Atlas Lithium Corp
For the period ended Dec 31, 2024. Filed Mar 14, 2025.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Mar 14, 2025
ATLX$1.64-2.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-03-27.
0001493152-24-011539
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-03-14.
0001493152-25-010384
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 106 previous paragraphs and 74 current paragraphs.
33 unchanged; 17 reworded; 23 added; 56 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 12 previous and 5 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (23)
Current report
Our modular dense media separation (DMS) lithium processing plant was manufactured in South Africa. It was designed to produce 150,000 tons of lithium concentrate per annum (“tpa”). The manufacturing process of the DMS plant was concluded in the end of 2024 and the plant was successfully shipped to Brazil. The shipment, consisting of 141 containers and 10 bulk items, departed the Port of Durban, South Africa, on February 2, 2025, and arrived in Brazil, Port of Santos, on March 7, 2025.
Current report
Our DMS plant represents a cornerstone of our Neves Project, designed to deliver high-quality lithium concentrate to the global market for electric vehicles (EVs) and renewable energy storage systems. With worldwide lithium demand growing, we are positioned to emerge as a key contributor to the sustainable energy transition. This milestone marks a significant step in our progression toward becoming the next lithium producer in Brazil’s resource-rich Lithium Valley.
Current report
In early October 2024, we announced the discovery of spodumene-rich pegmatites in our Salinas Project area (the “Salinas Project”), located approximately 60 miles north of our flagship Neves Project. The Salinas Project spans 388 hectares (approximately 959 acres) and is situated just five miles east of Latin Resources’ Colina Project, a significant lithium deposit. Our technical team had completed soil geochemistry and LIDAR geological mapping with favorable results and began pursuing further geological and geophysical studies prior to initiating a drilling campaign. Given the positive data collected by us and current market dynamics, the Salinas Project area has emerged as a prime candidate for our future growth plans, though commencing production at our Neves Project area remains our highest priority.
Current report
On October 25, 2024, a voting board comprised of twelve representatives from the local civil society and government unanimously approved our operational permit application for our Neves Project. The permit was formally issued and published in the official gazette of the Minas Gerais government on October 26, 2024. The permit authorizes us to assemble and operate our lithium processing plant, process mined ore from one of our deposits at the facility, and sell the lithium concentrate that it produces. This key development came after an extensive technical review process by regulatory agencies that began with our initial permit application on September 1, 2023. The triphasic permit obtained by us is the most expeditious licensing modality available as it encompasses the initial, installation, and operating licenses all within this same issued authorization (known as “LP/LI/LO” in the local regulatory terminology).
Current report
In November 2024, we outlined our medium to long-term regional growth strategy within Brazil’s Lithium Valley (“LV”), locally known as the Jequitinhonha River Valley. We announced that we had assembled Brazil’s largest portfolio of lithium mineral rights among publicly listed companies, with three key projects spanning the major lithium-mineralized zones: the Neves Project in southern LV, our flagship development which has recently been permitted and is advancing toward production; the Clear Project in central LV, encompassing 470 acres situated 3.8 miles from Sigma Lithium’s mine, where detailed geological mapping has resulted in the discovery of two pegmatites and completed soil sampling revealed a substantial northeast-southwest trending lithium anomaly; and the Salinas Project in northern LV, spanning 2,070 acres with natural spodumene outcrops located 4.7 miles from Latin Resources Ltd. Our strategic approach prioritizes the Neves Project for initial production while simultaneously advancing exploration at the Clear and Salinas Projects.
Current report
In December 2024, we strengthened our leadership team with two strategic appointments aimed at accelerating our production readiness. Eduardo Queiroz joined as Project Management Officer and Vice President of Engineering, bringing over 20 years of experience managing complex, large-scale mining projects. His most recent role was as General Manager of Planning and Management at Bamin, a unit of Eurasian Resources Group, where he successfully led the strategic planning of several projects over US$3 billion, including an integrated iron ore mining project encompassing mining operations, processing plant, railway, and ocean port facilities. Additionally, we expanded our global presence by appointing Lili Wu as Head of Business Development for Asia. Based in Beijing, Ms. Wu brings extensive knowledge and network in the lithium and battery materials industries, with prior roles at InsightWoo and IHS Markit (now part of S&P Global). Her appointment is particularly strategic as China’s electric vehicle sales demonstrated 51% year-over-year growth as of November 2024.
