Operational Update, page-2

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jantimot

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02/07/14

11:44

Post #: 13599632
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Originally posted by elyk1981 ↑

Lynas Corporation (ASX:LYC, OTC:LYSDY) announces that it is implementing a number of
initiatives to streamline its operations thereby improving organisational efficiency and reducing
overall costs. The first is a simplification of the Company’s structure by co-locating management
personnel and resources with production and sales facilities in Western Australia and Malaysia.
This will result in the Company’s Head Office relocating from Sydney to Kuala Lumpur. Lynas will
remain listed on the Australian Securities Exchange.

“As I approach the end of my first month as CEO of Lynas, I am very focused on addressing those
areas of our business where we have been underperforming. I have reviewed the business with
the team and we have identified opportunities to improve cost, production and financial
performance,” said Amanda Lacaze, Lynas Chief Executive Officer.

“This streamlining of office locations is the first in a series of initiatives aimed at simplifying our
approach and focusing on the highest value drivers in our business.”

Other initiatives to deliver costs savings include reducing workforce numbers (mostly by reducing
contractor positions), improving asset utilisation, renegotiating supplier contracts and seeking
improvements in procurement practices.

“We are pleased to report that demand for Rare Earth Oxide (REO) products remains buoyant
and that the Company has achieved further increases in production and sales of REO products
during the June 2014 quarter,” said Ms Lacaze.

The company is maintaining a heavy focus on the ramp up of production at the Lynas Advanced
Materials Plant (LAMP) in Malaysia. Over the past quarter further bottlenecks have been
encountered which have affected production outcomes. These have been managed and each of
the major stages of the Phase 1 plant – Cracking & Leaching, Solvent Extraction and Product
Finishing – has individually been operated at target capacity during the quarter.

“We are now working on delivering the optimal balance of volume, finished product quality and
REO yield – the volume of Rare Earths recovered through our process from mining to finished
product. Higher quality output attracts premium pricing. Increasing the proportion of production
that meets individual customer specifications maximises sales revenue and promotes customer
loyalty. By addressing this and by seeking to minimise the amount of Rare Earth lost during
processing of Mt Weld ore, we create better value for shareholders,” said Ms Lacaze.

“Lynas is in the Rare Earth business to make money for its shareholders on a long term and
sustainable basis. We remain confident in our ability to sell what we produce and are focused on
ensuring we have the most appropriate structure for the Company in order to maximise
commercial outcomes for all our stakeholders.”

Further details will be provided in the June 2014 Quarterly Activities report, to be released on 31
July 2014.

Expand

We knew there were production improvements in early May (April was 709t). But clearly Phase 1 didn't reach nameplate, unlikely that they hit the 11,000tpa rate from both plants combined, more production bottlenecks - and just how much REE are they losing during processing? That's a new one .....

No good news. No positives.

Cash report will not be good.

LYC Price at posting: 14.0¢ Sentiment: Sell Disclosure: Not Held
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