Vanadium Electrolyte Facility Development Full

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Largo Reviews Third Quarter 2023 Monetary Outcomes; Declares First Business Cargo of Ilmenite as By-Product of its Vanadium Operations in Brazil (Picture: Enterprise Wire)

Q3 2023 and Different Highlights

• Revenues of $44.0 million vs. revenues of $54.3 million in Q3 2022; Decline pushed by decrease vanadium costs and decrease vanadium gross sales volumes; Revenues per lb offered ³ of V ₂ O ₅ equal of $8.34 vs. $8.80 in Q3 2022
• Working prices of $42.5 million vs. $45.6 million in Q3 2022; Money working prices excluding royalties ¹ per pound offered of $5.44 vs. 4.86 per lb offered in Q3 2022
• Internet lack of $11.9 million vs. web lack of $2.6 million in Q3 2022; Primary loss per share of $0.19 vs. primary loss per share of $0.04 in Q3 2022
• Money used earlier than working capital objects of $4.4 million vs. money supplied earlier than working capital objects of $4.3 million in Q3 2022
• Money steadiness of $39.5 million, web working capital surplus of $91.0 million and debt of $65.0 million exiting Q3 2023
• V ₂ O ₅ equal gross sales of two,385 tonnes (inclusive of 256 tonnes of bought materials) vs. 2,796 tonnes (inclusive of 351 tonnes of bought materials) offered in Q3 2022
• Manufacturing of two,163 tonnes (4.8 million lbs ¹ ) of V ₂ O ₅ vs. 2.906 tonnes in Q3 2022
• Largo Clear Vitality’s (“LCE”) 6 megawatt-hour (“MWh”) vanadium redox stream battery (“VRFB”) deployment for Enel Inexperienced Energy España (“EGPE”) was validated to function on check situations in accordance with EGPE specs and LCE check procedures in October
• The Firm efficiently commissioned and is within the technique of ramping up manufacturing of its new ilmenite focus plant with preliminary manufacturing of 350 tonnes in August and 700 tonnes in September; The primary industrial cargo of ilmenite is in progress and may contribute to the Firm’s revenues in This fall 2023 as a by-product of its vanadium operations
• Q3 2023 outcomes convention name: Thursday, November ninth at 1:00 p.m. ET

Vanadium Market Replace ²

• The common benchmark worth per lb of V ₂ O ₅ in Europe was $8.03, a 2.5% lower from the typical of $8.23 seen in Q3 2022
• Vanadium spot demand was gentle in Q3 2023, primarily attributable to adversarial situations within the Chinese language and European metal industries. Nonetheless, sturdy demand progress from the aerospace and power storage sectors continued

Daniel Tellechea, Director and Interim CEO of Largo commented: “Q3 2023 was a difficult quarter for Largo, primarily because of the tragic accident that occurred on the Firm’s chemical plant in July in addition to technical delays in commissioning our new crushing plant. The accident on the chemical plant resulted in a capability bottleneck within the evaporator part of the plant, which resulted in decrease general manufacturing charges of vanadium in July and August. In early September, our working workforce recommissioned the evaporator circuit, which is now working at its authentic capability. A delay in ramp up of the brand new magnetic separation crushing plant additionally briefly impacted vanadium manufacturing in Q3 2023. The brand new crushing plant was designed to offset the influence of decrease mined vanadium grades, as per the Firm’s mine plan. The working workforce is within the technique of resolving these points, and we’re happy to report that the crushing plant exceeded 1,000 tonnes of contained V ₂ O ₅ in October, regardless of further crushing plant enhancements scheduled to be applied in November and December.”

He continued: “It’s our precedence to proceed to optimize our operations, cut back prices, and obtain manufacturing and gross sales targets safely. In mild of this, we keep our steering for 2023. Moreover, additional measures are being applied to enhance the group’s efficiency, together with optimizing operational efficiencies by way of the implementation of the brand new crushing system, concentrating on growing manufacturing of excessive purity vanadium, restructuring gear upkeep processes to additional cut back prices, and ramping up ilmenite manufacturing beginning within the fourth quarter of 2023 to diversify revenues. We’re starting to see a notable discount in key consumable prices, similar to sodium carbonate, in addition to ongoing overhead price reductions by way of a discount of the variety of contractors on the mine by way of effectivity enchancment packages and additional reductions within the headcount at LCE. The Firm considers these ongoing initiatives to be a vitally necessary measures to counter the present lower in vanadium costs.”

