Lynas Rare Earths Limited

Today, and thank you for standing by, welcome to Linus quarterly results investor briefing. At this time, all participants are in the listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you need to press star 11 on your telephone. You'll then hear a message advising your hand is raised. Briefly advise that today's conference is being recorded. I would now like to hand the call over to Linus Randolph.

Good morning and welcome to the Linus Rare Earth Investor Briefing for the June 2025 quarter. Today's briefing will be presented by Amanda LaCasse, CEO and Managing Director. And joining Amanda today is Gaden Sertzenegger, Chief Financial Officer, Sarah Leonard, General Counsel and Company Secretary, Daniel Havas, VP Strategy and Investor Relations, and Chris Jenny, VP Sales and Market Development. I'll now hand over to Amanda to commence the briefing.

Good morning, everybody. I'm told that we've already got lots of people in the queue for questions, so I will keep my opening remarks relatively short because I did get some feedback from somebody that, you know, they felt that we never had quite enough time to cover all the questions. Having said that, having thought a bit about some of the questions you might ask, For those of you who are aficionados of Insiders on Sunday mornings on the ABC, you might find that, you know, I have borrowed on some of the language that the politicians often use there, which is, oh, well, I would not be using Insiders on Sunday morning to announce new policy. But we'll see as we go in terms of the questions. We are very pleased to deliver this report for the final quarter of FY25 because it does mark the delivery of a number of, as we call them, firsts, but certainly we've had a significant development and investment program over the last five years And so as we look at our business, we expect really every month to be a record month and every month to be better than the one before. So Paul's famous quote, better than yesterday and much worse than tomorrow. And we continue to be very focused on how we deliver growth in what is an excellent market in which to be participating and which we expect will continue to be a significant growth market. Of course, the first and most important, we exceeded 2,000 tonnes of production for the first time in this quarter, and as I said, you know, my conversation with our production team is that the expectation is that each month will be a record month, although I qualify that again with the fact that we're not just going to produce for the sake of producing, but we did increase the run rate progressively as the month went on. I would like to particularly sort of reflect on the excellent performance at Mount Weld in terms of current production, production over FY25, built sufficient inventory that we were able to have a shot in this month, which de-risks the transition from the old plant to the new plant. I think as our general manager there said, the old plant can now be retired, I forget the word he used, but basically with a claim. It has certainly, for really a very small facility, served us very well over the past decade. Certainly very big news for the quarter was the first production of dysprosium oxide and terbium oxide at our new production line in Malaysia. They both came out in May and June respectively, marking the first commercial production of separated heavy rare earth polymers and the first commercial production outside China in many, many years. At Mount Weld, as we finish the Mount Weld expansion project, and as noted in the report, you know, all of the major construction is now complete with non-process, some non-process construction ongoing. The project has been an excellent project for us and it is certainly... to date, working as designed, which is, of course, the most important thing, but also on time and on budget. The installation of the first wind turbine at Mount Weld and the completion of the solar farm are important markers as we transition from diesel-based power generation to largely renewable energy sources at Mount Weld. consistent with our position in the market as a sustainable producer of rare earths. And then in Malaysia, we have two important steps, which is a signing of an MOU with the Kelantan Menteri Bazaar Inc. for the development of upstream rare earth deposits in Malaysia. and the signing of an MOU with JS Link from Korea for the development of downstream assets in the form of a new magnet manufacturing facility. So we are really pretty excited about coming to the end of really the big capital build portion of our activity and the fact that we now can start to bank many of the benefits from those investments. I'm sure that everybody will be keen to hear our view on some of the industry shaping initiatives that have been announced, particularly out of the US. I mean, what a roller coaster we've had over the last four or five months, and I'm sure that's the same for Australia. observers of any sector at present, with the imposition of tariffs, with the imposition of export controls, with the release of some of those export controls, and then leading through to some of the announcements out of the US last week with respect to industry building. On balance, our view is that developing a vibrant outside China industry will be good for everyone, for all participants, but it will be best for us because we are today the only scale producer of light rearers and heavy rearers and we are an efficient producer and I think as we've seen at times over the past decade in particular, having our assets in place and operational when the cycle turns, and we are looking at some very positive moves in terms of price right now, means that we can take full advantage of that upswing. Of course, for us, Our heavy rare earth production is key to our competitive advantage. It's important because we could certainly on current production rates be sold out several times over. It allows us to participate in segments where sensitivity to pricing is much lower than in some of the magnet supply chains. And it gives us an opportunity to bundle material with our NDPR and be able to meet the needs of some of our most strategic customers so that, I sometimes joke internally, so that we can be the wife rather than the mistress, you know, so we can actually provide the full suite of materials to these strategic customers. Our task now is looking at the next stage of production of heavies, and as everyone knows, we have the project in the US on which work continues, but as well as that, we are looking at additional opportunities to increase output from our Malaysian facilities. So all in all, we see this as a pleasing end to the 2025 financial year and are looking forward to 2026 with a great deal of enthusiasm. And so with that, I think that it's a good idea to move straight on to take questions.

