Leading Edge Materials Reports Fiscal 2021 Results
NEWS RELEASE January 26, 2022
LEADING EDGE MATERIALS CORP.
1305 – 1090 West Georgia Street, Vancouver, BC, V6E 3V7
[email protected] | www.leadingedgematerials.com
TSX.V: LEM | Nasdaq First North: LEMSE | OTCQB: LEMIF | FRA: 7FL
TSX.V: LEM | Nasdaq First North: LEMSE | OTCQB: LEMIF
LEADING EDGE MATERIALS REPORTS FISCAL 2021 RESULTS
Vancouver, January 26, 2022 – Leading Edge Materials Corp. (“Leading Edge Materials” or the
“Company”) (TSXV: LEM) (Nasdaq First North: LEMSE) (OTCQB: LEMIF) (FRA: 7FL) announces results for the
fiscal year ending October 31, 2021. All references to dollar amounts in this release are in Canadian dollars.
Highlights During and After Fiscal 2021
During fiscal 2021, the Company:
• Commissioned Minviro Ltd., a London based globally recognized life cycle assessment (“LCA”) consultancy,
to build an LCA model and deliver an LCA report for the Woxna Graphite project. The LCA work carried out
by Minviro included a cradle -to-gate life cycle inventory and a life cycle impact asses sment for five impact
categories of interest. The results were delivered to the Company in form of an ISO-Compliant Full Life Cycle
Assessment and Report.
• Appointed Mr. Sanjay Swarup as new Chief Financial Officer on March 1, 2021.
• Completed the sale to United Lithium Corp. (ULTH) of 100% of the Bergby Lithium project.
• Announced that the Mining Inspectorate of Sweden rejected the mining lease application for the Norra Karr
project. The Company subsequently appealed this decision to the Government of Sweden.
• Announced positive preliminary economic assessment results for its Woxna graphite anode project with
US$317/US$248 million pre/post -tax NPV and 42.9%/37.4% pre/post -tax IRR with the subsequent filing of
the technical report entitled "NI 43 -101 Technical Report – Woxna Graphite" prepared for Woxna Graphite
AB with effective date June 9, 2021 and issue date July 23, 2021, available on Leading Edge's website
www.leadingedgematerials.com and under its SEDAR profile www.sedar.ca.
• Announced positive preliminary economic assessment results for its Norra Karr REE project with pre - and
post-tax Net Present Value (NPV) of $1,026M and $762M using a 10% discount rate and pre - and post-tax
Internal Rate of Return (IRR) of 30.8% and 26.3%. Subsequently filed the technical report titled “PRELIMINARY
ECONOMIC ASSESSMENT OF NORRA KARR RARE EARTH DEPOSIT AND POTENTIAL BY-PRODUCTS, SWEDEN"
prepared for Leading Edge Materials Corp. with effective date August 18, 2021 and issue date August 19,
2021, available on Leading Edge's website www.leadingedgematerials.com and under its SEDAR profile
www.sedar.ca.
• Announced that its 100% owned Swedish subsidiary Woxna Graphite AB signed a non -binding Heads of
Agreement with Sicona Battery Technologies Pty Ltd laying out the path for the e stablishment of a Sweden
based 50/50 Joint Venture targeting the production of advanced natural graphite and silicon -graphite-
carbon composite active anode materials.
After fiscal 2021:
• 4,364,285 and 57,143 warrants were exercised at $0.37 and $0.10 resp ectively for proceeds of $1,620,499
with a significant participation by insiders of the Company, and 200,000 options were exercised at $0.225
for proceeds of $45,000.
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Results of Operations
Three Months Ended October 31, 2021 Compared to Three Months Ended July 31, 2021
During the three months ended October 31, 2021 (“Q4”) the Company reported a net loss of $554,925 compared
to a reported net loss of $1,077,588 for the three months ended July 31, 2021 (“Q3”), a decrease in loss of
$522,663, the decrease in loss is mainly due to market to market loss booked for $430,315 in Q3 compared to
a mark to market gain of $122,484 booked in Q4.
