Nickel Asia Corporation

Thank you to the PLUS team and Adrian for that very engaging discussion. So next in our lineup, we're pleased to welcome Nickel Asia Corporation. Presenting on their end will be Mr. Andre B., Vice President for Finance and Corporate Planning and Deputy Chief Finance Officer. Joining him in the Q&A will be Mr. Dennis Zamora, President and Chief Executive Officer. Moderating this session will be Mr. Gab Aguila from Sun Life. So now as we begin, please turn your attention to the video as we get to know more about nickel.

In 2008, we decided to bring our sights into one umbrella. Today, we are a natural resources development company, harnessing minerals and renewable energy sources. As stewards of our country's resources, we take to heart the privilege that comes with our responsibility. And so, we remain committed to driving growth through products and services that contribute to creating a green economy. For our communities. For our earth. For all of us. We are NAC.

Good afternoon. Good afternoon to the participants of the PSE Star Day. I'm Andre D. for Nickel Asia Corporation, and I'm happy to be here with you, together with our CEO, Mr. Dennis Zamora, and our Chief Commercial Officer, Mr. Koichi Ishihara, and Miren Kueto, who is part of the Investor Relations team. We're here to present Nickel Asia Corp.' 's nine-month results. Yeah. So for the financial highlights, let me go straight here. And if I could, we could just pay attention to the left most bar chart on the upper part of the screen. It indicates our top line performance. So for the first nine months of 2025, revenues have increased 35% improvement year-on-year to 22.8 billion from 17 billion, and that's because of the favorable nickel ore prices, specifically because of the saprolyte ore exports. The bar chart in the center displays our consolidated EBITDA for the period. So that's close to 11 billion pesos. It's a 65%. improvement from last year's 6.6 billion. Again, the profitability driven by better ore prices and more efficient mine operations. So we've already surpassed our full year 2024 EBITDA with the nine months because of the circumstances surrounding the nickel ore price dynamics. Then the rightmost bar chart is our attributable net income. That's for the nine months, it's 5.2 billion. So it's doubled from last year's 2.6 billion. This puts us about 1.9 million ahead of the full year 2024 core net income performance. So the improvement in net income is due to the higher direct shipping ore prices. These are up 52% year-on-year. And another is our one-time income from the 1,800 million generated from the sale of our stake in Coral Bay HVAL plant earlier this year. And then if you refer to the table below, the first row summarizes our gross profit margins. It stood at 63%. So this is up 8 percentage points compared to the same period last year. Second row is our EBITDA margins. These stood at 48% for the first nine months. That's an improvement of 9 percentage points. So despite OPEX increasing due to more volume, we were still able to achieve high EBITDA margins. The next row indicates our net income margins. These also increased to 32% from 22%. Now moving on to the next slide for the mining highlights. The first set of bar charts on the left shows us the nickel ore sales volume sold. So green portion represents the saprolyte exports while the orange portion represents the limonite H-PAL deliveries. So mining sales volume increased 2%, totaling 13.89 million wet metric tons. Ore exports, which is around 40% of mining sales, reached 8.32 million wet metric tons. This is up 3% year-on-year. And HPAL deliveries totaled 5.57 million. That's a 2% increase from previous year. The middle bar chart is a change in ore prices. So the significant change is the average prices registered for saprolite, which is $37.52 per wet metric ton. That's a 52% increase from last year's average price of $24 per ton. And then for the limonite H-PAL, there was a decrease of 6%. And the price to $10.17 from last year's $10.78. This is due to lower nickel LME rates, which is a factor when considering for the price of HPAL delivery. And this is because of the global oversupply for nickel metal. But due to the more favorable saprolite ore export prices, we can see the rightmost bar chart, the combined ore revenue rose by 41%. So that is at 20.96 billion pesos. Table below gives us additional context on nickel prices. The first column indicates the average nickel LME price per pound. So for the first three quarters of the year, it amounted to $6.87 per tonne. It's lower compared to the $7.75 per wet metric ton last year. Nickel LME are still weak at the moment because of the global oversupply of refined nickel metal. However, the supply of raw nickel ore remains tight and limited, which explains why ore prices remain elevated. Below this, we have a summary of nickel pay factor for our ore exports. So nickel payability for ore exports for the whole nine months is very high. It's at 27.31% compared to last year's 6.68%. So even with low nickel LME, nickel ore prices remain higher. And that's because of the tightness of ore supply in Indonesia and in the Philippines combined. So in Indonesia, it's