Metals Exploration (LSE:MTL) — Investor Presentation

0:00 Good morning and welcome to the METALS EXPLORATION PLC Investor Presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged and can be submitted at any time by the q and a tab situated in the right hand corner of your screen. Just simply type in your questions and press send. The company may not be in a position to answer every question received during the meeting itself. However, the company will review all questions submitted today and publish responses where it is appropriate to do so. We begin, I'd like to submit the following poll. And I'd now like to hand you over

0:32 to Darren Bowden, CEO. Good morning to you, sir. Good morning, Alessandra. Thank you very much for the introduction. Good morning, ladies and gentlemen. Thank you for your time today. We look forward to going through our latest investor presentation with you. And those who were on last time, you can see I've got a haircut. So, hopefully, that's not too intimidating. The the presentation, by the way, covers a lot of information, which I won't speak to directly because I really wanna present the forward position of the company and where we're going to go. However, there are some slides which I'll stick on for a little bit because I think there's some very good information of how the company has been performing and where we've gone over the last three years. So just moving to some of the highlights.

1:18 The company over the last three years has grown very well. We've got stable production, and we had record gold recoveries and gold production in 2021. Ranrino has a lot of still has some potential for some extensions to the existing mine, and we'll talk through that in more detail as we get into the slides. And at this stage, we've got about five years of life of mine remaining. We now have a very solid track record in The Philippines, and our production numbers will remain stable for the next five years, given all technical issues within the process plant and mine have been solved. I'd like to move to the next slide, just giving you some sort of the guidance for 2021 was up to 71,000. We actually outperformed 72,005 ounces.

2:10 That generated about $130,000,000 of revenues, and we ended up being able to draw the debt down by $21,500,000 with total payments of about $39,000,000 in 2021. Gold recoveries are now stabilizing around the 85% mark, and that's where we're looking and focusing our schedules going forward at about the 85% mark. Maintaining that recovery and that production rate around the 70,000 ounces on a year by year basis. Some of the highlights for the year. We've achieved over now 15,000,000 man hours without a reportable time injury. So, the business is running very well. It's safe, and, the achievements are speaking for themselves.

3:02 The key issues that I do wanna focus on as we go, through this presentation are the forward looking strategies and the the options to try and build value for shareholders as we go forward. And the the key areas are twofold. It's near mine exploration to extend the existing mine life by as many years as possible, while in parallel looking at M and A opportunities as Philippine centric to try and use the resources, the technical know how, and the boots on the ground that we have in The Philippines, building a, a stronger company with, more operating performances through secondary operations. We will continue to focus on our cash flows, and we'll continue to focus on the priority of getting our debt down as quick as possible as we go forward.

3:55 And I'll talk through those strategies in a little more time as we go through the presentation. You can read the financial numbers. I've talked through them. There's not too much there I wanna speak about. The debt has come down. And by quarter four this year, we should have the, the senior debt under control, and that will then convert METALS under the existing agreements to a 7% interest, which, is significant against the 15 that is currently accruing on the METALS debt. So, as we draw the debt down quicker as a priority, we are going to get, a lower interest rate as we go forward, leaving the, the company in a very good position to start looking at those alternative opportunities and looking at bit of the free cash moving into other areas rather than directly into debt, and that's our focus.

4:51 This slide here, again, just shows you that that drawdown of the senior and puts us in a very strong position to have that senior debt paid this year. And when it is paid, that that means that becomes a ticket that we can actually move forward with and look at those opportunities as discussed. The key issue we're dealing with here is the pro performance of the business has been, you know, starkly obvious. The the growth and the tech the technical changes we've made have enhanced performance moving recoveries from the, you know, the 50% mark right through to the 84, 85%, and that's on a lowering head grade. So the team have done a very good job. The design of the mill is a 1,700,000 ton a year mill. We're running at 2.1.

5:38 And at that higher percent higher run rate, we are achieving, a higher recovery as well. So overall, the technical issues in the, in the mill and in the business have been solved, And really now it's sustaining that that business performance to sustain that cash flow as we go forward. And that is our key focus in the operation as it stands. So everything there is running very well. And, you know, I'm happy with the strong team that we have on-site, and we have in The Philippines managing managing that production.

