Largo Inc (LGO) 2018 Q4 法說會逐字稿

Good morning. My name is Joanna, and I'll be your conference operator today. At this time, I would like to welcome everyone to the Largo Resources Fourth Quarter and Full Year 2018 Financial Results Conference Call and Webcast. (Operator Instructions) Thank you. Mr. Guthrie, you may begin your conference.

早安.我叫喬安娜，今天我將擔任你們的會議接線生。在此，我謹代表 Largo Resources 公司歡迎各位參加 2018 年第四季及全年財務業績電話會議及網路直播。（操作說明）謝謝。格思裡先生，您可以開始您的會議了。

Thank you, operator, and welcome, everyone, to the Largo Resources Fourth Quarter and Full Year 2018 Earnings Conference Call. Today's call is being recorded, and a replay will be available starting tomorrow in the Investors section on our website at largoresources.com.

謝謝接線員，歡迎各位參加 Largo Resources 2018 年第四季及全年財報電話會議。今天的電話會議正在錄音，從明天開始，您可以在我們網站 largoresources.com 的投資者關係版塊收聽回放。

Our fourth quarter and full year 2018 results press release, MD&A and fiscal 2018 financial statements are also available on the company's website and on SEDAR. Some of the information you'll hear during today's discussion will consist of forward-looking statements, including without limitation those regarding future business outlook. In addition, non-IFRS financial measures such as cash operating costs and cash operating costs excluding royalties will also be discussed during this conference call. Actual results could differ materially from those anticipated and risk factors that could affect results are detailed in the company's annual information form and other public filings, which are available on SEDAR and the company's website.

公司網站和 SEDAR 上也提供了我們 2018 年第四季和全年業績新聞稿、管理層討論與分析以及 2018 財年財務報表。在今天的討論中，您將聽到一些前瞻性陳述，包括但不限於有關未來業務前景的陳述。此外，本次電話會議還將討論非 IFRS 財務指標，例如現金營運成本和不包括特許權使用費的現金營運成本。實際結果可能與預期結果有重大差異，可能影響結果的風險因素已在公司年度資訊表和其他公開文件中詳細說明，這些文件可在 SEDAR 和公司網站上查閱。

Further information regarding Largo's use of non-IFRS measures are available in Largo's fourth quarter and full year 2018 earnings press release and in the company's MD&A for the year ended December 31, 2018, which are also available on SEDAR and on our website.

有關 Largo 使用非 IFRS 指標的更多信息，請參閱 Largo 2018 年第四季度和全年收益新聞稿以及公司截至 2018 年 12 月 31 日的年度管理層討論與分析 (MD&A)，這些文件也可在 SEDAR 和我們的網站上查閱。

Financial amounts presented today will be in Canadian dollars, except as otherwise noted. Speaking first today will be Largo's Chief Executive Officer, Mark Smith; Largo's CFO, Ernest Cleave will then provide additional detail on Largo's Q4 and 2018 annual financial performance. Finally, we'll open the call to questions.

除另有說明外，今天列示的財務金額均以加幣為單位。今天首先發言的是 Largo 的執行長 Mark Smith；隨後 Largo 的財務長 Ernest Cleave 將詳細介紹 Largo 第四季和 2018 年全年的財務表現。最後，我們將開放提問環節。

I will now turn the call over to Mark Smith for opening remarks.

現在我將把電話交給馬克史密斯，請他致開幕詞。

Thanks, Alex, and welcome, everyone. Please, I apologize upfront for my voice, I do have a slight case of laryngitis, but I think I can get through this call and questions, and as always feel free to contact Ernest or I at your convenience afterwards.

謝謝Alex，也歡迎各位。首先，我為我的聲音道歉，我有點喉炎，但我認為我可以完成這通通話和回答問題。和往常一樣，之後您可以隨時聯繫我或歐內斯特。

2018 was an outstanding year for Largo and the results largely speak for themselves. Net income for the year was $316 million, with basic earnings per share of $0.61. That was the strongest annual earnings performance since operations commenced in 2014. We also set new annual and quarterly production records in 2018. And Largo remains one of the world's lowest-cost producers of standard and high purity vanadium and this operational profile positions us to continue generating significant cash across a range of vanadium pricing environments.

2018 年對 Largo 來說是傑出的一年，成績足以說明一切。該年度淨收入為 3.16 億美元，每股基本收益為 0.61 美元。這是自 2014 年開始營運以來最強勁的年度獲利表現。2018年，我們也創下了新的年度和季度生產記錄。Largo 仍然是世界上成本最低的標準和高純度釩生產商之一，這種營運模式使我們能夠在各種釩價格環境下繼續產生可觀的現金流。

Our financial position also remains strong. We entered 2019 with a cash balance of $206.2 million and the company currently has only approximately USD 29.1 million of outstanding debt remaining. As our shareholders know, debt repayment has been a top priority for the company. Over the past 10 months, Largo has repaid approximately USD 120.9 million of debt represented by our senior secured notes due in 2021. We intend to eliminate the remaining USD 29.1 million in debt before the end of the second quarter of this year.

我們的財務狀況依然穩健。2019 年開始，公司現金餘額為 2.062 億美元，目前公司僅剩約 2,910 萬美元未償債務。正如我們的股東所知，償還債務一直是公司的首要任務。在過去的 10 個月裡，Largo 償還了約 1.209 億美元的債務，這些債務由我們 2021 年到期的優先擔保票據代表。我們計劃在今年第二季末之前償清剩餘的 2,910 萬美元債務。

We look forward to expanding production in 2019 into a supply constrained market as both the low cost and debt-free producer of this critical and strategic material. On the operational front, I'm pleased to report 2018 production of 9,830 tonnes of V2O5 from the Maracás Menchen Mine. That set a new annual production record for the company and was a 6% improvement over 2017. Moreover, Q4 production -- Q4 2018 production of 2,595 tonnes of V2O5 was also a new record, and we represented the fourth consecutive quarter of production growth at the mine.

我們期待在 2019 年擴大生產規模，進入供應受限的市場，成為這種關鍵策略材料的低成本、無債務生產商。在營運方面，我很高興地報告，2018 年 Maracás Menchen 礦場的 V2O5 產量為 9,830 噸。這為該公司創下了新的年度生產記錄，比 2017 年提高了 6%。此外，2018 年第四季 V2O5 產量為 2,595 噸，也創下了新紀錄，並且實現了該礦連續第四個季度的產量增長。

Global V2O5 recovery rates averaged 77% in 2018, which is an increase of 1.7% over the prior year. Under Paulo Misk's steady hand at the mine, our production teams are really hitting their stride and are focused on increasing both recovery rates and production output. With regard to high purity V2O5 sales in 2018, they were 1,440 tonnes, which compares to sales of 200 tonnes in 2017. That's a 620% increase. The company remains focused on developing premium vanadium products, and I'm pleased to report that we successfully commissioned new high purity powder screening and packing automated systems in the fourth quarter of 2018.

2018 年全球 V2O5 回收率平均為 77%，比前一年增長了 1.7%。在 Paulo Misk 對礦場的穩健領導下，我們的生產團隊真正步入正軌，並專注於提高回收率和產量。2018 年高純度 V2O5 的銷量為 1440 噸，而 2017 年的銷量為 200 噸。這相當於成長了620%。公司仍專注於開發優質釩產品，我很高興地報告，我們在 2018 年第四季度成功投產了新的高純度粉末篩選和包裝自動化系統。

As many of you know, high purity V2O5 is a high-margin material used in high-performance alloys for jet engines and other aerospace applications as well as in chemical catalysts and vanadium redox flow batteries. It commands a price premium over standard grades of V2O5, and its production requires no additional operational costs for Largo because of our naturally high ore grade and excellent metallurgy.

正如你們許多人所知，高純度 V2O5 是一種高利潤材料，用於噴射發動機和其他航空航天應用的高性能合金，以及化學催化劑和釩液流電池。由於我們天然礦石品位高、冶金技術優良，其生產無需 Largo 承擔額外的營運成本，因此其價格高於標準等級的 V2O5。

I'm also pleased to report the kiln refractory -- replacement project is progressing as planned, even better than planned. At the end of February, the company had AMV stock and work in process inventory of 326 tonnes, which is helping to mitigate the impact of the kiln's replacement project. As a result of this inventory, the company had gained 4 days of production from initial estimates. Because of this replacement operation and the corresponding lower production the company expects, the cash operating cost for Q1 2019 will exceed the company's guidance for 2019, but our overall yearly projection has not changed.

我很高興地報告，窯爐耐火材料的更換項目正在按計劃進行，甚至比計劃的還要好。截至 2 月底，該公司擁有 326 噸 AMV 庫存和在製品庫存，這有助於減輕窯爐更換專案的影響。由於此次庫存盤點，該公司比最初預估的生產時間節省了 4 天。由於此次更換操作以及公司預計相應的產量下降，2019 年第一季的現金營運成本將超過該公司 2019 年的預期，但我們的年度整體預測並未改變。

Our expansion project to ramp up production to 1,000 tonnes of V2O5 per month is progressing well. We expect the expansion ramp up to be completed during the third quarter of 2019 and to reach an increased nameplate production rate of 1,000 tonnes of V2O5 per month at the beginning of Q4 2019. As a result of additional equipment specification changes, designed to maximize operational reliability, the company anticipates that its total expansion capital expenditures for this expansion project will be in the range of USD 18 million to USD 21 million. That is an increase from the approximately USD 15.5 million forecasted last year.

