Endeavour Mining plc

Good day and thank you for standing by. Welcome to Endeavour Mining's Q2 and half year 2023 results webcast. Please note management's presentation today will be in video format here on our webcast platform. After management's presentation, there will be an audio only question and answer session. So for those who wish to ask a question, please dial into the phone line for questions. Please note that due to time constraints, we will be prioritising questions from covering analysts. Today's presentation is being recorded and a replay of the video and the transcript will be available on Endeavor's website tomorrow. I would now like to hand the call over to Endeavor's Deputy CFO and Head of Investor Relations, Martino De Ciccio.

Hello everyone and welcome to Endeavor's Q2 and half-year 2023 results webcast. Before we start, please note the usual disclaimer. Today's format will be similar to what we did for our end of year results. We have prepared a video which matches the slide order of the PDF results presentation which is available on our website homepage, so feel free to follow along. We hope that you find this more engaging and enjoy the video content. Sebastian will start with a recap of our key accomplishments for the first half year. Then Jaria will talk about our latest ESG initiatives. Guy will then outline the financial results before Mark provides a detailed operational review. And finally, Jono will update us on the exciting progress being made at our Tanda Iguala discovery, so make sure you stay tuned until the end. After Sebastian's closing remarks, we'll open the floor to questions. And now, I will hand it over to Sebastian.

