African Rainbow Minerals Limited (ARI) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. My name is Thabang Thlaku, and thank you for joining us today for the presentation of the African Rainbow Minerals (ARM) results for the financial year ended 30 June 2023. [Operator Instructions] I will now hand over to the ARM Executive Chairman, Dr. Patrice Motsepe. Thank you Chair.

Thank you. Thank you so much, Thabang and thanks to everybody to the shareholders, the employees and those -- and the Board members who are here, is that Dr. Rejoice there? Is that you, Dr. Rejoice, no, it's not. Okay. But welcome to everybody and our CEO, wonderful Phillip and Thabang, and we are privileged that Mike is continuing to provide guidance because, as I said many years ago, I had the honor of -- many, many years ago we are part of these families that have joined the giving pledge that have committed to give half to the poor. But the point I was going to make is many years ago, I went to Omaha, had a meeting with Warren Buffett because we saw you join there's all of these private discussions. And one of the important things is what he has always said, we invest in companies because of the management, because of the skills and expertise, and we always keep the people who've got a huge amount of experience, keep them with us to continue sharing that experience and side-by-side with that, we bring what we seek are the youngest and smartest bright, South Africans. And that's why Mike's continuing role is of such a huge benefit, just like André did in the past. Now this is going to be a short presentation because the results are self-explanatory. I just want to raise 2 issues that are important. The first is those circumstances, those factors that are under our control. And in that regard, we have to be world-class. And part of that, as I said, is to attract and retain the smartest and the very best because we've always said that African Rainbow Minerals must be a globally competitive company, but also in the quality of people we employ. In the first instance, of course, they must be the smartest and the brightest and we've got to look after them and looking after them includes pay them well. We've got to pay the people, we have the honor and the privilege to work with, pay them competitively. And as a starting point, pay them better than competition based on performance. But -- so those factors that are in our control, operational efficiency, productivity, profitability and link to profitabilities, bonuses that are competitive, critically, critically important. But side-by-side with that, are issues which are not under our control. And under the factors that are not under our control, there are what I call low-hanging fruits and the others that are a little bit more remote. The first low-hanging fruit that is outside our control, but where the engagement with our partners should result in world-class performance is logistics, it's transport, it's specifically Transnet. And many years ago, when I was President of business in South Africa, one of the key issues always was when we talk to government behind closed doors, we have to be uncompromisingly forthright and frank, and sometimes express the extreme irritation -- not irritation, frustration, extreme frustration because we've got to be -- we have the capacity in partnership with Transnet just like what happens in Brazil and in Australia and in other countries, work together, so that Transnet is a world-class partner that is efficient, that is competitive, and we pay fees to Transnet that are appropriate and that are competitive. So that's a low-hanging fruit. And that's why I said you are not likely to influence government irrespective of how absolutely frustrated you may be by going public and telling them that they're not doing what they should. So I find when I sit with the -- I don't want to say specifically, but when I sit with the people who are involved with Transnet, the first thing they say about you guys keep attacking us, you keep criticizing us. Sometimes they deserve to be criticized, just like all of us. But the truth of the matter is we need to work together. And that's why -- we have to continue to maintain and build the trust. So I just want to say in conclusion those engagements with Transnet to make sure that, that partnership for the whole of the industry results in South African mining companies being globally competitive is critically important. That's a low-hanging fruit. We should never really be having problems as a country in relation to how this partnership with Transnet enough trains timeously. The issue is not to take away rights from Paul and give them to Benjamin. I'm not saying from Peter to Paul. The issue is create more capacity. The country needs the income, the taxes from as much of our exports as possible and side-by-side with it, bringing new entrants -- we don't just want that we support it. So that's an easy -- that's a low-hanging fruit whereas a country because it affects our results. You will see that part of our volumes are down because the partnership with Transnet, which is something that's important to us, can do better and much better, not just African Rainbow Minerals, the same applies to all of the mining companies that -- that use Transnet. The second one, which is maybe not so much of a low-hanging fruit, but it's also something where we can and should do better. And I'm told that it is going to be better. It's Eskom and electricity. It's very important. But having said that, we don't often give the South African Mining Industries and the CEOs and the management, the sort of recognition they deserve. Listen, we've got world-class companies, world class. I mean, I'm probably so honored to work with -- every single one of the people who sits here in front and the tens of thousands that are on our minds and those that are here, and I'm proud as a South African. And I can say the same thing of so many mining companies that are world-class. So Eskom is one of those as well where there must -- a partnership we can do so much better. But it's not just about good talk and good hope and good intentions. Those sort of partnerships must translate into a Transnet that is efficient, effective and world-class. And I've got no doubt that there's a huge amount of commitment by all parties including the people at Transnet and of course, the same about Eskom. But it's not about the commitment and what you say is we've got to get the results. We've got to get results. The Rugby World Cup starts on Friday. When is the first match of the -- I almost said when is the first match of the Blue Bulls. When is the first match of the Springboks -- is next week? Well, anyway, I'll be attending 1 or 2 of them. But the point I'm making is -- if the Springboks play beautiful rugby, but they don't win, come on man, [indiscernible], you must call those [ trials ] and you've got to bring the cup home and for us as African Rainbow Minerals, we're going to have the profitability. We've got to bring the dividends home for our shareholders because part of being a globally competitive companies is dividends that are competitive consistently and the share price that consistently increases. And we're in the mining industry. It's a cyclical industry, there are good times and there are times when things are not so good. But the best mining companies in the world are those who even when the commodity prices are going down as we see now. And I've been at a lot of meetings where some of the most important people in China said the perception is that because China will not be buying as much as they have in the past, we should expect for the next 2 to 3 years, that prices at best will be consistent and more likely to go down. But -- this is where the diversified nature of African Rainbow Minerals. And as I said, in conclusion, just like the Springboks must got tries and the Springboks must bring the Rugby World Cup back to South Africa, African Rainbow Minerals must consistently pay competitive dividends and make sure that our share price consistently competes and does well, and bottom line is we're a globally competitive company. The last point is, again, on the factors that are outside our control, the one that's significantly more remote is the one, I spoke about. We have no impact on the price of iron ore, on the price of manganese, on the price of PMGs, those outside of our control. But what is in our control is whatever the price is to consistently be competitive and profitable, and to look at how we are performing in comparison with competition. And you can hire all sorts of things and say it's Transnet or its Eskom strikes, whatever excuse you can, but shareholders buy African Rainbow Minerals because they expect us to deal with all of these factors. The ones that are under our control, definitely. And the ones that are not under our control, including the ones that I referred to as low-hanging fruits and of course, we can -- we don't have a -- it's not under our control. But through our engagements and through the engagement of the industry, I think the industry is doing very well, the Minerals Council and engagement with the workers because you do need the workers on the site and the organization they represent the workers, bring them on our site. And of course, communities who live near the mines and make those communities benefit because -- they are an essential stakeholder, the employees. And I'm excited that in almost -- in most of our operations, the communities are shareholders, so that when things are good, they may share in the process with us. And when things are not so good, all of us feel the difficulties and the pain. I was amazed at 1 of my first meetings of the International Council, ICMM, Council of Metals and Mining, I even forget -- just now you ask me what does AMC stand when I say Anti-Natural Contract. But ICMM, anyway, so they've got CEOs of the largest mining companies in the world. And I was -- many years ago, I was quite surprised when they said, profitability, dividends -- all of those things, share price increase, is critically important. But the communities where our mines are our critical component. They've got