A couple of points here. Obviously, most of the presentation will be about Kimberley Mineral Sands as always, particularly the the the quarterly production report.

Just wanted to highlight on the other two assets. On South Atlantic, recognizing the the, the need to preserve cash to support or potentially support Kimberley Mineral Sands, we've reached an agreement with the shareholders of the South Atlantic project where we will stop funding activities for now, the other shareholders will provide funding to the extent it's required.

In doing so, we've we've agreed with them to retain the option if we complete the or effectively pay in the full $15 million US dollars, including what we've already paid, we would acquire the 20%. We've we've reduced that as a as a, let's say, near-term cash outlay.

On Tapira, which is Capital Metals' interest, we actually sold that holding last week basically in the market as a block trade for a gross return, gross proceeds of about A$4 million. While we like the project and see that it has, a lot of potential and, certainly potential for more value than that in the future, again, we felt that it was more appropriate for us to have that cash in Sheffield Resources to the extent it may or may not be required to support Kimberley Mineral Sands.

We took the chance to sell that stake. We did make a a gain on on that on that position.

That's sort of corporate-ly. Obviously, main focus continues to be on Kimberley Mineral Sands and the Thunderbird Mine.

Just in terms of kind of what things look like on-site at the moment, the picture on the left is the usual picture of mining is a actually in the process of just finishing one mining block and moving to the next. That's the block that's currently being mined now.

That was the block just being finished when this picture was taken. These this sort of wall and this this here is the the wall we're building for the in-pit tailings using predominantly the oversize off the back of the mining unit.

That work continues. A sense of what the pit looks like at the moment.

Then on the right-hand side is the process plant with ilmenite stockpiles in the foreground. Nothing that's changed here.

You can see a bit of water on the ground. We've seen a wet season and that's part of our normal operations.

The business plan. May recall in March last year, we came up with a revised plan, which primary point of was to increase the mining rate to 16 million tonnes by the first quarter of next financial year.

Effectively, the September quarter of this year, 2026 calendar year. The core elements were were around, first of all, lifting drill and blast capacity to enable an increase in mining rate.

Then ultimately, that would result in at or above the original design concentrate production. I think we've talked about it previously, but definitely we've now seen the the waste mining with drill and blast in the new fleet is is achieving a very good productivity.

We're very comfortable that the waste mining is now will not be a constraint on the mining activities. We've, and we'll talk about this when we look at the last quarter the last quarter results, the the biggest push now is on on effectively increasing the the productivity and availability of the mining equipment.

We have made changes continue to make changes to the DMU. We are, working continually on improving that reliability.

We had some mobile equipment issues, particularly late in the quarter, which the contractor has been addressing, but ultimately that's what caused us to have a down quarter-on-quarter, but overall we still believe we're on track to deliver that enhanced mining rate by the middle of this year. That's partly driven by the fact we had always anticipated a a relatively flat change in the mining, and then with an acceleration in this March quarter and the June quarter, and we certainly still believe that that is is is possible.

Just looking at the specific sort of key performance metrics, blue is the ore mined, green is the rougher head feed, and and the the dotted brown line is is the grade mined. You can see that after a couple of quarters of building up of of mine performance, the December quarter was pulled back a little bit.

A mixture of some, as I said, some availability issues, but also some seasonal weather impacts, particularly late in the quarter. We did have the first tropical cyclone in in in late December.

We mined some lower grade zones as well, which partially impacted rougher head feed production. Overall, still believe we're on track to deliver the the plan from a mining perspective.

In terms of process plant, the recoveries of the two main products, zircon in green, TiO2 for, well, ZrO2 for zircon in green and TiO2 for ilmenite in blue, recoveries have been fairly steady in recent times as we've maintained fairly steady production. The recoveries are, or the process plant itself is impacted a little bit by variability of mining and so ultimately what we're trying to do is get to a steady delivery of feed, which helps the performance of the plant.

We continue to get pretty consistent quality of the two main products, again in terms of ZrO2 for zircon concentrate and titanium dioxide in the ilmenite concentrate. Just in terms of ore production, again looking at just, the quarter-on-quarter-on-quarter, the second quarter, the December quarter, was similar to the June quarter of of last year, a little bit down on September.

