Q4 2020 Fortuna Silver Mines Inc Earnings Call
[music].
Good morning, ladies and gentlemen, and welcome to the Fortuna Silver mines fourth quarter, and full year 2020 financial and operational results.
At this time, all participants have been placed on a listen only mode and we will open the floor for your questions and comments. After the presentation. It is now my pleasure to turn the floor over to your host Carlos Baca.
Sir the floor is yours.
Thank you Matthew.
Good morning, ladies and gentlemen, I would like to welcome you to Fortuna silver mines and to our financial and operations results call for the fourth quarter and full year 2022 the.
We'll be using a webcast presentation, which will be controlled by us.
The presentation. Please go to our website at Fortuna silver of Dot com click on the investors tab then on the.
The actual sucked up in on their Q4 2020 click on the earnings call presentation link.
And also of prescient, CEO and director and Luis.
And also our CFO will be hosting the call.
For I turn over the call to Jorge.
Like to indicate that this earnings call contains forward looking for me front that is based on the company's current expectations estimates and beliefs.
These forward looking information is subject to a number of risks uncertainties and other factors actual results could differ materially from a conclusion forecast or projection in the forward looking information certain material factors or assumptions.
Were applied in drawing a conclusion or making a forecast or projection as reflected in the forward looking information additional information about the material factors that could cause actual results to differ materially from the conclusion forecast or projection in the forward looking information and the material factors for us.
Samsung, but were applied in drawing a conclusion or making a forecast or projection as reflected in the forward looking information is contained in the company's annual information form and MD&A, which are publicly available on SEDAR. The company assumes no obligation to update such forward looking information.
In the future except as required by law.
Now like to turn the call over to Jorge on the medical I know.
Cofounder of Fortuna.
Okay.
Thank you Carlos.
Good morning tool.
Yeah.
We will.
Thank you through our results for the quarter on on year end.
With the aid of the cause of this.
Slide presentation Carlos mentioned before so we can go on to slide five the presentation.
Yes.
Through our work over the last.
Three years, we have come to place ourselves in the most exciting position today as we are the leader in significant growth in the Gulf production in a rising pretty sure Tomatoes Mark.
This year for <unk>.
Some guidance for more three mines is in the range of 260000 to 300000 gold equivalent ounces, an increase of 80% to 100% over 20 between.
Next slide please.
On the highlights for the quarter.
We have reported record breaking free cash flow of $34 5 million on our business operates with a robust adjusted EBITDA margin of 43 per se.
We have strong liquidity of 132 million with net debt of 34 million net debt to EBITDA ratio of.
For the.
We expect to be net cash positive again this year.
In the general production on first lien debt of prisons first of all in October 2020 on the lyrics 13th Towson.
435 ounces in the fourth quarter as part of commissioning and ramp of activity.
During this ramp up of quarter and there was cash positive generating approximately $5 million in free cash with an all in sustaining cost under 11 out of the builder.
Ramp up to the same capacity continues during Q1 of this year.
During this unprecedented year for operations suffered a temporary suspension of production for.
The San Jose Mine in Mexico was down for 50 for these carryover of my.
In Peru.
For the down for 21 days kind of in their construction activities were suspended.
For almost three months considering reorganization the.
Company was quick to implement containment measures for COVID-19 across all sites mitigating the risks to our people.
<unk> welcome.
With rapidly changing government regulations and guidelines on ensuring business continuity.
Where the rig cost attributable to managing the COVID-19 risks across all sites amounted to $4 million in the year.
Moving on to slide seven.
We're listening to our shareholders and stakeholders in general.
We're not only improving our reporting on ESG, but undergoing a cultural change of the way, we incorporate sustainability of our strategy and business planning.
Through rigorous materiality assessments.
We're prioritizing our efforts.
The journey of continuous improvement.
Strength in governance, that's evidenced by the rating agencies and areas of improvement in taking longer term views on the environment and social.
