Eldorado Gold (EGO) 29 Jul 222022 Q2 Earnings call transcript

Thank you for standing by. This is the conference operator. Welcome to the Eldorado Gold Second Quarter 2022 Financial and Operational Results Conference Call.

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

and our conference Thank welcome operator good I'd everyone. you, like you to second call. results quarter morning, to

Management's Before measures measures we statements be and that risk remind presentation Discussion will included call. the the I in Please we on to the making and Form. non-IFRS in in well cautionary would statements begin, as referring to as you set like factors and our our during forward-looking non-IFRS refer Information disclosures Annual Analysis to the the out

Dick, Joining the Chief Operating Vice Other on Executive session. Burns, Phil available President members have George Officer. Yee, leadership Q&A senior the of be President Joe and Vice also President me Financial team Executive today, Executive for Chief will Officer; call and Chief and the we and Officer;

yesterday be on dollars discussion SEDAR today operating both All second They've details and EDGAR. management's which quarter and Our conjunction XXXX been filed U.S. quarter also discussed statements website. and dollar and unless second available are in are our otherwise read stated. of figures financial our financial release should our analysis, This on results. with

the that webcast. We will be speaking to slides accompany this

a questions. for call for At queue this Q&A. now download from our will we call the analysts to website. will these to over can copy You slides turn remarks, time, of open After the George. will prepared I invite the we

morning, good Thanks, everyone. Lisa, and

financials, open from up highlights before Then, to to outline our to of brief call. results Here's go and our and it overview we'll go Joe Phil for performance. through provide a questions it then operational today's to analysts. the through the I'll passing QX

challenges Kisladag team Efemcukuru Lamaque strong quarter. that with worked this face in pleased improvements And seeing year. in results performance I'm ounces has production In third increased lower quarter, from XXXX several second at gold tracking and at our would ounces, leach operating the the quarter. that which end to second pad We production our guidance to of the had range. of report hard XXX,XXX significantly, the We are of Olympias. maintained at towards and start improved original the positively placed impact the Our the to of range XXX,XXX the quarter, in

to We in be later to second production weighted Joe the continue the half. expect to will operations to full-year in more call. the speak detail

noted quarters, inflationary to we in similar previous continue we face wider the pressures As market. have to

year, of offset key the cost quarter. our as from partially commodities Euro in a consolidated on and to for impacts first costs in labor Lira imposed guidance revising half the supply of Türkiye, in consumables by Türkiye ranges chain of lower reflect half experienced we of and first issues cost weakening increases the sanctions the We're were year. Greece the Higher and result the and During inflationary Russia. pressures second expected in Turkish than XXXX production the gold global

our project cost line of VAT place the in the in Skouries initial with reagents, production. in execution our team the at will the quarter, $XXX In million concentrate The additional Recently, focused largely activities. and execution completed bring with Phil steel progressed positioned to equipment into capital with full second charge Olympias items, the path in estimate. one the are processing a construction shipments reiterates critical press, area study to tailings filter order lead labor as this estimate the we project. Skouries the we and erection the of import and feasibility of This the for already call. on China. activity pressures purchase local confidence and to inflationary electricity to readiness enclosure is the more well costs work for in such long consumables diesel, and is access Continued commercial later of in advance on which in detail associated in Gold speak facilities, the

discussions advance. to Our Skouries financing continue

available are joint including equity the We debt lenders as through and EU and projects financing and well options evaluating as metal and Fund Recovery Resiliency all venture EU Greek partners, streams.

work optimization selecting for de-risking of forward construction the as continue and at to driven package continue updating towards look second the Our in will of in be focus approval XXXX. financing board for future. half we and We a to the by to market restart Skouries the financing value

financing Total growth a $XX completion additional will project for of at now the Skouries allocating year, And capital be As activities million million to scope risk $XX capital and the discipline restart. a to capital decision package, we will will critical site focus will key the for thus XXXX. to continue we to in to for the to a construction adhere be on path far. support mobilization

annual goals on report quarter. of the team published XXth would initiatives. I we've touch progress and proud on sustainability to second made was very ESG like the Finally, in the I'm our for

a relative of XX% and gas with by of our to low business a our as employees members achieved to mitigate we usual change our in from with regard operations, We female as report the XX% target demonstrated to XXXX which our emissions board we highlights identifying by XX% our climate our emission countries communities as XXXX. of launched on are, Some surrounding intensity of in gender greenhouse local on basis, XX% from We peers. employees leadership strategy and and January our parity set operate. competitive, of employment local enhancing procurement

and over our our look stop continue we I'll on ways of financial mining foundation, sustainable things of will a practices. Phil challenge quo solid find to and results. we build the there turn forward, for status review As to

million, per adjusting expense debt QX shareholders one-time things, a everyone. deferred you, and translation, morning, financial attributable $X.XX After provides $XX or to the QX non-recurring adjusted items, related Slide share. of were redemption of net on loss Thank a related second earnings summary of revaluation other quarter or $X.XX tax reported results. a non-cash X the net for our George. exchange Good loss of among Eldorado per XXXX to foreign to $XX including million option derivative loss our share.

