Lynas Rare Earths Limited

Good day and thank you for standing by. Welcome to the Linus Rare Earths quarterly results briefing conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded I will now like to hand the conference over to Linus.

Please go ahead. Thank you and good morning and welcome to the Linus Reris quarterly briefing for the December 2022 quarter. Today's briefing will be presented by Amanda Lacaze and joining Amanda are Gardem Sturzenegger, Chief Financial Officer, Paul Leroux, Chief Operating Officer, Daniel Havas, VP Strategy and Investor Relations, and Sarah Leonard, General Counsel and Company Secretary. I'll now hand over to Amanda. Please go ahead, Amanda. Good morning, everybody.

I guess I should start with Happy New Year for those who celebrate Lunar or Chinese New Year, Gong Xi Fa Cai. I hope everybody had a really lovely festive season and have come back with enthusiasm and excitement for a great 2023. So I'm pleased to have lodged today's quarterly results. relatively uneventful quarter, which was a delight after some of the challenges of the prior quarter, which of course we talked about in a lot of detail, including the catastrophic failure of water in Malaysia. We did have a few hangover challenges from that at the beginning of the quarter, but We finished the quarter back at Linus Next Rates and look forward to being able to continue. Both of our operational sites performed really well, just as an interesting aside, we had record quarter at Mount World and we are making some very good progress on ensuring that we really are optimising performance right through the value chain from mine to big bags at the end of the land facility. We also made really excellent progress on all of our major projects. Just as a refresher, that includes our big project at Mount Weld where we're expanding throughput by actually four times, which expands our output over time by double. We've got already, Bolters Works contractor has been mobilised We've started the procurement of the long lead time items. That project is prioritised in a way that we're making the investments that are creating bottlenecks for our production today first. So we will release those bottlenecks with our objective being that we will be able to progressively move production up rather than just jumping from today to the 1,000 tonnes a month, which is the target by the end of next year. In addition to that, we are building our stockpile for the Kalgoorlie facility. It will initially be fed with what we're describing as direct shipping oil, which is very high-grade material which we have segregated from the rest of the material, so there's not a constraint from the concentrator on our ability to actually build that inventory to feed the Kalgoorlie plant. Kalgoorlie itself really, our project manager She's telling me on Friday it just is a fabulous time to be on site. I'm looking forward to being there next Monday when we will be, and casually, importantly, signing a cultural agreement with traditional owners associated with our Mountwell facility. But Grant tells me that every day there is something new to look at and it is very exciting indeed to be operating at this time and seeing the huge progress, bearing in mind that it's still less than 12 months from receiving full approvals for that site. And we continue to work on our US processing facility, making good progress on deliverables associated with that project. And then, of course, in Malaysia, we have some significant development occurring to ensure that we can receive the mixed rare earth carbonate. which will arrive from... Sorry, I'm looking at the chat here, which is saying that someone can't get a question in. So I shouldn't look at that, should I? So in Malaysia, we've got a significant project to receive the mixed rare earth carbonate from the Kalgoorlie facility. But as with all of our projects, we will take the opportunity to improve a number of other elements of our processing facility, including in this instance things like soda ash loading and unloading. Because if we're going to be making an investment in a new building, a new capability, then it makes sense for us to use that opportunity to continue to improve efficiencies in our operations. So in terms of the business, The market continues to be very buoyant. Whilst the price was very stable through the quarter, it started to pick up in December and we continue to look into a market with strong demand and really very good pricing prospects for our business. And one of the other things which I think we sometimes sort of underestimate is we're not just an NDPR business. The value which comes from selling our other materials is important within our business. And you can see this when you look at the average price received over the quarter. that while the NDPR price was relatively flat, our average price actually lifted up, and that was a consequence of both the SEG pricing, heavy pricing remains very strong, but also increasing sales of higher value add lanthanum and cerium materials. So a good quarter. We're doing everything we can to make sure that the quarter that we're in is going to be an even better quarter. My colleague Paul has a very popular saying within the business that we are much better than yesterday but much worse than tomorrow and certainly that's our objective is to ensure that we continue to improve But a good quarter, pleased with it, pleased with the settings in the market, pleased with what we've been able to deliver in terms of production and sales, and certainly very pleased with the progress on sort of our really very significant projects. So with those as just sort of general opening comments, I'm very happy to take any questions that people might have.

