Zeotech Limited (ASX:ZEO)
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May 7, 2026, 4:10 PM AEST
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Earnings Call: Q2 2025

Feb 5, 2025

James Marsh
CEO, Zeotech

Quarter, and also let you know what's happening next. I just brought a slide up there to summarize all the activities from the last quarter, and quite a lot of things happening there. We've been very busy with a small team. First of all, very important, or very importantly though, is the MoU we signed with Holcim Australia. That was a major step forward in the company's progress, being such an important company in the world of building products. That was done first off. We then had made and delivered several hundred kilos of our OzPOS high reactivity metakaolin to the majority of major concrete cement companies in Australia. A lot of work there, a lot of testing going on. Large samples were also sent over to Europe and the USA.

Quite interesting that those opportunities all involve geopolymer applications, which is something that's not quite so big in Australia, but it's certainly very big in those parts of the world. They have had samples there testing. We also started some of our own testing. Very important to get our own data, which we can present. That data is ongoing. It's going extremely well, and we are planning to release that data as soon as it's complete, which should be towards the end of this month or start of next month. During the quarter, we also produced just over 2 tons of OzPOS in a pilot plant production. It took a while initially to get that going smoothly and consistently, but now we are making batch after batch every day, which has got maximum reactivity and very high grade materials. That has been ongoing, and it's still ongoing.

The PFS work, a lot of work going on that space, is going extremely well. We have now engaged consultants to cover every aspect of that PFS and to work closely with the Zeotech team to make sure that we can produce a very professional PFS in the time scale required. Part of that process was to engage Tim Anderson, very experienced executive study leader, importantly experienced in the world of kaolin studies as well. He's helped tremendously, and he joined during the quarter. We've got geotech drilling. That's actually in progress right now up at Toondoon. That is the final drilling required to give us our mine design. Once that's completed in the next couple of weeks, we will have all the data required to complete the mine design. Also, during the quarter, we identified a potential site to produce our OzPOS in Bundaberg Port.

Lots of work gone into that aspect. We also raised just over AUD 1.8 million through a heavily supported company-led placement. That gave us enough money to keep the company going and keep us going through our PFS procedures. Also, during the period, we got an AUD 900,000 R&D incentive back. We got some very encouraging early stage results from the Methane Control Program, which involves the zeolite side of the business. The Queensland Government Metz grant gave us an AUD 145,000 grant, match funding. Very important to get that to help the PFS, not just for the financial aspect, but also the fact that the Queensland Government are very interested in what we're doing now. Once we finalize the PFS, they'll look very closely at what we've done, and then we start discussions on how they can help us going forward.

We got a Japanese patent granted for zeolite technology in Japan. That was a step forward in the zeolite technology. We've also been progressing some DSO opportunities domestically, interestingly enough, but also overseas, where most of that opportunity lies. A very busy quarter, lots going on. Question, what's next? Now we've ticked off those activities, and we're looking forward to the coming quarter. The PFS will be completed second quarter this year. That's on track. It's going very well, and it's going to be a very high quality PFS because we are making sure that we are keeping the project as straightforward, as simple as possible, and using conventional technology. That will be a high standard PFS coming out second quarter this year. We're looking towards securing off-take agreements. Commercially, very important aspect of the project.

We're looking at off-take agreements for DSO, which will get us into some early cash flow, and also for the OzPOS, which will give us the support for the financial case for the plant to produce OzPOS. We are looking at executing an agreement for the proposed production site. Stand by for news on that one. We are also looking at DSO supply activities for that early cash flow. The geotech drilling that is in progress right now will give us the mine design, which we need to open the ground up, which will then lead us into DSO and hopefully some early cash flow. We are also looking at some interesting early stage opportunities to produce OzPOS commercially. We know we can make it. We know how to make it. It is just a case of finding some equipment that is available right now that can make it.

