Q2 2024 Sigma Lithium Corp Earnings Call

August 16, 2024

Today's call is being recorded and is broadcast live on Sigma's website.

Unknown Executive: Call is being recorded and is broadcast live on Sigma's website.

Courted and is broadcast live on sticking with 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 O.

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

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.

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.

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

Speaker Change: Thank you, Regina.

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

Matthew DeYoe: 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 Q 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. And additionally, earnings reference purchase presentations may exclude certain non-core and non-repeating 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: After the market closed yesterday, we published our Q2 financials, which.

Speaker Change: What's your available both through sense Peter.

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

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 and our operations.

Speaker Change: And Additionally earnings referenced in this day purchased presentation, sorry, Nate excludes certain noncore and nonrecurring items reconciliations to the most comparable ifr S financial measures and other associated disclosures, including the descriptions of adjustments can be found in the back of the press release.

Ana Cabral: With that, I will pass it over to Ana. Hi, good morning everyone. I am very very pleased to present to we've our second quarter of 2024 quarterly result. We are actually delighted that we have managed to achieve all around operational excellence, thriving in our financial results despite what it is a legitimate bright environment that we just do not control. So what we're 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 excellence. So starting with the volume, we've heard of increased the cadence of volume, so to 22,000 tons of materials shipped every 30 to 35 days.

al: With that I will pass it over to al.

Speaker Change: Hi, good morning, everyone.

Speaker Change: And good morning, everyone.

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

Speaker Change: Quarterly results were actually.

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

Speaker Change: Thank you for joining us for our second quarter 2024 earnings conference call.

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

Speaker Change: So what we're gonna showing these results is that we have well we control all of our operational elements.

Speaker Change: Fully managed and actually demonstrating our operational excellence.

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 2Q financials, which are available both through SEC and CDER.

Speaker Change: So.

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

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

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

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

Speaker Change: 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.

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 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 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. So these elements are all interlinked.

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: Thanks to our ability to continue to maintain this export track records another.

Speaker Change: Another very important point in delivering our strategy was the ability to continue to increase.

Speaker Change: With that, I will pass it over to, Hi, good morning, everyone.

Speaker Change: Ales price freedom relative to our competitors, that's a key element of our strategy and it is a result of increased commercial asserted.

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 it's sort of Ms and therefore achieve a sales price points. So these elements are all interlinked performance a favorable credit lines and then price premium performance.

Ana Cabral: Performance of favorable credit lines and then price premium performing. On the cost from, 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 the chip prices wasn't again something we control, but wasn't as favorable. So it means that by closing this cash margins, we do have our cost structure well in the control. And a debt, 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 year, 40 year, 2022, and we're just in the second quarter, which just shows, you know, the direction of this trajectory.

Speaker Change: On the cost front on the operational front. We are just delighted to have been able to to print Oh, 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: 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.

Speaker Change: Again, something we control, but it wasn't as favorable so we he means thereby boosting this cash margins, we do have our cost structure well under control and of that I mean again, we're very proud of having reached a cost target for 'twenty 'twenty four I have the schedule.

Speaker Change: 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.

Unknown Executive: Call is being recorded and is broadcast live on Sigma's website.

Unknown Executive: 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: 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: 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.

Speaker Change: Meaning where 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 year for the year of 2022, and we're just in the second quarter. We just shows you notice it.

Matthew DeYoe: Thank you Regina and good morning everyone.

Matthew DeYoe: Thank you for joining us for our second quarter 2024 earnings conference call.

Matthew DeYoe: As Regina noted on the call with me today is Company CEO and Co-chairperson Ana Cabral.

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

Matthew DeYoe: After the market closed yesterday we published our two Q 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. And additionally, earnings reference purchase presentations may exclude certain non-core and non-repearing 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: Fraction 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 clean 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 lost the word, which means we sent out 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: Would you 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.

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

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 work, which means we send our people back to their families safe it would be doing that for an entire year, which is a new.

Speaker Change: Incredible achievement for a young operation.

Ana Cabral: With that I will pass it over to Ana. Hi good morning everyone. I am very very pleased to present to we've our second quarter of 2024 quarterly result. We are actually delighted that we have managed to achieve all around operational excellence, thriving in our financial results despite what it is a legitimate bright environment that we just do not control. So what we're 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 excellence.

Ana Cabral: That has cut up both of us to the very top of the metals and mining industry rankings as measured by ICML, the International Council of Metal and Mining's companies. There's just one company that reigns above us on these combined ratings.

Speaker Change: That has kept the bulker does to the very top of the metals and mining industry ranking as measured by ICM Ma'am the international Council of metals and mining companies. There's just one company that range above us on these combined Rage, Inc.

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

Matthew DeYoe: 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 cost 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 Biobara initiated their operation.

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.

Matthew DeYoe: And additionally, earnings reference purchase presentations may exclude certain non-core and non-repearing items.

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

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

Matthew DeYoe: 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 starting with the volume, we've heard of increased the cadence of volume so to 22,000 tons of materials 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 range relative to our competitors.

Speaker Change: And we have been delivering the most sustainable lithium in the world. Our Allegiant became a brand for all attributes related to sustainability and traceability not one company in our space has April has been able to deliver what was called.

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

The Trinity of metal producers since 2018, when our Deerfield Barbara initiated their operations. So.

Ana Cabral: So, 60 years have passed. Billions of dollars are being 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: Two years have passed.

Speaker Change: Billions of dollars are being invested in the lithium the industry quite a lot of hype a massive cyclical but no. One company has been able to deliver the Trinity that we actually have deliberate which demonstrates how rare and achievement. This is.

Ana Cabral: Hi good morning everyone.

Ana Cabral: I am very very pleased to present to we've our second quarter of 2024 quarterly result.

Ana Cabral: 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 so these elements are all interlinked. Performance of favorable credit lines and then price premium performing.

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 merit quantification of our ability to operate our drop of the CDL industrial and mining facilities, adhering to the highest operational standards. We were able to surpass the IPM-ranking, dozens of much larger and much more mature methods of 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 flag was cut for us.

Speaker Change: 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 it's being driven driving your thought performance.

Speaker Change: Throughout 2024, we're very very proud to present this slide because the numeric quantification about ability to operate a grasp of the CDO industrial and mining facilities are gearing the highest operational standards.

Speaker Change: We were able to surpass India I scan them ranking.

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

Ana Cabral: On the cost from, 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 the chip prices wasn't again something we control, but wasn't as favorable. So it means that by closing this cash margins, we do have our cost structure well in the control. And a debt, I mean, again, we're very proud of having reached our cost target for 2024.

Speaker Change: <unk> 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 two straight out of the gate behaves.

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

Speaker Change: Like it's teas and producer Commission like a season producer and ramp up like the season producers. 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 are.

Ana Cabral: There's several operational milestones that we will be showing here today, which are actually rarely achieved by a company 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 for product sales, which are a whole lot 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 the second quarter, which means we're able to manage the cadence and reliability of our shipments.

Ana Cabral: 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 year, 40 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 cultural excellence in high standards amongst our employees.

Speaker Change: Just one of these the next stage.

Speaker Change: So, Starting with the volume, we further increased the cadence of volume sold to 22,000 tons of material shipped every 30 to 35 days.

Speaker Change: Talks about our cadence of volumes shipped 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 chemicals zero Greenlit.

Speaker Change: 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.

Speaker Change: Another very important point in delivering our strategy was the ability to continue to increase the sales price premium relative to our competitors. That's a key element of our strategy and it's a result of increased commercial authority. 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. Performance, favorable credit lines, and then price premium performance.

Speaker Change: Jim will concentrate up both in the first and the second quarter, 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.

Speaker Change: 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.

Ana Cabral: And that starts with a clean 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 lost the word, which means we sent out people back to their families safe. It would be doing that for an entire year, which is an incredible achievement for a young operation. That has cut up both of us to the very top of the metals and mining industry rankings as measured by ICML, the International Council of Metal and Mining's companies. There's just one company that reigns above us on these combined ratings.

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

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 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 it boards the ship.

Speaker Change: 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.

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 culture of excellence and high standards amongst our employees.

Speaker Change: O F O b sales at warehouse, which again are a hallmark of trustworthiness and reliability between Sigma any guidance when we transfer ownership of material at board to its final client before keyboards, the ship, which again is another operational maturity.

Speaker Change: 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 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.

Ana Cabral: Which again is another operational material milestone rarely achieved by a company just one year old. 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 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 forums of exercise and assertiveness selling to end users, selling to counterparty trading agencies but trading companies as agents.

Speaker Change: 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.

Speaker Change: So rarely achieve backup and did just one year old.

Speaker Change: The next page.

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

Speaker Change: As a color coding because you just highlight two different moments in our one year history again.

Speaker Change: If you could please turn to the next page.

Speaker Change: We are now season producer, we demonstrate shipment by shipment on this page that we have these changes in the liability are consistently shipping 22000 tons.

Speaker Change: So I think the summary of where we are is, again, we we were able to combine, three attributes.

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

Speaker Change: Increasingly more favorable terms and rates.

Speaker Change: And again in <unk>.

Speaker Change: 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 trade or that was the principal moved into.

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 Biobara initiated their operation. So, 60 years have passed. Billions of dollars are being invested in the lithium industry, quite a lot of hype.

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

Speaker Change: Agents are at.

Ana Cabral: And up again, this last shipment, this was capped as one year was capped by sending the last shipment to Mitsubishi, which is a very large industrial cadet. So in Japan, they just associated to tell each other out of makers for easy strategy and easy development. So we get to strive, and again, we want to also lead 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 of September 30th, which is basically just 45 days away. Distract records that we establish allow 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 again this last shipment. This this was capped at one year was capped by sending the last shipment to Mitsubishi which is a very large industrial Kate add so in Japan did just associated to shelf with two other automakers for easy strategy and easy development. So we get into <unk>.

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 again, we want to also leaves you year.

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

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 members of the supply chain because it's the result of this commercial flexibility.

Ana Cabral: We're very, very proud to present this slide because in the merit quantification of our ability to operate our drop of the CDL industrial and mining facilities, adhering to the highest operational standards. We were able to surpass the IPM-ranking dozens of much larger and much more mature methods of 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 flag was cut for us.

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'd be equally distributing our our shipments in.

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

Speaker Change: In into Japanese South Korea, and Chinese coins.

Ana Cabral: Essentially, we had to straight out the gate, behave like a season producer, commission like a season producer, and ramp up like a season producer. There's several operational milestones that we will be showing here today which are actually rarely achieved by a company just 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 for product sales which are a whole lot of the operational maturity of a season producer.

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

Ana Cabral: The next page, again, is a derivative of the previous page as 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, where we continue to criminalize or continue to increase sales price premium relative to peer-licking producers. We've been maintaining an average of 10% price premiumization today, which again are a result of this trading reliability of the season as a season producer. And then, more importantly, the financial flexibility of our own credit and customer financing lines, because that allows us to navigate what we call means cycles in a cycle, meaning the purchase cycles of the spring and fall that takes place in this industry.

Again these are derivatives of the 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 where we are today.

Speaker Change: We have been maintaining low production costs consistently, and we have been delivering the most sustainable lithium in the world.

Ana Cabral: So what we're 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 excellence. So starting with the volume, we've heard of increased the cadence of volume so to 22,000 tons of materials shipped every 30 to 35 days.

Speaker Change: Continue to bring <unk> to continue to increase sales price premium relative to peer lithium producers producers will be maintaining an average of 10% price realization to date, which again are a lot of.

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 terms in export linked credit, meaning credit lines linked to our ability to continue to maintain this export track record.

Ana Cabral: We have sold 52,000 five of the tons of our typical 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. 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 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 it boards the ship.

Speaker Change: A result of this change.

Speaker Change: Cadence 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 mini cycles in the cycle, meaning the purchase cycles of the spring and fall that take place in this industry.

Ana Cabral: Which allows us to sell into the purchase cycle, and therefore achieve the price premiumization. So we are now able to start to monetize gradually what turns out to be a chemically superior quality of our quintuple zero-litre concentrate. And at that, we turn you to the next page, where we basically numerically demonstrate that this high quality is what drives premium pricing. But more importantly, it is a win-win situation for our customers, because our customers say 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.

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

Speaker Change: Gradually what what turns out to be a chemically superior quality of our Q4 zero lithium concentrate and adapt with turning to the next page.

Speaker Change: Where are we where we basically.

Speaker Change: <unk> demonstrated that this high quality is what drives premium pricing.

Speaker Change: But more importantly is 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.

Speaker Change: In other words, a high quality is chemically Nashville, and translate into this 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% in raw materials when refining lithium hydro.

Ana Cabral: 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 forums 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 capped as one year was capped by sending the last shipment to Mitsubishi which is a very large industrial cadet so in Japan they just associated to tell each other out of makers for easy strategy and easy development.

Ana Cabral: So buy a ton of our product from Sigma means that the client saves approximately 20% to 30% in raw materials when refining lithium hydroxide chemicals. Everything else stays 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 customers in a full win-win relationship.

Outside Canada calls everything else staying the same.

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

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

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 on perfecting this plant in a 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 tack plant.

Speaker Change: The next page talks a bit about the operational improvements 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 in a continuous effort and as you recall it starts with.

Speaker Change: It started with the dry stacking so.

Ana Cabral: So we get to strive and again, we want to also lead 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 of September 30th which is basically just 45 days away. Distract records that we establish allow 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: Our became a brand for all attributes related to sustainability and traceability.

Speaker Change: 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 which means we dry stack are five.

Speaker Change: 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.

Speaker Change: So 60 years have passed.

Speaker Change: Billions of dollars have been invested in the lithium industry, quite a lot of hives, 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: On the next page, then, I would encourage you to look at our operational highlights.

Speaker Change: 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: 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.

Speaker Change: <unk> in our Ultrafine produced by the Green tax loans.

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 tack GMS, we again have been affecting further adjustments in further pre-sacking the plant. Essentially, we have been able to reprocess the fines that were generated in the early commissioning period, which have higher grades.

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

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

Speaker Change: Now those operational improvements 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.

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 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. The next page, again, is a derivative of the previous page as you can tell, on the last chart, you have basically the quantification of these two different moments of commercial strategy.

