Lynas Rare Earths shares slump after lifting capital expenditure for Malaysian facility
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More news: Shares in Lynas Rare Earths tumbled in early trade after the miner disclosed the estimated cost to expand its Malaysian heavy rare earths facility has surged to $294 million, driven by additional equipment requirements and elevated costs.
Shares fell 5.9% to $15.01 at 11:32am AEST.
Lynas Rare Earths’ Malaysia expansion costs grow $114m
The news: The estimated cost of expanding Lynas Rare Earths’ heavy rare earth facility at Lynas Malaysia has increased from about $180 million to $294 million amid additional equipment requirements and higher costs.
June quarter gross sales revenue in the June quarter hit $288.9 million, up $23.9 million on the preceding quarter.
The numbers: Quarterly gross sales revenue was 70% higher than a year prior. Quarterly sales receipts hit $297.1 million, up from $234 million in the preceding quarter while closing cash and short term deposits was more than $1.2 million, up from $1.07 million.
Total quarterly rare earth oxide production also lifted from 3,233 tonnes to 3,481 tonnes. However, NdPr production fell from 1,996 tonnes to 1,857 tonnes. Dysprosium and Terbium production increased to 19 tonnes.
Average selling price for all rare earth products increased to a record $98.2 per kilogram.
The context: The cost increase for the heavy rare earth facility expansion is “due to additional equipment to meet customers’ specific product purity and physical characteristics requirements, the higher cost of sourcing equipment outside China, and cost escalation due to the current geopolitical environment,” according to interim chief executive officer Pol Le Roux
This is the first quarterly report from Le Roux, who began on 1 July. He noted that the quarter focused on the “ramp up of the expanded Mt Weld processing plant and addressing bottlenecks at the Kalgoorlie Rare Earths Processing Facility”.
The source: ASX
