Q2 2024 Sigma Lithium Corp Earnings Call

August 16, 2024

Regina: Earnings Conference Call. Today's call is being recorded and is broadcast live on Sigma's website. On the call today is Company CEO, Ana Cabral, and Company Executive Vice President, Matthew DeYoe. We will now turn the call over to Matthew DeYoe. Thank you, Regina. And good morning, everyone.

Unknown Executive: for Earnings Conference Call. Today's call is being recorded and is broadcast live on Sigma's website.

Courted and is broadcast live on the website on the call today is the company's CEO, Anna Cabral and company Executive Vice President Matthew D. O. We will now turn the call over to Matthew D. L.

Unknown Executive: On the call today is company CEO Ana Cabral and company Executive Vice President Matthew DeYoe.

Matthew DeYoe: We will now turn the call over to Matthew DeYoe.

Matthew DeYoe: Thank you, Regina, and good morning, everyone. Thank you for joining us for our second quarter 2024 earnings conference call. As Regina noted on the call with me today, is company CEO and co-chairperson Ana Cabral. After the market closed yesterday, we published our two two financials, which are available both through SEC and Cedar.

Speaker Change: Thank you Regina and good morning, everyone.

Matthew DeYoe: Thank you for joining us for our second quarter 2024 earnings conference call. As Regina noted, on the call with me today is company CEO and co-chairperson, Ana Cabral. After the market closed yesterday, we published our 2Q financials, which are available both through SEC and CDER. Before we begin, I'd like to cover two items. First, during the presentation, you will hear certain forward-looking statements concerning our plans and expectations. We note that actual events or results could differ materially from the changes in market conditions in our operations.

Speaker Change: Thank you for joining us for our second quarter 2024 earnings Conference call as Virginia noted on the call with me today as the company's CEO and co chairperson and Cabral.

Speaker Change: After the market closed yesterday, we published our Q2 financials.

Speaker Change: If you're available both through sense Peter.

Matthew DeYoe: Before we begin, I'd like to cover two items. First, during the presentation, you will hear certain forward-looking statements concerning our plans and expectations. We note that actual events or results could differ materially from the changes in market conditions in our operations. Additionally, earnings reference in this presentation may exclude certain non-core and non-repairing items. Reconciliation to the most comparable IFRS financial measures and other associated disclosures, including the descriptions of adjustments, can be found in the back of the press release.

Before we begin I'd like to cover two items.

Speaker Change: Okay.

Speaker Change: Oh.

Speaker Change: First during the presentation, you will hear certain forward looking statements concerning our plans and expectations. We note that actual events or results could differ materially from the changes in market conditions in our operations and Additionally earnings referenced in this state purchased presentation, alright that exclude certain noncore and nonrecurring.

Speaker Change: Items reconciliations to the most comparable <unk> financial measures and other associated disclosures, including the descriptions of adjustments can be found in the back of the press release with that I will pass it over to al.

Matthew DeYoe: And additionally, earnings referenced in this presentation may exclude certain non-core and non-recurring items. Reconciliations to the most comparable IFRS financial measures and other associated disclosures, including the descriptions of adjustments, can be found in the back of the press release. With that, I will pass it over to, Hi, good morning, everyone.

Matthew DeYoe: With that, I will pass it over to Ana.

Ana Cabral: Hi, good morning everyone. I am very, very pleased to present to you with our second quarter of 2024 quarterly result. We are actually delighted that we have managed to achieve all around operational actions, thriving in our financial results despite what it is a liquid price environment that just do not control.

Ana Cabral: I am very, very pleased to present to you with our second quarter of 2024 quarterly results. We are actually Delighted that we have managed to achieve all-around operational excellence thriving in our financial results despite what it is a lithium price environment that we just do not control. So what we're going to show in these results is that we have what we control all of our operational elements fully managed and actually demonstrating our operational excellence.

Speaker Change: Hi, Good morning, everyone I am very very pleased to present, you with our second quarter was 2024.

Speaker Change: Quarterly results were actually up.

Speaker Change:

Speaker Change: Delighted that we have managed to achieve all around operational excellence driving in our financial results.

Speaker Change: Results. Despite what it is a bitumen price environment. They will just do not control.

Ana Cabral: So what we are going to show in these results is that we have what we can show all of our operational elements fully managed and actually demonstrating our operational axles. So starting with the volumes, we have heard of increased the cadence of volume, so to 22,000 tons of material shipped every 30 to 35 days. So that means we have achieved what we call reliability as a producer, which is linked to our ability to receive favorable rates and favorable turns in export-linked credit. Meaning credit lines linked to our ability to continue to maintain this export track record.

Speaker Change: So what we're gonna showing these results is that we have well we control all of our operational elements are fully manage and actually demonstrating our operational excellence. So.

Ana Cabral: So, Starting with the volume, we further increase the cadence of volume sold to 22,000 tons of material shipped every 30 to 35 days. So that means we have achieved what we call reliability as a producer, which is linked to our ability to receive favorable rates and favorable terms in export-linked credit, meaning credit lines linked to our ability to continue to maintain this export track record. Another very important point in delivering our strategy was the ability to continue to increase the sales price premium relative to our competitors.

Speaker Change: And with the volume we further increase the cadence of volume so choose 22000 tonnes of material shift every 30 to 35 days. So that means we have achieved.

Speaker Change: She is what we call reliability as a producer which is linked to our ability to receive favorable rates and favorable terms and export linked credit meaning credit lines.

Speaker Change: Linked to our ability to continue to maintain this export track records.

Ana Cabral: Another very important point in delivering our strategy was the ability to continue to increase the sales price range relative to our competitors. That's a key element of our strategy, and it's a result of increased commercial assertive. So as we deliver cadence of volumes and as we are rewarded by the banking system with a more favorable credit link to the export financing, we are able to continue to push, continue to exercise commercial assertiveness and therefore achieve a sales price range. So these elements are all interlinked: performance of favorable credit lines and then price premium performance. On the cross-front, on the operational front, we are just delighted to have been able to print when the highest cash margins in the sector, especially when this happened against the quarterly where the backdrop of top line resulting from Lithium prices wasn't again something we control but wasn't as favorable.

Speaker Change: Another very important point in delivering our strategy was the ability to continue to increase the sales price green relative to our competitors. That's a key element of our strategy and it is a result of increased commercial story.

Ana Cabral: That's a key element of our strategy and it's a result of increased commercial assertiveness. So as we deliver cadence of volumes and as we are rewarded by the banking system with a more favorable credit link to the export financing, we are able to continue to push, continue to exercise commercial assertiveness and therefore achieve a sales price premium. So these elements are all interlinked.

Speaker Change: So as we delivered cadence of volumes and as we are rewarded by the banking system with.

Speaker Change: A more favorable.

Speaker Change: Credit linked to the export financing, we are able to continue to push.

Speaker Change: We continue to exercise commercial intuitiveness, and therefore achieve a sales price.

Speaker Change: So these elements are all interlinked performance.

Ana Cabral: Performance, favorable credit lines, and then price premium performance. On the cost front, on the operational front, we are just delighted to have been able to print one of the highest cash margins in the sector, especially when this happened against the quarterly where the backdrop of top lines resulting from lithium prices wasn't, again, something we controlled, but wasn't as favorable. So it means that by posting this cash margin, we do have our cost structure well under control.

Speaker Change: Favorable credit lines, and then price premium performance.

Speaker Change: On the cost front on the operational front. We are just delighted to have been able to print a one of the highest cash margins in the sector, especially when this happened against a quarterly where the backdrop of topline, resulting from lithium prices wasn't.

Speaker Change: Again, something we control, but it wasn't as favorable so we even need thereby boosting this cash margins, we do have our cost structure, well under control and of that I mean.

Ana Cabral: So it means that by posting this cash margins, we do have our cost structure well as a control. And at that, I mean, again, we're very proud of having reached our cost target for 2024. I have a schedule, meaning we're now, we continue to be amongst the lowest in the sector and we manage to print every cost target that we indicated to investors early in the year 20, 2022, and we're just in a second quarter, which just shows the direction of this trajectory.

Ana Cabral: And at that, I mean, again, we're very proud of having reached our cost target for 2024 ahead of schedule, meaning we're now, we continue to be amongst the lowest in the sector, and we managed to print every cost target that we indicated to investors early in the year, for the year 2022, and we're just in the second quarter, which just shows, you know, the direction of this trajectory. We do believe that this is the result of a bottom-up, top-down culture, so it would be impossible to achieve all these metrics if we hadn't implemented what we call a culture of excellence and high standards amongst our employees, and that starts with a clean metric that's highly beneficial to them, which is safety.

Speaker Change: Again, we're very proud of having reached a cost target for 'twenty 'twenty four I had them schedule, meaning we're now we continue to be amongst the lowest in the sector and we manage to print every cost argued that we indicated to investors early in Europe for the year of 2022, and we're just in the.

Speaker Change: Second quarter, which just shows the direction of this trajectory.

Ana Cabral: We do believe that this is the result of a bottom-up, top-down culture, so it would be impossible to achieve all these metrics if we hadn't implemented what we call a cultural excellence in high standards amongst our employees. And that starts with a key metric that's highly beneficial to them, which is safety. Again, we're very proud of having completed the full year with no fatalities, zero fatalities, and zero accidents without loss of worth, which means we sent our people back to their families safe. It would be doing that for an entire year, which is an incredible achievement for a young operation.

Speaker Change: We do believe that this is the result of a bottom up top down cultures. So it would be impossible to achieve all these metrics. If we hadn't implemented what we call a culture of excellence and high standards amongst our employees and that starts with a clean metric that's highly beneficial to them.

Speaker Change: Which is safety again, we're very proud of having completed the full year with no fatalities zero fatalities and zero accidents without lots of war, which means we send people back to their families safe it'll be doing Denver, an entire year, which is a new.

Ana Cabral: Again, we're very proud of having completed the full year with no fatalities, zero fatalities, and zero accidents without loss of work, which means we send our people back to their families safe, and we've been doing that for an entire year, which is an incredible achievement for a young operation, that has catapulted us to the very top of the metals and mining industry rankings as measured by ICMM, the International Council of Metals and Mining Companies. There's just one company that ranks above us on these combined rates.

for Earnings Conference Call. Today's call is being recorded and is broadcast live on Sigma's website. On the call today is company CEO Ana Cabral and company Executive Vice President Matthew DeYoe.

Unknown Executive: for Earnings Conference Call. Today's call is being recorded and is broadcast live on Sigma's website. On the call today is company CEO Ana Cabral and company Executive Vice President Matthew DeYoe. We will now turn the call over to Matthew DeYoe. Thank you Regina, and good morning everyone. Thank you for joining us for our second quarter 2024 Earnings Conference call. As Regina noted on the call with me today is company CEO and co-chairperson Ana Cabral.

We will now turn the call over to Matthew DeYoe.

Speaker Change: Incredible achievement for a young operation.

Matthew Porter DeYoe: Thank you Regina, and good morning everyone.

Ana Cabral: That has catapulted us to the very top of the metals and mining industry rankings as measured by ICMM, the International Council of Metals and Mining companies. There's just one company that ranks above us on these combined ratings.

Speaker Change: That has got the bulker does to the very top of the metals and mining industry ranking as measured by Ikea Ma'am the international Council of metals and mining companies Theres, just one company that ranked above us all these combined wage H.

Speaker Change: Thank you for joining us for our second quarter 2024 Earnings Conference call.

Speaker Change: As Regina noted on the call with me today is company CEO and co-chairperson Ana Cabral.

Speaker Change: After the market closed yesterday we published our two two financials which are available both through SEC and Cedar.

Unknown Executive: After the market closed yesterday we published our two two financials which are available both through SEC and Cedar. Before we begin I'd like to cover two items. First, during the presentation you will hear certain forward-looking statements concerning our plans and expectations. We note that actual events or results could differ materially from the changes in market conditions in our operations.

Ana Cabral: It's a complete stir to the next page, so I think the summary of where we are is, again, we were able to combine three attributes. They're quite unique and not easily combinable in our industry. We initiated our shipment last year in operating in large scale. We have been maintaining low production costs consistently, and we have been delivering the most sustainable lithium in the world. Our lithium became a brand for all attributes related to sustainability and traceability. Not one company in our space has been able to deliver what was called the trinity of metal producers since 2018 when our dear Buvara initiated their operation.

Ana Cabral: If you could please turn to the next page, so I think the summary of where we are is, again, we were able to combine, three attributes, they're quite unique and not easily combinable in our industry. We initiated our shipments last year in operating in large scale. We have been maintaining low production costs consistently. And we have been delivering the most sustainable lithium in the world. Our became a brand for all attributes related to sustainability and traceability.

Speaker Change: If you could please turn to the next page. So I think the summary of where we are is again, we were able to combine them.

Speaker Change: Before we begin I'd like to cover two items.

Speaker Change: Three attributes that are quite unique and not easily combinable in our industry we need.

We initiated our shipments last year in operating in large scale, we have been maintaining low production cost consistently.

Matthew DeYoe: Additionally Earnings reference in this presentation may exclude certain non-core and non-repairing items. Reconciliation to the most comparable IFRS financial measures and other associated disclosures including the descriptions of adjustments can be found in the back of the press release.

Speaker Change: And we have been delivering the most sustainable lithium in the world are alleging became a brand for all attributes related to sustainability and traceability.

Ana Cabral: With that I will pass it over to Ana.

Speaker Change: No one company in our space has April has been able to deliver what was called the Trinity of metal producers since 2018, when our Deerfield Barbara initiated their operations. So.

Speaker Change: First, during the presentation you will hear certain forward-looking statements concerning our plans and expectations.

Ana Cabral: Hi, good morning everyone. I am very very pleased to present to you with our second quarter of 2024 quarterly result. We are actually delighted that we have managed to achieve all around operational actions, thriving in our financial results despite what it is a liquid price environment that just do not control.

Speaker Change: We note that actual events or results could differ materially from the changes in market conditions in our operations.

Ana Cabral: Not one company in our space has been able to deliver what we call the trinity of metal producers since 2018 when our dear Biobara initiated their operations. So 60 years have passed, billions of dollars have been invested in the lithium industry, quite a lot of hype, a massive cycle, but not one company has been able to deliver the trinity that we actually have delivered, which demonstrates how rare an achievement this is.

Ana Cabral: So six years have passed. Bill is a dollar to be invested in the lithium industry, quite a lot of hype. A massive cycle, but not one company has been able to deliver the trinity that we actually have delivered, which demonstrates how rare an achievement this is.

Speaker Change: Three years have passed.

Speaker Change: Billions of dollars are being invested in the lithium the industry quite a lot of hype a massive size.

Speaker Change: But no one company has been able to deliver the Trinity that we actually have deliberate which demonstrates how rare achievement. This is.

Speaker Change: Additionally Earnings reference in this presentation may exclude certain non-core and non-repairing items. Reconciliation to the most comparable IFRS financial measures and other associated disclosures including the descriptions of adjustments can be found in the back of the press release.

Ana Cabral: So what we are going to show in these results is that we have what we can show all of our operational elements fully managed and actually demonstrating our operational axles. So starting with the volumes, we have heard of increased the cadence of volume so to 22,000 tons of material shipped every 30 to 35 days. So that means we have achieved what we call reliability as a producer which is linked to our ability to receive favorable rates and favorable turns in export linked credit.

Ana Cabral: On the next page then, I will encourage you to look at our operational highlights. And again, I'm going to start with this slide where we implement the disclosure of excellence in high standards, which drive our entire performance and it's been driving our entire performance throughout 2024. We're very, very proud to present this slide because, in the narrow quantification of our ability to operate our block of the city, the industrial mining facilities adhere to the highest operational standards. We were able to survive in the ITMM ranking, dozens of much larger and much more mature method of mining company producers, just demonstrating that we had to quickly rise in the occasion during our first year, meaning we didn't have a break and no slack was cut for us.

Ana Cabral: On the next page, then, I would encourage you to look at our operational highlights. And again, I'm going to start with the slide where we implemented this culture of excellence and high standards, which drive our entire performance and has been driving our entire performance throughout 2024. We're very, very proud to present this slide because the numeric quantification of our ability to operate our industrial mining facilities, adhering to the highest operational standards.

Speaker Change: On the next page then.

Speaker Change: Encourage you to look at our operational highlights and again I'm going to start with the slide where we implemented this culture of excellence and high standards, which drive our entire performance and it is being driven driving yarn thought performance throughout 2024, we're very very proud to present this slide because they're new.

Speaker Change: With that I will pass it over to Ana.

Ana Cabral: Hi, good morning everyone.

Speaker Change: Mary quantification of our ability to operate a drop in the city of industrial and mining facilities during the highest operational standards.

Speaker Change: I am very very pleased to present to you with our second quarter of 2024 quarterly result.

Ana Cabral: Meaning credit lines linked to our ability to continue to maintain this export track record. Another very important point in delivering our strategy was the ability to continue to increase the sales price range relative to our competitors. That's a key element of our strategy and it's a result of increased commercial assertive. So as we deliver cadence of volumes and as we are rewarded by the banking system with a more favorable credit link to the export financing, we are able to continue to push, continue to exercise commercial assertiveness and therefore achieve a sales price range.

Speaker Change: We were able to surpass easy ice T M M ranking.

Speaker Change: Those of much larger and much more mature metals and mining company producers just demonstrating that we had to quickly rise to the occasion during our first year, meaning we didn't have a break and no slack was cut for US essentially we had to trade out of the gate behaves.

Ana Cabral: We are actually delighted that we have managed to achieve all around operational actions, thriving in our financial results despite what it is a liquid price environment that just do not control.

Ana Cabral: We were able to surpass in the ICMM ranking dozens of much larger and much more mature metals and mining company producers, just demonstrating that we had to quickly rise to the occasion during our first year, meaning we didn't have a break and no slack was cut for us. Essentially, we had to straight out of the gate, behave like a seasoned producer, commission like a seasoned producer, and ramp up like a seasoned producer.

Ana Cabral: Essentially, we had to straight out of the gate, behave like a season producer, commission like a season producer, and ramp up like a season producer.

Speaker Change: Like a season producer commission like his children producer and ramp up like the season producer. There are several operational milestones that we will be showing here today, which are actually rarely achieved by our company. This just one year old and the rankings you see here.

Ana Cabral: There are several operational milestones that we will be showing here today, which are actually rarely achieved by a company that's just one year old, and the rankings you see here are just one of these. The next page talks about our cadence of volume shift, which, again, we were able to establish that reliable cadence of product sales, which are a hallmark of the operational maturity of a seasoned producer. We have sold 52,500 tons of our quintuple zero green lithium concentrate, both in the first and the second quarter, which means we're able to manage the cadence and reliability of our shipments.

Ana Cabral: There are several operational milestones that we will be showing here today, which are actually rarely achieved by a company that's just one year old, and the rankings you see here are just one of these. The next page talks about our cadence of volume shift, which again, we were able to establish that reliable cadence of product sales, which our homework of the operational maturity of a season producer. We have sold 52,000 five of the tons of our typical zero green lithium concentrate, both in the first and second quarter, which means we're able to manage the cadence and reliability of our shipments.

Speaker Change: Just one of these the next stage.

Speaker Change: Talks about our cadence of volumes shipped.

Speaker Change: Which again, we were able to establish that reliable cadence of product sales, which which are a hallmark of the operational maturity of excuses producer. We have sold 52500 tonnes of our tentacles zero green lithium concentrate up both in the first and second quarter.

Ana Cabral: So these elements are all interlinked, performance of favorable credit lines and then price premium performance. On the cross-front, on the operational front, we are just delighted to have been able to print when the highest cash margins in the sector, especially when this happened against the quarterly where the backdrop of top line resulting from Lithium prices wasn't again something we control but wasn't as favorable. So it means that by posting this cash margins, we do have our cost structure well as a control.

Speaker Change: Which means we're able to manage the cadence and reliability of our shipments up that's possible because of our enhanced credit worthiness at the end of the first quarter. So we were able to conduct what we call F O b sales at warehouse, which again.

Ana Cabral: That was possible because of our enhanced credit worthiness at the end of the first quarter. We were able to conduct what we call FLB sales at warehouse, which again, are a whole mark of trustworthiness and reliability between Sigma and its clients, when we transfer ownership of material at board to its final client before we board the ship, which again is another operational milestone rarely achieved by a company that's just one year old.

Ana Cabral: That was possible because of our enhanced credit worthiness at the end of the first quarter. So we were able to conduct what we call FOB sales at warehouse, which again are a hallmark of trustworthiness and reliability between Sigma and its clients when we transfer ownership of material at port to its final client before it boards the ship, which again is another operational maturity milestone rarely achieved by a company that's just one year old. The next page.., has a color coding because it just highlights two different moments in our one-year history.

Speaker Change: <unk> are a hallmark of trustworthiness and reliability between Sigma and its clients when we transfer ownership of material export to its final client before keyboards. The ship, which again is another operational maturity milestone rarely achieved by a company. That's just one year old.

Ana Cabral: And at that, I mean, again, we're very proud of having reached our cost target for 2024. I have a schedule, meaning we're now, we continue to be amongst the lowest in the sector and we manage to print every cost target that we indicated to investors early in the year 20, 2022 and we're just in a second quarter, which just shows the direction of this trajectory.

Ana Cabral: The next page has a color coding because it just highlights two different moments in our one-year history. Again, we are now a season producer. We demonstrate shipment by shipment on this page that we have this cadence and reliability of consistently shipping 22,000 tons at every 30 to 35 days, which drive our export credit lines, increasingly more favorable firms and rates. And again, it underpins our commercial independence and commercial assertiveness. The color coding demonstrates this evolution of our commercial strategy. In other words, we've gone from the first six months where we had a counterparty trader that was the principal, moved into where we are today, where there are very forms of exercise and assertiveness, selling to end users, selling to counterparty trading agencies, but trading companies as agents.

Speaker Change: The next page.

Speaker Change: As a color coding because you just highlights two different moments in our one year history again, we are not a season producer we demonstrate shipment by shipment on this page that we have these changes in the liability of consistently shifting 22000 tons.

Ana Cabral: Again, we are now a seasoned producer. We demonstrate shipment by shipment on this page that we have this cadence and reliability of consistently shipping 22,000 tons every 30 to 35 days, which drive our export credit lines, increasingly more favorable terms and rates. And again, it underpins our commercial independence and commercial assertiveness. The color coding demonstrates this evolution of our commercial strategy. In other words, we've gone from the first six months where we had a counterparty trader that was the principal, moved into where we are today, where there are various forms of exercising assertiveness, selling to end users, selling to counterparty trading agencies, but trading companies as agents.

Speaker Change: Every 30 to 35 days, which drive our export credit lines.

Speaker Change: Increasingly more favorable terms and rates up and again underpins, our commercial independence and commercial assertiveness.

Speaker Change: The color coding demonstrates the evolution of our commercial strategy in other words, we've gone from the first six months, where we had a counterparty trader that was the principal moved into where.

Ana Cabral: It would be doing that for an entire year, which is an incredible achievement for a young operation. That has catapulted us to the very top of the metals and mining industry rankings as measured by ICML, the International Council of metals and mining companies. There's just one company that ranks above us on these combined ratings.

Speaker Change: Where we are today, where there are various forms of exercising of sort of who's selling to end users selling to counterparty trading agents, but trading companies at agents up.

Ana Cabral: And up again, this last shipment, this was kept; this one year was kept by sending the last shipment to Mitsubishi, which is a very large industrial cadet. So in Japan, they just associated to tell two other automakers for easy strategy and easy development.

Ana Cabral: And again, this last shipment, this was capped. This one year was capped by sending the last shipment to Mitsubishi, which is a very large industrial cadet. So in Japan, they just associated itself with two other automakers for EV strategy and EV development. So we hit the stride.

Speaker Change: And again this last shipment. This this was cap is one year was capped by sending the last shipment to Mitsubishi which is a very large industrial Kate add show in Japan did just associated to shelf with two other automakers for easy strategy in EV development. So we get this.

Ana Cabral: It's a complete stir to the next page, so I think the summary of where we are is, again, we were able to combine three attributes. They're quite unique and not easily combinable in our industry. We initiated our shipment last year in operating in large scale. We have been maintaining low production costs consistently and we have been delivering the most sustainable lithium in the world. Our lithium became a brand for all attributes related to sustainability and traceability.

Ana Cabral: So we get to strive, and again, we want to also leave you here with the certainty that we're going to further enhance this case. Meaning we're targeting 60,000 tons of sales for the upcoming third quarter closing on September 30th, which is basically just 45 days away. Distract records that we establish allows us to basically tap into these leading global supply chains for lithium, again going direct to downstream members of these supply chains because it's the result of this commercial flexibility. One of the other points we want to make, I mean we are pretty agnostic as far as our client base, but typically given that Asia concentrate the supply chain manufacturing today, we've been equally distributing our shipments into Japanese, South Korean, and Chinese clients, which is a reflection of the industry.

Speaker Change: Try and and again, we want to also leave you here.

Ana Cabral: And again, we want to also leave you here with the certainty that we're going to further enhance this cadence, meaning we're targeting 60,000 tons of sales for the upcoming third quarter, closing on September 30th, which is basically just 45 days away. This track record that we established allows us to basically tap into this leading global supply chains for lithium, again, going direct to, you know, downstream members of these supply chains, because it's the result of this commercial flexibility.

Speaker Change: With the certainty that we're going to further enhance this cadence, meaning we're targeting 60000 tons of sales for the upcoming third quarter closing on September 30th which is basically just 45 days away.

Speaker Change: This track record that we establish allows us to basically tapping to this leading global supply chains for lithium again going direct to you know downstream are members of the supply chain because it's the result of this commercial flexibility.

Ana Cabral: Not one company in our space has been able to deliver what was called the trinity of metal producers since 2018 when our dear Buvara initiated their operation. So six years have passed. Bill is a dollar to be invested in the lithium industry, quite a lot of hype.

Ana Cabral: One of the other points that we want to make, I mean, we are pretty agnostic as far as our client base. But typically, given that, you know, Asia concentrates the supply chain manufacturing today, we've been equally distributing our shipments into, you know, Japanese, South Korea, and Chinese clients, which is a reflection of the industry. The next page, again, is a derivative of the previous page.

Speaker Change: One of the other point that we want to make I mean, we are pretty agnostic as far as our client base, but typically given that Asia concentrates the supply chain manufacturing today, we've been equally distributing ours, our shipments up in into Japanese and South Korea.

Ana Cabral: A massive cycle, but not one company has been able to deliver the trinity that we actually have delivered, which demonstrates how rare an achievement this is, on the next page then, I will encourage you to look at our operational highlights. And again, I'm going to start with this slide where we implement the disclosure of excellence in high standards which drive our entire performance and it's been driving our entire performance throughout 2024.

Speaker Change: And Chinese clients.

Speaker Change: Which is a reflection of the industry. The next page.

Ana Cabral: The next page, again, is a derivative of the previous pages. You can tell on the last chart you have basically the quantification of these two different moments of commercial strategy. First, we had the first six months, and then on this page, we demonstrate where we are today. Will we continue to pre-unize or continue to increase sales price premium relative to peer-licking producers, would be maintaining an average of 10% price pre-unization today, which again are a result of this cadence, reliability of the season as a season producer, and then more importantly, the financial flexibility of our own credit and customer financing lines.

Speaker Change: Again these are derivatives of previous page as you can tell us on the left chart you have basically the quantification of these two different moments of commercial strategy first we had the first six months and then on this page we demonstrate.

Ana Cabral: As you can tell, on the left chart, you have basically the quantification of these two different moments of commercial strategy. First, we had the first six months. And then on this page, we demonstrated where we are today, where we continue to premiumize, we continue to increase sales price premium relative to pure lithium producers. We've been maintaining an average of 10% price premiumization today, which, again, are a result of this cadence, reliability as a seasoned producer.

Ana Cabral: So what we are going to show in these results is that we have what we can show all of our operational elements fully managed and actually demonstrating our operational axles.

Ana Cabral: So starting with the volumes, we have heard of increased the cadence of volume so to 22,000 tons of material shipped every 30 to 35 days.

Ana Cabral: We're very, very proud to present this slide because in the narrow quantification of our ability to operate our block of the city, the industrial mining facilities, adhering to the highest operational standards. We were able to survive in the ITMM ranking, dozens of much larger and much more mature method of mining company producers, just demonstrating that we had to quickly rise in the occasion during our first year, meaning we didn't have a break and no slack was cut for us. Essentially, we had to straight out of the gate, behave like a season producer, commission like a season producer, and ramp up like a season producer.

Where we are today, we continue to bring <unk> to continue to increase sales price premium relative to peer lithium producers producers, we do maintain an average of 10% drive for immunization today, which again are a lot of a result of this cadence.

Ana Cabral: So that means we have achieved what we call reliability as a producer which is linked to our ability to receive favorable rates and favorable turns in export linked credit. Meaning credit lines linked to our ability to continue to maintain this export track record.

