‘Rise in RE prices lifts Lynas’ WE AUST today NICK EVANS LACHLAN...

‘Rise in RE prices lifts Lynas’ WE AUST today
NICK EVANS LACHLAN MOFFET GRAY
Rare earths miner Lynas has lifted its interim profit as the global price for its commodities rose, and repaid JobKeeper payments to the federal government.
The company recorded a net profit of $40.6m, compared to $3.9m in the prior comparable period, as revenue lifted more than 10 per cent to $202.5m.
Lynas managing director Amanda Lacaze said the result was attributable to cost of sales staying steady while revenue increased on the back of higher prices. The company’s Malaysian refinery has operated at about 75 per cent of its capacity through the pandemic due to health and movement restrictions, and the restricted output — along with rising demand as global economies kicked back into gear — lifted average prices in the half. Lynas averaged $19.20 a kilogram for a basket of its rare earth products in the first six months of 2020, lifting to $23.70 in the second half of the year.
Average pricing was roughly similar to the $23.40 in the six months to the end of December 2019. “Despite ongoing uncertainty in the global economy and logistics /supply chain systems due to the effects of the pandemic, rare earths market settings were favourable and pricing for rare earths materials improved,” Ms Lacaze said. But even with strengthening demand, she said Lynas was in no hurry to return production levels to its nameplate capacity. “We are assessing it on a continuous basis,” she said. Lynas’ rare earth refinery is in Malaysia, which was hit hard by a second wave of the pandemic in January and February. Although some movement restrictions have now been eased, Ms Lacaze said the company needed to keep a close eye on the country’s battles with the virus before it made a decision on ramping up production.
The financial result meant Lynas would return the federal government’s JobKeeper supplement as well as supplements it received from the government of Malaysia, totalling about $1m.
Lynas shares rose 32c, or 5.7 per cent, on Friday to $5.98.