Good morning, ladies and gentlemen. Welcome to the Lithium Royalty Corp. first quarter 2024 results conference call. At this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. To ask a question, please press star followed by one on your telephone keypad. This call is being recorded on Tuesday, May 14, 2024. I would now like to turn the conference over to Jonida Zaganjori, Vice President of Investor Relations at Lithium Royalty Corp. Please go ahead. Good morning, everyone. Welcome to Lithium Royalty Corp's First Quarter 2024 earnings call. Please note that our complete financial results are available on our website, lithiumroyaltycorp.com, under the Investors tab and also accessible on SEDAR+. This event is being webcast live. A replay of this call and transcript will be available on our website. Joining us today are Ernie Ortiz, President and CEO of Lithium Royalty Corp, and Dominique Barker, Chief Financial Officer and Head of Sustainability at LRC. Ernie will begin with introductory remarks, followed by Dominique, who will provide an overview of our financial results. After the presentation, we will transition to a Q&A session, where our executive team will respond to your questions. We would like to remind participants that today's commentaries may contain forward-looking information. For more details and other important notices, please refer to our press release dated May 13, 2024, available on our website and SEDAR+. Please note that all figures referred to on today's call are in US dollars, unless otherwise noted. I will now turn the call over to Ernie. Thank you, Jonida, and good morning, everyone. We are pleased to report our first quarter 2024 financial results. Revenue declined by 11% compared to the same period in 2023, largely due to the impact of significantly lower lithium prices. Market prices for lithium declined by approximately 81% in the quarter compared to the prior year period. Compared to fourth quarter 2023, prices declined by 48%. In addition to the drop in lithium prices, lower production in Mount Catlin, as disclosed by Arcadium, and timing of shipments at our other operators contributed to the revenue decline on both a year-over-year and sequential basis. It is worth pointing out that the first quarter 2024 marked the lowest prices witnessed in the lithium industry in more than two years, and since the lows observed in January and February of this year, prices have increased meaningfully. Many price reporting agencies highlight that market prices for spodumene concentrate have increased by approximately 25% since the market lows seen early in the year. We believe that prices are likely to remain volatile, but should continue the recovery going forward, given one, swift supply curtailment and deferment from industry participants, two, environmental reviews and inspections, reducing production of certain high-cost lepidolite mines in China, and three, positive demand trends in electric vehicle sales, mostly led by China. It is also worth noting that inventory levels across the EV supply chain have materially improved, and some elements of restocking for battery materials is being observed. As we commented in our 2023 annual results, we believe 2024 will be an exciting year for LRC, driven by robust organic growth at several of our portfolio companies. In 2024, we expect three products to commence production, including Zijin Mining's Tres Quebradas operation, with phase one capacity of 20,000 tons per year of lithium carbonate, Atlas Lithium's Das Neves project in Minas Gerais, Brazil, for which phase one is fully funded with a stated capacity of 150,000 tons per year, and Ganfeng Lithium's Mariana project, for which the company has reaffirmed plans to start operations by year-end 2024, for its 20,000 tons per year of lithium chloride capacity. As a royalty company, our corporate overhead is minimal, and we are well positioned to benefit from the continued development and successes of our portfolio companies. As we transition from three producing portfolio companies currently to six by year-end, the operating leverage of the business model should be better illustrated. Furthermore, even assuming no further price improvement from today's levels, the impact from the decline in prices are likely to prove most pronounced in the first quarter, with sequential improvement expected in the second quarter. In fact, at current market prices, the second quarter should be the first quarter of sequential price increases for the lithium market since LRC became a public company. On the acquisition side, LRC completed one transaction in the quarter, a $1.5 million investment in private company M4E Lithium. The company has rights to one of the largest lithium packages in Brazil, over 91,000 hectares, with a focus on the Lithium Valley in Minas Gerais, but also with holdings in the Borborema, Ceará, and Tocantins regions. Their land claims both historical artisanal spodumene and tantalum mining, and following LRC's capital infusion, the company has completed further soil and chip sampling campaigns. They expect to begin their new drill campaign this month. This transaction further enhances LRC's leadership position in Brazil, having invested in Sigma in 2018, Atlas in 2023, and M4E in 2024. We believe the speed to market in Brazil is unrivaled in the Western world, given robust but expedient