Largo Reports Q1 2025 Financial Results with Continued Focus on Production Stability and Cost Reduction Efforts
Largo Reports Q1 2025 Financial Results with Continued
Focus on Production Stability and Cost Reduction Efforts
All dollar amounts expressed are in thousands of U.S. dollars unless otherwise indicated.
Q1 2025 and Other Highlights
e¢ Revenues of $28.2 million in Q1 2025 vs. 42.2 million in Q1 2024; Revenues per pound sold! of $6.04 in Q1 2025
vs. $6.91 in Q1 2024; Lower revenues are a result of continued downward pressure in vanadium prices and
lower sales volumes
e¢ Operating costs of $42.5 million in Q1 2025, 15% below Q1 2024
e Adjusted cash operating costs excluding royalties per pound! of $3.88 in Q1 2025, 27% below Q1 2024, despite
mining lower ore grades and decreased production rates
¢ Net loss of $9.2 million in Q1 2025, which included $7.0 million in non-recurring items vs. a net loss of $13.0
million in Q1 2024, which included $4.4 million in non-recurring items
e Basic loss per share of $0.14 in Q1 2025 vs. basic loss per share of $0.20 in Q1 2024
e V,0<5 equivalent sales of 2,046 tonnes (inclusive of 158 tonnes of purchased material) in Q1 2025 vs. 2,765
equivalent tonnes sold (inclusive of 156 tonnes of purchased material) in Q1 2024
e V,Os production of 1,297 tonnes (2.8 million Ibs”) in Q1 2025 vs. 1,729 tonnes produced in Q1 2024; Lower
production in Q1 2025 was primarily due to impacts from mining lower-grade ore zones required as part the
Company’s open pit mine sequencing, reduced equipment availability on an expanded mine contractor fleet, and
operational adjustments related to the kiln refractory replacement completed in Q4 2024, which required
additional adjustments in early 2025
e The Company produced 6,162 tonnes of ilmenite concentrate in Q1 2025 vs. 9,563 tonnes in Q1 2024, and sold
8,647 tonnes vs. 513 tonnes in Q1 2024
e The Company maintains its revised 2025 production, sales and cost guidance and expects a return to more
normalized production levels over the remainder of the year as throughput increases and operational
turnaround initiatives progress
Vanadium Market Update
e Vanadium markets in Europe and China remain weak, pressured by low steel and infrastructure demand and
oversupply from Chinese and Russian producers, though aerospace demand is expected to pick up in the second
half of 2025
e U.S. ferrovanadium (“FeV”) prices are holding at levels approximately 9% higher than at the start of 2025,
supported by increased buying interest amid geopolitical tensions and policy shifts that have tightened supply
dynamics
e The average benchmark price per pound of V,O<z in Europe was $5.26 in Q1 2025, a 18% decrease from the
average of $6.44 seen in Q1 2024; The average benchmark price per kg of FeV in Europe was $24.26 in Q1 2025,
a 13% decrease from the average of $27.96 seen in Q1 2024
e As of May 8, 2025, the average benchmark FeV price per pound of V was $15.25 in the U.S. (or approximately
$33.62 per kg FeV), and as of May 9, 2025, the average benchmark price per pound of V2Os was $5.20 in
Europe
TORONTO--(BUSINESS WIRE)--May 14, 2025--Largo Inc. ("Largo" or the "Company") (TSX: LGO) (NASDAQ: LGO)
today released financial results for the three months ended March 31, 2025. The Company reported quarterly vanadium
pentoxide (“V0”) equivalent sales of 2,046 tonnes at an adjusted cash operating cost excluding royalties per pound! sold of
$3.88.
