Thank you for standing by, and welcome to the South32 half-year financial results outlook H1 FY22 investor and analyst call for the United Kingdom and South Africa. All participants are in listen-only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. I would now like to hand the conference over to Mr. Graham Kerr, CEO. Please go ahead. Thank you. Good morning, everyone, and thanks for joining us today for our financial results conference call for the half year ended 31 December 2021. I'm joined today with our Chief Financial Officer, Katie Tovich, our Chief Operating Officers, Jason Economidis, and Noel Pillay. I will give a summary of our results before handing back to the operator for questions. The most important commitment we make at South32 is that everyone goes home safe and well. During the half, we didn't achieve that. In November, we tragically lost one of our colleagues, Mr. Desmond Menezes, a contractor with Electra Mining, who was fatally injured while working at our Wessels mine at South Africa Manganese. My deepest sympathies are with Mr. Menezes' family, friends, and colleagues, and we have provided them with our support. We undertook a detailed investigation to understand what happened, and we are sharing these learnings across our business. During the period, we initiated the safety system of work, a multi-year program to design and achieve a step change in our safety performance. We will never be truly successful until we eliminate fatalities and significant incidents. Our teams around the world have worked incredibly hard to deliver a strong set of production results during the half, and we have achieved some significant milestones with the reshaping of our portfolio for a low carbon future. During the period, we achieved a record operating margin of 44% and a significant increase in our underlying earnings to $1 billion, benefiting from a broad recovery in commodity prices and the divestment of lower returning businesses. We maintained our focus on operating performance, holding the increase in controllable costs to less than 3% of our total cost base despite significant inflationary headwinds. We delivered record quarterly production of Brazil Alumina and South Africa Manganese, while at Worsley Alumina, we continued to operate above nameplate capacity. At Cannington, we revised production guidance 5% higher as we prepare to transition to 100% truck haulage in the June 2022 quarter, bringing higher-grade material forward in the mine plan. We also achieved a 26% increase in payable nickel at Cerro Matoso following the completion of the furnace refurbishment and the first ore from our higher-grade Q&P project. Production guidance has been revised lower for Illawarra Metallurgical Coal and Australia Manganese, reflecting lower first half volumes and the impact of COVID-19 on those operations. During the half, we generated a substantial improvement in free cash flow and distributions from our manganese business to $942 million, despite a temporary build in working capital caused by logistics congestion. We also delivered a very strong return on invested capital of 25%, and we finished December with net cash of $975 million, which increased to $1.1 billion by the end of January. Our strong financial performance has translated to increased returns to shareholders, with a record dividend of $0.087 per share and a further $110 million added to our capital management program, with $302 million now to be returned. We have made significant progress reshaping our portfolio with the divestment of South Africa Energy Coal, TEMCO, and Metalloys, which is expected to sustainably lift the group's operating margin into the future. We're adding copper to our portfolio by acquiring a 45% stake in Sierra Gorda in Chile, and we completed a pre-feasibility study for the Taylor deposit at Hermosa in Arizona, demonstrating potential for a sustainable, low-cost operation. We're also increasing our exposure to green aluminum, increasing our shareholding in Mozal Aluminum, and participating in the restart of the Brazil aluminum smelter using renewable energy. We are well-placed to continue our strong performance, remaining focused on delivering safe, stable production and realizing value from the improvements we have made to our portfolio. Thank you. I will now hand back to the operator for questions. Your first question comes from Sylvain Brunet with Exane BNP Paribas. Morning, Graham Kerr, well done on the numbers. Two questions for me at this stage. On coking coal, given the extreme tightness of the market, I was keen to get a bit of a sense of how much you're able to capture in the spot market compared to the contracted take-or-pay and your sense of, you know, how long this tightness can prevail and where you're seeing any sort of revival of new supply or logistics that can impact in Mozambique at the moment, for instance. My second question is on Sierra Gorda. If you could help us with a little bit of guidance on costs and volume, please, over there on the pace of the increased production going into the next year in particular, but some color on cost for this year would be helpful. Thank you. Yeah. Thanks, Sylvain Brunet. Nice to hear from you. Look, can we talk about Brown coal and maybe start with the market? You know, obviously, met coal has had a really