Embattled lithium miner Galaxy Resources is trying to drum up support for its share price through an upbeat update this morning following its capital raising.
The stock inched up 0.5 cents to 5.9 cents, and while that doesn’t sound like much, it is a big 9% plus move on percentage basis.
But this won’t bring much comfort to those who participated in the company-saving equity raising at 8 cents a share, although they would be pleased to hear management reiterate its projections that the problem-plagued Jiangsu plant in China will hit breakeven on a cash flow basis before the end of this year.
Management is also paying down debt with proceeds from the $37.5 million capital raising, is cutting cost with a 50% cut in corporate headcount and has started looking at the development of the Sal de Via brine project in Argentina.
If the turnaround in Jiangsu comes to pass, Galaxy will be the largest lithium producer in the Asia Pacific at a time when demand for the material for use in batteries is buoyed by the growth in mobile electronics and electric cars.
Galaxy has shed 85% of its value this calendar year and is part of the Uncapped 100.