Almonty Industries Conference Call Summary Company Overview - **Company Name**: Almonty Industries - **Ticker**: NasdaqCM:ALM - **Market Capitalization**: $1.5 billion - **Share Price**: $7 - **Headquarters**: Currently in Toronto, planning to move to the United States by the end of the year [5][6] Industry Context - **Industry**: Tungsten mining - **Key Operations**: - Sangdong operation in South Korea (largest tungsten project since the 1970s) - Panasqueira mine in Portugal (oldest tungsten mine still in operation) - Additional projects in Spain (Los Santos and Valtreixal) [6][7][10] Core Insights and Arguments - **Tungsten Demand**: - Tungsten is essential in various applications, including defense, technology, and automotive sectors [7][8][17] - 83% of the tungsten market is controlled by China, with significant implications for supply chains in the U.S. and Europe [8][10] - **Geopolitical Risks**: - China has imposed export restrictions on tungsten, impacting U.S. military applications from 2027 [9][10] - Almonty is positioned as a key supplier to mitigate supply chain risks for the U.S. and EU [10][11] - **Production Plans**: - Phase 1 of the Sangdong mine is expected to produce 640,000 tons of tungsten ore, generating 230,000 MTU [11][22] - Plans to double production to 1.2 million tons by adding another 560,000 tons of ore in the following year [22][15] - **Financial Stability**: - Almonty has secured a 15-year off-take agreement with a floor price, ensuring revenue stability [11][40] - Recent funding of $90 million raised for a tungsten oxide facility to enhance revenue generation [12][27] - **Market Positioning**: - Almonty aims to be the only U.S.-based tungsten producer by 2026, enhancing its market presence [14][36] - The company has established strategic partnerships, including with American Defense International, to strengthen its position in the defense sector [21][31] Additional Important Points - **Technological Advancements**: - Almonty has developed new technologies in Portugal that have been crucial for operations in South Korea [6][28] - **Economic Outlook**: - Tungsten prices have recently increased to over $600 per MTU, with expectations of a long-term price stabilization between $500 and $600 [18][19] - The company maintains conservative economic models at $350 to $400 per MTU to ensure operational viability [32] - **Molybdenum Asset**: - Almonty is exploring options for potentially spinning off its molybdenum asset, which has a strong off-take agreement with SEAH, a government-backed steel producer [34][29] - **Future Growth**: - The company is focused on expanding its production capabilities and enhancing its market share in the tungsten sector, with a projected mine life of 45 years [26][12] This summary encapsulates the key points discussed during the Almonty Industries conference call, highlighting the company's strategic positioning within the tungsten industry, its operational plans, and the broader market dynamics affecting its business.

Top Risks for Global Businesses - Geopolitical volatility has cracked the top 10 risks for global businesses for the first time [1] - Regulatory and legislative changes are a significant risk, exemplified by government instabilities like potential shutdowns in the US and reshuffles in the UK [1][2][3] - Government instabilities can drive other issues, including supply chain disruptions and commodity pricing fluctuations [3] - Companies need to respond quickly to increasing risks, as there is little time to recover [4] Risk Exposure and Preparedness - Only 14% of companies track their exposure to these risks [5] - Companies are not adequately looking at their second and third-tier suppliers, creating blind spots in supply chain risk management [7][8] Cyber Security and Data Breaches - Cyber attacks or data breaches are the number one risk for global businesses [8] - Cyber attacks cut across every aspect of the economy, affecting various industries [10] - Financial services and any entity relying on a network are especially at risk due to their dependence on complex global communication [12] - Companies are not spending enough time understanding second and third-degree cyber risks [11]

Financial Data and Key Metrics Changes - Fiscal Year 2025 marked a transformative year for the company, moving from development to commercial readiness, with a robust after-tax NPV of $725 million and a 19% project IRR confirmed by the pre-feasibility study [2][3] - The after-tax NPV is approximately $469 million with a 16% project IRR, and free cash flow over the life of the mine is estimated at roughly $3.7 billion pre-tax [4] Business Line Data and Key Metrics Changes - The company successfully qualified its high-purity boric acid with 14 customers across various industries, indicating strong demand for U.S.-based boron supply [5][6] - Phase one targets 130,000 short tons per year of boric acid, with all-in sustaining costs estimated at $555 per ton and initial capital at about $435 million [4] Market Data and Key Metrics Changes - The company noted a significant supply chain risk in the boron market, particularly due to disruptions from major producers, which has created a clear opportunity for new market entrants [10][11] - The second largest boric acid producer in the U.S. has seen costs increase approximately 60% since 2017, highlighting the need for new production sources [10] Company Strategy and Development Direction - The company is focused on advancing towards a final investment decision (FID) by mid-2026, with early FEED engineering activities already commenced [8][9] - The company aims to build a strong and resilient boric supply chain to support the U.S. industrial base for generations [20] Management's Comments on Operating Environment and Future Outlook - Management emphasized the fundamental need for a new market producer in the boron sector, especially in light of supply shortfalls expected to begin in 2026 [11] - The company is optimistic about progressing full-scale testing with multiple specialty glass manufacturers and securing additional qualifications and initial offtake agreements [11] Other Important Information - The company received a non-binding LOI from USXM for a potential $285 million project debt facility, which is a significant step towards funding phase one construction [3] - The company has submitted a formal response to the U.S. Geological Survey draft critical minerals list, advocating for boron to be included [9] Q&A Session Summary Question: Can you review the comments you had about the disruption to the California boron mine? - Management explained that Rio Tinto has streamlined its business structure, placing its industrial minerals segment under strategic review, which includes borates [15] Question: To get boron on the U.S. Geological Survey critical minerals list, what needs to happen in terms of the review? - Management indicated that public comments are essential for the review process, and they submitted their comments along with other groups during the 30-day public comment window [16][17]