Avino Silver & Gold Mines (ASM) 13 May 212021 Q1 Earnings call transcript

Thank you for standing by. This is the conference operator. Welcome to the Avino Silver & Gold Mines First Quarter 2021 Conference Call and Webcast. [Operator Instructions]. I would now like to turn the conference over to Jennifer North, Manager of Investor Relations. ahead. go Please

Good Silver operator. Results and to welcome Call Thank Gold morning, Mines Avino & Webcast. Financial Ltd. the and you, everyone, QX Conference XXXX

CEO, have On today, Chief Services, Operating and Officer, the Peter David Rodriguez; our Wolfin; Carlos VP, company's Nathan the Harte; our we President our call Officer, Latta. Financial Chief and Technical

securities may Before laws. meaning call by this made today we on the get started, within management please include team note of information that applicable certain statements forward-looking the

subject to Forward-looking unknown expressed uncertainties as statements law. forward-looking different obligation are intend such and statements to cause other and required information not risks, by or applicable does by those to and any known to may forward-looking does that update the than company assume than statements. by implied such other be factors or actual The results materially not

refer today. For like call the the later Avino's and be website. call Replay recorded be available accompanying this CEO, in more our you. yesterday's and is Wolfin. information, I note our of we detailed the this cautionary will conference and presentation now slides remind accompanying release the replay to everyone, date. this on you webcast conference on for available Thank will David? I will call presentation over call or turn being to and press information to would David President

Avino's Results QX Good Financial Call to Jen. Webcast. and joining XXXX welcome Thanks us. Thanks, morning, everyone, and Conference for

we the of XXXX operating for begin, the and our today's statements performance on QX quarter website. and MD&A cover than financial unless operational we the please questions. are will full highlights more Please all call, available we shutdowns. dollars and it note our financial year first are first faced then and plans Before now On XXXX, pandemic our the up that hard open for and since forced stated the noted. with has were It's to in been that a we U.S. note otherwise believe figures it will that

our to year-end previous Mexico, during quickly management the to at surrounding communities. special As Rodriguez, like team quarter critical I thank I safety would Carlos out of call, mine carried by tasks a adapted and who led mentioned ensure our employees the and you to in the say and

addition, strike I In to patience to and appreciation to October while the for during we the July support XXXX. due shutdown my at would experienced and last lasted year like shutdowns from temporary our to the extend the to strike The XX-week their COVID-XX temporary mine. due shareholders

result in Mexico Mexico, City as as declined the significantly ounces hit before with months strict of lines of silver COVID-XX XXXX number As to with suspended of in the ratify was Metals interrupted as health year partners is authority labor committed and resuming is as Focus. possible. XXX to under agreement. by Global last production towards restarting production most diligently a guidelines. X.X% reported million company projects company protocols, COVID-XX and office to a by operations in for mining in The operations its Mining soon remains due working closed the general,

to of estimates However, dropping to XX% X.X% global According $X XXX $X.X at million production to XXXX, strongly fell an the to to pre-COVID increase with expected billion. compared is in rebound Chamber ounces. sector-wide estimated from Mexico, billion investment

million to $X quarter, the million. announcing rebound our million, million from projects many and we for the goes $X between XXXX, investments in $X $XX capital for expenditures an also exploration companies Mexico. during increased across first with Avino, announced a and in increase set However, budget is industry as in to up This

workers Additionally, mine site. experienced has at hiring begun for

a definitely closer moving recommencement of operational are activities. to We

labor and place. including that ensure to all we properly health Our is in goal reopen guidelines, with

of El moving the dry forward construction. of the property stage the and continued drill on the in Avino mineralized Also new land to confirm and privately a veins. meters the were in final is storage with and objectives the is zones Trompo continuity locating top QX, tailings focus TSF quarter, in X,XXX quarter, Santiago drilled stack to owned At which within production of the end permitted at is we proposed a #X, prior area. program Avino During mineralization XXXX remains the facility, with current commencing currently ET

based throughput will should to dry environmental high an mill tailings completed be by during project its to chose and for tailings. from of stack XXXX, additional sources significantly now add on capacity stability QX this expect content. reduces This safety rate. with its extract it safety recycling need and current We water the We removed local the years tailing X water the and solid the economic from XX improves and advantages

environmental In in addition, -- footprint. smaller it results less requires land, small in in turn a which

partnership an the in contribute Avino and Durango continuity in a mine and business the surrounding been X to pleased under of to the initiatives help the proactive of that principles to hired Durango social ESG between ESG have announce people we Avino sustaining operational Over recently just has responsibility. developing of We're the the drive manager forward and years, and communities the site.

