Shares in Galaxy Resources rose after the company said it had begun cutting costs, including a 50 per cent reduction in headcount at its Perth corporate office.
Galaxy said the personnel retrenchments would save it $1.1 million a year and was part of an ongoing focus to deliver a robust financial structure.
"Full redundancy entitlements have been met for departing staff," the company said.
Galaxy interim managing director Anthony Tse said maintaining strong financial discipline and ensuring that cost control was a principal strategic objective.
"Sadly this means that we have had to make some head count reductions in the Perth office," he said.
The company also announced its recent $37.5 million raising would allow it to pay down debt, ramp up production and its Jiangsu lithium carbonate plant in China and looks at how it can bring its Sal de Vida brine project in Argentina online.
"Galaxy is now driving production levels and cost reduction initiatives at Jiangsu to achieve break-even cash flow status this year," the company said.
"The company is now in a position to recommence detailed analysis of the best structure technically and financially to pursue the future development of the Sal de Vida brine project."
Galaxy also gave a bullish outlook for the lithium market with demand expected to stay strong.
"The company will now focus on ensuring the right development structures and partners are in place for the Sal de Vida Project, and ensure that analysis of the project both technically and financially is disciplined in order to successfully take the project through to the construction and production phase," the company said.
Galaxy's definitive feasibility study for Sal de Vida, completed in April, indicated that the project had potential annual revenues of about $US215 million and operating cash flow before interest and tax of $US118 million.
A pre-tax net present value at a 10 per cent discount rate was estimated at $US645 million, representing an internal rate of return of 23 per cent, and a post-tax net present value at a 10 per cent discount rate was estimated at $US380 million, representing an internal rate of return of 19 per cent.
Shares in Galaxy were up 0.8 cents, or 14.82 per cent, to 6.2 cents at 10.30am.