Lundin Mining Corporation

Good day and thank you for standing by. Welcome to the Lundeen Mining fourth quarter 2025 and year-end financial results presentation. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you'll need to press star 1 1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1 1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Jack Lundeen, President and CEO. Please go ahead.

Welcome to Lundeen Mining's full year and Q4 2025 earnings call. Our operating and financial results were released last night, and the news release, presentation, and webcast replay are available on our website. All amounts are in U.S. dollars unless stated otherwise. You may have noticed the new look in our materials for this call. Today, we are pleased to introduce to you Lundin Mining's new brand, which is aligned with our copper focus strategy and long-term growth ambitions. Over the past two years, we have completed transformative transactions that have streamlined our portfolio and sharpened our focus on copper. Our new brand identity brings together our corporate and sites under one unified, recognizable look and feel while strengthening our visibility in the regions where we operate. You'll see the updated brand across our investor materials, website, and operations, starting with the financial results we are discussing today. About the logo and colors. The stylized L in our new logo symbolizes momentum and growth, while our new color palette is inspired by copper and the landscapes where we operate. Before we start, we will play a quick video capturing our new look. Please enjoy.

We're introducing a new look for Lundin Mining. We have reshaped our portfolio and sharpened our focus, centered on one of the world's most essential metals, copper. In South America, brownfield expansions at our Candelaria, Casaronas and Chapada mines are expected to deliver strong gains in the near term. In the longer term, our Vicuña project offers one of the world's most promising copper-gold-silver districts. As global demand for copper and critical minerals accelerates, our teams play a crucial role in supporting electrification and modern infrastructure. Our new look doesn't change who we are or how we operate. It celebrates our growth, signals our momentum, and unites our global teams under one cohesive identity. With our portfolio realigned and our growth plan clear, we're driving forward with a brand that reflects who we are and where we're going. Built for growth, ready for opportunity.

As a reminder, yesterday's results and some remarks made on today's call will include forward-looking statements. Please refer to the cautionary statements on slide three for reference. With me on the call today is Juan Andres Morel, our Chief Operating Officer, and Titor Polson, our Chief Financial Officer, to present operating and financial results for the company. 2025 was another milestone year for Lundin mining on nearly all fronts of the business. And we have positioned ourselves on a clear path to becoming a top tier copper producer, completing three transformative transactions during the year, which rationalized our portfolio and sharpened our focus on our existing assets in South America. In January, we finalized the merger of our Eagle mine with Talon metals to create a new pure play American nickel company. This transaction unlocks meaningful synergies, including the opportunity to leverage the Humboldt Mill as a shared, centralized processing facility. At the same time, Lundin Mining has retained a 20% ownership in the combined company, and me and Juan Andres have joined the board, along with former managing director of Eagle, Darby Stacey, as the new CEO of Talon. With this streamlined asset base, we continued to advance our growth initiatives. This includes refining growth plans for our three operations and maturing the large-scale growth plans for the Vicuña project. We recently announced our updated mineral reserve and resource statement, and on an attributable basis, the company now has contained metal of over 35 million tons of copper, over 60 million ounces of gold, and over 960 million ounces of silver, effectively doubling our copper resource base and adding a significant amount of gold and silver to our mineral resource inventory. We delivered our best financial performance in the history of the company and generated record revenue of more than 4.1 billion and adjusted EBITDA of 1.9 billion for the year from continuing operations, not including the Eagle Mine. We declared our 39th regular quarterly dividend paid out $106 million in dividends during the year and purchased 15.1 million shares for a total return of $256 million to shareholders, demonstrating our commitment to shareholder returns as part of our capital allocation strategy. We are pleased to reinforce today several recent announcements that have been published by the company. The highlight from earlier this week was the announcement was that we announced the results of the Integrated Technical Report on the Vicuña project, highlighting an incredible project capable of producing over 500,000 tons of copper, 800,000 ounces of gold, and over 20 million ounces of silver during its peak production years, which would position it as a top five in terms of scale on all of these metal categories. We also announced commitments to upsizing our revolving credit facility to $4.5 billion to enable us to fund the next phase of growth for our company. Operationally, our assets performed exceptionally during the year, and we were able to increase copper guidance in the third quarter while also reducing our consolidated cash cost guidance range. We met revised guidance on all consolidated metals in 2025. Safety remains our top priority, and during the quarter, we continued to strengthen our safety culture through visible leadership and targeted training programs across all operations. We continued to improve our total recordable injury frequency rate, which resulted in achieving the lowest rate in the company's history. Including Eagle, consolidated copper production was 331,000 tons of copper for the year, led by strong performance from Casaronis, and consistency from Candelaria and Chapada. Gold production was 142,000 ounces for the year. Casaronis annual production for copper was at the top end of the most recent production guidance range, and the fourth quarter copper production was the highest since the mine was acquired by the company in 2023. From continuing operations, we generated adjusted EBITDA of $1.9 billion and adjusted operating cash flow from operations of $1.6 billion during the year, both annual records for the company. For the third year in a row, we met copper guidance, reflecting the accuracy of our planning cycle and our disciplined focus on operational consistency. I will now hand it over to Juan Andres to go through the operational results in more detail.

