Investors are driving up the share price of Mineral Resources Ltd (ASX:MIN) with a notable 4.0% increase on Friday, following the company’s latest quarterly update. The company’s shares, which closed at AU$54.87 yesterday, are now trading at AU$54.11. This surge comes as the broader ASX 200 Index also sees a modest rise of 0.7% during the same period.
The recent boost in Mineral Resources' share price is attributed to the positive quarterly performance report for the period ending June 30. The update highlights a 9% increase in the company’s production volumes for its mining services division, reaching 269 million tonnes (Mt), which falls within the guidance range of 260 Mt to 280 Mt. This result is particularly significant as it reflects the company’s ability to meet its production targets.
However, the quarterly production volumes were down 12% from the previous three months, totaling 61 Mt. This decline was primarily due to reduced mine development activities at the Wodgina and Mt Marion sites. Despite this, the company's total iron ore shipments for the June quarter increased by 6% compared to the previous quarter, amounting to 4.8 million wet metric tonnes (wmt). For FY 2024, total shipments reached 18.1 million wmt, aligning with the company’s forecasted guidance.
The average realised price for iron ore across all sites during the quarter was US$94 per dry metric tonne (dmt), reflecting the company's stable pricing environment amid fluctuating market conditions.
In the energy sector, Mineral Resources has made significant strides, including the submission of two production licence applications for its Lockyer Gas Project. These applications pertain to declared location blocks over the Lockyer and North Erregulla gas fields, signaling the company's ongoing commitment to expanding its energy portfolio.
The company's lithium division also contributed to the positive market reaction. For FY 2024, spodumene concentrate production soared 40% year-on-year, reaching a record 328,000 dmt. In the June quarter alone, production was 89,000 dmt, consistent with the prior quarter. The company shipped 95,000 dmt of spodumene concentrate and sold 76,000 dmt, achieving a realised price of US$797/dmt on a 4.2% basis and US$1,178/dmt on an SC6 basis.
Improvements in spodumene product grade were noted, driven by enhanced plant performance and higher-quality ore feed, further bolstering investor confidence in Mineral Resources' lithium business.
Despite today's share price boost, the company has faced challenges over the past year, with its stock trading near 52-week lows and down 27% over the past 12 months. Nevertheless, the latest quarterly update provides a glimpse of resilience and potential, as Mineral Resources continues to focus on its core iron ore, lithium, and energy projects.