Lithium Americas (Argentina) Corp. (“
Lithium
Argentina,” the “
Company,” or
“
LAAC”) (
TSX: LAAC)
(
NYSE: LAAC), today announced first quarter
results.
Highlights
- Operational Highlights
- During the three months ended March
31, 2024, Caucharí-Olaroz produced approximately 4,500 tonnes of
lithium carbonate.
- The project continues to advance
through the ramp up and test higher production levels.
- In April 2024, a planned shutdown
was performed to inspect and improve reliability of the processing
plant.
- Caucharí-Olaroz remains on target
to produce 20,000 - 25,000 tonnes of lithium carbonate in 2024.
- The target remains to reach and
maintain a near steady state production level by the end of the
year.
- For 2024, Caucharí-Olaroz expects
to be operating cash flow positive when adjusted for working
capital changes.
- Working capital requirements are
expected to remain elevated through the first half of 2024 as
production continues to ramp up and sales shipments begin to
normalize.
- Financial
Highlights
- As of March 31, 2024, Lithium
Argentina had $86M in cash and cash equivalents with an additional
$20M in collateral related to loans to Caucharí-Olaroz expected to
be released in Q2 2024.
- The Company has not drawn on its
$75M credit facility with Ganfeng Lithium Co. Ltd.
(“Ganfeng”) and has $259M in convertible debt at
1.75% due in early 2027.
- As of March 31, 2024, Minera Exar
S.A. (“Minera Exar”), the Argentine joint venture
company owned by the Company (44.8%), Ganfeng (46.7%) and Jujuy
Energia y Mineria Sociedad del Estado (“JEMSE”)
(8.5%) had approximately $241M (on a 100% basis, less cash
collateral) of local debt tied to funding working capital and
startup costs.
- A substantial portion of the local
debt is being refinanced with unsecured credit facilities typical
of an operating company.
- The Company is working with Ganfeng
to pursue additional longer term debt options to leverage improved
lending conditions in Argentina and support future growth
plans.
- Corporate
Highlights
- On March 5,
2024, Ganfeng agreed to invest $70M for an expected 15% stake in
the Pastos Grandes project through a subscription of newly-issued
shares of the Company’s Argentine subsidiary, Proyecto Pastos
Grandes S.A. (the “Pastos Grandes Transaction”).
The transaction is expected to close mid-2024 with proceeds
available to support the Company’s Argentine operations.
- In the first
quarter of 2024, the Company commenced additional measures to
reduce discretionary spending at the corporate level by 25%.
- The Company will hold its Annual
General Shareholders Meeting on June 20, 2024.
Commenting on the results for the three-month
period ended March 31, 2024, Sam Pigott, CEO, Lithium Argentina
commented:
“I am proud of how the team at Caucharí-Olaroz
continues to advance through the ramp up and progress towards a
capacity of 40,000 tonnes per annum. During the first quarter 2024,
the production volumes totaled approximately 4,500 tonnes, about
20% higher than volumes produced during the fourth quarter. The
Company remains focused on completing the ramp-up at
Caucharí-Olaroz, prioritizing prudent financial management
practices to ensure the company remains sufficiently capitalized
and advancing the regional development plan for the Pastos Grandes
basin with Ganfeng.”
Mr. Pigott continued by saying, “In recent
months, we worked closely with Ganfeng to advance local debt
options in Argentina to take advantage of improved lending
conditions in Argentina and the transition to an operating
business. These actions will enhance financial flexibility to
advance near-term growth, minimize dilution and preserve future
opportunities to create shareholder value.
He closed by saying, “Looking ahead, we remain
optimistic about the outlook for the lithium industry, which is
buoyed by favorable demand fundamentals and has seen positive
pricing trends in recent months. With Caucharí-Olaroz operating and
a regional development plan being advanced and a talented team of
professionals in Argentina and abroad, we are well-positioned to
navigate the challenges and capitalize on the opportunities that
lie ahead.”
INVESTOR WEBCAST
AN INVESTOR WEBCAST HAS BEEN SCHEDULED FOR 10:00am ET ON
TUESDAY, MAY 14, 2024.
