Exxaro Resources Limited (EXX) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. Thank you. Good morning, again, ladies and gentlemen and welcome to Exxaro's 2026 Capital Markets Day, and thank you for joining us today, both in person and online. To all our shareholders, the investment community, business partners, our colleagues, we welcome you. My name is Anda Mwanda, the Manager of Investor Relations at Exxaro, and I have the privilege of facilitating this session today. But before we begin, here's just a brief safety announcement that we'd like to make. Please note that we have not planned any emergency drill for today. If the alarm is activated, please remain calm and wait for the Exxaro Flow Marshals, wearing red reflective vest to lead you to the assembly point. It's in front of the building, at the parking area where the roll call will be conducted. We will all remain at the assembly point until instructions are issued to reenter the building by an Exxaro safety official. If you feel unwell at any time, please inform your host, who will escort you to the on-site clinic for medical assistance. In the event of this situation, please note that visitors should always be accompanied by their host. For our [indiscernible] of facilities, if you exit the auditorium, you will turn right, the ablution facilities are clearly marked, and they will be on your passage to the left. In terms of the use of cell phones at Exxaro, we do not allow people to text while working. Therefore, if you receive a call or a text, please move to a safe space and answer your call. And please would kindly request that for this session, all cell phones are put on silent. Please take note of our disclaimer. Today's program provides a comprehensive view of Exxaro's portfolio. Our strategic priorities and the opportunities we see to create long-term value. We will begin today with a strategic overview from our CEO. This will be followed by presentations across Coal, Metals, the Renewable Energy businesses. After lunch, we will cover business development, our pathway towards carbon neutrality by 2050 and capital allocation. Earlier this morning, we released our FD pre-close message. Our Finance Director will provide additional context after the CEO at the end. We have built in several opportunities for questions and answers throughout the day, and I'll take you through this quickly. The first Q&A session will be after the call section. The second one after synergy, and then after decarbonization at the end of the Capital Markets Day. We will have 2 comfort breaks. The first one is after the Metal section. And the second one will be after decarbonization. At 1:00, we will have our lunch. The timing of comfort breaks and the lunch is as follows: all comfort breaks will be about 15 minutes, and our lunch session will be about 45 minutes. And thank you for your indulgence. And now to the business of the day, and to formally open today's Capital Markets Day and share his perspective on Exxaro's strategic overview. Please join me in welcoming our Ben Magara.

Thank you, Andre, and good morning, everyone. Thank you so much for joining us today. I realize some of your are online and some are here present with us today. We are very certain it's not because this was not -- this was the only option this morning. So we know you had so much and you do have so much on your own diaries. So just having you here from all the distances you have traveled and making the time online, we absolutely appreciate your continued interest in Exxaro. And thank you for joining us. So for many of you, a little bit older than some of us. I don't know -- I know what that means, but the last Capital Markets Day was hosted in 2021. So this is 5 years on, and we're very pleased that we're able to spend time with you today and it's your company, and we look forward to hearing your thoughts on it as well. So at the time, we introduced then in 2021, our sustainable growth and impact strategy. We outlined our ambition to diversify our portfolio and reposition Exxaro for a low carbon future. Today provides an opportunity to reflect on the progress that we have made against those ambitions and the changes in the environment since then, and how we have accelerated our disciplined execution of our strategy. And this always works within the context of the various macro and local macroeconomics that we all face today. I would like to share a few stories around the pictures you see on this particular Slide #4. It shows 4 pictures there, and they tell a full story. Top left is our leadership workshop of the Top 200 of this company, Exxaro, reflecting on our ambitions, reflecting on the culture, drawing the line, on ethics and making a clear and focused ignition on our culture and what excites us. That's the top left picture. On the top right, you will see a long train loading at CP -- loading manganese at CP. Bottom right is an anchor for a wind turbine. The diameter of that concrete ex coveted area is about 25 meters. There's still center takes about 16 tonnes of steel and the base itself takes about 60 tonnes of steel. So there's 76 tonnes of steel in there to anchor a wind turbine that will produce 6 megawatts at Karreebosch. It takes 600 cubic meters of concrete. The fourth one, which is bottom left is our solar plant at Lephalale. Now supplying 68 megawatts on a reasonably good intense day to our own operation. So we now have 68 megawatts of green electrons, a first in Exxaro to our own operations. You will see the 20th anniversary, and we're talking about how we are celebrating Exxaro for the past 20 years. We listed on the Johannesburg Stock Exchange in November 2006, and we have provided opportunities to many, to our own employees, communities and you name it. Exxaro provides opportunities for us to reflect on this impact that the company has given us today on this Capital Markets Day. We have gone beyond the minerals we extract, the resources we mine in the ore bodies that we mine. Our shareholders have walked this journey with us. Since listing, through your support, Exxaro has created meaningful impact over the past 2 decades. I'm not going through every number, but we thought this would be a wonderful read either as you fly back to Capetown or drive around with somebody, but we are really proud of the value we have created and the contribution we have made to our employees, to our communities and to the wider South African economy. These figures on this slide tell part of that story. They reflect a business that supports more than 20,500 employees, including contractors. Multiply that by 6 or 10 in terms of economic linkages and our contribution to society. We have invested ZAR 5 billion in the last 20 years, in lending and development, and we continue to do so to create opportunities through education, enterprise development and community initiatives. Underpinning all this is our unwavering commitment to safety. My 22,500 colleagues know our commitment to safety and to zero harm, ensuring that every employee and contractor or even visitor, as you would have had from Anda this morning and they are able to return home safely every day and we take that very seriously. A safe mine is also a profitable business. I cannot forget Tim Clark's last comments at our results in March. Where he says, if I see safety improving, if I see costs improving, I know the business is well, and we continue to focus in those areas. Consequently, we have created significant value for our shareholders, and Exxaro remains a consistent dividend payer with over ZAR 200 billion of stakeholder value created since our listing, distributing over ZAR 85 billion in dividends. Yes, please, You can clap at that. All that is a company that today is a ZAR 75 billion market cap company. I can remind you that at listing in 2006, we were ZAR 20 billion. Last year, January, February, we were ZAR 51 billion. It doesn't come without hard work. And while we are proud of what has been achieved over the past 20 years, today's Capital Markets Day is about the future. It is about how we build on this great foundation that our fore fathers and mothers did. It is about how we are accelerating disciplined execution of Exxaro's strategy. So on the next slide, #6. Before reflecting on that progress that I've shared with you, it is important that we possibly recognize the environment in which we operate. The world today is materially different, from the one we faced in 2021. Globally, we are seeing increasing competition for critical metals and as a result, increasing geopolitical fragmentation and paid realignment. However, headwinds for some commodities are also tailwinds for some. And most relevant for Exxaro, the coal we mine, stays the lifeline for NH security globally and even in our domestic market. We remain the lifeline, when trouble hits people run back to coal. And we can see today that even in the National Energy agencies and many experts highlight that coal will go beyond 2050. So we are seeing a pragmatic approach to this energy transition. And these trends reinforce the importance of the strategic choices that we have made. And as the world adopts a more pragmatic approach to [indiscernible] security, Exxaro's own long-life coal assets remain critical in supporting global and domestic energy needs generating cash flows, which are critical to invest in the future growth and the diversification strategy that you see us going through right now. And again, let me emphasize that we believe that the runway for coal goes beyond 2050. Ladies and gentlemen, I don't need to tell you that South Africa is endowed with world-class mineral resources, exceptional solar and wind resources and an established industrial infrastructure. In this business, we are encouraged by the progress being made through the reforms both in the energy and logistics sectors. I am, however, concerned about the relentless attack on our country's ethical fabric. And as Exxaro, we are doing all we have to keep the integrity of our supply chains. The imminent local government elections and the attendant service delivery challenges pause real short-term risks for us, and as a country. Our diversification is adding manganese and renewable energy to our strong core base, driving attractive long-term growth opportunities while our commitment to carbon neutrality by 2050 stays unchanged. And [indiscernible] weathering it making sure we are cover neutral by 2050. Through an accelerated and workable decarbonization road map and diversification of our earnings, we are reducing Exxaro's carbon intensity. So the diversification strategy is to add to call the manganese and future-facing minerals in order to reduce our group carbon intensity per earnings that we make. We are positioning Exxaro for the long-term relevance and sustainability in a long-term carbon future. Delivering on this strategy requires capable leadership, clear accountability and relentless focus on disciplined execution. So let me introduce our team as I go through this now to deliver on this next phase. You can see them all young and mature and agile. We had to create a structure and a team that's focused on the future that we want to deliver. And over the past year, we have strengthened our executive team and aligned the organization around strategic priorities. And today, we have dedicated leadership across each of the 3 pillars of Coal, Manganese and Renewable Energy. So those are our 3 profit and loss pillars. And the executives in charge of those, we all call them bosses because they bring the money. We also have strong functional capabilities in sustainability, in strategy, technical services, people and governance. And I think you can see Michelle, doing a lot of our heavy lifting on ethics and governments. Caroline Coal, Metals, year 1, Energy with Leon, [indiscernible] with sustainability, Richard with strategy and business development, Joseph with PMP or human resources and Mervin Govender, our technical services and fortunate with commercial. I deliberately left the men with deep pockets and short hands, because to deliver on this requires clear accountability and capital allocation framework, that is -- that has helped us deliver the dividends we are continuing to do so for the past 2 years, [indiscernible]. So this structure is aligned to our strategy. It enables efficient decision-making, stronger cross-functional collaboration and greater accountability for delivery. It is important that it has also strengthened both our leadership bench, but also our execution plans, ensuring that Exxaro has the capability to execute through this next phase of our growth. Ultimately, leadership is not measured in the structure I'm showing you. And my team knows that it is measured in the results that we deliver. Over the past year, this team has focused on restoring stability, strengthening the foundations and accelerated the disciplined and prudent execution of our strategy. So let me now turn to some of the key milestones and achievements that this team has delivered in the past year. We successfully concluded the Manganese transaction. We doubled our renewable energy business. We secured a long-term contract, Coal supply contracted matter. We advanced our logistics initiatives that support the long-term competitiveness and sustainability of our Coal business. And there are many I could highlight but also strengthen the resilience of our business by refinancing our largest corporate facilities, concluding also an insurance premium, a program on much more favorable terms. Importantly, we delivered on our commitment to shareholders. I remember standing here when we got many questions, Nomanja, Abishek and everybody we traveled around, whether it's in Victoria or Jorvik or Capetown, and they kept saying, what -- don't you -- just give us the ZAR 18 billion. We think we can do more with it. We had committed that we diversify the portfolio, and we have done that. But we also committed that we will not need the ZAR 12 billion to ZAR 15 billion cash that we had once we have delivered on the majority of the manganese transactions that we financed. And therefore, importantly, we have delivered on our commitment to shareholders that we will be reviewing our capital allocation framework and enhanced the dividend policy to turn more capital to our shareholders. Alongside these achievements, we delivered our best safety performance on record and maintained operational discipline. We continue to do the best work of our lives at Exxaro, because [indiscernible] wants me to say, because we dig Africa, Together, these milestones demonstrate a more agile and execution-focused organization. If you look at the next one, we just simply highlight the 3 portfolios. So we have simplified our portfolio through disposal of noncore assets, such as FerroAlloys, I will not still reach a standard about some of the assets we have declared to be noncore. Richard will talk about that. But we have also structured our team in these 3 focused business pillars. I must emphasize that we do see the Coal runway beyond 2050. Therefore, Coal stays the foundation of our portfolio. It is a long-life, high-quality cash-generative business that provides a defensive earnings base with exceptional export optionality. And Michelle Philips know this because I'm -- we talk on a weekly basis, monthly basis, and at morning or night if net needs to be because we -- Exxaro has the capacity to even double our exports, If the Rail logistics would work because that is the most cost-effective route to port. As we continue to generate the cash flow is required to invest in our future growth. So our future-facing mineral business, Metals business provides exposure to commodities that are essential as you know, to infrastructure development and also to energy transition. We are building a scalable business positioned for long-term demand growth and enhanced portfolio diversification. Leon and this Renewable team, our Renewable business represents an important growth platform, providing increased exposure to stable, predictable and inflation-linked earnings, while supporting South Africa's transition to a low carbon economy. Together, these 3 businesses create a diversified natural resource portfolio that balances cash generation, growth and sustainability. And underpinning these pillars is our foundation is our people. These are the glue, the nuts and bolts, the engine room that makes Exxaro tick. And they are unwavering commitment to safety and ethics and focused growth and focusing on impact beyond the surface remains our bedrock, which will catapu Exxaro on this next phase of growth that we have. These principles guide how we allocate capital and our people drive that. How we operate our assets and our people drive that and we create long-term value to all our stakeholders and our stewardship and our people drive that. As I get to a close from my introduction, I'll be back again as I conclude in the afternoon, the portfolio we are building is also changing the composition of our earnings. And this is quite an important slide for me, apart from the pillars that I showed you earlier. This slide shows how the various earnings from various businesses are delivering value to us. We all know, we also have equity accounted investments in iron ore and zinc. The addition of manganese and the growth of our renewable energy business strengthens the diversification of our portfolio. So looking ahead to 2030, from 2021, where Coal was provided the majority of earnings, we still expect in 2030, Coal to continue to provide the earnings that it continues to provide. However, looking ahead to 2030, we expect energy and our future-facing Metals to contribute more than half of the total group earnings, not by shrinking Coal but by growing others. So importantly, Coal stays the foundation of our portfolio, generating the cash flows required to fund the growth and support our shareholder commitments and returns that we've already highlighted. And as Energy and Metals grow, we will contribute a larger share of earnings from Manganese and Energy, including the iron ore assets I spoke about to enhance that diversification and drive the resilience of our earnings, most importantly, reducing the carbon intensity of our earnings profile. That's the aim for this diversification program. This shift reflects growth in this business is rather than a decline in Coal, as I said, and we expect Coal to remain a significant contributor to the portfolio, even as its share of earnings increases over time. Now going into the presentation of the day and how we are going to cover this morning. You will see that I've got numbers on deliver, diversified, decarbonize and impacting strategic levers and to deliver a number on people, which is our Slide #11. We know they say culture, it's strategy for breakfast. Thank you, [indiscernible]. Our people is our strength in safety, health and ethics are critical. We are creating a one Exxaro Way, with our culture programs, business transformation as we drive to standardize the group in order to make sure we have one Exxaro Way in every way we operate. So that's our bedrock. But today, we're going to focus on those 4 areas I've highlighted and showcase our leadership in those areas. So for me, it's really about introducing that team with Caroline coming through just now on Coal and Johan on Manganese. And then we will diversify with -- continue to diversify with Leon coming through on Renewable Energy and Richard doing business development. Neo will come through with decarbonizing impact what we are making and how we are impacting society and [indiscernible] will typically will then bring in the bottom line impact. So to take you through the call opportunities that we see ahead, I am pleased to hand over to Caroline Shirindza, our Executive Head of Coal. And as I said earlier on, just call her boss. Thank you.