我們旨在將 V2O5 的月產量提高到 1000 噸的擴建項目進展順利。我們預計擴建工程將於 2019 年第三季完成，並於 2019 年第四季初達到每月 1,000 噸 V2O5 的額定產量。由於對設備規格進行了額外更改，旨在最大限度地提高運行可靠性，該公司預計該擴建項目的總擴建資本支出將在 1800 萬美元至 2100 萬美元之間。這比去年預測的約 1550 萬美元有所增加。

As we outlined in December, our 2019 production guidance for V2O5 production is in the range of 10,000 and 11,000 tonnes, including high purity vanadium flake and high purity vanadium powder. Our average cash operating cost guidance for the year, excluding royalties is in the range of USD 3.45 to USD 3.65 per pound V2O5.

正如我們在 12 月所概述的那樣，我們 2019 年 V2O5 的產量指導範圍為 10,000 至 11,000 噸，其中包括高純度釩片和高純度釩粉。我們預計本年度平均現金營運成本（不含特許權使用費）為每磅 V2O5 3.45 美元至 3.65 美元。

On the exploration front, the company's ongoing 25,000-meter exploration program for 2019 is progressing well, and we look forward to providing an update to the market in early Q2 2019. On December 19, 2018, the company announced that it had significantly extended vanadium mineralization at the Novo Amparo Norte or NAN deposit by 130% to 1.84 kilometers in strike length. In January, we initiated this year's exploration program with 4 drill rigs, following up on the results that NAN received in December. To date, the company has completed an additional 47 diamond drill holes, totaling 5,400 meters of drilling. This exploration was primarily focused on increasing the confidence of the resource category within the deposit.

在勘探方面，該公司正在進行的 2019 年 25,000 公尺勘探計畫進展順利，我們期待在 2019 年第二季初向市場提供最新進展。2018 年 12 月 19 日，該公司宣布，Novo Amparo Norte 或 NAN 礦床的釩礦化帶已顯著延長 130%，走向長度達到 1.84 公里。今年一月，我們啟動了今年的勘探計劃，投入了 4 台鑽孔機，以跟進 NAN 在十二月份收到的結果。截至目前，該公司已完成 47 個鑽石鑽孔，總鑽探深度達 5,400 公尺。此次勘探主要集中在提高對礦床內資源類別的信心。

Drilling has also begun on the Novo Amparo target, which is located 2.8 kilometers south of and a long strike from our NAN resource. Our aim there is to increase the size and confidence level of the current inferred resource. Full analytical results are expected soon at which point the company will begin work on a new resource estimate.

Novo Amparo 目標的鑽探工作也已經開始，該目標位於我們 NAN 資源以南 2.8 公里處，與 NAN 資源走向相距很遠。我們的目標是提高目前推斷資源的規模和置信度。預計很快將公佈完整的分析結果，屆時公司將開始進行新的資源估算工作。

In summary, I'm extremely pleased with the company's record, operational and financial performance in 2018. Long-term vanadium market fundamentals continue to be favorable and Largo is very well positioned to take advantage of these fundamentals as we progress toward increasing output in order to meet rising global demand of vanadium. We look forward to continuing the success to serving vanadium customers around the world and to continuing to grow shareholder value for our owners.

總而言之，我對公司 2018 年的業績、營運和財務表現都非常滿意。釩市場的長期基本面依然有利，隨著我們逐步提高產量以滿足全球不斷增長的釩需求，Largo 已做好充分準備，利用這些基本面優勢。我們期待繼續取得成功，為世界各地的釩客戶提供服務，並繼續為我們的股東創造更大的價值。

With that, let me turn the call over to Ernest who will provide details on our fourth quarter and full year 2018 financial performance. Ernest?

接下來，我將把電話交給歐內斯特，他將詳細介紹我們 2018 年第四季和全年的財務表現。厄內斯特？

Thanks, Mark, and thanks to everybody for joining the call today. Largo delivered extremely robust financial performance in 2018. Net income after tax was $316 million or $0.61 per share and represents the strongest year of net income in the company's history. For Q4 2018, net income was $108 million compared to a net loss of $0.3 million for the same period of 2017.

謝謝馬克，也謝謝今天參加電話會議的各位。Largo在2018年取得了非常強勁的財務表現。稅後淨利為 3.16 億美元，即每股 0.61 美元，是該公司歷史上淨利潤最高的一年。2018 年第四季淨收入為 1.08 億美元，而 2017 年同期淨虧損為 30 萬美元。

Revenues recognized in 2018 of $521.4 million set an annual record when compared to $167.7 million recognized in 2017. This constitutes a 211% increase over 2017 and is, in turn, the highest recorded revenue by the company for an annual period to date. Revenues for the fourth quarter 2018 set a new quarterly record of $177.5 million, which compares to $49 million for the same period of 2017, representing a 262% increase.

2018 年確認的收入為 5.214 億美元，創下年度紀錄，而 2017 年確認的收入為 1.677 億美元。這比 2017 年成長了 211%，也是該公司迄今為止年度收入的最高紀錄。2018 年第四季營收創下 1.775 億美元的新季紀錄，而 2017 年同期為 4,900 萬美元，成長了 262%。

The significant increase in revenues over 2017 is primarily attributable to an increase in V2O5 prices and record production achieved in 2018. The average price per pound of V2O5 was approximately USD 18.30 for 2018 compared to approximately USD 6.52 for 2017.

2017 年營收的大幅成長主要歸功於 V2O5 價格的上漲以及 2018 年創紀錄的產量。2018 年 V2O5 的平均價格約為每磅 18.30 美元，而 2017 年約為每磅 6.52 美元。

Cash provided before noncash working capital items was $403.2 million in 2018 representing an increase of $336.1 million over 2017. Cash provided before noncash working capital items in the fourth quarter was $134.4 million compared to $21.5 million in the fourth quarter 2017.

2018 年，扣除非現金營運資本項目前的現金為 4.032 億美元，比 2017 年增加了 3.361 億美元。第四季未計入非現金營運資本項目的現金流量為 1.344 億美元，而 2017 年第四季為 2,150 萬美元。

Net cash provided by operating activities was $352.1 million in 2018, which represents a significant increase of $293.5 million over the prior period. Net cash provided by operating activities in the fourth quarter 2018 was $144.2 million compared to $38.5 million in Q4 2017.

2018 年經營活動產生的淨現金為 3.521 億美元，比去年同期大幅成長 2.935 億美元。2018 年第四季經營活動產生的淨現金為 1.442 億美元，而 2017 年第四季為 3,850 萬美元。

As Mark noted exiting the year, the company's cash balance was $206.2 million. Operating cost for the year were $135.7 million compared to $120.4 million in 2017. For Q4, operating costs were $37.6 million, which compares to $30.7 million in the same prior year period. Operating costs were higher in both Q4 2018 and fiscal 2019, primarily as the result of higher royalties paid.

正如馬克在年底指出的那樣，該公司的現金餘額為 2.062 億美元。本年度營運成本為 1.357 億美元，而 2017 年為 1.204 億美元。第四季營運成本為 3,760 萬美元，而上年同期為 3,070 萬美元。2018 年第四季和 2019 財年的營運成本均較高，主要原因是支付的特許權使用費較高。

Direct mine and mill cost for the year were $82 million compared to $80.4 million in 2017. Direct mine and mill cost for the quarter were $21.3 million as compared to $19.5 million in Q4 2017.

本年度的直接礦場和選礦成本為 8,200 萬美元，而 2017 年為 8,040 萬美元。本季直接礦山和選礦成本為 2,130 萬美元，而 2017 年第四季為 1,950 萬美元。

Cash operating costs in 2018 were CAD 5.45 per pound compared to CAD 4.72 in 2017. And cash operating costs, excluding royalties in 2018 were CAD 4.41 per pound compared to CAD 4.40. In U.S. dollars, cash operating costs were $4.19 per pound in 2018 is just outside the company's guidance of $4.15 per pound.

2018 年現金營運成本為每磅 5.45 加元，而 2017 年為每磅 4.72 加元。2018 年的現金營運成本（不含特許權使用費）為每磅 4.41 加元，而 2018 年為每磅 4.40 加幣。以美元計算，2018 年現金營運成本為每磅 4.19 美元，略高於公司先前預期的每磅 4.15 美元。

In Q4 2018, cash operating costs were CAD 6.16 per pound compared to CAD 4.53 per pound for Q4 2017. Cash operating costs, excluding royalties, were $4.60 per pound compared to $4.14 per pound for Q4. If you look at the press release, you can see that the cash operating costs per pound on a U.S. dollar basis approximately USD 3.26 and USD 3.38, respectively.

