Hello, and welcome to Antofagasta's 2025 Half Year Results Call. We will start today's session with a short introduction from Antofagasta to be followed by a question and answer session. [Operator Instructions] I'll now hand you over to Rosario Orchard, Director of Antofagasta's London office to introduce today's speakers.

Good morning, good afternoon, everybody. Welcome to our half year call for 2025. I'm here today with our Chief Executive, Ivan Arriagada; our CFO, Mauricio Ortiz; and our Vice President of Sustainability, Alejandra Vial. In terms of process today, Ivan will start with a short introduction, and then we'll move straight into Q&A. And we'll aim to wrap up within 45 minutes. Ivan, over to you.

Thank you, Rosario, and hello to everyone. It's great to be hosting this call, and thank you for your time. We have today released our set of half one financial results. We have a strong set of financial results. Our revenues are up 29%. EBITDA is up 60%, and our cash flow is also shown a significant increase. And this has been achieved on the back of higher copper production when we compare it with last year and also an important increase in gold and moly production. EBITDA margin was 58.8%, which is a 25% increase on the prior year. So by all measures, I would say that our financial performance in the first half was strong. In parallel to that, we continue to make good progress on our projects. we are executing two important projects, as you know, the expansion at Centinela, which involves the construction of a new concentrator plant and also the expansion of the water system at Pelambres and replacing some infrastructure like the concentrate pipeline. I'm pleased to share with you that we've made good progress during the first half. Our projects are tracking according to program. And therefore, by the end and when this is completed, when we expect they will, we should be able to achieve an increase in production, which is in the order of 30%. So good progress in our projects. And then finally, as an introduction, I would say that we have declared a dividend, which is in line with our policy. Our policy, which we have consistently applied is that we have a dividend of 35% of net earnings at the interim or half year. And in line with that, we've declared a dividend of $0.166 per share. So overall, I think a solid performance for the first half. So with those brief words, I would then like to essentially initiate the Q&A. And so I will pass that on to Rosario.

Ladies and gentlemen, we will now begin our Q&A session. [Operator Instructions] Our first question comes from Ephrem Ravi with Citigroup.

Congratulations first on a good set of results. Two very quick questions from me. Firstly, clearly, the CapEx in the first half is significantly below the 50% mark for the $3.9 billion CapEx guidance for the year, there is Encuentro deposit that -- where the construction will start. But other than that, can you give a bridge as to what are the incremental items that will kind of require $2.3 billion of CapEx for the second half. I guess Encuentro is probably about $200 million that still gives us significant delta versus the first half CapEx number? And secondly, in terms of Cuprochlor , clearly Zaldívar mine life extension permits is good news. When is the earliest you would be deploying that at Zaldívar, which I guess is the first place where you would be trying that out?

I would say on capital spend, yes, we did report $1.6 billion of capital spend for the first half and we've kept our guidance of $3.9 billion for the full year. And I think the factors that explain that one is that by plan, the second half was more weighted with respect to the annual capital spend. So we do expect, according to our programs and how the work is performed that more work is done in the second half compared to the first one. And I would say that's largely across the main projects. Then in the second half, as you pointed out, we have some new projects which have not recorded spend in the first half, and that's namely the Encuentro pit so that the Encuentro pit project was sanctioned in June. Therefore, we expect that spend to start to ramp up and none of that was present in the first half. So those are, I would say, the key elements that explain why we expect the second half to be more loaded on spend. Now I would want to emphasize that the good news is that we have both projects at Centinela and Pelambres on track. I mean they are progressing well. We've had a lot of very impressive progress, I would say, at Centinela and at Pelambres, some of which you will be able to see for those who come at the site visit in November. So our projects are doing well and the fact that we have more phased spend in half two is, as I say, associated to the planned spend, which was loaded to the second half and also new projects like the Encuentro. So those are the reasons. There's nothing different to that Ephrem, on that front. Now with respect to Cuprochlor, you know that this is a technology that we've been working for a long time, and we are expecting now to complete the construction of what we call is an industrial scale heap at Zaldívar, we will be completing that in the course of next year. And as we do that and test that case, we expect to deploy this technology in Zaldívar, but not, I would say, before 2028. So there's still some time to go. But obviously, this is an important step. All the tests that we have conducted so far indicate that this is a highly reliable technology for the purposes of recovering copper from a primary ore of the chalcopyrite type. So we're very excited about what we're constructing and how this is moving.

