Aya Gold & Silver Inc.

Good morning. I will now turn the call over to Salisha Elias, AYA Gold and Silver's Investor Relations Officer. Please go ahead.

Thank you, operator, and welcome to everyone who has joined AYA's fourth quarter and full year 2024 earnings conference call. Here with me today, we have Benoit LaSalle, President and CEO, Hugo Landry Toroschuk, Chief Financial Officer, Ilyas Ilyas, Chief Legal and Sustainability Officer, and Davide Lalonde, Vice President of Exploration. We will be referring to a presentation on this conference call, which is available via the webcast, and it is also posted on our website. 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 included in our annual information form. Technical information in this presentation has been reviewed and approved by Raphael Beaudoin, IAS Vice President of Operations, and David Lalonde, IAS Vice President of Exploration, both of whom are IAS qualified persons as defined under National Instrument 43-101 Standards of Disclosure for Mineral Projects. I would also like to remind everyone that our presentation will be followed by a Q&A session. With that, I would now like to turn the call over to Benoit Lassalle. Benoit?

Benoit Lassalle- Felicia, thank you very much. Welcome, everybody. Welcome to this Q4 and full year 2024 conference call. I will refer to the presentation that you have. And from page two and three, where we have the forward-looking statement, I draw your attention to our forward-looking statement. Moving on to page four of the presentation and a review of the year, the highlight of the year 2024 is the fact that this Gunder expansion plant has been completed and on budget. For the year 2024, we produced 1.6 million ounces of silver. We're ending the year with $49 million U.S. dollars in cash and restricted cash. And we're also announcing a budget, an expiration budget for 2025, which will be between $25 and $30 million, both covering Gounder and Boumadier. So as I said, we've completed the second mine expansion on budget, which you all know is extremely rare in our industry. We've expanded mining operation. The new mill reached commercial production at the end of 2024. It was on December 30th, 2024 that we declared commercial production as it was expected and it had been communicated. We've completed the underground development, both lateral and vertical, which is something that we do on a yearly basis to get ready for the coming year. We're also finishing the year with a stockpile of 336,000 tons of ore running at an average of 153 gram per ton. This stockpile is being utilized when the mining is a little bit short of the or that we need for the plant. We, you know, we have, we are ramping up the mill to reach steady state capacity. We've already reached steady state many days in a row in January and February, and our goal now for 2025 is to reach steady state capacity on a constant basis. In 2024, we've advanced the Boomagine development. We've completed 107,000 meters of drilling on the main trend and on other targets. We've extended the main trend where we see mineralization to 5.4 kilometers. Also, we announced a new mineral resource update in 2024 in April, and in 2025 in February, we've updated the mineral resource estimate. During the year 2024, we've added 15 permits expanding the Boumadine exploration footprint to over 200 square kilometers, which we've had by year end. We've unlocked in 2024 some non-core gold projects, so we've announced the spin-out of the Amisbi gold project into MX2, a gold exploration company focused on North Africa projects. AYA is the largest shareholder of MX2. And the closing is expected any week, whereby some new shareholders will be putting $16 million of fresh money for the expiration of the MESG and other projects. And in 2024, we've continued to progress all our ESG priorities. A key one was the completion and commissioning of the electrical line. which powers Gounder from renewable energy, wind, and solar. And we've also completed our ESG report with an aim of enhancing disclosure. Taking you to page five, which is Q4 and the full year 2024 Gounder expansion completion with some basic statistics. So if we compare the year 2023 and 2024, you see the silver production is somewhat lower in 2024 by 16%. On the other side, or on the other hand, the ore process per tonne has moved in 2023 from 281,000 tonnes to 358,000 tonnes. So if you look at it on a yearly basis, it's 1,000 tonnes a day, remembering that the main plate capacity of the older plant was 700 ton a day. We were running them around 800 to 850. And we had in December the new plant that kicked in. So when we looked at the ore process for 2024, we were close to a thousand ton a day. The average grade was lower from 2023, where we processed 250 gram per ton. In 2024, the average grade was lower at 171 gram per ton. Mill recovery directly affected by a bit of a lower grade. It was 86% or 87% for 2023. We were at 84% for 2024. You remember that the target, once the new plant is up and running and is at ramp-up capacity, where our goal is to have between 88% and 90% recovery on a steady-state basis. So the revenue for 2024 reached $39.1 million compared to $42 million the year before. The profit and loss of both years were at a profit. We generated a profit of $15 million in 2023. We generated a profit of $382,000 in 2024, which is directly related to the fact that we process lower grade ore coming mainly from the underground line. Furthermore, there was a one-time loss on a charge related to the Mauritania asset, the Tijerit project, and that created a $27 million write-off, which comes from a transaction that we put together four years ago. We did do a deal on TG8, and you will see this in the MD&A, whereby we wanted MX2 to take over the project and bring it to production. But because of accounting rules and disclosure, we felt that we should take a write-down of the full value on our books of $27 million. So it's a one-time impairment