Good morning and welcome to the Central Asia Metals 2024 results presentation. Before we start, I think Central Asia Metals would just like to offer our condolences to all of those affected by the recent tragedy in North Macedonia. Our thoughts are with everyone in that country and in particular any of our staff members that have been affected directly by this tragedy. Thank you. Moving on to the 2024 overview of our performance. Very encouraging performance during the year, with revenue at $214.4 million, driving an EBITDA figure of $101.8 million at a margin of 47%. We generated free cash flow of $65.7 million through the year, and that allowed the board to announce a GBP 0.09 dividend for the final 2024 dividend, bringing the full year dividend to GBP 0.18, which represents 63% of that free cash flow number. That performance was achieved in a very safe manner.
We unfortunately had two lost time injuries through the year. Fortunately, these were minor injuries, but our lost time injury frequency rate is 0.77, which is below our target, which is a good thing. Production at Kounrad was solid, right in the middle of guidance at 13,439 tonnes. You can see some very healthy EBITDA and EBITDA margin figures for that asset itself. At SASA, we were fractionally short of guidance, slightly disappointing, but in the context of all of the transitional projects we were undertaking, still a reasonable result for SASA at 26,617 tonnes of lead and 18,572 tonnes of zinc. Let me give you a little overview of our operations, just to remind everyone where we are. SASA and Kounrad are really the engine room of the business right now.
SASA is a lead-zinc mine in North Macedonia, an underground mine, been in production for a long time, since the 1960s, and we acquired it towards the end of 2017. We have a life of mine there out to 2039, and our guidance for the 2025 period is 19,000-21,000 tonnes of zinc and 27,000-29,000 tonnes of lead. Kounrad, 100% owned in Kazakhstan. This is an in-situ dump leach SX-EW copper producing copper cathode, and it's been in production since 2012. We're guiding 13,000-14,000 tonnes of copper there. We have some long-term development opportunities in Aberdeen Minerals, which is an investment in an associate company. We own 28.4% of that company, and that's exploring for copper-nickel mineralisation in Scotland. Camel X, which is a joint venture we set up, we own 80% of that.
20% is owned by the management and the exploration team there, and that is out in Kazakhstan exploring for greenfields opportunities. Moving on to the Kounrad operation, we're in our 13th year of production at Kounrad now, and it remains a unique asset. We produce copper through irrigating the dumps with what we call a raffinate. That leaches copper into a solution which we pump to our plant, which is on the right-hand side of that diagram you can see there. We have two areas we leach: the eastern dumps and the western dumps. We commenced at the eastern dumps back in 2012. We're down to around 27% of production coming out of those eastern dumps for 2024, with a balance coming from the western dumps, which will dominate for the remaining life of the project.
If we go to the copper production stats for Kounrad, you can see in the histogram down on the bottom left-hand side there that production has been fairly stable for the last few years, and we've got at least 85,000 tonnes of recoverable copper remaining. Why I say at least, if we look at the leach curve on the right-hand side, you can see the solid line there indicates an outperformance versus the theoretical leach curve there. We are looking at options for Kounrad's future. Just given that outperformance going forward, we're looking to continue with that, and that is very encouraging news. SASA is a much more traditional operation. That's an underground mine using mainly cut and fill and long-hole stoping, along with some sublevel caving, which is the sort of legacy mining method there.
We produce a flotation concentrate through standard froth flotation, which is then trucked to smelters mostly located within the EU. There are some working capital benefits to that. You can see in the foreground some of the new facilities we've been constructing over the last few years. I'll give you more detail on those, but it's all of this modernisation of the SASA mine over the last period of the last five years and the period that we've owned it has extended that mine life out to 2039. The production at SASA, as I said before, we were fractionally below guidance, and you can see in the histogram there the tonnage is tailing off in 2024, and that's reflected in the table on the right-hand side of the page where we've gone from a sort of run rate of over 800,000 down to 762,000 for the year.
That's largely because of the challenges posed by the transition to paste fill mining through the year. We commissioned that paste backfill plant in the diagram at the top of the—actually, that's not the paste backfill plant, that's the dry stack tailings plant, unhopefully. The paste backfill plant was commissioned in Q1, and what we found there was filling some of the voids that we'd identified took a bit longer than we expected, made us rejig our mine plans, with the ultimate consequence of lower tonnes coming out of the mine. At the same time, we were also investing quite heavily in training and putting two new mining methods in place and associated with the reticulation and placement of cemented paste back underground.
