Impala Platinum Holdings Limited

Good morning to everyone. Welcome here to all those present, the investment community, our own Implats people and for everyone who's dialed in as well, welcome.

Always an honor to represent a very talented Implats team. Extraordinary times that we are living in.

We had a presentation from one of the consulting firms the other day, and it was very clear that we are going through a shift in global order. It's a new era that is being introduced.

We're seeing changes in international relationships, institutions, NATO, trade paths are changing, supply chains are changing. The move from globalization to multipolarity is accelerating.

We just recently this weekend seen a new event unfold in the Middle East. And so all of this creates a number of consequences, one of which is uncertainty in future supply, particularly in natural resources and in our case, critical minerals and metals.

And critical can be defined in many ways. But one is, if it's used in critical industries like in Europe, the auto industry is a very important employer.

It affects politics. And so without our metals, there is a risk for the industry.

But then also our concentrated supply globally with 80% of the world's PGMs being produced from Southern Africa and the uniqueness of our metals, as has been said many times over the past. And so given these pressures and the uncertainty in supply chains, where will this metal come from in the past, there's a major topic of critical minerals and the hoarding of that, we've seen, as an example, the $12 billion evolve program announced by the U.S.

We certainly are having similar discussions with other jurisdictions or representatives of industry in other jurisdictions where similar concerns are being echoed where there's an engagement to determine the extent to which relationships can be formed to provide security for long-term supply. In addition to that, we've seen the flow out of the U.S.

dollar towards hard assets such as gold. We've seen record gold prices and other precious metals like platinum has now followed suit.

So that has in part been the driving force behind the extraordinary rise of the PGM dollar prices. On top of that, if you look at the market fundamentals, we do see continual downward revisions in the EV penetration rates.

We have witnessed in recent times a shift in priority in decarbonization in general, particularly in the U.S. But we have seen relaxation in terms of expectations of where the world wants to be in terms of, for instance, the percentage of fleet contribution of electric vehicles by certain dates 2030 and 2035.

And so that has resulted in an increase in demand for our metals. We have seen an increase in demand from Chinese jewelry and certain industrial customers as well.

On the other side, we do have certain supply risks being acknowledged by the market. We have not seen the historical levels of investment in future supply.

I had occasion to sit with the four CEOs -- the other four CEOs of PGMs. And even in February, we were unanimous that it's not the right time to consider large-scale greenfield capital projects at this stage.

And so if you look at the global order shift in world uncertainty combined with shifts in the fundamental markets that has given cause to the increase in -- sorry, on the wrong slide, metal prices. As a consequence of where -- of the nature of the major forces, it is our contention that the price support that we're currently seeing is not a short-term one.

This is not as a consequence of Donald Trump. It's the Trump effect.

It will outlast the current administration. It's not reliant on who wins the next election.

It's uncertainty -- once you've asked these questions, those questions remain relevant and you have to organize your country, your region very differently for a generation to follow. So it is our belief that this current upswing in prices will remain longer than has been the case in the past where we saw relatively short summers following very long winters.

And so if you look at our results, it's dominated by two major points. One, the production performance, both at mine operational level as well as in the processing division and what we sold, it's more or less in line broadly.

I mean, as I said in the video, if you look at all of those numbers, it's like 0% or plus 1% is around about there. So that's the one thing.

The business has been in good hands. We have navigated through this period in a very stable fashion.

The one red flag that we need to be cautious of is the increase in operating costs. Our unit cost increased by 11%.

There are reasons for that, that will be addressed by Meroonisha and our COO, but it is something that we have to be aware of. So I think cost management is something that we have to take into consideration and the operating cost specifically.

And then, of course, the other dominant factor has been this 40% increase in the rand basket price. And if you look through all of the financials, the entire industry is looking a lot more attractive than what it did in the previous period.

Given the fact that we are where we are in terms of metal prices and then increase in EBITDA and revenue and cash flow, it does provide us with a really important opportunity, and that is to change our strategic focus in the company. During the lean years, we are very defensive.

We focus on cost control, capital management. We even go as far as organizing or reorganizing labor and even do things like portfolio reviews to understand or to have a strategy if there is a further decline in prices.

So at the bottom, that talks about an inflection point. So if I look at where the company is positioned now, the focus is different.

