Welcome to Liontown Resources June quarter results call. Following the formal presentation, there will be a Q&A session for investors, analysts and media. Participants can ask both text and live audio questions during today's call. [Operator Instructions] If you have any issues asking a question via the web, a backup phone line is available. Dial-in details can be found on the request to speak page or on the homepage under asking audio questions. To view documents relevant to today's meeting, including more detailed instructions on how to use the platform, select the document icon. A list of all available documents will appear. When selected, the document will open within the Lumi platform. You will still be able to listen to the meeting while viewing the documents. [Operator Instructions] I will now hand over to Mr. Tony Ottaviano, Managing Director and CEO of Liontown Resources.

Good morning, everyone, and thank you for joining the Liontown quarterly and our full year results presentation. Joining me is Graeme Pettit, our interim CFO; Adam Smits, our Chief Operating Officer; and Grant Donald, our Chief Commercial Officer. If you can move to the first slide, please. It's the usual disclaimer. And now I'd like to set the context for today's presentation. And before I do that, I think it's important that we sort of reflect on the year's just gone. I mean we started production in July. But if we look at the macro environment, we've seen the price of spodumene for 36% and it's fallen even further in the last quarter. But notwithstanding, we've seen some green shoots in the last couple of weeks. It's a very volatile environment, and it's just best reflected by the fact that the spodumene price went up $60 a tonne on Friday, and it came down $50 a tonne last night. This is the macro environment we've had to ramp into. And what we can control is the way we perform and our business, and we've got to execute and execute well. And we've seen that through 2 operational levers that we've had to pull. Firstly, our business optimization, and we've got a slide in that today; and secondly, the performance of the plant. We've effectively ramped up the plant in 6 months and then had 5 months to optimize the plant so that it can treat our strategic stockpile that we've spoken about. And we've valued that stockpile 6 months ago at $93 million, and that stockpile is a combination of our open pit, some underground ore and our OSP material, which is effectively our low-grade high gabbro material. So the plants had to -- we've had to tune the plant in order to understand the operating settings that will see us go into FY '26. And notwithstanding that, if we look at our demonstrated capability, we've delivered 320,000 tonnes of concentrate in 11 months. which is an outstanding effort for our plant in ramp-up. And that's [ 294 ] on a dry basis because that's what we get paid on. But in terms of physical production, we produced over 320,000 tonnes. The underground operation has commenced on schedule. We've delivered $125 million of cost savings in deferrals against a $100 million target and with a robust cash balance of $156 million, and we've delivered on our second half guidance for all-in sustaining costs. But even more pleasing in this last quarter, our net cash flow from operating activities was a record of $23 million. We've also provided in this presentation our look ahead for FY '26, and we've said for some time that FY '26 is a transition year as we bring the open pit to closure and we wrap up the underground. We've also had to continue our business optimization because of the market and the way it is. And then finally, the last point, we must maintain a relentless focus on maximizing value, the focus on cash, and we'll continue to do that in FY '26. But we've also got one eye on the future. And all our expansion options are preserved in the event we see a market rebound. Next slide, please. Next one, please. Okay. Here's a summary of FY '25. We've further strengthened our ESG credentials. And we've got a slide that shows that today. As I've mentioned, we've produced over 320,000 tonnes of concentrate, and we've done that in 11 months, and the plant has ramped up and performed reliably and has given us flexible options, which we'll talk about later in the presentation. We've commenced our underground operations, and there's no surprises there. Things are progressing well. And those of you that are on the site visit on Thursday, you will see that firsthand. And we're on track to conclude our underground operations in the end of this year, and we're responding very quickly to a volatile market, as demonstrated in our cost savings to date and the way with preserved cash. Next slide, please. Okay, ESG. At a headline level, we've hurt less people this year than we did last year. In fact, we've hurt less people in the last quarter than we did last year. But the results are not where they need to be, and we will continue to focus on this. It's an ongoing focus, actually. But the pleasant thing is not only are we focused on lag indicators like TRIFR and lost time injury frequency rate, we're also getting our leadership focusing on the lead behaviors, the observations that we need to do, the field leadership we need to do. On the ESG front, Consistently, we are delivering between 79% and 82% renewable power into our operations. There are times where we run solely on renewable power for a day or so. And our diversity, we continue to maintain the focus on getting in equality of gender in our workplace. But more importantly, diversity of thinking. Next slide, please. So I will now turn to Adam Smits, who will talk through the physicals that we delivered not only for the quarter but also for the year.

