Australian Strategic Materials Ltd (ASM.AX) Earnings Call Transcript & Summary

Thank you. I'm Ian Gandel, Chair of Australian Strategic Materials, and it's my pleasure to welcome you to the 2024 Annual General Meeting of our company. I'd like to start by acknowledging the traditional custodians of the lands upon which we are meeting and pay my respect to elders past and present. I also extend my respect to Aboriginal and Torres Strait Islander people here today. I'm joined today by my fellow Board Directors, Nick Earner, Rowena Smith, Kerry Gleeson, and Gavin Smith. Also in attendance are Annaliese Eames, Chief Legal and External Affairs Officer and Joint Company Secretary; Stephen Motteram, ASM's CFO; and Dennis Wilkins, Joint Company Secretary. Auditor, Helen Bathurst of PwC, is also in attendance. The formalities of today will follow the common format for general meetings. Voting will be conducted by way of a poll on all items of business. A polling card should have been provided to you on entry today. If you've lodged your votes by submitting a proxy vote form prior to the cutoff time and you would like your proxy votes to stand, you do not need to take any further action. Completed polling cards will be collected by a representative of the Automic Share Registry at the conclusion of the meeting. Those shareholders in attendance that are entitled to vote on the poll are all shareholders, representatives and attorneys of shareholders and proxy holders who hold yellow voting cards. If you are attending in more than one of those capacities, you will have been issued with as many voting cards as you have separate capacities. If anyone believes they're entitled to vote on this poll in any capacity and does not have a yellow voting card, please raise your hand now and a member of our share registry team will assist you. Thank you. At the appropriate time, I will ask you to mark your vote for the resolution on the yellow voting card. If you are a shareholder and wish to cast all your votes for a resolution, please mark in the for, against or abstain box next to that resolution. If you wish to split your votes, please write the number or proportion of votes you wish to cast in the corresponding for, against and abstain box. Please note that the sum of the split votes must not exceed your total holding. If you are a proxy holder, a summary of the votes to which you're entitled has been attached to the voting card. If the summary of votes includes discretionary votes, these are yours to cast at your discretion. If you wish to cast the discretionary votes, please place a mark in the corresponding for, against or abstain boxes. If your summary of votes does not have any discretionary votes, you do not need to mark your voting card and will simply need to hand it to the returning officer at the end of the resolutions. After all the resolutions have been read and voted upon, please place in one of the ballot boxes that we'll be circulating in the room. Are there any questions in relation to the voting process? Thank you. There will be an opportunity to ask questions on today's business after all the resolutions have been put to the meeting. I will address any written questions submitted by e-mail from those who are unable to attend the -- to be present here today during question time. I will either deal with the question personally or ask somebody that's better placed to respond. We will do our best to answer any relevant question raised. I ask that you keep your question short and to the point so that as many shareholders as possible have a chance to ask questions. All questions will be addressed prior to the conduct of the poll, and the voting results will be posted on the ASX announcements platform later today. As a quorum is present, I declare the meeting open. Proxies have been inspected and all those validly lodged have been accepted. The proxies for each item of business are now displayed on the screen -- they will be displayed on the screen. Thank you. I declare that as Chair of the meeting, I will be voting any available open proxies in favor of each resolution. Further, I inform shareholders that the minutes of last year's AGM have been adopted as a correct record of the proceedings of that meeting. The minutes of the previous meeting are available for inspection should any shareholders wish to do so. Please contact me after the meeting if you wish to do this. I will now move to the business of the meeting. The first item of business is consideration of the financial report for the year-ended 30th of June 2024, which is now tabled. Thanks, Dennis. The auditor, Helen Bathurst of