We're committed to show Fortuna as our strong ESG per floor.
Next slide please.
On slide eight of the presentation.
We share of key safety performance indicators, we present kpis of 12 months rolling average to better represent trends.
For trend of improvement over the last year's worth of truncated by the challenges imposed by Covid.
Particularly on the second half of 2020.
In the last months of the year, we experienced a spike in total recordable incidents and lost time injuries.
Covid restrictions, particularly of the San Jose mine and startup of operations of Lean Natal explained the poor performance high rotation of personnel due to the.
Covid.
The contact tracing.
On the.
Incidents of.
Suspect cases and in the ability to mobilize experienced operators on supervisors, Argentina due to the closing of the borders before in the weighted heavily on these results I can share that for the start of 2021, we're seeing material improvements in.
Performance in many of the middleman.
While some challenges remain the San Jose.
Okay.
Yes.
With respect to production for the quarter silver production was down against the comparable quarter as a result of lower grades at the San Jose mine, 17% lower grades.
On a go.
That's up 100% due to the contribution of <unk>.
The gold.
Production from the data.
The next slide please.
For the year.
Silver production was down 19%, mainly driven by the 50 for the use of suspension of production at San Jose on the impact of lower grades.
Gold was up 10% of the back of the data contribution to corruption as I mentioned in the fourth quarter.
Next slide please.
Sales.
In the first quarter silver to silver and gold kind of on almost equal contribution to sales of 40% to 45% and we capture in our sales and margins the benefit of increased prices for both silver and gold.
We sold silver in the quarter at a price of 20 for the owners of <unk> 40 per ounce of gold at the price of.
1860 for the others.
Sales in the quarter jumped 50% of $103 million for EBITDA jumped 48% to $45 million on our adjusted net income.
111% to $23 million for 12 cents per share.
The next slide please.
For the year.
We reported sales of $280 million.
On a very healthy EBITDA of $112 million with a margin of 40%.
Our cost.
Were impacted from the all in sustaining perspective from the lower production.
Silver at the San Jose Mine as a result of the shutdown and then on lower grades.
<unk>.
Okay.
Or cut costs were impacted also by current.
The.
The only see ratios with base metals.
Next slide please.
Okay.
We have concluded.
In 2020 capital intensity of face.
Debt, we had embarked on for the last three years.
The construction of.
These are over.
The.
We are in the commissioning and ramp up phase.
And.
Our capex budgets are expect are trending now and are within the balance of our sustainability investments at all three sites.
We are re energizing also exploration.
Looking forward and we provided the C. We share this in our guidance we are reenergizing our budgets on.
On the exploration.
Traditionally been investing.
Up until 2017, approximately 4% of sales on.
On exploration on them.
Having but.
Really meet their age of.
Always in excess of 30000 meters.
As a.
In 2020, our exploration budget was the low $8 million.
We drilled eight 8000 the sorry.
<unk> drilling meters was the low 8000 meters.
The.
As a percent of percentage of sales of our investments on exploration.
The 2% of sales.
For 2021.
We are taking our exploration budgets Buckeye game.
To a level of around four 5% of sales of drilling Meterage is being expanded.
The two in excess of 40000 meters a year that each of the kind of meterage and the exploration investment we need to.
Not only of replenish.
Serves resources, but also expand it so in 2021.
Exploration is of topical issue.
For us.
And.
You are going to see expanded investment on exploration now that the capital intensity of face of the better construction of needs to be high.
Next slide please.
Okay.
With respect to ore.
Activities in the network.
Yes.
The way of update as at the end of February.
The horror.
The mining unit operations settling data.
Our operating and delivering according to the siding capacity.
Of our ADR plant has been now for several months operating.
At designed capacity, taking the food for 100 cubic meters per hour.
The of pregnant solution on.
Achieving and called the fractions.
And the range of 90%.
Primary and secondary crushing.
The sick, which as of the end of.
February are operating in 67% of design capacity and.