Speaker Change: And reducing just shipment intervals and this is kind of how we're going to get to our annual guidance now within the within the Green Tech Vms, we again have been affecting further up further adjustments and further perfecting this block essentially we.

Speaker Change: 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.

Speaker Change: <unk> been able to reprocess.

Speaker Change: Define 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 improvements in the circuits increased daily productivity.

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

Ana Cabral: First, we had the first six months, and then on this page, we demonstrate where we are today, where we continue to criminalize or continue to increase sales price premium relative to peer-licking producers. We've been maintaining an average of 10% price premiumization today, which again are a result of this trading reliability of the season as a season producer. And then more importantly, the financial flexibility of our own credit and customer financing lines, because that allows us to navigate what we call means cycles in a cycle, meaning the purchase cycles of the spring and fall that takes place in this industry.

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 dry stack, would be otherwise left inside of tailings. So by recycling material that had zero cost, because it was just essentially tailings, but we had dry stack that we are able to gradually increase our throughput of high period, typical zero lithium concentrate. So some of these results of discontinue improvement have already been reflected in our third quarter performance.

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.

Speaker Change: Dailies.

Speaker Change: But we had dry stack that we are able to gradually increase.

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 are hallmarks 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 were able to manage the cadence and reliability of our shipments.

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 a robust guidance of 60000 tons of lithium materials to be.

Ana Cabral: Which allows us to sell into the purchase cycle, and therefore achieve the price premiumization. So we are now able to start to monetize gradually what turns out to be a chemically superior quality of our quintiple zero-litre concentrate. And at that, we turn you 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 say significantly if they acquire our product, even at a premium price versus the product of our competitors.

Ana Cabral: Hence, the 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: Shipped in the third quarter that we plan to hit.

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

Ana Cabral: And I think lastly, regarding the crusher, we keep 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 aligned with basically the best crusher designed 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 drop crusher openings, which means last fine, which means higher yield, which means higher productivity. So that's what it all means.

Speaker Change: Lastly.

Speaker Change: 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.

Speaker Change: Changing flow sheet.

Speaker Change: Create a new setup.

Speaker Change: Which is in line with that.

Speaker Change: The best Cross designs in the world, they're separate screens from the motor again, improving crusher efficiency are benefiting from the customized crusher we created.

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 buy a ton of our product from Sigma means that the client saves approximately 20% to 30% in raw materials when refining lithium hydroxide chemicals. Everything else stays 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 customers in a full win-win relationship.

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 decreased cadence is a result, not of one great change but of a mirror.

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

Areas of improvements 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 David to go over our financial highlights.

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 tons sold, which implies a CIA equivalent realized price to quarter about $894 tons. The top line was supported by strong cross management, which we'll get into in a moment, but our FOB cash operating margins came in at about 54 percent, while adjusted cash, but down margins were close to 30 percent. Production on the quarter total just over 49,000 tons.

David: 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 milestone rarely achieved by a company that's just one year old.

David: Thank you Ron.

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

David: Our plan 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%.

David: During the quarter totaled just over 49000 tons.

Matthew DeYoe: The company has spent energy familiarized; sorry, let's 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-done margins to balance out this volatility. What you're seeing on the left is an allocation of even-done 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 sorry, I'll go to the next slide here.

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

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 tack GMS, we again have been affecting further adjustments in further pre-sacking the plant.

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.

Speaker Change: Full breakdown of us naturally found in the appendix.

Message here is underlying margins for the business are far more stable than what the headlines would indicate.

Matthew DeYoe: As the extreme market volatility is second half 23 each, it slows, and we establish a regular shipping cadence. We expect these headlines should subside and ultimately revert as we come back from market route. On the right side of the slide, you had seen our FOB margins, which is the said balance out against peers with Sigma happily finding its way towards the upper end of echelon costs. This is predicated on the hard work that I will discuss here.

Speaker Change: As the extreme market volatility of second half 'twenty three slaw.

Speaker Change: And we establish a regular shipping cadence we expect these headwinds should subside and ultimately revert as we come back for a market route.

Ana Cabral: 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%. 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 of tailings.

Speaker Change: On the right side of the slide you have seen our fob margins, which as we had 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'll discuss here.

Speaker Change: Yeah.

Matthew DeYoe: I'm quite pleased to be presenting the cost line 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 ton, FOB of 420, and Plankgate costs of $370. The numbers in front of you for 2Q represent a reduction of 22 percent to 24 percent from our 4Q reported levels, which is where we were when we issued this guidance. As production ramps, the second half of the year, we would expect the operating leverage to drive incremental improvements from these levels.

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

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

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

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

Speaker Change: 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.

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

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

Ana Cabral: So by recycling material that had zero cost, because it was just essentially tailings, but we had dry stack that we are able to gradually increase our throughput of high period, typical zero lithium concentrate. So some of these results of discontinue improvement have already been reflected in our third quarter performance. Hence the 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> for 'twenty.

Speaker Change: And plant gate costs of $3 70.

Speaker Change: The numbers in front of you.

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

Speaker Change: As production ramps in the second half of the year, we wouldn't be expect the operating leverage to drive incremental improvements from these levels.

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 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 cost and productivity initiative to drive home with that cost structure, and this drives us to get back to exactly what I'm talking about as it relates to building an operational culture of excellence.

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

Speaker Change: 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: This track record that we established allows us to basically tap into these leading global supply chains for lithium.

Speaker Change: We will continue to work through this.

Cost and productivity initiatives to drive home with better cost structure and this drives it gets back to exactly what I talked about as it relates to building an operational culture.

Speaker Change: Excellent.

Matthew DeYoe: This is not our data; it's suspension marks, but I think it's a nice representation of where we think we've set and where we are delivered. 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. An internalizing our commercial efforts and keeping a focus on productivity is not only helped us generate revenue and cocks, but it's also helped right size our SGNA structure, which you see on the right side. Notably, SGNA is down with an additional roughly 24% from the second half of '23 levels.

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.

The next slide is a bit of the same view.

Speaker Change: Though it's a waterfall to reported costs.

Speaker Change: Again, going direct to, you know, downstream members of these supply chains because it's the result of this commercial flexibility.

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

Speaker Change: 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.

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 leads to our higher confidence that will be reaching 60,000 tons of lithium concentrate sales in the third quarter.

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

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

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.

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 tons sold, which implies a CIA equivalent realized price to quarter about $894 tons. The top line was supported by strong cross management, which we'll get into in a moment, but our FOB cash operating margins came in at about 54 percent while adjusted cash, but down margins were close to 30 percent. Production on the quarter total just over 49,000 tons.

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

Matthew DeYoe: And as this productivity plays out, we see further proof of competitive cost position. And, as we've said again, on the prior slide, as it relates to the cost curve, as provide a benchmark.

Ana Cabral: So it means that by closing this cash margins, we do have our cost structure well in the control.

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

You know the cost curve as provided by benchmark.

Matthew DeYoe: So what does this all kind of mean? It helps drive what 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 of $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. Firstly, there was a reduction to our payables of nearly 14.5 million dollars. And the second was the delay in receivables associated with two of our shipments.

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

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 in net revenues.

Speaker Change: Cash cost during the quarter totaled 33 million.

Matthew DeYoe: The company has spent energy familiarized, sorry, let's 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-done margins to balance out this volatility. What you're seeing on the left is an allocation of even-done margins for our business, assuming boats settled accurately without these provisional adjustments.

Speaker Change: Again represents a reduction of nearly $12 5 million from our <unk> 23 levels.

Speaker Change: Working capital did prove to be a headwind in 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 the delay in receivables associated with two of our shipments.

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

Matthew DeYoe: As for the pro-formal bridge, you can see that we've since received both payments shortly after quarter close. CapEx on the quarter was roughly $9 million, which represents some payments on the Phase Two extension. As well as some of the brownfield mine and plant investments that Anna had mentioned on the prior slides.

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 each, it slows, and we establish a regular shipping cadence. We expect these headlines should subside, and ultimately revert as we come back from market route. On the right side of the slide, you had seen our FOB margins, which is the said balance out against peers with sigma happily finding its way towards the upper end of echelon costs. This is predicated on the hard work that I will discuss here.

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.

Honor: With that I'm going to pass it back to honor and we will talk through a bit bigger.

Ana Cabral: With that, I'm going to pass it back to Anna, and we'll talk through a bit.

Ana Cabral: We liquidity position of the company. 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 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 export link.

Anna Cabral: Liquidity position of the <unk>.

Anna Cabral: <unk>.

Anna 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. The math was described and we discussed up regarding sales cadence and cost controls.

Ana Cabral: And a debt, I mean, again, we're very proud of having reached our cost target for 2024.

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

Speaker Change: In other 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.

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

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

Ana Cabral: It 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. More importantly, and that's the key point, we have decreased the cost of these export-linked credit to $5.85 total. Fixed in dollars, which is a very, very favorable rate for a company in the first year. And again, that's a sharp contrast to 1515% that we were granted in our very first straight line in January 2024. This very first straight line is being retired long, long ago, but it just shows the quick evolution of our robust credit worth.

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

Matthew DeYoe: As production ramps, 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 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 cost and productivity initiative to drive home with that cost structure, and this drives us to get back to exactly what I'm talking about as it relates to building operational culture of excellence.

The words, we could pay them all back today, if they were all to you.

Speaker Change: More importantly, and Thats a key point.

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

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

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.

Speaker Change: And again, that's 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: And that starts with a clean metric that's highly beneficial to them, which is safety.

Matthew DeYoe: This is not our data, it's suspension marks, but I think it's a nice representation of where we think we've set and where we are delivered. 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. An internalizing our commercial efforts and keeping a focus on productivity is not only helped us generate revenue and cocks, but it's also helped right size our SGNA structure, which you see on the right side.

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

Ana Cabral: And this as we continue to demonstrate sales cadence and cost. 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 removed the opinion out of the conversation.

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

Ana Cabral: Again, we're very proud of having completed the full year with no fatalities, zero fatalities and zero accidents without lost the word, which means we sent out people back to their families safe. It would be doing that for an entire year, which is an incredible achievement for a young operation.

Ana Cabral: That has cut up both of us to the very top of the metals and mining industry rankings as measured by ICML, the International Council of Metal and Mining's companies.

Speaker Change: First, we had the first six months, and then on this page, we demonstrate where we are today, where we continue to premiumize, we continue to increase sales price premium relative to pure lithium producers.

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

Speaker Change: We've been maintaining an average of 10% price premiumization today, which again, are a result of this cadence, reliability as a seasoned producer, 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 take place in this industry, which allow us to sell into the purchase cycle and therefore achieve the price premiumization.

Ana Cabral: There's just one company that reigns above us on these combined ratings.

Speaker Change: And execute on doubling its production capacity by expanding its industrial facilities in Brazil.

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.

Matthew DeYoe: Notably, SGNA is down with an additional roughly 24% from the second half of 23 levels. And as this productivity plays out, we see further proof of competitive cost position. And as we've said, again, on the prior slide, as it relates to the cost curve as provide a benchmark.

Speaker Change: So we are now able to starting 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.

Speaker Change: We have a very very privileged position in this industry, where we actually have a industrial lie 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.

Speaker Change: But more importantly, it's 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 these cost savings for our customers and their supply chains. So buying a ton of product from Sigma means that the client saves approximately 20-30% in raw materials when refining lithium hydroxide chemicals, everything else staying the same.

Ana Cabral: They're quite unique and not easily combinable in our industry.

Speaker Change: They remove the opinion out of the conversation mathematics is just a data number doesn't carry in your opinion. So what we did with tracked announced projects in Capex announcements and we calculated what we call capex efficiency ratio.

Matthew DeYoe: So what does this all kind of mean? It helps drive what 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 of $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: 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 in 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 and 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: 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.

Speaker Change: The next page talks a bit about the operational improvement that we have been able to effect 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.

Speaker Change: So.

Speaker Change: <unk> 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 all around the world.

Speaker Change: 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: 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.

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

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

Ana Cabral: We initiated our shipment last year in operating in large scale.

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.

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 to bubble up and again the lower the quadrant.

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

Ana Cabral: The smaller the bubble and again the lower the quadrant, the better the project is. So we're kind of sitting in a Leo 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 capital infrastructure inside the gate.

Speaker Change: That said 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 one.

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

Ana Cabral: We have been maintaining low production cost consistently, and we have been delivering the most sustainable lithium in the world.

Speaker Change: Now, within the Green Tech GMS, we again have been effecting further adjustments and further perfecting this plant. 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%. 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.

Speaker Change: Second in the next slide you can see D I areal demonstration.

Ana Cabral: Our lithium became a brand for all attributes related to sustainability and traceability.

Speaker Change: But we also utilize that circuit to concentrate material that, if we didn't dry stack, would be otherwise left inside a tailings dam. 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.

Speaker Change: 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>.

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

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 Biobara initiated their operation.

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 export link. It is basically comprised of those export link trade lines, which are drawn but are entirely sitting in our treasury.

Ana Cabral: So, 60 years have passed.

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.

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.

Ana Cabral: Billions of dollars are being invested in the lithium industry, quite a lot of hype.

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. 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.

Speaker Change: Again, improving crusher efficiency and benefiting from the customized crusher we created at the plant, which has 1,200 milliliters of drop crusher opening, which means less fines, which means higher yield, which means higher productivity.

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

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 capital infrastructure with 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.

Speaker Change: 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.

Ana Cabral: 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: 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: 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 credit to $5.85 total. Fixed in dollars, which is a very, very favorable rate for a company in the first year. And again, that's a sharp contrast to 1515% that we were granted in our very first straight line in January 2024. This very first straight line is being retired long, long ago, but it just shows the quick evolution of our robust credit worth. And this as we continue to demonstrate sales cadence and cost, of life.

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.

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: 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 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 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 phase two extension in the timetable that we have 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 we're conducting what would a very important point, a very, very important point that we undertook doing phase one as well, which to conduct the suppression of the what we call this savanna, the desertic, sanitary, cactus, bush vegetation, adhering to the very high standards of environmental sustainability. So we're doing what we call an inventory of speeches, we're doing a fauna capture, so to find a fauna speeches which are basically reptiles. So we capture them, we inventory them, and we deliver them to the appropriate authority. 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 construct a phase one. So that's kind of how we operate, and 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. On the next slide, it's just a recapping right where we're going. Well, we are clearly on a very disciplined approach to reach a hundred thousand 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 of industrial areas. The capping 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. 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 name plate capacity of 250,000 tons of LCE parallel to that. So 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.

