New Gold Inc.

Good morning, my name is Vincent and I'll be a conference operator today. Welcome to the new Gold's fourth quarter and full year 2020 for earnings call and webcast. All lines have been placed on mute to prevent any backhoe noise. Please be advised that today's conference call is and webcast is being recorded. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star, then the one on your telephone keypad. If you would like to withdraw a question, please press the star, then the number two. I would now like to hand the conference over to Ankit Shah, Executive Vice President of Strategy and Business Development. Thank you. Please go ahead.

Thank you, Vincent and good morning, everyone. We appreciate you joining us today for New Gold's fourth quarter and full year 2024 earnings conference call and webcast. On the line today, we have Patrick Waden, President and CEO, and Keith Murphy, our CFO. In addition, we have Luke Buchanan, Vice President, Technical Services, and Jean-Pierre Rabineau, Vice President, Geology, available to assist during the question and answer portion of the call. If you wish to follow along with the webcast, please sign in from our homepage at newgold.com. Before the team begins the presentation, I would like to direct your attention to our cautionary language related to four looking statements found on slide two of the presentation. Today's commentary includes four looking statements relating to New Gold. In this respect, we refer you to our detailed cautionary note regarding the four looking statements in the presentation. Precaution that actual results in future events could differ materially from those expressed or implied in four looking statements. Slide two provides additional information and should be reviewed. We also refer you to the section entitled risk factors in New Gold's latest annual information forum, MDNA, and other filings available on CDAR+, which set out certain material factors that could cause actual results to differ. In addition, at the conclusion of the presentation, there are a number of end notes that provide important information and should be reviewed in conjunction with the material. Slide four highlights some of the key accomplishments of 2024. We accomplished a lot of our objectives we laid out at the start of the year. By prioritizing health and safety through our courage to care culture, we delivered a low tripper and continued to improve year over year. The company produced just under 300,000 ounces of gold and 54 million pounds of copper at an -in-sustaining cost of $1,239 per ounce, eating the low end of our -in-sustaining cost guidance range. This strong cost discipline led to increasing margins and delivering cash flow from operations of over 390 million and free cash flow of 85 million. Throughout the year, we successfully delivered on key project milestones. At New Afton, we achieved commercial production at C-Zone and commissioned the crusher and conveyor systems. At Rainy River, we mined the first development ore from the underground main zone. These milestones were accomplished on budget and ahead of schedule. Last week, we released updated technical reports for both assets. These reports incorporated mine-like extensions at both sites and increased our underlying net asset value. Our exploration efforts throughout the year successfully replaced mining depletion of reserves on a gold equivalent basis. We plan to maintain this momentum in 2025 to unlock additional long-term value. Finally, in May, we increased our exposure at New Afton to over 80 percent, following the transaction with Ontario teachers, reducing their free cash flow interest from 46 percent to 19.9 percent. 2024 successfully positioned our company and we look forward to building on this in 2025 to create significant value for our shareholders. With that, I will turn the call over to Keith. Thank you, Angus.

