Endeavour Mining plc

Good day and thank you for standing by. Welcome to Endeavour's Minings fourth quarter and full year 2023 results webcast. At this time, all participants are in listen-only mode. After management's presentation, there will be a 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 conference call is being recorded and a transcript of the conference will be made available on Endeavor's website tomorrow. I would now like to turn the conference over to Endeavor's Vice President, Investor Relations, Jack Garman.

Hello everyone and welcome to Endeavor's Q4 and full year 2023 results webcast. Before we start, please note our usual disclaimer. On the call today, I'm joined by Ian, Guy, Mark, Giaudia, and Jono. Today's call will follow our usual format. Ian will first go through our full year results highlights. Giaudia will provide an ESG update. Guy will present the financials. Mark will walk you through our operating results by mine. Jono will provide an exploration update. After Ian's closing remarks, we'll open up the line for questions. I'll now hand over to Ian.

Thanks, Jack. Hello to everyone, and thank you for joining us today on the call. Now, I'm delighted to have joined Endeavor at such a pivotal time for this company. I joined the board initially in 2013 until 2019, and then I rejoined again in 2022, holding several positions on the board. So I do have a great familiarity with the company as well as its assets and many of its people. Now, the team and I are focused on delivering value for all of our shareholders through our strong operational performance, executing our high-margin growth project construction, and maximizing our prospective exploration portfolio, all in a safe and responsible manner so that we can reward all of our shareholders, all of our stakeholders on a sustainable basis. Now, we're currently moving to a new phase in the company's development, from one focused on investing in organic growth to one of enhanced cash flow generation, debt reduction, as well as shareholder return. However, before I highlight our key priorities for 2024, I just wanted to talk a little bit about our achievements in 2023. I'm proud to say that 2023 was another very successful year for Endeavour, in which we delivered on all of our key priorities. On the operational front, we produced almost 1.1 million ounces of gold, meeting our production guidance for the 11th consecutive year. Our all-in sustaining cost continued to be at a level that places us amongst the lowest cost producers in the entire gold mining industry. Although slightly higher than guidance, as we had incurred slightly higher royalty costs following a higher gold price environment. During the year, we were focused on growth, as I said earlier. We accelerated our two high-margin growth projects, the Sabadala Masala expansion, as well as the Lafigue development project. In total, we spent $448 million on growth capital during the year. I'm pleased to report that both these projects are on budget and on schedule for first gold in quarter two, with La Figue expected to deliver first gold a quarter earlier than we had previously guided. Now, our strong exploration results continue to demonstrate our ability to generate an organic growth pipeline. This year, we put great emphasis and prioritization on our recent Tanda Iguala discovery in Cote d'Ivoire. We reallocated resources from across our exploration portfolio to focus on tanda because of what we realized was great potential. As a result, we were able to deliver a 303% increase in indicated resource, and the project now stands at an impressive 4.5 million ounces of indicated resource and certainly ranks as one of the most significant discoveries in West Africa in the past decade. Moreover, We're confident there is more to come from Tanda Iguala, as you'll see later on when we discuss. And we'll continue to explore this area further throughout the year. Alongside this year's investments in our organic growth, we're pleased to continue to pay attractive shareholder returns as we deliver $266 million in the form of dividends and share buybacks to our shareholders. And that's equivalent to $227 for every ounce of gold that we've produced. Looking ahead, our goal is to further increase shareholder returns once our two organic growth projects are complete to ensure that our efforts to unlock growth can deliver immediate benefit to all of our stakeholders. And we expect to provide an update on the next phase of the shareholder return program in early portion of H2 this year. Despite investing over $800 million in growth, exploration, and shareholder returns during the year, our leverage remains healthy at about 0.5 times net debt to adjusted EBITDA. As we finalize our two growth projects in the coming months, we expect that leverage to incrementally increase. But once these projects come online, we will then focus on deleveraging the balance sheet as well as increasing our commitment to shelter returns. As part of our ESG strategy, we continue to focus on initiatives that protect the places where we operate and promote sustainable socioeconomic growth in our host communities to support the long-term success of the business. Today, we published our seventh annual sustainability report, highlighting the significant milestones we've achieved over the past 12 months. As you can see, 2023 was a very successful year for us, and we're really well positioned to continue this momentum that we have built into 2024. Now, let me just take a moment to discuss the termination of the former CEO that occurred in January this year. The decision to remove Sebastian from the role was taken by the board after an investigation uncovered an irregular payment instruction of $5.9 million to a third-party bank account in the United Arab Emirates, which was related to the disposal of the Agbaal mine in 2021. The board then expanded its investigation to try and identify the beneficiaries of the $5.9 million, which was unsuccessful, but did uncover two further payments that totaled $15 million that were made in August and November 2020 to the same third-party company as the $5.9 million payment. These two payments were deliberately disguised as advance payments to a contractor through repeated false representations to management. Now, there's strong evidence that the former CEO abused his position actively misled the board and senior executive team through repeated and deliberate false representations and concealment of information over a sustained period. His termination was the most important step in protecting the company from any further conduct of this nature. We've taken very deliberate steps under the leadership of our CFO and our audit committee to improve and enhance our internal controls and processes to prevent this behavior from happening again. And whilst we're disappointed to have uncovered some additional payments, it should be noted that we are satisfied with the integrity of our financial reports. And as such, our auditors have declared that no restatement of prior year accounts will be required or forthcoming. We're pleased the board has now completed this very comprehensive investigation, and this enables us to put this matter behind us and focus on delivery. It's important to reiterate that the strong foundations that underpin Endeavor are its high-quality assets, its great people, and it's because of that that I am thrilled to now be working with this team. And together, I have absolutely no doubt that we can continue to generate value for all of our stakeholders. If we take a closer look at our operating performance last year, as I said earlier, we produced 1.1 million ounces marking our 11th straight year of achieving guidance. We did that and in the process we achieved an industry-leading all-in sustaining cost of $967 per ounce for the full year. That was slightly above the top end of our guidance range, but that really was driven mostly by higher royalty costs that we had to pay of $18 an ounce. This was higher than originally anticipated due to the higher realized gold price and the higher royalty rates kicked in above the $17.50 that we had used in our guidance. On the safety front, despite our industry-leading LTIFR, I'm certain to say that in February of this year, a contractor colleague passed away as a result of injuries sustained in a maintenance incident at the Marla Mine in Burkina Faso. And naturally, we extend our sincere sympathies and support to his family, his colleagues, and his friends. The health, safety, and welfare of all of our colleagues is a top priority. and we'll do everything that we can to ensure this doesn't happen again. Later, Mark will talk you through some of the work we're doing to help us achieve our zero-harm goals. As you can see on slide 8, production from continuing operations decreased during 2023 compared to the prior year, as production decreased at Mana and Sabadala Masala mines. and that was partially offset by record production at Hyundai and Iti Mines. Both achieved over 300,000 ounces of production for the year. Meanwhile, all-in sustaining cost, as I said earlier, increased to 967, but we did maintain our status as one of the cost leaders in the sector. On slide 9, you can see in the chart here, the all-in sustaining cost of 967 positions us not only in the first cost quartile of the sector, but as one of the lowest cost producers in the industry and one of only a few large gold producers that have been able to maintain an all-in sustaining cost below the magic $1,000 mark. Hopefully, we're not going to stop there. Following the startup of our two new growth projects, we certainly hope that we'll be able to maintain that strong cost performance as we bring online lower