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PL

Piedmont Lithium Inc. (PLL)·Q3 2024 Earnings Summary

Executive Summary

  • Record quarter: revenue $27.7M, shipments ~31.5K dmt, gross margin 9.6%; realized price $878/dmt beat peers via futures contango and shipment consolidation .
  • Costs improved: realized cost of sales fell to $794/dmt and NAL unit operating costs declined 15% QoQ (ex inventory), with mill utilization at 91% and recovery ~67% .
  • Full-year shipments guidance cut to 102K–116K (from 126K) due to deferring 1–2 Q4 cargos into Q1’25 to save ~$1.3–$1.4M in transport costs; management says deferral is accretive to 2025 shipments .
  • Liquidity supported by $25M working capital facility (net proceeds $18M) and cash rose to $64.4M; restructuring and impairment of $4.6M linked to Tennessee Lithium shift .

What Went Well and What Went Wrong

What Went Well

  • Record operational execution: “We are very pleased with the continued quarterly progress at NAL, with new records set in Q3 for production and mill utilization rates… driving an improvement in unit operating costs” — CEO Keith Phillips .
  • Commercial strategy outperformed: “Our ability to hedge against the futures market resulted in a realized price that was comparatively one of the best in the industry” — CEO; SC6-equivalent realized price $976/ton .
  • Cost discipline elevated: 2024 Cost Savings Plan increased to ~$14M annual savings; workforce reduced 48% Feb–Oct; Q3 capex ~$$2M and investments in affiliates only ~$2M .

What Went Wrong

  • Pricing pressure drove YoY declines: revenue down to $27.7M (from $47.1M), realized price $878/dmt (vs $1,624/dmt) and gross margin 9.6% (vs 50.4%) .
  • Guidance lowered: FY24 shipments cut to 102K–116K from 126K due to customer timing and cost-optimized co-mingling, pushing revenue recognition into Q1’25 .
  • Continued net loss: GAAP net loss $(16.7)M and adjusted net loss $(8.1)M as restructuring/impairment ($4.6M) and equity securities gains/losses impacted results .

Financial Results

Core Financials vs Prior Quarters (oldest → newest)

MetricQ1 2024Q2 2024Q3 2024
Revenue ($USD Millions)$13.4 $13.2 $27.7
Diluted EPS ($)$(1.22) $(0.69) $(0.86)
Gross Profit ($USD Millions)$0.7 $0.6 $2.7
Gross Margin (%)5.2% 4.7% 9.6%
Adjusted Net (Loss) Income ($USD Millions)$(11.9) $(12.7) $(8.1)
Adjusted Diluted EPS ($)$(0.61) $(0.65) $(0.42)
Adjusted EBITDA ($USD Millions)$(12.4) $(13.2) $(8.7)

YoY Snapshot

MetricQ3 2023Q3 2024
Revenue ($USD Millions)$47.1 $27.7
Diluted EPS ($)$1.19 $(0.86)
Gross Profit ($USD Millions)$23.8 $2.7
Gross Margin (%)50.4% 9.6%

Operational KPIs and Realizations

KPIQ1 2024Q2 2024Q3 2024
Concentrate Shipped (dmt, thousands)15.5 14.0 31.5
Realized Price ($/dmt)$865 $945 $878
Realized Cost of Sales ($/dmt)$799 $900 $794
Weighted Avg Li2O (%)5.5% 5.5% 5.4%
NAL Production (dmt, thousands)40.4 49.7 52.1
NAL Mill Utilization (%)—83% 91%
NAL Recovery (%)—68% 67%
Cash & Equivalents ($USD Millions)$71.4 $59.0 $64.4

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Shipments (dmt, thousands)FY 2024126 102–116 Lowered
Shipments (dmt, thousands)Q4 202463–67 41–55 Lowered
Capital Expenditures ($M)FY 202412–14 11–12 Lowered
Capex ($M)Q4 20241–2 <1 Lowered
Investments & Advances to Affiliates ($M)FY 202433–36 27–29 Lowered
Investments & Advances ($M)Q4 20245–6 2–4 Lowered

