Sylvania Platinum (LSE:SLP) — Investor Presentation

0:01 Good afternoon, and welcome to the SYLVANIA PLATINUM LIMITED Investor Presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged and can be submitted at any time by the Q and A tab situated in the right hand corner of your screen. Just simply type in your questions and press send. The company may not be in a position to answer every question received in the meeting itself. However, the company will review all questions submitted today and publish responses where it is appropriate to do so. Before we begin, I'd like to submit the following poll. And I'd now like to hand you over to Jakub Princely, CEO. Good afternoon, sir.

0:33 Thank you. Good afternoon, Alessandro, and thanks for the introduction. And welcome, everybody, to our half year results presentation for the half year ended 12/31/2022. Myself and Joanne Carbonati, our CFO, will thank you for the presentation, highlight some of the key results and highlights for the year. And then at the end, hopefully, we have enough time to answer some questions. So maybe just to start off, and for those of you who might not be familiar with the company, let's just highlight what SYLVANIA is about. SYLVANIA PLATINUM has two distinct parts to its business. Firstly, it has our attractive low cost cash generating SYLVANIA dump operations that consist of six chrome and PGM beneficiation plants located in the Eastern And Western LIMITED BUSHELD Complex, respectively.

1:31 And these are the current PGM producing units of our business that's responsible for our current cash flow and profits, and we will deal with the financials throughout the presentation that they're simulating from these operations. And secondly, the company also owns a number of lucrative exploration assets on the northern limb of the Bushveld Complex, that is north of that map that you see, which offers significant growth potential for the company, and I will touch a bit more in the presentation as we go along. I think just briefly looking at some of the key highlights for the year. We are very proud of the half year performance of 38,471 ounces produced. This is the second highest half year performance in the history of the company and the highest since COVID. So certainly, we're very excited about it.

2:26 And it was enabled by a significantly improved PGM feed tonne performance as our historical water and tailings related issues at Lesedi have been resolved and that operation is now running steady. And also, our safe operation that we've been to, we had zero loss time increase across our operations for the period. This strong production performance combined with still a robust PGM basket price, although it declined 15% on the period to about $2,513 an ounce. We have managed to deliver strong financial performance as well. We ended the year on about $124,000,000 in cash, which enabled us and the Board to take a decision to declare an interim dividend of $0.03 at this time with our results.

3:23 Maybe while I mentioned the dividend is one of the other highlights for us during this period, we pleased to announce that the Board has updated our dividend policy to provide some clearer guidelines of what we anticipate to pay out on a routine basis. And this dividend is a part of the first part of the annual dividend that Lou Anne will cover in a bit more detail later in the presentation. If we look at some of the more detailed parameters, mentioned the higher PGM feed terms also enabling that higher. That's just a significant improvement in PGM recovery efficiency. And there, we've seen a significant contribution from our Lennox operation where have reagent optimization work.

4:08 We've had a step change in recovery efficiency, especially on some of the oxidized sources that they do treat as well as at Moinway with the wrong quality and grade have improved, we have seen recovery improvements and also at our Quiventan operation for optimization of the flotation plants and plant stability. On the finance side, then you can see that we have had very attractive and significant growth in our net revenue as well as net profit figures. Net revenue up about 16% on the comparative period and net profit approximately 34%. And besides the fact that it was driven by the higher ounces, I mentioned earlier that we had a slight reduction in basket price. But then also the sales adjustment we received was a slight positive adjustment in this period compared to a negative adjustment in the previous period. And that's why these increases in revenue and profit are proportionally higher than just the production increase.

5:06 Touching on the ESG, which is covered in quite a bit more detail later in the presentation, I think it's just worth saying that we're very proud of the progress we've made on our ESG during the last, say, two years and especially this past half year. Our ESG strategy has always been aligned with our values that have been deeply entrenched in our operations and in the company for all the years we've been operating. And we've been able to publish our first stand alone ESG report with our full year financials last year. So our ESG principle is certainly well aligned with the sustainable development goals of the United Nations as well as the ICMN, and we will touch a bit more detail later on.

5:52 So if I first look at bit more detail on the operations, and as I mentioned, focusing on the dump operations of ours, I mentioned strong performance. You can see it here in the bars for 2023. And you would have also noticed that the release of our second quarter results, we've increased the annual guidance for the year. We believe that we should be able to achieve 70,000 to 72,000 ounces at least. And that's it despite the current Eskom load shedding constraints, which we don't believe would have an adverse impact on this guidance at the moment. And then also taking into account the recovery improvements we expect from the optimization of the NF2 circuit that Griffin plant was just commissioned during December.

6:38 And then looking forward towards 2024 and 2025 financial years, you will see contributions from the Lennox NF2 that's currently under construction then coming into play as well. I think also encouraging and worth noting is that we have seen a very good performance in terms of the wrong fee credit quality at our Moyniwa operation that you would remember historically have been a challenge for us after COVID and initial slowdown at those mines. We've, through our collaborative efforts with the hose mines, we've managed to have a significant improvement in our own grades, which we believe is now at a sustainable level going forward. Just on a bit more detail on the individual operations and probably more for background and reference if somebody want to look at it.