Some of us are of normal height. Thank you, Ben. Good morning, everyone. My name is Caroline Shirindza and I look after the Coal business. Coal remains the foundation of Exxaro's portfolio. Ben has alluded to that. Coal still provides the cash flows that support shareholder returns, diversification and future growth. So today, I will take you through the market outlook, the strength of our asset base and the opportunities we see to create long-term value. So let me start with the global context. To better understand the long-term outlook for coal, we commissioned an independent assessment of global coal market fundamentals, drawing on the views of leading market customers. While these organizations that consulted with defining their assumptions and scenarios, they are broadly aligned on one point. The fact that coal demand is expected to decline over time. This is as countries advance their energy transition plans. However, the analysis also highlights that coal demand does not disappear. It continues to play a role in global energy systems well beyond 2050, particularly in markets where affordability, reliability and energy security, remain priorities. The most important finding is that supply is declining faster than demand. So as mines deplete an investment in replacement capacities on strained, significant new capacity will still be required for us to maintain supply. So the chart shows by 2050, only around 20% of today's mining capacity remains, 20%. So even in declining demand environment, approximately 3 billion tonnes of new capacity will still be required to replace depleted production. So turning to South Africa. We do acknowledge and appreciate that the energy transition is progressing, and it must. But this slide highlights an important reality for the South African energy market. While the integrated resource plan continues to forecast a gradual reduction in coal-fired generation, as we see renewables and alternate sources being introduced. The transition is admittedly slower than originally projected. The pace at which energy generation technologies are deployed remains very uncertain. So ladies and gentlemen, Coal still represents about 69% of installed generation capacity today, significantly higher than earlier forecast adjusted. So this highlights the reality that South Africa must balance is decarbonization ambitions with its immediate context. With energy security, but importantly, also with affordability. So without investment in replacement mines, South Africa's coal production capacity declines materially from the early 2030s. While domestic demand gradually declines, supply declines even faster. This creates a future supply gap, particularly in export markets, where additional volumes are acquired from the early 2030s. From 2032 onwards, we see that the additional volumes are required to meet export demand. And by 2045, only a small portion of export supply would still be coming from today's existing mines. Firstly, the global seaborne coal demand is declining, but we see supply is declining faster. Secondly, in South Africa, the pace of the energy transition is more gradual than initially anticipated. And when we look at Mpumalanga, the Mpumalanga coal fields become progressively harder and more expensive to mine as we see stripping ratios increase and yields deteriorate. So against this backdrop, resource quality and longevity matter more than ever. Luckily, Exxaro is uniquely positioned. We are uniquely positioned because we've got more than 9 billion tonnes of long-life resource. We are the only producer with an established production footprint in the Waterberg. I mean we know that Waterberg holds more than 50% of South Africa's remaining coal reserves. We have high-quality infrastructure. This infrastructure can support operations well beyond the tenure of our mining rights. We've got an established rail allocation. We've got access to domestic and export markets. We've got premium coal products. Over time, as supply tightens and other assets are constrained, Exxaro becomes increasingly strategic. In the next couple of slides, I'll explore with you these opportunities. Our Coal business has consistently delivered, delivered strong operational and financial performance, as you can see. This is a business with a proven track record of industry-leading safety with premium product quality, strong price realization and cost competitive operations. This strength show up in resilient EBITDA margins that are above 25%. I mean, our return on capital is above 20%. Our performance underpins our ability to definitely create shareholder value. Our performance is supported by a defensive base of long-term contracted volumes, giving the business stability and protection through the changing market conditions. So over time, the Coal business has demonstrated that it can operate well. We can generate quality earnings and convert our strengths into real value. The strategic position I've just described is underpinned -- thank you, I'm well taken care of. But for safety reasons, I'll sip and put down. The strategic position I've just described is underpinned by a high-quality Coal portfolio. Today, Exxaro operates 5 operating mines, with a combined life of more than 45 years, both in Mpumalanga and Limpopo. Our operations are supported by infrastructure that has been developed over decades and can sustain long life production profiles. The portfolio provides a strong defensive earnings base, supplying approximately 30% of South Africa's coal-fired electricity demand through long-term supply contracts. I already mentioned, ladies and gentlemen, that we produce premium quality export coal. And we have the capacity to supply the seaborne market for decades. Looking ahead, the logistics reforms that we're participating in, create opportunities to unlock additional value. While life extension opportunities provide further optionality across the portfolio. And at the core of this business, it's quite Grootegeluk Complex. If there is one asset that best represents the depth of Exxaro's Coal processing, it is Grootegeluk. Grootegeluk provides us with scale, longevity, a product range and strategic relevance. It has a resource base of 4.2 billion tonnes, world-class beneficiation infrastructure and a broad product range that spins power station coal, metallurgical and semi-soft coking coal. Also not forgetting the premium RB1 export coal that we get from Grootegeluk. We also supply mid and Medupi and Matimba Power Station, supporting more than 8 gigawatts of South Africa's base load generation from Grootegeluk. And beyond that, it has export linkage and meaningful upside as Rail reforms continue. As such, Grootegeluk is not just the largest asset in the portfolio. It is the defensive bedrock of the Coal business, an asset that anchors current value and helps define the longer-term future of Coal in Exxaro. But we also have Mpumalanga. Mpumalanga plays a completely different but equally important role, where Grootegeluk gives us scale and longevity, Mpumalanga gives us flexibility. It gives us the product mix and export leverage. The Mpumalanga region has a combined resource base of about [ ZAR 3 billion ], about 31 years of combined life. We've got 4 established mines, strong beneficiation infrastructure. We also have domestic and linked access to RBC [indiscernible] for our export market. It also brings strategic alternatives because it sits close to the industrial demand centers and gives us planting flexibility. It also provides regional processing and market advantages that support both domestic supply and export participation. Ladies and gentlemen, the portfolio works. It works because their regions play different but equally important roles. The Waterberg anchors the long-term story, while Mpumalanga has strengthened flexibility, near- to medium-term export leverage and is well positioned to supply and serve varied customers well into the future. So before I get into our performance -- our operational performance, I would like to spend a moment unpacking how value is created through our Coal business. So coal mining is often viewed as simply extracting tonnes from the ground. But in reality, value is generated across an integrated pit to market value chain, where each stage contributes to our ability to deliver sustainable returns and remain cost competitive. So as you can see, the process begins with our resource base, where the quality, the scale and the longevity of our reserves provide a foundation for long-term value creation and support the sustainability of our operation. We then move through the mining process where we drill, we blast, we load and haul, our coal. This is where operational excellence, equipment productivity and cost discipline become critical drivers of performance. The next day is then crushing and screening, the beneficiate and product handling. Here, we transformed the run of mine coal into marketable products that meet specific customer requirements. So all our mines have specific customer requirements that we need to achieve. Beneficiation plays an important role in maximizing value from our resource base. We also have a blending approach, which is another key capability for us. It allows us to optimize product specification, it allows us to improve resource utilization and ensure that we consistently adapt and meet customer quality requirements while maximizing realized value. Then once the product is ready for market, logistics becomes a critical component, whether in supplying domestic customers in supplying Eskom Power Station or our export market. Efficient Rail and Transport infrastructure becomes essential. The final stage is delivering to our customers. And here, product quality, reliability of supply and the proactive management of customer relations ultimately determine the value we realize in the market. The reason I wanted to include this slide is that it is important for us to remember that our performance is not determined by any single point in the process. Rather, it is the result of how effectively we manage and optimize the entire value chain from pit to the customer. Our mines are well positioned on the industry cost cap, particularly at Cotellic, where we've got scale quality and infrastructure, where we're creating a real advantage. Across Mpumalanga, we are focused on improving the margins through operational optimization through cost discipline and better product mix. But competitiveness as the operation is only part of the job. The bigger task is converting that strength into realized value. That is why logistics matter so much. The real value of a tonne is not decided only at the mine, it is decided, but what reaches the market at what cost and at what margin, protecting a leading cost position and unlocking expert value go hand in hand. One without the other is not enough. The future of Coal in Exxaro is not only built on current operations. It is also built on having a runway. So the extension of the life of our existing operations is important because it is one of the clearest ways to create additional value from assets and infrastructure we already have. Infrastructure, we already understand very well. So we are not going to simply add the years of mining to our assets. We go to make sure the assets are extended in the right sequence at the right capital intensity. That is especially meaningful in a market where future supply is tightening. So [ LifeX ] is about shaping the future quality of the coal portfolio and protecting Exxaro's commitment to keep participating in a changing market. One of the clearest signs of future value in Coal sits in the Waterberg. The resource base extends well beyond current Eskom coal supply agreements. That gives us a strategic horizon that is much longer than the current contract book. It creates room for future supply flexibility for future export participation and broader industrial optionality as South Africa works through the balance between energy security, affordability and decarbonization. For Exxaro, the message is simple. The future of coal is not bound by the current contract book. Waterberg gives us much longer strategic horizon. The improved Waterberg line will [indiscernible] Grootegeluk expert value. That is why we view logistics as a strategic lever, not just an external dependency we can simply wait on. We are actively participate in industry initiatives that will help improve rail performance while positioning ourselves for long-term structural reform. Better Rail performance, additional allocation alternative routes and broader reform all have a direct hearing on how much more value this business can unlock from the resource base that we already have. What we see on this slide is that Mpumalanga exports are directly linked to the improvement shown in TFR. This is however not true for the Waterberg region. As the line from Grootegeluk to Richards Bay Coal Terminal continues to be constrained. Instead, we've had to use multimodal channels to evacuate our coal through a combination of trucking and rail. This puts pressure on our margins. The export upside only matters if it remains profitable. After logistics, product mix, the exchange rate and the price are taken into account. So as the Rail reforms take shape, we can move coal on cheaper rail, and we will be able to reduce volumes channeled through multi-modal systems, which have proven to be more expensive than the directly. So you can agree with me how important the Waterberg line is to our portfolio. This slide, we show the diversification within our coal portfolio. The foundation of our earnings is highly defensive with about 2/3 of Coal revenue coming from utilities, supported by long-term take-or-pay and our cost structures. This part of the portfolio gives us stable, predictable earnings and limit direct exposure to short-term coal price swings. Beyond that defensive base, the remaining revenue comes from businesses that enhance value and give us more upside. Industrial customers that we have provided medium-term contracted revenue stream that is linked to South African industrial activity. We've seen the steel industry sales give us higher margin exposure through semi-soft coking coal and the metallurgical link pricing. And then export gives us access to seaborne pricing with additional upside as the logistics reform improves our ability to move more product efficiently. We have a balanced earnings pace within Coal. We are stable at the Coal, but with enough commercial flexibility to enhance value over time. Before I conclude, I would like to show you our capital profile to 2030. I as we have done this in our financial results in March. The increase you see in 2026 is mainly driven by truck and shovel replacement at Grootegeluk mine. That is does to sustain production levels to drive operational efficiency, to improve reliability, availability and sustainability and reduce the total cost of ownership. However, beyond 2027, sustaining capital normalizes while supporting strong free cash flow generation. To ensure a strong coal business. we need disciplined sustaining capital, well sequenced tied to assets that continue to carry value with a focus on protecting the reliability of our core assets, the continuity of our operations and the extensions of our Coal runway. Let me conclude Coal remains the foundation of Exxaro's earnings. We can generate cash. We've proven that and we can have sustainable returns. We have long-life resource exposure. We've got strategic support for South Africa's energy system, 30% and comes from Exxaro. We have a defensive, stable and predictable domestic earnings, strong free cash flow generation, and we still have potential upside when the logistics challenges that we're experiencing in the Waterberg become cleared up. The logistics, our value unlock level. Thank you.

Thank you so much, Caroline. We are right at 11:12, 12 minutes past 11. And now we're going to be transitioning into our questions and answers, that Ben -- both Ben and Caroline will take.

Caroline will take. That question from the center.

I will take.

So start here in the room. And please, if you have any questions, kindly raise your hand and the mic is going to be transferred to you. And before you ask your question, kindly introduce yourself. So move from the room, go to online, back to the room and go back to online. Thank you. Brian, I see your hand is up.

Thanks, Anda. It's Brian Morgan, RMB Morgan Stanley. Just a question, maybe a bigger picture question is, you presented a fairly bullish picture on long-term supply and demand in the global coal markets. And I suppose it makes sense that you're looking at life of mine extensions and you you're highlighting your resources outside of your reserves, that will make sense. But I would have thought in that sort of scenario or growth might make sense, be it organic or requisite to both might make sense. Could you just chat us a little bit about that strategy? Why we're not hearing about it? And if that might be something that you'd look at in the future.

Okay. So we'll take another one. Nkateko, please.

Nkateko Mathonsi, Investec Bank and is a follow-up from Brian's question and I agree with him that you printed such a bullish picture as far as the market is concerned. I cover the commodities, and they can't talk about 2050, but as far as Coal is concerned, we're talking, it will remain very relevant beyond 2050. So my question as well was around growth and why we're not hearing about growth. But adding on to what Brian has asked, I think we've also painted a picture of how instrumental Grootegeluk will be in that declining supply environment. So if you can talk a little bit more around the rail capacity from the order bag because that could easily become the constraint and what investment would need to go into that if supply starts to decline and you want to produce more out of Grootegeluk, how much volume can actually move within that line? And then also, I have a question on Leeuwpan, and your cost curve. I mean Leeuwpan is so high on the cost curve, what optionality do you have to actually shift it a bit into the left? If if even possible.

Okay and I can -- So let me start with the question on Coal growth. As you know, all our mines we've identified Coal within close proximity to our reserves for life optionality. So utilizing our existing infrastructure, all the mines, we're looking at opportunity to do that. But if you look in the Waterberg, we've got a whole reserve what we call Thabametsi. So the life-ex of Grootegeluk, we've always limited it to 17 years looking at the current mining right. But when you look at the total resource base, we've got unscheduled reserves within plus Thabametsi reserve, which takes us beyond the mining right beyond the contracted tonnes that we have with the power station. So giving us a life well beyond 46 years. So we are looking at growth in terms of life for each operation. And all the mines, we're seeing an increase because of life-ex. So with the life-ex operations, we're not targeting to mine the current base and then extend. Some there'll be an overlap with some of the life-ex projects that can be mined much earlier while we're mining the current reserves, and that will give us that additional volumes. Okay. And then I think -- let me talk about the rail capacity at GG. So our direct line from Waterberg to RBCT is constrained. It is constraint in terms of capacity. The capacity currently takes it to 3.9 million tonnes. So coal is not our problem. At GG, we've got plenty of coal that we can actually export way beyond the 3.9 million tonnes. But currently, from that line, we heady even get to 2 million tonnes. That's why the rail reforms and our participation with Transnet and other players, the Chrome -- the Chrome producers who can also use that line. That's why we're collaborating and in partnership to improve the performance of that line. So we also still have an opportunity for multimodal where should we need to export much more than the 3.9 million tonnes from Grootegeluk, we can use that optionality to do so. There's the last question on Leeuwpan. So you have seen Leeuwpan, its way out in terms of cost. We've just completed the Section 189 process. So that work has been concluded. We are busy with transitioning the mine to contractor mining model, that will give us a bit of flexibility. But we're also working on efficiencies. We're also working on our cost competitive net to be able to bring Leeuwpan closer to the Fed and in the future to even the second quarter. So we are working on Leeuwpan. I mean we've got -- we already have mines within our portfolio that are doing so well in terms of cost. So the lendings are internal.

So maybe just to add on what Caroline has just covered. On the growth, I think she covered it very clearly around Thabametsi is our growth in Grootegeluk. If it's only underground, it could possibly do a good [ 535 million tonnes ] on its own. If we get an IPP who wants to produce power there, then we can have an open pit mine. Otherwise, you do stay in an underground mine for export only. To unlock all that, as Caroline highlighted, the public sector participation with Transnet is critical. So doubling that 3.9 million tonne is much more accurate than me, I call it 4 million tonnes a year, doubling that depends on logistics. So our growth is really about logistics. And no doubt, as we see possibly the tubes entitlement is available. If Transnet continues to improve, we expect that the coal industry is not able to meet that entitlement. Then Exxaro will be more than able to fill some of the gaps that would exist. So I think you're absolutely correct, Brian, about the opportunity for growth is there. We need to unlock logistics and I think Nkateko, you've just touched on that. So that's really -- so our efforts are driving logistics, particularly from Lephalale to Mpumalanga. That is the bet because it's much more expensive on this multi-module system. And we think that, that growth will come from that area.

Are there any further questions in the room before we go? Yes, Brian?

Sorry, Ben, if I can just follow up on that. There's always the opportunity to allocate capital to acquisitions. I mean you're talking about from an organic perspective. But I feel that excited about the coal market in the long run, and surely acquisitions makes sense.

You have a target for us? I think these are the kind of conversations we would possibly have in our own engine rooms, but we definitely see a prospective an exciting coal industry in South Africa that we don't think our expansion plans are outside South Africa and those growth plans around what is possible I think if knowing that it can come with rail, it can come with export with port capacity. I think it's something that we know Exxaro will be interested in. I mean the -- this is a sector that is very cash generative. So we don't -- we want to be very clear with our capital discipline because Ryan is already looking at me that it's very important that it's cash generative, and we have promised our shareholders the money they must continue to benefit. And we're not going to compromise on that.

Okay. We have a question here with Nomanja, and then we're going to go to Andrew on the other side.

[indiscernible] from PSG Asset Management. I'd like to ask that question from a different angle. As you're speaking, Ben, it seems to me that with the Mpumalanga mine, obviously, you're the natural producer within that region. But the reason thereof is to be not able to double production is because of the logistic capacity constraints. And obviously, that rest on an exogenous factor that management can't control. So maybe ask the question from an organic expansion optionality because it feels like to me that's the obvious growth optionality that sits within the Exxaro. Is it possible for you guys to find alternative means of being able to, I guess, improve your ability to be able to take product out of Lephalale because Lephalale product is obviously much better on the cost curve. And then obviously, then you utilize the optionality that Ben was talking about, where if other people within the Mpumalanga regions, are able to actually meet their own allocation of as they mine lives actually come into ending that you actually are able to do that, because to me, what it feels like it obviously must be organic growth optionality first, given the asset that has the ability to actually give you that is actually also your Anga asset. So are you thinking about that alternative means because perhaps the return on invested capital that you can actually achieve by improving the flexibility of the Lephalale asset could actually pay design be a better optionality than actually buying another mine that obviously will be in the Mpumalanga region that you've highlighted the challenges that are structural that seem to be structural that exist within that region?

Thanks, [indiscernible]. I think there are two things. And Caroline touched on the intermodal system that we use in how we move coal from Lephalale to Mpumalanga before transit then picks up whatever we will not have managed to move through the railway line from Lephalale. So when she touched on that, it depends on things that, as you put it, outside management control like diesel prices. I think we have seen diesel prices this year go up by I think about 70%. So the impact of that on intermodal becomes more -- so they continuously monitor the margins you make out of that logistics, such that you know the intermodal still works or doesn't. And that gets monitored by Caroline and her team continuously in the commercial team. They also look at intermodal up to Maputo, is another route rather than Richards Bay and all that they monitor to see whether the price, the exchange rates and diesel costs still make the margins we want out of this business. So I think there are many options that they are looking at. If you think of organic growth, I think the future benefit of why the turnaround at Leeuwpan is not only to extract value out of Leeuwpan alone but it's a beautiful and Caroline coined it is a beautiful processing hub and also coal handling hub from all the core from Mpumalanga up from Lephalale can come in there and we can use it. And the uniqueness of GG that we have not highlighted is they produce that, call it about 30 CV. So any low energy call in Mpumalanga, which generally also gives us, I think, a lower sulfur, we are able to blend where GG might have high sulfite got high energy. So that blend is something no one else has because we are able to do that and actually sell a premium RB1 or RB2 when most can only sell RB3, which is much lower margin. So I think the organic opportunities to build up our processing plans right now, I don't think it -- what we will see happening is, I think we are seeing a trend, you would have seen in our pretty close that Transnet this year is at about [ 60 ]. So as that [ 60 goes to 66, 72 or 75 ], we think some peers who start faltering not able to meet their requirements. And only then we do then sometimes release capacity to address because if they release it at [ 60 ], they are released -- the problem is not the port. They will be releasing rally. And no one has got enough really because of that. So I think hopefully, we continue to monitor that. And maybe, Caroline, you might have more insights I might have left out.

No, I think you've covered it. We continue to look at opportunities, that's why when we had challenges, and we still have challenges with Transnet, we've actually looked at other opportunities to take our coal to Maputo and also the trucking optionality, but it's all dependent on the margins.

Thank you, Caroline. We'll take Andrew quickly, and then we move online. I've got a number of questions online.

It's just a quick one in terms of reconciling return on capital with your life-ex guidance that you gave on your Slide 23. I am surprised that from -- it looks like 2028, you stated you've got a life-ex program at Leeuwpan, given your comments earlier and given your comments about the focus on return on capital, maybe you could square that circle for me. And then also, if we just look at your CapEx guidance on Slide 28, it's quite noticeable that your guidance and what you actually achieved for the last few years, is quite a big divergence. And then we're seeing this big spend on truck and shovel. So it almost suggests of a lack of planning or some other reason? Maybe you could just explain why the big disconnect between guidance and what you delivered? And how much of that future guidance up to 2030 are you factoring in life-ex within that? What sort of lead time on that life-ex do we need to allow on the CapEx spend profile?

Thank you, Andrew. I think maybe Caroline can touch on the CapEx guidance because we also did see the results that indeed truck and replacement.

Okay. So what you're seeing in '26, '27, it's because of the truck and shovel replacement strategy. So the capital then normalizes. So we will remain within the guidance even with life-ex is included. So what you saw with Leeuwpan with the first block that we're going to include life-ex. That block is within -- is basically within where we're mining. We are going to have to mine around it. So acquiring it earlier helps us straighten up it. And then we actually just continue mining with that block in. So that's why we needed the block much sooner, otherwise, would have to mine around and then come back to mine it. So it makes -- when it makes business sense we will invest and bring the timing to where it needs to be. So our capital will normalize and we will remain within guidance when we look at the others as well.