We now have the opportunity to focus on how to strengthen the company. And our opportunities, there's like a funnel of a pipeline of opportunities, starting off at the most basic level, Patrick and his team with the support of Meroonisha and the rest of the executive have already implemented through Board support a number of early action programs to initiate life extension projects.

They've occurred at -- two Rivers, at Marula, at some of the shafts at Rustenburg. One of them has already been converted to a fully fledged capital application that was approved, and that's at 14 Shaft for roughly ZAR 1 billion.

And that will provide us with life extension project. I am very confident that some of these other early works programs that were initiated will result in approval of additional capital.

And based on Patrick's information, roughly, we will look at a 3-year extension to our current steady-state 3.5 million ounces per year production profile. Thereafter, we will require additional initiatives.

So that's the one part. The second part is that we do believe that there is room for optimizing of the industry through various actions.

One, there is the sharing of infrastructure. We are constrained at the moment with our processing capacity, and we have excess ounces.

But in future, I mean we do see a declining production profile. So that will open up some processing capacity to share in the industry.

And we do believe it's critically important for Southern Africa to protect local beneficiation of the metals. And so I think that the opportunity to do so will increase as we go forward.

Then there are the normal cross-boundary opportunities that always exist. And I can think about a few, but let me just raise one.

And I'm not -- please don't interpret this as me announcing any action. I'm just saying one of the areas that we have battled with in the industry is the Eastern Limb as an example.

So if you reimagine what the Eastern Limb could look like if it's operating as a greater unit, I think you can share concentrator capacity with mining capacity, but it will provide you with better muscle to create a more attractive area to get skill better -- a better range of skills in the area and to do better at your socioeconomic contribution to increase the license to operate. So I think there is an opportunity.

If I look at Zim, there are a number of emergent producers, GDI, Karo's and so on. So I think that there is an opportunity not only for Implats, but for the industry to reimagine how it operates and to optimize to increase further efficiencies as an industry.

And I do think Implats is very well positioned. I mean, we are represented in all the major producing -- PGM producing areas other than Russia.

So I mean, we are in South Africa, Western Limb, Northern Limb, Eastern Limb, as well as in the Great Dyke as well as North America. So I do think that we're very well positioned.

We do have a good track record in constructive partnerships, toll arrangements, joint ventures. We have been operating in Africa where we focus on long-term strategic relationships.

So that's something that we think is quite valuable in considering future options. And then I mean, we can ask more questions about it, but then there would be the questions about greenfields, the Waterberg and the big other thing.

As I said earlier, we remain cautious about introducing major new ounces to the market at this point. So we do not expect to make any announcements about that soon.

On that note, I would like to hand over to our esteemed COO, Mr. Patrick Morutlwa.

Thank you, Nico. Yes.

Good morning, everyone. It's really a privilege for me to present our group results.

And I'll start with safety, health and environment, which underpins everything we do in our group. So for the past 18 months, we have been implementing our 8-point safety plan.

And I'm glad to say it is starting to deliver a step change in safety that we've actually envisaged. And this is seen in some of the milestones we've achieved for the period.

Our mining and processing division for the first time for the period actually went fatal-free. Similarly, so Rustenburg, one of our biggest operations achieved 5 million without the free shift in the period.

And also, if you look at our key risks: fall of ground, winches and machinery, we saw a 12% reduction in injuries, which is all symbolizing and strengthening of career controls in those areas. So while we are building on this momentum, we are equally humbled and also grounded because of the two losses of life we incurred, one in the period and one post the period.

So we are reflecting, we are learning, and we will be taking these lessons to make sure that we implement no repeat solutions. So we don't repeat this type of incidents.

On the environmental side, our ESG programs continue to receive global recognition. As you've seen in the video, for the fifth year running, we have been included in S&P's Sustainability Yearbook.

And during all the same period, you have seen that we have not recorded any Level 3 to Level 5 environmental incident. So we operate sustainably because this is the way we express our values of care, respect and deliver.

And lastly, on the health side, also our health programs continue to deliver positive results. Our HIV and TB prevalence are well below the national averages.

So the next thing for us for health really is to focus on mental health and psychological health of our employees because healthy employees are engaged, they are safe, but they are also productive. Then moving over to production.

