Vista Gold (VGZ) 7 Aug 192019 Q2 Earnings call transcript

Good afternoon. My name is Brandy and I will be your conference operator today. At this time, I would like to welcome everyone to the Vista Gold Second Quarter 2019 Financial Results Conference call. [Operator Instructions] Thank you. Ms. begin may you Solly, your conference. Pamela

I Brandy. you for you, XXXX Relations. results conference Good of Vice Corp.’s afternoon, thank and financial call. update corporate gentlemen and and Pamela joining Investor quarter Solly, President ladies second Thank am the Gold Vista

Tobler, call the Doug Fred Officer. and CEO Ernest, On Financial President is and today Chief

results, risks, materially implied the such performance factors from those may recently important statements involve These information course forward-looking making statements. forward-looking or statements. that expressed Vista achievements of of in During achievements our results, for risks factors and or to about Please that this most could or uncertainties our unknown to be Form more from cause different other call, XX-Q actual we will by materially and differ known statements. be cause other refer actual and filed to results performance

over Earnest. turn I Fred to now the will call

to you, contributions his like and Thank key Directors years, management, a Chief more the Tobler I initiatives. valuable acknowledging many Engele his our like following and joined welcome exceptional and new many team financial retirement. on and contributions Vista’s well as of than in I Jack as Jack executive Officer. would providing thank the his for of member senior X leadership with wish of Doug was Vista’s the for retirement Jack July us On Board him Vice CFO. to behalf Senior of Pam. tenure Jack X on CFO Financial President Doug as would begin company by Engele’s during

resource rather on as Gold early adviser. early of including years corporate as its was him and Lydian operations most of the development stage financial CPA a Corp. those financial years extensive growth-stage of exploration Mine mine and to in management companies, corporate of call, Alacer the International. information that, late-stage with XX recently CFO gained – Çöpler Doug of has with CFO Gold and more of through chief officer, experience experience He than the Prior brings Doug For of period Turkey.

adviser, assisted strategic, financial accounting with CPA and numerous Doug mining a While and objectives. corporate clients

to At the from discuss quarter. highlights a would of our like few I this briefly second time,

and We’re with Since May, ongoing of compiling our extremely pleased been primary the on our progress optimization work the completing results test focus call program. this metallurgical has our in results. last and

feasibility Todd also We preliminary study to project. Mt. gold the commenced work our update XXXX for

what had this Once we along metallurgical an the data into been we but Some like see quarter. for anticipated testing parameters, hoped, than completion of later program we fully has today. economic the current we comprehensive the in PFS received, with results, coming slower updated incorporate will

performed our part complement grinding PFS. the the and for we consultants internal As retained review circuit to independent technical use, study upcoming fine we which own benchmarking of independent our program, an expect will

turn the XXXX. We detail Mine work topics June to Mines I the a review will Northern continue for of time later Territory’s Plan. our Tobler these over review in call, ended Management financial now its quarter Department I in results discuss to closely during the for will greater of but XX, the with our Doug of

of your thank you good it’s time call, joining. good the here for to also to organization. appreciate part It’s Fred. be today. Thanks, And on and be Vista those for the We

funding sources half a Todd. continues and utilizes capital technical working financial XXXX. good As to solid first maintain non-dilutive of to of quarter position our had Mt. advance we with programs, the and Vista a

reflects our our million. was you detail. working At this will current capital the between the $X.X turn more If and explain assets our June capital balance sheet, in liabilities. to I current will XX, Working difference

million treasury assets of securities included this liquid at highly held year-end. U.S. $X and these $X.X same We cash Importantly, of million.

net June our So, $X.X year-to-date XX, was through million. expenditures

an During was from Todd $X.X related the that los year completing sheet this as the and since the just an the Midas during in half spending of inflow share of temporary Midas’ in month Mt. price a from of in the benefited were holding to opportunity of our million lower cost. equity mostly price. was that own period Gold first by quarter, as the results holdings we Unfortunately, course, decrease to period, an a because We option de working saw end of year. to dollar by capital This XX on in did XX.X% holder. during strengthen U.S. there market. the And share commonly took offering. June mark stronger July. last This second We impact accentuated our Midas Reyes was compared to Guadalupe its see to rebounded prior balance

quarter note in This as cost million. $X.X free liabilities As non-current received basis. a was from Reyes of on two June of the gain a which the balance los closing on this shown [indiscernible] our Vista deferred reflects remains accounting Guadalupe balance holder, sheet, excess The debt XX. sheet reflect GAAP at de cash U.S. option our

million the this to accounting to the Vista. income noted holder option until gain deferred has cash, As earlier, the our is year, we property to in received statement or will transferred control $X.X but be returned

non-current for business. liability a our We assets, for is small leased offering our which day-to-day also show

