Alamos Gold Inc.

This conference is being recorded. Cette conférence est enregistrée. All participants, please stand by. Your conference is ready to begin. Good morning, ladies and gentlemen. I would now like to turn the meeting over to Scott Parsons, Alamos Senior Vice President of Corporate Development and Investor Relations. Please go ahead, sir.

Thank you, operator, and thanks to everybody for attending Alamos' third quarter 2025 conference call. In addition to myself, we have on the line today John McCluskey, President and Chief Executive Officer, Greg Fischer, Chief Financial Officer, and Luc Guimond, Chief Operating Officer. We will be referring to a presentation during the conference call that is available through the webcast and on our website. I would also like to remind everyone that our presentation will be followed by a Q&A session. As we will be making forward-looking statements during the call, please refer to the cautionary notes included in the presentation news release and MD&A, as well as the risk factors set out in our annual information form. Technical information in this presentation has been reviewed and approved by Chris Boswick, our Senior VP Technical Services, and a qualified person. Also, please bear in mind that all of the dollar amounts mentioned in this conference call are in U.S. dollars, unless otherwise noted. Now I'll turn it over to John to provide you with an overview. Thank you, Scott.

Starting with slide three, before we go into the report for the quarter, I want to acknowledge that this has been far from a typical production year for Alamos. We experienced production downtime and lower production the first half of the year, which we were on pace to make up in the second half. Unfortunately, in recent weeks, downtime at the Maginot Mill and a seismic event at Island Gold will not give us the time to do so. As a result of these recent events, We've taken the prudent course and lowered guidance for the year by 6% from the midpoint of our original guidance. We have a reputation for taking a conservative approach to guiding the market, and we pride ourselves on providing consistently accurate guidance. Suffice to say, we will continue to make operational improvements to raise the accuracy of our forecasting, recognizing that occasionally mining can be unpredictable. It remains to be said that while these recent events have a short-term impact, they in no way take away from the quality of our mines and what is without question one of the strongest outlooks in the gold sector. We are already seeing significant improvements this month with better grades at Young-Davidson and throughput from the mines. This will ultimately support lower costs and an 18% production increase, leading to record production in the fourth quarter. Production in the third quarter totaled 141,700 ounces, a 3% increase from the second quarter, driven by stronger performances from Mulatto's and the Island Gold District. This was slightly below the low end of quarterly guidance, reflecting one week of unplanned downtime within the Maginot Mill during the last week of September. Reflecting lower costs from the Mulatto's District, total cash costs decreased 9% from the second quarter, and all in sustaining costs decreased 7%, both consistent with guidance. With higher production, a record gold price, and lower costs, we delivered record revenue, cash flow from operations, and record free cash flow of $130 million in the quarter. We expect a significant improvement in both our fourth quarter production and costs to drive new financial records at current gold prices. Turning to slide four, the majority of the third quarter we were on track to achieve our full year production guidance. Given the unplanned downtime of the Maginot Mill in the last week of September and the seismic event at our Island Gold operation in October, we're decreasing our 2025 production guidance to between 560 and 580,000 ounces. This represents a 6% decrease from our original guidance released in January. Late in September, a capacitor failure within the Maginot mill impacted the electrical drive for the Sagan ball mills. This led to one week of downtime and lower third quarter production than originally expected. The mill was restarted by the end of September and continues to demonstrate improvement in October. Due to the unplanned downtime, Island Gold's mill was restarted in late September to focus on processing higher grade underground ore. Given the record gold price environment, We will continue running both mills through the remainder of the year with the increased combined milling capacity supporting additional gold production, higher cash flow, and increased profitability. In mid-October, Dow and Goldmine experienced a seismic event, which is a normal part of operating an underground mine. No personnel or equipment were impacted, and mining rates are expected to continue within budgeted levels. However, this has delayed access to higher grades within one of our mining fronts. As a result, mine grades are expected to be lower than budgeted for the fourth quarter. Even with the lower than planned underground grades in the fourth quarter, we expect a substantial increase in production from Island Gold District, driven by higher combined milling rates. We expect similar increases at Young-Davidson, driven by higher mining rates and grades. and at Mulatto's with the recovery of higher grade ore stacked over the previous two quarters. All three operations are expected to contribute to an 18% increase in the fourth quarter production at lower costs, driving a further increase in free cash flow at current gold prices. Turning to slide five, short-term challenges we experienced this year have no impact on our strong long-term outlook, which remains firmly intact. The phase three plus expansion at Island Gold will be a key driver of our growing production and declining costs over the next several years. The expansion is progressing well and with expected completion in the second half of 2026. The Lynn Lake project is another important part of our organic growth. Forest fires in northern Manitoba limited our progress on this project this year, but we expect to ramp construction activities in the spring of next year. and initial production is now expected in 2029. This puts us on track to reach 900,000 ounces of lower cost annual production by the end of this decade. The Island Gold District expansion study currently underway is expected to outline further upside with the potential to increase consolidated production to 1 million ounces per year within a similar timeframe. We generated year-to-date free cash flow of nearly $200 million in 2025 and expect to generate growing free cash flow as we execute on this growth. Following the start-up of Lynn Lake, we expect to generate more than $1 billion of free cash flow annually at current bull prices. Looking at slide six, in addition to delivering on our organic growth plans, we continue to surface value from our portfolio of assets. This included announcing the sale of our Turkish development projects for a total cash consideration of $470 million. The transaction closed earlier this week and marks a positive outcome, realizing significant value for assets we had written off in 2021. We received $160 million on closing and the remainder $310 million will be received over the next two years. With our strong free cash flow during the third quarter and initial proceeds from the sale of our Turkish assets, our current cash balance has increased to over $600 million. We will be using the proceeds from the transaction and growing cash position to reduce our small debt position and we expect to be active on our share buyback. We were also recognized for the second consecutive year as a TSX 30 winner by the Toronto Stock Exchange for our strong share price performance of 310% over the trailing three years. The award is a testament to our long-term track record of outperformance, something we expect to continue to build upon as we deliver on our upcoming catalysts and organic growth plans. I'll now turn the call over to our CFO, Greg Fischer, to review our financial performance.

