Metro Mining Limited (MMI) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. It's a pleasure to welcome you to the Metro Mining 2025 AGM. For those that don't know me, I'm Doug Ritchie and I'm the Chair of the company. You'll note that there's a little live stream up there. This has been broadcast as well to people who have been unable to attend the meeting. The meeting today is on the lands of the Turrbal and the Yuggera people, and we would acknowledge them as traditional owners. And also, in particular, the Ankamuthi People, the traditional owners of Seven Hills where the Skardon River where the mine is situated. I've been advised by our Company Secretary that we have a quorum of members, and hence I declare this meeting open. Just a couple of brief housekeeping matters. First, if you could, as usual, turn off all your mobile phones to silent, please? And secondly, in the event of an emergency, and we are required to evacuate the building, please proceed out those doors to the right down the stairs to the street and then the assembly area is in the corner of our store terrace and Cousins Street. I think you know most of the directors, but there's a couple of new ones, but I'd like to introduce the Board. Firstly, Simon Wensley, the Managing Director. Then Andrew Lloyd, who is also Chair of the ESG Committee. Next is Jo-Anne Scarini, who is the Chair of the Audit and Risk Committee. And finally, the Honorable Paul Lucas, the Chair of the Remuneration and Nominations Committees. Both Jo-Anne and Paul have joined us during the year, and hence, we'll be -- 1 of the resolutions will be confirmation of their elections. We also have some of the Metro team here, including our executive leadership team. Robin Bates sitting here, is the Company's Secretary and General Counsel; Nathan Quinlin, the CFO of the company; Gary Battensby, who is the Senior Site Executive up on site; Cherie Everett, who is the People and Culture, General Manager; Vincenzo De Falco, who is the General Manager of Marine Operations; and Matt Graham, the General Manager, Technical projects. Also, we have with this both Matthew Taylor and Steven Robb from our auditors, Ernst & Young, if you've got any particular questions you'd like to ask them. And Lewis Brimelow and Sam Swartz, the representatives from Computershare, share registry. With regard to the conduct of this meeting, I'll begin by providing a short address to you, and then Simon will provide an update on the company's operations. And then we'll move on to the fun part of the meeting where we go through each of the formal resolutions. Time will be allocated for questions on each of the resolutions and at the end of the meeting for any other business that anybody would like to raise. So if you could keep your questions until then. Thank you. So 2024 was an exciting and very positive year for Metro. Through the hard work and dedication of our people, Metro significantly built on its achievements in 2023, to advance our core strategy of being the world's lowest cost fuel bauxite producer. New capacity commissioning, ramp up, economics of scale, and market conditions combined to deliver record margins. A significant milestone for Metro was the completion of its $36 million expansion project during the second quarter of 2024. And this was completed by additional spend on our assets by our contract partners, Transhipment Services Australia, and Blake Machinery Group, to take the total spend to well over $50 million. The expanded capacity derives from new haulage or fleet, upgraded loading capacity at the both the pit and the port, and a new high-capacity wobbler screening circuit, 2 additional tugs, and significantly the commissioning of our Offshore Floating Terminal, Ikamba. Delivery of this expanded capacity enabled Metro during quarter 4 of last year to consistently operate at a project target rate of 7 million wet metric tons per annum. This culminated in total ship production of 5.7 million wet metric tons, a 24% year-on-year increase. Consequently, production and shipment guidance for 2025 has been set at 6.5 million to 7 million wet metric tons. Metro's balance sheet was also a key focus in 2024, an equity raise with institutional and retail investors for $45 million was completed in May, $39 million of junior debt was repaid during the year. And in November 2024, Metro completed a refinance of its senior debt and private royalty held by Nebari entities, achieving a lower interest rate on borrowed funds and increased borrowing capacity. The dedication of Simon and his management team in delivering these very important initiatives and a favorable price environment contributed to a 30% year-on-year revenue increase to $307 million. Site EBITDA margins improved to $13.80 per wet metric ton, and $174 in quarter 3 and quarter 4, respectively -- $17.4 that you read, sorry. Underlying annual EBITDA to $37 million. As a result, a significant outcome for shareholders was the increase in Metro's market capitalization, up 300% and to $364 million by year-end. The Board is extremely proud that Metro's improved financial performance was matched by our ongoing commitment to deliver shareholder value through the execution of our operations in a safe environmentally responsible and socially accountable manner. Pleasingly, last year, Metro significantly reduced the number of environmental incidents on site and published our ESG strategy and road map, which details our broader sustainability initiatives. The company also received national recognition of 1 of our rehabilitation projects, winning the association of Mining and Exploration Companies 2024 National Environmental Award for the work associated with the restoration of the old kaolin mine at Bauxite Hills. Health, safety and well-being remained a core focus of the company with an elevated focus on critical risks and high potential incidents. This diligence and focus resulted in a marked reduction in high potential incident frequency rate at the mine from 22.8 in 2023 to 11.4 in 2024. 2 audits of the Ikamba Safety Management System and an independent safety audit of our transhipment operations were also commissioned during the year to verify the safety of our operations right throughout the value chain. We continued to work collaboratively with our stakeholder communities and we're particularly proud of the progress that we've made through our reflect reconciliation action plan and are excited to have begun preparatory work on our innovative reconciliation plan. This year was, however, not without its challenges. Periods of inclement weather continued to cause some disruption, while global economic uncertainty was also the cause for concern and will likely increase in 2025. The speed of regulatory change remains unabated with the company currently focused on ensuring that we are ready for the implementation of the Australian Sustainability Reporting Standards. Before passing over to Simon, I wanted to provide shareholders with some additional information in respect of the one-off management performance incentive that the Board approved for implementation in December last year and Metro's remuneration framework. With respect to remuneration, the Board commissioned an external review of the total entire structure for the executive leadership team in late 2024, which identified that the current rem packages were generally in some cases, significantly below market benchmarks. The review also highlighted that Metro operates at a higher level of complexity than many of its peer companies and that this needs to be considered in greater detail within the rem framework. In response to these findings, the Board commissioned a redesign of the rem framework in order to ensure that it was fit for purpose, and is competitive with its peers, helps to retain critical talent and the outcome of the review will be implemented later this year. But to address the current retention risk and taking account of those above factors that I've mentioned and taking further advice from external consultants, the Board also decided to implement the management MPI, but not only Simon and the executive leadership team but for other key roles across the business with its design to have both a reward component for effort, as well as a retention element. The Board is confident that Simon and his team have the expertise and perseverance to meet the challenges head on and to further grow and mature the company. To that end, Simon in his presentation will detail Metro's first capital management policy and outline some strategic directions and principle for growth in his presentation. On behalf of the Board, I would like particularly to thank Simon and his team for their tireless efforts last year. It was very challenging, but it was a very rewarding year. And I think we're all looking forward to a very successful 2025. I'd also like to thank our stakeholders and our shareholders for the continued support of the company. Simon, could I pass over for a business update. Thank you.