Year Ended October 31, 2021 Compared to Year Ended October 31, 2020
During the year ended October 31, 2021 (“2021 period”) the Company reported a net loss of $1,210,718
compared to a net loss of $1,721,821 for the year ended October 31, 2020 (“2020 period”), a decrease in loss of
$511,103. The decrease in loss was primarily attributed to the gain on the sale of the Bergby Project in the 2021
period.
Selected Financial Data
The following selected financial information is derived from the audited condensed consolidated interim
financial statements of the Company prepared in accordance with IFRS.
Fiscal 2021 Fiscal 2020
Three Months
Ended
October 31,
2021
$
July 31,
2021
$
April 30,
2021
$
January 31,
2021
$
October 31,
2020
$
July 31,
2020
$
April 30,
2020
$
January 31,
2020
$
Operations
Expenses (460,907) (600,531) (483,495) (664,674) (882,556) (420,959) (337,609) (375,930)
Other items (94,018) (477,057) 1,573,567 (3,603) 327,987 (21,567) 20,187 (31,374)
Comprehensive
profit/(loss) (554,925) (1,077,588) 1,090,072 (668,277) (554,569) (442,526) (317,422) (407,304)
Basic Profit/(loss)
per share (0.01) (0.01) 0.01 (0.00) (0.01) (0.00) (0.00) (0.00)
Diluted
profit/(loss) per
share
(0.01) (0.01) 0.01 (0.00) (0.01) (0.00) (0.00) (0.00)
Financial Position
Working capital 2,350,166 2,803,903 3,935,156 2,598,191 3,277,010 3,354,422 499,883 711,727
Total assets 28,756,406 28,455,148 29,133,933 28,759,753 27,218,052 27,832,104 24,722,718 24,803,562
Total non-current
liabilities (9,946,686) (9,054,376) (8,620,700) (9,154,787) (7,053,874) (7,486,123) (7,452,242) (7,154,761)
Financial Condition / Capital Resources
During the year ended October 31, 2021, the Company recorded a net loss of $1,210,718 and, as at October 31,
2021 the Company had an accumulated deficit of $41,104,271 and working capital of $2,350,166. The Company
is maintaining its Woxna Graphite Mine on a “production-ready” basis to minimize costs and is conducting
ongoing research and development to produce higher specialty products. The Company anticipates that it has
sufficient funding to meet anticipated levels of corporate administration and overheads for the ensuing twelve
months however, it will need additional capital to provide working capital and recommence operations at the
Woxna Graphite Mine and/or modernize the plant to produce value added production, to fund future
development of the Norra Karr Property and complete the tendering process and, if successful, exploration
activities in Romania. There is no assurance such additional capital will be available to the Company on
acceptable terms or at all. In the longer term the recoverability of the carrying value of the Company’s long-
lived assets is dependent upon the Company’s ability to preserve its interest in the underlying mineral property
interests, the discovery of economically recoverable reserves, the achievement of profitable operations and the
ability of the Company to obtain financing to support its ongoing exploration programs and mining operations.
See also “COVID-19”.
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During the year ended October 31, 2021, 493,109 options and 63,571 warrants were exercised for gross
proceeds of $95,348 and $6,357 respectively.
During fiscal 2020 the Company completed the following private placement financings:
(i) 18,000,000 units at $0.056 per unit for gross proceeds of $1,008,000; and
(ii) 32,000,000 units at a price of $0.11 per unit for gross proceeds of $3,520,000.
In addition, during fiscal 2020 the Company issued 800,000 common shares on the exercise of warrants for
$80,000. The net proceeds from these financings and warrant exercises have been designated to maintain the
Company’s projects in Sweden and Romania and for general working capital and corporate purposes.
Outlook
In December 2021 for the first time ever, there were more electric cars than diesel cars sold in
Europe1. Meanwhile, during the last days of the year, Northvolt produced its first battery cell at the
Swedish gigafactory, moving towards commercial production in 20222. The energy transition in
Europe is truly underway, and similar developments can be seen across the globe. The demand
growth from the downstream, coupled with continued supply chain disruptions due to the ongoing
pandemic and a global power crunch3 has resulted in lack of supply and resulting price increases for
the raw materials needed to fuel the transition45. These developments continue to support Leading
Edge Material’s business strategy to establish more secure and sustainable supply alternatives of
critical raw materials.