strong run in terms of pricing. You know, we would actually see if you like, in the shortest term. When I say shortest term, you're probably looking at something around, you know, the month M+3, that we would expect the price to maintain above $300 a ton, and that will be supported by ex-China restocking demand and obviously tight supply at the moment. You know, we did see obviously a sharp increase, you know, month-on-month, even in January, a 24% increase, and that's been mainly driven by tight supply from Australia, where COVID-related constraints and weather-induced eruptions have basically led shipments to decline, about 2% for the month-on-month and 8% year-on-year. That certainly had an impact. Look, I think what we would say, you know, if you think about 12 months down the track, so probably about M+12, we'd probably see the price moderate, and probably, you know, back towards that more $200 a ton would be our view on where that's actually going. Look, your question on how do we sell, we pretty much sell all the product on an index, M or M-1. That's what all our sales are. Sierra Gorda. Sierra Gorda, to give you some background, you know, obviously as part of the completion process or the conditions precedent, we spoke about the steps that we had to take, with the major ones being competition clearances. We have all those competition clearances now. You know, we're going through more of the procedural aspects of completing the transaction. We would expect that to be, as we said, in February, so not too far away at all. In that, we would actually give some updated guidance about where we see it actually going. Otherwise, the best guide at the moment would still be the guidance that we provided as part of the acquisition case, which I can get Tom or Alex to follow you back on that if you wanna see that. When we actually close the deal and we're actually starting to participate in some of the operating committees, then we'll come back with a bit more tighter view on cost production guidance. It's not far away if you can be just a little bit more patient, but otherwise, at the moment, I think the acquisition case has the best, if you like, numbers we have available. Okay. Understood. Thanks, Graham. Your next question comes from Myles Allsop with UBS. Please go ahead. Thanks. A few quick questions first on working capital. You know, what drove the big build, and how quickly will it unwind in the second half? Yep. I mean, working capital, I'll get Katie to talk to that and also how we're seeing it going forward. Yeah, sure. Look, we did see that $333 million increase in working cap during the period. Almost half of that was sitting in inventory, and the vast portion of that related to some logistics challenges we had in our aluminum value chain, predominantly out of South Africa. Clearly, high prices are beneficial, so working cap lifting to absorb the higher prices on receivables, while we see our day-to-day stay constant, is not a bad thing for us. Certainly we're not seeing any blowout in sort of the underlying drivers there in terms of receiving or collecting cash. But the inventory build, we are, The marketing team's been working very hard to look at alternative logistics options out of South Africa, and they're putting those in place at the moment. We did see a slight incremental increase in working cap in January, but we do expect to see the inventory component of that unwind as we head towards the end of June. And then certainly, you know, price and FX is really the other key variable in terms of provisions and receivables. The bottom line, if you look at, there's a map, you can have a look at port congestion in Richards Bay for the last couple of months. It's just essentially been jammed with vessels sitting there. It's a combination of COVID impacts, COVID delays, but also some challenges around Transnet have all contributed to massive port congestion. Probably just the last thing to add on that, as we restart the aluminum smelter in Brazil, we would expect to see working capital come into the system related to that. That will have a slightly mitigating impact on any unwinds on the inventory side. Okay. Should we assume that as port congestion at Richards Bay eases, then all this working capital will normalize? There's no structural increase that we should expect, you know, from South Africa and aluminum at least. Yeah, that's right. Look, I mean, our operating window, we're at the moment, we're sitting outside that physical operating window, so we are looking to bring that back in line by the end of June. I think the key there is, that Katie alluded to, we're looking at alternate ways to actually until that congestion alleviates, because it's not just us, everyone's feeling it, the coal players, you know, all people that go through that port. Until that alleviates, we are looking at some alternate ways of actually moving the product out there, little bit on road, different type of vessels. The team have been quite, you know, imaginative in that space, and we should see some of the benefits coming through. It certainly is a challenge at the moment, the entire port. Okay. Thank you. Next question is just on Hillside and the decarbonization. Has there been any sort of meaningful progress at this point, or is it still kind of at the discussion stage? Yeah, the