Thanks, Doug. So I'll point you to the usual disclosures here. If you could take those into account, please. So firstly, again, to emphasize our acknowledgment of country. There's some beautiful pictures here of the country in which we work up at the Skardon River, quite an inspiring area. And so we really do acknowledge and thank the Ankamuthi People. We acknowledge the Elders past, present and emerging on that land. And we also pay respects generally to all the Aboriginal and Torres Strait Islander Peoples throughout Australia. So Doug has touched on a number of these factors. And I would also point you to the excellent annual report that we put together and -- particularly as the architect of that. [indiscernible] That's been growing at about 9% combined for the last, sort of, 5 years, something [indiscernible] our 14% growth individually within that. The first quarter of this year has also been another record. So we're continuing that trade. So traded bauxite is definitely continuing to be -- to grow strongly. And so we're seeing probably a likely another sort of 55 million tonnes of additional bauxite demand over the next sort of 8 or so years. And then we're seeing sort of -- even though on that previous slide, you saw alumina prices come down. You've seen the bauxite price come down, but it hasn't come down by anywhere near as much from a percentage point of view as the alumina price. So there's definitely been a sticking point in the alumina -- in the bauxite price, and so I'll cover that a bit more in the cost curve slide. So -- and that's being driven by supply constraints. So disputes in West Africa and particularly in Guinea are really contributing to supply uncertainty in this market. And so that is a continuing something that started a couple of years ago and now there was a big impact last year with EGA's GAC mine being suspended and now in the last week or so, a further 3 mines have been suspended, which is about 50 million -- sorry, 40 million tonnes of additional capacity that is currently being suspended by the Guinea government. So that's -- if you put that in perspective, that's almost all of Rio Tinto's total production being suspended. So look, these licenses have been revoked. There's definitely a big power play coming on. There will be elections in Guinea at the end of this year. So you can just imagine, I guess, the volatility in this environment in Guinea over the next sort of at least another 9 months as we get towards those elections, et cetera, et cetera. So we're already seeing what was -- this declining the Guinea price I saw yesterday popped back up over the last few days after having been sort of declining for the last few weeks. So there's definitely going to be a response -- and it's going to be a response to that. Metro has about 6.9 million tonnes of formal contracts. There's some flex and options in those. I've already mentioned that our current pricing, which is pretty minor, it's been a bit of -- I've had a few questions about Q2 pricing. All of that is fixed. The volume is what we can produce. So we're targeting about 1.8-plus million tonnes this quarter. All the pricing for that has been accounted for all of our refineries that we're supplying are operating at the moment. So from that point of view, we're really now looking for July onwards as to what the pricing is going to look like. So the cost curve, we've seen this before, and I've put a couple of extra markers on there just to kind of talk about, I guess, quantify, I think, some of the things that we've been talking about. So this cost curve has been steepening. You can see the projected cost curve for next year, which I think may also be underdone, frankly, given the costs that have increased in Guinea. A lot of the new capacity has been coming on, on the right-hand side of that curve. They are much further from the coast, 200 to 300 kilometers away from the coast. Transshipping costs have almost doubled over the last few years as constraints in the river, barging and trend shipping have occurred. And now, of course, you've got the natural evolution of Guinea's regulatory system will be taxes and royalties being put on to those companies that do survive the purge in terms of -- and there's been a bit of bad behavior in Guinea in terms of the mining side of things, not everybody, but you've seen transfer pricing, you've seen probably underpayment of workforces, you've seen dodging of royalties and fees, et cetera. So there's a bit of payback here in terms of the way the Guinea mining sector, the Guinea, certainly, the bauxite sector has been operated over the last few years. Then I've sort of put in place, I guess, where the bottom of the cost curve is, and that's about USD 30 per tonne and these are all delivered China costs. And so the whole, I guess, strategy around where Metro is, is that we are targeting that bottom of the cost curve. So the difference between $65, which is a Guinea price, so normally, in cost curve terms, you'd expect the long-run price to be set at about the 90th percentile of the cost curve. So round about that USD 65 per tonne for Guinea. And so it will of course bounce around that, but that's generally accepted practice in bulk commodities where you see the price gets set. So if that's what the Guinea price is, if you factor in a discount for quality, et cetera, we should be targeting at the bottom of the cost curve around USD 20 per tonne margin. So that's what this cost curve tells us about the future of this business. If we can target and get to that USD 30 per tonne delivered with all of the quality and other sort of discounts that occur in these contracts, then what that tells us is that margin for someone at the bottom of the cost curve can be around USD 20 per ton on average, right? So you take that and convert that into Aussie dollars and let you do the math, that's where Metro is targeting our financials and our output. Okay. So are we going to get there? That's a good question, right? So we're going to get to $30 a tonne. So look, I think when we talk about Guinea, the new place is coming on 200k, 300k from the port. Metro is 9, okay? When we talk about the sort of the economies of scale that we've got here, the Guinea transshipping distance is roughly 50 kilometers, roughly, port to our -- ours is about depending on which anchorage we're using 10, 12, something like that. So this is a very different physical position. Our bauxite is high grade. It's high alumina. It does obviously have silica, which causes some of the penalties, but it's a very acceptable product in the marketplace. We've done a lot of work over the last couple of years on market positioning. We've got a very simple flow sheet. I said no washing. We don't wash the bauxite. So our costs can be low, and we now are heading to that 7 million tonne economy of scale position. So when I first looked at Metro, and I still believe it today, we have all the prerequisites here of a very, very successful bulk commodity operation. And look, if you look at what we've done, I want to talk a little bit about strategy here over the next sort of 3 or 4 years. It doesn't take long for investors and analysts and everybody to start saying, "Okay, well, what's next?" But I just want to emphasize sort of what we're doing, what we've been doing and why we've been doing it. And we come back to that. We've fundamentally come back to trying to add value to this business and a lot of derisking. So we've recapitalized the business several times from a pretty desperate situation in 2021. A lot of new team and a turnaround in that operation. So again, my hats off to the whole team who is sitting here who've really executed on that turnaround. We've really had to reposition our product. We've had to test the boundaries of that quality trade-off, what's the price impact of moving our position. We've now reset all of our contracts to -- towards the reserve grade of our product. So that's an accepted product in the market. That's the price on the basis on which we're negotiating prices today and what we've been doing for this last quarter. So the prices that you see flowing through will reflect all of that in the numbers to come. We've really derisked and increased control over our supply chain all the way through to the customer, increased the resilience of our operation. A key part of our strategy, a really key part of our strategy has been about driving resilience in the business, right, about weather -- particularly around weather, et cetera. And then we fast tracked this expansion. And so I guess I do admit that we were a little bit late off the mark last year in that expansion. But I will also point to the fact that we have really been pushing and pushing and pushing this expansion. We could see the market moving, and we did not want to wait. And so we've been pushing this probably faster than might otherwise have been the case. So look, that's -- you can see the growth in volumes in sales and production to a target of that sort of 6.5% to 7% for this year and sort of a minimum margin for us this year based on a cost focus. Now let's talk a bit about, I guess, the first time Doug touched on this about capital allocation. The first key message here is that the first 2 columns here around about -- there's plenty more to do at our Bauxite Hills mine. This is our core asset. It's our core business. There is a lot to do here in terms of adding value. That business alone, we're looking to try and generate over $300 million of cash available for allocation, net of debt, et cetera, over the next 5 years. So that is the ability -- that underpins a business that has a net asset value of greater than AUD 1 billion, okay? So from a Bauxite Hills perspective, we are seeking to -- and of course, we're trying to be a little bit conservative here, but it's difficult not to see these sorts of numbers flowing through based upon the rate that we're moving. Obviously, that means we should be net debt, we should be net cash this year from a cash perspective, our amortization on our debt sees us repaying all of that anyway under the current scheduled by the end -- by March 2027. And one thing we're doing is starting exploration again this year. So we're looking to try and maintain and increase our reserve life through this period. The organic growth comes from initially a creep factor. Our current flow sheet with a few tweaks and additions, we think can do about 8 million tonnes per annum. So that's where we're focused on for 2026. And we are basically working on investigating the material handling benefits and beneficiation that provides additional value over and above our current reserve to be able to kind of -- to access that. And so we're taking a bit of a different perspective on beneficiation. We did a conceptual piece of work last year -- sorry, 2 years ago, on that. That was a traditional Rio Tinto sort of big bang approach. We're now looking at a more modular, flexible mobile approach that we can bring in a lot earlier and a lot faster to kind of help valorize the resources that sit outside the reserves. So here's the sort of next years, the micro of next year, what does that mean for those 2 elements? So obviously, being lean and safe, but we're -- next year, we should be at or around that USD 30 per tonne delivered into the market. A resilient asset and business model, the wet season. So I mean, just for instance, over the last couple of weeks, we've had some pretty severe wins. The TSA Garden, the floating crane has had to park itself up on a mooring, but [indiscernible] has been regularly delivering over 20,000 tonnes even in very difficult wave conditions over the last couple of weeks. So there's a validation there around that resilience that we've been putting in place. We talked a bit about that product and market positioning. We're going to further drive that, leveraging the logistics supply chain, working on that debottlenecking strategy and going into exploration. So -- and we've done a bit -- quite a bit of work on Calin over the last 12 months. We now have done some customer test work. We've done some logistics testing. We know what that looks like. It's something that is now a real opportunity for us going forward. We're not going to be pursuing that in the very near term based on where the current bauxite prices are at, but it's definitely there for us. So these are the focuses for next year. And in particular, I guess there's one of these things that the resilience provides us is the possibility to make Q1 not a cash negative quarter, which it has been in the past. So we're definitely focusing on trying to make that a cash positive outcome. So the third column here then is, okay, well, what are we looking to try and do over and above that to add value to you as shareholders and to our business. Well, we will be focusing, as I said, that core -- most of the effort is based on the core business. But if we're going to grow, and we're going to take that $1 billion plus business into a $2 billion or $3 billion -- sorry, $1 billion business into a $2 billion or $3 billion business, then we also have to look at growth opportunities and about leveraging core competencies that we have in our business. So we've set some initial targets for that, looking for definitely IRRs above 20%. And I'll talk a bit about the inorganic growth strategy in a second about setting a firm limit on what we're going to deploy in areas which we appear -- which we say are non -- not core to our bauxite in Australia business. All of that added together means that we are going to commit to moving into capital allocation in 2026. So at least 20% of our available free cash flow after debt servicing will be distributed in dividends. And we will also be looking at opportunistic share buyback programs as soon as we are able. So let's cover a bit more about that growth. So core competencies require -- when we reflect on our business, obviously, we've developed a bauxite mining business in Cape York. What does that really mean in terms of what we're good at. And I think when we look at those things, transshipping, project development, value-added marketing, asset turnaround, logistics and supply chain, those are all, I think, really go to the core of what our team can deliver and have delivered over the last 5 years. And within that, we've obviously done that within the challenge of a remote -- very remote operation and also done it whilst punching above our weight in regional and community impact. So this is something that we feel is a really important part of what we do, and I think it's something that underpins, I guess, the security of supply that we've got in a location like Skardon River, and it's something we can really build on. And that's all contained within what has been a pretty