Thanks, Tony. Good morning, everyone. I think the #1 point I'd like to make, really in this slide, is that, as Tony has already alluded to, we've only been in operation 11 months. That's not a defensive comment, that is just a statement of fact. And these figures very much reflect, certainly, the annualized figures, reflect the annualized, and how we've done over the last 11 months from start-up of a brand-new operation with a brand-new team, with a brand-new plant, and ramping it up at that time. In terms of the quarter that's just gone, just over 85,000 tonnes of concentrate, produced sales of just under 100,000. Lithium recovery this quarter was a little bit down versus Q3. And we flagged that in Q3, where we said we were going to deliberately reprocessing our OSP, and I've heard a little bit about that later in the slide deck, we processed just over 600,000 tonnes of ore through the processing plant. That's a run rate of about 2.5 million tonnes per annum on an annualized basis. And June alone represent an annualized run rate of about 2.7 million tonnes. So you see you've got this brand new plant that is already running at not far off nameplate. In terms of the year, as Tony has alluded to or mentioned, 320,000 wet metric tonnes of concentrate produced in 11 months. Without being anecdotal, we don't know how many more start-ups to produce that in the first year of operation. Concentrate sales of just under [ $300,000 ] annual recovery, 58%. And that was a tale of 2 halves. So half 1 was 55%, half 2 was 60%. We processed just over 2 million tonnes, again, a tale of 2 halves. Half 1 was about 0.8 million, half 2 was 1.2 million. So you can see that the steady improvement and the continuous improvement in the plant through that period. The other thing that isn't on this slide, but it's really critical to mention, and I think it really reinforces the money and the time and the effort we spent in the early phase of the project is our availability for the plant for the second half of '25 was 93%. So just think about that for a second, brand-new processing plant, 93% availability, and very much the newness is worn off in half 2. So not only was it built well, but it's being maintained and operated well. And I think that's a key point to make. In terms of next slide, please. In terms of underground, this is very much a key focus of everyone, Tony down. And the key focus is getting that underground to ramp up because, as Tony said, the open pit finishes in December of this year. An underground is very much about being ready. You can't just turn an underground mine up and expect it to produce the tonnes. You have to plan, and we've been planning for years to be where we are today and the infrastructure that's going in. And the development that's going in is all planned well and truly in advance. What we are seeing now that we're at underground, and we have done significant development is the ground conditions are excellent. We thought they were excellent from the geotech work. They're proving to be excellent. Our mission bolting and the ground support we're putting in is per the budget. We've had no surprises. The initial stopes that we've drilled and blasted and mine now are sort of running between 4.5 and 8.5 tonnes per meter of drilling, it's what we planned. We're getting great fragmentation. You can see that in the bottom left picture. Our enabling infrastructure is on track. There's $100 million in that paste plant between the contract we led and the owner's costs. That's Australia's biggest paste plant, and it's been being built and commissioned in advance of requirements. Ventilation is now nearing completion. You can see that in the top left picture there. That's a $15 million investment just in ventilation and primary ventilation and probably 18 months to 2 years of planning to have that in place today when we need it. Our productivity underground for the jumbos, we've been touting that for some time. That continues at a pace even though we are now stoping paste filling and doing a whole bunch of other activities underground. We continue to focus on the mine in terms of making it efficient. So we've stuck with our dual declines. We're looking forward to getting some bigger stopes coming through in the back half of '26, up to sort of 40,000 tonne stopes and 80,000 within the next 2 years. And we've already ramped that underground up to a run rate as of sort of today of about 0.6 million tonnes per annum in sort of 3.5 months. In the next 2 to 3 months, that will be closer to 1; and in 3, it will be about 1.5. So it shows there's a real progression of that underground mine and it has to be because the open pit is finishing, and that's where our focus is. Next slide, please. This is something that Tony alluded to back in November last year, we really pivoted in the low-cost environment to focus on how do we pull spend out of what we're going to put out the door going forward. And one of the biggest levers we pulled was coming back on development and revising our mine plan so that we dove down to the high the higher-grade, thicker zones of the ore body faster. What that meant was we took a lot of development out. We slowed the overall development down and it put a little bit more pressure or it made us pivot to processing our ROM and our OSP stockpiles earlier. We reduced our target in terms of what the common rate that we were going to produce from sort of 6% to 5.2%, it makes more money and it certainly save more money in terms of development. And we commenced trial in how we would best treat this OSP material. Now this OSP material is essentially clean ore mixed with the gabbro, which is the host rock, in anything between 5% and 30-plus percent. And for those that are not aware, that gabbro is very, very, I guess, negative in terms of processing recovery, it's hungry and power and it's hungry and reagents. In terms of I guess, our peer companies that run DMS and DMS float circuits, they simply cannot process much over 5% because of the actual SG of the gabbro is very near the SG of the spodumene. So you literally -- you have no selectivity. What we've demonstrated over the last few months is our ability to not only sort which many others are doing, and there is some benefits of ore sorting. But we've also demonstrated the ability of the plant to take direct OSP feed in levels of north of 20%. And the graph to the right there shows that we're still making salable grade concentrate at levels 15% to 20% gabbro. This is truly, truly, truly impressive reflects the massive effort of the team on site, and it reflects the flexibility of the plan to handle this type of fee. And it gives us another lever to pull in terms of what we do with the OSP. The OSP is a very much a finite issue. It's very much an open pit mining problem to have. And if you ask any of our peers that have open pit mines, they will tell you that. We're certainly not seeing that percentage of OSP coming from underground. In fact, quite the opposite. We continue to work with an OSP and we'll do for the first half of 2016. But I guess the messaging to all that are listening is that we have a plan, and we've got it under control and we're making it work. And not only are we making it work, we're making it work well. I think I'll hand over to Graeme at that point. Next slide, please.