Thank you, John. On to slide 7, we sold approximately 136,500 ounces of gold in the third quarter at an average realized price of $3,359 per ounce for record revenues of $462 million. The average realized price was below the London PM fixed for the quarter, primarily due to the delivery of over 12,300 ounces into the gold prepaid facility at a fixed price of $2,524 per ounce. We will deliver the same number of ounces in the fourth quarter, after which the prepay obligation will be completed. As a reminder, the prepay facility was executed in July 2024, with the proceeds utilized to retire 180,000 ounces of forward sale contracts inherited from Argonaut Gold across 2024 and 2025, with an average price of $1,840 per ounce. Based on an average gold price of almost $3,000 per ounce since July 2024, the company increased cash flow by approximately $40 million over that period, given the decision to buy out the 180,000 ounces of hedges 15 months ago through the execution of that prepaid facility. Quarter over quarter, total cash costs and all sustaining costs decreased 9% and 7% respectively, and both were in line with quarterly guidance. We expect total cash costs and all-in-sustaining costs to decrease a further 5% in the fourth quarter, driven by higher production across all operations. We remain on track to achieve full-year cost guidance, which was revised earlier in the year. We are now reporting total cash costs and all-in-sustaining costs, excluding the impact of mark-to-market adjustments for the revaluation of previously issued share-based instruments. This methodology provides a better representation of our total costs associated with producing an ounce of gold and eliminates volatility associated with mark-to-market adjustments. These mark-to-market adjustments to long-term instruments impact both total cash costs and all sustaining costs, given the company allocates these costs to mining and processing costs and share-based compensation expense on the income statements. Our reported net earnings were $276 million in the third quarter, or 66 cents per share. This included $193 million reversal of a previously recognized impairment related to the Turkish projects, as well as unrealized losses on hedge derivatives, foreign exchange impacts, and other adjustments totaling $72 million. Excluding these items, adjusted net earnings were $156 million, or 37 cents per share. Operating cash flow before changes in non-cash working capital was a record $275 million in the third quarter, or $0.65 per share. Capital spending totaled $135 million and included $35 million of sustaining capital, $83 million of growth capital, and $17 million of capitalized exploration. Our consolidated 2025 capital guidance has been updated to between $539 million and $599 million, a 10% decrease from previous guidance, primarily reflecting lower spending at Lynn Lake, with the ramp of construction activities shifting to 2026. Free cash flow for the quarter totals a record $130 million, a 54% increase from the second quarter, driven by record contributions from all three operations. This includes $73 million from the Mulatto District, $72 million from the Island Gold District, and $62 million from Yonge-Davidson. Our cash balance grew 34% from the end of the second quarter, to $463 million. Subsequent to quarter end, we received initial cash payments totaling $163 million from the sale of both our non-core Turkish development projects and the Quartz Mountain project, bringing our total cash position to over $600 million currently. Combined with the undrawn balance on the credit facility, our total liquidity is over $1.1 billion. We expect growing production and declining costs to drive increasing free cash flow over the next several years, while continuing to fund our organic growth plans. With a growing cash position, we expect to reduce our $250 million of debt currently outstanding, while also evaluating opportunities to buy back shares and eliminate a portion of the remaining legacy Argonaut hedges. I will now turn the call over to our COO, Luke Guimond, to provide an overview of our operations. Luke.

