Andrada Mining (LSE:ATM) — Interim Results

0:01 Good morning, and welcome to the ANDRADA MINING LIMITED Interim Results Investor Presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged, and they can be submitted at any time using the Q and A tab situated on the right hand corner of your screen. Simply type in your questions and press send. Before we begin, I would like to submit the following poll. I would now like to hand you over to the management team, Anthony Hinton. Good morning.

0:28 Good morning, everyone, and thank you for joining us. I'm Anthony Fillion, the Chief Executive Officer of ANDRADA MINING. And to present with me today, I'm joined by our CFO, Hittend Uka. Today, we are delighted to present to you our unaudited interim results for the six months ended August 31. We want to focus on three things: our financial turnaround, the next phase of growth at Wiese and the opportunity across our wider portfolio. Following the presentation, we will take your questions. Please take a moment to note the disclaimer. For those new to the company, ANDRADA is a profitable, cash generating tin producer with a portfolio of critical minerals, mining and exploration assets in Namibia.

1:16 We have funded expansion programs in place at WIIS targeting annual contained tin production of between fifteen hundred and nineteen hundred tonnes per annum. In addition, our active exploration and development projects,

1:30 Lithium Ridge and Branberg West, are being advanced through staged partner funding from our key strategic partners, SQM and BWCAM. Across the portfolio, ANDRADA has exposure to five critical minerals: tin, tantalum, lithium, tungsten and copper. ANDRADA is at an important turning point. We delivered GBP 2,500,000 in profit after tax and GBP 4,900,000 in operating cash generation in the first half of the year. We have a profitable operating platform, a defined growth plan and additional portfolio upside potential. I'll now hand over to Hetten to take you through the financial performance and operating economics.

2:17 Thank you, Anthony. These results mark a clear change in ANDRADA's financial performance compared to the prior periods. Revenue is up 80% to $20,600,000 This is driven by higher 10 production and stronger pricing. Gross profit more than quadrupled to $8,300,000 with gross margins above 40%. Administrative expenses increased as a result of incentive awards for financial year 2025 and 2026, which were approved this year and have accounted for a portion of that increase. Out of the $13,500,000 CAD1.3 million of that cost related to IFRS share based payment charges. We achieved an adjusted EBITDA of CAD4.5 million, which excludes a gain made on the swap instrument.

3:06 Profit after taxes was $2,500,000 compared to a $3,000,000 loss in the prior period. A key takeaway is that OIS is now showing real operational leverage and it can actually support the group at these price levels.

3:23 Moving on to the Oui's operational performance and unit costs. The stronger financial results were supported by better operating metrics. Contained in production is up 13% to five seventy six tons. Feed grades and throughputs both improved. Recoveries reached 73%. These combined with higher tin prices significantly lifted our gross profit margins. C1 cost remained stable with marginal increase in costs, which were offset by higher volumes. Our all in sustaining costs increased to $32,000 a ton compared to $25,000 in the prior period. This increase was mainly driven by higher stripping, higher fuel prices and the introduction of the Tysarco marketing agreement.

4:08 The all in sustaining costs, including the royalty increased as a result of volume, price and the royalty rate. This cost is expected to reduce significantly once the capital expansion program is commissioned. This will have an immediate impact to the current royalty rate alongside other cost dilutions.

4:28 On the cash flow front, the group has generated 4,900,000 of operating cash, which will be reinvested in the capital projects and debt servicing. The bridge provides a snapshot of inflows from the equity placing and the bank finance recently concluded. This is offset by repayments that were made. Both these financing streams contributed to the $7,700,000 spent on the capital program. Whilst we carry the cash cost of the capital expansion now, the cash flow benefits of this will only come through once those projects are commissioned. So there is a timing gap for that benefit. We also continue to manage our debt and funding commitments carefully. A key benefit to having the financially strong partnerships on Frantog West and Litin Ridge means that there's no longer competing needs for one port of cash. Each project now has its own dedicated funding sources to continue its development journey.

5:25 Operationally, our main financial priority is completing the UIS expansion, which will improve cash generation through higher volumes and lower unit costs. Overall, the financial health of the group has improved and will continue to do so, whilst the group unlocks its strategy across all the assets. With that, I'll hand over back to you, Anthony, on what the expansion could deliver and how the wider portfolio is progressing. Thank you, Hitan. This is the most important near term growth opportunity in the business. We're targeting 1,500 to 1,900 tonnes of contained tin annually compared with an annualized eleven fifty two tonnes in the first half. The ore sorting program centers on installation of the ore sorters, new crushers and a new thickness circuit as well as completion of the mine stripping pushback and subsequent production ramp up.

6:20 This will create the following earnings drivers: more tonnes produced, better cost efficiency and better royalty terms with the intent of retiring the royalty. In addition, if commercial lithium production is successfully developed, this could add a second material revenue stream. WES is already profitable. Our job now is to make it bigger, more efficient and a more cash generative operation. The TIN market provides a supportive backdrop to that expansion. Demand is increasing and is largely underpinned by electronics and solar applications linked to new technologies such as AI and data centers. Supply remains concentrated and exposed to disruption, while new projects remain sluggish to get into production.

