Sylvania Platinum (LSE:SLP) — Sylvania Interim Results Presentation

0:01 Good afternoon, ladies and gentlemen, and welcome to the SYLVANIA PLATINUM Interim Results Investor Presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged and could be submitted at any time via the Q and A tab situated just on the right hand corner of your screen. Please simply type in your questions at any time and press send. The company may not be in a position to answer every question that receives during the meeting itself. However, the company will review all questions submitted today and publish responses where it's appropriate to do so. Before we begin, I would like to submit the following poll. And if you'd give that your kind attention, I'm sure the company would be most grateful. I'd now like to hand you over to Jakob Prinsley, CEO. Good afternoon to you, sir. Good afternoon, Jake. And thank you very much for the opportunity to engage with you again and for us having to thank you for our interim results for the period. It's also a pleasure and I think the feedback we get through this platform is very valuable. So myself and Liane Carmunati, our CFO, will be taking you through the

1:02 key aspects of our results in this presentation and hopefully have some time for Q and A afterwards. So let me maybe just jump straight into the overview of the financial year or the half year. I think first of all from a production perspective, were 11 down on the ounces on the corresponding period. But I think it's important to note that we still had a solid production performance and the factors that contributed to the lower production are basically isolated to two instance. So first one being the temporary production suspension at Lesedi, we announced just after our financial year last year and then subsequent water shortages.

1:49 And then secondly, the lower PGM feed grade of open cast raw material we're receiving at our Moyne operation in particular and that affects both PGM feed grades and recovery efficiencies. So those two explain basically the production deterioration and I will cover that a bit more in detail a bit more later. Important one to note is that the PGM feed tonnes are 17% down on the corresponding period is primarily because of the steady tonnage just lost. While all the other operations met or exceeded their production performance for the period. So as I said, overall, quite encouraging that they managed to mitigate a lot of the impact. From the financial perspective, obviously, as we've seen in the last financial year, we are quite heavily impacted by the movements in the PGM price.

2:40 And in this instance, where the PGM basket price deteriorated 7% period on period, the combined to the lower PGM production. Unfortunately, the revenues and profits were quite a bit lower. Nevertheless, it was still a solid performance generating still good cash and profits and that enabled us to be able to still declare a windfall dividend for the period of 2.25p that we would aim to pay in April. That's following on from 4p annual dividend we paid in December and also 3.75p that we've paid in April last year. So the last one on the slide that we will cover in more detail later in the presentation is obviously the group cash cost being up quite a bit and remaining area of focus.

3:31 And because of our large fixed cost portion of our cost and the ounces being down, our cash costs are quite a bit higher and remain the focus area, and we'll deal a bit more of it later in the presentation.

3:51 I think a lot of people are familiar with the location of our operations. This just gives us a brief overview for anybody who is new on the on our company that they are two parts of our presentation. You'll see later in the project when we talk about projects and growth as well. We primarily have six chrome beneficiation and PGM plants, processing plants that are located on the east and western limb of the South African Bushfelt complex respectively. And that's the those are the operations currently generating all our revenue and profits. And then secondly, to the top of the picture there in the middle and off is the two mining right areas that we have or a number of mining right areas. The one is the Grass Valley pro mining project that is we've announced in recent announcements that is a sale that's in progress.

4:44 And then the other two is the Northern Limb and full spread projects, which we deal with later in the presentation.

4:54 Looking at the production profiles, and I've mentioned earlier that we fundamentally this year saw that reduction and the lower production primarily because of the impact of the SIDI and Moinouye. And you can see the yellow and blue bars being smaller for 2022. We are, however, looking at commissioning the Nassidi MF2 later in or during the towards the end of this quarter to ramp up and stabilize during Q4. And we are looking at commissioning the Twerfontein MF2 later in this calendar year. So in the first half of the new financial year and those two projects would help to ramp our profile up again combined with us addressing the water issues and in the city, which I'll be working in the next slide just now. I think also just worth noting on this pro split is we show that these are 4e ounces we're dealing with and you saw that our 4e pro split there on the side.

