We're about to begin. Good day, and welcome to the Neo Performance Materials Third Quarter 2022 Earnings Call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Ali Mahdavi. Please go ahead. Thank you, operator, and good morning, everyone. Thank you for joining us this morning. As a reminder, a replay of this call will be available starting tomorrow in the Investor Center on our website, located at neomaterials.com. Joining me this morning are Neo's President and Chief Executive Officer, Constantine Karayannopoulos, and Neo's Chief Financial Officer, Rahim Suleman. Please note that some of the information you will hear during today's presentation and discussions will consist of forward-looking statements, including, without limitation, those regarding revenue, EBITDA, Adjusted EBITDA, product volumes, product pricing, other income and expense measures, cash returns, and future business outlook, including potential expansion plans. Actual results or trends could differ materially from those discussed today. For more information, please refer to the risk factors discussed in Neo's most recent financial filings, which were filed on SEDAR earlier this morning and are also available on our website. Neo assumes no obligation to update any forward-looking statements or other information which speak as of their respective dates. Financial amounts presented today will be in US dollars. Non-IFRS financial measures will be used during this conference call. Further information regarding Neo's use of non-IFRS measures is available in Neo's earnings press release, which is available on SEDAR and on our website at neomaterials.com. I'll now turn the call over to Constantine. Thank you, Ali, and good morning, everyone. Pleased to have the opportunity to update you today on several strategic initiatives on which Neo has made significant progress this year, as well as our quarter. While global economic sentiment appears to be pivoting downward in the near term, we are confident in our ability to effectively manage our business through every stage of the business cycle, just like we've done so many times over the past three decades. More importantly, we're building upon these strong businesses to generate significant growth in the future. Before I get into the quarterly results, let me first provide an overview and context to some of the strategic announcements we've made over the past few months. Over several years, we've been working to develop an integrated plan that builds upon Neo's legacy strengths of product quality, innovation, and customer service. Ensuring our customers have visibility into the security, reliability, and sustainability of our critical materials is more important than ever. These qualities are essential to winning the next piece of business, but also to building long-term mutually beneficial relationships with our customers. As we pursue various avenues of growth, one thing is abundantly clear. We must expand our operating infrastructure in order to meet rapidly growing demand for the critical rare earth and rare metal materials that are needed by hybrid and electric vehicles, new energy storage and distribution, clean air and clean water technologies, and responsibly sourced components for consumer goods. For Neo, the global energy transition presents a once-in-a-lifetime long-term growth opportunity. To take full advantage of this, we must be able to position ourselves and scale rapidly in three key areas. First, upstream raw material diversification. Second, expansion and modernization of existing plant and infrastructure. Third, downstream expansion of Neo magnets, both sintered and bonded. Through each of these, and through our legacy product innovation and customer service efforts, we can assemble the rare earth in advanced materials infrastructure to establish the secure ESG-focused supply chains that our customers need to meet the challenges of of climate change. Regarding raw material diversification, as many of you know, we have been discussing the importance of raw material diversification on these calls for a number of years. Having long-term committed suppliers and and diversity of supply is paramount to the strength of any well-functioning supply chain. Our customers and their customers have made it clear that they want localized supply chains. When long-term legacy feedstock suppliers to Neo are at or near capacity, we must encourage their suppliers to further expand their operations and to influence them to adopt stronger ESG practices. It's not enough to have shovels in the ground ready to deliver material. We must build our business relationships through a prism of respect and a shared understanding of sustainably sourced materials. That includes working with partners who fully believe in the importance of our carbon neutral future. Securing offtake rights at an early stage of development provides Neo and our customers with additional optionality. It also allows Neo to help influence strategic decisions in the development of new rare earth resources, decisions that align with our vision for sustainability and minimal impact on the environment. During the quarter, while we have continued our dialogue with a number of promising emerging producers, we recently made particular progress with three potential upstream partnerships. First, Sarfartoq in Greenland, the former Hudson Resources Rare Earth project, Yangibana in Australia, owned and operated by our current largest shareholder, Hastings Technology Metals, and Koppamurra in Australia, a heavy rare earth ionic clay deposit owned by Australian Rare Earths. On Sarfartoq, during the quarter, we announced