Teal Valley T.TV

Largo Resources Announces Solid Third Quarter 2020 Results

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Q3 2020 Highlights

• Solid financial position: Cash at September 30, 2020 totaled $74.9 million
• Revenues of $27.5 million, an increase of 14% over Q3 2019
• Revenues per pound sold7 of $5.37, a 34% increase over Q3 2019
• Net income of $2.6 million vs. a net loss of $6.0 million in Q3 2019
• Total sales exceeded production levels in August and September 2020 for the first time since commercial independence, highlighting successful implementation of the Company's strategy
• Cash provided (used) before working capital items of $4.8 million vs. cash used in Q3 2019 of $3.8 million
• Record production of 3,092 tonnes (6.8 million pounds1) of V2O5, an increase of 5.0% over Q3 2019
• Record global V2O5 recovery rate2 of 84.2% in Q3 2020, an increase of 8.0% over Q3 2019
• Continued low-cost operations: Cash operating costs excluding royalties3 of $3.14 per lb of V2O5, compared with $3.02per lb in Q3 2019; Total cash costs3 were $3.69 per lb in Q3 2020

Other Significant Highlights

• 2020 cash cost guidance reduced: Cash operating cost excluding royalties3guidance lowered to $2.60 – $2.80 / lb V2O5 from $3.05 – $3.25 / lb; Total cash cost3 guidance lowered to $3.20 to $3.40 / lb V2O5 from 3.45 – $3.65/ lb
• Postponing cost-efficient nameplate capacity increase to Q1 2021: Planned kiln upgrades and cooler maintenance that will increase Largo's production capacity by 10% with a CAPEX of only $1.3 millionare postponed to Q1 2021 due to COVID-19 restrictions
• Focus on safe business continuity: On track to meet lower end of 2020 production guidance with strong production results expected in Q4 2020; 2020 sales guidance maintained
• 2020 drilling program update: Drilling was ramped up in Q3 2020 with 14,007 metres (80 holes) completed