Q3 2020 SSR Mining Inc Earnings Call

[music].

Good afternoon, everyone and welcome to assess our mining third quarter 2020 conference call. This call is being recorded.

At this time.

I would like to turn the call over for opening remarks, and introductions I'd like to turn the call over to Michael Mcdonald Investor Relations for EPS, which are mining. Please go ahead.

Thank you operator.

Good afternoon, ladies and gentlemen, welcome to assess our buy needs third quarter 2020 conference call.

Call during which we'll provide an update on our business and a review of our financial performance.

Our financial statements and management's discussion and analysis have been filed on SEDAR Edgar the assets and are also available on our website.

To accompany our call there's an online webcast.

And you will find the information to access the webcast in our news release relating to this call. Please.

Please note that all figures discussed during the call are in us dollars unless otherwise indicated.

All references to cash costs and all in sustaining costs are per payable ounce of metal sold.

We will be making forward looking state.

Eight minutes today. So please read the disclosures in the relevant documents joining.

Joining us on the call. This morning are rod and tall, President and CEO, Greg Martin, our CFO and Stewart Beckman COO.

Now I would like to turn the call over to Rod for opening remarks.

Thanks, Mark and good afternoon, all I'm very pleased to welcome you to our first quarterly call. Following the completion of the merger with Alaska Today, we were discussing our third quarter 2020 operating and financial results.

It's so good to finally be talking about the new warehouses.

Privileged to be leading the company into its next chapter.

And having the opportunity to work with an exceptional team.

Building from our larger and fundamentally strong business, we have an exciting opportunity to firmly establish SSR as the premier mid tier gold producer for the long term.

Got journey is just beginning and I fully expect that our portfolio will deliver a number of attractive drug options in the future.

The third quarter was an eventful one for US is a current navigating the global impact the COVID-19 paying Debbie close.

Closing the zero premium merger with a less.

Gold and ramping out by CB and tuna back to full capacity post the car that shutdowns.

Post merger, we have a very strong and diversified asset base across four operating jurisdictions.

In 2020, we will produce between.

290, 760000 ounces of gold equivalent.

After allowing for the impacts of carbon.

We have I got right now for me an ounce of gold equivalent reserves, which puts our weighted average mine life in excess of 10 years with Turkey, providing longevity.

Do you have around 20 years.

We are in a p., leading position due to our asset quality and low capital intensity growth going forward.

We have a clear focus on free cash flow that will influence every major decision we might.

Finally is free cash flow generation.

Generation going to.

Strong, but our starting point on the balance sheet is excellent with over $770 million the consolidated cash.

Our exploration portfolio as is his extensive.

We have a number of organic growth options in the portfolio with over 20 knee mine and Standalone expert.

Mutation opportunities currently active.

Over the next few months, we have a number of value enhancing catalyst plant.

The first will be the upcoming trip a technical report, which will provide a brief first view of the sulfide operations and demonstrate a long GVT too.

[noise] oxide gold productions, a chip or.

In addition, we plan on providing a number of portfolio wide exploration updates on our greenfield and brownfield initiatives before yearend.

The last point to Mike He's ever integration efforts are on track and largely completed.

We're fortunate that there was a close cultural alignment that has helped streamline the combination.

Our team has done a tremendous job in a challenging time to bring the business together and I want to recognize them for their efforts that have gone above and beyond our normal high expectations.

With 2020 draws to a close we are firmly focused on delivering safe production and driving to a strong finish for the year.

Turning to the next slide.

He is GE has always been ingrained in the culture of but it's just ER and Alaska.

Kelly.

Going forward, we can leverage the enhanced strength as a combined team to continue to do the right things and be recognized as a true partner to our employees and the communities where we operate.

We have several different programs across all our operating sorry.

There are too many programs the called out today that will with luck.

To highlight too.

The first is the continued investing in their local communities through established social development funds, where we are building capability and establishing sustainable businesses that are not depended on the market.

And second.

The t. vesting in schools and academic scholarships with.

Of particular focus on encouraging local and female representation.

From an environmental perspective, we hold ourselves in high regard.

And to a high standard we have many examples of best practice like being the first man in the world to be certified under the saw.

On on management code at Marigold.

We are proud of our achievements and will continue to be a leader in our approach to its Jay.

Moving onto the next slide.

With respect to kind of that 19, we have focused on the protection of employees in the local communities in which we operate.

Alright.

I see and tuna, we're broadly shut down for a period, while marigold and shoved law have been successful in navigating through kind of it though we had to adjust our operating plans along the way as circumstances dictate it.

All our operations continued to work with national and local authorities.

In accordance with applicable regulations and remain vigilant with respect to onsite activities.

We have implemented numerous mitigation measures such as testing quarantining, ensuring physical distancing and providing additional protective equipment.

We are operating.

Corporate offices, and a reduced capacity with all employees were working remotely.

Moving on to slide number six.

