Ann: June 2023 Quarterly Production Report, page-29

Another outstanding quarter imv.

Here's my summary comparison to previous quarters.

Iron ore shipments of 47.5 milliontonnes (mt) in Q1 FY23

Iron ore shipments of 49.4 milliontonnes (mt) in Q2 FY23

Iron ore shipments of 46.3 milliontonnes (mt) in Q3 FY23

Iron ore shipments of 48.9 milliontonnes (mt) in Q4 FY23

They hit their top end of FY23guidance at 192mt. With China re-opening post Covid I believe that could be one of the strong reasons why. Looking impressive to me.

Q3 FY23 - Average revenue ofUS$109/dry metric tonne (dmt), realising 87 per cent of the average Platts 62%CFR Index for the quarter.

Q4 FY23 - Average revenue of US$96/drymetric tonne (dmt) in Q4 FY23, realising 87 per cent of the average Platts 62%CFR Index for the quarter. But when averaged out for the year, average revenue hascome in at US$95/dmt in FY23.

Industry leading cost positionmaintained with a C1 cost of US$17.57/wet metric tonne (wmt) in Q4 FY23 and17.54/wmt in FY23.Note their FY23 guidance for C1 cost for hematite was US$18.00 - US$18.75/wmt. So C1 cost was at the lower end of the range at the guided exchange rate (AUD:USD 0.70). Excellent!

FY24 C1 cost guidance for Pilbarahematite is US$18.00 - US$19.00/wmt. Guidance is based on an assumed FY24average exchange rate of AUD:USD 0.68 and anticipates some increase in labourrates, as well as mine plan driven impacts.

Fortescue’s cash balance was US$4.0billion at 31 March 2023, unchanged from 31 December 2022. Net debt of US$2.1billion at 31 March 2023 unchanged, even after payment of the interim dividendof US$1.5 billion. Gross debt was unchanged at US$6.1 billion at 31 March 2023.

Q4 FY23 - Strong cashflowgeneration contributed to a cash balance of US$4.3 billion and net debt ofUS$1.0 billion at 30 June 2023, compared to net debt of US$2.1 billion at 31March 2023. Gross debt decreased to US$5.3 billion at 30 June 2023, from US$6.1billion at 31 March 2023 following early redemption of the US$750 million 2024Senior Unsecured Notes. Excellent!

I liked this point - FY24 guidancefor total shipments of 192 - 197mt, including approximately 7mt from Iron Bridge (100 percent basis) and C1 cost for Pilbara hematite of US$18.00 - US$19.00/wmt. IronBridge - ramp up to full production capacity of 22mt per annum is expected within 24 months. IronBridge’s FY24 operating expenditure excluding shipping and royalties isanticipated to be approximately US$400 million (Fortescue’s share).

FFI’s FY23 preliminary unauditedoperating expenditure was approximately US$440 million, exclusive ofexpenditure incurred on behalf of Fortescue Metals for decarbonisation.

Q3 FY23 - capital expenditure ofUS$681 million in the quarter.

Q4 FY23 - Total capital expenditureand investments for the quarter was US$967 million and for FY23 was US$3.2billion. Q3 FY23 total capital expenditure and investments was US$833 million.

New developments

Belinga Iron Ore Project in **on - firstore was mined, loaded on train and delivered to the Owendo Mineral Port inLibreville during the quarter. The first shipment from the port is expectedthis calendar year.

FFI – progressing well on manyfronts, with expansion plans, progression of studies, prototypes delivered andtesting underway. Acquired the Phoenix Hydrogen Hub in the United States withphase 1 underway. Holmaneset green hydrogen and green ammonia project in Norwaywas selected by the European Commission as a beneficiary of its CleanTechnology Fund.

FY24 guidance

Iron ore shipments of 192 - 197mt, whichwill include approximately 7mt for Iron Bridge (100 per cent basis)

C1 cost for Pilbara hematite ofUS$18.00 - US$19.00/wmt

Capital expenditure (excluding FFI)of US$2.8 - US$3.2 billion

Which includes:

Sustaining and hub development:US$1.9 - US$2.1 billion

Exploration and studies: US$300million

Iron Ore Projects (Iron Bridge andBelinga): US$300 million

Decarbonisation: US$300 - US$500million

FFI operating expenditure of US$400 -US$500 million and capital expenditure and investments of approximately US$300million. Guidance is based on an assumed FY24 average exchange rate of AUD:USD0.68.

Tony