Thank you for standing by, and welcome to the Sandfire Resources December 2021 half-year results presentation. All participants are in a 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. Nicholas Read. Please go ahead. Thanks very much, Melanie. On behalf of Sandfire, a very warm welcome to everyone, and thank you for your time today on this final day of reporting season. It's my great pleasure to introduce today's investor call and webcast on Sandfire's financial results for the six months to 31 December 2021. Reflecting the significant changes which have occurred in Sandfire's business over the past six months, today, I'm introducing the senior executive team from different locations around the world. Firstly, in Miami, Florida, we have Sandfire's Managing Director and CEO, Karl Simich, and Head of Investor Relations, Ben Crowley, who are attending the BMO Global Metals & Mining Conference. Secondly, from the MATSA operations in southwestern Spain, we have the company's Chief Operating Officer, Jason Grace. Finally, here in Sandfire's Perth head office, we have the company's Chief Financial Officer, Matt Fitzgerald, and David Wilson, Head of Technical Services and Business Development. The order of proceedings today, Karl, Jason, and Matt will firstly run through the December 2021 half-year financial results presentation, which is available on the ASX platform and as a synchronized slideshow via the BRR Media service using the link on the front of the presentation. When we get to question time, Karl will hand over to Melanie from Chorus Call, and we'll deal with telephone questions first. In the interest of efficiency, and given everyone's location, I will direct questions appropriately as we move through the question queue. Once we've completed the telephone questions, I will deal with any online questions submitted via the webcast browser before handing back to Karl for closing remarks. A recording of the entire webcast will be available following the conclusion of the call. Those preliminary logistical remarks out of the way, it's now my pleasure to hand over to Karl over in Florida to introduce today's presentation. Karl, please go ahead. Thank you very much, Nicholas, and welcome everyone to the call. I look forward to presenting the half-year results and other key matters that have been occurring in the business over the last six months. It's a great pleasure to be talking to you today. In terms of the business and Sandfire and where we operate, clearly over the last period of time, we have been doing a lot of work to progress our strategy and to find ourselves now very much in a transformational stage of our business. We have had the last six months of excellent operating performance, just continuing excellent performance from DeGrussa, aggressively moving forward in the development of the Motheo project in Botswana. As mentioned, where Jason Grace is located at the moment, the acquisition of the transformational transaction to acquire the MATSA complex in Spain. We continue with an extraordinary strong push in terms of the key element of our business, our organic exploration globally. In terms of strategy, you know, we are well and truly, you know, continuing to move forward and execute our business, based on the strategic plan that we set out some two years ago and continuing to, one, execute delivery. Continue to sustain and grow our production profile, certainly through the acquisition of MATSA. Aggressively moving to accelerate discovery. We have a very substantial exploration budget on foot, in Western Australia, in Spain, in Botswana, and also, we're exploring for the first time now in Montana, U.S.A. We ensure on the strategy that all of our people around the globe are aligned and empowered and have all the resources and tools that they need to execute their work. As well, from a business perspective, ensure that we are optimizing our capital structure in terms of debt and equity and engagement. Our values as a business are absolutely core. They really are the D&A behind the business, and they drive our behaviors and allow us to bring our international operations together to drive value through growth. What is critical to us is honesty, respect, collaboration, accountability, and ultimately also performance. In terms of headline results for the half year, and I'll just bring to your attention that we have changed our reporting currency into U.S. dollars. Everything we're quoting today will be in U.S. dollars, other than one item, being the dividend. Its sales performance for the half year, once again, an outstanding result of almost $312 million on a very strong EBITDA for the half year of $161 million. This resulted in a net profit attributable to the equity holders after tax of $55 million. Very strong performance for the period. Very strong cash flow of almost $200 million from operating activities. As well, just to mention, after raising a substantial amount of equity, Matt will go through the detail in due course regarding the finances of the business over the last six months, but certainly up until where we sit today, we still sit at the end of after the MATSA transaction has been completed, with $321 million in the bank. We've drawn facilities, but we're in a very strong financial position on the balance sheet. In terms of key operating highlights for the six months, outstanding results once again from DeGrussa at nearly 35,000 tons of copper production and over 16,000 ounces of gold in the period. It's still in all circumstances considered, with various input cost pressures, a pleasing C1 operating cost of $1.10 per pound. Clearly, as we know, the copper price is at $4, almost mid-$4 a pound, it provides for some very good margins. Production guidance for DeGrussa for the period will be at the higher end of guidance of 64,000-68,000 tons of copper and 30,000-34,000 ounces of gold for the year. Cost guidance for DeGrussa still remains at $110-$120 for the half year. In relation to other key elements, you know, we're pushing very hard on the MATSA copper mine and its construction. A substantial number of people on the ground, and in fact, well over 1,000 at the moment. New mining equipment, they're arriving on site, they're being assembled. Everything on site is brand new, world-class, state-of-the-art, so there will be no shortcuts taken there, and progress is really quite excellent. Feasibility study for the expanded operation will be completed in June. It's a fait accompli as far as we're concerned in terms of what the results of that will be, and effectively, where we sit at the moment, we are driving hard as we speak to proceed to a construction of a 5.2 million ton per annum operations. We also have somewhere in the order of 12 drill rigs on the ground in Botswana, and we will significantly pushing hard in terms of that continuation of organic exploration. We do believe that province and that substantial footprint that we've got in Botswana will yield other significant results and probably far more significant than we've seen to date. Just touching, during the half year, we entered into the agreement for the acquisition of MATSA. That was completed on the first of February, and we have done an extraordinary amount of work, which the team will go through the balance of this call, in terms of integration and pre-planning for that transaction to complete. Very happy to say that we've put an enormous amount of effort in for its smooth completion and also a very engaged implementation of that into our business. I must say that is going very well. We're putting a huge amount of effort in to making sure that it's a smooth transition and a smooth integration. It is a world-class asset without a question of doubt. Three underground mines, a very solid processing facility, and we just need to make sure that we optimize that operationally, and Jason will touch on that. Also, we believe, with the limited amount of exploration that's occurred in the Iberian