Q2 2025 MP Materials Corp Earnings Call
Apple is 1 of the world's most sophisticated supply chain managers and 1 of the largest and most experienced users of rare earth. Magnets, making it, an ideal customer and a powerful validation of MPS capabilities.
Apple embodies everything. We hoped for in a flagship commercial, partner to follow GM.
They will be the foundational customer for our commercial Recycling business.
Anchored by the construction of a dedicated recycling circuit at Mountain Pass and the expansion of Independence.
This long-term contract will result in over 500 million dollars in contracted magnet, purchases beginning in 2027,
We expect the economics to reflect attractive Returns on our capital and significant commitments to this partnership.
Apple will also provide $200 million in milestone-based prepayments over the coming years, supporting the buildout of both the recycling circuit and Independence.
Importantly, Apple will leverage its Global Supply Chain to provide post-consumer and post-industrial magnet feed stock.
This significantly accelerates MP's entry into recycling at scale, with substantial, potential upside.
Recycled feed stock should reduce unit production costs. And over time, the ability to recover more material at Mountain Pass, could expand our production profile Beyond current targets.
I want to recognize the extraordinary efforts of our team whose execution over the past several years. Has earned us the right to enter into these transformative Partnerships.
I also want to acknowledge General Motors. Whose early commitment to our mission. Helped catalyze this moment.
Turning to operations.
Our materials and magnetic segments, continue to deliver strong execution.
This result was consistent with our expectations and more than double last year's output.
Our Upstream operations also delivered. The second highest quarterly Aro production in the history of mountain pass with record. Recoveries driven by ongoing optimization work.
In our magnetic segment. We expand both ndpr metal production and sales volumes which led to significant Revenue growth and EBA generation
at Independence, we are now consistently producing magnets that meet our customers demanding specifications for Ev traction, Motors a critical milestone,
The next step is transferring this capability from trial production to scaled production.
Commissioning at the factory is accelerating. Momentum is building as we progress toward commercial magnet production later this year.
Michael will provide a detailed operational update in a few minutes after Ryan covers our second quarter results, Ryan,
Thanks Jim turning the slide 5 and our Consolidated results second quarter Revenue, increased 84% compared to last year, driven by the ramp up and sales of magnet precursor products as well as the record production of ndpr oxide at Mountain Pass.
The sequential comparison was impacted by our strategic decision. To end sales of concentrate to external customers in the quarter.
With the new DOD agreement. I would point out that for the foreseeable future. We will no longer sell concentrate to third parties but stockpile any excess production until we further ramp. Ndpr oxide output from our Midstream assets.
Importantly, beginning in Q4, we will begin benefiting from the dod price floor agreement with first cash payments likely to be received in q1.
I would also add that we continue to work through all of the accounting, mechanics of the various features of the dod contract. For example, how the top up payments for stockpiled products will be recognized.
We will call out the major conclusions in our Q3 or Q4 call.
Moving to the middle of the slide, you'll see adjusted. Evita also improved year-over-year driven by the higher sales of magnet precursor products as well as continued improvements in per unit ndpr oxide production costs.
Including 8.3 million and lower reserves on work in process and finished good inventories at Mountain Pass.
Which at this point, is mainly related to early production of LM products.
Sequentially adjusted, I declined to primarily due to the lower sales of REO and concentrate.
And moving to the far right. Adjusted diluted EPS, improved. Compared to the second quarter of last year, mainly due to the improved adjusted. Evita partially offset by lower interest income and income tax benefits, as well as higher depreciation, depletion and amortization compared to last year.
6, and the material segment, kpis, and starting on the left with the Upstream. You can see the world-class performance by the mountain pass team as we produced 13,145 metric, tons of REO. In the quarter, 45% above last year or call last year. We had unplanned downtime that interrupted production for roughly 3 weeks.
