Q2 2020 Compania de Minas Buenaventura SAA Earnings Call
Good day, ladies and gentlemen, welcome to the company had they mean that went into second quarter 2020 earnings conference call. At this time all participants are in a listen only mode and please note that this call is being recorded I would now like introduce your host for todays call Mr. Rodrigo at your Investor Relations Mr. chicken.
Maybe.
Thanks very much.
Good morning, everyone and thank you for gearing up to 80, Scott our second quarter 2020 results.
Today's discussion will be led by Mr. It'd be pretty long Beach shield.
Also joining our call today and the retail for your questions or some of them blotchy space junk Gypsy, let's get on Colombia.
The jumbo operations.
Yes, let's pick them up.
I like some of them also.
Lets pitching them they need to be.
Well, so they'd be person is broken even though he is our chairman.
This conference will include forward looking statements, which are subject to but yes leased.
Uncertainties that could go Oh, the source to differ materially from such statements in such a thing it's true because you can definitely cautionary statements within our evidence and we've talked to discussions.
I encourage you to eat well discuss your let's go through concerning but wouldn't get standards. It seems that person, we filed or did I say can play.
In addition, it's important to note that the sustained institute expectations, and assumptions, which really shirt related by golly banking.
A seamless like two or were they look at Sam. It's also provide well watch information on risk factors, including the track related to probably thinking that uptick our financial <unk> results in particular, there used to me because.
Uncertainty about the nation and complement the impact of the Cobiz 10 people.
This means when I look we sold it changed any time I'm not.
Oh got people on the company's business results and outlook you saw this estimate based on information that they do it.
Please note.
They say.
Yep.
Again, you'd be light you know more digital approach exercise its social usage.
Looking back at the school this quarter.
We would ask you to be degree that might like anything being something like a difficulties, which we told you.
At this time.
And let me now I'll turn the call although to be the boats. The complete go ahead.
Thank you all do you want me to all thank you called out then be <unk> conference call before.
Before we start to be they feel like we do you know cromie I'm playing.
I'm going to me I need you could well done.
Yep.
That was sold with water. So anything you probably yeah, I mean, not one or two.
But I wouldn't point, they would you be double what beach.
Before we go or that you pick up on that would mean, a cultural Mary thing and home.
Slide number.
<unk>, Yeah that is no problem. They did not go beat 19 Ondeck.
Yeah.
I mean, I like what I thought.
[laughter], while well yeah, so what I believe you talked to.
They all that much younger late Monday to knock down.
You did they didn't go on it what it become thing.
Well, that's all my life.
Why don't I when I do that.
Great one well may not be <unk>.
Hi, My you South.
Got it I'm going more that should be done Oh, we stop.
Field operations.
Oh, great be done or.
NAXI I'm not they Oh yeah.
That's cool.
They do a week who'd like to do all that but it sounds like Dino.
The second quarter that he'd be done well liked but it's on the black Friday on $5 million compared to 47.1.
The book that again.
Indeed second quarter that'd be helpful Diavik Corporation.
Wow.
So you do well yeah anything.
All night activation while.
You know more.
HM, Okay, Oh stayed up and ready to jump recovery.
No.
No we keep I haven't been building.
No.
Well my guess mine.
And do all the meat and bone.
Mhm border docket.
Mhm associate the company.
Okay.
80.
On 1 million.
But what I'm in a 37.9 million bought.
<unk>.
Oil Goodnight.
[laughter] worked any pickup.
Hey, what 11.6 million bar.
Hi, good 28.8 million, but that's what I'm thinking it anyway.
Nice double what it water, but no.
25 form 1 million Bora.
Net income Oh.
9.7 million bar sports and beating the nice thing.
Well in line you don't go up a ball.
No well, yeah, but you're not it's been relate it.
Okay.
Yeah, well not consolidate the date.
The company deepwater, making voting cooking building building, what I hope you about it we let them.
Programs for anything on Dot com fun, but my view.
Well I never would have gone Mike.
Well, we mentioned Oh reduction Mallinckrodt actual cost was a key component buckle.
It would only 10 million stuckey.
I do though.
[laughter] water, so I suppose it's rich.
The 100.
Mmm boats.
Well one could slide number four that's really no I believe but when we use that useful.
People.
On the logo when I do not neutral.
Well I would like.
The company like we've got lots of results Campbell.
It's like.
Well I see.
Yeah, we got I.
I didn't see modest this helps decided.
Mark you do they Oh, that's right. So you can appreciate.
Which way the Golden Monkey [laughter] operating results.
Okay.
Our range a mine according to say, which we thought that corporations.
Moving onto its nice serving financial highlights.
Well the other thing is we're not putting portal, what nine 7.8 Needham Botha cheat.
55, that's in lower Goodbody, something that's simple what it'll couldn't 19.
But you do see both solid gold fever.
Yeah, so how the yet what country than any.
Form 10% compared to our truck how we're putting back.
You know from our direct operations.