5:57 But I have also just put a little table in on the slide that compares it to 6E and you can see for instance for this period the 32,400 ounces equates to about 41,860 ounces. And the only reason we're doing that is for you to get an idea. Some of our peers and other companies in the industry announced only 60 ounces and then you can see what the ratio of the two is. So if we look at more detail around the Lesedi problem and we've as I said, we've announced early last year after our financial gain to the problems we've had. We managed to successfully implement a number of mitigating measures that helped us to reinstate the integrity of the dam to the current state where it is not a concern all the parameters are falling within our acceptable design and operating parameters.

6:53 We have, however, from a production point of view, incurred longer downtime than anticipated. And the primary reason for that is when we started remining and recommissioning feed to the operation. At the end of September last year, We've had significant water shortages and also because we're depositing on a temporary emergency tailings deposition facility, our return water rates the recovery rates were lower than normal. And therefore, it exacerbated the water problem and we had significant production downtimes at that operation. However, we have subsequently installed an additional water supply through new boreholes that was installed at And also, we have just commenced commissioning of the new tailings facility at Lesedi. It's been in construction during the last year. And you can see the bottom right picture there. It's a state of the art tailings facility with suitable storage, return water dam and storm water dam facilities that would be able to manage the water a lot more efficiently going forward. So overall, we believe that we'll see the SADI coming back to more sustainable production and from Q4, obviously, this current quarter, January and February still partially impacted and taking into account in our forecast for the year.

8:21 When we look at the other two areas of focus at the moment, the lower ROM grades and as I explained in previous announcements,

8:33 since our host mine scaled down some of the underground operations in early twenty twenty, we have seen quite a reduction in PGM feed grade to our Moinwe operation in particular with PGMs being 30% to 40% lower. And various sampling campaigns and investigations have been performed during the period to try and address that with those mines. Obviously, the chrome miners don't do PGM grade control at all, the primary chrome miners because it's not the business and we from SYLVANIA's point of view and our relationship with those mines, employed external geologists and mining engineers, specifically to focus on the PGM grade occurrence on the various sources so that we can work with those one to try and improve the blending ratio to our operation. And we anticipate an improvement in the feed grades to come.

9:24 The last one at the bottom of the slide is water constraints and operations and it ties into what I've just discussed on the CD, but water generally in the areas of the program. And we've also received on the pre submitted questions for investor meet quite a few questions relating to water. So I think it's worth maybe just looking at what we're doing. There are various initiatives we have implemented since 2019, and that was really the first year where we had significant downtime between Moino and Lesedi. We've had significant additional drill bottles drilled to recover water around our own properties. We've also, as a very innovative plan that employed a company called Waterhunters to scavenge and reduce seepage water from around the perimeter of the tailings dams that added significantly to our water supply and helped us to balance the water better.

10:17 And then finally, as I said, looking at better return water facilities around our designs in the new tailings facilities. We also continue to engage with our host mines, with neighboring mines, with water specialists in the area to not only look on our own properties, but also conducting water studies underground, water surveys in our surrounds. And there's a couple of projects that potentially improves the long term situation of water. So I think if it wasn't for the tailings dam issues at the SETI, the impact would not have been so pronounced, but it is still a focus area for us in terms of long term security. From opportunity perspective, obviously, we're quite happy that we are able to commission our the SETI plant soon, the MF2, which is the secondary milling flotation. And as you would remember, these secondary milling flotation plants is outflow from the very successful rollout of our Project ECHO or where we have rolled out MF2 plants to Mill Cell, Dordenbos and Muenau respectively and which have been running very successfully for a number of years now.

11:32 The city is the next one to follow and then Truffontein is also in execution to be done later in the year. And as I said earlier, those plants will contribute during the next periods. Also is progress on the additional third party tailings material and that is specifically looking at higher grade available tailings for third parties that we can bring into our existing infrastructure on the one hand and also then at new opportunities. On the other hand, obviously, the existing ones we have is some smaller feed sources to the tune of 2,000 to 3,000 ounces a year we can add. That's associated with some of our Eastern operations. But then we also have various sampling campaigns where we continue to engage with the parties to bring and secure more material online.

