Syrah Resources Limited

I would now like to hand the conference over to Shaun Verner, Managing Director and CEO. Please go ahead.

Good morning and thank you for joining us on the call today. With me is our CFO, Steve Wells, and we'll use the presentation released along with the quarterly report to work through today's call. Starting on slide three, the third quarter of 2026 saw the delivery of very strong operating performance during the production campaign at Bulama. with higher production volumes and excellent recoveries. At Vardalia, we commenced the ramp-up of commercial operations for inventory build ahead of targeted first commercial anode material sales in the December quarter, subject to final customer qualification. Earlier this week, we confirmed that our Mozambique subsidiary, TWIC, will shortly receive a US $15 million loan disbursement under the DFC loan. which will provide the Bulama operation with additional working capital funding. This is an important step in continuing to advance the implementation of the strategic funding proposals announced earlier this year. This is also particularly relevant as we seek further market support and policy certainty that would incentivise greater evolution in supply diversification away from China sources of natural graphite and anode material. The long-term strategic importance of Graphite and Syrah's position within the supply chain are positive. Further, policy support catalysts are still critical and an anticipated driver as ex-China buyers move to reduce their reliance on Chinese-dominated supply. However, slower progress on the demand side policy development has contributed to relatively subdued market conditions and price sensitivity, among natural graphite feedstock customers and anode material consumers during the third quarter. Combined with increased activity from Chinese operated graphite suppliers in Africa, this continued to weigh on overall demand for the Lama's Fines products. However, graphite and anode demand is expected to grow significantly in the medium term, and these materials are essential to downstream automotive, energy, Defence and technology industries that generate hundreds of billions of dollars in value globally each year. Customers are still seeking secure and sustainable alternative supply over the medium and longer term and CIRA is core to ensuring these highly valuable industries are less vulnerable to disruption outside China. Meaningful and durable government policy support both on the supply and demand side is crucial to developing ex-China supply chains, incentivising greater critical mineral sorting diversification and growing Syrah's sales volumes specifically. And we're very active in highlighting existing supply concentration and in advocating for policy development. We're seeing such developments in other critical minerals markets where government support is having a clear positive impact on both purchasing diversification and capacity expansion outside China. The cost to governments and customers of not supporting such development would be high, demonstrated by IEA analysis in its 2026 critical minerals outlook, estimating that over US$300 billion per year of downstream production outside China would be at risk if battery grade graphite trade with China were meaningfully disrupted. Our established capacity provides great opportunity as a key partner for customers and governments in building a resilient graphite and active anode materials supply chain. On slide four we turn to an overview of Syrah's performance in the third quarter. Mining and plant operations at Balaama ramped up for a production campaign during the quarter in response to stronger contracted demand. Operating performance was very positive with over 19,000 tonnes of prebark production at 88% recovery. The high plant recovering performance reflects a multi-year operational improvement program which has enhanced flotation and process control, equipment reliability Land Optimisation and Built Workforce Capability. Natural graphite sales in the quarter totalled 18,000 tonnes which included a large volume break-bulk shipment to Indonesia for consumption in the ExChina anode material production and for which payment was only received after quarter end. We also commenced natural graphite sales to POSCO future end under the BALAMA long-term off-take agreement and other partners during this quarter and that's an important aspect of future demand. Our weighted average sales price in the quarter was $583 per tonne CIS and this was down on the prior quarter due to a higher proportion of fines in the sales mix. We expect to continue shipments to ex-China destinations supplying active anode material producers in the December 2026 quarter as well as ongoing container shipments largely to industrial customers outside China. These container shipments are primarily for our coarse flake products where we continue to pursue greater market share and price maximization. At Bydalia, we commenced the ramp up of commercial operations to build anode material inventory. This is being done ahead of the expected commencement of commercial sales in this December 2026 quarter and we anticipate completing final customer qualifications. Bidalia now has a solid foundation for the transition from qualification campaigns to continuous production and ramp-up to commercial operations, subject to the final go-ahead from our major customers. At this stage, we expect Bidalia anode material production to increase to a sustainable break-even cash flow level from the June 2027 quarter. At the macro level, global electric vehicle sales have recovered from a slow start in 2026, but growth rates are uneven with strength in certain ex-China markets, partially offset by weaker year-on-year sales in China and North America. Overall, global EV sales grew 6% in the second quarter year-on-year. Ultimately, this bodes well for improved upstream materials demand in the months ahead, underpinning growing demand for ex-China products. We continue to deal constructively with a highly complex mix of policy, commercial and technical factors across natural graphite feedstock and anode material markets. We remain singularly focused on accelerating sales in these markets. Strong progress in anode material qualification activity this quarter demonstrates both that there is domestic demand in the US for near-term sales and that customers still expect the policy environment to develop towards domestic sourcing requirements facilitating SARA's commercial progress. China's ability to use export licence controls to more broadly impact global graphite and anode markets and the potential for US tariff and investment policy to favour products produced in the US and allied countries. mean that buyer sensitivities should see greater ex-China demand growth in coming years, with timing the somewhat unknown factor. We emphasise the extensive operating and commercial experience that Syrah has built and our asset investment, demonstrating the considerable time and capital required for others to follow into this market, which should create a sustainable lead time advantage for Syrah as policy and market uncertainties are resolved. Moving on to slide five, and before I hand over to Steve to talk about the financials, I wanted to cover safety and sustainability performance across the company. As we continue to develop as a leading ex-China critical minerals producer, we're guided by three core objectives. Being positive for the communities in which we operate, being sustainable for the environment, and providing secure, high-quality supply for our customers. In the third quarter, performance against our key safety and sustainability metrics demonstrated the strong commitment of our teams to operating safely and ensuring that we continue to meet social, environmental and governance expectations. The health, safety and security of our employees and contractors will always remain SARA's highest priority and in Q3, our total recordable injury frequency rate remained at zero incidents per million hours worked for the second quarter in a row. This is a real credit to our site leaders and every employee and contractor remaining focused on safety throughout the operating and maintenance periods, alarmist campaign operations and through Vidalia's operations ramp up. Our safety focus is underpinned by our work on critical risk hazard management and infield leadership interactions which are a daily priority. Congratulations to our teams for this very strong outcome and we're highly motivated to maintain performance and continue to refine our operational risk profile. Pirates operations are also clearly aligned to leading global sustainability and government standards. Our IRMA 50 level of performance for sustainability and commitment to external audits and accreditation processes including ISO standards are critical differentiators. We continue to highlight our commitments to operational, environmental and tailings governance, compared with other sources of product supply, which we're convinced that over time will lead to stronger preference for balama and bidalia products. SARA has invested a decade towards strengthening this differentiated sustainability performance and in reducing the global warming potential of Integrated Anode Production to a level significantly below Chinese benchmarked supply alternatives. This makes Syrah the most sustainable source of integrated natural graphite anode material available at scale today. You can read more about Syrah's sustainability performance and progress in the quarterly sustainability report which will be released on our website today. With that, I'll hand over to Steve to talk about our current financial position and some updates to operating cost guidance.

