Fortuna Mining Corp

and welcome to the Fortuna Silver second quarter 2023 financial and operational results call. At this time, all participants are on a listen-only mode, and a question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note, this conference is being recorded. I will now turn the conference over to your host Mr. Carlos Baca, Vice President of Investor Relations. Sir, the floor is yours.

Thank you, Wally. Good morning, ladies and gentlemen. I would like to welcome you to Fortuna Silvermine's second quarter 2023 financial and operational results conference call. Hosting the call today on behalf of Fortuna will be Jorge Alberto Ganosa, President and Chief Executive Officer, Luis Darío Ganosa, Chief Financial Officer, Cesar Velasco, Chief Operating Officer, Latin America. David Whittle, Chief Operating Officer, West Africa. And Julian Bodron, Senior Vice President of Sustainability. Today's earnings call presentation will be available on our website, fortunasilver.com. As a reminder, statements made during this call are subject to the reader advisories included in yesterday's news release and in the earnings call presentation. Financial figures contained in the presentation and discussed in today's call are presented in U.S. dollars unless otherwise stated. Before I turn over the call to Jorge, I would like to indicate that this earnings call contains forward-looking information that is based on the company's current expectations, estimates, and beliefs, and is subject to a number of risks, uncertainties, and other factors that could cause actual results to differ materially from a conclusion, forecast, or projection, meaning the forward-looking information. A description of these risks, uncertainties, and other factors is set out in the company's annual information form for the financial year ended December 31st, 2022. The annual MD&A for the financial year ended December 31st, 2022, and the interim MD&A for the second quarter 2023, which are all publicly available on CEDARplus website. Certain material factors or assumptions were applied by the company in drawing a conclusion or making a forecast or projection as reflected in the forward-looking information made in this call. These material factors or assumptions are also described in the company's annual information form for the financial year ended December 31, 2022, the annual MD&A for the financial year ended December 31, 2022, and the interim MD&A for the second quarter, 2023. The company assumes no obligation to update such forward-looking information in the future, except as required by law. I would now like to turn the call over to Jorge Alberto Ganosa, president, chief executive officer, and co-founder of Fortuna.

Thank you, Carlos. The highlights of the quarter is our first go-to at the newly built Seguela Mine for sure. This took place on May 24th, as we pre-released. Seguela was delivered on budget and slightly ahead of schedule. Seguela is a flagship asset for the company, adding high margin gold ounces for over a decade of mining to our portfolio. David Whittle, our chief operating officer for West Africa, is here with us, and he will share with you our progress on the ramp-up activities later in this call. But I can advance that beyond the normal startup hiccup here and there, things are advancing according to plan. And after a little over two years since the Rocksville acquisition and subsequent capital deployment towards the delivery of Segela, we're ready to start harvesting the cash flows and benefits of the transaction. Our strategic expansion of the business into West Africa is going to start paying off. We now have two operating mines in the region and starting in Q3, West Africa becomes our largest contributor to free cash flow. And or recent agreement to acquire Chester resources and the advanced exploration stage the embassy project in Senegal, which is set to close in September. Adds to our exciting regional exploration and growth pipeline during the quarter, we had to contend with a couple of events that waited on the operational and financial resource of the company for the period. which were pre-released and discussed in our Q1 NDNA as subsequent events. At the San Jose mine in Mexico, demands by the workers' union for higher profit sharing beyond what is mandated by law and or standing collective agreements with the union led to a 15-day legal blockade generating corresponding loss of production, expenses, and standby charges. Carlos Ortiz- Across Mexico, there have been generalized worker union demands for higher profit sharing, which have affected several mind. Carlos Ortiz- The more notable one, probably being human Spanish keto which, unfortunately, has been on standby for two months now trying to resolve the issue. Carlos Ortiz- At or get a mobile mind in Burkina Faso, we had to repair the arm tech tunnel at the entrance portal of the mind. closing access to the mine entrance for 27 days. Although this event at Yaramoco did not impact production, which is tracking on the upper end of guidance for the year, it did generate standby charges of approximately $1.5 million. And at the Lindero mine in Argentina, our PEEP operations reached a peak in the movement of waste material during the quarter, David Rivera- Reaching a stripping ratio 2.7 to one, which we expect to revert back to 1.1 to one for Q3 and 0.7 to one for Q4 David Rivera- Also bear in mind that over the next 18 months we will be carrying out the first and final a planned expansion of the leach, but at the little mind. This is a $34 million project and the single largest in our sustainability CapEx portfolio. At Seguela, we produced 4,023 gold ounces in the quarter, but those ounces were sold in July. So our Q3 sales will benefit from that bump when we report Q3 results. Taking into account the issues described before, our business managed to generate $9.5 million of free cash flow from operations, $44 million in net cash flow from operating activities, $44 million in adjusted EBITDA, and a net operating income of $3.5 million, or one cent per share. Our consolidated all-in sustaining cost is expected to have peaked in Q2 at $1,799, and to come down during Q3 and Q4 as the operational issues at San Jose and Yaramoco were successfully resolved in the second quarter. Waste stripping at Lindero comes down in the second half of the year, as I previously mentioned. And more importantly, we start benefiting from the Seguela mine sales in the third quarter. Lease or CFO will expand on this. There is a general theme of margin compression over the last years across the mining industry, and we, of course, have not been immune to this. And again, that is why assets like Segela are pivotal to our portfolio. We expect Segela to operate at an all-in sustaining cost in the vicinity of $1,000 per ounce moving forward. On the exploration side of the business, We continue to report positive results coming from Seguela infill drilling at Sandberg and new prospects like Barana, where we reported earlier this week a drill hole intersect of 90 grams of gold over a true width of 1.8 meters. Also, on a positive note, our exploration at the Yaramoco Mine continues extending mineralization and reproducing Zone 55 ore bodies to a point where we're planning for an interim research update before the end of the year. David Whittle will also be expanding on this as well. In June, we had a fatal accident at the Cayuma mine involving one of our mine contractors conducting activities related to work at heights. This tragic accident comes as a blow at a time when the Cayoma mine has been operating without any lost time injuries for 23 consecutive months and has robust management systems and practices in place. All identified improvement measures coming from the investigation and analysis of the accident have been implemented at the mine site, and a corporate action plan is in place to expand learnings across the organization. So something like this does not ever repeat again. Subsequent to the quarter end, we published our 2022 sustainability report. Communicating adequately on the topical issues of environmental and social governance with our stakeholders and meeting expectations sensibly is something we take very seriously. We carry out a thorough materiality assessment to identify which of the many expectations placed on the sector are reasonable to us and our moment. Julian Bodran, our Senior Vice President of Exploration, is here with us and can expand on the highlights of the report. Julian, do you want to touch on the report, please? Yes, thank you, Jorge.