12:22 Fine chrome recovery is again is a project we've defined in terms of unlocking potential in otherwise sterilized resources where the PGM grade is too low in some of our old dumps. So instead of walking away from those dumps because the PGM grade is low, there's still significant chrome in them. And there's a there's a mutually beneficial business case for us in those mines to recover that chrome. And once you recover the significant amount of fine chrome, you also upgrade the PGMs to a stage where it is worth taking it another time free operation, so therefore extending life of mine. And we continue to focus on those projects. Lennox, in particular, is an example where this would work very well. And then just finally, we managed to maintain our strong cash reserves and we continuously balance our existing capital projects to stay in business and internal expansion versus the need for future projects and looking at the turning value for shareholders in the different instruments and also then it gives us advantage of having cash available in the event of opportunistic M and A.

13:33 So I'm going to hand over to Lou Anne now just to take us through the financials, and then we'll deal a bit more with some of the projects at the end and the market, and I'll do the details for us afterwards. So thank you, Leanne. Stay clear. Thanks, Joaquin, and afternoon all. Running briefly through the financial information for the six months to 12/31/2021, Net revenue for the period was $69,000,000 and includes four e revenue and byproducts as well as base metals and the sales adjustment for the period. I'll go into the revenue in little more detail in the next slide.

14:18 Cost of sales includes both direct and indirect costs of production plus noncash items such as your depreciation, your share based payments and rehab provision movements. We've split out the mineral royalty tax on the face of the statements given the increase in royalty attracting ounces resulting in a much higher cost, so so that it is separately disclosed. And then other expenses are mainly G and A in South Africa, Mauritius, Bermuda and The U. K. And then a portion of that is also realized for its adjustments on revenue. Lastly, on this slide is the income tax expense, which includes income tax that's payable on profits in South Africa at 28%, deferred tax movements, dividend withholding tax, which is declared on dividends declared by the South African operating entity upwards to the parent entity.

15:19 And this all brings us to a net profit of 24,000,000 for the period. Looking at revenue, the net revenue is down 19% from the comparative prior period. The lower basket price accounted for a decrease of $600,000 and the lower ounce production, a decrease of $9,300,000 The percentage revenue contribution for each of the six e metals is shown in the pie chart in the bottom right of this slide. Platinum contributed 23% of revenue, which equates to about $15,000,000 platinum 20 palladium, 15%, which is about $10,000,000 and rhodium at 56% of our revenue at $39,000,000 Ruthenium and iridium make up the balance of the 6E revenue of $5,000,000 The sales adjustment for the period is calculated on the ounces that were delivered in the last three months of the 2021 financial year and recorded at the last price received in

16:20 June, but only invoiced in July, August and September. So the pullback in the rhodium price in September had a negative impact on our revenue for the six months. The SDA operating cash cost per ounce increased 32% to $815 per ounce compared to H1 twenty twenty one. A portion of this increase is due to the strengthening of the average rand dollar by 7% half year and half year. So if you look at the cost in rand terms, our cash cost increased 23% with the main contributors being the 15% increase in electricity, mining costs that were higher due to the subsidy paid to the host mine.

17:08 This, as we said at our year end results presentation, was on a trial basis and has subsequently stopped so that cost will be reduced. We had higher consumable costs, which were incurred as a result of more raw material at the Lanex plant. Annual payroll increases were effective in July 2021, and then we had slightly higher maintenance costs as a result of course material feed being processed to some of the plants. Converting at an average exchange rate of $15.29 to the dollar, we are forecasting our full year cost at around $790 per ounce. The 2023 and 2024 cost per ounce is an illustrative guide based on our forecast ounces as well as the current exchange rate.

17:59 Then the table on the right just gives a breakdown of the five largest direct costs of operations for the six months with employee costs accounting for 32% of total direct operating costs and then followed by electricity.

18:17 The group EBITDA, as with revenue and cost per ounce, the EBITDA was impacted by the lower ounce production and lower prices for the period as well as slightly higher costs. The full year EBITDA is estimated at just below $100,000,000 and has been adjusted for the revision in production for the financial year. Again, the 2023 and 2024 EBITDA estimates are an illustrative guide based on the current exchange rates and spot prices in February 2022 and the higher forecast ounces produced following the commissioning of the SIDI MF2 and Trepentine next year. Our cash flows remained strong despite the production challenges.

19:05 For the reporting period, operating profit before capital was CAD36.4 million, dollars working capital increased $6,700,000 net interest income of $700,000 and we paid out taxes of $12,000,000 Investing activities comprised capital spend of 6,100,000 on operations, capital projects and SIB and then $1,300,000 on exploration. The company also spent $2,400,000 on share buybacks and paid out $14,600,000 in December for the annual dividends for financial year 2021. Looking forward to the second half of the financial year, cash flows will be impacted by the ounce production and basket price.

