South32 Limited

Good morning, everyone, and thanks for joining us today. On the call with me is our Deputy CEO, Matt Daly, for his first call, our Chief Financial Officer, Sandy Sibenala, and our Chief Operating Officer for Southern Africa, Noel Pelé. I'd like to start with safety, where we're seeing improvements in key measures following our sustained effort to improve performance through our Global Safety Improvement Programme. During the half, we achieved further improvement in significant hazard frequency, which demonstrates improved hazard awareness and a more proactive reporting culture. We're also seeing positive reductions across our lag indicators. While the data is encouraging, we're determined to continuously improve on our safety performance. Turning to our financial results, I'm pleased to say that we have delivered strong financial results for the half, underpinned by our operating performance and higher prices for base and precious metals. Our FY26 production and unit cost guidance is unchanged across our operated assets off the back of our continued focus on delivering safe and reliable operating performance. This performance enabled us to capture the benefits of positive market conditions for our key commodities. We delivered underlying EBITDA of 1.1 billion US dollars with a group operating margin of 28.2% and growth in underlying earnings to $435 million. Group free cash flow improved to $57 million after growth cap and investment of $338 million at our regional scale Homosa project. Our balance sheet remains strong with net debt of $25 million at the end of the period, enabling us to invest in both high returning growth and deliver returns to shareholders. Looking ahead, commodity price tailwinds, coupled with a planned drawdown of entries at Moselle Aluminium, is expected to add to the group's cash generation in the second half. A strong financial performance is translating to high returns for shareholders, with today's announcement of a fully franked ordinary dividend of US$175 million in respect of H1 FY26 and 100 million US dollar increase in our 2.6 billion US dollar capital management program, with 209 million US dollars remaining to return to shareholders. We're continuing to work to increase our production of copper, zinc and silver into structurally attractive markets. During the half, we advanced construction of our large-scale, long-life Taylor zinc-led silver project and across our broader Hermosa complex, we return further high-grade copper exploration results from the peak deposit, which supports the potential for a continuous copper system connecting to Taylor. As part of the scheduled project execution at Taylor, an assessment of project milestones and capital expenditure will be completed in H2FI26 and will be informed by the pricing of additional underground and surface infrastructure packages scheduled to be awarded during this period. At Cannington, We announced a 28% increase in the underground ore reserve while also targeting further potential growth through both underground and open pit development options. Sarah Gorder progressed options to grow future copper production. We've defined an exploration target at Caterbella Northeast adjacent to the Caterbella pit ranging from 1.1 to 2.9 billion tonnes, highlighting the potential for future mine life extension. In addition, the feasibility study for Cerro Gordo's fourth grinding line is nearing completion, with an independent review of the feasibility study to be completed by the joint venture partners to support a potential joint final investment decision in mid-calendar year 2026. We are also pursuing further growth in copper and zinc for our Ambler Metals joint venture in Alaska. with the US government's decision to issue federal permits for the Ambler Access Road, a key enabler in unlocking the potential of this highly prospective unexplored region. In closing, I'd like to thank our teams around the world for their work to deliver these results. Our operations are performing to plan, capturing the benefits of high commodity prices, our balance sheet remains strong, and our performance is translating to increased returns for our shareholders. Looking ahead, we're focused on continuing our positive momentum into the second half of the year and delivering our growth projects in base metals. Thank you. I'm now happy to take any questions that people have.

Thank you. If you do wish to ask a question, please press Star 1 on your telephone and wait for your name to be announced. If you wish to cancel your request, please press Star 2 and if you're on a speakerphone, please pick up the handset to ask your question. Your first question comes from Paul Young from Goldman Sachs. Please go ahead.

Good morning, Graeme, Sandy and Noel and also Matt. Welcome. G'day and I look forward to meeting you in due course. Graeme, first question is on Sierra Gorda and I guess the last three or four months have sort of all been about copper in the market and I know you're still studying the fourth milling line which has been under study for probably three years now and I know there's been a lot of changes at the JV level in country and in Poland as well with respect to management. So just curious around what do we need to see to actually get this That's the first question. And then just on Caterbella Northeast, you said it's about possible life extension. Really interesting as far as the exploration target is concerned because it could be as big as Caterbella. So what's the forward look now as far as studies and the high-level thinking on this? Thanks.

