McEwen Mining (MUX) 10 May 212021 Q1 Earnings call transcript

Hello, ladies and gentlemen. Welcome to McEwen Mining's Q1 2021 Operating and Financial Results Conference Call. Present from the company today are Rob McEwen, Chairman and Chief Owner; Anna Ladd-Kruger, Chief Financial Officer; Peter Mah, Chief Operating Officer; Steve McGibbon, Executive Vice President of Exploration. [Operator Instructions]. I will now turn the call over to Mr. Owner. Chief McEwen, Rob

great in Good from with and but Nevada release; cost evidenced a me now to both better months, But pinenes over program concern strong off been much for operator. our extended full; generating treasury everyone the in the are is doubling and four, the bring per financials; two, brutal than I'm today's mine still three, operations have hitting will with by us. going with price started five, the has agree that is terms much XXXX and as One, lives morning, you, last our press work our down; to welcome. cases. in do is of we improved XX gone everyone, qualification targets ounce silver certain our year momentum. our copper Thank results XXXX exploration gold production, have was our and

talk the be at session operations, financial Steve. point, yours. all and We a advance have and by also ways looking best to Anna, Mining, for we we Production, deposit and by inside company, I'd Anna have he'll McEwen to projects. Peter, At a aggressively she'll silver like about followed over this turn have our large Azules, to which QSource and copper to Los be we're of very followed -- the

Thank you, Rob, and morning, good everyone.

Just our results. to QX going a brief give of overview

charge prices factors $XX at as will Production production to revenue equivalent our ounces. in of were COO, Average This just more our which decrease year. shortly. our sales of or owned compares $XX per loss loss share last XXX% of $XX.XX Peter from in gold net QX XXX% million to Jose in last operated relates impairment San compared a our our improved and the realized million or per was in gold review $XX.X in MSC loss XX,XXX QX share. had XXXX. year. of to was $XX.XX. investment of under The lines $XX.X QX average reduced million performance an in detail million $X.XX We silver prices XXXX at Mah, Our net comparative from $XX realized mine of $X.XX Predominant a properties the from Gold We've million. quarter QX reported recorded net also revenues in from QX in Bar of

financings. Rob During to, our equity is the X treasury as we quarter, alluded completed full,

were million And was Canadian raise part $XX.X The Fox deposit, the was our Froome expenses. first one the development for in development of Ontario. Timmins, our of in specific funds specifically of Complex raised new

gross financing The for of $XX.X second was proceeds an million. equity

XXXX. fully for With of are of all these the completion now our funded programs raises,

was been on to received dividends assets current Fox of exploration resource million. ended our quarter addition In our million QX and focus from The a in San this, $X million with very interest in in program, $X million We've in mine. the busy QX. in We growing $XX the million assets, base. working positive we over capital invested $XX primary in with liquid $XX.X the Complex Jose

during Vice our on on as $X.X providing our program in and President well be the Executive will shortly. more and our Complex Fenix expansion McGibbon, as Fox new Exploration, QX, million Steve details of We invested PEA on Mexico. us he also Project exploration joined

looking as continue well our by as We our to and this our controlling expenditures margins explorer operating to year. G&A contracts cost manage reduce capital

also gain processes We implementing to streamline began management and systems efficiency. to further

as we our commercial QX. to throughout specifically pricing XXXX cost more free deposit continue improve in and performance financial our expect up towards ramp We to

not soon in QX. our to new further and COVID-XX possible release have sooner Given Further, will study Peter the to study, we're provide any the no turn the still of cost PEA the outbreaks create on Thank than mining in Operating industry. ongoing strains provide PEA update ongoing company The of firm production to an restrictions response I cross call the to a recent our variable event, costs this in as will will in the position over Officer. as late which now continue Chief Mah, and you. details, uncertainty ramp-up guidance. and for

located continues Thank strategically you, strong improve organically Anna, a turnaround production sourced morning cost, delivery, and and our to to show and signs operations The of discoveries from positive from pipeline good all. assets. our growing resources of

such met QX, Mexico in and the for in Gold update at the feasibility as the Mine studies the Nevada. During important milestones we Fenix Project Bar

