Lynas Rare Earth clocks 90% drop in annual profit, flags Texas plant doubts
Investing.com-- Australia’s Lynas Rare Earths Ltd (ASX:LYC) clocked a bigger-than-expected slide in its fiscal 2025 earnings on Thursday, while also casting doubts on the future of a planned processing plant in Texas.
Lynas’ net profit after tax slid 90% to A$8 million ($5.20 million) from A$84.5 million a year ago. The print was also lower than Reuters estimates of A$30.4 million.
The sharp profit drop came as Lynas logged substantially higher selling costs in the year, while depreciation costs at key projects Kalgoorlie and Mt Weld also weighed.
Lynas flagged “significant uncertainty” over whether construction of the heavy rare earth processing facility at Seadrift, Texas, will proceed. The company said it is negotiating with the U.S. Department of Defense to reach a “mutually acceptable” offtake agreement, although there was no guarantee this could be achieved.
Lynas is the largest rare earth producer outside China, and is a key point of focus for the U.S. in sourcing the materials without relying on Beijing. The company and other Australian rare earth producers are expected to benefit greatly from U.S. attempts to diversify the rare earth supply chain.
Separately, Lynas announced a A$750 million equity raising, aimed at supporting growth over the next five years.
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