Daniel Tellechea, Interim CEO and Director of Largo, stated: “Our first quarter results reflect the impact of lower production
levels, which constrained sales volumes, combined with continued pricing pressure in the vanadium market, all of which
significantly affected our revenues and added pressure to our cash position. Despite this environment, Largo achieved a 15%
reduction in overall operating costs compared to Q1 2024 as well as a 27% reduction in our adjusted cash operating costs
excluding royalties! , reflecting a continued focus on cost-control initiatives and operational efficiency improvements. We
continue to actively advance our operational turnaround plan, implementing targeted initiatives aimed at further reducing
costs and improving productivity at our Maracas Menchen Mine.”
He continued: “Following the completion of our Storion Energy joint venture transaction, Largo is better positioned to
allocate resources and focus on strengthening core mining operations in Brazil, while maintaining a long-term view on the
potential of long duration energy storage solutions in the U.S. Looking ahead, securing near-term financing solutions
remains a priority as we work to support our liquidity needs and ensure Largo is positioned to navigate ongoing market
uncertainty.”
Financial and Operating Results — Highlights
Three months ended
Financial figures expressed in thousands of U.S. dollars, except as otherwise stated Mar. 31,2025 Mar. 31,2024
Revenues 28,235 42,187
Operating costs (42,477) (49,707)
Net loss (9,205) (13,006)
Basic earnings (loss) per share (0.14) (0.20)
|Adjusted EBITDA! (2,774) (2,425)
Mining operations adjusted EBITDA! (697) 250
Cash used before working capital items (operating activities) (8,492) (3,188)
Cash operating costs excl. royalties! ($/Ib) 6.54 6.12
Adjusted cash operating costs excl. royalties! ($/Ib) 3.88 5.33
(Cash 8,445 45,656
Debt 92,115 75,000
Total mined — dry basis (tonnes) 3,933,242 3,243,492
Total ore mined (tonnes) 446,614 604,231
Effective grade? of ore milled (%) 0.53 0.82
|\V,05 equivalent production (tonnes) 1,297 1,729
1V,O5 equivalent sales (tonnes) 2,046 2,765
Imenite concentrate sales (tonnes) 8,647 513
Key Highlights
e During Q1 2025, the Company recognized revenues of $27.5 million (Q1 2024 — $42.2 million) from the sales of 2,046
tonnes of V,05 equivalent (Q1 2024 — 2,765 tonnes) as well as revenues from ilmenite sales of $0.7 million (Q1 2024 -
$0.07 million).
¢ The Company recorded a net loss of $9.2 million in Q1 2025 compared with a net loss of $13.0 million in Q1 2024.
The improvement was primarily due to the gain on disposal of interest in subsidiary of $5.2 million and a 15% decrease
in operating costs.
¢ The Company’s operating costs decreased by 15% to $42.5 million in Q1 2025 compared to 49.7 million in Q1 2024.
The decrease in operating costs in Q1 2025 was largely driven by a 48% decrease in direct mine and production costs,
reflecting a 25% decrease in vanadium sold in 2024, as well as the impact of the Company's previously announced
initiatives to reduce production costs and improve productivity and the impact of inventory write-downs in the current
and prior periods. The inventory write-down in Q1 2025 includes a write-down of produced vanadium finished
products of $11.2 million and a write-down reversal of warehouse materials of $0.1 million.
¢ Cash operating costs excluding royalties per pound! were $6.54 per lb in Q1 2025, compared with $6.12 for Q1 2024.
The increase seen in Q1 2025 compared with Q1 2024 is largely due lower sales volumes of in Q1 2025 and increased
inventory write-downs. Mining in lower grade ore zones also impacted the financial performance. Additionally, lower
ore mined resulted in stoppages at the kiln and plant which also contributed to increased costs in Q1 2025. The
Company continues to make progress with a number of initiatives as part of its operational turnaround plan with the
goal of reducing production costs and improving productivity (see press release dated March 28, 2025).
e Adjusted cash operating costs excluding royalties per pound!, which excludes the impact of inventory write-downs was
$3.88 per lb sold in Q1 2025, compared with $5.33 for Q1 2024.
e Professional, consulting and management fees, other general and administrative expenses, and technology start-up
costs in Q1 2025 decreased by 18%, 37%, and 82%, respectively, compared to Q1 2024, primarily due to reduced
headcount and activity at LCE.
e On January 31, 2025 (the “Closing Date”), the Company and affiliates of Stryten Energy LLC closed the previously
disclosed transaction to establish Storion Energy LLC ("Storion"). Storion has commenced operations and is working
to qualify their electrolyte product with potential customers. In addition, 13 employees of Largo Clean Energy Corp.
