Sigma Lithium Reports 1Q 2024 Results: May Shipment Priced at $1,290, Increased 25% from 1Q; Production Costs at $397/t, 2ND Lowest IN Industry First Quarter 2024 Highlights ($ USD)
SIGMA LITHIUM REPORTS 1Q 2024 RESULTS:
MAY SHIPMENT PRICED AT $1,290, INCREASED 25% FROM 1Q;
PRODUCTION COSTS AT $397/t, 2ND LOWEST IN INDUSTRY
FIRST QUARTER 2024 HIGHLIGHTS ($ USD)
• Strengthened commercial position in May, achieving a premium price of USD $1,290/t, at a fixed formula
of 9% of lithium hydroxide quoted at LME, delivering:
o 11% price increase from April
o 25% price increase from 1Q24 realized sales price (USD $930/t or $1,035/t on a 6% basis)
• Revenues from volumes of Quintuple Zero High Purity Lithium Concentrate sold in 1Q totaled $49.1
million.
o Sales volumes totaled 52,857/t
o Production volumes totaled 54,168/t
• Reduced reported cash cost by 16% from 4Q23, approaching 3Q cost guidance:
o FOB cash costs of $462/t (guidance $420/t)
o Cash costs at industrial plant gate averaging $397/t (guidance of $370/t)
• Robust 1Q24 EBITDA margins:
o 35.3% margins on pro forma EBITDA(3) of $17.4 million, generated by business conducted in 1Q24.
o 15.8% margins on reported 1Q adjusted EBITDA of $5.9 million.
• Board of Directors made a Final Investment Decision to build a second Greentech Industrial Plant that
will increase production capacity to 520,000/t of Quintuple Zero Green Lithium from the current
270,000 t/year.
• Extended operational life to 25 years at the Company’s 100% owned Grota do Cirilo industrial-mineral
complex at an industrial throughput of 520,000 t/year: Increase of 40% in proven and probable mineral
reserves to 77 million tonnes (from 54.8 million tonnes).
Conference Call Information
The Company will conduct a conference call to discuss its financial results for the first quarter at 12:00 p.m. EST
on Thursday, May 16, 2023. Participating on the call will be Co -Chairperson and Chief Executive Officer, Ana
Cabral. To register for the call, please proceed through the following link Register here. For access to the
webcast, please Click here.
SAO PAULO (May 16, 2024) – SIGMA Lithium Corporation (“Sigma Lithium” or the “Company”) (NASDAQ: SGML,
TSXV: SGML, BVMF: S2GM34), a leading global lithium producer dedicated to powering the next generation of
electric vehicles with carbon neutral, responsibly sourced chemical grade lithium concentrate, today announced its
results for the first quarter ended March 31, 2024. The Quarterly Filings and accompanying Management Discussion
and Analysis (“MD&A”) are available on SEDAR+ ( www.sedarplus.ca), EDGAR ( www.sec.gov) and the Company's
corporate website.
Ana Cabral, Co-Chairperson and CEO said: "During 2024, Sigma has delivered on several key milestones aimed
at doubling industrial capacity by 2025. We made the final investment decision to initiate construction of a second
Greentech plant, and we extended operational life to 25 years at Grota do Cirilo by increasing our audited proven
and probable mineral reserve by 40% . Our entire team is focused on the execution of this industrial and mineral
capacity expansion, repeating the success of Phase 1 by delivering this second stage of operational growth on
time and on budget.”
She added : “Operationally, our team has been progressing consistently towards achieving robust cash flow
generation for 2024 . We continue to premiunize the price of our Quintuple Zero Green Lithium, increasing May
prices by 11% from April, and a nearly 30% from the 1Q24 average realized prices. We reduced reported cash cost
by 16% vs 4Q23, approaching guidance.