7:27 I've actually mentioned quite a few of these points already. This maybe focus on one or two of the points that was not mentioned yet, and the one being Lesedi, where we are exposed currently to some downtime from the government's commercial situation. And maybe we're just briefly expanding on that. Our operations in general, so five of our six plants have not had impact from the latest load shedding, and that's because of the power utilities load curtailment plans in Africa that on integrated suppliers mean that they instead of cutting certain hours in a day, they ask the bigger industrial users to cut a certain percentage of supply. And your industrial integrated producers like SRAMANCORE similar to Anglo Platinum, Ipala, Sibanye who have smelters and refineries as well as mines, they typically choose to do that load curtailment at the smelter facilities. Therefore, the mines where most of our plants are situated are not impacted at this stage, but our SYLVANIA operation is situated at a smelter site and therefore have been affected. And there, we are busy as a mitigating measure to, with a project to, install backup power generation, unit that can, enable us to run while they are of no curtailment at the operation.

8:54 The other point probably not mentioned earlier is just again highlighting that we are busy with the execution of two tailings dam facilities, one at our Amunway operation, which will be the first to be constructed and the second at our Dorambos operation that is in the design and authorization phase. While these are important, we've been building tailings dams throughout the history of the organization on a continuous basis as we re mine certain tailings resources, we build new facilities. But this do have a bearing on the capital we guide on, and Lou Anne will touch in a bit more detail on that later in the presentation. So just again reminding you in terms of the pro split and looking at how that basket price then has an influence.

9:42 Firstly, just highlighting that top graph illustrating our rhodium exposure in our pro is about 11.4% for this past half year. That's quite consistent throughout the periods, palladium about 23% and platinum 65%. And you can see at the bottom graph where the historical metal prices and especially rhodium overshadowing that bottom graph with the rhodium price has increased, how that had an impact on our full year basket price. Quite interesting on the top, the rand, South African rand basket price, you can see it stayed fairly flat while you saw a decline in the last six months of rhodium and palladium. And one of the reasons there is that these metal prices have declined in dollar terms to a large extent because of the strengthening of the dollar and not necessarily because of the strength of the metal. I think in terms of euro, rands and some other currencies, the metal price actually stayed quite consistent.

10:40 So just worth noting. So when we look forward, which is probably more important is the conflict between Russia and Ukraine is still something that bear on the industry. Certainly, know historically, the COVID-nineteen restrictions and lockdowns in China have had an impact. And that now being eased, we have a more positive outlook. And if we look at the some of our key institutions, just to give you some illustrative idea of what the price is forecasted to do, we've included Nedbank CIB that covers most of the PGM producers in South Africa, Standard Bank Securities, which is our Standard Bank as being our corporate bank in South Africa as well as Liberum Wealth here in The UK that is our nomad and broker.

11:33 And it gives you an indication, maybe the one worth pointing out that a lot of people ask why is the platinum from Standard Bank increasing significantly, and that is largely due to the view on the supply and demand side. I think on the demand side, they have quite aggressive outlook on the role platinum will play in the hydrogen economy, hydrogen fuel cells and going forward. And at the rate, the uptake will happen. And on the supply side, they are more concerned than the other institutions in terms of the impacts that power in

12:04 South Africa might have on supply. South Africa being the largest producer of platinum and rhodium in the world. And you can see that the platinum and palladium outlook are more are higher than the other institutions in that regard. If we turn our eye now slightly to the exploration opportunities and now looking at our long history at Black and Decker and Dunbar operations, a lot of people ask us, okay, so why are you focusing on exploration projects? I think firstly, I've mentioned before, we do own the mineral rights, approved mineral rights on a number of these projects. And while the company continues to focus on the delivery of value from our existing operations and focusing and continuing on cash generation, it is important to optimize the value from these exploration assets that remain one of the important pillars of SYLVANIA's growth strategy and as a key value driver for shareholders.

13:05 So with this in mind, during 2021 financial year, we initiated some targeted studies that specifically falls right in our Far North Inland projects where it's the two regions of these projects to determine how best to optimize these projects to so that we can declare the optimum value for our shareholders. So let me first focus on what we've been doing on Fullsprite. And you might have noticed, we have published these initial optimization study results during October last year. On fourth straight, in particular, we published a mineral resource estimate that focused first on the North Body and then also continue to a scoping study to give us some idea of the possibility of economic extraction on the probability there often.

13:56 And the reason we focused only on the North body is at that time, the South bodies, the drilling density and geological data was not at the choke compliance status to include in the mineral resource estimate, although it represent about 40% of the estimated resource on the area. And also another important thing, the initial study excluded the rhodium contribution. We couldn't include rhodium again because historically when these projects were done, rhodium was at a much lower price. Rhodium was excluded from the assays. So we had to include significant assays and do a lot more work to get rhodium at the jaw compliant level. So both of those, the self body and rhodium is being addressed at the moment. And we're hoping that by the end of this financial year, when we report our results in August, September, that we can include present updated scoping study for full split that would include those two upside that we use upside potential.

