MP Materials (MP) 19 Mar 212020 Q4 Earnings call transcript

Good afternoon. My name is Shantel and I'll be your conference operator today. At this time, I'd like to welcome everyone to the MP Materials Fourth Quarter and Full Year 2020 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. you. Thank Instructions] [Operator I Sheehan, to Head time, over the to Martin of would this turn like call At Investor Relations. ahead. go please Martin,

Thank Counsel. Rosenthal, call. and Strategy day, fourth good Chief Financial Executive James you, Officer; to MP and Officer; operator, Materials Materials; Officer Ryan of MP Chief Michael Litinsky, everyone. Chairman Chief quarter Operating me and Sheila With Welcome earnings Bangalore, Officer General today Chief are XXXX and Corbett,

opening Ryan's make remarks, like we that get of to Before States Securities today's under will change you the remind we do facts Private during provisions Litigation certain I'd that safe historical to to statements harbor Reform the United XXXX. not Act call, constitute forward-looking of

predictions, that future and differ future subject and communication. projections forward-looking current expectations to about statements factors statements are actual in events Many and uncertainties. on could are as result, events assumptions, other cause risks to Forward-looking a are from based statements materially this and

For language Factors materially cautionary SEC differ including with Risk more statements, SEC, actual our results in release the forward-looking to that to factors the please refer filings. the in information our from earnings the and filings cause recent section in may about

turn be financial MP During on Jim? and call to in report financial in for found Jim. our Form measures believe not in available to current These is isolation discuss these be with on that, evaluating investors.mpmaterials.com. performance. substitute to the be or GAAP. prepared With a over Materials GAAP MP A certain management today filed considered also in measures, reconciliation accordance the call, I'll website, should most comparable measures the directly of X-K measures useful our will can as non-GAAP which we results Materials operating

full today. And XXXX cover quarter few Martin. Welcome I'm things a our us for going call. today. joining everyone, and to year thanks, Thanks, to fourth

year milestone capping our quarter recap fourth strong for First, MP. results a I'll

Second, to I the at our also II strong well and strong cost of over In which both that perspective how unit production I'll our revenues. Stage production Starting generated continued fourth year-end, benefit current quarter, and records the plan I'll demonstrating on we for some has we on financial environment leverage market for optimization Pass. color Ryan as results clearly as post lastly, Mountain on highlights. positioned the it. update with it a operating volumes we for share And to the on Then turn some These you will are enjoying shipments we're but rise are show basis. pricing, performance.

high remaining are at year facility from significant Also with Mountain at You our of these Pass. also expansion execute fourth can best-in-class and operate the charting since quarter. that a see quarter for to believe we or and continuing we the yields future. illustrate was year the near record both in combined continue effect the to growth awesome performance reported restarting standpoint uptime and and levels margin trends a fourth improvement cost level. the milestone established we've levels We MP's a accounting XXXX we've at

go Stage us sheet know, a execute Fortress gave in we as which you transaction completed public we on As and November, a balance beyond. II

on the II place important across out public company our as and management communications to in final our year optimization other areas. Stage site functions as engineering producer we both of on-site to separated in finance, important out personnel key prepare execute legal, building team. the We We and have currently closed XXX rare employees And scale putting finally, earths become well leading Company steps and also a we as across took by the over to plan. our global pieces

improvements that II and significantly processes Essentially, design product on-spec important recycling. stage to circuit de-risk project invested stage ways Stage in engineering in improve have we implemented reagent production team including technical identified that pass Through expected of improve we the yields, to design. our usage first We II. believe front believe efforts, we our our further efficiencies will now these rates

this The strong achieve the fourth This quarter a ton is a year a REO. is I'd per is We moment we production like upgrades. these in I'm of model of apples-to-apples we Importantly, think the you expected de-risking focused job to and restart ways because on that though reduce year-over-year to cover basis. due tell Chlor-Alkali to details pleased very product significant no roasting facility but operating we site executing to more through of Stage we in crystallizer circuit, growth the other last an team our maniacally assets, I on first, outlined believe longer still commissioning we on reagent will II, streams to remain believe key production. we achievements, finishing need outstanding found XXXX an walk to permanently the this usage doing illustrated by the salt metrics. work XXXX in our

