Orica Limited (ORI) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. Welcome to Orica's 2022 Investor Day. It has been some time since we had the last one. So I'm so pleased to have you in the room here today and those on the webcast. Before we start, let's just go through some legal issues, I'd like you all to study the disclaimer and then repeat it. But please take a minute to read it, and we'll start from there. Thank you. For those who I haven't met, I'm Delphine Cassidy, Chief Communications Officer. I've been with Orica 7 years, and I'm pleased to be here today. But I'd like to start with the acknowledgment of the Gadigal -- sorry, acknowledge the Gadigal of the Euro nation, the traditional custodians of this land and pay my respects to the elders past, present and emerging. We do appreciate that you've taken the time to join us today. And for those who joined us on the webcast, welcome. But before we start, as part of our safety procedures, I'd like to take you through the emergency procedure. If we have to evacuate, you will hear the whoop whoop tone. All of you are quite familiar with that. On hearing this tone, please move to the exits at the back. The Fullerton staff will then guide us to our meeting place, which is at the Fenton on Martin Place. Investor Day is your day. In planning for this day, we've asked a few of years into what you'd like to hear from us today. It came down to 3 things. The first thing was to meet and great executive team. We've got some in the room today and some virtually. That's the world that we live in today, but we've made -- we've done our best to get everyone in the room. The second one was to go through our verticals, which is the platform of our refreshed strategy and get to understand that more. And the final one was that how do we measure success and what are the growth opportunities for Orica going forward? Hopefully, by the end of today's briefing, we give you an insight in all those objectives and you walk away knowing something more about Orica. We structured today's program around our 4 verticals. So it's the core mining vertical, quarry and construction, digital solutions and mining chemicals. We'll also touch on manufacturing and supply, sustainability and our financial priorities. In the room today, we've got our Australian-based executive team, except for Germán Morales, who is now in isolation, but he will join us on Zoom. So we've got here Christopher Davis, Sanjeev Gandhi, Angus Melbourne and Leah Barlow in the room, and we'll have all the others on Zoom. We'll have plenty of time for Q&As after each section. And the management team in the room and online will be there to answer your questions. We'll take questions from the floor. There are some microphones around the place. So please check a moment for the microphone to come to you and ask the questions that those on the line can hear you. For those online, we've set up a slider facility. There's a QR code that you can scan and you can ask your question through the QR code. And for those in the room too, we've put the QR code on your table, so you can use that facility as well as the microphone facility. In light of time, we'll start with the questions that are most operated in the facility. You can operate a question if there's something similar that you'd like to ask, someone's already asked that, please just operate that and we'll start with the highest and move down. So I do encourage those in Melbourne to have a cup of tea with a management team during the break and then have some lunch with us after that. And for those attending our Kurri Kurri site visit tomorrow, can you please just get in touch with [indiscernible] at the back desk and she'll give you the instructions for tomorrow. With that, I'll hand over to Sanjeev to start the day. Thank you.

Thank you, Delphine. A very warm welcome to all of you. It's great to see a lot of familiar faces here. I was hoping we'd get more in, but logistics is not easy, even getting from Melbourne to Sydney can be a challenge, and obviously, COVID is still with us. So we've had a few last-minute dropouts, but this means we have more people online virtually, which is great. We have the technology and the tools to manage this. As Delphine said, this is -- it's long overdue. We in fact, planned a similar event last year, but obviously because of known reasons, we could not go ahead and do it. So I'm glad we managed to find a virtual and smart way of doing it today. Today, it's all about all of you getting to know the management team of Orica, I mean, you see Chris, Delphine, and myself all the time. So we are the same boring old faces. So you'll see the rest of the team today. And I think that's great. So they're all very excited. They've been preparing quite hard for this. Some of them since you know that we had a new refreshed management team as of April last year. They're doing this for the first time. So do bear with us in case we are not smart enough to answer every question you put up, but we'll do our best. I promise you that. So that's the opportunity today. We'll also talk a little bit about our thought process behind that strategy, which we rolled out in November. And maybe give you a bit more granularity, we'll not be able to tell you everything so far because we are still constrained by, as I've been telling a lot of you, our systems in terms of numbers and everything else, we are getting there, but we are not yet ready today, but -- this will obviously lead eventually to giving you a lot more granularity by business vertical as Delphine talked about it. Tomorrow is again going to be very exciting for all of you who can go visit our technical center at Kurri Kurri, there it's all about touch and feel. I was telling Angus, our CTO. I said no slides, no posters, no PowerPoint. If you cannot demonstrate, don't talk about it. So I'm hoping that he'll get you excited. I would have loved to be there, but we have limited room there because of safety reasons and everything else. So I decided to opt out so that more of you can participate. So I'll leave you in the very capable hands of Angus we'll get you to leave your phones outside because obviously, what we'll show you is for your eyes only. You can obviously talk about it, but no pictures, please. And I think you understand that. Let me start by focusing on the -- very briefly on the first slide that Delphine talked about our values. The values did not change. These are the values we have in place since 2015. I still very strongly believe in them. And we did refresh our strategy and focus, but we kept those values very much alive because they are so relevant today. Safety, extremely important subject for us. We are in a dangerous business, right? And we do everything we can every day to keep our team safe, our operations safe, our customers safe, but it's again, a reminder to all of us that we are in a dangerous business and complacency can be very tricky here. So it's front and center of everything we do. And I keep encouraging the 13,000-plus Orica family that if you see something happening which you feel uncomfortable with, which is not safe, you put tools down, you stop operating, and you raise your hands, and I and the management team are fully behind this. We do not encourage any kinds of unsafe operations, and we'll do everything we can to keep our communities around us and everybody else is safe. So that's extremely important. A quick update on Russia, a safe exit out of Russia is very important for us as we told you at the half that we are in the process of exiting the business in a smooth and undisruptive safe manner. And I feel comfortable that by September when we come up with our November results, we'll be able to give you a lot more clarity on that. It's still work in progress. And as you can imagine, we have to deal with regulators here in Russia, it's difficult. You cannot go into the country. So it's not straightforward, but we have a clear path, and we'll keep you updated here. Moving on, just a quick reminder of our strategy, something we shared with you in November, our purpose to sustainably mobilize the earth resources. It becomes even more relevant today in an environment where we are living in a very, very disruptive world. We have COVID, we still have a lot of geopolitics happening. We have energy disruption happening all over the world. We have inflation coming in. So there's every kind of challenge here that all organizations and all businesses globally face. So it's very important for us that we double down on the strategy. We don't get distracted. We focus on what's within our control and influence, and it's all about delivery. So that's what the team focuses on every day, and we do everything we can to not let our customers down. And I'm pretty pleased to say that we've been making good progress, and there will be obviously more over the period of time, days, weeks, months and years where we'll continue to update you on the strategy. We'll talk a little bit about how we will win today. So each of the regional business heads. The presidents will talk about ideas like optimize operations. We talk about partnerships for success. And then we'll talk about, obviously, on the right of that slide on the 4 verticals. So we'll give you a bit more insight on our thinking on coring income, construction, mining chemicals, technology tomorrow, it's all about technology, but Angus will already set up today and then obviously, our core mining and blasting services. Moving on. This is just a view that the industry has on global material move. So we obviously can -- we monitor a lot of different sources, and we try to put together a cohesive heat map of major commodities that our customers are active in and which have an obvious direct impact on our business. So that's a summary of various different sources. This is all published information. And then we have put in an Orica view on this. And this was basically the starting point for the strategy when we said there is the opportunity, right? And what are we going to focus on over the next 5, 10, 15, 20 years, what's the future of this industry. And this gives you a pretty good view. I mean gold being countercyclical as a safe haven, and we've been leading service provider to that industry. Obviously, we benefit from the fact that it gets more and more difficult to extract gold ore. So this means there's more demand for our products and services and especially for mining chemicals. So it's a very successful business for Orica, and we continue to invest in gold copper. We are the largest service provider to the top 10 copper mines in the world. It's a very, very important part of our portfolio. It's growing very successfully. And even though there has been some slackening of those peak copper prices, copper is fundamental enabler of the energy transition of the world, and we are very well placed here to take advantage of this and support our customers. My view on thermal coal has not changed that we will see over this period of time until 2026 peak thermal coal production. Obviously, the energy disruption, the energy market volatility has pushed that out. So coal will have a longer run. But eventually, the coal production will stabilize and then start to shrink. So the base case business plan that we had in our strategy assumed peak production by 2026. This might get pushed out. It all depends on what happens with the energy markets and the pace of transition. So coal is one of those few where we've already recognized that there's going to be a plateauing and then there's going to be an eventual decline. And then obviously, Q&C, that's another business coring construction tunneling, which I always visualize as countercyclical because the global economies start to reduce activity, then governments start to spend on infra, which has a direct impact on Q&C and tunneling. So that's a -- it's a very good business to have. It grows quite strongly as you see that. and we'd like to do more there because there's clear opportunity. And then obviously, met coal and iron ore, it's once again very closely linked to global GDP and despite whatever China does in terms of managing their own demand, I think there's good potential for that business, and we continue to grow that. And then in the end, it's the future-facing commodities like I talked about copper, but then it's the rest. It's lithium, nickel, copper, cobalt, manganese, going into e-mobility, going into battery storage and a lot of those products are also going into energy transmission. So very exciting. And we are looking into opportunities everywhere because this is a business that will grow very strongly in our portfolio going forward. So it's a pretty good picture. It's a positive picture in terms of the macros for our customers and their commodity exposure. And as you can imagine, being the global leader, yes, we will directly benefit out of those positive macros going forward. Moving on. That's just a snapshot of our current business portfolio. That's the same as for March last year. You see that our top exposures to copper, gold, Q&C, thermal coal, and it's a pretty good spread. Also regionally, we are very well positioned and also in terms of our product offerings with our emulsions being the largest contributor to our top line, we have a pretty -- quite a strong diversified portfolio of products and services for our customers. Moving on. Global reach. I cannot stress how critical and how important this has been to the success of Orica managing all these disruptions over the last 18 months. Given the fact we have this fantastic footprint of manufacturing sites, assets, offices, people on the ground in more than 100 countries. We have been able to mobilize at very short notice products and services from one part of the world to the other. We've managed to move our raw material sourcing away from Russia without disrupting our customers, and that's all been possible because of this fantastic global network that we've had. So we continue to leverage this. We continue to optimize interregional flows. We are -- and we haven't talk about it. We're talking -- we're developing a hub-and-spoke model for the regions to make them self-sufficient so that we take cost out of the supply chain because inflation is obviously a constant headwind in everybody's business today. And there's a lot more we can do in terms of generating value out of this fantastic global footprint. So this is a true competitive advantage of Orica, and we'll continue to build on this. You'll hear examples of us expanding our footprint in emerging markets like in Africa, in Asia, where there's clear opportunities. So we'll continue to leverage of this fantastic asset that Orica has built over the last 148 years. And then finally, clearly, on the left, our focus, I talked about safety, extremely important for us. the strategies in place. The focus is right now on execution. Everything we do every day is all about executing the strategy, continue to invest in technology, very, very important for us and ensure that we do everything we can to deliver profitable growth for Orica and for our shareholders. And then obviously, hopefully, with the strategy working well, we having some tailwind, the macros in our favor, we will be able to deliver shareholder value. I feel pretty comfortable where we are today. And the guidance we gave you for the full year -- full financial year has not changed, so we are well on track. And obviously, November, we'll come back with the financials, and let's then talk about 2023. With that, thank you all, and Delphine, back to you.

Thank you, Sanjeev. Now as we turn to our 4 verticals, I'd like to share a video with you showcasing our approach to innovation and technology. In the mining vertical, we are combining our market-leading blasting technologies with advanced digital and automation solutions to revolutionize operations of the future. A key technology that's enabling this change is WebGen, the world's first truly wireless through the earth initiation technology. With the support of our customers and the tireless efforts of our technical specialists around the world, we've successfully now hired our 100,000 WebGen prime across more than 3,000 blasts. As adoption continues to increase rapidly, we're now using WebGen across 6 continents, in 6 unique industries, but more importantly, having developed 7 revolutionary mining methods, we are enabling our customers to think and mine differently. We believe this technology is a real game changer for the mining industry. I'll let you have a look at a video. Thank you. [Presentation]

Good morning, German, you're ready to go.

Thank you, Delphine, and good morning to all in Melbourne, Sydney, joining us on webcast. For those who didn't meet at the last Investor Day, we joined Orica about 4 years ago during the Latin America region and then moved to Melbourne about a year ago to lead the APA region. Prior to that, I spent 18 years in this industry, having worked in Europe, Africa, Americas and Australia. Given the growth opportunities in Asia, we have split the region into Pacific and Asia. I'm going to start to this presentation talking about the complete APA region. I will then go into some details on Australia Pacific and Adam Hall will talk to you about Asia. So turning on to Slide 15, where I'll give you an overview of the APA region. Australia, Pacific and Asia continue to be attractive markets for Orica, contributing 39% of sales and 67% of total EBIT. We are proud to be operating in a range of countries across APA and to positively contribute to those communities in which we work. Orica serves as a verse group of customers across all major commodity segments in the region. As noticeable is our position in coal in both Indonesia and Eastern Australia. Gold representing about 16% of our sales and a growing position in copper at 14%, up from 12.5% last year. We also continue to make good progress in diversifying the business across metal, quarry and construction and digital. Interesting years as we continue to service the thermal coal transition. We delivered value to our customers through a holistic value proposition, expanding the complete portfolio of products, services and technologies, including mining chemicals. Elevated commodity prices, a strong mining activity in the region and tight global supply chain of ammonia, among others, has driven high demand for our products. This increased demand, coupled with commercial discipline, enabling improved pricing across all categories and subregions. However, the region is not shifted from the many challenges that the world is facing. Other than the well-known impacts of labor shortages, COVID, inflation or supply chain I should highlight the adverse weather in Queensland and New South Wales resulted in a temporary halt of customer operations in the first half of this financial year. So let's look now into Australia Pacific region in a bit more detail on Slide 16. The Australia Pacific region is focused to continue growing over the next 5 years with material move volumes expanding at 1.4% per annum. Ongoing growth is expected in all commodity segments, except thermal coal. Future-facing commodities, including copper, are forecast to demonstrate the fastest growth in the medium term. This includes copper in Papua New Guinea and Australia, Nickel in Australia and New Caledonia, and lithium in Australia. Thermal coal is the only commodity. We don't see any growth in the mid-to-long term. Despite record high prices, Australia has not been able to grow thermal coal exports above the peak -- COVID peak. While some improvement in exports can be expected in the coming years, it is likely to be offset in the midterm by declining domestic coal consumption as energy transition in Australia accelerates. In terms of the overall volume of material move, still making commodities are forecast to drive continued growth, as global seaborne metallurgical coal and iron ore market expand. While in iron ore, this is driven by committed projects, additional capital expenditure will be required to support metallurgical coal growth opportunities. We are operating in a volatile markets with significant change impacting our customers. We have seen unprecedented iron ore and coal prices in recent months, global energy security concerns and other geopolitical factors are impacting commodity demand. And as previously mentioned, renewable and clean energy markets are expected to drive significant growth in future phasing commodities such as lithium, nickel and copper. And finally, COVID, the tight label market and supply chain constraints continue to challenge our customers. Big changes are influencing customer needs and expectations from key suppliers such as Orica. Security and flexibility in supply is even more critical than ever due to the price volatility and events such as La Nina. Technology and automation solutions and either to drive productivity and safety improvements, and customers are demanding the suppliers step up ambitious ESG commitments. But the solution is not one size fits all. We are and we'll continue to unlock qualify our customers through tailor solutions for each segment and indeed each customer. So over the next 2 slides, I will expand the first 2 elements, security of supply and technology, starting with security of supply on Slide 17. Orica offers unmatched security supplier across the Australia Pacific region. We have 3 ammonium nitrate manufacturing facilities. It's strategically located to Southwest metal and gold customers in the East as well as iron ore customers in the Pilbara. Additionally, we have a long-term third-party contract to supply ammonium nitrate to our Southwest metal customers. [indiscernible] completed the conversion of AN field in the first half of this year. This universal drill is enabling us to better service our clients as well as other Orica regions for melting AN is required. This outstanding ammonium nitrate footprint is complemented by a network of bulk emulsion plants in the East and West domestic infusion systems and electronic detonator assembly. In Helidon, packaged emulsion manufacturer Kalgoorlie and booster manufacture in an exclusive domestic partnership. Finally, a safe, efficient and effective deployment of our products and solutions is supported by a strong and committed group of professionals across the region, including a wide technical service presence and our technical center at Kurri Kurri that some of you will be visiting tomorrow. This privileged industrial footprint plus dozens of sites and people across Australia Pacific, set us apart from many other industry players. Moving now to technology on Slide 18. So vision security and supply, Orica is delivering value through our ESG and technology proposition. High commodity prices, level shortages, productivity or safety and some of the elements that underpin technology option. Customers are responding to Orica's digital offering with a strong momentum in OrePro3D, design for outcome of fragmentation systems. Our digital offering is helping customers to optimize blasting and capture downstream benefits. We are very well placed for growth in 4D and WebGen. As reported, we have had very successful poly trials in customer sites, and we have just signed [indiscernible]. We also have a mature pipeline for underground WebGen application with 5 new sites in fiscal '22, and we are looking forward to the release of working 200 as we see significant value for our open cut customers. Orica's advanced vibration management fuel and noise control reduction solutions and supporting our customers who license to operate in the respective communities. And finally, and in addition to helping customers to deliver on their ESG commitments, we are delivering on our own initiatives such as nitrous oxide patent program. So moving now to Slide 19, which summarizes the AUSPAC priorities. In our region to be successful, we need particular focus on 3 areas. Firstly, we need to lead in sustainable solutions. And as such, we target to continue diversifying our business by growing metals quarry and construction and digital portfolio. We also commit to deliver on our net sale commitments, and I'm particularly proud to report that we have made significant progress on our Net Zero ambition, including the preparation for [indiscernible] Kooragang Island, develop prefeasibility for Yarwun and secure approval to generate carbon credits. And we have also established a collaboration path for green hydrogen and ammonia at both Kooragang Island and Yarwun. Secondly, we need to optimize our operations to further improve on security and flexibility of supply. Furthermore, we need to ensure we grow profitably and focus on commercial discipline, cash generation and technology option. And finally, we need to empower our people. We need to engage, attract and retain talent through coprocessor delivered on a compelling employee value proposition, in what is today a very dynamic and competitive market. So I will now hand over to Adam to give you an overview on Asia. Thank you.