Steve? Thanks, Shaun, and good morning, everybody. Before we talk to the cash position, I'll note the $581 per tonne operating costs for Bulama for the quarter during the operating periods highlighted on slide four. In the quarterly activities and cash flow report released today, we have updated our guidance on Bulama operating costs during campaign periods and the rest of the industry. We've also had an indirect impact on other costs including transport and logistics, and the rest. Labor costs has also increased, reflecting a broader inflationary environment in Mozambique, while in the short term we are also transitioning to ownership of the equipment required for mining operations at Bulama, which is initially a higher cost of lower overall production volumes, but a better long-term model for the company. From a medium-term perspective, under which we assume we are producing continuously at 20,000 tonnes per month, We have revised the LAMA cost guidance from $430 to $480 per tonne to $480 to $520 per tonne, reflecting similar drivers to the shorter term cost pressures referred to above, but assuming some normalisation of direct fuel costs. At Vidalia, we've increased our cost guidance about 10% to $4.85 to $5.25 per kilo of active anode material. and the rest of the industry. We also have a number of other companies that have been involved in this area. We have a number of other companies that have been involved in this area. We have a number of other companies that have been involved in this area. and a $8 million U.S. Section 45X tax credit, which is also cash received. The credit is an advanced manufacturing production credit under Section 45X of the U.S. Inflation Reduction Act related to the 2025 tax year. Operating net cash outflow in the quarter was in line with the June 2026 quarter, making also an additional $5 million payment for a large volume break box shipment, which was only received in October. At the end of the third quarter, the company had a closing cash balance of US$76 million. Of this closing balance, US$21 million of unrestricted cash and US$55 million of restricted cash under both US government loans. And of that restricted cash, US$10 million is available to fund Balaama operating and capital costs and restricted cash of US$20 million is available to fund Bedalia costs. The amendment of further liquidity for the company under the non-binding strategic proposals received in March 2026 has taken longer than anticipated to implement. However, as announced earlier this week, our Mozambique subsidiary TWIG will receive a US$15 million disbursement from the DFC loan shortly to support working and sustaining capital at the Lima. The market and policy conditions I experienced in Q3 remain challenging. and continue to demonstrate exactly why this multi-element strategic funding proposals were pursued earlier this year. The development of ex-China demand and capacity in a China-dominated market requires funding, customer and policy support and our deep focus on these elements has been critical in navigating conditions to date. And with that I'll hand it back to Shaun.