that we are in the process of acquiring the exploration license and rights for the Sarfartoq rare earth deposit in Greenland from Hudson Resources. There's been renewed interest and clarity provided by the local Greenland government related to the exploration, mining, and processing of the mineral deposit. This has helped to alleviate prior concerns around potential developments of this project. Our team visited Greenland to meet with the local community to better understand its needs and what this development means to them. They also engaged further with the government to understand its willingness to support the project. The team conducted a site visit to get visibility on the available resources and was strongly encouraged by Sarfartoq's development potential. While this is a long-term project that would be aligned with long-term growth for rare earth materials in Europe, we have a high level of confidence in the technical team involved, which we have assembled. Due diligence efforts related to the transfer of the exploration license from Hudson Resources to Neo are continuing, but importantly, we believe this project can be fully supported by renewable hydroelectric power with minimal disruption to the environment. Next, our newest major shareholder, Hastings Technology Metals, is currently developing a rare deposit in Western Australia at Yangibana. We have been monitoring the team's progress at Yangibana for a number of years, and this project skews very attractively towards magnetic materials. It has the potential to be a competitive producer of mixed rare earth carbonate materials for our facility. They aim to have initial rare earth offtake available in 3-4 years based on current timelines. We welcome Hastings as a shareholder, and we look forward to further evaluating their asset as a potential source of raw material for our plants in the future. Last, we also signed an MOU/joint development agreement after the quarter's end with Australian Rare Earths Limited or ARE regarding its Koppamurra heavy rare earth clay deposit. ARE and Koppamurra is one of four known heavy rare earth clay deposits outside of China. There's a notion in the world of magnetics that there will be enough, or at least there's an expectation that there will be enough neodymium and praseodymium for anticipated adoption curves with permanent magnetic motors in things like electric vehicles and wind turbines. The heavy rare earth elements that help maintain magnetic properties at high temperatures have less visibility to adequate supply. This problem will need to be addressed from multiple angles. It includes continuing to minimize the heavy rare earth content in magnets, as Magnequench and Daido have done in producing highly engineered magnetic powders and hard deformed magnets for Honda's electrified drivetrain systems that contain zero heavy rare earths. It also means bringing online new heavy rare earth deposits that can be developed in an environmentally responsible manner. We see AR3 as having a high potential for success, and we look forward to developing this relationship further. The common theme around these three potential resources is that they're led by strong technical resources and advisors who have been involved in the rare earth industry for years. Substantial work remains to be done with all of them, but we will continue to explore new arrangements that can produce responsibly sourced materials with a desired ESG footprint. Each of these projects can help take a step forward in providing additional raw material optionality for our customers and build upon our current supplier arrangements. We continue to reliably purchase material for our separations plant in Estonia from our legacy supplier, Solikamsk Magnesium Works, as well as from Energy Fuels in the United States. Energy Fuels continues to make substantial progress towards expanding its access to primary monazite raw materials. Last, we're continuing to evaluate and expand our recent supplier relationships in Southeast Asia to support growth in both Asia and in Europe. With regards to our Sintered Magnets efforts, in addition to substantial steps regarding raw material diversification and growth across our supplier base, we announced earlier this week that we have been awarded a significant grant from Europe's Just Transition Fund, which I've talked about before, for the construction of our Sintered Rare Earth Magnet manufacturing plant in Estonia. This is the culmination of terrific efforts from our senior executive team, our local team in Estonia, our Magnequench innovation team, and government leaders in Estonia. Each of these stakeholders sees the powerful potential of the vertically integrated rare earth manufacturing hub in Estonia to drive the transition to electric and hybrid vehicles, more offshore wind turbines, and other innovative decarbonization technologies. I want to convey my personal gratitude and thanks to Estonia's Prime Minister, Kaja Kallas, Minister of Entrepreneurship and Information Technology, Kristjan Järvan, and all the other government officials in Estonia for their leadership in this joint investment with Neo. We look forward to further building upon this shared vision to create new jobs and economic opportunity for the citizens of Estonia and to serve as effective agents for climate resiliency. Our phase one production capacity target is 2,000 tons per year of sintered magnet block, which will produce around 1,500-1,600 tons a year of magnets, depending on size and shape. Although it's early at current market levels, we believe this phase one capacity would indicate potential incremental revenues