Thank you for standing by. Welcome to the Allkem Limited June quarterly results briefing. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star, followed by the number one on your telephone keypad. If you would like to withdraw your question, press the star one again. For operator assistance throughout the call, please press star zero. Finally, I would like to advise all participants that I'd now like to welcome Martín Pérez de Solay, Managing Director and CEO, to begin the conference. Martín, over to you. Welcome to June quarterly results briefing. As usual, I will be providing an update on our business, and Christian Barbier, Chief Sales and Marketing Officer, will be providing us with a market update. Also joining us for the Q&A is James Connolly, our Chief Project Development Officer, Liam Franklyn, Head of Mt Cattlin Operations, and Christian Cortes, our Acting CFO. We have concluded the financial year with a very strong performance at both our operations. We have achieved record annual and quarterly production of lithium carbonate at Olaroz. At Mt Cattlin, quarterly production increased 50% from the prior quarter, and annual spodumene concentrate exceeded current guidance. Across the portfolio, we have made solid advancements in project execution. In Argentina, we are proud to have successfully achieved the milestone of first wet production at Olaroz Stage 2, while also advancing construction of Sal de Vida Stage 1. At Mt Cattlin, we confirmed the additional four to five-year mine life via open pit methods. In Canada, we progressed the IBA in relation to the James Bay Project to final stages. In Japan, Naraha has commenced in battery grade qualifications with customers. We continue to be in a very strong financial position. This quarter, we generated group revenue of $334 million, a slight improvement from prior quarter. We also achieved significant group cash operating margins of 82%. Group net cash at the end of the quarter was approximately $648 million. We continue to focus on our long-term strategy to develop, to deliver scale and product flexibility to customers and remain fully committed to the delivery and execution of our growth pipeline. The proposed merger with Livent helps us accelerate our strategy and derisk our growth profile while driving higher vertical integration into the EV value chain. We have advanced the transaction, and we are still targeting completion by the end of calendar year 2023. From a sustainability perspective, on starting with safety, we recorded a 12-month moving average total recordable injury frequency rate of 1.98 at the end of June, achieving our financial year 2023 fund safety target. Financial year 2023 TRIFR evidences a 24 improvement year-on-year, but a 15% increase quarter-on-quarter, as four recordable injuries occurred in Argentina. Investigations have been carried out with corrective actions implemented. The 12-month moving average lost time injury frequency rate target was also achieved, closing financial year 2023 with 0.62 incidents per million hours. Community [audio distortion] operate. Some highlights include positive community engagement with increased stakeholders in relation to the installation of eight photovoltaic systems to generate electricity for families residing in the Salar del Hombre Muerto. The facility is structured as a sustainably linked green loan that combines environmental and social targets. This quarter, our responsibility, our responsible and sustainable development of lithium for a greener future and economical growth in the province of Catamarca. Moving to our operations, at Olaroz, we achieved record annual production of 16,700 tons of lithium carbonate and record quarterly production of over 5,000 tons. This is a result of a strong operating performance, excellent plant reliability, low downtime, and improved energy efficiency. Lithium carbonate sales of over 3,400 tons were up 18% quarter-on-quarter and just end. Third-party sales were completed at $38,062 per ton FOB, as per ton. Up 19% quarter-on-quarter, due to elimination of extra incentives coming to effect and the rise of materials, labor, and energy, which have been impacted by inflation. Over time, unit costs will be offset as we progressively increase production volumes at Olaroz Stage 2, where we will focus on achieving product volumes and quality specification over a 12 to 18-month ramp-up period. At Mt Cattlin, we produced over 58,000 tons of dry metric tons of spodumene concentrate and achieved a 67% recovery. This demonstrates significant improvement in grade and favorable mineralization as mining has moved into the central zones of the main ore body. We shipped over 46,700 tons of spodumene concentrate and generated revenue of $123 million. Shipment of additional 11,700 tons slipped into July due to severe weather conditions, delaying loading at the port. The gross cash margin of 80% was based on cost of production of $830 per ton for the quarter, an average pricing of $4,179 per metric ton. At Naraha, we implemented some equipment, repairs, and improvements