I'm on slide six, which has our operating highlights. Q4 production was pre-released back in early January, but it's worth reiterating certain points. Q4 delivered the highest production and lowest cost of the year. Production totaled approximately 80,400 gold ounces and 14.5 million pounds of copper. Increase in gold production compared to the third quarter was driven by higher feed grades at both sites. Consolidated all-in sustaining costs for the quarter were $1,018 per ounce, a decrease of 15 percent over the third quarter. This is highlighted by strong cost performance at both operations, with Rainy River continuing to decrease its all-in sustaining costs, and New Afton achieving an all-in sustaining cost of negative $540 per ounce after considering the copper credits. Despite the slight missing gold production compared to our updated guidance, strong cost management and discipline allowed the company to beat the low end of its original 2024 consolidated all-in sustaining cost guidance. Our total capital expenditures for the quarter were $75 million, $10 million spent on sustaining capital, and $65 million on growth capital. At Rainy River, sustaining capital is primarily related to capitalized waste and tailing samples. Growth capital for the full year is related to the underground development as the underground main and trepid zones continue to advance. All-year total capital is below the 2024 guidance range of $145 million to $165 million due to efficient capital management, savings related to the execution of the Rainy River tailing stamp raise, and lower capitalized waste stripping, with approximately $5 million of growth capital deferred into 2025. At New Afton, sustaining capital is primarily related to continuation of the tailings management and stabilization activities. New Afton growth capital is primarily related to sezone underground mine development and cave construction. All-year total capital is below the 2024 guidance range of $145 million to $165 million, with approximately $15 million of capital deferred into 2025. I'll touch on operations starting with Rainy River on slide 7. Gold production in the fourth quarter was impacted by unexpected mechanical downtime on the crushing conveying system in December. Despite the lower gold production, the team did an excellent job to control costs. All-in sustaining costs were $1,327 per ounce for the fourth quarter, which resulted in the operation achieving the original full-year all-in sustaining cost guidance range. This is an impressive effort from the team and resulted in $90 million of free cash flow generated in 2024, while setting up the operation for a sustained period of free cash flow generation. Turning now to New Afton on slide 8. New Afton delivered another strong operating quarter with an increase of 19% gold production and 15% copper production over the third quarter. The B3K performed as planned and sezone ore production is ramping up following commercial production and cursor commissioning early in the fourth quarter. Gold production beat the top end of the original 2024 guidance range, with copper production achieving the midpoint. All-in sustaining costs for the quarter and the year decreased substantially compared to the prior year period, driven by lower operating expenses, lower sustaining capital spends, and higher byproduct revenues. As a result, full-year all-in sustaining costs per gold ounce sold was well below the 2024 guidance range. The operation generated $24 million of free cash flow while completing the key infrastructure required to enter a period of sustained free cash flow going forward. Both operations exit 2024 well positions to generate significant free cash flow. A wrap up with our financial results on slide 10. Fourth quarter revenue was $262 million, which is a quarterly record. Q4 revenue was higher than the prior year quarter, primarily due to higher metal prices and higher copper sales, slightly offset by lower gold sales. Cash generated from operations before working capital adjustments was $126 million, or $0.16 per share for the quarter, higher than the prior year period, primarily due to higher revenues. New gold generated quarterly free cash flow of $22 million, due to higher revenue, partially offset by higher capital expenditures in the quarter, as key growth project milestones were achieved. Company recorded net earnings of approximately $55 million, or $0.07 per share during Q4, and increased due to higher revenues. After adjusted for certain other charges, net earnings were $59 million, or $0.07 per share in Q4, a significant increase compared to an adjusted net loss of $5 million in the fourth quarter of 2023. Our Q4 adjusted earnings include adjustments related to other gains and losses. At the end of Q4, we had cash on hand of about $105 million and a liquidity position of $482 million with the credit facility undrawn. In the second half of 2024, we repaid the entirety of the $100 million drawn on the credit facility related to the Ontario Teachers Buyback Transaction with cash on hand and during a capital intensive period for both operations. This is made possible by the operational excellence and cost discipline both of our sites showed during the year. Sum up, we remain in a very

healthy financial position. With that, I'll turn the call to Pat. Thanks, Keith. Glad you never summarized our three years outlook

