CMX
Chemx Materials Limited
ASX
Annual Report
Sentiment:
Annual Report
23 October 2024 5:19 AM
ChemX Materials Limited (ASX: CMX) reported a loss after tax of $4.49 million for FY24, driven by lower expenses offset by increased finance charges and project investments, while making significant progress on its High Purity Alumina (HPA) and Manganese projects.
Worse than expected
The company reported a net loss after tax of \$4.49 million, significantly higher than the previous year's loss of \$4.18 million, indicating worse than expected results.
Capital raise
The company raised \$1,616,600 through a share placement and share purchase plan.
A \$6,000,000 convertible note funding facility was secured, with potential for further equity dilution upon conversion.
Summary
- ChemX Materials Limited reported a loss after income tax of \$4,485,548 for the financial year ending 30 June 2024 (FY24).
- The company's loss in FY24 was primarily due to lower employee and corporate expenses, partially offset by higher finance costs from convertible notes and project investments.
- ChemX achieved a maiden manganese resource estimate of 13.7 million tonnes at 5.7% Mn in September 2023.
- The company's HPA Micro Plant successfully produced HPA with purity exceeding 99.99% (4N), and the HPA Pilot Plant was 95% complete as of October 2024.
- ChemX raised \$1,616,600 through a share placement and share purchase plan in the second half of FY24.
- The company secured a \$6,000,000 convertible note funding facility in August 2023, with drawdowns of \$500,000 and \$1,700,000.
- ChemX received three patents for its HiPurA technology in Australia, New Zealand, and Africa (OAPI), with further international patents pending.
- The company appointed TritonLake as its strategic global corporate and financial advisors.
- ChemX's HPA Pilot Plant is expected to produce 24 tonnes per annum (tpa) of HPA upon commissioning.
Sentiment
Score: 4
Explanation: While the company highlights positive progress on its projects, the significant net loss and material uncertainty regarding its going concern status significantly lower the overall sentiment.
Highlights
- FY24 loss after income tax: \$4,485,548
- Maiden manganese resource: 13.7mt at 5.7% Mn
- HPA Micro Plant achieved >99.99% (4N) purity
- HPA Pilot Plant 95% complete (October 2024)
- Share placement and SPP raised \$1,616,600
- \$6,000,000 convertible note facility secured
- Three patents granted (Australia, New Zealand, Africa)
- HPA Pilot Plant capacity: 24 tpa
- TritonLake appointed as corporate advisors
Positives
- Successful production of HPA exceeding 99.99% purity (4N)
- Significant progress on HPA Pilot Plant construction (95% complete)
- Maiden manganese resource estimate announced
- Successful capital raising through share placement and SPP
- Securing of a substantial convertible note funding facility
- Grant of three patents for HiPurA technology
- Appointment of TritonLake as strategic advisors
Negatives
- Net loss after income tax of \$4,485,548 for FY24
- Material uncertainty about the company's ability to continue as a going concern
- Need for further funding to complete planned activities
Risks
- Economic risks (commodity prices, interest rates, inflation)
- Market conditions (investor sentiment, demand for capital)
- Force majeure events (labor unrest, natural disasters)
- Government and legal risks (changes in regulations, taxation)
- Litigation risks (native title claims, environmental claims)
- Insurance risks (inadequate coverage for certain risks)
- Unforeseen expenditure
- Climate change risks (new regulations, physical risks)
- Infectious diseases (impact of pandemics)
- Going concern risk (insufficient funds for long-term operations)
- Capital requirements (need for additional financing)
- Contractual risks (mineral rights agreement with Pirie Resources)
- HPA work program risks (scale-up risk, cost overruns, delays)
- Exploration and operating risks (geological conditions, weather, technical difficulties)
- Tenure, access, and grant of applications risks
- Reliance on key personnel
- Research and development risks (uncertain commercial viability)
- Production risks (operational issues, cost overruns)
- Marketing risks (finding buyers, meeting specifications)
Future Outlook
The company anticipates becoming a notable producer of +4N HPA from its Perth-based 24 tpa HiPurA Pilot Plant once commissioned and expects further international patents in subsequent reporting periods. The company will evaluate the outcomes of the Wood led scoping study before undertaking further exploration work on the Eyre Peninsula and is considering options to move the manganese project forward, which may include a joint venture or outright sale.