14:53 On Aurora project, which is a bit more to the north, Aurora is typically well, the project is located about 30 kilometers north of annual platinum's flagship Mogalakwena operation and then just south of platinum group metals, the, Waterberg, PGM project. So what we have on on, Aurora is, a 16 kilometer strike length of near surface material and, this material that sub crops at five to 10 meters below surface are certainly very attractive from an open cost minability point of view. And I think probably more significantly is the discovery of the T zone mineralization of T reef that we've discovered on this property. So historically, always interpreted this area from the historic drill cause as a flat reef deposit.

15:49 And it wasn't until 2017 that some academics pointed out following the discovery of the T Reef at Waterberg project, you know, I think between 2012 and '14 that this could potentially also be T Reef. Why is that significant? Whereas your black reef is probably wider at a lower grade, this T reef is anywhere between say two and eleven meters thick at a significantly higher grade. And you can see from the portion at La Pucella where we already confirmed the mineral resource estimate that we could get to about 2.6 gram per tonne. And this is significant because contrary to the initial strategy we had of having our own downstream refinery and smelting facilities, which are highly capital intensive, we can now most probably produce a saleable concentrate.

16:40 What do we focus on this next year is to increase the confidence in the rest of the strike length so that we can grow the mineral resource estimate for this project. And therefore then we can make decision on what and how to proceed with this project going forward. The last one is maybe just ACRA on the far north and very similar to the Aurora project. We need to just confirm the mineral resource estimate. It is slightly different because it contains also a deep level, a lot deeper underground resource to the north that borders our neighbor at platinum group metals you can see in the yellow block. But again, we we have to crew to work, say, in the next two to six months in terms of the clearing and maiden resource estimate on that area, and then we can decide how best to progress on it. So having discussed all that, I think this is just a summary of the the results that I've just discussed, you know, and including the jaw compliant resource for for Sprait North and Laposella only and summarizing the actions. But I'll leave you for reference later. And then I'm going to hand over to Anne to have a look at the financial results and take us through the highlights of that.

17:52 Thanks, Jakob. Turning back to our historical information. We're quite pleased with our results to December 31, and I'd just like to highlight a couple of points on the income statement. Our net revenue for the period is up 16% on the corresponding fourth year.

18:08 Mineral royalty tax increased by $750,000 as a result of higher ounces and a higher percentage of royalty attracting ounces that were produced as well as the higher revenues. Finance income comprises of interest received on surplus funds that we invest in South Africa as well as interest charged on the two loans that we have outstanding, with the ties of JV and the loan to Ford Africa Mining. Income tax line includes, income tax on taxable profits of the South African operations as well as due to for tax movements, dividend withholding tax on dividends declared from the South African operations up to the parent entity as well as a small amount of CGT on the sale of the Grass Valley assets.

19:03 As I mentioned on the previous slide, the group net revenue increased 16% on the corresponding year period. The main contributor to the increase in the revenue is the increase in ounces delivered with a small negative effect of the drop in the metal prices. As you can see from the pie chart at the bottom of the slide, rhodium still remains a significant contributor to our total revenue reported for the period at 52% of our

19:37 The SCO 4E cash cost for the half year was $6.00 $2 per ounce and for the group, it was $742 per ounce. Although this is a decrease of 1816% on the corresponding period due to the higher production, the total direct cost increased 12% for the reporting period. This is mainly due to the increase in the agent costs that we saw in the latter part of the last financial year and then go through into the new financial year. The increase in number of employees as we commissioned the SYLVANIA and TROPITED MF2s. We had some higher mining costs at the Western operations as they moved more tons to the plants and the increase in electricity costs.

20:25 For the full year, we're forecasting approximately $654 per ounce for e, and that's at an exchange rate of $17.63 to the U. S. Dollar and is based on the revised ounce target of 70 to 72,000 ounces. In industry terms, SYLVANIA still operates in the lowest quartile of the cost curve with an all in cost, including our exploration capital of just over $1,000 per ounce.

20:59 The group reported $45,000,000 EBITDA for the period ended December 31. The full year forecast is currently forecast at between 76,000,000 and $80,000,000, and again, based on the February 2023 metal prices and exchange rates as well as the revised production.

21:25 Our cash flow for the period, we ended the reporting period at with a cash balance of a $123,000,000. This is after paying $7,700,000 in taxes as well as the $25,000,000 we paid out in dividends in December 22. The group spent $6,200,000 on capital for the six months, which is split between the STO operations or the STO at $5,300,000 and $900,000 on the exploration projects. And then the board has declared, as Joaquin mentioned, the 3p dividend on ordinary shares in terms of the new dividend policy, which I'll expand on a level in the next couple of slides.

