Operator: Good day, everyone and welcome to today's AMG Q1 2023 Earnings Conference Call. [Operator Instructions]. It is now my pleasure to turn today's call over to Michele Fischer. Please go ahead.

Michele Fischer: Welcome to AMG's First Quarter 2023 Earnings Call.

Joining me on this call are Dr. Heinz Schimmelbusch, the Chairman of the Management Board and Chief Executive Officer; Mr. Jackson Dunckel, the Chief Financial Officer; and Mr. Eric Jackson, the Chief Operating Officer. AMG's first quarter 2023 earnings press release issued yesterday is on AMG's website.

Today's call will begin with a review of the first quarter 2023 business highlights by Dr. Schimmelbusch. Mr. Dunckel will comment on AMG's financial results, and Mr. Jackson will discuss operations.

At the completion of Mr. Jackson's remarks, Dr. Schimmelbusch will comment on strategy and outlook. We will then open the call to take your questions. Before I pass the call to Dr.

Schimmelbusch, I would like to expressly refer you to our statement on forward-looking statements and the meaning thereof, as which have used on previous occasions and will -- and we use at this earnings call and which explanatory statement has been published as part of our financial presentation and on our website, all in connection with this earnings call. I will now pass the floor to Dr. Schimmelbusch, AMG's Chairman of the Management Board and Chief Executive Officer.

Heinz Schimmelbusch: Thank you, Michele. As announced and subject to approval of our shareholders at our Annual General Meeting later today, AMG will change its name from AMG Advanced Metallurgical Group N.V.

to AMG Critical Materials N.V. We achieved record earnings and record operating cash flow in the first quarter of 2023. Revenue increased by 12% to $451 million versus the first quarter of 2022. EBITDA increased 116% to $118 million compared to $55 million in the first quarter of '22. This is the third straight quarter in which AMG has exceeded $100 million of EBITDA.

The $63 million EBITDA increase over the first quarter of '22 was driven largely by the Clean Energy Materials segment specifically AMG Lithium and its Brazil operation with an EBITDA contribution of $92 million. Our expansion projects remain on track. The lithium concentrate expansion project in AMG Brazil is processing as planned and our hydroxide refinery in Bitterfeld, Germany is under construction, with commissioning for the first 20,000-ton module expected in the fourth quarter of '23. With regards to resource development, AMG purchased a 25% shareholding in Zinnwald Lithium Plc and is supporting the Zinnwald Board to accelerate the development of this project. As a partner with Zinnwald, together, we will pursue a definitive feasibility study for the project in East Germany, establishing a raw material base in Germany goes to our Bitterfeld operations as obvious logistical and strategic benefits to AMG.

Regarding solid-state battery activities, AMG Lithium GmbH has engaged in a joint production project with Fraunhofer Münster University, [indiscernible] to develop next-generation solid-state battery build on lithium sulfur technology. AMG Lithium will provide lithium sulfide and solid electrolytes for this project. The new spent catalyst recycling facility in Zanesville, Ohio continues to progress with the roaster operating at full design capacity and the meltshop targeting full production capacity later in the second quarter this year. That might be earlier. AMG has completed the expansion of its vanadium oxide, referred to as V205, production in Nuremberg, Germany, which is capable of using gasification ash and spent catalysts as feedstock.

V205 is increasingly testing for the [indiscernible] battery market. Shell AMG Recycling B.V. continues to advance its projects in the Middle East, including the first phase of the so-called supercenter project based on long-term supply agreement with Aramco. Front-end engineering design for the first phase of the project, the conversion of gasification ash into V205 began in late '22 and will be completed in the fourth quarter of '23. I will now pass the floor to Jackson Dunckel, AMG's Chief Financial Officer.

Jackson?

Jackson Dunckel: Thank you, Heinz. I will be referring to the first quarter 2023 investor presentation posted yesterday on our website. Starting on Page 3, that shows an overview of the financial highlights of the quarter. Revenue for the quarter increased versus the prior year by 12% to $451 million. This increase was mainly driven by the improved price environment in our AMG Clean Energy Materials segment.

