MELBOURNE  - Australia's IGO reported interim underlying profit ahead of analysts' expectation on Thursday, even as the battery metal producer reeled from falling prices of key commodities, and said it did not have plans to further trim production.

Shares of IGO gained nearly 3% to A$7.27 by 23:38 GMT, while the benchmark index was trading slightly lower.

Underlying profit came in at A$454.4-million ($297.90-million) for the first half of the financial year ended December 31, compared with A$613.9-million a year earlier. That beat Visible Alpha's consensus estimate of A$440-million.

IGO recorded an impairment charge of A$171.8-million for its Cosmos and Forrestania nickel assets in Western Australia owing to a sharp drop in prices, adding to a nearly A$1-billion write-down in 2023.

The company put its Cosmos nickel project into care and maintenance in January when it also trimmed its annual lithium production forecast by 100,000 metric tons to between 1.3-million metric tons and 1.4-million metric tons as a way to manage stockpiles following a reduction in sales to electric vehicle battery makers.

IGO warned costs would rise by A$50 per ton to A$330/t to A$380/t for its Greenbushes lithium mine in Western Australia, in line with analyst estimates.

"We expect a neutral reaction to the result; higher costs at Greenbushes were expected by the market," Citi analysts said.

IGO is intent on cutting costs at Greenbushes, which it co-owns with China's Tianqi and Albemarle, CEO Ivan Vella said, as part of a strategy refresh that has been underway since Vella started in the top job in December.

"It's a world class ore body. Is it a world class mining operation? It seems at Talison ... there is more to do."

Vella added there were currently no plans to defer growth at the mine despite falling prices, with a third ore processing plant on track to start commissioning next year.

Timing of a fourth ore processing plant at Greenbushes, expected to start commissioning in 2027, may be adjusted, he said.

IGO continues to face problems at the Kwinana lithium hydroxide refinery it owns with Tianqi and a focus on improving its outcome is part of IGO's strategic review.

Production of lithium hydroxide at Kwinana stood at 1 224 t for the half year, compared with 779 t/y earlier. That was well behind its nameplate capacity of 24 000 t.

The company declared an interim dividend of 11 Australian cents per share, down from 14 Australian cents paid last year.