charge, which has no effect on cash or cash flow. Moving to page six of the presentation, you have, again, at the top, it just shows you, you know, the major milestone of the year, which was, you know, in Q3, once we were complete, we had completed the construction, we successfully tested the new Merrill Crowe system, which is a brand new system. And we were able to have our first silver pour in Q3, but just from the Merrill Crowe system. in q4 when we received from the epc contractor the plant we started up hot commissioning of the new mill and we were able to declare commercial production on december 30th in early 2025 we also reached same plate capacity which was communicated to our shareholders when you look at some operational highlights you see the year 2023 and the year 2024, and you also see the quarter. But when we look at the year, because I think now for us 2024 is behind us, we did the construction, we build it, we commissioned it, we did the commissioning, we build the Rumpad, and now we are into the ramp up for 2025. But some high-level statistics on the ore mine, In 2024, we mined 444,000 tons compared to 493 the year before. The average grade is 162 compared to 213. The ore process at the plant you see is 358, as I mentioned earlier, compared to 281. The mill recoveries are 84% for this year. And the average grade process at the plant is 171 gram per ton. So the total silver production for 2024 is 1.6 million. The silver sold, total silver sales is 1.5 million. So there is an inventory at year end, the difference of 135,000 ounces. The average net realized price in 2024 was excellent at 26. Obviously now we're more towards 34, but that was a very good year at 26 in comparison to the spot price. The adjusted cash cost per silver ounces, once we made some small correction due to the fact that we were ramping up and we were completely overstaffed, the adjusted cash cost per silver ounces was at $19 compared to 12. We understand that this is not representative of the company going forward. It's just a fact of life as we were getting ready in Q3 and Q4 to really start the new plant. We were overstaffed, we had more equipment, and hence the cash cost was higher than on the previous year, which was on a steady state basis. Moving to page seven, and I think that's where The new beginning is now that the construction is behind us, the ramp up of the plant is being done. The ramp up of the open pit is going extremely well. The open pit is running at 1,500 on average tons per day, and the underground right now is running at 1,000 tons per day. Obviously, we changed the focus of the underground from tonnage to grade. We want the underground to improve its grade. and we want the open pit to give us the regular production that we're looking for to feed the plant. So that's coming along well. The open pit is on all cylinders at 1,500 ton a day, and we expect that to increase and to grow until the end of the year. So the guidance for 2025 is extremely important. Our silver production for 2025 will be between 5% and 5.3%. million ounces of silver of ingot, no more concentrate. So very, very little because historically we were producing 50-50, a concentrate and ingot. As you know, the realized price on ingots is a lot better than on concentrate. So here we are 5.0 to 5.3 million ounces for 2025. And that's assuming the ramp up. So Q1, you know, will be around 1 million and we will have a ramp up till Q4 because there are many items that need to be adjusted at the plant, which is programming and pumps. And so these little things are getting done over 2025 to really come at the end of the year with a plant that is in full steady state and with top recoveries, top availability. So the silver cash costs on an average for the year should be between 15 and 18, and again, that is the average between Q1 and Q4. We expect Q4 to be lower than this because we will have done all of the fine-tuning. Same with the recoveries to average throughout the year 84 to 88, understanding that our goal ultimately is to be between 88 and 90 as per the feasibility study. The average grade is similar in the thinking. between 170 and 200, understanding that the grade in the open pit is fairly straightforward, but the underground where we had some issues in Q3 and Q4 is now improving. And that's why I said the focus of the underground is more now grade control than tonnage control. So we really are pushing to have a better control over the grade. The exploration for the assets for the two projects will be between 25 and 30 million. That's something you recall we review every six months based on results, because if you have a structure and you have more systematic drilling, then sometimes we have more meters. If it's more exploration drilling, you have fewer meters and more geological work. So that's something that we're going to be reviewing as we go forward. You see the major milestone on the chart at the bottom of page seven showing you how the production profile is now changing. Historically, the company was set to produce about 1.6, 1.7 million ounces. Sometimes, depending on high-grade pocket, we did it a little bit better. But you recall the plants were geared to do 700 ton a day, and 700 ton a day or even 800 ton a day, that was geared to give us 1.6 to 1.7 million. And that's exactly what we did in 2022, in 2024. And now we have this major change from 2024 to 2025, where we're moving towards 5.0 to 5.3 million ounces. Moving now to page eight, a couple of financial highlights. You've seen the numbers. Let's go to the year end 2024 and year end 2023. We've talked about the revenue, the gross profit being $5 million for this year compared to $15 million last year. The loss is directly related to the write-off of Tijerit, the $27 million. So when you look at the net loss for the period at $26 million, Effectively, the year, if you do not take into account Tijeret, would come out with a $1 million income, but Tijeret is now a one-time write-off based on the fact that we have no certainty of the outcome. Working cap is at $23 million, a very strong balance sheet with only one debt, which is the EBRD debt, which is $100 million. dollar us which has no capital repayment in 2025 so we are in a very strong financial position the uh the the tg unit is the main element to remember when you look at this financial the impairment of the of 27 million dollar we believe that it was the right time though we are still working on on tj with different possibilities we felt it was the right time to take the right down Going to page nine, which is the reason why we've created value over the last four years when we took over AIA slash Maya in 2020, is the geological upside, the exploration upside. Today, you have a company that has 1,200 square kilometers between Zgoundan, Boumadine, Azégour, and Imitabes. We drilled in 2024. 