First Tin (LSE:1SN) — Full Year 2022 Investor Presentation

0:01 Good morning, ladies and gentlemen, and welcome to the FIRST TIN PLC Investor Presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged. They They can be submitted at any time via the q and a tab that's just situated on the right hand corner of your screen. Please just simply type in your questions and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company will review all questions submitted today and publish responses where it is appropriate to do so, and these will be available via your investor meet company dashboard. Before we begin, if I may, I would like to submit the following poll. And if you could give that your kind attention, I'm sure the company would be most grateful. And I'd now like to hand you over to the executive management team from FIRST TIN PLC.

0:47 Thomas, good morning, sir. Yeah. Good morning, Mark. Thank you very much for the introduction, and warm welcome to all of our investors from my colleague, Tony, our technical director, and myself to welcome you to our investor call. We would like to inform you about the results that we published today as well for the year 2022, as well as to give you an update of all the operational achievements that we managed so far. So let's start with the presentation. Disclaimer, I believe you have read that already

1:33 carefully. What's about FIRST TIN? FIRST TIN is owns two assets in low risk jurisdictions in Australia as well as in Germany. We'll become one of the very, very rare tin suppliers suppliers to the tin supply chain with no criticality because there is no child labor labor. Even more, tin is still a very scarce material and will remain scarce. We will jump into that topic later on and discuss about the overall availability of tin. We own the two projects that represent themselves with a very, very fast pass to production due to their very mature status that they have already reached and as well due to the simple mineralogy and even more due to the reason that for both of the flagship assets for Tauranga in Australia and Teleheuser in Germany, there exists a chalk compliant resource statements.

2:50 We delivered, like promised, and started during the course of the last year, our definitive visibility studies, one for Tauranga in Australia, which we started jointly with Minkor that took the challenge jointly with us to manage that, and one in Germany for our Teleheuser asset that is performed by DMT. We have very robust economics and show high profitability at TIN prices of $25,000 per ton of TIN, which is equal and to the long term forecast from market forecast companies.

3:35 And we as well have still significant leverage to hire TIN price. TIN is the most forgotten metal of the energy transition of electromobility and electronics. So we are just at the right time to develop our assets and bring them into operation until twenty twenty five, twenty twenty six. And even more, why we are in a position to do so due to the reason, one, we are well financed throughout 2023, and we as well have a very experienced management team. Here you see some financial for the last fiscal year. What you can see is that we increased our losses for the last period substantially, so from £1,200,000 in twenty twenty one to three point one million.

4:37 Why is that the case? Because we started our definitive feasibility study. So we paid our money. We used the money that we raised during the course of last year in order to fulfill our promises to run drilling programs in Australia as well as in Germany as well as to execute our DFS studies. We still have adequate cash to be financed throughout of 2023 and deliver exactly what we promised, what means that we expect to finalize the DFS for Taronga until end of twenty twenty three, while that one for Teleheuser will take a little bit longer.

5:25 Like I said, very experienced management team, so very well known in the mining area with a number of persons that had substantial success as well in the past to develop mines and bring them into operations. To name only two of them, Seamus Cornelius, one of the major persons with Dana Cali, and Nick Mader from Australia, which represents, by the way, as well our largest shareholder, Clara Materials, a very well known person in the world of metals. That's really very unique that we have such a experienced management team, and it's as well the reason why we are sure that we can deliver and will deliver exactly according our promises.

6:18 Let's have a look onto the TIN market. The major application for TIN is solder, means every electrical contact you require solder. There is an analysis from the International TIN Association that forecasts that we need in 2023 in 2030, about a 100,000 tons TIN more annually than we have than we use today. To give you an idea about what we are talking today, today, the TIN production is in the range of 380,000 tons, means in 2030, we should achieve 480,000 tons.

7:09 What are the 380,000 tons coming from? Where they are coming from? About 300,000 tons are coming from mining. 80,000 tons are coming from recycling. Means nothing else that the additional 100,000 tons needs to come from the mining industry. Where will it go to?