Towards the end of 2021, graphite’s importance as a battery material came into the spotlight as
Tesla filed requests for tariff exemptions due to not being able to source this key anode material
outside of China6. Shortly thereafter, Tesla announced a future supply deal with one of the emerging
US producers of natural graphite anode materials demonstrating the importance of potential
regional supply alternatives7. Graphite prices rose sharply over 2021 with consultancies expecting
the price trend to continue into 2022 due to persistent demand growth and supply challenges8. The
International Monetary Fund went as far to say that graphite would be the material in the energy
transition sector experiencing the largest supply shortfall unless significant production increases
materialize9.
Similar market dynamics could be observed for rare earth elements where prices for key rare earth
oxides for permanent magnet production rose between 50 and 150 percent during 202110, with
1 https://www.afr.com/world/europe/european-sales-of-electric-cars-overtake-diesel-models-for-first-time-20220117-
p59oqw
2 https://northvolt.com/articles/first-cell/
3 https://www.benchmarkminerals.com/membership/chinas-energy-crisis-hits-domestic-cathode-and-anode-production/
4 https://www.greencarcongress.com/2021/10/20211030-graphite.html
5 https://www.metalbulletin.com/Article/4009238/Home/FOCUS-Chinas-power-cut-policy-threatens-the-battery-materials-
supply-chain.html
6 https://www.bloombergquint.com/gadfly/if-tesla-is-having-supply-chain-troubles-everyone-should-worry
7 https://www.metalbulletin.com/Article/4021911/Tesla-Syrah-graphite-deal-signals-OEMs-taking-notice-of-anode-supply-
bottlenecks.html
8 https://www.fastmarkets.com/robust-demand-likely-to-support-natural-graphite-anode-supply-chain-2022-preview
9 https://www.fastmarkets.com/imf-report-suggests-possible-85-shortfall-in-graphite-supply-by-2050
10 https://treo.substack.com/p/china-rare-earth-group-details-chinas
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continued strength in the new year11 12. Most of current spot prices are significantly higher13 than
the prices that were used in the preliminary economic assessment for the Norra Karr project14. It is
becoming obvious that the main global supplier, China, is increasingly looking to use its internal rare
earth feedstocks to supply its own downstream customers15. Downstream customers and OEMs
outside of China are taking note with GE and GM announcing joint plans to establish secure and
sustainable value chains for rare earths in North America and Europe 16 . GM subsequently
announced two separate deals to source permanent magnets from US based production17. In
Europe a similar development was announced with Neo Performance Materials looking to establish
permanent magnet production in Estonia18. All these downstream initiatives outside of China still
lack details of from where the rare earth raw materials will be sourced, especially for the heavy rare
earths such as dysprosium and terbium where even China is relying on non-transparent and
questionable supply from Myanmar19. As there is an ongoing expanding supply and demand gap in
China20, the situation will not be easier for the rest of the world.
Industry developments are being matched by an increasing effort from the political side to support
the establishment of secure and sustainable value chains regionally. The European Parliament
adopted a resolution on a European strategy for critical raw materials, outlining a number of
measures to support the establishment of EU based raw material supply alternatives 21. On a
national level, France announced their own plans to raise €1 billion of funds, including €500 million
in public money, to secure the required raw materials for battery and permanent magnet
production22. Across the Atlantic the US continued its efforts to decouple from its reliance on China
for rare earths with the introduction of a bipartisan bill looking to block the defence industry from
using Chinese rare earths23. More important for the development of our Swedish projects, with the
Swedish Green Party leaving the ruling coalition in Sweden the new Social Democratic government
has come out with positive support for the industry. Only after a short time in office, the new minister
of enterprise was quoted to say that “they love mines” and want to open and permit more new
mines24.
2021 turned out to be a pivotal year as many of the fundamental drivers underpinning the strategy
of Leading Edge Materials materialized in force. With this backdrop, the scene is set for 2022 to
become an eventful year as we continue our project development plan in line with our strategy.