Q1 2023 EBITDA was $118 million, a 116% increase versus the prior year. As you can see in the lower left corner, AMG continues to sequentially increase EBITDA each quarter. Net income to shareholders increased to $56 million for Q1 '23, yielding $1.72 of diluted earnings per share compared to $0.89 in Q1 '22. Now I'm going to review our 3 segments. Starting with AMG Clean Energy Materials, which is shown on Page 4 of our presentation.

On the top left, you can see that Q1 '23 revenues increased 53% versus Q1 '22 to $219 million. This increase was driven mainly by higher prices in tantalum and lithium concentrates, as well as increased sales volumes of vanadium and tantalum concentrate. Increased volumes in vanadium were due to the ramp-up of our Zanesville facility. Q1 '23 increased -- Q1 '23 EBITDA increased to $106 million from $37 million in the first quarter of '22, largely driven by our lithium business. I would like to highlight the cost per ton delivered to China, which was $338 per ton for the period ending March 31, 23.

This is a world-class result, and it is partially due to having a very strong tantalum business. As we previously discussed, the tantalum revenues are used as a cost offset to the cost per ton of lithium concentrate. This effect was particularly noteworthy in Q1, where similar to our fourth quarter, the cost per ton figure was positively impacted by high shipments of tantalum. And finally, the quarterly CapEx shown on the bottom left of $43 million, mainly reflects our investment into a battery-grade lithium hydroxide plant in Bitterfeld, Germany, and the expansion of our lithium concentrate capacity in Brazil as well as ongoing residual investment into the Zanesville vanadium facility. Turning now to Page 5 of our presentation, which shows AMG Critical Minerals.

AMG Critical Minerals revenue for the quarter decreased 41% to $63 million compared to Q1 '22 due to lower volumes across the segment, which was primarily driven by the silicon metal care and maintenance plan for the first 2 months of this year prior to restarting and operating 1 furnace in March. The segment also suffered from a slowdown in the European industrial economy, which impacted volumes in both graphite and antimony. Q1 '23 EBITDA decreased 68% compared to Q1 '22 to $3 million due to lower volumes. As of March 1, 2023, AMG's silicon metal plant we started operating -- restarted operating 1 furnace, which will continue through the second quarter with plans to operate 1 furnace in the third quarter as well. We will continue to review the operational parameters of the silicon business on an ongoing basis and will adjust as appropriate in line with the favorable and predictable market conditions.

Due to these interruptions in the silicon business, the financial results will be excluded from EBITDA during this period of abnormal operations. However, AMG Silicon generated $11 million in cash flow from operating activities during the quarter driven by the receipt of energy sales made in the fourth quarter of 2022. As noted previously, the financial impact of the care and maintenance program does not significantly impact AMG's overall projected 2023 financial results. Moving on to AMG Critical Materials Technologies on Page 6. Starting on the top left, you can see that Q1 23 revenue increased by $15 million or 10% versus Q1 '22.

This improvement was due to higher sales volumes of titanium alloys and chrome metal. EBITDA was $9 million during the quarter compared to $10 million in Q1 '22. The slight decrease is due to lower -- due to lower sequential chrome prices, partially offset by stronger profitability from our Engineering business. AMG Engineering signed $76 million of new orders during Q1 '23, driven by strong orders of remelting, turbine blade and heat treatment furnaces, representing a 1.21x book-to-bill ratio. Order backlog at the end of the quarter was $237 million, the highest since March 31, 2020.

Turning now to Page 7 of the presentation. On the top left, you can see that AMG's Q1 '23 SG&A expenses were $40 million versus $37 million in Q1 '22. This increase was largely driven by the higher personnel costs and variable compensation expense due to the increase in headcount related to the lithium and vanadium expansion projects in our Clean Energy Materials segment. AMG's net finance costs in Q1 '23 was $7 million compared to $9 million in Q1 '22. This variance was mainly driven by foreign exchange gains of $2 million during the quarter, which were due to noncash intergroup balances.