Pyrite Belt that is under our control now, there is exceptional exploration opportunities, and we'll be spending heavily on exploration to look at, you know, greater high-quality grade opportunities, and also mine life extensions potentially out of there. What I would say is that, you know, where we sit at the moment, Sandfire is in command of two world-class mineral belts, particularly for, you know, base metals and for copper, in the Kalahari Copper Belt in Botswana and also in the Iberian Pyrite Belt in Spain and Portugal. We're in a wonderful position to leverage off those situations. I look forward to getting a reward for that, the value inside the business as we continue to disseminate that information and deliver on our strategy. I'll just pass over now to Matt Fitzgerald. Thanks, Karl. Starting with DeGrussa, clearly, it's driving, as Karl mentioned, our P&L results for the half year. We'll step through firstly starting with DeGrussa physicals, and really just to recap some of the half- year physicals that we disclosed in the December quarterly. $1.10 C1 costs, impacted predominantly by energy and shipping and port costs, and to the full-year guidance, $1.10-$1.20. Very solid half-year performance, around 3/4 of ore coming from DeGrussa, just over 1/4 of ore coming from Monty, and some very solid throughput, mill throughput rates just above 1.6 million tons on an annualized basis. Looking at how that translated through to segment EBITDA contribution. As you can see, the DeGrussa EBITDA around 65% EBITDA margin against a headline revenue of $312 million of revenue. Our other segments as we report them, we expense exploration and studies up to the point of definition. Definitive feasibility, Black Butte and Mataojo are both negatively impact group EBITDA in terms of the feasibility studies, drilling and permitting costs. Exploration, of course, as we know, across the different areas of our business. We are strong believers in exploration and its value opportunities, and there's also some costs in there in terms of $4.6 million of the 26.9 relates to MATSA's acquisition costs incurred up to the end of December. On a group basis, $161 million group EBITDA coming off a base of $204 million from DeGrussa. Moving now to a period-on-period group EBITDA comparison, f rom $138 million of U.S. EBITDA in the corresponding prior period, EBITDA for this period is some $23 million higher than that. Just broken that out into a waterfall. That strong production and copper price from DeGrussa has of course led that strong EBITDA result, as we talked about on the previous slide, and particularly sales price and some volume contributing just under $55 million directly to a comparative EBITDA number. On the negative side, as we guided and have guided through the couple of quarters, September and December, are really being impacted by freight costs. Global freight rates, not surprisingly for all, I'm sure, are significantly higher than they've been in prior periods and have come off historical lows really over the last three or four years. This is really the flip side of that. Also port congestion and costs associated with that have impacted us during this half year. Really across the page, only some minor movements up to the right, and then that $4.6 million to the P&L that we see from the MATSA acquisition costs. I'll talk about that a little bit more when we get to the MATSA slides as well. For an EBITDA for the group, $161 million. Moving across to financial position, we have a very strong balance sheet. It is strengthened of course somewhat by the equity raising, and the monies held and funds held at the end of December in preparation for the end of January MATSA acquisition, so c ertainly very cash heavy. Looking at that, we've also added some detail across, and I'll get to it in the waterfall in a minute, some detail across some of the other movements in cash. Also just to recap that during that period, $145 million, it is denominated in Australian dollars as a facility, but we're stating it here in U.S. dollars. $145 million or AUD 200 million drawn down during the period also in preparation for the MATSA acquisition. That has allowed us to come off what was previously a debt-free balance sheet, excluding lease liabilities, and really allows us, as Karl mentioned, to leverage our balance sheet into being able to take something as impressive as an operation as MATSA into the group. Post balance date, in terms of balance sheet, we took on, as everyone I'm sure is aware, $650 million MATSA acquisition facility, which is drawn in Spain and is separate to the parent. It is effectively ring-fenced at the MATSA level. Moving to the cash flow waterfall for the half and really breaking into a couple of sections, starting at $431 million dollars at the open starting position at the start of July, y ou'll notice that there's the operating cash flow, $193 million positive, and then really the rest which relates predominantly to DeGrussa income tax and also the full-year dividend. Moving to the right, there's a section between equity raising, ANZ corporate facility and MATSA deposits, which is really prior cash flow movement up to the end of December, and they are those three items, all MATSA acquisition related. Up prior to that point, prior to the equity raising, you can see $887 million. Up to that point, our cash would have been at that time around $469 million. Those MATSA related cash flows of course happened up to where you can see closing cash 31 December 2021 of the $1.2 billion. The MATSA transaction itself, so the $650 million drawdown of debt on a gross basis and then the actual MATSA acquisition of $1.565, which in addition to the $300 million deposit paid prior to 31 December, makes up the headline $1.865 billion acquisition price for MATSA. Tacking onto that, some cash flow for January, partly due to a prepaid sale in December that related to a January shipment. In net cash and also with CapEx at Motheo, there's a net cash drop of $15 million to get us to end of January or 1st of February position, if you like. $271 million in terms of the waterfall, and then tacking onto that $50 million, which was the cash acquired on the acquisition date of MATSA. As of 1 February 2022, $321 million of cash holdings. Moving now to dividends, we're very pleased to continue our strong record of returns to shareholders. We have acquired in MATSA a cash-generating asset. It's also a low CapEx asset in terms of upfront CapEx. It has, of course, mine development and ongoing, and a fairly low burn rate of sustaining CapEx levels. We of course have Botswana lining up well in terms of we're funding it from our balance sheet, and then from around mid-calendar year, we expect to be finalizing the debt facilities for around $160 million of debt financing into Motheo. Very much a period of change for Sandfire, but very, very pleased to have on an interim basis to declare a strong dividend and continue that strong record of return to shareholders. AUD 0.03 per share Australian dividend for the interim period. As I said, fully franked and the record date 16th of March, payment date 30th March. We are, of course, as Karl mentioned, very, very closely optimizing and watching our capital structures as we go. We have taken some debt, of course, and some leverage onto the balance sheet, which we believe is very, very manageable, based on the quality of the cash-generating assets that we hold. Future dividends, of course, will come out, as the board determines in the future. But as I say, we'll balance our project development, funding mix, exploration, and growth. Then as we move into, again, a more sort of, I guess, stable operating environment in terms of having at least two producing and cash flow generating assets, the board will of course revisit our dividends position over time. Moving across to our new operation at MATSA, w e'll cover this in three parts between Jason and myself. Firstly, the transaction, then