Thanks very much, Germán. My name is Adam Hall. I'm the Group Executive and President for Asia and Chemicals. I've been with Orica 3 years initially in the Chief Development Officer role, but now taking on Asia here in Jakarta and also our chemical business, and you'll hear from me later on that. But for now, what is Orica Asia. We think of Orica Asia as 4 distinct subregions: Indonesia, rest of Asia, India and China. And we -- and that's in descending order of contribution to our earnings. Each of these has generally strong competitive intensity. They're complex regions, but they're exciting. Turning to Indonesia to start. In Indonesia, big exposure gold and copper as well as thermal coal. The trend we see there at the moment is for localization. Our competitors are building domestic manufacturing capacity, including a large AN facility coming on in about 24 months. And miners are seeking on top of that to really enhance their productivity that the level of engagement from Indonesian miners on comparing advanced solutions is high. They're receptive, they're engaging, they're pushing us to bring them the highest quality solutions, which is terrific. What's our position? We're seen as a technical leader. So our clients frequently rely on us for those -- for that reliability of supply and for those differentiated outcomes. Across the course of the next few years, we'll be absolutely focused on driving better solutions for the Indonesian miners often with a higher use of technology, including WebGen and 4D. Turning to the rest of Asia. And you can think of rest of Asia as sort of led by Philippines, Malaysia, Mongolia, and then a bunch of -- then we're also present in Hong Kong, and then the rest of Asia also served indirectly. Here, again, a dynamic region, lots of complex regulations. You may remember, for example, the Filipino gun ban, which prevents explosives moving around the country during elections. And that, of course, makes our role there harder, but proud to say that we're seeing as the leader there, for that region, the premier partner to clients as they drive productivity out of their minds. Something that's interesting on the horizon. With the recent change of regime in the Philippines, there's a number of megaprojects in the Philippines in gold and copper that we'll come to the 4 probably in the '25, '26 sort of time frame. And again, Orica, just in a great place to be able to drive the to partner with them and drive those projects. This region, gold and copper and Q&C. A lot of Q&C exposure here. And that's where, again, working with our partners. We have a strong presence. We're seeing very much as being the leader in Q&C across East Asia, and it's something we're pretty excited by. Turning to India. In India, key commodities, obviously, coal with Coal India, but also iron ore and other metals, and then Q&C. And one of the interesting trends in this market is quite intriguing. Simultaneously, there some people that use nonelectric debt. So the very initial basic debts, but also clients are demanding digitization. And I think Orica is really well positioned with our broad product suite to both move clients on the journey from comparably less sophisticated to more upscale detonators and detonator systems, as well as immediately starting to serve them on the digital track. One, you can see our position there is as a premium provider. We are used for -- and partner for technically demanding challenges. One thing you may not appreciate is that often those technically demanding challenges are Q&C based. So in a highly urban environment like India, being able to blast nearby population or respecting existing facilities that are already there. That's something that people come to Orica for, which is terrific. We'll be looking to increase share in India in a growing market. And again, based on driving customer productivity. Just to give you a sense of scale, several of our large customers not looking to grow by 10%, not looking to grow by 50%. They're looking to triple or quadruple output across the course of the next 5 years. And so partnering with them on that is an exciting opportunity. And that's in addition to the sort of $1 trillion-plus infrastructure spend that's coming in India across the next 5 years. Let me turn then to China. And of course, China in terms of the mining system, obviously, coal and iron ore, but also Q&C. And here, one of the interesting trends is the focus on safety. So the regulator looking to move the whole market from nonelectric debt to EBS, partly as a result of safety but also to get better reliability in the hands of the miner. Our role there in our JV with our partner is as a premium product supplier, where -- and the output from our facility is just terrific. Our customers across the country are looking for Waihi debts as being the most reliable debt, the ones that they can use when they've got a problem. So I think our opportunity there is to utilize this change in the market and see that as our opportunity to again grow market share as the market becomes more educated on the need for sophisticated products. Education for the long term, not educated, but rather appreciating those premium products. If I look across Asia as a whole, in terms of our economic exposure, it's probably about 55% gold and copper, another 25% thermal coal, another 10% Q&C and the rest split amongst the other commodities, including future facing. But what -- how are we placed, how are we going to serve these markets? And what you can see on the next page is our manufacturing and supply footprint. So let me draw your attention at the top of the page, you can see Gomia. You can see Limay. The ones that we didn't have time to put there or a space to put their Waihi, Yinan and our new facility in Samarinda. All of these facilities are manufacturing ISP initiating systems and package explosives for use across the region. It's a wonderful footprint. It gives us that reliability. And then in addition, of course, make AN at Bontang in Indonesia, which is it's just a terrific facility. It's around 10 years old. It's just hit its record production. We are pumping out as much and as we can to serve that Indonesian market. And that also allows us to serve reliability. But why, there's more. The logistics assets that we have are really critical. We have the cyanide sparge station that's just come online in Malaysia. You can see it marked there on the slide. In addition, we have a terrific facility at Subic Bay in the Philippines. Those of you who know Asian logistics will know Subic, one of the great ports of Asia, and it's terrific for us to have a facility there in order to be able to serve our clients. This is the hardware. This is the physical installation in addition that the software, the systems are our people. And our people are the ones that make this work every day, stitching together the supply of explosives and detonators across the region to again get our -- keep our clients running in all those different regions, all those different jurisdictions, complying with all the different regulations across the region. And I think we're delighted to have this scale that enables us to do that cost effectively for clients. So this is -- that's what we have as our footprint today, but where are we headed? And I think we're delighted with how responsive Asian clients have been to our newer products. So we -- I mentioned earlier that our clients are frequently coming to us for those digital solutions. For example, in India, sometimes we're digital first. We have clients that have come to us that bought BlastIQ and now they're looking to buy other things from us, including explosives, which is just terrific. Likewise, OREPro 3D has been just a repeated winner across Southeast Asia every time we've just been discussing with the client this strong interest. And of course, WebGen, we've launched a terrific ongoing campaign with a client around that. Our full commercialization. It started with safety. That was the initial discussion, but it has moved to productivity. And then, of course, 4D, open cuts starting this year, underground next year. I just want to draw your attention to that final point there. These products only become innovative solutions once we have -- once they're combined with that local team. It's our local leaders, not people at a desktop in Melbourne, but rather the local team who know that deposit, know the client that are able to make this worker solution. So a great example in Mongolia, draw bell blast that critical moment where a mine moves from development to production and delighted to say that our team there partnered with the client and was able to achieve a fantastic result safely for them, just a wonderful thing to be a part of and probably the beginning of many years to come in that relationship. And then also this focus on outcome-based contracts across the region, a half dozen today but growing in terms of places where we eat our own cooking, where Orica's rewards are tied to our performance under the contract, which is terrific. Maybe the last thing on this page to draw your attention, something that's different in Asia, again, the urban density in India and Philippines in particular. So the vibration products, AVM are just so welcomed by our clients there and an important part of our product suite. So we'll be looking to those to continue to enhance going forward. How are you going to see us develop over time, smarter solutions. Obviously, we've spoken about that optimized operations in terms of scale. In terms of partnering, unsurprising that we need diversity, we need inclusion to succeed. And customers also want to partner with us on our co-based contracts going forward. An important thing to mention, I've talked about partners in the past, we need to refine and co-invest for joint success. They need to succeed as well as us. And I think we enjoy a great suite of relationships across the region. That's how I come up Asia in a nutshell and look forward to your questions shortly. But in the meantime, over to another terrific region of LATAM and over to Brian Gillespie.

Thank you, Adam, and good morning to everyone in the room and those on the webcast. My name is Brian Gillespie, and I've been with Orica for 4 years. And before I led the LatAm region, I led the GroundProbe business for 3 years. My background, it was a little different to most people at Orica. Most of my career has been spent to consulting with Deloitte and PwC. But most recently, I spent 4 years to buy ports and also 4 years on the Board of Uniting Care Queensland, which is the largest not for profit in this field. Latin America may be the part of the world that most people on this call are familiar with. But Latin America is the central of the world's future-facing commodities. And Orica is the #1 explosives provider in LatAm. Recent years, high prices for gold, copper and iron ore have driven further investment and particularly expansion of existing projects here in the region. And the mining sector as a whole is forecast to grow at a very healthy 4% per year for the next 5 years. Orica's business in LatAm will continue to be focused on copper, gold and iron ore and also in the growing Q&C segment, particularly in Brazil. The competitive landscape hasn't changed that much over the last few years, but Orica's further consolidated the #1 position to the acquisition of Exsa in 2020, which has been a fantastic addition to the company and really given the scale in Peru, the largest growing market in Latin America. Orica doesn't manufacture ammonium nitrate in our region, as most of you know. And therefore, as a #1 provider, we've got a lot of challenges, but we're also the largest importer and the large spire of ammonium nitrate in the region. This actually gives us a lot of flexibility in choosing our supply sources and optimizing the overall supply chain. The skill and flexibility really served as well following the restrictions in Russian imports. And I believe that Orica alone, particularly in Peru and Colombia, we're able to supply contracted volumes to all our customer base. The biggest change in the region has been the effort that we put in to improve the quality of earnings by focusing on the EBIT margin and the trade working capital and not just the dollar value of our EBIT. Most of our customers in the region do value Orica's technology products and security of supply, of course, increasingly and also our service. But the reality is that we did have some customers who are price unfortunately only price seem to matter. Some of the contracts we inherited when we acquired the Exsa business in Peru also more EBIT margins. Over the last 12 months, we worked really hard to try and ensure that the customer base we have is prepared to pay for value we can generate and not just the is per kilogram of ammonium nitrate. Unfortunately, we've had to exit some contracts in Brazil, Peru and Chile. We've had to renegotiate others to make sure that all our remaining customers generate an acceptable margin. This is a change of philosophy. I personally believe we have a big enough contract portfolio to be a very successful business. without having to win new volumes and bidding wars. All our country managers now have permission to exit contracts or product lines where the customer doesn't see any value in our premium products, our expertise or increasing the security of supply. And this is supported by the group CEO, and it really doesn't empower our people in the front line to believe in the value of Orica and be prepared to work our way where we just can't generate acceptable returns for our business. As a result of the last 12 months' effort, we really do have a much healthier contract portfolio and also a stronger set of customer relationships. At the beginning of this financial year, the Latin American region created a new operating division, which we called Blast Engineering. We identified 140 technical specialists across the region that previously have been embedded in different parts of our business. These specialists have deep blasting expertise, typically graduates and/or post grades and we've put them all together in a single division, which has become the focal point for special blasting services and also the knowledge of all our new technology products because this product portfolio is growing. This division is led by [indiscernible], he's a mining engineer with an MBA from the University of Queensland. He previously worked for Vale and Rio Tinto in Australia and the U.S. And he also worked for me at PwC Consulting in Australia, here really is driving a new approach to providing blasting engineering services and also penetrating a fuller customer base with our new technology. This year, the revenue and operating margin from new technology products will double that of last year. And the blast engineering group is already a genuine point of differentiation in the market. And I just don't think this can be matched in depth or stall by anyone else in the region. There are really 4 many areas of focus to try and ensure that the LatAm region is successful in both the short term on the longer term. I've already talked a bit about quality of earnings. And I've also talked about maximizing our technology growth and differentiation through the Blast Engineering division. The third area of focus is, of course, safety. With all of Orica, we are working towards zero serious injuries. I'll start again. The third area of focus is safety, of course, and we are working towards a zero serious injuries. This will always be our aim, and this year my particular task was to try and bring excellent line with all of Orica's safety and environmental standards. And this has been achieved. We're particularly proud of the fact that all ground effluent from former exercises is now 100% recycled or treated. We'll continue to try and eliminate all serious injuries, of course, and also register emissions wherever we can. Finally, a focus for me and the tidiness people. Orica LatAm is a remarkable ethane diversity and a very large proportion of indigenous employees is evident in all of our countries. And we also have many people working in a different country to their country of origin. However, for gender diversity, we started this year as the lowest shrinking region in Orica, with under 10% of our total workforce in female and only 6% of our people in the field in female. This compares really poorly with the general balance of the top tier customer base we have and also to compares clearly with the gender balance on the rest of the Orica world. However, by the end of this year through a tremendous effort of the team, we will have doubled the proportion of female workers in the field from 6% to 12%. And by 2024, we want to be at 20%. One particular initiative gives us a lot of pride, and this is our skill of operators. We provide a 3-month training program for women from outside the industry. We pay full wages, digital training with the guarantee job at the end. We've now run the school of 5 countries in the region. And we run the school in difficult geographies where some of the people come from very difficult life circumstances. This program offers opportunity and so far the success rate is outstanding. But that's not the end of the story, but it's a significant kick start to modernizing a company in the Latin American region. When I look back over the last 9 months of this financial year, the things I'm pleased about most -- so the team responded to the supply chain emergencies we had. Dealing with shipping kiosks, unavailable or unavailability of capacity rates that were 3 or 4x as much as they were at the beginning of the year, in our Russian ammonium nitrate export plan, the Ukraine and Russian war, which extended that ban. Every twist and turn we've had the supply chain team and the commercial team has reacted rapidly decisively and we've managed to make sure that we didn't delay deliveries to any of our customers. But more support, that we've not let these shocks distract us from any of the 4 key objectives that I've been talking about for this year. Thank you for the opportunity to talk a little bit about Latin America, the most exciting region in the Orica portfolio, and I'll be available to answer any questions you have later on today.

Well, good morning, everybody. I'm sorry I can't be in Sydney today. But for those of you who haven't presented to you before, my name is James Bonnor, and I'm the Group Executive and President for the EMEA region prior to taken this role on about a year ago, I was in the same role running our North American region. I've been with the company for just on 28 years and had the privilege to work across the globe in many different parts of operations and divisions. So I'm going to talk to you today about the EMEA region and sort of take you through where we're at and where we see the region hitting and some of the opportunities that are important to us. So if I look at the region at a sort of macro view, in the context of Orica, it's a relatively small part of the business, around 14% of the revenue and 5% of the EBIT, which is as of the first half of this financial year. When we look at it from a revenue perspective, the 3 subregions we operate across EMEA basically have a very similar spread, although that will change as we reset the CIS portfolio, and I'll talk about that a little bit more shortly. When we look at it from a commodity perspective, the revenue -- the commodity mix is actually very favorable in the EMEA region where we have a strong exposure to copper, gold and quarrying construction markets and a relatively low or very low exposure to the thermal and metallurgical coal market. So we also have an emerging opportunity with the future-facing commodities across the region, particularly in Africa, the Iberian, Peninsula and part of -- in the Nordics, which we see receives a cobalt, nickel, zinc, lithium that are going to be very important into the future. So that really gives you an overview of the region. It's been a particularly difficult 12 months over the last while. We've had to deal with some pretty challenging macro environment in the sense of energy markets, which have skyrocketed as a consequence of very tight gas suppliers initially, but also compounded by the invasion of Ukraine by Russia, which has resulted in a very high cost of energy and subsequently a very high cost of ammonia ammonium nitrate, which is a key feedstock to our business. So I'll talk a little bit about that later. And then on top of that, we've had a general spike and inflationary costs and supply chain constraints somewhat as a consequence of the -- or hangover from the COVID pandemic. So a challenging environment, but that all said, we've actually had quite steady volumes in the past few months as we come out of the winter into the spring and summer months, where we're seeing the typical seasonal uplift. So despite all that, we are seeing volumes improving. So if I just -- before I move on, I'll just talk about our Russian business. As was mentioned at the half year results, we are exiting our Russia business. Russia has been a good country for us over the last 20 years. However, the decision is being made, and we are in the process of very advanced actually in the process of exiting our Russian operations. We're doing this in a very considered way, ensuring that the safety and security of our staff in Russia, ensuring we meet all the regulatory requirements and also ensuring that we don't leave our customers hanging when it comes to supply of -- for their mines. So that transition is well advanced, and we will hopefully be updating more on that at the full year results. So if I now move to the next slide and really talk about the 3 subregions in a little bit more detail. The Europe and Middle East subregion is a challenging region in the sense that it's very fragmented. It's largely quarrying construction. And it's -- we operate across many countries, and we have been working through a rationalization of some of those countries really focusing on some core markets, in the Europe and Middle East region. We see plenty of potential in the Nordics region. We see a lot of potential in the Middle East, and that's an area that we're developing at the moment. We do face quite a lot of competition from local industry players. There aren't many of the global players operating across Europe and Middle East. But -- and we also have an AN market, which is 100% sourced from third parties. So we rely on partnerships with fertilizer companies for our AN supply across Europe and Middle East. In Africa, we see a lot of potential and a lot of opportunity. We are underweight when it comes to market share in Africa, and that's something that we intend to improve on. It is a great commodity exposure, both gold, copper and future-facing commodities, we see is very exciting in Africa. It's a challenging market from a geopolitical perspective, and that's something that we have to work hard on. And certainly in recent months has become very tight around ammonium nitrate supply and something that we've been able to bring value to our customers through security supply of ammonium nitrate. And then lastly, the CIS, so the Commonwealth and independent states. We will be, as I mentioned, exiting Russia. So when we look at the CIS post Russia, we have a very good business in Kazakhstan, and that's one that we've been growing and will continue to grow over the coming years. But we're also looking at other opportunities and that sort of Eastern European and also Central Asia market, where there are opportunities that we can go after and grow the CIS subregion and help offset the loss of the Russian business. So when we sort of summarize and distill that down in some key points, we really are looking at selective footprint expansion, particularly into Africa, possibly into the CIS. We are really focused on technology differentiation. So where we do into these new markets, it will be based on bringing value through our technology to the customers, and we're getting a lot of pull from that, particularly in Africa. We'll be looking at improved margins as a consequence of managing the volatility of our ammonium nitrate sourcing dynamics that we've been having to deal with and really looking at long-term structural positions with the change in that ammonium nitrate structure. So moving to the next slide, just to talk a little bit more around technology. We have a lot of opportunities across EMEA for technology. We have a strong customer pool for particularly our digital and WebGen suite of technologies. We are investing significantly at the moment in recruiting and training our specialists to help drive the adoption and penetration of our digital suite. And we are also working on some of the challenges our customers face, particularly from environmental compliance perspective, working with them to utilize some of our digital technologies to improve the environmental outcomes for the operations. With WebGen, we have a really good portfolio of customer opportunities. We have had some already mines operating with WebGen, but we have a lot more underway, and we now have the approvals for the European business to progress with the WebGen technology. So that's a big opportunity for us across Europe. Obviously, the enhanced safety and flexibility that WebGen brings to mine operations is something that's very attractive to our customers. And obviously, the productivity and financial returns that can be generated from utilizing wireless technology. Exposes an interesting development that's something we've been pushing, particularly into Africa is our cyclo technology. That's a technology that really has a very environmental angle to it, and it basically takes the waste oil from the mines, and we basically reprocess it and then utilize it in our emulsion formulation. So it's a big problem for mines to deal with waste oil and something that our cyclone technology has proven to be very successful with. And then looking at some of our more specialized bulk emulsions where we had to deal with some challenging environmental conditions. A good example of that recently where we won a large contract in Zambia, where we have found -- we utilized our technology to solve a particular problem around hot reactive ground for that particular customer. And then lastly, Electronic Blasting Systems, I mean, that's an important part of our suite of technologies everywhere around the world, but particularly in Europe, in the tunneling market, we've seen a significant increase in penetration of electronic systems as a consequence of increased regulatory controls around vibration management, dust management and it's something that we've been able to really utilize the systems to drive our penetration into that market. So continued focus on technology. We want to win and grow this business across EMEA based on being a technology leader, and that's exactly where we're heading. And so to summarize, we really are looking at balancing our portfolio, leveraging our growth into Africa and other parts of the market to offset our exit from our Russian business. We have optimized our underlying business through a restructure on our mining and acquiring and construction verticals. And we have had a lot of time and effort spent on ensuring security supply in this very volatile geopolitical environment. We are, I mentioned -- talked about technology, which continue to grow our technology penetration. We are recruiting more people to support that and we see a lot of potential in the future for our technology portfolio. And then partnering with our customers for some of their ESG goals really aligning and working together on how we can improve the industry -- like I mentioned, the cyclo technology is a good example. But looking at emissions and other improvements in our business that we can all work together on reducing overall environmental impact. And not forgetting also community investment, working with local content in particular countries around the world. And using our training and development to broaden skills development across a lot of these emerging countries and ensuring local employment, which is an important goal of many of these countries that we're operating in. So that's really just a brief summary of the EMEA region. I hope it's been being useful and look forward to updating in further financial updates.