Yeah, thanks Paul. I might start with Caterbella Northeast first. I mean we drilled about 8.5 kilometres in H1. And in that, we've had intersections of significant copper, moly, et cetera, including 830 mils at about 63% copper or 76% copper equivalent. And as we mentioned, we have came out with the exploration target today of 1.1 billion tonnes at about 0.48% copper to 2.9 billion tonnes at 0.45. The ore body itself remains open in all directions and at depth. So we're doing, if you like, in the calendar year 26, we plan to do further step-out exploration to sort of understand how big your body could be. That will determine then the options you have. Is it an open pit or do you look at maybe accessing from the deep line of the open pit in Caterpillar to access it early? Understanding that resource is going to be probably the most important piece, but I think it's exciting about what that looks like, particularly if you think about the fourth grinding line and extending the life of that operation. And relatively speaking, brownfields, as we know, is always far more capital efficient than greenfields. Look, on the fourth grinding line, there's maybe a couple of things that we'll need to see, and you rightly point out there has been a fair bit of change, more in the joint venture that sort of slowed this a little bit down. In particular, we've changed out the GM a while ago now, about six months ago, and we also changed out the fourth grinding line project director. The GM, I think, has got his... You know, he's got his feet on the ground. He understands the operations well. And we're certainly far happier as a joint venture owner about the new project director and what we think he can bring to the table. You know, the attraction of the fourth growing line is its ability to increase the concentrated capacity by about 20%. Obviously, it has the impact of increasing cropper production and lowering the unit cost rate. So that's very positive to us. Look, the detailed engineering work is about 63% complete. And we expect that to sort of be ready for a joint FIB by the half of 26. We still look at roughly a three-year construction timeline. There's a few things that we've been doing in between around, you know, we've talked historically about the ability to achieve 62% solids in a tailoring signal is a permanent requirement of the team we've been working on. and that's a lot of progress being made in that space. Your question around the other piece we look for, I guess it'll take both partners to approve this, and obviously we can't speak on behalf of our joint venture partner, but certainly in the committee meetings that our people attend, they've been positive, and publicly they've talked about the need for growth in copper. So I think, you know, we'd expect them to be aligned with the project if we see it as value-add. They've certainly been very aligned around some of the work we're doing around Caterbella North East about also looking at what can you do with that material we have sitting on the ground in terms of that oxide material. So, you know, we'll keep working it along. Much happier with the capability we grow on the ground. I'd expect you to see it by the end of this financial year, Paul.

Yeah, thanks, Graeme. Yeah, let's hope it gets approved mid-year. And then a question on Moselle, Graeme. Like, obviously, a lot of discussion on this still in the equity market. Also, probably more so the commodity market's It seems like the ship sailed from your perspective like you've done everything you can and you've made that pretty clear and it now seems like it's really between the government and ESCOM to nut out an agreement around that sort of five-year offtake on the power. So where do you stand now? Do you just sit back and wait for the Mozambican government? I know that seems like a bit of panic setting from their side this week at least. do you just let them sort of negotiate with ESCOM? And if they did come back with a tariff, a discounted tariff, you know, on the current agreement between ESCOM and Mosem, what would you actually need to see from a power price perspective? Because obviously we can't bank $3,000 a tonne forever. You can't hedge more than 18 months. So how do you see, like, what needs to come back to you on the table for you to actually engage?

Yeah, look, and maybe if we take this in parts, Paul, you know, we're obviously very concerned about the 2,000-plus people that work for us on site and about another similar number in contractors, and the knock-on impact is only like 20,000 people in the poodle. It's probably one in three manufacturing jobs and just under 4% of the GDP. And this has been a long, difficult, if you like, group of discussions because the government of Mozambique with the Kura bus having severe drought just hasn't had the power to basically supply us. So it has involved us trying to work with the government of Mozambique as well as the government of South Africa and Eskom. And I think, you know, as at the end of last week, we've probably had 80 interactions and I've seen the government of Mozambique in New York, in Dubai, in Abu Dhabi, in Maputo, in Joburg, London, just about everywhere you can think of. I think, unfortunately, from our perspective, while we only have about 34 point pots offline from the current 576 at the end of January... The reality is we've run out of things in the next week or so of pitch and coat. And even if we found a power contract today, Paul, that could not be delivered to us in time to keep the plant running. So we're definitely heading for care and maintenance in March, and that's just not changing. Look, where we got stuck, if you like, on the power contract, like I mentioned earlier, You know, we just haven't had any power available from HCB via the Kura Busa. So we have been talking to Eskom. You know, the way the current tariff system works in Eskom, their ability to sell across borders is effectively a megaflex rate. Megaflex rate is about $100 a megawatt hour. You know, we could probably afford around $51 a megawatt hour. And if you think anything above $50, even at these pre-these prices that you're seeing at the moment, Outside of China, there's probably less than 1% of the global supply that has a power contract above $51 a megawatt hour. So from our perspective, that was a limit we had. Eston can't match it. It never even got close. We've run out of raw materials. So we're now sort of just running the plant down to the end of its life and managing our people, obviously, which is a huge impact. But it's an incredibly unfortunate circumstance to be in. and one that's not where we want it to be in any shape or form. I do think there's been, despite a lot of work we did, and we've been talking about this power contract for five years, intensively for 12 years, and even though we've been through it numerous times, I think there's still this conception that you can just turn an aluminium smelter on and off, and it is not that easy.

Thanks, Graeme. It's a massive shame. All right, thank you. I'll leave it there.

Thank you. Your next question comes from Rahul Anand from Morgan Stanley. Please go ahead.

Hi, Graeme. Matt, Sandy, and Noel. Thanks for the call. Look, I was going to take the conversation perhaps to Hermosa, Graeme. Just wanted to get a bit of an update. Obviously, you put out some updates around where you're sitting in terms of the shafts progress and also your capex. And you've got that assessment coming up in the second half of FY26. So how are you tracking so far in terms of budgets, both construction and spend? And I think you've highlighted the peak deposit potential. So should we be thinking about the second half as perhaps a bit of a rework of the plan in terms of having those two integrated and then that being a bit accretive, but then you potentially have some critical items in the CAPEX side as well that need to be worked on or rather reworked?