There are opportunities there, and we'll be certainly trying to progress those because the earlier we can get OzPOS out into the market, get the product branding out there, get the product out there being used by people, then the better for the whole company as we go forward. The results that we're doing from OzPOS testing ourselves, then we'll evaluate those results. It's going to be a first stage, and we'll probably lead on to secondary stage testing. Those results should be very interesting. Results that we've got so far are probably, I would say, exceeding expectations. Certainly no problem with the reactivity and the performance of the OzPOS. We would love to get some really high quality data out there into the market, which we aim to do in the coming quarter.

On the zeolite front, we're looking at opportunities to move from the university trials that we did to potential on-site trials, field trials. That is going to be the next stage. We're ramping up, currently ramping up our zeolite production, which uses metakaolin as a feed in readiness for some potential on-site trials. Also, we're waiting for feedback from the half a ton of zeolite that we sent over to North America for testing in animal feeds. That is what's happening next. Now I would like to take any questions that come through, please, Peter.

Peter Zardo
Managing Director, Zeotech

Thanks, James. I'd like to ask a little bit more around the zeolite product. The Japanese patents was an announcement that was made recently. Can you expand a bit more about the scale of the industry, whether it's in Japan, whether it's global, a bit more about that opportunity and the uses of our zeolites?

James Marsh
CEO, Zeotech

Yeah, so the zeolite opportunity is interesting. Now, zeolite is what we call a second horizon product because it needs metakaolin, which is the OzPOS, as a feed before we can produce zeolite. Our first horizon product will be the OzPOS for the construction industry. Once we've got that going, we're going to feed that zeolite, sorry, feed a certain amount of that production into the zeolite production, which will need another plant constructed to make the zeolite. The patent is interesting to get that in Japan, get it granted in Japan. That protects us over there for some IP we have around that material. The big opportunity there probably is in the methane mitigation within Australia at the moment. It's shown in university trials here in Australia that it can potentially absorb very large amounts of methane from landfill sites.

It presents an opportunity for waste disposal companies, and we are working with CleanAway. They could use this material to put a layer down over the landfill site, and that would absorb significant amounts of methane, which you may know that methane is 28 x worse as a greenhouse gas than carbon dioxide. This potentially offers a very simple low-cost solution to mitigating those emissions because the alternative to doing that is to cap the landfill and then use flashing, so burning off the methane, which is very expensive and also a lot of health and safety implications.

Peter Zardo
Managing Director, Zeotech

James, there were some university trials around that methane absorption. Can you expand a little bit more on those results?

James Marsh
CEO, Zeotech

Yeah, we released those results during the quarter, and we got results of around up to 80% absorption of the methane that was being emitted from that landfill, reconstructed landfill situation. This was a university test, quite large sort of IBC type size containers of landfill type material. During that testing, which was run over a long period through different weather conditions, we got those very encouraging results of around up to 80% absorption of the methane. The good thing is that the zeolite that we're using, the zeolite houses the actual organic component that absorbs the methane. This can be just recoated. Once it's put down, it can be just recoated and keep going as the same layer. As a technology, it's interesting because it offers a long-term and very effective solution to the methane emissions.

The methane emissions themselves, there could be a way of monetizing those, which would make this very interesting.

Peter Zardo
Managing Director, Zeotech

Thanks, James. Moving on to Holcim, obviously we're using and producing HRM in other parts of the world. Can you describe a little bit more about how they're using that, where they're using it, what they're finding, and how that relates to our memorandum of understanding with them?

James Marsh
CEO, Zeotech

Yeah, so the testing started initially. We delivered a 400 kg sample of OzPOS to them. They did the first round of testing on that, which was proof of concept testing. The idea was, okay, you've got this product, does it work? Just dropped into a standard concrete mix design. The results from that came back, and they were far better than anyone expected. That was fantastic. Those results were great. Since then, we've now moved on, and we've just delivered 1.1 tons of OzPOS to them. That was delivered recently. That testing will now be expanded to different concrete mix designs to see how to optimize it. OzPOS is a metakaolin, it's high reactivity metakaolin. It's something that's been used in concrete around the world for decades, but not used in very large addition levels.

