Iofina (LSE:IOF) — Interim Results for the six months ended 30 June 2026

0:01 Good afternoon, and welcome to the IOFINA PLC Investor Presentation. Throughout this recorded meeting, investors will be in listen only mode. Questions can be submitted at any time via the Q and A tab situated on the right hand corner of your screen. Just simply type in your question and press send. Company may not be in a position to answer every question received during the meeting itself, however, the company can review all questions submitted today and publish responses where appropriate to do so. Before we begin, let submit the following poll. We do apologize for the slight delay in starting today. I'd now like to hand you over to Tom Becker, CEO. Good afternoon, sir. Thank you very much. Hope everybody is doing well today. Happy to present an update on IOFINA, especially focusing on the first half year results, came out earlier this week and really an outlook for the future, which we're very excited about.

0:49 Go through what what we're gonna be looking at from a presentation standpoint here as a general agenda. Just talk about the company in in in quick terms. I think most of the people that are listening to this call are familiar with IOFINA, but there may be some that are not. So we'll give a quick overview of what IOFINA is and what we do. And in the market that we're mainly in, and that is the iodine market. So we're, give a little bit of history of of of the supply and demand and pricing of iodine and also what kind of markets that, iodine is going into and how those markets are growing. And then we'll get into, what we kinda did in the first half of this year, both from a business standpoint and a financial standpoint, and then we'll get into what I think is, you know and and then those first half of the year numbers, I think, we're very excited about and proud of what we're able to accomplish in the first half of the year. And then we'll get into what I think is even the more exciting aspect of it, and that's our our pathway to 2,000, our growth of our item production that we we were planning to roll out. And why as a successful item company with growing business, why the investment case for IOFINA, in my opinion, is is has a real upside potential and where we think we're gonna be moving here down the road.

2:09 So to jump right in and talk about the company a little bit itself and just talk about our operations, we are a specialty chemical company with a expertise in halogen based chemistry, so iodo, chloro, fluorophle based chemistries with a real focus on iodine and iodine production. And to do this, we we've developed technology over the course of the last twenty years in order to build the business that we have today. And all of our operations for IOFINA are in The United States. So two divisions, IOFINA Chemical and IOFINA Resources. IOFINA Resources is the arm of the business that has basically two goals, two functions, and one is to explore for and develop potential for where we can produce iodine from brine water waste brine water in The United States.

3:01 And once those opportunities are identified, the second portion is to build and produce iodine from these particular sites. So very focused operation. Where's the iodine? Where can we economically produce iodine? How can we use a resource that's already being produced from oil and gas in order to extract a valuable resource from a waste stream and then how and then build and operate these plants on a very low cost basis. And all those kind of things are done in the core areas that are shown in in the map here. So there's two core areas in the state of Oklahoma, one in the Northwest Core area, which we have five plants in operation currently, one core area in the Central Oklahoma area where we have our latest three plants in operation, and we're very excited about the new third core area in the Permian Basin, which, IO 12 is currently being built and should be up online here, pushing water through the plant in the next few weeks.

3:58 To support the IOFINA resources division, we do have an office in Denver, Colorado to support those kind of activities. The IOFINA chemical side is also a very a very major portion functional unit of our organization. It's located in Covington, Kentucky just outside of Cincinnati, Ohio. And what IOFINA chemical does is it takes all the iodine that IOFINA resources creates. Either takes that iodine and creates value added derivatives that go into various applications or is our total sales arm of the organization that sells that crystalline iodine that's produced at IOFINA resources throughout the world into various markets that need iodine. And to jump into those markets that need iodine, let's talk about the iodine market a little bit, how we view the iodine market, its current pricing and demand situation, and where iodine goes. So a little bit of a history of where iodine comes from, who manufactures it. About 60% of the world's iodine, maybe a little bit more than that comes from Chile.

5:04 They they mine iodine from ores in the Atacama Desert, and this is a pretty labor and rock moving intensive process, energy intensive process to extract iodates from ores and then refine it in order to get iodine. There's four major manufacturers in Chile, SQM being the largest, which produces about a little over a third of the world's iodine. The rest of world's iodine comes from brines, but what makes IOFINA unique from the rest of the world is we are the only one that's usually oilier produced brines from third parties. We go to where these brines are already being already coming up with oil and gas operations, so we are not drilling our own wells or own disposal wells for this brine. We partner with oil and gas companies, extract the item from them, give it back the water, and everybody benefits from the iodine that IOFINA manufacturers.