cost production. We don't want to produce ounces for the sake of producing ounces, but rather we want to continue to focus on delivering high margin ounces because that's what generates decent returns for our stakeholders. On slide 10, you can see that our high margin ounces supports our robust EBITDA generation. And on this slide, you can see we generated over a billion dollars of adjusted EBITDA during the year. And again, that's due to our high-quality portfolio, which has been supported by our low operating costs as well as the naturally higher gold price. Over the last two years, we've been focused on delivering the two growth projects. Sabadala-Masawa expansion and the Lefige development project. As we're approaching completion of both projects, I'd like to take a moment just to provide a bit of a short update on each project. At Sabadala, 90% of the $290 million initial capex is now committed and the project remains on budget and on schedule for first gold sometime in early May. Since late February, Wet commissioning has been underway, and last week we started feeding ore through the crushing, milling, and flotation circuits. We've already started feeding our own Masawa concentrate through the biox circuits, and I'm pleased to report this has been very successful with the biox inoculum taking to the Masawa concentrate very well. And as I say, the bugs are bugging, so we're really pleased with what they're doing there. As a reminder, we expect to produce over 100,000 ounces of gold from this plant during the year. And once fully ramped up, there's no doubt that Sabadala Masawa will rank as a Tier 1 asset, so thereby increasing the overall quality of our portfolio and further diversifying the geography of our production base. Turning now to Lafigue on slide 12. We've now committed 92% of the initial capital of $448 million, and not only we're on budget, but we're also nicely ahead of schedule with our targeted first gold pour now expected in Q2, not as we said earlier, a full quarter ahead of the original schedule. Now remember, We launched construction at Le Figuer in October 2022, and we're now expected to deliver gold in less than 21 months since the start of construction. I think that's a pretty impressive achievement, given we're building a brand new cornerstone asset from scratch in under two years. It's also another example of the competitive advantage that we have with our projects team and our understanding of how to operate here in West Africa. where we can build and commission projects far more quickly and for lower capex than many other people in the region. The FIGE is expected to deliver around 100,000 ounces this year, and that will increase to about 200,000 ounces when we get a full year's production over next year. Once fully ramped up, obviously costs will improve to become in line with life of mine expectations. I'll leave Mark to provide a detailed update on how both those projects are progressing. Turning to slide 13, our exploration success continues to be a fundamental contributor to our organic growth and is really very much a fundamental part of the DNA of Endeavour Mining. This year, as I said, we prioritized our Tanda Iguala discovery in the Cote d'Ivoire delivering record annual resource discoveries of 3.6 million ounces at a cost of less than $25 per ounce. This brings the total measured and indicated discovered since we launched our first exploration plan to 18.6 million ounces. Over this period, we've produced 7.6 million ounces, so that's reinforcing the value that our exploration program generates in terms of additional resource base that we can exploit. On slide 14, during 2023, we quickly identified the Tandy Gwela Exploration Program as a high priority as we saw the potential to significantly increase the resource base at the Asafo deposit on the Tandy Gwela property. The increased resources that will definitely underpin the preliminary feasibility study, which is now underway, and it's our plan to have this out by the end of 2024. In order to expedite the exploration program, we allocated additional resources to bringing tender iguela to a head during the year. At one time, we had up to 10 drill rigs operating there, and that enabled us to deliver you know, this over 300% increase in resource. This year, we're going to focus on resource to reserve conversion across the group, particularly at our core assets, as well as Tanda Iguala, where we expect to be able to convert a high portion of the current indicated resource to reserve throughout the year. Thanks to the discovery at Tanda Iguala and our core assets, we've been able to deliver over 10 million ounces of measured and indicated resource discovery since 2021 when we launched our five-year exploration program. And we're now really well positioned to achieve our 12 to 17 million ounce indicated resource discovery target by the end of 2025. with a $65 million spend outlined for 2024, as well as a focus on the cornerstone assets Sabadala, Iti and Hyundai, as well as continued focus on looking at the potential around Tanda Iguala. Now, we're going to prioritize Sabadala and Iti, where approximately 50% of the full-year spend will be allocated. Elsewhere, we're going to continue to explore in close proximity to Lafigue processing plant where we've seen some encouraging drill results and we'll advance early stage greenfield opportunities across the region. We're also going to continue to advance the high priority tender Iguala project where we're going to be expanding resources but converting that to reserves as in parallel to us progressing the preliminary feasibility study. Now, Tanda Igweala is an excellent example of the opportunities that lie in West Africa and our ability to historically unlock these projects. In just over two years, we've delineated a potential Tier 1 deposit with a four and a half million ounce resource at two grams a ton that was discovered for a complete discovery cost of $11 per ounce. And Tandegoela is one of the most significant low-cost discoveries made in West Africa in the last decade. It's got significant upside potential remaining along its 20-plus kilometer corridor, as well as potential satellite targets in adjacent structures within close proximity of any processing facility that we will put up. on site. I'm going to let Jono provide you with some more detail later on when he steps up to the microphone to talk. Moving to slide 16, we will be completing our two organic growth projects in the coming months. I just wanted to touch on our capital allocation priorities. As we transition from the phase of investing in organic growth and move to one of more increased cash generation. As I mentioned earlier, we consistently invest in our exploration, as I believe that exploration underpins our long-term growth. And as we've demonstrated on more than one occasion, our exploration program can deliver high-quality projects into our pipelines at low discovery costs. But exploration is not something you can just start and stop and still be successful at. So we're going to continue to invest in exploration, particularly when we know that we have the ability to discover ounces at less than $25 per ounce. We've taken a phased approach to growth over the recent years, and it's not the end of our growth. Obviously, Tenda Iguala will be coming forward in due course as well. When we completed our last growth phase, having invested around $788 million in the Hyundai and Nitti builds, we were able to fully deliver our balance sheet in less than 18 months, and at which point we launched our shareholder returns program. We've continued returning capital to shareholders throughout our current construction phase. And the importance of maintaining a high-quality portfolio and a disciplined approach to capital allocation is reflected in our ability to deliver sector-leading shoulder returns while simultaneously investing well over $700 million in the two current growth projects. We're now exiting this current phase of growth at the end of H1 2024, and we're going to enter into a cash flow generative phase where we'll focus on strengthening our balance sheet, deleveraging it, and increasing our shareholder returns, which will reflect the stronger cash flow outlook over the next few years. And we certainly look forward to outlining our updated shareholder policy return policy later on this year. Touching on shareholder returns for the fiscal year 23 on slide 17, we're certainly proud that we've returned $266 million to our shoulders this year. That was $200 million in dividends and $66 million in share buybacks. That's equivalent to a very attractive indicative yield of around about 6%, or as we said earlier, $227 per ounce for every ounce that we've produced throughout the year. Now, 2023 marks the last year of our existing shoulder return policy. is slide 18 showing the cumulative returns to shareholders since the start of that policy. And this slide really is a testament to the strength of the underlying business and the commitment Endeavor has to reward its shareholders by paying above the minimum shareholder return commitment. Over this three-year period, we returned $903 million to shareholders. That was 77% above the $510 million minimum commitment and represented over $200 return to Shell for every ounce of gold that we've produced over that period. To put that in perspective, $903 million is equal to roughly a quarter of the market cap of the business. Of course, Shell is only one of our stakeholders. Alongside our full year results, we also published our sustainability report today. So I want you to hand over to Jaria, EVP of ESG and supply chain, who can talk you through to some of our achievements this year. Jaria, over to you.