AMG capitalized $2 million of interest costs in the first quarter of '23 versus a capitalization of $4 million in the same period in '22. This decrease is mainly driven by the interest associated with the expansion projects in AMG Lithium and Brazil operations compared to a higher capitalized interest associated with the company's tax-exempt municipal bond supporting the vanadium expansion in Ohio in the prior year. AMG recorded an income tax expense of $36 million in the first quarter of '23 compared to a tax benefit of $1 million in Q1 '22. This variance was mainly driven by higher profitability at AMG Lithium at its Brazil operation, coupled with movements in the Brazilian real. The effects of the Brazilian real caused a $2 million tax expense in Q1 '23 compared to a $15 million tax benefit in the same period in '22.

AMG paid taxes of $21 million in the first quarter of '23 compared to tax payments of $4 million in Q1 '22. The higher cash payments in the current period were largely a result of higher profitability in Brazil. Turning to Page 8 of the presentation. You can see on the top left that cash from operating activities was $93 million in Q1 '23 compared to cash used in operating activities of $4 million in the same period for 2022. This increase in operating cash flow was due to the higher profitability in the current period.

AMG's return on capital employed for the first 3 months of the year was 37.9% compared to 19.8% achieved in the first 3 months of last year due to significantly higher profitability. AMG ended the quarter with $311 million of net debt with the decrease versus year-end '22 mainly due to $10 million of debt repayment and higher unrestricted cash of $14 million, offset by the utilization of restricted cash associated with the municipal bond. As of March 31, 2023, AMG had $360 million of unrestricted cash and total liquidity of $555 million. That concludes my remarks. Eric?

Eric Jackson: Thank you, Jackson.

AMG's operations continued to perform exceptionally well during the first quarter, especially in the context of today's volatile markets. Consistent with our previous statements, we expect our spent catalyst processing facility in Zanesville, Ohio to achieve full production capacity later in the second quarter 2023. This means that our 2023 production volumes will be somewhat back-end weighted for the year. The lithium concentration -- concentrate expansion project in Brazil is now slated to temporarily shut production in Q3 to integrate our expansion. This will take place over a 4-week period and will result in reduced production in the third quarter.

However, our expectations are that the subsequent ramp-up will be shorter than originally planned. We believe, net of co-product credits, we are at or near the low end of the global lithium concentrate cost curve. This is borne out by the $408 per ton CIF China cost we have averaged over the 12-month period ending March 31, 2023, 11% better than our full year 2022 cost of $461 per ton. That trend continues to improve as we averaged $338 per ton for the first 3 months of this year. Major drivers of the lower cost in the quarter were lower mining costs and higher tantalum sales.

It's worth restating that 100% of our tantalum concentrate production is sold under the terms of our joint venture with JX Nippon Mining & Metals Corporation. AMG Lithium's battery-grade lithium hydroxide refinery in Germany is under construction and commissioning for the first 20000-ton module will start in the fourth quarter of this year. In January '23, we announced approval for a vanadium electrolyte plant expansion in AMG Titanium in Nuremberg, Germany with target capacity at 6,000 cubic meters of vanadium electrolyte produced from secondary feedstocks. Construction has started and commissioning and production are expected to begin at the end of 2023. As of March 1, 2023, AMG silicon metal plant in Pocking, Germany, restarted operations, running 1 of our 4 furnaces.

AMG Silicon will operate in this manner, at least through the third quarter. And as Jackson mentioned, we will continue to review the operational parameters of the silicon business and adjust as appropriate in line with favorable and predictable market and cost conditions. In terms of our Critical Materials Technologies segment, AMG Engineering had a book-to-bill ratio of 1.21x at the end of Q1 '23 and has had an exceptionally strong order intake to date in the second quarter. We continue to focus on safety, operational improvements, risk management and successfully delivering our strategic projects on time and on budget. Our overriding objective is to be the low-cost highest quality and most environmentally responsible producer in all of our businesses.