Yeah, look, I would start and we'll come back to where we're up to on the capital. This, if you like, work we're doing around the schedule and the capital is a normal planned event because we'll probably be roughly around 80% of the project committed and that's just the timing of letting out the work. So we've always had that in our timeline to be completed when we got to that threshold. So that's the first signal I'd be giving people that this is an ordinary course of business that we expected to do at this time. If we talk about physically where we are today, we take the processing plant, the initial foundations work for the primary miller were completed in quarter one. All other foundational work on the process plan is tracking the schedule. We started to put in the belt racks, if you like, across the site. I was there just before Christmas. And certainly the surface already, you see a massive difference. There's four packages related to the surface. Two have come in, and they've absolutely been in line with our fit estimate. We're waiting over the next, you know, three months or so that we'll get the other two in. So that gives you a sense of where we're up to with the processing plant. If we talk about the vent shafts, And the shafts, I'll be honest, are going to be always the things that worry me, and we've said that from day one, that, you know, the shafts, you're never really comfortable to your finish, and they have been challenging, and Redpath, you know, has not had the easiest time. The vent shaft at the moment is 459 metres of 824, so 56% complete. We actually completed the first lateral development on the first mining level on the 3680 level and we're about to go back into sinking on the vent shaft and that went absolutely to plan in terms of lateral development. The main shaft which is always scheduled to be behind is about 370 metres of a planned 898 metres or 41% if you like complete. One of the big issues I've always talked about is dewatering. Good to know that our dewatering is certainly tracking ahead of schedule in terms of volume we're seeing is much lower than we expected. We talked about expected flow rates about 4,000 gallons a minute and we've seen at best about 2,000 gallons a minute. That's a lot more comfortable from that perspective. Part of the reason we'll do, if you like, this schedule and cost review is over the next, you know, couple of months, we get the remainder of the surface contracts in. We expect in the second half of this year to get the actual lateral development tended out. And we also expect not long after that to do the final pieces of the underground infrastructure out to the market, which tells you it's the appropriate time to go back and look at schedule and cost. It is an interesting challenge in the US at the moment because every week tariffs seem to change. While we haven't had a material impact yet, as we start bringing in mobile equipment and processing equipment, that's the one we're watching to see what the rules look like. But today there hasn't been material, but the rules change every single day. What I would say on peak, look, peak we announced 14 new holes, and in that we're seeing some really high-grade copper results, including 143 metres of at about 2.1% copper equivalent and 162 metres at 1.42 copper equivalent. We've got a lot of more work to do on this and we expect peak to actually grow. We, again, we do expect that we can add a little circuit to the process plant because we actually allowed space for a copper circuit, which will probably be around capex of $50, $60 million. I would expect that the copper material, depending on how it grows, probably won't be the first piece of ore we touch because the NSR and some of the zinc stopes and silver stopes that are close to the shaft will be very hard to beat. But I do see a world where peak could add potentially another 10 years to Taylor and might be the third zone or second zone that we get into mining. But we'll know more about that probably in the first half of next calendar year. I would say on the Clark side, we actually completed the decline in quarter two of FY26 and the decline to give you a sense of underground activity. work there in terms of lateral development and mining. That was completed ahead of schedule and below budget. And we also did the first bulk sample in December 2025. At the same time, you know, keep in mind about $20 million of that was funded by the DoD. You know, as the mine matures and we look forward, we'll continue to look at some of those synergies between Clark and Taylor. That's not something that we talk about in the current numbers, but we think over time there's some really big synergies in that space, but we'll look at that on a further date. And probably lastly, just for an update, you know, Fast 41 for us in the US has been a fantastic process. The draft EIS was published in quarter four of FY25. We expect the final EIS to come out probably in the second half of this financial year, and we're still on track to get our record of decision in the first half of FY27, but it has been a great, if you like, permitting process that we're seeing. So that's been a real positive for the team. That's probably a lot of an update on Homosa, but happy if you want to dive into anything in more detail.

No, that's exactly what I was after. So thank you for that, mate. Might move on to Cannington perhaps for the second one. Obviously, silver prices have been buoyant, to say the least, and you've had good production this year, but we do have production falling off 26, 27. There has been a mine life extension there as well. I guess I wanted to touch a bit upon whether you see potential there perhaps in the open pit, Again, and how are you kind of thinking about 26 and 27 production where there's any sort of upside potential there? And how do you think about the asset as you kind of, you know, close your innings here? Do you see that as a core asset in South 32 or a non-core one? A bit of colour there would be great. Thanks.