Speaker Change: Reliability of the season and the season producers and then more importantly, the financial flexibility of our own credit and customer financing lines, because that allows us to navigate what we've called me cycles in the cycle, meaning the purchase cycles of this spring and fall that take place in this industry, which along.

Ana Cabral: And then more importantly, the financial flexibility of our own credit and customer financing lines, because that allows us to navigate what we call mini cycles in a cycle, meaning the purchase cycles of the spring and fall that takes place in this industry, which allow us to sell into the purchase cycle and therefore achieve the price premiumization.

Ana Cabral: Because that allows us to navigate what we call these cycles in a cycle, meaning the purchase cycle of the spring and fall that takes place in this industry, which allows us to sell into the purchase cycle and therefore achieve the price pre-unization. So we are now able to start to monetize gradually what turns out to be a chemically superior quality of our quintuple zeroly to concentrate. And at that, we turn to the next page where we basically numerically demonstrate that this high quality is what drives bringing pricing. But more importantly, it is a win-win situation for our customers because our customers save significantly if they acquire our product, even at a premium price versus the product of our competitors.

Speaker Change: I wish to sell into the purchase cycle and therefore achieve the price premium amortization. So we are now able to starting to monetize.

Ana Cabral: There are several operational milestones that we will be showing here today which are actually rarely achieved by a company that's just one year old and the rankings you see here are just one of these. The next page talks about our cadence of volume shift, which again, we were able to establish that reliable cadence of product sales, which our homework of the operational maturity of a season producer. We have sold 52,000 five of the tons of our typical zero green lithium concentrate, both in the first and second quarter, which means we're able to manage the cadence and reliability of our shipments.

Ana Cabral: So we are now able to start to monetize gradually what turns out to be a chemically superior quality of our quintuple zero lithium concentrate. And at that, we turn to the next page, where we basically numerically demonstrate that this high quality is what drives premium pricing. But more importantly is a win-win situation for our customers because our customers save significantly if they acquire our product even at a premium prices versus the product of our competitors.

Speaker Change: Gradually what what turns out to be a chemically superior quality of our <unk> zero lithium concentrate and adapt with turning to the next page.

Speaker Change: Where are we where we basically.

Speaker Change: Numerically demonstrating that this high quality is what drives premium pricing.

Speaker Change: More importantly, it's a win win situation for our customers because our customers safe significantly if they acquire our product even at a premium price is versus the product of our competitors up in other words, a high quality is chemically Nashville any translate.

Ana Cabral: In other words, our high quality is chemically measured, and it translates into this cost savings for our customers and their supply chains. So via tons of our product from Sigma means that the client saves approximately 20 to 30% in raw materials when refining lithium hydroxide chemicals, everything else staying the same. So it's a gradual process for us to simply grab that, to simply monetize the portion of that, leaving another portion for the customer in a full win-win relationship.

Ana Cabral: That was possible because of our enhanced credit worthiness at the end of the first quarter. We were able to conduct what we call FLB sales at warehouse, which again, are a whole mark of trustworthiness and reliability between sigma and its clients, when we transfer ownership of material at board to its final client before we board the ship, which again is another operational milestone rarely achieved by a company that's just one year old.

Ana Cabral: In other words, our high quality is chemically measured and it translates into these cost savings for our customers and their supply chains. So buying a ton of product from Sigma means that the client saves approximately 20 to 30 percent in raw materials when refining lithium hydroxide chemicals, everything else staying the same.

Speaker Change: And to this cost savings for our customers and their supply chains. So biased them of our product from Sigma means that the client saves approximately 20% to 30% in raw materials, when refining lithium hydroxide cannibals everything else staying the same.

Ana Cabral: So it's a gradual process for us to simply grab that, to simply monetize a portion of that, leaving another portion for the customer in a full win-win relationship. The next page talks a bit about the operational improvement that we have been able to affect in our green plant over the last year. I mean, we're very proud of this because we keep on perfecting this plant in a continuous effort. And as you recall, it started with the dry stacking. So.

Speaker Change: So it's a gradual process for us to simply grab that assembly.

Speaker Change: Monetize a portion of that leaving another portion for the customer in a full win win relationship.

Ana Cabral: The next page has a color coding because it just highlights two different moments in our one year history. Again, we are now a season producer. We demonstrate shipment by shipment on this page that we have this cadence and reliability of consistently shipping 22,000 tons at every 30 to 35 days, which drive our export credit lines, increasingly more favorable firms and rates. And again, it underpins our commercial independence and commercial assertiveness. The color coding demonstrates this evolution of our commercial strategy.

Ana Cabral: The next page talks a bit about the operational improvement that we have been able to affect in our green plant over the last year. I mean, we're very proud of this because we keep them perfecting this plant in the continuous effort. And as you recall, it started with the dry stacking. A year ago, we were barely finishing commissioning the dry stacking, which has been a centerpiece of our overall purpose as a company to deliver the most sustainable lithium materials in the world, which meant for us not to produce a tailings down, which means we dry stack our fines and our ultra-fines produced by the green pack plant.

Speaker Change: The next page talks a bit about the operational improvement that we have been able to effect in our green black plants over the last year I mean, we're very proud of this because we keep them perfecting this plant in a continues.

Speaker Change: Continuous effort and as you recall it starts with it started with the dry stacking so.

Ana Cabral: A year ago, we were barely finishing commissioning the dry stacking, which has been a centerpiece of our overall purpose as a company to deliver the most sustainable lithium materials in the world, which meant for us not to produce a tailings dam, which means we dry stack our fines and our ultra fines produced by the green pack plant. That means we're also able to maintain. Minimum levels of water usage because we reuse all that water, which in our case comes from sewers.

Speaker Change: A year ago, we were barely finishing commissioning to dry stacking, which has been a centerpiece of our overall purpose as a company to deliver the most sustainable lithium materials in the world, which meant for us not to produce a tailings dam, which which means we dry stack are.

Ana Cabral: In other words, we've gone from the first six months where we had a counterparty trader that was the principal, moved into where we are today, where there are very forms of exercise and assertiveness, selling to end users, selling to counterparty trading agencies, but trading companies as agents. And up again, this last shipment, this was kept, this one year was kept by sending the last shipment to Mitsubishi, which is a very large industrial cadet. So in Japan, they just associated to tell two other automakers for easy strategy and easy development.

Speaker Change: Fine in our Ultrafine produced by the Green tax laws.

Ana Cabral: That means we're also able to maintain minimum levels of water usage because we reuse all that water, which in our case comes from sewage. Now, those operational improvements translate into decreasing the shipment intervals between each boat. So the target is to get 30 to 35 days driving maximum efficiency of the plant and reducing the shipment intervals. And this is kind of how we are going to get to our annual guidance. Now, within the green pack GMS, we again have been affecting further adjustment and further per-sacking display on. Essentially, we have been able to reprocess the fines that were generated in the early commissioning period, which have high grade.

Speaker Change: That means we're also able to maintain.

Speaker Change: Minimum levels of water usage, because we'd be use all that water, which in our case comes from sewage.

Ana Cabral: Now those operational improvements translate into decreasing the shipment intervals between each boat. So the target is to get to 30 to 35 days driving maximum efficiency of the plant and reducing the shipment intervals. And this is kind of how we are going to get to our annual guidance. Now, within the Green Tech GMS, we again have been effecting further adjustments and further perfecting this plan. Essentially, we have been able to reprocess the fines that were generated in the early commissioning period, which have higher grades. They have a lithium oxide grade of about 1.5%.

Speaker Change: Now those operational improvements.

Speaker Change: Translate into decreasing this shipment intervals between each boat. So the target is to get to 30 to 35 days driving maximum efficiency of the plant and reducing just shipment intervals and this is kind of how we are going to get to our annual guidance.

Ana Cabral: So we get to strive and again, we want to also leave you here with the certainty that we're going to further enhance this case. Meaning we're targeting 60,000 tons of sales for the upcoming third quarter closing on September 30th, which is basically just 45 days away. Distract records that we establish allows us to basically tap into these leading global supply chains for Lithium, again going direct to downstream members of these supply chains because it's the result of this commercial flexibility.

Speaker Change: Now within the within the Green Tech Vms, we again have been affecting further up further adjustments and further perfecting display plant.

Speaker Change: Additionally, we have been able to reprocess.

Speaker Change: The fines that were generated in the early commissioning periods, which have higher grades there they have lithium oxide grades of about one 5%. So that means we are benefiting from a double whammy here, where the improvement in the circuit increased daily productivity.

Ana Cabral: They have a lithium oxide grade of about 1.5%. So that means we are benefiting from a double whammy here, where the improvements in the circuit increase daily productivity. So we have higher recovery and higher daily production, but we also utilize that circuit to concentrate material that, if we didn't drive, would be otherwise left inside of tailings. So by recycling material that had zero cost, because it was just essentially tailings, but we had drive acted, we are able to gradually increase our throughput of high period, typical zero lithium concentrate. So some of these results of this continuing improvement have already been reflected in our third quarter performance.

Ana Cabral: So that means we are benefiting from a double whammy here, where the improvements in the circuit increase daily productivity. So we have higher recovery and higher daily production. But we also utilize that circuit to concentrate material that, if we didn't dry stack, would be otherwise left inside a tailings dam.

Speaker Change: So we have higher recoveries and higher daily production, but we also utilized that circuit to concentrate material that if we didn't drive that would be otherwise left inside of tailings dam. So by recycling material that zero cost because it was just essentially dale.

Ana Cabral: One of the other points we want to make, I mean we are pretty agnostic as far as our client base, but typically given that Asia concentrate the supply chain manufacturing today, we've been equally distributing our shipments into Japanese South Korea and Chinese clients, which is a reflection of the industry.

Ana Cabral: So by recycling material that has zero cost, because it was just essentially tailings, but we had dry stacked it, we are able to gradually increase our throughput of high purity quintuple zero lithium concentrate. So some of these results of this continued improvement has already been reflected in our third quarter performance. Hence, the guidance, robust guidance, of 60,000 tons of lithium materials to be shipped in the third quarter that we plan to hit, just resulting from the work we've already done.

Speaker Change: But we had dry stack that we are able to gradually increase our throughput of high purity principles zero lithium concentrate so some of these results of discontinued improvement has already been reflected in our third quarter performance, hence the guidance.

Ana Cabral: The next page, again, is a derivative of the previous pages. You can tell on the last chart you have basically the quantification of these two different moments of commercial strategy. First, we had the first six months and then on this page, we demonstrate where we are today. Will we continue to pre-unize or continue to increase sales price premium relative to peer-licking producers, would be maintaining an average of 10% price pre-unization today, which again are a result of this cadence, reliability of the season as a season producer, and then more importantly, the financial flexibility of our own credit and customer financing lines.

Ana Cabral: Hence the guidance, robust guidance of 60,000 tons of lithium materials to be shipped in the third quarter that we plan to hit, just resulting from the work we've already done.

Speaker Change: <unk>, a robust guidance of 60000 tons of lithium materials to be shipped in the third quarter that we plan to hit.

Ana Cabral: Another very important point in delivering our strategy was the ability to continue to increase the sales price range relative to our competitors.

Speaker Change: Just resulting from the work we've already done.

Ana Cabral: And I think lastly, regarding the crusher, we keep on playing around with new flow sheets for the crusher, which again, help us increase the efficiency. So the latest change in flow sheet is that we're going to create a new setup, which is in line with basically the best crush designs in the world, that separates screens from the motor, again, improving crusher efficiency and benefiting from the customized crusher we created at the plant, which has 1,200 milliliters of job crusher openings, which means less fines, which means higher yield, which means higher productivity. So that's what it all means.

Ana Cabral: And I think lastly, regarding the crusher, we keep on playing around with new flow sheets for the crusher, which again help us increase the efficiency. So the latest changing flow sheet is that we're going to create a new setup, which is aligned with basically the best cross designed in the world that separates screens from the motor. Again, improving crusher efficiency and benefiting from the customized crusher we created at once, which has 1,200 milliliters of drop crusher openings, which means last fines, which means higher yields, which means higher productivity. So that's what it all means. The crease cadence is a result not of one great change, but of a myriad of improvements on this plant that actually needs to our higher confidence that will be hitching 60,000 tons of lithium concentrate sales in the third quarter.

Speaker Change: Lastly, regarding the crusher, we keep on playing around with new flow sheet for the crusher, which again help us increase the efficiency. So the latest changing flow sheet.

Speaker Change: Create a new setup.

Speaker Change: Which is in line with basically the best press designs in the world, they're separate screens from the motor again, improving crusher efficiency are benefiting from the customized crusher we created.

Speaker Change: That's a key element of our strategy and it's a result of increased commercial assertive. So as we deliver cadence of volumes and as we are rewarded by the banking system with a more favorable credit link to the export financing, we are able to continue to push, continue to exercise commercial assertiveness and therefore achieve a sales price range. So these elements are all interlinked, performance of favorable credit lines and then price premium performance.

Speaker Change: At the plant with one which has 1200 millimeters of jaw crusher opening which means less fines, which means higher yield which means higher productivity. So that's what it all means decrease cadence is a result, not of one great change but of a mirror.

Speaker Change: On the cross-front, on the operational front, we are just delighted to have been able to print when the highest cash margins in the sector, especially when this happened against the quarterly where the backdrop of top line resulting from Lithium prices wasn't again something we control but wasn't as favorable.

Ana Cabral: Decreased cadence is a result, not of one great change, but of a myriad of improvements on this plant that actually lead to our higher confidence that we'll be hitting 60,000 tons of lithium concentrate sales in the third quarter. So with that, I'll hand over to my partner, Matt Dayhoe, to go over our financial highlights. Thank you, Ana.

Speaker Change: Our use of improvement on this plant that actually leads to our higher confidence that we'll be hitting 60000 tons of lithium concentrate sales in the third quarter, so with that I'll hand over to my partner, Matt David to go over our financial highlights.

Speaker Change: So it means that by posting this cash margins, we do have our cost structure well as a control.

Matthew DeYoe: So with that, I'll hand over to my partner, Matt Dejo, to go over our financial highlights.

Ana Cabral: But more importantly, is a win-win situation for our customers because our customers save significantly if they acquire our product, even at a premium price versus the product of our competitors. In other words, our high quality is chemically measured and it translates into this cost savings for our customers and their supply chains. So via tons of our product from sigma means that the client saves approximately 20 to 30% in raw materials when refining lithium hydroxide chemicals, everything else staying the same. So it's a gradual process for us to simply grab that, to simply monetize the portion of that, leaving another portion for the customer in a full win-win relationship.

Matthew DeYoe: Thank you. So, in the second quarter, we reported revenues of $45.9 million on nearly $53,000 ton sold, which implies a CIA equivalent realized price to quarter about $89, or $894 ton. The top line was supported by strong cross management, which we'll get into in a moment.

Matt David: Thank you Ron.

Matthew DeYoe: So in the second quarter, we reported revenues of $45.9 million on nearly 53,000 tons sold, which implies a CIF equivalent realized price to the quarter of about $894. The top line was supported by strong cost management, which we will get into in a moment, but our FOB cash operating margins came in at about 54%, while adjusted cash EBITDA margins were closer to 30%. Production on the quarter total just over 49,000 tons. The company is spent energy familiar. Sorry, go to the next slide here.

Matt David: In the second quarter, we reported revenues of $45 $9 million on nearly 53000 tons sold which involves a cif equivalent realized price for the quarter about 89 or $894 a ton.

Matt David: The topline was supported by strong cost management, which we will get into in a moment, but our fob and cash operating margins came in at about 54%, while adjusted cash EBITDA margins were closer to 30%.

Matthew DeYoe: But our F.O.B. Cash operating margins came in at about 54%, while adjusted cash, but down margins were close to the 30%. Production on the quarter, total just over 49,000 tons.

Matt David: Production in the quarter totaled just over 49000 tons.

Matthew DeYoe: The company has spent energy; sorry, I'll go to the next slide here. The company has spent energy familiarizing investors with the implications of provisional price adjustments, particularly with the first few boats that shipped, and we did not have any offsetting settlements. We have taken steps to harmonize our even-dom margins to balance out this volatility. What you're seeing on the left is an allocation of even-dom margins for our business, assuming boats settled accurately without these provisional adjustments. The full breakdown of this math can be found in the appendix, but the message here is that underlying margins for the business are far more stable than what the headlines would indicate.

Speaker Change: The company has spent energy familiar I am sorry, I'll go to the next slide here.

Matthew DeYoe: The company has spent energy familiarizing investors with the implications of provisional price adjustments, particularly with the first few boats that shipped, and we did not have any offsetting settlement. We have taken steps to harmonize our EBITDA margins to balance out this volatility. What you're seeing on the left is an allocation of EBITDA margins for our business, assuming both settled accurately without these provisional adjustments. The full breakdown of this map can be found in the appendix, but the message here is underlying margins for the business are far more stable than what the headlines would indicate. As the extreme market volatility of second half 23 slows, and we establish a regular shipping cadence, we expect these headwinds to subside and ultimately revert as we come back from market rally.

Speaker Change: The company has spent energy familiarizing investors with the implications of provisional price adjustments, particularly with the first few boats that we.

Speaker Change: When we did not have any offsetting settlements.

Speaker Change: We have taken steps to harmonize our EBITDA margins to balance out this volatility what youre seeing on the left is an allocation of EBITDA margins for our business assuming both settled accurately without this provisional adjustments. The full breakdown of this naturally found in the appendix, but the message here is underlying margins for the business are far more stable than what the.

Ana Cabral: The next page talks a bit about the operational improvement that we have been able to affect in our green plant over the last year. I mean, we're very proud of this because we keep them perfecting this plant in the continues effort. And as you recall, it started with the dry stacking. A year ago, we were barely finishing commissioning the dry stacking, which has been a centerpiece of our overall purpose as a company to deliver the most sustainable lithium materials in the world, which meant for us not to produce a tailings down, which means we dry stack our fines and our ultra-fines produced by the green pack plant.

Speaker Change: And at that, I mean, again, we're very proud of having reached our cost target for 2024.

Speaker Change: Lines would indicate.

Matthew DeYoe: As the extreme market volatility is second half 23, it slows, and we establish a regular shipping cadence. We expect these headlines to subside and ultimately revert as we come back from market route.

Speaker Change: As the extreme market volatility of second half 'twenty, three slows and we establish a regular shipping cadence. We expect these headwinds should subside and ultimately revert as we come back for a market route.

Speaker Change: I have a schedule, meaning we're now, we continue to be amongst the lowest in the sector and we manage to print every cost target that we indicated to investors early in the year 20, 2022 and we're just in a second quarter, which just shows the direction of this trajectory.

Matthew DeYoe: On the right side of the slide, you would see in our F.O.B. margins, which is the assessed balance out against peers, with Sigma happily finding its way towards the upper end of echelon of costs. This is predicated on the hard work that I will discuss here.

Matthew DeYoe: On the right side of the slide, you'd seen our FOB margins, which as we had said, balanced out against peers, with Sigma happily finding its way towards the upper end of the echelon of costs. This is predicated on the hard work that I will discuss here. I'm quite pleased to be presenting the cross-slide to you this morning.

Speaker Change: On the right side of the slide you have seen our fob margins, which as we have said balanced out against peers with Sigma halfway finding its way towards the upper end of echelon of costs. This is predicated on the hard work that I will discuss here.

Ana Cabral: That means we're also able to maintain minimum levels of water usage, because we reuse all that water, which in our case comes from sewage. Now, those operational improvements translate into decreasing the shipment intervals between each boat. So the target is to get 30 to 35 days driving maximum efficiency of the plant and reducing the shipment intervals.

Matthew DeYoe: I'm quite pleased to be presenting the cost-wide to you this morning. As the company has been able to achieve broadly, our union cash cost guidance ahead of schedule. Recall we have highlighted the target CIS cost of $510 per tonne, f.o.b. of $420, and plant-gate costs of $370. The numbers in front of you for 2Q represent a reduction of 22% to 24% from our 4Q reported levels, which is where we were when we issued this guidance. As production ramps to the second half of the year, we would expect the operating leverage to drive incremental improvements from these levels.

Speaker Change: I'm quite pleased to be presenting the cost slide to you. This morning.

Matthew DeYoe: The company has been able to achieve, broadly, our unit cash cost guidance ahead of schedule. Recall, we had highlighted the target CIS cost. $510 per ton. FOB of 420, and plant gate cost of $3.70.

Speaker Change: As the company has been able to achieve broadly our unit cash cost guidance ahead of schedule.

Speaker Change: Recall, we had highlighted a target cif cost of $510 per ton.

Speaker Change: F O B a 420.

And plant gate cost of $3 70.

Matthew DeYoe: Numbers in front of you for 2Q represent a reduction of 22%. 24% from our 4Q reported levels, which is where we were when we issued this guidance. As production ramps to the second half of the year, we would expect the operating leverage to drive incremental improvements from these levels. While ocean freight rates are subject to change, we believe we have some room for traction. This is a reflection overall of, I think, how the hard work has paid off on our cost structure and how we see ourselves stacking up globally against some of our peers. We will continue to work through this.

Speaker Change: The numbers in front of you for <unk> represent a reduction of 22% to 24% from our <unk> reported levels, which is where we were when we issued this guidance.

Ana Cabral: And this is kind of how we are going to get to our annual guidance. Now, within the green pack GMS, we again have been affecting further adjustment and further per-sacking display on. Essentially, we have been able to reprocess the fines that were generated in the early commissioning period, which have high grade. They have a lithium oxide grade of about 1.5%. So that means we are benefiting from a double whammy here, where the improvements in the circuit increase daily productivity.

Speaker Change: As production ramps to the <unk>.

Speaker Change: Second half of the year, we will be expect the operating leverage to drive incremental improvements from these levels.

Ana Cabral: So we have higher recovery and higher daily production, but we also utilize that circuit to concentrate material, that if we didn't drive that would be otherwise left inside of tailings. So by recycling material that had zero cost, because it was just essentially tailings, but we had drive acted, we are able to gradually increase our throughput of high period, typical zero lithium concentrate.

Matthew DeYoe: While ocean freight rates are subject to change, we believe we have some room for traction here. This is a reflection overall of how the hard work is paid off on our cost structure and how we see ourselves stacking up globally against some of our peers. We will continue to work through this cost and product to the initiatives to drive home a better cost structure.

Speaker Change: While ocean freight rates are subject to change we believe we have some room for traction here.

This is a reflection overall of I think how the hard work has paid off on our cost structure and how we see ourselves stacking up globally against some of our peers.

Speaker Change: We will continue to work through this.

Matthew DeYoe: Cost and Productivity Initiatives to Drive Home a Better Cost Structure. And this drives, it gets back to exactly what Ana had talked about as it relates to building an operational culture of excellence. And this is this is not our data, this is benchmarks, but I think it's a nice representation of where we think we set and where we are delivering. The next slide is a bit of the same view, though it's a waterfall to reported costs.

Speaker Change: Cost and productivity initiatives to drive home, a better cost structure and this drives nature gets back to exactly what I talked about as it relates to building operational culture.

Matthew DeYoe: And this drives us to get back to exactly what Anna had talked about as it relates to building an operational culture of excellence. And this is not our data; this is benchmarks, but I think it's a nice representation of where we think we'd set and where we are delivered.

Speaker Change: Excellent.

Speaker Change: This is not our data to benchmark, but I think it's a nice representation of where we think we set where we are delivering.

Matthew DeYoe: Supreme. The next side is a bit of the same view, though it's a waterfall to reported cocks. Again, noting we've removed much of the noise present in our initial quarters. In internalizing our commercial efforts and keeping a focus on productivity, it's not only helped us generate revenue and cocks, but it's also helped right size our S.G. and a structure which you see on the right side. Notably, S.G. and A is down, an additional roughly 24% from the second half of 23 levels. And as this productivity plays out, we see further proof of competitive cross-position. As we've said, again, on the prior slide as it relates to the cost curve as provide a benchmark.

Speaker Change: The next slide is a bit of the same view.

Though it's a waterfall to reported costs.

Matthew DeYoe: Again, noting we've removed much of the noise present in our initial quarters, and internalizing our commercial efforts and keeping a focus on productivity. It's not only helped us generate revenue and COGS, but it's also helped right size our SG&A that you see on the right, notably, you know, SG&A is down an additional roughly 24% from, you know, the second half of 23 levels. And as this productivity plays out, we see further proof of competitive cross-position.

Ana Cabral: So some of these results of this continuing improvement have already been reflected in our third quarter performance. Hence the guidance, robust guidance of 60,000 tons of lithium materials to be shipped in the third quarter that we plan to hit, just resulting from the work we've already done.

Speaker Change: Again, noting we removed much of the noise present in our initial quarters.

Speaker Change: In internalizing, our commercial efforts in keeping a focus on productivity has not only helped us generate revenue and Cogs, but its also help rightsize our SG&A structure.

Speaker Change: Which you see on the right side, notably SG&A is down as an additional roughly 24% from the second half of 'twenty three levels.

Ana Cabral: And I think lastly, regarding the crusher, we keep on playing around with new flow sheets for the crusher, which again, help us increase the efficiency. So the latest changing flow sheet is that we're going to create a new setup, which is aligned with basically the best cross designed in the world that separates screens from the motor. Again, improving crusher efficiency and benefiting from the customized crusher we created at once, which has 1,200 milliliters of drop crusher openings, which means last fines, which means higher yields, which means higher productivity.

Speaker Change: And that does productivity plays out we see further proof of competitive cost position.

Matthew DeYoe: You know, as we said, again, on the prior slide as it relates to, You know, the cost curve as provided by. So what does this all kind of mean? It helps drive what we consider to be a highly robust cash flow. So we started the quarter with $108 million in cash, which we supplemented with nearly $46 million in net revenue. Cash costs on the quarter totaled $33 million, which again represents a reduction of nearly 12.5 million from our 3Q23 level.

Speaker Change: As we said again on the prior slide as it relates to.

Speaker Change: The cost curve as provided by benchmark.

Matthew DeYoe: So what does this all kind of mean? It helps drive that we consider to be a highly robust cash model. So we started the quarter with $108 million in cash, which we supplemented with nearly $46 million in net revenues. Cash costs on the quarter total $33 million, which again represents a reduction of nearly $12.5 million from our 3Q23 levels.

Speaker Change: So what does this all kind of mean.

Speaker Change: It helps drive that we consider to be a highly robust cash flow.

Speaker Change: So we started the quarter with $108 million in cash.

Speaker Change: Which we supplemented with nearly $46 million and net revenues.

Speaker Change: Cash costs are in the quarter totaled 33 million.

Ana Cabral: So that's what it all means. The crease cadence is a result not of one great change, but of a myriad of improvements on this plant that actually needs to our higher confidence that will be hitching 60,000 tons of lithium concentrate sales in the third quarter.

Speaker Change: Again represents a reduction of nearly $12 5 million from our three Q 'twenty three levels.

Matthew DeYoe: Working capital did prove to be a headwind to the quarter, which was a function of two primary occurrences. Firstly, there was a reduction to our payables of nearly $14.5 million. And the second was a delay in receivables associated with two of our shipments. As for the pro-formal bridge, you can see that we've since received those payments shortly after quarter close. CapEx on the quarter was roughly $9 million, which represents some payments on the phase two expansion, as well as some of the brownfield mine and plant investments that Anna had mentioned on the prior slides.

Matthew DeYoe: Working capital did prove to be a headwind to the quarter, which was a function of two primary occurrences. Firstly, was a reduction to our payables of nearly fourteen and a half million dollars. The second was the delay in receivables associated with two of our shipments.

Speaker Change: Working capital did prove to be a headwind to the quarter, which was a function of two primary occurrences.

Speaker Change: Firstly was a reduction to our payables of nearly $14 $5 million.

Matthew DeYoe: So with that, I'll hand over to my partner, Matt Dejo, to go over our financial highlights. Thank you. So, in the second quarter, we reported revenues of $45.9 million on nearly $53,000 ton sold, which implies a CIA equivalent realized price to quarter about $89, or $894 ton. The top line was supported by strong cross management, which we'll get into in a moment. But our F.O.B, cash operating margins came in at about 54%, while adjusted cash, but down margins were close to the 30%. Production on the quarter, total just over 49,000 tons.

Speaker Change: And the second was the delay in receivables associated with two of our shipments.

Ana Cabral: As for the pro forma bridge, you can see that we've since received those payments shortly after quarter closed. CapEx on the quarter was roughly $9 million, which represents some payments on the Phase 2 expansion, as well as some of the brownfield mine and plant investments that Ana had mentioned on the prior, With that, I'm going to pass it back to Ana. And we'll talk through a bit the liquidity transition of the company.

Speaker Change: As for the pro forma bridge you can see that we have since received those payments shortly after quarter close.

Speaker Change: Capex on the quarter was roughly $9 million, which represents some payments on the phase two expansion.