Our next question comes from Ioannis Masvoulas at Morgan Stanley.

Just two questions from my side. First of all, on the production outlook for the balance of this year and also potentially if you can talk about next year as well. Your guidance has remained unchanged for 2025. And yet you indicated some additional maintenance at Los Pelambres that will have some production impact. As we think about the H1 to H2 bridge, is the volume uplift that is embedded into your guidance fully driven by Los Pelambres? Or are any of the other operations deliver better volumes in the second half? And maybe on this topic, if you can comment around the -- how do you see the grade profile at Los Pelambres into next year as well? Because I think in the past, you were talking about potentially north of 0.6% grade next year. Do you think that's still sort of the base case? And then second question on Zaldívar. We're talking about the mine life extension, which looks quite interesting. But at the same time, water solution, you have 2 or 3 different options here. And it is the most -- this is the highest cost asset you have in your business today, do you think fully owned water solution that's going to be fairly capital intensive it's still one of the preferred solutions? Or would you seek alternative options that will be more capital light? And I'll leave it here on my side.

Yes. Thank you, Ioannis, for the question. I mean in terms of production, again, we -- there is -- if you look back, there's been a pattern of higher production in the second half, especially in quarter 4, and that's associated generally to more maintenance work being done in the first half, especially in quarter 1. So that remains the case. We have reiterated our guidance, and therefore, we expect that annual mill production will be within the range that we have provided. Now with respect to next year, we will provide guidance as we usually do in quarter 3. But as we've mentioned in the past, we do expect that there's a great trend in Pelambres, which we will start to see next year towards grades, which are more consistent with sort of historical averages and therefore, that will come into play next year. And therefore, we expect some grade increase there. But we will provide full guidance in quarter 3. I think in terms of the mix between the different operations for half 2, we obviously expect that our two main operations will see some increase Pelambres and Centinela that makes part of the guidance for the full year we have provided. Now on Zaldívar, I think that moving on to that question, I think we're very pleased with the fact that the permit obviously was renewed and there was no discontinuity in the operation. And we have a mine permit, which takes us to now 2051. But we need to provide for a water solution beyond 2028 when the current new permit expires. and we are looking at a couple of options. One is to undertake a project ourselves, as you mentioned, we have an alternative, which would be lighter on the capital side because it would be relied on essentially water being provided by a third party at a point in which we have to then pick up and transfer to Zaldívar. We like lighter asset solutions, and therefore, certainly, that's something that we're looking at with a lot of interest, but we need to finish the review that we're doing with respect to the specific risks that, that alternative involves but it's looking good. And to the extent that we have an option, which is lighter on capital, it will rank ahead. But we are reviewing those studies and completing those the review of those alternatives. I think the good news is that we have a long-term solution and therefore, we have the ability to continue to operate Zaldívar and monetize over 1 billion tonnes of resources that Zaldívar has. So I think the extension of the permit, the continuity of the operation and the fact that we can look now until 2051 is very good news.

Our next question comes from Matt Greene at Goldman Sachs.

Yes, probably just a follow-on from Zaldívar. When can we expect a final investment decision on Cuprochlor-T? Obviously, you mentioned the industrial scale next year. But perhaps if you just kind of think about over the next -- over the medium term, what are the sort of the critical parts around that? And to Ioannis' question, I guess, does the decision around water solution come before a decision around Cuprochlor-T. That's my first question. I'll follow up with the next.