I would now like to pass the floor to Dr. Schimmelbusch, AMG's Chief Executive Officer.

Heinz Schimmelbusch: Thank you, Eric. The increased profitability going forward is very much driven by the strategic projects coming onstream in '23 and '24, in particular, Zanesville, the vanadium recycling operation, our lithium concentrate expansion and our first lithium hydroxide refinery module in Bitterfeld, Germany. In terms of this year, AMG reaffirms its guidance to exceed $400 million EBITDA.

Regarding AMG's 5-year guidance, the outstanding progress we have made with our strategic growth projects and given the compelling long-term supply and demand dynamics in the lithium market, we are issuing new guidance to achieve $650 million EBITDA or more in 5 years or earlier. Operator, we would now like to open the line for questions.

Operator: [Operator Instructions]. And we will take our first question from Stijn Demeester with ING.

Stijn Demeester: Yes.

Yes. I have three to start with, if I may. The first one is on AMG Brazil. If I compare your Q1 average selling price for spodumene to the Q4 reported price and I take into account the 3- to 4-month lag, AMG seems to be able to better capture or capture a better share of the spot price. So anything particular that drives this change with regards to sort of the better market pricing?

Heinz Schimmelbusch: Well, don't read too much into this analysis because the shipments at quarter end, variations of shipments, variation of recognition of sales in the quarter.

And so it's, the yearly or average, it's a better number. So I don't think that there is any particular answer I can give.

Stijn Demeester: Okay. Okay. Maybe related, amidst the recent price declines seen in the Chinese spot markets, especially with lithium carbonate.

Can you help us understand what gives you the confidence to reiterate the full year '23 guidance? Also noting that there will be downtime in Q3. So any sort of comfort you can give to the market because I think that's sort of one of the concern that is currently in the marketplace.

Heinz Schimmelbusch: Let me first of all say that we do this guidance very slowly. So we run a host of scenarios, as explained many times. And then we have various analyses of each of those scenarios.

And then we select what we believe are the most realistic scenarios and we look at it and then we come to the conclusion of the guidance. Now in '23, there will be an interruption of production of whatever 2, 3 weeks in Q3 when we switch from flow sheet, from the traditional flow sheet to the new flow sheet in the operation of spodumene production in Brazil. But that will be overcompensated by a rapid increase of production this year, substantial increase. Please note that, that substantial increase is also accompanied by a substantial increase of the tantalum production. So both lithium and tantalum will be higher in Q4 as ever before.

Please also note that tantalum is 100% sold and lithium is 100% sold under long-term contract. This, by the way, is also true for ferrovanadium. We will very shortly now reach -- as we speak, actually, we are running at 100% capacity in Zanesville. So the ferrovanadium production, which is also sold under long-term contract will contribute to the overall picture, vis-a-vis, in '23. So we have a strong quantity effect here.

The price assumptions are extremely conservative. We are, of course, benefiting from the retail prices really in the first quarter reaching into the second quarter. But always remember, spodumene prices and hydroxide prices and carbonate prices have very different volatilities. The hydroxide prices went down slightly. The carbonate prices went down heavily.

The spodumene prices in between but much less than the carbonate prices. So we are in a good sector of the lithium market. By the way, that extends into the future because in hydroxide we will produce, we will produce hydroxide in our refinery. So that's what makes us comfortable to reaffirm our guidance.

Stijn Demeester: Yes.

If I may comment on this because this comes back to my first question. Has there been a change in the contract structure recently that makes you less dependent to the lithium carbonate price in China?

Heinz Schimmelbusch: No, we have -- in the price picture, there are reviews -- review of -- review dates at which the parties adjust the prices and . And that is ongoing and has not a specific effect. It's just a solid performance. So I can repeat what I just said, look at the quantity of expansion, if you look at the -- and multiply it by prices, which, look at 100% low quantity risk.

You're talking to a company which has sold its production 100% under long-term contracts, this is, at market prices. So this is relatively there.

Stijn Demeester: Yes. Understood.

Heinz Schimmelbusch: Our visibility is very strong.

