Pilbara Minerals Ltd (ASX: PLS) Share Price and News

Introduction to Pilbara Minerals (ASX:PLS)

Pilbara Minerals is an ASX-listed lithium miner. It owns and operates thе Pilgangoora spodumene minе in Wеstеrn Australia. Thе Pilgangoora dеposit is not only vast, with a recently updated resource sizе of 413.8Mt grading 1.15% Li2O, but also has an abovе-avеragе gradе which is a critical factor in the efficient extraction of lithium.

The company's project lies 120km from Port Hedland and is one of the largest deposits of lithium spodumene and tantalum in the world. Indeed, the company's 2025 production figures made it the 3rd largest behind QRM and Albemarle. Spodumene is the mineral that yields lithium while tantalum is valuable for its use in electronics and alloy metals given its corrosion-resistant properties.

Pilgangoora is a hard rock project, which is costlier to mine than underground brine deposits. But beggars for lithium cannot be choosers. Only hard rock lithium can convert directly to lithium hydroxide – the chemical that might be needed over lithium carbonate to improve energy density in batteries in the years ahead.

Pilbara also owns the Colina Project in Brazil, which it picked up by acquiring Latin Resources for $560m in an attempt to diversify the company beyond Pilgangoora. The Colina project is in the Minas Gerais district of Brazil and has a maiden mineral resource of 45.2Mt at 1.32% lithium oxide.

Pilbara Minerals' Company History

Pilgangoora began commercial production back in April 2019. The first 12 months were tough because of the oversupply in the lithium market and, in early 2020, the Corona Crash. But the share price recovered in conjunction with the lithium price and increased demand for electric vehicles. Governments have made their carbon emission targets clearer, ushering in a new era of electric powered transportation. And the rise of Tesla has led to almost all other car manufacturers scrambling to catch up.

Pilbara Minerals timed its run perfectly, signing a five-year offtake agreement with Chinese lithium producer Yibin Tianyi back on 25 March 2020. And in October of that year, it bought the Altura Lithium Operations for US$175m, expanding the Pilgangoora operation and leveraging the lithium price recovery. Beyond its lithium resource, the company is building a 6MW solar farm at Pilgangoora and has a joint venture agreement with POSCO to develop a lithium hydroxide conversion facility in South Korea.

In FY23, Pilbara Minerals made $4.1bn in revenue, up from $1.2bn just 12 months prior, off the back of 607.5kt in lithium shipped, up 68% from the year before – at an average lithium price of 87% higher than the year before. The company’s post-tax profit came in at $2.4bn, up from $0.6bn just a year earlier and it paid a dividend of 25c per share. It closed the period with a $3.3bn cash balance.

But in 2024, lithium prices crashed - PLS' realised price was down 74% in 12 months from US$4,447/t to US$1,176/t. And so its revenues fell 69% to $1.25bn and its profit shrank over 85% to be $318m on an underlying basis and $257m on a statutory basis. FY25 was little better, but there are signs FY26 could be a better year as lithium prices recover. Its NPAT was 147% higher than 12 months prior and the company also increased production while reducing operating costs.

Future Outlook of Pilbara Minerals

The future outlook for the company will be shaped by how lithium prices evolve, the inherent quality of its assets, and the practical timeframes required to bring new mining capacity online.

The signs of a positive market, driven by tighter supply and sustained battery demand, can help underpin future producer economics. It is not as if new mines can be turned on like a tap - having such a large mine will put PLS in a strong position. But execution and commodity prices will remain important determinants of the company's fate.

Is Pilbara Minerals a Good Stock to Buy?

Pilbara Minerals could be attractive for investors who believe in a recovery cycle in lithium prices and are prepared to hold through cyclical downturns, as the company’s asset base, production scale, and cost position are strong relative to many peers.

Conversely, if you prioritise stable cash flows and dividends short-term, or if you are wary of commodity price swings, it might be prudent to take a more cautious stance or wait for clearer pricing signals before increasing exposure.

Always consider your own financial situation and, if needed, consult a financial advisor before making investment decisions.