The IGO Ltd (ASX: IGO) share price is leaping higher today.
Shares in the S&P/ASX 200 Index (ASX: XJO) lithium miner closed yesterday trading for $5.67. In morning trade on Tuesday, shares are swapping hands for $5.86 apiece, up 3.4%.
For some context, the ASX 200 is down 1.2% at this same time.
This comes following the release of IGO's quarterly update for the three months to 30 June (Q4 FY 2024).
Here are the highlights.
IGO share price rebounds on earnings win
The IGO share price is marching higher after the miner reported underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) of $88 million, up from a loss of $15 million in Q3.
In other positive metrics, underlying free cash flow increased by 154% quarter on quarter to $201 million.
Over the three months, IGO's nickel production increased by 16% from Q3 to 7,600 tonnes. And spodumene concentrate production was up 19% from the prior quarter to 332,000 tonnes.
As at 30 June, the company had a net cash position of $468 million, up 70% from the March quarter.
As reported on 16 July, IGO said it expects to record an impairment in the range of $275 million to $295 million against its exploration assets for FY 2024. This is related to a revaluation of its Silver Knight and Mt Goode nickel exploration projects, along with an ongoing review and turnover of the company's exploration portfolio.
IGO said the non-cash impairment will not impact its FY 2024 EBITDA.
What did management say?
Commenting on the results helping boost the IGO share price today, CEO Ivan Vella said:
Despite prevailing commodity prices, it has been encouraging to see IGO's asset quality reflected in a strong free cash build over the quarter of $201 million, leaving our balance sheet at the end of June in an outstanding position with $468 million cash at bank.
Vella singled out the company's Greenbushes lithium project as helping drive the improved earnings margins.
According to Vella:
Greenbushes' world class cost position continues to drive outstanding EBITDA margins which were 67% for the quarter and 85% over FY 2024. This enabled the payment of over $761 million in dividends from TLEA during FY 2024, demonstrating the value our world class lithium business can generate through the cycles.
On the nickel front, Vella added, "In our Nickel business, our focus is to safely maximise cash generation from Nova over its remaining life."
Looking to exploration, Vella said, "To underpin our future organic growth, our exploration activity will progress, informed by a renewed strategy, focus and structure."
IGO share price snapshot
The IGO share price has a way to go before recovering from the losses inflicted by collapsing lithium prices.
With today's intraday moves factored in, shares in the ASX 200 lithium miner are down 56% over 12 months.
