Torex Gold Resources Inc.

Thank you for standing by. This is the conference operator. Welcome to Torex Gold's fourth quarter and full year 2023 conference call and webcast. As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there'll be an opportunity to ask questions. To join the question queue, you may press star then 1 on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star and zero. I would now like to turn the conference over to Dan Rollins, Senior Vice President, Corporate Development and Investor Relations. Please go ahead.

Thank you, operator, and good morning, everyone. On behalf of the TORX team, welcome to our Q4 and full year 2023 conference call. Before we begin, I wish to inform listeners that a presentation accompanying today's conference call can be found under the investor section of our website at www.toraxgold.com. I would also like to note that certain statements to be made today by the management team may contain forward-looking information. As such, please refer to the detailed cautionary notes on page two of today's presentation, as well as those included in the Q4 2023 MD&A. On the call today, we have Jody Kazenko, President and CEO, Andrew Snowden, CFO, as well as Dave Stefanuto, Executive Vice President, Technical Services and Capital Projects. Following the presentation, Jody, Andrew, and Dave will be available for the question and answer period. This conference call is being webcast and will be available for replay on our website. Last night's press release and the company financial statements and MD&A are posted on our website and have been filed on CDAR. Please also note that all amounts mentioned in this call are U.S. dollars unless otherwise stated. I'll now turn the call over to Jody.

