Q3 2020 Fortuna Silver Mines Inc Earnings Call
Ladies and gentlemen, Hello, and welcome. Thank you for joining us for this Fortuna Silver mines third quarter 2020 earnings Conference call. As a reminder, all phone participants are presently in a listen only mode, but after todays prepared remarks, you will have the opportunity to ask questions to get US started today with opening remarks and introductions I am pleased to yield the floor to.
Yeah, our manager Mr. Carlos Baca, good morning, Sir.
Thank you Jim.
Good morning, ladies and gentlemen, I would like to welcome you to Fortuna silver mines and for financially and operationally sales calls for the third quarter EPS 2022.
Today, we will be using a webcast presentation, which will be controlled by us put down on the person stays on these goals for web site unfortunate silver gold sleep on the best for stuff. They speak on the financial sometime in calendar Q3 click on the earnings call webcast link.
Okay. That's all I know some pressure on C O N director and we use that for you I know CFO will be hosting the call for your management policies eliminated [noise].
Before I turn over the call to Jorge I would like to indicate that this earnings call contains forward looking information that is based on the company's current expectations estimates I mean [laughter].
This forward looking information on it is subject to a number of risks uncertainties and other factors actual results could differ materially for my conclusion forecast or projection in the forward looking information on certain material factors or assumptions were applied in drawing that conclusion for making up for cats or for objective for us.
Next on that's reflected in the forward looking information additional information about on material factors that could cause actual results to differ materially from the conclusion forecast or projection in the forward looking information and on material factors or assumptions were applied in drawing a conclusion or making a forecast or projection as predicted.
On the forward looking information is contained in the Companys I don't have information on farm and Mdna, which are publicly available on SEDAR.
That goes on any assumes no obligation to update such forward looking information on in the future except as required by law.
I would now like to turn the call ortho for.
No surprise since CEO and co founder on Fortuna.
[noise]. Thank you Carlos and good morning to on I'd be presenting on the production for third quarter results on these because it's done so for operations in Mexico, Peru and Argentina.
And then during the growth over to Luis who will take you through the financial statements.
On slide six of the presentation.
[noise] on slide six a presentation in the third quarter, we had reported the highest financial figures in the company's history for sales free cash flow from operations on an adjusted EBITA.
Free cash from operations was a strong $30 million and our EBITDA margin stood at a robust 51 per cent.
Overseas sales.
We have $85 million seen gosh as of the end of the quarter and that go on for Dolby Queasy position on 540 million with a modest debt to EBITDA ratio fell 2.7.
Idling day do we produced our first gold on October 20.
We are for in gold every week on made her first sales for the November wearing maersk in the ramp up activities with the aim to stabilize production at PCB to design parameters by year end the need for the first quarter.
And despite continued Gabi 19 related restrictions for mine seems they do and make equal met production of Jay for objectives during the quarter.
Argentina.
Restrictions on flow of personnel that gross national on for leisure waters hamper on drag on our ability to provide a quick response to the various issues that arise as part of any production ramp up phase.
Across all sites.
We have streak sanitary brother goes in place I have taken over 8200 Bcr. This store personnel reporting approximately 391 positive cases for garbage so far.
On slide seven.
[noise], we share here or key safety performance indicators.
We present the gate the Isis a 12 month Rolling average do better for you said trends.
During the third quarter, we had a spike in lost time accidents.
These were mainly related to the started this whole for operations suddenly in day to work they've worked for US he is largely local and gaining experience.
On mining.
The series deals. These accidents was minor as shown by the injuries series the rate on the graph to the right. Nevertheless, a blend of fashion. He seemed place do for their mitigate risks associated due largely to an experienced workforce idling day seems fight for all over the training that day.
These new work force has been through.
Slide eight.
[noise] silver production was have a budget and a previous year by seven cents per cent respectively.
The increase was driven by improved grades as our San Jose mine.
Gold production was above our internal budgets and on previous year by 17, and 12% respectively.
The increases were driven by a welcome contribution of approximately 1400 ounces of gold from day to day, human mines, and higher grade said, though or San Jose mine.
Goal that you on that he's coming from a small near surface high grade ore shoot.
Which is an unusually low curious at these mines and we're carrying studies to better understand the geologic controls of diesel Coors.
Slide nine please.
[noise] silver accounted for 59% of sales on 28%.
For gold for a combined 87 per cent breaches made subsequent for use in the quarter, we sold silver I realized price.
