ASX-listed Liontown Resources ended its first year of operations at the Kathleen Valley lithium project with record quarterly net operating cash flow and continued progress toward transitioning to a fully underground operation.

The Australian lithium developer posted net positive operating cash flow of A$23-million for the June quarter, its third consecutive positive result, despite a 9% quarter-on-quarter drop in the average realised spodumene price to $740/dry metric tonnes, or dmt (SC6 equivalent).

Revenue for the June quarter came in at A$96-million, contributing to a year-to-date total of A$301-million. The company sold 97 330 dmt of concentrate at an average grade of 5.2%, generating A$109-million in receipts. Cash on hand stood at A$156-million as of June 30.

“We have delivered a strong finish to our first year of operations, with over 300 000 wet metric tonnes of spodumene concentrate produced, A$301-million in revenue secured and a breakeven net operating cash inflow from activities in a ramp-up year,” said MD and CEO Tony Ottaviano.

Underground production ramp-up continued on schedule, with stoping starting in April. Liontown commissioned Australia’s largest paste plant during the quarter and expects to complete ventilation infrastructure in the first quarter of 2026 financial year.

“This quarter we delivered our third consecutive quarter of positive net operating cashflow, of A$23-million, which was a record and a standout result given the sustained pressure on lithium prices,” Ottaviano said. “With lithium prices falling 24% ($203/t) during the quarter, our strategy to process stockpiles enabled us to preserve cash and maintain a strong cash balance at year end.”

While the company processed low-grade ore stockpiles with higher gabbro content during the period, resulting in lower recoveries, Liontown maintained more than 95% plant availability and expects a recovery improvement as underground ore feed increases. 

“We remain firmly on track for 100% underground production and 70% recovery target in the third quarter of the 2026 financial year,” Ottaviano added. “FY26 will be a transition year. Our focus is clear, we need to complete the underground transition, manage costs and cash tightly, and prepare the plant to fully leverage high-grade, low-contamination underground ore in the second half.”

A business optimisation programme has delivered A$112-million in cost savings and deferrals to date, exceeding the A$100-million target announced in November.