The Weir Group PLC (WEIR) Earnings Call Transcript & Summary

Welcome, everyone, and thank you for joining us at the second of our 2 capital markets spotlight events in 2022. Our virtual webinar today is focusing on sustainability and technology. And this follows on from our event in September on growth and our Performance Excellence transformation program. Before we turn to today's agenda, I want to outline the overall positioning of Weir as a focused mining technology leader. Our recently completed portfolio transformation means we're focused on mining and able to prioritize our resources on pursuing the long-term sustainable growth opportunity this presents. I believe this is compelling because, first, mining has a critical role in decarbonization with the world needing significantly more metals, such as copper, nickel and lithium to deliver the transition to net zero. Second, 75% of our revenues come from aftermarket driven by all production trends and which is inelastic to mining CapEx and commodity price fluctuations, meaning we are highly resilient. And third, by focusing our resources and thought leadership, we're expanding our addressable markets through organic growth initiatives and will play a leading role in mining's technology transition. We will pursue this growth opportunity by continuing to invest in our unique capabilities and by maintaining them. We will pursue this growth opportunity by continuing to invest in our unique capabilities and by maintaining high barriers to entry. We solve our customers' biggest challenges through our world-class engineering expertise, increasingly complemented by data and artificial intelligence. Across the globe, we are embedded in our customers' operations and supply chains with strong local relationships and strategic corporate partnerships. And we have a large captive installed base of trusted mission-critical equipment, a key driver of future aftermarket revenues. With a focused world-class business and clear growth opportunities, we are well placed to deliver. And our commitments to our stakeholders are simple and clear. We will grow faster than our markets, delivering compounding growth in mid- to high single digits through the cycle. We will deliver operating margin expansion through operational leverage and our new Performance Excellence program, which in time, will take us beyond our 2023 target of 17%. We will cleanly convert our earnings growth into cash and returns and deploy it in line with our capital allocation policy. We will remain highly resilient as demonstrated by the 7% CAGR in our minerals aftermarket since 2011. And we will deliver all of the above in the right way, eliminating harm in our operations and communities and with clear commitments to emission reductions in our end-to-end value chain. These commitments will be delivered through our We Are Weir strategic framework, focusing on people, customers, technology and performance. Our framework delivers several strategic levers to enable growth ahead of our market. These include our growth and performance excellence initiatives, which we outlined in September. And then we have our sustainability and technology road maps, which further underpin our growth ambitions, which is what we're focusing on today. So now on to the agenda. First, I'm going to talk you through Weir's overarching sustainability strategy. Paula Cousins, our Chief Strategy and Sustainability Officer, will then explain how our technology strategy is addressing increasing customer demand for more sustainable solutions. And our divisional Vice President of Technology, Chris Carpenter and John McNulty will spotlight specific technology examples. It will then be back to me for some closing remarks before we open the floor for Q&A. Sustainability is core to Weir. It is central to our purpose and strategy, driving the growth plans in our business, dictating how we operate and providing the framework for everything we do. The world needs metals. They are essential to everyday life and demand is set to increase as the world strives for net zero, and while recycling will play a role, meeting this demand will require more metals to be extracted from the earth. However, to enable this and for the mining industry to have the environmental and social license to operate, it needs to become smart, efficient and sustainable. So our purpose as a business is clear. We will be a leader in enabling this journey for our customers and our world, which will drive great outcomes for all our stakeholders. Electric vehicles need 4x as much copper as traditional petrol cars, while solar and wind generator power needs more than double the amount of copper versus conventional sources. So the requirement for more metals is not in question. But with planned copper production insufficient to meet demand, miners are pursuing growth, accelerating production from existing assets and pursuing new expansion projects, both of which represent attractive opportunities for Weir. Indeed, if the world is to achieve the outcomes of the 2015 Paris agreement, it's estimated that almost 10 million tonnes of new copper supply will be needed over the next decade from projects that are yet to be sanctioned, and that's equivalent to around 1/3 of current consumption. To achieve this, the industry needs to deliver new projects as a frequency never previously accomplished and spend $23 billion every single year. To achieve this, the industry needs to deliver new projects as a frequency never previously accomplished and spend $23 billion every single year, which is 64% higher than the average annual spend over the last 30 years. However, while demand drivers are clear and the miners have intent concerns around the social and environmental impact of mining together with local political and fiscal tensions are creating complexities in permitting and making new projects slow to convert. So to unlock the supply needed to achieve Net Zero, the mining industry must adopt more sustainable operations and engage its stakeholders in this shift. Mining has a broad and diverse group of stakeholders, including customers, employees, communities and the governments of the regions in which it operates. And in pursuit of sustainability, it is recognizing the need to focus on the environmental and social impact on these stakeholders. This is evidenced in a recent KPMG survey of mining executives where environmental impact is now recognized as the #1 risk facing the industry, closely followed by the need for improved community engagement and relations, reduced energy consumption, use of renewable power sources, efficient use of water and less waste are prerequisites. And to be sustainable, mining needs to reposition itself to attract new talent and overcome skepticism regarding its role in delivering Net Zero. So while the industry's price is significant, lots need to change for it to maintain the social and environmental license to operate. And this is where suppliers like Weir, have a key role to play, providing the technology and expertise needed to reduce the industry's footprint and helping to improve its reputation. Alongside helping our customers, we're also playing our part, and I'll now outline how we're making Weir more sustainable. To drive growth and value from sustainability, we launched our sustainability road map in late 2019. It's a framework that's linked to our purpose and provides a focus and common language for the organization, underpinned by strong governance and an aligned reward framework. It was created with input from key stakeholders, including our customers, suppliers and employees. And it focuses on the 4 key areas where we can have the most material impact covering people and the environment. And that starts with our own organization. We want to be a zero harm business with a highly engaged workforce. Our operations must be sustainable, and we have set ourselves ambitious emissions reduction targets, which are currently being validated by SBTi. However, the biggest impact we can make comes from creating sustainable solutions to reduce the environmental impact of our customers' operations. I'll now talk you through each of the elements of the road map in more detail. The safety of our 11,000 employees is the #1 priority for me and for the whole group. I want Weir to be a zero harm organization where everyone goes home safely to their families every day. We're making great progress with Minerals having one of the best safety records in our industry and ESCO having made significant improvements since acquisition. However, there's still more to do, so we're complementing our existing management systems, training and governance with a new Zero Harm behaviors program. This focuses on how we behave when we deliver safe outcomes and what happens when accidents happen, with the aim that if every colleague has a deep loyalty represented and over 40% are female, and we're working hard to replicate this at other levels. It all translates into a compelling value proposition to attract the best talent to come and work for us and stay long term because they love what they're doing and the people they work with. And this all contributes to our sustainability as an organization. And while we have more work to do to meet our ambitions, we're making really positive progress, and that's clearly demonstrated through our regular all-employee survey where we get 90% participation and which put our employee Net Promoter Score, a measure of employee engagement in the top 10% of companies in our industry. Our culture is very special and is a huge asset to Weir. It's hard to capture on slides. So here's a short video in which our Chief People Officer, Rosemary McGinness, brings this to life.

