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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 May 07, 2024 6:25pm
119 Views
Post# 36027763

Calmac9sh

Calmac9sh

Good points. 

I made money with LGO when the company was under the leadership of Brennan and Smith. Since commercial independence things went downhill. Paulo Misk, our former CEO, was a bad leader. Ernest Cleave, an overpaid condescending CFO who could not hold a job for more than 2 years anywhere else other than Largo is not shy from showing his disagreement with the BoD in public. Paul Vollant, a newly hired Sales Director who gets fast tracked up to VP Commercial and President LPV in record time, is known for providing misleading information to the public. Furthermore the fact that the top executives with 7-figure compensation have no skin in the game speaks volumes about their loyalty to Largo and its shareholders. The anti-transparency corporate culture makes things worse. Commodities, especially in mining, are definitely cyclical. And yet  Largo ended up in red ink (negative ESP) when V2O5 prices were as high as US$8 - $10.72/lb in the past 2 years. 

NPV valuation of US$2bn? So outdated. That base case study was based on an average sale of 13,200T of V2O5 per annum starting from 2022 which is ~30% higher than the maximum range of our actual sale guidance (10,700T). It also expected a considerable revenue stream from TiO2 starting from 2024. The 3 phases of the TiO2 project would require ~$300M to complete. The project is now on the back burner until management figures out the financing.  

The following table illustrates how unrealistic the base case study was even from 2022 to 2025:


In 1,000










Comparison between base case data and actuals (2022 & 2023)

US$

1

2

3

4

5

6

7

Item

2022 Base Case Study

2022 Actual

2022 Differences

col.3 minus col.2

2023 Base Case Study

2023 Actual

2023 Differences 

col.6 minus col.5

Gross Revenue

260.9M

229.3M

(31.6M)

296.5M

198.7M

(97.8M)

Net Income (Loss)

118.3M

(2.2M)

(120.5M)

130.2M

(32.4M)

(162.6M)




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