Atalaya Mining Copper, S.A. (ATYM) Earnings Call Transcript & Summary

Good morning, and welcome to the Atalaya Mining Plc Annual Results Investor Presentation. [Operator Instructions] The company may not be in a position to answer every question received during the meeting itself. However, the company can review all questions submitted today and publish responses where it is appropriate to do so. Before we begin, I would like to submit the following poll. And I would now like to hand you over to CEO, Alberto Lavandeira. Good morning to you.

Many thanks. Hello, everybody. Good morning, everybody. Thanks for being with us. Again, I have with me the CFO, Cesar Sanchez; and Michael Rechsteiner, Head of Corporate Development and if needed, they will also be available for -- to help respond to some questions. I'm going to go through the presentation of our results, which will include the main results of the last quarter of 2023 and the first quarter -- sorry, in the full year. And that will also give a bit of highlight of how things are going and the forecast for '24. '23 was excellent year, I would say. It was a positive year with, let's say, recovering back to more or less normal conditions from the operating cost point of view. We produced 99% of what we produced in the previous year. And we did so even with slightly lower grades than we had in the last quarter, which are already were planned to be there according to the mine plan before we start getting the recoveries of this grades up but we processed 15.8 million tonnes with good recoveries of 86.6%. So we achieved cash cost of slightly less than $2.80/lb Cu and All-in cost of $3.09/lb Cu. This is consistent with the guidance. And I would have to say that this is -- these are quite remarkable good costs when you consider the type of grades we were able to maintain the cost -- unit cost per tonne well under control. This is basically due to the lower electricity prices. And of course, we had other -- these lower electricity prices have an effect in other things like [ balls ] and the price of lime and price of [indiscernible] . So the whole thing flows down. On the other hand, we had some higher costs, higher cost in mining, not because our unit costs were higher. Simply, we had to move a little bit more tonnes or tonnes that we will not have to move simply because we need to move tonnes from the existing Cerro Colorado pit, so that we could move our key equipment, the contractor can move the key equipment into the stripping of San Dionisio, which has already started. San Dionisio just to remind you is an area with much higher grade. Well, with all these operating parameters went reasonably well, we had an EBITDA of EUR 73 million, which is higher, almost EUR 20 million higher than the previous year. Mainly due to lower operating costs, cash flows were also higher. And we invested this extra cash flow produced from operating activities in a prudent way so that we could maintain our free -- our net cash position under control, and we invested that in building E-LIX and also building the solar plant which were EUR 18 million, EUR 1 and EUR 12 million, EUR 13 million in all, so basically around EUR 13 million. So with all this considering that we are -- things are going as expected and the operating costs are under control, the Board decided that we have a good financial position. The Board decided to give a final dividend of $0.04, which basically tops a little bit what we had already. So it's slightly around 20% higher than the previous year. But that was not only that. I mean, we had lots of other things going on. We continue with our plans to move away from aiming to the main market. And this is all the papers are going. We have slight delay due to our last attempt, but pretty close to Christmas and year-end, but finally, this thing seems it's going to be happening in the first weeks of April. So only 1 month from now. We also proposed re-domiciliation from Cyprus to Spain, which was basically will allow us to be included in main indexes. And since we didn't have -- we didn't have any liquidity in Toronto, we decided to cut costs there and to remove the listing in Toronto. So right now, we're basically will be listed in the main market starting in April. The Board, we continue to reinforce the Board. Neil Gregson was appointed a director but also -- I mean, lead director. But we also continue to reinforce the board basically to fulfill the conditions set by the new main market listing and we will be strengthening the Board in the next months with new independent directors. Although our Board right now is basically formed by independent professionals. From the asset point of view, we saw the first copper cuts coming out from E-LIX, although these were only a small amount during the startup of the commissioning of this plant and the plant continues to be under construction. Right now, they are leaching with zinc. We also started moving the waste in San Dionisio in order to get to the ore as possible. And also equipment has -- mining equipment has been ordered and is about to arrive to this to be able to get this additional waste movement. And from the permitting point of view, we continue advancing in Touro. We got a permit to extend the mine life of Rio Tinto including a huge tailings expansion, which will give us a space for the extra tonnage mine at San Dionisio. And we also got the mining permit for Masa Valverde, which means we will likely start at the end of the year a ramp to access the higher grade as closer to surface. From the sustainability side, we continue to set strong targets. We advanced the construction of our solar plant, which is -- there is some delays there, but it's going to be up and running in the second quarter of this year. And of course, we continue with the water treatment plants at Touro, which are key to get the permits. And of course, we publish a new sustainability report and the next one is going to be coming out soon. We are already seeing some draft and it really looks very professional and very nice. So going to the details of those, I mean, most of it has been already explained. But I think the graph explains very well what happens. I mean you see in the graphs on the right side, you would see that we pass more tonnes, almost a record. Remember, this plant was supposed to be treating 15 million tonnes, and we have been able to treat 16 million tonnes equivalent, so the