Current report
In February 2025, we achieved a significant milestone with the successful shipment of our modular dense media separation (DMS) lithium processing plant from South Africa to Brazil. The shipment, consisting of 141 containers and 10 bulk items, departed the Port of Durban on February 2, 2025, and arrived at the Port of Santos, Brazil, on March 7, 2025. The newly manufactured processing facility is fully paid and wholly owned by us and a cornerstone of our Neves Project, is designed to deliver high-quality lithium concentrate to the global market for electric vehicles (EVs) and renewable energy storage systems. The plant incorporates cutting-edge and environmentally conscious design features, including a compact, modular design for efficient transportation and installation, optimized physical footprint to minimize environmental impact while ensuring high operational efficiency, advanced water conservation through internal recycling systems, and sustainable tailings management using dry-stacking technology that eliminates the need for tailings dams. This development marked another critical step in our progression toward becoming the next lithium producer in Brazil’s resource-rich Lithium Valley. We believe that our operations in Brazil’s Lithium Valley will benefit from significant strategic advantages, including competitive production costs and high-quality spodumene, positioning us well to meet demand for premium-grade lithium concentrate, particularly from Asian markets where electric vehicle adoption continues to accelerate.
Current report
We have engaged SGS Canada Inc. to produce a definitive feasibility study (as such term is defined under Regulation S-K Item 1300) with respect to our Neves Project. We expect such study to be completed around mid-year 2025.
Current report
After a trial mining period in the second half of 2023, one of our subsidiaries commenced ongoing operations at its quartzite quarry in 2024. Our gross margin of $265,694 was generated from the sales of 551 m 3 of unprocessed blocks of quartzite and 905 m 2 of processed slabs produced by our subsidiary’s quartzite operation. By comparison, there was no gross margin generation in the year ended December 31, 2023.
Current report
Other expenses for the year ended December 31, 2024 totaled $1,338,370 compared to $194,175 during the year ended December 31, 2023, representing an increase of 589%, driven by the derecognition of a $1.3 million asset relating to the premium paid for an option to acquire two mining rights in Governador Valadares, Minas Gerais, and the corresponding recognition of a $1.3 million expense. We decided not to exercise such option and derecognized the amount recorded for the premium occurred because the results of geological studies did not achieve the expected results. The assets subject to the option are unrelated to the Company’s Das Neves Project.
Current report
Net cash provided by financing activities totaled $32,131,672 for the year ended December 31, 2024, compared to $43,156,759 during the year ended December 31, 2023, representing a decrease in cash provided of $11,025,087, or 26%. We completed the following financing activities in 2024:
Current report
Offtake and Sales Agreements
Current report
On March 27, 2024, In connection with the closing of a registered offering of our common stock to Mitsui (the “Mitsui Registered Offering”), our subsidiary Atlas Brazil and Mitsui entered into an Offtake and Sales Agreement, pursuant to which Atlas Brazil agreed to sell and deliver to the Mitsui, and Mitsui agreed to purchase and take delivery of, (i) the spot quantity of fifteen thousand (15,000) dry metric tons of Atlas Brazil’s product, and, subject to the fulfillment of certain conditions precedent, (ii) up to sixty thousand (60,000) dry metric tons of Atlas Brazil’s product for each year, up to a total of three hundred thousand (300,000) dry metric tons. For more information about the Mitsui Registered Offering, please see*“Note 7 – Related Party Transactions.*”
Current report
Trade Receivables
Current report
Trade receivables represent amounts to be received from clients due to the sale of quartzite products. We recognize a trade receivable following the recognition of revenue when control of a product is transferred to the customer, and we have an unconditional right to receive payment for such product.
Current report
The receivable is initially recognized at fair value, which usually corresponds to the price of the transaction (invoice), and such receivable is subsequently assessed to determine the recoverability of the amounts as of each balance sheet date.
Current report
Inventories
Current report
We value our inventories in accordance with Accounting Standards Codification (“ASC”) 330, Inventory (“ASC 330”), which requires that inventories be valued at the lower of cost or market. The cost of inventories is determined using the weighted average cost method.
Current report
Costs of exploration, carrying and retaining unproven mineral lease properties are expensed as incurred, up to the stage at which the commercial and economic feasibility of the mineral properties are proved. After the feasibility is determined, exploration costs are capitalized as incurred.
Current report
Proceeds received on the sale of interests in exploration and evaluation assets are credited to the incurred exploration and evaluation expenditures, with any excess included in operations. Write-downs due to impairment in value are charged to profit or loss.
Current report
Mineral properties are amortized throughout the life of the property based on a units-of-production method.
Current report
In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The amendments in this update require disclosure, in the notes to financial statements, of specified information about certain costs and expenses. The amendments in this update are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. We will analyze the impacts of this update in the upcoming years and anticipate that we will not adopt the update early.
Current report
In November 2024, the FASB issued ASU 2024-04, Debt—Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments. The Board issued this update to improve the relevance and consistency in application of the induced conversion guidance in Subtopic 470-20, Debt— Debt with Conversion and Other Options. The amendments in this update clarify the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. The amendments in this update are effective for all entities for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. Early adoption is permitted for all entities that have adopted the amendments in Update 2020-06. Management does not expect this new guidance to have any impact on our consolidated financial statements.