6:02 And without IOFINA, it would never be realized. The market itself continues to grow. In 2026, we expect the Iodine market to be at or around 40,000 metric tons of production on an annualized basis. And this chart also gives you an idea of how pricing has been. And pricing over the last four years has been fairly stable, generally over $70 a kilo on a on a 100% basis of sale price of iodine. And we believe this firm pricing is an is a more normalized price that we're gonna see here moving forward. Can never predict the future, but right now, for what we're seeing in the market from the demand from customers that we associate with the information that's in the market about supply, we do believe that the supply and demand for item is fairly well in equilibrium.

6:52 But what this also means is that, as you can see from the chart, is that the iron market continues to grow. We'll talk about the applications in particular that are looking to grow. But if this iron market, which has on average over the last number of year grows at about 3%, that means there's an additional 1,200 metric tons of capacity or thereabouts that needs to come into the market in order to meet demand. So IOFINA's ambition to continue to accelerate our iodine production and just meet a fraction of that ongoing demand, we believe, is the right action in a growing market, which also wouldn't disrupt the supply and demand equilibrium. Just from a demand standpoint, demand in Asia is especially growing compared to the rest of the world.

7:41 And in particular, some of these app these are the major applications that iodine goes into. The one I'll really focus on a little bit is X-ray contrast media, although you can see there's a number of different areas that iodine is used for around the world. X-ray contrast media, these are injectable drugs that go to help create more of an image in CT scans, especially as it goes to focus on soft materials in your body. So if it in certain application, contrast media drugs are injected into the body, that way these images pop and and these x rays and CT scans can be much more easily interpreted by the doctors and the technicians.

8:30 And that's a very much growing application for a few different reasons. One is that the aging population around the world need seeing more of these x rays and CT scans. The other major aspect is that global populations are getting more access to what I'll call Western medicine or modern medicine techniques. So especially in Asia, where some of these medical techniques weren't available or haven't been available in the past are becoming more and more readily available to their populations. But, you know, X-ray contrast is only a portion of that. There's a a number of other applications which do have some human health app tie ins, including iodine cons compounds are used to manufacture certain pharmaceuticals.

9:24 Everybody needs a little iodine in their in their diet in order to control thyroid function, but there's also some other, you know, industrial and and other applications. IOFINA chemical produces a biocide that goes into paints and coatings to prevent mold and mildew and in the can itself and on the wall. We manufacture things that can catalyze acetic acid manufacturing, animal health additives to, as a micronutrient in animal health applications to help cows and and other farm animals grow bigger and fatter and provide more value to the farmer when sold. But there's other industrial applications as well, such as heat stabilizers and certain automotive applications.

10:15 So I I guess the message is, you know, IOFINA is a iodine manufacturer with a focus on some iodine derivatives, and we believe we're in a nice growing market with expanding applications. And just to jump into the first half of twenty twenty six, which we're very proud of the results that came out earlier this week. You can see a number of bullet points here, especially at the top, which on the next slide are kind of reiterated, and I'll allow Malcolm to review some of those. But I just want to focus on the second half of our operations that we have done year to date in 2026. So in the first half of the years and then between the end of June and currently. So some big operational accomplishments that we've done is we announced in 2026 an agreement with a new brine supplier to add additional brine supply to our IOF 11 facility, and we'll talk about that here a little bit of what that really means, which is likely to increase production at that particular plant by about 50%.

11:24 We've been building I O 12 throughout the first half of this year and into the third quarter of this year as well and should be online here in the next few weeks. And earlier this week, we very excited to announce the next rollout of plants, the agreements for what we're gonna be doing next after I o twelve, and we'll talk about that here in a second. But right now, I think what I'll do is throw it to Malcolm and change it to the next slide, and he can go through some of the key performance indicators that we had in the first half of twenty twenty six and the, I think, pretty outstanding numbers that our business was able to achieve. Okay. Thanks, Tom. So working from the top, the most important driver for our business, unsurprisingly, is iodine production, and that increased by 29%, 26% versus 25 And that 29% increase represented 88 metric tonnes additional in '26 compared to the first half of twenty five.

