Atalaya Mining Plc

Good afternoon and welcome to the Atalaya Mining PLC investor presentation. Throughout this recorded presentation, investors will be in listen-only mode. Questions are encouraged and can be submitted at any time using the Q&A tab situated on the right-hand corner of your screen. Simply type in your questions and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company will review all questions submitted today and publish responses where it is appropriate to do so. Before we begin, I would like to submit the following poll. And I would now like to hand you over to CEO Alberto Lavandera. Good afternoon to you.

Hello. Thank you very much, Alex. Welcome, everybody. Thank you for attending this presentation. We'll try, as usual, to be brief and leave some time to questions. We're here to look at the results, quarterly results, financial results, as well as looking at the advance of the company during these three months and our plans for the near term future. With me, I will have Cesar Sanchez, the CFO of the company, which will reply to some of the questions related to the listing and to some other legal things. The summary of our results is included in slide six, and without trying to read all the numbers, which you're happy to go through, we had already pre-released the production results, production of 12,500 tons of copper during the quarter, getting the total today to close to 39,000 tons with cash costs of 282, accumulated to 76 and all in costs accumulated around 307 for the year, which are taking us to the outlook for the year of around 53 to 54,000 tons of copper. Now we're in mid November, to some heavy rains experience during the quarter, the current quarter, we will likely be in the lower range of that 53 to 54 anyway, very close to what we had already, And the cash costs, it looks like we are going to be also within the range that we had set, the all-in costs. With all that, we had quite good, I would say, results, probably better than the consensus, with a bit of 19 million, which is equivalent to 60 million euros year-to-date. There was one reason for this increase. say better results is the electricity prices were lower than previous years still high still high and besides that we continue having a very good balance sheet with net cash position for around 67 million euros and this is after continuing to invest in the solar plant and continuing to invest in the helix plant including dividend payments, and also including, of course, the ongoing capital. So even with this kind of lowish cover price, the company continued to generate cash during the quarter. We have made some changes within the board. Not the board has not changed, but some of the roles of each of the directors have been changed a little bit. And the most important thing from the corporate point of view is that we have announced that we are going to apply to move from AIM to the main market. That has already been done. And we are in the process of doing that. And I think we are just spending some technicalities and finalizing some documents, but we are following our plan to do this before the year end. And in addition to that, which, although they're not necessarily, they are linked, but not necessarily also the proposal to move, remove the missile, the company from Cyprus to Spain. There are several reasons for that. And this part of them are as a result of the of the Brexit and the fact that the UK is no longer in the EU. From the assets point of view, from the investments point of view, we continue to progress. We continue to progress the construction of Helix. Things are moving quite fast and the solar plants also moving quite fast. And especially the important thing is that we got already some authorizations for the extensions of the mine life in Rio Tinto, which include the expanded tailings for 150 million tons. So this is a huge achievement. Also got the AU... for Basavalverde to be able to extract ore from there and treat it in our plant. And the most important point here is that we are advancing with a stakeholder and permitting in total. As you can see, total is the most important thing. It doesn't seem to be progress, but there is progress. There is progress with paperwork being done and especially from the Junta making some new laws in order to expedite and to permit projects and specifically mining projects. This new law is going to be coming into place in the beginning of the year. So going directly, health and safety, you can read things which I think we had already mentioned in the past, publication of our sustainability report and certain data that we continue to operate safely in this company. Going directly into the data that was mentioned, just a few remarks. The plant continued to perform well. within the line, well over the 15 million tons design capacity. Recovery also going well, better than planned. And the production was slightly lower and this is a result of maybe basically lower grade. Lower grade is a result of the way that we are going through the pit and we believe this thing is going to be improving in the near months because we are going through an area of lower lower lower grade at the bit as a result of that production sales as i said before slightly higher due to a little bit better copper prices than the previous quarter and the most important thing is also a bit going better than the previous quarter and as a result of that the cash flow and the net cash position continues to be good similar to the previous quarters in spite of having given a having distributed a dividend and also having continued to invest in in several projects and growth projects at the at the outside we ended the the the quarter with 120 million euros in cash, which is a good position to have, and with borrowings of 52 having paid some of the lines of credit. And we continue to have a good working capital surplus of around 77 million, which