Management Comments
- It is a credit to the staff at ChemX and management team to have been able to move the HPA project forward with validation of the flow sheet by achieving the required purity levels of 4N HPA allowing the Company to push forward with the construction of the HPA Pilot Plant.
- High purity materials are the future of technology. ChemX has developed unique skill sets and analytical processes which place it in a sound position to take advantage of the next wave of consumer product innovation.
- Notwithstanding the challenges currently experienced in the critical minerals sector, ChemX sees new opportunities for HPA and related high purity products in the emerging world of Artificial Intelligence Semiconductors, synthetic sapphire and Micro LEDs which are increasingly becoming embedded in the consumer products sector
Industry Context
The critical materials space, including HPA and manganese, is experiencing challenges due to a perceived oversupply, particularly in lithium and nickel. ChemX is positioning itself to capitalize on emerging opportunities in AI semiconductors, synthetic sapphire, and Micro LEDs, which require high-purity materials.
Next Steps
- Complete construction and commissioning of the HPA Pilot Plant
- Dispatch product samples to potential customers
- Seek partners for joint ventures and offtake agreements
- Undertake further exploration work on the Eyre Peninsula (pending scoping study results)
- Evaluate options for the manganese project (joint venture or sale)
- Continue to develop HiPurA technology and expand into related businesses
Key Dates
- 26 October 2023: Tara Berrie resigned as Non-Executive Director
- 4 August 2023: \$6,000,000 unsecured convertible note funding facility announced with Mercer Street Global Opportunity Fund, LLC
- 26 September 2023: Shareholder approval for \$1,700,000 drawdown from convertible note facility
- 20 September 2023: ASX announcement of Manganese Resource
- 14 August 2023: Tranche 1 of convertible note facility issued
- 2 August 2023: Peter Lee appointed as Chief Executive Officer
- 9 October 2023: Tranche 2 of convertible note facility issued
- 27 May 2024: Shareholder approval for director share placement participation
- 30 June 2024: End of financial year
- 1 July 2024: Stephen Strubel transitioned to Non-Executive Director
- 6 September 2024: Received \$250,000 as tranche 1 of a short term loan facility from Radium Capital
- 30 September 2024: Financial statements authorised for issue
- 23 October 2024: Chairman's address dated
Keywords
High Purity Alumina, HPA, Manganese, HiPurA, Pilot Plant, Mineral Resource, Critical Minerals, Battery Materials, Exploration, Australia, Capital Raising, Financial Results, Annual Report
CMX
Chemx Materials Limited
ASX
Sector: Materials
Filings with Classifications
Capital raise
13 April 2025 9:55 PM
Insolvency Announcement
- Benelong Capital Partners (BCP) recapitalisation proposal requires ASIC, ASX and shareholder approval.
Worse than expected
29 December 2024 5:48 PM
Trading Suspension Extension Request
- The company is not ready to announce a Funding Update and Management Restructure, which is causing a delay in trading and is worse than expected.
Delay expected
29 December 2024 5:48 PM
Trading Suspension Extension Request
- The company is delaying the release of the Funding Update and Management Restructure announcement.
- The trading suspension is being extended due to the delay in the announcement.
Delay expected
22 December 2024 5:25 PM
Trading Suspension Update
- The company's funding update and management restructure are taking longer than anticipated.
- Negotiations with relevant parties have caused a delay in the announcement.
Capital raise
18 December 2024 5:08 PM
Suspension Announcement
- The announcement is related to an update on funding, which could indicate a potential capital raise.
Capital raise
16 December 2024 5:06 PM
Trading Halt Request
- The trading halt is pending an announcement regarding an update on funding, which could indicate a potential capital raise.
