United States Antimony Corporation

Greetings. Welcome to the United States Antimony Corporation Calendar Year 2023 Results Webcast. At this time, all participants are in a listen-only mode. 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, Gary C. Evans. You may begin.

Hello, thank you, operator, and thank all of you for dialing in this afternoon. And we look forward to updating you on the activities at U.S. Antimony. I have with me today Joe Bargewoods, who is a board member and a co-CEO with me, as well as Rick Isaac, who is our senior VP and chief financial officer. So there will be three of us today participating in this call from management and the board. Let me first start out by telling everyone, you know, 2023 was truly a year of transition. To give you a few high points here, we added two new board members to our corporate board, Mike McManus and Joe Carraba. We also had four board members resign. Russ Lawrence, the former president, Hart Betas, Tim Hasara and Gus Gustafson. So there's been a major shift in the board that occurred last year during different times. Um, we currently have today a five member board, uh, two of which are now management as well being, uh, Joe Barchwood and myself. Um, Russ Lawrence, the president resigned in July. And so it wasn't until that time that really. the board took a much more active role in managing the company. Gus Gustafson, who's been with the company a long time, resigned as CEO and is now president of our Antimony division. Joe Bartswith is, as I mentioned, an existing board member. He's now co-CEO along with myself. And of course, Rick, as I mentioned, joined as senior VP and CFO. We also added a controller, a gentleman by the name of Mike Ussery came on board last year. We have a new vice president and general manager at Bear River, which is our zeolite facility up in Preston, Idaho. His name is Jeff Fink. And we also have a new plant superintendent at Bear River by the name of Nick O'Neill, who just started about a week to 10 days ago. So lots of changes at the board, at the management and, um, We think all of these changes are going to be for the benefit of our shareholders. I would like to take a minute now and talk about our financial performance for 2023. It wasn't a pretty picture, but the changes we've made will have dramatic effects going forward. We released this on Friday of last week. And so with that, I'll turn it over to Rick Isaac, who will give us a presentation. Rick.

Thanks, Gary. As Gary described, we made some changes to our company that we believe improve it. Let me first talk about three of these changes before I get into the financials. On March 11th, 2024, we shut down our Mexico operations, which was primarily our Madero and Puerto Blanco plants. After this shutdown, we terminated the majority of the employees, which cost about $40,000. The remaining 14 employees in Mexico are helping to close the operations, securing the buildings, closing the books, and performing other administrative functions. Once these functions are complete, we'll have some additional terminations. Some of the factors that led to our decision to close Mexico Our Mexico operations include the following. While our Mexico operations did contribute to our antimony sales, their contribution was under 15% in 2023. In addition, we're finding new sources of antimony ore for our Montana processing plant. Finally, these operations in Mexico have been a drain on cash since inception of over $50 million. All right, second item. During 2023, we made additional investments of about $1.3 million to improve our machinery, equipment, and plant at our Bear River Zeolite facility in Idaho. This includes a new cone for our cone crusher, several salt sheds to store and keep ore dry before processing, which is especially important during winter, several warehouses to store finished product for quicker customer shipments, many building improvements like better lighting, heating, conveyors, and improvements to our shop where we perform repairs and maintenance on our vehicles. Third, as Gary mentioned, we added personnel to our staff, our management team, and our board of directors that we believe will help improve our company going forward. Our personnel are our most valued asset, and we have changed the focus of our personnel and our company to thoroughly analyze initiatives and move forward with initiatives that create shareholder value. These are just some of the changes we made to improve our company, and more will follow in the future. Switching to the financials, let's first review our cash flow during 2023. Cash and cash equivalents and restricted cash decreased $7.2 million during 2023. $4.1 million of this decrease was due to cash drained from our Mexico operations. which relates primarily to operational losses of $5.9 million and inventory purchases of $1.8 million, partially offset by $3.6 million of non-cash charges, which related primarily to inventory write-downs, VAT receivable reserves, and depreciation and accretion expenses. These are the operations we shut down on March 11, 2024. 1.1 million of the 7.2 million cash decrease was due to payments we made on liabilities that had been accumulating from prior years. The majority of this 1.1 million relates to a dividend paid to our Series D preferred stockholders. This preferred stock has been converted to common stock, and this dividend has been eliminated going forward. Finally, 1.5 million of this 7.2 million cash decrease related to CapEx spending. The majority of this spending was made to improve our machinery, equipment, and plant at our Bear River Zeolite Facility in Idaho, as I mentioned earlier. Overall, we eliminated much of the drain on cash from 2023, and our cash position remains strong in the first quarter of 2024. Next, let's take a look at the income statement. Sales decreased 21% in 2023 compared to 2022. 44% of the sales decrease was due to the decrease in the sales price of our antimony sales in 2023 versus 2022, which was primarily due to the decrease of the antimony market price. Obviously, we don't control the antimony market price, but we do try to manage our costs in relation to it. The other 56% of the sales decrease was due to volume decreases. which was primarily due to the decrease in the tons of zeolite sold. Our Bear River zeolite plant had significant downtime in 2023, about 18 weeks, which caused lower sales in 2023. As I mentioned, we made investments in 2023 to strengthen our mining and processing of zeolite and prevent downtime, and we will continue to do this going forward. Gross profit decreased as well in 2023 compared to 2022. Obviously, the sales decline impacted our gross profit adversely in 2023. Also, our Mexico operations experienced higher processing costs in 2023 as they continue to process ore with a low percentage of contained antimony. This issue was eliminated with the shutdown of our Mexico operations. They also reserved for some VAT receivables in 2023. These higher processing costs and reserves decreased gross profit. In addition, our Bear River zeolite plant incurred more inefficient maintenance and labor costs in 2023 with the increased production time, which lowered gross profit. Our antimony plant in Montana had lower gross margin on sales of purchased antimony trioxide which also lowered gross profit in 2023 versus 2022. That's it for now on the financials. I'll pass it back to you, Gary.