Thank you, Greg. Over to slide 8. Third quarter production from the Island Gold District totaled 66,800 ounces, a 4% increase from the previous quarter. A more substantial increase is expected in the fourth quarter, driven by an increase in combined milling rates from the Island Gold and Maginot mills. Maginot's milling rates continued to increase through the third quarter until the last week of September, when a capacitor failure within the electrical house impacted the electrical drive for the sag and ball mills. This resulted in one week of unplanned downtime. The capacitor and electrical drive module were replaced by the end of the quarter, following which milling rates have increased to average a new high in October. Quarter over quarter, underground mining rates increased 7% to 1,325 tons per day. Open pit mining rates increased 4% to 59,000 tons per day, including a 28% increase in ore mine to 17,600 tons per day. Grades mined from underground and the open pit were consistent with annual guidance. In mid-October, a seismic event occurred within the underground operation of Island Gold that has delayed access to higher-grade stoves within one mining front. Seismic events are not uncommon for underground operations, and mining rates are expected to remain within guided levels. However, grades mined in the fourth quarter are now expected to be lower than previously planned. We continue to expect a significant increase in production and decrease in costs in the fourth quarter. However, given the lower expected underground grades and unplanned downtime at the end of the third quarter, production guidance for the full year has been revised lower to between 260,000 and 270,000 ounces. Moving to slide nine, a number of optimization initiatives have been implemented within the Maginot Mill over the past year that continue to drive improvements quarter over quarter. This included the installation of a redesigned liner and bolt configuration within the sag mill in July, such that following the liner change and excluding the one week of unplanned downtime at the end of September, milling rates increased nearly 10%. With the mill up and running by the end of the third quarter, milling rates have continued to improve in October, approaching 10,000 tons per day, a new monthly high for the operation. To minimize potential unplanned downtime in the future and ensure increasing consistency of the operation, a further review of electrical components was completed to ensure all critical spares have been identified and are on site. Moving to slide 10, given the unplanned downtime at the Maginot Mill, the decision was made to restart the Island Gold Mill the last week of September to focus on processing higher-grade underground ore. Operating the two mills will provide additional operational flexibility with increased milling capacity and allow us to capitalize on the higher gold price environment with stronger gold production. The restart of the island mill provides an additional 1,200 tons per day of milling capacity. This is expected to support approximately 3,000 ounces of additional gold production on a quarterly basis, driving increased cash flow and profitability. At current gold prices, this represents nearly 50 million of additional annualized revenue with significantly higher gold prices, more than offsetting the higher processing costs associated with operating the Island Gold Mill. We will operate the two mills through the end of this year and will evaluate its ongoing operation into 2026 as part of the expansion study. Over to slide 11, the Phase III Plus expansion continues to progress with the shaft sink now at the 1350 meter level, 98% of the ultimate depth of 1379 meters. Work also commenced on the 1350 level shaft station. The Maginot Mill expansion to 12,400 tons per day is progressing well and is on track for completion in the second half of 2026. Base plant construction is advancing and expected to be completed in the first quarter of 2026. Mechanical and electrical outfitting for the water handling facility and shaft in-house is ongoing, and concrete foundation work for the new administrative complex is underway. Over to slide 12. As of quarter end, we have spent and committed 84% of the total phase 3 plus capital of $835 million. The photos on the right highlight the progress on the shaft sink and 1350 level shaft station. We expect to be skipping more from this station in the latter part of next year, with the expansion on track for completion in the second half of 2026. Over to slide 13. We continue to advance the expansion study for the Island Gold District, which includes the evaluation of a larger mill expansion of up to 20,000 tons per day. The study is expected to include a larger mineral reserve to ongoing mineral resource conversion, with encouraging results from our delineation drilling program supporting a strong rate of conversion and reserve growth. Work currently underway as part of the Phase III Plus expansion to 12,400 tons per day is being completed with the larger expansion in mind. This includes sizing the footprint of the new milled building to accommodate additional equipment for a further expansion of up to 20,000 tons per day. To ensure all the assays from the recently completed delineation drilling program are incorporated into the expansion study, we have shifted the completion of the expansion study from late this year to the first quarter of 2026. With a larger mineral reserve and higher combined mining and milling rates, we expect the expansion study will demonstrate Significant upside to the base case plan released earlier this year. Over to slide 14. Young-Davidson produced 37,900 ounces in the quarter, similar to the second quarter reflecting the planned shutdown of the Northgate shaft the first week of July to change the head ropes. Reflecting the downtime, mining rates averaged 7,300 tons per day in the quarter. Given the lower mining rates earlier in the quarter, excess mill capacity and higher grade prices, sorry, higher gold prices, the low-grade stockpile ore was processed. Mill throughput rates averaged 7,800 tons per day in the quarter, a 12% increase over the previous quarter. Reflecting the contribution of lower-grade stockpile ore, process rates of 1.79 grams per ton were 7% lower than mine rates. Reflecting lower mining and milling rates for the first nine months of the year, production guidance has been revised lower to between 160,000 and 165,000 ounces. Mining rates have returned to targeted levels, averaging 8,000 tons per day in September and October, and are expected to remain at similar levels the remainder of the year. Grades mined also increased towards the upper end of guidance in October at 2.25 grams per ton, and are expected to remain at similar levels the rest of the quarter. With higher mining rates and grades, Young-Davidson is expected to have a much stronger fourth quarter with higher production and lower costs. Mine site all-in sustaining costs decreased in the third quarter. With a further decrease expected in the fourth quarter, the operation remains on track to achieve the full-year cost guidance that was revised earlier in the year. Young-Davidson continues delivering strong mine site free cash flow with $62 million generated in the quarter, and 160 million in the first nine months of the year, already surpassing the previous full-year record of 141 million in 2024. With strong ongoing free cash flow, the operation is on track to deliver well over 200 million for the full year at current gold prices. Over to slide 15, production from the Mulatto District totaled 37,000 ounces in the third quarter, a 9% increase quarter over quarter with the operation benefiting from strong ongoing stacking rates and grades, and the recovery of previously stacked ounces. This trend is expected to continue with a further increase in production in the fourth quarter, as the operation benefits from the recovery of higher grade ore stacked in the previous two quarters. With higher production expected in the fourth quarter, we are increasing full-year production guidance to between 140,000 and 145,000 ounces. Reflecting the stronger production, cost declined in the third quarter and with a further decrease expected in the fourth quarter, the operation is well positioned to meet its full year cost guidance. The PDA project continued advancing during the quarter with the focus on procurement of long lead items and detailed engineering. Expenditures are expected to increase in the fourth quarter and more significantly into 2026 with the wrap-up of construction activities. Kojak remains on budget and on track to achieve initial production mid-2027. The Mulattos District generated mine site free cash flow of $73 million in the quarter and $129 million in the first nine months of the year. It remains well positioned to continue generating strong free cash flow while fully funding construction of PDA. With that, I will turn the call back to John. Thank you, Luke.