That's what I'm saying here. I mean, if I was an analyst, I also would be skeptical. I'm always skeptical but if -- I'm not an analyst. I'm producing.

Stijn Demeester: Understood.

Understood. The final question is on the portfolio organization because even with these outstanding results, valuation looks increasingly sort of low. Is there an update to give here on how you organize the business, particularly divestments which -- of businesses which sort of are increasingly seen as noncore and a diversion to management attention. So yes, any comments here on that?

Heinz Schimmelbusch: I very much like your reference to management attention because I can really answer what my management attention is. My management attention is on execution of strategic projects because the profitability of management time spent on strategic projects exceeds the profitability of management time in selling assets.

Now let me talk about selling assets. Of course, we have a few assets which could be addressed as noncore, if you have to address categories, you can address them as noncore. These assets, by the way, are cash positive. So that reduces the haste by which one would pay attention as management in comparison to strategic projects to that issue. And then there is another element, when you look at a potential dispossession of assets, you obviously compare the present value of the existing cash flow from that operation to the present value of the cash you would have, assuming that you have sold at a particular price.

Now in most cases, when we look at this, the sales prices are low, the potential sales prices are low. So the present value of the free cash flow from those operations exceeds what we would have as a free cash flow after the sales on an annualized basis. So as I said, we are looking at this very carefully, constantly. We are focused on execution of our strategic projects because that's a full-time job. And if there is an opportunity arising that this equation, which I just characterized as a net present value comparison, if that equation goes into a positive territory, we, of course, will react.

Stijn Demeester: Okay. There is a third element in the equation being the market -- the price that the market is willing to pay for a conglomerate. So that is potentially also...

Heinz Schimmelbusch: Of course. What you are talking about is that we -- if we sell something, then the market would reward this by higher stock price, even if we are selling it at a bad price.

That's what you're saying. That's a difficult statement.

Operator: [Operator Instructions]. And we will take our next question from Martijn den Drijver with AMRO. Martijn

den Drijver: It's actually ABN AMRO.

My first question is on the longer-term ambition level or target level for EBITDA and the $500 million that has now moved to $650 million. Is there any Scope change in that updated guidance because it's 5 years, so we're talking 2028? Have you now included possibly some effects of a Brazilian conversion plant or [indiscernible]? And if there's no change in the Scope that you've used for that upgraded long-term guidance, what is the key component for the raise from $500 million to $650 million? That would be question 1, please.

Heinz Schimmelbusch: Well, first of all, the -- looking at that time line, you look at 2 modules of the refineries. So we believe that the execution of the expansion of Bitterfeld will be rapid. So there is the second refinery, the refinery profitability is extensive.

You can measure that by the difference between carbonate prices and the hydroxide prices in a certain way, although one has to be very specific here. I know that quality -- the qualities in detail but there is a substantial profitability associated with those refineries. Then you have the expansion of Brazil operations into carbonate. That is a substantial move. We are in a very mature stage of feasibility there and we have financing alternatives, which are very attractive.

And as you know, the key to -- of converting spodumene into [indiscernible] technical grade or carbonate technical grade in China and then refining in Germany, that is a long journey, which involves working capital and costs and the direct delivery from Brazil to Germany is extensively profitable compared to the detour. You have, of course, then the full production of 2 recycling facilities in Ohio, the world's largest, the world's largest such operation, which is in all likelihood of operating at a very high capacity utilization and 100% of its products are sold. So under long-term contracts, when you take this together with the expansion in Brazil of the spodumene production, the tantalum production, the carbonate production in Brazil and when you take this with the second refinery, in production, you easily arrive at a pretty high number, which makes us very comfortable to say $650 million. We could have also said a higher number if we were in a sort of aggressive mode but we are not, we are conservative. Martijn

den Drijver: Got it.

Then on my second question, I was hoping to pick your brain a little bit. The lithium prices seem to be bottoming out. And I was wondering if you could provide how you view this? Is that due to more demand and restocking in China? Or is it perhaps linked to the developments in China? If you could share your thoughts on the recent price developments in lithium.

