The following appears in the Activities Report, but not in the Presentation: "While the first product certification is expected to improve PPLS's cash flow position from sales of Train 1 product, additional funding for PPLS may be required in CY25 due to current low market pricing, depending on ramp-up progress, sales performance, and prevailing market conditions."
From this it appears to me that the Posco JV will not be making a profit until the price of Lithium hydroxide rises, and further that Pilbara may need to stump up some more cash like the $22.5 million stated in the September 2024 Quarterly Activities Report: "During the September Quarter, PPLS secured an additional KRW200B (~US$150M) in debt facilities to fund working capital for ramp up and commissioning. Pilbara Minerals’ 18% attributable share of these facilities is US$22.5M. These new debt facilities are non-recourse to Pilbara Minerals, consistent with the existing PPLS debt facilities. Pilbara Minerals notes that further funding may be required for PPLS in CY2025, subject to ramp up, sales outcomes and market conditions."
I don't see the Posco JV as being cash flow positive for Pilbara for many years, especially as Pilbara has yet to pay the $79M plus compounding interest for its initial 18% share. (This was financed by a loan arranged by Posco.)
Cantankerous James
PLS Price at posting:
$2.37 Sentiment: Buy Disclosure: Held
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