12:28 And of that 88 additional metric tons, 50 metric tons came from plant number IO 11, which only came online after h y 25 was finished, but before h y 20 '6 started. So that was 15 out of that 88. And there was another specific plant that actually kind of surprised us by producing significantly more than than we'd anticipated due to the way that the oil and gas partner chose to bring on new wells and results of some fresh drilling. And that gave us an extra 18 metric tonnes over and above what what we thought. So those two things together add to about 68 out of the total 88. In addition, the first half usual expectation is that the first half numbers production will not be as good as the second half because the first half includes the winter period, especially January and February, which in Oklahoma can be pretty cold and cause issues. And in fact, h y twenty five did have that type of winter in Oklahoma.

13:42 In fact, quite a severe version of it. And the consequences that, that the cold means our chemical reactions don't work as well as they do when it's warmer. It also can mean that our oil and gas pump has pumps down their wells, for example, start to ice up, and they have to take some of our water supply offline while they while they repair and that type of thing. Whereas, yeah, for h y twenty six, the weather was surprisingly clement. And to be frank, everything went very well. The product you know, the the amount of production from the legacy plants, never mind the couple I mentioned already, by and large, better than we'd expect better than we'd expected.

14:30 The promising, so sorry, beg your pardon. Move down to revenue, we've got thirty one point three twenty six against 29.2 for '25, 7% up. If you look down at the bottom line, you'll see that the average iodine price, frankly, barely moved. It shifted up just a little bit. $25.74 dollars, $27.26, $74.69. So that revenue number, to the extent it includes iodine sales, which is mainly what it does, is is is a reflection of additional volume rather than any any pricing effects. The gross profit came in up to 10.2 against 6.3 for 25. That's a big increase, and it's a reflection really of well, a couple of things. One, the amount of production, which was, one could say, perhaps about as high as it reasonably could have been, And and also the fact that our direct production costs were held pretty low, and the numbers came in on budget, if not slightly better.

15:39 And we were able to make some savings with the cost of chemicals through some new negotiations with the suppliers. And the overall effect was that our total direct costs of iodine production went up by 10%, whereas the volume produced went up by 29%. And therefore, the average cost per kilo of our iodine fell by 15%, and that generated a significantly lower cost of sales. And that, in turn, resulted in a larger gross profit and feed and fed down to a larger EBITDA number. So in fact, with EBITDA, we wind up with a GBP 6,600,000, which is double the GBP 25,000,000 number of GBP 3,300,000, and we're very pleased with that.

16:30 Post tax earnings, a lot said about that, but the GBP 2,500,000 for GBP 25,000,000 is kind of flatter because it includes a government grant, not a trading item, but we'll come to that in a later slide. Net cash, we're also happy with in the sense that it's GBP 7,200,000 positive. Last year, it was 1 point eight million negative, although I would mention that we still have three and a half or four million dollars of CapEx costs still to feed through from the construction of the latest plant, IO 12. That money is getting spent or some of it's been spent by now, and I think the rest of it will be out in the next month or two. Okay. Great. Yeah. And I'll just, you know, point one other thing before we get off the slide is that, there's a reason why this chart's on this slide. We're very proud of the growth trend that we've had over the last three years.

17:24 And it's mainly driven by the execution on, yes, in the resource side by increasing the production year over year, building new plants with IO12 coming online here in the next few weeks. That will be our fourth plant in four years, and we're really proud of the execution that our teams have done. Just to get into a little bit more detail about the first half of the years on either side of the business. A lot of this, we've covered already. But as Malcolm mentioned, our H1 twenty twenty six production even exceeded our revised upward target. So we had things really work our way in the first half of the year. Malcolm mentioned this in the last slide, but I think it's pretty important to point out the third bullet on this slide is that our average production cost is 15% lower.

