Wheaton Precious Metals Corp. Q1 2023 Earnings Call

Speaker 1: Good morning ladies and gentlemen, thank you for standing by. Welcome to Wheaton Precious Metals 2023 first quarter results conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star, then the number one on your telephone keypad. Or type your question in the Q&A box in the webinar.

Ladies and gentlemen, thank you for standing by welcome to Wheaton precious metals 2023 first quarter results conference call.

All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. If you'd like to ask a question. During this time simply press Star then the number one on your telephone keypad or type. Your question in the Q&A box is a webinar.

Speaker 1: If you would like to withdraw your question, press star 2. Thank you. I would like to remind everyone that this conference call is being recorded on Friday, May 5, 2023 at 11 a.m. Eastern Time. I will now turn the conference over to Mr. Patrick Drouin, Senior Vice President of Investor Relations and Sustainability. Please go ahead. Take a moment to with your voices and listen to Kitesh

If you would like to withdraw your question Press Star two.

I would like to remind everyone that this conference call is being recorded on Friday may five 2023 at 11, a M. Eastern time I will now turn the conference over to Mr. Patrick Jermain Senior Vice President of Investor Relations and sustainability. Please do that.

Yeah.

Speaker 2: Thank you, operator. Good morning, ladies and gentlemen, and thank you for participating in today's call. I'm joined today by Randy Swalwell, Wheaton Precious Metals President and Chief Executive Officer, Gary Brown, Senior Vice President and Chief Financial Officer, Haytham Holley, Senior Vice President, Corporate Development, and Wes Carson, Vice President, Mining Operations. Please note that for those not currently on the webcast, a slide presentation accompanying this conference call is available in PDF format on the presentation page of the Wheaton Precious Metals website.

Thank you operator, good morning, ladies and gentlemen, and thank you for participating in today's call I'm joined today by Randy Smallwood, Wheaton precious Metals', President and Chief Executive Officer, Gary Brown, Senior Vice President and Chief Financial Officer, Haytham, <unk> Senior Vice President corporate development and West Carson Vice President mining operations. Please note that for those not currently on the webcast the slides.

Patient accompanying this conference call is available in PDF format on the presentation page of the Wheaton precious metals website.

Okay.

Speaker 2: I'd like to bring your attention that some of the commentary on today's call may contain forward-looking statements, and I would direct everyone to review slide two of the presentation, which contains important cautionary notes regarding forward-looking statements. It should be noted that all figures referred to on today's call are on the OSOLLRs, unless otherwise noted. Now, I'd like to turn the call over to Randy Smallwood, our President and Chief Executive Officer.

I'd like to bring your attention that some of the commentary in today's call may contain forward looking statements and I would direct everyone to review slide two of the presentation, which contains important cautionary notes regarding regarding forward looking statements. It should be noted all figures referred to on today's call are in U S dollars unless otherwise noted now I'd like to turn the call over to Randy Smallwood our pre.

<unk> and Chief Executive Officer.

Thank you Patrick and good morning, everyone. Thank you for joining us today to discuss <unk> first quarter results of 2023.

Speaker 3: Thank you, Patrick, and good morning, everyone. Thank you for joining us today to discuss Wheaton's first quarter results of 2023.

Speaker 3: I am pleased to announce that our high quality portfolio of long life, low cost assets delivered a solid performance to start the year.

I am pleased to announce that our high quality portfolio of long life low cost assets delivered a solid performance to start the year.

Speaker 3: First quarter production came in ahead of company expectations.

First quarter production came in ahead of company expectations.

Speaker 3: positioning us very well to achieve our previously announced annual guidance of 600,000 to 660,000 gold equivalent ounce.

Positioning us very well to achieve our previously announced annual guidance of 600 to 660000 gold equivalent ounces.

And as we continue to see positive developments at a number of our key assets, including Salobo and Constancia, we expect to see a significant production growth through 2023, culminating in a strong second half of the year.

Speaker 3: And as we continue to see positive developments at a number of our key assets, including Solobo and Constancia, we expect to see significant production growth through 2023, culminating in a strong second half of the year.

Notably implicit in our five year annual average production guidance is an impressive organic growth profile of over 40%.

Speaker 3: Notably, implicit in our five-year annual average production guidance is an impressive organic growth profile of over 40%, with two-thirds of that growth coming from assets that are already in operation.

With two thirds of that growth coming from assets that are already in operation.

Speaker 3: While inflationary pressures are still impacting all sectors of the economy, Wheaton has maintained the cash operating margin per ounce of over 75%, highlighting the resiliency of the streaming model in an inflationary world. And we achieved a key milestone in this first quarter as Wheaton...

While then questionary pressures pressures are still impacting all sectors of the economy. Wheaton has maintained a cash operating margin per ounce of over 75% highlighting the resiliency of the streaming model in an inflationary world.

And we achieved a key milestone in this first quarter.

As Wheaton total stream cash flow to date.

Speaker 3: has now exceeded 100% of its total upfront investments deployed since inception.

Has now exceeded 100% of its total upfront investments deployed since inception.

Speaker 3: This achievement highlights our disciplined and accretive approach to capital deployment.

This achievement highlights, our disciplined and accretive growth to our approach to capital deployment.

Speaker 3: In particular, given that our portfolio still has over 30 years of mine life remaining based on reserves in addition to a healthy resource base.

In particular, given that our portfolio still has over 30 years of mine life remain remaining based on reserves. In addition to our healthy resource base.

In this environment of high interest rates and increasing demand for metals, our corporate development team remains very busy.

As we continue to see a healthy appetite for streaming as a source of capital for the mining industry and we are actively pursuing several new accretive opportunities.

Speaker 3: And lastly, Wheaton continues to maintain our leadership and sustainability with sector-leading scores, including a AA rating from MSCI.

And lastly, we can continues to maintain our leadership and sustainability with sector, leading scores, including a double AA rating from MSCI.

Speaker 3: and a genuine number one rating in precious metals by Sustainalytics.

And a genuine.

Number one rating in precious metals by sustained analytics.

Speaker 3: I would now like to turn the call over to Wes Carson, our Vice President of Operations, who will provide more details on our results. Wes? Thanks Randy. Good morning.

I would now like to turn the call over to West Carson, Our Vice President of operations, who will provide more detail details on our results west. Thanks.

