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

Good morning, ladies and gentlemen, and welcome to the Atalaya Mining Plc 2024 Annual General Meeting. [Operator Instructions] I'd now like to hand over to the Board from Atalaya Mining. Good morning.

Thank you. Good morning. My -- I apologize straightaway. I'm afraid I'm either going to be very rude to the people at that end of the table or very rude to the camera so that with this setup it's a little bit difficult. So I'll probably be rude to you get down that end. Before we start, can I just set out the form of the meeting? I've been asked to read out the Chairman's statement, which, of course, is in the 2023 Annual Report and then with a very minor modifications also in the RNS of this morning. But I've been asked to read out the whole script of that, which I will do. We will then move on to the formal part of the meeting. And can I please ask that any questions on the formal -- we restrict any questions to the formal part of the meeting initially, which will be -- we can take before the resolutions. After the formal part of the meeting, we will have a presentation by Alberto Lavandeira, the CEO. And can I please ask you to hold any questions concerning the performance or strategy or the future of company or past of the company from anything until then because the presentation may very well answer some of your questions or most of your questions. So that's the format of the meeting. And with your permission then I'll start the actual meeting, which is, ladies and gentlemen, welcome to the Annual General Meeting of Atalaya Mining Plc. My name is Roger Davey. I'm Chairman of the company. And with the consent of the meeting, I will act as Chairman of the meeting. Not hearing any [indiscernible], I'll start. Please let me introduce first of all my fellow directors. Alberto Lavandeira, over here; Neil Gregson, who, as we know, will be taking over as Chairman in 3 days' time; Dr. Hussein Barma, who is further down the room; Kate Harcourt; Stephen Scott, next to Kate; and warm welcome to our latest Director Carole Whittall, right here; and of course, to Cesar Sanchez, our CFO. We have an apology I'm afraid, Jesus Fernandez could not -- was not able to be in London today. So he sends his apologies to the meeting. The meeting will now come to order. And with your consent, I shall ask George Hadjineophytou, he is in the middle, over there, to act as secretary and scrutineer of the meeting. The following documents have been tabled: Circular containing the notice of meeting, all in proxy; the annual report containing the audited consolidated financial statements for the year ended 31st December 2023; the new articles; the draft terms of the cross-border conversion; the expert opinion with regard to the draft terms of cross-border conversion; the announcement informing shareholders, creditors, employees of the company of their right to submit comments regarding the draft terms of the cross-border conversion; and the solvency declaration on the current financial status of the company as of 30th of April 2024 and approved on the 24th of May 2024. These documents are, of course, available for any shareholder to examine as they wish. The Annual General Meeting of the company was convened by the notice of shareholders dated the 31st of May 2024. May I take the notice is read? Thank you. I advise that there is a quorum present, and that notice calling this meeting has been given in accordance with the company's Articles of Association. I now declare that the meeting that is properly called and constituted for the transaction of business and turn to resolutions before the meeting and propose each resolution in turn. Okay. Another apology, I'm afraid this meeting is a little longer than normal because of the read ons and the work we've done. Resolution #1. Provides for the receipt and consideration of the audited consolidated financial statements of the company for the year ended 31st of December 2023 and the reports of the directors and auditors thereon. Now full details of the proxy votes will be in the announcement later. And so I'm generously being permitted to round off the numbers during this meeting. So the votes for in resolution 1, the proxy votes have been cast as follows: the votes for, 94.6 million; against, 71,000; and withheld [ 1,700 ], which is a vote for of 99.9%. I now propose resolution #1 as an ordinary resolution. Those in favor, please? [Voting]

Thank you. Those against? [Voting]

No hands. Thank you very much. I declare the resolution carried. Reelection of Roger Davey. Then resolution #2 provides the resolution -- reelection, sorry, of Mr. Roger Davey as Director of the company. In respect of resolution 2, the proxy votes have been cast as follows: for, 94 million; against, 627,000; and withheld 1,700, which is a vote for of 99.3%. Can I ask shareholders please to propose the resolution #2 as an ordinary resolution. Shareholder -- sorry, I propose the resolution. Thank you. Those in favor? [Voting]

Thank you. Those against? [Voting]

