Pilbara Minerals managing director Ken Brinsden believes global lithium demand is in full swing after the company reported higher sales of its product from the Pilgangoora operations in Western Australia.
The company improved its cash gross margin by $58.4 million to $46.2 million in the 2020-21 financial year after operating at a loss during the previous fiscal period.
Brinsden said the lithium sector enjoyed an “incredible turnaround” during the second half of the 2020-21 financial year.
“Global demand growth for lithium raw materials has now really kicked-in and it is resulting in substantial increases in the price received for our products,” Brinsden said.
“Thanks to the efforts of our team who deployed the moderated production strategy. As a result, we were able to sustain operations during tough market conditions and have emerged stronger than ever.”
Pilbara Minerals shipped 281,440 dry metric tonnes of spodumene concentrates, up from 116,256 dry metric tonnes last year, at a cost of $519 per dry metric tonne.
The company also recorded a positive earnings before interest, taxes, depreciation and amortisation of $21.4 million.
Brinsden expects that the company will supply around 550,000 to 580,000 tonnes of spodumene concentrate per annum by June 2022 through its offtake agreements and battery material exchange (BMX) digital trading and sales platform.
The increase in supply comes from plant improvement and optimisation works, enhancing the output of Pilgangoora’s Pilgan plant.
“By using the downtime wisely to undertake plant improvement and optimisation works, the Pilgan plant is performing better than ever and we are now focussed on increasing production capacity to up to 380,000 tonnes per annum of spodumene concentrate,” Brinsden said.
“By utilising the BMX platform, we will have an additional sales channel to help realise more of the available margin available between the value of spodumene concentrate and lithium hydroxide in this buoyant market, which will be an outstanding outcome for us and our shareholders.”