Thanks, Randy good morning.

Speaker 2: Overall production in the first quarter came in higher than expected, with strong production from Slobo and Constantia partially offset by weaker than expected performance from Stillwater.

Overall production in the first quarter came in higher than expected with strong production from slower on constancia, partially offset by weaker than expected performance from Stillwater.

Speaker 2: In the first quarter, Solobo produced 43,700 ounces of attributable gold, virtually unchanged relative to the first quarter of 2022.

In the first quarter Salobo produced 43700 ounces of attributable gold virtually unchanged relative to the first quarter of 2022.

Speaker 2: Despite the strong quarter, Valais reported that production during the quarter was affected by reduced plant availability caused by additional plant and corrective maintenance.

Despite the strong quarter Valley reported net production during the quarter was affected by reduced plant availability caused by additional planned and corrective maintenance. Additionally, the salobo III expansion project, which will increase the mill throughput by 50% successfully began production at the end of 2022.

Speaker 2: Additionally, the Sloughboat 3 mine expansion project, which will increase the mill throughput by 50%, successfully began production at the end of 2022. The project is expected to ramp up the full capacity by the fourth quarter of 2024.

The project is expected to ramp up to full capacity by the fourth quarter of 2024.

Speaker 2: During the quarter, Constanciia produced 600,000 ounces of attributable silver and 6,900 ounces of attributable gold, an increase of approximately 21% and 9% respectively, relative to the first quarter of 2022.

During the quarter Constancia produced 600000 ounces of attributable silver and six 6900 ounces of attributable gold an increase of approximately 21% and 9% respectively relative to the first quarter of 2022.

The increase in both silver and gold production was due to higher grades resulting from additional ore production from the public conscious I'd like deposit.

Speaker 2: The increase in both silver and gold production was due to higher grades resulting from additional ore production from the Pop-A-Conscious satellite deposit.

For mining activities resumed in the Hopper Gotcha pit in February and the period of high stripping from March to June is progressing well with.

Speaker 2: Full mining activities resumed in the Papakancha Pit in February , and the period of high stripping from March to June is progressing well, with mining of higher grade ore now expected in the second quarter of 2023 ahead of schedule.

With mining of higher grade ore now expected in the second quarter of 2023 ahead of schedule.

During the quarter Artemis Gold announced the approval of at BC Mines Act permit the final step required to allow Artemis to commence major works construction activities of the Blackwater mine.

Speaker 2: During the quarter Artemis Gold announced the approval of its BC Mines Act permit, the final step required to allow Artemis to commence major works construction activities at the Blackwater Mine.

Speaker 2: with the expectation of an initial gold pour in the second half of 2024.

With the expectation of an initial gulfport in the second half of 2024. Additionally.

Speaker 2: Additionally, during the quarter Artemis announced that it has issued a purchase order to Finn in Canada for primary and ancillary mining fleet required for the initial phase one of operations. Equipment deliveries to site are planned to commence late in the fourth quarter of 2023 and continue throughout the first half of 2024 in preparation for the pre-strip mining.

Additionally, during the quarter Artemis announced that it has issued a purchase order to fit in Canada for primary ancillary mining fleet required for the initial phase one of operations equipment deliveries to safety are planned to commence late in the fourth quarter of 2023 and continued throughout the first half of 'twenty 'twenty four 'twenty 'twenty four and preparation for the pre strip mining phase.

<unk> estimated attributable production in 2023 is forecast to be 320000 to 350000 ounces of gold in two.

Speaker 2: Wheaton's estimated attributable production in 2023 is forecast to be 320,000 to 350,000 ounces of gold, 20 to 22 million ounces of silver, and 22,000 to 25,000 GEOs of other metals.

20% to 22 million ounces of silver and 22000 to 25000 Geos of other metals, resulting in production of approximately 600000 to 660000 Geos.

Speaker 2: resulting in production of approximately 600,000 to 660,000 GEOs.

Speaker 2: For the five-year period ending in 2027, the company estimates that average production will amount to 810,000 ounces. And for the 10-year period ending in 2032, the company estimates that average annual production will amount to 850,000 GEOS.

For the five year period, ending in 2027, the company estimates the average production will amount to 810000 ounces and for the 10 year period ending in 2032. The company estimates that average annual production will amount to 850000 geos.

Speaker 2: This includes organic growth of over 40% with total production from our current portfolio increasing to over 900,000 GEOs by 2027.

This includes organic growth of over 40% with total production from our current portfolio increasing to over 900000 Geos by 2027.

Speaker 2: That concludes the operations overview, and with that I'll turn the call over to Gary.

That concludes the operations overview and with that I'll turn the call over to Gary.

Yes.

Thank you Wes.

Speaker 2: Thank you, Wes. I am pleased to present the financial highlights resulting from our solid operational performance to kick off the year. As described by Wes, production in the first quarter amounted to 142,000 GEOs above company expectations and consistent with the fourth quarter of 2022.

I'm pleased to present, the financial highlights, resulting from our solid operational performance to kick off the year as described by West production in the first quarter amounted to 142000, Geos above company expectations and consistent with the fourth quarter of 2022 sales volumes amounted to over 117000.

Speaker 2: Sales volumes amounted to over 117,000 GEOs, a decrease from the first quarter of the prior year, primarily due to the cessation of production from 777, Yali Yaku, and Keno Hill in 2022, coupled with relative changes to ounces produced but not yet delivered, or PBND.

<unk> a decrease from the first quarter of the prior year, primarily due to the cessation of production from Triple seven <unk> IQ and Keno Hill in 2022, coupled with relative changes two ounces produced but not yet delivered or PBS.

Speaker 2: Strong commodity prices, which remain near historical highs, coupled with our steady production base, resulted in revenue of $214 million and gross margin of $118 million. Of this revenue, 56% was attributable to gold, 40% to silver, 2% to palladium, and 2% to cobalt.

Strong commodity prices, which remained near historical highs coupled with our steady production base resulted in revenue of $214 million and gross margin of $118 million.

Of this revenue, 56% was attributable to gold, 40% silver, 2% to palladium and 2% to cobalt.

Speaker 2: As of March 31, 2023, approximately 124,000 GEOs were in PB&D and Cobalt inventory, representing approximately 2.4 months of payable production, which is a level that is consistent with the preceding four quarters.