Speaker Change: As well as some of the brownfield mine and plant investments that Anna had mentioned on the prior slides.

Ana Cabral: With that, I'm going to pass it back to Anna, and we'll talk through a bit about the liquidity transition of the company.

Honor: With that I'm going to pass it back to honor and we will talk through a bit the liquidity position of the company.

Ana Cabral: Yeah, so again, just to wrap up the financial section, I mean, we have a very comfortable liquidity position. I mean, to consider operational performance, the math was described and we discussed regarding sales cadence and cost control. All of what we described throughout this presentation translated into very, very tangible benefits for this company. In other words, robust access to exporting credit. So robust liquidity. We have a very comfortable liquidity position with the cash balance in August, topping up $99 million US dollars. Basically, when you look at this chart, if you look at the upper left chart, you can see that the short-term debt is basically comprised of those export link trade lines, which are drawn but are entirely sitting in our treasury.

Ana Cabral: Yeah, so again, just to wrap up the financial section, I mean, we have a very comfortable liquidity position. I mean, the consistent operational performance that Matt was described and we discussed regarding sales cadence and cost controls, all of what we described throughout this presentation translated into very, very tangible benefits for this company. In other words, robust access to export link credit. So robust liquidity. We have a very comfortable liquidity position with the cash balance in August, topping up 99 million US dollars.

Honor: Yeah. So again just to wrap up the financial section I mean, we have a very comfortable liquidity position I mean, the consistent operational performance. The math was described and we discussed regarding sales cadence and cost controls.

Matthew DeYoe: The company has spent energy, sorry, I'll go to the next slide here. The company has spent energy familiarizing investors with the implications of provisional price adjustments, particularly with the first few boats that shipped, and we did not have any offsetting settlements. We have taken steps to harmonize our even-dom margins to balance out this volatility. What you're seeing on the left is an allocation of even-dom margins for our business, assuming boats settled accurately without these provisional adjustments.

Honor: All of what we described throughout this presentation translated into very very tangible benefits for this company.

Speaker Change: The words robust access to export link credits show robust liquidity, we have a very comfortable liquidity position with a cash balance in August topping up 99 million U S dollars up basically when you look at this chart. If you look at the upper the upper.

Matthew DeYoe: The full breakdown of this math can be found in the appendix, but the message here is underlying margins for the business are far more stable than what the headlines would indicate. As the extreme market volatility is second half 23, it slows, and we establish a regular shipping cadence. We expect these headlines to subside, and ultimately revert as we come back from market route. On the right side of the slide, you would see in our F.O.B, margins, which is the assessed balance out against peers, with Sigma happily finding its way towards the upper end of echelon of costs. This is predicated on the hard work that I will discuss here.

Ana Cabral: Basically, when you look at this chart, if you look at the upper left chart, you can see that the short term debt is export link, is basically comprised of those export link trade lines, which are drawn, but are entirely sitting in our treasury.

Speaker Change: <unk> left chart you can see that the short term debt is export link.

Speaker Change: He's basically comprised of those export linked the trade lines, which are drawn but are entirely sitting in our treasury.

Ana Cabral: In other words, we could pay them all back today, if they're all due. More importantly, and that's the key point. We have decreased the cost of these export-linked credits to 5.85 total fixed in dollars, which is a very, very favorable rate for a company in its first year. And again, that's a sharp contrast to 15.15% that we were granted in our very first trade line in January 2024, this very first trade line being retired long, long ago.

Ana Cabral: In other words, we could pay them all back today if they're all due. More importantly, and that's the key point, we have decreased the cost of these export link credit to $5.85 total fixed in dollars, which is a very, very favorable rate for a company in its first year. And again, that's a sharp contrast to 1515 percent that we were granted in our very first trade line in January 2024. This very first trade line has been retired long, long ago, but it just shows the quick evolution of our robust credit worth. And as we continue to demonstrate sales cadence and cost.

The words, we could pay them all back today, if they're all do.

Speaker Change: More importantly, and that's the key point.

Speaker Change: We have decreased the cost of these export linked.

Speaker Change: 2585 total fixed in dollars, which is a very very favorable rate for our company in its first year.

Matthew DeYoe: I'm quite pleased to be presenting the cost-wide to you this morning. As the company has been able to achieve broadly, our union cash cost guidance ahead of schedule. Recall we have highlighted the target CIS cost of $510 per tonne, F.O.B, of $420, and plant-gate costs of $370. The numbers in front of you for 2Q represent a reduction of 22% to 24% from our 4Q reported levels, which is where we were when we issued this guidance.

Speaker Change: And again that is a sharp contrast to 15, one 5% that we were granted in our very first straight line in January 2020 for this very frustrated lives being retired long long ago, but it just shows the.

Ana Cabral: But it just shows the quick evolution of our robust credit worthiness as we continue to demonstrate sales cadence and cost distance. And that is a good segue for the following page, where we actually talk about our talk about our phase two expansion and give you an update on that. First, I have to reiterate this very strong and compelling business case for Sigma to continue to push and execute on doubling its production capacity by expanding its industrial facilities in Brazil.

Speaker Change: Quick evolution of our robust credit worthiness as we continue to demonstrate sales cadence and cost discipline.

Ana Cabral: of life.

Ana Cabral: And that is a good segue for the following stage, where we actually talk about our face to expansion and give you an update on that. First, I have to reiterate this very strong and compelling business case for Sigma to continue to push and execute on doubling its production capacity by expanding its industrial facilities in Brazil. I mean, we have a very, very privileged position in this industry where we actually have an industrial line that delivers or that actually represents one of the lowest-capex-intensive projects in the world. And this is actually measurable. And this is why you love these industries because they remove the opinion out of the conversation.

Speaker Change: And that is a good segue for the following page, where we actually talk about talk about our phase two expansion and give you an update on that.

Matthew DeYoe: As production ramps to the second half of the year, we would expect the operating leverage to drive incremental improvements from these levels. While ocean freight rates are subject to change, we believe we have some room for traction here. This is a reflection overall of how the hard work is paid off on our cost structure and how we see ourselves stacking up globally against some of our peers. We will continue to work through this cost and product to the initiatives to drive home a better cost structure.

First I have to reiterate this very strong and compelling business case for Sigma to continue to push.

Speaker Change: And execute on doubling its production capacity by expanding its industrial facilities in Brazil, I mean, we have a very very privileged position in this industry, where we actually have a industrial lie that delivers or that actually represents.

Ana Cabral: I mean, we have a very, very privileged position in this industry where we actually have a industrial line that delivers or that actually represents one of the lowest capex intensive projects in the world. And this is actually measurable. And this is why we love these indexes, because they remove the opinion out of the conversation. Mathematics is just a data, a number, doesn't carry a new.

Speaker Change: One of the lowest capex intensive projects in the World and this is actually measurable and this is why we love. These indexes because they removed the opinion out of the conversation mathematics is just a data number doesn't carry in your opinion. So what we did we track.

Speaker Change: We do believe that this is the result of a bottom-up, top-down culture, so it would be impossible to achieve all these metrics if we hadn't implemented what we call a cultural excellence in high standards amongst our employees. And that starts with a key metric that's highly beneficial to them, which is safety. Again, we're very proud of having completed the full year with no fatalities, zero fatalities, and zero accidents without loss of worth, which means we sent our people back to their families safe.

Matthew DeYoe: And this drives us to get back to exactly what Anna had talked about as it relates to building an operational culture of excellence. And this is not our data, this is benchmarks, but I think it's a nice representation of where we think we'd set and where we are delivered. Supreme.

Speaker Change: It would be doing that for an entire year, which is an incredible achievement for a young operation.

Ana Cabral: Mathematics is just a data, a number, doesn't carry a new opinion. So what we did, we tracked announced projects in capex announcements. And we calculated what we call capex efficiency ratio, which is essentially a division of the total capex of a project US dollar millions by the production capacity in tons for tons of lithium concentrates all around the world. And we rank at the very top of this rank, meaning we are the most efficient in the lowest capex-intensive project in the world. On the last, we give you a bit more color where you can see a plotting on a 2D chart with a bubble that just gives you the size of the of the size of the index calculated on the chart to the right, which again shows our little tiny index, which is point 40, and how efficient we are.

Speaker Change: That has catapulted us to the very top of the metals and mining industry rankings as measured by ICML, the International Council of metals and mining companies.

Ana Cabral: So what we did, we tracked announced projects in CAPEX announcements, and we calculated what we call CAPEX efficiency ratio, which is essentially a division of the total CAPEX of a project in US dollar millions by the production capacity in tons for tons of lithium concentrate all around the world. And we rank at the very top of this rank, meaning we are the most efficient and the lowest CAPEX intensive project in the world.

Speaker Change: <unk> announced project in.

Speaker Change: There's just one company that ranks above us on these combined ratings.

Matthew DeYoe: The next side is a bit of the same view, though it's a waterfall to reported cocks. Again, noting we've removed much of the noise present in our initial quarters. In internalizing our commercial efforts and keeping a focus on productivity, it's not only helped us generate revenue and cocks, but it's also helped right size our S.G, and A structure which you see on the right side. Notably, S.G, and A is down, an additional roughly 24% from the second half of 23 levels. And as this productivity plays out, we see further proof of competitive cross-position. As we've said, again, on the prior slide as it relates to the cost curve as provide a benchmark.

Speaker Change: <unk> Capex announcements and we calculated what we call Capex efficiency ratio, which is essentially a division of the total capex of the project in U S. Dollar millions by the production capacity in tons for tons of lithium concentrate.

Speaker Change: It's a complete stir to the next page, so I think the summary of where we are is, again, we were able to combine three attributes.

Speaker Change: They're quite unique and not easily combinable in our industry.

Speaker Change: All around the world.

Speaker Change: And we rank at the very top of this rank, meaning we are the most efficient.

Speaker Change: And the lowest Capex intensive project in the world on the left we give you a bit more color where you can see are plotting on a two D chart with a bubble that just gives you the size of the size of the of the size of the.

Ana Cabral: On the left, we give you a bit more color where you can see a plotting on a 2D chart with a bubble that just gives you the size of the index calculated on the chart to the right, which again shows our little tiny index, which is 0.40, and how efficient we are. The smaller the bubble, and again, the lower the quadrant, the better the project is.

Speaker Change: This index calculated on the chart to the right, which again shows our little tiny index, which is <unk> and how efficient we are the smaller the bubble up and again the lower the quadrant.

Matthew DeYoe: So what does this all kind of mean? It helps drive that we consider to be a highly robust cash model. So we started the quarter with $108 million in cash which we supplemented with nearly $46 million in net revenues. Cash costs on the quarter total $33 million, which again represents a reduction of nearly 12.5 million from our 3Q23 levels. Working capital did prove to be a headwind to the quarter, which was a function of two primary occurrences.

Ana Cabral: The smaller the bubble and again the lower the quadrant, the better the project is. So we're kind of fitting a legal wrong in terms of capital efficiency here. And again, this is a result of what I'm going to show you in the next slide. And I'll skip two slides, and then I'll go back one second. In the next slide, you can see the IARIO demonstration of our site, our industrial site in Brazil. You have one square kilometer of industrial facilities here. So when you see the layout, you can see that you have in green the existing insights inside the gate or the capex infrastructure inside the gate.

Speaker Change: We initiated our shipment last year in operating in large scale.

Speaker Change: The project is so we're kind of sitting in a legal wrong in terms of capital efficiency here and again. This is a result of what I'm going to show you on the last slide and I'll Skip to slides and then I'll go back.

Ana Cabral: So we're kind of sitting in a league of our own in terms of capital efficiency here. And again, this is the result of what I'm going to show you on the next slide. And I'll skip two slides and then I'll go back one second.

Ana Cabral: In the next slide, you can see the aerial demonstration, of our site, our industrial site in Brazil. You have one square kilometer of industrial facilities here. So when you see the layout, you can see that you have in green the existing insight inside the gate or the CAPEX infrastructure inside the gate. That infrastructure is sufficient to essentially support three production lines that have the same throughput as our first production line with 270,000 tons of lithium concentrate per year.

Speaker Change: One second in the next slide you can see D. I areal demonstration of our site our industrial sites in Brazil, you have one square kilometer of industrial facilities here. So when you see the delay out you can see that you have in green the existing <unk>.

Matthew DeYoe: Firstly, was a reduction to our payables of nearly $14.5 million. And the second was a delay in receivables associated with two of our shipments. As for the pro-formal bridge, you can see that we've since received those payments shortly after quarter close.

Speaker Change: Insight inside the gate or the Capex infrastructure inside the gate that infrastructure is sufficient to essentially support three production lines that have the same throughput as our first production line with 270000 tons of lithium concentrate per year.

Ana Cabral: That infrastructure is sufficient to essentially support three production lines that have the same throughput as our first production line with 270,000 tons of lithium concentrates per year. So benefiting from this existing capex infrastructure, the cost is almost 40 million US dollars. We will just build; we just need to build in order to double production capacity, one line as opposed to building line plus additional infrastructure. So that lowers the construction cost significantly, as you can see on this slide, because the construction capex to build to replicate one production line is 100 million US dollars. Now, based on what I just discussed regarding trade lines, we've been using these trade lines to deploy the early capex required for this project, because for the first six months to nine months of the project, the cost of actual deployment is quite low, and we can perfectly cover that with our trade lines, which are quite robust and with our own cash generate.

Matthew DeYoe: CapEx on the quarter was roughly $9 million, which represents some payments on the phase two expansion, as well as some of the brownfield mine and plant investments that Anna had mentioned on the prior slides.

Ana Cabral: So benefiting from this existing CAPEX infrastructure, which costs us almost 40 million U.S. dollars, we will just build, we just need to build in order to double production capacity one line as opposed to building line plus additional infrastructure. So that lowers the construction cost significantly, as you can see on this slide, because the construction CAPEX to build, to replicate one production line is a hundred million US dollars. Now, based on what I just discussed regarding trade lines, we'd be using these trade lines to deploy the early CAPEX required for this project, because for the first six months to nine months of the project, the cost of actual deployment is quite low.

So benefiting from this existing existing capex infrastructure with cost is almost 40 years 40 million U S. Dollars. We will just build we just need to build in order to double production capacity one one line as opposed to building line plus.

Ana Cabral: With that, I'm going to pass it back to Anna and we'll talk through a bit about the liquidity transition of the company. Yeah, so again, just to wrap up the financial section, I mean, we have a very comfortable liquidity position. I mean, to consider operational performance, the math was described and we discussed regarding sales cadence and cost control. All of what we described throughout this presentation translated into very, very tangible benefits for this company.

Speaker Change: Additional infrastructure, so that lowers the construction cost significantly as you can see on this slide because the construction capex to build to replicate one production line is $100 million now based on what I just discussed regarding trade lines we'd be.

Ana Cabral: In other words, robust access to exporting credit. So robust liquidity. We have a very comfortable liquidity position with the cash balance in August, topping up $99 million US dollars. Basically, when you look at this chart, if you look at the upper the upper left chart, you can see that the short term debt is basically comprised of those export link trade lines, which are drawn, but are entirely sitting in our treasury. In other words, we could pay them all back today if they're all due.

Speaker Change: Using these trade lines to deploy the early Capex required for this project because for the first six months to nine months of the project. The cost of actual deployment is quite low and we can perfectly covered apps with our trade lines, which are quite robust and with our own cash generation.

Ana Cabral: And we can perfectly cover that with our trade lines, which are quite robust and with our own cash generation. And so as you can see here, we have this cash position which keeps on getting replenished every month as we receive the proceeds of our very cadent sales. And then we essentially have these trade lines which are drawn but get replenished every month with our own cash generation internally. So we have an ample and very comfortable position to continue to execute our Phase II expansion in the timetable that we have set forth, which is a 12-month construction period.

Ana Cabral: Foundation. And so, as you can see here, we have this cash position which keeps on getting replenished every month as we receive the proceeds of our very cadence sales. And then we essentially have these straight lines which are drawn but get replenished every month with our own cash generation internally. So we have an ample and very comfortable position to continue to execute our face-to-expansion in the timetable that we have a set for, which is a 12 month construction period. We already started it, so if we look at the current slide, we have worked on the way with conducting what a very important point, a very, very important point that we undertook doing phase 1 as well, which is to conduct the suppression of the what we call the savannah, the desertic, sanitary, cactus, bush vegetation, adhering to the very high standards of environmental sustainability.

Speaker Change: And so as you can see here, we have this cash position, which keeps on getting replenished every month as we receive.

Speaker Change: The proceeds of our our very cadence up sales.

Speaker Change: And then we essentially have these trade lines, which are drawn but get replenished every month with our own cash generation internally. So we have an ample and very comfortable position to continue to execute our phase two expansion in in the timetable that we.

Ana Cabral: More importantly, and that's the key point, we have decreased the cost of these export link credit to $5.85 total fixed in dollars, which is a very, very favorable rate for a company in its first year. And again, that's a sharp contrast to 1515 percent that we were granted in our very first trade line in January 2024. This very first trade line has been retired long, long ago, but it just shows the quick evolution of our robust credit worth. And as we continue to demonstrate sales cadence and cost, of life.

Speaker Change: Have a set forth, which is a 12 month construction period, we already started it. So if we look at the current slide we have worked works underway with conducting what would a very important point.

Ana Cabral: We already started it, so if we look at the current slide, we have work underway. We're conducting what is a very important point, a very, very important point that we undertook during Phase I as well, which is to conduct the suppression of what we call the savanna, the deserted semi-arid cactus bush vegetation adhering to the very high standards of environmental sustainability. So we're doing what we call inventory of species. We're doing fauna capturing, so if you find a fauna species, which are basically reptiles, so we capture them, we inventory them, and we deliver them to the appropriate authorities.

Speaker Change: A very very important point that we undertook doing phase one as well which to conduct the suppression of the what we call the Savannah.

Speaker Change: Deserted semiarid CAC to as Bush vegetation a D.

Speaker Change: We're into the very high standards of environmental sustainability. So we're doing what we call.

Ana Cabral: So we're doing what we call inventory of speeches. We're doing fauna capturing, so if you find a fauna speeches, which are basically reptiles, we capture them, we inventory them, and we deliver them to the appropriate authorities. So we're doing this adhering to the very high standards globally of what we call clearing an area for earth works, which is exactly what we did when we constructed phase 1. So that's kind of how we operate. You can clearly see here in pictures that work being conducted by our own proprietary team. So that's an expertise we have in our mental department.

Speaker Change: Inventory of up speeches, we're doing fallen of capturing so if you find a foreigner speeches, which amazing basically wrapped styles. So we captured them, we inventory damage, we deliver them to the appropriate authorities. So we're doing this is jerry to the very high standards globally off.

Ana Cabral: So we're doing this adhering to the very high standards globally of what we call clearing an area for earthworks, which is exactly what we did when we constructed Phase I. So that's kind of how we operate. And you can clearly see here in the pictures that work being conducted by our own proprietary team. So that's an expertise we have in our own environmental department. On the next slide, it's just a recapping, right?

Speaker Change: What we call clearing an area for earthworks, which is exactly what we did when we constructed phase one so that's kind of how we operate.

Speaker Change: You can clearly see here in pictures.

Speaker Change: That work being conducted by our own proprietary team because that's an expertise we have in our own environmental Department on the next slide is just recapping right, where we going well we are clearly on a very disciplined approach to reach 100000 tons.

Ana Cabral: And this is actually measurable. And this is why you love these industries because they remove the opinion out of the conversation. Mathematics is just a data, a number, doesn't carry a new opinion. So what we did, we tracked announced projects in capex announcements. And we calculated what we call capex efficiency ratio, which is essentially a division of the total capex of a project US dollar millions by the production capacity in tons for tons of lithium concentrates all around the world.

Ana Cabral: On the next slide is just a recapping where we're going. Well, we are clearly on a very disciplined approach to reach 100,000 tons of lithium carbonate equivalent production, essentially by 2026. One production line at a time. We show to the product. We show to these sites, our industrial site. We have all the area we need there. There's one square kilometer off industrial area. The capex infrastructure on site supports two lines. And so what we're doing as a result of the lithium market environment, which we don't control, is to focus on what we control, which is to have a very disciplined approach to capacity expansion.

Ana Cabral: Where are we going? Well, we are clearly on a very disciplined approach to reach 100,000 tons of lithium carbon equivalent production essentially by 2026. One production line at a time. We showed you these sites, our industrial sites. We have all the area we need there. There's one square kilometre of industrial area.

Speaker Change: Lithium.

Speaker Change: But it's equivalent production.

Speaker Change: Essentially by 20 to 26, one production line at a time, we showed at the show to these sites our industrial sites. We have all the area we need there there's one square kilometer of industrial areas.

Ana Cabral: The CAPEX infrastructure on site supports two lines. And so what we're doing as a result of the lithium market environment, which we don't control, is to focus on what we control, which is to have a very disciplined approach to capacity expansion, meaning we're doing one production line per year. We're not doubling up on production lines, which basically gives us a very measurable and a very achievable construction project to deliver to our shareholders within the next 12 months.

Speaker Change: Capex infrastructural side supports two lines and so what we're doing as a result of the lithium market environment, which we don't control is to focus on what we control which is to have a very disciplined approach to capacity expansion, meaning we're doing well.

Ana Cabral: And we rank at the very top of this rank, meaning we are the most efficient in the lowest capex-intensive project in the world. On the last, we give you a bit more color where you can see a plotting on a 2D chart with a bubble that just gives you the size of the of the size of the index calculated on the chart to the right, which again shows our little tiny index, which is point 40, and how efficient we are.

Ana Cabral: Meaning we're doing one production line per year. We're not doubling up on production lines, which basically gives us a very measurable and a very achievable construction project to deliver to our shareholders within the next 12 months. So at that, we're going to increase production capacity to approximately 80,000 tons of lithium carbonate equivalent, or 520,000 tons of lithium concentrates. We're hoping to hit that by this time next year. And then we're going to embark on the third construction, which is again, to put another parallel third production line with the same capacity, named like capacity of 250,000 tons of LCEs parallel to that.

Speaker Change: One production line for ear, we're not doubling up on production lines, which basically gives us a very measurable and are very achievable construction project to deliver to our shareholders within the next 12 months, so that we're going to increase production capacity to approximately.

Ana Cabral: So at that, we're going to increase production capacity to approximately 80,000 tons of lithium carbon equivalent or 520,000 tons of lithium concentrate. We're hoping to hit that by this time next year. And then we're going to embark on the third construction, which is, again, to put another parallel, third production line with the same capacity, nameplate capacity of 250,000 tons of LTE, parallel to that. So very, very well planned, thoroughly executed.

Speaker Change: 80000 tons of lithium carbonate equivalent or 520000 tons of lithium concentrate we're hoping to hit that by this time next year and then we are going to embark on the third construction, which is again to put another parallel.

Speaker Change: Third third third production line with the same capacity nameplate capacity of 250000 tons of LTE parallel to that so very very well planned thoroughly executed.

Ana Cabral: You have one square kilometer of industrial facilities here. So when you see the layout, you can see that you have in green the existing insights inside the gate or the capex infrastructure inside the gate. That infrastructure is sufficient to essentially support three production lines that have the same throughput as our first production line with 270,000 tons of lithium concentrates per year. So benefiting from this existing capex infrastructure, the cost is almost 40 million US dollars, we will just build, we just need to build in order to double production capacity, one line as opposed to building line plus additional infrastructure.

Ana Cabral: So very, very well planned, thoroughly executed. And we're simply just replicating what we've done on phase one with the same discipline, because ironically, we're always called to build these facilities when the market conditions aren't exactly bullish. So we have to exercise the discipline that has become our last name here at SAKEMOP.

Ana Cabral: And we're simply just replicating what we've done on phase one with the same discipline, because ironically, we're always called to build these facilities when the market conditions aren't exactly bullish. So we have to exercise the discipline that has become our last name here at SIGEMO. The next page, essentially talked a bit about the market and gives you a bit of color of the way we're seeing things. And I want to share that page with Matt a bit.

Speaker Change: And we're simply just replicating what we've done on phase one with the same discipline because ironically, we're always calls to build these facilities when the market conditions arent exactly bullets. So we have to exercise the discipline that has become our last name here.

Ana Cabral: The next phase. is essentially talked a bit about the market and gives a bit of color of the way we're seeing things. And I want to share that page with Matthew based. I'll comment on this slide, and then Matthew will comment on a few other slides. So share the section with my partner here. This first slide, I'll cover that one. Essentially, it's pretty clear to all participants in the supply chain that the growth engine of electric vehicles this year is China. China is delivered almost 40% growth in the year, in out in electric vehicles all in like BVV sales.

Speaker Change: The next page.

Speaker Change: Essentially talks a bit about the market and gives you a bit of color of the way were seeing things that I want to share that page with Matt that with our comments on the slides and then Matt will comment on a few others like so sure. The SaaS the section with my partner here. This this first slide I'll cover that one essentially.

Ana Cabral: I'll comment on the slide and then Matt will comment on a few other slides. So I'll share the section with my partner here. This first slide, I'll cover that one. Essentially, it's pretty clear to all participants in the supply chain that the growth engine of electric vehicles this year is China. China has delivered almost 40% growth in the year in electric vehicles all in, like BEVs, PEVs sales. And China is bound to reach 60% of the global EV market by the end of the year, overtaking Europe.

Ana Cabral: So that lowers the construction cost significantly, as you can see on this slide, because the construction capex to build to replicate one production line is 100 million US dollars. Now, based on what I just discussed regarding trade lines, we've been using these trade lines to deploy the early capex required for this project, because for the first six months to nine months of the project, the cost of actual deployment is quite low, and we can perfectly cover that with our trade lines, which are quite robust and with our own cash generate.

Matt David: It's pretty clear to all participants in the supply chain that the growth engine of electric vehicles. This year is China.

Matt David: China has delivered almost 40% growth in the year in our being electric vehicles, all in like Bv's PV sales.

Ana Cabral: And China's bounds to reach 60% of the global EV market by the end of the year, overtaking Europe. Which means that China has, which is a result actually of a consistent policy making, of consistent policy making exercise over the last decade when China has enacted a very successful EV growth subsidy program. And when you think about it, and again, just to think about it, in 2019, EV sales in China were about 3% of total car sales. No one have taught that in 2024, just five years later, twice a year already, EV sales surpassed sales of combustion cars three or four times during this year already.

Speaker Change: Chinese bonds to reach 60% of the global E&P market by the end of the year overtaken Europe, which means that.

Ana Cabral: Which means that, China has, which is a result, actually, of a consistent policy making, of consistent policy making exercise over the last decade, when China has enacted a very successful EV growth subsidy program. And when you think about it, and again, just to think about it, in 2019, EV sales in China were about 3% of total car sales. No one had taught, that in 2024, just five years later, twice a year already, EV sales surpassed sales of combustion cars three or four times during this year already, meaning represented over 50% of overall cars sold in China. It's a remarkable achievement.

Speaker Change: China is.

Ana Cabral: Foundation. And so as you can see here, we have this cash position which keeps on getting replenished every month as we receive the proceeds of our very cadence sales. And then we essentially have these straight lines which are drawn but get replenished every month with our own cash generation internally. So we have an ample and very comfortable position to continue to execute our face-to-expansion in the timetable that we have a set for which is a 12 month construction period.

Speaker Change: Which is a result actually of a consistent policy, making of consistent policy, making exercise over the last decade, when China has enacted a very successful easy growth up subsidy programs and when you think about it and again just to think about it in two.

Speaker Change: 19, EV sales in China, or about 3% of total car sales.

Speaker Change: No one has got that in 2020 for just five years later twice a year already.

EV sales surpassed sales of combustion cars.

Speaker Change: We have been maintaining low production costs consistently and we have been delivering the most sustainable lithium in the world. Our lithium became a brand for all attributes related to sustainability and traceability.

Ana Cabral: We already started it so if we look at the current slide we have worked on the way with conducting what a very important point, a very very important point that we undertook doing phase 1 as well, which to conduct the suppression of the what we call the savannah, the desertic, sanitary, cactus, bush vegetation, adhering to the very high standards of environmental sustainability. So we're doing what we call inventory of speeches. We're doing fauna capturing so if you find a fauna speeches which are basically reptiles, so we capture them, we inventory them and we deliver them to the appropriate authorities.

Speaker Change: Three or four times during this year already meaning represented over 50% of our.

Ana Cabral: We represented over 50% of overall cars sold in China. It's a remarkable achievement. And at that, I will encourage you to look at this slide on the left. So the global demand is essentially, despite the behavior of EV sales in the western car market, the global demand is clearly set on the path to reach 1.1 million times of LCE equivalent by the end of 2024. If China can choose just on the face it is, we're going to need 1.4 million tons of LCE equivalent just by next year. What does that mean? It means you're going to need about 8 segments, right?

Speaker Change: Overall.

Speaker Change: Car sold in China, It's a remarkable achievement and a DAC I'll encourage you to look at the slide on the left so the global demand is is is essentially up despite the behavior of the sales in the western.