I want to reiterate that this has not been a typical year for Alamos, and not reflective of our long-term record of meeting or exceeding expectations. Our near-term and long-term outlook remain bright, and with one of the strongest growth calls in the sector, we remain confident in our ability to deliver on our guidance. We expect to demonstrate this strong outlook, starting with a significant increase in production and decrease in costs in the fourth quarter. I'll now turn the call back to the operator who will open up for your questions.

Hi, Maud. We'd like to open up the call for Q&A now, please.

Certainly. Thank you. We will now take questions from the telephone lines. If you have a question, please press star 1. You may cancel your questions at any time by pressing star 2. Please press star one at this time if you have a question. There will be a brief pause while participants register for their questions. And we thank you for your patience. Our first question is from Cosmos 2 from CIBC. Please go ahead.

Great. Thanks, John and team. Maybe my first question is on Q4. John, as you mentioned, we're expecting increases to production in Q4. You've given us a range, 157,000 to 177,000 ounces. Fairly sizable range, especially for quarterly production. Could you maybe just touch on some of the factors that could lead you to the higher end of that guidance versus, say, the lower end?

Yep. Cosmos, hi. Luke here. Hi, Luke. across the uh operations as we've touched on i mean we're we're consistently delivering on the the higher mining rates with young davidson at 8 000 tons per day the big driver really for the the higher goal production also coming out of young davidson in the fourth quarter is related to grade uh you know based on the mine plan that we have put forward for the fourth quarter we're expecting to be at the high end of our of our guided grades of 205 to 225 so we're at the higher end of that 225 area With regards to mulattoes, it's really a function of, you know, we've stacked a lot of gold in the first couple of quarters, Q1, Q2, and certainly Q3, and we'll start to see more of that gold production coming off the leach pad in the fourth quarter, which will drive higher production for mulattoes. Island gold, we continue with, you know, similar guided levels of mining rates and certainly great performance as well through the fourth quarter as expected from island. So when you combine those three catalysts from those operations, that's what's really driving the higher gold production in the fourth quarter.

And Luke, since I have you here, could you maybe elaborate a little bit on that seismic activity that happened at Island Gold in mid-October? It sounds like it's not a permanent issue. It doesn't seem like it has longer-term impacts, but could you give us a bit more granularity in terms of sort of what happened? Was it in a higher risk area?

Yep, I can touch on that a bit. So, I mean, just to, you know, emphasize seismicity is just a natural aspect of occurrence that occurs with underground mining operations. You know, as we extract the ore body through development and production blasting, we're changing the stress regime within the mining environment. In this case, the one mining front that was affected with this seismic event, really the reason that we've had to stop production from that one area is due to the fact that from a legislative perspective, we need to have two means of egress out of the mine, one being the ramp system, and in Island's case, the second one is an escapeway between the levels. And with this seismic event that happened within this one area, the escapeway was compromised, meaning it needed some rehabilitation. in order to bring it back online. So we're just in the process of doing that. It's not a long-term delay. We would expect to be back in that mining front area early December to continue production in there. So it's not a long-term residual effect as a result of the seismicity. But it is normal course of business. We always have seismic events. Some can be lower levels and some can be higher levels. In this case, it just resulted in some damage to the escape rate, which we're addressing.

