Full Year 2026 Lynas Rare Earths Ltd Earnings Call

August 26, 2026

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Speaker #2: Good morning, and welcome to the Lynas Rare Earths Investor Briefing for the 2026 financial year. Today's briefing will be presented by Paul Leroux, Interim CEO, and joining Paul are Gaëtane Sterzenega, CFO; Chris Jenny, VP Sales and Market Development; Daniel Havas, VP Strategy and Investor Relations; and Sarah Leonard, General Counsel and Company Secretary.

[Company Representative] (Lynas Rare Earths): Good morning and welcome to the Lynas Rare Earths investor briefing for the 2026 financial year. Today's briefing will be presented by Pol Le Roux, Interim CEO. Joining Paul are Gaudenz Sturzenegger, CFO, Chris Jenney, VP Sales and Market Development, Daniel Havas, VP Strategy and Investor Relations, and Sarah Leonard, General Counsel and Company Secretary. I will now hand over to Paul. Please go ahead, Paul.

Jen Parker: Good morning and welcome to the Lynas Rare Earths investor briefing for the 2026 financial year. Today's briefing will be presented by Pol Le Roux, Interim CEO. Joining Paul are Gaudenz Sturzenegger, CFO, Chris Jenney, VP Sales and Market Development, Daniel Havas, VP Strategy and Investor Relations, and Sarah Leonard, General Counsel and Company Secretary. I will now hand over to Paul. Please go ahead, Paul.

Speaker #2: I'll now hand over to Paul. Please go ahead, Paul.

Speaker #3: Thank you, Jen, and good morning, everybody. Thank you very much for your interest in Lynas and in our company. First of all, I would like to acknowledge the traditional owners of the land on which we live, work, and meet across Australia.

Pol Le Roux: Thank you, Jen, and good morning, everybody. Thank you very much for your interest in Lynas, in our company. First of all, I would like to acknowledge the traditional owners of the land on which we live, work, and meet across Australia. We acknowledge and value Lynas Aboriginal and Torres Strait Islanders employees, partners, and communities, and pay respect to their elders, past and present. This applies to elders in and outside Australia, of course. Prior to going through the presentation, I would like to spend a bit of time sharing with you what makes Lynas, what makes us comfortable facing the challenges and opportunities of the future.

Speaker #3: We acknowledge and value Lynas’ Aboriginal and Torres Strait Islander employees, partners, and communities, and pay respect to their elders past and present. This respect applies to elders both in and outside Australia, of course.

Speaker #3: Prior to going through the presentation, I would like to spend a bit of time sharing with you what makes Lynas, what makes us comfortable tracing the challenges and opportunities of the future.

Speaker #3: While preparing for her farewell, Amanda went around and asked everyone to define Lynas in a few words. And the best statement came from Karul, the GM of Lynas in Malaysia, who stated, "Lynas is personal." Indeed, Lynas is defined by its exceptional workforce.

Pol Le Roux: While preparing for her farewell, Amanda went around and asked everyone to define Lynas in a few words. The best statement came from Karul, the GM of LAMP in Malaysia, who stated, "Lynas is personal." Indeed, Lynas is defined by its exceptional workforce. We have gone through challenges over the years, but most important, we learn from those challenges. Today, we have in our people an exceptional level of expertise in market knowledge recognized by our customers and competitors, and in rare earth processing and innovation. I just want to spend a bit more time on the importance of innovation capability in the rare earth industry. The dominant players and our main competitors are Chinese. They started 50 years ago, before anyone else. They are expert in the field.

Speaker #3: We've gone through challenges over the years, but most important, we learned from those challenges. Today, we have new people and an exceptional level of expertise.

Speaker #3: Being market knowledgeable, recognized by our customers and competitors, earning real credibility in processing and innovation. And I just want to spend a bit more time on the importance of innovation capability in the real industry.

Speaker #3: The dominant players, and our main competitors, are Chinese. They started 50 years ago, before anyone else. They are experts in the field. Lynas has invested substantial effort in R&D for several years and built an extraordinary team, developing specific expertise in geology, concentration, cracking, solvent extraction, and product finishing, as well as developing new products addressing markets of the future.

Pol Le Roux: Lynas has invested substantial effort in R&D for several years and built an extraordinary team developing specific expertise in geology, concentration, cracking, solvent extraction, and product finishing, as well as developing new products addressing markets of the future. Most important to me is that in our R&D program, we partner with the best institutes around the world, from France to US, Japan, and Australia. Believe me, 10 years ago, they would not pay much attention to us. Today, they are all very eager to participate in our programs. This credibility from scientists working on our future is a tremendous achievement from the team.

Speaker #3: Most important to me is that, in our R&D program, we partner with the best institutes around the world— from France to the US, Japan, and Australia.

Speaker #3: Believe me, ten years ago they wouldn't pay much attention to us. Today, they are all very eager to participate in our programs. And this credibility from scientists working on our future is a tremendous achievement from the team.

Speaker #3: In short, the team has a very strong track record of addressing and fixing issues when they arise, but also a unique capability to prepare for the future—developing more efficient processes, improving the environmental impact, and developing new products, especially those that support the development of new energy.

Pol Le Roux: In short, the team has a very strong track record of addressing and fixing issues when they arise, but also a unique capability to prepare for the future, developing more efficient processes, improving the environmental impact, and developing ahead new products, especially supporting the development of new energy. Yes, Lynas is personal. A team working together to maximize our results every day and prepare to deliver on our great ambition for the future. Going back into the pack. The first refers, obviously, and that is, Lauren, page 5, to our safety performance and the status of our Yes, We Care For Each Other program. In FY26, we are very proud to have delivered an excellent LTI, ending at 0.9, which is half of FY25.

Speaker #3: So yes, Lynas is personal—a team working together to maximize our results every day and prepare to deliver on our great ambition for the future.

Speaker #3: Going back into the pack, the first refers, obviously, and that's Lauren Page, five, to our safety performance, and the status of our Yes, We Care for Each Other program.

Speaker #3: In FY26, we are very proud to have delivered an excellent LTI of 0.9, which is half of FY25. Nevertheless, safety is a never-finished job, so our increase in TRIF is being addressed by the team, focusing on reducing strains and sprains through engineering and training.

Pol Le Roux: Nevertheless, safety is a never-finished job, so our increase in TRIFR is being addressed by the team, focusing on reducing strains and sprains through engineering and training. That is really something that we take very seriously. Now, moving to the business side. Let me share with you where we stand versus our Towards 2030 program, which we can summarize, page 6, in harvesting and growing. Moving forward to page 7, Lauren. I have been in Mount Weld the last two days, and I am now in Kalgoorlie. Mount Weld is going through an exceptional ramp-up of the expansion facility. Of course, we always have small issues, but very little, and we are almost done except for the TSF4, which is being finalized to prepare for future production. It is really a very good achievement of the team, both the project team and the operation team.

Speaker #3: And that is really something that we take very, very seriously. Now, moving to the business side, let me share with you where we stand versus our Towards 2030 program, which we can summarize as page 6 in Harvesting and Growing.

Speaker #3: So, moving forward to page 7. Lauren, I've been in Montreal for the last two days, and I'm now in Kalgoorlie. Montreal is going through an exceptional ramp-up of the expansion facility.

Speaker #3: It's been, of course, we always have small issues, but very, very little, and we are almost done—except for the TSF4, which is being finalized to prepare for future production.

Speaker #3: So it's really a very good achievement of the team, both the project team and the operations team. That is an operation that we can rely on very comfortably.

Pol Le Roux: That is an operation that we can rely on very comfortably. Today, I am in Kalgoorlie, and Kalgoorlie has actually delivered very important improvements through the year. You remember that we had quality issues in the product. So the Mixed Rare Earth Carbonate produced at Kalgoorlie, those quality issues have been fixed. In particular, through a change in the precipitation process that was executed perfectly. In a week time, everything was changed and the quality of product improved substantially, making it very easy for LAMP in Malaysia to process this product. So that is this new feedstock. We have seen less minor modifications to increase the nameplate capacities between gas treatment. This is under progress. All the products and spares that we used to source from China, it took a while, it was a bit of a challenge, but now it is secured.

Speaker #3: Today, I'm in Kaguli, and Kaguli has actually delivered very, very important improvements through the year. You remember that we had quality issues in the product for the MREC produced at Kaguli—those quality issues have been fixed.

Speaker #3: In particular, through a change in the precipitation process that was executed perfectly in a week's time, everything was changed, and the quality of the product improved substantially, making it very easy for LAMP in Malaysia to process these products.

Speaker #3: So that's this new fixed stock. We still have minor modifications left to increase the nameplate capacity, especially in gas treatment. This is under progress.

Speaker #3: And all the products and spares that we used to source from China took a while. It was a bit of a challenge, but now it's secured.

Speaker #3: We are 100% non-China dependent, and so that makes Kalgoorlie ready to grow and to deliver up to where we expect them to be. Quantum had a fantastic year.

