Lifezone Metals (LZM) - 2025 Q2 - Quarterly Report

Financial Performance - Lifezone's income for the six months ended June 30, 2025, was $2.25 million, compared to a loss of $10.94 million for the same period in 2024 [36]. - Lifezone's accumulated losses at June 30, 2025, were $451.8 million, slightly down from $454.5 million at December 31, 2024 [36]. - For the six months ended June 30, 2025, total revenue was $325,451, a significant increase from $49,650 in the same period of 2024, representing a growth of 553% [89]. - The group reported an income of $2,065,048 for the six months ended June 30, 2025, compared to a loss of $10,941,387 in the same period of 2024 [118]. - Lifezone's net income for the six months ended June 30, 2025, was $2,705,578, a significant improvement from a net loss of $10,699,490 in the same period of 2024 [188]. - Basic earnings per share for the six months ended June 30, 2025, was $0.03, while diluted earnings per share was $(0.08) [188]. Cash and Liquidity - As of June 30, 2025, Lifezone had consolidated cash and cash equivalents of $12.5 million, a decrease of $16.8 million from $29.3 million as of December 31, 2024 [37]. - Lifezone's cash and cash equivalents decreased to $12,512,058 as of June 30, 2025, from $29,283,942 at the end of 2024 [97]. - Lifezone expects to fund its capital requirements and ongoing operations through current cash reserves, equity, mezzanine, debt funding, or monetizing the offtake from the Kabanga Nickel Project [195][204]. Debt and Financing - A $60 million senior secured bridge loan facility agreement was entered into on August 8, 2025, to support the advancement of the Kabanga Nickel Project [40]. - Lifezone's total liabilities as of June 30, 2025, were $67,301,686, with significant obligations due in the next two years [197]. - The bridge loan has a maturity date of July 31, 2027, with a possible six-month extension and an interest rate of 9.25% per annum [210]. - Lifezone completed a $50 million non-brokered private placement of unsecured convertible debentures on March 27, 2024, to fund the Kabanga Nickel Project [137]. - The effective interest rate on the convertible debentures is 33.8%, with the amortization of the host debt instrument included in finance costs [147]. Project Development - The Feasibility Study for the Kabanga Nickel Project was released on July 18, 2025, focusing on a 3.4 million tonnes per annum mechanized underground mine and supporting infrastructure [24]. - Lifezone capitalized exploration and evaluation costs based on the reasonable prospect of developing the Kabanga Nickel Project into a profitable operation [113]. - Lifezone acquired BHP's 17% equity interest in KNL, resulting in 100% ownership of KNL and full control of the Kabanga Nickel Project's offtake [209]. - Exploration and evaluation assets for the Kabanga Nickel Project reached $114,685,640 as of June 30, 2025, with additions of $9,854,252 during the period [112]. Operational Highlights - Lifezone invested $2 million into Lifezone Recycling US, LLC in May 2025 to complete a pilot testwork program and feasibility study for PGM recycling [30]. - The feasibility study for the hydromet PGM recycling facility is expected to be completed in the second half of 2025 [30]. - Lifezone's intellectual property includes six patent families related to enhancements in the Hydromet Technology process for metal production [110]. Tax and Regulatory Matters - Lifezone has provided $3,434,062 due to a court ruling related to a historical withholding tax assessment in Tanzania, with potential additional liability of up to $4,663,387 if additional interest charges are not waived [205]. - The company is engaged in discussions with the TRA regarding an out-of-court settlement for disputed tax matters, with expectations of waiving additional interest charges [132]. - Lifezone's effective tax rate is 0% as no taxable income was recognized for the current and prior periods [118]. Shareholder Information - The Liddell family holds approximately 30% of all outstanding Lifezone Metals shares as of June 30, 2025, indicating significant influence over the company [152]. - Lifezone granted 2,600,000 RSUs on July 1, 2024, with 933,333 RSUs vesting immediately and the remaining 1,666,667 subject to market price performance conditions of $14.50 and $16.00 per share [180]. - The total share-based payment expense related to RSU awards for the six months ended June 30, 2025, was $nil, compared to $32,457 for the same period in 2024 [182]. Management and Governance - Lifezone Metals is classified as a Foreign Private Issuer (FPI) under U.S. securities laws, allowing it to follow home country corporate governance practices [54]. - Lifezone is recognized as an Emerging Growth Company (EGC), which provides exemptions from certain reporting requirements, including auditor attestation under Section 404 of the Sarbanes-Oxley Act [59]. - The company is required to reassess its FPI status annually, which could lead to compliance with more extensive U.S. domestic issuer requirements if it loses this status [57].