Sigma Lithium(SGML) - 2024 Q3 - Quarterly Report

Financial Performance - Total sales revenue for the three months ended September 30, 2024, was CAD 28,275, a decrease from CAD 129,925 in the same period of 2023[15] - The net loss for the nine months ended September 30, 2024, was CAD 58,302, compared to a net loss of CAD 25,505 for the same period in 2023[17] - The gross profit for the nine months ended September 30, 2024, was CAD 22,373, a decrease from CAD 82,829 in the same period of 2023[15] - Net loss for the nine months ended September 30, 2024, was CAD$58,302,000, compared to a net loss of CAD$25,505,000 for the same period in 2023, representing a 128.5% increase in losses[19] - Stock-based compensation for the nine months ended September 30, 2024, was CAD$11,032,000, compared to CAD$57,076,000 in the same period of 2023, showing a decrease of 80.7%[22] Cash and Liquidity - Cash and cash equivalents increased to CAD 88,645 as of September 30, 2024, from CAD 64,403 as of December 31, 2023[13] - Cash and cash equivalents at the end of the period increased to CAD$88,645,000 from CAD$38,142,000, marking a CAD$50,503,000 increase[20] - The company reported a net income of CAD 283 thousand for the nine months ended September 30, 2024, compared to a net loss of CAD 2,221 thousand for the same period in 2023[112] - The company has a liquidity management strategy focused on ensuring sufficient cash flow to meet obligations, with a total of CAD 47,645 thousand in supplier obligations due within one year[192][196] Assets and Liabilities - Total assets rose to CAD 498,447 as of September 30, 2024, compared to CAD 487,238 as of December 31, 2023[13] - Current liabilities increased significantly to CAD 185,251 as of September 30, 2024, from CAD 122,373 as of December 31, 2023[13] - Total shareholders' equity decreased to CAD 147,892 as of September 30, 2024, from CAD 214,284 as of December 31, 2023[13] - The total loans and export prepayment as of September 30, 2024, amounted to CAD 170,906 thousand, an increase from CAD 77,438 thousand as of December 31, 2023[120] - The company’s loans and export prepayment agreements increased to CAD 244,847 thousand as of September 30, 2024, up from CAD 170,906 thousand at the end of 2023, indicating a rise in financial leverage[197] Inventory and Receivables - Trade accounts receivable decreased to CAD 20,109 from CAD 29,693, reflecting a reduction of 32.5%[66] - High-grade lithium concentrate inventory increased to CAD 2,833, up 107.1% from CAD 1,366 on December 31, 2023[73] - Total inventories rose to CAD 22,394, a 15.1% increase from CAD 19,442[73] - Advances to suppliers increased to CAD 11,323 from CAD 7,062, representing a 60.5% rise[75] Financing Activities - Proceeds from loans in financing activities amounted to CAD$223,431,000, a substantial increase from CAD$80,958,000 in the previous year[19] - Interest payments on loans and leases increased to CAD$21,103,000 in 2024 from CAD$1,683,000 in 2023, reflecting a significant rise in financing costs[19] - The facility agreement with Tatooine allows for a loan of up to USD 15.9 million, with a total amount of CAD 16,695 thousand outstanding as of September 30, 2024[109] Tax and Regulatory - The effective tax rate for the nine months ended September 30, 2024, was -3.8%, compared to 38.9% for the same period in 2023[19] - The total deferred tax assets increased to $10,973 thousand as of September 30, 2024, from $9,832 thousand on December 31, 2023[154] - The Company has $17,889 thousand of tax loss carryforward generated in Canada that has not been recognized due to the expectation of no taxable income to offset it[19] Foreign Exchange and Risk Management - The company reported a foreign exchange gain of CAD$26,845,000 in 2024, contrasting with a loss of CAD$7,403,000 in 2023, indicating a positive shift in currency impact[19] - The company’s exposure to foreign exchange rate risk includes $(6,917) thousand in Canadian dollars and $57,340 thousand in U.S. dollars as of September 30, 2024[174] - The sensitivity analysis indicated that a 10% deterioration in the CAD exchange rate could result in a profit impact of CAD 765 thousand, while a 20% deterioration could lead to a profit impact of CAD 1,278 thousand[178] Operational Investments - The company continued investing in Phase 1 infrastructure, with additions classified as assets under construction totaling CAD 22,375 for the period ended September 30, 2024[82] - The company has initiated the transfer of mining rights from Arqueana to Sigma Brazil, which is expected to enhance its operational capabilities[111]