Not seeing any. I declare the resolution 2 carried. Reelection of Mr. Alberto Lavandeira. The resolution # 3, votes for the reelection of Mr. Alberto Lavandeira as a Director of the company. In respect to the resolution 3, the proxy votes have been cast as follows: 94.4 million for; against is 263,000; and withheld 1,713, which is a vote for of 99.7%. I now propose resolution #3 as an ordinary resolution. Those in favor, please? [Voting]

Thanks. Those against? [Voting]

Not seeing any. I declare the resolution carried. Resolution #4 provides the reelection of Mr. Jesus Fernandez as Director of the company. In respect to resolution 4, the proxy votes have been cast as follows: for, 83.6 million; against, 10.4 million; withheld, 552,000. That's a vote for of 88.9% of the proxies. And I now propose resolution #4 as an ordinary resolution. Those in favor? [Voting]

Thank you. Those against? [Voting]

Not seeing any. I declare the resolution carried. Resolution #5 provides for the reelection of Dr. Hussein Barma as the Director of the company. In respect to resolution 5, the proxy votes have been cast as follows: for, 89.4 million; against, 5.2 million; withheld 1,713, which is a 94.5% vote for. I now propose resolution #5 as an ordinary resolution. Those in flavor. [Voting]

Thank you. Any of those against? [Voting]

Not seeing any. I declare the resolution duly carried. Resolution #6 provides for the reelection of Mr. Neil Gregson as Director of the company. In respect to resolution 6, the proxy votes have been cast as follows: for, 86.1 million; against, 8.5 million; and withheld, 1,713, which is vote for of 91%. I now propose the resolution #6 as an ordinary resolution. Those in favor? [Voting]

Thank you. Those against? [Voting]

Not seeing any. I declare the resolution carried. Resolution #7 provides for the reelection of Mr. Stephen Victor Scott as Director of the company. In respect to resolution 7, the proxy votes have been cast as follows: for, 89.1 million; against, 5.5 million; and withheld, 1,713, which is vote for of 94.1%. I now propose resolution #7 as an ordinary resolution. Those in favor? [Voting]

Thank you. Those against? [Voting]

Not seeing any. I declare the resolution carried. I apologize. It's a little bit dry and have to keep going. Resolution #8 provides for the reelection of -- not because of you -- reelection of Mrs. Kate Jane Richards as a Director of the company. With respect to resolution 8, the proxy votes been cast as follows: for, 89.1 million; against, 5.5 million; and withheld, 1,713, which is a vote for of 94.3%. I now propose that resolution #8 as an ordinary resolution. Those in favor? [Voting]

Thank you. Those against? [Voting]

Not seeing any. I declare the resolution carried. Resolution #9 provides the reelection of Mrs. Carole Whittall as the Director of the company. In respect to resolution 9, the proxy votes have been cast as follows: for is 94.6 million; against, 62,000; and withheld, 1,713, which is a vote for of 99.9%. I now propose resolution #9 as an ordinary resolution. Those in favor? [Voting]

Thank you. Those against? [Voting]

Not seeing any. I declare the resolution carried. Resolution #10 provides for the appointment of PricewaterhouseCoopers Limited as the auditors of the company and to authorize the directors to fix their remuneration. In respect of risks -- sorry, was that resolution 10? Sorry, I did say that. In resolution #10, the proxy votes have been cast as follows: for is 94.6 million; against, 64,000; and withheld, 47, which is a full vote for of 99.9%. I now propose resolution #10 as an ordinary resolution. Those in favor? [Voting]

Thank you. Those against? [Voting]

Not seeing any. I declare resolution carried. Resolution #11 provides for the declaration of the final dividend for the financial year ended 31st of December 2023 of $0.04 per ordinary share of the company. In respect to resolution 11, the proxy votes have been cast as follows: for, 94.6 million; against, 17,000; and withheld, 1,713, which is a proxy vote for of 100%. I now propose resolution #11 as an ordinary resolution. Those in favor? [Voting]

Thank you. Those against? [Voting]