Thank you, Dan, and good morning to all on the line. I'll open my remarks today by speaking to how proud I am of both the operations and the project's teams at Morelos for another strong year of results. On the operating side of the business at ELG, we produced 454,000 ounces of gold, we delivered on our original production guidance for the fifth straight year and solidified our position as the largest gold producer in mexico in q4 we also achieved the second highest quarter of production in our history and this was driven by a number of new operational records which i'll speak to shortly alongside our operational results the media luna team continued to make significant progress the project was 60 complete at the end of the year with 84% of expenditures committed and 56% of expenditures incurred. We remain on schedule for first copper concentrate production by the end of this year. Dave will speak more to the project specifics, but with 21 months behind us and 12 months to go in the project period, we are very much tracking the schedule. In terms of capex for the project, procurement for equipment, materials, and services is tracking reasonably well to the feasibility study plan. That said, the strength of the Mexican peso remains a headwind to contend with, along with general inflationary pressures, and the teams continue to work hard to find offsets against these pressures. Andrew will speak to this subject in more detail shortly. Most importantly, from my perspective, we accomplished what we accomplished in 2023 safely, with no lost time injuries for the full year at ELG and none in the second half of the year at the MediLuna project. We continue to pride ourselves in being one of the safest operators in the industry, and I'm happy to say that in Q4, we surpassed 10 million hours worked without a lost time injury at the ELG operations for the third time since 2020, which is a pretty significant achievement and one that I'm personally very proud of. Beginning on slide four, this is our strategy. This should look familiar but a bit different to most of you. While our strategic pillars remain largely consistent with what you've seen for the last three years, Given the progress we've made on our plan, it was time to update the strategy to reflect some slight shifts in focus. I'll take you through this pretty quickly. First, the previous pillar of advance and de-risk medialuna is now squarely focused on getting medialuna done, delivering the project on schedule and on budget, and then ramping up the mine to full production of 7,500 tons per day. A number of key project risks that we were actively managing just a year ago are now in the rear view mirror. We broke through in the Y has tunnel in December and we've now obtained all permits for both the operational and development phases. From where we sit today, we're confident in our ability to deliver first production in Q4 24 commercial production in early 2025 and achieve steady state production within the three year ramp up we outlined in the technical report. Next, our teams are focusing on integrating the MediLuna project with our ELG operations to really get the site working inside the same systems. And from there, we'll optimize the entire Morelos property to have both sides of the river running at continuously improved performance in terms of productivity and costs, no different than what we do today at ELG operations. While our operations and project teams are hard at work, it's critical that we remain focused on disciplined growth and capital allocation. With $465 million of available liquidity at year end, we're pretty pleased to say that available liquidity now is greater than the remaining spend on the MediLuna project, which is $384 million left to spend. And that is before even considering the four quarters of strong cash flow we have coming to us from ELG operations this year. On the bottom left of the slide, you'll see grow reserves and resources. This isn't new. The two areas of near-term focus are drilling at ELG Underground, which has further increased our confidence to replace reserves and increase resources. And the second area is drilling on the south side of the Balsas River. It continues to highlight the potential for new mining areas such as EPO and MediLuna West. We're making good progress on completing an internal pre-feasibility study this year on EPO. to see how we can optimally fit this into our future life of mine plans as an additional source of feed for the mill. In the bottom center, you'll see retain and attract best industry talent as a new pillar. But this really isn't new to the TORX agenda. We can continue to see our talent and our culture as key strategic differentiators in terms of our ability to consistently deliver results, And finally, there on ESG excellence, we closed the year with a lost time injury frequency of 0.31 per million hours worked. And we continue to work our sustainability agenda such that risks in this category are responsibly managed. Turning to some highlights of our results on slide five. As you can see from this chart, Torex has firmly asserted itself as a consistent, reliable producer with average production over the past five years, of over 450 000 ounces production in 2023 was near the midpoint the full year guided range full year total cash costs and asic came in at the upper end of the revised guided ranges total cash costs at 866 dollars per ounce while asic was twelve hundred dollars per ounce While free cash flow was negative in the year as expected, company-wide we generated $181 million of positive cash flow for the full year. That's prior to spending $366 million on the MediLuna project. Really, that 181 is a testament to the cash generation capability of our Morelos asset. We exited the year with a very strong balance sheet, and Andrew will touch on that in more detail when he is up. On slide six, I wanted to point out that the strong production in Q4 was driven by a number of operational records that were broken for both the quarter and the year. While not shown specifically on these charts, in the ELG open pits, average tons per day mined for the quarter was 19,400. This set a new daily ore tons mined record and certainly contributed to the finished production results you see on the top left. On the top right, throughput rates in the processing plant remained above 13,000 tons per day for the fourth consecutive quarter. And so the team set a new annual throughput record of 13,178 tons per day. Bottom left, you can see the grades picked up as expected in Q4 following the completion of that low grade high strip phase of the open pit mine plan we saw through the middle of 2023. And finally on the bottom right, The momentum from ELG underground continued into the fourth quarter, with mining rates averaging 2,300 tons per day in Q4 and over 2,000 tons per day for the year. This is important for two reasons. First, it surpassed the previous annual record set in 2022. And second, it means that we achieved our targeted production rate one full year ahead of our schedule. Over now to slide seven on the topic of the 2024 outlook. This table captures the guidance we issued in mid-January. There are a couple of important takeaways. First, 2024 will be the first year we're also reporting on a gold-equivalent basis as we begin to see meaningful copper production in Q4 when MediLuna comes online. Second, production is forecast to be slightly lower this year than in 2023 as we're budgeting a one-month shutdown of the processing plant in Q4. This will allow for the necessary upgrades to be done to the processing plant as part of the MediaLuna project. This includes the tie-in for the copper and iron sulfide flotation circuits, the tie-in for the regrind mills and the water treatment plant, as well as the installation of variable speed drive on the ball mill. As a result of this lower production, total cash costs are expected to be modestly higher in 2024 than in 2023, reflecting both the one-month shutdown and the initial startup costs at MediaLuna. That said, all its sustaining costs are guided lower for 2024 than in 2023, as capitalized waste stripping is significantly lower now that we're through the high-strip phase at the open pits. We've also factored in considerations for the stronger PESO, and Andrew will provide specifics on that momentarily. Finally, we're very pleased that this will be the last year of significant investment at Medialuna, with a guided range of $350 to $400 million. We expect capital expenditures to decrease significantly in 2025 and a rapid return to positive free cash flow during 2025. Looking longer term on slide 8, the work we've done over the last few years to improve mining rates and plant efficiencies and add meaningful ounces to the mine plan continues to improve the long-term outlook. And you can see in this table how it's evolved. Two years ago, we were guiding 385 to 425,000 ounces for this year, for 2024. Now, guidance for this year is solidly above that and is averaging over 450,000 ounces of gold equivalent ounces per year through 2027. The benefit of the reserve additions we made in 2022 can be seen in the improved production profile in the year of 2028. which is now 10% higher than outlined in the 22 technical report. This reflects a deferral of lower grade stockpiles and replacing it with higher grade run of mine feed. We can expect to further improve on the production outlook by continuing to replace and grow ELG underground reserves and potentially bringing EPO into that life of mine plan I discussed. With that, I'll pass the call over to Andrew to walk us through the financial performance and balance sheet positioning.