Good morning, everyone, and welcome. For those of you who I haven't met, my name is Jamie Crough, and I'm the Group Executive and President of our North American business. I've been with Orica for just over 3 years now. I started initially in what was the APA business, including 9 months as interim President and then moved across to North America last October. I've looked in the chemicals industry for over 15 years now and had the privilege of working across a number of countries, including Australia, New Zealand, Asia, North America and parts of Europe. And today, I'll give you an overview of the North American mining market, the current business conditions and the outlook for our North American business. So on the first slide, you'll see North America is the second largest region within Orica, accounting for close to 1/4 of Orica's sales volumes, revenue and EBIT. The commodity mix in North America is well balanced with a strong weighting towards hard rock metals and Quarry & Construction with thermal coal now representing around 12% of that portfolio. The key strategic advantages, I would say that characterize the North American business is the diverse range of commodities that we operate in, and we do this across a very challenging geographic market. Orica has an unmatched position across the region. And just to give you some context on the size of that business, we have access to over 1.5 million tonnes of ammonium nitrate supply either in-house or through third parties. Our IS and EBS manufacturing plants, including Brownsburg in Canada is the largest EBS plant anywhere in the world. We have 16 emulsion plants with many of these on customer sites and over 100 of what we call downstream sites, including rail transloads and distribution centers. So being able to operate safely, supporting our customers all the way from the Arctic circle through to Southern Mexico with an established asset base is essential in this market. And the competitive advantage generated from this is unmatched in the industry. And finally, in terms of mining, North America has an abundance of high-quality mineral reserves with relatively low sovereign risk. And this generates a very positive environment for mining investment. So as I mentioned, one of our key strategic advantages is our geographic spread. And as you can see on the next slide, each of the countries within the North American region have their own individual opportunities, challenges and what is most important to our customers varies depending on the sector. In terms of the United States, we've been very well positioned through our joint venture, Southwest Energy to support increased metals production in Arizona and Nevada driven by record metal prices and also, an increase in coal demand in the Palter River Basin in Appalachia through our joint venture partner in Nelson Brothers. And just incidentally, we've seen a medium-term rally of thermal coal demand due to higher domestic natural gas prices in the U.S., driven by increased LNG exports to Europe, a direct result of the Russia-Ukraine conflict, as James just mentioned previously. In terms of our Canadian business, this really is a gem in the Orica portfolio. Through our Carson facility, we have an excellent manufacturing footprint combined with deep long-term relationships with First Nation customers, which is critical to being successful across a number of very remote mining locations throughout Canada. Environmental license to operate and the use of low carbon intensive mining inputs is becoming critical to our customers within the region. The investments in carbon abatement technology at Carseland and nitrate containing products such as Fortis Protect are critical for Orica in helping to support our customers in a changing ESG environment. And lastly, whilst our Mexican business is the smallest country in the region, it still represents an important contribution. Strong supply positions with AN sourced from a local producer, together with IS packaged and bulk explosives supply from our Cuatrocienigas plant in the north of the country, provides significant security of supply across a full range of products for our customers. And also the adoption of technology solutions by more and more value buyer type customers looking to reduce dilution, improved fragmentation and improved wall control is very encouraging. So our geographic spread, security of AN supply and technology providing smarter solutions for our customers that reduces their overall mining costs of what sets Orica apart within the region. So turning to the next slide. I guess the question is, in a mature market, where is the growth going to come from? And looking at the map in the U.S., as I said earlier, Orica is well positioned in the Southwest metals market. And on top of this, New gold mining growth in Alaska is very promising given our existing customer relationships and Orica has the technology to support our customers in what is a highly sensitive location in terms of ESG. We have exciting opportunities to grow in the Q&C sector, both in Texas and Florida, 2 of the largest crush stone markets in the U.S., and this will be further supported by the U.S. infrastructure bill that was passed by Congress last year. In terms of the Canadian market, what's exciting is the investment in greenfield gold projects in British Columbia, along with 3 starts in recent years in the iron ore mines up in Eastern Canada and the metallurgical mines in Alberta. And on top of this are the lithium and iron ore projects within the ring of fire in Ontario. And if you look at the sheer number of prospective projects in Western Canada, it is very clear that Carseland is very well positioned to competitively service these mines. And this very much supports the feasibility work that we're currently doing and looking to debottleneck the plant. And finally, mining activity in Mexico is improving. Orica is well positioned in terms of domestic local supply, particularly given a number of supply contracts for mines in the region are expiring in the next 12 months and have been significantly impacted recently by international supply chain disruptions. And this just emphasizes the strategic advantage of reliable in-country supply coupled with a well-developed technology offering. Turning to the next slide. Orica is the undisputed market leader when it comes to technological advancements that solve difficult mining problems for our customers. And the North American team have done a fantastic job bringing these products and services to market. In terms of WebGen, this year, we'll have blasted our highest number of underground stopes using the most number of diverse mining methods. In fact, 1 enterprise customer has redesigned their mine plan based on using WebGen as a service. And we've been able to lift ore recovery from an average of 90% last year to 97% this year with a 13% reduction in dilution and this is currently their biggest mining problem. In the bulk explosive space, what's most important to our customers on the ESG side is supporting our license to operate through precise blast control and also an extended product range that meets the flexibility of required blast outcomes. And 2 great examples for me are Fortis Protect and the growing adoption within the Canadian market due to the need to limit fuming and potential nitrate runoff and 4D, a product that delivers variable explosive energy, automatically adjusted within a single blast hole. And what's really interesting is based off customer feedback, we're currently working on a combination of these 2 products, specifically for use in the Q&C segment. And then lastly, in the digital space, we've seen a significant increase in sales of OREPro, FRAGTrack, BlastIQ and 3GSM across all regions, particularly in the U.S. and Mexico. And as a result of this, we're increasing the size of our digital sales team to further support our customers. As I said earlier, Orica is the undisputed market leader in this field and positively to the North American region. Our customers are some of the most innovative globally. And turning to the last slide. In terms of the key priorities for the region and outlook, we are well positioned for further profitable growth. As the market leader, it is critically important that we're disciplined when it comes to our pricing strategy as our contracts renew over the coming years. And this has never been more important given the current highly inflationary environment and what is looking like being a short market for at least the medium term. To support our focus on pricing discipline, now that we've reached and are moving beyond stabilization, our new SAP system is starting to provide new insight into contract and site profitability, and this is having a very positive impact through our pricing strategy. Partnering for progress is critical to our success. At our Carseland facility in partnership with the Alberta government we've made significant investments in reducing our greenhouse gas emissions through tertiary abatement technology. And positively, our major suppliers are also investing to reduce their Scope 1 emissions, and we're working together to produce low carbon-intensive products for our industry. And this, I think, will soon be a license to operate. In terms of safety, North America has led the way with the rollout and adoption of our major hazard management program with very positive results, and we're now replicating this at our Carseland plant, and we'll have this completed by the end of the year. And finally and most importantly, I have been incredibly impressed by the capability, resilience and tenacity of our people in North America. One of the most important things the leadership team and I do every day is develop the next generation of Orica leaders, taking bold action to improve diversity, equity and inclusion and provide development opportunities for our key talent. And right behind safety, this is my and the team's highest priority. So hopefully, you can see the region is well positioned for growth. And with that, I'll now hand back to Delphine.

Thanks, Jamie. So those were the 5 regions that you just heard from. Now we'll turn to the next vertical, Quarry & Construction. In the Q&C sector, integrated processes are the key to unlocking greater productivity, profitability and more importantly, sustainable outcomes. This will play a crucial role across the quarries of the future. In this video, you're going to have a look at now. It's from quarry customer in New Zealand, Stephenson, on how they're harnessing our FRAGTrack technology to monitor the size of the rock through the crusher and optimize blasting to increase productivity and sustainable outcomes, thereby reducing the overall carbon footprint of the operation dramatically. Let's have a look at this video. [Presentation]

I'll now introduce James back to talk to us about Quarry & Construction.

Well, thanks, Delphine, and good morning once again, everybody. It's my pleasure to talk to you this morning about the Q&C market. And about 12 months ago with our strategy refresh, we've determined to set up the Quarry & Construction as a strategic vertical across the business. This will enable greater focus across the various regions on the Quarry & Construction sector. Now why do we think that's important? Well, we believe with dedicated focus into this area, we can improve our overall returns through basically leveraging our existing market positions across the markets that we're operating in the Q&C segment already and developing new physicians into some of the emerging markets around the globe, leveraging some of our technology that we haven't been applying as actively into the Q&C market, being more proactive on that and really looking at leveraging our operational footprint, and best practice across the globe to ensure we can grow this market segment. And I'm going to talk to you about this over the next 15 minutes on how we're going to go about that. So if we move to just sort of macro context of the Q&C market and the fundamentals of this market is there is going to be increased spend across the globe in Quarry & Construction over the coming decade. And when we talk about Quarry & Construction, we particularly -- we mean quarries, we mean construction, but we also mean underground tunneling as being a very important part of that segment. If you look at it from a materials move perspective, it's actually got the largest compound growth of all the commodities that we deal with. And so it's important and attractive for us to be involved in. And you look at some of the markets where it's -- where we're seeing a lot of the growth that's in some of the mature markets like the United States and Europe, but also some of the emerging markets in countries such as India and across Southeast Asia. So we certainly see this market as a growing market and one that we can extract more value from. And then tunneling is a large market, and I'll talk a little bit more about tunneling later. But it's large, but it's also growing. And it's a market that we do want to get bold and involved more in. So when you look at our operations from a global perspective, we already have Q&C operations in many countries around the world. I've highlighted the ones we would sort of got more mature markets and mature operations. But from a revenue perspective, the Q&C market represents 14% of the total revenue of Orica. And we estimate the market for explosives in the Q&C sector is around AUD 4 billion, which is smaller to the larger mining explosives market but important or the same and one that we should be getting our share of. It is a fairly fragmented market and it's more regionally or country driven. You don't tend to see the big global players in the Q&C market like you do see in the mining market. We have both direct and indirect channels across the market, and that's a characteristic of the market. And the customers vary in size from large sort of corporate quarries to small, privately owned mom-and-pop type independent quarries. And whilst they are quite different profiles of operations, they have sort of common needs around ensuring that we can deliver reliable blast outcomes and optimize their blasting costs. When we look at the construction market and the customers in that market, it's very much in more urban environments, and it's very much a more sensitive type environment from an environmental compliance perspective. And so precision blasting becomes a key driver of that type of market segment. And customers have very high expectations around responsiveness and reliability. And we need to be able to grow on the back of our mining business into these Q&C segments where they are co-related co-located and also where they are not. And technology will be a key enabler in pulling together the various elements of our technology to drive that growth into that segment. So if we move more specifically, I wanted to talk about tunneling. And as many of the cities around the world look to future proof their infrastructure, and we're seeing this a lot right now in existing cities, but also emerging cities as they plan their infrastructure for the future, underground tunneling is becoming a really important part of that. And it's a huge market globally, around USD 140 billion and over 5,000 kilometers of tunneling completed in 2019. And drills is still an important part of the tunneling market and particularly in challenging geological environments, where there's very hard rock or very diverse rock, the blasting becomes a very key part of how we operate. Underground civil tunneling is used across rail, road, transportation, strategic storage of critical commodities, which is a market segment we see is growing over the coming years. And obviously, projects like hydroelectric power projects, and so a large and important segment that we do want to be part of. We've seen significant growth across tunneling market in recent years. Some good examples of Singapore, Hong Kong, Seoul, Tokyo, parts of Saudi Arabia, where land constraints and restrictions have to be considered when looking at the options of how to operate infrastructure across these large and complex cities. And I mentioned the growth in underground energy storage, strategic storage of likes of oil will become more and more important. And I think more and more countries will be looking at moving a lot of that strategic storage underground. And that, in turn, is a really big opportunity for us to get involved, and we have been involved in some of these projects in the past. So just coming back to the Q&C sector and looking at our sort of a couple of examples from both the mature markets and the growth markets. If I highlight the U.S. market, which I know well, it's a very large Q&C market, and it's been fueled currently by a significant infrastructure commitment from the federal government in the U.S. with an infrastructure bill from 2021. And we're seeing that manifest itself now in the Q&C market and growth that we're involved in. It's a mature market. Orica is one of the market leaders in the U.S. market. And we operate through both our direct and indirect channels, and we sort of manage that through the markets across the states, across the U.S. There's a strong technical pool for value from these customers, and we're seeing that increase as quarrying becomes more complex and environmental constraints increase. And then the underground Q&C segment is one that we certainly are looking at increasing our penetration in the United States. Another core market for us is the Nordics, and this is an important market, both from a Quarry & Construction, but also a tunneling perspective, particularly in Norway. And there's a high focus on environmental compliance and something that we've been very successful with in that particular market. When I look at some of the growth regions, India is a significant growth opportunity for us. There's a commitment to infrastructure spending over the coming decade of around $1.5 trillion. So an enormous amount of funds being committed to infrastructure spend, that's going to be important that we're part of that. It's a pretty immature market from a technology perspective and introducing the like of our electronic blasting systems and really partnering with some of the core infrastructure contractors into that market segment, we see as key in really positioning ourselves as a technology leader, we have to provide more efficient and productive blasting outcomes whilst also meeting a lot of the challenging environmental constraints. And also not losing site in India of the potential for underground tunneling projects. And then just lastly, to talk about one of the other key growth regions that we see is Southeast Asia. And again, with the emerging economies in this part of the world and government spending on both private and government spending on infrastructure, we see this as a really attractive growth market for us. We had pretty solid positions in some of the countries across Southeast Asia, like Indonesia, Malaysia, and the Philippines, but there are other countries where we can probably look at more direct operations as well or look at indirect alternatives to penetrate into those other countries that we're not currently operating in. And as I mentioned earlier on, the civil tunneling market in Southeast Asia is a very, very important and large market that we intend to grow our market share and utilizing our electronics and bulk systems. So when you look at it from an industry perspective and the customer needs, civil tunneling is all about speed of completion, but in a very safe and environmentally compliant way. And our technology suite really does come together extremely well into civil tunneling along with our expertise that we have in parts of globe. We need to share that best practice across the globe and growing into this market segment. When we're looking at the quarrying operations, a lot of it's about productivity, production volume and meeting those type environmental compliance regulations and something that, again, our technical and operational expertise really gives us an edge into that market segment. And lastly, the urban construction market is something that -- a market segment that we certainly want to grow a share of. And we believe with the real precise control blasting techniques we can bring to that segment and have successfully executed in many parts of the world; we can broaden that around the globe. And a big part of that is really demonstrating some of those solutions from a compliance and environmental compliance perspective and continuing to look the standards in that regard. And then finally, just to summarize what we bring. Why do we think we can be successful into the -- more successful into the Quarry & Construction market segments? While we have industry-leading people, we all know that expertise where we're not applying in the Q&C market. We can easily transfer it, we have strong relationships. We need to broaden those in some of the core emerging markets. We have a great product range, and we have flexibility in our operating model to be able to adapt to different market segments and different country requirements as we grow across Q&C. Our global reach is a strength for our mining business, of course, but it's also a strength for our Q&C segment. We have global reach. We also have local knowledge and either directly or indirectly through our partners, and we can utilize that reach to succeed. And lastly, on that point, we have a very strong ammonium nitrate supply network, and that's very important as a key raw material in any of the explosives markets we choose to operate in. And lastly, our commitment to sustainability and really working with our partners around environmental compliance and ensuring that we are collaborating and partnering with emissions reductions and working together on achieving those goals that we all must focus on. And underpinning all of that, of course, is safety is our priority always and we'll never lose sight of that, if we can't operate our operations safely, then we won't be doing it. And so that's really it from the Q&C vertical. I hope it's been useful. And I'll look forward to updating you and the future on our success and growth into this key market segment. Thank you.

Thank you, James. Let's open up to Q&A. We'll start from those on the line.

We've got about 11 questions online, but let's go to the first 3 that have been uploaded. Sanjeev, I think I'll start with the first one. APAC has been in a pricing-led downgrade cycle for a decade. What's the outlook for pricing. Net pricing more useful. They wanted at a net pricing perspective. assuming we can pass through the high cost. So why don't you start and will throw it to German?

I think I've commented extensively on this. There was a history there was a reason. We were building new factories. We were filling new capacities in the past, and we were chasing volumes. Those days are over. I think I said this in the first half that the plants are sold out, capacities are sold out. I think Adam mentioned that we have record production in Indonesia and on time. So we do not have volumes to chase, and we don't intend to do that. Brian, in Latin America also mentioned that today, we are more than happy to walk away from business if it does not fulfill our own internal requirements in terms of returns and profitability. And customers do appreciate the fact that we are reliable. We bring in all the technology that we talked about and there is a much higher willingness to pay. So yes, there was a history, there was a certain reason for that. I think I tried to explain that several times today, so I'm not spending more time on history here. Going forward, I think every region and every President mentioned commercial discipline, and that's topmost and foremost in terms of the way we operate in the market as a price leader and as a market leader. German, on Australia, do you want to make any comments?

I think you covered the question very well. But just to answer into groups. One is existing contracts. We have rigorous in the contracts, and we execute them with discipline, and therefore, we transfer the good cost. And the second one will be the new contracts. So any new contracts normally on a one-on-one basis if they are large or at minimum on a quarterly basis in our pricing policy. The updated and review at the light of what's going on the market and what is the next [indiscernible] focus for us as import parity has increased in Australia significantly as we have seen in particularly dry out of import into Australia. The market has become tighter, and this has been reflected in the pricing policies.