That wasn't a hand. Those against, not seeing any. I declare the resolution carried. This is like an auction, you can buy things if you raise your hand. Resolution #12 provides for the approval of the Directors' remuneration report as set out in the company's audited consolidated financial statements for the year ended 31st of December 2023. In respect to resolution 12, the proxy votes have been as follows: for, 68 million; against, 26 million; and withheld, 1,185, which is a vote for of 71.9%. And I propose resolution 12 as an ordinary resolution. Those in favor? [Voting]

Thank you. Those against? [Voting]

Thank you. Not seeing any. I declare the resolution carried. Resolution #13 provides the approval of the Directors' remuneration policy. In respect to resolution 13, the proxy votes have been cast as follows: for, 63.4 million; against, 31.2 million; and withheld 1,185, which is vote in favor of 67.1%. I now propose resolution #13 as an ordinary resolution. Those in favor? [Voting]

Thank you. Those against? [Voting]

Not seeing any. I declare the resolution carried. Resolution #14 authorizes -- sorry. Resolution #14 authorizes the Directors to grant pursuant to the Atalaya Mining Plc long-term incentive plan options to subscribe for up to 7,028,285 ordinary shares in the capital of the company, which represents approximately 5% of the company's issued share capital at an exercised price in accordance with the terms of the long-term incentive plan. In respect of resolution 14, the proxy votes have been cast as follows: for, 68.8 million; against, 21.5 million; withheld, 4.3 million, which is vote for of 76.2%. I now propose to the meeting resolution #14 set out in the notice convening the Annual General Meeting, as at least 50% of the company's issued share capital is represented at the meeting. In order for the resolution to be affected, it must be passed by a simple majority of the votes cast on the resolution. So I'll ask those in favor, please? [Voting]

Thank you. And those against? [Voting]

Not seeing any. I declare resolution 14 carried. Resolution #15 authorizes the Directors to issue or grant rights to subscribe for up to an aggregate of 14,056,571 ordinary shares, representing approximately 10% of the current issued share capital of the company, as if the rights of pre-exemption in Section 60B of the Cyprus Companies Act -- Law -- Cyprus Law did not apply. Such ordinary shares issued or rights to subscribe to ordinary shares granted pursuant to this authority will be at a price of not less than 20% discount to the market price of an ordinary share on the main market for the 10 trading days immediately preceding such issue of grant. In respect to resolution 15, the proxy votes have been cast as follows: for, 94.6 million; against, 62,000; and withheld, 1,715, which is a vote for of 99.9%. I now propose resolution 15 set out in the notice convening Annual General Meeting as at least 50% of the company's issued share capital is represented at the meeting. In order for the resolution to be effective, it must be passed by a simple majority of the votes cast on the resolution. Those in favor then, please? [Voting]

Thank you. And those against? [Voting]

Not seeing any. I declare resolution 14 (sic) [ 15 ] carried. Resolution 16 provides for an amendment to the company's Articles of Association by the deletion of Regulation 161 and substituting this as a new Regulation 164 as follows: 161, the company may, in accordance with the Cyprus company's law, continue to exist as a legal person under the legal regime or jurisdiction of a country other than the Republic of Cyprus. In respect to this resolution #16, the proxy votes have been cast as follows: for, 94.6 million; against, 62,000; and withheld, 1,715, which is a vote for of 99.9%. I now propose resolution #16 as a special resolution. To be effective, it must be approved by at least 75% of the votes cast at this meeting. So those in favor, please? [Voting]

Thank you. Those against? [Voting]

Not seeing any. I declare the resolution carried. Resolution #17 provides for the approval of the cross-border conversion of the company pursuant to the draft terms of the cross-border conversion by the Board of Directors on the 24th of May 2024 in accordance with Regulation 161 of the company's existing Articles of Association. As a result of such cross-border conversion, the company shall longer to be governed by the laws of the Republic of Cyprus, which are continuing to exist as a legal entity, which shall be governed by Spanish law. In respect to resolution 17, the proxy votes have been cast as follows: for, 94.6 million; against, 19,000; and withheld, 47, which is a vote for of 100%, effectively. I now propose the resolution #17 as a special resolution to be affected. It must be approved by at least 75% of the votes cast in this meeting. Those in favor, please? [Voting]

Thank you. Those against? [Voting]

