Syrah Resources (ASX:SYR) share price slumps on US$24.9 million loss

The graphite producer’s shares are faltering today. Here’s why

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The Syrah Resources Ltd (ASX: SYR) share price is sliding today after the company released its earnings for the first half of 2021.

Right now, the Syrah share price is $1.34, 2.19% lower than its previous close.

Syrah share price slips on half-year earnings

Here’s how Syrah Resources performed for the 6 months ended 30 June 2021:

  • After-tax loss of US$24.9 million, an improvement on that of the first half of 2020 which saw a loss of US$28.7 million;
  • US$8.9 million of revenue;
  • Depreciation and amortisation expense relating to Balama of US$4.9 million, offset by US$7.1 million worth of changes to inventory.

The company ended the period with US$85.3 million in cash. Over the period, it has received cash from a share purchase plan and its issuance of convertible notes.

What happened in the first half of 2021 for Syrah?

The 6 months ended 30 June was a busy period for Syrah and its share price.

The company restarted production at its Balama Graphite Operation in March 2021. It was shut down in March 2020 due to the impacts of COVID-19.

For the months it was operational, it produced approximately 33,500 tonnes of natural graphite. It also sold and shipped approximately 17,000 tonnes of its products.

However, global shipping disruptions impacted shipments and sales volumes towards the end of the half-year. The disruptions also impacted production volumes due to warehouse capacity issues.

Syrah also worked towards becoming a large-scale vertically integrated producer of natural graphite active anode material (AAM) at its US-based Vidalia facility.

It achieved first fully integrated production of battery specification AAM from the carbonisation furnace at Vidalia, using natural graphite from Balama.

The company is now to make an investment decision for the construction of a facility capable of creating 10,000 tonnes of AAM per annum at Vidalia.

Additionally, Syrah stated market conditions are still supportive of its decision to restart production at Balama.

Syrah share price snapshot

Despite today’s fall, the Syrah share price has been performing well on the ASX lately.

It has gained 36% year to date. It is also 243% higher than it was this time last year.

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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