Kenmare Resources (KMR) Status update summary

Strategic focus and market environment

• Emphasis shifted from production targets to maximizing shipments, sales, and cash generation in response to weaker pricing and high inventories.

• Market for titanium minerals and zircon remained stable in demand but faced oversupply, especially from increased Chinese production, impacting prices.

• 2026 strategy prioritizes value over volume, targeting shipment volumes above 1.1 million tonnes, a 15% increase YoY, with production flexed to meet demand.

• Strong Q1 2026 order book, with new sales contracts and continued demand for high-quality ilmenite and zircon products.

• Company is a major contributor to Mozambique's GDP and a significant global supplier, focusing on long-term sustainability and stakeholder engagement.

Operational and capital updates

• 2025 production was down 15% due to the WCP A upgrade, with ilmenite down 17% and HMC at 1,233,300 tonnes; concentrates rose 124% due to new product ZrTi.

• Shipments in 2025 fell 13% to 947,900 tonnes, affected by weather and vessel downtime; 2026 targets >1.1Mt, a 15% increase.

• WCP A upgrade project cost $341 million, over 80% spent by year-end, with construction complete and commissioning ongoing.

• WCP A will mine in the Nataka zone for over 20 years, securing long-term production.

• Full capacity for WCP A targeted in Q1 2026, with remedial measures addressing commissioning bottlenecks.

Financial and cost management

• 2025 ended with $48.6 million in cash and net debt at $158.8 million, elevated due to capital spend.

• An impairment charge up to $300 million will be recognized in 2025, reflecting lower asset values and pricing assumptions.

• Inventory write-down of about $15 million anticipated due to net realizable value below production cost.

• Total cash operating costs for 2026 are guided at $215–225 million, with per-tonne costs of $240–250.

• Development CapEx to drop significantly in 2026, with $30 million for WCP A and $30 million for sustaining capital.