TMC the metal company (TMC)2024-05-14 09:37Financial Data and Key Metrics Changes - In Q1 2024, the company reported a net loss of 0.08 per share, compared to a net loss of 0.05 per share in Q1 2023 [25] - Exploration and evaluation expenses increased to 7.2 million in Q1 2023, while general and administrative expenses rose slightly to 6.2 million [25][26] - Free cash flow for Q1 2024 was negative 23.5 million in Q1 2023 [27] Business Line Data and Key Metrics Changes - The company has successfully pivoted to a capital-light model, reducing pre-production capital expenditure requirements [14] - Nickel prices have stabilized and increased by 18% in Q2 2024, which is beneficial for the company's operations [6] - Cobalt and copper prices have also seen significant increases, with copper prices up by 17% and manganese prices up by nearly 30% in Q2 2024 [15] Market Data and Key Metrics Changes - The company highlighted the growing interest in deep seafloor nodules for critical mineral supply chains, particularly in the context of U.S. defense and energy needs [8][17] - The company is positioned to provide alternatives to nickel sources controlled by China and Russia, which is increasingly relevant in the current geopolitical climate [6][8] Company Strategy and Development Direction - The company aims to launch its application for an exploitation contract following the July ISA meeting, focusing on the NORI-D area [53] - The strategy includes securing strategic partnerships and leveraging existing processing infrastructure in regions like Indonesia and Japan [76][89] - The company is committed to addressing environmental concerns through comprehensive data collection and impact assessments [49][58] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence that emerging data will counteract activist-driven speculation regarding environmental impacts [58] - The company is optimistic about the regulatory progress and the potential for the U.S. to enhance its position in the deep-sea mining industry [47][88] - The management noted that the demand for metals derived from polymetallic nodules is expected to grow, particularly in the context of electric vehicle production [44][82] Other Important Information - The company has accumulated the most comprehensive deep-sea dataset ever collected in the Clarion Clipperton Zone, which is being shared with public databases [19] - The company has sufficient liquidity, with 49 million in total liquidity as of March 31, 2024, to meet its working capital and capital expenditure requirements for at least the next 12 months [9][57] Q&A Session Summary Question: What is the timeline for the Chinese entities expected to conduct tests next year versus your timeline? - Management indicated that Chinese contractors expect to be in production by the early 2030s, while the company plans to lodge its application after the July ISA meeting in 2024 [62][80] Question: How does the company view the U.S. Senate's ratification of the UN Convention? - Management stated that if the U.S. does not ratify the UN Convention, it underscores the necessity for the U.S. to partner with contractors like the company to access deep-sea resources [87] Question: What is the company's liquidity status and application demands? - The company confirmed it has sufficient liquidity for the next 12 months, with an incremental 35 million to $45 million needed to launch the application following the July 2024 session [67][68] Question: Can you provide updates on strategic partnerships? - Management highlighted ongoing efforts in Asia, particularly in Indonesia, to leverage existing processing infrastructure for nodules, and emphasized the importance of strategic partnerships in achieving production goals [88][89]