Pol Le Roux: We are 100% non-China dependent, and that makes Kalgoorlie ready to grow and to deliver up to where we expect them to be. Kuantan had a fantastic year. We had the best ever performance in cracking leaching. The SX was tested as the new nameplate capacity successfully. pH has been modified and that improved a lot our productivity and, very important, energy efficiency. Of course, we started to deliver commercially dysprosium terbium. So that is all about the harvesting. So it is harvesting Lynas 2025 is almost, I would say, very close to being done and ready to grow further. Going further and starting with strengthening our sales, a very important agreement is the agreement signed with JARE. It is a 12 years agreement. JARE is, and definitely speaking, it is a very important and exceptional partner for Lynas and vice versa. We have gone through a difficult time together.

Speaker #3: We had the best-ever performance in cracking leaching. The asset was tested at the new nameplate capacity successfully. PF has been modified, and so that improved a lot our productivity and, very importantly, energy efficiency.

Speaker #3: And of course, we started to deliver commercially this Prosium turbine. So that's all about the harvesting. So, harvesting Lynas 25 is, I would say, almost very close to being done.

Speaker #3: And ready to grow further. So, growing further and starting with strengthening ourselves, a very important agreement is the agreement signed with Jared. So, it's a 12-year agreement.

Speaker #3: Jared is, and definitely speaking, a very important and exceptional partner for Lynas – and vice versa. We've gone through difficult times together, we've succeeded together, and we are working together to further enhance this partnership.

Pol Le Roux: We succeeded together, and we are working together to further enhance this partnership. So that is a very important agreement for us, and we are still working on developing this further. As for the growth, well, we have established a specific team dedicated to the development of resources. This applies to Mount Weld, of course, the carbonatite, addressing, and I was discussing that with the team yesterday, how fast we can address the high dy terbium zones in the mine and process it in Kuantan. Of course, looking at the possible additional resources, especially if they have different rare distribution compared to Mount Weld, so with more heavies and less light rares. These are a number of discussions going on, and we have a very well-structured team to evaluate and then discuss these opportunities.

Speaker #3: So that's a very important agreement for us, and we are still working on developing this further. As for the growth, we have established a specific team dedicated to the development of resources.

Speaker #3: So, this applies to Montreal, of course, the Kawana tight addressing, and I was discussing that with the team yesterday—how fast we can address the high DY turbine zones in the mine and process it in Quantum.

Speaker #3: And of course, looking at the possible additional resources, especially if they have a different risk distribution compared to Montreal. So, with more heavies and fewer light rares.

Speaker #3: So, these are a number of discussions going on, and we have a very well-structured team to evaluate and then discuss those opportunities. Regarding the development of the new heavy rare separation, it is on track.

Pol Le Roux: Regarding the development of the new heavy rare separation, it is on track. It is on track with our plan. So we have delivered in 2025 dy terbium. We have delivered samarium a bit ahead of schedule in March 2026. The next step for us will be to deliver gadolinium and yttrium. That should be in the H1 of FY28. Then finally, an increased production of samarium and lutetium finally in the H1 of calendar year 2028. So we are on track, under control, and this is very promising development in lab and in Lynas overall. The last pillar of our strategy consists in supporting the development of downstream industries.

Speaker #3: This is on track with our plans. So the plan is, we have delivered in 25 DY turbine. We have delivered some areas a bit ahead of schedule in March 26.

Speaker #3: The next step for us will be to deliver Gadolinium-3; that should be in the first half of fiscal year '28. And then finally, an increased production of samarium and lutetium in the first half of calendar year '28.

Speaker #3: So we are on track, under control, and this is a very promising development in the lab and in Lynas as well. The last pillar of our strategy consists in supporting the development of downstream industries, and so you saw that we signed a partnership with GS Link, with an investment of $50 million by Lynas into GS Link, and the rest of the project in Malaysia being funded by GS Link.

Pol Le Roux: You saw that we signed a partnership with JS Link, with an investment of AUD 50 million by Lynas into JS Link, and the rest of the project in Malaysia being funded by JS Link. This is important per se, because this adds further downstream capacity magnet making outside China. It is also politically very important for us to contribute, fair enough, to the development of Malaysia as a rare earths hub, and we will continue doing that because we are fully engaged in the development of Malaysia as an integrated rare earths player. Another partnership signed is with LS Cable from, again, Korea, whereas we work together on the development of metal making, which is an important step in the magnet supply chain and still quite dependent on China. So it is really an area where we work very hard.

Speaker #3: This is important, per se, because this adds further downstream capacity for magnet making outside China. This is also politically very important for us, to contribute fairly enough to the development of Malaysia as a rare hub.

Speaker #3: And we'll continue doing that because we are fully engaged in the development of Malaysia as an integrated rare earth player. Another partnership signed with LS Cable from, again, Korea.

Speaker #3: Whereas we worked together on the development of metal making, which is an important step in the magnet supply chain and still quite dependent on China.

Speaker #3: So it's really an area where we work very hard. And finally, an MOU was signed with Navion in the US for the development of magnet making.

Pol Le Roux: Finally, a MoU signed with Noveon Magnetics in the US for development of magnet making. We have, of course, a lot of other discussions ongoing, which is a bit too early to discuss about, but we are on track on that development, and more developments are yet to come. On page 8, financial results. I think the numbers speak by themselves. It is a wonderful improvement in our results, supported by this time both better price level, market price level, a price premium delivered by the sales marketing team versus market, a slight or an increase in product volume and of course, on product offering. This will continue improving our top line since we will add more product in our portfolio in the coming quarters, let us say. Adding to this, and you will notice a very big focus and discipline on the CapEx spending.

Speaker #3: And we have, of course, a lot of other discussions ongoing, which is a bit too early to discuss, but we are on track on that development.

Speaker #3: And more developments are yet to come. On page 8, financial resources, I think the numbers speak for themselves. It's a wonderful improvement in our resources.

Speaker #3: Supported by this time, both better price level—market price level—and a price premium delivered by the sales and marketing team versus market. A slight, or an increase, in product volume, and of course, on product offering.

Speaker #3: And this will continue improving our top line, since we'll add more product to our portfolio in the coming quarters, let's say. Adding to this, and you will notice, there is a very big focus and discipline on the capex spending.

Speaker #3: So we are spending our shareholders' money wisely. And so the amount of capex spent—and that's probably on the next page, Lauren—has decreased substantially in the past year.

Pol Le Roux: We are spending our shareholders' money wisely. The amount of CapEx spent, and that is probably on the next page, Lauren, has decreased substantially in the past year, in line with the end of the big projects, be it expansion in Mount Weld, Kalgoorlie, and the industrial plant in Kuantan. Moving forward on the business, on the market side, I would simply say that the market today, and I insist on that because in the 25 years I have spent in the rare earths industry, it has not been always the case, but today the market is clearly driven by energy-efficient motors and therefore the magnet needed for those motors. This continues to be growing very fast and at an average of, let us say, 10% a year, and very few markets have such growth. I do not foresee replacement of that permanent magnet technology.

Speaker #3: In line with the end of the big projects—the expansion in Montreal, Calgary, and the industrial plan in Quantum—so moving forward, on the business and on the market side, I would simply say that the market today—and I insist on that because in the 25 years I've spent in the risk industry, it's not always been the case—but today, the market is clearly driven by energy-efficient motors and therefore the magnets needed for those motors.

Speaker #3: This continues to be growing very fast, at an average of, let's say, 10% a year, and very few markets have such growth. I don't foresee replacement of that permanent magnet technology.

Speaker #3: There is innovation in the magnet making, but not disruptive developments. And so, I think the current price, which is supporting us a lot, actually—well, actually, I foresee that to be maintained, to sustain, because that's the price level needed for additional resource development.

Pol Le Roux: There is innovation in the magnet making, but not disruptive developments. I think the current price which is supporting us a lot actually, well, actually I was forcing them to maintain because to sustain, because that is the price level needed for additional resource development. That will be all benefit for Lynas, which is an already established business. The key to further develop the downstream market, which is essential for us, we need to develop the downstream market outside China. I would summarize that in a few words. Number one, you need to have the engagement of OEMs. Since 2010 when I joined Lynas, there was a little bit of excitement in 2011 with the first rare earths crisis, and then this faded away.

Speaker #3: And so, that will all benefit Lynas, which is already an established business. The key to further developing the downstream market, which is essential for us, is that we need to develop the downstream market outside China.

Speaker #3: I would summarize that in a few words. Number one, you need to have the engagement of OEMs. Since 2010, when I joined Lynas, there was a little bit of excitement in 2011 with the first risk crisis, and then this faded away.

Speaker #3: I have to say that today, when you meet with a car OEM or wind turbines or otherwise, everyone is really serious about securing at least part of their sourcing from outside China—not being fully dependent on a single country.

Pol Le Roux: I have to say that today when you meet with a car OEM or wind turbines or otherwise, everyone is really serious about securing at least part of their sourcing from outside China and not being fully dependent on a single country. I insist I have absolutely nothing against China, but I think for the industry it is very important that we learn that through, among other things, the COVID pandemic, that there are some risks in depending too much on one single country for an industry. The engagement of OEM is here, and that is essential. Of course, in this difficult challenge to catch up the development of this rare earths supply chain that has been left to China for 40, 50 years, the transition is very challenging and you need here government support.