stable management team, and it's something we've been adding to that over the last couple of years to bring the skills in that we need. And I'm really confident that this team has all of that capability to be able to deliver on this. So let's talk a bit about these organic opportunities. So look, we talked a bit about earning the right. That capital management framework is about earning -- placing a framework around our business that we're going to commit to. Obviously, outside of Bauxite Hills, our firm focus is going to be a bauxite. So how do we find additional bauxite mines that we can access, that we can add value to, that we can bring to bear. But -- and obviously, within playing at home, if you go to the bottom left-hand box there is about what you might call your home base. Cape York or Australia. But -- and the products that we have in our -- on our lease at the moment, our bauxite and Calin identified -- but how do we play that? And we have to sort of really recognize the fact that there aren't that many bauxite projects around the world and aren't that many in Australia -- and there are a few more around the world. But when you look at them, they're in a jurisdiction risk -- that is a big jump from where we are at the moment. So if you think about West Africa or you think about Vietnam or Las or whatever, then some of these opportunities in bauxite are not an easy step away from where we are at the moment. So we've just got to recognize that fact. And that's why we need another dimension to this. And I think that's why the core competency piece is so important is that how do we leverage our core competencies maybe into something that's adjacent to what we're doing at the moment. So when I think about bulk minerals, I think about high-quality minerals like silica or I think about industrial minerals or maybe phosphate rock or whatever it is that might be out there. How can we deploy our skills in developing and running a bulk mining operation, which adds value and how can we deploy some of these things like marketing about logistics, et cetera, et cetera, and that have a high quality and scalable resource like we've got at our Bauxite Hills. So how can we replicate that model moving forward? So look, obviously, the focus is at home, as I said. But if we are going to play away, we're going to place a firm limit on what we're going to deploy there to about 20% of market cap. We're going to try and seek high-quality partners where we can to be able to do that. We'll seek low cash flows -- low-risk cash flows within that model. So management fees may be working on the transshipping parts of the business, et cetera, those are lower risk parts of the supply chain where you've got fungible assets that are mobile. And if worse comes to worst, you can demobilize those sorts of things. So how do we -- there's definitely an approach about how we might want to work in these different parts of the -- when you might be playing away from home, if you like. But we can't wait for that. And I think this doesn't happen overnight. I've been involved in business development, all of my career as have many of the Board. And you can't just switch a switch and suddenly do BD. You've got to actually get your processes in place. There's a lot of shoe leather that gets worn out in going around, talking to people accessing opportunities, doing the analysis, getting the rigor in place, going through the -- you're kissing the frog sort of processor, right? So there's a lot of that work involved. It doesn't happen overnight. And we've got to just start ramping up in that space, and that's what we're going to do this year. And that pipeline that comes out of that it's -- that's the richness in the opportunities to choose what we want to do. So developing that pipeline of opportunities, being able to choose the right ones that fit what we want to do is a very, very important part of that process. So that discipline, that rigor, the application of our capability into the right place is all part and parcel of that approach. Okay. Look, a quick focus then for 2025. So back to this year, I mean it's all about execution. We know that. We're going to continue to mature our safety culture and particularly through the marine operation, which we've taken a large amount of responsibility in that marine organization. We've had a lot of help from our partners and also from the regulators in developing that. So we thank them for that. That's going to be a continual focus. We've got to fully leverage now the money we've spent over the last -- in the first quarter of this year, particularly around that large loading facility, and we're seeing them really good signs straightaway that, that work has been -- that work has been very useful for us in terms of getting increased throughput and reliability. We need to leverage the vast international experience of our new transshipment partner, ABL, and I'll acknowledge Bill Bisset, who's the CEO of -- the new CEO of TSA. TSA is being purchased by a huge transshipping -- global transshipping company called Asian Bulk logistics and Bill is the new CEO that's been put in place there. He's got huge experience in transshipping and in the marine industry generally. And so we're really looking to leverage that relationship, Bill, this year to enhance particularly around the tuck-on barge productivity to service the transshippers. We've spent a lot of time on mine planning and quality control, and I'll touch on that again in a minute as I will on the use of technology to improve our productivity and supply chain effectiveness. Look, one example on the safety side is the use of AI now in safety and in hazard identification and those sorts of things. We've already had the Guardian system in our trucks for quite some time. That affects -- that allows us to pick up when a driver is starting to feel sleepy and maybe as microsleeps and these cameras or software behind these cameras now picks up these very sort of small changes in movement and behavior. And that's also happening on our marine vessels, and we were able to -- one of the things that ABL can bring to us is the experience of using what they call captain's eye, which is an AI-based sort of detection system around offshore marine vessels where you can pick up even outside, where there's no smoke sensors, you can pick up smoke and fire. You can see when there might be water leaking. You can even, for example, when a human is there and doesn't move for 2 minutes you can actually pick up and say, okay, there's something wrong with this person, let's go and do a formal check on that person. So these are the sorts of things that we can now do with the new technology that comes in here. Just onsite as well, and I'll -- Matt Graham, who's come in from Anglo last year and is the GM of technology and projects, really going to be focused on using effective fit-for-purpose technology on our site to be able to improve not only the safety side, but the productivity side. So working with Gary and his team and Vincenzo and his team across the board in terms of how we do that. So for example, GPS guidance, et cetera, improving the quality of how we mine from a quality point of view. We already have a sort of -- it's not XRF, but I never couldn't quite get the -- this basically an online scanning technology across our bauxite that picks up the quality of the bauxite live real time on that conveyor belt. And we've spent just almost $700,000 over the last wet season to improve our sample station that picks up physical samples. So that was one -- and that's a really good example of where one of our older pieces of kit had -- wasn't coping well with the new throughput, and we've had to go back and look at some of that older -- those older pieces of equipment and upgrade them to suit the 7 million tonne or 8 million tonne rate that we're targeting. So that's now being put in place. And we've also got a new on-site laboratory which we've revamped and that's coming into play. And then look, a couple of other areas we've been working on one of our most difficult planning exercises, both from a day-to-day, week-to-week, month-to-month, year-to-year is the barge planning side of things, how many barges do we need, when do they go out? When are the tides coming up and down? So we've got a new planning software that's helping us to optimize that barge planning, load rates, et cetera, et cetera. and that's being implemented as we speak. We've also, as Doug said, for the first time come out with an ESG framework and strategy. It's really got 3 areas. We've got the sustainable mine and supply chain. So that's our -- what are we doing today and tomorrow around the physical flow sheet. We've got then what impact do we have as a company from a regional perspective, how do we ensure our activities, our community and workforce aligned. And then a third element, which we call future proofing, so this is about making sure that we are pursuing long-term strategies that are kind of aware or registering the fact that regulations change, both here and abroad, for example, whether it's in China to do with our quality or to do with our upstream reporting could be in the shipping space, could even be -- could be the regulatory environment in Australia around what's going on. So how do we align our strategy and positioning to ensure that we can still deliver on the mine and supply chain and the future and the regional impact. So look, I'd say that ESG -- a sound practice here is about strengthening our business. That is the core -- that's the reason we're doing this and for no other reason. And that's got a positive impact across not only -- I think we all want to work for a company that's got those values. I mean, I think that, obviously, our suppliers, our customers want to work with a company that's got these values. So I think it's really important from a culture point of view that we do that. It's very important to our traditional owners that they see this right at the top of our agenda in terms of managing the land that we are temporarily occupying for this operation. It's a thoughtful structure. We're building and leveraging on the good work that we've already done. We've never really kind of, I guess, brought it all together in one way, but we've been doing a lot of good work so far. I think it gives us sort of focus and clarity in terms of our impact with the community, blends the current activities with a proactive approach in terms of what's coming through. And look, our current focus areas are all win-win opportunities for us and particularly around water, fuel efficiency. Fuel's one of our biggest costs, how do we reduce our fuel usage, and that's an active discussion within the mining site. We've got a new diesel electric loader that we're trialing, which is going superbly well. So thanks to BMG for providing that. And it's a live conversation with ABL around tugs, how do we kind of improve fuel usage on our tugboats. Cyber resilience and improving reporting against our standards, obviously, are clear ones. But -- and I want to talk a bit more about employment readiness and particularly around our local community members and females. In the annual report, you'll see some stats there on how much, I guess, impact we're having on some of the local communities. Some of the background to that is some of these other stats in terms of over -- not sure 90% of our workforce, roughly 4 and 5 North Queensland. So 486 workers all coming from that far North Queensland area. So the impact that we're having here is initially through our workforce, but with all of these other programs. So Metro, so that's all of the contractors and -- so on -- I mean, our own Metro salaries alone are worth about $23 million that go back into that FNQ community. And we're very pleased to say that we're still tracking above the 30% target that we agreed with our indigenous communities to have those Aboriginal and Torres Strait Islander Peoples in our team. And that doesn't happen by accident. This is not a sort of kind of throw up the card, see where they land. And suddenly, you've got that level of employment. There's a lot of hard work and a lot of things that we do. Nothing super revolutionary, but it's the combination of about 4 or 5 factors that give us this multigenerational. We've got workers in their 60s and workers in their teams from these communities right the way through, and that's from things like our training and development program, apprentice roles. It's about flying there. That's one of our new service providers, Torres Strait Air. We're flying small planes into these communities on a regular basis. So if you -- we basically say to a worker, if you're from far North Queensland, we will go and pick you up, right? So if you live in Horn Island or if you live in Bamaga or if you live in Mapoon or you live in Weipa, if you live in far North Queensland, we'll find a way to come and get you and bring you to the site. Now that's obviously got a cost. But the benefit that we see coming through here is tremendous. So that's the approach we take rather than going, "Well, look, you've just got to meet, you've got to be in Cairns Airport by 8:00 on every Monday. That's not how we're approaching this. One of the things I'm also really pleased about is some of our female sort of engagement, and we've -- it's hard in a FIFO environment in any case, particularly with the sort of negativity that's been around some of the FIFO side of things in Australia in the last few years. And I'm glad to see the mining industry as a whole engaging in some of those issues and addressing them. And we're trying to do our own thing. We have a pretty small camp. We want to make it as safe as possible for every member of that community. I'm glad to say we've had no incidents in that space. So look, we're really happy with that. And then to bring through female participation, we've really enjoyed working with the NPA college on the Johnathan Thurston Lead like a girl program. It's about trying to give high school students that confidence around engaging in -- having the confidence around being workforce ready, being able to express themselves about how they can participate in a company or in a job later on and get that experience. So we're the only sponsor of that. It's been a tremendous first year for us last year, and we're going to continue with that sponsorship. So look, there's a whole bunch of different things here, and it's not one thing that's revolutionary, but a whole bunch of things that, I think, add up to a sort of driving that very high level of engagement we've got and the employment levels. Okay. I think that's -- yes, that's basically it. So thank you very much for listening. Sorry, that probably took a bit longer than you were planning, Robin.

