Pilbara Minerals exceeds production targets, cuts costs, and strengthens operations despite weaker lithium prices and market uncertainty.
Pilbara Minerals has reported robust operational performance for the June quarter, surpassing its full-year production guidance and achieving cost reductions, even as global lithium prices continue to face downward pressure. The company’s strong results were primarily driven by the successful commissioning and ramp-up of its P1000 expansion project at the Pilgan plant, which significantly boosted output and efficiency.
In the three months ending June 30, Pilbara Minerals produced 221,300 tonnes of spodumene concentrate—a remarkable 77% increase compared to the previous quarter. This surge followed the completion of the P1000 project, enabling a step-change in throughput. Sales volumes also climbed substantially, reaching 216,000 tonnes, a 72% increase quarter-on-quarter. However, weaker market pricing had a dampening effect on revenue per tonne. The average realised price fell by 17% to $703 per tonne (on a 6.0% lithium oxide basis). Despite this, total quarterly revenue rose by 28% to A$193 million, driven by the sharp uptick in sales volume.
For the entire financial year, the company delivered 754,600 tonnes of spodumene concentrate, exceeding its guidance range of 700,000 to 740,000 tonnes. This outperformance was largely attributed to the strong results posted in the June quarter. Additionally, operating costs improved significantly. The free-on-board (FOB) unit cost fell 10% to A$619 per tonne (equivalent to $397 per tonne), while the cost, insurance, and freight (CIF) unit cost dropped 9% to A$721 per tonne. These gains were supported by the rollout of a streamlined operational model (P850) and higher plant utilisation.
The company reported a cash operating margin of A$98 million for the quarter, supported by increased sales and favourable working capital movements. However, its cash reserves declined by A$88 million from the previous quarter to A$1 billion, reflecting capital expenditures linked to the P1000 completion and associated infrastructure investments.
Despite the lithium market’s ongoing volatility, Pilbara Minerals believes it is well-positioned due to its operational agility, robust balance sheet, and focus on cost control. The company also upgraded its mineral resource by 23% during FY2025, reinforcing its Pilgangoora operation as one of the largest hard-rock lithium assets globally.
Looking ahead, FY2026 is expected to be a transformative year. Pilbara is guiding for production between 820,000 and 870,000 tonnes, with further cost reductions anticipated, targeting FOB unit costs between A$560 and A$600 per tonne. Capital expenditure is projected to fall sharply to A$300 million–A$330 million, down nearly 45% from FY2025, as the company adopts a more selective investment strategy.
Key operational priorities include expanding the use of “contact ore”—a cost-effective ore-host rock blend—to reduce mining expenses and enhance overall ore recovery. While the Ngungaju plant will remain on care and maintenance through FY2026, investments will focus on critical infrastructure like a new tailings storage facility and a spare parts warehouse. Major projects such as Stage 2 of the power strategy have been deferred to align with market conditions. Spending on the Colina project will remain modest, limited to A$40 million–A$45 million, with a focus on exploration and land acquisition.
Pilbara Minerals reaffirms its commitment to disciplined capital management and continuous improvement, even amid challenging market dynamics.