XX% mine year. attributable equivalent costs XX,XXX José total GEO, per respectively, $XX.XX compared the was our the San milestone at At mined the is than cash to and from We delivered ore favorably Production and gold and our costs same for in important XXX,XXX mining and X,XXX QX, and planned. an also XXXX achieve All and production line the Total were in ounces as which XXXX. deposit, a ounces was higher to increase operations gold in progressing Froome where Argentina, mine ounces. through of expected first XX% expectations. $XX.XX reached with silver all period to sustaining results production last of the is currently, all-in

operators production. quarantines, due X,XXX resulted QX in limiting to from decreased produced in Moving pressure gold GEO, of U.S. per The lower available on decrease reflects cost GEOs the $XX.XX mining and ounces Production sustaining was total a by and weather X,XXX in cost XXXX. at Bar all-in mine respectively. gold all impacted Production to produced hampering mining the $XX.XX and winter in a Gold COVID and XX% availability cash equivalent QX

at local and is and more to They continue We Fox costs on disrupted potentially production the community PEA mine improved will resources ounce drilling company all the Complex, agreement begun altitude losses with and the in Fox residual of estimate $XX.XX project continued year the of situation exploration are towards the contractor at stacking up. are Argentina, At in work improve work deposits. exploration adding to low and majority estimated preliminary per expected March copper total expected the in aiming of advance PEA targeting by end from and At baseline flora, demonstration raw currently and gold continue drilling the to cost a GEO, of Cost proposed cost decrease. access X,XXX and ramp ounce plan An plan shared XXX,XXX of shown Old the to being and some developing Canada, finally, entrances sustaining throughput; which at cash studies at we was extend Fox improvement a are Ridge, progressive leveraging surface of than leaching. in which accelerate communities. execute in cost Black a mining GEOs for in to Complex Mine, under transitioning overwhelming Bar the progressed new company. a with QX ounces fauna, expected to Throughout Gallo the Gold existing Froome environmental to Gold X,XXX to as on the water by per equipment planned expected helped $XX.XX at engineering remainder expected has Bar as of feasibility production reached more QX ounces by equivalent for study and bankable improving adding mining. At El to In QX life deposit, initiatives Froome for the at synergies mining QX XX-year to Results and review authorities. where road. support by decrease prepared community, the efficiencies to produced more be be work members. required in the Operations commercial QX. are as for an all-in the quality and related profiles QX, Mexico, while Pick cost There ounces was the year, correspondingly we Production archeology resolve by produced higher with in Mining released and per and respectively. is include is were production, reduce mine we near and ramp-up with the the expansion QX. and potential the mine the plan estimate infrastructure. the a operational deposit we for underground planned gold are through the to of

alternatives. to the I President opportunities In will McGibbon, will or value-add turn to addition, technologies the identify released pulp with improve Vice sorting losses now to work Exploration. other Executive and of Steve of over call continue economics the

Thank you, Peter.

we raised other million $X drill, exploration exploration QX, $X invested million on and drilling exploration on we work. During

our principal a Recent X $X.X At operator, our X,XXX José, XXXX resource focused basis, exploration have of over is gold million on and been of existing growing encouraging, focus contribute and And vein grams result by With being per Escondida remain results adjacent million near-term grams from deposits the San to the silver Complex per the budget X meters. spent an effectively operations cost extending XXX% tonne production. QX. $XX exploration mine at including gold on in we to exploration to on base. -- with our XX.X Fox partner goal tonne generated the primary outstanding gold discovering