Thanks, Adam, and good morning to everybody on the call. This slide outlines some of the key financial highlights for both the current quarter and also the year-to-date. Starting with cash, we generated positive cash flow from operating activities for the quarter of $23 million, which was particularly pleasing given the challenging pricing environment. This is the third consecutive positive cash flow from operating activities reported since the commencement of operations just under a year ago. Our closing cash balance remained strong at $156 million and excludes the return of $25 million used to cash back the guarantee facility that was mentioned in last quarter's presentation. These funds are now expected to be received during the next quarter. Quarter-on-quarter, our closing cash balance declined by $17 million or approximately 10%. I'll discuss the movement in the cash balance in a bit more detail on the next slide. Working through the quarterly financial stats. Revenue was $96 million, which represents an 8% (sic) [ 9% ] decrease quarter-on- quarter, and reflects a decrease in average realized price, offset by a small volume increase. The Q4 average realized price of USD 633 per dmt CIF, which was 75% lower than the previous quarter. In dollar terms, the average realized price was $984 per dmt, which represents an 11% decrease Q-on-Q. The average concentrate grade shipped remained in line with the previous 2 quarters at 5.2%. Unit operating costs of $898 dmt sold FOB and all-in sustaining costs of $1,227 dmt sold FOB were mainly impacted by an inventory charge reflective of the drawdown in stockpiles. As we've outlined in the Q3 quarterly presentation, we had expected to see an increase in unit operating costs in Q4 as we reintroduce ore sorting and drew down on stockpiles. I won't spend time on the year-to-date financial steps, but what I want to draw your attention to is the note in the quarterly report discussing ROM ore stockpile valuation. Through the preparation of our FY '25 full year fin stats, we identified the requirement to adjust the carrying value of our oil inventories down to their net realizable value. The adjustment of between $75 million and $85 million is in accordance with our accounting policies and mainly relates to our OP inventories. I just want to make it clear that this is a noncash accounting adjustment and is driven by the current low lithium price environment. The write-down does not impact our reported unit operating costs or AISC and the production of OSP, as Adam mentioned, is mainly associated with the open pit mine, which is scheduled for completion in December 2025. Next slide, please.

Just before we go off the slide, if I can just reinforce a point that Graeme has made, that $23 million of net cash from operating activities, is the highest figure we've received -- we've done so far. But that is on the backdrop of a price that has dropped $75 a tonne our realized price. So to put that into context, it's a better outcome at a lower price, and that reflects the business optimization work and our focus on cash.

Thanks, Tony. Next slide, please. This slide has a cash flow waterfall that broadly shows in chart form the same information that is in the 5B cash flow statement that we released today. We provided an additional split on investing activities to clarify the working capital benefit of drawing down on stockpiles. Starting at the left of the waterfall, we had a positive cash flow from operating activities of $23 million, as we've outlined. As Adam mentioned before, the underground mine commenced production stoping during April. So this is the first quarter where we have started to see some underground mining costs flow through the operating cash flows. Cash flows from investing activities was $49 million for the quarter, and we've provided an indicative split based on the cost weightings. Growth capital was estimated at $30 million and mainly covers the initial tailings storage facility construction costs and underground infrastructure and development costs. As mentioned, underground operating costs are starting to flow through the operating activities. However, given where the underground is at in its development and ramp-up, it has not reached commercial production for accounting purposes and is not expected to do so until Q3 FY '26. Sustaining capital mainly related to open pit deferred waste and mining capital projects. The open pit is planned to continue to focus on waste stripping throughout the next quarter before reaching the final major ore zone in Q2 FY '26. Cash flows from financing included the proceeds of a $15 million loan rightfully received from the WA state government under the Lithium Industry Support program. The loan is interest-free and repayable over 2 years following the end of the interest-free period. We have highlighted a cash AISC of $1,099 per dmt sold. This was done to highlight that our reported AISC of $1,227 per dmt sold for this quarter is being inflated by noncash inventory charges. And as a result, the actual cash unit cost that we realized for the quarter was lower. Finally, we ended the quarter with a strong $156 million closing cash balance and 11,000 tonnes of concentrate on hand. Turning to the next slide, please. This slide outlines our actual performance for H2 FY '25 against the guided ranges. For context, we provided our H2 guidance 3 months after turning on the processing plants and very few producers provide guidance during ramp-up as we have. Running through the cost metrics, concentrate sold in an SC6 basis was 165,000 dmt, which was 3% below the bottom end of guidance, partially impacted by the lower concentrate production. Concentrate produced on the SC6 basis was 155,000 dmt, which was 9% below the bottom end of guidance. This was a result of lower OSP recoveries that initially contemplated when guidance was given, and Adam has covered off how we've been dealing with that. Unit operating costs on an SC6 basis were $931 dmt, which was 9% over the top end of guidance. This was mainly a result of the lower production and higher inventory charge resulting from a drawdown on inventories. Total capital expenditure was $94 million, which is 3% below the bottom of guidance, and partly reflects capital reductions and deferrals from the business optimization program. And finally, when taken together AISC on an SC6 basis was $1,256 dmt, which was within the guidance range. Although there were a few messages to guidance, the outcome should be viewed in the context of a new facility being ramped up and a challenging pricing environment requiring operational adaptations. And to that end, we are pleased with what's been achieved. I'll now hand back over to Tony.