2018 年第四季度，現金營運成本為每磅 6.16 加元，而 2017 年第四季為每磅 4.53 加元。不包括特許權使用費的現金營運成本為每磅 4.60 美元，而第四季為每磅 4.14 美元。從新聞稿中可以看出，以美元計價，每英鎊的現金營運成本分別約為 3.26 美元和 3.38 美元。

The increase seen in Q4 2018 when compared to Q4 2017 is largely due to significantly higher HFO prices and the loss of the Reintegra tax credit. Expenditures of $20.5 million were capitalized to mine properties, the plant and equipment during 2018, including $9.8 million of capitalized waste stripping cost.

2018 年第四季與 2017 年第四季相比的成長主要是由於重油價格大幅上漲以及 Reintegra 稅收抵免的取消。2018 年，礦山資產、工廠和設備的支出資本化為 2,050 萬美元，其中包括資本化的廢料剝離成本 980 萬美元。

With that, we will turn the call back to the operator and open the call up to questions.

接下來，我們將把電話轉回給接線生，並開放提問環節。

(Operator Instructions) Your first question comes from Heiko Ihle from H. C. Wainwright.

（操作說明）您的第一個問題來自 H. C. Wainwright 公司的 Heiko Ihle。

I hope you feel better. Congratulations on strong year and delivering on your promises. I think the change in share price today if nothing else certainly reflects on the good job you've done.

希望你感覺好些。恭喜你度過了碩果累累的一年，並兌現了你的承諾。我認為，今天股價的變化，即便沒有其他因素，也無疑反映了你們出色的工作成果。

Thank you, Heiko.

謝謝你，海科。

You're welcome. Your Glencore offtake contract expires in May 2020. I mean, this may sound pretty far away, but philosophically, I mean it is 14 months. Philosophically, can you just walk us through your thoughts on the renewal and changes of terms that you think you'd see, given current vanadium prices and the fact that the counterparties know each other a little bit better and all that good stuff? Just philosophically walk us through what you're seeing if you've done it already or would you expect to see, please.

不客氣。您的嘉能可承購合約將於 2020 年 5 月到期。我的意思是，這聽起來可能很遙遠，但從哲學角度來說，這還有 14 個月的時間。從哲學角度來說，鑑於目前的釩價以及交易雙方彼此更加了解等因素，您能否談談您對續約和條款變更的看法？如果您已經觀察過，請從哲學角度為我們解釋一下您所看到的現象；或您預期會看到什麼。

Well, not that we're counting Heiko, but it's actually 13.5 months away right now. And we are working towards just about every possible option that could result from the termination of that contract or a continuation of that contract under very different terms than what we have today. So we are in the process of hiring a sales team who could take over for Glencore, very experienced people that we're interviewing and are looking at bringing on board. The timing for that is borderline perfect right now because a lot of the conferences and whatnot where contracts for 2020 will be signed, really start kind of in the end of the third quarter, beginning the fourth quarter of 2019. So we'll be in a very good position to do that. In the meantime, we're entertaining offers from multiple other parties who would like to step into Glencore shoes. All of the contracts that they are suggesting or proposals that they're suggesting are well within what I would call market norms for terms and conditions. And as you might suspect, we're also continuing our discussions with Glencore at their request because they would very much like to continue this contract. So all options are on the table. We're going to work that out so that we get the best arrangement possible for our shareholders. And Ernest, I hand it over to you to talk about some of our expectations in terms of top and bottom line once that current contract is terminated.

嗯，我們當然沒有把海科算在內，但實際上距離現在還有 13.5 個月。我們正在努力考慮終止該合約或以與今天截然不同的條款繼續履行該合約可能產生的幾乎所有選擇。所以我們正在招募一支能夠接替嘉能可的銷售團隊，我們正在面試一些經驗豐富的人，並考慮將他們招入麾下。現在這個時機簡直完美，因為很多 2020 年的合約簽署會議等等，實際上都是在 2019 年第三季末到第四季初開始的。所以我們將處於非常有利的位置來實現這一點。同時，我們正在考慮其他多家有意接手嘉能可業務的公司所提出的收購要約。他們提出的所有合約或方案都完全符合我所說的市場條款和條件的規範。正如你可能猜到的那樣，我們也在應嘉能可的要求繼續與他們進行討論，因為他們非常希望繼續履行這份合約。所以所有選項都在考慮範圍內。我們會想辦法解決這個問題，以便為我們的股東爭取最好的安排。歐內斯特，現在我把麥克風交給你，請你談談在現有合約終止後，我們對公司營收和利潤方面的一些預期。

Sure. Thanks, Mark. Yes, Heiko, so some of the things to think about, with Largo from Q4 onwards, effectively being at 1,000 tonnes per month run rate, so 12,000 tonnes per annum. That translates into just over 26.5 million pounds per annum. And the way to think about the increments is, the incremental gain -- dollar gain per pound, so on 26.5 million pounds, we're anticipating to gain at today's prices approximately $3.75, which is in the range of $100 million that flows down to EBITDA line. After tax, you're looking at about $85 million. So how do we get there? The $0.75 is effectively the gain that we get from the difference between the commissions we currently paid Glencore and the cost of actually engaging in our own logistics and marketing costs. And then, the other $3, the upside that we would gain both from selling ourselves without being under the structures of Glencore plus, being able to avail ourselves much more of the high purity market. So we see it somewhere in that range. $100 million on the EBITDA line, call it $85 million after taxes. So very significant, and we think it's a very important next step in the company's progress and maturity. So I hope that gives you some sense of what it means.

當然。謝謝你，馬克。是的，Heiko，所以需要考慮的一些事情是，從第四季度開始，Largo 的實際運行速度將達到每月 1,000 噸，即每年 12,000 噸。這相當於每年略高於 2650 萬英鎊。理解增量的方式是，增量收益－每英鎊的美元收益，因此，2,650萬英鎊，我們預計以今天的價格計算將獲得約3.75美元的收益，這相當於1億美元左右，將計入EBITDA。扣除稅款後，大約是 8500 萬美元。那我們該如何到達那裡呢？這 0.75 美元實際上是我們從目前支付給嘉能可的佣金與我們實際開展自己的物流和行銷成本之間的差額中獲得的收益。此外，還有 3 美元，這筆額外收益來自於我們出售自身，不再受嘉能可集團的架構約束，並且能夠更多地利用高純度市場。所以我們認為它就在這個範圍內。EBITDA 為 1 億美元，稅後約 8,500 萬美元。所以這意義重大，我們認為這是公司發展和成熟過程中非常重要的一步。希望這能讓你對它的意義有所了解。

It does. And I appreciate it. And I got one more for you, and this is also slightly more philosophical question. I'm bringing it up because Mark essentially started this conference call talking about it. You've paid of the majority of your debt obviously and you're actually sitting on that cash position now if you look at the $206 million in cash with $170 million of the current portion of long-term debt. And I understand that the -- I mean, Maracás continues to print money And I mean, there are some expenses with the expansion plan and all that good stuff. But I mean, the expenses should be done in Q2, Q3, and you're still generating a lot of money presumably even more after that's done. You don't to the best of my knowledge, have any big onetime expenses in Q4. And even until then you're generating cash, which we expect you guys to see with -- what should we expect you guys to do with all that money?

確實如此。我很感激。我還有一個問題想問你，這個問題也稍微偏向哲學層面。我之所以提起這件事，是因為馬克在這次電話會議開始時基本上就是在談論這件事。顯然，你已經償還了大部分債務，如果你看一下你現在的現金狀況，你會發現你有 2.06 億美元的現金，而長期債務的當前部分為 1.7 億美元。我知道——我的意思是，馬拉卡斯一直在印鈔票。我的意思是，擴張計劃和其他一些好事都會帶來一些開支。但我的意思是，這些開支應該在第二季、第三季完成，而且在那之後你仍然能賺到很多錢，估計還會更多。據我所知，你們第四季沒有任何大額一次性支出。即使在那之前你們也在創造現金流，我們希望你們拿這些錢做什麼？

Yes, Heiko, as we noted in our press release, and we'll stick to the script on that. We are, as a Board of Directors and the strategy that the company is undertaking right now, we are absolutely focused on getting cash back to shareholders right now. And that will be in the form of either dividends or a share buyback program. But our board has been going through the educational process. They've been working very hard on the pluses and minuses of all of those opportunities that we have to get money back to shareholders. That's what we're going to be focused on. We are not focused on any M&A activities and will not be for the mid to near term.

是的，海科，正如我們在新聞稿中提到的，我們會按照既定方案行事。作為董事會，我們以及公司目前正在實施的策略，絕對專注於立即向股東返還現金。而這將會以分紅或股票回購計畫的形式體現。但是我們的董事會一直在接受培訓。他們一直在努力分析我們擁有的所有機會的利弊，以便為股東帶來回報。這就是我們將要重點關注的面向。我們目前沒有專注於任何併購活動，並且在中短期內也不會進行此類活動。

Okay. That's as much detail as you want to provide presumably?

好的。想必您只想提供這些細節吧？

Yes.

是的。

Yes.

是的。

Your next question is from Curt Woodworth from Crédit Suisse.

下一個問題來自瑞士信貸的科特·伍德沃思。

I guess, just with respect to some modeling questions for the first quarter given the quarter is basically over, can you provide some guidance around your sales volumes for 1Q unit costs and ASP, I assume that you'd basically have those numbers by now, just because you have some inventory that you could sell down a little bit, I would assume that your unit costs would be a lot higher 1Q relative to the rest of the year just on the fixed costs absorption so.