Management noted shipment deferrals from Dec 2024 into Jan 2025 to co-mingle with JV cargo, citing ~$1.3–$1.4M transport cost savings and accretion to 2025 shipment totals .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 & Q2)Current Period (Q3)Trend
Commercial strategy/pricingPivot to prioritize long-term contracts; H2’24 shipments weighted to contracts; realized prices recovering from Q1 provisional impacts Futures contango leveraged; SC6 eq price $976; consolidation with JV to reduce freight; industry-leading realized pricing Improving execution and realizations
NAL operations/costsAchieved steady-state in June; mill utilization 83%, recovery 68%; crushed ore dome commissioned; production +23% QoQ Production record 52.1K dmt (+5% QoQ); utilization 91%; recovery 67%; unit costs down 15% QoQ ex inventory Operational metrics improving; costs trending down
Cost savings/OpEx discipline2024 plan targeted ~$10M; workforce reduction 28% by Q1; capex/investments to decline H2 Savings raised to ~$14M; workforce down 48% YTD; restructuring/impairment $6.7M YTD; liquidity enhanced via $25M facility Deeper cuts and improved liquidity
Carolina Lithium permitting/fundingState mining permit (May); exploring partnerships & government financing; air permit under review 45X final rule positive; air/water permits targeted H1’25; pursuing strategic partner and eventual ATVM re-application Regulatory momentum; funding path clarified
Ewoyaa (Ghana)Funding advisor engaged; offtake-partnering targeted; lease ratification pending EPA and Mine Operating Permits obtained; parliamentary ratification pending; exploring DFC-style project-level debt Regulatory progress; financing strategy evolving
Market dynamicsQ2: prices at 2024 lows; EV demand growth strong CEO highlights supply cuts, demand growth (EV >1M units/month), consolidation/M&A; spodumene prices up ~$70 in ~11 days Constructive medium-term view

Management Commentary

  • “We were able to execute a record quarter of customer deliveries while also improving profitability per ton… hedging against the futures market resulted in a realized price… one of the best in the industry.” — CEO Keith Phillips .
  • “We expect to exceed Q3’s shipment record in Q4’24 to round out an excellent second half of the year.” — CEO .
  • “We achieved $14 million in annual cash cost savings… workforce reduction in 2024 to 48%.” — CFO Michael White .
  • “The new guidance [45X] supports the application of the 10% manufacturing credit… should materially improve the after-tax economics of U.S. projects like Carolina Lithium.” — CEO .
  • “We ended the quarter with $64.4 million in cash… net proceeds from the credit facility were $18 million.” — CFO .

Q&A Highlights

  • Shipment timing: Management leaning toward deferring a December cargo to January to save ~$1.3–$1.4M in transport costs via co-mingling with JV cargo; accretive to 2025 shipments .
  • Hedging/pricing: Company benefits from trading partner hedges to lock fixed prices in contango futures; SC6-equivalent realized price $976/ton in Q3; 2025 primarily long-term contracts with spot flexibility .
  • Carolina Lithium: Air/water permits expected H1’25; partner preferred to bring capital/operating expertise; ATVM re-application planned after pre-application process .
  • NAL costs: Clarified cash costs ex inventory adjustments; expect further improvements as mining moves beyond legacy underground workings by ~2026 .
  • Ewoyaa financing: Project-level debt with DFC considered to minimize equity; parliamentary ratification of mining lease expected H1’25; Ghana SWF $28M investment triggers post-ratification .

Estimates Context

  • S&P Global Wall Street consensus EPS and revenue estimates were unavailable for PLL due to missing CIQ mapping in the data source; therefore, a direct comparison vs consensus could not be provided [GetEstimates tool error].
  • Company provided no EPS or revenue guidance; near-term estimates may need to incorporate Q4 record shipments (41K–55K dmt), lower FY capex ($11–$12M), and reduced FY investments ($27–$29M), with some shipment timing pushed into Q1’25 .

Key Takeaways for Investors

  • Operational momentum is strong: NAL utilization at 91% and costs improving, supporting shipment growth and margin stabilization into Q4 despite weak lithium prices .
  • Commercial execution is a differentiator: Futures contango and JV consolidation delivered industry-leading realized prices; expect continued optimization of freight and pricing structures .
  • Guidance reduction is timing/cost-driven: FY24 shipments cut to 102K–116K due to deferrals that are accretive to 2025; traders should anticipate lumpy quarterly revenue recognition .
  • Balance sheet/liquidity improved: $64.4M cash and $25M working capital facility enhance flexibility during downcycle; capex and JV funding substantially reduced vs 2023 .
  • Regulatory and strategic catalysts: 45X final rule benefits Carolina; Ewoyaa permits advanced with parliamentary ratification pending; potential DFC-backed debt could de-risk funding .
  • Risk monitor: Persistent price pressure vs PY, continued GAAP losses, and shipment timing variability; note external shareholder legal “alerts” that could weigh on sentiment .
  • Medium-term thesis: Supply curtailments and accelerating EV/ESS demand support a constructive outlook; PLL’s multi-asset pipeline (NAL brownfield, Ewoyaa, Carolina) offers leverage to recovery .