Largo Inc.

Good day, and thank you for standing by. Welcome to Largo's first quarter 2022 webcast and conference call. At this time, I'll participate in the earning listen-only mode. After this speaker's presentation, there will be a question and answer session. I would now like to hand the conference over to your speaker today, Alex Guthrie, Senior Manager of External Relations. Please go ahead, sir.

Good morning, everyone, and thanks for joining our first quarter earnings conference call. On the call today is Paula Misk, our President and CEO, Ernest Cleave, our CFO, and Paul Vallant, our VP of Commercial, and Stephen Prince, the President of our Clean Energy Division. To accompany the call today, we've uploaded a supplemental webcast presentation, which is also available at our website at LargoInc.com. Our Q&A and financial statements related to MD&A and most recent AIF are also available on the website, on CDAR, and on NICOR. Before continuing the call today, I would like to remind you that some of the information you'll hear during today's call will consist of forward-looking statements, including, without limitation, those regarding future business outlook. In addition, non-GAAP financial measures and ratios such as cash operating costs, cash operating costs excluding royalties per pound, and revenues per pound sold will also be discussed during this conference call. These have no standard meaning under IFRS and may not be comparable to similar financial measures disclosed by other issuers. Actual results discussed during today's call could differ material from those anticipated and risk factors that could affect results are detailed in the company's latest AIF and other public filings, which are also available on CDAR, EDGAR, and on the company's website. Further information regarding the largest use of non-GAAP measures and ratios are also available in our most recent earnings press release and the company's latest MD&A, which are all available on our website, CDAR, and EDGAR. Lastly, market and industry data contained and incorporated by reference during this call concerning economic and industry trends is based upon good faith estimates of our management or derived from information provided by industry sources. We believe that such market and industry data is accurate and the sources from which it has been obtained are reliable. However, we cannot guarantee the accuracy of such information and we have not independently verified the assumptions upon which projections of future trends are based. The agenda for our call this morning is as follows. Paul will provide an update on the company's first quarter progress. Ernest will follow with an overview of our Q1 financial results. Paul will provide an update on the company's sales and trading, the Vanadium market, and on Largo Physical Vanadium. And Stephen will close with a progress update from our Clean Energy Division. Finally, we'll then open the call for questions. We kindly ask that you restrict your questions to two and then re-queue if you have any additional questions to allow the others the opportunity to participate. And with that, I'll hand it over to Paulo.

Thank you, Alex. And good morning to everyone who has been able to join us on the call and online. we'd like to continue to structure our earnings call to focus our two-pillar business strategy as it relates to our first quarter progress. It's important to note that we strongly believe significant value creation exists within our core and profitable Venetian business with substantial upside opportunities to add new products to all portfolios, and our emerging clean energy business. Before we jump in, there are really four key points to take away from this call. Firstly, we've had to make adjustments on our full year 2022 guidance upon factoring in the weaker first quarter, as well as continued global inflationary pressures. and the strengthening of the Brazilian real against the US dollar. However, we are confident in our ability to reach these update targets and are very focused on making additional improvements on its sales and production rates going forward. Our updated annual cash operating costs, excluding RIO's guidance, is now in the range of $3.90 to $4.30 per pound sold. Unfortunately, the inflationary environment is here, and it's something we are focused on mitigating the effects of the deaths of our ability. Our V205 equivalent production guidance is now 11,600 to 12,400 tons, and our total V205 equivalent sales guidance is now 11,000 to 12,000 tons. which includes sales of up to 1,000 tons of purchased products, eventually in order to face any logistic problems. On our positive note, despite navigating unprecedented global supply chains and logistical constraints, our sales team continued to perform well under these circumstances in the first quarter, and in April sold approximately 1,250 tons of E2O5 equivalents. As we noted in the press release issue yesterday evening, we expect to perform a catch-up in the sales during the second half of the year, following the improvements of logistics and supply chain constraints. Secondly, we continue to expect a bullish Canadian market for the remainder of the year, which we are focused capitalizing on, particularly as we remain a relatively low-cost producer in the commodity. Bo will provide a more detailed overview of what's happening in the market, but as we have alluded in our previous call, the elevated price environment is quite adventurous for us, especially as we increase sales of our produced products in the second half of the year. Ernest will provide an updated forecast for the year ahead later in the call as well. But I am encouraged to say that we will end the year on a positive note. I also would like to highlight that after attending the annual Vanitech Venetian Produce Association Conference last month, I am energized by the digital Venetian demand that is expected from VRTBs going forward. our emerging clean energy business as a significant source of future value for the company and very excited by its potential given the adventures of Largo Fisico Veneto, or LTV, something Paul will touch on a bit later. Thirdly, with the notable progress we've made on the strategic value-added project the company has undertaken, namely the commencement of phase one of our titanium project and certain advancements made to LTE. In April, we began construction of the company's humanized concentration plant as part of our previous announced titanium project. This is a very exciting moment for the company as we begin to execute on this project and reap its future benefits. It's important to understand that the I2 content will be sourced from the existing Vanadium or created from the company's ongoing operation in Brazil. It doesn't require any new efforts on the mining side. We believe this project will be quite aggressive for the company and will contribute to the company's two-fielder business strategy as a low-cost Vanadium supplier, with an emerging Canadian battery business. On LPZ, we announced an updated and previously announced proposed qualifying transaction.