Thank you, and hi, everyone. I'm delighted to be joining you to talk more about safety and culture. As you've heard from Jon, we are making great progress on our journey towards zero harm, and our employee engagement is among the best in the industry. I'd like to share a little more on how we're achieving this. Thinking safety first is a core value for us. We put a great deal of emphasis on embedding a zero-harm culture, where people can talk openly about safety concerns and are empowered to make improvements. And there's great examples of this in action at our manufacturing site at [indiscernible] in the U.K. The site already had a good system of regular safety tops in training, but wanted to add an easy-to-use system to drive further improvements right where they are needed. They introduced a digital system so anyone on site, including visitors could submit improvement opportunities or call out hazards in real time. And as a result, almost 2,000 safety conversations have been recorded this year. The products we make on site are heavy, and so lifting and handling them is a risk. We are trialing new lifting tools in the machine shop and have introduced special exoskeleton suits and gloves that provide physical support to reduce the risk of strain or injury as well as being a safe place to work. We want Weir to be the place where people can do the best work of their lives, achieving personally and for the company. That means providing opportunities for them to develop their skills in career. Digital skills are a particular focus for us, especially for our employees who don't access computers as part of their work. Here, we created a brilliant program called Weir Connect. This means our 230 production staff at [indiscernible] Margin can now access our online HR system for information and learning, and we've also been able to introduce digital scorecards and manufacturing systems throughout our operations. We're now extending. We are connected to other parts of the world. For people to do the best work of their lives at Weir, they must feel that they compete themselves and feel like they belong. Our inclusion, diversity and equity strategy is helping us address that. Our employee-led affinity groups for women and our LGBTQ+ community and their allies are doing an amazing job driving change. We run apprenticeship programs that are bringing in the next generation of diverse talent, and we support a number of flagship programs for female engineers. Shifting our gender balance is not proving easy, but we are determined to overcome the challenge. I describe the culture that we as a big global family, and that includes our communities as well. Community involvement happens locally. [indiscernible] we boarded the beautiful Rochdale Canal. Our staff gives their time so that the area is well kept and save for the community to use. And right across Weir that are truly inspiring examples of community programs and individual volunteering. I'm really proud of what our people have achieved on safety and culture since the launch of our sustainability road map, and I'm excited by what's still to come. People are what made Weir special, and it's through them that we'll deliver on our purpose and our strategic ambitions. Thank you.

Now turning to our environmental footprint. While small overall, the most energy we use is in our manufacturing operations and in particular, our 11 foundries where we use electricity to melt metal as part of the casting process. For overall, the most energy we use is in our manufacturing operations and in particular, our 11 foundries where we use electricity to melt metal as part of the casting process. To address our footprint, we've set ambitious targets currently being validated by SBTi to deliver a 30% absolute reduction in our Scope 1 and 2 emissions by 2030. And by updating our target earlier this year to an absolute reduction target rather than a target relative to sales, we have committed to achieving this while also delivering our growth ambitions. With a 15% absolute reduction over the last 2 years, we are making good progress, driven by hundreds of projects across the group, such as switching to renewable energy supply from local grids, smart metering to drive more efficient consumption, building solar generation capability across appropriate facilities and just a huge general awareness about switching things off when they're not in use. Beyond CO2 emissions, we're also trialing a number of initiatives across the group to reduce water consumption and waste. I've mentioned already our people and culture, but I also want to emphasize how important both are in driving sustainability. By way of example, let me introduce my colleague in Santiago, who will share with you how the Chile team are contributing to our goals.

Hello, everyone. It is my pleasure to join you today to tell you how we are making our facilities here in Santiago more sustainable. We are located in the community of San Bernardo in the south of Santiago in Chile, and we are a team of 1,250 employees. We have a foundry, machining operations, rubber processing and offices, and we manufacture a wide range of solutions. We have always worked with concern for safety, the environment and our community. And since the launch of the sustainability rodent in 2019, we have boost our efforts and commitments. But in 2020, over 50% of our Q2 emissions across the site came from electricity. So we knew that focusing on that will have the biggest impact on reducing our footprint. The most our 100 parts of the sites are our manufacturing operations and where we made our first suite to certify green electricity in January 2021. The impact on our carbon footprint is fantastic. We are reducing it by almost 50%, eliminating over 7,500 tons of CO2 equivalents per year. It is the same as taking over 1,600 cars of the road. We did not stop there. And we have recently installed an ari of 140 solar panels on the roof of our facilities, which will reduce our overall footprint even further. We are continuously improving our energy use. And in April 2022, we received our ISO 15001 energy management certification to help write that. We are the first, we are side to achieve this international certification. Sustainability is embedded in our culture. Through our weight segregation projects, we are now recycling over 50% of our waste on site. And we have circular economy initiative with our customers too. For example, we melt and reuse the [indiscernible] from their equipment in our foundry and the waste sand from our casting process is used to fabricate tiles. We are very proud and motivated of our achievements. Our contribution helps to us and our customers to have a more sustainable operation. Thank you very much. Let's continue making Weir a more sustainable company.

I'll shortly pass you over to Paula to introduce the creating sustainable solutions part of the road map, which switches the focus to our customers and our technology strategy. However, before I do, I wanted to summarize the key messages from this part of the presentation. Firstly, sustainability is core to our purpose. It's a growth driver for our business, influences how we operate and underpins everything we do. Secondly, sustainability is a critical issue for mining. The metals and extracts are essential for the transition to net zero. However, to have the environmental and social license to operate, mining needs to reduce its footprint. Technology from suppliers like Weir is critical to achieving this ambition. And our sustainability road map creates value for all our stakeholders. We'll deliver this value by continuing to prioritize the safety and well-being of our employees, investing in a culture for success and delivering significant reductions in our own footprint. While our sustainable solutions, which Paula is about to talk you through, deliver for our customers and the planet. Thank you. And now over to Paula.