Thanks, Simon. I hope that gave you a very good and detailed flavor of what has been taking place and really where the focus is for us going forward. So thank you, Simon. And now I'm going to sort of change the tone a little bit, and we're going to just go through all the formal resolutions. So the formal notice of meeting dated the 22nd of April 2025 has been released to the ASX and dispatched to all shareholders, and I'll take the notice therefore, as read. In accordance with the company's constitution and as set out in the Notice of Meeting, we have determined that voting on each of the resolutions will be conducted by a poll. The results of the poll will be declared and released to the ASX as soon as the results are counted by Computershare and available. Only shareholders present, persons holding valid proxies and validly appointed corporate representatives are eligible to ask questions and vote at this meeting. If a shareholder has appointed a proxy but is present at the meeting, the proxy holder is not entitled to ask questions or vote. Only shareholders who are entitled to vote on a resolution may cast a vote on that resolution. Shareholders who are entitled to vote can cast a vote using the voting card that they would have received upon validating their registration. As Chair of the meeting and as detailed in the notice of meeting, I will vote where authorized all undirected proxies in favor of each resolution. The attendance register is at the entry to this room. You will all have registered and received a voting card upon entry if you are entitled to vote. And if you have any questions, please see Robin, the Company Secretary. You would have been given an attendance card when you registered. If you have a blue voting card, you're a voting shareholder, proxy holder or corporate rep, and have chosen to vote using a paper voting card. You're also entitled to speak at this meeting. If you have a yellow card, you are a nonvoting shareholder. And whilst you're entitled to ask questions and make comments, you are not entitled to vote at this meeting. If you have a white card, you're a visitor and are not entitled to speak or vote at the meeting. I'd like to inform the attendees that the proxy votes for approximately 36% of the shares on issue. And I thank you for your vote. A further breakdown of the proxies will be detailed prior to the voting for each resolution. The first item of business is to receive and consider the financial statements for 2024. In this regard and in accordance with the Corporations Act and the Metro Mining Constitution, I table for discussion, the financial statements, the directors' report and the auditor's report for the financial year ended December 31 2024. Are there any questions in respect of the audited financial statements? Hold your card up.