Ana Cabral: And at that, I will encourage you to look at the slide on the left. So the global demand is essentially, despite the behavior of EV sales in the Western car market, the global demand is clearly set on the path to reach 1.1 million tons of LCE equivalent by the end of 2024. If China continues just on the pace it is, we're going to need 1.4 million tons of LCE equivalent just by next year. What does that mean? It means you're going to need about eight sigmas, right? Eight sigmas to reach these numbers, which is a pretty sizable number.

Speaker Change: Not one company in our space has been able to deliver what was called the trinity of metal producers since 2018 when our dear Buvara initiated their operation. So six years have passed.

Speaker Change: Car market. The global demand is clearly set on a path to reach one 1 million tons of LTE equivalent.

Speaker Change: By the end of 2024, if if if China continues just on the face. It is we're going to need one 4 million tons of LTE equivalent just by next year, what does that mean, it means you're going to need about eight segments right Inc. Sigma.

Ana Cabral: So we're doing this adhering to the very high standards globally off what we call clearing an area for earth works which is exactly what we did when we constructed phase 1. So that's kind of how we operate. You can clearly see here in pictures that work being conducted by our own proprietary team. So that's an expertise we have in our mental department.

Ana Cabral: 8 segments to reach these numbers, which is a pretty sizable number. In other words, the market is growing annually. Now what is equivalent to the entire size of the whole market just five years ago, meaning the whole market was 200,000 tons LCE in 2019. And that is the volume that is added to the market in the market, basically having only China as a local motive, which basically shows you that, you know, this market demand fundamentals are very much in there, because we never ever thought that we would see this kind of level of lithium carbon and equivalent demand back five years ago in 2025.

Speaker Change: Two.

Speaker Change: To reach these numbers, which is a pretty sizable number in other words the market is growing annually now what.

Ana Cabral: In other words, the market is growing annually now, what is equivalent to the entire size of the whole market just five years ago, meaning the whole market was 200,000 tons LCE in 2019. And that is the volume that is added to the market in the bear case that prevails today. Just basically having only China as a locomotive, which basically shows you that, You know, this market demand fundamentals are very much in that because we never ever thought that we would see this kind of level of lithium carbon and equivalent demand back five years ago in 2025.

Speaker Change: It's equivalent to the entire size of the whole market just five years ago, meaning the whole market was 200000 tons LTE in 2019 and that is the volume that is added to the market in the bare case that prevails today.

Speaker Change: Bill is a dollar to be invested in the lithium industry, quite a lot of hype.

Speaker Change: A massive cycle, but not one company has been able to deliver the trinity that we actually have delivered, which demonstrates how rare an achievement this is, on the next page then, I will encourage you to look at our operational highlights.

Speaker Change: Just basically having only China as a locomotive, which basically shows you that.

Speaker Change: And again, I'm going to start with this slide where we implement the disclosure of excellence in high standards which drive our entire performance and it's been driving our entire performance throughout 2024.

Speaker Change: We're very, very proud to present this slide because in the narrow quantification of our ability to operate our block of the city, the industrial mining facilities, adhering to the highest operational standards.

Speaker Change: This market.

Speaker Change: Demand fundamentals are very much in that because we never ever thought that we would see these kind of levels of lithium.

Speaker Change: We were able to survive in the ITMM ranking, dozens of much larger and much more mature method of mining company producers, just demonstrating that we had to quickly rise in the occasion during our first year, meaning we didn't have a break and no slack was cut for us. Essentially, we had to straight out of the gate, behave like a season producer, commission like a season producer, and ramp up like a season producer.

Ana Cabral: All of you remember the first time Rothschild put out the 1 million ton LCE demand for 2025 in 2019, and that was the biggest bouquet of the whole industry. Well, now that's our reality. In fact, it's our bear case.

Speaker Change: Carbon and equivalent demand back five years ago in 2025, all of you remember the first time rock you put out the 1 million ton LTE demand for 2025 in 2019 and that was the biggest bouquets of the whole industry well now that's our read.

Matthew DeYoe: All of you remember the first time rock you put out the 1 million ton LCE demand for 2025 in 2019. And that was the biggest bouquet of the whole industry. Well, now that's our reality. In fact, it's our fair case. So I want to just recap these numbers because sometimes we get lost in the day-to-day of the ads and flows of prices, and we forget how compelling the actual fundamentals of the industry are. Yeah, and to build on that a little bit, as we talk about some of the dynamicism of the industry, and we don't have a slide on this in particular, but what we've seen is it's been encouraging is the fly wheel effect, lower price is stimulating demand in other markets, and I think we've seen a number of market commentators talk about the strength and energy storage the last quarter or two, and Tesla's mega pack numbers over the last two-queue resolve kind of reflect the improved economics of energy storage projects as prices for batteries fall, and that's kind of economics cheering economics at that year.

Speaker Change: There are several operational milestones that we will be showing here today which are actually rarely achieved by a company that's just one year old and the rankings you see here are just one of these.

Ana Cabral: Meaning we're doing one production line per year. We're not doubling up on production lines, which basically gives us a very measurable and a very achievable construction project to deliver to our shareholders within the next 12 months. So at that we're going to increase production capacity to approximately 80,000 tons of lithium carbonate equivalent or 520,000 tons of lithium concentrates. We're hoping to hit that by this time next year. And then we're going to embark on the third construction, which is again, to put another parallel third production line with the same capacity, named like capacity of 250,000 tons of LCEs parallel to that.

Speaker Change: The next page talks about our cadence of volume shift, which again, we were able to establish that reliable cadence of product sales, which our homework of the operational maturity of a season producer.

Ana Cabral: So I want to just recap these numbers, because sometimes we get lost in the day to day of the ebbs and flows of prices, and we forget how compelling the actual fundamentals of the industry are. Yeah, and to build on that a little bit, as we talk about some of the dynamicism of the industry, we don't have a slide on this in particular, but what we've seen is has been encouraging is the flywheel effect of lower prices, stimulating demand in other markets.

Speaker Change: And in fact, that's out there.

Speaker Change: So I wanted to just recap these numbers because sometimes get lost in the day to day of the ebbs and flows of prices and we forget how compelling the actual fundamentals of the industry.

Speaker Change: We have sold 52,000 five of the tons of our typical zero green lithium concentrate, both in the first and second quarter, which means we're able to manage the cadence and reliability of our shipments. That was possible because of our enhanced credit worthiness at the end of the first quarter.

Speaker Change: Yeah and to build on that a little bit as we talk about some of the dynamicism of the industry.

I have a slide on this in particular, but what we've seen has been encouraging as the flywheel effective.

Speaker Change: We were able to conduct what we call FLB sales at warehouse, which again, are a whole mark of trustworthiness and reliability between sigma and its clients, when we transfer ownership of material at board to its final client before we board the ship, which again is another operational milestone rarely achieved by a company that's just one year old.

Speaker Change: The next page has a color coding because it just highlights two different moments in our one year history.

Speaker Change: Lower prices stimulating demand in other markets and I think we've seen a number of market commentators talk about the strength in energy storage in the last quarter or two and Tesla Mega pack numbers over the last <unk> resolve kind of reflect the improved economics of energy storage projects as prices for batteries fall and that's.

Ana Cabral: We've seen a number of market commentators talk about the strength in energy storage the last quarter or two, and Tesla's megapack numbers over the last two Q results kind of reflect the improved economics of energy storage projects as prices for batteries fall. Economics, Cheering Economics.

Speaker Change: Again, we are now a season producer.

Speaker Change: Kind of economics hearing economics of it here as it relates to what we see on more of a micro level and then I had mentioned earlier.

Ana Cabral: As it relates to what we see on more of a micro level, as Ana had mentioned early on, right, we don't control lithium prices, and the market is obviously working its way through a bit of oversupply over the last 12 months. But what we have also is a seasonality that's increasingly present in the market. What you see on the top of the slide here represents Chinese production growth of lithium chemicals. The growth primarily, as we've discussed over time, occurs in the summer, and Ed's in the winter.

Matthew DeYoe: As it relates to what we see on more of a micro level, and then I had mentioned earlier on, right, we don't control lithium prices, and the market is obviously working its way through a bit of oversupply over the last 12 months. But what we have also is a seasonality that's increasingly present in the market. What you see on the top of the slide here represents Chinese production growth with the chemicals. The growth primarily, as we've discussed over time, occurs in the summer, in edge in the winter. It's not to say the Chinese production growth is not growing year over year; it is, and we see that, and that's obvious in all the data points.

Speaker Change: We demonstrate shipment by shipment on this page that we have this cadence and reliability of consistently shipping 22,000 tons at every 30 to 35 days, which drive our export credit lines, increasingly more favorable firms and rates.

Speaker Change: We don't control lithium prices and the market is obviously working its way through.

Speaker Change: A bit of oversupply over the last 12 months, but we have also is the seasonality that's increasingly present in the market. What you see on the top of the slide here represents Chinese production growth with them chemicals the growth primarily as we've discussed over time occurs in.

Speaker Change: And again, it underpins our commercial independence and commercial assertiveness.

Speaker Change: The color coding demonstrates this evolution of our commercial strategy. In other words, we've gone from the first six months where we had a counterparty trader that was the principal, moved into where we are today, where there are very forms of exercise and assertiveness, selling to end users, selling to counterparty trading agencies, but trading companies as agents.

Ana Cabral: The next phase, is essentially talked a bit about the market and gives a bit of color of the way we're seeing things. And I want to share that page with Matthew based. I'll comment on this slide and then Matthew comment on a few other slides. So share the section with my partner here. This first slide, I'll cover that one. Essentially, it's pretty clear to all participants in the supply chain that the growth engine of electric vehicles this year is China.

Speaker Change: And up again, this last shipment, this was kept, this one year was kept by sending the last shipment to Mitsubishi, which is a very large industrial cadet.

Speaker Change: Summer and edge in the winter, it's not to say the Chinese production growth is not growing year over year. It is and we see that and that's obvious and all of the data point, but from a market impact perspective, we know that seasonal supply ramps in the spring and summer at the same time when early buying pattern takes a dip.

Ana Cabral: It's not to say that Chinese production growth is not growing year over year, it is. And we see that and that's obvious in all the data points. But from a market impact perspective, we know that seasonal supply ramps in the spring and summer, at the same time when early buying pattern takes a dip and starts to then pick up later with the big pull into the Q4 EV cycle, which kind of has consistently occurred year after year, particularly in the fourth year.

Ana Cabral: But from a market impact perspective, we know that seasonal supply ramps in the spring and summer. At the same time, when early buying pattern takes a dip and starts to then pick up later with the big pull into the Q4 EV cycle, which kind has consistently occurred year after year, particularly in the fourth few. So, as Anna had mentioned, being in a commercially flexible position to take advantage of these buying and selling windows is exactly where we need to be, which, as we've hit a number of times. It's exactly a function of building on our cadence, establishing ourselves as a reliable and consistent supplier to the market, and leaving the rewards of that over time.

Speaker Change: So in Japan, they just associated to tell two other automakers for easy strategy and easy development.

Ana Cabral: China is delivered almost 40% growth in the year, in out in electric vehicles all in like BVV sales. And China's bounds to reach 60% of the global EV market by the end of the year, overtaking Europe. Which means that China has, which is a result actually of a consistent policy making, of consistent policy making exercise over the last decade when China has enacted a very successful EV growth subsidy program. And when you think about it, and again, just to think about it, in 2019, EV sales in China were about 3% of total car sales.

Speaker Change: It starts to then pick up later with the big pull into the Q4, <unk> cycle, which kind of has consistently occurred year after year, particularly in the fourth Q. So.

Speaker Change: So we get to strive and again, we want to also leave you here with the certainty that we're going to further enhance this case.

Speaker Change: Meaning we're targeting 60,000 tons of sales for the upcoming third quarter closing on September 30th, which is basically just 45 days away.

Ana Cabral: So, As Ana had mentioned, being in a commercially flexible position to take advantage of these buying and selling windows is exactly where we need to be, which, as we've hit a number of times, is exactly a function of building on our cadence, establishing ourselves as a reliable and consistent supplier to the market, and reaping the rewards of that over time. Exactly. And I think just to cap the slide, to look at the bottom slide, it's very important to highlight the volume line charts that represent what we call, you know, electric vehicles, new energy vehicles sold in China. If you look at the various colors, each color is the volume sold in any particular year.

John Windows: And then I had mentioned being in a commercially flexible position to take advantage of these buying as John Windows is exactly where we need to be which as we've had a number of times is exactly a function of building on our cadence to establishing ourselves as a reliable and consistent supplier in the market.

Speaker Change: Distract records that we establish allows us to basically tap into these leading global supply chains for Lithium, again going direct to downstream members of these supply chains because it's the result of this commercial flexibility.

Speaker Change: And reaping the rewards of that overtime exactly and I think just to cap. The slide if you look at the bottom slide it's very important to highlight the volume the volume line charge that represents what we call you know electric vehicles, New energy vehicles sold in China. If you look at the various colors each color is there.

Ana Cabral: Exactly, and I think just to cap this slide, to look at the bottom slide, it's very important to highlight the volume, the volume line charts that represent what we call, you know, electric vehicles, new energy vehicles, solving China. If you look at the various colors, each color is the volume, so in any particular year. So, if you look at the bottom, we start the series in 2020, and then we go to 2021, 22 all the way to now, which means a very large amount of electric cars are actually offered to the customers, offered to consumers in the same buying pattern seasonality of combustion cars.

Speaker Change: One of the other points we want to make, I mean we are pretty agnostic as far as our client base, but typically given that Asia concentrate the supply chain manufacturing today, we've been equally distributing our shipments into Japanese South Korea and Chinese clients, which is a reflection of the industry.

Ana Cabral: So if you look at the bottom, we started the series in 2020, and then we go to 21, 22, all the way to now, which means a very large amount of electric cars are actually offered to the customers, offered to consumers, in the same buying pattern seasonality of combustion cars, because consumer behavior regarding cars, regarding how their power, how their power hasn't changed, which means consumers like to buy cars in the fourth quarter, like consumers like to buy things in the fourth quarter, that's classic retail consumer purchasing pattern. Now, what does that mean for our industry? It means the following.

Speaker Change: Volumes sold in any particular year. So if you look at the bottom we start with series in 2020, and then we go into 'twenty, one 'twenty two all the way to know which means.

Speaker Change: The next page, again, is a derivative of the previous pages.

Ana Cabral: No one have taught that in 2024, just five years later, twice a year already, EV sales surpassed sales of combustion cars three or four times during this year already. We represented over 50% of overall car sold in China. It's a remarkable achievement. And at that, I will encourage you to look at this slide on the left. So the global demand is essentially despite the behavior of EV sales in the western car market, the global demand is clearly set on the path to reach 1.1 million times of LCE equivalent by the end of 2024.

Very large amount of electric cars.

Speaker Change: Our actually offered to the customers offer to consumers in the same buying patterns seasonality.

Speaker Change: You can tell on the last chart you have basically the quantification of these two different moments of commercial strategy.

<unk> combustion cars, because consumer behavior regarding cars regarding on how their power, how they're powered hasnt changed which means consumers like to buy cars in the fourth quarter like consumer like to buy things in the fourth quarter. That's classic retail consumer purchasing pattern now what does that mean for our.

Ana Cabral: Because consumer behavior regarding cars, regarding how their power, how their power hasn't changed, which means consumers like to buy cars in a fourth quarter. Like consumer like to buy things in a fourth quarter, that's classic retail consumer purchasing pattern. Now, what does that mean for our industry? It means the following: the sheer volume of materials required to deliver this significant volumes of cars in one season, which is the fourth quarter season, are no longer attainable to be stocked by the participants just once a year. And this is where the spring and fall stocking cycles emerge.

Speaker Change: First, we had the first six months and then on this page, we demonstrate where we are today.

Speaker Change: Will we continue to pre-unize or continue to increase sales price premium relative to peer-licking producers, would be maintaining an average of 10% price pre-unization today, which again are a result of this cadence, reliability of the season as a season producer, and then more importantly, the financial flexibility of our own credit and customer financing lines.

Speaker Change: Industry it means the following.

Ana Cabral: The sheer volume of materials required to deliver this significant volumes of cars in one season, which is the fourth quarter season, are no longer attainable to be stocked by the participants just once a year. And this is where the spring and fall stocking cycles emerge. The fall stocking cycle is the classic stocking cycle in all metals.

Speaker Change: The sheer volume of materials required to deliver this significant volumes of cars in one season, which is the fourth quarter season.

Ana Cabral: If China can choose just on the face it is, we're going to need 1.4 million tons of LCE equivalent just by next year. What does that mean? It means you're going to need about 8 segments, right? 8 segments to reach these numbers, which is a pretty sizable number. In other words, the market is growing annually. Now what is equivalent to the entire size of the whole market just five years ago, meaning the whole market was 200,000 tons LCE in 2019.

Speaker Change: There are no longer attainable to be stopped by the participants just once a year and this is where this spring and fall stocking.

Speaker Change: <unk> emerged default patchy stocking cycle was the classic stocking cycle No method, that's why Ele me happens in the midst of it historically, but then the screen stocking cycle.

Ana Cabral: The fall cycle stocking cycle is the classic stocking cycle, no matter what. That's why enemy happens in the midst of it, historically. But then the spring stocking cycle is emerging with a very clear pattern, as you can see in the data points mapped out and highlighted by math. Because the industry, typically the supply chain participants, do not have a strong balance sheet that would allow them to just follow the industry into one annual stocking period. So they distribute it throughout the year into spring and fall stocking cycles, because again, the sheer scale of electric cars has increased, choose dramatically over the last five years, and it hasn't been matched by consolidation in the supply chain away from batteries.

Ana Cabral: That's why LME happens in the midst of it, historically. But then the spring stocking cycle is emerging with a very clear pattern, as you can see in the data points mapped out and highlighted by Matt, because the industry typically, the supply chain participants do not have a strong balance sheet that would allow them to just follow the industry into one annual restocking or stocking period. So they distribute it throughout the year into spring and fall stocking cycles. Because again, the sheer scale of electric cars has increased too dramatically over the last five years, and it hasn't been matched by consolidation in the supply chain away from batteries.

Mac: <unk> is emerging with a very clear pattern as you can see in the data points mapped out and highlighted by Mac because the industry typically.

Mac: Supply chain participants do not have a strong balance sheet that would allow them to just follow the easy industry into one annual restocking or stocking period. So they distributed throughout the year into spring and fall stocking cycles, because again this sheer scale.

Ana Cabral: And that is the volume that is added to the market in the market, basically having only China as a local motive, which basically shows you that, you know, this market demand fundamentals are very much in there, because we never ever thought that we would see this kind of level of lithium carbon and equivalent demand back five years ago in 2025. All of you remember the first time rock you put out the 1 million ton LCE demand for 2025 in 2019. And that was the biggest bouquet of the whole industry. Well, now that's our reality. In fact, it's our fair case.

Mac: Of electric cars has increased choose romantically over the last five years and he hasn't been matched by consolidation in the supply chain away from batteries batteries are consolidated but the rest of the supply changes is it is just a small balance sheet separate set of participants.

Ana Cabral: Batteries are consolidated, but the rest of the supply chain just isn't. It's just a small balance sheet; that's a particular.

Ana Cabral: Batteries are consolidated, but the rest of the supply chain just isn't. It's just a small balance sheet set of participants. So with that, I mean, I want to come up, I want to basically close with my, my, I want to present you with my closing comments.

Ana Cabral: So with that, I mean, I want to come up, I want to basically close with my, I want to present you with my closing comments. I think up clearly; I mean, Sigma did not benefit from any of this execution in its valuations. I mean, we're still trading like a pre-operational developer company. In other words, we are now a large producer; we reach cadence; we have credit worthiness of a very large producer at, you know, 5.8% in dollars a year. But none of this is reflected in our valuation, which, you know, still kind of looks like the valuation of a developer.

Ana Cabral: I think, clearly, I mean, Sigma did not benefit from any of this execution in its valuations. I mean, we're still trading like a pre operational developer company. In other words, we are now a large producer, we've reached cadence, we have credit worthiness of a very large producer at, you know, 5.8% in dollars a year, but none of this is reflected in our valuation, which, you know, still kind of looks like the valuation of a developer.

Speaker Change: So with that I mean, I want to come up but I would basically close with my mic.

Speaker Change: Presented with my closing comments I think up clearly I mean Sigma did not benefit from any of this execution in its valuations I mean, we're still trading like a pre operational developer company.

Matthew DeYoe: So I want to just recap these numbers because sometimes we get lost in the day-to-day of the ads and flows of prices, and we forget how compelling the actual fundamentals of the industry are. Yeah, and to build on that a little bit, as we talk about some of the dynamicism of the industry, and we don't have a slide on this in particular, but what we've seen is it's been encouraging is the fly wheel effective, lower price is stimulating demand in other markets, and I think we've seen a number of market commentators talk about the strength and energy storage the last quarter or two, and Tesla's mega pack numbers over the last two-queue resolve kind of reflect the improved economics of energy storage projects as prices for batteries fall, and that's kind of economics cheering economics at that year.

Speaker Change: In other words.

Speaker Change: We are now a large producer we reached cadence we have credit worthiness of a very large producer at five 8% in dollars a year, but none of this is reflected in our valuation, which you know still kind of looks like the valuation of the developer so up essentially probably that happens because.

Ana Cabral: So, essentially, probably that happens because we ramped up over the last year, which has been one of the most complex years for the lithium markets. It's seen so much change, and it's seen so much lithium price volatility. None of this we control.

Ana Cabral: So, essentially, probably that happens because we ramped up over the last year, which has been one of the most complex years for the lithium markets. It seemed so much changed, and it seemed so much lithium-price volatility. None of this we control. But when we do control our operational performance. So, when measured against the two leading companies in our sector, clearly, no matter how you measured it, volumes for market cap, we are significantly undervalued. And we also want to take the occasion to welcome a billboard to our neighborhood, and when measured against the billboard, you can clearly see that we remain significantly undervalue.

As we ramped up over the last year, which has been one of the most.

Complex years for the mature markets. It seems so much change and it seems so much lithium price volatility none of these we control, but what we do control our operational performance. So when measured against the two leading companies in our sector.

Ana Cabral: But what we do control, our operational performance. So, when measured against the two leading companies in our sector, clearly, no matter how you measure this, volumes or market cap, we are significantly undervalued. And we also want to take the occasion to welcome Pilbara to our neighborhood.

Speaker Change: Clearly no matter, how you measured it.

Gilbert: Volumes or market cap, we are significantly undervalued and we also want to take the occasion to welcome Gilbert So our neighborhood and when measured against Bilberry can clearly see that we remain significantly undervalued and we want to combine Gilbert from taking advantage of that and joining our neighborhood.

Ana Cabral: And when measured against Pilbara, you can clearly see that we remain significantly undervalued. And we want to commend Pilbara for taking advantage of that and joining our neighborhood, acquiring lithium resources. We're very proud, very proud of you joining our emerging lithium valley territory. And we want to, you know, welcome to Brazil, essentially.

Ana Cabral: And we want to command the billboard from taking advantage of that and join our neighborhood acquiring Latin resources. We're very proud, very proud of you joining our emerging lithium valley territory. And we want to welcome to Brazil, essentially.

Matthew DeYoe: The growth primarily, as we've discussed over time, occurs in the summer, in edge in the winter. It's not to say the Chinese production growth is not growing year over year it is, and we see that, and that's obvious in all the data points. But from a market impact perspective, we know that seasonal supply ramps in the spring and summer. At the same time, when early buying pattern takes a dip and starts to then pick up later with the big pull into the Q4 EV cycle, which kind of has consistently occurred year after year, particularly in the fourth few.

Gilbert: Acquiring licensing resources, we're very proud very proud of you joining our emerging lithium valley territory, and we want to welcome to Brazil essentially.

Ana Cabral: And the next slide basically shows our transformation, right? We have become, we've gone from a construction site, that's what we were back in January 2023, to an industry leader. So we delivered on every single operational aspect that we had set ourselves to deliver to our shareholders.

Ana Cabral: And the next slide basically shows our transformation, right? We have become, we've gone from a construction site. That's what we were back in January 2023 to an industry. So we delivered on every single operational aspect that we had set ourselves to deliver to our shareholders. And from completing construction to completing the commissioning of the Module 3, which is the first and only dry stacking module in the entire industry, we have basically delivered on every metric. Just now, this quarter, we initiated face to earthworks construction. We now also hit our annual cost guidance ahead of schedule, way ahead of schedule.

Gilbert: And the next slide basically shows our transformation right.

Gilbert: We have because we've gone from a construction side, that's where we were back in.

Speaker Change: Because that allows us to navigate what we call these cycles in a cycle, meaning the purchase cycle of the spring and fall that takes place in this industry, which allows us to sell into the purchase cycle and therefore achieve the price pre-unization.

Gilbert: January 2023 to an industry either so we delivered on every single operational aspect that we had set ourselves to deliver.

Ana Cabral: I mean, from completing construction to completing the commissioning of the module three, which is the first and only dry stacking module in the entire industry, we have basically delivered on every metric. Just now this quarter, we initiated phase two earthworks construction. We now also hit our annual cost guidance ahead of schedule, way ahead of schedule. So we're printing the costs in our financial statements that we guided earlier in the year. So I think the next step here, the next stop in our sequence of deliveries will be commissioning phase two, which will happen, you know, a year from now. So again, we want to thank you for the trust. We want to thank you for believing in us.

Speaker Change: So we are now able to start to monetize gradually what turns out to be a chemically superior quality of our quintuple zeroly to concentrate.

Matthew DeYoe: So, as Anna had mentioned, being in a commercially flexible position to take advantage of these buying and selling windows is exactly where we need to be, which as we've hit a number of times. It's exactly a function of building on our cadence, establishing ourselves a reliable and consistent supplier to the market, and leaving the rewards of that over time. Exactly, and I think just to cap this slide, to look at the bottom slide, it's very important to highlight the volume, the volume line charts that represent what we call, you know, electric vehicles, new energy vehicles, solving China.

Gilbert: To our shareholders it means from.

Gilbert: Completing construction to completing the commissioning of the module three which is the first and only dry stacking module in the entire industry.

Speaker Change: And at that, we turn to the next page where we basically numerically demonstrate that this high quality is what drives bringing pricing.

Gilbert: We have basically delivered on every metric just now this quarter, we initiated phase II earthworks construction.

Speaker Change: But more importantly, is a win-win situation for our customers because our customers save significantly if they acquire our product, even at a premium price versus the product of our competitors. In other words, our high quality is chemically measured and it translates into this cost savings for our customers and their supply chains. So via tons of our product from sigma means that the client saves approximately 20 to 30% in raw materials when refining lithium hydroxide chemicals, everything else staying the same.

Gilbert: Now also hit our annual cost guidance ahead of schedule way ahead of schedule. So we're printing the costs in our financial statements that we guided earlier in the year.

Ana Cabral: So we're printing the costs in our financial statements that we guided earlier in a year. So I think the next step here, the next stop in our sequence of deliveries will be commissioning phase two, which will happen, you know, a year from now.

Speaker Change: So it's a gradual process for us to simply grab that, to simply monetize the portion of that, leaving another portion for the customer in a full win-win relationship.

Matthew DeYoe: If you look at the various colors, each color is the volume so in any particular year. So, if you look at the bottom, we start the series in 2020, and then we go to 2021, 22 all the way to now, which means a very large amount of electric cars are actually offered to the customers, offer to consumers in the same buying pattern seasonality of combustion cars. Because consumer behavior regarding cars, regarding how their power, how their power hasn't changed, which means consumer like to buy cars in a fourth quarter.

Gilbert: So I think the next step here. The next stop in our sequence of deliveries will be commissioning phase two which will happen.

Speaker Change: The next page talks a bit about the operational improvement that we have been able to affect in our green plant over the last year.

Gilbert: A year from now so again, we want to thank you for the trust we want to thank you for believing in us.

Ana Cabral: So again, we want to thank you for the trust. We want to thank you for believing in us. We believe that this, you know, renewed wave of investments in Mitchel Valley just corroborates what we've been saying: that we're operating one of the most fantastic jurisdictions for critical minerals and industrial battery materials in the world, given the overall operating circumstances of our country. And we are committed to continuing to deliver to all of the shareholders throughout, you know, the next quarters ahead of us.

Speaker Change: We believe that this renewed wave of investments in mission Valley, just corroborate what we been saying that we're operating one of the most fun tactic.

Ana Cabral: We believe that this, you know, renewed wave of investments in Lithium Valley just corroborates what we've been saying, that we're operating one of the most fantastic jurisdictions for critical minerals and industrial battery materials in the world, given the overall operating circumstances of our country. And we are committed to continuing to deliver to all of the shareholders throughout, you know, the next quarters ahead of us. So I want to close this up, just moving to the Q&A.