Key Performance Metrics for Quarter Ended 31 March 2024 ($ USD)
Unit 1Q24 4Q23
Concentrate Produced tonnes 54,168 59,938
Concentrate Grade Produced % 5.4% 5.3%
Concentrate Sold tonnes 52,857 64,670
Reported Revenue $ 000s 37,202 37,688
Average Reported Selling Price $/t 704 583
Revenue for Business Conducted in 1Q $ 000s 49,141 67,500
Average Realized Selling Price in 1Q $/t 930 1,067
Unit Operating Cost (1) $/t 397 478
Adjusted EBITDA (2) $ 000s 5,878 1,295
Net Income $ 000s (6,962) (9,500)
Cash and Cash Equivalents $ 000s 108,191 48,584
Sigma Lithium made two full shipments of its Quintuple Zero Green Lithium concentrate during the first quarter as
the March shipment was concluded in the first week of April.
• Sales were supplemented by an additional sale to Glencore AG of volumes at port totalling 8,700 /t at the end
of the quarter.
• Revenues associated with volumes sold in the first quarter totaled $49 million , implying a realized FOB sales
price of $930/t.
• Reported revenues for the first quarter totaled $37.2 million (C$50.4 million).
o Provisional price adjustments reduced 1Q24 revenues by USD $12 million, an improvement from the $30
million price adjustment in 4Q23, as lithium concentrate prices turned upward after the Lunar New Year.
Cash unit operating costs(1) for lithium concentrate produced at the Company’s Grota do Cirilo operations in the first
quarter averaged USD $397/t. The 4Q cash cost FOB Vitoria (which includes transportation and port charges)
averaged USD $462/t (or $483/t with royalties).
• This is a nearly 16% improvement from the reported FOB costs in 4Q23 and is an important step to meeting
Company cost targets of $370/t plant gate and $420/t FOB.
• Sigma Lithium has already seen an improvement in its cost structure given productivity actions taken, and notes
that production at the processing plant was the primary hinderance to achieving guided costs during the first
quarter. The Company reiterates its expectation to achieve guidance within 2Q24 for 3Q average realization.
The Company delivered first quarter adjusted EBITDA of $5.9 million (C$8.1 million) , reflecting a margin of 15.8% .
Reported EBITDA for the first quarter totaled $3.1 million (C$4.3 million).
• This number includes $0.5 million (C$0.7 million) of non-recurring expenditures, including those associated with
the strategic review, and $2.3 million (C$3.1 million) in non-cash stock-based compensation expenses.
1Q24 results had a $12 million provisional price adjustment to revenues resulting from shipments in the 4Q23.
Without this provisional price adjustment, the Company delivered a pro forma adjusted EBITDA for business
conducted in 1Q24 of $17.4 million, implying a margin of more than 35%.
Net income in the quarter was a loss of $7.0 million (C$9.3 million), or ($0.06) per diluted share outstanding.
Operational Update and Phase 2 Expansion
Lithium concentrate production in the first quarter totaled 54,168 tonnes, compared to the 59,938 tonnes produced
in 4Q23. No single factor weighed materially on production, but it was impacted, in part, by holiday seasonality and
fewer work days. Sigma maintained a delivery schedule of approximately 35 days. The Company has successfully
continued to improve Greentech plant efficiency in 2024, and notes that production improved sequentially through
the course of the first quarter.
On April 1, 2024, the Board of Directors announced a Final Investment Decision (“FID”) for the Company’s Phase 2
Greentech Plant expansion. The project is expected to add 250,000 tonnes of production capacity to the current
270,000-tonne Phase 1 operation. Earthworks engineering is ongoing. Building and commissioning are expected
to occur within 12 months of the FID announcement, with the first commercial production expected in 2Q25. The
total expected capex for the Phase 2 construction is $100 million (C$136 million), and the Company has already
secured all relevant environmental licenses to build and operate the second Greentech Plant.
Ninth Shipment Scheduled for the week of May 20
The Company is also announcing today that it has finalized pricing discussions for its ninth shipment of Quintuple
Zero Green Lithium concentrate scheduled for the week of May 20th . The 22,000/t shipment will be priced at the
formula of 9% of the LME/Fastmarkets lithium hydroxide benchmark, implying $1,29 0/t at today’s market
($1,459/tonne gross of VAT).