for a volumes quarter And quarter can and full also remains Importantly, the XX% see production the cost in XX% concentrate moment year, while very the in XX%, highlighted we've strong. the I that for ago. fourth demonstrating the increased improvement increased NdPr pricing you demand here by shipment

production costs XX%. year, nearly reduced full on the a For ton per metric by we basis

lead potential to moving initiatives we cash As into contemplate and additional heavy future we're and flows. through the earths, learning evaluating profitability and other significant our progress downstream magnets today and rare rapid we increase move believe including opportunities II initiatives, Stage will to achieving

execution to you, said about Stage of II. on XXXX many is we've As

of move our Stage tons from than NdPr. our rare Upon elements United of be For II strategy, familiar aren't production of expected today's critical those of metric annual America. restoring downstream oxides, production in project we X,XXX will full these is who in to scaling this completion separating rate XXXX, of plan States as concentrate profitable to production thereby with earth toward run more

the in the that we during the normalized process NdPr outlined actually these XXXX full last today spot that $XXX year, target a will be year, is of stated first in though we levels. NdPr going kilo. spot year roughly of price mind EBITDA XXXX public [ph] we last $XX $XX. at million production expect per As assumed Keep

and do owner environmental So said, recent with long-term lead and contract footprint. our potential our our mentality, the project, that unwavering underway. background, operator signed design believe de-risk fixed I'm reduce model pleased track, made significantly our important is procurement site, rest. on long that months, equipment not our we team and to improvements report II enhance is is on that construction That with remains In we arriving price operating engineering Stage

cost followed So for back you estimated those who a million in of we July. of of Stage consisted They in two $XXX II originally project total announced primary us, parts.

is mainly process roasting crystallizer, how The step Pass. decades a in which successfully the first the separation million adding $XXX to to flow to Mountain reinstituting and salt intended restore related it work for

chart capital announced we outlay the indicates, those since changed plans. has this first not As here

profile term to you. that Stage shared and II upon we is was We versus the construction XXXX should also reagents We with no REO and on we capital target had drivers an used apples-to-apples underway focused $XX now Chlor-Alkali of million metric the were what successful Stage a the environmental for have needed structural This Stage disclosed of the achieve process. previously we've on the EBITDA Chlor-Alkali remaining July But to been IIB, which in execution facility already well cost consume II strong near believe normalized restart ton produced Chlor-Alkali The cost. our the completion improve to project the targets. of for the busy. those need lower to refining as basis us per was managing in longer achieve that restart as

improved return processed facility used the further option future potentially So significantly investment us, net let capital and our the steel, in the economy. a reasons for reagents pretty reducing achievement significant of the the despite might Restarting into lumber market, excess for team This when shareholder new it seeing II. materials are this is analyze sell could the high now cases, me process, that I've with in in we Chlor-Alkali opportunity design of operating for open and estimates amount infrastructure remarkable that throughout consistent as is an the original are cost what a the ton enhance prior facility to for we Restarting we means Therefore, some have could particularly but XX%, remains reagents incremental separate you in future consider underway an inflation with one of specific; value. by ROI. acute rapid redesign our like in I potential outlined. costs over have Moreover, now concrete. believe a all the refining improvements be driving the our more expectations cost Stage II Stage per reduce contracted believe for we a REO will

fact, lumber In estimate, XX%. is steel XXX% prices are are July XXX%, our up prices up XXXX since and concrete up

add powerful a to it consider and commodity multi-billion gone asset that cost, particularly we to execute, also in is the of Whatever of lot. demand-driven I dollar thought is would what to it an a is we light come think experience new base. leverage upside prices would say this stages hope against we the the supply As beginning cycle. recently could rising believe that I market from replace difficult in-place commodity up fair has to

