In morning trade the Lynas Corporation Ltd (ASX: LYC) share price has pushed higher following the release of its quarterly update.
The rare earths producer’s shares are up 2% to $2.58 at the time of writing.
What happened in the first quarter?
During the quarter Lynas’ production was managed in line with the calendar year production limit applied by the Malaysian government.
This meant NdPr production came in at 1,242 tonnes and total REO production came in at 3,926 tonnes. This was a decline of 17.5% and 15.5%, respectively, on the previous quarter.
Lynas reported REO sales volumes of 4,186 tonnes, down 11.5% from the previous quarter. This led to invoiced sales revenue of A$99.1 million.
Management advised that the US-China trade war is impacting its sales performance. It said: “Continuing US-China trade tensions, while leading to greater interest in Rare Earths, continue to have a negative short term effect on market confidence, particularly in China.”
In light of this, the average market price for NdPr remained flat at US$39 per kg during the quarter.
Lynas finished the period with a closing cash balance of A$119.1 million. This is up from A$89.7 million at the end of the last quarter.
CEO Amanda Lacaze said: “Sales revenue was strong at A$99.1m, despite the volatile market conditions, and sales receipts were A$96.0m for the quarter. Outside China demand for NdPr continued to grow and all NdPr was reserved for our strategic customers.”
“During the quarter there was increased interest from magnet buyers in Europe and the US for long term contracts to secure their supply chains. Demand for La (Lanthanum) also remained high during the quarter, and sales value for this product was maximised,” she added.
Looking ahead, Lacaze appears confident in the direction the company is going.
She said: “There continues to be strong interest in Rare Earth materials and in Lynas as the only significant outside China producer. We are uniquely positioned to benefit from the strong growth forecast. We are making good progress with our Lynas 2025 growth plans and we look forward to updating you as details are finalised.”
Elsewhere in the sector, the St Barbara Ltd (ASX: SBM) share price has edged higher following its quarterly update. And the Strike Energy Ltd (ASX: STX) share price is flat following a Perth Basin update.
The post Lynas share price higher on solid quarterly update appeared first on Motley Fool Australia.
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