plant is running well. The recoveries in the last quarter was slightly lower due to the lower grade and production was similar to previous quarters. But since we had some good production in the second quarter, the overall for the year has been quite constant and you see that the revenues are similar to the previous year. So basically, although the copper price which is slightly lower -- sorry, production was slightly lower, the revenues were basically the same. EBITDA was slightly lower in the last quarter. But overall, in the overall, in the year, you will see later that it has been better than the previous year. And the net cash position stayed very similar to our previous levels, even having invested around EUR 50 million in this quarter. And our profits, as I said before, were similar to previous year even with this low quarter. Coming back to the whole year, revenues were slightly lower due to lower copper prices and slightly lower production, but since we have much lower operating costs, we had a better EBITDA and better profits. And much better cash flow and it allows us to continue investing, investing in the operations and in the future. And we still kept a very good cash position at the end of the year with around EUR 120 million and a net cash position without any net debt of EUR 54 million. Working capital has gone down a little bit, but that's simply due to the -- our short-term debt. It's a mixture of short term and medium term debt; medium term meaning 3 years and depending on the maturity of that debt, which normally we can roll because there are U.S.-revolving facilities. It doesn't -- it doesn't mean too much. But it shows that our financial position in the last 3 years, in spite of this high cost have been -- high cost structure have been maintained quite well while we continue to invest and this is fully disclosed in Slide 10, where we show the costs in a quarter and a cost for the full year. Second column from the right, you will see the year '23, what we are discussing compared to '22. The main difference, as you can see, is much lower cost from processing. That's mainly due to electricity but also due to lower line costs, lower steel balls, lower [ things ]. Other things like mining is slightly higher due to the, as I said before, moving more material in order to get to the better grades of San Dionisio and overall, lower site costs. The rest of the things like freight and off sites are quite similar to previous years, slightly lower, but we expect to see much better cost in this next year. We will go later with the guidance and there are reasons for that; treatment charges are falling down, freight, it's flat to going down. And we also expect to see lower inflation in other parts. Corporate costs and the rest of things are very similar. The main question here is much higher in capitalized strip and this is due the starting the activities in San Dionisio. This is as expected. As you remember, there was a plan to mine San Dionisio and Cerro Colorado simultaneously. And the first movement of material was going to happen in '24. We accelerated that a little bit because we wanted to see if we can compensate the slightly lower rates that were predicted in this year as soon as possible with the higher rates that are going to be fall on the San Dionisio pit. Overall, there's an important reduction in all-in sustaining costs. I should probably remind here that our -- within our capitalized stripping within our mining costs, we have the cost of the contractor includes the purchasing of equivalent purchase, the replacement of the mining fleet. And this is very relevant since, for example, just to get to San Dionisio area, the contractor is buying -- has already ordered and they are arriving five new trucks, with much larger size, 50% larger capacity and an excavator that's double the size simply to expand. And this is totally out of our cost. So within the cost of excavation, those costs are included and you don't have to account in addition to that for the purchase of a new mining fleet. Most of these good results, as I said before, are due to the lower cost of energy. You can see that 2023 has been much lower than the horrible year '22. But I think the important point here is also to show that '24 has already started in a very good mode. We have had around 2 months where the prices have been around EUR 50. So well within the prices in the long term. And remember, as a reminder, that we have hedged, we have covered around 30% of our production for the future. And those prices are around the EUR 50s plus the solar plant will provide price much lower. So our future costs will be similar to what we had in the base 2021 or even '19. So that's a big part of the equation that gave rise to much higher costs during '22 are -- I believe are gone. Just to compare with peers into the industry, and we always do that not to show ourselves versus others, simply to show that due to the way of reporting that some people do not include in the C1 costs, the mining cost, the capital required to replace the fleet in the mining costs. Our C1 costs are normally higher than average, but later, the difference between C1 and all-in costs are much lower, which means you can see there that despite the big increase in the left side of the columns, the increase in cost that we saw in '22 due to the electricity prices. Since then, we have been able to control the costs and to keep them well within the industry average, which I think is relevant. Because then what matters is not the C1, it is the all-in cost. You always need to replace fleet and you always need to do work, ongoing work in your minds. So with that, how is '24 looking? Well, we expect to produce more or less the same ore. We expect to process around same thing, 15.5 to 15 maybe a little bit higher million tonnes through the plant. The copper grade, it's going to be slightly lower in the first part of the year, but higher in the second part when we access the higher rates of San Dionisio and recovery rate, we also expect it to be around 85%. With all these parameters, you should expect a transitional year, a year that we'll have around -- also around 52,000 tonnes of copper, similar to the previous year, with cash cost, I would say, very, very similar to what we had this year. With that, of course, depends on the copper price, which so far seems to have started and I would weigh, our EBITDA should be equal or