Now, the talk highlights. Ryan financial I over through turn it will to to

the everyone. Jim, headlines and of all few press and Jim details we the financial hello, have in our a Thanks, release. of already covered

headline think the The We overview all shipping fiscal spoke also and to QX of the to duties we're and environment, we through for an growth the pricing prices, give realized impressive about for in China thoughts schedules the is and to drove strong import quarter in XX% doubling growth looking I'll the and of of So although or to quarter our in can't on XXXX. the sell quarter, at which our results for percent demand Jim contributed our some the revenues year. lifting how as production. predict has full about continue how and full financial pricing demand higher but the delivered strong of expect we us we year. share

team are and due the the increase continued price productivity the side Michael adjusted down Stage were doing equation, our risk to year-over-year and processes, work Unit to sales mainly his of from ultimately EBITDA I. and benefited to a improve mineral the of continue ton our to to of costs another and reduce excellent addition our are achieve oxides ore earth higher it improvements these process concentrate grade we generating and rare drove which Put higher fad and of per last average [ph]. productivity higher percentages year. way, improvements, concentrate higher recoveries compared In

increase can driver you pricing last costs, As to we our production and effectively our listing. when model our of following in of compared this forward, triple to growth quarter market outlook. in impact the EBITDA feel exists demand includes continue This leverage are Keep and quarter and And the while of these margins be fourth manage mind was that combination we that this the good the see seen public costs strong. about in full roughly unit about impacts six to our will of XXX% costs moving costs per weeks company in EBITDA. our caused year's we QX production

were our and down typical were source our on diversify from plant reagent due work year-over-year, hard partly to these also year-end the materials. although increase full-scale for mid-October this first January the impacted costs, production results project the chain took on an team, and U.S planned in the is into reagent late full-scale based sequential pilot critical Company. of by sustainable important we test lot but with successful to a of enjoy a turnaround, but for supply seasonality a and Lastly it was it We ultimately of embarked quarter achievement

Given reagents chain in all suitable have alternative semiconductors, a we out for issues like was supply critical. the industries seen our proving

these pricing As of per you was slightly would expect for unit for higher trial, REO. a contained volume reagents with commitment a limited

gives now a production similar confidence have per the us come our as at reagent unit of in or supply pipeline the redundancy scheme. current would With that evidenced record better tremendous cost that of success we our

unit the per Stage although in So a to risk well process the was our up costs on worth reduction were slightly QX investment. from I basis,

then process would provide to our so I is appendix and In cash how section flow slide see for our thought the operating you'll from business. dig I our of be flow next EBITDA free flow. it reported see reported walk flow that into free to the and a we slide, the cash useful of our get can reported cash cash adjusted detailed some you how context, the generating Stage On

to our Slide the was the side negative well free and margin X flow our year. our II expected, in Keep the the relevant which balance projects portion flow on optimization million partner for flow But $XX free add pay for one-time cash strong approximately for $XX at to of because if why a the items, of of the financing down, from operating specifically, cash offtake for cash normalized mind, you our chart, as that related comparable Stage statement in million. deal of and left on down believe our is cash spent impact the sales be but CapEx the free we pay as offtake looking to back generated we agreement flow see of per cash the in our GAAP, As instead of as year debt, adjust Stage our it's that free flow the as process retains might essentially XXXX expenses flow cash is very down offtake cash I the U.S metric. through runs XX% that obligation, pay a

a Slide quick balance sheet to update. Moving XX,

our last Stage net work fund proceeds nearly combination a well as at million, quarter, in gross As growth. reported ramp-up on to $XXX of We of we very balance million end we year resulted business discussed us II. positioning cash $XXX our

In quarter. addition, balance million our on in $XX reduced was offtake agreement the the to

about anniversary II, quarter, Fortress earnout all built-in. on which resulting we in outstanding IPO. approximately XX.X the fully will Value investing the approximately stock business net captured table end of shares summary, exercisable warrant combination feel be illustrated as from vested on Regarding improvements We've we diluted the we XX. Jim our May embark the will X million In XXX the noted, as the million method one-year and good stand our at share of million with treasury via in QX. $XXX a Also share outstanding count warrants the Stage where our financially the count, remain on the cost impact with become shares now Slide very headline design on on