$24 on 90 cents per ounce compared to $17 per ounce a year ago.
We sold gold at a realized price of $1925 per ounce going for two.
1487, a year ago, we continue to observe with expectation the consolidation or what is configured to the historic bull market for precious metals and mining equities at a time when we are prepared to deliver on material growth in nine years low production driven by for leading data on my.
Hi.
Nice then.
As I mentioned in the highlights slide as they start the presentation, we had record breaking quarter in terms of key financial metrics. This performance was driven by higher metal produced on significant increase in precious metal prices as just mentioned sales.
Whereas 36% to 83 million.
That was up 120% to 42 million on adjusted net income was up 747%.
$16 million for nine cents for sure.
Slide 11.
San Jose.
All in sustaining costs increased 11% to $12.
[noise] per silver equivalent ounce.
The cost increase was driven by components, which are sensitive to higher price is like a workers' participation mining royalties and sustaining capex.
I tell you I'm all in sustaining cost increased by 23% to $19 on 40 cents per silver equivalent ounce I, sorry, so to have 21 day.
Mortgage related volume very suspension of operations, we took during July.
Like golf.
Year to date for capital expenditures on sustaining operations growth on exploration amounted to $50 million Lindero GAAP. It seemed like water amounted to 12 million.
On our financial news release dated August 13th we provided guidance for total remaining funding requirements for line data to be in the range of 55 to 60 million.
We are executing within these budgets and expecting there to be largely self funding in Q4.
On slide 13, we share with you for first day of ours produced at lien debt on October two and a major milestone for the Dean for the company.
We are boring dodi gold every week and there were for sales have taken place in November.
Slide 14, we share a simplified view for major milestones on schedule or broadly.
As I mentioned before we are immersed in the ramp up of production on plans to be in operations asked me, saying.
Rates in Q1 of next year.
In slide 15.
[noise] you never.
On the narrow construction is substantially complete in these initial.
The initial months of production were observing a very good reconciliation between our long term block model on last call something.
In these early days leaching kinetics for gold are also tracking according towards these high end curves.
For 22, any we are revising our forecast for gold production has been data to between 13000 ounces on 15000 ounce.
For these for because we're taking into consideration the temporary operational restrains to incorporate irrigation fire sales at a faster pace than originally thought.
This is due to the advanced stacking sequence with trucks were using this issue goes away in November with the start of conveyor stacking.
Additionally, management is taking a more conservative approach for the ramp up of the Hbr agglomeration Unstacking season.
Govies related restrictions for the movement of personnel to site on.
Between provinces in Argentina, Isa source of small, but green delays on the teams moves to solve their various issues that arise as part of any ramp up for us.
In the next slide.
We share with you views and updated photos of the.
Gordon status over the on the site.
And I would invite you to visit or or website, where we keep an updated gallery.
Photos on slide.
20, sorry, 16, we share with you a view of the beat if these are the people are moving this scheduled 40000 metric tons. So my theory on every day, but we took about half he's or on Hafeez weight based we're keeping within the schedule.
Strip ratio of one.
Okay.
The beat these run very efficiently is performing well five for 100 on trucks to wheel loaders.
To production on drill rigs so tight meet operation.
The next slide we share with you a view of the secondary essentially on tertiary crushing.
[noise] following slide you said you are for agglomeration.
We have been dealing on solving issues that are normal to ramp up.
Hey, you know improving dust control is making adjustments to some of the shoots and on and on components of the crushing system. What I can report that we have not identified any material issues.
And we're trending in the right direction with respect to achievement of design parameters.
Okay.
In these lights globally share we have a view for first irrigation sales.
[noise] looks like at least there. We'll then a view of the our plant and balance area.
I mean, the last line, we share a view of the Sars Glenn the third plant is the last part of the.
System that will come in.
In line, we expect they start commissioning to initiate.
The second half of the of November.
On our core it a asset portfolio on here just.
[noise] highlighted the fact that a lean day, though.
We'll be moving up to be Niccolo, they fear I mean, joining San Jose and pay on a us our third mining operations.
Moving on to I, let Luis now take you through the financial statements highlights.
Thank you for <unk>.
So its as was previously.
Mentioned, we had a record quarter in terms of sales EBITDA on cash flow.
Recorded sales of $83.4 million or 36% above Q3 2019.
On the back on higher metal prices higher metal production and.
