Is ASX 200 lithium player Lake Resources profitable?

Lithium has been the talk of the S&P/ASX 200 Index (ASX: XJO) in 2022, and shares in Lake Resources NL (ASX: LKE) have received particular attention.

The company was added to the iconic index in June after its value surged by more than 40% over the first six months of the year. Since then, it has fallen by around 20% amid its boss’ resignation, a short seller attack, and a dispute between the company and its joint venture partner.

The Lake Resources share price is $1.037 at the time of writing.

But is the ASX 200 lithium share profitable? Keep reading to find out.

Is ASX 200 lithium share Lake Resources profitable?

Those hopeful Lake Resources could be a profitable ASX 200 lithium share will be disappointed to learn it’s still operating in the red.

The majority of the company’s efforts go towards its wholly owned Kachi Lithium Brine Project, located in Argentina.

The project is expected to produce 50,000 tonnes of battery-quality lithium carbonate each year, as per its pre-feasibility study.

The company is also looking to double the project’s capacity. It’s pushing on with a drill campaign to help support its case.

But exploration and development bring plenty of costs. And, as the company isn’t producing any lithium to sell, it doesn’t yet have any income.

The company posted a $5.68 million loss for financial year 2022 ­– representing a 51-cent loss per share.

It also revealed an outflow from operating activities amounting to $8.68 million for the 12 months ended 30 June. Though, Lake Resources received $174 million from issuing shares.

All in all, the company ended last financial year with $175.4 million of cash and no debt. That leaves it financed through to the final investment decision on the Kachi Project.

The post Is ASX 200 lithium player Lake Resources profitable? appeared first on The Motley Fool Australia.

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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