Good morning, everyone, and welcome to our Results Call. As always, our executive team is here with me today, and I'll pass to Megan shortly to walk you through the key numbers. Before we start, I'd like to acknowledge the traditional custodians on the land on which we stand, the Whadjuk people of the Noongar Nation, as well as the First Nations people of the lands on which we conduct our business. As always, we pay our respects to their elders and leaders, past, present, and emerging. Turning to our results highlights, our TRIFR remained at the lower end of industry benchmarks at 1.7, as the number of recordable injuries sustained across our business increased from 15 - 16 in FY 2025.
I'm sure you'll agree one injury is one too many, and we remain acutely focused on eliminating high potential incidents that can cause high consequence injuries and have a lasting impact on our employees, contractors, and their families. Nothing is more important. As we know, a safe business is always a more productive business. I'm particularly proud of the way our teams responded to the myriad of external challenges they faced across the last 12 months, including the generational rain event in Botswana and power outages at both MATSA and Motheo. Their tenacity and the growing resilience of our operations shone through as we delivered a 12% increase in group copper equivalent production to 152,000 tonnes to finish the year within 1% of annual guidance. An outstanding result. It's never been just about volume for us.
It's the combination of volume that delivers value that counts, which in itself, of course, requires discipline. Which brings me to costs. While we're starting to see some pressure, which I'll unpack later, our unit costs at MATSA and Motheo of $78 per tonne and $40 per tonne across FY 2025 still compare favorably with the guidance we provided for both assets two years ago. Quite a rarity in an industry that's been plagued by inflationary pressure, particularly in a number of developed economies. That's why we've also seen margin expansion in FY 2025 for MATSA to 45% and Motheo to 60%.
Looking at this holistically, the consistency and predictability we've been striving for at MATSA, yet more success at Motheo as we ramped up beyond expanded nameplate capacity, and generally good cost control at both operations delivered record sales revenue of $1.18 billion and a 46% increase in underlying EBITDA to $528 million for a margin of 45%. Just as our business has been fundamentally transformed across the last two years, so too has our balance sheet, as we charge towards our targeted net cash position. That's the perfect segue for Megan. Over to you.
Thank you, Brendan. I'm pleased to present our financial results for FY 2025. As Brendan touched on, we have delivered record operating and financial results for the year and a return to profitability, underpinned by robust operating and cost performance across the business and healthy pricing for our key commodities, all of which delivered an underlying EBITDA of $528 million for an underlying profit of $111 million and a statutory profit of $90 million. Digging deeper at Motheo, the underlying operations EBITDA increased by 78% to $318 million at a 60% margin, underpinned by strong operating and cost performance and healthy commodity prices. The exceptional ramp-up to 5.5 million tonnes per annum has allowed the operation to realize economies of scale benefits, delivering an operating unit cost of $40 per tonne, 4% below our initial guidance of $42 per tonne.
At MATSA, the underlying operations EBITDA increased by 20% to $292 million at a 45% margin, primarily driven by higher commodity prices and lower TCRC, which more than offset a modest increase in underlying operating costs, primarily associated with a significant rise in stope turnover, mine backfill, and waste volumes in line with the mine plan for an operating unit cost of $78 per tonne, which is in line with revised guidance. Below the line, our D&A expense of $315 million continues to reflect the acquisition of MATSA in FY 2022 and includes a $73 million D&A expense relating to Motheo, which increased by 28% in comparison to the prior corresponding period, in line with the increase in contained copper mined.
Our overall underlying net finance expense of $44 million decreased by 26% in FY 2025 as a result of the significant reduction in net debt during the year and the lower margin that our new corporate revolver facility provides. Our underlying income tax expense increased to $57.3 million for an underlying effective tax rate of 34% as the group returned to profitability. The group's underlying effective tax rate continues to be impacted by the limited ability to recognize benefits associated with tax losses in Australia and the U.S.A . Total capital expenditure across the group remained largely unchanged from the prior year at $208 million as the A4 open pit development was completed for a $49 million investment and reinvested a further $79 million in underground development at MATSA to open additional mining fronts.
