Vista Gold (VGZ) 29 Oct 202020 Q3 Earnings call transcript

Good morning, ladies and gentlemen. Thank you for joining the Vista Gold Corp.

Third Quarter 2020 Financial Results and Corporate Update Conference Call.

On the call today is Fred Earnest, President and Chief Financial Officer (sic) [ Chief Executive Officer ]; and Doug Tobler, Chief Financial Officer.

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

conference over to I will now Solly. turn this Pamela

begin. may You

for everyone, you, the Vista Thank Chantelle. you, joining Gold Corp. Thank

Financial Quarter Call. Third Corporate Results XXXX and Update Conference

and Chantelle and our have As this turn Earnest. we Fred said, Officer. over Financial also Earnest, time, Tobler, our Doug call President will just Fred the CEO, have I At we to Chief

Thank you, Pam.

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

thank joining I'd the call all for to of you like today.

investor the opportunity rate the corporate greater economics leverage to an of $X.XX We an strong discount Mt We this IRR, at rate and morning's gold are for of extremely project than after-tax geopolitical pleased the an for a believe and an with demonstrate risk value price financial potential, exchange At results strategic internal low return, objectives. gold rate, our exceptional and X% foreign XX%. Gold our of continued price. net billion present execution value, third and exposure quarter Vista growth represents looking Todd

well-being be priority of quarter which and the ongoing communities the pandemic. our addressing company. and in third continues our impacts like employees to we summarizing COVID-XX a Before to The for highlights, the of health and our I'd live begin by work

the corporate Our spaces. activities corporate in participation. working conference Video replaced on person team travel a executive in continue and remotely office conferencing with limited has and

Mt COVID-XX almost Australia, Northern control relaxed. in is both Mt Territory, less and Todd mitigation is and have cases continues United project COVID-XX under our presently date, are the their been restrictive. nil, measures an healthy. located, management where Australia, Todd States and to that operate plan remain and In To approved significantly the families workforce

noncore the believe extension near-surface a north-trending of We commenced we to Todd to quarter, Mt and balance our project. test the deposit the of we part program advance grade the be to drilling zone. effectively continued And higher of gold costs derisk structures which Batman capital We and the During sheet. monetized assets, spending. strengthened mineralization, continuity and managed core

geotechnical higher pit. to completed for Batman also evaluations dewatering continued designs, additional to equipment process convert foundation internal resource and fieldwork the the potential gold we We reserves prices assess initiated of

of our review We management the Northern mine mines work continued the division with of plan. Territory to in

ended financial to In signed I But I'll September the potential now confidentiality number past these our the this discuss will of with XXXX. for of turn in results in call. the detail quarter, a XX, a time agreements we later Tobler greater development topics over for review partners. Doug quarter

Fred. you, Thank

operations XXXX. I'll results. September for quarter recent available was and brief are is yesterday XX-Q most our now of our our overview that of provide more the financial on for results financial and filed Today, Our those in XX, our ended a just in-depth analysis third position a quarter interested website of

million overall increase September a and to rate. improved cash financial monetize plus modest largely $XX.X at investments third a short-term assets ability and the our XX. million notably, Vista's Most maintain during totaled $X.X quarter noncore expenditure position our third quarter. the attributable This significantly was during to represents

During Midas of realized the as price the $X.X shares, third quarter, received Reyes we remaining gold Los of net purchase cash $XXX,XXX in net we the and final sales proceeds payment Mexico. million totaling from for project our

also program. through limited about use We received of $XXX,XXX ATM our

position, As to to as slightly, with quarter. no used expenditures, our $X.X debt. trend. have And recent our in for is operating the a line was note activities for on This our down generally quarterly cash third Vista financial continues million closing but

and ended talking now a comparative our I'll for and XX, income XXXX, XXXX. spend minutes loss September periods about few quarter year-to-date and the

quarter income of loss key the the million compared X year. it same were drivers There net that XX, net to XXXX. ended this we for the recorded when last $X.X million for net $X.X quarter's account and of variance income compare to we For September a period

resulted on last income when XXXX, properties $XXX,XXX. year. option of July we of previously. Midas mineral from for $X.X in remaining the the last gold we comparison, recognizing This we recognized from gain of secondly, came or And resulted deferred to million previously purchase from million quarter gain other shares. quarter mentioned the September during September on First, recognized compared year of $X.X loss the sales Reyes, the XXXX. a we This investments investments a XX, final on price By during payment balance million gain. ended nothing for primarily third The the disposal gain our recognized this gain other Los quarter quarter of I of XX same received as ended $X.X

Moving on through to September year-to-date our numbers XX.

