Lynas Rare Earths Limited

Thank you for standing by and welcome to the Linus Rare Earths Half Year 2026 results briefing. 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 1 on your telephone keypad. I would now like to hand the conference over to Linus Ray Earth. Please go ahead.

Good morning and welcome to the Linus Rieris investor briefing for the half year ending 31 December 2025. Today's briefing will be presented by Amanda Lacaze, CEO and Managing Director and joining Amanda today are Gauden Sturzenegger, CFO, Daniel Havis, VP Strategy and Investor Relations and Sarah Leonard, General Counsel and Company Secretary. I'll now hand over to Amanda Lacaze. Please go ahead, Amanda. Thanks, Jen. And good morning, everybody.

Thank you all for joining today. I always think that it's a bit funny. You can see me, but I can't see you. But I hope that you're all well and, you know, I'm pleased, you know, incredibly pleased to be able to do this presentation. The first half of FY26 has been one of those sort of half years where we were very busy, but it's really only in retrospect that the scale of what we were able to achieve has been properly illustrated. So I think it will be helpful to really step through the presentation that we launched today. We've got the obligatory disclaimers and we have the important recognition of country. as an operator in Australia, in the mining sector, acknowledging and respecting the traditional owners of the lands on which we live, work and meet across Australia is important. And in particular, acknowledging and valuing our Aboriginal and Torres Strait Islander employees, partners and communities. So in the year to date, as I said, in the first six months of this year, we were busy. But, you know, as we look back on it in the rear vision mirror, gosh, we were really busy. Many achievements. So, you know, for a long time we've been talking to you about the Linus 2025 capital projects. And during this, you know, first six months of this financial year, a lot of milestones have been achieved with respect to those. The Mountwell expansion project has been largely commissioned with the new flotation circuit operating at 70% of nameplate. I know that oftentimes, you know, it's sort of people will look at Mount Weld and they'll just think, oh, well, you know, we know the Mount Weld resource, we know the beneficiation circuit, all of this is pretty easy. I just would like to remind everyone this is a big, complex project, as big as many other mining firms in Australia who don't do any processing past that initial beneficiation. We've had to commission three new mills. We've got new processes. We've got significant investment I'll talk a little bit more about with water recycling. And so all of these things, you know, it has been a complex commissioning and process and ramp up process. And I'm really pleased with the progress that the team has made. Also of really important note is our 65 megawatt hybrid renewable power station is operational and you can see some of the photos further on of the new wind turbines. The ramp up at Kalgoorlie continues. We've undertaken a number of process modifications there to improve its performance. And I think as everybody knows, it has not been without its challenges, both internally and most particularly externally. It's very difficult to run a big complex plant like Kalgoorlie without reliable power. In Malaysia, where I think that we often don't put quite as much focus as we're talking about these things, there have been significant changes implemented as part of Linus 2025. The uplift in production capacity, the processing of mixed rare earth carbonate and, of course, you know, we had our first full six months of separation of dysprosium and terbium. So having done all of those things and, you know, we've drawn the line under the Linus 2025 capital program, it's really about how we're setting up the business for the next growth phase. And, you know, we started with the capital raise. We've announced the larger HRE separation facility that will go into Malaysia soon. We've announced some elements of our contribution to continuing industry development, including in metal and magnets, but also in terms of resource development. So as we look at all of this, I am minded to remind everybody that this is complicated and I think I have mentioned it previously, but I would recommend to any sort of observer of this market a particular study done by an engineer, Jen can provide information on this, but, you know, a consulting engineer on ramp-up curves for critical minerals and the fact that, you know, if you use McNulty, which is a one-to-five in rare earths outside China, you know, you've never had anyone who's, or even critical minerals projects generally, you've only had one or two projects, and this includes things like vanadium and nickel as well as rare earths and a variety of other materials that has ever come close to a McNulty one or two, which is the fastest, most trouble-free ramp-up. And in other sectors, you know, Linus has performed best, you know, and we were at a McNulty 4 ramp up in Malaysia and then we jumped up to a McNulty 2 in around about 2016. um it is easy because we are an established player for people to think oh well we've just brought on a new facility here and brought on a new facility there and you know everything's fine but I would just remind everybody of the the complexity and the value that derives from the fact that we are an established and experienced operator and indeed have been able to bring our new assets online. Not trouble free, that would not be fair to my operations team to say that, but certainly in very good