There was a bit of a learning curve to go up as well, and the guys have responded really well to that, and we're now happy to report that we are mining using those two new methods successfully and placing paste into stopes as well as into voids. We're mining on top of those stopes as well there now. We're looking to get that run rate annualized back up to 800,000 tonnes and above as we move ahead with SASA. I mentioned those three elements of the transition projects. Going from left to right, paste backfill plant, as I said, that's been in consistent operation through 2024 since it was commissioned. We've placed around 240,000 tonnes of tailings back underground using that method, and that's pretty much going very well at the moment.
Dry stack tailings, we have just completed construction of that plant, and it is in commissioning right now. We are on track to be putting dry stack filter cake on the surface in Q1 2025. The central decline was completed back in December. It is in full production now. We have already seen improvement in cycle times and an increase in the proportion of ore being hauled up the decline versus the Galima Reka shift. We are also testing larger trucks that were designed to take up to a 50-tonne truck, currently testing a 30-tonne truck to supplement our 20-tonne fleet at the moment, and that is further improving haulage efficiencies using that central decline already. Onto the sustainability. It has always been a key focus for Central Asia Metals. We tend to measure ourselves by a KPI set against our five core pillars of the sustainability strategy.
Those are the ones listed down on the left. In that green box on the right-hand side, we can see what we achieved through 2024. Now, there's a couple of key achievements there, which one is we're down to a 44% reduction in our scope one and two greenhouse gas emissions. That's against the target we've set ourselves of 50% by 2030 or for 2020 base. We are publishing our fifth annual sustainability report, which as a junior mining company, I think is a great achievement. We've done a few other things within there as well. The one thing we'll talk about in a bit more detail is GISTM when we go into the SASA slide. Sustainability at Kounrad, just a quick counter through these. Very proud of the fact that we are 100% local Kazakhs operating that asset for us.
The solar power plant that we put in place there is generating around 14% of our power requirements. It is much higher in the summer. December is probably its worst operating month, so the 14% is an average. We are starting to see some real cost benefits from that, as well as the reduction in greenhouse gases that we have achieved through putting that in place. We have the Kounrad Foundation into which we put 0.5% of revenue there. We have spent around $3.2 million on local projects. Most of these are long-term projects. We are financing things like the youth centers in Balkhash. We have a couple of areas where socially and socioeconomically deprived people can benefit from some centers we have put in place in there as well. Plus, also very important elements of education, such as STEAM, and supporting the local medical facilities as well.
In the shorter term, we've actually contributed towards the restoration of some apartments in the Kounrad village adjacent to the project, which were unfortunately destroyed during a fire last year. Two pillars to that investment there. One is the short-term stuff that the community needs, and we remain supportive of our communities and also looking to put in long-term sort of capacity building projects as well. Similar at SASA in terms of the foundation, slightly different approach there where we've actually launched what we call an acceleration program where we'll be financing new business ideas and entrepreneurial ideas that the local community comes up with. We've owned the mine for about half the time as we've had Kounrad, so slightly less spent there, but a good respectable $2.3 million spent there as well.
I mentioned earlier, the big achievement in terms of sustainability at SASA through 2024 was achieving conformance with GISTM, the Global Industry Standard for Tailings Management. That has been audited by a third party. In a voluntary initiative, it has taken us three years to get there. Again, a great result achieved by the team at SASA for that. I'll now hand over to Louise, our CFO, who's going to run you through the financial results.
Thanks, Gavin. Yeah, just to start with the market conditions to set the scene for the results that we've announced this morning for 2024. In terms of commodity markets, generally, we had pretty strong commodity prices in 2024 and generally higher commodity prices than they were in 2023. We had a 9% increase on the copper price year on year and an 8% increase in the zinc price and a 3% decrease in the lead price. In terms of inflation impacts, inflation was slightly easier in 2024 than it was in 2023. Actually, in 2023, it was almost 10% inflation in Kazakhstan and over 9% inflation in North Macedonia as well. Inflation making life a little bit easier for us in 2024. A few factors related to foreign exchange.