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 the 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 phase two expansion in in the timetable that we.

Ana Cabral: We were able to surpass the IPM-ranking dozens of much larger and much more mature methods of 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 flag was cut for us.

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: And this is actually measurable. And this is why you love these industries because they removed 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 in US dollar millions by the production capacity in tons for tons of lithium concentrates all around the world.

Speaker Change: A very very important point that we undertook during 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 adhering to the very high standards of environmental sustainability. So we're doing what we call.

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

Ana Cabral: 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. 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: 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: The smaller the bubble and again the lower the quadrant, the better the project is. So we're kind of sitting in a leo 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.

Speaker Change: Lithium.

Speaker Change: But it's equivalent production.

Essentially by 20% to 26, one production line at a time, we showed that we show to the sites or industrial site. We have all the area we need there there's one square kilometer of industrial areas.

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: 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 capital 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 capital infrastructure with 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.

Speaker Change: One production line per 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.

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.

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 generation.

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.

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

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

Ana Cabral: 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 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 phase two extension 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 worked on the way we're conducting what would a very important point a very very important point that we undertook doing phase one as well which to conduct the suppression of the the what we call this savanna the desertic, sanitary, cactus, bush vegetation, adhering to the very high standards of environmental sustainability so we're doing what we call an inventory of speeches we're doing a fauna capture so to find a fauna speeches which are basic basically reptiles so we capture them we inventory them and we deliver them to the appropriate authority 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 construct a phase one so that's kind of how we operate and 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 on the next slide it's just a recapping right where we're going well we are clearly on a very disciplined approach to reach a hundred thousand 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 of industrial areas the capping 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 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 name plate capacity of 250,000 tons of LCE parallel to that so 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: The next phase. It's 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 Matthew. 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 has delivered almost 4% growth in the year in electric vehicles always like BVs, BVs sales and China's bounds to reach 60% of the global EV market by the end of the year.

The next page.

Speaker Change: Essentially talks a bit about the market and gives us a bit of color of the way were seeing things that I want to share that page with massive 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.

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

Speaker Change: Thank you, Ana.

Speaker Change: 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 of the quarter of about $894 million.

Speaker Change: 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%.

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

Matt: The company is spent energy familiar.

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

Matt: Sorry, go to the next slide here.

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

Matt: We have taken steps to harmonize our EBITDA margins to balance out this volatility.

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

Speaker Change: China is bound to reach 60% of the global E&P market by the end of the year.

Ana Cabral: Overdating 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 has taught that in 2024, just five years later, twice a year already, EV sales surpass sales of combustion cars three or four times during this year already, represented over 50% of overall car sold in China.

Speaker Change: Overtaking Europe, which means that.

Speaker Change: China is.

Speaker Change: Which is a result actually of a consistent policy, making of consistent policymaking 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.

Speaker Change: EV sales surpassed sales of combustion cars.

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

Speaker Change: Overall.

Speaker Change: Our car sold in China is a remarkable achievement and is that I will encourage you to look at the slide on the left so the global demand is is is essentially up despite the behavior of EV sales in the western.

Ana Cabral: It's a remarkable achievement. And at that, I'll 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 tons of LC equivalent by the end of 2024. If China continues just on the face it is, we're going to need 1.4 million tons of LC 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.

Speaker Change: What you're seeing on the left is an allocation of EBITDA margins for our business, assuming both settled accurately without these provisional adjustments.

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

Speaker Change: 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.

Speaker Change: By the end of 2024, if if if China continues to just on the face. It is we're going to need one.

Speaker Change: 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.

Speaker Change: Sigma too.

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 of LC in 2019. And that is the volume that is added to the market in the bear case that prevailed today, just basically having only China as a locomotive, 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: 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, just basically having only China.

Speaker Change: As a locomotive, which basically shows you that.

Speaker Change: This market.

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

Ross: Carbonate equivalent demand back five years ago in 2025, all of you remember the first time Ross you put out the 1 million ton LTE demand for 2025 in 2019 and that was the biggest bouquets of the whole industry, well know thats our reale.

Matthew DeYoe: All of you remember the first time rock you put out the 1 million ton LC demand for 2025 in 2019, and there was the biggest bouquet of the whole industry. Well, now that's our reality. In fact, it's our bear case. So I want to just recap these numbers because sometimes we get lost in the day-to-day of the abs 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 is 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 prices 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 megapack numbers over the last two key resolve kind of reflect the improved economics of energy storage project as prices for batteries fall and that's kind of economics cheering economics at the here as it relates to what we see on more of a micro level as then I had mentioned early on right we we don't control that the prices in the market is obviously working its way through a bit of overspie over the last 12 months but what we have also is a seasonality that's increasingly present in the market what do you see on the top of the market?

Ross: In fact, it'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.

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

Ana Cabral: The next phase It's 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 Matthew. I'll comment on this slide and then Matthew comment on a few other slides. So share the section with my partner here.

Speaker Change: Yes.

Speaker Change: Build on that a little bit as we talk about some of the dynamicism in the industry.

Speaker Change: I have a slide on this in particular, but what we've seen as have been encouraging as the flywheel effect of 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.

Ana Cabral: 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 4% growth in the year in electric vehicles always like BVs, BVs sales and China's bounds to reach 60% of the global EV market by the end of the year. Overdating 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.

The improved economics of energy storage projects as prices for batteries fall and that's kind of economic sharing economics of it here as it relates to what we see on more of a micro level and then I had mentioned earlier.

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.

Speaker Change: 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 the summer and edge in the winter, 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 and all of the data point, but from a market.

Matthew DeYoe: This slide here represents Chinese production growth with the chemicals. The growth primarily, as we've discussed over time, occurs in the summer and edges in the winter. Not to say the Chinese production growth is not growing year over year; it is, and we see that that's obvious in all the data points. But from a market impact perspective, we know that seasonal supply grants in the spring and summer at the same time when early buying patterns take a dip and start to then take up later with the big pull into the Q4 EB cycle, which kind of has consistently occurred year after year, particularly in the fourth year. 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 date, 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.

Ana Cabral: 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 has taught that in 2024, just five years later, twice a year already, EV sales, surpass sales of combustion cars, three or four times during this year already, represented over 50% of overall car sold in China. It's a remarkable achievement.

Speaker Change: Impact perspective, we know that seasonal supply ramps in the spring and summer at.

Speaker Change: At the same time when early buying pattern takes adept and starts to then pick up later with the big pull into the Q4, <unk> cycle, which kind of is.

Speaker Change: As consistently occurred year after year, particularly in the fourth Q. So.

John: 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 date, which as we've said a number of times is exactly a function.

Ana Cabral: And at that, I'll 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 tons of LC equivalent by the end of 2024. If China continues just on the face it is, we're going to need 1.4 million tons of LC equivalent just by next year.

John: 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 for a market rally.

John: 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.

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

John: Building on our cadence to establishing ourselves as a reliable and consistent supplier to the market.

John: I'm quite pleased to be presenting the cross-slide to you this morning.

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.

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 sold in 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 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 a fourth quarter, by consumers like to buy things in a fourth quarter. That's classic retail consumer purchasing pattern.

Speaker Change: The 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 a very large amount of electric cars.

Ana Cabral: 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 of LC in 2019. And that is the volume that is added to the market in the bear case that prevailed today, just basically having only China as a locomotive, 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: Our actually offered to the customers offer to consumers in the same buying patterns seasonality.

Speaker Change: <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.

Matthew DeYoe: Now what does that mean for our industry means the following: the sheer volume of materials required to deliver this significant volume 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 cycle emerged. The fall fashion stocking cycle is the classic stocking cycle; no matter what, 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 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 or stocking period.

Industry it means the following.

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

No longer attainable to be stopped by the participants just once a year and this is where this spring and fall stocking.

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

Speaker Change: Michael emerge default patchy stocking cycle was the classic stocking cycle, we know math, that's why LNG happens in the midst of it historically, but then the spring stocking cycle.

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

Matthew DeYoe: So I want to just recap these numbers because sometimes we get lost in the day-to-day of the abs 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 is 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 prices 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 a megapack numbers over the last two key resolve kind of reflect the improved economics of energy storage project as prices for batteries fall and that's kind of economics cheering economics at the here as it relates to what we see on more of a micro level as then I had mentioned early on right we we don't control that the prices in the market is obviously working its way through a bit of overspie over the last 12 months but what we have also is a seasonality that's increasingly present in the market what do you see on the top of the market?

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.

Matthew DeYoe: So they distribute it throughout the year into spring and fall stocking cycles because, again, this year's 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 by the rest of the supply changes. Isn't it just a small balance sheet set the petitions.

Speaker Change: 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: 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 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.

Speaker Change: So with that I mean, I want to come up but I wouldn't have basically closed with my mic.

Speaker Change: Presented with my closing comments.

Speaker Change: 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.

Speaker Change: In other words.

Ana Cabral: The next page talks about our cadence of volume shift which again, we were able to establish that reliable cadence for product sales which are a whole lot of the operational maturity of a season producer.

Matthew DeYoe: This 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 not to say the Chinese production growth is not growing year over year it is and we see that that's obvious and all the data point but from a market impact perspective we know that seasonal supply grants in the spring and summer at the same time when early buying pattern takes a dip and starts to then take up later with the big pull into the q4 eb cycle which kind of has consistently occurred year after year particularly in the fourth year 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 date which as we've hit a number of times is exactly a function of building on our cadence is establishing ourselves a reliable and consistent supplier to the market and reaping 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 sold in China if you look at the various colors each color is the volume so in any particular year.

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 a 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 seemed so much change, and it seemed so much let you 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 Billboard, you can clearly see that we remain significantly undervalue.

Speaker Change: We ramped up over the last year, which has been one of the most.

Speaker Change: Complex years for the mature markets. It seems so much change and you've seen 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.

Speaker Change: Clearly no matter how you measure this.

Gilbert So: 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 Bill where you can clearly see that we remain significantly undervalued and we want to combine the over from taking advantage of that and joining our neighborhood.

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

Speaker Change: Acquiring license 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, because 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 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 face to earthworks construction. We now also hit our annual cost guidance. I had a schedule away.

Speaker Change: And the next slide basically shows our transformation right up we have because we've gone from a construction side, that's where we were back in.

Matthew DeYoe: So if you look at the bottom we start 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 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 by consumer like to buy things in a fourth quarter that's classic retail consumer purchasing pattern. Now what does that mean for our industry means the following the sheer volume of materials required to deliver this significant volume 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.

Speaker Change: January 2023 to an industry leader. So we delivered on every single operational aspect that we had set ourselves to deliver.

Speaker Change: To our shareholders that means from completing construction to completing the commissioning of the module three which is the first and only dry stacking module Indian tire industry.

Speaker Change: We have basically delivered on every metric up just now this quarter, we initiated phase III earthworks construction.

Speaker Change: 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 Plantgate Costs of 3-7.

Speaker Change: 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.

Ana Cabral: I had a 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 face to, 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. 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.

Matthew DeYoe: And this is where the spring and fall stocking cycle emerged the fall fashion stocking cycle is the classic stocking cycle no matter what 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 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 or stocking period.

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

Speaker Change: Resection score critical minerals.

Speaker Change: In industrial battery materials in the world given the overall.

Speaker Change: Operating circumstances off.

Speaker Change: Our country.

Ana Cabral: And we are committed to continuing to deliver to all of the shareholders throughout, you know, the next quarters ahead of us.

Speaker Change: And we are committed to continuing to deliver.

Matthew DeYoe: So they distribute it throughout the year into spring and fall stocking cycles because again this year's 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 by the rest of the supply changes isn't it's just a small balance sheet set the petitions.

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

Ana Cabral: So I want to close this.

Speaker Change: Yeah.

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

Unknown Executive: Just moving to the Q&A. Yes, so Regina, happy to move to Q&A from here.

Speaker Change: Numbers in front of you for 2Q represent a reduction of 22%.

Regina.

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

Steve Byrne: 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 Think 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 nine fifty-three you show in there? Is that is that the the month to date average for August or is that is that July?

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.

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 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.

Steve Byrne: Yes. Thank you good morning.

Speaker Change: 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.

Steve Byrne: But much more importantly, I'm curious if you're seeing any signs of price inflection or do you see it stabilizing down there 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 per 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, 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 that? Yeah, is it just seasonality that will drive that?

Ana Cabral: That was possible because of our enhanced credit worthiness at the end of the first quarter.

Speaker Change: But much more importantly, I am curious if youre seeing.

Speaker Change: Any signs.

Speaker Change: Of price inflection.

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

Speaker Change: Any signs that things could tighten and.

Ana Cabral: So 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 it boards the ship.

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 change and it seemed so much let you 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 under value.

Speaker Change: I appreciate your comments about.

Speaker Change: You know that the world's going to need.

Speaker Change: Six Sigma that's for next year.

Speaker Change: 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.

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

Speaker Change: When when this inflection might occur if youre not seeing it yet is it just seasonality that will drive that are welcome. Your thoughts on this this is I guess I'll start the <unk>.

Matthew DeYoe: 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, 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 in 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 you know, that's not sustainable. 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 in some of the discussions we have on cost targets, particularly from traceable sources.

Speaker Change: 24% from our four key reported levels, which is where we were when we issued this guide. 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: And we also want to take the occasion to welcome a billboard to our neighborhood. And when measured against billboard, you can clearly see that we remain significantly under value. And we want to command billboard from taking advantage of that and joining our neighborhood acquiring Latin resources. We're very proud, very proud of you joining our emerging lithium valley territory. And we want to, you know, welcome to Brazil, especially.

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

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

Speaker Change: Which we did press release the other day, it's a single data point in time is not meant to be the average realized price for that specific.

Speaker Change: Quarter.

Anna Cabral: Your point and I'll, let Anna talked broadly about time to market, but any.

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

Speaker Change: We will continue to work through this.

Speaker Change: Cost and Productivity Initiatives to Drive Home a Better Cost Structure, and this drives and gets back to exactly what Ana had talked about as it relates to building an operational culture of excellence.

Speaker Change: 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.

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

Ana Cabral: Which again is another operational material milestone rarely achieved by a company just one year old.

