IGO reports 18% jump in Q4 sales, misses core production estimates
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The news: Shares in IGO advanced in morning trade, outperforming the broader mining sector, following the critical miner’s fourth-quarter production results.
Shares rose 2.7% to $6.93 at 11:56am AEST, while the broader materials sector had fallen 2.2%.
The numbers: IGO has reported an underlying group EBITDA of $286 million in FY26, 10% below market consensus of $316 million, according to Visible Alpha.
This was driven by the Kwinana lithium hydroxide refinery, which suffered an EBITDA loss of $167 million during the fourth quarter.
Group sales rose 18% quarter-on-quarter to $141.4 million in the June quarter, bringing the FY26 total to $448.9 million.
The miner generated free cashflow of $134 million in FY26, 10% below the market consensus of $150 million, while net cash as of 30 June reached $387 million, which was 10% short of the $436 million consensus expectation.
The context: RBC Capital Markets analyst James Redfern holds a “sector perform” view on IGO with a price target of $10, stating that most of the miner’s core production metrics came in below consensus forecasts.
Redfern added that the total lithium hydroxide production reached 8,800 tonnes in FY26, which came in 12% below consensus guidance in the fourth quarter, due to a major planned shutdown designed to implement two major capital projects to improve plant performance.
A further shutdown is planned for July and August to commission a calciner off-gas treatment system, which will reduce production for the September quarter.
The miner projects its FY27 spodumene production to be in the range of 1,550 kilo tonnes to 1,750 kilo tonnes, below the market consensus of 1,675 kilo tonnes, while its FY27 lithium hydroxide production is guided at between 9,000 and 11,000 tonnes, below the consensus estimate of 12,000 tonnes.
The sources: ASX, RBC Capital Markets research
