5E Advanced Materials, Inc.

The Company recorded U.S. current income tax expense in connection with the Exchange during the fiscal year ended June 30, 2025. No U.S. federal or state income tax benefit was recorded for losses incurred during the year ended June 30, 2024. The Company has concluded that it is more likely than not that its deferred tax assets will not be realized which resulted in the recording of a full valuation allowance during those periods.

Domestic and foreign components of loss before income taxes for the years ended June 30 are as follows.

The provision for income taxes for the year ended June 30 are as follows:

The related payable for income tax expense has been recognized on the balance sheet within accounts payable and accrued liabilities.

The following table presents a reconciliation of the United States statutory income tax rate to the Company’s effective income tax rate for the periods presented.

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The significant components of the Company’s deferred taxes as of each date presented below are as follows.

As of June 30, 2025, the Company had U.S. federal, state, and Australian net operating loss (“NOL”) carryforwards of$67.7 million,$40.7 million and$14.6 million, respectively. As of June 30, 2024, the Company had U.S. federal, state, and Australian NOL carryforwards of$85.3 million,$74.0 million and$9.4 million, respectively. U.S. net operating loss carryforwards for the periods arising before December 31, 2018 have a 20 year carryforward, the earliest of which could expire in 2037. The amount of the post-tax reform U.S. federal NOL generated after tax year 2017 of approximately$66.8 million, can be carried forward indefinitely. California net operating losses have a 20-year carryforward, the earliest of which could expire beginning in 2037. Australia net operating losses can be carried forward indefinitely.

The utilization of the Company's net operating loss or tax attributes are subject to annual limitations in accordance with IRC section 382 and similar state provisions resulting from certain ownership changes that occurred. Such an annual limitation could result in the expiration of the attributes before utilization. The federal and state NOL carryforwards at June 30, 2025 have been reduced to reflect IRC section 382 ownership changes through June 30, 2025 and resultant inability to utilize a portion of the NOL prior to its expiration due to annual limitations.

The Company evaluates both the positive and negative evidence available to determine the realizability of its deferred tax assets. As of June 30, 2025 and 2024, the Company had a valuation allowance of$35.6 million and$39.4 million, respectively, of which both primarily relate to net operating losses and exploration costs.

Changes in the balance of the Company’s deferred tax asset valuation allowance for the periods presented are as follows:

The Company hadno unrecognized tax benefits as of June 30, 2025 or 2024. The Company recognizes interest accrued related to unrecognized tax benefits and penalties in its income tax provision, if applicable. The Company has not recognized any interest or penalties in the periods presented in these financial statements. The Company is subject to income tax in the U.S. federal jurisdiction, California and Australia. Tax years 2021 and forward remain subject to examination but there are currentlyno ongoing exams in any taxing jurisdictions.