Release Date: August 27, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Chrysos Corp Ltd (ASX:C79, Financial) reported a substantial revenue increase of 69% year on year, reaching $45.4 million.
- EBITDA surged by 156% over FY23 to $9 million, with an improved EBITDA conversion rate of 20%, up from 14% in FY23.
- The company has a strong financial position with $61 million cash on hand and an undrawn $95 million banking facility.
- Chrysos Corp Ltd (ASX:C79) successfully deployed 29 PhotonAssay units, up from 20 at the start of the financial year, and signed four new contracts post year-end.
- The company is expanding its global footprint, with significant growth in the EMEA region (211%) and the Americas (203%).
Negative Points
- Despite the revenue growth, the global gold industry remains in a relatively slow environment with low exploration spend, impacting overall market conditions.
- The company experienced some misses regarding deployments during the year, indicating potential operational challenges.
- There are concerns about slow collections from certain regions, although the company has high-quality counterparties.
- The industry is still bouncing along the bottom of the cycle, with no significant uptick in exploration spend observed yet.
- The company faces high capital expenditure for PhotonAssay units, which requires careful financial management to align with revenue generation.
Q & A Highlights
Q: Can you provide more context on the potential for expansion with SGS and their positioning in the market?
A: SGS is the largest provider of on-site laboratories in the gold space globally. Our growing relationship with SGS, evidenced by recently signed contracts, is excellent for PhotonAssay adoption. Having the world's biggest laboratory company advocating for our technology helps de-risk adoption by both small and large gold miners. (Dirk Treasure, CEO)
Q: Regarding the MMAP (Minimum Monthly Assay Payment), are the new contracts signed at similar levels to existing ones?
A: Yes, all our contracts adhere to the same metrics and economics, including a locked-in MMAP and the opportunity for additional assay charges. They are consistent with the other deals in our pipeline. (Dirk Treasure, CEO)
Q: How should we think about the deployment cadence and the weighting across the year?
A: Our goal is to align deployment cadence with manufacturing capacity, which is around 20 units per year. The four contracts signed post-period are intended for deployment within this financial year, indicating a positive deployment cadence. (Dirk Treasure, CEO)
Q: What are you seeing in terms of end-market dynamics and pipeline activity?
A: The industry is becoming more interesting, with the gold price attracting attention, which we expect to translate into increased exploration spend. Although we haven't seen a significant uptick in exploration spend yet, we are well-poised for when the industry turns. (Dirk Treasure, CEO)
Q: Can you provide more details on the financial results and future guidance?
A: For FY25, we are guiding revenue between $60 million to $70 million, indicating approximately 45% growth at the midpoint. EBITDA guidance is between $9 million to $19 million. Our strategy of clustering units in key mining regions helps control unit costs and drive EBITDA margins. (Dirk Treasure, CEO)
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
