Liontown share price tumbles 7% on half-year results

This lithium developer's results have been released this afternoon.

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The Liontown Resources Ltd (ASX: LTR) share price is having a tough finish to the week.

In afternoon trade, the lithium developer's shares are down 7.5% to $1.26.

This has been driven by the broad weakness in the lithium industry today, which has overshadowed the release of the company's half-year results.

Let's now take a look at how the company performed during the half.

Liontown share price tumbles on results day

Firstly, as Liontown is still pre-revenue, its results look very different to its revenue-generating peers like Core Lithium Ltd (ASX: CXO) and Pilbara Minerals Ltd (ASX: PLS).

For the six months ended 31 December, the company reported a net loss before tax of $31 million. This includes interest revenue of $8.5 million, corporate and administrative costs of $20.7 million, share based payments of $3.9 million, and exploration and evaluation expenditure of $6.6 million.

Management notes that its corporate and administrative expenses increased $14.3 million due partly to an increase in personnel expenses in line with its increased headcount. In addition, there are costs related to its proposed scheme of arrangement with Albemarle Corp (NYSE: ALB), which was terminated on 16 October, as well as system development and implementation costs necessary for the commencement of operations.

Liontown's net cash used in investing activities was $325.6 million and its net cash from financing activities was $555.8 million for the six months. The latter includes drawdowns from the Ford facility ($181.3 million) and the proceeds from the issue of shares ($389.9 million), offset by share issue costs ($11.2 million).

This ultimately led to Liontown ending the period with cash and cash equivalents of $516.9 million. Since then, it has announced a $550 million debt facility agreement with a syndicate comprising leading domestic and international commercial lenders, and government credit agencies.

This is expected to take Liontown through to production and positive cash flow.

Speaking of which, management has confirmed that the Kathleen Valley Lithium Project remains on schedule for first production in mid-2024 and is in line with the updated $951 million capital cost estimate.

The Liontown share price are down 14% over the last 12 months.

Motley Fool contributor James Mickleboro 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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