And, Luke, you know, these escapeways, more permanent infrastructures, I would have thought that they are built to a standard that can certainly withstand some of these stress regimes. But, you know, again, there's other factors as well. I guess my question is, was that unexpected? Has this happened before? And what do you now have in place in terms of, you know, again, I understand that these types of activity happens, but what do you have in place now? to hopefully mitigate some of the risk on a go-forward basis?

Yeah, look, I mean, I kind of referenced with regards to our ground control management plan and our seismic management plan that we have in place for all of our underground operations. In this case, you know, the ground support continues to develop and change as we get into different mining areas and maybe different elevations of stress that are being seen within the mining operations. We adjust accordingly with that. We do have a lot of dynamic support in place to mitigate these sort of environments that happen when we do have an elevated stress environment. And in this case, for the most part, I'd say the ground support actually worked as per expected. But just keep in mind, you know, rehabilitation is just kind of also a natural function of an underground operation residually. You know, the scaling activities that occur and some additional ground support requirements as a result of some of these openings being open for a longer term. In this case, the escapeway being one of those. So it's not uncommon to actually have to go back in and do some rehabilitation. In this case, again, because of the fact that the escapeway has been compromised, we've just had to go in and repair that escapeway to be able to resume mining activities within that mining front.

Great. Maybe one last question. As you mentioned, the expansion study for Allied Gold is now expected in Q1 2026 versus Q4 2025, in part to incorporate potentially including the island gold mill in terms of running it into 2026. But I guess in the end, maybe bigger picture, you know, gold prices are certainly much higher now compared to when you put out the island gold, the first base case study. Is there a bit of a shift in terms of thinking here? in terms of lower-grade material can actually now be profitable. So maybe running island gold for longer could increase the overall throughput. And in the end, some of that lower-grade ore could still generate cash, and overall cash flow is higher. Is there that kind of thinking going on right now, John, in terms of how you're looking at the island gold, and maybe even a broader picture as well of the other operations? And then, you know, how would that be incorporated into the year-end sort of reserve resource statement that's coming out? Like, what kind of gold price would you look at?

That's got to go down as one of the longest questions in history, Cosmo. But just looking at Island Gold, we envisioned at the time we – acquired Argonaut with the idea of integrating both mines, we envisioned that that would ultimately evolve into something like a 20,000 ton per day operation. And we're doing the work right now in order to bring that in front of the market probably January, early February of next year. That's the time we're aiming for. That's just the optimal rate that that mine ought to run at. It means it gets to part of your question. For example, right now we're milling about one gram material coming out of the open pit and we're stockpiling lower grade material. It's an absolute fact that with the lower cost and the higher throughput rate of not putting anything into stock, but just putting it all through the mill, that's a much more profitable way to go about it. We'll be able to demonstrate that with the numbers that we'll provide early next year. But you're not double handling ore on a combined grade. In other words, mixing in that lower grade material, it's basically running around half a gram. mixing that in with the one-gram material, we're still running a pretty decent head grade. But you're just doing it all at a greater scale, sort of benefiting from the economies of scale, and absolutely doing it at a lower cost because there's no double handling anymore. So from the point of view of this bigger mine that we envision at Island Gold, it also envisions roughly 3,000 tons of underground throughput from the island mine itself. That takes production up over half a million ounces a year, brings costs down closer to that $1,100, $1,200 ASIC, somewhere in that range. The study will define it more precisely. But you can see, you know, that we're sitting on roughly, you know, somewhere between 11 and 12 million ounces of reserves and resources. That's a really sensible approach to take for the development of that mine. We can get there with relatively, how should I put it, you know, bite-sized capital costs. It's not a real stretch for us to get it there. And, you know, it's... it's sort of the next step in our evolution at that project site. We're not thinking about that at either Young Davidson or Mulatto's. Young Davidson, it's not really that sensitive to the gold price, to be honest. It's just the way that ore body is. We're mining it in a very profitable way, obviously. We're generating phenomenal cash flows, and now we've got... We've got that mill running very, very well, consistently hitting 8,000 tons a day. You know, you're going to see Young David's have a great year next year. Long term at Mulatto's, you know, the game changer is going to be going underground and mining high-grade underground sulfite material and processing it through the mill that we're going to build. That really is the future for I mean, it's not like we've run out of targets for finding additional oxide material. It's a big district, and we're still poking around doing green fields exploration in various areas and actually getting some interesting results. But the main thrust of what we're doing at Mulatto's is to transition from low-grade heap leach production to higher-grade underground production. So that would, you know, in... the grand scheme of things, that's where we're going. It's not like we're taking this one concept driven by a higher gold price and trying to apply it across every operation.