Speaker #3: I have—I insist, I have absolutely nothing against China. But I think for the industries, it's very important that we learn that through, among other things, the COVID pandemic.

Speaker #3: There are some risks in depending too much on one single country for an industry. So the engagement of OEM is here, and that is essential.

Speaker #3: Of course, in this difficult challenge to catch up with the development of this risk supply chain that has been left to China for 40 or 50 years, the transition is very challenging, and you need government support here.

Speaker #3: And I think you see news from everywhere and see different governments around the world quite engaged in supporting the development of the industry. And for what is under our control, the key, very simple element: what can Lynas do to support the development of downstream industry?

Pol Le Roux: I think you see news from everywhere and see different governments around the world quite engaged in supporting the development of the industry. For what is under our control, the key, very simple element, what can Lynas do to support the development of downstream industry? Well, basically it is simple. We need to produce more dysprosium terbium, and we need to provide recycling of swarf. When you produce magnets, you lose 30% of your raw material in the magnet making, and you need to have access to a recycling capability, and that is a very important proposal from Lynas. To accelerate as fast as possible our dysprosium terbium production. That goes into the development of resource and especially Mount Weld and other opportunities, as well as providing to our magnet makers the possibility to successfully recycle their swarf on our facility in Malaysia.

Speaker #3: Well, basically, it's simple. We need to produce more Dy terbium, and we need to provide recycling of swarf. When you produce magnets, you lose 30% of your raw material in the magnet making, and you need to have access to a recycling capability.

Speaker #3: And that's a very important proposal from Lynas to accelerate as fast as possible our Dy-Terbium production. And that goes into the development of resource, and especially Mt Weld, and other opportunities.

Speaker #3: As well as providing magnet makers with the possibility to successfully recycle their swarf at our facility in Malaysia. There are more slides illustrating each project throughout the pack, and achievements through the year.

Pol Le Roux: That will be. There are more slides illustrating these projects through the pack and achievements through the year. Again, a great year. A great year where we added success to our track records. Some are visible, samarium production, agreement signed with downstream players, with Japan. Other successes are not visible, but they prepare for our future, and this is the step-up of our people expertise, discipline, teamwork across the organization. This is the time to be ambitious, to seize opportunities, and there are many. We are, I believe, best equipped for that and face the future with confidence. On that, I would be happy to answer or, as best as I can, answer questions if there are. I move back to you, Michelle.

Speaker #3: Again, a great year. A great year where we added success to our track records. Some are visible; some are in production—agreements signed with downstream players, with Japan.

Speaker #3: Other successes are not visible, but they prepare for our future. And this is the step-up of our people: expertise, discipline, teamwork across the organization.

Speaker #3: And this is the time to be ambitious, to see the opportunities—and there are many. So we are, I believe, best equipped for that and face the future with confidence.

Speaker #3: With that, I would be happy to answer—or do my best to answer—any questions if there are any. And I'll move back to you, Michel.

Speaker #1: Thank you, Paul. If you have not yet joined the live audio queue, please do so now. To hear from as many people as possible, we request that you ask one question at a time.

Operator: Thank you, Paul. If you have not yet joined the live audio queue, please do so now. To hear from as many people as possible, we request that you ask one question at a time. If you have more questions, please rejoin the queue. I will introduce each caller by name and ask you to go ahead. You will then hear a beep indicating your microphone is live. Our first question comes from Rahul Anand from Morgan Stanley. Rahul, please go ahead after the beep.

Speaker #1: If you have more questions, please rejoin the queue. I will introduce each caller by name and ask you to go ahead. You will then hear a beep indicating your microphone is live.

Speaker #1: Our first question comes from Rahul Anand from Morgan Stanley. Rahul, please go ahead after the beep.

Rahul Anand: Hi, Paul and team. Thanks for the call. Appreciate your time. I want to ask a couple of questions in terms of future direction of the business, but I am going to focus firstly on the cost side, if that is okay, and then I might queue back again. In terms of your cost base, I just want to touch upon the G&A and the fixed cost base going forward. Obviously, there was a footnote in your statements today which talked about some of the costs basically being expensed in the G&A line as you were managing the inventories. But in terms of your operating cost base and fixed cost base, is this the right level for us to be using to forecast going forward? Or can you point to any initiatives that you have for either lowering your fixed cost base?

Speaker #3: Hi Paul and team, thanks for the call—appreciate your time. I want to ask a couple of questions in terms of the future direction of the business, but I'm going to focus firstly on the cost side, if that's okay, and then I might queue back in again.

Speaker #3: In terms of your cost base, I just want to touch upon the G&A and the fixed cost base going forward. Obviously, there was a footnote in your statements today which talked about some of the cost basically being expensed in the G&A line as you were managing the inventories.

Speaker #3: But in terms of your operating cost base and fixed cost base, is this the right level for us to be using to forecast going forward, or can you point to any initiatives that you have for either lowering your fixed cost base or, otherwise, if we should be thinking about a higher cost base as you produce more in the future and ramp up?

Rahul Anand: Or otherwise, if we should be thinking about higher cost base as you produce more in the future and ramp up.

Speaker #2: Okay. Thanks, Rahul. That's a very good question. Obviously, we are focused on unit fixed cost, and I think the reflection of, or the fixed costs of this year, are actually the results of an increase in the volume of fixed costs, whereas the volume and production will increase in a short time period.

Pol Le Roux: Okay, thanks, Rahul. That is a very good question. Obviously, we are focused on unit fixed costs, and I think the reflection of the fixed costs of this year are actually the results of an increase in volume of fixed costs, whereas the volume and production will increase in a short time period. They are, and Gerdhans can illustrate that, there are also in this year some exceptional elements in the fixed cost. I do not know how much we can disclose on that. So definitely, the current fixed cost level is something you could anticipate decreasing over time. Gerdhans, maybe you can give some elements on what is exceptional because there are some elements exceptional for this year.

Speaker #2: And there are, and governments can illustrate that. There are also in this year some exceptional elements in the fixed costs. I don't know how much we can disclose on that.

Speaker #2: So, definitely, the current fixed cost level is something you could anticipate decreasing over time. Governments—maybe you can give some elements on what is exceptional, because there are some elements that are exceptional for this year.

Speaker #3: Yeah. Okay. Yeah. Rahul, I think that's a good point. I think what we have seen in the G&A line is an increase—I think it's $34 million. Out of this, it's really $23 million in under-absorbed cost, which will work itself out when we fully ramp up or ramp up CAL.

Gaudenz Sturzenegger: Yeah. Okay. Yeah, Rahul. I think the good point, I think we have seen in the G&A line increase, I think it is 34 million. Out of this, it is really 23 million is underabsorbed costs, which will work itself out when we fully ramp up or ramp up Kal. So that is, let us call it a temporary placement. The cost you have seen in the other G&A, the 10 million, there I might refer you to the Rem report, page 209. I think more than half it is explained there. I think it has to do kind of with the leadership change. That is, I would say, a one-time effect. Overall, I would say obviously with having the balance more in Kalgoorlie versus Kalgoorlie becoming stronger in the mix, you have a certain base effect. But, I do not think the base you see today is the right one.

Speaker #3: So, that's—let's call it temporary placement. The cost you have seen in the other G&A, the $10 million—there, I might refer you to the REM report, page 209.

Speaker #3: I think more than half is explained there. I think it has to do kind of with the leadership change. That, I would say, is a one-time effect.

Speaker #3: And overall, I would say, obviously, with having the balance more Kalgoorlie versus Kalgoorlie becoming stronger in the mix, you have a certain base effect.

Speaker #3: But I don't think the base you see today is the right one. I do see that, also with the issues we have on the OR, that if it's working itself through the process, we will also see a kind of moderation of the cost there.

Gaudenz Sturzenegger: But, I do not think the base you see today is the right one. I do see also with the issues we have on the ore, that if it is working itself through the process, we will also see a moderation of the cost there. I would not use the cost base as it is. I would see an easing of it. There is one big element which is going completely the opposite side, and that is the sulfuric acid price, which is very important for us, and it is four times more than it was 12 months ago. I think the expectation there is that it will probably not. Well, it is a good chance that in a couple of months we see a moderation on that cost. But that is one cost which is really blowing out geopolitical issues on that one.

Gaudenz Sturzenegger: I do see also with the issues we have on the ore, that if it is working itself through the process, we will also see a moderation of the cost there. I would not use the cost base as it is. I would see an easing of it. There is one big element which is going completely the opposite side, and that is the sulfuric acid price, which is very important for us, and it is four times more than it was 12 months ago. I think the expectation there is that it will probably not. Well, it is a good chance that in a couple of months we see a moderation on that cost. But that is one cost which is really blowing out geopolitical issues on that one.

Speaker #3: So I would not use the cost base as it is. I would see an easing of it. There is one big element which is going completely the opposite way, and that's the sulfuric acid price.

Speaker #3: Which is very important for us. And it's four times more than it was, kind of, 12 months ago. I think the expectation there is that there is a good chance that in a couple of months we may see moderation on that cost.

Speaker #3: But that's one cost which is really kind of blowing out—geopolitical issues on that one. Expectation depending on what our friends in Washington and Iran and wherever are doing.