Thanks, German. The next 2 questions, James Bonnor, I think these are for you. The first one is with 28 years at Orica, how is the current Orica different from previous versions? And the second question for you is where is the AN coming from now that -- sorry, where is the AN coming from that you replaced Russian AN with? James Bonnor?

Thanks, Delphine. Look, 28 years Orica has changed a lot from ICI Australia to a diversified chemicals company essentially to a globally focused on services currently. And I think what's really starting to emerge, it's taken a long time, these transformations don't happen overnight. What's starting to emerge now is or is emerging is we really are now trying to get a lot of really strong pick points of competitive advantage. Firstly, we -- our global reach, and I think it's become very apparent in the pandemic has been a real advantage for us and we have to sustain our supply into the regions where we don't have domestic production like South Africa, Latin America. And our customers really have value that. It's been a very tough thing to manage. But I think our reach versus a lot of our probably more regional competitors has really been an advantage. But probably where the main area of competitive advantage, which we're driving is we're finally tying together the digital suite. And what I mean by that is it's not just being able to create a lot of data. It's what we do with the data, and in particular, the we talked about FRAGTrack as an example, being able to measure the benefits we create for our customers. It's all very good going in and saying we can blast data. We can give you a bit better blast outcomes it's all about showing me the money. And to me, the emergence of some of our digital technologies, which provide very accurate data around measurement of benefit, measurement of performance is something that I think we can now extract more and more value in collaboration with our customers, where we will benefit as well as our customers through being able to demonstrate that value. So sort of time together that global reach and that global focus, bringing that technology to the table but actually being able to demonstrate the value, that's the big shift, I think, in probably the last 4 or 5 years, and we continue to build on that. I'm sure Angus will talk more about that later. The second question regarding ammonium nitrate supply, we've had networks across the world with the ammonium nitrate. We haven't always been so beholden to Russian supply. But we -- we've sourced product from multiple sources, including Spain, Sweden, we've sourced product in Lithuania, Georgia. There are ammonium nitrate -- there is ammonium nitrate capacity out there, and our network has been able to tap into that, react very quickly and ensure that we can meet those demand needs of customers with the constraints around Russian exports and moving forward, we back ourselves to be able to continue to do that.

Thanks, James. We've got Leah Barlow in the room. She heads up supply and manufacturing. Leah, do you want to add anything to what James just said.

Yes, sure. Just to complement that German Morales actually mentioned it in his presentation where we've actually converted from [indiscernible], which is our is to melt the product. And we've been able to leverage, particularly in the height of the Russian crisis being able to ship AN out of our facilities in Australia into LatAm and Africa. And at the same time, it's not about just trying to unlock more capacity out of the plant. It's about unlocking the capacity from the network because that has been the biggest challenge, and it has been about shipping efficiencies. It's been about understanding how to move the distribution network in region, and it's also about being flexible in the production.

Thanks, Leah. [Operator Instructions]

It's Paul McTaggart from Citi Group. Future-facing commodities, Chile, in particular. So I cover mining stocks as well. So we're all quite concerned about the proposed mining taxes and changes to the constitution. So I want to get your sense on how you think that plays out in terms of Chile's ability to be competitive globally in copper reduction in the future.

It's a good question, and I'll ask Brian to comment on it. Brian and I always have a joke. He said, whenever we talk about Latin American business, don't talk about geopolitics that's business as usual for you. It's the same for everybody, right? And we found a way to operate in an environment where there is unpredictability, there are strikes happening, the social unrest, our customers shut down overnight. Our supply chain teams are so very well trained today. with the hardships of operating in Latin America that this has just become like, unfortunately, like COVID it's become business as usual. On the specific issue of Chile, I'll let Brian, he's the expert, he'll talk about it. But social unrest the shifts of governments moving more towards the left. We've seen that in the past, and this will continue in the future. The one positive that I can say about Latin America is that all economies there do understand the value of the mining sector. And whatever challenges are thrown at that sector, the sector has always shown resilience. And there is a very, very strong demand for the products that come out of Latin America, especially because somebody has to fill the hole that Russia leaves behind. Whether this is Africa, Latin America, there are opportunities in Asia. There are opportunities across the globe. And the government see this. And it's a source of revenue. It's a source of employment and tax income. And this sector has always found a way to operate. But Brian, more on Chile.

Yes. Look, Sanjeev, I mean, you're right, we found a way to operate here. And of course, when you talk about the proposed mining royalties in Chile, you still have to get in context that Chile is the most stable regime with the most established projects in Latin America. When I look at the outlook here, I see it as remarkably stable. And there's a lot of representation being made right now by the major mining companies to the Chilean government about the potential negative impact on future investment of these proposed increased royalties, [ every time ] they are one with them. But in terms of the next 5 years, what I see in Seaport, the leaders of the mining industry see here is stability. The one thing that might affect this government, new government is supposed to have a strong environmental bin and they have pushed back and a couple of project expansions recently because those expansions haven't had the right provision for water reuse. Water is a scarce resource, particularly in the middle of Chile. But in terms of the overall outlook, our models are of growth, stable growth for the next 4 to 5 years, our beta program is give towards and I think simple the major mining companies. So if you're following Chile, I think you're following a really -- a very stable region.

Thanks, Brian. A question from Scott.

Scott Ryall from Rimor Equity Research. I was hoping to ask a question on the mining side as well. And I'm wondering just with the -- with James' comment about being able to link up data and outcomes for customers, are you expecting over the coming 5 to 10 years, more of those sort of profit sharing, if I can call it, arrangements with customers. And related to that, there was a few comments made about sustainability. And I wonder if you could just share is the major focus for mining customers around sustainability to do with increased efficiency that takes out their carbon footprint? Or is there a willingness to pay for just straight decarbonization of their supply chain as well?

Great questions. Monetizing data is something that Orica has become pretty good at doing. So we help mine commodities and we help mine data and we create value out of data. And the future is all about data, right? Because, first of all, to know, secondly, to answer the question, so what? And thirdly, what is the outcome? And I like the term profit sharing, we call it value sharing. And that's what we do with our customers, where we say if we help you either save costs or improve productivity and improve your financial performance, there's a certain portion of that value that should flow back to us so that we can continue to reinvest in this kind of technology. And as you can imagine, these are not easy discussions. But we do manage to get checks every quarter from customers. So that model is working. We're scaling it up. But I'd like to hand over to Angus to talk about data and how we are monetizing data.

Thanks, Sanjeev. Look, I'll cover it a bit more in the talk. But in terms of the commercial playbook around our digital products, we really have 3 tiers of it. So at the base level, this is a discrete payment for each of those products and services is typically Software as a Service. So these are stand-alone profitable. The second tier is where we bundle 2 or more of those together. And again, that will be a discrete price around that offering. And then the third tier is more the performance-based outcome-based projects. And we have a number of those that are embedded, that are highly profitable for us. And I would say more broadly across the business, and I'll give you an example from Brian's area in Latin America, where we have a lot of rock and ground and outcome-based contracts. We've deployed first and foremost, our own technology through that. So Brian is using all of the digital tools through his blasting engineering group to underpin our outcome-based contracts. So there's many avenues to monetize the digital products and services.

On the ...

Sorry, you expect an increase over the coming 5 to 10 years of the utilization of these sort of mechanisms?

Absolutely. Absolutely. So that's going to be the model of the future, where we will sell products, services, and outcomes to our customers. And customers still have the option of selecting one or the other or all of them, right? And we've already had now the first successes in terms of commercial contracts, including end-to-end offerings, design for outcome or whatever you want to call that, where we have products, services and data all in into the contracts. And then we have the value sharing mechanism. So that's the way moving forward. In the past, the commercial model was value guarantees. And we are getting away from value guarantees, and we are moving to value share because, in my view, value guarantees are a one-way contract. That's not equitable, where the risk is all with Orica and the benefits are all with our partners, and that's not in my view, collaborative business model and not sustainable going forward. So we move forward to the value share or profit share model, as you called it, and we'll start to roll that out across the globe. So all future tenders and renewals and everything else will start with that baseline, and then we'll see what the customer feels comfortable with. The second question on sustainability, the answer is both. On one hand, there is a lot of value on license to operate because with high commodity prices and customers in most regions falling behind mine plans, there's emerging need to catch up. And the second one is obviously to manage ESG expectations of our customers, stakeholders, including their boards and their shareholders. So we have great examples of both. I think each region can talk about this, but the most prominent one, I think, was from Jamie in North America. Jamie, you want to talk about your low carbon offerings as well as the license to operate challenges in Canada.

Yes. Thanks, Sanjeev, and thanks for the question. I mean I guess an example would be Fortis Protect and the success we've had in Canada. So a number of our Canadian customers, one very large one, in particular, has an issue with nitrates runoff, and that is particularly sensitive from an ESG perspective in Canada and where the product came from was literally one of our technologists here, our product manager, working with the customer to understand their problem and coming up with different formulations in the mixed laboratory here in Denver in terms of an emulsion. And what they came up with was our highest [ Hibiscus ] emulsion that can be transported and pumped through a mini mix plant and through the hose on an MMU, that because of the viscosity of the product, when you blast it both limits fume and it limits nitrates runoff. And we've done some marketing on that product, but literally word of mouth of the success of the product has spread through Canada, and we're seeing increased sales across a number of customers in Canada. Another one that we have, Canadian customer uses plastic hole lining to try and limit nitrates runoff. Now that stops nitrates runoff, but when you blast it leaves plastic over the bench, which is another ESG issue, and they're also converting to Fortis Protect. And we've been able to charge it as a premium product. So that's been a great success in the Canadian business. In terms of the product itself, I think naturally, over time, the license to operate, in particular tenders will be that you can offer a low carbon-intensive product. And we've been able to demonstrate that out of Carson with the investment that we've made around our abatement system. That is running 2% or 3% ahead of its business case and we're producing a lower carbon AN and [indiscernible] meeting with one of our enterprise customers recently in the U.S. business, they casually dropped that going forward in a number of years that being able to demonstrate, you can supply the low carbon intensive and will be a ticket to participate in the tender itself. So we've made great progress out of Carseland, and we're working with our Scope 3 suppliers, and they're doing work around carbon capture, CO2 abatement green and blue ammonia.

Thanks, Jamie. We've got one question from the room, and then we'll take a break. Richard?

I might just sneak in a couple if I can. Richard Johnson from Jefferies. My first question is for Adam on Indonesia. And I was just wondering if you could talk through a little bit about the supply-demand balance in Indonesia and whether I'm presuming the new plant there is import replacement. And I'm curious as to know as to whether your contracts there are restricted by your ability to supply in or not out of Bontang or not?

Thanks very much for the question. So supply and demand balance in Indonesia, Bontang is clearly the largest plan, is a majority of the AN production in Indonesia. The new plant is roughly in the order of 20%, 25% of the size of Bontang. It is import replacement. It will move Indonesia from being an import AN market to net a broadly balanced market is probably the right way to think about it, but potentially a small importer potentially a small exporter. And so that's challenge that we look forward to tackling. The next question you had was -- I think that you were asking about the tie of -- are the contracts Bontang specific? Is that -- was that your question, the mining contracts in Indonesia?

Yes, kind of. I'm just trying to get a sense of what the underlying market growth or your growth is, particularly out of your coal customers there and whether that's your ability to grow is restrict the door by the supply side.

Well, I mean volumes we see of AN are not actually critical to growth given the other products that are coming through the pipeline. The Indonesian miners at the moment, they're delighted to work with us. We've got a great presence with them. AN's part of that. But more and more, we're moving towards a premium opportunity. So the solutions that are in the pipeline from whether it's WebGen or 4D are really what's driving margin growth for us in Indonesia. That's great.

And if I could just sneak 2 in for James, please. Yes. Is that all right?

And we've got a question to [indiscernible] too, and then we'll finish.

So James, I think you said that you were expecting growth in Africa to broadly offset the loss of Russia. I was just wondering if you could put a timing around that, please?

We think around a couple of years, maybe 3, but we're pushing hard. And we also see other opportunities across Western Europe. And I mentioned the Middle East and potentially Central Asia as other potential opportunities to offset the Russian reductions. But 2 to 3 years, I think, is a reasonable time frame.

Great. And then just on your presentation on Q&C, when I think about the opportunity in Asia, where you presumably you're under-representative, would I be right in thinking that you are -- I mean, would I be right in thinking that the current suppliers, they are relatively small regional people, and they may well source their AN from you? So you actually know where the contracts actually are, which will enable you to sort of short circuit the whole thing?

I think it's a mix, and Adam may want to add to this, but there's a number of smaller regional players, almost country-based players in Southeast Asia. Some of them, yes, we are wholesale to those types of organizations. Our preference to really extract more value from those markets where we take more direct positions, most likely. Or we could collaborate with them as sort of exclusive distributors or whatever we think is the right channel to market. But I don't know if you want to add to that, Adam.

Yes, sure. So Philippines, Malaysia, absolutely, we're already seeing as the key Q&C provider. We've got a great local partner in each of those markets. We're delighted to be with them. In India, our -- we're not really so much a source of AN as a source of EBS so -- and detonators. So India, Q&C projects occasionally using EBS which is rare and something that we're delighted to supply them on as well as premium debts, which again, that's the relationship that we might have with the ultimate quarries at the moment. So I think plenty of scope for growth in Q&C particularly in India with that sort of $1 trillion of infrastructure spend coming. And it's a positive conversation because the market is growing so fast, the construction companies, the companies that are deploying the aggregate, they're looking for conversations about growth, they're looking for conversations about productivity. It's not really undercutting each other on market prices. It's much rather how do we cope with the growth that's coming towards the market. That's very helpful.

Maybe, Richard, just to add this model in India to grow infrastructure's public private partnerships. And the team is one of a few new businesses, building new international airports and terminals across the country. So it's extremely attractive. So this is state-sponsored. But together with the private construction companies in India, it's a very organized sector with a lot of scale in it. So there's fantastic opportunities there. And they obviously want to operate with the highest levels of safety. And I would say the Q&C regulators there are much more aggressive than the mining regulators in India. So they are much more open to pay for new technologies and EBS and everything else. So that's been really exciting.

Thanks, Sanjeev. We've had a question from the right, if that -- Andrew, thank you.

Andrew Scott, Morgan Stanley. Just a question for Jamie on North America, slightly different in the way that you operate in the market there, given some reasonable joint venture operations. Just interested to the extent that, that -- it's obviously served you well, but that still makes sense going forward, particularly as you increase the sort of technology and sophistication of your operations there?

Thanks for the question. I've been very impressed with the capability of both of our major joint ventures, both in the metal space and the coal space. If you look at -- if you look at the quality of the customer relationships that they have, if you look at the service efficiency that they apply, if you look at the way that they sell technology, and you look at -- one in particular, the diversification of their business, that they are great business partners, a partner in the West. If you look at what they've done in terms of EBS penetration, we wouldn't have got there without them. And you look at our partner in the coal space and the level of market share that they've grown and the returns they're generating, I've been very impressed. I think they're great strategic partners. I don't see any reasons to move away from that. We're looking at an opportunity in the Q&C space. So we have a great sales force in the Q&C space. We have great security of supply. We have a great technology offering. We need to do more work on the manufacturing side around emulsion plants, and we're partnering with one of our key joint venture partners to grow in the Q&C space together. So I think they've been tremendous partners for the business to date.

So partnering for progress is a key enabler for us as part of our strategy and North America is a fantastic example. It's a model we'll also bring to other parts of the world where we are going to grow the business because we do not have to do everything ourselves. Sometimes a channel to market might be a partner who is much better positioned than we are, and they are basically our hands and feet on the ground and they have the capacity to breathe. So it gives us a lot more flexibility. And I think it's a fantastic success that we've had in North America. And we are -- Adam is also looking into Asia, for example, given the wide geography. James is looking into Europe to see whether we can also do better partnership models, given his success in North America to bring that more also to Western Europe. So yes, it's been a very pleasing progression with those 2 partners there.

Thanks, Sanjeev. That concludes this section. Let's take say a 12-minute break and come back at 10 minutes past 11 for the next session. So grab a cup of tea for those in the room, and there's something to eat too. Thank you. [Break]

Welcome back, everyone. Let's get into the next section, which is -- starts with Digital Solutions. But before we dive into that vertical, we just wanted to share a recent key milestone that was achieved by one of our latest blasting technologies. In this video, you'll see Avatel mechanized development charging system remotely loading our second-generation wireless initiation technology, WebGen. -- blast holes for the first time ever. This occurred only a couple of weeks ago in our key partner, Epiroc's test mine in Sweden. And it's the first time in the world a wireless initiation device has been recorded loading remotely into a blast hole. This is a significant milestone for the technology and for mining industry. Let's have a look at this. [Presentation]

Thank you, Delphine. Sanjeev mentioned partnering for progress, and that's just one of the examples of our industry partners with Epiroc. We've been working with on that piece of technology for the last couple of years. It's really exciting. We've got 2 prototype units. The one you just saw, which we've just tested in Sweden over the last month, and we've just got one that's arrived in Australia. Thanks for joining us today. My name is Angus Melbourne, Orica's Chief Technology Officer, with accountability for development and execution of our technology strategy and our digital solutions business. I'm in my seventh year with Orica. I started in the Australia, Asia Pacific business as President. And then I moved into developing and commercializing our technology programs. Over that time, I've also overseen parts of the business, including China and launching and overseeing our digital solutions business. Now for customer-facing technology, the strategy focuses on 3 streams of development. The first one is advanced blasting products, and that's built on 140 years of innovation and blasting expertise, autonomous blasting systems, and this is really about eliminating the manual work processes that drive safety and productivity. And then the third is digital solutions. This is the sensors software and data science that we deploy in our blasting operations, upstream and downstream in adjacencies and in integrating workflows across the mining value chain. Now the first of these 2 streams, I'm not going to cover today. We're really excited to have some of you tomorrow at the Caraco Technology Center, where will really showcase a lot of those blasting and the digital technologies. And I think also my colleagues have covered extremely well our more recent blasting -- advanced blasting products like WebGen and 4D because we are in the commercialization phase. We are scaling both of those technologies and getting real traction. So the focus of my presentation today is on the third stream, which is Orica Digital Solutions. Now like many sectors, mining is being rapidly reimagined and it's a really exciting time to be in the industry. Now mining has been a little late to the party compared to some of the other industries, but it's rapidly making up for lost time. Digital technologies are now delivering significant advances in safety, productivity and environmental outcomes. Computational power, AI, Internet of Things, these are transforming every element of the mining value chain. Now critically, the convergence of these technologies and solutions are allowing us to think differently, to mine differently, to blast more precisely and most importantly, remove people from harm's way, Exhibit A, the Avatel technology you just saw. Now we've come a long way from that historic miner on the left, the very -- with the very manual workflows to the digital miner on the right, who is rapidly moving towards a future of integrated and automated data flows. So what's the size of the prize here? McKinsey estimates that the total industry productivity value from a mega trend in digitization is over $350 billion per year. Of that, more than $250 billion is around operations and operations management. So while initially lagging other industries, the mining industry is now embracing the productivity potential and pursuing automation and data integration to improve the speed and quality of our decision-making. Now within this mega trend, there is a gap for integrated and end-to-end digital workflows. The mining value chain is fragmented by nature. Now this is particularly true in and around blasting, and blasting is a critical point of value determination for our customers. I know there are lots of people driving digital technologies across the mining value chain. And I always say, I like our position, blasting is a great place to leap from to leverage from. Now while integration of this data in this space has progressed, there is no clear champion that's emerged. And this represents a unique opportunity for Orica to provide real-time measurements and insights that can drive quantifiable benefits. James alluded to that earlier in what's changed now. It's our ability to really quantify and demonstrate where we're bringing value from blasting. We've created an animation to show just how Orica is creating the industry's first end-to-end integration. Let's take a look. [Presentation]