6:11 I won't talk through the capital structure. You can all read it. The the shareholding hasn't changed much. There's a small movement in the retail area up and down, but, generally, we have a a stable share price, and we have a, a very stable investor base, of all the key shareholders, which hasn't moved, for quite a while now. And, really, it's, our focus to try and enhance their value as we go forward, once we get the debt back to a position where we can start looking at cash flow and moving into other areas. I think everybody knows about The Philippines. I'm assuming if you're on this call, you've, you have, been following what's going on there. The Philippines is a mineral rich country. There has been some very strong movements in the federal government of the Philippines to open up mining again.

6:58 They believe that the the economy will be mining based or or called primary industries based as it goes forward, and that's that's very for a developing country, that's critical. And therefore, any of the bans that used to be in place on open cut mining and on other mining ventures have been now removed, giving opening up the way for the development of larger and more profitable mining ventures within The Philippines. At this stage, we haven't seen a lot of financing coming back in to follow that, but we do believe with our our management team, with the, the enhanced, business relations we have built in The Philippines that there will be opportunities to grow this business through that, that m and a strategy with the, with the federal government, opening up the doors to to allow that, that business to go forward. So we're very, you know, bullish on The Philippines, and we're very bullish on the the way the government's moving. There is a new election coming up in May.

7:55 And in May, we do see that the two front runners for the presidency are both pro mining. So in either case, it looks like we have a a very good chance to have a government that will support mining going forward in any case. So there's all really, the messages from the federal level are all good news for for METALS EXPLORATION PLAYING THE PHILIPPENS. Just a quick overview. I don't wanna talk to these slides too much until we get to the ones that I I think are more focused. Really, Ranmarino, been mining now for in the order of seven years, so things are moving forward pretty well. We do only have 02/2025, 26 mining left, and I'll focus more on the exploration near field to give you an idea of what's going on in the extensions to the mine to the north.

8:48 You know, generally, looking at just under 430,000 ounces left in the mining pit. That doesn't include an inferred, that's the reserves. There are some inferred resources, which will come into that to increase that marginally and then the exploration drilling as we go forward will help. And we are looking at that this year. There will be some expenditure in that area. You can see slide 13 really does give us a good give a good indication of where the business has grown and how it's grown. In the start of the pandemic, we had some significant issues in power supply from the the national transmission grid, which did cause some issues in terms of production in the phase in the BIOX area. But that has since stabilized, and since then, we've been achieving a strong production on the back of reducing head grades. So everything's going well in the production area.

9:46 Not much to talk about here. As I said, where the mill throughput's up, recoveries are up to where we want them to be, and overall, the design parameters that were specified in the original design documents we are meeting, which means that, you know, BIOX is now performing at 92% oxidation. Flotation recoveries are up to 95% as they should be, and they are sorry. CIO recoveries are up to 95% in flotation. We're up around the 88%. So everything's going well, and the business is performing, pretty well overall. Mining operations. The mine design, is one of the focuses we've had over the last three years to try and make it more efficient. We're now, into a 100% backfill in the pit, which provides us with a very efficient strategy for mining.

10:34 And, overall, the, we're at stage three in the mining sequence, stage two still being mined, and then we have stage four and five to go. Given that, nearly all waste is now coming back in pit, the size of the fleet, there's no changes in the structure of the business in mining, and therefore, no increases in cost as we go forward. It's now an efficient little pit that runs pretty pretty well. So we won't see, except for, inflationary pressures that every mining company is seeing around fuel and other other consumables, we won't see capital increases in the business to support ongoing operations in terms of, equipment growth or equipment purchases. Really, it's just consolidation of the fleet that we have at this stage. So the key focus for us is looking out at stage four and five and trying to see how we extend mine life north, east, and west of the existing pits.

11:36 And, really, there is absolute opportunity to do so. We've recently finished some geophysics in the area. We've mapped all of the illegal mining areas, and a lot of those areas are outside of the existing pit. So it does show that there is significant you know, there is gold, whether it's in economic form for a large scale mine versus a small scale miner. Something that's still yet to be determined. But given that the ore body hasn't really changed as we've gone north, we do believe that those opportunities will bear fruit in terms of extensions to the existing mine life. And that's part of what we're very much focused on this year. We have an exploration budget that's been approved by the board and by the lenders and that exploration has already started.

12:24 If we look at slide 18, you'll see that the geophysical survey, there is a just to show, this is the existing pit where my mouse is giving you an indication. And you can see down in this area the significant amount of exploration targets that you're seeing. See the old tunnels that were existing in the upper areas of the the mine. That is all of the targets for drilling, and we can also see over this side more tunnels even up to here where there's further tunnels up in this area as well. So there's significant east west profiles, where we haven't been able to drill in the past due to the illegal miners being in place. When now we've opened up, there's no illegal miners there anymore, and we can start those exploration activities outside the existing pit through extensions east and west and to the north as well. So if you see this, this is line this cross section here is in line c, section c, and you can see we've got exploration holes going far north of the existing pit, which is here. So that is, definitely opportune. There's still some illegal activities up here, so it does show that there's definitely gold up in this area. So that exploration activity pushing those pits further north is a key focus for us to extend the mine life.