PricewaterhouseCoopers, is available to respond to any questions on the financial report or the audit, and they will be addressed later in the meeting during the allocated question time. We will now proceed to consider the proposed resolutions on today's agenda. The first resolution is the adoption of the remuneration report. This resolution is set out in the Notice of Meeting and as displayed on the screen, along with the proxy votes received for this resolution. I put that resolution to the meeting and move to the second resolution. The second resolution is the reelection of Mr. Nicholas Earner as the Director of the company. This resolution is as set out in the Notice of Meeting and as displayed on the screen, along with the proxy votes received on this resolution. I put that resolution to the meeting and move to the third resolution. The third resolution relates to the renewal and adoption of the company's short- and long-term incentive plan being the ASM performance rights plan, the grant of any performance rights under the plan and the issue of underlying shares of such performance rights in accordance with the plan. This resolution is as set out in the Notice of Meeting and as displayed on the screen, along with the proxy votes received on this resolution. I put that resolution to the meeting and move to the fourth resolution. I refer you to Resolution 4, which relates to the approval of amendments to the terms and conditions of the existing performance rights plan. This resolution is set out in the Notice of Meeting and as displayed on the screen, along with the proxy votes received on this resolution. I put that resolution to the meeting and move to the fifth resolution. Resolution 5 relates to the approval of termination benefits to members of the key management personnel and managerial or executive officers. This resolution is as set out in the Notice of Meeting and as displayed on the screen, along with the proxy votes received on this resolution. I put that resolution to the meeting and move to the sixth resolution. I refer you to Resolution 6 regarding the grant of $5,870,952 financial year 2025 short-term incentive performance rights to Ms. Smith. This resolution is as set out in the Notice of Meeting and as displayed on the screen, along with the proxy votes received for this resolution. I put that resolution to the meeting and move to the seventh resolution. I refer you to Resolution 7 regarding the grant of $587,952 financial year '25 long-term incentive performance rights to Ms. Smith. This resolution is as set out in the Notice of Meeting and as displayed on the screen, along with the proxy votes received for this resolution. I put that resolution to the meeting and move to the eighth resolution. I refer you to Resolution 8, which is a special resolution. Resolution 8 regards approval for the company to have the additional capacity to issue equity securities totaling up to 10% of the issued capital of the company. This resolution is as set out in the Notice of Meeting and as displayed on the screen, along with the proxy votes received on this resolution. I put that resolution to the meeting. As that covers all of the business for this meeting, I'll now put those resolutions to the meeting and open up the floor to questions. Question time. Do we have any questions? No questions. Thank you. So just to be clear, are there any questions for the Board or for the auditor on the financial statements or the conduct of the audit? There's not. Thank you. So if there are no more further questions from those present, Annaliese, have we received any written questions from shareholders?

We haven't.

We haven't. So thank you very much. As all questions have now been addressed, we can now conduct the poll. As mentioned earlier in the meeting, if you'd like your proxy votes to stand, you do not need to take any further action. If you have not lodged a proxy vote and wish to have your vote counted or if you are in the room and wish to amend a proxy vote already lodged, please complete your vote -- your polling card and hand it to the Automic Share Registry staff acting as the returning officer for today's meeting. Okay. Thank you. I now declare the formal part of today's meeting closed and thank you for participation. The results of the meeting will be released to the ASX announcements platform later today. I'm now going to hand over to ASM's Managing Director, Rowena Smith, to provide an update on the company's results for the year and an insight into what we can expect for the year ahead. At the conclusion of Ms. Smith's presentation, there will be an opportunity to ask questions.