This quarter's 13,000 plus metric. Tons was our second best quarterly Vol ever, which is even more impressive, given the 2 week plan maintenance shutdown. We took at the beginning of the quarter,
You can see the impact of our decision to Halt sales of concentrate in the middle left of the slide. With a realized pricing on the product. We did sell remaining in the mid-40s which included the impact of a 10% tariff applied during the quarter on our final Chinese sales.
Moving to the Midstream on the right side of the slide. We had a modest increase in sequential production of ndpr oxide approximately 6% to 597 metric tons in line with our discussion last quarter with material improvements in throughput offset and the reported metrics by the planned, downtime from our maintenance, turnaround, at the beginning of April,
importantly, we set a monthly record for production in May followed by another record in June
As we stated, we were generally at about the 50% mark of our targeted total throughput in May and June. Michael will provide more insights on our refining progress shortly, including his thoughts on targeted production for Q3.
In the middle, right? You can see ndpr sales volumes continue to be strong year-over-year up to 226%. Generally following the ramp in production,
Timing of shipments is always a factor in our results. Particularly as a significant amount of our production continues to go through southeast Asia to be told into metal before. Being sold to our end customers, these volumes remain in our balance sheet and are not recognized as Revenue, until passed along to the final customer.
We continue to expect sales volumes to follow production on roughly a 1 quarter lag with some amount of lumpiness, as seen this quarter as we continue to rapidly. Fill the tolling Channel with growing oxide production.
Moving to the far right of the slide. You can see that the market price for ndpr did experience solid lift both sequentially up about 10% in year-over-year up. Roughly 19% slightly better than our expectations in early May
Flipping to slide 7 and our segment financials.
On the left, you can see our material. Segment revenues increased nearly 20% year-over-year due to the strong. Ndpr sales volume growth combined with the improved pricing environment. The sequential decline was solely due to the reduced sales volumes of concentrate compared to q1.
Segment. Adjusted ibida. Also improved as mentioned earlier, due to the improving per unit costs of ndpr production, as well as the lower inventory reserves as well as last year's higher maintenance costs from the thickener repairs.
Sequential results, similar to revenues were driven by the decline in concentrate sales.
Moving to the right and our magnetic segment. The team at Independence, ramped production nicely. Thanks to completing the commissioning of our second electrolysis cell.
Though, not without the usual Growing Pains.
And while we continue to work at improving all aspects of the metallization process, our team has done a terrific job bringing these assets online and working through the inevitable startup challenges.
The growth in production led to strong sequential increases and revenue as well as adjusted evida.
In closing, the last month, has been truly transformational for the company reinforcing our role as a national champion with scale durability, and economic Firepower, to lead this reindeer in the United States.
Following the Department of Defense and Apple agreements, we have a clear pathway to continue shareholder value creation as we transform the business into the vertically integrated magnetic solution provider that we have been building towards since day one.
With the investment in convertible preferred stock, and the recent funding of the heavy Rare Earth loan by the dod, as well as our recent Equity offering. Today, we have nearly 2 billion dollars of cash on the balance sheet to execute on our plan.
I just had a question about uh, magnetics margins, which were, uh, pretty impressive. This quarter. Can you just help us understand?
if the broad Strokes of what you just reported in that segment could be,
used to sort of think about,
The you know the the magnetics margins, when you build, you know, 10,000 tons in the future. Thank you.
Yeah, hey George, it's it's Ryan. Um, obviously with the state of maturity of uh, the magnetics business at this point. We're obviously, you know, very pleased and impressed with the result. Um, I think, at at this time, given we're in the stage of producing magnetic precursor products, and delivering those, uh, to our foundational customer. It's not necessarily a perfect proxy for how um the revenue and cost structure will look. Um, once we are in in full production of finished magnets. However, you know, I think that this this level of earnings is something that, you know, likely can be expected. For the next several quarters until we're in production with magnets. And then, once that is ramped, you know, certainly we expect a nice step change up. Um, as we begin, delivering magnets from a total Evita perspective.