Thanks, Graeme. Just to set the scene, we're now moving to FY '26 and what we're seeing with FY '26. As we've said for some time, it is a transition year, and we're ramping up the underground. So I'll now hand over to Adam that will give you some color as to what we're seeing in FY '26.

Next slide, please. Thanks, Tony. So I think I alluded to it a little bit earlier, but I think that '26 is very much a transition year. The big focus is on enabling infrastructure. A learning for me as a non-mining engineer is how much infrastructure and how much preplanning needs to go into one of these underground mines. And our team certainly, many of whom have been onboard now nearly 3 years, have certainly done that work, and that's why the infrastructure is coming on as planned in this quarter. So that includes the ventilation, which should kick off in about a week's time. The first big vent fans will be brought online. Our bigger stopes will kick in, in the back half of 2026 where we're talking north of 40,000 tonnes per stope, and that will enable us to get that sort of ore delivery out of underground that we need to support the processing plant. We're looking at completing the open pit on schedule in December this year. The better ore from that pit now comes out in October and November and December. That's a project -- or that's a contract that was let nearly 3 years ago that basically has finished almost within a month of the date that we ordered it. So it's a pretty stellar achievement by Pete and his team with the open pit. We're still targeting a recovery of over 70% in Q3. People may ask, given that we're 57% for the quarter, how we're going to do that. It is very much ore related, and I've got a slide that talks to that. Clean ore equals better recovery, and we've already demonstrated that in Q3 of '25. And all of our ore will be coming from underground as of Q3 and '26, and we're on track to achieve that. In terms of the processing plant, look, we think our availability is best-in-class, 96% feed on, feed off availability is truly sensational. We're restructuring the ROM pad currently. The ROM pad initially was set up as an ore stockpile, given the way the ore came out of the open pit. It is now being very much set up around feeding the crusher and reducing tramming distances. The processing plant had a lot of tech built into it when we started up, including an onstream analyzer from Metso. That technology has taken us a while to get it to work, and it is now working. So we are now trending lithium online. But we haven't stopped there. We've continued to spend money and deploy capital on things that make sense. So we're just through the final stages now of an advanced control system on the mill called [ Manta ]. That enables us to control grind significantly better than just the standard PLC. We've also just installed what we think is Australasia's first online particle analyzer using cameras in pipes that give a particle size distribution every 20 seconds. It's pretty revolutionary technology. But we continue to push these types of projects through. And you may have seen a recent video where we're talking about a regrind mill, that should be commissioned in August, where we're looking at regrinding a fraction of our tailings, again, focused on recovery. And we continue to refine how we process that OSP. OSP is a very finite issue, as I mentioned, but we continue to focus on what proportion we saw, what proportion we feed and whether we blend or direct feed to the mill. Next slide, please. I mentioned earlier a tale of 2 halves; '26 is very much a tale of 2 halves. Half 1 is very much focused on processing those stockpiles, completing the open pit and bidding in the underground. That's half 1. Half 2 is very much focused on ramping that up at underground and really cashing in on the benefits of that clean underground ore. And that's why we're so confident that we're going to get that sort of 70% recovery based on the work we've already done, processing straight underground ore through the plant. So first half of '26 is obviously ramping down that open pit production. So we finished in December. We still got about 400,000 tonnes of clean ore to come out of the pit. We're continuing to focus on maintenance. We just had a large maintenance shutdown in the plant. That was not maintenance per se, but a lot of it was actually improvements to the plant to make it even better, and we continue to optimize that OSP strategy over the next 2 quarters. In terms of Q3 and Q4 of '26, it's all about scaling up that underground. The underground is very much about scalability. We've got -- we've built that scalability into it in terms of the dual deep declines, the level development, and even the equipment mobilization and the contract we put in place over 2 years ago with Byrnecut is very much around geared or structured around ramping up the underground. And we continue to focus on availability. To put that in perspective, the underground is sort of producing, say, 70,000 to 100,000 tonnes a month currently, and 36 stopes in the first half. It will be ramping to 100,000 to 170,000 tonnes per month and about 48 stopes in the second half and then that ramps up to 230 tonnes a month in sort of 80 to 90 stopes annually in '27. So you can see there's a plan. It's the same plan that we've had in place for a while, and we continue to execute that plan. and we continue to be ahead of the plan. I think that's a key learning or a key driver of how we've always gone about business at Liontown is to be ahead of the curve and ahead of where we need to be. And that's where we are or we believe we are with the underground in terms of the infrastructure, the people, the systems and just the general ramp-up that we're pushing.

