Largo Inc.

Unaudited Condensed Interim Consolidated Financial Statements

For the Three and Six Months Ended June 30, 2026 and 2025

(Expressed in thousands / 000's of U.S. dollars)

Table of Contents

Unaudited Condensed Interim Consolidated Statements of Financial Position

Unaudited Condensed Interim Consolidated Statements of Income (Loss) and Comprehensive Income (Loss)

Unaudited Condensed Interim Consolidated Statements of Changes in Equity

Unaudited Condensed Interim Consolidated Statements of Cash Flows

1) Nature of operations and going concern

Largo Inc. ("the Company" or "Largo") is a producer and supplier of vanadium products, which are sourced from the Company's Maracás Menchen Mine located in Brazil. The Company is also focused on the newly established joint venture, Storion Energy LLC ("Storion").

The Company is a corporation governed by the Business Corporations Act (Ontario) and domiciled in Canada whose shares are listed on the Toronto Stock Exchange ("TSX") and on the Nasdaq Stock Market ("Nasdaq"). The head office, principal address and records office of the Company are located at 100 King Street West, Suite 1600, Toronto, Ontario, Canada M5X 1G5.

These unaudited condensed interim consolidated financial statements have been prepared on a going concern basis. The going concern basis of presentation assumes the Company will continue in operation for the foreseeable future and can realize its assets and discharge its liabilities in the normal course of business. In making the assessment that the Company is a going concern, management has taken into account all available information about the future, which is at least, but not limited to, 12 months from June 30, 2026.

The Company incurred a net loss of $27,465 for the six months ended June 30, 2026 (six months ended June 30, 2025 - $14,957) and had a working capital deficit (current assets less current liabilities) of $79,269 (December 31, 2025 - deficit of $75,883), which includes $114,249 (December 31, 2025 - 107,066) in debt maturing within the next twelve months.

The Company has experienced declining operating results and cash flows over the past three years, primarily due to lower vanadium prices and operational challenges. Although the Company has implemented an operational turnaround program and cost optimization initiatives, these measures have not yet fully offset the impact of the sustained weakness in vanadium prices. Since December 31, 2023, vanadium prices have declined by approximately 8%, significantly affecting the Company's operating cash flows. In addition, ongoing price volatility, influenced by geopolitical and broader market conditions, has continued to place downward pressure on vanadium prices.

In response to operational challenges, the Company has implemented corrective measures to address underlying operational issues and is executing an operational turnaround plan, together with additional cost optimization initiatives at the Maracás Menchen Mine. Management believes these initiatives are necessary to restore operational performance and generate positive cash flows from operating activities.

On June 29, 2026, the Company announced that it had been awarded a five-year contract with the U.S. Department of Defense to supply high-purity vanadium pentoxide through fixed-price delivery orders in support of the U.S. National Defense Stockpile, with a maximum aggregate contract value of $125,000. In July 2026, the Company received its first delivery order under the contract, valued at $60,100, from the U.S. Defense Logistics Agency. The Company has existing production capacity to fulfill the delivery orders under the contract, and no significant additional capital investment or expansion of its processing facilities is required to meet its contractual obligations. Costs associated with fulfilling the delivery orders will be incurred in the normal course of operations.

While these initiatives and commercial developments are expected to improve the Company's financial position and liquidity, material uncertainty remains regarding the Company's ability to generate sufficient cash flows to fund its operating activities and meet its obligations as they become due. The Company's ability to continue as a going concern is dependent on the successful execution of its operational turnaround plan, obtaining additional financing, and/or improved realized prices for its vanadium products. These conditions indicate the existence of a material uncertainty that casts significant doubt on the Company's ability to continue as a going concern.

