UAMY

UNITED STATES ANTIMONY CORP - 10-Q Summary (Q1 2026)

Business Context and Reporting Period

This filing covers the quarterly period ended March 31, 2026. United States Antimony Corporation (USAC) operates two primary segments: Antimony (mining and processing in Montana and Mexico) and Zeolite (mining and processing in Idaho). The company is vertically integrated, producing antimony oxide, metal ingots, trisulfide, and precious metals (gold/silver), alongside industrial zeolite. USAC is a non-accelerated filer and a smaller reporting company.

Key Financial Metrics

Material Changes vs. Prior Period

• Revenue Decline: Total revenue decreased 3% year-over-year. Antimony revenue fell 6% due to lower sales volume (23% decrease in pounds sold), partially offset by a 22% increase in average sales price. Zeolite revenue dropped 7% due to lower volume and price.
• Profitability Reversal: The company swung from a net income of $0.55 million in Q1 2025 to a net loss of $11.29 million in Q1 2026. This was driven by a $4.06 million unrealized loss on equity securities (Larvotto Resources) and a significant increase in operating expenses.
• Expense Surge: Total operating expenses rose to $8.63 million from $2.01 million. This includes a massive increase in share-based compensation ($4.83 million vs. $0.25 million) and salaries/benefits ($5.88 million vs. $1.00 million).
• Inventory Buildup: Inventories increased by $9.5 million to $22.0 million, primarily due to a strategic buildup of antimony inventory, which consumed significant operating cash.
• Capital Expenditures: Investing cash outflows surged to $12.6 million, driven by the $4.8 million acquisition of a flotation mill in Radersburg, MT, and $4.6 million in construction for the Thompson Falls smelter expansion.

Guidance, Outlook, and Material Events

• Government Grant: In March 2026, USAC was awarded a $27.0 million grant from the U.S. Department of War under the Defense Production Act. As of March 31, $12.8 million was recognized as a receivable for completed milestones, with the remainder contingent on future milestones.
• Strategic Investments: The company entered a joint venture (49% interest) with Americas Gold and Silver to build a hydrometallurgical facility. It also acquired mining claims in Alaska and Ontario, Canada, and a flotation facility in Montana to enhance vertical integration.
• Equity Investment Volatility: The company holds a significant investment in Larvotto Resources Limited. The $4.06 million unrealized loss in Q1 2026 reflects market price fluctuations and currency exchange impacts.
• Liquidity: Despite the cash burn, the company maintains $3.2 million in cash and $20.5 million in held-to-maturity debt securities. Management believes current resources are sufficient for the next 12 months.
• Management Change: Subsequent to the period end (May 4, 2026), the CFO took a leave of absence, and Shawn Winkler was appointed Interim CFO.
• Controls: Management concluded that disclosure controls and procedures were not effective due to material weaknesses related to the small size of the accounting staff, though remediation efforts are underway.

Investor Verification Checklist

• Grant Milestones: Verify the specific milestones required to unlock the remaining $14.2 million of the Department of War grant and the timeline for achievement.
• Inventory Valuation: Assess the risk of further inventory write-downs given the $9.5 million buildup and the $161k write-down already recorded in Q1.
• Equity Investment: Monitor the fair value of the Larvotto Resources investment, as volatility here directly impacts net income.
• Share-Based Compensation: Review the sustainability of the $4.8 million quarterly share-based compensation expense and its impact on future dilution.
• Internal Controls: Monitor progress on remediation of material weaknesses in disclosure controls and financial reporting.