13:47 And already, some of those drill holes at shallow depths are starting to bear fruit fruit where we're seeing definitely disseminated sulfides and and molys coming into the fractures in the stock works at very near surface, which is what we're after and what really this mine is based on. We haven't got any results back on those yet. And as we do, those things will be come back to the market, and we'll let you know how everything's going. But at this stage, we're seeing some some positive results in the the initial drilling at very shallow depth. And the benefit of this is we're not drilling hundreds of meters. We're drilling fifties, you know, 50 to a 100 meters, which is providing us with low cost exploration, and we can get a lot of drill holes and a lot of bang for our buck to to extend this mine life very cheap, and that's part of our focus right now.

14:39 Processing plan. As I've said, the processing plan has gone forward, with the the core team there, very much understanding, what, what is needed. We have now successfully understood and reconfigured BIOX, and BIOX production is exactly where we need it. There's still some of the technical issues that we have identified. There's still a little bit of work in, excuse me, in the plant to finalize the the reconfiguration, especially in the area of temperature control. But, generally, BIOX is in a position where it it is stable. It's producing where it should be against design, and our CI recoveries are reflecting the same. So, overall, we've got we've got a stable plant. We've got a stable BIOX circuit, and we've got a team that understands the technology that's required to to implement any changes that are required right now.

15:35 So I'm in a very good position with the the team we've got on-site. They're they're they're happy. We we've only got a small expat contingent. There's only 10 expats in the whole whole of the operation, and there's only three within that that process area. So, you know, that team with the the local team, which are now well trained, is doing a very good job in managing that plant and managing it going forward. So no real issues there, and, I look forward to, you know, the the production just remaining stable. I don't see any issues with that. We have, an amazing safety environmental record. There's a there is a large focus to be as part of our vision statement to be one of the most admired producers in The Philippines.

16:21 And with that, we recently achieved the safest mine, safest safest surface mining operation, safest overall mining operation, the best mine supervisor. We have had over the last five years, we've won the environmental reforestation award twice and been runner-up every other time or in the top three. We do have one of the best c I CSR programs in The Philippines, and I'm very proud of the work that the team are doing in this area as well. It has given us the opportunity to build relations and credibility within The Philippines, which gives us that opportunity to move business to the next stage of growth through m and a because people look at us as a credible source of development of operations.

17:09 And, therefore, they're coming to us with opportunities rather than us having to seek them out. So it has been, a very good strategy to maintain, and it always will be to maintain good relationships and build good community spirit and community well-being within the area of operations. With that, the you know, there's two structures to our CSR program. Our CSR program has a, a government, based structure where we pay into a government

17:36 fund, and that's all around infrastructure. So that's building roads, schools, municipal buildings. But our own internal, CSR program is more focused on people. We focus on communities, families, families affected, children at risk. We focus on then the development of the communities in the area of education, skills building, and management of families and family family well-being. And that's our focus, and it's really built a very credible future for us in the area of CSR. So we've got a very strong community. We're one of the only mining companies that don't have any protests in the country. And even at a a government level, we are recognized for the work that we do in both the environmental area and in the communities as as such.

18:28 So the only thing I haven't covered in this presentation, which I do wanna talk about, is our strategy going forward. It is mentioned in the first couple of slides, but just to talk through it, we are very focused on that near mine growth. And this year and next year, growing the mine and extending mine life by however many years may be available to us, we will be very focused on doing so. And what's the benefit of that? You know, we get one, two years extension to mine life. We've got seven years of mining. That gives us, that opens the door with, one, the cash flow that's generated by that, but, two, by the time frame that's generated by that to have an m and a strategy where we can grow the business through multiple minds.

19:16 And we have now the time frame when we will have the the opportunity through the board and through the lenders to start thinking of a bigger business, of a more structured business, not around a single operation, but around multiple operations. And quite frankly, that is our way to build shareholder value as we go forward. We have recently been looking at a number of m and a opportunities. We've presented those to the board. And, you know, fifteen, twenty opportunities, we funneled that down to four, which we're very focused on over the next twelve months to try and get one of those four up and running. And, hopefully, we can come back to the market in the in the near future within the next twelve months to show that the business has a future beyond run, Bruno. And that's our focus.