As at March 31, 2023, approximately 124000 Geos were in PP&E and cobalt inventory representing approximately two four months of payable production, which is a level that is consistent with the preceding four quarters.

Speaker 2: G&A expenses and donations amounted to $11.5 million for the first quarter, resulting in adjusted net earnings of $104 million. The company continues to anticipate that G&A and donation expenses will amount to $47-50 million for the year.

G&A expenses and donations amounted to $11 $5 million for the first quarter, resulting in adjusted net earnings of $104 million. The company continues to anticipate that G&A and donation expenses will amount to 47% to $50 million for the year.

Speaker 2: Despite the persistent inflationary environment, and thanks to our low and predictable cost structure, we can continue to deliver robust cash operating margins in the first quarter, resulting in cash flow from operations of $135 million, which in turn resulted in a quarterly dividend of 15 cents per share, consistent with the first quarter of 2022.

Despite the persistent inflationary environment and thanks to our low and predictable cost structure. We can continue to deliver robust cash operating margins in the first quarter, resulting in cash flow from operations of $135 million, which in turn resulted in a quarterly dividend of <unk> 15 per share consistent with the first.

Quarter of 2022.

Speaker 2: In the quarter, Wheaton dispersed its fourth and final installment of $32 million relative to the Goose project, which continues to make advancements under the new ownership of B2Gold. It should be noted that subsequent to the quarter, B2Gold exercised the option to repurchase at 33% of the stream under the Goose pimp-up in exchange for a cash payment in the amount of $46 million, resulting in a gain on the partial disposal of the pimp-up.

In the quarter Wheaton disbursed, its fourth and final installment of $32 million relative to the <unk> project, which continues to make advancements under the new ownership, but b to gold.

It should be noted that subsequent to the quarter B two gold exercise the option to repurchase purchased at 33% of the stream out of the Goose pimped up in exchange for cash payment in the amount of $46 million, resulting in a gain on the partial disposal of the Tampa.

Speaker 2: in the amount of $5 million, which will be reflected in our Q2 results.

In the amount of $5 million, which will be reflected in our Q2 results.

Speaker 2: Overall, net cash inflows amounted to $104 million, resulting in cash and cash equivalents at March 31st of $800 million. This notable cash balance, coupled with the fully undrawn $2 billion revolving credit facility and the strength of our forecasted operating cash flows, positions the company exceptionally well to satisfy its funding commitments and provides us with the financial flexibility to acquire additional accretive mineral stream interest.

Overall, net cash inflows amounted to $104 million, resulting in cash and cash equivalents at March 31, <unk> of $800 million.

This notable cash balance coupled with the fully undrawn $2 billion revolving credit facility and the strength of our forecasted operating cash flows positions the company exceptionally well to satisfy its funding commitments and provides us with the financial flexibility to acquire additional accretive mineral stream interests that can clear.

Speaker 2: That concludes the financial summary and with that I turn the call back over to Randy.

The financial summary, and with that I'll turn the call back over to Randy.

Thank you Gary.

In summary, weakens first quarter was distinguished by several key highlights we achieved solid three months revenue earnings and cash flow and declared a 15 cent quarterly dividend.

Speaker 3: In summary, Wheaton's first quarter was distinguished by several key highlights.

Speaker 3: We achieved solid three-month revenue, earnings and cash flow and declared a 15-cent quarterly dividend.

Speaker 3: First quarter production came in ahead of our expectations, positioning us well to achieve our previously announced annual guidance of 600 to 660,000 gold equivalent ounces.

First quarter production came in ahead of our expectations positioning us well to achieve our previously announced annual guidance of 600 to 660000 gold equivalent ounces.

Yes.

Speaker 3: Wheaton has now recouped 100% of its total upfront investments deployed since inception, highlighting our disciplined and accretive approach to capital deployment.

Wheaton has now recouped, 100% of its total upfront investments deployed since inception, highlighting our disciplined and accretive approach to capital deployment.

Speaker 3: We reiterated our forecast organic production growth profile of over 40%.

We reiterated our forecast organic production growth profile of over 40%.

Speaker 3: over the next five years with approximately two thirds of that growth coming from mines already in operation therefore at lower risk of delivery.

Over the next five years with approximately two thirds of that growth coming from mines already in operation Therefore at lower risk of delivery.

Our balance sheet remains one of the strongest in the industry, providing ample capacity to add accretive high quality streams into our portfolio and we continue to be very busy on that front.

Speaker 3: Our balance sheet remains one of the strongest in the industry, providing ample capacity to add accretive, high-quality streams into our portfolio, and we continue to be very busy on that front.

Speaker 3: And lastly, we continue to demonstrate leadership and sustainability with sector-leading ESG ratings.

And lastly, we continued to demonstrate leadership and sustainability with sector, leading ESG ratings.

So with that I would like to open up the call for questions operator. Please.

Speaker 3: So with that, I would like to open up the call for questions, operator, please.

Speaker 1: Ladies and gentlemen, we will now conduct the question and answer session. If you would like to ask a question, please press star, then the number 1 on your telephone keypad. If you would like to withdraw your question.

Thank you, ladies and gentlemen, we will now conduct a question and answer session. If you would like to ask a question. Please press Star then the number one on your telephone keypad. If you would like to withdraw your question Press Star two.

Speaker 1: Your first question comes from Ralph Proffitti with 8 Capital. Please go ahead.

Your first question comes from Ross property with eight capital.

Please go ahead.

And Stan Sabina.

Hello transactions closed.

Sorry, Ralph we missed the first part of that.

Sorry, Randy can you hear me now.

Yes.

Now again, yes.

Sure.

Ralph I'll just yet.

My apologies can you hear me now.

Yes, we can.

Sorry about that thanks operator.

Speaker 4: Sorry about that. Thanks, operator. Randy, B2Gold and Sabina is now closed. Just wondering if you've had conversations with the new management team and whether or not you're comfortable with the original guidance of when first production is, first quarter 2025, I believe. And is that factored into your guidance?

Randy Beta Golden Sabine has now closed just wondering if you've had conversations with the new management team and whether or not youre comfortable with the original guidance of when first production is first quarter 2025, I believe and is that factored into your guidance.