Thank you, Jack, and good morning, everyone. We shared our production results earlier this year. I will now briefly highlight some of the key points from the year-end release. The company exceeded original copper guidance and met revised guidance across all metals. The company produced 331,000 tons of copper this year and 87,000 tons in the fourth quarter, inclusive of the Eagle Mines. Gold production for the fourth quarter totaled approximately 34,000 ounces, and for the full year, 142,000 ounces, which was in line with guidance. Throughout the year, Candelaria maintained steady operations with 95% meal availability and processed approximately 7.8 to 8.1 million tons of ore each quarter and 32 million tons in the year. Candelaria produced a total of 145,000 tons of copper in line with annual guidance. In the fourth quarter, the mine produced 34,000 tons of copper, which was slightly less than previous quarters due to planned lower head grades. Cacerones performed very well. An annual production for copper beat original guidance and was at the top end of the most recent production guidance range. Fourth quarter copper production was the highest since the mine was acquired by the company, as Jack mentioned earlier. Cacerones produced 133,000 tons of copper during the year and 40,000 tons in the quarter. High production was driven by higher head grades and strong cathode productions. Additional oxide material placed on the dam bleach, together with improved leaching practices, increased copper cathode production to 25,800 tons in 2025. As mentioned at our Capital Markets Day, these optimization efforts have led our annual copper cathode production forecast to increase to approximately 26,000 to 28,000 tons in 2026 through 2028, an improvement of 6,000 to 8,000 tons from prior levels. Chapada was slightly second-half weighted this year. During the fourth quarter, throughput was 6 million tons, which produced 11,200 tons of copper and 44,000 tons of copper in 2025, which was at the upper end of guidance for the year. And finally, Eagle produced 2,200 tons of nickel in the quarter and for the year was in the midpoint of guidance at 10,000 tons. Our assets demonstrated positive progress in 2025. Moving forward, our focus will remain on operational enhancement to optimize margins and further improve the cost profile of our holdings. I will now turn the call over to Tyler to provide financial summary.