Now Orica's Digital Solutions with its core principles of being open, secure and integrated is positioning Orica to become the industry's first end-to-end solutions provider. A journey that started 5 years ago, our Orica digital business is really anchored in 2 important physical parts of the value chain. The first is in blasting and the second is in slope stability monitoring. Orica's advantage comes from our global footprint, our physical presence on the bench where we play critical role in altering the rock's composition, have domain expertise in blast management and our leading suite of digital products. Now additionally, we have acquired and developed measurement capabilities upstream in the ore body knowledge space and modeling and simulation capability downstream from blasting to ore processing. In each of these positions, we're monetizing applications of sensors, software and data science in discrete products, and we're integrating the information generated from each of these workflows to create insights for optimizations and new solutions across other parts of the value chain. The last 5 years of development and acquisition has resulted in a consistent cadence of new product introduction that we've rolled out year-on-year. And look, I'm really proud of what we achieved. Last time, I spoke to you, we outlined our strategy for digital solutions, and we have delivered on that strategy. And you'll see tomorrow how proud the team is on really putting together what is an unrivaled portfolio of digital solutions and technologies, not just in blasting, but across all of mining services. The digital ecosystems harness data, scientific knowledge and domain expertise to fundamentally change the way of working across that chain. The Orica digital environment makes applications and workflows accessible to all the users and enables our customers to build common workspaces for data, models and interpretations while respecting the proprietary information boundaries. I'd like to get into a little -- into each of the 3 areas in a little bit more detail, starting with ore body intelligence. Now Orica's purpose is to sustainably mobilize the 3 sources and achieving this starts with a better understanding of the ore body at the start of the chain. Miners are now increasing their adoption of technology as they transition towards the concept of a digital mine. They've also recognized the materiality of improving their ore body knowledge throughout the mining life cycle as a key source of value creation. Now I started my career 30 years ago as a wireline logging engineer in the oil and gas sector. And I saw firsthand the evolution and the importance of Geotech and geoscience information in resource development. Now while geoscience measurements have long been used in the mining industry, more advance technologies often originally emanating from oil and gas are now being adapted for mining and becoming far more prevalent. As blasting technologies evolve around the world, demand for ore body knowledge also increases. If I make one point that I want to leave you with today in terms of right to play and why we're taking a position in ore body intelligence, I'll repeat it, as blasting technologies evolve, the demand for ore body intelligence increases. We talked about 4D, we talked about WebGen. These are driving new mining methods. It's enabling us to blast with far more precision by distributing energy across the bench. In order to leverage that capability, we need better and more precise knowledge from upstream. So let me talk a little bit about what I mean by ore body intelligence and ore body intelligence capability. So first of all, there's the geophysical and the geomechanical measurements. So this is like a natural gamma ray measurement or spectroscopy measurement or an NMR measurement, like you get in the hospital but on the rock itself. This is the what -- this is the what of any geological model. Then there's the geospatial information. This is the gyroscope information. This is the where in the geospatial model. You need to be able to position those measurements and understand where they are physically in the earth model. And this is currently a gap in our portfolio. And then the importance of time when the acquisition and when the processing is done. So typically, a measurement while drilling application will give you a real-time measurement of that data. This is the when. And of course, from an end-to-end workflows perspective, we're interested in the insights that can be generated from this. This is the so what. Now Orica is uniquely placed to provide critical geoscience information to the industry and to create value downstream by connecting the information to blasting. Today, we're in complex geotechnical data into the blast design to ensure that the right energy is delivered in the right space and time to achieve the desired customer outcomes. Moving on to blast design and control. Blast design and control is where we began our digital solutions journey just over 5 years ago. Digitizing blasting workflows allows the customers to predict, control and measure the what -- sorry, and measure what will and has happened to create a continuous improvement cycle. Moving from manual workflows to digital workflows also provides a really important foundation for automating processes. Everybody thinks automation is about self-driving vehicles. And absolutely, that's part of it. But actually automating what we do, the processes and the loading and the executing of blasting is true automation. You can't automate unless you've got a digital platform of your workflows to build upon. Our blast design offer helps customers to achieve better quality blast outcomes and eliminates excess drilling and explosives consumption. Our blast control solutions offer full control throughout the blasting process through improved visibility and control of the on-bench operations. And having cemented our position as the market leader in blast design and control software, we've further expanded our offering to include ore dilution and grade control workflow solutions through OREPro 3D. You'll see all of the regions referenced OREPro 3D. This is -- we're getting very rapid uptake on this particular product. And what's this about? So this is about understanding where the rock mass has moved post blast, and it's critical to separating ore and waste for grade control and downstream processing efficiencies. The ore dilution grade control offer enabled through OREPro 3D is the industry's first solution that optimizes ore control in 3D. And this is a software model. This doesn't require invasive hardware deployed and sensors to detect blast movement. Next, by modeling and simulating blast outcomes before they happen, engineers can develop blast designs, customized for specific processing requirements downstream. The highly regarded integration extraction simulation, or IES, was developed by the industry consortium CRC ore. This now resides within Orica following a competitive process to select the commercialization partner. Using IES, our mine-to-mill offering, we now have the industry's first real digital twin with the capability to model from ore body to -- all the way through to mineral processing. And now to Orica Monitor, in particular GroundProbe. The demand for measurement and monitoring systems that improve safety, productivity and cost for miners has been growing at pace. Observing this emerging trend Orica acquired GroundProbe back in 2017. GroundProbe is a global leader in critical geotechnical measurements and ground stability monitoring. Now ground stability or slope stability monitoring is important as unforeseen collapse has the fatal potential to harm personnel to damage equipment and to disrupt operations. GroundProbe's radar systems, predictive algorithm and monitoring software detects wall movement, understands when it might be a problem and determines when a collapse is likely to occur. Reactive technologies detect, track and alarm on moving geo hazards in real time giving our customers and communities advanced warning of a breach or collapse. The technology is increasingly being adopted in tailings dams monitoring to support environmental and community expectations around those facilities. And with growing growth in radar volumes expected, we've commenced planning on a second manufacturing site in the Northern Hemisphere, which will help us reduce the landed cost of production of these units. For Monitor IQ, I'd now like to talk about our data aggregation platform, Monitor IQ. The sites are deploying huge amounts of sensors that are gathering different information, including but not limited to just blasting measurements. All sensor information is value, but can be cumbersome to manage individually and are often in a disparate form. So Monitor IQ aggregates, automates and standardizes all of the data collection and visualization. We're also now working to broaden and integrate Orica monitor sensors and software suite into our Orica Digital Solutions end-to-end workflows. And this will be truly an end-to-end service offering for our customers. So here's a video showcasing GroundProbe's range of products and services. [Presentation]

So having presented the elements of our digital strategy and the strategic rationale. I'd now like to turn to our commercial playbook and the strategy for growth. And this is really centered around 3 pillars. The first pillar is maximizing the core. And this is about exploring and leveraging Orica's global footprint to engage existing and non-Orica customers. We remain true to the open platform concept, which we started from day 1, 5 years ago. And we have now many of our Orica Digital Solutions deployed with non-Orica explosives companies. And that independence is really important for us, both as a stand-alone offering in the eyes of our customers and also to maximize the growth potential of these technologies. Pillar 2 is about exploring new technology. And as we -- so as we penetrate the market with our current offering, we're also continuing to invest in research and development and we're bringing out new products to the portfolio in underground mining and quarries and construction markets. In addition, we'll also be rolling out some new capabilities in the ore body intelligence space, which will leapfrog the existing offering. And then thirdly, there's inorganic expansion. While we leverage our in-house software sensors and data science, we're also actively in pursuit of targeted technologies and market position through acquisition to accelerate our digital solutions offering and to create more end-to-end workflow models. I'm really confident about this approach and our success -- given our success to date. The graph on the right illustrates the high growth as we've had in the last 5 years. We've been achieving year-on-year more than 100% growth in customer adoption, and we're now over 275 sites were customers using one or more of our digital solutions products, either as a discrete product as or as a connected workflow. Our business model for this is largely Software as a Service, as I mentioned earlier, and we have a tiering approach also through bundled and then outcome-based contracts. We have a healthy pipeline of customers, and we have great retention metrics, and this number continues to grow year-on-year. So the Orica Digital Solutions strategy is delivering high-growth, high-margin products and services, and end-to-end workflows across mining and beyond blasting. The Orica Digital Solutions environment is open secure and an integrated system providing full flexibility and a common space for collaborative work. It's also now a comprehensive offering, extending well up and downstream of blasting again, as you can see illustrated on this slide. It's an extensive coverage of products and it's not just in blasting. Now given our position as the market leader in blasting, Orica is well positioned to be a leading integrator of these end-to-end digital workflow. Blasting is a critical point for value determination for our customers, which creates a unique opportunity for Orica to provide real-time measurements and insights that can drive quantifiable benefits. And this gives us the platform to move beyond blasting. The position combined with innovative and market-winning digital products is behind the success of the overall program to date, and we're just getting started. When miners can measure the value of their decisions, they can start to close a continuous improvement loop to further drive safety, productivity and sustainability outcomes. Thank you. And I look forward to hosting many of you tomorrow at the [ Karakuri ] site, where you'll get to see look, touch and feel this technology for yourselves. Thank you very much. And I'll now pass you off to Adam Hall, who's going to talk about mining chemicals. You're going to do the intro.

Thank you. Before we get Adam back on again to talk about Chemicals, let's have a quick kind of video that showcases how the manufacturing of sodium cyanide at Yarwun. Our global distribution network and unique products and services, how they come together to deliver value and safety for our customers around the world. It's a significant competitive advantage for Orica. So let's have a look at the video, and then we'll get Adam back on to give us an update on chemicals. [Presentation]

Thank you, Angus. So we say the best vertical for us with mining chemicals. It's been a much beloved part of the Orica portfolio, but one that we haven't had a chance to talk about in the past. And today, we'll shed a bit of light on it. A small addition to my background from before. Before coming to Orica, I actually spent 6 years at CF Industries, which is the world's biggest nitrogen manufacturer which gives me a rich appreciation for ammonia, one of the key feedstocks in cyanide, which we'll be talking about today. But first, why chemicals? And we think of it as 3 reasons. In Orica's portfolio, gold miners are the largest part. When we partner with them across the value chain, we're able to bring them obviously the ore body intelligence and the blasting. But we can also bring them the refining, and that's what we do with the cyanide. So that presence across the value chain helps us be the partner to clients -- gold mining clients around the world. Why can we do that? We can do that because we're already present everywhere the gold miners are. We're used to bringing difficult commodities, [indiscernible] and detonators to their locations on a reliable basis. And by adding cyanide to the mix, it's another way of helping to understand and fulfill their needs. And then finally, we have a series of complementary components to these solutions offerings. When we sell cyanide, it's not as a commodity product. It's not selling a [ fob port ], and that's the end of the story. Rather, it usually comes with a safety training or our product suite, which we call Pro service, which measures -- has software and sensors to measure the cyanide presence in the cyanide circuit as well as the performance of that circuit for the client. And even when emulsifiers, we'll sometimes tailor our emulsifiers to a particular country or even to a particular mine site in order to better serve the client for the solution that they need. So a very exciting part. But maybe the question is, how big is the price? And on the next page, you can see not just cyanide and emulsifiers, but the rest of the mining specialty chemical market as well. Starting with cyanide. This is obviously our biggest product today. It's a comparably big market. As you're probably familiar with, it's a leaching agent that you apply to refine or to get gold. But in addition to emulsifiers. Emulsifier is a small but mighty part of our product suite, a profitable part that allows us to really differentiate our explosives. And I'll take you through that in just a few moments. I'll spend just a few moments now on the rest of the growth opportunities. Those first 3 bars, collectors, frothers, flocculants, they come together in a flotation circuit and many mines run on that basis and use all 3 in order to get their ore into metals for market. In addition, they're solvent extractants. And that's an alternative pathway outside of the flotation circuit that customers can use. We see all of these as potentially interesting for Orica. These are all big fields. There's different chemicals and by-commodity that apply in each. But each of them has something that we potentially could partner or bring to our clients and something that we'll be looking to across the course of the next 5 years or so. But as that has been stated, Cyanide is our single largest product. And you might want to understand a little bit more about the drivers in cyanide. If we go to the next page, you can see cyanide demand and supply. Starting on the far left-hand side, gold production, you can see it's written down there at a modest 1.6% growth rate. This is not too conservative, but neither is it the inflation gold bull case that sometimes gets put forward. So we put forward a sort of 1.6%. That seems very reasonable to us across the course of the next 5 years. But what's interesting is that 1.6% translates into 4% in terms of global cyanide demand. And that's because [ although ] ore grades should hold each year, the ores get more complex, each year, there's more sulfides and copper in the ore system that -- and those sulfides and copper, it takes -- you need to use more cyanide to extract it. Similarly, often, if the ores get harder, you grind them more. As you grind those ores, you get those finer grains of ore that pass into the circuit. That means more surface area, which means in turn, more cyanide. So we see cyanide again, with some pretty moderate assumptions growing at a multiple of the global gold ore demand, which we're pretty excited by. Now on the other side, you can see the supply side. And in general, cyanide supply side response is pretty slow. The global industry utilization is already at about 90% and new developments are hard. So for a greenfield project, there's significant regulatory challenges. Now I personally would love to have the industrial poetry of Yarwun in my backyard. It's a beautiful plant, and you'll see it in a moment. But that's not a universally held belief. And if people do not want to cyanide a plant in the backyard, that tends to restrict where you can construct them. One of our major competitors, very publicly identified a location, bought the kit and was unable to deploy it for 5 years because the local community did not see the aesthetics of that plant. In addition, there's a multiyear construction time for brownfield, and brownfield is more complex, I think, for cyanide because of the challenges in safety. You, of course, don't want any leaks in brownfield process. The other thing probably to draw your attention is a comparably small number of technology providers. There's certainly less than 5. And each of those technology providers is also a player in the industry. So over time, that will tend also to minimize the number of facilities. As a result, there's a pretty strong correlation between cyanide price and industry utilization. Why is that? Almost all cyanide producers sell to clients on our formula and the formula is the 2 major feedstocks. So the publicly observable index for ammonia -- price index for ammonia multiplied by a usage factor, the publicly observable price for caustic multiplied by usage factor plus [indiscernible]. And so you're passing through those fluctuating raw material costs to client, and that add-up represents effectively a payment for the use of your capital as well as to cover the fixed costs in the plant. And so with that formula-based pricing as well as this S&D construction, it suggests a comparably supportive price environment going forward. With cyanide being low, low single digits, of a gold minus spend each year. It's not something that will tend to change the demand profile. I'm not going to say that -- the price is unresponsive -- excuse me, demand is unresponsive to price, but I'd say that it's just not the most important thing for miners to focus on and really rather be driving that productivity and getting as much gold out of their facility as possible. So that's the background on the market. What about Orica? And one of the fascinating things about Orica is this Yarwun plant, as I mentioned. It is -- it's in the top 5 plants in the world, but it's also the most export-oriented. Many other plants are devoted to nearby gold mines. So in many of the big gold mining regions in the world if there's a cyanide facility, it's really oriented to serving just that facility. Yarwun exports a majority of its output. And we do that and using that Orica network around the world. So the fabulous relationship that we mine as everywhere enables us to talk to them about cyanide and then bring that Yarwun cyanide to [indiscernible]. Freight, a comparatively small cost for a small part of the overall cost base and would be -- and they face a similar freight cost from many other providers. So that doesn't inhibit us from selling Queensland tonnes almost anywhere in the world. The other thing that, of course, helps us is our wonderful sparge network. And you can see them on the page there, going from right to left, Malaysia, Ghana and Peru. And each of those allow us to receive the [indiscernible] kit from Yarwun, load them into a reinforced tank and then shift that as a tank to the clients who then run liquid through it in order to get a wonderful solution that goes straight into their circuit. It protects the environment in transit, it protects the humans at destination. And we've got about 25% of our volume in sparge and customers love it. The other thing to point out here is this operational leverage because we have this global position, because we have this wonderful access to miners around the world, we tend to understand what's going on in the market a bit more. That gives us we're able to construct better supply chains, better freight management, including charter vessels as needed and able to have those -- that global network of experts being able to help the clients. And you can see where that all comes together at the bottom there. We serve customers with [ liquor ] cyanide. That's really just nearby Yarwun because it's sort of a short-haul product. With [indiscernible] and as I mentioned, with sparge. And each of those is usually accompanied by services. So a client will want a process health check or training for their staff or an analysis of their circuit performance as part of the engagement with Orica. And we're delighted to provide that. We think this is a hazardous good, and we want it to be treated carefully around the world. The -- so what are the opportunities from here? And there's risks and opportunities, the risks probably comparably intuitive if there was to be a slump in gold market that would obviously have a sharp impact on cyanide. And likewise, acrylonitrile. So acrylonitrile is a chemical used in fabric, traditionally auto fabrics. And the byproduct of acrylonitrile is hydrogen cyanide. And that hydrogen cyanide molecule, you can do several things with and the most popular is to turn into MMA, which is another popular molecule. But there are some plants that manufacture sodium cyanide as a byproduct. And that sodium cyanide as a supply base is pricing different. They're going to make that sodium cyanide as long as the acrylonitrile is running rather than depending on the sodium cyanide price. If acrylonitrile was to take off, we don't believe it will, but if acrylonitrile was to accelerate further from where it is today, that would obviously have an impact on cyanide price. And substitution, cyanide attracts a number of substitution discussions. But it's really commercialized. There's 1 major mine that has switched away from using cyanide into a different reagent that costs them north of $100 million. And our understanding is that they would not necessarily do that again. That particular mine site also had a lithography that will lent itself to this alternative reagent. And so even with everything going for the alternative, it was still a mixed bag in terms of switching away from cyanide. So substitution absolutely has a potential, but it's been talked about frequently and never come to pass. If I turn to the opportunities. Let me start with sparge growth. I'd like to think that because we have constructed, operated, served clients from these wonderful sparge stations around the world, we've got the right to grow, and we continue to talk to gold miners in new locations, about constructing sparge stations to serve them. And I could see that as being a comparably low capital investment in order to drive out our network growth. The next step up in terms of capital discipline would be a plant expansion and Yarwun has a terrific opportunities around brownfield. It's something that we continually look at. We grew recently by about 9%. We'll be looking at that again and looking again for a high single-digit, low double-digit growth in capacity there as well. And then inorganic. So from time to time, cyanide producers come to market, it's something that we take a very careful look at when it happens, but again, a disciplined approach to opportunities there. If we go on the -- this is cyanide, but what about emulsifiers, that's small but highly profitable part of our portfolio. So let me start on the left-hand side of the page with just what emulsifiers are there the special dispersion and stabilizing element in an emulsion. So the emulsifier combines the [ AN ], the fuel oil, the water in a way that helps them all harmonize and be consistent in the deployment of the client side. The way you make an emulsifier is you buy PIB, which is polyisobutylene, and then you transform it into PIBSA after combining it with maleic anhydride. And that, again, with some [ amines ] and some other oils allows you to produce that emulsifier. Many people actually don't buy the PIB, they buy the PIBSA, which is compatibly small market for in order to make their emulsifier. I think part of Orica's unique position is having that vertical integration, having purchasing PIB, making the PIBSA, and then driving that into emulsifier. What do you use it for? On the right-hand side of the page, you can see how the emulsifier is often the secret source in an emulsion for many miners. It helps you -- he helps you with viscosity, helps you with retention, all of which are absolutely critical to success of the client side. Our customers are all explosive service providers. We'll sometimes sell to industrial customers as well, but not as a priority. And they frequently -- the emulsifiers need to be tested and qualified is a long selling process. But once you've achieved it, those customers are sticky. They want to stay with you because they qualified that substance. They want to use it and keep their operations running. The competition, some other explosive players make their own emulsifiers. However, as I've just mentioned, they're not generally back integrated to PIB. They usually buy PIBSA and that gives them a cost disadvantage or the global lubricant manufacturers who are delighted to make these, but have no knowledge of miners needs and no attention paid to the sorts of characteristics that are needed from the product. So what's our -- that's the chemical, but what's our role. We're very fortunate to have 2 wonderful plants. In North America, we have a long-term partnership with a group called Nelson Brothers. And as part of that partnership, we have a 50-50 ownership of a terrific emulsion plant -- excuse me, an emulsifier plant in Parrish, Alabama. And it's logistically advantaged. It can serve all of North America and conserve South America as well with overflow capacity. Being in North America, it's PIB supply is back to Henry Hub. So it's got a great cost advance -- great cost position there. And something they've got a team of scientists on site, continuing to develop features around this product. That's just a wonderful opportunity for us. Turning to Deer Park. So you might be surprised by this, it's a cost advantage plan in Melbourne. And the reason for that, again, it's actually got scale. It's one of the biggest mining focused emulsifier plant in the world, and it has an access to the Asian PIB market. There is a live market for PIB in Asia. As a result, Orica able to buy at really competitive rates bringing into Melbourne, transform it in a scale facility into a great product and then ship it across the world. And you can see all the places globally that we ship through there. So again, comparably small volumes, but a really interesting chemical for Orica. But what's next? And on this last page, you can see our opportunities to grow. And again, going from left to right in terms of capital deployment, first adjacencies. There's a real opportunity for us to expand the emulsifiers chemistry, look at alternative cyanide delivery models or cyanide services and really grow in that way or ultimately use our existing logistics assets in order to handle other chemicals as well. Those -- that's sort of the first step in the journey and something that we're excited by. The next is partnerships. And this is where if there's a byproduct or a comparably a small value stream coming out of an integrated facility that can be used to serve miners, some of the other big chemical players have approached us to potentially partner with them to handle that chemistry. And you could see the partnership there ranging from are correcting as an agent all the way through to an offtake agreement all the way through to Orica purchasing the by-product production unit at a particular integrated facility. That's pretty exciting. And again, our value that we would bring there is this deep understanding of what the miner needs and how we can deliver against that using the chemicals -- or excuse me, using the products that are produced. Then finally, inorganic growth and adding extraction chemicals to our capabilities, probably the best way to think about this is in hands of a large chemical manufacturer, the mining slice of their portfolio, comparably small, comparably uninteresting, uncorrelated with the rest of their output. And so they don't invest the time. They don't invest the bandwidth in understanding the needs and driving value in that business. However, in Orica hands, we absolutely want to drive that business, and we want to use our global footprint, our relationships to maximize the value of that business. We could do that also at a bolt-on level as well. So we see many opportunities to grow ranging from capital light to more intense, we'll be, frankly, developing all of them and bring them to market as we see those value-creating opportunities. But for now, let me hand over to , I think, is Delphine to take questions, but I look forward to your thoughts.

