29Metals Limited

Thank you for standing by and welcome to the 29 Metals March Quarter Investor Conference call. All participants are in a listen-only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. I would now like to hand the conference over to Mr. Mike Slavesky, Head of Investor Relations. Please go ahead.

Thank you, Melanie. Good morning, everybody. Ladies and gentlemen, welcome to 29 Metals March quarter, first quarter conference call. This call is being recorded and will be available afterwards either via the 29 Metals website or via the open briefing website. Joining me today is 29 Metals Managing Director and CEO, Peter Albert. He'll commence the discussion before passing to Cliff Tuck, our Chief Sustainability Officer. We'll talk to sustainability and ESG activities and achievements. Cliff will pass to Ed Cooney, Chief Operating Officer, who will lead you through our operating performance. Ed will also cover up on exploration at this time because our Group Manager Geology, Mark Van Heerden, is actually doing some pretty exciting work for us at Red Hill in Chile, which we'll perhaps talk to next quarter. Ed will pass to CFO Peter Herbert to lead you through the financial outcomes, then back to Peter for Q&A. So I'd now like to Pass over to Peter. Thank you, Peter.

Yeah, thanks, Mike, and thanks for the introduction. Welcome, everybody, and thank you for joining us this morning. Mike's already done the introduction, so I don't need to do that again. We'll go straight to the overview of the quarterly results, and then, as Mike said, I'll hand over to Cliff, Ed, and Peter for a bit more color in each of their specific areas. And as Mike said, Mark Van Heerden, not with us today. He's down in Chile with the teams down there. doing some exploration field work at Red Hill. First of all, of course, safety and health. The safety performance has been held mostly steady during the quarter, although we did have one lost time injury at Golden Grove. There has been a lot reported and in the press in recent months in respect of harassment at mining sites. A workplace health survey we conducted late last year at our sites indicated no major concerns. However, we have to assume that the risks are prevalent in these fly-in, fly-out environments. Our leadership team has taken an active role in communicating the nonacceptance of any form of harassment or bias. An inclusivity and diversity working group has been established across the business, which has already identified a number of initiatives which are being followed through to enhance the workplace environment. This is a significant area of focus for us to ensure Our culture supports an inclusive and diverse environment, initiatives widely supported by our leadership teams across the group. COVID, of course, has been a significant business matter for us during the past quarter. The opening up of borders has seen significant COVID impact at both operations, whilst more so at Golden Grove in the west. The difference in the regulatory environment between states and the definition and treatment of close contacts, has resulted in multiple events where contractors and employees have either been isolated or unable to turn up to work. Monitoring reports from other operations, it would seem that to date, 29 metal sites have fared better than most. And whilst we expect an improvement in rates of COVID-related absenteeism going forward, nobody can be quite sure that the impact has yet peaked. Last Thursday, we released our 2021 and our first annual report, and included within the annual report, but also available as a separate document on our website, is our first sustainability report. During the quarter, we also appointed Cliff Tuck as our Chief Governance and Legal Officer, adding sustainability and ESG to his other responsibilities as Company Secretary and General Counsel. We're also in the process of recruiting a group manager sustainability. Cliff will provide a short overview of the ESG work and our sustainability and ESG report in a moment. With the backdrop of COVID impacts on our workforce, multiple weather-related interruptions at both sites, and we've had quite extensive lightning at both sites in this last season, and supply factors exacerbated by the extreme weather events in eastern Australia, I can only say that whilst production has not been at the levels we had planned, I am nonetheless pleased with what we have achieved. Zinc production was always weighted to the second half of the year, so zinc at 12,200 tons produced was strong. Copper at 9,300 tons is below what we had planned, primarily due to lack of labor and slower access to high-grade mine areas and therefore treatment of lower-grade material. It is, however, worth noting that on nearly all metrics for the quarter, performance was significantly better than for the same quarter last year. Subject to COVID impact stabilizing and reducing during the current quarter, we anticipate that our full year production will remain within our previously provided guidance range, although probably more likely to be in the lower half. There is a change to guidance in respect of capital development, but that increase is offset by a corresponding reduction in mining costs. And there is also an increase in zinc TCs as a consequence of the extremely strong zinc prices being currently received. All commodity prices have been strong in the quarter, resulting in a very strong revenue of 232 million Aussie dollars, almost double the same period last year. As advised previously, we no longer provide guidance for copper equivalent production, but we do report actual copper equivalent production on a quarterly basis. And for the March quarter, our copper equivalent production was 15,800 tons down on the December quarter, which of course, as we, I'm sure everybody's aware, was an outstanding quarter, but significantly up on the same quarter in 2021. Despite industry-wide cost and inflationary pressures, our costs have been well managed across the business, although the unit costs are higher due to lower copper production than planned. Access to labor and labor costs are a significant issue for the industry, with almost historical low unemployment rates prevailing across the country. 29 Metals is focused on ensuring our remuneration, attraction, and retention strategies are market competitive. There were a number of important operational and de-risking milestones in the March quarter, including completion of what is known as the Hox Link at Golden Grove, enabling a one-way traffic system, improving truck movements and ventilation, extension of fresh air raises to the new mining front at Xantho Extended, significant advancement of the Pace Fill Plant at Golden Grove, completion of surface water infrastructure projects at Capricorn Copper, completion of raised boring the return air rise at Capricorn Copper, completion of the lift at the Capricorn Copper tailings facility, and completion of the transition of the Capricorn Copper process plant maintenance and paste plant operations to 29 metals management. We also issued the 2021 mineral resource and reserve statement, which produced 100% uplift in the estimated resource tons and a significantly greater uplift in metal content for Cervantes. and a continuation of project activities for the potential development of Cervantes and Gossard Valley with decisions anticipated in the third quarter this year. Our organic growth program has suffered a little this quarter due to COVID impacts, and in some cases, redeployment of labor to production activities. Nonetheless, we've continued extension and exploration activities with an excess of 11,000 meters of drilling at Cervantes, Condoville, Xantho, Amity, Scuttles GG4, ESS, Mammoth North, Mammoth G-Lens, and Esperanza Deeps. We're also most of the way through our first Red Hill exploration field campaign due to finish in mid-May, with some encouraging samples collected. Assay results, as well as the high-resolution magnetic survey, are due to be received and analysed in the second and third quarters of this year. Peter Herbert will talk to financial outcomes, but in brief, a very pleasing outcome for the quarter, given the challenges experienced by the whole industry, supported, of course, by strong commodity prices. I'll now hand over to Cliff Tuck to give us a bit more color and insight to our sustainability and ESG report and some of our plans for this year. Then Cliff will hand over to Ed, and Ed on to Peter Herbert for the commercial and financial results. So thank you. Over to you, Cliff.