Thank you. As a reminder, to ask a question, you need to press star 11 on your telephone. Kindly limit your questions to one question at a time. If you have a follow-up, please rejoin the queue.

Our first question comes from Daniel Morgan from Baron Joey.

Please go ahead.

Hi, Amanda and Tim. The first question is, well, it's all going to be pricing. Firstly, a direct question. Did you sell any DY and TB in the quarter? And then I note your comments in the release where you say you're selling some product without respect to China market indices. Is that just with respect to DY and TB or is there some NDPR which you're bundling or otherwise which is not linked to China prices?

Thank you. Thanks, Daniel. So, yes, we have sold some GYNPB. We are being very... In some of the segments that we will now be able to participate in, there's a longer trial period, and so we have samples at a number of customers, but we're pretty confident about those converting as well. We have been very cautious in the quantities that we have sold and the customers to whom we have sold those because we do have limited material at this stage, but yes, we have sold it. And yes, we are significantly advanced in some cases and have sold to others, bundled offerings which actually see us with a different approach to pricing than has been standard in the industry for some time. I think the issue of whether we end up with two levels of pricing. I actually don't believe that there's likely to be two different pricing formats. I think that the value comes and we're seeing a little bit of this at present in the market price moving up to a level which is at a more sustaining level for industry development.

Thank you. I'll rejoin the queue out of respect. Thank you.

Thanks, Danielle.

Thank you for the questions. We'll open for the next question. Our next question comes from Rahul Anand from Morgan Stanley. Please go ahead.

Hi, Amanda and team. Thanks for the call. For my one question, I just wanted to continue on from Daniel into the pricing. So if we look at your baseload supply that's going into the JARE contract, I just wanted to go back to that perhaps and get a A quick refresher, if I can. Obviously, my understanding is that the supply rights are until 2038 for about 7,200 tonnes per year. There is a clause in where you detail that contract saying that Linus would not be disadvantaged. So I guess my question is, if you do start getting better pricing for marginal volumes outside those 7,200 tonnes for your NDPR, which are at a higher price, Would the JARE contract then match that price, or are you still embedded with the Asian Metals index price for that contract? Thanks.

Thanks. The contract is silent on pricing mechanisms, so we are not embedded to any particular format for the pricing there. We do have contracts which are structured with reference to industry benchmarks, but that's not compelled as part of the contract. And you are right, the significant point there is that we will make the product available for the Japanese market so long as it is at no commercial disadvantage to Linus. which effectively means, yes, if we can sell at a higher price, then the contract allows us to do that. I say all of that with, at the same time, importantly, to put this in context, today, I know there are many, many projects, but today, RERA's permanent magnets are produced in, in Japan, in Japanese factories in Vietnam, and in China largely, with a very small volume being produced either in Europe or in the US. So this remains you know, sort of an incredibly important market for Linus and the relationship with Jare and with the Japanese government via JogMeg is a really important relationship for Linus. So the way that we manage that relationship is important, but we certainly do have room to bank commercial benefit in terms within the construct of the terms of that relationship.

Got it. Okay, that's helpful. I'll cue back for a second one. Thank you. Thank you.

Thank you for the questions. One moment for the next question. Our next question comes from Paul Young of Goldman Sachs. Please go ahead.