7:28 So the prediction is that it 2030 electrical mobility will achieve about 30% of cars produced, and 2030 will become electrical cars. That alone represents an additional demand of 50,000 tons, five o thousand tons of tin, followed by the PV industry. Photovoltaic panels stand alone for additional 30,000 tons of tin, and microelectronic will add another 20,000 tons of TIN. Without this additional TIN, we aren't in a position to deliver the promises of energy transition, neither electromobility nor the artificial electronic artificial intelligence where most of the electronic will go to.

8:27 TIN is identified as a critical material in US and Germany and Canada, while the biggest producer today is Indonesia, where, by the way, the Indonesian government is discussing a ban, an export ban of metal tin that will add further burden onto the tin supply chain in the world. Tin stocks at the metal exchanges have recovered, looking back into the beginning of the last year until beginning of this year. Since then, they are declining. They are returning back into a declining way, so there is a good forecast that the market will recover as well.

9:21 We as well found an analysis from Dominic Frisbee that describes with that curve the TIN market, the TIN price development, and he came to the conclusion, that we are in the middle of a very bullish market even more. The tin price dropped substantially from around $50,000 per ton of tin in March, April twenty twenty two down to around $18,000 per ton of tin, which is roughly equal to the long term average price before. But due to the forecasted growth rates in energy transition, in photovoltaics, in electromobility, in electronics, substantial demand is forecasted, and that's the basis where higher TIN price is expected by him.

10:20 Currently, it means today, we are in the range of 23,023 thousand $500 per ton of TIN, which is still good enough for our projects to remain in a robust economical situation. Now I would like to hand over to Tony to guide us through the geology as well as the projects itself. Thanks, Thomas. What you can see on the screen here is a map of all the world's known tin mineralization. In particular, those deposits greater than 50,000 tons of contained tin marked tin red spots. In addition, we've colored in all the OECD countries in green.

11:11 You can see there's a vast disparity between the two. So not much TIN is produced in tier one jurisdictions. Nearly all of the world's TIN is currently produced in either Indonesia, China, The DRC, Bolivia. So, there is, a real need for the, transparency in the market for, TIN to be produced from tier one jurisdictions. And we we're hoping to fill that gap. So first of all, getting on to our Taronga deposit here in Australia. It's being described as having the fifth largest undeveloped TIN reserve globally by the International TIN Association.

12:05 It's situated on land that we have now purchased freehold. So we own rights, absolutely to the to the surface of the land as well as having, tenure for the minerals beneath it. The interesting thing about Taronga is it's a lowish grade deposit, as you can see from the resource estimate there, averaging about point 16% TIN compared with an average grade of point eight to 1% for an underground mine. This is due to the the fact that it's a a sheeted vein system, and the TIN occurs in entirely within a series of veins within a Hornfell's host rock.

12:57 What that means is that, the TIN break the the host the veins tend to be lower strength than the host rock. And when you break the rock, it tends to break on those veins. That liberates the and makes it very easy to extract. The other interesting point about this deposit is it sits on a hill. It has very low strip ratio, and it's open pittable. There are very, very few open pittable tin mines in the world. Most are either alluvial or,

13:34 underground. So putting all that together, while the grade looks low, we think this has got potential to be world class deposit, and, that's being shown by the test work that we're doing at the moment as part of our feasibility study. If if you could look at the bottom of figure on the right, this shows the, the NPV and IRRs and the CapEx for various TIN prices. This was done, previous to us buying the project and prior to, the concept of being able to get nearly all of the TIN out at a cost crush.

14:21 So what that means is our CapEx will be lower, and our OpEx will be significantly lower. So these numbers are guide only, and we expect to be, significantly better than that even with the the increase in, CPI, recently. The other interesting point for with Toronto is we have recently won all the water we need as far as, processing goes under an option by the New South Wales government.

14:58 So I'll move on to the next slide. So the work that's in progress is basically doing a a full environmental impact study and a definitive feasibility study. That has been ongoing there for the last seven or eight months. We've collected all the raw data. We've almost finished the drilling. We started the metallurgical test work, which, by the way, is showing exactly what we predicted, that you can get around about, 75% of the tin in roughly 25% of the rock after crushing it to, a a very coarse size of, 10 millimeters.