我想，鑑於第一季基本上已經結束，關於一些建模問題，您能否提供一些關於第一季銷售量、單位成本和平均售價的指導？我假設您現在應該已經掌握了這些數據，因為您有一些庫存可以稍微減少一些。我假設由於固定成本的吸收，您的第一季單位成本相對於今年其他季度會高得多。

Yes, Ernest, do you want to take that? We have announced in our press release, Curt, what the production figures were for January and February. So those numbers are out there. And does look like we've done way better on the kiln turnaround project, which is as we let everyone know that's kind of an every other year type turnaround project that we have to undertake. But with that, little bit of extra information, Ernest, do you want to maybe talk to what the first quarter looks like in terms of total production and average sales price?

是的，歐內斯特，你想拿嗎？Curt，我們在新聞稿中已經公佈了1月和2月的生產數據。所以這些數據都公佈出來了。看起來我們在窯爐檢修計畫上做得好多了，正如我們告訴大家的那樣，這是一個我們必須每兩年進行一次的檢修計畫。不過，歐內斯特，再補充一點信息，你想談談第一季的總產量和平均售價情況嗎？

Well, look, I think, Curt, what we're going to have...

嗯，你看，科特，我想，我們接下來要做的事…

I thought you're going to say you can.

我以為你會說你能做到。

Yes, to the extent that we can -- we are only at this stage providing guidance on annual cash cost. Q1 clearly, will be higher because of the kiln refractory replacement. We may choose to provide some additional information to the market when we put up our operational press release, which should be around about, I think April 9th or 10th somewhere in that time line. We can actually see the exact production of the companies achieved during Q1. But at this stage, I wouldn't want to share or try and frame Q1 operating costs or production, but we'll have that in the market very soon. So effectively in a week and a bit to wait.

是的，在力所能及的範圍內——我們目前只能提供年度現金成本的指導。Q1 顯然會更高，因為窯爐耐火材料需要更換。我們可能會在發布營運新聞稿時向市場提供一些額外信息，新聞稿應該會在 4 月 9 日或 10 日左右發布。我們實際上可以看到各公司在第一季取得的確切產量。但現階段，我不想透露或試圖預測第一季的營運成本或產量，但我們很快就會將相關資訊推向市場。所以其實還需要等待一週多一點的時間。

Yes, and just to kind of help put that into as much perspective as we can, Curt, the kiln refractory replacement job will actually conclude tomorrow, the 28th. And the cooler section, it will be done on the 28th as well. That means about 72 hours of tier time, and we plan to start feeding the kiln on March 31st starting production of V2O5, again, on April 1st, so we will have no impacts to the second quarter whatsoever.

是的，為了盡可能地幫助我們理解這一點，Curt，窯爐耐火材料的更換工作實際上將於明天，也就是 28 號結束。冷藏室部分也將在28號完成。這意味著大約需要 72 小時的堆料時間，我們計劃在 3 月 31 日開始向窯爐進料，並在 4 月 1 日再次開始生產 V2O5，因此我們對第二季不會有任何影響。

Okay. And what do you guys calculate as the average index price for vanadium for 1Q?

好的。你們計算出來的釩在第一季的平均指數價格是多少？

No, we haven't closed 1Q yet. But...

不，我們第一季還沒結束。但...

Quarter-to-date? Just -- not everyone gets that, the European data?

本季至今？只是──不是每個人都能理解歐洲的數據？

Yes. So we're currently at $13.87 is the current price. So we'll be looking at about something in the $14.50 to $15 range probably by the time the quarter is all set and done, but again, something else that we can provide in about just over a week's time.

是的。所以目前的價格是 13.87 美元。所以到本季結束時，價格可能會在 14.50 美元到 15 美元之間，但我們還可以在一周多一點的時間內提供其他資訊。

Okay. So you said -- okay, so you think the average index price would be $14.50 to $15 for 1Q, is that...

好的。所以你說——好的，你認為第一季的平均指數價格會在 14.50 美元到 15 美元之間，是嗎…

Yes.

是的。

Okay. Okay, and then -- and in terms of thinking about the high purity market for you this year, can you speak to what you see in terms of high purity premiums, gross or net to you, post-Glencore? And then what level of -- or what percent of volume you think would be in high purity this year?

好的。好的，那麼——就您今年對高純度市場的看法而言，在嘉能可收購之後，您能否談談您對高純度溢價（包括毛溢價和淨溢價）的看法？那麼，你認為今年高純度產品的產量會達到多少水準──或者說，佔總產量的百分之多少？

Yes, Curt, we've been working with Glencore because as you know, they actually get to make those decisions, all that we can do is try to influence those decisions, but needless to say we've been trying to influence them relatively hard. And it's our belief that Glencore will hit at least 2,000 tonnes of high purity sales for us this year, if not higher. And the premiums that they have negotiated with the high purity customers for 2019 appear to be somewhere in about the USD 1.40 to USD 1.50 per pound range at U.S. We will get half of that amount at Largo, Glencore gets the other half. Hope that helps.

是的，Curt，我們一直在與嘉能可合作，因為你知道，他們才是最終的決策者，我們所能做的就是嘗試影響他們的決策，但毋庸置疑，我們一直在努力施加影響力。我們相信，嘉能可今年至少會為我們帶來 2,000 噸高純度產品的銷售額，甚至可能更多。他們與高純度客戶協商的 2019 年溢價似乎在美國每磅 1.40 至 1.50 美元左右。我們在 Largo 將獲得其中的一半，嘉能可獲得另一半。希望對您有幫助。

Okay. And what was the -- on the 2018 basis for premiums? I thought they were about the same level.

好的。2018 年的保費是多少？我原以為他們水準差不多。

That was based on -- remember, we talked about that in prior earnings calls and those premiums were largely based on 2-year contracts that Glencore had negotiated with their customers back in late 2016. And those premiums were in 2 cases, one was $0.90 a pound and the other one was $0.70 a pound. And so we got half of those premiums whenever our sales went to those customers.

這是基於——記住，我們在先前的財報電話會議上討論過這一點——這些溢價主要基於嘉能可於 2016 年底與客戶談判達成的 2 年期合約。這兩種情況下，保費分別為每磅 0.90 美元和每磅 0.70 美元。因此，每當我們的銷售產品銷往這些客戶時，我們就能獲得其中一半的溢價。

Okay. Got it. And then, maybe just one final one for me. Ernest, when you talk about the $3 per pound uplift post the Glencore contract expiry, what is your assumption built into the $3 per pound for what the high purity premium is?

好的。知道了。然後，也許我最後還要再來一杯。歐內斯特，當你談到嘉能可合約到期後每磅黃金價格上漲 3 美元時，你對這 3 美元的高純度溢價作何假設？

Yes, so that is, both $3 for high purity and not to be indelicate about it, but the actual current structure of the Glencore contract that will no longer be in place. So there's an opportunity cost gain there and, again, we're -- just selling high purities. So I'm not providing any guidance as to how to break that down, but between the two about $3.

是的，也就是說，高純度礦石的價格是 3 美元，而且恕我直言，嘉能可目前的合約結構將不再有效。所以這裡存在著機會成本效益，而且，我們只是在銷售高純度產品。所以我不會提供任何關於如何分解這筆錢的指導，但兩者加起來大約是 3 美元。

Your next question is from Piyush Sood from Morgan Stanley.

下一個問題來自摩根士丹利的Piyush Sood。

This is Lynn on for Piyush. So a couple of questions from us. First, if you could just start more broadly on the vanadium market. Are you seeing any changes to Chinese vanadium production from the steelmaking side of things, assuming local iron ore production may have gone up somewhat? And do you anticipate any impact on vanadium as China looks to use more low-quality iron ore, while prices stay high in 2019?

這裡是Lynn替Piyush報道。我們有幾個問題。首先，如果你能更廣泛地從釩市場著手就好了。假設當地鐵礦石產量增加，您是否觀察到中國煉鋼業的釩產量有任何變化？鑑於中國在 2019 年尋求使用更多低品質鐵礦石，而價格又居高不下，您預計這會對釩市場產生什麼影響？

Yes, let me answer that, again, to the best of our ability Lynn, but we are aware of one Chinese producer who has reintroduced domestic iron ore as their feedstock at their steel mill. And so there will be some limited amount of additional vanadium flake that is produced by that producer who will then send it to their subsidiary vanadium company and produce some vanadium from it. It will not largely impact the current supply and demand deficit. That will remain the same. We are, however, starting to see, I think there's been a couple of stone coal operating permits issued in China right now. So we do expect to see a couple of these stone coal operations start to come online later this year. The fact of -- the situation right now is that the supply and demand situation has not changed one bit. The steel rebar producers are, in fact, complying with the new vanadium standard that took effect in November of 2018. The Chinese government is sending inspectors out to ensure that compliance and, although we do see some additional production coming online, it's going to be at the latter part of 2019. And so this supply and demand deficit is going to be with us for the better part of 2019, and we expect robust pricing to remain pretty much status quo for the time being until we see how that new production comes on.