Few quarterly highlights before diving into the details.

Operationally, we had a solid third quarter and are on track to meet our updated 2020 production annual.

All in sustaining guidance on the back of what is shaping up to be a strong fourth quarter goal.

Gold equivalent production from all operations for the first nine months in 492000 ounces with a 164000 ounces produced in the third quarter.

Our quarter three oil interests.

Mining costs was a thousand and $34 per ounce.

Similar Marigold continued to operate reliably with tuna in CV now back to steady state.

On the growth front, we are busy on a number of fronts from continuing exploration drilling at a number of targets to.

To pharma to finalizing the chip for district Technical report.

From a financial perspective, we ended the quarter in excellent position, we consolidated net cash of $315 million and anticipate a strong fourth quarter with robust free cash flow to the end of the year.

Moving on to slide seven.

I'm delighted to announce a corporate dividend policy beginning in quarter one 2021.

We have been very thoughtful on air in our approach to capital allocation.

Our capital allocation strategy going forward is to balance the continued investment in high.

Growth, while maintaining pay leading financial strength and providing sustainable capital returns to our shareholders.

While our recurring quarterly dividend is expected to be the primary method of capital return we.

We will periodically evaluate supplementing these dividends from excess trailing free cash flow.

With that I'll turn the call over to Greg, who will discuss our financial performance in more detail.

Thanks, Rod and good afternoon to everyone.

This is definitely an exciting time for SSR hi.

I joined when we were a company with a single asset in Argentina and to go forward position.

In addition to the top end of the mid tiers with four strong assets and one of the best balance sheets and that business is a great opportunity.

Overall, I'm quite pleased with our third quarter EPS.

Even though CDN tune operations were interrupted for part of the quarter, they contributed well with Marigold solid.

And chip, they're coming in strong over the quarter.

As you will have noted from our statements we only recognize the operating and financial results for chip blare within our consolidated statements for the two week period Post September 16th transaction close date.

Within that context revenues totaled $225 million with income from mine operations totaling $83 million.

Attributable net earnings totaled $27 million or 19 cents per share.

Each of these financial metrics.

<unk> increases relative to the comparative quarter.

I will talk about a number of factors related to the transaction that impacted our quarter shortly but adjusted net income of $68 million or 49 cents per share is an impressive start for the merged company with all four hours.

It's contributing to that result.

Cash from operating activities was $44 million with notable items being catch up cash tax payments as COVID-19ien related tax deferrals expired.

Working capital build up as tuna resumed concentrate.

Sales and the settlement of payables and accruals acquired through the Elas are transaction.

Like many of our peers one of the principal impacts of co bid has been the necessity to defer cap.

Capital projects to reduce risk of contractors interacting with our operating staff.

Well that situation has somewhat normalized it will push some capital spend into 2021.

Publishing these first quarterly statements and the new assets are really highlights one of the features of the merger.

An exceptionally strong liquidity position to drive our strategy.

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Consolidated cash totaled $773 million with net working capital over $1 billion.

We have a strong net cash position and well structured low cost debt. So the balance sheet is in great shape and will get better.

So let me brief.

Briefly discuss the financial statement impacts of the merger.

The most apparent is the transaction and integration costs, we incurred in the third quarter of $15.7 million.

This accounts for the majority of costs, we expect to incur with the exception of certain limited integration cost.

Costs it will carry forward through the next couple of quarters.

The merger is accounted for as an acquisition of the last served by SSR.

As a result, we recognize the assets and liabilities of Elas are at fair value on the date of acquisition.

This has the.

Ultimately, increasing the book value of mineral properties and current assets to fair value as described in note four into our financial statements.

Future cash flows are not impacted by the resetting to fair value, but future earnings are.

The assets impacted were.

Inventories finished goods leach pad inventories and sulfide ore stockpiles.

As these assets are processed the associated production costs will increase reflecting this recognition at fair value.

This was evident in the third quarter as we sold the gold infant.

Tori acquired and produced from the heap Leach.

You will note a $19 million increase to production costs, principally due to these impacts.

Finished goods is a one time impact, but heap leach will carry forward for a number of future corners and the ore stockpile.

Of animals, which equate to over two years of plant throughput.

Will impact certain periods over the mine life as they are processed.

Finally, the mineral reserves see a significant fair value bump in this case just under $1 billion.

So as we mine and process.

Yes. These ounces, we will incur additional depletion expense of approximately $180 per ounce.

So as mentioned earlier, all noncash impacts, but important to understand in estimating future income.

Next it gives me a lot of satisfaction that we can now.

Now the first dividend for the merged FSR commencing in the first quarter of 2021.

It is strong evidence of the strength and maturity of our business.

The base quarterly dividend will be five cents per share representing an annual yield of approximately 1%.

Set us recurring quarterly dividend is expected to be the primary method of capital return.

We will periodically evaluate supplementing this dividend from 12 month trailing excess free cash flow in the form of incremental dividends and share buyback programs.

