Lithium Americas (Argentina) Corp. (“
Lithium
Argentina,” the “
Company,” or
“
LAAC”) (
TSX: LAAC)
(
NYSE: LAAC), formerly Lithium Americas Corp.
(“
Lithium Americas” or “
LAC”),
today announced fourth quarter and full year 2023 results, as well
as its 2024 outlook.
Highlights
- On March 18,
2024, Sam Pigott commenced as President and CEO of the Company.
John Kanellitsas will remain Executive Chairman of the
Company.
- On March 19,
2024, Sam Pigott and Monica Moretto were appointed to the Board of
Directors.
- On March 5,
2024, Ganfeng Lithium Co. Ltd. (“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”).
- Ganfeng, with support of Lithium
Argentina, will undertake preparation of a regional development
plan for the Pastos Grandes basin and surrounding properties,
expected to be finalized by the end of 2024.
- The transaction is expected to
close in Q2 2024 with proceeds available to support the Company’s
Argentine operations.
- Operational Highlights
- Production commenced in June 2023
at Caucharí-Olaroz, the largest new greenfield lithium brine
project.
- In 2023, approximately 6,000 tonnes
of lithium carbonate were produced, achieving 99.5% lithium
carbonate content and technical-quality specifications.
- Caucharí-Olaroz is producing at
approximately 50% of the 40,000 tonnes per annum
(“tpa”) capacity.
- The operation is targeting to reach
nameplate capacity on a limited basis by mid-2024 and maintain a
level near capacity on a steady state basis by the end of the
year.
- 2024 targeted production at
Caucharí-Olaroz of 20,000 – 25,000 tonnes of lithium
carbonate.
- In the current price environment,
the project is expected to generate positive cash flow from
operations in 2024.
- While planning for Stage 2
expansion in production capacity continues to advance, the Company
has not committed material capital to growth capex at this
time.
- Financial Highlights
- As of December 31, 2023, the
Company had $122M in cash and cash equivalents.
- The Company has $259M in
convertible debt at 1.75% due in early 2027 and has not drawn on
its $75M credit facility with Ganfeng.
- As of December 31, 2023, Minera
Exar S.A., the Argentine joint venture company owned by the Company
(44.8%), Ganfeng (46.7%) and Jujuy Energia y Mineria Sociedad del
Estado (8.5%) had approximately $234M (on a 100% basis, less cash
collateral) of local debt tied to funding working capital and
startup costs.
- The Company and Ganfeng are in the
process of finalizing new credit facilities to refinance a
substantial portion of this local debt with longer maturity credit
facilities typical of an operating business.
- Cognizant of market conditions in
the lithium market, the Company has commenced proactive measures to
reduce discretionary exploration and evaluation and general and
administrative spending at the corporate level by 25%.
Commenting on the results for the twelve-month
period ended December 31, 2023, John Kanellitsas, Executive
Chairman, Lithium Argentina commented:
“Last year was a milestone year for Lithium
Argentina, with the commencement of operations at the
Caucharí-Olaroz site in Argentina. This achievement was the
culmination of years of hard work, dedication and determination,
and an over $ 1 billion investment into Northern Argentina. I am
proud of the cross-cultural team that came together to diligently
progress Caucharí-Olaroz, making it the success it is today.
Additionally, last year Lithium Argentina closed on the acquisition
of our majority stake in the Sal de la Puna project and completed
the spin-off of our North American assets. I am confident that the
great work that has been done to date, will be the foundation for
great achievements for the Company in the future”.
Mr. Kanellitsas closed by saying, “I am honored
to welcome Sam Pigott as President and CEO, his 20 plus-years of
experience in mining, finance and business development will be
invaluable to the Company and I look forward to working with him in
my continued role as Executive Chairman”.
Sam Pigott, CEO of Lithium Argentina,
commented:
“Following the accomplishments of Lithium
Argentina, I am eager to work with this experienced team and Board
to take the Company to the next level and maximize value for all
shareholders. As I look to the coming year, the priority is
completing the ramp up of Stage 1 of Caucharí-Olaroz and
transitioning from development to operations. The project is well
on its way to completing commissioning and is currently producing
at approximately 50% capacity, making it already among the largest
operations in Argentina. The operation is targeting to reach
nameplate capacity on a limited basis by mid-2024 and maintain a
level near capacity on steady state basis by the end of the year.