(“LCE”) moved to Storion on the Closing Date, resulting in a reduced headcount at LCE at the end of Q1 2025.
e Subsequent to Q1 2025, production and sales in were 481 tonnes and 608 tonnes of V,O5 equivalent, respectively, in
April 2025, with 1,833 tonnes of ilmenite concentrate being produced during this period and 1,914 dry tonnes of
ilmenite being sold.
The information provided within this release should be read in conjunction with Largo's unaudited condensed interim
consolidated financial statements for the three months ended March 31, 2025 and 2024 and its management's discussion and
analysis for the three months ended March 31, 2025 which are available on our website at www.largoinc.com or on the
Company’s respective profiles at www.sedarplus.com and www.sec.gov.
About Largo
Largo is a globally recognized supplier of high-quality vanadium and ilmenite products, sourced from its world-class
Maracas Menchen Mine in Brazil. As one of the world’s largest primary vanadium producers, Largo produces critical
materials that empower global industries, including steel, aerospace, defense, chemical, and energy storage sectors. The
Company is committed to operational excellence and sustainability, leveraging its vertical integration to ensure reliable
supply and quality for its customers.
Largo is also strategically invested in the long-duration energy storage sector through its 50% ownership of Storion Energy, a
joint venture with Stryten Energy focused on scalable domestic electrolyte production for utility-scale vanadium flow battery
long-duration energy storage solutions in the U.S.
Largo’s common shares trade on the Nasdaq Stock Market and on the Toronto Stock Exchange under the symbol "LGO". For
more information on the Company, please visit www.largoinc.com.
Cautionary Statement Regarding Forward-looking Information:
This press release contains “forward-looking information” and “forward-looking statements” within the meaning of
applicable Canadian and United States securities legislation. Forward-looking information in this press release includes, but
is not limited to, statements with respect to the timing and amount of estimated future production and sales; the future price of
commodities; costs of future activities and operations, including, without limitation, the effect of inflation and exchange
rates; the effect of unforeseen equipment maintenance or repairs on production; the ability to produce high purity V2O5 and
V2O3 according to customer specifications, the extent of capital and operating expenditures, the ability of the Company to
make improvements on its current short-term mine plan; and the impact of global delays and related price increases on the
Company’ global supply chain and future sales of vanadium products.
The following are some of the assumptions upon which forward-looking information is based: that general business and
economic conditions will not change in a material adverse manner, demand for, and stable or improving price of V2O5 and
other vanadium products, ilmenite and titanium dioxide pigment; receipt of regulatory and governmental approvals, permits
and renewals in a timely manner, that the Company will not experience any material accident, labour dispute or failure of
plant or equipment or other material disruption in the Company ’s operations at the Maracas Menchen Mine or relating to
Largo Clean Energy, specially in respect of the installation and commissioning of the EGPE project; the availability of
financing for operations and development; the availability of funding for future capital expenditures, the ability to replace
current funding on terms satisfactory to the Company; the ability to mitigate the impact of heavy rainfall; the reliability of
production, including, without limitation, access to massive ore, the Company's ability to procure equipment, services and
operating supplies in sufficient quantities and on a timely basis; that the estimates of the resources and reserves at the
Maracas Menchen Mine are within reasonable bounds of accuracy (including with respect to size, grade and recovery and
the operational and price assumptions on which such estimates are based); the accuracy of the Company's mine plan at the
Maracas Menchen Mine; that the Company’s current plans for ilmenite can be achieved; the Company 8s ability to protect and
develop its technology, the Company’ ability to maintain its IP; the competitiveness of the Company's product in an evolving
market; the Company’ ability to attract and retain skilled personnel and directors; the ability of management to execute
strategic goals; that the Company will enter into agreements for the sales of vanadium, ilmenite and TiO2 products on
favourable terms and for the sale of substantially all of its annual production capacity; and receipt of regulatory and
governmental approvals, permits and renewals in a timely manner.
