Mineral Resources Limited

Thank you for standing by and welcome to Mineral Resources Call, covering today's release of its June 2026 exploration and mining activity report. The speakers today are Mark Wilson, Chief Financial Officer, and Chris Chong, General Manager, Investor Relations. A little bit of admin before we kick off. Participants will be able to ask both text and live audio questions. To ask a text question, Select the messaging icon, type your question in the box towards the top of the screen and press the send button. To ask a live audio question, press the request to speak button at the top of the broadcast window. The broadcast will be replaced by the audio question screen. Use the dial-in number and access pin provided to ask your question via the phone. Alternatively, for those on a home or personal network, you can ask your question via the web by pressing Join Queue. If prompted, select Allow in the pop-up to grant access to your microphone. If you have any issues using the platform, dial-in details can also be found on the homepage under Asking Audio Questions. Text questions can be submitted at any time and the audio queue is now open. This call is being recorded with a written transcript being uploaded to the MNRAE's website later today. I will now hand over to the MinRES team.

Thanks, Michelle. Good day, everybody, and thank you for joining us. My name is Mark Wilson. I'm the CFO of Mineral Resources. Joining me in the room today are Malcolm Bundy, Independent Non-Executive Chair, and Chris Chong, General Manager, Investor Relations. I'll start this morning with a few opening remarks on the quarter and on the full year before we move to questions. The June quarter closed FY26 on a record note. We had our strongest quarterly mining services volumes on record. Onslow Iron averaged a run rate of 38 million tonnes per annum and we had record quarterly attributable spodumene sales of 158,000 tonnes on an EC6 equivalent basis. For the year as a whole, FY26, we exceeded volume guidance at Onslow, Iron and across both lithium operations. We delivered mining services volumes above the top end of upgraded guidance and we maintained cost discipline throughout. That's a strong result by any measure and it reflects more than just one quarter of delivery. It demonstrates the quality of the business we have built, the benefits of deliberate investment decisions made over several years and the performance of assets that are now maturing towards their potential. I do want to acknowledge the significant efforts of our teams across every part of the business to deliver that outcome. To put FY26 in context, across our three operating pillars we delivered records in mining services volumes, lithium sales and iron ore shipments. We did that while significantly reducing our cost of debt and strengthening our liquidity position by $1.3 billion. This is a business that is executing well, generating stronger cash flow and entering the new year from a significantly stronger position than a year ago. Looking ahead, we enter FY27 with positive momentum, a materially improved balance sheet and a clear set of priorities. Starting with the balance sheet, which continues to rapidly strengthen, liquidity improved to $2.4 billion at 30 June, up from $1.8 a quarter earlier, with our cash position up $600 million. Net debt reduced approximately $200 million to below $4.3 billion, continuing our positive deleveraging trend. The distinction between the $600 million improvement in our cash and the $200 reduction in net debt reflects the refinancing of our iron ore prepayment, which is previously classified as a non-debt liability. Regarding the refinancing in April, we issued US $1.3 billion of new senior unsecured notes at our lowest ever rates of 6% and 6.25%. This transaction reduced our weighted average cost of debt from 8.4% to 7.4%. extended our weighted average tenor from 3.1 years to 5 years and saved us approximately $48 million per year in finance costs. On completion of the POSCO transaction, the residual US $750 million of bonds due October 28 are expected to be redeemed, reducing our weighted average cost of debt further to 6.9% and saving approximately a further $100 million in interest annually. The Onslow Iron Carry Loan reduced by $124 million over the quarter to $335 million, and as Onslow Iron continues to generate strong cash flows, we expect this balance to continue to reduce materially through FY27. Additionally, we had a working capital inflow in the quarter of $250 million, which is primarily related to an increase in payables as a result of timing and also increased activity. and this is expected to largely unwind in this new quarter. FY26 capital expenditure came in at $1.1 billion, net of asset financing of $110 million and in line with our guidance. We will provide guidance for FY27 CAPEX at our full year results later in August. Our capital allocation remains disciplined in line with our updated capital allocation policy with FY27 growth capex focus on brownfields opportunities with assets we already own and operate. That growth capex and FY27 will include