18:13 And some of it was luck from the weather, but really some of it was things that we've done to improve water volumes, work with our suppliers to try to increase the amount of water. But really, our sourcing department did a really great job in chemical sourcing. One of the things we did note in result commentary that we just put out earlier this week is that while we saw improved chemical costs in the first half of the year, we have seen a little bit of creep of these chemical costs moving into the second half of the year, and that's mainly due to increased raw material costs, mainly influenced by fuel cost increases and some some other things that are manufactured in The Middle East. There's a little bit shortage of supply around the world, and, of course, you would imagine that's gonna creep chemical costs up.

19:02 But we do a really good job and try to contract these major chemicals that we use, especially on the IOFINA resource side to try to minimize any kind of cost changes that we see here in the future. We did spend $5,800,000 in CapEx in the first half of the year. As Malcolm mentioned, it was it's we haven't fully paid for IO 12 or the IO 11 project that we that we started in 2026. So there's about half of the I o a little more than half of the I o 11 project was paid in this 5,800,000, and I think, what, around $4,000,000 of of I o 12 costs were were spent in the first half of the year. As we've already mentioned, we're in the final stages of our new biggest plant to date in the Permian Basin.

19:50 And, you know, it's it's up to the IOFINA resource business development team to have a pipeline of future plans after this in order to meet our pathway to 2,000 kind of goals. And very proud that we announced the the next plants in our in our line of of of increases of our iodine production capacity here announced earlier this week for or last week for IOF 13 and IOF 14. And to summarize a little bit on the IOFINA chemical side as well. Again, all the all the iodine funnels through IOFINA chemical, and it's important and imperatives as the IOFINA resource side grows that the sales team on the IOFINA chemical side continues to expand our customer base in order to ensure sales of our item based products.

20:39 And we have long term customers, good customers that are looking to grow with IOFINA's growth as well. So excited about the the work our sales team has done. We we have basically have sales in hand for all of the projected production of IOFINA resource crystalline iodine that we plan to sell into the open market throughout the rest of the year. The demand for IOFINA iodine is strong. Our customer base is solid, and we'll be start selling our iodine or taking purchase orders for iodine into 2027 here shortly. Some other things about iodine and chemical. Again, we make iodine and non iodine derivatives besides selling the crystalline iodine itself.

21:30 Last year, we announced that we were adding a new product to our line of iodine derivatives, and that is a feed additive, so a micronutrient to help specifically cattle, but some other aspects as well. And it was our largest revenue derivative in the first half of twenty twenty six. We continue to have about 10% of our sales into non iodine derivatives, and those are focused on some specialty gases and and one other application that goes into the Great Lakes, which didn't have realized sales in the first half of the year, but we'll have realized sales in the second half of the year. And we continue to focus on research and development for new derivatives for iodine chemical, especially for those applications that may be growing in the future.

22:19 If you remember back with in our annual report, we mentioned some potential new applications for iodine in the solar cell industry and the refrigerant gas industry, and we're working hard at IOFINA Chemical to be a player in those areas if those applications end up taking off. So we do have some summaries of the financial reviews. Malcolm covered a lot of this, but he's going to point out a few more things on the next few slides that we feel are important to mention. Okay. So here we are with the income statement. As Tom's just mentioned, the non iodine figure on the second line of $2,900,000,000 for 'twenty six is kind of, we would suggest, understated because we were expecting to make a delivery to Great Lakes Fisheries for a particular product before June 30, but they decided to delay it, It's gone into the second half of the year. So that £2,900,000 could well have been at least 3,500,000 probably more, in fact.

23:20 We've talked about cost of sales and EBITDA and what led to the significant improvement there. Going down a bit, Yeah. You can see Tom's highlighting it as government grants, ERTC. ERTC stands for employee retention tax credits. This is a US Government COVID era scheme for support and relief where people have kept, or I should say, did keep employees on even though their businesses were adversely affected by COVID, and and and they had less coming in to to to finance their payroll. It's taken a heck of a long time to come through, but that's just the way this scheme has kind of played out because there are a great number of claims made under it, and it took the US government a while to kind of decide what what approach it was taking to validate them.

24:14 Apart from that, I think we could move on to the next slide. Okay. Balance sheet. Probably plant equipment, 41.7. It's up. Whatever it is, 6,200,000, and that's a reflection of the additional capital expenditure less depreciation. That £5,800,000 you've just seen, I think. Working capital, pounds 13,000,000 net versus £13,800,000 in FY 'twenty five. Not a lot of change there. We do get some fluctuations in the overall number depending, I think, above all of when particular sales are invoiced. We have can have and frequently do pretty large amounts on individual invoices, possibly as much as, let's say, $1,200,000 for a full 18 metric ton container load of iodine.

