GREEN LITHIUM REFINING LIMITED

Executive Summary

Green Lithium Refining Limited is an early-stage private company with a robust cash position and increasing equity, supported by government grants and capital raises. While liquidity appears sufficient to meet obligations, significant accumulated losses and reliance on grant funding introduce medium-term risks to operational sustainability. Recent director resignations and outstanding director loans warrant further inquiry to assess governance and financial stability.

GREEN LITHIUM REFINING LIMITED - Analysis Report

Company Number: 13137770

Analysis Date: 2025-07-29 20:50 UTC

1. Risk Rating: MEDIUM
   Justification: Green Lithium Refining Limited demonstrates positive net current assets and increasing shareholders’ funds over recent years, indicating growing equity and liquidity. However, the company holds a significant accumulated loss (P&L reserve negative £7.93m) and limited tangible fixed assets, reflecting an early-stage or development phase business with ongoing operational losses. The absence of an audit and reliance on government grants for income also add some risk factors.

2. Key Concerns:

• Accumulated Losses and Profitability: The company has substantial retained losses, suggesting it is not yet profitable and may rely on external funding or grants to sustain operations.
• Dependence on Government Grants: A notable portion of income arises from grants linked to innovation projects, which may not be sustainable long-term revenue sources. Delays or reductions in grants could impact liquidity.
• Director Turnover and Related Party Balances: Two directors resigned in 2025, shortly after the reporting date, which may indicate governance changes or instability. Additionally, director loans/advances totaling about £32.6k remain outstanding, which warrants monitoring for potential conflicts or financial strain.

3. Positive Indicators:

• Strong Cash Position and Net Current Assets: Cash of approximately £3.2m and net current assets of £1.95m as of January 2024 provide a healthy liquidity buffer to meet short-term obligations.
• Increasing Share Premium and Equity Base: Shareholders’ funds grew from £1.6m in 2021 to nearly £9.9m in share premium by 2024, reflecting successful capital raises and investor confidence.
• No Overdue Filings and Active Compliance: The company’s accounts and confirmation statements are filed on time, indicating regulatory compliance and good governance on reporting matters.

4. Due Diligence Notes:

• Review the detailed cash flow and funding plans, particularly how the company intends to transition from grant dependency to commercial profitability.
• Investigate the circumstances and implications surrounding the recent director resignations for stability and continuity of leadership.
• Examine the nature and terms of director advances and their impact on company finances or potential related party transactions.
• Assess the sustainability of government grants and any conditions attached that could affect future income recognition.
• Consider obtaining more detailed financial statements or forecasts to evaluate operational scalability and capital expenditure plans beyond the minimal tangible assets reported.