5E Advanced Materials Inc. Q1 FY2026 earnings call

Paul Weibel highlighted that fiscal 2026 is a pivotal year for 5E. Boron was added to the U.S. Critical Minerals list, validating the importance of Ford Cady as the leading advanced stage boron project in the U.S. This designation expands eligibility for federal funding programs like USXM, DOE Loan Programs Office, etc. Key highlights include continued customer validation with full-scale product testing by Tier 1 specialty glass manufacturers, progress on feed engineering with an application to the XM engineering multiplier program for a $10 million loan facility, and being on track for a final investment decision in 2026. The broader borates market has tight supply and demand with demand outpacing supply in sectors like EVs, wind, etc. 5E is uniquely positioned to fill the market deficit. Operationally, the team has qualified high-purity boric acid with multiple customers, shipped 20 tons of boric acid to Taiwan for testing, supplied to a domestic boron carbide manufacturer, and is preparing additional shipments. Priorities for fiscal 2026 include securing non-dilutive U.S. capital support through various programs, advancing customer agreements for commercial offtake contracts, executing feed and FID work streams, upgrading mineral resource statement, and building IP portfolio.

5E is on track towards a final investment decision in 2026. The remainder of fiscal year 2026 will focus on securing non-dilutive U.S. capital support through programs like XM, OSC, DFC and DOE, advancing customer agreements with detailed negotiation of offtake contracts expected before year-end, and executing feed and FID work streams to be construction ready in 2026.

Q: Tate Sullivan asked if there's word from the Defense Logistics Agency about government stockpiling boron or its derivatives.

A: Paul Weibel said the trend was stockpiling carbide before, but not sure about current stockpiling, but the plan is to domesticate the boron carbide supply chain as it's dominated by China.

Q: Tate Sullivan asked about horizontal wells drilling.

A: Paul Weibel said it's to validate the commercial design, with 4 injection recovery wells and 2 horizontal laterals drilled, results showing good variance reduction and higher efficiency, helping with feed engineering and commercial plant design.

Q: Unknown Analyst asked about percentage or dollar terms of government program support.

A: Paul Weibel said the critical minerals designation opens up capital structure possibilities, with $435 million capital estimate, and can now have in-depth discussions on loans and equity, running parallel processes for debt and potential OSC capital.

Q: Unknown Analyst asked about fluctuating head grades geologically.

A: Paul Weibel explained it's about boron percentage in solution from leaching colemanite with HCL, lab testing shows HCL reaction, base case assumes 9%-10% head grade, and they're bedding out commercial design with downhole heaters on order.

Q: Dmitry Silversteyn asked about offtake contracts and production percentage.

A: Paul Weibel said they pitched 20% of production for offtake, aiming for 70%-75% of production under offtake agreements, with 25%-30% for spot market.

Q: Dmitry Silversteyn asked about timeline for final decision.

A: Paul Weibel said it's reference to calendar year 2026