00:00You said in the statement the company this new company will assist in building the company's capital markets profile.
00:06Talk to us about what the strategy means or what the strategy looks like moving forward.
00:11Yeah thanks very much and good morning. The strategy is really predicated on three fundamental things.
00:17Operational excellence really creating sustainable shareholder returns and really thinking through the fundamentals for the PGM market
00:26and how we can create future demand for the products that we mine.
00:31And so when I think about operational excellence that really has been focused around really creating value from the assets that we have within the portfolio.
00:39So both our assets here in South Africa and then also in Zimbabwe so Michalikwena, Amandebult, Mototoro and Unki
00:46and really then also the integrated value chain that we have.
00:50So we go from mine all the way through to refining and we believe that given the resource endowment that we have
00:56that we can extract further value from that. And then as a company going forward we're really focused around value over volume.
01:04So really creating that value from the assets and then being incredibly disciplined in our capital allocation
01:09and therefore thinking through superior shareholder returns as we embark on our new journey as Volterra Platinum.
01:15What are you looking to do in terms of value? Like where are you investing in to ensure that you get the most value within this new spinoff?
01:23Yes. So as I said, we've got an incredible endowment in multi-decade life assets in the PGM sector.
01:30The assets that we have are really world class and therefore our opportunity is to extract the value from our existing asset base.
01:39And so we're focused around continuing our exploration at Michalikwena and potentially going underground at our Michalikwena mine
01:46which has a life in excess of 80 years. We're also focused around extending the life of the mine
01:52at our Mototolo operation on the eastern limb in South Africa and then also how we extract further value from de-bottlenecking
02:00and optimizing our processing assets. And we're looking to repurpose one of our smelters in order to continue to treat material that we have.
02:08And that's where our key focus is in addition to not only coming back to that operational excellence
02:13and ensuring that all our assets operate sustainably in the lower half of the cost curve
02:18and then continuing to generate positive cash margins even at the low point in the price cycle.
02:24Well, I'm glad you brought up the price cycle because last week we did see platinum prices enjoying a bit of a rally.
02:29How do you see the broader context of what we're seeing, the macro conditions affecting the business right now,
02:36especially as you're looking to the spinoff?
02:40Yes, so we're in the we're in the mining industry.
02:43So price volatility and PGM volatility is is is a fact of life.
02:47And we've certainly seen the PGM prices rise from 2021 and 2022.
02:54And they've come off those highs in 2023.
02:57And so we see that volatility continuing, predominantly driven by market macroeconomic market uncertainty,
03:05as well as just some general sentiments around PGMs.
03:10But importantly for us is what we can do as a business is really focus on what we can control.
03:15And that's how we deal with that volatility.
03:17So therefore focused on our cost optimization program, capital efficiency,
03:21where last year we delivered 12 billion rands of cost and capital savings.
03:26We've got another 4 billion rand program, certainly places all of our assets in that lower half of the cost curve.
03:32But in addition to that, so not only through operational excellence,
03:35just how we then maximize the revenue from the minerals that we mine.
03:39So not only are we focused around PGMs, but we're also focused around chrome,
03:44our base metals from nickel and copper.
03:46And we also produce gold, which also certainly in the current price environment helps support our cash flow margins as a business.
03:53So you believe right now current market conditions are actually beneficial to the business bottom line?
03:57Is that what you're saying?
03:58So I fundamentally believe that PGM prices should be higher than where they are today,
04:02just given the deficits that we see within the market and a positive outlook for PGMs,
04:08given sort of the changes in the nature of the energy transition.
04:11And so certainly I think, you know, once we have greater stability from a global macroeconomic perspective,
04:18you'll see sort of prices recover.
04:21But that being said, I really focused around what we can control.
04:24And we're also as a company going forward focused around market development.
04:28So how can we diversify the products that we mine and sell to a broader market?
04:34And how do we think through that energy transition as well?
04:37So can we play in the space of hydrogen, both generation and also mobility?
04:44How can we think about our role in sustainable fuels?
04:47And also how can we use batteries?
04:49How can we use PGMs in battery technologies?
04:52And all of those aspects, we as Volterra Platinum will continue to invest in and look for those new diversified markets.
04:58So does EV, electric vehicles, ultimately get in the way of those future aspirations?
05:04Because a lot of your metals are based on gasoline and diesel products.
05:08So certainly, you know, EV, the battery, pure battery electric vehicles today don't contain any PGMs.
05:15And we're looking at how do we then, opportunities where PGMs can be used in the future in battery technology.
05:21But that being said, I think the energy transition is going to take us a lot longer
05:26and it's a little bit more, a little bit different to how it was sort of planned out 12 months ago.
05:33And as a consequence of that, PGMs have a positive role to play in, you know, in hybrid vehicles,
05:39in, as I said, in hydrogen and the generation of hydrogen,
05:43but also, very importantly, looking for other markets where we can utilize PGMs in other industrial applications,
05:50such as we can continue to see that demand for PGMs into the future.
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