35,000 meters at Zgunder at the mine. You've seen the results, you saw the results Tuesday and you saw how good those results continue to be at Zgunder. Zgunder is a major system and I'm going to show you the size of the property that we have now. Boumadzine, Boumadzine is an all-star project. We drilled 107 1,000 meters or 107 kilometers last year. We've expanded the main zone, as we discussed, to 5.4 kilometers. We have multiple potential parallel zones. Conductive anomalies have been identified. Now, at year end, we still have 27,000 assays that are pending because we are utilizing all the lab capacity in Morocco. We are helping the labs now increase their capacity so that they can service us faster. And that's being done. On the Gounder Regional, which is very interesting and has tremendous potential, we've completed 10,000 meters in 2024. We've tested Gounder West, Gounder East. We're increasing our understanding of the geology, which is extremely important because we're looking for a lookalike of this Gounder deposit. If we have a lookalike of this Gounder deposit and we are looking for that, we will be able to increase the mine life past the 11 years or increase capacity of the plant and increase total production. So we are using all the tools and methods that are available, geophysics, mobile MT, we're using all the tools available We strongly believe that there is one or two more Zgunder deposits and maybe more. It's just now a matter of, you know, attending to it and getting the job done. And we have an extremely good team on Zgunder Regional. And this means, well, that's been spun out into MX2, and we're going to follow this throughout the year. Going to page 10, you have the picture of the Zgunder deposit. You can see it. It's like a loaf of bread. It's 1.4 kilometers long. It's 20 meters thick. It's 700 meters deep. And now you saw the results that we're showing you here, 2,000 grams per ton over 70 meters. I mean, and it's on and on like that. This is a very, very large system. We just gave you some results this week at the bottom left-hand side, which is the west. And we believe that this is like a baguette. I say it's a loaf of bread, so it's a baguette because we're in Francophone Africa. And the fault that you see on the slide to the west is where the baguette was cut into two pieces. And we've been looking for that second piece. Now, we did check at surface and it wasn't there. So clearly there was a displacement towards the bottom. And if you look at some of the results that we showed, This week, it's showing that the bottom left to the west is showing very nice mineralization. So we're pushing the interpretation, hopefully to find the second piece of this loaf of bread and to see it maybe lower down in continuation with this current structure, but starting from the bottom, touching the granite, which has always been You know, the control rock where we see where the mineralization is. So very interesting project. Lots of new theory behind the geology and a motivated team to find more lookalike geological deposits. But this on page 10 is a 2% or 3% of our properties. And so when we arrived, we had 30 square kilometers five, four and a half years ago. And now we have, you know, 440 square kilometers. So there is definitely a lot of potential to come with a new zone similar to Zagounder Mine. And we have a plant that has the capacity to grow, that has the infrastructure, it has power, it has water, it has a team at site that can take this land and increase its throughput by 30 to 50% quite easily. Moving on to slide 11, and that is the tier one asset that we have called Boumadine. Boumadine, we completed in 2024, 107,000 meters of drilling. We've extended the strike from 4.2 to 5.4. Half of the drilling last year was extending the strike. The other half was drilling other structures. And we have been drilling other structures. And some gave us a resource and were added into the resource update. So we did a mineral resource update in February of 2025, which started from the one we had done in April 2024. And we're now pleased to say that we that Boumadine on the main permit, on the main zone, stands at 452 million ounces of silver. We've complete satellite mapping, all the studies, airborne geophysics, and we've identified many parallel structures on trend to the main zone, north, south, and we've also identified many new structures east, west, that seem to be carrying mineralization, which I'll show you in one minute. Furthermore, in 2024, we've added 15 permits to increase the footprint to 212 kilometers from the original 34. And in 2025, we've added another 500 square kilometer to that. So we now control the district and we've done a lot of work to understand. Slide 12 shows you the mineral update. which was communicated at the beginning of the year. But if we're talking about Boumadzid, we have to talk about the mineral update. So as you can see, we've increased the percentage change in total ounces of silver equivalent. The total indicated went up by 120%. The inferred went up by 19%. But what we need to remember is all this was done in two and a half years. So