Leading Edge Materials Corp. reported a net loss of $882,239 for the three months ended July 31, 2026, down from a net loss of $1,357,598 in the prior quarter ended April 30, 2026. The company also closed the second tranche of its private placement, issuing 1,100,000 common shares at $0.25 per share for gross proceeds of CAD$275,000.

Quarterly financial performance

The quarter-on-quarter improvement in net loss was driven by lower share based compensation of $285,658 in Q3FY26, compared to $804,590 in Q2FY26. On a year-over-year basis, the net loss widened from $611,307 in the three months ended July 31, 2025, with the increase of $270,932 attributed to higher share based compensation of $285,658 (versus $208,322 in Q3 2025) and professional fees of $46,632 (versus $10,588 in Q3 2025).

The following table presents selected financial data derived from the company's unaudited condensed consolidated interim financial statements prepared in accordance with IFRS.

As of July 31, 2026, the company held working capital of $1,724,001 and carried an accumulated deficit of $55,555,007. Total assets stood at $31,338,835, up from $29,852,958 at April 30, 2026.

Private placement and capital resources

On July 12, 2026, the company announced a non-brokered private placement of up to 24,000,000 units at C$0.25 per unit for gross proceeds of up to C$6,000,000, with cornerstone shareholder Eric Krafft agreeing to subscribe for any units not otherwise taken up. On August 18, 2026, the company closed the first tranche, issuing 16,032,000 common shares for gross proceeds of C$4,008,000.

The second tranche, announced alongside these quarterly results, involved the issuance of 1,100,000 common shares at $0.25 per share for gross proceeds of CAD$275,000. Each unit consists of one common share and one common share purchase warrant, with each warrant entitling the holder to purchase one common share at C$0.40 per warrant share until two years from the closing date. A finder's fee of 6% was paid to an arm's length third party on a portion of the private placement. The securities are subject to a hold period expiring on January 18, 2027, pursuant to applicable Canadian securities laws. The TSX Venture Exchange has approved an extension of the closing of the private placement to on or before September 25, 2026, subject to receipt of all required regulatory approvals.

Net proceeds are intended to fund Pre-Feasibility Study workstreams and environmental permitting at Norra Kärr, studies related to a possible restart of the Woxna Graphite mine and processing plant, and general working capital for the next twelve months.

Key operational highlights during and after the quarter

Several material developments occurred during and after the three months ended July 31, 2026:

• On May 26, 2026, the company agreed to increase its stake in the Bihor Sud Exploration Licence joint venture to 90%, following an amendment to the shareholders joint venture agreement originally entered into with REMAT Group Management SRL on August 9, 2018.
• On June 9, 2026, testwork on ore from the Woxna Graphite Mine using a two-stage alkaline process achieved 99.96% LOI (loss on ignition), suggesting a preferred route for commercial scale-up.
• On June 28, 2026, wholly owned Swedish subsidiary GREENNA Mineral AB was granted an Exploitation Concession, a 25-year mining lease, for the Norra Kärr Heavy Rare Earth Elements Project in Sweden.
• On July 12, 2026, the company announced the intent to complete a non-brokered private placement of 24,000,000 units at C$0.25 per unit for aggregate gross proceeds of up to C$6,000,000.
• On August 18, 2026, the company closed the first tranche, issuing 16,032,000 common shares at $0.25 per share for gross proceeds of CAD$4,008,000.
• On September 7, 2026, the company announced a first-pass diamond drilling programme at Woxna, commencing September 8, 2026, designed to test whether three graphite occurrences represent parts of the same larger regional graphite-bearing system.

Norra Kärr and Woxna project updates

The grant of the 25-year mining lease for Norra Kärr K Nr. 2 on June 28, 2026, followed the March 2026 recommendation of the Mining Inspectorate and the December 2025 endorsements of the County Administrative Boards of Jönköping and Östergötland. The Geological Survey of Sweden has confirmed Norra Kärr as one of Europe's richest rare earth elements deposits, with a high proportion of heavy rare earth elements including terbium, dysprosium, and yttrium. The 2021 Preliminary Economic Assessment estimated production levels of 248tpa Dysprosium and 36tpa Terbium oxides over a 26-year mine life. The project carried a pre-tax NPV10 of over US$1B in the 2021 PEA. Edison Research values Norra Kärr at US$1.8bn on an unrisked NPV10 basis, or US$0.9bn risk-weighted.