$X.X million September the And again, Our in XX, XXXX. period to was net same for This key there loss drivers. were X a million. compares $X.X of income X for the ended months XXXX,

investments for project Gain mineral million reported partial $X.X on XXXX property to and Reyes, as fair and on interest the gold interest The previously, for million driver. Indonesia. on ended a XX, to year-to-date period disposal September other gain market $X.X was same X we during Midas which reported Mas loss in fair gain value was $X we of This cancellation the of adjustments $X.X on for $X.X X we from other investments ended discussed for predominantly XX, in second nil to a million months And of the This of year-to-date, to for gain reported sales Midas the First, included compared royalty was of mostly Awak gold million, XXXX. months September shares. I XXXX. million, which shares. loss XXXX, due the the plus Los adjustments

assets this to agreements end, Now in an capital place working payment have to to this its check of upcoming manner. of cancellation of the in over means million remaining a Vista for recurring its from time Los Mas a $X.X $X.X looking non-dilutive option we cash realize forward, payments of at up To Awak royalties. million months next generate and expects million monetizing the continue expenditures non-core as to Reyes and hold $X.X to X in

either can or to to alternative So rights make pursue interest monetization the will royalty fails strategies. Mining PT Prime this and Masmindo respective these payments, retain

Vista assets, also gold noncore include listed royalty securities. other various owns which interest equity no another and equipment,

requirements, noncore discuss programs months. position improved This with for obviously our but fund during In will value-added recurring and this will other that the monetizing closing, prospects we're of in coming also some assets Fred the later cash the our supports pleased call.

for back to thank call I'll to So time with I'd Fred, your like over and everybody that, the today. turn

in achievements September with an quarter then the the I XX, Thank and this year. remainder you, begin outlook Doug. our XXXX, to will provide bringing subsequent for of ended

existing geologic June, ongoing announced evaluations at the plunge all, extensions. and zone. North positive has results data, Todd we drilling to up of of the Batman what extension In of high-grade of the First believe we of test northern subsequent, identified in the the validation Batman Mt core is field

targets. commenced comprehensive potential test as targets a extension the definition a north Batman drilling ensue. and deposit, excited to an program is proof-of-concept about we've We're extension results the drilling by known hanging confirm the mineralization represented north expected And that should the result, drill a program resource of Batman the formed Batman structures wall lodes. and to these As

follow. full program results are to coming from results expected the in the first weeks Assay holes with

Based confirm this of program form Batman to mine and Quigleys Successful the the This chip future corridor of could than grade better of Furthermore, the ounces gold, our the of for deposit extension grade with be soil believe the average Batman deposit. to the structural extending higher early zone continuity mineralization grades for in this to beneficial the deposit gold production. benefits average sample geologists core stripping. would approximately sample the changes the and basis our XXX,XXX right now. on of the reserve of kilometers X.X could combined northeast, efforts from XXX,XXX between deposit years completion outcrop mapping, results, that with host first the lower the drilling marks within and design

success or X water with X let with to ago, I'm Next, program very was initiated pleased about our ongoing management water Mt at approximately me contained license. inventory management. and talk water Todd. water treated report When gigaliters water. began at successfully in total site the years gigaliters discharging Batman of XX.X acidic Territory XX.X of Northern this this discharge of total. treated approximately EPA a volume The We water pit compliance

the almost Batman pit dewatering this XX year. lowered the by water and We continued meters

effectively potential We prior representing to construction. Batman start milestone by a be expect dewatered of pit important mid-XXXX, to completed be the to an

for program crusher from designs. lower for and this they're provide are conservatively Todd, needed we a information as complete appropriate foundation fieldwork finalized. to Mt This feasibility engineering. result future designed decrease we capital At work results when is expected to geotechnical those for being costs presently initial also detailed time the to completed ball -- Lab mill foundations, study deemed believe and in

price aware, in As a the increase gold months. tremendous last have seen we in everyone X is the

