Q3 2022 Compania de Minas Buenaventura SAA Earnings Call

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Good day, ladies and gentlemen, and welcome to the company or de Minas Buenaventura third quarter 2022 earnings Conference call.

At this time all participants are in a listen only mode and please note that this event is being recorded.

I would now like to introduce your host for today's call. Mr. Gabrielle sell us Investor Relations. Mr. <unk>. Please begin.

Good morning, everyone and thank you for giving US two eight to discuss our third quarter GDP the do it yourself.

My discussion will be led by Mr. Leandro Garcia Chief Executive Officer.

Also during our call today and available for your questions.

Chief Financial Officer.

On that list would be breakeven operations.

100, <unk> Vice president of sustainability.

I'm still not bad.

Mr Douglas.

Explorations money here.

Okay now you chairman.

Thank you Victor.

Before I turn our call over let me first touch on a few items.

On one hand, the rest of website you will find our press release that was posted yesterday.

Yesterday after market close please note that.

Today's remarks.

Forward looking statements that are based on management's current views and assumptions.

Management believes that its a function expectations on projections are reasonable in view of the currently available information you're cautioned not to place undue reliance on these forward looking statements I encourage you to read the full disclosure concerning forward looking statements within the press release.

We filed on Thursday.

Thank you Betty.

Let me now turn the call.

Yeah.

Thank you Vivian.

Good morning, and thank you again.

Thank you.

Yes.

We are pleased with the center.

Okay.

Jamie.

Yeah, I mean, that's been on it.

So that's it.

Powerpoint presentation, which is available.

Right.

Before we go further please.

Take a moment to review the cautionary statement shown on slide two.

Yeah.

Moving on to slide three.

Highlights this quarter.

Third quarter 2018.

Yeah.

They go to Asia.

Okay.

Compared to 39 five.

Hello.

Reported in the third quarter 2021.

Hey, Bob.

Rich.

Yes.

$16 1 million.

Maintenance 454.

In the third quarter of 2012.

Third quarter 2021 operating cash flow.

Thank you.

USDA lifestyle, 44 2 million payment.

Thanks.

Third quarter net.

Net loss was $98 million compared.

Right.

$91 9 million net loss for the same period.

Sure.

Third quarter Duane.

Asia.

Operating units.

TB.

$27 million okay.

Seven.

Seven eight.

$1 million per quarter.

Joining me.

This increase is aligned with the company.

Yes, Doug.

We agreed its focus on exploration in order to extend our life of mine.

And it's also the exploration campaign.

Very good.

We are outlining how high it seems like maybe bullshit.

Indeed, there is a potential with choice and we don't know us.

Double.

Silver ounces decoupled.

When our impede us cash position reached $288 million.

About 80 20.

You bet.

Greece.

The $48 1 million.

We've done that.

Six yes.

Great.

Turning to capital expenditures were 37 2 million.

Sure.

$23 9 million for the same period in 2000 anymore.

Third quarter 2022 Capex includes.

$2 million.

Related to the San Gabriel project, and 777 3 million related to the gym.

Well so our children.

It sounds like where you are gradually resuming.

When they do that has therefore David.

Some of it and now with <unk>.

To reach approximately 65.

<unk> and 'twenty.

Moving on to slide number four.

ESG corporate compared the study.

Here you will find some indicators regarding our EOG has said.

We grew up.

Neither our carbon footprint.

All units.

As we announced in June .

With this we know.

Now how much Seo to regenerate our NEXAFED.

Develop a plan to review the full year.

Both can be found.

Our web site.

Moving on to slide five.

Our financial highlights.

During the third quarter was $195 million.

It's 11% lower in comparison to the third quarter.

The nine months of the year.

Total revenue decreased.

$578 million compared.

<unk> hundred $47 million during the nine months.

Sure.

As <unk> mentioned before however, the EBITDA from direct operations for the third quarter 2022 was $22 million less in comprising $39 million.

During the third quarter of 2000.

One <unk>.

From operations for the nine months of 2012 decreased to 90.

$6 million.

In comparison.

$45 million million.

During the first nine months of 2021.

These fields.

Again, I called checkpoint section.

Also our net loss for the third quarter of <unk> was $22 million in comparison.

94.

During the same period in 2013.

Yeah.

Net income for the Miss.

First nine months of the year.

$534 million compared to a net loss of $41 million for the same period in <unk>.

During the war.

The increase is explained by the NFL.

The capex increase to $37 million from the third quarter of 2022, okay.

$24 million and deferred corridor 20 kilowatts.

The first nine months of the year Capex totaled $93 million, a 60% increase in comparison to the first.

Nine months 12 months.

Yeah.

Moving on to slide six and seven our attributable production.

Total gold attributable production in the third quarter of 2012 to watch 56000.

People, some higher and Europe of the same quarter of the previous year.

This increase is mainly explained by the stable production from the Google IBM and Oracle and Oracle bump.

Partially offset by lower production at <unk>.