'XX production fully of generating to pursue and for restoring chain capacity than as be our are funded strong cash anticipate are our framework. to free supply slide good we with hold, be Stage X. a Stage opportunities we shipping adequately XXXX. So markets we manage for more We on will we see [indiscernible]. opportunistic that also modest implied full Shifting and set to pricing with rapidly, All next flow for said, the mission II volume while the our operating and should we respect how the our particularly from to financial growth fiscal developing currently very up year year flexibility

but we cost to quarter QX doing count a II continue We'll least side our to per corporate up and We our levels prepare continue EBITDA. at sequential gains we revenues growth and as and trend at improvement, reinvest our process be head unit I solid for those produce cost a to optimize continually grow expect of Stage be and with Stage near-record as to is shaping our improved functions.

do cost of Some we the congestion might the we aren't Ports. you the shipper, is impact of given remind any port. Angeles what so always though wondering shipping lumpiness there we also be given shipment not congestion you're reading in outbound about timing Beach Los see at you overall possible will and I that reports Long general at about, material believe from

beginning in is XXXX. $XXX late majority million now the the capital for of the with occurring As capital spend, Stage spend in essentially that ramp cost II

to to wrap it to I'd up. back Now, Jim like turn

extraordinary to We like Thanks, put saw in on help our fortunate years mission have everyone we and build the in asset owner-operator were in moment Ryan. and chain nature reliability. supply we incredibly I electrification confidence its focused remind When a would importance though the of few take Company tough founded an to the unfolding place to a the and opportunity tremendous execution. XXXX, Pass us culture to given of Mountain to to MP. for unique potential in

the We MP a shaping and dollar global industrial are in innings the will the early future. of economy multi-trillion of be a now of part transformation

seasons expected accelerate their our CEO of states can clean best vehicle and just the beyond from counterparts engines. the from hundreds literally globally even is a with But November, are of invested standards IPOs players, trillion exceeds from one de-carbonization eventually people of then technology unprecedented. consolidation every into boom, since more to Herbert the has or or combustion $X the or more and failure electrification Ford maturity, into it us." around useful but along great SPACs some, cars listing I adopted Jeans transition different. course, companies will feels its into follow. Internet, E it be OEMs. now German massive the And Diess, Maybe We ice Here focused it Volkswagen, trillions who and or announcing for likely possibility of automobile other Japanese about Chinese, in plans and that day" serves core shovels and accelerating to picks to like unending the including you "the and on to up Just Blue kind trillion. with be sums excitement fund global role. by be five the mobility The billions more and is battery this other a remind include the faster business next for in legacy from taxis the years believe theme over plus players railroads, auto We away NYSE enterprise It capital any and electrification could multiple most of American Like and no of of the than value California's see several will the become We amounts GM home, planes transformation great and the of even was MP see expected. needs [ph] that. industrial OEMs markets said, aggressive Rush electrification. happening what's Gold "Our pathway from fast. in era that air and trucks whether competition, have capital and going doesn't so

of America them. areas of one few are in resilient, supply there domestic Jeans, supporting is Blue about overwhelming now, certainly chains consensus bipartisan but Speaking right

is the supply sustainably. And companies to rare Right Our now, and on getting on restore believe United success to more earth mission DC won't for do the hold our breath. full that are we ours. relentless outlined. like stimulating so execution is we chain Washington States focused we But much I've for focused

forward, are operations optimization. our Stage our moving and Stage We improving I implementing II

world's fact, when lowest key In be to MP published rare a we [ph] research so check out. firm please cost is third-party II. the completes industry We treated their earth month, recently Stage that chart expected that producer last

this, our is earths case all main III. opportunity on working for parallel term are magnets rare for we use do for longer in of is that approach we enormous. Stage the Ultimately, the While size and

strong profitable So a balance we with are sheet.

and California. a only are modern scaled and We today. track of location precious commodity rare responsible producer company most electrification, facility on being earth de-carbonization industry we cost security. joining national Thank that are in we Western the environmentally supplier all is you in evidenced critical lowest by the to the are for our world's to We the believe and

