Piedmont Lithium (US:PLL)2024-02-23 00:58Financial Data and Key Metrics Changes - For full year 2023, the company reported a GAAP diluted earnings per share loss of $1.14 and an adjusted diluted earnings per share loss of $1.64, reflecting a $0.51 improvement compared to the prior year [11] - The company ended the year with $71.7 million in cash and cash equivalents, down from $99 million at the beginning of the year [52][24] - Full year revenue was $39.8 million, with a gross profit of $5.7 million, resulting in a realized price of $920 per metric ton and a realized cost of $789 per metric ton [29] Business Line Data and Key Metrics Changes - North American Lithium (NAL) produced nearly 99,000 tons and shipped more than 72,000 tons of lithium concentrate in 2023, with 43,000 tons sold to Piedmont [34] - In Q4 2023, NAL produced over 34,000 tons of concentrate, an increase of almost 3,000 tons compared to Q3 [55] - The company shipped 43.2 thousand dry metric tons of spodumene concentrate in the second half of 2023 [10] Market Data and Key Metrics Changes - The U.S. EV market saw 1.4 million vehicles sold in 2023, a 50% increase from 2022, with North American EV sales growing by 41% year-over-year in January [46] - The energy storage segment is expected to grow almost 50% in 2024, surpassing demand from the traditional portable market [69] - The lithium market is currently experiencing a downturn, with prices having fallen 85% to 90% from record highs in 2022 [65] Company Strategy and Development Direction - The company aims to be a leading supplier of lithium resources for the North American EV supply chain, focusing on hard rock production [3][22] - The company is prioritizing a prudent funding strategy while minimizing shareholder dilution, with plans to reduce spending by $10 million annually [14][48] - The Ewoyaa project in Ghana is planned to be a large spodumene producer with a high return on invested capital, and the Carolina Lithium project is designed for 30,000 tons of lithium hydroxide production [26][8] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the long-term future at NAL, citing exceptional drill results and the potential for further mine life extensions [25][18] - The company expects to achieve full production run rate at NAL within 2024, with improvements in production and unit operating costs anticipated [23][35] - Management believes that the current low price environment will eventually lead to a recovery in lithium prices, driven by strong demand growth in the EV industry [43][44] Other Important Information - The company reduced its workforce by 27% to manage costs and expects to record approximately $1 million in severance costs in Q1 2024 [14] - The company sold its holdings in Sayona Mining and a portion of its holdings in Atlantic Lithium for approximately $49 million in net proceeds [24][50] - The company is exploring non-dilutive project funding options to ensure leverage to the anticipated lithium price recovery [24][32] Q&A Session Summary Question: What is the environment for offtake and customers in the U.S.? - Management noted that customer interest remains high, with ongoing constructive conversations about pricing and potential floor pricing arrangements [90] Question: What are the final hurdles before permit completion for Carolina Lithium? - Management indicated that while the state reserves the right to ask additional questions, the current inquiries are straightforward and they expect to conclude the process soon [95] Question: How will cash cost improvements at NAL be achieved? - Management expects cash costs to improve significantly, potentially by C$400 to C$500 per ton, once strategic initiatives like the crushed ore dome are implemented [120]