PLS Group, Australia's largest lithium producer, has signaled that the battery metal could face a supply shortage in the coming years, while revealing it is nearing a final investment decision on expanding its production capacity. The announcement accompanied the company's latest earnings report, which showed a return to profitability driven by recovering lithium prices.

For the 12 months ending June 30, marking the fiscal 2026 period, PLS Group posted a net profit of A$526 million (approximately US$377 million), reversing the previous year's loss. The turnaround was attributed to the rebound in prices for the key battery metal following an extended period of oversupply. However, the result fell short of the average analyst estimate.

The spodumene producer, which supplies a hard-rock type of lithium ore, has seen its fortunes improve as lithium prices have staged a recovery this year after several years of downturn. PLS Group Chief Executive Officer Dale Henderson expressed optimism about the price outlook, stating, "I think it's fair to say we've entered the next phase of the cycle. Given strong demand and continued subdued supply, I believe we are about to enter a very strong period."

Mr. Henderson also disclosed that the company will publish a study report on the expansion of its Pilgangoora project in Western Australia, dubbed "P2000," in the quarter ending December. He indicated that a final investment decision is planned shortly thereafter. "P2000 is the next phase of expansion for the company's Australian assets. It has the capacity to double production to 2 million tonnes per annum," he explained.

While PLS Group is prioritizing organic growth, Mr. Henderson noted that the company has not ruled out pursuing growth through mergers and acquisitions. The company's focus remains on expanding its existing operations as it positions itself to capitalize on the anticipated tightening in global lithium supply.