Thanks, Jon, and hello, everybody. Today, I'm going to talk to you about the fourth element of our sustainability road map, creating sustainable solutions and how it's underpinned by our technology strategy. This part of the sustainability road map is of particular strategic importance to Weir because 97% of our total emission footprint comes from our products in use. These are our Scope 3 CO2 emissions and are also our customers, Scope 1 and 2 emissions. So we have a compelling shared goal to reduce that footprint. Unlike consumer goods companies whose Scope 3 footprint tends to be weighted towards our upstream purchased goods and services, ours is heavily weighted downstream in our customer sites. That's because our products are used in the most energy-intensive parts of the mine, the load haul cycle and in combination. And when we sell a piece of equipment, we must account at the point in which we sell it for all of the missions that will generate through its entire lifetime in use. So as we grow and we sell more products into our growing markets, unmitigated the result would be additional Scope 3 emissions. But this is where the compelling shared goal with our customer comes in, driving down our shared footprint requires our customers to move to low carbon energy supplies and for us to provide them with new and improved sustainable technologies, a win-win partnership. The miners are making material commitments to reduce their footprint. Our top 10 customers are targeting between 30% and 50% Scope 1 and 2 reductions by 2030. Such as our belief in the shared goal and the impact our new technologies can have that we too have made a significant commitment. That's to deliver 15% absolute reduction in our Scope 3 emissions by 2030, alongside delivering our strong growth ambitions. That's an SBTi line target, which we've submitted for validation. We're setting out to achieve this target from a position of strength. Our core value proposition is to our customers is lowest total cost of ownership or TCO. This is underpinned by our products operating more efficiently. So using less energy, less water and lasting longer than alternative solutions with spare parts needing replaced less frequently. These characteristics come from our core expertise in metallurgy, manufacturing processes and mechanical engineering. We have some of the world's leading metallurgists and foundry experts in our teams and our exhaust alloys and specific foundry processes are what gives our products that expanded Weir life. However, this isn't the only benefit. When products are replaced less frequently, embodied carbon emissions are also lower, less metal being poured, less waste been cases and less carbon is expanded in supply chains. So sustainability benefits are already part of our proposition. However, given the scale and pace of challenges the mining sector faces, there is much more we can do to provide transformational technology solutions. This is a driving factor of our technology strategy and at the very core of our purpose that we are. Fundamentally, miners want to get more from less. And by working closely with our customers and listening to them, we understand their biggest priorities, which can be summarized into 5 simple themes: move less rock; use less energy; use water wisely; create less waste; and boost with digital. Specifically, miners want to reduce energy and effort, expanded in processing 0 and low grade ore. They want to move less rock by moving only the highest grade material. They want to use less energy per tonne of mineral produced as that means lower emissions, and while water remains fundamental to how minerals are processed in some parts of the world, there's not enough and in some parts, there's too much. So they want to use water wisely and increased water recovery and recycling rates. Combined, these factors will create less waste and our customers also want to achieve these goals [indiscernible] to drive optimization in their operations. So as we move forward, [indiscernible] to achieve these goals are highest engaged insights to strive optimization and their operations. So as we move forward, we are using these 5 themes as a framework for our technology strategy and to prioritize and allocate our engineering and R&D resources. And as our journey as a mining technology company continues our expanding technology suite and ability to package solutions where we now are better equipped than ever to address these customer priorities. Technology underpins our growth ambition. Many of our current growth initiatives are supported by new innovations, which already aligned to one or several of the key customer themes. This includes Minerals HPGR and redefined mill circuit technology and also ESCO's transition from products to production partner, both of which we took as with the Capital Markets event in September. Our range of more nascent technologies has the potential to deliver an even further growth and is similarly aligned. This includes our innovative hydro hosting solution with significant energy savings are achieved by pumping rocks from underground rather than transporting them via trucks. Today, we're going to spotlight how we're expanding the use of motion metrics, artificial intelligence to drive optimization across the full mining value chain and also our tariff flowing technology, which is making tailings more sustainable, more on these both shortly. With clear customer priorities and a compelling price for making mining more sustainable, we are increasing our investment in R&D and rebalancing how this is spent. Historically, much of our investment has been on Horizon 1 programs focused on maintaining our core competitiveness. This includes investment in metallurgy and next-generation improvements of existing product ranges. Of course, given this underpins our total cost of ownership proposition, this remains utterly critical to our market-leading position. However, as we grow our R&D investments towards 2% of sales and expand our technology capabilities to include more digital expertise, we're increasingly allocating resources towards what we call Horizon 2 and 3 opportunities. These being mid- and long-term opportunities, which are potentially disruptive and if they come to fruition, have the potential to further transform the mining process. So our R&D strategy is therefore very clear. We will continue to invest to protect our core value proposition, while increasing spend to address our customers' biggest challenges and drive our future growth. The last thing I'd like to talk to you about today is Scope 4. As I mentioned a moment ago, as the mining sector grows, if unmitigated, the result would be additional Scope 1 and 2 emissions for our mining customers, and additional Scope 3 emissions for Weir. So we have a compelling shared goal, miners need to scale up and clean up at the same time. Countries will clean up their grids, and miners will electrify their operations and switch to low-carbon energy supplies. But the third critical enabler of Net Zero mining operations is new or improved technology that materially drives down energy consumption in the mining process. The comparative measure between the emissions of one technology versus another has the term Scope 4 avoided emissions. It's an emerging term that's not currently covered in the greenhouse gas reporting protocol. However, it has the potential to quantify the sustainability benefits of our products and solutions and therefore, support our customers in delivering their Net Zero targets. Because it's a competitive rather than an absolute measure, quantifying scope for benefit is complex. So we're using a data-driven approach devised by both internal and external subject matter experts, and which we intend to have validated by a third party. This will underpin 2 value drivers for Weir. Firstly, our Scope 4 emissions data will become part of an enhanced and compelling customer value proposition, additive to total cost of ownership. For customers, we are turning total cost of ownership or TCO into TCO squared. Secondly, while the U.K. taxonomy has yet to be established, our robust approach creates potential for a larger proportion of our sales to be classified as green revenues as we quantify the substantive CO2 savings of our products in use at customer sites versus alternative technologies. Let me now bring this to life with an example. Our high-pressure grinding rules or HPGR is the first technology in our portfolio where we've quantified these avoided emissions benefit versus alternative technology. As a reminder, HPGRs operate in combination, one of emissions benefit versus alternative technology. As a reminder, HPGRs operate in combination, one of the most energy-intensive parts of the mine, and they provide fundamental process benefit over traditional tumbling mills. Meaning to use significantly less energy to deliver the same output. In an HPGR, rocks are fed between 2 rollers, which is pressure to crush them, whereas in a tunneling mill, energy is expanding lifting and rotating rocks in grinding remedial. This is an anticipation that when they fall, the grinding remedial will strike a rock and crush it. This process is inherently inefficient. As we spoke about in our September Capital Markets event, we've quantified the energy savings of HPGR is up to 40% relative to the tumbling mill and avoided emissions benefit. However, this is only part of the scope for benefit for HPGR. The grinding media used in tumbling mills is a consumable and comprises large balls and roads Fortune steel bars. These are heavy and energy-intensive to produce and, therefore, also have a significant embodied carbon footprint. HPGR doesn't use grinding media, so also avoids these embodied emissions which are 3 to 5x that of the energy savings from the machine itself. To put this in context, taken together, a single HPGR can save up to 16,000 tonnes of CO2 equivalent per year. That's the equivalent of 10% of Weir's entire annual Scope 1 and 2 emissions. So our next step is to confirm our accounting framework for these avoided Scope 4 emissions and to seek independent verification. This will be compelling for our customers and gives us great confidence in achieving both our HPGR growth ambition and delivering against our scope 3 emissions reduction targets. I'll now summarize the key messages from this part of the presentation. Firstly, our most material CO2 emissions target is a direct shared interest with our customers. We are committed to a 15% absolute reduction in our scope fee by 2030. And that currently accounts for 97% of our footprint, and we're going to achieve this while simultaneously delivering our growth ambition. Secondly, our technology strategy underpins our growth ambition. Our customers' demand for more sustainable solutions will drive growth for our business and by increasing our investment in R&D, and aligning our resources to solving our customers' biggest challenges, we had accelerating mining's technology transition. And finally, we're working to quantify and validate our Scope 4 avoided emissions. In time, this unlocks the potential for green revenue recognition and compounds the benefits for our customers of using Weir technology. Thank you, everyone, and I'll now hand over to Chris to talk about how Motion Metrics technology is enabling smart, efficient, sustainable mining.

