Sandfire Resources Limited

Thank you for standing by and welcome to the Sandfire Resources December 2022 quarterly results call. 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 one on your telephone keypad. I would now like to hand the conference over to Mr. Ben Crowley, Head of Investor Relations. Please go ahead.

Good morning, good afternoon everyone. Thank you for joining us today for our call to discuss the December 22 quarter. With us today we have Jason Grace, our Acting CEO. Jason will be taking us through the bulk of the presentation today. We also have Matt Fitzgerald here, CFO, and Dave Wilson, our Head of Technical Services. Fair bit to get through today so I'll hand straight over to Jason and we'll get cracking.

Thanks Ben and good morning to all and welcome to the SANFIRE Resources December quarterly results webcast. As we move to strategy and values I draw your attention to the disclaimers. Over the last year SANFIRE's execution of our strategy has delivered an excellent portfolio of high quality operating mines, development and exploration projects. and we have transitioned from being a single operation WA miner to being a genuine international copper producer. Our values of honesty, respect, collaboration, accountability and performance are key to Samphire's culture and they guide our activities across every part of the business. When we consider that Samphire is one of the largest copper focused miners listed on the ASX, that there is an inevitable increase in demand for copper in the future driven by the global energy transition, that we have a dominant presence in four mineral provinces that have excellent organic and inorganic growth opportunities, that Samphire has proven capability as an explorer, developer and operator of copper mines and importantly on the back of the MATSA acquisition and development of the Mateo copper mine to a 5.2 million tonne per annum capacity. Samphire is one of the few copper miners that has a firm production growth pathway over the next three years, growing to around about 110,000 tonnes of copper and over 80,000 tonnes of zinc production per annum. If we look to the December quarter highlights at a company level, consolidated copper production totaled just over 20,000 tonnes with zinc at over 19,700 tonnes for the period. The Mateo copper mine development continues to be on track and construction is now nearing completion. The investment that Samphire is making in resource extension drilling and improving geological knowledge at MATSA is yielding early success with the identification of the San Pedro ore zone at Aguas Tanitas. I will cover this in more detail later, but in summary, it is a new zone of copper-zinc mineralisation that is within 100 metres of existing underground workings and has been defined over initial 400 metre strike length. More importantly, as part of this work, a prospective horizon which is hosting the Aguas Tanitas mineralisation has been newly identified and is interpreted to be around 2 kilometres in extent. Looking now at other key company results for the quarter, sales revenue totaled $217 million with operations EBITDA at $87.7 million, a group EBITDA of $71.3 million and an EBITDA margin of 40%. As mentioned in the last slide, consolidated copper production totaled just over 20,000 tonnes with zinc at just over 19,700 tonnes for the period. C1 costs for the group were lower quarter on quarter at $1.77 per pound of payable copper and cash holdings for the company were just under $264 million with a net debt of $378 million after repayment of the corporate debt facility and $110 million of Matteo debt drawdown. Looking in more detail at group metal production for Q2, Overall performance was in line with the company's expectations, noting that copper was a balance of lower than expected production from Matza, specifically as a result of mine plan changes at Magdalena. This was offset by higher production from Degrassa, and I'll cover this in more detail later in the presentation. Zinc production was on plan due to the benefit of continued reduction in stope dilution, partly offset by changes to the mine plan at Matza, and gold, silver and lead production were generally in line with plan. As a result of this, Samphire is maintaining the previously stated group metal production guidance, noting that due to mine plan changes at Magdalena and the deferral of copper tonnes to the second half, we expect massive production for financial year 2023 to be at the lower end of the 60,000 to 65,000 tonnes guidance range for copper.