a benefit. They've got to be part of what we do and that essential partner to our success long term. Okay. I think I can sit down, now a disclaimer. You've got the presentation. I'm just going to rush through it. And of course, if that questions. And Phillip will deal with a lot of the things as always in more detail because part of the focus of all of us during the difficult times is operations, operations, operations, what is under your control. And I'm excited because Mike is doing excellent work, Mike, Smith and Phillip and the team and they'll talk about what's happening at Bokoni and how -- what we used to talk about mechanization can increase profitability, efficiency and productivity, but also this whole thing about technology. I've been spending some time in Silicon Valley simply because you want to listen in here because everybody says technology is going to change, not just the way we live and work, but also the way we make profits and the way we run our businesses. So you go and sit there, to listen and to learn. And sometimes, if you sit too long there, you get so confused that you're actually smarter before the meeting started. They talk about artificial intelligence and robotics and all of these things that you've got to keep track. And don't see technology as a means of replacing our workers because we've got a duty to the employees and the workers of the company, but technology at the heart of it is. There are some places where workers should not be involved. And it's usually those places where it's not safe, was dangerous, should be no workers there because the lives of every single one of the employees is critically, critically, critically important. I almost said it's more important than profits, which is actually correct. We're a company that's committed to safety and health and side-by-side with it to being globally competitive. Okay. You can see that the group headline earnings are going down, and Phillip will talk more about those factors. And as I said, -- the ones that are outside our control, we should be aware of them, but even those function in a manner that makes sure that we are competitive down 21%. But listen we will always be in this industry. And you know what, you see what happened in 2021. You see what happened in 2022. Those days will come back. They have to come back, they will come back. We know that. And why do they have to come back? Because the global population is growing and the economies and we chose these minerals very carefully because these are the minerals that are required for the new economy for society, for community. So -- and I was told that shareholders are saying, why are you sitting on so much money. We're in a good position. We've got a significant amount of cash, but that cash is part of the investment in the future. And we've got to get the balance that we pay competitive dividends. You've got to pay a competitive dividend and side-by-side with them. You've got to recognize you are in a depletive industry. Your business is about taking out resources that it's not a farm where I can plant maize and come back next year, plant again and go back to the year. When those minerals are gone, they're gone. We need to find new minerals, replace them, new development. So I just want to say on the slide, the -- we're in this business for the long term. And we know that those days when we declare dividends that are significantly higher than what we are doing now, those days, we believe will come back. And that's why we're investing in the future. Next is a ARM Ferrous went down by 17%, André Joubert is doing excellent work, Dave -- David and [indiscernible] and the people we have at ARM Ferrous is world-class. Now in our coal, you never stop learning in life. But I'm happy to have ZAR 1.5 billion from coal. Thabang says black is beautiful. Green is beautiful. All the other colors are beautiful as well. But what is more beautiful is green is even more beautiful. Green -- the [ 100-value ] is still green. Somebody will say the 200 is now the new -- I don't know what color is it. But anyway, whatever color -- green also stands for a green economy. But bottom line is -- we had challenges in coal over the years as much as we had challenges with platinum. The main challenge with coal in the main was about the green economy and the transition, and we are deeply, deeply committed to adjust in a fair transition and we are deeply, deeply committed to fighting climate change or if you place it differently, working together to deal with the challenges of climate change, but this coal is a matter of economic viability and to keep the lights on and to make sure that -- because at the bottom of what all of us are doing have people's living conditions and standards of living. So we are happy that the money we got in coal, and we are committed to this just transition and I also want to thank our partners who are with us in African Rainbow Minerals because we are deeply privileged all of them, all of them Anglo Platinum, Glencore, Mitsubishi? Sumitomo, how can I say, I was with the CEO of Mitsubishi 2 weeks ago. Sumitomo from the beautiful country in Japan, beautiful Sumitomo so wonderful to have you. And also I saw excellent work our partners in Assmang. and Harmony is not our partner, Harmony is a company we've got an emotional history with, and I'm excited about what I see in Harmony on the copper side because copper is part of the future. And all of our partners, have I mentioned all of the them, Phillip and Tsu -- sorry -- Impala as well, lots of good money has been spent at Two Rivers, okay? And then the dividends per share, as you see that we could have paid a little bit more. We always want to pay. Listen, we are all shareholders. But -- and we listen to our shareholders say, you have to listen to your shareholders, whether you agree or disagree, you've got to listen and they are key -- and this is where we were because that seemed to be the average, the consensus position. And we've got a huge amount of cash and Phillip and Tsu will talk to that. And all of that is part of the investment in the future. Dividends we received from Assmang, diminished by 9%. I mean the Andre, David and [indiscernible] is not here tentatively good work and the rest of the team and Assmang, and also ARM Ferrous. And then Two Rivers, good work is taking place at Two Rivers. Dividends went down by 61%. This holding about hydrogen, green hydrogen, blue hydrogen and of course, copper and nickel are key as part of the future. And we are confident that PGMs will continue to be part of the essential minerals of the future. And then at Modikwa, we didn't -- they went down because the money there we're using -- Phillip, we're using that money there for Bokoni, which we think is going to be a world class. And then the participative business, the dividends went up by ZAR 1.2 billion. Safety and Health, Phillip will talk to that, just to over emphasize, the indicators are good. The health and safety of every single one of the employees at African Rainbow Minerals, key priority, top priority, primary objective. And then this is the strategy. Of course, as I said, just like the Supreme box beautiful strategy, but that strategy owner-operator entrepreneurial management, investing in our employees, partnering with competition and the whole issue of technology that commitment we have must translate in competitive returns. And then you see the importance of the diversified nature. If you look at financial year 2022, the PGMs contributed in 2021 when the price went up. I mean, rhodium went -- it went up significantly. I can't even -- the price was enormous and then it went down in -- but it's -- this is why you're in a diversified company. Some of the minerals and metals, which 2, 3 years ago were not doing so well, the indicators are manganese in particular and others is that there will be a significant increase in we expect the prices to increase there. And then our community investment very, very important. One of the things that makes me happy is ARM mining consortium, we paid ZAR 102 million. This is in -- this is the same mine where there are 5,000 people employed where 10 years ago, the issue was close the mine, close the mine, close the mine. And our commitment was, listen, we've invested so much money and we've invested for the future. It will be fine. So I'm happy that when I fly over those communities and I look -- and I remember what they looked like before we started is chalk and cheese -- absolute chalk and cheese. And you get so excited and so proud and thankful for the Thando and [ Wuxi ] and Thando and [ Wuxi ] and the team there great work, great work. And of course, all of us know that we can even do better. And then the responsible environment, as I spoke about, the carbon emissions and the water extraction, I mean the numbers are self-explanatory, million tonnes of carbon dioxide equivalent 0.88. This is part of -- my wife is now driving an electric car. Now I shouldn't say this because I'm old fashioned. I like the sound of vroom, vroom, vroom, all of these old cars. I'm not saying I like the smoke, the smoke I don't like. But I went to the Formula One and then there were discussions about Formula E. Now Formula E is the electric ones. The cash can go up and down, you can't hear them. But if you go -- you must go -- if you go to Formula One, I mean, that sound, we're just like, of course, the Formula One, they must make sure that there's -- like all of us, that has a huge commitment to 0 emissions, but something that we love. And then as I said, that slide. So I'm going to hand over to Phillip and now Phillip Tobias, for those of you who has archaeologically inclined as I am, one of the smartest, brightest archaeologist. So you have world-class, respected all over the world. His name was Phillip Tobias and he was the Edwards -- when I was a student of the Edwards, my wife always used to brag about you. And when I said to my wife, we've employed Phillip Tobias, kept quiet and she said, "My dear husband, did you say Phillip Tobias, she was thinking of the great Phillip Tobias, but he's going to be as great as the other great, can you clap hands for him please.