is basically around 85 million US dollars. Part of this is the improvement of the market in the electricity market. But as you can see actually Q3 due to the summer months, very similar to what happened in, in the previous year has been higher than the previous quarter, but of course, much lower, less than half what happened in the year 22. You can see it very well in the graph. In year 22, our cost of electricity was 300 euros megawatt hour, and this year was 120. In addition to that, we had, as you know, power purchase agreement for around 30% of our needs and so the average result has been lower than that. The good news is also as expected that the electricity prices have been so far in October and November has been lower than the previous quarters. Also, it happens in previous years and it should continue to happen in in January due to the strong winds and very strong winds, very strong storms and rains in Spain, which reduced the need of gas, although the gas prices are slightly higher. So I think that this is all going well in the good direction. From the cost point of view, very, I would say, flattish quarter in general, in mining and in process. But you can see that the cost of a quarter have been slightly higher in mining and processing. This is basically due to the still the inflation that we can still see in explosives, diesel and gas. Gas is affecting lime. but also is the effect of lower production due to the lower grade. And then most of the costs are cost per ton. And the effect of that is that we have slightly higher costs in a cost per pound basis. But we, overall, there are 6 cents difference in cash costs versus the year to date. and well below what happened in the previous years. You can see that we have had a capitalized stripping, high capitalized stripping. This is due to the start of the waste movement in San Dionisio and also at Cerro Colorado, our current pit, in anticipation of the starting to move in the new pit called San Dionisio. because the contractor is only getting the new trucks and escalator by June. So they had to advance a little bit more with their equipment during this quarter and they will continue to be doing that in the next quarter before we get ready with the supply of the equipment. But of course, overall, this does not change at all the strip rate of Cerro Corrales, which is a little bit less than 2 to 1. Comparing with our peers, we always show this picture. We continue to try to control our costs. I think we are in good shape compared with other peers similar to us. And the first thing you will notice is that the tendency of increase of costs that you experience in 2022 has been stopped, while in other companies this has continued due to several factors. So with this, we continue to generate cash. um there's only one and one half months to go so as i said before the guidance uh there's no reason to make changes in the guidance and we will we will be likely in the lower range of the guidance for production of 53 000 so very close to 53 52 8 53 2 something like that plus minus so not not in the 54 still recoveries will be better than expected originally and the cash costs will be in the range. Everything from the capital point of view is also within the range. So now looking at what we have been doing simply from corporate point of view we have we have announced that we are moving to the main market. This thing is moving very fast and the addition documents and all the papers are almost ready. And the prospectus is going to be published soon. Certainly we will be ready for the end of the year. The prospectus will be published without needing to raise any fund. There are several conditions, but we have been in constant contact with the stock exchange and we are fulfilling all the issues, all the paperwork needed. So we think the time to be accepted for the listing will be in December, end of December 23. very likely, instead of being listed in name, in 24 will be listed in the main market. As you know, this has lots of implications. And one of them is that this opens the possibility of being included in index. And we have seen that there are a few questions about this in the Q&A, so we'll go through them. For that, we'll have an AGM, an AGM, especially AGM in our offices in London, the small offices in London. And you're welcome to assist for those of you that are available. The main question will be to consider the potential demisillation because this this remedialization is a requisite to be able to be included in the index. If we continue to have our domicile in Cyprus, then we wouldn't be entitled to be participating in the index due to several reasons. You have to find some other country. This paperwork is linked but not related to or not totally conditional to the listing and it will be finished, expected to be finished, the remitulation by sometime the end of May due to the paperwork it has. If it's approved by the shareholders, of course. With that, we will be one of the few pure copper place in London, small, but hopefully we will be able to grow and we include it in the index. It's important to be included there in the index because we show this picture here. We are still of the belief that the deficit of copper is there. It's increasing and There are numbers of copper deficit in the world between four and six million tons of copper by the end of the decade of 2030. And all the indications are that this is going to be there and simply there's not enough copper coming on stream. An important producer, Codelco, the largest producer until recently of the world, is going down and they need to do a lot of investments just to maintain their status quo. And actually, they have already guided for the production of this year to be lower than previous year, actually the lower in five years. And next year, they only show a very modest increase, which is basically flat, assuming everything goes