19:51 The higher basket price in February will have a favorable effect on cash flow for ounces produced in November, December. Higher capital spend and outflows for possible growth projects, income tax and mineral royalty tax payable in June will affect the cash flow for the next six months as well. And then lastly, the payment of the one fold dividend in April and any other potential cash capital returns to shareholders over the next six months. There hasn't been too much change to the capital forecast for the full year compared to the presentation in September. We incurred little additional capital on the temporary tailings facility at Lesedi and much of this will be reallocated to the new facility.

20:43 The forecast remains at around $22,000,000 for the full year and $16,000,000 for 2023, and this includes the MX2 for Lesedi and Truffontein and then the three tailings dams, which are in SIV. On exploration capital for 2022 is the drilling program that commenced last year As we're still awaiting the final results on this program, which are due July this year, we haven't planned any further exploration capital and that will be dealt with in the new financial year. Then looking at our ESG, in our 2021 annual reports, we published our pathway to ESG report confirming our commitment to ESG and sustainable mining based on the UN Sustainable Development Goals.

21:38 At each reporting period, we aim to provide updates and on our progress whilst aligning our ESG risks, opportunities and exposure areas to the company's values as well as the ICMM guiding principles.

21:55 The very nature of our business reduces the impact of mineral waste impact that mineral waste dumps have on the environment. The reworking of the dumps and re depositing on the same footprint for more enhanced facilities reduces the environmental impact of these dumps and also reduces the potential seepage or spillage as we continuously monitor and upgrade these facilities. In addition to this, the company also makes financial provision for final rehabilitation of these facilities. And we've just commissioned a trial project to re vegetate the dumps with suitable plants and seeds and ultimately create a natural habitat to attract insects and small animals. The desktop study for this was completed during the reporting period and a site at one of our plants has already been allocated to start the trial.

22:48 The main focus of the company with regard to our carbon transition currently is energy optimization and investigating renewable energy. SYLVANIA's current emission calculations are based on Scope one and two emission sources from ESCOM diesel generation and diesel used and are below acceptable thresholds. Management intends to focus on reducing energy intensity through optimization of processes, the possible reduction and replacement of Scope one and two energy sources with greener alternatives and ultimately the recovery of emissions. This is a long term goal, but small projects are already in place and are being implemented such as power factor correction installed at 83% of the SCL plants, newer lighting installations utilizing lower low energy LED

23:43 and then studies have been initiated at two plants to assess the suitability of possible PV plants to supplement daily power usage. Under the social banner, the company grew its local community employment by 27%. We've funded or are funding a number of learnerships or work based learning programs. There was a small increase in women in mining during the reporting period, and the company aims to increase this even further going forward. We continued our community projects with focus on schools, feeding schemes, business development of community businesses and awareness programs, including World AIDS Day, sixteen days of activism for no violence against women and children and Arbor Day to name a few.

24:36 The company also launched an employee wellness program post period end. We identified the need for this program after noticing the impact of COVID-nineteen on the mental well-being of people in general. The program goes beyond COVID though and provides unlimited telephone counseling covering work, personal, emotional trauma, dealing with illness and dependency, and also provides financial planning advice, face to face counselling if necessary and legal advice. In respect of safety, although the lost time injury frequency rate reduced in comparison to the prior financial year, The company did have one LTI where an employee of a contractor on-site injured their finger.

25:22 The plants do run regular safety campaigns and they are well supported by employees and contractors.

25:32 Under governance, the company is in the process of formalizing its ESG reporting toolkit. In addition, the company is continuously updating and improving its existing policies to align these with stakeholder expectations and to ensure legal compliance. We had no Section 54 or Section 55 stoppages or instructions from the Department of Mineral Resources. And in terms of our economic contributions in South Africa, the company paid $377,000,000 to suppliers in South Africa and both OpEx and CapEx. ZAR 155,000,000 was paid to employees and in taxes and contributions on behalf of employees and ZAR329 million was paid in income tax, VAT, mineral royalty tax and dividend withholding tax.

26:24 Work on our ESG is ESG reporting is ongoing, and we're looking forward to publishing a full ESG report in the future. That's just a few photos of our community and bond project.