Forward-looking statements can be identified by the use of forward-looking terminology such as “plans”, “expects” or
“does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not
anticipate”’, or “believes”, or variations of such words and phrases or statements that certain actions, events or results
a” ce a” 66 a” 66
“may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved”, although not all forward-looking
statements include those words or phrases. In addition, any statements that refer to expectations, intentions, projections,
guidance, potential or other characterizations of future events or circumstances contain forward-looking information.
Forward-looking statements are not historical facts nor assurances of future performance but instead represent
management's expectations, estimates and projections regarding future events or circumstances. Forward-looking statements
are based on our opinions, estimates and assumptions that we considered appropriate and reasonable as of the date such
information is stated, subject to known and unknown risks, uncertainties and other factors that may cause the actual results,
level of activity, performance or achievements of Largo to be materially different from those expressed or implied by such
forward-looking statements, including but not limited to those risks described in the annual information form of Largo and in
its public documents filed on www.sedarplus.ca and available on www.sec.gov from time to time. Forward-looking statements
are based on the opinions and estimates of management as of the date such statements are made. Although management of
Largo has attempted to identify important factors that could cause actual results to differ materially from those contained in
forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended.
There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forwara-
looking statements. Largo does not undertake to update any forward-looking statements, except in accordance with
applicable securities laws. Readers should also review the risks and uncertainties sections of Largo s annual and interim
MDA which also apply.
Trademarks are owned by Largo Inc.
Non-GAAP Measures
The Company uses certain non-GAAP measures in its press release, which are described in the following section. Non-GAAP
financial measures and non-GAAP ratios are not standardized financial measures under IFRS, the Company's GAAP, and
might not be comparable to similar financial measures disclosed by other issuers. These measures are intended to provide
additional information and should not be considered in isolation or as a substitute for measures of performance prepared in
accordance with IFRS. Management believes that non-IFRS financial measures, when supplementing measures determined in
accordance with IFRS, provide investors with an improved ability to evaluate the underlying performance of the Company.
Revenues Per Pound
The Company 5 press release refers to revenues per pound sold, V,O5 revenues per pound of V>O5 sold, V»O3 revenues per
pound of V,03 sold and FeV revenues per kg of FeV sold, which are non-GAAP financial measures that are used to provide
investors with information about a key measure used by management to monitor performance of the Company.
These measures, along with cash operating costs, are considered to be key indicators of the Company’s ability to generate
operating earnings and cash flow from its Maracas Menchen Mine and sales activities. These measures differ from measures
determined in accordance with IFRS, and are not necessarily indicative of net earnings or cash flow from operating activities
as determined under IFRS.
The following table provides a reconciliation of revenues per pound sold, V,O5 revenues per pound of V,05 sold, V703
revenues per pound of V,O03 sold and FeV revenues per kg of FeV sold to revenues and the revenue information presented in
note 23 as per the QI 2025 unaudited condensed interim consolidated financial statements.