The first nine months of 2022.

Total gold attributable production.

Production was 153000 <unk>, 10% higher from the same period in 2021.

Attributable production for this quarter was one 7 million ounces, which shows a degree.

Reached 50% compared to the figure reported in the third quarter of 2000.

Me too.

During the first nine months of 2026.

She will be with oil production was 5 million or 49% lower than the first nine months of <unk>.

The decrease was mainly explained by node due to this expansion would you chalk bluffs operation as we previously announced.

And that change.

The mine planning sequence.

Right.

In the third quarter of 2000, 27000 metric tons of zinc would produce.

As compared to the third quarter in 2010.

First nine months of the year simple actually beach.

So any details on that the bonuses.

30% lower than the same period fairly similar.

In the case of lead equity production was around 4000 metric tons in the third quarter of 2022, which is.

28% lower in comparison to the third quarter of 2021, and the nine months of 2022 lead production was approximately so that was one.

<unk> 4000 metric tons.

SME.

During the same period, Australia somewhat.

Moving on to slide eight all in sustaining cost or <unk>.

A couple of details.

Bill needs within both from our direct operations.

In the first nine months of 2012 decreased by 12%.

1423, 24, you will rollout.

Yes.

The cost applicable to sales for the first nine months of 2020 were as follows.

For both.

And then $126 per ounce, which is 8% lower than a year ago.

<unk> 17, $65 per ounce, which is 10% lower than a year ago.

Okay.

1282 years, more or less per metric tonne.

Is 12% lower than a year ago.

Copper 6670 $5 million.

Paul.

6% higher in comparison to a year ago.

Finally, the agency, but also be double Tuesdays was rebalancing.

87, there was no loss per metric ton, which is 40% higher than a year.

Ago.

Yes.

Moving on to slide nine pipeline our pipeline is.

As an update.

Yes.

We are presenting one is snapshot.

Current development level for each one of our clubs.

Moving on to slide 10.

Engineering and procurement work Offsite activities.

<unk> made significant 45% and 77% respectively.

Total target for the project completion.

We see everybody reduces overall project uncertainty and potentially enabled a recovery of a portion of time loss related to this project.

Its targeted completion.

We estimate the Kraft commercial buildings.

We are doing.

In the third quarter.

2012.

Moving on to slide 11 by region.

We have finished the first set of one site volume diluted a bit.

Second said, Poland, 58, improving copper recovery and controlling acid consumption.

Environmental impact assessment, and social engagement work progressing as planned.

Thank you for your attention I will hand, the call. Once we were able to open the line for questions. Operator. Please go ahead. Thank you and we will now begin the question and answer session.

If you would like to ask a question. Please press Star then one on your telephone keypad. Please note that you may pick up may need to pick up the handset before pressing the keys.

To withdraw your question. Please press Star then two and we are proud of him and totally for the first question.

Okay.

And our first question today will come from Tanya <unk> with Scotiabank. Please go ahead.

Good morning, everybody.

Thanks, so much for taking my question.

Three questions I'd like to ask the first one is just on <unk> can you give us an update on where we are like in terms of actually physically starting construction.

Are we on the social issues.

Thats occurring have those been resolved and when do we actually start breaking ground.

My first question. Thank you.

Okay.

We entered a deal with the second and the third and then we said.

Okay.

My second question is that we have been hearing from other companies.

Easing of inflation pressures and the costs.

There's been a relief.

Fuel price has been a relief and that supply constraint semi seeing lower cyanide pricing and Containable steel I'm interested in what you are seeing in Peru in terms of your evening.

Any of these inflation pressures.

And then the last one which is for Daniel which is the easiest one is on Capex.

Should we still be modeling for 2022, one at 90 to 100 million in sustaining and now only $65 million I think everybody out previously it was a 100 to 105.

Those are my three questions.

Yeah.

Very much Danielle.

License.

As a market.

Sure.

As manager.

You are.

Hum.

Our strategy.

Then.

Yes.

Last one.

Number two months.

Great. Thank you.

Sure Hi, Tanya.

When we.

Let's start with this.

The issue with the Korea, we were kind of starting the.

The Preconstruction work.

Currently I would say that we are up 1% of construction.

We have resume our activities after finding a common one with most of the outside community and operators.

So.

Onsite work has already begun and we have we are we training the people from the nearby communities. So they can they can help us move these forward at a faster pace. So far we are that sort of start the process.

Okay.

I understood it.

Got it construction right now you're only 1% complete but youll start Ed and you've resolved the issues with the communities around that.

Your communities as they further communities.

You have resolved all of that.

Access to site, it's fine, yes, starting on that.

Yes, okay. So theres already work going on in the in this context.

Can I ask just remind me the critical milestones from today to Q1 2025, what are the critical milestone for me to look at for your construction of the site.

Towards the second half of <unk>.

Next year, we should have we.

Where should we start our concrete.

It did grow structural.

Work.

And then.

