Jervois Global : Half Yearly Report and Accounts to 30 June 2023

Jervois Global Limited

INTERIM CONDENSED FINANCIAL REPORT

FOR THE HALF-YEAR ENDED

30 JUNE 2023

JERVOIS GLOBAL LIMITED AND CONTROLLED ENTITIES

TABLE OF CONTENTS

Corporate Directory	1
Directors' Report	2
Lead Auditor's Independence Declaration	8
Condensed Consolidated Statement of Financial Position	9
Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income	10
Condensed Consolidated Statement of Changes in Equity	11
Condensed Consolidated Statement of Cash Flows	13
Notes to the Condensed Consolidated Financial Statements	14
Directors' Declaration	41
Independent Auditor's Review Report	42

JERVOIS GLOBAL LIMITED AND CONTROLLED ENTITIES

Corporate Directory

Directors

Bryce Crocker (Chief Executive Officer)

Peter Johnston (Non-Executive Chairman)

Brian Kennedy (Non-Executive Director)

Michael Callahan (Non-Executive Director)

David Issroff (Non-Executive Director)

Daniela Chimisso Dos Santos (Non-Executive Director)

Company Secretary

Alwyn Davey

Principal Address and Registered Office

Suite 2.03, 1-11 Gordon Street,

Cremorne, Victoria, 3121, Australia

ABN

52 007 626 575

Auditors

Ernst & Young

8 Exhibition Street,

Melbourne, Victoria, 3000, Australia

Bankers

ANZ Banking Group Limited

Level 1

420 St Kilda Road

Melbourne, Victoria, 3004, Australia

Share Register

Computershare Investor Services Pty Ltd

452 Johnston Street

Abbotsford, Victoria, 3067, Australia

Computershare Investor Services Inc

510 Burrard Street

Vancouver, BC, V6C 3B9, Canada

Stock Exchange Listing

Jervois Global Limited shares are listed or traded on the:

• Australian Securities Exchange (ASX code: JRV)
• TSX Venture Exchange (TSX-V code: JRV)
• United States OTCQX (OTCQX code: JRVMF)

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JERVOIS GLOBAL LIMITED AND CONTROLLED ENTITIES

Directors' Report

The Directors present their report, together with the financial statements, on the consolidated entity consisting of Jervois Global Limited ("Jervois" or the "Company") and the entities it controlled (together referred to as the "Group") at the end of, or during, the six-month period ended 30 June 2023 (the "period").

1. Directors

The following persons were Directors of Jervois during the whole of the period and up to the date of this report, unless otherwise stated:

Name	Role
Bryce Crocker	Chief Executive Officer
Peter Johnston	Non-Executive Chairman
Brian Kennedy	Non-Executive Director
Michael Callahan	Non-Executive Director
David Issroff	Non-Executive Director
Daniela Chimisso Dos Santos	Non-Executive Director

2. Principal activities

The principal activities of the Group during the period were cobalt refining, advanced chemical and powder manufacturing and associated commercial activities including product sales, in combination with mine construction and engineering for a refinery restart.

3. Review of operations

The total loss after tax of the consolidated entity attributable to the owners of the parent entity for the half-year ended 30 June 2023 was US$93.945 million (30 June 2022: profit after tax of US$2.854 million).

During the period, focus has been on the ongoing operations at Jervois Finland, progressing construction of, and underground mining at, the Idaho Cobalt Operations ("ICO") in the United States ("U.S."), prior to its suspension in late March 2023, and the engineering for the restart at the São Miguel Paulista ("SMP") nickel and cobalt refinery ("SMP Refinery") in São Paulo, Brazil.

The business has been impacted by the current cyclical weakness in the cobalt market and the Group has adjusted its priorities to ensure long-term resilience and sustainability across the asset base.

The key priorities for the period to 30 June 2023 and for the rest of the year include:

• Consolidate the Jervois Finland turnaround and continue to improve EBITDA and cash generation.
• Maximise restart optionality at ICO whilst ensuring the suspension phase remains cost effective.
• Advance debt and partnership funding options for SMP Refinery.
• Asset portfolio review and optimisation including divestiture of the Nico Young nickel-cobalt laterite project.
• Execute U.S. Government funded ICO drilling and complete domestic refinery studies; advance U.S. Government funding applications, including the Advanced Technology Vehicle Manufacturing loan for a U.S. cobalt refinery.