11 https://www.kitco.com/news/2022-01-14/Rare-earth-metals-market-strong-as-global-EV-fleet-hits-record-levels-supply-
tightens-report.html
12 https://twitter.com/LeadingEdgeMtls/status/1483104329519316996
13 https://www.metal.com/price/Rare%20Earth/Rare-Earth-Oxides
14 https://leadingedgematerials.com/wp-content/uploads/2021/08/NorraKarr_PEA_43-101.pdf
15 https://www.globaltimes.cn/page/202111/1238808.shtml
16 https://www.reuters.com/business/autos-transportation/gm-general-electric-develop-supply-chain-rare-earth-materials-
evs-2021-10-06/
17 https://www.reuters.com/business/general-motors-sets-rare-earth-magnet-supply-deals-with-two-us-suppliers-2021-12-
09/
18 https://www.reuters.com/article/rareearths-magnets-neo-performance-mater/neo-plans-to-develop-european-hub-for-
rare-earth-magnets-in-estonia-idUSKBN2I21CM
19 https://www.myanmar-now.org/en/news/myanmar-resumes-trade-of-rare-earth-minerals-with-china
20 https://news.metal.com/newscontent/101730753/Rare-Earth-Supply-Tightness-May-Intensify-after-CNY-Holiday-/
21 https://erma.eu/erma-welcomes-the-newly-adopted-report-on-critical-raw-materials/
22 https://www.bloomberg.com/news/articles/2022-01-10/france-plans-1-1-billion-to-safeguard-metals-for-ev-batteries
23 https://www.mining.com/web/us-bill-would-block-defense-contractors-from-using-chinese-rare-earths/
24 https://www.tn.se/inrikes/thorwaldsson-hoppas-oppna-flera-gruvor/
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Qualified Person
The scientific, technical and economic information related to the Norra Karr project has been reviewed and
approved by Dr. Rob Bowell of SRK Consulting (UK) Ltd, a chartered chemist of the Royal Society of Chemistry,
a chartered geologist of the Geological Society of London, and a Fellow of the Institute of Mining, Metallurgy
and Materials, who is an independent Qualified Person under the terms of NI 43-101 for REE deposits.
The scientific, technical and economic information related to the Woxna Graphite project has been reviewed
and verified by Christopher Stinton of Zenito Limited, BSc (Hons), CEng MIMMM, an independent Qualified
Person as defined by NI 43-101.
Financial Information
The report for three months ending January 31, 2022, is expected to be published on or about March 24,
2022.
On behalf of the Board of Directors,
Leading Edge Materials Corp.
Filip Kozlowski, CEO
For further information, please contact the Company at:
www.leadingedgematerials.com
Follow us
Twitter: https://twitter.com/LeadingEdgeMtls
Linkedin: https://www.linkedin.com/company/leading-edge-materials-corp/
About Leading Edge Materials
Leading Edge Materials is a Canadian public company focused on developing a portfolio of critical raw
material projects located in the European Union. Critical raw materials are determined as such by the
European Union based on their economic importance and supply risk. They are directly linked to high growth
technologies such as batteries for electromobility and energy storage and permanent magnets for electric
motors and wind power that underpin the clean energy transition towards climate neutrality. The portfolio of
projects includes the 100% owned Woxna Graphite mine (Sweden), Norra Karr HREE project (Sweden) and the
51% owned Bihor Sud Nickel Cobalt exploration alliance (Romania).
Additional Information
The Company’s audited consolidated financial statements for the year ended October 31, 2021 and related
management’s discussion and analysis are available on the Company’s website at
www.leadingedgematerials.com or under its profile on SEDAR at www.sedar.com
The information was submitted for publication through the agency of the contact person set out above, on
January 26, 2022, at 1:45 pm Vancouver time.
Leading Edge Materials is listed on the TSXV under the symbol “LEM”, OTCQB under the symbol “LEMIF” and
Nasdaq First North Stockholm under the symbol "LEMSE". Mangold Fondkommission AB is the Company’s
Certified Adviser on Nasdaq First North and may be contacted via email [email protected] or by phone +46 (0)
8 5030 1550.