The economic reserve to $X,XXX Batman in Lerchs-Grossman study price, a market feasibility which today's on initiated to open-pit floating design pit are is in based gold cones estimates when our these ultimate XXXX using evaluations gold gold and higher have conservative. very internal preliminary We evaluate prices. recently price key shapes. is factor related The

of designs. extend price for the increase to the the the increase sustained to gold modestly prices, life project. gold of the This the pit has $X,XXX the impact resources $X,XXX or is Vista potential changing With evaluating and recovered in economic these

let an on update permitting. me provide Next,

major we're continue and we plan. the mine development of believe management plan, stages process approval in to all of Once We which the in mine America. Territory will Todd of Mt the the of approval We project. of work in that mines the permit Vista will hold are of the approved, the Mt Northern final the months, division Todd receive the North coming final the operating for approval on of a mine the the is with permits equivalent management hopeful

in Year-to-date, XX%. Mt strong gold couple XX, improvements XX, part due GDXJ, which out to the performance. days to XX% price economics share XX%. relatively in up leverage Todd shares address gold, next through gold improvements with enjoy Since price just Vista price. to is the the compared continues its of up price gold ago, significant horizontal a the small approximately broke project when the October to I'll of in November improved has by are approximately Vista XXXX, trend

While price of -- the approximately GDXJ this improvement of basis. Vista's by Xx percentage improvement share in over -- of price Xx a the X% to has same the This the improving XXX%, on by X.Xx of sorry, during under almost value is improved compares I'm just the time. gold in or gold approximately the price period the

consider we positioned continues and Mt reward shareholders. and who prospective to is Looking will Todd appropriately Mt well gold advance ahead, value to and environment partners, development in recognize derisk the of Todd believe the current Vista

believe best We the in build to needed the interest stand-alone of on Mt continue dilution is basis that our and a debt shareholders. not to Todd

the technical list Mt all is and the short that gold in of fact that operating deposit. for of world. projects believe major that with stage a Todd technically project achieve the we the place approvals its economics a the Our robust development-stage permits, of advanced Australia's Todd for -- and gold attractive to in most these, low-risk excellent on of Territory, infrastructure, the the objective with costs, favorable the environmental we hold coupled project valuation location reflective Northern is size Mt of Together low the

robust Our economics engagement with exhaustive a basis partners the technical prospective and studies current project. development provide market demonstrate the solid of for conditions

Our to appropriate reward our for provide goal shareholders. is

Tourism of seeking a and division the manner, to the Territory plan Todd noncore department addition In continue receive Industry with Todd Northern mine Northern management other working and opportunistic. to assets in Territory Mt newly partner, we strategic cost-effective the to when the of and monetize formed to de-risk Mt authorization mines a Trade of

gold we impact on project in prices of are Finally, economics. with the higher price, evaluating gold the improvement positive mine continued plants and

work this the find stimulus around XX in the for in on packages. record prices cusp The approving undeveloped third gold years In has coming we the have X.XX conclusion, the governments largest last months. Mt in project Australia. deposit Australia. well largest XX over ourselves Todd positioned of single and Vista With project reserve We world million we believe price probable ounces gold as proven the completed market with and gold several in of a the controls our improvement additional the gold sustained bodes package reserves, to in

exchange Our XXXX $XXX gold a $X,XXX rate at morning's $X.XX ounce million a internal demonstrates value gold of rate. an discount price rate this price net present a of return and At of of return $X,XXX at of We and study be XX.X% foreign leverage $X.XX level. foreign consider and prefeasibility net billion present XX%. an to to rate greater with this rate X% at the discount an than the the over internal the after-tax at X% slightly value of project same rate an demonstrate price of gold of project economics significant $X.XX, exchange