Thanks, Adam, for that very energized presentation. Thank you. We'll take questions now or the Digital Solutions. And Adam, if you can just wait on the line for Chemicals too. Let's start with questions from the room. Please put your hands up higher so we can get the microphone to you as quickly as possible. We've got one here on the left.

Richard Johnson from Jefferies. I've got 2 questions on cyanide, if I may. The first is, Adam, there's been significant structural change in this market with the checks making acquisitions in the U.S. and South Africa and here in Australia. So I was just wondering if you could make a comment on your thoughts around that and what your thinking is around what that could do to general returns in that market with the supply side consolidating the way that it is? And does that mean that you've kind of missed out on the inorganic growth in cyanide? And then secondly, there's been significant cost pressures in Europe and there've been reports of production curtailments of cyanide in Europe. I just wanted to find out whether that's still going on as far as you know and the impact that's having?

Great questions. Let me start with the second. So the European energy costs sky high, a challenge for many, many producers. The most -- the sort of couple of what you might call old world European producers are -- as we understand it, use some output to mining, but also some output to industrial chemistry and ag chemistry. As a result, even with the higher energy prices, even with those plants either running slow or coming down, the impact on the mining side has not been as large. Those 2 plants also not the largest in the world that are coming off. So I would say, a slight impact. And if you look at sort of global map, where we might intersect with them, you would look to the Middle Eastern sort of region. In that Middle Eastern region, we have seen sort of less presence from them, but I wouldn't describe it as a tectonic shift in sort of the global S&D at this stage. Let me talk back to the other question. You're asking about 1 particular competitor and several moves that were made that they've announced. I'm going to say, in general, I think that Orica is reluctant to become a tenant on our landlord side. I'm thinking of South Africa there, that's a difficult position to be in to not control your own destiny, particularly if it's a different chemical process than one we're used to. The -- and in terms of the United States, the U.S. is a very big market -- excuse me, I should say, North America. North America, a very big market. Mexico, the largest sort of side market in the world, plenty of opportunities for many others to participate there. The theme of consolidation, though, I think, is fair. I think that -- but I think we're sort of probably at the early stages of that in global cyanide. So I think plenty more chapters to come. Delphine, Sanjeev, you may have additions to that.

No. I mean, Adam, you said, look, Richard, we've been very, very disciplined in terms of where we invest capital, and we'll continue to be disciplined. We are one of the pioneers in this industry. We understand the technology. We understand the strengths and weaknesses of what's out there. And core dependencies are very, very important in this business and the fact that we have a fully integrated site where we produce this particular hazardous and very difficult to handle chemical, gives us unique insights into what the rest of the industry does. And we'll obviously leverage it. And whenever there's a discussion of consolidation in industry, Orica will always have a seat at the table. But Orica is also happy to walk away where we see challenges, whether these are environment-related, sustenance related or in general, in terms of market outlook and dynamics. Now the mining chemicals market is much bigger than cyanide as we've tried to elaborate today. So there are so many fantastic opportunities out there given that it's a portfolio and chemical industry, which is not really understood, right? It's kind of a core business -- side business that's operated. We have a lot of opportunities, and we need to be very careful and focused as to what we really want within the portfolio in terms of our offering and where we see potential for future growth. So we continue to explore. And -- but we'll be extremely, extremely disciplined given the operational experience and background we have in that business.

Thanks, Sanjeev. We've got a question, Scott.

Scott Ryall from Rimor again. Angus, this maybe hopefully a quick one for you. Could you comment in terms of the customer base that you're looking at implementing these solutions. What is their digital capability to be able to utilize your solutions? How far along the path are they -- and I guess what I'm after is, if you could just give a rough percentage penetration of customers that are digital ready enough to utilize your services and maybe by geography, if that's an easy thing to do?

Yes. Look, it's -- and the short answer is it's a really broad range, as you would expect. Some of our customers are really quite sophisticated. And I think it works 2 ways really. One is there's an opportunity where there's a fairly low level of sophistication to provide digital support through the Orica offering. And where we are working with sophisticated customers, we're able to integrate quite effectively. I'm not going to give you a percentage because it's evolving and growing very quickly. What I will say is we took a decision last year to align a strategic partnership with Microsoft around our digital solutions business. And that was quite a deliberate strategy to work with Microsoft on a common data platform, and this gives us really a far more seamless integration with customers regardless of their level of sophistication on the digital side and readiness. Obviously also it takes -- manage some of the security concerns and whenever you engage with any partner on digital technologies and the use of data, the question around cyber and security comes into play. So we view that partnership is quite important to allow that ease of integration in the industry.

Andrew?

Andrew Scott, Morgan Stanley. Sanjeev, just a question for you. We've heard a lot about technology in these forums over a number of years. And to be frank, we've probably never seen it really evident in the earnings. Right or wrongly, there's been a view that maybe this was loss leading to win the next contract or maybe it helped on share. How do you and how should we judge this business, whether it be from a return hurdle or a profitability hurdle? And how will we actually see that come up in the numbers?

You're right. Technology offerings from Orica were sometimes a cherry on the cake. And in a lot of cases, were given away in the past. And -- when I came in last April, I talked about a dedicated techno-commercial team who runs the P&L responsibility to commercialize and scale up technology that sits with Angus. So he runs the P&L. . Angus you want to talk about your technology commercialization team and how they are operating today?

Yes. I think it's a great question. It's a question we field a lot. And I think the thing in mining is that it's a long life cycle of technologies, which accounts to slow in and also slow out. I mean if you look at electronic blasting systems, it said its 20th year now. And that introduction phase, taking things from the lab to a commercial application is difficult in any industry. It's particularly difficult, I think, in mining, remote locations, the scale of things and operations to be able to integrate and there's a lot of change in management. So as Sanjeev alluded to, we stood up last year, a dedicated commercialization group. And this takes the technology from the lab space and works with the regions, work with customers, and we've resourced that to be able to bridge that void. And I think in terms of going forward, there's a question of scale, and we're at a really important junction now where we're starting to deliver scale on WebGen, delivering scale on 4D and particularly the digital technologies, which have come very quickly, scaling quickly from middle things, big things grow. We've got -- it's very high margin. It's very high growth. And we hope to be in a position next year to be giving you a better line of sight on the digital solution suite of products.

To put it brutally today, each service that Angus' team develops in the labs and with the coders and brings to the market has an independent SKU in the 4S system. And there is no capability of the very smart commercial people we have to give it away. There's a price tag to it. Each product and each service that we have is hardwired into the 4S system, and it cannot be given away even if they want to. And if they would like to give something away for free, they have to come to Angus or Chris Davis or myself for approval, and you can imagine how many such requests we received in a year. I don't remember the last one I got to give anything away for free. So -- and the other data point is that -- and I think Angus talked about it, we have digital services operating on sites where we do not do blasting, somebody else does it. But they use our digital platforms. So those products are appreciated. They have fantastic value, and there is no intention to give it away for free at all.

Just on that point, Sanjeev, Blast IQ in India has been a digital-first offering for us and for a number of clients.

I'll just take a couple of questions from the line. There are 4 there. I think we've answered 3 about monetizing technology and the client adoption. But I think there's 1 here, for you Angus would say there were still large independent GMP software suppliers in the market. What are the primary benefits of acquiring versus partnering with them?

Yes, that's a great question actually and 1 that we actually bet around quite a bit. And that software market in the mining space is actually quite fragmented. I mean it started almost as a cottage industry with niche applications. It's consolidating, but it's still quite fragmented. I think that we would certainly be open to partnerships as well as acquisition. I think certainly, valuations have been quite high, and that's come off the boil a little bit of late, which makes the space a bit more attractive. But we wouldn't rule out partnership. It's an important space, particularly the planning and scheduling portion of that software business. We talked about quantifiable benefits and having the capability to do better blasting or having the capability to do things having generated insights needs to translate to action. And so obviously, we master our own destinies when it comes to things like blasting, but the ability to deploy through so planning and scheduling also helps monetize the value of the information or the better blasting. So it's an important space for us to be engaged with, and we would certainly be willing to look at partnerships as well as acquisition.

Can I just add one more to that, that's just popped up. How do you compare to your peers on the tech platform and solutions?

Well, I can only talk to what Orica does. And I think we've -- you've seen from the prior investors show and the one here that we've been quite strategy for some years. We've committed through the investment cycle. I think we have an unrivaled position not just in and around blasting, but now also integrating upstream and downstream of that. So I'm very comfortable in our position. And we're doing what market leaders do which is lead, and I'm looking forward, not back.

Anymore from the room, there's one online for Adam. When will these new mining chemical sector to start delivering double-digit million EBIT?

Okay. So maybe 2 pieces there. The chemicals that I outlined today, cyanide and emulsifiers are a very healthy part of Orica's overall EBIT, a very meaningful contribution to our performance. And so it's part of the reason we're so thrilled to be talking about them a bit more today. The -- if there was to be a -- in terms of new chemicals and new avenues, my guess is a meaningful change there would be marked by capital deployment, which in turn would be an announceable event. So stay tuned on that front. Partnerships, I would regard those as incremental on the side as we learn more about this industry and develop more. But Delphine, do you think I interpreted the question there correctly in what I address?

I think you are fine.

Maybe the one thing to just emphasize. The 1 thing that we're thrilled about for chemicals in the Orica portfolio is the quality. It's a sticky business [indiscernible] one of these customers, we tend to work with them for a very long time. They love working with us. We love working with them and the margin is generally, as I said, you pass through the raw material cost and then there's an add up contribution from your capital. So it's something that we're happy to do.

Thanks, Adam. Are there any other questions from the floor? We've got one at the back. Thank you.

Nathan Reilly from UBS. Angus, I'm just curious, just in terms of the realities of cost inflation in the mining market at the moment. How does that impact your growth aspirations, your conversations with customers or adoption rates? I mean, clearly, you've got a solution that offers efficiency benefit, but also an energy cost or reduction benefit as well. But I'm just curious how that conversation is taking place in an environment where cost inflation is such a significant issue for your customers?

Yes, I'll deal with it in 2 parts. I think first of all, on the digital solutions side, this is software senses data science. So particularly from a software and a data science perspective, we are less prime, obviously, to some of the inflationary issues in hardware and also some of the logistics challenges, which is also driving that inflationary cycle. And we saw that through COVID. There was a lot of COVID disruptions to technology introduction programs and we're able actually to continue to ramp and scale quite quickly on the digital products because it was more easily moved. So I'm not overly concerned about the inflation side on the digital technologies, I think perhaps on the people and capability side, there's some more pressure there. There's a real fight for talent, obviously, in the tech space, and we're no different from that. But we are able to attract talent because of the progress that we've made. I think on the hardware side, it's very similar to the challenges we have across all of our products. It's about making sure that we have the right commercial discipline and that we have the right commercial instruments in place to be able to pass through those inflationary costs.

Thanks, Angus. One more. I think this will be the last one for the session.

Sorry, it's more a question in relation to how the cost inflation of your customers is impacting the demand for your services and outlook for your growth aspirations?

Yes, at this stage, from a technology perspective, I'm not seeing any doubt in demand for those products. In fact, where we can help create efficiencies and drive more efficiencies, then there'll be a stronger pull.

Okay. Thank you. Thank you all. Thank you, Adam. Thank you, Angus. I'll call Leah Barlow to give you an update on supply manufacturing.