This.
Months' of March we're already seeing.
The solid days.
At $10 85 with.
Within 85% of the signed capacity.
At the HPE era agglomeration and stacking.
We are at 23% of design capacity here, the limiting factor has been the stacking system.
We have been.
Dealing with the.
The operating in.
Hmm.
Seating issues at the stacking system.
But I kind of advance that are already in and in these early days of March.
We're seeing the performance.
Improving and closer.
Solid day closer to 30, 40% of the same campus.
So all in all we're seeing a strong.
Strong trend.
In the right.
The erection.
And.
We are expecting continued to to expect.
Material advances on the ramp up this month of March as we implement several measures on.
Corrective measurements measures on the lot of the components of the cross right but.
But most importantly, all of these things are issues, we can address on correct.
But.
The core or models for our reserve models of conciliating extremely well against production on our leaching kinetics gold leaching kinetics are performing according towards the sign parameters on expectations.
Our two things the one.
On the highlight and also the fact that as I had mentioned before we are trending in the right direction.
With respect to our expectations on ramp up we're still.
Slightly behind somewhat behind on of the stacking, but were seeing solid improvement in March.
Slide please.
I think this is the.
The end.
Oh my.
Have the on the presentation and I'll pass it onto the Luis who you view of the highlights of the financial results.
Yes, thank you for.
For him.
No.
On slide.
18.
Yes. It has been discussed the ready by quarter here, we had a strong fourth quarter driven by.
The higher sales of 50% over Q4 2019, our margins were.
Significantly up reflected in adjusted EBITDA on adjusted net income increases of 38 on the 100% respectively.
Net income however was slightly below for 2019 due to certain items below the operating income line contributing to a higher net income in the comparative period of 2019, specifically in 2019, we recorded $11 million of investment.
Gain on the large inc.
For tax credit related to foreign currency fluctuations.
Slide 19 please.
So in the.
In the quarter of the highest impact on our sales came from both the higher metal prices of silver in particular, which was up 41% on.
On.
As for as I mentioned, the contribution of pretty narrow with $23 million for the door up for a total increase in sales of $34 five.
Yeah.
The company elected to early adopt.
Sort of an amendment to Ias 16.
Which deal with the first.
Of course heat for intended use of assets.
Under this amended standard the company is required to recognize sales proceeds and related cost of items for those.
In the income statement, while the company is preparing the asset for its intended use.
Next slide please slide 20.
So.
Reinforcing of it of what color can its cost when looking at our compared to the segment. The results you guys up significantly quarter over quarter on both the San Jose mines, reflecting the positive impact of higher metal prices for experience.
Scott.
Our production cash cost at both operations in Q4 remains at similar levels as the comparative quarter.
On this overall within the ranges we expect for 2021 based on our guidance all in sustaining cost at San Jose was $14 $50 per day.
Equivalent ounces of silver for the quarter on $12 for the year again based on guidance provided for 2021, we expect all in sustaining cost to remain within the within the similar range of $12 14 $50.
For the equivalent ounce of silver in 2020 one.
Slide 21 please.
Okay.
Yes.
On slide 21, we provide some additional detail on a reported the NATO results.
Because of some of our.
Does the $23 million of sales contribution of cash cost of sales shown.
And the table correspond to the full operating cost in the quarter.
The only item of in country cost and expenses that is not yet reflected in the income statement in Q4 is the off site.
The DNA of $1 $1 million.
The total net of contribution to our consolidated EBITDA was $11 $3 million in the quarter.
Also relevant to know we have incurred export duties of 8%.
Nominal range over sales, which we expect to continue into 2020 one.
Next slide please slide 22.
Yes here we.
We show.
The the breakdown of our general and administration line item out of the financial statements for the quarter and the year for the full year of corporate and in country G&A expenses are below 2019.
The increase in total DNA, both for the quarter on the year is related to higher share based payments related mainly to the performance of our share price.
Sure.