Yeah, look, I would start by saying that, you know, I've probably said this a million times, but I was lucky to be there when we actually built Cannington 28 years ago now. You know, when we inherited Cannington as part of the demerit, we had probably about six or seven years on the mine plan. As one of the slide pack shows in our presentation for this half year results, I think the team has done an amazing job in terms of extending the life of that operation, because even today, If you're looking for a base metals mine and focusing on zinc and silver, Canton would be right up there. And it continues to be a gift that keeps on giving, but we won't shy away from the fact that we recognise that, you know, as the mine gets older and the stoats get smaller, we are going to see variability in results. And you're probably never going to, get back to the same throughput rate you used to be able to produce at, but it's still a highly value accretive mine, even before you've seen this big jump, if you like, in the silver prices. What was pleasing to see this year is that we are basically extending the all reserve life by about 28%. So that's about 3 million tonnes or another two years. So it takes the underground out to FY33. It does require us to invest about 65 to $80 million in further ventilation electrical work in FY27 and 28, we still believe with some of that capital spent, that will potentially open up a little bit more upside of converting, if you like, the resource to reserve, which is about 45 million tonnes. And we'll continue to do that work with the hope of adding another couple of years over probably the next 12 months and maybe a little bit more after that. Now, we have been relatively conservative on our prices of where we've used to run the extension in the underground and look at the open pit. So we use a silver price of way less than half of what it is today. So we do think there is obviously some upside to the underground, but also some upside to the open pit. I think what we've talked about in the past is having the end of the life of the underground And then perhaps, you know, you go into a large open pit model, which is quite capital intensive. With some of the work we're doing now, it's probably more of a focus potentially, if you like, on an open pit that might sort of have a bit of an overlap with the underground, but also a smaller pit but a more economic pit in many ways. So we'll continue to do that study work, and we expect to sort of complete a PFS study by calendar year 26. And we're pushing the teams to see how quickly could we get into execution. Realistically, with the work we'd have to do around, you know, my design integration, you'd probably be looking at an execution in FY30-ish. but would also be talking about a capital number that is not massive because it's a much simpler open pitch. So I think Cankins took a lot of life to live, a lot of value to create for our shareholders. But like every single asset in the portfolio, someone offers us more money than we think it's worth. We're always looking at selling it. But at this stage, we see a lot more value in it.

Excellent. Okay, that's very clear. And I guess when you're trying to work on that new plan in terms of underground and open pit together, you're basically going to be looking at blending of the ore so that you can have a bit more throughput and grade. Is that the right way to think about it?

Yeah, potentially. I mean, I think there would be an overlap. There might not be. What I would say is they're not mutually exclusive. I think there's probably going to be potentially a little overlap in between, not necessarily massive. I think the other thing the team's done a lot of great work on is we do have a lot of low-grade stockpiles historically on the surface at Cannington that we haven't actually processed through the plant because of some impurities contained there. I think the team's done a fair bit of work on what can we do with that to make that accessible to sort of get the throughput up, lower mining costs because it's coming from the stockpile, and maybe managing out the open pit and the underground. There's still a bit more work to do on that, but I think there's a bit more potential in that space as well.

Got it. Okay, perfect. Thank you very much, Graeme. I'll pass it on.

Thank you. Your next question comes from Rob Steen from Macquarie.

Please go ahead. Graeme, before, I guess, I'm assuming this will be your last result. So congratulations, stocks approaching an all-time high. So it must be a good point to sort of be leaving the company. And I'd be interested from Matt if he's got any colour to add around the opportunity, how he sees his role emerging as the company grows. and seeing, you know, what sort of lens he's going to provide onto the leadership of the company going forward. I know it's early days, but some initial insights I think would be appreciated by the market.

Yeah, look, I'll throw it over to Matt in one sec, but I would give Matt a little bit of room there. He had his first week last week with South32, where we obviously had a board meeting in Johannesburg where he got to spend time with all the board. This is his first week sort of round. And certainly the way we're set up is, you know, We're sending out Matt at the moment to have total accountability for the operations to understand that part of the business. He will be going on the roadshow for the next two weeks to meet all our investors. But maybe with that said, I'll hand over to you, Matt, to sort of give your initial thoughts.

Yeah, thanks. Thanks, Graeme, and thanks, Rob, for the question. Listen, really great to be here and looking forward to meeting everyone over the coming weeks and months. Rob, naturally, you know, you've formed some impressions in talking to the board, leadership team, and really everything I'll get my hands on, but I'm pretty cautious to draw conclusions too early. I feel like I'm really well prepared, but definitely keeping an open mind. What stood out to me so far is you've got a really good asset base. There's some real seriousness around how the team applies discipline to its capital allocation, and I'm starting to understand the depth of the operational capability that sits in the business that I think is a real competitive advantage. So I guess the opportunity I see is to build off the really strong base that Graeme and the team has built, continue to improve operational performance, ensuring we allocate capital to maximise returns for shareholders and manage risk really proactively. Over the coming weeks, my focus is quite simple, is to better understand the business. So lots of getting out, listening, spending time on sites, learning, visiting all the assets and clearly also supporting Graeme and Sandy and the team to execute the strategy. So excited to be here and looking forward to meet you all.

Thanks, Matt and Graeme. And maybe just an asset-specific question while I can. With Moselle running to care and maintenance and the Worsley feed being opened up to new offtake, is there any strategic thinking around how that feed is placed into market noting where alumina prices are? Is there an opportunity to draw some commercial arrangements with others, whether it be a JV on the producer side or finding some strategic offtakers on the demand side? Just interesting thoughts. how that allocation gets thought about going forward?

Yeah, look, absolutely. So, look, from our perspective, you know, the Worsley alumina has always been well sought after. As you're aware, we have sold into Moselle at some old LME-linked legacy contracts that haven't always been the most attractive from our perspective. So that alumina that we have previously provided to Moselle has already been spoken for and is already placed in the marketplace. So I wouldn't expect to see more downward pressure on price. If you look at today's price, probably 60% of the cost curve is out of the money if you're an alumina producer. This material will end up, if you like, in the Middle East. It will probably more than end up with a slightly higher margin than what was selling into Moselle.