Indeed, so I think maybe I could add that if you just look at our spend for 2022 to 2025, you will see that, yes, there is a bit of a hockey stick was actually, we underspend consistently for those 4 years, and that is the lump that we have got in the 2 years in 2026 and '27. So accepting that, that underpinned is actually just simply moved the hockey stick to the 2026, '27 period. so the shovel truck approval then came in 2025 last year. So if I was picking some of the big achievements we did last year is making sure that those trucks and shovels come in on time. So I'm very pleased that we have that bench, but it's actually critical to create the assets we need to deliver. But on average, if you then look at the total number, we're still hovering around the guidance that we have given. And also 2028, 2030, you'll actually see that we are slightly under spending than our previous guidance. So on average, we are equal. So I think Riaan can always cover that a little bit later. You spoke a bit about return on capital. And I think that's an important aspect. So I'm really glad you raised that on Slide 23, because what we are doing with this life extension is we are not putting capital in new plant capacity, equipment and plants. So if you think of Belfast which is producing at about 3.5 million tonnes -- million tonnes a year. The processing plant is -- was designed, I think, at about 3 million tonnes, and we are maximizing now at 3.5 million tonne. We will maintain that 3.5 million tonnes without spending more capital. What we are seeing with our neighbors is there a contiguous call deposits that provide us with life extension opportunity. There is no incentive for them to put a new plant. So it's much easier for them to do because it's better for us and it's more cost effective for them to sell those deposits to us in the farm boundaries so that we can extract using our infrastructure. So it's not new capital. It's simply spend on farm acquisitions to bring in production that extends the life of our mines. And it's not key today to be thinking of upgrading Belfast from 3.5 million tonnes to 4 million tonnes, but there's no logistics. If there was, there may be, but I think at this juncture and given the life of Belfast, we possibly don't we think you sweat that asset and infrastructure better by making sure the plant lasts as long as you need it to, and then you watch it from then. But I have no doubt that deep pocketed man will come in later and share some more insights.

Thanks, Ben. I think going online, there's a question from Philip Patel, [indiscernible]. And this question is with coal usage holding a larger-than-forecasted share of the energy mix heading towards 2030, what does this mean for the workforce stability, skills retention and entry-level employment opportunities within the Coal division? That's the first one. And then the second one is from Thobela Bixa at Nedbank. And his question is, what does the light shaded Copper and zinc mean in Slide 9? That's what Ben -- does this mean zinc is back? Previously, Exxaro wanted to sell zinc their zinc exposure.

I'll start with that and give to the boss on [indiscernible] Thobela, you would know that we are invested in zinc and lead in -- through Black Mountain. And I did not want to still reach a standard by declaring what the plan is. But that gray shade is saying, it is noncore. It remains noncore. If there's a buyer at a price, there's always the right price for a seller and a buyer. It's noncore to Exxaro. And we think that our attention is better placed in the assets we have chosen. So Black Mountain is noncore. That's why it's great. And [indiscernible], we don't expect to require to spend too much money. We're looking for an advanced exploration project which we can take up the value. But the [indiscernible] this is Richards, and I'm now -- he get paid for that part, so he must deliver in this case. Thank you. Thanks, Thobela. I think Caroline can touch on the labor and the prospects for our region.

Maybe, Caroline, before you go there, there's another question along the same lines, and it says, hi Caroline. Caroline makes an important point from that slide that supply is contractually faster than demand. The gap widens from 2032 and by 2045, only 6% of South Africa's export supply comes from today's existing capacity. At what point in the supply tightening curve measured by mine closure announcements, seaborne supply volumes or API for price, et cetera, would you expect the market to rerate Exxaro's coal assets from ESG impaired to strategic energy security asset. And is there anything Exxaro can do to accelerate that rerating or is it entirely dependent on events outside your control?

Caroline, take whatever you want. I'll take the rest.

Okay. So let me start with the easier one of the energy mix and what that means for Exxaro. So we are in a very unique position as Exxaro. We are unique in a sense of our long-term contracts that we have with the power utility. So when we look at the plans where there is depletion of mines and yes, there is power stations that will be decommissioned. The Exxaro power stations that we supply coal to. They are actually the ones that goes much further. So we're seeing the first one will be matter that comes to depletion is well beyond 2040. And then we'll see Medupi and Matimba. But the capacity that's shown as the base of South African coal in that capacity until the very end, that is Exxaro. So our people, our skills, our portfolio, we remain intact because precisely of that advantage that we have that other companies don't have. So that 2071, we had at Exxaro.

Thank you, Caroline. Perfect. I am just also...

I'll do the next one.

Yes, you can do the next one and then quickly, then we're going to -- we're going to -- I think maybe let me just say there's maybe one or two questions that are not answered yet. -- because of time, we'll address them at the end of the and to manage our time because Johan is also are ready to come in on the Metal section. So Caroline, you can quickly adjust.

Please read that question again.

Rebating.

It says, I'll actually just -- at what point in the supply tightening curve measured by mine closure announcement, would you expect the market to generate Exxaro from ESG impaired strategic energy security? And is there anything that Exxaro can do to accelerate that rerating?

So we've got an opportunity that we've got strong resources. So our 9 billion tonnes secures us well into the future. So as the mines deplete as resources get constrained in other areas, as markets change, we've got long-term contracts. So that benefit actually says with Exxaro, we are comfortable that we'll still be participating in both domestic and exports into the future.

Maybe let me just add that in the re-rating, it's a day like today that we are hoping our investors see how attractive our core businesses. So our job is to do exactly that. And hopefully, our investors vote with their money. So we have a distinguished asset base, long life. And in South Africa, Medupi and Matimba are the lowest cost power producers in the country. We will be the last ones to be taxed in any journey, but we remain very responsible in our stewardship in driving and accelerating carbon neutrality by 2050 and no [indiscernible] touch on that later. But it's really about are we attractive enough to the competition. And I think that's the foot we -- Carolina has been putting this morning.

Thank you, Ben, and thank you for all the questions. We will now allow you to go and Johan with Metals [indiscernible] tell this for you. Thank you.

My name is Johan. And I'm actually wearing green, not because of [indiscernible] or the spring box. We also have green for 20 years in Exxaro and who knows what the next 20 years will look like. However, we're unpacking the Exxaro's Metals portfolio with a particular focus of our new Manganese business. Manganese is in the house. And I'm glad to know that I'm also being called boss. The portfolio is comprised of our high-quality, long-life assets that generate cash today while creating future growth opportunities for Exxaro. I will discuss the market outlook, our asset base and operational performance. And the priority is that we will drive to create value for all our stakeholders, not only now but also into the future. Our metals portfolio consists of the new Manganese assets investments in Sishen Iron ore since 2006 and selected noncore interest like we discussed just now, just set as Black Mountain interest, but it still needs to be managed today as part of our Metals portfolio. The portfolio combines long-life resource and reserve strong cash generation with these commodities. Now I think that emphasis on long term, whether it's iron ore or manganese needs to be acknowledged. Both manganese and iron ore are both important ingredients for steel and daily fuel making. Being an ex steelmaking and sale steel manufacturer in my life, I do understand the importance of both iron ore and manganese. These businesses will continue to provide attractive dividend flows for Exxaro's metals portfolio going forward. This slide is telling a story. South Africa is the dominant global manganese jurisdiction, holding out 80% of global resources and contributing only 42% at this point in time to [indiscernible] production. This resource endowment provides strategic advantage going forward for us in South Africa, but very importantly for us is Exxaro. GP was production of approximately 3.5 million tonnes per year. It's one of the largest global producers and well positioned to benefit from the long-term manganese demand and growth. As said, manganese remains primarily a steel making commodity with 97% currently being utilized in the steel and stainless steel manufacturing production. Batteries, which is widely spoken about, represents an emerging source of future demand, and we acknowledge that. The GP manganese ore is predominantly used in the production of silicon manganese which used and widely used in the construction industry. So it's foundational to the steel and stainless steel industry, which has a long-term horizon. Steal is expected to remind the dominant end use market for manganese through 2050 as depicted on the slide. Although the mix of steel products is evolving, manganese remains an essential allowing element. And with limited replacement and recycling capability. In parallel, as discussed, batteries and other emerging applications are expected to contribute on the incremental demand and growth. And obviously, we will watch technologies as they evolve going forward. This supports a constructive long-term demand outlook for commodities and reinforce the strategic value of these high-quality manganese assets, including our iron ore assets as well. On this slide, China is currently the largest consumer of manganese products and dominates the alloy production. However, we need to recognize at the same time, India is emerging as the growth market supported by rapid industrialization and increasing steel production. We do monitor that also from a coal perspective also fitting that market. This geographic diversification and broadening the demand base supports a constructive long-term outlook for the manganese and creates opportunities for producers like GP to access multiple growth markets. We now move a little bit closer to -- did we buy, as you would be aware, Exxaro is invested in a world-class manganese position through [indiscernible] and related assets in the manganese field. Similar to what Caroline has discussed on Grootegeluk, GP is a long-life operation with substantial resource and reserves, producing [ 3.5 million tonnes ] annually, as mentioned. Our shareholding in Jupiter Mines is 19.9% and our own marketing capabilities that we have obviously onboarded now as Exxaro Manganese marketing and trading with 100% ownership. Situated in Singapore, EMMT strengthens our strategic position, enhances our ability to capture value and influence across the manganese value chain. Collective these world-class manganese assets position Exxaro as the world's fourth largest manganese producer as we have it today. The chipping mine value chain is typically to park open cast mining similar to our coal operations. People are at the heart of our business. And it's actually great to see that it complements the coal and the manganese that we're going to mine into the future. Always being mined in accordance with life of mine plan before being crushed and screened to size. Quality manganese ore is then loaded by our chip rapid loader [indiscernible] designed for 5 million tonnes per annum, all via our transport ports, and I'll elaborate on those optionalities a little bit later on. The manganese ore product is further shipped to customers and predominantly sold in a cost insurance and freight or CIF terms, which is slightly different to what we have been doing in coal, but we acknowledge our journey there. As a result, value creation extends beyond the mine with operational performance, logistics optimization and marketing capabilities, all representing an important value drivers and the profitability of our manganese business. Our focus at GP is centered about 4 priorities. And we want to take this at the right place because we also have to learn a lot from what we just acquired. Firstly, integration and disciplined resource and reserve management and life of mine planning, that we won together. Second, governance structures that ensures continuity and effective oversight. Third, logistics partnerships to improve product flow and reduce cost. And lastly, margin optimization through operational efficiency improvements and disciplined cost management. So we have a clear plan in the short term to make sure that we learn from these assets as we build the future. On the next slide, the governance framework that [indiscernible] provides institutional continuity, strong share alignment and balanced representation. Strategic and material decisions require shareholder approval, supported by clearly defined governance and escalated processes to manage potential dead locks, which we hope we don't have because we want to work together. To ensure board continuity, at Board level, Mr. [indiscernible], the former Chair of GP has been appointed as Exxaro's nominated Chair for a year to enable that business continuity to work together as we unfold the journey going forward. This governance structure supports effective and disciplined decision-making, operational stability and long-term value creation for all stakeholders. And I do apologize not representing you tomorrow on site visits because we have a Board meeting to [indiscernible]. So if you don't see me tomorrow, we have to attend Board meetings because we have governance that we need to do on GP. GP has consistently delivered strong operational performance. Safety performance has improved significantly. Production and sales have remained in line with mine plan and operation has maintained competitive position. cost position over time. It was mentioned before by our CEO, safety and production. If those are and quality, I think it's a good asset that we can see that we are delivering the results early on participating on this journey. Despite periods of commodity price volatility, GP has continued to generate healthy margins, demonstrating the resilience and quality of the asset through the different market cycles of manganese. This slide must give you comfort regarding our logistics optionality for GP and the manganese field. Logistics resents one of the most significant potential opportunities for us to unlock additional value within the manganese business. Like in coal and the manganese, we have to move the tonnes with our partners. While it's a significant portion of our product continues to be transported by road, Rail offers a meaningful cost advantage through the Meka or the manganese export capacity location framework. By increasing reallocation and improving logistics efficiency, through transient partnerships, which was mentioned before by Caroline, this partnership, we can reduce costs, expand margin and strengthen the competitiveness of our manganese business. So rail and logistics and marketing are essential to unlocking the value for the manganese business. In conclusion, Exxaro is established a high-quality now differentiated and global significant manganese platform with a clear path for long-term value creation. The portfolio combines high-quality long-life assets, a resilient cost position through strong marketing capabilities and future growth opportunities. Disciplined excusion and logistic optimization remind the key value lever that we need to unlock for the business and build optionality in future-facing metals ultimately creating sustainable value for shareholders over the long term. I thank you.

Thank you Johan. Thank you so much, John. All right. Ladies and gentlemen, we've come to -- we are a bit ahead on time now. So Johan has actually bought us some time. So 11:44. So just 6 minutes ahead of our comfort break. And I do recommend that we do take that comfort break. And then we will be back here in 15 minutes roughly. So around 10 past 12. Thank you, and then we'll have the opportunity to ask -- Johan is going to come up on stage with Leon after Leon does the synergy section. Thank you so much. We come back at 10 past 12. [Break]