all right. The reason why there's still some potential oversupply in the market this year has been twofold. One is the reason is that coming on stream of Quebrada Blanca with a huge delay in a huge investment and overinvestment. Tech, Quella Beco, Buy Anglo American in Peru after long delays and Cobre Panama. These are the main reasons why there is a kind of oversupply this year. What happens with these three is first of all, the big one, the first one, Quebrada Blanca, Huge over expenditure and delays means that the tech has already said that they will not consider any further expansion in the next 12 months at least. Callabeco, it's ramping up, but so far I have not seen any brownfield expansion. And Cobra Panama, you probably are probably aware of the problems they are having. And there are even rumors that this thing, this mine could shut down due to being the award of the concession being constitutional. We don't want anything bad happening to our colleagues of FreshQuantum, which are excellent operators. But the reality that shows you how difficult it is to be getting new mines into production and also how risky it is in certain countries and how country risk is so important. That's why we are so happy to be in Spain and specifically in Europe. Obviously, if this mine stops for some reason, then the copper price can go to any point. But even in places that are very well known like Chile, the largest mine of the world is Escondida, as you know. Escondida is producing around 1 million tons of copper. And this graph shown in the presentation, it has been shown by them. In four years time, their production drops by half a million tons. Half a million tons is larger than any of these mines that I showed before, Quellabenco, Cobre Panama, or Quebrada Blanca too. It means a huge new mind disappears just because of the grades going down. Does it mean this will happen? No. I'm sure BHP will invest whatever is needed to maintain the production. But that shows you that even the largest mine of the world in four years time needs a huge investment not to grow, simply to stay in business. Simply because the grades are going down as most of the mines do. We are very bullish in the copper market and this is why we wanted to bring these slides. Let me finish with how things are going. On site, in first place, you see this in red, the helix plant. The helix plant is advancing quite fast, shows the size compared to the rest of our installations. And in the background, you will see a flat surface. That's the position where our solar plant is located. we went inside the the lx plan there's not much pictures there because the the the company that has the technology doesn't want us to to publish pictures to guide people to because this is something new but i can show you that the process is huge the it's it's going very fast and uh and planning to start commissioning at the end of this month of December, and even having some initial production, even if it's only trial stages in the end of the year or the beginning of 2024. So we have some delays, but things are finally going full steam. Same thing we can say with this solar. The solar, this picture is probably a bit old. the construction and implementing of panels and support is advancing very, very fast. And we already have a schedule with the electrical company to disconnect our substation for a few days from the 132 lines to connect this substation to our substation and to the grid. And this will be likely the first week of of January, meaning that anytime from then on, we can start producing from these electric panels. And this will be huge, huge cost saving for next year, starting basically already in January, 2024. And we continue to have a good support in total. Things are going slowly, but advancing very well. And here I can report that the Junta de Andalucía, the local government, Junta de Galicia, is passing a law. It's going to be working in January in order to expedite and improve the approach the timeline for approval of projects. They have created four categories of projects, industry, another one is specifically called energy and mines, where we will be specifically included. Another one is agribusiness and another one is forestry. Those projects qualified and we are there. This law is, when this law is passed, as I say, starting in January, it's being discussed now with full majority. The projects will have a maximum of one year of timeline for permitting, warranted by the local government, even with compensations for the costs that this creates if the project is not approved. This is directed to specifically some large projects like ours that have some controversial disputes by environmentalists, as well as wind farms, both onshore and offshore. We are including that one of energy and mines. So I think it's quite good, showing very good support from the local government. which is working, reviewing all the documents, and we are seeing finally the time for the permitting of TOTO. In parallel to that, the company continued, our teams continued to work in optimization of that project, looking at that equipment, preparing engineering, so that whatever time we lose right now, we will be able to compensate it later with bringing this into production, starting sometime in 2024. and have it constructed by 2025. And we believe that this is possible. Time where we believe that the copper deficit will be at its highest. So I think that's probably taking a little bit more than I expected. And so this, I'm going to go into questions. Please feel free to add to the questions, but we have some that have been submitted. Some of them related to the listing are going to be replied by by Cesar and the first one actually is for Cesar which says how is the process of listing onto LSE going and the updates although most of it has already been said in the presentation and by me but Cesar do you want to add anything?

