Pilbara Minerals shelves special dividend as lithium price dips

afr.com:

West Australian producer Pilbara Minerals has shelved plans to pay a special dividend or buy back its own shares after a steep fall in lithium prices last quarter.

The shares fell almost 4 per cent to $3.73. It reported a 42 per cent fall in revenue in the three months to September 30.

Pilbara Minerals CEO Dale Henderson. Trevor Collens

Pilbara Minerals has become the most shorted stock on the ASX as investors take a bearish view on lithium, at odds with the optimism of billionaires such as Gina Rinehart and the major global players vying for WA projects.

Dale Henderson-led Pilbara Minerals reported revenue of $493.1 million in the September quarter, from $868 million in the June quarter. The fall reflected a 31 per cent slide in the price received for its spodumene concentrate to $US2240 ($3552) a tonne and lower production.

Operating costs jumped 19 per cent to $747 a tonne as the company pushed ahead with a major expansion at Pilgangoora.

The company received an average price of $US4447 a tonne for spodumene concentrate over 2022-23 when it posted a net profit of $2.4 billion and flagged paying a special dividend or undertaking a share buy back.

Mr Henderson said demand for spodumene remained strong and that Pilbara Minerals had no trouble moving product.

Fellow producer Allkem, which is in the throes of a merger with processing specialist Livent aimed at creating a New York-listed $US10.6 billion lithium giant, also said demand had been softer than expected in the September quarter.

“Procurement activity has been conservative as customers have kept a wait-and-see approach, putting renewed downward pressure on lithium prices,” Allkem said as it reported record production from its Mt Cattlin mine in Western Australia.