DECEMBER 2021 HALF-YEAR FINANCIAL REPORT

PLS has announced an inaugural interim profit after tax of $114.0M for the half-year to 31 December 2021 (half-year). The result reflect a sustained improvement in lithium market conditions over the period, which has continued its strong momentum into the current half. 

The profit result was underpinned by an operating gross margin1 from the Pilgan operation of $172.1M (1H FY2020: $13.2M), with the $158.9M improvement in gross margin achieved as a result of:

• Shipping 170,228 dmt of spodumene concentrate.
• Achieving an average selling price of ~US$1,250/dmt (~A$1,700/dmt).
• Demand for and pricing of lithium chemicals and spodumene concentrate increased significantly during the period, resulting in record revenue of $291.7M (1H FY2020: $59.1M).
• Since the end of the half-year pricing has continued to increase with price reporting agencies currently indicating spot spodumene concentrate prices in the range of ~US$3,750-4,500/dmt2 .
• Delivering unit operating costs (CFR China)3 of US$486/dmt (A$666dmt), which were affected by: 
• Increased royalty costs associated with significantly higher market pricing and higher sea-freight costs than historical norms, and
• Lower spodumene production rates due to plant down-time events (both scheduled and unplanned), less than optimal ore feed blend being presented to the plant due to mining constraints resulting in lower overall spodumene recovery (~65%) and the lack of key operating and maintenance personnel in the current tight labour market. 

Commenting on the half year results, Pilbara Minerals’ Managing Director, Ken Brinsden said:

“We are very pleased to announce an outstanding inaugural profit for the half-year to 31 December, which marks a significant milestone for Pilbara Minerals in our journey to become one of the world’s leading suppliers of lithium raw materials.

“Our financial performance for the period is a direct reflection of the incredible turnaround which has been experienced in the lithium raw materials supply chain over the past year or so. The combination of strong underlying demand growth and Pilbara Mineral’s ability to create a transparent spot price outcome via the Battery Material Exchange has driven very strong increases in prices for our product.

“I am very proud of the efforts of the entire Pilbara Minerals team in striving to capitalise on these fantastic market conditions. As previously disclosed, the half-year has not been without its significant operational and technical challenges – due to a combination of plant down-time events, the integration of a new plant at Ngungaju and the widespread labour shortage issues and cost inflation being experienced in the WA resource sector.

“Despite these challenges, the outlook for Pilbara Minerals in the second half of FY2022 and beyond remains extremely bright. The current momentum in lithium markets continues to demonstrate higher price outcomes and we are very well placed to participate in this as production and sales volumes from the combined Pilgangoora Operation continue to increase. I am confident that a combination of hard work, innovation and focus on production growth will continue to drive our success.”