualifications: Non-Executive Chair – Corazon Mining Limited (ASX:CZN) (Appointed 1 September 2023) Non-Executive Director - Brazilian Rare Earths Ltd (ASX:BRE) (Appointed 21 December 2023) Non-Executive Director – Tasmea Ltd (ASX:TEA) (Appointed 29 April 2024) Non-Executive Chairperson – ChemX Materials Limited (ASX:CMX) (Resigned 3 February 2023) Non-Executive Director – Tesoro Resources Limited (ASX:TSO) (Resigned 5 October 2023) Non-Executive Director Name: Phil Thick Experience: Phil Thick has over 30 years’ senior executive experience in oil and gas, mining and chemical processing in large multinational companies, smaller ASX listed companies and privately owned companies. In addition, Mr Thick has extensive experience in NonExecutive Director roles and has chaired many of those boards for extended periods. Mr Thick had a 20-year career with Shell in Australia and overseas and for the last 3 years was Downstream Director on the Board of Shell Australia. This was followed by 5 years as a director and CEO of Coogee Chemicals and then 4 years as CEO of New Standard Energy. Prior to joining the Group, Mr Thick led Tianqi Lithium Australia, a subsidiary of Tianqi Lithium Corp out of China, one of the world’s largest lithium companies. Tianqi owns 51% of the Greenbushes mine in Western Australia, the world’s best hard-rock lithium resource, and Mr Thick was charged with building the world’s largest lithium hydroxide plant in Kwinana south of Perth, an investment of nearly $1billion. Mr Thick also chairs the boards of the Chamber of Arts and Culture WA and Perth Symphony Orchestra. During the year, Mr Thick was appointed as Interim Non-Executive Chair from 3 January 2025 to 31 March 2025. Corporate governance committee roles: • • Chair of the Remuneration & Nominations Committee Member of the Audit & Risk Committee Other directorships in listed entities held in the past three years: • Non-Executive Director – Patriot Resources Limited (ASX:PAT) (Appointed 9 December 2022) Livium Ltd Qualifications: BE (Hons), FAICD, FIEAust Page 5 Annual Report For the Year Ended 30 June 2025 Directors’ Report Information on Directors Non-Executive Chair Name: George Bauk (resigned on 3 January 2025) Experience: Mr Bauk is an experienced director with over 15 years’ experience as a listed director in Australia with the resources industry in both production and exploration with assets in Western Australia, Australia and internationally. He is an experienced executive, with 30 years’ experience in the resources industry. Mr Bauk holds a Bachelor of Business (Accounting and Finance) from Edith Cowan University, is a Fellow of the CPA and has an MBA from the University of New England. Mr Bauk has held global operational and corporate roles with WMC Resources and Western Metals. Mr Bauk has a strong background in strategic management, business planning, building teams, finance and capital/debt raising, and experience with a variety of commodities in particular rare earths, gold and industrial minerals. During his time as Managing Director of Northern Minerals Ltd, he led its rapid development from a greenfields heavy rare earth explorer to one of a few global producers of high value dysprosium outside of China. Mr Bauk is a passionate member of the WA resources industry having previously held a number of senior governing positions with the Chamber of Minerals and Energy including Vice President. Corporate governance committee roles: • • Member of the Audit & Risk Committee (Resigned 3 January 2025) Member of the Remuneration & Nominations Committee (Resigned 3 January 2025) Other directorships in listed entities held in the past three years: • • Non-Executive Chairman – PVW Resources Limited (Resigned 6 January 2025) Executive Chairman – Thunderbird Resources Limited (Formerly Valor Resources Limited) (Resigned 9 January 2025) Non-Executive Director – Firetail Resources Limited (Appointed 6 September 2023) Non-Executive Chairman – Gascoyne Resources Limited (Resigned 31 January 2022) Non-Executive Chairman – Evion Group NL (Resigned 23 November 2023) • • • 1.3 Qualifications: BBus, MBA, GAICD Joint Company Secretary Ms Catherine Grant-Edwards (Chartered Accountant (CA)) and Ms Melissa Chapman (Certified Practicing Accountant (CPA), AGIA/ACIS, GAICD) are directors of Bellatrix Corporate Pty Ltd (Bellatrix), a company that provides company secretarial and accounting services to a number of ASX listed companies. Between them, Ms Chapman and Ms Grant-Edwards have over 40 years’ experience in the provision of accounting, finance and company secretarial services to public listed resource and private companies in Australia and the UK, and in the field of public practice external audit. 1.4 Principal Activities The principal activities of the Group during the financial year were to lead and enable the global transition to sustainable lithium production. The Group operates Australia’s market leading lithium-ion battery recycler, develops leading-edge processing technology to produce lithium ferro phosphate (LFP), and develops patented lithium extraction technology. There were no significant changes in the nature of the Group’s principal activities during the financial year. Livium Ltd Page 6 Annual Report For the Year Ended 30 June 2025 Directors’ Report 1.5 Results of operations The operating loss after income tax of the Group for the year ended 30 June 2025 was $4.57m (2024: loss of $10.76m). The key movements between the financials years are summarised in the following graphic: Net Loss After Tax: FY25 vs FY24 ($'m) 0.00 (2.00) (4.00) (6.00) (8.00) (10.00) Gross Profit FY24 Net Loss Income tax benefit Reversal of provision FY25 