Q1 2024 SilverCrest Metals Inc Earnings Call
Yeah.
Speaker Change: [music]. Please standby your conference is about to begin should you need operator assistance. Please press star zero.
Operator: Please stand by. Your conference is about to begin. Should you need operator assistance, please press star and zero.
Unnamed Participant: [inaudible]
Operator: Good day, everyone, and welcome to this Silvercrest first quarter 2024 results conference call. At this time, all participants are in a listen only mode. And later, you will have the opportunity to ask questions during the question and answer session. You may register to ask a question at any time by pressing the star and one on your touchtone phone. Please note this call may be recorded. I will be standing by should you need any assistance. It is now my pleasure to turn the conference over to the CEO and director of Silvercrest, Mr. Eric Fier.
Speaker Change: Good day, everyone and welcome to the Silvercrest first quarter 2024 results conference call. At this time all participants are in a listen only mode. And later you will have the opportunity to ask questions. During the question and answer session. You may registered to ask a question at any time by pressing the star and one on your Touchtone phone. Please note this call may.
Speaker Change: To be recorded I'll be standing by should you need any assistance. It is now my pleasure to turn the conference over to CEO and director of Silvercrest, Mr. Eric sphere.
Nathan Eric Fier: Thank you, operator. Good morning, and thanks everyone for joining us.
Speaker Change: Thank you operator, good morning, and thanks, everyone for joining.
Nathan Eric Fier: Today we'll be providing commentary on our Q1 2024 results, after which we'll be happy to take questions. The slide deck we'll be referring to is available on our website at silvercrestmetals.com under the investor tab. Before we get started, I'd like to direct you to the forward-looking statement on slide 2. All figures discussed this morning are in U.S. dollars unless otherwise stated. All of the ounce and per ounce references discussed will be based on silver equivalent ounces sold unless otherwise indicated.
Speaker Change: They will be providing commentary on our Q1 2024 results after which we'll be happy to take questions.
Speaker Change: <unk> will be referring to is available on our website at silvercrest metals dot com under the Investor tab.
Speaker Change: Before we get started I'd like to direct you to the forward looking statement on slide two all figures discussed. This morning are in U S dollars unless otherwise stated.
Speaker Change: All of the ounce per ounce references discussed will be based on silver equivalent ounces sold unless otherwise indicated our silver equivalent references are based on gold to silver ratio of 70 951 to one on the call with me today is Chris Ritchie President and.
Nathan Eric Fier: Our silver equivalent references are based on a gold to silver ratio of 79.51 to 1. On the call with me today are Chris Ritchie, President, and Cliff Lafleur, Vice President of Operations, starting on slide three. Q1 marked a strong start to the year as we continued to exhibit our ability to deliver positive operational results and demonstrated our continued financial flexibility, with sales of 15,000 ounces of gold and 1.4 million ounces of silver for silver equivalent sales of 2.8 million ounces of gold.
Speaker Change: Cliff with floor, Vice President operations, starting on slide three.
Speaker Change: Q1 marked a strong start to the year as we continued to exhibit our ability to deliver positive operational results and demonstrated our continued financial flexibility.
Speaker Change: Sales of 15000 ounces of gold and 1.4 million ounces of silver four silver equivalent sales of two point.
Nathan Eric Fier: Six Million Ounces Exceeded Plan, positioning us favorably to deliver on 2024 guidance, in all sustaining costs in the corridor, was lower than planned but is expected to increase in future quarters with our 2024 guidance range of $15 to $15.90 per ounce sold, as reiterated.
Speaker Change: 6 million ounces exceeded plan.
Speaker Change: It's a niche positioning us favorably to deliver on cute.
Speaker Change: 2020 for guidance.
Speaker Change: And all sustaining costs.
In the quarter was lower than planned, but it is expected to increase in future quarters with our 2024 guidance range of 15 to $15.90 per ounce sold is reiterated.
Nathan Eric Fier: Our balance sheet remains one of the best of our silver peers and a significant strength to us. During the quarter, it has supported some large outflows related to 2023 taxes and duties as a standard course of business and the mobilization of our new mining contractor. We're also happy to report positive retained earnings of $21.5 million, a unique achievement in the mining industry and one we accomplished within only six quarters of commercial production.
Speaker Change: Our balance sheet remains one of the best.
Speaker Change: Our silver peers, and a significant strength to us during the quarter. It is supported.
Speaker Change: Some large outflows related to 2023 taxes and duties as a standard course of business and the mobilization of our new mining contractor.
Speaker Change: We are also happy to report positive retained earnings of $21 $5 million a unique achievement in the mining industry and one we accomplished with only within only six quarters of commercial production on.
Nathan Eric Fier: On the ESG front, we are excited to have initiated the process towards using renewable power at Las Chispas. We are working to implement solar power, which will help achieve strategic objectives while also supporting technology that utilizes silver. Northwest Mexico is an extremely desirable location for solar power, given the prominent role that silver plays in solar power and the Mexican economy. It's a logical transition. Renewable energy is not possible without mining, and we are excited to be part of the energy transition with a common-sense approach. I will now pass the call to Chris to discuss our financial results for the quarter.
Speaker Change: On the ESG front, we are excited to have initiated the process towards using renewable power at last year's fish were working to implement.
Speaker Change: Solar power, which will help achieve strategic objectives, while also supporting technology that utilizes silver.
Speaker Change: Northwest Mexico is extremely desirable location for solar power given the prominent roles that silver plays in solar power and Mexican economy, It's a logical transition renewable energy is not possible without mining and we are excited to be part of the entertainment energy transition.
Speaker Change: With a common sense approach.
Speaker Change: I will now pass the call to Chris to discuss our final natural results for the quarter.