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

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

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

Speaker Change: 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 has not only helped us generate revenue and COGS, but it's also helped right size our SG&A 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.

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: 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 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 like human rights adherence. No trial 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're selling into this gap because they seem to have the cost structure to expand it, and based on the data of product and flow from Africa mainly, we're led to believe that this gap today, with prices where they are, has been mainly seen.

Speaker Change: We know that.

Speaker Change: A number of a number of players out there a bit upside down and faster 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.

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

Speaker Change: You know, as we said, again, on the prior slide as it relates to, You know, the cost curve as provided by.

Ana Cabral: 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 of every 30 to 35 days which drive our export credit lines increasingly more favorable firms and rates.

Ana Cabral: Just now this quarter we initiated face to earthworks construction. We now also hit our annual cost guidance. I had a schedule away. I had a 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 face to, which will happen, you know, a year from now.

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

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

Ana Cabral: And again, it underpins our commercial independence and commercial assertiveness.

Speaker Change: So we started the quarter with $108 million in cash, which we supplemented with nearly $46 million in net revenue.

Speaker Change: Cash costs on the quarter totaled $33 million, which again represents a reduction of nearly 12.5 million from our 3Q23 level, working capital did prove to be a headwind to the quarter, which was a function of two primary, 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: As for the pro forma bridge, you can see that we've since received those payments shortly after quarter closed.

Speaker Change: 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.

Ana Cabral: 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 forums of exercise and assertiveness selling to end users, selling to counterparty trading agencies but trading companies as agents.

Speaker Change: And we'll talk through a bit the liquidity transition of the company.

Ana Cabral: And up again, this last shipment, this was capped as one year was capped by sending the last shipment to Mitsubishi which is a very large industrial cadet so in Japan they just associated to tell each other out of makers for easy strategy and easy development.

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

Speaker Change: 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.

Speaker Change: 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.

Speaker Change: In other words, robust access to export link credit, so robust liquidity.

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

Speaker Change: Traceable really needs a very low bar of like human rights of the year and no travel 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.

Speaker Change: 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.

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

Speaker Change: 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.

Speaker Change: 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: Distract records that we establish allow 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 this is actually measurable.

Speaker Change: But it just shows the quick evolution of our robust credit worthiness as we continue to demonstrate sales cadence and cost distance.

Speaker Change: 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: And this is why we love these indexes, because they remove the opinion out of the conversation.

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

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 in US dollar millions by the production capacity in tons for tons of lithium concentrate all around the world.

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 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 off our country. And we are committed to continuing to deliver to all of the shareholders throughout, you know, the next quarters ahead of us.

Ana Cabral: So I want to close this.

Speaker Change: 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: This gap because they seem to have the cost structure to withstand it.

Speaker Change: 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: And based on the data prep product 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 will have to collectively decide.

Speaker Change: So we're kind of sitting in a league of our own in terms of capital efficiency here.

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

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 aerial demonstration, of our site, our industrial site in Brazil.

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

Ana Cabral: And that's what we're going to do now, and that's what we're going to do, and that's what we're going to do now, and that's what we're going to do now, and that's what we're going to do now. materials.

Speaker Change: So when you see the layout, you can see that you have in green the existing inside, 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: 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.

Speaker Change: So that lowers the construction costs 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.

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 generation.

Ana Cabral: 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 infringe human rights and child labor rules and easy 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 hiding for, especially by industry players.

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 cadent 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.

Speaker Change: 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.

Speaker Change: We already started it.

Speaker Change: So if we look at the current slide, we have work underway.

Speaker Change: We're conducting a very important point, a very, very important point that we undertook during Phase I as well, which 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.

Ana Cabral: The next page, again, is a derivative of the previous page as you can tell, on the last chart, you have basically the quantification of these two different moments of commercial strategy.

Speaker Change: What kind of materials Q1 two.

Speaker Change: Use to build their sustainable Green cars, I mean, if the industry decides that 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 car.

Unknown Executive: Just moving to the Q&A.

Unknown Executive: Yes, so Regina, happy to move to Q&A from here.

Steve Byrne: 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 Think 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 nine fifty three you show in there? Is that is that the the month to date average for August or is that is that July?

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

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

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 banks.

Ana Cabral: We've been maintaining an average of 10% price premiumization today, which again are a result of this trading reliability of the season as a season producer.

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 means cycles in a cycle, meaning the purchase cycles 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 premiumization.

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-not 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 LED batteries supply chains altogether. And what fraction of global supply and I 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.

Ana Cabral: So we are now able to start to monetize gradually what turns out to be a chemically superior quality of our quintiple zero-litre concentrate. And at that, we turn you to the next page, where we basically numerically demonstrate that this high quality is what drives premium pricing.

Matthew DeYoe: But much more importantly, I'm curious if you're seeing any signs of price inflection or do you do you see it stabilizing down there 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 per 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, 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 that, yeah, is it just seasonality that will drive that?

Speaker Change #100: <unk> do deliver their materials into the.

Speaker Change #100: 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 #100: Altogether.

Speaker Change #100: Yeah.

Speaker Change #100: And what fraction of global supply into would you say is traceable and as that happens to be higher on the cost curve.

Speaker Change #100: So we're doing what we call inventory of species.

Ana Cabral: But more importantly, is a win-win situation for our customers, because our customers say 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 buy a ton of our product from Sigma means that the client saves approximately 20% to 30% in raw materials when refining lithium hydroxide chemicals.

Speaker Change #100: We're doing fauna capturing.

Speaker Change #100: So if you find a fauna species, which are basically reptiles.

Speaker Change #100: So we capture them, we inventory them, and we deliver them to the appropriate authorities.

Speaker Change #100: 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.

Speaker Change #101: 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 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.

Ana Cabral: 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. 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.

Ana Cabral: Everything else stays the same.

Matthew DeYoe: 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, 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 in 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 you know, that's not sustainable, 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 in some of the discussions we have on cost targets, particularly from traceable sources.

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

Speaker Change #102: So clearly 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 alto makers to enforce traceability and enforce sustainability.

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, the lady, go to the met with these 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 or the materials that go in building those cars. And we've been very vocal about that because this is the kind of behavior, the risks, the entire supply chain for all of us.

Speaker Change #102: Because again, just like what happened to cobalt like what happened to tantalum before.

Speaker Change #103: All the way to blood diamonds, the riskiest, you basically kill the chicken. The later goals and that is as consumers kind of you know.

Speaker Change #103: Turning you know, let's say resistant towards these cars because it'll be challenging it's their own sustainability.

Resulting from the let's say.

Speaker Change #103: Traceability of the materials that go in building those cars.

Speaker Change #104: 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 you about before.

Steve Byrne: And you've seen what happened to cobalt before. Thank you.

Matthew DeYoe: 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 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 like human rights adherence. No trial 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're selling into this gap because they seem to have the cost structure to expand it and based on the data of product and flow from Africa mainly we're led to believe that this gap today with prices where they are has been mainly seen. [inaudible] materials.

Thanks, and if I can just squeeze one in their technology that.

Steve Byrne: And if I can just squeeze one in, the technology that you, this technology that you, you know, implemented to recover more lithium out of your, your finds is, 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? Does it have any impact on what you 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. The dense media separation method is one that's constrained by the capacity of the concentrated, the centrifugator, which in our case is 250 tons an hour, more at 100%, but the design capacity is 237 tons an hour, so that's a constraint.

Speaker Change #105: This technology that you have.

Speaker Change #104: Implemented.

Speaker Change #106: To recover more lithium out of out of your defined.

Speaker Change #107: Is this something that you had you know had anticipated in the past and just.

Speaker Change #108: We 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 growth.

Speaker Change #108: Oh.

Speaker Change #109: It does because ultimately it's not anything let's say exceptional that we've done what we've done is the following.

Speaker Change #109: The dense media separation method.

Speaker Change #110: <unk> is one that is constrained by the capacity of the concentrator disinterested gaiter, which in our case is 250 ton.

Speaker Change #110: And 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 that capacity. They can only flow that tonnage of product per hour. So this is a characteristic of my industrial.

Ana Cabral: 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 in fringe human rights and child labor rules and easy 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.

Ana Cabral: 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 only be increased with an expansion, so that I can increase recovery.

Speaker Change #111: Plant the Green tax now what have we learned we learned that the higher the quality of the pre feed into destin, Tricia gate or into the dense media separation or the higher our recovery. So we'll be doing is a very elaborate system of screens and in pre pre screening and preparation.

Speaker Change #111: Of the feed that goes into that capacity, which unfortunately is fixed he can only decrease with an expansion so that increase.

Ana Cabral: But our personal view is that these traceability standards are going to continue to be hiding for, 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 top not 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 LED batteries supply chains altogether.

Speaker Change #111: Increased recovery, so I increased yields by seeking better material pre purified pre 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.

Ana Cabral: So I increase yield by even 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 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 the depuration of the feed that goes into those centrifugators does for our production throughput for our yield.

Speaker Change #111: We've hit a stride over 700 tons, a day, which is something that in the past would have been called.

Speaker Change #111: And exceptional they know this is a regular base and we're hoping to move that further upwards.

To even higher levels of daily production close to 800 today. 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.

Speaker Change #111: So that's kind of how we operate.

Speaker Change #111: And you can clearly see here in the pictures that work being conducted by our own proprietary team.

Speaker Change #111: So that's an expertise we have in our own environmental department.

Ana Cabral: And what fraction of global supply and I 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.

Unknown Executive: Thanks, Dave.

Speaker Change #111: Thanks, Dave we'll go to the next one.

Speaker Change #111: On the next slide, it's just a recapping, right?

Joel Jackson: We'll go to the next one. Our next question will come from the line of Joel Jackson with BMO. Please go ahead. Morning, man. And I think it's all about your face, too. 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, too. 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? 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 #111: Where are we going?

Speaker Change #112: Our next question will come from the line of Joel Jackson with BMO. Please go ahead.

Speaker Change #112: Well, we are clearly on a very disciplined approach to reach 100,000 tons of lithium carbon equivalent production essentially by 2026.

Speaker Change #112: One production line at a time.

Speaker Change #112: We showed you the product.

Speaker Change #112: We showed you the site, our industrial site. We have all the area we need there. There's one square kilometre of industrial area. The complex infrastructure on site supports two lines.

Joel Jackson: Good morning, Matt.

Joel Jackson: Thanks, very much on phase II.

Speaker Change #114: So a bit of a tanker question.

Joel Jackson: There is obviously a bit of dispute going on at some of the land inside where your reserve is or where the asset is for phase two.

Joel Jackson: Get some sort of agreement there.

Ana Cabral: 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. 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 met with these 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 or the materials that go in building those cars. And we've been very vocal about that because this is the kind of behavior, the risks, the entire supply chain for all of us. And you've seen what happened to cobalt before.

Speaker Change #115: Can you proceed on phase two which you have to move phase two different part of the resource.

Speaker Change #115: We will give you confidence legally for the company due to the advanced phase II as designed on the land do you want to do it.

Steve Byrne: Thank you.

Ana Cabral: Joel, I think there's a massive confusion on your end here regarding land disputes. Well, we're the only thing that's actually in there. It's essentially a norbody that doesn't have anything to do with Phase Two. That sits between Phase two and Phase three. That's independence of those two phases. And that's nothing to do with Sigma. So phase two is to the laughter of that or body and is 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 #115: Joe I think this theres a massive confusion on your end here regarding land disputes.

Speaker Change #116: 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.

Speaker Change #117: The lapping of the ore body and is absolutely not connected to chew. 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% of that area is a Brazilian corporation, so even if that.

Ana Cabral: So I have 51 center that area is a Brazilian corporation. So even is that word to become an issue, I would obviously resolve it favorably to Sigma. So it's a non-issue.

Speaker Change #117: Were to become an issue I would obviously resolve it favorably to Sigma so it's a non issue so going back to it essentially what we are what we are doing is just proceeding with our plans business as usual I mean, we got Baidu, which is phase two giant ore body, which can be accessed by all sides.

Ana Cabral: And if I can just squeeze one in, the technology that you, this technology that you you know, implemented to recover more lithium out of your, your, the finds is, 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, does it have any impact on what you view as you're as you're production capacity because of that. It does, because ultimately, I mean, it's not anything, let's say, exceptional that we've done.

Speaker Change #117: 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.

Ana Cabral: So going back to it essentially, what we are doing is just proceeding with our plan's business as usual. I mean, we got bairro, which is phase two giant or body, which can be accessed by all. 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 for seeing business as usual. 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 an opportunity for me to clear it out for all of the participants in this conference.

Speaker Change #117: 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.

Speaker Change #117: We're hoping to hit that by this time next year.

Speaker Change #117: 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.

Speaker Change #117: So very, very well planned, thoroughly executed.

Speaker Change #117: 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.

Speaker Change #117: The mining concession belongs to Sigma.

Speaker Change #117: Over ground belongs to a company that's affiliated to Sigma so.

Speaker Change #117: So we have to exercise the discipline that has become our last name here at SIGMA.

Speaker Change #118: It's business as usual preceding business as usual you might be referring to the noise might.

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 down, which means we dry stack our fines and our ultra-fines produced by the green tack 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.

Speaker Change #119: Let's say for my husband tried 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: 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.

Ana Cabral: What we've done is the following. The dense media separation method is one that's constrained by the capacity of the concentrated, the centrifugator, which in our case is 250 tons an hour, more at 100%, 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. So this is a characteristic of my industrial plant, the green type plant.

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

Ana Cabral: 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. So he 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.

Speaker Change #119: The next page, essentially talked a bit about the market and gives you a bit of color of the way we're seeing things.

Speaker Change #119: And I want to share that page with Matt a bit.

Speaker Change #119: I'll comment on the slide and then Matt will comment on a few other slides.

Speaker Change #119: Right, 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 splits of the asset.

Speaker Change #119: So I'll share the section with my partner here.

Speaker Change #119: You know business as usual for all of US. So it was just as Shakespeare's SaaS much do about nothing but it's understandable in a divorced when one of the parties its less wealthy than the other one.

Ana Cabral: Now, within the green tack GMS, we again have been affecting further adjustments in further pre-sacking the plant.

Ana Cabral: 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 only be increased with an expansion, so that I can increase recovery. So I increase yield by even better material pre-purified pre-screened material.