way I think about it, I mean, Noel can talk to the team. I mean, what we can be very clear is, from our perspective, there's a technical solution to this, probably on multiple fronts. You know, a simple one about a combination of wind, combination of solar. There's also potentially, you know, already existing nuclear capacity they have in space, in place, how you actually potentially utilize some of that. I think the probably biggest positive news since last time we did our results is the announcement by the, you know, EU, the U.K., the U.S., France and Germany to invest significant, you know, $ billions, if you like, into actually greening the network in South Africa. You know, what we've gotta continue to work on is basically the policy changes. You know, there's still some tension at the political level and in the ANC around the role that coal plays versus what the role of renewables is gonna play. Noel and the team are working very clearly on how we continue to articulate that. Because, you know, the thing that government needs to understand is roughly 30% to 40% of the product we produce goes downstream into South Africa, to companies like, you know, Hulamin and Isizinda, who then make parts that go into autos that go into Europe. To keep that sort of, you know, more skilled, more value-adding jobs alive, they're gonna have to find a way to actually green. I don't know, Noel, if you wanna add anything to that at all. Yeah. Thanks, Graham. I think just to add that we've now mobilized a high-powered team, you know, to work on this project. To your point, you know, I think in the first instance, you know, just to rally the stakeholders together to influence policy. That work, I think the technical work that you alluded to started already. You know, the project is now in a pre-feasibility stage. You know, we've done a concept study, and we've seen a menu of options. Like Graham said, it's, you know, technically complex, but that's just part of the issue. You know, working with the stakeholders to influence policy is really where the work is. Thanks, Graham. To manage expectations there, you know, we talked about that 50% reduction in Scope 1 and Scope 2 targets by 2035. The current power contract goes for 10 years, plus an option to extend a couple of years. You know, there's a lot of stuff we need to work through there, where the government's gonna take a bit of time to move, a bit of time to build the capability. One thing we should add is the CEO of Eskom, André de Ruyter, has been hugely supportive of this, and he is also very focused on how he greens, you know, if you like, his network. I think there's a lot of things pointing in the right direction, but it will take time to get that in place. We've got time with our targets. We've also got time with the current power agreement. We also obviously need to develop a plan B that if we can't get there, what does a just transition look like and how does, you know, the people of South Africa manage that? Because Hillside is a massive employer and brings a lot of economic benefit to an area that probably is struggling for that. Yeah. Maybe just a last question and I'll hand it over. Just thinking about CapEx and where do you think CapEx will kind of sit over the next five years? Obviously, you've given guidance for this year, next year, but how do you think that's gonna trend now that Hermosa's in the mix and there's some real spend coming through? Can you give us a sense as to the profile at least? The way I think about it, and Katie can give you a couple of comments, to me, it's all about competition, and there's no absolute certainties. I mean, we gave some very clear guidance on safe and reliable capital that's been in place for a while. In terms of the growth capital, you know, whether it's the injection of more money into South Africa to sort of get more of our manganese off the road onto the rail, that is all gonna compete on a returns basis, including the option of returning cash back to our shareholders. I think that piece, particularly, you know, safe and reliable is pretty straightforward for us because we do that to make sure our people are safe and well and our equipment is maintained. You know, the improvement capital, the growth capital, that all basically competes on a continuous basis. I don't know, Katie, you got anything to that? Yeah, probably just to add to that, you know, we have talked about decarbonization capital. Again, most of the CapEx that we're looking at or projects we're looking at in that space are, you know, value accretive and will compete on economic grounds. We're starting to see more study work in that space and progressively we'll complete, you know, pre-fees, fees and so on and provide guidance as we move forward, but not a huge lick of capital in that space in the forward plan based on our current study work. Probably worth calling out, we did have a slide in the pack, slide 35, which does address Illawarra and CapEx associated with Illawarra. We did call out FY 2023 guidance of $300 to 360 million. That's really, you know, higher rates of underground development and upgrades to coal clearance and ventilation in order to support our transition to a single longwall at Appin. That really is what we've talked multiple times about in terms of ensuring Appin can be a