Gaudenz Sturzenegger: Expectation about, depending what our friends in Washington and Iran and wherever are doing, we would hope it will come back over this financial year, I hope. I hope that gave you a little bit color.

Speaker #3: We would hope it will come back over this financial year—I hope. I hope that gave you a little bit of color.

Speaker #1: The next question is from Paul Young from Goldman Sachs. Paul, please go ahead after the beep.

Operator: The next question is from Paul Young from Goldman Sachs. Paul, please go ahead after the beep.

Paul Young: Thanks. Morning, Paul, Gerdhans, and team. First question is on just the outlook for FY27. In theory, nothing is really constraining you from ramping up NdPr production to 10,000 tons or so. It sounds like Mount Weld is running better. Kal is proven, but you do not need to run it much anyway considering the cracking leach capacity in Malaysia. But, the question is actually more around additional NdPr offtake. Considering you can sell up to 7,200 tons to Japan, you have also got the agreements coming through with JS Link, albeit the magnet facility has not been FID'd yet and needs to be constructed and the agreement with Noveon. But the question is actually more around, what should we expect on additional offtakes in FY27? Should it just be the JS Link and Noveon, or do you actually think that you can actually announce or actually sign more offtake with Japan?

Speaker #3: Thanks. Morning, Paul. Gerard Enns and Sam. First question is on just the outlook there for '27. Like, in theory, nothing's really constraining you from ramping up NdPr production to 10,000 tons or so.

Speaker #3: It sounds like Mt Weld’s running better. CAL’s sort of proven, but you don’t need to run it much. Anyway, considering the cracking and leaching capacity, and in Malaysia.

Speaker #3: But the question is actually more around additional NdPr offtake, considering you can sell up to 7,200 tons to Japan. You've also got the agreements coming through with JS Link, albeit the Magna facility hasn't been FID'd yet.

Speaker #3: And needs to be constructed, and the agreement with Novian. But the question is actually more around, what should we expect on additional offtakes in FY '27?

Speaker #3: Should it just be JS, Link, and Novian, or do you actually think that you can announce—or actually sign—more offtakes with Japan?

Paul Young: Should it just be the JS Link and Noveon, or do you actually think that you can actually announce or actually sign more offtake with Japan?

Speaker #2: Well, okay. That's a good question. You understand that, first, there are lots of ongoing discussions for additional offtakes—from OEMs, from new magnet makers—to come.

Pol Le Roux: Well, that's a good question. You understand that, first, there are lots of ongoing discussions for additional offtakes from OEMs, from new magnet makers to come. There will be more. I cannot tell you specifically who and when. But definitely, when you look forward to 2030, Chris Jenney and his team basically are able to move the cursor back to production, say we need more production. So that's a very good point on the sales marketing. All the efforts made are in line with that to accelerate the development of downstream projects and capacity increase and secure long-term offtake from Lynas to those projects, including direct purchase from OEMs. One critical, as I said, one very important element, very simple, we are the first DY terbium supplier outside China, and that's a great achievement.

Speaker #2: So there will be more. I can't tell you—I can't tell you specifically who and when. But definitely, when you look forward to 2030, Chris, Jamie, and his team basically are able to move the cursor back to production and say, we need more production.

Speaker #2: So that’s a very good trend in sales and marketing, and all the efforts made are in line with that—to accelerate the development of downstream projects and increase capacity.

Speaker #2: And secure long-term offtakes from liners to those projects, including direct purchase from OEMs. And one critical— as I said, one very important element, very simple.

Speaker #2: We are the first DY Turbion supplier outside China. And we need to and that's a great achievement. But the it's very critical for us to accelerate that development because the world outside China is very short of DY Turbion.

Pol Le Roux: But it's very critical for us to accelerate that development, because the world outside China is very short of DY terbium. That's the main constraint, I would say.

Speaker #2: That's the main constraint, I would say.

Operator: Thank you. The next question comes from Mitch Ryan from Jefferies. Mitch, please go ahead after the beep.

Speaker #1: Thank you. The next question comes from Mitch Ryan from Jefferies. Mitch, please go ahead after the beep.

Speaker #3: I thank you all. My question just relates to, I guess, the experience of all the variation in the June quarter, specifically as you were working through that appetite at Mount Weld.

Mitch Ryan: Hi, thank you all. My question just relates to, I guess you experienced ore variation in the June quarter, specifically as you are working through that apatite ore at Mount Weld. Can you just provide an update quarter to date on how concentrate quality is tracking and if that's worked through the system at this point in time?

Speaker #3: Can you just provide an update, quarter to date, on how concentrate quality is tracking and if that's worked through the system at this point in time?

Speaker #2: So I was, as I said, I was in Mount Weld Monday, Tuesday. I'm in Kalgoorlie today, and I will be in Lynas in two weeks' time.

Pol Le Roux: As I said, I was in Mount Weld Monday, Tuesday. I am in Kalgoorlie today, and I will be in London 2 weeks' time. But definitely we have improved. That has been, as I said, a very painful time because it was complex. The quality, the way to segregate ore and prepare a better feed to mill in Mount Weld is now well under control, well done. All the costs and the development we made in modifying or adjusting the processing, both of flotation and cracking leaching, has substantially improved our capability to go through this transition period. Today, and I cross my fingers, but today we are very happy with this quarter production performance, yeah.

Speaker #2: But definitely, we have improved. That has been, as I said, a very painful time because it was complex. So the quality—the way to segregate ore and prepare better feed to kiln and to mill in Mount Weld—is now well under control, well done.

Speaker #2: And all the tests and the development we made in modifying or adjusting the processing, both of rotation and cracking leaching, has substantially improved our capability to go through this transition period.

Speaker #2: So today—and I'll cross my fingers—but today, we are very happy with this quarter's production performance.

Speaker #1: The next question is from Jonathan Sharp from JP Morgan. Jonathan, please go ahead.

Operator: The next question is from Jonathon Sharp from JPMorgan. Jonathan, please go ahead.

Speaker #4: Yeah. Morning, Paul and team. Question from me. Paul, third parties like JS Link building out magnet capacity outside of China—how dependent is that build-out today on Chinese equipment, technology, or even the technical know-how?

Jonathon Sharp: Yeah, morning, Paul and team. Question from me. Paul, for partners like JS Link, building out magnet capacity outside China, how dependent is that build-out today on Chinese equipment, technology or even the technical know-how? Can they realistically scale the capacity with minimal dependence on China?

Speaker #4: Can they realistically scale the capacity with minimal dependence on China?

Pol Le Roux: A very good point. For the detail, I can't disclose what is JS Link company's knowledge in detail. What I can tell you is that their key technical people, I know them pretty well, are basically Japanese experts of very high level. JS Link has developed their IP mostly with Japan, not so much with China. They are quite independent of the Chinese knowledge and expertise. Remember, Japan invented the NdFeB magnets, right? They're on top of the game technically.

Speaker #2: Very good point. Regarding the details, I can't disclose what JS Link company's knowledge is in detail. What I can tell you is that their key technical people—whom I know pretty well—are basically Japanese experts of a very high level.

Speaker #2: And so JS Link has developed their IP mostly with Japan, not so much with China. So they are quite independent of the Chinese knowledge and expertise.

Speaker #2: And remember, Japan invented NdFeB magnets, right? So they are on top of the game technically.

Speaker #1: The next question is from Daniel Morgan from Baron Joey. Daniel, please go ahead.

Operator: The next question is from Daniel Morgan from Barrenjoey. Daniel, please go ahead.

Speaker #3: Hi, Paul and Tim. Just wondering if you could in any way quantify what your production volume expectations for NdPr in FY '27 are. Thank you.

Daniel Morgan: Hi, Paul and team. Just wondering if you could in any way quantify what your production volume expectations for NdPr in FY27 are. Thank you.

Pol Le Roux: You know the answer, Daniel. We don't make forward statement on that. We will definitely continue to ramp up, and primarily make sure that we have enough production to supply all our customers outside China. I can tell you that FY27 will be fairly higher compared to FY26. Pretty higher, yeah. Sorry, I won't give you a number on that, but yeah, pretty high.

Speaker #2: You know the answer, Daniel. We don't make forward statements like that, but definitely, we'll continue to ramp up, and primarily make sure that we have enough production to supply all our customers outside China.

Speaker #2: So I'm quite— I can tell you that FY '27 will be fairly higher compared to FY '26. Pretty higher, yeah. But I won't—sorry, I won't give you a number on that.

Speaker #2: But yeah, pretty high.

Speaker #1: The next question is from Chen Jiang from Bank of America. Chen, please go ahead.

Operator: The next question is from Qin Zhang from Bank of America. Qin, please go ahead.

Qin Zhang: Good morning, Paul. Thank you for taking my question. My question is in regards to your capital allocation framework, if you have one. By looking at Lynas, your balance sheet, you have AUD 1.2 billion sitting at the bank after your equity raise last September. By looking at your cash generation over the next 12 months, I guess you will continue to build cash even though you have CapEx cycle. I am just wondering how the management team currently ranks the capital allocation priorities, because you have so many small projects like Towards 2030 are between your additional upstream space stock opportunities, downstream growth projects in metals, magnets, including your JV organic, inorganic growth. Most importantly, how should we think about shareholder returns such as dividends? Thank you, Paul.

