Gatos Silver, Inc.

Thank you for standing by. My name is Janine and I will be your conference operator. Defending today will be Dale Andres, CEO of Gatos Silver and Andre Van Meekert, Chief Financial Officer. We will conclude today's session with a question and answer period where other members of the Gatos Silver management team will be available. For those who have registered in advance, ask questions and would like to ask questions during this time, simply press followed by the number one on your telephone keypad. If you would like to withdraw your question, please press the pound key. At this time, all participants' lines have been placed on mute for the duration of the presentation to prevent any background noise. I would now like to turn the conference over to Dale Andres. Please go ahead.

Thank you, operator, and good morning, everyone. I just want to remind everyone at Gatos we will be making forward-looking statements, and those are subject to various risks and uncertainties that may cause actual results to vary, and Capital Silver does not assume the obligation to update any forward-looking statements. Just to start, as you can see on slide three, there was a lot going on in the third quarter. On September 5th, the company entered into a merger agreement with First Majestic. The proposed merger consolidates three world class producing silver districts in Mexico and that create creating a leading primary silver producer. We expect this transformative transaction to close in the first quarter next year, and that's of course subject to certain conditions, and I'll describe those a little bit more later in the presentation. But yeah, the Los Gatos joint venture had record cash flow from operations and record free cash flow. This was primarily due to the strong operating performance and higher metal prices in the quarter. We revised guidance upward in early October and the third quarter results put us in a strong position to achieve our revised annual guidance. I would also like to highlight the Los Gatos Joint Ventures free cash flow and that was 42.6 million in the third quarter. which provided sufficient cash flow to allow for 54.2 million of distributions to the joint venture partners during the quarter. As a result of these cash distributions, Gatto Silver had a cash balance of 114.8 million at the end of October. And last week, the joint venture did make another $40 million distribution with our share being 28 million. So, so far this year, The joint venture has made close to $150 million in distributions to its partners. On September 25th, we announced new mineral reserves and resources and an updated life of mine. The new plan extends the life of mine to the end of 2032, and that's at a milling throughput rate of 3,500 tons per day. Importantly, this added 36% to the total expected silver equivalent production over the life of mine, and that's compared to last year's plan. During the third quarter, we continued our focus on exploration drilling on both near mine and other targets in the large Los Gatos district. We are seeing some interesting initial results at central deeps, and I will talk more about that in the exploration slide. Turning to slide four, Mill throughput for the third quarter was 3,246 tons per day, and that's the seventh consecutive quarterly record. We do remain mine limited, so we're currently shutting the mill down for three to four days per month for extended maintenance, which we do with our own crews, and whether we need to do that time for maintenance or not, we shut it down for that amount of time. And that does ensure that the mill stays in very good shape But on an operating day basis, we're processing ore at a rate somewhere between 3600 and just over 3900 tons per day. Higher mill throughput compared to the third quarter of 2023 resulted in silver production being 9% higher at 2.42 million ounces and silver equivalent production, which includes zinc, lead and gold, was 11% higher at 3.84 million ounces for the quarter. Site operating unit costs were approximately $97 per ton this quarter, and that's 8% lower than the third quarter last year. Cash costs for the quarter were 4% lower than in the third quarter of last year as well, and that's despite the higher throughput rates. Our continuous improvement initiatives continue to help drive costs lower and productivities higher. do have a number of initiatives underway to further increase ore production from the mine including our underground equipment rebuild program and various operational improvement projects which are focused on planning maintenance and operational execution all in sustaining costs per payable ounce of silver after byproducts were nine dollars and 61 cents and that's per ounce or 35% lower than the third quarter of last year. And that's helped by strong byproduct production and sales and well within our revised guidance range for 2024. Following sustaining costs per payable ounce of silver equivalent on a coproduct basis were just over $16 and that's 9% lower than the third quarter of 2023. This was slightly above our guidance range And that really is a result of the higher realized silver price for the quarter. For all unsustaining cost performance, we do use actual realized prices. Moving to slide five, as a result of continued strong operational performance in early October, we announced an increase to our full year 2024 production and cost guidance. Silver production is now expected to be between 9.2 and 9.7 million ounces compared with the original guidance of 8.4 to 9.2 million ounces, and this represents an increase of 10% at the low end of the range and 5% at the high end. On a silver equivalent production basis, we're now expecting between 14.7 and 15.5 million ounces, and that compares to the original guidance of 13.5 to 15.0 million silver equivalent ounces and this represents an increase of nine percent at the low end of the range and three percent at the high end based on current mine plan sequencing at sarah los gatos the company expects four years zinc lead and gold production to be near the high end of the original guidance range uh the guidance ranges for each of those for each of those metals On the cost side, we now expect full year byproduct all in sustaining costs to be between $8.50 and $10 per ounce of payable silver. And that compares to the original guidance range of $9.50 to $11.50 per ounce. And this represents a decrease of 11% at the low end and 13% at the high end. And on a coproduct basis for the all in sustaining cost full year, it's expected to remain within our original guidance range, and that's between $14 and $16 per ounce of payable silver equivalent. We remain on track to meet the sustaining capital expenditure guidance at Cerro Los Gatos of 45 million and remain on track for total exploration and resource development drilling expenditures of 18 million in 2024. I'll now turn the call over to Andre to present our financial results. Andre?