town. for roads We to have on recommenced site supported by we cemetery. needed. our San mine not ESG with to Jose to communities de have though bags the community cement quarter, supportive loaning town access fix and a Even many tailings, expand information when fuel the hand safety still the Avino we provided help helped paying dozer, multiple CAT including operator the will up lend surrounding again Avino of the the town that the new the in operations, of ways, the follow know dry in manager. stack During Provided and the we'll of time

the source addition, of provide will the and fully once only rapid again, the employment to employment tests steady good and of And of communities. local mine, health are the operational The Avino the the and expected to is nearby activities received have to of Many Avino significant the PPE work workforce. people of our restart area. in communities production governments. the communities. to Durango we we to and at In are benefits is local for stimulus back direct has ensure full of the state and the provide people support and hundreds in we economic keen safety get

drive, from X. silver be role Gold Not in X.X% expect first have During been growth is a when up sitting was XXXX. worth global propelled of with the shine. and going X, briefly March forward. to technology per our this now that It global we anticipated a as economy: XX and copper closing was of above on and overlooked pound. to price rapid share to is $X,XXX X.XX of rebounds we copper level. push certainly it's to mine February quarter, million an low X economy volatile, Coincidentally, price of production. of price contribution metals at year high continued a $XX.XX certainly China, on -- first the a in that volume day and gold to with our propelled full in will is copper. low slightly prices $X.XX play U.S. the that of prices weaker a With the low squeeze U.S.A., least inventories in day. green moving a This shareholders of strong economy. to the XXX fact for demand, copper quarter, of green $XX.XX new March by The currently vaccination and has both compared on activity, tear $X.XX the per touch low steadily clean of being USD in the slow The silver be Avino to staying demand to and X/X bit from metal of revenue gold $XX We on benefit the upward energy high a rollout of transition will of towards $XX.XX a mentioning $XX.XX and range the makes be pound, the on silver on benefit legislated Last range price believe a around dollar. Avino the the high XX in The key we definitely the range was I wanted February. silver on will on move will needed, clean and on a to on silver squeeze. industrial January decrease

will up traders new the and the and power also drove silver media and investors price check to the trading to presentations base. social that out forward all news website We have now Harte, diversity and our from encourage information. to increasing gained Chief mining We of public growing present of look the Avino's results and frenzy. our new demand We XXXX. stocks ask created often Officer, silver the shareholders Financial term a long of I these QX Nathan for and Reddit for releases, the our financial shareholder

call, It's has us would like to the be pleasure everyone David. and today. our joined on viewing welcome I you, is who Thank to my and presentation

production strongest financial said As you Avino can in mine. were that, at the impacted operating XX-year a the lack position Avino's by are results Having of imagine, we Avino's now existence. in

was the which $XX cash quarter year. million, compared beginning capital year, the which the over represents the quarter represents of was increase million to of end XXX% the $XX at million $XX an million position $XX the compared to at end of of increase at Working Our at beginning XXX%.

This debt a beginning reduction plans QX, our up to further by during XXXX debt with liabilities since debt reduce continued quarter. total million. the $X having brings to the $XXX,XXX during We of first lowered

to QX equipment to report to forward. leases and maintain expect financial flexibility the moving debt-free be by payables end which XXXX, significant other We happy of are we Avino than of allows that

from continuing includes for of losses $XXX,XXX to compared relating which losses in losses $XXX,XXX over up after adjusted during settlement equivalent XXXX During generated renewal Any the as from were invoices of QX, and revenues were and as proceeds result million share of of XXXX which care in quarter, operations million such, for of depreciation Avino and of Adjusted expenditures $XXX,XXX. and concentrate net ounces silver compared QX quarter, mine Capital were and or losses which reported quarter. taxes, the the of taxes quarter warrants of for final to exercise were QX sold. no the shipments Avino during standby of earnings of renewal depletion. generated. before earnings and QX a depreciation to Losses reported the $X.XX XXXX XXXX. $XXX,XXX in Avino revenues operating were XXXX. million QX maintenance $X $X.X of $X.X per for costs $XXX,XXX noncash received interest, of $XXX,XXX million is $X.X amortization made first $XXX,XXX first in in the first

strike have dry the the planned the expenditures and activities, With measures during continued as the include to ramp new unnecessary capital limit continued stack specific quarter, took any necessary action, have for company up. except exploration equipment. to facility which storage tailing projects Any

will with the as forward We up expenditures expect and the tailings that upgrades. increase coming capital exploration we ramp exploration move quarters and over