Thank you, Juan Andres, and good morning, everyone. So before going into the numbers, as a reminder that with the completion of the sale of our Eagle Mine, this operation is presented as discontinued operations in our income statement. and the assets and liabilities on the balance sheet have been classified as held for sale as of December 31st, 2025. As Jack mentioned earlier, robust copper and gold production combined with unwinding concentrated inventory along with high commodity prices led to an outstanding financial performance for the period. We reached record revenue and adjusted EBITDA for 2025. We generated close to 1.4 billion in revenue during the fourth quarter, quarter, including 52 million from discontinued operations. Revenue for the full year amounted to a record of 4.5 billion, including 409 million from discontinued operations. Our sales mix remains predominantly leveraged to copper and has increased from last year, where 75% was generated from copper compared to the four quarter this year, where the copper component accounts for 87% for the quarter. Moving to the next slide. In the third quarter, we incurred a shipment delay of approximately 20,000 tons of copper concentrate at Casarona due to weather-related impacts. And this resulted in the company carrying higher than normal inventory levels at the end of Q3. This elevated level of inventory has been unwound during the fourth quarter, leading Casarona to sell 45,000 tons in the quarter. Pricing adjustments on prior period sales of concentrate had a positive impact on revenue by 83 million in the fourth quarter, helping drive financial performance. In the fourth quarter, we realized a copper price of $5.89 per pound, which was higher than the LME quarterly average of $5.03 per pound. For the full year, our average realized price was $4.91 per pound for copper, which is materially higher than the annual LME average of $4.51 per pound copper. This high realized price is driven by the fact that a disproportionate share of our annual sales occurred during the fourth quarter when the market prices were higher than the annual average price. At the end of the fourth quarter, approximately 80,000 tons of copper were provisionally priced at $5.64 per pound and remained open for final pricing adjustments. Moving to slide 13. Consolidated production costs for the fourth quarter amounted to 585 million, including discontinued operations, which is higher than previous quarters due to the elevated sales volumes and certain one-off costs expense in the fourth quarter. At Candelaria, the company finalized ahead-of-schedule labor renewal agreements with Candelaria's five unions during the fourth quarter, which led to a one-time increase in costs due to signing payments. Cash costs for the fourth quarter were higher than previous quarters and were similarly impacted by the one of union signing bonus payment. The higher sales volume at Casarona for the fourth quarter draw a high absolute production cost for the quarter. Cash costs for the fourth quarter were in line with the previous quarter and Casarona full year cash cost of $2.17 per pound is towards the bottom end of guidance. Chapada's full year cash cost of 75 cents per pound outperformed the revised range or guidance range of 90 cents to $1 per pound. Cash costs were positively impacted by the favorable gold pricing compared to forecast, resulting in improved byproduct credits for both the full year and the fourth quarter. Cost control across all sides remain very robust, and this has resulted in the company's cash costs for the full year of $1.87 per pound coming in below the bottom end of our original guidance and towards the bottom end of the revised guidance. This better-than-expected outcome was achieved despite the unbudgeted union agreement payment at Candelaria being accelerated from 2026 into 2025. Slide 14 shows our total capital expenditure for the full year, which amounted to the sustaining capex of $499 million inclusive of Eagle, compared to revived guidance of $510 million. The lower sustaining capital investment was primarily the result of reduced stripping and a delay in capital projects at Cacerones. Capital expenditure at Pecunia was $167 million compared to guidance of $215 million, with this underspend mostly relating to timings. Our full year and four quarter key financial metrics are presented on the next couple of slides. As previously stated, total revenue for the year, including discontinued operations, reached close to 4.5 billion with almost 1.5 billion generated in the fourth quarter. We generated adjusted EBITDA of 1.9 billion for the year from continuing operations, including 686 million in the fourth quarter. Adjusted operating cash flow from continuing operations exceeded 1.6 billion for the year, including over 665 million in the fourth quarter. Moving to the next slide, free cash flow from continuing operations was 774 million for the year and 388 million for the quarter. Operating cash flow benefited from higher commodity prices and was offset by a significant negative working capital build of $414 million for the full year and a working capital build of $132 million for the fourth quarter. Full year adjusted earnings from continuing operations amounted to $688 million and $364 million for the quarter. Earnings from continuing operations for the quarter amounted to over 900 million and were positively impacted by a non-cash deferred tax recovery at Casarone of 517 million, with the company now having recognized a larger portion of the 3.9 billion tax loss at Casarones. Slide 17 presents in greater detail the sources and uses of cash in 2025. In 2025, our continuing operations generated just over 1.6 billion in cash flow before working capital. This cash generation includes close to $400 million paid in cash taxes during the year. After netting capital expenditure and non-cash working capital movement, the free cash flow from continuing operations amounted to $539 million. As per the company's shareholder distribution policy, the company executed on its share buyback program totaling 150 million and combined with the dividends for the fourth quarter 2024 and the first three quarters 2025 has paid an additional 106 million in dividends. Dividends to non-controlling interest in Candelaria and Casarone amounted to 138 million for a year. The company had a cash outflow of about 150 million on lease payments, interest, and hedges, and ending the year with a net cash position of 77 million, excluding capital leases. The company has thus significantly strengthened its balance sheet during 2025, with the sale of the European assets being pivotal to this strengthening. With last week's announcement to upsize our revolving credit facility from 1.75 billion to 4.5 billion, combined with the strong cash generation from our producing assets, the company is now financially primed to embark on the capital investment required to unlock the exciting Vicuña project in Argentina. And with that, I'll now turn the call back to Jack.