Thanks. Morning, Amanda. I hope you're well. It's been an incredible last two or three weeks. So I'll continue on the questioning around... pricing and offtake, probably the first one is to continue around that contract with the Japanese and talking through either production above 7.2, 1,000 tonnes. So specifically interested in how you're looking at around offtake, timing of offtake for material above 7.2 and how many offtakes you're looking to sign or diversify, just high-level thoughts. And then just your thoughts around MP with the $110 a kilo price. Do you think that this actually sets the benchmark on a fixed price or could we actually see even higher prices?

So with respect to just back to the making products available up to 7.2, that is not I mean, we don't have a contract with the Japanese government to buy product, right? You know, this is that we will make that product available into the Japanese market. We are the leading supplier of fresh NDPR into the Japanese market and we aim to remain there. And I think that it is important to note that the Japanese magnet meters over the past quarter had significantly increased their production off the back of increased demand after all of the concerns about reduction in exports from China. And we continue to see this as a key part of our prosperity is to be working alongside those Japanese magnet makers and ensuring that we continue to grow. However, having said that, Japanese demand is still below the 7.2. So our portfolio of customers includes the magnet makers in Japan. It includes working alongside those magnet makers as they quote on specific pieces of business, as we know, particularly in the automotive sector. An automotive OEM will be setting up a platform which will become their platform for five years and you want to be in there at the beginning. And so we are working alongside those magnet makers to grow into other markets other than just the Japanese market as well. You know, I think once again, you know, this is a sort of core of our business and incredibly important for us that we maintain a strong, positive relationship because this is actually where the market is today and, you know, we are producing, unlike everybody else with their spreadsheets, we are producing and we do have customers and we will continue to supply them. However, having said that, as we've indicated previously, we have direct relationships with magnet buyers in addition to our relationships with magnet makers, and particularly with the addition of the DYTB, we can go into new markets, for example, microcapacitor markets, which are are very positive for us and we see an entry into those markets not just with our heavy but also with higher value, particularly the Syrian materials which are relevant for those particular sectors. With respect to the $110 price protection agreement that MP have agreed with the US and its likely effect in the market, I think it's certainly not clear right now exactly how that will convert into market-based pricing. I think that it has you know, sent a clear message about the determination of the US government to rebuild this sector outside China. And that certainly has a couple of different benefits. One is it gives end users confidence to formulate material. I know that over many years there have been end users who've said, well, gee, we need to invest in alternate technologies because of the supply chain risks associated with rare earths only coming from China. So I think we see a more vibrant and a more buoyant market, generally speaking. And I think that that will underpin increases in the price. Can it go above $110? Yeah, and I think if you read the detail of the deal, that there would be an expectation from the US government that that is likely to happen because they've negotiated upside, share of any upside over the $110 as part of their agreement.

Okay, thank you, Amanda.

Thank you.

Thank you for the questions. Our next question comes from Chen Jiang of Bank of America. Please go ahead.

Morning, Amanda. Thank you for taking my question. Hey, morning. Just not sure how much I can say, but if you can update us on your discussion with the U.S. DOD. because you have been, you know, Linus has been the partner with USDOD over the last three or four years, and you actually signed the contract, you know, backdated, you know, three or four years versus MP. So I'm wondering, your peer MP has secured a great deal with USDOD. Does that mean DOD now prefers MP over Linus? Do you... Do you see yourself in a relatively disadvantaged position versus MP from U.S. DOD and U.S. regulatory tailwind perspective and how do you see yourself positioning into the U.S. rare supply chain development? Thank you.

It's an interesting question and of course you wouldn't be surprised that my first response is I cannot tell you how the U.S. government perceives anything. I'm sure that most people wouldn't wade into that territory. But suffice to say we have a contract. It is an excellent agreement. It is grant funding for that facility and we have the proven track record to actually deliver what we've committed. And so we see our relationship with the US government is still a very positive one. In fact, you know, under this administration, the determination to really fundamentally shift the market dynamics is very strong. And I don't think that any... Any government or customer in the world is keen to trade out one monopoly for a second. And so, therefore, you know, I think that we provide an additional source of material and therefore, you know, sort of continue in a very constructive relationship with the DOD.