7:09 That creates a stronger link between the commodity market and the production growth we are pursuing at Wiese and ultimately gives shareholders direct access to the favorable tin market dynamics. At Lithium Ridge, our SQM funded program has delivered a notable lithium discovery with tin and tantalum byproducts. Approximately 16,500 meters have been drilled across 143 holes and identified mineralized trend has extended from six to around nine kilometers. That's stage one complete. The focus now is on geological interpretation, assay results and progressing towards resource definition. This is a staged conditional project level funding through a globally recognized strategic partner, which lays the platform for the rapid execution of the project.

8:01 The investment proposition provides significant lithium exposure without drawing the full exploration cost from the UIS cash cow. Bradberg West gives ANDRADA and its shareholders exposure to tungsten and copper in additional to moor tin tanks. Early ore sorting test work on historic material has shown encouraging upgrading of tungsten and tin grades. These are technical results, not yet project wide economic outcomes, but display significant upgrading potential of the run of mine feed into the concentrator. Our partnership with BWCAM provides a pathway to stage project funding as we advance the technical work. Again, the strategy is to progress a valuable opportunity while maintaining capital discipline at the corporate level.

8:57 As we enter the next phase, we have also recently renewed the Board. I congratulate Jida as our new Chairperson, and I'm delighted to welcome Neil Gawthor and Lily Newpen as Non Executive Directors to the Board. Neil and Lily bring expertise and deep knowledge in mining, capital

9:15 markets, governance and transaction experience to support the next stage of the business. Our priorities are evolving from building asset base to disciplined execution, delivering the WIIS expansion, allocating capital carefully and unlocking value across the portfolio. You can watch our recent meet the board interviews on our LinkedIn and X pages to find out more about these appointments. This is a new chapter for ANDRADA that is focused on operational excellence, capital discipline and shareholder returns. For shareholders, we see three distinct potential sources of value creation over the next eighteen months. First, a producing tin operating that is now generating profit and operating cash for the group second, an expansion that could lift output and improve unit economics and add additional lithium credits

10:11 third, lithium and tungsten opportunities being advanced with strategic partners. Independent broker valuations illustrate the range of views on that potential. These are third party opinions and not management forecasts. VSA has recently visited site and initiated coverage of ANDRADA. All of our research can be accessed via the research tree on our website. Our responsibility is to close the gap between potential and realized value through measurable delivery. I will leave you with three messages: ANDRADA is profitable and generating operating cash today. We have a funded plan to grow TIM production and improve OIS economics through byproduct credits.

11:01 We have meaningful additional portfolio opportunities supported by strategic partners and a refreshed board.

11:09 We have built the foundations and are now focused on converting them into sustainable earnings, cash generation and shareholder value. Thank you for joining us and we can now take your questions. That's great. Thank you very much indeed for your presentation. Ladies and gentlemen, please do continue to submit your questions using the Q and A tab situated in the top right corner of your screen. While the company take a few moments to review those questions submitted today, I would 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 via your investor dashboard. Abby, at this point, if I may hand over to you to check the Q and A, and I'll pick up at the end. Thank you. Thanks, Alex. So the first question is, firstly, congratulations on the results. It's great to see the first reported profit.

11:57 Could you explain a little about Tantalum?

11:59 The results for this six months show Tantalum revenue at less than oneten of the same six months last year. Why has Tantalum revenue dropped off so much, and do you expect it to stay like this? Thank you for the question. So, Tantalum, we've got a new arrangement with our off taker, that we will actually receive credits within the concentrate. That arrangement has now taken place. So you will start seeing the same tantalum credits come through as we grow and expand the tin production. The tantalum production will

12:36 expand at the same time. Great. Thanks. The next question is, what is the latest news on the Goan to GAP oil supply agreement? You previously mentioned a court hearing in September 2026. What happened at that hearing, and what is the next expected event?

12:56 So the oil supply agreement remains as is. We are not, directly involved with the legal proceedings. We do note that there was a positive, hearing in September. We do encourage both sides, to reach a settlement, and earn coexistence with with both industries, for the better of the Namibian people and the Namibian economy. The Guanjacob asset remains a very high priority target for us.

13:27 Historic drilling, indicates a very strong, project possibility and, obviously, of the ore supply. So we we encourage both parties to reach an amicable settlement.

13:43 Right. Thank you. And the next question is, could you elaborate a little on what a fast track at Branberg West might look like? We first look to reprocess the tailings before any wider ore processing. Do you think you'd put a small plant there or process at Wiese?

14:01 So we we really like the Branberg West project. We've seen some great core come out there. We've we've got we've got ideas of of bringing that to market as quickly as possible, but we'll have to let the results speak for themselves and go through the process, unfortunately. Thanks. Next question. Could you explain a little on what the new jig plant is doing?