Is there any solution to the foreign exchange loss problem?

Yes. So thank you very much for your question on the foreign exchange. It's naturally, as you all would have seen with significant volatility in the financial markets, a pretty key area of focus for us. So I guess just as a little bit of background in how we manage our foreign currency is as an exporter, naturally, our receipts are in USD. So the first thing that we'll attempt to accomplish is to reduce that exposure in as natural and organic a way as possible. That will generally require or have us seek to -- have as many outgoings in U.S. dollars as possible to reduce that net exposure. Then what we're left with is essentially then what we need to hedge. So for example, I think this year, we've guided the market to an expectation of around $200 million of net exposure. And that is essentially then what we've gone in hedge. In terms of the unrealized loss that you would have seen in the financial results last year, that was unsurprising for us given our hedging positions. And the average rate at which those hedging positions were initially entered into. And that relative to the closing price at that balance day. So given the difference between those 2 rates, it was quite a significant quantum, albeit unrealized paper loss. So from that perspective, what you're seeing there is actually the results of our hedging that's in place, right? So that's the volatility that we've essentially managed at that point. I'm pleased to say that subsequent to that balance sheet date, what we've been able to achieve is a restructure in our currency hedging book at this point. We've been able to fortunately take advantage of some of the volatility that you have seen in the financial market to do our best to time our restructure well. And so -- whereas what we had before was about $50 million of net hedging at around $0.68. We've been able to restructure that into, I think, approximately $200 million at roughly $0.0635. So if you looked at the foreign exchange rate today at about $0.645, that essentially means our entire hedge book for the moment as of today is essentially in the money. So we're fairly pleased with that result.