Right. Thank you, Amanda. I will call back. Thanks.

Thanks. Thank you for the questions. Our next question comes from the line. I'll reach Spencer from Kennecock Charity. Please go ahead.

Morning, Amanda and Sam. I'm not sure if Paul's on the line or whether he's able to or whether you're able to help me out on the following question, but I'm going to continue along the line of pricing. How do you guys think China... prices respond to that new, let's call it a benchmark, whether it is or not is a different question. I know recent reports that China has actually notified some of the local producers of new production quotas, but they were not publicly disclosed to the market. Just trying to get a feel for what this means for overall global pricing for these products.

So, well, Chris is on the line, who now looks after our sales activities, but having said that, I can probably deal with this in the first instance. So, yes, our understanding, and we have some intelligence on what the quotas look like, but none of it is being formalised, so I don't propose to you know, sort of articulate what those numbers are, except to say that we think that it is, that the sorts of quotas which have been applied are consistent with the sort of language that we were seeing before the tariff blow up from the Chinese, from the China government with respect to bringing in an understanding of the imported material and including that within the quotas. And so what we see inside China today as the export licenses are being issued is we do see growing demand inside China At present, and I think that we can see that, I mean, I think the price of NDPR has gone, the Asian metal price of NDPR has gone up about $12 or $13 a kilo in the past month or so. So, you know, we see that as being very positive. Once again, I can't possibly imagine what goes on inside the heads of the China central government any more than I can what goes on in the heads inside the US government. But it does appear to me that there's a chance that, you know, the fact that the US has been so definitive in its intention to do this that, probably many involved in the industry in China would see that there's little value to cutting the guts out of the price as a strategy. Doesn't mean it won't happen, but it doesn't appear to have the same potential effect that it might have had previously. So therefore, we then move on to what is the key lever that the Chinese still have, and that is that they are still, notwithstanding that we've commenced supply of separated heavies, it is still the primary source of separated heavy rare earths. And so I refer you back to my earlier comments about our ability to separate heavies and the fact that we have heavies in our mountain world ore bodies is a key part of our competitive advantage in this market.

That's helpful. It sounds like, yeah, it's a positive development nevertheless. I'm going to jump back in the queue, Amanda, but thank you for that. Appreciate it.

Thanks, Rhys. Aren't you also very well behaved?

Okay. Thank you.

Thank you for the questions. Our next question comes from David Dekelbaum from TD Cohen. Please go ahead.

Good morning, Amanda and Tim. Thanks for squeezing me on.

Hi, David. Nice to hear from you. Is it late for you?

Likewise, likewise. No, it's actually quite early because right now we have that 15-hour difference than 12, so I wonder. Okay. But I appreciate you asking. In the meantime, I'm hoping that maybe you could share some color. You pointed out, obviously, in the press release and commentary, you guys were, you know, selling at record levels of NDPR in the quarter. How do you foresee the trajectory of that in the ensuing quarters with some of that content that had been produced out of stockpile? And then, as a follow-up to that, obviously, with the heaviest content now, being separated as well and sold, you know, there was a tick up in operating costs. So how do you think about sort of a levelized operating cost now in the ensuing quarters, you know, using this higher capacity levels here?