Finally, position. I of want to reiterate the financial strength Avino's

As on and diligently a stakeholders who X thank that this than base I at on believe an the undervalued in to to a of this quite value. ensuring It of to a continues position well are David create million position, our to come higher and advantage Avino because would our had mentioned, is increased and We sign all current are sheet allow we're impact by everyone's XX% take work balance that financial valuation working Avino us price. and things over future resource in an partners want preparation previously of alongside with shareholder significant hard bolster a that and that that valuation February $XX day. today's we is prepared our a remain of to treasury share to additional corporate

forward activities debt cash continue plans to million exploration it our rest over XXXX. at the to Avino discussion investment of over stakeholders our on for and increased the planned the end back with with our throughout our reducing maintained holdings. shareholders debt. for and add quarter, continuing plans with in exploration the will at quarter, liabilities has Xx now moving We over representing value I of for what and are David to QX. of hand $XX With we a we end liquidity, the And our including

Thank you, Nathan.

March for Our called of meter program, is increased for which to XX,XXX increased in drilling. a of XX,XXX fully drilling year regional the program funded. The plans drill total a was meters

date, vein the will the meters Santiago X,XXX the and target vein. Avino in several of We continue El Trompo QX areas the To property, drilled. to have Avino vein, including been

are be currently to waiting assays We for received.

is to operating enhanced in stack is going Circuit in That vein is production vein a mine our gold vein, at completion ongoing vein. Another of this may will exploration XXXX Phase was time in ongoing. La Avino through the the and focused targets exploration which silver present these on zones pushed confirm tested Malinche the area. that the miners for X the to on is be was hundreds well in was to X carry the mine operations. new to that Malinche, the It during that ET named the the of in Marina, use and to quarter La X. The property project opportunity. be geological discovered the needed with recommence ago. by army. not Ibarra Avino's the work other which And interpretations exploration Preparations potential of activities Avino confirming in areas. by of priority similar mineralized target on will system. low-sulphidization are our to program main be locating areas new tested and the Improvements to said recommence the style children. the years -- is continuity San mother is focus QX the dry And possible Captain It's will Cortez's epithermal at within honor current quite equipment. vein, Cortez's QX. are high-grade improve limited named Future understanding It of who tailings of been year, next may mineralization called of is the and recoveries Gonzalo targets has is in More change

analyze including forward to rest open will it our to of decisions and and Finally, look widest now and and together employees intention brighter borders communities. the to the the the Vancouver our We'd been quarter group, Mexico up. situations all most a a including collaborate we vaccine always like to the worldwide, Canadian make continue And to in remainder of health ensure to safety that our are rollouts and question-and-answer call successful has stakeholders. beneficial best productive move year, We the second We anticipate portion. travel to XXXX. unrestricted hopefully, of and Operator?

Instructions]. [Operator

Sekelsky Jake from Alliance from Partners. comes question Global first The

color you Any to any line exploration, mentioned seeing waiting then in Just times you're are for time And COVID? starting with due assays turnaround delays you in. that here? come on the to

It in has been slow getting them.

we Some results. vein complete have on particular trickled in, but we're waiting to for want we release -- the before a program

to So we some news. have next it's hard should but in the say, few weeks,

Got it.

are then sequential the X the And are Phase on concurrent? back X of Phase just Okay. programs, they that, and or

here. is Peter this Jake,

we program, the wait example, areas that are to underground there's until Regarding there for some below access. like, ET have

kind depending location. we're availability So and jumping just of and relative forth back on drill

your guess be question, answer would So to I more they concurrent.

on And lastly project. That's the helpful. then tailings Okay. just

the with later move might this you that forward mentioned PFS You year.

the on is the a back comfortable Or decision do you'd the positive, are that forward Assuming move and phase? you of making with a you you production full think do PFS? PFS

mean we'll aggressive. Saying a PFS and the do takes drilling, this probably have little we're time is year to it that. I

So depends results on a the before really of we it construction decision. PFS the make

necessarily Okay. making feasibility. comfortable decision But moving off be a the not PFS, to full you'd construction

once here again. Peter Jake,

we're of that at particular looking on that project. risk I it just depends think the in terms

given depends think the at that point metallurgical limited in tailings that there's the disseminated. and And risk equally I the work on geological that variability are time.

make at certainly, this point to early it's think a time. results PFS, that too the and But point. pending decision we'll the say then in of I So evaluate at