The only other thing I'd add there, Cosmo, is just, you know, with regard to the 20,000 ton per day plan for the Island Gold District, that hasn't changed. I mean, we're still looking to put that obviously out. We've changed the guidance on that to put it out early in Q1, but You know, it'll outline a plan of running about 70,000 tons per day coming from open pit operations, 3,000 tons per day coming from underground operations. So that still is the plan. As far as the island mill that we're still continuing to run at this point, which we restarted in September, we'll evaluate that as part of our business plans for 2026. But, you know, given this high gold price environment, giving us more gold production, certainly, and more cash flow, It may make sense to continue to run that in 2026, but we're still evaluating that.

Great. Thanks. Sorry for my extra long question. I still haven't thanked Scott Parsons for putting out earnings during Game 5 of the World Series. It certainly has not impacted my performance. Thanks again, John and Tina.

Thank you. Our following question is from Oves Abib from Scotiabank. Please go ahead.

Hi, John and Alamo's team. A couple of questions from me as well. Cosmos did ask a couple of questions that I had, but just to follow up to Cosmos' questions on the seismic activity at Island Gold. Again, really glad to hear no personnel or equipment were impacted by this event. So that was really good to hear. But in terms of, and maybe this question for Luke, in terms of active mining fronts. How many active mining fronts do you have access to at Island Gold, as well as how does this impact mine sequencing going into 2026?

We typically carry about three to four mining fronts with the mining rates that we're currently running out right now. Obviously, with the ramp-up as we continue to head towards 2,400 tons a day through the course of next year, our development will put us into a place where we'll be developing more mining fronts. As I mentioned in this case, we've just basically shifted our focus from this one mining front that's been put on hold until we get that escape way in place and look to generate production from some of the other areas of the mine in the interim. But as I mentioned, it's a short-term issue with regards to the seismic event that happened there and we're looking to resume the mining in that specific mining front early in December.

Thanks for the cover on that, Luca. And just also in terms of when you do get access to additional mining funds, I mean, in terms of isn't that a mitigating factor on itself, you know, going into 2026 then?

Sorry, can you repeat that question, Elise? I didn't quite get it.

I'm basically trying to figure out is when you do start increasing the number of mining funds as you go into 2026 and into the expansion, isn't that a mitigating factor on itself?

With regards to the production profile, yeah, it certainly gives us more flexibility, I think is what you're getting at. Yes, it will give us more flexibility as far as maintaining the mining, the rates that we're looking at. But, again, in this case, you know, we haven't changed our guided levels for Q4 for mining rates. It's just that we've had to refocus some of the activity as far as our production for the fourth quarter because of the fact that, you know, we've got about a six-week interruption from this one mining fund until we get the escapeway reestablished.

Perfect. Thanks for that. And just moving on to Maginot, with the unplanned downtime at Maginot Mill, that was, I believe, late September, were you also able to take advantage of this downtime to do any sort of additional maintenance on the mill as well?

We did. But, you know, through the quarter, I think we spoke about this with the last quarter release that, you know, there was a liner bolt configuration redesign that we actioned in the quarter. So we did that in July. We also had some scheduled maintenance in August for the ball mill, but certainly with that one-week interruption with regards to the capacitor failing, which led to the drive module also failing, that we had to get replaced. We did take the opportunity to do some other plant maintenance within the Maginot Mill facility as well.

Okay, thanks for that. And just then moving towards exploration, I don't know if the other Scott is online. I am here. Hey, Scott. So can you give us a brief kind of overview of where you are currently focused on on the exploration side, and especially if you continue to have success on, you know, Island Gold West as well as in close proximity to Medina?

