Amerigo Resources Ltd.

Good afternoon. My name is Sylvie, and I will be your conference operator today. At this time, I would like to welcome everyone to the Amerigo Resources Q2 2024 Earnings Conference Call. Note that all lines have been placed on mute to prevent any background noise. After the formal remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star then the number 1 on your telephone keypad. And if you would like to withdraw from the question queue, please press star then number 2. Thank you. Mr. Graham Farrell of Harbor Access Investment Relations, you may begin the conference.

Thank you, Operator. Good afternoon and welcome everyone to Amerigo's quarterly conference call to discuss the company's financial results for the second quarter of 2024. We appreciate you joining us today. This call will cover Amerigo's financial and operating results for the second quarter and the June 30th, 2024. Following our prepared remarks, we will open the conference call to a question and answer session. Our call today will be led by America's President and Chief Executive Officer, Aurora Davidson, along with the company's Chief Financial Officer, Carmen Amesquita. Before we begin our formal remarks, I would like to remind everyone that some of the statements on this conference call may be forward-looking statements. Forward-looking statements may include, but are not necessarily limited to, financial projections for other statements of the company's plans, objectives, expectations, or intentions. These matters involve certain risks and uncertainties. The company's actual results may differ significantly from those projected or suggested by any forward-looking statements due to a variety of factors which are discussed in detail in our CDAR filings. I will now hand the call over to Amara Davidson. Please go ahead, Amara.

