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Talison Lithium Reports First Quarter Fiscal Year 2013


Talison Lithium Reports First Quarter Fiscal Year 2013 Results

PERTH, WESTERN AUSTRALIA -- (Marketwire) -- 11/14/12 -- Talison Lithium Limited (TSX:TLH) ("Talison" or the "Company"), today announced its results for the three months ended September 30, 2012 ("First Quarter")(1) and an update of its lithium Mineral Resources and Mineral Reserves at its Greenbushes lithium operations in Western Australia (the "Greenbushes Lithium Operations").

The First Quarter results and update of its lithium Mineral Resources and Mineral Reserves estimates are each in-line with Talison's expectations, and the Talison Board reconfirms its unanimous recommendation that Talison Securityholders vote in favour of the acquisition by Rockwood Holdings, Inc, ("Rockwood") of all of the Talison securities by way of schemes of arrangement (the "Rockwood Transaction"), in the absence of a Superior Proposal.

The Independent Expert has confirmed that the updated lithium Mineral Resources and Mineral Reserves estimate announced today is not inconsistent with the valuation analysis undertaken as part of the assessment and therefore does not affect its conclusion that the Rockwood Transaction is fair and reasonable, and in the best interests of Talison Shareholders and Talison Optionholders, in the absence of a Superior Proposal.

FIRST QUARTER RESULTS

Highlights


 
--  Revenue of A$28.5m, a 10% increase on the corresponding period in the
    prior year ("q/q") 
--  EBITDA(2) of A$8.4m, a 38% q/q increase, and an EBITDA margin of 30% 
--  Net profit of A$4.7 million, a 190% q/q increase, and basic EPS of 4.3
    cents per share 
--  Average sales price for the first quarter was US$352 per tonne, an
    average 7% q/q increase consisting of an increase of 10% for technical
    grade lithium concentrates and 20% for chemical grade lithium
    concentrate offset by a change in sales mix 
 
----------------------------------------------------------------------------
HIGHLIGHTS                               Three Months ended                 
                                         Sept 30 (unaudited)                
(in thousands A$, unless noted                                              
 otherwise)                                  FY13         FY12    % Change  
Sales Volume (tonnes 
lithium                                                
 concentrate)                              82,410       80,315           3% 
Sales Price (Average US$/tonne)            US$352       US$330           7% 
Revenue                               $    28,478  $    25,879          10% 
Cash Operating COGS ($/tonne lithium                                        
 concentrate)                         $       202  $       207          (2%)
EBITDA(3)                             $     8,427  $     6,126          38% 
EBITDA Margin                                  30%          24%    +600bps  
Net Profit                            $     4,665  $     1,607         190% 
Basic EPS (cents/share)                       4.3          1.5         187% 
----------------------------------------------------------------------------

(1) Information in this press release is in relation to the unaudited condensed consolidated interim financial statements of Talison as at September 30, 2012 and for the three months ended September 30, 2012 (collectively, the "Financial Statements") and should be read in conjunction with Financial Statements. The financial information contained in this press release is derived from the Financial Statements, which were prepared in accordance with International Financial Reporting Standards ("IFRS"). All amounts in this press release are expressed in Australian dollars ("A$") unless otherwise identified. References to "C$" are to Canadian dollars and references to "US$" are to United States dollars.

(2) The term "EBITDA" is a non-IFRS financial measure. For further information and a reconciliation of EBITDA to its IFRS-compliant income statement, refer to "Non-IFRS Performance Measures" in Management's Discussion and Analysis of the financial condition and results of operations of Talison Lithium Limited as at September 30, 2012 and for the three ended September 30, 2012 (which can be found on Talison's SEDAR profile at www.sedar.com).

(3) Excludes A$1.2 million in non-recurring costs related to the proposed acquisition of Talison by Rockwood ("Acquisition Advisory Costs").

Revenue of A$28.5 million was generated in the quarter, a 10% increase over the corresponding period in the prior year.

EBITDA of A$8.4 million (excluding Acquisition Advisory Costs) increased A$2.3 million or 38% over the corresponding period in the prior year. EBITDA margin increased to 30%, compared to 24% in the corresponding period in the prior year. The increase in EBITDA was due to higher sales volume, an increase in the average sales price and a lower operating cost per tonne of lithium concentrate.