Three months ended
March 31, 2025 March 31, 2024
Revenues - V,0s produced! $ 12,133 $ 21,558
V0s sold - produced (000s 1b) 2,119 3,113
V0; revenues per pound of V,0s sold - produced ($/Ib) $ 5.73 $ 6.93
Revenues - V,05 purchased! $ — $ 988
V 0s sold - purchased (000s Ib) — 176
VO revenues per pound of V,0s sold - purchased ($/lb) $ — $ 5.61
Revenues - V,0s} $ 12,133 $ 22,546
V5 sold (000s Ib) 2,119 3,289
V 05 revenues per pound of V,0s sold ($/lb) $ 5.73 $ 6.85
Revenues - V,03 produced! $ 1,296 $ 6,203
V0; sold - produced (000s Ib) 165 668
V03 revenues per pound of V,03 sold - produced ($/Ib) $ 71.85 $ 9.29
Revenues - FeV produced! $ 11,712 $ 12,249
FeV sold - produced (000s kg) 574 569
FeV revenues per kg of FeV sold - produced ($/kg) $ 20.40 $ 21.53
Revenues - FeV purchased! $ 2,356 $ 1,120
FeV sold - purchased (000s kg) 105 51
FeV revenues per kg of FeV sold - purchased ($/kg) $ 22.44 $ 21.96
Revenues — FeV! $ 14,068 $ 13,369
FeV sold (000s kg) 679 620
FeV revenues per kg of FeV sold ($/kg) $ 20.72 $ 21.56
Revenues! $ 27,497 $ 42,118
V 05 equivalent sold (000s Ib) 4,555 6,096
Revenues per pound sold ($/Ib) $ 6.04 $ 6.91
1. Year ended as per note 19 of the Company's Q1 2025 unaudited condensed interim consolidated financial
statements.
Cash Operating Costs Excluding Royalties Per Pound
The Company ’s press release refers to cash operating costs per pound, cash operating costs excluding royalties per pound
and adjusted cash operating costs excluding royalties per pound, which are non-GAAP ratios based on cash operating costs,
cash operating costs excluding royalties and adjusted cash operating costs excluding royalties, which are non-GAAP
financial measures, in order to provide investors with information about a key measure used by management to monitor
performance. This information is used to assess how well the Maracas Menchen Mine is performing compared to its plan and
prior periods, and to also to assess its overall effectiveness and efficiency.
Cash operating costs includes mine site operating costs such as mining costs, plant and maintenance costs, sustainability
costs, mine and plant administration costs, royalties and sales, general and administrative costs (all for the Mine properties
segment), but excludes depreciation and amortization, share-based payments, foreign exchange gains or losses, commissions,
reclamation, capital expenditures and exploration and evaluation costs. Operating costs not attributable to the Mine
properties segment are also excluded, including conversion costs, product acquisition costs, distribution costs and inventory
write-downs.
Cash operating costs excluding royalties is calculated as cash operating costs less royalties.
Adjusted cash operating costs excluding royalties is calculated as cash operating costs excluding royalties less write-downs
of produced products.
Cash operating costs per pound, cash operating costs excluding royalties per pound and adjusted cash operating costs
excluding royalties per pound are obtained by dividing cash operating costs, cash operating costs excluding royalties and
adjusted cash operating costs excluding royalties, respectively, by the pounds of vanadium equivalent sold that were
produced by the Maracas Menchen Mine.
Cash operating costs, cash operating costs excluding royalties, adjusted cash operating costs excluding royalties, cash
operating costs per pound, cash operating costs excluding royalties per pound and adjusted cash operating costs excluding
royalties per pound, along with revenues, are considered to be key indicators of the Company's ability to generate operating
earnings and cash flow from its Maracas Menchen Mine. These measures differ from measures determined in accordance
with IFRS, and are not necessarily indicative of net earnings or cash flow from operating activities as determined under
IFRS.
The following table provides a reconciliation of cash operating costs, cash operating costs excluding royalties, adjusted cash
operating costs excluding royalties, cash operating costs per pound, cash operating costs excluding royalties per pound and
adjusted cash operating costs excluding royalties per pound for the Maracas Menchen Mine to operating costs as per the QI
2025 unaudited condensed interim consolidated financial statements.