So thank you, Chair, and thank you to those that have joined us here in the room today and all of you that are on the web service as well. It's a real pleasure to be here today to be able to just speak to the work that we've been doing in ASM over the last 12 to sort of 16 months and share with you what we have got focused on as we go forward into FY '25. I would like, just before I start, just to acknowledge the team, because ASM is a team and I'm very, very grateful for the work and support that I get by my executive in particular. We have 2 members of executive that joined us during last financial year. The first being our Chief Financial Officer, Stephen Motteram, who leads our finance team as well as all the work that we're doing on funding, securing funding for the project and for the business. So that's Stephen at the end there for those who are in the room. And then Chris, who had joined us just prior to the AGM last year, but Chris Jordaan, who is our Chief Operations Officer, leading our projects in both Australia and Korea and very busy with some of the optimization work, in particular, that we're going to be talking about today. Chris and Stephen joined the rest of the team. So Annaliese, our Chief Legal and External Affairs Officer; Vice President, Risk and Corporate Services, Agi Carrabs, who is -- in addition to the risk and sort of corporate services, it's a broad portfolio, but one of the particular things that Agi leads for us is our ESG approach. And not in the room today, but I know joining us on the webinar is Peter Finnimore, our Vice President, Sales and Marketing. He is in Brisbane today, but he is leading our sales and marketing effort as we establish our offtakes for both Korea and for Australia. So just to go into the work that we are collectively doing, we do have a little video to show you highlights. And I'm going to just run that now. [Presentation]

So these are standard statements, introductory statements that we make. If you would like to read them, I would encourage you to go on to our website. We did post this presentation earlier today. So you can read those at your leisure. But to get on with the story that is ASM, we're building a rare earths and critical minerals business to provide those high-tech metals that the world needs to be able to make the clean energy transition. And we have a strategy that takes us from mine all the way through to metal, starting with our advanced project in Dubbo, where we will be mining and refining the products to high-purity oxides which we can then take through one of our metal's plants through to final products, the first of which we've already built and is in production in Korea. And really, the intention is that this becomes a supply chain through to all of those advanced manufacturing industries globally, both our own product going all the way through, but also that we provide a pathway to market for other producers both at Dubbo, which can potentially be a hub for other concentrate or carbonate producers here in Australia, as well as our metals plants. Both Korea and additional metals plants that we may build in other jurisdictions in the future can be a hub for other third-party oxides, again, to give them a pathway to that market. So how have we been progressing against that strategy? Well, we've been doing it in a year that has definitely had its challenges, but one of the real tailwinds that we've had through the year has been the strong government policy development that we've been seeing globally. It starts here in Australia with a number of strategic bilateral compacts that have been established through the year. The positive engagement to drive investment and collaboration led by Minister King really has had momentum through this year. We've seen it with the Australia-U.S. Climate, Critical Minerals and Clean Energy Transformation Compact as well as the Critical Minerals Task Force that was established just prior to our AGM last year and has really been progressing well through the year. But we've also seen MOUs signed with the European Union for strategic partnerships to build these sustainable, critical and strategic mineral supply chains. We've seen a joint statement with Canada there, just to name a few of the countries that Australia has progressed these bilateral compacts with this year, as well as the Minerals Security Partnership, the MSP, which is a collaboration of 14 countries and the EU to catalyze those public and private investments in responsible critical minerals supply chains globally. And the Dubbo project was one of the first projects that Australia nominated for that MSP, and we've definitely seen the benefit of that profile in the discussions we've been having globally. The Australian government has also over the last year established a number of other investment pathways. It was just before the AGM last year that the Australian federal government had announced an additional $2 billion of funding with the Critical Minerals Facility. The National Reconstruction Fund has been established through this year, and, in fact, just recently, we saw the first of their funding announcements coming through, as well as the International Partnerships in Critical Minerals Program that Minister King's office managed this year. So Australia has been very active in this space, but we've also seen an increasing amount of international policy in this area, a combination of sovereign funds, defense funding, tax credit systems, tariff policy across jurisdictions. So as we go through the presentation, I will be talking about what we have been doing to really leverage that momentum for ASM. But it's been happening alongside a very slow-moving end market. That evolving end-user market has definitely been slower than we