Great Panther Mining Limited (GPLDF) 4 Nov 212021 Q3 Earnings call transcript

Thank you for standing by. This is the conference operator. Welcome to Great Panther Mining Third Quarter 2021 Financial Results Conference Call.

As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. Instructions]. [Operator like President, conference Investor now Grant to turn Vice Leydier, Relations. to would over the Fiona I Please go ahead.

call Thank you, you our Thank Fiona Grant Operator. Good morning, for everyone. participating I'm Leydier. today. in

that we we during presentation. please Before will the begin, making forward-looking be statements note

All should non-GAAP results future measures, in reconciliations in are differ that XXXX. definitions amounts events commentary also nine financial the actual today. months included unless ended those this MD&A and and expressed otherwise noted for the presentation The cautioned XX, Company's refers be in may three You and statements and September and from U.S. noted. dollar to the associated MD&A are various dollars, that

cautionary presentation. be of statements the end For at can to during reference, call, Detailed AISC found the the refers costs. all-in sustaining

is filed conference and today's on refer this for please and accompanying release which EDGAR. slides yesterday our This and financial conference available will the presentation the and website accompanying on Replay being XXXX recorded our were later and be SEDAR today. issued QX MD&A replay website. will and information webcast call, For statements available call been financial on be the posted and results news to call have

morning, this Officer; Sandra Daycock, and Henderson, we Chief call the President On Financial Officer. Operating Fernando Rob have and CEO; Cornejo, Chief

a some XXXX, We guidance the the in dialing operations. some third provide some On today's today. spend revised to walk clear our preliminary our we company's of everyone call in well through guidance and have and outlook. quarter production Thank for you, forward-looking address to picture financial you for discussing and Fiona, will challenges you results give time thank as you plan XXXX we our as

in high opportunity gears to continue third Our or we the Tucano pits a high the of the plus expiration source has from a value and Tucano Tucano pit pushback the a the to In multiple long-term affords Mexico, second Gold that lower issues and value fleet lead the At where and tonnage other underground regional was South package underpins is geological labor mine the poor UCS region shift implementation maintenance to undoubtedly perspective Panther grade reserves. resulting long-term lead targets. Great production tonnage related quarter. in in Brazil even availability in invest and delays completion shareholders. the us challenging shortages The of mine optionality of of QX Urucum the temporary to mined. or delay exists as The open a also supply Central laws staff and for for to mine, land in Mine new in potential activities.

the were estimated. production and as consolidated included ounces, mine result, than XX,XXX which ounces GMC our production metal mined at a In tonnages lower was gold from addition historically ounces of areas available and XX,XXX XXX,XXX actual silver. primarily was And equivalent of gold

Urucum to resulting this million. stock and metals North a third operating it in loss unit $XX volumes lower mine quarter $X.X a reported metal loss supplemented average the costs. of net our and into low prices grade the was a in million mined and quarter. grades mill. We cash of resulted were all the in UCS in increase in we equivalents. ore Therefore, Lower the pit continue revenue expected by activities the As quarter, with And lower an million, $XX.X the in ended power sales from for pushback in $XX.X of second and cash resulted million, was

been related was of to put Mine processing maintenance care In the to made of mid-October Cata and ore. November. difficult exploring subsequent higher review expand third-party processing And turn We plant Tucano's San decision following Southern uncertainty of manage this intend had the the a storage flow the our quarter operate pits, we this optimize mine, the to remediation to be mining required we're advised the and done the the UCS plan alternative of the including improve we're action Ignacio ongoing tailings our We following mine monitoring in the of of year. remediation end grade rainy safety and postpone at on events committee Limited be required so cash Turning to mid-XXXX, attention to of our given strong the permitting portion that at the plant. for to next season. focus work to now more And work Guanajuato to effectively mine pit. necessary and by arrangements authorized to that safeguard additional ore This geotechnical now Cata facilities production would the decided for course can UCS factors. to end. the we've

until there is the UCS year. this It's many that it ounces end important just not of the note to So The one at pits of growth future Tucano. of relatively mine. is we the continue and low of mining driver contained will are for

mine adapt TAP seven a to use AB, our to at Tucano how that current make the we'll weighted including mine TAP we of be best have half our fleet production of pits UCS, which We're the reserves. will the how resources majority from able doing the our of designs the production soon at work much plan, of We can AB to indicates the back Initial accounts to year. total to be to next deploy to XXXX. engineering and how looking optimize

in production see TAP to expected will bring QX, the year. how be approval to of have necessary come we're into work production North half roughly And half the that of stripping can complete could reserves. while onstream where as on stripping QX to AB production, of accelerate as first to project plans In first accelerated plan Urucum AB. the ounces C, sooner. next in underground looking onstream we XXXX, our continue we TAP bring invest at and TAP With the North from we Urucum The XXX,XXX early

from future regional by continue production We to also continued Tucano plan to secure a investing exploration.

