Northern Graphite Announces Second Quarter 2025 Results and Provides Corporate Update
Executive Summary
- Northern Graphite secured up to C$6.225 million in interest‑free, unsecured government financing to fund a pit extension at the Lac des Îles mine.
- Q2 2025 revenue rose 28% to $7.0 M, with graphite concentrate sales increasing to 3,404 t; however, cash costs rose 19% and the company posted a net loss of $1.0 M (‑$0.01 per share).
- The Battery Materials division received an initial US$1.5 M licensing payment (total potential US$7 M) for its carbon material processing technology, with further payments and royalties expected through 2027.
Key Details
- Government Financing:
- Up to C$6.225 million contribution from Natural Resources Canada & Economic Development Agency of Canada for Quebec Regions.
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Interest‑free, unsecured; will finance 75% of eligible pit‑extension costs; repayment starts 36 months after project completion (84 equal monthly installments).
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Operating Highlights:
- Concentrate production Q2: 2,142 t (up from 1,211 t in Q1 after mill shutdown).
- Strong industrial demand; higher pricing negotiated for 2025.
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License agreement for carbon material processing technology – US$1.5 M received, additional US$5.5 M expected in 2025, plus minimum royalty payments of US$1 M in each of 2026 and 2027.
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Financial Highlights (Q2 2025 vs Q2 2024):
- Revenue: $7.0 M (+28%).
- Graphite sold: 3,404 t (up from 2,772 t).
- Average realized price: +4% YoY.
- Cash cost per tonne: US$1,850 (+19%).
- Mine‑operation loss: $1.6 M (vs $0.1 M gain prior year).
- G&A expenses: $1.8 M (down from $1.9 M).
- License revenue: $2.0 M (previously nil).
- Finance costs: $2.8 M (down from $3.0 M); largely non‑cash.
- Foreign exchange gain: $4.3 M vs loss of $0.6 M prior year.
- Impairments: inventory write‑downs $0.8 M total.
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Net loss: $1.0 M (‑$0.01/share) vs net loss $9.4 M a year earlier.
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Liquidity & Debt:
- Senior secured loan: $26.0 M outstanding; royalty financing: $15.4 M.
- Covenant breaches waived (interest accrued, working‑capital, cash‑balance).
- Cash & equivalents: $2.1 M (up from $0.3 M Q1).
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Working capital deficit: $41.2 M as of June 30 2025.
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Strategic Projects & Partnerships:
- Collaboration with BMI Group to evaluate brownfield site for Baie‑Comeau Battery Anode Material plant (potential capex reduction).
- Okanjande (Namibia) project slated for restart H1 2027, funded via royalty/stream/debt or strategic equity partner.
- EU Critical Raw Materials Act “Strategic Project” status for upgrading Okanjande graphite to Battery Anode Material in France.
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Agreement with Graphano Energy to share technical knowledge on LDI and adjacent properties.
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Regulatory / Trade Environment:
- U.S. Commerce Department imposed preliminary countervailing duties (up to 721%) and anti‑dumping duties (93.5%) on Chinese graphite AAM, resulting in effective tariffs >160%.
Notable Quotes
“This is a major step forward… the government recognized not only the importance of Lac des Îles, but that the Company needed help to drive it forward.” – Hugues Jacquemin, CEO
“The world is waking up to the urgency and opportunity in critical minerals… we are confident Northern will be a leading beneficiary.” – Hugues Jacquemin, CEO