a bit of a discussion around optimization, pre and post, the transaction date, and then finally into guidance for this sort of interim five-month period up until the end of the financial year and the point where we'll then be issuing MATSA guidance in line with group guidance. Firstly, to the acquisition, just a bit of a recap on some of these items, of course, well-known, and we've put out announcements covering these, most of these details before. Those are the transaction completed on 1st of February with equity, the MATSA debt corporate facility, and also our build of cash holdings, which really came from the DeGrussa operations over the last couple of years. The debt-free DeGrussa operation certainly helped in being able to leverage our balance sheet. The financing facility for MATSA at $650 million is a five-year facility. We have completed the syndication of banks, and we have a very high quality collection of international banks, both through Europe and very pleasingly, specifically in Spain. Some very strong support from Spanish banks, but also U.S. banks, Australian banks, and other European banks. We're very pleased with the quality of that banking group, and we look forward to working with them on the success of MATSA over time, and Sandfire Resources more broadly. Laid out the finalized repayment profile. The first repayment, $118 million for that facility due at the end of September this year, and $198 million scheduled for the financial year of 2023 in total. We'll provide more detail around these as we go. This is just in financial years. Generally speaking, there's payments around July and January of each year as we roll through the repayment schedule. Hedging also, as previously advised, hedging is in place across three years of copper and zinc for MATSA, just under 74,000 tons of copper at $4.19. Starts in the 2022 year, so in the next five months, around $4.32, and by the time we get out to financial year 2025 and it's $4.04. Zinc, just over 84,000 tons of zinc forwards. That also has a range starting around $1.46 in the financial 2022 year, and sliding on a sliding scale down to $1.13 in the 2025. What is picked up in the 2025 financial year. There's three complete calendar years of hedging between February of this year and February in three years' time and January in three years' time. Now, there's more detail for that for anyone who needs it in the completion announcement that we put out on the first of February this year. All right. If we now look at MATSA optimization, o perational integration is now well underway with the Sandfire integration team on site and working very well with the Sandfire and MATSA team. Initial work for integration extends across the key areas of operational excellence, alignment of policies and standards, and reporting systems and governance. Near-term key projects have focused on the period to June 2022, and supporting the issuing of interim guidance as Matt touched on before, for the remainder of this financial year. The key work in this area has included the confirmation of near-term operational plans and budgets, review and commencement of updates of mineral resources, which in turn will support updates of the life of mine plan and ore reserves. Significant work on plant readiness, recovery, and concentrate product optimization, and mining production and delivery. Looking out longer term, and following the completion of this initial important work, we expect to issue financial year 2023 guidance in the middle of this calendar year. At the same time, continuing to establish a strong base at MATSA for multi-decade operations that will be underpinned by a strong safety culture at MATSA, alignment with Sandfire's values, an in-depth understanding of the key drivers of value and a commitment to operational excellence. A focus on ongoing growth of mineral resources and ore reserves, and in line with Sandfire's D&A as an explorer, a commitment to long-term investment in exploration right across the Iberian Pyrite Belt. Circling back to the current financial year and looking at MATSA interim guidance, we are very pleased to be able to issue production guidance for the five months to June 2022. This includes approximately 26,000 tons of copper, approximately 37,000 tons of zinc, approximately 1,000 tons of lead, and approximately 820,000 ounces of silver. Please note that we've also included guidance on the payable percentages for all elements. Finally, noting the complexity associated with the production of both copper ore and polymetallic ore across the mining operation, we have included a breakdown of production tons and grade for each of three underground mines. When combined, the guidance is copper ore production of approximately 450,000 tons at a grade of 1.8% copper, and polymetallic ore production of approximately 1.45 million tons at a grade of 1.9% copper and 3.4% zinc. With total production expected to be approximately 1.9 million tons for the period. Now moving to base metals concentrate production guidance, w e note that MATSA produces four concentrate products. That includes a cupriferous copper concentrate, a polymetallic copper concentrate, a zinc concentrate, and a lead concentrate. You will note the breakdown of expected concentrate production and grades for each of these products, with the combined concentrate production expected to total between 200,000 and 220,000 tons for the period. The expected revenue split is also shown, and unsurprisingly, the lion's share of value is driven by copper and zinc. Looking now at MATSA, our unit cost guidance, and as we mentioned before, strong margins have commenced from day one of ownership. At an indicative level, around $3.40 per pound of copper direct margin against C1 pre-development CapEx. Headline C1 costs for the five months, we expect to land around $0.94 per pound, and they are higher driven by global cost pressures. Just to point out one of those, from around mid last year up until now, on a processing basis, costs are up around $0.25 per pound. I'm guessing no surprise to anyone around higher energy costs and global inflation, which includes labor inflation, costs and pressures in Europe. Certainly, on a margin basis, much stronger than any of our prior analysis that we had worked through. Group guidance, combining the two together, DeGrussa across the 12 months of the financial year and MATSA for the guidance that we've just put out today in terms of five months to June 2022 and pulling them together. We're approaching 200 million pounds of copper production for the full year. We're guiding for the second half costs. The second half combining DeGrussa and MATSA together of around $1.05-$1.15. The midpoint of that is around the same number as we looked around the first half, which was just DeGrussa. Similar second half to the first half. Acquisition costs, importantly, total around $50 million. Around a third of that we expect to finally go through the P&L for the full financial year, so around $17 million to the P&L. Around two-thirds of that $50 million of that, of MATSA transaction acquisition costs go to the balance sheet against the debt and equity numbers. Headline production, 90,000-95,000 tons of copper and then around from MATSA. That will be combined, MATSA and DeGrussa, and then just from MATSA is the zinc and lead numbers shown there, and also the silver numbers, and then DeGrussa contributing on the gold side, 30,000-34,000 ounces of gold expected for the full year. CapEx across DeGrussa and MATSA, around $80 million in terms of mine development. For the full year, around $145 million expected, and we'll get to that in a minute around Motheo, around $145 million for the full year, and around $17 million in the group, as quite a low sustaining CapEx type burn rate. Exploration, evaluation and studies, to wrap those together, around $55 million expected for the group for the full financial year. If we now move to the Kalahari region and in particular, the