Lynas says it’s unlikely to break even this quarter
Published: Jan 28, 2015 12:59 PM | Updated: Jan 28, 2015 4:19 PM
Despite a positive operating cash flow in December, the rare earths producer Lynas Corp says it is unlikely to break even this quarter.
According to its quarterly report Lynas released yesterday, this is due to bleak conditions in the the rare earths market, and hiccups at its plant in Gebeng, Pahang, during its attempts to ramp up production.
This is due to bleak conditions in the rare earths market, the company says.
Despite a positive operating cash flow in December, the rare earths producer Lynas Corp says it is unlikely to break even this quarter.
According to its quarterly report Lynas released yesterday, this is due to bleak conditions in the the rare earths market, and hiccups at its plant in Gebeng, Pahang, during its attempts to ramp up production.
“Lynas does not expect to sustain the positive operating cash flow achieved in December into the March quarter.
“Factors contributing to this include the current market environment, which is characterised by low demand and pricing due to continued uncertainty relating to Chinese government policy, as well as ongoing costs associated with restructuring,” the company said.
However, it said prices may recover in the second quarter of 2015, once rare earths consumers use up their existing stock, and added that Lynas is poised to take advantage of any increase in price.
The Australia-based company mines the rare earths at Mt Weld in Western Australia and processes it at the Lynas Advanced Materials Plant (Lamp) in Gebeng.
Report causes Lynas share prices to drop
News agency Reuters reported yesterday that following the release of the quarterly report, Lynas share prices on the Australian Stock Exchange plummeted from A$0.08 a share to A$0.06.
The quarterly report states that the company had a positive cash flow of A$1.2 million, and this is the first time it has a positive cash flow.
Minerals extracted from rare earths metals are used in a range of applications such as the production of various electronic components, magnets, and high-refractive index glass for camera lenses.
Lynas faced strong opposition from Malaysian NGOs such as Himpunan Hijau and Save Malaysia, Stop Lynas over environmental concerns at Lamp, culminating in mass protests nationwide.
The company has repeatedly given its assurance that its plant is safe and meets Malaysian environmental and safely regulations.
According to its quarterly report Lynas released yesterday, this is due to bleak conditions in the the rare earths market, and hiccups at its plant in Gebeng, Pahang, during its attempts to ramp up production.
“Lynas does not expect to sustain the positive operating cash flow achieved in December into the March quarter.
“Factors contributing to this include the current market environment, which is characterised by low demand and pricing due to continued uncertainty relating to Chinese government policy, as well as ongoing costs associated with restructuring,” the company said.
However, it said prices may recover in the second quarter of 2015, once rare earths consumers use up their existing stock, and added that Lynas is poised to take advantage of any increase in price.
The Australia-based company mines the rare earths at Mt Weld in Western Australia and processes it at the Lynas Advanced Materials Plant (Lamp) in Gebeng.
Report causes Lynas share prices to drop
News agency Reuters reported yesterday that following the release of the quarterly report, Lynas share prices on the Australian Stock Exchange plummeted from A$0.08 a share to A$0.06.
The quarterly report states that the company had a positive cash flow of A$1.2 million, and this is the first time it has a positive cash flow.
Minerals extracted from rare earths metals are used in a range of applications such as the production of various electronic components, magnets, and high-refractive index glass for camera lenses.Lynas faced strong opposition from Malaysian NGOs such as Himpunan Hijau and Save Malaysia, Stop Lynas over environmental concerns at Lamp, culminating in mass protests nationwide.
The company has repeatedly given its assurance that its plant is safe and meets Malaysian environmental and safely regulations.
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