26:46 Thank you very much, Luanne. And I think let us have a quick look at the PGM basket prices and the market and also where to from here. I think very briefly just a recap the pro split we've had earlier in the presentation as well. But it puts in perspective when you look at the price trend at the bottom where we had the big increase, especially rhodium, that purple line in the bottom of the graph, increased about mid last year and then the sharp decline thereafter. But fortunately, we have started seeing an uptick again since early this year. And I'll explain that a bit more in terms of the fundamentals on the next slide.

27:33 But just you can see our rhodium is 56% of our revenue for the past year. Our impact on the price of rhodium because of our Pearl has a good split. So when it was all going well and rhodium is up, it's all positive and when rhodium is declining, it does have a negative result to results. So when we look at the market and where we think the price will go, I think it's important to understand in the metals that we deal with and that forms a significant part of our basket. What drives that, I think palladium and rhodium, you very much going together with the auto catalysts sales rates, a significant portion 8391% respectively on the demand.

28:19 And that was heavily impacted during the past year with a slowdown in internal combustion vehicle sales that was in turn impacted by the global chip shortage. But we have seen as the sales are starting to improve and also forecasted to improve significantly during the year, we have seen recovery starting in these metals and with analysts forecasting these metals to remain in deficit. For the short to medium term, we are quite positive that we should still experience robust process on palladium, rhodium and some. Yes. We're fully aware that battery liquid vehicles are referred to the internal combustion engine catalyst, but, you know, you have to also look structurally at the capacity of producers to produce the necessary battery metals, your nickel, cobalt, lithium, etcetera to build the batteries and also as a result of the supply and demand of the increasing prices.

29:25 And we've seen very sharp increases already. And those are factors that might slow down the battery electric vehicle rollout. Nevertheless, as I said, for the short to medium term, we're quite confident in the palladium and rhodium market. The platinum on the other side of being in surplus at the price was a bit more under pressure in recent years. However, with platinum's role in both as an industrial and industrial chemical applications and also the opportunity where some suppliers are looking at substitution from palladium to platinum in some auto cats, that is the demand for platinum we're looking for going forward is forecasted to increase.

30:11 And I think, know, analysts vary slightly in the forecast, but between five and seven years, we expect to play the platinum price to increase more. Platinum plays quite a big role in the hydrogen economy in the sense of hydrogen catalysts, both in industrial catalysts and also in fuel cell vehicles. So we'll keep our eye on that. And I think just when you look at some of the prices we've had from a few institutions, I think this first one, the platinum and Standard Bank, Corporate Banks forecast in terms of platinum, especially the long term increasing is in line with that expected amount increase. I know Liberum and Nedbank have a more stable outlook. And then palladium and rhodium, you can see both have a declining profile, but still significantly higher than historic levels.

31:04 And while gold is quite flat and that is a minor portion, there's no 1% of our overall basket. So in general, I think we were the metals at these moment. We don't anticipate the prices necessarily to go back to where we've seen them in the first half of last calendar year, but we do believe they will be remain significantly stronger than we've seen in recent years. So if we look at the strategy in our outlook going forward, we obviously remain committed to return significant value to our shareholders And we do that in the sense of creating positive generating positive cash and returning value to the shareholders both by means of dividends and we've done both the annual and windfall dividends and also regular share buybacks.

31:58 And also by not going back to the market to ask for money to fund our growth projects, we haven't had the need to raise any capital in the market since 2009 and all our growth up to now has been funded from internal cash resources completely. So we want to maintain and continue with annual stable, sustainable annual dividend and a progressive dividend for shareholders that we continue to generate cash there. And then as we have done with this particular windfall, we have higher than anticipated metal prices compared to consensus at least for a period, we would look at sharing again additional money with our shareholders.

32:43 And then obviously, since 2015, we've had almost 50,000,049 million shares that we bought back, of which we canceled nearly 30,000,000 shares retainable at the shareholders. So that's a philosophy that we'll continue to do. Obviously, in order to maintain flows back to our shareholders, we have to ensure that we continue generating profits and that we have a sustainable business going forward. And we do that in three ways. Firstly, we said normal R and D and price optimization initiatives where we focus on our existing operations, making them more efficient and still insert modifications, employing new technology so that we can get more out of them.