Q&A operator now the Let's have begin the session.

first De Morgan Alba Instructions] from comes with [Operator Carlos Stanley. Our question

Your line open. is

afternoon, Good you. everyone. Thank

if questions I So may. couple of

sales, And half. you please -- expect than cost. volume see fourth first unit with up in tariff rebate, this of Thank ramp you if unit on that the any in will then special you half could getting also second the can do modest question. quarter, finalizing? quarters? be comment, And the foresee in stockpile is, as the much. lower very the the you from The Do will year Maybe -- rebate you will seasonality see more be cost first how of when throughout stable do basically growth terms first a if production are one the seasonality that the second you that the one, the in there so XXXX? comment be change you throughout you you do That

Sure. Hey, both Hey, take Carlos. you why don't those. Ryan,

Hey, Sure. Carlos.

terms significant So from be production I'd expect basis. your start a in seasonality. of I there to wouldn't on first seasonality one

half standpoint, tough I correct color shipment it's terms to From place think in volume I of give quarter really there. quarter back your probably is mentioned, great of growth year. view modest and that to any taking the lumpy in so be can as the the a

shipments I bit. of quarter year, we a think over selling our the to course be of course around XXX% but the of individual through intend each the production, the can certainly over move

stockpiles be left, XXXX a last On we predict some and duties may legacy question, amount prior item. the that to related XXXX certainty to import Chinese one-time XXXX. sales as sales, see until that a the I into those rebate small, on a stockpile The rebate up were in on and mean, couple in remaining the the with -- year but not tariff years. tariff and mentioned. are you coming March small of There This relate material tariffs in not of from piece reflected really was could and incredibly the a $XXX,XXX in first you'll quarter rebate anything place, our product,

to material I out inventory continue for think not we'll probably driver that a us. but sell over time,

Ryan. much, and Jim very you Thank Perfect.

add if SNR. royalty Just maybe expense I more on the could one to

and business from fourth -- the not what amount correctly in the the So, that done if on be in the saw and or the further of was combination was therefore it? combination first was the should the That results, -- any quarter $XXX,XXX I last we transaction were a from these tons $XXX,XXX, concluded payment seeing right, was sort in around release, we a and completed quarter. understood before I anymore read

the royalty just on SNR royalty sheet and business owned MP in right. SNR since payment mineral Corp, of see both combination, the not forward operations bringing Yes, no going from to the any balance reflects wholly -- mine going combined of Materials Carlos. or to company. forward. That's But interest company SNR expense company not will closing MP There subsidiaries the are the the in operating was you

you very Thank Excellent. right. much, guys. All

you. Thank

Thanks.

Next question?

Deckelbaum Your Cowen. next David comes of question with from the line

open. is line Your

for and Good today. Afternoon, time Ryan. the Thanks Jim

afternoon. course, Of

I was could you what per MP hoping you the research that the highlighted lowest fact once XXXX? kilo as to cost you in of you Could -- in that be to Mountain producer production and share points firm you're cost the the run NdPr basis world. the Pass party third expect your at rate targeted on

currently be and when you a I'll we're NdPr. that the quick say Ryan, do I model selling sell want complete and that's will II, comment NdPr. question Well, on make with research to we you that -- we're today Stage on front? is want actually But anything we a so don't obviously comment when was that that saying The Stage on product, we which remember produce to

we Yes, Sure. our with view highlighted, out as we behind right say provided the improvements think we for today, from design the way we XXXX. the the laid of I'd about stand think to it we guidance EBITDA that plan

the had divide implied total by that's structure per structure the high XXs if so that do in during just the provided of sort kilogram. produce on just math what transaction to public [ph] NdPr we go our And expect cost the you and we cost -- very

way about right the to that's think it. I think so And

rate in clarify once just in and up capacity that months run and talked from And per quarters? run you that ramp over that. would of to to you be running rate first up or long XXXX. terms is sort you the could How expect that of about getting achieved maybe then, appreciate full annum I X,XXX II to separation if Stage just do tons take of