Please use the following link to access:
First Quarter 2024 Results Webcast
FINANCIAL RESULTS
Selected consolidated financial information is
presented as follows:
(in US$ million except per share information) |
Quarters ended March 31, |
|
2024 |
|
|
2023 |
|
|
$ |
|
$ |
Expenses |
|
(20.8 |
) |
|
|
(9.7 |
) |
Net loss |
|
(10.2 |
) |
|
|
(6.4 |
) |
Loss per share – basic |
|
(0.06 |
) |
|
|
(0.04 |
) |
(in US$ million) |
As at March 31, 2024 |
|
As at December 31, 2023 |
|
|
$ |
|
$ |
|
Cash and cash equivalents |
|
86.2 |
|
|
|
122.3 |
|
|
Total assets |
|
1,046.1 |
|
|
|
1,055.0 |
|
|
Total liabilities |
|
(226.0 |
) |
|
|
(226.1 |
) |
|
In Q1 2024, net loss was attributable to
expenses in the period partially offset by a gain on change in fair
value of the convertible note derivative liability.
In Q1 2024, total assets decreased primarily due
to a decrease in cash and cash equivalents which were used to fund
the Company’s operations and a decrease in investment in the
Caucharí-Olaroz project due to elimination of the Company’s portion
of capitalized intercompany interest, partially offset by an
increase in loans advanced to Exar Capital.
This news release should be read in conjunction
with Lithium Argentina’s condensed consolidated interim financial
statements and management's discussion and analysis for the quarter
ended March 31, 2024, which are available on SEDAR+. All amounts
are in U.S. dollars unless otherwise indicated.
ABOUT LITHIUM ARGENTINA
Lithium Argentina is an emerging producer of
lithium carbonate for use primarily in lithium-ion batteries and
electric vehicles. The Company, in partnership with Ganfeng Lithium
Co, Ltd., is ramping up production of the Caucharí-Olaroz lithium
brine operation in Argentina and advancing development of
additional lithium resources in the region. Lithium Argentina
currently trades on the TSX and on the NYSE, under the ticker
symbol “LAAC.”
For further information contact:Investor
RelationsTelephone: +54-11-52630616Email:
ir@lithium-argentina.comWebsite: www.lithium-argentina.com
TECHNICAL INFORMATION
The Technical Information in this news release
with respect to Caucharí-Olaroz, has been reviewed and approved by
Ernest Burga, P.Eng., a Qualified Person as defined by National
Instrument 43-101 independent of the Company.
FORWARD-LOOKING INFORMATION
This news release contains “forward-looking
information” within the meaning of applicable Canadian securities
legislation and “forward-looking statements” within the meaning of
the United States Private Securities Litigation Reform Act of 1995
(collectively referred to herein as “forward-looking information”).
These statements relate to future events or the Company’s future
performance. All statements, other than statements of historical
fact, may be forward-looking information. Forward-looking
information generally can be identified by the use of words such as
“seek,” “anticipate,” “plan,” “continue,” “estimate,” “expect,”
“may,” “will,” “project,” “predict,” “propose,” “potential,”
“targeting,” “intend,” “could,” “might,” “should,” “believe” and
similar expressions. These statements involve known and unknown
risks, uncertainties and other factors that may cause actual
results or events to differ materially from those anticipated in
such forward-looking information.
In particular, this news release contains
forward-looking information, including, without limitation, with
respect to the following matters or the Company’s expectations
relating to such matters: 2024 expected production for the
Caucharí-Olaroz project; goals of the Company; development of the
Caucharí-Olaroz project, including timing of the ramp up in
production capacity and product quality, timing of commissioning
and ramp up of the KCI plant; expectations with respect to regional
development planning for the Pasto Grandes basin and the timing
thereof; and the timing of closing of the Pastos Grandes
Transaction.