anticipated. Firstly, the consumer uptake of electric vehicles, we're really seeing that uneven in the short term. Directionally, it's still strong and people still have very strong expectations of it on the medium to long term, but the short-term take-up has definitely been variable. There are some regions where it has surged as the local policy really has given support either in policies or subsidies that support that sort of local production. So namely Europe and China, we have seen that moving. But factors such as cost and the charging infrastructure and some of the competition around government incentives has impacted in other jurisdictions and just it has created some consumer anxiety around really adopting those new technologies. So we are seeing those challenges directly impact on the demand for the rare earth elements that are used in those electric vehicles as manufacturers are just trying to balance the production with market demand in the short term. The scaling of the wind energy sector has also been growing at a slower rate than we were hoping for. It is growing as the world is moving towards meeting those renewable energy goals, but it is facing hurdles such as lengthy permitting processes, land use conflicts and some grid integration issues that, again, just mean it's slowing the deployment of those technologies and reducing the short-term demand for growth. And we're seeing technological and supply chain uncertainties in many of these emerging markets as they encounter issues around inconsistencies in policies and just the very fact that the supply chain outside of China is very immature. So as I say, directionally strong, but slower take-up than we originally anticipated. We're also seeing this in a landscape of shifting geopolitical tensions. We have got China's dominance in the processing and exporting of these key critical minerals remaining a very significant challenge. Beijing has tightened the export controls on materials like gallium and germanium through the year as well as rare earth processing technologies. So that's definitely been impactful. But we've also seen a year of global conflicts. The Russia-Ukraine, the Israel-Palestine conflicts have continued to create a general uncertainty and unease that is definitely impacting on the markets. And it was an extraordinary year for elections. Around half the world's population lives in more than 70 countries holding national elections in 2024 with roughly 2 billion eligible voters this year. So it's been described as the largest election year in history. And we've certainly seen that impact, particularly the U.S. election. We saw a lot of waiting to see what the policy realignment might be depending on what the outcome was in the U.S., not just impacting in the U.S., but we're actually seeing in Korea, in Japan, in Europe, as well organizations that we're interacting with just going slowly, pausing, waiting to see what the outcome is of that election. And in fact, even just in the last 2 weeks, we have seen a resurgence of engagement in those processes as people are anticipating now more clarity in the new year in the U.S. All of these things combined, I think have put downward pressure on the commodity prices in the short term, particularly for neodymium and the related rare earth prices. So largely influenced by China's market dominance. We have seen a softening for demand in the EVs and the wind turbines, but also an excess of supply and inventory levels in China. So that is the global environment within which we have been working to deliver the strategy for ASM this year. So I'm very pleased to be calling out the highlights that we delivered within that context. We did through the year really lean into the opportunities that the government policy development was providing, and we were able to secure over $1.5 billion of conditional debt funding for the Dubbo project construction phase from the EFA, from U.S. EXIM, from the Canadian export credit agencies as well. And we have been focused on the optimization of the Dubbo project. So I will speak in more detail on both of these topics as we go through. But that successful optimization of the Dubbo project really focusing on how we can reduce the CapEx and OpEx for this project has been a strong area of focus. It was very encouraging to have the $5 million of federal government funding support just recently to help support some of that optimization work as well as the commitment in addition to the $1.5 billion for the construction phase, an additional just under $50 million of conditional funding from U.S. EXIM to help us with the final engineering work that is needed to be able to finalize those cost estimates to be able to take final investment decision. And that work was awarded to Bechtel. In Korea, we have continued to do the work with the emerging magnet producers to validate our products so that we know that we are making high-quality products that will meet their needs as their market grows. And so we've got 2 new potential magnet producers in Europe and Korea. Those processes were completed with during the year as well as a number of others that are in process. And we've continued our strong focus on our ESG, having achieved in a recent public rating by Morningstar Sustainalytics an ESG risk rating that ranks us in the top 10% of diversified metals businesses globally. So I do want to talk about some of these in a bit more detail, and in particular, I wanted to start with just a bit more detail around this growing momentum that we've been seeing for the government support. That photo there is a photo of the Critical Minerals Roundtable in D.C. that occurred just prior to the AGM last year. I was not long back from that when I met in this forum last year. And we have very