All right. I know everybody online ready. Good stuff and I'm muted as well -- all right. Good afternoon, ladies and gentlemen, and welcome to the Renewable Energy element of our Capital Markets Day. It's really good to have all of you here. I didn't expect such a big crowd, good stuff. So I will start by reflecting on the progress that we've made, and then I'll share our view of the market that we find ourselves in, explain how we are going to address that. and close off as to how we're executing today to build a stronger Energy business for the future. So if you look at Renewables, as Caroline has said, Renewables are becoming increasingly relevant in South Africa's energy mix. And this consistent with the global energy trends. But there's also a need for resilience and a low-carbon systems as well. So on -- what we are looking at when solar and battery storage remains core to what we are busy with. The balance of the future, though, is mixed, and that require technologies that support both affordability and reliability. And that includes coal, just to be very clear about that. There is a [indiscernible] in this world. The growth that we are seeing is driven by 3 practical things, and one of that is cost. So it's not just sexy, it's energy security and its decarbonization. Currently, the immediate grit that we are facing is -- or a problem that we are facing is grid capacity. So firstly, the grid needs to be expanded. Currently, we're starting to see constraints in the grid. As you see more renewables, penetrating the grid, you'll have to invest in different technologies to stabilize the grid. And that's where you will see the advent of gas and battery storage more and more in our business. Now if we -- as we move towards a more liberalized market, we're seeing that regulatory reform is opening the market and is an enabler for the broader ecosystem. And you'll see more of us independent power producers there, private offtakers and Energy Solutions, which are different to what we've seen in the past. We are seeing a lot of activity in the public sector as well as increasing public offtake. You'll see that in our storyline also coming to a head. There's growing energy or interest in battery storage, especially on the Eskom side. We see that in the private sector. And I think that's a good thing because it balances the opportunities for clients. Now if you look at scale in South Africa, the Renewable Energy pipeline is very large. You look at the NASA registration, there is some 220 gigawatts of projects registered. So that's fairly significant. So from an outtake perspective, that's wonderful. What we do need to solve though, is the grid. And there are plans underway. There is an ITP program, which is underway, preferred but as have been awarded. And it's also important to note that private sector is playing its part. The execution risk and timing are not certain. So we are working, everybody working hard at this, and we're monitoring this space very closely. So with us, so talking to the market now, let's talk about what our plans are, what's our strategy? So what we are building with synergy is more than a collection of projects. we're building a scaled energy solutions business. Where we are active. We are active in the public sector, such a reap, reap is good. And then private sector as well, and that's where we include Exxaro, and we'll talk a bit about Exxaro's role in our life. It's important, but it's not the only role. Alongside that, I'll talk later in terms of our asset rollout, we are building an asset management company and also ops and maintenance capability, which strengthens our long-term value proposition. What's really important for us, it's not just about megawatts. And you'll see that with a lot of our competitors, there's a lot of chase in terms of getting megawatts -- for us, it's solving problems for customers. Getting back to our strategy, lower cost, lower emissions, security of supply. That's what we're striving for. From a tech perspective, Wind and solar is first and foremost, our focus. We see battery storage is becoming increasingly cheaper. And you see that with the Eskom grid windows as well, and that certainly bodes well for the off-taker. What makes -- what we believe makes us a bit different in terms of our growth approach is that we've got both a buy and a build strategy. A lot of our competitors do not have that. So we are developing our own pipeline organically. That makes sense for us. But M&A, we also do and where the risk and reward makes financial and strategic sense, we certainly do that. So paging on to saying is now we've talked strategy, now we're saying is, okay, so what have you done? So I'm very happy this picture gives me immense proud. It's up there with [indiscernible] and the box winning. This slide shows you, and on the next slide, we'll do that furthermore, is to show that our growth is deliberate and disciplined. And you'll hear the D-word a lot, discipline. We're not only focusing on adding capacity, but we are focusing on building a high-quality, high-margin portfolio. I'll share a bit about the margins later. Portfolio quality is central to the investment case. Long-term PPAs provide this. It's predictable earnings, and we have very nice EBITDA margin, 75% to 80%, that's not something to be scoffed at. At the same time, Synergy is becoming increasingly material to Exxaro's earnings with a clear trajectory with our current projects that are in construction, and under consideration of north of ZAR 3 billion by 2030. So it's not small change. So diversification is another important strength. We're not reliant on a single customer or segment. The portfolio is balanced and it's balanced in mining, utility and private sector customers. The growth is also aligned with Exxaro's broader objectives, and one of those very key ones is decarbonization. So strengthening energy security and long-term cost competitiveness is quite important, and that is what we can provide to our offtakers, including Exxaro. Overall, the business is scaling with discipline, anchored in strong fundamentals and positioned for sustained value accretive growth. So let's look at our track record and enough about the concepts. Let's see what we practically put down. So the first one, which we're very proud of is LSP. It's an important milestone for us. It's Exxaro's first Scope 2 decarbonization project, delivering the group's first green electrons and describing our ability then to execute. Secondly, you'll see the next one, you just see KB, that's [indiscernible]. It's a 140-megawatt wind project, which is under construction. COD is planned for early next year. And there's a 20-year PPA with Northam, and that talks to the private customer segment that we are targeting. Then we have [indiscernible] We are in the process of acquiring that from [indiscernible], a majority stake. What we did in line with our strategy as well is we increased our stake in O&M capacity there, and we bought the majority stake in the O&M company. And that the allowance to both generating capacity and also the services business that we want to expand. [indiscernible], the last asset there is a bid Windows 7 project. It's in the public space, and it includes our exposure and also with to government Remember, all government deals are backed by National Treasury. So from a credit perspective, that's quite a good thing to have. Our partner there is an international partner that is well renowned. So that certainly helps us in terms of gaining those learnings. So if you see as our customer base is evolving, we are anchored in the public sector with utility opportunities but we are increasingly expanding our private sector clients, and this includes Exxaro as well. This improves the resilience and additional growth avenues for us. The key message here is we are converting pipeline into high-quality earnings generating assets while strengthening the business behind these assets. Right, now we're done with looking over the show. Now let's see you where we think the growth will come from because everybody says everybody has these lofty targets, so do we. So this slide brings together how we intend the synergy business to 2030, but in a highly disciplined way. So our growth ambitions are clear. But every megawatt and [indiscernible] is here, he keeps me very honest, strict investment criteria, nothing for [indiscernible]. So we're not chasing growth for its own sake. We're focusing on opportunities that meet the return thresholds and that meet our strategic priorities. Central to this, and you'll see that in the middle block is Exxaro decarbonization aspirations for Scope 2. So these projects are strategically important to the group, both in terms of emissions, but as with [indiscernible] instructions, also long-term cost competitiveness. So the investment in Scope 2 project is not just an ESG project, it does help in terms of saving costs. Now just to give you a sense of what it's going to cost, this is reflected in our capital allocation with approximately ZAR 2 billion of equity earmarked for -- from Exxaro's commitments. And in the broader growth pipeline, there's a ZAR 3 billion per annum allocated for our growth pipeline. At the same time, so here is the centerpiece to saying is we're applying to Exxaro through various means. But it does not mean if you look at the blue block, are we stepping away from the market? And the answer is no. We continue to pursue attractive external opportunities across private and public sectors to maintain our growth momentum, diversify earnings and capture value in this market that is rapidly evolving. So the balance is clear. We will prioritize strategic internal demand from Exxaro and in the wider market, where returns and risk are compelling to us. And then I'll repeat that you heard again. What underpins this is disciplined execution, deploying capital very carefully, that translates into sustainable high growth earnings over time. Okay. So let's talk pipeline. It's good to have these projects. But usually what you need to do is a pipeline and to see how our pipeline stacks up. Let me take you through the pipeline. So the slide highlights both the depth and quality of our pipeline and how it supports sustained growth beyond 2030. So this is a longtime game. The pipeline is diversified across development stages from early stage, far left, 2 projects that are closer to construction. The balance is important because it supports a consistent flow of projects into execution over time. So Renewable Energy development, not as long as mining, but it takes it time depending on when in the journey you are and how close to financial close you need to be, anything from 12 months to 60 months. So a deep pipeline, therefore, gives us visibility and resilience in our growth. From a technology perspective, you'll see that it's well balanced between PV and wind. And if you look at where we find ourselves, I think the wind portion in our portfolio is particularly pleasing. And this also allows us to look at site conditions where the grid is not constrained. We've taken a proactive view on that, and we've deliberately located those opportunities in areas where the grid is available. And this helps with execution risk. We can go to the next slide. One of the things I think closing argument and this is saying is what we see happening in this market is that there will be consolidation as well. So you'll recall that I said that there will be M&A opportunities. And we believe we are well positioned. We've done that twice now before when we bought out the minority stake from Tata and now buying out the majority stake from AXIona as well. So we we're cutting out in this space as well. So let's talk at how do you unlock value. So we talked about strategy. Now we talked about how we're going to grow, where are we going to get this. Now the question is where you're going to make the money. So if you look at it, this slide is really about how we unlock value across the full life cycle of our projects and not just at the point of generation. So part and parcel of this is we're a long-term investor. So a key differentiator that is that we are not just an asset owner. We play across the value chain from development on the far left side through to portfolio operations and portfolio optimization should that become necessary. At the front, you need to get it right, we create value for -- through disciplined project development. And this is where early-stage expertise and execution in a disciplined manner is quite important. Now as these projects move into operations, the value becomes more stable and recurring and they are long-term cash flows, and we support them with O&M and asset management capability. There are also things we do to unlock value over time. Some of that is refinancing. You'll see that the bankers are getting better terms to us, farm downs should that -- should the need be there for capital recycling and selective divestments. There's also other sources of revenue, including services offering. And because we are a long-term shareholder, we can extend the life of these assets well beyond the PPA horizon. What ties this together discipline again. We are deliberate in how and when we realize value, ensuring that we are aligned with portfolio return targets, copies rather than being transactional and just chasing gigawatts. So the outcome of all of this, oftentimes, so we don't measure ourselves in ROCE, we measure it in equity IRR EBITDA, and you'll see the sum of the parts being a long-term shareholder playing across the value chain. That is how we get to the margins, and that's how we ensure that we get to returns that we promised. So the message is that synergy is extracting value at every stage, bring the business that is growing both in scale, quality also very key in this process. Right. This one also is way up there. It's not with Russi, it's with the blue bills. It's -- so let's look at the cash flows here. So the slide is about how the portfolio transitions into strong cash flow generation platform over time. And what did -- and why it matters for sustainable growth and shareholder returns. So first, the Renewable assets, so by nature, long-term investments. So in the early years, cash flow is largely dedicated to servicing debt. Once the debt is repaid, the profile changes and that you can see here. So post 2030, we see that there is a clear shift in the cash flow profile. That is when our bid window 2 assets, which we've long term invested in, [indiscernible], they now fully degeared, unlocking significant cash flows at a portfolio level. So this creates an important inflection point for our business. Firstly, it provides the opportunity for us to self-fund equity contributions into new projects. So we have then less reliance on external capital, and we can support the growth efficiently. Secondly, another de word, but you love this one. It underpins more divis. So certainly, we can pay more divis once there is free cash flow. So that's an important perspective. And then the last one is in this business, we don't have a lot of stay in business capital. So effectively, what happens is the EBITDA translate directly into free cash flow, whether you service debt or you return it to capital and to shareholders. So the key takeaway here is that our journey requires patients, not a short-term game, disciplined capital deployment. And this results eventually, if you're patient in the business that delivers a lot of cash and increasingly allows its ability to grow itself. So if we look at the unpacking of the -- so it's synergy by the numbers in this space. So I'll talk you through the detail at the very back of the slides, I think it's Slide 92. There's also more detail about the portfolio in terms of cost, megawatts, gearing, et cetera. So to understand the quality of the business, it's useful to look at what's under the hood of the current operating assets. And we use [indiscernible], it's in the public domain. So let's get a sense of what's happened there. So in 2025, we generated 703 gigawatt hours of electricity, with 98% of availability, 98% is high for wind. And that translated into ZAR 1.4 billion of revenue. And the 79%, I'll speak like Ben, I'll talk about 8% margin. So I'd like to round up a bit. So that's stable, high margin profile. And we're looking to replicate this on scale. So the first value driver is appropriate and predictable cost structure. Costs are usually determined at financial close. And in our case, with our current 2 assets, it's approximately 20% of revenue. That gives you visibility of returns. The second value driver is debt amortization. So project finance cost is significant. So you've got to manage this. So in the early years, as debt is repaid over the PPA cash flows were previously servicing debt. And now it gets to the bottom line where you actually start distributing that to shareholder. The third one is the cash cover which I spoke about. So that EBITDA effectively translates is not a big working capital element or same business. So that's very good. So in this case, more than ZAR 1 billion of EBITDA translated into cash from operations, which is quite a hefty sum of money. EBITDA, I've spoken about, converts very well into free cash flow over time. So this is fully aligned with the Capital Markets Day theme of accelerating disciplined strategy execution, high-quality business, in our case, very defensive, but predictable and meaningful growth. So in all of these businesses, you've got to do risk management. We live in a world which is top [indiscernible] to say the least. So here, we highlight that risk management is embedded in how we structure. They've got a fancy word in our word, they call it risk allocation where it is best suited. So make of that what you want. So it's how we structure our business, and it's central to protecting our value across the portfolio. So on revenue, the biggest contributor, currently, the assets in our portfolio is 100% take or pay and the [ 10 years ] range anything from 8 years. Those are the rep assets to 25 years. Those are the newer assets. So this provides a high degree of revenue certainty with inflation-linked PPAs that offer a natural hedge against the cost escalation as well. So from an offtaker perspective, the portfolio is supported by strong counterparties, investment-grade private customers and also the public sector, which is backed by National Treasury. And then on the cost side, downside protection in construction is supported by contracting and hedging strategies, in particular, for interest and FX, and that makes an important component for us to observe to manage the risk. Our contracting strategy also plays an important part. So maintenance are in place for the key components of the commercial life of the assets, whilst CPC structured transfer appropriate construction risk and delivery risk to contract this. So on the rear [indiscernible] risk, and we've done this with both the acquisitions before [indiscernible]. We have a look at the resource. It's not uncommon like in mining companies, and we do extensive studies before we make the investment decision. That reduces variability and improves your confidence in the long-term asset. So our debt funding structures are designed to enhance returns and manage downside with typically high gearing in this game because it's predictable. You can get it high. You'll see it in the backup slide as well. and there's limited recourse financing. So effectively, what this means is that we don't have to look at the mothership to bail us out. So lender participation is also an additional layer of rigorous due diligence going through lenders legal and then this technical is not easy. So that's good for us. So, the overall message is, yes, we're growing, but it's not only built for growth. We're really looking at derisking our portfolio. So it's structured for resilience. There's multiple layers of protection, across revenue, cost, contracts, resources and funding. So I conclude, very proudly so. We've shown you an Energy business has moved from strategic intent. So from 2021, we had a nice story. It moved now into a stable cash-generative reality. We are operating a high-performing portfolio that supports Exxaro's decarbonization strategy, while we are delivering earnings value growth. The strength of the portfolio lies in its defensive positioning, long-term PPAs with utilities and private off-takers reduce exposure. We don't have commodity price volatility, and it provides predictability in terms of earnings. So we're delivering a double mandate as well. So Exxaro's [indiscernible] strategy as well as contributing to South Africa's broad energy transition. So our pathway to 1,600 megawatts by 2030 is about scale, but it's also our disciplined execution and integration into the value chain. So ultimately, we're trying to build a very high-quality cash-generative business that supports Exxaro's valuation, what Ben alluded to now. And as the debt amortizes and the value unlock becomes increasingly meaningful creating opportunities for self-funded growth and sustainable shareholder returns. So in simple terms, we are not just adding megawatts. We're building a resilient yielding generating platform. Its execution is with discipline. We believe that this business will be one of the corner stones of Exxaro's diversified future. Thank you very much.

Thank you so much. We see Exxaro is harnessing Wind, harnessing solar, and we are mining the orebodies underneath the ground. So that brings us to our Q&A session right now covering Cennergi and Metals.

So we'll take questions in the room. I see Brian is the first 1 to raise his hand, all the time. So we're going to give you, Brian.

It's Brian Morgan again from RMB Morgan Stanley. Just Johan, if you can just [indiscernible] now that you've taken ownership of Cipy, chat us about the mine and the mine plan, if you can give us a bit of color on stripping ratios in the next 5 to 10 years, when do you need to go underground, what are you -- how should we be thinking about this and modeling this one medium term?

Are there any other questions in the room? I've got one.

My name is [indiscernible] from McCloskey Dolores, and I've got a 3-part question, and that's directed to your hand. First, the pending gala deal. Can you provide an update on the sale transaction? And what are the key hurdles there? And how much additional CapEx should you pencil in for this integration? And secondly, my question is on Rail and Infrastructure. On the Manganese, of Manganese from CPs transported on road. How does Exxaro plan to leverage the existing relationship with Transnet to optimize your exports there? And essentially, what is the MPC's current deal with logistics and expansion plans? And lastly, Johan, your presentation shows a demand for manganese in batteries. So as part of your sustainable growth plan, are you considering to pivot a portion of the manganese portfolio towards battery-grade manganese sulfate or any other downstream beneficiation? And maybe to throw in a bonus question. Given that Exxaro now owns a portion or nearly 20% of Jupiter. Of course, with a direct stake in TB. What is the long-term vision for this partnership? What are we seeing there? Are there any commercial synergies? You can unlock by aligning your marketing rights with this? What do we see with this relationship going forward? Four questions.

Thanks, Brian. I think one thing that we have taken over, it's a well-run business for 10 years by well-structured CEO management team knowing how to manage that mine. So stripping ratios, aside for now, so between 10% and 12%, which is bigger than what we know from a coal perspective, but that has been the plan. And this outlines a life of mine plan nearly to 2050 for an open cast mine. Thereafter, only we have long-term resources even to go underground mining. So that has been factored into the life of mine. It's a 25 years, including pipping ratios associated costs, including logistical costs long-term forecast on price, which we manage the cost and to manage accordingly. So very proud to see looking at the life of mine that we have a good 25 years ahead of us and all dependent on what the prices will do going forward. We do need to acknowledge that [ City ] is one of the large open cast mines for that type of longevity because most of the others potentially don't have that life of mine. Which gives us opportunity why others have to go underground that we can still operate at a good cash cost margin given that we're still on open cast mining. Hopefully, that gives you some color, but very confident that there's a good resource on reserves. Obviously, with our technical services and what we bring to the table, we will see how we can -- similar to [indiscernible] or to makaan that we bought over going to see how we're going to leverage and still create more value if we can. Yes. Then on the McCall transaction that has been announced, it's still in progress. And I think as part of our business development, I don't want to fuel the sun of Richert and [indiscernible] take to me before and don't pass all the questions to me. But I think the Mekala matter is clearly there. From an operations point of view, I do the integration on the sales as they come through, it's like playing the ball in the rate team. Once that is done is to hand it over to and we have a plan. So we have a plan for [indiscernible] in the eventuality that the deal had gone through. So from an operations point of view, we really do understand the asset. We do know how to manage that, similar to 1 by 1 or as we'll have a plan to indicate. But I think on the Mocal matter, Richard will deal with that in a little bit more color. On the raw basis road, if I think about iron ore sitting on the board of [indiscernible] on behalf of Exxaro, sitting on our newly manganese in the house, our coal I think we are quite a big substantial voice together with transit to build this country. It's not about trial as well. I just want to do that is clear manganese has a port issue as well. to actually efficiently load these volumes on port is rudimentary compared to coal. So there's a lot of opportunities that we have to work with Transnet to see whether we cannot unlock value through the logistics market. And then one step ahead, it's also what ship sizes we can utilize to actually utilize going forward because that has a price impact of [indiscernible] so there's a long-term partnership, including the MPC, how we built the PE export channel, but understanding export channels, we are nearly 1,000 kilometers on all the export challenge, have optionality, we just learned from Genco where one of the ports was impacted by a storm. Keep the optionalities, but you just don't bank on one port alone and make sure that you have export channels throughout. So that, I think GP has done very well to have quite substantial export channels. Demand on battery grades -- that's will come with time. We need to acknowledge we are a silicon manganese player. Battery minerals actually looking at 44% manganese qualities. But we have -- the value in use is not fully understood yet. And that's the part, I think the time that we brought in the Kumba [indiscernible] the value news for that $15 that Kumba got to the quality, maybe we can add that type of thinking towards the journey as well because battery manufacturers are predominantly looking at 44% rather than the 36%. So we are acknowledging that. But as this portfolio grows, who knows what that means for us. On the MS side, 99.9, work with what I have currently. We are joined by the 50-50 nearly per Jivi,and we're working together. And I must say there's a healthy realizations between myself and Brad and the Jamie's team, working together to give direction to the CEO, ice and his team. That's where I'm at this point in time. Creating the value that we already bought into. And [indiscernible] remind me, it's a lot of money. So we need to bring that to the money and pay back the money. Future optionalities will be determined as we unfold. And I think the similar analogy I want to give the schematic limited over time. It took 5 years -- there is some thinking around that. We are -- we have been on this journey before, and I think we need to try to get day by day for now, deliver the value of the money that we spend.

Thanks, Johan. And [indiscernible] it's got a question there. We can get a mic.

Nkateko Mathonsi, Investec Bank. My question is on the margins of the current renewable energy business, which is around 79%, 80% if you can talk to the new energy business that are coming through and what margins they come in at, including even the latest bid round. Over time, what is happening to those margins? That would be very helpful. You also talked about the potential for you to extend life beyond the CCA period. If you can just talk to what CapEx level that would actually happen at maybe relative to the CapEx that was invested initially.

Easy question as always. So on the margins, it's true. If you look at an alone, we measure equity IRR. So you said the downward pressure on that. When we started the [indiscernible] it was not uncommon to get to 20% on your 20-year PPA. Early days, nobody knew what was going to happen. So that risk was absorbed. Nowadays, it's probably in the range of 11% to 13%. That's what we see. So does the margin then reduce. So from a modeling perspective, I would say these numbers and back solve it. So the only way then for us as integrated players to make those margins is to play in that whole value chain. So you take that bit by bit. You include a refi, you include the development fee you participate in the O&M bit. And over time, you gain your margins there. You also do the refinancing. And you'll see the terms, if you look at the back end, we copies analysis of the debt is if you look at the -- what we paid for debt early on and what we paid for debt now is a lot different. And also the tenure of the debt is a lot longer. So I would give you that guidance to say is that's more or less what you need to think about in terms of the business. If you look at the -- I think the value between -- or post-PPA, these assets are designed to get to probably 30 years. I think you can possibly get 25 to 30 years from solar. May be slightly longer on wind. And there are different ways and means of achieving that. What we're seeing from the REIT towers from overseas where they're leading the charge some of them completely repower and they have less wind turbine set sites, and they just use higher generating units that create that. So that's almost a new boat. Then there are different ways. And if I -- I think that's where we are well set up from the Exxaro perspective is, essentially, especially on the wind side, it's mechanical equipment. And with our wrong history of coal, we managed the truck fleet, how we manage the shovel fleets. That is part of the DNA that we want to transfer to this business. So if you run it longer, you can either make it completely new, get high generating capacity or you can just run it longer. What you typically see is the solar does continue to degrade and you'll replace the panels, et cetera, over time. So that's a fairly new build on when it's less so. I think a lot of the structures will last. I think you can probably work at 40%. But it depends still, I think in SA Inc., we will probably get to that stage. Early 2030's where people will have to start making decisions. And that will also be determined by a because in a liberalized market, you will have to decide what capacities you are chasing and what availabilities are important to you. So it's a different market dynamic. But I think there are various optionalities and depending on what you're solving for those are there.