Thank you, Ian. I would like to start with our industry leading ESG initiatives. as we believe that mining has the potential to be one of the most impactful industries, particularly in West Africa, where we operate. Our strong ESG performance in 2023 saw us achieve nearly all our ambitious targets. But on today's call, I will only focus on a few highlights, as we will be engaging with you on an individual basis to go through our ESG performance in more detail over the coming weeks and months. On the environment side, we were pleased to beat our mission target for the year. This put us well on the way to achieving our 30% reduction target by 2030. And with the anticipated commissioning of the solar power plant at Sabadola-Masawa by year end, we expect to continue that momentum. Mark will discuss this in more detail in his section. On the social side, we continue to be a significant contributor to our host countries, with $1.4 billion spent on our in-country suppliers, which represents about 81% of total spend. But what I'm particularly proud of is our 22% women new hires which exceeded our 15% target. This has boosted the group's overall female representation by 20% to 11% in just one year. Given the countries and the industry within which we operate, this is a truly phenomenal achievement. Turning to governance, we are particularly proud to have achieved compliance with the responsible gold mining principles across all our sites during the year, reaffirming our status as a responsible producer. It's also encouraging to note that our positive impact continues to be recognized by the rating agencies, as both Sustainalytics and MSCI have reiterated our sector-leading rating this year, firmly embedding endeavor as an ESG leader, not just within the sector, but also across other sectors as well. Our 2023 sustainability report was published today, and it provides further details on our 2023 performance, as well as our target for this year. You can find it on our website, along with our ESG data center, and I encourage you to read it as it provides further insight into our impact and positive contributions to our host communities and our host countries. I will now hand over to Guy to talk through the financial highlights. Guy?