Capital expenditure in FY 2026 is expected to increase to $230 million as we invest $25 million on the construction of the new tailings storage facility at MATSA, absorb the stronger euro to USD exchange rate, and invest a further $9 million to complete the A1 infield drilling program and pre-feasibility study at Motheo. As Brendan touched on, our business and balance sheet have been fundamentally transformed across the last two years. We delivered a significant $273 million or 69% reduction in net debt to $123 million at the end of FY 2025, demonstrating the cash-generating capability of our quality operations. In accordance with our newly established capital management framework, no dividend has been declared in respect of FY 2025, as we continue to prioritize the degearing of the balance sheet and rapidly move towards the net cash position, which we anticipate will occur during FY 2026.
These outstanding outcomes across our business continue to give us confidence for the future, and we will remain financially disciplined. With that, I'll hand back to Brendan.
Thanks, Megan. That's a great summary. No doubt the broader slide pack that we released earlier today will be equally helpful for those who love the detail. To the outlook, the 63% increase in copper equivalent production delivered over the last two years has clearly established a stable and resilient platform from which we expect to increase production by a further 2% to 157,000 tonnes this year, which I might add remains unchanged. In saying that, having contemplated the latest market estimates, we thought it would help if we provided the expected production profile across FY 2026. Specifically, our expectation that production will be somewhat skewed with around 45% of half-one metal produced in Q1 and around 48% of full-year metal produced in the first half. This, of course, reflects usual variability in MATSA's mine plan and recoveries and an increasing contribution of high-grade A4 ore at Motheo across the year.
Importantly, our plans at Motheo have also confirmed that we're well positioned to maintain copper equivalent production of circa 60,000 tonnes out to FY 2030, having further optimized our pit shell development plans and increased processing capacity beyond the expanded nameplate rate. On the other side of the equation, at MATSA, we expect unit costs to increase by as little as 1% in euros, which I might add is less than the underlying rate of inflation. This translates to a larger 10% increase to $86 per tonne at a euro to U.S. dollar exchange rate of 1.19, noting the spot rate is closer to 1.16 today. Of course, I know you'll all have your own exchange rate assumptions. Coincidentally, and as we flagged in July, we also expect unit costs to rise by 10% to $44 per tonne at Motheo.
As the A4 open pit achieves commercial production and waste removal costs are increasingly expensed with limited cash impact, additional haulage and handling costs are incurred, given A4's greater distance from the processing facility, which is adjacent to T3, and the recently mandated 50% increase in the power tariff takes effect. More broadly, our exploration and evaluation expense is expected to increase by $6 million to $46 million in FY 2026, as we ramp up activity within the Iberian Pyrite Belt and Kalahari Copper Belt. I should note it's also increasingly likely that this expense will be weighted toward the second half, as our regional program in Botswana is currently suspended while we work to enhance the local approach to risk management, which Jason is now overseeing.
This work will ultimately enhance execution capability and enable us to further accelerate our exploration program that has been designed to identify a minimum of 15 years of life from our strategically positioned processing hubs within five years. Finally, at Black Butte, there's no change in status. The ongoing pre-feasibility study that is scheduled for completion in the December quarter of this year is expected to enable us to define the optimal pathway to maximize the value of our effective 87% interest in the project. In conclusion, and building on Megan's earlier comments, we have the right people, talent, and capability. We have the right assets. We're producing the right commodities at the right time. We have the right balance sheet, and we have the right strategy. With this combination, we're ideally positioned to navigate and prosper in the current environment. With that, let's go to questions. Thank you.
Thank you. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star then two. If you're using a speaker phone, please pick up the handset to ask your question. The first question today comes from Kaan Peker from RBC . Please go ahead.
Hi, Brendan, Megan, and just a quick one on the Motheo resource reserve update. I've noticed that the A1 resource update only appears to incorporate some limited drilling. Maybe if you can give an update on that and when we expect the reserve to be announced, and then secondly, an update on the A4 extension and maybe the T3 put more mineralisation. Thanks.