cash recovered costs performance second resulting of sold, per operational quarter, the ounce sustaining operating $XXX $X,XXX in Our all-in of costs in per sold. ounce and

half quarter production metal However, free mine second year, gold the and cash inventories, the the flow the increased annual of in lower royalty mainly due sales million, negative to was first and in payments costs. standby $XX

Cost half was of Skouries the impacted production sales mostly and by be third lower We the in to expect than higher including ounces. growth capital performance driven in first year capital. cash by spending, quarter free the flow planned additional

in We sold with the half expect year costs in to line be second basis ounce gold on lower of the production. higher a per

the charge halted We VAT into planned in was are seeing higher concentrate China, imposed of the to at a which import on result destination the costs shipments Russia as second XX% Olympias QX quarter in as sanctions. primary related were through shipments

reduced market July number effective to Electricity additional QX. prices average rising explore other markets QX compared of Greek the late in effort year, prices were which Rig following electricity A subsidies in XXXX the continue XXXX remain introduced XX% import to introduced Chinese electricity and measures War. mitigate at in We an price this Greece Russia, Ukraine charges. of by significantly in May the volatile. in to government the rose changes mitigate by to Olympias and in VAT

growth sold, per we As at $X,XXX between are ounce be sold. costs including ounce expected sustaining in costs XXXX and earlier, Capital Skouries. cash to all-in $XX of basis George $XXX to investment and $XXX with in mentioned revising $XXX sold, cost ranges, QX, were $X,XXX on ounce in Kisladag guidance a range costs expenditures consolidated per per total to million our the operating continued to cash projects $XXX operating

on to current and continue million sustaining license $XX Income our asset capital comprised to actively expenditures, expense production, our million million maintain focus in tax expense. integrity, $XX We and and operate. tax essential required of tax capital in deferred QX, expense to growth was review $X our

expense Türkiye, expense, driven local primarily current unrestricted At dividend deposits and we cash, the tax our the had equivalents In cash addition exchange withholding including tax tax the tax, profits weakening gains, Quebec of Euro. to term unrealized taxable currencies, Deferred quarter-end, was on and mining Lira of million. foreign duties. and mining by in $XXX

was levels cash half year of from Our cash a result impacted the and lower inventory. payments, capital by as and parts the production, lower spending, annual continued in of consumables operations generated first of royalty increased

to I XX, go X.XX This company for XXXX. QX years. improved With highlights. was at at over of it X.XX ratio will a operational end the Our turn times to as XXXX, the compared two over Joe profile that, credit times much June net now to through last reflects the the of leverage

improve culture highlight building a without good from a health Thanks, from and harm start frequency sustainable lost would total over half the quarter, on commitment a a to achieving Also, to with congratulate I'll continue our team rate our of focused Efemcukuru part We're time like a safety workplace. as zero I four safety our for In injury. year-over-year to operations. morning. years X.XX. to recordable our second injury X.XX Phil, and and we

of ounce Now cash with produced operating sold. the costs per moving to gold of XXX,XXX in ounces $XXX results, we quarter, operating second

in were performance from Olympias. meaningful second looks Slide by and increased Our our strong operations in the X that production Kisladag more in detail. quarter Türkiye, $XXX Starting in performance costs operational fewer than ounce at in tons first quarter, quarter driven Lamaque, improvements pad production per was sold. Efemcukuru the the placed planned cash quarter. ounces Oil were XX,XXX second the on leach lower was the operating and as during

ounces expected in half leach impact the to a quarter, operating third the grades, positively be During grinding impacted Cash in significant Optimization weighted in average anticipate was lower the of breakage the expected, in there by Kisladag pad the gold with belt with to which high to sold. production HPGR quarter. The quarter. second placed ounces quarter production pressure is mainly second performing better on improving Accordingly, with gold costs year. rates we according is roll higher in gold continued agglomeration increase were to the of second the as de-bottlenecking recovery and circuit liberation. of the model, particle the expected the

enhance leach are agglomeration handling of of the heap are North project, to over materials the materials circuit increase to the These in higher system. belt capacity handling us year. conveyors and expected in the pad part we a throughput Kisladag As allow balance investing