20:01 So I hope that gives you a good overview of everything that's been happening in the business. And I see that there's a couple of questions come up. Alessandro, I'll hand it back over to you. Darren, thank you very much for your presentation. Ladies and gentlemen, please do continue to submit your questions using the q and a tab situated in the top right hand corner of your screen. But just while Darren takes a few minutes to review those questions for today, I'd like to remind you that a recording of this presentation along with a copy of the slides and the published q and a can be accessed via your investor dashboard. Darren, we actually received a number of pre submitted questions from investors today, and I want to start off the q and a session with these. The first one reads as follows. I'm very interested to know how the new resource drilling is going both in pit and out. Yeah. So let let's start with in pit. We do a lot of in pit drilling. We we did last year. We've got a budget about $800,000 for our resource definition drilling. So everything in pit pretty well has come into reserve.

20:59 There's only a small amount of inferred that hasn't, and that will probably be drilled, if not this year, within the next twelve months. So the in pit, I the pit shell that's currently defined is well defined and well understood with quite good confidence of what's there. What that drilling has showed is that there's marginally lower grade to what was in the original models, but more tons. So the overall ounces are about the same, and that's why it's critical for us to maintain the high production through the process plant so we can keep the ounces up as, as that lower grade comes through. The out of pit drilling, which is seen as exploration drilling, requires lender approval to do so. And we've, finally, we've got some budgets now to do that this year, and that drilling as we we've talked about in the slides has actually started. And we're very confident given what we've seen in stage four and five for extensions to mine life. It is shallow drilling. We're talking 50 to a 100 meters.

21:56 We're doing some core and some RC drilling to to back that up, so we're keeping the cost as low as possible for the best bang for our buck. And even in the first hole and first two holes, we are seeing that there is some stock work and some disseminated sulfides, which will lead, hopefully, to some good gold results. The illegal miners have been there for, you know, a long time, and they they grew over that time. So it does show that there is something there, and, we're working hard to try and exploit that for ourselves now as we we go forward. So I see in the next twelve months, in the order of probably $500,000 of expenditure of ex exploration drilling, which should hopefully start adding to the resource, and then we'll do more definition around that to add to the reserve probably in the, next twenty four months.

22:43 That's great, Darren. The next question comes from an investor who asks, with the current debt arrangements, now you have shown the market that we can operate effectively. Are you looking at renegotiating the debt to a low percentage as currently we are profitable but not showing it as we pay high interest? Yeah. Thank you. As you know, Boris explained just in the presentation, what we're seeing is the the current structure of the the lenders' agreements is that by q four, the senior will be paid off and then the mezzanine debt will be restructured, and it is restructured down to that 7%. That's already within the agreement. So we will have, a a 7% ticket on our mezz debt by the end of this year, which is commercially quite a good quite a good number. We didn't have anything better than that in the previous loan agreements with our senior debt. So we feel that that that restructure that was previously done, while, you know, everybody would like to do better, I think we did very well to put the company on a profitable footing as mentioned, and we do not see or plan to do any more restructuring of that debt going forward as we sit.

23:58 That's great. Thank you. The next question relates to debt. What when do you anticipate the remaining debt being fully paid by? Yeah. As mentioned, the senior would be done by q four this year, then the METALS converts to senior. Given the current cash flows and current gold price, if that holds steady over the next three to four years, we see that, by 2025, we should have the debt, fully paid fully drawn down. Again, that could could move based on how much money we move from free cash to m and a. But if we do move free cash to m and a because the debt isn't as critical at a 7% ticket, then I feel that it would be well, know, well done for the shareholders to start spending money in that area so that the mine has and the business has that that extension to future. But at this stage, all things equal, we're looking at about 2025.

24:51 Thank you very much. Turning to the next question, which relates to ESG and ask what is your what is your ESG policy? Yeah. I think I've explained that. But, really, our focus is, as I said, twofold. There's, you know, there's a government program for infrastructure. We then have our own program in a community level for capacity building, children risk education, and families. On top of that, our environmental policy and environmental procedures has led us to be, best in country, you know, three out of the last five years two out of the last five years, you know, in the top three, five in the last five years every year. We only missed out by, like, 50 trees last year in terms of our tree, tree planting. We plant, over 2,000,000 trees,

25:44 both endemic and cash based crops for local farmers. So, you know, very strong performance in that area. You've seen our performance in safety, so we absolutely manage an operation that is world class. I don't believe there's too many other businesses that can show four years of LTI free with a workforce of over 1,200, more than 15,000,000 man hours without an incident. So, you know, the business is well in well managed from that point of view. The team are very strong. The team are very focused, and I believe our future is well in hand because of that. Thank you, Tyrone. That's great. The next question relates to COVID nineteen. And if you could provide us with a brief update on the situation in The Philippines, that'd be great.