yeah sure thank you um albert and hello everyone so we we've been working uh for a number of months now uh to basically get um communications with the fca which we already have a few draft of the perspective submitted and and so i would say that nowadays uh the public information we have identified no deal breakers for being listed in the main board of the London Stock Exchange. And as Alberto mentioned, we're expecting to have that trading in the London Stock Exchange before the end of December. So it will be sort of mid-December. So I guess the short answer to that is I think we're going pretty well aligned with our expectation, just to be traded in the longer-term before the year-end.

The second one is, how do you see the price of copper moving in the near term? Could China decline in the real estate market and increase copper usage be an issue for our firm? If so, how will we manage this issue? This is correct in the sense of there is a kind of decrease in the real estate market. But I have to say two things. One is there is a kind of contradiction in the real estate decrease when you see that the iron consumption and the steel market is booming with iron ore prices getting to record highs, which are specifically due to the huge demand of iron for construction, which is normally the predecessor of the copper because obviously you have construction is followed by copper. Having said that also, the real estate market decrease has been more than compensated and actually China has been growing month by month the copper usage due to the huge demand on green energies, specifically wind and solar. but also as well the grids related to the electric vehicle, where China is the biggest producer in the world. And this is more than compensating the decrease in real estate. If now it looks like China's government are implementing measures to give credits and to re-bump again the real estate market, this is going to be a huge bonus in addition to what's going on. So we don't see a real decrease in copper usage right now. In addition to that, there's a second thing that we saw yesterday or two days ago with the meeting of the two presidents of China and the US, where they have agreed in certain measures to implement green energies, wind and solar, which I don't remember the number of gigawatts, but it was huge, meaning that the extra consumption from what I've seen in the research from Citi, extra consumption, if they did these goals up to 2030 with these two countries, would be extra two and a half million tons of copper per year, which is basically 10% more. It's so much that's almost incredible. Just this commitment between these two countries. There's certain logic to do this. The logic is that China is the largest fabricator of solar and wind turbines. So not only they're installing themselves, but they want to install it outside the world. And in the US, I think they have a huge potential of cheap and fast energy. And I think it's quite a good news to see these two big companies large economies of the world getting a common goal, which is the green energy, which will more than compensate the real estate. Do we have a plan B if the price of copper goes down? Well, we don't think it's going to go down. But if we have a plan B, we'll have to adapt like we did in the past, cutting. We have been through periods of very low prices of copper, and we managed simply cutting costs in things that are not essential, like exploration or some investments that can be delayed slightly, like one or two years, not without having a big issue with the long-term value of the company. Our next question is, it relates to, from the original articles of the Association of AIM Listing, it says that there was an extensive database inherited by the old Cyprus company, basically Oksiana, and they had interest in the Mesothoic belt, 3,000 kilometers of the Thetian belt. and there was a strategy to look at the jurisdictions, so on, so on. Well, this comes from the times of EMET. The question is, is there anything left from the legacy goals of activity of EMET? Are we still working from this database information and prior knowledge? Well, I have to say that we... that this database was not very useful. The investments that had been done in places like in Georgia and in Slovenia were not really very good. And even in Cyprus. We long time ago, we finished with the commitments that were done there. It was basically spending money without really any potential. And we have been focusing in growth, yes, but we have been evaluating things in South America, some in Central America, Spain, Portugal, North of Europe, and Eastern Europe. And that we continue to be very active and all the time, but really we're not using too much the database that's available from IMEDD days. has some assets in bulgaria slovakia and anesthetic focus on greece do we retain in the assets now i've just mentioned that we don't have anything there since long time ago is which ventures fully owned by atalaya no i don't think so it has a three percent in kefi down for 3.8 either way What's the Atalaya stake in Kefi? Are you holding or selling? Given Kefi management previous experience and understanding of EMET, is there not any opportunity to partner with Kefi Gold Project in Ethiopia and Copper in Arabia? Have any talks taken place? If not, could it be worth to expropriate their phone call? We'll take that advice and maybe give a call. I have to say, honestly, my own opinion. I tried to sell the shares of Kefi when still the people that were there in Kefi were here. This is nine years ago. Nine years ago, they promised they was about to start in production in Ethiopia. and the shares have gone asymptotic to down. I don't even know what we have right now. Maybe Cesar has the detail.

We really have around 4 million shares of CAFI, which is worth around just above 20,000 pounds.

At that time, it was worth several million. So CAFI is a good example of how money of the shareholders is not wisely invested. I don't think we... we see any value in getting into these things, which by the way, I don't know if they have any value or not. I simply see the results are not quite good. Moving from Cyprus, next question is moving from Cyprus to Spain and ending in Canadian listing. I fully understand the motivation to move from Cyprus and the cost of running Canada listing versus actual volume. However, I believe there were certain anti-hostile takeover advantages when enjoyed from our current previous setup. Am I correct in this assumption? What will change? I think probably yes. Maybe Cesar can reply, but the reality is that there were certain limitations of ownership being in Cyprus, but at the end, we only have one big shareholder, which has 22%. And I don't see how anyone can make a takeover bid without agreeing with this larger holder or with other two that we have, Covas with 13% and a few others that have five or six. So we are quite relaxed from a hostile takeover point of view, to be honest. But I don't know if there's any big change, Fesher, with this.