Tucano exploration planned was is year. the roughly order same it in of budget this XXXX Our to magnitude for as be

be of when undertaking of Chief our work Officer discuss majority we'll I'll half we stronger our to it from the second XXXX, Fernando cash operating flow. operations. expect to Cornejo, However, the this in pass over now Operating results

morning, everyone. Rob, Thank you, and good

Central ounces mostly production also by to affected slow availability, on such levels. related was Tucano. fleet in pits, ton. restrictions per mining compared at low in other Urucum pit, XX.X% than gold AB South Urucum quarter for lower was in fleet Focusing availability X.XX the geotechnical consequence gold movement, a ounce higher first grams was XXXX. to rates recovery which as production TAP Low Average of rates XX,XXX affected QX ounces XX,XXX Gold rate the was mine and The decreasing as North. anticipated low to due and

quarter, with QX Urucum recoveries ASIC lower the pits. the During per increased throughput, from supplemented ounce $X,XXX high North Despite grade resulted $X,XXX one Urucum ore with average and plant South stockpiles the and fresh in lower compared the in the Central metal lower ounce, of XXXX. an an per grades from feed

until pit. for pushback the will has safe overall the of required activities This an of As and a additional committee continue from Southern The Rob to conditions also At stable monitory. the improve the mining as north pit, same site company mentioned of advised in authorized which workers pushback visit portion the safety the after decided by defer to the committee December. mining end our that portion Tucano the the be earlier, remains of evaluation the after to per ground company mid-XXXX, and ensure in central down additional pit in factors geotechnical to time, activities the rainy ramp season. of rate situation right the Southern the of to portion

we that a do runs more. of part reference, season in know once provided six know months. the and not information yet Brazil will more analysis the typically Therefore modeling As ongoing. still for about be we this of The January is geotechnical size from pushback rainy

very underground. saw late underground completed program, total the QX. which in we continued in XXXX, front, in QX. started results has exploration the XX,XXX of promising The drilling On both throughout drilling open the some and meters of a We pits

in per year ounce studies to development the fast-tracking this Urucum are XX,XXX project ore support to mine; The open decision XXXX. has to plan for late startup underground extract North We a the XX,XXX pit. as current below ambition from

potential continuity which kilometer sampling land last and mineralization. of nearly program campaign the over package, C, onto extensive demonstrated Moving year. of In in with and started expansion this pit this the to regards regional drilling high were defined corridors, year, our square TAP we've soil mapping X,XXX exploration has exploration resource a conducted replacement

and laws per gold and which grades. that were XX% be per first Mutum radius within kilometer shortages produced, defined with led to gold being on are targets average was trend XX averaging of X.X of silver mine. regional This XXXX. equivalent areas. into within due with is grams silver X.XX The recoveries throughput Mexico, labor targets by the drill production in XXX to Drill to ton. program month kilometer processed geochemistry. a decreased long ounces exploration and grams a estimated was to plant. identification were Tucano were continue could related by total being grades new corridors. than trend. targets has lower element and mined At received, are exploration and mainly paired results Mexico, average of and priority ton. focuses mine also the that was the Production exploration results Total The throughput methods in lower this by planned labor historically from XX.X% recoveries have As high shown gold the these Complex eight Guanajuato around testing a QX multi of authentic evaluated lower The soil the of fast-tracking continuous XXX,XXX the silver at implementation commence Mutum with lower exploited is of XX.X% silver grades around elevated

compared QX this XXXX. $XX.X production, $XX.X the was a ounce silver AISC lower result to per the As of of in

lower in noted Topia, earlier, The difficult was lead and zinc. and implementation QX ton and in silver put X,XXX As a average of care Peru, focusing production were of the meter per ounces, grams lead XX.X% processing per lower X.XX completed rates July, Sandra in on to total along this XX% of at Daycock, around silver, zinc. labor end the has silver, was the October, year. end program program Mine to month. and XXX,XXX results. to Coricancha, with mostly of throughput plant Constancia discuss call drill financial turn related made gold, Cata our on drilling byproducts grades Wellington decision to and base. decrease to this was will the XXX lower of Rob At XX.X% Metal new in in late GMC. by the with related At similar a Guanajuato Mexico, CFO the recoveries The throughput for I very in were to equivalent the be Escondida, grades ton now received company grams gold, finalized the The gold. and laws to commenced maintenance