33:30 And I think this time we do that is where we've since about 2014 with the same number of operations, we initially increased our ounce profile from about 45,000 to over 70,000 ounces in recent years. And to that effect, the two MF2 projects, the Lesedi and Puerfontein projects that I've discussed already earlier in the presentation is looking to roll out in the short term. Also the fine chrome opportunity I've spoken about is something that can follow in the short term approach and then also feeding dump source into our existing operations. If you look more longer term and in terms of expanding capacity and creating a longer life of mine, we've been over the years engaging with a number of third parties in the industry.

34:15 To look at adding resources to our program. And we're confident that both from the eastern and western limits, respectively, that we're able to add those resources in the timeframe, suggest that that could add between 10,020 ounces a year each if we progress them. And we've currently busy with investigations on them and depending on specific commercial terms, we will decide on how we roll out and what form it will take in terms of both funding it from capital. We do have I've given an indicative figure of, say, between 20,000,000 and $25,000,000 is what we expect on each of these projects to bring them to commissioning. And with our current cash generation forecast and cash reserves, we should be able to fund our projects and maintain a stable dividend. When we look longer term and probably deviating slightly from the current dump and current tailings business is the longer term exploration projects.

35:18 Those are two mineral projects for which we own the mining rights, approved mining rights that have been granted. And that is projects we own up in the Northern Limb. And we've had them for a number of years. Obviously, I explained that the previous periods that our regional business model was a lot more bullish and we were prepared to take a lot more risk by building our own smelters and refining. So the intention to do it in the regional scope some twelve years ago, but that's highly capital intensive and higher risk. So, we have in recent years and then over the last two years decided we're going to rather look at focusing on the high grade areas of these resources. We're the resource that can so that we can produce a higher grade concentrate that's saleable to existing smelters and refineries without us to having incurred the cost and risk of only internal hydrometallurgical and pyrometallurgical infrastructure And that's what we're looking on these projects.

36:17 Obviously, from a timeline perspective, you would remember, I've announced earlier when we launched the specialist studies on full spread and the northern and full spread study outcomes we expecting during the next six months, where we should be able to restate the resource and reserve to acceptable limits that we are able to make a decision on how we want to progress with the project. The northern LIMITED entailed some additional drilling and those drilling work has been concluded at the end of December. And we're busy with logging analysis and sampling at the moment on those things. And then we will also, hopefully by year end, have geological results to share. And then a couple of months later, we will be able to have the mining models run on that as well.

37:12 These projects, I think it's important to stress that looking at the capital requirement to them and also the size is we as a board will make a decision once we have the feedback on the studies and the results to say, does that fit into our current strategy of being profitable, low risk and sustainable projects for the current business to do in in house, our own resources or do we say, listen, you need to partner maybe of one of the bigger players in the market to to progress them or potentially sell them or to roll them out in a different vehicle. So those decisions have not been been made yet and it's premature to to decide that now before we have all the final information.

37:58 But certainly, what we do believe is that it is quality resources. It is shallow resources. As I said, they're open pitable. They can be open cost mining, so they near surface. And the philosophy change we made is that we can produce grades that is saleable to the current market. So this does hopefully give you a flavor of that there is significant potential life, there is growth and I'm confident that with our proven track record over the years of growing the business to where we are that we will be able to continue to grow it. Finally, just maybe inclusion as the outlook, as I mentioned earlier, production is key for us to ensure that we are able to continue to fund our growth aspirations, also that we are able to fund shareholder returns.

38:52 We believe the PGM market is robust enough for us to support us in that regard. From a strategic point of view, we're focusing on the things we can control and that's production, operating cost and our project rollout. And more importantly, in the last couple of years, recent years, there's been a strong focus on specific strategic alliances and partnerships with third parties and also where we have identified external growth opportunities and we continue to build on those and then to have sustainable shareholder value and both in the form of dividend and share buybacks. And you can see in the capital allocation at the bottom that just our capital committed is specifically for the strategic projects, new tailings storage facilities like the SIB and exploration assets.