The Company requires additional financing to repay its liabilities and support its working capital to fund operating activities. The Company is actively pursuing additional financing options to increase its liquidity and capital resources, including, but not limited to, refinancing of its existing debt facilities and obtaining additional debt facilities, which could be provided by banks, private capital providers and/or institutional investors. In addition, in January 2026, the Company established an at-the-market equity offering program (the "ATM Program"). Under this program, the Company may issue and sell common shares from time to time on The Nasdaq Stock Market, with total gross proceeds of up to $60,000 (refer to note 12 and 21). There can be no assurance that the Company will be able to secure sufficient additional funding on terms acceptable to the Company, or at all, be able to issue and sell additional common shares under the ATM Program, or be able to successfully implement strategic alternatives.

Due to the material uncertainties surrounding the Company's ability to raise additional financing to satisfy the repayment of debt maturing within the next twelve months and to support its working capital to fund operating activities, evolving trade uncertainties, future vanadium prices, and the Company achieving positive cash flows within the next twelve months, it is not possible to predict the Company's success in addressing these material uncertainties. These material uncertainties cast substantial doubt about the Company's ability to continue as a going concern.

These  unaudited condensed interim consolidated  financial statements do not include the adjustments to the amounts and classification of assets and liabilities that would be necessary should the Company be unable to continue as a going concern. These adjustments may be material.

2) Statement of compliance

These unaudited condensed interim consolidated financial statements have been prepared in accordance with International Accounting Standard ("IAS") 34, Interim Financial Reporting, and should be read in conjunction with the Group's last annual audited consolidated financial statements as at and for the year ended December 31, 2025 ("last annual financial statements"). They do not include all of the information required for a complete set of financial statements prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"). However, selected explanatory notes are included to explain events are included to explain events and transactions that are significant to an understanding of the changes in the Group's financial position and performance since the last annual financial statements.

The unaudited condensed interim consolidated financial statements were approved by the Board of Directors of the Company on  August 13, 2026.

3) Basis of preparation, material accounting policies, and future accounting changes

The basis of presentation, and accounting policies and methods of their application in these unaudited condensed interim consolidated financial statements, including comparatives, are consistent with those used in the Company's audited annual consolidated financial statements for the year ended December 31, 2025 and should be read in conjunction with those statements.

These unaudited condensed interim consolidated financial statements are presented in thousands of U.S. dollars, unless otherwise noted. References to the symbol "C$" or "CAD" mean the Canadian dollar, references to the symbol "EUR" mean the Euro and references to the symbol "R$" or "BRL" mean the Brazilian real, the official currency of Brazil.

The Company adopted the following IFRS amendments in 2026, which did not have a material effect on these unaudited condensed interim consolidated financial statements.

(a) Adoption of new accounting standards

• Amendments to IFRS 9 and IFRS 7 - Classification and Measurement of Financial Instruments - Effective January 1, 2026, the Company adopted the amendments to IFRS 9, Financial Instruments, and IFRS 7, Financial Instruments: Disclosures. The amendments clarify requirements relating to the derecognition of financial liabilities, including certain transactions settled through electronic payment systems, provide additional guidance for assessing the contractual cash flow characteristics of financial assets, including those with contingent and non-recourse features, and introduce additional disclosure requirements for certain financial instruments.

The adoption of these amendments did not have a material impact on the Company's financial statements.

(b) New accounting standards issued but not effective

• IFRS 18 - Presentation and Disclosure in Financial Statements - In April 2024, the IASB issued IFRS 18, Presentation and Disclosure in Financial Statements, which will replace IAS 1, Presentation of Financial Statements, for annual reporting periods beginning on or after January 1, 2027. IFRS 18 introduces new requirements for the presentation and disclosure of information in the financial statements, with a particular focus on improving comparability of financial performance between entities.

Key requirements of IFRS 18 include: (i) the introduction of defined categories for income and expenses in the statement of profit or loss (operating, investing and financing) and new specified subtotals, including operating profit or loss; (ii) disclosures of management-defined performance measures ("MDPMs") that are communicated outside the financial statements and are related to an entity's financial performance; (iii) enhanced requirements for aggregation and disaggregation of information in both the primary financial statements and the notes; and (iv) limited amendments to the statement of cash flows, including changes to certain presentation requirements that are intended to improve consistency with the statement of profit or loss.