due to the mining quota permit issues, while the demand for ore processing remains strong in their country and also in China. Another thing to explain here is the nickel pay factor for the HPAL. You would notice that this year, in the nine months, it had increased to 9.9% from last year's 9.24%. So despite nickel LME falling down, we've been able to successfully negotiate better prices with our customers through the HVAL plan, the demonite ore from us. Next slide. Now for the revenue analysis, so we'll show you a waterfall, just to dimension where the gains in revenues are from last year. So a big part of that gain is the improve or export prices. So that's the main contributor. That's almost 6 billion pesos effect. Then the other parts that follow that is the more shipments contributed from Rio Tuba and Manikani, a mine that we just recently opened. and all other effects are due to slightly lower average FX lower limestone deliveries and no TSF activities for the year next slide then on the cost side there's an increase in cost but it also goes with more ore that's been produced So because of the 3% increase in ore, we also saw some increases in mining costs. There's also contribution from depreciation. And of course, the ramp up from the new mine, the Manikani operations. And also higher excise tax and royalties because of higher prices of the ore. So really, it's more variable. That's driven the increase in cost and expenses. Next slide. Now for the investment in HPAL equity losses, we completed the sale of our 15.625% equity in Coral Bay. So for this year, we were able to trim our losses in our equity investments. If you look at it year-on-year, it's a 59% improvement or reduction from the same period last year as a result of our divestment in Coral Bay. Next slide. Now for the balance sheet highlights. Our total assets had grown by 10%. We are now at a $67.6 billion asset base from last year's $61.7 billion, primarily driven by a generation of more cash and cash equivalents because of the better ore price. So now that cash stands at $18.9 billion. So that's an increase in our cash, short-term cash investments, and cash-managed funds. Trade receivables, likewise, increased by 31% from higher sales. Our liabilities, not so, just an increase of 10%. Notable movements include short-term debt increase, 10%. It's a long-term debt, that's a significant increase, 85%. 2.1 billion to 3.8 billion this year. So these are really from the proceeds from bank loans used to fund or construct our solar project in Subicawag. Our equity grew by 10% to 48.6 billion. This is an 8% increase in equity attributable to the parent now at close to 40 billion pesos. And then in terms of gearing ratios, gross debt ratio is low at 0.28x. And then net debt ratio, we are actually in a cash position, so that's at 0.04x. So, yeah, we are in a net cash position. Next slide. And we just recently announced cash dividends that we declared. It's a special cash div. It's more than the dividend policy of regular payout. So last November 11, we announced and declared a special cash dividend of $0.07 per common share, payable on December 15 for shareholders on record of November 28th. So this brings total dividends declared by our company to 18 cents per common share. That represents a payout of 80%. 80% payout of previous year's net income. Now we move on to renewable energy. So our GSI project, our pioneer project, this is the visual of our operations in Mount Santa Rita, situated within the Subic Bay Freeport Zone in Zambales. This is run by Jobim SQM. So the site has installed an operational capacity of 172 megawatts. It's one of the largest in the country coming from a single solar power generation plant. The table on the left indicates the current off-take profile of Santa Rita as of the 9 months of 2025. 89% of energy sales mix is from PSAs. The remaining 11% is exposed to the USM. Moving forward, the direction is to fully contract the JSI via PSAs. Next, as we move to the financial highlights, for the nine months, 2025, generation is up 2% year-on-year to 171,279 MWh. EBITDA for the nine-month period is at 617 million pesos. It's a decline of 16% year-on-year due to the lower tariff rates. However, because JSI sales are predominantly secured through PSAs, The decline in Western prices during this period was mitigated by the PSA contracts. Next slide. Now for the pipeline. Here, this is our project that just recently turned on, the San Isidro later project. So this is the first project with Shell Overseas Investments BV. under a joint venture company called Greenlight Renewable Holdings Inc. The latest project is divided into two phases. Each phase will contribute an additional 120 MW or an attributable 72 MW capacity to EPI's portfolio. For Phase 1, energization, testing, and commissioning already began last October, and COD is targeted for the second quarter of next year. For the Phase 2 of Leyte, another 120 MW, the notice to proceed has already been issued and the construction of the solar facility started in the first quarter of this year. We anticipate energization to commence in the second quarter of 2026 and COD to take place in the third quarter of next year. This is our