One other thing 10 watts.
And.
6.5, notebooks and complete one group.
$47.1 billion difficult work for the banking.
Oh I Corporation for the six month or anything.
Okay. Good 19.7 million dollar companies want to.
4.8 million dollar getting hurt.
Well the new banking.
You don't really know what I see a deep water what 80.
On one we Dunbar MACI.
Okay, and then go what somebody come through that cycle wonderful couldn't banking.
He did I agree not what affiliates will Oh, yeah, why why I'm going on.
One other thing one can be done below compared to.
Founded on for what I think PDH anyway.
Net loss do quite a while mine when you try to simpler.
Right.
On slide $9.7 million a year ago.
It's profitable yet and that's no what walk on that on 1 million bucks compared to a poor outcome or what do you.
We live in Boulder <unk> been right.
[laughter] living point 4 million, what else is optical works and thing.
Thank goodness 7.8 billion.
Great. Thank you.
Sorry.
It's mark when you got the football.
And 1.5, you didn't work out 41.
Do you want.
Maybe you can buy something about for about 29.
He's got so not look on Florida, and then why not do.
And.
And for 1 billion dollar compared to 40.
Sure.
I'm, sorry for 1000 meter noticeable from capital.
World putting them.
Oh, yes, but free cash flow what you got.
Mm 1.9 billion dollar compared to.
3.5 number but for.
Good night.
The markets like eight yet again, we consumed a couple of busy responding big.
I'm, not liking donlin golds or or four four meal corporations.
Moving onto slide nine thing you can see attributable production.
Oh, probably going to qualify that show me, that's within Florida anything well.
It depends on policies, which is 46, but no one about the reported.
Yes.
[laughter] anything bolt on going up your belt watch a wall.
We're excited about one called them out.
For the thing no.
Nothing to do anything that.
<unk>.
He explained.
Production Tumble my you I'm gonna coach.
We don't call. That's Jones for this quarter was 3.8 million ounces Detroit diesel price.
Yes. Thank you.
But on the trick World Goodnight.
In the protocol for anything.
We don't perhaps some was 5.8 you don't know.
59, but then don't worry about but try to supplement the Sunday night.
When you do <unk>, they've got excellent Calphalon tumble Mike.
[laughter] World then bring for called Symmetricom.
Well I couldn't.
Before I couldn't be compared to the second part of it anyway.
No that's an incredible year <unk> electronically.
16.9, California Oh.
42 doesn't know what about the same.
Thing like they were due to that shouldn't be too, but then I mean, that's one of <unk>.
Well, it's a truck on line.
That they Nick.
That's helpful. While leap on could eat telecom that they don't like on where it'll bring them.
75, no go, but it's something that's occurring water goodnight.
The first.
Then you bring.
But that's from Citi.
Born could be a metric Tom you can probably something then 1.3 thousand metric from been thinking.
Finally, our copper I think look up all that Joan.
For the year well.
Seven problem with it though.
We didn't pick on cost anything copper that we would go up on that show up 41.4, that's helpful probably from that becomes affinity and degree compared to happen to you.
Because that children, maybe explain I can report.
No actually took away.
The Lumpiness night living.
All the puts and calls for our divisions [laughter] Colombia.
1800 HM.
Cool.
Mainly due to lower gold ounces holds the PD.
All people to Sage.
And then what I spot.
Well.
1100 claims filed with the up at all.
Let's call it seems that Empire.
Hello.
She's been born from for Europe out, which is 40% higher you know.
Well, great one follow up on 219.
What else parametric down between 8% greater than I did have a for copper.
Try stuff on 252.
Well good luck or has it sounds acute then.
No.
But it sounds like deductible.
Finally, the kitchen sink Oh flight to say Wow.
I'm, calling from 765 forgot that make it down which is 20% lower than a year ago.
Moving on things like a good we got my life that you are making toward.
Oh, it's all of the company.
You are making proto gaining mining cost efficiency I, possibly offset lower platform outcome you can see what's holds [laughter] water.
[laughter] fight.
If you could start.
And then 84.4 million bucks of each other.
I didn't you and then the company continues brake pad.
Bottom line gun, what would be probably some high grade area.
One thing I focus on let's go back home and cost reduction because it will.
You got to more detail about exploration program independent.
These specific.
We won't do that like I said team. Once again, you don't see I was kept their vehicle whole no use for I'm not liking what do think that updated information regarding our platform Youre probably.
Well, it's nights what theme.
No I'm fully updated yeah, we up within one stop shop, how does your minimum level for each one of our probably.
We won't be that 90 scheme, we can run my life Beacon.
And I've been probably.
Blondie signed before routines.
Really because currently about 30% protein.
Probably not like night out right. He told up any political moneycard book, which is on the English.
Moving on to slide.
Yeah.
Each it probably does it continue this yet we all quite confident that team.
Well what line Brio lastly, excuse me.
Also by minimum impact I feel like you just stick there could be approved by the and then can you walk.