As I said, mainly driven by that reduced availability, reliability of the mining equipment, and we have maintaining and still believe that there's no reason why we can't mine at that equivalent of up to 4 million tonnes per quarter. As required, we don't believe we need to mine 4 million tonnes every quarter to keep the plant full, but we do need to build up and obviously prove that we have that capability over the next couple of quarters.

In terms of zircon concentrate production and sales, in Q2, production down a little bit, again mainly driven by lower effectively rougher head feed flowing through. We actually made reasonable shipments.

We had a carryover shipment from the September quarter, and we did catch up some sales. Albeit with this, there was a little delay of there was a part of a shipment delayed at the end of December.

A pretty good quarter from a sales perspective despite the weak market. That was partly driven by making shipments to our partner, Yansteel, of zircon concentrate as well as ilmenite concentrate in the quarter.

In the current quarter, we're expecting production to be, similar or or or higher. We have a bit of a bit of variability in there, partly partly at least in June, this is the quarter where we expect the biggest weather impact over a year, there is more inherent variability in the first quarter production and potentially sales as well, given the need to, shipments are also impacted by weather.

We allow for a little bit of variability in the current quarter, and we expect to sell, pretty much what we produce, albeit that the timing of shipments can can can vary a little bit. We sometimes, depending on when the shipment is, may not ship everything exactly in the same quarter as it's produced.

Still building towards, again, as we as we get to fill the process plant, then we'd expect to be in that sort of 55 circa 55,000 tonnes per quarter of zircon production sometime aiming for the first quarter of the next financial year. Ilmenite, a fairly similar story.

Production down on lower ore mining. There was a larger deferral of ilmenite shipment because of the the weather event loading at the end of the year.

The sales were impacted by that. We expect to catch that up in the current quarter.

Again, production similar, a little bit higher, depending exactly on what happens with weather, and then building to that sort of circa 220,000 tonnes a quarter of production from the first quarter of the next financial year. Cash costs.

We are seeing, well while we saw a small increase in in in this in the second quarter, partly driven by lower volumes, we have seen that the higher production rates and some of the other cost-saving initiatives are reducing the overall cost base. We're we're pretty pleased with this so far.

As always, there's more more to do, and we and the KMS team continue to look for opportunities to save cost wherever they can. There have been some some interesting opportunities identified, some of which have been delivered and and some of which are still are still to be delivered.

Even some of those delivered may not yet have fully impacted these costs depending on the timing of when they were implemented. Then cash flow perspective for that quarter, we did have negative operating cash flow for the quarter.

That's partly driven by timing of shipments and payments. Cash both outgoings and in-going and incoming can be impacted by the timing of when payments are made, but we did have negative in the quarter.

That negative operating cash flow, CapEx, and and interest, the interest and leases there was not interest to debt holders as that was deferred at the end of the quarter. That's lease payments associated with various items of leased equipment, and the operating deficit was made up by a combination of prepayments and the equity injection undertaken by both shareholders together in the in November of about A$6.5 million.

We did end with some reasonable inventory. The zircon inventory, particularly considering the small deferral of shipment, is about as expected.

The ilmenite shipment a little the ilmenite inventory a little bit higher, more impacted by the deferred shipment in the at the end of the quarter. Overall, had that ship left on time, our inventory is round around about normal levels that we would expect to sustain in operations.

I think that's sort of all I've got to say operationally. Just before I hand over to Peter for some questions, just a couple of comments on, I guess, both the debt restructure and the debt ownership.

Obviously, we announced that Shenghe, which is a a related party, part of the Yansteel group, had acquired the debt from Orion, the the the Orion loan note, and during January. We've got the debt restructure discussions continue now with NAIF and the new debt counterparty being Shenghe.

Those discussions are incomplete, and, obviously we've said what we've been able to say so far about the debt restructure and Shenghe, it's very difficult to provide any additional sort of commentary or whatever given essentially those sorts of discussions are they're done They're not done until they're done. Until we have something that we can say, we we we won't be in a position to say anything.

Thanks, Peter.

Brilliant. Thank you, Bruce.

Right, just for everyone watching, if you do have questions, please submit them via the Q&A section, and we'll obviously get round to the ones that we can. On the debt restructure, and I think, like Bruce just said there, can't really say anymore until the deal's done, I know a few questions have come through on that already.

In terms of looking through first question that's come through, in terms of zircon prices, Bruce, obviously, you've TZMI background and whatnot, and background in China, what's the forecast looking like? Even from my perspective, obviously, we have Chinese New Year coming up in what, 2, 3 weeks.