standalone business. You know, that will deliver, you know, cost and operational efficiencies to that business. That window of CapEx we do expect to be, you know, elevated through 2023, 2024, 2025, related specifically to Illawarra and then, you know, return to more normalized levels. Then probably, you know, the growth CapEx we did call out for 2022, the second half, for the first time, an uptick in guidance on Hermosa. That's a large portion of that relates to pre-commitment spend on dewatering in the first half. Sorry, in the second half. We'll continue as we move through the studies, study work there to provide updated guidance once we hit feasibility, decision on final investment, sorry. I think that's the key. I mean, obviously, you keep the optionality alive, you invest to create those options. Any final execution decision, whether it's on D&D, whether it's on Taylor, whether it's on rail expansion in Manganese, it's always gonna compete on a returns basis with the options we have in the portfolio. Yeah. Just on that rail expansion in Manganese, is that a meaningful kind of a potential investment or is that relatively modest? Look, I think in the scheme of things, it's probably relatively modest. I mean, there's probably two components. You know, what do you do around rail loop access to allow you to have longer trains and how you actually fill the trains. There's other options around you to go the next step to actually upgrade your infrastructure there. The team's doing some work around what the best option is to go forward on that side, but it's certainly not material capital in the scheme of things. Less than $50 million. That's fine. Yeah. I mean, certainly the rail loop would be well less than $50 million. If you decide to put two rapid load out facilities in, well, then you're probably talking around that magnitude. You know, we're a fair bit off making that decision. Okay. Thank you. Your next question comes from Brian Morgan with Morgan Stanley. Please go ahead. Hi, guys. Thanks very much for the call. Can we just go to GEMCO, if you don't mind? You're talking about doing a feasibility there on the eastern leases sometime during the course of this year, which is great. Could you just chat to us a little bit more about that? Then also, you have been doing some work on the southern leases at the same time, but it looks as though you're a little bit ahead on the eastern leases. Can you give us an indication on how the two areas compare? Have you drilled any holes or just done aeromags or what have you done so far? In particular, the way you describe that is right in a nutshell. The eastern leases is well and truly ahead, if you like, of, you know, the southern leases. It's adjacent to the current mining area. It's a relatively simple move into that area. Now, in saying that, like a move toward new areas, you've got to do the work around understanding the resource. You've got to plan out, you know, how it's actually gonna work in terms of the mine plan, stripping ratio, grades, and how you're gonna mix it with the rest of the product. That's all the things that are going on, if you like, as we do the work around this. In terms of that study, it is far more advanced than the southern leases. The southern leases have been more of an exploration, if you like, kind of project. We'll come back to a bit more detail on the eastern leases. The southern leases, there are certainly a number of drill holes that have gone in there to have an understanding of what we have. I think what we've always said about the southern leases, it's an extension to the southern piece of the island. It certainly is, if you like, it's areas that haven't really been touched before. Until we get in there and to do that drilling, we weren't quite sure exactly what we have in that space. I think the overlay, if you like, that we talk about in the southern leases, it's an ongoing discussion with the traditional owners because it tends to be more around waterways and also what they call white sand, and that tends to have more cultural significance, if you like, to the traditional owners. Working our way through that with them is really important to sort of get our mind around. To sort of give you a sense of some of the numbers when we think about the southern leases, so it's not like we haven't actually touched it. You know, it is basically, we commenced the pre-feasibility study for the southern areas in July of 2021. You know, we've done quite an extensive program now over a couple of years, and that's involved a number of different drilling approaches. We've got some more work to be actually done. We're probably about. You know, we're through that program and probably expect to complete it somewhere in 2022 calendar year. It has been impacted by some of the weather issues. It has also had some impacts, if you like, again, as we try and negotiate with the traditional owners about what we can and can't do. You know, it has a range of outcomes. Historically, we've talked about is it 2 years or is it 20 years? We just don't know till we go in there and actually do some of the drilling work. I guess now we'd moderate that around the fact that because we do think a lot of these areas are significantly culturally important to traditional owners, you're not gonna certainly get access to the