Battery recycler Li-Cycle more than doubles quarter-on-quarter revenues

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Lithium-ion battery recycling specialist Li-Cycle reported US$8.7 million in revenues for the quarter ended April 30, 2022, more than double the previous quarter.

Li-Cycle said the growth in revenues – 29x higher than the same quarter the previous year – was driven by increases in product sales volume and metal-based prices. Its operating expenses increased to US$30 million, six times higher than the US$5.6 million in the same period last year.

That resulted in a net loss of US$20.7 million, up 165% year-on-year. Adjusted EBITDA loss was US$19.5 million. Its financial year runs to October 31.

The company recycles lithium-ion batteries from both EVs and energy storage and its two-step process can achieve a 95% recovery rate. It recently opened its third recycling facility, in Arizona, its third ‘Spoke’ facility. Spoke facilities process battery scrap and end-of-life batteries before sending the resulting black mass to a recycling hub in New York, set to come online in 2023, which will refine it into the different critical materials which can then be used in lithium-ion battery production.

The company expects the energy storage system (ESS) sector to be a major contributor both for providing materials but also for offtaking recycled materials Li-Cycle produces.

During its most recent quarter, the company entered into long-term agreements with LG and Glencore to be their preferred lithium-ion battery recycling partner. The two companies will provide feedstock and scrap to Li-Cycle’s hubs while Glencore will provide black mass and sulfuric acid for its hub once open. Both LG and Glencore will have also signed offtake agreements for some of Li-Cycle’s battery-grade products produced at the Rochester hub.

“We continued to successfully implement our Spoke & Hub network strategy, with significant operational, commercial, and financial achievements this quarter,” Ajay Kochhar, Li-Cycle President and Chief Executive Officer.

“Strategically, we are positioning Li-Cycle as a leading and preferred recycler and supplier of critical battery materials, capitalizing on the significant secular growth trends.”

Li-Cycle, which went public on the New York Stock Exchange in August last year through a SPAC merger, finished its second quarter with US$509.3 million cash in hand. That rises to US$760 million on a pro-forma basis including the investments totalling US$250 million from LG and Glencore as part of those deals.

The company plans to open spoke facilities in Europe – Norway and Germany – in the first half of 2023, and by the end of that year anticipates having an annual recycling capacity of 65,000 tonnes. Based on figures previously provided to by Kunal Phalpher, Li-Cycle CCO, that 65,00 tonnes equates to material from approximately 13GWh of batteries.

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