We have actually delivered a steady and consistent production, which was really buoyed by second quarter, which was much stronger than the first half. So what you also see that this has happened despite three of our operations having some serious strategic shift.

At Marula, we focus on development. At Canada, we continue with the high-grade strategy as previously communicated.

And lastly, Rustenburg 3 of our shafts are nearing end of the economic life. So we had to deal with labor movement in those shafts.

So going forward, in terms of processing, we also have seen strong performance. And this is also on the back of the work we have done.

We have upgraded our BMR at Springs, and we have also done some design and maintenance work in Rustenburg furnaces. So you will see that for our BMR, we have actually a record milling and also for this period, Rustenburg smelter performed very well above budget.

And as a result, we were able to release 20,000 ounces of excess inventory. Usually, our release is gravitated towards H2.

But because of this good work, we are able to release 20,000 ounces. Our furnace 4 have gone down for maintenance way ahead of schedule.

We should be able to restart now in April. And as a result, very confident to release 100,000 of excess inventory as promised at the start of the year.

As Nico spoke about the cost, we were about 5.5% above the mine inflation. This was a decision to strategically invest in our infrastructure, particularly some conveyor belt in Zimplats and also improving our maintenance fleet across the group.

This will set us well for the future to make sure that we can maintain the current production, but we also deliver into the future expectations. So as I stand here, I can safely say we will meet our guidance on production, on cost and capital for the year.

Thank you very much, and I'll hand over to Meroonisha.

Thank you, Patrick. And I'm checking the time still good morning, everyone.

So clearly, the steady operational performance that you've seen enabled us to fully benefit from the 40% improvement in pricing. Let me just get there.

Okay. So you'll see EBITDA up at ZAR 18.1 billion, headline earnings, ZAR 9.3 billion.

But I think what is noteworthy is that we did not have any unusual non-recurring items in our earnings for the period. As Patrick and Nico spoke about, given the improved pricing and profitability, we were allowed to reinvest in the business.

So you'll see some of that in our unit costs, where we took the opportunity with the improved cash flow to spend more on infrastructure and maintenance. And of course, some of that contributed to the 11% increase that you've seen.

If you -- and that is particularly at two of our biggest operations, our Rustenburg operations and Zimplats. If you look at free cash flow for the period, we generated significant -- there was a significant improvement from ZAR 600 million in the previous year, up to ZAR 7 billion.

And this was driven largely by the improved profitability, but some of this was offset by the buildup in working capital. I think what's important to note is that at the end of the period, there was an additional tax payment that was due of ZAR 1.4 billion, and we made this payment in January, and it basically was a top-up to our provisional tax.

If you recall, there was quite a steep increase in prices in the month of December. And clearly, we worked our forecast that were done in November that didn't fully take into consideration the rapid improvement in pricing.

If you look at the balance sheet, we used the opportunity of the improved free cash flow to repay some debt. So we repaid about ZAR 800 million worth of debt, mostly at Zimplats, and our gross debt declined from ZAR 1.8 billion down to ZAR 1 billion.

Another very important thing we did in the period was our group revolving credit facility was almost -- I think it would have expired now in February. So we took the opportunity to refinance it in quarter 2.

And basically, we upsized it from the -- just under ZAR 8 billion to ZAR 14 billion, and we managed to do this on very competitive terms. The new revolving credit facility is valid for -- well, extends for 3 years, and we've got two -- the reason that I mentioned the RCF is we've made some changes to our disclosure on net cash.

So in line with the new RCF, we amended the disclosure and definition of net cash to align to the RCF. What this meant is that, we now exclude the deferred revenue from the gold stream from the net cash balance, but also we are not now including the cash held at Zimplats in local currency in our cash balance.

And that really is because of the fact that, that currency is not -- you cannot use it outside of Zimbabwe. So on this basis, our net cash got adjusted -- our net cash increased from ZAR 8.1 billion to ZAR 12.1 billion.

And with the undrawn revolving credit facility of ZAR 14 billion, we closed the year with headroom of just -- liquidity headroom of just under ZAR 29 billion. I think before I go on to the next slide, I just want to point out a few things.

If I look forward, I think the company is really well poised to take advantage of the favorable metal price environment. And there's a few factors that I would like to highlight.