during the quarter. We continue to focus on increasing product quality and volumes through design capacity. We sold 464 tons of technical grade lithium hydroxide, and we're also commencing the battery grade hydroxide qualification process with customers. At Sal de Vida, we reached 98% construction completion of the first two strings of ponds. The first nine ponds have been completed and filled with brine. All ponds have now been lined. The engineering for the third string of ponds has also been completed. Earthworks have commenced. Detail engineering of the process plant progressed during the quarter. Process plant construction also advanced with mobilization of the EPC contractor and continuation of civil works, including delivery and installation of precast foundations and associated concrete works. Engineering at James Bay advanced to 72% completion by the end of the quarter, with a process plant package at 81% completion. Procurement of mechanical process equipment and mobile mine equipment are complete to 94% and 88%, respectively. Stakeholder and community engagement remains very positive. We've made significant progress on the IBA with the Cree First Nations and reached the last stages of the approval process. This has been delayed slightly with the evacuation of the local community due to severe forest fires. We will recommence once the situation returns to normal, and we will continue to support them through this difficult time. I will now hand over to Christian Barbier, who will provide us a market update. Thank you, Martín, and good morning, everyone. The markets over the last 12 months have been a tale of two halves, from the extremely tight, hyped market conditions in the first half of the fiscal year to the dramatic correction in the second half. This decarbonization is still an imperative, and battery storage remains a key enabler. Direct electrification through the use of batteries has been identified as the most efficient, cost-effective, and commercially available route to fully decarbonize road transport. We already observed that the transportation sector is undergoing profound transformation, and we can all agree that electrification is a foregone conclusion when we see penetration rates have reached 34% in China, 24% in Europe, and now 9% in the U.S. EV sales continue to increase at a significant rate, from $3 million in 2020, $10.5 million in 2022, to closer to $14 million in 2023. According to BloombergNEF, $27 million by 2026. We should not and cannot afford to become distracted by short-term volatility. There's been some concern over the recent futures exchange outcomes. Keep in mind that futures markets are not commonly used for markets for lithium product sales. They represent very limited small volumes relative to the lithium chemical markets, and as such, price indications are driven by short-term speculative sentiments and are not representative of the underlying physical market. During the June quarter, lithium chemical prices were observed to have rebounded and stabilized. Consensus views suggest a relatively stable pricing environment over the next six months, based on expectations of balanced supply and demand dynamics. I note that the market continues to be regularly surprised on the upside in relations to demand, with being repeatedly surprised on the downside on supply. We believe the market will be, at best, tightly balanced overall, and prices likely to be responsive to factors that may upset this tight balance. Olaroz has delivered in the last quarter better than expected production rates, both at Olaroz and Mt Cattlin. We expect this to continue. We're fortunate to be in the position to offer more volumes in an improved market. Olaroz has demonstrated discipline in which- T ry to commence the Q&A. Thank you. At this time, I would like to remind everyone, in order to ask a question, press... Additional questions may be entertained if our schedule allows. We will now take a short pause to organize the Q&A roster. Your first question comes from the line of Rahul Anand from Morgan Stanley. Your line is open. Hi, Martín and team. Congratulations on the result, thanks for the opportunity. Look, I just wanna talk on production for my one question. Obviously, how much was it helped by the extra brine availability? If we had to take that away, what is the underlying production rate now for Stage 1? Is it starting to perform much better than before, is what I'm trying to get some color on. On Mt Cattlin, you know, again, a good result there as well. How are we thinking about the setup of the asset going into next year? Just production related from me. Thanks. Well, thank you very much, Rahul, for your questions. Clearly, there's a significant improvement in the plan. The plan is currently operating at higher rates, higher recoveries, higher volumes, flowing through the plant, and significantly higher equipment availability time as improved maintenance programs have occurred. Clearly, moving into a significantly better ground, but there are some additional production coming