Joel Jackson: Okay, so the next question that's published here. Thanks for the answer. You also, it's really great. The car's hard; I think you absolutely hit them, you know, mid 24, as you said you would earlier this year. It's such 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 or haven't, can you talk about, you know, what can you do to get the SGNA down more to what you want to get to.

Speaker Change #120: Okay. So my next question just publish here.

Ana Cabral: But we also utilize that circuit to concentrate material that if we didn't dry stack would be otherwise left inside of tailings.

Speaker Change #120: Financer.

You also just 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 Wanna get lean and tight.

Speaker Change #120: 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, PEV sales, and China is bound 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.

Speaker Change #120: 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 #120: No one has 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.

Speaker Change #120: It's a remarkable achievement.

Speaker Change #121: It seems like the SG&A is still staying up there.

Ana Cabral: So some of these results of discontinue improvement have already been reflected in our third quarter performance.

Speaker Change #122: It is also the legal costs are having can you talk about.

Speaker Change #123: 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 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 an operationally and commercially sophisticated organization to give us the platforms to double capacity and to triple capacity, right? As we talk about things like internalizing our commercial capabilities. And I mean issues 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.

Speaker Change #124: Joe I'll take this one right and part of this is.

Speaker Change #125: It's hard when we product 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.

Ana Cabral: 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 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 the depuration of the feed that goes into those centrifugators do for our production throughput for our yield. Thanks, Dave.

Ana Cabral: Hence the 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 #126: And so what we've been building is a.

Speaker Change #126: Operationally.

Speaker Change #126: 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: Again, improving crusher efficiency and benefiting from the customized crusher we created at the plant, which has 1,200 milliliters of drop crusher openings, which means last fine, which means higher yield, which means higher productivity.

Speaker Change #126: 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 costs on the backend, but scale is our friend at Sigma and S.

Ana Cabral: So that's what it all means.

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

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

Joel Jackson: We'll go to the next one. Our next question will come from the line of Joel Jackson with BMO. Please go ahead. Morning, man. And I think it's all about your face, too. 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, too. If you don't get some sort of agreement there, can you proceed on phase two, would you have to move phase two to different part of the resource?

Matthew DeYoe: Thank you.

Matthew DeYoe: So in the second quarter, we reported revenues of $45.9 million on nearly $53,000 tons sold, which implies a CIA equivalent realized price to quarter about $894 tons.

Matthew DeYoe: The top line was supported by strong cross management, which we'll get into in a moment, but our FOB cash operating margins came in at about 54 percent while adjusted cash, but down margins were close to 30 percent.

Matthew DeYoe: But look, scale is our friend at Sigma and SGNA 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. So what 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 per ton basis will not get fully cut, and Apple 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.

Matthew DeYoe: Production on the quarter total just over 49,000 tons.

Speaker Change #126: 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 what kind of caught in a little bit of this a free.

Matthew DeYoe: The company has spent energy familiarized, sorry, let's 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 settlements.

Speaker Change #126: Framework of a growth company and trying to also be the right size for when that situation arises, but again things like SG&A.

Joel Jackson: 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 disputes. Well, we're the only thing that's actually in there. It's essentially a norbody that doesn't have anything to do with phase two. That sits between phase two and phase three. That's independence of those two phases.

Speaker Change #126: On a per ton basis will not get fully cut Apple 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 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 sponsoring markets right now and the listed 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 not an SGNA. Well, no, it's just 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?

And thank you for that.

Bob: Bob 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 in the lithium market is right now what Ana would you have to see like would you have to see many more months at these depressed spodumene prices before you make a decision to just really lean on the SG&A cost where you can hold on to phase one.

Joel Jackson: And that's nothing to do with sigma. So phase two is to the laughter of that or body and is 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 center that area is a Brazilian corporation. So even is that word to become an issue, I would obviously resolve it favorably to sigma.

Ana: Or at least use happening no matter, what no matter the price.

Ana: And at that, I will encourage you to look at the slide on the left.

Ana: No. This is happening no matter what I think this slide that you see here illustrates that well in other words.

Ana: So the global demand is essentially, despite the behavior of EV sales in the Western car market, the global demand is clearly set on a path to reach 1.1 million tons of LCE equivalent by the end of 2024.

Speaker Change #129: Sigma cannot operate profitably I think the whole industry is doomed right because we're sitting to the right of green versus on top of Pilbara in terms of our low cost. So theres 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 unit cost reduction meaning as.

Ana Cabral: Because we're sitting to the right of green bushes on top of Bill Byrne in 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. I mean, as we have these opportunities to drive further up our production yields, the costs are going to go down just as a result of, you know, larger volumes being sold. But when you go back to the project, to face two projects per se, I mean, we got the liquidity to do it.

Joel Jackson: So it's a non-issue. So going back to it essentially, what we are doing is just proceeding with our plan's business is usual. I mean, we got bairro, which is phase two giant or body, which can be accessed by all The mining concession belongs to Sigma. The overground belongs to a company that's affiliated to Sigma. So, you know, it's business is usual for seeing business is usual. 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 an opportunity for me to clear it out for all of the participants in this conference.

We have these opportunities to drive further up our production yields the costs are going to go down just as a result of a.

Speaker Change #129: Larger volumes being sold but when you go back to the project.

Speaker Change #129: Phase two project per se.

Speaker Change #130: I mean, we got the liquidity to do it.

Ana Cabral: And when you look at the capital efficiency of that project, it's essentially, you know, one questionable that we have to go ahead with it. I mean, just recapping this life, there's absolutely nothing out there that's as efficient as throwing a second line and going with it. 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 the pretty obvious one, it becomes then a complete no brainer, which we don't add to our analysis, but there it will all know it's there. You don't need to on us to match to, you know, of the what we call fixed infrastructure to do what we need to do with two lines, right?

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 and going with it.

Joel Jackson: 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. So he 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.

<unk>.

Speaker Change #130: 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 #130: 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 answer is to match two of the what we call 60 for structure too to.

Speaker Change #130: Do what we need to do with two lines right.

Joel Jackson: Okay, so the next question that's published here. Thanks for the answer. You also, it's really great. The car's hard, I think you absolutely hit them, you know, mid 24, as you said, you would earlier this year, it's such great. Now, you also had an SGNA target, you know, that you want to hit. 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 or haven't can you talk about, you know, what can you do to get the SGNA down more to what you want to get to.

Ana Cabral: So, as Matt was saying, scale it up, friend, what we're doing, and you raise an excellent point 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. And we earned 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.

Speaker Change #130: So it matches the same scale as our brand 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 racing. It so we're going to raise versus space. So sorry, we went from race.

Matthew DeYoe: We have taken steps to harmonize our even-done margins to balance out this volatility. What you're seeing on the left is an allocation of even-done margins for our business, assuming boats settled accurately without these provisional adjustments.

Speaker Change #130: 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 #130: 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.

Joel Jackson: Joel, take this one, right, and part of this is it's hard 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 platforms to double capacity and to triple capacity, right, was we talk about things like internalizing our commercial capabilities.

Speaker Change #130: What does that mean?

Speaker Change #130: It means you're going to need about eight sigmas, right?

Speaker Change #130: And the cheap reduction in scale, while the boom market was happening and we did that a year ago.

Speaker Change #130: Eight sigmas to reach these numbers, which is a pretty sizable number.

Speaker Change #130: 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 the market is growing.

Speaker Change #130: 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 #130: All of you remember the first time Roskill put out the 1 million ton LCE demand for 2025 in 2019.

Speaker Change #130: And that was the biggest bouquet of the whole industry.

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

Speaker Change #130: 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.

Speaker Change #130: Short circuiting.

Speaker Change #130: Steps on construction just to get their own time.

Joel Jackson: And I mean issues 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. But look, scale is our friend at sigma and SGNA is a key area where we will be able to scale.

Speaker Change #130: 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.

Ana Cabral: Now, very, very different environment. So it's interesting, because the environment now reminds you of the environment that we had when we were doing the details engineering for phase one, which was securing 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 done, 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 times.

Speaker Change #130: Well, now that's our reality.

Speaker Change #130: 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.

Joel Jackson: We do not need to double our SGNA to double our production capacity. So what 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 per ton basis will not get fully cut and Apple 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 #130: 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 we call. It 12 to 15 months comfortable and we already started project execution timeline, meaning.

Speaker Change #130: We're not using the acceleration budget.

Speaker Change #130: Whatsoever, so we're going to receive equipment into regularly times, we're going just to follow that.

Joel Jackson: Anna, and thank you for that. Anna, I just bought 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 sponsoring markets right now and the listed 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 not an SGNA.

Unknown Executive: 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 quite well on that.

Speaker Change #130: Our regular trajectory of this schedule so it's the paste.

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

Speaker Change #131: Construction timetable versus the res construction timetable because that is what allows us to actually manage.

Matthew DeYoe: We expect these headlines should subside, and ultimately revert as we come back from market route.

Speaker Change #131: The construction process in line with our own liquidity capabilities, and so far we're doing quite well on that.

Joel Jackson: Well, no, it's just 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? Because we're sitting to the right of green bushes on top of Bill Byrne in 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.

Matthew DeYoe: On the right side of the slide, you had seen our FOB margins, which is the said balance out against peers with sigma happily finding its way towards the upper end of echelon costs.

Speaker Change #131: Okay.

Andre Groupnick: And again, for any questions, press star one, and your next question comes from the line of Andre Groupnick with Straightwood. Please go ahead. 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 large. So when do you expect the capital intensity phase, phase two expansion to begin, and also do you still keep on intending funding this? We sort of more sure the term trade finance line. So, is there a plan to add more data? Oh, no, thank you for the questions.

Speaker Change #132: In fact, it's our bear case.

Speaker Change #132: And again for any questions Press Star one and your next question comes from the line of Andre Group, Nick with strike what please go ahead.

Matthew DeYoe: This is predicated on the hard work that I will discuss here.

Matthew DeYoe: I'm quite pleased to be presenting the cost line to you this morning.

Speaker Change #132: 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.

Hi, just a follow up on what 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 pace.

Speaker Change #132: 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 it's been encouraging is the flywheel effect of lower prices, stimulating demand in other markets.

Speaker Change #132: 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.

Matthew DeYoe: 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 ton, FOB of 420, and Plankgate costs of $370. The numbers in front of you for 2Q represent a reduction of 22 percent to 24 percent from our 4Q reported levels, which is where we were when we issued this guidance.

Speaker Change #132: Economics, Turing Economics.

Speaker Change #132: As it relates to what we see on more of a micro level, as Ana had mentioned early on, 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 #132: But what we have also is a seasonality that's increasingly present in the market.

Speaker Change #132: What you see on the top of the slide here represents Chinese production growth of lithium, The growth primarily, as we've discussed over time, occurs in the summer, and Ed's in the winter.

Speaker Change #132: It's not to say that Chinese production growth is not growing year over year, it is.

Speaker Change #132: And we see that and that's obvious in all the data points.

Speaker Change #132: 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.

Speaker Change #132: 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.

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

Joel Jackson: I mean, as we have these opportunities to drive further up our production yields, the costs are going to go down just as a result of, you know, larger volumes being sold. But when you go back to the project, to face two project 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, you know, one questionable that we have to go ahead with it.

Speaker Change #133: 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.

Speaker Change #133: If you look at the various colors, each color is the volume sold in any particular year.

Speaker Change #133: Phase two expansion to begin.

Speaker Change #133: 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 consumer 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.

Speaker Change #134: And also do you still keep on attending funding this with sort of more short term trade finance lines. So is there a plan to add more.

Speaker Change #133: Right.

Speaker Change #135: Now, what does that mean for our industry?

Speaker Change #135: Oh no. Thank you for the question, it's a very good question.

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

Speaker Change #135: 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.

Ana Cabral: It is a very good question. The cap typically in the enough in these construction, the context really picks up at the very end. And you can see by the, by the previous, the previous project, right? You have a bulk at the beginning, which relates to the positive 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 quintuple zero. You need, you know, and you need levels of sustainability actually.

Speaker Change #136: Typically in the <unk> in these constructions that capex really picks up at the very end and you can see by the by.

Matthew DeYoe: 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 #136: By the previous the previous project right you have a bulk at the beginning which relates to.

Matthew DeYoe: We will continue to work through this cost and productivity initiative to drive home with that cost structure, and this drives us to get back to exactly what I'm talking about as it relates to building operational culture of excellence.

Joel Jackson: I mean, just recapping this life, there's absolutely nothing out there that's as efficient as throwing a second line and going with it. 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 the pretty obvious one, it becomes then a complete no brainer, which we don't add to our analysis, but there it will all know it's there. You don't need to on us to match to, you know, of the what we call fixed infrastructure to do what we need to do with two lines, right?

Speaker Change #136: Deposits or prepayments of long lead items earthworks.

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 Earth works phase four four that engineering.

Matthew DeYoe: This is not our data, it's suspension marks, but I think it's a nice representation of where we think we've set and where we are delivered.

Speaker Change #136: And then youre depositing towards equipment in our case, we've got a break for our <unk> zero.

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

Speaker Change #136: You need.

Speaker Change #137: And unique levels of sustainability actually most global manufacturing equipments ones, who work with us. So what does that mean, we did we know well and obviously now we have credits we are a company that has revenues and delivered cash flow. So the credit worthiness.

Ana Cabral: Most global manufacturing equipment wants to work with us. So what does that mean? We just, we know well, and obviously now we have credit. We are, we are company that has revenues and deliver cash flow. So the credit work 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, not to prepay for lonely items, which is something we had 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 lines.

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

Joel Jackson: So as Matt was saying, scale it up, friend, what we're doing doing, and you raise an excellent point 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.

Matthew DeYoe: An internalizing our commercial efforts and keeping a focus on productivity is not only helped us generate revenue and cocks, but it's also helped right size our SGNA structure, which you see on the right side.

Our.

Speaker Change #137: 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 the board to prepay for long lead items, which is something we have to do in phase one some of.

Joel Jackson: And we earned 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. Now we measured no efforts to do it. We pulled out what we call an acceleration plan for phase one that cost us $20 million extra, where we were flying equipment, short circuiting steps on construction just to get there on time.

Speaker Change #137: 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 item Bill for Phase one was around 15, one 5 million U S dollars and we think the long lead item Bill here.