Gold model targets exploration the holes. million and oriented in X,XXX increasing circulation where potential stage property. exploration encouraging been see QX. are completed At programs, drilling mineralization, successfully share were meters and $X.X geological completed. data. to the XXXX program the we'll and funding which focused Complex density of areas. $X locally in meters Ridge from are core QX. further Canadian exploration and were the resource Exploration drill and used on Gold blocks Ridge, telcon delivered high Tonkin core oriented mineralization expenditures. resource average growing the areas mine following At targets Canada, reverse from an improved were near-mine exploration evaluations quarter, results QX of expand consists at during continuing Near-mine focus were phase Old the of to eligible new are further in work Bar the the in for of and oxide of in Early into the resource is extending at existing flow-through testing Bar spent budget on deposit QX in activities underway the during this resources metallurgical activities initiatives updated Fox confirmed received primarily grade the Drilling U.S.A., from reserve base. provide holes X,XXX Some X Ridge in drilling our ramped has North The neighboring on the has at which Exploration primary Fox being target Complex XX up Escondida program QX. focusing on defining a target. Escondida, estimate part Ridge million

the return at mineralization drilling XXXX, Black additional drilling. at in West depth. being body to is Underground mineralized multiple Fox QX, to to Mine high-grade During drilling Fox unconstrained was adjacent the in The were directions. mid-XXXX. follow body discovered continued Black In on completed where intercepts identify activities focused Stock encouraging exploration up mineralization remains ore

to outlined model to budget spent $X.X Stock needed to drill for press million area. density the potential that We to holes release August completed and or of XXXX. develop XX,XXX the surface zone Stock generate West property at XXX Stock X primary at exploration of As mile XX,XXX the Together produce million including the a a resource historical Stock XX facility. West. of questions. Complex, drill have total the pending, this important a Stock historic PEA Mine. mineralization about at four mineralized below test increase of exploration Main results, that at we XXX exploration of Stock for drilling Stock $X meters Main, and Stock contain we resource suggest expansion concludes at our these will resource QX, the and meters the processing is zone. a Stock Timmins visible completed of and West of continuing exploration was at will Service released West and with in of an portion X.X do contracted our gold. meters confirm maiden X our open from now with Stock the the some Stock morning, presentation, drills we'll at call XD QX, be been drills feet to That with A and Fox an initial West define East assays intercepts or estimate new the total Stock for focus have the update will since results In Initial to the the of

assessment and exploration to thank I Instructions]. year. their where -- of we the for [Operator more balance Peter this expect just to Steve of get want results throughout before and year can we But statements the we've are for

are have gold district land monetize Argentina, plans districts sensitive copper, price now in large major to that very we're the our Timmins right we're José and winning way in project. large at packages possible Nevada. have also silver in you The pursuing progressively silver we emerging It's inside a expansion We delivering Southern in Timmins San San operations, of the mine. mining, gold we when where copper for months, have an And X Azules where at to value it'd And the company ounces any alternatives and where XX through X to José that the in doubling Fenix Los in project, looking the released can. advance with of Mexico. million silver prices be mine end With of the we last indicated of we and category silver the operations the QX. copper look silver. And our and of Project

So decision the in would next the I months. -- and there expect few

So to now I'd Q&A. entertain your please open please. up Operator, questions, like

[Operator Instructions].

from first of H.C.W. from Heiko question Your the comes line Ihle

today In how ones some results regards still goal drilling your long words have you I strong it looks visible which mean, Stock for you. West, it contain mine, not quick the like the asset are in idea at Two several of have at to for take that It or pending holes, that of looks for results? will pending. Any your of for focus site of for more well. And year? that Stock matter, results else encountered you assays importantly, Bar over like remainder drilling changed have the respective West that these more some the anywhere results as any Gold

would to care answer Steve, and Peter Heiko's question? you

to that to or changed to we we've right being which I try now in we opportunities a it to that. the ultimately you haven't be somewhat. PEA. as With getting Yes, chime that time, seeing expect that mitigate constraints results Peter, pending, to are our the presented in? at results that making drill is driven be, and plan we're of that focus on working can And quick like that be not as over the by our are and general, results want chime stream will in in labs priorities, perhaps But there brought are the results to first would respect steady turnaround on time. we assay

