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Beleagured fintech IOUpay (ASX:IOU) — dealing with the fallout of alleged fraud committed by former CFO — said its BNPL business is operating at smaller volumes ‘than previously’ after restarting in late March.

Currently, IOU’s BNPL arm has 75,000 registered customers and 3,000 active merchants.

IOUpay is slashing costs across the business and shrunk the cost base of its BNPL division by 40%. That’s likely to curb top-line growth but IOU thinks this will ‘make profitability … easier to achieve, if a sufficient level of lending was available’.

That’s a big if thrown in by IOUpay.

The fintech said its considering a ‘number of variations to the BNPL business model’ to improve profitability.

Junior explorer Vital Metals (ASX:VML) is down over 20% after saying it was unable to secure intermediate product sales from its Saskatoon rare earths processing facility on ‘commercially satisfactory terms’.

A further review of Saskatoon found the ‘scale of operations and associated unit operating costs will not achieve positive cashflow from the project’.

That is, the project is not currently economically viable.

Vital Metals interim chairman Richard Crookes said ‘there is no economic imperative to complete this demonstration plant at the current time’.

As a result, VML is halting all construction at the Saskatoon plant to preserve cash and ‘seek alternative funding sources’. Construction of the full processing facility is about 50% complete.

One alternative VML mentioned is finding a partner to ‘potentially build a sustainable business model for the Saskatoon business’.

VML is conducting another strategic review of Saskatoon with a three-month deadline and will retain the Saskatoon-based workforce as ‘these important stakeholders [stakeholders?!] will be integral to allowing for a quick re-start of construction and commissioning activities when the foundations for a long-term, sustainable business model are put in place’.

We've paused construction activities at our Saskatoon #REE Processing Facility to seek alternative funding sources & partnerships for a sustainable business model; Winter drilling at Tardiff exceeds target with assays due soon.
📃https://t.co/mQ1KascoFP $VML $VTMXF pic.twitter.com/tmvLderb7v

— Vital Metals (@vital_metals) April 19, 2023

Cancer diagnostics firm Rhythm Biosciences (ASX:RHY) is down 12% after announcing the resignation of chief executive officer and managing director Glenn Gilbert. The resignation will be effective Friday.

No reason was given for the departure, with Rhythm Biosciences only adding it wishes Gilbert well and is grateful for his contribution.

Gilbert assumed the CEO mantle in late 2018.

RHY will not be filling the chief executive vacuum immediately. Instead, executive chairman Otto Buttula ‘will assume additional executive duties’.

Solar panels, wind turbines, electric vehicles…

For all this, one technology will play a pivotal role: batteries. Batteries allow us to store excess electricity to then be used when needed.

And batteries are going to be a massive business. The size of the global battery market is expected to grow more than fourfold between 2021 and 2030, to reach close to US$424 billion.

Of course, the dominant battery at the moment is the lithium-ion battery.

But this is a decades-old technology. What’s more, lithium-ion batteries need massive amounts of critical materials, like cobalt.

So there’s been plenty of efforts to improve lithium-ion batteries to decrease charging times, increase capacity, and make them cheaper.

For instance, recently, the Illinois Institute of Technology — working with the US Department of Energy’s Argonne National Laboratory — said it’s developed a ‘lithium-air’ battery design that could boost energy density to four times that of lithium-ion batteries. This would allow for much longer driving ranges and, so they say, even one day, power a plane and long-haul trucks.

But there’s also been much work done in replacing lithium-ion batteries all together.

Chinese company Contemporary Amperex Technology Co (CATL), for example, had some big news this week on this front…

If you haven’t heard of CATL, it’s the biggest lithium-ion battery manufacturer in the world.

Earlier this week, the company released some interesting news that it’ll be installing sodium-ion batteries in EV models made by Chinese automaker Chery.

Our first sodium-ion battery will power the Chery EV models. The award-winning technology breaks the bottleneck of limited raw materials and provides a cost-effective solution. pic.twitter.com/yWLEQJ4e3B

— CATL (@catl_official) April 16, 2023

As you may have guessed, sodium-ion batteries are made with sodium, a material that’s found in salt that’s cheap and abundant.

So, this would make these batteries cheaper to produce than lithium-ion batteries. Sodium-ion batteries also have some other advantages, like the fact that they work better in cold climates.

Traditionally, the problem with sodium-ion batteries has been energy density. That is, these batteries need to be bigger than lithium-ion batteries to get the same amount of charge. It’s why, along with the fact that there are worries about how many times we can charge these batteries, there’s always doubt as to whether these batteries could be used in electric vehicles where space is compact.

CATL has been working on developing these batteries for a while, and unveiled their first-generation sodium-ion battery pack in July 2021.

At the time, the company said the sodium-ion battery could achieve up to 160Wh/kg in energy density, lower than lithium iron phosphate batteries (LFP), which companies like Tesla have started to use in their standard range models since they’re cheaper and use no cobalt.

But CATL said that the next-gen sodium-ion battery would pass 200 Wh/kg and that it would start building a basic industrial chain by this year.

There aren’t too many details out yet, but if this is true, sodium-ion batteries could start competing with lithium-ion batteries in the lower-range end of the market.

https://www.moneymorning.com.au/20230419/the-great-battery-disruption.html

According to a policy paper by the OECD spanning the period 2009-20, the value of global trade in lithium recorded the biggest increase of all critical raw materials at 438%.