San Juan Botolan Sambales project. Again, it's in partnership with Shell through Greenlight. So this will add a total capacity of 59 megawatts. So an attributable capacity of 35.4 megawatts. for nickel asia for api as seen in the photo the botolan project is in its early stages pre-development activities have already been completed and land possessory rights have been secured last october the notice to proceed was issued we are targeting energization for both phases to be by the third quarter of 2026 and the commercial operations to begin by fourth quarter of next year Moving on to the Subic Kawag project. So this is solely developed and managed by Emerging Power Inc. Here is a visual of the project in Subic Kawag. We are developing a 145 megawatt facility divided into two phases. For the first phase, which is 70 megawatts, as you can see in the picture, construction is currently underway. and we are targeting to test and commission this by end of 2026, and commercial operations to commence by the second quarter of 2027. The construction for Phase 2, or 75 MW, is expected to commence before the end of this year. Target energization is for third quarter of 2027, and commercial operations will begin by early 2028. This next slide is our project in Nazareno, Bataan. This is a 50 megawatt project that is currently under pre-development activities with land possessory rights already secured and the EPC bidding already completed. Construction is targeted to commence by second half of 2026. It should also be noted that we are actively assessing the integration of battery energy storage systems to maximize the project value and operational efficiency of the Nazareno project. This marks the first among our RE initiatives to formally incorporate BES as a component. Next slide is the project capacity buildup of generation assets. From what I mentioned, this slide from those projects that were mentioned prior to this, so we anticipate to reach gross installed capacity of 293 megawatts by 2025. 5 by and 542 megawatts by 2026 by 2027 with several projects as mentioned already in advanced stage of development we are targeting a total gross capacity of approximately 1100 megawatts Previously, our guidance projected an installed capacity of 1 GW by the end of 2030, so barring any significant delays, we now expect to achieve this milestone by end of 2027. Other Updates So for the CAPEX, we've broken down the CAPEX for the mining business, for the gold business, and also for the renewable energy business. For mining, we spent approximately 1.15 billion during this nine-month period for the year and expect to catch up and invest an additional half a billion by year-end. This year's mining CAPEX was primarily focused on reflating, replacing and upgrading mining equipment for both our existing operations and our new mine in Manikani. We also allocated capital for construction of a new causeway in Dinapige in Isabela. And looking ahead to next year, we anticipate spending approximately a lower amount at 1.2 billion, with the bulk of this being earmarked for refleeting activities. The big part for our capital expenditures is really in our renewable energy business. CAPEX was approximately 4.6 billion during the nine months, and we forecast to add an additional 6 billion for our projects that are being developed. So these investments are tied to the planned notice to proceed for our Batolan solar project. as well as the continued construction progress for both Kawag and Leyte projects. For next year, we anticipate a total CAPEX of around 8.7 billion, with 5.1 billion allocated to green light projects such as Leyte Phase 2 and Botolan, and 3.5 billion earmarked for the ongoing development projects of Kawag and also Nazareno. We also have CAPEX allocated for our gold and copper exploration company, Cordillera Exploration Company. For 2025, mining exploration costs under SECSI are projected at $127 million. And then for next year, we anticipate allocating around $221 million for gold and copper exploration. The next slide will provide further details on the status of this aspect of the business. So for gold and copper, for SEXI, our JV with Sumitomo Metal Mining, we are happy to report that we have confirmed the presence of gold-bearing veins and porphyry copper-gold mineralization. So the highlights from the recent drilling program conducted at the San Luis Prospect, which is situated in the southern section of the tenement, are as follows. There's a gold-silver intercept, so 4.6 meters grading, 15.5 grams per ton of gold, and 85 grams per ton of silver, from 69.9 to 74.5 meters in drill holes. And copper-gold intercept is 50 meters grating at 0.50 grams per ton of gold and 0.42% copper from 300 to 350 meters. So what this tells us is these results are encouraging and strengthen our confidence in Cordon's project potential and reaffirm our commitment to advance further exploration activities throughout the year end with the goal of further delineating the gold-bearing veins and defining the depth and extent of mineralization. Yeah, so that ends our formal presentation and we'll be happy to open the floor for questions. So I'll hand it over now to Mr. Gab Aguila to facilitate the Q&A.