Australian lithium and nickel miner IGO has reported a stronger financial and operational performance in the June quarter, underpinned by improved production and lower costs at its Nova and Greenbushes assets. However, ongoing issues at the Kwinana lithium hydroxide refinery continue to weigh on the company’s downstream ambitions.

Fourth-quarter underlying earnings before interest, taxes, depreciation and amortisation (Ebitda) rose to A$62-million, nearly doubling from A$34-million in the previous quarter. IGO also delivered positive cash flow from operating activities of A$4-million, although this was down from the prior quarter’s A$45-million, which included a one-off income tax refund. The company closed the financial year with net cash of A$280-million.

At the Greenbushes lithium mine, delayed shipments from the March quarter were fulfilled, boosting spodumene sales and contributing to a quarterly Ebitda margin of 60%. Meanwhile, at Nova, higher production and lower unit cash costs capped a strong second half for the 2025 financial year.

“IGO has implemented a range of safety and operational improvement initiatives over the course of the year. Our results this quarter show that these programmes are delivering results,” said MD and CEO Ivan Vella.

“I am delighted to see the continued reduction in the number and severity of injuries and incidents across the business. What is even more pleasing is seeing the increased rates of the leading indicators and the shifting safety culture.”

At Nova, IGO maintained life-of-mine production guidance of 15 000 t to 18 000 t of contained nickel, with production trending up in recent quarters.

“There has been considerable work done to understand the extremities of the orebody and how to proactively manage the difficulties associated with operating the asset to end of mine life,” said Vella. “This provides increased confidence that we have the plans and tactics in place to manage through this more difficult phase of operation as the mine comes to a close.”

Greenbushes will remain a cornerstone asset, with the 2026 guidance set at 1.5-million to 1.65-million tonnes of spodumene at a cash cost of $310/t to $360/t.

“Greenbushes is a world-class orebody and generated a strong margin in FY25,” said Vella. “There are plenty of challenges and opportunities as we focus on full optimisation and achieving maximum value from the asset.”

IGO and Tianqi Lithium Energy Australia currently share a 49% stake in Greenbushes, with Albemarle owning the balance. 

However, the outlook for downstream operations remains challenging. Production at the Kwinana lithium hydroxide refinery fell short of full-year guidance, and a further impairment of between A$70-million and A$90-million is expected, resulting in full impairment of Train 1.

“The Kwinana lithium hydroxide refinery operated well below nameplate capacity in the quarter and did not achieve guided production tonnes for the year,” Vella said. “Despite the strong commitment from the team at site to address operational problems and ongoing issues, IGO has low confidence in the ability of this asset to achieve meaningful, sustained improvement.”

He added that IGO and its joint venture partner continue to discuss the optimum pathway for the refinery to minimise further cash outflow.

The company is also progressing a shift in its exploration strategy, rationalising tenement holdings and focusing more tightly on high-impact discovery targets.