We've seen in 2024 a weakening of the US dollar relative to sterling, and that has a couple of impacts on us. It increases effectively the dollar-denominated group admin costs as we pay our admin in sterling in the U.K. It also increases the value of cash outflows to pay our dividends, which we pay in GBP as well, effectively. We've seen a weakening of the Kazakh tenge and the North Macedonian denar against the dollar. That has a positive impact on dollar-denominated operating costs. Also, in particular, the Kazakh tenge, the weakening of that currency versus the dollar, that's had a significant foreign exchange gain coming through the income statement, and that's actually a swing year on year of $9 million coming through the P&L.
If we move on to the income statement and just to set the scene on the income statement a little, in the last few months, we've been in communication with the Financial Reporting Council, the FRC, and they've made a couple of key suggested changes to how we present our accounts. We've incorporated those into 2024 results, and also we've restated those for 2023 so that we're comparing like with like. One of these suggestions was related to revenue, the other related to share-based payments. On revenue, what we used to do was net up from our revenue the cost of buying silver on the open market to fulfill our SASA silver streaming arrangements that are in place with Trafigura. The FRC suggested that actually the more appropriate accounting treatment for that is to have those purchases as a cost of sale.
The impact of that increases our revenue, our net revenue effectively, and it also increases our cost of sales by the same amount. Our profitability is unchanged, but higher revenue, higher cost of sales. The second aspect that the FRC suggested is a change to how we account for our share-based payments. We have in the last few years, typically, not all the time, but typically been cash settling more of these employee options than equity settling them. That is because we have had excess cash, we have got no debt, and we did not want to introduce unnecessary dilution. Because of this past practice that we have effectively established, the FRC recommends that we should change the accounting treatment of those employee options to treat them as effectively cash settled liability as opposed to equity settled item within the equity part of the balance sheet.
They move out of the equity part of the balance sheet and into a liability. The fair value gain or loss on those annually goes through the P&L in a new line that you can see there, FV movement of share-based payments. The old equity settled share-based payments were in admin, and they now come out of admin. We have put a slide in the appendix, which hopefully helps analysts and investors to understand this, which explains what we did report for 2023 and the 2023 restated numbers. Our IR manager, Richard here, has offered to run through these changes with anybody who wants more clarity and more detail on those. If we now run through the income statement comparing like with like, we are reporting revenue of $214 million, and that is a 5% increase year on year.
That's driven by an increase of about $8.5 million in Kounrad's revenue and about $2.6 million in SASA's revenue. In terms of cost of sales, these were up by 8% year on year. That's about a $7.7 million increase. There are two key components leading to that increase. One is we've had in 2024 a full year of operating the paste backfill plant at SASA. That was about $2 million. Also now, with the new way that we're accounting, we've got almost $2 million higher silver purchases within cost of sales, and that's related to a higher silver price in 2024 versus 2023. Obviously, you see that higher silver price within the revenue line as well. Group admin costs, they were up 8% year on year. There are two key reasons for that, which account for almost the entire increase.
That's almost a $1 million increase on business development costs that we on projects we appraised and looked at in detail last year. Also, an additional $1 million new costs on general exploration costs for Camel exploration. All that meant that we've reported an EBITDA of just under $102 million at a margin of 47%, which is pretty much consistent year on year. We've reported EPS from continued operations of 28.9%. That's a 42% increase year on year. A lot of that is related to that $9 million swing in foreign exchange and also lower tax payments. We move on to look at Kounrad's C1 copper cash costs. We're reporting a cash cost for Kounrad of $0.80 per pound, and that's a $0.06 per pound increase year on year or 8%.
Interestingly, about a third of that increase is effectively due to a lower tonnage that we produced from Kounrad that year, so of 377 tonnes. In terms of the key aspects of the increase, two main areas of about $0.02 per pound, we had an increase in consumption of two of the key reagents that we use in our SX-EW facilities. Also, we had an increase in payroll and consultancy costs of about $0.03 per pound. That is really related to agreed pay rises of 10%, which we gave to the workforce last year, supporting them through the inflationary pressures in Kazakhstan. All in all, a good result as the C1 cash cost base at Kounrad increased by only $1.1 million, and that is 5% in US dollar terms, leading us to report a very profitable 73% EBITDA margin for the Kounrad operation for 2024.
If we look now at SASA's run of mine costs, we're reporting a run of mine costs on a per ton basis of $64.6 a tonne. That's an $8.4 a tonne increase year on year, but 58% of that is due to the fact that we reduced the number of tonnes that we mined by 5% year on year for the reasons that Gavin explained. Some of the additional costs that we've looked at, again, it's that SASA paste backfill plant, which is incorporated within the processing cost line. Actually, processing costs would have been completely flat had it not been for the increase of that paste backfill plant as well. On a very positive note, the C1 cost benefited from reduced realization costs, and that's about $3.5 million, of which $2.9 million is related to treatment charges and the rest related to lower freight costs.