of $135 million-$160 million at current prices. This is obviously a meaningful contribution to Neo's long-term plans, and recent discussions with current and potential customers have indicated strong support for further growth beyond these phase one levels. With the benefit of the JTF funding grant, we're accordingly developing plans for phase two and beyond. The Just Transition Fund financial commitment from the EU and the government of Estonia further de-risks phase one of our sintered Europe project, and it adds to our confidence level. As we develop our long-range planning for phase two, it was also very encouraging to hear the President of the European Commission call on the urgency for localized rare earth supply chains established in her State of the European Union address on September 14th. Her announcement of the launch of the Critical Raw Materials Act and the creation of a European Sovereignty Fund to support projects of strategic European interest in critical raw materials creates policy tailwinds that can only fast-forward our growth efforts. In order to deliver the raw material inputs for these sintered magnet plants, there's an obvious connection back to increasing our localized upstream raw material relationships, but it's also essential for us to review our rare earth separations capacity and modernization. The rare earth requirements for 2,000 tons per year of sintered magnetic blocks are larger than our historic production at our Silmet plant in Estonia, which is currently the only commercial industrial scale rare earth separations facility operating in Europe. We anticipate that we will supply the new sintered magnet plant with both rare earth inputs from Silmet and from other sources. We remain in early planning stages to evaluate the timing coordination of potential expansion efforts for rare earth separations at Silmet. Of course, we'll approach this project with the same rigor and methodical approach to ensure an appropriate ROI for growth capital. All three phases, upstream raw material diversification, expansion modernization of our existing infrastructure, and expansion into sintered permanent magnets will be a part of our long-term roadmap for growth. It is still a very exciting time for us at Neo, and we're very busy implementing these plans and assuring that we'll have the adequate human and financial capital to execute on these plans. For the capital requirements related to sintered magnets, we intend to fund this project through a combination of grants, like the European JTF funding, as well as accessing various options in the European debt markets as well as with cash on hand. During the quarter, we announced a $75 million project loan agreement for the modernization and relocation of our auto emissions catalyst facility in Zibo, China. We proceeded to groundbreaking on that new facility this past summer, and we're currently in process for early works construction activities. Our legacy plant remains operational in the meantime, within COVID restrictions, of course, and we intend to operate the old plant into next year as we qualify products from the new facility. We also completed a $50 million bought deal equity offering at $15 per share during the quarter after the recent transaction announced between Oaktree Capital and Hastings, and we decided to shore up our balance sheet. It's no surprise that the current capital market environment is tighter than it's been in recent years. In that tight market, the Oaktree deal opened a window for us which provides several benefits for the company and its shareholders. Which primarily the additional capital enabled us to move ahead with our sintered magnet strategy prior to the completion of any potential public financing or grants like the Just Transition Fund grant. Having a clear sight on near-term capital availability allowed us to establish specific timing commitments. This is a critical step toward bringing on a new supply chain and balancing the coordination of upstream and downstream expectations. Pursuing this new capital allowed us to accelerate our plans and significantly de-risk our internal timelines. Second, Neo has historically maintained adequate flexibility through free cash flow to allow us to be opportunistic in terms of new technologies and potential acquisition opportunities. In today's market, we do see such opportunities that we're in the process of evaluating them. I expect to be updating you on these discussions in the near future. As we move forward with each of these strategic growth projects, I want to convey my own excitement over the strategy that we've outlined. It's also important to note that we have dedicated operations teams around the world to ensure that our strategic growth strategies are not getting in the way of our legacy and day-to-day operations. Let me now turn to the third quarter results. As you likely saw in our announcement and filing this morning, we reported $146.7 million in revenue during the third quarter. While we enjoyed mostly tailwinds over the past couple of years, the latest quarter was a mix of strategic tailwinds and pricing, short-term pricing volume headwinds. The P&L indicates a mixed story as the industry works through some relatively lower market pricing conditions as compared to the start of the year. In addition, these financial results are largely reflective of today's broader macroeconomic trends. With some new challenges currently indicating potential temporary slowing consumer demand patterns across all regions, our top-line sales remain strong relative to Neo's historic norms. They are, however, weighted against the complicated