from additional operation areas we discussed before. In Mt Cattlin, it's a significant recovery after a difficult first half of the year, and with a very solid second half of the year, I think, returning to normal operations in Mt Cattlin volumes. We are working on production numbers to be guided along with the yearly financial statements that will be released around the 20th of August. I think, we start getting close to that nameplate, that we've had as a target for a long time, pre your... We're getting closer, we're almost there, if you were to look at it in terms of, prime equivalent, production. Your next question comes from the line of Tom Hayes from CLSA. Your line is open. On, what is the main driver here? Were there environmental monitoring activities that have come out of your discussions with the communities that are sort of a follow-up on that draft environmental assessment report? Is there a meeting coming up with the community that's delaying an outcome? I'm just interested to hear from you, if you could sort of lay out the next steps to conclude that permitting process. Well, thank you very much for your question, Tom. Listen, many things to answer there. The good news is that the community were returning today to Eastmain, and that's very good news, you know, the quality of the air is back breathable there. What held the IBA process is the final discussion with the community on the IBA agreement was going to happen two weeks ago, that was delayed. We hope it's going to happen soon, and we're almost finalized with the IBA with the community. Regarding the ESIA, if you remember, we secured the approval from the federal authorities back in January. That approval came with certain requirements of environmental monitoring, was basically flora and fauna to be completed before starting construction. Those works have already been completed, and all requirements to start construction there have been completed. The remaining approval comes from COMEX, that is the joint body between the province of Québec and the Cree Nation Government. That is, you know, in which we expect to have clarity around the finalization of the process, you know, put forward. We expect to progress in getting that final approval quickly. However, I don't know- Thank you for that. Maybe just one follow-up. You flagged that, once we get that permitting of first production, I'm just wondering, will that come with sort of an updated view on CapEx and costs? Well, clearly, once we've got the permit, and we know the key issue there is how many winters, we have to go through with an updated timeline and cost schedule for James Bay. Thanks. Vickerson from Morgans, your line is open. Good morning, Martín. Can I just ask a quick question about the difference between sales volumes and production of Olaroz? Just especially given that it sounds like the production improvements may have been slightly anticipated. Just wanting to tease behind why sales volumes dropped so much, or was it just because production was kind of weighted towards the back end of the quarter? No, I think, well, production has been quite stable through the quarter, but I'll let Christian Barbier answer the detailed question on sales forecast. Yes, Max, thank you for your question. Look, yes, we've had a very strong production from Olaroz over the last two quarters. You may remember at the end of the March quarter, we had an inventory increase because production was already above forecast. We also had reduced internal requirements from Naraha at the time. We decided against selling immediately at the Chinese spot price, because at the time, the chart spot price to destroy value for shareholders, that price did not reflect market fundamentals. It was the right thing to do. We, the spot price inside China has recovered from $25-$40 during the second half of May, it has more or less stabilized since. During the June quarter, what we did is that we increased the level of spot sales and short-term contracts as soon as prices recovered, which is during the second half of the quarter. Most of the impact will be seen during the September quarter, because of order lead time, and also some shipping delays that we've had at the end of June into July. We also had, as you mentioned, a higher-than-forecast production in Olaroz, thanks to a really strong operational performance, which is great, about 1,200 tons higher than what we expected. Again, our consumption in Naraha has remained reduced, because we continue our process improvements, and we now have started the qualification with our key customers. Overall, good news, it has resulted in a temporary increase in finished product inventory. We're not concerned. Sales level will be higher and already are higher in the current quarter, and will continue in the December quarter without compromising the realized price. fantastic. That's very clear. Thank you. To Naraha with, you know, not necessarily needing a lot of volume at the moment. ... extra inventory do anything? Is not impacted by Stage 2. We've started that process. We've