When we look at the SASA C1 costs in total, actually, we had only a $0.5 million increase in SASA's C1 cost base for the year. That led us to report a very respectable EBITDA margin for SASA of 35%. If we look at our CapEx now, we spent just under $21 million on CapEx, of which $6.4 million was related to the capital projects that we've talked about at SASA. That's a significant reduction on the $14 million that we spent in 2023 as we're now starting to bring this project to conclusion. During the year, we ran the paste backfill plant for a full year. That was completed at the end of 2023. We completed the central decline at the end of 2024. That's now down to the 750 level, which is the lowest level that we're currently developing that to.
We also made really good progress on dry stack tailings plants and landform as well and spent $3.1 million on that. Sustaining CapEx, we spent $14.4 million on that. At SASA, we had a similar level of underground development, and we had some increased costs on mobile plants and underground mining equipment at SASA. Kounrad, very typical level of sustaining CapEx there of $2.5 million, and also a little bit on Camel exploration, Camel X of $0.3 million there. We have given guidance for 2025 of $18-21 million of CapEx for this current year. Moving on to our balance sheet, we have still got a very strong, very flexible balance sheet. We ended 2024 with cash in the bank of $67.6 million and with pretty much no debt. There is, I think, just less than $300,000 of an overdraft facility drawn in North Macedonia.
Importantly, we've got facilities available of around about $10 million there as well. Other things to point out on the balance sheet, we've got the investment in associates and also a component in other assets, which relates to our Aberdeen position of $28.4 million. We have those warrants, which have been valued by the Black and Scholes method for $0.4 million within other assets as well. Finally, to point out the new item on the balance sheet, which is in the row saying SBP liability, that's these new cash settled share-based payments liability of $10.9 million. Just to bear in mind that they have come out of where they were on the equity line. Moving on to my final slide, and that's on the free cash flow and the cash flow.
If we look at the waterfall chart, we generated $94 million from our operations last year. We paid $41 million of dividends. That is the final dividend for 2023 and the interim dividend for 2024. Within the income tax, we had a significant reduction on that versus 2023, where our cash tax paid was about $27 million. That was a positive for our cash flow for 2024. CapEx, we have just discussed, that was just under $21 million. Our investment in Aberdeen of $3.9 million is $3.18 million plus some costs associated with that. That led us to end the year with a strong cash balance of $67.6 million. You can use that chart and the little table to calculate the free cash flow, which is important for how we work out the dividends that we return to our shareholders.
We have delivered free cash flow of $65.7 million for 2024. I will now hand back to Gavin to run through capital allocation and our outlook.
Thanks, Louise. We will look at our growth strategy. Clearly, we have been quite transparent about looking to grow the business using that flexible balance sheet that Louise mentioned there. I just want to run you quickly through what we did last year and what sort of thing we are looking at. It was a very active year in terms of business development with 37 opportunities reviewed, 13 NDAs signed, and six site visits undertaken. That is about all we can divulge, but those site visits are when we are getting really serious about things and looking to make offers on assets. It was just unfortunate that in certain instances we just did not manage to convert on these things.
We are and remain very active in the search for a new asset. What sort of thing are we looking for? As I said earlier, we have that engine room of SASA and Kounrad that gives us the flexibility and sort of comfort to do this. We have the earlier stage long-term things, which I will talk through in a minute. What we are really trying to do is add a kind of third leg to that strategic stool, if you like, of getting a near-term cash flowing asset in place and building a pipeline and a portfolio of assets that we can then bring to book off the back of our underlying cash flows. We have been looking at early stage exploration. I will talk about that in terms of Camel X in a bit.
Things that are in production are clearly of interest to us, particularly at the right price, but those are few and far between. What we call the overlooked opportunities, these things may be developed assets where the exploration has been done. There is no discovery risk, but they are languishing in a company or within a portfolio where there is either a lack of funds to develop them or they are strategically unimportant to the current owners. We do spend a lot of time using our network within our business and also within our board. We also get presented with opportunities by the investment banking community from time to time as well. Where are we looking? Focusing on this European time zone, that does include some selected countries in Africa.
