Why is the Lynas share price leaping higher today?

We take a look at what Lynas reported at today's AGM.

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Key points
  • Lynas shares are in the green on Tuesday
  • Lynas held its AGM today, where it highlighted demand for rare earths for electric vehicles and wind energy has increased 
  • Lynas has an agreement with the US Department of Defense for a rare earths separation facility 

The Lynas Rare Earths Ltd (ASX: LYC) share price is trading higher on Tuesday.

Lynas shares are up 2.04%, currently fetching $8.52 apiece. For perspective, the S&P/ASX 200 Index (ASX: XJO) is up 0.28% at the time of writing.

Let's take a look at how this ASX rare earths producer is performing today.

Female South32 miner smiling with mining machinery in the background.

Image source: Getty Images

What is happening at Lynas?

Lynas is not the only ASX rare earths share in the green today. The Peak Rare Earths Ltd (ASX: PEK) share price is up 1.06%, while Arafura Rare Earths Ltd (ASX: ARU) shares are 2.47% higher. The S&P/ASX 200 Materials Index (ASX: XMJ) is also up 1.73% in late afternoon trade.

Today, Lynas held its annual general meeting. In a presentation, the company's CEO Amanda Lacaze highlighted demand is continuing to grow for rare earths used in electric vehicles and for wind energy.

The company showed a slide revealing another five kilotonnes (kt) of Neodymium-Praseodymium (NdPr) oxide is required for 10 million hybrid electric vehicles. And a further seven kt of NdPr oxide is needed for 10 million battery electric vehicles.

Lynas said it is targeting concentrate feedstock of 12,000 tonnes per annum of NdPr products in 2024.

The company shared a YouTube video of its global operations. Lynas said the Mt Weld mine in Western Australia is "one of the world's best rare earths resources". It also showed vision of Lynas Malaysia where rare earths are refined into products, highlighting:

Lynas Malaysia is the world's largest single rare earths processing plant.

In June, the company signed a contract with the US Defense Department for a $120 million heavy rare earths separation facility in the United States. The company is also constructing a rare earths processing facility in Kalgoorlie, Western Australia.

Commenting on the year overall, chair Kathleen Conlon said 2022 was an "excellent year for shareholders". She added:

Rare earths market prices and demand for NdFeB magnets were robust throughout the 2022 year. The recognition of Lynas as a leading supplier of rare earth materials meant that we experienced strong demand for the NdPr product family and mixed Heavy Rare Earth compound (known as SEG) and this was a key contributor to our excellent results.

Lynas reported a net profit after tax (NPAT) of $540.8 million in FY22 and sales revenue of $920 million.

Share price snapshot

Lynas shares have climbed just 0.24% in the past year, while they have fallen 16% year to date. In the past month, Lynas shares have risen 5%.

For perspective, the ASX 200 has climbed 0.06% in the last year.

Lynas has a market capitalisation of about $7.7 billion based on the current share price.

Motley Fool contributor Monica O'Shea 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 Scott Phillips.

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