Aura Minerals Inc

Good morning, ladies and gentlemen. Welcome to first quarter 2026 earnings call. This conference is being recorded and the replay will be available at the company's website at rminerals.com slash investidores. The presentation will also be available for download. This call is also available in Portuguese. To access, you can press the globe icon on the lower right side of your Zoom screen and then choose to enter the Portuguese room. After that, select Mute Original Audio. Para acessar nossa conferência em português, clique no ícone do globo ao lado inferior direito da sua tela Zoom e selecione a opção Portuguese Room. Ao acessar a nova sala, certifique-se de mutar o áudio original. we would like to inform that all attendees will only be listening to the conference during the presentation and then we will start the question and answer section when further instructions will be provided. Before proceeding, we would like to clarify that any statements that may be made during this conference call regarding the company's business prospects, operational and financial projections and goals are the beliefs and assumptions of our Executive Board. and the current information available to the company. These statements may involve risks and uncertainties as they relate to future events and therefore depend on circumstances that may or may not occur. Investors should be aware of events related to the macroeconomic scenario, the industry, and other factors that could cause results to differ materially from those expressed in their respective forward-looking statements. Present at this conference, we have Rodrigo Barbosa, President and CEO, and Kleber Cardoso, CFO. Now, I will turn the conference over to Rodrigo Barbosa. You may begin your conference, sir.

Sure. Thank you. Thank you all for this first part of the year. As always, I'll be talking about summary of the results and strategic movements During this portion, NCLAB will follow with more detailed information about the financials and cash flows. Before I start, I think I would be good to recap that this was a very solid quarter for us, where I can show to you that we move forward under the three avenues that we propose to deliver value to our shareholders, and this story has been shared with the market since 2020 and reinforced since the NASDAQ listing last year. We're going to build value to our shareholder by three different avenues. Number one, we're going to increase production. We're going to develop green fuel projects and reach over 600,000 ounces after all the process are developed. Number two, we still have a significant area unexplored and room to increase life of mine. So we should also see, together with improvement and increase in production, a significant increase in resources and reserves along the next few years. And number three, we should tackle also our price per NAV multiple through growth and also improving our daily trading volume to the market. So what I'm going to share with you during the next few slides is a factor that consolidates solid steps towards these three avenues. So, we jump into the first slide. So, in summary, again, we reached a new record high production as we already disclosed to the market. Of course, now including MSG acquisition that was last year including only in December reaching 82.1,000 ounces of gold equivalent ounces. And then that together with the higher gold prices, some $380 million in terms of revenues. Now, when we add, comparing to first quarter last year, Borborema, that was still beginning to ramp up, then now full year of Borborema, stable productions in our mines, plus MSG, we're going to see higher gold prices. We see the EBITDA three times higher than the first quarter last year, now reaching the $244 million, another record high EBITDA for the partner. Together with our EBITDA, then we can see the all-in sustaining cash costs reaching $1,829. This is a significant increase compared to last quarter's. mostly because of now we are consolidating MSG. And as we disclosed to the market since early stages in the acquisitions, we understand that MSG has a higher oil interest than cash cost and will be higher during this year once we are focused on the turnaround, preparing the mine and to put our production levels above 80 or close to 80,000 ounces. And only sustaining cash cost goes to $2,000. But during this first quarter, and actually during the second quarter also, we should see MSG with a high all-in sustaining cash cost when we are focusing on our underground preparation, underground safety standards, underground development, so that we can prepare this mine for a better production. throughout the Q3 and then Q4, and even better than next year. And I will talk mind by mind and then following slides. So, higher EBITDA also translated in the strong recurring free cash flow, now reaching $95 million, which is 109% higher compared to less important. This strong recurring cash flow, Recruiting cash flow of $95 million, stronger even after a payment of $33 million on hedges due to the Borborema, which is a non-recruiting, but should happen this year and should also happen next year, and a temporary working capital consumption of $42 million. And Cleber is going to walk you through in more details about the decision from EBITDA to free cash flow. In terms of net debt, super stable despite the payment of $55 million during the quarter regarding the last quarter of last year. Investment also in production. We saw a company that has been able to grow and pay solid dividends while maintaining a very low net debt to EBITDA ratio. We are stable in that debt, and that continues to increase. We see the leverage of the company actually being deleveraged after all the growth acquisitions, payment dividends, and strong results from our mines. In terms of net income, as now we see, Unfortunately, this quarter, there was not a significant higher gold price as we were seeing in the last quarters along the year 2025. That translates into lower market-to-market losses in terms of the gold hedges. So, that translates into $95 million of net income. And Kleber is also going to walk you through in more detail. how we got to the 95, and also see what would be the adjusted net income without the non-recurring events. As we continue to grow, as we continue to grow EBITDA, we have no leverage, and margins continue to improve. Now