Taseko Mines, Ltd.

on your telephone. If your question has been answered and you'd like to remove yourself from the queue, simply press star 1-1 again. As a reminder, today's program is being recorded. And now I'd like to introduce your host for today's program, Brian Pergó, Vice President Investor Relations. Please go ahead, sir.

Thank you, John Evan. Welcome everyone and thank you for joining TSECO's first quarter 2025 conference call. The news release and regulatory filing announcing our financial and operational results was issued yesterday after market closed and is available on our website at tsecominds.com and on CDAR+. I am joined today in Vancouver by TSECO's President and CEO, Stewart MacDonald, TSECO's Chief Financial Officer, Bryce Hamming, and our COO, Richard Trombley. As usual, before we get into opening remarks by management, I would like to remind our listeners that our comments and answers to your questions will contain forward-looking information. This information by its nature is subject to risks and uncertainties. As such, actual results may differ materially from the views expressed today. For further information on these risks and uncertainties, I encourage you to read the cautionary note that accompanies our first quarter MD&A and the related news release, as well as the risk factors particular to our company. These documents can be found on our website and also on CDAR+. I would also like to point out we will use various non-GAAP measures during the call. You can find explanations and reconciliations regarding these measures in the related news release. And finally, all dollar amounts we will discuss today aren't Canadian dollars unless otherwise specified. Following opening remarks, we will open the phone lines to analysts and investors for questions. I will now turn the call over to Stewart for his remarks.

Great. Thank you, Brian. And welcome everyone to our first quarter conference call. As usual, I'll start with a business overview of our key activities and operational results in the quarter. And then turn the call over to Bryce for a more detailed review of the financial performance. So starting with Florence, our Florence Copper Project, we just issued a project update last week confirming everything is moving forward on time and on budget. Good progress continues to be made with construction activities at site and we remain on schedule to produce first copper before the end of this year. In the well field, as of this week, we only have two wells left to drill. So we have 88 out of 90 production wells completed and all 18 of the point of compliance wells are also done. We've ramped down to just one drill remaining on site and that one will be finishing up in the next few weeks. This is a great accomplishment as obviously the well field is a critical aspect of the overall project. In the SXEW plant area, we also have a lot of activity and progress and all critical path items are moving forward on schedule. The installation of the electro ruining crane was completed in Q1, which allows for the final wall and roof panels to be installed, completing the building structure. Current areas of focus include installation of electrical and piping equipment, completing completion of the substation facility, and ongoing work on the pipe corridor to connect the plant to the well field. In the coming months, as key systems are completed, progressive commissioning and testing will occur at the same time as the final construction activities. And in the fall, we expect to commence well field operations and initial injection, which sets us up for first copper cathode production before the end of the year. We continue to advance initiatives for operational readiness. Recruiting is going well. By next week, we'll have over 100 employees on site. We're also close to finalizing our first asset supply contract for the initial injection and pre-leaching period later this year. It's been 10 years since we've fired the Florence project and we're now less than nine months from producing first cathodes. It's been a long process to get where we are today, but I think the outcome is going to be well worth the wait for all our builders and other stakeholders. Florence is one of a few copper projects in the world currently under construction and it will be a major new supplier of refined copper cathode for the U.S. market. The potential for U.S. import tariffs on copper is further evidence of the unique value that we have in this asset. The COMEX copper price yesterday was about 14% higher than the LME price and the project has the potential to benefit from this premium in the future. Now on to Gibraltar where we produced 20 million pounds of copper in the first quarter to see one cost of $2.26 per pound. Copper sales of 22 million pounds at a realized price of $4.24 U.S. dollars per pound generated adjusted EBITDA of 34 million and cash flows from operations of 56 million. Mill throughput ran above design capacity at an average rate just under 88,000 tons per day. Head rate of .19% was in line with our expectations as a significant portion of the mill feed was from lower grade stockpiles as planned. However, copper recoveries dropped to 68% as the impact of oxidized ore was more significant than anticipated. So our overall production in the quarter was about 10% lower than we expected. Our original plan had higher grade ore coming from the deeper benches of the connector pit beginning in the second quarter after the initial waste stripping was completed. Unfortunately, challenging mining conditions at the top of the current connector pit pushback has impacted truck and shovel productivities so we will not get to the higher grades now until the third quarter. Second quarter production is expected to be similar to the first quarter and then we will see a step change of production in the second half with average grades above Gibraltar's reserve average and these good grades should continue into 2026. As a result of all this we expect 2025 production to be approximately 10 million pounds lower than our previous guidance of 120 to 130 million pounds. The refurbishment of Gibraltar's STTW plant and restart plants have made good progress and we expect first cathode production later in the second quarter. The plan is to produce about 3 or 4 million pounds of cathode this year. It will be a seasonal operation but a lot of copper oxide ore has been stacked and we expect the leach pad to run for many years into the future. Last but not least, a brief update on our Yellowhead Copper Project which we believe represents an important long-term growth option for the company. Continuing to work closely with BC government and CIMP First Nation on project permitting initiatives. The Yellowhead mine would be a major producer with 180 million pounds of copper production annually over a 25-year mine life. I would make it the second largest copper mine in Canada. We're planning to publish a new technical report this summer which will incorporate updated metal pricing, costing and then also the new Canadian tax credits are available for copper mine development and have the potential to positively impact the economics as well.