I want to go to Tim first and then Marcos and then -- okay, so we're going to go team and then Steve and then Marcos .

It's Tim Clark from SBG Securities. Just one question for each of you. On manganese, it's a contracted mine, right? So it's all contract in mind. And I would imagine that Jupiter doesn't want to recapitalize the mine. . I just wonder if you could speak to that contractor model and whether it's optimal for you or whether you would reconsider or look at I don't know because the real value that a poke about bringing to the mines with its ability to run open cast mines efficiently bring costs down, et cetera. So that's the first question. And maybe just on top of that, with the 46% tracking, some of it's partially trucked, I think. It's not tracked all the way to port. So it's to a rail siding. If you could give us a bit more detail for the modeling that will help us just a little bit more granularity on tracking versus -- because it's such a big portion of costs. And then, Dean, just on the renewables business. I suppose the concern that I've got for the business is that, yes, it does in cash flow positive early 2030s as you get to the last 4 years or 5 years of your contract of your PPA contract. But you've also outlined a wonderful growth profile and pipeline. And so it kind of doesn't look like you're going to generate cash for the center or for shareholders and for dividends for shareholders for quite a long time. I just want to make sure that, that understanding is fair because there's 2 things is the growth and then the cash flow and obviously -- or are you sort of committed to giving Rian some money or a certain level of money before you invest as a limiting factor to investing.

All right. And then I think we can take you, Steve.

It's Steve Friedman from UBS. My question really is probably directed a bit more towards Ben, but maybe Lean and Johan you highlighted an IRR target of 15%. I'm just curious to see how you're going to evaluate the various opportunities in manganese versus renewables, how you look at deploying that capital and that relative to returning the cash to shareholders just given the differences of those businesses?

I think maybe we can take those -- Okay.

[indiscernible] from F&B Wealth & Investment. My question is just to clarify the capital requirements for the Energy business. So you mentioned on Slide 49 that the tax requirements about $3 million per annum. I just want to clarify that, that's the gross low value. So that would include kind of the debt financing component or -- is that for the full equity value?

Thank you, Marcus. I think let's start with you, Johan. And then we'll come to Leon, and then Dan is going to touch on the question from Steve.

Thank you, Tim, for the question. I think a very valid question. But we need to acknowledge that the contractor mining was the plan that we brought into and CP has been at 10 years. And there is a contract established for that until middle of next year, which the Board and the management is currently considering how to do that like we do how fast or any other mine for that matter be revaluating and it's always backed against for owner mining type of methodology. But back to the -- we spent this type of money. We have to work what we have currently. And we're not intending to now immediately go out there and say, we want to buy our own trucks, et cetera, because we have this relationship already with the contractor mining. However, given that we have a life of mine of 25 years, we have to do the study. There have been done various studies that obviously has impact on costs after cash flow, which is the share of it matter, but if you contract with any mining contractor, you also have to repay new equipment. So if you look at the owner mining versus contract mining, I think it's definitely something that Exxaro's going to look into the medium term. But in the short term, we're going to manage the contract mining, but that's the right time. We'll see how that might -- but it has to make businesses at the right time. Hopefully, that makes -- in the timing-wise, where we are currently, I think we're just turning along with a JV partner and making sure that we do the right studies at the right time and bring it back to the CP Board for evaluation. On the optimal trucking versus rail. I think we need to make sure that we have a strategy long term to say, can we not put everything on the rail. If you look at the infrastructure that was developed at 25 million tonnes, which we are underutilizing less than 50% off, one should move that to roll but it has the same challenges like moving it to port and offloading at portent harbor hence the trucking is being utilized. So I think the analogy of 46% trucking for now is a broad reference for modeling purposes, but do appreciate that we're going to work with fans to see whether we can issue more on rail. Obviously, the urate example is going to be trucked. That comes at a car going through border control, et cetera, but that's an optionality -- so sometimes you will still have tracking because you want to have that optionality going forward. So over time, we will explore and give you guidance on what we're going to put on tail versus trucking. We do understand the impact on the business. Hopefully, that gives some color. On the IRR, et cetera, I'll leave that to the broader outcome.

And then we'll go to online, please to give the opportunity for those that are also interested in questions.

So Tim, your question is it unbridled growth? Or do we -- is there some discipline in the process. The principle in this company is simple Exxaro owns the cash. So Exxaro decides where it wants to distribute the cash. Currently, [indiscernible] is already through the group model. We are already paying dividends as part of the model, and we will continue to do this. So there's no unilateral declaration of independence, where we say, well, the our money, our cash. We're very aware that Exxaro has helped this business to be where it is in the future. So we will be guided by the growth there. I think the comfort that we're trying to give to the market is that we can pay a decent dividend and still growth. The tempo at that point in time will be determined by the circumstances of the company. What we will have then is a company of size, and a company of optionality. And having optionality certainly helps us to decide what is best for the company, but also fully recognizing that we are a full subsidiary of Exxaro.

Maybe I could just add that you'll possibly see in Ren's presentation later around how we look at the whole business, including what Steve mentioned earlier, that each business from what we can see, coal, vessels, metals, there's lot of renewable energy. We tend to have quite different multiples and returns. And therefore, the capital allocation needs to consider each of those business units with its competitors versus its own competitors. And these it's on competition for capital. We expect each commodity is coal and as metals alone and as renewable energy alone, to deliver value within its competitive environment so that the capital allocation is more justifiable because I think we do realize that the multiples are quite different. And then it's important that they are generative themselves, but they are on returns. So one of the graphs that Leon showed was critical in showing at what point can we swim alone. And that is quite critical in terms of how we look at capital allocation for each of the business units. Jonny can then go in late [indiscernible] question -- so the ZAR 3 billion is the equity portion. We typically you're looking at between 70 and if you're really aggressive, 85% gearing. So that ZAR 3 billion per annum is our equity portion, and that's been done with the capital allocation model with the needs of coal on an side with Joan's needs on manganese and other offerings. So we're balancing all of that -- so there's quite a detailed and detailed process that we go through in terms of the corporate model to ensure that we've got a robust still remaining cash flow and for shareholders. I mean we've got a new revised dividend policy of 1.5 to 2.5. So in that process, that's 1 of the key focus of that.

Thank you. And then going to online. So let me group the questions related to Manganese John. Just also just mindful of the time now that we are eating into our launch -- so please bear with us a little bit, just so that we can just conclude a bit of these questions. And so we've got a question from [indiscernible] Wealth. And this question is around -- is on manganese and he's asking, are you not concerned that the increased rail allocation for manganese would further oversupply the manganese market. given how large of African supply is versus the total global demand. And then while you take note of that, Johan, I also want to then give to Leon -- the question that is at what margin and returns is the pipeline expected to come at? This is from Tobel Pipa from Nedbank. Will the energy business continue to be managed off balance sheet? Is the question -- and I think yes, Ian's question as Ori was already answered, talking about the margins versus, I mean, Amakhala and the going -- from a continuity perspective, what margins are we expecting? I think that 1 was nicely covered. And then could you please elaborate on unlocking margins at TP, through logistics. How much improvement are you targeting? How much reduction in trucking can we expect -- what that you're expecting on a 10-megawatt basis for future renewable energy business. So that's where you, Leon. So I've got 2 questions. It says, can you please elaborate on unlocking mine logistics and how much improvement are you targeting? And then how much reduction in trucking can we expect? And then for you Leon, what is the CapEx you're targeting on a [indiscernible] basis for future renewable energy business?

Thank you, Alan. The first 2, just to complete the manganese journey. Obviously, as I said, unlocking the value for the manganese business includes marketing and logistics. So that comes a disciplined approach, hiring to feed the market at the right price, including the logistics that we have. but unlocking the long-term view of moving it by rail definitely improves our strategic and competitiveness against others in the world. So we cannot shy away from that we're competing in the world -- so we have to be more competitive and obviously, discipline to the market to ensure that we can create value. So for me and for Exxaro, I think unlocking it and creating more value through the rail allocation definitely is going to unlock value for the KSA but we need to make sure from a marketing point of view that we also have an approach how we're going to make sure that we maintain the value over the long term. But it's a long-term guide on that because you don't just switch the finger within tomato, we can move everything by rail because it's a long-term relationship that we need to build. On the improvement on logistics, it's 3 months, I think, give us time to understand it's a good question, a number needs to be case what's the improvement optionalities that we have at -- for now, business continue is top of mind that decisions are might and that we maintain the outcome that we want. But we do want to improve and that we will give guidance on whether it's on the Royal allocation business out versus cost on mine owner mining versus contract mining. All of these, we're going to look at to see what value we can bring. We have some plans in place. And that will be playing out together with our joint venture partners into the budgets that we need to jointly approve going forward. So we have not yet guided on what unlocking margin means and then quantified it. So it's not something we could comment on today. But we can see the opportunities and Johan is going to link around that what we are finding is we are finding exactly what we bought, and we are making good money out of it and the prices seem to be slightly smiling. I think we are getting what we bought and we are very excited that we can unlock value with the synergies and competencies we have. And I think Johan highlighted that. On the railing, maybe I could just add a comment that we are involved in the manganese producers consortium. Is that correct? and -- but any increase in railing is actually quite beneficial not just for our margins, but also for the community roads in that area. It will take away from road trucking to railing -- that should be more efficient. But if anything else, it should be safer for our roles. So we welcome any increase in railing capacity in ports that may be coming through in line with the consortium that we are part of sale.

Over to you. Okay. So let's look at will operating margins in future decrease? I think the answer is yes. These were bid window 2 projects out first 2. So it's suffice to say I don't think we'll get to 20% IRRs more or less that we got there. So you can expect the margins to decrease if you do a back solve in terms of your equity -- on the -- we continue this in terms of off balance sheet? The answer is yes. With no ways that this business can be competitive only on an equity basis. So you will always introduce gearing into the business. And the reason for that is because the income stream is predictable. The moment it is less predictable, you have less gearing in it. And your cost of debt is always lower than the cost of equity. Now on the cost, it's difficult to tell you what the CapEx per megawatt is. I think what you can see is if you just read the price I think possibly slightly north of ZAR 30 million per megawatt for wind and probably 15 to 18 for solar. So solar is lower. Your capacity usage on solar is less wind is higher, and it generates a lot more the installed megawatt than solar Hope that helps.

Thank you, ladies and gentlemen. I think now we've actually come to the launch time. And please, just in terms of orientating ourselves to the launch venue. So we get out straight and then by the coffee shop, we turn right, and that's where we're going to have our lunch. And we should be back at in 45 minutes, and we apologize to those that are watching us online. And so 45 minutes from now, we will be back again. So 2 up.So around 2:00. No, not around at 2:00. So we're back at -- so we'll be back at 2:00 our afternoon session. Thank you so much. [Lunch]

Good afternoon, everyone. I hope everyone had a good lunch. What did they say Johan, Mark his fall or he's to? So this is a strategically placed session. I am Richard Lilleike. I am the Executive Head of Strategy and Business Development at Exxaro. I have the unenviable task of presenting business development, where I need to balance the sharing of information with my corporate legal team only taking 1 inhaler per slide. So let's get going. In this session, I will be expanding on the strategic priorities discussed earlier with a focus on how business development is driving the execution of our growth strategy, supporting Exxaro's growth ambitions and portfolio evolution. Over the past 3 years, we have made significant process in delivering on our sustainable growth and impact strategy, reshaping the portfolio through disciplined capital allocation, strategic transactions and active portfolio management. As Johan highlighted earlier, we announced a transformational milestone in March this year. That was the completion of the Nonsan Bentley Holdings transaction, acquiring amongst others, a 50.1% strategic interest in the world-class TP Bowe mine. We entered the sector where transactions have been contemplated by many over the last decade, and I hesitate and none have concluded successfully. This transaction provides Exxaro with a meaningful position in a globally significant commodity, which is strategically important for both steel production and domestic steel while simultaneously establishing a platform from which Exxaro can build scale in a sector where size, quality assets and market position matter. Importantly, this transaction reflects the type of opportunities we are seeking, high-quality assets in attractive commodities where we can leverage our operational expertise and create long-term shareholder value. In 2025, we disposed of our ferro alloys business to a consortium consisting of a Level 1 BEE entity management and employees to deliver on our promise of closing a truly empowered deal. In 2024, alongside Anglo American, we completed the sale of a portion of the Maromba South mining lease to neighboring Stanmore resources for USD 75 million, unlocking value from a noncore asset that demonstrates our disciplined approach to portfolio optimization. This transaction is in addition to the ongoing sales process being managed by Anglo American for the Australian coal assets with an offer from Dilma from Mirambo South expected shortly. You may recall our involvement in the Comac copper process in 2023, where together with another South African strategic partner and a development finance institution we were able to demonstrate South Africa's competitiveness in the global auction process. While we submitted a final offer, we ultimately elected not to proceed once the transaction no longer met our risk adjusted return requirements following the final bids submitted by an international competitor. While we were not successful in that process, it demonstrated both our ability to compete for world-class assets and our willingness to walk away when value cannot be justified. We view the ability to walk away from transactions as an important element of disciplined capital allocation. Turning to Makala, I had a much longer speech, but I see it's been redacted. And let's see what's left. Makala, as you know, is a joint venture between Glencore and Bente and remain strategically attractive and remains a strategically attractive asset within the manganese sector. As previously disclosed, discussions remain ongoing with the relevant shareholders regarding the valuation of certain contractual arrangements associated with the transaction. Consistent with our disciplined investment approach, we remain committed to the valuation parameters committed to the market when the transaction was announced in May 2025. Exxaro maintains a clear and disciplined growth strategy with manganese and copper remaining our preferred commodities. While our manganese strategy is focused on building scale and market relevance our copper focus has evolved towards earlier stage opportunities, particularly in exploration where we believe attractive long-term value can be added. These 2 commodities align well with our expertise in bulk mining including both open pit and underground mining with relevant technical expertise in primary beneficiation. Within our vision of becoming a diversified natural resources champion, we have a clear aspiration of becoming a market leader in the manganese sector, but not at any cost and not within any time frame. This ambition will be pursued with the same capital discipline that underpins all of our investment decisions. In unpacking what it means to be a natural resources champion in Africa, we continue to consider a long-term vision of a commodity profile, which enables us to be globally significant while this longer-term ambition provides direction, it does not detract from our near and medium-term priorities, which remain focused on disciplined execution and value creation. We also remain open to strategic partnerships with our complementary to our investment aspirations. The mineral investment criteria approved by the Exxaro board remain largely unchanged from those presented at the previous Capital Markets Day in 2021. Reflecting the consistency of our strategic approach and investment discipline. A number of refinements have, however, been made. Most notably, we have updated our definitions of key earnings contributors, point number two which will require investments to generate returns greater than our cost of capital. Previously, this was set at 1.5x our weighted average cost of capital, which in hindsight was a conservative position. We have also retained our portfolio level requirement on achieving a return on capital employed in excess of 20% for the group. Within the life cycle criteria, point number 5, we have now expanded the framework to include exploration opportunities, primarily to support our copper strategy, recognizing that acquisitions of producing copper mines have become increasingly challenging, given elevated valuations that we are seeing right now. We have also refined our geographical focus. While our previous approach considered opportunities globally, we are now prioritizing South Africa and surrounding Southern African jurisdictions. We believe Exxaro has a competitive advantage being an African mining entity in this region and a clear, strong and differentiated competitive position in South Africa. Let me now turn to manganese. Following the completion of the Nisbet transaction, Exxaro has established itself as a meaningful manganese producer and marketer, requiring us to refine our manganese strategy to reflect our enhanced position in the sector. As Johan highlighted earlier, we continue to hold a strong and fundamentally positive outlook on the commodity. At the same time, we find ourselves not unsurprisingly, in a world of fragmented supply and coordinated demand. South Africa hosts the bulk of the world's manganese reserves but given the fragmented supply does not realize the full position, the full benefits of the strategic position. Therefore, success in manganese requires moving beyond the passive mining approach to becoming an active market shape with integrated capabilities across the value chain. This can only be achieved by creating scale to unlock this value. There's value to be created in the mining, logistics and value chains and freight value chains. This slide illustrates the market dynamics that continue to shape the manganese sector. Given the importance of logistics within the global supply chain disruptions can have a significant impact on market pricing. This can be seen during the COVID-19 period, the 2022, '23 Cabanis Rail impact and more recently, the tropical cyclone Megan in 2025, which destroyed port infrastructure affecting Australian supply. The key point to note is that after every peak, the manganese price experiences a sharp correction as a result of this fragmented supply base and flooding the market with lower grade product. In our view, scale is an important differentiator in this environment. Larger, lower cost producers are generally better positioned to manage through commodity cycles. Optimize production and marketing decisions and capture value across the broader supply chain. It is also important to maintain a long-term perspective. Over the period 2019 to 2025, manganese prices averaged approximately $4 to $4.8 per dmtu on a CIF basis. As Johann referenced earlier, the cost curve places CCIF costs at around $3 per DMTU. Demonstrating the asset's ability to remain profitable throughout the cycle. Consistent with the assumptions used at the time of the transaction announcement and still relevant today, Exxaro's long-term semicarbonate FOB price assumption remains $4.2 per DMTU, which is broadly aligned with current spot prices. So what does it take to become a market leader in manganese Scale is certainly part of the answer, but not at any cost. Our objective is to build a portfolio of complementary assets that can create a sustained competitive advantage and deliver attractive returns throughout the commodity cycle. As we evaluate growth opportunities, we focus on 3 investment criteria in addition to the underlying technical attributes of the asset. The first being cost positioning the Kalahari manganese semi carbonate producers are all generally positioned quite close to each other on the cost curve. However, value and use can become a differentiator. In other words, having a higher grade product lower iron content or oxide ores, for example, can all contribute to an appealing basket of products, which could attract premium pricing. The second is scale in logistics and marketing access. Rail and shipping impacts costing. And given that more than 60% of CIF cost sits in the freight and logistics disciplines, cost management in these areas becomes an important source of competitive advantage. The third is the ability to unlock synergies. As we build scale, this must be demonstrated across any acquisition or merger. Ultimately, growth must be pursued within the same disciplined capital allocation framework that underpins all of Exxaro's investment decisions. Leon will cover this in more detail later. Scale alone is not the only objective, creating sustainable shareholder value is. As mentioned earlier, Copper remains a strategic focus for Exxaro. Following our participation in the [indiscernible] process in 2023, we refined our approach to the sector with the focus having shifted away from producing assets towards exploration. Exxaro's exploration team has decades of institutional knowledge, having been very active in mapping and assessing the Southern African geotechnical landscape and assets within those regions. We have a very strong geological understanding of the copper belt spanning the DRC, Zambia, Botswana and Namibia. Our initial focus was on advanced stage feasibility projects, will suitably derisked opportunities. It soon became apparent that many projects in this phase had already had access to strategic partners or capital. Therefore, over the last year, we have increasingly focused on earlier stage projects, where there is naturally increased risk, however, at the same time, lower investment outlays and the ability to provide longer-term support for Exxaro to unlock value. We currently have promising opportunities that have progressed to advanced discussions, and we are hoping to advance these select opportunities further over the course of the next year. Lastly, how are we thinking about our existing minority investments. At a high level, session iron ore company, where are is a 20.6% shareholder remains a core investment. [indiscernible] is a producer of high-quality iron ore and has been a consistent dividend payer. The pass-through of the Sao dividend enhances our shareholder returns. Kumba, our partner in [indiscernible] is building a longer-term business case, which could see production and positive cash generation beyond 2050. This is being facilitated by the UHDMS process, current or a project currently being tested and constructed on site. We note the developments with the Anglo tech merger and look forward to partnering with the new majority shareholder of Kumba for the next 20 years and more. In contrast, our interest in Maromba South Metallurgical coal joint venture in Australia and our 26% stake in Black Mountain zinc mine and plant are currently not considered core to Exxaro's longer-term strategy. Zinc does not form part of our long-term commodity focus. As communicated at our previous Capital Markets Day, we continue to evaluate options regarding our investment in Black Mountain. And therefore, an exit of our stake is still being considered. Vedanta remains on track to develop one of the world's largest zinc refineries with the expansion of the Hamburg complex, the development we have supported and can be proud of as a country. That brings me to the end of the business development overview, I hope that this has demonstrated that our continued value-accretive growth aspirations are in line with the strategy. However, they are not at any cost. Our approach continues to be guided by disciplined capital allocation, strategic focus and long-term value creation. With that, I now hand over to covernization strategy, who will take you through our decarbonization strategy. Thanks everyone.

