Hycroft Mining Holding Corporation Q2 FY2021 earnings call

• Safety: Total reportable incidents frequency rate (TRIFR) decreased from 3.8 to 0.53 in July, well below industry average, with an 83% decrease over 12 months.
• Culture/Morale: Employee engagement survey showed transformed culture of teamwork, transparency, and focus on safety, with employees feeling valued.
• Production: Hycroft Mine met production targets for 30 consecutive quarters.
• Cost Reduction: Driven down costs in mining and processing, improved equipment efficiency/utilization, no write-downs of mineral inventory from leach pads.
• Technical Work: Variability drilling and met program underway, column tests on site, scoping analyses on processing methods, AAO mill feasibility study in progress, ROM plan development for 2022+, metallurgical drilling with 31 holes drilled (31,000 feet), identified robust targets like Hades, East Fault, etc.

In the second quarter of 2021, Hycroft Mining sold 17,060 gold ounces and 189,766 silver ounces, generating $36 million in revenue. The average realized gold price was $1,811 per ounce (5% higher than the same quarter last year), and the average realized silver price was $26.88 per ounce (62% higher than the same quarter last year). The net loss was $8.4 million. At the end of the second quarter, unrestricted cash was $30 million, a $26 million decrease from the start of the year. Year-to-date cash used in operations was $21 million, and cash used in investing activities was $9 million.

• Plan to continue using current fleet until technical work is completed, driving unit costs lower until mine plan and processing method are clear.
• Re-commission North Merrill-Crowe plant and phase in new refinery.
• Expect to remain comfortably above $10 million cash threshold into Q2 2022 to complete technical work and assess capital requirements.

• Uncertainties around finalizing mine plan and processing methods affecting capital needs.
• Compliance with debt covenants related to minimum cash balance.

Q: Discuss AAO process, existing grind capacity, prior work, permits A: Mike Eiselein noted AAO is a grind flotation circuit, existing milling equipment is on site (long lead items already there). Prior work was affected by gold price and capital, current $1,800+ gold makes it attractive. Permitting for process is mostly completed, including tails down, with previous Hycroft work aiding timesaving.

Q: Cash covenants and 2022 operations A: Stan Rideout said they have $10 million cash threshold covenants, focus on maximizing cash generation from ROM plan, driving down costs, confident in staying above threshold by continuing ROM operations and cost reductions Q: Year-to-date performance and back half of year A: Mike Eiselein mentioned pad management, high flows to pad, strong plant recovery, leveraging tricks like re-leaching to boost ounce profile