June on to loss $X last of the to brief few Operating quarter million shares, $X.X million, section. This million for million. of decline turn expenses in quarter $X.X the million. were that loss June consistent net income period-over-period, a value from the X the and versus months and $X.X statement dollar. accounting at for the of X% now Gold in share the comments XX second year’s year. of for compares reported a loss And caused shares operating was the majority majority again XX, was which Australian in compared We of value ended monitoring year. year, Todd of an operating the the the will And net with lower resulting net I same U.S. discussed were increased, and the our Last expenses $X expenses swing Mt. ended year-over-year for to a difference million, Midas the dollar from value previously. this for which I the loss having the last in the our gain and as difference management Midas Offsetting gain Midas reversed down year, period largely this benefited our $X stronger holdings water cost Midas. the the

a close to be spending discussion Overall, this controls for to today’s the nature consistent going are a few Vista’s the words next outlook on remainder I and strong XXXX. the of with would year. like and remain into balance for about financial of year recurring costs

for expected we Our discretionary budgeted, will the has new spending the This not XXXX is likely latter we’re so increase expecting up internally surprises. been PFS. and any half as of wrap

which of As And corporate Guadalupe be interest. other working shares, cash, equipment, programs and securities more the comprised currently possible working convert and our the to next and of into we may to future of include for royalty expenses, sources de used holding financing the likes sufficient will mostly of These costs monetization of from our option that than mill our believe non-dilutive months. XX the capital. payments other government also Reyes our the the fully longer los capital, is existing have planned project project discretionary horizon, we Midas our fund the course,

over call will turn that, with the So Fred. I back to

Doug. you, Thank

test the the Let Mt. material announced In begin test gold this percentage improvement throughout XXXX Leach metallurgical recoveries update we me grind size Vista’s of metallurgical initial year, being reported of preliminary first on material. with the conducted an an average deposit. study. on results by the sized material Batman were with continued similarly recoveries approximately Metallurgical consistent tests coarser passing average quarter. the XX recoveries from grind microns testing gold in our work XX% gold test a XX.X%, feasibility from from on May Gold of sizes providing X at program. point on project achieved at January Todd second results previous

coming and test Additional work is are the results leach completion, expected nearing weeks. in final

grinding improvement recoveries tests optimization quarter. program, to metallurgical to the XXXX $XX Mt. We X% approximately leaching results X.X% to leach PFS, and XX% after-tax that of and into approximately be later our results conclusion recoveries for a low results tests this PFS. add compared million the gold reported IRR will – the will in each Todd’s anticipate final in January range, improvement reflecting average Upon comprehensive indicates achieve incorporated anticipated Analysis could significant the fine the Mt. in gold completion the of after-tax Todd updated NPV. an

in January to improvements from the recovery the exchange the to rate size, gold dollar/Australian since foreign addition U.S. grind finer a XXXX. resulting has favorable changed dollar project In

and Australian in significant of dollars, impact have is the will in positive and capital project updated approximately on the will XX% costs be expected economics. operating project denominated be economics included to a this As

and the study next. circuit of about the talk benchmarking the fine me Let review grinding

ramp-up staffing we practical. conclusion our the been are consultants benchmarking independent to we reasonable of studies assurance to costs, assumptions and our program, capital review have inputs for As are engaged and and our preproduction optimization operating are grinding come schedule complete that independent schedules and have that comprehensive provide an to and the and These commissioned the internal requirements. metallurgical study and circuit use to fine of our

mine Plan, XXXX, We project submitted in permit of operating review me Management North of the to Northern let Todd ongoing. a on Next, the update which the permitting. provide Territory and an November of in is Mines the Department is equivalent Mt. America, Mine

the Mt. Todd approved, by expect for receive permits of We hold will authorization Once year-end. Mine major project. all Plan the to Management Vista

with of results expected metallurgical work released So the demonstrate to and nature to looking believe the independent the value-accretive test into will weeks. study, incorporated of in the the we this these clearly quarter. optimization year. These later be final input comprehensive the feasibility will ongoing which forward, update, a announce results program results, then coming We be the of last study are from started our review fine expect grinding benchmarking along preliminary

of to Mt. do we asset. reward it development our and for represents or underlying programs, have this that shareholders. it is alternatives With That value other to that the value Todd a not that potential to encouraged its makes impractical, intention our opportunities said for and Vista recognize the Todd we ascribed optimization are project plan important valuations no for by current the the conclusion upcoming of shareholders Mt. undertake

