RE:RE:Largo 2021 EPS.: Actual vs Analyst ForecastDrhoho wrote: My read on the market reaction, notwithstanding no analyst change yet forecast, was Ernest Cleave's response to Leon Cooperman's question of LGO's anticipated free cash in the bank at the conclusion of 2022: an increase of the 2021 end of year ~$US 80 million to ~ $US 180 million, an increase of $US 100 million before paying off the only remaining debt of ~$US 17 million to become debt free this year. Cleave had no explanation of how the company was to do this, but did provide, to further Cooperman questions about years beyond 2022, that he anticipated annual numbers in $US100's of millions. Those numbers prompted Cooperman's question of what the company was going to do with that cash. Cleave's response was that the BOD was already in discussion as to what to do this year and in future years. Cooperman, as he has advocated in the past, favored buying shares back on the open market rather than dividends, and Cleave appeared to agree. I was impressed by Cleave's rapid response. I think what he expressed as CFO is his looking at the numbers of the proposed LPV setup, with the assumption that it will materialize, and how it will result to LGO benefit this year and beyond. I did not have the sense that he had any firm grip on 2022 cash income coming in from LCE/VRFB contracts, TiO2 cash income, or even V2O3 cash income above and beyond what Maracas V2O5 provides. Getting back to the free cash end of 2022 noted above, that number results after all setup expenses to complete V2O3 production, cost of LCE expenses without 2022 income, as far as we know, and much of TiO2 setup costs, also with no 2022 income. What a wonderful thing to have Maracas production paying for all of that, not requiring additional equity or debt financing. It goes without saying that so much depends on V2O5 commodity pricing staying up and strong. No question that things have not been going well for several years, but I believe there is much for us to look forward to in the rest of 2022 and the foreseeable future. If this proves to be accurate, those criticized management compensation packages will prove worthwhile for them and all of us. I
One year later: What has become of the high hopes? CRUSHED! Instead of holding 100M+ cash, the company feels the need to take on additional debt in order to get at least one of the two plants currently under construction completed. The other one (TiO2) is scrapped and all the money already spent on planning, engineering, site works etc. won't see any revenues in return for the foreseeable future. Yet another case of brilliant execution!