10/29/2026

speaker
Operator
Conference Call Operator

Good morning. I'll now turn the call over to Scott Parsons, Alamos Senior Vice President of Corporate Development and Investor Relations.

speaker
Scott Parsons
Senior Vice President, Corporate Development and Investor Relations

Thank you, Operator, and thanks to everybody for attending Alamos' third quarter 2026 conference call. In addition to myself, we have on the line today John McCluskey, President and Chief Executive Officer, Greg Fisher, Chief Financial Officer, and Luc Guimond, Chief Operating Officer. We will be referring to a presentation during the conference call that is available through the webcast and on our website. I would also like to remind everyone that our presentation will be followed by a Q&A session. As we will be making forward-looking statements during the call, please refer to the cautionary notes included in the presentation, news release, and MD&A, as well as the risk factors set out in our annual information form. Technical information in this presentation has been reviewed and approved by Chris Bostwick, our Senior Vice President, Technical Services, and a qualified person. Also, please bear in mind that all of the dollar amounts mentioned in this conference call are in U.S. dollars unless otherwise noted. Now, John will provide you with an overview of the quarter.

speaker
John McCluskey
President and Chief Executive Officer

Thank you, Scott. We produced 119,000 ounces of gold in the third quarter in line with quarterly guidance with record production from the Island Gold District offsetting lower planned production from Young-Davidson. The Island Gold District continues to perform well with both underground mining rates and Maginot Mill throughput rates setting new quarterly records. Underground mining rates increased to average nearly 1,800 tons per day in the quarter and the Maginot Mill averaged over 10,000 tons per day. We expect a further increase in Island Gold underground mining rates as well as higher grades to drive a 26% increase in consolidated production in the fourth quarter, putting us on track to meet our revised annual guidance. As previously guided, all-in sustaining costs increased from the second quarter due to lower production and timing of sustaining capital spending. With the Island Gold District expected to drive costs lower in the fourth quarter, we are well positioned to achieve our four-year consolidated cost guidance. Financially, we generated strong free cash flow of $76 million this quarter, net of our reinvestment in high growth and exploration. We are on pace for another year of record free cash flow while continuing to advance our growth projects. During the quarter, we returned $22 million to shareholders through our quarterly dividend and ongoing share buybacks. We remain active on our buyback, repurchasing an additional $17 million worth of shares in October thus far, bringing our year-to-date shareholder returns to $123 million. We continue to eliminate gold hedges inherited from the Argonaut Gold transaction, having repurchased 36,000 ounces of the remaining 50,000 ounces of forward contracts since the second quarter. Since our acquisition of Argonaut in 2024, we have bought back 96% of the legacy gold hedges, substantially increasing our exposure to higher gold prices. Earlier in October, we received the $160 million anniversary payment related to the sale of our Turkish assets, which further strengthened our balance sheet. With a solid net cash position of over $400 million and strong ongoing cash flow, we remain well positioned to self-fund our growth initiatives and support our increased shareholder returns. Turning to our growth initiatives, we continue to make progress across our assets. Construction of the Lynn Lake project is ramping up as planned and work on the shaft and mill expansion at Island Gold is advancing. With the shaft sink completed earlier this year, our focus is on the shaft bottom infrastructure. During the excavation of the bins in the ore and waste handling system at Island Gold, we encountered a dike that will require additional ground support. As a result, shop commissioning has been delayed by approximately one quarter and is now scheduled for completion in mid-2027, with ramp-up of mining rates to 2,400 tons per day expected in the second half of the year. Turning to slide five, delay does not change our strong long-term outlook. We expect the completion of the shopped expansion at Island Gold in 2027, mill expansion at Maginot in 2028, and Lynn Lake production in 2029 to drive significant growth over the coming years. We remain on track to nearly double our rate of production of approximately 1 million ounces annually by 2030 at substantially lower costs. We have one of the best growth profiles in the sector. This growth is all located in Canada. It's lower cost. are expected to support significant free cash flow growth over the coming years. I'll now turn the call over to our CFO, Greg Fisher, to review our financial performance.

Disclaimer

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Investor presentation