development of the Motheo copper mine. With reference to our recent pictorial update released to the market on the 14th of February, we're very pleased to advise that construction and development continue to proceed on schedule and on budget, with first production expected in the first half of calendar year 2023. Some of the key recent developments for the project include a substantial ramp-up of the on-site workforce to now be well over 1,000 people. Significant progress with the development of access roads to the Motheo site. Pouring of the foundations for the crusher, the reclaim tunnel, and mill, with over 1,500 cubic meters of concrete poured to date. Construction of the 750-room permanent accommodation facility is now advancing well. The mining contractor has also mobilized to site and constructing key facilities and assembling mining equipment. Foundations for the 132 kV power line have also commenced. Finally, the mine operations team continues to build up in preparation for the commencement of mining. In addition to this, Sandfire intends to fund the development of the Motheo copper mine through a combination of cash and project debt. Credit committee-approved offers for debt financing of the $160 million required for base case development have now been received from the company's shortlist of potential international lenders. The selection of the syndicate of banks and finalization of terms will be completed in the coming weeks. If we now look at the development timelines for Motheo, construction of the permanent accommodation facility, power infrastructure, and process plant will continue into the next quarter. With the next key project milestones coming in over the coming period being the commencement of pre-strip mining at the T3 open pit in April and also the commissioning of the permanent accommodation facility in June. Finally, moving on to an update on the Motheo mine construction and development capital. Given the substantial ramp-up in activity in recent months and with pre-strip mining operations to begin early in the next quarter, we're entering the phase of the project where we will be executing across all areas. As a consequence, we'll also be entering the peak spend phase of the project, which is forecast to extend over the next three quarters. The graph shown provides a breakdown of spending in all key areas of the project for each quarterly period. It should be noted that the costs shown relate to the 3.2 million ton per annum T3-only base case, which totals $319 million. We are continuing to move forward with the 5.2 million ton per annum expansion feasibility study, which is expected to add approximately $47 million in capital costs, but also substantially increasing the overall value of the project. Karl, have we got Karl on the line just to wrap up? Sorry. Just key takeaways for where we are at the moment. Clearly, look, we've been doing a lot of work, and it's been a very busy six months for us. We continue to deliver on all elements of our strategy. We have continued to be well and truly on piece, and our team, our global team is delivering results that really are into this global-based metals sustainable mining company. It's a wonderful scenario that we see. Very strong cash flow platform. The cash flow platform is working off. We continue to look for great opportunities around the globe. We're not constrained by that. We're very excited about what's happening in Botswana and that production hub and the opportunity for great further expansion in that part of the world having effectively you know controlling that Kalahari Copper Belt and a copper belt that has got an accelerating rate of discovery. And with a strong pipeline with the acquisition of MATSA into our business and a very long life and potential to extend that substantially puts us in a very good position. We are very excited. The team is very refreshed. The team is very focused. The team's working very hard, and we're very excited about what we can achieve over the next period of time. With that, we're going to call the conference to a close, and we're going to open the floor to questions. I thank you very much for your attendance and your listening today. I think we're in a wonderful position to springboard and transform and transition this business over the next many decades to come. Thank you very much for listening, and the floor is now open to questions. Your first question comes from Rahul Anand with Morgan Stanley. Please go ahead. H i, Karl, Jason, Matt. Thanks for the opportunity. Two questions from me. First one's on MATSA. Look, if I take the five-month production guidance and then annualize the number, it drops out at circa 10% below the presentation at the time of the acquisition. Am I thinking about this number correctly? I mean, your byproduct credit estimates for commodity prices are also higher, so I would have thought there's probably a positive impact from that on a copper equivalent basis. So just if you can talk to that a bit and how we should be thinking about production and grades sort of progressing forward and what's changed from the time of the presentation in terms of the production side. That's the first one. Thanks. Thanks very much, Rahul. We're going to throw that one over to Jason in Spain. Jason, please go ahead. Thanks, Nicholas. Rahul, you're absolutely right. Annualized, we certainly land at that number there as well. What has happened since the transaction is obviously there's been a lot of movement in pricing over there. What we have seen for the team over here in Spain is that they have been doing some more work on particularly optimizing and using an NSR cutoff for mine planning. What we've seen for that, it has brought in some lower grade material into the mining inventory. We've gone forward on that basis for the five months until we can get through and do a lot of work to actually optimize the longer-term mine plan. Overall, the metal's all still there. The grade is all still there. What we need to do over the next five months is really optimize that mine plan and make sure that we're doing the best thing for the asset going forward. Okay, just one quick follow-up there. In terms of the cost impacts then, is it fair to say that the cost differentials from the time of the acquisition to now are broadly all related to this change in terms of that grade profile and NSR cutoff? Or are you seeing some other material increases in terms of your cost base as well? Thanks, Rahul. Keep going. We're going to throw that one to Matt Fitzgerald. No, I'll have a first go at that one, Rahul. Certainly partly because of the product mix, and as Jason mentioned, you're talking about a five-month period, which is really our sort of interim, almost gap guidance, before we make some changes and see some of those programs sort of come to fruition. I would comment on costs. There are global cost pressures, as I'm sure we're all aware. There are pressures on energy costs and inflationary pressures. Yes, there is underlying period-on-period cost increases. I would also point out that C1, particularly the headline level, C1, is and will be very sensitive, of course, to not only headline costs, but also to the balance between copper and zinc production and also the relative pricing between copper and zinc production for that byproduct credit. It's quite a material byproduct credit at, you know, $0.72, compared to a copper price of $4.34. Some multiple factors that impact that. I would certainly say partly cost and partly production mix. Okay, perfect. Look, second one is a quick one. 35% NPAT payout is a policy for the dividend. Is that something you want to continue going forward? Obviously, net debt on the balance sheet now, and also you've got some project builds going on and perhaps a bit of CapEx coming up at MATSA, if you do choose to expand there. Is there an ability here to reset that dividend to a level, perhaps that protects the balance sheet a bit