we

released

last week. We expect continued and think and growth in gold and copper production over the next three years. Both operations are currently doing to increase with the realization of that were completed in 2020. The gold production is expected to increase from 300,000 ounces in 2024 to a midpoint of 410,000 ounces in 2027. 30% increase over three years. Copper production is expected to increase from 54 million pounds in 2024 to an impressive 405 million pounds in 2027. 90% increase over that period. The increasing production between cash for ounces of gold are expected to be reduced significantly. By 2027, the consolidated all in sustaining costs is expected to be $400 to $500 per gold ounces, a 64% reduction compared to 2024. Altony and cross-checking costs are expected to taper off significantly over the next three years. This probably due to the reduction in shipping at Reddy River. 2025 estimates consider the carryover of some capital that was not spent in 2024. With the increase in production combined with the reduction in unit costs and tapering capital costs over the next three years, the company is well positioned to deliver significant free capital. Based on our updated outlook, we expect to generate significant free cash flow over the next three years following the infection point reached in mid 2024. At current consensus community prices, this translates to over $1.7 billion in free cash flow over that period. At current spot price, the figure exceeds $2 billion U.S., over 80% of our market cap. At new after 2025, production will look a lot like 2024 as we continue transitioning from the B3 cave to the C-Zone cave. Total gold production for the year is expected to be 60 to 70,000 ounces, while copper production is expected to be 50 to 60 million pounds. These own mining rates will continue to ramp up throughout the year towards 16,000 tons per day. The increased rate is partially offset by lower grades as B3 cave is exhausted in the first half of 2025, and C-Zone rates gradually increase throughout the year. Production is expected to significantly strengthen in the second half, with the first quarter representing approximately 20% of the annual production, again driven by lower grade as B3 nears the end of cave lives. Main river is expecting gold production of 265 to 295,000 ounces for the year, a 20% increase compared to the 226,000 ounces produced in 2024. The increase is driven by a 20% to 25% increase in gold rate as the underground mining rate increased during the year. Approximately 11% of production is scheduled in the first quarter and 37% in the first half of the year. This is due to the open pit mining sequence. We are currently completing with stripping in phase 4 and will primarily process lower grade 5,000 tons in 2021. From Q2 onwards, we will release higher grade, low strip ratio ore from the open pit. For the same reason, sustaining capital is weighted for the first half of the year. The underground mine is well positioned to deliver 846,000 ounces in 2025 as a result of the development completed in 2024. Lateral development is consistent throughout the year. Gold capital allocation is higher in the first half of 2025 due to commissioning the fresh air raise funds which will be completed in Q2 of this year and the purchase of mobile equipment. In closing, 2024 was a challenging year but an important year. In 2025 will be another important one. We will continue to deliver on our stated strategic goals. This includes delivering on 2025 production and cost guidance with the same attention to health and safety. Support from our employees for the Co-HRJ2Care program has contributed significantly to our health and safety performance since I joined the company. At New Afton, we will ramp up season and advance the development of East Extension. At Renim River, we will continue to ramp up the underground mine and advance phase five open pit development. We will continue to increase our exploration effort at both sites targeting future reserve replacements. We have entered in a very exciting time for new gold with increasing production and synchron free capital generation in a robust community cycle. Combined with our safe, well established mining jurisdiction and exposure to what we view as our preferred metals in gold and copper, New Gold offers a compelling investment opportunity. I strongly believe we have a team dedicated to value creation as demonstrated last week with the delivery of two new technical reports and mine life exceptions at both of our assets. 2025 will be a busy year, but we look forward to building on free cash flow and collection points achieved in 2024 to create value for our company, our stakeholders, my teammates, and our shoulders.

With that, we will open the floor up to questions. Thank you, ladies

and gentlemen. We will now begin question and answer session. Should you have a question, please press star followed by the one on your touchtone phone. You will hear a prompt that your hand has been raised. If you wish to decline from the polling process, please press the star followed by the two. If you are using speakerphone, please lift the handset before pressing any keys.

One moment for first question. Your first question comes from Eric Wendel. Please

go ahead.

Good morning, Pat and team. Thanks a lot for taking my question. Nice to see the company generating cash flow here despite investing in the assets. Just a question on Rainy River. I want to follow up from the tech session and again the MD&A. You talk about the opportunity for additional pit push backs with minimal drilling there. Just wondering what you need to see or how those might ultimately get into the mine plan. Any call would be appreciated.

Thanks. Thank you for that. As we present the phase five with an extension to the west side of the pit, we are actually drilling the northwest trend with an extension to the west of the New York body. We are currently doing this. It's an opportunity for us to extend the mine life. We also can extend the phase six with some of the pits. It's depending on a few things. We have the drilling that is mostly completed there. It will be driven by the whole price for sure. But also we have to complete the next step. We need to confirm the ultimate capacity of our drilling storage facility. One percent of the technical report is something that is fully attached and feasible. If we want to extend or push back the pit, we have to determine our capacity to handle the tailings by itself.

It's something that we are currently working on. Fantastic.

I really appreciate that. Just a question. As we look at it in 2025, the back half is setting up pretty strong. Q1 is going to be lower production. Any comments on the cost and how we should think about on sustaining costs throughout the early quarters of the year?

Similar with the production profile that Pat outlined, we expect the second half of the year to be stronger. We expect our cost profile to follow that. It will be decreasing towards the end of the year as

our production profile increases. That's helpful. I appreciate the added color. I will hop back into the queue. Cheers. As a reminder, if you wish to ask a question, please press star 1 on your telephone keypad. If there are no further questions, please continue.

Thank you, Vincent. Thank you for everyone who joined us today. As always, should you have any additional questions, please do not hesitate to reach out to us by phone or email. Have a great day.

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.