Partially offset by higher treatment charges from 2019 reported quarterly net income of $13.1 million and 16.1 million on on adjusted basis and earnings per share of seven cents.
The last thing that comparative period of Q3 2019 was related to an 8.2 million foreign exchange losses related to the early NATO V.A.D. receivable in Argentina, Inc.
In Q3 2020, we have reported on a fixed loss of 3.5 million of which 2.7 million is related to the limited it'll be a D.
Also on the reporting quarter, we had a higher effective tax rate than what we expect a non recurring basis with an impact of around one cents per share.
Consistent with the drivers I have mentioned, we saw a material increase in EBITDA on free cash flow as you pointed out as well for.
Cash flow from operations, so $30.1 million, representing 36% of sales.
This number contains a positive impact of around five and a half million dollars from changes in working capital.
Related to timing of certain payable items, but even excluding this effect free cash flow was close to 30% of sales.
So when <unk> slide.
Slide 25, when breaking down our sales performance for the quarter, we can see the highest impact came from higher silver and gold metal price is in particular, a silver price contributed $5.2 million out of the total $22 million increase in sales.
Also worth mentioning that negative impact we see from treating on refining charges on which had been a consistent feature of 2020 are expected.
For the third in 2021 as we are seeing much improved terms on the market for next year.
On slide 26, when looking at our comparative segmented results over Q3 2019.
We can see that the strong performance on both our mines non consent on your mom.
In terms of EBITDA on cash costs.
San Jose there is.
Higher all in sustaining cost in the quarter with Johns Hopkins plane is related to items have caused for their linzess sales and profits, specifically royalties and workers participation.
Also as far as I mentioned, there is a a smaller.
Smaller components relating to the timing of for Capex execution.
Okay financial impact of that 21 day suspension was more than offset by higher silver prices and I'm done significant contribution of gold production in the quarter.
<unk> represented 13% of sales ATCA you on that.
Both mines recorded lower costs year over year that contributed to our improved financial performance.
And as wellness there was some mention because the higher yielding sustaining because I got your line is related to the temporary 21 day suspension.
So on slide 27.
Yeah. They had their operations reflect the cost containment measures implemented in Q2.
The increase in share based payments is strictly related to that performance on the share price our effective tax rate was 53% for the quarter.
Calibration of the Mexico Mexican peso a year to date continues to affect our income tax provision.
And we estimate the impacting the quarter in terms of the effective tax rate was around seven percentage points.
Finally on on Slide 28, we provide an overview of the evolution of our liquidity position over the last few quarters.
Total liquidity at the end of Q3 was $140 million.
The main take away here is that in Q3, our cash position and total liquidity already reflect an inflection point as we recorded a small increase of $8 million over Q D. You do it and sorry.
Total cash expenditures at low.
Indeed on Q3, 2020, where $28 million, which was more than covered by cash from operations.
In Q4, I mean, they do we expect additional construction capital expenditures of approximately $12 million last.
Plus additional cash outlaid silver similar magnitude related to construction construction payables as we close abroad.
Back to your guidance.
Thank you Luis we would now like to turn the call over to any questions that you may have.
Gentlemen, thank you.
And to our listening audience. If you would like to ask your line of question over your telephone line simply press Star then one on your telephone keypad pressing star on one will place your line into the queue and I will open your line one at a time also a friendly reminder, that if you're joining us today on a speaker phone. Please return to your handset prior to pressing star and wanting to be certain interest second does reach on.
Our equipment once again, ladies and gentlemen that is star and one if you would like debt alive question well hear first from Trevor Turnbull Scotiabank. Please go ahead Sir.
Yeah.
Hi, Jorge and Luis.
I had a question.
I bet, you you talked a little bit about what you're doing in the last few months for the year on November December had Lindero can you talk a little bit about how October looked in terms of what you were able to get on the pad in terms of tonnes or ounces.
And can you talk also a little bit maybe about how the mining costs are tracking at a at lindero so far.
Yes.
Silver was ER a difficult month, a in the ramp up.
We had that to break down so ER.
Conveyor head poorly.
Something quite on usual, we never seen anybody on the team a breakup.
For these things like that.
Particularly new fully so that was.
A problem, we'd probably geisha.
Yeah.
That took us down pretty much Ah 12, 13 days in the month right there.
And those are you know very simple to do to manufacture we manufacture them ourselves in south debt.
ER.
And we have manufactured.
For a pet food is something that we have never carried in stock in anyway.