是的，林恩，讓我再次盡我們所能回答這個問題，但我們知道有一家中國生產商在其鋼鐵廠重新引入了國產鐵礦石作為原料。因此，該生產商會生產一定數量的額外釩片，然後將其送到其子公司釩公司，並從中生產一些釩。這不會對目前的供需缺口產生太大影響。這一點將保持不變。不過，我們似乎開始看到，目前中國已經頒發了幾張石煤開採許可證。因此，我們預計今年稍後將有幾家石煤礦企業開始投產。事實是，目前供需狀況絲毫沒有改變。事實上，鋼筋生產商正在遵守2018年11月生效的新釩標準。中國政府正在派出檢查人員以確保合規，雖然我們看到一些額外的產能即將上線，但這要等到 2019 年下半年。因此，這種供需不平衡的局面將在 2019 年的大部分時間裡持續存在，我們預計在新的生產情況出來之前，強勁的價格將基本保持現狀。

Okay. And then, if we could move on to Largo's operations, a couple of questions there. Could you touch on Largo's updated maintenance CapEx and expansion CapEx numbers for 2019? And how those jibe with the unchanged cash cost expectations? We would have expected the operational inefficiencies from January and February to maybe pressure 2019 costs on the high end, but the additional expansion CapEx that you'll be spending to improve operational reliability for the debottlenecking initiative we might have expected to bring costs lower. So can you give us your thoughts on that?

好的。然後，如果我們能談談 Largo 的營運情況，我有幾個問題想問。能否介紹一下 Largo 公司 2019 年最新的維護資本支出和擴大資本支出資料？這些與不變的現金成本預期相符嗎？我們原本預期 1 月和 2 月的營運效率低下可能會使 2019 年的成本居高不下，但為了提高消除瓶頸計畫的營運可靠性而額外投入的擴張資本支出，我們原本預計會降低成本。您能談談您的看法嗎？

Ernest, do you want to address that one?

歐內斯特，你想談談這個問題嗎？

Yes. Yes, so let me first deal with CapEx and then we'll talk about costs afterwards. So Lynn, as you know, and then I'll call it unconventionally, we're about USD 4 million on maintenance CapEx. And when we do the kiln refractory, you generally speaking every other year then add another $4 -- sorry, $4 million. So for about $8 million total in the kiln refractory replacement here. If you look at our guidance, if you build it up from what -- let's call it base maintenance CapEx, we are looking to spend about -- and these numbers are on the MD&A, so they're all public. But we're looking to spend about $3.5 million on the kiln this year. So just shy of the $4 million that we usually estimate. We -- in this year, in 2019 we do have some pretty significant expenditures on savings bonds which we won't have in future years. So that's a differentiating factor this year. There's about $2.7 million there. And we're doing some crushing improvements that's about USD 400,000. And then we're also actually acquiring some land and there's about $1.5 million ticket on all those land purchases. So if you added it all up that gets you to about $8.1 million, you add it to the $4 million of our base maintenance CapEx that brings you to $12.1 million, which is right in the midline of our maintenance CapEx line. As it relates to the expansion CapEx, I can't really point to anything specific that's taking us from that $15 million -- $15.5 million to $19 million to $21 million, other than to say that we are specking the equipment to a much higher standard. So there is some increases there. But those are the explanations around the CapEx side. If we turn our attention to expenditures, the best I could do is maybe use Q4 operating cost per pound, excluding royalties on a U.S. dollar basis and talk about some of the increments that take us to our guidance. So if you started at $3.26, here a couple of other things that are causing higher costs in 2019. I guess the most important one relates to mining cost. So we are mining some areas with the pushbacks in the pit that are slightly lower quality than they were in 2018. And so there's about a $0.13 impact, but again, this is one sort of -- we sort of return to norm in 2020 onwards. But in 2019, we're seeing about $0.13 there. Then there's about $0.03 uptick in G&A, this relates to personnel and HR cost as we improve the lives and day-to-day running of our personnel at the mine including transportation and various other thing, so there's about $0.03 there. The other big one would be the loss of the Reintegra tax credit that happened in Q4 last year. We have no control of that. There's about $0.06 there. And then, the other item that is large to my mind would be power, the increase in power cost is not linear with our expansion. There's some price stickiness there. So I would add another $0.05. So you add all those factors together, you get about $0.27, which would put you at $3.53 if you bridge from Q4 costs. But bearing in mind that our costs on an annual basis for full year last year were $3.38, so we're guiding $3.45 to $3.65 with the $3.55 midpoint, but I hope those sort of cost elements that give you a good sense of why the increases in 2019.

是的。是的，那我先處理資本支出問題，之後再討論成本問題。所以，Lynn，正如你所知，然後我以一種非常規的方式來說，我們在維護資本支出方面大約有 400 萬美元。當我們進行窯爐耐火材料改造時，通常每隔一年就要額外增加 400 萬美元——抱歉，是 400 萬美元。所以，這次窯爐耐火材料更換總共花了約 800 萬美元。如果你看看我們的指導意見，如果你從——我們稱之為基礎維護資本支出——開始推算，我們預計支出大約——這些數字都在管理層討論與分析中，所以它們都是公開的。但我們今年計劃在窯爐上花費約 350 萬美元。所以比我們通常估計的 400 萬美元略少一些。今年，也就是 2019 年，我們在儲蓄債券方面有一些相當大的支出，而未來幾年我們將不會再有這樣的支出。所以這是今年的一個不同之處。那裡大約有270萬美元。我們正在進行一些重大改進，大約需要 40 萬美元。此外，我們也正在購買一些土地，所有這些土地收購的總金額約為 150 萬美元。所以，如果把所有費用加起來，大約是 810 萬美元，再加上我們 400 萬美元的基本維護資本支出，就達到了 1210 萬美元，正好在我們維護資本支出的中位數。至於擴建資本支出，除了說我們正在以更高的標準配置設備之外，我真的無法指出是什麼具體原因導致我們的支出從 1500 萬美元到 1550 萬美元增加到 1900 萬美元再到 2100 萬美元。所以這方面確實有一些成長。但以上是資本支出方面的解釋。如果我們把注意力轉向支出，我能做的最好的就是使用第四季度每磅的營運成本（不包括以美元計價的特許權使用費），並談談一些使我們達到預期目標的增量。所以，如果你最初是 3.26 美元，那麼以下是 2019 年導致成本上漲的其他幾個因素。我想最重要的因素與採礦成本有關。因此，我們在礦坑中一些被推回的區域進行開採，這些區域的礦石品質比 2018 年略低。因此，這會產生大約 0.13 美元的影響，但再說一遍，這是一種——我們從 2020 年開始逐漸恢復正常。但到了 2019 年，我們看到的價格大約是 0.13 美元。然後，一般及行政費用增加了約 0.03 美元，這與人員和人力資源成本有關，因為我們改善了礦區員工的生活和日常運營，包括交通和其他各種事項，所以這方面大約增加了 0.03 美元。另一個重大影響是去年第四季取消的 Reintegra 稅收抵免。我們對此無能為力。那裡大約有 0.06 美元。然後，我認為另一個重要的因素是電力，電力成本的成長與我們的擴張並非線性成長。那裡的價格存在著一定的黏性。所以我還要再加 0.05 美元。所以把所有這些因素加起來，大約是 0.27 美元，如果從第四季的成本算起，那就是 3.53 美元。但考慮到我們去年全年的年度成本為 3.38 美元，因此我們預計價格在 3.45 美元至 3.65 美元之間，中點為 3.55 美元。我希望這些成本因素能讓您更能理解 2019 年價格上漲的原因。

So following up on that, should we expect the increased expansion CapEx to translate into lower operating costs may be starting in 2020?

那麼，我們是否可以預期，從 2020 年開始，不斷增加的擴張資本支出將轉化為更低的營運成本？

That is correct. I'm not going to hazard a guidance during this call. But it will clearly just from a unitary impact, it will actually reduce the cost. So we can look forward to lower operating costs in 2020 onwards, especially at that 1,000 tonne per month run rate, and obviously, Lynn, as you appreciate, we're looking to do better than 1,000, but 1,000 tonnes per month is what we're officially telling the world, and we're going to try our best to do better than that each and every month, but it will reduce cost.

沒錯。這次通話我不會給任何指導意見。但僅從單位影響來看，顯然會降低成本。因此，我們可以期待從 2020 年開始營運成本降低，尤其是在每月 1000 噸的運行率下。顯然，林恩，正如你所了解的，我們希望做得比 1000 噸更好，但每月 1000 噸是我們正式向外界公佈的數字，我們將盡最大努力每個月都做得更好，但這將會降低成本。

Let me also add, Lynn, that some of the increase in the expansion capital has to do with decisions that we made operationally to improve the reliability of the plant. That means more units being produced on a more regular basis. And that's all for the betterment of shareholder value as well.

林恩，我還要補充一點，擴建資金的增加部分與我們在營運上為提高工廠可靠性而做出的決策有關。這意味著要更規律地生產更多數量的產品。而這一切也都是為了提升股東價值。

Okay. And then just 2 more quick ones. In the press release, you had mentioned that the company expects to see a significant negative remeasurement of trade receivables in the first quarter because of pricing trends. Can you quantify that to some extent for us? I think that Largo has really only had 1 prior quarter of negative remeasurement of trade receivables and that was fairly small. So how should we be thinking about it for the first quarter?

