Q2 2026 Caledonia Mining Corp PLC Earnings Call

August 10, 2026

Speaker #1: Welcome to the Caledonia Mining Q2 trading update. We're joined by Mark Lermas and the management team. Mark, over to you.

Moderator: Welcome to the Caledonia Mining Q2 Trading Update. We are joined by Mark Learmonth and the management team. Mark, over to you.

Operator: Welcome to the Caledonia Mining Q2 Trading Update. We are joined by Mark Learmonth and the management team. Mark, over to you.

Speaker #2: Thank you, Scott. Could we get into the presentation please? Okay, well, good morning, good afternoon to you. Should we just quickly go to the disclaimer page?

Mark Learmonth: Well, good morning, good afternoon to you. Could we just quickly go to the disclaimer page? And then on to the presenting team. So I am Mark Learmonth, Caledonia's Chief Executive, and we are joined today by Ross Jerrard, the CFO; Victor Gapare, another Executive Director who is running the Bilboes project; by Craig Harvey, VP Technical Services, he runs Exploration and MRM. And also in attendance we have got Maurice Mason, who is Vice President of Corporate Development and Investor Relations. Should we move on? Just in terms of an overview, production was up 18% in Q2 compared to Q1, which reflects improved access to higher grade mining areas and benefits from various operating improvements.

Speaker #2: Okay. And team. So I'm Mark Lermas, Caledonia's Chief Executive, and we're joined today by Ross Gerrard. The CFO, Victor Kapari, another executive director who's running the Bill Bose project, by Craig Harvey, VP Technical Services.

Speaker #2: He runs exploration and MRM, and also in attendance we've got Morris Mason, who's Vice President, Corporate Development and Investor Relations. Should we move on?

Speaker #2: Okay, just in terms of an overview, production was up 18% in the second quarter compared to the first quarter, which reflects improved access to higher-grade mining areas and benefits from various operating improvements.

Speaker #2: Revenue was up 16% to $76 million, and EBITDA increased 16% to nearly $46 million, supported by stronger production and a robust gold price environment. Profit after tax rose 27% compared to the same period in 2025, reaching $30 million.

Mark Learmonth: Revenue up 16% to USD 76 million and EBITDA up 16% to nearly USD 46 million, supported by stronger production and a robust gold price environment. Profit after tax up 27% compared to comparable period in 2025, up to USD 30 million. EPS was up 29% to USD 1.36 for the quarter. Operating cash flow was strong, USD 28.4 million. And cash and cash equivalents at the end of the quarter was USD 167.8 million. The growth pipeline is going well. We are making good progress at Bilboes, Victor will explain. We have got some very exciting exploration results coming out of Motapa, where we expect to produce a maiden resource in the next four weeks or so. But also some quite exciting exploration results coming out of the K-Pits at Blanket. And just for the record, we have declared our usual quarterly dividend of USD 0.14 a share for the quarter. Should we move on to the next slide?

Speaker #2: EPS was up 29% to $1.36 for the quarter. Operating cash flow was strong, $28.4 million and cash and cash equivalents at the end of the quarter was $167.8 million.

Speaker #2: The growth pipeline is going well. We're making good progress at Bill Bose, as Victor will explain. We've got some very exciting exploration results coming out of Matapa.

Speaker #2: Where we expect to produce a maiden resource in the next 4 weeks or so. And also some quite exciting exploration results coming out of the Cape It at Blanket.

Speaker #2: And just for the record, we've declared our usual quarterly dividend of $14 per share for the quarter. Should we move on to the next slide?

Mark Learmonth: And just for the record, we have declared our usual quarterly dividend of USD 0.14 a share for the quarter. Should we move on to the next slide? I am going to counter through these operating results quite quickly. I mean, really there is one thing that comes out and is grade. But before we get to that, let us talk about safety. An excellent safety performance for the quarter. We have had, well, now it must be over 400 consecutive days without any lost time injury. And that is nearly 5.5 million man-hours worked without an LTI. So that is a very good performance. Clearly, that is sort of a lagging indicator. And the strong safety performance really reflects a couple of things. The first is the extent to which we are focusing on proactive and preemptive risk prevention.

Speaker #2: Okay, I'm going to count us through these operating results quite quickly. I mean, really, there's one thing that comes out and it's grade. So if we just move on.

Mark Learmonth: I am going to counter through these operating results quite quickly. I mean, really there is one thing that comes out and is grade. But before we get to that, let us talk about safety. An excellent safety performance for the quarter. We have had, well, now it must be over 400 consecutive days without any lost time injury. And that is nearly 5.5 million man-hours worked without an LTI. So that is a very good performance. Clearly, that is sort of a lagging indicator. And the strong safety performance really reflects a couple of things. The first is the extent to which we are focusing on proactive and preemptive risk prevention. So things like, we have undertaken risk propensity assessments on workers in high-risk areas. We are putting a strong focus on near-miss reporting and things like that.

Speaker #2: But before we get to that, let's talk about safety and excellent safety performance. For the quarter, we've had—well, now it must be over 400 consecutive days without any lost time injury.

Speaker #2: And that's nearly 5.5 million man-hours worked without an LTI. So that's a very good performance. Clearly, that's sort of a lagging indicator. And the strong safety performance really reflects a couple of things.

Speaker #2: The first is the extent to which we're focusing on proactive and preemptive risk prevention—so things like we've undertaken risk propensity assessments on workers in high-risk areas.

Mark Learmonth: So things like, we have undertaken risk propensity assessments on workers in high-risk areas. We are putting a strong focus on near-miss reporting and things like that. Trying to preempt and predict where problems might be so that we can address them. What underpins all of this is a renewed focus on training, culture, and readiness. A very pleasing safety performance, and congratulations to the mining team for achieving that. Shall we move on? Production has recovered in the quarter, and that really comes down to improved access to higher-grade areas. As we said previously, we have been hampered over the last few quarters by some fall of ground incidents in the course of 2025, which locked us out of high-grade areas. We have been effectively running the mine at a very low grade. In Q1, it was 2.5 gram of a ton.

Speaker #2: We're putting a strong focus on near-miss reporting. And things like that. So trying to preempt and predict where problems might be so that we can address them.

Mark Learmonth: Trying to preempt and predict where problems might be so that we can address them. What underpins all of this is a renewed focus on training, culture, and readiness. A very pleasing safety performance, and congratulations to the mining team for achieving that. Shall we move on? Production has recovered in the quarter, and that really comes down to improved access to higher-grade areas. As we said previously, we have been hampered over the last few quarters by some fall of ground incidents in the course of 2025, which locked us out of high-grade areas. We have been effectively running the mine at a very low grade. In Q1, it was 2.5 gram of a ton.

Speaker #2: And what underpins all of this is a renewed focus on training culture and readiness. So a very pleasing safety performance and congratulations to the mining team for achieving that.

Speaker #2: Should we move on? Right, production has recovered in the quarter. And that really comes down to improved access to higher-grade areas. And as we said previously, we've been hampered over the last few quarters by some fall of ground incidents.

Speaker #2: In the course of 2025, which locked us out of high-grade areas. So we've been effectively running the mine at a very low grade. In the first quarter, it was 2.5 grammes a tonne.

Speaker #2: In this second quarter, it was about 2.88. And we're now targeting about 3.1 for the remainder of the year. And we're operating at that level.

Mark Learmonth: In Q2, it was about 2.88, and we are now targeting about 3.1 for the remainder of the year, and we are operating at that level. So higher access to higher-grade areas. We also, in June, moved the mine onto a 7-day working week, primarily to address worker fatigue, but it also means that we have increased our blasting days by 18%, and that is flowing through into increased run-of-mine production. From September onwards, we will be processing a portion of that incremental production through the Lima plant, which we will repurpose. Then into 2027, we will be spending some money, as you will hear shortly, to upgrade the main metallurgical plant to process all of that existing run-of-mine material through the main plant.

Speaker #2: So higher access to higher-grade areas, we also in June moved the mine onto 7-day working week. Primarily to address worker fatigue, but it also means that we've increased our blasting days by 18%.

Speaker #2: And that is flowing through into increased run-of-mine production. And from September onwards, we'll be processing a portion of that incremental production through the Lima plant, which we'll repurpose.

Speaker #2: And then into 2027, we'll be spending some money, as you'll hear shortly, to upgrade the main metallurgical plant to process all of that existing run-of-mine material through the main plant.

Speaker #2: By the end of this month, the end of August, we will have completed an upgrade to the elution plant, which will allow us to process about 40 tonnes of material that we've accumulated over the last 18 months or so, at a grade of 600 or 700 grammes a tonne.

Mark Learmonth: The end of this month, the end of August, we will have completed an upgrade to the Elution plant, which will allow us to process about 40 tons of material that we have accumulated over the last 18 months or so, at a grade of 6 or 700 grams a ton. That will give us an extra 1,200 ounces across the months of September, October, November, December. Q2 was well ahead of Q1 on the back of the higher-grade access. Shall we move on to the next page? Traditional graphs, which we have seen before. I think the key things I would draw out here are the top graph, the blue line, the stability that we have experienced now for many quarters. That really is because of the stockpile that we developed and we have been running.

Speaker #2: So that will give us an extra 1,200 ounces across the months of September, October, November, December. And the Q2 was well ahead of Q1 on the back of the higher-grade access.

Speaker #2: So should we move on to the next page? Traditional graphs, which we've seen before, I think the key things I'd draw out here are the top graph, the blue line, the stability that we've experienced now for many quarters.

Speaker #2: And that really is because of the stockpile that we developed and we've been running. Fair to say, during this quarter, Q2, the stockpile was—now we've started to rebuild that since we introduced the new shift system in June.

Mark Learmonth: Fair to say, during this quarter, Q2, the stockpile was run down to zero and now we have started to rebuild that since we introduced the new shift system in June. The bottom line in that top graph is the grade, and you can see how the grade came down from Q2 2025, reached a low point in Q1, and has now recovered. As I say, in Q2, running at 2.88 grams a ton, target for the remainder of the year on average is about 3.16, and we are running at that level. Then the bottom graph just pulls it all together in terms of looking at the recovery and the ounces produced. It is fair to say that as the grade falls, your recovery falls. The tail grade, we cannot do much better than a tail grade of 0.2 grams a ton.

Speaker #2: The bottom line in that top graph is the grade. And you can see how the grade came down from Q2 2025, reached a low point in the first quarter, and has now recovered.

Speaker #2: As I say, in the second quarter, running at 2.88 grammes a tonne, target for the remainder of the year on average is about 3.16.

Speaker #2: And we're running at that level. And then the bottom graph just pulls it all together. In terms of looking at the recovery, and the ounces produced, it's fair to say that as the grade falls, your recovery falls.

Speaker #2: The tail grade—we can't do much better than a tail grade of 0.2 grams a tonne. And so, frankly, if the head grade goes down and the tail grade stays at 0.2, that means your recovery goes down.

Mark Learmonth: Frankly, if the head grade goes down and the tail grade stays at 0.2, that means that your recovery goes down. It is good to see that recovery bounce back again. Move on. That is just an overview of the operations. It all comes down to grade. With that, I will hand over to Ross, who has got quite a lot to cover.

