Hycroft Mining Holding Corporation

Good day and thank you for standing by. Welcome to the Highcroft First Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone. Please be advised that this conference is being recorded. If you require any further assistance, please press star zero. I would now like to hand the conference over to your speaker today, Ms. Tracy Tom, Vice President, Investor Relations. Please go ahead.

Thank you so much. Good morning. Thanks, everyone, for joining us today. Today we will be discussing our first quarter 2021 results for which we filed our Form 10-Q with the Securities and Exchange Commission and issue a press release this morning. The press release can be found on our website at www.highcraftmining.com. Please read the press release and listen to this call in conjunction with reviewing the Form 10-Q, which contains additional disclosures. Also, please note that some information provided during this call may include forward-looking statements that involve risks, uncertainties, and assumptions. Even if the risks or uncertainties have been materialized or the assumptions proven correct, these results may differ materially from those expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be deemed forward-looking. A discussion of some of the risks, uncertainties, and assumptions are set forth in more detail on our press releases and SEC filings, including the most recently filed 10Q. We assume no obligation and do not intend to update any such forward-looking statements. I'll now turn the call over to Diane Garrett, President and CEO.

Thank you, Tracy. Good morning, everyone, and thank you for participating on our call today. I'm Diane Garrett, President and CEO of Highcroft Mining. Along with Tracy, others that are on the call today are Jack Henriss, our Executive Vice President, Chief Operating Officer, Stan Rideout, our Executive Vice President and Chief Financial Officer, and Mike Eislein, our Vice President and General Manager. After my initial remarks, I'll then ask Stan Rideout to review the highlights of the first quarter financials, and then followed by Jack Henriss, who will provide a brief operational update. After that, we will open the call up for questions from our audience. First, I'd like to congratulate the entire HICROF team for their dedication to improving our health and safety culture at HICROF. When I joined last September, our total reportable incident frequency rate, otherwise known as TRIPR, was well above the industry average. We've worked diligently with a top-down approach to institute and improve our safety culture in addition to our corporate work culture overall. With additions to the operating team at site and at the corporate level, combined with a motivated workforce, we saw the benefits of that work very quickly. And by the end of 2020, we saw more than 50% reduction in that tripper rate and a significant decline in the frequency and seriousness of incidents. As we all know, safety performance leads to less incidents, which leads to operational efficiencies and productivity. We've continued seeing improvements into the first quarter of this year with another decrease in our TRIPR rate, which now places us below the industry average of 1.22. And I'm extremely pleased to report that the trend continues. And as of April, our TRIPR rate is 0.93. In addition, operating performance is at the best level since the restart of operations in 2019. In addition to all of these improvements, from safety to culture to operating performance, we've achieved a number of goals during the first quarter, and I'd like to discuss those with you now. First of all, production and sales were well above plan due to improvements made by our process group and the solution management system, and increasing the brimstone Merrill Crow throughput, which improved our recovery of metal from the solution. Our drill rigs began turning in March 2021 as planned, with the task of obtaining the metallurgical samples for our previously reported variability test work program. As we discussed in our last call, this program is critical to completing the database of information so that we know how each geologic domain will perform under the two-step novel sulfide oxidation and heap leach process. While there was a lot of good work done in the past, there were just some gaps we identified, and so we want to mitigate any potential startup risk by completing that database of information. We have significantly advanced the oxide and transitional material run-of-mine plan, which is what we're operating under at the current time. We have approximately 50, 500, million tons of ore of run of mine material, which represents about 450,000 ounces of gold and 18 million ounces of silver. That material is currently accessible and our existing leach pad has about 34 million tons of run of mine capacity available. Between the 34 million tons of current pad capacity and the 50 million tons of run of mine material, we can also utilize the new leach pad if necessary for this run of mine material and or the sulfide material when we begin accessing commercial scale sulfides in 2022. While we did continue to experience COVID-related workforce shortages that affected our ability to achieve our targeted mining rates during the first quarter, we're working to make up for those shortfalls. And at this time, we do not expect any impacts to our full year 2021 production and guidance outlook for gold sales. For this quarter, it is business as usual with optimizing our mine plans and performing the drilling necessary to complete the variability work for the sulfide oxidation process. Everything remains on track and on budget. Our goals for this year are multifold. First, we are working our team with Forte Dynamics toward a goal of being cash flow positive from our run-of-mine heat bleach operation. Our team is moving into the final stages of the mine plan optimization and scheduling with the current 50 million tons of run-of-mine material and more that we expect to encounter throughout our mining operations. We hope to achieve a base operation that is cash flow positive as we bring on the sulfide material to be processed under the two-stage process during 2022. Second, we are completing the necessary design work that we previously mentioned on the two-stage novel sulfide oxidation process, such as designing the solutions management system, heat stacking design, and forced air injection design. As I mentioned earlier, we're on track with the drilling for the representative samples across the entire deposit to complete the variability work and preparation and planning for this commercial scale sulfide production. Third, as we discussed on our last call, with total resources of 21 million ounces of gold and over 700 million ounces of silver, we feel it is prudent to at least look at the option for treating higher grade sulfide ores, which we have identified within the deposit, through a small mill. If we determine that additional value can be obtained by processing some portion of the sulfide through a mill, we have the flexibility and timing of bringing a mill online because we have the majority of the permits in hand and because the mills and motors are in storage. If a mill is determined to be a significant contributor to the overall value of the mine, we could bring it on in year three or four or five or even later. In other words, we have flexibility if and when a small mill may make sense. Because we have all of the equipment, we don't have the pressure of needing to spend the capital on long lead time items. So this is a very big benefit. Moreover, as I mentioned earlier, we are fully permitted for the mill operation and for a tailing stand. We're doing that work right now with the Cinco Engineering to see what the taking the previously existing feasibility study on the mill and wrapping in current economics on it. Fourth, For this year, our new team's deep dive into the existing drilling information has identified several areas of high-grade sulfide mineralization, and we're following up on these target areas while we have the drill rigs on site. So they're going to be performing a dual purpose this year. While we have a lot of work to do during the year, we have a team that's certainly up to the pass. This is what we do. We take projects up the value chain for all shareholders by reducing startup risk and optimizing the approach to mine planning and processing. We envision Highcroft as having a solid base run of mine heat bleach plan while we introduce the sulfide oxidation processing and possibly at some future point introduce a small milling component. As we've talked about before and in the past, this multi-stream processing design is very common in Nevada for these types of large deposits. So rarely in our area is it a one-size-fits-all approach. But we've also talked to you before about how the ore body tells you how to process each geologic domain so that it yields the best value for all of our shareholders. On a final note before I turn the conversation over to Stan Rideout, We remain very disappointed in our share performance, but we also believe these are compelling buying opportunities for such a large world-class mineral endowment. We had one seller following our last earnings call who had been in the stock for a while, and that continued to put pressure on our stock. We do see selling by other entities, and I know many of you have phoned me about that. They have reported to me that they're closing and or realigning portfolios, and while they remain shareholders of High Crop with significant positions of our stock, They also have to liquidate some holdings in those funds that are being closed. And we anticipate and hope very soon this selling will be nearing the end. So we have a very busy year ahead of us, and I'll provide some closing comments shortly. But for now, I'll turn it over to Stan Rideout, our CFO, to walk us through the financial summary. Stan?