Um, you know, we won't get into specific details on on margin and cost structure particularly given, uh, you know, the chunky nature of our of our existing customer relationships. And certainly, when you think about 10x, there's a wide variety of, uh, product types and customer contract types that we expect within that facility. I think the great thing of course, about our contract with the Department of Defense is we do have the guaranteed, minimum earnings level and then certainly, if you extrapolate, what you see at Independence to the 10x facility, um, from an overall pricing perspective. I think that paints some pretty significant upside to the potential earnings power of 10x versus that minimum level.
Thank you. Um, and just as a as a followup different question. But the first, you know, congratulations on all the incredible deals you've been able to put together over the last month.
Um, but it along with that comes a lot of work to do, you know, over the next few years. Um, you know, how comfortable do you feel with building out the ecosystem? Required getting the equipment in place, hiring the right people? You know, all the the the grind work that you have to do to build out.
The additional facilities in time, to kind of Hit the contract time under the articulated to us. Thank you. Thanks George. We are. We are hiring so send us your resumes. We're um, I mean I obviously we have a lot of execution to do and I I think we've been an execution culture since day 1. Um, so we we certainly, uh, understand the scale of the challenge that's ahead of us. And we're we're confident that we'll get it done. These things are never, you know, perfectly in a straight line. Um, but we, we are already maniacally at work at the various pieces that we have to put together, um, and we've been planning for this for quite some time. But Michael, do you want to add a little bit from your perspective?
Yeah, thanks. Jim.
Um, on top of that, we have a core team with experience having built similar assets over the last several years. And, of course, now we're growing. The team is in reference. Um, and we think we can scale that ability over the next several months and year, uh, to help us execute better. You know? In addition we've built, vendor relationships. Uh, we have engineering drawings, we have plans, we have a lot more data than we did several years ago. So our ability to execute these projects, uh, Now versus where we were 2 years ago. There was significantly.
Significantly improved on top of that, we have a deep pass DX rating to help us engage the vendors and service providers to help accelerate. Um,
Uh, you know, progress there. So we're very confident, we can meet, you know, both the dod's aggressive schedule, as well as the complimentary.
And uh, projects and Mountain Pass. Um, and for Apple.
Thanks.
Thanks.
Our next question comes from Benjamin K by please, go ahead.
Hi uh, good evening. Uh, thank you for taking my question.
Um, first, could you talk to us about the separation of facilities, you know, capacity or your thoughts around increasing capacity from what I understand? There's no uh sealing on how much um uh uh concentrate you process. So could you be a processor for uh for third parties and just maybe uh any kind of color around that?
um,
I guess I wish it were the case that there's no ceiling, but I think there is.
some ceiling. Um,
But I think, importantly, we have a lot of flexibility because we have a fully vertically integrated site. We have flexibility as to what kinds of...
Feed stocks, we can process um, and what kinds of impurities we can handle, which I think is unique versus most.
The separation facilities, that may be Standalone, that don't have that ability. Um, so that would be very helpful as we look at more heavy Rich feed stocks to add as complement to our, um, concentrate business. So, we expect our existing concentrate business to ramp up to the 6,000 tons, per Anam of NDP peroxide that we've talked about, um, and then hope to build
um, you know, particularly in regards to Heavies the uh, additional
um,
Separation, you know, for those heavier.
um, and then
follow up is just on.
Mac agreements for 2 106 about, you know, just the Cadence of both you and your customers, uh, you know, wanting to enter a deal. Um, do you want, you know, your customers, want it to be more de-risked and and the facility be closer to the completion or uh or they clamoring. You know the to find a deal now and how do you guys approach that? Thank you guys for
Denim, I already getting the what have you done for me lately, question. I, I was going to go much bigger than that, like, but but I thought, I'd hold off until next quarter. Well, um, I mean, obviously, we're still having a ton of conversations, uh, and, you know, so that continues, but I just remind you that 10x is 100% sold out. Um, and so we have, uh, you know, well, really our entire magnetics business for the next decade is 100% sold out. Obviously, we're going to, uh, Syndicate commercially the vast majority of 10x. Um, but I think we, we have the ability to be very thoughtful about how we do that. And I think, hopefully, we have good track record at this point in, you know, being patient and methodical and selecting the right sequencing of customers, uh, and making sure that that we do. So in a way, that is, frankly attractive for our business. But also, uh, create win-win Partnerships for us and the customer. And I think, you know,
Our expectation is we'll continue to do that as we build out 10x.