Thanks, Jaria. I'll now walk through the Q4 financial highlights. Q4 production was stable in line with Q3. while our all-in sustaining costs and the realized gold price both improved by 2%, driving an 11% higher adjusted EBITDA. Similarly, our operating cash flow before working capital increased by 103%, supported by lower income taxes paid in Q4 due to the timing of income and withholding tax payments. Operating cash flow increased by 45% quarter-on-quarter, and was impacted by a working capital outflow largely due to an outflow of trade and other receivables, as well as some stockpile build. If we look at slide 22 and the quarter-on-quarter variations in a little bit more detail, Q4 production was stable compared to the previous quarter of 280,000 ounces. A stronger production at Sabadala-Masawa, Iti, and Mana offset the expected decrease in Q4 production at Hyundai. Importantly, our all-in sustaining cost decreased by $20 per ounce in the fourth quarter, despite the increase in sliding scale royalty rates in Burkina Faso that were effective as of November 2023. And the group benefited from cost decreases at Sabadala Masawa and Manor due to higher production and gold sales. Turning to slide 23 and our all-in sustaining margin, our quarter-on-quarter cost improvements, coupled with the improving gold price, resulted in an improvement in Q4. Importantly, our all-in sustaining margin has remained relatively stable over the past year at a very healthy 50%. Moving to slide 24, you can see that during Q4, we continued to generate strong adjusted EBITDA and maintained a healthy EBITDA margin. Contributing factors that led to the improved Q4 result include increased quarterly production, improved all-in sustaining costs, and the higher realized goal price. On slide 25, in Q4, our operating cash flow before working capital increased by over 100%, as I said, to $246 million, as the prior quarter was impacted by higher withholding tax payments, while the fourth quarter delivered robust production at the lower all-in sustaining costs for the year. On slide 26, we have a bridge showing that our operating cash flow increased by 45% over the third quarter to $167 million. Higher gold prices, higher gold sales, and lower operating expenses were significant drivers, but the biggest impact was the materially lower withholding taxes paid during Q4 compared to Q3, which were associated with cash upstreaming as well as the lower income taxes paid in Q4. You will note that working capital is a significant outflow this quarter. This is mainly driven by an outflow in trade and other receivables, relating predominantly to the timing of VAT receipts, and an outflow of inventories, relating to the increased stockpiles at Sabadola Masawa and ETI. You will see on slide 27, as a result of all of this, our net debt increased during the quarter by $110 million to $555 million. as we spent $155 million on growth capital and $23 million on exploration, as well as completing $26 million in share buybacks. We're in the enviable position of having sufficient cash flow generation to fund our organic growth while delivering shareholder returns and preserving a robust balance sheet position. Looking forward as we advance our growth projects towards completion in the coming months, I expect our net debt and our leverage to increase And once the growth projects are up and running, we'll be able to quickly delever the balance sheet whilst maintaining our returns to shareholders. Looking at a more detailed breakdown of our quarter-on-quarter change in net debt on slide 28, our operating activities generated $167 million, while we invested $211 million in our existing operations and our growth projects during the period. Our financing cash flow was an outflow of $79 million, as we paid $37 million in interest for our debt facilities and continued to buy back our shares as part of the overall share buyback program. We also saw a $15 million gain incurred as the value of our cash on hand was positively impacted by the relative appreciation of the euro against the U.S. dollar. Overall, this resulted in our net debt increasing to $555 million at the year end. Moving lastly to our net earnings from continuing operations on slide 30, our net earnings were lower quarter on quarter due to the impact of several predominantly non-cash items, including impairments, higher other expenses, higher losses on financial instruments, and higher tax expenses, while our adjusted net earnings were slightly lower quarter on quarter due to slightly higher tax expenses and high realized losses on financial instruments. Rather than talk through every line item, I'll just focus on a few of the key numbers as we've marked on the slide. For the quarter, we booked an impairment of mining interest and goodwill of $108 million, consisting of $51 million against exploration properties where we see no near-term programs planned, and $57 million recognized against the Kalana project, in relation to the envisaged changes to the capital expenditure assumptions within the ongoing technical study. Within other expenses, we recognized $45 million, which included a $23 million ECL, or estimated credit loss charge, against the deferred cash considerations for the Bungu and Wanyan asset sales, as we have now launched legal action to recover these proceeds, and a tax settlement of some $23 million. The loss in financial instruments decreased from a gain of $7 million in Q3-23 to a loss of $84 million in Q4-23, largely due to increases in unrealized losses on gold hedges as the gold price increased quarter on quarter, and a change in the fair value of NSRs from the divested Bunga and Wanyan assets, where we updated our assumptions to a more conservative reserve-only assumption based on performance from those assets after we divested them. Adjustments included the previously mentioned non-cash impairment charge of $108 million, the net loss on financial instruments of $67 million, other expenses of $45 million, and a net loss from discontinued operations of $2 million, partially offset by a gain on non-cash tax and other adjustments of $15 million that mainly relate to the impact of foreign exchange remeasurements of deferred tax balances. I would now like to hand over to Mark, who will take you through our operating performance.