had, six and 12 months. Excellent. Thanks very much. Your next- To the team there. My question was on cost at Olaroz. The removal of the export duty, is that the pre-now credit? another line item in the, in the profit and loss statement. Obviously will go through a process of commissioning and ramping up. At steady state. For both assets or guidance in general, I guess, with your financials in August? Commentary around Olaroz, particularly, on the basis that, you know, there's a certain period on which how that's gonna look like during commissioning. As we've said in the past, that process takes over a 12-month period, so we don't think it would be reasonable for us to estimate that with a level of accuracy for the market. For Mt Cattlin, once we talk about volumes, we can then provide color around what that expected cost may look like. Okay. Thanks, Christian. Thank you. Your next question comes from the line of Mitch Ryan from Jefferies. Your line is open. Morning, all. Thank you very much for taking my question. Simple one. Naraha is starting to ramp up quite well. I'm just wondering if you can provide some color on just the ramp-up profile, to name plate? Naraha started quite well. As you know, during ramp-up period, you evidenced some issues which we sorted out during the quarter and in general, maintenance of some of the equipment. Plant continues to do very well. There's not a significant market for technical grade product. You will see the volume of Naraha ramping up to nameplate. There's no issue in getting to nameplate capacity there from what we have. It's a combination of how quickly the customers answer on the qualification of the products. Then, you know, we're getting to those customers. We could start producing more, wouldn't make sense to sell technical grade hydroxide into a market that doesn't price it well. Okay. Thank you. Your next question comes from the line of Al Harvey from JP Morgan. Your line is open. Yeah, morning, Martín. Just wanted to touch on, again, get a sense of if there's any jurisdictions you're particularly concerned about. I guess as a quick follow-up. Financial information, it will incorporate the annual financials, which are expected to be delivered to us the second half of August. From that, it may take another three or four weeks to complete the independent expert. We should be seeing it in the second half of September, according to our current schedule. Thanks, Martín. Just one quick one, if I may. You did mention in the release, a lithium carbonate by-product was sold. Not small, but just what was that and what kind of customer or end use was that for? Yeah. Christian, can you? A few 100 tons of a by-product that we had been producing progressively over the last, two or three years, and we took advantage of the high spot prices between October and April to sell these. These were sold to technical applications, industrial applications, non-battery applications. Does that answer your question, Al? Yeah, thanks for that. Christian, just looking at your tax paid in the quarter and I guess last quarter as well, looks just a little bit light. Just wondering if we'd expect to see a catch up on that, sort of, cash tax paid in the first half of FY 2024? Christian, you are muted. Hi, Hugo. Sorry. Yes, the tax paid, both previous quarter and current quarter, relate to Mt Cattlin. That's effectively an advanced payment, which will true up once we close the year. Does that answer your question, sorry? Yes, if that's, if all the tax paid is in relation to Mt Cattlin, I guess, how should we think about Olaroz, sort of, tax payment going forward? Yeah. Yeah, absolutely. Olaroz will certainly be paying cash this financial year. It's a matter of effectively finishing the year and submitting our tax return. The expectation is that we'll be paying tax from here onwards. Great! That's helpful. Thanks, Christian. Maybe just one for James. Any progress on the DLE technology selection at Olaroz? Are you still expecting to start piloting some of the shortlisting technologies later this year, and how are studies progressing on a potential Stage 3 there? Thanks. Thanks, Hugo, for the question. The technology screening has gone extremely well. As we indicated, we are going more conventional on that side, focusing on, let's say, a first stage evaporation. On the DLE itself, we'll be looking at or making the decision around, and our process design team will be looking at that. In terms of the advancement around that, we've focused on the hydrodynamic models. We've completed that work. We're quite happy with the results, and that will lay the basis for our teams both to explore that evaporation case as well as a future state DLE case. Very good on the hydrodynamic side. In terms of piloting, the process development team has scheduled piloting for this financial year coming, so we look forward to updating you as soon as we get that piloted. We will be using the Salar del Hombre Muerto site, which will be a great, where we did some really good work on Sal de Vida. We'll use that same laboratory, just