Moving on things like 17 that you'll stay cool throw you can put them.
We moved the arsenic content copper concentrate we shall see it's picked up the team is expected to be far you buy you, yes, they limit that.
Typically be approved.
Or anything one.
No.
Deeply we expect them to I look I think a gun value for our copper portfolio.
Well just like they do not been thought what by a two part Felipe.
That completes its with the ability.
Right, but I think than one.
The thing that older people, there's going to gotten into them have gotten back I've said many.
I'm also we out if you mentioned a they need basic engineering.
But you've got two components will be fully.
We got thank you probably eventual I wouldn't try and that cold boxes are very good to open the line. Okay. That's.
But april eat well [laughter].
Thank you we will now begin the question answer session. If you would like to ask your question. Please press Star then one on your Touchtone phone.
You are using a speakerphone please pick up your handset before pressing the keys if at any time you would like to withdraw your question. Please press Star then two.
Our first question, Dave will come from the I'll go ahead with Goldman Sachs. Please go ahead.
Hi, Thanks, I'm good morning, everyone.
So first of all because we like to thank you for all the sports club is pure wish you a bad luck and feature venture then also Leandro also best.
We should all day on the new position. My first question is regarding the cost it seems that several operations, we could reduce the cost in spite of the lower volumes that you can.
Explained what do you feel happening the next quarter you summed up costs you have any guidance I know that gets growth that you know yards you ramp you have to debt reduction, but any rough guidance here would support that.
And if you can provide also.
Ah any indication on 10 Bucks a capital allocation for Didier in next year I'm Capex would be great. Thank you.
Okay. Thank you so anything for your work Yeah, you got to me that falls or watch on go outside said.
Through that de Bottlenecking program, we will able do they used to make it doesnt need to fix cost.
But I phone calls, which lessens picked up the important.
BD, we'd be gain on nakedness eat it in terms of Dias yeah.
Oh, Yes me Oh were trying to explain by the end of August we finish beats Alliance, we got a lot in order to apply our new 20 body Thunder.
Basically using dot E.R. Bates, but she wanted to.
I've got food capacity of our operations, but I'm not broadly on catalysts, Oh themes I wouldn't.
C O or.
Some typically put much.
Okay.
Degrees or should we take a position.
Both.
As mentioned by because.
He has an advantage this quarter I see.
For the head.
Okay.
A new branches they kind of.
Let's see what Richard.
You can happen.
The nation or.
But the.
So that's where we tell you have.
But it's I'm going to be paid.
This is really the goals and really left out every quarter.
Got it.
And.
Okay.
Definitely leasehold.
The quality of deliveries.
So there are.
You know fish.
So you just have you can say you become quarter literally by December.
We try a specific quarterly which we have two and if you chose a wonderful.
I was reduction.
Got you presumably solutions he has a lot.
No they should lead the grade.
Hi, this is gonna be a sustainable operation.
Right.
You broke up.
Yes, I did my you go live nation shade are.
And then if it's exactly what you should be good for you you should have essentially what the other than what we should look like as you see evaluation we've been through people.
Hey, I see activity because when people car that we'd be pleased to develop an exploration and appraisal well it.
The fact that you can be.
I did see avoiding cost falls within the might anything for real before she was about.
Hey, Thank you won't got.
I feel I am I am really we call it or all your questions.
Yes. Unfortunately, the the South Korean won but not very good job or go pump up you can its plan I used to be sustainable and in a I understand there. We've got some personnel them. It seemed like there was some high grades right the change that.
It's been most afford to future quarters.
[noise] attempt here yeah.
I can't see any on your but Oh sorry.
You said regarding our beliefs regarding our topic.
No no sorry, if it's going to Orcopampa.
Addiction personnel that supported the cost reduction, but also it seems there was some high grading right. So I'd like they're saying how sustainable you know the because that you've presented on orcopampa.
But the nice quarter.
Okay, right, you'll put somebody for gobbling up a bump I yeah, yeah different can you eat you leave it used to pick up the our air sits in headcount.
We maintained our exploration exports on the we have found area.
Hi, great, Yeah, taking advantage of das and Wi.
Probably can also on kind of thought multi core mission, Brett, but according to our plan, we expect to maintain visit all the collateral.
Do you need to anything.
Called the old so anything you want.
And if he can they just cost level is also sustainable Ben.
No I think they say a we are trying to extend W.P.D.O. awful orcopampa by now yeah, yeah, we'd have more more information regarding these yet.
Yes, anything you want.
Obviously through these leases bush and told them that.
It's part of whole told me about these different there shouldn't be catchy that's the main thing or whatever for two and.
Life of mine Oh, Okay.
Okay, great. Thank you think or I guess.
No work on several.
In the next question will come from kind of fell in love with Morgan Stanley. Please go ahead.
Thank you very much Oh second gyro and Ah. Thank you you. They couldn't we should get good they'll get into New York into new opportunity and handle looking forward to continue working with you as we have done in the last few years. So my question is on the first one is Ah.