The current value of the May shipment reflects an 11% price increase over the Company’s eighth shipment in April,
where the $1,160/tonne secured price was equivalent to 8.75% of the LME/Fastmarkets Lithium Hydroxide prices.
A similar p rice discovery process was followed through closed private bidding for the fixed portion of the price
formula, though the final economics will depend on LME/ Fastmarkets lithium hydroxide benchmark at one month
after the landing of the shipment . Sigma Lithium will continue to adapt its marketing strategy to maximize the
commercial value of its premium Quintuple Zero Green Lithium
Sigma Lithium Commercial Director Catarina Noci, stated: “ The economics for our May shipment represent a
continuation in the market recovery that started in the days following the Lunar New Year. Indications from the market
point to a firm outlook for lithium concentrate as we enter the price discovery process for our next shipment in June.
Demand for our Quintuple Zero Green Lithium continues to be robust as a result of its superior chemical properties
and coarse particles . We will evolve our pricing strategy to follow market dynamics in order to capture as much as
possible of the 20-30% cost savings embedded in the “value-in-use” we deliver to our downstream clients.”
Balance Sheet & Liquidity
Sigma Lithium ended the first quarter with $ 108.2 million (C$ 146.4 million) in cash and cash equivalents. This
represents a material increase from the $48.5 million in cash at the quarter ended Dec. 31, 2023. At the end of the
quarter, the Company had $ 201 million (C$ 272 million) in short and long -term loans and export prepayment
liabilities. This included $89 million in drawn and available, but unutilized, liquidity through trade finance lines.
Capital expenditures during the first quarter totaled $ 5.6 million (C$7.6 million) directed to wards maintenance,
exploration as well as incremental investments in the Greentech Plant to boost production. In total, the Company’s
net debt position over the course of 1Q increased by $1 3 million, reflecting the annual interest payment made in
connection with the outstanding debt.
Free cash flow was a modest drag as a result of lower market prices in the quarter , higher receivables, as well as
the conclusion of the March shipment taking place in the first week of April ( resulting in one less shipment made
during the 1Q24 compared with 4Q23).
ABOUT SIGMA LITHIUM
Sigma Lithium (NASDAQ: SGML, TSXV: SGML, BVMF: S2GM34) is a leading global lithium producer dedicated
to powering the next generation of electric vehicle batteries with carbon neutral, socially and environmentally
sustainable chemical-grade lithium concentrate.
Sigma Lithium operates at the forefront of environmental and social sustainability in the EV battery materials
supply chain and is currently producing Quintuple Zero Green Lithium concentrate from its Grota do Cirilo Project
in Brazil. Phase 1 of the project entered commercial production in 2Q23 and has an annual capacity of 270,000
tonnes of concentrate (36,700 LCE annually). The Company is currently working to expand production via a
Phase 2 concentrate line and associated mine which would add another 250,000 tonnes of Quintuple Zero Green
Lithium capacity annually. The project produces lithium concentrate at its state-of-the-art Greentech lithium plant
that uses 100% renewable energy, 100% recycled water and 100% dry -stacked tailings.
Please refer to the Company’s National Instrument 43 -101 technical report titled “Grota do Cirilo Lithium Project
Araçuaí and Itinga Regions, Minas Gerais, Brazil, Amended and Restated Technical Report” issued March 19,
2024, which was prepared for Sigma L ithium by Homero Delboni Jr., MAusIMM, Promon Engenharia; Marc -
Antoine Laporte, P.Geo, SGS Canada Inc; Jarrett Quinn, P.Eng., Primero Group Americas; Porfirio Cabaleiro
Rodriguez, (MEng), FAIG, GE21 Consultoria Mineral; and William van Breugel, P.Eng (the “Updated Technical
Report”). The Updated Technical Report is filed on SEDAR and is also available on the Company’s website.
