Sandfire Resources Limited

Thank you for standing by and welcome to the Sandfire Resources September 2024 quarterly report. 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. Brendan Harris, Chief Executive Officer. Please go ahead.

Hello and good morning. My name is Brendan Harris and I'm the CEO of Samphire. Welcome to our September quarterly call. The first quarter in many ways is like the first session of a test series. While you want to get off to a good start, it's how things end that matters. With that in mind, let's move quickly so we can get to your questions. First, I'd like to acknowledge the traditional custodians of the land on which we stand. the Whachuk people of the Noongar nation as well as the First Nations peoples of the land on which we stand and SAMHPA conducts its broader business. We pay our respects to their elders and leaders to past, present and emerging. I'd also like to welcome my colleagues to the call, Megan Jansen, Jason Grace, Richard Holmes, Kath Bozanich, Gemma Twally and Scott Brown. Starting with safety, we closed the quarter with a total recordable injury frequency of 1.8, a marginal increase from the 1.6 reported at 30 June. Nothing is more important than the health and wellbeing of our people and the communities we are proud to be part of, and we're working hard to enhance our system of risk management and internal control because we have to improve. Turning to our operating performance, in a solid start to the year, We delivered group copper equivalent production of 38,000 tonnes and remain on track to achieve production cost and capital expenditure guidance in FY25. Page 6 of our quarterly report shows this most clearly. As you can see that our run rate across the various metrics is tracking between 21% and 27% of four-year guidance with the exception of exploration which will build momentum across the year. Massa maintained its consistent run of form as an annualised processing rate of 4.6 million tonnes supported a 4% increase in copper equivalent production to 23.7,000 tonnes. Contained copper production itself was a clear highlight as recovery kicked in our poly line, noting by-product production is expected to pick up across the remainder of the year as planned. At Mateo our team continued to put the runs on the board as they achieved an annualised processing rate of 5.3 million tonnes despite completing a five-day shut at the start of the quarter. The copper head grade did however decline to 1% during the period which contributed to the 6% contraction in copper equivalent production to 14.3 thousand tonnes. I can confirm that Mateo has started the December quarter well. and we are gaining confidence in the facility's ability to sustainably exceed its 5.2 million tonne per annum rate of capacity. We were also pleased to receive pivotal regulatory approvals during the quarter for projects that will underpin our ability to deliver consistent and predictable performance in the longer term. At Mateo, approval of the managed aquifer recharge or MAR project further de-risks the development of the A4 open pit and its delivery of first door in the December quarter. Similarly, environmental approval of our new tailings facility at Matta was another important milestone in the permitting process that will enable the complex to remain a significant contributor to the Andalusian regional economy for decades to come. Construction is scheduled to commence in the June quarter of 2025. With the first phase of development to be completed in early FY27 at a capital cost $35 million. More broadly, our Mateo team once again kept costs under control at $40 per tonne of oil process, which compares favourably with our annual guidance for $42 per tonne. Similarly, at MATSA, our team did relatively well to mitigate cost inflation as the Euro, the US dollar and power prices rallied. While this did result in an elevated C1 cost for the quarter of $1.88 per pound, I'd again remind you that by-product production is expected to tick higher across the remainder of the year, while treatment and refining charges are also expected to fall, better reflect current market rates from the commencement of CY25. With growing consistency at all levels of our business, we were able to deliver group sales revenue of $282 million and underlying group EBITDA of $140 million at a very healthy margin of 43%, which was underpinned by an operating EBITDR margin of 44% of MATSA and 58% at Mateo. Together, this led to a further $51 million reduction in net debt to $345 million at 30 September 2024. And if you were in any doubt we intend to remain disciplined as our run rate for capital expenditure builds across the year and we move further, I should say, toward a net cash position. And that brings me to our five-year plan to increase the life of our MATSA and MATEA mining hubs by leveraging the solid foundation of geological and geophysical fieldwork and analysis completed in prior periods. We're now building solid momentum, having turned back to the drill bits and our targeted yet aggressive plans will see us invest $19 million in infill and extension exploration and recognise a $24 million expense for regional exploration in FY25, Atmassa and Mateo. We look forward to sharing the early results of this work when we provide an exploration focused presentation in early December. Bringing this together, we've finished the in good form and the outlook for our products continues to improve but we're not getting carried away as we look to capitalise on our increasingly strong position. With that, I'd like to go to questions. Thank you.

Thank you. If you wish to ask a question, please press Star 1 on your telephone and wait for your name to be announced and if you wish to cancel your request, please press Star 2. On a speakerphone, please pick up the handset to ask your question. Your first question comes from Ben Lyons from Jarden Securities. Please go ahead.