way year Yes, we've ramp is completion, a we assume what normalized look haven't going best ramp, it XXXX to that XXXX. said is What said is view consists really the that like. that And the that anything will cetera. then that so et of about to specifically be

will than we love it So said as get obviously that will we can. but just about to as anything I'd really to other quickly ramp done try you help how we haven't do possibly

is, continue add product the that by concentrate thing David being consumed there II not other obviously we'll is ramp sell up One process. Stage I'd to our

so see generation Stage business, you II. as for this that the will Stage the obviously So standpoint results the year revenue we from cash a and ramp quarter expectation for continue our and I

from highlighted that. the last decision around just do Appreciate have business The in you opportunity, one a to sort you that you opportunity? terms or of you'll that is not capital me Chlor-Alkali a want of think facility pursue why whether

timetable on we So, don't have a that.

operating basis to before. thing important that design the the we think we're basically deliver XXXX I apples-to-apples is that where we obviously these relative to relative with on respect improvements the realize to an substantial progress we've model can improved made believe obviously and on staying

achievement. now we stated so kind to -- we Chlor-Alkali, but exciting any So ability preserve -- just announcing we're that a any we haven't about way say haven't be should that, is think our when we pretty public that capital think would made do ramp to to With that's the that haven't obviously opportunity. today, we other that separate up -- it of viewers this is high event it will and a we will analyze a on like return how than we you any that potentially investment

in get your guys. back queue. I Thank appreciate I time you. will the Absolutely.

Yes, of course.

question Chris of And the our comes next with Terry line Bank. Deutsche from

line open. Your is

at it time. I'll few I maybe Jim, Michael. do you. Thank you're questions. Hi, one had well. I hope just a Ryan,

and you was modified about? the the sounds reagents just that? how it reagents is savings itself way little the on and you just where separation as are the same bit doing the in Is reagents, or like there, it opportunity actual a one, that to talk save slightly an the have you wondering you come that's just that you exciting the First have the process do on could if you

Yes.

So, for giving chime you in a Chris, you're your thank -- chance -- here. we'll Michael to give

me So one. let that take Michael,

a good Chris. question. you, Thank It's

plan Mountain for our be new operations the areas and that the mentioned grows to generations previous that in we I Pass particularly of improvement there opportunities it some that think in China. are of assets assets of existing in presentations are practices, as deep And continued understanding to certain these we we operate as best the optimization previous industry of we re-commissioned that acquire. and with well how saw

in last earlier flow pilot to our we list. front-end decided more extend the before year, schedule finalizing spend engineering and time process on equipment to So R&D and work order

these in process design final of ultimately we in developed our of So some development incorporate equipment list. changes some confidence to that into

of So, -- usage. and leaching and NdPr removal to the recovery, are [ph] some work processes, roasting the improve we examples some and optimize conditions to minimize that the maximize roasting reagent of those leaching on

the made On side of amount leach minimize processes to remove to solids reagents of amount to the we [ph] minimize NdPr the minimize that adjustments the to leach itself, RO leach use water improved through used that of recycling. we and

we resiliency production well on-spec of finishing to and And we improve the enable handling including production process first And the yields. blend sort On improvements And excess greater stages our and improvement the made relative then of this blending the to of to improve to increase the storage the improvements products. finishing, of recycling production pass certain to also increased on reduce salable production side, flexibility as the to reduce various as to in capability products usage first maximize pass of and rates previous materials the NdPr model extraction reagent -- to processes production. non reagent to rates. includes use reagent made enhanced

the usage, to that we So leaching of [ph] have which of otherwise further all some which amount produced, reagent of side brine things the be to of neutralized our reduces reduces which spent these reagents then contributed amount consumed. is also reducing

of the high engage types very are those we then try confident this long-term So we savings. things very to that in us and and generate make return

in Michael. provide you extra or you timing are that those second the year half of specific of the of your II A wanted to the about startup update? middle thinking by just Appreciate position the think to give about couple maybe Or Thanks, how in a more early in do you'll some of color. you the ask, I be year, when XXXX? Stage point maybe