Thank you. I'll pass it on.

Thank you. Your next question comes from Khan Pekka from RBC. Please go ahead.

Good morning, Graham, Sandy, Matt and Noel. One question on HMOSA. I know you've provided some great detail on CapEx, Ben, and understand 50% of CapEx has already been spent. But what percentage of total CapEx is now committed versus exposed to inflation? And then on the main shaft thinking, how's that tracking to feasibility study assumptions? And I'll circle back for a second.

Thanks. Yeah. Look, thanks for that. And as you expect, we're going to get a lot of questions on her most over the next six months as the project gets in to that, if you like, critical component. Look, the spend I'll talk to you first about. So the spend is probably where we spent US $1 billion. And the actual feed schedule had a spending about this time, about 1.145. So we're about 48% on a spend. If I look at a committed number, it's probably getting close to 58-ish kind of percent around that mark. So there's still a fair bit of work to be done on that side in terms of committing those packages. But as I mentioned earlier, you know, we'll commit the remaining two surface packages and the lateral development in this second half of FY26, and the underground infrastructure won't be far off of that, and that's going to take you probably to 80% of the, if you like, work committed. The ones that I'll focus on there very much are going to be around the lateral development, particularly is that we usually be in a rate kind of contract, whereas lots of the other ones are probably CMAR contracts to the surface where you sort of have a guaranteed maximum price. As I mentioned earlier, tariffs at the moment, we're not expecting a big impact so far, but we'll continue to watch that as the rules change every single day. Look, the main shaft itself, we're about 370 metres of the 898 metres plan, 41%. You know, the speed at which we've been going at the main shaft has certainly been a challenge for us. It's been a challenge in terms of red path performance. What we have seen as we've gone into the So that was the vent shaft I meant to say is at 459 or 56% complete. That's the one that's been a little bit more challenging as we've had some lessons to learn. What I am pleased to see is when we've gone into the main shaft, those lessons have been applied very quickly and we have made up a lot of speed on that side. What we will have a sense of, again, by the time we have all that work committed around that 80% of what the schedule and cost looks like, and then we'll give the market an update from then. I would be honest and say, look, shafts always worry me. You never know what you have to get to the bottom, and they're always a unit rate, so it's always a little bit more challenging.

Sure, thank you. And on Caterbell and North East, a number of questions there just, but on the exploration target, is that supported by indicator-style drilling density? I assume not, but... And then on... the ore, do you know if it's compatible with current Catebella ore? And I suppose where it's leading to, it's more the conceptual development path, you know, is the ultimate bottleneck at Sierra Gorda the fourth line? And I suppose, how are you thinking about that? Thanks.

Yeah, look, I would start by saying, look, it has similar ore characteristics, so there's nothing... that's majorly different and it is virtually a stone's throw away from where we are today. So no issues in terms of processing that through the facility. I think what I would say at the moment is, you know, we're in the early stage of Catabella. We haven't, you know, it's an exciting opportunity for us. And as I mentioned earlier, it's still open in multi-directions. So the primary focus is on really understanding the size of the actual ore body. and the grade of the ore body, but pretty happy to have an exploration target that ranges about 1.1 billion tonnes to 2.9 billion tonnes, and it's still open in all directions and at depth, and it's sitting right next to an existing mine and right next to an existing processing facility. Look, we have a number of drill rigs at site, and we'll split our time between, you know, infield drilling versus exploration. And certainly from our perspective, you know, there's more work that needs to be done to make it a York resource, et cetera. So we're in the early days of this, but I think this is such a great opportunity. We want to share it with the marketplace, but if it absolutely extended the life of Sarah Gorda materially, but a lot of work still to be done.

And just maybe on the ultimate bottleneck at Sarah Gorda, post the fourth line.

Look, I think post the fourth line, the ultimate bottleneck will be still the processing facility. Couldn't tell you which part, but off the top of my head, but my guess is it's going to be very similar where you're putting the fourth growing line in today because that's what we're expanding to remove the current bottleneck.

Thank you.

Thank you. Your next question comes from Lyndon Fagan from JP Morgan. Please go ahead.

Thanks. Good morning, everyone. Graeme, you mentioned the silver price assumption in the Cannington and Mosa reserves. I'm wondering if you can provide some sensitivities around price and perhaps tonnage or mine life. Obviously, if we're double the price that's been used in the reserve calculation, the next update should see some pretty positive changes. Is it possible to quantify some of that?