Firstly, you've seen sustained operational delivery, and I have no doubt that the team will continue to deliver into H2. We have got a track record of good cost discipline, and it is something that will receive focus.

But that -- but I think our teams will deliver on keeping the cost tight. Our capital intensity has normalized, but we've got the ability and the capacity to further strengthen the business and invest in progressing our life of mine projects.

And I think the other point, which is very important, is that we have expanded processing capacity and the excess inventory. And I don't think we must underestimate the flexibility this gives us to manage any operational challenges that we might have along the way, and it does support free cash flow generation.

If I can then move on to capital allocation. So after repaying about ZAR 800 million worth of debt and making provision for the ZAR 1.4 billion tax payment, the Board declared a dividend of ZAR 4.10 per share or ZAR 3.7 billion.

This represents a free cash -- sorry, a payout ratio of 60%, about 60% of adjusted free cash flow, which is double our minimum policy. And if you take into consideration the tax payment that was due, it's about 80% of the available free cash flow.

As a result of, obviously, prior capital allocation decisions as well as completing a number of our strategic projects, there was limited capital that was allocated to growth and investment. I think what the capital allocation should demonstrate is that overall, we have maintained our disciplined and consistent approach to capital allocation, and we have prioritized returns to shareholders.

Lastly, as Patrick has alluded to, we will obviously end with the market guidance. We're very pleased that we keep our guidance intact.

And I believe given where the business is, we are well on track to deliver within this guidance. So with that, I'd like to hand over to Johan.

All right. Thanks to the team.

Happy to take some questions as normal. I think let's start in the room.

There will be some roving mics. We will pass that along.

Just for the benefit of people that might not see on the screen or the camera, just start just to raise your name, just so that everybody knows who's asking the question. We've got a couple of hands up here.

Chris, let's start there with you.

It's Chris Nicholson from RMB Morgan Stanley. A couple of questions, if I may.

So you've provided a fairly optimistic outlook on the pricing environment. Maybe a bit of a surprise that you didn't accelerate, maybe some of the capital projects to the same extent.

So here you're doing some early work. Could you maybe give us further details specifically on Marula?

Is this akin to what was previously known as Phase 2? And what type of mine life extension you're looking to get there?

Similarly at Impala Rustenburg, 14 Shaft and some of the other extensions, how long are you looking to extend mine life by there? And then kind of linked to that, should we expect ZAR 9 billion of CapEx going forward?

Is that a good level into these prices? And then just second question, again, optimistic price outlook.

I think some might be slightly disappointed with the dividend. You've seen another 2 months of very strong prices since year-end.

Just thought process as to why you need to hold too much cash on balance sheet again.

Okay. I think, Pat, if you don't mind.

The first question is about the life mine extension projects, the specifics and that's what they are going to cost and the expected life extension.

Yes. Let me start first with Rustenberg.

As Nico said, we have already approved 14 Shaft extension. It is taking the existing decline into the 18 shaft area.

It will give us 4 additional years, which will maintain the current production for another 4 years. It is about ZAR 877 million.

The early capital was approved the last quarter, so work is continuing there. Then again, there, we have Rustenberg 20 shaft, where we're now taking 20 shaft into the Styldrift ground.

So that work, we're still validating the feasibility study. It should be coming to the board somewhere in August.

So I cannot share the numbers now, but it will also extend life approximately 5 to 6 years there. Then the last one is BRPM North shaft, is just taking the existing decline further.

So that one, it will give us a much more long life, anything between 10 and 15 years. And again, there early capital approved, so we're executing the final capital numbers not yet finalized.

Then moving over to Marula. Marula Phase 2 was closed given that at the time we executing that project, the price did climate.

So as part of cost preservation, we did stop that. But now with the new prices, we have restarted the work, approved ZAR 40 million of early capital.

So it's not going to be the same as Phase 2. So we're actually doing small chunks.

So this project is now divided in four phases. Phase 1 is taking the 11 shaft 2 level down, and there will be a big chunk of capital to secure infrastructure then further chunks of capital to take both Driekop and Clapham down.

So we have designed in such a way that we've got proper off ramps through the price plan, we should be able to stop. So the first phase, I spoke about should give us additional 5 to 6 years on top of the existing 6-year life left at Marula.

So that's more or less high level on this project that we have undertaken.