The Company is currently assessing the effects of IFRS 18 on the financial statements.

a) Critical judgements and estimation uncertainties

The preparation of unaudited condensed interim consolidated financial statements requires the Company's management to make judgments, estimates and assumptions about the carrying amount of its assets and liabilities that are not readily apparent from other sources. These estimates and assumptions are disclosed in note 3(d) of the Company's audited annual consolidated financial statements for the year ended December 31, 2025. There have been no significant changes to the areas of estimation and judgment during the three and six months ended June 30, 2026.

4) Amounts receivable

As at June 30, 2026, the Company maintained an expected credit loss allowance of $2,843 (December 31, 2025 - $2,843 ) in relation to its financial assets, in accordance with IFRS 9 - Financial Instruments. The expected credit loss allowance represents the Company's estimate of the potential default risk on its outstanding amounts receivable. The allowance was unchanged from December 31, 2025, and accordingly no additional expected credit loss expense was recognized during the period.

5) Inventory

During the three and six months ended June 30, 2026, the Company recognized net realizable value write-downs of $5,866 and $7,511 for vanadium finished products and stockpiles (three and six months ended June 30, 2025 -  $5,361 and $16,577), $358 and $516 for ilmenite finished products (three and six months ended June 30, 2025 - $350 and $25) and  $1,060 and $1,082 for warehouse materials (three and six months ended June 30, 2025 -  $nil and write-down reversal of $11).

6) Investment in associate

In February 2026, Storion completed a capital raise of $10,000 through the issuance of preferred units, which were determined to be equity instruments in accordance with IAS 32. As a result, the Company's ownership interest in Storion was diluted from 50.00% to 37.37%.

Despite the reduction in its ownership interest and board representation from two nominees to one nominee, the Company concluded that it continues to exercise significant influence over Storion through its remaining Board representation, Special Manager consent rights and participation in key policy-making decisions. Accordingly, the investment continues to be accounted for using the equity method in accordance with IAS 28.

The dilution of the Company's ownership interest resulted in the recognition of a gain on dilution of $2,843 in profit or loss. The gain was determined by comparing the carrying amount of the Company's investment immediately prior to the dilution with the carrying amount of its retained interest following the transaction. The carrying amount was based on the December 31, 2025 audited investment balance, adjusted for the Company's share of Storion's results through February 28, 2026.

The following table summarizes the gain on dilution of investment in associate :

During the three and six months ended June 30, 2026, the Company recognized its share of the associate's loss of $(1,351) and $(2,990) in the consolidated statement of income (loss) and comprehensive income (loss) (three and six months ended June 30, 2025 - $(1,434) and $(2,276)).

The following tables summarize the consolidated financial information of Storion on a 100% basis at June 30, 2026 and December 31, 2025:

7) Other intangible assets

At June 30, 2026, the remaining estimated useful life of capitalized software costs was 1.5 years (December 31, 2025 - 2 years).

8) Mine properties, plant and equipment

At June 30, 2026, the Company's economic interest in the Maracás Menchen Mine totaled 99.95% (December 31, 2025 - 99.95%). The remaining 0.05% economic interest is held by Companhia Baiana de Pesquisa Mineral ("CBPM") owned by the state of Bahia. CBPM retains a 3% net smelter royalty ("NSR") in the Maracás Menchen Mine. The property is also subject to a royalty of 2% on certain operating costs under the Brazilian Mining Act. Under a separate agreement, a third party receives a 2% NSR in the Maracás Menchen Mine.

The recoverable amount of the Mine Properties CGUs was determined by calculating the fair value less costs of disposal ("FVLCD"). The FVLCD was determined by calculating the net present value of the estimated future cash flows (level 3 of the fair value hierarchy). The Company performed impairment test and no impairment was identified for December 31, 2025 and June 30, 2026.

Of the additions noted above, $13,847 related to the Mine Properties segment (year ended December 31, 2025 − $21,126).