Yeah, more than a change. I can give a clear guidance about what should be expected. So we were speaking about the re-domiciliation to Spain. But if you take one step backwards, we tested the market for a number of months to be listed in the main market. And one of the benefits of being listed in the main market is you can be eligible to be included in one of the FTSE index. In order to be eligible to be one of those, you need to apply the UK corporate governance code, you need to apply the UK city code, and you need to basically be domiciled in one country, which unfortunately Cyprus is not qualified for. So, and that's the main driver about leaving Cyprus, which would be, you know, for a number of year, and we think that no longer represent or interest in the world. And that's why we decided, or we decided to propose to the shareholders to approve to domiciliate the company in Spain. Now, once we domiciliate in Spain, we would also approve, you know, the adoption of the UK corporate commerce code and the UK city code. So in terms of M&A, I'm now addressing the specific question, in terms of the M&A, you have enough provisions in the UK company law to basically apply the UK city code. And all the provisions including the UK city code will apply to Atalaya once we're listed and once we are in Spain. And that answered the question. So, yes, we had some old provisions coming from Cyprus, but they're not significant what we would be applying now as part of being a Spanish company listed in the main market.

The next question is also related to the listing and to the domiciliation. Domiciliation in Spain. Did you look at other authorities? At one point, I think you were considering the UK. Is this correct? Yes, it was correct. Apart from the logic of your main asset being Spanish, are there any advantages of being domiciled in Spain? Do you consider other jurisdictions like Netherlands, which I believe has better anti-style takeovers? Yes, we look at other jurisdictions and the main reason why not moving into UK was it would trigger a huge tax issue since it went out from Brexit. Due to not being in Europe, it would basically, if you, the interchange of shares, and we even had a company called Atalaya Metals created in the UK, it would be seen as selling shares of a European country like Cyprus and buying shares one by one in the UK. This created a potential tax liability or loss, but anyway, like you have to pay taxes at that moment without having to actually having buying or selling any shares, basically simply the exchange. So that really avoided the plan of UK, which was our original plan and best plan. Then we looked at other advantages. The problem here is that you really have to, other places like Netherlands or other countries in Europe, you have to have a real presence in this country. So first of all, so in order, in order to be able to have offices, to have something there. So really it made it very difficult in the case of Netherland, although we had to be moving there and have a presence there. But Probably, I believe it has certain anti-hostile takeover measures, yes, and other advantages, but we decided that it was better to do it in Spain. And this is what we are going to pass to our shareholders to vote. Of course, if the shareholders do not approve it, well, we will look at other options because we believe that the ultimate goal goal, which is going away from Cyprus, is to be able to be included in the listing, sorry, in the listing on it, in the index of the wood seal.

And sorry, Alberto, if I may add, I don't know if it's better or worse, but at the end of the day, we will have the anti-hostile takeover measures as any other UK company will have by applying the UK city code. I think this is the mind, so we're not going to be in a different situation as any other UK entity.

Would you agree, next question, would you agree that there are advantages how to make and find an acquisition? Atalaya gearing is very low and could make the company attracted to private equity, vulture funds, or another copper player who would use Atalaya balance sheet to parcel the finance at the cover? I think, yes. You're correct. I mean, somebody asked me, and I was recently in the UK doing some marketing out of London, that one of my worries was that our share price was low. And I said, look, this is the thing that really worried me because eventually we know that the market situation is tough and somebody could come with a very attractive offer. And, you know, some funds will say, look, you know what? I'm tired and I will take this and whatever. It's not so easy because of our concentration of shareholders, but of course, it can always happen. But I don't think this makes a difference of being in one place or the other. We don't believe that's a problem. I also don't think that anyone would make an aggressive acquisition without having certain knowledge of the permitting, without being friendly with existing employers or shareholders. it will be very risky. I can tell you, and I'm happy to keep this recorded, that I would not accept to be bought by someone to simply keep it in private equity without trying to get the higher value for our shareholders, including me. So from that side, it's not the first time I've been subject to this. I'm very well known to, let's say, provide, to work for my shareholders. Another one is, I heard from some non-accredited sources that there were some setback issues with ELEX. Is everything on track? Well, I don't know what the word is. I mean, things have taken longer than we expected due to the fact that ELEX is something new. And Laín is developing this by themselves, which means they don't give this to a big engineering firm to do the whole thing. And this really has delayed things, especially, for example, in summer, they could not get enough people to work in the final assembly. So in July, August and September, simply they did not have enough people to put pipes, cables and so on. Right now, there are over 100 persons working inside that building. I was visiting that two days ago, and I was very impressed. But the proof will be coming soon, before the end of the year or first weeks of January, we will announce the first production from that site, even if we are still in the commissioning stage. So I think this is a huge success. The next question is, Background to question. According to McKinsey, a consulting firm, the electrification trend is expected to increase annual copper demand 36 million tons by 31, with supply forecast to be around 30 from the current 22, creating a 6.5 million deficit in the start of the next decade. Is this considering that Raya is starting to explode Rio Tinto? Obviously, what we produce today is potentially a considerable discount to the expected demand. This is a good point because somebody can ask, well, why don't we keep the grades there and use it later? Well, the thing is the setback would be, okay, we will stop production. And so our share price will go down immediately and wait until the prices come. But it could happen as history has shown us that there is a war and this price do not come for any reason or suddenly all the electric cars start exploding and suddenly the electrification is not there. So then this would be a very risky business to bet in what's going to happen in the future. Having said that, this deficit is totally, I also believe so. It's going to start anytime, anytime. I mean, if the deficit is there, probably we'll start seeing prices that are elevated in 2024, 2025. Very elevated. What I mean by elevated is prices could go to 15,000 tons. It would double. not at 20 they could double easily in order to first incentivize production new production and second reduce demand from from sources so try to take substitution or simply make it so expensive that it will not happen so then the deficit has to be compensated some way so look what are we thinking? Well, I think it is being considered part of the strategy right now, yes. We know that the pitch can be deeper and we can extend our mind life beyond 15 years. We know that the higher corporate price will make deposits that otherwise would be lower grade like Massa Valverde or like the deeper parts of San Benicio or the deeper parts of Terra Colorado would not be economic. So we have a plan that if this price is materialized, our reserves will be larger and we will be producing more. And of course, if this materializes, as we expect, the share price of Atalaya will also go in a similar boom like copper price. But right now, what we are looking is looking at things to position ourselves in good metals, because at the end, the shares in a mining company are like options in the underlying commodity. And the longer life you have is the better value of the option. Another question, we have lots of questions today, is with your potential move to the main board, Have your banking advisors identified what indexes you're likely to join? I believe the normal index. So far, we don't have the size to join a larger index.

