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Lithium producer Allkem reports revenue of $315M in March quarter as production up

Kitco Media
By Vladimir Basov
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(Kitco News) - Lithium producer Allkem (TSX: AKE) announced today that the Olaroz lithium facility achieved production of 4,102 tonnes of lithium carbonate in March quarter 2023, up 38% on the previous corresponding period and a new record for a March quarter.

In a press release, the company said that lithium carbonate sales were 2,904 tonnes, generating record Olaroz quarterly revenue of ~US$159 million with a record gross cash margin of 91% or US$47,814/tonne.

"Excluding shipments to Naraha, third party lithium carbonate sales for the quarter averaged US$53,175/tonne FOB, meeting guidance and up slightly from the December quarter," Allkem said. "The weighted average price for third party sales of lithium carbonate products in June quarter 2023 is expected to be approximately US$42,000/tonne subject to final sales allocation."

The company also reported that Mt Cattlin produced 38,915 dmt of spodumene concentrate at 5.3% Li2O grade during the quarter, a ~2.3x increase quarter on quarter.

Spodumene sales of 21,553 dmt generated revenue of ~US$123 million with a gross cash margin of 81% based on an average sales price of US$5,702 /dmt CIF for SC 5.2%, which corresponds to approximately US$6,500 /dmt on a SC6 CIF basis, up 8% QoQ and above prior guidance.

"Pricing in the June quarter is expected to be approximately US$5,000/dmt CIF SC6," the company said.

Allkem pointed out that an additional US$33 million of revenue was generated from sales of 54,064 dmt of low grade spodumene concentrate.

The company noted that group revenue for the quarter was US$315 million and group gross operating cash margin was approximately US$269 million (85%), adding that at 31 March, group net cash was US$577.9 million, up US$25.9 million from 31 December 2022.

Allkem is a speciality lithium chemicals company with lithium brine operations in Argentina, a hard-rock lithium operation in Australia and a lithium hydroxide conversion facility in Japan. The company also develops the James Bay spodumene project in Quebec, Canada.

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Kitco Media

Vladimir Basov

Vladimir (PhD, MEng in Mining) is a professional mining engineer, scientist and analyst that has more than 20 years of practical in-field and research experience. He is particularly interested in collecting, processing baseline data and writing insightful data-driven mining industry analytics, articles, statistical and research reports.

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