Probably not. I mean, the one thing I'd have a slight caution on that, Lyndon, that you can model some of this as much as we can. But, you know, the one thing we're seeing in silver at the moment is huge volatility, double-digit changes up and down over a couple of days. So we're slightly cautious to commit a long-term capital investment program just solely on a silver price. It's a speculation. You know, when we looked at the open pit and the underground extension at Cannington at the time, We were probably using a number just south of $40 in terms of silver to give you a sense. So that tells you that there is a lot more upside in that space. I would say the Cannington open pit extension is not hugely capital intensive, but it will be super sensitive to silver price. So certainly one of the challenges we've given the team is to have a think about our commercial team is, Is there a way you could somehow try and capitalise on this silver price today to help fund the future? But it's early days on that and probably difficult to lock anything in because you don't quite know yet how big the pit's going to be. What does your production profile look like? But they are all the options that the team will look at. But certainly, if you think about silver and run across our sensitivity of our group, we have silver, obviously, at Hermosa. We have silver at Cannington and we also have silver at Sarah Gorder as well. So from that perspective, you know, it's certainly an important part of our portfolio. And I think I saw a quick number on a sensitivity that was, if you run at a price, spot price the other week, it's probably about 1.1 billion EBITDA. But that fluctuates every time. That's assuming all the operations are running up at one time. And obviously, you know, Taylor's still got a fair bit to go.

Okay, thanks for that. The other question I had is just on amber metals. So obviously, since you last reported, there's now a pathway to development. I'm wondering if you can step through some of the timeline perhaps that's been put out there or, you know, I'm just wondering when are we going to get some proper information that might be able to crystallise some value in the share price for this opportunity.

Yeah, I mean, I guess the one way to look at this is an interesting one because you clearly have an entity that's traded purely on this project in terms of Trilogy, which is listed in the TSX. You know, they currently have a market cap, sorry, market cap the 10th of February in the US, $800 million. You know, I think the critical piece from our side has been that Ada has received the right-of-way permits to the Ambler Access Road and has allocated $50 million to the engineering and permitting, which means that road work starts to move forward. At the same time, Nana, Doyon and Ada and Ambler have signed an MOU establishing a framework to negotiate access on the road and how the road will work. So that's a lot of momentum we've never seen in that space before. What we will do from a joint venture perspective in calendar year 26 is that we will prove, we've approved about 35 million US to get back in there and do further exploration work and studies. We obviously paused a bit of that when the road was frozen under the Biden administration because it didn't make a lot of sense, but we'll restart that work. We plan, if you like, in the current year to drill about 4,500 metres at Arctic, and that's designed around geotech work and condemnation drilling work, which will then allow us to basically complete the PFS for that some, you know, probably in calendar year late 26. The other one we shouldn't underestimate is, you know, we talk about that road, and that road is about 340 kilometres long. from where we are in the Ambler Joint Venture to the Dalton Highway. But we also have Roosevelt 100% owned, which is about 100 kilometres east of Ambler, so closer to the access road. And we will actually do about 2,500 exploration drilling programs or five holes in this calendar year to understand that as well. So, look, I still think it's, you know, Arctic itself would have been developed anywhere else in the world today. It's a 43-million-tonne resource, 2.9.3% copper, 4.3% zinc, and it's open pit to a depth of about 300 metres, so relatively simple. But you just need that road to be put in place. But I think this is a good first step. I think the agreement we've actually struck with the US Department of War means that their second lot of equity that comes from Trilogy and our holding in Trilogy requires the road to be built before that happens. So I think we've lined up all the incentives and the signposts heading in the right direction, but I still think, Lyndon, it's a longer-term kind of plan. The first critical piece for us now that the road is moving is to really understand the resource and the resource potential in that region because it's largely untapped.

Thanks for that.

Thank you. Your next question comes from Lachlan Shaw from UBS. Please go ahead.

Morning, Graeme and Simon. Congratulations again, Graeme, and good luck in what's ahead. So I've just got a couple to, I guess, clarify. And thanks very much for all of the detail you've given us around Taylor Hermosa, sounds like a lot of moving parts there, quite a lot on target to schedule ahead of budget. But clearly, you know, you've got that review. I suppose my question is, you know, when you think about some of the broader inflationary pressures and some of the outcomes we're seeing, you know, projects for your peers, do you have a sense around, you know, are we talking here sort of relatively modest kind of updates in terms of the capital or Are you sort of thinking that there could be maybe some more sizeable changes to come? And I'll circle back with my second question. Thank you.

Yeah, look, if I gave you an honest answer today, if the team run the trending data and they look at the schedule data, there's nothing that's dramatically different from our FID number. But I'd come back and say when we talked about the CapEx spend, we've spent about 48% of that. So we're not even over the halfway mark in terms of spend rate yet. So I'm also going to be super cautious until we get this piece of work in because, you know, we will go from 48% probably up to about 80% committed to the project. So I think that's why we're doing the schedule review at that time. That's when we'll have a greater sense of the information. And that'll be the remaining packages for the surface we'll know. We'll also know the underground, if you like, lateral development. And obviously the shafts have had a fair bit of work coming out of the next three months. So I think that's when would be a good place to talk about it. Now, what we didn't contemplate at the current numbers or in the FID was obviously tariffs. At this stage, as I mentioned, the rules keep moving. We are getting into the stage of bringing in, if you like, equipment, processing equipment from India and also bringing some mobile equipment in from Europe. And those rules tend to move favourably in the last couple of days. But we'll keep, well, last couple of weeks, we'll keep watching that data. But we'll have a much greater estimate when we do the schedule review. To date, looks on track, but it's only 48% of our capital spent. So I'm never going to be overexcited to have done that work. Again, I would always come back to the point is the single biggest challenge in this project was going to be the dewatering, which is ahead of schedule, looking less than what we expected. But then the next biggest challenge is always going to be the shafts. and the shafts are unit rate contracts. And until you get to the bottom, I'm never going to be comfortable around any kind of shaft work, and we're doing two of them.