Thank you, Richard. Good afternoon, everyone. I'm [indiscernible] Executive Accountable for sustainability. I'm here to talk about and in Exxaro, which is decarbonization. My segment for today focuses on Exxaro's decarbonization position. our pathway to cover neutrality by 2050 and how we are balancing climate ambition with operational resilience and a just transition. Exxaro's Carbon emissions management approach follows a clear mitigation hierarchy. First, we seek to avoid emissions where possible, where avoidance is not operationally feasible we focus on reducing emissions through technology, renewable energy, fleet optimization and improved energy management across our operations. For residual emissions, we use carbon offsets as a final layer of mitigation. These include a forestation and [indiscernible] energy solutions that support both reduction and biodiversity enhancement. This approach and shows that our offset expenditure represents genuine last resort mitigation rather than a shortcut around structural changes. It provides shareholders with assurance that our capital is directed first to the most impactful emissions reduction opportunities. Our strategic objective to achieve carbon neutrality by 2050 rest on 5 pillars and each play a distinct role in reshaping the portfolio over time. The first pillar is asset reconfiguration, and this is where we deploy practical technologies, including renewable energy, fleet optimization and energy management to structurally reduce Scope 1 and school 2 emissions at our operations. The second pillar is portfolio diversification. Growth in our Renewable Energy business synergy and exposure to future-facing minerals such as manganese will help reduce the carbon intensity of Exxaro's portfolio over time. And our examples include the acquisition of selected manganese assets from Sibania Holdings and synergy projects such as the Career Postrefarm on the Western and Northern Cape order. The third and fourth pillars are carbon offsets and value chain partnerships. These addresses residual and had to update emissions where collaboration is essential. The fifth pillar is our contribution to a just energy transition in South Africa. For Exxaro, this means optimizing our core assets responsibly, investing in lower carbon growth platforms and working with our suppliers, customers, government, communities and other social partners. Our short- and medium-term emissions targets remain viable, a 40% reduction by 2030 and a 75% reduction by 2040. Our road map has been rebaseline to reflect the operations fully owned by Exxaro, the life extension opportunities as outlined by Caroline and also the expected portfolio depletion. The road map further illustrates that our Scope 2 footprint is higher than our Scope 1 footprint, mainly due to electricity consumptions at our operations. And this is why Leon is important, our renewable energy remains one of the most important near-term levers in our decarbonization plan. Various technological interventions as well as energy efficiency projects will be implemented to mitigate Scope 1 emissions. Our Scope 2 profile is significantly mitigated through our renewable energy projects, especially in the short term. For example, the Leepalale solar plant, which is our behind-the-meter solar PV at Halk that significantly reduces our reliance on carbon-intensive grid electricity. In line with the mitigation hierarchy, carbon offset projects will be used to address residual emissions that remain after avoidance and reduction measures have been implemented. The reduction of Scope 3 emissions remains an imperative to our business despite the challenges associated with the use of our sole product by customers. Our response is a reliance on value chain influence through our MOU partners. We've got Astom and the Council for Geosciences. We are participating in research and development work that they're doing, especially on the carbon capture utilization and storage technology. In conclusion, our targets remain credible and on track, the 40% reduction by 2030 and 75% by 2040. This also includes our carbon neutrality by 2050. This strategy is executable. It is not just aspirational. However, Scope 2 realization demands partnerships. Coal carbon-intensive end use means we cannot decarbonize unilaterally. Partnerships with Eskom and the Council for Geosciences remain central to our value chain strategy and Scope 3 mitigation plan. We view carbon offsets as a strategic instrument, not a shortcut. They are sized to match residual emissions and generating removal credits beyond 2050. This is a deliberate final layer in a sequence mitigation hierarchy. Looking ahead, success for us means deploying technology intentionally and growing our renewable energy solutions business, also looking at our future-facing metals portfolio. while we ensure that the transition delivers for the employees and the community who depend on our operations. Exxaro is deliberately reshaping itself for a lower carbon world. Thank you. I will now hand over to Riaan.

Not -- so we are going to go to the questions quickly, and then Riaan is only going to come after the Q&A for metals and decarbonization.

Brilliant.

So again, we will take questions in the room, and then we will go to online platforms. So please, if you may raise your hand if you would like to answer your question.

Richard, a question for you. I appreciate that you can't share much more on Makala. But just in terms of activity in your division, just in terms of how busy you guys have done. You've done a transformational deal, right? You brought manganese in and then shown us a very nicely diversified pie chart of sort of diversification across the group. I suppose the question is every mining company is looking at opportunities all the time. But then there's active desire and kind of not just opportunistic, but active desire to effect another transaction because you need to achieve something like a diversification goal. Can you give us a sense of how much of this is active versus an opportunistic or, let's say, more passive, which is what most companies are doing most of the time?

Thanks, Tim. I think as you would have seen, we've dropped the targets of x percent of EBITDA by a certain time. So there isn't this pressure that we have to do deals by a certain time. There's an aspiration to become more diversified. And within that, we have the capacity to think about what the next deals are. I think to answer your question, having done the manganese deal, it leads its way into a couple of other deals, which now become more call it, the visibility is better. So we don't stop working. We carry on with a number of opportunities to see if we can unlock value. A lot of them, we can't. And there's -- the challenges we found before with different shareholders, different interests, et cetera, are still there. The risks or the challenges haven't gone away, but there's a pathway of work that we are working towards to say, if we want to be bigger in manganese, what is it? What are the copper opportunities that we are having good engagements with? And if they lead somewhere, that's great. They'll still need to meet our hurdle rates, et cetera. We'll invest. So there's a strong pipeline of opportunities, which feed into our diversification strategy, but they're measured. So we don't feel that we're under pressure to do anything by a certain time.

We'll take Brian. And then please, can you also send the mic to...

Richard, on Maranba South, the $3.9 billion that Anglo agreed, I believe that was just included their 50% share of Maranbah.o you have a tag along? And if so, what would the value be that you would be looking for your share of Maranba South?

So short answer is we don't have a tag. We only have preemptive rights. So what that means is at the appropriate time, we'll receive the offer that Anglo has received for their 50% stake, and we'll have to opine on the valuation and decide whether we want to preempt or not. That hasn't arrived. So at this stage, we don't know what the value is. But given that the offer is in the public, we are expecting that any day now.

From Investec Bank. The question is for Richard. You talked a lot about manganese needing scale for you to generate sufficient value. What level of scale or what is the minimum as far as scale is concerned, where you will be comfortable that you will be able to manage this risk that you have seen related to prices and supply.

Can I tell you when we get there. So is there a number? Yes, there is a number, but I don't think it's -- I'm Ben is more than welcome to tell you what it is. But I think it's one of these aspirational what is big enough, what's too big? At what point do you run into competition issues? At what point do you start not seeing benefits in scale in South Africa. So I think there's a lot to unpack in what scale means to us. There is a number. I'm not going to say it now.

I think, I think the reality is, I think market analysts have all spoken around the importance of consolidation in the manganese sector. I think we can all see the bleeding of our own economy and our own jobs and the fact that the fragmentation is not helpful with the supply-demand dynamics. So we said when we announced that this is a foot in the door, and we are very pleased that we bought into low-cost assets. But we think if we maintain that low-cost position, if there's anything that can be added to give us that competitive position of low cost and drive the logistics as well, it is attractive. We -- fortunately, we have told our investors, and we are very happy to give back the cash as we promised, and that's not going to change. But I think what may change is if you said what would be our aspiration, I think if we are not top 3, we would not be happy.

We've got a question...

Just to clarify on that point, if you're not top 3, then you won't be happy. So is it fair to say that TP is the largest transaction that you've made and it's not feasible for you to buy an asset that's bigger than TPN, given the fact that from a capital allocation point of view, you've promised investors that you won't build the cash. You already have the ZAR 4 billion that earmarked for the assets that's pending with Glencore. And then obviously, you bought another asset. I just want to get a sense of the guardrails of this M&A strategy that you've got because even though you can't communicate with us as to what's the ambition in terms of volumes, but only you can make a promise to shareholders that the deal is -- the TPM asset was the largest that it gets. Can you give us a sense of that from a spending point of view?

I think it's a challenge, and I think you will understand why. And I'm glad you're saying you can't quite give us a direction, and you're right. I think the bottom line is that we're not -- Richard was very clear. And I think I couldn't have put it better saying we are not chasing size at any cost. We know we have a very stringent investment criteria, and we know how we have spent our shareholders' money. We must make the money back that we have already spent on the assets we have. So our priority, if you look at what are we going to worry about in the next 2 years about making sure we make money that we spend on our assets to make sure our shareholders are comfortable with the value we are making out of it. So it's not at any cost, not for any size, but we realize market commentary that consolidation is possibly better for the fundamentals of managing supply and demand and getting the benefits out of that for all our stakeholders. So I think that's the best we can give you today. But yes, I think not at any cost, but we really think the industry does need a market leader.

Just 2 very quick follow-up questions. The first one is, have you spoken to Kumba recently about going towards listed level? That was a conversation that happened a while ago, I believe, and the prior CFO of Kumba wasn't so keen. So the changes at Anglo and the group, I just wondered if that's come along. And then secondly, can you just remind us if the tag is taken at Mokala, which we assume it is, and you're doing commercial discussions around offtake or marketing or whatever, what's the total amount or the maximum amount of cash that you'd have to spend on Mokala? Is it -- was it $1.5 billion and then double that to 3 billion? Is that the round number?

Answer the first Well, on Macala, you're absolutely right, it's 1.5, around about that, which would double up. The point is we said to the market, the total transaction side would not exceed 14.6%. And I think we're going to come under that because we settled or we closed Senti earlier, so the escalation has stopped ticking on that. So we're going to come under that. And there's no world in which we're prepared to pay more than that. So yes, that's on the tag. That would be our price expectation on Makala. On the Kumba flip up?

On Kumba, I think the -- as you say, as you all know, we're watching the Anglo Tech transaction. We definitely think it's a good asset for us. We've been paying very good dividends that we pass through to our shareholders. I think in that sense, we'll see how the dominoes fall, but we really think that it remains a very good earnings business for Kumba for ourselves.

Right. Maybe let's go online quickly. And the question from says Slide 60 argues that the manganese market structure provides compelling case for further growth because supply is fragmented. Demand is coordinated Chinese ore producing brackets and there is unrealized opportunity to provide benefit for all stakeholders. The conclusion states that success requires beyond -- moving beyond the passive mining approach, becoming active market shaper. Does this imply there will be efforts to consolidate the market? History of the commodity market consolidation attempts is that producers who attempt to consolidate supply on the assumption of coordinated pricing discover that the new entrants and Chinese state-owned miners do not cooperate with the consolidation thesis, thereby leaving market with lots of supply. So the question is, does this imply there will be efforts to consolidate the market.

Actually, though his first paragraph, you could have easily have been working for Exxaro. But I think you know what a lot of these things will have to come in the watch. It's a matter of time. We watch what we see. What we have right now, we are very pleased with the transaction we have secured. TP is a low-cost producer and with very good the railing facilities are in place. Yan is busy maximizing value out of that, and we want to return our money to shareholders. I think Tim touched on the contractor model that we see there. We are continuously doing concept studies around, is it better to mine ourselves so that there is more value to our own shareholders. So there are many things that we can play around with. And we definitely agree with the thesis that we think supply-demand dynamics do not favor our Kalahari manganese field.

Thank you, Ben. And then just to close the loop necessity, you asked the question, anything might have wanted to add?

No, I think the statement says it all. In the semi-carbonate space, you have 5 or 6 mines all selling the same product to a coordinated market and it's used against us. So how do we change the dynamics in the market? At that CP, there were 3 marketing companies marketing the same ore prior to us arriving. So there's a lot that we can do better in this space.

We can assure you it's top of mind for us. We are not going to do it at any cost.

Thank you. And then, of course, Richard, you've taken the question of take along right at Moramba. So that answers necessity from Aluwani Capital. We have another question from Nana in the room. And please let me just remind everyone online remember to post your questions on the online platform so that they can be sufficiently taken care of on the floor. Thank you, Nana.

Cool. Two questions -- follow-up questions from my side. From the slide that Ben, I guess, presented earlier on where the ambition is to get to 20% of earnings contribution from the metals, what are M&As assumed there from a manganese perspective? And is the potential copper acquisition also part of that journey to get to that 20%? How should we think about that? And then the second question is -- can you tell us about the alignment that you've got in terms of your consolidation ambitions with your partner, Jupiter Mind? Because from an Exxaro shareholder, obviously, if there's alignment within the shareholder, then there's a case to be made that perhaps you can derisk your own consolidation ambitions because you've got an asset that stand-alone that you bought that runs a net cash balance sheet and can actually in the fund its acquisition if it buys assets that are potentially smaller than it? Or is the aspiration to consolidate is the framing that this is a pure Exxaro trying to buy asset on its own, in which case you will be using the balance sheet of Exxaro almost entirely. Could you give us a sense on the capital structure as you think about this consolidation efforts and how we should think about it?

I think -- the pie chart with all at 40%, and as I keep saying around minus, we can't count much. So say 40-20, 2020, as you would have seen on that earlier slide. If you look at Rian's numbers, which are more an accountant numbers, you possibly see that the under 50% is about 47%, possibly playing to 40% at some point because as we all know, commodities prices will do what commodities price do. And sometimes coal is against manganese and sometimes manganese is against iron ore. So we do appreciate the pie chart will keep moving from the numbers that we've spoken about. But on average, we expect coal to still deliver between 50% and 40%, and it will play around that. And we expect the other commodities, including renewable energy to provide over the 50% in terms of earnings by 2030, even give or take the various prices. So you talk about the consolidation. I think if you did a pro forma of that pie chart in 2025 as if the assets we targeted have now been in the house fully, we possibly find that, that number sits somewhere around 18%, 14% if it's just Ty. And if you top up Mokala, which is still remaining productive as Richard said, it will be up a little bit. So is there scope for synergies? Yes. Is there scope for optimizing and efficiencies and what additional value we can make? Is there another asset in there? We think so. So I don't think we can say it's over with what we see. However, we think we do not need to break a bank and compromise our investors with whatever opportunities we need to do, given we remain a very cash-generative business, and we will continue to do so. So if you did the pro forma for 2025, you possibly see that it's slightly lower. If you did the pro forma for 2026, 2027, you can assume whether Mokala is in or not, you will see that uptick. And could there be something else to take us to the 20. So maybe manganese will be sitting somewhere between 15 and 20 depending on where the world sits because we are not going to pay for any price. We are not aced on size. we definitely believe we can play around at 15%, 20% range. The pro forma does show that there may still be another puzzle to fix before 2030.

Thank you, Ben.

And Riaan will cover a little bit more around that, and we can see again when it comes through. Richard, is there anything else I might have missed on Jupiter?

Yes. So on the Jupiter side, Johan has talked about our working relationship there. It is an interesting question you asked because given the existing shareholder relationship we're walking into, Jupiter does have rights to co-invest on further opportunities. Some are excluded where there was already an investment by Simbente. But in general, they have these rights to co-invest. So we would have to engage with them on -- if there was a smaller asset, as you say, or some deal that we'd like to do, we would engage with them to see if they'd like to co-invest and use their balance sheet to come in with us. So that is an option or a right that they have, which we would exercise on any discussion going forward.

Are there no further questions in the room? I think I will propose, given that we've just moved from lunch, and I think we -- I think I will propose that Riaan will come into the capital allocation framework. I think from a timing perspective, that sort of moves nicely. Are there any further questions that we would...

Ask Neo a question.

Would be helpful in that sense with what Richard just hinted that I think accelerating our decarbonization program to make sure we're carbon neutral by 2050 is quite critical. The portfolio is getting bigger. If you look at what we say around the pie chart you spoke about, you're almost seeing if coal is making ZAR 10 billion, then we are looking to be making ZAR 20 billion, including other minerals and resources. I think there's definitely more emphasis on how we are decarbonizing, how we are reducing our carbon intensity because of diversification, but the offset projects become even more critical because that's a residual still remains. So I think we're still very excited with the hard work that Neo and team are doing. And I can see Namanja has got a comment or a question.