Thank you, Titor. In January, we announced updated three-year guidance for production, operating cash costs, and capital expenditures for 2026. Copper production is forecast to be 310,000 to 335,000 tons on a consolidated basis in 2026. Compared to last year's three-year outlook, mine sequencing optimizations are expected to increase copper production by 20,000 tons in 2027 while the midpoint of 2026 has been adjusted by 5,000 tons, resulting in a net increase of approximately 15,000 tons over the two-year period. Revisions to Candelaria's 2026 Copper and Gold Production Guidance incorporates lower underground mining rates in the first half of the year as the company insources the underground mine operations contractor. The production profile is forecast to be modestly weighted towards the second half of the year due to higher expected grades from phase 12. We expect the insourcing strategy to lead to cost savings and improved productivity for our underground operations, which represents a significant value driver for the future of our Candelaria operation. At Casaronas, 2026 estimates remain unchanged. while copper guidance in 2027 increased by 10,000 tons to range between 115 to 125,000 tons, resulting from higher cathode production and increased mill throughput. Chapada copper production guidance has been revised upward by approximately 5,000 tons for 2026, resulting in an anticipated range of 45 to 50,000 tons. Gold production guidance also increased by 10,000 ounces for 2027 compared to previous guidance. The updated mine plan reduces the dependence on lower-grade stockpile material from around 25% down to about 10%, enhancing copper and gold recovery rates over the three-year period. Consolidated gold production is forecast to be 134 to 149,000 ounces in 2026 for the company. Consolidated cash cost for 2026 is projected to range from $1.90 to $2.10 a pound of copper after accounting for byproduct credits. Total sustaining capital expenditures are forecast to be $550 million, consistent with prior year's guidance. Candelaria and Casaronas account for approximately 80% of the sustaining capital budget. with the majority of expenditures directed to stripping, mine development for Candelaria's underground, tailings, and mining equipment purchases and replacements. Expansionary capital expenditures are forecast to be $445 million, and this includes the 50% expenditure related to our 50-50 joint arrangement between the company and our partners BHP for the Vicuña project. This ramp up in expenditure gets us ready for a sanction decision on Vicuña as early as the end of this year. Included in expansionary capital expenditures, we also have 35 million in expansionary capex at Candelaria, which includes pre-production stripping related to phase 13 in the open pit. Exploration this year is estimated to be 53 million, and we will target drilling almost 70,000 meters between Casaronas, Candelaria, and Chapada. The drill program at Casaronas will primarily focus on defining the size of the Angelica deposit, both in terms of leachable copper resources and the underlying copper molybdenum sulfide mineralization, where we are targeting a maiden resource next year in calendar year 2027. Additional drilling at Casaronas will be directed towards new discoveries and testing at least two new district exploration targets, Centauro and Cordillera. At Candelaria, drilling is designed to continue expanding the underground resources and also growing the shallow La Española deposit and neighboring La Portuguesa target. At Chapada, additional drilling at Sauva will continue to further define higher-grade resources that will be incorporated into an updated resource estimate later this year, which will also be embedded within the updated technical report for Chapada. I'll now hand it back over to Juan Andres to give an update on the SAUVA project. Thank you, Jack.

As mentioned at our CMD last year, we are advancing key growth initiatives at our Chapada mine, including the installation of an additional ball mill and the development of the nearby SAUVA satellite deposit. The ball mill installation will allow a finer grind size, which is expected to increase recoveries by approximately 5% for both copper and gold for the entire life of mine. At the same time, ore from Zauber deposit will provide higher grade ore, helping to offset the lower grade material at Chapada and further enhance overall plant performance. The pre-feasibility study for Zauber has been completed and a feasibility study has been initiated. We are targeting to make a sanctioning decision in the second half of 2026, and we expect construction of the new ball mill to begin by the end of 2026 or early 2027, which will put the commissioning of the ball mill near the end of 2027. Permitting at Zauber will continue to advance in parallel, and potentially we could see first ore from Zauber in 2029, subject to permit timelines. The pre-feasibility study highlighted an average production increase of 17,000 tons per annum for copper and 32,000 ounces per year over a five-year period for Phase I. We anticipate this profile will improve as the mine plan is optimized to include Phase II. I will now turn it back to Jack.