In light of what happened, but nevertheless that took us down on around 12 days in the month so for silver.
Or the sign rate.
Of Ah or design rate of production in the crushing system.
He said about a 1100.
On a metric tons for per hour.
And ER.
We've been.
We are we we're running right now on average around for the year. So far at around 800, not so in the ramp up.
If we're doing well.
Yeah.
Net loss of operating hours in October operating base in this case the pick up too. So as I mentioned I think we're tracking in the right direction. We've done you know theme of for an experienced operators, who we have trained but never there. The list. There is always a curve there as they gain.
For experience with equipment.
Yeah on the limitations with a you know rotation of supervision and speed at which we can address issues right.
But ER.
In November we're faring better.
Okay and again the message I think over all these we are heading in the right direction, where it's just taking a bit longer because all of these drugs with the difficulties to move for so now.
On that are related to our ability to so each.
Issues on site right now.
HM.
And with respect so now that November is is kind of settling in and it's a little more typical of operating can you can you say anything about how mining costs look on a unit cost basis compared to what you're targeting.
Hi, Trevor I'm not unique on a so the mine are well within our expectations, we're not seeing any significant deviation. So us for for Q4, we we expect to be reporting.
Ob net capacity to report mining costs within our original plan, there's not much variation on that side that different of course for <unk>.
For a blind on indirect cost, where there's still on these stores and on around but but overall, we see that our expected cost at a steady state is is achievable on on track, which is in the range of depending on how to learn doors are done but on a process or is it the main.
On dryers for cost on that side of consumables are what the fuel for energy as we self generate it cyanide and on layer and a day they do.
Pricing, we've been able to achieve on on cyanide on and a few he's well within what was in our E.
No budgets.
Yes, absolutely.
Okay that sounds good UBS.
And I understand because the irrigation has been a little bit on C. unsteady, you due to the way the stacking configurations. It hasn't gone exactly the way you had originally planned is it.
Is it possible to give us a sense of recovery, though from the heap, how if that's tracking also the way you want it to.
Yes, as I mentioned, the leaching net Dixie something we're looking at care carefully.
We have the benefit that these there's little interference with these initial sales as there is nothing stark on top of them and ER day. They percolation is quite a rapid right solution for correlation to irrigation there.
The cycle.
It is quite right because these are the sales closest to the plastic right to the bottom line. So.
And we also have or color on test to control it.
What's happening at and.
We got to report is a day leaching curves are performing according to our expectations remember that.
We are currently placing corsair or they were you know the sign calls for we're placing more at a b 80 of around 35 millimeters.
Hey, what would be signed these nine millimeters.
It.
But we have done day column tests and have done or a pro you actions based on these coarser crush.
And we expect.
Two he asked about.
50 per cent recovery within 90 days and that's where we are tracking in the initial sales we did have some issues.
There are also more operational we've had a veto funded funding.
In one of the sales.
Okay.
We are after stacking.
Starting with trucks, we are.
Before we start to irrigation we.
We prepare the ground no we work they first there 30 centimeters.
We have to go a bit deeper.
It due to a you know traffic on trucks, we have to low I'd be deeper and once we did that the problem just went away.
So you know.
And then we have some clogging of Ah fives to because of the dosage of react on is that we use in order to avoid it position on a car when it's in the pipes.
You know that's all of those on Nishu that was identified on quickly addressed but you know just normal stuff that you see through through a ramp up in a new operation.
And the programs are being managed leaching can ethics or trucking, a a along with our expectations you're solving these issues and with reason the respect to the speed at which we can incorporate new areas on their irrigation, yes, we have made an adjustment.
In our forecast.
Yeah.
We are not able with day, we were not able to implement.
Hey, retreat stacking, which would allow for allow us.
To.
Bring in irrigation I'd on March faster pace, we are a stocking with drugs.
In a in than that in on that balance, noting retreat and also we need to wait until the sales is complete and when.
And that's when we can start to irrigate so that takes away the speed at which we can bring new ounces on the irrigation. This is a temporary issue.
Related to the fact that we're stacking we trucks a week or this week, we started working with the conveyor stockers on these broader than just goes away. We convey your second which is beside for retreat stacking right.
Yeah no understood.
Maybe one just very simple last question for Luis and that is.
With respect to those that recovery any sense of kind of how that how you expect that to play out.
Yes, we expect to start.
Collecting the 80 as soon as we.