Not seeing any. I declare the resolution carried. Resolution #18 provides for the submission of an application to the Nicosia District Court for the purposes of obtaining the pre-conversion certificate attesting to compliance with all relevant conditions and to the proper completion of all procedures and formalities in Cyprus with respect to the cross-border conversion. In respect to resolution 18, the proxy votes have been cast as follows: for, 94.6 million; against, 18,000; and withheld, 47, which is effectively 100% vote for. I propose resolution #18 as a special resolution. To be effective, it must be approved by at least 75% of the votes cast at the meeting. Those in favor? [Voting]

Thank you. Those against? [Voting]

Not seeing any. I declare the resolution carried. Resolution 19 provides for the company -- sorry, resolution 19 provides that the company shall take all such steps to make all necessary tax returns with the tax authorities in Cyprus and obtain tax clearance certificates. In respect to resolution 19, the proxy votes have been cast as follows: for, 94.6 million; against, 18,000; and withheld, 47, which is effectively 100% vote for. I now propose resolution #19 as a special resolution. To be effective, it must be approved by at least 75% of the votes cast at this meeting. Those in favor? [Voting]

Thank you. And those against? [Voting]

Not seeing any, I declare the resolution carried. And finally, notarization of resolutions and declarations, applications and statements in connection with the cross-border conversion. The resolution #20 authorizes each of the company's directors and Mr. Cesar Sanchez Fernández as company CFO as well as the company's legal counsel in Cyprus 2. One, have these resolutions notarized before a notary public in Spain as well as to take all actions and execute all public and private documents as are necessary or desirable for registration of these resolutions at the Spanish company's registry and for the removal from the registry at the [ CPIA ] company registry of entries relating to the company. And two, this is a wonderful legal document. It's over 100 words in one sentence. Make all declarations, applications and statements and to all acts on things as may be necessary in connection with the cross-border conversion and to the all related and ancillary acts and sign and register any documents in connection with the registration of the company in Spain and generally, to do all such things being in the interest of the company for it to cease to be registered in the Republic of Cyprus and make all necessary notifications, applications to court, any applications to inform the Cypriot and Spanish tax authorities all the cross-border conversion and take any other necessary actions in this respect; and, #2 -- 3, take all actions and complete all processes with private persons or public organizations of any nationality as are necessary or convenient under applicable law to execute, register or disclose these resolutions or their effects. In respect to resolution 20, the proxy votes have been cast as follows: for, 94.6 million; against, 62,000; withheld, 1,713, effectively 99.9% vote for. And I propose resolution #20 as a special resolution. To be effective, it must be approved by at least 75% of the votes cast at the meeting. Those in favor, please? [Voting]

Thank you. Those against?. [Voting]

Not seeing any. I declare resolution carried. Thank you very much. That completes the business part, the formal part of the Annual General Meeting, and I declare the meeting is closed. Thank you all very much for attending. We would like to invite -- no, sorry. Before we do that, we will then -- the meeting is now closed, the formal part. I'll now hand over to the CEO, Alberto Lavandeira to do a presentation on the company.