higher than previous years. And the extra cash flow where we will use it, well, we will use to finalize the solar plant and E-LIX not because there are new investments, it is simply they are investment coming from previous year that are rolled to this year. But the main thing is to move the road and relocate the electric line and so on at San Dionisio which takes most of the investment. Part of this will probably be going into '25, but most of it is going to be done in '24 because we need to get to the better grade sooner rather than later to benefit from the higher grades and to be able to get lower costs. So in addition to that, within our normal investments, we continue spending around 5 million to 7 million into exploration, probably a bit higher this year. And of course, this can change, if we have a discovery we'll devote more money for that. So for those of you that are not familiar why we are pushing so hard in San Dionisio, it is because the resource grade is basically double than what we have. In the picture you have in the center, you will see the bit of Cerro Colorado, which is the one that we are mining right now. There you see two things. You see in the far right, you see we are advancing with a pushback. You see that there's a new area there that needs to be taken down in order to access areas of the north and the south -- sorry, in the East and the South. But at the same time, we will see in the first part of the picture that the machines have already started pushing in San Dionisio. And this picture actually is likely old because it's already advancing very well. Things that you can see in the picture that I'm showing now on Slide 16 is several things. In the far end, you see a whole gray area, that's the solar plant that you can see basically covered already with panels. And in the bottom left corner, you see the E-LIX plant in blue is the thickener of the tailings. E-LIX is important because normal differential flotation applied to polymetallic sulfides. And a part of that will give you recoveries of 60%, 70% of copper, 70%, 75% of zinc. This is basically based on historic reporting and also in our own guess work. By applying E-LIX, the combination of flotation in E-LIX itself goes up to 80% or 85% in copper zinc. This is a huge difference. And we are seeing -- that's why we are so keen in getting this up and running. And to prove the concept in order to apply it for -- in the longer term. It's going well. We started the year at the plant, as you can see on the right side, it's not a small plant. It's a complex plan with lots of pipes, lots of tanks. Electrolytic cells and leaching system. It's a quite novel system, which I cannot give too much details. And in January '24, when they were leaching some copper concentrates, they got very clean solution enough to produce very clean copper cathodes, totally commercial, grade A, 99.95% copper content without use of SX which is incredible and intriguing. Right now, they are working with other -- with conditions to remove zinc and I can report verbally that the results are coming very well. But of course, there's any start-up and especially when it's a start-up of something that's totally new, needs time and they still need some time to finalize this, and I don't expect this to start running smoothly until midyear because it's logical, they need -- it works when it works, but that suddenly valves, brakes or a pipe is leaking and they have to repair it and things go smoothly. In addition to that, they started with a small team, but right now, they are engaging people and they are training people locally normally. And they will be continuing to recruit people during this next few months. The solar plant is -- has some delays in this picture in February, now is much more advanced a few days ago. You can see some small holes in the middle. There were some delays when including the support because of projects in the pulling tests. And -- but the plant is very advanced and the main connection to the electric line to the high voltage line has already been completed. We had to stop a few days in this quarter. And the substation is in the far end, so we will not need to stop to make the connection to the solar plant. A little bit of delay in this plant, which is disappointing. But on the other hand, as I said before, we had very low electricity prices during the first quarter and it's going to be also low in the second quarter. So we took advantage of this good prices and have a lot in prices for basically most of the second quarter. So any delay on the startup of this plant will not affect our costs -- to the contrary would be very similar or lower than previous years, but we hope to get this thing going in the -- during the second quarter. And Touro is not much to say. It's not much to say, but there is important thing to say. Is that we had elections. There were elections in February in the regional elections, and we don't mention too much, obviously, in the press release because this is something that in theory does not affect us. But what I mean in theory, the reality is that, obviously, there was a certain uncertainty of the results of the elections, which were won by the conservative party with full majority, not because any specific party has more or less support simply because, obviously, this continuity is very good to be able to process our papers. We have applied to -- we have applied for our project to be included in the strategic project, a strategic interest -- project of strategic interest, which is a new law that came into stream in the first of January. And we believe this is going to be included and approved and the -- and as soon as the new government is in place, which is expected to happen sometime late March or early April, we believe that our request will be accepted. This means that the permitting lines are, speed are shorter and there's a much higher confidence that this thing will be -- we'll see the light sometime later this year. An important point is, as I said before, is that we -- will we start them to be trading in the main market sometime in April and later, we will also be -- we're trying to get into the indexes a little bit later. So overall, an exciting '24 where we have lots of targets. E-LIX to confirm that, the solar plant will reduce our costs initial as soon as we get -- try to get to the high rates as soon as possible. The permitting process, hopefully, we get this