Heinz Schimmelbusch: I read your question in such a way that you believe that the origin of the major movements are in China and that is correct. And we analyze this on a weekly basis, on a daily basis sometimes.

The turnaround is visible and is confirmed by the figures which we receive on this. So it's now driven by impressive figures of EV demand and sales of cars. And there has to be a restocking happening. And those movements can be relatively rapid because it's a chain reaction. And has to be observed in all these kinds of volatile commodity markets.

So we are moderately positive that this will turn around and return to somewhat higher levels whether we -- I mean, our internal optimists say it will rebound to the previous heights but I'm more moderate here. Given my age, I'm sort of cautious. Martijn

den Drijver: Understood. Understood. You said -- Jackson referred to Cambridge 2, that it will be fully contributing somewhere in the second quarter.

If we take the potential EBITDA contribution of Zanesville or Cambridge 2 and you look at the EBITDA contribution in the first quarter, what was the percentage? Was it running at 25% of aimed for EBITDA contribution, was it at 50%? Just give us a sense of what type of uptick we can expect in the second quarter and third quarter.

Heinz Schimmelbusch: In the first quarter did almost nothing. I mean, there was no contribution of Zanesville in the first quarter to speak of. So in percentages, I would say, below 10%. The ramp-up will be significant.

Martijn

den Drijver: And so ramp-up in the second quarter, really 100% contributions in the third quarter. Is it correct when you think about...

Heinz Schimmelbusch: We are right now in the second quarter. The last week, we were running at full capacity. So if this is stabilizing, then of course, you can -- a substantial portion of the second quarter will be then benefiting from that production.

But this is a complex facility. We are extremely proud to have reached full capacity ahead of schedule that we believe to have reached full capacity. As I said, the roaster is stabilized, running on 100%, producing roasted material. But that, of course, has to be turned into ferrovanadium in order to be financially rewarding. And the meltshop is now running at 100% for the first time in a stable way.

So if that is continuing, it will be now a very strong contributor for the rest of the year. Martijn

den Drijver: Got it. And my final question is with regards to CMT and chromium pricing. You've obviously had some headwinds due to the more recent price developments in chrome, down sequentially, the last 2 quarters. Should we assume now that you, in Q2, will have the ability to pass on those effects that EBITDA will be -- will improve in line with the recovery that you've guided for, for CMT, for technologies?

Heinz Schimmelbusch: Yes.

We believe, first of all, the background in aerospace is positive, chrome, in its high end and therefore, in this most profitable product qualities, is going to aerospace, especially to the aerospace engine and to high-performance steel, highly alloyed steel, which essentially is 20% chrome metal or so. And therefore, we are a function of the recovering aerospace market, which is very strong going forward. Secondly, we were low performing and are still low performing in chrome because of the turbulences which were caused by the happenings in the regions where chrome oxide is being produced and that is in Russia, Kazakhstan and China. And these turbulences have muddied the water in chrome. So as that stabilizes, which I think is underway, more visibility will return and substantial incremental EBITDA is likely.

So we will return to that. I mean, from practically zero to maybe that the intrinsic, the intrinsic EBITDA of the chrome business, in my definition, is $20 million to $30 million a year EBITDA intrinsic. And which, we missed that $20 million to $30 million in the last quarters because of that volatility in the oxide markets, when certain producers in China and other places in the East, simply flooded the market and that was confusing. Martijn

den Drijver: Got it. And so your expectation of stabilization of that market, is that really visible in objective measures? Or is it just an expectation at this moment?

Heinz Schimmelbusch: The future is never measurable.

It's just, you have to take my judgment here as the measure. We know those markets clearly.

Operator: [Operator Instructions]. We will go next to [indiscernible].

Unidentified Analyst: It's of [indiscernible].

And few questions from my side. And when you mentioned the building blocks to get to $650 million EBITDA in 5 years' time, I did mention -- I did miss the contribution of Shell AMG or is this purely from an accounting point of view that it won't be included in EBITDA?