deliberately focused very strongly on the momentum there in the U.S. that came as a direct result of that very senior government engagement between Australia and the U.S., really looking for how can we unlock the potential in the U.S. for ASM. I mentioned before about the mineral security partnership. We definitely are advantaged in this jurisdiction by how strongly the Australian federal government has ranked the Dubbo project and has been promoting us at senior levels. When I was there in D.C., I spoke with the ambassador right at the time, and he was anticipating then that we were going to see an extension of the U.S. Defense Production Title III Act to include Australia as a domestic source. That did come through at around about Christmas time, and that has then enabled us to be able to progress a number of discussions with the U.S. Department of Defense about potential offtakes and potential funding for Dubbo. One of the things that the U.S. defense then did is they established a consortium of their defense industrial base, and we were invited to be a member of that consortium and we went to the inaugural -- DIBC is the acronym, but it's the Defense Industrial Base Consortium. We went to their inaugural meeting in the States in the middle of this year. It is like a alphabet soup being in those forums. Everything is a number or a 3- or 4-letter acronym. And so what was really beneficial about being in attendance there was that we had an opportunity to build relationships with those that are going to assist us to navigate all of these different processes, particularly as the policy continues to emerge. But what they were also doing very deliberately is they were introducing the various different companies who are along those supply chains to facilitate the collaboration along those supply chains to be able to build their supply chain all the way through to meet their needs. And so that's been very productive for us as we have been exploring the offtake opportunities. Some of the tangible outcomes from that engagement in the U.S. that would already be in public domain is the investment support that we've seen from U.S. EXIM. That is, in the first instance, just over $900 million of conditional debt funding that U.S. EXIM has offered us for the construction phase of the project, which is the largest offering that U.S. EXIM has made for any rare earth company, or I think indeed any company in Australia for critical minerals production. So that's been a huge win for us, as well as, as I said before, that additional funding support for the last phase of the engineering work that we wish to complete before taking final investment decision. We have been progressing with the Department of Defense white paper submissions to be able to access some of the Title III funding. The Title III funding is grant funding as opposed to the U.S. EXIM's debt funding. So we're very keen to secure the Department of Defense funding. We've got 2 submissions in process at the moment, considering funding for the construction phase. And we have been actively encouraged by the Department of Defense to prepare a third submission, which will be submitted prior to the end of this calendar year, looking for grant funding to replicate the facility that we have in Korea in the States. Which I think then goes to the last sort of column there around what we see as the onshore opportunities in the U.S. We have been exploring locations for a second metals plant, not just in the U.S., we've been looking globally at what's competitive. And there are a number of factors that you take into account when you're looking at which is the right jurisdiction beyond the Korean facility that we already have if we're seeking to expand. But the U.S., just again just prior to the election just announced their new tax credit, the 45X, which is an advanced manufacturing production tax credit for rare earth materials and products that are made from rare earths. And that will be a significant motivator and will reduce that competitive gap that the U.S. has had up until now relative to some of the other jurisdictions like, for instance, Vietnam by way of example. What we also did through the year is that we attended a conference in the States. We were invited to participate in a conference that is -- I always get this wrong. Annaliese, is it SelectUSA or USASelect? SelectUSA. There we go. Which is a conference that is held where all the various different states come and really lobby for your investment in their state, and they take you through all of the different investment incentives that they offer. And so we've got a process underway now, where we've really been looking very hard at if we go forward and build a facility in the States, which would be the most advantageous of the jurisdictions, which states would be the ones where we will get the most support from government. So we've been working very hard in that jurisdiction to position ourselves so that now as we do have an outcome of the election and we are going to see that change of government in late January, that we're really positioned very strongly to be able to come out into the new year very quickly as we start to get clarity around the policies and as we see the end market starting to respond to that. One thing that we are very confident about is that the change in government is not going to be detrimental to ASM. We have seen in Trump's previous administration -- it was under his administration that U.S. EXIM regained its mandate to be able to do the kind of work that they're doing to support us. And we have seen a very strong commitment to local supply chain development and defense spend from both the previous administration when Trump was President, but also in all of the election