Ana Cabral: So we're saving some money there. So the lonely item bill for phase one was around $151,000,000 US dollars. 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, probably throughout. 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 the equipment starts getting delivered. And then you have to fully pay for the equipment.

Speaker Change #137: 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.

Joel Jackson: And we turned the plot 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 of the environment that we had when we were doing the details engineering for phase one, which was securing COVID, not the best part of COVID, the earlier 2020, which is a very challenging environment.

Speaker Change #137: If you look at a product 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 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.

Matthew DeYoe: Notably, SGNA is down with an additional roughly 24% from the second half of 23 levels.

Matthew DeYoe: And as this productivity plays out, we see further proof of competitive cost position.

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 too. And you can also see 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 pace, 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 space. We know Russia is so cheaply, you know, let's just put it that way.

Joe: Shoe 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.

Matthew DeYoe: And as we've said, again, on the prior slide, as it relates to the cost curve as provide a benchmark.

Joel Jackson: So we went back to the drawing board to the project execution plan timeline that we had done, 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 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 quite well on that.

Joe: Going to need to trigger it because we're just basing it.

Matthew DeYoe: So what does this all kind of mean?

Joe: We're no rush to sell cheaply.

Joe: That way.

Ana Cabral: 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 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, BNDES. BNDS 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 a putting perspective, Sigma just created an entire territory in the poorest region of the country.

Joe: So the second part.

Speaker Change #139: 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 #140: Oh, no 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 Mds is embarked in a very successful.

Speaker Change #141: New industrialization driving Brazil, we are part of that is centered on green industry Green producers on generation of industrial job 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.

Ana Cabral: And again, for any questions, press star one and your next question comes from the line of Andre Groupnick with Straightwood. Please go ahead. 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 large. So when do you expect the capital intensity phase, phase two expansion to begin, and also do you still keep on intending funding this?

Ana Cabral: We have about 13,000 direct and indirect jobs there; 1,500 direct jobs. So we are top of the line on the new industrialization development plan of Brazil. And we're bound to, we applied for a $100 million, $100 million dollar credit line with the 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, the nine because the development bank credit, so it is longer than 15 years. So it's a spread out duration; rates also are very favorable.

Matthew DeYoe: It helps drive what 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 of $33 million, which again represents a reduction of nearly 12.5 million from our 3Q23 levels.

Speaker Change #141: 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 dollars.

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 14.5 million dollars. And the second was the delay in receivables associated with two of our shipments. As for the pro-formal bridge, you can see that we've since received both payments shortly after quarter close.

Ana Cabral: We sort of more sure the term trade finance line. So is there a plan to add more data? Oh, no, thank you for the questions. It is a very good question. The cap typically in the enough in these construction, the context really picks up at the very end. And you can see by the, by the previous, the previous project, right? You have a bulk at the beginning, which relates to the positive or prepayments of lonely items.

Speaker Change #141: 100 million U S dollar credit line would be Mds.

Speaker Change #141: Which is going incredibly well because we sit within that.

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

Speaker Change #141: Framework of industrial policy, so that will be the primary source of funding debt duration is it.

Ana Cabral: With that, I'm going to pass it back to Anna and we'll talk through a bit.

Speaker Change #141: Exceptionally.

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 that engineering, and then you're depositing towards equipment. In our case, we've got a break for our quintuple zero. You need, you know, and you need levels of sustainability actually. Most global manufacturing equipment wants to work with us. So what does that mean? We just, we know well, and obviously now we have credit.

Speaker Change #141: Benign because its development bank credit 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.

Ana Cabral: Today, that line would have rates of about 8% in 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. So this debt 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 debt, where we're planning to replace that debt, even though it's been nine mature in 2026.

Speaker Change #142: 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 #142: By our shareholders when we were still pre operational rates.

Speaker Change #142: 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.

Ana Cabral: We liquidity position of the company. Yeah, so again, just to wrap up the financial section, I mean, we have a very comfortable liquidity position.

Ana Cabral: We are, we are company that has revenues and deliver cash flow. So the credit work 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, not to prepay for lonely items, which is something we had 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 lines.

Ana Cabral: 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.

Ana Cabral: And you know, it was given to us by our 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 commercial bank debt for, amongst other things, conduct liability management on the shareholder debt.

Speaker Change #142: Given to us by our shareholder were planned to replace that that with our commercial banking that as well. So we're very active in the debt markets as we speak at the moment development bank that.

Ana Cabral: So we're saving some money there. So the lonely item bill for phase one was around $151,000,000 US dollars. 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, probably throughout, if you look at the project execution plan, as I see here, throughout third quarter, fourth quarter.

<unk> duration of over 15 years for the actual cornerstone centerpiece of building the plant.

And our commercial bank that up for amongst other things conduct a liability management on the shareholder that.

Unknown Executive: That will conclude our Q&A session.

Speaker Change #143: And that will conclude our Q&A session I'll hand, the call back over to Matt.

Speaker Change #143: The fall stocking cycle is the classic stocking cycle in all methods.

Speaker Change #143: That's why LME happens in the midst of it historically.

Matthew DeYoe: I'll hand the call back over to Matt. Thank you, Regina.

Speaker Change #143: 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.

Speaker Change #144: 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.

Speaker Change #144: Batteries are consolidated, but the rest of the supply chain just isn't.

Speaker Change #144: 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 I mean, we want to close with is the best is yet to come and you can see we've been joined by a very prominent.

Speaker Change #144: It's just a small balance sheet set of participants.

Matthew DeYoe: 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 #144: 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.

Speaker Change #144: I think clearly, I mean, Sigma did not benefit from any of this execution in its valuations.

Speaker Change #144: I mean, we're still trading like a pre operational developer company.

Speaker Change #144: 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. 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.

Ana Cabral: I mean, what we want to close with is the best yet to come, and you can see we've been joined are very prominent neighbors.

Speaker Change #144: It's seen so much change, and it's seen so much lithium price volatility.

Speaker Change #144: None of this we control.

Speaker Change #144: But what we do control, our operational performance.

Speaker Change #144: 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.

Speaker Change #144: And we also want to take the occasion to welcome Pilbara to our neighborhood.

Speaker Change #144: And when measured against Pilbara, you can clearly see that we remain significantly undervalued.

Speaker Change #145: And we want to commend Pilbara for taking advantage of that and joining our neighborhood, acquiring lithium resources.

Ana Cabral: We're just going to have the bigger numbers hitting us on the first quarter as the equipment starts getting delivered. 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 too. And you can also see Joe's point. You see the construction acceleration plan. That was the rage portion of it, which we eliminated 20 million bucks.

Speaker Change #145: We're very proud, very proud of you joining our emerging lithium valley territory.

Speaker Change #145: 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 tremendously over the next couple of years.

Ana Cabral: 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 #145: And we want to, you know, welcome to Brazil, essentially.

Speaker Change #145: And the next slide basically shows our transformation, right?

Speaker Change #145: We have become, we've gone from a construction site, that's what we were back in January 2023, to an industry.

Speaker Change #145: So we delivered on every single operational aspect that we had set ourselves to deliver to our shareholders. 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.

Speaker Change #145: Just now this quarter, we initiated phase two earthworks construction.

Speaker Change #145: We now also hit our annual cost guidance ahead of schedule, way ahead of schedule.

Speaker Change #145: So we're printing the costs in our financial statements that we guided earlier in the year.

Speaker Change #145: 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 #145: So again, we want to thank you for the trust.

Speaker Change #145: We want to thank you for believing in us.

Speaker Change #145: 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.

Speaker Change #145: And we are committed to continuing to deliver to all of the shareholders throughout, you know, the next quarters ahead of us.

Speaker Change #145: So I want to close this up, just moving to the Q&A.

Speaker Change #145: Yeah, so Regina, I'm happy to move to Q&A.

Speaker Change #145: 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.

Speaker Change #145: Please go ahead.

Speaker Change #146: Yeah, thank you.

Speaker Change #146: Good morning.

Unknown Executive: That will conclude today's call; you may now disconnect.

Speaker Change #146: That will conclude today's call you may now disconnect.

Speaker Change #146: 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?

Speaker Change #146: That will conclude our Q&A session.

Speaker Change #146: But much more importantly, I am curious if you're seeing any sign of price inflection, or do you see it stabilizing down there?

Speaker Change #146: I'll hand the call back over to Matt.

Speaker Change #146: Any signs that things could tighten?

Speaker Change #146: Thank you, Regina.

Speaker Change #146: And, you know, I appreciate your comments about.., you know, the world's going to need.

Speaker Change #146: And with that, we're going to close the call.

Speaker Change #146: Six Sigmas for next year, you know, just given demand growth, but there is a lot of excess inventory in China.

Speaker Change #146: I appreciate everybody's time this morning and tuning in and we will see you on the conference circuit.

Speaker Change #146: Do you have a view that if the industry doesn't?

Speaker Change #146: Thank you.

Speaker Change #146: Unknown Speaker Do you have a view on when this inflection might occur if you're not seeing it yet?

Speaker Change #146: Thank you for the trust.

Speaker Change #146: Is it just seasonality that will drive that?

Speaker Change #146: Thank you for speaking with us.

Speaker Change #146: I welcome your thoughts.

Speaker Change #146: I mean, what we what we want to close with is the best is yet to come.

Ana Cabral: 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 going to need to trigger it because we're just space. We know Russia is so cheaply, you know, let's just put it that way. 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 plan? Oh no, sorry, I didn't answer that.

Speaker Change #146: 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-leased the other day.

Speaker Change #146: And you can see we've been joined by a very prominent neighbor.

Speaker Change #146: It's a single data point in time, not meant to be the average realized price for that.

Speaker Change #146: So it's now just me saying that Brazil is really one of the most fantastic jurisdictions for industrial lithium production in the world.

Speaker Change #146: I think your point, and I'll let Ana talk broadly about science in the market, but I mean...

Speaker Change #146: And we're hoping that all of you, our shareholders, will continue to benefit from that tremendously over the next couple of years.

Speaker Change #146: 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 #146: That will conclude today's call.

Speaker Change #146: That will conclude today's call you may now disconnect.

Speaker Change #146: 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.

Speaker Change #146: You may now disconnect.

Speaker Change #146: We know that a number of players out there are a bit upside down, and I'll pass it to them.

Speaker Change #146: Yeah, it goes back to traceability.

Speaker Change #146: This chart kind of says 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 #146: And traceable really means a very low bar of human rights adherence, no child labor.

Speaker Change #146: We're not talking zero carbon here, right?

Speaker Change #146: 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 #146: But there are players, they're selling into this gap, because they seem to have the cost structure to withstand it.

Speaker Change #146: 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 #146: 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.

Speaker Change #146: 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 #146: But our personal view is that these traceability standards are going to continue to be highly enforced, especially by industry players.

Speaker Change #146: 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.

Speaker Change #146: 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.

Ana Cabral: In other words, robust access to exporting credit. So robust liquidity.

Speaker Change #146: What fraction of global supply, Ana, would you say is untraceable?

Speaker Change #146: And does that happen to be higher on the cost curve?

Speaker Change #146: No, that's the whole point.

Speaker Change #146: The untraceable material in this current environment is coming from low cost producers.

Speaker Change #146: 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.

Speaker Change #146: If you look at production inflows, there's been a whole stigma coming out of a single African country just now.

Speaker Change #146: So clearly there isn't an industrial facility of the standards that we have delivered in that one country.

Speaker Change #146: So it's artisanal production of lithium.

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

Speaker Change #146: Again, lithium is not rare.

Speaker Change #146: So because lithium is everywhere, I think it puts an extra burden on automakers to enforce traceability and enforce sustainability.

Speaker Change #146: 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 egg.

Ana Cabral: 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 export link.

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 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 a putting 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 #146: This consumer is kind of turning, 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.

Speaker Change #146: 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.

Speaker Change #146: Thank you.

Speaker Change #146: 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?

Speaker Change #146: Or was this just from your from your engineers figuring out a way to recover that?

Speaker Change #146: Does it have a any impact on what you would view as your as your production capacity because of this?

Speaker Change #146: It does, because ultimately, I mean, it's not anything, let's say, exceptional that we've done.

Speaker Change #146: What we've done is the following.

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

Speaker Change #146: 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. So that's a constraint.

Speaker Change #146: So even if I lower my lithium oxide grade, I'm still constrained by that capacity.

Speaker Change #146: I can only flow that tonnage of product per hour. So this is a characteristic of my industrial plant, the Green Tech Plant.

Speaker Change #146: Now, what have we learned?

Speaker Change #146: We learned that the higher the quality of the pre-feed into that centrifugator, into the dense media separator, the higher our recovery.

Speaker Change #146: 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 #146: It can only be increased with an expansion so that I increase recovery.

Ana Cabral: And again, that's a sharp contrast to 1515% that we were granted in our very first straight line in January 2024.

Speaker Change #146: 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.

Ana Cabral: This very first straight line is being retired long, long ago, but it just shows the quick evolution of our robust credit worth.

Speaker Change #146: And we've already gotten there.

Speaker Change #146: 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.

Speaker Change #146: 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 #146: Thanks, Steve.

Speaker Change #146: We'll go to the next.

Ana Cabral: And this as we continue to demonstrate sales cadence and cost, of life.

Speaker Change #146: Our next question will come from the line of Joel Jackson with BMO.

Speaker Change #146: Please go ahead.

Speaker Change #146: Morimer Allah, and Victoria College here at these two.

Speaker Change #146: 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 affidavit is for phase two.

Speaker Change #146: If you don't get some sort of agreement there.

Speaker Change #146: Can you proceed on phase two?

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.

Speaker Change #146: Would you have to move phase two to a different part of the resource?

Speaker Change #146: 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?

Speaker Change #146: Joel, I think there's a massive confusion on your end here regarding land disputes.

Speaker Change #146: The only thing that's actually in there is essentially an ore 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.

Speaker Change #146: So Phase II is to the left of that ore body and is absolutely not connected to it.

Speaker Change #146: So we can go about our business irrespectively of what happened there.

Speaker Change #146: Now, what's the most important thing is that that area is actually controlled by me.

Ana Cabral: 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.

Ana Cabral: So we are top of the line on the new industrialization development plan of Brazil. And we're bound to, we applied for a $100 million, $100 million dollar credit line with the 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, the nine because the development bank credit, so it is longer than 15 years.