Thanks, Adam. If we turn to the next slide, Adam's got one more slide to do, but I do want to say I want to thank Adam. This will be his last quarterly with us. And I'm deeply indebted to Adam and his tireless commitment to the organization. And you can see he loves the technical stuff. He is the engineer's -- he is an engineer. And I can say that because I am one. So I want to thank you, Adam, for your work you've done and the way you've set us up. Okay. So we move into FY '26. There's a lot of stuff that we've already discovered, but there are 2 points that I want to draw out here. Firstly, the first half and the continuous focus on the OSP and getting those stockpiles out of the way, so we can set ourselves up for the really prime and good quality underground materials so that we can maximize our recoveries. The second bit is the Q1 scheduled shutdowns for the mill and the dry plant, that's planned. We've been operating the mill for over a year now, and we needed to go in and do the scheduled maintenance. But if you look at the actual parameters for FY '26 and the guidance, I mean, the production, if you take the midpoint, it's a 39% increase from this year. So it is a significant increase. And then a lot of that costs associated with drawing down stockpiles, but again, the focus on cash maximization Okay. And there's no change to our recovery target and our underground planned production. So if we move to the next slide, please. And we'll ask Adam to finish off on this one.

Yes. So I guess one of the key mine takeaways for '26, it's really a transitionary year, and that's to be low cost and scalable by '27. So the plant or the underground is designed for scale. We've derisked or we are derisking progressively the underground, and we've been doing that since day 1. And the target of underground is always a lower cost per tonne. And what do I mean by design for scale? We put dual declines in from day 1. We know we've got big stopes, and they're coming. They're coming in half 2 '26, where we crack the 40,000 mark and up to 80,000 in the next 2 years. So that's 80,000 tonnes from a single stope versus the smaller stopes we're hitting now, which are around the 10,000 tonne mark. We also hit the bulk levels where we've got over 125,000 kilotons of material per vertical meter. And you can see the annualized production run rate. So we're already at about 0.5 today, 0.6 actually, by the end of this month. We're going to crack 1 million tonnes in the next couple of months, and then at the end of March, about 1.5 million tonnes. And that comes with a combination of equipment mobilization, systems and actually a lot of prior planning and a lot of development that we've been doing over the last few years to drive that type of ramp. It doesn't come just because you throw a few more bits of equipment down underground. It becomes because you've actually got a plan for it. You can't -- and you can see this in other companies' results over the last sort of 12 months. If you don't have the levels available, if you don't have this space available on the ground, you can't physically ramp that underground up. And we've planned for that from day 1. In terms of the derisking, I think a lot of derisking has focused heavily on infrastructure. It's focused heavily on people. And where we've seen gaps, we've bolstered the team, and that's happened in the last quarter as well. So we're pushing very hard, not only on the physicals, but also but also the people and systems. And what does all that give us? It gives us that lower cost per tonne. So '26 is very much about development. There's a lot more development going in underground. There's about 12,000 meters going in -- [ 8.5 ], sorry, going in '26 versus sort of [ 7 ] in the last 12 months. And that's very much focused on staying ahead of curve. And then we're obviously ready for that expansion, [ 2.8 to 4 ]. We haven't lost sight of that. It's very much price dependent. And look, where the price goes is where the price goes. But certainly, the mine has always been designed to expand, and we've just got the ability to turn that on and off. I don't think there's much more to say on that.

Thank you, Adam. So if we move to the next slide, please. And this is where we sort of wrap up, the continuing relentless focus on maximizing value. If we go to the next slide, please. So we promised the market that we would deliver on our cost-out targets, and we delivered $112 million compared to a target of $100 million. So the split is $71 million, which is recurring, and then $41 million as a result of deferring. And a lot of the deferral was due to the North-West Flats being pushed out and all the development costs associated with North-West Flats. But in '26 the focus continues. We've got our -- the market is what it is. And if we look at where we will tackle this next horizon of cost optimization and business optimization, it will be around better sourcing of our product and our consumables, buy better, improve the outcomes of our top 10 contracts, a lot of them done during the peak market and removing waste and duplication in our processes and activities, okay? So we've got our program underway at the moment, which will continue through '26 and deliver outcomes. So if we go to the next one, please. Okay, now I'll turn over to Grant Donald, who will take us through the next 2 slides. Thank you, Grant.