as a strategic nomination, which means it will be a further improvement. Right now, the situation with the stakeholders is excellent with a very good relationship with everybody. And we will continue exploring and of course, pass into the main market, as I also said before. So our future is very clear. We have said we don't want to be a single asset, so we want to have Touro as soon as possible. We continue to look at all things and I think that in less than 3 years, I see our company getting to the 120,000 tonnes of copper equivalent level, which means copper and zinc coming from the other areas of polymetallic, which is basically doubling our copper production, the same thing that we did, that we doubled in the first years of this company. So exciting future and since we are one of the few pure copper players in the copper market, I think there will be a strong interest in these years that we are seeing an important change in the -- excuse me, in the copper market perception. As you probably all know, this, we have being going back to the $4 per pound levels with the difficulties in production from mines with the waking up after the Lunar period, the new year period in China. The supply side is a little bit stressed, let's say, with availability facing problems with Cobre Panama shut down with Anglo-American and [indiscernible]. So I think the time from the supply side is bright. From the demand, continue -- we continue to see steady demand, especially from renewals and new energy transition is going all over the world. In India, we're picking up. So there's lots of good news expecting to come from the copper price, we expect. And I would say that this is -- this concludes my presentation, probably longer than expected, but fine.

[Operator Instructions] I would like to remind you that recording of this presentation along with the copy of the slides and published Q&A can be accessed via investor dashboard. Alberto, Cesar, as you can see, we have received a number of questions for today's presentation. And Alberto, if I may just hand back to you and kindly ask you to read out the questions, give responses where appropriate to do so, and I'll pick up from at the end.

Okay. Thank you very much. I'm going to be reading the lots of presentation or questions here. I know that '23 PA of Rio Tinto include mining ore from San Dionisio in '24, where you are currently with stripping. So does the current '24 guidance, 51, 53 include ore processed from San Dionisio and if so, how much. In other words, is final permit of San Dionisio with its high rate of risk of potential upside for 2024 guidance? Well, there is mostly -- most of the excavation is going to be waste. But yes, we will be mining through some areas of better grades, which will be processed. So there is a small amount, not much. I would say roughly, I don't have the numbers in my hand. I would say that from the 15 million tonnes processed, I would say, around 10% will be coming from San Dionisio at higher grade. And the permitting in theory should not affect us because we have a permit to make this first interim pushback. I mean, only if the final permitting of the full perimeter of the San Dionisio was delayed beyond, I would say, first, second quarter of next year will probably start impacting the access to this rate. Does it mean it will impact the production because we will be mining from Cerro Colorado, but obviously, the delay will mean the delay of better grades and improvement in copper production. Could you provide an update on commissioning ramp-up at E-LIX added this half. In terms of economics from what you are currently seeing, does production of zinc makes sense at current spot prices or you would prefer to look at producing copper? It's a very good question actually, this last part because we could produce copper and we're producing. But right now, our plans and very likely, this is the way we will start. And as we will be taking away the zinc from the copper concentrates, by removing the zinc but keeping the copper. So we will stay producing copper normally, but we will remove the zinc as contained in this copper concentrates. We have some areas that are available to be mined almost immediately that have higher zinc, which are not in our reserves but also contain higher copper within the Cerro Colorado pit, and that's where we will start. In the term of economics, it will not make a huge difference because this year is a year of ramp-up, and we are only looking at the planned capacity of 10,000 to 50,000 tonnes of zinc. So -- and this is starting in June, ramping up slowly. So I don't think economic will make sense. I think we'll make -- I mean, make a huge difference. I think the upside will come from the application in other parts of the belt and application of specifically in the lower parts of San Dionisio. How is it going to start? Well, right now, as I said before, they are already contracting some people -- they already have one full shift working -- not three shift working from Monday to Friday, but they stop during the weekend. The idea is to train all those people until during the next couple of months. This is not a new technology, absolutely new. And of course, I expect things to happen. So issues to happen, but -- the idea is to start ramping up until the -- during the second quarter and then starts slowly going up, bringing more capacity. More capacity will come from better availability and stopping the small hiccups that they have with filters and pipes, things that are not related to the leaching itself. The next question is share buyback. Are we any closer to this being started? No, we have not decided to do anything with this. I mean there are some question marks a lot, we will reduce the liquidity. I think we'll wait and see what happens with the liquidity once we get into the index. Once we get into the index and once we get into the main list. I think this will probably change the liquidity and then maybe it would be -- this will be possible. Atalaya does not seem to be included in any rankings for the mining sector. What has been done to improve this visibility? Well, we are providing now with all the data to send them to the providers of these rankings. So hopefully, this will come into place this year. Also, we are publishing the '23 report. And I think we will be ranking very well because actually, we are doing things, I would say, much higher level than others.