As shown on the slide as well we recorded for.
Foreign exchange loss for the quarter of for $7 million on $12 $2 million for the year driver of these losses as has been discussed in the.
<unk>.
Is that construction the A&P receivable in Argentina.
In 2019, we incurred a loss of 10 minutes or similar magnitude, which.
Cumulatively in the two year period, except for approximately $24 million. This however.
In the prior said being mitigated by investment gains of $3 $3 million in 2020.
Around $10 million in 2019, so cumulatively the net loss.
It's more on the range of $10 million.
It is worth noting that we have already started recovering of the IP, we'd have current lump sum amount of $10 million collected in January and screening for anyone.
And the next slide please slide 23.
Yes here we are.
We provide a summary of our balance sheet on liquidity position on the bar graph on the left at the edge.
End of.
Q4, 2020, our total liquidity of came down slightly with respect to Q3.
$150 million of bank facility.
Scale down to $120 million as was contractually scheduled.
Worth, noting our net debt position is shown at the bottom improved from $56 million.
Q3, two of $34 million in Q4.
With that I will hand, it back to you Carlos Thank you.
Thank you.
Thank you Luis we would now like to turn the call over to any questions that you may have.
Certainly ladies and gentlemen, the floor is now open for questions. If you have any questions or comments. Please press star one on your phone at this time.
We do ask the while posing your question. Please pickup your handset if you're listening on speaker phone to provide optimum sound quality.
Once again, if you have any questions or comments. Please press star one on your phone.
Please hold while the pull for questions.
Your first question is coming from Don Demarco Your line is live.
Thanks, so much for taking my call.
Jorge So you mentioned the stacking system I've read the does that 23% in February.
Performance, increasing to 30% to 40% in March.
Well, what kind of level would you be comfortable with in order to meet the guidance in 2021.
Thank you for the question the <unk>.
Is it the.
Important to stress something that we try to describe well in the MD&A, which is the.
We are.
Bypassing.
Whatever John inch or extract ounces, we are not placing with the stacking.
System, we're making up with the placing ore on the leach pad the wheat trucks.
Hello.
So what we are tracking is the amount of extract of allowances that we placed on the leach pad.
Free months right.
So we are meeting the extract of analysis on the Leach pad.
Hospira guidance.
And.
The issue is that the ounces that we place on the with the stacking system.
We expect.
Gold extraction to be in the range of 75%, 78% over 90 days.
With the ounces that we place with trucks as they are a bypass debt.
Comps from the when we draw from the.
Secondary crusher stockpile.
The decrease of 34 millimeter crush.
And for that kind of crushed material that <unk> 74 millimeters.
The extraction is more in the range of 50%.
Over 90 days old.
Over time, we will.
The achieve higher extraction rate.
Not on the 75, but certainly higher than 50 overtime. So we're having to place more ounces.
And to meet the.
The guidance now more ounces in the leach pad to meet the guidance. So that's how we're managing this as a temporary solution while the.
We get the stacking system up to the side right.
What I said during the call is that in these early day so March.
We're already seeing the spec.
<unk> been performing at.
Between 30, and 40% we had yesterday of the good day with 90000 tonnes per day, which is more of like 50%.
Of.
Of capacity.
No.
We are dealing with.
Yeah.
Some of them.
Some of it.
Sure My notes.
Issues with the stocking is mainly the.
The overland conveyor braking system.
Malfunctions no debt.
Generate massive speedway is basically the domain on the system of the.
The stacking system is not communicating broker in the at all times.
The.
Maybe.
Yes.
More testing, what's happening and we get it working and then we sort of a miscommunication on.
On the end of routine piece of the work in zinc cost.
Thanks, we get massive steel ages for one of these large conveyor belts right that takes up to five hours to clean up and get it on private day.
So nothing that we.
And just to complement here I believe that the for example of this is a good example of how Covid is impacting us.
I believe this issue could be resolved in a matter of days or weeks.
The.