Removed paragraphs (56)
Previous report
We are primarily focused on advancing and developing our hard-rock lithium project located in the state of Minas Gerais, Brazil. Our Minas Gerais Lithium Project (“MGLP”) is our largest project and consists of 85 mineral rights spread over approximately 468 km 2 and predominantly located within the Brazilian Eastern Pegmatitic Province which has been surveyed by the Brazilian Geological Survey and is known for the presence of hard rock formations known as pegmatites which contain lithium-bearing minerals such as spodumene and petalite.
Previous report
We believe that we can increase our value by continuing of our exploratory work and quantification of our lithium mineralization as well as by expanding our exploration campaign to new, high-potential areas within our portfolio of mineral rights. Our initial commercial goal is to be able to enter production of lithium concentrate, a product which is highly sought after in the battery supply chain for electric vehicles.
Previous report
We also have 100%-ownership of early-stage projects and properties in other minerals that are needed in the battery supply chain and high technology applications such as nickel, copper, rare earths, graphite, and titanium. We believe that the shift from fossil fuels to battery power may yield long-term opportunities for us not only in lithium but also in such other minerals.
Previous report
In addition to these projects, we own 58.71% of the shares of common stock of Apollo Resources, a private company primarily focused on the development of its initial iron mine.
Previous report
We also own approximately 27.42% of the shares of common stock of Jupiter Gold, a company focused on the exploration of two gold projects and a quartzite mine, and whose common stock are quoted on the OTCQB marketplace under the symbol “JUPGF.” The quartzite mine started preliminary operations in June 2023.
Previous report
The results of operations from both Apollo Resources and Jupiter Gold are consolidated in our financial statements under U.S. GAAP.
Previous report
Lithium Exploration Campaign
Previous report
Our ongoing drilling campaign is delineating the lithium resources of our 100%-owned Neves Project, a cluster of four lithium mineral rights within MGLP. Our current geological team is comprised of 16 geologists, all of whom are full-time employees. To support the work of our geologists we have 13 full-time field and support technicians and machinery operators, as well as 3 trainee technicians and over 19 field assistants. Our geological team and our exploration campaign is supervised by James Abson, a Qualified Person for lithium as such term is defined in Subpart 1300 of Regulation S-K promulgated by the SEC (“Regulation S-K 1300”). Mr. Abson was appointed as our Chief Geology Officer in October 2023 and has over 29 years of diverse experience in mining and mineral exploration.
Previous report
Under Mr. Abson’s leadership, our technical team adopted a systematic approach to exploration of additional potential target areas within the Neves Project. These efforts involve geological mapping, sampling of historical artisanal mining sites and exposed pegmatites to analyze potassium-rubidium ratios, as well as soil sampling using both XRF and ICP testing for both LCT pathfinders and Li. Geophysical surveys, including magnetics, are used when warranted to pinpoint additional pegmatite deposits and related structures. Deep trenching of anomalous areas is used to identify and confirm lithium-cesium-tantalum (LCT) pegmatites and estimate width, strike, dip and mineralization prior to drilling. Finally, scout drilling is aimed at testing the highest priority pegmatite targets that appear widest and most mineralized. Within Neves Project area, four confirmed pegmatite bodies with spodumene mineralization were identified (designated as Anitta 1 through 4) with six other target areas remaining open to further exploration.
Previous report
Expanding beyond the Neves Project area, our regional exploration is now centered on the other mineral rights for lithium within the broader Minas Gerais Lithium Project (“MGLP”), a large footprint of 468 km 2 of lithium mineral claims, many of which are located in Brazil’s Lithium Valley, a well-known hard-rock lithium district. A specialized exploration geology team has been assembled to initiate reconnaissance work across this wider land package. Initial efforts involve LiDAR and geological mapping with a specific focus on historical artisanal mining sites, sampling of known and previously identified pegmatites, as well as first-pass soil sampling lines and geophysics to identify anomalies. This phased approach has systematically advanced regional prospecting across our mineral rights in MGLP with a number of targets generated for further exploration by our exploration team.
Previous report
We have engaged SGS Canada Inc. (“SGS”), and, in particular, their geologist Marc-Antoine Laporte, a Qualified Person for lithium under Regulation S-K 1300, to produce a mineral resource estimate report (the “Maiden Resource Report”) for our Neves Project in accordance with Regulation S-K 1300. Mr. Laporte is the author of mineral resource reports for two other companies which have hard-rock lithium projects in Lithium Valley, the general area where our Neves Project is located, and has worked on lithium properties in Lithium Valley since 2017. Mr. Laporte visited our Neves Project between May 4 and May 6, 2023.