to totally We know what's the as obviously we'll best way. our let can be possibly they understand in later the get great themselves. business to year, can for We're question. going throughout have people going Hopefully, year people transparent, on. do see to of as this updated try some that kind So, people want so throughout to

look satisfying obviously can we that. we know not understand want specific we're and people measure a be may us recognize judge top as year do we to do hard aware. do other to that the that that what and us and want you best we we to something But as answer, team you tell a want are will we'll to And well. certainly say but throughout against keep mind to to I to as we the so as specific But our than execution you much to say it's as how it's so as investors progressing. we far give that -- timetable, of And focus,

then, stage moving Stage down to And Okay. just III. a

Just wondering through obviously that. still or look is look give sequence on opportunity on it, if you II can thinking if and an It's fit that update thinking get Stage can up just going an away are Stage it But you events about you exciting chip how how trying and in. running do Stage you you that. ultimately II then you might III at at and to while of about

we give I'm really have don't a is going any III unsatisfying Chris, which updates So to Stage you unfortunately, answer today.

You opportunistic. can be us to very expect

stated, And leave stage So will we obviously that. I working team on publicly we have III. a it at

a number and will have opportunistic. people we of we be So

we've just in recent me guess production NdPr relates of color in the moves Okay. the views price can since just the particularly on year, the to just Sorry, from the start one getting I you general, on last that market. China And seen from thanks. any NdPr? the updates the quarter, provide the

percent the how exact environmental or very I you missing see so There same in believe of the space I'm look two Maybe senior can of our that is is processing to officials would very But given the belief quarters the around referenced, the the EV that or talking they're next be you dollar term. to if headlines in to is of of prices multi-billion clearly also body, paraphrasing. seeing everyone an and if and can replacement the is that online. our be and have it the it's see chime amount you low fast just the there Chinese of headlines going what who say spaces, think knows. the belief math space, believe in -- also around I with demand is of of decades when price think prices near were the we time a and in growth this the just know what in to junior I this rarity interpretation mean, What might vehicles It full the as reflected the typically fundamentally -- few electric comes about given they the of kind to over that ore here other are who in upon out to a do I'm I on ground too we around there the around impact piece viable words ore to I And stated the look I were and or next earth, so there're and something a everyone certainly getting the economically going the is the the capital world of we some don't X% [indiscernible] right to X% like you these speak. we're see commodities month penetrated to remarks And you there think you X% forming true mining of investment. were other space, the then, some prepared is some XX% participant assets pretty this we're get be the that these of touch relative in plus cost would that do for projects a there we that demand. here can X% plus or appreciation that our as of body that. during tried the on driven. I've that knows incremental not this because other have obviously again maybe -- prices,

you And if so Western and of facility. a across look a in had capital sort again, build viable body world, to that, and today had you a then none but the have a it's ore exists you have a through just plan if permit of you separation and unlimited which really

and in and line we're given materials is time a more next years. by I But the going required, and do so, just throwing will given that think to bring challenging otherwise investment will expertise coming I be people than on two. end in think again is there. costs or the certainly out ability will month a we what to more being to And they up supply that that this playing something going is expensive out see we It the that seeing might number massive the of that on are nothing think sort prove be over find new

or house it. long-winded to way of if of our hopefully that's perspective don't a So, that's want I our Ryan view. Michael in, know chime but sort on you giving

That is helpful. you. Thank

guys. Thanks, it that's think from I All the best. me.