To add a little bit more colour on that, so yes, we have discussions with all bankers and first you need to be eligible, as I mentioned, and one of the conditions is basically to be in Spain. And the second one, you need to be the size. So as we don't qualify to have the size for FTSE 250, we will be included in the small business FTSE. And then once we get the size, which we could really have around 500 million markup, Once you get around 700, which I think we will at some point, we will qualify for the FTSE 250.

With our potential move to the main board in the UK, have any institutional investors indicated that this will enable them to add or initiate investments in Atalaya? Yes, actually, we have had investors in the UK saying that they were not allowed in their institutes to invest in AIM companies and they would be welcome if we were in the main market. Likewise, there are other companies and institutions out of the UK that have the same reason. They could not invest if we were only AIM listed. So yes, I think this would attract new investments without any question. The next question is, are UK corporates investors, CIPP investors, ISA investors to be subject to the 10% withholding tax or any future dividend distributions by Atalaya. If rhythm is silent to Spain, such withholding tax shall be irrecoverable, not be recovered by said UK corporate investors, ISA investors and SIPP investors. Has Atalaya considered this tax implication when rhythm is silent in Spain? Could you please go ahead, Feser, with all the details?

Yeah, so starting from the end of the question, yes, we have considered the tax implications. And overall, we think that it will be neutral for the majority of the shareholders, but regime will be slightly different. By definition, any non-resident shareholder needs to be withholding tax at 19%, only if you have a couple of conditions to basically be qualified not to be withhold. One of these conditions would be if you're domiciliated in any other country of the European Union. And the second one, if you have above 5% of the company for a period longer than one year. Now, if you don't qualify to those conditions, you may be subject to withhold of 19%, which according to the double treated agreements between Spain and the UK, you will be able to basically deduct when you do your tax return in the UK. So effectively, we have no way to impact your tax schemes, but we likely will need to We hold 18% for non precedence or let you have those qualifications and that 90% you will be able to pray to provide you with that certificate which you will be able to deduct from the tax returns to do your meditation. Now, I'm not 100% familiar with the ASA investors or the safe investor. I mean, I don't know how exactly that works in the UK. At the end of the day, if you need to tax that and you are being withhold for 19%, then you will be able to deduct that 19% on the tax return you do when you're doing your investment through those tools.

My next question is very similar to this one. Please advise the impact on taxation and dividends on the proposed redimension in Spain. In particular, my reading is that Spain will withhold taxes of 19 or 24% of dividends and for holders of stock in SIP and ISA, majority of individual holders expect that none of these taxes recover, clearly a major concern. Well, I think Cesar has explained the possibility offsetting those, but we don't know exactly the details of that. Do we have an off-taker for our Elix product as yet, or we'll have it just sell to the market? Well, we don't have an official off-taker, but we have received indications and people have visited that both the sink and cover products will be modded at full value. for companies that are buying these materials from other places. The quality of the zinc and copper products are so far basically 100% assay or 99.99, so it should be enough to basically get 100% from the market. Next question is how much will admission to the main market increase unit costs? Well, we have a very low We have a very low overheads and I don't think this will be a big issue. So far, we don't see a big cost in anything major or any significant relevance, except the more additional paperwork, but nothing special that we can see.