14:28 It was stated that it was acting as a pre concentrator, but what does that actually mean? It's expected to contribute to any meaningful increase in output prior to the bigger expansion next year. So the jig part was designed for the GradClub ore. We have taken parts of that circuit and used it in the main in the main circuit. When when there is a legal resolution, we will take... We will recommission the jig plant. But in the meantime, our focus remains on pushing up production at the main plants. Great. Thank you. When do you expect the second stage financing decisions for Lithium Ridge and Brandberg West to be concluded?

15:14 In a minute. Thanks, Hunt. A great set of results. Looking ahead, what are the time scales for the installation of the ore sorters at Wiese, and how quickly would you anticipate production increasing as a result of the installation? So the implementation of all sorters has a number of different components. As as we've seen, thickener, the crushers, the the pushback on the pit, and obviously, the all sorter implementation themselves. These will be implemented sequentially over the over the course of the first half of the year. So you'll see you'll see those come on stream, as my team commissions, each each stage accordingly.

16:03 Thank you. What is the current position regarding the hedging of 10?

16:09 Yeah. So the current hedge ends in November. You know, that's at 42,000, and it's for about 35% of the the production. Going forward, basically, you know, we we would look at the cash flow requirements of the business and our covenant requirements and determine whether we continue to then hedge, you know, some of our production going forward. But it's generally, you know, a portion of production and not the majority. Perfect. Thanks. We had another one on Hedwig, I believe you just answered. Thank you for the excellent presentation, the best we have seen. Well done. Can you please indicate what will the ramp up of production mean for your financials?

16:55 So, it will basically, as as Hinton stated earlier, increase our margins. We get better economies of scale. The greater throughput, will dilute the fixed costs accordingly. So, we do anticipate, much better margins, as as the... As as production increases. And, obviously, the the royalty on sliding scale that we wanna obviously, get rid of eventually, that's... That that reduces. So our margins have have a direct... Has a direct impact on our margins. Yeah. And also to add, you know, your... The tantalum credits, would would increase alongside the 10 production. So you almost get a free carry of the tantalum credits without having to process that anymore.

17:43 Right. Thank you. Can you talk about the 10 market situation and pricing? So we we remain very bullish on the on the TIM markets. As I mentioned in the presentation, it's a it's a supply constrained market very much like copper. You know, demand is increasing. We've seen we've seen inventories drop continually on the metals exchange. But what is very important is that we haven't seen new tonnes coming on stream. Myanmar is probably the biggest question mark at this stage, but we haven't seen a huge ramp up in tin production. And for us, you know, it's all about getting our unit cost lower, get our production more efficient, and bringing the byproduct credits to become a low cost producer.

18:35 Thanks. And just on Wiese, as no mention of tantalum production, has this stopped because of the focus on tin production, and is there an opportunity to process tantalum at a later date? I I think we've answered that. You know, we're getting credits with with the with the TIM. Yes. It makes more economic sense to just get the credits with the TIM instead of producing it. Right. Thank you both. ANDRADA has built a lab in Namibia for assessing and testing some of the critical minerals. There are reports of other companies in Namibia shipping oil to Asian labs to test the reserve level of lithium. Can ANDRADA Lab offer these services to other companies?

19:17 No. Thanks, Moe. What is the timeline and CapEx requirement for putting in place processes to extract meaningful lithium from WES? Well, we're busy working with the European Investment Bank to complete the feasibility studies. They've financed those those studies. So, the... Over the course of the coming year, we'll release that data as as it's... As it becomes available.

19:49 Brilliant. Thanks, Hans. And we've got one final question here, which is could you give a brief overview of what is happening with the lithium pilot plant at Wiese and what work is ongoing? So, as per the previous question, all of that metallurgical test work remains, part of the the EIB sponsored program. So so work is continuing accordingly to that program.

20:21 Brilliant. Thank you, Anne and Hissam. I believe that is the final question. So let me just double check. Brilliant. If I could hand back to Anst just for any closing remarks. Thank you. So as I see I see one question come through that wasn't asked. It says, will you need any debt or equity capital for the current projects? No. Projects are fully funded. We have cash in the bank. We have partners to develop the the extra programs. We've got bank financing to expand our our capital projects, and we are profitable. So a very unique situation for a junior mining company. But, so with that, I don't see any other questions.

21:07 I would like to thank everybody. You know, this has been quite a long journey for the company, for ANDRADA, for ourselves. We're very proud of what we've achieved. We are very confident in where the company is today, and where the company is going in the future. There's gonna be a plethora of news flow across all projects over the course of the coming twelve months, and we really appreciate, obviously, all the all the ongoing support. And just stay tuned, everybody, because things are really gonna get pretty exciting from here. Fantastic. Thank you very much indeed for updating investors today. Could I please ask investors not to close this session as you now will be automatically redirected to provide your feedback, which help the company better understand your views and expectations.

21:56 On behalf of the management team, we would like to thank you for attending today's presentation, and good morning to