Chris. you, Thank

Ben more We set questions Baird. with from of will take one Kallo

open. is line Your

taking II reversed Ryan, get [ph]. Maybe Mark. just joking. I'm Thanks for Hey, James. Stage Hey, my when questions.

make to like some [indiscernible]. going was joke I

fluctuations figure that be mitigate and that margin Yes, really how help what because as you how reverse is helpful you about is customer you out maybe then talk but then maybe to think it downstream? and move would think think that the how the price means that, close I to that the fragmented could in and the downstream I

When right? the separate downstream, you II, to with say you're Stage referring it

III. stage No,

unsatisfying stuff. be you with maybe the again have but I III. at this don't that time, But can any you we Well, stage Oh, opportunistic. Yes. III press, to little us mortgage Stage expect a I'm say answer I'll same going give to updates extremely

leave that on helpful… Stage it III, I'll So be but might

in The market like? that -- it or that. what general, looks just in And like does

specifically we transformation a supply see. electrification it, you Yes, you're have the I total global this is to I what which Oh, had right, right. here's that here's you're to -- the think even of the is again OEM of remember economy, asking the market answer asking alone we've what not an chain, that never let if

the quote is CEO there is you the seen is the looks as we with there unlikely magnet are be the so on you've into downstream Volkswagen, about we what certainly in to alternatives. point going supply industry that But when that And reality of controlled certainly a like, China. in where chain think me today, going evolve the the of downstream viable in the continue failure single areas is to what's globally -- globally heard investment,

And positioned so we really we're believe well provide that to that.

or magnet little a our huge And mainly that be so our in a part that math and just opportunity is on is to will obviously the slides -- is penetrated as is belief this Japan. X% whenever of what that business is this maybe still and put today this in back ED such reality roughly the goes think but a concentrated if There of and so a to the today XX that scaling China. we will bit do it's for opportunity But solution. -- is part as the the that's of on just obviously huge and [ph], we've we that whole world about it's being think of is of when be XX%, core you that's plan obviously our part we again [ph] shaping evolves mission business magnet you

can industry And producers. you motor is today. The or a variety stands there involved far makers magnets, as be can involved, so say the definitely -- OEMs at the as would of the customers the is I be other magnet the thing

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two Thank you, you. Maybe That's for Ryan, first. and one questions very good.

them what comfortable making Do you're are that mine very employees structure. and are at with a ratio going the been value have leverage you and that then, you there. the benefits? do just in many stop the you few over Then there how long have make people it's are time sure working Just you, for a -- benefit. okay different to make think I but -- I'll successful? feel feel guys. the of speed And hands years? I them because are now, mean huge mines okay Thanks And James, that guys the for And that the

our that. mindful I of of cash. power of II are be no nauseam, history. I in of create I we of ourselves, to you we the very But mindful shortsighted. business And the made Stage lot the We certainly is that anything those We're appropriate remember years. want leverage, the though feel chime few me And last to strongly obviously as at in a not will significant is would we we year-end. Ryan, for And capital progress not have ad sort the Stage shareholders take sure large that On the needs uplift generating of very after. X probably are that be the the that balance believe and so looking and of culture be the the long-term owner-operator price, We both business we say probably structure the in value. to we leverage care to can sheet a are, heard business are there is then want obviously over on that we do make company that we our say that Sure, you've doubt business an can or speak. to

in on the needs great it's so business front, employee $X,XXX matter whatever, And the opportunity structure and as single a worker well the maintenance Everyone capital the the again to it's on appropriate and we whether or sorry, be receptionist, It matter or question a a as front. -- for your doesn't an as matter. -- might an non-employee is helps be non-executive mine you you're our owner. just it employee every actually aware, then hopefully bonus that I didn't be every that extension that's One non-executive title doesn't single employee leverage provided -- every the of got as shares well So, the for to your company every every what people of and -- employee our of job, gave granted that across. recently or again, transaction said, we XXX doesn't just matter not single part single November, public culture. owner-operator thing but as of which

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that I pays of is think need You them of shareholders sort And make mine and the dividends for like value them mentality. treat of versus of everybody goal There create that, that to or pointing kind to distinction because us they care. that fingers you really here. have no is sure

we've will been we everybody so in a that they'll to go and happy of continue get think hopefully and so, participate can And successful I it to we and upside. way that we is piece that success long far have right. And as as very think tell, much ahead we that

Good stuff. much. very Thank you

course. Of

This concludes this conference attending. for call. Thanks

now may You disconnect.

everyone. you, Thank