On Monday, we announced the results of the vicuna integrated technical study signifying an important milestone for this impressive district scale project. At full capacity, the district is expected to produce over 500,000 tons of copper 800,000 ounces of gold and 20 million ounces of silver each year. The project benefits from a first quartile cash cost profile and will be built to generate sustained significant cash flow for many decades throughout the cyclical nature of the base and precious metal sectors. Furthermore, the stage development approach is designed to use cash flows to fund subsequent expansions, optimizing capital efficiency and value creation. It is great to start off in 2026 with these recent company highlights and on the heels of a record-breaking year for the company. Divesting our European assets simplified our portfolio and strengthened our balance sheet, allowing us to focus on future growth across our South American sites. Our partnership in the Vicuna District positions us for multi-year growth toward becoming a top 10 copper producer. Filo del Sol, one of the largest undeveloped copper, gold, silver deposits globally, and our joint venture with BHP creates a pathway to form a new multi-generational mining district. Anchored by consistent operational performance, we delivered record revenue of $4.5 billion, declared our 39th consecutive quarterly dividend, and returned a total of $256 million to shareholders annually. through dividends and share buybacks, highlighting our financial discipline and commitment to shareholder returns. Lundin Mining is uniquely positioned with a strong balance sheet, funding commitments for our ambitious pipeline of growth, a simplified portfolio, and a strategic partnership with BHP in the Vicuna District, offering unparalleled growth opportunities for our stakeholders. With that, I would like to open the lines for questions. Thank you.

As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by while we compile the Q&A roster. Our first question comes from Johannes Grunzelius with SV1 Markets.

Yes, hi, it's Johannes. I have two questions. So the first one is on Casarones where you had really good grades as you highlighted. I can see that your annual sort of copper output is 158 or something and your full year 26 guidance is 130, 140. Are you seeing that more conservative now than you did when you launched the guidance first in December? That's my first question.

Hi, this is Juan Andres. As I mentioned on the presentation, we have seen a significant improvement in the performance of the cathode plant. So we are forecasting more cathode production, and that is somehow upsetting some of the drops in the grades in the following year, but we are maintaining our guidance overall as previous years.

All right. Okay. So it was in sort of in line with your expectations, the Q4 volumes. They didn't surprise you? No, it was as expected in the mine plan. Okay. Okay. Okay. Good. Thank you. And the second question, and you partly answered it in your presentations, but when I look at the OFEX versus, for example, you know, your ore volumes in Candelaria, Casaronas, it's a pretty high, you know, increase in OPEX per tonne ore mined and ore milled. And you mentioned there was some negotiations with unions that could explain that. But could you, how should we view it? How much did cost move up sort of on an underlying basis? And is this like in line with the mining industry right now in Argentina and Chile?

Hi, Johannes. It's Tijder here. I mean, first off, I mean, it's a great result that we managed to land these five agreements with the unions at Candelaria ahead of schedule because that eliminates any risk of any production disruption in 2026. But we are not disclosing the exact details of what those bonus payments are. The sequence here is that every three years we enter into negotiations with the unions and normally what happens is you're paying certain one-off bonuses to the labor force in order to extend stability for the next three years. And the way we account for that is that whenever we pay these bonuses every three years, we expense that payment in the quarter where the payment occurs. So that did elevate, I should say, the Candelaria absolute costs in Q4, but the return from that is that we now have stability for the next three years. And at Casarona, the absolute costs are also up. And that's simply because we report the production costs as per the sold volume, not the produced volume. And we sold an elevated amount of volume for Casarona in Q4. So that's what's driving a higher absolute production cost. But if you look at it on a unit basis, it's as low as it was in Q3. Yeah, I agree.

Thanks for clarifications and congratulations to great results. Thanks. Thank you.

Our next question comes from Daniel Major with UBS.

Hi. Can you hear me okay? Yep. Yep. Great. Thanks.