Just give me a second. My voice is not doing well today. So good morning, everyone. It's an absolute pleasure to be here today with you all. My name is Leah Barlow, and I was appointed to the role of President of SHES Manufacturing and supply this year. I've been with Orica for over 17 years in numerous manufacturing roles. I actually started Orica as a graduate. And I've worked in both the continuous manufacturing, the fabulous cyanide plant that Adam alludes to, I worked a number of years there and also in our AN and discrete manufacturing fields across more than 20 countries globally. Prior to my current role, I've just moved back from Montreal, Canada back to Melbourne. And I've got global responsibility of our discrete manufacturing network and I'm also responsible for the strategic implementation of the network optimization program and also the SKU rationalization. So Thanks, Delphine. It's been well documented the supply chain challenges that we had. This is not new. But what does this impact mean for Orica? Well, actually -- this actually represents a unique opportunity. We have a wonderful portfolio of plants and network to make sure that we assure security of supply to this organization. This includes activities like strategic ship chartering. We've accelerated local electronic blasting systems, assembly local to the customer and also leveraging our AN partnerships that we've had and supply network in order to introduce new capacity into the market and support the quality of earnings at each region. Just a bit of a quick snapshot of our supply chain. Orica has over access to over 3.9 million tonnes of AN globally through our preferred supplier partnerships and also our 5 continuous manufacturing facilities globally. Orica has increased its internal manufacturing capability of electronic blasting systems to over 18 million units. And we've got projects in place to implement further growth over the next 2 years. And most importantly, and I think often undervalued is that we have established important export capability to over 75 countries, which has allowed us really that flexibility to make sure we don't disappoint customers. I'm extremely proud of our team. It's been difficult. Our teams worked 24/7 to make sure that we never let a customer down in these trying times, and it's really this reliability that allows our commercial teams to demand value from our customers. Next slide. So this is a map of our network. And if you talk to me in the break, you'll know that I'm very passionate about Lean manufacturing. And this is a network that's continually optimized based on Lean principles. We continue to optimize this network to operate, and it's actually operating on a hub and spoke model. And this is done to reduce our lead times, allow lowest cost and delivery and reduce into regional transport. Our global manufacturing centers in each region, combined with our strategic distribution center locations, which you'll see in the blue dots on the screen there, actually, which are close to our customers, allow us to manage our supply chain in the most effective and efficient manner. And this is coupled with our backup sources and supply and offers unparalleled reliability and now security of supply. Next slide. Now to AN and our continuous assets. And I must emphasize this reliability and flexibility of these continuous assets is absolutely key to delivering on our strategy. I'll start firstly with flexibility. We talk a lot about where we got our AN from. For me, when we look at our AN, we need to look at our network. And we've been able to capitalize on our network by unlocking what I would say, our AN facilities or in -- sorry, our domestic and our export capabilities. And we've talked about that. Germán has talked about that in regards to improving switching from Nitropril to [ Anapril ]. So we can send that to more melt facilities. We've also done that by increasing our bagging capabilities on site to ensure that we're always maxing out the capacity of our plants. But further to that flexibility, we're also pursuing to invest in a new 30,000 tonne ammonia tank in Kooragang Island, to optimize our ammonia network on cost on the East Coast and to deliver improved reliability and supply security. This is also a key enabler for potential green ammonia value chain at KI. Chris will talk more in detail regarding sustainability actions we are implementing on our AN facilities to decarbonize our continuous [ plans ] and make sure they're future-proofing our assets full. But the other area is about reliability. Orica's investment on focus on improving maintenance and turnaround execution has reduced unplanned downtime over the last few years. Our teams have been invested and really improving our capability to deliver turnarounds on time and on budget in very trying circumstances. The key to this is really around optimizing our turnaround cycles. So what does that mean? That means making sure that we understand what are the drivers for the turnaround and making sure that we do what is minimally required to assure license to operate, but also make sure that we sustain reliability for the future. And the other key area is around maintenance execution. An example of this is 4 out of the 5 last turnarounds were delivered within plan with the exception of Carseland that had some delays to the schedule due to start-up issues with the expander. These will actually be addressed later this year. As [ Newchan ] go into a shutdown, we're going to take advantage of that to rectify those issues and work together. The other part of the business is around discrete manufacturing, and we are well advanced on implementing our discrete network optimization strategy at Orica. The fact that this program was well advanced prior to the pandemic and those supply chain issues has actually been -- allowed us to efficiently assure security of supply to our customers where others haven't. Some of the critical milestones, and I've mentioned it before, is accelerating our capacity increase of electronic blasting systems. Primarily, we've done that in Latin America, and we have plans to move into several other regions in the next year. And we've done that by really looking at a fished hub and spoke models where we can pick up that technology and move that to remote locations to make sure we're close to the customer and be very agile. The other part of it is the implementation of the SKU rationalization program. And this has enabled us to have increased utilization of discrete manufacturing assets in our network. We've reduced our SKUs by 40% in the last 2 years by transitioning customers to premium products and optimizing our product families. The other critical enabler to our optimization strategy is the development of Lurin in Peru and Gomia in India as our global discrete manufacturing hubs. Lurin manufacturing site, which was part of the Exsa acquisition and for people that have been in these processes for a while. The Lurin technology is the best discrete manufacturing technology I've seen, and I've been in this industry for a long time. And it is about how can we leverage that by introducing the full suite of bulk emulsion, packaged emulsion and discrete manufacturing products, which we've done. Lurin can now make the same quality of -- and standardization range that we've got in all our other customers -- or sorry, all of our other manufacturing facilities worldwide. The other aspect is we've enhanced our product quality. And we've also enhanced the efficiency of that area to continue to improve its utilization. I just recently got back from Peru a few weeks ago, and the site has been doing extremely well in making sure that we've got the right people and the capability to deliver on our promise. The other area is Gomia in India, and we've just introduced the standardized Orica timing range, and we're now exporting our detonators into EMEA, Asia and AusPac from that plant. Excuse me for a second. And as Sanjeev mentioned earlier, Orica's competitive advantage as the market leader is about making sure we leverage our scale, scope and reach. And a few examples of that is leveraging the new SAP system. We've been able to do that. We've now -- can see all of our processes and products and manufacturing distribution centers worldwide. And we've done that to make sure that we're optimizing our delivery on time and on full to our customers, but while also optimizing our efficiencies. Other examples of that is the global freight network. Adam mentioned that about the opportunity for mining chemicals and cyanide. We've actually brought in time charters to be able to export cyanide out of the Yarwun site, maximize that utilization and also bring that across 2 numerous countries worldwide. The other piece is around partnership and leveraging our scale. We've been able to strategically partner with AN suppliers as well as discrete manufacturing suppliers worldwide, and that strong partnership has been able to overcome some of these supply challenges. A good example of that is we had issues with the resin suppliers out of Texas, and we had a shortage of resins for 12 months. And that is a key product into our conventional IS, and we've been able by second resourcing, applying and flexible manufacturing technology to weather that change and make sure that we don't disappoint our customers. And lastly, not least, we're actively working out with our suppliers to help them manage their Scope 1 and 2 emissions, which in turn help manage our Scope 3 emissions, and we've done a lot of work to really baseline and work with them to improve and make sure that we're not just looking about the here and now, we're securing our future in supply chain and manufacturing. So how will we measure success? I've tried to be as exciting as Adam, but really it comes down to safety and reliability. That is how we measure success in manufacturing and supply chain and also by ensuring we have high plant availability, supply reliability, and that is our competitive advantage. And as I said, I'm passionate about Lean. It's all about continuous improvement. I'm never satisfied with where we are. We need to improve, and that is around optimizing and growing our manufacturing network, globally to support our customers and making sure we're agile and we listen and we can make sure that we never disappoint. Thank you very much.

Thank you, Leah. Before Chris joins us, we just wanted to talk about sustainability. We'd like to share a final video which summarizes one of our key sustainability initiatives at Kooragang Island. Leah just mentioned that. Having already successfully installed the technology at our Carseland manufacturing plant earlier this year, we've now partnered with government to reduce KI's greenhouse gas emissions by installing an Australian industry-first tertiary catalyst abatement technology, and that will be happening towards the end of this year. The technology is designed to deliver up to 95% abatement efficiency. It will help us accelerate our progress towards achieving our 2030 emissions reduction target and our net 0 ambition by 2050. Chris, over to you on sustainability. [Presentation]

Thank you, Delphine, and good afternoon to everyone. I'd like to start the sustainability session by turning to Slide 85 entitled Sustainability strategy. It is fair to say that over the past 3 years, Orica's commitment to putting in place sustainable business plans and practices has gone from an emerging priority to be at the very center of everything that we do. This has been less in response to external expectations, but more a growing awareness within Orica as to: firstly, the central role sustainability plays in our purpose, namely to sustainably mobilize the Earth's resources; secondly, the critical responsibility we have in decarbonizing the mining supply chain in partnership with our customers; additionally, the long-term and value-creating opportunities presented by a decarbonizing economy. And given our footprint across more than 100 markets, the tangible role we can play in addressing community concerns on issues like antislavery, minimizing environmental impacts and respecting human rights. The consideration of sustainable business strategies and actions is ever present across both our Board and management's agendas. We are also broadening the discussions to third parties and governments and exploring critical collaborations to ensure we meet our objectives in this regard. Today, I want to share with you some insights into our approach and thinking and provide an update on a number of initiatives already underway that demonstrate Orica's commitment to sustainably mobilizing the Earth's resources. If we turn our attention to Slide 86 entitled Sustainability Leadership. As you would expect, our unwavering commitment to the safety of our people and communities remains our highest priority and sets a high standard across the business for the management of Orica's other material sustainability risks. To this end, we have established an internal sustainability and climate change committee to further encourage cross-functional collaboration on emission reduction initiatives across the business. This forum shapes the planning, resourcing and capital allocation needed to deliver on our sustainability commitments. It will also continue to drive a management mindset across the business that applies a sustainability lens to every material decision that we make. We have also extended the criteria for executive remuneration to include key sustainability metrics covering emissions reduction and diversity. Alongside the targets disclosed in the Orica annual sustainability scorecard, these priorities are then cascaded down into the business. In doing so, we are sending a strong message from our leadership to our people on what our focus must be, what our expectations are and where accountability sits. We have also placed a high value on transparency with our external stakeholders. Our commitment to aligning with the reporting demands of the task force on climate-related financial disclosures is unchanged. And both the Orica Board and management team have been working towards meeting its criteria for several years, including our first integrated reporting suite in last year's annual report. By so doing, our external stakeholders can continue to assess our progress and provide feedback on our actions and priorities and performance. It is pleasing to see that our work is being recognized. And in turn, we believe our investments in sustainability are emerging as significant engagement points with our people, our customers who see Orica as leading in this area. Importantly for us, this is just the beginning, so watch this space. Moving on to Slide 87, entitled Sustainably Mobilizing the Earth's Resources. As you would expect, given our status as a heavy emitting global manufacturer, our approach to decarbonization places a strong focus on reducing our Scope 1, Scope 2 and Scope 3 emissions. This commitment is shared across the mining sector, and we believe Orica is well placed to play its part in reducing its footprint and net of our major customers. Our climate strategy is underpinned by 4 key pillars. The first pillar is planning for a transition and acting and investing in anticipation thereof. As Sanjeev has already mentioned, as part of the strategy rollout, we are doing this by increasing our focus to future-facing commodities. But that is not all. We are confirming our place in the green hydrogen economy through our partnership with Origin Energy at Kooragang Island site to finalize the feasibility study into the commercial production of green hydrogen and ammonia, which I will talk about shortly. Our second pillar of accelerating decarbonization focuses on the investments we are making towards meeting our public targets and ambitions to reduce emissions by at least 40% by 2030 and to be net zero by 2050. In this respect, we are reducing our direct emissions from the manufacturing of our core product portfolio. We have already installed tertiary abatement at Carseland and will commence installation at Kooragang Island toward the latter part of this calendar year. The embedment of climate actions into our strategic decision-making will ensure we are successful. This means relentlessly integrating our climate risks and opportunities into our analysis, governance, planning, capital allocation and strategy development and execution. Finally, our actions must align with the commitments of the broader supply chain and communities. The emerging interest of our major customers in our emission reduction initiatives is particularly exciting and is featuring more and more in our commercial discussions and tendering processes. If we look at Slide 88, it shows our journey towards our net zero ambition. As an organization of engineers, setting our 2030 target and 2050 net zero ambition was not an easy one. We did not want it to just be a statement left to the next generation of leaders to address. In this respect, we analyzed and outlined the credible evidence-based pathway to achieve these targets, which was signed off by both the Executive Committee and the Board so as to provide confidence to our investors, partners and staff that we will successfully transition the business to meet the demands of a growing decarbonized global economy. As is evidenced on the slide, our focus over the remaining years of the current decade will be on reducing direct emissions from our nitric acid plants, securing renewable power agreements to our major manufacturing sites, driving production efficiencies and with partners such as Origin scaling up the volume of greener feedstock for our ammonia plant. Over the longer term, achieving net zero will see Orica purchasing from lower carbon suppliers. In this respect, I'm pleased to report that our inventory analysis of our Scope 3 emissions shows that our material ammonia and ammonium nitrate suppliers are already covered by similar emission reduction commitments. And then finally, we will purchase a small volume of credible residual offsets. So what exactly are we doing today? If we turn to Slide 89, I'll provide a little more detail on a couple of tangible examples of how we are following on our commitments with action and investment. Orica's global portfolio of nitric acid plants emit nitrous oxides, a particularly concentrated greenhouse gas as a chemical byproduct of converting ammonia into ammonium nitrate. By putting in place, what is referred to as tertiary abatement on these plants, which achieves in excess of 90% emissions reduction, we can reduce our total Scope 1 and 2 emissions by approximately 30%. This technology is proven, but it is capital intensive. Under normal investment disciplines, the business case for deploying the technology would be challenged. However, we are pleased that we've been able to collaboratively partner with the provincial government in Alberta, Canada and the New South Wales government at Kooragang Island to progress with these important installations through co-funding and the generation of carbon credits. The net result is that the Carseland plant now has the tertiary abatements in place and is fully operational and performing above expectations. And the equipment for Kooragang Island is already in transit and scheduled for deployment later this calendar year. Similar investments at our Yarwun facility are now under final consideration. Once the decision is made, it is planned that these will be installed during the scheduled 2024 turnaround. And emission reduction technology that is in its infancy is carbon capture in use. And many of you would be aware of our long-term investments in Mineral Carbonation International. MCR's research into the manufacturing of building products from direct CO2 capture was highlighted at the 2021 United Nations Climate Change Conference in Glasgow. We are delighted that our Kooragang Island facility has been chosen for its first demonstration site. This has been made possible again by government co-funding and support of regulation. The MCR plants will start taking CO2 directly from the Kooragang Island ammonia plant in 2023. We are confident the results from the demonstration plant will provide a strong taste to the government and investors to upscale the technology and build a larger scale plant. Importantly, these 2 examples are indicative of our investment commitments in reducing emissions. They are indicative of our proactive and swift actions that we have taken to meet these commitments. And alongside our feasibility study into green hydrogen at Kooragang Island demonstrate our support for emerging transformational technologies. Beyond our site boundaries, it is also fair to say that Orica can act as a catalyst for change within the regional business communities within which we operate, and this is reflected on Slide 90. At Gladstone, we have 2 important collaborations, namely with Alpha HPA as an excellent example of how commercial partners can develop circular economies. In this example, Alpha HPA will take ammonia and nitric acid from Orica's Yarwun plant to produce battery materials for the electric vehicle sector and then return ammonium nitrate back to the Yarwun site, which is a byproduct of the manufacturing process. And then secondly, with H2, backed by Mitsubishi Heavy Industries, to look into the development of a large vertically integrated green hydrogen and ammonia export hub. At Kooragang Island, we are working with a growing number of academic, government and commercial partners on a future hydrogen hub, including Origin, the University of Newcastle and the New South Wales government. Both the Gladstone and Hunter Valley locations are strategically located and have been formally identified as future hubs for green hydrogen by both the federal and state governments and the broader investment sector. The potential role for Orica and green hydrogen is exciting and has the potential to secure jobs and industry for these important regional communities. That said, we are at the early stages of transitioning these precincts. We will continue to face many challenges, including scaling up the technology to commercial levels, reducing the capital costs of electrolyzers and the price of renewables, securing adequate government support and developing demand and margins in traditional and new markets. We will continue to rigorously assess the commercial case before we commit to next steps and will maintain optionality around what role we can play in the green hydrogen supply chain. Whilst there are many challenges, we also see opportunities. And through collaborative partnership, we believe it will provide Orica with a number of strategic options in our journey toward net zero. To end off the sustainability section, I'd like to draw your attention to Slide 91, where we focus on working with our traditional mining customer base. Alongside our best-in-class safety proposition, we believe Orica is well placed to differentiate our products with the mine site efficiency gains from our unmatched range of enhanced blasting and monitoring technology solutions and with a subsequent reduction in environmental and carbon footprints. Over the coming years, product innovation focused on safety, efficiency and reduced emissions will continue, and this will ensure Orica retains its leadership in the sector. This, we believe, will future-proof in -- shareholders' interest at a time of heightened disruption and change as the world and industry decarbonizes. Thank you. The one thing I think you'll be pleased to know is that as we go into the finance priorities section, we're not going to be playing a video because I can only imagine how dry that would be. Turning now to the exciting subject of finance priorities and more specifically, our approach to capital management and cash. Two critical components that will enable us to realize not only the growth opportunities that each of the regional Presidents have spoken about today, but also allow us to continue to invest in the technology capabilities that Angus has spoken about, which will drive value for both Orica and our customers. As is shown on Slide 94, we remain guided by our capital management framework, which governs our actions towards the maintenance of a healthy balance sheet. This framework is predicated upon 3 key principles, namely maintaining an investment-grade credit rating; preserving the flexibility for future investment alternatives and to respond to changes in the external operating environment. and maximizing our returns to shareholders. This approach has been in place since 2016 when we made several material changes affecting our financial profile, including, we transitioned from a progressive dividend policy to a dividend payout ratio policy of 40% to 70% of underlying earnings. Something we have successfully maintained throughout the COVID-19 pandemic at a time, other companies suspended dividends. We have also embedded an approach toward capital investment, which drives a disciplined assessment of all capital approvals, taking into account affordability and the delivery of a targeted improvement in return on net assets. Finally, we operate within a targeted gearing range of 30% to 40% to better align with key credit metrics that underpin our credit rating. If we turn to Slide 95, entitled capital expenditure. As I've already mentioned, we have embedded a disciplined approach toward the assessment of capital expenditure. All capital expenditure related to safety, environment or regulatory requirements is prioritized, whilst other capital expenditure is subject to financial hurdles and ranked according to a rigorous prioritization process. This capital allocation process ensures sustenance capital is available to support and maintain the asset base. It results in the best growth opportunities being favored over lesser-returning alternatives. It drives a focus and culture towards the delivery of increased return on net assets, whilst at the same time, delivering sustainable shareholder value and return on investments. It is our belief that this focused approach toward capital investment has driven an improved focused and sustainable capital expenditure profile that balances the enthusiasm of the business with the need to maintain a healthy balance sheet. Importantly, following the completion of the Burrup commissioning in late 2020, we do not see a requirement for further material investments in additional ammonium nitrate capacity in our major markets. We are comfortable that we can meet demand as we move forward without significant capital spend by leveraging both our existing manufacturing capacities and third-party supplied ammonium nitrate. With the completion of the SAP project in 2020 and subsequent stabilization efforts in 2021 and 2022. Additional capital has been freed up and has been applied towards an increase in sustenance capital toward a further improvement in plant reliability, as Leah has already mentioned. Further incremental investments in growth projects and technology investments. And importantly, increased investments that will ensure Orica meets its commitments to decarbonization and sustainability. Furthermore, we will continue to evaluate our asset portfolio to liquidate noncore land holdings as we have successfully done in the past. These will be monetized for cash, which can be deployed towards investments or the acquisition of higher-performing assets. Turning to cash conversion on Slide 96. We operate within a targeted gearing range of 30% to 40%, which aligns towards other key credit metrics underpinning our BBB credit rating. As I've previously mentioned in the half year results, 2022 will experience an increase in trade working capital that is expected to continue in the near term. As you are aware, ammonia is the primary raw material in the production of ammonium nitrate and is a significant cost driver, which impacts inventory valuation when prices increase. In the first half of 2022, key ammonia indices, namely the Far East CFR and Tampa CFR indices have increased 67% and 144%, respectively, as shown in the charts on the left. The increase in inventories is not altogether unexpected given the significant increase in raw material input costs as well as the need to secure additional and alternative sources of ammonium nitrate following the cessation of third-party ammonium nitrate purchases from Russia, which has historically accounted for a significant portion of Orica's ammonium nitrate needs. This, alongside the impact of significant increasing inflationary pressures across other key raw materials, impacts not only inventory valuation but also trade receivables values, which will impact trade working capital and cash conversion in the 2022 financial year. Importantly, our focus remains on trade working capital days, which is expected to increase as a result of increased inventory holdings to counter supply chain dislocations, including freight. This is something we are monitoring closely to ensure levels remain appropriate. Turning to Slide 97, entitled debt management. As previously mentioned, Orica maintains a conservative and balanced approach toward debt management. We value our investment-grade credit rating, which is currently positioned by Standard & Poor's at BBB, negative outlook. Our credit rating secures us access to the committed debt facilities we require and allows us the ability to do so on desired terms in exchange for appropriate pricing. As a result, we maintain strong and mutually beneficial relationships with several international and domestic banks as well as U.S. bondholders with whom we maintain an active relationship and dialogue. We have an appropriate distribution of debt maturities, which is further complemented by our actions to proactively refinance maturities in advance of our requirements. In this respect, during the second half of this year, we renegotiated and extended $299 million of committed debt facilities with existing group relationship banks. This involved approximately 22% of our total committed bank facilities, including a refinancing of $249 million of 2022 maturities and a prefinancing of a further $50 million of 2023 maturities. This refinancing has resulted in an extension of our average committed debt facility maturities from 3.8 to 4.2 years. We have a USD 80 million bond maturity in October this year that we will refinance with existing cash and undrawn bank facilities and a larger USD 350 million maturity in September 2023 that we will refinance next year. Our current cost of funds is approximately 3.8%. Approximately 60% of our drawn debt is fixed. To wrap up, one of my key priorities in the role is to continue our disciplined approach to capital management and cash. As a company, we remain focused on ensuring that allocated capital delivers at or above the respective hurdle rates, cash generation remains strong and that our overall capital management program delivers attractive returns to our shareholders over time. With that, I'll now open up to the audience for questions to either Leah or myself. Thank you.