So good questions. So the first thing, I mean, we didn't significantly draw down inventory. We run and always have done pretty well. minimal levels of inventory for, particularly for NDPR and ND and PR. And remember, and maybe sometimes I forget to remind everybody, that the fact that we can economically separate ND and PR also gives us access to markets that you can't get to with just an NDPR material. So, you know, we might have ended the quarter with a bit less inventory than we started the quarter, but it's not particularly remarkable. Basically, you know, we continue to sell pretty much everything that we produce. and we will continue to balance that as we go forward. But we do hold a little bit more inventory than in the days when we finished the quarter with, you know, maybe 20 tons in the warehouse. So with respect to the costs, I think it's always tricky when you're looking at cash costs, which is what we have in this quarter because, you know, For example, at the end of last quarter, I think the final day of the quarter was a public holiday, so some of those sort of spilled over in cash terms into this quarter. Of course, in the second half of the year, we had the Calhouni costs sitting on the P&L rather than being booked to the capital account. Notwithstanding all of that, even with what has been a pretty soft year in terms of pricing, we have continued to be able to generate positive operating cash. But as we look at our cost assemblage as we move forward, there are pluses and minuses as we bring the Mount Weld project We won't be running from day one at its full capacity, so how do we find a way to actually operate that asset in a way that captures as many cost benefits as we can? Calgouli, our focus has been on getting production ramped up and improving quality. you know, reducing the level of non-rare earth impurities in that MREC because that fundamentally changes the way things operate in Malaysia. And in Malaysia, we are looking at continuing to optimise costs and, you know, it is looking pretty good. So sort of a really key focus on As we get to sort of stable production, particularly in Kalgoorlie, how do we now start to drive some costs out in that area and things like the new gas pipeline and those sorts of things will certainly improve our performance there. So we would expect that we will retain our lowest quartile position in terms of cost of production. And, you know, it remains an area that even if the price goes up, we don't go crazy. We understand that, you know, this is our muscle and we need to remain focused on it.

Appreciate that. Thank you for the question.

David.

Hi, Dr. Hardin. I'll move on to the next question now. The next question comes from John Sharp from CLSE. Please go ahead.

Yeah, hi Amanda and team. Just a question on your downstream strategy. So it seems, you know, you want to, the strategy is to go with an experienced partner, which seems wise. But can you just take us through this strategy of doing it with a partner versus going alone? You know, many potential rare earth producers or even rare earth producers discuss or want to produce magnets on their own. What are your views on execution risk and why did you decide to do or why did you decide that you want to sort of go with a partner? What are the advantages?

Thanks. Yeah, so if Paul was on the call, he would tell you that the first time he saw a presentation saying that a company was going to provide mine to magnets, fully integrated capability was, I think he said in about 1999, and that is yet to actually be delivered. So we have a healthy respect and process of assessing what are we good at and what do we need to get better at and what do we need to learn. And so we are very, very good at understanding rare earth geology, mineralogy, processing. So we're a good miner and we're a good minerals processor. We're also very good at running big complex chemical plants because that's essentially what the rare earth refineries are. You know, there's as complex a chemical plant as you could ever find. And so metal making and magnet making are a different skill. Now, could we learn it? Yeah, I'm pretty confident that we could. I mean, you know, 10 years ago we didn't know how to separate rare earths and we're really very good at that now. So could we learn it? Yes. Will that take time? Yes. Working with a partner who actually has those skills where we can bring the combined value to the activity we think gets us there faster and with less risk. And once again, I point to the fact that notwithstanding many, many PowerPoint presentations for Mind2Magnet, we've not actually seen that executed. And we've put execution at a high premium in our company. So we see that the path that we've chosen to do this in partnership is likely to get us to market sooner with a better product.

Okay. Thanks, Amanda. Thank you.

Thank you for the questions. Our next question comes from Austin Yun from Macquarie. Please go ahead.

Morning, Amanda and Tim. Just a quick one on the project of the Kigali facility. You mentioned in the report that more work will be put into this project for the ramp-up. I just wonder if you have a new timeline on when you can ramp-up to the 10.5-mile challenge. and also any colour on the CapEx outlook, do you think more cash into this project regarding the modification work?

Thank you. There is no significant additional capital needs to go into Calgary, you would be pleased to know, having made such a significant investment there. What we're really talking about here, and we saw this also as we developed the lamp over the past decade, is that this is not just a simple flick the switch and everything will be fine. We are dealing with a complex process, and as I indicated, the primary focus is really about dealing with non-rare earth impurities and the fact that we had an initial flow sheet which was developed on the assumption that we would not have cracking in Malaysia and now we do. It actually just has given us a few more challenges around the way that we introduced the two materials into the facility in Malaysia. well progressed on that where we don't need Calvuly to be operating at nameplate to be able to get to the 10.5. The 10.5, but we do need it to be producing reliably at sort of a More than we would say that we have achieved, we can produce at the sort of rates but not the qualities that we want for execution in Malaysia. But, you know, I mean, these are issues at the margin. Our focus on the 10,500 tonnes a year is It's more to do with how do we assess our ability to put this into the market in a way that maximises our prices and returns than specifically on, you know, sort of operating parameters.