Net profit after tax of A$4.7 million, a 190% increase on the corresponding period in the prior year as a result of an increase in EBITDA and significantly lower net finance expenses.

Operating costs for the First Quarter were maintained at A$16.6 million. Operating cost per tonne of lithium concentrate decreased to A$202.

Cash and cash equivalents at the end of the First Quarter were A$81.0 million, an increase of A$6.8 million from the balance as at June 30, 2012.

LITHIUM MINERAL RESOURCES AND MINERAL RESERVES

Talison has updated its lithium Mineral Resources and Mineral Reserves as a result of surface drilling at the Greenbushes Lithium Operations, and the re-evaluation of the resource model based on updated commercial parameters following the completion of the Stage 2 expansion of the processing plant at the Greenbushes Lithium Operations.

The table below shows Talison's updated lithium Mineral Reserves estimate as of September 30, 2012 and previous estimate as of March 31, 2011. The updated Mineral Reserves estimate reflects a translation of approximately 30 Mt of Measured and Indicated Mineral Resources from Talison's March 31, 2011 estimate to Proven and Probable Mineral Reserves.


 
          Greenbushes Lithium Operations - Lithium Mineral Reserves         
                                                                            
----------------------------------------------------------------------------
                           Update - Sept 30, 2012  Previous - March 31, 2011
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                        Tonnage  Li2O Grade   LCE  Tonnage  Li2O Grade   LCE
Category                   (Mt)         (%)  (Mt)     (Mt)         (%)  (Mt)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
Proven Mineral                                                              
 Reserves                   0.6         3.2  0.04      0.2         3.9  0.02
----------------------------------------------------------------------------
                                                                            
Probable Mineral                                                            
 Reserves                  61.0         2.8   4.2     31.3         3.1   2.4
----------------------------------------------------------------------------
                       
                                                     
Total Proven and                                                            
 Probable Mineral                                                           
 Reserves                  61.5         2.8   4.3     31.4         3.1   2.4
----------------------------------------------------------------------------
Notes:                                                                      
  (1) There may be some rounding errors in totals.                          
  (2) For the updated calculation (as of Sept 30, 2012) a 1.8% Li2O cut-off 
      grade has been applied; for the previous calculation (as of March 31, 
      2011) a 2% Li2O cut-off grade was applied.                            
  (3) Proven Mineral Reserves comprises the Run of Mine and Fine Ore        
      stockpiles. All the Probable Mineral Reserves are contained within the
      Indicated Mineral Resources.                                          
  (4) Mineralization was classified according to the definitions in National
      Instrument 43-101 and the guidelines published by the Council of the  
      Canadian Institute of Mining, Metallurgy and Petroleum (the CIM       
      Standards).                                                           

The table below shows Talison's updated lithium Mineral Resources estimate as of September 30, 2012 and previous estimate as of March 31, 2011.


 
         Greenbushes Lithium Operations - Lithium Mineral Resources         
                                                                            
----------------------------------------------------------------------------
                           Update - Sept 30, 2012  Previous - March 31, 2011
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                        Tonnage  Li2O Grade   LCE  Tonnage  Li2O Grade   LCE
Category                   (Mt)         (%)  (Mt)     (Mt)         (%)  (Mt)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
Measured Mineral                                                            
 Resources                  0.6         3.2  0.04      0.2         3.9  0.02
----------------------------------------------------------------------------
                                                                            
Indicated Mineral                                                           
 Resources                117.9         2.4   7.1     70.2         2.6   4.5
----------------------------------------------------------------------------
                                                                            
Total Measured and                                                          
 Indicated Mineral                                                          
 Resources                118.4         2.4   7.1     70.4         2.6   4.6
----------------------------------------------------------------------------
                                                                            