And Patrick, the ZAR 9 billion capital, is that a fair expectation or...

All right. Thank you for that.

So you remember, we gave you between ZAR 8 billion and ZAR 9 billion. With this bolt-on project, you can add a maximum ZAR 2 billion.

So I think it makes ZAR 10.5 billion, because we will start very slow and just ramp up a bit. But I don't see it going beyond ZAR 11 billion, really.

Chris, I want to -- sorry, I just want to add -- actually, maybe repeat Patrick's words, but in a different form because you asked is it Phase 2? And he said, no.

I think it is. But the application of how we get there is different.

In fact, the first time we did, we had a ZAR 5.5 billion single project and we had agreed off-ramp points whereas this time, we are saying there's no single ZAR 5.5 billion project. There are going to be a sequence of smaller projects.

And so we will have like a consolidated assessment for the entire thing, which will be based on the valuation, but the implementation will have to meet certain performance hurdles as we go along for the next phase to be implemented. So essentially, it's Phase 2 wrapping different color.

And if I may just add one thing. Nico earlier said that with this project, they will push the 3.5 million ounces back out another 3 years.

In addition to that, the old profile within 10 years' time, if we did nothing, we're going to lose 50% of our production. Now this project have also helped to slow down the decline.

So within the same 10 years, if we do all this project, we will only be dropping by 15%. So they do actually extend life and the angle of decline.

And sorry, I'm again butting in. But I think Tim will kill us if we don't talk about Canada because I really think that there's an opportunity there.

I mean, we have already extended the life to April '27. But the technical team at Impala Canada is working on a novel technology for us in the group, which is called dry tailings, which makes use of the filtered tailing plant, which enables you to essentially to dry out the tailings and place that on existing tailings dams as opposed to creating a new greenfield tailing dam, which requires new licensing and permits and so forth.

I mean the capital expenditure is quite intense, but that will provide Canada with not an incremental 1 year time life, but that will enable us to take a longer position subject to the palladium price remaining at above $1,600 or something like that. And then we haven't quite spoken about Mimosa.

I mean, there's a few things to resolve in Zim specifically, but there is still the opportunity to consider some form of North Hill extension to life at Mimosa, which currently we're not speaking to because it's not currently in the works. It's being evaluated and we've got a partner that we need to consult them on that and so forth.

Sorry, the question on the cash. So I think there were two parts to it.

So the one was around why the ZAR 10 billion and the other one was about the cash that we've made since year-end. So let me address the second part of it first.

I mean our policy, and we've consistently applied it is when we look at the dividend, it's on the cash that was made in the 6-month period. So you can -- if you look at the trajectory of the price, you'll see December, we had the rapid increase and then January, February, we've enjoyed these very, very high prices.

Also, you've got to take into consideration we have contracts that -- a lot of contractual sales, and we've obviously got the lag in the contractual sales. So that increase in December only really will flow through mostly in the second half of the year.

So to the extent that, that flows through in the second half, that will be part of the free cash flow for the second half and it becomes available for distribution per our capital allocation framework in the next 6 months. And maybe just to add to that point is that if you just look forward at our capital allocation, there's a little bit of work to be done on the balance sheet, not a lot of debt.

So even if we want to do it, it's not going to take a lot of capital. There's -- Patrick and Nico have talked about our life of mine extensions, but there's no greenfield projects that we're looking at.

So there should be a fair -- all of that profitability should be available for distribution in the at the year-end. The second question was really around the ZAR 10 billion and why the ZAR 10 billion.

So I mean, it's like running your bank account. Nobody wants to run on an overdraft.

So here, what we do is we look at -- so what is the liquidity that we need for the group. And remember, we've got entities in different jurisdictions at different currencies.

And so the view that we have is that all of our operations should be able to pay -- settle its working capital and be able to operate for 1 month without resorting to borrowing of money. And so, that's how we get to the ZAR 10 billion.

And you can imagine that there's timing differences between sales, et cetera. And with IRS, there are big payments that need to be made.

So we need to be able to hold enough money in the required currencies in the required jurisdictions to be able to manage all of the timing. So that really is how we -- there's no other signs to how we get to the ZAR 10 billion.

Gerhard Engelbrecht, Absa. Chris has asked the questions.