more? Are you happy with that 35% NPAT? Try that to Matt Fitzgerald. Yeah. Thanks, Rahul. Really the 35% is what we're sort of been doing over history. We certainly don't have a formal policy in terms of dividend policy, but we've been very proud to be able to pay that sort of level out. Really, the dividend concept here is a little bit like the production guidance concept. It's a little bit of an interim period, a holding pattern for the next few months. As I've mentioned before, we have taken on more debt, but we do have two operations that are producing significant cash flow. The Executive team, the Board, will think towards that, probably the middle of this calendar year and into the next financial year around setting, almost resetting in some ways, some of that. But I certainly wouldn't take it as a major signal for or against our 35% payout ratio. I think we're just in a transitional time for the business. We've declared that as an interim dividend on this basis, and we'll reconsider as we go. Perfect. That's my two. Thank you very much. I'll pass it on. Thank you. Your next question comes from James Redfern with Bank of America. Please go ahead. H i, Karl and team. Two questions, please. The first one is just in relation to the power supply agreements for MATSA. Just wondering if you'd please disclose what proportion of electricity is purchased under long-term contracts versus on a spot basis from the grid? I've got one more, please. Thank you. Thanks, James. We're going to pass that one to David Wilson here in Perth. Yeah. Thanks, James. Look, presently, MATSA's power is purchased under contract from the Endesa, I think they're called, the local state utility over there. It's currently at spot price. Certainly, some of the things we'll be looking at going forward is what's the right strategy there. I will note, though, that the MATSA team already have in place some other projects to diversify supply, I guess, by installing solar farms and the like, currently due to come in first half of calendar year 2023. The MATSA team are working very hard to bring that forward as much as we can. Hopefully that answers your question. Certainly we'll focus there to really get a handle on that and the exposure. Just confirming, 100% spot at the moment until 2023? Yeah. Okay. Thanks. Great. Thank you. Second question is just in relation to the resource-to-reserve conversion. MATSA mine life is six years based on reserves and 12 years including resources, which is not new news. I'm just sort of wondering what are the steps to convert these resources into reserves. I mean, obviously reserves are, you know, they're the ore which is, you know, economic at current prices. I'm just sort of wondering how you see that playing out. I mean, should we expect a large degree of exploration drilling to, you know, take place in the next couple of years to convert those resources to reserves or are there some other factors at play? Thank you. Thanks, James. We're going to take that one over to Jason in Spain. Please go ahead, Jason. All right. Thanks, Nicholas. Thanks, James. Look, from our point of view, there's a two-tier approach to this. We're currently doing an update of the resources at the moment, and that is based on infill drilling and also extensional drilling around all of the existing mines over there. We expect that work to be completed probably sometime next month, and then we'll move straight into a full life of mine plan update, and that will support an ore reserve update. We expect to be in a position to provide updated resources and reserves by mid-year. That's step one. Step two is we've already got also our geology teams and also our exploration teams mobilized over here to look at longer term drilling, which will inform future updates. It's certainly for us, resource growth and reserve, resource-to-reserve conversion is going to be a major focus for us over the next two years. Okay, great. Thanks. Thanks, Jason. Thank you. Your next question comes from Hayden Bairstow with Macquarie. Please go ahead. Yeah. Thanks, guys. It's very early morning to you, guys. Just a question on MATSA. Just interested in your sort of initial thoughts. You've been there for a few weeks, and how quickly you think you can potentially modify things, particularly with these higher power prices impacting processing costs at the moment? Sort of is there much you can do on softer ore or anything like that on the mix to sort of ease the pressure on that front? The second one's just on Botswana. Just interested in the schedule that's in the preso. Are we starting to see a little bit of slippage to first production just in that second half of 2023, or is it just my eyes deceiving me? Thanks. Thanks, Hayden. Over to Jason for both of those. Thanks, Nicholas. Thanks, Hayden. Yes, it's very, very early in Spain here at the moment. I may get to eat breakfast in about three or four hours, apparently. Look, firstly on just offsetting some of the impact of those power costs. We are looking at some things at the moment, particularly to optimize some of that feed. With zinc prices going up significantly, what it does particularly is bring into play Sotiel as a much higher value ore source at the moment. We are particularly trying to optimize that and try and bring forward some of that zinc production probably into FY 2023 as well. In terms of softer ore, there's not a great deal of differential between the ores there in terms of power consumption. Dave touched on it a bit before. The team is looking at basically they're well advanced with development of dedicated solar facilities over here. We expect that the first stage of that could be brought in sometime in 2023. We're just trying to push that as hard as we can and try and offset some of these cost issues. In terms of Motheo, look, in terms of project development, we see no slippage at this point in time. Project team's doing an excellent job. We expect to start mining next month and all going in line, particularly with schedule, but also on budget. All right, thanks, guys. Thank you. Your next question comes from Lyndon Fagan with JP Morgan. Please go ahead. Thanks very much. I just wanted to concentrate on slide 19 that looks at the cost guidance. Am I right in deducing that the TCRCs or selling costs, as Dave talked about on that slide for both copper and the byproduct credits amount to around about $125 million a year annualized? Thanks, Lyndon. We'll pass to Matt for that one. Yeah. Thanks, Lyndon. We do present it here on a net basis. Any copper costs are certainly copper above the line in terms of C1 gross. Any TCRCs and other selling costs certainly sit below the line in terms of going against the zinc or lead or silver credit. You can deduce, of course, from effectively the zinc price, because that makes up most of the byproduct credit, what the costs are against that headline zinc price to get back to $1.72. Yes, there are, of course, the costs in terms of TCRCs. Also just remembering what we're delivering in terms of MATSA to the port is the concentrate to that point. Then there's also, of course, rollbacks and other deductions for things like shipping. It does then take on effectively those costs all the way through to customer. Yes, you should be able to deduct those from those numbers. Not necessarily in a dollar sense, but certainly in a per pound sense. If you have any issues, obviously let us know. Just to confirm the order of magnitude. If I take the byproducts at $72 and recreate the revenue based on the footnote and that, and those prices, then the gap I've got is TCRCs. If I turn that into a $1 million based on your guidance, I get basically $50-odd million annualized, and then I can work it out from the copper TCRC that's in there. I just wanted to confirm, because this is a big number, and it's also gone up relative to the previous disclosure. I just wanted to get a yes or no. Is it around about $125 annualized, or is there something else in there