kitted out with the DLE technology and advance that going forward. Great. Thanks for that, James. Pass it on. Your next question, David, your line is open. Good morning, Martín and team. Thanks for taking my questions. Timeline of Sal de Vida. It's great to see that we are making further progresses this quarter, and maybe have more color on quarter. Are we still expecting first production in mid-2024 now? David, we've made good progress. Sorry, Martín. We engaged with Turner & Townsend as we spoke the last time. They are at the later stages of that review on the rebaseline activities. We're currently doing the quantitative risk assessments at the moment. Within this quarter, we will be in a position to update the market both on cost and on schedule. At the moment, we will keep the guidance as is until we do the work and can have that spread and certainty around what our forecast will be. Okay. Thanks, Christian. That's really helpful. A quick question on there's no low-grade sales recorded this quarter. Is this just a pause of sales or shall we expect- More and more money selling the high-grade concentrate and the lower grade? Whether that's for future outlook, You may remember that we said it was really about giving additional lithium units where we experienced. Morning, Martín and the team. Just wondering if you could provide some color on the Naraha plant ramp up and the modification work you did during the quarter. Do you need to do more work? Thank you, Austin. As I said, it was not modifications, it was miners, and it's all good. I don't expect major modifications, and there hasn't been any major modification in Naraha. It has mostly been, as I told you know, adjustments on equipment that were evidenced through the ramp-up period, as it usually happens. Great, thanks. Just one quick follow-up. Any color you can provide on the future shipments to Naraha plant from the other operations? Thank you. They're mostly related to the amount of, sales- Amount of product. Great hydroxide. Yes. Sorry, the amount of lithium carbonate sent to Naraha. As you know, Naraha, at full capacity, can produce 10,000 tons of lithium hydroxide, which requires about 9,500 tons of lithium carbonate to be produced. You know, the shipments to Naraha would be directly related to the amount of battery-grade hydroxide sales that we achieve in Naraha after completing the qualification process with the customers. Thank you. As a reminder, if you would like to ask a question, please press star one on your telephone keypad. We do have some follow-up questions. Your first is from Kate McCutcheon from Citi. Your line is open. Hi, thank you. Just a quick market question now, [audio distortion]. Can you provide some expectations, please? Yes, Kate, thanks for your question. Look, when we look at the market at the moment, as I mentioned in my opening comments, we expect stability during the September quarter. The market seems to have come down in terms of prices and demand remains robust and is expected to continue to increase. Having said that, we've seen a lot of volatility in the last six months, and we do have quantities of spot material to sell, both in carbonate and in hydroxide. Our exposure to the spots is in our portfolio, and part of our quarter sales are not yet priced, so it would send a signal to customers and to competitors alike, and that would be totally inappropriate. This is the reason why we're not communicating a guidance. Okay, understood. Thanks for the comment. Your next follow-up question comes from the line of Tom Hayes from CLSA. Your line is open. Thank you very much. Just to follow up on Mitch's question around the ramp of Naraha. Is the implication here that you can actually run that plant sort of on a tons per day basis at 100% today? As we proved through the ramp-up process, as I said before, the market for technical grade hydroxide is not very strong and doesn't make sense to produce a lot of technical grade hydroxide. We are ramping up the plant after the modifications according to the sales orders that we expect from the customers after completing the plant was very quickly ramped up in terms of capacity. Fantastic. Thank you. Some sort of a alliance, you know, some other headlines that we've seen recently, Mexico amending their mining law, to place higher environmental standards and use of water in the mining sector, and also just headlines around the upcoming election. I'm just wondering if you could make some comments on what that association might look like going forward, and also any comments that pertain to your lithium operation, you know, or any impact that the election has on your operations going forward? Yeah. Good. Thanks, Tom. That's a difficult question because it requires to do some forecasting on politics, which is quite difficult in this part of the world. Listen, yes, we also those news. Something that is important to bear in mind is that those news were mostly supported by the national government in Argentina. However, in Argentina, the natural resources are under the custody or