39:39 You will see there is no capital in capital slide which we uncovered. There is no additional capital for exploration projects currently in our estimates forward looking estimates. And it's purely because we haven't added any additional ounces for it in our current estimates. So those things will be determined once we bring those projects to finalization. And then finally, it always remains a decision and a key consideration for us to be able to fund dividends and share buybacks that we have adequate cash available. So yes, that brings us to the end of the presentation. And I think I Jakob, Lewand, thank you very much for your presentation this afternoon. Ladies and gentlemen, please do continue to submit your questions using the Q and A tab that's just situated on the right hand corner of your screen. But just while the company take a few moments to review those questions already submitted, I'd like to remind you the recording of this presentation along with a copy of the slides and the published q and a can be accessed via your investor dashboard.

40:38 Jako, Luan, we received a number of pre submitted questions from investors and I wanted to start off the Q and A session with these. The first one, I believe you touched on in the presentation, but maybe if you could provide a bit more color. Will the management team be looking at share buybacks moving forward? Yes. Thank you, Jake. No, as I said, is a key consideration for us. And when we look at the current best cash position and capital requirements, we have agreed to make a sort of amount available for share buybacks in the near future. We'll always approach them on opportunistic basis where we believe we can add value to shareholders. So that's something we will continue and the Board is committed to doing. And I think also positive in that regard is taking the balance of shares currently in treasury that have to we need for employee share schemes and in relation going forward. We don't need to buy any shares back for that. If any shares we would buy back in the future would be canceled and therefore add value.

41:46 Thank you. The second question that we received pre submitted was, are any of the planned workovers or developments on unexploited assets expected to make any significant improvement to ounces produced or are these works just expected to keep us near current output? Yeah. Look, I think that's important one and I, you know, without us having to have the exact time frame that project pipeline, the idea is that it's not just sustaining current level. You know, we you have inflationary cross pressures over the time and if you're going to stay at the same production levels or declining production levels, you will erode your margins going forward. So the key is always to say, listen, how do we grow the business more? And I think we've always had a growth plan. And in this last two years, it was unfortunately significantly hampered firstly by COVID and then by the host mine cutback.

42:39 Otherwise, we would have seen the growth on our profiles. But we're also looking at a more significant growth going forward and then projects that we're looking to add on the profile. So I think when we shared our profile earlier, we were looking at between 60,070 ounces for about seven to ten years. We're after as most of our primary dump sources are deteriorating, you rely only more on current devices and dump it probably would have tapered down to say 40,000 to 50,000 ounces, adding additional plants that tune of 15,000 or 10,000 to 20,000 ounces on Eastern West and respectively, you you suddenly move your margin to stay over, say about 100,000 ounces and then even longer term, you can add the exploration projects if we decide to continue them even on top of that. So certainly, the idea is to grow the profile rather than just maintaining the profile and replacing existing production.

43:35 So I hope that answered the question. That's great. The final pre submitted question that we have here reads as follows. The global automakers are sing signaling a massive ramp up in production this year. Hopefully, basket price will be robust as a result. How can SYLVANIA take advantage of this? Could output be increased temporarily to build stocks and position to sell into high into high basket price? Look. So that is unfortunately, the flexibility is not that great that we suddenly we can change our production plans to suit the market. The pro splits, in other words, the ratio of the black and palladium rhodium in our ores are quite consistent and constant. So there's unfortunately not opportunity for us to do that a lot.

44:22 What we can do and what we continuously do is to evaluate. We often get approached by third parties to say, you know, they have higher grade material maybe from operations, but they have their own treatment facilities and can you treat it? And if we have an operation, for instance, where we currently treating low grade dump material and you are able to substitute that feed with a higher grade material and then the incremental value we generate makes sense for both parties. Certainly, those are things we continuously evaluate. From our own mining perspectives, we can look at our own resources and say, okay, we can optimize grades. But unfortunately, there's not huge flexibility in that regard, but it remains a consideration in how we approach our feed sources and the business plans.

45:08 That's great. Thank you so much for that. If I may, could I please ask you to open up that Q and A tab that's just on the right hand corner of your screen? As you can see, we received a number of questions throughout today's presentation. And thank you once again to all investors for submitting those questions. If I could please ask you to read out the questions and give a response where it's appropriate to do so and I'll pick up from you at the end. Thank you. Okay. So, I'm looking at one of the things, but I think maybe while I was talking, don't know if it's been answered. So there was a question from David. Say you are using excess cash to buy back shares, are these shares being canceled or held in treasury and buybacks tend to be a two way having a positive impact on the share price. I think I have indicated that we have sufficient shares in treasury to fulfill the needs of our share schemes.