Question for No, given the...

We thought you were nicely answered. No one's foot on there.

No, a quick one for you. So the path to carbon neutrality as Exxaro pursued its strategy to actually, I guess, reducing its carbon intensity. How should we think about that being a contributor to a potential acceleration of the company's CapEx intensity? Because if you think about it, up until this point, say, in the last 5 years, what investors have seen in Exxaro is a very steady CapEx profile. So if we think 202030, and you mentioned that by that time you would have achieved 75%, how should we think about the costs now versus what you've achieved, say, in the last 5 years?

Thank you. And my job is quite easy because Caroline and Leon, they've covered that. You've seen Caroline's CapEx or stain business costs going up. That's purely because of the trucks and the shovel replacement, but that's also making sure that we buy the right technology that supports decarbonization. That will address our Scope 1. When you look at our Scope 2, most of -- almost 80% of our Scope 2 will be addressed by the renewable business. Leepalale is already contributing green electrons, and we're looking at wind solar and wind. So if you look at our Scope 1, Scope 2, that CapEx has already been addressed by what is included in the coal business and also what's included in the energy business.

Thank you. I will then welcome Riaan and...

Thank you. Good afternoon, ladies and gentlemen. So I'll talk to you probably the most interesting part, the capital allocation in the group and making sure we keep all of them honest. So since 2018, Exxaro has evolved its capital allocation framework in response to the portfolio diversification and also the changing market conditions. So historically, the group was focused on maintaining a strong balance sheet and self-funding expansion capital ahead of dividends. However, as the business diversified, the framework was repositioned to strike a balance between the sustainability of our operations and support functions to ensure asset reliability, operational continuity and our ambition to be carbon neutral by 2050. Also the balance to deliver consistent and superior returns to our shareholders and then lastly, to support the growth and diversification across both Minerals and the Energy business. So this evolution was done in a very prudent manner, ensuring that the group maintains a strong balance sheet and the flexibility required to navigate commodity cycles. So today, capital allocation remains one of the key disciplines within the group. To illustrate this, if we look at the evolution of the framework, so in 2018, we enhanced the shareholder value proposition by introducing the pass-through of the SIOC dividend and implementing a dividend cover of 2.5 to 3.5x cover on the group adjusted earnings. And then by 2021, the framework further shifted with dividends being prioritized ahead of growth and expansion. Then in 2023, we introduced the ZAR 12 billion to ZAR 15 billion cash buffer. That was an additional layer of prudence, ensuring that we've got sufficient balance sheet flexibility to support the long-term diversification and growth. So this disciplined approach to enable us to fund most of the strategic initiatives, notably the manganese acquisition and the expansion of the energy business while still maintaining consistent shareholder distributions. So our increased confidence in the group diversified earnings base the balance sheet resilience and long-term cash generation resulted in 2 key enhancements on the right-hand side of the slide. So firstly, the removal of the cash buffer, the ZAR 12 billion to ZAR 15 billion and then a revision of the dividend cover ratio to 1.5 to 2.5x cover while still maintaining the pass-through of the SIOC dividend. So importantly, these enhancements do not represent a departure from our financial discipline, but rather reflect the confidence in the resilience of the business, the strength of our balance sheet and our enhanced liquidity position. At the center of the capital allocation framework is the group's ability to generate free cash flow across commodity cycles supported by the diversified portfolio, our strong liquidity position and also disciplined investment criteria for new investments. So here, we illustrate how we expect to allocate our free cash flow based on internal projections. So we forecast up till 2030 that about 5% to 10 -- 15% will be applied towards debt servicing, 15% to 25% to sustaining capital, including any sustaining capital associated with the manganese business, and we expect 30% to 40% to be returned as ordinary dividends through the SIOC pass-through and the enhanced dividend cover ratio of 1.5 to 2.5x. And this includes the earnings associated with the coal business the minerals business as well as the energy business. And then lastly, a further 30% to 40% to be allocated to growth opportunities in the new energy and also in the minerals growth businesses. So to the extent that surplus capital is available, we foresee that special distributions to shareholders will still be considered either through share repurchases or through special dividends. So our commodity price forecast up until 2030 is also included in the additional slides. So as pointed out earlier this morning, we believe prices for coal will remain very supportive as the role of coal continues to be reinforced in the global energy mix. Manganese, we definitely see weaker Chinese steel production to place pressure on prices in the near term. But however, we anticipate supply tightening from 2030 onwards. And together with the slow but growing demand from battery technologies will support a constructive outlook for manganese prices in future. So Exxaro's capital deployment remains centered on disciplined investment, sustainable returns and long-term value creation. The group applies this framework across 5 key priorities. So firstly, debt servicing, ensuring resilient balance sheet structure, liquidity and also financial flexibility. Secondly, sustaining capital where we invest to maintain the coal business and the other businesses, operational reliability, our safety, our environmental stewardship across the entire asset portfolio. So this also includes, as we pointed out earlier on selective life extension opportunities within our mining operations. As mentioned earlier, we expect an increase in the capital in 2026 and 2027 due to the fleet replacement at -- for the manganese mines, we do not forecast significant sustaining capital. As pointed out, it's mainly a contractor mining model. But if you look on average over the past 5 years, the capital was about 60% per annum for the mine. Also very important is we are also completing a feasibility study to replace our current ERP system. So our current system has been running for almost 16 years. The system will not be supported going forward. So we are looking at a solution to support the integration of our business processes, also improve productivity and enhance data security insights across our businesses. We are busy with this study, and we'll give you guidance probably by the end of the year. Then as I already explained, shareholder returns with ordinary dividends prioritized after sustaining capital in line with the dividend policy. And then fourth on our circle is the growth and expansion where we allocate capital to opportunities across renewable energy, the transition metals to support our diversification aligned to our investment criteria. Then as pointed out, to the extent that we've got excess cash that may be applied through special distributions, either special dividends or share buybacks. So we aim to, as explained earlier, achieve a return on capital employed in excess of 20% on our mining portfolio and then equity returns in excess of 15% on the energy portfolio while still preserving financial flexibility. On the next slide, we focus on the balance sheet and also our liquidity position. So as pointed out during the year, we refinanced our ZAR 10 billion corporate facility with a new facility. The new facility is a ZAR 13 billion facility comprising of a bullet facility, an amortizing facility and also a revolving credit facility. So it again, has a 5-year tenure and provides us with flexibility and also funding capacity. So this facility when we raised it was 1.85% oversubscribed, and we secured improved commercial terms and also a 14% improvement in the pricing margins. So this successful refinancing also reflects the confidence from Exxaro's lending partners in the group's diversified portfolio, the balance sheet strength, the disciplined capital allocation and long-term earnings resilience. So as you can see on the slide, we've got total available liquidity of about ZAR 20 billion, consisting of a combination of the term loans as well as also a medium-term note program that have not been drawn down as yet. And in addition to this, we also have cash on hand of about ZAR 8 billion as at the end of May. In the additional slides, we set out further details of the terms and condition of Exxaro and Synergy's debt facilities. On this slide, we look at the risk and returns for the various portfolios. So when evaluating and analyzing projects, we utilize a portfolio return framework, which is designed to align with the different risk profiles of our energy and mining businesses. So starting with the overall principle is we use weighted average cost of capital as a key metric, ensuring that investments deliver returns in excess of WACC, consistent with the risk return characteristics of each portfolio. So for the energy business, the focus is on lower risk and stable returns where according to our calculations, the cost of capital is probably about 3% to 5% lower than the mining portfolio, reflecting the lower risk, the higher gearing potential of these assets because these assets are infrastructure type assets with high predictability of cash flows. So normally, we typically structure them through 25% equity and 75% project finance. And also mentioned by Leon, traditional metrics like ROCE are not appropriate due to the nonrecourse nature of the project finance debt on the balance sheet. So we target an overall equity IRR of 15% across the energy portfolio. Overall, the energy portfolio delivers long-term predictable cash flow, lower volatility on a risk-adjusted basis and also very importantly, societal returns through our decarbonization strategy. In contrast, the mining portfolio, including coal and metals is positioned for higher returns with higher risk exposure. We target a ROCE above 20% for these portfolios as they are supported with favorable supply-demand fundamentals. We're looking at cash-generative assets that supply synergistic opportunities across the operations. And finally, also exposure to structurally attractive commodity markets. So unlike energy, the mining business relies more on traditional corporate funding structures, making ROCE appropriate performance metric. So in conclusion, our capital allocation has evolved as we strike a balance between sustaining and decarbonizing our operations, delivering risk and superior returns to our shareholders and positioning the business for growth in coal, energy as well as select minerals. The balance sheet remains resilient, underpinned by strong cash flow generation and also sufficient liquidity. So through the disciplined capital allocation, we can build a diversified portfolio, delivering superior risk-adjusted returns to our shareholders. So our capital allocation framework is also supported by clear financial guardrails and internal performance thresholds designed to preserve liquidity, maintain disciplined leverage and ensure we get the required returns. So our key performance indicators that we aim to maintain as we implement our strategy is for the net debt-to-EBITDA ratio, excluding project financing to remain below 1.5x. So our covenant with the banks is a covenant of 3x. The coal business, the EBITDA margin to be at least 25% and then a ROCE of more than 20% on our mining investments and the 15% equity IRR on the energy business. So the capital allocation framework, together with prudent financial management measured against these KPIs support the diversification, our decarbonization ambitions and positions the group to achieve a more balanced EBITDA contribution from energy and metals into the future. So as Ben pointed out there, there, you can see more or less 50% of earnings coming from energy and metals by 2030, although it is not growth at all cost. So thanks very much.

Thank you. I'm not sure I see the numbers that well, but thanks, Kopus. Yes, ladies and gentlemen, it really has been a great day to be with you. I will go through the conclusions. And then after that, we'll possibly take questions so that we can close the Capital Markets Day properly, and then we'll immediately then move and ask Riaan to go through the pre-close. So if there are any questions for the pre-close that we also announced today, Riaan will then take that up, and we will take that up after we have closed the Capital Markets Day. So yes, in concluding this day, I really want to return to where this journey began in 2021, when we introduced our sustainable growth and impact strategy. and outlined our ambition then to build a diversified natural resources business while continuing to power better lives in Africa and beyond. Today, you would have seen how that strategy has evolved possibly from initially a dream to an ambition and to reality that we have here today and the various pies you saw in that graph. The world needs responsible miners like Exxaro to mine coal responsibly, and we will mine that coal to demand. Therefore, we are strengthening our coal business with life extension opportunities in every operation. taking cognizance of the demand dynamics and making sure there is energy security and while still driving our decarbonization. We are establishing a globally significant position in manganese and are also expanding our renewable energy platform to at least get to 1,600 megawatts. All this we're doing, maintaining our stringent trend lines and focus on disciplined capital allocation as we accelerate our decarbonization by reducing our carbon intensity. Together, these achievements are really transforming Exxaro into a natural resources champion, one that is leveraging on the strength of its existing portfolio to build a more diversified, resilient and focused and sustainable business that we are all very proud of. You look at that, and you can see the demand. And if you look at South Africa as a map today and where Exxaro is beginning to operate, if I had shown you earlier where it was and where in 2001 -- in 2021, never mind 2001, '22 have been a big difference. But the difference 5 years ago to now, almost some of those numbers. This is really creating a diversified natural resources portfolio of long-life, high-quality assets that sit at the lower end of the cost curve, anchored in South Africa at a jurisdiction we know and love and connected to the global commodity and energy markets. This is critical for us in managing risk and in managing what we can and ensuring management concentration in the areas we operate. Our footprint gives us exposure to commodities and solutions required for any security and industrial development and also for the energy transition that we know we have to drive. But it is about having responsible companies like Exxaro to drive that. So today, Exxaro is a diversified natural resources champion with embedded optionality. If I look at what we saw with GG and how we need to drive the logistics, we can unlock a lot of value in Exxaro just from our long-life coal assets. And we have a long-life coal franchise, providing this cash generation and really the defensive earnings that we continue to drive. A globally significant manganese platform, providing that diversification is something that we think will continue to grow. And the [indiscernible] you hear is in due course. And the renewable energy business that's strengthening the defensive nature of our portfolio for long-term annuities. I think I remember in my young days when Exxaro owned are not and we owned quite a few around that. If you think the prospect of Matla now has given us real strength in those annuities, our renewable business is anchored not only in providing those annuities, but actually also in decarbonizing our business. And we have seen that happening. The new green electrons at GG at 68 megawatts are reducing our electricity costs on that mine by ZAR 100 million a year. It makes this decarbonization makes money. And I think it's through responsible and disciplined capital allocation framework with a proven track record of sustainable and superior returns that we continue to do that for our shareholders. So these businesses are complementary. They are driven by a strong leadership that you have seen here today and a clear and streamlined strategic direction from the Board. And I want to thank the Board for their support as well. So throughout this transformation, we stay committed to shareholder returns. Since listing, we have maintained a consistent dividend track record, I think we should have paid [ 40 ] dividend because of interims if it's 20 years. And as you heard Riaan, we paid 46x which includes special dividends, some buybacks, you name it. So I think we want to maintain that consistent track record in paying dividends and returning substantial capital to our shareholders who continue to support us. While we are able to invest in a sustainable future that we know we need. And our objectives remain clear: balancing growth, resilience and stakeholder returns for all our stakeholders, including shareholders. So Slide 84. As we close this, I would like to repeat this slide. Koppes spoke to it. And I think, Riaan for those who don't know who Koppes is, I think it is important that I repeat it again. These [ metrics ] provide a key framework of how we measure success in this new dawn in the next phase of our execution. They reflect a portfolio that is -- that remains anchored by our long life quality coal assets while we're able to grow our export business but also driving these future-facing metals and renewable energy business. This dashboard keeps us awake. It reflects our commitment to keeping financial discipline, operational efficiency, reducing carbon intensity and creating long-term value. So as we celebrate Exxaro's 20 years since listing, we are proud of what we have achieved and the predecessors that came before us, but we're even more excited about what lies a hand, and we hope you join us in that excitement. So to my 22,500 colleagues, let's keep doing the best work of our lives. Together safely, we dig Africa. Thank you. Yes. And Anda, please come along. There will be more questions for Riaan.

All right. Thank you. Thank you so much, and I see Tim has already got its end up and we're going to go to this Q&A. And then, of course, we will then transition into our FD pre-close session.

Just 2 quick questions. The first one is, can you just give us your sense and thoughts on the replacement of the EE deal? And obviously, there's uncertainty on the mineral legislation and how you think about that and how we should think about it? And then secondly, just on Slide 74, Riaan. If I look at the amount of dividends you've paid historically over the last few years, it's higher than the 30% to 40% of dividends that you show. So the difficulty I've got is a timing issue, right? So let's just say you earn some cash and you're sitting in a net cash position, but over time, you want to invest more, you want to grow, you want to buy some stuff in manganese or consolidate, et cetera. Will you do those through debt or because you've given away your accumulation target. And so you've got this difficulty of deals taking a long time, but earnings being reported every 6 months. And I'm trying to work out how you're going to balance that, how we, as investors, should think of certainty on that.

Thank you -- we note that. Are there any further questions? There is no [indiscernible]. Any further questions, please remember to raise your hand so that you can get your mic.

Okay. [indiscernible] slightly asked the question that Tim asked on the balance sheet positioning, Riaan. So if we think about your net debt to EBITDA target of less than 1.5x and then considering the company's consolidation effort to growth aspirations that if you're assuming that 100% funds, whatever consolidation efforts, at least what I'm trying to understand is how conservative it is within the context of the company that's trying to actually buy other businesses. the recalibration of that 1.5x, what are the key assumptions that you put in there for your own purposes in terms of capital allocation? And then the second question that I've got is, if we think about the decision-making framework that led to you guys moving from, as you say, 1.5x rate target on returns for growth aspirations to now saying that you just wanted to be greater than [indiscernible]. What are other decision-making format that led to that? In other words, what are the key factors that actually led to Exxaro actually pushing to guess evolve that decision. Yes, that'd be very useful from an FD perspective.

I think you can take question here, and we'll move to [indiscernible] after that.

Okay. Yes. So on the BEE transaction, remember, the current transaction will only unwind in the end of next year. So there are ongoing discussions between us and the current shareholders. Obviously, I think transformation for us going forward is very important but they have also been with us for 20 years. But we're also mindful that we don't want to incur facilitation cost, all of that again. So I think we, at the moment, in those discussions, but we're also waiting for the minerals [indiscernible]. We don't know how the minerals [indiscernible] will work out whether there may be or requirements for ESOPs for community schemes. But I think although it doesn't sound like there is good alignment between the 2 parties on the way probably going forward. Then the other one was the -- on -- so by removing the cash buffer our base case scenario is almost that we will be debt-free cash-free always. And to the extent that you do a major acquisition that will cause us to move into a net debt position. That is the how we model it. It's a normal course of business. If nothing happens, debt free cash free. And then acquisitions, we've got the facility. We've got the cash generation that we can employ towards that. And then on returns, I think in the current landscape to always get opportunities on a stand-alone basis to achieve WAC times 1.5x is very difficult. If you put them together as a portfolio, then it's more achievable. So that was the fencing just on a stand-alone basis to get that specific opportunities is very difficult.

And then I think, Tim, I could just add on what Riaan said on the BEE unwind that I think while we accept that is December 2027. We also know that this is a great BEE success story is in Exxaro. And these shareholders are founding shareholders of this company. So -- and we know they have been paid handsomely for their risk and for the work they put in and really -- and they remain very proud of Exxaro. So with [indiscernible] will possibly, like any shareholder out there today, I think they possibly will find that Exxaro remains the most attractive to invest in. So is there a way to continue. We definitely think that the opportunities exist to the extent it does not compromise any new legislation that comes through and anything that we think is at the appropriate as we evolve. I think we know our employees. I think I remember [indiscernible] was going through a meeting today around our employees and the ESOP we have, the community trust. So I think all those things we will reflect on, but we really think that having founding members that have made their money handsomely who are so proud to be part of this company should find a walkable arrangement that we seem to be evolving through current discussions.

Here's my question is for Riaan. And it's relating to GG. To unlock greater value from that operation, I think, from the presentation today, it became clear that you need rail. And over time, you need higher capacity for rail. So my question is -- and in my mind, the solution is private participation, right? My question is, could that the private participation could it potentially require capital allocation from Exxaro? How are you thinking about that?