under the responsibility of the province. Provincial governments are against changing anything within the existing mining law. We, based on the current configuration of the law and how the system works in Argentina, we don't foresee such an association having a direct impact on any of our operations for the time being. With regards to the potential impact of the elections, we have seen that most of the extreme candidates have weakened over the last few months in the run-up to the primary elections that will happen within two weeks. As of today, the polls are showing that most of the center-type candidates are running up. And in that regard, you know, one of the candidates comes from the previous government that was quite supportive of the lithium industry. The other one comes from the current government, that was also quite supportive of the lithium industry. We don't foresee a significant challenge coming up from the elections in Argentina. I'm not sure what if that answers everything, or there was a second part in your question. That's fine. Thank you very much for the color. Your next question comes from the line of David Deckelbaum from TD Cowen. Your line is open. Thanks for fitting me in, guys. Martín, Or maybe Christian, I just had a couple questions about Mt Cattlin and the order reserve update, if you had a moment, by August of this year? My follow-up to that is just as you think about the end of the period... Confidence, following Tom's question from before, I think that the market continues to be confident on the availability of resources in Argentina and the ability to develop them. Yeah, that's pretty clear. Thanks for the additional detail there, Martín. Cheers. Your next question, a follow-up from Hugo Nicolaci from Goldman Sachs. Your line is open. Oh, hi, Martín and team. Thanks for the opportunity to follow up. Public comments from both the U.S. and Argentinian officials around Argentinian lithium finding a path to some IRA support, that seems to have been pretty quiet recently. I mean, do you think that that's just linked to Argentinian election timing, or maybe could you just comment on the latest you're hearing around what those discussions are looking like at the moment? Thanks. Thank you. Well, I think it's, listen, Hugo, this may be of speculation. It's an Argentine talking about U.S. legislation, so. We have seen the U.S. Department of the Treasury being slow in answering the questions that or the comments that were posted on the IRA. I was talking to some lobbyists in Washington this week. The view that they got with Japan in terms of the critical minerals such boosted a number of comments and discussions. We think those discussions are going to be a bit slower than we all expected. Nonetheless, and I was with the Argentinian embassy as well, it is a country effort, and all of the companies operating in Argentina are supporting the country to find that path for the Argentine lithium into the IRA requirements. That continues to be the case. It's, you know, clearly we lose some focus from the Argentine authorities as we get into the middle of the election period, but the effort, the intention, and the focus continues to be there. Great. Thanks so much, Martín. Maybe just one last one, just around, like I say, you're seeing customer conversations with in terms of offtake and volume since announcing the merger. You know, have those conversations, you know, changed in terms of what they're seeking, in terms of maybe being, you know, diversified contracts from seeing discussions shift, given that maybe you have a greater sort of security of supply that you can provide from a bigger portfolio? Customer engagement could happen around these days, with regards to the merger. Until the deal is finally voted, both companies will operate separately. Nonetheless, support from customers and indications of interest have been quite good with regards to the merger, because we will be a larger company, with a larger asset base, with a larger, industrial base, being able to supply customers, globally and with a significant pool of flexibility, meeting all of their requirements. As you said, you know, having a larger asset base, being able to supply from different assets, it's all good news for customers. Livent and Allkem, we have both received quite optimistic or quite promising comments from the customers with regards to the merger. From that regard, I'll tell you, it is as good as it could be, given the current antitrust regulations that you are not able to get into detailed discussions at this point. Yeah. Thanks for that, Martín. I appreciate that. There are no. Thank you very much, Polly. As concluding remarks, I can tell you that we have achieved a strong quarter with solid progress, and we continue to focus on strong operation and managing costs throughout our global portfolio. Thank you for joining us today. If you have any further questions, please don't hesitate to contact our investor relations team. This concludes today's conference call. Enjoy the rest of your day. You may now disconnect.