Core Points - Pacific Nickel Mines (PNM) subsidiary Pacific Nickel International (PNI) has agreed to sell 100% of its shares in the Kolosori nickel project to Green Rock under a share sale and purchase agreement (SPA) [1] - The Kolosori nickel project is located on Isabel Island and is a direct shipping ore nickel laterite project [1] - PNM holds an 80% stake in Pacific Nickel Mines Kolosori (PNMK), which is the owner and operator of the Kolosori nickel project [1] Financial and Legal Aspects - GRP & Associates has agreed to guarantee the buyer's obligations under the SPA [2] - A significant aspect of the transaction is the Glencore deed of release, which releases PNM from all liabilities under the Glencore secured facility agreement, currently guaranteeing $22 million (A$33.85 million) plus approximately $8.6 million in accrued interest [2][3] - The deed of release will become effective upon completion of the SPA and is a condition precedent to closing the transaction [3] Operational Context - PNM previously announced the cessation of operations at the Kolosori project due to operational challenges and a weak nickel price outlook in the short to medium term [5] - The PNM board concluded that entering into the SPA for the sale of the Kolosori nickel project is in the best interests of the company [5] Royalty Agreement - PNI has entered into a royalty agreement with Green Rock, entitling Pacific Nickel to a 1% royalty on nickel ore shipped from the Kolosori nickel project, contingent on monthly shipments exceeding 170,000 tonnes and the benchmark price on the Shanghai Metals Market averaging above $72 per tonne [4]

Core Insights - The company is focusing on operational efficiency following disappointing results in H1 2025, with a commitment to improve performance in the second half of the year [2][4][19] Financial Performance - Adjusted EBITDA (excluding SLN) for H1 2025 was €191 million, down 45% compared to H1 2024, primarily due to reduced contributions from PT WBN and unfavorable product mix [4][19] - Net Income, Group share (excluding SLN) was negative at -€101 million, a decline of €132 million year-on-year [4][19] - Adjusted Free Cash Flow was -€266 million, with liquidity remaining high at €1.7 billion [4][24] Operational Highlights - Safety performance remained strong with a Group TRIFR of 0.6, significantly better than the CSR roadmap target of <1.0 [5] - Manganese ore transported volumes are revised to between 6.5 and 7.0 million tonnes for 2025, with FOB cash costs adjusted to between $2.1 and $2.3/dmtu [4][47] - Nickel ore sales are projected between 36 and 39 million wet metric tonnes for 2025, reflecting revised licensing [4][64] Market Trends - Global carbon steel production declined by nearly 2% in H1 2025, with China experiencing a 3% drop due to reduced domestic demand [33][34] - The price index for manganese ore averaged $4.6/dmtu in H1 2025, down 14% year-on-year, influenced by increased supply from South Africa and Australia [38][39] - Global demand for lithium increased by 29% in H1 2025, driven by electric vehicle sales, while lithium supply also rose, leading to a surplus in the market [81][82] Strategic Initiatives - The company launched an in-depth operational review in June 2025 to enhance performance [4] - A controlled capex plan for 2025 is reiterated at between €400 million and €450 million, focusing on sustaining and strengthening rail transportation capacity [4][97] - The company is actively pursuing health prevention efforts as part of its "Act for Positive Mining" roadmap [8]