that's considered selling costs that is kind of polluting that? Yeah, I'm not sure about going up in terms of your comment about previous guide, the previous numbers, but certainly, yes, your number's reasonably close I would think. You can also deduct it from what we have put out in terms of gross and net costs. On a basis, just for example, during last year, where on a gross basis, the byproduct credit was, say, $2.50, and now the byproduct credit's $1.70. The difference between those two numbers is $0.80. You can certainly deduct that back to what a zinc byproduct dollar credit is. A similar thing for copper. Okay. Thanks. Look, the other question I had was just that comment around more lower grade material in the mine plan. I just wanted to explore that a bit. Obviously, you've only just got the keys, and this is a plan you've inherited. In terms of thinking about the grade profile, and I know I've already asked this and you're not really ready to talk about it in detail, but what's actually changed their relative to the previous discussions around the mine plan? Do we need to be thinking about more lower grade material over the medium term as well? Thanks. Thanks, Lyndon. We'll pass that one to Jason over in Spain. Yeah, Lyndon. You're absolutely right. We are working through this at the moment, and it is a relatively complex mine plan given you've got three mines, and it's basically got different contributions in terms of copper ore versus polymetallic ore there as well. Look, we are working through that, and particularly that cut-off grade strategy and the impact at the moment. If you look at our production at the moment, it's pretty much in line with the average grade from the ore reserve at the moment. A safe thing would be to basically project that forward over the near term. Obviously, we'll be working on optimizing that, and we'll be able to provide further information sort of around the middle of the year. Great. Thanks very much. Thank you. Your next question comes from Levi Spry with UBS. Please go ahead. Good day. Thanks for the call. Good questions there from Lyndon. Just exploring them a little bit further. Lower grade before we get the reserves, does zinc return back to sort of, you know, the 4.5% that it has been? And silver, I guess, nearly half. Thanks, Levi. We'll pass that to Jason. Short answer is, yeah, that's what we're getting out of the mine plan at the moment, and that's what we're working towards through to mid-year. As I kind of said to Lyndon there as well, the information that we have at hand at the moment, looking forward on the mine plan, there's a lot of work that needs to be done, particularly looking out at FY 2023 and beyond. We'll definitely be doing that work at the moment, but if you like, where we're projecting at the moment for the next five months is in line with that ore reserve. You know, we'll provide a further update there around the middle of year once we've got that resource update and we're able to update the life of mine plan. Yeah. Okay, thank you. Just back to the cost, just reconciling the $0.94 with the $0.40-$0.50 range initially. I think you said $0.25 was due to the higher processing costs. Does that mean the other $0.25 is all to do with the reduced credits? And what's the prospect for that $0.25 staying higher? Thanks, Levi. We'll pass to Matt Fitzgerald for that one. Yeah, Levi, you're right. Really if you're doing a comparison to that period, you're talking about processing probably around $0.25 higher, of course, driven by energy costs. You're also right. There's a, I mean, a direct comparison sense, zinc production a little on the lighter side, zinc price a little on the higher side. There is a contribution there from the C1 credit as well. There's also a bit of an impact in terms of mining. There is some inflationary pressures in terms of salaries, but of course, that is also then moved around in terms of what actual copper production and what actual zinc production happens in a period. When you're looking at a five-month period, of course, you're coming more and more narrow into a narrower mine plan across the three mines. All of that mixed together, then yes, that sort of creates a reconciliation back to last year's numbers. Okay. Thanks, Matt. What this last one on the D&A question, is there any reason we don't just take the price divided by 30 million tons or what the new reserve will be? What are the other price allocation considerations we need to think about there? Yeah. We're going through the process at the moment in terms of price allocation. It's not usually, as you probably know, hugely complex for mining operations. The price tends to end up, apart from the assets that are obviously clearly identifiable, the acquisition price tends to end up in mine properties. I think probably the biggest sort of high-level lever in our heads that means we need to certainly wait for that process to finish is over how many tons are you talking. As I think James mentioned, a 12-year resource, a six-year reserve with a resource that's around the same grade as the reserve, and is just subject to drilling entities and those sorts of things, that does get a little bit complicated in purchase price allocation, in terms of the impact of purchase price allocation, what that then has on depreciation, amortization rates. I'm a little reluctant to give too much until we've actually completed that process. It's not complete at this stage. The biggest decision in that really in terms of D&A sort of burn rate becomes, are you talking about a resource, a reserve or something in between? Thanks. Thanks, Matt. Thank you. Thank you. The next question comes from Kaan Peker with Royal Bank of Canada. Please go ahead. Hi, Karl and team. A few questions, if that's okay, mostly relating to MATSA. We've heard a number of zinc smelters are looking to reduce production recently. Maybe if you can talk through your outlook or expectations around zinc TCRCs, and I'll circle back with a cost question. Thanks. Thanks, Kaan. We'll hand that one to David Wilson. Yeah. Perhaps a market outlook on where TCRCs are going, we're just about to go into the process of resetting the TCRCs under the offtake agreement. At this stage, our forecast going forward is for that to stay pretty consistent to what we was baked into our numbers announcement. I guess that's something we'll need to look more closely at. Sure, thanks. Second one's on costs. I know we've talked about it quite a lot, but can you give an indication of how much costs have increased year-over-year on a per ton process basis? That's polymetallic nature of the ore body, and there's quite a bit of variability in the grade, that process. It's difficult to get a handle on what costs have done on a per ton of process basis. Could you give an idea of that, and what's been factored into the costs and power costs into guidance, how much of that's gone into the increase? Thanks. David again. Yeah. Look, thanks, Kaan. Look, the, on a pure cost per ton process, so incorporating, you know, mining and processing costs, it's of the order of 20-odd%. The vast majority of that, probably two-thirds to three-quarters of that probably does relate to the power price. The remainder is, I think Matt mentioned earlier, the general inflation. Now, I think the inflation number for that part of Europe for 2021 was, you know, 6%-7%, in that range. Some of that is flowing through to labor and some of the other mining contracts. That'll give you a sort of a guide as to on that cost per ton, how it's moved. Yeah, thank you. Is there any cost hedges entered into as part of that project finance facility? No, there isn't, Kaan. It's only on the copper and zinc side. As we mentioned before, on the energy side, that is currently running as spot. Sure, thanks. Just to squeeze last one in. With the targeting of low-grade ore, as far as I understand, that's a function of higher commodity prices. Is that correct? I'll pass that one