I also note Matt Taylor from EY is here. So are there any questions in respect of the auditor's report? Okay. On that basis, I'll turn to the resolutions to be put through the meeting. Resolution 1, the adoption of the rem report. The first resolution is an ordinary resolution and relates to the adoption of the remuneration report. The resolution is put to members under Section 250R(2) of the Corporations Act. The resolution is advisory only and does not bind the directors or the company. The resolution reads that the rem report for the financial year ended 31st of December 2024, be adopted. As you may know from the meeting materials, there is a voting exclusion, which specifically applies to this resolution, excluding the votes of directors, management and their families and related entities. Are there any questions in relation to Resolution 1? The proxies received are set out on the screen. I note that all discretionary proxies have been directed in favor of the resolution. Based on the proxy votes received, the resolution should be carried. Please now indicate For, Against or Abstain next to the Resolution 1 on your voting card. Voting cards will be collected at the end of the formal part of this meeting, and the final results declared after the meeting having regard to any vote cast here. [Voting]

As the next resolution relates to me, could Andy please take on the role of Chair?

Thank you, Doug, and good afternoon, everybody. Resolution 2 is an ordinary resolution and reads as follows: that Mr. Douglas Ritchie, who retires by rotation in accordance with Rule 38.1A and 38.6 of the metro's constitution and the ASX Listing Rule 14.4 and being eligible will be -- to be reelected as a Director of Metro. Are there any questions in relation to Resolution 2? Thank you. The proxies received are set out on the screen. Based on the proxy votes received, the resolution should be carried. Please now indicate For, Against or Abstain next to Resolution 2 on your voting card. [Voting]

Thank you. I now hand the meeting back to Doug.

Thanks, Andy, and thank you to shareholders. Resolution 3 is the reelection of Andrew Lloyd as a Director, it's an ordinary resolution and reads as follows: that Mr. Andrew Lloyd, who retires by rotation in accordance with Rule 38.1C of Metro's constitution and being eligible, be reelected as a Director of Metro. Are there any questions in relation to Resolution 3? Thank you. The proxies received are set out on the screen based on the proxy votes received. The resolution should be carried. Please now indicate For, Against or Abstain next to Resolution 3 on your voting card. [Voting]

Thank you. Resolution 4 is an ordinary resolution and reads as follows: that Ms. Jo-Anne Scarini, who retires in accordance with Rules 36.2 and 38.1(b) of Metro's constitution and Listing Rule 14.4 and being eligible, be elected a Director of Metro. As this is Jo-Anne's first meeting, I thought it might be nice if she just gave a short address to the shareholders.

Thanks, Doug. I'm Jo-Anne Scarini, and it's nice to be here with you today. I joined the Metro Mining Board in late October '24, and I've loved having the opportunity to get a little bit of red dirt on my boots again. Through my career, preferring to live and work in remote environments, I found that I gravitated towards working in and leading operations. This allowed me to develop strengths across a very broad range of disciplines that I've found highly relevant in the Metro boardroom. I've had the good fortune to work in senior roles in 2 multinational resource companies. And amongst other work, I have successfully led several significant and complex operations across the commodities of bauxite, thermal coal and manganese. My work in bauxite was leading Rio Tinto's Weipa Bauxite operation. And I have spent 10 years of my career in on or leading that operation. The leadership experience that I gained in the latter part of my career was built on a very solid governance, commercial and systems base having spent the first part -- best part of the first half of my career in accounting or accounting related roles. That background, the accounting background as well as having spent quite a lot of time applying risk frameworks to operations to ensure that optimum outcomes were achieved has been very helpful in taking on the Chair role for the Metro's Audit and Risk Committee. I've really enjoyed being part of the Metro Board, and I have developed deep respect for my Board colleagues. I believe that my background is very complementary to the background of the other members of the Board. And I've also really enjoyed working with the executive team. And I think Simon has assembled a really strong, capable and committed group of people who are doing some remarkable things. So I was very impressed when I went and had a look at Metro's operations and very impressed looking at just the very, very dedicated commitment to perpetually improving the outcomes from the operation. Today, I seek your support to continue in a Non-Executive Director for Metro Mining. Thank you.