15:46 We've also recently you might have seen, in the last few days, an announcement that we've partnered with a group called Bid Energy to look at solar power options. This, we think, has the potential to reduce our power costs to approximately one third of what it would be if we had to either hook into the grid or use diesel power. And we certainly don't want to do the the latter. Moving on to Telehazy. This is a a a very different project located in Germany. It's significantly high grade, as you can see, around about 1% TIN. And it makes, according to the scoping study that was conducted by consultants, in 2021, using the $25,000 TIN price, it has a very significant, MPV

16:46 and a good IRR. And the CapEx is is low and will be low. The resource, as you can see there, is only a small amount in indicated whereas there's significant amount in inferred. The majority of the work that we've been doing on Telehealth of this year has been aimed towards converting those inferred resources into indicated status.

17:18 So as part of that, you you can see on the top of that table there, the teller has a deep drill intercepts. So this has essentially confirmed exactly what we predicted. The the deposit is much, much bigger than the indicated resource area. We did unfortunately have problems with that drilling and that we we terminated the program after only four holes of a 25 hole drilling program, mainly because they weren't reaching the target areas that we wanted. The it is a very difficult target because it's quite small and thin, and it's at 800 to a thousand meters below surface.

18:06 So that presents a whole heap of drilling challenges for us. We're currently, just starting a new drill hole with a different contractor, and we'll see how we go with that. Hopefully, that will, solve all our problems as far as, drilling in the deep levels go. The bottom part of the table shows one of our regional exploration projects called Goddessburg, which is very large, low grade system. What we were doing in there was trying to identify high grade parts of the system. And you can see from those two intercepts that we've certainly done that. And more work is planned to to try and get that into a jock status, that will be a satellite deposit for Telehazard.

18:55 So having given you that quick update, I'll now hand you back to, Thomas. Yeah. Thanks, Tony. And I will proceed, with our values. So I already told you that we achieved our inaugural ESG rating last year, triple b rating given by Dickby, a very well known agency rating agency within the mining and junior mining industry. But we are not only ESG conform already as a mine developer as well. We already developed and stick to our vision to become a conflict free source of TIN throughout the whole value chain by sustainable professional responsible and regulated mining.

19:54 We benefit for sure substantially from our jurisdictions in Australia and in Germany, which are very mature. Nevertheless, on top, we aim and value very high people,

20:13 and in particular, ours and those in the area we are working. And we have a a very high mark and eye on safety. That's our core value. I do not need to talk about the environmental conformity, which is in the making, the environmental impact assessment in Australia and which is already signed off for our German project in Teleheuser, where we got the approval from the authorities

20:46 to go straight forward to the frame mine planning, which represents the construction and operational permitting procedure. How the share price developed?

21:05 Not very good during the course of the last year. So last share price that I have seen was in the range of $6.50. This one was still a little bit higher, so representing a market cap actually today in the range of £20,000,000. What you can see here as well is if you put a TIN price line behind, that shows a very similar way. So that shows how our share price is connected to the TIN price so far. Our biggest shareholders are Clava Resources Australia with nearly 23%, formerly known as AUSTIN, so it has been renamed.

21:53 It's Baker's deal close to 14%, and then already directors with close to 10%. So you can see there is a lot of skin in the game as well from our management and our directors in order to take care that the project will develop or the projects will develop as promised.

22:21 There is a lot of upside potential if we compare our valuation in dollars per ton of resource against our peers where, for instance, Cornish Metals is a comparable kind of an animal because it's as well a tin mine developer, develops in Cornwall and shows by far higher company value pattern of contained resource. I believe, that shows a lot of opportunity, for the future, and to aim to achieve an comparable rating, a comparable enterprise value like

23:38 Hi, Thomas. I think we may have just lost you there momentarily. If I may, what I'll do is I'll just refresh your browser and bring you back through. There we are. Back in the game. Sorry. I was frozen.

24:15 Ladies and gentlemen, please just do bear with me while I reconnect Thomas into the room. Thank you. Hello?

25:28 Can you hear me?

25:32 Yes. We can hear can hear you. I was pushed out of of the conference. Sorry for that. Yeah. I would like to summarize the the presentation. I I guess we have shown you that that we are in a good position that we moved properly forward and as promised to develop our two TIN projects that represent a very simple methodology and as well own already a resource statement.