Other materials like natural graphite, manganese, cobalt, and rare earths all recorded growth rates higher than the average for all critical raw materials.

Source: OECD

Weaning the world off fossil fuels may switch one dependency for another:

‘While the green transition will reduce the global dependence on fossil fuels, it will intensify the pressure on the production and efficient international exchange of other raw materials.’

New report just dropped.

Earlier this month, the Organisation for Economic Cooperation and Development (OECD) released a 95-page trade policy paper titled ‘Raw Materials Critical For The Green Transition‘.

Despite the length, the paper has a niche focus: assessing the impact of export restrictions on critical raw materials for green technologies.

The paper’s lead authors find that export restrictions are playing a non-trivial role in international markets, affecting the availability and prices of these in-demand materials.

Mining may become big politics as countries seek secure supplies and producing nations seek leverage. As the lead authors note:

‘Global production of critical raw materials has become more concentrated amongst producing countries in the last decade and it tends to be more concentrated than their global imports and exports. This underscores the critical role of international trade and supply chains play in processing and delivering these materials to users but also indicates exposure to disruptions in upper segments of these supply chains. Production of critical raw materials is concentrated among a few producing countries, some of whom account for large shares of production of more than one critical raw material. The People’s Republic of China (hereafter “China”), for example, is among top three producers of six out of ten most production-concentrated critical raw materials, while Australia and Russian Federation (hereafter “Russia”) appear three times, and South Africa and Zimbabwe twice.

‘The global incidence of export restrictions on critical raw materials increased more than five-fold in the last decade, with several countries significantly intensifying use of these measures. In recent years, about 10% of global value of exports of critical raw materials faced at least one export restriction measure. The overall global economic impact of these measures can thus be sizable, even if the nature and magnitude of impacts is likely to be product and country-specific.’

Source: OECD

Vulcan’s second-last dot point in today’s announcement contained an interesting entailment.

Vulcan said its total capex for Phase One of its Zero Carbon Lithium Project development is around 1.5 billion euro. That’s around A$2.44 billion.

Vulcan plans to raise this amount on a debt to equity ratio of 65:35.

Meaning that Vulcan plans to raise an additional $850 million via equity raises. That’s a big sum — Vulcan’s current market cap, to be precise.

Do investors remember AnteoTech (ASX:ADO)?

AnteoTech was once a popular small-cap operating across a swathe of trending sectors like life science and energy. At one stage, the firm had a market cap over $800 million.

In April 2021, AnteoTech hit its peak, trading at 44 cents a share. Here’s its highlights from the March 2021 quarterly to give a sense of what the company was doing to warrant the market’s attention back then:

• ‘COVID-19 ART clinical study validated high Sensitivity 97.3% and Specificity 99.6%

• ‘CE Mark submission for COVID-19 ART and EuGeni reader completed. CE Mark registration received post the quarter end

• ‘Receipt of $1.4 million Queensland Government grant towards the development and commercialisation of the COVID-19 ART

• ‘Initial assessment of AnteoX completed by Collaborator 8 confirmed AnteoTech’s electrochemical performance enhancement’

Now, ADO trades at 3.6 cents a share, a drop of 92%.

Today, ADO released its March quarter business update.

It focused on AnteoTech’s revamped strategy aimed to ‘reduce the cash expenditure’. To shrink costs, AnteoTech cut its clinical studies on COVID products along with a portion of its staff.

But it did create a new executive position, that of a chief marketing officer, who will oversee the launch of a new website and branding later this year.

AnteoTech’s accounts tell quite a story, too.

Cash receipts from customers for the quarter totalled just $62,000, dwarfed by staff costs of $1.6 million. Net cash outflows from operating activities came in at $2.5 million, leaving the firm with $5.5 million in available funding.

If it didn’t receive $1.8 million from exercised options, AnteoTech would have just 1.4 quarters of funding available. That said, even with the injection from the exercise of options, AnteoTech has 2.2 quarters of funding available.

 

Lithium developer Vulcan Energy (ASX:VUL) provided a financing update for its Zero Carbon Lithium Project.

Vulcan said BNP Paribas, acting as its debt financial advisor, approached several export credit agencies (ECAs). According to Vulcan, these ECAs have ‘confirmed their in-principle support of Vulcan’s phase one project financing’.

As Vulcan explained, export credit agencies provide loan guarantees to de-risk commercial deals domestic firms may strike with external companies like Vulcan:

‘ECAs from different countries offer loan guarantees and insurance to help domestic companies limit the risk of selling goods and services in external markets and to specific projects. The ECAs debt guarantees means that they agree to pay a borrower’s debt (i.e.Vulcan) in the event that the borrower defaults on their obligation which facilitates the involvement of commercial banks in the financing process. The ECAs can offer both ‘tied’ financing (i.e. financing linked to a supply of goods or services from the ECA’s country) and ‘untied’ financing which is linked to a strategic interest for the ECA’s country.’

At this stage, the flagged support is really a confirmation of Vulcan’s eligibility for potential financing. For instance, the SACE — Italy’s ECA — ‘confirmed Vulcan’s project eligibility to their tied export credit program’.

This in-principle support is subject to certain conditions.

Vulcan aims to complete its debt and equity financing process by 1Q24.

Total capex for Vulcan’s phase one stage is estimated at €1.5 billion.

The lithium developer also said it is ‘in active discussions’ with strategic investors for equity investment in the Zero Carbon project.