So I'm not going to flog that horse any longer. Can you maybe give us an idea of any near future furnace maintenance projects, shutdowns that you have on the cards?

Adele is here, if she wants to speak to that.

That's a good idea. Where's Adele?

If she's at the back, you can perhaps just pass her the mic.

Adele, come stand quickly here in front of me.

Good afternoon. Thank you for that question.

Yes, we have furnace maintenance, furnace scheduling going on as per our normal maintenance philosophies and structures. And obviously, to make sure that our infrastructure is sustainable going forward.

As Patrick already mentioned, we have #4 furnace that is currently in rebuild that we hope to get power on that furnace very soon. Also on schedule as what was planned.

We also will be having at our Zimplats operation in the coming year, not in the next 6 months, in our new year, we will be doing our end walls also as per our internal maintenance strategic plan. And then going forward, as everyone should be knowing by, should know by now, we are planning the rebuild of our future furnace.

And we will commence with our rebuild, our new design in Rustenburg come July 2027. And that will be on the furnace #5.

Hopefully, that is answering the questions. Thank you.

Adele, just to put a final point on it. It's fair to say that we're back to normal furnace maintenance.

The interventions are all behind us now.

Sorry, Johan, if I can just add, as I do, just one more point to that. Historically, if we went into furnace rebuilds, we would have accumulated additional stock.

So, the historical work that has been done on expanding the smelter capacity as well as the 10% expansion of our base metal refinery results in current capacity that prevents the buildup of stock. That's why, I mean, we've only released 20,000 ounces of the committed, I think it was.

110,000 ounces.

Yes. 110,000 ounces.

110,000 ounces is what we committed to the market. I see that's changed to 100,000 ounces only.

I think we are on track, notwithstanding the maintenance on the smelter to release 110,000 ounces for the year. I think that is quite newsworthy.

And also, I mean, as Adele, you didn't mention on the -- sorry, I'm expanding. But in base metal refinery, we have achieved record milling rates again, which prevents us from having to build up stock in front of the BMR.

So the investments that we've made over the past three or four years has really paid off. Sorry, Johan.

No, all good. One more question, Arnold.

After Arnold, I will given opportunity on Chorus Call. So if you're on Chorus Call, you can queue yourselves along, and then we'll move to Chorus Call after Arnold's question.

It's Arnold Van Graan from Nedbank. Just want to go back to your capital projects which you're doing in phases.

Look, I welcome that because the last thing we want is everyone jumping in and just bringing on excess capacity. But my question is, how efficient is it doing these projects piecemeal as opposed to the big projects?

And what I'm thinking about is further down the line where you then ultimately will have to in any way do the whole thing. My concern is that interim, it creates inefficiencies in the system.

And we're already looking at your cost number. You alluded to that it's -- it's under pressure.

So, yes, how do you manage that? What is different?

Why did you previously want to do all of it in one go, and now you're doing it in phases other than the balance sheet impact?

So firstly, you can also contribute. So, you are 100% correct.

I mean, I was just saying if you have got a 5-year mining contract, you can do that once, if you do it, break it up into different parts, you've got slightly establishment costs and all of that. I mean, I think that there are ways to mitigate that to ensure that the different phases are dovetailed.

But there are performance conditions to the continuation. And that's where -- I mean, we need to see an improved Marula.

I mean, Marula even at current prices, if I look at the cash contribution of Marula, it is -- if I have to be honest, it's below expectation. And so we want to incentivize ourselves and the operation and the project by making sure that the financial valuation on which these things are premised is, in fact, met.

And so I am 100% convinced with all of the additional face length that is being created and the improvements in the infrastructure, we are going to get to a stronger position of confidence with Marula. But at the moment, we think in spite of the potential cost inefficiencies, it is better for us to have a cautious approach to investing large sums of capital in the projects that really requires some improved operating performance and project execution performance.

Yes. I think the only thing I can add, Nico, is that, I mean, as you said, that we do the evaluation of this project, the whole project.

But then we divide into critical milestone to open all reserves, but also that milestone #1 should be able to pay for milestone #2. But also, again, like I said earlier, these are off ramps.

So should the price plummet, you have not committed cash and have a lot of unfinished bits and pieces, because that's exactly what caught us the last time. So we want to make sure that when the price plummets, we've actually delivered phase then that can take the mine further.