Thanks, Paula. Hi, everyone. I'm Chris Carpenter, Vice President of Technology at Weir ESCO. Today, I want to talk to you about Motion Metrics and how by combining it with Weir's mining capability is contributing to our growth ambition, while also helping our customers move less rock, use less energy and create less waste. Let me start with a brief overview of Motion Metrics. Motion Metrics helps miners with their productivity and safety challenges through the use of artificial intelligence and machine learning capability, coupled with 3D rugged cameras. This proprietary technology gives mining machines and their operators an extra set of eyes. This includes the excavator and cable shovels for which ESCO provides ground engaging teeth and buckets. Motion Metric systems are used to monitor the condition and performance of the equipment and also capture data on the size of rocks being moved. As an early mover in this space, Motion Metrics has a library of over a decade of data, which has been used to teach its artificial intelligence system. This gives it leading performance and makes it difficult to replicate. The core capability, which first attracted Weir of Motion Metrics is its toothloss detection system. This system gives machine operators real-time feedback of a ground-engaging tool or GET is missing from the bucket. This enables immediate retrieval and avoids costly downtime in downstream operations. Loss detection has recently been complemented by GET Weir monitoring capability, meaning teeth can be replaced at the optimal time to maintain machine productivity. This capability also opens a door to a vertically integrated digital supply chain in which ESCO is digitally notified when teeth need to be replaced and replacement teeth are automatically dispatched to the customer, in which ESCO is digitally notified when teeth need to be replaced and replacement teeth are automatically dispatched to the customer. Motion Metrics AI has a number of other potential applications in the mine. This includes fragmentation analysis capability, which can identify rock characteristics, including size, shape and distribution of rocks, enabling miners to understand critical data about the rocks flowing through their operation. By bringing Motion Metrics into Weir, we have created significant value. In addition to leading AI and machine vision capability, Motion Metrics has a high-caliber technology team of over 100 data scientists, hardware and software engineers and technical sales and support professionals. This capability is incremental to Weir and proving to be an accelerator as we pursue our digital growth ambitions. On the other side of the balance, we are bringing strong sales capability. At the time of acquisition, Motion Metrics was fundamentally an R&D organization with limited sales resources at a presence of only 80 mines. This compares to Weir, which has extensive sales network and access to thousands of global mines. Our footprint is, therefore, delivering a rapid adoption of Motion Metrics technology with 2022 revenue forecast to be more than double that of last year. However, the benefits don't stop there. Weir's deep-rooted mining knowledge and footprint across the pit and processing plant is enabling Motion Metrics to expand its value presence with its technology providing data insights across the mining flow sheet from mine to mill. This, in turn, unlocks the opportunity to sell outcomes to our customers using data to improve equipment performance and mine productivity. This includes optimization of the load haul cycle through the product to production partnership model, which we talked about in September. And also optimization of the mine to mill process using particle size distribution analysis. Further out as we evolve our vision technology, we'll capture data on critical ore characteristics, allowing miners to be more discerning about which rocks they move and how they process those rocks; moving less rock, using less energy and creating less waste. I'll now talk through each one of the 3 opportunities, starting with a brief recap of the product to production partnership model. In September, Andrew explained how we are combining Motion Metrics capability with ESCO's leading hardware to offer a package solution, which improves customer productivity and reduces energy consumption in the load haul cycle. GET and bucket design is optimized for rock conditions and compatibility with other equipment at the mine site, and adding Motion Metrics toothloss and where monitoring system reduces downtime, improves productivity and provides critical GET performance feedback to improve future designs. Its excavator payload monitoring system directly improves big efficiency by measuring how much material is being moved with each dig cycle, providing machine operators with critical performance data and reducing variation in bucket fill levels. This same data provides ESCO important insights to ensure the customer is using an optimized bucket in the most productive manner. Combined, this overall package is delivering increased mine productivity and uses less energy per ton of material moved. And through our production partnership agreements, ESCO is being rewarded for unlocking these benefits. Looking more broadly across the mine, Motion Metrics fragmentation analysis technology can determine the size, shape and distribution of rocks on the rock face, in the mining bucket, in the truck and also on a moving conveyor. This image analysis is often called particle size distribution or PSD. With PSD capability, Motion Metrics is expanding its value presence across the mine to the processing plant, where Minerals operates. This is unlocking another step on Weir's journey from a products to a solutions provider. The PSD data captured is enabling miners to understand what rock is flowing through their operations and how efficient they're crushing and milling processes are. Oversized material, which might block the crusher can be identified and diverted before it reaches the processing plant, avoiding costly downtime and the crusher process can be optomed and milling processes are. Oversized material, which might block the crusher can be identified and diverted before it reaches the processing plant, avoiding costly downtime and the crusher process can be optimized to suit the size of the rock. In addition, by placing Motion Metrics cameras at the start and end of the process, the mine operators can understand process efficiency. For example, by measuring particle size reduction in the crusher and correlating that with energy consumption data, the crushing process can be optimized to increase productivity and use less energy. Results from early adoption of Motion Metrics PSD solutions have been extremely encouraging. Feedback from customers is positive. Data sharing and collaboration have increased. This is deepening our customer intimacy, enabling us to think more broadly around how we solve their biggest challenges and consider how we evolve our business model to share in the benefits delivered. Given this early progress, we are really excited about the opportunity and expect fragmentation analysis to be a key growth driver for Motion Metrics in the years to come. Looking further out, we believe ore characterization and in-pit ore sorting has the potential to transform mining by moving less rock, using less energy and creating less waste. Ore characterization technology, which is underpinned by sophisticated sensing systems, captures critical data on properties and composition of rock, including rock hardness and mineral and moisture content. When coupled with Motion Metrics fragmentation analysis technology, it has the potential to be a game changer, giving miners a full picture of the size and characteristics of rocks. While ore characterization technology is nascent, we are and Motion Metrics are at the leading edge. We have laboratory validated equipment and field trials of our proprietary solution that are due to start at customer site before the end of the year. If successful, this technology opens the door to in-pit sorting, where miners complete the first stage of crushing in the pit and analyze the outputs to make real-time decisions about which rocks have sufficient mineral content to be moved. This is a step change from the current process, where energy is expanded in transporting and processing all of the rocks regardless of mineral content and with significant waste generated from 0 and low-graded material. Our vision is to move less rock, moving only the rocks with sufficient mineral content and using the data that is captured on size and hardness to optimize processing. The natural evolution thereafter will be towards real-time automation control of processing equipment, ensuring the right rocks are processed in the most efficient way, using less energy and creating less waste. While commercialization of this full solution is some way off, Weir's position across the pit and processing plant, plus our extended digital reach with Motion Metrics means we are well placed to pursue and capitalize on this opportunity. I'd now like to play a short video where Shahram Tafazoli, the founder of Motion Metrics demonstrates its capability to you.

Hi, everyone. I'm Shahram Tafazoli, Founder of Motion Metrics and Chief of Artificial Intelligence at Weir. When I founded Motion Metrics over 20 years ago, my vision was to use technology to make mining safer, more efficient and sustainable. I'm now delighted that Motion Metrics and our team of 160 people are part of Weir. I'm particularly excited about how the group's global sales footprint and deep prudent mining knowledge across both ESCO and Minerals can help us achieve that vision. Today, I'm going to show you some examples of our proprietary AI and rugged machine vision technology in action. Let's start with our flagship product, shovel metrics, and it's missing tools detection and payload monitoring capabilities. Here on the screen, you can see an extract of what a shovel operator would see in their cap. The green color teeth indicates that all bucket teeths are present. While the pay note monitoring scale shows the weight of the material in the shovel bucket as well as material already loaded onto the truck. Now you can see that an alarm has been triggered. And one of the key indicators has been [indiscernible]. This is providing fast feedback to the shovel operator that the tools is missing and may have been dropped into the haul truck with the payload. Immediate action can now be taken to divert the truck with the lost tools away from the primary crusher, preventing disruption on downstream conveyor bills or downtime due to a jammed or damage crusher, a common and costly problem at every mine. Shovel Metrics uses a ruggedized state-of-the-art high-risk color 3D camera mounted on the shovel boom with a clear view of its bucket. Our proprietary machine learning algorithm can determine from the sequence of 3D images, whether all teeth and lift shocks are present or not. In addition, it can measure the length of each tools, calculate their Weir rates, detect molders and automatically delineate each rock using its 3D coordinates to provide accurate rock fragmentation analysis or particle size distribution data. Customers can access the data security from each shovel equipment system from anywhere on earth via our secure cloud-based platform. Now let's fly higher. Here, we are circling above a large copper mine in Central Asia. The mine is vast. But as we zoom in a whole ecosystem of Motion Metrics technology has been deployed in various stages of mining and processing with the overarching goal of making the mine safer, smarter and more sustainable in a data-driven manner by preventing loose GET and large molders going into the processing plant and by sensing various attributes of the routes, such as volume, payload and fragmentation at each stage, we bring visibility to the most unknown part of the whole mine and enable the mine to operate with eyes open. Starting with the drill and blasting stage, operators can assess blasting efficiency safety from the field with PortaMetrics, our handheld 3D rock fragmentation analysis device. Shovel Metrics then provides key metrics and payload data at the loading stage. Haul trucks headed to the crusher are scanned by Truck Metrics and Crusher Metrics to monitor rock sizes and load volume characteristics. Finally, we are expanding our presence in the mine all the way through the mill circuit, where our Minerals division operates. The processing throughput and rock sizes can be analyzed with BeltMetrics in real time, find the staff of any inefficiencies so they can take informed and rapid corrective actions. Our systems provide unprecedented operational awareness, which is critical to improving the operations, productivity and environmental footprint. And this is all done without interrupting the workflow. It's been a pleasure to share with you the exciting work we are doing here at Motion Metrics. Thanks for listening.

