Kathleen Valley Ships 81,341 dmt Spodumene, Generates $16.7M Net Operating Cash

Strong Operational Momentum at Kathleen Valley

Liontown Resources Limited (ASX: LTR) has delivered a compelling performance in the December 2024 quarter, marking a significant milestone in the ramp-up phase of its Kathleen Valley Lithium Operation. The company shipped 81,341 dry metric tonnes (dmt) of spodumene concentrate, contributing to a total of over 100,000 wet metric tonnes shipped since production commenced in July 2024.

This operational momentum translated into solid financial outcomes, with net cash from operating activities reaching $16.7 million and revenue of $89.8 million. The average realised price of US$806 per dmt SC6e reflects strong market demand, including premium spot sales and foundational offtake agreements, notably the first shipment to LG Energy Solution.

Cost Management and Business Optimisation

Despite operating in a challenging low-price lithium environment, Liontown has demonstrated disciplined cost management. Unit operating costs (FOB) stood at A$1,000 per dmt SC6e sold, with an All In Sustaining Cost (AISC) of A$1,170 per dmt SC6e. The company has provided guidance for H2 FY25 unit operating costs to fall between $775 and $855 per dmt SC6e, anticipating further optimisation as production volumes increase and fixed costs are diluted.

In response to market conditions, Liontown updated its mine plan to focus on higher-productivity underground areas, targeting a sustainable production rate of 2.8 million tonnes per annum by FY27. This strategic pivot aims to reduce development and fixed costs, with up to $100 million in cost reductions and deferrals identified through the Business Optimisation Program.

Advancing Underground Mining and Processing

Underground mining development is progressing well, with a record 1,902 metres developed in the quarter and 32,000 tonnes of clean ore mined. Preparations for the transition from open pit to underground mining remain on track for FY26, supported by completed infrastructure projects such as ventilation and paste plants.

Processing plant ramp-up continues to exceed expectations, with 619,000 dmt of ore processed and an average lithia recovery improving to 55% for the quarter, reaching 59% in December. Plant availability averaged 89%, with December achieving a near steady-state availability of 92%. The Kathleen Valley Hybrid Power Station also maintained strong performance, delivering 82% renewable power penetration during the quarter.

Sustainability and Community Engagement

Liontown remains committed to safety and sustainability, recording a Lost Time Injury Frequency Rate (LTIFR) of 0.66 and a Total Reportable Injury Frequency Rate (TRIFR) of 4.59. The company continues to foster strong relationships with Native Title groups and local communities, awarding contracts to Tjiwarl businesses and supporting community initiatives.

Environmental approvals progressed with the receipt of Section 18 approval for the Mt McClure bore field pipeline, underpinning ongoing mining and processing activities.

Financial Position and Outlook

At quarter-end, Liontown held $192.9 million in cash and $12.1 million in trade receivables, alongside nearly 25,000 dmt of saleable concentrate inventory. Capital expenditure of approximately $45 million was invested in project construction, including the paste fill plant and tantalum circuit, with remaining capital payments expected in H2 FY25.

With commercial production declaration anticipated in the March 2025 quarter, Liontown is poised to transition fully into steady-state operations. The company’s strategic focus on operational excellence, cost discipline, and market engagement positions it well to navigate current market challenges and capitalize on the accelerating global demand for lithium.