Largo’s strong financial position. As Andrew D. Wong wrote
We expect Largo to be in a position to return capital to shareholders later in 2020 through
dividends and share buybacks, as the expiration of the Glencore contract, completion of the
expansion, and expected improvement in the vanadium market provides more certainty on
cash flows. At the company’s annual shareholder meeting on June 27, 2019, management
announced that it did not intend to return capital to shareholders at the current time, citing
near-term vanadium market challenges, cash flow drag from the Glencore contract
remeasurements, and working capital requirements for building up the company’s sales and
trading capability. Although the decision was disappointing, we think it was also sensible to
protect Largo’s strong financial position.