Even hours.
The issue is that we do not have the benefit of having the vendor technicians on site working with our operators on maintenance team right.
We're making good use of technology.
But he is not the same so a lot of these issues.
Improving getting the other mechanical availability.
But I think the things that they really could take hours or they used the result end up taking days or weeks, because we just don't have the the.
The something that.
You won't see on the normal day, which is the ramp of the vendor of technicians.
On site with you right in this case the superior.
The the Argentinian borders are remain largely closed to foreigners. So we cannot get the the technicians in country.
Yeah.
Okay, Okay, well thanks for that.
Also on stacking, but may be shifting over to grade I recall around mid October.
On the initial grades that you had stacked for a little bit below like maybe <unk> eight three grams per ton or something you.
You had previously maybe been targeting one above one but now I see that the the grade stacked grades.
For the Inc. For the full year are one gram per tonne, which implies there's been an increase in the stack rate are you comfortable with.
The grade that you're stacking right now and is it in line with your expectations on plan.
Yeah, Great is in line with our plan.
Absolutely okay.
Okay, and then finally on capital allocation priorities, we have new generating a lot of free cash flow. In 2021, you mentioned you have expanded investment on exploration.
Is the dividend something that Youre thinking about at this point on repaying the debt what are your capital allocation priorities beyond the investment.
Exploration.
Yes.
Thanks for the question because it allows me to point something here, we have three priority of seasonal ones for.
We believe at times like these companies.
When companies need to strengthen the balance sheet right. These are the opportunities we have in.
And the cycles like the likes of the cycles that we are now to strengthen the balance sheet. So we view it.
Having putting together a fortress balance sheet.
Parity for US right, so thats number even though our debt to EBITDA is low and whatnot.
The.
You will be seeing this.
Yeah.
Ensuring that we come out of this leg of the cycle with a very strong balance sheet second.
Second is exploration.
<unk>.
As I noted.
During the <unk>.
The intervention before.
Moving on short changing or investments on the exploration for.
Three years for patients because we were prioritizing capital allocation tool in the other construction.
The.
We have been drilling.
2020 of only 8000 meters not enough to replenish deal with depletion at our mines.
On the reserves. So we got those drilling meters is up north of 40000 meters.
The quarter drilling on at all sites, we have on new initiatives outside of the brownfields, we're going to be drill testing of this year as well in Mexico on one in Argentina.
The.
The last piece.
Returning to shareholders.
Yes, that's something that we will consider the best way to return to shareholders and we will evaluate those options.
Against the other opportunities for growth that we might identify on.
The.
But certainly.
Returning capital to shareholders.
In the way of DVA and sort of special leave you the end or.
Or other means.
Is something that the board is considering norbert.
Okay.
That answers my question. Thank you for that.
Thank you. Your next question is coming from James Huntington. Your line is live.
Yeah, Hi, guys. Thanks for taking my questions.
Just for following up from.
The previous questions on the stacking on what's sort.
The card law on just that your current rights.
You could be ramped up on the stacking system.
Unfortunately, COVID-19, obviously of restricting you said that there, but do you think this would be like of two months price. So sort of you would be like 90% of the way by the end of March just a bit more color the thanks.
Yes.
That's a tricky question to answer.
We have.
Or problems.
Our.
With the stacking.
Our isolated right now to the braking system to the communications on the braking system until now to May trend issue.
We've been training a lot of things on solving problems on improving and now we're left with this one.
And if you know how these works.
You all of us out of them.
Get it right and you get a bump on on performance.
Performance.
And.
We're already starting to see better days.
On all of a sudden we can see significant jumping.
And the performance.
Okay.
You know we're almost at the mid March So you know its dealer expectations to get within the 85 per cent in performance in March.
But if not we'll see of spillage into April right and.
But it's difficult.
For me to gauge I believe the issues are you choose that better solve the matter of days or weeks, what we have in front of us with the stacking of something that we should be so.
