TMC the metals co., Inc. Q4 FY2024 earnings call

• The company emphasizes the need for critical metals in the next 30 years and sees deep-sea nodules as a viable source with lower impact.
• Milestones achieved include resource definition of 1.6 billion tons of nodules, first integrated collection system test since 1970s, successful processing into alloys, and multiple offshore research campaigns.
• Issues with ISA's delay in adopting mining code, with potential for continued delay in 2025.
• Announcement of U.S. subsidiary submitting applications in Q2 2025 to move into commercial production via U.S. regulatory regime (DSHMRA).
• Comparison of U.S. and ISA regulatory frameworks, with U.S. having a more attractive path due to existing legal framework and political will.
• Extensive environmental impact data gathered, showing recovery of ecosystems from disturbances, and efforts to minimize environmental footprint of collector vehicles.
• Financial results for Q4 2024: net loss of $16.1 million, exploration/evaluation expenses decreased but offset by increased share-based compensation, and liquidity details including cash and borrowing capacity.

No specific product segment financial performance discussed in detail. The transcript focuses more on the company's strategic and regulatory aspects rather than breaking down financials by product segments.

• Plan to submit applications to U.S. regulator (NOAA) in Q2 2025 for commercial production via DSHMRA.
• Expectation of regulatory certainty through the U.S. path as a better chance of success.
• Ongoing work on economic study and environmental impact statement, with the economic study still expected to be wrapped up in advance of U.S. applications.
• Commitment to remaining compliant with ISA contract requirements for NORI and TAMO areas even with U.S. application efforts.

• ISA's continued delay in adopting mining code, leading to regulatory uncertainty.
• Geopolitical factors such as China's activity in deep-sea mining and its potential impact on the industry.
• Uncertainty regarding the overlap or separation of licenses under DSHMRA and ISA frameworks.

Q: How does the DSHMRA application relate to existing licenses under UNCLOS with supporting sponsor states?

A: Gerard Barron explains the concept of freedom of the high seas and that the U.S. has not joined UNCLOS but has its own legal framework (DSHMRA), and the application will build on existing work with sponsoring states.

Q: Is the NOAA process a complete shift or secondary avenue alongside ISA process?

A: Craig Shesky states it's a new advantageous path viewed as the best chance of success, not a door closing but an incremental path forward.

Q: What about the environmental impact study timeline and application area for U.S. license?

A: Gerard Barron mentions environmental writing is at full speed, and the application area will be clarified in consultations with sponsoring states, with potential for overlap under DSHMRA laws.

Q: Why was the contract with a third sponsor state terminated?

A: Gerard Barron states it was due to prioritizing resources for NORI and TAMO blocks, which have more promising grades and require focused spending.

Q: Outlook for service business and revenue/profits?

A: Gerard Barron mentions interest in service business but team is focused on completing U.S. applications currently, with potential for services opportunities later.