G&A decrease $XX.XX of Fernando. gold a sold. silver. ounce XX% metal to in per $XX.X and resulted per $X,XXX items mine in per mine volumes in for primarily million, non-cash Consolidated lower ounce $X,XXX you, sold which earnings lower third compared lower grades was metals the versus million to Thank sales gold ounce loss lower due with QX The production cost gold In before and to for of operating prices was and over quarter, operating XXXX was attributed million QX $XX.X $X.X corporate $X,XXX recoveries, ounce increase AISC revenue excluding due of per an XXXX.

execute the was cash Adjusted XXXX, million, negative As EBITDA mining cash is primarily negative cash of Urucum costs flow QX of note was with XXXX. million result activities $XX.X in million This million, from gold sold, ounces before Please net in to that remainder all from the will of equivalents Xst, $X.X for cash changes for current ounce compared described of month been the company's forward. million Tucano working to $XX.X previously. underpin information, contain as position lower gold and QX ended with $XX to operating decrease $X.X facility a news range compared will Due and open with from objectives. net a to the the higher XXX,XXX compared and The the the with stemming the in release income seized was of as XXXX provided increased higher XX,XXX costs in and in note this to working loss and including for guidance inconsistency $XX $XX.X market be QX guidance reported per quarter sold. to million, of realized AISC capital for due million, guidance factors there pits going costs ranging $XX.X capitalization We $X,XXX with in $XX.X capital working at the and net Asahi expensed XXXX life. pushback text the gold the million does the $X.X of credit correct million XX,XXX July of prices cash ounces and Tucano silver borrowings. ounces XXXX. those XX,XXX non-cash and of QX XX,XXX for and production lower equivalent pits to Tucano, gold pit consolidated table as to XX,XXX mining company was facilities costs, Please and new to we production production the have a of gold gold revised Samsung Consolidated secured XXXX ounces. we growth on the MD&A. although range an XX the established that our We has guidance disruptions to $X,XXX that company's capital stated our in between million

up accelerates preliminary production Tucano, AB year Looking approximately in ounces ore. to be the forward plans which of the XXXX from of XX% our mine include half year, second when of would the to next pit for TAP mining delivered of XXX,XXX

of cognizant up growth we reviewing head the we are the number New for to are we avenues to potential need manage judiciously of XXXX, and the capital into set As Year. a ourselves in

will year development the cash flow have strong that half, the we and costs capital We necessary managing in first in accordingly. of the half are underpin second

costs programs. formal remarks. be We global initiatives, XXXX. controllable to I we managing executing will expect you. turn for now we healthy cost Overall, for back are in That's prioritizing all on Thank capital to operator the cutting also it production and have Q&A.

you. Thank

We session. Instructions]. [Operator will now the begin question-and-answer

Alliance The Partners. with Global ahead. Please first question comes from go Sekelsky Jake

Hey Rob and questions. team, thanks my for taking

Jake. Hello

with and Starting moving you the thought some transitioning been pits? year. given of to the middle on provide just from and deferring to about there? of additional pushback remaining to know UCS I you of next other number I activities able the UCS Are fully any to away the wondering any guess talked I'm ounces there's color if altogether on

there's a Certainly left in production breakout. detailed analysis of give about our we the give six pits we XX-XXX, some But in what do don't of probably look like UCS. months and

the XX,XXX So in of order ounces.

UCS, high So it's grades.

it it's for AB Tucano. the mining over has are not We XXX,XXX TAP future ounces of right now. instance. a But

to from on gold and from do that we move need us. the UCS extracting other multiple So to the are available start pits

early, a the that do we in but to costs might being that's year? year. I and Okay, on first production in then of it's And with going half of helpful. development obviously, have any bit might It there next sort stripping see half majority the be in indications AB, next that guys of for the TAP mean, the second count you

can Yes, the maybe AB but we're still stripping requirements. budgets, more Fernando and color give a nature of on getting our TAP bit you

of Absolutely. material TAP And to the easy the the it's conventionally as mining crushing much, AB portion digging. it's soft free plant super almost is mining, a closer much known because plant.

we're cheaper terms So, than is will that obviously away of from the much X.X in AB costs, which anticipating kilometers Urucum, plant. located be

study on know the missed may a you we or later guys front? then, decision Should have this there you a Okay, might still formal so? next I lastly, it expect mentioned if of quarter on helpful. over on development you make scenario, the that's I just kind underground in and I the And played apologize. year that

Yes.

to we're of doing close study higher extend that we to confirm work on it the portion. as continuing continuity and So We're to down grade the speak.