I have confidence.

While the outlook for metal prices and our business will provide significant opportunity for capital returns as we continue to deliver shareholder value from the portfolio.

Finally, I look forward to a great fourth quarter.

We will have the contribution of Chuck blur for the full quarter.

I see and expect all four assets to close the year strongly in an environment of robust metal prices.

With those comments I'll turn the call over to Stewart, who will discuss our operational performance and organic growth in more detail.

Thanks, Greg otherwise I'll start with a comment.

On health safety environment community relations.

The considerable amount of energy abuse has been extended through and before the integration process to ensure that we manage touches the and the risk in the business.

Experience has shown us that in periods of change, we have distraction and risk kind of it is added.

Overlay or protocols and anguish through everything and Twentytwenty.

We have a well resourced and experienced high cissy and operations teams in Ace who saw.

Who have managed to achieve impressive results over the U.S operations managers have done an impressive job of maintaining our high chesley standards, while managing the.

Business and in some cases restarting them in the coated world.

Safety matrix with disappointingly slightly down through the middle of the year, but are now improving.

Protecting and caring for EPS April the environment and the communities underpins our business performance and we will continue to be a key.

To be focus area of all of our teams.

Each of the sites has a slightly different approach to dealing with coated management Tyler to the situation and the specifics of the saw it I'm confident that all of the saw it so taking a very strong and proactive stance against kind of it and our increasing protocols ahead of rising statistics.

Thanks.

Now a brief comment on each of them on so its please move to slide 10.

Chip has not had a direct interruption through the cobot pandemic there have been some indirect impacts, including some impact on production and pushing back of some work and costs into next year.

Through the first.

Nine months of the year, both oxide and sulfide plants produced a total of 224000 ounces of gold for approximately $214 million in pre tax free cash flow.

There have been some reductions in workforce as a result of containing which have affected operations.

As a result, there were some changes made to the mine plan to compensate.

Chipper remains on track to achieve full year guidance.

The sulfide plant continues to operate at above design rights compensating for slightly lower than planned grade and recovery.

The change to the mine plan and showed that the manganese pit cutback was.

Was completed on time, and we are now starting to modeling the higher grade ore in this period.

I would apply one was inspected during a brief plant shutdown in July and found to be in excellent condition.

The autoclave one shutdown previously planned for the second half.

Has now been pushed back to Twentytwenty one.

There are no autoclave shutdowns planned for the rest of the year.

Exploration in the region and within the cheerful and mine area continues with encouraging results, which we plan to share soon.

Along with the other targets that we've previously discussed our VP exploration hypothesize the presence of a porphyry intrusion.

Relatively close to the ultimate bottom of the chip let mine pit.

Mid year, we started testing this target, which we've creatively named see too and.

And having said intersected mineralization consistent with a porphyry intrusion.

We will share the data when the analysis in the queue I QVC is complete.

Engineering, an early works as a supplemental flotation plant advanced during the quarter.

Flotation plant will increase the sulfide plant throughput and lower unit costs the impact of the flotation plant is being incorporated into the upcoming Schaeffler District Technical report.

The updated technical report.

Call will also contain a PE by outlining the preliminary development plan for outage as a reminder, outage is still being explored and the resource will expand the adage P.I. represents only drilling from twin up to 29 chain.

We restarted.

Drilling in March April of this year after a bit of a kind of a delight subsequent 2020 drilling confirms extension to the mineralization.

We will shortly provide an update of the exploration at adage, including both infill and step out drilling.

The technical report will be.

The report released before the end of the year after Finalization of engineering and business assessment and of course approvals.

Please move to slide 11, and we will talk about Marigold.

Marigold continue to operate through covert a great credit to the mine management again, there have been in.

Indirect impacts that affect both 20 and 21.

Total material moved was another quarter above 20 million ton. Despite some teething issues with our new hydraulic shovel.

We believe these issues are now mostly behind us shorter hauls into next year will facilitate higher tonnage right. So the mine.

As expected the head grade increased in the third quarter versus previous quarters.

Overall, we stacked just over 73000 ounces recoverable in Q3 and expect to finish the year within guidance all in sustaining costs. At 12 43 took a hit from the increase in royalties as a result.

Of the gold price as it did at all of the slides.

Hi, gold prices are a nice problem Pat.

Exploration drilling continued across the property with some interesting results.

With land acquisition over the last few years, we are assessing the portfolio of opportunities across a very large package in the region.

Very prospective areas on the edge of both mining areas and close to all tenement boundaries are some of the areas of focus obviously, we avoided sharing our excitement for these while we negotiated to purchase the abiding areas.

We will provide some update on the marigold tenement exploration in our group explorations.

An updated slide of this year.

Please move to slide 12.

So it really is a great high grade mine with lots of potential.

From a health and safety perspective, we've been doing a lot of work to comply to comply with the new diesel particulate matter requirements stipulated by the province of Skechers.