Speaker Change: Two resection score critical minerals.

Speaker Change: Industrial battery materials in the world given the overall.

Matthew DeYoe: Like consumer like to buy things in a fourth quarter, that's classic retail consumer purchasing pattern. Now, what does that mean for our industry? It means the following, the sheer volume of materials required to deliver this significant volumes of cars in one season, which is the fourth quarter season, are no longer attainable to be stocked by the participants just once a year. And this is where the spring and fall stocking cycles emerge.

Speaker Change: Operating circumstances of.

Speaker Change: Our country and we are committed to continuing to deliver.

Speaker Change: All of the shareholders throughout the next quarters ahead of us.

Speaker Change: Yes.

Unknown Executive: So I want to close this up, just moving to the Q&A.

Speaker Change: So I want to close this up just moving to the Q&A, yes.

Ana Cabral: Yeah, so Regina, I'm happy to move to Q&A. At this time, if you'd like to ask a question, simply press star followed by the number one on your telephone keypad and our first question will come from the line of Steve Byrne with Bank of America. Please go ahead. Yeah, thank you. Good morning.

Unknown Executive: Yes, so Regina, happy to move to Q&A from here. At this time, if you'd like to ask a question, simply press star, followed by the number one on your telephone keypad.

Speaker Change: Uh huh.

Speaker Change: Happy to move to Q&A from here.

Speaker Change: At this time, if you'd like to ask a question simply press star followed by the number one on your telephone keypad and our first question will come from the line of Steve Byrne with Bank of America. Please go ahead.

Matthew DeYoe: The fall cycle stocking cycle is the classic stocking cycle, no matter what, that's why enemy happens in the midst of it, historically. But then the spring stocking cycle is emerging with a very clear pattern, as you can see in the data points mapped out and highlighted by math. Because the industry, typically the supply chain participants do not have a strong balance sheet that would allow them to just follow the industry into one annual stocking period.

Steve Byrne: And our first question will come from the line of Steve Byrne with Bank of America. Please go ahead. Yeah, thank you. Good morning. You're your slide nine that shows your monthly pricing year to date. Is that 953 you show in areas that is that the month to date average for August or is that is that July? But much more importantly, I am curious if you're seeing any signs of price inflection. Or do you do you see it stabilizing down there any any any signs that things could tighten? And you know, I appreciate your comments about, you know, the world's going to need six sigma's for next year, you know, just given demand growth.

Steve Byrne: Your slide nine that shows your monthly pricing year to date, is that 953 you show in there is that is that the the month to date average for August or is that is that July? But much more importantly, I am curious if you're seeing any sign, of price inflection, or do you see it stabilizing down there? Any signs that things could tighten?

Steve Byrne: Yes. Thank you good morning, your slide nine that shows your monthly pricing year to date is.

Steve Byrne: Is that 953, you're showing there is that is that the month to date average for August or so.

Steve Byrne: July.

Speaker Change: But much more important.

Speaker Change: Shortly.

Speaker Change: Im curious if youre seeing.

Speaker Change: Any signs.

Speaker Change: Of price inflection.

Matthew DeYoe: So they distribute it throughout the year into spring and fall stocking cycles, because again, the sheer scale of electric cars has increased, choose dramatically over the last five years, and it hasn't been matched by consolidation in the supply chain away from batteries. Batteries are consolidated, but the rest of the supply chain just isn't. It's just a small balance sheet, that's a particular.

Speaker Change: Or do you see it stabilizing down there any.

Speaker Change: Any signs that things could tighten and.

Steve Byrne: And, you know, I appreciate your comments about you know, the world's going to need. Six Sigmas for next year, you know, just given demand growth, but there is a lot of excess inventory in China. Do you have a view that if the industry doesn't? Little Wop [inaudible] It doesn't seem like it is.

Speaker Change: I appreciate your comments about you know.

Speaker Change: The world's going to need.

Six Sigma <unk> for next year.

Speaker Change: Just given demand growth, but there is a lot of excess inventory in China.

Steve Byrne: But there is a lot of excess inventory in China. Do you have a view that if the industry doesn't slow operating rates? Which it doesn't seem like it is. Do you have a view on, you know, when this inflection might occur? If you're not seeing it yet, is it just seasonality that will drive that? I welcome your thoughts on this.

Speaker Change: Have a view that if the industry doesn't.

Speaker Change: Slow operating rigs, which it doesn't seem like it is do you have a view on when.

Ana Cabral: So with that, I mean, I want to come up, I want to basically close with my, I want to present you with my closing comments. I think up clearly, I mean, Sigma did not benefit from any of this execution in its valuations. I mean, we're still trading like a pre-operational developer company. In other words, we are now a large producer, we reach cadence, we have credit worthiness of a very large producer at, you know, 5.8% in dollars a year.

Steve Byrne: Do you have a view on when this inflection might occur if you're not seeing it yet? Is it just seasonality that will drive that? I welcome your thoughts. Yes, Steve, I guess I'll start the, The data point you see there just reflects the value for our August float, which we press released the other day. It's a single data point in time, not meant to be the average realized price for that. I think your point, and I'll let Ana talk broadly about science in the market, but any, I think if you follow some of the comments from our public peers, I think what you see is a situation where a vast majority of our peers in Australia and Canada and other markets are underwater at current economics, and we know that's not sustainable.

Speaker Change: When this inflection might occur if you're not seeing it yet is it just seasonality that will drive that I welcome your thoughts on this.

Matthew DeYoe: Yes, Steve. I guess I'll start the. The data point you see there just reflects the value for August. So, which we press least the other day, it's a single data point in time. Not meant to be the average realized price for that specific quarter. I think your point, and I'll let Anna talk for all the about signs from the market. But I mean, I think if you follow some of our comments from some of the comments from our public peers, I think what you would see is a situation where a vast majority of our. The vast majority of our peers in Australia and Canada and in other markets are under water at current economics, and we know that's not sustainable.

Speaker Change: I guess I will start the <unk>.

Speaker Change: The data point, you see Theyre just reflects the value for our August 4th.

Speaker Change: <unk>.

Speaker Change: The press release the other day, it's the single data point in time is not meant to be.

Speaker Change: The average realized price for that specific quarter.

Speaker Change: Quarter.

Speaker Change: Your point and I'll, let Anna talked broadly about time to market, but I mean.

Ana Cabral: But none of this is reflected in our valuation, which, you know, still kind of looks like the valuation of a developer. So, essentially, probably that happens because we ramped up over the last year, which has been one of the most complex years for the lithium markets. It seemed so much changed, and it seemed so much lithium-price volatility. None of this we control. But when we do control our operational performance. So when measured against the two leading companies in our sector, clearly, no matter how you measured it, volumes for market cap, we are significantly undervalued.

I think if you follow some of our comments from some of the comments from our public peers, I think which you will see is a situation where a vast majority of our.

Speaker Change: The vast majority of our peers in Australia, and Canada and other markets are are underwater at current economics, and we know that's not sustainable.

Ana Cabral: It's always hard to tell when that specifically pays out from a supplier perspective, but if you can just look at some of the recorded numbers that we've seen in some of the discussions we have on cost targets, particularly from traceable sources. We know that a number of, a number of players out there are a bit upside down, and I don't have to. Yeah, it goes back to traceability. This truck kind of said it all. I mean, you have a finite universe of producers in Australia, Canada, Brazil, Chile, Argentina that can deliver what we call traceable supply.

Steve Byrne: It's always hard to tell when that specifically pays out from a supplier perspective, but if you can just look at some of the reported numbers that we've seen and some of the discussions we have on cost targets, particularly from traceable sources. We know that a number of players out there are a bit upside down, and I'll pass it to you.

Speaker Change: It's always hard to tell when that specifically phase out from a supplier perspective, but.

Speaker Change: If you can just look at some of the reported numbers that we've seen in some of the discussions we have on cost.

Speaker Change: Targets, particularly from traceable sources.

Ana Cabral: And we also want to take the occasion to welcome a billboard to our neighborhood, and when measured against the billboard, you can clearly see that we remain significantly under value. And we want to command the billboard from taking advantage of that and join our neighborhood acquiring Latin resources. We're very proud, very proud of you joining our emerging lithium valley territory. And we want to welcome to Brazil, essentially.

Speaker Change: We know that.

A number of a number of players out there a bit upside down.

Ana Cabral: Yeah, it goes back to traceability. This chart kind of says it all. I mean, you have a finite universe of producers in Australia, Canada, Brazil, Chile, Argentina, that can deliver what we call traceable supply. And traceable really means a very low bar of human rights adherence, no child labor. We're not talking zero carbon here, right? Now, that is actually the issue, because as you can see, there's a gap between supply and demand at these price levels.

Speaker Change: Yes. It goes back to traceability. This chart kind of says it all I mean, you have a finite universe of producers in Australia, Canada, Brazil, Chile, Argentina that can deliver what we call traceable supply and traceable really needs a very low bar of like.

Speaker Change: I mean, we're very proud of this because we keep them perfecting this plant in the continues effort.

Ana Cabral: And traceable really means a very low bar of like human rights adherence, no trial labor. We're not talking zero copy here right now; that is actually the issue because, as you can see, there's a gap between supply and demand at these price levels. But there are players; they're selling into this gap because they seem to have the cost structure to expand it. And based on the data of product inflow from Africa mainly, we're led to believe that this gap today with prices where they are has been mainly filled with what we call untraceable. materials. So this industry is now at a crossroads because you will have to collectively decide what kind of materials you want to use to build their sustainable green cars.

Speaker Change: And as you recall, it started with the dry stacking. A year ago, we were barely finishing commissioning the dry stacking, which has been a centerpiece of our overall purpose as a company to deliver the most sustainable lithium materials in the world, which meant for us not to produce a tailings down, which means we dry stack our fines and our ultra-fines produced by the green pack plant. That means we're also able to maintain minimum levels of water usage, because we reuse all that water, which in our case comes from sewage.

Human rights at the year end no child labor, we're not talking zero carbon here right now that is actually the issue because as you can see there's a gap between supply and demand at these price levels, but there are players they are selling into this gap because they seem to have the cost structure to withstand it.

Speaker Change: Now, those operational improvements translate into decreasing the shipment intervals between each boat. So the target is to get 30 to 35 days driving maximum efficiency of the plant and reducing the shipment intervals.

Speaker Change: And this is kind of how we are going to get to our annual guidance.

Speaker Change: Now, within the green pack GMS, we again have been affecting further adjustment and further per-sacking display on.

Ana Cabral: But there are players, they're selling into this gap, because they seem to have the cost structure to withstand it. And based on the data of product inflow from Africa, mainly, we're led to believe that this gap today, with prices where they are has been mainly filled with what we call untraceable, So this industry is now at a crossroads because you will have to collectively decide what kind of materials you want to use to build their sustainable green cars.

Speaker Change: And based on the data.

Speaker Change: Essentially, we have been able to reprocess the fines that were generated in the early commissioning period, which have high grade. They have a lithium oxide grade of about 1.5%. So that means we are benefiting from a double whammy here, where the improvements in the circuit increase daily productivity. So we have higher recovery and higher daily production, but we also utilize that circuit to concentrate material, that if we didn't drive that would be otherwise left inside of tailings.

Speaker Change: Inflow from Africa, mainly were led to believe that this gap today with prices, where they are has been mainly field with what we call untraceable materials. So this industry is now at a crossroads because you won't have to collectively decide what kind of materials.

Speaker Change: So by recycling material that had zero cost, because it was just essentially tailings, but we had drive acted, we are able to gradually increase our throughput of high period, typical zero lithium concentrate.

Ana Cabral: Just now this quarter, we initiated face to earthworks construction. We now also hit our annual cost guidance ahead of schedule, way ahead of schedule. So we're printing the costs in our financial statements that we guided earlier in a year. So I think the next step here, the next stop in our sequence of deliveries will be commissioning phase two, which will happen, you know, a year from now.

Speaker Change: Q1 two.

Speaker Change: Use to build their sustainable Green cars I mean, if the industry decides that he said it's acceptable to use materials that infringe human rights and child Labor rules and basic traceability rules to build green electric cars and sustainable electric.

Speaker Change: So some of these results of this continuing improvement have already been reflected in our third quarter performance.

Ana Cabral: I mean, if the industry decides that it's an it's, acceptable to use materials that, you know, infringe human rights and child labor rules and basic traceability rules to build green electric cars and sustainable electric cars. And if the industry believes that as the penetration rate increases, consumers are going to accept that, well, I think we're going to go in a certain path. But our personal view is that these traceability standards are going to continue to be highly enforced, especially by industry players.

Ana Cabral: I mean, if the industry decides that it's acceptable to use materials that, you know, in fringe human rights and child able rules and basic traceability rules, to build green electric cars and sustainable electric cars. And if the industry believes that, as the penetration rate increases, consumers are going to accept that, well, I think we're going to go in a certain path. But our personal view is that these traceability standards are going to continue to be highly enforced, especially by industry players. And I mean across the board, Chinese battery makers, South Korean battery makers, Japanese battery makers, that do deliver their materials into the, you know, top not supply chains into the leading supply chains in the world.

Speaker Change: Hence the guidance, robust guidance of 60,000 tons of lithium materials to be shipped in the third quarter that we plan to hit, just resulting from the work we've already done.

Speaker Change: And I think lastly, regarding the crusher, we keep on playing around with new flow sheets for the crusher, which again, help us increase the efficiency.

Speaker Change: <unk> ended the industry believes that as the.

Speaker Change: So the latest changing flow sheet is that we're going to create a new setup, which is aligned with basically the best cross designed in the world that separates screens from the motor.

Ana Cabral: So again, we want to thank you for the trust. We want to thank you for believing in us. We believe that this, you know, renewed wave of investments in Mitchel Valley just corroborates what we've been saying that we're operating one of the most fantastic jurisdictions for critical minerals and industrial battery materials in the world, given the overall operating circumstances of our country. And we are committed to continuing to deliver to all of the shareholders throughout, you know, the next quarters ahead of us.

Speaker Change: Penetration rate increase as consumers are going to accept as well.

Speaker Change: Again, improving crusher efficiency and benefiting from the customized crusher we created at once, which has 1,200 milliliters of drop crusher openings, which means last fines, which means higher yields, which means higher productivity.

Speaker Change: I think we're going to go into a certain path, but our personal view is that these traceability standards are going to continue to be highly enforced, especially by industry players and I mean across the board our Chinese battery makers, South Korean battery makers Japanese bank with me.

Speaker Change: So that's what it all means.

Ana Cabral: And I mean across the board, Chinese battery makers, South Korean battery makers, Japanese battery makers that do deliver their materials into the top-notch supply chains, into the leading supply chains in the world. So we believe that over time, you're going to see a movement where untraceable material either complies and becomes traceable, or it just disappears from at least the EV battery supply chain altogether. And what fraction of global supply Ana would you say is untraceable? And is that happens to be higher on the cost curve? No, that's the whole point. The untraceable material in this current environment is coming from low cost producers.

Chris: Chris do deliver their materials into the.

Chris: Top notch supply chain into the leading supply chains in the world. So we believe that over time, you're going to see a movement, where untraceable material, either complies and becomes traceable or it just disappears from the battery supply chain.

Speaker Change: The crease cadence is a result not of one great change, but of a myriad of improvements on this plant that actually needs to our higher confidence that will be hitching 60,000 tons of lithium concentrate sales in the third quarter.

Ana Cabral: So we believe that over time, you're going to see a movement where untraceable material either complies and becomes traceable, or it just disappears from LED battery supply chains altogether. And what fraction of global supply in it would you say is untraceable, and is that happened to be higher on the cost curve? No, that's the whole point. The untraceable material in this current environment is coming from low-cost producers. There's now, I think we've been seeing this quite a while in the market, but now the industry has a whole caught up with it. If you look at production inflows, there's been a whole segment coming out of a single African country just now.

Speaker Change: So with that, I'll hand over to my partner, Matt Dejo, to go over our financial highlights.

Unknown Executive: So I want to close this up, just moving to the Q&A. Yes, so Regina, happy to move to Q&A from here.

Speaker Change: Thank you.

Chris: Altogether.

Matthew DeYoe: At this time, if you'd like to ask a question, simply press star, followed by the number one on your telephone keypad. And our first question will come from the line of Steve Byrne with Bank of America. Please go ahead. Yeah, thank you. Good morning. You're your slide nine that shows your monthly pricing year to date. Is that 953 you show in areas that is that the month to date average for August or is that is that July?

Chris: Yeah.

Speaker Change: What fraction of global supply into would you say is on traceable and as that happens to be higher on the cost curve.

Chris: No.

Chris: That's the whole point the untraceable material in this current environment is coming from low cost producers. There's now I think we've been seeing this quite a while in the market, but now the industry as a whole caught up with it. If you look at production inflows, there's been a home's thinking about coming out of a single African country, just now so clear.

Matt Dejo: So, in the second quarter, we reported revenues of $45.9 million on nearly $53,000 ton sold, which implies a CIA equivalent realized price to quarter about $89, or $894 ton.

Ana Cabral: There's now, I think, we've been seeing this quite a while in the market, but now the industry as a whole caught up with it. If you look at production inflows, there's been a whole stigma coming out of a single African country just now. So clearly, there isn't an industrial facility of the standards that we have delivered in that one country. So it's artisanal production of lithium. Again, lithium is not rare.

Matt Dejo: The top line was supported by strong cross management, which we'll get into in a moment.

Matthew DeYoe: But much more importantly, I am curious if you're seeing any signs of price inflection. Or do you do you see it stabilizing down there any any any signs that things could tighten? And you know, I appreciate your comments about, you know, the world's going to need six sigma's for next year, you know, just given demand growth. But there is a lot of excess inventory in China. Do you have a view that if the industry doesn't slow operating rates?

Ana Cabral: So clearly, there isn't an industrial facility off the standards that we have delivered in that one country. So it's artisanal production of lithium. Again, lithium is not rare. So because lithium is everywhere, I think it puts an extra burden on automakers to enforce traceability and enforce sustainability because, again, just like what happened to cobalt, like what happened to tantalum before, all the way to blood diamonds, the risk is to basically kill the chicken, the lady, go to the mat. This consumer is kind of, you know, turning, you know, let's say resistant towards these cars because they'll be challenging their own sustainability resulting from the, let's say, traceability materials that go in building those cars.

Speaker Change: There isn't an industrial facility of the standards that we have delivered in that one country. So its our seasonal production at Blitz Mccann lithium is not rare. So because lithium is everywhere I think it puts an extra burden on alpha makers to enforce traceability and enforce sustainability because again just.

Ana Cabral: So because lithium is everywhere, I think it puts an extra burden on automakers to enforce traceability and enforce sustainability. Because again, just like what happened to cobalt, like what happened to tantalum before, all the way to blood diamonds, the risk is to basically kill the chicken to lay the golden eggs. If consumers kind of, you know, turning, you know, let's say resistant towards these cars, because they'll be challenging their own sustainability resulting from the, let's say, traceability of the materials that go in building those cars. And we've been very vocal about that because this is the kind of behavior that risks the entire supply chain for all of us, and you've seen what happened to Cobalt before. Thank you.

What happened to cobalt like what happened to tantalum before.

Speaker Change: All the way to Black Diamond the riskiest, you basically kill the chicken delay the goals and that is as consumers kind of.

Speaker Change: Turning.

Speaker Change: Let's say resistant towards these cars because it'll be challenging it's their own sustainability.

Matthew DeYoe: Which it doesn't seem like it is, do you have a view on, you know, when when this inflection might occur? If you're not seeing it yet, is it just seasonality that will drive that? I welcome your thoughts on this. Yes, Steve. I guess I'll start the. The data point you see there just reflects the value for August. So, which we press least the other day, it's a single data point in time.

Speaker Change: Resulting from the let's say.

Traceability of the materials that go in building those cars and we've been very vocal about that because this is the kind of behavior are there risks the entire supply chain for all of us and you've seen what happened to go about before.

Ana Cabral: And we've been very vocal about that because this is the kind of behavior that risks the entire supply chain for all of us. And you've seen what happened to cobalt before.

Matt Dejo: But our F.O.B, cash operating margins came in at about 54%, while adjusted cash, but down margins were close to the 30%.

Matt Dejo: Production on the quarter, total just over 49,000 tons.

Unknown Executive: Thank you.

Ana Cabral: And if I can just squeeze one in the technology that you, the technology that you, you know, implemented to, to recover more lithium out of your, the fines, is this something that you had, you know, had anticipated in the past and just implemented or was this just from your engineers figuring out a way to recover that? Does it have any impact on what you would view as your production capacity because of this?

Speaker Change: Thanks, and if I can just squeeze one in their technology.

Unknown Executive: And if I can just squeeze one in, the technology that you implemented should to recover more lithium out of your finds. Is this something that you had, you know, had anticipated in the past and just implemented, or was this just from your, from your engineers figuring out a way to recover that? Has it had any impact on what you would view as your production capacity because of that? It does. Because ultimately, I mean, it's not anything, let's say, exceptional that we've done. What we've done is the following. This media separation method is one that's constrained by the capacity of the concentrator, the centrifugator, which in our case is 250 tons an hour, 800%; but the design capacity is 237 tons an hour.

Speaker Change: Technology that.

Matt Dejo: The company has spent energy, sorry, I'll go to the next slide here.

Matthew DeYoe: Not meant to be the average realized price for that specific quarter. I think your point and I'll let Anna talk for all the about signs from the market. But I mean, I think if you follow some of our comments from some of the comments from our public peers, I think what you would you see is a situation where a vast majority of our. The vast majority of our peers in Australia and Canada and in other markets are under water at current economics and we know that's not sustainable.

Speaker Change: Technology that you have.

Speaker Change: Implemented.

Speaker Change: To recover more lithium out of out of your defined.

Speaker Change: The company has spent energy familiarizing investors with the implications of provisional price adjustments, particularly with the first few boats that shipped, and we did not have any offsetting settlements.

Speaker Change: Is this something that you had you know had.

Speaker Change: We have taken steps to harmonize our even-dom margins to balance out this volatility. What you're seeing on the left is an allocation of even-dom margins for our business, assuming boats settled accurately without these provisional adjustments. The full breakdown of this math can be found in the appendix, but the message here is underlying margins for the business are far more stable than what the headlines would indicate.

Speaker Change: Supported in the past and just.

Speaker Change: Implemented or was this just from your Premier engineers figuring out a way to recover that does it have any impact on what you would view as your as your production capacity because of the book.

Speaker Change: As the extreme market volatility is second half 23, it slows, and we establish a regular shipping cadence.

Speaker Change: Okay.

Ana Cabral: It does, because ultimately, I mean, it's not anything, let's say, exceptional that we've done. What we've done is the following. The dense media separation method is one that's constrained by the capacity of the concentrator, the centrifugator, which in our case is 250 tons an hour at 100%, but the design capacity is 237 tons an hour.

Speaker Change: It does because ultimately it's not anything let's say.

Speaker Change: We expect these headlines to subside, and ultimately revert as we come back from market route.

Matthew DeYoe: It's always hard to tell when that specifically pays out from a supplier perspective, but if you can just look at some of the recorded numbers that we've seen in some of the discussions we have on cost targets, particularly from traceable sources. We know that a number of, a number of players out there are a bit upside down and I don't have to. Yeah, it goes back to traceability. This truck kind of said it all.

Speaker Change: <unk>, although we've done what we've done is the following.

Speaker Change: The dense media separation method if it.

Speaker Change: Is one that's constrained by the capacity of the concentrator disinterested gaiter, which in our case is 250 ton.

Speaker Change: On the right side of the slide, you would see in our F.O.B, margins, which is the assessed balance out against peers, with Sigma happily finding its way towards the upper end of echelon of costs.

Speaker Change: Now we're at 100%, but the design capacity is 237 tons an hour. So that's a constraint so even if I lower my lithium oxide grades I'm still constrained by debt capacity. They can only flow that tonnage of product per hour.

Ana Cabral: So that's a constraint. So even if I lower my lithium off by grade, I'm still constrained by that capacity. I can only flow that tonnage of product per hour. So this is a characteristic of my industrial plant, the green type plant. Now, what have we learned? We learned that the higher the quality of the pre-feed into the centrifugator into the dense media separator, the higher our recovery. So what we're doing is a very elaborate system of screens and pre-screening and preparation of the feed that goes into that capacity, which unfortunately is fixed. It can already increase with an expansion.

Ana Cabral: So that's a constraint. So even if I lower my lithium oxide grade, I'm still constrained by that capacity. I can only flow that tonnage of product per hour. So this is a characteristic of my industrial plant, the green tech plant. Now, what have we learned? We learned that the higher the quality of the pre-feed into that centrifugator, into the dense media separator, the higher our recovery. So what we're doing is a very elaborate system of screens and pre-screening and preparation of the feed that goes into that capacity, which unfortunately is fixed, it can only be increased with an expansion, so that I increase recovery. So I increase yield. By feeding better material, pre-purified, pre-screened material, I am able to achieve better results in the dense media separation.

Speaker Change: This is predicated on the hard work that I will discuss here.

Speaker Change: I'm quite pleased to be presenting the cost-wide to you this morning.

Speaker Change: As the company has been able to achieve broadly, our union cash cost guidance ahead of schedule.

Matthew DeYoe: I mean, you have a finite universe of producers in Australia, Canada, Brazil, Chile, Argentina that can deliver what we call traceable supply. And traceable really means a very low bar of like human rights adherence, no trial labor, we're not talking zero copy here right now that is actually the issue because as you can see, there's a gap between supply and demand at these price levels. But there are players, they're selling into this gap because they seem to have the cost structure to expand it.

Speaker Change: This is a characteristic of my industrial plant the Green tax now what have we learned we learned that the higher the quality of the pre feed into destin, Tricia Gator into the dense media separation or the higher our recovery. So we'll be doing is a very elaborate system of screens and in free.

Speaker Change: Recall we have highlighted the target CIS cost of $510 per tonne, F.O.B, of $420, and plant-gate costs of $370. The numbers in front of you for 2Q represent a reduction of 22% to 24% from our 4Q reported levels, which is where we were when we issued this guidance.

Matthew DeYoe: And based on the data of product inflow from Africa mainly, we're led to believe that this gap today with prices where they are has been mainly filled with what we call untraceable, materials. So this industry is now at a crossroads because you will have to collectively decide what kind of materials you want to use to build their sustainable green cars. I mean, if the industry decides that it's acceptable to use materials that, you know, in fringe human rights and child able rules and basic traceability rules to build green electric cars and sustainable electric cars.

Speaker Change: Pre screening and preparation of the feed that goes into that capacity, which unfortunately is fixed economic decrease with an expansion.

Speaker Change: As production ramps to the second half of the year, we would expect the operating leverage to drive incremental improvements from these levels.

Ana Cabral: So that I can increase recovery. So I increase yield. By feeding better material, pre-purified pre-screened material, I am able to achieve better results in the dense media separation. That's what we're doing. And we've already gotten there. Now, we've hit the stride over 700 tons a day, which is something that in the past would have been called, you know, an exceptional day. Now, this is our regular day. And we're hoping to move that further upwards to even higher levels of daily production. So that's kind of what the depuration of the feed that goes into those centrifugators does for our production throughput for our yield.

Speaker Change: So that I could increase recoveries, so I increased yields by seeking better material pre purified pre pre screened material.

Speaker Change: While ocean freight rates are subject to change, we believe we have some room for traction here.

Speaker Change: Table to achieve better results in the dense media separation, that's what we're doing and we've already gotten there now we we've hit a stride over 700 tons, a day, which is something that in the past would have been called.

Speaker Change: This is a reflection overall of how the hard work is paid off on our cost structure and how we see ourselves stacking up globally against some of our peers.

Speaker Change: We will continue to work through this cost and product to the initiatives to drive home a better cost structure.

Ana Cabral: That's what we're doing. And we've already gotten there. Now we've hit the stride over 700 tons a day, which is something that in the past would have been called an exceptional day. Now this is our regular day, and we're hoping to move that further upwards to even higher levels of daily production, close to 800 a day. So that's kind of what this depuration of the feed that goes into those centrifugators do for our production throughput, for our yield. Thanks, Steve.

Speaker Change: An exceptional day now this is a regular day and we're hoping to move that further upwards.

Speaker Change: And this drives us to get back to exactly what Anna had talked about as it relates to building an operational culture of excellence.

Speaker Change: To even higher levels of daily production close to 800, a day. So that's kind of what does depuration of the feed that goes into those interested gators due for our production throughput for our yields.

Unknown Executive: Thanks, Dave.

Ana Cabral: We'll go to the next. Our next question will come from the line of Joel Jackson with BMO. Please go ahead. Morning, Matt.

Speaker Change: Thanks, Dave we'll go to the next one.

Unknown Executive: We'll go to the next one.

Speaker Change: And this is not our data, this is benchmarks, but I think it's a nice representation of where we think we'd set and where we are delivered.