H.C. comes Wainwright. question next Ihle from from The Heiko

on Bisset Tyler Heiko. is This for

increase was about and talked the program drilling holes drilled see it's in nice X. announced release, the to your in March You that initially on

might recent mentioned ET? continuity think you assay release. Avino see what you of waiting for the thus from some the you you you're far, us You can potential at can that results see But guide sort in through

Sure. there. I can jump in

lot Well, all back. from those So holes should from a those I with holes that to underground. are drilled are of ET, underground. take respect drilled of

have actually. that a drilling and started haven't work as we in there underground, do to we have bit a So then blast the we cross-cut to of drift,

the can drill deposits. across we back So

drilling Santiago, the Trompo of this focused vein was the and Santiago on Trompo offshoot being So for quarter Avino the Gonzalo El really and QX that that crosscutting San of with across being vein. structure

on-strike. So to answer haven't your the we question, both down-dip of and Avino, tested yet continuity

drilling? guys start And you any when that you. Got may expectation on

We They're there. have now. pumps people system electrical servicing there and the in the down

So bringing people. we're back

want look get mining from to station. hard then to the vein to up we're it's setting going the So and drifting the and because first, drilling blasting the the away then and and we say at drill going

the be of going it's year. So second to in half this

see we're how I give in what the spend possible, will incurred we for ramp-up that. much if the the during And maybe, through total given some as expenses you halfway QX for think you us do Okay. And guidance appreciate And today, quarter? well. of in as QX? have

Nathan Sure, here. Tyler. It's

So are talking to closer are you up, referring exploration you getting spend? production? to Or about ramping

Exploration spend.

Yes. Sure.

Unless talk about you can production.

I'll exploration No, talk about spend.

great. May, So meterage, was continuing right We've turning X heavier ramping and XX,XXX we as as that up increase. June far into lot Obviously, -- got the meters, which we're path we're half. on we're in drills than expecting now, to March up. announced March obviously and that is April all was a to or further and in second

on continue the to $X.XX So maybe anywhere we're of meterage on to same about expecting kind million basis. if million -- that close we monthly we a $X.X from

quick how move drills a expecting too. able we're a around, that million the of as on dollars obviously depends per couple and quarter we're So maximum, to

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

question. a Just

quarter a on You pretty side. had the busy finance

million -- $XX million working actually now $XX in capital here, and million $XX $XX to you've So million budget. or $X million in cash got

going end still the now that's the cushion, year. healthy assuming production back So a of get pretty between to you're and into

your are for plans that what So additional cash?

in Obviously, I getting Nathan kind a comfortable comfortable been cash good first. But Avino here, to are is a we're really the activities of Matt. we the a as same kind Mexico looking to it's question. a in position. to always we're the at we've But of -- a any don't lot evaluating quarter reinvesting There's a our mine, activity -- lot And in back and of opportunities production have time, forward in, forward we first decisions. this time we're and It's mean on. for looking eye and of that they projects come to we hasty make just right? want historic very

we're... So

automation. And through we're rates looking at improving recovery

Yes. back improvements. what's to kind of view and for sit a a We've We of and got it kind of our best we'll first and want XX,XXX-foot Avino of lot capital then make take shareholders. for

Okay.

-- And the projects guess, other bit side? I be that well, at so that be looking Avino with more your you're at you're not And in flowing synergies something different? might it looking and or or around. cash a development But something some looking on always be would the -- would choice little other has first side

answer. That's a question tough to

stories. that we the at far we're are plan But least, at. still of I with funds. as to a And think going lot stories. be We like and at time, past same very, want producing way. Mexico like we we as exploration that plan to we looking on agnostic very the very focused -- -- like. Like stuff remain pretty We our cautious we're we're we there's what

sustaining was when which lower property. material want We $XX. mining find where was back Gonzalo, higher-grade were on all-in around it want to our we costs to our to We San

goal. So our that's

a to higher costs that a and Yes. can mill, of get if positioning circuit, better come our and pretty in That's material and find the we that is big -- have mill through grade some we everything the for running down we're large focus future. will we'll be much confident

sounds -- current like earmarked -- Avino. most it's Okay. potential it's for at No, that's of unlocking It current the great.

Matt. Thanks,

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

XXXX. patience great for Thank time of normal look remainder the you, a listening, our and operations appreciate listen look everyone, soon. and to again today. forward to have quarter to the forward for day. a of all and stakeholders taking Thanks We We productive resuming second

This conference concludes today's call.

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