Great. Thank you guys very much. Yeah.
Our next question comes from Lawson, Linda.
Bank of America, please go ahead.
Great. Thank you, operator. And and Jim and Ryan, thank you for today's update and and um, yeah, congratulations on everything. You've achieved over the last, uh, quarter at Michael but thank you. Sorry, Michael. Not definitely not forgotten.
Um your your work is very much appreciated. Also, thank you. Um,
Wanted to ask about um the assumptions around the 650 million. Minimum guidance for materials plus 10x Magna, Plus Independence magnets. Um, what does that include in terms of assumption around oxide sales to, to third parties. And and is there an assumption baked in there that some oxides will be sold to China.
Hey Lawson, it's Ryan uh sure. Uh I'll take that we are um
Under the dod agreements no longer selling. Um any of our products into the Chinese market. So it does not assume any oxide sales um into the Chinese market. I would say though, if you do the math, depending on the type of magnet that you're talking about, certainly bringing our total capacity to a finished magnet equivalent of 10,000 tons. Um, that does leave room for external sales.
Of that assumption.
And none of the magnetic side that 650 just assumes the minimum contracted ibida from the Department of Defense or the 10x facility. Which as I laid out, I think has some very significant upsides. Some of which, of course we share with our our partner in DOD as that, um, facility scales into producing for commercial customers as well. And it assumes, um, relatively conservative assumptions as to our buildout and ramp of Independence,
Um, and so in the slide deck that we provided in the prior conference call, you can sort of see the relative sizes of all of those pieces. But that's the underlying overall set of assumptions.
That's great. Thank you Ryan. Um, as a follow-up. Can I ask about another investment related to, uh, the um, agreement with the Department of Defense and that is the, uh, hydrochloric acid facility at Mountain Pass? Is that in addition to the chalk Alkali facility, and then should we expect that investment to further? Reduce your cost of that very critical input of of hydrochloric acid to your separation process and and then just drawing that to the final conclusion. I mean, can we see an improvement in the, in the low 40 dollar per kilogram marginal cost, assumption, that you guys have made for a fully ramped up. Separation facility
Sure, uh, losing your stuff with me again on that one. Um, you know, I... I...
I wouldn't say that it necessarily spells, you know, a change in our overall cost structure Target. I think, you know, we actually had a slide in last quarter's earnings deck that had a very strategically shaded area uh that spoke to potential upside from um lower overall. Production costs from the uh, core Alkali facility 8. The HCL facility that you see in the transaction agreements is the same thing as the core alkaline facility to be clear. And and from our perspective, we think that this investment is not just 1 in cost savings but redundancy and resiliency, um, you know, we believe that we will always have some level of external um, uh, hydrochloric acid and caustic soda. Uh, production for our business. We are a very large consumer of both of those products. And so having the flexibility both to pull from the
Outside Market, as well as produce internally in a full closed loop. We think is important. We strategically, you know, launched our separations facilities, um, by breaking that closed loop and building out the infrastructure and supply chain, that's required to support, um, our levels of production. And then we believe bringing, um, you know, portions of that HCL facility or corac facility on
Online methodically in continuing to support. You know, our external supply chain will be, uh, the best way forward both from a cost and redundancy perspective.
Okay, fantastic. Thanks very much Ryan.
Our next question comes from David. DeLeon from TD coming, please go ahead.
Hey, David.
Um, thanks for the time. Um, I wanted to just follow up on just the...
some of the the records set at mountain pass this quarter on a concentrate side.