Thank you, Shahram, and hello, everyone. It's great to be joining you. I'm John McNulty, Vice President of Technology for the Minerals division here at Weir. And today, I'm going to talk to you about tailings, what they are and why they're a high priority for our customers. I'll explain how our Terraflowing integrated solutions for tailings support our growth ambition, helping customers use water wisely, use less energy and create less waste and how we are boosting performance across the Minerals flow sheet with Synertrex digital solutions. Firstly, a bit of context. Tailings are the waste stream produced in conventional mining processes. They are a slurry of waste rock powder and water with a liquid content that's typically around 45% by weight. And an average copper mine, 99% of mined rock ends up in the tailings stream. And with typical mineral contents and ore bodies below 1%, that means that for every ton of rock processed, you get 10 kilograms of copper, but you also get 990 kilograms of waste material, and that goes to the tailings. In fact, mining produces a staggering 19 billion cubic meters of tailings each year, the biggest waste stream on the planet. In mining, there are 3 principal methods used for dealing with tailings. The traditional and most widespread today involves pumping waste streams to large tailings bonds where they are stored indefinitely. This requires safe and energy-efficient transportation [indiscernible] pumps, coupled with our -- cyclones provide a good solution. However, with such large volumes of waste, land capacity for the tailings pond itself is a significant consideration. And so is the water content, as the more water that's contained in the waste, the more unstable the tailings become. And as we know, this has given rise to a number of very tragic dam failures in recent years. Tailings ponds also tie up large volumes of water, which is an issue, particularly in water-stressed areas such as Peru, Chile and Australia. So there has been increasing pressure and miners to look for safer, more sustainable options. And with it, a need for technologies that can reduce the water content of tailings to enhance the stability, decrease the amount of land area required and reuse water in other parts of the process. For this, there are 2 further methods. Thickened tailings, where the waste stream is dewatered to remove up to around 85% of the water. This creates a stable tailing stream, rather like toothpaste, which can be moved with special pumps with extracting water recycled back into the process. The other approach is called Filtered tailings, which essentially removes more water from the waste stream to produce a relatively dry waste and reusable water stream. The Filtered tailings are typically conveyed or transported using trucks. As shown in the table on the right, when choosing a tailings approach, the challenge for miners is to optimize water preservation and sustainable long-term stability with the lowest possible energy use and emissions. We as proprietary tariff flowing technology based on the thickened tailings methodology or pace is a sweet spot solution for water, stability and emissions. And because customers' tailings needs vary from mine to mine, it isn't a one-size-fits-all solution. So we are using our unique combination of best-in-class technology, engineering expertise and understanding of Mines priorities to develop integrated solutions for tailings that are true to our customers' needs. We call this Terraflowing. And on this slide, you can see an example of the process flow. We have cyclone and screening technologies to improve water and sand separation and create a dryer and lower volume waste stream. And if the tailings particle size composition allows it, we can extract sand from the tailings for use in dam wall construction. This further reduces the volume of tailings that has to be stored and extracts value from the tailings waste stream. Overall, we are able to remove up to 85% water, which is then recycled back to the process plant. The resulting pace may be too thick for conventional pumps to handle. Here is where we bring in our Geho pump technology, which is the market leader in pumping dense pace with a low water content. With Geho technology, we can pump these dense pace effectively over very long distances if required, allowing miners to store applications there may be some distance from the mine without having to use trucks for transportation. More generally, the pace produced via Terraflowing are relatively stable and require substantially reduced storage volumes thereby extending the life of existing tailings storage facilities. You may be thinking, why pump as a pace when you could filter technology to remove even more water. The issue is energy use and the associated costs and CO2 emissions. Our engineers have correlated the content of the pace with the energy and the CO2 emissions produced comparing Weir's Terraflowing technology with a filter tailings solution. And although the total water recovery is 10% higher for filter tailings compared to past tailings, it is offset by 2 to 4x more CO2 emissions. There will be circumstances where filter tailings are stipulated by local legislation and the customer has no choice but to use it. However, our analysis clearly shows that Terraflowing provides lower total cost of ownership to achieve a result very close to filtration, a perfect example of TCO squared with a high profile of tailings and the need for smart, efficient cost of ownership to achieve a result very close to filtration, a perfect example of TCO squared with a high profile of tailings and the need for smart, efficient and sustainable solutions, our Terraflowing technology and integrated solutions underpins our ambitions to grow ahead of our markets and minerals. Let me share a short case study, an iron ore customer in Mexico needed a tailing solution to help them meet their future production targets. Working in partnership with the customer, our engineers developed an innovative integrated solution, which combined re-cyclones, warm in pumps and endurance screens, replacing the mines existing basic thickener plant and extracting a valuable side stream of construction sand for dam wall raising, and substantially reducing the overall volume of tailings produced. The Terraflowing solution will increase water recovery by 35% providing more processed water can be reused and resulting in a significant reduction in wet tailings. And the solution around the case, the need for a new tailings dam, therefore, delivering significant cost and environmental benefits for the customer. Customers have always chosen highly engineered solutions for the highest productivity with the lowest total cost of ownership. And as I've just explained, we're now turning TCO into TCO Squared with our sustainable solutions. As we continue to evolve our technologies to maintain market leadership, we are launching an upgraded generation of a proprietary platform, Synertrex, which boosts digital performance for our customers. This digital overlay is an essential part of our integrated solutions, enabling them to operate at best efficiency. And in the case of Terraflowing, producing optimum water and energy savings. Furthermore, maintenance can be optimized and planned, thereby improving overall efficiency of the equipment and enhancing productivity in the mine. With enhanced features I have just described, our second generation of Synertrex creates intelligent equipment and is the most powerful ecosystem available on the market for this application. Synertrex provides data-driven insights on our equipment, while Motion Metrics generates complementary insight on those processes within the mine. With these 2 platforms, our strong positions in mining technology and our growing AI expertise, we see exciting opportunities to develop enhanced and optimized ecosystems. These will drive growth for Weir and deliver smart, efficient and sustainable solutions for our customers. Thank you, and I now hand you back to Jon.

So pulling together what Paula, Chris and John have just described. As we look across the value chain where we operate, the positive impacts of our individual technologies are substantial. However, the most exciting opportunity for both Weir and our customers comes as we increasingly connect and integrate them. And when we do, their positive impacts are compounded delivering sustainability benefits that are even greater than the sum of the parts. In our vision of the mine of the future, in the pit, Motion Metrics enable ESCO equipment means only all with the right mineral content will be selected, while movement from the pit to the processing plant will be optimized, meaning less rock is moved and less energy consumed. And with only the right rock entering the processing plant and processing via an integrated flow sheet of Weir technologies, water will be used wisely and energy consumption reduced even further. All the energy and water consumed will be in the processing of higher grade material, not waste. In turn, this means less waste per tonne will be created as tailings. And for the waste that is produced, Weir has the right blend of technologies to find the sweet spot, which balances water recovery with tailings stability and a strategy consumption. With our proprietary digital systems overlaid, technologies across the mine will communicate with each other and to the operator, optimizing the operating conditions at every stage of the process and preempting and resolving potential issues. With our leading technology portfolio, Weir is and will be a critical supplier to our customers, helping them achieve their sustainability ambitions maximizing productivity and minimizing environmental impact, and summarized in a compelling value proposition of not only lowest total cost of ownership, but TCO squared. So in summary, Weir is a leader in mining's technology transition. Mining is critical to a net zero future, and sustainability is critical to mining. With our technology and solutions, we are reducing our customers' footprint and making their operations more sustainable. And as we've described today, our technology strategy is focused on helping our customers solve their biggest priorities. Sustainability and technology are therefore fundamental to Weir. Our customers' demand for sustainable solutions underpins our mid- to high single-digit growth ambitions and also the delivery of our own goals. So it's a win-win situation. So as we turn back to where we started, I'm really excited about the future of where we're in the right markets and positioned for long-term growth. And with our unique capabilities and technology, we are well placed to deliver for our customers and for the planet. It's these factors which, therefore, give me great confidence in reaffirming our commitment to excellent outcomes for all our stakeholders, compounding growth, margin expansion, strong cash conversion, best-in-class resilience and a compelling sustainability road map. Thank you very much for your time today, and we'll now move on to Q&A.

[Operator Instructions] We've a question from Christian Hinderaker of Goldman Sachs.

Hopefully, I can take 3 questions, if I may, and then happy to them in turn. Starting with the first one. You've highlighted the GBP 500 million opportunity from digital capabilities within ESCO. Just interested from your customer discussions and long-standing experience in the marketplace, do you expect that opportunity to come in the form of increased aggregate CapEx across the sector? Or do you think it's going to come within existing CapEx budgets and therefore, represent more of a market share gain opportunity for you? And then I can come back to the second 2.