We started to selling as for as I mentioned, we had our first sale in November.
And based on on the existing.
Regulation on the amounts we are able to collect as a percentage of sales every month.
Our expectation is that within 12 on 14 months, we should be expect to it we should be able to expect to collect the full amount in pesos, let's oh.
You might be aware you the collection is in local currency.
So that's the timeframe on travel.
Perfect. Okay. Thanks, guys, that's all I had.
Mr. Turnbull. Thank you for your question.
Next we'll hear from Chris Thompson Financial. Please go ahead. Your line is open.
Hey, guys just.
Just thanks for taking my questions.
Just looking at the pictures it looks like a great place to build a mine.
Couple of quick questions here.
You mentioned that you are allowing for additional time to fully.
Take I guess, the H.P.G., a agglomeration stacking systems to commercial so it's that's built into the the the timeframe you anticipate for first commercial production in Q1.
We are really on PC faded increase too.
You have to place about half a million.
Ponds for.
Oh for crushed ore on the Leach car crash, then agglomerated or on the Leach pad in December.
We are reducing that oh on edge down to about 320000 stones.
Daddy's accounting for what we are.
It per yaseen would be a more realistic based on their limitations that we're facing.
A we de Sac costs for the environment right now.
And as I expected that flow for People's supervision technical assistance.
So you know how it easily the commissioning.
Okay.
Sometimes he just goes very well on small and sometimes it gives you a veto grief.
So in this for because we're taking a beautiful more conservative position with respect to act on it we have not translated that into the first quarter of this year.
Okay.
You know certainly something we are monitoring.
Okay.
If there is our expectation is to be do they then we should be in a position early in Q1.
To be achieving.
Yeah about half a million ounces so for placed on the Leach pad every month right.
We gave before incorporating before incorporating or.
The the H.B.R. and conveyor second we were already close to that rate.
Yeah.
Of production right.
Net.
Right could you just what do you need to achieve.
It ticked the box by way of commercial production, maybe you could just remind us of that.
No I think we would like to see a day.
ER mechanical aspects of the operation.
Yeah, Weve seen 85% of Ah decide.
No.
Again, the the first the mine is operating at day. These high rate primary and secondary crushing had been operating GAAP you know within that.
A range of efficiency some for DVT, we just need to be able to sustain it.
A on now we need to incorporate this last part of the train with respect to the metallurgical performance on.
The end of a day event that already got performance is what he will be.
But vicki net leaching kinetics are tracking according to our expectations. So far on the a the our plant and we also had some early issues with day ability to bring temperature in the cauldrons up to the sign those issues have been so low.
He leaves a the arteries odd or close to the same for I'm. It there so I think the.
The main thing is to see day. These last a portion of the crushing system.
You mean on how the entire drain from primary crushing all the way through the stocking is delivering on the with our around 900 ER and bonds.
Bonds for our right.
Right right Okay.
Okay, I'm just going just moving on just chatting about grade I guess placed at the moment. So when do you anticipate being in a position to to place.
So to increase the grade two to expectations on the pad.
No we are delivering the grade if you look at the aggregate.
Were behind but the only reason why we are behind in the aggregate.
Is it because.
In the early start.
Oh the crushing.
We did not have.
Because of their social distancing guidelines.
We didn't have room in the comp.
To accommodate their operations work force. So what we were moving where we were feeding the mill with day medium low grade stockpile, we were feeling that plan with a medium low grade stockpile.
Yeah. So on on on the aggregate, that's what's weighing down on us achieving.
On the sign or planned grades, but as I said negotiations trucking well and that was an issue related to the first month or two months of.
Initial production and ER.
Or operations are they leaving the great.
I don't see an issue there.
So okay. So each day. So you are you on stacking.
0.9.
Gram per ton right now on the pads.
Yeah, Hi go by today's reported 1.2 non.
No I mean, we're tracking with expectations here.
All right. Thank you for that.
And then just just flipping gears a little bit just said as a I wonder if you could just update us on obviously there was news last year related to the Royal royalty disagreement.
With the government.
Any developments on that front.
Yeah.
Nothing.
New.
Just as a recap.
On the KCC incur in court, we have been granted a stay on execution by the court.
So protecting us from any intention to collect the royalty on.
On the part of the secretary of mice.
On the cases in court.
It's good for the.
The volume and could be that we have some indeed.
Indications that we might see a ruling on first instance.