26:08 The definitive feasibility studies are underway as well at the current prices in the range of 25. We have a robust economy and due to the reason that 25 is expected to be the minimum price required to develop new TIN assets. There is a leverage to higher TIN prices and a substantial improvement of economic possible like you might have seen and extracted from the tables that were represented by Tony.

26:47 Now I would like to conclude the presentation and hand back to Mark, our moderator. Thomas, Tony, thank you very much indeed for your presentation this morning. Ladies and gentlemen, please do continue to submit your questions just by using the Q and A tab that's situated on the top right hand corner of your screen. But just while the team take a few moments to review those questions that were submitted already, I would like to remind you that a recording of this presentation along with a copy of the slides and the published q and a can be accessed via your investor dashboard. Tony, Thomas, we did receive a number of pre submitted questions ahead of today's event. And as you can see there in the q and a tab, we've also received a number of questions throughout your presentation this morning as well. So firstly, thank you to all of those on the call for taking the time to submit their questions. And, Thomas, Tony, if I may just hand back to you to respond to those questions where it's appropriate to do so, and then I'll pick up from you at the end. Thank you.

27:43 Okay. Thanks, Mark. Yeah. So I will start with the already submitted question. Question one, what happens if the TIN price drops below $20,000 per tonne and the project becomes uneconomic?

28:01 Due to the scarcity of TIN, we expect that those drops will become only short term like we have seen, for instance, during the course of the last year. And due to the reason that the minimum necessary price to develop new projects like ours and new projects are necessary to supply all the required tin, we do not expect long term prices below $20,000 per ton of tin.

28:35 What are the plans for funding the CapEx? Capital markets are bad right now, so I don't see how you will be able to fund much through a capital raise. We already have made up our mind how to fund projects besides the equity by a capital raise, which is most probably actually a challenge. But I expect that sooner or later, the predicted boom of the metal market will start if it is tomorrow or maybe in the second half of the year. But even then, it would be early enough to support us, by the capital raise, and there are as well, a number of debt fundings, available through programs, for instance, offered by governments, that came to the conclusion that tin is a critical raw material and required for the energy transition, and as well commercial banks indicated that they potentially would join forces with us in order to get the financing for the and the funding for the CapEx setup. But it's by far too early to discuss really details about it looking onto our schedule that the DFS for Taronga is expected

30:05 to be finalized end of this year and for Teleheuser even a bit later at the beginning, maybe in the first half of twenty twenty four. So there is still enough time to put together the financing and the funding for the CapEx. How do you intend on finding the CapEx required for both projects?

30:31 That's maybe a question related to the DFS. I guess, Tony, that's the right question for you. Sure. Well, as you've already mentioned, Thomas, that, yeah, the the traditional main is means of financing these projects is by a mix of debt and equity. And we'll certainly be looking at those conventional, financing means. The other options we do have are government support. There's a, because we will be one of the few companies producing TIN from stable first world, t one jurisdictions, with no problems with environmental legacies or child labor or conflict metals, we will get we think we will get some support from the local governments.

31:27 The other option is to do a deal with off takers. And certainly, some of the big end users of TIN are potential financiers for us. Yeah. Thanks, Tony. Then one more question in regards to CapEx. What do you estimate the CapEx for projects for both projects is now compared to the 2021 scoping studies? Due to the reason that our DFS as for both projects are work in progress, we and we did not reach a status to get an updated version of the CapEx.

32:16 I would try to there is no new estimate for for the CapEx so far. And what we can tell you is that we have different tendencies. For sure, there is the inflation, everywhere, in particular for for equipment all over the world. So that's a trend that would lead to higher CapEx, but we have as well a number of activities, for instance, the processing tests that we do right now for Taronga, where the aim is to to use at least a very simple and very cheap as well in regards to CapEx, crushing steps for the upgrade of the ore and the up concentration of the ore and to keep the big end very, very slim, which would then lead to a lower CapEx of the compared to the scoping study. So there are different trends, and there is no, exact, answer to that question right now, but we will provide that as soon as we have the DFS for both projects finalized.

