Rare-earth mining company Lynas Corporation took a hit on the ASX today closing down 17.07% to $0.17 a share.
The company, which has been plagued by production issues and cash flow problems since opening a refinery in Malaysia, released its quarterly activities report today and the market wasn’t impressed.
Part of the problem is the falling average selling price of rare earths which in the June quarter fell more than $4 to $18.25 a kilo.
Attempting to plug liquidity issues, Lynas also ran a $40 million capital raising in the three months to June 30.
If cashflow, activism and falling commodity prices weren’t enough for the miner to deal with, it has also had some management issues. Company CEO Eric Noyrez threw in the towel in June after a little over a year with the miner.
The company’s share price has been grinding higher this financial year and was starting to recoup some ground – until today.
Lining up against rare-earth producing majors in China was never going to be an easy battle. The company appears to be beginning to come to terms with just how difficult this is and is now flagging job cuts, shifting its head office from Sydney to Kuala Lumpur and seeking refinancing options.
Rare earth is an input used in most electronics, including smartphones, tablets and laptops.