Just on the Suva update, I'm just looking at the slide from the Capital Markets Day on the scoping study. I mean, you're sort of guiding for a similar rate of production. I think it was 15 to 20,000 tons per annum of copper. It's now 17. It's fractionally lower gold. But the parameters seem somewhat different. I mean, the capex has gone down from 155 to 110. The grades are lower. The throughput is lower, but the production is the same. Can you just run us through what the difference is between what you're presenting on

now relative to the capital markets day and kind of what's changed particularly the reduction in capex was that just a conservative initial assessment or has the scope changed much morning Daniel this is Juan Andres thank you for the question so in doing the CMD we guided based on a conceptual study And as we move into the pre-visibility study, of course, we increase the level of understanding of this opportunity. In the original CAPEX estimate, we have considered secondary crusher for the addition of the ball mill. During the PFS, we learned that that was not necessary. So that was basically removed from the CAPEX estimate. And the rest of the scope remains the same. So... We have the ball mill, which is roughly $65 million. And then for the saúba itself, for the open pit, it's another $45 million for road construction, liners for the waste dumps, and a water treatment plant. So that is basically the scope. So that is what triggered this capex reduction. Of course, there were some minor adjustments to the mine plan. given also changes in the metal prices that were used for mine design, and that explains the small changes in the tons and grades.

Okay, thanks.

Second question, just around the treatment and refining charges, I think Antofagasta settled what looks like the benchmark essentially close to zero. Would it be fair to say that you're following similar terms? And then is there any difference in the realization when we look at what you're putting in your accounts with treatment and refining charges? Is that going to dramatically decline? Or are there any additional charges incremental to what a pretty close to zero benchmark represents?

Yeah, those are also the numbers we are hearing, certainly For volume going into China, I think it'll be segmented a little bit more than what normally was the case. So we'll have to see what the Japanese rates land up and other rates. But generally speaking, it's trending very well. I mean, within our cost guidance for 2026, we have assumed 25 and 2.5. So I think we're likely to land ahead of what we assumed in our guidance. I think that's as much as we can say. And obviously, you know, then depending on the blend of how much we sell on the fixed-term contracts versus spot markets, that might ultimately also impact the weighted average TCRC charges we have for the whole year.

Okay, but you've assumed 25 and 2.5, so... There's also quite a bit of downside, even though it's a relatively small number. Okay, thanks. Yeah, and finally, I'll let someone else go. I just wanted to follow up on some of the discussions in the call earlier in the week around streaming and Vicunia. I mean, it felt like the narrative from BHP on their call following the announced transaction at And Tamina was the reason they were happy to stream that was that there wasn't a huge amount of long term growth optionality beyond life extension, which may not be the same dynamic in Vicuna. Can you just give us another summary of how you're viewing streaming in the district and confirm whether it would be at all possible that one party out of the JV would stream and the other would not?

Hi, Daniel. It's Jack here. So I think as we were mentioning and as we released on Friday last week, we've we've upsized our our near near finalization of upsizing our revolving credit facility up to four point five billion U.S., which would put us firmly in position to be fully financed for our portion of the build. Now, that also gives us the optionality to look at other forms of financing, streaming being one of them. You know, we're seeing that there are some uniquely structured streaming deals being announced in the market, and we're obviously following what our partners, BHP, are doing at Antamina. I think it opens up optionality and opportunities for us. But I think also, as we've mentioned, you know, the Filo deposit is still open in all directions, and we see significant upside potential for the resource to grow, and that includes silver qualities and quantities. But of course, you can structure a deal where you're having step downs or, you know, arrangements where you, you know, don't have to run the stream in perpetuity. So we're looking at opportunities. But I would say it's still lower down on the probability list for us in terms of financing. And if there were to be one party, you know, working on a different form of financing than another, then the, you know, as part of the JV, the partners would have to get together and align on what that is. But right now, I think we're in a really good position as it pertains to our funding strategy.

Okay, great. Thanks, and congrats on a good stable year.

Thank you so much.

Our next question comes from Satish Kusinathan with Bank of America.