All right, thanks, Kaan. Appreciate the question. Maybe on the A1 drilling, we're nearing completion there. We're within around four to five weeks of completing that drilling program, spending an extensive program. Of course, as you would know, once you complete the program, you've got to receive all of the assays, and then you've got a detailed process to work through, which very much also requires independent quality control processes. What that really means in summary is that we're anticipating a maiden A1 reserve in around the late second quarter, fourth quarter, I should say, of this financial year, so late second quarter of next calendar year. That's really the status, and we're hopeful of seeing similar levels of conversion, high conversion rates from resource to reserve based on what we see today, but we won't know until obviously we've completed that work.
Maybe Jason, if you want to just go through that broader work stream that we've had underway, testing the extensions, the A4 fold repetition, the footwall at T3, et c.
That's it. Thanks, Kaan, for the question. From our point of view, I might start with A1. If you look at it over FY 2025 and our plans for FY 2026, we'll do around 26,000 m of drilling there. The bulk of that will be infill drilling, and it will also be confirming the extent of that potential resource. Noting that during that infill drilling program, we largely believe that we've defined the strike extent of that and largely defined the down plunge. We have been testing that further. We haven't seen any material change in that. The bulk of our drilling there is obviously then infill drilling, which is going to support that pre-feasibility study, and as Brendan said, enable us to report an ore reserve on that and move forward with the development of that project.
If I come back to A4 and T3, the A4 repetition drilling, we completed that drilling in FY 2025. The results of that were mixed. We did see an extension of the stratigraphy. It confirmed our interps, and we did see an extension of mineralization. At this stage, we are evaluating that, but where I sit today, I only expect potentially some incremental additions there, particularly in the footwall area. If we come back to T3 footwall drilling, we did complete some of that during FY 2025, and particularly when you note that the interpretations of both T3 and A4 have changed quite significantly. Overall, I've been very, very happy with, if you like, the minimal change that we've seen in ore reserve tonnage and contained metal.
In my mind, that confirms that the drilling spacing that we had there on both of those deposits is giving us robust estimates when you can estimate it on two different underlying batteries there and come up with pretty much the same number. If you look forward into FY 2026, we are planning an additional 7,000 m of drilling at T3 and A4. A lot of that will be, and with the new interp, we saw some of our material go into inferred. We'll be looking to promote and confirm that material and also look at some incremental additions along strike at A4. Broadly, if I look forward, we'll be able to publish a lot of those numbers in our next resource and reserve update. At this stage, we're just looking at firming up, particularly T3, A4, and also A1, getting that up to an ore reserve level.
Maybe just Jason, a great summary. The only other thing I'd add, which we're really, I think, pleased with, is having fundamentally changed our view with regards to the structural controls of mineralization that we should note we're also seeing in A1, that all of the work that's been done has confirmed that geological interpretation. You know, one, as Jason said, we're seeing very limited impact on the numbers as we've seen today. That's good. Secondly, it's really helping us as we think about our targeting across the broader basin and particularly within the Motheo hub. Thanks, Kaan.
Thank you.
Thank you. Once again, to ask a question, please press star one on your phone. The next question comes from Adam Baker from Macquarie. Please go ahead.
Brendan and team, thanks for the question and thanks for the outlay of the capital management framework. It appears to be a pretty good indication that a dividend could potentially be on the cards once you reach that targeted net cash position, which could occur in the next six months or so. How should we think about how you're thinking about dividend policies moving forward for Sandfire ?
Yeah, thank you, Adam. Look, maybe I'll just pass to Megan.
Thank you, Adam, for the question. Maybe to highlight in our presentation pack on slide 13, we have included our formal capital management framework. As we are approaching and moving closer to that targeted net cash position, it's the right time to really formalize our thinking in relation to that. Having said that, Adam, I'd say what you see in the presentation is nothing new. It's broadly consistent with how we've been talking about that capital management framework over the past six months or so. Essentially, the framework is going to, it's designed to maximize total shareholder return and per share metrics. Underpinning all of that is our preference for a strong balance sheet and a preference for a net cash position. Going beyond that, we prioritize optimization of free cash flow and investment in safe, consistent, and predictable performance.
