A significant number of Sayona Mining Ltd (ASX: SYA) shares have been changing hands on Thursday.
At the time of writing, 27 million of this lithium miner's shares have been traded.
Unfortunately, there have been more sellers than buyers, which means that its shares are down 3% to 3.2 cents.
Why are Sayona Mining shares falling?
Investors have been selling the company's shares today after the lithium miner released its quarterly update.
Once again, that update revealed that Sayona Mining is selling its lithium for less than it costs to produce.
According to the release, Sayona Mining achieved record production of 52,141 dry metric tonnes (dmt) of spodumene concentrate at an average grade of 5.3%. This was up 5% and driven by excellent mill utilisation and strong operational control.
Unit operating costs per tonne sold for the North American Lithium (NAL) project decreased 11% quarter on quarter to A$1,335 (US$894) per dry metric tonne (dmt) as improved process plant utilisation reduced downtime maintenance costs.
Total concentrate sold during the three months was up 77% on the prior quarter to 48,992 dmt, generating revenue of A$52 million.
And while the average realised selling price (FOB) increased by 21% quarter on quarter to A$1,067 (US$711) per dmt thanks to improved commercial sale terms, this is still almost A$300 less than it costs to produce.
Despite this, Sayona Mining's cash and cash equivalents balance was A$104.2 million at the end of September. This is a A$13.6 million increase over the three months.
Though, it is worth noting that this reflects positive net working capital movements, which generated a cash inflow of A$46 million for the quarter driven by customer prepayments and drawdown of ROM inventories at NAL.
Looking ahead, the lithium miner has reaffirmed its guidance for production of 190,000 dmt to 210,000 dmt with unit operating costs per tonne sold of A$1,150 to A$1,300 per dmt.
Management commentary
Sayona Mining's managing director and CEO, Lucas Dow, was pleased with the quarter. He said:
The production of 52,141 dmt of spodumene concentrate ensures we remain on track toward our full year guidance of 190-210 kdmt (thousand dry metric tonnes) with NAL now approaching steady state operations. The full benefit of the Crushed Ore Dome is now starting to be realised by providing a buffer between the mill and crusher circuit ensuring that regardless of any stoppages in the crusher circuit the mill continues to receive feedstock to allow operations to continue.
Dow spoke positively about the future, he said:
While market conditions remain challenging, Sayona is focused on optimising and improving operational results to ensure the Company is well positioned for the eventual upturn in the lithium industry.
