The IGO Ltd (ASX: IGO) share price is having another difficult session on Thursday.
At one stage today, the battery materials miner's shares were down as much as 7.5% to a new multi-year low of $4.30.
The company's shares have since recovered a touch but are still trading almost 5% lower at $4.42 at the time of writing.
Investors have been hitting the sell button in response to IGO's half year results release this morning.
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IGO share price sinks on half year results
- Revenue down 35% to $284 million
- Loss after tax of $782 million
- No dividend
What happened during the half?
For the six months ended 31 December, IGO reported a 35% decline in revenue to $284 million.
Management advised that this reflects the Nova Operation generating lower revenue than the prior period due to lower sales volumes and realised nickel prices. In addition, Forrestania reported lower revenue, with the operation transitioning into care and maintenance during the period.
Things were even worse on the bottom line, with IGO posting a worryingly large loss. The company revealed a net loss after tax of $782.1 million for the period. This compares unfavourably to a profit after tax of $288.3 million a year earlier. That profit was more than its entire revenue during this half.
Management advised that its reduction in profit was primarily due to the company's lower share of profits from the Tianqi Lithium Energy Australia (TLEA) joint venture. It decreased to a share of loss of $602.2 million for the six months from a share of profit $495.2 million in the prior corresponding period.
In addition, impairment charges on the company's exploration assets and lower operating results from the Nova and Forrestania operations weighed on its profits.
Nevertheless, the company has a strong balance sheet. At the end of the half, IGO had a cash balance of $247 million with $720 million of undrawn debt.
'Significant challenges'
IGO's managing director and CEO, Ivan Vella, acknowledged that the company's headline result was disappointing, but highlighted the progress it has made towards strategic initiatives. He said:
While our headline financial results for the half-year reflect a number of significant challenges we've faced, I am proud of the difficult and disciplined decisions we've made as a business to address these challenges with clear commercial outcomes in mind, and for the progress we've made toward implementing our strategic initiatives.
Over the first half of FY25, we have successfully achieved progress across many of the priority areas we identified.
Looking ahead, I am very clear on our priorities to drive stakeholder value and I have every confidence that we have the team, strategy, values and ambition to achieve success into the future.
The IGO share price is down 35% over the past 12 months.