9) Accounts payable and accrued liabilities

10) Debt

Credit facilities

In October 2022, the Company secured a debt facility of $20,000 with a bank in Brazil. Following an amendment finalized in June 2023, the facility is for three years, with the principal due to repayment at maturity. In addition to an upfront fee of 0.80%, interest accrued at a rate of 8.51% per year. is to be paid every six months. In October 2025, a principal repayment of $712 was made. Subsequently, an amendment to the agreement was executed, extending the maturity of the remaining balance to September 2026. The amended terms provide for quarterly interest payments at an annual interest rate of 8.51%.

In January 2023, and amended in June 2023, the Company secured a three-year debt facility of $10,000, bearing interest at 8.51% per year. and an upfront fee of 0.80%. The principal is due for repayment at maturity, with interest payments due semi-annually. In October 2025 an amendment to the agreement was executed, extending the maturity of the balance to September 2026. The amended terms provide for quarterly interest payments at an annual interest rate of 8.51%.

In September 2023, the Company secured a $15,000 debt facility with a bank in Brazil. This facility is for three years, with four equal principal repayments due semi-annually after a grace period of 540 days. Accrued interest at a rate of 8.75% per year. is to be paid every six months. In May 2025, the Company extended the due date of the first principal payment from May until August 2025. In August 2025, the Company extended the due date of the first principal payment from August 2025 to October 2025.  In October 2025, a principal repayment of $356 was made. Subsequently, an amendment to the agreement was executed, extending the maturity of the remaining balance to September 2026. The amended terms provide for quarterly interest payments at an annual interest rate of 8.75%.

In October 2023, the Company secured a three-year $20,000 debt facility, bearing interest at 8.95% per year. Interest payments are due quarterly with 50% of the principal to be repaid in October 2025 and 50% to be repaid in October 2026. In October 2025, a principal repayment of $475 was made. Subsequently, an amendment to the agreement was executed, changing the maturity of the installments to September 2026. The amended terms provide for quarterly interest payments at an annual interest rate of 8.95%.

In December 2023, the Company secured a two-year $10,000 debt facility, with the principal due for repayment at maturity. In addition to an upfront fee of 0.85%, accrued interest at a rate of 10.45% per year. is to be paid at maturity. In October 2025, a principal repayment of $237 was made. Subsequently, an amendment to the agreement was executed, extending the maturity of the remaining balance to September 2026. The amended terms provide for quarterly interest payments at an annual interest rate of 10.45%.

In May 2024, the Company secured a working capital debt facility with a bank in Brazil for a total limit of $8,000. Drawdowns on the facility were repayable in 90 days together with accrued interest at a rate of 8.25% per year, with renewals subject to approval by the bank. On May 10, 2024, the Company received $7,813 from this facility and it was repaid in full in August 2024. In September 2024, the facility was amended to a total limit of R$50,000 with drawdowns repayable in 120 days together with accrued interest at a rate of 9.00% per year. On September 30, 2024, the Company received R$50,000 ($9,235) from this facility. In January 2025, the term was extended for a further 120 days with no change in the interest rate. In May 2025, the Company extended the term for a further 120 days with accrued interest at a rate of 9.05% per year. In September 2025, the Company extended the term for one year with accrued interest at a rate of 9.05% per year.

In June, 2024, the Company entered into an inventory financing agreement for up to $10,000. Under this facility, the Company may use its finished vanadium products inventory as collateral to obtain drawdowns of up to $10,000 for periods of up to 100 days. Repayments include a 1% commission fee, interest at the one-month U.S. Secured Overnight Financing Rate (SOFR) plus 3.0%, and other direct costs. The Company began utilizing the facility in July 2024. In October 2025, the facility was amended. Under the amended agreement, the total financing limit increased to up to $35,000, consisting of $25,000 secured by inventory and $10,000 secured by customer receivables. The inventory financing commission is charged at 3% on the sales invoice value. The contract ended on December 31, 2025. At  June 30, 2026, financing remains outstanding in respect of advances made prior to the expiry of the arrangement. These balances continue to be settled in accordance with the contract terms.