好的。然後就再來兩個速戰速決的。在新聞稿中，您曾提到，由於價格趨勢，公司預計第一季應收帳款將大幅負向重估。您能否為我們量化一下？我認為 Largo 先前只有第一季出現過貿易應收款負值重估，而且金額相當小。那麼，對於第一季度，我們該如何考慮這個問題呢？

Great question, Lynn. And I saw your note that's already come out this morning. So the number that you showed in your note there, I think it was a Canadian dollar number, I think CAD 34 million or so.

問得好，琳恩。我看到了你今天早上發布的那份聲明。所以你在筆記裡顯示的那個數字，我想應該是加幣，大概是 3400 萬加元左右。

Yes, CAD 34 million. Yes.

是的，3400萬加幣。是的。

Yes, that is in an order range. And, again, because I can't speak about the Glencore contract away for our other investors to think about it to just simplify it is that we weren't necessarily realized the full accounts receivable that relates to trade receivables at the year-end of USD 55 million -- sorry, CAD 55 million but a lower number, but so something in that CAD 30 million to CAD 35 million range is not untoward Canadian.

是的，這屬於某個範圍。再說一遍，因為我不能替其他投資者談論嘉能可的合同，所以簡單來說，我們並沒有完全實現年底與貿易應收款相關的全部應收賬款，金額為 5500 萬美元——抱歉，是 5500 萬加元，但實際金額要低一些，3000 萬加元到 3500 萬加元之間並不算少。

Okay. And then final question, can you give us a little bit more detail on the unanticipated outages back in January and February? And what caused those? Can they recur, again, and what preventative measures is Largo taking to make sure that, that doesn't happen?

好的。最後一個問題，能否詳細介紹一月份和二月發生的意外停電事件？這些現像是什麼原因造成的？這些事件會再發生嗎？拉戈公司正在採取哪些預防措施來確保這種情況不會再次發生？

I'll take that one, Ernest. These are unanticipated power outages that come from our local supplier. There's actually nothing in our control on those. So we are looking at ways that we can minimize those impacts, Lynn. And I won't get into a lot of the details, but it does include having the capability of generating our own power, possibly storing our own power and trying to avoid those types of uncontrollable or unanticipated situations. Vanadium business and the production of vanadium is a very complex chemical operation, and I think the general rule that we all live by is engineers in this operational world is you always want to keep that plant running. It's like an airplane, the only time that you really have issues is startup and shutdown. So you want to make sure you minimize those activities and some of what we're talking about earlier for increases on -- slight increases in capital for the expansion project and improving reliability that will help us keep that plant online in a more reliable way day to day and that is our goal right now. Those are all unanticipated. We continue to work with our local power provider on ways that we can help them with some of their continuing maintenance programs to keep the grid as fully functional at all times as possible.

我來做那個吧，歐內斯特。這些都是本地供應商造成的意外停電。實際上，這些事情我們根本無法控制。所以，我們正在尋找能夠最大限度減少這些影響的方法，琳恩。我不會贅述太多細節，但它確實包括具備自行發電的能力，可能還會儲存自己的電力，並努力避免那些無法控製或無法預料的情況。釩產業和釩的生產是一個非常複雜的化學操作，我認為我們在這個營運領域中都遵循的一條普遍原則是，工程師們總是希望維持工廠的運作。這就像飛機一樣，只有在啟動和關閉時才會出現問題。所以，你要確保盡量減少這些活動，以及我們之前討論的一些增加——擴建項目的資本略微增加，以及提高可靠性，這將有助於我們以更可靠的方式使該工廠每天保持在線，這就是我們目前的目標。這些都是意料之外的情況。我們將繼續與當地電力供應商合作，探討如何幫助他們進行一些持續的維護計劃，以盡可能保持電網始終處於完全正常運作狀態。

Your next question is from Lee Cooperman from Omega.

你的下一個問題來自 Omega 的 Lee Cooperman。

I'm a little confused about couple of things. You mentioned you had cash of $206.2 million, debt of $29.1 million. Is that currently or is that at year-end? And if it's a year-end, what is your current net cash position? One. Two, at the current level of production and pricing, what amount of cash are we generating on a monthly basis? I had previously calculated like $20 million a month of free cash flow. I don't know where that is with current prices, but that would be question #1 and #2.

我對一些事情有點困惑。你提到你有2.062億美元的現金，2910萬美元的債務。是指目前的情況還是年底？如果是年末，您目前的淨現金狀況如何？一。第二，在目前的生產和定價水準下，我們每個月能產生多少現金流？我之前計算過，每月自由現金流大約有2000萬美元。我不知道以目前的價格計算，但這應該是問題一和問題二。

You want to do this first before we get into other questions may be...

在我們討論其他問題之前，你可能會想先做這件事…

Yes, get in -- we have a few.

是的，進來吧——我們還有幾個。

Yes, that's a surprise, Lee. So cash, the $206 million at the year-end -- debt at year-end was CAD 117 million, so net was CAD 89 million odd. On a U.S. dollar basis, that's sort of $67 million, $68 million net at year-end. So that, that debt number that we have provided is current, but we haven't provided the cash number and I'm not...

是的，這確實令人驚訝，李。因此，年末現金為 2.06 億美元——年末債務為 1.17 億加元，因此淨額為 8,900 萬多加元。以美元計算，到年底淨額約 6,700 萬美元至 6,800 萬美元。所以，我們提供的債務數字是當前的，但我們還沒有提供現金數字，我也不確定…

It's an open mic, why don't you do it now? I mean, everybody has equal footing.

這是開放麥環節，為什麼不現在就上台表演呢？我的意思是，人人平等。

No, we're going to close the quarter and then we'll tell everybody what our cash is. So but what I can guide you Lee is to think about the cash generation. So if you're starting on a net basis at year-end of USD 67 million, USD 68 million, as you can appreciate with the reduction in price, we were at some lofty heights there generating close to USD 21 million. At the current pricing, you're more in the USD 12.5 million per month, give or take very rough, but I mean, that would be a good number to use.

不，我們先完成季度結算，然後再告訴大家我們的現金狀況。所以，李，我能給你的建議是，要考慮如何創造現金流。因此，如果以年底淨收入 6700 萬美元、6800 萬美元為基準計算，正如您所看到的，考慮到價格的下降，我們當時的業績非常出色，接近 2100 萬美元。以目前的定價，你每個月大概要花 1250 萬美元，這只是一個大概的數字，但我的意思是，這應該是一個比較合適的數字。

So basically, roughly speaking they'll be better $125 million of cash -- net cash come June when you're in a position to do something, is that about right?

所以基本上，粗略地說，到六月他們就能擁有 1.25 億美元的現金——淨現金，到那時他們就可以採取行動了，是這樣嗎？

That's correct except for -- the other thing that you got to remember is we have receivables at year-end. So as I said to Lynn earlier on the call, we're not going to recover the full 55 but there will be some -- there'll be another $20 million out there from receivables that will obviously flow into cash, but excluding that impact, yes, you're 100% correct.

沒錯，不過還有一點要記住──那就是我們在年末會有應收帳款。正如我之前在電話會議上對 Lynn 所說，我們無法收回全部 5500 萬美元，但會收回一部分——還有 2000 萬美元的應收賬款顯然會轉化為現金，但排除這部分影響，是的，你的說法完全正確。

Yes. And what amount of minimum cash do you need to run the business?

是的。那麼，你至少需要多少現金才能維持業務運作？

That's the size about $20 million to $25 million.

規模大約在2000萬美元到2500萬美元之間。

So roughly speaking, dealing with round numbers, it will be about maybe $100 million available for dividends or stock repurchase or whatever?

粗略估計，大概會有 1 億美元可用於分紅、股票回購或其他用途？

Yes. A bit more, $100 million to $120 million, but in that range, yes.

是的。稍微多一點，大概 1 億到 1.2 億美元，但在這個範圍內，是的。

Got you. Okay. And are you guys surprised the current prices because I had the feeling, we speak to a consultant, you speak to the same guy. Team is looking for materially higher prices, are you guys surprised? And what do you see as the outlook for pricing?

抓到你了。好的。你們對目前的價格感到驚訝嗎？因為我感覺，我們和顧問交談，你們和顧問交談的是同一個人。團隊想要的價格高很多，你們感到驚訝嗎？您認為價格前景如何？

Yes, I'll answer that one. We absolutely really are having a hard time figuring out what's causing things to happen in the market the way they are right now because the fundamental supply deficit has not changed one bit. And in fact, orders for vanadium are going up in China as a result of this rebar standard. So it's very, very difficult to explain what's going on. But I think it's the general consensus that we're reaching in the industry is that there is an anticipation for additional production coming on in the latter part of 2019 and that has just kind of caused a mood shift in the market. But the fundamental supply deficit has not changed and, in fact, is getting worse every day and inventories do not exist. So I still expect that we're going to see the facts of the market takeover and the mood part of this thing is going to go away because they're just is not enough vanadium.