This involves a lot of improvements to existing equipment.

As well as we recently started commissioning of a new ventilation rise and fans, which has made a very big improvement as designed.

As you know, we shop savvy down as a precaution for cobot. This action also pushed somewhere.

Working capital into Twentytwenty, one so.

C B ramp backup in August and in September we had a record milling month.

Offer an average of 1200 71 tons per day. This included our best ever one day throughput of 1500 22 tons a day.

For perspective.

If the year that prior to assess our mining purchasing survey the mill averaged 760 tons a day throughput.

In the paper that was really subsequently in 2017 mill throughput was estimated to average 10 50 for the whole life of mine. So the current throughput rights demonstrate.

Upside to the production profile.

Mine is currently.

Bottleneck at Seabee.

There are also a real continuous improvement opportunities in the mine at Seabee and this will be an area of considerable ongoing focus we recently approved the replacement of an older jumbo along with an additional jumbo for them.

The mining flight.

These purchases will come across the ice road in early 2021.

During the shutdown for co that there was a lot of maintenance of both processing facility and the mobile mining equipment.

Which will support productivity going forward.

CB has great exploration potential both immediately.

On strike in the current mining areas and in the very large tenement package along with the contiguous Fisher tenements.

You might have seen that we recently satisfied in and requirements at Fisher and are now 60% owners with an option to increase to 80% in the future.

We are looking to.

Increase exploration around the mine this year.

When we do the corporate exploration update later this year, we will update you on some of the interesting exploration results from CB and Fisher and from our productive summer program at AMSC, which is about 50 kilometers to the south of CV.

Now placed money to slow.

Slide 13.

Turning to ramp back after a hiatus for coated infection rates in Argentina, including the Corona reached.

Reached well into the 20% range, but we've seen generally pretty low severity and few hospitalizations and team have done a fantastic job of our sliding them on.

There is of course, a cost of very tight cost controls.

The Montana plant have ramped back up really well and the plan is running regularly at above design throughput and recoveries tiling pumping system that causes some consternation last year now appears to be fully resolved and in control.

On the back.

By silver prices and a low cost Turner is forecasting produce.

Good cash flow going forward.

And all in sustaining cost of $11 26 for the quarter. Despite the shutdowns in KOVA demonstrates the potential of pruett tuna.

We are very excited excited to see what the team can deliver day.

Hi, I'll move to slide 14.

I've covered off most of this already so in summary, our focus is on first operational discipline and continuous improvement to delivers from our tremendous operating assets secondary.

Leverage off effort all organic guidance.

Hi portfolio.

With our immediate focus on converting some of the near mine low cost plus prospects into production.

You will get a look at the first is days over the next days when we reveal outage PPI in the chair flood Technical report in the next few weeks.

With that.

I'd like to close in the hand back to Rob.

Well, Thanks, Stewart and Greg.

So despite the challenges runners bark hybrid we've done an amazing job managing our operations completing the merger in integrating both companies into the new accessories.

The announcement of a dividend highlights.

Financial strength of the business and a responsible approach to capital allocation.

And finally, we're lining up a number of catalysts that will show the value and exciting growth potential from within our portfolio.

So with that I'll pass along to the opera and take any questions you might have.

Hello, operator.

Thank you we will now begin the question and answer session to join the question queue. You May Press Star then.

So one on your telephone keypad, you'll hear Tom acknowledging your request. If you are using a speakerphone. Please pick up your handset before pursuing any keys to withdraw your question. Please press Star then two Jamie.

Hey, John a question. Please press Star then one now.

Our first question comes from.

Obese Habib of Scotia Bank. Please go ahead.

Hi, guys and congrats on a good quarter and thanks for taking my questions.

Just a couple of quick questions from me.

Just starting off with the triple or great to hear how well the auto club.

Performing.

You mentioned the autoclave shutdown is now or other club number one shutdown is now expected in Twentytwenty. One is this shutdown expected in the first half or second half of 2021.

We are scheduling it in the first quarter at this point.

The first quarter and and I mean in terms of.

The shutdown that you saw in.

The auto club number two.

In terms of how the while the ramp up is going on.

Is there any kind of optimizations or anything that you guys need to do within those other clubs that you're seeing or is this just a routine shutdown that you're expecting in the.

I will never stop.

When I look through to the end shut that it's just a routine shutdown. The the main driver for this one will be the replacement of the agitated bites.

Because they're aware autumn and eventually that wed have lasted.

Muslim with than we had expected to.

That were expecting to have to replace some light.

Per quarter.

And just then moving onto.

Exploration drilling at our lead John you mentioned that recent drilling has started around the April timeframe.

Has that been mostly step out the info and can you give us an indication as to any sort of preliminary results that outcome according to expectations.

Systems.

Yeah. So the infill drilling has confirmed what we expected to see and yields and then we've been stepping out around around the existing resource.

When we issue the when we issue the.