Thank you. At this time, we will conduct a question and answer session. As a reminder, to ask a question, you will need to press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Paul Young of Goldman Sachs. Please proceed with your question.

Thanks, good morning. Good morning, Amanda and team. Happy New Year as well, and I hope you're all going okay. First question is on the realized pricing. So a good kick up in the realized pricing for the other products, Amanda, as you mentioned. Just on the seg pricing, the heavy pricing and the Lantham cerium, the improvement in product mix and pricing, do you expect that to continue over the next couple of quarters and into the medium term?

I think that we think that the heavy rarest price remains very positive and we would expect that that will continue and we would hope that we will continue to improve the contribution from our lanthanum and cerium materials as we increase the amount of higher value added material that we sell.

Okay all right so we should assume from modelling purposes a bit of a continuation on that dollar per kilo on the other products in that case. Thanks for that. The next question Amanda is on projects and some good progress on the Kalgoorlie cracking and leaching in the quarter. Just observing I guess again the pictures on some of the key items there and and sort of trying to match that with the 1st of July deadline. I'm just wondering if you could just step through internally or when you expect first carbonate production from Kalgoorlie and just talk through maybe the ramp up and just how that sort of matches again with discussions with the Malaysian government. And just on that, if you can just maybe just talk through the new Malaysian government how they've been or how recent discussions, if you had some, have gone with respect to potentially extending the permit on the cracking and leaching uptime or operations, I should say, in Malaysia beyond 1st of July, sort of just to match with that ramp-up requirements from Kalgoorlie?

Yeah, so, Paul, that was a question of very many parts. And it would not surprise you to know that we have a huge amount of effort in the business focused on this transitional period. If we take first the situation in Malaysia, as I think we've indicated previously, it is a matter of public record. It was disclosed by a previous minister that we have appeals to the removal of the four conditions that were applied three years ago to our operating licence. Our position is very strongly that we run a low-risk operation. We are a lawful company which is compliant with all regulations and we have never been involved in any sort of health or environmental incident. The most compelling data that we have is now our 10 years of safe operation in Malaysia. So, of course, governments change. Our advocacy has always been that decisions should be made to ensure that we are treated fairly and equitably. and that our performance is recognised. So when the AELB does their audit of our operations in Malaysia, we have consistently been rated as very satisfactory, which is the highest. level which is available. And all that we seek from government is the decisions are fact-based, not actually made on the basis of some of the alarmist statements from some activist groups, which even the IAEA has said have no basis in scientific facts. So we continue to engage with both the regulators and also with the government. As recently as last month, we had a delegation from Malaysia come to visit our site in Kalgoorlie. So we have never pretended that we can forecast timelines that governments may choose, but we are actively engaged with, as I said, both the government and the regulators. In terms of feed on and ramp up in Kalgoorlie, we have our own targets, which of course are all about ensuring that we will be able to bring that facility online but we are also looking to opportunities where we can ensure that we have you know sort of safety stock as as required as we manage potentially a transition period okay thanks Amanda can I just clarify one thing is is one of the options or that you're planning for a

transition period it sounds like it is as far as you know having to run LAMP below capacity you know as as Kalgoorlie ramps up.

Look we've got a number of scenarios and we're preparing ourselves for all of them right the best possible scenario is one where we're running two facilities which gives us a straight up uplift in the ability you know in throughput right through to one where we are required to close down one facility and operate the other. So we're managing a number of different scenarios and it will be clear long before the 1st of July which of those we will be required to execute.

Okay, all right. Okay, thank you Amanda.

Thanks. One moment for our next question. Our next question comes from the line of Daniel Morgan of Barenjoy. Please proceed with your question.

Hi, Amanda and Tim. The plant clearly exited December at a very strong run rate, and I think you said earlier that you're looking for Linus' next rate to be achieved, which is about 1,800 tonnes a quarter of NDPR. Is that what you anticipate for the next few months or next couple of quarters? for your throughput or is there any major maintenance or anything else that might impact being able to run at that rate?

Not every month will be the same because of course some months have 31 days and some months have 28 days. But running at around about 7,000 tonnes a year is always our objective. And we're just pleased that we're at that sort of run rate at present, but we are always sort of cautious about making strong predictions on this, given some of the impacts that external factors can have on the business.

Thank you. And just on Kalgoorlie, The plant, which obviously I can see progress there. Just wondering your expectations. Once everything is in place and the plant is complete, how long do you think it takes to ramp up and commission the plant to full capacity?