we've discovered 450 million ounces of silver in less than three years of drilling with 200 kilometers or 200,000 meters of drilling. So this is extremely fast. The discovery cost is around 10 cents per silver ounce, extremely low. It's actually quite unique in our sector. When we've done the resource update, we also realized that 49% is pit-constrained, so it's an open pit. and 51 is underground. So it's like a 50-50 currently project with the underground coming from a couple of pits, sorry, the open pit coming from a pit and the underground being underneath the pit and on that 5.4-kilometer structure. Still open in all directions, south, north, and adept. Going to slide 13, that is the secret pathway to a Tier 1 very unique project. You see here all the permits. In the middle, you see the original permit where we have made the original discovery. You can see this. It's right in the middle. And the geophysics shows us clearly where the VMS system here, the volcanic system, the massive sulfide, which in this case here is pyrite, and we can see it clearly. So look at all these targets. So you have the main system, which is north-south. You have many parallel systems north-south to the east and to the west of the main system. And then around that, you have some east-west structures where we've walked the ground, we've looked at, you know, grab samples, we've looked at the geology. And this is another mineralization type. It's another movement. It's not the first movement where we are north-south with gold, silver, lead, and zinc. The one that is east-west seems to be more copper-silver. So that is what we're looking for for 2025, as we are also increasing the drilling on the main zone. to really fully understand the size of the main zone, knowing that it's continuing to the north, continuing to the south, and it has parallel system. So Boumadline is a very unique asset, very unique project. What you see on slide 13 is our territory, it's our ground, and there are a few little pieces missing, but we're still in discussion with some families to add to the portfolio. So the exploration program, which is where we create value, And if you are with us as a shareholder, it's because you believe in the exploration program. This year, again, we will spend between 25 and 30 million on exploration and development, both at Gounder and at Boumadzine. Boumadzine will see again this year between 100 and 150,000 meters of drilling. Gounder will see between 20 and 25. And all of that is a function of results. If we find a new zone at Gounder, and we need to expand and drill it quickly because it could be another source of ore, we will be there and we will do this. As a group, as a company right now, we have 16, 18 drills turning at all times. It's a team of 100, just a geological team, and that's where the value creation is coming from. Of course, the plant, the mine, the cash flow, It's beautiful. It will fund all of this work over the next one or two years. But this is where the value is getting created. So at Gounder, we will follow up on the underground targets, especially the one we identified this week, showing the west extension at depth and the Gounder regional permits where we have many targets. At Boumadzine, for 2025, 50% of the drilling will focus on the main trend and TZ, which was a beautiful discovery in 2024. And we will continue to extend the known mineralization trend along strike at depth. And we will infill some areas as well to understand it better. 50% of their drilling will be on exploration targets, which come from the geological thesis that the team is putting together and where we will be testing the east-west structure where we see copper-silver, and we will also test some of the parallel systems to the current main track. To conclude the presentation and before the question period, what are the catalysts for 2025? How are we going to set ourselves apart? Well, of course, we will commence the drill program. You have a company that will drill between 140 and maybe up to 200,000 meters, depending on results and depending on what we're seeing. Commence the Bumazen PEA. That started in 2024, but it will accelerate in 2025. We still don't know how big the plant needs to be. And that is something that, you know, we're waiting for drill results and for the geological team to tell us, you know, what they believe is the optimal size of the deposit right now, the main zone. We're not going to take any of the other zone into account right now. Of course, one of the catalysts is steady state, 3,000 tons per day processing at Zgounder, ramping up to a steady state, ramping up to an availability of 92%, 95%, ramping up to a recovery between 88% and optimal 88% to 90%. That's what we aim for. Of course, the average of the year is not going to be this because Q1, Q2, Q3, you know, we're ramping up. We will do a mid-year update on boom adenine metallurgy and PDA. That's something that we've been working on now for many quarters, and it's something that, you know, we'll have much, much more information over the summer. And we will also publish a Zgunder mineral resource update as soon as the drilling is completed. And we know the size of that first loaf of bread. We're still looking for the second piece. But as soon as we've completed the first loaf, we will do a Zgunder mineral resource update with a new mining plan, a new cash flow, new production profile, just to show the strength of the deposit, the strength of the plant, and the quality of the production and the profitability and the cash flow going forward. Thank you very much for your time. The team is here to answer any questions you have. And I would close and say 2024 was a very strong year where we built it on time. We were a little late receiving the plant, but we commissioned it on time. And now we're starting a new era, which is 2025 on with added capacity, with Boumadine where it is, with MX2. to develop AMIS-MIS, and I really look forward to 2025. Thank you very much.