Previous report
On March 19, 2024, our Board appointed Brian Talbot to serve as director on the Board, effective as of April 1, 2024. In addition to joining the Board, Mr. Talbot was also appointed by the Board as our Chief Operating Officer (“COO”), effective as of April 1, 2024. In his capacity as COO, Mr. Talbot will be responsible for both the Company’s development of its lithium mine and processing plant as well as all of its lithium exploration geology program. Mr. Talbot is a qualified person for lithium as such a term is defined in Item 1300 of Regulation S-K.
Previous report
Mr. Talbot has an extensive track record as a technical and operational leader throughout his career with over 30 years of experience in mining operations. In particular, he has extensive experience in DMS (dense media separation) plant development and operation. Most recently, Mr. Talbot was employed by RTEK International DMCC (“RTEK”), a consulting firm that advises lithium developers and producers. From July 2022 to September 2023, Mr. Talbot was the Chief Operating Officer at Sigma Lithium Corporation (“Sigma Lithium”), a Canadian lithium producer with operations in Brazil. At Sigma Lithium, he oversaw the development of that company’s flagship Grota do Cirilo project from construction through commissioning and operations. From 2017 to 2022, Mr. Talbot held positions as General Manager and Head of Australian Operations at Galaxy Resources, now part of Arcadium Lithium PLC, one of the world’s largest fully integrated lithium companies. While at Galaxy Resources, Mr. Talbot was instrumental in increasing the production at Mt. Cattlin (a hard-rock lithium mine in Ravensthorpe, Western Australia) which resulted in record production. From 2015 to 2017, Mr. Talbot was at Bikita Minerals in Zimbabwe, which owns and operates the longest running hard-rock lithium mine in the world. Mr. Talbot holds a bachelor’s degree in chemical engineering with Honors from the University of Witwatersrand, South Africa. Please refer to Part III, Item 10, for further information on Mr. Talbot.
Previous report
Recent geological soil sampling anomalies discovered at our Anitta 1 location have determined that such ore body is larger than initially predicted. A decision was made to extend drilling of the Anitta 1 pegmatite to the east, with several drill holes already yielding further significant and shallow additional spodumene intersects with lithium mineralization confirmed by ultraviolet light testing while the geochemical test results are still pending. We expect that these results will add further volume to the Anitta 1 deposit size, and, most importantly, the lithium-bearing material appears to be relatively close to the surface to permit eventual open pit mining. Under Brian Talbot’s leadership as incoming Chief Operating Officer, the exploration plans for our lithium tenements will be focused to support our early revenue strategy.
Previous report
Figure 1: Core sample from recent drilling at Anitta 1.
Previous report
Figure 2: Anitta 1 sample illuminated by ultraviolet light and showing spodumene mineralization.
Previous report
As of December 31, 2023, we had drilled an aggregate of 72,899 meters.
Previous report
Early-Revenue Strategy
Previous report
On December 4, 2023, we announced implementing an early-revenue strategy. With the well-delineated initial Anitta pegmatites, positive metallurgical test work and well-advanced mining and environmental permits Atlas Lithium’s technical team opted to expedite the production timeline for its 100%-owned Neves Project. This early-revenue strategy targets initial “Phase I” production of spodumene concentrate by the fourth quarter of 2024, ramping up to “Phase II” production in mid-2025. The early-revenue Phase I plant is expected to have a maximum capacity of 150,000 tons per annum of spodumene concentrate.
Previous report
We intend to deploy compacted modular dense media separation (DMS) technology together with contracting the crushing and mining operations. The total capital expenditures, including the initial production and ramp-up is estimated at $49.5 million, which includes the modular DMS plants, tailings management module for dry stacked tailings; engineering, procurement, construction management costs; earthworks and civils; site access upgrade, mining preparation and pre-strip, commissioning and ramp-up. The fabrication of the DMS modules, tailing management module, and associated materials handling equipment is advancing.
Previous report
On February 26, 2024, we announced that the fabrication of the DMS modules, tailing management module, and associated materials handling equipment is progressing on schedule, with delivery to Brazil expected in Q2 2024 and first commissioning and production of high-quality, environmentally sustainable lithium concentrate anticipated in Q4 2024. The manufacturing orders were placed by us in December 2023. By condensing components into modules with significantly reduced footprint and weight versus recent DMS plants, Atlas Lithium plans to streamline installation and commissioning. For example, whereas fully assembled traditional DMS facilities commonly weigh 250-300 tons, the Company’s modular plant is predicted to weigh only approximately 41 tonnes. Modular DMS construction and preassembly are well advanced on the primary 100 tons per hour (tph) module and the secondary 50 tph module. We plan to carry out a full pre-assembly and testing of these two modules before they are shipped to Brazil. We engaged CDM Group as engineering contractor and construction coordinator and ADP Marine & Modular for plant manufacturing, with both of these firms located in South Africa. The manufacturing facility located in South Africa has recently been visited by our technical team and photographs of parts completed and in progress of our modular DMS lithium processing plant under construction can be seen in Figures 3-5 below. Figures 6-8 depict 3-D model views of our planned modular DMS lithium processing plant.