At safety sold. ounce Efemcukuru Gold of per in ounces production, first cash at production $XXX labor, and weakening are commissioned in and with second costs partially Lira. split offset site is We worth demonstrated gold Efemcukuru. was drum, be four to at product. plan noted It is agglomeration only half the improve ore product drum years a permeability and has installing expected to will as but the I Efemcukuru earlier, since proud a also the HPGR expectation, treat and and to consistency the the very agglomeration which of XXXX. The team. of also are re-emphasizing line XX,XXX by gold throughput cost I'm half production use site graded performance fine delivered increases the and of an quarter electricity the excellence has Efemcukuru, of XXXX. Not average for outstanding quality, consumables operating the team

of moving Now seeing the level are where robust Lamaque, also operational to performance. we same

resource drip, Ormaque Canadian quarter, in consumables very we very started continuous drilling ounce ounces early early Lamaque Cost QX. dollar. In costs for weaker Ormaque stages, the second the at improvement higher are and result increases higher gold were about from driven which $XXX a and is quarter second per grades. The planned quarter Underground was by of a second as was The as deposit. partially but of on than planned development still conversion Lamaque throughput production our progressed new was potential mill the It offset exploration deposit performance team high excited strong is validating production completed higher the cash gold by efforts. in the the And were and the XX,XXX was strokes mine well at slightly grade operating models. and in the sold. drilling future

are At move partially offset blast, with in import fuel was other weaker turn closing from resulting VAT, I'll grade Euro stop charges, continues the operating quarter resulting showing second to costs the were with Greece. Olympias, as Cost for focus. production Finally, and from initiatives per remarks. resulting cost it ounces, blasting there dilution were better results a and initiatives improve $X,XXX ounce positive productivity, mine and increases let's to back gold XX,XXX transformation sold. quarter. the electricity, cash to increases consumables gold Olympias George control by in

team. pleased in operations. performance global I'm with quarter strong Thanks our second the the across

strategy. impact and have we forward for Eldorado safe of Skouries from to value operating it remainder shareholders. delivering we the believe project to growth over profile your focused be execute our Skouries the on and XXXX, look as on will operator I results, a we for time. operating maximize on the our We continue to As de-risking analysts. our Thank transformative turn questions for 's now you will

the The Thank question you, [Operator begin Credit Instructions] from Suisse. now Fahad session. question-and-answer Please ahead. go will we comes Tariq first with

good me. Hi, morning, one just for

followed the beginning on complete longer? you other in On package be maybe a banks announce taking to the or are Skouries whether can it maybe detail expectations, of the there's maybe then hurdles forms hoping financing to just Thanks. financing? with financing example, some some of in will package, or by why bit and one process give be more for terms seems And stages, Greek you

Hi, it hear to from here. Phil Fahad, Good is you.

we the of package. with Greek been financing in obtaining towards banks obtain And Greek package, committee had then we've the banks soon. the two at The mean, we that lead bank I terms are process. to actively working RF Skouries can we've fairly approval. credit financing committee have we're In credit point looking discussions the that Greek to once And the actively start hope of approval,

are terms that say I well. it we And we've likely would I of I in think we're been QX. in pretty process, advanced. most discussions expect that communicating mean going

a a I process well think So process. advanced it's but it's progressing, it's

But Obviously, Yes, terms continuing is to from primary to be there's the just able other in end and restart pending in for low our our that. the supplement to on board place of attractive is I deliver that all alternatives. construction but we'll obviously that, unfolds. remain by of public that this very the focus update and year. guidance EU, get funding, Greek cost timing, the banks we George. it is And in both, financing financing the the as market we approval we'll RF effort are Skouries that the on confident thing

amount just of And from a there amount the maybe appetite you expect grid to like helpful. that's percentage then things? financing can of, And follow-up, the what yourselves? a give any the Okay, maybe total is what or you remaining fund

XX% now relief would to the Greek from the potential is that updating taken banks come be a then in focused are Eldorado funding bring XX%. the and percent European then equity potentially portion the bank Greek then package to step Union the So a financing JV be which on partner, that or of can project XX% the capital funding, remaining the would allocated next of

but be that balance I to believe sheet valuation to supplement it sheet with joint put Again, the strength those alternatives project bring to a decision that just the the the to continue on any of able and dependent have balance we've would life, security capital construction. into would on we we to venture got financing to in bring be partner we support investment the the so believe, multi-decade over focus mine the and

Okay, thank you.

there more As questions from question-and-answer phone today's call. Instructions] concludes no the and lines, [Operator this the conference session are

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