backdrop that more frequently points to a potentially softer demand environment. While pricing remains relatively attractive compared to pre-pandemic norms, it has been more volatile over the short term and retreated about 40% over the past 6 months. That volatility is placing short-term pressure on our margin levels as higher cost inventory and LCM adjustments flow through our P&L. Rahim will provide greater color in his comments on this. I will remind shareholders that this lead-lag volatility is more or less normal in our industry. When pricing stabilizes, which appears to have started over the past 6 weeks, our unit economic model usually stabilizes in turn over the next several quarters. There were some positive themes in the quarter, such as decreasing shipping costs, excuse me, and strong volumes across Europe and North America. These were overshadowed by the continuing uncertainty in the Western world. The war in Ukraine continues, and ripple effects are growing, particularly related to energy programs and their related cost impact as Europe prepares for winter. This reverberates through the food production and advanced chemical supply chains as key processing reagents are limited in production and driven to higher prices. A couple words about COVID. Regional supply chain disruptions are unfortunately still a common occurrence, particularly in China. Just this month, we observed more pandemic-related disruptions in China, including in Zibo, where we have one of our facilities, for our emissions control catalyst and separated rare earth products. Mandatory shutdowns or limited operating days in China continue. While this downtime usually doesn't affect our finished goods shipments in a significant way, it can impact our operating schedules, operating efficiencies, and our ability to receive raw material. While such impacts tend to be shorter today than in the previous couple of years, there are still challenges that consume resources and attention. Regarding automotive, the automotive industry, inflation has more than crept into the automotive sector. Higher-priced new vehicles are the norm, and the average priced vehicle soared more than 30% over the past few years in North America. The used car market jumped accordingly as new cars simply weren't available. There is still less than one month's worth of available inventory on many dealer lots. Even while some of these impacts have started to ease, semiconductor chip shortages still plague the industry. Regional temporary shutdowns within China remain all too commonplace, and these inhibit the movement of critical automotive parts and assembly. When you add higher consumer interest rates to the mix, large portion of consumers are simply getting priced out of the new car market. For the full year 2022, automotive production is anticipated to be about 80-82 million units, which is about 3-4 million units lower than last year's forecast. The industry is not expected to get back to 90 million units until 2024 at best. While automotive OEMs reduce output forecasts for internal combustion engine vehicles, clearly one of the obvious areas for growth and innovation is the fact that the industry is developing resilient critical material supply chain for electric vehicles. In the near term, as EVs continue to gain market acceptance, especially in China, throughout the first 9 months of the year, Chinese consumers purchased more than 3 million pure battery electric vehicles. They're now on track to purchase more than 4.5 million of these vehicles per year. Chinese automobile tax rebate incentive program for low displacement vehicles instituted this past June has clearly had a strong impact. EV sales increased nearly 50% since the advent of this policy, and more Chinese producers are opting for new energy vehicles, either battery-powered or plug-in hybrids, at a dramatically higher rate. These combined electrified vehicles are on pace to achieve a 20%+ penetration rate this year, 3 years ahead of the original 2025 policy target date. While China has taken a clear edge in EV adoption, similar dynamics are at play in Europe as battery and hybrid vehicles steadily improve market share. Through the first nine months of the year, sales of EVs and plug-in hybrids achieved a 19% market share in Europe, just barely trailing China. While the Scandinavian countries continue to lead from a market penetration perspective, Germany has moved past the 25% electrified threshold. North America remains a little bit further behind, but it is growing quickly off a smaller base as sales of EVs year-to-date have increased 70%. These trends are not new, to support the continuing growth and adoption of EV technologies, the rare earths industry needs to provide a stronger, more resilient base for electric motor manufacturers and the confidence to OEMs to continue to design in these permanent magnet motors. In other words, the industry needs orders of magnitude more extraction, refining, magnet, motor, and drivetrain production in order to meet the 2035 targets for decarbonization and electrification. In closing, the near-term business environment has a lot more uncertainty than any of us want to see now that we're two and a half years into the global pandemic. That said, our operations have remained strong in the face of these past and present challenges. Our employees' dedication and resolve to do the right thing is unparalleled in the industry, in my experience. Our unique business model positions us very well with dual supply chains both within and outside of China, and the strategic positioning to capitalize on the major tailwind trends. On the base of