Following on from that, prudent investment in infield and extension drilling programs to increase our reserves. We think very much around that, similar to sustaining capital. Beyond that, excess capital will be deployed in the manner that best maximizes total shareholder returns. Discretionary investments will need to basically compete with the alternative of either shareholder dividends or share buybacks. As you touched on, we are moving towards that net cash position. As I touched on in my speech, that will occur sometime in FY 2026, where we do have excess cash on the balance sheet, and only then will we contemplate how do we best return that to shareholders, Adam. We've got franking credits available to us in the tune of $262 million at 30 June 2025, and that presents an efficient and logical mechanism to return cash in the first instance. Brendan, do you want to add anything to that?
Look, I think that's a great summary, Megan. Maybe just a little bit of additional color around the edges. You've, I think, really inferred to this, but one of the things we're quite passionate about is you don't work really hard to get your balance sheet into a net cash position and then actually make decisions that immediately push you back in the other direction. In simple terms, we think about returning excess cash when it's on the balance sheet, not when we can see it forecast in a spreadsheet. We need to see that money on the balance sheet. The second thing I might just add, Megan, it's a really good point. I've seen some people commenting today, and I think it's a good line of questioning around how you're going to have a dividend payout ratio.
I think a dividend payout ratio for us is somewhat problematic to set that in stone because, as Megan just enunciated, we've got a limited level of franking, and given we don't have an asset generating profitability and paying tax in Australia, we're not going to rebuild that. For us, of course, once we've, hopefully at a point in time, distributed those franking credits, we'll be in a position where we really need to contemplate the most efficient way to return capital to shareholders, which I think Megan described well, is when it's in excess of our requirements, can also be in the form of a buyback. That's really a value question or an unfranked dividend. We'd need to think about that deeply. I also want to stress something, and it's really important. The copper market looks as good as any market, I think, in our industry.
The likelihood that it tightens substantially over the next three to five years, I think, is the probability is high. Therefore, I believe that our shareholders see us and have seen us over a number of years as a company that is growing and can grow into a tight market. For us, if we can find opportunities to grow to significantly add values to shareholders, that is obviously something that we should be contemplating. That's really the point that Megan's making around competition. It's always a competition and the relative return or value that we can generate by doing one or all of those things. Hopefully that provides a little bit of clarity.
Yeah, that's clear. Thanks, Brendan. It's been more of a valuation of where you're sitting and, you know, ad hoc payments as opposed to just having a formal dividend payout ratio moving forward, just to give yourself a bit more optionality.
100%. Because, of course, we don't want to lock ourselves in to an irrational, if you like, approach to returning capital if there's a better way than simply paying, for instance, an unfranked dividend.
That's clear. Thank you. I just wanted to ask quickly on the situation with the bushfires in Spain. I know this isn't an operational update, but I'm just wondering if you had a quick comment to see if there's been any impacts there.
No, look, not unlike Australia, you know, going from the wettest winter on record to an incredible heat spell and severe bushfires in Spain and particularly Portugal, I might add. We had a very, very short outage in the underground at Magdalena, and it was purely cautionary, and it was around just smoke in the area and really wanting to again prioritize the health and wellbeing of our people. When I say short, very, very short, there's been no broader impact for us. Obviously, it's something we think about in terms of how we can help local communities, but there's not been any major issues in and around our mine. We're watching it more so as an interested member of the community, more broadly thinking to Portugal as well.
Obviously, from an exploration perspective, we've also taken preemptive action in some areas where we think the risk is higher in this sort of level of heat to actually suspend drilling activity temporarily. Similarly, I think in Portugal. We'll continue to watch that closely. Thanks, Adam.
Thanks .
Thank you. The next question comes from David Radclyffe from Global Mining Research. Please go ahead.
Hi, good morning, Brendan and team. My question's more of a follow-up to Kaan's question on the reserves. I guess coming back to the target that you laid out last December, I know you've been focused on obviously moving to net cash, but do you think the current exploration spend is high enough to deliver that 15 years of life you're targeting within the five-year period, given that we're already one year through that period?