Yes. So I think Caroline also addressed it in her presentation. We've got now the technical report on that line to know what capital may be required. So we're currently busy studying that. Now I think for GG, there's 2 solutions. There's -- one is more a rolling stock solution where you need more efficiency on the railway line, additional rolling stock. So those are options currently in discussion with Transnet and then there's -- and that should theoretically could get the line back to the 4 million tonnes that we spoke about earlier. So currently, we're only moving just over 1 million tonnes, theoretically, metal should be moving also 1 million tonnes, but that is due to the efficiencies on the line. And then there's obviously your longer dated opportunities to improve the total capacity on the line. But what we think is they will be through the concessioning type of models, where you should be able to do it not through. It could be that you've got an equity stake in the concession, but third parties could carry most of the risk. And you in exchange for that will give off take and pay a tariff. I think that is probably the base case that we assume. But we think they are more competent counterparties like train operating companies that could take those leases, and we may take a slide, but we can assure them of offtake, which I think might be helpful.

I don't know if you cover this. Excellent. So we go to Brian. [indiscernible] send up. And I just want to remind people joining us online to remember to post your questions on the online platform, and we will recognize those questions. Thank you.

Just those [indiscernible] return hurdles that you provided a 20% ROCE on mining and a 15% IRR on the energy business. That's a portfolio total is not individual assets, right? And obviously, GG, very high-return business, provide very undemanding return hurdle for the rest of the portfolio? Just your thoughts on that.

Look, your -- what you must remember, GG is now capital-intensive phase in the next couple of years that has got an impact on your returns. But we think if you look at through the cycle, the 20% is appropriate that, especially now with the higher CapEx cycle coming up, the 20% is appropriate. And then as you pointed out, we look at it over the overall portfolio. I think -- were you also commenting that what's the story with the others because they must be a lot lower and what's the thinking? And I'd like to pass that to Riaan again.

Now -- so remember, we look at it as a total portfolio. So especially with the blending of the coal. We don't look at it separately GG from from the rest of [indiscernible] longer. And if we look at the total product that the whole portfolio can sell the returns, and part of that, when we look at the overall portfolio return. That's why we don't look per mine or it could be that that one of the mines you spend capital, but you use some of the GG coal to upgrade the coal to RB1 and then the 2 in total, give you 20% whereas if the [indiscernible] line didn't get to GG coal, you couldn't actually sell that coal. Yes. I really think that's something that I think we continuously have to highlight to the market around, as we said, GG can produce a [indiscernible] CV, but slightly high sulfur, I think. And then we get a [indiscernible] in Belfast giving us a very low sulfur, but also low energy content. The blend gives us a premium RB1 for our customers, which is exceptionally high premium and to get the price realization, that's quite exceptional. So I think as a portfolio, there are real benefits. That's one. The second one is, obviously, most of these, the optionality when export coal prices fly sits in Mpumalanga because that's the -- those are the swing producing assets. So in the potential we are able to keep them running, in high price regimes, you actually have a massive kick in our -- in the export optionality and margins that one would get. So importance is to drive their cost price efficiency. And that's why I think Caroline and team [indiscernible] around what we are doing at Leeuwpan to make sure that as a minimum, it must wash its face because we know in periods like we've just seen now, if this was sustained at lower diesel prices, it could be different, it could be very exciting. So I think we saw that during the Russia, Ukraine time when it was only the coal price that went up and diesel prices didn't go up. This time, it's slightly different because the diesel prices have also eroded the margins a bit more. So I think the portfolio makes sense.

Yes. And then we are going to go to Lumada and then I'm going to quickly just run the online ones and then we'll come back to the room.

Riaan, on the noncore assets that have been identified, can you give us a sense on, I guess, potential value realization our book values that are on the balance sheet, a fair proxy of what can be anticipated? And I guess on the timing there of, I guess, the noncore strategy divestment because I guess the potential [indiscernible] case scenario here is you've got a number of equity investments within RE or a number of, I guess, bolt-on acquisition within [indiscernible], but the half that can be potentially funded by noncore assets that weren't giving us dividend anyway to shareholders. So what is sort of your thinking on timing from these noncore assets that you've identified? And I guess, the potential value that can be unlocked from a guess divesting out of those assets, yes.

Okay. So firstly, the -- obviously, the Maromba one, we need to follow now the process with Anglo so we can't really point what the outcome of that will be. And then Black Mountain, I think, obviously, Black Mountain -- it's always more difficult to dispose of these assets because it's a minority stake, and they don't come with offtake if it's a minority asset with offtake, it's easier to dispose now. As you may recall, a couple of years ago, we were looking to sell Black Mountain, but we we couldn't get the deal through. So your -- I mean, if you probably get the valuation the valuation of Black Mountain in the books is very small. I think our acquisition cost for that as it was like ZAR 200 million. But obviously, we're looking for something substantially higher than ZAR 200 million. That's not reflective of the value of the asset. So in the financials, there may be director evaluations for the assets. It will be somewhere in between those venues.

Right. So we are going to go online quickly, and we have a question from Thobela Bixa, from Nedbank. And his first question is, the different businesses have different return profile targets. How do you decide on priority in allocating capital to them? That's number one. And then number two, you spent close to 80% of your total free cash flow since 2023. When you announced the cash buffer. Given you intended to spend only you intend to spend only 30% to 40%. Does this mean we should expect potentially far less than the manganese purchase price. So the first one is the difference -- the different businesses have different return profile targets. How do you decide on priority how do you prioritize capital allocation? And then the second one is you spent close to 80% of your total free cash flow given that you intend to spend only 30% to 40%, does this mean we should expect potentially far less than the manganese purchase price.

So the prioritization is obviously the investment criteria. That's the first win we look at. And the project with the highest return will always get preference. But I think up till date, we haven't had that project where we didn't have sufficient resources to enable us to actually implement the growth opportunity. That's the reality. We have -- and then secondly, the -- what was the second one?

The cash [indiscernible]. So you spent close to 80% of your total free cash flow since 2023 when you announced the cash buffer, given that you intend to spend only 80% to 40%. Does this mean we should expect potentially far less than the Manganese purchase price.

Expect less on dividend?

Less acquisition I think, it's acquisitions.

I think you're saying we have -- on the current transition, we have spent ZAR 10.6 billion basically.

Correct.

We are likely to be spending a lot less than that going forward in any acquisitions, and we have a 18 billion facility that we have secured on much more favorable terms. And I think in most companies, like Riaan said earlier on, some element of debt is not bad. But however, we do not expect to spend the same amount we spend on the first transaction, far from it. So I think if that is his question and answer, I think we have covered that unless Riaan wants to add anything else. We don't intend to be spending the same kind of check.

I think you were clarifying when he needs to -- are there any further questions before we move to the prepared close, yes, to [indiscernible]. Can you send the mic to [indiscernible].

[indiscernible] from SBG Securities. You've clarified everything with regards to the current portfolio, but I'm still trying to kind of make sense of the plans around copper, right? It's the only one that doesn't appear to sit around the operating assets plan and it makes sense. And I'm just trying to understand how couples into the strategy going forward? Is it another source of production or will you be looking at deposits and turning them into resources. You've previously looked at the Kalahari copper volts. And I'm just kind like see like where does it fit into the long-term strategies of production? And how much are you willing to allocating CapEx to it?

On copper, we are looking at advanced exploration projects. We don't think it's -- because we think we can take it up the value curve with the competencies, I think your one was highlighting his competencies, and those are sitting in Exxaro quite strongly. So we think we can take it up the value curve. Will we be spending $10 million, $30 million is something that we think is affordable within reach of Riaan's short hands and without compromising investor investor dividend. So I think we -- I guess you never know until you find it, and it's opportunistic for us. So it's not like we are desperate to go find it. We are desperate right now to make sure we get value for our manganese investment. But we think that there may be opportunity that we don't compete with the measures in the portfolio they are looking at. We are looking at much easier, lower portfolios of 50,000,000 tonnes of copper care peer in terms of its prospects from its exploration potential. So I think it's -- it's not money that we think would be meaningful to impact our balance sheet.

And even in the targets, copper is not in there -- so it's not in those 50% numbers. So it's not in the number. So it's really for us, it's an entry that we think could we put some -- so you could think of what the exploration money looks like. And I think you would not be far off.

And then we have [indiscernible].

Sorry, Ben, just to ask a further question on [indiscernible]. I mean we know that you've got Eskom experience in mining projects. Do you have a specific jurisdiction that you prefer? I mean, the DRC, the nearby in South Africa. Like do you have your own priority ranking on where you would look to find copper deposits that you think you'd invest in? And what sort of the risk, I guess, criteria that you and Riaan will basically toss and turn about.

Yes, I think it's opportunistic. I did operate in the DRC for 3 to 5 years, I would say. I was traveling there once a month for a week, not that my home affairs enjoyed it, but it was -- it's really something that we're seeing, I think that if you look at the grades in the DRC, they are uncomparable. You look at miners mining around 0.3, 0.5 grams per tonne and in the DRC, you're looking at -- they still stockpile 1% grade of copper today in some of the assets. So is it impossible to operate, I think, without a local partner, it's quite difficult to operate. So I wouldn't go there alone. And again, we -- as we said, we are looking for something to give us lessons rather than something to just go on a big bang in produce. We tried it in a Macau, we didn't succeed, gladly so because I think the check was too big, and we accept that. So Zambia, I think, is an attractive jurisdiction. Again, it does have prospects for assets that can produce between 50,000 and 100,000 and feeds some of our investment criterias. So our team is continuously looking. So it would be more around I can say side that, but that's all the copper anyway. Therefore, that could be quite big. But I think if you play that around Zambia, let me say that again, Zambia, [indiscernible], I think you're not far off that. We are not going there alone. And we're not going to spend the mining where we own 100% because it's a world we need less on [indiscernible] and not a lot of money to spend on something we don't know yet to take it up to value care. So I think it's opportunistic, and we're not desperate for it. We have 3 good pillars that we want to see value by j2030. I hope that helps. But yes, I've operated there. And it is possible, I've come out and and enjoyed there. But I think when I think of investors' money, I have a head for my investors.

Thank you. We have no further questions online. And I think our questions here as well, we do not have. And then Brian come in to the pre close. But thank you so much.

Thank you again. Thanks, everybody, for the Capital Markets Day. We look forward to seeing you again some time. And it's really great that we have had the opportunity to spend a day with you in 5 years on. So Riaan can touch on the Capital Markets Day, and then we would come to a close in good time.

Okay. Thanks very much. I'm not going to take too much time on the FD pre close. I think the document was published is on sense. Perhaps just a couple of highlights, again, I think on the safety front, going very well. So up until the end of May, last time injury frequency rate [indiscernible] sitting at 0.03. So it's even better than the 2025 performance. So a very commendable performance. Then if we look at prices, the Richards Bay API4 price. So we expect that the average price for the first 6 months will be about $105 per tonne compared to $92 per tonne for the first half of 2025. Manganese also higher. So we expect [ 437 ] manganese that the price will be $4.73 for the 6 months, CIF China compared to $4.07 in the first half of 2025. Then I think 2 things that we must just point out. So remember, the -- if we look at the first half of 2025, the average [indiscernible] dollar was sitting at ZAR 18.38 to per dollar. It's now sitting at ZAR 16.40. So it's almost a ZAR 2 swing in the rand-dollar exchange rate, which obviously will have an impact on your export sales. And then the other one is also on diesel. The diesel price, the average for the year is going to be much higher than 2025. If you look at the diesel price from the first of January up until now, the diesel price is almost 70% up. So it has got an impact on the operational cost of the mine. But not only the operational cost of the mine, remember, even if we do a calculation to evacuate coal via truck, that is also something that we need to take into account when we look at exports. I think if we look at the production forecast, so the production forecast compared to the first half of 2025 about 8% higher that we foresee. And remember also, we had the adverse weather conditions the first half of last year that we didn't have again this year. So definitely a higher production at critical look, the first 6 months of this year. But lower production at Leeuwpan in line with the optimization project that we put in place. Also on metallurgical coal production, you will see higher metallurgical coal production. And this is also supported by improved export demand. So remember some of the coal that we can't now sell to the metals market anymore is now earmarked for exports. Then also the ramp-up of Matla actually going very well. Normally, the production and sales are the same. So you can see on forecast it's about 3.8 million tonnes for the first 6 months on Matla. So if you look at the -- on the sales side compared to the first half of 2025, there's an uplift of about supported by, as you can see in our forecast, higher exports. We also almost see a flat position at [indiscernible] on [indiscernible] and Medupi because as a result of the Unit 4 coming on board, there's more offtake from Medupi. But we did have -- there are problems at Matimba stacking and reclaiming. So we think those 2 will almost balance out. metallurgical sales, as I pointed out, lower due to the problems at ArcelorMittal as well as the ferrochrome smelteres. But as I pointed out, some of that coal is now going through exports that we then get us to the higher export numbers. On CapEx side, I think we did cover the CapEx, mainly due to the fleet replacement at Criteo, then if we look at the full guidance for the full year, the guidance that we gave in March is still appropriate. So production and sales between 39.4 to 42.8 for the full year and export sales between 4.3 million to 8 million tonnes. And as I pointed out, we just going to do about almost 4 million tonnes for the first 6 months of this year. Then we did touch on the performance RBCT, about a 7% improvement. So on an annualized basis, up until January to May, TFR is performing at just over 60 million tonnes per annum through RBCT. Then the next one on wind. You'll recall we gave you a bit higher guidance in March. Of course, that assumes that the acquisition of the [indiscernible] energy assets would have been completed. The [indiscernible] wind farm and also the Cision wind farm. So at this point in time, we're still waiting for certain of the conditions president to be fulfilled. So at the moment, the guidance that we give you is the generation for the year of 830 to 860 gigawatt hour includes only our own operations as well as the leh solar project. So I think that that's very broad, Anda. We're happy to take questions if there's any detailed questions.

Thank you So much I think we can go straight into the -- if there are any questions on the pre-close, we can take those. I do have a question online. And this question is what is the all-in logistics cost premium per tonne, including trucking, third party siding, handling and related costs and the breakeven net back on [indiscernible] being moved via Pomalaa multimodal route rather than directly rate and to reach the top end of the 7.3 million to 8 million tonnes export guidance. What second half 2026 tariff rate run rate do you need versus the current 3 to 4 trains per week. [indiscernible] the question is from [indiscernible] from Optimum Investment Group.

So obviously, we almost achieved 4 million tonnes in the first 6 months of the year. So I assume if they continue with that, the run rate we should be able to get to the 8 million tonnes for the full year. I mean if you see a substantial increase, obviously, then you can perhaps move more through RBCT, but to the cost to move the [indiscernible] or the other coal through multimodal depends on various -- firstly, it's the location of the operation. It's the quality of coal that you also move. But we did point out in the past that to move it via road could be 2, 2.5x more expensive than moving it through RBCT and the added complication that we have now is also the diesel costs. So to move it to a central location on the road, there's also now a higher diesel cost that we need to take into account. So if it was not for higher diesel costs, then it would have been easier than you can use multimodal exactly.

And then [indiscernible], you have a question.

Two questions from my side. Just looking ahead to the second half of the year. Can you just comment on, I guess, the market dynamics of the seaborne market? Were you sort of seeing demand from each countries? And that's, I guess, the level of tightness of the seaborne market, just given the, I guess, elevated cost base that everybody is facing. And then the second question, against being transit improving rail capacity? How should we think about the second half for the [indiscernible] specifically because there seems to still be constant and sort of the actions that Exxaro to help improve that specific part of the rail for the remainder of the year?

Anda?

I think -- is the FDs 3 close. But the seaborne market, as you would have seen in the last few months given the Iran and U.S. issues, I think continuously highlight to us how important call ease and that it remains a lifeline in times of uncertainty and we saw the coal prices go up, I think, of $130 a ton. They've now come down. And every time I wanted to say something a bit every time there is an announcement, whether the deal has been brokered or not the energy prices change. And what we are seeing now with the prospect that we are saying, what we're seeing today and maybe in the last -- I don't know what has happened in the last 4 hours. But what we're seeing after this morning was the fact that there's there's a prospect of ceasefire and resolve, which has now brought our coal prices to somewhere around $105, $106 a tonne, thanks [indiscernible]. So I think -- unfortunately, I think this volatility will continue until there is some level of certainty of what's happening in the Middle East, and we continue to see that volatility. It's helpful on coal, but it's not helpful on diesel. And I think that's why I said earlier on that what we saw during the Russia, Ukraine was no impact -- not as much on our diesel, but it was fantastic on coal prices. But right now, we're not seeing that benefit because the diesel prices are quite high. So what do we see going forward? We do see some stability because I think the marginal cost of production in this country, particularly where we compete, is possibly somewhere around the $90, $96 a tonne. So we think that there may be a flow price momentarily. But because sometimes you have over demand, sometimes you have the deficits, it's likely that we saw it dropping to below $80 a tonne last year and we don't know where. But I think the underlying dynamic or supply-demand tension, possibly should maintain this number around higher than what we are seeing today. [indiscernible] second question was around the Transnet

Transnet and GG? Yes, there is continual pressure around how we can get that right. So we are well wired with different levels of engagements with Transnet in order to get GG at the maximum. We still think the scope for operational improvements and efficiencies, improving cycle times of those trains without excessive and additional investment. We can operate better. And we think we can be prioritized more and we are putting pressure to exactly do that. Prioritize more, I think we are seeing 3, 4, 5 trains a week -- a day. We want more -- and I think -- that a week, is that right? and we want more. I think our expectation is somewhere not of 8 up to 11, and we should be getting that and we deserve it. So we are not making -- we are not -- we are not shy to call on what we think we rightfully deserve. And we still think we want more. We want to see more improvement and we think that cycle times alone and better operational management can deliver what we are expecting in the short term. In the long term, I think the study that we told you that we now have, we believe that from that study in the public sector participation and our involvement in some train operating companies that have the competence to run logistics should give us even the longer-term optionality we expect GG to embed. Okay. I think 04;00 is coming.

It's [indiscernible] and I don't think we have any further questions. We don't have questions online. And ladies and gentlemen, this brings us to the end of our Capital Markets Day. And on behalf of Exxaro, we would really like to thank you for coming to join us and to hear what the horizon has for us and our company. And thank you so much, and you have come to the end of our meeting. Thank you.