CEO Alberto, If I may ask, but just to be a little more specific. So we have engaged with the major sustainability rating companies such as Sustainalytics, MSCI and ISS, and we have done a lot of initiatives, and they are all aware about the initiatives that we are taking which is very broad things that we have done since going through the implementation of CBDs reporting or reporting the climate change getting to some target in the medium term. And all this is being considered. So I'm expecting that this sustainability rating agency to start considering this very soon.

Thank you, Cesar. Another question in this line is what are the green measures, not including energy generation that are implemented or has implemented, for example, electric furnaces, Biodiesel, hydrogen? Well, look, so far, hydrogen is not yet economic or even feasible for trucks. This still could be used, but there's no availability in the area where we are. Electric furnaces, they are not applicable. But there are several things that we are doing. One is a much reduced level of water, which are not specific to energy, but they also account for ESG. We are recycling 85% of the water. We only get water from new areas, from dams specifically to avoid what we lose from our operation. We use absolutely all the water of the rains on top of the pit after a period. But the main big change will come with the success in application of E-LIX. E-LIX is a leaching system that basically treats the copper concentrates with electricity, electricity that can be solar, can be wind. Spain has a huge generation of wind and solar. And this we will avoid. First of all, the transport of concentrates. And second, use cathodes directly instead of burning them in furnaces. So this is a huge change. And I think it can probably change the way things are done in some areas. We'll never compete with a smelter because smelter, besides being ESG-friendly or not, they're very, very efficient because they sell the sulfuric acid, which is needed by the way, for agriculture, for fertilizers. So they [ sell this lime ], they are very efficient but I think E-LIX is one of the big contributions as well as water control. Can the dividend just indicated be paid as an interim dividend before the AGM and re-domiciliation to avoid withholding issues? Cesar, can you respond to the -- there are some issues with this?

Yes. I think it might be a little bit difficult as the year is now completed and behind us. I mean, the Board of Directors proposed to pay a final dividend for the year and there might be some legal issues around paying an interim dividend on a year that is completed. I think the process is -- continues to be that the final dividend must be approved by the shareholders. And we're expecting that will happen once the company is already playing. So I'm happy to have a look at this, but I think we will have limited options here.

Start-up of solar -- next question is startup of solar plant is delayed to Q2. As it is near term, can you be more precise, please? I think May is where we expect to have the connection of the grid of most of the plant, which is a good timing also for solar plant. I mean that's the latest estimate. So the delays were coming from some supply issues, delays with the provider of some materials for the service station of Endesa, of the main company, not ours. And also, as I said before, with the support of the panels that in some places, they did not pass the quality test of what they call the pull test basically is a way to check that the panels are not going to be flied out if there's a huge wind coming. And this is -- it means that you have to reinforce them by putting some cement and so on, so this took time, but it's already finished. So our latest estimate is they should be up and running. Another one is, is Atalaya member of International Copper Association? No, we are not. They produce a comprehensive report in '23 called the pathway to net zero. There seems to be no mention of Atalaya has report. Don't you think the ESG profile will be higher considering what you have implemented so far? The first question, yes, we will see -- we'll see how we can become a member. Really, we have not thought on that. And the second thing, I think the profile is going to be increased as such when they receive it, what we have already been engaging with these rating agencies because the way we are doing things, I think it should be much higher. Next question is, will you provide color on the project statistics, project CapEx. There are still no details on the sustaining CapEx. Will you provide more detail on the sustaining CapEx for '24? How much stripping are you planning to capitalize into [indiscernible] San Dionisio and Cerro Colorado? Well, I think, yes, I think we have provided the guidance. I think the typical way of how to capitalize this is basically the excess of stripping that you do in a year on over and on top of the -- over on top of what's the average of reserves is when you capitalize simply for accounting rules. It does not affect the overall all-in sustaining costs, and we always report. In the -- during '24, as I said before, most of the works in San Dionisio is capitalized, I would say, all, because basically, it's removing, stripping excess over the [ roll moving to electric lines ]. And strategic projects, we have yet said what we have is basically San Dionisio preparation and finalize what has been going during this year.