Speaker #2: So it is good to see that recovery bounce back again. Move on. So that's just an overview of the operations. It all comes down to grade.

Speaker #2: So with that, I will hand over to Ross, who's got quite a lot to cover.

Speaker #1: Thank you, Mark. And good afternoon, everyone. Just running through the financial results summary. Up on the table, you can see the impact of both gold sold and gold ounces produced.

Ross Jerrard: Thank you, Mark, and good afternoon, everyone. Just running through the financial results summary. Up on the table, you can see the impact of both gold sold and gold ounces produced. We were down for both the three months and the six months in terms of ounces. But we did benefit from a higher average realized gold price of $4,259 an ounce. That was a 34% increase quarter on quarter. We did produce some healthy revenues. As we go through our cost profile, that is one of the impacts in terms of higher royalties driven by those higher revenues. I will take a bit of time to go through our cost updates in terms of where we ended up. But the key message is really our online costs were largely in line with where we had budgeted and we are managing to.

Speaker #1: So we were down for both the 3 months and the 6 months in terms of ounces. But we did benefit from a higher average realised gold price of £4,259 an ounce.

Speaker #1: So that was a 34% increase quarter on quarter. So we did produce some healthy revenues. And as we go through our cost profile, that's one of the impacts in terms of higher royalties driven by those higher revenues.

Speaker #1: I will take a bit of time to go through our cost updates in terms of where we ended up. But the key message is really our online costs were largely in line with where we had budgeted.

Speaker #1: And we're managing to. So an absolute terms, whilst those costs are shown to be up, there are some one-off or abnormal items that I'll talk you through in terms of why those transactions occurred.

Ross Jerrard: In absolute terms, whilst those costs are shown to be up, there are some one-off or abnormal items that I will talk you through in terms of why those transactions occurred. But broadly, we are very happy with our online costs and the teams are managing their cost base very well. Those top-line ounces really impacted on our unit metrics in terms of an ounce sold basis. You will see our all-in sustaining and our online costs per ounce sold were largely up. But there were some quite significant increases on our ounce profile metric. But in absolute terms, we are broadly in line. Going into our financials, we are very happy with our EBITDA. That was up some 28.5% for the six-month period. As you can see, some healthy numbers going through in terms of free cash flow and ultimate profit and earnings per share.

Speaker #1: But broadly, we're very happy with our mine costs and the teams who are managing their cost base very well. Those top-line ounces really impacted on our unit metrics in terms of an ounce sold basis.

Speaker #1: So you'll see our all-in sustaining and our online cost per ounce sold were largely up. There were some quite significant increases on an ounce-profile metric.

Speaker #1: But in absolute terms, we're broadly in line. Going into our financials, we're very happy with our EBITDA. That was up some 28.5% for the 6-month period.

Speaker #1: And as you can see, some healthy numbers going through in terms of free cash flow and ultimate profit and earnings per share. Probably to highlight and remind everybody, our free cash flow number, the comparative period included our solar sale proceeds.

Ross Jerrard: Probably to highlight and remind everybody, our free cash flow number comparative period included our solar sale proceeds. That is probably not indicative of a normal operating cycle, but we are very happy in terms of where we ultimately ended up with some $23.8 million worth of profit, at the end of the three-month period, and close to $40 million for the six months or almost 35% up against the comparative period. If we can move on to the next slide and talk a little bit about the profit and loss. You will see our top-line revenue, as indicated, that was really driven by that higher average gold price, albeit that some of our sales ounces were a little bit down. But we are very happy in terms of our ultimate gross profit position, which was up some 17.4% for the six months or 16% for the quarter.

Speaker #1: So that's probably not indicative of a normal operating cycle. But we're very happy in terms of where we ultimately ended up, with some $23.8 million worth of profit at the end of the 3-month period, and close to $40 million for the 6 months, or almost 35% up against the comparative period.

Speaker #1: If we can move on to the next slide and talk a little bit about the profit and loss. You'll see our top-line revenue is indicated.

Speaker #1: That was really driven by that higher average gold price. Albeit that some of our sales ounces were a little bit down. But we're very happy in terms of our ultimate gross profit position, which was up some 17.4% for the 6 months or 16% for the quarter.

Speaker #1: Royalties were up, but that was driven by that higher top-line performance, and also, we did have some shipments during the six months. I think there were three shipments over the $5,000 per ounce level, which attracted the higher royalty.

Ross Jerrard: Royalties were up, but that was driven by that higher top-line performance. Also, we did have some shipments during the 6 months, I think there were three shipments over the USD 5,000 per ounce level, which attracted the higher royalty. But in terms of our production costs, we are up some 15% year to date, and I will talk to some of those specific items that went through. There were some timing differences. As already highlighted by Mark Learmonth, there was a drawdown on the stockpile and obviously the costs that are released in terms of those ounces as they are put through, it does have a working capital impact. Below the line in terms of significant movements, probably the one to highlight is the administration expenses.

Speaker #1: But in terms of our production costs, we are up some 15% year to date. And I'll talk to some of those specific items that went through.

Speaker #1: And there were some timing differences. As was already highlighted by Mark, there was a drawdown on the stockpile and, obviously, the costs that are released in terms of those ounces as they are put through do have a working capital impact.

Speaker #1: Below the line, in terms of a significant movement, probably the one to highlight is the administration expenses. And there were some quite significant one-off costs that have related to our advisory fees particularly on the senior loan note transaction.

Ross Jerrard: There were some quite significant one-off costs that have related to our advisory fees, particularly on the senior loan note transaction, but our broader financing facility. As we go through those and our overall strategy, you will see that we have made some significant progress in terms of our funding initiatives. So it is money well spent in terms of those work streams. I will also highlight the fair value gain on our derivative financial instruments. So, that is financial accounting and some volatility that will go through the P&L and it does result in some significant movements. But I would ask you really to treat those as separate items when you are looking at the P&L because, they are really driven by some quite complex accounting. I have got a couple of slides that I will talk to you a little bit later in the deck.

Speaker #1: But our broader financing facility and as we go through bill those and our overall strategy, you'll see that we've made some significant progress in terms of our funding initiatives.

Speaker #1: So it's money well spent in terms of those workstreams. I will also highlight the fair value gain on our derivative financial instruments. That is a financial accounting item, and some volatility will go through the P&L, which does result in some significant movements.

Speaker #1: But I would ask you really to use the treat those as separate items when you're looking at the P&L because they're really driven by some quite complex accounting.

Speaker #1: And I've got a couple of slides that I'll talk to you a little bit later in the deck. But overall, we're very pleased with our profit for the period.

Ross Jerrard: Overall, we are very pleased with our profit for the period, up some 27% for the 3 months at USD 30 million and up 40% for our 6-month period, just shy of USD 50 million. The tax expense was down, but that was really around the capital gains tax that was paid in the comparative period. So, I guess our tax rate and effective tax rate is in line, and we are very happy with that. If we turn to the next slide, please. In terms of cash flows, probably the items to note is really the rolling of our various loan notes. So you will see some ebbs and ups. But actually, there is no movement in terms of our net position there. In terms of pointing out significant movements, you will see the acquisition of our capped call options. So the USD 14.4 million in the 6-month period was a one-off item that came through.

Speaker #1: Up some 27% for the 3 months. It's a 30 million. And up 40% for our 6-month period. Just shy of 50 million dollars. The tax expense was down, but that was really around the capital gains tax that was paid on the solar in the comparative period.

Speaker #1: So I guess our tax rate and effective tax rate is in line and we're very happy with that. Return to the next slide, please.

Speaker #1: In terms of cash flows, probably the item to note is really the rolling of our various loan notes. So you'll see some ins and outs, but actually there's no movement in terms of our net position there.

Speaker #1: In terms of pointing out significant movements, you'll see the acquisition of our cap call options. So, the $14.4 million in the six-month period was a one-off item that came through.

Ross Jerrard: So the USD 14.4 million in the 6-month period was a one-off item that came through. Equally, you will see the impressive USD 145 million of proceeds in the convertible notes that came through and bulking up our cash at the year-end position, which closed at just shy of USD 168 million closing cash, which really puts us in good stead as we move forward in terms of our strategic objectives. If we move to the next slide, you will see our overall liquidity position. We are very pleased with our cash on hand at USD 171 million. There was bullion on hand of USD 13.5 million, which was really the ounces that are held on hand and ready for shipment. There was a slight delay on one shipment at the end of the 6-month period, which was driven by the demonstrations in Johannesburg.

Speaker #1: And equally, you'll see the impressive $145 million of proceeds in the convertible loan notes that came through and bulked up our cash at the year-end position, which closed at just shy of $167 or $168 million closing cash. This really puts us in good stead as we move forward in terms of our strategic objectives.

Ross Jerrard: Equally, you will see the impressive USD 145 million of proceeds in the convertible notes that came through and bulking up our cash at the year-end position, which closed at just shy of USD 168 million closing cash, which really puts us in good stead as we move forward in terms of our strategic objectives. If we move to the next slide, you will see our overall liquidity position. We are very pleased with our cash on hand at USD 171 million. There was bullion on hand of USD 13.5 million, which was really the ounces that are held on hand and ready for shipment. There was a slight delay on one shipment at the end of the 6-month period, which was driven by the demonstrations in Johannesburg. So there was a timing difference in terms of ounces that were held, as we got them to the refiner.

Speaker #1: So if we move to the next slide, you'll see our overall liquidity position. And we're very pleased with our cash on hand at 171 million dollars.

Speaker #1: There was bullion on hand of $13 million, $13.5 million, which was really the ounces that are held on hand and ready for shipment.

Speaker #1: There was a slight delay on one shipment at the end of the 6-month period, which was driven by the demonstrations in Johannesburg. So there was a timing difference in terms of ounces that were held as we got them to the refiner.

Ross Jerrard: So there was a timing difference in terms of ounces that were held, as we got them to the refiner. But those were delivered the day after, and it was really driven by timing. So nothing untoward to highlight there. But overall, very pleasing to have a total liquidity of over $200 million as we stand at the end of the June period. A very healthy position as we move forward with the company and the various initiatives. The next slide just talks to our capital structure and debt. We included that in terms of just summarizing basically our debt structure, what's held at our Caledonia Holdings Ltd level in terms of our loan notes. As I mentioned, those movements that you see were really the successful rolling over of loans in terms of what was expiring. We are not intending to increase or decrease.

Speaker #1: But those were delivered the day after, and it was really driven by timing, so nothing untoward to highlight there. But overall, very pleasing to have a total liquidity of over $200 million as we stand at the end of the June period.

Ross Jerrard: But those were delivered the day after, and it was really driven by timing. So nothing untoward to highlight there. But overall, very pleasing to have a total liquidity of over $200 million as we stand at the end of the June period. A very healthy position as we move forward with the company and the various initiatives. The next slide just talks to our capital structure and debt. We included that in terms of just summarizing basically our debt structure, what's held at our Caledonia Holdings Ltd level in terms of our loan notes. As I mentioned, those movements that you see were really the successful rolling over of loans in terms of what was expiring. We are not intending to increase or decrease. It is really status quo in terms of those loan notes, and what we are wanting to do is allocate those against strategic projects.

Speaker #1: A very healthy position as we move forward with the company and the various initiatives. The next slide just talks to our capital structure and debt.