Thank you very much. Good morning, and welcome to those attending in-person and also online. And once again, just thank you very much, Chair. And the Board members that are in attendance. We know that some of them are online. Our JV partners, even as Executive Chair mentioned, we've got the members of Sumitomo with us and Assore and also we have the executive leadership team and management. During the past year, the industry had numerous challenges operating and managing low commodity prices, together with logistics, power, water challenges and above inflation cost increases. We once again realized the value of a diversified portfolio in a volatile market. You see how we benefited from coal, which in the past I mean we didn't really have that significant contribution. But I think the challenge at hand at this point in time is that cost reduction, cost containment remains a key focus. Productivity and efficiency improvement is an immediate area of attention and will continue to be driven by improving levels of mechanization, automation and the introduction of appropriate new technology and feed for Papua's IT systems. Very important, even as the Chair has mentioned, control things that are within our control, especially in the PGM space, the issue of enhancing quality mining to make sure that we improve our grades almost close to reserve grade and reducing waste and dilution it's an area that is really urgently getting our attention. The drop in both iron and manganese prices together with reduced sales volume. I mean, a lot can really be mentioned, where we're sitting, especially in the ferrous space, I mean we've got quality ore bodies Khumani, Black Rock and also on the manganese side, we also have a quality high-grade ore bodies. We have invested a lot in the past, and we have an installed infrastructure that is capacitated to deliver more than what we have delivered this past year. I mean if you look at the iron ore space, the installed capacity is around 16 million tonnes and we only delivered 13.2 million tonnes. And also on the manganese with the completion of the Black Rock projects and the Gloria projects, we have really capacitated that mine to can be able to deliver between 4.3 million tonnes and 4.6 million tonnes. But the operations this past year has really been constrained by the logistics challenges that we have faced on rail and also at port levels. And management to that extent is continuing to really work closely. We Transnet to improve that situation and we do believe that we will certainly be able to lend at some of the long-term sustainable solutions. In terms of the manganese alloys. I mean, we've experienced the high records that have already been delivered by Sakura, this year being what one can say, there were no challenges that we experienced previously. In the previous year, you remember that we've had a number of challenges due to transform [ fillers ]. So this year, we were able to perform and to deliver. And just high level on the PGM side, what really challenged us -- looking at both mines, Two Rivers and Modikwa, though there has been an increase in terms of the tonnages that we delivered; however, we, on both mines, we are really faced with the challenges of grades. And to that extent, we are really enhancing our quality mining. We're looking at making sure that we optimize our mining and also reducing waste dilution. The following slide reiterates the divisional headlines, earnings performance in addition. It also highlights the impact of the remeasurement losses in prior year of around ZAR 808 million, which relates to the ARM coal business. Going forward, since these loans have been repaid and settled, we do not expect to see such large remeasurement gains or losses. In terms of the EBITDA margins, I mean, you can see that on the EBITDA, we really have strong margins on the iron ore, coal and also PGM, even though there has been a regression from 55% to 42%. I mean those 3 commodities are still delivering on over 40%. However, manganese and manganese alloys have really been challenged, but manganese ore has been consistent if you look at what they delivered year-on-year. Looking at the variance analysis, I mean, worth mentioning that the Rand weakening or the currency weakening played its role in terms of really helping us to cushion the losses that were experienced due to the decline or reduction with our USD prices and also on the volumes. I mean you can see that we lost almost ZAR 1.5 billion because of the volume variances, as I mentioned. If you look at the volumes, you will see that, I mean, there was a regression from the 16 million tonnes that we did the previous year to almost 13.2 million tonnes. Also, what is worth mentioning from this slide is just the effect or the impact or the benefit of the investment that we've really made at Black Rock mine over the past 10 years. I mean that mine is well set, as I said, to deliver between 4.3 million tonnes and 4.6 million tonnes. And what have we done in that mine, basically to create an enabling environment for our employees, brought in things like your tipping places close to the employees and as a result, reducing your cycles of operation and improving productivity. And that was actually also evidenced from the manganese unit cost price that was actually just below the inflatory increases. And what manganese, I mean, that Black Rock mine in the previous year, you remember that it was also a staff within our stable with a minus 2% improvement when the others were actually on the increase on the double digits. Just looking at the iron ore business, I mean, I did mention that one thing that really separate us, which is our niche is the quality assets I mean, Khumani remains a Tier 1 asset with more than 20 years of life, high grade and low strip precious mine. But for the first time this year, I mean we basically only sold less than 12 million tonnes per annum. These numbers were never seen since over the past 10 years. So that really tells you the extent of the challenge that we are really faced with I mean M&A team from the first thing I think that we experienced last year was the Transnet employee strike that lasted close to 10 days. And subsequent to that, there has been other challenges, issues of derailments, issues of -- obviously, unavailability of low cost. But as I mentioned, I mean, we have really gotten closer to the management, and we are really engaging. And also the good news is that through our engagement even to the highest office in the [ land ], I mean, there has been an establishment of the National Logistic Crisis Committee. I mean a similar structure that has really been established on the Eskom side, and the intent thereof is to basically involve all the multi-ministerial teams and put the matters on the table. So that as all stakeholders, we can really engage and come up with a lasting solution for the benefit of the SA Inc. Regarding Beeshoek, a number of options are being reviewed to extend the life and to improve the cost proposition for this mine, so that we can really make sure that we optimize and unlock full value from that mine. And one thing that I also need to mention as I maybe go back to that slide, the Khumani achieved 5 million fatality-free shifts after approximately 8 years. I mean that really tells the story. That is not production at all cost, but as we produce profitably, we have to make sure that every employee return home safely on a daily basis. Looking at Black Rock, I did touch the investment that we have done. We concluded the Black Rock project in September last year. And just in June, we've just basically concluded the Gloria mine project as well. I mean at Black Rock, we spent more than ZAR 7.4 billion. And as I said, it was basically to modernize the mine, to create enabling environment and a lot is still expected from that. Obviously, something that we need to change is to make sure that we can really optimize the rail output and also where we can, depending on where the prices are, continue to basically track and make sure that, that mine can deliver. And this year, this particular mine has already set a new record by really achieving the new numbers, producing 4.3 million tonnes, even though we sold collectively close to $3.7 million tonnes this year. The mine is capacitated. As I said, we've made a worth investment and all that is left is to unlock it through making sure that the value chain is really aligned to sort of enable that optimal performance. And as a result, being able to position ourselves in the correct place in terms of the cost proposition and also the return on investment to the shareholders as well. On the manganese alloys, what is worth mentioning, we have also seen Sakura, as I mentioned, really achieving record performance and also reducing that debt by 77%, I mean this was at the back of the higher prices at the beginning of the year before we saw a sharp decline in that. But we are quite encouraged by the fact that it is in the right position and also set in the first quartile of the cost curve to can be able to weather all the storms and the challenges that are ahead of us, and exceptional operations and being powered through hydropower as well. Moving into the platinum space. You can just see the impact of the price drop, especially the rhodium and palladium, but also, I mean, even as the Chair mentioned, that being told, we need to look at what we can control. Something that is within our control is our cost. So we really have started really looking and identifying cost wastages, identifying opportunities through productivity improvement and also, I mean, countering some of the external factors that basically got us to where we are. I mean, we have had a challenge with regards to the explosive cost and above inflation, electricity cost increases and also the diesel as well. So these things are really receiving the attention. And the levers that we're looking at is making sure that we can basically deliver more with the workforce that we have so that we can dilute our cost structure and improve our profitability and our output as well. So we are quite positive, and we are quite confident that both operations are likely to improve cost position as above interventions are being realized. Construction of the Two Rivers Merensky plant and the UG2 mining is progressing well. So you remember that we are in the process of building that ZAR 7.2 billion Merensky mine. We are almost halfway -- so -- and are looking forward to commissioning the plant around Q4 of 2024 and really completing the project at the end of 2024. So we also are already starting to witness improvement in our resource development and that is really going to help the operation to create the requisite flexibility to improve mining volumes at both mines. So this is after we have really separated with the Redpath that was doing some capital development for us at Modikwa. So we're now doing it ourselves, and we started really seeing some improvements, thus opening up our ore reserves, so that we can really create necessary flexibility and be able to improve our productivity and improve our volumes, thus diluting our cost structure. In Nkomati, we have set in the past and is still the same. The status quo remains. So it remains on care and maintenance. And translating into the coal, the impact of coal prices are reflected at top left graph. Logistical challenges as well continue to hamper sales volumes and the same effort that is really being put on the -- on the iron ore and the manganese lines is also being put on the coal as well. I mean there's 4 basically channel optimization teams that have been set up, the one that is looking at Chrome, and the coal and also manganese and iron ore. And I mean, André Joubert is basically chairing and leading the manganese channel optimization team. And I think he's optimistically cautious that we are really getting on the right track. We are talking. But obviously, even as the Chair mentioned, the need we can't just talk forever. We have to really see action, and that action might be seen in results and bottom line impact on our bottom line. You can see how the stockpiles really grew because of the issue of the challenge on the logistics side. So we hope that with the improvement on the logistics will be able to run down those stockpiles. Unit costs will normalize as volumes improve and stockpiles are drawn down and all indications are that at least with what we have heard, there seem to be some bit of agreement between the government and the Chinese Rail company that really provided the trains that there will be some agreement and we'll be able to see some improved maintenance and repairs on the Transnet side. And obviously, other things, I mean, that's not the only thing that has to be addressed. There's quite a lot of issues that needs to be addressed. But the fact that we are sitting around the table and we're getting closer and are providing some input as well and some skills. I mean, that is quite encouraging. And we know that we do believe that through collaboration, we'll be able to lend where we are. In terms of the projects, talking to the completed projects. I mean we are in the growth mode, especially when you look at the PGM currently in execution, the Merensky and also Bokoni that is due to come, but we really pride ourselves with the excellent execution of the Black Rock and Gloria project. I mean that project was actually delivered on time and it was actually free from fatality and had a very good lost time in their frequency rate. And I've already mentioned, I mean, the benefit that we're already realizing from that project. Now what is left is make sure that we sweat the asset and really realize that return on investment that has been part of the investment case. Two Rivers plant expansion. This project was also concluded last year. An additional 40,000 tonnes of milling, especially as we transition into the low grade section of the business. Very important that we push the volumes, so that we can achieve and deliver the ounces expected. And then the future growth projects, as I mentioned, the Merensky -- the Two Rivers Merensky is currently in execution. And then in terms of Bokoni, I mean, ARM continues to be confident about the long-term profitability of Bokoni. Good progress has already been made in advancing the definitive feasibility study, which has been based on a phased development approach that to reduce peak requirements, funding requirements to optimize production ramp-up and also to minimize project execution risk. So that DFS also preserves the operationality to increase production to optimal levels, so that in the future, when we want to ramp up when the economic conditions are okay, we'll be able to do that with ease. So this DFS indicates higher capital cost relative to the 2021 investment case due to inflationary cost increases and also due to the enhanced scope definition. The project remains very robust and is expected to be attractive in terms of the industry cost competitiveness. And this DFS will now be advanced to bankable feasibility study, after which then it will be presented to the Board for approval. So we're still quite confident that it's a very robust investment proposition. And in closing, the key focus areas. Needless to repeat again, the issue of cost, very important to make sure that we have caused competitive operational performance, increase our efficiencies, our output more with the same so that we can really increase our margins, pursue value-enhancing growth opportunities, I mean we are in the growth mode. We're looking for opportunities. As and when value-accretive opportunities come, we have to review them and really take advantage and make the right decision. Containing unit cost escalation in line with inflation, cost, cost, cost forecast very key so that we can really continue to realize improved and better margins. Implementation of proven technology to enhance productivity and efficiencies, looking for appropriate new technology and employing it accordingly way to really help us to really enhance and deliver better volumes and outputs. Delivering approved capital projects in time on and budget, especially now that we are in the growth mode, learning from the lessons on the Black Rock what went well and also those skills. I mean, some of those skills have been redeployed to projects like Merensky Two Rivers, and we are learning also the lessons from that and incorporating that as part of the front-end loading for Bokoni. So that as we go into -- as we transition into the execution on the Bokoni side, we'll be able to deliver that project on time and also on budget. And lastly, very important, as I said, continued engagement with Transnet to implement sustainable solutions that are value accretive to all stakeholders. Thank you very much. I'm then going to hand over to my colleague, Tsu, to take over from here. Thanks.

