Lundin Mining Corporation

Good day ladies and gentlemen, and welcome to the London Mining Fourth Quarter and year-end 2022 financial results and webcast. At this time, all I say in this anonymous mode. Following the presentation, we will conduct a question and answer session. If at any time during this call you require my assistance, please press star 0 for the operator. This call is being recorded on Thursday, February 22, 2024. I will now like to turn the conference over to Jack London, President and CEO. Please go ahead.

Good morning, and welcome to Lundy Mining's full year and fourth quarter 2023 earnings call. Last night, we reported operating and financial results. A copy of our press release and slides are available on our website, where a replay of this call will also be made available. Before we begin our presentation, I would like to remind everyone that yesterday's results and certain comments on the call include forward-looking statements. I will draw your attention to the cautionary statements on slide two for reference. On the call, I am joined by other senior members of our executive team. Tyler Paulson, our Senior Vice President and Chief Financial Officer, and Juan Andres Morel, our Senior Vice President and Chief Operating Officer. I would also like to take this opportunity to welcome Pat Maron to the team as Executive Vice President, Technical Services. Pat has extensive operational and technical experience as the previous SVP Canadian operations for Newcrest and also for Goldcorp. As well as I would like to announce another new addition to the team, Joel Adams, as the new commercial vice president. Joel brings with him extensive experience in the downstream segment of our business, having previously worked for Trafigura and prior to that, Glencore. Prior to commencing the presentation, I intend to address a recent unfortunate incident at our Nevis Corvo mine in Portugal, where a fatality occurred last week. We are deeply saddened by this incident, recognizing that the challenging circumstances it presents. Our heartfelt thoughts and support are extended to the family and coworkers of our deceased colleagues during this difficult time. We will continue our efforts to send all of our workers home safe at the end of each day and are always committed to the health and well-being of our workforce. I will now focus the audience's attention to our 2023 corporate highlights. The company underwent a transformative year in 2023, marked by a comprehensive restructuring of the corporate head office, which was subsequently relocated to Vancouver in September. We increased our operational and technical strength of our team, which is now in place to bring the company through the next phase of growth. Production statistics will be further expanded upon during this presentation. However, I'm pleased to report that we met guidance for all metals, including a record for copper and zinc production for the company. During the year, we acquired the Casaronas Mine, which will be a building block for the future of the Vicuña District. Included within the acquisition of this operation is a large and highly prospective underexplored land package of nearly 60,000 hectares. With great enthusiasm, we have launched the first significant exploration drill program at the mine since it began operating in 2013. At Candelaria, the environmental impact assessment approval has granted us an extension of mine life from 2030 to the year 2040. Current reserves surpass this timeline, and this milestone enables us to reassess the underground expansion, which will include updating the mine plan and CAPEX this year. In December, Javier Mille assumed the role of President in Argentina. We anticipate collaborating with the President and his administration to progress the Jose Maria project. We had the privilege of meeting with the President and the Minister of Economy along with the Secretary of Mining in January to discuss matters related to Lundin Mining and Jose Maria and also the Lundin Group's longstanding presence and success within the country. Lastly, we updated our mineral reserves and mineral resources and were able to grow our reserve base by 26% with the acquisition of Cacerones to about 10.5 million tons of proven and probable copper reserves. While at Candelaria, additional drilling contributed to an increase in overall resources that we hope to convert to reserves in the future. Operationally, our assets performed well, delivering on guidance in all consolidated metal categories. Not shown on this slide, however, nickel and gold production achieved the upper end of the guidance ranges. As mentioned earlier, annual copper production was a record for the company at 315,000 tons. Cross our base metals portfolio, the zinc expansion project at Nevis Corvo, otherwise known as ZEPP, is coming to fruition, leading to a record quarterly and yearly zinc production results. At Zinc Reuven in 2023, improved recoveries from the sequential flotation project were achieved. However, a longer than anticipated ramp up resulted in a slight miss on production guidance. We generated significant adjusted EBITDA of 1.4 billion. operating cash flow of over $1 billion and free cash flow from operations of $345 million. Yesterday, our board of directors declared a regular quarterly dividend of $0.09 Canadian per share. The annualized dividend of $0.36 Canadian offers a 3% yield and continues to be a leading return amongst our peers. We directly returned over $206 million in dividends in 2023. and more than 1.2 billion to shareholders since 2017 through dividends and share buybacks. Our ongoing focus remains on generating value through strong operational performance and disciplined capital allocation, which supports strategic growth initiatives to create long-lasting and sustainable shareholder returns. I will now hand it over to Juan Andres to go through the operational results in more detail.

Thank you, Jack. We previously released our production results earlier this year, so I will speak briefly to some of the details provided in our year-end release. As mentioned by Jack earlier, the company met metal production guidance on all consolidated basis for all metals in 2023, while nickel and gold productions achieved the upper end of the guidance. Copper production was a record for the company at 315,000 tons for the year and 103,000 tons for the quarter. Both Cacerones and Eagle exceeded original guidance. Candelaria had a strong fourth quarter, processing 7.8 million tons of ore and producing 42,000 tons of copper, finishing off the year with the best quarter. This was the result of softer ore than planned, which drove throughput in the mill and higher grades compared to previous quarters. Full-year production at Candelaria was 152,000 tons of copper, which was the midpoint in the guidance. Cacerones has performed extremely well and exceeded the upper end of the original guidance of 60,000 to 65,000 tons for the second half of the year and produced 65,200 tons of copper. During the fourth quarter, the mine produced 35,000 tons of copper and 928 tons of malt. Higher production volumes were driven by higher throughputs and recoveries. Throughput in the mill was 8.3 million tons for the quarter, or 4,200 tons per hour, which is close to the main plate capacity for the processing plant. We expect to see similar levels of throughput in 2024. Since the acquisition, Cacerones has shown steady improvement in the throughput driven by higher mill utilizations and better college performance. As mentioned, production at Chapada was second-half weighted last year. During the quarter, higher-than-anticipated grades offset lower mill throughput to produce 12,900 tons of copper, which is in line with the third quarter. In the first half of the year, Chapada produced 20,500 tons versus the second half at 25,100 tons of copper, and on a full-year basis, 45,700 tons. Coal production for the quarter totaled 44,000 ounces for the fourth quarter, and for the year, 149,000 ounces, which was in the upper end of the original guidance. As I mentioned earlier, fire throughput at Candelaria and improved grades and recoveries at Chapada contributed to the overall coal production. Let's move to slide number seven. Zinc production was higher quarter over quarter at 51,000 tons and is the new quarterly record as mentioned by Jack earlier. Production at Neves Corvo increased quarter over quarter and produced 31,000 tons of zinc. We're seeing the benefits from the zinc expansion project as it ramps up in capacity. During the year, the zinc circuit was able to process 2.0 million tons. During the quarter, zinc-rubin production was impacted by zinc ore availability, which lowered throughput and grades during the quarter. 19,700 tons of zinc were produced in the quarter and 76,000 tons for the full year, which represented a slight misguidance for zinc-rubin. On a consolidated basis for the year, Lundin Mining produced 185,000 tons of zinc, which was in line with 2023 guidance. Nickel production was 3,700 tons for the quarter and 16,400 tons for the year, which beat the original guidance for Eagle. This was primarily driven by higher grades and recoveries over the course of the year. Operationally, all our assets performed well, and we're seeing the results from our improved planning cycle and operational philosophy. I will now turn the call over to Tyler to provide summary on our financial results.