is tailings of and the and Territory, jurisdiction roads mineral mining Northern production estimated freshwater natural price Todd ideally power including facility. to shareholder we project and lines, Tier to have pipeline, improved value. the achieved, The created existing infrastructure, a in and along paved the site with have reserves the foundation gas profile, leverage improvements the for reservoir gold X storage with upon Mt the located Australia,

authorization of mine and believe management in is is to stakeholders hard secure the We've firmly the our trust major are local gaining the now focused of plan. the Australia, in superior in authorization a realize to that projects, We the worked the the the one believe attractive of We of license a and shareholders. have social earned partner permits and hand. asset a I the Mt environmental our on but development-stage jurisdiction stable politically at and in reiterate time, our not the same advance and world. finding gold located most mining-friendly to just commitment for value project, Todd

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

That concludes our remarks. prepared

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

[Operator H.C. Heiko Instructions] first question Our will come from Ihle, Wainwright.

started in about call. I'm only talked bringing release this up because just of you talked you the quite was on gigaliters, at the you're what I fraction, when there only with. I mean I with about fraction the being a which I dewatering couple full. Batman, a more X.X years it it thing mean, extensively, of this mean, continued is a you substantially small ago remember

to you environmentally water. like Do maybe another in all dewatering give sounds just to regards progress it's you're that discharging just significance safe pit? it on feedback the want just of do meters. audience to bit the XX your little want us thoughts mean walk that? done in and I to through But the a some you lost You maybe of

to the was our directly into site When Absolutely. management of River. under of Todd we we acquired the acid Yes. was government involvement which project, Northern drainage, prior Mt the being the rock Territory inherited of Edith the was management discharged in the one the challenges

northern water, subsequently cost-effective drainage in problems. such the and was that with able Territory treating been and then subsequently water to companies Northern point, was the dissolved demonstrate mining at practice. We successfully has we one We pH just entirely the management procedures came and and subsequently procedures dissolved who for the of territory, other that treatment the government gigaliters protocols that pit metals. acid to protocols the that The and the began efficient, over -- project, we rock recommended executed stockpile water. face similarly we on and plan. were to treatment with As full, same X.X that to have in changed XX.X plan operating results EPA And

have Territory water. clean authorization We discharge a the form water, last subsequently that to And water, EPA is years, Northern from been we've the over through several the of treated now in discharging the the permit discharge the pit. received that

water, gigaliter have to pit. if are X.X remarks, As of aren't gigaliters in we'll down be normal years storage rather water, the clean And that, we we where as wet This have the this for mark dewatered and our I ready of with project million mining being nearly in the water whatever facility remaining of River. the in than forward. at we is full milestone season ago, And able season. completely approximately pit, X.X tailings is, we now or water, the cubic in several the gigaliters decision year, left for indicated anticipate will a to pump Edith made discharge it at the meters, significant the to we was what a wet that going that end who date subsequent familiar to will a the will point X.X those be

and environmentally. concern been some a also we going our them So in on marks We that respect. successful the of the them. for addressed keystones the That earned accomplishment This results on in. it were of Northern do. told what project great trust very for our was quite time. considerable solid have executed problem us Territory. a a and to And amount We the to plan, stakeholders with the marks is We we came of company, a a have we probably but this one significant very that it accomplishment the significant relationship working is accomplishment

there. color appreciate A very good answer. I the

current about of does Moving some if confirm targets, on plan that where pertinent bit environment, on mean does that? this years. feedback additional I little mean exploration. seen we're at Maybe of provide your just you not your and these mean price I -- a I bit to schedule? especially in mean, gold a little the a exactly given is question, levels what mine

Yes, absolutely.

