Kenmare Resources (KMR) investor relations material

Operational performance and project update

• Q3 2025 production and shipments declined due to WCP A upgrades, vessel downtime, and a major customer default, with heavy mineral concentrate down 16% YoY and ilmenite down 19% YoY to 209,000 tonnes.

• Finished product output fell 15% YoY, and shipments dropped 25% YoY to 227,400 tonnes, impacted by reduced shipping capacity and customer financial distress.

• The WCP A upgrade project at Nataka, representing 71% of reserves, is over 80% complete, on budget at $341 million, with full capacity expected by year-end.

• Ramp-up of the new plant is underway, with higher capacity dredgers expected to reduce costs and eliminate dry mining by year-end.

• Concentrates production rose 58% YoY, supported by the first commercial shipment of the new ZrTi product.

Financial performance and capital allocation

• H1 2025 EBITDA margin was 30%, with net debt rising from $25 million at end-2024 to $85.1 million by June 30, 2025, reflecting project spend.

• Over $300 million has been returned to shareholders since 2019 through $190 million in dividends and $113 million in buybacks.

• 2025 interim dividend set at USC10.0 per share, with a policy to return 20–40% of profit after tax as dividends.

• Post-WCP A, annual sustaining and improvement CapEx is expected at $30–50 million, with flexibility for opportunistic M&A or increased distributions.

• WCP A project capital cost remains at $341 million, with 80% of spend expected by year-end, funded by cash, debt, and operating cash flow.

Market conditions and outlook

• Global demand for titanium minerals and zircon is subdued, with lower prices due to oversupply, especially from China, but high-grade zircon demand remains stable in China and Europe.

• 2025 ilmenite production guidance is 930,000–960,000 tonnes, now expected at the lower end, with cost guidance at $228–252 million.

• Short-term pricing is weak, but stabilization is expected, with potential recovery toward late 2026 or 2027.

• A major customer defaulted on $9–9.3 million in payments, but title to goods is retained and recovery efforts are ongoing.

• HMC and finished product inventories increased in Q3, with drawdown expected in Q4 as shipping capacity normalizes.