Other of days or weeks not months right.
Alright.
Because of the nature of the problem on where we are with the solution also some of my best the salesmen would.
<unk> day.
As for weeks.
To get this program just this one program right now we're battling with and we have been battling with four of them.
For for a few weeks of outright so I believe we're on the on.
On the last leg of a solution for the price.
B.
Okay. Thank you very much for that and then just if you could give us some color on the ramp up of disk.
Status of the plant.
And sort of what how the ramp up of scaling there as well.
Yes, the the.
The third plant is not critical path.
For us this is important we need the sarcolemma, but we don't needed to produce gold we don't needed in day, one right. So the copper.
The content in the pregnant solution to narrow is manageable.
We have a mortgage.
The third plant in February was of 37 per cent of design capacity, but.
We have reallocated our resources.
The from the maintenance team and operations team.
To the areas of the arc.
T.
Of our on critical path for the Gulf production basically the stocking on the crushing system.
So we have de prioritized.
Efforts around the <unk>, we will come back to it once we got that stacking system running where we needed to.
He is the hard plant.
We've been running it at their own 37% up to 40% of the same capacity.
It's been operating efficiently adult rates, we've been able to precipitate you know 80 90 per cent of the corporate solutions. So the.
Again, the history of the <unk> performing.
I will say in exceeding our expectations.
It's just a matter of increasing flow.
Right now we have a.
Nishu with the copper filter.
We're waiting.
The they come on.
The.
For the small repair on the corporate share on the corporate filter.
Yeah of minor issue on and but again, we have prioritized resources to critical path, which is basically the stacking on primary and secondary.
For <unk>.
Yeah.
Okay. Thank you very much for that and then just one last modeling question for from.
For.
For the depreciation has been debt right could you guide us what you're sort of expecting this year.
Unlike of dollar per ounce for Linda.
And if possible of more longer term value.
Luis you want out of you a bump to the skin.
Yes, I heard you're asking for the appreciation dollars per ounce eye.
We're using the units of production method based on the ounces.
The loose I don't have unfortunately, a number.
My head that I can share with you, but the what we should expect a square of depreciating based on on the ounces a per ounce basis is of course is the.
The depreciation tracking of course, the the production output swell of the life of mine right.
So that will be in sync with.
The evolution of <unk>.
Of the income 12 of the life of mine.
Yes, I'm, sorry, I can't give you a number right now and so on.
The economy.
Okay. Thank you very much that's all from.
Thank you.
Yeah.
Thank you. Your next question is coming from Adrian Day. Your line is live.
Yeah, Hi. Thank you. My question was partly be non said already in one of your previous answers, but I I wanted to ask you about the exploration of a little bit more.
Maybe the foreseeable future is it all exploration at or close to mine site all of their any.
New new areas Youre looking at.
Yes.
Yeah.
And kind of a video of Ericsson.
Adrian.
Yeah.
At the San Jose mine.
In Mexico, we have on our aggressive for.
Program or drilling program.
In the immediate vicinity of the mine.
Both on the north of <unk>.
Roundly of existing resources.
On the deep extensions on to the south.
We have identified also for kilometers sorry, 400 meters due east from the main ore shoot.
The two parallel structures won the two the hosts resources, the Victoria vein, where we have done no.
Being up to now and then of reap further east from Victoria, and we have also a couple of interesting drill intercepts of another blind structure.
The with grades in the range of island on 35 grams of where.
For a couple of meters. So are we.
Mike.
A lot of drilling allocated to debt.
In addition, ADESA Jose mine, we are exploring.
The other areas.
Other veins within the system.
But I would consider all of these in the within.
We have a reach of brownfields and also the opportunity of that where we if we are successful we could.
Have the opportunity to truck or to or San Jose of meal.
We signed this year, a 2020 and in the agreement with the now room, we have option on the Eagle.
The per day.
Some of <unk>.
<unk> 15, 20 kilometers due east from San Jose for an exciting exploration project.