strong foundational operations, I'm both very excited and confident in our long-term growth plans provide us and our customers with powerful flexibility. Also have allowed us to carve out a commanding lead in product innovation and help to ensure that we're delivering for our customers day in and day out. We look forward to keep you apprised of these developments in the coming quarters. I'd now like to turn the call over to Rahim for a detailed review of the quarter. Thanks, Constantine. The third quarter and the start of the fourth quarter have taken on somewhat of a transitory feel. After posting record earnings in Q1 and Q2 of this year, we are now posting a significantly lower quarterly earnings result for Q3. We have, on numerous occasions, talked about the value add nature of Neo's operations, and we have noted that we are not a commodity player, but rather a value add producer. Our contracts and prices are designed with pass-through clauses that increase our price when rare earth prices rise and decrease our price when rare earth prices fall. We seek to maintain a spread between our selling prices and the input commodity costs that covers our conversion costs and provides a healthy margin. This is a strategic and long-term value proposition, and it has proven to be an excellent value creation model. However, in short-term periods, it does cause fluctuations in results, and that can be tied to commodity price changes. This isn't a fundamental change in profitability, but rather just a timing impact that you commonly hear me refer to as lead-lag. As mentioned earlier, we recorded our two strongest quarters in Q1 and Q2 of this year, and that was aligned with the rise in rare earth prices from 2021 to Q1 2022. As Constantine mentioned earlier, rare earth prices declined significantly in Q2 and Q3, and this has resulted in this lower earnings quarter. Despite our Q3 Adjusted EBITDA of just over $7 million, our year-to-date Adjusted EBITDA is $66.6 million. We spoke openly about the positive impact of lead-lag in Q1 and Q2, that we were selling at higher prices in the moment while utilizing inventory that was purchased historically at lower costs. In Q3, the opposite is true. We are selling at lower prices in the quarter while utilizing inventory that was purchased in an earlier quarter and at higher costs. If we could buy inventory and sell finished goods on the exact same day, one would see that we have an embedded spread that drives our margins. However, the timing of inventory purchases and the conversion period causes these quarterly fluctuations in results. As we have noted in previous discussions, Neo's strategy is a long-term value add margins and results are always best understood over a longer-term time horizon rather than just one or two quarters. As Constantine mentioned, key magnetic rare earths fell by approximately 40% over the last six months. This follows a trend whereby prices tripled from about two years ago. Let me provide a little more specific detail on this current change, at least with respect to two magnetic elements. The prices of neodymium and praseodymium decreased particularly rapidly in Q3, with pricing bottoming out at about $85 per kg. This is a substantial decline from about $140 per kg earlier in the year. So far in October and the start of November, these prices have somewhat stabilized in the $90-$95 per kg range. Despite the recent drop, prices remain about 2x higher than they were two years ago. This bodes well for the industry, and we believe this is a healthy range to provide assurances to both the upstream and downstream verticals. This also leads to more dollar value margins available for certain products where there is some spread available in the pricing formula. This level of fluctuation is a little bit unusual, but there is, whether there is a lot of fluctuation or a little, the Neo strategic direction to pursue pass-through pricing and focus on reliable margin spreads should be evident, particularly in the longer term. With the current macroeconomic environment, we did see lower volumes, particularly for Magnequench powders in the quarter. This was offset by continuing strength in our emissions catalyst business and growth in our water treatment business. We are especially proud of the turnaround in the results of our rare metals business. Our rare metals business posted a record quarter and is having a record year in earnings. There is some lead-lag benefits in these year-to-date results, but that should not overshadow the impact of higher selling prices and the diversification to higher margin products. This has been part of the team's focus for some time now. Shifting to the balance sheet, we increased our cash and cash equivalents to $123.9 million in the quarter, primarily as a result of the primary equity raise, which yielded $47.7 million after transaction costs. Year to date, we invested $11 million into property, plant, and equipment, and we distributed $9.9 million in dividends to shareholders. The corresponding impact of the recent decline in rare earth prices is the overall reduction in working capital during the quarter of about $11 million, which further improved our cash position during the quarter. Digging one level deeper, one would see higher AR balances presently, which will quickly convert to cash in the coming quarters and lower inventory balances, which will generate more cash now as our inventory replacement costs are lower than our existing inventory costs. Over the last two years, we have seen a significant increase in our inventory balances due to the rapidly rising rare earth prices. As prices stabilize