I will beg if I will be a little bit more specific on the sustaining CapEx for 2024. So we historically we've been spending around EUR 8 million, EUR 6 million to EUR 8 million, closer to EUR 8 million. This year as we are investing on the pre-striping of San Dionisio, the plan is to spend around EUR 6 million on sustaining CapEx.

Next question is [indiscernible] It seems that E-LIX is showing promising results. When does the Atalaya expect to provide more details on E-LIX performance forecast? I would say, as soon as we have them, midyear, I think we will probably announce the production of zinc material as soon as they start commissioning and I would say, midyear, when we see that the things can go more or less steady, I think we will give some guidance of what the -- and so far, the results from the recovery point of view, which is a difficult part [indiscernible] What shows some -- looking to show some hiccups is in basically typical things of commissioning like water valves, filters, clogging until they find tubes, which is quite normal with commissioning of plants. The next question is at ISM regeneration, can you give more details of any plans, if any, to expand this energy production? Well, we had a study and we had a measuring tower to produce wind 18 megawatts, but we had -- we received the results, and it was barely economic for self-generation. So when you see that there's a huge wind generation happening in Spain and solar with the future prices being around EUR 40 per megawatt hour, it is very difficult to be competing with this, although the energy generation will not be ours, but it will be generated by wind and solar because Spain is growing big time. And the next question actually mixed with this is, going forward, what will be the mix with wind and solar in 5, 10 years? Look, then with Spain -- I mean, we get -- besides the 22% we will get from our solar, that's ours. The rest of, let's say, 80% to simplify, the rest will come from the grid. The Spanish grid normally around 80% to 85% is known related to CO2. Around 20% is nuclear and the rest is hydraulic, wind and solar with a wind growing big time and solar also. But solar, as you know, is intermittent. So I think that will be the profile in the future will be probably growing to 90% in general. There will be wind and solar in hydrolic and that's 90% of the 80% that we don't consume. So I would say probably our copper and our production will be one of the better from this CO2 point of view because it will be basically 90% of the 80% plus sort of over 95% or 92% related to wind, solar and hydro. Continuing with energy generation. Will these assets be incorporated into separate company owned by Atalaya, advantages of raising debt from the separate unit. It reaches a critical -- if it reaches a critical side, could it be IPO-ed, would be considered? I think our size is very small, and I don't think that would be -- I would think -- we may think in disposing off this -- our solar plant into an electric company to strengthen the balance sheet and take it away. It's something that we can do, sign up a long-term PPA with the supplier and something we will investigate. But IPO-ing, is a very small amount. It's not worth that. Another question is how are the evolving rates in Cerro Colorado, any reason to worry? When you should expect to reach 60,000 tonnes, thanks to San Dionisio. I think starting with the last one, 60,000 tonnes we'll reach in '25. And reason to worry, well, we have had a couple of quarters with low-ish grades, lower than normal. Similar to the migrates. But if you look at the PA that was prepared in '21, those numbers of lower copper grades were predicted. So they were expected to happen in '24, simply because the best rates of the Cerro Colorado are in the East and Far East and in the West, basically under the road, and there are slated to be in production in the last 5 years of the life of Cerro Colorado, which means we are going through lower rates. But this is planned. I mean this nothing that is -- it's in the PA that's published in our web page. In [ relation ] somebody asks me about artificial intelligence, if we have considered practical application of this new technology for Atalaya? Not as such, but we have lots of things that are doing this in a practical way like optimizing the consumption of the mills. Small things that have been -- we're in the leading part of that, but not AI itself. I think this is something that has been done for a few years already. If an acquisition is made abroad in a more geographically challenging environment, automation and running the mining on site maybe a strategy. This is something that Atalaya has looked into? Have you looked at into truck optimization, including in Spain? Yes, we have looked at truck optimization? It's not so economic in Spain due to the low wages. I mean our drivers are probably cost around 5 to 7x less than in Australia. So the advantage of that is not that clear. Running from the distance, well actually can be done because it is not a problem at all. Right now, I or anyone could look in their telephone or computer, how the plant is going. We can just start it, we can stop it, we can do everything. Everything is done automatically from the control room, but with access to any of the computers that are authorized. So this, of course, could be done. If you had to go in a challenging environment, the main