Compañía de Minas Buenaventura

Good morning, ladies and gentlemen. Welcome to the Compania de Minas Buenaventura second quarter 2025 earnings results conference call. At this time, all participants are in a listen-only mode, and please note that this call is being recorded. I would now like to introduce your host for today's call, Mr. Sebastian Valencia, head of investor relations. Mr. Valencia, you may begin.

Good morning, everyone, and thank you for joining us Today to discuss our second quarter 2025 results. Today's discussion will be led by Mr. Leandro Garcia, Chief Executive Officer. Also joining our call today and available for your questions are Mr. Daniel Dominguez, Chief Financial Officer, Mr. Juan Carlos Ortiz, Vice President of Operations, Mr. Aldo Maza, Vice President of Business Development and Commercial, Mr. Alejandro Hermosa, Vice President of Sustainability, Mr. Renzo Maher, Vice President of Projects, Mr. Juan Carlos Salazar, Vice President of Geology and Explorations, and Mr. Raul Benavides, Director. Before I hand the call over, let me second touch on a few items. On Buenaventura's website, you will find our press release that was posted yesterday after the market closed. Please note that today's remarks include forward-looking statements that are based on management's current views and assumptions. While management believes that its assumptions, expectations, and projections are reasonable in view of the currently available information, you are cautioned not to place any reliance on these forward-looking statements. I encourage you to read the full disclosure concerning the forward-looking statements within the earnings result press release issued on July 24, 2025. Let me now turn the call over to Mr. Leandro Garcia.

Thank you, Sebastián. Good morning to all, and thank you for joining us today to discuss the quarterly results of the company. On slide two is our cautionary statement, important information that I encourage you to read. Today, we will be discussing our performance for the second quarter of 2025, highlighting key achievements and strategies moving forward. After the presentation, we will be able for our Q&A session where our team will be happy and eager to answer your questions. Continue with the next slide, please. I would like to highlight a few key areas that contribute to our strong second quarter 2025 results. Our EBITDA in the second quarter 2025 from direct operations was $130 million, compared to $107 million reported in the second quarter of 2024. Our net income in the second quarter of 2025 was $91 million compared to the $71 million in the net income in the second quarter of 2024. In the second quarter of 2025, silver production reached 3.6 million ounces, 11% lower compared to the 4 million ounces produced during the same period in last year, mainly due to lower production at Yumpac Tambomayo, and Huicani. Copper production increased 28% year over year, primarily due to halted operations at the Brocal in the second quarter of 2024, and it was related to the impact on copper ore processing during the period. Gold production was 27,345 ounces compared to 33,810 819 ounces produced in the second quarter of 2024, primarily due to decreased production at Tambomayo and Orcopampa, and partially offset by the increased production at La Zanja and El Brocal. In the second quarter of 2025, Buenaventura initiated the sale of part of the Cerro Verde's copper concentrate, approximately 20,000 meter tons have been sold by the quarter's end, out of a total of approximately 40,000 metric tons expected for the full year 2025. Cerro Verde announced a new dividend distribution of $59 million on July 24, corresponding to Buenaventura's equity share. These dividends will be distributed in August, resulting in a total of $108 The total capex for the quarter amounted to $107 million, with $82 million allocated to the San Gabriel project. The second quarter ended with a cash position of $589 million and a total debt of $860 million, resulting in a leverage ratio of 0.56 times. Finally, on July 23rd, when Aventura redeemed the remaining $149 million of its 2026 bond. Moving on to our cost structure in slide four, the all-in sustaining cost expressed in terms of copper for the second quarter of 2025 increased by 63% compared to the same period in the previous year. It is important to highlight that year-over-year increase in All sustaining cost was primarily driven by lower by-products credit. Moving on to the cost applicable to sales trend, as you can see, copper cash increased mainly due to slightly lower grades. Silver cash increased in line with the expectantials due to lower production at Hulcani, Tambomayo, and Yumpa compared to the previous year. Gold cash has increased. primarily driven by lower volumes and rates at Ambomayo and Orcopump. On the next slide, we will present the free cash flow generation. The second quarter 2025 cash position decreased during the quarter, mainly driven by net cash outflows from investing activities and dividends paid to our shareholders. The $49 million in dividends received from Cerro Verde are reflected in the operating cash flow. This dividend was received in April. In addition to these drivers, the bid to free cash flow reconciliation reflects Buenaventura's significant capex investments related to San Gabriel. Moving on to slide six, this slide shows San Gabriel cumulative progress, reaching 88% overall completion by the second quarter of 2025. primarily driven by finishing the engineering and the procurement, as well as the construction, as it is at 86% of advance. Second quarter 2025 CAPEX related to San Gabriel was $82 million. As of March 2025, San Gabriel's, as of June, sorry, 2025, San Gabriel's total CAPEX has reached $588 million. We anticipate commencing the ramp-up phase in the third quarter of 2025, followed by the production of the first gold bar in the fourth quarter of 2025. However, these milestones remain subject to the timely approval to the necessary permits. On the next slide, we are showing the processing plant's progress. Currently, the primary pressure mechanical works are at 100%. The sack and bowls mechanical works are at 100% also. And finally, the seal tanks mechanical works are at 98%. Moving on, we can see the progress of the main components of the plant. Moving on to slide 9, we are showing the progress at the filter tailings plant that currently is at 87%. To conclude the presentation, I would like to share a few final thoughts. First, we are committed to our strategy. Stable and continuous production are our flagships. We are making progress with optimization efforts to increase throughput and are continuously evaluating our operating portfolio. Exploration is part of our DNA. We are fully committed to extending the life of mine of our assets through continuous exploration effort. Third, we maintain our financial stability. Consistent with our commitment to the market, we redeem the remaining 2026 notes. And finally, San Gabriel project achieved at 88% overall progress. Meeting our planned targets, we remain on schedule to deliver our first gold bar by the fourth quarter of 2025. Thank you for your attention, and I will hand the call back to the operator to open the line for questions. Operator, please go ahead.