Pan American Silver Corp.

Thank you for standing by. This is the conference operator. Welcome to the Pan American Silver first quarter 2025 results conference call. As a reminder, all participants are in listen-only mode. 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 one 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 Siren Susaki, VP, Investor Relations. Please go ahead, Ms. Susaki.

Thank you for joining us today for Pan American Silver's conference call and webcast to discuss our results for the first quarter of 2025. This call includes forward-looking statements and information and makes reference to non-GAAP measures. Please see the cautionary statements in our MD&A news release and presentation slides for Q1 2025 results, all of which are available on our website. I'll now turn the call over to Michael Steinman, Pan American's President and CEO.

Hello, everyone. I'm glad you could join us to discuss our Q1 results. 2025 is off to a strong start. with Pan American posting another quarter of solid operating performance, building on the momentum from last year. Mine operating earnings have been increasing over each quarter in 2024, and this trend continued for the first quarter of 2025, reaching a record of $250.8 million in mine operating earnings. The improvements in metal prices have certainly contributed to margin expansions But I would like to acknowledge the work of our teams in not only maintaining a focus on safe, efficient operations, but also carefully managing costs in order to deliver the margin improvements that resulted in the record mine operating earnings for the quarter. La Colorado is contributing strongly to these results. The improvement in mine ventilation conditions has allowed us to accelerate development rates and increase the number of production areas, which is leading to higher throughput and lower per unit costs. In Q1, we produced just over 5 million ounces of silver production, slightly above our guidance range for the quarter. On cost, the performance was even better, lower than anticipated production costs across the silver segment contributed to all-in sustaining costs of $13.94 per ounce, well below our guided range. The low silver segment all-in sustaining costs also benefited from higher than expected byproduct credits, from higher gold production at Cerro Moro, and higher zinc and lead production across our polymetallic operations, as well as some lower capital expenditures. Gold production in Q1 of 182,200 ounces was in line with our guidance, while gold segment all-in sustaining costs, excluding NRV adjustments of $1,485 per ounce, were better than expected. The main drivers of the strong cost performance in the gold segment were higher than expected gold and silver production from residual leaching at Dolores and higher silver byproduct credits at El Peñon. Revenue in Q1 was $773 million, while net earnings in Q1 totaled $169 million, or 47 cents per share. Adjusted earnings were $153 million, or 42 cents per share. Operating cash flow before non-cash working capital changes was $240 million, including $95 million cash taxes. The taxes paid in Q1 represent roughly one-third of the cash tax we expect to pay in 2025. After working capital changes, operating cash flow totaled approximately $175 million. At the end of Q1, our cash and short-term investments increased to a record balance of $923 million, and free cash flow for the quarter was $112.6 million. Keep in mind that this increase in cash over the quarter is net of the $95 million in taxes paid, $81 million invested in our sustaining and growth projects, inclusive of lease and loan payments, and $56 million we return to shareholders through dividends and the share buyback. The cash generated by our operations fully funded our business needs, provided returns to shareholders, and further improved our balance sheet. Including our undrawn line of credit, we have approximately $1.7 billion of total available liquidity, which gives us plenty of capacity to pursue our growth objectives. Our largest organic growth opportunity, the La Clarada's corn project, continues to move ahead. Over Q1, we advanced engineering work and continued with exploration and infiltrating. We're also continuing to discuss potential partnerships for development of the project. We expect those discussions to take several quarters given the size and long life nature of the project. Our aim is to retain maximum exposure to the silver in this deposit. We're also investing at the LaGuardia vein mine operations to explore extensions to the mineral resource in the higher-grade Candelaria zone to the east and southeast of our current operation. At Escobar, Pan American had four working meetings with the Guatemalan government during Q1 2025 as part of the ILO 169 consultation process. Currently, there is no date for the completion of the consultation process or the potential restart of operations at Escobar. The comprehensive mine and plant optimization studies at Jacobina are progressing well, and we expect to include the findings of the first phase in early August 2025. The initial findings will include evaluations of modifying mining and tailings disposal methods to maximize the long-term value for this flagship asset. In closing, 2025 is off to a very strong start. Operating performance is in line or better than expected, and our forecast shows higher production over the balance of 2025, as per the quarterly guidance we provided in February. We are maintaining the guidance we provided in February for consolidated production, cost, and annual expenditures. That outlook, combined with today's favorable precious metal prices, points to the potential of generating very strong profit margins this year. We generated $112.6 million of free cash flow in Q1 alone, and gold prices are currently trading substantially higher than the average in Q1. This is an incredibly exciting time to be impressed with metals and invested in Pan American. I would now be happy to take your questions together with the other members of our management team.