So with that I'll pass the call over to Bryce. Thanks

Stuart. Good morning everyone. I'll provide some additional color on our first quarter financial performance. For the quarter we sold 22 million pounds of copper at an average realized price of 424 per pound generating revenues of 139 million. As we fix most of our prices with our customers before ships depart we don't have a lot of QP price adjustments in the quarter or following the quarter end which helps us manage copper price volatility. We posted a gap net loss of 29 million or nine cents per share for the quarter. Lower quarterly production and higher costs were the main contributors to the loss as well as the 24 million unrealized derivative and fair value adjustment and that was from reversing the large market to market gain shown in December and this reversal was due to rising copper prices in Q1. On an adjusted basis after removing this unrealized loss we posted a net loss of seven million or two cents loss per share. Total site costs for the quarter were 107 million which is in line with previous quarters and is similar to our expectations on our quarterly run rate for the year. Capitalized stripping costs in the quarter were markedly higher at 38 million. This is attributed to the connector pit pushback and higher strip ratio of 4.6 to 1 which meant processing a much higher percentage of stockpiled material above the pit average strip ratio. These costs begin to taper in the second quarter. We don't expect much capitalized stripping in the second half as ore release increases from the connector pit. On a per unit basis costs in the quarter were $2.26 per pound of copper produced. This is lower quarter over quarter and year over year as a result of the higher stripping costs I mentioned but also lower TCRCs which now average to a nominal amount for this year under our new favorable off-take contracts. We also saw increased minimum sales volumes and a stronger US dollar in the quarter and that was offset by our lower production. Adjusted EBITDA in the first quarter was 34 million lower than previous quarters and again due to the decreased production sales volumes. At Florence we incurred a total of 57 in US dollars of costs in the quarter and most of that was directly related to the commercial facility construction as well as six million that was associated with site operations and completion of the rinsing tests which we are finishing up this quarter. Given we are now 80% complete construction capital spending will begin to taper down going forward as the peak spending is behind us. Today we have incurred 206 million of the construction capital. We continue to expect final capital to be within 15% of our 2023 estimate of 230 million. We ended the quarter with 121 million of cash and we have available liquidity at the end of the quarter of 279 million after factoring in our undrawn revolving credit facility. We did draw 25 million against this credit facility after the quarter had to support working capital. Finally given volatility in copper just want to highlight in addition to fixing our prices at the time of shipment we also have our price protection for the year. It covers the balance of the year and it protects a four dollar per pound minimum four place for most of our production for 81 million pounds. These are callers and they're based on LME prices and they cover the next three quarters and that gives us all the upside up to 540 per pound. So with that I'll turn it over to the operator. Thank you.

Certainly and as a reminder ladies and gentlemen if you do have a question at this time please press star 1 1 on your telephone. Our first question comes from the line of Craig Hutchinson from TD Cowan. Your question please.

Hi good morning guys thanks for taking my question. I'm just wondering if you could provide some more context on the issues you're encountering in Gibraltar with respect to the ground conditions. You know what are some of the issues is it just maybe smaller trucks or just any context on that and when you expect to be through that?

Yeah Craig Richard here. So the upper bench is in connector pit with pioneering and kind of set up mining. We're all around the overburden that had to get mined out before we could access down in the coffin rock and that overburden proved to be a lot more challenging than was originally envisioned and required a lot of rock to be basically placed in improving ground conditions to allow the equipment to access the dig face as well as the dump. Properly we've progressed through that and are now seeing you know our expectations on the mining are kind of being met now so but it has delayed us in

Q1. Okay and then the issues around the

oxidized stockpiles will that be a factor again in Q2? Should we assume recoveries are for the customer to Q1? Both grades and recoveries I guess?

Yeah and that's why I think as Stuart indicated production levels will be comparable to Q1 so that's been kind of factored into that forward look and the you know the reduction of guidance for the year essentially.

Okay

great

thanks and then there's some Florence I know Gibraltar is overseas at Florence any sense in terms of what that might have an impact whether it's on you know finishing the capital here or just on cost going forward or what's most sensitive in terms of cost at Florence with regards to tariffs?

Thanks. Hi Craig it's Stuart here in terms of the capital project you know there's no impact from any import tariff and I guess the reason for that is because we've got all of our supplies and equipment already inside the U.S. mostly at mostly already on site or else a few things at other fabricators in the U.S. so that's not an issue at all. You know speaking about longer term operating costs obviously it's a pretty volatile environment with the tariff picture still in flux and changing every couple weeks so wouldn't want to make any comments about you know what our impact might be in 26 or 27 but yeah it's you know we'll do something we're just monitoring. Obviously the biggest input cost or operating cost going forward will be sulfuric acid. You know that's a lot of that is also sourced from within the U.S. so that's probably as much as much as I would say on it at this time. Okay thanks guys I'll jump back into

you.

Thank you and as a reminder ladies and gentlemen if you do have a question at this time please press star 1 1 on your telephone.

And we've got a follow-up from the line of Craig Hutchinson from TD Cowan. Your question please. Any updates

on new prosperity? Any kind of plans to kind of

beyond what we've kind of disclosed that you know we've made very good progress there. It's been a constructive dialogue and we think we're close to a resolution but no yeah nothing that I can really say beyond that but it's

looking

positive.

Okay all right thank you guys. Certainly thank you and

this does conclude the question and answer session of today's program. I'd like to hand the program back to Toseco Mines Management.

Great okay thanks everyone. Well yeah we'll wrap up the call here and obviously if there are other questions feel free to reach out to us and otherwise we will talk to you next quarter. Thank you.

Thank you ladies and gentlemen for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.