Total Inferred Mineral                                                      
 Resources                  2.1         2.0   0.1      2.0         2.2   0.1
----------------------------------------------------------------------------
Notes:                                                                      
  (1) There may be some rounding errors in totals.                          
  (2) For the updated estimate (as of September 30, 2012) the lithium       
      Mineral Resources are within lithium domains drawn at a 0.7% Li2O     
      grade boundary constrained by an optimized pit shell, and above 950RL;
      and Measured Mineral Resources comprises the Run of Mine and Fine Ore 
      stockpiles. For the previous estimate (as of March 31, 2011) the      
      lithium Mineral Resources are within lithium domains drawn at a 1.0%  
      Li2O grade boundary and above 1000RL.                                 
  (3) Mineral Resource estimation was performed using Ordinary Kriging into 
      20mNx20mEx5mRL parent blocks, with each variable Li2O, calcium oxide  
      (CaO), ferric oxide (Fe2O3), potassium oxide (K2O), manganese oxide   
      (MnO), sodium oxide (Na2O), phosphorus oxide (P2O5),arsenic oxide     
      (As2O3), tin (Sn), and tantalum oxide (Ta2O5) being estimated         
      independently. This work was overseen by Andrew Purvis, a full-time   
      employee of Talison, who is "Qualified Person" in accordance with     
      National Instrument 43-101 and a "Competent Person" as defined by the 
      Australasian Code for Reporting of Exploration Results, Mineral       
      Resources and Ore Reserves 2004 Edition (the JORC Code).              
  (4) Mineral Reserves are included in Mineral Resources. Mineral Resources 
      are not Mineral Reserves and, as such, do not have demonstrated       
      economic viability.                                                   
  (5) Mineralization was classified according to the definitions in National
      Instrument 43-101 and the guidelines published by the Council of the  
      Canadian Institute of Mining, Metallurgy and Petroleum (the CIM       
      Standards). Categorisation of Mineral Resources under NI 43-101 is    
      consistent with the JORC Code.                                        

Talison does not consider that the estimate of lithium Mineral Resources and Mineral Reserves will be materially affected by any known environmental, permitting, title, mining, infrastructure or metallurgical issues. For further information refer to the technical report in respect of the Greenbushes Lithium Operations titled "Greenbushes Lithium Operations, Located in Western Australia - Australia" dated June 15, 2011, a copy of which can be found on Talison's SEDAR profile at www.sedar.com.

Rockwood recommended offer by Scheme of Arrangement(2)

(2) Certain capitalised terms and abbreviations used in this news release have the defined meanings as set out in the Scheme Booklet available on Talison's website, www.talisonlithium.com and on SEDAR at www.sedar.com.

On August 23, 2012, Talison announced that it had entered into a Scheme Implementation Agreement ("SIA") with Rockwood under which it was proposed that Rockwood, or a wholly-owned entity of Rockwood, would acquire 100% of the ordinary shares in the capital of Talison ("Shares") for cash consideration of C$6.50 per share by way of a Scheme of Arrangement ("Share Scheme"). The Scheme Booklet explaining the terms of the Schemes and including a report from the Independent Expert was filed on SEDAR on October 26, 2012 and dispatched to Talison Securityholders on November 6, 2012.

The strategic and long life nature of the Greenbushes Lithium Operations was a point that was emphasised by Talison and its advisers to Rockwood during value discussions leading up to signing of the SIA. At that time, based on the preliminary assessment of results from surface drilling, updated financial assumptions, the 2012 processing plant capacity expansion and its experience with previous re-estimations and updates of lithium Mineral R esources and Mineral Reserves (including those in 2009 and 2011), Talison expected an increase in lithium Mineral Resources and lithium Mineral Reserves at the Greenbushes Lithium Operations of the magnitude reflected above.

This expected increase in lithium Mineral Resources and lithium Mineral Reserves was taken into account by the Talison Board when making its unanimous recommendation that Talison Securityholders vote in favour of the Schemes, in the absence of a Superior Proposal.

The updated lithium Mineral Resources and Mineral Reserves at the Greenbushes Lithium Operations announced today is in-line with Talison's expectations, and the Talison Board reconfirms its unanimous recommendation that Talison Securityholders vote in favour of the Schemes, in the absence of a Superior Proposal.

The Independent Expert, Ernst & Young Transaction Advisory Services Limited, who was appointed to opine on whether the Schemes are in the best interests of Talison Securityholders, was aware of the potential for a material increase in lithium Mineral Resources and Mineral Reserves at the Greenbushes Lithium Operations when preparing its report for inclusion in the Scheme Booklet.

The Independent Expert has confirmed that the updated lithium Mineral Resources and Mineral Reserves estimate announced today is not inconsistent with the valuation analysis undertaken as part of the assessment and therefore does not affect its conclusion that the Rockwood Transaction is fair and reasonable, and in the best interests of Talison Shareholders and Talison Optionholders, in the absence of a Superior Proposal.