Speaker 3: We haven't made any adjustments based on B2 operating it. I do have confidence in Clive and B2. They've got a very strong track record. I've known Clive and the B2 team for a very long time. I have a lot of respect for what they're doing.

We haven't made any adjustments based on.

Btu operating yet I do have confidence and Clive in <unk>, they've got a very strong track record of non client and the <unk> team for a very long time had a lot of them have a lot of respect for what they're.

They are doing.

Speaker 3: The one advantage that they're going to have is, of course, a much stronger balance sheet than Sabina had originally. The negative to that is that we were always hoping to be able to add a bit more financing through growing the stream a bit, but clearly B2 has the capacity to deliver this project from a capital perspective. I think that what we're going to see is an even better project out of B2 Gold, or sort of out of the Goose project with B2 Gold.

The one advantage that theyre going to have is of course, a much stronger balance sheet than Sabina had originally the negative to that is we were always hoping to be able to add a bit more financing.

Through growing the stream a bit but clearly <unk> has the capacity to deliver this project from a capital perspective and so.

I think that what we're going to see is an even better project out of <unk> gold.

Or sort of out of the <unk> project with Btu gold.

Speaker 4: good. Yeah, I see some of that optionality coming.

Good.

See some of that Optionality come in.

Speaker 3: Yes, definitely. I'm glad you wanted to add something. Yeah, also worth noting, it is in the five and ten year guidance and the five and ten year guidance is reflective of the buyback.

Yes definitely.

Do you want to ask you also worth noting it is in the five and 10 year guidance and the 5% your guidance is reflective of the buyback as well.

Speaker 4: Okay, good. Just factoring in, taking us a little bit of a step back from the buyback on that stream, does the team at Wheaton make a risk factor adjustment for stream negotiations when they do have the buyback option in place? Can you quantify some of the decisions that you make on discount rates when that's factored in? Is this two separate pieces of analysis or one that you commingle into looking at how you risk adjust for the buyback optionality?

Okay. Good good and just factoring in taking us a little bit of a step back from from the buyback on that stream.

Does the team at <unk> can make a risk factor adjustment for stream negotiations when when they do have the buyback option in place in <unk>.

Sort of quantify.

Some of the.

Some of the decisions that you make on discount rates when that's factored in is it sort of two separate pieces of analysis or ones that you sort of co mingle into looking at how you risk adjust for the buyback optionality.

Speaker 3: Well, I mean the way we structure the buybacks is that we get a reasonable rate of return. You know, we recognize that a lot of these partners that we're working with right now are single asset development companies and we don't want to get in the way of them eventually being acquired. So it is something that we're seeing a lot more of is the need for it.

Well I mean, the way we structure the buybacks is that we get a reasonable rate of return.

Ignite is that a lot of these.

Partners that we're working with right now are.

Single asset development companies, and we don't want to get in the way of them essentially being acquired so so it is something that we're seeing a lot more of is the need for it.

Speaker 3: And what we're looking for is just a reasonable rate of return on that part of the risk capital that we're putting up. We are long-term investors into these projects and so we do want to make sure that we maintain a reasonable return for our shareholders at the bare minimum.

And what we're looking for is just a reasonable rate of return on that on that part of the risk capital that we're putting up.

We are long term investors into these projects.

And so so we do want to make sure that we maintain a reasonable.

Return for our shareholders at the bare minimum with respect to any of the capital that we're putting up and so I think the structure works well I don't know Haytham you want to add anything to that yes. Thanks Rajeev Ralph.

Speaker 3: with respect to any of the capital that we're putting up. And so, you know, I think the structure works well. I don't know, Haitham, you want to add anything to that? Yeah, thanks, Randy. Ralph, what we've also done when we structure these things is we limit our buyback to a one-third buyback.

Done when we start to these things as we limit our buyback to a one third buyback and we want the street to be perceived as a quality type of financing that doesn't deter.

Speaker 5: and we want the stream to be perceived as a quality type of financing that doesn't deter M&A transactions and I think that was very well proven here with the sustenance effectively of our two-thirds of the remainder of our stream and then some of the private equity stuff didn't remain which shows you that we're very, the way we structure things, we're very capable of putting in place something that actually appeals even to a potential acquirer of one of these developments.

M&A transactions and I think that was very well proven here with that.

Its just.

Just that it's effectively over two thirds of the remainder of our extreme and then some of the private equity stuff didn't remain which shows you that.

We're very the way we structure things, where we're very capable of putting in place something that actually appeals even to a potential acquirer why these development stage opportunities.

Speaker 3: So we're excited about partnering with Clive. Yeah, got you. Thanks very much. Very helpful.

So we're excited about partnering with clients.

Yes got you thanks very much very helpful.

Thanks Ralph.

Speaker 1: Our next question comes from Jackie Prevalowski with BMO Capital Markets. Please go ahead.

Your next question comes from Jackie <unk> with BMO capital markets. Please go ahead.

Hi, Thanks very much my question is.

HUD Bay's copper World project.

Speaker 6: HUHD Bay's Copper World project. I know you guys have talked before about restructuring that stream financing, and I was just wondering if you could give us any update on that, if there's been any progress in discussions with the operator, thank you.

I know you guys said before about restructuring.

That stream financing and I was just wondering if you could give us any update on that if there's been any progress in discussions with the operator.

Speaker 3: There hasn't, Jackie. They're still working on finalizing their plans on a go-forward basis and so I think we just have to be patient and wait for them to come up with a firmer framework on how Copperworld is going to compare relative to the original Rosemont structure.

There Hasnt Jackie.

They are still working on finalizing their plans on a go forward basis, and so I think we just have to be patient and wait for them to come up with a firmer framework on that on how copper world is going to compare relative to the original rosemont structure.

Ill.

Speaker 3: Hud Bay is a long-time partner of ours, and we've done a lot of work with him in the past, and Peter and the team very well, and so we look forward to sitting down with him at that stage. It's just, it's not at that stage in terms of us being able to fine-tune how that stream will come into play. Thank you very much.

<unk> is a longtime partner of ours and we've done a lot of work with them in the past and.

Peter and the team very well and so we look forward to sitting down with them at that stage. It's just it's not it's not at that stage in terms of us being able to fine tune how that.

How that stream will come into play.

Alright, Thank you very much.

