- Five-year offering, the company’s inaugural convertible bond
- Primary use of net proceeds to repay senior secured debt with Synergy Capital
- Lowers cash interest costs enabling the company to build operating cash flow
- Sets healthy conversion premium of 25% to the reference price
Sigma Lithium Corporation (ASX: SAU) – the largest producer of industrial-mineral lithium oxide concentrate in the Americas – is shoring up its financial position with a US$100 million offering of senior unsecured convertible bonds.
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The offering, the company’s first convertible bond issuance, refinances Sigma Lithium’s largest near-term debt obligation and aligns its debt profile with the planned production expansion.
The senior secured debt with Synergy Capital matures in June 2027, following a maturity extension announced on October 23, 2026.
The maiden bond offering is convertible at a 25% premium into CHESS Depositary Interests over common shares in the company.
The offering significantly lengthens the recently extended maturity from June 2027 to 2031, reducing short-term debt by approximately 80%, from US$125 million on a pro forma basis.
It also moves the earliest repayment date to 2029 and final maturity to 2031.
Sigma also announced a preview of selected preliminary, unaudited results for the quarter ended September 30, 2026, and operational metrics for the current 4Q 26.
The company produced 7,293 tonnes of lithium oxide concentrate in 3Q 26. Production was impacted by a suspension of operations by local authorities during the quarter. In early 4Q 26, Sigma Lithium was granted protection of its operating and mining licenses by State and Federal Courts and production was restarted. The proceedings remain before the Brazilian judiciary, and Sigma Lithium continues to pursue the appropriate legal remedies.
Since restarting production, the vompany has produced 9,000 tonnes of high-grade concentrate in 4Q 26 to October 30, 2026. A further 21,000 tonnes of additional inventory from 3Q 26 is available for sale in 4Q 26, comprising 15,000 tonnes of low-grade material (in high-grade equivalent tonnes) and 6,000 tonnes of intermediate products. Plant 1 remains on track to return to industrial production cadence in 2027.
Sigma maintained a 32% gross margin in 3Q 26 despite significantly lower volumes. Plant gate cash cost was US$424/t, in line with 3Q 25 and up 6.0% on 2Q 26 (US$401/t).
FY26 AISC guidance has been reduced by 6,0%, to US$668/t from US$710/t. FY27 AISC guidance of US$620/t remains on track.
The company’s position in cash and equivalents was US$10 million as of September 30, 2026. During the quarter, cash inflows of US$19 million, including prepaid instalments on high-grade sales, were more than offset by operating costs and capex, which totalled US$26 million.
Potential sources of short-term liquidity after September 30, 2026, total up to US$62 million: comprising US$10 million in receivables from high-grade sales, US$20 million in unsold low-grade inventory, and US$32 million in outstanding instalments under the US$96 million offtake agreement.
SAU was steady at 1.4c with a Mkt cap CAD$809.36 million.
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