The Woxna Graphite Mine is being maintained on a production-ready basis. The company is updating an internal production restart study in partnership with an engineering consultant. The first-pass diamond drilling programme consists of five holes testing the Kringeltjärn, Råttjärnamyren, and Svartboberget graphite occurrences.

Financial outlook and going concern

The report for the nine months ending October 31, 2026, is expected to be published on or about January 22, 2027. The company's financial statements are prepared on a going concern basis in accordance with IFRS Accounting Standards. The recoverability of the carrying value of long-lived assets remains dependent on the company's ability to preserve its interest in underlying mineral property interests, the discovery of economically recoverable reserves, the achievement of profitable operations, and the ability to obtain financing to support ongoing exploration programmes and mining operations. Additional capital will be required to recommence operations at the Woxna Graphite Mine and to fund future development of the Norra Kärr property.

Leading Edge Materials Corp (TSXV: LEM) will commence a diamond drilling programme on September 8, 2026, at its Woxna Graphite Project in Sweden. The initiative aims to test whether three separate graphite occurrences form a single, larger regional system.

The five-hole programme targets Kringeltjärn’s eastern extension, Råttjärnamyren, and Svartboberget. Management believes these sites are not isolated pockets but parts of a connected mineralisation trend. Historical drilling at Svartboberget previously intersected a thick graphite-bearing sequence at depth.

Testing a Regional System

The hypothesis relies on two lines of historical evidence. First, earlier drilling confirmed significant graphite presence at Svartboberget. Second, reinterpreted geophysical data from the 1980s and 1990s highlight conductive anomalies across all three areas.

Graphite is highly conductive, making these anomalies priority targets. Slingram electromagnetic data suggest a conductive trend continuing from Råttjärnamyren toward Svartboberget. Additional data define shallow targets between Svartboberget and known mineralisation at Kringeltjärn, indicating potential bedrock exposure that has not yet been drill-tested.

Strategic Context

Woxna hosts one of the few fully built and permitted natural flake graphite mines in Europe, centred on the Kringelgruvan open pit and processing plant. Positive results could justify a larger follow-up campaign and add to the resource growth potential.

Global demand for natural flake graphite is forecast to rise from around 1.3 million tonnes in 2026 to approximately 2.7 million tonnes by 2036. China currently dominates the supply chain, accounting for roughly 70% of global mine production and over 90% of anode manufacturing capacity.

Regulatory Backdrop

China suspended its graphite dual-use export controls on November 9, 2025, with the suspension expiring on November 27, 2026. This easing of trade tensions has not altered the structural reliance on Chinese supply that concerns European and North American battery makers.

The European Union has set a target under the Critical Raw Materials Act to source at least 10% of its strategic raw material consumption domestically by 2030. The Swedish Government’s new Mineral Strategy also places critical raw materials at the centre of national security policy.

Private Placement Update

Leading Edge Materials received approval from the TSX Venture Exchange to extend the closing of its non-brokered private placement. The company now expects to close on or before September 25, 2026, subject to regulatory approvals. Terms remain unchanged from previous announcements.

Proceeds will advance projects in Sweden and Romania, including general working capital. Specifically, funds will support Pre-Feasibility Study workstreams and environmental permitting for the Norra Kärr Heavy Rare Earth Elements Project, which recently secured a 25-year mining lease. Funds will also support studies related to a possible restart of the Woxna Graphite mine.

What the Numbers Show

The market dynamics reveal a stark supply-demand divergence. While global demand for natural flake graphite is projected to more than double within a decade, rising from 1.3 million tonnes in 2026 to 2.7 million tonnes by 2036, supply remains heavily concentrated. With China controlling roughly 70% of mine production and over 90% of anode manufacturing, the structural gap underscores the strategic value of non-Chinese assets like Woxna, particularly as the EU mandates 10% domestic sourcing by 2030.