Speaker Change #146: So I have 51% of that area is a Brazilian corporation.

Speaker Change #146: So even if that were to become an issue, I would obviously resolve it favorably to Sigma.

Speaker Change #146: So it's a non-issue.

Speaker Change #146: So going back to it, essentially, what we are what we are doing is just proceeding with our planned business as usual.

Speaker Change #146: I mean, we got Barrero, which is phase two, giant oil body, which can be accessed by all sides.

Ana Cabral: And this is actually measurable.

Speaker Change #146: The mining concession belongs to Sigma.

Speaker Change #146: The overground belongs to a company that's affiliated to Sigma.

Speaker Change #146: So, you know, it's business as usual, proceeding business as usual.

Speaker Change #146: You might be referring to the noise my, let's say, former husband tried to make to create that sort of misunderstanding, 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.

Speaker Change #146: That noise has nothing to do with Sigma.

Speaker Change #146: In fact, I have great news for everyone in attendance.

Speaker Change #146: My divorce has been declared quite a while ago, and as you can all see, I'm still here, Sigma's still here.

Speaker Change #146: 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.

Speaker Change #146: So it was just, as Shakespeare says, much ado about nothing.

Speaker Change #146: But it's understandable in a divorce when one of the parties is less wealthy than the other one.

Speaker Change #146: Okay, so my next question at this publication here.

Speaker Change #146: Thanks for the answer.

Speaker Change #146: This is really great on the car targets.

Speaker Change #146: I think you absolutely hit them, you know, mid 24, as you said you would earlier this year.

Speaker Change #146: So that's great.

Speaker Change #146: Now you also had an SG&A target, you know, that you want to hit.

Speaker Change #146: And obviously, you know, when you have a downturn in pricing, you want to get lean and tight.

Ana Cabral: And this is why you love these industries because they removed the opinion out of the conversation.

Speaker Change #146: It seems like the SG&A is still staying up there.

Speaker Change #146: And there's also legal costs you're having.

Speaker Change #146: Can you talk about, you know, what can you do to get the SG&A down more to what you want to get to?

Ana Cabral: Mathematics is just a data, a number, doesn't carry a new opinion.

Speaker Change #146: Joel, I'll take this one right 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.

Speaker Change #146: But obviously, we have intention to grow.

Speaker Change #146: 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 #146: When we talk about things like internalizing our commercial capabilities, and I mean, let's just use that as an example, right?

Speaker Change #146: We've had to build out the commercial team.

Speaker Change #146: 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.

Speaker Change #146: But look, scale is our friend at Sigma and SG&A is a key area where we will be able to scale.

Speaker Change #146: We do not need to double our SG&A to double our production capacity.

Speaker Change #146: 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 #146: 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.

Speaker Change #146: And that's part of the leverage in the operating model that we really are looking forward, Ana, and thank you for that, Matt.

Speaker Change #146: Ana, can I just follow up on that one more and I'll pass the baton.

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 concentrates all around the world.

Ana Cabral: 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. 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.

Speaker Change #146: So I understand wanting to not give up on the growth.

Speaker Change #146: Obviously, we all know what's happening with spodumene markets right now and the lithium markets right now.

Speaker Change #146: What, Ana, would you have to see?

Speaker Change #146: 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, cut costs where you can and hold on to phase one, or phase two is happening no matter what, no matter the price?

Ana Cabral: 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 #146: Well, no, this is just happening no matter what.

Speaker Change #146: I think this slide that you see here illustrates that well.

Speaker Change #146: In other words, if Sigma cannot operate profitably, I think the whole industry is doomed, right?

Speaker Change #146: Because we're sitting to the right of green bushes on top of Bilbao in terms of our low cost.

Speaker Change #146: So there's not a whole lot more that we can do.

Speaker Change #146: 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.

Speaker Change #146: But when you go back to the phase two project 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, you know, unquestionable that we have to go ahead with it.

Speaker Change #146: I mean, just recapping this slide, there's absolutely nothing out there that's as efficient as throwing a second line and going with it.

Speaker Change #146: 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.

Ana Cabral: 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 #146: You don't need two ANAs, two MATs, two, you know, of the, what we call, fixed infrastructure to do what we need to do with two lines, right?

Speaker Change #146: So, as Matthew was saying, scale is our friend.

Speaker Change #146: What we're doing, though, and you raise an excellent point, Joel, on this, we're pacing it.

Ana Cabral: The smaller the bubble and again the lower the quadrant, the better the project is.

Speaker Change #146: In other words, when we did the first project, and you remember that very well, we were racing it.

Speaker Change #146: So we're going to race versus space.

Speaker Change #146: 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 hit and achieve production in scale while that bull market was happening.

Speaker Change #146: And we did that a year ago.

Speaker Change #146: Now, we measured no efforts to do it. 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.

Speaker Change #146: And we turned the plant on in May, April, May 23.

Speaker Change #146: And by July, we had our first shipment out of the door.

Speaker Change #146: That was phase one, now very, very different environment.

Speaker Change #146: So it's interesting because the environment now reminds you 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.

Ana Cabral: So we're kind of sitting in a leo wrong in terms of capital efficiency here.

Speaker Change #146: So we went back to the drawing board, to the project execution plan timeline that we had then, 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 their regular lead times. We're going just to follow the regular trajectory of the schedule.

Speaker Change #146: So it's the pace, construction timetable versus the raced construction timetable.

Speaker Change #146: Because that is what allows us to actually manage, the construction process in line with our own liquidity capabilities.

Speaker Change #146: And so far we're doing you know quite well on that.

Speaker Change #146: And again, for any questions, press star one and your next question comes from the line of Andre Krupnik with Drakewood.

Speaker Change #146: Please go ahead.

Speaker Change #146: Hi Ana, just a follow up on what you were just discussing with Joel.

Speaker Change #146: So looking at your financials for the second quarter, your capital spent was quite light.

Speaker Change #146: So when do you expect the capital intent to face?

Speaker Change #146: face to expansion to begin.

Speaker Change #146: And also, do you still keep on intending of funding this with some more shorter term trade finance lines?

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

Ana Cabral: So this debt 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 debt, where we're planning to replace that debt, even though it's been nine mature in 2026. And you know, it was given to us by our 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 commercial bank debt for amongst other things conduct liability management on the shareholder debt.

Speaker Change #146: Or is there a plan to add more debt?

Speaker Change #146: Oh, no, thank you for the question.

Speaker Change #146: And it's a very good question.

Speaker Change #146: Typically, in these constructions, the capex really picks up at the very end.

Ana Cabral: And I'll skip two slides and then I'll go back one second.

Speaker Change #146: And you can see by the previous project, right?

Speaker Change #146: You have a bulk at the beginning, which relates to deposits or prepayments of long-lived items.

Speaker Change #146: Earthworks is quite inexpensive.

Speaker Change #146: The total earthworks cost is $8.9 to $9 million.

Speaker Change #146: And that's basically it.

Speaker Change #146: And so you're basically paying for earthworks, paying for that engineering, and then you're depositing towards equipment.

Speaker Change #146: In our case, we've got a break for our quintuple zero, unique levels of sustainability excellence.

Speaker Change #146: Most global manufacturing equipments want to work with us.

Speaker Change #146: So what does that mean?

Speaker Change #146: Well, and obviously now we have credit.

Speaker Change #146: We are a company that has revenues and delivers cash flow.

Speaker Change #146: 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.

Speaker Change #146: So we're no longer required to prepay 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 line.

Speaker Change #146: So we're saving some money there.

Speaker Change #146: So the long lead item bill for phase one was around 15, 1.5 million US dollars.

Speaker Change #146: And we think the long lead item bill here is somewhat expanded, but it will be a bit smaller than that.

Speaker Change #146: So as you can see, long lead items and earthworks are the two main elements of cost of this project.

Speaker Change #146: Probably throughout, 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 #146: 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 too.

Speaker Change #146: And you can also see Joel's point.

Speaker Change #146: You see the construction acceleration plan, that was the race portion of it, which we eliminated.

Speaker Change #146: It's 20 million bucks.

Speaker Change #146: So this time is the pace, meaning we don't have that acceleration plan in place.

Speaker Change #146: It's there, it's quoted, but we're not going to need to trigger it because we're just pacing.

Speaker Change #146: We know Russia sells cheap lithium, let's just put it that way.

Speaker Change #146: 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?

Speaker Change #146: Oh, no, sorry, I didn't answer that.

Speaker Change #146: We are in ongoing discussions with, well, we announced it, actually.

Speaker Change #146: We are in ongoing discussions with Brazil's development bank, BNDS.

Speaker Change #146: BNDS is embarked on a very successful new industrialization drive in Brazil.

Speaker Change #146: We are part of that.

Speaker Change #146: It's centered on green industry, green producers, on generation of industrial jobs.

Speaker Change #146: 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 #146: 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.

Speaker Change #146: So that will be the primary source of funding.

Speaker Change #146: The duration is exceptionally, you know, benign because it's development bank credit.

Speaker Change #146: So it is longer than 15 years.

Speaker Change #146: So it's a spread out duration.

Speaker Change #146: Rates also are very favorable.

Speaker Change #146: Today, that line would have rates of about 8% in local currency, which are even lower than our current dollar denominated rates.

Speaker Change #146: So that will be our primary source of phase two funding.

Speaker Change #146: 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?

Unknown Executive: That will conclude our Q&A session.

Matthew DeYoe: I'll hand the call back over to Matt. Thank you, Regina.

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. I mean, what we want to close with is the best yet to come and you can see we've been joined are very prominent neighbors. 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.

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

Ana Cabral: You have one square kilometer of industrial facilities here.

Ana Cabral: So when you see the layout, you can see that you have in green the existing insights inside the gate or the capital 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.

Ana Cabral: So benefiting from this existing capital infrastructure with 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.

Ana Cabral: 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.

Ana Cabral: 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 generation.

Ana Cabral: The next phase It's 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 Matthew.

Matthew DeYoe: I'll comment on this slide and then Matthew comment on a few other slides.

Unknown Executive: That will conclude today's call, you may now disconnect.

Matthew DeYoe: So share the section with my partner here.

Matthew DeYoe: 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.

Matthew DeYoe: China has delivered almost 4% growth in the year in electric vehicles always like BVs, BVs sales and China's bounds to reach 60% of the global EV market by the end of the year.

Matthew DeYoe: Overdating 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.

Matthew DeYoe: 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.

Matthew DeYoe: No one has taught that in 2024, just five years later, twice a year already, EV sales, surpass sales of combustion cars, three or four times during this year already, represented over 50% of overall car sold in China.

Matthew DeYoe: It's a remarkable achievement.

Matthew DeYoe: And at that, I'll encourage you to look at this slide on the left.

Matthew DeYoe: 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 LC equivalent by the end of 2024.

Matthew DeYoe: If China continues just on the face it is, we're going to need 1.4 million tons of LC equivalent just by next year.

Matthew DeYoe: What does that mean?

Matthew DeYoe: It means you're going to need about 8 segments, right?

Matthew DeYoe: 8 segments to reach these numbers, which is a pretty sizable number.

Matthew DeYoe: In other words, the market is growing annually.

Matthew DeYoe: Now what is equivalent to the entire size of the whole market just five years ago, meaning the whole market was 200,000 tons of LC in 2019.

Matthew DeYoe: And that is the volume that is added to the market in the bear case that prevailed today, just basically having only China as a locomotive, 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.

Matthew DeYoe: All of you remember the first time rock you put out the 1 million ton LC demand for 2025 in 2019 and there was the biggest bouquet of the whole industry.

Matthew DeYoe: Well, now that's our reality.

Matthew DeYoe: In fact, it's our bear case.

Matthew DeYoe: Yeah, and to build on that a little bit is 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 prices 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 a megapack numbers over the last two key resolve kind of reflect the improved economics of energy storage project as prices for batteries fall and that's kind of economics cheering economics at the here as it relates to what we see on more of a micro level as then I had mentioned early on right we we don't control that the prices in the market is obviously working its way through a bit of overspie over the last 12 months but what we have also is a seasonality that's increasingly present in the market what do you see on the top of the market?

Matthew DeYoe: 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 sold in China if you look at the various colors each color is the volume so in any particular year.

Matthew DeYoe: Now what does that mean for our industry means the following the sheer volume of materials required to deliver this significant volume 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.

Matthew DeYoe: 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 or stocking period.

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.

Ana Cabral: I think clearly I mean, Sigma did not benefit from any of this execution in its valuations.

Ana Cabral: I mean, we're still trading like a pre-operational developer company.

Ana Cabral: 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. 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.

Ana Cabral: It seemed so much change and it seemed so much let you price volatility.

Ana Cabral: None of this we control.

Ana Cabral: But when we do control our operational performance.

Ana Cabral: 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 under value.

Ana Cabral: And we also want to take the occasion to welcome a billboard to our neighborhood.

Ana Cabral: And when measured against billboard, you can clearly see that we remain significantly under value.

Ana Cabral: And we want to command billboard from taking advantage of that and joining our neighborhood acquiring Latin resources.

Ana Cabral: We're very proud, very proud of you joining our emerging lithium valley territory.

Ana Cabral: And we want to, you know, welcome to Brazil, especially.

Ana Cabral: And the next slide basically shows our transformation, right?

Ana Cabral: We have, because we've gone from a construction site.

Ana Cabral: That's what we were back in January 2023 to an industry.

Ana Cabral: 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 three, which is the first and only dry stacking module in the entire industry, we have basically delivered on every metric.

Ana Cabral: Just now this quarter we initiated face to earthworks construction.

Ana Cabral: We now also hit our annual cost guidance.

Ana Cabral: I had a schedule away.

Ana Cabral: I had a schedule.

Ana Cabral: So we're printing the costs in our financial statements that we guided earlier in the year.

Ana Cabral: So I think the next step here, the next stop in our sequence of deliveries will be commissioning face to, which will happen, you know, a year from now.

Ana Cabral: So again, we want to thank you for the trust.

Ana Cabral: We want to thank you for believing in us.

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 off our country.

Ana Cabral: And we are committed to continuing to deliver to all of the shareholders throughout, you know, the next quarters ahead of us.

Ana Cabral: So I want to close this.

Unknown Executive: Just moving to the Q&A.

Unknown Executive: Yes, so Regina, happy to move to Q&A from here.