22:14 Our capital, as I've just mentioned, the $6,200,000 that was spent for the reporting period, the forecast for the full financial year has been revised down from, $22,000,000 to $18,000,000. This is as a result of the delay in the implementation of our backup power, due to the availability of equipment.

22:38 It's not significantly delayed, but it will be some of the capital will be pushed into the next financial year as well as rescheduling of some of tailings dams due to delays in permitting of the host mines. So for the full year, we're looking at spending about $5,000,000 on exploration, $8,500,000 on capital expansion and optimization projects, and these include the Lanex m f two, the two ten m f two optimization, and the backup power, and then about $4,000,000 on SIB, including our tailings dams. You'll see the forecast for 2025 onwards are only SIB and a small amount for exploration, and that's purely because we haven't committed to large capital spend for those years.

23:29 And looking at how the company returns value to shareholders, we're very pleased with that the board has revised the dividend policy and that the company now has a more clearer model friendly policy. The new policy states that the board will distribute a minimum of 40% of the company's adjusted free cash flow for a financial year. We'll split this into an interim dividend at half year of about one third of the forecast adjusted cash flow and then a final dividend of approximately two thirds. Adjusted cash flow is calculated as the cash inflow from operations less capital for that period and then adjusted for any debt commitments and covenants and committed future growth or expansion capital.

24:19 In addition to the annual events, the company has bought back 56,000,000 shares since 2015 and canceled 18,000,000 shares. Buybacks will still be done on an ad hoc basis or as opportunity arises. Moving on to our ESG. This slide just gives a snapshot of some of the ESG progress for the reporting period and the seventeen year end sustainable development goals that that we applied to our ESG policy. On the environmental side, we've received our carbon footprint for report for the half year, and we also developed, water balances for each plant.

25:07 We are in the process of implementing additional water flow meters to improve accuracy, of water flow monitoring at each of the plants.

25:17 We've concluded assessments at four of our six operations to assess and confirm compliance with the global industry standard on tailings management. And then most notably, under the environmental section, four to six months, and and we're quite excited about the results of our first phase of the re vegetation trials. And we took a mixture of six indigenous grass seeds and planted them on different control areas, and it was found that the seed beds treated with mulch were most successful. We also noted an increase in biodiversity in these areas through the increase of insects and other life species. And now we're starting phase two where we'll be introducing further insects and earthworms as well as, other indigenous plant species and then using process water to, lower soil alkalinity.

26:15 Ultimately, this process we expected that this method of rehabilitation will significantly reduce the rehabilitation costs and reduce the number of years of aftercare as the areas will become self sustainable in approximately three years.

26:34 Under the social banner, we're particularly proud of both our percentage female complement and our safety record. Our female representation increased to 22% from 20% at early June against an industry average of 14% that was published by the council in 2022. On the safety side, as Yaki mentioned in the snapshot, the group recorded no LTIs for the six months to December 31 with remaining over ten years LTI free. And it's also noteworthy that the company is fatality free since inception. Under governance, we've had we have an updated legal compliance audit underway, and the company has also contributed approximately a million $1,000,000,000 rand to the South African economy over the six months, and details of this can be found in the results announcements if you would like to have a look at more.

27:40 Back to you, Luca. Thank you very much, Dan, for taking us through performance. And now that we've looked at the past financial performance, maybe let us just focus briefly on what you can expect from us in the next period and going forward. So I think, first of all, we've it's important and I think we will agree that in recognizing the cash generation efficiency of our current businesses that we should continue to focus on the profitability and safe performance of our operations so that we can continue to generate cash both in order to generate stable returns to our shareholders, but also to enable us to fund our growth projects and aspirations.

28:28 So we certainly continue to do that. We further, in terms of our license to operate, the ESG has become a lot more significant in recent periods for especially our investors and the institutions we're dealing with, but also in terms of our license in their communities we operate with our employees and also our stakeholders, it is important that we maintain those principles. And also, and more practically focusing on items like, the permitting and authorizations rather telling stamps having that, time easily in place. And so looking forward then in terms of growth, maintaining and increasing our PGM house profile, they are the two areas. We're just looking at that. The one is

29:13 looking internally. First of all, at the current dump operations, progressing R and D initiatives and similar to what we've done in the past to grow the ounce profile from the existing operations and existing resources, improving recovery efficiencies, reducing the current in the feed to to our PGM feed. Those items will continue with. We then also in terms of the owned mineral resources, as I explained earlier, are looking at our best to optimize value. And then external external to what we already own, external to the host mines where we operate is to look at, similar, host mines or third party producers that have tailings resources or, run of mine material where we can replicate our current business model from current, solid and dump operations to add more value. And we have some projects that's quite far advanced in the negotiations on the Eastern And Western Limb, respectively, of the Wushelt complex that we hope we can make good progress in the coming period.

