Endeavour Silver Corporation

For standing by, this is the conference operator. Welcome to the Endeavor Silver Second Quarter 2025 Financial Results Conference Call. As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then 1 on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star, then zero. I would now like to turn the conference over to Allison Pettit, Vice President, Investor Relations. Please go ahead.

Thank you, Operator, and good morning, everyone. Before we get started, I ask that you view our MD&A for cautionary language regarding forward-looking statements and the risk factors pertaining to these statements. Our MD&A and financial statements are available on our website at edrsilver.com. On today's call, we have Endeavor Silver's CEO, Dan Dixon, our CFO, Elizabeth Dennis, and Endeavor's COO, Don Gray. Following Dan's formal remarks, we will open the call for questions. And now, over to Dan.

Thank you, Allison, and welcome, everyone. Q2 marks an eventful quarter for Endeavor Silver. The commissioning of Terranera, the acquisition of Colta, and its ongoing integration. This is transforming our company. As we move forward, our focus remains firmly on achieving commercial production at Terranera. In Q2, Endeavor produced 1.5 million ounces of silver and 7,800 ounces of gold, totaling approximately 2.5 million silver equivalent ounces, including some of our base metals now. This represents a 13% increase compared to Q2 of 2024 with the inclusion of our new mine in Peru, Colpa. We reported revenue of $85 million, an increase of 46% compared to prior year, benefiting from the higher price of metal prices and increased production. Mine operating cash flow before working capital changes rose by 21%. while operating costs remained below guidance with cash costs coming in at $15.35 per ounce of payable silver, and all in sustaining costs were $25.16 per ounce, net of $5 credit. Direct operating costs per term are relatively flat compared to the same period last year. Mine operating earnings decreased to $7.7 million from $10.2 million in Q2 of 2024 impacted by a $6 million loss at Terran Air during the commissioning phase and increased depreciation. The company reported a net loss of $20 million for the period, primarily due to Terran Air's offering losses during commissioning, increased G&A related to the acquisition of COPA, a $10 million non-cash loss on droves with increased depreciation and tax expenses during the quarter. As of June 30th, the company's cash position was $52 million. However, working capital was negative. If we excluded the non-cash derivatives, there is a $14 million surplus. This is by design with Terranair nearing commercial production. On August 5th, the company gave an update on throughput and recovery as the mine makes its way towards commercial production. With throughput significantly averaging between 1,900 and 2,000 tons per day, and silver and gold recovery averaging 71% and 67% during the second half of July, the company will be introducing higher-grade materials to help enhance recovery and sustain the design throughput of 2,000 tons per day. With ramp-up advancing, Charon Air continues to move closer to commercial production, adding a long-term asset to our portfolio while reinforcing the company's position as a leading mid-tier silver producer. Since the Monera-Colpa transaction closed on May 1st, integration of the new asset and teams has been going well. The company has continued to work on validating and updating the historical resources prepared by the previous owners, and as such is unable to provide production guidance for Colpa until a current 43-101 resource exists. Our management expects a similar production profile to Colpa's 2024 annual production of 5 million silver equivalent ounces. Colpa's May and June production annualized, Our production output tracks to align with Copa's historical performance, which would be annualized at 4.8 million ounces of silver equivalent production. Copa has continued to assess and is planning towards a 2,500 ton per day operation, and we've included additional capital in our outlook to achieve these production levels next year. When combined with 1SB involving those and with Terran Air coming online in the near term, Endeavour is on track to achieve an annualized production profile of 20 million silver equivalent ounces and expect that in 2026. Lastly, before we open this call to questions, we continue to advance the Pit the Reel project. Exploration work is focused on upgrading inferred resources to indicate it, and engineers are working on various studies to support tailings dam permits and an economic study. Again, it's been a very eventful and busy quarter, and with that, I'm happy to open this up to questions. Operators, please proceed to our Q&A session.