Update in the next few weeks, we're planning on breaking it out so you can see what's infill and and wants to have.

Okay, and just confirming none of this will be included in the study.

No no well the technical report as you know we have to pick up.

Patients in time, so we closed we closed we prepare the technical report Mrs. Subsequent so it's all upside to what you'll see in the technical report.

Okay. Okay, and then just moving onto Seabee, and then I'll jump back into the queue, but.

In terms of CB throughput was was definitely hitting a record.

Throughput levels is that expected to be sustained at current levels going into Q4 and 2021.

And also can you give us any indication of what the stockpile grade for the 17000 tons is.

But the challenge the challenge for CB in the longer term is the is the mine rather.

<unk> Atlanta, So we are putting some extra equipment and then my comment regarding the jumbos, So new jumbos.

There are some requests or some other equipment and we're working on improvement plans to get the mine right up in order to be able to say tomorrow.

The mill feed the plant at a higher right.

So I'm not promising anything beyond beyond the numbers that you previously will soon it'll take a while for us to get some traction.

But there is definitely good upside at Seabee.

And then just any insight.

Indication as to what.

Yeah, you can give us the information on the 70000 tons of stockpile great.

It's a very small stockpile. It so it's pretty much just the wrong say, it's it's around about the average grade of seeding the plan.

Got it.

And I'll leave it there guys and jump back into queue. Thanks.

Great. Thank you both.

Our next question comes from Cosmos Chiu of CRB seats. Please go ahead.

Hi, Thanks, Thanks, Rod Stewart, I think Greg and Greg.

Very good financial today, and Thats certainly good to see that you put in a dividend tier.

I guess the market likes it as well.

Maybe first off on Kepler.

As you talked about you know the cut back here and Megan East pit is still on time and looks like it's going to start contributing some higher grade material.

It is it can you remind me is that both of the oxides and sulfides that will benefit from it and what the magnitude in terms of the great improvement versus the main pit here.

Yes. So there are there is a small contribution of box on the.

The the contact is sub vertical in manganese picked side when we get to the bottom of the pit we.

We still do get small.

Amounts of oxide.

And with regards to the ride I don't think Weve.

We have disclosed sort of.

What the incremental increase will be but you remember that.

Jeff a morning, right has always been higher than the than the processing right.

It was in the original technical report.

So we do feel the higher grade as it comes to the plan.

We are as I've discussed on previous calls always having to juggle.

Great and chemistry.

And it's one of the it's one of the advantages that will have when we get the flotation plant in Italy will have a bit of a disconnect between the chemistry, because we'll have a bit more control over sulfide grades in being able to manage.

Carbonite reporting to the Autoclaves.

For sure understood.

And then again on AAA her as you mentioned the Mdna TFS.

Construction, you had to slow it down a little bit however, you're still advancing ahead of operational requiring.

I meant.

With that said I'd.

Deal World would you want to catch up on that construction later.

Later on maybe sometime in 2021 is that why you've talked about you know some of the capex catch up in 2021.

So weve with the.

To having stem at.

Shareplus.

Another way to think of it is the lifestyle for them on.

So we take the competent suitable.

Mostly limestone material from the mine and use it for the placement.

With compaction into the wall.

And.

As a result, the role that the rise additives issues driven mostly by the morning, right rather than the plant requirements. So we were a long way ahead of where we needed to be and when we didn't have enough drivers. What we did was founded area to stop color or I'm, sorry, the the the tailings dam wall.

And all material part.

Partway through the tailings dam, so that we could free the flake backup to go into the mine and were now there is a there is a small cost associated with that because we have to pick it back up and then take it the rest of the wise. So there is a cost to pick it up at some point in the future to move it out to the tailings dam, but where we are lost.

A long way ahead of where we need to be in the tailings dam and we will remain there.

For sure.

Again, maybe moving ahead to marigold here.

Well as you talked about you've been transitioning from the lower levels of Mackey five to now the upper levels are my Q4, and then I think phase eight is also coming in.

You talked about the grade being lower year over year due to the fact that you're transitioning into the upper levels I'm asking for.

Again, I have not I haven't been to Marigold for a while now but can you remind me in terms of how they I don't remember a lot of grade variability between the different phases, but.

But.

What are you getting in and out of it or could you give us some color in terms of you know the grade profile maybe.

You know intermediate term and also potentially longer term as well.

I can give you part of that and we'll appetite the risk or not sure.

You are correct, we are transitioning out of Mackey, five and six in coming back half into for a night.

Now and that we will be back down in Mackie.

For instance, five.

Think about the second and third quarter, but our.

I have to confirm those numbers for you.

Going forward.

But I guess as you go deeper.

As you transition deeper into the mind, you get higher grade sometimes as you are at the upper levels, we get lower grade and then you would come to that kind of kind of Mexico.

Yeah, we have been we have been below the range.

Okay, Great and we're moving back towards the reserve growth.