order. And we continue that ramp up as we speak. We continue to put safety at the heart of everything that we do. um and i was talking to our board about this and uh as we were thinking about you know how did we present some of this safety information and i made the point that it you know it's it's a little bit disappointing in some ways that we hardly ever spend any time on the safety slide externally we spend a huge amount of time however on safety on on personal and process safety inside the business. And, you know, I would also take this opportunity to remind everyone that, you know, Australian mining leads the world in terms of both our approach and our performance with respect to safety and other sustainability practices. We're incredibly proud that the major maintenance that we undertook in Malaysia late in the second quarter, which involved over 30 subcontracting companies and 100,000 work hours, was executed to schedule and without injury. We're incredibly proud that Mountwell and Kalgoorlie employees achieved 12 months without any recordable injuries in December 2025. And as our projects now move from commissioning to operations, we are very focused on our yes, we care HSE strategy, because yes, we really do care that everybody goes home safely and well every day. Then if we look at our financials, well, This is, you know, very pleasing for me as I make my last half-year report to be able to report such an excellent result. I'm also a bit sad that the next CEO will get all of the second half glory because as we've foreshadowed in our announcement, you know, we expect that the market settings will continue to be positive. And I think everyone who's been following Linus for some time would appreciate we are the only company that can take full advantage of the positive market settings because we are the company that is operating and producing today not just lights but also heavies. So excellent performance, sales revenue, net profit after tax, EBITDA all up, and, of course, we had the big jump in cash and short-term deposits as a result of the capital race, which is setting us up for towards 2030. When we look at it operationally, and this is one of my favourite photos, and I think some folk have been in Malaysia in the last six months and would have seen this new part of product finishing. And it is just beautiful. It's part of our uplifting capacity that we have available to us now in Malaysia. So NDPR production was absolutely on track for record six months until we hit the problems with power in Kalgoorlie. So we're just a little bit off. And as you can see from this, we're starting to roll off in terms of sort of final payments related to the capital program of Linus 2025. Looking at that sort of with a bit of history, you know, we've just put in the half years since FY20. You can see that we are, you know, sort of consistently increasing like on a rolling 12-month basis. We've certainly had, and rightly so with all of the investment that we've made, we continue to set new production records. As I say to our operations team, every month should be a record as we continue our ramp up of the new facilities. And then, of course, you can also see the benefits that come from the increased benchmark selling price. So the benchmark is moving higher, but our internal measure is how much we can beat that benchmark by as a result of our efforts and our negotiations with various customers. The market generally is very constructive right now. You know, as we've indicated, the price in December 2025 for NDPR was sitting at $74 a kilo, compared to $49 in December 2024. That price has continued to firm, and yesterday we reached... over the sort of magic $110 a kilo mark. And this really reflects a number of things. It does reflect the government actions in... which is really starting to reshape the market. We are seeing governments, you know, Australia and Japan, EU and, of course, the US, taking action to create a functional market. We have never asked for subsidies, but there is no question there has been market failure for many years in the rare earths industry. And enacting policies which ensure that the market is functioning properly, we think is really important. And as those policies are implemented and the market responds, then, you know, the potential cost to government just goes down, you know, I mean, like at present. As the price sits above the $110 NDPR floor price, I'm sure the US government is feeling very relaxed. We continue to be engaged closely with relevant governments, and I'm sure many people will have read various articles on the likelihood of governments other than the U.S. government also putting in place policy measures to facilitate a proper functioning market. So for us, huge opportunities. We make lots of NDPR and we make now DY and TB. These are the products in greatest demand in terms of total volume and we will shortly be producing some other materials, particularly samarium, which we expect to come through before the end of this financial year. I was hoping – and then it will follow up with gadolinium and yttrium and then other elements as we bring our new production facility in Malaysia online. Japanese magnet makers are winning new business. Ex-China magnet buyers are seeking direct supply to mitigate supply chain risks. As recently as yesterday, we had – Chinese indicating further controls on materials to be exported to Japan. We have a very long-standing and productive relationship with our Japanese customers, and this certainly provides an opportunity for Linus. And we are seeing significant demand for our bundled lights and heavies, you know, sort of being able to sell these