Christian, thanks for the question. I should just say that you've got myself and Paula in London and then also virtually Ricardo Garib and Andrew Neilson. So they can pitch in as we go through. And I should also say that I know that some people are on the phone lines, but there's also a facility via the webcast to type in questions. So if anybody wants to use that facility, please do so, and we'll try and coordinate that. But let me start with the answer to the first question. The GBP 500 million market opportunity that we have sort of set out in relation to digital is really our view of what the potential market will develop to for technologies such as Motion Metrics, which have eyes on the mine, and we'll provide data and insights to drive more efficient, and safer operations. So it's our view of what the emerging market will be. My expectation is that, that will not be a CapEx-driven market actually. So if we think about it today, the Motion Metrics model from a revenue perspective is sell the hardware upfront and then have a subscription sort of license for use of the AI and software over multiple years. And I think that will remain a model. But increasingly, I think there will be further OpEx type models that will be the key driver of that market. So I don't think we necessarily need there to be an increase, if you like, in terms of CapEx budgets to enable that market. I think it will come out of OpEx by and large, and therefore, will be driven by operators on the mine who have very clear goals in terms of improved efficiency, eliminating downtime, reducing waste and so on, and we'll be selling into that kind of person, if you like, on the mine site.

Thank you, Jon. That's clear. You've outlined secondly that the market needs to see $23 billion a year of CapEx on new copper projects in order to meet new global climate targets. But obviously, we've yet to see really any meaningful greenfield announcements permitting, I think some of the things you flagged as one of the obstacles here. I'm just interested in what you're hearing from customers at the minute in terms of expansion plans as it relates to those permitting issues and, indeed, any sort of more near-term considerations about the macro environment.

Yes. So I think the overarching point is that we need a lot more copper than we are producing today. You saw some of the numbers in the slide pack, up to 10 million more tonnes of mined copper per annum, which is a very significant uplift from where we are today. My view is that in terms of surface mining projects, there is not enough in the pipeline to do that. My view is that -- our customers are working very hard actually to try and identify new projects, to accelerate projects, to bring forward projects in a way that will enable to fill some of the gap. But even then, I don't think that's going to be enough. So I think you will also see an increase in or development of new recycling technologies, potentially development of deep sea mining in due course and further evolution in terms of potentially chemical and bacterial leaching of copper. So I think the only way we're going to get there is sort of all of the above. So I think we will see, over the next few years, a scramble, if you like, to figure out what are the different levers that the mining industry needs to pull to really start to generate the increase in production of copper. But for where it's sort of -- we're sort of slightly agnostic to where it comes from is a win-win situation for us. Clearly, if there are large new projects coming through, then that's the opportunity for us to bid for new installed base. If there is new technologies emerging in terms of bacterial leaching, for example, chemical leaching, today, we are the world's leader in the pumping of sulfuric acid, which is going to be -- will be a key feature on that. So -- and our general process equipment would be required in that space as well. So -- and I think fundamentally stepping back, if new expansions, new greenfields don't come through rapidly enough, then you're just going to see an increased focus on existing brownfield mines, how do we accelerate the development of the mine? How do we produce more than we'd originally planned? How do we sort of scale up the process plants in a way that will allow the production of more copper or other metals from existing mines? And that's really the sweet spot for Weir. So the way that I think about it is it's sort of a win-win for us, which is -- it's very difficult to predict how, where the new copper is going to come from. But whatever happens, Weir is incredibly well placed to take advantage of that growth.

And then thirdly, the 30% Scope 1 and 2 emissions target by 2030. Just interested in what you see as the main actions required to meet that goal and whether it can be achieved within existing CapEx expectation.

Paula, do you want to take that one?

So there are 2 main levers for us to get to the Scope 1 and 2 targets. So first of all, first and foremost, this efficiency. So we really want to drive efficiency in our operations. Electrons use, whether they're renewable or not renewable or still costing. It's a big component of our cost base. So number one is efficiency. And then secondly is where we can't drive through efficiency measures, of course, we can only get so far, is then shifting to lower carbon energy sources. We've driven that really hard in the last year or so, significant movements in Australia, Malaysia and South Africa to name some examples, that are really starting to move us over there. But we are -- we do saw a little bit of a headwind in some countries that we operate in. China is a bit trickier to get those low carbon supplies, some areas of North America. So eventually, at some point, we will need to have Energy Attributes Certificate or [indiscernible] strategy to get to our final 30% goal. But we want as much as possible to do it through efficiency and through real renewable contracts rather than anything that's more of a technical construct. We don't think that we will need to use any carbon offsetting to get there. That's not part of our strategy. And in terms of cost-wise, we're finding in almost every case that it's actually cheaper. I mean the cost of renewable supply is going down all the time the technology is getting better. The payback is certainly getting shorter. And in quite a lot of cases, we've actually found it's been a win-win. It's been a CO2 saving and a cost saving for us. So it generally is a really proven quite a fruitful strategy.

Okay. Thanks, Christian. I've now got 3 questions from Jonathan Hurn at Barclays, which we'll take in turn. The first one is, can you take us through the addressable revenue opportunity for your Terraflowing technology? So I'll just give an overarching answer on that and then ask Ricardo to comment specifically. Jonathan, the way that we're thinking about the technology pipeline that we have is to say it's quite difficult to put a number on the revenue opportunity at this point, but we're building a portfolio of new solutions and technologies. And frankly, some of them we're hoping will be incredibly successful. Some of them might not fly as well, but it's about building a basket of options, if you like, in new technologies that we're the market. And then my view is that when they reach a certain scale, we'll be able to say, okay, now we've got evidence of the trajectory that we're on in relation to this particular technology theme, and then we'll start to put a number and a framework around it. So I think I would say that HPGR and comminution is a great example of that, where earlier this year, we said, right, we can now see the trajectory that we're on. We think that business is now capable of being tripled over the next 5 years to a sort of GBP 400 million, GBP 500 million business from where it is today. So you've now got a sort of a framework, if you like, for where we think we can take that business. If you look at Motion Metrics and some of the other new technologies such as Terraflowing, then they're in the low sort of GBP 10 million, GBP 20 million sort of range at the moment. So I don't feel we've got the scale to say, look, now this is what the number is going to be in 5 years' time. But as they grow, then we'll start to put numbers so across the basket of technologies that we've got emerging, you can start to put a frame around that. That said, we are very excited about Terraflowing and the sweet spot that we've created with that technology. And I'd just like to ask Ricardo to talk a little bit about the opportunities that he sees for use and adoption of the Terraflowing technology and maybe some of the examples that we're seeing already. So Ricardo, if you could just give a bit of color, that would be really helpful.

Thank you, Jon, and good day, everybody. Yes, Terraflowing is absolutely a tremendous solution proposal from the Weir Group. I think we're unique that we can put together not only how we can squeeze water out of the tailings, but also how we can convey and transport tailings both in what we call paste, basically it's like a very dry [indiscernible]. We have a really good example that was last week in Mexico where one customer survival opportunity is because of Terraflowing as they are using water that comes from a river and compete with a very productive agriculture valley. So now that customer, in particular, saving [indiscernible] water retracting through the process instead of using mostly fresh water. Our proposal in Terraflowing is picking up. As John McNulty showed a video, we have 3 stages, just combined tailings, creating a paste what we call a dryer tailing and also the last stages filter and moving customers from Stage 1 to Stage 2, I think, will be paramount, especially in places where water is scarce or water competes with agriculture or city needs. And again, just to repeat myself, we have probably a unique proposal in the market, we can put everything together, screen cycles, pumps into one unique solution. I hope that's just one of the questions, Jon.

Yes. Great. Thanks, Ricardo. Jonathan's second question is to develop your digital offerings, do you think more M&A is needed? Or can it be done organically? And I'll take that one. I think -- Jonathan, we think about a digital offering in the same way as we do the entire portfolio of products and solutions that we have, which is to say we put in place an organic growth strategy to develop that offering and that value proposition to the market. And then if we see acquisition opportunities that will accelerate that organic strategy, then those are the sorts of things that we'll be very interested in. And if I take the 2 divisions, it's quite clear. If you look at Minerals, we've really developed organically our digital offering there, which is essentially the Synertrex platform and field service platforms that we're developing off the back of our SAP ERP system. So we're doing it all ourselves there. Again, if there's an opportunity to acquire something that will accelerate that, then that will be of interest. In ESCO, with Motion Metrics, we've taken -- we were developing ourselves organically, and then we found this wonderful business, which really leapfrogs us forward in terms of the offering that we have for the market. The depth of artificial intelligence capability that it brings into the business is very, very significant. And so we have our eyes on some other tech things which may accelerate and if the right moment comes along where -- as you know, M&A is opportunistic. But if the right moment comes along where we can bring those things into the portfolio than that to accelerate our strategy, then that's going to be very attractive to do. And I would say we've now owned Motion Metrics for 12 months. And as a team, we're all incredibly excited about what that's bringing. Our eyes have been really opened hugely to the opportunity that is now bringing to provide new insights and data to our customers to have eyes on everything that's going on across the mine, as you heard from as you heard from Shahram, which has the potential to be game changing to my mind, if we can get to mass adoption. So early days, but very, very exciting if we can find other businesses like that, then that would be great. The third question, Paula, is what is the expenditure or cost needed each year? To me, your Scope 1 and 2 emission reduction target as we look to 2050, do you think more will be needed to generate net zero Scope step 1 or 2 emissions?