Yeah, if he'd like to the last two last question that I was asked but maybe more broadly how did you see the evolution of the mining.
Plan in the second half a year because my understanding is that.
As part of the Air Force for the second quarter, two sustained production when did a very deep.
How did you [noise].
Environment and to reduce costs the company high grade.
Some areas so to speak money is this something that will continue for the second half a year or as you reach full capacity at the end of August will the company come back or go back to their mining plan that he had put in place at the beginning of the year, if you could elaborate a little bit.
All the that would be very useful.
We also have questions Oh, yeah.
On their future I saw some gabriele.
It is progressing well.
When do you think that dish or.
This is the policy it could see first production.
And then I Wonder if you can also please give us an update or young back, which I didn't see a doing Dave.
The presentation and then finally on Yanacocha.
Yeah. It seems that decision now he's got to be made Oh until 2021.
No no more or less suggesting that they do they see a 2 billion.
Daughter investment to extend the a and b operation I'm not going out of the operation.
Can you comment to us as to when he 2021 do you expect to reach our decision on how you think that 2 billion dollar. Indeed, ER is what proceeds and how how's the finance you know that gurgling today. Please thank you very much.
Thank you for you or your watch you have to glean components. If you look what's shown that first party.
Moving on what operations and the second parties regarding our future I went through late in the in the first product in some sort of our mining plans for a second quarter.
Speaking, we were already coffee aims to improve our numbers because after these more than 100, not so easy.
Gain a lot of Stephens knowledge, and we as I said, we had improving our phones in order to minimize the.
In fact, I better screening Oh, I was little falls through de CPR.
See you soon.
So it definitely got our main concern a desktop.
How do booth, our tiny tiny possible.
Differently or B D sale mouth, and makes monkey, both will be able to improve since you've got to meet or beat so let's see.
I know, obviously or how to upset these are high grading mining plan, obviously, who I works Fotis imports and that's probably some pull it off for a deep underground mines Orcopampa humbled by you.
Talk what he's happy component of the second we probably find back on track for me. So even if you vote like what.
That is probably seen that's up to two entities or what activities in these specific topics.
[noise] probably at the end weekend, we got a helpful. I'll handle the gun, it's playing with more became so that it seems you're kind of knowledge that we touched on it and gain dealing with d., so what I'm not writers, but ER I score.
Although tool for our own talk about some property in.
Jim Buck I get Anacortes outreach.
Oh please.
Hello, everybody yeah.
HM Okay Sunbelt region mm.
Mm Hmm.
Your next year, depending on now probably will come from beach, that's something that the government.
When you hope there but.
Uhhuh.
Yeah done and she'd be ERM when construction now do you think Oh, yes.
Yeah I'm fine.
Sorry.
Thank you one you have new construction and a broader you start be on.
The production.
It doesn't he brings out when you do part D.
Incorporated.
We were all good news <unk> you can check walk in the meantime need a rough come from impact in a remote partner Hum, we know wouldn't liberal Oh.
Yeah.
Ah, yes mm mm 300 million a quota yes, no newborn or are you working on so for projects in the future you made by next year.
Sorry, yes, <unk> well I happened to all be quick to cover.
Oh, Yes, just one question on on Yanacocha <unk>.
But if the plan goes ahead and he said 2 billion dollar investment.
How would the fine if he knows the financing of that probably you take place a presumably Andrew how does that will be gone at again it was yanacocha resources.
But I I I'm not sure that but he has the balance sheet and certainly not the cash balance to to finance. The cool 2 billion. So it's pretty good it'd be a [laughter] possibility.
They should hold are still gonna quota I required to inject cap because due to the integrated into the project.
Ladies and subsidiary.
No problem.
Not these companies did and that you can imagine.
Essentially.
No it's either so.
Hmm.
You do.
But now we have nothing to report.
Yes, thank you very much.
But generally speaking you have gosh getting a culture is nothing cash won one beat on buckets, one calls on $1 million.
And on and that makes 2 billion dollar caught up beautiful falls almost three years Troy, It's I'm open discussion or you're sort of you don't mind, probably I'm thinking the subjects, which isn't a so you've got an important right now I can do it most of this plane with more details about the Tommy Friday.
And that's how we talked in place and fine tune in order to actual our coming up comedy clubs.
Okay, Yeah. Thank you Victor.
Yes.
Dimension.
We have to affect us mining sector, we've had to adopt the higher standards. They hire somebody started standards across all industries and they do from when I went through it in particular whats I challenge, having all these three print operations across our country. So it has to be learning process.
From the beginning when we started by maintaining care and maintenance when the operations and we were able to put in place have specific protocol to save all of our workforce before going on board to our minds on the first stage, we rely heavily on the use of Ah several logic.
<unk> or rapid test.
Hello.
Outline on sequence to try to gain I had the most security into.
Well you have these people are with the.