As you would expect.

Okay, and then maybe one last question here on CB Santoy.

Stuart as you mentioned you know there's there's the ice road that's needed every year to replenish your inventories your supplies.

Any kind of concerns in terms of Workover 19.

Impacts and what what not.

Can you remind us I guess number one well what is the timing of building the ice road and number two do you foresee any kind of impact will.

Given the current pandemic.

So sorry, now we'd we'd.

Don.

We expect to see any impact we build the right ourselves with their on time and the team is is ready to go to do that work as they normally would we we start building it to.

At the beginning of next year, we don't have to bring quite as much as we would normally bring across the our stride this year.

Because we were shut down for a period with Scott.

Those.

Materials and inventories supplies.

Onsite already.

So I won't be as big year as it usually is coming across the Australia, but we don't see any.

Any any impact from Cove it.

Middle East failed.

To do that.

And again when are you going to start building. It so when is it going to get cold enough.

Hi, I think I started January.

Okay, certainly certainly.

Then if they need to wait for it to start to phrase and then they then I start to blur.

Then then I progressively take small.

Our trucks across to get it to heart and so moving the equipment across it hardens it.

And then usually by about February.

They're getting ready to to start to run it.

Mhm.

And maybe one last question maybe for Rod here again, taking a step back looking at the Big picture here you know.

Clearly one key catalysts is de Trippler technique.

Technical report coming out and it's great to see that.

Exploration results are coming out as well, but again.

When can we expect.

Are you expecting to put out some kind of longer term sort of guidance, maybe three year guidance in terms of production.

Hello, and costs and on top of that you guys you talked about rod Youre looking at optimizing the portfolio and you know when can we start expecting more details in terms of Capex in terms of what's in the core portfolio what might not be.

I will certainly there's pit area that generic you know there was some.

But there are some talked previously about new trucks at Marigold I'm, just wondering about timing and what kind of detailed could we expect thanks.

Thanks, Rob ever that yeah that was a long question cause I appreciate it.

I think I think where it would sort of say you know as a.

As a new team that way.

Really to get the quarter three results and work behind us because it's been an important.

We are important for us to sort of demonstrate this.

The strength in the business and as well as we're now moving forward.

I think in the meantime, you know we've been basically work.

On bringing the organizations together and also ensuring we stay in things out and as part of that developing there are the catalyst rich.

And the answer is that will come out here as we close 2020 off.

And then moving into 21 study to look more about.

Looking in the in the exploration and growth area, particularly.

How it all sort applies to give us a so I think first things first.

Finished the year.

We've got catalysts already lined up as we've outlined.

In the quarterly results and.

Then into next year starting to starting.

Lauren all those up together and so you have a plan in terms of our.

Growth profiles in portfolio management.

Moving into 2021, so sorry, we got plenty only apply a pretty excited by the other growth potential and I think it sort of plays out when you look at our capital allocation stretch.

Gee I clearly, we've got an API into the business to ensure that we continue to reinvest.

We're continuing to ensure that we have the balance sheet to our to bring some of these these opportunities forward and.

And returning capital to our shareholders well I think we've covered a lot already has.

New team.

But we've got a fairly aggressive plan moving into 21 as well.

Thanks, a lot rod and that's a great answer and thanks again.

Our next question comes from Dalton, Colorado of Canaccord. Please go ahead.

As it.

Thanks, operator that evening everybody right.

I'd like to start by wishing you and your team all the very best for the New company.

Dodd said.

It is a very different company than a lot here and so I really like to get a sense for how youre now given the world to the EPS.

Yes, our lands in particular I'd love to get your thoughts on how you're thinking about growth versus shareholder returns and then also rests on the jurisdictional from a balance sheet perspective.

And then just finally your thoughts on silver have given us as far as legacy operation does not assume a starbucks.

[laughter].

Look I think don't win.

When the pull and I were talking to you about the the merits of the.

The the merger and bringing both companies together, what we saw was a a very close cultural alignment and ER in the lanes that we look through by the businesses, where eerily similar and I think that held true to where we.

We ask that ISO.

From a lot of prospects, it's business as usual and and getting the team to get going and starting to think about what are we doing as a business what do we need to deliver whats important where do we prioritize our capital for the growth Yeah, a lot of the elements in and.

Framework was already in place and thoughts were imply so so thats why were taking in a lot of regards we've hit the ground running and that's what you're saying obviously play out here with the.

The quarter three results in a number of the other catalysts coming up further in the next in this quarter in moving into next year. So.

So we're in really good shape, and and I shouldn't be surprised that they want because we did talk about.

We did talk about it.

In terms of prioritizing some of that growth opportunities I've said, a few times that what we see in front of US right now is low capital intensity.

Across the portfolio because a lot of them are brownfields opportunities.

Charities that anymore.

But of course, we have a number of.

Exciting greenfield opportunities within the portfolio quite an extensive allotment.