to Jason in Spain. Please go ahead, Jason. Yeah. Kaan, just to be clear, we're not targeting low-grade ore at the moment. What the team do is they do optimize cut-off grades depending on the outlook for metal prices. When those metal prices do increase, what it does is brings low-grade material into the schedule. We are seeing some impact of that at the moment. As I said, all of the material there that we expected from a resource and reserve point of view, that's all intact. What we need to do is make sure that we're optimizing in terms of delivery of value to the company, rather than maximizing resources and reserves at this point in time. That's the piece that we'll be working through, basically, in the coming months. Sure. The flexibility within MATSA's short-term mine plan, I think, following Hayden's question, you touched on, you said you could probably target more zinc in the next three or so months. Is that Yeah, look, there's an opportunity to do that given the pricing at the moment. If you go back to comparing to when we actually, you know, submitted the bid and entered into the transaction, those pricing that pricing environments significantly different. There is an opportunity to be able to do that and bring forward some value. Cool. Last one, sorry. In terms of silver, the recoveries there, have they changed or is that mainly a function of grade? I'll pass that one to David here in Perth. Yeah, Kaan. For this period, the next five months, you'll note the lead concentrate is a fairly modest volume. Typically, the lead recovery is in the order of 35%. This period, the lead grade drops below 1% for a couple of periods, where actually there's some periods where the lead grade's too low to produce a lead concentrate. That has impacted the silver production in these next few months. We see that in the subsequent periods. We see that starting to return and much more consistent lead recovery. We're expecting the second half of this calendar year, and that'll bring with it more silver. Look, that's something that we've been digging into pretty closely with the met team and the geology team there at MATSA. We need to get a better handle on to really understand how we can do that. Because clearly, it's not. Zinc and copper are the clear drivers of value, but, you know, we want to make sure we're optimizing right across the spectrum. Sure, thank you very much. I'll pass it on. Thank you. Your next question comes from Daniel Morgan with Barrenjoey. Please go ahead. Hi, Karl and team. Perhaps a follow-up on all the grade and questions. At MATSA, you appear to be mining a lot more polymetallic ore in the six-month guidance. Perhaps 20% of ore, which compares to reserves, resources of about 38%-39%. Is that a choice to go after the poly or to get the zinc? Or is that mine scheduling or a bit of both? Thanks, Daniel. We'll pass that one to David Wilson. Thanks, Daniel. In terms of the split between copper ore and poly ore, it's about 25/ 75 in this period, the next five months. Yes, that is perhaps more poly ore than what we spoke about in September. I think to answer your question is, you probably answered your own question. What we have found, and following on from Jason's comments, is that with the current price outlook across all the different commodities, the NSR of the poly ore is sort of much higher than what it was previously. Yes, the mine is trying to take a bit more poly ore where it can. Particularly it brings so. As Jason said earlier, it brings Sotiel in as a really good option, really increases the value of that material, even though it has the extra trucking distance associated. Okay. I guess a follow-up question to that is your five-month guidance for the poly ore, particularly, which you're targeting. It's 3.4% on the zinc, which appears to be below the reserve grade of about 4%. Is that bringing in this low grade? I guess the net smelter issue we've talked about is doing. I guess I'm trying to think, you know, does that zinc grade lift back to reserve grade? Should I be thinking about in FY 2023 and 2024? David, again. Yeah, you'll see on slide 17 the differential between the Magdalena and Aguas Teñidas. So, the Magdalena zinc grade is performing pretty close to, I think, reserve, maybe a little below. We see that going forward as maintaining that, perhaps strengthening through the rest of the calendar year. Aguas Teñidas is the one that's perhaps a little low still at the moment that we, as Jason said earlier, as we work through this next, life of mine plan, we'll really look at how we can optimize that, but there are a couple of new mining areas that are just coming to production here that we need to understand better on when we can start to improve that grade. Maybe turning to the CapEx guidance, and I know, you know, you're giving us five-month guidance, which can be, you know, things can be lumpy and not necessarily a sustainable basis to guide on. Simplistically, what would you see as sustaining and development CapEx on a yearly basis, you know, on average, year in, year out for this operation? Is this a good guide or is there a different number we should use? Thanks, Daniel. Over to Matt Fitzgerald for that one. Yeah. Thanks, Daniel. Obviously, we have to be a little bit careful in my answer in terms of we haven't put out future, obviously, you know, resource reserves, mine plans and future guidance. Just as a general indication, about $100 million per annum, so on an annualized basis between mine development and sustaining. Mine development for these five months is probably on the slightly lighter side of the range. Then the sustaining CapEx is probably on the slightly upper side of it, of a general ongoing range. Of course, subject to other things like, you know, solar projects and other things that may come up from time to time. On an annualized basis, put them together about $100 million per annum. Okay. Thank you. Lastly, you've taken on some debt to do this acquisition. Can you just guide us on, you know, roughly the finance cost or the interest cost on the debt? Thank you. Over to Matt Fitzgerald again. Yeah. Thanks, Daniel. Look, obviously got to be a little careful in terms of disclosure, in terms of specific rates, but certainly competitive, at an international sort of banking level. You're in the sort of 3%-4% type ranges, in total. Okay. Thank you very much. Thank you. Your next question comes from Timothy Hoff with Canaccord. Please go ahead. Hi. Thanks, guys. Most of the questions are answered, so just one quick one for me, which was the $17 million guidance for the acquisition costs. I see $4.6 in the first half numbers. Does that imply what $12.4 expense coming through in the second half? Thanks, Tim. We'll pass to Matt Fitzgerald. Yeah. Correct, Tim. That's correct. Cheers. Thanks, guys. Thank you. Your next question comes from Peter O'Connor with Shaw and Partners. Please go ahead. Matt, just housekeeping, U.S. dollar accounts now. When will you be in a position to give some pro forma backward-looking stuff beyond just the two halves you put in this presentation? Peter, in June. We'll also have the June comparative back to the prior year. In part of that process, of course, as you might understand, is actually going back a fair way. Any other gaps that you have in sort of historical models or anything else we'll want, when we do that June numbers, we'll be able to share some of those. We'll be able to disclose those sorts of full year. We'll be able to share some of that historical with you as well. Okay. Jase, it sounds like by the Q&A so far, there haven't been a lot of positive surprises in MATSA. Have there been any, and can you recap? Are we missing any of the negative surprises which haven't come out yet? No. Look, I wouldn't say there's really any negative surprises at all. I think what we're seeing is a lot of opportunity. The mine operation is run well over here. There is opportunity to improve, so we see that as significant upside