6
Reader Advisory
Certain information in this news release may constitute forward-looking statements or forward-looking information within the
meaning of applicable Canadian securities laws (collectively, “Forward-Looking Statements”). All statements, other than statements
of historical fact, addressing activities, events or developments that the Company believes, expects or anticipates will or may occur
in the future are Forward-Looking Statements. Forward-Looking Statements are often, but not always, identified by the use of words
such as “seek,” “anticipate,” “believe,” “plan,” “estimate,” “expect,” and “intend” and statements that an event or result “may,” “will,”
“can,” “should,” “could,” or “might” occur or be achieved and other similar expressions. Forward-Looking Statements are based upon
the opinions and expectations of the Company based on information currently available to the Company. Forward-Looking
Statements are subject to a number of factors, risks and uncertainties that may cause the actual results of the Company to differ
materially from those discussed in the Forward-Looking Statements including, among other things, the Company has yet to generate
a profit from its activities; there can be no guarantee that the estimates of quantities or qualities of minerals disclosed in the
Company’s public record will be economically recoverable; uncertainties relating to the availability and costs of financing needed in
the future; competition with other companies within the mining industry; the success of the Company is largely dependent upon the
performance of its directors and officers and the Company’s ability to attract and train key personnel; changes in world metal
markets and equity markets beyond the Company’s control; the possibility of write-downs and impairments; the risks associated with
uninsurable risks arising during the course of exploration; development and production; the risks associated with changes in the
mining regulatory regime governing the Company; the risks associated with tenure to the Norra Karr property; the risks associated
with the various environmental regulations the Company is subject to; rehabilitation and restitution costs; the Woxna project has
never defined a mineral reserve. The Woxna project has never defined a mineral reserve. On June 9, 2021, Leading Edge announced
the results of an independent preliminary economic assessment for the development of Woxna (the "2021 Woxna PEA"), the full
details of which are included in a technical report entitled "NI 43-101 Technical Report – Woxna Graphite" prepared for Woxna
Graphite AB with effective date June 9, 2021 and issue date July 23, 2021, available on Leading Edge's website
www.leadingedgematerials.com and under its SEDAR profile www.sedar.ca. The 2021 Woxna PEA is preliminary in nature, it includes
inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them
that would enable them to be categorized as mineral reserves, and there is no certainty that the preliminary economic assessment
will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability. On July 22, 2021,
Leading Edge announced the results of an independent preliminary economic assessment for the development of Norra Karr (the
"2021 Norra Karr PEA"), the full details of which are included in a technical report titled “PRELIMINARY ECONOMIC ASSESSMENT OF
NORRA KARR RARE EARTH DEPOSIT AND POTENTIAL BY-PRODUCTS, SWEDEN" prepared for Leading Edge Materials Corp. with effective
date August 18, 2021 and issue date August 19, 2021, available on Leading Edge's website www.leadingedgematerials.com and under
its SEDAR profile www.sedar.ca. The 2021 Norra Karr PEA is preliminary in nature, it includes inferred mineral resources that are
considered too speculative geologically to have the economic considerations applied to them that would enable them to be
categorized as mineral reserves, and there is no certainty that the preliminary economic assessment will be realized. Mineral
resources that are not mineral reserves do not have demonstrated economic viability. Although the Company has attempted to
identify important factors that could cause actual results to differ materially from those contained in the Forward-Looking
Statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance
that such Forward-Looking Statements will prove to be accurate, as actual results and future events could differ materially from
those anticipated in such Forward-Looking Statements. Such Forward-Looking Statements has been provided for the purpose of
assisting investors in understanding the Company’s business, operations and exploration plans and may not be appropriate for
other purposes. Accordingly, readers should not place undue reliance on Forward-Looking Statements. Forward-Looking Statements
are made as of the date hereof, and the Company does not undertake to update such Forward-Looking Statements except in
accordance with applicable securities laws.
On March 11, 2020, the World Health Organization (“WHO”) declared the novel coronavirus outbreak identified as “COVID-19”, as a
global pandemic. In order to combat the spread of COVID-19 governments worldwide have enacted emergency measures including
travel bans, legally enforced or self-imposed quarantine periods, social distancing and business and organization closures. These
measures have caused material disruptions to businesses, governments and other organizations resulting in an economic slowdown
and increased volatility in national and global equity and commodity markets. The Company has implemented safety and physical
distancing procedures, including working from home where possible and ceased all travel, as recommended by the various
governments. The Company will continue to monitor the impact of the COVID-19 outbreak, the duration and impact which is
unknown at this time, as is the efficacy of any intervention. It is not possible to reliably estimate the length and severity of these
developments and the impact on the financial results and condition of the Company and its operations in future periods.