permitting, abundant renewable energy, and attractive mineral endowments for hard rock lithium resources. Organically, many of our portfolio companies continue to de-risk their operations and advance their development. Key items to note: In Argentina, both Zijin's Tres Quebradas and Ganfeng's Mariana projects are expected to start production in the second half of the year... providing two additional revenue-producing projects to the LRC portfolio. On a macroeconomic basis, the halt of public works in Argentina has improved the availability of labor and materials, while moderating inflation has made it easier to do business to help advance these projects. Sigma Lithium approved the initiation of construction for its phase two operations in Minas Gerais, which would add 250,000 tons of additional capacity. Sigma is guiding phase two production to commence in the first quarter of 2025. At Winsome Resources, they completed 22,000 meters of drilling in the quarter, which resulted in the company expanding the strike length at its world-class Adina Lithium Project to 2.1 km. The company expects to announce an updated mineral resource estimate in the second quarter of this year, following its maiden announcement of a 59 million ton resource in the fourth quarter of last year. Additionally, Winsome signed an exclusive option to acquire the Renard Diamond Project, which was a diamond operation through the fourth quarter of last year. The design capacity could support 250,000-300,000 tons of SC6 production, according to Winsome, with a preliminary economic assessment expected in the second half of this year. At Delta Lithium, the company has 4 drill rigs at Malinda, with the company recently reporting positive assays, including 34 m at 2% and 22 meters at 1.4%. The company expects to release a scoping study in the third quarter of this year. And finally, Sayona Mining released the definitive feasibility study on the Moblan Lithium project. The ore reserve included 34.5 million tons at 1.36% lithium oxide, which is expected to support a 300,000 tons per year spodumene concentrate operation for 21 years. It is important to highlight that this updated DFS represents a 50% increase to the concentrate production from the prior DFS on Moblan, highlighting the optionality from our embedded royalty positions globally. LRC continues to see a robust pipeline of acquisition opportunities, with valuations across the space improving, reflecting the current market conditions. LRC will continue to prioritize acquisitions with a high proximity to cash flow and will remain disciplined on managing their balance sheet. I will now pass to Dominique, who will discuss our financial results. Thank you, Ernie. Our royalty revenue this quarter was $631,000 at the, compared to $1,000,000 in the previous quarter and down from $708,000 in the same period last year. There are two main reasons for the decline. First, volumes were lower at all three producing projects, partly due to lower lithium prices impacting production, as Ernie discussed already. Second, the lithium price applied to those volumes was lower. I would also add that the timing of shipments by our operators also played a role, which I will discuss in a moment. General and admin expenses was $1.6 million in the quarter, which is favorable versus last quarter at $2.2 million. Excluding non-cash stock-based comp, cash G&A was only $1 million in the quarter, and that's a reduction from $1.35 million in the previous quarter. LRC's adjusted EBITDA declined to negative $662,000 in the quarter, compared to negative $221,000 in the same period last year, and was roughly flat with the negative EBITDA of approximately $695,000 in the previous quarter. The timing of shipments also impacted our first quarter results. For example, Sigma Lithium finalized two shipments in the first quarter of 2024, versus three shipments in the fourth quarter 2023, which of course, negatively impacted volumes for LRC. Sigma announced the sale of its eighth shipment of 22,000 tons on March 27th, but that shipment only went out in early April, so that will be a contributor to our Q2 results. As our portfolio matures, the timing of individual shipments should have less pronounced impacts on quarterly results. Another example of that timing is Core Lithium. They sold just over 10,000 tons of concentrate in the first quarter, 2024, but they had almost 20,000 tons of spodumene concentrate available for sale at the end of the first quarter, which is expected to be sold in the second quarter, 2024. Expect continued meaningful resource growth, growth from several of our royalties, which are expected to commence construction and then production in the next 12-36 months. As these projects begin production, you can expect continued growth in our royalty revenues and further accretion to our net asset value. Our current liquidity position is strong. We had $9.3 million of cash at quarter end and zero drawdown on our credit facility. In summary, we are optimistic in 2024 that the combination of recovering commodity prices, our confidence in the probability of true ups from quotational pricing adjustments in future quarters, and the ramp-up of producing projects and new projects commencing production, will all add to our revenue and to our EBITDA. As we mature, we expect our NAV to grow as producing and exploration assets