Thank you, Guy, and hello to everyone. Before I jump into our mind-by-mind detail, I want to talk briefly about our safety performance. We have maintained an industry-leading lost time injury frequency rate from continuing operations of 0.05 per million hours worked. But even with our strong safety culture, we are always conscious that just one incident is one too many. As Ian mentioned earlier, We were saddened to report that a contractor colleague passed away in February as a result of injuries sustained in an incident that occurred during maintenance activities at the Manor Mine in Burkina Faso. We have investigated the incident thoroughly and while procedures were unfortunately not followed, we will continue to reiterate the importance of training, frontline supervision, on-the-job assessments and strengthening our operational procedures as appropriate. Elsewhere in the portfolio, I'm really proud of the entire team involved in the construction of the Sabadala Masawa BIOS project. With the project nearing completion, they have achieved a truly remarkable three million hours worked without a lost time injury. This is particularly impressive given the close proximity and overlap between the project and operations team who have been supporting the project throughout. I will now talk through our group performance and then each mine in more detail. In 2023, we were pleased to have met our production guidance for the 11th consecutive year, with almost 1.1 million ounces of gold produced, while remaining one of the lowest all in sustaining cost producers in the sector. During the year, we achieved record production at both the Iti and Hyundai mines, where production exceeded 300,000 ounces thanks to higher-than-expected throughput and grades respectively, highlighting the potential at both of these mines. At the Manor mine, we missed full-year production guidance, as we previously indicated in quarter three last year, due to the slower-than-expected ramp-up of the second underground contractor, while at Sabadala Masawa, we slightly missed production guidance, as we mined lower-than-anticipated tonnage of high-grade ore from the Sabadala pit. Our group performance reiterates the value in having a diverse portfolio of high quality mines to ensure that we can consistently deliver on our objectives. Our all in sustaining costs from continuing operations amounted to an industry leading $967 per ounce for 2023. This is near the top end of the guided $895 to $950 range when allowing for the impact of higher royalties. This was due to the realised gold price averaging $1,939 per ounce for the year, well above the $1,750 per ounce used for our start of year guidance, further compounded by the change in the sliding scale royalty rates in Burkina Faso, which came into effect in November last year. Going side by side, Sabadala Masawa achieved an all-in sustaining cost near the bottom end of the range due to lower than planned sustaining capital expenditure At Hyundai, the all-in sustaining cost was higher due to the increase in royalty rates mentioned earlier. The all-in sustaining cost for Iti was below the bottom end of the guided range due to higher production and sales and lower costs. Lastly, at Manor, the all-in sustaining cost was higher than anticipated due to the slower than expected ramp-up of the new underground mining contractor, leading to lower gold sales. I am pleased with the group's ability to manage costs in what continues to be a challenging cost environment among all of our peers. Our full year 2023 oil and sustaining costs increased by $118 per ounce over the prior year. Two drivers of the increased oil and sustaining costs were the lower volumes of gold sold year on year and the increased operating costs, particularly around fuel and other consumables. These increases were partly offset by increased pre-stripping activities across Sabadala, Massawa and Hyundai, which resulted in capitalisation of associated waste mining costs. Notably, 20% of the increase in oil and sustaining costs was driven by external factors, including increased royalties following a higher gold price environment, which had a $15 per ounce impact, and unfavourable foreign exchange movement, which had a $9 per ounce impact. Before I go through the individual mines, I will walk through the year-on-year evolution of our reserves and resources. Overall, our proven and probable reserves declined by 1.3 million ounces, mainly due to mining depletion, as well as some impacts from updated resource models and cost assumptions. At Sabadala Masawa, these were more specifically at the Nyaka Ferry East Pit, following an extensive drilling campaign, and the Massawa North and Central Zone pits, where slightly higher cost assumptions were incorporated. At Iti, the Le Plaque and Dupleux pits saw some changes from model updates and slightly higher cost assumptions. At Manor, the Wainer Underground Reserve increased year on year. Measured and indicated resources increased by 1.4 million ounces, despite resource depletion, with some additions on our operating mines, though mainly due to the resource increase at Tanda Aguila, which was our exploration team's highest priority in 2023. With more than 10 years of production visibility across our key assets, we prioritised the exploration of our recent Tanda Aguila discovery, adding 3.4 million ounces of indicated resources which is an increase of 303%. This year, we will focus on reserve definition at our operating assets while exploring several exciting opportunities for further resource additions as well, which Jono will touch on later. At our flagship Sabadala-Masala mine, production increased significantly in quarter four due to the high-grade ore sourced across the Sabadala-Masala central zone and Sophia North extension pit, and increased throughput due to a higher proportion of soft ores mined from the Nyaka Ferry East Pit. Oil and sustaining costs also improved significantly during the quarter, largely due to the increased production and gold sales. For the full year, production decreased compared to 2022 due to lower average grades mined, as mining in 2022 benefited from the completion of the high-grade Sophia Main Pit and higher-grade oxides in the Masawa pits compared to 2023. Mining in 2023 focused on the Sabadala pit to complete this ahead of eventual in-pit tailings deposition and in opening up the Niagara Ferry East pit. All-in sustaining costs increased due to lower gold sales volumes and slightly higher mining unit rates. Looking ahead to 2024, production is expected to increase significantly due to the start-up of the BIOPS sulphide oil processing plant, with first gold expected in early May. Oil and sustaining costs are expected to be between $750 and $850 per ounce, slightly higher than 2023 due to the ramp-up of the BIOPS plant. Then from 2025, once the new plant is running at capacity for the full year, costs are expected to improve significantly. On the next slide, I'll provide an update on progress at the Sabadala Masala Bios expansion, which is now in its final stages of commissioning. Construction of the project was launched in April 2022 and remains on budget and schedule for start-up in early May. This will be just two years from the launch of construction to first gold, and importantly, we've achieved this while delivering over 3 million hours worked without a lost time injury. reiterating the quality and dedication of our project teams. Following the start of wet commissioning in February, we are now feeding all through the crushing, milling, and flotation circuits. And last week, we started feeding our flotation concentrate into the biop circuit, which is responding very well. From here, we will progressively fill the six biops reactors in sequence as we introduce more Masala concentrate. Project construction is almost complete and I am truly impressed with the dedication from the entire team to bring this project online, on budget and on time. Approximately $260 million or 90% of the total growth capital has now been committed with pricing in line with expectations. Growth capital expenditure guidance for 2024 is expected to amount to $72 million related to the final construction and commissioning activities. Moving on to the Hyundai mine, 2023 was a record year at Hyundai where the mine produced 312,000 ounces exceeding the top end of the guidance range due to the higher than expected grades mined at the carry pump deposit. All in sustaining costs were slightly above the guidance range due to the change in sliding scale royalty rates in Burkina Faso that became effective in November, and the increased costs associated with mining the additional ore that was outside of the initial plan for the year, resulting in an increase of $114 per ounce. For the full year 2024, Hyundai is expected to produce less than the record level set in 2023, as stripping activity will focus on the higher grade carry pump and Vindaloo main pits in the first half of the year, while all mining continues at the lower-grade Carey West pit. In the second half of the year, all will be mined in increased amounts from Carey Pump and Vindaloo main, which is expected to result in a strong half-two performance. Now turning our attention to the Itty mine, where we once again achieved record production in 2023, beating both our production and cost guidance for the year. The outperformance was driven by higher than expected throughput and recovery rates, as a high proportion of oxide ore from the Laplac pit was mined and processed, with supplemental oxide ore continuing to be fed using the surge bin feeder. All in-sustaining costs were below the guided range due to the higher than expected production and gold sales, as well as lower mining and processing costs that benefited from the higher than expected volumes mined and processed. Construction is underway on the mineral sizer primary crusher optimization, which will allow us to continue feeding oxide ore at a higher rate, particularly during the wet season, when we would historically have to blend oxide ore with more transitional and fresh ore to prevent blockages in the crushing circuit. Construction is expected to finish in half two this year, which will support higher levels of throughput in subsequent wet season periods. The TSF-1 wall raise has been completed and the construction of the second TSF is well underway. This will be completed in the coming months, well before the end of deposition on TSF 1. The re-sign plant is ramping up and we are engineering out some volumetric constraints in some sections of the plant. We expect re-sign plant performance to improve as the year progresses. This year, it is expected to produce between 270 and 300,000 ounces at an all-in sustaining cost of between $850 and $925 per ounce, with production slightly weighted towards the first half of the year due to greater availability of high-grade ore from the Iti and Bakatu pits in the mine plan and the wet season impact on mining and milling rates in the second half of 2024. Moving to our manor mine. Throughout 2023, we were transitioning MANA from a combined open pit and underground operation to an underground only operation and to maintain throughput and production levels as we focused on expanding the Wona underground mine. During the year, we advanced two additional declines into Wona successfully, and we currently have three declines in development and two in stroke production. As we highlighted in quarter three last year, MANA missed its production and cost guidance for the year as the new underground contractor at MANA took longer than expected during the ramp-up phase, resulting in slower underground development and higher unit costs related to the lower production levels. Since quarter three, we have started to see improved performance, which has given us access to multiple production stoves and improved the overall stope grade. As a result, MANA is expected to increase production in 2024 to between 150 and 170,000 ounces at an all-in sustaining cost of between $1,200 and $1,300 per ounce. All-in sustaining costs are expected to be elevated in 2024 due to the higher cost mining in the final phases of the Mayola open pit and the transition from capital development to production in the underground, which will result in higher expense costs and sustaining capital costs. Though beyond 2024, we expect underground costs to improve as we stabilise the development profile. At La Figue, we are building a 4 million tonne per annum CIL plant that will add more than 200,000 ounces of new production at all in sustaining costs below $950 per ounce over 10 years, continuing to improve the quality of our portfolio and drive production growth to above 1.3 million ounces by next year. This year, we expect to produce 90,000 to 100,000 ounces at an all-in sustaining cost of $900 to $975 per ounce. And next year, with a full year of production, we expect all-in sustaining costs to decrease in line with the DFS production plan. Approximately $411 million, or 92% of the total growth capital, has now been committed, with pricing in line with the expectations. while $321 million of growth capital has been incurred since the commencement of the project. In terms of the build itself, construction activities are well advanced with the crushing area, ball mill, HPGR installation, COL tanks, the elution area all nearing completion. All sea freight shipments are now in country and key items on site. HDPE lining of the tailing storage facility is also complete. The 225 kilovolt power substation is complete with the Davakala switch yard and overhead power line successfully energised during December 2023. Mining equipment mobilisation is well advanced and mining activities commenced during quarter four 2023 with approximately 2.9 million tonnes of material moved last year and 8.25 million tonnes of material moved project to date. The Figo was an exploration discovery that we made in 2016 and less than eight years later we will be producing our first gold. This is a significant achievement and it reiterates the strength of our organic growth pipeline and the fact that we are able to grow production organically. It also reinforces that West Africa is an exceptional operating environment as we can discover high quality ounces because of the prospectivity of the Burimian Greenstone Belt and relatively underexplored nature of the countries where we operate. Furthermore, we can achieve all permit requirements and build mines quickly at an industry-leading capital intensity thanks to the supportive local communities, the established clear and timely permitting processes, availability of high-quality engineering firms with experience in the region, and access to good quality skilled labour. I will now hand over to Jono to provide an update on our exploration program at Tanda Aguila.