Thank you, everyone welcome. Now at ARM, when we look at capital allocation, we prioritize investing in our existing business as well as paying down any debt we might have. When we look at investing in our existing business, we look at stay in business capital, alternatively, we call it sustaining CapEx. So that's what we mean when we refer to investing in our existing business. If you then go down on the slide, but these are not by order of importance, let me just note. We also look at investing in the growth of our existing business as well as pursuing mergers and acquisitions, and those are opportunities where it makes commercial sense. So these opportunities, how we look at them is that they battle it out for capital, where in a number of metrics are used to assess the different projects that are presented. And we look at a number of metrics such as internal rate of return, payback period as well as hurdle rates, and these are used to assess those opportunities. And then we look -- also look at returning capital to our shareholders, and that is in the form of dividends. As Chairman mentioned, with ZAR 12 dividend -- final dividend that we're paying for the full year, that comes to ZAR 26 per share dividend. And if we look at our dividend guiding principles, that is at the top range of our 40% to 70% range. But we also look at share repurchases if that makes sense at that time. So this slide illustrates how we generated cash and how the cash was allocated in the financial year. So we generated cash of just over ZAR 8 billion from the operations. If we look at it from a year-on-year perspective, this was a decrease of approximately ZAR 500 million year-on-year. And it also takes into account about ZAR 1.2 billion inflow that came from the realization of our trade receivables. If we look at the cash that we received during the year or the dividends that we received during the year, we received ZAR 5 billion from our Assmang JV, which is ZAR 500 million less than the dividend received in the corresponding period. We also received a dividend or a distribution of ZAR 1.2 billion from our Coal business as well as $17 million from Harmony. If we look at how these funds were applied, we paid out ZAR 6.7 billion to our ARM shareholders during the year. We acquired Bokoni for ZAR 3.4 billion, which is a ZAR 3.5 billion cash consideration we paid. However, there was cash that was already in the business of circa ZAR 59 million. So on a net basis, that came to ZAR 3.4 billion. And we also invested ZAR 4.5 million in capital expenditure, which was both expansionary as well as stay in business capital. If we look at it on a year-on-year basis that was an increase of about ZAR 2 billion. The lion's share of it relating to the Merensky Project at Two Rivers. If we look at our net cash and debt, total borrowings reduced by ZAR 242 million during the period to a balance of ZAR 242 million. The balance really relates to mostly our IFRS 16 liabilities that are sitting on our balance sheet as well as the loan owed by the ARM BBEE Trust to Harmony. This means -- and you can see it on the table that all in all, ARM has low interest-bearing debt, and we closed the year in a net cash to equity position of 18.1%. So if you look at our segmental capital expenditure, we continue to invest in our existing operations with segments of capital expenditure of ZAR 7 billion. The increase, as I mentioned earlier, mainly relates to the spend at Two Rivers Mine for our Merensky project. That project just in the 2023 financial year, we spent close to ZAR 2 billion. Also included in the ARM Platinum figures is ZAR 692 million spent at Bokoni CapEx. The majority of which was spent on the early ounce project. Now if we look at the years 2024 to 2026 included in those on Platinum figures is the capital expenditure for Bokoni, the guidance of which remains unchanged until the bankable feasibility study is presented to both for approval and then those details then are shared with the market, which we will do in due course. Thank you very much.