Kazakhstan is still a core to our business, so it's clearly important from a growth perspective as well. We want to align our commodity exposure with our strategic view that we're going to produce base metals that are essential for modern living. As I said earlier, we've got that borrowing capacity under that balance sheet. It does give us an advantage over a lot of our peers in that we can pay cash for things, but we're also importantly not going to be diluting our shareholders unnecessarily. That ability to leverage does actually enhance the accretion that we look at when we assess these things. Clearly, they've got to be accretive to our shareholders, and there's an enhancement through that borrowing capacity as well.
In terms of our sustainability strategy, I think that is an important aspect of our M&A sort of due diligence and making sure that we do not dilute our principles as far as that goes as well. Let's talk about what we did do in 2024. As Louise said, we invested $3.8 million into Aberdeen Minerals. We now own just over 28% of that business. The cash that we put in helped finance a drilling campaign, which was carried out late summer last year. We drilled seven holes, or at least Aberdeen drilled seven holes. They are quite deep holes, so they are expensive. They take some time to complete. Assays have been dispatched, and we have got the results now, which have validated the exploration model. That is super encouraging. We have seen visible massive net- textured sulfides in the ore.
What we're doing now is using that information to target the next round of drilling, which will commence in quarter two this year, to look for the higher-grade portions of the soil body that has been discovered. Moving on to Kazakhstan. As I said earlier, super experienced and motivated team there. They own 20% of this business, so we believe they're incentivized properly in order to go and find things. 2024 was really a reconnaissance year for us. We secured two licenses within 2024. We've secured another two in the first quarter of this year. We now have four licenses that will be the subject of the summer 2025 campaign. That involves a lot of surface geological mapping, but also, importantly, geochemical sampling and also some geophysical surveys such as magnetic surveys planned for a couple of those areas as well.
That's all going to commence in the next few days. Basis the results of that, this is early stage. The ultimate goal here is to get some drill targets set up. Whether that'll be 2026, don't know. I think if we're lucky, it will be, but it is a longer-term strategy here, so we're probably looking further out. Very excited about what the guys are looking at there. Moving on to our returns to shareholders, which, as we've both said so far, we've got that full-year dividend in highlights there of 18p. That actually brings the total dividends that Central Asia Metals has returned to shareholders since IPO to around $380 million, which is an extraordinary achievement by a small mining company, I think. The dividend policy, to remind you, is 30-50% of free cash flow.
We've elected to pay outside of that policy just in the absence of a large transaction. We do have the cash, and we think the right thing to do with that cash is to return it to our shareholders in the absence of a transformational or material transaction. Little dividend timetable there, I'm sure all of you that hold the shares are very aware of on that front. In terms of summary and outlook, the guidance that we've given you is unchanged from the previous year. We've got to keep the pedal down there. Particularly, as I said, at SASA, the challenge is for the guys to get back up to that sort of 800,000-ton-a-year throughput level, which we currently seem to be on track with. We've got that dry stack tailings plant I mentioned earlier, which is being completed and is currently under commissioning.
That operational commenced imminently. In terms of our capital allocation priorities, as Louise says, the CapEx has reduced, as you've seen, from 2023 to 2024. It allows us to continue that discipline search for the material growth whilst growing the cash balance and advancing our long-term sort of growth through those explorations as well. That final dividend, we're going to pay that 9p gets paid on the 20th of May, 2025. Background to all of this is that flexible balance sheet. We're debt-free. We've got a lot of cash, just under $68 million, with strong cash flows that allow us to access the debt capital markets. We have been able to self-finance all of those internal projects. That ability to borrow basically means less dilution for our shareholders going forward. Very encouraging picture. I'll wrap up there and invite questions from all of the attendants.
Thank you very much, sir. Ladies and gentlemen, if you'd like to ask an audio question, please press star one on your telephone keypad. Please also ensure your mute function is not activated in order to let your signal reach your equivalents. Our very first question today will be coming from Alexander Pearce calling from Bank of America Merrill Lynch. Please go ahead.
Morning, Lou. Maybe I can just ask a question on capital allocation. You flagged already your balance sheet is in good health, and you've paid out dividends well above your policy, your free cash flow linked policy again this year.
Now, you touched on this, Gavin, a little bit, but should we assume you're happy continuing to pay out that kind of GBP 0.18 minimum going forward then, assuming there aren't any acquisitions or large acquisitions, or can you see a situation actually where you could put more cash on the balance sheet ahead of any potential transactions?