So it's literally just make sure that we don't commit cash all over and when the price plan is, we have got a lot of unfinished bits and pieces.

As high as you can.

Yes. And one small last consideration, Marula has the option if we can navigate through farm boundaries of extending laterally.

So we have just not been successful in achieving those agreements to the extent that we can. That will be a far more efficient capital investment per ounce generated, so we are hoping that between now and final execution at some point that we have an opportunity to settle on some of that potential and that will then typically replace some of the deepening as an interim and shift Phase 2 later components further down the path.

Okay. I'm going to queue to Chorus Call.

I can see there's one question on Chorus Call. So I'm going to hand over to the coordinator.

Good afternoon, and thank you for the opportunity to ask questions. You've spoken about life of mine extension, and I'm referring to Impala Rustenburg.

But I also just want to get a bit of a confirmation as to how we should think about life of mine for some of the shafts that have a shorter life, and that's Shaft #1, Shaft #6, and E/F. I think the last time I asked this question, you said 1.5 years, but prices have increased.

You probably are able to keep these shafts going for a bit longer. So, if you can give us a little bit of guidance around that, that would be helpful.

My second question is very much on costs. We've seen you spend close to ZAR 1 billion on technology around winders.

Are there other areas that you're looking to do something similar in order to improve your asset reliability? And what does it actually -- what are the implications for cost beyond FY '26?

Then I also have a question for Nico, and this is regarding Zimplats. And if Alex is there, he can also answer.

I just wanna your experience of operating in Zimbabwe during your tenure. From headline news, it would what I'm seeing is the risk is not necessarily declining there.

And the latest news was the ban on unprocessed raw material does not seem to affect you guys, but somehow it looks like the risk continues to actually escalate. And then there's also the financial issues.

So, if you can just comment in terms of how you are experiencing Zimplats at this point in time, how we should think about it going forward? So those are my three questions.

Thank you, Nkateko. Moses, can we pass a microphone to you specifically on 1 E&F, #6 Shaft, and your view of prices now?

Can we just get a microphone to Moses, please?

Thank you very much, Nkateko. This time I've got your surname correctly.

Regarding 1 Shaft, when we remember in this current business plan, we've got one year for 1 Shaft, we've got one year for 6 Shaft, we've got two years for E&F. We are currently evaluating that.

As it stands, it appear that 1 Shaft will have additional year, and then 6 Shaft will remain on one year, and E&F will also remain on 2 years. There's not much of a change with the current blocks or reserves that we've got.

It looks like 6 Shaft will be out, E&F maybe 2 years, and 1 Shaft, 2 years. That's for the shorter life shafts.

Perhaps Johan, I can also just jump on the capital that we are spending on our infrastructure. Nico spoke about spending a little bit more capital on the infrastructure.

Yes, it's correct. When we look at the longer shafts or the growth shafts, we are looking at spending, I mean, upgrading all those winders to make sure that in the long term, they do sustain us even if the prices goes down.

So there's about a capital of just over ZAR 800 million, that we want to spend it on our winder infrastructure. We see that as an opportunity, especially during this price commodity that we find ourselves at.

Thanks.

Let's just talk about Zim and the perceived risk with the jurisdiction. In my opening, I did talk about our presence in Africa in difficult jurisdictions.

We believe that long-term partnerships are absolutely critical. And that has proven very successful for Implats throughout its 25-year presence in Zim right now.

Funny enough, we've actually had worse times. I can remember there were times, Johan, prior to any of us joining, I mean, we had to pay employees in not in money, in groceries and so forth.

And so, difficulty in Zimbabwe is not new to us. And what I will say is that we've got an extremely cooperative relationship between Implats, Zimplats, as well as government and the communities.

I mean, just as an example, now for the second time that I'm aware of, during the difficult times, employees agreed to a salary reduction to accommodate the fall in price. That, I mean, that's the kind of relationship that we have.

So having said that, the big issue at Zim is the uncertainty of policy and the shifts that happen from time to time, and that scares foreign direct investors quite a lot. So, if it's difficult, that's one thing.

If you're never certain what the rules are gonna be in the next year, that is a different kettle of fish. And I do find that at the moment, for us, there is elevated risk.