campaigning, those policies were very strong. So the specifics of it we will see in the new year. But again, we are only full of optimism about what we're going to see in the new year. It's not the only jurisdiction though. We do have a global program of looking at where we will see support for these alternative supply chains. And you can see that in the graph over there with the conditional debt funding, yes, we got over $900 million from the U.S. this year, but we also got $400 million from Canada to go with the existing funding that the EFA have supported. So the 3 jurisdictions that we operate in are obvious areas where we've continued to have very strong government engagement, in Australia at a federal level, but also at a state level, and in Korea. The federal government, as I said before, have been working through with the Critical Minerals Facility. And that's the EFA that manages that facility. And so that strong relationship that we already have with the EFA, we continue to invest time in, in order to be able to get access to those funds. Their statement to us is that they're there to support us as we mature the funding stack. So as we get closer to the end of the funding, that we can come back to them. And they pride themselves on having flexibility that they can provide whatever is the best fit for whatever gap we've got as we progress the rest of the funding stack. The National Reconstruction Fund, as I mentioned earlier on, we've just seen the first announcement from them just in recent weeks of their funding coming out from -- they've got $1 billion dedicated to supporting critical minerals companies in Australia. They do have it in their mandate to be able to provide equity. We're really keen for them to use that mandate. They're showing a bit of hesitancy on that at the moment. And I think the first funds that we see coming out from that particular fund, I'm sure, will be a more traditional debt type of tool. But again, we are strongly engaged there and talking to them about what the opportunities are for the Dubbo project. And then just yesterday, the federal government have tabled a bill for legislation for the Australian tax credit. So the equivalent of that 45X in the U.S. coming into Australia to provide a 10% tax credit for critical minerals businesses up to the first 10 years of their production between 2028 and 2040, which will be directly relevant for our Dubbo project. We've been working very closely with the New South Wales government through the year as they were reviewing and updating their critical mineral strategy. There was a consultation process that we were very active in. So we were delighted when that was announced again just last month that -- a lot of the policy was very similar to the policy that was in place before, which is good because that was the policy that was needed. But one of the new initiatives that we're really pleased to see is that they have announced a deferral of royalties for the first 5 years for projects that come into production prior to 2030. And that, for us, again, directly relevant for Dubbo. And we see that as being a really helpful initiative from the New South Wales government to support these projects in their early years of operation. It is a policy that we don't see in any other state in Australia. So that is leading practice from New South Wales government, which we're very grateful for. We continue to engage in Korea with government there. And again, just in September, the Korean government announced a new Supply Chain Stabilisation Fund, which we are talking to them about both the potential for that to help fund expansion of the Korean metals facility as well as potential for that to be able to be accessed for the Dubbo project in order to have that supply chain of materials going into the Korean Metals Plant. And whilst we do focus on the jurisdictions of our operations, we are also continuing to engage more broadly. And in the European countries, in particular, I would just call out 2 new sovereign funds that have been established through the year. Both the InfraVia and KfW are managing funds for France and Germany that would be, again, directly available to us if we have offtake partners either from Dubbo and/or through our Korean metals facility to be able to access funds from those facilities as well. So the discussion around funding, whilst a lot of that is still in conversation, in process and not something that you would have seen announcements about as yet because we don't have outcomes on that as yet, I can tell you the team has been working extremely hard to be able to position ourselves to be able to leverage that very strong government support that we're seeing globally. All of this is in aid of getting our Dubbo project into construction and into production. And as you would all be very familiar; this is a fantastic project that we have here in Dubbo. It is long life. It has great financials. It's in a fantastic jurisdiction. We have done comprehensive work with ANSTO on developing the flow sheet, and we have very, very strong ESG credentials for it. So really, the challenge for us continues to be focusing on funding and offtake as we go forward. So I just wanted to give you a bit of an update on what we have been focused on here in the last 12 months. We have seen with our peers that they've really been impacted on escalating CapEx and OpEx. And this is something that we have been acutely aware of and really working on what can we do to offset that. So one of the areas that we progressed and completed this year was an estimate on the nonprocessing infrastructure. We hadn't done detailed engineering work on that prior. So we did early in this year award that work to Bechtel. And that work has been progressed and completed, which