are de-risked, and we add new royalties. I will now pass back to Ernie for closing remarks. Thank you, Dominique. I will now cover a review of the lithium market during the quarter. The International Energy Agency estimated electric vehicle sales grew by 25% in the first quarter compared to the prior year period. This growth is on the higher end of the 20%-25% forecast many analysts had assumed for 2024. EV sales in the first quarter typically represents only 15%-20% of total annual sales, suggesting a strong backdrop for the balance of the year. Despite EV sales growth moderating in North America and Europe, in the world's largest electric vehicle market, China, sales remained robust, with growth of 25% in the quarter, driven by a proliferation of affordable EV models in the country. We are similarly encouraged that at the Beijing Auto Show in April, over 80% of the products were new energy vehicles, and that in late April, the Chinese government announced a subsidy regime to trade in less efficient vehicles with a 10,000 CNY subsidy for electric vehicles. Estimates suggest that this subsidy could enhance demand by as much as 2 million incremental EVs this year, or more than 10% of annual global sales this year. Affordability is often the leading reason behind a consumer's propensity to purchase an electric vehicle. In China, the IEA estimated that 65% of electric cars sold in 2023 were cheaper than their internal combustion engine counterparts. As we see continued competition among OEMs, affordability is likely to grow further. In the West, the Transport and Environment think tank is tracking five new EV models to be released this year in Europe with an MSRP below EUR 25,000, while two more are on track to be released in 2025. In North America, GM is set to unveil the Chevrolet Equinox EV in mid-2024, with a starting price of $35,000. While Tesla recently commented that it plans to launch more affordable models as soon as later this year. We've recently witnessed Xiaomi achieve substantial customer adoption in China with the introduction of its SU7 sedan with a starting price of $35,000. The company received nearly 90,000 orders in the first 24 hours, with 70,000 of those locked in and firm to receive the vehicle. The car is effectively sold out for the next six months and boasts a minimum battery pack size of 74 kWh and maximum size of 101 kWh, highlighting continued customer uptake of affordable EVs. We expect sales of electric vehicles to accelerate globally as more affordable models are released, and particularly in the United States, as more models qualify for the full $7,500 IRA subsidy. In the energy storage sector, we see continued robust activity, with Bloomberg New Energy Finance forecasting the global energy storage market to grow by 61% year on year in GWh terms. This implies 155 GWh of incremental growth in 2024, with 91% of the storage capacity expected to be LFP chemistry, supporting continued growth for lithium usage in the energy storage sector. As stated earlier, given production curtailments and continued double-digit demand growth for lithium chemicals, the industry is quickly rebalancing. Additionally, inventory levels have continued to improve across both the battery sector and the lithium sector. As such, we expect prices to continue to improve over the balance of the year, which should provide another important tailwind for LRC, coupled with the three additional projects expected to begin production this year. LRC is extremely well positioned to benefit from this growth as an owner of royalties that offer attractive exposure to these secular growth thematics, with no exposure to operating costs or capital expenditure budgets. To conclude, we remain excited by the path forward and look forward to additional portfolio companies entering production in the second half of the year. I will now pass back to Jonida to open the question and answer portion of the call. Operator, we're now ready to answer questions. Can we please open up the lines for Q&A? Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. Should you have a question, please press the star followed by the one on your touch tone phone. You will hear a three-tone prompt acknowledging your request. If you are using a speakerphone, please lift the handset before pressing any keys. First question comes from Ben Isaacson at Scotiabank. Please go ahead. Good morning, Dominique, Ernie, Jonida. This is Apurva on for Ben. In your report, you mentioned that Core is willing to restart mining operations at Finniss, having paused earlier this year, if and when the price environment improves. I just wanted to ask if you had a sense of what that incentive price for that mine restart might be? Hi, Apurva. Correct. So, and, in their public report for the quarter, Core did announce that they developed plans to restart Finniss, subject to market conditions. We'll defer to them on kind of the appropriate incentive price, but we can comment that market prices have improved significantly since when they made the decision to cease mining operations. So it's much different dynamics, and the rebound is certainly encouraging. Other things that we'll mention is that, and just on the broader kind of spodumene landscape, is that typically when you start a spodumene operation, once you get to the anniversary period, there are significant cost savings