26:35 Yeah. Look. The like every country, The Philippines has gone through all these waves of variants. However, our operation has been largely unaffected. You know, typically, the mining has has maintained, you know, continuous operations. As I said, in the first few months of the pandemic, we did see some some issues with the national grid. But, since then, it's been, quite strong. It's been reliable. And, while logistics and inflationary issues across the world are affecting all costs in, the mining sphere and probably every area of business. Generally, our operation has maintained steady production, and the results reflect that. Thank you very much. The next question reads as follows.

27:22 Can you update us on the situation in The Philippines, and how is mining viewed? Yeah. Again, I talked through this in the presentation, but, clearly, there's, a strong government push for, mining to base to be, part of the economy going forward. Previously, there were some issues around the the government and they'd shut down open cut mining or what they called open cut mining. We're one of the only mines that were approved back back when this was happening. And it had been a real issue for The Philippines and investment because of what was happening within the government. However, that has changed. They last year, they did come out with a statement, and they did remove any of the bans against open pit mining. They have been very strong in their rhetoric around mining as a base for the economy, and the new elect the the upcoming presidential elections show a a propensity for the major candidates to be pro mining. So I feel that there's a there's a real opportunity for an existing miner with the right team in country to take take advantage of this opportunity.

28:33 Thank you very much. I know you might have touched on this in the presentation, but what is your focus for the year ahead? Yeah. Again, parallel focus is on exploration and m and a. Not much more to say about that consolidation of existing operations, maintaining cash flow to draw down the debt. Thank you. The next question is about new projects. What about new projects? What are you looking for, and have you identified any yet? Yeah. As mentioned, we probably got we just the board meeting a couple of days ago, I got approval to look at the four separate projects, m and a projects within the country, and we are moving forward to start engagement on those projects. And as everybody knows with m and a, it's a it's a fickle beast. You don't know how you're going to go, and you don't know if the two management teams and the two businesses can come together, but we will be working hard to find the right business for us. We have a very specific focus, you know, where we are generating free cash. We are a company that has some opportunity to to invest money within this fear.

29:35 However, we're not we're not looking to look at opportunities that are large scale beyond our means. So we have a very specific target set. We're funneling to that target set high grade, low volume, low CapEx type operations, which generate maximum value in terms of margins. And that's our focus as we go forward. And there's enough businesses in The Philippines that are underdeveloped that can we can assist with in this fee. Thank you very much, Tara. And the next question reads as follows. What's your exploration plans for the year ahead? Yeah. As mentioned, we're focused on east, west, and north of, stage, four and five. We've got a budget to somewhere around the $500,000 mark to to spend on doing that work, and that's that's our focus for the next year. And, hopefully, by the end of this year, we'll be able to come back with some some, you know, strong information around those extensions to the resource and the year after to the reserve as we go forward.

30:34 The bi the BIOX plant has historically been problematic. What changes have you made to ensure you hit nameplate? Yeah. Look. It has been an interesting journey with BIOX. It it is variable in trying to maintain stability, especially on a a power grid that we're at the end of the line. But we understand the technology now. We understand the team has a very good handle on the issues that result in values and BIOX and performance. We understand what we've made a lot of changes to maintain stability, increase airflow, increase agitation, the nutrient feed across the board. The last outstanding bastion to finalize our changes to the technology is stability around temperature control, and we're working on that this year.

31:24 Right now at 50 tons sulfur a day, the plant's designed for seventy and fifty tons sulfur a day, We easily maintain the 92%, performance in BOX, 92% oxidation, which gives us a 95 CO recovery, and, that's basically design. And, with the stable temperature control as we go forward, we'll be able to push that to the 70 tons, which is the full nameplate design of that bioc circuit. So very happy with the team and very happy with the performance of biocs. Thank you, Darren. Thank you for providing a bit more color there. Next question is from an investor who asks, what is your planned CapEx for the year ahead, and what would this be spent on? Yeah. So it's maintenance of equipment is one key area. The mine mobile equipment, a lot that's coming up for rebuild. And really the other other major area of investment is the, RSI, which is a residual, storage impairment.