Steve Byrne: Yeah, thank you.

Steve Byrne: Good morning.

Steve Byrne: You're your slide nine that shows your monthly pricing year to date.

Steve Byrne: Is that nine fifty three you show in there?

Steve Byrne: Is that is that the the month to date average for August or is that is that July?

Steve Byrne: But much more importantly, I'm curious if you're seeing any signs of price inflection or do you do you see it stabilizing down there 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 per next year, you know, just given demand growth, but there is a lot of excess inventory in China.

Steve Byrne: 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 when this inflection might occur, if you're not seeing that, yeah, is it just seasonality that will drive that?

Steve Byrne: 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.

Ana Cabral: I think your point and I'll let Anna talk for all the about signs in 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 you know, that's not sustainable, 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 in some of the discussions we have on cost targets, particularly from traceable sources.

Ana Cabral: We know that a number of, a number of players out there are a bit upside down, and I don't have to.

Ana Cabral: Yeah, it goes back to traceability, this truck 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 like human rights adherence.

Ana Cabral: No trial 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're selling into this gap because they seem to have the cost structure to expand it and based on the data of product and flow from Africa mainly we're led to believe that this gap today with prices where they are has been mainly seen.

Ana Cabral: [inaudible] materials.

Ana Cabral: 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.

Ana Cabral: I mean, if the industry decides that it's acceptable to use materials that in fringe human rights and child labor rules and easy traceability rules to build green electric cars and sustainable electric cars.

Ana Cabral: 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.

Ana Cabral: But our personal view is that these traceability standards are going to continue to be hiding for, especially by industry players.

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 not supply chains into the leading supply chains in the world.

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 batteries supply chains altogether.

Ana Cabral: And what fraction of global supply and I would you say is untraceable and is that happened to be higher on the cost curve?

Ana Cabral: No, that's the whole point.

Ana Cabral: The untraceable material in this current environment is coming from low cost producers.

Ana Cabral: 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: If you look at production inflows, there's been a whole segment coming out of a single African country just now.

Ana Cabral: So clearly, there isn't an industrial facility of the standards that we have delivered in that one country.

Ana Cabral: So, it's artisanal production of lithium.

Ana Cabral: Again, lithium is not rare.

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, the lady, go to the met with these 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 or the materials that go in building those cars.

Ana Cabral: And we've been very vocal about that because this is the kind of behavior, the risks, the entire supply chain for all of us.

Ana Cabral: And you've seen what happened to cobalt before.

Ana Cabral: Thank you.

Steve Byrne: And if I can just squeeze one in, the technology that you, this technology that you you know, implemented to recover more lithium out of your, your, the finds is, 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, does it have any impact on what you view as you're as you're production capacity because of that.

Ana Cabral: It does, because ultimately, I mean, it's not anything, let's say, exceptional that we've done.

Ana Cabral: What we've done is the following.

Ana Cabral: The dense media separation method is one that's constrained by the capacity of the concentrated, the centrifugator, which in our case is 250 tons an hour, more at 100%, but the design capacity is 237 tons an hour, so that's a constraint.

Ana Cabral: So even if I lower my lithium off by grade, I'm still constrained by that capacity.

Ana Cabral: I can only flow that tonnage of product per hour. So this is a characteristic of my industrial plant, the green type plant.

Ana Cabral: Now, what have we learned?

Ana Cabral: 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 only be increased with an expansion, so that I can increase recovery. So I increase yield by even better material pre-purified pre-screened material.

Ana Cabral: I am able to achieve better results in the dense media separation.

Ana Cabral: That's what we're doing.

Ana Cabral: And we've already gotten there.

Ana Cabral: 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.

Steve Byrne: So that's kind of what the depuration of the feed that goes into those centrifugators do for our production throughput for our yield.

Unknown Executive: Thanks, Dave.

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

Joel Jackson: Our next question will come from the line of Joel Jackson with BMO.

Joel Jackson: Please go ahead.

Joel Jackson: Morning, man.

Joel Jackson: And I think it's all about your face, too.

Joel Jackson: So a bit of a technical question.

Joel Jackson: 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, too.

Joel Jackson: If you don't get some sort of agreement there, can you proceed on phase two, would you have to move phase two to different part of the resource?

Joel Jackson: 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?

Ana Cabral: Joel, I think there's a massive confusion on your end here regarding land disputes.

Ana Cabral: Well, we're the only thing that's actually in there.

Ana Cabral: It's essentially a norbody that doesn't have anything to do with phase two.

Ana Cabral: That sits between phase two and phase three.

Ana Cabral: That's independence of those two phases.

Ana Cabral: And that's nothing to do with sigma.

Ana Cabral: So phase two is to the laughter of that or body and is absolutely not connected to it.

Ana Cabral: So we can go about our business irrespectively of what happened there.

Ana Cabral: Now, what's the most important thing is that that area is actually controlled by me.

Ana Cabral: So I have 51 center that area is a Brazilian corporation.

Ana Cabral: So even is that word to become an issue, I would obviously resolve it favorably to sigma.

Ana Cabral: So it's a non-issue.

Ana Cabral: So going back to it essentially, what we are doing is just proceeding with our plan's business is usual.

Ana Cabral: I mean, we got bairro, which is phase two giant or body, which can be accessed by all The mining concession belongs to Sigma.

Ana Cabral: The overground belongs to a company that's affiliated to Sigma.

Ana Cabral: So, you know, it's business is usual for seeing business is usual.

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 an opportunity for me to clear it out for all of the participants in this conference.

Ana Cabral: That noise has nothing to do with Sigma.

Ana Cabral: In fact, I have great news for everyone in attendance.

Ana Cabral: My divorce has been declared quite a while ago.

Ana Cabral: 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 Cabral: So he 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.

Unknown Executive: Okay, so the next question that's published here.

Unknown Executive: Thanks for the answer.

Unknown Executive: You also, it's really great.

Matthew DeYoe: The car's hard, I think you absolutely hit them, you know, mid 24, as you said, you would earlier this year, it's such great.

Joel Jackson: Now, you also had an SGNA target, you know, that you want to hit.

Joel Jackson: And obviously, you know, when you have a downturn pricing, you want to get lean and tight.

Joel Jackson: As soon as the SGNA is still staying up there, and there's also legal costs or haven't can you talk about, you know, what can you do to get the SGNA down more to what you want to get to.

Matthew DeYoe: Joel, take this one, right, and part of this is it's hard 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.

Matthew DeYoe: And so what we've been building is a is a operationally and commercially sophisticated organization to give us the platforms to double capacity and to triple capacity, right, was we talk about things like internalizing our commercial capabilities.

Matthew DeYoe: And I mean issues 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.

Matthew DeYoe: But look, scale is our friend at sigma and SGNA is a key area where we will be able to scale.

Matthew DeYoe: We do not need to double our SGNA to double our production capacity.

Matthew DeYoe: So what 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.

Matthew DeYoe: But again, things like SGNA, you know, that that on a per ton basis will not get fully cut and Apple 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.

Matthew DeYoe: Anna, and thank you for that.

Joel Jackson: Anna, I just bought one more and I'll pass the baton.

Joel Jackson: So I understand wanting to not give up on the growth.

Joel Jackson: Obviously, we all know what's happening with sponsoring markets right now and the listed markets right now.

Ana Cabral: 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 not an SGNA.

Ana Cabral: Well, no, it's just happening no matter what.

Ana Cabral: I think this slide that you see here illustrates that well.

Ana Cabral: In other words, if Sigma cannot operate properly, I think the whole industry is doomed, right?

Ana Cabral: Because we're sitting to the right of green bushes on top of Bill Byrne in terms of our low cost.

Ana Cabral: So there's not a whole lot more that we can do.

Ana Cabral: We're going to continue to strive for lowering costs, but now focusing on unit cost reduction. I mean, as we have these opportunities to drive further up our production yields, the costs are going to go down just as a result of, you know, larger volumes being sold.

Ana Cabral: But when you go back to the project, to face two project per se, I mean, we got the liquidity to do it.

Ana Cabral: And when you look at the capital efficiency of that project, it's essentially, you know, one questionable that we have to go ahead with it.

Ana Cabral: I mean, just recapping this life, there's absolutely nothing out there that's as efficient as throwing a second line 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 the pretty obvious one, it becomes then a complete no brainer, which we don't add to our analysis, but there it will all know it's there.

Ana Cabral: You don't need to on us to match to, you know, of the what we call fixed infrastructure to do what we need to do with two lines, right?

Ana Cabral: So as Matt was saying, scale it up, friend, what we're doing doing, and you raise an excellent point on discipline.

Ana Cabral: We're pacing it.

Ana Cabral: In other words, when we did the first project, and you remember that very well, we were racing it.

Ana Cabral: So we're going to race versus space.

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.

Ana Cabral: And we earned 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: And we turned the plot on in May, April, May 23, and by July, we had our first shipment out of the door.

Ana Cabral: That was phase one.

Ana Cabral: Now, very, very different environment.

Ana Cabral: So it's interesting, because the environment now reminds you of the environment that we had when we were doing the details engineering for phase one, which was securing COVID, not the best part of COVID, the earlier 2020, which is a very challenging environment.

Ana Cabral: So we went back to the drawing board to the project execution plan timeline that we had done, 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 regularly times. We're going just to follow the regular trajectory of the schedule.

Ana Cabral: 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.

Ana Cabral: And so far we're doing quite well on that.

Unknown Executive: And again, for any questions, press star one and your next question comes from the line of Andre Groupnick with Straightwood.

Andre Groupnick: Please go ahead.

Andre Groupnick: Hi, Ana.

Andre Groupnick: Just a follow-up on what you were just discussing with Joel.

Andre Groupnick: So looking at your financials for the second quarter, your capital spent was quite large.

Andre Groupnick: So when do you expect the capital intensity phase, phase two expansion to begin, and also do you still keep on intending funding this?

Andre Groupnick: We sort of more sure the term trade finance line.

Andre Groupnick: So is there a plan to add more data?

Ana Cabral: Oh, no, thank you for the questions.

Ana Cabral: It is a very good question.

Ana Cabral: The cap typically in the enough in these construction, the context really picks up at the very end.

Ana Cabral: And you can see by the, by the previous, the previous project, right?

Ana Cabral: You have a bulk at the beginning, which relates to the positive or prepayments of lonely items.

Ana Cabral: Earthworks is quite inexpensive.

Ana Cabral: The total earthworks cost is $8.9 to $9 million.

Ana Cabral: And that's basically it.

Ana Cabral: And so you basically pay for earthworks, pay for that engineering, and then you're depositing towards equipment.

Ana Cabral: In our case, we've got a break for our quintuple zero.

Ana Cabral: You need, you know, and you need levels of sustainability actually.

Ana Cabral: Most global manufacturing equipment wants to work with us.

Ana Cabral: So what does that mean?

Ana Cabral: We just, we know well, and obviously now we have credit.

Ana Cabral: We are, we are company that has revenues and deliver cash flow.

Ana Cabral: So the credit work 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.

Ana Cabral: So we're no longer required to deposit, not to prepay for lonely items, which is something we had 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 lines.

Ana Cabral: So we're saving some money there.

Ana Cabral: So the lonely item bill for phase one was around $151,000,000 US dollars.

Ana Cabral: And we think the lonely item bill here is somewhat expanded, but you will be a bit smaller than that.

Ana Cabral: So as you can see, lonely 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.

Ana Cabral: We're just going to have the bigger numbers hitting us on the first quarter as the equipment starts getting delivered. And then you have to fully pay for the equipment.

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 too.

Ana Cabral: And you can also see Joe's point.

Ana Cabral: You see the construction acceleration plan.

Ana Cabral: That was the rage portion of it, which we eliminated 20 million bucks.

Ana Cabral: So this time is the pace, meaning we don't have that acceleration plan in place.

Ana Cabral: It's there.

Ana Cabral: It's quoted, but we're not going to need to trigger it because we're just space.

Ana Cabral: We know Russia is so cheaply, you know, let's just put it that way.

Ana Cabral: 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 plan?

Ana Cabral: Oh no, sorry, I didn't answer that.

Ana Cabral: We are in ongoing discussions with, well, we announced it actually.

Ana Cabral: We are in ongoing discussions with Brazil's development bank, BNDS.

Ana Cabral: BNDS is embarked in a very successful new industrialization driving Brazil.

Ana Cabral: We are part of that.

Ana Cabral: It's centered on green industry, green producers on generation of industrial jobs.

Ana Cabral: Just a putting 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.

Ana Cabral: So we are top of the line on the new industrialization development plan of Brazil.

Ana Cabral: And we're bound to, we applied for a $100 million, $100 million dollar credit line with the BNDS, which is going incredibly well because we sit within that, you know, framework of industrial policy.

Ana Cabral: So that will be the primary source of funding.

Ana Cabral: The duration is exceptionally, you know, the nine because the development bank credit, so it is longer than 15 years.

Ana Cabral: So it's a spread out duration rates also are very favorable.

Ana Cabral: Today that line would have rates of about 8% in local currency, which are even lower than our current dollar denominated rates.

Ana Cabral: So they'll be our primary source of face to funding.

Ana Cabral: 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.

Ana Cabral: 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. So this debt has restricted covenants.

Ana Cabral: He has a higher rate.

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 been nine mature in 2026.

Ana Cabral: And you know, it was given to us by our shareholder, we're planning to replace that debt with commercial banking debt as well.

Ana Cabral: So we're very active in the debt market as we speak at the moment.

Ana Cabral: Development bank debt, you know, duration of over 15 years for the actual, you know, cornerstone centerpiece of building the plant and commercial bank debt for amongst other things conduct liability management on the shareholder debt.

Unknown Executive: That will conclude our Q&A session.

Matthew DeYoe: I'll hand the call back over to Matt.

Matthew DeYoe: Thank you, Regina.

Matthew DeYoe: And with that, we're going to close the call.

Unknown Executive: 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.

Unknown Executive: Thank you.

Ana Cabral: Thank you for the trust.

Ana Cabral: Thank you for sticking with us.

Ana Cabral: I mean, what we want to close with is the best yet to come and you can see we've been joined are very prominent neighbors.

Ana Cabral: 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.

Unknown Executive: That will conclude today's call, you may now disconnect.

Q2 2024 Sigma Lithium Corp Earnings Call

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