Yeah, thanks, Alex. I think we're in the comfortable position here that in the absence of a material transaction that would require us to rejig the capital allocation a little bit, we will continue to pay outsized dividends, if you like. The policy is 30%-50%. I think our initial target, if we did do a material transaction, would be to return to policy. That would be the goal there.
Given the CapEx is diminishing, and even at these sort of rates, we do expect to grow that cash balance, which will make M&A a lot easier.
Great. Thank you.
Thanks very much. Our next question will be coming from Peter Mallin- Jones of Peel Hunt, please go ahead.
Good morning, all. I have two questions, if I might. The first one sort of follows on from Alex's capital allocation. I was just wondering, given cash is building, you're already paying, obviously, very generously over policy. I was wondering whether management or the board were considering either topping up that dividend or altering the mix between the dividend and, say, a buyback, just given where the shares are languishing, whether a buyback may support your equity price, which perhaps might open up other options for M&A.
You had a second question, Peter.
Do you want to answer this one quickly first?
The second one was simply, I have a vague recollection that you were hoping to do some drilling off the central decline now that that's up and running. I was wondering whether that's an event we can expect through this year to start sort of testing some of the deeper sections at SASA.
Sure. Okay. The first question first, I think, look, just to echo what I said to Alex, I think we've got that sort of relatively comfortable position where we are growing the cash balance against the background of reducing CapEx and keeping that dividend flat in the absence of a material transaction. I think that is compensating shareholders for our sort of lack of success, I suppose we want to call it, on the M&A front. As I said, it's not through lack of trying.
We did a lot of work on that last year. We've got a reasonable pipeline building this year on the inorganic growth front. Buybacks actually link into that because it makes it quite difficult for us to manage the share price. I mean, I don't want to say manage the share price. If we're buying back shares and then we need to issue the shares again in order to effect a transaction, we think that confuses the capital allocation story a little bit. We're trying to keep it as simple as possible just by keeping that dividend at that kind of level that it is right now rather than looking at other things. It is something we discussed as a board, and we had a recent discussion on it as well.
I think, but ultimately, we always land, given that the aspiration here is to grow the business, that a buyback is probably not the most appropriate capital allocation option for us right now. In terms of drilling, you're quite right. Your recollection is correct. We actually drilled over 7,000 meters in terms of exploration drilling during 2024. Some of that was kind of more in terms of increasing the confidence of the ore body that we already knew and providing some additional information on grade. We did drill around just under 3,000 meters down to the 750 level. In addition to that, another 1,500 meters from that central decline, testing that middle ore body. I think the long section, you remember there's that blob in the middle called Kozja Rekha. We were sort of testing the mineralization there from that middle ore body.
It's, I think, more exciting from the perspective of 2025. I think we're at about 10,000 meters of exploration drilling planned there, mainly to test the northern extent of the Svinja Rekha ore body and the Svinja Rekha ore body at depth. That is also driven somewhat by a structural geological study that we had done on the mine back in April. That has generated a couple of drill targets for us at SASA as well. Those eagle-eyed amongst you will actually see that a lot of that drilling I've spoken about now has been quite successful in terms of replacing the depletion that we suffered through mining. The reserve tonnage remained more or less the same 2023 to end of 2024. The drill rig is working well for us at SASA.
Thank you. That's all for me.
Thank you very much, sir.
We'll now move to William Dalby of Berenberg. Please go ahead. Your line is open.
Yeah. Good morning. Thanks a lot for the call and congrats on a very solid set of results. Yeah, just a couple of questions from me. First is on treatment charges. Yeah, I know in the release, you say that zinc and lead TCs have been negotiated for the year, April to April for 2025 at historically low levels. Just wondering whether you can share a bit more on what sort of numbers we're talking about there. That's the first question. Then really the second is around BD, and you sort of guide every year to dozens of opportunities considered, and then going down to a few NDAs and site visits, and ultimately hasn't come to an acquisition yet.
Just hoping you can maybe give a little bit more context around what is kind of stopping getting those over the line, so to speak. Is it competition, not wanting to overpay? Is it just sort of niggling things, meaning they fall at the final hurdle? I think it'd just be helpful to get a bit more co
lor there. Thank you. Okay. Look, I'll take the BD one quickly and then hand over to Louise with the TCs. I'll let you do that.
Yeah. No, you can go for it.