Thank you very much, too. We only have three questions from the webcast, so we'll go through those quickly, and then we'll take questions from the floor. The first question is from Lisa Steyn from News24. The question is directed at the Chairman. So I think I'll just give him a second so that you can hear it.

You said there are only three questions.

Only three questions by the way. The first one is for you, Chairman. That's why I waited for you. I think you need to hear it.

For me?

Yes.

But you are the Chairman.

So Lisa Steyn says, hi, Dr. Motsepe. Do you support Minister Pravin Gordhan's recently announced review of Transnet. Do you think he's [indiscernible] zeroes in on all the right issues? In particular, do you think a review and a possible overhaul of Transnet executive management is key to turning around performance?

Okay. What is question number two?

The second question is from [indiscernible] Capital. Good morning, Chairman and the team -- and the team, Chairman.

So it's for the team.

You don't have to field all of them alone. Would you consider joining the global lithium rush going forward? And the last question is from Sandile Magagula from Umthombo Wealth. He's asking, what informs your higher iron ore export volume guidance from 12 million...

My apologies. Just repeat that question, sorry.

The last one or the second one, Chairman? The lithium one?

Yes, the lithium one.

Okay. So that was the question from [indiscernible]. He was asking, would you consider joining the global lithium rush going forward? And the last question is from Sandile Magagula. And he's asking what informs your higher iron ore export volume guidance from ZAR 12 million to ZAR 13.2 million in 2024? Modikwa and Two Rivers have always struggled when it comes to unit cost increases, could further underperformance at these operations lead to corporate action? Those are all the questions from the webcast.

Thank you. Thanks, Thabang. André, will you take the question on iron ore and what's his name? Thando, would you take the Modikwa one, okay? Thank you. Can we start with you, André?

Yes. Thank you for that question. I think it's a combination of a few things. The one is the Transnet that is struck the previous year, and that was included in the poor performance of Transnet. The impact of that and a very slow ramp-up to the full -- to come back into production again. The second issue is that we moved the Transnet allocation from Beeshoek Mine. We moved that over to Khumani Mine. And you can just do a simple calculation. There was 350,000 tonnes a year allocated to Beeshoek. But the train -- the weight of the trains were only 65 tonnes. Now we've diverted those trains to Khumani Mine at 100 tonne per wagon. So just that gives us about almost 200,000 tonnes a year extra. And then also with deep engagement and involvement with Transnet and the iron ore producers, we participated in the planning for the shutdown. We also participated in a process what they call tamping. We assisted Transnet in getting that tamping machine in place. We're going to -- now in October, we're going to go for a 10-day shutdown. And during that shutdown, there's going to be a lot of work done, and we're doing and assisting and working with Transnet in terms of that planning. So the outcome of that is an objective that we have is to the areas where there's currently speed restrictions due to the condition of the rail and the sleeper network, we're going to fix that, and we're going to lift majority of those speed restrictions, which will improve the overall cycle time, which will -- currently, as we stand now, the execution -- the plan that Transnet has is 35 train slots per week on the iron ore side, and that's going to go -- that's going to increase to 38. So that, combined with the other factors. And this is based on real planning and is the element that's going to give us that improved performance. And it's also in terms of our partners, in Transnet and also my fellow iron ore producers, we're all in agreement, and there is a concrete and definite plan on that. So it's not just wishful thinking or good luck story. It's real actions that's going to be placed -- put in place. And I'm pretty confident that we can achieve those targets. Thank you.