It faster than we originally anticipated.
We were expecting these Ah would take several months to get resolved on first the instance.
On the latest news that ER eightys for Hubspots he wants to see a ruling before the end of this year.
A.
I ruling would be a ruling on first instance.
That any of the parties can appeal.
And ER, Inc.
That is the case or stay of execution for takes the company through all their feeling appeal process as well no.
So they I think they only change could be perhaps is that there are some indications that we could see a ruling on for Ses instance, faster than already on the N. TCP.
Great. Thank you. Thank you.
Mr. Thompson. Thank you for your question.
Ladies and gentlemen, as a reminder, that is star and one on your telephone keypad. If you would like to ask for life question next we'll hear from an individual investor Mr. Jason alone. He. Please go ahead, Sir your line is open.
Yes, you boys are doing a good job I noticed here on Becker Best Canada. They have you know the company valued at $16.62 per share Canadian and the last question. Just wondering if Warren Buffett is interested in taking a large position. Thank you very much.
No I, we have no relation with the that the banking cows. So we all know that coverage on.
The last I heard wiring is not interested in they kept positioning for growth.
Oh.
Thank you for your question, Jason next we'll hear from Garrett Goggin with silver stock analysts.
Hey, guys. Thanks for taking my question a lot I had questions about Lindero, how were looking on 2021 and through the end of this year, but I I guess, we went over them pretty clearly.
I guess my second ones would be Argentina. The capital controls you know what was it there was on about 106, no I think you get out before a capital Charles Kit. Then you know does that change at all and can you discuss that please louise.
Yeah, I I can give a quick introduction that's on a yes. There there is we all know a capital controls.
Or or restrictions on access to exchange rate it.
Dollar exchange rate.
Argentina or plan.
Yeah, we have a repatriation plan in place.
On a considering all the current restriction on certain limitations in place by the government on our repatriation plan is not in fact, it for the better part of 2021 by any of these measures because the structures, we used and and Ah Ah.
<unk>.
Contribute a funding to lean day to reset on are you on that they'll do do even more precise.
For we should be fine for the first $120 million to $130 million or we should be able to.
Repatriate.
The directly out of sales proceeds without having to bring those funds back into the country again under the intercompany debt structure that we have in place.
On this particular component component of Ah or their company that is out of the scope of the existing restrictions today I'm on the sort of I mentioned that should cover us for the first time, we expect at least on nine to eight months of a 2021.
Right right, yes, that's well, okay. So that gives us a little insight into lindero outlook for 2021 as well if you look at the cash flow of it.
Yes.
Yeah, Okay all.
All right that's great I appreciate it thanks for answering my question.
Thank you. Thank you Garrett.
Gentlemen, once again that is star and one on your telephone keypad, if youd like to ask for life question. We'll hear next from Ryan Thompson at BMO. Please go ahead.
Yeah, I was actually going to be a same question on the last caller, but maybe on the thoughts got another one.
I mean in Argentina that there was the export tax net means reintroduced I think it was last year at some point on that there was talk of that export tax that's actually going away at some point for can you maybe just a comment on on.
Things are on tax.
When it comes up.
He asked for tax day.
He is currently at 8%.
For gold or products.
And Ryan and ER in our particular case, we have a tax liability treatment.
Green effect stability agreement.
That's a that's fixes that at about 5%.
Okay, but that's something that in underage andina in.
A loss you claim after you close the exercise for the year no flow in March.
We're not planning to planning to claim back anything for 2020. So our plan right now is that for pay 21, which would include 2020, we will star there for us is to claim and the difference.
In Argentina, it works a bit different than in other countries like they do for example, where we also have a stability agreements starts every day agreements.
The net.
On like Peru, 90 day, you have to.
They fix the total amount of your tax burden, you know weight and ER.
Looking at.
All their Doc so.
Components of the total effects for them if they look at the total amount on see if there is a gain or a loss and then you are you can claim that difference right. It always is different it works by what you for fixed in terms of the IR or.
Sorry.
Income tax or the royalty itself.
But.
We plan to see if there is a difference in 2021 and then claim in back through 2022 right.
Thank you.
And ladies and gentlemen that does conclude our culinary session for today's call I'm pleased to turn the for back to the leadership team for Fortuna and Mr. Carlos Baca.
Thank you Jim we would like to thank everyone for listening to todays earnings call and look forward to you joining us next quarter have a good and for the year Bye.
[music].