Lithium Australia has announced its battery recycling operations have achieved maiden operating profit in Q4 2024.
Lithium Australia has announced its battery recycling operations have achieved maiden operating profit in Q4 2024.
The company said the maiden profit for subsidiary Envirostream Australia was buoyed by a transition toward an upstream service model which saw exclusive commercial agreements with customers including LG, Volvo and Hyundai.
In Q4 FY24, Envirostream achieved collection volumes of 445 tonnes, revenue of $2.5 million, gross profit of $1.56 million and operating cash profit of $520,000.
The figures represented a jump from $1.21/kg gross profit in Q3 FY24 to $3.50/kg in Q4 FY24.
Lithium Australia chief executive and managing director Simon Linge said the maiden profit was a significant milestone for the recycling arm of the company.
“This outcome, delivered in a period of low commodity prices, was driven by our growth in our fee for service model for battery recycling with all customers over the last year, which enables us to receive the majority of revenue upfront on improved terms,” he said.
“Our revised commercial model supports our ongoing joint development discussions with SungEel HiTech, which seek to scale up our operations in line with expected growth in LIB collection volumes.”
Lithium Australia general manager of recycling Steven Marshall said the company was focused on signing new recycling agreements with leading OEMs to accelerate battery collection volumes.
“Achievement of the improved unit economics was driven by the increased collection volumes of large-format LIBs from exclusive recycling services agreements with leading OEMs,” he said.
“These agreements, which would not have been possible without our safety and operational improvements, also allowed the company to reduce its exposure to market volatility relating to commodity prices, including MMD, our key processes output.”
Lithium Australia shares were up 38 per cent today to $0.025.