For more information about Sigma Lithium, visit https://www.sigmalithiumresources.com/
FOR ADDITIONAL INFORMATION PLEASE CONTACT
Matthew DeYoe, EVP, Corporate Affairs and Strategic Development
+1 (201) 819-0303
Daniel Abdo, Director, Investor Relations
+55 11 2985-0089
Sigma Lithium
Sigma Lithium
@sigmalithium
@SigmaLithium
FORWARD-LOOKING STATEMENTS
This news release includes certain “forward -looking information” under applicable Canadian and U.S. securities legislation,
including but not limited to statements relating to timing and costs related to the general business and operational outlook of the
Company, the environmental footprint of tailings and positive ecosystem impact relating thereto, donation and upcycling of tailings,
timing and quantities relating to tailings and Green Lithium, achievements and projections relating to the Zero Tailings st rategy,
achievement of ramp -up volumes, production estimates and the operational status of the Grota do Cirilo Project, and other
forward-looking information. All statements that address future plans, activities, events, estimates, expectations or developments
that the Company believes, expects or anticipates will or may occur is forward-looking information, including statements regarding
the potential development of mineral resources and mineral reserves which may or may not occur. Forward -looking information
contained herein is based on certain assumptions regarding, among other things: general economic and political conditions; th e
stable and supportive legislative, regulatory and community environment in Brazil; demand for lithium, including that such demand
is supported by growth in the electric vehicle market; the Company’s market position and future financial and operating
performance; the Company’s estimates of mineral resources and mineral reserves, includi ng whether mineral resources will ever
be developed into mineral reserves; and the Company’s ability to operate its mineral projects including that the Company will not
experience any materials or equipment shortages, any labour or service provider outages or delays or any technical issues.
Although management believes that the assumptions and expectations reflected in the forward -looking information are
reasonable, there can be no assurance that these assumptions and expectations will prove to be correct. Forward -looking
information inherently invol ves and is subject to risks and uncertainties, including but not limited to that the market prices for
lithium may not remain at current levels; and the market for electric vehicles and other large format batteries currently has limited
market share and no assurances can be given for the rate at which this market will develop, if at all, which could affect the success
of the Company and its ability to develop lithium operations. 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 forward -looking information. The Company disclaims any intention or obligation to update or
revise any forward-looking information, whether because of new information, future events or otherwise, except as required by
law. For more information on the risks, uncertainties and assumptions that could cause our actual results to differ from curr ent
expectations, please refer to the current annual information form of the Company and other public filings available under the
Company’s profile at www.sedarplus.com.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
Figure 1: Income Statement Summary
Three Months Ended
Mar. 31, 2024
Three Months Ended
Mar. 31, 2024
($000) CAD USD
Revenue 50,408 37,202
Operating costs (38,722) (28,642)
Gross profit 11,686 8,560
G&A expense (5,882) (4,363)
Sales expense (1,166) (861)
Stock-based compensation (3,066) (2,266)
ESG and other operating expenses (1,887) (1,400)
EBIT (315) (329)
Financial income and FX (expenses), net (9,614) (7,104)
Income (loss) before taxes (9,929) (7,433)
Income taxes and social contribution 585 471
Net Income (loss) for the period (9,344) (6,962)
Weighted avg diluted shares outstanding 110,460,681 110,460,681
Earnings per share $ (0.08) $ (0.06)
Figure 2: Balance Sheet Summary
Three Months
Ended Mar. 31,
2024
Twelve
Months Ended
Dec. 31 2023
Three Months
Ended Mar. 31,
2024
Twelve
Months Ended
Dec. 31 2023
($000) CAD CAD USD USD
Assets
Cash and cash equivalents 146,393 64,403 108,191 48,584
Trade accounts receivable 39,276 29,693 29,027 22,400