Thanks Jackie.

Operator.

Speaker 1: Your next question comes from Merton Practor with Veritas. Please go ahead.

Your next question comes from Martin <unk> with Baird.

Please go ahead.

Speaker 7: Thank you. I have two questions. My first question is why Antamina production was...

Thank you.

I have two questions. My first question is.

Why enter Mena production was weak.

Speaker 7: And why Salovo, we see a very different...

Salobo, we see a very different.

Speaker 7: very different the sales than the production. I mean, production was similar than last year, but sales were like 20%.

Very different the sales then the production I mean production with similar than last year, but sales were like 20% lower.

That's my first question sure sure West or do you want to take that.

Speaker 5: Sure, sure. Wes, do you want to take that? Yeah, thanks for the question, Martin. So, Antimida really is just a function of where they're mining in the pits.

Good question Martin So <unk> really is just a function of where they are mining in the pit so theres different grades in various different areas of the pit and we did see a higher grade coming out in the latter end of last year and really they are just into a lower grade area of the pit and in this year. So that's really what we're seeing as they move around within the pit.

Speaker 5: So there's different grades in the various different areas of the pit and we did see higher grade coming out in the latter end of last year and really they're just into a lower grade area of the pit in this year. So that's really what we're seeing. As they move around within the pit, the different areas of the ore body are going to have different amounts of production to them. So not unexpected, basically what we would expect to see from that one.

The different areas of the ore body are going to have.

Different amounts of production to them, so not unexpected basically with what we would expect to see from from that one.

Speaker 5: And on Salobo really that is a lag between the production and the sales. So we get a copper concentrate from Salobo is what's produced there and there is a lag between what's produced on the mine site and then what we see in sales. So that's what's reflected in our produce but not delivery. And I will say that typically amongst all of our assets.

On the logo really that is a lag between the production and the sales. So we get a copper concentrate from Salobo is what's produced there and there is a lag between what produced on the mine site and then what we see in sales so and that's what's reflected in our produced but not delivered and I will say that typically amongst all of our assets.

Speaker 3: In the first quarter we tend to wind up building up a bit of an inventory and I think that just comes from the fact that a lot of our partners will sort of squeeze the pipeline to try and get a bit more sales in before year end and then that whole sort of production flow fills up again in the first quarter.

In the first quarter, we tend to wind up building up a bit of AR and inventory and I think that just comes from the fact that a lot of our partners will sort of squeezed the pipeline to try and get a bit more.

Sales in before year end and then the.

Whole of sort of.

Production flow fills up again in the first quarter.

Speaker 3: So it wasn't a surprise to us in terms of seeing a bit more inventory build up over the course of the first quarter and I would say that typically in the fourth quarters we tend to see that drop as companies push up sales.

So it wasn't a surprise to us in terms of seeing seeing a bit more inventory buildup over the course of the first quarter and I would say that typically in the fourth quarter as we tend to see that drop as companies.

Pushed up sales so.

Speaker 8: Second question? Yeah. Could you comment about the global tax impact? You mentioned that that's going to come.

Second question.

Could you could you comment about the global tax impact I mean.

You mentioned that.

Going to come.

Speaker 7: into play very soon. So what is the company view on this?

Into play very soon.

So what is the company view on this.

Yes.

It's Gary Brown here.

Speaker 2: You know, it's hard to give you a detailed response given that we don't have any legislation to refer to at this point. All we can say is that, you know, based upon the...

It's hard to give you.

Detailed response, given that we don't have any legislation.

Two referred to at this point.

All we can say is that based upon the.

The comments made by the government of Canada that we do they do seem to be committed to implementing a GMT at 15%.

Speaker 2: the comments made by the government of Canada that they do seem to be committed to implementing a GMT, a 15% GMT, a 15% GMT, a 15% GMT, a 15% GMT, a 15% GMT.

Speaker 2: global minimum tax rate that seems to be applicable to 2024 and onwards. Again, there's no legislation at this point, so there's a lot of work that would need to be done in order to implement that by Gen 1 of next year, but we're assuming that that's going to happen.

Global minimum tax rate.

And that seems to be applicable to 2024 and onwards.

Again Theres no legislation at this point.

So there's a lot of work that would need to be done in order to implement that by June one of next year, but we're assuming that that's going to happen.

Speaker 2: And the vast majority, 90 plus percent of our income, is generated outside of Canada.

The vast majority 90 plus percent of our income is generated outside of Canada. So.

Speaker 2: we expect that it would have about a 10% impact to our NAV calculations once implemented. That being said, I think the market is well aware of this.

We expect that.

That it would have about a.

A 10% impact to our.

NAV calculations.

Calculations.

Once implemented that being said I think the market.

Well aware of this.

Speaker 2: this new tax and has already reflected that in our valuation.

This new tax.

<unk> has already reflected that in our valuation.

But in terms of 2024.

Speaker 7: But in terms of 2024, if it goes ahead, you expect to pay how much in taxes that year? Like a

If it goes ahead, you expect to pay how much in taxes that you.

Like at 10% or 15% or well.

Speaker 2: Well, you know, if you assume that 90% of our income is generated outside of Canada and is subject to a 0% tax, you know, multiply that by 15% to estimate what we would pay in 2024.

If you assume that.

90% of our income is generated outside of Canada.

And is subject to a zero percent tax.

Multiply that by 15% to estimate what we would pay in 2024.

Speaker 3: The challenge is that without the legislation we're not sure...

The challenge is is that without the legislation we're not sure.

Speaker 3: We don't have clarity in terms of what's deductible, what goes against that tax. There's not a framework yet in which we can paint it against right now. So if you're going to, it's really tough to sort of put firm numbers on that. I think what we have seen, and it's been talked about quite a bit, is that the overall estimated impact to our net asset value should be somewhere around 8 to 10 percent.

We don't have clarity in terms of what's deductible, what what are what goes against that tax we're not there's not a framework within which we can paint it against right now and so so if you're going to.

It's really tough to sort of firm numbers on that I think.

What we have seen and it's been talked about quite a bit is that.

The overall estimated impact to our net asset value should be somewhere around 8% to 10% then.

Speaker 3: And, you know, until we get further clarity, and I think everyone gets further clarity on what's actually coming into play, we're not quite sure what we'll be able to, how we'll be able to work with that legislation.