25:08 And if two or three of those invoices get in get slightly out of sync or into a different period, that can swing the net the the movement in working capital. But this is a pretty consistent set of numbers, one period versus the other. Down below, we've got bank debt of £5,700,000 Of that, 4,000,000 relates to a drawdown on a CapEx facility that we made last year to support the capital expenditure that we were laying out on IO11 plant. And the other 1,700,000 making up 5,700,000 is the remainder of a term loan of 10,010 million, I beg your pardon, dollars that we took out in September 2020 when when we did a pretty thorough refinancing with our bank.

25:59 And that'll that 1.7 will be paid off by the middle middle to late next year. So net cash wound up at 7,200,000 versus a negative net debt position of 800,000 previous year. Lease liabilities were up at 700,000 from 0.2 The reason for that is that the lease we had on the office in Denver, where our IOFINA Resources, which runs the iodine production, where they're headquartered, their lease ran out. And the way the lease is accounted for under IFRS, International Financial Reporting Standards, No. 16, is that the total outlay on the lease over the whole period is capitalized and then it's depreciated.

26:46 And last year, we were down to very little time remaining. We've now bought a new lease and a bigger figure that will, in turn, get depreciated down over the next two to three years. Finally, on this slide, we've got deferred tax of £5,000,000 That reflects tax that we've, if you like, saved because we've been able to claim a lot of capital expenditure against what would otherwise be taxable profit. And that was considerably assisted by the arrival of the OBBBA bill in The States under President Trump that was signed into law last July, and that has made it significantly more possible to effectively have a 100% write off of capital expenditure subject to certain limits against tax. That saved us that has helped assisted our cash flow.

27:46 Okay. Can we move on, Tom? Yeah. So here's the cash flow itself. Kicks off with an EBITDA. Working capital in our favor for this period as a get as a not not not particularly significant matter to us for reasons I've already mentioned. So we generated £7,800,000 from operations. We spent 5,800,000 on CapEx, demonstrates that the capital expenditure that was that's in the books for the first half was entirely funded out of cash out of operating cash flow. Left us with 2,000,000, then we have bank repayments. And we wind up with £12,900,000 of cash as opposed to 6,400,000 last year. And as a just as a little addendum, we are currently still at about $12,000,000 cash level as of the last week or two.

28:38 I'm pleased with that. Great. Thanks for that review, and and I'm gonna switch gears here a little bit. We've talked about where we've kind of been and what our plans are, and now we're gonna detail a little bit about how we're putting that into action. So give a little bit more detail on item number 12, which we we've provided this information to the market, but there may be a little bit more detail here. Again, it's it's it's a bigger plant that we've ever built. Most of our plants in Oklahoma have the capacity to to take in about 20 thou 25,000 barrels of water per day. And this particular plant is being built in order to be able to take in about 50,000 barrels per day of water. It's in the Permian Basin where it's the largest hydro producing hydrocarbon basin in the world.

29:27 There's a it's hard for me to even imagine there's 20,000,000 barrels of brine water produced in the Permian Basin every day. And our partner that we're partnering with here is handling over 2,500,000 barrels of water per day. Now not all of that water, in our view, is economic has economic amounts of iodine in the water to be able to extract iodine economically. But our exploration team has done a really good job in identifying areas in the Permian Basin such where we're putting IO12 and for future sites that we believe are gonna be real opportunity for expansion for the organization. Again, the timing of this, in the next few weeks, we expect IO 12 to be moving water through the facility and ramp up in production shortly thereafter.

30:17 The plant capital costs, when we first started this plant, we thought it would be between $89,000,000,000, and it looks like it's gonna come in right around $8,800,000. So within the budget of what we expected in this area. And again, we have a strong partner who is working with us to try to get this thing online as soon as possible, and we are very confident they're gonna try to maximize this 50,000 barrels of water to our site as soon as possible. So excited about this plant, excited about possible expansion opportunities in this particular area as well, not only with our current partner, Western Midstream, but we're in we we we have other people that handle large amounts of barrels of water that had good iodine concentrations discussing future sites with IOFINA also.

