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Largo Inc T.LGO

Alternate Symbol(s):  LGO

Largo Inc. is a Canada-based producer and supplier of vanadium products. The Company’s segments include sales & trading, mine properties, corporate, exploration and evaluation properties (E&E properties), Largo Clean Energy and Largo Physical Vanadium. Its VPURE and VPURE+ products, which are sourced from one of the vanadium deposits at the Company's Maracas Menchen Mine in Brazil. The Company is also focused on the advancement of renewable energy storage solutions through Largo Clean Energy and its vanadium redox flow battery technology (VRFB). The Company is also engaged in the process of implementing a titanium dioxide pigment plant using feedstock sourced from its existing operations, in addition to advancing its United States-based clean energy division with its VCHARGE vanadium batteries. VPURE+ Flakes are used in the production of master alloys, where it provides high strength-to-weight ratios for the titanium alloy and aerospace industries.


TSX:LGO - Post by User

Post by kha341on Nov 09, 2023 8:35pm
192 Views
Post# 35727425

Will 2024 be our recovery year?

Will 2024 be our recovery year?

I expect Q4 2023 to be another difficult period for Largo. Headwinds abound. It would not be a surprise for me to see the sp lingering below C$3-4 for the rest of 2023. So let's focus on 2024 


Will Largo be able to embark on the road to recovery in 2024? I hope so.

However the only concrete bright spot for 2024 that I can find in the Q3-23 Earnings Call transcript is the “light” Ilmenite project. Why do I call it a “light” Ilmenite project? Because the 2024 expectation has gone down from 

“4-5 months-ramp-up-required-to-achieve-a-full-production-capacity-of-12,000T-per-mth” (145,000T/year) to  “8-months-ramp-up-required-to-achieve-a-full-production-capacity-of-8,000-9,000-per-mth-in-April-2024”


On the energy front, I expect LCE to continue to incur costs / consume cash without generating significant revenues in 2024. 

In Q3-23 Largo’s mining operating costs alone = 97% of revenues despite Daniel Tellechea focus on cost reduction. Will management be able to reduce the operating costs to let’s say 85% (for the sake of argument) in 2024? 


I dare say (but it’s just me) that the following projects / conditions are prerequisite for Largo to embark on the road to recovery in 2024:

1) Successful delivery of the Ilmenite revenue stream (within management control)

2) Successful cost reduction in a meaningful way (within management control)

3) Successful  delivery of strategic alternatives for LCE (within management control), and

4) Most important of all: A strong V price throughout the year (US$9.00/lb or higher)


DYODD

 




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