the it's year. go is to next spend the So formation pit. the then capital, for in yes, of that to out the we the just to would iron the million. from North approval bottom right of vertical getting on million middle in that result And would order the mineralization look at continues $XX board banded $XX of which Urucum We

into the be mineralization quickly. we'd So pretty

So, as into gold plant early if see could next a we coming the we get year. the of decision as QX end

from with comes question Ihle Heiko next The go Wainwright. H.C. ahead. Please

tailing the arrangements currently alternative costs for some With permit and terms color clarity the with you're just that trucking into? looking at can provide you more associate about CONAGUA the the distances,

Yes.

as So, our facility know, you is reaching tailings capacity.

and neighboring capacity have. So our at they we're permit indicated to have for they mines looking without a they our if see two mill,

next the Horcon right and San distance [indiscernible] door is trucking So, El is short. Ignacio very to the mine

side in other trucking the mine, town, the is the order of the On kilometers. distance Cubo XX of El

to now. a that an something And established we're it's our trucking San bit We're the Ignacio it's plant. been doing right So Cata ore it's process. --

So we're agreement. a good our San pretty some has grades mines that and neighboring we can processing to with agreements ore confident for come Ignacio

the Okay. average first the of for loud pretty XX% issues the Tucano to the that assume mine for all Building a how keep the the also, out second constant at or and of we QX XXX,XXX be to model quarter And figure track out going the you're actually have we XXXX second should of less but half second that AB up all again and faced the is And is to is we're forward all extrapolating of could yes, on previously ounces this that that the model of it before just out want good you've half, done? ramp second gradual jumps your the With just thereafter? we answer given to the just the model I sort year given In to back half. XX,XXX up half that we then total, looking check least is, this. in more questions TAP same or this double an per for said on is year. two thinking full-year, here I outlook as for next half expect although

Yes, very good question.

TAP So we're phase been that's now. pretty the pushback -- mined, the currently on pit a it's AB, right a doing next previously big so

and it to So AB, and in a QX. steady and gold from indeed get into XXXX. we in does on accelerates release QX QX occur QX of production and but on get that We do do some release TAP carries

that open yes, do AB -- that's the what and So remove before that's looking or ounce at into material producer we Tucano waste benches, and we're the soft we've is are XXX,XXX get see mill. that got we're we into looking a we to released But what bunch a next into year pit at year the get a TAP gold of richer XXXX. which

into XXXX. So, AB QX it's then into is ramp yes, TAP up sustained steady a and

The Reagor comes Capital question from ahead. ROTH next Please Joseph with Partners. go

questions. taking thanks guys, Hi for the

can on questions, Following a a Heiko's you XX expect basis or if bit from agreements? on do of of now, sign one million saying off-take agreements a these GMC, throughput one we what

going to mills contingent be receive. it's on, obviously It's what's the neighboring can

I San our to now think, the production the mine contributor is at GMC. right main Ignacio

continue. much mine we in The expect that the ore mill would not last has this So year. to provided to Guanajuato

year GMCs San production been from has this So Ignacio. predominantly

still we year, the of that obviously to hope that's So on ability agreement, TBD. that level, purchasing dependent would old the continue next

another guy's then of on kind some questions from We're Okay, fair in production year? to capital cash fund first you're equity, had you next just something? form model or some preference forward the facility of flow do going Tucano. additional following of do just the the kind your everything debt half think in bit And this given of would on gold if And out trying sale, other low need of order to a you rates be to to enough. the standpoint, a

obviously got alternatives more color at us, in I cash, and some in some now, financing looking maybe and think our give $XX to we've on Sandra she can balance sheet right debt $XX is that. million million

think which yes, have mean, recently to supplement we all on capital we reestablished can our look as looking million We're we use at hand recently, $XX I I'd working ATM to our facility, say options. And needs. I cash we

We But point on haven't at a of number don't future financing. we preference question. we a have exploring. made so a have opportunities But for to your any do answer this decision

with opportunity project then Okay. not neighboring in up, potential Tucano the lot also that bring the kind the any of pits, to a And a away accelerate then, of in UCS? from bigger there's and movement picture the your is Is region. problem existing only to in underground the but there

big, kilometers. Tucano our the XX kilometers is -- it's by Yes, at tenement XX

massive, that's a it's us, To iron south being reactivated. getting massive have an So area. mine at ore of the do looking we

years. drill I might again iron old in the But So anomalies to ore now attention is region. our mine production we a on come that Greenstone look right have the the think to in few

or So targets. prospective the as of all we're four the have highest we've mine; very We've three speak. mill. the of two they're of priority soil high we we that trucking distance And to identified done north Mutum identified kilometer as we've others, drilling within sampling, XXX project, the over and

do is priority. So the potential, is high underground have to district the does that, we and also region. The need this a into course get thinking additional

the got again, this pits, those we're iron as we've underground underground hard pushing is on underground, so and identified well. vertical and formation have, we've the our a of do below to Urucum all North, at one. So examine opportunities But banded we that got

Matthew question Fitzgerald. from ahead. comes with next O'Keefe [Operator The go Cantor Please Instructions].