Gibson That's Yes. would Jack I we Contact the and Complex. end Fox Main, which Heiko. an would concur XXX, West, existing Contact drilling to with Stock We're their north probably Jack, Stock Steve, XXX. Whiskey access Whiskey has Zones and use the decline Gibson. and

the was for all cases So the Gold in interpretations Over encouraging results, PEA. and geologic target. Very #X those plan. Ridge confirming Bar, promising, our business our the at were

then that drilling follow, we and follow-up one there then So do and and got the have targeting we'll underway And next and talk be there, targeting is results analysis to also Pick. some Gold drilling some after there. great continued Old Bar mine. The going of we're will

follow really results. to continuing encouraging plan and So the

Azules. that you're cash And just longer quick saying key using, clarification makes Obviously, all-in metrics costs sense. with sustaining and are a which you're that no

flow disclosable of how estimate helping the phase idea for the year? in longer you you're to assets? all-in to of the regards us how you disclosing sustaining there willing or long rest guidance to really relying can that a So come us disclosable any on to Or asset costs, site cash no disclose? anything another costs any more to from duration better. And this metric give this else. with would the cash Or be Is to

with what The is to of as asset. to probably this provide certainly decide next to some cost and to important That keep kind look that come costs I'm for So Thanks Heiko, happy you will do El Gallo as the months. is to to El [indiscernible], take question. we off-line Gallo We this respect in do of Anna. with well. strategically the couple

continue workforce that keeping. to We we're a have there

start operations. permitted there to are We our

do of with would care the of say formal So in a sort But being to the we're is on strategic El Gallo continue in we decision and much asset? the seeking I along breakeven until of maintenance. made by cash in terms pretty invest flow, terms company

Your Partners. Alliance question from next from Sekelsky of Jake Global line the comes

sort Just around on a quick from you staying stands plans I'm that? it in where to Or capital curious question standpoint. development Mexico, of thoughts Fenix. a move And with there? if have forward any just just allocation decision the your guys

Anna. Jake, it's

Jake...

Rob. ahead, Go

ahead. Go

Okay.

at again, So are, strategic moment, just we options. evaluating the

are of steps couple if I We on add will not a it next know further the if Rob, that of the you fund probably anything and we didn't come will asset to sooner. next add that? in terms on in decision what months, how to

covered, No, Anna. that's

You covered it well.

So we'll probably other than that's see that. something that event midyear a type

correct, That's Jake.

Black you region hub-and-spoke like And it's M&A you you have But of land online. Fox the the just switching guys think the sort then are Or do and coming over in opportunity Froome there region? the now? Timmins the there's additional with comfortable to in general, that in together, strategy coming with assets seems

Jake, currency solid our a think is looking we're stepping at on out. before until -- our looking stronger, base we it's building

of Joseph Your Partners. next question ROTH from Reagor the Capital from comes line

of from MSC a over back Or guys the quarter. holding the first in quarters this Was pandemic solely more extra being was was cash previous pretty cash? thing, dividend the -- Minera that maybe this the little some from So in significant there conservative m from when during quarter? kind Santa there

I can question. for answer the that question. Thanks

received, are bit both, you of a So it is right. the cash

it's so about So they surplus of a and of There in mix COVID. for that most light XXXX -- both. of cash there a held is

signal they're really this Certain it hold right to respect we respect And look year, for potentially will have to back $X but operations, is the happy situation with remain more order. with further of COVID. Argentina now there dividends in dependent on quite be on the million coming terms certainly things that there there of But are a the sort of dividend. received XXXX. in all rest is their like We dividend in to

for but Fair Bar. over you're decline? quite see is standpoint we specific assume guidance, should stacking the know the were tick gradual rates down. I assume switching not costs the and grades tick up plan best year, of elevated Okay. then Obviously, in to as come cash the giving Gold quarter. enough. And from remainder the gears a that cash a up it is I to modeling us costs

Yes Joe, Yes. this there. is Hello? right Peter. Yes, you're exactly

exactly right You're there.