Allotment that weight way progressing through and.

And looking how that might play out into our capital needs moving forward as we as we can.

Continue to evolve the SSR story.

Beyond this year and probably be on Nick next year as well I think that plays out I mean, our capital allocation strategy that I just mentioned.

Clearly there is an element that we want to retain money to grow and invest because that's the best Bang for the Buck for our shareholders and.

In high yielding growth and we'll see how that plays out so.

We've got it all before US we've got a great platform to start with we're off to a good start and.

Look forward to presenting more of these as we move into next year.

Your last question on silver.

Now clearly.

Clearly with.

Sooner or it's specifically.

People have asked about the.

The future tuna Qunar is a great contributor to the group level I mean, its cash generation so it.

It shouldn't be lost on folks that do not for us wallet wallets still does that and still generate side.

On a.

Permian spices right, great free cash flow.

Yes, its welcome within the portfolio.

Against the other the other three operations, so thats not going in proposition.

And that hasn't changed at all.

And yes, we'll obviously continue to assess tuner.

And are in the longer term to see whether there are other opportunities around it as well that may it may.

Am I actually evolve here into into something different so that'll be part of the thought processes moving into 21 as we continue to look at all the organic growth we have.

Our next question comes from Daniel Morgan.

Please go ahead.

Hi, Ret broad and Tim.

First question just on Chaplin.

Are you back on you know reasonable Manning levels can you just discuss you know the kind of it impacts it shepler and and maybe just touch on the other assets you know way around.

On that issue as well thank you.

Yeah, So chip was.

Chip was back up to full Manning chip was actually got a rapid testing up and running it. So it now are they still are flooding paper for a week when they come in but they are doing both and.

Jun testing.

And ER and testing for the virus itself I wish I can turnaround in about an hour.

So.

We've got better control and things do seem to be improving in it.

In tuna.

They had very high right as I said in March.

But you know they were up getting 25% positivity rights with Paypal It hasn't just in the last week or two really markedly dropped down.

I guess that means everybody's had it in there I mean, but there so.

So things seem to be getting a bit easier there.

<unk>.

At Marigold.

They've got quite a lot of controls in place to control people coming to saw it and ensuring it.

As you May know, Nevada re seeing an increase in rights.

But the protocols that we've got in place a well established now and it's not impacted.

Joining us from a production perspective.

And then lastly at Seabee CV, we have had some issues with planning, particularly where we have quite a lot of indigenous folks coming in from sort of remote areas and.

And where there are instances where we.

And from infant.

From Saskatoon, as well, whether instances of family members or friends being positively after the live and coming back to site. So we are seeing some impact, but it's not as much as it was previously.

Okay. Thank you very much and.

The grades.

In stock the Marigold is saying a big uplift or can you just talk about what you expect for the next couple of quarters I imagine that will go up towards you know half a grandma or more of a Q4 and into Q1 is that about right.

Night, we start head back up towards the reserves average.

I'm not sure they got to get to a point fall.

In those in those periods.

I think it's a little bit below that but heading back towards the reserve numbers.

Okay.

And then maybe just the dividend I'm just came to explore the capital return.

<unk> framework that you've outlined a little bit more so great to see a dividend or earlier than I had thought.

<unk> 0.5, or so sorry, five cents per share, which which is the basis is that just every quarter you know you're going to pay that and then just wondering how the supplementary works is that.

Recorder, you'll look at the free cash flow for the quarter behind you and go Okay. We're looking good.

Powder supplementary or is it something that you might do on more a half year or annual basis look at the supplementary.

Thanks, Chad Thanks, Dan It's Greg I'll, just take that question. So as you say.

And we're certainly pleased to have the initial dividend announced then we'll start paying the regular quarterly dividend of five cents per share starting in Q1 EPS 2021.

And you know we will look at capital returns as one of the uses of our capital compared to you know as Rod STI talks about lots of opportunity.

You see on the portfolio.

So.

Well, we will look at those supplemental dividends on a trailing 12 month term bill basis. So as we start to bed down the combined business and get those results put together. The you know the board will periodically review that so you know I think give us a little bit of time here to get things.

It all down in that the board will start to look at those supplemental returns and we'll be comparing.

Incremental dividends again share buybacks, just depending on market conditions and against other needs within the portfolio.

So on that and a follow up question just on the mechanics.

You know what do you need to do it mechanically to get a a buy back in and in Platts forgive me I'm not as I'm familiar with perhaps a Canadian Laurel jurisdictions regarding this you know you do need a H.M. approval is a board resolution.

How would you do that and and also a follow up question on that.

It is how do you make the assessment of a buyback versus a dividend.

[noise] yeah. Thanks, So you know within Canada. There is you know a normal course issuer bid structure that allows you some buyback opportunities tied to your liquidity. So a certain amount of volume so that is one strike.