Thank you very much. I will try to be brief. Thank you, Mr. Chairman. I will try to be brief and leave some time for questions, as always. So we're going to start first with the results -- the review of the results of last year, and I have here also close to -- the results of the previous year. We've produced around the same amount of copper last year, only around 600 tonnes less by possessing more ore in the mill at lower grade. And despite the lower production and the lower grade, we were able to get cash costs of around $2.80 per pound and around $3.1 per pound all-in sustaining costs, which are around $0.20 lower than the previous year. The reason for that is mainly the reduction of operating costs, most of them related to electricity and everything related to the energy prices during last year. So it was a quite successful year because we had a bit of EUR 73 million, which is around EUR 20 million more from previous year and profits of EUR 36 million, which is basically 20% higher than the previous year. Operating cash flow of EUR 65 million was also higher, around EUR 30 million higher than the previous year. And free cash flow went from being negative in -- during the '22 still being positive around EUR 50 million in '23, and this allows us to maintain our net cash position in around EUR 55 million like previous year without debt in spite of being invested in exploration in the development of solar plant and other investments. I would say from the economic point of view, it is a quite -- it was quite a good year. From the corporate point of view, we decided to -- we announced that we will be moving to the main market and we'll talk about a little bit. We also announced that we would be moving out from Cyprus to Spain in order to benefit from all the things that we can discuss. And also, we paid a dividend, and we announced another dividend, which basically is $0.09 per pound -- per share, excuse me, which is also substantially higher the $7.5 million -- $0.75 per pound that we had last year. So again, from this point of view, we delivered on our promises. And from the assets point of view also previous year, we have said we were going to start E-LIX, and I'll report a little bit of that, but we were able to start producing some during test work. In spite of the delays, we're able to produce some copper cathodes and some zinc precipitates produced from the treatment of copper concentrates. But also quite important is that we have already started stripping at San Dionisio for future mining phase. And I should remind that last year, we said that we had just published the 43-101 related to old resources, and we were just going to start a [ permitting ]. And actually, 1 year later, we are already mining the first phase of that pit. We also -- last year, we also announced that we were going to start a solar plant. And this year it is basically finished. And also, we said we were going to continue with the permitting process at Touro, which we did. And also this has resulted in [indiscernible] of strategic interest by the [ Xunta de Galicia ]. We have continued working also with the ESG and health and safety, publishing our second -- third sustainability report and also providing the targets for reduction of emissions, Scope 1 and Scope 2. And we continue with activities of restoration of the rivers, clean waters around Touro and the construction of the solar plant in [ Riotinto ]. Some changes to the Board. Neil Gregson was appointed as Senior Independent Director and also he is from now going to be a Chairman of the company. So all the details are there. Going a little bit in and trying to be very brief. I think an important achievement this year was getting to the main market. The mission in April was the end of a long journey that we had planned a couple of years ago, and it was responding to the desire of lots of investors and wanted the transparency and the benefits of being in the market. What this transition will also mean that we will be able to -- after re-domiciliation in Cyprus to move our headquarters, official headquarters from Cyprus to Spain, which is logic because all our assets are in Spain. And that will mean that we will be able to be subject to inclusion of the index in the LSE, which will provide, again, a new source of liquidity to our shareholders, which is something that we always required and it was planned full time. With this, it also brings some changes in the rules. And I would like to say that the main thing is that our Chairman here, Roger Davey present in the ceremony, has been over 10 years in the company. Due to the rules of the main market, he is not ever -- not longer considered independent, although I have to say in public that I've not seen people as independent as Roger. And I now want to thank you, thank you in public for his contribution during this very long and successful journey, although sometimes it's been very painful. But Roger will remain in the Board and as a Non-Executive Director and will be substituted by Neil Gregson, which as you know has also been with the company for quite a long time and knows very well the company. I'm sure he would be as good as Roger. Also, some changes in the Board. Kate had been Senior Independent Director, and I welcome Carole Whittall to our company. She is known as a [indiscernible] and this company has never unfulfilled the promises. So you will continue having a lot of things to talk about the progress of this company. The main thing to that we will be welcoming this year is the final [indiscernible] awarded strategic status project. Project of strategic interest according to the laws of [indiscernible]. This is the law that was passed at the beginning of this year, which is designed to expedite and streamline the permitting of industrial policy. It is the first time, mining project is included in this type of initiatives. We'll fulfill all the conditions, and we have been working with the authorities and all the stakeholders with more than 300 million having held being held in the community, in the project to listen to the concerns and to give solutions to the concerns that something having a negative impact declaration 4 years ago. We believe that with this declaration, the permitting of the project of Touro is going to be much lower, much shorter. Maximum by law, it is going to be 1 year. We think it's going to be shorter than that, and we look forward to get in this project, which will be part of our future. Last year, we also mentioned that we have filed the technical