Speaker #1: And we included that in terms of just summarizing basically our debt structure. What's held at our Caledonia Holdings ZIM level in terms of our loan notes and as I mentioned, those movements that you see were really the successful rolling over of loans in terms of what was expiring.

Speaker #1: We're not intending to increase or decrease. It's really status quo in terms of those loan notes, and what we're wanting to do is allocate those against strategic projects.

Ross Jerrard: It is really status quo in terms of those loan notes, and what we are wanting to do is allocate those against strategic projects. And in terms of our borrowings, we are keeping the facility levels at the same level. We have paid down a large portion of that. So we are sitting in a very healthy position in terms of overall funding. Then, in terms of the new convertible bond that is from the balance sheet increasing our total consolidated structure up to that $167 million that I had mentioned previously. So that just gives you a picture in terms of overall debt. Taking a bit more of a deep dive into those on-mine costs, if we move to the next slide.

Speaker #1: And in terms of our borrowings, we're keeping the facility levels at the same level. We have paid down a large portion of that. So then we're sitting in a very healthy position in terms of overall funding.

Ross Jerrard: And in terms of our borrowings, we are keeping the facility levels at the same level. We have paid down a large portion of that. So we are sitting in a very healthy position in terms of overall funding. Then, in terms of the new convertible bond that is from the balance sheet increasing our total consolidated structure up to that $167 million that I had mentioned previously. So that just gives you a picture in terms of overall debt. Taking a bit more of a deep dive into those on-mine costs, if we move to the next slide. We just wanted to highlight in terms of on-mine costs at Blanket, and I think it is very important to pull out a few key, I guess, transactions or cost centers. The first one is salaries and wages.

Speaker #1: And then in terms of the new convertible bond that sits on the balance sheet, increasing our total consolidated structure up to that $167 million that I've mentioned previously.

Speaker #1: So this gives you a picture in terms of overall debt. Taking a bit more of a deep dive into those online costs—if we move to the next slide, we just wanted to highlight, in terms of online costs, of Blanket.

Ross Jerrard: We just wanted to highlight in terms of on-mine costs at Blanket, and I think it is very important to pull out a few key, I guess, transactions or cost centers. The first one is salaries and wages. These have stayed broadly in line, and you can see a 4% movement year to date in terms of base increases in terms of salaries and wages. So well managed and we are very happy in terms of that overall cost center. What has moved, however, is the Blanket Employee Trust distribution. So previously we have had the facilitation loans. So any distributions that are made from Blanket dividends, have gone to offset, or a portion of them have gone to offset those facilitation loans, and those have now been paid off.

Speaker #1: And I think it's very important to pull out a few key, I guess, transactions or cost centers. The first one is salaries and wages.

Speaker #1: These have stayed broadly in line and you can see a 4% movement year to date in terms of base increases in terms of salaries and wages.

Ross Jerrard: These have stayed broadly in line, and you can see a 4% movement year to date in terms of base increases in terms of salaries and wages. So well managed and we are very happy in terms of that overall cost center. What has moved, however, is the Blanket Employee Trust distribution. So previously we have had the facilitation loans. So any distributions that are made from Blanket dividends, have gone to offset, or a portion of them have gone to offset those facilitation loans, and those have now been paid off. Under IFRS, any distributions that are now made under that arrangement need to be classified as employee costs and sit within production costs. So you will see a big significant $3.2 million charge going through in this last quarter, which has significantly moved our production costs.

Speaker #1: So, well managed, and we're very happy in terms of that overall cost center. What has moved, however, is the blanket employee trust distribution. So, previously we've had the facilitation loan.

Speaker #1: So any distributions that are made from Blanket dividends have gone to offset, or a portion of them have gone to offset, those facilitation loans.

Speaker #1: And those have now been paid off. And then, under IFRS, any distributions that are now made under that arrangement need to be classified as employee costs and sit within production costs.

Ross Jerrard: Under IFRS, any distributions that are now made under that arrangement need to be classified as employee costs and sit within production costs. So you will see a big significant $3.2 million charge going through in this last quarter, which has significantly moved our production costs. It has not changed any distributions or anything, and is actually a reflection of a great operation in terms of distributing funds. But unfortunately, it sits within our mine costs and has had quite a material impact and will continue to have a material impact in terms of the optics as we go forward. So, that is a stand-alone item. We will be reporting it separately, so everybody will be able to see that and deal with that specific cost or line item independently. The other big movement for the period was the electricity cost, where you will see that has gone up 25%.

Speaker #1: So you'll see a significant $3.2 million charge going through in this last quarter, which has significantly moved our production costs. It hasn't changed any distributions or anything, and is actually a reflection of a great operation in terms of distributing funds.

Ross Jerrard: It has not changed any distributions or anything, and is actually a reflection of a great operation in terms of distributing funds. But unfortunately, it sits within our mine costs and has had quite a material impact and will continue to have a material impact in terms of the optics as we go forward. So, that is a stand-alone item. We will be reporting it separately, so everybody will be able to see that and deal with that specific cost or line item independently. The other big movement for the period was the electricity cost, where you will see that has gone up 25%. This is in fact driven by increased weeding charges, but our actual consumption has decreased. So again, something that is largely outside of our control, where we have done well in terms of our consumption of electricity, but we have been hit with some increased charges there.

Speaker #1: But unfortunately, it sits within our mine costs and has had quite a material impact, and will continue to have a material impact in terms of the optics as we go forward.

Speaker #1: So, that is a standalone item. We will be reporting it separately, so everybody will be able to see that and deal with that specific cost or line item independently.

Speaker #1: And the other big movement for the period was the electricity cost, where you'll see that's gone up 25%. This is, in fact, driven by increased wheeling charges, but our actual consumption has decreased.

Ross Jerrard: This is in fact driven by increased weeding charges, but our actual consumption has decreased. So again, something that is largely outside of our control, where we have done well in terms of our consumption of electricity, but we have been hit with some increased charges there. So again, another one-off that has hit us in terms of those cost centers. Largely when you back out those areas, you look at the performance in terms of where we've exited the six-month period, it's really driven by lower grades. So those reduced ounces that have come through, in terms of production, has really hit us in terms of our unit metrics when you look at that on-mine cost metric and at the bottom right of the chart going up some 46% for the period.

Speaker #1: So again, something that's largely outside of our control where we've done well in terms of our consumption of electricity but we've been hit with some increased charges there.

Ross Jerrard: So again, another one-off that has hit us in terms of those cost centers. Largely when you back out those areas, you look at the performance in terms of where we've exited the six-month period, it's really driven by lower grades. So those reduced ounces that have come through, in terms of production, has really hit us in terms of our unit metrics when you look at that on-mine cost metric and at the bottom right of the chart going up some 46% for the period. As that flows through onto the next slide, in terms of our all-in sustaining costs, you'll see that the higher on-mine costs that I've just discussed, together with the higher royalty driven by that higher revenue that I mentioned at the start, has really flowed through in terms of our calculation of all-in sustaining costs.

Speaker #1: So again, another one-off that has hit us in terms of those cost centers. So largely, when you back out those areas and look at the performance in terms of where we've exited the six-month period, it's really driven by lower grades.

Speaker #1: So those reduced ounces that have come through in terms of production has really pit us in terms of our unit metrics when you look at that online cost metric and at the bottom right of the chart going up some 46% for the period.

Speaker #1: As that flows through onto the next slide, in terms of our all-in sustaining costs, you'll see that the higher online costs that I've just discussed, together with the higher royalty driven by that higher revenue that I mentioned at the start, have really flowed through in terms of our calculation of all-in sustaining costs.

Ross Jerrard: As that flows through onto the next slide, in terms of our all-in sustaining costs, you'll see that the higher on-mine costs that I've just discussed, together with the higher royalty driven by that higher revenue that I mentioned at the start, has really flowed through in terms of our calculation of all-in sustaining costs. Whilst our capital expenditure has been well managed and in line with expectation, those costs of the debt distribution, the higher royalties and some higher administrative expenses, largely driven by those advisor fees and transaction fees for our funding strategy, have all fallen into that all-in sustaining bucket and driven that increase in terms of our overall costs. What does that mean? If we move to the next slide, we have had a look and done a whole six plus six exercise and looked at our outlook for the end of the year.

Speaker #1: Whilst our capital expenditure has been well managed and in line with expectation, those costs of the best distribution, the higher royalties, and some higher administrative expenses—largely driven by those advisor fees and transaction fees for our funding strategy—have all fallen into that all-in sustaining bucket.

Ross Jerrard: Whilst our capital expenditure has been well managed and in line with expectation, those costs of the debt distribution, the higher royalties and some higher administrative expenses, largely driven by those advisor fees and transaction fees for our funding strategy, have all fallen into that all-in sustaining bucket and driven that increase in terms of our overall costs. What does that mean? If we move to the next slide, we have had a look and done a whole six plus six exercise and looked at our outlook for the end of the year. It has meant with those cost increases and the classifications as we look towards the end of the year, we've increased our on-mine cash costs per ounce sold, increasing that by $100 from our previous guidance range. So the updated guidance range is $1,600 to $1,800. So the 6% increase.

Speaker #1: And driven that increase in terms of our overall costs. So what does that mean? If we move to the next slide, we have had a look and done a whole 6 plus 6 exercise and looked at our outlook for the end of the year.

Speaker #1: And it has meant, with those cost increases and the classifications, as we've looked towards the end of the year, we've increased our online cash costs per ounce sold, increasing that by $100 from our previous guidance range.

Ross Jerrard: It has meant with those cost increases and the classifications as we look towards the end of the year, we've increased our on-mine cash costs per ounce sold, increasing that by $100 from our previous guidance range. So the updated guidance range is $1,600 to $1,800. So the 6% increase. And our all-in sustaining cost per ounce sold has increased by some $400, up from $2,100 per ounce to $2,500 an ounce at the lower end, and increasing to $2,700 an ounce at the top end of the guidance range. Those are due to the new factors I've just discussed. But we've also introduced some new additional spend, which is indicated in the table below. And that's really around how we expect some of the CapEx to drop this year.

Speaker #1: So the updated guidance range is $1,600 to $1,800. So the 6% increase. And our all-in sustaining costs per ounce sold has increased by some $400 up from $2,100 per ounce to $2,500 an ounce per lower end.

Ross Jerrard: And our all-in sustaining cost per ounce sold has increased by some $400, up from $2,100 per ounce to $2,500 an ounce at the lower end, and increasing to $2,700 an ounce at the top end of the guidance range. Those are due to the new factors I've just discussed. But we've also introduced some new additional spend, which is indicated in the table below. And that's really around how we expect some of the CapEx to drop this year. So we'd previously announced in March that there was 133 kV power line project that had been approved by the board, but we hadn't done our costing and quotes, which has now come through subsequent to that announcement. And of the $14.2 million, $8.1 million is going to drop in 2026.

Speaker #1: And increasing to $2,700 an ounce at the top end of the guidance range. Those are due to the factors I've just discussed, but we've also introduced some new additional spend, which is indicated in the table below.

Speaker #1: And that's really around how we expect some of the capex to drop this year. So we'd previously announced in March that there was a 133 kV power line project that had been approved by the board.

