McEwen Inc.

Hello, ladies and gentlemen. Welcome to McEwen Mining's Q2 2022 Operating and Financial Results Conference Call. Present from the company today are Rob McEwen, Chairman and Chief Owner, Perry Ng, Chief Financial Officer, William Shaver, Chief Operating Officer, Stephen McGiven, Executive Vice President of Exploration, and Michael Metting, Vice President 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, again, press star one. I will now turn the call over to Mr. Rob McKeown, Chief Owner. Please go ahead, sir.

Thank you, Operator. Good morning, ladies and gentlemen, and welcome. The first quarter of this year was a lot weaker than our second quarter. Second quarter was much stronger. We had higher production and lower cost per ounce. The drivers of this improvement were our Fox complex that delivered its best performance since 2018, and the San Jose mine, which bounced back sharply, delivering in Q2, what it should have done in Q1. Looking ahead, we expect Gold Bar South to be in production in the fourth quarter of this year and it will be delivering more ounces and lowering Gold Bar's cost per ounce. Exploration at the Fox Complex has been successful building the gold resources at stock and should result in a significant reduction in the payback period. from its current six years towards our goal of less than three years for the FOX PEA, which we published in January of this year. The PEA, I'd like to stress, outlines a longer mine life extending into the mid-2030s and a higher average annual production of 80,000 ounces, which is almost twice this year's guidance for production at FOX. Progress at McEwen Copper's Los Azules project has been substantial. During the year, a strong management team with extensive experience operating in Argentina has been assembled. Drilling there has improved our knowledge of the deposit and will result in a big conversion of inferred resources into the indicated category. Multiple simulations have been conducted to optimize the mine planning. These results and other results will be included in the updated Los Azules PEA that will be released early next year. I also want to stress what we believed was very important to preserve and that was our listing on the New York Stock Exchange and that led to a 10 for 1 consolidation. I say the importance of maintaining it because 90% of our trading volume occurs on that exchange. Now I'd like to ask Perry to present our financials.

Thanks, Rob. Good morning, everyone. It's a pleasure to be back at McKinnon Mining at CFO after several years away and having the opportunity to rejoin a strong management team. Having joined halfway through the second quarter, I do observe that obviously the company experienced significant operating challenges during the first quarter, as well as various other times during the COVID pandemic. But I do believe the company is now well positioned from a financial operating and leadership perspective for success in the second half of the year and into the future. Looking at our results, I don't intend to read out a lot of numbers, but I'll just touch on our GAAP earnings. So starting with that, on a GAAP basis, we reported a consolidated net loss for the quarter of $12.4 million, or $0.26 a share. But that includes $19.2 million invested in exploration and advanced projects, of which $14.4 million relates to the lost Azulis copper project. If you look at just our operating assets, we actually generated $4.2 million in positive gross profit from our operation. As Rob mentioned, we completed a share consolidation just recently in July, and our results on a per share basis for the second quarter are retroactively reflect that 10 for 1 consolidation. Looking now at our production for the quarter, Production improved significantly compared to the first quarter. Production was 27,600 ounces of gold and 704,600 ounces of silver for a total of 36,100 gold equivalent ounces. So this represents an increase of approximately 44% from the first quarter as we experience COVID related labor shortages at both the Fox complex and San Jose mine during the first quarter. The improved throughput in the second quarter is reflected in our cash costs and all-in sustaining costs for the quarter, which were $11.69 and $15.49 per ounce, which were 15% and 11% below the midpoint of our annual guidance for the year. As Rob noted, the highlight was strong production from the Fox complex of 11,200 gold equivalent ounces. Production was also very strong at the San Jose mine, which produced 19,600 ounces. The only disappointing result was from the Gold Bar mine, which produced 5,100 gold equivalent ounces for the quarter due to the continued presence of carbonation ore. But as Rob noted, we have a plan in place to accelerate mining from the Gold Bar South project, and we believe we'll show positive benefits from that by the fourth quarter. I'll leave further discussion on this topic to Bill Shaver. And finally, looking at our treasury, our cash and equivalent balance stood at $44 million and including restricted cash at $48 million at June 30th. This is down just over $10 million from the beginning of the year, but I'll note that our accounts payable and accrued liabilities balance decreased by approximately $14 million since the beginning of the year. From a capital market standpoint, our primary activity during the quarter was the completion of a $15 million private placement by our McEwen Copper subsidiary in late June. So now McEwen Copper has raised $55 million of the intended $80 million first tranche financing. Following this transaction, McEwen Mining's ownership of Las Azulas now stands at 76%. So with that, I'll now turn the call over to Bill for review of operations.