Thank you. Thando?

Thank you, Chair. Good questions from Sandile [indiscernible]. As Phillip highlighted, our forecast is on cost reduction at the operations. if I may paint more color in terms of the cost contribution increases as well what we're doing about it, starting with Two Rivers. Two Rivers, you will recall that we have been raising the issue in terms of the split reef and the trade reduction that it put about. As a result thereof, we justified and got approval from the Board to invest more million capacity at 40,000 tonnes additional capacity, as highlighted by Phillip. Quite pleased that, that million capacity has been commissioned and is operating. However, when we were commissioning that capacity, we didn't have Eskom power. That power, we only got finalized in about 2 weeks ago. And as a result thereof, there has been an additional pending of diesel contributing in a region of ZAR 110 per 60 ounce into our costs. So we should see that cost coming off going forward at about [indiscernible] reducing by ZAR 80 to ZAR 90 per 60 ounce. In addition, at Two Rivers, we have now transitioned to an undercut mining as a result of the split reef. What we have seen, particularly in the last quarter of the previous financial year is quite an improvement on the trade, and we're going to stay in that undercut going forward for most of our stopes. I think those two are going to contribute in terms of arresting the cost increases that we have seen. Modikwa, slightly different challenge. A year ago, we approached a contractor to assist with the development. However, that contractor highly underperformed, resulting in us terminating the contract. As a result thereof, we had to take over the machines and paying in subassembly. So we had quite a huge contribution on costs in terms of paying in the subassemblies and running the operation ourselves. That again should normalize going forward in terms of our production. Phillip also highlighted the issue of the credit, which is what we are focusing on. However, let me hasten to remind everybody that Modikwa in a previous year, our cost increases were well below inflation. They were sitting at 3% as a result of the interventions we've got. I do believe that, again, going forward, we'll be able to manage those cost increases to be within the norm of the industry, given, of course, the hyperinflation we see on diesel, explosives as well as an electricity. Thank you, Chair.

Thanks, Thando. Phillip, do you want to add anything to those two remarks?

No, Chair. I think just to add on what Thando is saying, I mean, for the PGM business, flexibility is quite key. At any point in time, you hit the portals -- geological features. So we need to make sure when we have that, there's already spare areas available for our crews to mine. I mean those employees highly motivated when you give them a work in place, they really make sure that they do their level best. So very important that, as a leadership, we continue to focus on the inputs in terms of working areas, in terms of making sure that those crews are full and that they're getting the equipment that they need so that they are able to deliver, thus unlocking full potential and reducing that cost -- high cost base and making sure that we move down the right position in the cost curve. Thanks, Chair.

I mean just two quick issues concerning Transnet. I think the same principle applies Eskom and any other parastatal. And for us in the private sector, the principle of employing the best skills and expertise, the best persons for the job is nonnegotiable. Absolutely, absolutely nonnegotiable. And there's absolutely no conflict none whatsoever between employing the best people for the job and making sure that side-by-side with that, we've got the best women in the most senior positions, not because they are women, but because they are the best. You've got young black and colored in Indian and white South Africans occupying senior positions, not because they are black or Indian or colored or white, but because they are the best for the job. And again -- and there's side-by-side where that goes this huge commitment in terms of our recognition for the composition of our country. We've got a vast number of black majority. And as part of this inclusive leadership, you'll have the best across the board. You'll have the best black South Africans. You'll have the best white South Africans. You will have the best Indian and colored South Africans. So I just want to conclude by -- we can't be experimenting. There's no time to be playing around and fidgeting and say, but you're such a smart, bright young person. Your experience is questionable, but you're smart and bright, and you put the person in a position -- in a leadership position, which requires 5, 7 and sometimes 10 years of practical experience. So I'm an excellent, I don't know, I'm an excellent -- let me make a bad example. I'm an excellent doctor, I'm a dentist or maybe I'm an excellent dentist, but I'm [indiscernible] a doctor. So I'm an excellent financial person. I'm an excellent CEO, but I don't have experience in the mining industry. I've got a good track record in the retail industry or in the -- in various other industries, but not mining industry. The best people in any industry are the ones who have grown up in the business and understand the business. So I just want to say in conclusion, I want to go back to what I said. Part of the concern on government side is, guys, listen, why do you go into the public and criticize us. I mean, I have to be criticized, and I deserve to be criticized all the time if interventions I make don't result in the appropriate results that we need. So it's part of leadership. But the point is we don't have time now. What we need is results, results, results. We need results at Transnet. We need the partnership to deliver. So I just want to conclude by saying that I'm very happy if you hear what André Joubert said that the discussions with Transnet reflects a deep commitment on the Transnet side and on the Board side and on the new restructure Board and the people. So that's an excellent beginning. But like all of us, whether you are in Transnet or Eskom or you are at African Rainbow Minerals, it's not a good idea or even the good plans or the wonderful restructuring or the new management you bring in place. That's important, but what's more important are the results, the results, the results. So let's give these guys a chance and support them and cooperate with them. What I like is what when I have my management team come and tell me, and André and Phillip comes and tells me, it's -- we're making progress because that's the bottom line. I can't give you dividends from the air. Dividends are the money that's in the bank. So the partnership with Transnet for the whole of the industry and any other partnership must translate into results and dividends are part of results. The lithium issue quickly. I mean everybody is running and chasing after the lithium and copper and nickel. What people don't know is that we've been chasing after these things for quite some time. You don't talk about things unless you've got -- you've concluded a transaction. And the big danger is, sometimes people are ridiculously excited about what they perceive to be the EV or the batteries potential and they pay excessively higher for lithium deposits than what should be the case. So I just want to conclude, from an ARM perspective, our policies, we only talk about transactions and deals when they are signed and sealed and delivered. Part of our commitment to the green economy, the hydrogen economy, I don't know, the blue economy, the minerals of the future, that's a key, key. And that's partly why we asked Mike Schmidt, and I'm excited. His passion and enthusiasm excites me because in companies, you've got to be careful because sometimes you've got a CEO who is a visionary, is a dealmaker, but is not so good operationally. And sometimes you've got a CEO who is good operationally, but doesn't understand that you've got to grow. You've got to acquire these minerals [indiscernible] mine, they get depleted. So I -- we are looking at lithium. We are looking at -- I mean there's some good work that's been done. André, you bear over the years and his team, I don't want to mention names. I mean there's some very good work that has been done over some time as part of our strategies for the future. But you only make announcements when the timing is correct and when we have concluded the right deals at the right time. I went to Papua New Guinea, not just because ARM is a significant shareholder in Harmony, but also because I'm Chairman of Harmony, but also because I'm excited with what I -- I was there 10 -- many years ago when we started. But I mean, the copper is interesting, but I promise people are paying crazy monies. There's an opportunity in -- we recently participated in 3 opportunities. We were invited, good opportunities. But the money that some of the people are prepared to pay doesn't make sense. And the beauty is we are not desperate. We don't have to conclude transactions for the sake of it. Anyway, are there any other questions?