I think that that will not be absolutely clear until we commence operations in that plant. Suffice to say that we have a really strong commissioning team. We have our operational team all in place already in Kalgoorlie, it's a residential team. Writing processes, we will have all of the equipment properly tested before we commence and we have our significant sort of experience of operating a plant of this type in Malaysia. So we expect the ramp-up time will be assisted by that level of experience that we have. But at this stage, we won't be disclosing any specific timeline on that.

Okay. Thank you very much, Amanda.

Thanks, Daniel. One moment for our next question. Our next question comes from the line of Al Harvey of JP Morgan. Please proceed with your question.

Good morning, Amanda and team. Just following up on the licensing in Malaysia, I just want to confirm which works are actually underway. My understanding is there's a renewal for the entire facility due sometime around March 2023, and then the negotiations or your appeal on the restrictions put on cracking and leaching for July is occurring in parallel. Just kind of trying to get a sense of whether or not you think that those two could come concurrently, and we're still expecting that before March this year.

Al, I've learnt not to predict how either regulators or governments may choose to proceed, but you are right. We operate under an operating licence in Malaysia. The AELB, we've had five of those issued over the period of time that we've been operating in Malaysia. And the AELB issues those licenses with, well, we had a single set of conditions for the first sort of seven, eight years of operation. And then we had sort of these additional conditions placed upon the operating license in March 2020. So our objective and our appeal is to have those conditions removed. However, those conditions are not effective until the beginning of July. So one scenario may see us with our operating licence renewed with the conditions in place. Another one may see us with the operating licence renewed with the conditions removed. As I said, we continue to engage both with the regulators and government and to prosecute our case very strongly for the fact that we have operated safely for 10 years under a set of operating conditions and there's no scientific basis for making a change to those.

Great. Thanks, Amanda. Secondly, just a bit more detail on the water reliability issues. Just wondering if the improvement is a reflection of a better performance of the pipeline. Is it seasonality or is it some of the backup measures you put in place over the last couple of months or a combination? I just want to try and get a sense of if and when we might see a return of water issues down the track

Well, the issue that we had in September was a catastrophic equipment failure. And so we haven't had sort of an equipment, we haven't experienced an equipment failure of that magnitude in the time that we have been in Malaysia. It was a big pipeline that burst and it was 10, I think it was 10 metres underground and it affected everybody, residential, industrial, everyone. So it would be our hope, and I am sitting at a wooden table so I'm touching wood, that this will not occur again. In terms of some of the other issues associated with our supplier pipe, there have been a variety of different issues over time which we have generally been able to mitigate. which may be associated with the pumping station or another time we had an issue with the bund wall which failed, but generally we have been able to mitigate those issues. But we continue to work on projects which will see us not have to use as much water. I mean, this is consistent with best practice sustainability practices, so we certainly want to be doing that. And so that includes opportunities to recycle water and some rather exciting sort of further developments on that. But they are not short-term fixes, so we do continue to have our pipeline to the local you know sort of pit which fills up with water when it rains and it's rained a lot in the last three months but pipe water supply has been consistent now across the quarter and and we really haven't had to rely on some of those other initiatives right maybe just the final one before i pass on

Just want to understand if there's any potential for you guys to provide a reserve update sometime this year on Mount Weld. Just really pretty keen on getting the split of contained rare earths and that deposit and how that changes with depth. I guess we haven't seen a split out in a reserve or resource statement for a little while, so any update there?

Yes, well we will do at a minimum, we'll do a reserve update as part of our annual report because of course we're required to do that. We have a whole team working on defining the carbonitite reserve or resource in the first instance. So that work continues. I don't expect that we will be finalising that within the next six months. But in addition to that, we are doing a lot more drilling as part of preparation for our next mining cutback. and to more accurately define the reserve. So when Linus just started a decade ago, more than that, so 14 years ago in Mount Wells, we had really good drilling in quite a small area of the ore body in what we call in the central lanthanide deposit, and we had a lot of other drill areas where it was relatively sparsely drilled. Now we are progressively drilling through different areas to properly flesh out our understanding of the ore body. The other thing which we are working on is we have a 4% cut-off grade, which of course is pretty amazing compared to some of the other deposits which are being developed. And so we are doing some further work to really understand whether that, which was set, once again, very early on in the process of development of the Mount Weld ore body, whether it remains economically optimised to have a cut-off grade at that number, or whether we should be looking at a different cut-off grade. So we do have a lot of work going on in terms of both geology and mining and yes we will be providing both resource and reserve updates but we don't expect that we will have completed the Kibana type work by the time we do the next substantive update but we believe that we will have substantive information related to the reserve as it is currently conceived. Does that make sense?