Yes. Look, I think the -- we are planning to complete this industrial scale heap next year. We will therefore, integrate these into the full feasibility studies that we have to complete. As I mentioned before, we don't expect a decision before 2028 as we sort of progress our feasibility and review studies. But they're all looking positive and this is a technology that, in our view, now we've reached a level in which it's been now fully tested. We are looking at the specifics of the ore type at the Zaldívar, which is important for how we operate it in the long term. Now with that, having said that, the sequence likely involves that we will make a decision on water before we make a decision on the Cuprochlor-T. But I think what is important is the current mine life of Zaldívar takes us well beyond, I would say, 2035. And then on the back of that, on top of that, we've got the primary ore body. And so we will be quite advanced when we make the assessment on which water solution we make with respect to these studies. So likely to come before, but we will be quite advanced and as I say, we think this is quite a reliable solution. The tests that we're performing have more to do with the specifics of the configuration for the type of ore that's mined at Zaldívar than with the proof of the technology.

That's helpful. And if I could just follow up. You mentioned on the previous question that you're open to more CapEx-light solutions in relationship in relation to that water. And I presume on the go-forward lower risk path way is scaling up for CuproChlor. And I guess Antofagasta in the past has -- you've been vocal about being open to collaborations that present physical, I guess, operating synergies around mine planning and I'm asking this, I guess, through the lens of Zaldívar and Escondida, there's Mantoverde large oxide resource that is essentially an extension of Zaldívar. And obviously, Escondida Norte which could do with a pushback into your land package there and give Escondida some high-grade sulfide. So is there not a partnership to be had here between Escondida and Zaldívar just around all movements and potentially from your standpoint, a lower risk pathway to scaling up Cuprochlor if you have access to more oxide material?

Yes. Look, I think certainly, Zaldívar is adjacent to Escondida and very adjacent in the sense almost share the same footprint. And we have a partnership in the sense that we have internship agreements to be able to jointly mine certain common areas. So that coordination at the mine planning and execution level does take place, and it's been ongoing. And obviously, we will always be looking and continue to look out opportunities to enhance that. When you have a common role as we do have, there are synergies and potential benefits of having a more coordinated mining activity as you've mentioned. And to the extent that there are opportunities to expand those and amplify those will always be available and looking for them. So we will continue to pursue those. We have today, as I say, agreements in place that allow us to, in a coordinated way, mine the areas that are of common interest. So we will continue to work in this line.

[Operator Instructions] Our next question comes from Amos Fletcher at Barclays.

I had a couple of questions. First one was to ask about working capital in the second half, what your expectations are there? And then second question, just on CapEx. I was wondering if you could give us a sense of the sensitivity of your CapEx budget to movements in FX, please?

Yes. Look, I think with respect to both of these, I'm going to ask Mauricio to address them. So working capital and CapEx sensitivity. Mauricio, you want to take that, please?

Well, thank you. Well, regarding working capital in the first half, we have a negative movement, mainly driven by the increase on receivables. As you may realize, we have higher sales in all our products. So that was translated in higher receivables. And that explains the bulk of the working capital movement, along with slightly higher copper price and of course, higher gold price. Going into the second half, what we may expect is that some of that impact will be removed in the second half as our shipment will normalize, but of course, as the price is moving to the positive area, we may have -- we may see an increase in payables along in the second half as well. And in CapEx sensitivity, I don't know if you can give me some -- a bit more details on what you are asking specifically to just don't repeat what Ivan mentioned at the beginning of the call.

Yes. It was just to get a sense, I guess, of what FX assumption you're using and the sensitivity of it to movements in the U.S. dollar?

Well, as a general assumption, we are using CLP 900 per U.S. dollar, yes. Rule of thumb is 50% of our CapEx is peso-denominated that's vary quarter-on-quarter, it depends on the specific activities that we are doing. But in general terms, 50% is a good proxy. So we have a variance of -- we have an exchange rate over the first half in the space of CLP 950, CLP 960 per dollar, so roughly a 6% positive movement for our CapEx during the first half. In the second half, we see if we remain with a weaker than CLP 900 per dollar, we will also capture the benefit of potentially capture the benefit of this exchange rate in our CapEx in the second half.

Thank you. There are no further questions. I therefore, hand back to Ivan for closing comments.

Okay. Well, thank you very much all for attending and joining the call. As I've mentioned initially, it's been a good first half with strong financial results and also operating performance, especially on cost and our project delivery. So we continue on track to execute our strategy, and we will continue, therefore, to focus on the same points during the second half for delivering our annual results. So again, thank you, and have a good day.