Heinz Schimmelbusch: That's correct.

Unidentified Analyst: Okay. And do you have...

Heinz Schimmelbusch: Let me comment.

We are in as we projected -- who's -- breeze in here -- in FELC feasibility study of the hydrometallurgical conversion plant, the gasification ash into V205 there and that is a very large investment. It will be then under construction. And then it is -- it will, of course, come out in the 5-year period. So this will be equity accounting and it will happen in the net income. So not in the EBITDA.

Unidentified Analyst: And are you willing to provide some guidance range what does that kind of contribution that might bring to net income?

Heinz Schimmelbusch: No.

Unidentified Analyst: Okay. And then secondly, to get to the $650 million, you have to make substantial investments. At , you mentioned that you will make some $1 billion of investments in lithium. When I add your current investments and what you have made, then more or less I arrive at $250 million to $300 million, so if corrected, you still have to make some $700 million, $750 million to be able to achieve this $650 million EBITDA level.

Heinz Schimmelbusch: I don't get this arithmetically, this mathematical, what you said.

Jackson Dunckel: Let's go over the $250 million, Martin, what do you have?

Unidentified Analyst: I have the initial investments in [indiscernible]. I also take a large part of the expansion plan, most of the first module 1 and the investment in Zinnwald.

Jackson Dunckel: And I see what you're guiding towards.

Unidentified Analyst: And then you already have announced more or less the magnitude what will be for modules 2 to 5, the technical grade lithium carbonate 1 and the battery grade lithium carbonate 1.

And then there's still a portion which you have not disclosed yet where you will invest that. But more or less, when I add those numbers then, I do arrive at some $250 million to $300 million of investments you already have made.

Heinz Schimmelbusch: Okay. So let's -- let's go through it again. What has been addressed so far, including the expansion in Brazil, let's name it $150 million.

Let's add the carbonate with $250 million in Brazil, so that they're at $400 million. Now let's add $150 million for the infrastructure plus the first module altogether, we were at $400 million plus $150 million, that's $550 million. Let's add another module, including certain [indiscernible] for being able to receive all quantities of technical trade things, $100 million. Where were we?

Jackson Dunckel: $650 million now.

Heinz Schimmelbusch: $650 million now.

Let's take an investment in a resource such as Zinnwald, which will need, of course, like the Zinnwald owner, the Zinnwald company, of course, is not having a cash flow. So this will be project financed and we will be, of course, participating in this in order to provide the equity for the project financing. So if you add this $200 million, just as an example. There are other resource projects, one of which will be probably announced later this year. So we will be, I think, running through that $1 billion relative quickly.

Unidentified Analyst: But then again getting back to the core of the question is, how much do you still need to invest in the upcoming years to achieve this $650 million of EBITDA.

Heinz Schimmelbusch: What is in the...

Jackson Dunckel: $500 million.

Unidentified Analyst: Okay. Okay.

And then lastly, you have clearly upped your midterm EBITDA guidance. In your annual report, you also introduced a kind of guidance that you stated that over the period to 2026, you expect an average EBITDA of more than $400 million. Should we then conclude that the upward towards the $650 million will be more or less back-end loaded? But that's a bit contradictionary to what you just stated that a lot of new products will get onstream in 2023 and 2024. So then already, we should see a hike in profitability?

Heinz Schimmelbusch: No, that -- it's not back-end loaded. It's -- a very big move will come in '24.

And that will be -- so it's harmonical. It will be not -- it's not heavily back-end loaded. Of course, the second module that comes in the later part of this 5-year period, that is a significant incremental EBITDA.

Operator: [Operator Instructions]. And it does appear that we have no further questions at this time.

I will turn the call back over to Michele Fischer for closing remarks.

Michele Fischer: This concludes our Q1 2023 earnings call. We will host our Annual General Meeting at 1 p.m. today in person and we will also stream the event. Thank you for your kind attention.

Operator: Thank you. And this does conclude today's program. Thank you for your participation. You may disconnect at any time.