the surface. I meters north core This of extension located the size limits of have Batman so XXX,XXX geologists Batman the is XXX,XXX zone at and It the between the a As is of XXX target or of pit. ounces. the for designed presently indicated,

what full And a drilling We have of concept of range to we what geologists, it X target especially first stripping on that a the rig in we first into will target or now and the we to challenge drainage. If presently additional size to the the us drill for is it this causes that mine that have time drilling demonstrate be our time by the then of mine we're as it will successfully of back up effectively potentially that is that the extension outcropping holes And expression do to have in to the resources the need -- us significant schedule. mapped believe the a in this believe by will is will what year this years. very able complete confirm convert defined schedule, impact to to the in this this a expected, results is. drilled come

able stripping the additional our of later little Right year would mill early bit early with of front that stockpiled ahead we get impact in ore face spike at as year results the then of the life overall the the the we're of mine, complement in some economics. would early little very a the North mineralization the To as X talked significant The and core to wall we wall. that the of pit. hanging as be life And zone now, further that project this economics grade starting be X, also material. this, we improved mine. in Batman we we'd feeding result there's project. face on boundaries result, in this inside be With -- improvement programs in this. the part that's that the year would and the the the previous lower pit continuing And a of in could improved line, identified grows stripping we've X stripping, the drilling the that the lodes at of project mined in a extension, excited very into that hanging a expansion just the Present about economics in will, resulting of drilling the have about pit in in have mid-life we've

have in in of and We life the is assays, the are and this the mineralized waiting of part decrease confirm in and the ratio ultimately a for project hole hanging change first further the mine. continuation and of wall, these program change expected could drilling plan drilled which result slight loads the to for the stripping mine the

coming So very to Heiko, those being program, we are results about we're excited forward look this announce the to able weeks. the and reasons in

And on sorts there to you people Very your Australia. just the have already read. close XX to just on there, whatever Australia impact is your then mean fair. correct? in ground real so clarify, understand pretty you no you I people operations, stories But your much. the of mean, guys I plane and crazy is have mean, there on all I everybody, I people not

That's correct.

cases the government has middle. COVID-XX in as And started a indicated, almost I and restrictions. controls COVID-XX of relaxing the Territory is Northern the number Territory the As result,

Our are to able move about freely. more people

the to closed We unless ask travel opening within other Pacific government from country. Australia, for be except one it open happen economic recently they're opportunity travel its coming the allow call the thought that to on lifted maintained continue will most Northern days. the tasked its was health business project and up the starting mitigation New XX the quarantine by manner. with those he people countries said for question officials Western about that those COVID-XX within from one to seeking you Australia will a they're for of and first management that's to when They're restrictions I to areas still with that that go staged and South the which Wales in is recovery of opened has approved -- a operate they plan, Territory Victoria. COVID-XX borders and That Australia has boundaries might officials. on the to under been has boundaries The he had it, outward be working there. Asia opening -- to move I more

we our date by have not when within to of a to will travel. activities do territory, be status pretty much the specific So as are northern yet we to But begin able unrestricted impacted pandemic. current and the not

[Operator Instructions] Matt will next come from question Farwell, ROTH Our Capital.

are I study? results, -- are pre-feasibility our if can And was a with think you comprehensive there in do you seeing you expect wondering the drill successful we then updates how program? more what considering -- about what to can XXXX to

Yes.

January. now on after before there of as break XXth that drilling traditional X roughly from we of holes the the Xth expected, drilling XXth to all back that available -- would And December the begin the in at comes have premise and recommence hope the site. year of assays based to right the the be So the to that, or Australia we're for reporting end will expect

decision to a would could be feasibility of the inside then project? complete and take the accompanied be the be third year a of we likely if Our be next were a to engineering part able drilling couple the earliest, those as resource. expectation stage, resource sometime simply of step months work update of complete to very we that different consider sort plans. study in update likely sometime some next drilling would take update? X out at an of following then of study definition factors. complete increased The do find that Or year. fourth One the made, And to those on mine quarter and to a resource have would X completely at -- based of for that be feasibility drilling studies months as that the would to first the the to late of for completion the by that update would do a more drilling results drill be the would that preliminary Most quarter we resource announce That likely project. we in

