Disappointing results for Lynas Corp

22
107

Lynas reportedly sold its rare earths for the equivalent of a little over A$5/kg compared to production costs of almost $20/kg, earning just $600,000 on the back of sluggish market prices.

Look at this share price chart for Lynas Corp (listed on the Australian Stock Exchange):

And have a look at Lynas’ cash flow report for the April-June 2013 quarter.

Lynas cash flow report June 2013 quarter

Australian Network News reports:

In the company’s first earnings report since it begun a three year process of construction and licensing, Lynas earned $600,000 for the June quarter on the back of weak prices.

Lynas sold its rare earths for the equivalent of a little over five dollars a kilogram. Production costs, however, were almost 20 dollars a kilogram.

Eric Noyrez, Lynas’ CEO says the result is disappointing.

“Rare earths market volumes and prices have been extremely challenging for the past six months,” Mr Noyrez said.

Lynas sold 117 tonnes of refined product in the period – a long way short of its phase one target of 11,000 tonnes for the year

It reported equipment problems and processing times that were longer than expected.

Its refinery in Kuantan, Malaysia is still operating under a temporary licence until plans for a permanent waste disposal facility are approved.

Mr Noyrez says the plan was submitted in early July.

The company describes some teething problems in its quarterly report:

…the Company has identified some clogging and premature wearing of equipment that is affecting its ability to maintain this production rate in the cracking and leaching units. A series of work programs involving equipment changes and materials handling to allow the cracking and leaching units to operate continuously at nameplate production capacity have and will continue to be implemented. None of these programs involve significant capital investments and are expected to be in place over the coming months. Commercial production of REO products at a reduced volume will continue while these programs are ongoing.

Meanwhile, the DoE’s data on the environmental monitoring of the Lynas plant in Gebeng was not accessbile when checked this morning. It leads to an invalid directory.

READ MORE:  The Penang Island map they won't want you to see

The data from Lynas, however, is available and shows that it is within regulatory or permissible limits. Similarly, for the AELB readings until April 2013.

But bear in mind, the refinery is a long way from full production capacity.

Please help to support this blog if you can.

Read the commenting guidlelines for this blog.

22
Join the conversation

avatar
2000
14 Comment threads
8 Thread replies
0 Followers
 
Most reacted comment
Hottest comment thread
17 Comment authors
joe CrisseJaysonAnil NettoClub41 Oonsemuanya OK kot Recent comment authors
  Subscribe  
newest oldest most voted
Notify of
don anamalai
Guest
don anamalai

“BURY LYNAS WITH 1,000,000 SIGNATURES” CAMPAIGN Himpunan Hijau, will take on a “MISSION IMPOSSIBLE”, something of the highest intensity which has never been done before in the history of Malaysia, that is to collect 1,000,000 signatures within 100 days from across the nation. The 1,000,000 signatures collected will represent the people’s strong commitment to bring down Lynas. It will be a physical object that signifies the people’s power and will be the most powerful weapon against Lynas. Once collected, the 1,000,000 voices of the rakyat will be brought to : 1) Appeal to the highest authority of this land, KDYMM… Read more »

joe Crisse
Guest
joe Crisse

Lynas wants to make a quick buck on the back of Malaysians.

Now Malaysia can say, thank you Lynas for the construction job… and we thank you beforehand for all the legal jobs you’re going to create.

semuanya OK kot
Guest
semuanya OK kot

Some related info from a documentary:
– The usage of rare earths is unsustainable.
– There is no recycling at present. The methods have not been developed.
– The quantities in computers and phones is comparatively tiny. The usage in electric car motors and
windnmills is unsophisticated. One giant 5MW windmill uses at least 1 tonne. Those made in China use
up to 4 tonnes.
– USA has reopened its major rare-earth mine that it closed when the supply (from China) was cheap.