He concluded: “Throughout this previous yr, we have now additionally made a number of important investments which might be mandatory for the sustainability of our operations in a decrease vanadium worth surroundings. Amongst these investments are an elevated waste rock pre-stripping and aggressive infill drilling program to optimize manufacturing within the years to come back. Our workforce has efficiently constructed and commissioned an ilmenite plant to diversify future revenues as a by-product of the vanadium mine, constructed a brand new magnetic separation crushing plant for the aim of mining lower-grade materials with out decreasing manufacturing ranges, and delivered the Firm’s first vanadium battery to EGPE, our European power storage buyer. A considerable funding has been made in LCE, which isn’t but producing important revenues, however continues to devour money. With our present strategic evaluation course of in place, Largo expects to optimize the worth proposition of LCE and take part in one of the vital important macrotrends, the clear power transition with vanadium as a vital materials. With these investments, we consider that Largo is on the trail to a brighter future.”

Monetary and Working Outcomes – Highlights

Q3 2023 Notes

• The lower in working prices in Q3 2023 is basically attributable to decrease general gross sales within the interval, which features a discount within the sale of bought merchandise and decrease royalties attributable to decrease gross sales.
• V ₂ O ₅ equal manufacturing of two,163 tonnes in Q3 2023 decreased from 2,639 tonnes produced in Q2 2023. Manufacturing in July 2023 was 644 tonnes, with 775 tonnes produced in August and 744 tonnes produced in September, for a complete of two,163 tonnes of V ₂ O ₅ equal produced. July and August manufacturing had been negatively impacted because of the chemical plant working at restricted capability because of the accident within the evaporation part of the plant in July 2023. As well as, September manufacturing was negatively impacted by low availability of the crushing circuit, mixed with the deliberate decrease vanadium grade of ore mined. V ₂ O ₅ manufacturing in October continued to enhance with 866 tonnes produced.
• The Firm is actively working to attain greater ranges of operational stability to higher handle its prices which have elevated due partially to decrease grades of ore mined as in contrast with prior quarters. The decrease grade of ore mined in Q3 2023 was in accordance with plan, representing a 27% lower year-over-year. The Firm is actively working in the direction of growing the provision of its new crushing system to offset lowers grades of ore mined and attain manufacturing of 1,000 tonnes of V ₂ O ₅ per 30 days in future months.
• Whole mined (dry foundation) of 6.4 million tonnes elevated by 53% and whole ore mined of 447,165 tonnes was 27% greater than Q3 2022, respectively. Elevated mining charges and better mining prices impacted the Firm’s monetary efficiency in Q3 2023.
• As a part of its ongoing mitigation efforts, the Firm is targeted on decreasing its mounted price construction by way of contract renegotiations and an optimization of key operational areas, together with mining, upkeep, gear rental and consumables.
• The commissioning and ramp up of the ilmenite plant commenced in Q3 2023 with manufacturing of 350 tonnes in August and 700 tonnes in September. The Firm expects the ramp as much as conclude in Q2 2024 with income expectations in This fall 2023.
• Exploration and analysis prices of $2.3 million elevated by $1.8 million from Q3 2022. This was pushed by infill drilling and geological mannequin work on the Maracás Menchen Mine and diamond drilling at Campo Alegre de Lourdes to assist the upkeep of the Firm’s mineral rights. Throughout Q3 2023, the Firm accomplished roughly 9,100 metres of diamond drilling within the close to mine deep drilling and exploration program. Within the 9 months ended September 30, 2023, roughly 19,100 metres of diamond drillholes have been accomplished in Campo Alegre de Lourdes and Maracas targets. A re-assay program started in Q2 2023 to carry out chemical evaluation on beforehand interpreted outcomes. The main focus of this program is to extend measured and indicated sources. Roughly 5,000 samples had been ready and despatched to the exterior laboratory for evaluation in Q3 2023.

The data supplied inside this launch needs to be learn together with Largo’s unaudited condensed interim consolidated monetary statements for the three and 9 months ended September 30, 2023 and 2022 and its administration’s dialogue and evaluation (“MD&A”) for the three and 9 months ended September 30, 2023 which can be found on our web site at www.largoinc.com or on the Firm’s respective profiles at www.sedarplus.com and www.sec.gov .