30:18 To give you some idea of time frames and then scope, I'm just updating what I have shared before is from the existing STO, we mentioned prefrontend that has just been commissioned and being in the optimization phase now, Lanex, that we are looking at commissioning early in the new financial year towards the end of this financial year. And then we continue to pursue higher grade third party material that we told in our current operations as an opportunity arise. Forward looking on that, I mentioned on the R and D focus and then longer term is steady focus to see how can we unlock further potential on dumps we may be view as stabilized or redundant at the moment that could well still yield production in the future.

31:07 And the new opportunities, we've quite far advanced, as I mentioned, with technical, commercial, due diligences and even some process on certain projects. And on the Western LIM, on a 100% attributable basis, you look at about 10,000 to 15,000 ounces a year. You should be able to add that the Western Lum opportunity could come as soon as eighteen to, say, twenty four months into production, where the Eastern Luminous is slightly more onerous in the sense of authorizations, environmental authorizations and stuff that we are still needing to explore. So that might take a little bit longer. And then longer term, we continue to explore and investigate, you know, opportunities for both very old historical down sources, but also consulting with current producers.

32:01 I always say to people, when SYLVANIA started initially about fifteen years ago, the estimated production life was about five years. And now fifteen years later, we say that from what we already know and have, we believe we can be beyond ten years profitable life. And we therefore believe that we'll be able to continue and add on top of that profile. And then finally, in terms of exploration assets, I mentioned in quite a bit of detail what we are busy with there. And I think what we can look forward to, it's just the key dates, course, product updated scoping study by the end of this financial year and then only probably the next year, the updated mineral resource estimate on Aurora and then also the ACRA for the case of this year. But I think important to note there and some people ask us what is the capital requirement or need for this. And at this stage, we have not applied or forecasting to apply any capital for the development of this project. Our aim currently is to unlock the value by upgrading the resource estimates, and that would enable us in, say, about eighteen months period to make a decision to say how best to unlock value yet. Is that a disposal? Is it a partnership with somebody? Is that development in house?

33:12 Those decisions we'll only make once we have adequate data available. So that's where we're progressing to. I have, as an indication only, indicated that, you know, the size of operation you can expect the typical ounce production. While full split, I say, yeah, that was based on the North Body only about 70,000 to 100,000 ounces a year. Just competitive to what we already produced, it gives you an idea what we can produce in the Northern Limb. We also said about 80,000 to 120,000 ounces. That was when we initially just looked at La Purcella, which only about 12 of the overall resource. So obviously significant upside potential there. But we will update the market as we progress in terms of these exploration opportunities. So finally, just final outlook and my closing slide then is to say, sure, investors, we have a proven track record on delivering to shareholder returns, and we will continue to do so. We'll continue to focus on our cash generation projects.

34:11 We will we have disciplined capital allocation policies in place and also have proven over the last few years, we have mentioned five consecutive years of dividend payment that we are committed to returning value to shareholders and also our new dividend policy is testament to our commitment. I've mentioned just in the previous slide, various opportunities for growth and we believe that we will be able to continue doing that. The PGM market, although there are many external factors that impact continuously play a role, we do believe that the market is robust. We are cautiously optimistic about pricing. We know I mentioned some of the global sociopolitical factors that play a role. But in general, our outlooks, we confirm that and remain, as I said, cautiously optimistic. And then just finally, the production ounce guidance, we've stated what our estimate for this year is. If there's no adverse or worst impact from Eskom, for instance, and our grades hold through, there might well be more upside to this guidance. And then longer term, you can see the 2425 onwards, the increase in production profile.

35:20 So that, I think, concludes just the presentation from our side. So, Alessandro, I will end up to you and we look at some of the questions. Perfect. Jakob, hello Anne. Thank you very much for your presentation. Ladies and gentlemen, please do continue to submit your questions just by using the Q and A tab, which is situated on the top right hand corner of your screen. But while the company take a few minutes to review those questions submitted today, I'd like to remind you that recording of this presentation along with a copy of the slides and the published q and a can be accessed

35:47 via your investor dashboard. Yaka, Luana, you can see we received a number of questions throughout today's presentation, But we I might just start with the first pre submitted question here, which reads as follows. Why does SYLVANIA only report results against the previous period? Wouldn't like for like analysis with the same period last year also be helpful? Thank you, Saurabh. I think that one and and then maybe there's a it's a slight bit of confusion. So in terms of this half year performance, we have reported half year one of '22 to the corresponding half year '21. So that is like for like periods. The quarterly results, we do, report, on consecutive periods. So so they are slightly different because, I mean, it because it's a quarterly period, the guys don't want to look for for periods back for the for the results and we do that. So we do as I said, quarterly results that we produce is back to back, but these half year results are in fact comparing with a comparative period. So it is a like to like comparison.

36:50 Perfect. Thanks very much. Turning to the next question. How do you see the supply demand balance for platinum evolving over the next seven years? And what are your forward plans in relation to this background? Look, I've touched on this slightly on our market outlook. And I mean, I think there's two things. When you look at platinum supply and demand, particularly, I think is what the question asked. Platinum is saw in recent years quite a decline as automotive manufacturers move from diesel predominantly, the amount of diesel manufacturing reduced with platinum is used in the auto catalyst to more petrol vehicles where palladium certainly had a higher market share. From supply and demand fundamentals, I think short term wise, there's always the element of when do people or manufacturers start to substitute and switch between platinum and palladium.