Management is focussed on ensuring the Company has a stable foundation for the medium- to long-term future of the Group. Even at current low cobalt prices, Jervois has a pathway to implement this strategy.

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JERVOIS GLOBAL LIMITED AND CONTROLLED ENTITIES

Directors' Report

Capital raising

On 28 June 2023, the Company announced the launch of a US$50.0 million total capital raising (the "Capital Raising"), comprising:

• US$25.0 million Unsecured Convertible Notes ("Notes") maturing in July 2028, and which are convertible into Jervois ordinary shares ("Convertible Notes Offer"). The initial conversion price for the Notes represents a 40% premium to the Entitlement Offer Theoretical Ex Rights Price and the Notes carry a 6.5% per annum coupon; and
• US$25.0 million fully underwritten 1 for 3.34 accelerated non-renounceable entitlement offer (the "Entitlement
  Offer"), undertaken in parallel with the Convertible Notes Offer.

Net proceeds from the Capital Raising will strengthen Jervois' balance sheet, improve liquidity and working capital flexibility, with cash also being applied to debt reduction.

Jervois shares were issued under the Institutional Entitlement Offer on 7 July 2023, raising A$20.2 million (~US$13.5 million). The Institutional Entitlement Offer was supported by new and existing domestic and offshore institutional investors. The Retail Entitlement Offer closed on 18 July 2023 and raised a further A$17.2 million (~US$11.5 million).

The first tranche of the Notes was completed on 18 July 2023 with the receipt of US$19.9 million. The second tranche of the Notes (US$5.1 million) is anticipated to be issued following Jervois shareholder approval on 28 August 2023.

The Group expects the Notes will be classified as a compound financial instrument under AASB 9 - Financial Instruments, and expects a large portion of the Notes to be classified as a debt instrument within the Group's consolidated statement of financial position upon recognition.

Jervois Finland, Finland

Jervois Finland produces products for a range of markets including chemicals, catalysts and ceramics, powder metallurgy and batteries.

During 1H 2023, Jervois Finland produced 2,449 metric tonnes with challenging conditions during the period in relation to cost pressures from consumables and the current cyclical weakness in the cobalt market.

The Jervois Finland business achieved revenue during the period of US$114.259 million, a 42% decrease over the corresponding prior period, with this decrease driven by lower cobalt prices. This revenue was generated via cobalt sales volumes of 3,160 metric tonnes. Jervois Finland's Adjusted EBITDA (i) for 1H 2023 was negative US$7.748 million.

During the period, the Group commenced a Bankable Feasibility Study ("BFS") to expand cobalt refinery capacity at the Kokkola Industrial Park in Finland. Due to the U.S. Inflation Reduction Act and associated government support programmes, this has been redirected across for a greenfield cobalt refinery in the U.S. and the BFS is now expected be completed based on this new location. Jervois Finland's technical team and engineering and consulting company AFRY Finland Oy ("AFRY") have designed a BFS flowsheet for an initial refinery capacity of 6,000 metric tonnes per annum of contained cobalt in sulphate, the physical form required for the battery industry, including for electric vehicles.

AFRY will continue to provide specialist refinery expertise and leadership from Finland, but with the BFS to be run out of AFRY USA LLC. Jervois USA's team in Salmon, Idaho, will provide specialist support for the U.S. BFS across key areas such as environment and permitting, logistics, utilities, and construction readiness. Jervois Finland will continue to provide technical stewardship of the BFS.

1. Adjusted EBITDA represents earnings before interest, tax, depreciation, and amortisation ("EBITDA"), adjusted to exclude items which do not reflect the underlying performance of the Group's operations. Exclusions include gains (or losses) on sale of fixed assets, impairment charges (or reversals), inventory write-downs to net realisable value (or reversals), study costs, certain derivative items, and one-off acquisition and integration costs.

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