This morning, Li-Cycle Holdings Corp.’s (NYSE: LICY) stock is rising sharply due to recent operational and financial achievements. Pre-market trading saw LICY shares climb 45.43% to $5.25 after the company’s third-quarter results were announced, indicating investor confidence in the company’s progress toward resuming its Rochester Hub project and attaining sustainable growth.
Progress in Rochester Hub Project and Funding Milestones
Li-Cycle (LICY) has made significant progress in getting its Rochester Hub back up and running. LICY recently negotiated an additional $475 million financing agreement with the US Department of Energy (DOE) to secure the project’s financial viability.
Li-Cycle also developed a commercial framework for mixed hydroxide precipitate (MHP) off-take agreements to complement its existing lithium carbonate off-take agreements. These developments will support the company in optimizing its Spoke facilities, aiming to create a self-sufficient Spoke business while securing full funding for the Rochester Hub’s restart.
Financial Performance and Operational Efficiency
Li-Cycle equaled the previous quarter’s record with revenues of $8.4 million in Q3, a 79% year-over-year growth. Notable cost-cutting measures included a 50% reduction in marketing, general, and administrative expenses to $12.9 million. This reduction was largely achieved through strategic cash preservation measures, enabling Li-Cycle to better allocate resources toward operational growth and project financing.
Endorsements and Support from Key Partners
The DOE loan agreement, secured through the Advanced Technology Vehicles Manufacturing (ATVM) program, underscores confidence in Li-Cycle’s business model and technology. With a 15-year term and favorable interest rates, the facility requires certain milestones to be met, including a base equity contribution (BEC) and reserve account funding. Li-Cycle is also required to settle $92 million in incurred costs and fund an additional $173 million in reserve requirements before the first advance by November 2025.
Securing Additional Funding and Strategic Alternatives
To meet these financial conditions, Li-Cycle is actively exploring further financing options and strategic partnerships. This comprehensive funding package is expected to help satisfy conditions under the DOE loan, enabling the restart of the Rochester Hub construction and supporting general corporate objectives. As LICY moves forward, it aims to solidify its role in the electrification transition and long-term operational success.