Ross Jerrard: So we'd previously announced in March that there was 133 kV power line project that had been approved by the board, but we hadn't done our costing and quotes, which has now come through subsequent to that announcement. And of the $14.2 million, $8.1 million is going to drop in 2026. So we've included that in the guidance, together with an updated number for our AC/DC configuration, our Central Shaft drop winder project at $3.1 million. And there's also some additional spend in terms of key projects that we do need to deliver. One of them is the housing project, which is fundamental to our core operating activities, which we've included a further $1.3 million.

Speaker #1: But we hadn't done our costing and quotes, which have now come through subsequent to that announcement. And of the $14.2 million, $8.1 million is going to drop in 2026.

Speaker #1: So we've included that in the guidance, together with an updated number for our AC/DC configuration—our central shaft drop windup project at $3.1 million.

Ross Jerrard: So we've included that in the guidance, together with an updated number for our AC/DC configuration, our Central Shaft drop winder project at $3.1 million. And there's also some additional spend in terms of key projects that we do need to deliver. One of them is the housing project, which is fundamental to our core operating activities, which we've included a further $1.3 million. And there's some exciting projects that I'll leave Craig to discuss in terms of K-Pits and Luwanchira and our underground development, which again, are key additional spends that we need to deploy in terms of meeting our objectives. I just wanted to talk a little bit more about the CapEx profile. So if we move to the next slide, you'll see a breakdown in terms of what had previously been guided in terms of CapEx spend against with each particular project.

Speaker #1: And there's also some additional spend in terms of key projects that we do need to deliver. One of them is the housing project which has fundamental to our core operating activities which we've included a further 1.3 million dollars.

Speaker #1: And there are some exciting projects that I'll leave Craig to discuss in terms of Cape. It's a lever, and our underground development, which again are key additional spends that we need to deploy in terms of meeting our objectives.

Ross Jerrard: And there's some exciting projects that I'll leave Craig to discuss in terms of K-Pits and Luwanchira and our underground development, which again, are key additional spends that we need to deploy in terms of meeting our objectives. I just wanted to talk a little bit more about the CapEx profile. So if we move to the next slide, you'll see a breakdown in terms of what had previously been guided in terms of CapEx spend against with each particular project.

Speaker #1: I just wanted to talk a little bit more about the capex profile. So, if we move to the next slide, you'll see a breakdown in terms of what had previously been guided in terms of capex spend against each particular project.

Speaker #1: So, our previous guidance in terms of sustaining capital expenditure was $26.6 million. Introducing the three new initiatives, which you can see indicated by reference B and E—it's the new power line, the ACD conversion, and the Cape Hits project—which pushes that capex profile up to $48 million.

Ross Jerrard: Our previous guidance in terms of sustaining capital expenditure was $26.6 million. Introducing the three new initiatives, which as you can see, indicated by reference D and E, it is the new power line, the AC/DC conversion, and the K-Pits project, which pushes that CapEx profile up to $48 million. We have also got updates in terms of our growth capital expenditure. Again, going through our Bilboes development and now having quotes coming through and a better understanding in terms of our, I guess, our deposit requirements, where previously we had factored in that a large deployment of cash was needed upfront in terms of ordering those long lead items. We have got better financing terms. A lot of that cash has reduced, and we have been able to actually go with deposits and defer some of that cash into the early part of next year.

Speaker #1: But we've also got updates in terms of our growth capital expenditure. And again, going through our billboards development and now having quotes coming through, and a better understanding in terms of our, I guess, our deposit requirements, where previously we had factored in that a large deployment of cash was needed upfront in terms of ordering those long lead items.

Speaker #1: We've got better financing terms. A lot of that cash has been reduced, and we've been able to actually go with deposits and defer some of that cash into the early part of next year.

Speaker #1: So that billboards $132 million spend has now been reduced for 2026 to $48 million, with the $80-odd million being pushed into the first half of next year.

Ross Jerrard: That Bilboes $132 million spend has now been reduced for 2026 to $48 million, with the 80-odd million being pushed into the H1 of next year. We also have a new Blanket Mine plant upgrade, which is a new project of $3.5 million, which has been updated into the H2 of this year. Overall, our CapEx number has moved from $162 million down to $103 million, but a large portion of that is the Bilboes spend, which is really a reflection of timing. I will highlight it is not to do with the ability to finance or positioning in terms of the project. It will not delay the project, but it is just a wise or better use of deployment of funds and a very healthy update for us in terms of us moving forward. If we move to the next slide, please.

Speaker #1: And we also have a new Blanket Mine plant upgrade, which is a new project of $3.5 million, which is being updated into the second half of this year.

Speaker #1: So overall, our capex number has moved from $162 million down to $103 million. But a large portion of that is the billboard spend, which is really a reflection of timing.

Speaker #1: I will highlight it's not to do with the ability to finance, or positioning in terms of the project. It won't delay the project, but it's just a wiser or better use of deployment of funds and has been a very healthy update for us in terms of us moving forward.

Speaker #1: So if we move to the next slide, please. As mentioned earlier, we do have quite significant movement in our P&L in terms of the accounting for convertible notes.

Ross Jerrard: As mentioned earlier, we do have quite a significant movement in our P&L in terms of the accounting for convertible notes. We are not proposing to go into chapter and verse in terms of the accounting, but it is just to highlight that we have some significant movement with these convertible notes. It is driven by IFRS. We have independent valuations done, and it is just to remind everybody that we have a split in terms of the accounting for the transaction, where we have a host debt on one side of the senior notes, which is really treated in the amortized cost basis, and we have an embedded derivative, which is a financial liability on the other side of the transaction, which moves with fair value accounting. It does cause some quite considerable volatility through the P&L. It is fully disclosed.

Speaker #1: And we're not proposing to go into chapter and verse in terms of the accounting, but it's just to highlight that we have seen some significant movement with these convertible notes.

Speaker #1: It's driven by IFRS. We have independent valuations done. And just to remind everybody, we have a split in terms of the accounting for the transaction, where we have a host debt on one side of the senior notes, which is really treated on the amortized cost basis.

Speaker #1: And we have an embedded derivative, which is a financial liability on the other side of the transaction, which moves with fair value accounting. It does cause some quite considerable volatility through the P&L.

Speaker #1: It's fully disclosed. We are across it in terms of where we sit, and I'm happy to take a deep dive as we account for it for anybody on the call.

Ross Jerrard: We are across it in terms of where we sit, and I am happy to take a deep dive as we account for it for anybody on the call. I am not proposing to go through each stage now, but just to flag that to your attention that you will see some quite significant movements, and we will keep everybody briefed in terms of how that is accounted for. The last slide is really to remind everybody that we had the capped call option that was also associated with the con notes. If we just move to the last slide, please. The accounting for the capped call is another derivative financial asset, which is also fair value through the profit or loss and provides some volatility and net worth.

Speaker #1: I'm not proposing to go through each stage now, but I just wanted to flag that to your attention. You'll see some quite significant movements.

Speaker #1: And we'll keep everybody briefed in terms of how that is accounted for. And the last slide is really to remind everybody that we had the cap call option that was also associated with the con night.

Speaker #1: So, if we could just move to the last slide, please. The accounting for the cap call is another derivative financial asset, which is also fair value through profit and loss.

Speaker #1: And provide some volatility in networks. So it does have an impact on the income statement, as those fair values are recognized in the income statement each reporting period.

Ross Jerrard: It does have an impact on the income statement as those fair values are recognized in the income statement each reporting period. Again, third-party valuations coming up with the numbers are fully disclosed and does provide some quite significant movements, as you can see, in terms of original cost at $14.4 million and the various fair value movements as we sit and carry a net position of $4.4 million on the balance sheet at the end of the period. Again, happy to take a deep dive and explain that more fully for anybody who would like a bit more detail on that. With that, I will hand across to Victor Gapare, who will talk us through the Bilboes update.

Speaker #1: And again, a third-party valuation has come up with the numbers, which are fully disclosed and do provide some quite significant movements, as you can see, in terms of original cost at $14.4 million.

Speaker #1: And the various fair value movements, as we sit and carry a net position of $4.4 million on the balance sheet at the end of the period.

Speaker #1: But again, happy to take a deep dive and explain that more fully for anybody who would like a bit more detail on that. And with that, I will hand across to Victor, who will talk us through the billboards update.

Speaker #2: Thank you, Ross. Can we move to the next slide, please? Thank you very much. Basically, the message which we want to leave with you today is that Billboards continues to advance on schedule.

Victor Gapare: Thank you, Ross. Can we move to the next slide, please? Thank you very much. Basically, the message which we want to leave with you today is that Bilboes continues to advance on schedule and remains central to Caledonia Mining's strategy to deliver sustainable long-term growth. What we have seen is that we have done quite some considerable work across various work streams, especially financing, engineering, and development during this last quarter. We completed geotechnical investigations for the process plant site. That also includes the tailing storage facility. We have advanced process plant optimization studies. We are almost done with that. We are moving on that. We have substantially completed the tender processes and procurement for long lead items. Here we are talking about the milling plant, really the processing plant, some items of the processing plant, and the major earthworks on site. This is going ahead. We have continued to engage with prospective financing providers.

Speaker #2: It remains central to Caledonia's strategy to deliver sustainable, long-term growth. What we have seen is that we've done quite some considerable work across various workstreams, especially financing, engineering, and development during this last quarter.

Speaker #2: We completed geotechnical investigations for the process plant site, which also includes the tailings storage facility. We've advanced process plant optimization studies and we're almost done with that.

Speaker #2: We're moving on that. We've substantially completed the tender processes and procurement for long-lead items. Here we're talking about the milling plant, really the processing plant—some items of the processing plant—and the major earthworks on site.

Speaker #2: So, this is going ahead. We've continued to engage with prospective financing providers. Ross will be back in a slide or two to just tell you where we are with that.

Victor Gapare: This is going ahead. We have continued to engage with prospective financing providers. Ross will be back in a slide or two to just tell you where we are with that. Basically, what we are seeing is that quite a lot of progress is being made on this project. In terms of people moving on site, we expect the first contractors to be on site around October. We already have accommodation, but we are also starting additional work on accommodation facilities during October. Can we move to the next slide? As far as capital expenditure is concerned, Ross Jerrard has already explained a few of the items. Year to date, we have spent $3.5 million against a budget of $8.3 million. This is really expenditure on the owner's team.

Victor Gapare: Ross Jerrard will be back in a slide or two to just tell you where we are with that. Basically, what we are seeing is that quite a lot of progress is being made on this project. In terms of people moving on site, we expect the first contractors to be on site around October. We already have accommodation, but we are also starting additional work on accommodation facilities during October. Can we move to the next slide? As far as capital expenditure is concerned, Ross Jerrard has already explained a few of the items. Year to date, we have spent $3.5 million against a budget of $8.3 million. This is really expenditure on the owner's team. We have recruited the team which will build this mine, our own team, which will be working with our EPCM contractor, DRA Africa.

Speaker #2: But basically, what we're seeing is that quite a lot of progress is being made on this project. In terms of people moving on site, we expect the first contractors to be on site around October.

Speaker #2: And we already have accommodation, but we are also starting additional work on accommodation facilities during October. Can we move to the next slide? As far as capital expenditures are concerned, Ross has already explained a few of the items here. To date, we have spent $3.5 million against the budget of $8.3 million.