There's 3 more questions from the webcast, Chair. So the first is from Shilan Modi from HSBC. He is asking question number one to Phillip. What are your priorities for the next 6 to 12 months? Do you think there could be a change in strategy? Or are you staying the current course? Shilan's second question is, team, you've cut guidance quite materially across multiple divisions versus 12 months ago. You're still guiding to volume growth from the new base. What plans are you implementing to deliver these growth targets, specifically on iron ore and at Two Rivers? Have you rightsized your assets for the lower volumes? I think Thando and André have already answered those questions. So we'll just stick to Phillip's question.

André, you agree with you think you've answered that as well?

Yes.

Yes. But a question that's not nice, sometimes you must answer it twice.

The next question is from Martin Creamer from Mining Weekly. What is ARM achieving on the renewable energy front? How many green megawatts are on the radar for ARM? And how much money do you estimate you'll be able to save by using renewables? What renewables deadlines are being set? What other [ keen ] energy plans do you have? And the last question on...

Okay. Just before the last, Mike, you will take the renewable and then you will deal with -- okay, what is the...

Okay.

Yes -- Sorry, Betty, take as many questions as they are because Betty is worried about the time and the interview and of course -- sorry?

[indiscernible].

Are there questions here?

Absolutely.

Yes. But people who see you don't ask questions. Thank you for reminding us. We will take questions here as well. And Mike -- sorry, Phillip and the team, the whole of the team will stay behind when the presentation is over and Thabang deal with -- there's usually one-on-one and there's interviews and they'll be available. Just the last question.

The last one is from Thobela Bixa from Nedbank. Question one, any particular reason for the lower lump-to-fines ratio?

Sorry any reason for the...

Lower lump-to-fines ratio.

Lump?

To fines. So that's in iron ore...

Lump to fines, sorry.

Yes. And then question two, how much of the manganese volumes did you track? I think after these questions are answered, we'll take questions from the floor.

Yes. Okay. So we'll start with Phillip.

Thank you very much, Thabang. The question in terms of the priorities in the next 12 months, I think, firstly, just to affirm and confirm that ARM has a very robust strategy as is, I mean, to deliver competitive returns and create sustainable value for all stakeholders. If you look at the quality of portfolio of assets, I mentioned earlier on high-grade quality ore body on the iron ore side and the manganese. What have we done? We have an installed capacity, but there is a gap in terms of delivery. The number one priority is to make sure that our iron ore business and manganese develop -- basically deliver to full capacity. And I did mention that we'll basically take engaging and lending on a sustainable solution in as far as logistics is concerned. And on the PGM side, it's about realizing and sorting those assets as well. At Two Rivers, Thando mentioned, we are on the growth. We want to see that mine growing to 0.5 million tonnes per month, thus basically making sure that it's in the right cost curve. The cost competitiveness very important that we get into the right position such that even as the prices go down south, we are able to sort of have margins and be profitable in that. And then the Bokoni Mine project, also very important that we bring it to closure and get into execution so that we can really realize the value that you want to see. And as we mentioned with other minerals and commodities that we covered like copper, those assets, it will depend on opportunities that come our way, not growth at all cost. It must be value accretive, in line with our investment propositions, investment metrics. And when that thing really goes there, then we'll be able to unlock that. So there is that flexibility on the balance sheet to make sure that at the right time, right opportunities, you're able to do that. But the strategy, there's no U-Turn. We just continue to build on that because we've got quality assets, quality people, and then we just have to maximize and [ swap ] the installed capacity that we have at this point in time and unlock full value for all stakeholders. Thanks.

Just -- I mean Phillip says something important. We don't wait for people to bring transactions to us. The point you make is very important. We actively go and engage and pursue, and -- so it takes both ways. And I mean, some of the best deals have come to us because people have come to us, partners have come and so that we want to partner with you. You are the best. And so part of growth at the heart of it is an active engagement. And -- so historically, we had -- we actually had a department that was focused on that. But we are not an exploration company. The exploration companies are best between exploring the juniors. But other thing that's just important that Phillip said is that we've had a strategy when Andre Wilkens was CEO, many, many years ago. And then Mike Schmidt and now Phillip. At the heart of what a team does is to continue the strategy that has been formulated many, many, many years ago. It's not -- so when Phillip talks about U-Turn, he talks about U-Turn in rugby where you go forward and you've got to come back, I don't know. So for us, it's 100% correct. It's part of not just developing strategies, but assessing them all the time to see the strategy we formulated and the investment we made 3, 5, 7, 10 years ago, is that still appropriate? And this is where the U-Turn is crucial because you don't fall in love. You can't fall in love with the mineral ore deposit. That's why commodity is on care maintenance because the circumstances demanded that. So I mean, the priority is that -- I think there's a nice slide there Phillip, where you presented what you identified as your key focus areas. Okay. All right. Mike will be the last on the renewables. André, you and Phillip -- you and Thando [indiscernible].

Yes. There's one question still for me on the iron ore ratios. Lump to fines.

Lump to fines, okay. So -- Okay. Mike, you want to proceed and then we'll go over to...