Is that going to make a big difference in the coming quarter that we're in now?

Yeah. Look, probably a couple of comments around pricing, and I think we said this in the quarterly, and others have made similar observations, I think including Iluka with their results announcement last week, is that we, like others, have seen some signs that prices stabilized certainly in the fourth quarter.

Prices were continuing to go down, albeit that overall we didn't see a lot of decline quarter-on-quarter. We had some variation based on switching some sales from delivered to free on board.

I think the general view is that the market had sort of stabilized around current levels with an open question about what happens next. I think Chinese New Year is, as everybody's probably aware, is pretty important in the China market.

Typically one of two things: you do sometimes get restocking prior to Chinese New Year, and we actually saw that last year. That seems to be less of an issue this year at the moment.

Often post-Chinese New Year, there is a certain amount of shipping and production based on it's a new year and there are new views. We'll wait and see.

I think I would describe probably the general view is that we're at or near the bottom of the market, of the zircon market in particular in China, but typically cycles in mineral sands tend to be a little bit slower than some other commodities, and so certainly may be at these levels for a while. At this stage, we would expect, certainly through the first half of this year, we certainly don't anticipate a rapid recovery in price in that time, and more likely to be some variation of where we are now.

Brilliant. Thanks, Bruce.

Another question here. Do you think another DMU would be helpful?

Because I know it's a question that's been brought up quite a lot in the past. Is that still a consideration, do you think?

Look, it is something that, yeah, is discussed. The possibility of having a second DMU could increase uptime.

It is a significant amount of capital, and given the current DMU and fleet should be capable of doing it, all options continue to be on the table. At this stage, the view still would be that a second DMU is more likely to be required when, ultimately as part of grade decline eventually to sort of increase mining rate to keep the plant full later in life rather than as a solution to the short-term availability.

We don't believe there is anything inherent in the DMU that means it can't operate at that level. There's been a bit of learning by doing in terms of the task, and potentially some need for some maturing of the approach to maintenance in some of that equipment, alongside the contractor in terms of getting the balance between preventative and breakdown maintenance right.

Where we've changed components out to align them better with the duty, generally we've seen those things have a positive impact. It's then what are the new failures, and are things being run to failure rather than being replaced before failure and some of those sorts of considerations.

Okay. Another question here.

How much of the price drop from, say, around $526 per tonne US to around $466 was due to the CIF/FOB differences? What do you think the comparative price is just based on CIF?

Look, comparative price on a CIF basis would be around $500 a tonne if we were selling everything at CIF. I'd say around probably 5, somewhere in the low $500s, somewhere between $500 and $510.

It does depend a little bit on the quality of individual cargoes, so as the content varies up and down. Probably about more or less half of the difference is probably due to the selling mix versus underlying price difference.

Okay. How does debt novation address issues with FIRB given the security of a project?

Look, we've said what we can say, but the loan was novated in its entirety. None of the terms have changed.

The changing of the ownership of the loan doesn't in and of itself change any of the terms and conditions of the loan. What it does change is the parties that are sitting at the table to renegotiate the loan.

The novation itself hasn't changed the debt situation at KMS.

Okay. Right, we're running low on questions here, if anyone does have any more, please submit them now.

There's one from me, Bruce. Obviously, you were talking, I think it sounded like you were pretty optimistic with the mine waste management side of things and how that was going, but production was down for the quarter.

Are you still pretty happy and, I guess, confident on the new business plan that you've released last year?

I think, as I've said, we continue to believe that is the right plan and that it's deliverable. I think in the detail of the plan, I got the question quite a lot last year about why was it going to take so long anyway.

We'd always envisaged that probably the second half of 2025, sort of the first half of the plan period, was really about some of the changes in mining and consolidating that, we were not expecting the sort of upturn in the first half. We were expecting things to improve, but we really needed to get ahead on waste mining.

We've got there now. That's not to say my preference would have been that the December quarter would have built on the September quarter.

That would have been a better outcome. We're not actually particularly out of line with the plan we had at the start of last year, and the key now is to make sure that KMS alongside our mining contractor can deliver that increase in mining rate over the next couple of quarters, which is when we had originally anticipated we would do that.

Okay. Then just in terms of obviously you do move around where the DMU is in the pit, etc., and grades differ.

How long until it moves again? Do you have any insight in terms of what the next place that DMU is moved into, what the grade is like, any differences there at all?