full land package. We'll continue to work through them and we're doing some, you know, cultural heritage and sacred site surveys at the moment and working through that piece. The eastern leases, you know, in that space, there's maybe one little approval left to be done, but all the other approvals have been activated as of today. We expect that to tollgate probably, you know, in the last quarter of this financial year, with construction work starting at the beginning of next financial year. That's not really far away in terms of work. You know, and as we sort of finish that study, we'll talk to people about what that looks like in terms of costs and timing in a bit more detail. The eastern leases I'd see as much more of a natural progression of where we are now with some set up capital to start with. That's awesome. Then metallurgically, is the eastern lease quite a bit different from what you're doing at the moment or is it very similar? Look, I think it's roughly the same material. I mean, the thing we are generally seeing as you get further out in the ore body at GEMCO, and this is no surprise, it's still the highest grade best, if you like, deposit in the world, but you naturally are seeing some change in the grade and characteristics, but it's around the margins. What you are seeing is an increasing strip ratio, you know, as you get further out. That's been pretty well flagged since we did Strategy Day a couple of years ago, and that seems to be sort of panning out exactly as we sort of expected so far. Okay, that's good. Can I ask one more question on South Africa Manganese? You spoke about the rapid load out terminal, et cetera. Obviously we've had the difficulties with logistics with Transnet. Do you feel that you've been disadvantaged in any way in terms of getting trains by not having a rapid load out station? You know, the context there is everybody else in the industry reckons that if you've got a rapid load out terminal, you have an advantage. You can get some trains out of Transnet. Do you feel that that is that you have lost out or not yet? I mean, Noel can talk about the day-to-day, but under the current MECA 2, we have about a 2.6 million tonne allocation from memory, of which, you know, we generally will use about 2.45 of that. Some of those delays aren't driven by us, some of those are driven by them. You know, I think there's always an opportunity to improve. It's probably for MECA 3, the next contract that's gonna be more important as they expand capacity, and they look to utilize their existing infrastructure more. Maybe Noel, you can come in and make a couple of comments about that. That's exactly right, Graham, and that's the engagement with Transnet. You know, that's what they're signaling. You know, there's an advantage and there's an upside for us, you know, to get more on rail, you know, if we're more efficient. So that's what we're exploring, you know, as we're going forward. I mean, it's always a fine line. Yeah. In South Africa because the rail capacity is gonna continue to grow over time. You know, at the moment, you're probably seeing in the market, particularly in China, there's a strong premium for higher grade material that's not coming out of the Kalahari. Not all materials are the same. Our focus traditionally is to get the higher value material, if you like, on the actual train to sort of get the most manganese units out of the country. A lot of people are putting lower grade material out there. I mean, ultimately you'd like to put all your material on there. I think the one thing we've been doing in the short term is actually, you know, with some changes in personnel there, Noel, we've been actually capturing some additional capacity that's actually not in our numbers, which has been a real positive. Okay, cool. Thanks very much, guys. Once again, if you wish to ask a question, please press star one on your telephone and wait for your name to be announced. Your next question comes from Shilan Modi with HSBC. Please go ahead. Good morning, good afternoon, guys. Thanks for taking my questions. Congrats on the strong set of numbers today. You know, given the acquisition of Sierra Gorda, can you give us just an update in terms of what's required before it closes out? I know in the guidance you said, you know, probably closing in February. Is there a ramp up or is the mine kind of at steady state currently? We're just trying to get a feel for volumes, just compared to like some of the industry data I've seen. Then given that and the level of debt you're gonna have, how should we be thinking about your dividend payout ratio for the next year or two, while your debt is a bit elevated? I may follow up with one question on manganese. Yeah. I'll get Katie to talk about payout ratio and, you know, the dividend payout ratio and what capital it looks like for Sierra Gorda at a high level, and the balance sheet. What I would say from the closing of the transactions, probably the big milestones were, A, KGHM, you know, not exercising their preemptive rights, which they didn't, and gave us notice. We had a number of competition approvals that we needed, which, you know, they included the Chinese, European, Turkey and Brazil. Those competition clearances, you know, are not always within your control, but they've all been finalized, and we