Thank you, Amanda. I'll cue again for the quick question.

Thank you for the questions. Our next question comes from Regan Burrows from Bell Porter. Please go ahead.

Hi, Amanda and team. Congratulations on a good finish to the year. It looks like you probably got a premium on your NDPR product in the realm of 15% to 20% over the quarter. Just curious, how sensitive are your Japanese customers to that increased pricing regime? Like if we compare it to the DOD MP arrangement, The DOD is the backstop there, so the end customer doesn't effectively pay any more for the material, which makes me think that they are sensitive on pricing. Just curious how – whether that sort of shifts your view and whether your Japanese customers have a similar view.

I'm not sure that that interpretation is necessarily correct. You know, I mean, the – Yes, there is a backstop to the 110. But, you know, if you read the documentation, there's an expectation that product will be sold at commercial rates. So I would expect that, you know, we would hope that we continue to see the strengthening of the market. And in that case, then, the Japanese magnet makers will be at no competitive disadvantage. Okay, thank you. Okay, thank you.

Thank you for the question. Yeah. Our next question comes from Dim Aryasinghe from UBS. Please go ahead.

Thanks, Amanda. Congrats on the result. Hi, Dim. G'day. How are you? Good. How are you? Yeah, not too bad. Better off the result. Maybe if you could just help us on JS Link, and apologies for my ignorance, but I agree it's probably better going downstream with a partner that has experience in this sector, but can you maybe enlighten us as to what that is, and then... be so bold to ask, like, are they willing to pay a higher price for your rare earths versus the benchmark?

So I will invite Chris to make some comments on JSLink in a moment. I think that I have indicated on some other calls that we've had that we see significant potential value from... There's been investment across the Korean sector in developing rare earths and this doesn't surprise you because why do you have to have rare earths? You have to have rare earths for automotive and electronics and what are key growth industries in Korea, automotive and electronics. You know, we are engaged, there are two or three different Korean either currently producing magnets, although in relatively smaller quantities than, say, the Japanese and the Chinese. But we see this as a key growth sector in the market, partnering effectively. with producers and customers in Korea is certainly part of our sort of view of the world moving forward. With respect to Malaysia, of course, you know, for the Malaysian government, Linus has always been a part of, it becomes a foundation for more industrial growth around it, which is why we're focusing on both of what are opportunities for development of upstream and also what are opportunities for the development of downstream. And so we are delighted with the fact that we've been able to sign this with JS Link who have indicated a preparedness to invest in Malaysia. It doesn't mean that we won't engage with Korean magnet makers who are either investing in Korea or indeed in Vietnam. But Chris, maybe I could hand to you if you wanted to say anything more about JSLink.

Yeah, thanks, Amanda. Yeah. So JSLink, they're one of the newer magnet-making operations out of Korea. And they're publicly listed for building a facility in Korea. They're also looking at overseas expansion. And they've got some great technology and a very strong management team. Yeah, and really, I think it's just another step forward in creating the new outside China supply chain. So I'm very excited about the news and look forward to working very closely with them.

Yeah, thanks. I mean, like the way I'm reading it is that, you know, with this announcement, you've got more clarity on ex-China NDFPB capacities, another 3,000 tonnes, which is maybe 1,500 tonnes of NDPR, give or take. The biggest pushback, I think, to the stock was that you didn't have ex-China capacity to deliver into. That's changing quickly, I think. So, yeah, thanks. Thanks.

That is right, Dem. It is, you know, the more that the downstream grows outside of China, the better it is for us. And so, you know, we are very focused on developing those relationships and working alongside, you know, those that we see are going to be investing and developing their business in this area.

Thanks. Thank you for the questions. Our next question comes from Al Harvey from JP Morgan. Please go ahead.

Good morning, Amanda. Hi, Al. How are you? Very well. Just interested in your comments and your advancements in Malaysia, just given those two recently signed MOUs. I was just trying to get an understanding of the upstream versus the downstream. I suppose given you've got a lot of latent capacity, upstream at least, across existing infrastructure, maybe you can help us understand why more upstream in Malaysia is important. Is it really around those other comments you mentioned in Jim's question around helping Malaysia with more industrialization and developing, improving the relationship there, or is it something else?