Now it's being used in larger addition levels because it not only improves the concrete, but it reduces the carbon footprint significantly. The fact that we can produce an economic grade with a very low carbon footprint that is very high reactivity means that we've got something here that obviously Holcim have very interested in looking at. Since we announced that relationship, that's led to samples going out to virtually all the majors in Australia. As we move forward with the principles of the MOU we signed, discussions will move into opportunities for joint venture or maybe profit sharing schemes and potential financing. That'll go on now. As the testing proceeds, then once we get full validation of the product, it'll be a case of, you know, producing much larger amounts to go into live trials.

Live trials will be the next stage where we've already had indications that they might want 30 tons or more to do those trials.

Peter Zardo
Managing Director, Zeotech

Big starting space for shareholders to keep their eye on, James. A lot of this will be contingent upon the PFS, which you discussed in points, areas that the PFS has progressed throughout the last quarter. Can you give us a bit of expansion on that? I believe you're heading up to Bundaberg this Friday as well.

James Marsh
CEO, Zeotech

Yep, certainly. We're moving ahead on all fronts here. Now, the project in it as a whole is quite straightforward. In my experience in industry, this is a very straightforward one. It's because the mining is very simple. There's virtually no refining required of the kaolin, which is very unique in the world of kaolin. The technology that we want to use is off the shelf, tried and tested. Been working for, in fact, it's been since the 1800s to make this. It means that PFS is much more straightforward than normal, but it's still a lot to do. There's still a lot of work to do. We've got expert consultants now engaged in every aspect of the PFS, along with the Zeotech team who are covering the specialist sections. At the moment, as you mentioned there, Peter, we're going there tomorrow.

The geotech drilling is in progress. There's some other work going on around the mine site tomorrow. We're going to the Bundaberg Port to discuss use of a potential site there for operations. We're taking logistics consultants there who will film and track and examine the whole transport route all the way from pit to port and look at the access road and the access road where it joins the council road. There's a lot happening in that space. We also are going through the modeling, which is very important. The project modeling is well advanced, and we are feeding all of the OpEx and CapEx details that we're getting into that model. We are working very closely with the other consultants that are involved, which includes, of course, the geologists, the mining engineers, and the environmental people.

Peter Zardo
Managing Director, Zeotech

James, there's been a few questions come through, which obviously will relate to the PFS. I think that those questions will be answered once the PFS is delivered and we can analyze the data that comes from there. There are things to do with mine design, supply and demand for the products, etc. For those of us, those questions, if you've got some specifics, please send them through to me at peter@nwrcommunications.com.au. I'll make sure that James gets them because he'd be happy to engage. Many of these questions will relate to the PFS, which I'm sure you're looking forward to delivering very soon, James.

James Marsh
CEO, Zeotech

Yes, oh yes, definitely. No, we're working very hard to get that on. It's on track. I know the project management is being very well controlled by Tim and the team. It's on track. Things are moving along. As I said, we're trying to keep it simple and straightforward. We are aided considerably by the fact that from a commercial perspective, usually with kaolin projects, and although this is not strictly a kaolin, it's a metakaolin, the commercial side is very difficult. It's the hardest part of the whole project to overcome. This is different. I might have mentioned before in a presentation that in all my years in the kaolin industry, this is the first time we've got a project where customers are actively seeking this product. They want it, they're asking for it, and they do need it.

Now, the construction industry needs us to decarbonize. That means that the PFS has got a lot of advantages over normal PFSs. Yeah, definitely, we're all very keen to get this done on time and looking forward to getting that news out in the second quarter this year.

Peter Zardo
Managing Director, Zeotech

All right, thanks, James. Given this was predominantly an update on the quarterly milestones achieved and an outlook going ahead, I think we've covered those. I am looking forward to a more comprehensive presentation to shareholders in the near future as you have some more news to deliver.

James Marsh
CEO, Zeotech

Yep, thanks for your time, everybody, and looking forward to being able to give you more news in the future.

Peter Zardo
Managing Director, Zeotech

Thanks very much, James. Thank you for everybody attending.

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