The Independent Expert, in forming its opinion, relied on the independent report prepared by Behre Dolbear Australia Pty Limited ("BDA"), which was appointed as a technical specialist to review the assumptions applied in valuing the Greenbushes Lithium Operations. In undertaking its review, BDA was aware of the potential for an increase in lithium Mineral Resources and Mineral Reserves at the Greenbushes Lithium Operations and in its report considered that the inclusion of an additional 31 million tonnes of the then current lithium Mineral Resources in Talison's preliminary life of mine plan was justified.

BDA has confirmed that the conclusions in its report are not affected by the increase in lithium Mineral Resources and Mineral Reserves announced today as they were taken into account in arriving at their conclusion.

Macquarie Capital Markets Canada Ltd. was aware of the expected increase in lithium Mineral Resources and lithium Mineral Reserves and therefore, had the updated lithium Mineral Resources and lithium Mineral Reserves been released as at the date of the fairness opinion, it would not have changed the opinion provided by Macquarie Capital as at that date, which stated that subject to the various assumptions, explanations and limitations in that opinion, as well as other matters Macquarie Capital considered relevant, the cash consideration to be received by Talison Shareholders was fair from a financial point of view.

The updated lithium Mineral Resource estimates were prepared by Mr. Scott Jackson (BSc (Hons), CFSG, FAusIMM, MAIG), Director and Principal Consultant, of Quantitative Group Pty Ltd ("Quantitative Group") of Perth, Western Australia, in accordance with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves 2004 Edition (the JORC Code), which is comparable with the requirements of National Instrument 43-101 - Standards of Disclosure for Mineral Projects of the Canadian Securities Administrators. Quantitative Group undertook statistical analysis, grade domaining, block estimation, validation and classification of the Mineral Resource, and reviewed the QA/QC data. The geological models and block model were constructed on site by Talison staff. The Quantitative Group work was undertaken or supervised by Mr. Jackson, who also reviewed data collection and data quality. Mr. Jackson is independent of Talison and a "Qualified Person" in accordance with National Instrument 43-101.

The updated lithium Mineral Reserves were prepared by Messrs. Andrew Purvis (BSc (Hons), MSc, FAusIMM), General Manager Geology, Talison, and Stephen Green (B. Eng, FAusIMM), Manager, Mining and Environment at the Greenbushes Lithium Operations each of whom is a full-time employee of Talison and a "Qualified Person" in accordance with National Instrument 43-101. The updated lithium Mineral Reserve calculations were reviewed by Mr. Peter Ingham (MSc, BSc, FAusIMM, MIMMM, Cen), General Manager Mining, BDA. Mr. Ingham is independent of Talison and a "Qualified Person" in accordance with National Instrument 43-101.

Scientific and technical information in this press release was reviewed by or prepared under the supervision of Andrew Purvis, General Manager Geology, Talison.

STATUS OF ROCKWOOD TRANSACTION

The Federal Court of Australia has ordered the convening of meetings of Talison Securityholders to consider the Rockwood Transaction ("Scheme Meetings").

The Scheme Meetings are to be held on November 29, 2012 at the Duxton Hotel, 1 St Georges Terrace, Perth, Western Australia, Australia from 10.00 am.

If the Schemes are approved by Talison Securityholders and by the Federal Court of Australia, they are expected to take effect on December 4, 2012; the last day of trading of Talison shares on the TSX is expected to be December 5, 2012; and payment of Scheme Consideration is expected to be made on December 14, 2012.

Further details are included in the Scheme Booklet which is available on SEDAR at www.sedar.com and on Talison's website at www.talisonlithium.com

Voting on the Share Scheme

In connection with the Share Scheme, there are two important dates for determining voting entitlement which are different for beneficial and registered shareholders.


 
--  Beneficial Shareholders - the record date for determining eligibility of
    beneficial holders to vote on the Share Scheme is October 29, 2012. If
    you are a beneficial shareholder and held your Talison shares on October
    29, 2012, you should contact your intermediary or broker for
    instructions on how to provide your voting instructions. The cut-off
    date for providing your voting instructions is November 26, 2012.
    Further details are provided at Section 4.4(b) of the Scheme Booklet. 
 