Yeah, look, we've always said, and again, good question, we've always said that, you know, it's a multi-year plan, a five-year plan, and we've always said that the impacts will be, you know, more so back-end loaded. I think I've said many times that when you look at, for instance, MATSA, it's firstly about confirming our thesis and confirming the areas particularly of interest and highest prospectivity, which I think the last 12 months has really aided. Of course, you know, I'm talking primarily around areas like Olivo, San Pedro, and then particularly down depth in the MATSA type area, down dip into the depths there. We've obviously said again today that we're going to complete an exploration drive out into that area such that we can really intensify and target that drilling program. Of course, as you know, in an underground, you never can do these things quickly.
You've got to build up a body of evidence, a body of data. We've always said that it particularly matters, or it's going to take time. When we look at Motheo, it's very much more about regional exploration. As Jason said, we still see A1 coming into the mix, which is really important, and then we see some incremental opportunities. It's really about discovering those new ore sources, which we have no shortage of targets. The most important thing is around having a level of discipline at how we spend that money. I would make the very clear observation as we have success, particularly in a place like Motheo, that spend will go up because obviously we could find ourselves having to drill out and confirm a resource. We'd like to think so. Ultimately, having to define reserves. We're very comfortable at the moment.
One of the things we've thought very carefully about is exploration is an exciting area, but it's also a place where if you don't have discipline, you can destroy capital very, very quickly. We actually think at this stage we've got the rough balance right.
Brilliant. Thank you.
Thank you. The next question comes from Ben Lyons from Jarden . Please go ahead.
Thank you. G'day, Brendan and team. On slide 25 regarding the longer-term production profile at Motheo, it's great to see you're doing what you've previously indicated in terms of trying to bring forward some of that metal and smooth out the production profile. I can clearly see that in the lower chart. Just trying to interrogate the upper chart there where you call out the deferred stripping costs, but then there's also a bit of a reference to what I would regard as other capital being the TSF investment. Just trying to sort of correlate between the two charts there. If we hold the metal strip reasonably flat over the next few years at Motheo, which would be a fantastic outcome, is there anything lumpy to expect on the CapEx side, in addition to that deferred stripping that you've called out in the upper chart? Thank you.
Yeah, thanks, Ben. Good question. I'll pass to Megan in a moment. I'll just make a couple of observations. Firstly, we've gone back and looked at the deferred stripping across, if you like, the last two years and then out three years. Across a five-year period, it's important that we hold ourselves to account internally as much as externally. What we see across that period is the deferred stripping budget is plus or minus within $5 million per annum over that time. What you're seeing is just a resequencing, and Megan can talk to some of that. The reason we don't go out beyond FY 2027, for instance, with deferred stripping is because of things like A1. There's a point at which we may choose to sequence that into the production profile. It starts becoming less and less valuable the further we go out. Hopefully, the guidance does help you.
Of course, you can go and look at what we've provided previously, and you'll see what I'm talking about, how each year things have shifted as we've resequenced, if you like, the pit shells and optimized for value. That's a lot of what Jason's talked about in recent times, which actually obviously helped us a great deal with regards to the floods. Maybe, Megan, if you want to talk about how some of those profiles have changed, obviously what we see directionally and then perhaps around lumps of capital. You talked about the TSF. You talked about a few other things.
Yeah, happy to. Thanks, Ben. Just adding a bit of color on the back of the deferred stripping at Motheo, the graph does show directionally we're expecting a bit of a step up in FY 2027. That's primarily reflecting a major cutback in T3 stage 4. Also noting at that time we'll be, you know, in ore all-bound at Motheo A4. The focus will be on that waste stripping in stage 4 at T3. Looking beyond the profile after 2027, you start to see that coming off a little bit. In terms of the one-off lumpier items in the Motheo capital in FY 2026, Brendan touched on a few of them. I think taking a step back, there's, you know, in the range of $20 million of investment in what I describe as more strategic items for Motheo in FY 2026.