With some exciting.
The drill results that need to follow up.
And that's the information is public.
Corporate of you can look at it.
So you know all of the CS within our plans for 2021 in the case of the Tayo in my mind. The we have a also a similar scenario of drilling within.
The the extensions of known mineralization and also.
The.
And now into new areas of testing new ideas in the vein system that hasnt been so prolonged the steep for over 500 years later.
So in the case of using data.
The.
We are not doing.
Mir mine near the resource.
Debt drilling, where we are stepping out to the ITC of I'd be saddled gold porphyry, we're gonna be drilling.
These first couple of of the year on.
Decided on his.
Gulfport free ease of as I said second Gulfport Free center.
In our broker dealer in the.
There always is.
<unk> that we're bringing.
Brought into production and they decided is located three five kilometers from lean data so well within trucking distance there is.
Well identify the gold porphyry system, there that has received drilling throughout the years.
The one day, we believe there is potential as evidenced by past drilling.
For the near surface high grade satellite.
Perhaps not too big.
But as we have of infrastructure. So close we don't need of stand alone. So.
The satellites.
Good contribute what 5 million 10 million 20 million tons.
At the grades in excess of point for 0.5 grams.
And goal, we believe price 0.7 of some drilling would suggest so we're gonna be testing in.
Those potential satellites.
Adhesive.
So apart from that we have drilling you know.
In a new project in Mexico on Argentina.
The exploration, we have option properties on where we're advancing work and work advances.
We firmer commitments on those projects will be discussing the public right.
Okay.
Super Thank you got it.
Okay.
Thank you. Your next question is coming from Justin Stevens Your line is live.
Thanks, guys yeah.
Most of what I wanted to get the already been covered off on.
Wondering.
How much the copper you guys seeing so far.
That lend narrow and on the flip side of that would be of how's the cyanide consumption relative to what you were looking for.
Sorry I E.
We didn't hear you all did well you were asking about the the copper content.
In the in the ore placed so far at Linde Darrow and the the cyanide consumption as well.
Yes.
The copper is copper grades are trending along with the.
The what we see in our resource we serve model of our own 0.1% copper is what we're seeing.
And the in the case of of indeed of what makes clean data of viable technically viable is the fact that yeah.
95 per cent of that.
Copper.
The 0.1% copper that we see in the the NATO porphyry.
He's in the form of chalcopyrite.
So only.
5% of corporate Chalcopyrite leeches on their 80 cyanide solution. So it doesn't eat the.
Cyanide Lake gold or copper mineral of farms like golf course sign where you know 70 per cent of copper will leach.
In the mineral form of Calico calico assign chalcocite calculus.
The corporate line.
And our board of night no those are the cyanide eaters.
In the case of a little you know we have chalcopyrite on.
On the grade of copper is within our expectations of the 0.1.
The our cyanide consumption right now is slightly below half of AR.
The 0.5 kilos per ton.
Yeah.
So.
You know, it's tracking well within what we expect and the copper that we're seeing in the pregnant solution. It's also would mean would we would expect our with diesel leaching kinetics. So.
We're seeing copper in the range of four to 500 ppm in the pregnant solution. So we're managing that with the and.
Cyanide.
And the you know the the start blended the old always running a 30, 40% of design capacity is doing.
The work alright.
Yeah, no that's great.
And then the only other question I had was you guys of timing for them.
Planned annual reserve and resource update.
Yes, we'll be releasing of reserves resources.
In the coming weeks.
Great.
Alright, that's it for me thanks.
Thank you there are no further questions in the queue at this time.
Okay.
Yeah.
Yeah.
Thank you Matthew of there are no further questions I would like to thank everyone for listening to today's earnings call and we look forward to you of joining us next.
Next quarter, how big of a day.
Thank you ladies and gentlemen, this does conclude today's conference call. You may disconnect. Your phone lines at this time and have a wonderful day. Thank you for your participation.