--  Registered Shareholders - In accordance with Australian corporate law
    the record date for determining eligibility of registered shareholders
    to vote at the Scheme Meeting is November 27, 2012. If you are a
    registered shareholder on November 27, 2012, please see the Scheme
    Booklet for further instructions on how to vote your Talison Shares. The
    cut-off time for registered holders to submit their proxy is 11:00 am
    (Perth time) on November 27, 2012. 

TIANQI ANNOUNCEMENT

Talison has noted the announcement by Chengdu Tianqi Industry Group Co., Ltd ("Tianqi") regarding the acquisition by its wholly-owned subsidiary of an interest in Talison and intention to submit a proposal to Talison.

Talison confirms that it has not received any proposal from Tianqi.

In the absence of a Superior Proposal, the Talison Board unanimously recommends that Talison Securityholders vote in favour of the Rockwood Transaction.

OTHER INFORMATION

A First Quarter conference call will not be held.

The unaudited condensed consolidated interim financial statements of Talison as at September 30, 2012 and for the three months ended September 30, 2012 are accessible at Talison's website, www.talisonlithium.com and on SEDAR at www.sedar.com.

ABOUT TALISON

Talison is a leading global producer of lithium and has been supplying a global customer network from the Greenbushes Lithium Operations in Western Australia for over 25 years. In anticipation of sustained growth in lithium consumption, driven primarily by the secondary lithium battery market, Talison has doubled its production capac ity at the Greenbushes Operations.


 
FINANCIAL STATEMENTS                                                        
                                                                            
                                    Three months ended   Three months ended 
                                         Sept 30, 2012        Sept 30, 2011 
INCOME STATEMENT                           (Unaudited)          (Unaudited) 
                                                A$'000               A$'000 
--------------------------------------------------------------------------- 
                                                                            
Sales revenue                                   28,478               25,879 
Operating costs                                (16,610)             (16,594)
Other income / (expenses)                       (3,441)              (3,159)
Acquisition Advisory Costs                      (1,173)                   - 
                                  ----------------------------------------- 
EBITDA(1)                                        7,254                6,126 
                                                                            
Depreciation and amortisation                   (1,608)                (688)
                                                                            
Net finance income/(expense)                       700               (3,083)
                                                                            
Income tax expense                              (1,681)                (748)
                                                                            
                                  ----------------------------------------- 
Net Profit for the period                        4,665                1,607 
                                                                            
Earnings per share(2)                                                       
Basic earnings per share (cents)                   4.3                  1.5 
Diluted earnings per share (cents)                 4.2                  1.5 
                                                                            
(1)  EBITDA - results before depreciation and amortisation, net finance     
     income/(expense) and income tax expense. EBITDA is a non IFRS financial
     measure. For a reconciliation of EBITDA to its IFRS compliant income   
     statement, see "Non-IFRS Performance Measures" in Management's         
     Discussion and Analysis of the financial condition and results of      
     operations of Talison Lithium Limited as at September 30, 2012 and for 
     the three ended September 30, 2012 (which can be found on Talison's    
     SEDAR profile at www.sedar.com).                                       
                                                                            
(2)  Basic and diluted earnings per share have been calculated based on the 
     weighted average number of shares on issue. For the three ended        
     September 30, 2012, the weighted average number of shares includes the 
     outstanding ordinary shares of Talison adjusted to remove ordinary     
     shares held by the Talison Long Term Incentive Plan Trust which is     
     consolidated under IFRS. See "Outstanding Share Data" in Management's  
     Discussion and Analysis of the financial condition and results of      
     operations of Talison Lithium Limited as at September 30, 2012 and for 
     the three ended September 30, 2012 (which can be found on Talison's    
     SEDAR profile at www.sedar.com).                                       
                                                                            
                                   As at Sept 30, 2012   As at June 30, 2012
STATEMENT OF FINANCIAL POSITION            (Unaudited)             (Audited)
                                                A$'000                A$'000
----------------------------------------------------------------------------
                                                                            
ASSETS                                                                      
Cash and cash equivalents                       81,008                74,178
Trade and other receivables                     15,936                18,355
Inventories                                     22,628                16,040
Derivative financial instruments                 3,175                 2,984
Property, plant and equipment                  168,809               166,369
Exploration and evaluation                                                  
 assets                                         15,284                14,500
                                --------------------------------------------
Total assets                                   306,840               292,426
                                --------------------------------------------
                                                                            