That's fine. Yeah, look, it's frustrating. I'm sure nobody shares the frustration more of our analysts and shareholders than the team here. I think that one of the key things you mentioned there is what we don't want to do is overpay.
I mentioned earlier that everything we look at has to be accretive to our shareholders. I think we've got a really good, solid platform right now, and we don't want to dilute that by putting a high-cost asset in, or we're going to overpay for something, and it takes too long to get the payback period. It's too long for us to actually be interested. We're abreast down a couple of things we looked at last year. Frankly, we were outbid on one. The others, there were what we considered fatal flaws, either in terms of our technical DD uncovering something that we didn't like, didn't think we could solve technically, that would either push CapEx to a point where the economics didn't look good, or that production rates or OpEx were probably optimistic in the eyes of the vendor.
Value is another one that we often fall over on. There are differences in opinion and outlook. Clearly, there is a clearing price for every asset, but you have to hope people are going to be reasonable. What we all are trying to do is preserve value for our shareholders. That is the third thing that we often run into. What is encouraging on the flip side is the amount of things we were able to review. There is no shortage of opportunities. The challenge is converting on one. If your question is, are we being too fussy, I think the only area we are fussy is on shareholder returns. I think they have to be meaningful for our shareholders for us to pull the trigger on something. Yeah.
Yeah, just in terms of sorry, William, George.
Yeah, sorry.
I was just going to say that. Sorry. I was just going to say thanks, Kevin. That's helpful. Yeah, I'll pass to you, Louise.
Sure. Yeah. Just a quick comment, really, on the treatment charges. There's not much I can give you in terms of the granular detail. Obviously, when we've discussed the treatment charges in 2024, they were much improved versus 2023, $2.9 million saving in 2024 versus 2023. What I can say is when we've looked at our treatment charge terms and our negotiation process for treatment charges from the end of March, beginning of April 2025, through to end of March, beginning of April 2026, we could see so much as a sort of 35-40% improvement on the treatment charges that we would see in general. That's coming through for both zinc and lead averaged out.
Yeah, in terms of treatment charges, currently, it's a good time to be a mining company rather than a smelter in terms of zinc and lead treatment charges.
Thank you, Louise. Very helpful. Just a very quick follow-up, if I may, on the BD side, possibly a student question, but you mentioned in the release that there are a few of those opportunities that went to formal offers. Is it a case that those are no longer active?
Yes. It's a short answer. Yeah. One was a sort of kind of a sales process run by an investment bank that's been concluded. In the other case, we didn't quite get over the line on it.
Okay. Understood. Thanks very much, guys. Cheers.
Thanks, Will.
Ladies and gentlemen, if you have any questions or any follow-up questions, please press star one at this time.
We'll now move to Laura Chan of RBC Capital. Please go ahead, Laura.
Hi, good morning. Thanks for the call. Just one question from my side. Are you expecting to see the costs at SASA trend during the year, considering inflation, the new cost base, and some of those efficiencies that you mentioned?
Morning, Laura. Thanks for the question. Look, I think, as Louise pointed out, with that paste backfill plant being in production for the full year, you do see some of those costs certainly coming through on the SASA cost base. As I mentioned, we're currently commissioning that dry stack tailings plant, and that's going to obviously cost some money to run as well. We are doing it as efficiently as possible. We're sort of multi-skilling people so that they could run.
There are certain elements of both plants which are similar enough for personnel to be swapped between the two when we're running one and not the other. We are going to drive as many efficiencies as we can. I think realistically, once that paste backfill tailings plant is up and running, there is going to be an additional cost to operating that, which will be, I guess, I'm estimating about similar to the
Yeah, about two, yeah. Maybe four in total for the two plants. We are expecting, guiding to and expecting higher production this year than we had last year in terms of run of mine and also in terms of metal. On a per-unit basis, you should see our costs improve effectively.
Okay. Great. Thanks for the question.
Thank you for your question, Laura.
Ladies and gentlemen, as a final reminder, if you have any questions or follow-up questions, please press star one at this time. We do not appear to have any further questions. Mr. Ferrar, I'd like to pass the question over to you for any additional closing remarks. Thank you.
Thank you very much for everyone attending this morning. I hope you got the information you needed. If you didn't, please feel free to contact us with any further questions. As a business, we're very pleased with the results that have gone out this morning. I think it reflects the underlying strength of our cash flows, and the growth aspiration is still there. 2025 is going to be an exciting year. Thank you very much.