For those initiatives incremental to upstream $60K, or are they part of it? Um, I guess I'm just thinking about, you know, as we progressed up upstream $60K, it seems like...
Some of the tweaks are perhaps happening sooner than anticipated? But you know, I'm kind of curious if this is viewed as a recovery tweak. On top of that, just with having a higher grade,
Well, thanks for the question. Um,
I'd say these are
Parts of option 6TK, I think upstream $60K included, categories of optimization.
and I'd say, our Metallurgy team and operations teams have done an incredible job of
uh,
Uh implementing and executing changes. Um, and I think we continue to be impressed that our our body is able to support higher grade concentrate. Um, you know, as we focus on that.
Um, in order to help them extreme business. So I wouldn't say it's incremental but uh we are hopeful that.
We can achieve the same goals with less capital and more optimization.
Appreciate that. And then just as a follow-up to this on NDPR oxide, your guidance obviously suggests that you'll be stockpiling concentrated at this point. The DOD agreement goes into place in Q4.
you'll continue ramping production throughout the year, but stockpiling the products, uh, for sales, you know, once a DOD agreement is in place because I'm, I'm just wondering the
As we assess, uh, the, the ramp of the, the stage 2 facility, um, you know, was that going to be more evidential into 26, or should we be able to track those kpis throughout the year?
Did it all start and I, I'll let some of the production specific, uh, portions to Michael. But as it relates to sales, we can continue to have a really robust, uh, order backlog and sales pipeline for, third-party customers, for ndpr oxide. And so, you know, we're continuing as we ramp production to expect to sell the vast majority of NPR oxide, um, out into third parties, of course, as our metal production and magnet production at Independence ramps, you know, we will become a larger internal customer of our own oxide, but, um, we, we do expect, you know, to continue to for the most part, you know, uh,
Focus on our strategic customers, particularly in the Japanese market, the South Korean market, and broader Southeast Asia. Michael, flip it to you for your thoughts on production.
As a reference, we planned for a 10% to 20% increase over the next quarter, and that's largely consistent with the progressive growth that we've seen over the last.
Year and a half, and we would expect that sort of pace.
To continue not in a linear.
Basis. But uh, just generally speaking step by step Improvement, um, getting better every day.
Thanks David.
The next question comes from Lawrence Alexander with Jeffrey's please. Go ahead.
So follow up. Just I want to tease out um your how you relate to the offset of about being kind of The Branding, at the national US national champion and the bandwidth.
And the high degree of visibility on returns. I mean, for the next decade. So can you keep out first? Are you allowed to sell?
Into European or other countries. Can you expand the number of countries you sell products into, or just to do?
Agreements in any way you respect that.
Actually you can use refills or layouts or the ramifications for the mou restaurant in for the potential project in Saudi Arabia.
Um, do you have bandwidth to continue exploring that?
And then third, I appreciate that there will be announcements just filling in the capacity that the DOD is underwriting. But if you've been giving, you have such a strong visibility on the returns on that.
What would be your return on Capital hurdle to look at any other uses of capital or uses of empty? You know, bandwidth?
Thanks Lauren. Well, first off, there's nothing that restricts us from selling into Europe, you know. Obviously as part of DOD we just won't be selling to to hostile States. Um, and then as far as, uh, you mentioned, uh, Saudi modern, I I think if you look at the vertically integrated,
Player that we've built. I mean we are the only company in the world and that includes China that has all aspects of his business which I believe is a. And you know, as we've said from the beginning, is sort of the right structure to really um scale and be low cost accelerate, you know, at at a, you know, astonishing pace, so to speak and doing all of these pieces. And and obviously that um, relation that relationship speaks to us as being the right partner around the world. Um, to add to this supply chain. Particularly, as you know, America's national champion. I would tell you that as far as bandwidth and and capital certainly
From a return on Capital standpoint for MP. I think it's actually an accelerant, uh, for our, our shareholders in the sense that because we have this capability and position, which brings a number of attributes that we're going to be able to continue to grow the business. Um, again, in a more Capital light way. Uh, but, you know, potentially having some of the same economics, which in mathematically means higher Returns on Capital.