A copy of my team go into our operations no as long as the a and then you grow compare to we'd have to be maybe we'd have to review our protocols and also how do the fact that now yeah. The a use of what they are called the P C or there might look like they are.
Bail about now because you have to understand they do they were not available.
Now we have also included the molecular test for all the work it before they go on board.
Once we have every work are now that's to me that do we have been.
Hi, good who are pretty issues also we have to review with which we have learned which group of workers are more suitable to be protected we have to specific treatment for different sectors for workers. We definitely are arranged the idea that that's for six or themselves.
Jim work, we have been I breathing form of our books he wants to have more dynamic.
Hi, Ross, it's all incorporated people return operation, we have had some delays how do people going onboard because it's been typically the time that be too.
Through.
Everybody. We have finally, just went up we have would happen that arrangement with that I find the Portland lobby produce which is also going I gave us a lot of backup.
Having all all of our workers states that on a faster way than we had before.
Thank you.
Thank you Alex.
Great.
And the next question will come from Leopoldo still though with her you'd be out. Please go ahead.
Hi, guys.
A me too due to the the words from the.
Yeah, well I'm kind of listen thank you Victoria.
We feel best of luck I pulled down there too.
So much my first question.
Regarding reserves another prices are up.
With difference from the years before.
Could you please speak.
Somewhat above the.
The resources that could become a reserves I.
I mean, the part that we are not able to see yet.
Could you explain if those resources doesn't become reserves are become reserves until they are margins zero for the new price as well.
Evaluation or they all of them become a have at least for.
For example, $100 per ounce margin.
That that would be number one.
I'm also.
Could you perhaps.
I didn't give some color on the amount of in some of my Youre go bump on the side. Those are the mines that are running out of reserves. How much is there right on the border to to come in to the two reserves, if a higher grade or a higher price. So.
To evolve to evaluate reserves could come in.
That's my first question Oh are both another one oh afterwards.
Yes.
Your body of Orbcomm and then he takes to summarize your your two quick somewhere out related to already pets are normally total sits on the impact Oh, well the lump them metal prices Uh huh.
It's gotten indicates a couple of my Youre not political Pompeii, Buffalo Ah I know I'm kind of see good day.
Beat explained.
Okay differently queued up de bottlenecking going on we have to reduce the cost and a couple of it is that pedal.
We have to analyze the if we could that change lumping price.
But or kind of probably it's better to explain that deferred into that program double my view, but he couldn't say, yes dipping in a deep as part of my often tell rounding tambomayo defendants 80, s. anymore, but I'm not worried about Nixon's adss affiliation with pickup truck.
Oh sure.
Sure So you're sort of course real do.
First of all we use always blown through prices for the future locally sourced on reserves so ladies bolt.
Increasing prices like copper gold or silver usually doesn't happen, but in the shorten the evaluation North Korea Malone theory of original the reserves, we have signed that they'd be or not.
Because you know reserve baby and go to zero, so probably by the end of easier we will review our members, which prices when will it used to the low delicate each month.
Do they took them who they were worried that we have you would be similar to more [noise].
<unk> brought him.
We already we've got you could go see ratio for the.
Okay got it okay.
So each month, what perhaps you know there is so which is kinda Coleman homes are sort of every between Republican goals do for bond buying doubled my view Gelclair, that's already been busy because you're going to last year.
Your reserve, who isn't just a major.
The new work that there'd be for externally to park will be ready mm.
Well my your might be focusing now in devoted part of the mine. They I keep going down. So we are now not hopefully in the exploration at the border partly mine, where we are finding the extension of that normally rate.
We are writing down to reach that various alone we do.
Thank you.
Really something I'd be bought them you to is the same or you do see structured so we keep going down the I remind you probably likely because really we have some fraction of the new exploration results you could already be do I want to were so what is going to be simplicity merger disabled for all of the mine life.
The local bump up the exploration, who said go to the north and south as part of no.
We agree operation I, mostly to Chuck where might we are receiving the now it's going to HM or do you believe me we can be.
There are signs of the mine because a couple of months that these are even around that.
Chuck what Andy do impact what religion, so we're pretty level.
The third site of truck one I'm going to feed the got the Jaguar and do not believe it's going to that will.
Hope is easier I'm, probably this year and.
Part of something like operator would you really need to check what processing plant.
So these two branches, we had visited equally religion and the prices for all you'd ideally the view as it would be the review is the loves the scenarios of the crazy.
Religions, we really look like that's where you could even though I talked about nuclear or.
End of easier.
Okay.
Correct me, if I'm wrong, but I knew that you used the I've read of the last three years four though.
And metals prices in your reserves is it correct.
Sorry, I couldn't hear your your question could you could be good yeah.
Sure I am under my understanding a window into that uses the average of the last three years of prices to evaluate reserves.
It's a correct that for.
That's correct, yes, okay.
Okay.
So my second question is.
Sorry, then TV or so.