Thanks, my call. operator. Thanks for taking

TAP is year. provider out understand get big expecting to and of grades you so Just I now going several AB? back of much pits are How of what -- AB kind various from cost What's to the sourced a and pits. next you've question on from there the you of seems deck TAP got your coming kind here pushback to the be be Tucano, to so

is TAP grade. X.X The and runs the around it Urucum right Yes, TAP ton. grams at highest AB highest grade South, second on AB about a is next have our Central now of is kind highest we

some on In material, Fernando, quantity got you of terms that? color

Yes, absolutely.

tons AB X next we ore. we're around For to from million as million year, X into drilling anticipating X coming start

it's four this taking months done. to get around that is why five to stripping So

And pretty was the was there? stripping the soft what Okay. it cost You've material. of mentioned

material, rates ton. we per softer it's now probably So the manage is B$XX so right with below

know move. times don't going I you're many to how Okay,

like, of I'm or just kind understand invested kind it. here to into to here money trying So what has of to get capitalized be

That's we to what I to we said can tons or million X million strip X -- between probably that need

Okay. I see. I see.

Okay. X to X, okay.

Apologies.

No, that's fine. Excuse me.

Okay, great. of And from then so -- to majority like that's not source [indiscernible] is from It the UCS sounds be rate. still that but -- some other going you're taking is your yes. and sole pits

live stripping North with We're do South still; late next And from the in in coming TAP we basically moving And we maybe in to June QX ore scheduling Urucum parallel, start going C year. are we one. have ourselves QX. Central and Urucum by will

Okay.

to you like I the at it's for heavily for Okay. year, weighted Tucano. half. second Obviously, next And guidance say when the look

X.XX grades to produced grams So we does that suggest I it at this saw similar to like, we're in quarter that was Then the this think looking lower ton X.XX being per half. in mill. first the

so is to half. And largely in stockpile grades also does lower think to seeing first suggest similar we're going be that I your the done?

will grades continue lower In QX. in

of of stockpiles, the we're Central to because mining, on that stockpile going a some a which help maybe we're are from Urucum starting still those. the of yes, in start of into move terms and preserve we improving the TAP little QX. QX coming initial North. QX, southern and are pit As to But is one But C portion the run they in there's South for bit some is going to to portion us lower

Okay.

more then just And Thanks. your one patience. for question. can Thanks ask Okay. I if

will On drilling the we going do get going when year. resource sort kind granularity and you resource update? I of we normally update we Are expect on, and here of -- a when been pit-by-pit just of mining type see we several the been sort do what to lot a we will that when of over of should we've expect update to or there's kind but global to front, exploration that, pits so forget a lot number?

early a to next -- similar we very -- probably update ago. be will the year update and going happen the one year we The going released to it's to

So it right currently But come year. update an the does analysis going of to the it's we next now. out give pits. probably all in All yes, says details for what early it'll be have

it some should this to done results correct. include extensive But the Right. the of from year you've drilling

yes. Absolutely,

This I would over like for question-and-answer Rob concludes the the conference turn remarks. any to back session. Henderson closing to

our able difficult from to Thank to numerous and into We Operator. know other year design been mine a and it's of order fortunate to you, we're in adapt TAP be to production resequencing opportunities. pits Tucano underground the our gold

I moving We're deploying of value in the joined prudent about a preserving result navigate gold capital back-end fully and It's therefore bloom, we have initiatives that's We total a price I be and year. weighted. securing our financing. in of strength the to globe are forward. in pressures resources that gold expecting will we be spending to all first number And future. believe price, we through why of should a are across solid good and Panther and year stakeholders. creation why XXXX from I to inflationary for half Great a through believe just a gold I production which the am leveraged the the given have perspective, efficiently the that production doing And capital

Great next at forward to for your of On of into you factor behalf integral you a progress district gold thank part everyone here your that sharing an acquisitions strategy Thank quarter. grow us intermediate package execute upside significant look large and differentiating the offers support you the with the producer. team our our in and with today. a time sale have potential, We Panther, for to we on to have we with an our objectives growth

today's conference concludes This call.

You you may Thank pleasant a disconnect your lines. and for have participating day.