32:19 That needs, the last lift to take it to full height, will be done this year. And, beyond that is the final spillway design, and then next year is starting construction at the final in Rock Spillway. So they're the two major areas of, investment and capital for for the year. That takes a spillway sorry. That takes our RSI to final stage, so there's no, no further lifts required. The the impairment will have enough capacity to meet mine life. And, the final spillway position gives that's that's really a closure plan and a requirement for the long term stability that of that dam as as we move out to beyond mine life and and into closure. That's where we're focused. Thank you very much. Turning to the next question which asks, when do you think you will have paid out the senior term loan?

33:10 Yeah. I think we mentioned this quarter four. Perfect. And the final presubmitted question is can you continue to maintain these levels of record results in terms of gold sold, gold sale proceeds, and gold recoveries? Look. The one thing we don't have a cut control over is gold price. However, from a production point of view, absolutely. The business is stable. The operations are stable. We have a very good handle on the long term design of the mine and the scheduling. We understand the business and the ore body significantly better than we did three years ago. So production wise, I I believe that it's a it's a very stable operation now and maintaining that going forward is not going to be a significant issue. Gold price, hopefully, we see 2,100 and everybody gets very happy.

33:59 But, again, that's something we can't forecast, and we don't we don't have much of a crystal ball around that given the variability we have seen even the last couple of years in that market. Thank you very much, Dan. That concludes the presubmitted questions. As you can see, we've received a number questions throughout today's presentation as well. And thank you to all the investors for submitting their questions. Could I ask you to open up the q and a tab, read out the questions, and give the response to where it's appropriate for you to do so. And then I'll pick up from you at the end. Okay. Thank you, Alessandro. I'll go through the first question. I've got the CFO sitting here, and so if I if I miss something, he can help me out. But the first question from Nathan p is around why haven't we refinanced. There's two issues, two sides to that. I'll I'll answer the first part of the question, Nathan, first, and then I'll move on to the second. We haven't refinanced because, we really we have no control over that.

34:52 The the lenders are the ones who can stop or start that that process. We need their agreement to to make changes. So firstly, foremost, we haven't got the the approval to refinance. Also, the the structure of the documents would be difficult for us to get anyone else to come into. They have supported the company in terms of how we go forward and making the company a stable business with a stable balance sheet. Those, those lender documents, because we were able to negotiate, the through the the agreements because it's held

35:27 by the, the major shareholders, it gave us a lot of flexibility in how that was to be paid down and how that would make the company stable going forward. The fact of the matter is by, quarter four this year, we will then have a ticket at 7%, which is very commercially viable in the international sphere for a fill Filipino based business. So I don't see any real opportunity or any real change that is required in those documents for refinance. Look. We did look at options around equity raises to bring the senior debt quicker. There was a whole range of things we did look at but won't move forward due to, you know, the the things that I've just discussed. We did pay about 40,000,000 of repayments, but because of the 15% ticket on the the METALS, it's basically that growing interest rate, which is capitalized on the METALS until become senior that has, mean that the net debt payment is only 21,000,000 for the year. So it is absolutely critical and a priority for this business to get the mezz down to that 7% ticket so that growth in the capital in that business, in that loan can come down significantly, and that's where the focus is.

36:36 David r, at least 50% of the revenue will be taken by taxes. What action have you taste to reduce this heavy tax burden? Look. The the company is looking at all options and all, opportunities to reduce, under the the structures of international tax rules on both local and, London to find, you know, not solutions, but to find optimizations around, around that tax position. We have, found some opportunities, we believe, that will so supported by the the international tax rules, and they would move forward. So I while the tax structure sits there, it's and it is an impost on the business. Everybody pays taxes, and it's something that we need to do to maintain ourselves as a, you know, a a good commercial and a good good company within the country. But at this stage, we will use what what laws exist both in The Philippines and in London to to optimize that situation.

37:38 Mike, anything else you'd say around that? Well, we do have a tax holiday through until halfway through this year, and we have made an application to extend that tax holiday. So that application is with the Filipino government. It's it's perhaps less than fifty fifty chance that it will be extended, but we have had a five year tax holiday already. So the the life of mine tax burden is is is less than 50%. So the the overall tax structure in The Philippines was was quite competitive. But as Darren said, we are looking at any possible tweaks to our structures that that will minimize that future tax leakage.