Chen Jiang: Good morning, Paul. Thank you for taking my question. My question is in regards to your capital allocation framework, if you have one. By looking at Lynas, your balance sheet, you have AUD 1.2 billion sitting at the bank after your equity raise last September. By looking at your cash generation over the next 12 months, I guess you will continue to build cash even though you have CapEx cycle. I am just wondering how the management team currently ranks the capital allocation priorities, because you have so many small projects like Towards 2030 are between your additional upstream space stock opportunities, downstream growth projects in metals, magnets, including your JV organic, inorganic growth. Most importantly, how should we think about shareholder returns such as dividends? Thank you, Paul.

Speaker #5: Good morning, Paul. Thank you for taking my question. My question is in regards to your capital allocation framework, if you have one. So, by looking at Lynas, your balance sheet has $1.2 billion sitting at the bank after your equity raise last September.

Speaker #5: And by looking at your cash generation over the next 12 months, I guess you will continue to build cash even though you have the current cycle.

Speaker #5: I'm just wondering how the management team currently ranks the capital allocation priorities, because you have so many small projects lined up through 2030. Between your additional upstream space, stock opportunities, downstream growth projects in metals, magnets, including your JV, organic and inorganic growth—and most importantly, how should we think about shareholder returns, such as dividends?

Speaker #5: Thank you, Paul.

Speaker #2: Thank you. That's a very good question. All the numbers in the yearly report include capex that is clearly, officially, and transparently decided. I just want to first say that, yes, we raised more than $900 million around a year ago, but that's for the five years to come.

Pol Le Roux: That is a very good question. All the numbers in the yearly report include CapEx that are clearly, officially, and transparently decided. I just want to first say that, yes, we raised more than AUD 900 million around a year ago, but that is for the five years to come, so until 2030. We are 12 months through or 10 months through. It is fair enough that we have not yet executed all the projects that we have in mind. These different projects that are under discussions, they are not included, because they are not fully defined or fully negotiated when it comes to external growth. The cash component is not known and therefore not included in our tables. I would say to summarize that, the CapEx for FY27, which is in the report, are basically the one investment that is decided, which is the heavy rare separation.

Speaker #2: So, until 2030. And we are 12 months through—or 10 months through. And it's fair enough that we haven't yet executed all the projects that we have in mind.

Speaker #2: So these different projects that are under discussion, they are not included because they are not fully defined or fully negotiated when it comes to external growth.

Speaker #2: So the cash component is not known and therefore not included in our tables. So we rank, I would say, to summarize that the capex for FY '27, which is in the report, is basically the one investment that is decided, which is the heavy rare separation.

Speaker #2: So how much we'll cash out next or this fiscal year on that. Plus, by priority, all the small, stay-in-business or productivity quick-win CapEx that we have in the pipeline.

Pol Le Roux: How much we will cash out next or this fiscal year on that. Plus, by priority, all the small stay in business or priority quick wins CapEx that we have in the pipe, so as to secure our production volume and further improve our cost position. The big ones, per definition, because they are not fully defined as we speak, cannot be shared and disclosed at the moment. We will make announcement as the other things develop.

Speaker #2: This is to secure our production volume and further improve our cost position. The big ones, by definition, because they are not fully defined as we speak, cannot be shared and disclosed at the moment.

Speaker #2: So, but yeah, we'll make announcements as things develop.

Speaker #1: The next question is from Austin Yun from Macquarie. Austin, please go ahead.

Operator: The next question is from Austin Yun from Macquarie. Austin, please go ahead.

Speaker #4: Good morning. Morning, Paul and team. My question is also on the 2030 strategy. Looking at that slide you have, you have the downstream capacity and expansion to metalization are kind of executed with different announcements.

Austin Yun: Morning, Paul and team. My question is also on the 2030 strategy. Looking at that slide you have, you have the downstream capacity and expansion to metallization all kind of executed with the different announcements. For the additional resources, yes, you finished the Mount Weld, but you continue to highlight this neo feed stock potentially for ionic clay. I do not know if it is correct to make the link to the term deposit. They still have 270 million. Just keen to understand for this particular part of the strategy, should we think about it in the next 12 months or something longer term after the succession plan is clarified or maybe after the environmental approval is settled with the Malaysian government? Any color on this front will be very helpful. Thank you.

Speaker #4: For the additional ore resources, yes, you finished the Mount Weld. But you continue to highlight this new free-to-stock potential for the clay.

Speaker #4: I don't know if it's correct to make the link to the term deposit. They still have, like, $270 million. Just keen to understand, for this particular part of the strategy, should we think about it in the next 12 months, or is it something kind of longer term—after the succession plan is clarified, or maybe after the environmental approval is settled with the Malaysian government?

Speaker #4: Any color on this point will be very helpful. Thank you.

Speaker #2: Well, thank you for the question. I think that we definitely need to increase the divestment of Serbian content in our field. The simplest, fastest way to do that is to accelerate the access, therefore modify— and that's what I discussed with the team yesterday— the mining plan of Mount Weld.

Pol Le Roux: Well, thank you for the question. I think we definitely need to increase the dysprosium content in our feed. The simplest, fastest way to do that is to accelerate the access, therefore modify, that is what I discussed with the team yesterday, the mining plan of Mount Weld, so as to access the dysprosium rich zone that we disclosed when we disclosed our last resource and reserve statement. That is the fastest because we do not need permitting. It is still mining in the same pit of Mount Weld. Process is not changed. It is simply execute that as fast as possible. There is a cost because we need to evacuate the other burden that we are not planning to evacuate so early. So it is additional mining costs or anticipated mining costs. That is under calculation and that will be disclosed in due course in a very near future.

Speaker #2: So as to access the Deva Serbian Ridge zone that we disclosed when we released our last resource and reserve statements. That's the fastest because we don't need permitting.

Speaker #2: It's still mining in the same pit at Mount Weld. The process has not changed. It's simply executing that as fast as possible. And there is a cost, because we need to evacuate the other burden that we're not planning to evacuate so early.

Speaker #2: So it's additional mining cost or anticipated mining cost. That will be that is under calculation and that will be disclosed in due course in a very near future.

Speaker #2: Besides that, we are looking at pure ionic clay options. And we have, basically, a lot of people with development projects from everywhere around the world coming and knocking on our doors.

Pol Le Roux: Beside that, we are looking at pure ionic clay options. We have basically a lot of people with development projects from everywhere around the world coming and knocking our doors. We are discussing with them what kind of a strategic agreement we could have, whether it makes sense for us and whether it makes an industrial sense, means a good complement to Mount Weld resource. Second, whether the environmental performance of these projects are in line with Lynas' strict policy on the matter. At the end of the day, if financially we can make a deal that makes sense to our shareholders. So, these are discussions are underway. As soon as any one of them would be finalized, it will be disclosed to market. It is a bit too early for that. But it has got nothing to do with succession plan or otherwise that you mentioned.

Speaker #2: And we are discussing with them what kind of a strategic agreement we could have, whether it makes sense for us, and whether it makes industrial sense—meaning, is it a good complement to the Montreal resource.

Speaker #2: Second, whether the environmental performance of these projects is in line with Lynas' strict policy on the matter, and at the end of the day, if financially, we can make a deal that makes sense to our shareholders.

Speaker #2: And so, these discussions are underway. As soon as any one of them is finalized, it will be disclosed to the market.

Speaker #2: It's a bit too early for that. But it's got nothing to do with succession plan or otherwise, as you mentioned. It's just a matter of timing.

Pol Le Roux: It is just a matter of timing. We are the 26 August. Could be not tomorrow, but yeah, soon.

Speaker #2: We are the August 26th. Could be not tomorrow, but yeah, soon.

Speaker #1: The next question is from Dim Ari Singer from UBS. Dim, please go ahead.

Operator: The next question is from Dim Ariyasinghe from UBS. Dim, please go ahead.

Speaker #4: Thanks, guys. Thanks, all. Good morning. Just a question on the sector's broader M&A trajectory and implications for you. So, Energy Fuels putting in a bid for Vacuum Smelts—how do you think about that in the context of your own sales book?

Dim Ariyasinghe: Thanks, guys. Thanks for. Morning. Just a question on the sector's broader M&A trajectory and implications for you. Energy Fuels putting in a bid for Vacuumschmelze. How do you think about that in the context of your own sales book? Did you sell to them? Will you still sell to them? Then, hypothetically, if that continues to happen, so you have more of your potential competitors buying downstream, how does that affect how you think about your sales book and then your downstream strategy, more broadly?

Speaker #4: Did you sell to them? Will you still sell to them? And then hypothetically, if that continues to happen—so you have more of your potential competitors buying downstream—how does that affect how you think about your sales book and then your downstream strategy more broadly?