Thank you.
Thanks next question.
Our next question comes from Carlos to Alba with Morgan Sandy. Please go ahead.
Yeah, thank you very much, guys. Um, a couple of questions. First 1 is, um, can you maybe share a little bit of color on? What are the Milestones um, that you need to get for Apple to um, these boards that dollars in the coming years that you you mentioned? And also any any, um,
Progress on the 1 billion financing in, you know, that would support the development of of the 10x facility.
Hey Carlos, it's Ryan. Um,
Obviously, I'm not going to get into specific, you know, contract details on our agreement with Apple. Um, you know, I think that...
What we have made clear is that those disbursements will come um, on a milestone basis, um, ahead of production. And so we've targeted production for Mid 2027. So you know, hopefully that that gives you a pretty tight range. Of when the cash is going to come in. I, I think we, you know, we tend to try to set up our customer relationships, as, as Jim laid out in a, a win-win passion. Where, you know, we ensure that we are maximizing our cash on cash returns while ensuring that our customers receive visibility into fourth progress, um, on, you know, the items that that we've promised them. And so we think the structure works quite well for both of us.
Um,
as a relates to your question on the the billion dollar Bridge facility. Um you know, I I think
I I wouldn't overly focus on on that facility particularly because our our recent Equity Rays um gets netted against that you know a bridge is exactly what it sounds like. It's a temporary Solution that's put in place as part of an announcement you know often in m&a announcements and so for us, you know, it's it's really served its purpose. Um, you know what we expect to do over the next several years is is exactly what we've done, frankly over the last 5 plus years as a public
The company, which is the extremely thoughtful about our balance sheet ensures that, um, you know, at this point, frankly we are well capitalized to execute, um, on on the projects that we've laid out. We'll continue to focus on efficiency, both on the expenditure side, and the balance sheet side and we'll be opportunistic. As we always are to ensure that you know, we're financing all of this growth in the right way. Yeah. And and 1 thing to just add, Carlos in, um, in the prepared remarks you may have heard, but if not, you know, Brian mentioned we have post, um, post the funding and the raise Etc. We have approximately 2 billion of cash on our balance sheet right now. Uh, so that and then, as you look out over the coming years, where we have a dramatic step function, change upwards, um, in cash flow generation. That's contracted over the next, uh, decade. Um, you know, we really, uh, have a fortress balance sheet to be completely opportunistic in how we, uh,
Managed going forward. So we we feel really good about our position.
Yeah, I know for sure. All right. Thanks and um,
May just stepping back and thinking more to digitally. Um, I would like to understand how scalable will the recycling line or recycling facility, that that you are building, uh, you know, will be um,
Could this potentially allow you to become much bigger in magnetics without the need of mining? Uh,
you know, feed stock
That's a great question, Carlos. Um,
initially, our build is obviously to satisfy our requirements for
For Apple. Um, in addition our own magnetic plans will produce swarf and other byproducts that um, will have the opportunity to recycle and from that recover and optimize maximize the
The, um, heavy Rare Earth content and ensure we maximize that usage. Um,
you know, on top of that, obviously the 10x facility will produce its
To build a facility, that's modular that can grow with the market that can recover end of life, materials and or third-party feed stocks and this both extends the life of mountain pass and creates opportunity for future growth.
Um but you know related to previous comments earlier, there's not unlimited capacity or capability so we would, you know, have to have to balance that in the in the medium term.
Uh, fantastic. Well, thank you very much, guys. Jim, Brian, M, thank you.
Our next question comes from Bill Peterson. JP Morgan. Please go ahead.