And the cost for the emission to the main market will not be qualified as a unique cost, right? It's as a one-off. And as I say, as we're not raising funds, we're trying to minimize the cost to do all the work.

Can you explain how revenue and EBITDA are sequentially higher in Q3 compared to Q2 when sale volumes and realized copper prices were both lower than in Q2 and cash costs were higher than Q2? Can you reply for this, Teso?

Yeah, sure. And this is quite technical. Yes, indeed. We have, we book it for 85 million in Q3 and compared to 79 million in Q2 in terms of revenue. But the main reason, and the realized price excluding QP, it's slightly lower in Q3, but the main reason is for the open QP. So, and this is not gas adjustment, but when you have some open QP that you need to put mark to market in your P&L every time you do a hard closing, That adjustment was minus 6 million in the previous quarter and was almost zero in Q3. So addressing your question is, is the way that you evaluate the market to market the open QP? And there is no other reason. And that's why it works in a different way. And it's just the way that the market price, the copper price has been moved in the last two quarters.

The next question is, how do you expect the production and cost front for 24? Well, we have not given guidance yet, but I expect to be very similar to the previous year, to this 23. Next question is, today was reported significant cost reduction in TCs and RCs for 24. Are you expecting to benefit from this reduction in these charges? Yes, we are expecting to benefit from that because we are linked with the benchmarks. Having said that, in addition to that, we expect the next year to be able to sell a significant portion of our production to the local smelter since this local smelter owned by Freeport is getting supplies from Indonesia and Indonesia is finally getting into production a new smelter which means concentrates that were coming from Indonesia are not going to come to this smelter and our trucks pass in front of the smelter so very likely we have been in discussion then that we will take a significant amount of production which means not only we will benefit from the TCSRC that were benchmark for 24, but also will benefit for a profit sharing of the savings of shipment costs to China, which are at least the same amount of the TCs in a normal year. So we expect the next year in this side of selling cost will be better. Next question. In the case of TOTO, what will be the next key milestones considering there is support for mining project from the Junta? I think the key milestones will be the inclusion, official inclusion of our project as a strategic project, which very likely will happen in the beginning of the year. And from that, they have a specific team. They will have a specific team speed acting the project. The papers were done by the Junta. And the next milestone will be the completion of the public information period, which we expect sometime in the first part of the year 24. From there, it should be quite straightforward. But with permits, you never know. But I think the key milestone will be the inclusion of our project as a strategic project. which we have been told verbally that it fulfills all the conditions and that we are going to be basically the first larger project to be included in this type of new law that's going to start on the 1st of January. Is there any risk to the mine plan if your permits of San Dionisio are delayed? What is the critical path of that deposit? San Dionisio is composed by two zones. The upper part is open pit and the lower part is underground. Both will be mined simultaneously to Cerro Colorado. So whatever is not mined now will be mined later. So the only thing is, as you know, San Dionisio contains higher grade and the sooner we get that higher grade, the better is from the net present value of the project. With permits, we never know because it's subject to the authorities. We already have a permit for pre-stripping and for doing some initial work, which right now we are doing already, but they still need a much larger permit for the full footprint. What is the risk? The risk is delayed. We don't expect it not to be approved. Actually, it would be crazy that they give us the approval for an initial project and not give us the full project. And also it will be crazy not to, having given us the space for the tailings, 150 million tons, not to have the space, not to have the ore to mine it. So it will happen, but simply this bureaucracy and the critical path I would say is the... is the periods of papers, stability, several things that are needed, which we'll expect it to happen sometime in the year. So far, we will continue with this smaller pit that we are doing right now. And I would say mid-year, we'll be ready to go full steam. But as I say, it doesn't affect too much the whole overall picture because we have the Cerro Colorado pit. In Cerro Colorado, we are assuming... Basically, next year, we're mining minimum amount of material from Sandinista, just to be conservative. Next question is, will there be a Spanish withholding tax on dividends after the headquarters move to Spain? I think this question has already been replied. Success in coarse particle recovery and primary sulfide leaching would add 2 million tons to incremental supply in 2030. Thoughts on that? Of course, particle recovery gives a better recovery, but does not mean more copper coming on the stream. What they talk about primarily is sulfide leaching, basically in heap leach. They talk about extra 2 million tons of supply, but this has been already going for two or three years, and especially with the system called Jetty. The reality is that the only place where it has been applied in capstone, in... in arizona i have not seen any incremental production coming on that i have to say that this thing what they call primary sulfide leaching and sulfites it's a heap leaching which means you can extract things that are in dumps but it's not just irrigating with acid you need to have a liner you need to recollect that acid and you need to have idle capacity so it's not that simple to implement it's easier to say than to implement Yes, it may add some extra production, but I don't think that would be the change. Another thing is that these systems that they're talking, they increase, they improve the timing for recovering the copper from these heaps from infinite, which means it's not leachable, to years, not months, not hours, to three years, more or less. So even if you start applying them now, you will not start seeing the benefit until three years from now. our system of ELIX is totally different. You produce a concentrate and then you leach that concentrate and it's a matter of hours, not years or months. So I'm not so sure that this is going to be so fast. Another question is related to this. When do you expect to reach the first source recoveries costs from ELEX plan to the market? I would say after we commission this, which commission will, let's say the first few months of the year, 24, I would say mid second quarter or mid 24 is when we'll have results. Obviously before we'll be giving updates. Next question, the miscelliation of what are the net profit, net cash flow implications to move the Cyprus to Spain? Concern with holding tax on dividends, corporate tax increasing from 12% to 25%. Well, the first thing has already been discussed about withholding tax. And the corporate tax actually officially is 25%, but we are paying a little bit less than 20%. due to certain things. But in addition to that, really, at the end, the tax authorities in Spain considered the company as a profit here. So they're very careful not to think that the profits, a transfer of profits from here to Cyprus due to the regulation within the European Union. So I don't think from that side, corporate tax will be a big difference.