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Figure 3: Our modular DMS lithium processing plant under construction.
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Figure 4: View of part of our DMS lithium processing plant under construction.
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Figure 5: View of part of our modular DMS lithium processing plant under construction.
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Figure 6: View of 3-D model of our planned DMS lithium processing plant.
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Figure 7: Additional view of 3-D model of our planned DMS lithium processing plant.
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Figure 8: Additional view of 3-D Model of our planned DMS lithium processing plant.
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Drilling Campaign Highlights (drill holes sorted by location)
Previous report
Shown below are the results from our ongoing Neves Project drilling campaign, which include certain results obtained after December 31, 2023.
Previous report
Our drilling and sampling follow strict best practices established under industry-standard quality assurance and quality control protocols. All lithium samples are analyzed at SGS-Geosol, an established analytical laboratory used by mining companies in Brazil. Normally geochemical results are obtained from SGS-Geosol three weeks after submission of the samples for analysis.
Previous report
Metallurgical Report
Previous report
On April 24, 2023, we announced the receipt of the metallurgical report (the “Metallurgical Report”) from SGS-Geosol for studies performed over several months on a representative ore sample from our Neves Project. The Metallurgical Report showed that a very high grade of 7.22% was achieved for heavy liquid separation. Commercial-grade lithium concentrate was obtained from our representative sample using standard dense media separation, a gravity-based approach which does not use any harmful chemicals or flotation. The Metallurgical Report also showed final lithium concentrate grading of 6.04% Li 2 O with only 0.53% Fe 2 O 3, and a lithium recovery of 70%. Our desired target was the production of concentrate grading 6.0% Li 2 O with less than 1.0% Fe 2 O 3, and these targets were exceeded.
Previous report
The Metallurgical Report will become a chapter in the Maiden Resource Report described above. The Metallurgical Report also allows SGS-Geosol to begin work towards a Preliminary Economic Assessment of the Neves Project which is a technical study expected to be issued after the Maiden Resource Report.
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Business Development Update
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Mitsui & Co., Ltd.
Previous report
On January 18, 2023, we announced that we had signed a non-binding, non-exclusive Memorandum of Understanding (“MOU”) with Mitsui & Co., Ltd. (“Mitsui”) with respect to Mitsui’s potential interest in acquiring the right to purchase our future lithium concentrate production. In November 2023, we entered into the Chengxin and Yahua agreements, described below, at which time we ceased discussions with Mitsui regarding a potential offtake arrangement as contemplated by the MOU. We have continued discussions with Mitsui regarding other possible strategic opportunities and/or partnerships.
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Lithium Royalty Corp. Royalty Agreement
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On May 2, 2023, our 99.9% owned subsidiary, Atlas Litio Brasil Ltda. (“Atlas Brasil”), entered into a written agreement pursuant to which it sold a royalty interest equaling 3% of the future gross revenue from the sale of products from certain 19 mineral rights and properties owned by Atlas Brasil and located in Brazil, to Lithium Royalty Corp., a Canadian company listed on the Toronto Stock Exchange (“LRC”), for $20,000,000 in cash.
Previous report
The royalty will be calculated, and royalty payment will be made, on a quarterly basis commencing from the first receipt of the sales proceeds with respect to the products. Atlas Brasil also granted LRC an option to purchase additional royalty interests with respect to certain additional Brazilian mineral rights and properties on the same terms and conditions, at a total purchase price of $5,000,000.
Previous report
Chengxin and Yahua Agreements
Showing the first 40 of 56 passages. Open the source sections for the rest.
Reworded paragraphs (17)
Previous wording
We are building a modular plant targeted at producing 150,000 tons of lithium concentrate per annum (“tpa”) in what we describe as Phase I. We plan on adding additional modules to the plant with the intent of doubling its production capacity to 300,000 tpa in Phase II. However, there can be no assurance that we will have the necessary capital resources to develop such facility or, if developed, that we will reach the production capacity necessary to commercialize our products and with the quality needed to meet market demand.
Current wording
However, there can be no assurance that we will have the necessary capital resources to develop such a facility or, if developed, that we will reach the production capacity necessary to commercialize our products and with the quality needed to meet market demand.
Previous wording
In addition, we also have a few additional mineral rights in the process of being acquired and not yet titled in our name. We believe that we hold the largest portfolio of exploration properties for lithium and other battery minerals in Brazil.