following this drop, we expect that we can reduce inventory balances from the 2022 levels, generating even further cash. At Neo, we maintain a balance of both short-term and long-term focus areas. We need to be vigilant with managing our cash, constantly looking for continuous improvement opportunities and efficiencies in our manufacturing operations, and a focus on growing customers and key product volumes. We also maintain a long-term view of value-added margins, environmental sustainability, creating a resilient global supply chain, and working closely with our customers to develop products for the future that come with our unique and deep rare earth and rare metals knowledge and expertise, including furthering a complete magnet to mine strategy. With that, we'd like to open up the call to questions. Thank you. If you'd like to ask a question, please signal by pressing star one on your telephone keypad. If you are using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Once again, press star one to ask a question. We'll pause for just a moment to allow everyone an opportunity to signal for questions. We'll take our first question from David Ocampo with Cormark Securities. Thank you. Good morning, everyone. Good morning, David. Constantine, I think on the last call, you called out phase one as being able to produce around 400 tons of magnets, but the CapEx number is probably half of where the current phase one CapEx is going to come in at. I'm just trying to get a better sense on how you're gonna spend $100 million, but get essentially 4x the annual tons of sintered magnets. Is that just primarily from scale? I'm sorry, David, I don't recognize the numbers that you're talking about. 400 tons of magnets you said? Yeah, I think that was the number that you gave on the previous call. This call you're calling for 1,600, but it seems like the CapEx number is higher. Let's go on the assumption that that's not accurate. Yeah. We can clarify it now. We're going with a 2,000-ton-a-year block facility with increase. Initially, we're looking to produce about 1,000 tons of magnets, which would have required something in the order of 1,300 tons of magnet block. We've upped that to 2,000 tons of block, 1,500-1,600 tons of magnets, as I said in my comments. The CapEx, again, I don't recognize your numbers, David. You may be confusing the grant parameters that say EUR 18.75 million of grant for up to EUR 100 million of capital investment. That doesn't mean that the capital investment today is planned for EUR 100 million. It is a bracket that the Just Transition Fund has said, regardless of what our own CapEx requirement is for whatever we do in Estonia, they are providing this grant for up to EUR 100 million total investment. Is that clear? Our investment is still much more in line with what we talked about before, which is, you know, the original CapEx estimate was about $50 million for 1,000 tons of magnets. Clearly, as we move capacity up, we're inching that CapEx estimate up, but it's not $100 million. I hope that makes sense. Yeah. That's clear. That's my fault there. On the revenue guidance that you gave for phase one, how should we be thinking about EBITDA margins from that $135 to, I think it was a $160 that you quoted? Yeah. The easiest way to think about it is that the EBITDA generation would be somewhere in the same. Again, without being too explicit and for competitive reasons, we can't really talk too much about the granularity of the business, but we should expect the sintered magnet expansion in Europe and eventually North America to generate margins similar to what Magnequench is generating today. Perhaps a little bit better than that, given the fact that, you know, the supply-demand dynamics in Europe are what they are. But you know, that's what the objective is here. Got it. Rahim, next question's for you. I know we've always asked this in the past, but you alluded to this in your prepared remarks, but how should we be thinking about kind of the sustainability of EBITDA? Like, what's the earnings power of the business if pricing does hold steady at these current levels? I think the statements that I've talked about in the past is again referring to long-term trends. Look, honestly, every given quarter has some movement one way or the other. Clearly over the last couple of quarters it's been awkward since it's only been rising rare earth prices for kind of 3 or 4 quarters. I think you probably have to find a balance between those rising quarters and kind of where we were before that. Now, bearing in mind where we were before that was also COVID. Even if you go back a little bit further, I know talking about something that's so historical sounds awkward, but I think that it still provides kind of the right reasonable range with some growth in the overall business. Okay. That's helpful. Then just as a clarification, Rahim, you guys took an $8 million write-down on the inventory, and I see that $6 million went into Chemicals and Oxides. Where's the balance in that? $1 million of it is in rare metals, then $1 million of it is Magnequench. It's honestly a little bit awkward for Magnequench to take that kind of a write down because Magnequench's margins and gross margins are quite healthy. It is really only because there's a certain portion of the Magnequench supply that is, let's say, longer in its route in order to get to the customer for various reasons. That particular material was really purchased back in the March timeframe, which was the peak of the rare earth prices. It's $6 million in C&O, $1 million in rare metals and $1 million in Magnequench. As I said, Magnequench