Yep. I might come back with a follow-up, but I'll pass it on for now.

Well, I'd be happy, Al, to facilitate a discussion with our Mountwell team to provide some more detail. I guess, suffice to say, that as a business we seek to always have a long life reserve and so the work that we are doing drilling both within the current deposit and also at depth is all part of ensuring that we maintain that long life.

Great, yeah, definitely love to be able to pick the brain of the team. Just while I've got you, I might just throw in one last question. Just thinking about markets and Chinese production quotas, I assume we're probably going to get another six-monthly update pretty soon. Have you or the team got any views on whether they'll likely increase those I might actually pass that over and let Paul answer that.

He's much closer to that than I am.

Good morning. First, in the production quotas, you remember that last year, combining first and second half, the production quotas led to around 20%, a bit more than 20% increase. And that was balanced with the demand increase. So that reflects in a fairly stable price. Next, production quotas are expected to be released after the lunar year. But it's a bit like with any regulators. There is no one knows what will be. I believe it will still be in line with the variation of demand, but that's all I can say on this.

All right. Thanks very much, Tim.

One moment for our next question. Our next question comes from the line of Austin of Macquarie. Please proceed with your question.

Hi, Moni, Amanda, and the team. Congratulations on the strong cultural result. Two questions from me, please. The first one is on the price realization. Just wondering if you could provide a bit more color on that new lanthanum and serum specialty product you developed. How much of the price premium can you get for this product? I'll come back with the second one. Thank you.

Okay, thank you. Once again, I'd like to pass over to Paul for that because this is an area of passion for Paul.

Yes. It's a very complex question to answer. I would say that we focus on adding value to basically cerium product mostly and lanthanum as well, but cerium number one. And so you can check when you run the numbers, you can analyze the premium. It's already substantive. We have a lot of work and a plan of development for a lot more added value. But as usual, the more complex targets you target, the more time it takes. So this will continue over the next, I would say, years. But definitely, it's a very important KPI for us, and that's why we reinforce our R&D pool to develop a new product and application in the basically area, which will continue to be in oversupply for quite a while. But for numbers, sorry, I can't really give you numbers precisely. It's substantial.

All right. Thank you. The second one is on the cost inflation. Just wondering, Amanda, how are you managing the cost inflation pressures at Mount Weld and the Karkuli project? I mean, in this reporting season, we see many companies reporting higher costs. So it seems like this inflation pressure is kind of staying with us.

Yeah, so we did provide an update last time on the fact that a combination of growth in scope and also cost escalations at Kalgoorlie saw an update from 500 to, I think it was 575 mil, but basically at 15%. I've left bearing in mind that that was a combination of both costs and scope changes in the facility. We see pressures across all of the business, but we're paid to manage those, so we focus on ensuring that we continue to deliver efficiencies So if unit costs go up and they're unavoidable, well, our task is to implement projects which will see us improve the efficiency of operations. Whenever we think about costs, we think about how do we do things better? Because if we do things better and we reduce waste, then costs will increase. inevitably come down as a result. So we do have escalation of costs but we also have improvements in efficiency and we've not had to take any sort of significant actions to drive costs out of the business, in fact quite the opposite We continue to grow our investment in the business because we're facing such a strong growth market. So when we look at our costs, we certainly see two or three big contributors to cost escalation. And at Mount Wells, of course, a huge one of those is energy and an increase in diesel costs. We are working on alternate energy solutions for our Mountwell facility, which over time will drive costs out of the business, we believe. And in Malaysia, for example, we've seen really significant increase in sulfuric acid prices, which had been stable for a very long period of time. Once again, it's not something which is avoidable in the short term, but continuing to enhance efficiency, continuing to improve recoveries will mitigate to some extent the effect of those price increases on the business performance.

Thank you, Amanda. I'll pass it on.

One moment for our next question. Our next question comes from the line of Reg Spencer of Canaccord. Please proceed with your question.