we see room to maintain a high level of dividends to our shareholders, another record high dividends now reaching $65 million of dividends, or 0.76 cents per share. And then you add the dividends we paid in Q2 last year, Q3, Q4, and now this Q4, we see that the last 12 months on the quarterly basis, reaching 4.6% of dividend yield. And as we progress in the production, as we progress during the second semester, we're going to see a higher production compared to the first semester. then we need to think that we can continue to pay, to distribute a significant amount of dividends to a shareholder without jeopardizing the growth plan that we have. As additional events, and that we reinforce the three pillars that I mentioned to you earlier this call, we see that our, sorry, that we have, or growth plan continue to be super solid. Number one, we got the agreement signed by the need to move abroad that unlocked significant amount of resources and reserves in Borgorema, increasing the life of mine to 36 years now. Of course, we don't want to, we prefer to have a lower life of mine and higher production, so that's why We've been disclosed to the market that we are now finalizing all the studies to increase significantly the production of Borborema so that it can actually then stretch a little bit more and decrease the life of mine with increased production of Borborema. And we are finalizing all the studies and should we have any news to the market between now Q2 or Q3 this year. Very important milestone. is that we updated our resources and reserves on the report 20F. That was a significant addition of reserves, adding 3.8 million ounces of proven and probable, and also reaching, when you add proven and probable, also with the margin indicator, you're going to see that you can get close to 10 million ounces in our inventory for the long period. That's a significant increase compared to what we had before. While we continue to do exploration investments and see also room for further improvement in our resources and reserves as we move along the next years. A very important project, Era Dourada, earlier this year, as we shared with the market, we got the license to initiate the construction. That was followed by a full board approval to initiate the construction of Era Dourada. Then we are in full force for the year. And CapEx will be divided between this year and next year. And then we expect production to come now in 2028. So we talked about how we increase production. We'll go back to the other slide. So we talked about that we increased production. Last year we had the Borborema ramp up, actually this quarter we continue to increase a little bit more in terms of production. So that's the growth of this year. We come from last year of 284,000 ounces of production. This year, the guidance is between 340 to 390. So we continue to grow by developing the project and doing acquisitions. Second, we increase significantly our resources and reserves. And third, to tackle the price NAV, we know that we had to address daily trade involvement combined with a solid walk in the talk and delivering on the projects and growth. So we could see that obra is narrowing a little bit the gap of price per NAV, while you still have a lot of room to continue to narrow this gap as we maintain a high daily trading volume and continue to grow. There is a very strong correlation between size and price per NAV in the gold sector as we come from, in the past, 200,000 ounces of production, now on guidance 340 and 390, and we know how to get close to 600. We should see this continue growing. narrowing the gap of price per NAV. One of the factors has been well accepted by the market and widely amplified when we listed in NASDAQ is that we are now trading $94 million. That was the daily trading volume on the last average on last quarter. Compared to last year, quarter of last year, $31 million. And if I remind investors that where we were One year ago, it was $2 million per day. Now, we are on average $94 million per day, which is now attracting very large and more sophisticated investors that now pay attention to our and now also invest in our portfolio. Next slide. In terms of safety, after a long time without any lost time incident, unfortunately, we had the lost time incident in Port Borema. There was a maintenance on the filter. We are reinforcing all the procedures. There was not followed some of the procedures, so we are reinforcing training all the managers and all the maintenance team in order to follow the procedures and reinforcing the standards. This person is already back to work. There's no major injury. However, there was some lost time incidentally related to that accident. In terms of Stabilical structures, again, all geotechnical structures are in satisfactory level. So on the left side of this slide, we can clearly see on the line on the left side shows the last 12 months of production, as we are now increasing, getting from the standard of 60, 65, between 60 to 70,000 ounces of production that happened during the 24, 25. Now with Borborema and then MSG, we are now increasing to levels above 80,000 ounces and perhaps reach close to 90,000, even above during the second semester. which is now the last 12 months, ramping up our production coming from 265 that was on field three 2015, 280, 302. And we should see these last 12 months continue to increase as we are very comfortable in line with the guidance that we set to the market to finish the year between 340 and 390,000 ounces of productions. In terms of mind by mind, where we saw, which was expected, and due to the mind sequencing, due to the budget and the guidance that we sent to the market. At Aranjo Azul, we are now going to lower grades through this quarter. We should not expect a significant improvement through the second quarter, and then some improvement during the second semester in Aranjo Azul. That's the same that happens in Apoena, that Apoena can relate it to other years, where we start the year normally slower. and then production pick up during the third and fourth quarter. Minossa is super stable. It's just a rounding number here from 18 to 17, but it's actually 2% of decrease compared to Q4, and we should continue to see stable production in Minossa, and perhaps some improvement during the second semester. Almas, we continue to have a strong production at 15,000, 16,000 