The Company looks forward to advancing its role in providing such a
critical input to the electric vehicle industry. While, the
commissioning of the project has been going very well, we will
remain cognizant of the market environment and will make thoughtful
decisions to ensure that shareholder value is protected.”
“The recent agreement to prepare a regional
development plan together with Ganfeng for their Pozuelos Pastos
Grandes project and Lithium Argentina’s Pastos Grandes and Sal de
la Puna projects is a potentially lucrative opportunity to organize
the development of these assets in a logical way while maintaining
optionality for offtake. The Company’s strong balance sheet coupled
with the high quality and low-cost nature of its brine assets in
Argentina, will position it better to navigate the cyclical nature
of the lithium market today and in the future.”
INVESTOR WEBCAST
AN INVESTOR WEBCAST HAS BEEN SCHEDULED FOR
10:00am ET ON THURSDAY, MARCH 21, 2024.
Please use the following link to access:
2023 Results Webcast
SELECTED ANNUAL FINANCIAL
INFORMATION
The following table provides a summary of the
Company’s financial operations for the years ended December 31,
2023 (“FY 2023”), December 31, 2022 (“FY
2022”), and December 31, 2021 (“FY
2021”).
For more detailed information, refer to the
audited consolidated financial statements for FY 2023, FY 2022, and
FY 2021 which can be found on SEDAR+.
|
Years Ended December 31, |
|
(in US$
thousands) |
2023 |
|
2022 |
|
2021 |
|
|
$ |
|
$ |
|
$ |
|
Expenses of continuing operations |
|
(36,346 |
) |
|
(105,309 |
) |
|
(1,806 |
) |
Income/(loss) from continuing
operations after taxes |
|
17,581 |
|
|
(32,527 |
) |
|
6,027 |
|
Income/(loss) from
discontinued operations |
|
1,270,788 |
|
|
(61,041 |
) |
|
(44,515 |
) |
Net income/(loss) |
|
1,288,369 |
|
|
(93,568 |
) |
|
(38,488 |
) |
Net income/(loss) per share -
basic |
|
8.29 |
|
|
(0.70 |
) |
|
(0.32 |
) |
Net income/(loss) per share -
diluted |
|
8.02 |
|
|
(0.70 |
) |
|
(0.32 |
) |
Cash and cash equivalents and
short-term bank deposits |
|
122,293 |
|
|
352,102 |
|
|
510,607 |
|
Total assets |
|
1,055,026 |
|
|
1,016,548 |
|
|
817,342 |
|
Total long-term
liabilities |
|
(211,516 |
) |
|
(212,901 |
) |
|
(272,771 |
) |
|
|
|
|
|
|
|
|
|
|
The Separation was accounted for as a
distribution of assets to shareholders pursuant to IFRIC 17,
Distribution of Assets to Owners, whereby a dividend was recognized
in deficit measured at the fair value of the net assets distributed
with a corresponding dividend payable. The dividend payable was
then settled through the distribution of the net assets. In
accordance with IFRS 5, Non-Current Assets Held for Sales and
Discontinued Operations, the operations of Lithium Americas (NewCo)
have been classified as discontinued operations for the years ended
December 31, 2023, December 31, 2022, and December 31, 2021.
Expenses of continuing operations decreased from
2022 to 2023, primarily due to share of gain of the Caucharí-Olaroz
project versus loss in the comparative period mainly as a result of
foreign exchange revaluation of intercompany loans; offset by an
increase in exploration and evaluation expenditures as result of
the timing of the Pastos Grandes project development activities and
general and administrative expenses due to an increase in salaries,
professional fees and office and administration expenses.
In 2023, total assets increased primarily due to
the acquisition of Arena Minerals Inc., loans advanced to Exar
Capital, offset by the distribution of assets to the shareholders
upon the Separation. Total long-term liabilities decreased due to a
decrease in the fair value of the Convertible Notes derivative
liability, offset by accrued interest on the Convertible Notes, the
recognition of a deferred income tax liability due to the weakening
of the Argentine Pesos against the US dollar and the distribution
of liabilities to the shareholders upon the Separation.
This news release should be read in conjunction
with Lithium Argentina’s audited consolidated financial statements
and the notes thereto for the year ended December 31, 2023 and
management's discussion and analysis for year ended December 31,
2023, 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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