Speaker #2: This is really expenditure on the owner's team. We have recruited the team which will build this mine—our own team, which will be working with our EPCM contractor, DRA Africa.

Victor Gapare: We have recruited the team which will build this mine, our own team, which will be working with our EPCM contractor, DRA Africa. That cost of that team, plus also the early work, which really at the beginning of the project is always the front-end engineering design work, which allows you to place orders for equipment. That is where we have been spending money, really. The forecast for 2026, as Ross Jerrard has said, is $48 million compared to the $132 million which we had on the budget. As Ross Jerrard again explains, this is really a timing issue. We have now gone out to tender. We have received firm offers, firm tenders from the various tenderers with our payment terms, and a lot of those require us to pay a deposit and then the balance of the costs will be paid as contractual milestones are reached.

Speaker #2: So, that cost of that team, plus also the early work, which really at the beginning of the project is always the front-end engineering design work, which allows you to place orders for equipment.

Victor Gapare: That cost of that team, plus also the early work, which really at the beginning of the project is always the front-end engineering design work, which allows you to place orders for equipment. That is where we have been spending money, really. The forecast for 2026, as Ross Jerrard has said, is $48 million compared to the $132 million which we had on the budget. As Ross Jerrard again explains, this is really a timing issue. We have now gone out to tender. We have received firm offers, firm tenders from the various tenderers with our payment terms, and a lot of those require us to pay a deposit and then the balance of the costs will be paid as contractual milestones are reached. There is really no change in the project timetable, the cost or scope at this stage. Can we move on?

Speaker #2: So that's where we've been spending money, really. The focus for 2026, as Ross has said, is $48 million, compared to the $132 million which we had on the budget.

Speaker #2: As Ross again explained, this is really a timing issue. We've now gone out to tender. We've received same offers same tenders from the various tenderers.

Speaker #2: With payment terms, and a lot of those require a deposit to be paid, with the balance of the costs paid as contractual milestones are reached.

Speaker #2: There's really no change in the project timetable. The cost forecast at this stage—can we move on? The economic analysis: we've highlighted the economic analysis of this project over time.

Victor Gapare: There is really no change in the project timetable, the cost or scope at this stage. Can we move on? The economic analysis, we have highlighted the economic analysis of this project over time, and it still is a very robust project for this company, and this will stand us in good stead in years to come. Can we go to the next slide, please? As far as the funding strategy for the project is concerned, Ross, can you take this on?

Victor Gapare: The economic analysis, we have highlighted the economic analysis of this project over time, and it still is a very robust project for this company, and this will stand us in good stead in years to come. Can we go to the next slide, please? As far as the funding strategy for the project is concerned, Ross, can you take this on?

Speaker #2: And it still continues to—it still is a very robust project for this company, and this will stand us in good stead in years to come.

Speaker #2: Can we go to the next slide, please? As far as the funding strategy for the project is concerned, Ross, can you take this on?

Speaker #3: Thank you, Victor. We're delighted to provide an update on the funding strategy. You'll see the four pillars that we've previously highlighted as part of our step process.

Ross Jerrard: Thank you, Victor. We are delighted in terms of providing an update on the funding strategy. You will see the four pillars that we have previously highlighted in terms of our step process, providing the hedge program, doing the convertible, and then have an interim funding facility while we position the project finance facility. The first two steps as highlighted on the chart have been delivered. It was important that we put that gold price hedging in place, and that basically hedged our position over the construction period, but provided a floor that supported the cash flows as we went through our discussions with the various banking institutions. You would have seen the delivery of the successful convertible note offering. Again, oversubscribed and really delivered a great outcome in terms of treasury and positioning us well in terms of our funding initiatives.

Speaker #3: Providing the hedge program, doing the convertible, and then having an interim funding facility while we're positioning the project finance facility. So, the first two steps, as highlighted on the chart, have been delivered.

Speaker #3: It was important that we put that gold price hedging in place, and that basically hedged our position over the construction period, but provided a floor that supported the cash flows as we went through our discussions with the various banking institutions.

Speaker #3: We would have seen the delivery of the successful convertible note offering, again oversubscribed and ready to deliver a great outcome in terms of treasury and positioning, as well as in terms of our funding initiatives.

Speaker #3: Those two pillars really meant that we've been able to advance with our banking syndications. The first being the interim funding facility—we've just come off the back of two weeks of bank visits, both with the interim funders and also the project funding institutions.

Ross Jerrard: Those two pillars really meant that we have been able to advance with our banking syndications, the first being the interim funding facility. We have just come off the back of two weeks of bank visits, both with the interim funders and also the project funding institutions, where we had very good due diligence, excuse me, site visits with those institutions across our assets. In terms of our interim funding facility, we have got credit approval from our two co-leader arrangers, and we are working with other syndicate banks in terms of getting that USD 150 million facility in place. We are well down the track. We are going through all the final DD positions, and we hope that we are planning for that to be closed in late August, early September. So well-positioned in terms of that work stream. In parallel, we have been working with our project finance banks, and again, that process is well underway.

Speaker #3: We had very good due diligence—excuse me—site visits with those institutions across our assets. In terms of our interim funding facility, we've got credit approval from our two co-lead arrangers, and we're working with other syndicate banks in terms of getting that $150 million facility in place.

Speaker #3: We're well down the track. We're going through all the final DD positions, and we hope that we're planning for that to be closed in late August or early September.

Speaker #3: So, we're well positioned in terms of that workstream. In parallel, we've been working with our project finance banks, and again, that process is well underway.

Speaker #3: We've been very excited in terms of both the appetite and the reaction from those banks. And as I mentioned, we've just come off a good visit to Zimbabwe.

Ross Jerrard: We have been very excited in terms of both the appetite and the reaction from those banks. As I mentioned, we have just come off a good visit to Zimbabwe, visiting both government, the assets, and the various management teams in country. So that is running parallel. We previously indicated in terms of timelines that we felt that it was a little bit further out. So over the next 12 months, we thought that we could deliver that. But off the back of the work streams and how much advancing, we are certainly planning for that to be closed by the end of the year or early into next year. So over the next to nine months maximum. But we are delighted with the progress and we are well positioned in terms of the various discussions that we have at play.

Speaker #3: We're visiting both the government, the assets, and the various management teams in the country, so that's running in parallel. We'd previously indicated, in terms of timelines, that we felt it was a little bit further out.

Speaker #3: So, over the next 12 months, we thought that we could deliver that. But off the back of the workstreams and how they're advancing, we're certainly planning for that to be closed by the end of the year or early into next year.

Speaker #3: So, over the next two to nine months maximum. But we're delighted with the progress, and we're well positioned in terms of the various discussions that we have at play.

Speaker #3: If we move to the next slide, we just wanted to give you a quick update in terms of that total funding requirement. So this is an update to the previous slide that we've used in previous updates.

Ross Jerrard: If we move to the next slide, we just wanted to give you a quick update in terms of that total funding requirement. This is an update to a previous slide that we've done in previous updates. On the right, you'll see the use of funds and I guess the deployment that we're looking for with the capital cost that including interest and working capital, looking for the better part of USD 600 million of funding. Using that USD 3,500 per ounce pricing that we've done in terms of our hedging facility, you can see the breakdown of our cash on hand that we now have at 30 June of USD 172 million. Our forecast cash flows from Blanket Mine being USD 115 million. Therefore, we're looking for best part of USD 300 million, just over USD 300 million in terms of senior debt to other facilities to meet that funding requirement.

Speaker #3: On the right, you'll see the use of funds. And I guess the deployment that we're looking for, with a capital cost but including interest and working capital, is looking for the better part of $600 million.

Speaker #3: Of funding. Using that three and a half thousand dollar per ounce pricing that we've done in terms of our hedging facility. You can see the breakdown of our cash on hand that we now have at the 30th of June of 172 million dollars.

Speaker #3: Our forecast cash flows from Blanket are $115 million. And therefore, we're looking for the best part of $300 million—just over $300 million—in terms of senior debt and other facilities to meet that funding requirement.

Speaker #3: If we look at the middle chart, and we've done that slicing at a price deck of $4,000 per ounce, you can see in terms of where that sits, and moving that up slightly, it certainly reduces our senior debt facility down closer to around $263 million.

Ross Jerrard: If we look at the middle chart, we've done that slicing at a price deck of USD 4,000 per ounce. You can see in terms of where that sits and moving that up slightly, it certainly reduces our senior debt facility down closer to the order of USD 263 odd million. Both charts, we believe, totally achievable. I think we're well on track in terms of our funding work streams, and we're excited about the coming months in terms of making sure that those are closed out and we can really focus on delivering the project. With that, I will hand it across to Craig Harvey.

Speaker #3: So, both charts we believe are totally achievable. I think we're well on track in terms of our funding workstreams, and we're excited about the coming months in terms of making sure that those are closed out and we can really focus on delivering the project.

Speaker #3: And with that, I will hand it over to Craig Harvey.

Craig Harvey: Good afternoon, all. I'll take you through some of the exploration highlights that we've been encountering at Caledonia Mining.

Speaker #1: Good afternoon all. I'll take you through some of the exploration highlights that we've been encountering at Caledonia. So I think throughout of the throughout the finance and through some of the CEO's remarks, we you know you've heard the term CAPEX.

Craig Harvey: I think throughout the finance and through some of the CEO's remarks, you've heard the term K-Pits. What is the K-Pits? The K-Pits is an area situated inside the Blanket Mine mining lease area. During this period under review, or basically the last six months, we did over 2,000 meters of surface trenching. We did 7,000 meters of reverse circulation drilling. Shallow holes, only down to about a depth of about 40 meters, purely to have a look at oxide mineralization potential. What you can see there on the selected drill highlights on the right, we've got oxide grades ranging between 1.5 and 2.5 grams per tonne, over drill hole lengths. Those are drill hole lengths between 15 and call it 25 meters. But these are within 40 meters of surface.

Speaker #1: So what is the CAPEX? The CAPEX is an area situated inside the Blanket mining lease area. During this period under review, or basically the last six months, we did over 2,000 meters of surface trenching. We did 7,000 meters of reverse circulation drilling—shallow holes only, down to about a depth of 40 meters.

Speaker #1: Purely to have a look at oxide or to have a look at oxide mineralization potential. So what you can see there on the selected drill highlights on the right, we've you know we've got oxide grades ranging between one and a half and two and a half grams per ton.

Speaker #1: Over drill lengths—those are drill lengths between 15 and, call it, 25 meters. But these are within 40 meters of surface. Below that, pleased to see that the mineralization continues.

Craig Harvey: Below that, pleased to see that the mineralization continues, and very pleased to see what the sulfide grades actually look like as well. We are talking grades of 6 grams a tonne, over downhole widths of between 7 and 16 meters, all within 40 meters of surface. What we are currently doing is, quite clearly, we have completed our drilling exercise. We are drawing up a resource statement. We are doing metallurgical testing in terms of column testing, various sizes, various heights. We are currently constructing a small heap leach trial test pit to actually test it under conditions similar to what the column tests are, so we can gauge that it is actually working. Results to date are encouraging. I obviously cannot say anything yet. One of the things that I just want to touch on is kind of those bottom three points. Why this discovery matters?