Yeah. And on top of that, Alberto, just to mention that some of the profit that we declare in Cyprus are related to intercompany loans, which will remain in Cyprus. So a company, a financing company will fund intercompany subsidiaries and basically that will also be continue paying 12.5% on taxes as we have already an office and a structure there to basically organize that. So not significant change there.

Yeah, well, there is another question about why move to UK. Why not move to UK? There is no withholding tax. Well, we have already said that the UK was our first choice, but there was a one off tax from the Spanish authorities. So it was quite a complicated situation. Then with all the tax and other questions, we have already discussed that. The next one is, if Atalaya is domiciled in Spain in the future, what's the effect on company shares tax-free again? Same thing. Given your high net cash position in house share price and low share price, would you consider a share buyback? Yes, we have been thinking that at the board, and we don't rule it off. well people say talk again about tax-free investment wrappers most common holding form in uk investors is is uh sipp is uk pensions um so another question several questions about that um another one is the same thing dividend tax unfortunately holders of atalaya c will not be able to recover withholding tax on dividends can you look Further, the Supreme Court authorities agree not to apply withholding tax on grants on most UK holders held through S&P. I think we discussed that. Any traction from your investment in ESG? Can you compare your green credentials against other copper miners? Are you listed in any ESG index? Can you go through this?

Yeah, so we have done, so we raised a small credit line recently which was basically used for the solar plant and we already have the benefit about better rates because that was for a purpose which is included in the taxonomy of the European Union. But yes, we're doing a lot of work on the ESG front and we're starting to see ratings related to ESG improving and we continue and I think we expect with the work that we've been doing to those ratings be even better, which again is with a name to have when we need to fund or raise funds for Toro and once we have the permit we will be in a position to get all this work done and we'll be able to get benefits out of this better rate. But yes, we've been rated by the most significant rating company on sustainability and we're improving since we got the last one a few years back.

Perfect. That's great. Alberto Cesar, thank you for being so generous with your time today and addressing every question there. And of course, the company can review all questions submitted today and we will publish those responses on the InvestMeet company platform where appropriate to do so. But before we direct the investors to provide you with their feedback, which is particularly important to the company, Alberto, could I please ask you for a few closing comments?

Well, again, thank you very much for attending. It's a long time. Thank you very much for sending so many questions. And of course, for those of you, feel free to, any of you, feel free to send any question to our addresses and we'll take the time to reply as soon as we can. So thank you very much for your continued support. It helps us a lot and we look forward to a fantastic Thank you very much.

Alberto Cesar, thank you once again for updating investors today. Could I please ask investors not to close this session as you will now be automatically redirected to provide your feedback in order that the team can better understand your views and expectations. This will only take a few moments to complete and I'm sure will be greatly valued by the company. On behalf of the management team of Atelier Mining PLC, we'd like to thank you for attending today's presentation and good afternoon to you.