Matthew DeYoe: And if the industry believes that as the penetration rate increases, consumers are going to accept that, well, I think we're going to go in a certain path. But our personal view is that these traceability standards are going to continue to be highly enforced, especially by industry players. And I mean across the board, Chinese battery makers, South Korean battery makers, Japanese battery makers, that do deliver their materials into the, you know, top not supply chains into the leading supply chains in the world.

Joel Jackson: Our next question will come from the line of Joel Jackson with the BMO. Please go ahead. Morning, man. And thanks for the commentary on Phase Two. So a bit of a technical question. You know, there's always a bit of dispute going on in some of the land inside where your reserve is or where the affidels replace to. If you don't get some sort of agreement there. Can you proceed on phase two, which you have to move phase two different part of the resource? What will give you confidence legally for the company due to the advanced phase two as designed on the land you want to do it?

Speaker Change: Our next question will come from the line of Joel Jackson with BMO. Please go ahead.

Joel Jackson: I'm back, and I'm going to volunteer at these two. So a bit of a technical question, and, you know, there's always a bit of dispute going on in some of the land inside where your reserve is or where the asset is for Phase 2. If you don't get some sort of agreement there. Can you proceed on phase two, would you have to move phase two to a different part of the resource?

Joel Jackson: Good morning, Matt.

Joel Jackson: And.

Speaker Change: Supreme.

Speaker Change: Excellent content in phase two.

Speaker Change: So a bit of a tanker question.

Joel Jackson: There is obviously a bit of dispute going on in some of the land inside where your reserve is or where the offset is for phase two if you don't get some sort of agreement there.

Speaker Change: The next side is a bit of the same view, though it's a waterfall to reported cocks.

Speaker Change: Can you proceed on phase two which you have to move phase two different part of the resource what will give you confidence legally for the company due to the advanced phase III as designed on the land do you want to do it.

Joel Jackson: What will give you confidence legally for the company that you can advance phase two as designed on the land you want to do it? Joel, I think there's a massive confusion on your end here regarding land disputes. What we're, what we are, the only thing that's actually in there, it's essentially an ore body that doesn't have anything to do with phase two, that sits between phase two and phase three, that's independent of those two phases, and that has nothing to do with sigma. So phase two is to the left of that ore body and is absolutely not connected to it.

Speaker Change: Again, noting we've removed much of the noise present in our initial quarters.

Matthew DeYoe: So we believe that over time, you're going to see a movement where untraceable material either complies and becomes traceable or it just disappears from LED battery supply chains all together. And what fraction of global supply in it would you say is untraceable and is that happened to be higher on the cost curve? No, that's the whole point. The untraceable material in this current environment is coming from low cost producers. There's now, I think we've been seeing this quite a while in the market, but now the industry has a whole caught up with it.

Ana Cabral: Joel, I think there's a massive confusion on your end here regarding the land dispute. What we are the only thing that's actually in there, it's essentially an or body that doesn't have anything to do with phase two. That sits between phase two and phase three. That's independent of those two phases. And that's nothing to do with Sigma. So phase two is to the laughter of that or body, and it's absolutely not connected to it. So we can go about our business irrespectively of what happened there. Now, what's the most important thing is that that area is actually controlled by me.

Speaker Change: Joe I think this there's a massive confusion on your end year regarding land disputes.

Speaker Change: What we're what we are the only thing that's actually in there. It's essentially a lower body that doesn't have anything to do with phase II that sits between phase II and phase III. That's independent of those two phases and that has nothing to do with Sigma. So phase two is to the <unk>.

Speaker Change: In internalizing our commercial efforts and keeping a focus on productivity, it's not only helped us generate revenue and cocks, but it's also helped right size our S.G, and A structure which you see on the right side.

Speaker Change: Notably, S.G, and A is down, an additional roughly 24% from the second half of 23 levels.

Speaker Change: <unk> of that ore body and is absolutely not connected to chew. It. So we can go about our business.

Speaker Change: And as this productivity plays out, we see further proof of competitive cross-position.

Ana Cabral: So we can go about our business irrespectively of what happened there. Now, what's the most important thing is that that area is actually controlled by me. So I have 51% of that area is a Brazilian corporation. So even if that were to become an issue, I would obviously resolve it favorably to Sigma. So it's a non-issue.

Speaker Change: As we've said, again, on the prior slide as it relates to the cost curve as provide a benchmark.

Speaker Change: Irrespectively of what happened there now what's the most important thing is that that area is actually controlled by me. So I have 51% of that area is a Brazilian corporation. So even if that were to become an issue I would obviously resolve it favorably to Sigma so it's a non issue so going back to it.

Speaker Change: So what does this all kind of mean?

Matthew DeYoe: If you look at production inflows, there's been a whole segment coming out of a single African country just now. So clearly, there isn't an industrial facility off the standards that we have delivered in that one country. So it's artisanal production of lithium. Again, lithium is not rare. So because lithium is everywhere, I think it puts an extra burden on automakers to enforce traceability and enforce sustainability because again, just like what happened to cobalt, like what happened to tantalum before, all the way to blood diamonds, the risk is to basically kill the chicken, the lady, go to the mat.

Ana Cabral: So I have 51 cent of that area is a Brazilian corporation. So even if that were to become an issue, I would obviously resolve it favorably.

Speaker Change: It helps drive that we consider to be a highly robust cash model.

Ana Cabral: So it's a non-issue. So, going back to it, essentially, what we are doing is just proceeding with our plan's business as usual. I mean, we got biohedral, which is phase two giant olabadi, which can be accessed by all sides. The mining concession belongs to Sigma; the overground belongs to a company that's affiliated to Sigma. So, you know, business is usual; pursuing business is usual.

Ana Cabral: So going back to it, essentially, what we are what we are doing is just proceeding with our planned business as usual. I mean, we got Barreiro, which is phase two, giant oil body, which can be accessed by all sides, of the mining concession belongs to Sigma. The overground belongs to a company that's affiliated to Sigma. So, you know, it's business as usual, proceeding business as usual. You might be referring to the noise my, let's say, former husband tried to make to create that sort of misunderstanding.

Speaker Change: So we started the quarter with $108 million in cash which we supplemented with nearly $46 million in net revenues. Cash costs on the quarter total $33 million, which again represents a reduction of nearly 12.5 million from our 3Q23 levels.

Speaker Change: Essentially what we are what we are doing is just proceeding with a planned business as usual I mean, we got bio which is phase two giant ore body, which can be accessed by all sides.

Speaker Change: Working capital did prove to be a headwind to the quarter, which was a function of two primary occurrences. Firstly, was a reduction to our payables of nearly $14.5 million.

Speaker Change: And the second was a delay in receivables associated with two of our shipments.

Speaker Change: The mining concession belongs to Sigma the over ground belongs to accompany that.

Speaker Change: Weighted to Sigma so.

Speaker Change: It's business as usual preceding business as usual you might be referring to the noise my.

Speaker Change: As for the pro-formal bridge, you can see that we've since received those payments shortly after quarter close.

Matthew DeYoe: This consumer is kind of, you know, turning, you know, let's say resistant towards these cars because they'll be challenging their own sustainability resulting from the, let's say, traceability materials that go in building those cars. And we've been very vocal about that because this is the kind of behavior that risks the entire supply chain for all of us. And you've seen what happened to cobalt before.

Ana Cabral: You might be referring to the noise my, let's say, former husband, try to make to create that sort of misunderstanding, but it's great that you raised this point because it's an opportunity for me to clear it out for all of the participants in this conference. That noise has nothing to do with Sigma. In fact, I have great news for everyone in attendance. My divorce has been declared quite a while ago. And as you can all see, I'm still here, Sigma. You hear? There's been no implication to Sigma of the declaration of my divorce, the split of the assets and, you know, business is usual for all of us.

Speaker Change: Let's say for my husband and try to make to create that sort of misunderstanding, but it's great that you raised this point because it's an opportunity for me to clear it out for all of the participants in this conference that noise has nothing to do with Sigma in fact, I have great news for everyone. In attendance my divorce has been declared.

Ana Cabral: But it's great that you raised this, because it's an opportunity for me to clear it out for all of the participants in this conference. That noise has nothing to do with Sigma. In fact, I have great news for everyone in attendance. My divorce has been declared quite a while ago.

Ana Cabral: And as you can all see, I'm still here, Sigma's still here. There's been no implication to Sigma of the declaration of my divorce, the split of the assets, and, you know, business as usual for all of us. So it was just, as Shakespeare says, much ado about nothing. But it's understandable in a divorce when one of the parties is less wealthy than the other one.

Speaker Change: A while ago and as you can all see I'm still here Sigma two here Theres been no implication to Sigma after declaration of my divorce the split of the asset.

Ana Cabral: Thank you. And if I can just squeeze one in, the technology that you implemented should to recover more lithium out of your finds. Is this something that you had, you know, had anticipated in the past and just implemented, or was this just from your, from your engineers figuring out a way to recover that? Has it had any impact on what you would view as your production capacity because of that? It does.

Speaker Change: Business as usual for all of US. So he was just as Shakespeare SaaS much they do about nothing but it's understandable in divorced when one of the parties is less wealthy than the other one.

Ana Cabral: So, you was just, as Shakespeare said, much ado about nothing. But it's understandable in, you know, divorce when one of the parties is less wealthy than the other one. Okay.

Ana Cabral: Okay, so my next question, that's a public issue here. Thanks for the answer. This is really great.

Speaker Change: Okay. So my next question I could publish here. Thanks.

Joel Jackson: So, my next question. That's published here. Thanks for the answer. You also, this is really a great and the car's harder. So, I think you absolutely hit them, you know, mid-24, as you said you would earlier this year. That's great. Now, you also had an SGNA target, you know, that you want to hit. And obviously, you know, when you have a downturn in pricing, you want to get lean and tight. As soon as the SGNA is still staying up there, and there's also legal costs you're having. And can you talk about, you know, what can you do to get the SGNA down or to what you want to get to?

Speaker Change: Thanks for the answer.

Joel Jackson: And the cost targets, I think you absolutely hit them, you know, mid 24, as you said you would earlier this year. So that's great. Now, you also had an SG&A target, you know, that you want to hit.

Speaker Change: You also this is really great and the cost targets I think youre absolutely hit them. You know mid 24 as you said you would've early this year such great. Now you also had an SG&A target that you want to hit and obviously when you have a downturn in pricing you wont get lean and tight.

Ana Cabral: Because ultimately, I mean, it's not anything, let's say, exceptional that we've done. What we've done is the following. This media separation method is one that's constrained by the capacity of the concentrator, the centrifugator, which in our case is 250 tons an hour, 800%, but the design capacity is 237 tons an hour. So that's a constraint. So even if I lower my lithium off by grade, I'm still constrained by that capacity. I can only flow that tonnage of product per hour.

Joel Jackson: And obviously, you know, when you have a downturn in pricing, you want to get lean and tight. It seems like the SG&A is still staying up there. And there's also legal costs you're having. Can you talk about, you know, what can you do to get the SG&A down or to what you want to get to? Joel, I'll take this one, right?

Speaker Change: So as of yesterday is still staying up there.

Speaker Change: It is also the legal costs are having can you talk about what.

Speaker Change: What can you do to get the SG&A down more to what you want to get too.

Matthew DeYoe: Joel, take this one, right? And part of this is, it's hard when we, when we brought out the SGNA guidance, it was a bit of a discussion around what we needed to sustain phase one operations, but obviously we have intention to grow. And so, what we've been building is a, is a operationally and commercially sophisticated organization to give us the platform to double capacity and to triple capacity, right? Was we talk about things like internalizing our commercial capabilities and, I mean, just use that as an example, right? We've had to build out the commercial team.

Matthew DeYoe: And part of this is, It's hard when we brought out the SG&A guidance, it was a bit of a discussion around what we needed to sustain phase one operations. But obviously, we have intention to grow. And so what we've been building is a is a operationally and commercially sophisticated organization to give us the platform to double capacity and to triple capacity, right? We talk about things like internalizing our commercial capabilities, and, I mean, let's just use that as an example, right?

Speaker Change: Joe I'll take this one right and part of this is.

It's hard when we can be proud out the SG&A guidance. It was a bit of a discussion around what we needed to sustain phase one operations, but obviously, we have intention to grow.

Speaker Change: And so what we've been building is a.

Speaker Change: Operationally.

Speaker Change: And commercially sophisticated organization to give us the platform to double capacity in the triple capacity right. When we talk about things like internalizing, our commercial capabilities and.

Ana Cabral: So this is a characteristic of my industrial plant, the green type plant. Now, what have we learned? We learned that the higher the quality of the pre-feed into the centrifugator into the dense media separator, the higher our recovery. So what we're doing is a very elaborate system of screens and pre-screening and preparation of the feed that goes into that capacity, which unfortunately is fixed. It can already increase with an expansion. So that I can increase recovery.

Matthew DeYoe: We've had to build out the commercial team. In the grand scheme of things, I think you can see the implications on the reduction to our sales expense on the income statement and what that means for real dollar savings, but it also means some creeping costs on the back end. But look, scale is our friend at Sigma and SG&A is a key area where we will be able to scale. We do not need to double our SG&A to double our production capacity.

Speaker Change: I mean, let's just use that as an example, right we've had to build out the commercial team in the Grand scheme of things I think you can see the implications on the reduction to our sales expense on the income statement and what that means for real dollar savings, but it also means some creep in cost on the backend, but look scale is our friend at Sigma and S.

Matthew DeYoe: And the grand scheme of things, I think you can see the implications on the reduction to our sales expense on the income statement and what that means for real-dollar savings, but it also means some creep and costs on the back end. But look, scale is our friend at Sigma, and SGNA is a key area where we will be able to scale because we do not need to double our SGNA to double our production capacity. So we're kind of caught in a little bit of this framework of a growth company and trying to also be the right size for when that situation arises.

Speaker Change: G&A as a key area, where we will be able to scale, because we do not need to double our SG&A to double our production capacity. So we're kind of caught in a little bit of this a free.

Ana Cabral: So I increase yield. By feeding better material, pre-purified pre-screened material, I am able to achieve better results in the dense media separation. That's what we're doing. And we've already gotten there. Now, we've hit the stride over 700 tons a day, which is something that in the past would have been called, you know, an exceptional day. Now, this is our regular day. And we're hoping to move that further upwards to even higher levels of daily production. So that's kind of what the depuration of the feed that goes into those centrifugators do for our production throughput for our yield. Thanks, Dave.

Matthew DeYoe: So we're kind of caught in a little bit of this framework of a growth company and trying to also be the right size for when that situation arises. But again, things like SG&A, that on a per ton basis will not get fully cut in half, but it'll get pretty close as we grow. And that's part of the leverage in the operating model that we really are looking forward to. Ana and thank you for that Matt.

Speaker Change: Framework of a growth company and trying to also be the right size for when that situation arises, but again things like SG&A.

Matthew DeYoe: But again, things like SGNA, you know, that, that on a part-time basis will not get fully cut. It will get pretty close as we as we grow. And that's part of the leverage in the operating model that we really are looking forward to.

Speaker Change: On a per ton basis will not get fully cut app will get pretty close as we as we grow and that's as part of the leverage in the operating model that we really are looking forward to.

Ana Cabral: Anna, and thank you for that. Anna, I just bought from that one where I'll pass the baton. So I understand wanting to not give up on the growth, obviously. We all know what's happening with sponsoring markets right now and the lithium markets right now. What Anna would you have to see? Like, would you have to see many more months of these suppressed sponsoring prices before you make a decision to just really be done on SGNA, cost where you can hold on to pay one? Or face who's happening no matter what, no matter what. Price. Well, no, this is happening no matter what.

Ana Cabral: Ana can I just follow up on that one more and I'll pass the baton. So I understand wanting to not give up on the growth. Obviously, we all know what's happening with spodumene markets right now and the lithium markets right now. What Ana would you have to see like would you have to see many more months of these suppressed spodumene prices before you make the decision to just really lean on SG&A, cut costs where you can and hold on to phase one or phase two is happening no matter what, no matter the price. Well, no, it's just happening no matter what.

Speaker Change: And thank you for that matter in a kind of a swap on that one more and I'll pass the baton. So I understand wanting to not give up on the growth. Obviously, we all know what's happening responsory markets right now in the lithium markets right now what Ana would you have to see like would you have to see many more months of these suppressed spodumene prices before you make a decision to just really lean on the SG&A.

Joel Jackson: We'll go to the next one. Our next question will come from the line of Joel Jackson with the BMO. Please go ahead. Morning, man. And thanks for the commentary on phase two. So a bit of a technical question. You know, there's always a bit of dispute going on in some of the land inside where you reserve is or where the affidels replace to. If you don't get some sort of agreement there.

Ana: Hey cut costs, where you can hold on to phase one or phase two is happening no matter what no matter the price.

Speaker Change: CapEx on the quarter was roughly $9 million, which represents some payments on the phase two expansion, as well as some of the brownfield mine and plant investments that Anna had mentioned on the prior slides.

Ana Cabral: I think this slide that you see here illustrates that well. In other words, if Sigma cannot operate profitably, I think the whole industry is doomed, right? Because we're sitting to the right of green bushes on top of the bar in terms of our low cost.

Ana: Well no issues happening no matter, what I think this slide that you see here illustrates that well in other words, if sigma cannot operate profitably I think the whole industry is doomed right because we're sitting to the right of green bushes on top of Pilbara in terms of our our low costs. So there's not a whole lot more than we can do we're going to continue to.

Speaker Change: With that, I'm going to pass it back to Anna and we'll talk through a bit about the liquidity transition of the company.

Ana Cabral: I think this slide that you see here illustrates that well. In other words, if Sigma cannot operate properly, I think the whole industry is doomed, right? Because we're sitting to the right of green bushes on top of the ovarian terms of our low cost. So there's not a whole lot more that we can do. We're going to continue to strive for lowering costs. But now focusing on unit cost reduction, meaning as we have these opportunities to drive further up our production yields, the costs are going to go down just as a result of a larger volume being sold.

Anna: Yeah, so again, just to wrap up the financial section, I mean, we have a very comfortable liquidity position.

Speaker Change: I mean, to consider operational performance, the math was described and we discussed regarding sales cadence and cost control.

Speaker Change: All of what we described throughout this presentation translated into very, very tangible benefits for this company. In other words, robust access to exporting credit. So robust liquidity.

Joel Jackson: Can you proceed on phase two, which you have to move phase two different part of the resource? What will give you confidence legally for the company due to the advanced phase two as designed on the land you want to do it? Joel, I think there's a massive confusion on your end here regarding land dispute. What we are the only thing that's actually in there, it's essentially an or body that doesn't have anything to do with phase two.

Ana Cabral: So there's not a whole lot more that we can do. We're going to continue to strive for lowering costs, but now focusing on unit cost reduction, meaning as we have these opportunities to drive further up our production yields, the costs are going to go down just as a result of larger volumes being sold. But when you go back to the phase two project per se, I mean, we got the liquidity to do it.

Speaker Change: We have a very comfortable liquidity position with the cash balance in August, topping up $99 million US dollars.

Ana: Strive for lowering costs, but now focusing on unit cost unit cost reduction, meaning as we have these opportunities to drive further up our production yields the costs are going to go down just as a result of a larger volumes being sold but when you go back to the project.

Speaker Change: Basically, when you look at this chart, if you look at the upper the upper left chart, you can see that the short term debt is basically comprised of those export link trade lines, which are drawn, but are entirely sitting in our treasury.

Speaker Change: In other words, we could pay them all back today if they're all due.

Ana Cabral: But when you go back to the project to face two projects per se, I mean, we got the liquidity to do it. And when you look at the capital efficiency of that project, it's essentially one questionable that we have to go ahead with it. I mean, just recapping this slide, there's absolutely nothing out there as efficient as of throwing a second line and going with it. If you add the gains that we would have by fixed cost dilutions to it, which we typically don't, but just doing SGNA dilution because the pretty obvious one, it becomes going to complete no brainer, which we don't add to our analysis.

Ana: The phase two project per Se I mean.

Ana Cabral: And when you look at the capital efficiency of that project, it's essentially unquestionable that we have to go ahead with it. I mean, just recapping the slide, there's absolutely nothing out there that's as efficient as throwing a second line and going with it.

Speaker Change: More importantly, and that's the key point, we have decreased the cost of these export link credit to $5.85 total fixed in dollars, which is a very, very favorable rate for a company in its first year.

Joel Jackson: That sits between phase two and phase three. That's independent of those two phases. And that's nothing to do with sigma. So phase two is to the laughter of that or body and it's absolutely not connected to it. So we can go about our business irrespectively of what happened there. Now, what's the most important thing is that that area is actually controlled by me. So I have 51 cent of that area is a Brazilian corporation.

Ana: We got the liquidity to do it and when you look at the capital efficiency of that project. It's essentially one questionable that we have to go ahead with it I mean, just recapping does lie theres, absolutely nothing out there that as efficient as throwing a second line.

Speaker Change: And again, that's a sharp contrast to 1515 percent that we were granted in our very first trade line in January 2024.

Speaker Change: This very first trade line has been retired long, long ago, but it just shows the quick evolution of our robust credit worth.

Speaker Change: And as we continue to demonstrate sales cadence and cost, of life.

Speaker Change: And that is a good segue for the following stage, where we actually talk about our face to expansion and give you an update on that. First, I have to reiterate this very strong and compelling business case for Sigma to continue to push and execute on doubling its production capacity by expanding its industrial facilities in Brazil.

Speaker Change: I mean, we have a very, very privileged position in this industry where we actually have an industrial line that delivers or that actually represents one of the lowest-capex-intensive projects in the world. And this is actually measurable.

Ana: And going with it.

Ana Cabral: If you add the gains that we would have by fixed cost dilution to it, which we typically don't, but just doing sGNA dilution because it's a pretty obvious one, it becomes then a complete no-brainer, which we don't add to our analysis, but it's there, and we all know it's there. You don't need two ANAs, two MATs, two of the what we call fixed infrastructure to do what we need to do with two lines, right?

Ana: If you add the gains that we would have by fixed cost dilution to it which we typically don't but just doing SG&A dilution because they're pretty obvious one.

Speaker Change: And this is why you love these industries because they remove the opinion out of the conversation.

Speaker Change: Mathematics is just a data, a number, doesn't carry a new opinion.

Joel Jackson: So even if that were to become an issue, I would obviously resolve it favorably. So it's a non issue. So going back to it, essentially, what we are doing is just proceeding with our plan's business as usual. I mean, we got biohedral, which is phase two giant olabadi, which can be accessed by all sides. The mining concession belongs to Sigma, the overground belongs to a company that's affiliated to Sigma. So, you know, business is usual, pursuing business is usual.

Ana: It becomes then a complete no brainer, which we don't add to our analysis, but it's there and we'll know what's there you don't need to arm is to match too.

Speaker Change: So what we did, we tracked announced projects in capex announcements. And we calculated what we call capex efficiency ratio, which is essentially a division of the total capex of a project US dollar millions by the production capacity in tons for tons of lithium concentrates all around the world. And we rank at the very top of this rank, meaning we are the most efficient in the lowest capex-intensive project in the world.

Ana Cabral: But there, it will all know it's there. You don't need two on us, two maps, two, you know, of D, what we call fixed infrastructure to do what we need to do with two lines, right? So, as Matt was saying, scale it up, Fran. What we're doing, though, and you raise an excellent point, Joe, on discipline. We're pacing it. In other words, when we did the first project, and you remember that very well, we were racing it. So we're going to race versus space, so sorry, we went from race to get to market, which is what we did in January 2022, as we raised the capital for phase one. We are in a race because it was a boom market of historical proportions, and we knew we had to become operational and hit and achieve production in scale while the boom market was happening.

Speaker Change: On the last, we give you a bit more color where you can see a plotting on a 2D chart with a bubble that just gives you the size of the of the size of the index calculated on the chart to the right, which again shows our little tiny index, which is point 40, and how efficient we are.

Ana: Of the what we call fixed infrastructure to two.

Ana Cabral: So as Matt was saying, scale is our friend. What we're doing, and you raise an excellent point, Joel, on this, we're pacing it. In other words, when we did the first project, and you remember that very well, we were racing it. So we're going to race versus space.

Ana: To do what we need to do with two lines rates. So it matches the same scale as our France will be doing do it and you raised an excellent point Joe on discipline, we're pacing it in other words when we did the first project and you remember that very well we were raising it so we're going to race versus space.

Speaker Change: The smaller the bubble and again the lower the quadrant, the better the project is.

Speaker Change: So we're kind of fitting a legal wrong in terms of capital efficiency here.

Ana Cabral: So sorry, we went from race to get to market, which is what we did in January 2022 as we raised the capital for phase one. We are in a race because it was a bull market of historical proportions and we knew we had to become operational and achieve production in scale while the bull market was happening. And we did that a year ago. Now, we measured no efforts to do it.

Speaker Change: And again, this is a result of what I'm going to show you in the next slide.

Joel Jackson: You might be referring to the noise my, let's say, former husband, try to make to create that sort of misunderstanding, but it's great that you raised this point because it's an opportunity for me to clear it out for all of the participants in this conference. That noise has nothing to do with Sigma. In fact, I have great news for everyone in attendance. My divorce has been declared quite a while ago. And as you can all see, I'm still here, sigma, you hear, there's been no implication to Sigma of the declaration of my divorce, the split of the assets and, you know, business is usual for all of us.

Ana: So sorry, we went from race to get to market, which is what we what we did in January 2022, as we raise the capital for phase one we are in our rates because it was a bull market of historical proportions, and we knew we had to become operational.

Speaker Change: And I'll skip two slides and then I'll go back one second.

Speaker Change: In the next slide, you can see the IARIO demonstration of our site, our industrial site in Brazil.

Speaker Change: You have one square kilometer of industrial facilities here.

Joel Jackson: So, you was just, as Shakespeare said, much a do about nothing. But it's understandable in, you know, divorce when one of the parties is less wealthy than the other one. Okay. So, my next question. That's published here. Thanks for the answer. You also, this is really a great and the car's harder. So, I think you absolutely hit them, you know, mid-24, as you said you would earlier this year. That's great. Now, you also had an SGNA target, you know, that you want to hit.

Ana: And hit in a cheap reduction in scale, while debut market was happening and we did that a year ago.

Ana Cabral: And we did that a year ago. Now, we measured no efforts to do it. We pulled out what we call an acceleration plan for phase one that costs us $20 million extra, where we were flying equipment, you know, short-circuiting steps on construction just to get there on time. And we turned the plan on in May, April, May 23, and by July, we had our first shipment out of the door. That was phase one. Now, very, very different environment. So it's interesting because the environment now reminds you, the environment that we had when we were doing the details engineering for phase one, which was tutoring COVID, not the best part of COVID, the earlier 2020, which is a very challenging environment.

Ana Cabral: We pulled out what we call an acceleration plan for phase one that cost us $20 million extra where we were flying equipment, you know, short circuiting steps on construction just to get there on time. And we turned the plant on in May, April, May 23. And by July, we had our first shipment out of the door. That was phase one. Now, very, very different environment.

Ana: Now we measure no efforts to do it we pulled off what we call an acceleration plan for phase one the cost of $20 million extra when we were flying equipment shoe.

Ana: Short circuiting.

Ana: Our steps on construction just to get there on time and.

Ana: And we turned the plant on in May April May 23, and by July we had our first shipment out of the door that was phase one now.

Joel Jackson: And obviously, you know, when you have a downturn pricing, you want to get lean and tight. As soon as the SGNA is still staying up there, and there's also legal costs you're having. And can you talk about, you know, what can you do to get the SGNA down or to what you want to get to? Joel, take this one, right? And part of this is, it's hard when we, when we brought out the SGNA guidance, it was a bit of a discussion around what we needed to sustain phase one operations, but obviously we have intention to grow.

Ana Cabral: So it's interesting because the environment now reminds me of the environment that we had when we were doing the detailed engineering for phase one, which was still during COVID, not the best part of COVID, the earlier 2020, which is a very challenging environment. So we went back to the drawing board, to the project execution plan timeline that we had banned, which is a 12 month comfortable, we call 12 to 15 month comfortable, and we already started project execution timeline, meaning we're not using the acceleration budget, whatsoever. So we're going to receive equipment in the regular lead times. We're going just to follow the regular trajectory of the schedule.

Ana: Now very very different environment. So it's interesting because the environment now remind you the environment that we had when we were doing the detailed engineering phase, one which was still during COVID-19.

Ana: Not the best part of Covid. The earlier 2020, which is a very challenging environment. So we went back to the drawing board to the project execution plan timeline that we had band which is a 12 month comfortable with call. It 12 to 15 months comfortable and we already started project execution timeline, meaning.