Yes.

And until we get further clarity and that tells us that I think everyone gets further clarity on what's actually coming in into play we're not quite sure what we'll be able to how we'll be able to.

Work with that.

With that legislation.

Great. Thank you very much thank.

Speaker 3: Thanks Martin next call for next question, please your next question comes from Richard Hatch with Barenberg.

Thank you Martin.

Next call next question. Please your next question comes from Richard Hatch with Burn Baird. Please go ahead.

Speaker 9: Yeah, good morning Randy and team. Thanks a lot for the call and well done on a good call. Gary, my questions are mainly sort of aimed towards you. First one is just on page 24 of the MD&A, you've got your contractual obligations and contingencies. I just wonder if you might be able to just help us out a little bit just in terms of just thinking about next quarter, what are the ones that we should start to put into our models just to make sure that we're right on the cash flow. That's the first one.

Yes, good morning, Randy and team Thanks Hello.

The colon.

And Gary.

Questions remind me so.

Well Gee.

First one is.

Just on <unk>.

Page 24 of the MD&A.

Contractual obligations and contingencies.

I was just wondering if you might be able to just help us out a little bit just in terms of.

Just thinking about next quarter and what are the ones that we should start putting schwab models just to make sure we have Brian on the cash flow. That's the first one.

Speaker 2: Yeah, I mean I don't know that we can get that granular. So, you know, I think we've tried to outline what we are, and this is a conservative picture of the contractual obligation.

Yes, I mean, I don't know that we can get that granular.

So I think we've tried to outline what we are and this is a conservative picture the contractual obligation.

Speaker 2: schedule that we put out showing $700 million being paid between March 31st and December 31st. That's assuming all of the projects and the biggest one of that is Ding slower and moreweet.

Schedule that we put out showing $700 million being paid.

Between March 30 <unk>.

In December 31, that's assuming all of the projects and the biggest one of that is at Salobo and.

<unk>.

That.

Speaker 2: may slip into 2024, but we're assuming that Valais achieves the full completion test of the Lobo 3 in that $552 million number. So I'm not prepared to break down what we expect to be dispersed next quarter at this point.

May may slip into two.

2024.

As but we're assuming that ballet achieves.

The full completion.

First the Lobo III.

And that $552 million number but.

So.

I'm not prepared to break down what we expect to be disbursed next quarter at this point.

Speaker 5: Richard, we can speak offline as well and walk through our best expectations.

Great Alright.

Alright.

We can speak offline as well and kind of walk through our best expectations that being said I think Richard.

Speaker 2: That being said, I think Richard, it's important to highlight, we have no concerns with respect to paying those. We ended the quarter with $800 million of cash on hand.

Important to highlight.

We have no <unk>.

<unk> with respect to paying those we ended the quarter with $800 million of cash on hand and.

Speaker 2: and we've got the $2 billion revolving credit facility there as well. So we're extraordinarily well positioned to make those disbursements as and when they come due.

And we've got the $2 billion revolving credit facility, there as well so we're extraordinarily well positioned to make those disbursements as and when they come due.

Speaker 9: Yeah, sure. No, not worried about the balance sheet. I was just getting them all tight. And then on Neves Corvo, last couple of quarters sales volumes have really lagged production. I appreciate it's one of the smaller streams, but have you got any color on what's going on there and we should think about when that kind of elastic bands back into the sales.

Sure.

I'm not worried about the balance sheet.

Getting the model a little tight.

Just and then I'll call Nevis.

Cool.

Last couple of quarters.

<unk> sales volumes as really flagged.

I appreciate it's wanted to smaller streams.

Have you got any color on what's going on there and when we should think about when that kind of.

Elastic bands back into the Shadows.

Speaker 5: We did see that Navish Corvo this quarter actually came in quite a bit ahead of our expectations on that. So it is starting to come back. I think some of it certainly is the ramp up of that Zinc expansion project and where they have gotten to there. But overall we have seen the performance improving at Navish Corvo over the last several quarters.

Yes, we did see that never Scarborough this quarter actually came in quite a bit ahead of our expectations on that so it is starting to come back I think.

Some of it certainly is the ramp up of that zinc expansion project and where they've got into there, but overall, we've seen the performance improving at Nebbish corbo over the last several quarters.

Speaker 9: Yeah, but if you look at the, say for example, Q4 you got 369,000 ounces, Q1 you got 352, the sales were 80 and 171. So the kind of the question is when do we start to see some of those production volumes translate into sales.

Yes, if you look at the sake for example.

For your 369000 ounces <unk> Eagle Ford shale.

<unk> and 171 Sei.

The question is.

When do we start to see some of those production volumes translating sales.

Speaker 5: One of the things you have to remember on Navish is that the silver and the zinc concentrate is not payable. There is always going to be a fairly significant gap between sales and production on Navish Corvo.

Yes, one of the things you have to remember on NAV issues that they have the zinc so.

The silver and the zinc concentrate is not payable. So there is always going to be a fairly significant gap between sales and.

And.

Production on Nebbish cargo. So it's not a direct comparison, so you won't be able to see that full amount come in but that being said there is a lag on the copper and the lead concentrate so and as that production starts to ramp up then we should see the sales training behind it's usually about a three months lag on that.

Speaker 5: So it's not a direct comparison. So you won't be able to see that full amount come in.

Speaker 5: But that being said, there is a lag on the copper and the lead concentrate. So as that production starts to ramp up, then we should see the sales straying behind. It's usually about a three month lag.

Speaker 3: Payability is on silver and zinc concentrates are very low and there's quite a bit of the silver here that is contained in zinc concentrates. So I think there's a bigger discrepancy between that. We typically have recovery rates in our reserve and resource. Yeah, there should be some, you know, happy to provide a bit more detail on that. But I think the challenge is that a lot of the silver out of Nevis Corvo comes out in zinc concentrates.

<unk> on silver and zinc concentrates as are very low and there is quite a bit of the silver here that is contained zinc concentrates and so I think that's the there's a bigger discrepancy between.

Between that.

We typically have recovery rates in our reserve and resource.

Yes sure.

Be some some some.

Yes, happy to provide a bit more detail on that but.

The challenges is that a lot of the silverado leveraged corporate comes out in zinc concentrate.