involved. We've seen typically around 30%-60% across the industry for new mines in the spodumene sector. So, it is possible that they could further lower their costs in a potential restart, which is something that we'll look to Core to provide additional commentary on. But overall, we feel very encouraged that we have a lot of optionality with Core. We've received more than 50% of our overall purchase price already. They've also increased the resource by 58% to 48 million tons. So, we'll defer to Core on the appropriate incentive price that they feel is appropriate to restart the mine. But the language is certainly encouraging, and we look forward to the optionality that LRC has with its royalty. Great. Thank you. And then my next question, so you've discussed kind of the projects, the three projects coming online in 2024, and it looks like those are all on track. So looking further out, do you have any concerns about some of the production or ramp timelines for companies that are that will be entering production in 2025 and beyond? Sure, good question. So I think, one of the best parts of the LRC portfolio is that we're well diversified, I'm sure there will be some that will be moving slower than expected, and some will be moving faster than expected. I would say the near-term development pipeline, which we always commented as Winsome, Zenith, Thera, Delta Lithium, they're continuing to move on at a pretty accelerated pace. Delta Lithium still has about $100 million of cash on the balance sheet, and they're continuing to move forward with the development of their project. They mentioned they're looking for a scoping study in the third quarter of this year. And similarly with Winsome, they're still well capitalized and looking to move forward as fast as possible. And, with the Renard option, they could actually move forward production because of the lesser permitting timeline that that would entail. So, I think we are seeing some very strong momentum still on the near-term pipeline, but I would say on kind of the further tail end of the portfolio, there probably have been some delays. But on balance, given the impact to our Net Asset Value and kind of our marquee royalties, those are still on track. So there shouldn't be. It should still be a net positive for the portfolio. Thank you. Thank you. The next question comes from Patrick Cunningham at Citi. Please go ahead. Hi, good morning. Can you talk about the magnitude of supply curtailments that you've seen to date and where those are coming from? And what's your level of confidence that lepidolite is maybe biased towards curtailment? Do you have any concerns that there might be some elasticity of that supply, you know, if we do see prices continuing to trend up and maybe supply cuts come from other regions? Thank you. Sure. So we've seen supply curtailments pretty much across the lithium industry, with both on the low-cost side and the high-cost side, so it's been pretty much across the board. If you look at the three largest spodumene mines in Australia, well, the average blended production for Greenbushes, Pilgangoora, and Wodgina production was down 9% year-on-year. So it's a good example that both on the high end of the cost curve and low end of the cost curve, we have seen pretty swift supply curtailment, and especially in when the industry growing at double digits, call it 20%-25%, that production curtailment is quickly rebalancing the market. We also did see supply curtailments on the likes of the lepidolite producers in Yichun because of the environmental inspections. I think you brought up a good point. There's a limited visibility on how quickly they could ramp up, or especially, well, how those inspections will progress for the balance of the year. But, I think, inspections aside, those operations are struggling at current market prices. So, I think, it is something worth monitoring, but, I think for us, we view that the industry is being very disciplined, given the supply curtailments that we're seeing across the space, and that is helping to support overall prices. And now inventories are a much better situation, such that if we do get into a restocking cycle, it could be the start of a new lithium cycle coming into the second half of the year. Great. And there's obviously been some very recent headlines on, you know, EV tariffs and trade wars. Can you talk about what this might mean for demand from Western lithium producers and if we maybe see some premium pricing in the short to midterm? Or do you think this just more so curbs U.S. EV demand more than anything else? Sure. So I think we'll have to wait to see what the full legislation is. I believe there's going to be an announcement later this year, as has been reported by the press. But currently, the Chinese EV OEMs don't really play in North America. So in the near to medium term, it was likely to be limited, given there was no real plans to enter the North American market. And even setting the tariffs aside, a lot of the domestic OEMs are already planning to release some very affordable and attractive models, as you mentioned, with the Chevrolet Equinox EV. So I think it's too early to tell what the impact will be. But I think, on a broader level, what attracts us about the LRC portfolio is just our global diversified nature, that, irrespective of kind of the geographic mix of where