Got it. That's helpful. Thank you. And then, look, just from my second question, so, and again, just on the portfolio, maybe for you, Graeme, and maybe even if Matt's got a view, but just on the manganese contracts, Assets, so obviously the projects in South Africa versus Gemco, there's the JV structure there. How do they sort of fit maybe in the portfolio in terms of thinking about where you want this business to be in three to five years' time? Thank you.

Yeah, so good question. I'll probably help Matt out a bit here because obviously Matt's You know, he's had a couple of days in the office in a board meeting, so I'm not going to sort of throw him under the bus. So give him a chance to have a look at the operations and make his own assessment. We'll always start with the position that, look, the way that joint venture works between ourselves and Anglo today is that those two operations are stapled together. You can't sell one without the permission of the other. and you can't actually put one to the market or even your share to the market without the approval of the other joint venture owner. So you're walking lockstep together. But if we take a step back on two fronts, it's one, manganese we think is an attractive commodity, unlike met coal and iron ore when you recycle steel, you have to actually have in manganese again because it gets burnt off in part of the process. Genco and probably Gabon are the two best operations in the world. And if you look at their margins of the businesses, it's an attractive business. So it's hard to sort of dispute that one. I think when it comes to, you know, HMM in South Africa, it is a little bit more challenging because generally the materials are of a lower grade. The rail infrastructure and the transportation to the port basically doubles your mining costs versus what you'd have in Australia. So I think that makes it a bit more of a challenging business all the time, which is why you have a lot of margins. We never typically make a lot of money at HMM, and we probably never lose a lot of money in HMM. Now, in saying that, you look at the margins over time, and this is reflected, you know, we've probably made margins between 55% and 35% in Australian manganese. and the margins in South Africa have ranged from 20% to 5%. So it gives you a sense that the two businesses are quite different. But at the moment, Anglo has been very clear that they've got no interest in doing anything in their share of the operations or the portfolio, so that sort of leaves us in that position as well.

Thank you.

Thank you. Your next question comes from Glen Lawcock from Baron Joey. Please go ahead.

Morning, Graeme. I just want to circle back to Moselle and just some of the comments you made. You said it's definitely heading to care and maintenance. ESCOM's not able to match on power price. So I'm just curious, what if ESCOM does, what's the timeline to restart or is it in your mind this is a permanent closure? Thanks.

So if I sit back and look at a couple of the key consumables, pitch and coats, they probably take five to eight weeks to get them to cycling. We're probably by in the next 10 days, we're going to run dangerously low to having nothing left. And it's highly unlikely to see that change. We just couldn't physically get the shipments now. You know, we did a lot of work trying to extend the timeframe over the Christmas break and But that window is well and truly passed. We're closing the operation down. Look, the restart is never going to be easy. It's going to be expensive. I think the flip side, you can look at what's going on with Alcoa and Alumar. It has not been easy for them to restart that smelter in terms of losing critical skills in the workforce, restarting it in terms of the availability of things like cranes, stability of power, etc., A smelter is like a finely balanced machine. Once it stops, starts, goes out of kilter, it's very difficult to restart in a well-controlled way. And I guess the question is, what power contract would you use to do that? Because clearly what Eskom's got available to sell today is not economically viable. I think you can wait for maybe the Corabusa to sort of recharge back to the levels it needs, but they indicated to us that they could only provide low levels of power for probably the next two, maybe the next four years. That would be a long time for Moselle to be out of action and then try to restart it.

Okay. And what happens to the asset, do you think? You know, you transition to care and maintenance. Does it sit on your books and we spend money, or what do you do next with it?

Yeah, so we're being quite open about that transition to care and maintenance, which numbers have already been included. The ongoing care and maintenance costs are about $5 million a year, so they're not hugely significant from our side. We will have the ability, if you like, to sort of go into care and maintenance. Our closure rehab is probably about $119 million US because it's a relatively controlled small site. We probably need to work through with the government of Mozambique what that looks like because they might want to keep the option around. They might want to wait till 2030 would be our expectation to see what HCV looks like because they don't have anywhere for that power to be used. You know, you're probably using about 940 megawatts at Moselle on a continuous basis. It has a You know, a standby, well, it's virtually running 24-7, 365 days a year. So that's a really large power load to offload to someone else. So they might want to decide when they have power back on or enough power coming out of HCV to try and restart the smelter. It would have to depend on the economic conditions at the time. They're probably not in a position to make that decision until probably about 2030. Between now and then, we'll probably spend about $5 million to protect the site and do the basic care and maintenance stuff.

Okay. So, yeah, it's closing and then it could restart, but, you know, there's a lot of water to flow under the bridge.

A lot of water will be under the bridge and this will be a MAC kind of decision, but it would be... So basing on how our colour's gone at WMR, and you're doing this in Mozambique and losing all that talent, that'd be really tough.

So your first handball of the season. Okay. Yeah. Cannington, lots of discussion already. What do you think we've... She's got left, you know, 28 years ago she was built. You're going out another seven years from today to 2033. But, I mean, like, are we looking at this well beyond 2040, do you think?