Speaker 9: Yeah, okay, yeah, understood. Alright, cool. And then on the depletion number, that was quite a bit lower, quarter on quarter. Is there any, I guess you had a couple of streams sort of roll away, but is there anything that we should be thinking about as we look sort of further out just in terms of the patient number?

Okay understood Alright, and then on the depletion numbers that was.

Quite a bit lower.

Quarter on quarter.

I guess, you've got a couple of strange sort of all the way, but is there anything that Sam and he noted that we should be thinking about as Phoenix will further out just in terms of patient numbers.

Speaker 2: I think the main driver for the lower depletion this quarter was the lower sales volume, which in turn was due to the

I think the main driver for the lower depletion in this quarter was the lower sales volume, which in turn was due to that.

Speaker 2: cessation of flows from three mines that we're no longer receiving deliveries from. So we do go through a process in Q1 of every year of updating our depletion rates for any changes that we observe in the reserve and resources of the assets that we have interest in. That didn't change our overall depletion rate by more than 1%. So it's a very nominal impact on that.

Cessation of flows from three mines.

<unk>.

We're no longer receiving.

Deliveries from so.

We did we do go through a process.

In Q1 of every year.

Dating our depletion rates for any changes that we observe in the reserve and resources.

The assets that we have interest in that.

It didn't change our overall depletion rate by more than 1%. So it's a very nominal impact on.

Speaker 2: on our depletion rates going forward. So, you know, I think, you know, I guess the other factor would be that, you know, some of the minds that we have in terms of the

On our depletion rates going forward, so I think.

I guess, the other factor would be that some of the the mindset.

Speaker 2: we disposed of last year were higher depletion rate mines than the ones that we're currently receiving deliveries from. But overall it's less than a 1% adjustment to depletion rate.

We disposed of last year were higher depletion rate mines than then.

The ones that.

We are currently receiving deliveries from but overall, it's less than a 1% adjustment to depletion rates.

Speaker 9: Okay, alright, thanks Gary. And the last one, it's just on, again, like a bit of a weird one, but in the cash flow statement, acquisition of long-term investments, $8 million out the door, it sits in other, in common shares held. Are you able to disclose what that was? That was the Integra investment. Okay, cool, thank you very much.

Okay, Alright, thanks, Scott.

The last one is just on them again.

Wade.

In the cash flow statement.

Acquisition of long term investments and $8 million out the door.

Hayden Ava in common shares held are you able to disclose what that was.

That was the integra.

Investment.

Okay. Okay. Thanks.

Thank you very much.

Great operator, one more question please.

Your next question comes from Danielle <unk> with Scotiabank.

Please go ahead.

Speaker 10: Great. Good morning, everyone. Thank you so much for taking my questions. I have two. If I could just start on just the 2023 guidance, I just want to make sure I have how your year progresses. So I'm thinking you've mentioned that you're going to have a stronger second half.

Hey, good morning, everyone. Thank you so much for taking my questions I have two.

If I could just start just the 'twenty two 'twenty three guidance I just wanted to make sure I have.

How your.

So I'm thinking you've mentioned that you're going to have a stronger second half.

Speaker 10: I'm just wondering if I look at it holistically, does a 45 first half versus 55 second half seem reasonable with quarter over quarter improvement?

I'm just wondering if I look at it holistically.

45, first half versus 55 second half seem reasonable.

Over quarter improvements.

Speaker 3: That sounds about right. What we see over the course of this year is just continued improvement, both in Constantia and Salobo.

That sounds about right I mean, what we what we see over the course of this year is just continued improvement.

Both the Constancia and Salobo.

Speaker 3: As Line 3 ramps up and as they continue to improve Line 1 and Line 2 at Salovo and try and get production up to former.

Line, three ramps up and as they continue to improve line one and line two at Salobo.

And try and.

Get production up to former levels.

Speaker 3: We see continued improvement there and we've just finished another site visit down to Salobo and we're happy with the progress that is being made at the site.

We see continued improvement there.

And we've just finished another site visit down to Salobo in and we're happy with the progress that is being made at the site and so and so.

Speaker 3: And so, what I can tell you is the production for the first quarter was at the very top end of our guidance right now. So if we keep on this trend, we would be at the 660,000 gold equivalent ounce level. We were right at that top end of our guidance range.

What I can tell you is the production for the first quarter was at the very top end of our guidance right now. So so if we keep on this trend we would be at the 660000 gold equivalent ounce level, we were right at that top end of our guidance range and so that's kind of probably the best way to set it up in terms of how we see it every quarter.

Speaker 3: probably the best way to set it up in terms of how we see it. Every quarter, in fact, if I sit and look at it, I think that every quarter for the next five years should probably be better than the last one. There might be a few blips in there, but we are going to see continued improvement all the way across the portfolio.

In fact, if I sit and look at it I think that every quarter for the next five years should probably be better than the last one.

There might be a few blips in there but.

We are going to see continued improvement all the way across the portfolio Tanya.

Speaker 10: OK, and so just for 2023, just that we have syllable ramping up, that's right, kind of stands here, getting into the higher grades. So that should be better second half. What about Boisi Bay and Penasquito? Are you seeing any improvement in Q2, or should I kind of put them all into Q3, Q4?

Okay, and so just for 2023, just that we have salobo ramping up constancia getting into the higher grade so that should be better second half.

<unk> and <unk> are you seeing any improvement in Q2, I should I kind of put them all into Q3 Q4.

Speaker 5: Not a significant improvement at either Penasquito or Boise's Bay in the second half. They'll be fairly, the big kind of step up at Boise's Bay is really in Q4 and into next year once they get into the undergrounds there. And Penasquito is fairly static across the year.

Not as significant improvement at either <unk> or <unk> in the second half there'll be fairly the big kind of step up in voice. These days is really in Q4 and into next year once they get into the underground there at Penske is fairly static across the year.

Speaker 3: Yes, Boise's Bay is going to be, you know, they're still pulling from open pit material to supply and the underground is substantially higher grade cobalt for us. So once that underground does phase in, we should see a pretty rapid uptick in terms of production from Boise's Bay.

Yes.

I'm going to say, it's going to be.

I mean, theres still pulling for open pit material to supply in the underground is substantially higher grade cobalt for us and so so once that underground does phase in.

Yeah.

