SilverCrest Metals Inc.

Good morning, ladies and gentlemen, and welcome to the Silvercrest Report's first quarter 2023 results conference call. At this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Friday, May 12, 2023. I would now like to turn the conference over to Eric Fierre. CEO and Director. Please go ahead.

Thank you, Operator. Good morning, and thanks, everyone, for joining the first quarterly earnings call as a precious metal producer. Today, we'll be providing commentary on our first full quarter of production, after which we'll be happy to take questions. The slide deck we'll be referring to is available on our website at silvercrest.com. metals.com under the investor tab. Before we get started, I'd like to direct you to the forward-looking statement on slide two. All figures discussed this morning are in U.S. dollars unless otherwise stated. On the call with me today are Chris Ritchie, President, and Pierre Boudoin, Chief Operating Officer. Let's start with slide three. Q1 marked our first full quarter of commercial production. We have focused on ramping up, gaining further confidence with operations, generating free cash flow while reducing operational and financial risk. Our early ramp-up success coupled with our robust cash position has allowed us to accelerate debt prepayments, which significantly de-risked our balance sheet. The Las Chispas operation continues to perform well with the processing plant meeting or exceeding design parameters. Also, one of our biggest success stories to date is how our stockpiles have continued to create value and reduce risk. The underground mine ramp-up is progressing as per updated rates. Completion of the updated technical report some like to refer this to the updated feasibility study, remains on schedule for late Q2. This report forms the basis for future production and cost guidance. We will continue to advance our ESG initiatives including a strong focus on health and safety as well as risks and opportunities within the community in which we operate. The second year of our water stewardship plan in the local communities, which is based on the findings of our TCFD work, is progressing nicely and we remain on track to deliver our inaugural ESG report in Q2. We are also very proud to announce that we recently received a notable ESG award in Mexico. and we look forward to continuing with this momentum. I will now pass the call to Chris to discuss financial results for the quarter.

Thanks, Eric. Moving to slide four. In the quarter, we generated revenue of $58 million. Cost of sales were $22.4 million, reflecting a mine operating margin of an impressive 61%. That income in the quarter was $27.2 million or $0.18 per share. It is important to note that our results in the quarter benefited from access to our surface stockpiles, which carry a lower cost per ounce than those currently being mined, as well as from tax loss carry forwards. We expect these benefits to continue through 2023. Net free cash flow was $19.3 million for $0.13 per share. In November 2022 we restructured our debt facility which lowered our interest costs and improved the terms. At that time, we repaid $40 million from cash that was available to us based on an on time and on budget build. The prepayment of an additional $25 million was made in Q1 was supported by strong free cash flow. This is the best way to prove that the mine is operating successfully. Subsequent to quarter end, we have prepaid a further $20 million of debt based on continuing strong cash flow generation. This reduces our total debt outstanding to $5 million. We have now repaid 95% of our debt within six months of declaring commercial production, a significant accomplishment in a short period of time. We forecast that this early prepayment of debt has reduced our interest costs by approximately $6 million. We ended the quarter with $45.8 million of cash and cash equivalents and an undrawn $70 million revolving credit facility. With that, I will now pass it to Pierre to discuss operations at Las Chispas.