The big item is the A1 and completion of the infield drilling program and the pre-feasibility study. That's in the range of $9 million-10 million. There are also some important items that we carry forward from FY 2025 into FY 2026. Probably the most notable of that is the plant debottlenecking, which we've spoken on previously, which gives us just that extra capacity in the back end of the processing circuit. At MATSA, just closing it out, we've got the investment in the first part of the TSF in FY 2026. We see a $25 million investment associated with that. The other piece that's obviously playing out at MATSA is that upward pressure from a stronger euro. The team's done well given the investment required in TSF in 2026 to also absorb that stronger euro at the same time. Thanks, Ben.
No, thank you, Megan. Maybe just a second one on Black Butte, please. Brendan undertook a very creative transaction by bringing in a passive capital partner into North American copper units and really reducing their CapEx. It looked like a pretty creative and accretive deal. I think we've only ever sort of really considered about Black Butte being a binary Sandfire build it or Sandfire divest it kind of decision point. As you get closer to completing the pre-feasibility study, I guess you're probably starting to think along some other sort of opportunities as well, just whether you'd be able to sort of give us an update on the current thinking about Black Butte and whether it has to be 100% Sandfire or not necessarily. Thanks.
Yeah, look, thanks, Ben. Yeah, you're right. We obviously follow these things closely as well. I think that the deal that Peter and the team at Hudbay did certainly looked to be a good one. Congratulations to them. From my perspective, I continue to believe that there's real value in not making decisions until you have to, but when you do, you move with intent. Where I see us today is in a very good position because the drilling that we've done, we're confident will have a meaningful impact on the quantum of the resource, contained metal. We expect to also show improvement. We obviously think that's going to help the project's economics, given that that lower copper zone is the high-grade ore, which really is going to drive the economics. Of course, all of these things are dependent on the markets. As we've mentioned, the markets are supportive.
I think we've seen consensus also generally rise. We monitor those things. We still find ourselves in a very good position. We expect the updated or new pre-feasibility study to be completed by Sandfire America towards the back end of this calendar year. With that, we expect the updated mineral resource and ore reserve estimate, also including Lowry, I might add. What will be interesting is to get a feel, one, for the economics, but two, the life and whether or not this operation has the potential to produce for 10 - 15 years rather than less. They're the things we're watching. In addition, obviously, peak production is important.
Historically, Black Butte's been thought of as having a peak production rate of somewhere in the order of 30,000 tonnes of contained copper in the early years, drifting back towards the mid to low 20,000 tonnes across a sort of 8 - 10 year life. What will be interesting is to see whether that's changed. It certainly would be helpful if it grows. We're watching that closely. I think the Sandfire America team is doing a good job with our support. I think, Ben, one of the elements that we would consider, and I go back to the earlier point, we have all of the options at our disposal today. We watch these things with interest. It is not a large project.
When you're talking about the sort of scale and quantum, it's probably a little bit more challenging to bring in a meaningful partner because the question is whether you're left with something that then in and of itself is material for yourself. Look, again, we haven't made any decisions. I think we're in a really good position. We think the environment in the U.S. is good. You know, you talk, obviously, I haven't seen the news wise in the last 24 hours, but copper being added to the critical minerals list, probably overdue. We're certainly, again, very optimistic as to what the study will tell us. As we expect at that point, we'll be able to more clearly define the pathway for Sandfire as to how we maximise the value of our 87% effective interest.
Thank you very much for those perspectives, Brendan. Appreciate it.
Thanks, Ben.
Thank you. The next question comes from Tim Hoff from Canaccord. Please go ahead.
I'm not quite sure how to put that question in there. I'll move it on.
No problem. Once again, to ask a question, please press star one on your phone. The next question is a follow-up from Kaan Peker from RBC . Please go ahead.
Hi team, thanks for taking my follow-up. Just on the second half skew for Motheo, I assume this relates to the ramp-up of A4 and the higher speed grade into the plant. Maybe why the second half skew for MATSA. If you can get a bit more detail around that, thanks.
