McEwen Inc.

Hello, ladies and gentlemen. Welcome to the McEwen Minings Q1 2022 Operating and Financial Results Conference Call. Present from the company today are Rob McEwen, Chairman and Chief Owner, Anna Ladd-Kruger, Chief Financial Officer, Rory Ravenstein, Director of Operations Canada, Adrienne Blanco, Director of Operations USA and Mexico, Stephen McKee-Gibbon, Executive Vice President of Exploration. Michael Metting, Vice President of McEwen, Copper and General Manager. After the speaker's presentation, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press the pound key. I'll now turn the call over to Mr. Rob McEwen, Chief Owner. Please go ahead, sir.

Thank you, operator. Hello, ladies and gentlemen. Welcome to our first quarter 2022 conference call. Last year, we saw signs of our turnaround in progress. The trend looked good as we closed on 2021 with higher gold production and lower production costs per ounce relative to 2020. This year, our results have been mixed. The Fox complex started strong and then was slowed down by manpower shortages induced by COVID, and that was followed by an equipment failure in the mill. But despite these issues, Fox produced more gold at a lower cost than it did in the first quarter of 2020. An important development in Q1 was our preliminary economic assessment. that outline the future growth prospects of the Fox complex. It details a bright future for Fox with a nine-year mine life, significantly longer than what we have right now, and attractive mining costs. We are confident that our exploration will result in a shortening of the payback period and an improvement in the economics. Our Director of Canadian Operations, Rory Gravenstein, will be expanding on the activities later on this call. Mining at Gold Bar, the costs were very high and we expected that because we're in a transitory stage of our mining cycle where there is an expensive period of stripping to remove overburden in order to reach the ore zone. Adrian Blanco, our Director of Operations for America and Mexico, will elaborate on both these operations. At the San Jose mine, which is operated by our joint venture partner, Hushield Mining, COVID-induced manpower absences resulted in a temporary mine shutdown that adversely impacted gold and silver production and the costs associated with that production. Looking ahead, our partner believes that they'll be able to make up what was lost in the first quarter over the balance of the year and deliver on guidance. At our Los Azules project, we have made much progress that I believe is significantly increasing the value for McEwen Mining of this large asset. Michael Medding, our Vice President, McEwen Copper, will provide you with an update. We encountered a cash squeeze during Q1. as a result of our revenue shortfall. However, I feel confident enough in the future value of the company to personally step up and provide the company with $15 million. We own a portfolio of assets, the majority of which are located in well-known prolific gold-producing districts in areas considered exploration-rich real estate, and that is why we continue to invest in exploration with the belief that we will be able to extend the life and size of our mines. We also own a huge copper project that is looking increasingly more valuable as a result of our investment, as a result of the surging demand for copper as a result of the higher copper price and the changing geopolitical environment in the largest copper-producing area in the world. At this point, I would like to ask Anna Ladkruger, our Chief Financial Officer, to provide an overview of McEwen Mining's financial results for the first quarter of this year.

Anna Ladkruger Thank you, Rob, and good day, everyone. The COVID-19 pandemic continued to impact our operations in Q1 in areas of supply chain, labor shortages, and inflationary pressures. We continue to monitor the impact of these factors on our financial condition, liquidity, operations, suppliers, and our workforce. Our consolidated net loss in Q1 was $19.3 million, or $0.04 loss per share. It relates primarily to $14.4 million invested in exploration and advancing our Los Azules project. Our operations had a total growth loss of $6 million. Contributing to this was $4.1 million loss from our Mexico operations as we wind down the residual heat leaching. We expect to make strategic decisions on our Mexican business unit in the second half of this year. We benefited from higher average realized gold price of $18.95 per gold equivalent ounce in Q1 versus $17.63 per gold equivalent ounce in the same quarter last year. Consolidated production in Q1 was 25,100 gold equivalent ounces. This included 14,400 gold equivalent ounces from our 100% owned operations, which was 4% higher than the same period last year. Average costs per cold equivalent ounces sold in Q1 from our 100% owned lines were $16.96 for cash costs and $21.46 for all-in sustaining costs. These were expected to be higher this quarter. However, they did come in lower than we guided to the market in March. Liquid assets at the end of the first quarter, which includes cash, cash equivalents, and restricted cash, was $70.4 million. of which $35.6 million is attributable to McEwen Copper to advance the Los Angeles project. A few transactions this quarter to bolster our treasury included a full-through raise of $15.1 million at $1.04 per share and an unsecured promissory note of $15 million. We also amended repayment terms on our senior debt facility, deferring principal payments to August 2023 and the ultimate maturity to March 2025, giving us further liquidity this year. We also ended the quarter with a stockpile of 36,000 tons of ore at an average goal grade of 3.6 grams per ton ahead of the mill at our Fox Complex operations. We are continuing to manage our operating margins by reviewing capital expenditures, production costs, material contracts, management systems, and procurement synergies between operations. And lastly, as most of you know, I suffered from a brain aneurysm in December, and through all odds and a lot of support from family, friends, McEwen Mining, and the mining community in general, I'm thankful to be here speaking and just about 100% recovered. On the back of this health scare, I've decided to retire from executive roles and focus my time with my family, board roles, and nonprofit work as well. Thank you, and I will now turn the call to Rory for operations review at the Fox Complex.