report for San Dionisio has higher grade, almost double the grade that we are mining in Cerro Colorado, which you can see in the picture. And 1 year later, we are already mining. We still have to receive the full permits for the full open pit as you can see the existing operation is already substantial. And this will allow us to produce higher grade copper in this year '24 and substantially higher production in the years to come. The lower part of the project contains some sulfides of copper mixed with zinc, which will require the addition of flotation, a new flotation installation or the treatment of the polymetallic sulfides. Also last year, we set up as part of our strategy to treat those sulfides, we will be looking at something that we have been providing assistance, financial assistance and technical assistance to system called E-LIX, which has been developed on site. We showed last year's picture, similar to this, where we can see in the center of the picture, the plant of E-LIX. At that timing, it was only a cage, something empty with a few installations. And I believe that the last presentation showed some flotation cells. This system should provide us with better recoveries in the complex metallurgies with around 20 points higher, which although still needs full commissioning, but we believe we can add a lot of value to the company, specifically in the polymetallic sulfides in the pilot plant. So last year, we're only shown cage, and this year, we can show a little bit more than that, although the secrecy that this construction has been taking doesn't allow us to show all the installations. But you can see in the right side picture that installation is something quite complex of pipes, which has allowed us to produce already the first copper cathode during the commissioning in the last days of the previous year, simply when we're testing the production [indiscernible] cells and also all these copper sheets came from the copper concentrates. This system can also extract the zinc from copper concentrates and also the plant right now that's been commissioned has been extracting zinc concentrates, zinc metal precipitates from copper concentrates, shown on the left and on the right, you can see the copper clean concentrate. So in other words, inside the plant, you -- you introduce a mixed blended copper zinc concentrate and you can extract a zinc precipitate that you can leech and use metal directly and you are left with a copper concentrate without zinc and without the penalties, but you can also leech and use metal directly or sell it as it is piece for better cost. I can announce now that although we have had delays and these things always take time because they are quite new, we are in the commissioning phase already in a continuous or semi-continuous operation, and we should see the economic results of this installation during the second part of 2024. For this, the main reagent is electricity. 80% of the cost of this plant is electricity. Last year, as I said, we had higher break of costs, and we're already showing some boxes of cells that had arrived at site and be ready to get assembled and [indiscernible] in production by this year. Unfortunately, we have had some delays with the supplier. But as you can see, the plant is basically finished, and it will be commissioned at the end of the year. Actually, in the view of installation, in this picture, you can see there in the far left, all that old dump covered with panels, which not only restores an old dump, but also gives us future cheap electricity, which will be fundamental not only for the operating cost of the flotation plant, but also for E-LIX. This plant should provide 22% of our electricity needs, with around a little bit more than 35% also being hedged already at a low copper price for a low electricity price, which means we will be able to get cheap electricity for the future in our company. And finally, what are our targets for this year? Well, we have [indiscernible] main market. We have achieved that already. We are progressing to move to Cyprus. The resolution, as we have heard before, of moving up to Cyprus has been approved unanimously. And we believe we will be ready to have this thing approved by fourth quarter of this year. E-LIX will continue to ramp up and commission in the second part. We also expect the start of the solar plant finally. We will continue some initial stripping and providing higher grades. We also finalized the permitting of main pit, which we don't have any doubt of going to be obtained because we have already obtained the most difficult part, which is the tailings expansion and the footprint of the [indiscernible] itself. At Touro, now that we have received the strategic environment -- strategic industrial project status, it means that the project would go into public information in summer, late July, early August, which means it will go through August, maybe September, the paperwork in the [ Xunta ] can be made, the reports in the last part of the year, and we could have the approval of this project because we believe it will [indiscernible] all the conditions at end of this year or by first quarter of '25 and never more than 1 year. Following that, in 15 months to 18 months, we will have that probably up and running, exactly in the point where we believe the copper prices are going to be quite high and higher -- substantially higher than now. This is a very clean concentrate, very straightforward project. I won't say [indiscernible] based on what we have done in Riotinto. But certainly, I used to say that when we built Riotinto, we build it without money, and in this case, we have now a good balance sheet and we have money in the bank, and we have a team with experience, it must be a piece of cake. Having said that, we continue also to focus on finding more things in the district around Riotinto. We have several ways going on. And we also continue to look even abroad in Europe, in South America, [ Iberian ] Peninsula for new discoveries to expand the life of this company. And remember, when we first started exact 10 years ago, the first year of this new area was in 2014. We had ahead of us 12 years of life. We have grown now 10 years and we still have 15 ahead of us, assuming we will find anything. So I think the future of this company is excellent. So this concludes my presentation. I wanted to make it brief, and we have a few questions coming online, which I'm happy to eagerly respond. I don't think people can see them, but I can see them on my screen.