have those. The way I think about it now is us just moving through the procedural aspects of closing this deal, which has, you know, had a couple of overlaps with public holidays in Chile, banking holiday in the U.S. on Monday, and one in Japan on Tuesday. We're not far away from completing this, and it's very much just procedural items left. In terms of operating costs, unit cost guidance, you know, production rates, where we see the value, the best, you know, look back is still on the actual presentation that we actually provided to people when we did the acquisition. You know, I'd always come back to that piece that we do see. You know, obviously where we are today in the Catabela pit, they're in the process of actually doing a debottlenecking project, and that is progressing to plan. You know, there's obviously the ability for an oxide opportunity there. There's also a broader land expansion, if you like, exploration opportunity. At the same time, you know, there's a lot of, if you like, improvement opportunities that we see within that business. When we actually announce the, you know, the completion of the deal, we'll give our specific guidance for this year. I would say if you look back at our investor pack, there hasn't been really material deviations from that. You know, what we are doing at the moment, as you'd expect, as we get close to being in the chair, we're starting to participate in some of the various meetings around technical leading owners council to sort of understand how things are working, but also have our key people ready to go. Because the point of the attractiveness of this for us is obviously KGHM, you know, our partners working closely with them on this because we both have joint control. But we have a lot of confidence in the management team they have on the ground there. Katie, you wanna talk about maybe the balance sheet implications and cash flow? Sure. Look, I mean, I guess probably just to start with our capital management framework, that is unchanged, so you shouldn't expect to see us behave any differently than we have over the last sort of 7 years in relation to how we manage our balance sheet. We do believe in, you know, that strong, investment grade balance sheet through the cycle. In terms of the ordinary dividend, we have a minimum payout ratio policy of 40% of underlying earnings. Today's announcement, we did announce a $405 million dividend, which was $0.087 per share. That's a record dividend for us. The way that policy is designed is to flex effectively with our earnings. It protects our balance sheet in the downside, but shareholders receive the benefits in the upside, and that's what we're seeing today with the record dividend. I think, look, the other objective that we have is, as we think about returns to shareholders, we have also announced today, an upsize in our capital management program of $110 million. That brings us to $302 million outstanding on that program. We do intend to continue to execute the return of that through the on-market share buyback that we have in place. You know, as always, we will continue to assess whether we have excess cash available to return to shareholders, and we'll look to do that in the most efficient manner possible. If you think about our cumulative returns to shareholders to date, we've actually returned 83% of underlying earnings to shareholders since we started at South32. Our share buyback has been, you know, very effective in terms of, you know, we've bought back at an average of $2.88 a share, and we've managed to cancel 13% of our shares on issue. That program, we believe in longevity of that program, and we look to buy through the cycle. You would expect us to continue to assess, you know, our capacity to return excess cash to shareholders in the same manner. In terms of the payment for Sierra Gorda, if you look at our pro forma net debt, we did provide a slide 18 in the deck that shows, you know, effective at the end of January on a pro forma basis, we'd be at $439 million net debt. If you add to that, our capital management program outstanding, our dividend that's due for payment, the potential completion of the acquisition of an upsize share in Mozal, that brings us to a net debt on a pro forma basis of about $1.3 billion. You would expect us to recover that to more normalized levels as we move forward, so that we can return strength back to the balance sheet and remain cycle proof. Should we be thinking more about further buybacks? After the debt kind of reduce post-acquisition, should we be thinking about further buybacks or maybe a potential enhanced dividend? I'm just trying to get a feel for where the capital flows will go. Yeah. The manganese question I wanted to ask is, you know, some of your neighbors in the Kalahari have capacity in terms of rapid load up facilities. Is there potential to do some sort of JV with them to get access to the infrastructure, potentially unlock some synergies between your pits and theirs at Mamatwan? Thanks. Yeah. Maybe just to close out the dividend one then. Look, our policy is a minimum of 40% of underlying earnings. I don't expect that we should see any change to that. That's a core tenet of our capital management framework. It is intended to flex with our earnings, so we don't see a need to change that number. But as I