McEwen, Inc. Q3 FY2024 earnings call

• Exploration spending: $5.3 million at Fox and Gold Bar mines, $6.1 million at McEwen Copper Los Azules; viewed as strategic investments extending mine life.
• Safety: Gold Bar 54 months, Fox Complex 33 months, Los Azules 1.3 million man-hours without lost time accidents.
• Acquisitions: Completed acquisition of Timberline Resources in Nevada with properties near Gold Bar; starting to drill exploration targets. Bought position in Inventus Mining in Ontario with Paleoplacer Gold deposits.
• Los Azules progress: Raised $56 million privately, planning IPO after feasibility study and environmental permit; MOU with YPF for renewable energy, ongoing feasibility study work.

In the third quarter of 2024, McEwen Mining saw significant financial improvements. Revenue was up 36%, gross profit up 268%, adjusted EBITDA up 586%, and operating cash flow was $23 million compared to a negative $2.3 million in 2023. For segments: Gold Bar and Fox Complex had strong safety records (54 months and 33 months without lost time accidents respectively). McEwen Copper Los Azules had 1.3 million man-hours without a lost time accident. McEwen Copper raised $56 million privately in the last quarter to complete the bankable feasibility study for Los Azules, with revenue contribution from various segments based on their financial performance metrics.

• Los Azules: Feasibility study expected in first half 2025, IPO planned after feasibility study and environmental permit obtained.
• Gold Bar: Production in 2025 expected to be in line with 2024; aggressive stripping at Big Three to position for future.
• Timberline: Permitting in phases, earliest production projected around 2027, unitized under Gold Bar accounting.

• Lower grades at San Jose temporarily, but advised as temporary.
• Permitting challenges for Timberline, with BLM permitting expected to take longer.
• Production issues at Fox leading to higher costs due to lower production and unexpected stope failure.

Q: How much capital is the company planning to raise for Los Azules and details on the anticipated IPO?

A: Can't provide comments as premarketing and feasibility not complete.

Q: What studies have been completed at Los Azules for feasibility and plans for the Tango porphyry system?

A: Record-breaking drilling last season provided most data; remaining steps include site investigation, final mine design, etc. For Tango, plan to test mineralization by building to center of anomaly to confirm higher grade.

Q: Are higher production levels at Gold Bar expected to continue into 2025?

A: Production of gold in 2025 expected to be in line with 2024 due to stripping being a large part of current production.

Q: Permitting timeline for Timberline acquisition and potential production start?

A: Permitting in phases, earliest production around 2027.

Q: Development work at Fox and stope access?

A: Working on permit for ramp excavation and shaft rehabilitation, hoping parts of Stock operation to be in operation in Q3-Q4 2025.

Q: Post equity issuance, cash balance in Los Azules subsidiary?

A: North of $40 million.

Q: Accounting for Timberline acquisition at Gold Bar?

A: Unitized under Gold Bar accounting operationally and eventually.

Q: Lower grades at San Jose and Q4 performance?

A: Lower grades temporary, Q4 trending well, still on track to meet guidance.

Q: Why market not reflecting higher value of McEwen Mining?

A: Past underperformance leading to skepticism, but operations improving and copper project raising funds privately.

Q: Impact of Trump on gold price drop?

A: Perception of stronger dollar due to Trump's potential spending, affecting gold and silver prices.

Q: All-in sustained costs vs actuals at Gold Bar and Fox?

A: Higher costs due to aggressive stripping and lower production, but annual guidance still expected to be met.

Q: Monetizing Project Phoenix or San Jose mine?

A: At the right price, nothing concrete yet on San Jose sale.