Thank you, Martino, and hello everyone. For the first half of the year, we've continued to deliver again six key focus areas with the goal of unlocking near-term value for all of our stakeholders. I'll go through each area in detail, but as a quick summary, on the operational front, we are on track to meet our full year guidance for the 11th consecutive year. In line with our strategy of actively managing our portfolio to focus on higher quality assets, we were pleased to close the sale of our non-core Bungu and Wanyo mines during the period. The quality of our portfolio is set to further increase as our two gross projects, the Sabah de la Massawa Biox project in Senegal and the Lafigue project in Côte d'Ivoire, are progressing well. Both are on budget and on schedule to commence production in Q2 and Q3 24 respectively. Alongside this year's investment in our organic pipeline, we are pleased to continue to deliver attractive shareholder returns and have declared a H123 dividend for $100 million. On an annual basis, this represents $25 million more than the minimum dividend commitment for the year. Given that the Sabah de la Massawa expansion and the Lafayette Greenfield build are expected to both increase the group production and lower our cost base, they will further enhance our capability to reward our stakeholders. As such, our goal is to increase our shareholder returns program once our organic growth projects are completed, thereby ensuring that our efforts to unlock growth immediately benefit all our stakeholders. On the exploration front, in the first half of the year we have accelerated our exploration efforts at our Tenda Iguala discovery where we have drilled over 95,000 meters during the last six months. As such, we've decided to increase the full-year drill program at Tenda to 180,000 meters and remain on track to publish a resource update later this year. As part of our ESG strategy, we've launched several new initiatives which aim to protect the places where we operate and promote sustainable socio-economic growth in our host communities. We've also launched the construction of our Sabodala solar plant which has the dual benefit of reducing our emissions and decreasing our operational cost. I will now dive deeper into each of these themes, starting with our asset sales. The divestment was well aligned to our long-term strategy of progressively upgrading the quality of our portfolio. You will probably recognize my favorite magic box chart. As you can see, our non-core Bungu and Huanyu mines were clear outliers in the portfolio, with higher costs and shorter mine lives. they were also our two smallest mines. The divestment of these mines allows management to focus on the core mines while also increasing our geographic diversification. Prior to the sale, Burkina Faso represented 55% of this year's production, while it now represents 44% of production from our continuing operation. This is expected to decrease to around 30% next year following the completion of the La Figue build in Côte d'Ivoire and the Sabah de la Massawa expansion in Senegal. We were pleased to sell the assets to a trusted Burkina Bay focused business that shares our commitment to operate the mines in the best interest of employees and local stakeholders. We wish again to thank our Bungu and Wanyong employees for their commitment and professionalism and local stakeholders for their support which has contributed to Endeavour's success over the past several years. We wish them further success. Overall, we expect to add proceeds of more than $300 million from both assets, comprised of upfront and default payments, in addition to NSRs, which also allows us to retain further upside. These proceeds will allow us to complete our ongoing constructions with a healthy balance sheet, accelerating our ability to increase our shareholder returns program. Following the divestment of Bungou and Oignon, we have updated our production guidance to around 1.1 million ounces at an all-in sustaining cost of below $950 per ounce. So far this year, we produced 511,000 ounces at an all-in sustaining cost of below $980 per ounce, which places us on track to meet our guidance for the year. As we have previously guided, we expect performance to be weighted toward the second half of the year, as we expect stronger production at lower costs at our Hyundai, Sabah de la Massawa and Manor Mines. And as you can see on the screen, we are pleased that this operating performance continues to be achieved safely with a sector-leading safety record. Looking at the half-year production and the all-in sustaining cost trend, you can see that production decreased in line with the guided trend, while all-in sustaining costs remained below 1,000. Marc will run you through the mine-by-mine asset performance later, but at a high-level production decreased at Hyundai and Sabadora Masawa due to an increased focus on stripping activity, which resulted in lower-grade ore being processed. While at MANA, production decreased due to an increased focus on underground development, with supplemental ore being sourced from the lower grain Maula open pit. At a group level, this was partly offset by increased production at ET, which is on track to achieve another very strong year. In light of our efforts over the past six months, we are on track to achieve a stronger performance across our mines in the second half of the year. Turning to our operating cash flow, before working capital movements, you can see a modest decrease as the higher goal price only partially offset the expected lower production at higher cost. This cash flow profile is linked to our mine plan sequencing, which as mentioned earlier is expected to yield stronger cash flow in the upcoming quarters. As an aside, you can also see with the grey shaded area that the cash flow from the discontinued operation continued to fall each period, further demonstrating the rationale behind the divestment. While in the short term we expect to generate stronger cash flow through our flagship assets, by this time next year we expect to see a significant uptick in cash flow as both our gross projects will have been commissioned. To look at them in more detail, let me first elaborate on our Sabadola-Massawa expansion project. We are extremely excited about this project because of both its strategic and financial benefits. Once this expansion is completed, the Sabadola-Massawa mine will rank as a Tier 1 asset capable of producing more than 400,000 ounces per year, thereby increasing the quality of our portfolio and further diversifying our production base. In addition, based on the exploration success to find oxide ore, we are confident to be able to further boost production in the short term. I will let Marc provide details on the build within his section, but at a high level, construction work is progressing on budget, with 75% of the $290 million initial capital cost now committed. He is also tracking on schedule with first gold from the BIOX plant expected during the second quarter of next year. Moving now to our next growth project which is our La Figué greenfield development in Côte d'Ivoire. It will be another cornerstone asset for the company with an envisaged annual production of over 200,000 ounces over the initial 13-year mine life at a low all-in sustaining cost of below $900 per ounce. Construction activities have ramped up fairly quickly as you can see. We have now committed around 60% of initial capital with costs in line with expectations and we are on track for first production in Q3 next year. As you see in the production chart, these two projects will deliver growth next year with the full year benefits seen in 2025. We see production increasing to above 1.3 million answers in 2025 with strong potential for further increased production based on the continued outperformance at ET and Hyundai. We also anticipate bringing in more oxides at Sabadola-Massawa to lift production well beyond 400,000 oz. And in addition, we see Lafigue outperforming its nameplate capacity as most of our plants do. But equally important, this growth will allow us to maintain industry-leading all-in sustaining costs of below $950 per oz. Shifting now to our ongoing exploration efforts, which continue to generate excitement amongst the team, so far this year we spent over $50 million with a significant focus on our greenfield discovery Tenda Iguala. And owing to the ongoing success there, we have decided to increase this year's budget from $65 million to $80 million for our continuing operations. In the first half of the year, we drilled over 95,000 meters at Tenda, which is already more than the 70,000 meters originally planned. With the updated budget, we are now targeting to drill 180,000 meters this year. Tenda Iguala continues to show its potential to be a Tier 1 asset and we are excited to work towards publishing an updated resource estimate later this year. But our exploration success isn't limited just to Tenda. We've made significant progress across our producing assets. At Hyundai, for example, we've identified extensions at the carry pump and carry waste deposits. Also at Hyundai, we have potentially made a game-changing discovery as we confirmed high-grade mineralization below the Vindaloo deposit, which shows the potential to delineate a sizeable high-grade underground resource. We will be following up on this in the upcoming drill programs. At Sabadola-Massawa, we are expanding resources at Kiesta, Nyakifiri and Kerekunda, which could provide non-refractory ore and help leaf production. At E.T., we are looking to expand resources at the Flotuo, Walter-Bacatuo and Iopleu-Légaleu deposits, and we are testing also new targets. While at MANA, we've been busy testing ore chutes at Oona Underground and expanding resources at the Maula and Niafe open pits. This success across the group leaves us well positioned to meet our five-year discovery target, which has been updated to reflect the divestment of the non-core Bungu and Wanyu mines from 15 to 20 million ounces of indicated resources to 12 to 17 million ounces of indicated resources over the 2021 to 2025 period, at the low discovery cost of less than $25 per ounce. While we continue to grow our business organically through our development projects and exploration, another important capital allocation priority for us is to continue to return capital to our shareholders. For H1, we have announced a dividend of $100 million, which on an annualized basis would represent $25 million more than our minimum dividend for this year. These REIT rates are commitment to paying supplemental shareholder returns despite our other capital allocation priorities this year, including significant growth and exploration. In addition to our dividend, we have returned over $20 million in share buybacks year-to-date, which means that since the launch of the program in early 2021, we've bought back more than $250 million worth of shares, representing over 11 million shares, which is equivalent to approximately 5% of our current shares outstanding. To put this into context, it means that approximately $200 per ounce produced in H1 was returned to shareholders. Or to put it in another way, 10% of our revenue was distributed to shareholders, corresponding to over 30% of our operating cash flow. It also means that we returned an attractive indicative yield of over 4% for the half year, coupled with, of course, strong value creation by unlocking our growth potential. Overall, this means that our progressive shareholder returns program has now returned over $750 million in the form of dividends and share buyback since we declared our first dividend in 2020 and commenced payment in early 2021. To put this in context, we've returned approximately 13% of our market cap since the beginning of our returns program. Another way to look at it is that we delivered significantly more than the capital required to build a new mine. Looking ahead, Once we finish our current two builds by mid-next year, we then expect to refocus on further strengthening our balance sheet and increasing our shareholder returns before potentially launching a new build, thereby ensuring that our efforts to unlock growth provide immediate benefits to all our stakeholders. Before I hand over to the team, I just wanted to reflect on our LSA listing following its two-year anniversary. We are very pleased with our listing given that over 50% of our trading volume is now occurring on the UK line. This is a great outcome given that we didn't issue equity into the UK along with our listing. As you can see on the chart, getting included into the FTSE 100 NMSCI UK indices has clearly helped drive appetite for our stock. The volume increase is also reflective of the change in our shareholder base, which has seen UK and European shareholders climb up the register. Now I will hand over to Jahia to share some ESG initiatives with you.