33:40 Please comment on FIRST TIN's cash position and financial strengths. Are both DSS funded to completion? At what stage will fresh funds be required? FIRST TIN is still in a very good cash position and financed throughout 2023. That means fully financed for the DFS of of Taronga, while TELLOHAUSO will be finalized at the beginning of twenty twenty four means, you know, finance throughout 2023 with a little bit, of headroom into 2024. But, in order to finalize both permitting procedures during the course of 2024 and DFS for Teleheuser, we require fresh funding and additional equity raise.

34:33 Could you please comment on potential exploration and net present value upside of both projects things? I guess exploration, that's exactly what Tony understands. Yep. So with Telehaser, I think, yeah, the real upside there is is Goddessburg. As I've shown, there's some very, very good intercepts there. That that's the long term upside. As well as the longer term, we do have shorter term upside in in that we we are currently converting inferred resources to indicated. We have large gaps even between inferred resources where we know the geology is the same, and, that there's very good potential for the mineralization to be present in those gaps.

35:26 And also, the the most southerly drill hole we've had to date is one of the best. And so it's really totally open to the, to the South Southeast. So I think there's some really good upside there at, at at Telehauser. Taronga, we've already extended the ore body 400 meters to the Southwest of the previous Newmont resource. We're currently infilling that, and we will add definitely add that to our indicated resource category by the middle of this year. Having said that, it is still opened further to the Southwest.

36:13 And, also, we've recently built walked over the area to the Northeast and seen visible considerate there as well. So so while we will add to the resource this year, it is still open essentially along strike in both directions. That gives us fantastic upside immediately adjacent to the deposit. And we also have many regional targets, two in particular worth mentioning. One is a project called Great Britain or as we've renamed it, TIN Beetle. Because when it breaks on the fracture planes, the the kasidrite crystals look like little black beetles.

36:59 So, that project, there is several intercepts that are very, very similar to Tauranga. And, the other one is a project called Pan Flat, and that has drill intercepts from the late nineteen seventies, early nineteen eighties that are almost identical to the, drill intercepts that we're currently getting at Taronga itself. So we've got both short term and long term, very good exploration prospects of both both properties. Yeah. Thanks, Tony. Next question. What needs to be done to allow enable institutional investment in FIRST TIN? Market cap has been sliding considerably since IPO and sticky hands would be very welcome.

37:50 At least this is exactly what we do is to finalize and deliver our both DFS studies because that is what institutional investors are in particular looking for beside the permitting procedure, to derisk as well as, and to add additional value by doing further exploration and showing what in round value is really there. So we have there a number of, activities, to attract further institutional investors because there are already a number invested in FIRST TIN. And last but not least, last question, markets are volatile and high interest rates make funding of new projects difficult.

38:43 How confident are you in achieving funding in this economic climate? What is, in your opinion, the greatest risk and greatest opportunity for FIRST TIN in the next twelve to eighteen months? How is FIRST TIN trying to mitigate said risk and leverage said opportunity? Like I said earlier already, beside debt funding, there is a number of funding opportunities given by governments and the European Union, for for instance, to support the development of mining projects. So that would be one opportunity. Beside that, we have still a little bit of time to put together our project financing.

39:36 And for sure, we hope that the climate will become better and in particular that the commodity prices will benefit from an improvement of the overall macroeconomic situation. Yeah. Greatest risk is is TIN price for sure. So there we can't do anything against, so there is no mitigation. Greatest opportunity for us is to deliver to deliver clear and good and promising DFS studies and on top the permits so to get really the license to operate for our both mines.

40:25 The second, the later one, we are working on because that's in our hands to deliver DFS as well as permitting. I have no further question that were delivered before we started the interview. So now open to answer further question, and I would like to hand back to Mark, our moderator. Thomas, Tony, thank you very much indeed for addressing those questions. Thomas, Tony, as you can see there in the q and a tab, we have received a further a couple of live questions there. So if you would like to address those, then please feel free, sir. Maybe, while Thomas is getting organized, so I can so the question is when do you anticipate starting the conversations with offtakers?