Forward-looking information does not take into
account the effect of transactions or other items announced or
occurring after the statements are made. Forward-looking
information contained in this news release is based upon a number
of expectations and assumptions and is subject to a number of risks
and uncertainties, including but not limited to those related to:
current technological trends; a cordial business relationship
between the Company and third party strategic and contractual
partners, including the co-owners of the Caucharí-Olaroz project;
ability of the Company to fund, advance, develop and ramp up the
Caucharí-Olaroz project, the impacts of the project when full
production commences; ability of the Company to advance and develop
the Pastos Grandes and Sal de la Puna projects; the Company’s
ability to operate in a safe and effective manner; uncertainties
relating to receiving and maintaining mining, exploration,
environmental and other permits or approvals in Argentina; demand
for lithium, including that such demand is supported by growth in
the electric vehicle market; the impact of increasing competition
in the lithium business, and the Company’s competitive position in
the industry; general economic, geopolitical, and political
conditions; the stable and supportive legislative, regulatory and
community environment in the jurisdictions where the Company
operates; regulatory, and political matters that may influence or
be influenced by future events or conditions; local and global
political and economic conditions; governmental and regulatory
requirements and actions by governmental authorities, including
changes in government policies; stability and inflation of the
Argentine peso, including any foreign exchange or capital controls
which may be enacted in respect thereof, and the effect of current
or any additional regulations on the Company’s operations; the
impact of unknown financial contingencies, including litigation
costs, on the Company’s operations; gains or losses, in each case,
if any, from short-term investments in Argentine bonds and
equities; estimates of and unpredictable changes to the market
prices for lithium products; development and ramp up costs for the
Caucharí-Olaroz project, and costs for any additional exploration
work at the projects; uncertainties inherent to estimates of
Mineral Resources and Mineral Reserves, including whether Mineral
Resources not included in Mineral Reserves will be further
developed into Mineral Reserves; reliability of technical data;
anticipated timing and results of exploration, development and
construction activities; the receipt of required approvals for and
timing of the Pastos Grandes Transaction; the Company’s ability to
obtain additional financing on satisfactory terms or at all; the
ability to develop and achieve production at any of the Company’s
mineral exploration and development properties; the impacts of
pandemics and geopolitical issues on the Company’s business; the
impact of inflationary and other conditions on the Company’s
business and global markets; and accuracy of development budget and
construction estimates. Many of these expectations, assumptions,
risk and uncertainties are beyond the Company’s control, and could
cause actual results to differ materially from those that are
disclosed in or implied by such forward-looking information.
Although the Company believes that the
assumptions and expectations reflected in such forward-looking
information are reasonable, the Company can give no assurance that
these assumptions and expectations will prove to be correct. Since
forward-looking information inherently involves risks and
uncertainties, undue reliance should not be placed on such
information. The Company’s actual results could differ materially
from those anticipated in any forward-looking information as a
result of the risk factors set out herein and, in the Company’s
latest annual information form (“AIF”), management
information circular, management discussion & analysis and
other publicly filed documents (collectively, the “Company
Public Disclosure”) all of which are available on
SEDAR+.
All forward-looking information contained in
this news release is expressly qualified by the risk factors set
out in the latest Company Public Disclosures. Such risks include,
but are not limited to the following: lithium prices; inability to
obtain required governmental permits and government-imposed
limitations on operations; technology risk; political risk
associated with foreign operations, including co-ownership
arrangements with foreign domiciled partners; risks arising from
the outbreak of hostilities in Ukraine, Israel, the Middel East and
other parts of the world and the international response, including
but not limited to their impact on commodity markets, supply
chains, equipment and construction; emerging and developing market
risks; risks associated with not having production experience;
operational risks; changes in government regulations; changes to
environmental requirements; failure to obtain or maintain necessary
licenses, permits or approvals; insurance risk; receipt and
security of mineral property titles and mineral tenure risk;
changes in project parameters as plans continue to be refined;
changes in legislation, governmental or community policy;
regulatory risks with respect to strategic minerals; mining
industry competition; market risk; volatility in global financial
conditions; uncertainties associated with estimating Mineral
Resources and Mineral Reserves, including uncertainties relating to
the assumptions underlying Mineral Resource and Mineral Reserve
estimates; risks related to unknown financial contingencies,
including litigation costs, on the Company’s operations;
unanticipated results of exploration activities; cybersecurity
risks and threats; and uncertainties with obtaining required
approvals (including regulatory approvals) for the Pastos Grandes
Transaction. Such risk factors are not exhaustive. The Company does
not undertake any obligation to update or revise any
forward-looking information, whether as a result of new
information, future events or otherwise, except as required by law.
All forward-looking information contained in this news release is
expressly qualified in its entirety by this cautionary statement.
Additional information about the above-noted assumptions, risks and
uncertainties is contained in the Company Public Disclosures, which
are available on SEDAR+ at www.sedarplus.ca.
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