Yeah. Hi good afternoon. Congrats on all the progress and strong execution in a quarter. Um, maybe following up that last recycling question, I guess, how do you turn on approaching this internally developed recycling processes at acquiring technology Partnerships for third parties? And, you know, maybe what does Apple bring to this, uh, you know, recycle this or I guess they're early stages of the recycling program?
I think. So the question I think, as we've mentioned in um, in other Forum we've been working on on recycling, uh, in cooperation with Apple for over 5 years. So we have made a lot of progress. Um,
And I think over the next several years, um we have other plans to cooperate with our customers and Technical Partners on further. Advancing our technical capability both in recycling and using recycled materials, um and optimizing magnet, uh properties.
Um,
um,
I think that was, yeah, I think that get your question bill or did you you you have a second part to that? No, no, no, sorry. I didn't know if you were continuing thought. No, I I do have a second question. Um, in terms of, in terms of magnet Readiness, I guess for your lead, customer are there any sort of remaining technical areas to address before commercial ramp? How are the, you know, is the products performing from a technical point of view? And, you know, I just want to get a sense for how you're you're tracking to the commercial launch. Uh,
You know, in the coming quarters.
Really significant strides. They're actually probably more than I even expected.
Really what is left at this point is taking what we've been doing in our new product introduction facility, which as you saw is much more of a pilot line is sort of a factory within a factory that's allowed us to iterate quickly to be able to generate the types of results that we have and just transferring one.
What we've done there into larger commercial production.
With any start up it is not a straight line. So I will not promise a straight line, but we have a lot of confidence in the team, particularly given what they've demonstrated to date.
A lot of the major process areas are already either in commissioning or commissioned.
And seeing those operate give us further confidence in the underlying assumptions that we built in both into the business case and operating case and so.
The proof will be in the putting over the next several quarters.
But that's what's left is going from trial to commercial.
Thanks, Ron and Michael and Jim and really again nice job in execution.
Thank you.
And my last question comes from Matt Summerville with two Oklahoma from please go ahead and ask your question.
Excuse me can you guys hear me.
Yes, Hey, Matt Okay cool okay.
So I wanted to get back to some comments you made regarding stage, one whats driving the improvement in concentrate grade and I guess I want to understand how you modulate going after incremental volume versus going after incremental grade and do you need the incremental grade to get <unk>.
Page two output to where you ultimately.
Hit the nameplate.
Thanks Ben.
I guess.
And in a stable environment Theres, a tradeoff between grade and recovery.
Historically, we have tried to hold the stable grade and increase the recovery to increased production volume.
In recent quarters, we had seen that we were kind of able to tweak upgrade without significant sacrifice of recovery through some of the optimizations through some of the previous.
The initial stage.
Upstream 60 K projects.
And I think we're still harvesting some of those gains.
In addition, as we've simplified.
Parts of our circuit, it's enabled us to get grade higher without sacrificing recovery.
And I think those opportunities continue.
Some of our next initiatives to relate to creating even higher quality.
Concentrated in that.
Should have follow on benefits to the primarily the cost structure of the stage two of the midstream operation.
But also too.
The ultimate throughput capability of that.
So I don't say its absolutely necessary at this point I think we're very comfortable with the.
The ability to.
To ramp the facility with the current concentrate but incrementally pure concentrate will make that even better.
So should I just as a follow up should I take that to mean that you.
Do you feel you can push the limit of that 675 tonnes of oxide absent major incremental capital investment or should I not make that conclusion.
I wouldn't connect those two together.
So no I don't we don't need any improvement in the concentrated in order to hit that nameplate.
Got it I'll leave it there thank you.
Well. This concludes the question on proportional phones cool I'll now hand, the Cooper.
For closing remarks.
Hey, everyone. So obviously this was an extraordinary quarter.
Really proud of what we achieved obviously operationally but in particular.
The agreements with D O D and Apple and clearly the platform that we have that we've been building for a number of years has changed for the better dramatically and we expect to take this new position and keep on reaching two.
Continue to build on the gains that we've had thoughtfully and so with that we will get back to work and I have a have a great day everyone.