the demand comes from, we're ultimately focused on aggregate demand for lithium. So, we're still very encouraged by the overall trends in the industry, which are declining EVs, more uptake and greater penetration. And I think that's going to be the much the driving force for the LRC business model than kind of the overall geographic mix and some of the potential noise that we'll see with tariffs on the horizon. Great. Thank you. Thank you. The next question comes from Mac Whale at Cormark Securities. Please go ahead. Hi, good morning. Just one question for me. Just trying to look at the year and understand the impact from the three new producers. We've seen how long it takes for brine operators to ramp up. Like at Lithium Argentina, it's probably going to be 18 months before they get to full capacity from the startup. Is there any meaningful impact from, from those two in particular on 2024? So I think that it's early to tell for us to provide any guidance with that commentary. What we can point to is that, Shanghai Metals Market, or SMM, the news provider in the space, has commented that, 3Q will start production, or is expected to start production in the third quarter of this year. And, Mariana has also reaffirmed that they're expected to start production before the year-end of 2024. So, I think it's tough to say what, how many tons will be in each particular quarter. I think we'll continue to track and have our dialogue with our operators to get the most accurate information. But we are optimistic that, just given the timelines and kind of the near-term production of these assets, that there will be revenue in 2024. But no question that 2025 should have the more meaningful contribution to revenue from these assets as they continue to expand and get to the proper ramp-up. Okay. And then, just, I'm wondering, maybe Dominique, you can describe in more detail how the true-up occurs. I'm having a little bit of a difficulty trying to figure out how, you know, as I run models on particular assets and sort of forecast a production level and then assume a pricing, how should I think about how that rolls into your model, and then factoring in sort of a true-up? Like, how are you doing that kind of math? Yeah, Mac, it's not easy, particularly when you don't have a large portfolio of assets. So with a large portfolio of assets and different diversifications, that will help. Having said that, we're exposed to the lithium market. I think the way I think about it, it's almost like momentum in a stock price, and so as the price goes up, then the quotational pricing can adjustment in the following quarter also goes up, and as the price of lithium comes down, you kind of have a segment of time where you don't have much quotational pricing adjustments down, and then it, it's a lot like momentum. It's not easy. It's not, it's not easy. And all we do from a quarterly perspective, if you take a look at our revenue recognition policy, our revenue recognition policy is to use the best available information at the time. I will say that in Q1, the quotational pricing adjustment was fairly minimal, like, I would say, on the order of 5%. So it... And so you can expect if pricing stays where it is, and Ernie mentioned how pricing has gone up 25% from the bottom at Q1, you can expect quotational pricing adjustments to be in the positive direction in Q2. The way, we can maybe do it offline, but just out of curiosity, you're really looking at volumes from your royalties, and you're making your own assessment on pricing that you then true up. You're not really modeling individual companies with what pricing they may get. Do you understand what I'm saying? You're using, like, a global pricing and looking at total volume exposure. Is that how you're doing it? We continue to true up over the course of the time when we put together our financial statements. So in the very early days of putting together, like, at the very end of the quarter, we will have an estimate based on posted commodity prices. As information comes in from our producers, we will make adjustments up or down. T hat will depend on their ships that are out. Some of them are open for on the order of three months, and the changes continue to come in over that three-month period. Okay. I understand. That's helpful. Thanks, guys. Mac, on a related point to pricing, other things that we're seeing in the industry is that not only is the benchmark price increasing, but also we're starting to see improving realizations. So, a good example would be if you look at Sigma's disclosure, in the February and March shipments, they were getting 7.5% of the fast markets price. And in their most recent presentation, they've been talking about their May shipment getting to 9% of the fast markets price. So that's another potential positive tailwind going forward as well, that not only are the benchmark prices going up, but overall the realizations are improving as well. Okay. That's a great, great point. Thanks. Thank you. The next question comes from David Deckelbaum at TD Cowen. Please go ahead. Morning, Ernie and Dominique. Thanks for taking my questions today. Ernie, I wanted to ask your opinion, as you look at projects coming online in Brazil, you know, one of the key benefits, I think you highlighted the improved yield that you're seeing on a pricing basis out of Sigma, and obviously