是的，我會回答這個問題。我們真的很難弄清楚是什麼原因導致市場目前呈現出這樣的局面，因為基本的供應短缺問題絲毫沒有改變。事實上，由於這項鋼筋標準，中國對釩的需求正在上升。所以，要解釋到底發生了什麼，真的非常非常困難。但我認為業界普遍的共識是，預計 2019 年下半年將有更多產量投產，這已經引起了市場情緒的轉變。但根本性的供應短缺問題並沒有改變，事實上，情況每天都在惡化，庫存根本不存在。所以我仍然認為我們會看到市場接管的事實，而這件事的情緒部分將會消失，因為釩的供應量根本不夠。

If I could make a suggestion for you, I'm not telling you what approach to take, but -- what decision to make, but I think you guys have to decide what you think your business is worth. And assuming normalized pricing. And if the stock is materially below the value of your business, I think one -- and I don't know Canadian laws or I may be saying something that's not practical from a Canadian standpoint, but you have so many different series of warrants with different strike prices. Determine the price you're prepared to buy your stock back, if they determine that buying back stock takes precedent over paying a dividend and put a different price for each one series to take the warrants out, this way you don't affect the liquidity of the common stock and you take out the warrant guys are essentially getting a free ride. And they have to put up their money to exercise their stock. And I would look at that as a approach to stock repurchase. In other words, for each different warrant outstanding give a specific price you're prepared to pay for that warrant take into account, the exercise price of the warrant. It will minimize your use of cash. It will still give you a position to buy back more stock should the stock not respond favorably to the buyback. But I'm happy to talk about more about that off-line if you like.

如果我能給你們提個建議，我不是告訴你們該採取什麼方法，而是告訴你們該做什麼決定，但我認為你們必須決定你們的企業值多少錢。假設價格正常。如果股票價格遠低於公司價值，我認為——我不了解加拿大法律，或者我可能從加拿大角度來看說一些不切實際的話——但是你有很多不同系列的認股權證，行使價格各不相同。確定你願意以什麼價格回購你的股票。如果他們認為回購股票優先於支付股息，並為每一系列認股權證設定不同的價格，這樣就不會影響普通股的流動性，而認股權證持有者實際上可以免費獲得收益。他們必須拿出資金才能行使股票選擇權。我會把這看作是一種股票回購策略。換句話說，對於每張未行使的認股權證，給出你願意為該認股權證支付的具體價格，同時考慮該認股權證的行使價格。這將最大限度地減少你的現金使用。即使股票對回購反應不佳，你仍然可以繼續買進更多股票。如果你願意的話，我很樂意私下和你詳細談談這件事。

We welcome those discussions whenever we get them with you, Lee, so we will set up a separate call on that.

李，我們隨時歡迎與您進行此類討論，所以我們會另行安排一次通話。

Your next question is from James Young from West Family Investment.

下一個問題來自 West Family Investment 的 James Young。

My question pertains to the recovery rates and I believe in -- for '18 you had mentioned that you had recovery rates of 77%, with the kiln refractory when that's completed, what you would expect the normalize recovery rates to be on an annual basis?

我的問題與回收率有關，我相信——您曾提到 2018 年的回收率為 77%，窯爐耐火材料完工後，您預計每年的正常回收率會是多少？

Jim, thanks for the question. And I think the way to look at this right now is that 2018 was one of our better years for recovery and I'm very proud of what the operations team was able to do during the calendar year, particularly knowing that they had to struggle with a refractory problem in the kiln for most of 2018. With that issue now being addressed through this turnaround that will be completed tomorrow, you'll see that recovery rate start to come in a lot stronger, a lot more reliably and it will be less volatile during the course of the year. So our goal as a company is still to pursue recoveries that are 80% or higher, and that recovery rate is just free money to the company. So that's -- it's a huge focus that we have at the operational level, and we want to bring that recovery in with less volatility as we continue to learn how to operate our plant better and better every day.

吉姆，謝謝你的提問。我認為現在看待這個問題的方式是，2018 年是我們復甦情況較好的一年，我為營運團隊在這一年中所取得的成就感到非常自豪，尤其是在知道他們在 2018 年的大部分時間裡都不得不與窯爐的耐火材料問題作鬥爭的情況下。隨著明天即將完成的這項整改措施的實施，這個問題將得到解決，你會看到復甦率開始變得更加強勁、更加可靠，並且在今年內波動性會更小。因此，我們公司的目標仍然是追求 80% 或更高的回收率，而這樣的回收率對公司來說就等於白拿錢。所以，這是我們在營運層面的一個重點，我們希望在不斷學習如何更好地運作工廠的同時，以更小的波動性實現復甦。

Okay, great. And for every 1% change in recovery, what does that mean to production on a monthly basis?

好的，太好了。回收率每變化 1%，對每月產量又意味著什麼？

Ernest, speak of that figure of the top of your head.

歐內斯特，說說你頭頂上的那個形狀吧。

Yes. Jim and I had this discussion before. So I hesitate to answer, but there's a -- it can be -- on a book basis, it's about 100 tonnes. In fact, (inaudible) what Mark was saying that we haven't provided guidance and just to do (inaudible) 2018 was the best recovery year. So I think let's be fair to ourselves here and treat that as the baseline, and we're going to try and work towards 80, so I know that's a pretty broad range. But as you can appreciate those 1% uptick, so it was a very significant impact, so upwards of 300 tonnes. So if we can achieve it, we will do our best to actually get to that level. Let's see how we go, but we're going to be in and around that range.

是的。我和吉姆之前討論過這個問題。所以我猶豫要不要回答，但是──可以這麼說──以帳面資料來看，大約是100噸。事實上，（聽不清楚）馬克說的是，我們沒有提供指導，只是（聽不清楚）2018 年是最好的復甦之年。所以我覺得我們應該公平對待自己，把這個當作基準，然後努力達到 80 分，我知道這是一個相當廣泛的範圍。但正如你所看到的，這 1% 的成長影響非常顯著，超過了 300 噸。所以如果我們能做到，我們一定會盡全力達到那個水準。讓我們看看情況如何，但我們應該會在這個範圍內波動。

Yes, and just to emphasize the point that Ernest just made, that 77% was our best ever. And based on looking at other vanadium operations in the world that is considered absolute world-class operation. So we will be improving upon our world-class situation if we can get it above 77%.

是的，而且正如歐內斯特剛才所說，77% 是我們有史以來最好的成績。根據對世界其他釩礦開採項目的考察，這被認為是世界一流的開採項目。所以，如果我們能將這一比例提高到 77% 以上，我們就能進一步提升我們世界一流的水平。

Understood. And then the last question is, in your production guidance for 2019, were you assuming -- what were you assuming for recovery rates?

明白了。最後一個問題是，在你們 2019 年的生產指引中，你們對回收率做了哪些假設？

I think we're going to talk about that -- yes, and we can talk about it. We basically assume the same as for 2018. So we are in and around that 77% range.

我想我們會談談這件事——是的，我們可以談談這件事。我們基本假設與 2018 年相同。所以我們現在處於77%左右的範圍內。

Your next question is from Brian Nunes from Gramercy.

你的下一個問題來自 Gramercy 的 Brian Nunes。

Couple of questions from me. The -- I feel in the note -- in the MD&A, you note that there's going to be no acquisitions, planned M&A, but there is a big exploration program underway to further define the resources in the various properties. And there was talk of potentially doubling the size of the existing operation. How does that -- is that being tabled for now if the talk is returning value back to shareholders rather share buybacks or dividends, or is that still on the table for the board to decide?

我有幾個問題。我覺得——在管理層討論與分析中，您提到不會有收購，也沒有併購計劃，但目前正在進行一項大型勘探計劃，以進一步確定各個礦產的資源量。有消息稱，可能會將現有業務規模擴大一倍。如果目前的討論重點是為股東創造價值而不是股票回購或分紅，那麼這個問題是否暫時擱置？或者這個問題仍然由董事會決定？

So the project that we're undertaking to look at potentially doubling the production capacity, we throw that into the category of organic growth, Brian. And that is absolutely on the table and that effort is continuing. We hope to be able to publish some results on the engineering, the exploration and the market study efforts that we're undertaking in the near future here. So that is all on the table. The note in the MD&A and in the press release really talks about, and is designed to make sure, that we make it clear that M&A activity in terms of buying other companies or other assets outside of what we have in Brazil is not on the table and the board has been very specific in their direction on that point.

所以，我們正在進行的旨在將產能翻倍的項目，我們將其歸類為有機成長，布萊恩。這絕對在考慮範圍內，而且我們正在繼續努力。我們希望在不久的將來能夠在這裡公佈我們正在進行的工程、勘探和市場研究工作的一些成果。所以，所有問題都擺在桌面上了。MD&A 和新聞稿中的說明確實談到了這一點，並且旨在確保我們明確表示，收購我們在巴西以外的其他公司或其他資產的併購活動不在考慮範圍內，董事會在這方面已經明確表態。

Okay. So I mean, just to make it crystal clear, part of the, call it $100 million to $125 million available cash spent could be earmarked towards developing an expansion of the existing operation?