Thank you, Graham. Welcome to Amerigo's earnings call for the second quarter of 2024. All dollar figures reported in this call are U.S. dollars, except where we specifically refer to Canadian dollars. The fundamental driver for America's strong financial performance in the second quarter was sharply rising copper prices, which averaged $4.39 per pound for NBC compared to $3.95 per pound in Q1 2024. In this price environment, it was a good quarter to be a copper producer, but a great quarter to be an Amerigo shareholder. Amerigo posted a net profit of $9.8 million, EBITDA of $22.3 million, operating cash flow before changes in working capital of $14.3 million, and free cash flow to equity of $6.7 million. This happened during the quarter when we completed our planned annual eight-day maintenance shutdown. During the quarter, we also absorbed the impact of one million pounds of reduced production due to severe rains. In other words, this tremendous financial performance occurred during what we expect to be our lowest production quarter. And please remember that we have maintained our annual production guidance of 62.4 million pounds of copper. Cash on our balance sheet grew considerably in the second quarter to 28.7 million. Our restricted cash level was 4.2 million and we reduced our debt to 15.5 million. We also substantially reduced the company's working capital deficiency to 1.5 million down from $12.3 million at year-end 2023. Not only were copper prices significantly stronger during the quarter, but NBC also managed its costs well. Our quarterly cash cost was $1.96 per pound, and we have a normalized cash cost of $1.92 per pound for the first half of the year. These are below our cash cost guidance of $2.08 for the year. During our last earnings call, I mentioned that we were building up our cash position to the desired target of $25 million and that once there, additional cash would be distributed to shareholders via performance dividends, share buybacks, or a combination of both. We hit the target, and I think we did it faster than many realized we could. Our stronger financial position resulted in the declaration of Amerigo's first performance dividend of four Canadian cents per share, which will be paid on August the 6th. This initial performance dividend demonstrates Amerigo's unique ability to share the benefits of solid copper prices with investors quickly. To close my comments on our performance, let me offer a high-level view of the first half of 2024. We met production guidance and beat cost guidance. The average MBC copper price in the first half of the year was $4.16 per pound, which enabled us to generate net income of $14 million, EBITDA of $35.9 million, and free cash flow to equity of $14 million. There were no lost time accidents or environmental incidents at NBC. The change from El Niño to La Niña has tempered weather risk. We had no rain in July, but we have some heavy rain forecasted for tomorrow. We also have ample water reserves. Looking forward, we expect normal operations at NBC for the year's second half. As you know, Amerigo has now fully deployed the three tools of its capital return strategy, quarterly dividends, performance dividends, and share buybacks. Amerigo's initial performance dividend was announced on July the 9th, which means that shareholders will receive at least $0.16 Canadian this year, a 10.3% yield based on today's share price. We know of no other copper equity investment with an attractive, predictable base dividend yield as we offer, but we don't stop there. One other copper equity investment has also implemented additional and powerful mechanisms, such as our performance dividend, to spontaneously return extra cash to shareholders. America's performance dividend is a flexible tool regarding timings, frequency, and the amount of capital we can return to shareholders. For example, our initial $0.04 Canadian performance dividend is greater than one of our regular quarterly dividends of $0.03 Canadian, and this was possible after only one quarter of strengthening proper prices. The unpredictability of performance dividends is meant to encourage and reward patient holders of our shares. The opportunity cost of missing a performance dividend is high, which provides an extra incentive to tuck away Amerigo shares and ignore market volatility. If you are new to the Amerigo story, performance dividends are only one of the three tools of our capital return strategy. When deployed, all three have an immediate, positive impact on shareholders, and currently they are all deployed. As you can see, Amerigo's return to shareholders is happening now as copper prices start to rise, not in the distant future. Let me give some observations about the global copper markets and America's place in them. We cannot predict the average copper price in the remaining months of 2024. However, we can state with certainty that the challenges involving the supply and demand dynamics for coppers have not changed since our last call. We remain confident that copper prices will continue to strengthen over time. The recent copper prices of around $5 per pound were too short-lived to move any investment decisions to bring new copper supplies online. Although copper prices above $4 are excellent news for America, that is still a territory where the incentive price for new copper investments has not been reached. When the incentive price is reached, the world will still need to develop mines from discovery to production. The world needs more than just ground-filled expansion of existing mines. The most recent report on this topic, published by S&P Global in June 2024, indicates that copper mines are some of the slowest to develop from start to finish, taking an average of 16.2 years. S&P also recently stated that their studies show the world will need to produce more copper in the next 12 years than in the previous 120 years. Without this copper, the energy transition will not be achieved. The magnitude of attacks this size cannot be overstated. In our opinion, both statistics point to higher future copper prices. S&P is not alone in recognizing the bullish scenario for copper prices. The most recent 2024 forecast from JP Morgan shows a 0.7% growth in copper mine production, a 2.5% growth in refined copper production, and a 3.2% growth in refined copper consumption. What does this mean? It means that the forecasted tons of refined copper consumption are projected to be 15% higher than the projected copper mine production. This will again drain the world's copper inventories and tighten the markets, leading to upward pressure on copper prices, as we saw in the second quarter. Yes, in the short term we are seeing some price volatility. Physical copper inventories in China are not coming down at the same rate as they usually do after mid-year. At higher prices, there is also an appetite to tap into copper scraps to the greatest extent possible. Still, the expectation is that even if muted, demand will continue to outstrip the supply from copper mines. Against this backdrop, Amerigo is uniquely positioned. We have a long-term business at NBC that produces additional copper for Chile. NBC has excellent operating performance and generates operational cash flow predictably. Excess cash flow can be quickly, flexibly, and efficiently returned to shareholders. We think that we're only just starting to see the beginning of a secular rise in copper prices. Copper prices briefly broke through the $5 mark in the second quarter, primarily due to strains on global supply. The initial demands of global electrification have barely started. To conclude my remarks, American shareholders do not need to hope for higher future share prices to make money. They can rely on the business outcome of a solid copper-producing operation with a consistent pattern of secure quarterly dividends. American investors already receive significant and tangible returns with every quarterly dividend. With performance dividends, such as we recently declared, American investors are poised to receive even higher returns as copper prices increase further. And as I said before, these are good times for copper producers and great times for Amerigo shareholders. I will now ask Carmen Amezquita, Amerigo's Chief Financial Officer, to discuss the company's financial results. Carmen, please go ahead.