McEwen Inc.

Hello, ladies and gentlemen. Welcome to McEwen Mining's Q3 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 McGibbon, Executive Vice President of Exploration, and Michael Medding, Vice President and General Manager of McEwen Copper. After the speaker's presentation, there will be a question and answer session. If you'd like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you'd like to withdraw your question, please press star one again. I'll now turn the call over to Mr. Rob McEwen, chief owner. Please go ahead, sir.

Thank you, operator. Hello, ladies and gentlemen. Thank you for joining us today. During Q3, we addressed a number of the overhanging concerns about McEwen Mining. First, the financing of McEwen Copper. We completed an $82 million financing in a really tough market. And not only did we complete it, but we have the second largest mining company in the world becoming a shareholder through its subsidiaries. We had high costs at our operations at Fox. And in the third quarter, we turned in operating costs, cash costs per ounce, below industry averages at $774 per ounce. At Goldbar, we saw our production fall in the first half of the year as a result of carbonaceous ore and it resulted in unusually high costs, unacceptably high costs. We are opening up the Goldbar South deposit and it has no carbonaceous ore, it has higher grade ore, and it's a lower strip so we should be seeing lower cost production coming from there. We also had in Mexico it looked like we were coming to the end of the life of the mine. We did have a feasibility study there for a project called Phoenix and we've improved the economics of it considerably with the purchase of a process plant on very advantageous terms. These issues all obscured the value of McEwen Mining in my mind. And with these resolved and a steady improvement going forward, I believe that the value of McEwen Mining will become more apparent. And after the presentations of my associates, I will talk about the value I see behind McEwen Mining. So I would now like to turn it over to Perry Ying.

Thanks, Rob. I'll provide a brief overview of our third quarter financial results. I'll start by stating that our 100% owned mines generated a cash growth profit of $5.8 million and a growth profit of $1.5 million. You can compare that to our reported gap loss of $10.5 million, or $0.21 a share, which generally reflects the fact that the $7.6 million we invested in Las Azulas along with $5.1 million on exploration and other projects is expensed rather than capitalized. As Rob mentioned, our results reflect a 10-for-1 share consolidation that was completed in July during the quarter. Having completed that share consolidation, McEwen Mining has now regained full compliance with NYSE share price listing requirements. Looking at gold equivalent production just on a consolidated basis, production for the third quarter was 35,700 gold equivalent ounces, which was roughly equivalent to the production in the second quarter of the year and down approximately 16% from approximately 43,000 gold equivalent ounces produced in the third quarter of 2021. I'll have Bill Shaver talk about our production details, but overall I'll characterize our quarter as generally being strong at Fox and San Jose, but continuing to experience challenges at Gold Bar, as Rob alluded to. In terms of cash costs, as Rob stated earlier, we reported $774 as cash costs per ounce, and all in sustaining costs of $1308 per ounce. driven by our strong performance from our underground operations, which continued to produce ore well ahead of current mill throughput. We were also assisted by a weaker Canadian dollar. The US Canadian dollar exchange rate of approximately 131 was about 5 cents weaker than the same period in 2021. Just as a detail on our production at Fox, if you look at our inventory balances, There's about a $6 million build in ore inventory stockpiles just in the third quarter alone, and that ore is now sitting in surface stockpiles at our mills. So, going forward, this should allow for some greater flexibility in our mine sequencing and some cost-saving opportunities. In Nevada, looking at gold bar, our cash costs were $17.12 an ounce and all of sustaining at $2,049 an ounce. Although these figures are down slightly from the first half of the year, they remain elevated compared to the prior year due to low production levels resulting from carbonaceous ore issues and are well above spot gold prices. We noted our mining contractor demobilized towards the end of the quarter. We believe that this will have a limited impact on our cash flows, as we expect to continue to recover with digital allowances from the leach pads, and we expect to begin gold production within the next quarter. Finally, looking at our 49% owned San Jose mine in Argentina, they generally had a good quarter with cash costs of $12.23 per ounce and all-in sustaining costs of $15.62 an ounce, which was a significant improvement from the first half of the year, where they experienced COVID-related production issues as well as the fire. The San Jose mine during the quarter, but we are optimistic for the future, depending on silver and gold prices. Finally, looking at our treasury, our cash and equivalent balance stood at $55 million at the end of the quarter, which is roughly unchanged from the $54 million at the beginning of the year. As Rob noted, this included the completion of $82 million in private placements, of which approximately $42 million was completed during 2022, and $27 million during the quarter, primarily from subsidiary of Rio Tinto. Following that private placement, McEwen Mining's ownership of McEwen Copper was approximately 68%. So with that, I'll turn it over to Bill Shaver, our COO.