Thank you, Dale. Good morning, everyone. The 70% owned Los Gatos joint venture's strong operating performance and strong realized middle prices resulted in another quarter of robust cash flow generation. Cash flow provided by operations was $58.2 million, a new quarterly record. The LGJV generated free cash flow of $42.6 million This quarter, 199% higher than the $14.3 million in Q3 2023, and also a new record for the LGJV. The increase from the compatible quarter last year was primarily due to significantly higher revenues as a result of higher metal prices and higher sales volumes. Cash flow used in investing activities was $15.6 million in Q3 2024. $400,000 higher than in Q3 2023. Of that amount, $12.9 million was spent on sustaining capital expenditures and $2.1 million on resource development running. The LTJV made cash contributions distributions of $54.2 million during the third quarter to the LTJV partners. And as a result of the continuous strong free cash flow, Generated in the third quarter, the joint venture made an additional $40 million in capital distributions on November 7th, subsequent to the end of the quarter. In total, the joint venture has made $149.2 million of distributions to the two partners this year. Now turning to slide seven to look at the financial results of the Los Gatos joint venture for the quarter. Revenue has increased by 40%. to $93.8 million in the third quarter of 2024. Higher volumes of metal sold and higher realized metal prices contributed to the significant increase in revenue for the quarter. The provisional revenue adjustment was a $1.5 million positive adjustment this quarter compared to a $3.2 million positive adjustment in Q3 2023. Cost of sales decreased slightly despite the higher sales volumes. Depreciation, depletion, and amortization expense increased by approximately 7%, primarily due to the larger capital base, partially offset by the impact of the increase in the mineral reserves and the extension of the life of mine. An income tax expense of $13.9 million was recorded compared to income tax benefit of $900,000 in Q3 2023. Income tax expense increased primarily due to higher taxable income. Finally, the LGJV recorded net income of approximately $25.7 billion, a significant increase from the $15.1 million net income recorded in Q3 2023. Turning to slide eight to review the financial results for Guytel Silver. Net income for the third quarter of 2024 was $9.9 million, approximately 200% higher than in Q3 2023. Basic and diluted earnings were $0.14 per share this quarter compared to $0.05 per share in Q3 2023. Adjusted net income was $15.2 million for Q3 2024 compared to $3.3 million for the prior year period. Net income was adjusted for the costs associated with the proposed merger with First Majestic. On a per share basis, adjusted net income was $0.22 per share Basic. Equity income in affiliates increased to $18.2 million, primarily due to the increase in net income of the LTJV. The company incurred general administrative expenses of $10.4 million compared to $7.5 million in Q3 2023. The $2.9 million increase is primarily due to the $5.3 million of costs in the quarter associated with the proposed merger with First Majestic. partly offset by a decrease of $1.1 million in non-cash stock-based compensation expense, a decrease of $900,000 in legal and consulting fees that are not associated with the proposed merger, and a decrease of $400,000 in insurance expense. And lastly, other income includes $1.5 million of the quarterly management fees received from the LGJV for the quarter. Turning to slide nine, As was mentioned earlier, the joint venture paid cash distributions of $54.2 million to the JV partners, Gatos Silver and Doha, during the third quarter, of which we received $37.9 million. As a result, Gatos Silver ended the third quarter with a cash balance of $116.7 million. The company and the LGJV had cash and cash equivalents of $114.8 million, and $47.3 million respectively on October 31st, 2024. And on November 7th, the LGJV made another capital distribution of $40 million, of which the company received an additional $28 million. Both GSI and the LGJV continue to remain debt-free. I will now hand it back to Daniel.