brownfield investment at Moundup Marion and Onslow Irons to support productivity, capacity and long-term operational capability. Turning to mining services, the growth engine of mining at Minres, the division had an outstanding quarter. Quarterly production volumes were a record 94 million tonnes, driven by an increase, particularly increased volumes at Onslow Iron and increased activity at Mount Marion. For the full year, FY26 production volumes were a record 341 million tonnes, up 22% year on year. and above the top end of our upgraded guidance range. In iron ore, Onzo Iron produced 8.8 million tonnes and shipped a record 9.6 million tonnes in the quarter on a 100% basis. That's an extremely strong finish to the year, which is equivalent to achieving a shipped 38 million tonne per annum run rate for the quarter. For FY26, attributable shipments of 19.7 million tonnes exceeded the top end of our upgraded guidance. Total FY26 shipments were 31.1 million tonnes on a 100% basis Realisations for Onslow in the quarter were 82% and this remains consistent with broader market conditions FOB costs for the quarter was $53 per tonne bringing full year FOB costs to $52 per tonne below the lower end of FY26 guidance This result confirms Onslow Iron is a large scale operation now performing consistently and generating cash at scale. Other highlights worth noting, including the arrival of the sixth transshipper in May, with the seventh transshipper now due to arrive in early August. With the seventh transshipper, our Morang logistics system will have greater flexibility and redundancy as we move into FY27. Post quarter end, unplanned maintenance works are being conducted at the port in load. This is expected to have a minimal impact on Q1 volumes as other planned maintenance works scheduled for August have been brought forward. In the Pilbara hub, shipments increased to 2.7 million tonnes, of which 34% was lump, with the ramp-up of Lamb Creek progressing well. Realisation in the quarter was 83%, reflecting the widening of discounts, but partly offset by sustained lump premiums. FY26 shipments of 9.9 million tonnes achieved the upper end of guidance, and full-year FOB costs came in at $79 a tonne, in line with guidance. Lithium. Our lithium division closed out the year strongly on volumes. Sales from Wagena and Mount Marion totaled a record 158,000 tonnes SE6 as I said earlier and achieved an average realised price of US$2,425 per tonne SE6 basis. At Wagena, sales for the year were 317,000 tonnes SE6 outperforming our upgraded guidance. This was driven by increased utilisation of the three processing trains. FOB costs for FY26 at Wozina was $738 per tonne SE6 achieving the lower end of guidance. At Marion sales for the year total 242,000 tonnes exceeding the top end of upgraded guidance. The FOB cost of $847 a tonne for the year on the SC6 basis was within guidance. As we've said previously, FIG was taken in May with our joint venture partner, Gangfeng, on an investment in the flotation plant and a recommencement of the underground development. And earlier this month, McMillan was appointed as our underground mining contract partner. Ball Hill operations restarted in May. This is a meaningful step in our ability to flex according to market conditions. Subsequent to the quarter, we shipped our initial parcel of spodumene concentrate and ramp up to full capacity of 140,000 tonnes per annum remains on track for Q2 this new financial year. Across the lithium portfolio, The key point is that the work undertaken through the cycle is now translating into higher volumes, improved operating flexibility and a stronger platform for future returns. Turning to safety, on safety as flagged in the previous quarter, the company has completed a comprehensive review of its injury and illness classification procedure. Following this review, the procedure has been revised to align with global industry standards. This does not reflect the change in underlying safety performance, but is a deliberate decision to hold ourselves to a higher reporting standard as our business matures. In closing, FY26 was a year of significant progress operationally, financially and strategically. We remain fully focused on delivery. We achieved or exceeded guidance across every segment, We strengthen liquidity to $2.4 billion and net debt has reduced to $4.3 billion. Our cost of debt is materially lower, our maturity profile is extended and our debt reduction trajectory is clear. We enter FY27 with well-established earnings drivers in Onslow Iron, Lithium and Mining Services, strong liquidity and a pipeline of low risk, high return brownfields investments and mining services opportunities that we are progressing with discipline. With that, I'll now hand back to the facilitator to arrange questions. Thank you.

Thank you, Mark. If you have not yet submitted your text question or joined the live audio queue, please do so now. I will introduce each caller by name and ask you to go ahead. You will then hear a beep indicating your microphone is live. Our first question comes from Kate McCutcheon from Bank of America. Kate, please go ahead.