Regarding or could bump on some of my you and the reduction reserves.
You had said during the year that some of that came as a because of centralization of the mine right. So I I'm I'm kind of confused.
So what what was the close on what was the consequences decentralization of their minds.
Or the notes finding ore reserves what yeah.
Provoked the other one.
All right now there.
That's correct. Okay. Well go ahead go up it looks like.
Yeah. They eat the case is a piece of stumble my you. We've had some showed a reduction in the operating goals.
We will be aberrational hundred on $60 per phone process and now we know how critical experts I'm, sorry to be submitted and cost reduction and of course overly material over here or there wasn't.
We think it deal alert.
That was already margin alone has now become economic alone so does that increment.
Do they always serves a sequel and guess.
Well resources do Sir you guys by reducing the breaking calls.
It's going to its also new or really into the so it's kind of course there.
Oh, the $200 and value for them.
Sure so.
The two I worked and finally mm mm.
You could bump up we've got really using the goals. We have got you would be responses.
That's probably because when people are high and you were getting back to you I worked closely Patsy and.
And with a prudent when we sell so the last quarter when it happens issue do it and now.
Food that we would like most people who do believe taste of the operation So the coast when when you back.
I mean, how many dollars.
The time went up I want that to use them, they're coming back to around $300 well.
Turning to both B note that number and I do you will need more or go to <unk>.
Research.
By these cost reduction.
Oh, Okay book.
Okay, but I'm on the left on.
Going for the recent was.
Police station so what's the consequence or the recent for the for the reduction or for the increasing price.
Okay, well do you don't see should do we have a substantial showed a reduction in headcount. So we did do assume the citizens billions of people that you.
Reduce it even our operation so that.
You see charged to the caused temporary basis no one shot.
<unk> expense that we would do group to review the.
Remember people would be liberty too and that's what.
Part of the CW stations. So there's no you have a higher efficiency used if it's gone.
Before the severance payments or four Oh, I mean that Israeli time, you could we talk now we're coming back when there were stable now what else.
Do they found that people would you mind now where they really Bluetooth, whereas I think there's a liquidity to reduce sit down and.
Fewer number of location underground so highly could be.
Good day between your winter or the government it must be.
You know where cost so to the bookings are producing goes deeper and reviewed its expenses like so much they lose and do you just got Oh.
Just I do remember is they will cost I'm worsening of production.
HM Okay.
And just something very quick.
'cause the concept when you reduced your cut afraid that youre evaluating your Youre your reserves should your should Youre, a great come down because as you are reducing your cost Youre. Then you are like putting less.
Patient or into your research and and isn't necessarily that are less efficient or.
Yes.
With less grade or just and maybe it's just because it's it's far away or dip down.
Yeah, if as you say you know we review the condo in My example.
So how did a $50 down $200 during cooperative or is that the range to Georgia. So you kind of what we thought reserve I will I wouldn't say to that took an average of $200 now you live.
Overall $200 plus the fracturing that you out couple hundred 250. So do you ever is it's a little lower but we didn't see they don't look for Julie.
The you're getting good for the most those into your reserve and each one of these are doing pretty much smaller than the older but do you need design Nucor the operation.
[noise], Okay. Good guys. Thanks, very much very clear.
You're welcome.
Okay.
Your next question will come from Tanya Jakusconek with Scotiabank. Please go ahead.
Good morning, everyone can you hear me.
Yes.
Okay. That's fair I just wanted to congratulate you and wish you. Good luck Cam and your new role and it'll be masks and Leandro congratulations on your your old flex working with you.
So I have a couple of questions. If I could the first one I wanted to talk about it on your comp.
And it's your cost of sale.
I'm trying to understand how your cost of sales declined quite substantially I'm $66 million down from usually are like in that 165 to two all 5 million.
The quite the fact that you had you know.
You know 50 to 75 cents year over year, you've had a lot of volume down and then your cost went down.
I'm just trying to understand what isn't there how by now.
Thanks.
Ah think get Tanya pardon me Yeah, No wonder if you could think explained but that concept.
That reduction at home.
Problematic.
Because of all the low down as you know maniacally abrasion juniors were talking.
[noise] goes into production, so only goes adhesion and like goes.
We have during that period, especially older maintains and geared goes but normally you are they signed me when you come production to be production indeed.
A bowl desperate times all that goes is registered know in I found an expense in others. So.
We accomplished this volume, but old eating extra expenses.
They register.
Outside the cost of sales in the in got golf balls ours in in order for brazing given some other operating expenses.
For these period.
Okay.
These loans down a we have around 20 $26 million regarding that type of goes into account 13 coming from okay. I'm 13 point by our own third being bikes that come in Colombian operations that were not into that.
Yes so.
26 million.
You know well below that 165 to two all five.
I am.
[noise], yeah, but remember that that.
We didn't have Odeon.
They weren't getting old Unfortunately.
<unk>.
<unk> expenses normally we know.
Operation sorry.