Thank you, Mark. Referring to slide 41, our focus last year was on delivering a significant resource update at our Tanda Aguila project in Cote d'Ivoire. We were quick to identify the opportunity to increase the size of the resource significantly, so we actioned and brought in additional resources. Drilling with up to 10 rigs, we were able to decelerate the drill program from the original 70,000 meters to 167,000 meters, a significant achievement. Our original focus coupled with our dynamic exploration program supported the 303% increase in the size of the indicated resource to an impressive 4.5 million ounces at two grams per tonne. At TANDA, We're excited because we have not only identified a potential tier one deposit and discovered it for $11 per indicated ounce, but we have demonstrated our ability to continue to self-generate a project pipeline. An exploration program of $15 million is planned for 2024 with at least 60,000 meters of drilling. The Asafo deposit covers a mineralized trend of approximately 3.3 kilometers and mineralization remains open a long strike to the northwest, southeast, and at depth. So we'll drill around 25,000 meters to further delineate resources and look to convert a high proportion of the current indicated resources into reserves. On the next slide, we will also be drilling around 35,000 meters to help delineate several satellite opportunities that are located within five kilometers of the Asafoetida deposit. We have identified mineralization along the structural trend that extends over a 20-kilometer strike length, and we have similar structural settings at the Pala targets to the west and southwest, and the Igla east target to the northeast, which may be a potential repeat of the Asafu lithological structural contact. At the same time, we are advancing the preliminary feasibility study, which we expect to have finalized in late 2024. I hand you back to Ian for concluding remarks.

Thank you, Geria, Guy, Mark, and Jono. As you can see, we've certainly delivered against our key objectives in 2023, and thanks to the strong performance and momentum brought forward from 23, 2024 is certainly shaping up to be a pivotal year for Endeavor. Now, our key priorities for 2024 are, firstly, ensuring our operations continue to deliver against their objectives and that we achieve our production and cost guidance. And that's despite, as you all know, the illegal work stoppage that we had at Hyundai at the beginning of the year. Secondly, we'll deliver our two growth projects, which are now largely de-risk, both on budget and on schedule for startup in Q2 this year. And we're going to continue to advance Tanda Iguala exploration program and the technical study that we will complete by year end. Delivering on the operational performance and completing our growth projects on schedule and on budget is certainly going to unlock significant cash flow to support our capital allocation framework, which will prioritize strengthening our balance sheet and rewarding shareholders as we move into this more cash generative phase later this year. We're going to deliver against these key priorities while producing gold that creates lasting value for all of our stakeholders, our investors, employees, host communities, and importantly, our national governments. That word delivery is paramount. As I said to the team when I joined in January, my priorities are delivery, delivery, and delivery. I thank you for listening and I now hand you back to the operator and open up for any Q&A. Thank you.

Thank you, sir. Ladies and gentlemen, we will now begin the question and answer session. As a reminder, if you wish to ask a question, please press star 1 1 on your telephone and wait for your name to be announced. We will be prioritizing questions from covering analysts at this time. If you wish to cancel your request, please press the hash key. Once again, please press star 1 and 1 if you wish to ask a question. Please stand by while we compile the Q&A queue. Thank you. We will now be taking our first question. And our question comes from the line of Ovez Habib from Scotiabank. Please ask a question. Your line is opened.

Thanks, operator. Hi, Ian and the Endeavor team. I'm really glad to hear that the investigation is now behind us, and both the FIGI and development of Sabadala expansion are on time and budget. Just a couple of questions from me. Just starting off with Sabadal expansion, Ian, you mentioned that ore from the Massawa deposit is currently being processed in the first two BIAX reactors. And as you said, the bugs are bugging. What other milestones are you keeping an eye on as the project moves towards steady state?

Yeah, I think the best person to respond to that, Wernher Weiss, thanks for the great question. I'm going to let Mark respond to that directly.

Yeah, thanks, Wernher Weiss. We do have quite a large number of work packages that we are going through the commissioning and handover phase. And as that is progressing, the key is to continue to ramp up the concentrate production into the BIOS reactors. There are six in total, three primary and three secondary. So it's just a matter of progressively ramping that up. We will, though, be able to start to cascade some of the concentrate that has come through the BIOS reactor into the CIL circuit to be able to generate gold. And that is something that we are well and truly advanced with. And we remain on track for first gold in early May.

Thanks for the cover on that, Mark. And just maybe, you know, back to Ian, as PK and Sabudala, you know, ramp up into the second half of 2024, do any of your existing operations becoming non-core? And kind of, I'm just kind of moving towards the, is the strategy still to reduce exposure in Burkina Faso?