41:30 I would assume this is a long process. And does this start pre DFS on cases such as this or post? And, look, I I I guess, yeah, the yeah. Mate, do you wanna answer that one, Thomas? Or No. No. No. Go ahead. Yep. So we already have started some discussions with with off takers. But, yeah, that you really can't get down to the nitty gritty until, you have your DFS finished. So I I guess it's a little bit of each is the answer to your question. We we're starting to, yeah, know the right people to talk to, to talk with, and starting to know what they're after and what what they might be able to, do as far as helping as finance goes.

42:24 But, the real, negotiations won't start until we know what we've got and what the, feasibility study is telling us. Mhmm. And I would like to to add, on that. So we had a number of discussions, for sure with, the one or another trader, which is very keen, to sign offtake contracts, already very early. So means, right now, due to the reason that, for instance, maybe you have heard that the the concentrate the tin concentrate supply, in China, is still short. So that's one of the reasons. But we didn't do that so far, because what they offered, in particular in contribution to the financing was, not very attractive so far. And due to the reason that we were financed, it was as well not necessary. And on top of that, maybe you remember that mid of last year, we published as well in a press release that we have signed an MOU with a local smelter close to our German project in Freiberg.

43:38 And what we do right now is we do jointly a scoping study for what it requires and what is the cost and what is the CapEx for a buildup of tin smelting capacity as well so that would be then potentially as well become an off taker. So we are in discussions of that, and we as well have no doubts that the at least signing off take contracts is most probably not the most challenging work we have to do within the next day. So there is enough opportunity for us, and and and that means as well for our investors to at least market our future concentrates.

44:28 So second question, has there been much M and A activity in the TIN space due to market conditions? There has not been much M and A activity in the past. So, at least if you look the TIN miners, they are all of them are, I would say, midsized companies, and the TIN developers like us, rather the smaller ones. So there has not been, much M and A activity in the TIN world. And I would even say there is still no major miner, no blue chip from the mining industry involved in tin mining at all. So they at least left that area after the crush of the International Tin Council or in the years thereafter.

45:26 Yeah. I guess the the the TIN space is very, very small, especially ones outside of China, Indonesia. So there is limited opportunities for for m and a activity. Yeah. Which is which is really a surprise because to give you maybe some estimated figures, if assuming one would build 10,000,000 electrical cars, then there are figures available publicly that an electrical car requires 89 kilograms of copper, which is equal to roughly 3% of the total world's copper production.

46:12 It requires a decent volume of lithium for a battery set. So if the average battery set is in the range of 70 to 77 kilowatt hours, then we talk about 3% of the world's lithium production predicted and forecasted for 2030, but it requires as well 15,000 tons of tin, which is equal to 4% of the total world's tin production. So that's that's really yeah. I wonder why no major player, woke up so far, to put his hand on TIN, while they are still focusing onto metals like copper, like lithium, like nickel.

47:00 So maybe that's in front of us. We don't know. Thomas, Tony, if I may just jump back in there, and thank you very much indeed for addressing all of those questions that came in from investors. And, And, of course, if there are any further questions that do come through, we'll make these available to you immediately after the presentation has ended just for you to review to then add any additional responses, of course, where it's appropriate to do so, and we'll publish all those responses on the investor meet company platform. But, Thomas, just really before really looking to redirect those on the call to provide you their feedback, which I know is particularly important to yourself and the company, if I could please just ask you for a few closing comments to wrap up with, that'd be great. Yeah. Thanks. Thanks, first of all, to all that participated to the call and that contributed and enriched as well the presentation by questions where we are happy to answer to.

47:57 We have shown that we used the equity we raised during the course of last year, in particular for exactly debt promises that we gave last year. We, moved and developed our projects forwards to achieve a DFS for Tela for Taronga end of this year for TelaHorizo beginning of next year. So we added content and we added volume, and I hope we, both of us, so Tony and I, could make you confident and show you that we spend the money for the right topics. So thank you very much, and bye bye. Thomas, Tony, that's great. And thank you once again for updating investors this morning.

48:46 Could I please ask investors not to close this session as you'll now be automatically redirected for the opportunity to provide your feedback in order that the management team can better understand your views and expectations. This will only take a few moments to complete, but I'm sure will be greatly valued by the company. On behalf of the management team of FIRST TIN PLC, we would like to thank you for attending today's presentation. That now concludes today's session. So good morning to you.