31:07 Additionally, the other exciting thing that has come recently announced, I believe it was last week, was the agreements that we put in place for IOF thirteen and fourteen and also the Iodine pipeline project that we completed in August 26. So let me go back to a project that we completed in 2026. You all remember IO number 11 came online in 2025. It was about a expected to be about a 100 metric ton kind of capacity plant in an area of of Central Oklahoma. It is a it's a plant that has lower brine volumes but higher concentrations.

31:53 A good plant by by itself in all respects. What we're able to do is partner with another brine operator in the area and working with our existing partner came to agreements to allow for an additional water supply coming into I O 11. So once we got those agreements arranged, our our partner our new partner built a pipeline from their water source to our plant and back. We funded that project, and what that's gonna do is be able to get another about 50% capacity to the particular plant. So, you know, 100 metric ton plant now is gonna be somewhere between a 145 and a 160 metric tons of production at that site. So we're working hard to try to maximize the amount of water to every one of these sites. These kind of projects aren't easy to do. The more likely things that we do to our existing plants is work with our existing operator to try to maximize the amount of water that they can provide to our individual plants without over pressurizing their system.

32:57 And I think the real important news that we announced is an agreement last week to build IO 13 and IO 14. And, again, this will be in the Central Oklahoma area, an area that we're very familiar with, familiar with the water, familiar with contractors and builders to build these operations that we've done on IO 9, IO 10, and IO 11. Signed a few weeks ago. We can provide more details a little bit later, but, you know, overall, the item plants in Oklahoma are somewhere between a 100 and a 150 metric ton ton of plants on average. We anticipate that the the total volume from these two new plants is likely to be higher than the average amounts of plants in Oklahoma. So on average, a bigger plant in Oklahoma. So looking forward to provide more details when those are available and final details or work out with our partner to give a little bit more insight into the in the production and timeline of this. But we're very ambitious that we believe we're gonna get these plants online in the first half of next year, and we'll be updating the market on that progress.

34:14 So what does this all mean? So Malcolm reviewed a lot of our financials in the first half of the year. If you look back at our financials from 2025, we're very proud of the continued growth that IOFINA has done. In twenty twenty five's annual report, the management and the board of IOFINA laid out our route to 2,000, the pathway to 2,000. You know, we went from 500 metric tons of production to once IO 12 is opened up, we'll be at about a thousand metric ton run rate of our item production. But we feel with the growing item market, our expertise in this area, the opportunities that we have in not only the Permian Basin, but as you can see with IO thirteen and fourteen in Oklahoma, that we have the right opportunities to continue to increase the capacity of our iodine production.

35:13 We worked hard on our balance sheet. We've net cash, as Malcolm pointed out, at $7,200,000 in June 30. We worked hard. And maybe, Malcolm, can you mention the debt facilities that we have Oh, I'm sorry. So we have in place in order to help fund these future sites as well? Yeah. Okay. So we've got a $10,000,000 facility with our bank, which is to be used on, well, not 12, but in fact, probably IOF 13 and IOF 14. And in addition to that facility, which is which takes the form of term a loan with a drawdown period up to the end of next year. And then after the drawdown's finished, and it's repayable over seven years, and the interest rate is so far SOFR, secured overnight financing rate plus 2%, which we think is well, it's a rate that applies to various other arrangements we have with the bank. We also have a $6,000,000 revolving line of credit, which is effectively a kind of overdraft. We've had that in place ever since the refinancing back in September 2020.

36:27 We've never used any of it. And going forward, it may be something that we will bring into action if needed depending on how the spend on new new sites goes versus money that comes in all the time from normal trading operations. Yeah. Thanks for that update. So I guess the point I think we're trying to make is that, know, in order to obtain this goal of the road to 2,000 in the next few years, not only do we have to have the projects and opportunities to do that, but we have to be smart and have a healthy balance sheet, good banking partners to help fund these kind of operations. And once these kind of plants get up and going and start generating cash, our projections look very enticing here in future once we start getting plants like IO12, thirteen, fourteen and the next generation of likely larger plants, fifteen and sixteen online. So the last couple of bullet points, we expect to exceed the production capacity of 1,000 metric tons once IO-twelve comes online.