Look, at this stage, we don't see any potential disposals. I just spent the last week in Burkina Faso. And I have to say, in particular, mana, which I know everyone thinks, because it doesn't fit in the magic box, they tend to think, well, is that going to be disposed of? But I came away with a very clear sense that mana has some good upside potential. Importantly, and I think as I said to you before, we're using MANA as a kind of a for our underground mining expertise. And I think that's a very sound approach. A lot of the future within Endeavour, there will be increased underground mining activity. So to have the opportunity to hone our skills with underground mining, on an existing mine that will make a contribution, I think is sensible. So I'm not seeing any disposals at this stage. Okay, thanks, Adrian.

And just in regards to Senegal, we just saw a new president being elected in Senegal. Is the new government, you know, kind of any thoughts there in terms of, you know, this new government pro-mining? Have they talked about how they're looking into any sort of royalties and taxes in the country going forward?

I have not had an opportunity to speak to the new administration because, frankly, it isn't even in office yet. So it's probably a little bit early to make those comments, but certainly we would look forward to interacting with whoever comes into the administration. But, you know, there was obviously a lot of rhetoric leading up to the election. Let's wait and see how things settle down going forward. I think the one encouraging thing about Senegal is that despite some of the civil disturbance that took place leading up to the elections, the elections took place, the vote was carried out, there was a clear mandate for the new administration, and it shows that democracy works. And so we look forward to working with the administration as soon as they're in power.

Thanks for that, Ian. I do have a couple of questions for Juno on exploration, but I'll stop here and maybe get in touch with him offline. Thanks for taking my questions.

Pleasure.

Thank you. We are now going to take our next question. And the questions come from the line of Amos Fletcher from Barclays. Please go ahead. Your line is opened.

Yeah, hi, Ian and team. I just wanted to ask one question. I guess, Ian, you've had a couple of months in the job now. Could you talk about any adjustments you might like to make strategically going forward? For example, are you comfortable around the geographic footprint of the group, et cetera? Thanks very much.

Yeah, thanks, Amos. Look, I mean, I think already there's been a natural sort of rebalancing of the portfolio with the sale of Wagnon and Bungu. And then with the Le Figuet coming online and with Sabadala Masawa, you know, growing the portfolio, you're seeing a subtle shift in the should we call it the primary production base within the company. Certainly what I've seen on the visits, I've been to all the operations now, what I've seen is I think there is still potential for, to use I guess the current term, asset optimization. The real focus will be on making what we've got sweat, in terms of the existing operations. There's going to be lots of challenges for Mark and his team on bringing the two projects, taking them out of construction and getting them up to speed quickly in terms of production. So I think that's where our focus is going to be certainly over the next 12 months.

Okay, thanks very much.

Thank you. We are now going to proceed with our next question. And the question has come from the line of Kerry MacRory from . Please go ahead with your question. Your line is opened.

Hi. Good afternoon, guys. Maybe a question on Tanda Aguela. Ahead of the PFS, should we be expecting a resource update there ahead of that, or is the PFS going to be based on existing resource?

Kerry, I'll get Jono to respond to that.

Yes, we will get a resource update to be produced later in the year towards the end of it as part of our feasibility work.

Okay, great. Maybe with the PFAS underway, is there anything you can share in terms of what you're looking at and maybe how the CAPEX would compare to LIFGE? Obviously, LIFGE is on budget. In Cote d'Ivoire, is there anything in the Tandaguela project that is positive or negative relative to LIFGE from a CAPEX perspective?

Kerry, I think if you're trying to sort of position it relative to some of our existing operations, I mean, there's no doubt that Lefege could be used as an analog in terms of capex and what have you. The one major difference between Lefege and Tandeguela is that the potential size of Tandeguela is bigger. So, you know, It could be that we go with a similar-sized operation initially, looking to upgrade the capacity, and that's really going to form a lot of the basis of the pre-fees that we do. What is the optimum size? Do we go for something which is similar to Le Figueres? We know we've got a very good idea of capital there, designs. We know actually how to deliver a project like that fairly quickly. But whatever we did, we certainly want to make sure that we leave ourselves with sufficient flexibility that we could expand the size of the plant possibly quite significantly because you look at the potential in that area, it's looking very, very promising. So I think it's going to be a great another foundational asset for Endeavour Mines.

Okay, that's helpful, thanks. And maybe one last question, just any guidance on cash taxes for 2024 for the company?

I'll hand over to the master of coin, Guy.

Kerry, I mean, if we look at maybe just indicatively, you know, 22, 23, 23, clearly from a cash tax perspective was higher, arguably than what a number of people expected. That's largely due to the withholding taxes, and then Sabadala, where we had cash taxes in 23 that we wouldn't have seen in 22. If we take 23 into 24, it's unlikely to be as big a series of changes. We still will be doing our dividend declaration, so I imagine our withholding taxes would be broadly in line with what we saw in 2022. But then from a corporate income tax perspective, it's likely to be slightly lower. because our taxable earnings in 23 compared to 2022 were lower, and those will be the tax payments we're going to be making through 24. So slightly lower, but I wouldn't expect any major variation to what we saw this year.

That's great.

Thank you. We are now going to take our next question. And the questions come from the line of Anita Soni from CIBC World Market. Please ask a question. Your line is open.

Hi, good morning, Ian and team. The question on strategy, I guess, has already been asked, but I was wondering specifically on M&A, can we expect a different tone from you relative to what we saw historically? I think in the past three years for Endeavor had been quite acquisitive and, you know, you've been digesting those acquisitions for the past couple of years and I'm just wondering if you are more focused on organic growth or is there something that you look to perhaps alleviate the geographic discount that Endeavor has historically had?

Yeah, Anita, thank you very much. Look, I mean, yes, there's no doubt that there's been historically quite a sustained amount of M&A. And in fairness, that M&A did help position the company with slightly different assets than it had four or five years ago. To a certain extent, I think that phase has at least initially run its course. We've spoken a lot today about our success in exploration, our ability to discover ounces, and there are many companies that have great explorationists and discoverers. There are many companies that are very good at building mines. There aren't that many that actually have the ability to discover and convert those ounces into mines. And I think you've seen the numbers today that we've shown. We discover ounces very cost-effectively. and we're very good at converting those into mines and doing it very quickly. So we're in a phase now where we're going to continue with that. We're in no rush to have to do any M&A. Clearly, we are continually scanning the environment, but our focus at the moment is on getting these two projects up and running and certainly getting ourselves into a position where we can make a definitive decision on Tende Iguala or Asafo, as it will be referred to.