is unusual. It has enough margins to usually handle any sort of fluctuation. That number isn't reflected in the Adjusted EBITDA number in $7 million, right? The write-down's reflected in that. That's correct. It's not added back. It's a cost. Yeah. Got it. Okay. Thanks so much, guys. I'll hand the call over. As a reminder, that's star one for questions. We'll go next to Mark Neville with Deutsche Bank. Hey, good morning, guys. Can you hear me? Can, Mark. Hey, sorry about that. It looks like you keep about 3-4 months of inventory in the business. Is that about right? Yeah, it's different by business unit. Rare metals is actually a little bit longer. Magnequench in China is much, much shorter, so it does change business unit to business unit. I think overall probably it's 4-5 months. Yeah. Yeah. 5 months. Okay. Again, I'm just trying to think about normalizing earnings here. It's probably like Q1, Q2 before you sort of get to like whatever a normalized number would be. Say Q2. Yeah, I think by Q2. I think we'll start seeing. Look, I think that this quarter is particularly difficult and, you know, David just mentioned the LCM and understanding what the LCM does, right? It takes margin challenges from Q4 and pulls them forward. This quarter is abnormally affected. I think by Q1, probably second half of Q1 and Q2 is when all that inventory would flush out. Okay. Sorry, just to follow up on one or two of David's questions. Sorry, the $7 million or the $8 million write down, like that's not adjusted for. Again, if we wanted to adjust to that, you get closer to 15. Is that right? That would be correct. Again, like I guess following up to one of his questions. Again, if we look back to 2019, like you did, I think you've averaged for the year about $13.5 million of Adjusted EBITDA at your rare prices to your point are like 2x that. So how would you tell someone to think about, again, the earnings power of the company relative to 2019 when rare prices are 2x? I assume it's. I'm not suggesting you need to double the EBITDA, but like how should we think about that, I guess in a long-term context? Yeah. Certainly, yeah. Certainly a healthier EBITDA margin and EBITDA results than the period that you would have referenced. Because as I said, although you know, we do focus on passthrough, there is still some a couple of percentage point spreads in how the passthrough mechanism works. Portions of our business that don't have passthrough, certainly there's more dollar value margin spread there. Certainly from that baseline, you know, it's 10%-15% more. Plus you're talking about the business other dynamics of the business growing. You don't necessarily always see growth if you just look at the line called pure volumes, which is why we try to help you with kind of differentiating where that growth is. Because some of, you know, some volume's worth $1 and some volume's worth, you know, $500. We try to talk about where we see value growth. I think we have seen more growth in the higher value areas rather than just units going out the door. I think you start with there's a bump in the rare earth pricing dynamic, which is helpful, but I think there's also a bump in the fundamental business. Got it. That's helpful. Thanks, Rahim. On the Zibo expansion or relocation, when does that start? And roughly how long does that take or are you expecting it to take? Well, Mark, it has started, as I pointed out. We expect to be constructing through 2023. Starting things up later in the year, but it should be a late 2023 startup and commissioning. Just all the spend would happen over the next 12 months, give or take, or the big chunk of that CapEx spend? Yeah. The biggest portion, that's a safe assumption. Okay. Sorry, can you remind us again? I've got in my notes, so just remind the number around that. Was it, like, $100 million? 75? 75. Yeah. 75 is the right number. Okay. We've already spent some of that $75, and some of that $75 is related to some inventory build and some contingency. You know, not all the $75 just gets, you know, flushed out from where we are today. Some of it will go out the door, but some of it will get recovered when we lower inventory balances too. Okay. It's not all sort of capitalized. Some of it goes through inventory? Yeah. From where we sit today, it's not a net new or a net $75 going out the door. It'll be less than that. I mean, it'll be close to it, but it'll be less than it. Okay. Somewhere between. Okay. Sixteen. Somewhere between. Okay. The inventory build, David, is... Sorry, Mark. The inventory build is a necessary part of it. There will be some time when the old plant will stop operating and the new plant will be testing. We're trying to be conservative here and make sure we don't run any customers out. Got it. All right. Thanks for the time. Appreciate it. Thanks, Mark. We'll go next to Ian Gillies with Stifel. Morning, everyone. Morning. Morning. I just wanted to confirm that the 2,000-ton plant in Estonia is the expected capital cost $100 million or is it gonna be slightly less? Two, would you consider that project formally sanctioned yet, or do you still need customer commitments to move ahead? The easy part first. We are moving ahead. Customer commitments will come only after magnets have been fully qualified, which I mean we're going through the qualification process now with magnets from our pilot plant. Ultimately, the full commitment is contingent on making the right magnets that perform the way that they're specified. However, we are having all kinds of conversations with, I would say, five major Tier 1 drivetrain producers who are screaming for capacity. We're