Net Loss Others Gross profit: During the year, our Battery Recycling Division, Envirostream, delivered higher sales, while maintaining strict control over the cost of sales. This was achieved by delivering revenue of ~$6.9m (3% increase on FY24) and gross profit of ~$4.2m (91% increase on FY24), representing a gross profit margin of ~61% (FY24: 33%). Reversal of provision: During the year, legal discovery commenced in relation to certain historical claims associated with the fire provision. During this process, new information was identified which supported a change in the assumptions underpinning the provision estimate. As a result, the provision was reduced by $2.1m, from $7.5m to $5.4m, with the release recognised through profit or loss. Income tax benefit: A Deferred Tax Asset (DTA) of $1.6m was recognised during the year for the utilisation of Envirostream’s carried-forward tax losses, resulting in a corresponding tax benefit in profit or loss (FY24: Nil). These tax losses are available to offset against future taxable income of that entity. Recognition has been based on management’s assessment that it is probable Envirostream will generate sufficient taxable income to utilise the losses, with the initial trigger being the actual taxable profits in FY25. Net assets of the Group for the year ended 30 June 2025 were $6.66m (2024: $3.36m). The key movements between the financial years are summarised in the following graphic: Net Assets: FY24 vs FY25 ($'m) 7.00 6.00 5.00 4.00 3.00 2.00 1.00 0.00 Current Assets FY24 Current Liabilities Non Current Assets FY25 Non Current Liabilities Current Assets: Cash expenditure and reduced financial assets. Non-Current Assets: Primarily due to spend of $1.6m on LieNA® development costs (Intangible Assets) in accordance with the joint development agreement with MinRes. These activities are funded under the Convertible Note deed with MinRes. In addition, a $1.6m deferred tax asset (DTA) was recognised in relation to the future utilisation of tax losses for Envirostream, as described above. Current Liabilities: A $2.1m reversal of provision, as described above. Livium Ltd Page 7 Annual Report For the Year Ended 30 June 2025 Directors’ Report Non-Current Liabilities: No material movements. The working capital deficit for the financial year ended 30 June 2025 included a provision of $5.4m for remediation of legal claims relating to a fire in January 2019 at the premises of Envirostream Australia Pty Ltd, a wholly owned subsidiary of the Group. During the year, $2.1m of the provision was released based on updated information obtained during the legal discovery process. It is expected that insurances are sufficient to meet the remaining provision (refer to Note 15 for further details). There are reasonable grounds to believe that the Group will be able to pay its debts as and when they become due and payable. 1.6 Dividends There are no dividend or distribution reinvestment plans in operation and there have been no dividend or distribution payments during the financial year ended 30 June 2025 (2024: Nil). Livium Ltd Page 8 Annual Report For the Year Ended 30 June 2025 Directors’ Report 2 Review of Operations 2.1 Overview Livium Ltd (“Livium” or the “Company”) is participating in the global transition to a reduced carbon dependent economy via active participation in the lithium supply chain. While not neglecting the IP that has been developed by our Lithium Chemicals Division (LieNA®) and by our Battery Materials Division (VSPC), our attention in this last year has increasingly turned towards developing a sustainable Battery Recycling business (Envirostream). That focus has resulted in substantial operational and commercial progress, underpinned by execution of long-term strategic agreements, and financial performance improvements. Envirostream is wellplaced to capitalise on the growing market penetration of lithium-ion batteries and hence the increasing downstream generation of lithium-ion battery failure waste or waste from time driven battery degradation. When market conditions are conducive to investment, we will revisit the opportunities that our IP represents to generate long term shareholder value. 2.1.1 Board changes On 3 January 2025, Mr George Bauk resigned as Non-Executive Chair effective 3 January 2025 to pursue a new executive role. Phil Thick was appointed interim Non-Executive Chair on 3 January 2025 until 31 March 2025. Mr Phillip Campbell was appointed as Non-Executive Chair effective 1 April 2025. 2.1.2 Change of name During the year, the Company’s name changed from Lithium Australia Limited to Livium Ltd reflecting the final step in our shift from mining to critical materials in the battery industry. ‘Liv’ connotes life, further reinforcing our commitment to a better life for all. A promise which is positive, optimistic, enabling and purposeful. Built for today’s increasingly environmentally conscious and activated marketplace. Whilst ‘ium’ represents both our core capability - Lithium, as well as being aligned to the word continuum. Which speaks to our dedication to delivering a truly sustainable circular economy. 2.1.3 Working capital management At 30 June 2025, Livium held cash and cash equivalents of approximately A$3.8m. 2.1.3.1 Fund raising During the year the company completed the following activities: • a placement agreement with The Lind Partners with funding up to a total of A$7.5m (Lind Funding); • a share purchase plan raising ~A$1.0m; and • a placement with gross proceeds of A$4.5m to existing shareholders, alongside new institutional and sophisticated investors (Placement). The Placement resulted in the issue of 331,404,580 new fully paid o