The upstream, as I think everybody who's even a casual observer of this industry knows, the ionic clay deposits will have a slightly different assemblage of rare earths. So we see that there is benefit from that, potential benefit from that for Linus. And then most certainly we also see that the... the benefit of really contributing to Malaysian prosperity will be good for our business.

Thanks, Amanda. Thank you for the questions. One moment for the next question. Our next question comes from Mitch Ryan from Jefferies. Please go ahead.

Thanks, Amanda, in terms of the question. Just following on around the JS League MOU, Does it preclude you from entering into similar agreements with other magnet manufacturers? And yeah, that's probably the key part of the question.

No, it does not.

Thank you for the questions. Allow me to move on to the next questions. I'll pull up questions from Daniel Morgan from Baron Julie. Please go ahead.

We're back around.

Amanda... Back to the beginning again. Well, that's good because, you know, it's 10.52 already. Yeah. Okay.

Sorry, Daniel. That's all right. So on to... Obviously, you don't provide a lot of quantitative guidance, but if I may, I mean, you've had a long period of investment in lots of new capacity, and your cash balance has obviously dwindled while that occurs. That's understandable. We haven't got CapEx guidance or cost guidance for the year ahead, but maybe a simple one. Do you think that from here, the next quarter, is it a time where we start making free cash flow and adding back to the cash balance, or is there still investments that need to be made that might mean that's not the case?

Yeah. I think we actually have indicated previously that we did see FY25 as, you know, sort of the end of the significant, certainly of the Linus 2025 capital. And, you know, to stop growing, you know, to stand still is, you know, sort of not a great place to be. So will we be looking at other opportunities for investment? Yes, but we are substantially complete. There will be some trailing capital payments, you know, because we didn't feel it necessary to pay everybody before the year ended. So there are some trailing capital payments but no further commitments, significant commitments associated with you know, Matt World Expansion or, you know, Linus Kalgoorlie, which were the two really big projects as far as this was concerned. As we look forward, will we look at other investments which may include, you know, sort of... increased capacity for heavies in Malaysia and various other areas, yes. But we are very focused internally on the fact that we've spent this money on upsizing our capacity and, you know, our job now is to make sure that we deliver a return on those investments.

Thank you very much.

Thank you for the questions. We also have follow-up questions from Paul Young of Goldman Sachs. Please go ahead.

Thanks, Amanda. Yeah, back again. Amanda, a question on the next 12 months. I know it's all about the big picture, though, from a perspective that, you know, you ramp to 10 and then you look at options beyond that. Sorry, ramp to 12 and look at options beyond that and further to your comments just then. But just on the next 12 months and looking at the ramp-up in that world, which is actually going really well and you'll be producing first flotation concentrates September quarter and I'm sure Chris Teresi will ramp this one up quick. But when you do ramp this up over the next 12 months, considering that the Japanese can't take all the 7.2, the three customers, what happens here? Do you, A, sell excess production to China? B, do you stockpile the oxide material like MP is doing? Or C, do you slow down the ramp up after you've tested in our world?

It's most likely slow down the ramp up after we've tested to pull. I mean, we can look to different ways to manage or to operate. We can look at do we run sort of a quasi-batch sort of campaign-based approach We did that at Mountwell for many, many years, very successfully, as we were sort of improving performance in Malaysia. So there are a variety of pathways available to us, but for us, producing to a stockpile, we don't see as being, on the face of it, particularly attractive. maybe carrying a bit more inventory, as I said earlier, than we have traditionally done could have some value to it. But we think that the sensible thing is to match to the market rather than to, you know, sort of everyone get a rush of blood to the head and end up, you know, sort of producing it at rates that flood the market. So, you know, that will be the way that we look at it. You know, you can't bank a tax and you can bank a dollar.

Yeah, got it. So basically you're saying you're matching to the ex-China market effectively.

We have some customers inside China, Paul, who have been our customers for many, many years and who have been good, faithful and loyal customers and we would expect that we will continue to do business with them, but yes, our primary market is outside child.