Speaker #1: And very pleased to see what the sulphide grades actually look like as well. So, I mean we're talking grades of 6 grams a ton overall, with some between 7 and 16 meters.

Speaker #1: All within 40 meters of surface. So what we’re currently doing is, quite clearly, we have completed our drilling exercise and we are drawing up a resource statement.

Speaker #1: We are doing metallurgical testing in the term, in terms of column testing—various sizes, various heights. We are currently constructing a small heap leach trial test bed to actually test it under conditions similar to what the column tests are.

Speaker #1: So we can gauge that it's actually working. Results to date are encouraging, but obviously we can't say anything yet. One of the things that I just want to touch on is kind of those bottom three points.

Speaker #1: Why does this discovery matter? Well, I think for anybody that knows Blanket Mine, you know there was a whole lot of investment in Central Shaft.

Craig Harvey: Well, I think for anybody that knows Blanket Mine, there was a whole lot of investment in Central Shaft. We can currently hoist and mine a lot more than what we can mill. Hence, there are some tweaks coming up to the plant in the near future. But still, this is as an external heap leach source. Anything that we do here clearly does not need the actual Blanket main plant. That is just for the oxide material. Where the zone is situated. It is situated about 200 meters to the east of the closest known ore body that we are mining in the underground section of Blanket. We are currently in the process of laying out some surface drill holes to drill below this area now.

Speaker #1: We can currently hoist and mine a lot more than what we can mill. Hence, there are some tweaks coming up to the plant in the near future.

Speaker #1: But still, this is an external heat bleach source. Anything that we do here clearly does not need the actual blanket main plant. So that's just for the oxide material.

Speaker #1: Where the zone is situated, it's about 200 meters to the east of the closest known ore body that we're mining in the underground section of Blanket.

Speaker #1: We are currently in the process of laying out some surface drill holes to drill below this area now. We're also looking at drilling from mine level at our shaft, which is about 200 meters below surface, to have a look at this area.

Craig Harvey: We are also looking at drilling from mine level at our Sheet Shaft, which is about 200 meters below surface, to have a look for this area. Quite clearly, 200 meters vertical at quite a fat surface expression of the ore body at sulfide grades like that, it just opens up another whole opportunity. I think I have said it on this call before. One of the things that people that know Blanket should notice is that when you arrive at Blanket, you only see headgear. You do not see open pits. At Bilboes, you see open pits. You do not see headgear. This zone represents only a small portion of ground that we have rights to in terms of the mining license and in terms of our claim areas.

Speaker #1: Now, quite clearly, you know, 200 meters vertical and quite a fat surface expression of the ore body at sulfide grades like that, you know, just opens up another whole opportunity.

Speaker #1: And I think I've said it on this call before. So, one of the things that people who know Blanket should notice is that when you arrive at Blanket, you only see headgear.

Speaker #1: You don't see open pits. Now, at Bulbos, you see open pits. You don't see headgear. So this zone represents only a small portion of the ground that we have rights to, in terms of the mining license and in terms of our claim areas.

Speaker #1: And in the coming years, this is going to be the model that we're going to follow, and it's going to be the first of many.

Craig Harvey: In the coming years, this is going to be the model that we are going to follow, and it is going to be the first of many, I am pretty sure of that. If you could move on to the next slide. It is just going to be a recap of Blanket underground. I have just highlighted two intersections in red at the bottom there, the 2409 and the 2408 drill holes. Reminding that it is approximately 280 meters below 34 level, which is our deepest mining level at the moment. That represents four main mining levels. We are currently in the process, we are busy dotting the I's and crossing the T's on a Blanket Mine mineral resource update, which will include surface. You will see the CapEx numbers there. If you can go on to the next slide.

Speaker #1: I'm pretty sure of that. So, if you could move on to the next slide, it's just going to be a recap of Blanket underground.

Speaker #1: I just highlighted two intersections in red at the bottom there: the 2409 and the 2408 drill holes. Reminding that it's approximately 280 meters below 34 Level, which is our deepest mining level at the moment.

Speaker #1: That represents four main mining levels. So we are currently in the process, you know, we're busy dotting I's and crossing the T's on a Blanket Mine mineral resource update, which will include surface.

Speaker #1: So you'll see the CAPEX numbers there. If you can go on to the next slide. And just to highlight that those holes right right at the bottom 280 meters below our current deepest mining still have widths still have ore body widths of 15 to 30 meters at grades of two and a half to two and a half there.

Craig Harvey: And just to highlight that those holes right at the bottom, 280 meters below our current deepest mining, still have ore body widths of 15 to 30 meters at grades of 2.5 to 2.5. But if you take selected core zones, sort of the mineable zones, we are talking 8 meters wide still at anywhere between 3 and 5 grams per tonne. That is very much what we are currently mining in and around 34 level. The takeaway here is that going deeper at Blanket, we are not seeing the ore bodies getting thinner, disappearing, grades dropping, or anything like it. In actual fact, we are finding Blanket Seven, a new zone which we have not known before. Way up on the top, at the K-Pits, there is a potential new zone.

Speaker #1: But if you take selected core zones—my sort of the mineable zones—we're talking eight meters wide, still at anywhere between three and five grams per ton.

Speaker #1: That is very much what we are currently mining in and around 34 Level. So, the takeaway here is that, going deeper at Blanket, we aren't seeing the ore bodies getting thinner, disappearing, grades dropping, or anything like that.

Speaker #1: In actual fact, we are finding Blanket seven—a new zone which we haven't known before. Way up on the top at the capex, there's a potential new zone.

Speaker #1: So the old lady term blanket is very, very far from sort of rolling over and playing dead. There's a lot yet to come. If you can go on to the next section, which you'll just deal with the topper quickly.

Craig Harvey: The old lady term Blanket is very far from sort of rolling over and playing dead. There is a lot yet to come. If you can go on to the next section, which we will just deal with Motapa quickly. Again, dotting the I's and crossing the T's. The mineral resource estimate is done. We should be publishing the results of that in the next couple of weeks. It is only based on the drilling results that we did in 2024 and 2025. The 2026 exploration program is ongoing, proceeding very well. It is focusing more on the central and southern shear zone. At the same time, we are continuing trenching. It is proving to be a great exploration tool for us. We have identified some new areas that will come out in an exploration drilling or exploration results release later in the year.

Speaker #1: Again, dotting the i's and crossing the t's. The mineral resource estimate is done. We should be publishing the results of that in the next couple of weeks.

Speaker #1: It's only based—you know, it's only based on the drilling results that we did in 2024 and 2025. The 2026 exploration program is ongoing.

Speaker #1: Proceeding very well. It’s focusing more on the central and southern shear zone. At the same time, we are continuing trenching. It’s proving to be a great exploration tool for us.

Speaker #1: We have identified some new areas that will come out in an exploration drilling or exploration results release later in the year. But all these results are just underpinning Caledonia's view that the topper is going to feed into the Bulbos project.

Craig Harvey: But all these results are just underpinning Caledonia's view that Motapa is going to feed into the Bilboes project in some form or fashion, and we will continue doing the work. In a nutshell, it is looking good. With that, we will hand back to our CEO, Mark, to close out.

Speaker #1: In some form or fashion. And we will continue doing the work. So, in a nutshell, it's looking good. With that, we'll hand back to our CEO, Mark, to close out.

Speaker #2: Thank you, Craig. Look, we've covered a lot of ground. We're taking 45 minutes. So just to draw it all together, the immediate focus by which I mean between now and the end of the year is to get build on the success we've had at blanket in this quarter and get blanket running sweetly, increase production and improve the cash generation.

Mark Learmonth: Thank you, Craig. Look, we have covered a lot of ground. We have taken 45 minutes. Just to draw it all together, the immediate focus, by which I mean between now and the end of the year, is to build on the success we have had at Blanket in this quarter and get Blanket running sweetly, increase production, and improve the cash generation. Clearly, the big focus is Bilboes. Continue to get the funding in place and continue to deliver that project, targeting first production towards the end of 2028 and the first full year in 2029. Then as you have heard from Craig, we have got some very exciting further development and exploration opportunities, both at Blanket and at Motapa. Look, we have taken 45 minutes. If we could pause there and open it for questions, please.

Speaker #2: Clearly, the big focus is Bulbos – to continue to get the funding in place and to continue delivering on that project, targeting first production toward the end of 2028 and the first full year in 2029.

Speaker #2: And then, as you've heard from Craig, we've got some very exciting further developments and exploration opportunities, both at Blanket and at the Topper. So look, we've taken 45 minutes.

Speaker #2: If we could pause there and open it for questions, please.

Speaker #1: Thanks very much. If Kai could remind people: if you'd like to ask a question, please do so by raising your hand at the bottom of the screen.

Moderator: Thanks very much. If I could remind people, if you would like to ask a question, please do so by raising your hand in the bottom of the screen. We have got our first question from Nick Dinham. Nick, please go ahead. Nick, please go ahead when you are ready. Nick, if you are ready, you just unmute yourself.

Operator: Thanks very much. If I could remind people, if you would like to ask a question, please do so by raising your hand in the bottom of the screen. We have got our first question from Nick Dinham. Nick, please go ahead. Nick, please go ahead when you are ready. Nick, if you are ready, you just unmute yourself.

Speaker #1: We've got our first question. It is from Nick Dingham—Dingham, sorry. Nick, please go ahead. Nick, please go ahead when you're ready. Nick, if you're ready, just unmute yourself and then please go ahead.

Nick Dinham: Sorry. I am having some speaker issues here. Can you hear me now?

[Analyst 1]: Sorry. I am having some speaker issues here. Can you hear me now?

Speaker #2: Craig, I'm having some speaker issues here. Can you hear me now?

Speaker #1: Yes, we can hear you loud and clear, Nick.

Moderator: Yes, can hear you loud and clear, Nick.

Operator: Yes, can hear you loud and clear, Nick.

Speaker #2: Okay, great. All right. So, I'm very interested in a couple of questions here around this potential capacity expansion that arises on the mine as a result of the Conop.

Nick Dinham: Okay, great. All right, so I am very interested in a couple of questions here around this potential capacity expansion that arises on the mine as a result of the CONOPS. The first question would be, does 18% more blasts at the underground mine result in 18% more potential production, regardless of what happens to the mill?

[Analyst 1]: Okay, great. All right, so I am very interested in a couple of questions here around this potential capacity expansion that arises on the mine as a result of the CONOPS. The first question would be, does 18% more blasts at the underground mine result in 18% more potential production, regardless of what happens to the mill?

Speaker #2: So the first question would be: Does 18% more blasts in the underground mine result in 18% more potential production, regardless of what happens to the mole?

Mark Learmonth: It should do. Yeah, it is not currently running at 18% uplift in run-of-mine production because we are still opening up new areas. But in the fullness of time, yes, we would expect, as you said, that maths to work. Yeah.

Speaker #1: It should do. Yeah, I mean, it's not currently running at 18% uplift in run-of-mine production because we're still opening up new areas.

Speaker #1: But in the fullness of time, yes, we would expect, as you've said, for that math to work. Yeah.

Speaker #2: Okay, so it sounds like about a million tons a year.

Nick Dinham: Okay. It sounds like about 1 million tons a year.

[Analyst 1]: Okay. It sounds like about 1 million tons a year.