Okay, so speaking of the last acquisition that you did, which was Sabadolla Masala, is there any focus on, I mean, what can we expect in terms of reserve resource updates there in the next two to three years?

Yeah. Mark, do you want to comment on that, or John?

Thanks, Ian. One of the key focuses we're looking at in Sabha Dala Masawar is quite a significant increase in our exploration spend. So we're looking at about 21 million for this coming year. And there's a key focus on two aspects. One is the biox plant feed. We've got to find more mesawas on a relatively untested MTZ structure where we've got anywhere from 50 to 80 kilometres of potential strike. That is very, very underexplored. As well as higher grade oxide feed for the CIL side. So we do expect to have more discoveries and we do expect to have resource updates in the coming years.

Okay, I was just looking for any specific targets for year-end in 2024 and 2025.

No, not at the moment. Work is progressing and we'll have more clarity on the results of the year if it unfolds.

Okay. Second question is with respect to the... I wanted to touch on the comment first actually about the tone at the top in your press release. Can you explain what you meant by that when you were commenting and giving extra color on the results of the investigation?

Yeah, look, I mean, I think it's fair to say that any organization takes on the flavor of people who are leading it. And what we want to do is we want to make sure that, and as I said to people, as a company, our culture, we place a lot of importance on our values. We need to act with integrity, with transparency, and we need to make sure that we do the right things. I certainly want to make sure that everyone recognizes that our culture belongs to all of us. It's our responsibility to make the right decisions and to behave appropriately. And I believe that the closeout of the investigation has now given us the opportunity to have a clean sheet, draw a line in the sand, move forward, and make sure that we're doing things in the correct way. I believe that we can get there and I certainly wouldn't have agreed to take on this job if I felt that it was not possible to make sure that this is a good, clean organization.

Thanks for that. And then the last question is with respect to Lafayette and the comment about being one quarter ahead of schedule. I noticed that the guidance was not revised. Does that mean that we should be gearing towards the higher end of the guidance? Or why, if you're three months ahead, was there no change to the overall guidance number there?

Yeah, look, I mean, our guidance, there was a range between 90,000 ounces and 110,000 ounces for the year. So we can play around with that. We're going to see how the the mind works out. I mean, clearly, we're going to try our best to match the top end of the guidance, but I think there's sufficient range in that guidance specifically for Lefege that you can sort of move around across that range. And I'm happy with that guidance remaining as is.

All right. Thank you for that. That's it for my questions.

Thank you. We are now going to take our next question. And the questions come from the line of Sandeep Easi from Morgan Stanley. Please go ahead with your question. Your line is opened. Hello, Sandeep. Your line is open. Please go ahead with your question.

Thank you, operator. Good morning, team. So I had two questions. Firstly, on the shareholders' return program, you have clearly stated that the policy will be out sometime during the second half of the year. So, Ian, what are your initial thoughts on it? Do you agree with minimum dividend policy, or would you rather have a more sustainable policy that is linked to net income or cash flows?

Yeah, I think, Sandeep, the likely answer style of the program. It will be similar to what we've got now. There will be a minimum sort of guarantee. And then as and when we have excess cash flow guaranteed, we will be giving that back to shareholders. So very similar to what you've seen before. And I'm hopeful that certainly within the next three to four months, we'll be in a position to give more detail, more color to shareholders. But it will be, don't expect anything radically different in style from what you had before. We're just working on what we believe are fair numbers to return to shareholders.

Thank you. And then one for Guy. So the company has been building networking capital in total. It's around 200 million over the last two years. How much of that do you think is structural? And maybe one more is just if you can provide some guidance, like what sort of gold price is baked into your all-in sustaining cost for 2024? Sure.

Hi, Sandeep. Thanks. Yeah, on the working capital, I don't think that anything that you've seen over the last two years we should be regarding as structural. I think the vast majority of elements of the working capital build are timing. So in particular, if we look at either the $80 million in Q4 or, in fact, over fiscal 23, the build has been either in and around the timing of gold receivables and that really is a question of timing in a matter of weeks. The other part is VAT, and obviously the way we're structured as an industry means that we constantly have VAT receivables, and that is something that we work with both host nations, suppliers, and banks in order to try and manage. We will continue to do so. And then the third element, certainly an impact in 23 and in Q4 specifically within and around our building of stockpiles, which again, I see more as a timing simply because the majority of the stockpile build will have been associated with Sabadana Masawa and the ramp of our projects. Lafiga as well, we've done some pre-mining. I don't think that we should be accepting as a management team a structural increase in our working capital. We need to continue to look at efficiency gains across the balance sheet and to Ian's earlier point on ensuring that we sweat the assets. For me, it comes down to timing rather than structural. Your second question was to get me to go on record, I assume, with regards to ASIC guidance. So Sandeep, I think just to confirm, 1850 is what we had for ASIC guidance.

Okay, thank you. And if I can ask you one more question, just because this cash leakage has been quite material, it's amounting to more than 200 million in 2023. And during last conference call, you mentioned that there have been some steps taken to reduce that cash leakage. But now you mentioned that at least the cash taxes is expected to remain at last year level, which implies that dividend to minorities is going to be something similar. So have you gone back to that comment? And if you can just elaborate on that, thank you.

Sure. No, I'm not going back on the comment, but I think it just comes down to a mix of the way in which we look for repatriation. So the things that we're doing in order to try and improve our efficiency of cash repatriation, the first which you saw at the back end of 23 is local financing. So we have a Lefege facility in place now, which wasn't quite fully drawn at the end of 23, but is as we sit here today. That effectively alleviates any requirements for us to be doing the upstreaming. The second element is something of a return to where we were a couple of years ago, where we have now a mixture of intercompany loan accounts that will have been built up as we put our growth capex in place. So both Lefege and Biox are essentially providing us with those funding channels, that means that we can repatriate without dividends. The reference I made earlier to the question around cash tax was simply to highlight that our withholding tax in 24, for our budgetary purposes, is going to be in and around, i.e. not materially different to that which we saw in 2023. But it doesn't mean that we aren't able to repatriate slightly more than we did in 23. That's really the point.

Perfect. Thank you.

Thank you. That will conclude today's question and answer session and today's conference call. Thank you for your participation. You may now disconnect.