Thanks, Tony. Look, we thought it was worth emphasizing the extremely attractive debt package that we secured from customers. This is covenant light, and it's a real differentiator for us versus bank debt or project finance debt. If we can start with the forward facility, the AUD 300 million debt facility had no interest payments until the offtake to which means the accumulated unaudited balance is at AUD 336 million as at the end of June 2025. The term is 5 years from the start of the offtake, which was agreed at Ford's request, to be 1 July 2025, meaning the debt matures in June 2030. 60% of the principal is amortized over the 5-year term, with a 40% balloon repayment at maturity. The interest rate is 1.5% above BBSW, which is equivalent of over 5.6% today. And the first interest and principal repayment is due at the end of September 2025, now that the offtake has commenced. Moving to the LG Energy Solution convertible note. This is denominated in U.S. dollars to match our revenue line. Again, a 5-year term, it's $250 million equivalent to around AUD 370 million at the time of conversion. The share price conversion is AUD 1.80 and interest rate on this is SOFR flat, which is currently around 4.3%. This also has biannual interest, which is capitalized for the first 2 years, after which Liontown can pay in cash or equity until maturity of the facility in July 2029. Deciding to use customer-backed financing to build Kathleen Valley has given us really good alignment with customers who also want to secure the product for the long-term supply chains that they're building. We believe this is a competitive advantage versus where we would have been if we've taken a traditional debt finance from project financiers. Next slide, please. We'll finish on the market. In the short term, we are beginning to see signs of a policy shift to halt the rational competition, or involution as it's termed. This shift was signaled by Premier League Chang at a state council meeting in mid-July. And this year, it's specifically referenced as it relates to the EV sector, emphasizing a shift towards quality and innovation as opposed to price cutting. Local authorities have also been directed to discourage overinvestment in redundant projects, and this is built through to a number of audits or restrictions placed on lithium producers in China, which is impacting the supply side. You can see the very tangible impact of these stories on futures exchange in China on the lifetime chart. On the demand side, the company continues to see robust outlook for lithium underpinned by strong demand for high-quality spodumene concentrate. In the first 6 months of 2025, lithium demand has continued its double-digit growth rates, driven by strong electric vehicle sales and battery energy storage systems. Global EV sales increased by 28%. Now to put that in context, that's the equivalent of 2 million more EVs sold, taking the total to $9 million sales in the first half. And the silent sleeper here is really the battery energy storage systems where installations have increased by 54% year-on-year. BESS is set to be a very material driver of demand on a go-forward basis. And we tried to show this in the chart on the right-hand side to show you that 1 out of every 4 incremental units of lithium demand over the next 5 years is going to battery energy storage. So in summary, our view is that the current fuel price environment really reflects an evolving supply-demand dynamic. And as we anticipate a return to more normalized conditions as demand continues its robust long-term growth trajectory. Thanks, Tony.

Thanks, Grant. If I can go to the final slide before we open up to Q&A. Look, just to summarize our position, as the CEO, I'm very proud of what we've been able to achieve since we started production in July of last year. And we've had to battle that ramp-up against a very, very tough low price environment, and I think the team has done an outstanding job in getting us there. The focus has been where the focus should be, and that is to perform well to -- and operate as best we can with preserving cash, and we've done that with a cash balance of $156 million at the end of June. We know what we got in front of us in FY '26. Adam has already articulated how we've planned and we're well positioned to deliver on those outcomes. And finally, the relentless focus on maximizing value should be a theme regardless of the market, but even more in sharp relief as we're entering this period of uncertainty. So with that, I open the line for Q&A. Thank you.

[Operator Instructions] Our first question comes from Adam Baker from Macquarie.

Just very interested in the slide on Page 14 with the underground ramp-up. With your run rates getting to that 375 kt by the 3Q FY '26, and then you've got your progressive ramp-up to the 2.8 million tonnes by the 4Q FY '27, just wondering what sort of drop off we see in the milling rates in that first half of FY '27 as you kind of dovetailing that ramp-up in the underground and that's offset, obviously, by the reduction in stockpiles and the remaining open pit material, what kind of percentage of the reduction in throughput plant capacity that would be?

I think there is no drop-off, no ramp -- it's -- we're trying to keep it steady state is how we're managing the stockpiles and the transition.

So the mill rate will [ include the ] underground production.

Correct.

Okay. Just it appears just on the Y axis, it's dropping off a little bit, but maybe that's just my...

Yes, very much is yes.

The annualized rate is pretty stylized, but the annualized rate for '27 is 2.8.

Thank you. And then just secondly, on the offtake with Ford, I just saw that there was an agreement to resell 150 kt of spodumene. Do you think there will be any future agreement to resell more spodumene offtake? And secondly, if that occur, would there be a change in the timing of the P&L repayments?

Go ahead, Adam.

Yes, look thanks, Adam. I guess the reality is the EV landscape has changed materially over the last few years. And we saw an opportunity for us to place these tonnes on behalf of forward with another customer who wanted the product. Ultimately, that is ongoing business as usual as far as we are concerned. If we see an opportunity to place product with a different customer for more value, and it works for everyone, then those are opportunities we would pursue. I don't think that necessarily is any potent of the future. I think that's just what we've done in the short term given the current demand position that Ford has for its own internal consumption.

The next question is from Hugo Nicolaci from Goldman Sachs.

Congrats on your first year of production. First one for me, Tony, you've always focused on doing volume and cost on an SC6 basis, noting your FY '26 guidance today is on a 5.2% basis on production and costs. Why is the change?

Well, we've been consistent with the rest of our competitors. We found that it's been a challenge to continually revert to SC6. And really, frankly, if the product we're producing is 5.2%, that's the cost structure that it's based on. So it's basically falling into line with the rest of the market.

Yes. Got it. So we've kind of moved to the same as everyone else does. That makes sense. On the cost savings piece, you've touched on it a little bit already. Can you just confirm whether you've now changed rosters and reagents already and if that's in the $71 million of recurring savings. And then maybe just elaborate a bit more on what magnitude of cost savings you expect to get through FY '26 from buying and sourcing better and removing duplication.