production, and implementing an investment where we are increasing the capacity of ALMAs to reach up to 3 million tons per year by the end of the year, while we are doing underground development so that we can, along the next year, continue to improve efficiency and also production in the project, while exploration efforts on the near mine and on the regionals, continue to give us strong indicators that this mine is not only going to have a very extended life of mine, but be able to even expand above the 3 million tons per year. Morborema, we had a stronger quarter compared to last quarter, mainly due to a high throughput, stabilization of the milling process, stabilization of the filter, There's still some room to improve production for the second CMS. MSG, this increase is mainly due to we are now consolidated three months compared to December last year. That was only one month. We should not expect MSG to improve. Actually, we expect MSG to decrease production during the second quarter. Why? We are totally focused. building the infrastructure underground in order to prepare this mine to do the proper production for the 27th year. So what we should see on Q3, Q4, productivity improving, costs going down, and also production going up, but not on the second quarter. Next. In terms of how we're sustaining cash costs, we see that reached in 1829 compared to 1521. If we were not by MSG, that is a position that we understand that would have a higher all-in-sustaining cash cost along the year of 2026, that's because we paid only $76 million on this mine. We understand that they had to go on the turnaround process. If in one hand, all-in-sustaining cash cost is above as expected, On the other hand, the underground development is being well within our expectations and significantly higher than what this mine was performing in the past. For example, the advancement on the underground tunnels, when last year it was close to 35, 36 meters per month, now we are reaching 60, 65 meters. So the efficiency that we want to implement underground to do preparation for our higher production is moving as fast as expected, sometimes even faster than we expect. So that if you take out the MSG, which should pollute our average during first quarter, second quarter, along the full year, then we would have been only sustaining cash costs close to $1,500 per ounce. Next. Very importantly that happened also during the quarter is Terra Dourada project that now we have a full approval. This is an outstanding project that is getting attention from many stakeholders in the world because of its potential to be one of the highest standard in ESG. Why I say so? Because this project is going to put many different variables in the same and learning from other mines in the same project. Number one, we bought a bluestone combined with a geothermal project. So this project, as we develop the geothermal project that is coming in the upcoming years, we'll have a renewable access to energy. And actually, we are thinking about increasing the megawatts in order to supply Guatemala with extra energy and with the renewable energy. Number two, we understand that clean water and treated purified water is an issue in the area. There's not many, if there is any, if any municipality that has a purified water, we will use the water that we have on the ground that we would have to treat any way in order to put this water back to the rivers. We are now improving and we approved additional investments on water treatment in order to have this water as purified and potable to the city, so we are now negotiating and offering the municipalities and the communities a possibility to have access to a potable water. renewable energy and clean water for the population, together with all the local training and focus on having local people working with us, local suppliers. And if we don't have suppliers, we train them, we form them, so that we can improve the conditions of living for everyone that is around us. In terms of production, there's a project that starts on the feasibility study that we mentioned, with annual production 111,000 ounces, yet with potential to further access upside, as we've been doing in Almas, as we've been doing in Borborema, we understand that Eldorado also has room for further upside as we move forward in the operations, as we more implement the project and go to commercial production. Another very important factor is that the significant increase in terms of reserves of this project that when we acquired as an underground it was close to a million ounces. Now we have 1.7 million ounces in terms of reserves and yet with some potential on the regional side to increase resources and reserves. Next slide. So I talked about Grand Path of Barborema now reaching record high production. That's a significant increase of production profile last year and this year with also lower all-in sustaining cash costs. Number two, now I'm going to share with you about increasing resource and reserves, and we saw a major change in our inventory in reserves and reserves. and resources coming from the last report that we applied on F1 for the Nasdaq listing was 3.4 million ounces in terms of reserves. Now we are reaching 7.2 million ounces. This is more than double the size of the reserves in one single year. Meanwhile, we come from resources of 4.6 million ounces down to 3.1, but that's a very good news because we converted 2.5 million ounces of resources are merit-indicated into proven and probable. If you add this back to the 3.1, you would see that we also continue to increase merit-indicated. So this is a major milestone that is helping us to improve our life of mine while we are also increasing production per year. Next slide. So I talked about increasing production. I talked about increasing resource and reserves. And now an important factor also to tackle the price per NAV, which is the daily trading volume. As I mentioned earlier, we come from $2 million, $3 million, $4 million per day. And long after the listing, then we started reaching $30 million. $40 million, and now we are, last month, we closed April with $120 million per day in daily trading volume, and on average, close to $95 million on the first quarter. So that is attracting way more quantity and quality of investors to our portfolio. So I'll turn now the presentation to Kleber, and I'll come back for Q&A.