About Largo

Largo is a globally acknowledged vanadium firm identified for its high-quality VPURE™ and VPURE+™ merchandise, sourced from its Maracás Menchen Mine in Brazil. The Firm is presently centered on implementing an ilmenite focus plant and is endeavor a strategic analysis of its U.S.-based clear power enterprise, together with its superior VCHARGE vanadium battery know-how to maximise the worth of the group. Largo’s strategic marketing strategy facilities on sustaining its place as a number one vanadium provider with a progress technique to assist a low-carbon future.

Largo’s widespread shares commerce on the Nasdaq Inventory Market and on the Toronto Inventory Trade below the image “LGO”. For extra info on the Firm, please go to www.largoinc.com .

Cautionary Assertion Concerning Ahead-looking Data:

This press launch incorporates “forward-looking info” and “forward-looking statements” throughout the which means of relevant Canadian and United States securities laws. Ahead-looking info on this press launch consists of, however is just not restricted to, statements with respect to the timing and quantity of estimated future manufacturing and gross sales; the long run worth of commodities; prices of future actions and operations, together with, with out limitation, attaining operational stability and managing unit prices; and the anticipated completion of the ilmenite plan ramp up in This fall 2023.

The next are a number of the assumptions upon which forward-looking info is predicated: that normal enterprise and financial situations won’t change in a fabric adversarial method; demand for, and secure or enhancing worth of V ₂ O ₅ , different vanadium merchandise, ilmenite and titanium dioxide pigment; receipt of regulatory and governmental approvals, permits and renewals in a well timed method; that the Firm won’t expertise any materials accident, labour dispute or failure of plant or gear or different materials disruption within the Firm’s operations on the Maracás Menchen Mine or referring to Largo Clear Vitality; the provision of financing for operations and improvement; the provision of funding for future capital expenditures; the flexibility to interchange present funding on phrases passable to the Firm; the flexibility to mitigate the influence of heavy rainfall; the reliability of manufacturing, together with, with out limitation, entry to huge ore, the Firm’s capacity to obtain gear, providers and working provides in adequate portions and on a well timed foundation; that the estimates of the sources and reserves on the Maracás Menchen Mine are inside cheap bounds of accuracy (together with with respect to measurement, grade and restoration and the operational and worth assumptions on which such estimates are primarily based); the accuracy of the Firm’s mine plan on the Maracás Menchen Mine, the competitiveness of the Firm’s vanadium redox stream battery (” VRFB “) know-how; the flexibility to acquire funding by way of authorities grants and awards for the Inexperienced Vitality sector, the accuracy of price estimates and assumptions on future variations of VCHARGE battery system design, that the Firm’s present plans for ilmenite and VRFBs will be achieved; the Firm’s “two-pillar” enterprise technique can be profitable; the Firm’s gross sales and buying and selling preparations won’t be affected by the evolving sanctions towards Russia; and the Firm’s capacity to draw and retain expert personnel and administrators; the flexibility of administration to execute strategic targets.

Ahead-looking statements will be recognized by means of forward-looking terminology similar to “plans”, “expects” or “doesn’t count on”, “is predicted”, “price range”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “doesn’t anticipate”, or “believes”, or variations of such phrases and phrases or statements that sure actions, occasions or outcomes “could”, “may”, “would”, “may” or “can be taken”, “happen” or “be achieved”. All info contained on this information launch, aside from statements of present and historic truth, is ahead wanting info. Ahead-looking statements are topic to identified and unknown dangers, uncertainties and different components that will trigger the precise outcomes, stage of exercise, efficiency or achievements of Largo to be materially completely different from these expressed or implied by such forward-looking statements, together with however not restricted to these dangers described within the annual info type of Largo and in its public paperwork filed on www.sedarplus.ca and out there on www.sec.gov occasionally. Ahead-looking statements are primarily based on the opinions and estimates of administration as of the date such statements are made. Though administration of Largo has tried to establish necessary components that might trigger precise outcomes to vary materially from these contained in forward-looking statements, there could also be different components that trigger outcomes to not be as anticipated, estimated or supposed. There will be no assurance that such statements will show to be correct, as precise outcomes and future occasions may differ materially from these anticipated in such statements. Accordingly, readers mustn’t place undue reliance on forward-looking statements. Largo doesn’t undertake to replace any forward-looking statements, besides in accordance with relevant securities legal guidelines. Readers must also evaluation the dangers and uncertainties sections of Largo’s annual and interim MD&A which additionally apply.