Typically just in simple terms, the DMU moves roughly once a month. The mining blocks are more or less 1 month, it's not exact, but that's a pretty good way to think about it.

If we mine faster, it'll be slightly quicker than that. The variation block on block, it does depend a little bit on sometimes you're just moving to the panel next door, and then there can always be some variability, but not much.

If you move around the corner and you're on a different face in the mine, which you do from time to time, then that can vary a little bit more. Every block also, as we mine the profile, there is a profile in the ore from the top to the bottom, there is a grade and mineral composition variation.

Effectively over the course of the block, you get the average grade and the average production, but it does vary throughout. Sometimes we see that variability as well.

When we go into a new block, we see certain grade and mineral performance, and then as you work your way down through the block, that changes, and then you get it again on the next block.

Okay. Interesting.

Another question here. When assessing the project metrics, should investors compare average sale price against C1 costs excluding or including inventory?

Look, my personal approach is I focus on C1 costs excluding inventory, because fundamentally the in and out of inventory is whether you book it into inventory or not. At the end of the day, the C1 costs without inventory is what it's costing you to make the product you made, and over time, you need to sell them for more than they cost you to make or you're not going to make money.

I find the one that I sort of focus on is the cash costs without inventory movement as being probably the most meaningful measure of what the cost of production actually is, without kind of backing out the, "Well, I sold more ilmenite," or "Did I build more zircon into inventory versus ilmenite?" It'll have a different impact on that inventory adjusted cost.

Now,

obviously over extended periods, it doesn't make any difference, because over a year or whatever, it makes less difference. When you're looking at a month, in our case internally, or as a quarter as an investor, I think the without inventory is probably the more meaningful of the two.

Okay. In terms of the variability in the rougher head feed grade, is that as expected, or has that been a bit of a surprise?

There's elements of it which are as expected, because no ore body is perfectly homogeneous. There are also times where we've made decisions to mine more of the lower grade T1 material at the top of some zones where we believe there'll be more zircon, etc.

In some cases, that is as expected, but not necessarily, you've made a deliberate decision to do that. Ultimately, the grades we see in the process plant are what we'd expect given the block we're mining, or how we've chosen to mine the block.

If you take a bit more low-grade material, you see lower grade, but that's as expected.

No, that makes sense. Good.

There is a question, I'm not sure how relevant it would be, Bruce, but the agreement with the US for rare earths, does that have any impact on Sheffield at all?

Not really. It's useful, but a fairly small part of the value of both the paramag and non-mag concentrates.

Ultimately, we're selling rare earth credits or monazite credits in another concentrate. They're all going to China at the moment, I think the sort of US piece is not super relevant there for us at the moment.

KMS continues to look at opportunities to sell those products outside of China as well. As we all know, one of the challenges there is where is the processing capacity?

In our case, you need someone who can process the concentrate. It's not about, we don't make monazite that someone could process to make rare earths.

We make concentrates that predominantly contain titanium minerals and/or zircon minerals with small amount of monazite credits in them. Whoever buys those needs to be able to process and remove the primary minerals before they can do anything with the monazite.

Okay. Interesting.

Right, I think we're out of questions. Oh, no.

There might be one more come through. Is the unexpected supply of mineral sands still coming out of Africa?

Do you see this being curbed by either price dynamics or regulation in those regions?

It'd be fair to say regulation, we haven't seen anything yet obvious. Over time, you would expect price to matter, but there is a bit of a time lag on the data.

Certainly, the most recent concentrate import statistics which I've seen, which are from November, still show significant volumes of concentrates flowing into China. Albeit that, if you think about the time lag here, those decisions may have been made before prices have further reduced.

Over time, I think one of the biggest things to consider with that flow of concentrate is the sheer volume of products that need to be moved, particularly ilmenite. When people are bringing in HMC, it typically contains more titanium minerals than zircon.

That market, that will be the market that constrains those imports rather than the zircon market.

Okay. Interesting.

Good. I think we're out of questions now.

Just to remind everyone, we are recording and we will be sending out links via our social media channels, etc. for the full video if you missed anything.

Bruce, just before we wrap up, any final thoughts at all?

No, just appreciate the opportunity to provide the update, and look forward to hopefully a better 2026.

Agreed. All right.

Bruce, thank you. Thank you, everyone, for attending.

Thank you.