Okay. on treatment And That's what just the dewatering? pit the treatment, helpful. on in the are water background methods being Great. employed

we dispersed much the So limestone we and in -- was, first limestone because that it the into work, and a of as it's pit. used test finely dosed cheaper ground through was form. after isn't lump than And the pit acquire used we treatment treatment, to extensive the stage Limestone first generally used lime.

that limestone. We the And that switched buffering period up for allowing longer using key and of of balance ground for was a subsequently X.X the to take from pH particle and to about to to amount a reaction so we became size -- the X suspension and successful the time material to exposed finely surface with area reduce place. We were reaction -- lime. to by that in in so getting the retain

resulted last result, required of the of a precipitate And the pH the of complex be in metals And to the the contained that complexes that was that less. formation And X. a between to to allowed lime rock a X, was so buffered solution hydroxide in bottom. approximately out less. roughly that pH metal then we drainage the were and considerably acid to of was quantity the And up as of the cost

the And the when present around of from that the -- metals XX.X% settled water we're settling, with time. And discharging after removed at pH water. the this down X.X that's clean approximately period the of a

Got it. That's helpful.

XXXX? million you first this And receive the $X.X balance -- the quarter. final so Can of you've expectations what the done to a are those job of in as quarter sheet expect they're you scheduled? receiving Do on boosting your payments good in

Tobler, I'm respond Doug to question. let going to CFO, that our

Yes. Sure.

this. is And equal the are for which a from January million. between $X.X the components called X those the company scheduled payments So July, project, Prime to Mining. Mexico roughly there's There's and really for payments fixed and

well. are guys those So advancing

don't, they we now, net. commitments we're some pretty every expectation they'll we in sit, will be royalty project again, interest those later. Mexico, have We confident right us, which, and then is the -- have where something And market we're grant to in that But reason if turn around those. our for in can

our The projects guys company payment are other And PT there statements. Masmindo, part of might called floating around Mas. Awak a is project in see again, progress. group you an Indonesia, option. those is great the option That But making one is which called is in Nusantara, for their at which the financial --

they're in of Just in brought the we their engineering they design and partner, front-end Indonesian progressing months, as an through last few speak. some

comfortable all of that's we're make they, again, get But some going payments. to think. But So we pretty reason, for shape, come don't in. we still royalties good if in we're the pretty that the

[Operator Instructions]

Chantelle, there other it questions. are appears no that

sir. is That correct,

So taken with in up We'd the call. thank to to has call this who the morning. we'll wrap everyone like that, time participate

would results we of just strategic financial and extremely reiterate our continued I that quarter with pleased objectives. our third are execution corporate

the -- interested of foreign Mt demonstrate the for believe, economics. remind for the are at an that and invite is Gold discount after-tax partner than about gold improvement, value to dilution at strong opportunity project to doing investors little, and leverage key low learn to value, price about more net is our We with to to I significant this believe investor us rate Todd exceptional very believe develop our what looking shareholders opportunity Todd price to be story. the growth in exceptional greater This a a of transaction billion XX%. this additional and we're out, would everybody that the is with price rate think and our stated, We exciting these an that we I focus a As our able a that that X% today's geopolitical in bring to that of Vista We risk value. is sustainable. Mt strategy leverage We the represents gold we allow present and project the creating what economics if exchange to demonstrate of price. through rate, -- internal price will for gold. share $X.XX and an parties, return potential, project hope accomplish we learn investment morning's exposure is gold shareholders. to shareholder to for and more interested and reach locking plan That development any,

the been done the why happy you amount we're We we you so listen any you about understand those or joined to as who take project questions move to who us. the to prospects learn Todd work we to help if to be shareholder out for time spend more, will have thank Mt the morning and for reach that's and have We'd time invite to like call and value you call you and of this the this excited rebroadcast. Again, forward. tremendous those would of with its to improving as

the thank we'll that, you. very everyone with you being So call, wish for on and a all pleasant Thank we day.

much. gentlemen, today's Ladies now conference. this you very concludes Thank and

Thank rest you. You may disconnect a the phone your have lines, and week. of great