Pol Le Roux: That is a very good question. The first remark I would make is that when you see competition growing, you should be happy, because if you have competitors, it means that you are playing in a very attractive market. So I am happy to see competition. Now what matters to us is to further deliver on the specific of Lynas. And the specific of Lynas is a track record, the supply ability, the predictive supply ability of Lynas, the quality of our products, the partnership with Japan, and with new players. So you cannot marry everyone. This year, we added JS Link to the list, LS Cable for metal. There will be more. And there is enough room for everyone. At the end of the day, what matters is not so much what on paper you build as an alliance, but how good a newly formed team can be to execute the strategy.

Speaker #2: That's a very good question. The first remark I would make is that when you see competition growing, you should be happy, because if you have competitors, it means that you are playing in a very attractive market.

Speaker #2: So, I'm happy to see competition. Now, what matters to us is to further deliver on the specifics of Lynas. And the specific of Lynas is track record.

Speaker #2: The supply BT, the predictive supply BT of Lynas, the quality of our products, the partnership with Japan and with new players. So you can't marry everyone.

Speaker #2: This year, we added Jess Link to the list on a scale for metal. There will be more. And there is enough room for everyone; at the end of the day, what matters is not so much what, on paper, you build as an alliance, but how good the newly formed team can be to execute the strategy.

Pol Le Roux: At the end of the day, what matters is not so much what on paper you build as an alliance, but how good a newly formed team can be to execute the strategy. We focus on the execution of our strategy more than worrying about how others would. So it does not change our plan, to answer your question.

Speaker #2: And so, we focus on the execution of our strategy more than worrying about how others would. So, it doesn't change our plan, to answer your question.

Pol Le Roux: We focus on the execution of our strategy more than worrying about how others would. So it does not change our plan, to answer your question.

Speaker #1: The next question is from Matthew Hope from Auden Minette. Matthew, please go ahead.

Operator: The next question is from Matthew Hope from Ord Minnett. Matthew, please go ahead.

Speaker #4: Oh, yeah. Thanks, Paul. I just wanted to follow up on something you mentioned during the call. It looks like you're considering recycling and adding more production to Kuantan.

Matthew Hope: Yeah. Thanks, Paul. I just wanted to follow up on something you mentioned during the call. Looks like you are considering recycling and adding more production to Kuantan. So I was just wondering, have you had any, at this stage, any sort of thoughts about the size or when this project might take place? Would it take more separation capacity or would it sort of just backfill what you already have? Just yeah, some more details on that project. Thanks.

Speaker #4: So, I was just wondering, have you had any, at this stage, any sort of thoughts about the size or when this project might take place?

Speaker #4: Would it take more separation capacity, or would it sort of just backfill what you already have? Just—yeah, some more details on that project.

Speaker #4: Thanks.

Speaker #2: That's a very good question. Two words. One on the recycling—because there is lots of communication, I would say, around recycling. There are two kinds of recycling.

Pol Le Roux: That is a very good question. Two words. One on the recycling, because there are lots of communication around recycling. There are two kinds of recycling. One is end-of-life magnets recycling, and the other is recycling of the swarf. The swarf are 30% of raw material or alloy that are wasted during the magnet-making process. When people talk about end-of-life magnet being the wonderful opportunity to secure critical material, I think there is a misunderstanding here. I will take example of car industry, which sees the majority of magnet usage today. A car lifetime is 15 years average. 15 years ago, there were 200 grams of magnets per car. Today, there is 2.5 kilograms of magnets average per car. So you see very easily that if you address the 200 grams of a smaller opportunity market 15 years ago to supply the existing market, you have a gap.

Speaker #2: One is end-of-life magnets—recycling. And the other is recycling of the swarf. The swarf is 30% of raw material or alloy that is wasted during the magnet-making process.

Speaker #2: When people talk about end-of-life magnets being the wonderful opportunity to secure critical material, I think there is a misunderstanding here. I'll take the example of the car industry.

Speaker #2: Which is the majority of magnet usage today. A car's lifetime is an average of 15 years. Fifteen years ago, there were 200 grams of magnets per car.

Speaker #2: Today, there is an average of 2.5 kilograms of magnets per car. So you see very easily that if you address the 200 grams of a smaller automotive market 15 years ago through supply to the existing market, you have a gap.

Speaker #2: So I think it's important to have the ability to recycle end-of-life magnets, but that will—it's more preparing for the future, because it will start to be substantial only after 2030.

Pol Le Roux: So I think it is important to have the ability to recycle end-of-life magnet, but that will it is more preparing for future because it will start to be substantial only after 2030. Important to have, not important to execute immediately. Whereas the swarf recycling is an immediate adapt and very important step for the competitiveness of the magnet maker. So a magnet maker who is not able to competitively recycle the 30% swarf cannot be competitive, and that is a service we offer. So we are in discussion with a number of magnet makers. JS Link, of course, being in Malaysia, will be the first, but there are others that are interested, and we are discussing that. The project is scoping the size of recycling. That would be a marginal investment adding to our existing facility, combining the heavies and the lights separation.

Speaker #2: It's important to have, but not important to execute immediately. Whereas the swap recycling is an immediate add-on and a very important step for the competitiveness of the magnet maker.

Speaker #2: And so, a magnet maker who is not able to competitively recycle the 30% swap cannot be competitive. And that's a service we offer. So we are in discussion with a number of magnet makers—JASS Link, of course, being in Malaysia, will be the first, but there are others that are interested.

Speaker #2: Then we are discussing that the product is coping with the size of recycling. That would be a marginal investment, adding to our existing facility, combining the heavies and the lights.

Speaker #2: When it comes to increasing the production size of land, land has substantial upside to increase its production capacity. I know that last year we mentioned 12,000 tons a year as a possible target.

Pol Le Roux: When it comes to increasing the production size of LAMP has substantial upside to increase its production capacity. I know that last year we mentioned 12,000 tons a year as a possible target. That is more related to how fast the market grows. What is important for us, there are two elements to consider. One, when you see how effective was the CapEx. We invested around AUD 100 million for so-called industrial plant in Kuantan, whereas we increased our production by 50%. We added up DY turbine production, all of this for AUD 100 million. That is very, very cost-effective, and we did that with a very smart modification of our solvent extraction system, which is now unique, very different, and we do not disclose how we modify that. So cost-effectiveness of capacity increase is, to us, very important.

Speaker #2: That is more related to how fast the market grows. What is important for us—there are two elements to consider. One, when you see how effective the CAPEX was.

Speaker #2: We invested around $100 million for the so-called industrial plan in Kuantan, whereas we increased our production by 50%. We added up DY turbine production.

Speaker #2: All of this for $100 million. That is very, very cost-effective, and we did that with a very smart modification of our southern extraction system, which is now unique.

Speaker #2: Very different, and we don't disclose how we modify that. So, cost-effectiveness of capacity increase is, to us, very, very important, and that will be a big element in making a decision on increasing further the size of land.

Pol Le Roux: That will be a big element in making decision on increasing further the size of LAMP in line with the market demand. So LAMP could go very far. We may also consider at some stage to have another site, I do not know. We have time to think of it. But potentially, LAMP has the potential to grow a lot, in terms of size, and we will grow that as the demand justifies.

Speaker #2: In line with the market demand, land could go very far. We may also consider, at some stage, having another site. I don't know.

Speaker #2: We have time to think about it. But potentially, land has the potential to grow a lot in terms of size, and we'll grow that as the demand justifies.

Speaker #1: The next question is from Rahul Anand from Morgan Stanley. Rahul, please go ahead.

Operator: The next question is from Rahul Anand from Morgan Stanley. Rahul, please go ahead.

Pol Le Roux: Hello?

Speaker #2: Hello?

Speaker #1: We will go to the next caller. The next caller is Mitch Ryan from Jefferies. Mitch, please go ahead.

Operator: We will go to the next caller. The next caller is Mitch Ryan from Jefferies. Mitch, please go ahead.

Speaker #3: Thank you for taking my second question. As part of your environmental approvals, I believe you've committed to spending 1% of gross revenue on thorium extraction development at LAMP.

Mitch Ryan: Thank you for taking my second question. As part of your environmental approvals, I believe you have committed to spending 1% of gross revenue on thorium extraction development at LAMP. Out to 2031, which I think is roughly AUD 100 million. What progress has been made on that? Do you remain committed to that program, and is the spending commitment unchanged?

Speaker #3: Out to 2031, which I think is roughly $100 million. What progress has been made on that? Do you remain committed to that program, and is the spending commitment unchanged?

Mitch Ryan: Out to 2031, which I think is roughly AUD 100 million. What progress has been made on that? Do you remain committed to that program, and is the spending commitment unchanged?

Speaker #2: Yes, that's a very good question. We have achieved very good results at the pilot scale with a modified cracking process, where the thorium and uranium are extracted out of the cracking machine.

Pol Le Roux: Yes, that is a very good question. We have achieved very good results at the pilot scale, with a modified cracking process, whereas the thorium and uranium are extracted out of a cracking leaching. That is one element. What we are working on at the moment is to, I would say, change the vision of process. Instead of extracting only what you want from the raw material you have, making sure you extract everything that has any value from anything you take from the ground. Very simple. Thorium may have commercial applications, but you also have scandium, you also have phosphate, and we continue the process, and we have lots of R&D program on that to actually be able to produce and value every single product and elements that is in the concentrate that feed cracking leaching.