Yes. All right. So the first question comes, what are the key milestones and time lines for Touro project? And what challenges, opportunities do you foresee in the development of this project? Well, I've said about the key milestones. I think we will see they're probably going to public information in the summer. We see responses of [ litigations ] and complaints of those opposing this by the third quarter, and we will be able to have all our equipment work ready by the end of the year. After that is the Xunta de Galicia, which has shown support in this project to reply and give us the status of the final permits, which will include, by the way, the urbanistic permit, the construction permit, the water permits. So all the permits associated will be obtained in one go, which we expect it to be. Challenges, of course, will always be some challenges in the construction, you never know. Opportunities, I think the opportunity there is to make further discoveries to be able to use some byproducts using E-LIX. And I think that project, I'm sure it will -- we will see the same thing that's happened in Riotinto, where we would extend the mine life, and I see that probably for going at least 20 years quite easily with the resources we have in the ground. Second question comes, says cash costs have decreased significantly. Can you elaborate the main factors that contributed to this reductions? And how sustainable [indiscernible] in the long term? Well, I think they are fully sustainable. Actually, the cost today up to June are similar or lower than previous year. The main reduction of these costs are due to the lower electricity costs, and this -- it seemed that's something that's here to stay. Actually, the cost will even be going to be reduced much more when we start inputting higher grades from selling these because, obviously, the costs that we have are mainly per tonne of material introduced to the plant. And we have higher grade, we use more, the cost goes up. The third question comes like following the re-domicilation in Spain, what changes are expected in company operational, regulatory or tax framework? Well, I don't think there will be many changes. The regulation in tax are similar to what we are enjoying right now. We are not having specific benefits. Tax implications from being in domicile in Cyprus because the tax authorities in Spain tax you from your main activity. And I think this is not going to change too much. I think the important thing that will happen is that we will be subject to be included in the index in the main market, which means we'll provide a higher liquidity for our shareholders. Of course, also being in Spain, we have seen a huge support from the Xunta de Galicia because it's quite an initial company traded in a market like London, has a social domicile in Xunta de Galicia and not even in Madrid. And this has been very welcome. And actually, I can report that we have a full support of the authorities to a level that you cannot imagine. I mean we achieved basically meetings and results with full collaboration with the authorities. The last question comes, is E-LIX total recovery is 70% for flot and 80% for E-LIX is [ 56 ]? No, actually, for flotation, it will be around 70% to 75%, and E-LIX will have around 95% of recovery. So the global recovery will be over 85%. So basically, the recovery from E-LIX is [indiscernible]. Sorry, I see we have a new one. Are the points in development progressing as expected? I suppose you mean exploration. Well, exploration is never as good as we expected. We always expect more to make the next discovery. But let's say that the progress is enough to justify the Board to approve a good budget and the confirmation of the budget and to have several rigs going and drilling extensions, mainly in Masa Valverde, but also some [indiscernible]. So let's say that it's very early to say results, but they are good enough to say that we continue with pretty good expectations. And also, by the way, we are also going to start exploring in Touro, which also means that probably we'll be able to expand our resource in the future. So that concludes the presentation and the questions. And any questions from the table?