Thanks, Jo-Anne. That was very useful. Any questions from the floor? The proxies received are set out on the screen. And based on the proxy votes received, the resolution should be carried. Please now indicate For, Against or Abstain next to Resolution 4 on your voting card. [Voting]

Thank you. The next resolution is an ordinary resolution and reads as follows: that Mr. Paul Lucas, who retires in accordance with rules 36.2 and 38.1(b) of Metro's constitution and Listing Rule 14.4 and being eligible, be elected as a Director of Metro. And similarly, this is Paul's first AGM with Metro. And I'd just like -- if he would like to address the meeting briefly.

Thanks, Doug, and thank you, everybody. It's great to be here today. I'm before you today for your consideration of my appointment as a director, I'm also Chair of the Remuneration and Nominations Committee. I'm a practicing lawyer and an urban planner by profession and a fellow of the Institute of Company Directors. I've shared or served on boards in the private sector and at all 3 levels of government and nonprofit in aviation, energy, rail, water, university and indigenous native title, particularly in the mining area, relevantly to a business that has many international trading partners, I have also run training -- I also run training in governance and public policy courses for DFAT in the Asia Pacific area, particularly in Indonesia, a country that I love. I'm also a State President of the Australian Institute of International Affairs. I was a State Minister for 11 years, mainly in the infrastructure sector, and I'm very familiar with the workings of government and the public sector bureaucracies in what is a highly regulated sector. In relation to mining specifically, my experience, of course, is in Queensland, both involved in as a regulator, but also dealing with mining companies at various levels, but involved with organizations in both South Australia and Western Australia in bulk commodity -- touching mining companies in bulk commodity mining. My journey with Metro Mining started like you in early 2022, as a modest shareholder. And I -- when the share price was not what it is like now. And I followed the journey of Metro Mining, a journey that has been due to the hard work and efforts of Doug and the Board, and Simon and a wonderful team, and our team of staff, and it just doesn't happen, it's that hard work. And when you get on site, though, at the end of a wet season and there's more threatening and it happened and in an area where monsoons and cyclones are routine, you do get an appreciation of the complexity of it, not just being another mine, the hauling, the screening, the shipping and the loading into barges, the shipping barges out, be loading a vessel, then moving the vessel further around, then of course dealing with a market where there are quite -- there are enormous trade uncertainties now, and we don't need to canvass those as you're all aware of them into a market where it is not a generic product and different bauxite smelters take different bauxite and the enormous work that's had to go in from Simon and his team in improving those contracts in markets is second to none. So you see the value of a management team and a Board that worked together cooperatively that actually don't play gotches that actually are prepared to canvass all of the issues. And it is a Board that I'm very proud to say or pleased to say, is as good as any Board that I've ever observed and far better than the vast majority of them in the way that it works and corporates together. I'm honored by the opportunity to put myself before you for reappointment to the Board, and I look forward to working together to be part of the team to guide the company to a prosperous and responsible future.

Thank you, Paul. I think that's quite informative. Now are there any questions in relation to this resolution? Okay. The proxies are set out on the screen and based on the proxy votes received, the resolution should be carried. Please now indicate For, Against or Abstain next to Resolution 5 on your voting card. [Voting]

The next resolution again relates to me. Could Andy please take the Chair?

Thank you, Doug. Resolution 6 is the grant of performance rights to Mr. Douglas Ritchie, and reads as follows: that for the purposes of Listing Rule 10.11 and for all our purposes, the grant of 2,666,000 performance rights to Mr. Doug Ritchie or his nominee in lieu of his directors' fees and otherwise on the terms and conditions described in the explanatory memorandum, be approved. Are there any questions in relation to Resolution 6? Thank you. The proxies received are set out on the screen. Based on the proxy votes received, the resolution should be carried. Please now indicate For, Against or Abstain next to Resolution 6 on your voting card. [Voting]

Thank you. I'll now hand the meeting back to Doug.

Thanks, Andy. The next resolution is an ordinary resolution, and it reads that for the purposes of Listing Rule 10.11 and for all other purposes, the grant of 417,269 performance rights to Mr. Andrew Lloyd or his nominee in lieu of 25% of his directors' fees and otherwise on the terms and conditions described in the explanatory memorandum, be approved. Are there any questions in relation to Resolution 7? The proxies received are set out on the screen. Based on the proxy votes received, the resolution should be carried. Please now indicate For, Against or Abstain next to Resolution 7 on your voting card. [Voting]

The next Resolution #8 is an ordinary resolution, and it reads as follows: that for the purposes of Listing Rule 10.11 and for all other purposes, the grant of 222,543 performance rights to Mr. Paul Lucas or his nominee in lieu of 20% of his directors' fees and otherwise on the terms and conditions described in the explanatory memorandum be approved. Are there any questions in relation to Resolution 8? The proxies received are as set out on the screen. Based upon the proxy votes received, the resolution should be carried. Please now indicate For, Against or Abstain next to Resolution 8 on your voting card. [Voting]

Resolution 9, the grant of performance rights to Simon Wensley. 2024 management performance incentive, MPI, 2025 short-term STI and the 2025 to 2027 long-term incentive plans. This Resolution 9 is an ordinary resolution and says -- and reads that: for the purposes of Listing Rule, 10.14 and for all other purposes, the grant of the following performance rights to Mr. Wensley or his nominee under the company's employee incentive scheme titled 2020 Employee Incentive Plan or otherwise on the terms and conditions described in the explanatory memorandum be approved. And that slide does designate the 3 types of incentive plans. Are there any questions in relation to Resolution 9? Proxies received are as set out on the screen. Based upon the proxy votes received the resolution should be carried. Please now indicate For, Against or Abstain next to Resolution 9 on your voting card. [Voting]