Emblems are owned by Largo Inc.

Non-GAAP ⁵ Measures

The Firm makes use of sure non-GAAP measures on this press launch, that are described within the following part. Non-GAAP monetary measures and non-GAAP ratios should not standardized monetary measures below IFRS, the Firm’s GAAP, and may not be similar to related monetary measures disclosed by different issuers. These measures are supposed to supply further info and shouldn’t be thought of in isolation or as an alternative choice to measures of efficiency ready in accordance with IFRS.

Revenues Per Pound

This press launch refers to revenues per pound offered, a non-GAAP efficiency measure that’s used to supply traders with details about a key measure utilized by administration to observe efficiency of the Firm.

This measure, together with money working prices and whole money prices, is taken into account to be one of many key indicators of the Firm’s capacity to generate working earnings and money stream from its Maracás Menchen Mine and gross sales actions. This revenues per pound measure doesn’t have any standardized which means prescribed by IFRS and differs from measures decided in accordance with IFRS. This measure is meant to supply further info and shouldn’t be thought of in isolation or as an alternative choice to measures of efficiency ready in accordance with IFRS. This measure is just not essentially indicative of web earnings or money stream from working actions as decided below IFRS.

The next desk gives a reconciliation of this measure per pound offered to revenues as per the Q3 2022 unaudited condensed interim consolidated monetary statements.

Money Working Prices Per Pound

The Firm’s MD&A refers to money working prices per pound and money working prices excluding royalties per pound, that are non-GAAP ratios primarily based on money working prices and money working prices excluding royalties, that are non-GAAP monetary measures, in an effort to present traders with details about a key measure utilized by administration to observe efficiency. This info is used to evaluate how effectively the Maracás Menchen Mine is performing in comparison with plan and prior intervals, and in addition to evaluate its general effectiveness and effectivity.

Money working prices consists of mine web site working prices similar to mining prices, plant and upkeep prices, sustainability prices, mine and plant administration prices, royalties and gross sales, normal and administrative prices (all for the Mine properties section), however excludes depreciation and amortization, share-based funds, overseas change positive factors or losses, commissions, reclamation, capital expenditures and exploration and analysis prices. Working prices not attributable to the Mine properties section are additionally excluded, together with conversion prices, product acquisition prices, distribution prices and stock write-downs.

Money working prices excluding royalties is calculated as money working prices much less royalties. Money working prices per pound and money working prices excluding royalties per pound are obtained by dividing money working prices and money working prices excluding royalties, respectively, by the kilos of vanadium equal offered that had been produced by the Maracás Menchen Mine. Money working prices, money working prices excluding royalties, money working prices per pound and money working prices excluding royalties per pound, together with revenues, are thought of to be key indicators of the Firm’s capacity to generate working earnings and money stream from its Maracás Menchen Mine. These measures differ from measures decided in accordance with IFRS, and should not essentially indicative of web earnings or money stream from working actions as decided below IFRS.

The next desk gives a reconciliation of money working prices and money working prices excluding royalties, money working prices per pound and money working prices excluding royalties per pound for the Maracás Menchen Mine to working prices as per the Q3 2023 unaudited condensed interim consolidated monetary statements.

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¹ Conversion of tonnes to kilos, 1 tonne = 2,204.62 kilos or lbs.
² Fastmarkets Metallic Bulletin.
³ The money working prices excluding royalties and revenues per pound per pound offered are reported on a non-GAAP foundation. Check with the “Non-GAAP Measures” part of this press launch. Revenues per pound offered are calculated primarily based on the amount of V2O5 offered throughout the said interval.
⁴ Efficient grade represents the proportion of magnetic materials mined multiplied by the proportion of V2O5 within the magnetic focus
⁵ GAAP – Typically Accepted Accounting Ideas

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Investor Relations
Alex Guthrie
Senior Supervisor, Exterior Relations
+1.416.861.9778
aguthrie@largoinc.com