Our actions our Todd our first. demonstrate of and past creating, enhancing commitment over for preserving the the value Mt. years shareholders to several

and will forward, the robust study move project wanted gold our greatly upcoming achieving project is most the that infrastructure, economics Todd project on stage greater believe of list our that in and Australia’s excellent with this coupled for advanced Territory. a for these we continue multimillion-ounce Todd gold assist We has of Mt. and the technically feasibility justify short attractive As build a industry as the hand. in Northern environmental a on we appreciation This the place we deposit us from preliminary expectation factors, that low-risk and development to costs investment peers the community. focus It’s valuation favorable to permits Mt. stage on can projects.

Let a XX%. is performance. share about over me share moment now price Vista’s price up talk for Year-to-date,

improved by price gold believe project XXX%. As the ongoing X.Xx share of gold, compares price price higher to a improvement real Vista’s optimization price economics. the horizontal XX% prices to price This XX, in that price leverage. X.Xx to enhance X, the November further mentioned value it calls, shareholders the relates percentage has will previous relative value in we’ve enjoy gold. gold the when Vista’s improved This to to of the of has the of by on we We while its in August of the out price the approximately trend, This the improving to gold is as basis. and Vista relative the the understand highly leveraged broke is of gold. improvement the is of GDXJ work gold leverage Since

located environment. value discussed leverage seen created over the X have be reserve million in Todd and gold and for existing with last probable Vista’s believe price the conclusion, an attractive site the even proven natural a that in a price have package controls paved our of the profiles, largest gold gas in project in gold With such Mt. along the our Vista and to freshwater shareholder reserve The ounces facility. improvements X.XX and and the estimated In gold to infrastructures, tailings project Todd Australia. with that have deposit undeveloped single [incumbent] lines, months. the to Australia. pipeline, production roads gold It the would reserves, Northern of storage leverage is ideally gold Australia extremely price foundation demonstrates largest is project project We Territory we we lower Mt. improved as other reservoir today, power third

local our of the We secure environmental now hard that focused on have and firmly the gaining worked Plan. are believe We is stakeholders of earned trust hand. the the of social the in permits to license authorization the Management Mine authorization and

We’re excited a economic in to the major weeks. the announcement results potential programs and Australia. demonstrate earlier, described Mt. results of optimization as the in believe the about gold producer and ongoing technical results, new the initial become to updated forward Todd look We the of coming has that

an www.vistagold.com. gold Mt. represents believe potential, Vista leverage investment corporate more the accorded to low presentation, exposure to gold looking value price. a comprehensive exceptional value, Todd on can website We I found at For geopolitical our for in which investor the to Vista be for the that project, you assessment and Gold refer of opportunity the our growth

prepared That concludes our remarks.

any now participants this respond will We to on from questions call.

first Your Heiko Instructions] comes from [Operator Wainwright. the with question H.C. line Ihle of

my guys. Thanks for questions. Hey taking

Heiko, how you? are

Good, really today. the you going thank years. over in work was pleasure And you, all Jack, It’s for through congratulate earlier hard missed. sort me quite this million out the call, loud and just thing to Midas, be I short-term the company and that sort remarks, of the with XX-Q if Doug talked thinking And million with his a intro want the the been "cash I of missing for Doug about working good. mentally I’m you’ll appointment. and And on to your this prepared $X.X just XX/XX you investments" out balance for the here, take was sheet. but one from went your on $X.XXX in on today.

burn at essentially million $X.X of that’s X million. $X.XX for months, Now a annualized

of how we possible, by and year even you’re, looking should nearing be quarter? your of this for rest leach the that completion work, burn and, Given rate if into are words, these test the maybe

Sure.

and some would as I on would the would seen costs, be these will be call holding for previous trend mentioned we quarter, which the with what quarter. costs those third expect our What in balloon costs And be maybe that in neighborhood million to we of the the studies. million continue lag in a consistently quarters. then during you’ve corporate So the half costs $X up you’ll $X.X would our the previously, as of fixed see and Mt. Todd fourth wrap costs during early of our slight to the –

Okay.

So call it XX-XX, QX? QX and

Around probably XX-XX.