好的。所以我的意思是，為了說得更清楚些，這筆大約 1 億至 1.25 億美元的可用現金中的一部分可以指定用於現有業務的擴張？

Yes.

是的。

Okay, that's helpful. And I suppose we will get updated results from the drilling on the next call or before?

好的，這很有幫助。我想我們會在下次電話會議或之前獲得鑽探的最新結果吧？

Hopefully, before. We're very excited about that. That's been a major undertaking and our geology team has been working literally round the clock trying to get this data together. But it is a very large undertaking, a lot of meters are being drilled. And we're getting pretty excited to finalize all the review of that data and get it out to the public.

希望在此之前。我們對此感到非常興奮。這是一項重大工程，我們的地質團隊一直在日以繼夜地工作，努力收集這些數據。但這確實是一項非常龐大的工程，需要鑽探很多公尺。我們非常期待完成所有數據的審查工作，並將其公之於眾。

Okay. You mentioned that the -- there are some stone coalmines that will be given licenses that could potentially come back on at the end of this year. However, given the step shift in the amounts of tonnage that requires vanadium input and steelmaking with the introduction of these new rebar standards. Does the -- do these operations offset the existing supply deficit? It's my understanding that this supply deficit potentially last at least a year, 1.5 years, 2 years. And that may be is a little bit of change from that view, and just if you could expand a little bit on what you see as the potential production coming online from these stone coal mines?

好的。您提到過—有一些石煤礦將獲得許可證，這些礦場有可能在今年年底重新開放開採。然而，隨著這些新的鋼筋標準的引入，釩投入量和煉鋼量都發生了巨大的變化。這些操作能否彌補現有的供應缺口？據我了解，這種供應短缺的情況可能會持續至少一年、一年半、兩年。這或許與先前的觀點略有不同，您能否再詳細闡述您認為這些石煤礦投產後的潛在產量是多少？

Brian, there's -- part of the problem as always is the data you get from China, you need to really sit and think about for a while. The stone coal production numbers that we're getting from the actual stone coal operators themselves. Those numbers are numbers that have never been physically achieved at any of these mining sites. And so, we have to take those numbers and try to put some reality into them. And it is our opinion that, although there will be some increased level of production by the end of calendar year 2019, it will not take care of the supply deficit that we have not only in China but around the rest of the world as well. And the sum total on production versus demand worldwide remains in deficit. So our opinion hasn't changed there. The deficit may be slightly less then what we thought because of the new production coming on towards the latter part of the year, but we also don't believe that the stone coal operators will be able to produce anywhere close to what they're suggesting because they never have. And remember too that the stone-coal production that's coming on, I think this is a very important point as well. The stone-coal production that is starting to get some life that will be very expensive production as well. So in some ways, it starts to reset what kind of that minimum market price would be for the materials because they are the marginal producers.

布萊恩，問題的一部分在於──一如既往，你從中國獲得的數據，你需要好好坐下來思考一段時間。我們從實際的石煤生產商那裡獲得的石煤產量數據。這些數字在任何一個礦場都從未實際達到。所以，我們必須把這些數字轉化成現實。我們認為，雖然到 2019 年底產量會有所提高，但這並不能解決我們不僅在中國，而且在世界其他地方面臨的供應短缺問題。全球生產毛額與需求總和仍處於缺口狀態。所以我們在那方面的看法沒有改變。由於下半年將有新的產量投產，缺口可能會比我們預想的略小一些，但我們也不認為石煤業者能夠達到他們所聲稱的產量，因為他們從來沒有達到過。還有一點要注意的是，即將投產的石煤生產，我認為這一點也非常重要。石煤生產正逐漸恢復生機，但生產成本也會非常高。因此，在某種程度上，它開始重新定義原材料的最低市場價格，因為他們是邊際生產者。

Yes. Okay. That's helpful. I think -- I was scratching my head looking at your share price, to be honest. As I'm sure, you do too. And part of the thinking here is, we've seen in other industries may be targeting a different investor base, maybe resetting the -- targeting a larger investor base. And having your primary listing in Canada, is that still strategic for the company when it's -- it's beyond producer, let's be honest. And it's a new technology producer in terms of vanadium and what the uses that can be and maybe a listing in a more developed market might a, get you better coverage on your stock by the analyst pool. And maybe drive a larger investor base towards you. Have you -- has the Board been discussing this or is this something that the Board could undertake?

是的。好的。那很有幫助。說實話，我看著你們的股價都摸不著頭緒。我相信你也是一樣。這裡的部分想法是，我們看到其他行業可能正在瞄準不同的投資者群體，也許正在重新調整——瞄準更大的投資者群體。而將主要房源放在加拿大，對公司來說是否仍具有策略意義？說實話，這已經超出了製片人的能力範圍。而且，就釩及其用途而言，它是一家新技術生產商，在更發達的市場上市或許能讓分析師群體更好地關注你的股票。或許還能為你吸引更多投資者。董事會是否討論過此事？或者說，這是董事會可以著手處理的事情嗎？

It's actually something that the board has discussed and will continue to discuss. It's -- we think those types of ideas are good ideas, they're welcome, Brian, and the board has had those discussions. So we will continue to reevaluate that. And as the decisions are made by the board, we will announce those. But we do welcome those ideas.

這實際上是董事會已經討論過並將繼續討論的問題。我們認為這些想法都是好想法，我們歡迎這些想法，布萊恩，董事會也已經討論過這些想法了。所以我們會繼續重新評估這一點。董事會做出決定後，我們會公佈。但我們歡迎這些想法。

Great. Great. And then just the last thing, going on the power and the previous caller talked about it a bit. And power costs going up, seeing disruptions that are outside of your control. Is something like your own power generation specifically targeted as a use of cash this year or is that something that you're still contemplating? Can you -- I mean, we see a lots of mine programs now, [mine] companies now especially look at South Africa with the trouble that the state utility has starting to developing their own power with solar programs and stuffs like that. It seems to me being at your mine that there's definitely space and capacity for you to do something similar.

偉大的。偉大的。最後還有一件事，關於電源問題，上一位來電者也稍微談到了這個問題。電力成本上漲，還會出現你無法控制的干擾。今年是否計劃將資金專門用於自發電項目，還是仍在考慮中？你能——我的意思是，我們現在看到很多礦業項目，[礦業]公司現在尤其關注南非，因為南非的國有電力公司在發展自己的電力方面遇到了困難，他們開始採用太陽能項目等等。依我看來，你們礦場肯定有空間和能力讓你們做類似的事情。

Yes, first of all, let me note that the -- our power provider doesn't have anything close to the issues that South Africa has for power. So yes...

首先，我要指出的是，我們的電力供應商遠沒有南非那樣面臨嚴重的電力問題。是的…

No, no. I'm not suggesting that. No one does. I'm not suggesting that.

不，不。我並不是這個意思。沒有人這樣做。我並不是這個意思。

We aren't anywhere in that category at all. But we do look at producing every day what we want to produce every day as being a primary target of every employee in the company. That means that we need to look at ways to avoid these unanticipated power disruptions, then we get our engineering team to start evaluating different ways that we can do that. I don't anticipate any type of significant expenditure whatsoever in that category this year. But we are a constantly evolving organization, and we learn from our past. And so as we take a look at these power disruptions, we look at it as yet another opportunity to take a look at the issue of reliability and ability to produce regularly, and we will evaluate that, but I don't anticipate anything other than engineering studies this year. The performance has actually been pretty good by our local utility provider. We had more than a regular number of power outages in the first quarter. But we don't anticipate that continuing at all and they've had a very (technical difficulty) track record up until recently.

我們根本不屬於那一類。但我們確實將每天生產出我們想要生產的產品視為公司每位員工的首要目標。這意味著我們需要尋找避免這些意外電力中斷的方法，然後讓我們的工程團隊開始評估我們可以採取的不同方法。我預計今年在這個類別上不會有任何重大支出。但我們是一個不斷發展的組織，我們會從過去吸取教訓。因此，當我們審視這些電力中斷事件時，我們將其視為又一次審視可靠性和定期生產能力問題的機會，我們將對此進行評估，但我預計今年除了工程研究之外不會有其他進展。我們當地的公用事業供應商的表現其實相當不錯。第一季我們經歷了比平常更多的停電事故。但我們預計這種情況不會繼續下去，而且直到最近，他們的技術困難記錄一直都很糟糕。

Thank you. That concludes today's Q&A. I will now turn it back over for closing remarks.

謝謝。今天的問答環節到此結束。現在我將交還給對方，由他作總結發言。

Thank you, operator, and thanks to everyone for joining us today. As we noted, Largo's fourth quarter and full year 2018 results press release, financial statements and MD&A and our updated corporate presentation can be found in the Investor Relations section of our website at largoresources.com. That concludes our call. Have a great day, everyone.

謝謝接線員，也謝謝今天所有參與的朋友。正如我們所指出的，Largo 2018 年第四季度和全年業績新聞稿、財務報表和管理層討論與分析以及我們更新的公司介紹可以在我們網站 largoresources.com 的投資者關係部分找到。通話到此結束。祝大家今天過得愉快。

Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.

女士們、先生們，今天的電話會議到此結束。感謝您的參與，請您斷開線路。