is very helpful for us as we move forward. And we also awarded a further contract to Bechtel to do the final engineering work with the support of that funding from U.S. EXIM that I referenced before. But before we initiate that work with Bechtel, we want to make sure that we are moving forward with the optimal flow sheet. And so there has been work going on through the year on really challenging ourselves on, is there a simpler flow sheet? Is there an opportunity for us to remove kit, remove CapEx, remove reagents, which would have a direct impact on the OpEx for this plant before we launch into doing that final engineering and commitment. So some of the wins that we've had there through the year, one in particular is the zirconia and hafnia circuit, where we were able to successfully demonstrate that we can make not only the existing volume of product, but actually, we can see a much higher volume of hafnia having simplified the process circuit and done something very clever that the technical team came up with. We've come up with a way of increasing the volume of hafnia to what was in the original plan while still maintaining the rest of the product suite at lower capital cost, at lower OpEx. And really importantly, we were able to demonstrate its really high purity. So as we've been talking to the defense suppliers, what we have learned is that there are a number of emerging technologies, particularly in the semiconductor industry that are really interested in hafnia and would like to be able to use it more if they thought they could access the volume, but also if we -- if they could access it with really low trace elements of zirconia. So what we were able to do through the year with those trials is we were able to make samples that we're now able to provide to those suppliers to demonstrate that we are able to make those materials at that quality and that we have the potential to be able to grow our production as that market grows. We also did work on the niobium circuit to simplify the niobium circuit and also were able to confirm that we have been able to lower the CapEx and OpEx requirements for the niobium circuit. And the third area of ideas that the team came up with was the rare earth optimization. And that's the piece of work that is currently underway that we are using the $5 million from the federal government that was awarded just last month to assist us to complete. And I am excited about the opportunity here, because whilst we're still in early phases on this and I don't know yet whether this one works or not, if it does work, then this not only gives us an opportunity to reduce CapEx and OpEx, but potentially it gives us an opportunity to phase the project so that we could do a first phase and get the rare earths into production first and then do the rest of the product suite as a second phase, which obviously would be an easier pathway through to completion of the total project, give us a lower capital hurdle to get started and be able to get into revenue generating, which will help fund the second phase of the project. So this is an important piece of work for us to be able to do prior to finalizing the scope for Bechtel for the final engineering. The work we're doing is, first of all, a metallurgical processing piece of test work, but we wanted to have fresh core for that. So the first thing we did was actually get a rig out and drill 6 new drill holes. And that's been completed. That core has now been prepared for that test work and that test work has commenced. But that test work will go through until early next year. So we will be able to confirm what those results are for our internal work in first quarter of next year. And in parallel with that, we have DRA Global doing work on that alternate front end for the flow sheet, what the alternate CapEx and OpEx would be. So that work is happening in parallel, also anticipated to be complete for us in first quarter of next year, which will allow us then to be able to do a business case. And we're hopeful that by the end of first quarter next year, we'll know whether or not this is a viable alternative for us or not, which will then enable us to be able to lock in on what the scope is for the final bit of engineering work for Bechtel and get on with that final bit of work. We are anticipating with that fresh core that, that will also give us an opportunity to update the reserve and resource statements. So we're also hopeful that, that will give us an updated statement in first quarter of next year as well. So all of that keeps us on track for being able to take a final investment decision in mid-'26 and have first production in '28. If we are going with the phased approach, the ramp-up of that first phase would be much quicker than the ramp-up of the full facility. But we will know more about that in the new year when we've got this test work complete. In the meantime, our Korean Metals Plant is a facility that we are very proud of. And the team there, despite the challenges of a very soft market in the short term, continue to work very hard on increasing their product range, both in the alloys that we have available and validated by customers. Because you might remember each customer has its own specific alloys. So these are not standard products. There's a lot of development work that goes into both developing the capability, but then validating them with those various customers. As well as we are broadening our product range into the heavy rare earth metals as well. So I said before, very excited about the acceptance that we have from the Korean and European customer. The Korean customer is an emerging customer, but the European customer is an established magnet producer already in production. So that's been really pleasing that