LIABILITIES                                                                 
Trade and other payables                        15,818                14,270
Interest-bearing liabilities                    26,919                27,548
Tax payable                                      6,314                 5,348
Provisions                                      19,426                20,775
Deferred tax liabilities                        11,048                10,038
                                --------------------------------------------
Total liabilities                               79,525                77,979
                                --------------------------------------------
                                                                            
                                --------------------------------------------
Shareholders' equity                           227,315               214,447
                                --------------------------------------------
                                                                            
                                   As at Sept 30, 2012  As at June 30, 2012 
                                           (Unaudited)            (Audited) 
                                                A$'000               A$'000 
--------------------------------------------------------------------------- 
Outstanding number of shares                                                
Ordinary shares of Talison                 114,290,086          112,341,336 
Shares held in trust(1)                     (3,776,108)          (4,299,367)
Total outstanding number of shares         110,513,978          108,041,969 
                                                                            
Notes:                                                                      
                                                                            
(1)  As at September 30, 2012 the Group holds 3,776,108 (2012: 4,299,367) of
     its own shares in the Talison Long Term Incentive Plan Trust (the      
     "Trust"). Although the Company does not hold any ownership interest in 
     the Trust, Talison Services Pty Ltd, a wholly owned subsidiary of the  
     Company, acts as trustee of the Trust and is able to govern the        
     financial and operating policies of the Trust in accordance with the   
     trust deed.                                                            

Cautionary Note Regarding Forward-Looking Statements

Certain information contained in this press release, including any information as to Talison's mineral reserve and mineral resource estimates, strategy, projects, plans, prospects, future outlook, anticipated events or results or future financial or operating performance, may constitute "forward-looking information" within the meaning of Canadian securities laws. All statements, other than statements of historical fact, constitute forward-looking information. Forward-looking information can often, but not always, be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", "predicts", "potential", "continue" or "believes", or variations (including negative variations) of such words, or statements that certain actions, events or results "may", "could", "would", "should", "might", "potential to", or "will" be taken, occur or be achieved or other similar expressions concerning matters that are not historical facts. The purpose of forward-looking information is to provide the reader with information about management's expectations and plans. Readers are cautioned that forward-looking statements are not guarantees of future performance. All forward-looking statements made or incorporated in this press release are qualified by these cautionary statements.

Forward-looking statements are necessarily based on a number of factors, estimates and assumptions that, while considered reasonable by Talison, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Such factors, estimates and assumptions include, but are not limited to: anticipated financial and operating performance of Talison, its subsidiaries and their respective projects; Talison's market position; future prices of lithium or lithium concentrates; estimation of mineral reserves and mineral resources; realization of mineral reserve and mineral resource estimates; timing, amount and costs of estimated future production; grade, quality and content of concentrate produced; sale of production; capital, operating and exploration expenditures; costs and timing of the expansion of the Greenbushes Lithium Operations; exploration and development of the Salares 7 lithium project; costs and timing of future exploration; requirements for additional capital; government regulation of exploration, development and mining operations; environmental risks; reclamation and rehabilitation expenses; title disputes or claims; absence of significant risks relating to Talison's mining operations; the costs of Talison's hedging policy; sales risks related to China; currency; interest rates, and limitations of insurance coverage. While Talison considers these factors, estimates and assumptions to be reasonable based on information currently available to it, they may prove to be incorrect and actual results may vary.

Readers are cautioned that forward-looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Talison and/or its subsidiaries to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such risk factors include, among others, those described in the Financial Statements and under the heading "Risk Factors" in the annual information form of Talison for the year ended June 30, 2012 dated September 26, 2012, each of which can be found on Talison's SEDAR profile at www.sedar.com. While Talison considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect and actual results may vary.

Although Talison has attempted to identify statements containing important factors that could cause actual actions, event or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. Forward-looking information contained herein is made as of the date of this press release based on the opinions and estimates of management on the date statements containing such forward-looking information are made. Except as required by law, Talison disclaims any obligation to update any forward-looking information, whether as a result of new information, estimates or opinions, future events or results or otherwise. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. Contacts: Talison Lithium Limited Frank Wheatley Executive Director +1 (604) 985 0528 frank.wheatley@talisonlithium.com www.talisonlithium.com

Macquarie Capital Michael Ashforth Executive Director +61 (8) 9224 0644

Macquarie Capital David Cobbold Managing Director +1 (416) 848 3654

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