Let's talk about Masa Valverde given the high-grade opportunity to [indiscernible] economics for it, potentially a very, very strong and stronger in Touro. Is that a fair assessment, but am I miss something? Sorry, now if it is a fair assessment, is there a reason why [indiscernible] try fast track at Masa Valverde ahead of Touro?

Well, I think things are totally separate because they are in different districts. But if something in this company is that we move very fast. And we only got the permits of Masa Valverde last year, and we have already been drilling the technical drill holes to start construction of the ramp. I expect to take to the Board at the end of year the award of the construction of the ramp. So yes, we are going to develop that project in parallel to Touro. Actually, it doesn't mean they are totally different orders in the North part of Spain, while Valverde will still require a construction of around 2 years in order to get to the big parts of the deposit. The deposit at Masa Valverde is a large sulfide deposit, which contains some lowest rates overall. But then within it, it contains some good grades of copper and some new grades of zinc. Initially, the ramp will be pointing and going towards the area with copper, where we can just throw in the copper extracted by a contractor throw it in our plan with very limited investment. But yes, we are developing that. We are working on it, and we only got the permits last year, and we're already working to start actually this year. So we move quite fast, and we are drilling there as we speak.

[indiscernible] about the CapEx over the next couple of years. So this activity you planned for the next 2, 3 years, is the [indiscernible] and funding requirement?

Yes. Look, we -- CapEx -- we have given some guidance for this year, but in rough terms, looking at the beyond this year, we have the main consumption of CapEx, obviously, which is not included in this year is the total book. If we see that we can get the project permit, let's say, at the end of the year, which is most of the listed case, investment will be around EUR 250 million in 2 steps. The first step will be slightly less than EUR 200 million. And the next expansion -- small expansion, small change 2.5 years later. So we will be seeing around EUR 250 million in the next 3 years and starting next year. But with the first one around EUR 200 done in 18 months. And that's a big investment. In the case of investments in our production site, like Riotinto, we have this thing of Masa Valverde, which will be along 3 years because there's a certain speed, you cannot go faster than that. And let's say, roughly, it's around EUR 20 million, so you expect another EUR 10 million each year because that's you cannot speed much and doesn't require any plant or so. Besides that, we will continue having normal exploration of roughly around EUR 10 million a year and depends on the results of the E-LIX, we may construct a facility for extraction of zinc, which has to be constructed in the next 3 years. So I cannot tell exactly when it's going to be. EBITDA was around $75 million. That's still work in progress, and we are looking at all the designs. So that's roughly what we will have in the next 3 years, unless we have a huge discovery and adaptive plans in the year.

Any other questions? Good. Thank you. Well, before I close the meeting, I think it'd be remissive of me not to say just a few words. This is my last -- my 10th and last appearance as Chairman of Atalaya. I'd like to say I've been -- I'm very proud to have spent 10 years as Chairman of Atalaya. I have been very privileged to support Alberto and play perhaps a very minor role in the attainments of the company over all of those years. When I -- when Alberto joined the company or I tricked him into coming into the company, we had, in fact, no concession, no permits, no funding, nobody, no money, and he still joined the company. And over the 10 years, ably supported by Cesar I have to say, sitting opposite to me here, which turned into a company which had 4 million throughput, plant throughput producing copper, which has raised a 9 million tonnes a year throughput up to a 15 million tonnes a year throughput, which is now looking at 16 million above nameplate capacity, producing 50-odd-thousand tonnes of copper a year. I mean it is some attainment from a period of no permits, no funding, not even a concession. And I'm very privileged and proud to have been part, a small part to that, a very small part to that, supporting better from a long way behind it. I'm handing over to Neil -- to the safe and capable hands of Neil Gregson from now on. So he'll be here, taking over the meetings. I'll be at the other end of the table supporting and possibly asking questions, but always supporting the company after all this time with them. So -- and I'd just like to thank everybody for a wonderful 10 years, not only the Board, but the advisers, who we've known now for so long, the advisers and good friends of the company that have kept us going for so long and supported us. I think it's time for me to go because I don't know if anybody noticed I forgot to read the Chairman's statement at the beginning. But everything in fact in there was included in the CEO's report. So I think it would have been a repetition if I had read out. But if I would just finish that reading Chairman's statement of, and I'll read it because the last statement said, I'd like to take this opportunity to express my appreciation for the continued dedication and commitment of the management and staff of Atalaya. At the same time, I would like to thank all Board members for their support, guidance and continued engagement with all aspects of the company's activity and to also, of course, big thanks to our valued shareholders for their continued and appreciate their support. So essentially, that's me bowing out and saying thank you very much to everybody. Thank you. And I'd like invite you all to stay on and join us, of course, for refreshments, I hope. Have we got refreshments before we offer actually and discuss on a more informal basis with particularly [indiscernible] at your will.

That's great. To the Board of Atalaya Mining, thank you very much indeed for your time this morning. If I could please ask investors not to close this session as we'll now redirect you for the opportunity to provide your feedback in order that the company can better understand your views and expectations. So take a few moments to complete. I'm sure it will be greatly valued by the company. On behalf of the Board of Atalaya Mining Plc, I would like to thank you for attending today's Annual General Meeting. Good morning to you.