Other current assets 51,114 48,580 37,776 36,647
Total current assets 236,783 142,676 174,993 107,631
Property, plant and equipment 236,824 239,742 175,023 180,856
Other non-current assets 107,613 104,820 79,530 79,074
Total Assets 581,220 487,238 429,546 367,561
Liabilities & Shareholder Equity
Financing and export prepayment 127,149 28,907 93,968 21,807
Accounts payable 62,918 59,826 46,499 45,131
Other current liabilities 32,047 33,640 23,691 25,377
Total current liabilities 222,114 122,373 164,159 92,315
Financing and export prepayment 145,488 141,999 107,522 107,121
Other non-current liabilities 8,344 8,582 6,167 6,474
Total non-current liabilities 153,832 150,581 113,689 113,595
Total shareholders' equity 205,274 214,284 151,699 161,651
Total Liabilities & Shareholders' Equity 581,220 487,238 429,546 367,561
Figure 3: Cash Flow Statement Summary
Three Months Ended
Mar. 31, 2024
Three Months Ended
Mar. 31, 2024
($000) CAD USD
Operating Activities
Net income (loss) for the period (9,344) (6,962)
Adjustments 20,487 15,261
Interest payment on loans and leases (15,194) (11,266)
Adjustments to income (loss) for the period (4,051) (2,967)
Change in working capital (11,341) (8,449)
Net Cash from Operating Activities (15,392) (11,416)
Investing Activities
Purchase of PPE (5,303) (3,952)
Addition to exploration and evaluation assets (2,248) (1,667)
Other (55) (41)
Net Cash from Investing Activities (7,606) (5,660)
Financing Activities
Proceeds of loans, net 106,862 79,237
Other (846) (627)
Net Cash from Financing Activities 106,016 78,610
Effect of FX (1,028) (1,927)
Net (decrease) increase in cash 81,990 59,607
Cash & Equivalents, Beg of Period 64,403 48,584
Cash & Equivalents, End of Period 146,393 108,191
Endnotes:
(1) Cash Operating Costs per ton ne include mining, crushing, processing, and site administration expenses. When shown as Fre ight on
Board (FOB), these expenses include transport and port charges. For clarity, non-site G&A, and royalty costs are excluded unless
otherwise noted.
(2) Adjusted EBITDA represents a cash operating profit metric that nets revenues against cost of goods sold, selling, general, administrative
and other cash operating expenses. Adjusted EBITDA also excludes stock-based compensation and certain non-recurring expenses,
such as those related to the Company’s strategic review.
(3) Pro forma Adjusted EBITDA utilizes the same formula as Adjusted EBITDA, though it backs out the implications of the provisional price
adjustment to associated revenues and costs. The Company believes this is a more accurate reflection of business conducted within
the quarter.
Reconciliation
To provide investors and others with additional information regarding the financial results of Sigma Lithium, we have disclos ed in
this release certain non -IFRS operating performance measures of EBITDA, EBITDA margin, Adjusted EBITDA, and Adjusted
EBITDA margin. These non-IFRS financial measures are a supplement to and not a substitute for or superior to, the Company's
results presented in accordance with IFRS. The non-IFRS financial measures presented by the Company may be different from
non-GAAP/IFRS financial measures presented by other companies. Specifically, the Company believes the non-IFRS information
provides useful measures to investors regarding the Company's financial performance by excluding certain costs and expenses
that the Company believes are not indicative of its core operating results. The presentation of these non-U.S. GAAP/IFRS financial
measures is not meant to be considered in isolation or as a substitute for results or guidance prepared and presented in
accordance with U.S. GAAP/IFRS. A reconciliation of these financial measures to IFRS results is included herein.
Figure 4: Adjusted EBITDA Bridge
Three Months Ended
Mar. 31, 2024
Three Months Ended
Mar. 31, 2024
($ 000) CAD USD
Revenues 50,408 37,202
Cost of goods sold (38,722) (28,642)
Gross Profit 11,686 8,560
G&A expense (5,882) (4,363)
Sales expenses (1,166) (861)
Stock-based compensation (3,066) (2,266)
ESG & other operating expenses, net (1,887) (1,400)
EBIT (315) (329)
Depreciation & Amortization 4,622 3,443
EBITDA 4,307 3,114
EBITDA (%) 8.5% 8.4%
Non-recurring expenses 678 499
Accounting Services 443 324
Other G&A 235 174
Stock-based compensation 3,066 2,266
Adjusted EBITDA 8,051 5,878
Adjusted EBITDA (%) 16.0% 15.8%