37:47 And I think there's not a significant portion of that forecast at the moment. But what probably is more driving at the moment is the supply risk to platinum and palladium. I think most of the primary and significant producers in their recent results announcement since December, people turned out this past week, have indicated that there was significant impact by the load shedding on production. So certainly, the supply pressures of all costs, and I mentioned earlier that Standard Bank view that as one of the key risks and the factors in them having the higher platinum price outlook. So I think in the short to midterm supply fears, for South Africa, who is a major big platinum producer in the world, is driving the price. And then longer term, platinum will play a more significant role in the hydrogen economy, hydrogen fuel cells going forward, whereas when you look at that substitution of internal combustion engines going forward with either battery vehicles or platinum fuel cells, platinum is forecasted to play a more important role. That's why you see typically platinum's medium to longer term price outlook is increasing.

39:03 What can we do about it? What's our plans? Unfortunately, with the pro split we have in our baskets, know, from our dump operations, we're very fortunate that platinum is actually the biggest of our plan, about 65% platinum now. So you know, the platinum price increase there, the dump operations would benefit significantly. On the exploration assets, the platinum pro is actually slightly lower. There's more palladium reach, But also what the exploration projects offer in future is that they are significantly higher in nickel and copper metals. So those two, again, in the battery and the greener economy, playing a major role for billings as well. So I mean, we can't change the content of our minerals, but I think we have a quite well diversified basket within the PGMs that if one of the PGMs have a higher price outlook, we should benefit from this to store bodes well for a profitable sustainable business going forward.

40:14 Perfect. Thank you. A question here on dividend, which asks if you can confirm whether you'll be paying two dividends, one in April, one in December 2023 as per 2022. Yes. I and I think to Anne actually did answer that in everything, but maybe just to clarify again, we and I think there was a question as well about windfall dividend. But we the new policy now says that we are looking at to pay two dividends for the dividend in two tranches for the year. So roughly about onethree of our estimated dividend for the year during the half year and then final payment equivalent to about three thirds at the end of the financial year. So that is how the current policy is written. By taking this policy on board And as we mentioned, it's a minimum of 40%, and it could well be more. We're looking to move away from a special or a windfall dividend like we have declared in the past two years where there was a windfall dividend.

41:13 I think during our extensive engagement with institutions, analysts and shareholders during the past year or two about our dividend policy, there's certainly a lot of people indicated that it's very difficult to forecast the windfall dividend, for instance, in their modeling because of all once off dividends, and they would prefer us having a more stable, consistent annual dividend policy. And that is what we've tried to set out to. And as I said, it will be two payments as the question has been asked, roughly one third of the perceived dividend for the quarter estimated in at the half year results and then a two third final dividend at the end of the year. Perfect. Jafka, thank you very much. Given the possible decline in the use of platinum in the motor industry, is the board planning for such eventuality?

42:00 Further, what future vision has the board for the company? Look. And I I'm I think it's it ties somewhat in with the previous question and answers. I said, you know, we have different components in our basket. You know, you, I I think they are there are two two deals and asking my my personal view on it as well. The the big factor with our current PGM basket in the market, is how fast the the, uptake of, electric or fuel cell vehicles would be compared to, the combustion vehicles. And also, you know, once you say so you have first of all, it's moving away from combustion, then it's the ratio of fuel cell, which will still boost will still be very good for the platinum market because we will assume platinum, but versus battery elements that use less premium. So it depends on what your view is about how fast that would be able to roll out.

43:02 Certainly, from a mining perspective and most of the mining conferences and some presentation I've attended is, there's certainly a big risk that mines globally will not be able to meet the demand for the battery metals and the green energy metals going forward. And therefore, that rollout could well be slower than currently anticipated. We are not, unfortunately, also not in a position to tell you now exactly when it it will happen and what rate. I do personally think that it's gonna be slower than than most people anticipate at the moment. You know, I certainly think outside the first world countries, the more developed world, certainly, there's a lot of infrastructure that have to be in place to convert and move away from internal combustion engines.

43:53 But I mean, that view certainly plays a massive role on how you view the market going forward. Perfect. Thank you for that. A lot of investors seem to be calling for another special dividend. Would it be better to hold cash for further projects, efficiencies or expansion? Personally, I think the current dividend strikes the right balance. Yes. Thank you. And I think we I mentioned just in one of the previous answers that we would try to move away now from special or the windfall dividend. So yes, we would try to maintain our dividend policy. And as I said, the current dividend policy allows us to distribute more if we have periods of higher metal prices, higher production, then we are able to distribute more than the minimum 40%, but at least investors know we get the minimum of 40% available.