Kittykat46
Guest
Kittykat46

What an irony. The Malaysian government steam rolled all objections and concerns over the Lynas project in anticipation of massive exports and profits that it would bring. Now even the business case may be doubtful.

Club41 Oon
Guest
Club41 Oon

Felda shares down due to uncertain oil palm prices
http://www.thestar.com.my/Business/Business-News/2013/08/05/felda-oil-palm.aspx

BN will have a lot to answer soon besides the Lynas performance.

Phua Kai Lit
Guest
Phua Kai Lit

Latest news is that Lynas has “replaced” its Chief Operating Officer.
The new COO is French.

Internal turmoil within the company because of poor sales? (desperate action in desperate times)
An attempt to increase sales in the European market too?

Phua Kai Lit
Guest
Phua Kai Lit

Dear blog readers

Please do not forget that the people of Johor are fighting against the Pengerang project too
(the people of Taiwan have already rejected the project).

don anamalai
Guest
don anamalai

Yes, we should support the Angry Lobster movement in Pengerang!

The fate of the fishermen are draped in uncertainty after impending oil and gas projects threaten the economic livelihood, environment, and even graveyards of the locals.

http://www.therocket.com.my/en/why-are-the-lobsters-ngry/

Club41 Oon
Guest
Club41 Oon

Good news!
Taiwan’s KuoKuang has scrapped the RM42.5 billion investment plan in Pengerang, Johor!

http://www.theedgemalaysia.com/business-news/247311-chinese-press-kuokuang-scraps-pengerang-project-report-says.html

Jayson
Guest
Jayson

On the front page headlines of local chinese newpapers today:
KuoKuang has informed the Taiwanese press that it is not coming to Malaysia.

Oriental Daily:
http://www.orientaldaily.com.my/index.php?option=com_k2&view=item&id=69199:&Itemid=113

Nanyang:
http://nanyang.com.my/node/556453?tid=772

Should be reported on English newspapers tomorrow.

Danny Kua
Guest
Danny Kua

I happened to witness the talk by Mr Wong Tack (near YB for Bentong if not of $%#@) about the need to be aware of the hazardous impact of Lynas operation; while I was visiting International Chinese Book Fair at PISA Penang. During Q&A session, a question posed if 300,000 signatures from predominantly Chinese from Penang will make the event less promising to the government. Mr Wong than asked the participant how old he is and he replied 21 years old. Then Mr Wong simply said that present young generation unfortunately has fallen into Mahathirism Doctrine of thinking foremost in… Read more »

loke min xian
Guest
loke min xian

Thanks for sharing. I bet Anil and gang will lend support to the cause.

Malays must step out from the dark shadows of Utusan and TV3 if they wish to get the real and complete picture of the situation. But their poor command of other languages has handicapped them to seek the truth beyond the mainstream media.

don anamalai
Guest
don anamalai

Disappointed that BN government still cannot tell us where the Lynas waste from Kuantan be shipped to.

najib manaukau
Guest

To begin with, if Lynas was such a profitable organisation why ? …

Yang
Guest
Yang

Hopefully it get more disappointed

ksooyeoh
Guest
ksooyeoh

“the Company has identified some clogging and premature wearing of equipment that is affecting its ability to maintain this production rate in the cracking and leaching units.” Is this happening in Lynas Gebeng? someone please seriously look into this if it’s happening in Lynas Gebeng plant.

Phua Kai Lit
Guest
Phua Kai Lit

Lynas should have stayed in Oz. They shot themselves in the foot by trying to take advantage of a corrupt Third World political system.

Andrew I
Guest
Andrew I

Haha. As Gherkin K would say, padan muka.

rakyat
Guest
rakyat

One of the best news re lynas for the kuantanites.

rajraman666
Guest
rajraman666

Most of the government email and data tak bolih pakai.Their phone number listed also tak boleh pakai.
rajraman.Invoke the cursed of devil – Lynas will lose $ forever until the closed down. They earning $ on other people’s health.