question here is always maintenance, maintenance and getting good people is the difficult part. Anything you have told that you can say in respect of time lines for permitting? Well, we expect to receive the approval of the project being considered strategic -- of strategic interest, some timing in, I would say, April, maximum May, that speeds up the permitting and almost is an endorsement of the government -- of the regional government. Why is that? It's because before declaring it as strategic, they have to go through a whole evaluation of the project from the environmental point of view, economical point of view, social, which means it's very unlikely that the departments of the government, regional government, that are reporting and making the reports for the President and the Council saying that this is strategic, will change their views just two months later. So I think that will be a huge endorsement and we expect to see this change in, I would say, April, maybe May -- you never know because there's no time line, but we believe it's going to be soon, sooner rather than later. Considering that E-LIX has theoretically -- was theoretically until Atalaya built the testing -- was theoretical until Atalaya build the testing plant and then move into production. How do you intend to protect your IP? Is there a way to build a JV company with E-LIX to monetize the technology further? Well, the IP is -- we have the exclusivity in the Pyrite belt, and we have the rights of refusal if the technology is sold somewhere else. But the technology is not ours. We are financing a line technology that has it, it is a single person company which we are financing mostly with loans convertible into equity in this company. So we have a participation in the moment if this technology is monetized. But unfortunately, it's not ours, although we have lots of rights attached to the success of this. Since we are no longer incorporated into Cyprus, and we have no takeover protection built in the articles, what is a fair takeover value? How would you hope to protect against a hostile takeover? Well, fair takeover value, it depends on what the shareholders decided to approve. I think everybody understands that we are quite far from our fair takeover value. And the best way to be protected is to have strong shareholders, and we have Trafigura, we have Cobas, we have MATSA, we have [indiscernible] you will get over 50%. So it would have to be something that at least these five entities will consider positive. So it's a hostile takeover will be very difficult to happen into our company. And if it happens, of course, we have a defensive strategy, and we have some banks already in place for this, for our defense. What is our current relationship with Sandfire and MATSA, is there a dialogue? Well, we have a dialogue from the technical point of view and always try to see if we can optimize things, but nothing else that I may think. Eventually, I think we'll have to agree in areas that are common, where we have tailings, where there are deposits that are very close to each other, where maybe we can optimize. Our debt is very low, which makes us more attractive for any potential bidder. Do you plan to address this position? Well, we are looking at things as usual. But it's better to have a very low debt or very strength, a good balance sheet because we -- it can give us more protection if there is any difficult times. Another question is, it was mentioned that total permitting was progressing swiftly. What's the next milestone of our Touro? When do you expect to have an outcome on the permitting process? Well. As I said before, the next milestone is consideration of the project to be a strategic project. And later, during the next -- the permitting will probably be the last part of the year when they have gone through all the environmental evaluations. On CapEx, you have guided '24, but you could possibly provide a bit more color for '25? As a reference, consensus is EUR 135 million. How do you feel about this number? And would you please talk what your expectations are? I think we will -- I think the reason why is EUR 135 million is everybody expecting Touro, I think is reasonable. I think Touro will be around EUR 250 million, so higher than before. And I think the expectation as consensus approved, we will have about half of that CapEx to be incurred in '25 because it's when we expect to start pursuing Touro. Touro very likely if we get the permits at the end of the year, in the last quarter, we will be constructing it in 1 year and 3 months. We have everything ready to move very fast. So most of the expenditure will happen in '25. Shareholder [indiscernible] giving Trafigura an exit from MATSA. Do you have any view on their long-term position with Atalaya. Is there any dialogue with Trafigura? Well, Trafigura, we don't have any dialogues especially. We have one person of Trafigura on the Board, but we don't have anything special. We know -- well, we know, no, we never know, but we suspect looking at the history, that obviously, there will be an exit at a certain time to monetize their investment. They have been here already, I would say, 7 years or 8 years or 9 years. So if you look at what happened in other cases, they have exited. But when they will do it, well, I'm sure they will do it in the time where we believe they have a good return. But then we don't have any special dialogue with