Liontown Posts $137M Net Cash Flow and Sets Stage for FY27 Production Surge

Record Underground Development Drives Production Growth

Liontown Limited (ASX:LTR) delivered a standout June quarter with underground mining development hitting a record 3,316 metres, a 35% increase quarter-on-quarter. This surge in development is critical as it opens new mining fronts and builds the flexibility needed to ramp up underground ore mining to a targeted 2.8 million tonnes per annum (Mtpa) by the end of FY27. The company maintained a steady underground ore grade of 1.4% Li2O, mining 356 kilotonnes during the quarter, and averaged a 1.5 Mtpa mining rate in the second half of FY26.

Strong Financial Performance Amid Robust Lithium Prices

The quarter generated $137 million in net cash flow, lifting Liontown's cash balance to $561 million and underpinning its financial strength. Revenue reached a quarterly record of $235 million, driven by 108,489 dry metric tonnes (dmt) of spodumene concentrate sold at an average grade of 5.0% Li2O and an average realised price of US$1,880 per dmt (SC6e CIF). Operating costs remained stable at A$995 per dmt sold (FOB), despite inflationary pressures including increased diesel costs linked to geopolitical tensions in the Middle East.

Processing Plant Efficiency and Recovery Improvements

Processing volumes increased to 647 kilotonnes of ore at an average lithia feed grade of 1.3% Li2O, with plant availability steady at 92%. Lithium recovery improved to 63%, the best quarterly result for FY26, benefiting from a higher proportion of cleaner underground ore in the feed blend. Contamination from open-pit ore remains a challenge, but ongoing optimisation efforts aim to maximise recovery rates, which can reach 70% when processing predominantly underground ore.

Expansion Study Progressing Toward Final Investment Decision

Liontown is advancing its Kathleen Valley expansion study with early works well underway, including procurement of a 5.5 MW ball mill and construction of a permanent Mine Services Area. Development at the North-West Flats underground area has commenced, with grade control drilling and portal recommissioning in progress. The company expects to make a Final Investment Decision (FID) on the expansion by the end of Q1 FY27, supported by a robust cash position and strong market fundamentals.

FY27 Guidance Reflects Investment in Growth and Operational Scale-Up

For FY27, Liontown forecasts spodumene concentrate production between 390 and 440 kilotonnes, unit operating costs of A$1,050 to A$1,250 per dmt sold, and total capital expenditure of A$320 to A$370 million. This guidance includes sustaining capital, ramp-up development to reach 2.8 Mtpa, and early works for expansion, all funded from operating cash flow. The company plans for production growth to begin in Q2 FY27, with increased equipment and multiple mining fronts enhancing productivity and flexibility.