Current wording
We believe that we hold the largest portfolio of exploration properties for lithium and other battery minerals in Brazil among publicly listed companies.
Previous wording
Operating expenses for the year ended December 31, 2023, totaled $42,588,044, compared to operating expenses of $5,446,984 during the year ended December 31, 2022, representing an increase of 682%. The increase was mostly due to increases in general and administrative expenses, stock-based compensation expense and exploration expenses, as described below.
Current wording
Operating expenses for the year ended December 31, 2024, totaled $44,123,939, compared to operating expenses of $42,106,732 during the year ended December 31, 2023, representing an increase of 4,8%. The increase was mostly due to increases in general and administrative expenses and stock-based compensation expense, offset by a reduction in exploration expenses, as detailed below:
Previous wording
As a result, we incurred a net loss attributable to our stockholders of $41,393,525, or $4.11 per share, for the year ended December 31, 2023, compared to a net loss attributable to our stockholders of $4,628,520, or $1.00 per share, during the year ended December 31, 2022.
Current wording
As a result, we incurred a net loss attributable to our stockholders of $42,241,196, or $2.97 per share, for the year ended December 31, 2024, compared to a net loss attributable to our stockholders of $40,768,275, or $4.37 per share, during the year ended December 31, 2023.
Previous wording
Net cash used in operating activities totaled $5,029,318 for the year ended December 31, 2023, compared to net cash used of $1,480,530 during the year ended December 31, 2022, representing an increase in cash used of $3,548,788, or 240%. The increase was primarily due to the net loss in the period offset by proceeds from the sale of future royalties.
Current wording
Net cash used by operating activities totaled $18,784,844 for the year ended December 31, 2024, compared to net cash used of $5,962,602 during the year ended December 31, 2023, representing an increase in cash used of $12,822,242, or 215%. The variation in net cash used by operating activities was mainly due to:
Previous wording
Net cash used in investing activities totaled $7,082,467 for the year ended December 31, 2023, compared to net cash used of $2,846,356 during the year ended December 31, 2022, representing an increase in cash used of $4,236,111, or 149%. The increase is mainly due to cash advances for the lithium processing plant construction during 2023.
Current wording
Net cash used in investing activities totaled $27,344,436 for the year ended December 31, 2024, compared to net cash used of $7,970,172 during the year ended December 31, 2023, representing an increase in cash used of $19,374,264, or 243%. The variation in net cash used by investing activities was mainly due to:
Previous wording
We have historically incurred net operating losses and have not yet received material revenues from the sale of products or services. As a result, our primary sources of liquidity have been derived through proceeds from the (i) sales of our equity and the equity of one of our subsidiaries, and (ii) issuance of convertible debt. As of December 31, 2023, we had cash and cash equivalents of $29,549,927 and working capital of $24,044,931, compared to cash and cash equivalents $280,525 and a working capital deficit of $2,452,553 as of December 31, 2022. We believe our cash on hand will be sufficient to meet our working capital and capital expenditure requirements for a period of at least twelve months through March 2025. However, our future short- and long-term capital requirements will depend on several factors, including but not limited to, the rate of our growth, our ability to identify areas for mineral exploration and the economic potential of such areas, the exploration and other drilling campaigns needed to verify and expand our mineral resources, the types of processing facilities we would need to install to obtain commercial-ready products, and the ability to attract talent to manage our different areas of endeavor. To the extent that our current resources are insufficient to satisfy our cash requirements, we may need to seek additional equity or debt financing. If the needed financing is not available, or if the terms of financing are less desirable than we expect, we may be forced to scale back our existing operations and growth plans, which could have an adverse impact on our business and financial prospects and could raise substantial doubt about our ability to continue as a going concern.
Current wording
The consolidated financial statements have been prepared on a going concern basis. We have historically incurred net operating losses and have not yet received material revenues from the sale of products or services. As a result, our primary source of liquidity has been the proceeds from the sale of our equity. As of December 31, 2024, we had cash and cash equivalents of $15,537,476 and net working capital of $12,258,774, compared to cash and cash equivalents $29,549,927 and a working capital deficit of $23,809,637 as of December 31, 2023. We believe our cash on hand will be sufficient to meet our working capital and capital expenditure requirements for a period of at least twelve months. However, our future short- and long-term capital requirements will depend on several factors, including but not limited to, the rate of our growth, our ability to identify areas for mineral exploration and the economic potential of such areas, the exploration and other drilling campaigns needed to verify and expand our mineral resources, the types of processing facilities we would need to install to obtain commercial-ready products, and the ability to attract talent to manage our different areas of endeavor. To the extent that our current resources are insufficient to satisfy our cash requirements, we may need to seek additional equity or debt financing. If the needed financing is not available, or if the terms of financing are less desirable than we expect, we may be forced to scale back our existing operations and growth plans, which could have an adverse impact on our business and financial prospects and could raise substantial doubt about our ability to continue as a going concern.