And so we have -- we are navigating through a process with the government to address that because our perception of risk has materially shifted upwards over the last year or 2 years. And in part, it's the change in policies, but it's also got to do with the retention of local currency that is owed to Zimplats in exchange for the foreign currency retention in terms of the foreign -- the policy of Zim.

And so, in fact, Leanne and I just had this morning an extensive meeting with Alex. We are scheduled to meet with SA government as well as with the Zim government.

I have to believe that a successful outcome will be achieved. It has always been achieved in the past.

And I'm very confident that we will get to a similar position right now. So our posture will not necessarily change with immediate effect.

I don't see further questions on the Chorus Call, so I'm gonna go to the webcast. I'm also conscious of time.

I'll try and group the ones that can be grouped all together. There's a question here from Adrian.

I think we've dealt with the two first parts of his question. The second one hasn't come up, which is, can you give us some color on some of your customer order trends in the auto space and some of the other minor metals?

So, I guess with all the volatility in prices, how does your customers engage and buy your metals? Sifiso, you're probably best positioned to talk to that.

Any news hot off the press from our customer base?

Thank you. Thank you, and good afternoon, everyone.

From our customer side, we've seen increased requirements in terms of all the metals. The higher list rates are actually making our customers require metal earlier than they would normally do.

So, we've seen this during our H1 FY 2026, and the trend is still continuing.

And sorry, Kirt, I'm not sure if you would like. Sifiso spoke to you about the existing customers.

But the conversations that you have been engaged in during Indaba and recently, and perhaps how the focus of potential consumers of the metal, I spoke earlier about some of the relationship requirements or expectations or hopes.

Yes. I think what we are seeing more broadly than I think the normal customer ongoing relationships is an increased focus from the OEMs and the end users to secure supply as well as price certainty for the future.

So it's very much the story that was playing out in the BEV space a few years ago, where there is a requirement to create longer term relationships than just the normal short-term fixed price contracts and potentially for the OEMs to move upstream and create these longer term partnerships with the actual suppliers and the miners of the metal on more attractive pricing. But largely to secure supply, particularly linked into this ongoing issue, as Nico mentioned, of a more multipolarized world and creating security for each of the regions in which these OEMs are operating in.

Thanks, Kirt. Interestingly enough, there's two people asking exactly the same question.

Rene Hochreiter, and David Fraser, specifically to Nico, and now that you're reimagining what an Eastern Limb could look like, any thoughts on the Waterberg project and, you know, whether it's a different way of imagining it fitting into the world, specifically given its palladium dominance?

No.

All right. We've dealt with that one.

Yes. So I mean, the Waterberg project is in the Northern Limb.

We are acutely aware that it has got a strong palladium bias, and that's probably the metal that we have got the least confidence in long term. I mean -- well, our palladium and rhodium.

I mean, I do believe that there will be a place for the Waterberg project. We do not see that as imminent right now.

Perfect. And then I can probably conclude there and to all of the questions, and to the extent that we don't get to them, we will make sure we come back.

I think there's two or three that again specifically asks about the dividend and given the metal prices, the good operating performance, was there any consideration of higher payouts or other ways of returning value to shareholders? That question is repeated by a couple of people online.

So maybe, we have answered it, I think, but maybe in conclusion.

Just -- so, I think -- I mean, clearly if you look, if you look forward, are we gonna generate substantial cash? And I have spoken about allocations to balance sheet and growth, and investment are not gonna be significant.

So with that, there are gonna be increasing returns to shareholders. At the time when we look at the returns, we do have options.

The one is to do what we've done in the past, which is to provide a sort of a special dividend by increasing the payout ratio. But there is also the option to look at a combination of these special dividends and potentially share buybacks.

I mean, we haven't undertaken one in the past, but I think at any point when we look at these surplus funds to return back to shareholders, we will have to look at what the most effective way to return value to shareholders at that point in time.

So with those great prospects, probably a good time to end. We're really, really looking forward to spending some time with you on the road.

For the people in the room, please join us afterwards. There is some snacks available.

The whole management team is here, so a good opportunity to ask those other questions that perhaps we didn't get to. And then for people on the webcast and Chorus Call, thank you for joining us.

We should see most of you on the road over the next week or 2 weeks. And to the extent that you have any questions, please reach out to the team and we'll endeavor to answer it as quickly as possible.

Thank you very much.