we have been able to get those validations complete. And it's given us real confidence that as we engage with other new customers, that we can really speak to our confidence in the quality of our product and the fact that we know that it makes very good magnets. We have been working hard on those processes across jurisdictions, Korea, U.S. and Europe, with established but also emerging magnet producers. And what it is giving us is really good intel into actually how the market is developing at the moment. And whilst we're positioned very well with those magnet producers, the primary feedback we're getting at the moment is that they are positioning themselves for anticipated growth through '25 and '26, but they're still anticipating that, that growth is going to be slower than they had hoped for when they were initially doing their investments into their magnet facilities. So I think we're still going to see this ramp-up going slowly over the next 12 months, but we certainly are positioned well relative to others to be able to take advantage when this market does take off. And I said before, we are working on developing our product suite. So there's a lot of work at the moment doing the final trials for the dysprosium and terbium metallization in that facility, preparing for commercial production in 2025. All of that work does keep us very busy, but our commitment to our sustainability portfolio remains. And I just thought I would call out just a couple of highlights from the year. We did through the year see the Toongi Soil Carbon Project registered under the Emissions Reduction Fund. This is really exciting for the team there at the farm that we have there at Dubbo. They came up with this idea of farming carbon into the soil essentially and have now had it confirmed by the agency that reviews this that we are eligible now for Australian carbon credit units, ACCUs, for the carbon that we basically hold in the soil. So they take a measure of it at the beginning of the period, and then we do various different farming methods to capture the carbon in that soil, and then they come back, and they measure it again after a period of time and we get credit for the increase in the carbon in the soil. We're working with Australian Soil Management on that and, yes, really pleased with the opportunity that we have there to be doing something really innovative on that property. Similarly, we're using the opportunity that we have there with regenerating some of our land there that's not directly in use for either farming or for the processing to do a biomass project. So we are working with the New South Wales government and their Climate Change Fund on trialing the planting of various different gums and mallees that can then be used for biomass as a potential energy -- renewable energy source for the project going forward. So that also is underway. And as I said before, we have a comprehensive program for ESG. So that Sustainalytics rating that we got through the year is an improvement on what we saw last year. So we're continuing to strengthen our position. We are in the top 10%. What that actually means is that we were ranked 17th globally out of 230 global businesses that were assessed by Morningstar across all aspects of ESG. And that includes companies like BHP and South32 and others. So for us, at this stage in our life, at our size, for us to be ranked so highly in that is something we're very proud of. So our focus areas for FY '25 are to continue to progress those funding and offtake opportunities for Dubbo project and, importantly, complete this work on the rare earth optimization or the options assessment to see where the opportunities are to reduce cost and, importantly, see whether or not we can actually phase this project, which would give us a lower complexity first step, which would be definitely beneficial if it's possible. We are continuing to grow our product suite and working with the market there and KMP in order to support that ramp-up. And through all of this, we are continuing to have very tight cash management. It is nice -- we finished the last quarter at $38 million cash, which is a good position to be in. We've obviously got the additional $5 million of funding that have come in from the federal government since. But we are very, very conscious that we're trying to do a lot of things and that we have to do this in as tight a cost management as possible. So the team are very disciplined about that, whilst at the same time, maintaining our commitment to our ESG principles and the sustainability of our operations. So that is a summary of the year that was and the year that will be, and I'd be very happy to answer any questions. Greg?

I was going to ask about the equity with the government, but also an equity partner. Are you still looking for an equity partner?

We are. So when we're talking to offtake parties, we still do absolutely talk about equity. One of the things we've seen, though, is an increasing desire for those businesses to work with the sovereign funds. So what we're seeing is that, for instance, if we're talking to a German offtaker, then the German offtaker is talking about taking offtake and then perhaps facilitating for us to get equity contribution from that sovereign fund rather than it necessarily coming off their balance sheet. So again, this is -- there's a lot of fluidity about this at the moment because the sovereign funds are new and because there's still that uncertainty about what the pace at which these end markets are going to grow at. So I think we'll see that continue to mature over the next 6 to 12 months. But yes, absolutely talking about equity support with the offtake partners, whether or not it's directly from them or whether it's from their government.