PLS yet to lock in return of dividends despite generating most cash in a quarter since 2023 lithium bubble

Australia’s biggest lithium pure-play is back to printing money, boosting its bank balance by $501 million during the first three months of 2026. A 61 per cent quarter-on-quarter rise in spodumene concentrate prices underpinned an operational cash margin of $461m from revenue of $567m for West Perth-based PLS. Spodumene concentrate production from its Pilgangoora mine near Port Hedland rose 16 per cent to 232,400 tonnes but sales were down 12 per cent to 195,000t. PLS boss Dale Henderson said the sales numbers were lower due to “logistics timing”, including shipping delays caused by two cyclones. In February PLS struck a 150,000t-a-year offtake agreement with battery manufacturer Canmax Technologies, in a deal that includes a guaranteed price floor and a $US100m pre-payment from Canmax. PLS was sitting on $1.46 billion of cash by the end of March and its $501m increase was the highest for a quarter since mid-2023. Back then, a lithium demand bubble catapulted prices to dizzying heights and saw PLS accumulate more than $3b in its coffers. A recent swathe of mine closures and burgeoning demand for battery energy storage systems sparked a resurgence in lithium prices. Despite PLS’ fast-growing cash pile, Mr Henderson said the company would not rush to bring dividends back for the first time since 2023. “We have a principle of maintaining strong balance sheet, we’ve seen that as a key differentiator for PLS in the market,” he told The West Australian. “It’s great to see the strong tailwinds we’re seeing with the market, but of course we can’t be sure of the future. Ultimately, it [bringing back dividends] will be down to sustained free cash flow generation.” PLS is planning to significantly expand production at Pilgangoora to capitalise on the rebound. The Ngungaju processing plant is set to be restarted in July 2026 after being in care and maintenance since late 2024. “Recruitment activities for the restart are progressing well, with several key operational team members already relocating back to the Ngungaju plant to support early commissioning preparation and operational readiness,” PLS stated on Friday. PLS has been able to promptly fill dozens of roles for Ngungaju’s restart thanks to the recent closure of Albemarle’s Kemerton lithium hydroxide plant. PLS also told shareholders it feels insulated from Iran war supply shocks. “Diesel is a small component of the operating cost base under normal supply circumstances, representing approximately 4 to 5 per cent of total production cash costs in the March quarter,” the company said. “PLS does not foresee any immediate supply constraints for other key inputs, including explosives and processing reagents, and continues to work closely with suppliers to ensure continuity of operations. “In addition, key transportation contractors have indicated to PLS that they do not anticipate supply constraints at this time.” Shares in PLS hit a record of $6.14 on Monday. It was up 3 per cent at $5.86 by 10.15am on Friday.