Yeah, hi, good morning. Thanks for taking my question. My first question is on the long-term outlook, a pre-outlook. So your 2028 guidance, which currently calls for a modest drop in copper production versus 2027, I guess there is upside from Sahuwa, which could start in the second half of 2028. Can you talk about some of the other opportunities you highlighted at the investor day, mainly the underground expansion at Candelaria and then the Angelica target at Casaronas?

Yeah, I can talk about the growth projects and I'll hand it over to Juan Andres to talk about the 2028 production guidance range. So for Candelaria Underground, as we mentioned on the call, right now the focus for us is to be insourcing the mine production operator in the underground. And in order to accommodate that smooth transition, we've lowered the throughput assumption from the underground and we'll be exiting 2026 getting back to kind of that 14,000 ton per day baseline production rate. Once we've been able to do that, then we'll look at putting a plan in place to potentially grow in increments up to what could be around 22,000 tons per day in the underground, which translates to around 10,000 tons of copper per annum for Candelaria overall. Angelica is a very exciting exploration play right beside Casaronis. We've got a number of exploration targets that we're following up on through our drilling season this year at Casaronis. And really what we're looking at is high impact holes that are near the existing infrastructure of Casaronis that could quickly translate into mineable inventory to potentially feed higher grade material to the sulfide concentrator or even more oxide material for our dump leach, which as we have been announcing and talking about the cathode plant is running exceptionally well due to upgrades that we've made to our overall kind of leaching plan. So yeah, we're going to be chasing up those opportunities in addition to the SAUVA project, which we just spoke about. And I'll hand it over to Juan Andres to talk about 2028.

Yeah, in our guidance in 2028, we have not yet included any of these opportunities yet. So as we move forward, we will be including those.

So I don't think there's... No, and SAUVA is not part of our... We haven't fully sanctioned it yet. We look to do that before the end of this year. I mean, the Chapada plant upgrade for the extra ball mill is, something that we will be proceeding on. And right now, the PFS outlined us getting into first production actually in 2029, not in 2028.

Okay, understood. Thanks for the color. Maybe one question on the Chapada stream. So Chapada currently has a stream on the primary metal production with the change in ownership there with the acquisition of Sandstorm. Have you had any initial talks with the new owners and whether you can potentially take advantage of the current strong gold price and convert it into a gold stream instead of a primary metal stream?

No, we haven't had any discussion since the change of ownership on that stream, but something that we'd obviously entertain potentially in the future.

Okay, thank you.

Our next question comes from Cody Hayden with Deutsche Bank.

Hi, good morning. You kind of touched on it already, but as we approach a potential sanctioning decision at the year, I was wondering if you could comment on how we should be thinking about the balance sheet and capital allocation. Is there any consideration on updating your policies? Are you sort of in a holding period until financing agreement is confirmed at Bakuna? And then second, I noticed the calculation of net debt has been updated to exclude lease liabilities. I was wondering if you could just explain a bit of the rationale behind this change. Thank you.

Yeah, I can address just on the capitalist leases. Most of those actually relate to the Casarone operations. But we just think it's a cleaner story. It's less confusing if you just segregate the actual external debt as debt when we talk about the net debt. the leases are, you know, financially, it has to be classified as debt, but they really relate to the operations of the Castrol mines. That's why we prefer to separate the two. And we are always very clear as to when we talk about net debt, that it excludes capitalized leases. So there's nothing more to it than that. We just feel it's a simpler way to communicate the position of a balance sheet.

Yeah. And with respect to kind of our capital allocation, I think we've, you know, been very consistent in our messaging. We will look to remain distributing capital to shareholders in absolute terms, around $220 million through dividends in our buyback policy. We've got growth opportunities that we're pursuing. And then we've got, you know, this upsizing of our revolving credit facility that we're on the cusp of finalizing. And so that puts us in a really good position, right? Being in a net cash position, we entered 2025 with a debt of around $1.3 billion. Thankfully, to the conclusion of the sales of our European assets and other transactions, we've been able to pay down our debt in addition to the strong cash flows being generated. So I think we're in a very strong position, which gives us the ability to maintain returns to shareholders, pursue our brownfield opportunities at our existing operations, and then go after the big growth opportunity with Vicuña. So we're in good shape. Great. Thanks, Dean. Appreciate it.

Our next question comes from Craig Hutchison with TD Cowan.

