Liontown Resources (ASX:LTR) has today failed to impress investors on HotCopper with its quarterly report, with a slowly emptying company kitty and vague presentation messaging about a ‘changing world’ worrying some.
One HotCopper poster could only manage “oh boy” after looking at news Liontown had seen cash outflows of $230 million through the last September quarter.
Much of that financial output came down to sagging lithium sale prices as well as the Western Australia minerals producer funnelling $110 million into further construction (though not expansion) at its Kathleen Valley mine near Leinster.
Liontown today updated investors on its optimisation plans, with the company now looking to reshuffle things “in response to the current low pricing environment” – further updates on that front will come by the end of the year.
There will also be a thorough review of the WA producer’s mine plan as well as updated guidance on production and costs by the end of October.
“We’ve designed the orebody when the market was very strong,” Liontown managing director Tony Ottaviano said on Wednesday before admitting “the world has changed.”
Any potential LTR reshuffle won’t include care and maintenance, Mr Ottaviano confirmed.
Those drawn battlelines did little to sway sentiment across HotCopper forums through Wednesday morning however, with some disappointed users agreeing the reported numbers had turned out “uglier than anyone imagined.”
“Now we know why it dropped yesterday before close,” wrote another. “What a disaster.”
“Glad I took profits at 94c yesterday!!” one LTR investor celebrated.
Others voiced concerns over Liontown compared to a major WA lithium rival, Pilbara Minerals (ASX:PLS), which just mothballed its Ngungaju plant to keep costs down. “If they can’t make it work, LTR is stuffed,” one user mused.
There was hope through some groups, with one poster suggesting everyone “enjoy the ride” before prices spike again – though they were outnumbered.
The poor sentiments around Liontown’s October update carried across the ASX too, where LTR took a soft beating to the tune of -4%. LTR last traded at 85.5cps today.
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