Late second quarter 2025, we should be producing our first of all about piece will be revised for another quarter.

Have been working on.

Without nonstop on engineering and procurement of weekend.

We cover so we won't be doing so probably another quarter.

I'm so sorry.

So next year second half of next year, you're going to start your concrete and structural work.

Yes.

Moving.

So we're just towards the second half we're going to have on our final outcome and thats. When we can bring most of the people to start construction for construction.

Concrete construction.

Between now and then third work.

Okay, and then I think I understood that we might have a bit of a slippage in the time schedule.

From Q1, 'twenty five to Q2 because of this little bit of delay was did I hear that right.

Yes.

Okay.

Okay. No I appreciate that and then maybe Daniel if I could just on the inflationary pressures where are you seeing easing if any and then just on the capex.

Yes, good morning.

Yeah.

Okay.

Good morning.

Hello, I can't hear anything.

Thanks.

The one there.

Yes, yes.

As Alejandro most access wanted to add that.

On the social issues of San Gabriel.

Sure.

Yes, what we have done after the social project, we have we have approached this further.

Located communities and villages we've been successful in approaching them and establishing a working space with more than basically to reinforce the formation of the project. We have opened very positive.

Its basis with most of them and we are confident we are strengthening our <unk>.

The whole social climate and Thats why rents are what's explaining that with that confidence we have resumed.

Many of the field activities.

Oriented to go into and through the ramp.

The ramp up of construction.

So this is an ongoing process and we feel very confident on what we have accomplished so far and we will continue on this report.

You gave a soldier sustainability to that project and just on the social front.

What have we done have we have you implemented social programs and their communities or have you implemented.

That those jobs for construction of the mine and working back yet have you.

Down to to help them along.

Yes, along with that with authorities.

From the Minister of mine from the environmental.

We reduced most of the places we have conducted.

Workshops in formation workshops, and some cases.

Also.

<unk> gotten some agreements.

Explaining about over environmental management and of course as well. We are also working on and as <unk> explained into building local capacity is to engage more.

Local workforce into the project.

Okay perfect. Thank you good to see that being resolved.

Okay. Thank you.

And Roger good morning.

Once again, if you would like to ask a question. Please press Star then one.

There are two questions.

Yes.

Alright.

Thanks, Tom.

Questions from you.

First one regarding the information you have.

<unk> bin.

Uh huh.

<unk>.

We have been.

Fee income a reduction in pricing.

Actually in detail.

John .

Thank you.

If we can make some.

Hello.

Does anybody there.

I don't hear anything so maybe someone in the web.

Pardon me this is the operator.

One moment, please right get the speakers.

Pardon me. This is the conference operator, please hold on while we reconnect Daniel to run.

Hello.

Yeah.

Hello. Please proceed Daniel.

Yes.

Anything except that you saw some relief and explosives and.

And that's.

That's it.

Yes, sorry.

We had a problem with the connection so if we compare the.

The prices of some of the consumables the nine months period of this year against the nine month period of last year, we have that for diesel.

There is a reduction of around 10% cyanide around 5% and exclusive between eight.

At 10% as an overall, we would say that we can have.

For the fourth quarter, we can have.

A reduction in inflation.

Consumer with prices of around maybe between 5% to 8%.

And also we have LIBOR.

Reducing due to the higher exchange rate that we have against the dollar.

Okay, and Danielle what about freight and transportation are you seeing any relief there.

Sorry, I didn't get your are you seeing any relief in freight transportation any.

Transportation costs.

Yes.

We also have been.

We see a trend upward.

Oh.

Decreased use of freights.

We cannot.

We don't have right now the the amount of the percentage, but we do.

We see these reduction.

Okay, that's great.

Good color and just on the labor side would you say do you see a related set of relief that would you know how much percent.

Yes, enable we would say that it's around 3% to 4%.

Perfect and then sorry, just lastly, I don't want to hog the call, but just on the Capex should like there'll be using 90 to 100 million for sustaining and 65% <unk>.

Well, we have revised our total capex for this year.

How can they can reach around $190 million.

For which $110 will be devoted to sustaining capex.

From the sustaining capex $40 million will be re <unk>.

Construct the Greenback project.

The growth we are expecting close to between 70 and $80 million from reached 65 will be devoted to <unk>.

The remaining four <unk> on other projects. This is for 2022.

Our Union Arden.

We can say that for 2023, the capex should be in the order of $340 million to $350 million.

Perfect. Thank you so much and ill, let somebody else ask questions.

Alright.

Thanks Daniel.

And once again, if you would like to ask a question. Please press Star then one.

And this will conclude our question and answer portion of today's conference call I'd like to turn the conference back over to you.

Mr Garcia for closing remarks.

Thank you, Jeff before we finish the vehicle vertical.

The thing again.

We're making the time to join us.

This cover.

A wonderful day.

The conference has now concluded thank you for attending todays presentation wed.

Wed like to thank you again for your participation and you may now disconnect.

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