Lithium miner Pilbara Minerals has cut spending on its longer-term expansion projects after a crash in full-year net income that was driven by plunging prices for the battery metal.

Capital expenditure will be reduced to A$615-million to A$685-million this financial year, from $865-million in the 12 months through June 2024, the Australian miner said in a filing on Monday. A mine and concentrate plant at its Pilgangoora project are on budget and remained on track for completion in the 2025 financial year, it said.

Two additional growth projects will be put on hold until commodity prices recover, CEO Dale Henderson said in an interview with Bloomberg TV. These include the Salinas lithium mine in Brazil and a planned further expansion at Pilgangoora, to make it the biggest lithium mine in the world. Salinas has just been acquired by Pilbara, as part of its recent purchase of Latin Resources for A$560-million.

“The timing’s worked out well in terms of where the Latin project is, and also where the market is,” Henderson said. “There’s no cash drawdown, importantly, and we can preserve our balance sheet to manage the staged growth when we think it makes the most sense to not only bring the Salinas project to life, but also back at our Pilgangoora base.”

Pilbara reported an 89% drop in net income in the year through June to $257-million, it said Monday. That reflected a 70% plunge in Chinese lithium carbonate prices over the period, driven by a slowdown in electric vehicle sales growth and a flood of supply of the battery metal. Prices aren’t expected to recover anytime soon, with UBS Group AG cutting its forecasts through 2027.

The planned Pilgangoora expansion could add 115 000 t/y of lithium carbonate to the market, an increase of around 5% of current global supply, Jefferies analyst Mitch Ryan said in a note. That could “exacerbate current oversupply issues,” he said.

Pilbara’s share price has slumped by around a third over the past year, making it a possible takeover target. The company’s stock declined 0.2% to A$2.98 as of 2:05 p.m. in Sydney.

The miner had not been approached by any potential suitors, but “if an offer was to come through, of course the board would give it due consideration,” Henderson said.