Yeah, I can provide an overview here to date. If you look at Island Gold, I mean, we really did shift our strategy from the start of the year from, Expiration into delineation, and that delineation program now has been completed successfully in the third quarter, both at Maginot and at Island Gold, and that really was focusing on converting that inferred mineral base that remains our June update for the expansion study, converting that into reserves. So that process now... of the reserve calculation is underway with the delineation results coming in or have been received. At Island as well, I mean, we continue now shifting in the fourth quarter to exploration. So we're drilling Island down plunge. We're drilling the upper portions of Island to the west between Island and Maginot within that main Island build structure. So that's ongoing. We've also started a phase two drill program at Klein and Edwards, which is building off the success of the first part of the year. That's the past producing mines that are seven kilometers from the Maginot mill. And we're excited about the results of it. At Young-Davidson, that hanging wall exploration drift in 9620 has been developed, and we're drilling from that now. That's focused on defining that high-grade zone in the conglomerate. We've drilled 15 holes there. Our athes are just starting to come in. Drilling is ongoing. We'll continue stepping out from that zone that we've defined, looking to expand on that mineralization. And we're also starting a regional program in the fourth quarter at Yonge-Davidson focused on ROT's target, which is only three kilometers from the Yonge-Davidson mill. And we see that as potential for future open pits or that could come into the mill at some point in the future. At Mulatto's, as John touched on, really focused this year on sulfide exploration across the district and having success on several targets. Building on, from the first half of the year, drilling at PDA, continuing to expand mineralization at Sarah Pallone, testing a number of other sulfide targets in that district that... The team has worked up and we're excited by some of the results that we're seeing at Mulatto's. I think that really points to the transition, as John said, from shifting from looking for oxide, which we're still doing and they're still targets, but really focusing in on building out the sulfide inventory, the high-grade underground components of what could be the future of that district. I guess the last point I'll shift to is Kikovic, which was the greenfield project in Nunavik in northern Quebec that we acquired with Orford Mining. That exploration on Kikovic was executed in the third quarter. We planned on doing 7,000 meters. We did 9,000 meters, and really the objective there was – trying to find the source of these high-grade boulders that have been defined across that belt. So we drilled in five target areas. Assays are just coming in. But certainly happy that we accomplished more drilling there than what we anticipated based on the execution of the program and what we're seeing in some of that core.

Thanks, Scott, for that. That was a great overview of exploration. I appreciate that. That's it for me, guys. Thanks for taking my questions.

Thank you. Our following question is from Pavel Turek from Jefferies. Please go ahead.

Hi. Thanks for taking my question. Just on the Maginot Mill, can you maybe provide some more color on how you're thinking about the targeted throughput maybe by the end of this year? I believe it was previously 11.2 thousand tons per day. and then 12.4 thousand tons per day next year. How should we be thinking about that, given some of the ramp-up issues so far?

Yeah, similar line of sight. As I mentioned, through the third quarter, there certainly we had some changes to make to the sag mill with regards to the liner bolt configuration, which we did. Scheduled ball mill liner change, and then with obviously the failure with the capacitor in September, put us back a bit. But really, starting in mid-July up until that capacitor issue that we had at the end of September, the mill was on a path that was consistently delivering above 10,000 tons per day through that period. And since we've repaired the capacitor period that we had at the end of September and resumed milling activities through the month of October, we've been consistently averaging just above 10,000 tons per day as well. So our goal... Hitting that 11-2 by the end of the year still is intact. Just some more fine-tuning that we need to do between now and the end of the quarter to be able to consistently deliver on that. The 12-4 scenario, longer term, we're obviously working on some of that expansion already. We need more additional equipment at the back end of the mill with regards to the CIP, the lease circuit. the refinery in Aleutian in order to be able to handle the higher gold content coming into the plant. So we're working through that. The other aspect of it is also up front. The crushing capacity is there, and we're still evaluating on the grinding capacity requirements with potentially a third grinding circuit in that circuit to be able to support the 12-4. But we're still evaluating that as part of the overall mill expansion, to be honest with you, and that's part of what will come out early in the new year.

Okay, that's helpful. And then maybe just as a follow-up, so if the Maginot mill is able to get to 11.2 thousand tons per day by the end of this year, things are improving, would that be reason enough not to keep running the island gold mill?

I think at these gold prices, Fahd, it's probably, I mean, we're evaluating this, but I would think we want to put as much throughput as we can through, and running those two mills at these gold prices probably makes sense.

Got it. Thank you very much.

Thank you. Our following question is from Satish Kazinathan from Bank of America. Please go ahead.

Hi. Good morning. Thanks for taking my questions. Most of my questions have been asked and answered. So maybe a question for Greg. So with over $600 million in cash balance, you indicated that you will be more active in buybacks. How should we think about the cadence of buybacks on a quarterly or an annual basis? Do you have a target trend rate in mind? And also given your growth projects, how should we think about like a minimum cash balance?

Yeah, thank you. I mean, from a share buyback perspective, We've never put targets in place. I mean, what we always want to do is be opportunistic with respect to that. And we also look at our other needs of capital, you know, whether it's growing the business, whether it's paying down debt. So we're looking at all of those. So I don't want to point to a specific target in terms of the buybacks. But, you know, based on the pullback in the share price, in the gold price that we've seen over the last, a week to two weeks, plus the reaction today, we expect to be active on the share buyback. And then in terms of a minimum cash balance, again, We have lots of liquidity. We have $1.1 billion of liquidity currently. In terms of the current cash balance of $600 million, we want to be active on the share buyback. We want to pay down some debt. We want to evaluate whether we're going to buy back some of the legacy Argonaut hedges. All of those will be sources of capital. But we are ultimately growing the business from 600,000 ounces to upwards of a million ounces by the end of the year. So we do need to make sure that we have sufficient capital. But we do have free cash flow as we speak right now. So from a minimum cash balance, I'd say we probably want to always have at least $250 million to $300 million on the balance sheet.

