DPM Metals Inc.

Good day, and thank you for standing by. Welcome to the Dundee Precious Metals second quarter 2022 earnings results conference call. At this time, all participants are in a listen-only mode. At the speaker's presentation, there'll be a question and answer session. To ask a question during the session, you'll need to press star 11 on your telephone. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Jennifer Cameron, Director of Investor Relations. Please go ahead.

Thank you and good morning. I'm Jennifer Cameron, Director of Investor Relations, and I'd like to welcome you to Dundee Precious Metals second quarter conference call. Joining us today are David Ray, President and CEO and Hume Kyle, Chief Financial Officer. After the close of business yesterday, we released our second quarter results for 2022, and I hope you've had an opportunity to review our material. All forward-looking information provided during this call is subject to the forward-looking qualification, which is detailed in our news release and incorporated in full for the purposes of today's call. Certain financial measures referred to during this call are not measures recognized under IFRS and are referred to as non-GAAP measures or ratios. These measures have no standardized meaning under IFRS and may not be comparable to similar measures presented by other companies. The definitions established and calculations performed by DPM are based on management's reasonable judgment and are consistently applied. These measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS. Please refer to the non-GAAP financial measures section of our most recent MD&A for reconciliations of these non-GAAP measures. Please note that unless otherwise stated, operational and financial information communicated during this call are related to continuing operations and have generally been rounded. References to 2021 pertain to the comparable period in 2021 And references to averages are based on midpoints of our outlook or guidance. I'll now turn the call over to David Ray.