together in the ratio that customers require them gives us a significant competitive advantage in the market. So we are, this says we can capture value. We are capturing value from the current market upside. Just then just, you know, everyone can step through. I love this picture of Mount Weld. We've gone from this tiny baby little, you know, sort of concentrator which is sitting sort of in the sort of top right-hand corner there below the processed water pond. On your top left, I think it's quite helpful for people to see, those are our tailings dams. But as you can see, they're like a beautifully sort of ploughed field, not ready to be sown with wheat, but certainly ready to be remined and put back through our processing facility. Some of the elements of the new beneficiation plant means that we will be able to liberate some of the materials which we did not recover in the first instance. And in those tailings dams, you know, facilities, we've actually been able, you know, to track the rare earths concentration at somewhere around about 77.5%, which means that in and of itself a highly valuable mineral resource. Kalgoorlie continues to ramp up. Oh, sorry, I missed. No, Jen, you can go back. You can see three of our four wind turbines there. This is just terrific. We are so pleased with the new power station. It is not cheap. I do get frustrated when people talk about how the unit cost of a kilowatt hour of renewable power is cheaper than any other option. That's true, but only after you've covered the capital cost of the four wind turbines and two and a half thousand solar panels and the gas turbines which need to be there to provide baseload power and the batteries as well. Having said that, it is true that on a variable cost basis we now have electricity which is significantly less costly than our previous diesel power station, but more importantly You know, we are really, really pleased that we've been producing, you know, in December 92% of our power has come from renewable electricity. The wind at night has been better, a better source of power than we were expecting. And the power station is performing better than our initial target of 70% renewable content. So really very excited about that. And the second really significant initiative as part of the Mount World expansion is was commissioning some of the new water treatment facilities with our objective to achieve 90% of our tailings water to be recycled. We've been able to demonstrate that we're not yet reliably and sort of delivering at that level, but we are confident that we will get there. And then Kalgoorlie. Kalgoorlie, I think I've said previously we need to recognise there are two parts, cracking and leaching. We have many skills when it comes to, you know, sort of cracking, rarest ores in our company and the cracking and leaching part of Kalgoorlie is actually running pretty well notwithstanding the outrageous, frankly, power disruptions that we had during the second quarter, the carbonation circuit, As with all new processes, we've found as we've ramped it up that, you know, bottlenecks move around and that we need to enhance or improve certain processes. And we are doing that in a very managed and measured way, just like we did when really when we were wrapping up the lamp 10 years ago. And so Kalgoorlie continues to improve, but not yet where we would like it to – quite yet where we would like it to be on a long-term basis. And then Linus Malaysia is, once again, you know, not giving me any – sleepless nights at all. You know, the Malaysian plant is running extraordinarily well. Particularly we're seeing the benefits of the major maintenance on the cracking plant in the second quarter. It's running better than it has ever run in its life. the new separation circuits are stable and producing and really it's just a case of can we keep feedstock at the sorts of rates that we want them to. I think as we said, we produced DY and TB last year and we've announced the new expansion, heavy rare earths expansion plant and we expect samarium production Soonish. So all looking very good in Malaysia as well. In the U.S., you know, the U.S. has, well, boy, has the U.S. government really, you know, sort of discovered rare earths. We have continuing discussions with the U.S. government, particularly with respect to an octane agreement, which is acceptable to us. Having said that, our engagement with particularly U.S. defense industries is really strong, and we are selling material into U.S. defense industries at scale. very pleasing prices. We've also taken the opportunity to do a little brand promotion. I thought everyone would like to see our billboards as they were in various locations in Washington. So just, Jen, moving on to the next one. I've really already talked about the hybrid power station and Okay, now we'll move on to communities. And I think everybody who has even spent a few minutes with me over the years knows my view, which is that we cannot prosper if the communities in which we operate do not prosper as well. So in each and every one of our locations, we are incredibly connected to community and We think that it is a really important part of our success and also our culture. And I look at the faces whenever we have these photos. I look at the people that, you know, our people who are engaged in this. and community events, and I'm just really proud of them and really proud of the contribution that we make to improving the lives of the people who both work for us but also, you know, their families and their community. So with that, I am very happy to... Oh, yeah, then we got the stuff about people. Then I'm really happy to take questions.