Yeah, okay. Thank you. Jason, you can fill in around the edges. I'll pass to you in a moment. You're right. At Motheo, effectively, you've got the progressive ramp-up of A4 and its contribution. Obviously, its higher grade ore will make a difference as it feeds into the mill. We've said in our release, we talk about it gathering momentum, which we certainly expect it to do, particularly through the back end of this half and then more so into the second half. That accounts for the large skew that we expect to play out there. If we go to MATSA, I think the key thing to be aware there is we have typical variability in the mine plan, depending on where we're mining within the sequence.
For instance, if we're in Castellaritas, which is typically a slightly more challenging ore in terms of recovery and other factors, those sorts of things will always play through. That's really why at MATSA, we see that first quarter, second quarter skew, which is very similar to the numbers I talked about at the group level, sort of 45/55 . Again, I stress for the year, we're not seeing a significant skew at the group level. It's closer to 48/ 52, 50/50 . Both MATSA and Motheo have quite a meaningful pickup in the second quarter relative to the first quarter. We start to see relatively consistent production at MATSA, particularly across the second half, those two quarters, whereas Motheo itself just continues to build momentum. It will finish, I guess, with its stronger quarter occurring in Q4.
Maybe Jason, around the mine plan itself, is there anything specific to call out?
Starting with Motheo, Brendan's absolutely right. If you look at the driver, it's grade increasing, particularly into the second half there. That grade increase is dominantly due to a higher contribution from A4 coming in. If we look at MATSA, we're all aware that we do have higher levels of variability within those ore bodies in terms of grade and metallurgical characteristics. If you look at it throughout the year, overall, copper, we'll start to see that step up after the first quarter, but we'll see a bit of variation there going into and higher zinc levels coming into really the, if you like, Q2 through to Q4 driving some of those key differences. That's about it.
Yeah, I think it's always important to remember, isn't it, Jason, that you get this compounding effect. In some of these ores, we might have slightly lower grade and the metals are a bit more challenging. You also have lower recoveries. The opposite is true when you get into the, let's call them the sweeter spots. You not only get, you know, the better polymetallic type grades, but often you get the higher recoveries going with it. That's why you tend to see this variability. I might add, though, the fact that we're, you know, this washes out across three mines for us means that, at least in my experience, you'll have your own. In the context of a polymetallic mining operation, the level of variability that we're seeing is actually not significant compared to what I've seen in the past.
Thank you. If I can just squeeze another one in, I think we talked about the T3 stage 4 cutback, but what about the A4 stage 2 cutback? When does that come in to be spent?
Sorry, that was the A4 stage.
Stage 2.
We're already in there, Kaan.
Yeah.
We're doing that currently as we're moving down in stage 1.
Yeah, and I think, Kaan, in full transparency, we've been fairly open in the fact that we saw the generational rain event and flooding. Rather than park up equipment, that enabled us to move equipment initially across to T3 and accelerate some of these programs because, again, that will not only use the equipment that otherwise would have sat idle, but also it will set us up well for the future. It puts us, if you like, ahead, creates additional flexibility. The second thing at A4, as we continue to work through the fact that the aquifers there have been heavily recharged and we've therefore got slightly lower rates of, if you like, production than we would have anticipated 12 months ago, we're also utilizing some of that equipment to do exactly what Jason just said, which is accelerate stage 2.
Again, it's all about, I guess, using the equipment that's at your disposal in the most productive way that you can.
Thank you. I'll put it on. Appreciate it.
Thank you.
Thank you. At this time, we're showing no further questions. I'll hand the conference back to Brendan for any closing remarks.
Thank you, everyone. I know it's one of those days for people on the call. We really appreciate your time. I did just want to thank my team, but I also want to thank the broader Sandfire team for their incredible efforts in the last 12 months. The company is in a very strong position, you know, but it's always about the next day, the next week, the next month, and the next year in mining. We're staying very, very focused. As I said, we like the fact we've got a very simple strategy and it's about executing it consistently and successfully. We're looking forward to speaking with you again in September or October on the basis of our first quarter results. Thanks again.