Hi, guys. Good morning. Most of my questions have been answered, but I just want to circle back on Suva. Just looking at the production profile, it seemed to me pretty accretive, particularly given the high goal grades in year one. But is there any possibility you give us some kind of sense in terms of what the NPV uplift would be from this project? It's just difficult to kind of understand just based on only having initial capital and some of the grades. But is this a pretty material uplift in terms of how you view the NPV for Tripada overall? Thanks.

Yeah, absolutely. It definitely impacts the overall value of Tripada, adds a significant amount of NPV to the asset. We use base case kind of consensus pricing for Tripada. the sanctioning decision and for our economic model. But if you were to use spot pricing, I mean, this would significantly enhance the overall value of Chapada. And so these are the exact type of projects that we're tasking our sites to go out and look to pursue, given that Chapada has, you know, stabilized the operation and is generating strong cash flows year over year. You know, I think SAUVA plays a key role to improving the overall value. And I will say as well, targeting before the end of this year. We're going to be updating the technical report, which will update the resource and reserve for Chapada. It will incorporate SAUVA as a reserve as well, and it will, you know, include kind of the development plan and overall strategy for making that part of the core of the operation.

Okay, great. I guess you can't give us some kind of sense of what that MPV uplift is at this point, or we have to wait until sort of year-end?

Yeah, we're not disclosing that at this time, but you'll be able to see it in the near term. Okay. Thanks, guys.

Our next question comes from Matt Green with Goldman Sachs.

Good morning, gents. Congrats on a great year. If I could just carry on that question on Salve, Juan Andres. What do you, I guess, firstly, just a clarification point, because I think the language is changing a bit here. At your CMD, you talk about incremental production, and now we're talking about offsetting low-grade materials. I just want to confirm that is still incremental production on top of what the mine plan you presented at the CMD? And then just kind of how you, since the scoping study in this PEA, has your approach to how you're thinking about this project changed at all? I mean, metal pricing has gone up. I guess, are you solving for NPV? Are you solving for capital intensity, the ability to bring this to market quickly? I'm just kind of keen to know if your approach towards this project has changed at all since you've seen this.

No. In general, the approach has not changed, Matt. We're still aiming for bringing production earlier in the life of mine of Chapada and taking advantage of the current commodity prices. So we're aiming for low intensity, low capital intensity opportunities as we highlighted during the CMD. And to your initial question, it is incremental production. So we're basically deferring or delaying low-grade material from Chapada and replacing that with higher-grade material from Chauva. And those 17,000 tons of copper are actually incremental over the previous life of mine of Chapada.

That's very good.

Thanks very much. Just to add one more comment, this is the first phase of this project, which is this near-term opportunity, but as we continue with the study of the project, the feasibility study, we'll also be working on the pre-feasibility study of the remaining of the ore body, which is still very attractive, but we need to understand more the deposit and how we're going to bring that project forward.

Yeah, got it. Thanks, that's clear. I guess just taking a step back on the concentrate markets, you touched on TCRCs earlier, but I don't think that really tells the whole story. Just given the tightness, not getting as penalized as much on impurities, free metals. I think your bargaining power as a concentrate producer right now is quite favorable. So is this, I guess, changing the way you're thinking about how you produce your concentrates across your mines? I mean, are you able to... lower the gradient concentrates, perhaps mine material, if you do have it, that has higher impurities and be quite opportunistic in this market. Is this something that is perhaps opening up a few opportunities?

Yes, we have been looking at opportunities from that regard. We are testing some different approaches in Chapada, for example, where we're making a trade-off between lowering the grade of the concentrate and increase our recovery significantly. So we are testing those opportunities. We have seen on the other side an incredible increase in the concentrate grade in Cacerones as we mine through an area of the deposit where recoveries are higher and concentrate grades are highest. It's basically driven by the metal lute, but those are the kind of trade-offs that we're testing now.

Okay, thanks. And is that looking quite promising? Is that at all reflected in your guidance, or could that be a little bit of upside, you think?

No, they're not yet totally reflected in our guidance.

Okay, got it. Thanks, James. Cheers.

That will conclude our question and answer session. This concludes today's conference call. Thank you for participating. You may now disconnect.