37:38 And this pathway to 2,000 with IO-thirteen, IO-fourteen and the pipeline of ongoing sites with multiple brine suppliers that we're in negotiations with is really exciting for IOFINA and its growth story. So just to summarize a few things of why we think, basically, IOFINA is a great place to invest. And personally, I think we're not getting enough credit for what we've not only done, but the prospects that we have in the future, the opportunities that build plants with rapid payback, and what that's gonna mean down the road from not only from cash generation, but actual profits of the organization. So, you know, we have we continue to expand our output, especially the the capacity for iodine by building new plants. With IOF 12 coming online, that's four plants in four years. With IOF thirteen and fourteen coming online in 2025, just so those plants, that'll be six plants in five years. So with this excess capacity and strong financial discipline that we've had, we we really have a balance sheet that supports this growth.

38:53 And with an eye to market that is expanding, Malcolm and I personally and our board really think thinks it's the right time to increase that growth that we've seen over the last number of years and put our technology into into action in new core areas like the Permian Basin. We invest into these plants that have rapid paybacks, and this will eventually cause, you know, this tremendous amount of cash generation in the future. We do our very best due diligence to ensure as best we can that these new plants, we estimate the cost and the long term capabilities of having supply at these particular plants.

39:40 You know, there hasn't been any kind of shutdown of any plants that we've built over the last ten years of iodine of of of IOFINA's growth. So we're very proud of the due diligence that we have in putting plants where this water really congregates. So we're executing these this pathway to 2,000, both optimizing existing plants, but really building the new larger facilities to maximize our production is really gonna get us to that 2,000 metric ton goal that we have in mind. So, know, what what are we looking at here in the near future where we covered a lot of this? As we continue to expand our iodine production, we expect to re achieve record results like we did in the first half of the year. We expect increases in iron production all the time, and the increases in iron production as long as we can control costs and the iron market continues to expand, profitability should increase at the same time as well.

40:41 We are executing these these new plants, the I O 11 pipeline project, the Permian Basin I O 12 project, and the new plants at I O 13 And 14, which were agreed to in terms in a few months ago or sorry, a few weeks ago, be once they're online, be our sixth plan in five years. So as I mentioned in the previous slide, we do have a a lot of opportunities for additional plants, even these bigger Permian based plants, which should really accelerate our growth here moving forward. So with a high with a good IVAN market economics, steady prices, we're on track to meet market expectations in fiscal year twenty twenty six and really excited about what 2027, 2028, and 2029 looks like. So we continue to develop chemical derivatives and our customer bases in order to support this expansion on the IOFINA resource side, and we're really just excited about the future of IOFINA and the growth that we expect to achieve.

41:47 And with that, it's been a pleasure presenting to all of you, and I'll throw it back to IMC. Fantastic. Absolutely fantastic. Thank you very much indeed for the presentation. Ladies and gentlemen, do please continue to submit your questions just using the Q and A tab on the right hand corner of the screen. I just want the team to take a few moments to review those questions submitted today. I'd like to remind you that recording of the presentation, along with a copy of the slides and the published q and a can be accessed via your investor dashboard. As you can see, guys, we've had a number of questions throughout today's presentation. If I may just ask you to click on that q and a tab, where appropriate to do so, just read out the question and give you a response. I'll just bring your cameras back up as well, if I may. Yep. There we go. Camera's back up. Yeah. If you could just read out the questions where appropriate, I'll pick up from you at the end. Thank you. Yeah. So we'll go through the questions. Not sure we can give answers to all of these questions. We'll pick and choose some in these other questions that we can answer outside of this presentation time. We'll try to provide written answers where appropriate. So the first two questions you've seen already and and can talk about those a little bit. And the first one is at what point in the journey do you feel that a maiden dividend will be paid?

42:57 The the quick answer to that is we keep reinvesting the cash generation into new plants and and other CapEx things within the organization at existing plants in IOFINA PLC. And right now, with the with the pipeline of opportunities and our growth ambitions, we feel like that's the best use of cash. Now if and well, when the company gets to a point where we're generating a tremendous amount of cash, I think at that particular time, while the board always talks about dividends and buybacks and things like that, I think that would be a more appropriate time to talk about dividends at that point. And then secondly, a few months ago at the AGM, I said building two plants would cause sales issues coping with the increase in production. What's changed?