Yes. So the rosters remain unchanged. So it's not included in that figure. The reagents, we still have the reagent that we've been using. We've been playing around with consumption rates. So there is still an opportunity to look at an alternative reagent, but we need to do a bit more test work and that's planned for FY '26. In terms of a target for FY '26, we haven't put anything out there because we're still working it through to establish the size of the prize. So until that work is done, Hugo, I'm not prepared to put a target out.

The next question is from Lyndon Fagan from JPMorgan.

Just looking at your cost guidance, I guess, if I take the midpoint -- multiplied by the midpoint of production, we've got site costs just under $400 million. I'm wondering if that's kind of setting the benchmark going forward to operate the site. Obviously, underground ramps up, open pit ramps off. I mean, maybe you could give us a bit more of a sense of what the dollar million looks like as a pure underground. Just trying to get a handle on this number to try and forecast forward.

The $400 million is a fair representation of the gross costs going forward. Underground basically replaces that open pit for FY '26 and we're well around broadly within that $400 million range.

So Volume goes up?

Yes, volume goes up. So volume goes up a bit.

The next question is from Kate McCutcheon from Citi.

So the next 2 quarters, you've got the OSP material going through. In your all-in sustaining cost, what is that stockpile adjustment component, please?

So just so I'm clear, Kate, are we talking about the adjustment to the carrying value of the stockpile or we're talking about how much of the unit cost is the inventory piece?

The latter. So in that dollar per tonne AISC amount is the stockpile adjustment? Yes.

Got it. So Kate we estimated between $40 and $50 per tonne on an AISC basis.

And then in Slide 16, you've told us that you expect FOB costs to come down 20% to 25% in '27. So that implies a little over AUD 800 a tonne, which is kind of similar to Lyndon's question, is that level of cost out? Also, how we should think about all-in sustaining costs? And would it be unfair to assume that's a level going forward?

So a lot of the drop in FY '27 is because we start getting efficiencies. A lot of the mining costs underground are fixed. And as we ramp up volumes, we wash the fixed costs more cleanly over more tonnes. From a sort of go-forward perspective, I think, I mean, as you can see in the middle chart there, we do have higher capital development costs at the moment, and we expect those to moderate over time.

So as we've previously -- just to build on what Graeme said, Kate, as we move into the thicker bulk zones of the ore body, which we anticipate doing in the back end of FY '26 and into '27, we will definitely get economies of scale. We will be able to wash over the fixed cost of the contract mining over more tonnes as we get into those larger stopes.

Yes, sustaining on a gross basis will drop over time, yes.

The next question is from Glyn Lawcock from Barrenjoey.

[indiscernible] for you.

Sorry, I missed that Tony, you broke up.

I just said that you noticed we did that cash flow -- cash calculation for you in our cash flow guidance.

Very much appreciate it. Good to see you appreciate my skid math, Tony?

Yes, we did.

Which everyone is talking about now, just not calling it skid [ maths ] but if you go back to Lyndon and Kate's question, so it's $400 million spend. Your inventory movement actually sits in your cost of production as per your prior guidance, I assume. So the $400 million, given you've got -- or you had $100 million of inventory, your $40 to $50 a tonne inventory movement, to Kate's question, only suggests $20 million. Is that right? I would have thought the $400 million, you should be out of put quite a bit of inventory down, wouldn't you over [ $26 ]. So ] what is the dollar-million figure that you expect will be inventory movement?

I don't have that number with me, Glyn, but the estimate of $40 to $50 is over a higher sort of sales base. And it's -- we only been get -- we consume most of those inventory units in the first half, yes, apologies, I don't have the gross number.

The way to look at it, Glyn, is the inventory drawdown will be an exercise in 2 halves. We'll have a lot of it in this first half of FY '26. And as you can see from our results of FY '25, we did a drawdown in FY '25. So as we ramp up the underground, there will be much more pulling coming out of that inventory. But then in the back half of FY '26, it will be predominantly fed from the underground.

And the other thing to note is that we do build inventory over time. So that $40 million is a net inventory charge that rolls through. So you don't see the full WACC of the drawdown.

I guess I'm just trying to -- if I run a very simple model of the midpoints of all your guidance, including CapEx, et cetera, plus all the interest payments, principal payments, you're going to spend over AUD 660 million this year before inventory adjustment. That means your breakeven is about USD 1,050 a tonne on an SC6 equivalent basis, just based on your guidance, just running the skid math. So you haven't had chance to do that.

So I assume you're right, so -- what's the question?

So I guess that would -- at today's price of $800 a tonne cash burn of $100 million, got $156 million, so that's fine. I guess, just like what are you doing? You've got your extra $100 million of debt you can -- you're allowed to get, maybe you can get forward to defer. I'm just curious what are you doing to make sure your additional liquidity?

