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    LYC   AU000000LYC6

LYNAS RARE EARTHS LIMITED

(LYC)
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Delayed Quote. Delayed Australian Stock Exchange - 01/28 12:10:09 am
8.92 AUD   -0.78%
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Australia rare earth miner Lynas eyes legal options on Malaysia plant review

12/04/2018 | 09:18pm EST
Rare earth oxides praseodymium and neodymium are pictured in the final stage of production at Lynas' Advanced Materials Plant in Gebeng, Malaysia

KUALA LUMPUR/MELBOURNE (Reuters) - Australian rare earths miner Lynas Corporation said on Wednesday that it would consider legal options after Malaysia added new conditions to licence renewals for its $800 million plant in the country, sending Lynas shares sharply lower.

The reaction came after Malaysia's Energy and Environment Ministry said on Tuesday the miner must comply with new conditions regarding waste management, ahead of the expiry of two licences next year, one of which included the export of radioactive residues.

Lynas is the only major miner outside China of the rare earth elements, metals that are crucial in the production of computers and mobile phones. It mines raw materials in Western Australia which are sent to its Malaysian plant for processing.

"Lynas' licence conditions explicitly state that residues should be recycled, and if that fails, then they should be sorted in a permanent disposal facility. Export should only be considered if (that) is not possible," it said in a statement.

"We will consider all options available to us to achieve an appropriate outcome...including legal options."

Its temporary storage licence for radioactive residue in Malaysia is up for renewal in September 2019, while its approval for non-radioactive waste storage is valid until February 2019. Shares in Lynas tumbled as much as 26 percent on the Australian bourse before recouping some losses: by 0151 GMT they were trading 19 percent lower at $A1.715.

The miner has garnered a global spotlight amid rising trade tensions between China and the United States, and a drop-off in Chinese rare earth exports this year.

Its plant on the east coast of peninsular Malaysia began operations in 2012 after long delays caused by legal challenges and environmental disputes. Tuesday's rulings came after the completion of an environmental audit of the processing plant.

The Malaysian ministry said it was concerned about the growing amount of accumulated residue at Lynas' open landfill temporary site that could be hit by major flooding or other natural disasters, citing risk to the surrounding communities and environment.

Despite the hit to Lynas shares, some analysts remained optimistic on the plant's future.

"Our initial take is of cautious optimism as critically the plant is not being shut down and is fully compliant with all regulations," said broker CLSA in a report.

Even if Lynas was required to export its waste back to Australia, any cost impact would be limited given the low levels of radioactivity present in the residues mean the waste can be transported by regular container ships, and the miner has access to a rehabilitation fund to pay for it.

"In our view, this largely absolves the political risk which has been a key reason to not own the stock," CLSA added, maintaining its "buy" recommendation on the stock.

(Reporting by Liz Lee in KUALA LUMPUR and Melanie Burton in MELBOURNE; Editing by Kenneth Maxwell and Manolo Serapio Jr.)

By Liz Lee and Melanie Burton


ę Reuters 2018
Stocks mentioned in the article
ChangeLast1st jan.
AMP LIMITED 2.30% 0.89 Delayed Quote.-13.86%
GOLD -0.13% 1795 Delayed Quote.-1.75%
LYNAS RARE EARTHS LIMITED -0.78% 8.92 Delayed Quote.-11.60%
SILVER -1.21% 22.465 Delayed Quote.-2.36%
THE GLOBAL LTD. 1.76% 173 Delayed Quote.-3.95%
All news about LYNAS RARE EARTHS LIMITED
01/26Ord Minnett rates LYC as Lighten
AQ
01/19Lynas Rare Earths Logs $146 Million Sales Revenue in Fiscal Q2
MT
01/18Australian shares fall as Wall Street weakness batters tech stocks
RE
01/18Australia's Lynas posts record revenue on strong demand for rare earths
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2021Australia's Lynas gets regulator nod for disposal facility in Malaysia
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Analyst Recommendations on LYNAS RARE EARTHS LIMITED
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Financials
Sales 2022 864 M 604 M 604 M
Net income 2022 462 M 323 M 323 M
Net cash 2022 718 M 502 M 502 M
P/E ratio 2022 17,5x
Yield 2022 -
Capitalization 8 050 M 5 630 M 5 629 M
EV / Sales 2022 8,48x
EV / Sales 2023 6,49x
Nbr of Employees -
Free-Float -
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Lynas Rare Earths Limited Technical Analysis Chart | LYC | AU000000LYC6 | MarketScreener
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Income Statement Evolution
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Mean consensus OUTPERFORM
Number of Analysts 7
Last Close Price 8,92 AUD
Average target price 10,15 AUD
Spread / Average Target 13,8%
EPS Revisions
Managers and Directors
Amanda M. Lacaze Chief Executive Officer, Executive Director & MD
Gaudenz Sturzenegger Chief Financial Officer
Kathleen Marie Conlon Non-Executive Chairman
Philippe G. Etienne Independent Non-Executive Director
John Scott Humphrey Independent Non-Executive Director