Speaker #2: Now, that’s one element. What we are working on at the moment is, I would say, to change the vision of processing. Instead of extracting only what you want from the raw material you have, making sure you extract everything that has any value from anything you take from the ground.

Speaker #2: So very simple. Thorium may have commercial applications. But you also have scandium. You also have phosphate, and so we fine-tune the process and we have lots of R&D programs on that to actually be able to produce and value every single product and element that is in the concentrate that feeds the cracking machine.

Speaker #2: So, we are in the process of building an industrial pilot plant and testing all the developments that have been done around the world on this program.

Pol Le Roux: We are in the process of building an industrial pilot plant and test all the developments that have been done around the world on this program. We will see from there. It is R&D program, so in a year time, we should have further results on that. 2031 is a challenging date, but not impossible. At the end of the day, for us, what matters is to make sure that such a process change would be profitable for Lynas. So we need to maximize the return, is both into improving recoveries of lights, heavies, valuing all elements within this process, so that at the end of the day, we find a process that is improving further the cost position of Lynas, at the same time addressing the environmental consideration of Malaysia. It is a great project, actually.

Speaker #2: And we'll see from there; it's an R&D program. So, in a year's time, we should have further results on that. 2031 is a challenging date, but not impossible.

Speaker #2: At the end of the day, for us, what matters is to make sure that self-process change would be profitable for miners. So we need to maximize the return.

Speaker #2: This goes into improving recoveries of lights and heavies, valuing all elements feeding this process, so that at the end of the day we find a project that is further improving the cost position of miners, while at the same time addressing the environmental considerations of Malaysia.

Speaker #2: It's a great project actually.

Speaker #1: The next question is from Jonathan Sharp from JP Morgan. Jonathan, please go ahead.

Operator: The next question is from Jonathon Sharp from JPMorgan. Jonathan, please go ahead.

Speaker #3: Yeah, thanks for taking my second question. Paul, you've historically talked about the ramp-up in terms of tons per day. On my numbers, second half production averages around 21, 21 tons per day.

Jonathon Sharp: Yeah. Thanks for taking my second question. Paul, you've historically talked about the ramp-up in terms of tons per day. On my numbers, H2 production average is around 21 tons per day. I believe you're working towards 25. Can you just maybe let us know where did you end the year and where do you want to get to through FY27?

Speaker #3: I believe you're working towards 25. Can you just maybe let us know where you ended the year and where you want to get to through FY27?

Speaker #2: That's a very good question. We have two ways to consider that. One is the formal consideration, which is called the best demonstrative performance.

Pol Le Roux: It's a very excellent question. So we have two ways to consider that. One is, it's the formal consideration. It's called a best demonstrated performance, and this is something you measure, let's say, over three, five days average, because how high can you go in terms of daily production? This differs at each stage of the process. So, what we target on SX or NdPr Finishing in Kuantan is 30 tons or even 33 tons a day. At the moment, we have demonstrated that we are able to get 30 tons a day, over several days, so that's great achievement. We need to further develop to move up to 33 tons a day. Cracking leaching in Kuantan has been very amazingly performing last fiscal year. So we had up to 31 tons a day at some stage. But again, don't be too excited. This is exciting, but problems occur.

Speaker #2: And this is something you measure, let's say, over a three- to five-day average, because how high can you go in terms of daily production? And this differs at each stage of the process.

Speaker #2: So what we target on the SX or NPF in Quantan is 30 tons, or even 33 tons a day. At the moment, we have demonstrated that we are able to get 30 tons a day.

Speaker #2: Over several days, so that's a great achievement. And we need to further develop to move up to 33 tons a day. Cracking and leaching in Kuantan has been performing amazingly over the last fiscal year.

Speaker #2: So, we had up to 31 tons a day at some stage. But again, don't, I mean, don't be too excited. This is exciting, but problems occur.

Speaker #2: You have power shutdowns. You have breakdowns. You have regular maintenance, preventive maintenance, etc. So you can cut it off by reliability of equipment and external factors.

Pol Le Roux: You have power shuts, you have breakdowns, you have regular maintenance, preventive maintenance, et cetera. So you can cut it off by reliability of equipments and external factors, which currently brings us to where we are. We have delivered on FY26. The quality variations on Mount Weld concentrate was one of these elements that was very frustrating to the team because it impacted directly the cracking leaching, both in Kuantan and Kalgoorlie performance. So this is now way better addressed. But, yes, we follow that it's very important two aspect on capacity. One is the best demonstrated daily capacity over a few days time at each step of the process, and I think that we are pretty well on that. The other is improving the reliability, including reducing your exposure to external factors.

Speaker #2: Which currently brings us to where we are. We have delivered on FY26. The quality variations on multiple concentrate was one of these elements. That was very frustrating to the team because it impacted directly the cracking leaching, both in Kuantan and Kalgoorlie performance.

Speaker #2: So this is now way better addressed. But yeah, we follow that best. It's very important, two aspects on capacity. One is the best demonstrated daily capacity over a few days' time.

Speaker #2: At each step of the process. And I think that we are pretty well on that. And the other is improving the reliability, including reducing your exposure to external factors.

Speaker #2: That includes, included in the FY26, sometimes a shortage of chemicals that we were sourcing from China and then all of a sudden it was not possible to source.

Pol Le Roux: That included in the FY26, sometime shortage of chemicals that we were sourcing from China and then all of a sudden was not possible to source, or other external factors like the famous power supply to Kalgoorlie. But there are things that we need to take into account as well, because at the end of the day, the production performance is combination of how high you can go at your best versus how long you can run. And sometimes you need to be a champion for 100 meters and marathon at the same time. That is the challenge.

Speaker #2: Or other external factors, like the famous power supply to Calgary. But then there are things that we need to take into account as well, because at the end of the day, the production performance is a combination of how high you can go at your best versus how long you can run.

Speaker #2: And sometimes you need to be—you need to be a champion for the 100 meters and the marathon at the same time. So that's the challenge.

Speaker #1: The next question is from Paul Young from Goldman Sachs. Paul, please go ahead.

Operator: The next question is from Paul Young, from Goldman Sachs. Paul, please go ahead.

Speaker #3: Yeah, hi. Thanks again. Paul, I don't want to get caught up too much in the near term, but just on FY27, where you said that production should be fairly higher.

Paul Young: Yeah. Hi, thanks again, Paul. Paul, I do not want to get caught up too much in the near term, but just on FY27 where you said that production should be fairly higher than FY26. You stepped through Mount Weld's running better. The downstream capacity, you just outlined can do a level or so, but that is without the maintenance shuts, et cetera. But just looking at FY27, are you planning on ramping up in line with demand and sales contracts, or are you planning on actually ramping up faster than you can sell and you will carry the inventory on the balance sheet? Or can your customers actually pre-pay for your material like, for example, we have seen with MP?

Speaker #3: Then FY26, you've stepped through Mount Weld's running about at a downstream capacity. You just outlined Kandu level or so, but that's without the maintenance shuts, etc.

Speaker #3: But just looking at FY27, are you planning on ramping up in line with demand and sales contracts, or are you planning on actually ramping up faster than you can sell, and you'll carry the inventory on the balance sheet?

Speaker #3: Or can your customers actually prepay for your material, like, for example, we've seen with MP?

Pol Le Roux: Okay. Basically, the FY27, Mount Weld is able to deliver as much as Kalgoorlie and LAMP can swallow. As I said, the key focus for us are making sure we keep control, which is the case now, but we need to keep control on the quality of concentrate produced by Mount Weld so that the productivity of cracking leaching in both LAMP and in Kalgoorlie are not impacted. That is a very important element. The other element obviously is to and that is why I spend these days in Kalgoorlie, but making sure we execute the necessary last few detail modifications in Kalgoorlie for us to maximize the production in Kalgoorlie. And we have one element, which matters a lot in LAMP. You know that every year, the second quarter, we are a bit limited by the allowance of the concentrate we can crack in Malaysia.

Speaker #2: Basically, in FY27, Mount Weld is able to deliver as much as Kalgoorlie and LAMP can process. As I said, the key focus for us is making sure we keep control, which is the case now, but we need to keep control of the quality of concentrate produced by Mount Weld so that the productivity of cracking and leaching in both LAMP and Kalgoorlie are not impacted.

Speaker #2: That's a very important element. The other element, obviously, is to—and that's why I spend these days in Calgary—make sure we execute the necessary last few detail modifications in Calgary so as to secure and maximize the production expert, really.

Speaker #2: And we have one element which matters a lot in LAB. You know that every year, in the second quarter, we are a bit limited by the allowance of concentrate we can crack in Malaysia.

Speaker #2: So we're still working with the regulators here to increase that to 110. That would deliver a lot more production for us, since every year, normally, we focus on concentrating maintenance during that time. But we wish to make profit of that period of time to produce more.

Pol Le Roux: We are still working with the regulators here to increase that to 110. That would deliver a lot more production for us, since every year normally we focus on concentrating maintenance during that time, but we wish to make profit of that period of time to produce more. That will be the element for us to maximize our production. I would say, it is more linked to investor performance this year because we have still some issues to fix rather than demand.