Thank you. Good morning, Amanda and Cole and Matthew. I'll start with Malaysia, if I can. I presume you guys will have seen that the press last week relating to a decision on the extension of the licence conditions in Malaysia. That press referred to a potential decision by the government early next month I'm not sure whether or not you'd be willing to comment on that, but can I have a quick reply that would ask you to comment on that?

Oh, look, you know, don't believe everything you read in the press, but in this instance, as we've disclosed previously, our operating licence is due for renewal on 2 March, so we do expect that we will have some indications from the regulator with respect to that operating licence renewal, certainly no later than the 2nd of March. Okay, thanks.

Speaking with Malaysia again, it concerns something for me then. So your annual concentrated import limit gets reset. Is that reset at the start of the year, such that regardless of the... Sorry, such that regardless of the... Sorry, Rach, regardless of what? The outcome of the operating licence conditions would provide you with enough concentrate to get you through the ramp up at Kalgoorlie. So you're working now to build up that concentrate for the next six months or whatever that term might happen to be?

Look, we have a series of conditions associated, standard conditions associated with the licence, which includes the amount that we can import, the quantity which can be stored on site at any given time. At various times, we've been able to get variations to that, particularly through the pandemic where we had variability in the amount which was delivered and when it was delivered. We also have conditions associated with the amount that can be processed. We manage within all of those conditions and so without trying to make it too complex, as I said, there's a series of conditions. We manage to those conditions. Yes, one of them is associated with the amount that we can import. And yes, it does reset on the 1st of January each year.

That's beautiful. Thanks, Amanda. I'll pass it on. Thanks, Grace.

Thanks, Grace. One moment for our next question. Our next question comes from the line of Jim Ariasin of UBS. Please proceed with your questions.

Cool. Thank you. Thanks, Amanda and team. Look, just a quick one for me. I was just hoping you can reconcile, help me reconcile some of the numbers. So CapEx for this year, you've guided previously towards 600 mil, and then there was a CapEx creep for Cal, as you reported on last quarter. So that takes it to 675. I'm just trying to reconcile that with the cash spend of 240 for the hire. Do you expect the second half of the... or you could just walk me through that, thanks.

Yeah, sure. And I'm happy to let Gareth add a bit more onto this as well. But yes, this is cash. We're now committed almost fully in terms of purchase orders associated with the Cargillie project. And so this is just a timing issue as to when it actually goes out. notwithstanding guidance, if we don't have to pay something, we don't pay it just to stick with the timeline. But Gaudens, maybe you'd like to say something more to the capital profile.

Yeah, good morning, everybody. I think on the CapEx, what you can really see is, particularly on the cash side, an increase in spend levels. which obviously follows the commitment which out in the market. I think the last quarter was above 140 million and the quarter before 100 million. So you see a clear trend and I'm very sure we see the trend to continue. So particularly the next two quarters will be uh quite high uh in uh specifically in regard to the uh kuguli project which logically makes uh make sense on demand mountwell expansion program they will see a ramp up as well but on a much lower lower level at this point in time right okay cool thanks and just um what yeah when can we expect to get up to cal and

do more than a drive-by, is that in the works?

Frankly, we have a huge number of contractors on site. We wouldn't even take you onto the site right now because just managing the traffic with the contractors on site is a challenge in and of itself. Yeah, I can't answer that, but I'll have Daniel come back to you with some estimates on timing. But it certainly won't be whilst we've got hundreds of people actually building stuff. So it's going to be some months before we would be able to have visitors on site.

Oh, that's good. Okay, cool. Thanks, guys.

One moment for our next question. Our next question comes from the line of Paul Young of Gorman Sachs. Please proceed with your question.

Thanks. Hi, Amanda. A few follow-ups from me. Just on your ex-Malaysian and actually downstream strategy, just wondering if you could expand on the comments on the US refinery. I know you said that you make good progress on deliverables. Just wondering what that is. Has construction actually started? Have you selected the site? Just after a bit more information on the US refinery progress. Thanks.

Yeah, we've identified a site. It's on the Gulf Coast. We're working with various levels of government on finalising that position. We think that it's a very good site for the plant because it's within an already industrialised area, has good services, has access to very good and skilled labour. With respect to engineering, detailed engineering and design, that's been completed but now we're working with the outsourced engineering team and we think we've had some fairly challenging inflation of costs in Australia, while in the US it's been at Australian levels plus some. So we have populated more of the team with both internal and external resources. It's that stage where there's nothing much exciting to see but all of the heavy lifting in terms of sort of planning and design, development, all of those sorts of things, that's where we are right now. So not very exciting for everybody outside, but quite exciting for the project team.