Thanks, Chris. What I'm going to do is I'm just going to extend the next question time to a little bit more. Instead of closing at 1, I think we'll close at 1:15, if that's okay. There's a lot of good questions coming through the line, and I'm sure there'll be some questions from the room too. Let's start with John. John was putting his hand up a little while. John, over to you.

John Purtell from Macquarie. Look, thanks for the presentation today. I just had a couple of questions, sort of more broadly. Just in terms of a likely global growth slowdown that we're seeing, which end markets or regions do you think Orica's going to be most resilient in? And which do you think there's more sensitivity or more exposure?

John, it's difficult to predict given the volatility that we are seeing there, interest rate hikes coming through, inflationary pressures across global economies. A lot of these economies are pretty resilient. And the macros that we look at tells us that demand for hard commodities are going to remain strong, given that there's significant supply constraints because there's a lot of capacity that's not in the market. There will be a correction. We have seen some commodity prices coming off towards very record highs, if you look at gold or copper or iron ore. But they're still at a very, very healthy level, and we still see very strong demand across the board. I think the bigger constraint is supply. And this is twofold. One is the limited capacity that our customers have in terms of ramping up production to fill big holes like Russia or China. The second major issue is the uncertainty coming out of the ag space. So obviously, the resource industry competes with itself in terms of hard commodities versus soft commodities. And there are other different priorities at play here. How will that play out? That will have a significant impact overall on supply and demand as a macro. So that's something that we're watching very carefully. Energy inflation is here to stay. I think at the last results, I made a statement, I'm not so much worried about energy pricing or electricity pricing, I'm more worried about availability. And unfortunately, at least in our country, but in many other economies that statement came true. So I should basically shut up because today, the challenges that are -- some of our suppliers who we depend on, Tier 2, Tier 3 suppliers who do a lot of work for us and who are not contracted on power or gas, they are really suffering. And that's not just an Australia story. It's a global challenge. So all of that just challenges the entire global supply chain, and it creates short-term disruptions and it causes volatilities. And then the big question is, will there be a demand destruction coming out of inflation? It's very difficult to say. Everybody has their own opinion here. But a combination of demand destruction and oversupply would be a problem. I'm not concerned about oversupply, I'm concerned about undersupply. So if demand destruction comes and stays for a period of time, that is something that our industry will weather, and we'll come out better on the other side. So we are creating at least within Orica that resilience and robustness in terms of flexibility in our supply chains in terms of ability to breathe using our partners and our own networks and all of that, and we are relatively well prepared for this. I have a bigger concern and that is suppliability across the industries for everything, products and services. And this is going to be a challenge that all of us will have to will have to tackle. So I know it's not the answer you're looking for. It's very difficult. There's so many moving parts here. But one thing is sure, there will be volatility. There will be external factors that will be coming which we cannot control, and that's why it's very important that Orica focus is on the execution of the strategy and don't get distracted. Focus on what you control, focus on what you influence and try to come out better at the end of this amazing cycle that we are going through currently.

And just a second question. You've mentioned that your plants are fully sold. So the broader question is how do you meet stronger demand in that context? I know, Chris, you just touched on some aspects of that. But does that imply that the incremental tonnes to meet that demand will generate more traded margin than a manufacturing margin?

It will be a bit of both because we have room to play because all of plants always have latent capacity. So I don't see here a need, and I think Chris Davis mentioned this that to build a new ammonium nitrate plant somewhere in the world. Each of our factories, both continuous and discrete have enough latent capacity. It's all about smart, low capital debottlenecks to address supply chain issues. I mean, Leah talked about a few, Germán mentioned a few, right? You build a tank here, you build a pipe there, you add a warehouse, you add bagging capacity. You change the nature of the product, so it's easy to ship. And all of this does not need a lot of capital. It frees up immediately in a very short period of time, capacity within the network. So that always gives us the opportunity to manage demand surges. So if customers would come and ask us for millions of tonnes, we would obviously politely decline. But if there are growth customers willing to pay us the right value for our products and services, we are more than happy to cater to that need with those small measures, which are already in place. So flexibility and resilience of our manufacturing and supply network is absolutely key to do that. And then obviously, our partnering strategy where we make as well as buy helps us to breathe and manage with those spikes in demand. The other way around, if demand would slacken, we have all of these moves in place, which are no regret moves. And right, we would still have that flexibility in play to play both an upstream in markets. But also if there's a potential downstream sometime in the future, we would be in a much better position to negotiate them. As one example, when we buy gas or ammonia across the globe we are locked up in take-or-pay contracts, which means that even if there's no demand for our products, we still have to consume that raw material or pay penalties. And we have started flexibilizing those contracts so that we are able to breathe here. And we don't have this big pressure. Going back to your question, why do we keep pushing volumes into the market, the market doesn't need? That was another factor to it because we were forced to do that because we were tied up in these kind of supply contracts and either you pay a penalty to your raw material supplier or you dump the product in the market. We don't have to do that anymore. So we brought that flexibility and resilience into the procurement strategy that Leah and the team -- global team have been driving, and that also gives us more flexibility to play around that capacity spikes as well as dips. So it just keeps us in a better position than we were, say, 2, 3, 4 years back.

A question from Daniel.

Daniel Kang from CLSA. A couple of questions for Leah, please. Just on Lean, how far are we in the process or the journey of Lean? Just want to get an understanding of the potential magnitude of the benefit that's likely over the next few years? That's the first one.

No, great question. So Lean is about looking at the network and removing waste from the network. So I would say that our manufacturing sites are well developed in this area. We've been focusing on really ensuring that we're evaluating the entire workforce, driving initiatives and opportunities, removing waste, removing scrap. That is well established. Our opportunity is in the supply chain network. And really looking at our network as a whole, and we've been investing in modeling programs to look at optimizing and reducing our lead time to customers, really looking at flexible and smart distribution network and very small investments to make sure that we can improve the lead time and reduce over time our cost to serve. So I would say well established in manufacturing, big opportunities in supply chain, and that's where we're developing that.

And in terms of magnitude of cost savings?

For us, it's about more increments over time. We talked about -- there are certain things around input costs for AN that we just try to offset inflation. That is our key value there. But as far as magnitude, we'll be delivering offsetting of inflation year after year, and that's the plan we have.

And just on the optimization piece. Where are you in the process of, I guess, starting, say, debottlenecking opportunities? What's the magnitude and the cost of that opportunity?

Yes. So we've got a sign-off strategy in regards to our discrete manufacturing network, and we're pretty much completed on the first phase. We talk about growth. We are limited on growth of AN, but we actually haven't talked about the opportunity with discrete manufacturing. We're actually doubling our capacity of electronic blasting systems by 2025. And that is really low-cost investments. And that is our next phase of the strategy is to actually put low cost EBS assembly close to our customers. That's going to drive value, and it's a high-margin product and an important growth enabler. And that's part of really the leveraging strategy for Quarry & Construction vertical.

Okay. Thanks, Daniel. I might just turn to a couple of questions for you Chris, if I may. Why wouldn't second half deliver a reduction in TWC given ammonia prices have declined since the first half?

I mean I think ammonia prices have come down a bit, certainly not to the levels that they were in September last year. That said, what I had indicated at the half year is that we've done a number of prepayments to secure inventory, and that was treated as nontrade working capital. So now as that's converted, it's off to inventory, it's going to lift the value of trade working capital. We've also increased our inventory holdings to ensure security of supply for our customers as we've been taking product from these new sources of supply. And unfortunately, in some respects, those new sources of supply on either cash upfront or shorter payment terms than what we traditionally had before. Then the other thing, as many of you will know, the second half is stronger than the first half of the year. So we have increased inventory and trade receivables to deal with that.

Thanks. Chris. I'll just -- there's a quick one here. How much of the debt is on fixed versus variable?

I did actually say it during the course of my speech, about 60% of our debt is on fixed rates. And so we're average at the moment, about 3.8% on cost of funds.

And a very last one for you on RONA. Is RONA use as a metric to evaluate CapEx projects and also the entire company? Is there a target on where RONA would be over the next 3 years versus now?

Yes. So we evaluate all capital expansion as well as the business on RONA target. Now the RONA targets, we've historically said it's above 18% for individual capital projects. Now when we look at it from a group perspective, we put a target out there of 10% to 12% over the next 3 years. We still remain committed to that. And to the extent we can do better, we'll go for it, but that is our commitment now that we do not want to disappoint on.

Thanks, Chris. Any further questions from the room, Richard?

Can I just go back to JP's question on the network and the trading margin versus the manufacturing margin. I mean, at the moment, you're pushing product out or you have been out of Australia into LatAm, I think it's into Peru. I mean what options have you got to -- or let me first say, is that just margin management? Or is there some other reason for doing that? And secondly, so what options have you got to bring product back into Australia if growth in what is your highest margin market is above what do you think? And then I'm just interested to get a sense from you, given the regional structure for manufacturing, how do you manage manufacturing margin management? If you know what I mean.

Yes. So the reason we set up the supply chain to take product out of Australia was to have that supply security going knowing that Russian sourcing would not become -- would not be possible anymore. And as I mentioned earlier, we have latent capacity in all our assets everywhere in the world. So what do you do to leverage that, which means basically splitting your assets, right? But it's not easy because on one hand, you have capacity, but whether it's in the right shape and form; and secondly, whether there's a supply chain established to move it across oceans to other markets and then there's customer approvals and all of that. So that's an activity we started, and we started with the investments to upgrade the quality of the product that comes out, for example, out of Yarwun so that we were -- we had to get it export ready. We got lucky with timing because as soon as that new investment came into play, markets got tight, and there are low months and high months and especially this year because of the wet weather on the East Coast of Australia. We've had a lot of lower months here in Australia, where we were producing volumes, but customers were not able to consume them because of mine sites on the water. So we just put that into a charter vessel and shift it to where there was a need, right? So we kept the assets running at high utilization. And whenever there was space to breathe, we just put this onto a vessel and sent it elsewhere where we were buying and converted trading margin into own manufactured margin, which is always the smartest thing to do. So that flexibility is today existing now in all facilities. We could do this out of Canada, if we need to. We could do it out of Australian plants. We could do it out of Indonesia. And -- which is a fantastic luxury for us because if a domestic market had a specific issue and we were not able to fill that asset, we don't have to ramp down production. We just put it onto a vessel and take it elsewhere. So I think that's just ideal. And it just adds to the resilience of the manufacturing network and the flexibility that we needed. We've done the same with our discrete manufacturing sites where we have now products that can be switched interchanged and several products could be made out of the same lines. And we can do this very, very flexibly. So all of this is basically investment that Leah talked about into flexibilizing and strengthening our manufacturing network across the globe.

Just an easy one, hopefully, for Leah. Can you remind us what the turnaround there -- and turnaround schedule is, please?

Yes. So we've got upcoming turnaround in Carseland, which is in October. And we've also got one upcoming in Kooragang, Island for nitric acid one and the AN plant facilities there. And in 2023, we have a Bontang shutdown. And we also have a Yarwun shutdown coming up for a full site shutdown for electrical upgrade.

Thanks, Leah. I may just -- there's a question on the line for you, Angus. You mentioned geospatial ore body knowledge gap in the portfolio. How do you characterize that market gap in terms of opportunity and size of the market segment?

So first of all, I'll talk to the market. So geospatial measurements or gyroscopes or multi-shot measurements, they're not new. They've been around for a long time. Any time you take a measurement, any time you drill a hole, you need to geolocate that. So you can correlate the market with exploration drilling with [ res ] development drilling, anytime you need an expansion. And so you can benchmark that to some existing market players. In terms of the gap, if you look at Orica's ore body intelligence capability today, I talked about the what, the geomechanics and the geophysical -- the geophysical, the geochemical measurements. So we have built through our own development through acquisition, a number of measurements and sensors through the Rig and [ Hig ] acquisition through the Rhino center. These are geophysical and geochemical measurements. So we have the what in the portfolio. We don't currently have a capability in geospatial, hence, the gap. In terms of the opportunity, if you buy into the thesis of the industry needing more and better quality ore body intelligence, this is going to be a growth market. And particularly, as you see a transition of those measurements onto a wild drilling environment. So currently, they're done either while drilling or after drilled or during coring to correlate and locate some of those measurements. As you see a transition to more wild drilling measurements, and this is why we made the Rig acquisition, you'll see the need for more geospatial measurements to be run with the geochemical and geomechanical measurement. So we think there's a growth opportunity there.

Thank you, Angus. There's a question here, Dan.

Sorry, just a couple of questions for Sanjeev and Chris, actually. Sanjeev, just can you remind me about the situation on the East Coast gas contracts? How are you positioned once your fixed price contracts expire?

So we are -- our gas book is covered until '25, 2026. We've renewed contracts last year. And so our gas needs both for Kooragang Island and Yarwun are covered. And we've brought in, through these contract negotiations, more flexibility in terms of operating with our gas suppliers. And you know that we have multiple gas suppliers. So we are not dependent on any one. And given the fact that we are a major industrial consumer of gas, we are a preferred customer. It was interesting, a gas supplier once told me, I'm happy to supply a consumer who does manufacturing with gas rather than generate power out of it. So that was interesting insight from a gas company. So obviously, they do prefer to operate with us because we are more consistent. We are more reliable. We have more visibility in terms of our gas needs over the next 10 -- we could do a 20-year forecast if there was a need to do it. right? With the gas for energy, it's much more difficult given the volatility of renewable energy, solar and wind coming in into the grid. So we are a preferred consumer. And so far, the gas companies are happy to operate with us, and we are covered. We are now thinking about the next round. And we have to separate between consumption of gas as a raw material, as a feedstock, which is an important aspect for us. And we have a lot of measures in place to delink our energy needs or our power needs because we are an energy-intensive manufacturing organization. We are in the process of delinking this to gas, right? So that we have different levers to pull. And there'll be some announcements that Chris Davis will make in the near future about what we are planning to do. Once again, building resilience in manufacturing, and flexibility and making ourselves fit for the future. So there's a lot going on. And as soon as all of this becomes formal, we'll also make it more public.

Thanks, Sanjeev. And Chris, on CapEx, with most of the growth CapEx behind us now, sustainable CapEx of about $200 million. Is that where we should be forecasting CapEx to drop down to, around that $200 million?

Yes. So your sustainability capital expenditure should be about $200 million, $220 million. Growth normally sits at around about $80 million to $100 million, depending what opportunities come up in any one year. And then on top of that, we've got the sustainability expenditures. So your tertiary abatements we're putting in place in Kooragang Island. So we've maintained the position for this year. I think it's about $340 million to $360 million. I think going forward, it will probably be towards the top end of that range because next year, we have the tertiary abatement at Kooragang Island.

Well, thank you all. It's now 1:15. Let's close the Q&A session. And for those in the room, you can now have some lunch and talk to the executive team there. But before I hand it over to Sanjeev for the final close. Can I just remind those who are joining us at the Kurri trip tomorrow. You've got a very early start. We're leaving Sharp on 6:30. We're meeting at 30 Pitt Street [indiscernible] . We will provide a little breakfast for you, so that will be something for you to look forward to. But we do need to get there as soon as possible. We've got a full session planned for you. So let's make the most of our time. So we'll see you there. Please see [ Joeline ], we need to get to rapid antigen tested before you go. So that's one of the requirements of going into the plant. We've got tests there. You can take it home and do it and then when you get on just to clear that you are negative. If you're positive, please stay at home. But with that, Sanjeev, I'll hand over to you.

Thanks Delphine. So let me start by thanking all of you, also the people who joined us virtually. I hope that we fulfilled our -- or your expectations of giving you a bit more insight into what this management team does, what do we think every day, what went into creating that strategy and what are we doing in terms of very consequential execution of the strategy despite all the challenges that the world throws at Orica, but everybody else out there in the market. So just quickly running through 2 slides, we do and we will continue to do a half yearly update of where we are in terms of strategy updation. That's our scorecard for our investors. And every 6 months, we'll come up with these key parameters that we monitor very, very closely, and we'll update you on details in terms of execution. And this is something that drives us every day because I've seen in my life, in my career, wonderful strategies being written and then we fail to execute. So the focus is now fully on execution. Whatever we do is within the parameters of that strategy, within the guardrails of that strategy, and we'll continue to focus very, very strongly on this. And I think it just -- we get lucky with timing and coincidence because all those macros that we assumed when we went ahead and wrote that strategy, they seem to come true. And we see some positive tailwind at the moment to our business. And all of that will just motivate the 13,000-plus team members of Orica to even more strongly focus on this and continue to deliver. And then finally, I'll leave you with the last slide again. Our focus is clear. We've talked about all of those issues. A deep dive into technology, a lot more into digital and the other technologies tomorrow at the Kurri site, which should be very exciting. And then all these beautiful solutions and wonderful investments we've made in innovation that we're now bringing to our customers, we start to see the scale coming in, and this will translate into better earnings profile. And in the end, we would like to maximize shareholder returns. That's a clear focus of this management team. And you've seen and heard all of us in action. And I'm hoping that in future, we'll get them all into a room so that you also can physically meet and interact with them because these are the folks who do the real work, Delphine, Chris and I, we are more postmen. We just deliver -- or post people. We just deliver the message. They are the ones who execute. So thank you for that. And before we close Delphine's team, [ Joeline ], [ Rene ], Andrew. Andrew is at Kurri Kurri today preparing for -- to receive all of you tomorrow. And Camille and [ Claudia ], thank you very much for organizing this technology work. Everything went through without a hitch. We nail the timing. And I hope that all of you will join us now for a lunch, at least the people here in the room. Thank you all, and all the best for tomorrow's visit.