Previous wording
On November 29, 2023, we entered into Offtake and Sales Agreements (the “Offtake Agreements”) with each of Sichuan Yahua Industrial Group Co., Ltd. and Sheng Wei Zhi Yuan International Limited, a subsidiary of Shenzhen Chengxin Lithium Group Co., Ltd., pursuant to which we agreed, for a period of five years, to sell to each of the buyers 60,000 dry metric tons of lithium concentrate per year, subject to our ability to increase or decrease such quantity by up to ten percent (10%) each year. The price for the lithium concentrate is determined according to a formula as set forth in the Offtake Agreements. Each of the buyers agreed to invest $5 million into shares of our common stock at $29.77, and when we receive final permits, to invest an additional $20 million as offtake pre-payment for future deliveries of the lithium concentrate after we obtain customary licenses. Each pre-payment amount will be used to offset the buyer’s future payment obligations under the Offtake Agreements.
Current wording
In December 2023, we entered into Offtake and Sales Agreements with each of Sichuan Yahua Industrial Group Co., Ltd. and Sheng Wei Zhi Yuan International Limited, a subsidiary of Shenzhen Chengxin Lithium Group Co., Ltd., pursuant to which we agreed, for a period of five (5) years, to sell to each buyer 60,000 dry metric tonnes of lithium concentrate (the “Product”) per year, subject to our authority to increase or decrease such quantity by up to ten percent (10%) each year. Each of the buyers agreed that upon the Company reaching certain milestones, including the obtaining of customary licenses, to pre-pay to the Company $20.0 million (each, a “Pre-Payment Amount”) for future deliveries of the Product after we obtain customary licenses. Each Pre-Payment Amount when made will be used to offset against such buyers’ future payment obligations for the Product.
Previous wording
The discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with the accounting principles generally accepted in the United States of American (“U.S. GAAP”). Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. These estimates and assumptions are affected by management’s application of accounting policies. We believe that understanding the basis and nature of the estimates and assumptions involved with the following aspects of our financial statements is critical to an understanding of our financial statements.
Current wording
The discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with U.S. GAAP. Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. These estimates and assumptions are affected by management’s application of accounting policies. We believe that understanding the basis and nature of the estimates and assumptions involved with the following aspects of our financial statements is critical to an understanding of our financial statements.
Previous wording
The processing plant and other machinery are depreciated over an estimated useful life of ten years; vehicles are depreciated over an estimated life of five years; and computer and other office equipment over an estimated useful life of five years.
Current wording
The processing plant and other machinery are depreciated over an estimated useful life of ten years; vehicles are depreciated over an estimated life of five years; and computers and other office equipment are depreciated over an estimated useful life of five years.
Previous wording
Costs of exploration, carrying and retaining unproven mineral lease properties are expensed as incurred. Mineral property acquisition costs, including licenses and lease payments, are capitalized. Although we have taken steps to verify title to mineral properties in which it has an interest, these procedures do not guarantee our rights. Such properties may be subject to prior agreements or transfers and title may be affected by undetected defects.
Current wording
Mineral property acquisition costs, including licenses and lease payments, are capitalized. Although we have taken steps to verify title to mineral properties in which we have an interest, these procedures do not guarantee our rights. Such properties may be subject to prior agreements or transfers and title may be affected by undetected defects.
Previous wording
Application of impairment tests requires significant management judgment, including the determination of fair value of each indefinite-lived intangible asset. Judgment applied when performing the qualitative analysis includes consideration of macroeconomic, industry and market conditions, overall financial performance of the entity, composition, or strategy changes affecting the recoverability of asset groups. Judgments applied when performing the quantitative analysis includes estimating future cash flows, determining appropriate discount rates and making other assumptions. Changes in these judgments, estimates and assumptions could materially affect the determination of fair value for each indefinite-lived intangible asset.
Current wording
Application of impairment tests requires significant management judgment, including the determination of fair value of each indefinite-lived intangible asset. Judgment applied when performing the qualitative analysis includes consideration of macroeconomic, industry and market conditions, overall financial performance of the entity, composition, or strategy changes affecting the recoverability of asset groups. Judgments applied when performing the quantitative analysis include estimating future cash flows, determining appropriate discount rates and making other assumptions. Changes in these judgments, estimates and assumptions could materially affect the determination of fair value for each indefinite-lived intangible asset.