in terms of additional production and costs. You know, Dave kind of touched on it there before as well. We think that the potential of Sotiel is higher than previously thought, both from a resource and reserve upside, but particularly utilizing that and the benefit it's giving from zinc pricing on an increased NSR. But overall, we're really optimistic and really think that it's got a very bright future, this operation. Thank you. Your next question comes from Stuart McKinnon with The West Australian. Please go ahead Good day, Karl and team. I was just wondering if there was any sort of impact on the business other than higher energy prices from the conflict in the Ukraine at the moment, not just the conflict itself, but the sanctions by the West against Russia. Does that impact the company in any way or the copper market in any way? Can you give us some color or commentary around that, please? Thanks, Stu. We'll pass to Karl over in Miami. Karl, please go ahead. Yeah. Thanks, Stuart. Look, at this point in time, Stuart, we're not seeing any impacts, specifically as a consequence of that conflict. Not at this stage. We're not quite sure where that conflict will get to, but certainly not having an impact on us. Look, you know, obviously we're not terribly, like the rest of the world, very happy with what's going on, but it's not having an impact on our operations. Okay. Thanks, Karl. Not having an impact on those costs. Pleasure. Cheers, mate. Thank you. Your next question comes from Matt Greene with Credit Suisse. Please go ahead. Hi. Good morning, all. Just to go back on the unit costs here, on my calc, it's just over $1 a pound in selling costs, and about $0.50 is on that, on the credits there. I mean, is that all TCRCs? Because it seems pretty high, or are there marketing costs to Trafigura included in that number? Thanks, Matt. We'll pass that to Matt Fitzgerald. Yeah, thanks, Matt. I think I would look at it on an all-inclusive basis. You are correct in that there's a split for copper, which is effectively above the line in terms of selling costs, and there's a split, as you said, for the credit, the byproduct credit for predominantly zinc. Think about it as a mine that's delivering four concentrates. Remembering it's delivering those concentrates to a shed in the Huelva under the sales agreements. Any cost, whether it's up to that shed, which is obviously transport, and anything post that shed, so TCRCs, shipping. What you would normally incur all the way up to the customer is effectively incurred back in terms of what you, on a net basis, sell that ore, that concentrate through to the landing facility in Huelva at. All-inclusive TCRCs shipping, and road transport. Okay, that's great. If we take that $1 a pound, are you able to give us a rough split as to how much of that is transport and TCRCs? I don't have any precise numbers in front of me, so let me get back to you. Okay, that's great. Thanks. Just one follow-up on Matt. I guess in the next few months, one of your key near-term projects is the long-term mine plan. Are you expecting to complete this by mid-year? If so, when do you think you'll be in a position to provide some medium-term outlook on MATSA to the market? I might pass that one over to Jason in Spain. Jason? All right. Thanks, Matt. You're right, that is a big focus over the coming months. We expect to finish that work around the middle of the year and then inform budgets going into the new financial year. At this stage, we plan to be able to update the market early in the new financial year. That's great. Thanks very much. Thank you. Your next question comes from Alexander Papaioanou with Citi. Please go ahead. Hi, all. On Motheo, I just wanted to confirm that there hasn't been a change on the Botswana government's decision to not take up their stake in the project. Thanks. Pass that to Matt Fitzgerald. Yes, correct, Alexander. The government of Botswana has advised they won't be taking up their potential 15% ownership stake. Okay, thanks. Thank you. Your next question is a follow-up from Levi Spry with UBS. Please go ahead. Thanks for letting me squeeze another one in. Just for Jason, NSR calculations. Can you just confirm what prices you're using for those? How short-term are they versus what you'll use for the reserve? I guess I'm trying to tie it into Dan's question around what is the actual medium to longer term blend between copper and poly ore? Hi, Levi. Look, in terms of I don't have those numbers in front of me at the moment, but if we look at going forward, really beyond the five months that we've guided, it will be really a piece of work that will be done over the coming months, so over the next five months going into the new financial year. In terms of that, look, in terms of looking forward longer term, I'll be working on the current reserve numbers. Okay. Thanks, mate. Thank you. Thank you. There are no further phone questions at this time. I'll now hand back to conference to Mr. Simich. Thank you very much, everyone, for listening in today and to this half year to 31 December financial results and update. May I just say in closing that we have been working very hard executing our strategy. We are transforming our business into a global base metals future-facing company. There have been a number of elements that are putting us in a very good position going forward. DeGrussa has continued to operate exemplary, and it's been a wonderful mine that continues to do extraordinarily well. Motheo is full steam ahead, as we've been talking about today and is on time and on budget in terms of moving into production by the middle of 2023. You know, that transformational acquisition of the MATSA Mining Complex in Spain, in that Andalusia region, and whilst we're talking about some specifics here today, I think the opportunity is immense. There's been very limited exploration that's occurred there. There are three underground mines. There is a big, robust processing facility. Whilst there's a bit of granularity that we're working through at the moment and you're all asking those questions, we appreciate those. I think the actual opportunity for that to achieve a stable operation at nameplate is the number one priority. Number two is then to look at opportunities where that could be enhanced in terms of the production profile beyond the current nameplate, and I think there's possibilities there. More so the potential down in that belt, where there's been limited exploration over the last 15 years, I think is enormous. To be in a position where the control of that belt to a large extent, with 2,500 sq km in that Iberian Pyrite Belt, to have the commanding position that we do have in the Kalahari Copper Belt, and to also have substantial exploration opportunities in and around DeGrussa in Western Australia in the Eastern Seaboard, as well as a project that we'll continue to work on and look forward to making positive economic decisions to proceed on in Montana, probably, you know, in the future once we've worked through a few things, has put the business in a very strong footing to go forward and clearly in the commodity space, and in a particular commodity value, I think that's going to be very robust. You know, we have, you know, you know, accumulated in the system now an order of magnitude, it must be approaching, if not in excess of, five million tons of contained copper in resources, and it's our job to go and extract maximum value from that fine ore and extract maximum value. I think it looks good. It's been a great half year, and we look forward to, you know, uh, embracing everything that we've got on, in our business and, really, moving forward in a very positive manner, over the next 12 months. It's going to be an exciting period for us. Once again, thanks very much everyone for listening in, and, I hope you all have a great day. Thank you very much. That does conclude our conference for today. Thank you for participating. You may now disconnect.