Yeah, okay, understood. Thanks, Amanda. And just your comments around engagement or incoming inquiries from OEMs. and non-China magnet facilities for offtake. That's really interesting. And I guess the question I have is around, of the 12,000 tonnes of NDPR you want to produce, how much actually is not contracted? So I guess outside the Chinese and Japanese contracts.

Okay, so I'll just hand over the poll to answer that question.

Well, I can make a very simple answer. Since our production capacity currently is 600 tons a month, we don't contract over our capacity. So the day we are at 1,200, that would be 600 tons a month additional to contract. Because people won't sign a contract and promise that you will send their produce. They want to see evidence. Sometimes the MOU is a company saying they will produce rays sometime in the future, but it won't go to a contract level. So the answer is very simple. And we just have a queue of OEMs and lots of discussion on going with them for securing the supply of rays. In addition to that, anyone who has a project for magnet making outside China today comes to Linus. So that's why, because we are the only one supplying NDPR at Sankt Shana. And so all in all, we are not short of demand. I would have to say that we should supply, but that's my problem as well.

Yeah, thanks Paul. The short answer is we don't sell anything in the spot market.

Yeah, I understand that. Yeah, it's just from a volume perspective on a percentage terms. versus the line of 2025, the upsized plan. But what Paul just said is very helpful. Last question I have, Amanda, is just on, I mean, this industry, everything is developing so quickly. Every quarter, from a downstream perspective, the magnet industry is changing very quickly and will change very quickly over the next couple of years from a perspective of government funding, but also involvement by OEMs. You see what MP Materials has done, but also new entrants across the value chain. Are you interested in, Is one of your things you're looking at potentially getting funding from OEMs or even actually getting involved in magnet making?

At this stage we don't have a gap in funding so we're not specifically looking for additional funding sources. In terms of do we extend into further downstream activities, We have a continuing watching brief on that and have done quite a lot of work really on what are the opportunities, what might they look like, how could they be executed. Right now, and the last time we did sort of a full review on this, we can get bigger bang for our buck for our shareholders. by increasing output than we can by diverting attention into some of the downstream activities. One of the hallmarks of our success is that we focus on doing things, completing them, and then moving to the next one. So right now we have a very, very full agenda with the Mount Weld expansion with Kalgoorlie, with the further development of the Malaysian facility and with the US. But yes, we have work ongoing with respect to downstream development, which we will brief at an appropriate time.

Okay. Thanks, Amanda. Very interesting. I'll leave it there.

Thanks. One moment for our next question. Our next question comes from the line of Al Harvey of JP Morgan. Please proceed with your question.

Thanks for the follow-up. Maybe following up with Paul, just you mentioned Chinese quotas could come in line with demand growth. Just wanted to get a sense of where you guys are seeing your forecast for demand growth in 2023 and then and maybe out on a five-year view if you've had any substantial changes since you've laughed, mentioned those things.

Okay, so short-term growth 2023 for us, we are more than fully booked with our existing contract. And The growth, especially in electric cars, continues to be very strong, with a slightly improved situation on the semiconductors supply, which has been cutting a bit of the growth last year. On the long run, definitely this will continue, so we're talking about double-digit growth for the next five years at least. unless there is something like a global financial crisis that we experienced a few years back. The question being where will this demand come from? Is it from China or is it from outside China? And that's the game that is being played at the moment. Who will be the leading country for electric cars? And there is a lot to do in the West to uh to not to not lose um this fight against china or yeah and that that is that is yet to be seen we don't see uh we see a lot of announcement of magnet new magnet projects uh so far outside china i've seen only one new factory in vietnam from schnitzel but that's That's an existing magnet maker. And that's a very excellent customer of Linus. But that's the only one who did actually increase production outside China so far. So we'll see.

All right. Thanks, Paul. Thanks, Tim.

As a reminder, to ask a question, you will need to press style 11 on your telephone. One moment, please.

Okay, it sounds to me like we might have had all of the questions. So we're about five minutes from the end. So if anybody else has a question, now's a good time. Otherwise, I would once again thank you all for your interest and look forward to seeing you in person as we move through the year.

This concludes today's conference call. Thank you for participating. You may now disconnect.