Pilbara Minerals to hit dividend status in FY23: What does the payout look like?

Wed 16 Nov 22, 11:44am (AEST)
Mountainous mine site
Source: iStock

Key Points

  • Pilbara Minerals will start paying dividends in FY23
  • The company is targeting a payout ratio between 20-30% of free cash flow
  • Based on Macquarie's FY23 earnings estimates, the dividend could sit between 19.7 cents to 30 cents per share

When you're selling cargos of lithium spodumene for US$8,000 a tonne and sitting on $1.4bn in cash, its unsurprising to see Pilbara Minerals (ASX: PLS) declare an inaugural dividend payment for FY23.

The largest ASX-listed lithium miner announced the details of a Capital Management Framework, which seeks to strike a balance between working capital, investment into growth initiatives and paying a sustainable dividend to shareholders.

The Framework is targeting a payout ratio of 20-30% of free cash flow, designed to 'provide a sustainable dividend return'.

"With strong cashflows being generated, it is pleasing to be in a position to seek to return value to our shareholders so early in our operational life via a maiden fully franked dividend for the 2023 Financial Year," said Managing Director Dale Henderson.

Macquarie's FY23 estimates

Macquarie analysts forecasted the following financials for Pilbara Minerals in FY23:

Full year



% change

Revenue ($m)




Adjusted net profit ($m)




Free cash flow ($m)




Source: Macquarie Research | Table: Market Index


Under the 20-30% dividend payout ratio and Macquarie estimates, Pilbara Minerals would be paying out between $598m to $898m in FY23.

The company currently has approximately 2.99bn shares on issue, which suggests a dividend per share between 19.7 cents to 30 cents.

Of course, FY23 actuals could be dramatically different, subject to changes in lithium prices, production and shipments, costs and other factors.

Growth opportunities

Pilbara Minerals produced 377,902 tonnes of spodumene in FY22 and targeting 540-580,000 tonnes in FY23.

The capital management framework noted future growth opportunities to which 'capital might be allocated in the near-term' include:

  • P680 Project: Expands production capacity at the Pilgangoora Project to 680,000 tonnes of spodumene concentrate. This project is currently in development

  • P1000 Project: Further expand production capacity at Pilgangoora to 1m tonnes per annum. A final investment decision is expected for P1000 later this year

  • Downstream JV with POSCO: A potential 43,000 tonne per annum lithium hydroxide monohydrate chemical facility in South Korea

Pilbara Minerals share price chart
Pilbara Minerals share price chart


Related Tags

Written By

Kerry Sun

Content Strategist

Kerry holds a Bachelor of Commerce from Monash University. He is an avid swing trader, focused on technical set ups and breakouts. Outside of writing and trading, Kerry is a big UFC fan, loves poker and training Muay Thai. Connect via LinkedIn or email.

Get the latest news and insights direct to your inbox

Subscribe free