entering into non-binding type of arrangements. I guess that's the way the automotive industry works, which is still in addition to the conversation we're having with the Tier 1s, conversation we're having with the actual OEMs, their customers are also extremely encouraging. The reason we moved up the scope of phase one, Ian, is that the original design of 1,500 tons of alloys, 1,000-1,200 tons of magnets was too small, given customer indications. We're going with a larger capacity plan that will be able to at least satisfy some of the initial needs of those 5 Tier 1 drivetrain producers. On the CapEx, as I explained earlier, the $100 million was an indication of the parameters of the grant. Originally anticipated, phase one with 1,000 tons of magnets was going to be in the order of $50 million. Phase one plus two for 5,000 tons was going to be in the order of $200 million. We expect that phase one, that we're designing now is going to come in a little bit higher than $50, but well under the $100 million threshold that the grant specifies. We expect that this is going to be sort of closer to between 60 and 70, probably closer to $70 million for phase one for 2,000 tons of blocks. Okay. That's really helpful. Just one last clarifying point on that set, that question. So it was 1,000 tons of magnets, and if I think back to an earlier comment, you're now at 1,500-1,600 tons of magnets. Is that the I just wanna make sure I'm Correct. Comparing apples to apples. Correct. The phase one capacity is in the order of 50-60% higher. I guess this is a directional comment because depending on what magnets you make, what size, what shape, you have significantly different yield losses, right? The smaller the magnet, the more complex the magnet, the higher the yield loss. For simple geometries, large magnets, you could have 20% yield losses or perhaps even less with the large wind turbine magnets, which are very simple magnets. As you get smaller and more complicated, you could be losing as much as 30-40% of the material that comes out as a block before it gets shaped into the final magnet. That's helpful, and it's really useful in trying to understand kinda CapEx dollars per unit produced. I apologize if I missed this in your prepared remarks, but at the last call, you thought there may be some interest-free loans that you may be able to access while building this facility. I get not everything moves along the same timeline. Is that something still in the works and in play? Yeah. I don't know about interest free. I think I talked about low interest loans from sovereign banks and. Sorry. Yeah, yeah. That, that's still part of the discussion and the negotiation. Yes, definitely. Understood. Sorry for the misrepresentation. Yeah, no worries. At the risk of stating the obvious, would it be fair to presume that Magnequench's margins will return to more normalized levels, quite a bit quicker than C&O, just given what we saw in the quarter? I'm just trying to reconcile that given the inventory write-downs and so forth. Yeah. You know, if we talk about returns, let's say in Q1, second half of Q1 as we talked about earlier in the call, to avoid kind of minor moving around. C&O's pricing dynamics for normalized pricing will return. Their inventory lag is longer, but their pricing dynamics will return quicker. Magnequench will get to the right margin per ton levels faster, but is more affected by, let's say, slowdowns in volumes. In terms of which one actually returns to normalized dollar value margins faster, I couldn't really tell you because I think it really depends on how quickly the volume side recovers for Magnequench as well. Okay. I'm gonna try here. I'm not sure if you guys will give me the answer, but are you willing to provide any guidance around capital spending in fiscal 2023, given you're now moving forward with these two large projects? You know, I appreciate the question, and I'll say maybe we could talk about it in another quarter or so. I mean, clearly it's gonna be a big capital spend year, as Constantine just outlined, with respect to the Zibo relocation and the auto catalyst expansion project. In terms of the Magnet project, you know, the timing of when we lay out deposits for equipment versus receiving the equipment and paying the full payment on all those things, I think that's still a little bit hard to make a specific comment on for 2023. Okay. I appreciate that. I'll turn the call back over. Thank you for the detail. One other comment on this. As I've outlined in my comments and in various one-on-ones, we now, given the last equity raise, given the EDC loan, and then the cash flow generation, we have enough cash to execute on all of these fronts. That was, I guess, one of the reasons why we did the equity raise back in August to allow us to do, especially the Magnet project expedited, fast forward it and start ordering longer lead items and doing preliminary work and making commitments. We have enough cash on hand, and we're generating enough cash that will allow us to finance both of these projects without accessing the capital markets again. Okay. No, fair enough. Understood. All right. Thank you. We're mindful of this being Remembrance Day and 11 o'clock. We need to shut things down. Are there any other questions? Operator, we've got another 5 minutes at the most. At this time, there are no further questions. Right. That concludes today's call. Thank you for joining us. As usual, if you have any questions, please feel free to reach out. I'll hand it back over to operator to close the call. Thank you. This does conclude today's conference. We thank you for your participation.