Resolution 10 is an ordinary resolution that reads as follows: that for the purposes of Rule 39.5(b) of Metro's constitution and Listing Rule 10.17 and for all other purposes, the maximum aggregate amount of the directors' fees that may be paid to the company's nonexecutive directors per annum as remuneration for their services be increased by $300,000 from $500,000 per annum to $800,000 per annum. Are there any questions in relation to Resolution 10? The proxies received are as set out on the screen. Based upon the proxy votes received, the resolution should be carried. Please now indicate For, Against or Abstain next to resolution 10 on your voting card. [Voting]

You'd be pleased to know that Resolution 11 is the last resolution. It's an ordinary resolution and reads that for the purposes of Listing Rule 7.2, exception 13, and for all other purposes, the company be authorized to issue equity securities pursuant to the company's employee incentive scheme titled 2022 Employee Incentive Plan, the details of which are set out in the explanatory memorandum as an exception to Listing Rule 7.1. Are there any questions in relation to Resolution 11? The proxies received are as set out on the screen. Based upon the proxy votes received, the resolution should be carried. Please now indicate For, Against or Abstain next to Resolution 11 on your voting card. [Voting]

As that is the last of the resolutions, a member of Computershare will now move around the room and collect your voting cards, and the result will be announced to the ASX as soon as possible after the meeting. Ladies and gentlemen, that concludes the formal items of today's Annual General Meeting. Is there any other business that a member wishes to bring before the meeting? There being no other business -- sorry, I didn't see. I missed it, sorry.

I just got a couple of questions, I think, more for Simon. But am I right in thinking the legacy contracts wash out this year?

Yes, pretty much. That's the plan. It's probably going to be back ended a little bit. So it will be increasing the percentage of sales will probably be slightly higher in the second half versus the current quarter. So if we -- I mean, if we're hitting close to our top 8, if we hit our target around $6.97 million, then they should all wash out this year.

Two other quick ones. Just -- and it might be more for Vincenzo. But when we get surprised by like [indiscernible] weather than we expect, it seems as though demurrage is almost inevitable. Do we have any way of being more agile on that? And then I'll give Nathan one to think about. But it would seem as though we are still not going to pay tax for a while. And so rather than paying dividends, maybe the focus ought to be on share buyback.

Yes. On the weather events I think it's more of the management of the backlog of it because the weather events cannot be handled as it is, but it's more how you manage the backlog of it or the consequence of it. And in terms of supply chain and transshipment capacity, we have that sprint capacity to be able to recover in the next coming days, what has been lost in the previous one. So to, let's say, hedge the demurrage exposure does these days in the future. That's the -- and so it's how you do is adding enough capacity outside there to have that sprint capacity to recover. That's how you manage.

Yes. I'll just comment on the demurrage as well, if I may, is that, one of the things from a shipping schedule perspective that we will do is we will assume a small level of demurrage as essentially cost of the shipping schedule, right? So as part of that, as you can imagine, from a -- in terms of a general Capesize vessel contract, generally, you'd be looking at demurrage of between sort of USD 20,000, USD 30,000 per day, which is not a small amount, but really what we're trying to manage is not having any shipping schedule gaps. So what you will do is you will err on the side of having a little bit of overlap between your vessels and actually incurring some demurrage. As Vincenzo says, it's more about how do you address the concertina effect that often happens when you've got a weather delay. And so that's something that we'll keep working through with our shipping partners to stay as agile as possible, and particularly with our longer-run relationships with some of our shipping partners where we have long-term contracts of affreightment, that's a little bit easier to achieve to get that flexibility. So that's something that we're going to continue to prioritize as part of our shipping relationships is how do we respond to those sorts of situations where we have limited control over them, but will happen at some point during the year. So that's sort of more of the demurrage side. I absolutely agree with your point from a tax perspective. As we currently model things, we wouldn't expect to be paying tax probably until 2027. And a lot of that is driven by naturally the pricing environment. So with pricing the way it currently is, we're expecting to probably pay tax a bit earlier than what we were expecting maybe a year or 2 ago, which is actually a fantastic thing in some respects. But from your perspective, I agree entirely is there's going to be the right balance from a tax efficiency and optimization perspective to see serious value and opportunistic share buybacks. So I think it forms part of the sort of broad balanced capital allocation, where there's probably merit in all of them. It's just at what level and at what quantum.

[indiscernible].

I assume you're referring to the carry forward tax losses from tax. Yes, absolutely. So I think at the end of the balance sheet, period. I think we had approximately in gross terms around $250 million of carryforward tax losses. So naturally, what we will do is a process, and it's generally a process you'll do every 6 months where you'll assess what is the likelihood around the recoverability of those tax losses. So as you can imagine, with some of the metrics we've been talking about and some of the cash generation we've been talking about, that's clearly something that we need to look at in time for the next balance date is -- and there's -- is essentially a modeling exercise around expectation of utilization of those carryforward tax losses particularly from almost a rule of thumb sort of within the next 5 years is generally the sort of time frame that you would look at. But yes, I think the time is right to definitely have a fresh look at potentially the re-recognition of those deferred tax assets.

[indiscernible].

Absolutely agree completely.

Other questions for any of us, please.

Just then on a triple note. Shaw and Partners, the big resource focusing stockbroking company recommends MMI as a strong buy.

Yes. That's good, isn't it? You can see why.

Yes, just more of a comment. I don't know about anyone else, but I'll be looking forward to my nice dividend in 2026.

That's a positive note, too. So if there's no other questions, we'll close the meeting at whatever it is 12:33 PM. Thank you, everyone. Now I think we've got tea, coffee, cakes and biscuits outside if you'd like to join us and maybe ask a few more informal questions outside the meeting. Thank you very much, everyone, for your attendance.