BRISBANE - Allkem Limited (ASX|TSX: 'AKE', the 'Company') provides an update on its global lithium portfolio, business activities and financial position1 as at 30 June 2022.

HIGHLIGHTS

Mt Cattlin achieved record financial year production of 193,563 dry metric tonnes ('dmt') of spodumene concentrate in FY22

In the June quarter, 24,845 dmt of spodumene concentrate was produced and 37,837 dmt was shipped, generating record revenue of US$188.9 million with a gross cash margin of 84% based on cost of production and average pricing of US$4,992 /dmt CIF for SC 5.4%

Customer demand in the spodumene market remains robust and spodumene concentrate pricing in the September quarter is expected to be higher than the June quarter

Annual production at the Olaroz Lithium Facility2 reached a new record of 12,863 tonnes of lithium carbonate for FY22, 47% of which was battery grade material in line with targets

During the quarter production and sales of lithium carbonate were 3,445 tonnes and 3,440 tonnes respectively. This generated record revenue of US$141 million with a gross cash margin of 90% based on average pricing of US$41,033/tonne FOB3 (45% battery grade lithium carbonate)

The lithium carbonate sales price for the September quarter is expected to remain similar to that of the June quarter

DEVELOPMENT PROJECTS

Olaroz Stage 2 reached 88% completion with first production expected in late H2 CY22. Total Allkem resources at the Olaroz and immediately adjacent Cauchari basins are now 22.5 Mt LCE in all resource categories, making it one of the largest lithium resources in the world

At Naraha, plant commissioning activities including water testing have been undertaken and first production is expected by late September

The first pond at Sal de Vida ('SDV') Stage 1 is complete and filled with brine. Construction of the first two strings of ponds has reached 32% completion with first production expected in H2 CY23. During the quarter the SDV development plan was restated with a 40% increase in production to 45ktpa in two stages. A 10% increase in the resource to 6.85Mt LCE has also been defined

At James Bay, the clarification process for the ESIA continues at both Provincial and Federal levels in conjunction with the Cree Nation

FINANCIALS AND CORPORATE

Strong operating performance and high sales prices have delivered record group revenue4 for the quarter of approximately US$337 million and a group gross operating cash margin1 of approximately US$292 million (A$0.67/share for the June quarter)

Group revenue for FY22 (including Mt Cattlin from merger date, 25 August 2021) was US$762 million and group gross operating cash margin for the same period was approximately US$594 million (excluding corporate and other non-operating costs)

At 30 June group cash5 was US$663.2 million, an increase of US$213.1 million from 31 March 2022

Strong cashflow and a robust balance sheet are expected to fund delivery of an aggressive growth strategy to increase production threefold by 2026 and to maintain 10% market share. The increase in production will be underpinned by the forecast growth in demand needed for the transition to electric vehicles

The business is entering a period of significant growth with Olaroz Stage 2 and Naraha to begin production later this year, Sal de Vida to commence production in 2023 and James Bay in 2024

Three new senior executives have joined the business in Project Development, Sustainability and Sales/Marketing to support delivery of the growth strategy

SUSTAINABILITY

In June Allkem became a constituent company in the FTSE4Good Index Series. The FTSE4Good is designed to identify companies that demonstrate strong environmental, social and governance ('ESG') practices measured against globally recognised standards.

Allkem also achieved the highest available 'Comprehensive' rating in the Australian Council of Superannuation Investors'('ACSI') annual detailed assessment of ESG reporting in ASX200 companies. This rating acknowledges ongoing reporting of material ESG risks and mitigation strategies, and transparency in reporting targets and performance. Established in 2001, ACSI provides a strong, collective voice on ESG issues on behalf of their members including 29 Australian and international asset owners and institutional investors managing more than $1 trillion in assets.

The Respectful Workplace Behaviours program was rolled out to all Australian based personnel including all employees and contractors at the Mt Cattlin operation. In partnership with Allkem's Employee Assistance Provider, 17 workshops have been conducted covering areas such as psychosocial hazards, sexual harassment, discrimination and bullying.

Safety performance

Allkem achieved its best results since the merger with a Total Recordable Injury Frequency Rate of 2.6 recorded at the end of the June quarter, a 23% improvement from the prior quarter and a Lost Time Injury Frequency Rate of 1.0 for the rolling 12 months. Two separate Recordable Injuries occurred during the quarter at the Mt Cattlin operations. Both contractor employees have fully recovered and returned to work and investigations have been completed with corrective actions implemented.

There was an increase in reported Significant Potential Incidents at operations over the quarter, indicating reporting maturity and improving recognition of near miss events as serious incidents. A Critical Control Management program was implemented at Mt Cattlin and Sales de Jujuy continued the implementation of a Behavioural Based Safety module.

COVID-19 response

COVID-19 cases impacted Mt Cattlin mine site over the quarter with the peak caseload of the Omicron variant in Western Australia occurring in May. Contractors and personnel followed site Biosecurity Protocols which were updated in line with government recommendations.

Biosecurity Protocols across the global operations remained in place and the impact of COVID-19 diminished proportionally to those countries' case numbers.

Contact:

Tel: +61 7 3064 3600

Web: www.allkem.co

Forward Looking Statements

Forward-looking statements are based on current expectations and beliefs and, by their nature, are subject to a number of known and unknown risks and uncertainties that could cause the actual results, performances and achievements to differ materially from any expected future results, performances or achievements expressed or implied by such forward-looking statements, including but not limited to, the risk of further changes in government regulations, policies or legislation; the risks associated with the continued implementation of the merger between the Company and Galaxy Resources Ltd, risks that further funding may be required, but unavailable, for the ongoing development of the Company's projects; fluctuations or decreases in commodity prices; uncertainty in the estimation, economic viability, recoverability and processing of mineral resources; risks associated with development of the Company Projects; unexpected capital or operating cost increases; uncertainty of meeting anticipated program milestones at the Company's Projects; risks associated with investment in publicly listed companies, such as the Company and risks associated with general economic conditions.

Subject to any continuing obligation under applicable law or relevant listing rules of the ASX, the Company disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements in this Release to reflect any change in expectations in relation to any forward-looking statements or any change in events, conditions or circumstances on which any such statements are based. Nothing in this Release shall under any circumstances (including by reason of this Release remaining available and not being superseded or replaced by any other Release or publication with respect to the subject matter of this Release), create an implication that there has been no change in the affairs of the Company since the date of this Release.

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