Lithium Argentina (NYSE: LAR) buys back $200 million of notes and swings to a profit

What happened

Lithium Argentina AG (NYSE: LAR) repurchased $200 million of its convertible notes due in January 2027 for approximately $198 million in cash. The money came mostly from a new convertible debenture. The buyback swaps one convertible for another. It does not pay debt down from operating cash.

The company reported the repurchase on Nov. 10 with third-quarter results. It took place after the quarter ended. The debenture was sold to GFL International Co., Limited, a subsidiary of Ganfeng Lithium Co. Ltd. Its proceeds could be used only to buy, refinance or repay the 2021 equity-settleable convertible notes. The company used them, together with cash on hand, for the repurchase.

Key numbers

Metric	Latest	Change	Source
Convertible notes due January 2027 repurchased	$200 million		SEC 6-K, MD&A (Exhibit 99.2)
Cash paid for the repurchase	approximately $198 million		SEC 6-K, MD&A (Exhibit 99.2)
Q3 sales, Minera Exar (100% basis)	$184.4 million	from $58.48 million, +215%	SEC 6-K, financial statements (Exhibit 99.1)
Q3 net income (loss)	$12.97 million	from -$64.47 million	SEC 6-K, financial statements (Exhibit 99.1)
Q3 share of income (loss) of Cauchari-Olaroz	$16.75 million	from -$52.50 million	SEC 6-K, financial statements (Exhibit 99.1)
Cash and equivalents at Sept. 30, 2026 (Dec. 31, 2025: $61.13 million)	$312.33 million		SEC 6-K, financial statements (Exhibit 99.1)

Read more: Lithium Argentina AG (LAR) company research

Where the profit comes from

Lithium Argentina swung to net income of $12.97 million in the third quarter from a net loss of $64.47 million a year earlier. Most of the swing comes from its stake in the Cauchari-Olaroz mine. Its share was income of $16.75 million against a loss of $52.50 million.

The $184.4 million revenue figure in the quarterly report matches the sales line in the Minera Exar financials, shown on a 100% basis. Those sales rose 215% from $58.48 million a year earlier. The filing credits stronger realized lithium prices and higher sales volumes. The average realized lithium carbonate price was approximately $17,580 per tonne.

Lithium Argentina owns 44.8% of Minera Exar and uses the equity method, so its own income statement carries only its share. Two other items affect the comparison. A $7.26 million gain on financial instruments measured at fair value helped this year's quarter. The first nine months of 2025 included a $9.3 million loss on the JEMSE receivable, and the filing shows none in the same period of 2026.

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What the buyback changes

OptimistFi's calculation shows the repurchase retired the notes about $2 million, or about 1%, below par. That is a small gain next to what the funding does to the balance sheet.

The new debenture is also convertible. For twelve months from issuance, its conversion price falls if Lithium Argentina issues shares or convertible securities below that price in a private financing. So the number of shares deliverable on conversion is not fixed. The company carries the debenture as a $177.73 million current liability, alongside $250.58 million for the 2021 notes.

Cash and cash equivalents were $312.33 million on Sept. 30, up from $61.13 million at the end of 2025. That balance included the restricted debenture proceeds. Operations did not fund the deal. Net cash used in operating activities was $22.63 million for the nine months, against $27.76 million a year earlier.

Cash coming back from the mine

The clearest sign of self-funding is repayment on loans Lithium Argentina made to Exar Capital, which passes the money on to Minera Exar. Exar Capital repaid $58.58 million of loans and interest in the nine months, including $45.64 million in the third quarter. That compares with $3.92 million in the first nine months of 2025.

The loans stood at $295.99 million on Sept. 30. They bear interest of 8.25% to 8.95% and mature from 2029 to 2035. Management says recovery depends on the future cash flows and performance of Cauchari-Olaroz.

The company also closed its PPG joint venture with Ganfeng on Oct. 12. It keeps 33% and Ganfeng holds 67%. The Pastos Grandes and Sal de la Puna assets put into it were carried at $532.05 million as held for sale on Sept. 30.

Why it matters

OptimistFi has argued that the stock works only if the Argentine assets become self-funding before cash burn and commodity-cycle pressure force dilution or impairments. The quarter supports the first half, since the mine's income share and loan repayments are flowing. But another convertible with a conversion price adjustment paid for the buyback. The dilution risk has been refinanced, not removed.

The mine itself carries debt. Minera Exar's third-party debt was $357.57 million on Sept. 30, up from $292.69 million at the end of 2025. About $112.50 million of borrowings secured by Argentine sovereign and corporate bonds mature within twelve months. Lithium Argentina has guaranteed $49 million and $42 million of two Ganfeng-backed loans. The filing says no amount has been recognized for either guarantee.

What's next

The second $50 million tranche of Minera Exar's bank loan matures on Dec. 1, 2026. The first tranche was extended on Oct. 21 to Oct. 18, 2027. The filing says the loan will roll over automatically for the rest of an agreed three-year term once the standby letter of credit is extended. Minera Exar's unsecured bonds fall due in two $25 million tranches on May 11 and Nov. 11, 2027.

Lithium Argentina's report for the quarter ending Dec. 31, 2026 is the next test. Continued Exar Capital repayments and a positive share of mine income after the PPG closing would back the self-funding case. A slide in either would put the new convertible's dilution terms back in focus.

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