Liontown Q3 FY25 presentation: Production up 12%, costs down 18% amid mining transition

Introduction & Market Context

Liontown Resources Ltd (ASX:LTR) presented its March Quarter FY25 results on April 24, 2025, highlighting operational improvements and positive cash flow generation at its Kathleen Valley lithium project. The Australian lithium producer continues to ramp up operations amid a backdrop of growing demand for battery materials from electric vehicle (EV) and energy storage sectors, despite current low pricing environments in the lithium market.

Quarterly Performance Highlights

Liontown reported significant improvements across key operational and financial metrics for the March quarter. Spodumene concentrate production reached 95,709 dry metric tonnes (dmt), representing a 12% increase from the previous quarter, while sales volumes grew 15% to 93,940 dmt.

Revenue climbed to A$104 million, up 17% quarter-over-quarter, while unit operating costs decreased by 18% to A$816 (US$512) per dmt. The company achieved positive net cash flow from operating activities of A$14 million, maintaining a strong cash position of A$173 million at quarter-end.

As shown in the following quarterly metrics summary:

Operational Progress

The company’s processing plant continued to show performance improvements, with lithia recovery increasing from 58% in the December quarter to 64% in the March quarter. Mill availability remained high at 91%, while throughput exceeded targets with 583,000 dmt processed during the period.

March proved to be a record month across multiple metrics, with 37,171 dmt of spodumene concentrate produced at 68% lithia recovery and an average grade of 5.2% Li₂O. The company remains on track to achieve its 70% lithia recovery target by Q3 FY26.

The following chart illustrates the steady improvement in plant availability and recovery rates:

Underground development continues to exceed expectations, with 1,849 meters of development achieved during the quarter—approximately 160 meters ahead of plan. The underground operations extracted 53,000 tonnes of clean ore with an average grade of 1.5% Li₂O, higher than the open pit grade of 1.0%.

The company is strategically managing the transition from open pit to underground mining, with the Kathleen’s Corner Open Pit on track for completion in Q3 FY26. Liontown has built significant run-of-mine stockpiles totaling approximately 1.3 million tonnes, representing an investment of A$103 million, which will support processing volumes during the transition period.

The underground development progress is illustrated here:

Financial Performance

Liontown’s financial position strengthened during the quarter, with A$101 million in cash receipts from customers and positive cash flow from operating activities of A$14 million. The company ended the period with A$173 million in cash and 23,000 dmt of concentrate inventory.

The cash flow bridge below shows the movement in cash position during the quarter:

Since commencing production in July 2024, Liontown has produced over 200,000 dmt of spodumene concentrate at an average grade of approximately 5.2% Li₂O. The company completed five shipments during the March quarter, with strong inbound interest continuing for its spodumene volumes.

Production and sales trends are shown in the following chart:

Strategic Outlook

Liontown is progressing with its transition from open pit to underground mining, with underground production commencing on schedule in April 2025. Processing trials of underground ore have demonstrated multi-day lithia recoveries exceeding 70%, highlighting the potential for improved performance as the transition continues.

The company operates in a market with strong projected demand growth. Despite current low pricing levels that are disincentivizing exploration, Liontown notes continued strong demand across multiple segments, particularly in EV and energy storage systems.

Market forecasts from Wood Mackenzie and CATL project significant growth in lithium demand through 2030:

Liontown’s comprehensive quarterly operational and financial metrics demonstrate the company’s progress in ramping up production while managing costs:

With a track record of meeting operational targets, continued plant performance improvements, and a strategic approach to the mining transition, Liontown appears well-positioned to capitalize on the long-term growth in lithium demand despite current market challenges.

Full presentation:

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