Ana Cabral: So we went back to the drawing board to the project execution plan timeline that we had banned, which is a 12 month comfortable, we called 12 to 15 month comfortable, and we already started project execution timeline, meaning we're not using the acceleration budget. Whatsoever. So we're going to receive equipment in the regular times. We're going just to follow the regular trajectory of the schedule. So it's the based construction timetable versus the raised construction timetable because that is what allows us to actually manage the construction process in line with our own liquidity capabilities. And so far we're doing, you know, quite quite well with that.

Speaker Change: So when you see the layout, you can see that you have in green the existing insights inside the gate or the capex infrastructure inside the gate. That infrastructure is sufficient to essentially support three production lines that have the same throughput as our first production line with 270,000 tons of lithium concentrates per year. So benefiting from this existing capex infrastructure, the cost is almost 40 million US dollars, we will just build, we just need to build in order to double production capacity, one line as opposed to building line plus additional infrastructure.

Joel Jackson: And so, what we've been building is a, is a operationally and commercially sophisticated organization to give us the platform to double capacity and to triple capacity, right? Was we talk about things like internalizing our commercial capabilities and, I mean, just use that as an example, right? We've had to build out the commercial team. And the grand scheme of things, I think you can see the implications on the reduction to our sales expense on the income statement and what that means for real-dollar savings, but it also means some creep and costs on the back end.

Ana: We're not using the acceleration budget.

Ana: Whatsoever, so we're going to receive equipment in their regular lead times were going just to follow that.

Ana: The regular trajectory of the schedule. So it's the paste.

Ana Cabral: So it's the pace, construction timetable versus the raced construction timetable because that is what allows us to actually manage the construction process in line with our own liquidity capabilities. And so far, we're doing, you know, quite well on that. And again, for any questions, press star one. And your next question comes from the line of Andre Krupnik with Drakewood. Please go ahead.

Speaker Change: Construction timetable versus the res construction timetable because that is what allows us to actually manage.

Speaker Change: The construction process in line with our own liquidity capabilities, and so far we're doing quite well on that.

Joel Jackson: But look, scale is our friend at Sigma, and SGNA is a key area where we will be able to scale because we do not need to double our SGNA to double our production capacity. So we're kind of caught in a little bit of this framework of a growth company and trying to also be the right size for when that situation arises. But again, things like SGNA, you know, that, that on a part-time basis will not get fully cut.

Speaker Change: Okay.

Andrei Kroupnik: And again, for any questions, press star one, and your next question comes from the line of Andrei Kroupnik with Drakewood. Please go ahead. Hi, Ana, just follow up on what you were just discussing with Joel. So looking at your financials for the second quarter, your capital spend was quite light. So when do you expect the capital intensive phase? This phase to expansion to begin? And also, do you still keep on intending funding this? We sort of more short term trade finance line? So, is there a plan to add more debt? Oh, no, thank you for the questions.

Andre <unk>: And again for any questions Press Star one and your next question comes from the line of Andre <unk> with strike what please go ahead.

Joel Jackson: It will get pretty close as we as we grow. And that's part of the leverage in the operating model that we really are looking forward to. Anna, and thank you for that, Anna, I just bought from that one where I'll pass the baton. So I understand wanting to not give up on the growth, obviously. We all know what's happening with sponsoring markets right now and the lithium markets right now. What Anna would you have to see?

Andre Krupnik: Hi Ana, just a follow up on what you were just discussing with Joel. So looking at your financials for the second quarter, your capital spent was quite light. So when do you expect the capital intent to face? face to expansion to begin.

Speaker Change #100: Hi, just a follow up on <unk>.

Andre <unk>: You were just discussing with Joe So looking at your financials for the second quarter capital spend was quite light. So when do you expect the capital intensive phase.

Andre Krupnik: And also, do you still keep on intending funding this with sort of more shorter term trade finance lines? Or is there a plan to add more debt? Oh, no, thank you for the question. And it's a very good question.

<unk> two expansion to begin.

And also do you still keep on extending funding this with some short term trade finance line. So is there a plan to us.

Andre <unk>: Ed.

Speaker Change #101: Oh no. Thank you for the questions. It's a very good question the cap typically in the in our in these constructions. The capex really picks up at the very end and you can see by the.

Ana Cabral: It is a very good question. The cap typically in the in out in these constructions, the context really picks up at the very end. And you can see by the previews, the previous project, right? You have a bulk at the beginning, which relates to deposits or prepayments of lonely items. Earthworks is quite inexpensive. The total earthworks cost is $8.9 to $9 million. And that's basically it. And so you basically pay for earthworks, pay for that engineering. And then you're depositing towards equipment. In our case, we've got a break for our chemical zero. You need, you know, and you need levels of sustainability.

Ana Cabral: Typically, in these constructions, the capex really picks up at the very end. And you can see by the previous project, right? You have a bulk at the beginning, which relates to deposits or prepayments of long-lived items. Earthworks is quite inexpensive.

Joel Jackson: Like, would you have to see many more months of these suppressed sponsoring prices before you make a decision to just really be done on SGNA, cost where you can hold on to pay one? Or face who's happening no matter what, no matter what. Price. Well, no, this is happening no matter what. I think this slide that you see here illustrates that well. In other words, if Sigma cannot operate properly, I think the whole industry is doomed, right?

Speaker Change #101: By the previews the previous project right you have a bulk at the beginning which relates to.

Speaker Change #101: The Plaza tour prepayments of long lead items earthworks is quite inexpensive. The total earthworks cost is $8 $9 million to $9 million and that's basically it and so you're basically paying for earthworks pain score for that engineering.

Speaker Change: So that lowers the construction cost significantly, as you can see on this slide, because the construction capex to build to replicate one production line is 100 million US dollars.

Ana Cabral: The total earthworks cost is $8.9 to $9 million. And that's basically it. And so you're basically paying for earthworks, paying for that engineering, and then you're depositing towards equipment. In our case, we got a break for our quintuple zero unique, you know, and unique levels of sustainability excellence. Most global manufacturing equipments want to work with us. So what does that mean?

Joel Jackson: Because we're sitting to the right of green bushes on top of the ovarian terms of our low cost. So there's not whole lot more that we can do. We're going to continue to strive for lowering costs. But now focusing on unit cost reduction, meaning as we have these opportunities to drive further up our production yields, the costs are going to go down just as a result of a larger volume being sold.

And then youre depositing towards equipment in our case, we've got a break for our integral zero.

Speaker Change #101: <unk> unique.

And unique levels of sustainability actually most global manufacturing equipments want to work with us. So what does that mean, we did we know long well and obviously now we have credits where we are a company that has revenues and delivered cash flow. So the credit worthiness plus hour.

Ana Cabral: So what does that mean? We did, we know, well, and obviously, now we have credit. We are, we are company that has revenues and delivers cashflow. So the credit worth in it plus our, you know, super special green deck plant in our green credentials attracted some of the largest global OEM parts manufacturers to work with us on this project. So we're no longer required to deposit to prepay for lonely items, which is something we have to do in phase one. Some of the lonely items had to be fully paid before they even began construction in their respective supplier manufacturing line.

Ana Cabral: We know long, well, and obviously now we have credit. We are a company that has revenues and delivers cash flow. So the credit worthiness plus our, you know, super special green tech plant in our green credentials attracted some of the largest global OEM parts manufacturers to work with us on this project. So we're no longer required to pre-pay for long lead items, which is something we had to do in phase one. Some of the long lead items had to be fully paid before they even began construction in their respective supplier manufacturing lines.

Joel Jackson: But when you go back to the project to face two projects per se, I mean, we got the liquidity to do it. And when you look at the capital efficiency of that project, it's essentially one questionable that we have to go ahead with it. I mean, just recapping this slide, there's absolutely nothing out there as efficient as of throwing a second line and going with it. If you add the gains that we would have by fixed cost dilutions to it, which we typically don't, but just doing SGNA dilution because the pretty obvious one, it becomes going to complete no brainer, which we don't add to our analysis.

Speaker Change #101: Super Special Greentech plant in our Green credentials attracted some of the largest global OEM parts manufacturers to work with US on these projects. So we're no longer required to pause not to prepay for long lead items, which is something we have to do in phase.

Speaker Change #101: One some of the long lead items had to be fully paid before they even began construction in their respective supplier manufacturing lines. So we're saving some money there. So the long lead items Bill for Phase one was around 15, one 5 million U S dollars and we think the long lead item Bill.

Ana Cabral: So we're saving some money there. So the lonely item bill for phase one was around $15 million. And we think the lonely item bill here is somewhat expanded, but you will be a bit smaller than that. So, as you can see, lonely items and earthworks are the two main elements of cost of this project. If you look at the project execution plan, as I see here, throughout third quarter, fourth quarter, we're just going to have the bigger numbers hitting us on the first quarter as equipment starts getting delivered. And then you have to fully pay for the equipment.

Ana Cabral: So we're saving some money there. So the long lead item bill for phase one was around 15, 1.5 million US dollars. And we think the long lead item bill here is somewhat expanded, but it will be a bit smaller than that. So as you can see, long lead items and earthworks are the two main elements of cost of this project, probably throughout, if you look at the project execution plan, as I see here, throughout third quarter, fourth quarter, we're just gonna have the bigger numbers hitting us on the first quarter as equipment starts getting delivered, and then you have to fully pay for the equipment.

Joel Jackson: But there, it will all know it's there. You don't need two on us, two maps, two, you know, of D, what we call fixed infrastructure to do what we need to do with two lines, right? So as Matt was saying, scale it up, Fran, what we're doing, though, and you raise an excellent point, Joe, on discipline. We're pacing it. In other words, when we did the first project, and you remember that very well, we were racing it.

Speaker Change #101: Here is somewhat expanded but it will be a bit smaller than that so as you can see long lead items and earthworks are the two main elements of cost of this project probably throw it out.

Speaker Change #101: If you look at the project execution plan as I see here throughout third quarter fourth quarter, we just going to have the bigger numbers hitting us on our first quarter as equipment starts getting delivered and then you have to pay for the equipment. So it's kind of a back loaded capex as you can see and we've put on the screen. The full capex. So that you can see the comparison.

Joel Jackson: So we're going to race versus space so sorry, we went from race to get to market, which is what we did in January 2022, as we raised the capital for phase one, we are in a race because it was a boom market of historical proportions and we knew we had to become operational and hit and achieve production in scale while the boom market was happening. And we did that a year ago.

Ana Cabral: So it's kind of a backloaded capex, as you can see, and we put on the screen the full capex so that you can see the comparison to, and you can also see Joel, Joel's point; you see the construction acceleration plan, that was the raised portion of it, which we eliminated 20 million bucks. So this time is the pay, meaning we don't have that acceleration plan in place. It's there, it's quoted, but we're not going to need to trigger it because we're just based. We know Rush to sell cheaply; you know, you just put it that way.

Ana Cabral: So it's kind of a back loaded CapEx, as you can see. And we put on the screen the full CapEx so that you can see the comparison too. And you can also see Joel's point. You see the construction acceleration plan. That was the race portion of it, which we eliminated.

Joe So: Since you and you can also see Joe Joe's point, you see the construction acceleration plan that was the rage portion of it which we eliminated 20 million Bucks. So this time is the page, meaning we don't have that acceleration plan in place. It's there it's quoted but we're not.

Ana Cabral: It's 20 million bucks. So this time is the pace, meaning we don't have that acceleration plan in place. It's there, it's quoted, but we're not gonna need to trigger it because we're just pacing.

Speaker Change: Now, based on what I just discussed regarding trade lines, we've been using these trade lines to deploy the early capex required for this project, because for the first six months to nine months of the project, the cost of actual deployment is quite low, and we can perfectly cover that with our trade lines, which are quite robust and with our own cash generate.

Speaker Change: Foundation.

Joel Jackson: Now, we measured no efforts to do it. We pulled out what we call an acceleration plan for phase one that costs us $20 million extra, where we were flying equipment, you know, short circuiting steps on construction just to get there on time. And we turned the plan on in May, April, May 23, and by July, we had our first shipment out of the door. That was phase one. Now, very, very different environment.

Speaker Change: And so as you can see here, we have this cash position which keeps on getting replenished every month as we receive the proceeds of our very cadence sales.

Speaker Change #103: We're going to need to trigger it because we're just basing it.

Ana Cabral: We're no rush to sell cheap lithium, let's just put it that way. And so the second part, is there a plan to take on any more debt or are you just going to do it from the existing trade finance line? Oh, no, sorry, I didn't answer that.

Speaker Change #103: We have no rush to sell cheaply.

Speaker Change #103: Put it that way.

Ana Cabral: So the second part, is there a plan to take on any more debt, or you're just going to do it from the existing trade finance plan? Oh, no, sorry, I didn't answer that. We are in ongoing discussions with, well, we announced it actually. We are in ongoing discussions with Brazil's development bank, the NDS. The NDS is embarked in a very successful, new industrialization driving Brazil. We are part of that. It's centered on green industry, green producers on generation of industrial jobs. Just to put in perspective, Sigma just created an entire territory in the poorest region of the country.

Speaker Change #103: And so the second part of it is.

Speaker Change #104: Is there a plan to take on any more debt or you're just going to do it from the existing trade Finance fund.

Speaker Change: And then we essentially have these straight lines which are drawn but get replenished every month with our own cash generation internally.

Sorry, I didn't answer that we are a new ruling discussions with well we announced it actually we are in ongoing discussions with Brazil's development bank. The NTSB MBS is embarked in a very successful.

Ana Cabral: We are in ongoing discussions with, well, we announced it, actually. We are in ongoing discussions with Brazil's development bank, BNDS. BNDS is embarked on a very successful new industrialization drive in Brazil. We are part of that. It's centered on green industry, green producers, on generation of industrial jobs. Just to put in perspective, Sigma just created an entire territory in the poorest region of the country. We have about 13,000 direct and indirect jobs there, 1,500 direct jobs.

Joel Jackson: So it's interesting because the environment now reminds you, the environment that we had when we were doing the details engineering for phase one, which was tutoring COVID, not the best part of COVID, the earlier 2020, which is a very challenging environment. So we went back to the drawing board to the project execution plan timeline that we had banned, which is a 12 month comfortable, we called 12 to 15 month comfortable, and we already started project execution timeline, meaning we're not using the acceleration budget.

Speaker Change #105: New industrialization driving Brazil, we are part of that is centered on green industry Green producers on generation of industrial jobs, just to put in perspective Sigma just created an entire territory in the poorest region of the country, we have about 13000 direct and indirect jobs there one.

Speaker Change: So we have an ample and very comfortable position to continue to execute our face-to-expansion in the timetable that we have a set for which is a 12 month construction period.

Ana Cabral: We have about 13,000 direct and indirect jobs there; 1,500 direct jobs. So we're top of the line on the new industrialization development plan of Brazil. And we're bound to, we applied for a $100 million, a $100 million US dollar credit line with the NDS, which is going incredibly well because we sit within that, you know, framework of industrial policy. So that will be the primary source of funding; the duration is exceptionally, you know, a benign because it's development bank credit. So it's longer than 15 years. So it's a spread out duration; rates also are very favorable.

Speaker Change #105: 500 direct jobs. So we're top of the line on the new industrialization development plan of Brazil, and we are bound to we applied for a 100 U S dollar.

Ana Cabral: So we're top of the line on the new industrialization development plan of Brazil. And we're bound to, we applied for a 100 US dollar, 100 million US dollar credit line with BNDS, which is going incredibly well because we sit within that, you know, framework of industrial policy. So that will be the primary source of funding. The duration is exceptionally, you know, benign because it's development bank credit. So it is longer than 15 years. So it's a spread out duration. Rates also are very favorable. Today, that line would have rates of about 8% in local currency, which are even lower than our current dollar denominated rates.

Speaker Change: We already started it so if we look at the current slide we have worked on the way with conducting what a very important point, a very very important point that we undertook doing phase 1 as well, which to conduct the suppression of the what we call the savannah, the desertic, sanitary, cactus, bush vegetation, adhering to the very high standards of environmental sustainability.

Joel Jackson: Whatsoever. So we're going to receive equipment in the regularly times. We're going just to follow the regular trajectory of the schedule. So it's the based construction timetable versus the raised construction timetable because that is what allows us to actually manage the construction process in line with our own liquidity capabilities. And so far we're doing, you know, quite quite well with that.

Speaker Change: So we're doing what we call inventory of speeches.

100 million U S dollar credit line will be M. D S.

Speaker Change: We're doing fauna capturing so if you find a fauna speeches which are basically reptiles, so we capture them, we inventory them and we deliver them to the appropriate authorities.

Speaker Change #105: Which is going incredibly well because we sit within that.

Speaker Change: So we're doing this adhering to the very high standards globally off what we call clearing an area for earth works which is exactly what we did when we constructed phase 1.

Speaker Change #105: Framework of industrial policy.

Speaker Change #105: So that will be the primary source of funding debt duration.

Speaker Change #105: Exceptionally.

Speaker Change #105: Benign because its development bank credits. So it is longer than 15 years. So it just spread out duration rates also very favorable today that line would have rates of about 8% in local currency, which are even lower than our current dollar denominated rates.

Speaker Change: So that's kind of how we operate.

Ana Cabral: Today, that line would have rates of about 8% local currency, which are even lower than our current dollar-denominated rates. So they'll be our primary source of face-to-funding. And then, in parallel, what we're also doing, just to show how active we've been on managing our capital structure for the current environment. If you look at our liquidity slide, you can see that we got long term shareholder debt, which was that that was generously given us by our shareholders when we were too pre operational, right? So this debt has restrictive covenants; he has a higher rate. So we're also in active dialogue with the banking community to conduct liability management on that debt, where we're planning to replace that debt, even though it's benign mature in 2026.

Speaker Change: You can clearly see here in pictures that work being conducted by our own proprietary team.

Ana Cabral: And again, for any questions, press star one and your next question comes from the line of Andrei Kroupnik with Drakewood, please go ahead. Hi, Ana, just follow up on what you were just discussing with Joel. So looking at your financials for the second quarter, your capital spend was quite light. So when do you expect the capital intensive phase? This phase to expansion to begin? And also do you still keep on intending funding this?

Ana Cabral: So that will be our primary source of phase two funding. And then in parallel, what we're also doing, just to show how active we've been on managing our capital structure for the current environment, if you look at our liquidity slide, you can see that we got long-term shareholder debt, which was debt that was generously given us by our shareholders when we were still pre-operational, right? So this debt has restrictive covenants. It has a higher rate.

Speaker Change #105: So that'll be our primary source of phase III funding and then in parallel while we also doing just to show how active we've been on managing our capital structure for the current environment. If you look at our liquidity slide you can see that we've got long term shareholder that which was that there was generously given us.

Speaker Change: So that's an expertise we have in our mental department.

Speaker Change: On the next slide is just a recapping where we're going.

Speaker Change: Well, we are clearly on a very disciplined approach to reach 100,000 tons of lithium carbonate equivalent production, essentially by 2026. One production line at a time.

Speaker Change: We show to the product.

Speaker Change: We show to these sites, our industrial site.

Speaker Change #105: By our shareholders when we were still pre operational rates.

Speaker Change: We have all the area we need there.

Ana Cabral: We sort of more short term trade finance line? So is there a plan to add more debt? Oh, no, thank you for the questions. It is a very good question. The cap typically in the in out in these constructions, the context really picks up at the very end. And you can see by the by the previews, the previous project, right? You have a bulk at the beginning, which relates to deposits or prepayments of lonely items.

Speaker Change: There's one square kilometer off industrial area.

Speaker Change #105: So this that has restricted covenants. He has a higher rate. So we're also in active dialogue with the banking community to conduct liability management on that that we were planning to replace that debt, even though it's a benign maturing 2026 and we will.

Ana Cabral: So we're also in active dialogue with the banking community to conduct liability management on that debt, where we're planning to replace that debt, even though it's benign, it's maturing 2026, and it was given to us by a shareholder, we're planning to replace that debt with commercial banking debt as well. So we're very active in the debt market as we speak at the moment. Development bank debt, you know, duration of over 15 years for the actual, you know, cornerstone centerpiece of building the plant and a commercial bank debt for amongst other things conduct liability management on the shareholder debt.

Speaker Change: The capex infrastructure on site supports two lines.

Speaker Change: And so what we're doing as a result of the lithium market environment, which we don't control, is to focus on what we control, which is to have a very disciplined approach to capacity expansion. Meaning we're doing one production line per year. We're not doubling up on production lines, which basically gives us a very measurable and a very achievable construction project to deliver to our shareholders within the next 12 months.

Speaker Change: So at that we're going to increase production capacity to approximately 80,000 tons of lithium carbonate equivalent or 520,000 tons of lithium concentrates. We're hoping to hit that by this time next year.

Ana Cabral: Earthworks is quite inexpensive. The total earthworks cost is $8.9 to $9 million. And that's basically it. And so you basically pay for earthworks, pay for for that engineering. And then you're depositing towards equipment. In our case, we've got a break for our chemical zero. You need, you know, and you need levels of sustainability. So what does that mean? We did, we know, well, and obviously now we have credit. We are, we are company that has revenues and delivers cashflow.

Ana Cabral: And you know, it was given to us by a shareholder. We're planning to replace that with commercial banking as well. So we're very active in the debt market as we speak at the moment. Development bank debt, you know, tank duration of over 15 years for the actual, you know, cornerstone centerpiece of building the blonde and commercial bank that for amongst other things conduct liability management on the shareholder debt.

Speaker Change #105: Given to us by a shareholder we're planning to replace that that with commercial banking that as well. So we're very active in the debt markets as we speak at the moment development bank that.

Speaker Change: And then we're going to embark on the third construction, which is again, to put another parallel third production line with the same capacity, named like capacity of 250,000 tons of LCEs parallel to that.

Speaker Change #105: <unk> duration of over 15 years for the actual cornerstone centerpiece of building the plant.

Speaker Change: So very, very well planned, thoroughly executed.

Speaker Change: And we're simply just replicating what we've done on phase one with the same discipline, because ironically, we're always called to build these facilities when the market conditions aren't exactly bullish.

SAKEMOP: So we have to exercise the discipline that has become our last name here at SAKEMOP.

Speaker Change #105: And our commercial bank that up for amongst other things conduct a liability management on the shareholder that.

Speaker Change: The next phase, is essentially talked a bit about the market and gives a bit of color of the way we're seeing things.

Unknown Executive: That will conclude our Q&A session.

Speaker Change: And I want to share that page with Matthew based.

Ana Cabral: That will conclude our Q&A session. I'll hand the call back over to Matt. Thank you, Regina. And with that, we're going to close the call. I appreciate everybody's time this morning and tuning in and we will see you on the conference circuit. Thank you. Thank you for the trust. Thank you for speaking with us. I mean, what we what we want to close with is the best is yet to come. And you can see we've been joined by a very prominent neighbor. So it's not just me saying that Brazil is really one of the most fantastic jurisdictions for industrial lithium production in the world.

And that will conclude our Q&A session I'll hand, the call back over to Matt.

Matthew DeYoe: I'll hand the call back over to Matt.

Matthew DeYoe: Thank you, Regina.

Matt David: Thank you Regina and with that we're going to close the call I. Appreciate everybody's time, this morning and tuning in and we will see you on the conference circuit over the coming weeks and months. Thank you. Thank you for the trust. Thank you for sticking with us.

Ana Cabral: And with that, we're going to close the call. I appreciate everybody's time this morning and tuning in, and we will see you on the conference circuit over the coming weeks and months. Thank you. Thank you for the trust. Thank you for sticking with us.

Speaker Change: I'll comment on this slide and then Matthew comment on a few other slides.

Speaker Change: So share the section with my partner here.

Speaker Change: This first slide, I'll cover that one. Essentially, it's pretty clear to all participants in the supply chain that the growth engine of electric vehicles this year is China. China is delivered almost 40% growth in the year, in out in electric vehicles all in like BVV sales.

Ana Cabral: I mean, what we want to close with is the best yet to come. And you can see we've been joined by our very prominent neighbor. So it's now just me saying that Brazil is really one of the most fantastic jurisdictions for industrial production in the world. And we're hoping that all of you are shareholders will continue to benefit from that tremendously over the next couple of years.

Speaker Change: And China's bounds to reach 60% of the global EV market by the end of the year, overtaking Europe. Which means that China has, which is a result actually of a consistent policy making, of consistent policy making exercise over the last decade when China has enacted a very successful EV growth subsidy program.

Ana Cabral: So the credit worth in it plus our, you know, super special green deck plant in our green credentials attracted some of the largest global OEM parts manufacturers to work with us on this project. So we're no longer required to deposit to prepay for lonely items, which is something we have to do in phase one. Some of the lonely items had to be fully paid before they even began construction in their respective supplier manufacturing line.

Speaker Change #106: Well, we want to close with is the best is yet to come and you can see we've been joined by a very prominent neighbor. So it's not just me, saying that Brazil is really one of the most fantastic jurisdictions for industrial lithium production in the world and we're hoping that all of you our shareholders will continue to benefit from that tremendous.

Speaker Change: And when you think about it, and again, just to think about it, in 2019, EV sales in China were about 3% of total car sales.

Ana Cabral: So we're saving some money there. So the lonely item bill for phase one was around $15 million. And we think the lonely item bill here is somewhat expanded, but you will be a bit smaller than that. So as you can see, lonely items and earthworks are the two main elements of cost of this project. If you look at the project execution plan, as I see here, throughout third quarter, fourth quarter, we're just going to have the bigger numbers hitting us on the first quarter as equipment starts getting delivered.

Speaker Change #106: Over the next couple of years.

Speaker Change: No one have taught that in 2024, just five years later, twice a year already, EV sales surpassed sales of combustion cars three or four times during this year already.

Unknown Executive: That will conclude today's call; you may now disconnect.

Matthew DeYoe: And we're hoping that all of you, our shareholders, will continue to benefit from that tremendously over the next couple of years. That will conclude today's call. You may now disconnect.

That will conclude today's call you may now disconnect.

Speaker Change: We represented over 50% of overall car sold in China. It's a remarkable achievement.

Speaker Change: And at that, I will encourage you to look at this slide on the left.

Speaker Change: So the global demand is essentially despite the behavior of EV sales in the western car market, the global demand is clearly set on the path to reach 1.1 million times of LCE equivalent by the end of 2024.

Speaker Change #106: That will conclude today's call you may now disconnect.

Speaker Change: If China can choose just on the face it is, we're going to need 1.4 million tons of LCE equivalent just by next year.

Speaker Change: What does that mean?

Speaker Change: It means you're going to need about 8 segments, right?

Speaker Change: 8 segments to reach these numbers, which is a pretty sizable number.

Ana Cabral: And then you have to fully pay for the equipment. So it's kind of a backloaded capex, as you can see, and we put on the screen the full capex so that you can see the comparison to and you can also see Joel, Joel's point, you see the construction acceleration plan, that was the raised portion of it, which we eliminated 20 million bucks. So this time is the pay, meaning we don't have that acceleration plan in place.

Speaker Change: In other words, the market is growing annually.

Speaker Change: Now what is equivalent to the entire size of the whole market just five years ago, meaning the whole market was 200,000 tons LCE in 2019.

Speaker Change: And that is the volume that is added to the market in the market, basically having only China as a local motive, which basically shows you that, you know, this market demand fundamentals are very much in there, because we never ever thought that we would see this kind of level of lithium carbon and equivalent demand back five years ago in 2025.

Ana Cabral: It's there, it's quoted, but we're not going to need to trigger it because we're just based. We know Rush to sell cheaply, you know, you just put it that way. So the second part, is there a plan to take on any more debt, or you're just going to do it from the existing trade finance plan? Oh, no, sorry, I didn't answer that. We are in ongoing discussions with, well, we announced it actually.

Speaker Change: All of you remember the first time rock you put out the 1 million ton LCE demand for 2025 in 2019.

Ana Cabral: We are in ongoing discussions with Brazil's development bank, the NDS, the NDS is embarked in a very successful, new industrialization driving Brazil. We are part of that. It's centered on green industry, green producers on generation of industrial jobs, just to put in perspective, Sigma just created an entire territory in the poorest region of the country. We have about 13,000 direct and indirect jobs there, 1,500 direct jobs. So we're top of the line on the new industrialization development plan of Brazil.

Speaker Change: And that was the biggest bouquet of the whole industry.

Speaker Change: Well, now that's our reality.

Speaker Change: In fact, it's our fair case.

Speaker Change: So I want to just recap these numbers because sometimes we get lost in the day-to-day of the ads and flows of prices, and we forget how compelling the actual fundamentals of the industry are.

Speaker Change: Yeah, and to build on that a little bit, as we talk about some of the dynamicism of the industry, and we don't have a slide on this in particular, but what we've seen is it's been encouraging is the fly wheel effective, lower price is stimulating demand in other markets, and I think we've seen a number of market commentators talk about the strength and energy storage the last quarter or two, and Tesla's mega pack numbers over the last two-queue resolve kind of reflect the improved economics of energy storage projects as prices for batteries fall, and that's kind of economics cheering economics at that year.