Yes. I touched on this a little bit in the earlier question. But yes, I mean, there's 4 main areas that we can look at for that target. So there's CapEx expenditure around efficiency where we may need to replace boilers or replace equipment. As I said, the payback for those is getting way shorter than it ever was before. So I don't have a year-by-year rate, but it's not significant. It's not material. And in most cases, they've got pretty short paybacks. We're also looking where possible where there's a leverage funding that we can get to get some support for those in some countries. The one I didn't touch on earlier is the behavioral change. And Jon mentioned this a little bit in his earlier part of the video. Some of this is just very simple. It's the equivalent of getting your kids to switch the light so when you leave the house, we're leaving equipment running. Every organization hasn't had inefficiencies, but there's things like just really, really rigorously, switching things off, turning things down and the behavioral change that goes through the whole of the organization. And I think one of our operations directors said that they see more engagement in this than they've ever seen in any initiative in our whole time in Weir. The passion behind this from all the people in the organization, this is a sort of thing Scope 1 and 2 is something everybody can do something about, whether you work in an office, whether you're working on a really high intensive machine -- energy-intensive machines. So it's creating real value from us on an engagement perspective as an organization as well in driving down those costs. So those are the things to reduce the consumption in the first place and then to change the impact of that consumption, it's about changing to renewable contracts or having some self-generation as well as was touched on the video, we're moving more and more to actually -- we have a lot of operations in very sunny climates and we're managing to move more and more to self-generating on our own sites. So the combination of all of that means it's, as I say, I don't have the number to have, but it's really not material. And in many cases, actually, it's financially positive for us to get there. The challenge remains for us. So the challenge for us to get there is not financial. The challenge for us to get there is some of the countries that we're operating still not having good access to renewable supplies, but that's something we're working on every time we invest somewhere new in the countries that we are having more challenged with right now.

Thanks, Paula. I would just reiterate what Paula said about the sort of cultural and behavioral piece of this. It is -- I've just been blown away by how much pull from the organization we've had for the many sustainability initiatives that we've put in place because back to what Rosemary said about the culture and the kind of environment we're trying to create, people want to do something meaningful, and they want to do things that are going to help and deliver on the company's purpose, put their own personal one. And you can see that, I think, in the engagement that we're getting and just the huge amount of pull from the business for the projects that are going to drive down our CO2 emissions. So I think the traction that we've got has just been utterly phenomenal. And to the point about some of the more difficult countries, what's been great is that we look to places that we do operate such as the southern part of the United States. South Africa, where historically, we've been -- really our electricity comes from coal-fired generation. So we thought that was going to be quite difficult to tackle, but we were in South Africa a few weeks ago. And we've just built a 1 megawatt per hour solar plan on the roof of one of our facilities. We're trying to figure out how we can do the same on another. And that has the potential to take out almost half of the electricity that we're buying from the grid, which is unreliable grid and a grid which is coal-fired. So where we can do that, we're running hard to do those things, and I think there's much more of that to come. Okay. So we have another question from Harry Thomas of Trium Capital, which say companies such as Jetti Resources have potentially attractive future solutions for copper, both in terms of yield, cost and emissions. How do you view these potential competitive threats? And are you looking at this area from an M&A or R&D perspective? So it's a great question. And I think it's something I sort of partially answered earlier on in terms of where is the new supply of copper going to come from. And my personal view, it's all of the above. It's going to come from working the existing surface-based mines that use flotation processes, of which there is trillions of dollars in invested capital, by the way, they need to work much harder. We need to identify and develop new mines, which will also add to the solution, the evolution of chemical and bacterial leaching type processes, such as with Jetti, I think, could have an important part to play, albeit it's a very small scale at the moment. But if you think about the movement of earth, the liquid-based processes are going to be required to do that then, again, that plays into the product portfolio that we have. And we are -- to your point, we are sort of looking at also from an R&D perspective as to how we can -- and in the sort of theme of integrated solutions, how we can play more into that space. So frankly, I'm sort of viewing it as not as a competitive threat, more as an opportunity. And part of the solution where we all have to work together to figure out where the copper and other transition metals are going to come from. And so it's very much something that we're looking at in terms of our technology foresighting and the R&D pipeline, whether that would, in that case, evolve into an acquisition situation, I'm not sure yet, but we would always have our minds open to that. So -- and another question, sorry. So this is from Debashis Chand from SocGen for Paula. Could you give a bit more detail on where you are in terms of your calculations of the Scope 4 savings? And what is the approach you're adopting? Is it based on your installed base or on your technologies.

Yes. Thanks. So first, I'd like to start with saying about Scope 4 is I feel really strongly that Scope 4 is by far a much more scientific measure in measuring impact in green revenues. It really does capture the essence of what capital goods companies can do in terms of driving energy efficiency, and that's why we think it's such an important thing to measure and quantify accurately. It is very complicated. So what we have chosen to do is, do it by technology and then look at the installed base of that technology. So many do sort of top down and look more about potential validation. What we're doing is doing it bottom up, looking at the products that we think have the biggest impact because with all areas of our sustainability road map, we always have gone from materiality first where we think there's the biggest impact. So we started with HPGR and also one of our Warman pumps. And that's the numbers that we talked about in HPGR in the presentation. We've done that by doing a full life cycle analysis that we've done with a third party using third-party database, third-party tools, and we're looking to have third-party validated. It's not done yet, but we're looking to have that done. That has validated what we already knew that more than 97% of our footprint is with our products in use in our customer sites, which gives us real push towards that avoided mission Scope 4. And so we've done life cycle analysis. You have to have a competitor in technical terms, the counterfactual for Scope 4 to be valid. So we've compared that to tumbling mills. We've thought through operational assumptions, both in terms of where that product is operating, how many hours it's operating for the lifetime of the product and then put that all together to come up with the numbers that we're looking at now. As you know, Scope 3 is a product in use for the lifetime of the product. Scope 4 doesn't have the same degree of definition yet about what you should use as the light of the timing comparison. So for the numbers that we've been talking about now are annual comparators. But what we're aiming to do is build up over more of our portfolio next year. So we would determine those as our Phase I products. We wanted to, one, prove the concept before we then started rolling out more broadly through the organization. So we've done those as we think the bigger ones to look at. And then we plan to roll out, as I say, to more Phase II products next year and to start thinking about setting a target. I think part of the question was when we think about setting a target. We'd like to be able to do that as soon as we possibly can. Once we've once we have our Scope 4 process and methodology validated, we'd like to start setting a target against that because we really do think you can't offset 1 against the other. We're very clear and we're not trying to, but we really think looking at Scope 3 and Scope 4 together for us as an organization will really show where we're making a difference. Because as we said, if we keep selling more really highly energy-efficient products, if they're 50% more efficient that we sell twice as many of them, we stand still on Scope 3. So what we need to do, but what we are doing is pushing another product that's less efficient out of the market. So the societal impact is the positive. That's where you measure the positive societal impact by looking at Scope 4 and Scope 3 together, wholly recognized and you can't offset one against the other, but looking at the 2 together gives the whole picture.

And there's a follow-on question on time line in terms of reporting on Scope 4 savings, Paula?

Yes, I mean, I'd really hope to be able to start setting target next year and then holding ourselves accountable to that. Because I do think we've got a lot to say, now watch the space and say, we need to have it verify and validate it. But I think it's really important for that telling the whole story. Because I say green revenue is blunt tool. They don't show what the actual impact is but the Scope 4 really does.