We looking to and getting through the that work exploration including that about are We We're at last and through you working strip. talked heard ore opportunity ore earlier. releasing year. that stuff

the working we're feasibility towards the So feasibility. and beating

in And one, Nevada. on of Is been one you guys it do the Or to what From of like consider looking hearing, final I flagship selling? something would consider people a Gold you company? Okay. if operating then lot that could, assets a buy Bar. of we've kind there's

has price. asset Every

open where and think grow trend we're a suggestions, a is We in significantly. deposits as some there's property exploration on is always think don't projects a there. -- large. It's potential think just we Falcon is So there Nevada our there that our to And above to us. in but room major mines we loss

have of they that. sleep put to in a So number front

[Operator Instructions].

of Research. Very comes Tumazos Independent next Tumazos John John from the line Your from question

resolve how have a and dollars to directing resources, much to for Gold more extensions defined. on it's you mine of question the at be spend top the I PEA size processing uncertainties to entails and the How don't density Fox, upgrade to cuts Black when is certain would development congratulations have money Peter to a drill Steve, mill life shape study, to and Rob, understand it would the for Bar. holes, why I'm mine or that many feasibility layout Concerning well the very the the PEA many gold about any how stopes, precise the determine be plan?

was the X why Steve. that I John, and really already, to and identify sounds in things good what Yes, questions. start, big talking. PEA the analysis that. room we permitting, reason project and a did we're I'll district. challenge we all big a in you're a are the on it the quite think gap areas bring team could those and trade-offs the to order combining the It like And assess in what all

running flows So questions. in and all those the now cash we're right of the middle answering

Fox really come see in a through can PEA, of can't that did the XXX, to will At and recall identify obviously, XXX-meter early the And but track our cases, like clear I trying that we development pathway there area to out, So deposit, a we potentially, that's what to right Grey Gibson decline, calls like enough see there. the we're you if towards And but fast with then an lot sight to an was in to level. objective and if of production. West box, we and we if past drilling line project respond done, rate the up the we Stock and a answer. there's been again, above report accessing Grey has plan FS some

So be And PEA. lot that of one to do. there's from outputs more a the the will

much do narrow. so the QP you think Peter, drill McEwen more X-ounce Fox project, meter gold a the has or to X.X We bought let there's tightly, been a an another all often there's ounces. know How honorary there. merits reserve year-end of for the team. member innumerable Since was assays it Black over meter me property I'm reserves. XX,XXX since money calls way The try

Yes, I'll to that, I too. pass that can to add Steve,

very, confirm very Fox, we we Yes. order between the what drilling as a that significant and need to really meters say probably ore X get I somewhere expect that do very Black aware, centers some that to we guess, that nuggety. is able seize would I undertake be results. and to ore. is the can identify potential try initially put our nature gets the immediate drilling, that longer-term same we drill but which this on We're high-grade potential haven't would And reliably reserves. points, program at specific us, But satisfies require trying be final X to of and of time, a is density you'd with point. drilling nuggety them target into the of that areas property just to in And converting to to accessible more a that we access of but from really drill that we significant number the of him a will what amount kind overcome on at that

X X the an impressive That the certainly and of would define shape to goal. size It's meters is stopes.

Correct. the And I the concur with exploration Steve, their and potential backs. is and the Froome. connection way without Froome, production the that and we go moving carrying we there to pressure west we've work moved process like -- and can like the deeps we're of of about to on drilling team in production out flank, the needed

still we're and hopefully, coming So achievable. forward and that's be project, advancing better to understanding going with higher Stack a that minable shapes grades

the call no you. I turn at and Rob to time. questions over are back Mr. There McEwen, this further

you, to Thank the All The exploration of for successful business. joining and day. and movement taking loss coming Thank on Timmins, And our our operator. you. forward you, news best. Thank and of further it out everyone, very a call, PEA

today's concludes Thank participating. call. for This you conference

now may disconnect. You