It is a normal startup.
Yes, let me say Oh, it was all got close to where they sit there was a colleague banking.
No that cost related to let's say in maintenance of all our minds are not included in.
Indeed this summer.
No I understand that like I understand that that 26 million gets added back.
Okay.
That is well below the one five to five despite that.
So I'm just wondering what.
How about contractor so maybe that's also a car.
Well, maybe not included an hour cut out or eliminated or maybe your workforce is not coming back at the same number of people I'm not sure what I can.
Oh, yes.
I'm, sorry, I work.
Okay.
Sorry, I will work booked is not done under personally.
You know where you need.
We were.
I mean this deal we were north of 100% working that.
Yeah, Let me say other works eating he intends to 100.
Both already already started but then they start what he thought of our federal.
Does that take on Oh component.
70%.
It's a it's part of the on characters.
Sourcing C C and D. Despite that we will be able to where it used to meet you can see right beauty care and maintenance fees.
[noise], Okay, maybe I'll just move on to just thoughts on your.
Your reserve.
New life of mine plan did I understand correctly that you know well have obviously knew there your friends when you usually report chest pain.
So next year works in life of mine.
Related to these new reserves.
It just doesn't quite a bit of change and these operations I'm just wondering.
Plants that you'll be able to share with us.
Yeah.
Got it looks like you know if you could or would like to glasses that though.
Mm Hmm.
Yes, well, we're there yet we're working on that right now we're looking at opportunities, though we have particularly in the open IX.
Oh, we have from bode very low grade around.
Good we serve shareholders or <unk>.
No. The design right now we're looking for not only for the other let me give all the woke up real quick.
But those who for all the humidity infrastructure to support that we serve it say they are way down.
But remember the reach about.
It's cigarettes, so the country, though we are looking after the country that for you. The we need to kind of who we like to have all the major them the right to both.
So I view look into your money, we are looking at this opportunity, particularly well.
Great good proliferation.
With that we see very kind of opportunity could increase on the no area on the new could be originally to basically some price.
Okay.
I just one last question I'm trying to get an idea on your capital allocation.
So my understanding is.
You know cash flow that's generated obviously you have some that goes into your business. So your sustaining capital and expiration. So that you can you know.
Reserves or maintain or is there.
Maybe you can talk about how you allocate any additional capital beyond that dividends, obviously, a one but you know maybe you know what's it going to take to get an it never done back again is that profitability and then number two on your development capital maybe you can give us some you know site.
How you're going to allocate between dividend development another opportunities.
Yeah. Thank you Tony I lived blame explaining a very broadly perspective, I'm, probably another quick explain or so, but we must be things in terms of capital allocation differently. When we have it's Jim.
Capacity and according to Moodys metal price environment would really getting at eight dental or a free cash flow from operations more than 100 on $60 million, but could be a already.
A couple of policy shown in order to maintain our sustaining capex, obviously also realistic.
Our positive outcome coming from sort of out of it the keysafe expects also in terms of mediums.
Obviously, we have run a nice how to prioritize I would probably.
Obviously, the more about probably see somebody would have to analyze how can be.
Why not a these probably and the second one that could be a significant number because they're not purchasing price.
Well, obviously, it's an open discussion I definitely got ultra we are working voted to extend the life of mine our minds and also we had a blended that's actually see our total debt.
Indefinitely, that's green able to cool.
We all these Ah Ah.
[laughter] piece in the future.
Then it'll probably you put up more multi thing but that's.
Yes, Thank you Mr. and as you know then it is one of the first and most important objective of speech. This year was to preserve the gosh. They does anything though the order a year.
But were revising it overall were syndicated Vic.
Yes in April the cycle.
Oh go that objectives, so a little bit gosh.
Well for service for US are bullish for all work being done, though our various development of our budget.
Our where it's been great Yeah were exploration in our minds is a new coming probably would have opinions you know advisor.
In.
Oh, you mean the agreements that we can proceed from both our affiliate.
Also gone into a deep [noise].
Four O four hour organic development bribery and.
On a go.
You know what was the one of or the.
The decision we made between two to God.
Leaving school for easier to suspend sorry.
It is too.
Two easier to our shareholders in order also due to preserve because for all the geysers. They view us a buck the best for both redevelopment or or were they in organic as an hour.
History shows in our lives.
Okay. So with this suspension of the dividend what will it takes a year to reinstate that dividend is it that all of your mind go back to operating like that you are forecasting at the end of.
And then we are going to be profitable.
The enough to reinstate or what what's unique we anticipate that David.
Hello, This is a temporary suspension.
And.
We expect to reach funding for some production.
Yes, they are staying embraces the big though.
And improvements you know working.
Sure.
And improvement in our original so we are we will.
Really.
And they used to pay to all shareholders in the following once a or whatever it is difficult provisional.
Finish.
Okay. Okay. Thank you very much factor.
Yeah.
Thank you good friends that.