In July 2024, the Company entered into an additional inventory financing agreement for up to $10,000. The facility, which matures on June 30, 2026, allows the Company to use its finished vanadium products inventory as collateral to obtain drawdowns of up to $10,000 for periods of up to 90 days. Repayments include a 1% commission fee, interest, and other direct costs. As of December 31, 2025, all advances had been repaid, and there were no outstanding amounts under the facility. The contract ended on December 31, 2025. 

In August 2025, the Company secured a loan facility for a principal amount of $6,000. This facility is secured against the Company's equity interest in Largo Physical Vanadium Corp., in which the Company holds a 65.7% majority stake. This facility has a term of six months, bears interest at an annual rate of 15%, and includes a 1% arrangement fee. In January 2026, the facility was extended until February 2027, under the same terms.

In January 2026, the Company executed a term sheet for an additional inventory financing facility for up to $35,000, under which its finished vanadium product inventory may be used as collateral to access funding. The Company commenced utilization of this facility in March 2026 on a transaction-by-transaction basis, pending finalization of the master agreement. Repayments under the facility include a 1% commission, interest at a rate of 11.5%, and other direct costs.

11) Issued capital

a) Authorized

Authorized share capital comprises an unlimited number of common shares without par value. No preferred shares have been issued.

b) Issued

During the six months ended ended June 30, 2026, the Company issued 18,535 shares in an at-the-market equity offering program, at $1.34 per share, for gross proceeds of $24,792.

On October 22, 2025, the Company sold: (i) 14,262 warrants ("October 2025 Warrants") to purchase up to 14,262 common shares, which have an exercise price of $1.22 per share, and became exercisable immediately upon issuance with a term of five years from the date of issuance; and (ii) to Arias Resource Capital Fund III L.P., an affiliate of the Company's largest shareholder, 4,918 common shares and warrants ("Backstop Warrants") to purchase up to 4,918 common shares. The Backstop Warrants have substantially the same terms as the October 2025 Warrants described above, with certain exceptions. See note 12.

12) Equity reserves

During the three and six months ended June 30, 2026, the Company recognized a share-based payment recovery related to the grant, vesting and forfeiture of stock options and RSUs of $113 and $11 (three and six months ended June 30, 2025 - $102 and $212) for stock options and RSUs granted to the Company's directors, officers, employees and consultants. The total share-based payment amount was accounted for as employee benefits in the statement of income (loss).

1. Value is equal to grant date fair value of all outstanding grants.

a) RSUs

RSUs represent a type of share-based compensation under which officers and employees of the Company are entitled to receive shares upon satisfying specified vesting conditions. The Company recognizes compensation expense on a straight-line basis over the vesting period, based on the market value of the shares at the grant date. Upon vesting, the RSUs are settled through the issuance of shares. Forfeitures are recognized as they occur.

During the three and six months ended June 30, 2026, the Company granted 120 RSUs at a market price of C$1.97 (year ended December 31, 2025 - 1,888 RSUs). The fair market value of the RSUs is determined based on the closing market price of the Company's stock price on the date of issue.

b) Stock options

The remaining weighted average contractual life of options outstanding at June 30, 2026 was 2.8 years (December 31, 2025 - 3.2 years).

During the six months ended June 30, 2026, the Company did not grant stock options.

During the year ended December 31, 2025, the Company granted 45,000 stock options with a weighted average exercise price of C$2.46. The options vest over time, with one third of a grant  vesting during each of the three-month periods ending September 30, 2025, 2026 and 2027.

c) Warrants

During the six months ended June 30, 2026,  nil warrants expired unexercised (year ended December 31, 2025 - 328,000).

13) Earnings (loss) per share

The total number of shares issuable from options, warrants and RSUs that are excluded from the computation of diluted earnings (loss) per share because their effect would be anti-dilutive was 21,948 and 21,948 for the three and six months ended June 30, 2026 (three and six months ended June 30, 2025 - 2,041 and 2,041).