Capital raise
11 December 2024 5:11 PM
Financing Agreement Update
- Mercer has approved ChemX to raise up to $500,000 in additional debt financing.
Delay expected
27 November 2024 9:50 PM
AGM Presentation
- The commissioning of the 24tpa HPA Pilot Plant has experienced unforeseen delays in recent months, primarily due to the solvent extraction (SX) module awaiting electrical package installation.
Worse than expected
27 November 2024 9:50 PM
AGM Presentation
- The announcement revealed unforeseen delays in the commissioning of the solvent extraction module of the pilot plant, pushing back the timeline for full operation.
Better than expected
13 November 2024 5:17 PM
R&D Funding Announcement
- The receipt of the R&D refund exceeding the amount of the Radium Capital facility was better than expected, resulting in a surplus for working capital.
Capital raise
7 November 2024 1:19 AM
Price Query Response
- ChemX is in discussions with third parties regarding potential capital raisings.
- No formal agreements have been reached for any capital raising.
Capital raise
30 October 2024 9:06 PM
Quarterly Report
- The company has appointed TritonLake as Corporate and Financial Advisors to assist with capital, financing and corporate advisory.
- The company believes it would be successful with raising additional capital.
Worse than expected
30 October 2024 9:06 PM
Quarterly Report
- The delays in the Solvent Extraction module of the pilot plant represent a setback from the expected timeline for commissioning.
Delay expected
30 October 2024 9:06 PM
Quarterly Report
- Delays were experienced in the construction of the Solvent Extraction (SX) module due to longer than expected lead times on key process equipment and delivery of critical electrical infrastructure.
Capital raise
24 October 2024 6:10 PM
Notice of Annual General Meeting
- The 7.1A mandate seeks shareholder approval to issue up to 10% of the company's issued capital in equity securities without further shareholder approval.
- The funds raised under the 7.1A mandate are intended to be used for the 24tpa HiPurA high purity alumina (HPA) pilot plant and working capital.
Worse than expected
23 October 2024 5:19 AM
Annual Report
- The company reported a net loss after tax of \$4.49 million, significantly higher than the previous year's loss of \$4.18 million, indicating worse than expected results.
Capital raise
23 October 2024 5:19 AM
Annual Report
- The company raised \$1,616,600 through a share placement and share purchase plan.
- A \$6,000,000 convertible note funding facility was secured, with potential for further equity dilution upon conversion.
Capital raise
30 July 2024 4:54 AM
Quarterly Activities Report
- The company has applied for an advance from a funding provider against expected CMX FY24 R&D claim for circa $440,000.
- The Company also has access to financial markets and believes it can successfully raise capital.
Capital raise
29 April 2024 7:02 PM
Quarterly Activities Report
- The company completed a $1.1M placement.
- A Share Purchase Plan (SPP) is ongoing, aiming to raise up to $500,000.
- Directors have committed to subscribe for 1,354,166 shares, subject to shareholder approval, under the Placement to raise an additional $65,000 at the same issue price.
Delay expected
21 April 2024 7:10 PM
Share Purchase Plan Extension Announcement
- The closing date of the SPP has been extended from April 23, 2024, to May 10, 2024.
Capital raise
2 April 2024 5:48 PM
Share Purchase Plan Announcement
- The document mentions that it is highly likely that further funding will be required to meet the medium to long term working capital costs of the Company.
- Any additional equity financing will dilute shareholdings, and debt financing, if available, may involve restrictions on financing and operating activities.
Capital raise
13 March 2024 2:33 AM
Interim Report
- The company has access to a further $3,800,000 funding under its unsecured convertible note facility, subject to further agreement between the parties.
Worse than expected
13 March 2024 2:33 AM
Interim Report
- The company reported a net loss of $1,911,696 for the half-year ended December 31, 2023, which is worse than breakeven.
Disclaimer: This summary was generated by artificial intelligence and its accuracy is not guaranteed. The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.