Arcadium Lithium shares fall on Q3 earnings slide
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More news: Shares in Arcadium Lithium lowered at market open on the ASX after the lithium miner posted a sharp fall in earnings and revenue in the third quarter.
Arcadium shares were down 1.95% to $8.06 in early trading, having gained more than 30% since announcing its $9.9 billion acquisition by Rio Tinto last month.
It was the second-worst performing stock across the ASX 200 in a strong market.
Arcadium Lithium posts Q3 earnings slide
The news: Arcadium Lithium posted a sharp fall in earnings and revenue for the third quarter, after announcing its $9.9 billion acquisition by Rio Tinto last month.
The numbers: Arcadium Lithium reported Q3 revenue of $203.1 million, down from $255 million in the previous quarter. Attributable net income was $16.1 million, down from $85.1 million quarter on quarter.
Adjusted EBITDA fell from $99.1 million in Q2 to $42.9 million in Q3, with decline attributed to lower average realised prices and lower volumes, in addition to higher costs.
The company realised average pricing of $16,200 per product metric ton for combined lithium hydroxide and carbonate volumes in the third quarter, compared to $17,200 in the second quarter.
The context: Arcadium Lithium noted that average realised price declined across most lithium products during the quarter, due to weaker market prices and customer and product mix. However, lithium hydroxide pricing was roughly flat quarter over quarter, the company said, supported by existing long term commercial agreements.
Last month, Arcadium Lithium agreed to an acquisition by Rio Tinto. The company said it expects the deal to close in mid-2025.
What they said: "We continued to deliver strong average realised pricing in a challenging market in the third quarter, supported by our commercial strategy in lithium hydroxide which focuses on long term strategic customers," Arcadium Lithium president and CEO Paul Graves said.
On the Rio Tinto acquisition, Graves said: "We are confident that this is a compelling cash offer that reflects the full and fair long-term value for our business and de-risks our shareholders' exposure to the execution of our development portfolio and market volatility".
The source: ASX announcement