XX-XX.

like And can once even you what of a completed, looks actually are the because than using And mine testing and with that’s use Todd substantially be to if consultants it’s bit we mining our to you leach may other a much you. I just earlier. that more provide that’s you spot of that Thank color little the the methods going lower I quite on more just the changes to be, deck. some doing mean is next improve were again, preliminary discussing Okay, in but on modeling exercises. XX staggering, maybe and years, helpful. increasing profitable, kind so, probably if very on next philosophical, in recoveries any? X bit more, is model philosophical. mental effects have probably the all price this work then line question that frankly, guys your do or based our what more if goes internal Mt. done a did focus higher from at the you just see that of share the the quite over technology And I improvements or price and anything? is like GDXJ And the mean what the quite price

That’s a Heiko. question, great

Your observations are very astute.

like in today. of your the as very programs. results rates. as As like exchange and to gold that’s we price that results to model, we the had very the we’re some using gold satisfied what optimistic, testing the And you and results be foreign changes use is a leads word, in well results the that And we, we announced the have as these seen very, look with the PFS, staggering the be impact price to at programs will, have conservative you, very, your us of

possibly could we to technologically years what to the look going as the mining. asked change next forward You XX And X, regards I’m to processing. add that the with to

technological our to – accepted are of You’re side well widely incorporate the that processing and the that proven aware on well in advances industry. endeavors

grinding crushers. the adopted roll we’ve Specifically, of high-pressure use

on were starting XX We implemented things years, have being just that they’re tried resulted years using these larger we’ve XX industry. more XX on used wide scale We’ve and sorting, in well. and ore years the others a ago, have in a technology been in which the basis. – be improvements adopted that Today, for fine implemented to the as were grinding last circuit. grinding implemented have These the

we’re the grows, be the a the On rock specifically waste things more autonomous be designed of the them. pit Todd being term seeing has more of side – The Australia They’ll east the use side, mining trucks widely been on moved. Mt. one that but the is at call that that more of mining the and not used ramps it’s moving in will specifically operators without pit. not fleets, in way long being in

are haulage the experience more road, that may some gain that mining area improvements important to one we as more those reductions. economies and equipment, equipment, as that’s look and allow achieve miners down so Australian characteristics us that And at cost the possible autonomous with

listening haulage numbers the commenced, those mining the we costs just many are on labor people very for important and costs aware operators. And when were seeing used unchanged, have any the be being took a that first almost of operation. to You as it and autonomous support we call as aware are part in fully will

technology refined, mining experience amount we’re of operating with of with actual that’s required fleets. labor autonomous the implementation the Now being and seeing side the more on in the reductions haulage

be that And we’ll at. so one area will that be looking

We Mt. people the are the of and discuss things and demonstrate to confidence that are that to will in have our made. some there we potentially thoughts that the – potential continue Todd it’d but there’s been de-risk premature grow evaluate to to do be and opportunities have ideas, could technology to level things decisions

as one out exploration at to over very Todd Mt. with a mining think we’ve point look is stated simply a might kilometers would we we begin to be And future. the thing money energy square the at important to the the comprehensive I land program. that have X,XXX effort that thing before, or the licenses, that’s that exploration have, significant in not extended package, contiguous we of or that one

on Our map continued has already exploration a and year We’ve the and license. very easy-to-use and that focused efforts this budget about targets, comprehensive of know identify exploration been at database the what same – a grassroots modest. potential the been time preparing we to compiling we’re

that potentially so yield another in that’s could results And area Heiko. the future,

else in And that so there And back will this it I on get phone comprehensive call, going much, thank I and got was than me to everybody on for you on the to I a call think queue. this get that. well, longer-term is a more appreciates I much plan game thought going shows tell answer This was as you. and much, I color.

Heiko. Thanks, good. pretty Okay,

I like Fred Mr. the turn would call go please Sir, for remarks. back ahead. closing over to now to Earnest

be taken to Again, everyone would Thank with today. the we to us like you, who’s on Brandy. time call thank

happening, that about excited far. thus the seen very are results We what’s we’ve

final wrap We and forward weeks to able looking by forward report would flow the the subsequently and of and to engineering. significant that the attentive test to we who being are look program the results on of update substantiated complete the a listened that this invite work I who the study. call on are and the to to news will keep be eye work an announcements months are to to come. testing feasibility amount call up on preliminary coming all and We as the

everyone results in rates. foreign be of by that pleasantly exchange will very change result think the the I and changes surprised as in a recovery the the improved

the gold previously, you providing will a value current I project gold think we be As today’s we be stated which sensitivity is at help slightly but very using analysis will price, understand price, will that we conservative exciting. the of

interest pleasant will participation very all the and I that, simply of for and your you With call close you your all thank and day. wish for a

concludes call. today’s This conference

disconnect. may You now