Yes, understood. Okay, thank you, Amanda.

Thanks.

Thank you for the questions. Our next follow-up question comes from Ray Spencer from Kennecott Genentee. Please go ahead.

Thank you. It looks like I've just got squeezed in before you cut me off on the hour. Amanda, just a quick question on Texas, noting your comments that It looks like there's a bit more engineering and the likely impact on capital. More interested about the product that might come out of the Texas heavies plant. And I know you don't like to talk too much about what MP is doing, but if you have a look at their plans for manufacturing capacity expansion, one thing I think everyone can agree on is MP don't have a lot of heavies. How are these I think Texas, what you're doing in Texas might fit into the broader strategy of the DOD to build out that maintenance supply chain there. Could you be a customer, for example, of that maintenance facility? Yeah, I'd be interested in your comments on that. Thank you.

You mean a supplier?

Yes, correct, direct supplier.

Potentially, yeah, sure. I mean, you know, we are in the business of making product and selling product. So if we have someone who wishes to sell it, to pay us for the product that we produce, then we will certainly give that to you consideration.

Excellent. Interesting times. Thanks, Amanda. Really appreciate it.

Thanks, Rhys.

Thank you. Our next follow-up question comes from David Deckelbaum from PD Cohen. Please go ahead. David, your line is open. Please go ahead.

Thank you. Just to square all the comments at a high level, when you think about the 12,000 ton expansion and ERAC capacity, you referenced the Japanese market before. Any agreements there? How do you sort of envision the split of Japanese sales versus ex-Japanese and ex-China sales once you're at full capacity based on what you think in terms of the Japanese market growing and the requirements to serve that market?

That's a very big question, David. I think that we see that Japan remains our foundational volume market and We had extremely strong relationships there and good, strong contracts. The Japanese magnet makers are more than competent. I mean, they invented, the Japanese material scientists invented rare earth permanent magnets. They still know more and have more technology than most other magnet makers in the world. And in fact, you know, the things that really on a number of items, you know, which are definitely gaps for some of the aspirational magnet makers outside of China. The Japanese have the technology, but some of these others do not, and so therefore are unable to capture the same sort of economies that the Japanese magnet makers can. So we do see that our rock-solid foundation remains our relationships with Japanese magnet makers and Japanese magnet buyers, of course, and also with other segments in the Japanese market, whether it's AutoCat or MLCC, the microcapacitor market, or it's in electronics as well as in automotive. As I mentioned before, we are working very hard with a number of the sort of aspirational or existing, you know, a focus first on those who have a proven capability like the Korean magnet makers to grow that business. And we see that as being... very, very positive and probably, you know, sort of a significant sector in our business portfolio as we move forward. And then, you know, as we see the development of magnet-making capacity in the US and or Europe, we, you know, are engaged both with those potential magnet projects but also with the magnet buyers. So, you know, Japan will remain sort of key. I think that at least for the next few years, we would see that East and Southeast Asia remains, you know, sort of the key engine room of the rare earth market. But we are happy to partner and to support development of capability outside of that jurisdiction. as it develops.

Thank you. In the interest of time, we'll now take the last questions from Austin Yun of Macquarie. Please go ahead.

Thank you, Amanda. Just on your comment that, you know, your production will match the future demand and the conscious that there are not many magnetic facilities outside of China, is that correct to understand that your future production expansion plan going to be able to buy additional JV announcements as the way you announced today with GS Link. So there should be more similar partnerships to be announced in the next few years. Thank you.

Oh, Austin, you know that I don't announce ahead of time. I think that we... You know, we assess every opportunity on its merits. There we go. But we are a serious player in the rare earth market. It is our core competence. We wake up every morning thinking about it right across our business. And so therefore, we will participate in this market in the way that is going to deliver best outcome for all of our stakeholders.

Thank you for the call. I would like to hand the call back to Numanishan for closing.

Okay. So once again, thank you all. And I'm sure that we will be speaking again soon. in relatively short order as we next month bring forward our annual results. Hope you all have a great day.

That has concluded this conference call. Thank you for your participation. You may now disconnect your lines.