Absolutely. And a follow-on question on HPGR. It sounds like a key technology to deliver the Scope 4 emission savings. Can you give a bit more detail on your existing installed base in terms of units? And what's the key differentiation of your HPGR offering versus the existing competition in the market? So I can give a little bit of color about the installed and what's the key differentiation in the market. So I can give a little bit of color about the installed base and then maybe Ricardo come in on the technical differentiation of our products relative to the competition. So yes, I mean, for us, HPGR has been something that we've been passionate about for over a decade now in terms of the technology that we initially acquired and then upgraded to take to market. And as we said before, been very, very successful in terms of market share gains over the last few years. We've won circa 80% of the large-format HPGR projects that have been bid. So we've got a rapidly growing installed base. But it's probably still in the tens of units at the moment versus the hundreds. And in terms of the competition on the sort of the previous technology, if you like, there's probably an installed base of around 150 machines where we actually compete for the aftermarket. We will compete for the replacement cycle as that comes through. But a lot of the growth will come from both greenfield expansions where we expect HPGRs will increasingly supplant the tumbling mill technology for the reason that Paula talked about in the conversation. But to the extent there's a lot of brownfield modular expansion opportunity then HPGR is absolutely perfect because you don't need to replicate the whole sort of process plant, the concentrator with the old technology. You can add modular HPGRs to add 10% and 20% more capacity to our processing circuit. So we think it's perfectly placed to do that. So it's a slow burn at start. We've got real, real traction over the last 2 or 3 years. And obviously, as I said earlier, we've now got quite an aggressive growth target for what we aim to deliver over the next 5 years. And then, Ricardo, if we got asking you to just sort of comment on the technical differentiation of our HPGR versus the competition.

Yes. Thank you, Jon. Happy to do that. Basically, our machine is absolutely designed for a mining application. While our competition started from modifying machine design for cement, we did the same. We [ stopped ] for 3, 4 years, and we completely redesigned equipment. So we can guarantee 3 things were important. One is that a very low [indiscernible] load because our machine is wider and bigger. The second thing is that we can open and close the machine if we find any, what we call, uncrushable. I mean, any piece of a strange element coming to the machine. The machine will liberate it and not destroy itself. And the third one, we believe that our digital proposal, whether artificial intelligence of the machine and the scanner will make it adjust to what the different conditions are. And also want to add what Jon said in terms of the growth. We see good opportunities on brownfield expansion, as Jon mentioned, especially modernization, but also what we call on pebble crushing. Most of the mines, especially the hard ores, have large amount of pebbles sitting in stock yards and [ HPGR ] equipment to crush those and put back into the system. So I hope that answers the question, Jon.

Thanks, Ricardo. I know Ricardo is very passionate about pebbles. So let me explain, these are not the things you find on a beach. Through the tumbling mill process when you normally have jagged rocks, which get broken by the grinding media, but some elements of the ore once you've knocked the corners off, they've become rounded like a pebble and you can't do anything with them. They won't break down any further through the traditional processes and they get discarded. So many mines have mountains of pebbles, which they haven't been able to process which are just sitting there. And that's a fantastic opportunity because they will get ground up by an HPGR very readily. So we've got lots of sort of bids in the pipeline at the moment to go after the pebble mountains that are sitting in some of the mines around the world. And then another question from the webcast here, which I think is for Andrew. So on Motion Metrics, how has the integration gone? And what's your ambition on the size it can become? And of course, Andrew, you're moving to Minerals on the 1st of January. So this is going to be for Sean to deliver, so how about it?

Yes, I mean I think, personally, in terms of integration, we're really pleased with how that's going and as [indiscernible] might be as smooth as we could have hoped, we've really [indiscernible] the business well. We were sensitive to the risk of a traditional engineering company coming in and buying a technology company and not respecting the cultures or slowing it down. So we're really pleased that indeed, all the key technology guys are still with us. And the employee turnover has actually been the lowest for over 4 years. So really pleased our integration has gone. And indeed, the collaboration that we've already seen in the first year with ESCO, we're really using our sales channels to drive the growth. Jon referred to earlier. And using our mining knowledge to really sharpen and help define the proposals and the production partnership models and the insights that we can get from the data. So we're just scratching the surface, I think, in terms of the value we can provide to our customers by using the AI technology, the rugged camera technology and the amazing database of images aligned with our insights into mining, what we can do for the customer. So in terms of how big it can get. As John said, we're expecting to roughly double to around GBP 20 million in revenue this year. We would expect to continue growing at a fairly rapid rate. And I won't put [indiscernible] on it. We are really -- as you saw from the video is excited where we can go over time with this. I think we're just scratching the surface with ESCO and indeed just started the conversations with Minerals. So for example, right now, we are looking at using these cameras and this AI technology on the input and the output of an HPGR to produce that closed circuits that Ricardo referred to. As we're doing that, we're aiming to move the technology to smaller and smaller particle size, which opens up opportunities not just at the primary end of the crushing circuit, but more into the secondary and potentially tertiary as well. So yes, I wouldn't put a number on it, but I think you can tell from enthusiasm coming from across the piece. We are really pleased how integration has gone. And I think we all just see so many opportunities. It's really about how do we now prioritize and go after that, but ideally try and scale as quick as we can.

Yes. Thanks, Andrew. I've got -- there's a follow-on question here, again from Harry at Trium, which is, is x-ray or something similar to assess the ore grade potential addition to Motion Metrics? So I'll take that. I think, yes, what Motion Metrics today is doing is obviously giving our customers' eyes on in terms of the fragmentation of the rocks, which again, as Chris and Shahram and the video explained is very, very valuable to customers in terms of being able to fine-tune the process and eliminate downtime and so on. But the next question is, well, okay, we understand the size of the rocks, but we want to know what's in those rocks? So again, you can be discerning in terms of ore sorting. So you're only processing the high grade rather than waste material. And there are multiple competing technologies, mostly at very early stage around that, x-ray, hyperspectral, among others. So there are sort of various start-ups looking at that. We're looking at that from an R&D perspective in terms of working with academia on various ways that you can potentially generate a signal from the rock to say what's in it. So that is an exciting further addition. So -- and again, it comes back to what I said about how we execute our strategy. We are spending dollars on that from an R&D point of view at the moment to try and drive it organically. But again, there may be acquisition or partnership opportunities in the future with other technologies just as we did with Motion Metrics. So that's a bit more sort of futuristic if you like, in terms of the technology. And of course, as with everything in mining, whatever you bring has to be completely ruggedized and able to operate 4,000 meters up in the Andes or in a highly humid tropical part of the world, wherever the mining is. So getting these technologies to work in a lab, getting them to be ruggedized and scaled so they can work in mining is no easy feat, I can tell you, but we're definitely working on that. And I think there's one final question, actually, which is following on from the comment on sulfuric acid pumps. Is it possible to quantify the revenue opportunities in a mine using leaching versus traditional mineral extraction methods? And that's quite a difficult one to answer. I think as the other question about Jetti Resources, there are emerging technologies, which will potentially enable more leaching to take place through new technologies than is being done today. But leaching already exists in quite a meaningful way. So when a new greenfield project starts, it's very typical that the surface substrates of the ore body will be mined and the metal, be it copper, or whatever extracted through a leaching process. And then you move on to more of the sort of the flotation process as would be typical in copper. So it's difficult to quantify. What I would say is that if -- certainly if a chemical leaching accelerates, then as given the position that we have globally with sulfuric acid pumps, then that could be another very good revenue generator for us as we grow from here, but quite difficult to quantify at this point in time. But I'll just come back to what I said earlier. Hopefully, what we're trying to demonstrate today is that we've got to build a broad portfolio of technologies. Some of them are at early stage. Some of them have the potential to generate very significant revenues over time, but very, very clearly give us the underpin for our target of growing our revenue mid- to high single digit through the cycle. So I'll just confirm there are no more questions. So with that, thank you very much for participating today. We hope you got something out of video and the Q&A. And of course, if there are any follow-up questions, once it's all been digested, then please contact us directly through our Investor Relations team, and we'd be very happy to continue the conversation. So thank you very much, and have a good weekend.