Speaker #1: Just a bit less. Just a little bit less. About 990. Yes.

Mark Learmonth: Just a bit less. Just a little bit less. About 990. Yes.

Speaker #2: Okay, so now coming on to the plant itself, there's been a discussion about a bore mole and a tons per hour figure given. There was also a discussion about potentially increasing the crushing.

Nick Dinham: Okay. Now coming on to the plant itself. There has been a discussion about a ball mill and a tons per hour figure given. There was also a discussion about potentially increasing the crushing. Now you are talking about elution circuits, and you are talking about 200 tons per day. But what is that when it comes to the annual production capabilities of the plant when all of this is bedded down?

[Analyst 1]: Okay. Now coming on to the plant itself. There has been a discussion about a ball mill and a tons per hour figure given. There was also a discussion about potentially increasing the crushing. Now you are talking about elution circuits, and you are talking about 200 tons per day. But what is that when it comes to the annual production capabilities of the plant when all of this is bedded down?

Speaker #2: Now you're talking about a Lucian circuit, and you're talking about 200 tons per day. But what is that when it comes to the annual production capabilities of the plant when all of this is bedded down?

Speaker #1: Well, that's exactly right. So we've got the 200 tons a day that we're going to be putting through Lima as a short-term, stopgap measure.

Mark Learmonth: Well, you are exactly right. The 200 tons a day that we are going to be putting through Lima is a short-term stopgap measure, okay? Just to start harvesting some of the increased run-of-mine production as soon as possible. Do not get distracted on that. What happens to Lima plant after we have upgraded the main No. 4 Shaft plant is another story. The elution upgrade is something we had planned to do anyway. That is a 3-ton elution vessel, which will come on stream at the end of this month. That just allows us to reprocess these grits, these activated carbon, which currently we are accumulating, and we cannot process. The new expenditure will be, at the front end, the crushers. We will be upgrading the crushers to, that will increase it to about 990,000 tons a year. We will be spending some money on those crushers.

Speaker #1: Okay, just to start harvesting some of the increased run of mine production as soon as possible. So don't get distracted on that. And then that will what happens to Lima plant after we've upgraded the main number four the main number four shaft plant is another story.

Speaker #1: The Illusion upgrade is something we plan to do anyway. So that's a three-ton Illusion vessel, which will come on stream at the end of this month.

Speaker #1: And that just allows us to reprocess these grits, these activated carbons, which currently we're accumulating and can't process. So, the new expenditure will be at the front end—the crushers.

Speaker #1: So we'll be upgrading the crushers as well. That will give us about 2,700—yeah, it'll increase it to about 990,000 tons a year.

Speaker #1: So, we'll be spending some money on those crushers. Then, at the back end, the CIL—we need to put another CIL tank in. This one will be about twice the size of the existing tanks.

Mark Learmonth: The back end, the CIL, we need to put another CIL tank in. This one will be about twice the size of the existing tanks, and that is so that we can keep the residence time at about 40 hours. Otherwise, we end up losing recovery. The ball mill, we put in a new ball mill, BM3, that was commissioned in June. We are just basically bookending it, upgrading the crushing of the front end and upgrading the CIL at the back end. That will cost about $3.5 million. The actual phasing of that, how that gets phased, that is something we need to work on between now and the end of the year.

Speaker #1: And that's so that we can keep the residence time at about 40 hours. Otherwise, we end up losing recovery. So, for the ball mill, we put in a new ball mill, BM3, that was commissioned in June.

Speaker #1: So we're just basically bookending it. Upgrading the crushing at the front end and upgrading the CIL at the back end. And that will cost about three and a half million dollars.

Speaker #1: The actual phasing of that, how that gets phased, that's something we need to work on between now and the end of the year. So at this stage, I can't tell you right now at what point all of that work will be implemented so that the main plant will be running at that sort of target rate of 90,000 tons a year.

Mark Learmonth: At this stage, I cannot tell you between right now at what point all of that work will be implemented so that the main plant will be running at that sort of target rate of 90,000 tons a year. I cannot answer that yet. We will do that by the end of the year. Also, when we have been through the full sort of procurement and budgeting exercise. What I cannot do, at this stage, I cannot tell you how that will convert into extra ounces in 2027, because at this stage, I do not know the exact timing of the implementation of the crusher and the CIL upgrades.

Speaker #1: I can't answer that yet. We'll do that by the end of the year, when we've also been through the full sort of procurement and budgeting exercise.

Speaker #1: So what I can't do is, at this stage, I can't tell you how that will convert into extra ounces in 2027 because, at this stage, I don't know the exact timing of the implementation of the crusher and the CIL upgrades.

Nick Dinham: Okay. Thank you. I would like to, the next question, to ask a little bit about the capital program. You have upgraded it to $48 million plus some growth CapEx in Blanket again. Yet to date, I can only find about $13 million have been spent in H1. This looks like quite a daunting task to spend the balance of the money, but you are obviously confident you can do it.

[Analyst 1]: Okay. Thank you. I would like to, the next question, to ask a little bit about the capital program. You have upgraded it to $48 million plus some growth CapEx in Blanket again. Yet to date, I can only find about $13 million have been spent in H1. This looks like quite a daunting task to spend the balance of the money, but you are obviously confident you can do it.

Speaker #2: Okay, thank you. I'd like the next question to be a little bit about the capital program—you've upgraded it to $48 billion, plus some growth capex in Blanket again.

Speaker #2: Yet, to date, I can only find that about $13 million has been spent in H1. So, this looks like quite a daunting task to spend the balance of the money.

Speaker #2: But you're obviously confident you can do it.

Speaker #1: Yeah. The spending isn't constrained by lack of funding. The spending has usually been constrained by slow delivery of materials. So I mean, case in point would be the ACDC conversion no, the Illusion plant the Illusion plant that we're working on at the moment, we found that deliveries of steel have been slower than we expected.

Mark Learmonth: Yeah. The spending is not constrained by lack of funding. The spending is usually constrained by slow delivery of materials. Case in point would be the AC/DC conversion. No, the Elution plant that we are working on at the moment. We found that deliveries of steel have been slower than we expected, and that is a fairly consistent theme across all of our capital projects. It is not a failure on our part in terms of our capacity. It is just the supply chain that gets a bit stretched. But yeah, we are comfortable we can get there.

Speaker #1: And that's a fairly consistent theme across all of our capital projects. It's not a failure on our part in terms of our capacity; it's just the supply chain that gets a bit stretched.

Speaker #1: But yes, we're comfortable we can get there.

Speaker #2: Okay, thank you. And just a little bit about the new power line that you're proposing. So, we heard about that previously, and you've changed the scheduling of that slightly.

Nick Dinham: Okay. Thank you. Just a little bit about the new power line that you are proposing. We heard about that previously. You changed the scheduling of that slightly. But I think-

[Analyst 1]: Okay. Thank you. Just a little bit about the new power line that you are proposing. We heard about that previously. You changed the scheduling of that slightly. But I think-

Speaker #2: But I think.

Speaker #1: Again, that's because of extraneous events. Things move slower in Zim than we'd like, especially when we're not altogether in control of the project. So, the 132 kV line that we're putting into Eagle Vulture requires extensive engagement with ZETDC, which can take longer than you'd like.

Mark Learmonth: Again, that is because of extraneous events. Things move slower in Zimbabwe than we would like, especially when we are not altogether in control of the project. The 132 kV line that we are putting into Eagles Vulture requires extensive engagement with ZETDC, which can take longer than you would like. But that should be in by about June next year.

Speaker #1: But that should be in by about June next year.

Speaker #2: Okay. So, the other question that was linked to that was that there were some question marks about how the pricing of power that would come through that line.

Nick Dinham: Okay. The other question that was linked to that was that there were some question marks about how the pricing of power that would come through that line. Obviously, you now expect this enhanced capacity of the plant and of the mine to be able, you will be able to create enough power from that or source enough power from that-

[Analyst 1]: Okay. The other question that was linked to that was that there were some question marks about how the pricing of power that would come through that line. Obviously, you now expect this enhanced capacity of the plant and of the mine to be able, you will be able to create enough power from that or source enough power from that-

Speaker #2: And obviously, you now expect this enhanced capacity at the plant and at the mine to mean you'll be able to generate enough power from that, or source enough power from that transmission line.

Mark Learmonth: Yeah

Nick Dinham: transmission line.

[Analyst 1]: transmission line.

Speaker #1: Correct. I mean, that's correct. We're currently—blanket is currently using more power than it's been allocated, and we can only get away with that for the time being.

Nick Dinham: Correct.

Mark Learmonth: Correct.

Nick Dinham: I mean, that-

[Analyst 1]: I mean, that-

Mark Learmonth: That is correct, because we are currently, Blanket is currently using more power than it has been allocated, and we can only get away with that for the time being for as long as the neighboring mine at Luwanchira is on care and maintenance. If Luwanchira came off care and maintenance, and I have got to say, I see no immediate prospect for that, we would struggle with the amount of power we can get through the existing 33 kV line. With the 132 kV line, that disappears completely. That constraint disappears completely.

Speaker #1: For as long as the neighboring mine at Vachico is on care and maintenance—if the Vachico came off care and maintenance, and I've got to say, I see no immediate prospect for that.

Speaker #1: We would struggle with the amount of power we can get through the existing 33 kV line. With the 132 kV line, that issue disappears completely.

Speaker #1: That constraint disappears completely.

Speaker #2: Have you settled your pricing now? Apparently, there's been a little bit of dispute between the various parties that entered into power supply agreements with you previously.

Nick Dinham: Have you settled your pricing now? Apparently, there has been a little bit of dispute between the various parties that entered into power supply agreements with you previously.

[Analyst 1]: Have you settled your pricing now? Apparently, there has been a little bit of dispute between the various parties that entered into power supply agreements with you previously.

Speaker #1: Yeah, there's a bit of a— I mean, Victor's closer to this than I am, but there is this thing called the Intensive Energy User Group in Zimbabwe.

Mark Learmonth: Yeah. There's a bit of a, I mean, Victor Gapare's closer to this than I am, but there is this thing called the Intensive Energy User Group in Zimbabwe, and there's also ZETDC. There seems to be a bit of a dispute between the two of them. We have incurred a higher wheeling charge, which has affected our electricity charge, as Ross Jerrard outlined. That's part of the play between ZESA and between ZETDC and IEUG. The power that we'd expect to come through the 132 kV line, we'd expect that to be somewhat cheaper than we're currently paying. Let's be clear, if we continue to face supply difficulties in country, we can do what I believe some of the other very big users do, I think the platinum producers, which is just import power directly ourselves.

Speaker #1: And there's also ZETDC. There seems to be a bit of a dispute between the two of them. We have incurred a higher wheeling charge, which has affected our electricity charge, as Ross outlined.

Speaker #1: That's part of the play between ZESA and ZETDC and IEUG. The power that we'd expect to come through the 132 kV line—we'd expect that to be somewhat cheaper than we're currently paying.

Speaker #1: And that's—to be clear—if we continue to face supply difficulties in-country, we can do what I believe some of the other very big users do.

Speaker #1: I think the Platinum Producers, we just report power directly ourselves. So the power tariff going forward with the 132 kV has not been finalized.