44:44 Looking at future projects, the short to medium term projects, the items we, at the moment, say, is in the pipeline that we know about, we're sure that the cash holding cash reserves we currently have are able to cater for those. And then going forward into the future, we certainly would evaluate the need for the cash. And that decision will impact on us to say, it a 40% or 50% or 60% cash flow free cash flow distribution is will be determined on what we need to provide for going forward. And I think that's why Diane mentioned very importantly, the adjusted free cash flow. We she said, it's net of debt covenants, Bruce. So we don't have any debt at the moment. So that's not the issue.

45:31 And the projects that we would then if we have to provide for them would be projects that we would announce and shareholders would be aware of and what the benefit would be. So, yeah, we will continuously see that we strike the right balance of providing for growth and providing consistent return to our shareholders. Perfect. Jakob, thank you very much. That concludes the pre submitted questions. But as you can see, we received a number of questions throughout today's presentation. And if I could just ask you to read out the questions and give responses to where it's appropriate to do so, I'll pick up from you at the end. Okay. Yeah. So I see we have about within fifteen minutes. I think one of the first questions I see on the side here is, what somebody is saying, regarding the share buyback program.

46:18 While the company does not buy more shares in the market is not at an attractive price. I think we try to balance share buybacks with dividends, and we historically try to do that. We have mentioned to you that, I think, over 56,000,000 shares bought back over the last number of years. It's been a significant thing. I think also through our engagement with our shareholders, there's always the view for that more stable return. And in terms of dividends, I've seen some shareholders mention and say, we'll have to return a dividend and move aside in which company to buy the shares, be it Pennsylvania or somebody else. So that's always the one argument. There's some of our shareholders who say they prefer the dividend and you can have a clear policy. We do, however, from time to time, the Board will assess if we believe there's a potential weakness in the market or if we do require shares for management or employee share buyback programs share programs, then we might buy back in the market when the price allow. But we currently don't have any formal share buyback programs announced.

47:23 And as I said, we will the Board continue to view that opportunistically going forward. So I hope that answered that question. I'm looking at another question that says, are you holding very large amount of cash? Why and what are your plans to use it? So we do take several factors into account when we look at our cash holding. We look at providing certainly for our typically about a four month working capital provision that in the eventuality, like we've seen just in recent years during the COVID period, we are able to cover our commitments and salaries and for the business. So we keep working capital.

48:09 We're making provision for our taxes and capital allocations and also for potential growth opportunities. So that's how we determine our cash holding. And we will consistently review our cash holding together with the free cash flow generation going forward to decide on the specific dividend payment going forward. As I said, we've guided the minimum amount and these overall requirements for cash would play a role in declaring higher than the minimum dividend going forward. Another question says or just ask, are there any chrome is there any chrome associated with the Northern Limb projects? So the Northern Limb projects does not contain any chrome at all.

48:56 So it's below detectable limits on most of those projects. So it's pure PGM projects. Two, well, one benefit from it. So probably on the downside is there's no chrome revenue from any chrome produced. But on the positive side, one of the key impacts with your smelters being able to treat your concentrate from these projects is what the chrome content is. On our current operations, chrome is viewed very negative in that concentrate for smelters, whereas in these, projects, they are no chrome. So that should help us in terms of commercial marketing of the concentrates. Talking about cramp, however, on the further dump operations we are looking at, know, third party opportunities, as I've mentioned, you know, they are obviously it's it's chrome tailings and, and run of mine material.

49:53 And, they were increasingly, finding that the, partners or third parties we're engaging with want more exposure to PGMs following the success we've had certainly over a number of years at some of our peers in the market. And in those instances, we might take up slightly more exposure to the chrome market, which actually at the moment is on near record high price or very attractive pricing at the moment in the chrome market. So there will be a combination of balancing the PGM versus chrome exposures on new projects around the dump side, but on the exploration side to the northern one, no problem involved. There was another question that also asked about the cash. I think I have answered that one.

50:40 Then another question about share buybacks, and I think I've also answered that one. Then there's a question that says that the company produces 72,000 ounces for the year. Current spot PGM pricing, the net profit for the year is likely to be around $50,000,000 versus market consensus of $60,000,000 Should the company update the market on this. Now as I mentioned at the start of the presentation and also I think we mentioned in our statements, we always, for these kind of presentations, use a spot price out. So what is the current spot price we're seeing and it is at the time when typically, say, the last two weeks average before we do the presentation. And then we do indicate consensus and the institution sensitivities to see how it would be. So that is an indicative outlook, and we always warn to say, please, it is indicative view only.

51:37 We obviously, as we get more accurate information, so twice a year when we do the updates to these investor presentations, we update those the market based on the spot price and give the sensitivities in terms of the market consensus and the outlook. But on guidance, certainly, on a quarterly basis, we assess where we are going with our ounce production. And as I said, we, after our second quarter, increased the guidance. We will assess at the end of our third quarter, again, where our production guidance is going and then we'll certainly update the market on a quarterly basis on our easy amounts forecast for the year. So yes, we do update the market, as I said quarterly on the answers and then twice a year based on the market outlook on the pricing.