said, look, we've got a capital management program that's been in place since 2017. That program, you know, we can continue to assess our capacity to have excess capital, and we return that excess capital to shareholders in the, you know, how we see the most efficient manner, whether that's by a special dividend or via an on-market share buyback. Certainly at the moment, we still see value in our shares, so we do believe that the buyback is the most appropriate form of returning our current outstanding balance of $302 million. Thanks. In terms of manganese, look, I think Mamatwan, CB clearly are the ones that have some synergies. We've been working the Barrier Pillar together over a number of years, and we both get some benefits out of that. I think there are opportunities to look at how we share rail infrastructure. I think historically, because of lack of investment in this business from previous ownership, we are probably one of the few producers that don't have a rapid train load out facility. So that's either the decision we've got to make or how we share infrastructure. I think the other thing we're doing, if you like, at South Africa Manganese, is actually looking at the ability to actually expand the Wessels mine. In particular, if you believe where the world's going for higher quality material, there's a potential there to actually substantially increase production. That project's currently in pre-feasibility study that we're working through at the moment. I think rail allocation, rapid train load out, potential size of vessels all go together. Obviously, we're exploring opportunities to share synergies between ourselves and the other producers in the meantime. I should sort of comment, phase I of, if you like, what we could do on the rail, again, is around what we do with the railway loop and the extension. That isn't relatively capital intensive. It's the next stage, you'd have to really think about the train load out facility. Thanks very much. Your next question comes from Myles Allsop with UBS. Please go ahead. Thanks. Just a couple of things just to follow up on. One was, you know, Rio's cultural report obviously made some fairly scary reading. Just, you know, could you kind of, you know, say how you've looked to your own culture in light of that report and what potential issues and improvements you can sort of apply or take from it. Then just also a little bit more clarity on Illawarra and when we'll get more kind of a better sense as to, you know, how the mine will be developed and whether it's gonna be core or non-core in the future. Thank you. Yeah. Maybe you know, the culture piece coming out of Rio. I guess the way I think about that is not something that sort of triggered us to start a piece of work. It's a piece of work we've had underway for a period of time. You know, for us, if you think about sexual harassment and bullying, that is, for us, physical as well as psychological safety. Probably about 18 months ago, we put together a team that sort of looked at how do we take our diversity inclusiveness to the next level and allow people to bring their whole selves to work. We also did a piece of work across our operations around physical safety and security way before that report, which resulted in upgrading of security, lighting, locks, how we work and things like that. That's been in place. You know, when the Rio Tinto report came out, you know, obviously, as you'd expect, we had a look at it, you know, are there any major gaps in the work that we're doing? Is there anything we can sort of learn from? I think I'd say there wasn't anything that we thought we should be doing that we're not doing, and you know, that's a good idea. I think what I would say is the Rio Tinto report, if we did a similar report, if most mining companies did a similar report, I would say that our industry probably represents society. In society you will see a range of elements around harassment, bullying that are real. You know, they do exist. I know in our business we have, you know, reporting all the time. We have action taken all the time. The only way you drive it out is through leadership. I think in terms of some of the comments around, you know, I won't comment specifically on Rio Tinto because they're better placed to do that. You know, we do a lot of work, for example, around our own surveys, which we call Your Voice. Personally I do twice a year an exercise called the Leadership Shadow, where you cut across parts of your organization to see, you know, what impact you have on people. Not me doing it, but other people do it on my behalf. I think we've got a fair few of those tools in place. I think it was brave of Rio to put out the report, and it gives them a good baseline how they can improve. Again, I'd say all industries have some of those challenges. The other question was around Illawarra. Yeah ... that's into a couple of components. You know, Katie spoke about the call out of the capital, in particular for Appin. When you think about Appin, the plan that we spoke about, you know, a while ago now, and that plan was really how do we actually sort of position ourselves, you know, for the future at Appin, and in particular, when I say to get ourselves ready for the future of Appin, it was really about, you know, how do we make Appin potentially stand alone