Mark Learmonth: The power tariff going forwards with the 132 kV has not been finalized, but there's no reason to suggest it will not be cheaper than it is at the moment.

Speaker #1: But there's no reason to suggest it will not be cheaper than it is at the moment.

Speaker #2: Okay, excellent. I have lots of questions, but I'll ask one more, I think, to close it off. You have interim funding lined up for two to three months' time.

Nick Dinham: Okay. Excellent. I have lots of questions, but I'll ask one more, I think, to close it off. You have interim funding lined up for two to three months' time. It almost sounds like from the rate of spending that you think of having to spend over the next period in Bilboes will actually be a lot less than you originally thought. Does this mean you can be a little more relaxed about the interim funding

[Analyst 1]: Okay. Excellent. I have lots of questions, but I'll ask one more, I think, to close it off. You have interim funding lined up for two to three months' time. It almost sounds like from the rate of spending that you think of having to spend over the next period in Bilboes will actually be a lot less than you originally thought. Does this mean you can be a little more relaxed about the interim funding

Speaker #2: It almost sounds like, from the rate of spending, that you think the amount you'll have to spend over the next period on billboards will actually be a lot less than you originally thought.

Speaker #2: Does this mean you can be a little more relaxed about the interim funding?

Speaker #1: No, we're still—no, we're still continuing. And especially, you work at Standard Bank. Standard Bank is one of the core components of that interim funding, that interim funding structure.

Mark Learmonth: No. We're still continuing. Especially, you work at Standard Bank. Standard Bank is one of the core components of that interim funding structure, and there is no way we're going to freewheel on getting that funding together. We will go flat out as quickly as we can to get all that funding in place, even if it means that we get it earlier than we need it. I mean, Ross Jerrard, do you want to? Ross Jerrard is the CFO. I mean, Ross Jerrard, do you want to sort of comment on that?

Speaker #1: And there's no way we're going to freewheel on getting that funding together. We will go flat out as quickly as we can to get all that funding in place, even if it means that we get it earlier than we need it.

Speaker #1: I mean, Ross, do you want to Ross at the CFO? I mean, Ross, do you want to sort of comment on that? You got to go on an extended holiday.

Ross Jerrard: Absolutely.

Mark Learmonth: Are you going to go on extended holiday and not raise the money?

Speaker #1: I'm not raising the money.

Speaker #2: No, no. Full steam ahead. We want it all in place, and then we can talk about timing of drawdowns and the like.

Ross Jerrard: No. Full steam ahead. We want it all in place, and then we can talk about timing of drawdowns and the like. Yeah.

Speaker #1: Okay.

Mark Learmonth: Okay. Thank you very much. Okay. Thank you.

[Analyst 1]: Okay. Thank you very much.

Speaker #2: Thank you very much.

Speaker #1: Okay. Thank you.

Mark Learmonth: Okay. Thank you.

Speaker #3: Can I just remind people, if you'd like to ask a question, please do raise your hand, which is in the bottom toolbar. I'm just going to pause for a moment while we wait for people to ask a question.

Moderator: Can I just remind people if they would like to ask a question, please do raise your hand, which is in the bottom toolbar. I am just going to pause for a moment whilst we wait for people to ask a question. We have our next question from Yuan Low. Please go ahead. Your line is open.

Operator: Can I just remind people if they would like to ask a question, please do raise your hand, which is in the bottom toolbar. I am just going to pause for a moment whilst we wait for people to ask a question. We have our next question from Yuan Low. Please go ahead. Your line is open.

Speaker #3: We have our next question from Ian Lowe. Please go ahead, your line is open.

Speaker #4: Hello, everyone. Thanks for taking my questions, and congratulations on another good result. Can I ask whether you can give any color on things like commitment fees and the interest rates—10 years and so on?

Yuan Low: Hello, everyone. Thanks for taking my questions, and congratulations on another good result. Can I ask whether you can give any color on things like commitment fees and the interest rates, tenures, and so on, for the interim funding and for the project finance? I know it is probably too early.

[Analyst 2]: Hello, everyone. Thanks for taking my questions, and congratulations on another good result. Can I ask whether you can give any color on things like commitment fees and the interest rates, tenures, and so on, for the interim funding and for the project finance? I know it is probably too early.

Speaker #4: For the various, for the interim funding and for the project finance, I know it's probably too early.

Speaker #3: Yeah, let's say it's just too early. What I can say,

Mark Learmonth: This stage is too early. All I can say is the two key criteria here are speed, a project of this size and quality, any delay in implementing it will cost money in terms of NPV per share. That is the first thing. The second thing, just be clear, is that all of these debt funding structures, the cost of those compared to our cost of equity, it does not even begin to Our cost of equity is so eye-wateringly expensive that the cost of the various debt facilities is, I will not say we are price insensitive, but it is not a major cause for concern. I think you are sort of splitting a hair that just does not need splitting. But at this stage, it is too early to say.

Speaker #1: all I can say is the two key criteria here. A speed. The quality of project of this size and quality. If we don't any delay in implementing it, we'll cost money in terms of NPV per share.

Speaker #1: That's the first thing. And the second thing, just to be clear, is that all of these debt funding structures—compared to the cost of those, compared to our cost of equity—don't even begin to compare. Our cost of equity is so eye-wateringly expensive.

Speaker #1: The cost of the various debt facilities is—I'm not saying we're price insensitive, but it's not a major cost of concern. So, I think you're kind of splitting a hair that just doesn't need splitting.

Speaker #1: But at this stage, it's too early to say.

Speaker #4: That's fine. I'm just asking for modeling purposes.

Yuan Low: Oh, that is fine. I am just asking for modeling purposes.

[Analyst 2]: Oh, that is fine. I am just asking for modeling purposes.

Speaker #1: Yeah.

Mark Learmonth: Yeah.

Speaker #4: All right. And for Craig, I know you've said it's also too early to give us any methodological results, but I was just curious as to the nature of the refactoriness, if any, at the K-bids in the south sites.

Yuan Low: For Craig Harvey, I know you have said it is also too early to give us any metallurgical results, but I was just curious as to the nature of the refractoriness, if any, at the K-Pits in the south sites, and potentially the transition zone. Also, why are you wearing a jacket? A heavy jacket.

[Analyst 2]: For Craig, I know you have said it is also too early to give us any metallurgical results, but I was just curious as to the nature of the refractoriness, if any, at the K-Pits in the south sites, and potentially the transition zone. Also, why are you wearing a jacket? A heavy jacket.

Speaker #4: And potentially the transition zone. Also, why are you wearing a heavy jacket?

Speaker #1: I was going to take one just on the last one because it's in Johannesburg, and he's bleating about it being cold. That's why he's wearing a jacket.

Mark Learmonth: Just on the last one, because it is in Johannesburg and he is bleating about it being cold. That is why he is wearing a jacket.

Speaker #3: That's freezing. But yes, look, I mean, what are what are can remind you is that just remember that blank that the blanket all bodies that we mine are all free or all free milling.

Craig Harvey: It is freezing. Yes, look, what I can remind you is that just remember that the Blanket Mine ore bodies that we mine are all free-milling. I cannot go beyond that. We have done water roll testing on our drill assays, and they are all in the press release that we put out there. Water roll assays, so that is direct cyanide aeration for 24 hours to a fire assay value, we are getting 80% to 85%. I would be expecting on a heap leach to recover 90% to 95% of that.

Speaker #3: So I can't go beyond that. We have done all water testing on our drill, all assays, and they are in the press release that we put out there.

Speaker #3: And what are all assays? So that is direct sign, adaptation for 24 hours, to a fire assay value. We're getting 80 to 85 percent.

Speaker #3: So I would be expecting, on a heap leach, to recover 90 to 95 percent of that.

Speaker #4: Okay. Thank you very much.

Yuan Low: Okay. Thank you very much.

[Analyst 2]: Okay. Thank you very much.

Mark Learmonth: Sorry, Yuan Low, was your question about the refractory nature of the sulfide, the underlying sulfide?

Speaker #1: So, Iwan, what's your question about the refractory nature of the sulfide—the underlying sulfide?

Speaker #4: Yes, I was asking about that. I was wondering whether it’s sulfides, no-signal refractory, whether it’s having carbon— that sort of thing.

Yuan Low: Yes, I was asking about that. I was wondering whether it is sulfides, something refractory, whether there is anything carbon, that sort of thing.

[Analyst 2]: Yes, I was asking about that. I was wondering whether it is sulfides, something refractory, whether there is anything carbon, that sort of thing.

Mark Learmonth: Craig Harvey, at this stage, are you able to give any indication as to whether we have any basis to believe that the underlying sulfide could be tricky to treat?

Speaker #1: Craig, I mean, at this stage, are you able to give any indication as to whether we have any basis to believe that the underlying sulfide could be tricky to treat?

Speaker #5: No.

Craig Harvey: No. Look, at this stage, there is nothing that gives an indication, either way, that it is in any way different to the sulfide ores that we mine at Blanket Mine at the moment. There is nothing that is saying that it is refractory. But I do not have any information that I can give you to say that it is not.

Speaker #3: Look, at this stage, there's nothing that gives an indication either way that it's there, that's in any way different to the sulfide ores that we mine at Blanket at the moment.

Speaker #3: There's nothing that's saying it is refractory, but I don't have any information that I can give you to say that it's not.

Mark Learmonth: But clearly, it is something we will be evaluating.

Speaker #1: Clearly, it's something we will be evaluating.

Speaker #3: Yeah.

Craig Harvey: Yeah.

Speaker #4: Okay. Wonderful. Thank you.

Yuan Low: Okay. Wonderful. Thank you.

[Analyst 2]: Okay. Wonderful. Thank you.

Speaker #1: Thank you, Iwan.

Mark Learmonth: Thank you, Yuan.

Speaker #2: Thank you. If I could just remind people, if anybody would like to ask a further question, please do so by raising your hand. I'll just wait for one second to allow people to raise their hands.

Moderator: Thank you. If I could just remind people, if anybody would like to ask a further question, please do so by raising your hand. I will just wait for one second to allow people to raise their hand. Mark, as we have got no further questions at the moment, please hand back to yourself for any closing remarks.

Operator: Thank you. If I could just remind people, if anybody would like to ask a further question, please do so by raising your hand. I will just wait for one second to allow people to raise their hand. Mark, as we have got no further questions at the moment, please hand back to yourself for any closing remarks.

Speaker #2: Mark, as we've got no further questions at the moment, please hand back to yourself for any closing remarks.

Speaker #1: Okay. Well, thank you all for your time. I think this quarter just finished as a bit of a transitional quarter. From a very disappointing first quarter, I think we've set ourselves up for a very exciting sort of closing half to the year.

Mark Learmonth: Well, thank you all for your time. I think this quarter just finished has been a transitional quarter. From a very disappointing Q1, I think we have set ourselves up for a very exciting closing H2 to the year and a very good start to next year as well. So thank you all for your time and your attendance.

Speaker #1: And a very good start to next year as well. So, thank you all for your time and your attendance.

Moderator: Thanks very much. That concludes the Caledonia Mining Q2 trading update. Thank you very much for your time today.

Operator: Thanks very much. That concludes the Caledonia Mining Q2 trading update. Thank you very much for your time today.

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