• Revenue: Increased, but specific figures not provided.
• Underlying EBITDA: $302 million, down approximately 55%.
• Mining Services EBITDA: Record $379 million.
• Commodities Loss: Under $30 million.
• Iron Ore EBITDA: $54 million from Onslow, total Iron Ore EBITDA loss of $9 million.
• Lithium Loss: $15 million, with Marion and Wodgina marginally profitable.
• Net Income (NPAT): Loss of $807 million, driven by impairment charges and foreign currency impacts.
• Cash Balance: $720 million at the end of the half.
• Net Debt: Increased to $5.1 billion.
• CapEx: $1.4 billion for the half.
• Available Liquidity: Over $1.5 billion.
• Iron Ore Production: 9.7 million tonnes exported.
• Onslow Iron Production: 6.3 million tonnes produced, 4.6 million tonnes shipped.
• Mount Marion Lithium Shipment: 100,000 tonnes at USD667 per tonne FOB.
• Wodgina Lithium Shipment: 101,000 tonnes at USD628 per tonne FOB.
• Energy Sale: $780 million from selling two tenements in the Perth Basin.

• Warning! GuruFocus has detected 10 Warning Signs with MALRF.

Release Date: February 19, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Mineral Resources Ltd (MALRF) reported a successful ramp-up of the Onslow Iron project, achieving substantial capacity with over 40 million tonnes of capacity.
• The Onslow Iron project is cash flow positive, contributing significantly to the company's ability to deleverage its balance sheet.
• Mining Services delivered a record EBITDA of nearly $380 million, showcasing strong growth and long-term potential.
• The company has a strong liquidity position with over $1.5 billion available, focusing on banking cash and minimizing spend.
• Mineral Resources Ltd (MALRF) has made significant progress in reducing costs in its lithium operations, with both Mount Marion and Wodgina becoming profitable in December.

Negative Points

• The company faced significant weather-related challenges, including cyclones, which delayed the Onslow Iron project ramp-up by about six weeks.
• The Yilgarn operation was closed due to high costs, resulting in an $87 million loss as it moved to care and maintenance.
• The company reported a loss of $807 million, driven by impairment charges and foreign currency impacts.
• The lithium segment experienced a downturn, with a loss of $15 million due to lower spodumene prices and market conditions.
• The Onslow Haul Road required additional investment for repairs and upgrades, with an estimated $170 million spend over the next six months.

Q & A Highlights

Q: Can you provide more details on the issues with the haul road and the confidence in ramping up production? A: Christopher Ellison, Managing Director, explained that the road was designed by national and international experts and is about 95% correct. The issues are not related to safety but are due to unprecedented weather conditions. Trial work on remediation has been successful, and the road is expected to support the planned ramp-up.

Q: How is the Mining Services business performing, and what are the expectations for margin expansion? A: Mark Wilson, CFO, noted that the Onslow project provides an opportunity to elevate the Mining Services business. The business is expected to see both margin expansion and volume growth, with contracts structured to protect against risks during ramp-up phases.

Q: What is the rationale for the change in the Onslow project's life expectancy from 50 to 30 years? A: Christopher Ellison clarified that the change reflects the current understanding of the project's resources and the ongoing discussions to consolidate ownership of tenement packages. The project has a long runway before needing additional resources.

Q: What are the current recovery rates at Wodgina, and what improvements are expected? A: Christopher Ellison stated that current recoveries are around 55%, with peaks at 63%. The goal is to reach 70% over two years, driven by better ore feed quality and minor plant modifications.

Q: How does the company plan to manage potential volatility in iron ore prices? A: Mark Wilson explained that even at lower price points, the Onslow project remains profitable. The Mining Services business tends to perform better in low-price environments, and the company has contingency plans, including asset transactions, if necessary.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.