Previous wording
We have concluded that Apollo Resources, Jupiter Gold and their subsidiaries are VIEs in accordance with applicable accounting standards and guidance; and although the operations of Apollo Resources and Jupiter Gold are independent of ours, because our chief executive officer, Marc Fogassa, is also the controlling shareholder of both Apollo Resources and Jupiter Gold, we may be considered to have power to direct the activities that are most significant to Apollo Resources and Jupiter Gold. Therefore, we concluded that we are the primary beneficiary of both Apollo Resources and Jupiter Gold.
Current wording
We have concluded that Atlas Critical Minerals and its subsidiaries are VIEs in accordance with applicable accounting standards and guidance; and although the operations of Atlas Critical Minerals are independent of ours, because our Chief Executive Officer and Chairman, Mr. Fogassa, is also the controlling shareholder of Atlas Critical Minerals, we may be considered to have power to direct the activities that are most significant to Atlas Critical Minerals. Therefore, we concluded that we are the primary beneficiary of Atlas Critical Minerals.
Previous wording
We measure and records stock-based compensation expense in accordance with ASC Topic 718 for share-based payments related to stock options, restricted stock, and performance-based awards granted to certain directors, employees and consultants. ASC 718 requires companies to measure compensation cost for stock-based employee compensation at fair value at the grant date and recognize the expense over the employee’s requisite service period. Under ASC 718, volatility is based on the historical volatility of our stock or the expected volatility of the stock of similar companies. The expected life assumption is primarily based on historical exercise patterns and employee post-vesting termination behavior. The risk-free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant.
Current wording
We measure and record stock-based compensation expense in accordance with ASC Topic 718 for share-based payments related to stock options, restricted stock, and performance-based awards granted to certain directors, employees and consultants. ASC 718 requires companies to measure compensation cost for stock-based employee compensation at fair value at the grant date and recognize the expense over the employee’s requisite service period. Under ASC 718, volatility is based on the historical volatility of our stock or the expected volatility of the stock of similar companies. The expected life assumption is primarily based on historical exercise patterns and employee post-vesting termination behavior. The risk-free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant.
Previous wording
Our foreign subsidiaries use a local currency as the functional currency. Resulting translation gains or losses are recognized as a component of accumulated other comprehensive income. Transaction gains or losses related to balances denominated in a currency other than the functional currency are recognized in the consolidated statements of operations. Net foreign currency transaction losses included in our consolidated statements of operations were negligible for all periods presented.
Current wording
With the exception of Atlas Lítio Brasil Ltda, our foreign subsidiaries use a local currency as the functional currency. Resulting translation gains or losses are recognized as a component of accumulated other comprehensive income. Transaction gains or losses related to balances denominated in a currency other than the functional currency are recognized in the consolidated statements of operations. Net foreign currency transaction losses included in our consolidated statements of operations were negligible for all periods presented.
Previous wording
In August 2023, the FASB issued ASU 2023-05, Business Combinations - Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement, which clarifies the business combination accounting for joint venture formations. The amendments in the ASU seek to reduce diversity in practice that has resulted from a lack of authoritative guidance regarding the accounting for the formation of joint ventures in separate financial statements. The amendments also seek to clarify the initial measurement of joint venture net assets, including businesses contributed to a joint venture. The guidance is applicable to all entities involved in the formation of a joint venture. The amendments are effective for all joint venture formations with a formation date on or after January 1, 2025. Early adoption and retrospective application of the amendments are permitted. We do not expect adoption of the new guidance to have a material impact on our consolidated financial statements and disclosures.
Current wording
In August 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-05, Business Combinations - Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement, which clarifies the business combination accounting for joint venture formations. The amendments in the ASU seek to reduce diversity in practice that has resulted from a lack of authoritative guidance regarding the accounting for the formation of joint ventures in separate financial statements. The amendments also seek to clarify the initial measurement of joint venture net assets, including businesses contributed to a joint venture. The guidance is applicable to all entities involved in the formation of a joint venture. The amendments are effective for all joint venture formations with a formation date on or after January 1, 2025. Early adoption and retrospective application of the amendments are permitted. We do not expect the adoption of the new guidance to have a material impact on our consolidated financial statements and disclosures.
Previous wording
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvement to Income Tax Disclosures, amending income tax disclosure requirements for the effective tax rate reconciliation and income taxes paid. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024, and are applied prospectively. Early adoption and retrospective application of the amendments are permitted. We are currently evaluating the impact of this update on our consolidated financial statements and disclosures.
Current wording
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvement to Income Tax Disclosures, amending income tax disclosure requirements for the effective tax rate reconciliation and income taxes paid. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024, and are applied prospectively. Early adoption and retrospective application of the amendments are permitted. We do not expect the adoption of the new guidance to have a material impact on our consolidated financial statements and disclosures.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
As of December 31, 2024, we had cash and cash equivalents of $15,537,476 and net working capital of $12,258,774.