43:44 I think the opportunity that we have in Oklahoma here for these two particular plants is is a it's a important opportunity that we wanted to take advantage of. We met with our sales team and challenged them to be able to continue to expand our customer base for iodine sales around the world. After surveying the market a bit, we're comfortable that maybe this a little bit more of acceleration of growth would be available to be able to sell into the marketplace. So we're comfortable that we'll have the sales avenue for the item that we're producing by building two plants at once. And the other thing I'll say with respect to building two plants at once, and I'm not sure if there's another question about it, but, you know, we are working hard. Our construction team is making sure that we have the resources in place to be able to do two plants at once, which is a little out of the ordinary for us. But since we're moving back to Oklahoma for these particular sites, we have a good set of contractors, similar kind of engineering drawings, and we understand the regulatory environment to build these build these plants.

44:53 The next question can give some more guidance on the likely annualized tonnage at IO 13 And 14 as so far has been a little bit vague. And yes, it's been a little bit vague. We're working out the fine details with our new partner for IOF thirteen and fourteen. We hope to be able to give some more direct numbers here in the near future, and we'll get that into the market as appropriate when we have those numbers finalized. Let's go on to let me look at some other things. Malcolm, this is something I think you addressed, so you may be a little bit more apt to talk about it and has to do with a little bit of year over year differences. But the question is, hi, Tom. Nice interims. Crystal and I, and sales were up 31%.

45:42 Derivative sales were up 17%. Item prices were marginally up, but revenue was up only 77%. Has something been deferred? Well, I wouldn't say, and Malcolm can help me with this. I wouldn't say anything's been deferred, but 2025 had some carryover sales from 2024 that enhanced the sales in 2025. So when you look on a year over year comparison, the 2025 sales were enhanced. Is that an accurate That's thing to say? Yep. That's entirely accurate. Okay. So that's the main driver for why revenue increase year on year was a little bit less than you would expect, basically, because there were carryover sales into the early part of twenty twenty five. IO '12 pushing water through in the next few weeks. Please expand on this delay. So we all and and the next question is very similar to that.

46:35 So we we are within weeks of where we thought this would be, so we're not we're pretty pleased by how this build has gone through. Of the things that we didn't anticipate in building in a new area is increased regulatory requirements. Having inspectors coming through and approving certain of the build applications has caused some delays. So building the buildings that are occupied by people, the area that which we're building in now is a little bit more strict than where we were in Oklahoma. So the major components of what we're building in the Permian Basin have all gone as planned. Some of these fine little things have caused a little bit of delay. A little bit of lesson learned so that when we build our our next plan in this particular area, we should be more apt to be able to handle those kind of different construction criteria in that area.

47:39 I'll take a few more questions as I go through this. This one is which potential new uses of iodine do you see most likely to be successfully developed in the next few years? We mentioned a few things. I can't remember if we did in the annual report, but I know we did in the or in the interim report. I know we did in the annual report. That's a potential new iodine applications in solar cells, refrigerants, and potentially even semiconductor use. For me, from what we understand in the market, the most likely application that could cause significant increases or significant use of iodine, not significant increases, is likely refrigerant gases for use in electric vehicles. We don't think it's gonna be a significant new use in the next eighteen to twenty four months, but we could see some significant quantities start moving into that particular area soon thereafter.

48:35 And then let me pick out a couple a question or two more. I think we've covered most of these, and some of the other ones, I can't really do this. I think maybe we'll leave it there and try to answer some of the other questions as best we can through written answers. So, again, I appreciate everybody's time today, and I'll throw it back to IMC. Fantastic. Thanks indeed for updating investors today. Can I please ask investors not to close this session?

49:22 It should be automatically redirected to provide your feedback in order the team can better understand your views and expectations. This will only take a few moments to complete, and that is greatly valued by the company. On behalf of the management team of IOFINA PLC, we'd like to thank you for attending today's presentation. That concludes today's session, and good afternoon to you