Lindian Resources (LIN) Q1 2025 TU earnings summary

Executive summary

• Stage 1 Feasibility Study for Kangankunde Rare Earths Project confirmed robust economics and low technical risk, with all key permits and licences secured for construction and operations.

• Advanced funding discussions underway for both Stage 1 and potential Stage 2 expansion, with strong investor interest following feasibility results.

• Community resettlement and engagement plans implemented, and detailed design for the process plant commenced with two contractors engaged.

• Progress continued on Guinea bauxite assets, with ongoing discussions to unlock value and engagement with local stakeholders.

• Cash balance at quarter-end was $9.7M, with several senior management appointments to support project development.

Financial highlights

• Stage 1 pre-tax NPV (real) of US$794M, IRR of 99%, and average annual EBITDA of US$84M.

• Pre-production capital cost of US$40M, among the lowest in the rare earths sector.

• Average annual FOB operating cost of US$2.92/kg TREO, in the lowest global quartile.

• Pre-tax payback period of 1.25 years and NPV to Capex ratio above 19.

• Quarterly cash outflows: $1.79M on exploration, $183k on Guinea bauxite, $226k in related party payments; nil mine production or development spend.

Outlook and guidance

• Construction of Kangankunde Stage 1 targeted to commence in Q4 2024, with plant commissioning in Q4 2025.

• Ongoing negotiations for project funding, with a focus on non-dilutive solutions and potential for expanded Stage 2 development.

• Additional offtake agreements under consideration to diversify sales beyond existing contract.