14) Taxes

a) Tax (expense) recovery

b) Changes in deferred tax assets and liabilities

The Company's net deferred tax asset of $5,012 held at the beginning of the year decreased by $6,375 as a result of deferred tax expense recognized in profit or loss. At June 30, 2026, the Company had a net deferred tax liability of $1,363.

Income tax expense for the interim period has been determined using management's estimate of the annual effective income tax rate expected for the year ending December 31, 2026, applied to year-to-date earnings before taxes. The estimated annual effective tax rate reflects the expected geographic mix of earnings, available tax attributes and permanent tax differences.

15) Related party transactions

In accordance with IAS 24, key management personnel are those persons who have authority and responsibility for planning, directing and controlling the activities of the Company directly or indirectly, including any directors (executive and non-executive) of the Company.  Their remuneration was as follows:

During the year ended December 31, 2025, the Company completed a private placement which included Arias Resource Capital Fund III L.P. ("ARC Fund III"), an affiliate of the Company's largest shareholder. Alberto Arias, a director of Company's board, is associated with funds managed by Arias Resource Capital. Accordingly, the transaction was considered a related party transaction.

In connection with the offering, ARC Fund III committed to provide total financing of $6,000 (the "ARC Commitment"). A portion of this commitment was advanced through a $5,000 secured convertible bridge loan (the "ARC Bridge Loan"), which reduced the remaining commitment under the ARC Commitment by the same amount. The ARC Bridge Loan was automatically converted upon closing of the offering into units consisting of common shares and warrants on the same terms as those issued to other investors in the offering. As a result of the conversion, no balance remained outstanding at the reporting date.

16) Segmented disclosure

The Company has four operating segments: sales & trading, mine properties, corporate, and inter-segment transactions & other. Corporate includes the corporate team that provides administrative, technical, financial and other support to all the Company's business units, as well as being part of the Company's sales structure.

1. Amounts relating to Largo Physical Vanadium Corp., Largo Clean Energy Corp., Largo Titânio Ltda. and Largo Tech Ltda., which are not part of a separate operating segment.

2. Amounts relating to Largo Physical Vanadium Corp.

3. Amounts relating to Largo Clean Energy Corp.

4. Inter-segment transaction elimination of $40,184 further increased by total assets held by Largo Physical Vanadium Corp. $21,142, Largo Clean Energy Corp. $5,138, Largo Titânio Ltda. and Largo Tech Ltda. total assets of $6,077 and E&E properties total assets of $38.

5. Inter-segment transaction elimination of $46,464 further increased by total liabilities of Largo Physical Vanadium Corp. $872, Largo Clean Energy Corp. $3,487, Largo Titânio Ltda. and Largo Tech Ltda. total liabilities of $52 and E&E properties total liabilities of $nil.

1. Amounts relating to Largo Physical Vanadium Corp., Largo Clean Energy Corp., Largo Titânio Ltda. and Largo Tech Ltda., which are not part of a separate operating segment.

2. Amounts relating to Largo Physical Vanadium Corp.

3. Amounts relating to Largo Clean Energy Corp.

4. Inter-segment transaction elimination of $(12,307) partially offset by total assets held by Largo Physical Vanadium Corp. $18,891, Largo Clean Energy Corp. $5,867, Largo Titânio Ltda. and Largo Tech Ltda. total assets of $5,631 and E&E properties total assets of $12.

5. Inter-segment transaction elimination of $(15,757) partially offset by total liabilities of Largo Physical Vanadium Corp. $872, Largo Clean Energy Corp. $3,851, Largo Titânio Ltda. and Largo Tech Ltda. total liabilities of $76.

1. Amounts relating to Largo Physical Vanadium Corp., Largo Clean Energy Corp., Largo Titânio Ltda. and Largo Tech Ltda., which are not  part of a separate operating segment.Amounts relating to Largo Physical Vanadium Corp.

2. Amounts relating to Largo Physical Vanadium Corp.

3. Amounts relating to Largo Clean Energy Corp.