That concludes the question answer portion of today's conference call I'd like to turn it back of which Mr. Govies for any closing remarks.
Thank you I'd have to find out of thing then there's one related to the company and stuff like only more efforts on our long.
As a company after more than 100 on Saturday dealing we divide it up again seem to be kind of knowledge and b malls, we intend to harvest.
Meant that an alliance, we got fired lab water to use easy optics.
Both to really mice bodies that impact yeah, I was workforce.
Seem operation at 100% 11.
Original program.
Getting yanked it for the word on fourth quarter.
I will allow us to offset our implemented I, great mining times four for anything.
Well I need people don't Nicky program implemented how philosophy that unit production costs. If you can he spoke component, which watson becomes irrelevant.
That is both knockdown.
And the fall in that sense, yeah country, and that was saying that if he got slow that'd be enough that you expressed intent of using our total debt and extending its maturity.
Shifting that development of our drilling and balance sheet probably.
Yes, and keeping our long term business plan, although these pandemic vaccine and by 2020, we expect a worldwide perspective, that's a buck scene for Colby 19 will be pretty light.
And finally, I'd say, it's a more aslakson assignments or after almost.
Full year, almost four years, leading the company I have decided to sit down.
Let's see I know it because you're not a challenge however, before leaving the company, let me recognized the boats support.
It really bad or our chairman Mr. brokering the lease.
Got it really explain to me that purpose and they got a winner intuitive.
Also let me recognized that the war whenever into this might not to me and whatnot, but not least allow we also recognize that discipline a commitment of all our workforce on site.
Without then we will not be able to end either positive outcomes.
Regarding but I do not come in New York Nanobots, yet, our new CEO weed out we conduct the company why could lead on the Iraqi addiction, all debates for you down there.
Let me now in terms of color to meet their hoping that he is our chairman.
Thank you Victoria.
This is a very special occasion.
And as many of you present in this conference call no I have not been participating actively speaking in the conference calls because it was in maybe the responsibility of management that is this very peculiar.
Okay Jim.
Yeah, we'd like to thank you all four yeah work that are.
Doing in a imaginative when I do that builds a view that probably be competitive and I shared with you that we have a commitment so as our shareholders. We do believe in our responsibility. Please go away or investors and ER.
We want to continue working as hard that moves that have been doing with the leadership of Oh beat that we expect.
Having passed hopefully with a.
Crisis, there would be probably 19, then we will be back into our guidance and our.
Production normal production and even to increase that production with our project and when we talk about <unk> of our focus it yeah something.
The important developments access I find that would be that or is.
Very very important for us.
You have to very nice, but we have created that you wouldn't have improved and that the six seven years <unk> Jude.
Yeah.
We continue.
[laughter].
It means that the work where these cars every single day, let me assure you that exists and get them.
Someday, we had been into every single day at 730 remotely to follow.
Events of or the health of our before and if I go in there what we could do in terms of operations tend to be going on there, but they do and made the mistake go well, obviously in the operations and that that had a negative impact in Ah.
Our statement that we believe that you're going to overcome that.
I just wanted to finish by thinking a bit to replace that section.
We Oh, we spoke when we hire.
Going to finish your salary everything that they do that he has decided to take all the responsibility and its starting off and we.
Decided that he makes it very well Oh theme for this funding for a antamina and other before they do so thank you we feel for that and Ah, yes to share with you that we have absolute computed in Leandro He is EUR nine that.
Yes, many years for them every day that notes the operations. He is a very well swaying is.
Sounds really my financial background, but.
With that listener.
And who you wouldn't be TV support of all the he didn't technical two oh, well over and I do that he will concentrate on a on our operations I'm sure that he would do a great job and that's a record seen in support certainly be bought or.
We've committed to support the you were sort of Oh, Leandro and I'm sure that really talks are going to be very positive. So.
Thank you know younger than buying they they want them to do the job, but are you know the companies and I'm sure that or you would do very well with that I would like Leandro to give us a few words.
The market to the company.
We both one that thank you.
Well. Thank you. Thank you again, though.
First of all Larry I am the owner of combos that there will a closer look good reducing C store.
When I do this yield.
Hello window into their 67 years, he's very examples in some cases Thunderbird excellent I wouldn't want diversity to be long leaves a strong foundation.
Were very.
Okay colder shouldn't expect continuing to be a goes in prison growing for work continues but we know we're going into operations are where the excitement buys I look forward. It lowers our perspective or were great. Today doesn't finally I'd be lived up to create a combination of our portfolio I guess.
Theory or something because my understanding.
Hey, Reinsuring a bright future ahead. Thank you. Thank you very much.
Excellent thanks, everyone.
Well.
Okay Yeah.
Yeah.
Yeah, We got we're finishing our conference call. Thank you too old for attending these me.
Uh Huh wonderful like today.
Ladies and gentlemen.
This concludes todays whenever trust second quarter 2020 results conference call, we would like to thank you again for your participation and you may now disconnect.
Yeah.