Okay. So that's the question. Okay. Well, look, there's a couple of things we're going to focus on. Well, clearly, we're going to focus more on cost optimization, and we're going to put it lever. The second thing is we've got a strong balance to start with, $156 million. Thirdly, we've got track record -- well, there's a bit of a price improvement, but we've also got a track record of finding funding solutions with our customers and other parties, right? So we will continue to look at those funding options as we progress forward as simple as that. But it depends really on where the market goes.

Yes. And Glyn, just to add to that, I mean we haven't pulled the lever on prepayments like a lot of our peers have done. We -- as we've just demonstrated in '27 and beyond, we have a significant amount of more volumes to place. That could be spot, could be long-term offtake. So we still have quite a lot of options ahead of us.

The next question is from Stuart Howe at Bell Potter Securities.

Just a question, and apologies if this has been asked, but the guidance balance for the first half versus second half, have you got a rough percentage split across those and obviously taking to account the shutdown in Q1. And I assume also costs will be corresponding we conversely balanced to that.

Sorry, Stuart, you're sort of a bit muffled, but can you tell us you want to know what the cost split is between the first and second half of FY '26?

Sorry, the production balance between first half and second half of '26.

Right. Well, it will be more back ended. So I don't have that figure off Nick.

We've got about 170,000 odd in the first half and then 250,000 odd in the back.

And then just on plant flexibility, you obviously pointed to the ability to sort -- use the ore sorting material and process that well. That's great for, obviously, this coming fiscal year. But once you're into underground ore only those flexibility benefits probably fall away? Or are there other ways we can think about how you might be to use that going forward from an underground only perspective?

Well, I think the point that we were trying to make there, Stu, is that the ore sorting product material is essentially an open pit phenomena, where in open pit, about 30% of what you mine will typically report to this OSP category. As we go underground, by definition, we'll be far more surgical in our product extraction, and we won't have anywhere near this amount of OSP to deal with. So we'll just blend whatever OSP material we'll get from the underground will just form part of the blend going forward.

The next question is from Reg Spencer from Canaccord.

Tony, Grant, forgive me if you've covered off on this, but I just wanted to dive into recoveries and the OSP between now and Q3 FY '26. When you expect recoveries to start to pick up. So what you delivered in the June Q should that be indicative of expectations on recoveries in terms of that blend of OSP?

Yes. Good question, Reg. I think we're targeting around 60% to 65% over the half 1 as we progressively put more clean ore in the back of the half. But certainly, Q1 will be sort of 55% to 60% is a real number to use. And then Q2 of '26 will be slightly better. And then likewise, Q3 and Q4. So it's about -- the focus is to get a lot of that OSP done dusted this calendar year. Yes. And that's [indiscernible] ore sorting. So not just straight feed that's why we're...

The next question comes from Andrew Harrington from Petra Capital.

Well done, Tony and team. My question is more about what's happening with logistics. And as you're ramping up, what are your challenges or how smoothly or otherwise are things going with ground transport, the port shipping, what's happening with those costs? If you can provide some color on that, that would be useful.

Yes, no problem. Look, logistics side, we made a very deliberate decision to use Qube. They're very established operators, they are very professional. We're using quad road trains. So 4 trailers has taken 146 tonnes per truck -- road truck. And we're cycling through those. They do a figure of 8 loop between Mount [ Magnet ] and [indiscernible] and then Mount Magnet and Geraldton. So everyone gets to sleep in their own bed. The logistics so far have been extremely smooth and efficient. Of course, Geraldton is known for having some swells and weather activity. But that's all just part going out of Geraldton. So on occasion, there's a bit of a rush at the end of the year, but no problem so far.

And I think to add to that, a key part of that contract with Qube, which not only the logistics, I guess, strength, but also the contract included an established shared and facility at the port, which is fairly unique, a previous facility that was built by others. But massive difference to just rolling up as a new customer in the port. So you already had an established outload facility and 40,000 to 50,000 tonnes of storage capacity within the port itself.

Right. Very good. And if I may, a second question. Can you provide some color on movements in terms of sentiment in China and how you view the market? What's relatively small changes in policy seem to have outsized impacts on sentiment at the moment. If you can comment on that would be useful as well.

Yes. Look, I mean, to me, what that basically indicates is that the market is very positioned towards the short end of things. And so there is quite considerable short positions that have built up on a GFX. I think just some of those stories start to come through around supply curtailment that pushed some of those short positions to unwind. But that unwind has actually been taking place a little bit before some of these news flows came on the basis presumably that people felt the market was at the bottom. But look, I mean it's always difficult to tell fundamentally on supply demand. We entered the year with growing 100,000 tonnes of oversupply we get the numbers. There's always different views on projects coming in, but the reality is with the 28% growth we just talked about the BESS growth, we've seen over 100,000 tonnes of new demand just in the 6 months on. So we're probably entering that point now where some of these challenges of getting new products ramped up, new products ramped up, is starting to translate into physical tightness. And certainly, what I see from customers in terms of inbound inquiries and a lot of people looking for a physical product because you can't paper and a battery.

That's all the questions we have time for today. Please reach out to the Liontown team if you have any follow-up questions. We thank you all for your time, and have a great day. You may now log out.

Thank you very much.