Look, I think the potential exists here to get out to 2040 with the open pitch and continued underground extension. So I'll be honest, probably two years ago, I didn't think we could get much more out of the underground, but they've come up with a couple of different areas and we've done a bit of work. It's going to cost us that little bit of capital I mentioned earlier to open that up, but that sort of gives you a little bit more option to add maybe a couple of other years after that. But I think the open pit, a little bit early to sort of say but probably by the end of this calendar year I think we'll have a much greater sense of what that would look like.

Okay and then just finally on Cannington, I know you always say and you have done for years, everything's for sale at the right price but I mean silver where it is, precious metals companies trade at big premiums to the poor old diversified miners. I mean, surely right now this asset's worth a lot more to a precious metals company, a silver company. I mean, do you actively look to try and monetize what could be another 15 years of life today? Like, do you actually go out and do that? I mean, or are you just sitting back and waiting in case someone knocks on your door? Because I would have thought there's a great way to unlock maybe a lot of value and not have to go through the heartache of, you know, all the open card development studies if someone can pay you up front who obviously can afford to pay more.

Look, I think you're continuously looking at those options. And to your point, we're always looking at the portfolio to try and maximise value. For me, there's probably three questions you need to answer is, one, do you understand, do you even have an open pit that's a possibility? And can you extend the underground, which obviously creates a lot more value to anyone who actually acquires it? The second piece is, you know, is there a way that potentially we can access some of that cheaper money to unlock the open pit in terms of upfront capital or long-term sales so you can lock in the current silver price of today? And then the third piece is, you know, outside of the crazy money, there are a number of people who continually knock on the door for us at Cannington. So those three options we're always continuously evaluating.

All right. Thanks very much, Graeme.

Thank you. Your next question comes from Ellen Miller from Blackwater Partners. Please go ahead. Pardon me, Ellen, your line is now live. Thank you. Your next question comes from Paul Young from Goldman Sachs. Please go ahead.

You can't get two cracks, Paul. What's this?

Yeah, I am, Graeme. Thanks. I'm back again. Graeme, a question on Brazil Illumina and just the whole strategy there. Interesting transaction a week and a half ago with Chalco and Rio getting, you know, taking out the Voto Rancho mistake, which is interesting just on the whole Atlantic Basin sort of strategy for Illumina, I think, in general. If I look at the... your Brazil alumina assets, I see you didn't spend much on during the period. The smelter's not running so well. The alumina refinery is running well, but you've got this big capital call on MRN and the extension there on that mine life extension. Can you just update us on that? Because I think the last capex estimate was about a billion US or something, and you've got a 33% stake. It's an equity counting unit, so it's just a washing machine on the cash, right? Obviously, it funds it internally, but you might have to tip in. But can you just update as far as you know, what you're thinking is around the timing on approvals and the capital calls you might receive on MRN?

Yeah, look, absolutely. I mean, I would start with, you know, the performance of Brazil Aluminium has been incredibly disappointing from our side. You know, the team there experienced, well, our co-owner experienced some instability in December 2025 and basically had unplanned 80 pots that had been taken offline. And obviously, that's not where we want to be after the difficult ramp up in this period of time. So it does mean if you think about the 565 plots online, that's a total, if you think about the total plots, 710, it means they're only 80% where they need to actually be. Now, ACOA have deployed a specialist team from their Technical Centre of Excellence. They have guided us on that revised plan. you know, we're taking our own look on that plan because obviously this will be the third time that there's been a review on that. And it's disappointing to see the guidance we gave out today. We've got a, you know, guidance FY26 of 135,000 tonnes, 140 in FY27, yet the full capacity, and these are all our share, is 179. So that's very disappointing from the smelter side. And it goes back to my earlier comment, it is, you know, our current aluminium company with large degrees of expertise in this place, and they've had challenges restarting our EMR. Look, if we sort of moved on to MRM, the work is underway by the operator to finalise all those studies. This will be a key milestone for MRM to sort of understand the schedule and the costs of it up to date. Look, we think it's probably going to be our share of capital, around $200 million, you know, The focus at the moment, if you like, is on the licence we need to operate to go forward to sort of set this up. We get a chance to evaluate that as we get closer, but the project itself for the West Zone is pretty simple. It's a mine expansion. It's a transmission line to get access to cheaper and lower carbon electricity prices, and we'll get a good chance as they finalise that work to make a decision. But I'll be thinking circa... A share of capital for us would be $200 million if we decide it's what we want to invest in.

Okay, thanks, Graeme. When is that decision? When is FID?

The FID on that, give me one second, Paul. It's late calendar year 2027, so calendar year 2027. Okay, all right, still a ways away.

Okay, thanks, Graeme. Yep.

Thank you. That does conclude our time for questions. I'll now hand back to Mistika for closing remarks.

Thank you. Thanks, everyone, for your questions today. I'd like to thank you, again, our teams around the world for the work they did to deliver these strong results. I would say, look, our base business, our operations are performing to plan. They're absolutely catching the benefits of higher commodity prices. Our performance is translating to increased returns for our shareholders. And as you look ahead, we certainly have some positive momentum on the price basis, but also the progress in making some of our growth projects and options in base metals. And look forward to seeing most of you over the next couple of weeks and introducing you to Matt. But thank you, everyone.