Sure and if you you know if we wanted to do a more significant piece then yes, it's there's more regulatory and other approvals required and in terms of that in terms of the trade off you know, it's really going to be driven by really where we see market valuation conditions overall and again, if we see if we.

I see an opportunity where that makes more sense for our shareholders. Again. This will all be focused from a shareholder loans in terms of how we make that decision.

We see that as being a preference use of capital will move in that direction.

Okay. Thank you very much for your response.

Thank you.

Once again, if he has a question. Please press star then one.

Our next question comes from Mike Parkin of National Bank. Please go ahead.

Thanks, guys for taking my questions and congrats on the good quarter.

Just a follow up there on the N.C. I'd be.

ER or assuming that's.

The vehicle you pursue like a share buyback would you be using you know like a peanut valuation that's something below spot like something.

Our trailing 12 month average or something so it kinda determine.

Whether or not you're actor within and savvy person.

This is a cash payment.

Yeah. Thanks, Mike.

Obviously, we'll look at a number of [noise].

General market conditions. In addition to specifics you know any specific factors that are playing out so.

You know I don't want to get a you know teach this year.

Thank God, because obviously, we see you know we're in a cyclical business here and we see them you know we can see a lot of volatility.

In market conditions over time, and so again, we would be looking at it over long term valuation part certainly it wouldn't be our intent you know to you know to.

To use that structure and last we've done he thought we were in a strong strong position to do so on a valuation perspective. So I think as we said we see the quarterly dividend as the primary recurring return of capital.

Then we will look at these on a supplemental basis. So yeah, you know I would again focus you in terms of what Weve said.

Said, there around the dividend being the primary.

Capital of the Turnkeys.

Okay, Yeah that makes sense.

Switching over to you know some of the stuff that's coming down the pipe in the next few weeks with respect to our Dutch you mentioned, how it'll be P.A.

What are the next steps after that.

Are you going to go through like a full feasibility study or given.

Rock record and experience, it's a regional kinda satellite or you.

Are you more comfortable having an earlier stage.

Economic analysis on it to move ahead with a construction decision.

[noise].

Yeah. Thanks for that so we've determined to provide to the P.I. because we're still exploring it so it's still growing.

We wanted to give any indication of what our expectation was for the development.

And the development potential for due to its quite separate from chip for in that.

It's removed will have to spend some capital long and then.

Bring that across and price so sort of the triple play with an expansion of the heap Leach at Sherpa, that's all incorporated into the into the P.I.

If we if we'd gone down the pathway of doing reserve, we could have all of the.

Presented a smaller case that wasn't as indicative of what we expect it to be and then had to have done a subsequent reserve. Our expectation is we'll we'll issue. This it's a as I said earlier, it's a point in time and it represents a point in time.

A development opportunity, but the resources. These obviously already growing outside of that and our plan will be sometime in the next year or so to issue an update and at that point it will convert into a into a reserve most probably a reserve integrated chip.

But we'll we'll see but it will be a reserved in the next year or so.

Okay, so spending should be pretty much not much other than exploration color. So in the next 12 months.

No no we don't have a lot to spin. So we obviously, we've got the development costs as you know the middle Eagle test.

Combos talks, but that's helped the order of $10 million.

Okay.

And just with.

Phebe on an exploration standpoint, you do tend to kind of do more if your expansionary.

Step out drilling in the winter time.

What is it that you're aiming to kind of focus on I remember you know a Batman zone, but pretty exciting last year with results coming out of there plus some additional intercepts along but the six ships santoy shear.

Does it follow up work there are additional targets that you're aiming to test.

So there's quite a number of targets along but mineralized trend that goes down through Fisher and then branches up also to the I guess to that no.

Northwest as well.

And we have a series of targets so in the exploration you'll see that phase.

Some drilling as well as field exploration in those areas as well as in and honest I feel exploration and honestly it further away.

And in and around.

Around.

Around santoy itself.

And of course, we've been working on the GAAP hanging wall over the period as well I'm getting ready to convert that into reserves.

Okay. We are looking we are looking this year to maybe invest a little bit more.

Exploration in around CP to give ourselves a bit of a longer time horizon for decision making.

Okay and can you just remind us on what you need to do to take that ownership on Fisher from 60 to I believe you said earlier, 80%.

Yeah, Hi, Thanks, Mike its a its Greg here. So it's really just a one time 3 million dollar payment. It's due to our partner to do that to increase from 60 to 80 and well.

Well look at bad here as we work through the next number of months.

Okay.

Thanks, guys. All my other questions were answered so thanks very much.

Congrats again.

Thank you.

This concludes the question and answer session I'd like to turn the conference back over to Rod Intel for any closing remarks.

Well, thank you and thanks, operator, I'm wondering I appreciate everyone for participating today I'm on Oh first Uh huh.

First call as a combined entity and I wish you all a good day. Thank you very much.

This concludes today's conference call you may disconnect. Your lines. Thank you for participating and have a pleasant day.

[noise].

Yes.