46:01 So obviously, we would clearly looking at canceling them. And I know there's been a big debate of does the canceling add value or not. We certainly have a number of our institutions and shareholders that said they prefer the buyback over the dividends. There's others that say that prefer the dividend and we always try to maintain a balance. And that's also why we say, it's also just to have an opportunistic approach to it and see when in the spells where we're dealing with a lower share price that we do the buybacks then. And sometimes, shareholders perceive it as not having an impact, but you could have well had the share price declining further if the buybacks not happened. So again, I hope that answered the question from David. That was David F on the screen. I see there's a next question from David Zitt.

46:50 I'm not sure if the same David or another one. And he asked, can you can probably along the similar lines, can you comment on the poor valuation of the share price and why this is what I believe is that earnings of only four. Now, and I think there's many shareholders that raise their frustration about the valuation of the share price in recent years. And I mean, that's something we also try to work hard on. Unfortunately, we can't control the share price, know, it's based on how the market perceives the value. But what I do think is, you know, once you are able to add more tangible resources, I mean, we believe that the growth is there. But for analysts and investors to make proper long term forecast.

47:39 It always helped to have proper reserves and resources available. So there's a timeline. There's a clear indication of how much you have and for how long it will last. And I'm hoping that given this next year, we will be able to bring a lot more of that to the table. As we update our resources on our exploration projects, we can do it. The third parties we engage in with have approved resource and reserve statements of that work. And I think that will help shareholders to have a clearer line of sight in terms of what our business is based on. It's always been difficult with our current arrangement with those mines where you operate in a commercial confidential commercial agreement, and it's a private listed company, so they don't disclose any of their operations.

48:24 And I believe that, that might be a big impact on why we're not seeing the valuation as strong as it could be and understandably so. But I do think the situation that should improve going forward. I think there's the next question I see is from Michael D. He says, are you continuing to experience cost pressures in the business? Look, obviously, I mentioned first the one for us is the fact that we have a large fixed cost portion. So obviously, when the answers are down, we are under pressure. There's our unit costs are higher. From the external points, yes, we've had recently a 15% increase in electricity.

49:12 We have, you know, our global national utility have asked or applied for a 20% increase rate for the next financial year and that's kind of just still have to be approved by the authorities. I think lot of the local analysts believe that it probably wouldn't be approved, but in any case, the electricity has been higher than standard deflation in the last few years. So electricity almost remain a cost pressure. We're fortunate enough that from a labor perspective, our labor portion is lower than typical conventional underground mines. And we've been since we started the company, have been able to always conclude wage negotiations on a reasonable industry related values.

50:04 And so labor have also been fine. I think on the projects, we see a bit on post COVID on supply of steel and electronics and those kind of things a bit more of a increase in prices. But from those normal running operations, highest cost pressure is probably electricity demand. Jake, if I look at my dropdown screen, that's probably the Yes. Yes. I was just going to say thank you for addressing all those questions that you can from investors today. And of course, ladies and gentlemen, the company will have the opportunity to provide answers to any further questions where they believe it is appropriate to do so, and they'll be available on the investment company platform. Jakob, perhaps before redirecting investors to provide you their feedback, which I know is particularly important to the company, can I please ask you for a few closing comments to wrap up with? Thank you.

50:58 Yes. Thank you, Jake. I think as I said to us always, it's a great opportunity for us to engage with investors. And I said it before, this platform since COVID have provided us the opportunity to reach many more than we could do with an additional roadshow going for London. So thank you very much then. I think, you know, looking over all the results for the past quarter, although it's a robust set of results, there is definitely room for us for improvement and I hope that we have given the shareholders assurance that we know exactly where the areas are and that we are putting adequate and sufficient plans in place to address them. And also, I hope that shareholders can see that these are quite a solid, sustainable and attractive profile ahead of us. And I'm sure we will be able to return value to our shareholders and significant value for many years to come. So thanks for the confidence, thanks for the support and thanks for this opportunity.

52:04 Jako, Luan, thank you very much for updating investors this afternoon. 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 the management team can better understand your views and expectations? This will only take a few moments to complete, but I'm sure it'll 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.