Mining & Metals
Largo Down 9.4% As Net Loss Halved and Revenues Come In Lower For Q1
Largo (LGO.TO), down 9% on last look, said on Thursday that its net loss halved in the first quarter on "operating improvements at Maracas Menchen and a stronger production profile compared with the same period last year," even as revenues were down as a result of international tariffs.Net loss improved to US$4.73 million, or $0.07 per basic share, from a net loss of $9.2 million, or $0.14 per basic share, from the prior year period.This improvement was mainly due to a 19% decrease in operating costs, a 28% decrease in other general and administrative expenses, and a $4.7 million recovery of vanadium assets, partially offset by a 3% decrease in revenues, a 16% decrease in foreign exchange gain, and a 63% increase in finance costs, the company added.Revenue fell 2.5% to $27.5 million. Largo booked $25.8 million in vanadium sales revenue and US$1.7 million in ilmenite sales revenue during the quarter. Revenue continued to reflect the impact of the 50% U.S. import tariff on Brazilian products, which was reduced to 10% in the middle of the quarter.Among operation highlights, Vanadium pentoxide (V2O5) production in the quarter doubled to 2,616 tonnes, from 1,297 tonnes last year. Production hit the upper end of Largo's quarterly guidance of 2,400 tonnes to 2,700 tonnes. Largo continues to expect full-year 2026 V2O5 equivalent production of 10,500 tonnes to 12,000 tonnes.Largo ended the first quarter with a cash balance of $11.2 million and debt of $108.4 million.Daniel Tellechea, Co-Chief Executive Officer, said: "Q1 2026 reflected continued operating improvements at Maracas Menchen and a stronger production profile compared with the same period last year. We achieved V2O5 equivalent production at the upper end of our quarterly guidance range, supported by improved mine access, stronger ore availability, and greater operating stability at the plant. Our focus remains on disciplined execution of the mine plan, cost control, and continued operational consistency."Co-chief executive Alberto Arias added: "The operating results of Q1 2026 reflect a stronger operating base for Largo, but sales were still affected by the impact of the high U.S. tariffs on Brazilian imports in the earlier part of the quarter. We are actively working to translate this improved production into higher sales, supported by recent positive trends in the vanadium market. The reduction of U.S. tariffs on Brazilian products in February has improved Largo's ability to more actively supply the high-purity market, particularly the aerospace sector, as well as the U.S. ferrovanadium market. Due to the timing of our sales contracts, the benefits of these developments should begin to be reflected in Q2 2026. While the U.S. ferrovanadium market has recently shown signs of rebalancing, we believe Largo remains well positioned to serve these markets as commercial conditions normalize."Largo shares were last seen down $0.145, to $1.395, on the Toronto Stock Exchange.Price: $1.40, Change: $-0.15, Percent Change: -9.42%
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