Orocobre Limited (ASX: ORE) today reported a 1% increase in revenue for its 2018 financial year, ended June 30th 2018.
Orocobre, a $1 billion lithium company with operations in Argentina, said higher prices helped it achieve record revenue of $US17.4 million. Statutory profit fell 90% to $US1.9 million.
However, on an underlying basis Orocobre said profit rose to $US25.7 million, up from $US13.8 million last year.
Analysts surveyed by Bell Potter had been expecting a net profit of $US20.7 million. Based on the underlying results, it appears Orocobre’s result was ahead of expectations.
“In 2018, Orocobre demonstrated significant progress in operational performance especially improvements in pond management,” CEO Richard Seville said.
“These improvements came at a fortuitous time, with contract lithium chemical prices rising throughout the year.”
The Olaroz lithium facility, of which Orocobre owns 66.5%, produced 12,470 tonnes of lithium carbonate, up 5% on last year. In 2019, further production increases are expected, the company noted.
“From a strong financial footing, Orocobre is fully funded to develop Stage 2 at Olaroz with lithium carbonate production increasing to 42,500 tonnes per annum,” Seville added. “We are also preparing to construct a 10,000 tonne per annum lithium hydroxide plant with strategic partner Toyota Tsusho Corporation.”
With increasing use in battery-powered devices and cars Orocobre expects demand for lithium to remain robust despite recent falls in Chinese spot prices. For its 2019 year-to-date, Orocobre reported prices of around $US14,000 per tonne.
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