[ Martin ], thanks for that question. In line with many of the other companies and the industry at large, we, through ICMM, have not only supported but endorsed all the requirements of green carbon emissions on our route to net zero. To that effect, ARM has already gone public as early as 2017, in which we put metric targets and actually incentivized management to achieve those targets. Our Executive Chairman earlier on put up what we have achieved in last year. 4% reduction in carbon emissions or carbon equivalent, but that is the tip of the iceberg. So we review those targets every single year. We've just come off an intense involvement with the operations and training and giving a training and understanding of what we can do. Now obviously, we do all the right things from energy efficiency and being a responsible citizen. You would have seen in the last 6 months, we announced the 100-megawatt intervention on solar, which will go a far way to help the platinum operations, not only use -- reduce the electricity consumption, but what's hit them very hard over the last couple of months is the power and the power disruptions. And we know that diesel costs, excluding the capital component, is other than being dirty, but it also runs at 8x the cost of electricity, which in itself is quite prohibitive. Pleasingly, we do this for business reasons as well because that would make not only a big dent in carbon emissions but certainly drive us down the cost curve. The -- all the mines have got a commitment to move from current underground diesel and surface into more energy-efficient battery electric. The Northern Cape is quite advanced, particularly the underground Black Rock has done that. So these pathways, Martin, have and are being identified. Management is an operations incentivized to meet and beat those targets, but it has to make and it does make good financial and operating -- an operating sense. We also -- so we have definite pathways in place. You can also see that on our website. And when we publish the new one, you'll see quite aggressive enhancements to further reducing greenhouse gas on our route to zero. Thanks, Martin.

Excellent. Excellent, Mike. I know we're running hopelessly out of time, and they were just reminding me, we literally have 2 to 3 minutes left. We want to take some questions. André, can you just quickly respond to that question?

Yes. Thank you. On the question on the fines to lumpy ratio, our target is 55% -- 56% lumpy and 44% fines. And if you see a deviation on that, it's typically to do with 1 ship over the year-end, whether it was a lumpy ship or a fine ship. So there's no fundamental change in our lumpy to fines ratio going forward. And so we're still guiding at the 56%, 44% lumpy fines ratio. And then the other question that was asked is about the tonnes of manganese ore that was [indiscernible] last year. That number was 348,000 tonnes. Thank you.

Okay. Now we have to take questions here. We've got serious time constraints. We're going to go boom, boom, boom. So it also means your questions must be boom, boom, boom.

Okay. Thanks. Nice easy question.

I know you and you've lost a lot of weight. So just introduce yourself and tell those who are you and where do you come from?

It's Tim Clark from SBG Securities.

And tell what the SBG Securities stand for.

Standard Bank Group Securities.

[indiscernible] is going to be happy, you said Standard Bank.

He's happier when we say SBG Securities.

I'm going to tell him he must stop being happy for SGB when I see him again and say Standard Bank, continue.

You've established a net cash position, and it looks like you're hovering around ZAR 9 billion to ZAR 11 billion. Is that a kind of comfortable place? It gives you lots of flexibility. It gives you lots of security. Can we assume that that's a comfortable place? Or do we assume that maybe if this excess cash you continue building cash reserves, if there is excess cash?

Very good question. You've heard of what's called lazy capital, lazy balance sheet. And I shouldn't say this. There's nothing -- let me contradict myself. We always -- in fact, let me leave that and go to the mine industry. I was -- one of the top businessmen in the world said always make sure you've got some cash on the sideline that is in the world, because at times, some of the best opportunities present themselves when you last -- you least expect them and you must be in a position to take account of them. We don't like to have money that is not specifically earmarked for a specific transaction. If anything, we'd rather give it to the shareholders. And let them -- they know better than we do what we should do with their money. So -- and the problem is our cash reflects our current position. And you will have noticed that we said that the Bokoni transaction, because of inflation and because of various other things, has been a little bit higher. But I can show you -- I mean I'm so proud of 2 that there's an obsession with -- we don't want money lying around it hasn't got a clear specific defined objective. And right now -- and the last thing is, we'd rather increase the dividends to give it to shareholders. What's the next question? And as I said, the team is here, and we'll deal with whatever questions are left. I saw another hand. Has anybody else -- so please go ahead. Has anybody else got another question. Okay.

My name is [indiscernible].

[indiscernible].

[indiscernible].

[indiscernible].

I actually had two questions, but I think the first one might have been answered, but let me just ask it anyway. So the first question is, would you consider investments in solar panels for generation of power as other like mining companies are doing, your competitors, I don't mention names, that's the first question? And the second question is, Chair, you spoke a lot about costs that are out of your control, right, that are affecting. So would you consider other forms of financial investments to cushion the risks that are within the mining industry that are not in the ARM's control, such as lending, more investment in bonds and other financial products?

Thank you. Yes, there's another question here. Let's say, we should take all the questions. Yes, go ahead.

Thank you, Chair. It's Leroy Mnguni from HSBC. My first question is on Bokoni, the project. I appreciate the feasibility is still ongoing. I was just curious because [indiscernible] concentrates, I believe, should become available next year. Is that something you could potentially use as part of the solutions of maybe postponing some of your medium-term CapEx there and maybe creating a bit of flexibility? And then on ARM's Wafi-Golpu project and maybe this is for you...

Sorry, Harmony.

Harmony, sorry. Harmony's Wafi-Golpu Project. Their partner, there's a bit of M&A that's happening there. If that was not considered key for their portfolio, would ARM be interested in partnering with Harmony in developing that? I'll stop there.

Good question. Any other question? Yes.

My name is Phumzile [indiscernible] Water and Environmental Services as well as [indiscernible]. I'd like to ask for the ways of submitting -- seeking opportunities, tendering with because for the past...

You are seeking opportunities.

Yes. How we will go about because we have registered on the database via submitting their form as well as making calls, but the response is -- we need to keep on calling. So it's been like 2 years now...

Phumzile, I'm very proud of you. Very good question. So we'll arrange that one of our senior person stays behind with you. And if they don't -- it doesn't mean that they'll give you business, but if there's no progress, you will tell them the next presentation, I'm going to go back to the Chairman. Okay. Any other question? Any other question? Thank You. So it's -- that concludes those questions. Now quickly on Harmony, I'll deal with that quickly. We don't talk about transactions of whatever nature. We -- something I learned more than 30 years ago very early on, where I come from a culture where they talk about transparency and everything. And this is an instance where transparency can be complicated. You tell people I'm negotiating with Anglo American to buy a mine from them, but we are still negotiating. And then somebody else came and paid ridiculous money for it. And the advice from our side was if they are prepared to pay so much money for it, you should give it to them. So any transaction with any company, Leroy, is something that we consistently look at and at the right time, we'll make announcements. What was that -- the other, yes, quickly, Thando, Bokoni?

Thank you, Patrice. Leroy, in terms of, as we said, the feasibility study has just been finished now. We are looking in terms of the procurement side to come to the bankable feasibility. And of course, we're looking at [indiscernible] to see what options and resources that are available in terms of procuring those. So we'll definitely evaluate that and see if it makes sense for our business. Thank you.

Okay. Is at all?

There's a question from other gentleman about alternative investments...

About what?

Alternative investments. I think you should...

Yes. They'll answer those alternative investments. We're going to stay behind and answer that. That's an excellent question, and we'll deal with that, okay? So Tsu is our expert, will engage with you. Thank you so much. We are most grateful and thank you so much for coming and look forward to seeing you. Can we clap hands for everybody who is here.