Speaker Change: As it relates to what we see on more of a micro level, and then I had mentioned earlier on, right, we don't control lithium prices, and the market is obviously working its way through a bit of oversupply over the last 12 months.

Speaker Change: But what we have also is a seasonality that's increasingly present in the market.

Ana Cabral: And we're bound to, we applied for a $100 million, a $100 million US dollar credit line with the NDS, which is going incredibly well because we sit within that, you know, framework of industrial policy. So that will be the primary source of funding, the duration is exceptionally, you know, a benign because it's development bank credit. So it's longer than 15 years. So it's a spread out duration rates also are very favorable.

Speaker Change: What you see on the top of the slide here represents Chinese production growth with the chemicals.

Speaker Change: The growth primarily, as we've discussed over time, occurs in the summer, in edge in the winter.

Speaker Change: It's not to say the Chinese production growth is not growing year over year it is, and we see that, and that's obvious in all the data points.

Speaker Change: But from a market impact perspective, we know that seasonal supply ramps in the spring and summer.

Ana Cabral: Today that line would have rates of about 8% local currency, which are even lower than our current dollar denominated rates. So they'll be our primary source of face to funding. And then in parallel, what we're also doing, just to show how active we've been on managing our capital structure for the current environment. If you look at our liquidity slide, you can see that we got long term shareholder debt, which was that that was generously given us by our shareholders when we were too pre operational, right?

Speaker Change: At the same time, when early buying pattern takes a dip and starts to then pick up later with the big pull into the Q4 EV cycle, which kind of has consistently occurred year after year, particularly in the fourth few.

Speaker Change: So, as Anna had mentioned, being in a commercially flexible position to take advantage of these buying and selling windows is exactly where we need to be, which as we've hit a number of times.

Speaker Change #100: It's exactly a function of building on our cadence, establishing ourselves a reliable and consistent supplier to the market, and leaving the rewards of that over time.

Speaker Change #101: Exactly, and I think just to cap this slide, to look at the bottom slide, it's very important to highlight the volume, the volume line charts that represent what we call, you know, electric vehicles, new energy vehicles, solving China. If you look at the various colors, each color is the volume so in any particular year.

Ana Cabral: So this debt has restrictive covenants, he has a higher rate. So we're also in active dialogue with the banking community to conduct liability management on that debt, where we're planning to replace that debt, even though it's benign mature in 2026. And you know, it was given to us by a shareholder, we're planning to replace that that with commercial banking that as well. So we're very active in the debt market as we speak at the moment. Development bank debt, you know, tank duration of over 15 years for the actual, you know, cornerstone centerpiece of building the blonde and commercial bank that for amongst other things conduct liability management on the shareholder debt.

Speaker Change #102: So, if you look at the bottom, we start the series in 2020, and then we go to 2021, 22 all the way to now, which means a very large amount of electric cars are actually offered to the customers, offer to consumers in the same buying pattern seasonality of combustion cars.

Speaker Change #102: Because consumer behavior regarding cars, regarding how their power, how their power hasn't changed, which means consumer like to buy cars in a fourth quarter.

Speaker Change #103: Like consumer like to buy things in a fourth quarter, that's classic retail consumer purchasing pattern.

Speaker Change #104: Now, what does that mean for our industry?

Speaker Change #105: It means the following, the sheer volume of materials required to deliver this significant volumes of cars in one season, which is the fourth quarter season, are no longer attainable to be stocked by the participants just once a year. And this is where the spring and fall stocking cycles emerge.

Speaker Change #106: The fall cycle stocking cycle is the classic stocking cycle, no matter what, that's why enemy happens in the midst of it, historically.

Speaker Change #107: But then the spring stocking cycle is emerging with a very clear pattern, as you can see in the data points mapped out and highlighted by math.

Unknown Executive: That will conclude our Q&A session. I'll hand the call back over to Matt.

Speaker Change #107: Because the industry, typically the supply chain participants do not have a strong balance sheet that would allow them to just follow the industry into one annual stocking period.

Speaker Change #107: So they distribute it throughout the year into spring and fall stocking cycles, because again, the sheer scale of electric cars has increased, choose dramatically over the last five years, and it hasn't been matched by consolidation in the supply chain away from batteries.

Matthew DeYoe: Thank you, Regina. And with that, we're going to close the call.

Speaker Change #108: Batteries are consolidated, but the rest of the supply chain just isn't.

Speaker Change #108: It's just a small balance sheet, that's a particular.

Ana Cabral: I appreciate everybody's time this morning and tuning in, and we will see you on the conference circuit over the coming weeks and months.

Speaker Change #109: So with that, I mean, I want to come up, I want to basically close with my, I want to present you with my closing comments.

Ana Cabral: Thank you. Thank you for the trust. Thank you for sticking with us. I mean, what we want to close with is the best yet to come. And you can see we've been joined by our very prominent neighbor. So it's now just me saying that Brazil is really one of the most fantastic jurisdictions for industrial production in the world. And we're hoping that all of you are shareholders will continue to benefit from that tremendously over the next couple of years.

Speaker Change #110: I think up clearly, I mean, Sigma did not benefit from any of this execution in its valuations.

Speaker Change #110: I mean, we're still trading like a pre-operational developer company.

Speaker Change #111: In other words, we are now a large producer, we reach cadence, we have credit worthiness of a very large producer at, you know, 5.8% in dollars a year.

Speaker Change #112: But none of this is reflected in our valuation, which, you know, still kind of looks like the valuation of a developer.

Speaker Change #112: So, essentially, probably that happens because we ramped up over the last year, which has been one of the most complex years for the lithium markets.

Speaker Change #113: It seemed so much changed, and it seemed so much lithium-price volatility.

Unknown Executive: That will conclude today's call, you may now disconnect.

Speaker Change #113: None of this we control.

Speaker Change #114: But when we do control our operational performance.

Speaker Change #115: So when measured against the two leading companies in our sector, clearly, no matter how you measured it, volumes for market cap, we are significantly undervalued.

Speaker Change #116: And we also want to take the occasion to welcome a billboard to our neighborhood, and when measured against the billboard, you can clearly see that we remain significantly under value.

Speaker Change #117: And we want to command the billboard from taking advantage of that and join our neighborhood acquiring Latin resources.

Speaker Change #118: We're very proud, very proud of you joining our emerging lithium valley territory.

Speaker Change #119: And we want to welcome to Brazil, essentially.

Speaker Change #119: And the next slide basically shows our transformation, right?

Speaker Change #120: We have become, we've gone from a construction site.

Speaker Change #121: That's what we were back in January 2023 to an industry.

Speaker Change #122: So we delivered on every single operational aspect that we had set ourselves to deliver to our shareholders. And from completing construction to completing the commissioning of the Module 3, which is the first and only dry stacking module in the entire industry, we have basically delivered on every metric.

Speaker Change #122: Just now this quarter, we initiated face to earthworks construction.

Speaker Change #122: We now also hit our annual cost guidance ahead of schedule, way ahead of schedule.

Speaker Change #123: So we're printing the costs in our financial statements that we guided earlier in a year.

Speaker Change #124: So I think the next step here, the next stop in our sequence of deliveries will be commissioning phase two, which will happen, you know, a year from now.

Speaker Change #124: So again, we want to thank you for the trust.

Speaker Change #124: We want to thank you for believing in us.

Speaker Change #125: We believe that this, you know, renewed wave of investments in Mitchel Valley just corroborates what we've been saying that we're operating one of the most fantastic jurisdictions for critical minerals and industrial battery materials in the world, given the overall operating circumstances of our country.

Speaker Change #125: And we are committed to continuing to deliver to all of the shareholders throughout, you know, the next quarters ahead of us.

Speaker Change #125: So I want to close this up, just moving to the Q&A.

Speaker Change #126: Yes, so Regina, happy to move to Q&A from here.

Speaker Change #127: At this time, if you'd like to ask a question, simply press star, followed by the number one on your telephone keypad.

Speaker Change #128: And our first question will come from the line of Steve Byrne with Bank of America.

Speaker Change #129: Please go ahead.

Speaker Change #130: Yeah, thank you.

Speaker Change #131: Good morning.

Speaker Change #132: You're your slide nine that shows your monthly pricing year to date.

Speaker Change #133: Is that 953 you show in areas that is that the month to date average for August or is that is that July?

Speaker Change #133: But much more importantly, I am curious if you're seeing any signs of price inflection.

Speaker Change #133: Or do you do you see it stabilizing down there any any any signs that things could tighten?

Speaker Change #134: And you know, I appreciate your comments about, you know, the world's going to need six sigma's for next year, you know, just given demand growth.

Speaker Change #134: But there is a lot of excess inventory in China.

Speaker Change #135: Do you have a view that if the industry doesn't slow operating rates?

Speaker Change #136: Which it doesn't seem like it is, do you have a view on, you know, when when this inflection might occur?

Speaker Change #137: If you're not seeing it yet, is it just seasonality that will drive that?

Speaker Change #137: I welcome your thoughts on this.

Speaker Change #138: Yes, Steve.

Speaker Change #138: I guess I'll start the.

Speaker Change #139: The data point you see there just reflects the value for August.

Speaker Change #140: So, which we press least the other day, it's a single data point in time.

Speaker Change #140: Not meant to be the average realized price for that specific quarter.

Speaker Change #141: I think your point and I'll let Anna talk for all the about signs from the market.

Speaker Change #142: But I mean, I think if you follow some of our comments from some of the comments from our public peers, I think what you would you see is a situation where a vast majority of our.

Speaker Change #143: The vast majority of our peers in Australia and Canada and in other markets are under water at current economics and we know that's not sustainable.

Speaker Change #144: It's always hard to tell when that specifically pays out from a supplier perspective, but if you can just look at some of the recorded numbers that we've seen in some of the discussions we have on cost targets, particularly from traceable sources.

Speaker Change #145: We know that a number of, a number of players out there are a bit upside down and I don't have to.

Speaker Change #145: Yeah, it goes back to traceability.

Speaker Change #145: This truck kind of said it all.

Speaker Change #146: I mean, you have a finite universe of producers in Australia, Canada, Brazil, Chile, Argentina that can deliver what we call traceable supply.

Speaker Change #147: And traceable really means a very low bar of like human rights adherence, no trial labor, we're not talking zero copy here right now that is actually the issue because as you can see, there's a gap between supply and demand at these price levels.

Speaker Change #147: But there are players, they're selling into this gap because they seem to have the cost structure to expand it.

Speaker Change #148: And based on the data of product inflow from Africa mainly, we're led to believe that this gap today with prices where they are has been mainly filled with what we call untraceable, materials.

Speaker Change #148: So this industry is now at a crossroads because you will have to collectively decide what kind of materials you want to use to build their sustainable green cars.

Speaker Change #149: I mean, if the industry decides that it's acceptable to use materials that, you know, in fringe human rights and child able rules and basic traceability rules to build green electric cars and sustainable electric cars.

Speaker Change #149: And if the industry believes that as the penetration rate increases, consumers are going to accept that, well, I think we're going to go in a certain path.

Speaker Change #150: But our personal view is that these traceability standards are going to continue to be highly enforced, especially by industry players.

Speaker Change #151: And I mean across the board, Chinese battery makers, South Korean battery makers, Japanese battery makers, that do deliver their materials into the, you know, top not supply chains into the leading supply chains in the world.

Speaker Change #151: So we believe that over time, you're going to see a movement where untraceable material either complies and becomes traceable or it just disappears from LED battery supply chains all together.

Speaker Change #151: And what fraction of global supply in it would you say is untraceable and is that happened to be higher on the cost curve?

Speaker Change #151: No, that's the whole point.

Speaker Change #152: The untraceable material in this current environment is coming from low cost producers.

Speaker Change #153: There's now, I think we've been seeing this quite a while in the market, but now the industry has a whole caught up with it.

Speaker Change #154: If you look at production inflows, there's been a whole segment coming out of a single African country just now.

Speaker Change #154: So clearly, there isn't an industrial facility off the standards that we have delivered in that one country.

Speaker Change #154: So it's artisanal production of lithium.

Speaker Change #154: Again, lithium is not rare.

Speaker Change #155: So because lithium is everywhere, I think it puts an extra burden on automakers to enforce traceability and enforce sustainability because again, just like what happened to cobalt, like what happened to tantalum before, all the way to blood diamonds, the risk is to basically kill the chicken, the lady, go to the mat.

Speaker Change #155: This consumer is kind of, you know, turning, you know, let's say resistant towards these cars because they'll be challenging their own sustainability resulting from the, let's say, traceability materials that go in building those cars.

Speaker Change #156: And we've been very vocal about that because this is the kind of behavior that risks the entire supply chain for all of us.

Speaker Change #156: And you've seen what happened to cobalt before.

Speaker Change #156: Thank you.

Speaker Change #157: And if I can just squeeze one in, the technology that you implemented should to recover more lithium out of your finds.

Speaker Change #158: Is this something that you had, you know, had anticipated in the past and just implemented, or was this just from your, from your engineers figuring out a way to recover that?

Speaker Change #158: Has it had any impact on what you would view as your production capacity because of that?

Speaker Change #158: It does.

Speaker Change #158: Because ultimately, I mean, it's not anything, let's say, exceptional that we've done.

Speaker Change #158: What we've done is the following.

Speaker Change #159: This media separation method is one that's constrained by the capacity of the concentrator, the centrifugator, which in our case is 250 tons an hour, 800%, but the design capacity is 237 tons an hour. So that's a constraint.

Speaker Change #160: So even if I lower my lithium off by grade, I'm still constrained by that capacity.

Speaker Change #161: I can only flow that tonnage of product per hour. So this is a characteristic of my industrial plant, the green type plant.

Speaker Change #161: Now, what have we learned?

Speaker Change #162: We learned that the higher the quality of the pre-feed into the centrifugator into the dense media separator, the higher our recovery. So what we're doing is a very elaborate system of screens and pre-screening and preparation of the feed that goes into that capacity, which unfortunately is fixed.

Speaker Change #162: It can already increase with an expansion.

Speaker Change #162: So that I can increase recovery.

Speaker Change #163: So I increase yield. By feeding better material, pre-purified pre-screened material, I am able to achieve better results in the dense media separation.

Speaker Change #163: That's what we're doing.

Speaker Change #163: And we've already gotten there.

Speaker Change #163: Now, we've hit the stride over 700 tons a day, which is something that in the past would have been called, you know, an exceptional day.

Speaker Change #164: Now, this is our regular day.

Speaker Change #164: And we're hoping to move that further upwards to even higher levels of daily production.

Speaker Change #164: So that's kind of what the depuration of the feed that goes into those centrifugators do for our production throughput for our yield.

Speaker Change #165: Thanks, Dave.

Speaker Change #165: We'll go to the next one.

Speaker Change #166: Our next question will come from the line of Joel Jackson with the BMO.

Speaker Change #167: Please go ahead.

Speaker Change #168: Morning, man.

Speaker Change #169: And thanks for the commentary on phase two.

Speaker Change #170: So a bit of a technical question.

Speaker Change #171: You know, there's always a bit of dispute going on in some of the land inside where you reserve is or where the affidels replace to.

Speaker Change #171: If you don't get some sort of agreement there.

Speaker Change #171: Can you proceed on phase two, which you have to move phase two different part of the resource?

Speaker Change #171: What will give you confidence legally for the company due to the advanced phase two as designed on the land you want to do it?

Speaker Change #172: Joel, I think there's a massive confusion on your end here regarding land dispute.

Speaker Change #173: What we are the only thing that's actually in there, it's essentially an or body that doesn't have anything to do with phase two.

Speaker Change #174: That sits between phase two and phase three.

Speaker Change #175: That's independent of those two phases.

Speaker Change #176: And that's nothing to do with sigma.

Speaker Change #177: So phase two is to the laughter of that or body and it's absolutely not connected to it.

Speaker Change #177: So we can go about our business irrespectively of what happened there.

Speaker Change #177: Now, what's the most important thing is that that area is actually controlled by me.

Speaker Change #178: So I have 51 cent of that area is a Brazilian corporation.

Speaker Change #178: So even if that were to become an issue, I would obviously resolve it favorably.

Speaker Change #178: So it's a non issue.

Speaker Change #178: So going back to it, essentially, what we are doing is just proceeding with our plan's business as usual.

Speaker Change #178: I mean, we got biohedral, which is phase two giant olabadi, which can be accessed by all sides.

Speaker Change #179: The mining concession belongs to Sigma, the overground belongs to a company that's affiliated to Sigma.

Speaker Change #179: So, you know, business is usual, pursuing business is usual.

Speaker Change #180: You might be referring to the noise my, let's say, former husband, try to make to create that sort of misunderstanding, but it's great that you raised this point because it's an opportunity for me to clear it out for all of the participants in this conference.

Speaker Change #181: That noise has nothing to do with Sigma.

Speaker Change #182: In fact, I have great news for everyone in attendance.

Speaker Change #183: My divorce has been declared quite a while ago.

Speaker Change #183: And as you can all see, I'm still here, sigma, you hear, there's been no implication to Sigma of the declaration of my divorce, the split of the assets and, you know, business is usual for all of us.

Speaker Change #184: So, you was just, as Shakespeare said, much a do about nothing.

Speaker Change #185: But it's understandable in, you know, divorce when one of the parties is less wealthy than the other one.

Speaker Change #185: Okay.

Speaker Change #185: So, my next question.

Speaker Change #185: That's published here.

Speaker Change #185: Thanks for the answer.

Speaker Change #185: You also, this is really a great and the car's harder.

Speaker Change #186: So, I think you absolutely hit them, you know, mid-24, as you said you would earlier this year.

Speaker Change #186: That's great.

Speaker Change #186: Now, you also had an SGNA target, you know, that you want to hit.

Speaker Change #186: And obviously, you know, when you have a downturn pricing, you want to get lean and tight.

Speaker Change #187: As soon as the SGNA is still staying up there, and there's also legal costs you're having.

Speaker Change #187: And can you talk about, you know, what can you do to get the SGNA down or to what you want to get to?

Speaker Change #188: Joel, take this one, right?

Speaker Change #189: And part of this is, it's hard when we, when we brought out the SGNA guidance, it was a bit of a discussion around what we needed to sustain phase one operations, but obviously we have intention to grow.

Speaker Change #190: And so, what we've been building is a, is a operationally and commercially sophisticated organization to give us the platform to double capacity and to triple capacity, right?

Speaker Change #190: Was we talk about things like internalizing our commercial capabilities and, I mean, just use that as an example, right?

Speaker Change #190: We've had to build out the commercial team.

Speaker Change #190: And the grand scheme of things, I think you can see the implications on the reduction to our sales expense on the income statement and what that means for real-dollar savings, but it also means some creep and costs on the back end.

Speaker Change #190: But look, scale is our friend at Sigma, and SGNA is a key area where we will be able to scale because we do not need to double our SGNA to double our production capacity.

Speaker Change #190: So we're kind of caught in a little bit of this framework of a growth company and trying to also be the right size for when that situation arises.

Speaker Change #190: But again, things like SGNA, you know, that, that on a part-time basis will not get fully cut.

Speaker Change #190: It will get pretty close as we as we grow.

Speaker Change #190: And that's part of the leverage in the operating model that we really are looking forward to.

Speaker Change #191: Anna, and thank you for that, Anna, I just bought from that one where I'll pass the baton.

Speaker Change #192: So I understand wanting to not give up on the growth, obviously.

Speaker Change #193: We all know what's happening with sponsoring markets right now and the lithium markets right now.

Speaker Change #193: What Anna would you have to see?

Speaker Change #194: Like, would you have to see many more months of these suppressed sponsoring prices before you make a decision to just really be done on SGNA, cost where you can hold on to pay one?

Speaker Change #194: Or face who's happening no matter what, no matter what.

Speaker Change #194: Price.

Speaker Change #195: Well, no, this is happening no matter what.

Speaker Change #195: I think this slide that you see here illustrates that well.

Speaker Change #196: In other words, if Sigma cannot operate properly, I think the whole industry is doomed, right?

Speaker Change #196: Because we're sitting to the right of green bushes on top of the ovarian terms of our low cost.

Speaker Change #196: So there's not whole lot more that we can do.

Speaker Change #196: We're going to continue to strive for lowering costs. But now focusing on unit cost reduction, meaning as we have these opportunities to drive further up our production yields, the costs are going to go down just as a result of a larger volume being sold.

Speaker Change #196: But when you go back to the project to face two projects per se, I mean, we got the liquidity to do it.

Speaker Change #197: And when you look at the capital efficiency of that project, it's essentially one questionable that we have to go ahead with it.

Speaker Change #198: I mean, just recapping this slide, there's absolutely nothing out there as efficient as of throwing a second line and going with it.

Speaker Change #199: If you add the gains that we would have by fixed cost dilutions to it, which we typically don't, but just doing SGNA dilution because the pretty obvious one, it becomes going to complete no brainer, which we don't add to our analysis.

Speaker Change #199: But there, it will all know it's there.

Speaker Change #200: You don't need two on us, two maps, two, you know, of D, what we call fixed infrastructure to do what we need to do with two lines, right?

Speaker Change #201: So as Matt was saying, scale it up, Fran, what we're doing, though, and you raise an excellent point, Joe, on discipline.

Speaker Change #202: We're pacing it.

Speaker Change #203: In other words, when we did the first project, and you remember that very well, we were racing it.

Speaker Change #204: So we're going to race versus space so sorry, we went from race to get to market, which is what we did in January 2022, as we raised the capital for phase one, we are in a race because it was a boom market of historical proportions and we knew we had to become operational and hit and achieve production in scale while the boom market was happening.

Speaker Change #204: And we did that a year ago.

Speaker Change #204: Now, we measured no efforts to do it.

Speaker Change #205: We pulled out what we call an acceleration plan for phase one that costs us $20 million extra, where we were flying equipment, you know, short circuiting steps on construction just to get there on time.

Speaker Change #205: And we turned the plan on in May, April, May 23, and by July, we had our first shipment out of the door.

Speaker Change #205: That was phase one.

Speaker Change #205: Now, very, very different environment.

Speaker Change #206: So it's interesting because the environment now reminds you, the environment that we had when we were doing the details engineering for phase one, which was tutoring COVID, not the best part of COVID, the earlier 2020, which is a very challenging environment.

Speaker Change #207: So we went back to the drawing board to the project execution plan timeline that we had banned, which is a 12 month comfortable, we called 12 to 15 month comfortable, and we already started project execution timeline, meaning we're not using the acceleration budget.

Speaker Change #207: Whatsoever.

Speaker Change #207: So we're going to receive equipment in the regularly times.

Speaker Change #207: We're going just to follow the regular trajectory of the schedule.

Speaker Change #208: So it's the based construction timetable versus the raised construction timetable because that is what allows us to actually manage the construction process in line with our own liquidity capabilities.

Speaker Change #208: And so far we're doing, you know, quite quite well with that.

Speaker Change #209: And again, for any questions, press star one and your next question comes from the line of Andrei Kroupnik with Drakewood, please go ahead.

Speaker Change #210: Hi, Ana, just follow up on what you were just discussing with Joel.

Andrei Kroupnik: So looking at your financials for the second quarter, your capital spend was quite light.

Speaker Change #212: So when do you expect the capital intensive phase?

Speaker Change #213: This phase to expansion to begin?

Speaker Change #214: And also do you still keep on intending funding this?

Speaker Change #215: We sort of more short term trade finance line?

Speaker Change #215: So is there a plan to add more debt?

Speaker Change #215: Oh, no, thank you for the questions.

Speaker Change #215: It is a very good question.

Speaker Change #215: The cap typically in the in out in these constructions, the context really picks up at the very end.

Speaker Change #215: And you can see by the by the previews, the previous project, right?

Speaker Change #216: You have a bulk at the beginning, which relates to deposits or prepayments of lonely items.

Speaker Change #216: Earthworks is quite inexpensive.

Speaker Change #216: The total earthworks cost is $8.9 to $9 million.

Speaker Change #216: And that's basically it.

Speaker Change #216: And so you basically pay for earthworks, pay for for that engineering.

Speaker Change #216: And then you're depositing towards equipment.

Speaker Change #216: In our case, we've got a break for our chemical zero.

Speaker Change #216: You need, you know, and you need levels of sustainability.

Speaker Change #216: So what does that mean?

Speaker Change #216: We did, we know, well, and obviously now we have credit.

Speaker Change #216: We are, we are company that has revenues and delivers cashflow. So the credit worth in it plus our, you know, super special green deck plant in our green credentials attracted some of the largest global OEM parts manufacturers to work with us on this project.

Speaker Change #217: So we're no longer required to deposit to prepay for lonely items, which is something we have to do in phase one.

Speaker Change #218: Some of the lonely items had to be fully paid before they even began construction in their respective supplier manufacturing line.

Speaker Change #218: So we're saving some money there.

Speaker Change #218: So the lonely item bill for phase one was around $15 million.

Speaker Change #219: And we think the lonely item bill here is somewhat expanded, but you will be a bit smaller than that.

Speaker Change #219: So as you can see, lonely items and earthworks are the two main elements of cost of this project.

Speaker Change #219: If you look at the project execution plan, as I see here, throughout third quarter, fourth quarter, we're just going to have the bigger numbers hitting us on the first quarter as equipment starts getting delivered. And then you have to fully pay for the equipment.

Speaker Change #220: So it's kind of a backloaded capex, as you can see, and we put on the screen the full capex so that you can see the comparison to and you can also see Joel, Joel's point, you see the construction acceleration plan, that was the raised portion of it, which we eliminated 20 million bucks.

Speaker Change #221: So this time is the pay, meaning we don't have that acceleration plan in place.

Speaker Change #222: It's there, it's quoted, but we're not going to need to trigger it because we're just based.

Speaker Change #223: We know Rush to sell cheaply, you know, you just put it that way.

Speaker Change #224: So the second part, is there a plan to take on any more debt, or you're just going to do it from the existing trade finance plan?

Speaker Change #225: Oh, no, sorry, I didn't answer that.

Speaker Change #226: We are in ongoing discussions with, well, we announced it actually.

Speaker Change #227: We are in ongoing discussions with Brazil's development bank, the NDS, the NDS is embarked in a very successful, new industrialization driving Brazil.

Speaker Change #227: We are part of that.

Speaker Change #228: It's centered on green industry, green producers on generation of industrial jobs, just to put in perspective, Sigma just created an entire territory in the poorest region of the country. We have about 13,000 direct and indirect jobs there, 1,500 direct jobs.

Speaker Change #228: So we're top of the line on the new industrialization development plan of Brazil.

Speaker Change #228: And we're bound to, we applied for a $100 million, a $100 million US dollar credit line with the NDS, which is going incredibly well because we sit within that, you know, framework of industrial policy.

Speaker Change #228: So that will be the primary source of funding, the duration is exceptionally, you know, a benign because it's development bank credit. So it's longer than 15 years.

Speaker Change #228: So it's a spread out duration rates also are very favorable.

Speaker Change #228: Today that line would have rates of about 8% local currency, which are even lower than our current dollar denominated rates.

Speaker Change #228: So they'll be our primary source of face to funding.

Speaker Change #228: And then in parallel, what we're also doing, just to show how active we've been on managing our capital structure for the current environment.

Speaker Change #229: If you look at our liquidity slide, you can see that we got long term shareholder debt, which was that that was generously given us by our shareholders when we were too pre operational, right? So this debt has restrictive covenants, he has a higher rate.

Speaker Change #230: So we're also in active dialogue with the banking community to conduct liability management on that debt, where we're planning to replace that debt, even though it's benign mature in 2026.

Speaker Change #231: And you know, it was given to us by a shareholder, we're planning to replace that that with commercial banking that as well.

Speaker Change #231: So we're very active in the debt market as we speak at the moment.

Speaker Change #232: Development bank debt, you know, tank duration of over 15 years for the actual, you know, cornerstone centerpiece of building the blonde and commercial bank that for amongst other things conduct liability management on the shareholder debt.

Speaker Change #232: That will conclude our Q&A session.

Speaker Change #233: I'll hand the call back over to Matt.

Speaker Change #234: Thank you, Regina.

Speaker Change #235: And with that, we're going to close the call.

Speaker Change #236: I appreciate everybody's time this morning and tuning in, and we will see you on the conference circuit over the coming weeks and months.

Speaker Change #237: Thank you.

Speaker Change #238: Thank you for the trust.

Speaker Change #239: Thank you for sticking with us.

Speaker Change #240: I mean, what we want to close with is the best yet to come.

Speaker Change #241: And you can see we've been joined by our very prominent neighbor.

Speaker Change #242: So it's now just me saying that Brazil is really one of the most fantastic jurisdictions for industrial production in the world.

Speaker Change #243: And we're hoping that all of you are shareholders will continue to benefit from that tremendously over the next couple of years.

Speaker Change #244: That will conclude today's call, you may now disconnect.

Q2 2024 Sigma Lithium Corp Earnings Call

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