Liontown Resources Ltd (ASX: LTR) shares are falling on Thursday.
In morning trade, the lithium miner's shares are down 3% to 88 cents.
This follows the release of its first set of full year results as an operating company.
Liontown shares fall on results day
For the 12 months ended 30 June, Liontown generated $298 million in revenue from its Kathleen Valley lithium project, which delivered its first production in July 2024 and achieved commercial production by January 2025.
Despite weak lithium prices, the company still posted underlying EBITDA of $55 million for the 12 months, which represents an 18% margin.
Operating cash flow was breakeven in FY 2025, supported by $112 million in cost savings and deferrals.
However, Liontown recorded an underlying net loss after tax of $140 million for the year. This reflects amortisation of open pit waste and depreciation on its new processing plant.
Its statutory net loss after tax was $193 million, including an $81 million non-cash write-down of ore sorting potential stockpiles.
Nevertheless, Liontown ended the financial year with $156 million in cash. But since then, it has raised funds through an equity raising, leaving it with a pro forma cash balance of $528 million. Management believes this positions it well for its transition to underground mining operations in FY 2026.
'A milestone year'
Commenting on its performance, Liontown's managing director and CEO, Tony Ottaviano, said:
FY25 was a milestone year for Liontown. In our first year of operations at Kathleen Valley, we generated $298 million in revenue and positive underlying EBITDA despite a challenging lithium price environment. While we reported a statutory loss, this was expected in a commissioning year and reflects depreciation and the treatment of stockpiles built up during ramp-up.
What matters is that the underlying performance was positive and cash neutral. Our balance sheet was further strengthened with the equity raising completed after year-end, taking pro forma cash to $528 million and ensuring we are funded for the transition to underground operations.
Outlook
Ottaviano spoke positively about the company's outlook, noting that while FY 2026 will be a transition year with higher costs in the first half, FY 2027 should be the year it becomes globally significant. He said:
FY26 will be a transition year, a "tale of two halves", with elevated unit costs as we run dual open pit and underground operations and process OSP material in the first half resulting in lower recoveries, production and sales. We expect to see recoveries improving in the second half to reach the ~70% target by Q3 FY26 as we process predominantly higher-grade underground ore. From FY27, we expect to realise the full benefits of underground mining, positioning Liontown as a globally significant, sustainable supplier of lithium.
