Lithium Americas EPS beats by $0.01
Aug. 14, 2020 7:35 AM ET|About: Lithium Americas Corp. (LAC)|By: Gaurav Batavia, SA News Editor
Lithium Americas (NYSE:LAC): Q2 GAAP EPS of -$0.07 beats by $0.01.
Lithium Americas Reports Second Quarter 2020 Results
Fri August 14, 2020 7:29 AM|GlobeNewswire|About: LAC
Q2: 08-14-20 Earnings Summary
EPS of $-0.06997827792192119713 beats by $0.01 Revenue of $0M (-100.00% Y/Y)
VANCOUVER, British Columbia, Aug. 14, 2020 (GLOBE NEWSWIRE) -- Lithium Americas Corp. (LAC) (NYSE: LAC) ("Lithium Americas" or the "Company") has reported financial and operating results for the second quarter ended June 30, 2020.
This news release should be read in conjunction with Lithium Americas’ unaudited condensed consolidated interim financial statements and management's discussion and analysis (“MD&A”) for the six months ended June 30, 2020, which are available on the Company’s website and SEDAR. All amounts are in U.S. dollars unless otherwise indicated.
“We remain focused on protecting our workers and communities, while coordinating closely with the Province of Jujuy to ensure we operate responsibly and safely as we begin to restart construction activities over the next few weeks,” said Jon Evans, President and CEO of Lithium Americas. “I would like to personally thank all of our workers in Argentina for their commitment and recognize the significant contribution they continue to make to the success of the project for the benefit of all stakeholders."
“With respect to the Thacker Pass lithium project in Nevada, we continue to make significant progress with the recent release of the draft Environmental Impact Statement by the Bureau of Land Management.”
Highlights
Caucharí-Olaroz Lithium Project (“Caucharí-Olaroz”):
As of June 30, 2020, the project was 47% complete with $427 million (75%) of the planned capital expenditures committed including $304 million (54%) spent.
In mid-April 2020, following modifications to the government’s COVID-19 related restrictions, construction activities at Caucharí-Olaroz gradually resumed on a limited basis with comprehensive health and safety protocols.
Significant progress was made on the liming plant, SX plant, civil construction and solar evaporation ponds.
Critical equipment, including the fabrication of equipment in China for the lithium carbonate plant, remain on track for delivery in the second half of 2020.
Subsequent to the end of Q2 2020, to protect the health and safety of our employees and contractors, and support the Province of Jujuy efforts to limit transmission of COVID-19, we temporarily suspended construction activities after workers tested positive for COVID-19. All workers remain in good condition and substantially all workers who tested positive have since recovered and have been released from isolation.
The Company is coordinating closely with the Province of Jujuy, local communities, unions and its workforce on the safe restart of operations and the implementation of additional COVID-19 health and safety protocols.
Remobilization is expected to begin in the coming weeks and will be gradual in order to allow time to adopt as well as progressively assess and refine the pandemic related operating protocols.
The Company is continuing to review the impacts of the temporary suspension of the project on the timeline and budget and will provide an update once the assessments have been completed.
Thacker Pass Lithium Project (“Thacker Pass”):
Permitting continues as planned with the draft Environmental Impact Statement released by the Bureau of Land Management for public comment on July 29, 2020.
The process testing facility in Reno, Nevada has resumed full operations with appropriate COVID-19 protocols in place.
Over 15,000 kg of high-quality lithium sulphate has been produced at the process testing facility.
Third-party vendors continue to engineer and design the lithium carbonate and lithium hydroxide evaporator and crystallizer as well as provide performance guarantees and product samples.
The Company’s technical team and consultants continue to advance work on the definitive feasibility study with results expected in Q4 2020.
The Company continues to explore financing options for Thacker Pass’ construction, including the possibility of a joint venture partner.
Corporate:
At June 30, 2020, the Company had $50 million in cash and cash equivalents, including $12 million representing the Company’s 50% share of Caucharí-Olaroz cash and cash equivalents, a $20 million drawdown on one of the credit facilities during the six months ended June 30, 2020 to fund Caucharí-Olaroz and $17 million held by Lithium Americas and its subsidiaries.
At June 30, 2020, the Company had $187 million in undrawn credit. The Company has drawn $96 million of the $205 million senior credit facility and $22 million from its $100 million unsecured, limited recourse, subordinated loan facility.
On June 9, 2020, Ganfeng Lithium Co Ltd. (“Ganfeng Lithium”) received regulatory approval from the National Development and Reform Commission of the People’s Republic of China in respect to the transaction announced on February 7, 2020 (the “Transaction”). The Transaction remains on track to close by the end of Q3 2020 subject to remaining closing conditions.
Financial Results
Selected consolidated financial information is presented as follows:
(in US$ million except per share information) Three months ended
June 30, 2020 Three months ended
June 30, 2019
$ $
Expenses (6.5) (4.9)
Net loss (6.0) (6.7)
Loss per share - basic (0.07) (0.07)
(in US$ million) As at June 30, 2020 As at December 31, 2019
$ $
Cash and cash equivalents 49.7 83.6
Total assets 319.6 293.8
Total long-term liabilities (161.4) (119.2)
During the six months ended June 30, 2020, total assets increased primarily due to capital expenditure at Caucharí-Olaroz, partially offset with expenses in the period. Cash decreased mainly due to capital expenditures on Caucharí-Olaroz and operating activities, including exploration expenditures on Thacker Pass. Total long-term liabilities increased primarily as a result of a $22.2 million drawdown on the Company’s limited recourse loan facility and a $12.0 million drawdown on the Company’s senior credit facility.
Net loss for the three months ended June 30, 2020 was $6.0 million compared to net loss of $6.7 million for the three months June 30, 2019. Net loss in Q2 2020 decreased primarily as a result of lower equity compensation and administrative expenses, higher foreign exchange gain and capitalization of finance costs in the period, partially offset with the higher engineering costs on Thacker Pass and other items.