Good morning, and thank you all for joining us. I'm pleased to report that during the second quarter, we continue to deliver strong operating and cost performance at both of our lines, increase our financial strength, and advance our development projects and exploration activities. This morning, I'll briefly review our second quarter results and our operational performance before handing the call over to Hume to discuss our financial results. The highlights from our second quarter include a strong production of approximately 73,000 ounces of gold and 8.8 million pounds of copper. Excellent all-in sustaining cost performance of $792 per gold ounce, which was towards the low end of our full-year guidance. solid free cash flow generation of $41 million, and continued financial strength, exiting the quarter with a cash balance of $423 million. With strong gold and copper production and a year-to-date oil and sustaining cost of $741 per ounce of gold sold, which supports the cost at or below the low end of guidance range, we are well positioned to achieve our guidance targets for 2022. Turning now to the highlights from our operations, I'll start with Chalepetch. Chalepetch had an excellent quarter with production of approximately 49,200 ounces of gold and 8.8 million pounds of copper, benefiting from higher than expected grades relative to the mine plan, as well as recoveries above historical averages, which reflect process improvements we have implemented. For example, we continued to refine the implementation of an advanced process control solution, which has resulted in greater process efficiencies, reduced variability, and improved recoveries at our mines. And we're also implementing that at the moment. All in sustaining cost of the quarter was $838 per ounce of gold sold, which increased compared with the previous quarter, primarily due to higher treatment charges and rates. Chalipetch remains on track to achieve its 2022 production and cost guidance for the year. We continue to focus on extending Chalipetch's mine life through our successful in-mine exploration program and a growing brownfield exploration program, which for 2022 includes approximately 44,000 meters of in-mine drilling for mineral resource development, and that's typical of our spend and activity around in-mine exploration Further, we've got approximately 50,000 meters of brownfield exploration, which are primarily concentrated on near-mine exploration drilling related to the Sveta Petka commercial discovery application, as well as drilling at Charlotte Dairy and other near-mine targets in the mining concession area. We ramped up an extensive drilling campaign focused on Sveta Petka. as well as the Sholodiri and Petrovdan prospects within the mine concession, drilling over 20,000 metres during the second quarter. The drill campaign, which is planned to support an application for a commercial discovery at Speta Petka in 2023, is planned to continue for the balance of the year. With a mine life that extends to 2030, an updated mineral resource base, and increased in-mine and brownfield exploration drilling, we believe there is strong potential to continue our track record of mine life extension at Chalepetch. During the first quarter, Adatepe produced approximately 23,700 ounces of gold at an all-in sustaining cost of $714 per ounce of salt. For the mine plan, we are focused on completing pushback two in the first three quarters of the year, with grades expected to increase in the fourth quarter. With production in line with our expectations in the first half of the year, Adetepe is on track to achieve its 2022 guidance. We are continuing to assess the results of the accelerated grade control program at Adetepe. The drilling was completed in January 2022 and initial information for the 2022 mining areas was reflected in our production guidance for 2022. We are in the process of incorporating these results into an optimized mine plan, which is expected to be completed in the third quarter of 2022. We are continuing our exploration efforts around Adetete with 20,000 metres of drilling plan in 2022, which will be focused on near mine target delineation and drilling within the mine concession and surrounding Krimavitsa exploration licence. During the quarter, exploration activities were focused on an extensive target delineation campaign that encompassed the Adetete mine concession and regional licence. Work included detail mapping, rock sampling, trenching, and 3D modeling, which is now being followed up with diamond drilling. Turning to SPUMEP, Q2 performance reflects the planned Ostmult maintenance shutdown completed during the quarter, which was extended by 15 days to address cooling system, off-gas, and back-house system integrity, which is expected to improve operational performance post the shutdown. As Hume will discuss, we have revised guidance for Sumeth, reflecting its performance year-to-date and our expectations for the balance of the year. We continue to engage in a comprehensive initiative directive at optimizing the cost structure of the Sumeth smelter to enhance its ability to compete for additional third-party supply of complex concentrates and improve overall business profitability. In terms of our future growth, we continue to advance the Loma Laga project, recently of achieving a milestone with the receipt of a technical viability certificate for the salted tailings storage facility. This follows the technical approval of the EIA, which we received in April. As we previously reported, we paused our planned drilling activities near the end of February, pending the hearing of a constitutional protective action against the Ministry of Environment. Last week, we received a written decision by the Judicial Labor Unit of Cuenca, which upheld the validity of the environmental permits for exploration, confirmed that the Ministry did not violate certain rights relating to water and nature in granting DPM permits, and reaffirmed our legal rights to the mining concessions. The court also found that DPM will be required to include local indigenous populations in its consultation process prior to advancing to the exploitation phase. which we had already planned as part of our development of the project. BPM is committed to advancing the project in line with the highest standards for stakeholder engagement, which includes aligning our approach with international finance corporation practices which meet or exceed Ecuadorian standards. Our drilling activities remain paused at Loma Lago as we seek clarification from the court whether the indigenous consultation could be done in parallel with the citizens' participation process. the next step in the process to obtain the environmental license, or whether it must be completed before advancing those activities. This could potentially delay the timing of receipt of the environmental permit, which we expected to receive in the third quarter. In parallel with permitting, we have also continued our work to optimize the feasibility study for La Malaga and progress with several trade-off studies, aiming to further improve the project based on our As we advance the project, our team is proactively working with stakeholders to obtain the project's social license. We have increased our dialogue with local stakeholders to provide more visibility to certain aspects of the project that are of high interest in the local community, and we're maintaining a constructive dialogue with all government institutions involved in the development In Serbia, we continue to progress the feasibility study as a result of optimization activities focused on capital expenditures and mining activities. We now expect to complete the feasibility study in the third quarter. As we advance the work, we are seeing inflationary pressures on capital and operating budgets that are consistent with general industry trends. Following completion of the study, we plan to pursue additional exploration opportunities subject to receipts of required funds. To wrap up on the quarter, our strong production profile and significant free cash flow generation, combined with our operating track record and strong ESG performance, position us well to continue delivering value for all of our stakeholders. We are committed to deploying our capital in a disciplined manner, as we have demonstrated with our investments in optimizing our assets and advancing our organic pipelines. We also continue to pay a sustainable quarterly dividend and repurchase approximately 1.6 million shares in the first six months of the year. We are confident that DPM's strong fundamentals continue to represent a compelling value opportunity for investors, particularly at current share price levels. I'll now turn the call over to Hume for a review of our financial results and outlook, following which we will open the call to questions.