Mineral Resources Faces $896M Loss Amid Impairments and Market Pressures

A Year of Transition and Challenge

Mineral Resources Limited (ASX, MIN) has released its FY25 financial results, revealing a year marked by significant operational milestones alongside financial headwinds. The company’s revenue declined 15% to $4.5 billion, reflecting weaker iron ore and lithium prices that weighed on earnings. Underlying EBITDA also fell 15% to $901 million, underscoring the challenging commodity environment.

Despite these pressures, the ramp-up of the Onslow Iron project stands out as a highlight. The operation reached an annualised run rate of 35 million tonnes per annum (Mtpa) in August 2025, hitting its nameplate capacity ahead of schedule. This milestone positions Onslow Iron as a key cash-generating asset that will support Mineral Resources’ growth and balance sheet repair in the coming years.

Operational Strength Amid Market Volatility

The Mining Services division delivered record production volumes of 280 million wet metric tonnes, driving a 34% increase in underlying EBITDA to $737 million. This segment’s resilience was critical in offsetting softer commodity prices, with new contract wins and the inaugural earnings from the Onslow Iron Road Trust contributing to robust performance.

In contrast, the lithium segment faced ongoing market volatility. Production was adjusted to preserve value, with Mt Marion reducing output to focus on higher-grade material and Bald Hill placed into care and maintenance. Lithium prices fell sharply, with the weighted average achieved price down 39% year-on-year, pressuring earnings despite operational improvements at Wodgina and Mt Marion.

Financial Impact and Strategic Response

The statutory net loss after tax widened dramatically to $896 million, largely due to $632 million in impairment charges related to lithium assets and other tenements. These write-downs, while significant, were largely anticipated and reflect the company’s prudent approach to asset valuation amid market uncertainty.

Mineral Resources’ balance sheet remains robust, with liquidity exceeding $1.1 billion, though net debt increased to $5.3 billion following capital expenditure of $1.9 billion. The company elected not to declare a dividend, prioritising deleveraging and financial flexibility.

Looking Ahead, FY26 Guidance and Growth Prospects

Entering FY26, Mineral Resources is focused on operational momentum and disciplined capital allocation. Onslow Iron is expected to ship 17.1 to 18.8 million tonnes, with further capacity expansion planned. Mining Services anticipates volume growth of approximately 12.5%, reinforcing its role as a stable earnings pillar.

Capital expenditure guidance is set at $1.1 billion, balancing sustaining investments with growth projects such as the Lamb Creek deposit extension at the Pilbara Hub. The lithium business aims to improve cost structures and plant performance, positioning itself to benefit from any market recovery.

With a refreshed Board and governance framework, Mineral Resources is navigating a complex market landscape with a clear focus on strengthening its financial position and capturing long-term value for shareholders.