Speaker #2: So that will be the element for us to maximize our production. I would say it's more related to industrial performance this year, because we still have some issues to fix rather than the demand.

Speaker #1: The next question is from Chin Jiang from Bank of America. Chin, please go ahead.

Operator: The next question is from Qin Zhang from Bank of America. Qin, please go ahead.

Qin Zhang: Thank you for taking my follow-up question, Paul. My question is a follow-up from the answers you provided earlier to my first question. You mentioned various projects under discussion. I am wondering, is that more like a timing issue or because of the previous CEO, Amanda, has left by end of FY26? Because it has been 12 months since the equity raise. Are you being able to elaborate on that? Also what is your view on the inorganic growth, especially for your upstream feedstock? For the new ionic clay, I guess you are open for the inorganic growth, given you signed the agreement with one of the Malaysia government and, ionic clay is rich in Malaysia. Thank you.

Chen Jiang: Thank you for taking my follow-up question, Paul. My question is a follow-up from the answers you provided earlier to my first question. You mentioned various projects under discussion. I am wondering, is that more like a timing issue or because of the previous CEO, Amanda, has left by end of FY26? Because it has been 12 months since the equity raise. Are you being able to elaborate on that? Also what is your view on the inorganic growth, especially for your upstream feedstock? For the new ionic clay, I guess you are open for the inorganic growth, given you signed the agreement with one of the Malaysia government and, ionic clay is rich in Malaysia. Thank you.

Speaker #4: Thank you for taking my follow-up questions, Paul. My question is a follow-up to the answers you provided earlier to my first question.

Speaker #4: You mentioned various projects' discussion. I'm wondering, is that more of a timing issue, or is it because of privacy, or has Amanda left by the end of FY26?

Speaker #4: Because it's been 12 months since the equity raise, you've been able to elaborate on that. Also, what's your view on the inorganic growth, especially for your upstream phase stock for the new R&D clay?

Speaker #4: I guess you are open to inorganic growth, given you signed the agreement with one of the Malaysian government entities and R&D clay is reaching Malaysia.

Speaker #4: Thank you.

Pol Le Roux: Well, thanks, Sushan. I understand you are frustrated because we do not spend fast enough our money, or your money. But it is just 12 months. It may sound very long to you, but it is not that simple. We really need to seriously assess the quality, the economics of potential resources, the permitting situation, because, for a lot of projects for ionic clay, it is in countries where the regulation is not existing or not satisfactory, and we are very careful about that. Finally, make a deal that is economically sound for our shareholders. It is nothing to do with succession planning or whatever. I mean, Lynas and the team keeps working very hard on that, on a number of projects. If I take the Mount Weld resource development, that is now 100% in the hands of Lynas. It is a complex work to readjust your mining plan.

Speaker #2: Thanks, Christian. I understand you're frustrated because you feel we're not spending our money, or your money, fast enough. But it's just 12 months. It might sound very long to you, but you know it's not that simple.

Speaker #2: We really need to seriously assess the quality, the economics of potential resources, and the permitting situation, because for a lot of projects— for any clay—the regulation is not... it's in countries where the regulation is not existing or not satisfactory.

Speaker #2: And we are very careful about that. And finally, make a deal that is economically sound for our shareholders. So, it's nothing to do with succession planning or whatever.

Speaker #2: I mean, Linus and the team keep working very hard on that, and on a number of projects. And if I take the Mount Weld resource development, that is 100% in the hands of Linus. It is a complex work to readjust your mining plan.

Speaker #2: I was challenging the team as usual yesterday, saying, "How can we go faster?" etc. It is not that simple. You need to mobilize a lot of resources to change your mining plan.

Pol Le Roux: I was challenging the team as usual yesterday, saying, "How can we go faster?" It is not that simple. You need to mobilize a lot of resources to change your mining plan. That is for the high dysprosium-yttrium content. The other one is the carbonatite, for which we have a very high expectation. This is all about not only further characterization of the resource, but also optimizing the processing concentration step and cracking step of such resource. It is a lot of efforts on R&D for that prior to declare that zone as a reserve. I am sorry. I am like you, I wish that everything was done yesterday, but sometimes we need to be realistic. Trust me, we are very careful to make sure that the money is spent wisely.

Speaker #2: And that's for the high device content. The other one is the carbon type, for which we have very high expectations, but this is all about not only further characterization of the resource, but also optimizing the processing, concentration step, and cracking step of such resource.

Speaker #2: So it's a lot of efforts on R&D for that prior to declaring that zone as a reserve. So, I'm sorry—I wish I'm like you.

Speaker #2: I wish that everything was done yesterday. Sometimes, we need to be realistic. Trust me, we are very careful to make sure that the money is spent wisely.

Speaker #2: And yes, sometimes it's wise to think deeply about projects rather than go ahead and then realize that we ignored some aspects of the deal or the opportunity.

Pol Le Roux: Yes, sometimes, it is wise to think through deeply on the project rather than go ahead and then realize that we ignore some aspects of the deal or the opportunity. Sorry. I hope that in the near future, we come back to you with some more announcement. Just JS Link, LS Cable, and Noveon is quite the achievement in the last 12 months. There will be more to come. That is all I can say. They are all on the discussion.

Speaker #2: So, sorry, I hope that in the near future we'll come back to you with some more announcements, but just less cables and Navion is quite the achievement in the last 12 months.

Speaker #2: There will be more to come. That's all I can say. And they are under discussion.

Operator: The last question comes from Daniel Morgan, from Barrenjoey. Daniel, please go ahead.

Speaker #1: The last question comes from Daniel Morgan from Baron Joey. Daniel, please go ahead.

Daniel Morgan: Well, hi, Paul. My question is just a simple one. If we look back when results are presented in a year's time, what would successful outcomes be? What are the key things that the company wants to achieve in the next 12 months? Thank you.

Speaker #5: Well, hi Paul. My question is just a simple one. If we look back when results are presented in a year's time, what would successful outcomes be?

Speaker #5: What are the key things that the company wants to achieve in the next 12 months? Thank you.

Pol Le Roux: If you look back into our mindset, our expectations, or achievement in FY26 versus what we were expecting beginning of FY26, I would say overall, I am very happy. We are pretty happy overall by how fast things went. A little bit disappointed, of course, by the production volume because of this quality issue we faced in the last quarter, which is for the whole team frustrating. But anyway, that is life. No reason to complain, just address and learn from that and make sure it does not repeat again. On the other hand, the development, the heavies, the Ytterbium commercial, and the way it was received by the market is even more positive than expected. That is the reason why we need to further accelerate on that. The samarium production was delivered earlier than expected, so that is great.

Speaker #2: If you look back into our mindset or expectations for achievement in FY26, versus what we were expecting at the beginning of FY26, I would say overall I'm very happy.

Speaker #2: We are pretty happy overall with how fast things went. A little bit disappointed, of course, by the production volume because of these quality issues we faced in the last quarter, which is, for the whole team, frustrating. But anyway, that's life.

Speaker #2: No reason to complain, just address and learn from that, and make sure it does not repeat again. On the other hand, the development of the heavies commercial and the way it was received by the market is even more positive than expected.

Speaker #2: And that's the reason why we need to further accelerate on that. The summary on production was delivered earlier than expected, so that's great. And at the end of the day, with safety, we were quite concerned with last year's safety performance.

Pol Le Roux: At the end of the day, the safety, we were quite concerned with the last year safety performance. The safety performance of this year has been just cutting by half the LTI, which is a very important aspect of performance of the team. As I said, and for me, not numbered, but I have 25 years experience in this business. Today, when I go around with the team, be it Mount Weld, Kalgoorlie, Kuantan, which is on top of the game, and the R&D team, I feel a level of expertise and engagement that I have never perceived in the past several years. That to me, makes me very comfortable for future. Yeah. That is achievement mainly of 2016.

Speaker #2: The safety performance this year has included cutting the LTI by half, which is a very important aspect of the team's performance.

Speaker #2: So as I said, for me, not numbered, but you know I have 25 years' experience in this business. Today, when I go around with the team—be it Mount Weld, Kalgoorlie, which is on top of the game, and the R&D team—I feel a level of expertise and engagement that I have never perceived in the past several years.

Speaker #2: And that, to me, makes me very comfortable for the future. Yeah. And that's an achievement mainly of 2026.

Operator: Thank you. There are no further questions. I will now hand back to Paul for closing remarks.

Speaker #1: Thank you. There are no further questions. I will now hand back to Paul for closing remarks.

Speaker #2: Okay, thank you very much, all, for this very interesting discussion. I hope that you are all convinced, as I am, that Lynas is very well equipped and has delivered pretty good results in '26, but as I said, most important, is perfectly equipped to seize any opportunities in the near future.

Pol Le Roux: Okay. Thank you very much all for this very interesting discussion. I hope that you are all convinced, as I am, that Lynas is very well-equipped, has delivered pretty good results in 2026, but as I said, most important to me is perfectly equipped to seize any opportunities in the near future and deliver further growth. Thank you very much all.

Speaker #2: And deliver for the growth. Thank you very much, all.

Operator: That concludes today's call. Thank you for joining us. You may now log out.

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