Okay, thank you. Maybe a question on Young-Davidson. So it seems the mill has been operating at 8,000 tons per day for a couple of months now. Do you think the mill's performance has reached a level that it can continue to consistently operate at this level? And given the current gold prices, is there potential for maybe pushing the mill to a higher end rate?

Yeah, the mill has been performing quite well at Young-Davidson. I mean, obviously our The overall lower production that's come out through Q3 and some of the previous quarters has been more related to giving all of the feed that we can from the mining operations. And certainly in Q3, it was related to the hoist rope change that we had to make with regards to the head ropes. But the mill has been performing quite well. It's no issues there. On the aspect of actually looking to see if it can do more, that's something that we've been looking at and seeing with other opportunities to be able to increase the overall throughput through that mill complex. It would not necessarily come from more underground ore. The mine is designed and the infrastructure is designed to support 8,000 tons per day. But there's other opportunities with some of the smaller satellite open pit deposits within the region of Yonge-Davidson that we could look to bring into a mine plan and provide additional mill feed to the YD mill complex with some minor capital requirements to be able to do that. The potential would be to probably get it up

per day consistently okay thank you thank you once again please press star 1 at this time for any questions or comments following question is from Don DeMarco from National Bank please go ahead Thank You operator and good morning John and team maybe I just a quick question on the capacitor

incident, what were the root causes of that, and is there a risk of a repeat?

The capacitor failure, we're still actually having that analyzed, so I don't have a firm answer on that, but it's not something that you would typically see, to be honest with you, so there could have been a defect within that part itself. I mean, we've been running our Island Gold mill complex and our Young-Davidson mill complex for years. and I've never experienced that sort of failure with a capacitor, but it wasn't just the capacitor. The capacitor failing was part of it, but that led to some residual damage within the drive unit of the power module that operates the sag mill and the ball mill. So we had some other component failure there, like resistors and a bus bar and some other electrical components that resulted in some additional repairs. But this is not normal course of business. We've never seen this with any of our other operations. So I'd say at this point it's a one-off, but we still need to do further diagnosis to understand exactly what happened with that capacitor.

Okay. Look forward to that.

And it sounds like the timing of the mining – inventory aspect and just making sure that we have all of the parts. We have done another further thorough review of our electrical components for running that plant to make sure that we have all of the critical spares that we need just to prevent any sort of significant downtime moving forward.

Okay. Then just to my next question, with regard to the Maginot mill and combining the two ore streams back into that mill, It sounds like it's potentially 2026, maybe later. It seems like there's good reason at this gold price to keep the 1,200 ton per day island mill running. But since you've done it before, you've done it once already in July, would the second time around be somewhat routine just with a quicker ramp up?

Yeah, it's pretty seamless, to be honest with you, to put both ore streams into the one plant. I think I've mentioned before we did a couple of batch tests just to confirm the metallurgy back in Q2, Q3, and that all was validated and And frankly, you know, running that combined ore stream into the Maginot Mill from really mid-July until we did have that capacitor failure at the end of September. Metallurgically, everything was performing quite well, both from a gravity recovery point of view as well as overall recovery. The expectations were as per what we were expecting as far as what we modeled to what we were seeing in the plant. So it's a pretty easy, simple transition to just provide that ore feedback into the stream and combine the two processes. the two streams feeding into the one-mill complex.

Okay. And then, just as a final question, turning to Lynn Lake development, we see that the timeline has been impacted by the wildfires. How about CAPEX? Can you give any more granularity on the implications to the CAPEX estimates to develop that project?

Well, yeah, I mean, the CapEx wise, I guess, you know, you'll have the inflation component there over the next because of the fact that it's been delayed a bit. I think what we've, you know, we basically lost all of the construction season this summer, which is, you know, the most productive period that you can have, certainly in northern Manitoba or northern Ontario, depending on where we're building these operations. So As a result of that, our original timeline was mid-2028. Now we're moving that out to early 2029. So you're going to have a bit of an inflation factor that gets factored into that.

Yeah, I mean, just adding to that, we put out the study a couple of years ago. So you have three years of inflation since we put out that study with this additional year that... that Luke just commented on, moving it out to 2029. And inflation on capital projects has run around 5% to 6%. So you can expect a 15% increase in our capital that we put out in the feasibility study for LendLake.

Okay. Thank you. Well, thank you for taking my questions. That's all for me. And good luck with the rest of the quarter.

Thank you. There are no further questions registered at this time. This concludes this morning's call. If you have any further questions that have not been answered, please feel free to contact Mr. Scott Parsons at 416-368-9932, extension 5439.