Thanks, Rodrigo. Good morning, everyone. So I'm going to go over the summary of the main financial KPIs for the quarter. What we can see in the summary is an improvement in basically all of them, with revenues a new record high, closing the quarter with $383 million. Now, the last 12 months, we have exceeded revenues of $1.1 billion, and going forward, we expect this trend to continue. When we see the adjusted bias, Rodrigo commented before, we have a report for the sixth quarter in a row, a record high again, a substantial increase compared to 425, but mostly because a higher average world price in that quarter. so $244 million in the quarter, and now exceeding $700 million already in the last 12 months, also a trend that we expect to continue. When we analyze the net income, we see a substantial improvement compared to the last quarters. That's a combination mainly of two factors. First is the improvement of the operational results, and second is on this quarter, gold price decreased. increased between the beginning and the end of the quarter, but at a lower rate than the increase we had in the last few quarters. So, as a result of that, we had lower market-to-market losses with gold hedging derivatives that is impacting less our P&L this quarter than previous quarters. Later, I'm going to go over more detail on this as well. But with that, we are reporting $95 million in net income and then $190 million in adjusted net income. In terms of cash and net debt, mostly stable compared to the year-end. We closed the quarter with $115 million in net debt. And we see an important reduction in the financial leverage of the company as a result of stable net debt and increasing accumulated EBITDA. uh our net leverage coming from 0.28 to 0.16 at the end of this quarter uh now we uh just to understand the main items between the uh adjusted digested net income uh for this quarter uh out of the the 244 uh million dollars adjusted We see the three larger gold mines contributed the most. Borborema had the highest EBITDA, as we were already anticipating, $61 million. Minoz and Almas coming strong as well, $58 million and close to $50 million, respectively. Arandazu, Also strong for $1 million, Apoena, which we expect a much stronger second semester than the first semester, but already contributing with $24 million. And MSG, despite we're just starting the turnaround, so contributing as well with $17 million ended up for this quarter. Depreciation and amortization, it's been in line with our expectation. It's been increasing in the last two quarters, basically, because we added two new operations, Burborema Commercial Production in Q4-25, and now MSG, a full part of production in 2026. The net financial expenses, once again, the main items are the non-realized and realized losses with the gold derivatives. the new realized portion of $24 million, and we paid $33 million with realized losses. So combined, it was $55 million compared to over $100 million we had in losses with derivatives in the last quarter. So that explains a portion of also the improvements in our net income. Income tax expenses coming as well as expected, considering strong results from the operations. Some small other expenses bringing the net income to $95 million. And then here to the right side, we excluded the typical no-cash items, the unrealized portion of the losses with the good derivatives, some no-cash impact in the free tax income. excluding those items that just the net income would have been 109 million dollars by the end of the quarter and here we we bring a detailed analysis of the change in the cash position of the company throughout the quarter we see on the red and the left side here we start with close to 290 million dollars in cash Here, on the left side, we have what we call the recurring free cash flow to firm, which is the cash flow generated now by the six mines in production. That portion of the business generated $95 million. It's pretty much stable compared to the previous quarter, but mostly there are two Items that consume the cash proportionally higher in the first quarter than we expected for the rest of the year versus working capital. We have some temporary increases in accounts tables and inventory in this quarter that should improve in the next few quarters, and also income tax payments, where we paid $52 million today. In the first quarter, the first quarter is usually the quarter that we paid most of the taxes, where you have annual tax adjustments, especially in Mexico. So that will not repeat in the same proportion during the rest of the year. Then in the middle of the chart, we see the investment for growth, where we invested $26 million, mostly in expansion cap, including Era Dorada. The CAPEX, especially the expansion CAPEX, is one that we expect to increase throughout the rest of the year, especially as we advance in construction of Era Dourada and also in the expansions in ALMAS. And then here to the right side, we see how we are locating cash in the financial items. We paid close to $20 million in gross debt, reducing the gross debt of the company. and distributed $55 million in dividends, ending our cash close to $207 million by the end of the quarter. With this, we end the presentation. I'm open to questions. Thank you.