them about this. The next question is solar plant. Could you remind us, what the difference it makes in terms of cash cost per pound. Look, it's around 22% of the electricity that will become, let's call it for free. It will be in our balance sheet. So 22% of electricity, if the total cost was around, let's say, GBP 30 million, GBP 22 million will be GBP 6 million saving, GBP 6 million is around GBP 0.05, GBP 0.06 cents per pound. You consider rough numbers it will give you buyback GBP 100 million payable. And next, can you remind us the commissioning time lines, when might you consider permitting more capital to this project? Well, I have mentioned, I mean, commissioning in this next quarter and then more capital to this project probably at the end of the year or next year, if we consider then it can be applied for as a benefit from other areas. We always use our contractor for mining. Why is everything outsourcing? Any plan to bring back in-house? It's possible to bring it back in-house, but we have made all kinds of numbers. And a contractor has a very low margin and has something that we don't have, which is access to sell the machines later at a very good price. And that's the reason why in Spain, most of it is outsourced. Simply, they are more economic than anything else. Treatment, refining charges, [indiscernible] have fallen dramatically year-on-year. Are you able to quantify the tailwind [ generation ] at Atalaya, that we should expect to trade '24? Well, normally, we are through benchmark. So the benchmark of this first part is already matched and is going down, of course. But they are in the future, it can be very interesting. Normally, if you see [indiscernible] I would say, represent around GBP 0.20 per pound in '24. So if this remains, let's say, in half, you can consider it would be GBP 0.10 per pound if it continues to be like that. I don't think it will continue so much, to be honest, simply because I suppose there must be some discipline in stopping some smelters. Otherwise, everybody will lose money because this is spot prices [ that if ] smelter do not make any money and they better stop. Does a '25 -- another questions, wastage -- million tonnes wastage shipping guidance for '24 into San Dionisio? No, that's the waste on Cerro Colorado, which is roughly slightly less than 2:1 cost per tonne. How should we be thinking about margin uplift given E-LIX from '25 outwards? Very early to say. I cannot say how, it's margin going to improve. I think the main key point of E-LIX is to use it on polymetallic, which will increase recoveries and of course, by increasing the recovery you lower your costs and get more tonnes. Could the forthcoming announcement dividend be paid before the re-domiciliation. I think this has been answered because it's a bit complicated. The volume at E-LIX on horse ride -- is a one horse ride, is there an opportunity to span into other copper countries like Spain, for example, Congo or another country? Well, we are looking at all the places, certainly not Congo, but yes, we are looking at all things. Congo, it's 7 years' experience in Congo. It's not an easy place for foreign companies, and that's why you only see there Glencore and Chinese companies with some Indian small companies. There's a reason for that. What could be expected only cost when the company gets to those 120,000 tonnes in 3, 4 years, close to 250,000 tonnes, and what are the key movers of it now? Well, yes, absolutely. The drivers will be around closer to 250,000 tonnes. But volume-wise, I mean, this is a set of different operations, group of different operations, not a single operation of 220,000 tonnes. So the effect in all-in cost is not as high. It's adding several companies, not a larger operating company. So the only thing that goes down is the G&As, which are divided down and also the fact that the costs in total are going to be lower and the costs at an initial with the higher rates are going to be, if I remember well, our average of around $2 per pound, so substantially lower than now. Another question is, could you consider alternative business in noncorporate to take advantage of [ current assets ], clean energy, building, warehouse structure [ for our operational ] data centers? Well not at this stage because you need people, you need the experience. And I think we have enough troubles with -- in our hands, and we have lots of projects going on that we don't even report until they are already materialized. So we'll concentrate on what we know best. Well, we have gone through 1 hour. There's no more questions and being lots of questions, and we will try to run as much as possible. I only want to -- we are out of time. I want to thank you for attending and being so active as usual. And if you have any questions, please let us know with our page or any of our executives. Thank you very much.

That's great. Alberto, Cesar, thank you very much indeed for updating investors today. Could I please ask investors not to close this session as you will now be automatically redirected to provide your feedback in order that the Board can better understand your views and expectations. This will only take a few moments to complete and I'm sure will be greatly valued by the company. On behalf of the management team of Atalaya Mining Plc, we would like to thank you for attending today's presentation, and good afternoon to you all.

Thank you.

Thank you.