38:25 Yeah. So, Steve and I I hope that answers your question too because I believe that that covers both those questions. And, James Jay, would it technique would it be technical possible to configure the backup power supply in such a way that it kicks in almost immediately? We do. That's exactly how it's configured, and it's exactly what it does. But that doesn't mean you still don't have failures in the overall system. But even if it does kick up immediately, just from a to give you a technical issue, the blowers, provide the air to BIOX, they have to ramp down because of the way the the turbines work in those blowers before they can ramp back up. So even with the backup power kicking in immediately within seconds, you've still got a fifteen minute delay. Okay? Then fifteen minutes in box is a long time. So while we have set up a system where it does do that, what we also have done is some of the cabling that was in the initial construction was faulty. We've replaced all that. We've got and now since since 2020, we have not had a failure that has impacted the circuit at all.

39:31 So some of the changes we've made since we started to see those failures when the line was going down are now are now not in place. Just to give you an idea, though, we are in a we are in a jungle. And the the last time we had a failure, we had a rat run under the breaker, we fricasied a rat, and the backup power didn't come on. So just to give you an idea of some of the impossibilities that actually happened, and someone laughed at me and said, gotta be joking. I said, no. Can show you a fricasseed rat. It was funny. You know, the the photo of the rat sitting on a break was quite funny. So, it does happen. You do have those failures. It's not impossible, but our reliability now is up around the 99, 99.9%. We're we're very good, and we've got a very stable system. So I think that's pretty well under control now, James. Steven O. Is the company's strategy to pay down the debt? Yeah. Okay. I think we've answered that question. I don't think I need to go into the the debt issue, again.

40:22 James m, how proactive had the Philippine government been with the removal of the illegal miners? Look. It took us, James, very much. They've been very active. It took us three years to build the relations we needed to get the government on-site to start moving this and to an extent the business coming up against the wall with regards to the illegal miners. We started when we started in 2019, 2020, we had 830 illegal occupations, not just people. There are probably 1,500 to 2,000 people. That's down to two. And that wasn't just us. That was a proactive input by all of the government agencies, and it was a government problem because it's not our issue that they exist.

41:08 Those illegal mines are actually against government regulations. So the working with the government, we got we got buy in from all of the federal areas, including the, the mines department, the police, the, the military supporting on the side, and the, Federal Bureau of Investigations, which is called the MBI. And across those fears, we were able to peacefully with with structured structured compensation and basically remove all of those miners. And as I we're down to two, I think, was the last time I looked. So that is now very well under control. We have full access to our areas, and, we're moving forward in that drilling that wasn't available to be done prior to now. David r, how much of an impact on cash generation will the tax have?

41:57 Again, David, we're as we we've talked about, I think this question's been answered. We're looking at structures and optimizations, going forward to, to manage that situation as best as we can. Nathan p. No dividend likely for a very long time. No. Our share price won't be based on dividend. We've first gotta grow the company. And once we grow the company, I think we'd much rather see a strong share price, a strong, a strong company with a a longer term future, which gives you value in your share, which you haven't seen for a long time. Let's be clear. When we took this company over, it was it was heading towards a liquidate a liquidity issue. It doesn't have that now. It has strong cash flows. It has positive outcome, and we have a positive future.

42:45 Look to share price, and then hopefully in the next twelve months, we can come up with some positive information to show that that's going to happen. And then once the company is on a stronger footing, we have come brought our debt down, we have grown the business, then we can start looking at, looking at dividends. But at this stage, I'm not likely or we're not likely to see dividends rather rather we're likely to see growth, and that's what we're focused on. You mentioned other potential projects, James m. You mentioned other potential projects which had been narrowed down to four. Are these within FCF current permitted, exploration areas or outside? We're we're trying to focus, James, close to mine. We're definitely focused on Luzon, which is the island we're on, but, no, they're not in the existing FTAA.

43:30 The existing FTAA is 4,000 hectares. You'd sit there and say, well, there's enough area to explore, but it's absolute greenfield. There's not one drill hole. There's not one survey. There's not one area of mapping, that has a potential that we see that we can get through areas which have already been, resource, verified, resource drilled, brownfields. And so to get something into the business and up and running as quickly as possible, our money is best spent on m and a outside of the existing area. It would take us ten to fifteen years to develop a resource within the 4,000 hectares if we found one. But going to known resources at the right value for the right niche market that we're looking for, that's our focus. And we'll get better bang for our buck doing that. And that's why the board and myself feel that the strategy is m and a and, growth outside rather than organic, within the existing FTAA.