52:36 There is a question that says, there any data suggested what the demand for PGMs may be required from power cells that you are aware of? Now certainly, there are different types of cells. When you look at the fuel cells, what I most of the analysts would say to you, it can be up to double the loading for a fuel cell compared to internal combustion catalyst. I'm not qualified to tell you exactly the numbers. There are some research, you know, of of analysts and suppliers that that that do calculate some of it. But this is it is quite variable between the different technologies used, the different suppliers who who forecast that. I think the general view is from a platinum point of view, certainly, it will use significantly more platinum, in a fuel cell than in a in a in order to get, but, I I unfortunately can't quantify the number for you.

53:34 Then there's a question relating to power. He says, when do you expect the current power outage just to stop and the power needs to be returned to normal operation? So, again, you know, we can follow on what are being communicated to us by the Eskom utility and by government in South Africa. I've, I certainly, at the current forecast, the estimate is and the guidance from utility government and also some analysts are that the current situation would most probably continue until about June, July this year. There are three things that at the moment is impacting significantly on the current power supply. The one is the most recently commissioned and both power stations with SYLVANIA and Bidupi is not running at design capacity. So there's a lot of work to try and improve that and a lot of work going in to get the power output as well.

54:31 Then secondly, because of the aging infrastructure at our existing power stations, there's a lot of downtime and unplanned maintenance. So they are doing a lot of work to to try and resolve that. And then thirdly, and that I think would be the big swing for the industry at the moment is that one of the, modules or or big part of the nuclear power plant in South Africa. And Quebec is down for a planned upgrade, and they that's necessary in order to extend the life of that power station by a number of of years. So that is forecasted to come back online later in the year. And that's why the guidance we currently get on the power station is that it would be going to about the middle of this year. Saying that, I think I've mentioned earlier that you know, barring further significant deterioration in the situation, we don't anticipate any major or more significant downtimes.

55:28 Where we do experience downtimes at the moment, we are progressing with backup power solutions so that we can mitigate that. And that's also I hope that answer that question. There was another question just on the basket price, where it is heading. I think the previous answers maybe addressed that. And there's another question. How can you please comment on the continual underperformance of the share price with an extremely low PE ratio? And could you comment on your performance on the future performance of the rhodium? Can you comment on your performance on the future performance of the rhodium? It's a I get to the trust in the last part of the question, but maybe let's focus on the first part of it. And what people often look at the fundamentals. We mentioned, it's a low cost, low risk business, cash generative, five consecutive annual dividends and growing dividend for the company, growth prospects, why massive cash balance or almost a third of the market cap in cash reserves, certainly, everybody expect the share price to trade higher. We expect the share price to trade higher and we hope for it to trade higher.

56:44 So unfortunately, we're not in control of it and the markets will do what the markets will do. And I I sometimes look at at things we think historically. Certainly, if you look a few years back, I believe that shareholders might have thought and myself in business, there's not enough clarity in the growth potential for the company and then the future production is one thing. Think, what I think probably is also playing quite a big role is the sentiment around South Africa and the power. You just asked us about the the power at the moment. That, I think, plays a role, and we see some of our peers are also trying to know what we think they should be trading. And then, probably one other important point is that, us being, at the host mines, that's a private company and not posting formal resource statements or estimates for that to illustrate the life of the project.

57:39 People probably feel uncomfortable to predict the life without it being published. However, you know, and I've mentioned before that we our host mind relationship at SYLVANIA PLATINUM has about SYLVANIA PLATINUM so Africa, the biggest resources in the world for crime. So certainly, we have a very positive. So yes, I can't explain it for you. I hope it improved and certainly we have. I think conscious of the time. I am unfortunately don't have time for further questions, Alessandra. So Yeah. Yeah. Yeah. No problem at all. Thank you very much for that. I think you've addressed all those questions you can from investors. And of course, the company will review all questions submitted today and will publish those responses on the investor meet company platform.

58:24 But just before redirecting investors provide you with their feedback, which I is particularly important to yourself and the company. Jakob, could I just ask you for a few closing comments? Thank you, Alessandro. Yes, I think as we've pointed out, and I think we illustrate for these financials, and that SYLVANIA is a very attractive business, cash generative. And we have a strong record of both in terms of performance as well as shareholder returns. So certainly, through a combination of dividends and buybacks, we would focus on building on that going forward. I also believe that by leveraging on our experience and expertise over the years and by continuing to do what we do and have been doing, we will continue to be able to add value to our employees, our communities and stakeholders in Africa as well as our shareholders in terms of not only continuing to pay dividends, but also to ensure that we maintain and grow the current business so that we have a sustainable business for many years to come and we'll be able to continue adding value. So thank you very much for the opportunity. Thanks for all the support, and we appreciate it. Thank you. Yeah. K. Lo Anne, thanks once again for updating investors today.

59:41 Could I please ask investors not to close the session as you'll now be automatically redirected 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 SYLVANIA PLATINUM LIMITED, we'd like to thank you for attending today's presentation, and good afternoon to you all. Thank you.