in its own right so we can actually not be dependent on the Dendrobium approval process. From that perspective, you know, we talked about obviously going back to a dual Longwall operation in April 2022, which we achieved, and that allowed us to deliver higher volumes across the complex in 2021. In August 2021, we talked about the move of Appin to a single Longwall operation from FY 2025. With that, you know, move to single panels, it brings further capital and operating cost efficiencies. Some of the examples there, obviously you've got longer Longwall lengths, hence you're reducing the number of Longwall moves. You've got reduced delay times around the moves. You also take away some of the sustaining capital around development, about 30 kilometers west over 18 months. You go from four to two bench shafts, seven to four continuous miners, 12 to four gas drainage rigs. That plan is in process and being executed. When Katie talked about that uplifting capital, if you like, of $300 to $360 in FY 2023, that really is around two bench shafts. It's around coal clearance and it's around a new set of shields and the new next piece of the longwall. That really allows you to position Appin to run for current approvals that run up to about 2040. That certainly puts it in a better position to be as, you know, a mine that's sustainable through the cycle. I think the unknown is Dendrobium. If you think about our, you know, what we did talk to is obviously the drop-off in production that basically occurs where we've actually got a decline to about 5.5 million tons in FY 2024 across the complex. Really the bigger driver there is by two things. Both related to Dendrobium. One is the drop in tonnage as we set up a Longwall in a new area, and that's as we move into area 3C. The second component is area 3C is gassier than the previous areas in Dendrobium. It's CO2, not methane. We certainly have a small block of area where we've got to manage our way through that gas, which sort of results in gas drainage, lower productivity rates until we move to the next domain, which would be area five, which is what the D&D Adapt project is all about. You know, the D&D Adapt project, we're in the process of getting ready to finalize our submission this quarter. That's our EIS submission this quarter. Obviously then we'll go through the process of public commentary, and then we'll move through the state approvals and federal approvals. Ideally, we'd like to complete that federal and state approvals by the end of this calendar year. I guess what we are seeing, the approval of coal projects in Australia, as you know, sort of shown by the IPC decision, has had certainly some unusual twists along the way. We do believe that the D&D Adapt Project has done enough work to distinguish itself from the previous D&D expansion project. You know, it's concentrating more on the higher grade material. It has a lot less in terms of impact, if you like, across the entire complex. It addresses some of the issues or most of all the issues that were raised by the IPC. We feel it's in a really strong position to go forward, but it needs to go through that EIS process now. Obviously based on the feedback, we'll be in a position at the end of that to sort of incorporate the feedback we think it's appropriate. You're in a position where you want to evaluate it as an investment decision you wanna make. It's gonna be very dependent, if you like, on how we go through that process. I think what is critical is preserving the optionality at Dendrobium until we actually have that decision. There are no further questions at this time. I'll now hand back for closing remarks. Thank you. Thanks everyone for participating today. Just a couple of last key messages to leave you with. One is, look, we recorded a strong H1 FY 2022 result. Had record operating margin of 44%. You know, record return on invested capital. You know, record, if you like, dividends. To be very clear, while we benefit from higher prices, I think we've also benefited strongly from the divestment of those lower returning businesses that we've spoken about before. That's South Africa Energy Coal, TEMCO, and Metalloys. At the same time, I think the team has done a good job holding increases in controllable costs to less than 3% of the cost base. At the same time, as I mentioned, we've not only taken the low value, you know, low margin businesses out of South32, we've also brought in a number of options to grow the business. Sierra Gorda will complete in February. We've obviously doubled our green aluminum production through the Mozal acquisition and the Brazil Alumina aluminum restart. At the same time, we've got high returning improvement projects at Cerro, Cannington and Mozal in execution. We've just spoken to the market about Taylor being the first stage development of Hermosa, with Clark, Peak and Flux yet to come. I think at the same time, you know, what has remained the same is our unchanged approach to our capital management framework, which as you see now, is still working as it's designed to. It's rewarding shareholders as our financial performance improves. I did want to thank you for your support and time today, and we'll talk to you soon. Thanks, everyone. That concludes our conference for today. Thank you for participating. You may now disconnect.