44:29 Rupert p, given your ambitions for m and a and the need for cash, could this defer the date of the, maiden dividend? Again, back to the dividend question, strong growth rather than dividends. The only thing we won't defer is paying down the senior. The the thing we need to do is prioritize small amounts of cash this year if we're going to do some in m and a, get the senior down, get the mezz converted, and then start looking at freeing up some cash at a lower, a lower interest ticket going forward on the, on the senior, which was METALS after q four. So, yeah, m and a is ambitious, but I think, it's necessary if we want this business to have a strong shareholder value, and the future, and that's where we'll be focused. James m, I'd like to thank you for, turning both mine and the company, since your appointment. Fantastic job. Thank you, James.

45:22 I love the feedback, and, it's good to be positive. Into a world class mine, everything following yeah. Look. It it is. It it's still a small mine. It still hasn't the mine life I'd love to see. That's why we need to get that. So, James, I wanna bring value to you as a shareholder. I wanna bring value to this company. And, now we've got a board that's independent. We've got a board that's focused on the same area that I am, which is a bigger business and a better business for all the shareholders. I think the opportunity exists to do so. So, James, if you bear with me, you bear with the company, and you're probably stuck at a rate. You've probably been around for a while and stuck with us. Yeah. Well, give us a little bit more. I think we, I think we can show real value for you guys as we go forward, and we're looking forward to doing so. James j, would a consolidation help the share price? It's an interesting question.

46:11 We've had it over a number of, discussions in the last few days, alone. At this stage, I believe the answer is no. I I don't see consolidation doing much for us. There's if you look at consolidations across the world, normally, you see a consolidation and a drop in the consolidated share price as an instant drop once that consolidation happens. So I think you'd look at a a reduced capital value or market value for the business if you did so. I don't think there's any real need. I I don't like, you know, a share at the current pricing we've got it. But, again, I would prefer that than at this stage with all the discussions in the advisory committees we've we've had through the technical working groups of consolidation as being the best option. So we're gonna maintain the the the share rating where it is.

47:02 In the future, that might change. In future, if we have very strong business. We have, you know, multiple projects coming on our books, we are looking at an equity raise. Maybe there's an opportunity to do so. But right now, that's not on our purview, and it's not in our agenda. Last question is Chris s. I agree with you, and the team have done a great job. But why is the guidance this year lower than last year? Pure and simply head grade. We have focused on marginally higher recoveries this year to try and achieve an offset to head grade, but, the head grade, is driving guidance, not production, not performance. We are seeing there is a lull for 2022, maybe into 2023 of head grade, but we do see that come back once we get down into the ore body in stage four and three and four where the head grade will come back up. So end of twenty or mid twenty twenty three, 2024, we'll see bumper years where we'll have production over guidance or well over guidance.

48:05 But at this stage for 2022, the issue is the the head grade, Chris. So that's, that's basically what we're we're managing. So thank you, everyone. It's, been great. I know this is only, the second one we've done, and, you know, the the team here at Teva stock being great helping us manage this. We will be, working to probably do this, if not once a year, once every six months to try and give you an update because I think now we're in a stable position. Now we're actually doing you know, generating value within the business and move trying to move the business to a a a more value generative platform. I think these type of opportunities to have these discussions with with all the shareholders and with any potential investors is beneficial and productive. So thank you for your time, and thank you for the questions. Alessandro?

48:53 You very much, Darren. I think you actually managed to address every question from investors. And of course, if any further questions come through, the company will review those questions submitted, and we'll publish those responses on the investment company platform. Just before redirecting investors to provide you with their feedback, which I know is particularly important to the company, could I ask you for a few closing comments? Yeah. Look. I I think, as I've said, most of our shareholders, even retail, are long term. I appreciate it. I appreciate your efforts and, sticking with us. We are hoping to generate value in the near term for you through, our exploration activities and our m and a. I look forward to coming back with positive news over the next twelve months, and I look forward to, you know, seeing James j and James m and, everybody else who was on this webinar again and, being able to give you even more positive feedback. So the company, I believe, now has a future. We have a strong management team. We have in country experience. We got boots on the ground to do the job that's needed to make this company something into the future. I look forward to it.

49:56 I look forward to talking to you again. Thank you. Darren, thanks again for updating investors today. Could I please ask investors not to close the session as you'll now be redirected to provide your feedback in order that the management team can better understand your views and expectations? This will only take a few moments to complete, and I'm sure be greatly valued by the company. On behalf of the management team of METALS EXPLORATION PLC, we'd like to thank you for attending today's presentation. Good morning to you all.