Pretty rapid uptick in terms of production from voice has been.

Very helpful. Thank you and then.

Speaker 11: Oh, candy, I don't know. We can't hear you anymore.

Danny I don't know, we cant hear you anymore.

Operator, do you know if <unk> still on the line for questions.

Speaker 11: Operator, do you know if Tanya is still on the line with questions? Tanya, please press...

Can you please press.

Thank you your line is open.

Oh.

Hello.

Yes, okay.

Speaker 10: Okay, I'm back. I didn't know if you wanted to hear me or didn't want to hear me. Anyways here. It depends on the question. Okay, well it is about transactions. That's why I thought maybe you didn't want to hear me.

Didn't know if you wanted to hear me didn't want to hear me.

Anyways.

It depends on the question.

Okay, well it is about transaction, that's why I thought maybe you didn't want to hear me.

Speaker 10: So maybe if I hate them, I should just ask, you know, I'm always interested in, you know, with

So maybe if I hate them.

Just ask.

I'm always interested in.

Speaker 10: volatility in pricing in both gold and other metals. What does the deal environment look like? Has it changed from last quarter? I know we had talked about the $150 to $350 million.

Volatility in pricing in both gold and other metals.

Does the deal environment look like has it changed from last quarter. I know, we had talked about 150 to 350 million pounds of level in terms of financing.

Speaker 10: change level in terms of financing of development projects. I'm just wondering if that's still the case or are you seeing anything different out there, including the structure of the deal?

The development projects I'm, just wondering if that's still the case or are you seeing anything different out there, including the structure of the deal.

Speaker 3: Yeah, good morning, Kanya. Thanks for the question. Yeah, we're still seeing opportunities to fall in the $150 to $350 million range.

Yes, good morning.

Thank you for the question, Yes, we're still seeing.

As opportunities to fall in the $150 million to $350 million range still to be honest with you a very healthy number of opportunities in our pipeline and the majority of our development stage, but we are starting to see some operating assets as well. So that's a positive focus for us is always on precious metals gold silver platinum palladium so that.

Speaker 3: still to be honest with you, a very healthy number of opportunities in our pipeline and you know the majority are developed to this stage but we are starting to see some operating assets as well. So that's a positive, you know the focus for us is always on precious metals, gold, silver, platinum, palladium, so that's the areas that we're looking at at this point in time and we're actually quite optimistic about the outlook for the remainder of this year. So we're hoping to show you some things as time goes on.

The areas that we're looking at at this point in time, and we're actually quite optimistic about the outlook for the remainder of this year. So we are hoping to show you some things as time goes on.

Speaker 10: And when you mentioned operating assets, how do you define that? You're just the company that need to fix balance sheets on their operating assets? No, I'm talking specifically about assets that are actually operating and if streamed could contribute immediately to Wheaton's bottom line.

And when you mentioned operating assets, how do you define that you're just companies that need to fix balance sheets on their operating assets.

Im talking specifically about assets that are actually operating.

<unk> could contribute immediately to weakness bottom line.

Speaker 10: Okay, I was just thinking of it from the operator why they would need you. Was it just the fixed balance sheets on their side?

Okay I was just thinking of it from the operator, why they would need you with just a fixed balance sheets on their side.

And we don't see a lot of stressed balance sheets, but we do see though is a need for funding capital right.

Speaker 3: We don't see a lot of stress balance sheets, but we do see though, there's a need for funding capital, right? So it's growth, typically either expansions, the stuff we're looking at is either expansions or funding another acquisition into an operating company. And you know, it's even in today's equity market, the way it stands for a lot of these smaller companies, even though they've got operations, the capital from the streaming agreement is still very, very attractive. So we are seeing stuff along that line.

It's growth.

Typically either expansions of stuff. We're looking at is either expansions or funding another acquisition into an operating company and.

It's even in love with today's equity market the way it stands for a lot of these smaller companies.

Even though they've got operations.

Streaming capital capital from our streaming agreement is still very very attractive. So we are seeing stuff along that line.

Speaker 10: That was good to see. OK, thank you so much. And thank you for taking my question.

It's good to see okay. Thank you so much and thank you for taking my question.

Speaker 3: It wasn't our side. You just disappeared on us. I think someone did star two. Get her off. Thank you. Have a good week everyone. Thank you and thanks everyone for dialing in today. In closing, we believe Wheaton is very well positioned to continue delivering value to all of our stakeholders for a number of different reasons.

It wasn't our side here.

Thanks, Amit.

To get it off.

Thank you.

I think I've had a few.

Yes, Tanya and thank you for thank you and thanks, everyone for dialing in today.

Closing, we believe Wheaton is very well positioned to continue delivering value to all of our stakeholders for a number of different reasons, firstly by offering our shareholders exposure to our diversified portfolio of long life low cost assets that we believe has one of the best organic growth profiles in the mining industry.

Speaker 3: Firstly, by offering our shareholders exposure to our diversified portfolio of long-life, low-cost assets that we believe has one of the best organic growth profiles in the mining industry.

Speaker 3: Secondly, by having low unpredictable costs which are resilient to inflationary pressures, resulting in some of the highest margins in the entire precious metal space, which has allowed us to consistently return value to shareholders through our dividend policy.

Secondly, by having low and predictable costs, which are resilient to inflationary pressures, resulting in some of the highest margins in the entire precious metal space, which has allowed us to consistently return value to shareholders through our dividend policy.

Speaker 3: And lastly, by being a leader amongst precious metal streamers in sustainability and by supporting our partners and the communities in which we live and operate. So with that, I'd like to finish off by saying that after nearly 20 years at this company, since we've created it, I personally have never been more excited about our future prospects. We believe that now is a great time to own more Wheaton.

And lastly by being a leader amongst precious metal streamers in sustainability.

And by supporting our partners and the communities in which we live and operate.

With that I'd like to finish off by saying that after nearly 20 years at this company since we created it.

I personally have never been more excited about our future prospects. We believe that now is a great time to own more wheaton.

I do look forward to speaking with all of you again soon thank you.

Speaker 3: I do look forward to speaking with all of you again soon. Thank you.

Speaker 1: This concludes this conference call for today. Thank you for participating. Please disconnect your line.

This concludes this conference call for today. Thank you for participating please disconnect your lines.

[music].