they received some better pricing around some ESG-oriented products. But, when you think about the long term in Brazil, it seems like the fairway is just there, is likely to send all of the product over to China. Are you seeing a commensurate response to the upstream that's coming online, more on the midstream side, outside of China, that might result in better pricing for Brazilian spodumene? Because you, you've obviously noted that Brazilian spodumene is really the fastest path to the upstream market right now. Are you seeing any indications that the midstream market intends to move, you know, with at least somewhat of a similar pace there? Yeah, I think it's a good point, and I think there will be a mismatch between the upstream and the downstream. So, especially as we're seeing some of the North American investments in the midstream potentially see some form of delays. They're not major delays, but at the same time, they are delays, especially if upstream in Brazil is moving so quickly. I think we are under the expectation that at least for the next couple of years or in the near term, Brazilian spodumene is most likely to serve the Asian or the Chinese market. But over time, it's, we are still relatively new in the industry, and it's a nascent industry. We think supply chains will continue to evolve and diversify. A good example of that would be AMG, where they are essentially gonna be feeding their spodumene to their hydroxide plant in Europe. So there's opportunities for that to continue and to continue to grow. So we've already seen, I guess, even at this stage, Brazil already diversifying into other Western markets, and we think that will continue to grow. But I think you alluded to in your question, there is a timing mismatch on when the midstream comes online versus the upstream. But over time, I think we are seeing a lot of interest from both North American and European potential converters in Brazilian spodumene, just given its speed to market and also easier logistics and transportation, especially with the renewable power in Brazil. It could be very positive, especially with the European battery passport in 2026. So, I think near term, still likely to be a Chinese-focused market, but over time, it's gonna be diversified, and it's gonna be finding its way over to North America and into Europe. Thanks, Ernie. My second question, you know, and, and I'm, I'm curious your thoughts on this as well. You know, I know that you can't necessarily guide as to when Core's Finniss project would be, coming back online or what sort of price would trigger that. But I am curious, in your dealings with, with sort of emerging spodumene producers, if there is a, a different interval now that they're looking at for how stable spodumene pricing would be at an incentive level for a period of time before bringing a project online. Do you think some of the lessons of the last couple of years have resulted in emerging developers or producers perhaps delaying some of the projects or slow-walking some of the projects until they're supremely confident that perhaps there's a pocket in, call it 2026 and 2027, where pricing would be stable in that very, you know, sort of sensitive portion of a mine's early life? Or is that not necessarily the case, and the industry hasn't necessarily changed the way that they schedule projects coming online? No, it's not. I think it's a good point, and I think it also depends on the point in time when the mine is seeking financing. I think when we're seeing at more robust periods of the lithium cycle, essentially very few discussions about floor prices. But I think now at this point now, where we're at the inflection point and recovering, I think we're seeing in our conversations with new potential mines kind of the reintroduction of floor prices. So, it's... I think it's typical kind of in relation to where we are at a point in the economic cycle. But I think, and what we've seen from some of the larger producers, is that some of these floors are holding up quite well at this stage of the market, and that's been insulating their own margin performance. So I think it's probably safe to assume that kind of the new explorers and developers are kind of taking a look at that and trying to apply that to their own new contracts. So I think that is, I would imagine that floor pricing, especially for new offtakes and kind of new operations, is gonna make a kind of resurgence in the conversations. But ultimately, it comes down to the leverage between buyers and sellers. And luckily, at least now the market is improving. So now the buyers o r sorry, the sellers have more power than maybe we had three to six months ago, and we think that's encouraging to help bring on some of these new mines. Thanks, Ernie. Thank you. At this time, we have no further questions. I'll turn the call back over to you, Jonida Zaganjori, for closing comments. Thank you to everyone who joined us today. This concludes our first quarter 2024 results conference call and webcast. We expect to release our second quarter 2024 results after market close on August 8, with the conference call held the same day at 5:00 P.M. Thank you for your interest in Lithium Royalty Corp. Goodbye. Ladies and gentlemen, this concludes your conference call for today. We thank you for participating, and we ask that you please disconnect your lines.