Christopher Ritchie: Thanks, Eric. Good morning, everybody.
Christopher Ritchie: Thanks, Eric Good morning, everybody.
Christopher Ritchie: Now moving to slide four.
Christopher Ritchie: Now moving to slide four. In the quarter, we generated revenue of $63.6 million, and our cost of sales was $26.2 million. We are proud to have consistently delivered strong operating margins of approximately 60% since achieving commercial production, despite inflationary pressures and the volatility of the Mexican peso. One way we have accomplished this is through an active currency management program which has hedged the majority of our 2024 peso needs above the current levels and our guidance basis of 17 to 1. Net earnings in the quarter were $33.9 million, or $0.23 per share, and operating cash flow before change in working capital was $17.6 million, or $0.12 per share.
Christopher Ritchie: In the quarter, we generated revenue of $63 $6 million and cost of sales was $26 $2 million.
Speaker Change: We are proud to have consistently delivered strong operating margins of approximately 60% since achieving commercial production.
Speaker Change: Eight inflationary pressures and the volatility of the Mexican peso.
Speaker Change: One way we accomplish this is through an active currency management program, which is hedged the majority of our 2024 peso needs above the current levels and our guidance basis of 17 to one.
Speaker Change: Net earnings in the quarter was $33 $9 million or 23 per share and operating cash flow before change in working capital was $17 $6 million or <unk> 12 per share.
Christopher Ritchie: In the quarter, we benefited from a lower effective tax rate, which we expect to normalize in 2024. As planned and previously communicated, we had some large cash outflows in the quarter. The first was a planned payment of $26.2 million for 2023 taxes and mining duties. The second was a $7.5 million prepayment to our new mining contractor. Our financial strength provided us with the flexibility to support our new contractor while also reducing the overall cost of the contract by $1.5 million over five years. Our financial flexibility continues to allow us to make choices that offer long-term benefits while still remaining well-funded today. We look forward to growing our treasury assets again in 2024. Now, on slide five.
Speaker Change: In the quarter, we benefited from a lower effective tax rate, which we expect to normalize in 2024.
Speaker Change: As planned and previously communicated we had some large cash outflows in the quarter.
Speaker Change: The first was a planned payment of $26 $2 million for 2023 taxes in mining duties.
Speaker Change: The second was a $7.5 million prepayment to a new mining contractor our financial strength provides us with the flexibility to support our new contractor, while also reducing the overall cost of the contract by $1.5 million over five years.
Speaker Change: Our financial flexibility continues to allow us to make choices that offer long term benefits, while still remaining well funded today.
Speaker Change: We look forward to growing our treasury assets again in 2024.
Speaker Change: Now on slide five.
Christopher Ritchie: Treasury assets decreased by 13% or $14 million in the quarter, which was less than anticipated due to higher metal prices, lower costs, and higher sales than planned. Our silver and gold bullion on our balance sheet remains a core holding and was our strongest performing currency in the quarter. Despite not adding to our bullion holdings in the quarter, the value increased by 4% to $20 million as we saw strong metal prices through the quarter.
Speaker Change: Treasury assets decreased by 13% or $14 million in the quarter, which was less than anticipated due to stronger metal prices lower costs and higher sales than planned.
Speaker Change: Our silver and gold bullion on our balance sheet remains a core holding and it was our strongest performer performing currency in the quarter.
Speaker Change: Despite not adding to our bullion holdings in the quarter, we value the value increased by 4% to $20 million as we saw strong metal prices through the quarter.
Speaker Change: With metal prices currently trending higher than the Q1 average, we're glad to be providing greater exposure to gold and silver to our investors.
Christopher Ritchie: With metal prices currently trending higher than the Q1 average, we are glad to be providing greater exposure to gold and silver to our investors. As one of the only companies to hold metal on our balance sheet, we are glad to have the financial strength and flexibility to create greater exposure to our product. With this program, we strive to improve the returns we can make for shareholders and lower the impact of inflationary pressures. With that in mind, I will now pass it on to Cliff to discuss operations at Los Chico.
Speaker Change: As one of the only companies to hold metal on our balance sheet. We are glad to have the financial strength and flexibility to create greater exposure to our product with this program. We strive to improve the returns we can make for shareholders and lowered the impact of inflationary pressures.
Speaker Change: With that I will now pass it on to cliff to discuss operations at La <unk>.
Clifford Lafleur: Thanks, Chris. I'm now on slide six. Underground mining rates increased 90 tons per day from the previous quarter to 942 tons per day, benefiting from strong collaboration between the two contractors currently at the site. Overall, the mobilization of new contractors is largely on pace and will continue to progress through Q3 2024. We remain on track to achieve our 2024 ramp-up plan.
Thanks, Chris I'm now on slide six.
Cliff: Underground mining rates increased 90 tons per day from the previous quarter to 942 tons per day benefiting from strong collaboration between the two contractors currently at the site.
Speaker Change: Overall, the mobilization of the new contractors largely on pace and we'll continue to progress through Q3 2024.
Speaker Change: We remain on track to achieve our 2024 ramp up plans.
Clifford Lafleur: The Los Chispas plant averaged 1,026 tons per day in the quarter, a slight decrease from previous quarters due to planned downtime for maintenance that was completed ahead of schedule. The processing plant returned to planned availability rates in March. We are extremely proud that the plant recovered 2.6 million ounces with record process grades of 874 grams per ton and record silver equivalent recoveries of 98.3 percent. Achieving record grades and recoveries can be attributed to the operational flexibility we have created, the strong operating performance of our plant, and access to sizable stockpiles for blending consistent feed are significant operational advantages.
Speaker Change: The last piece of this plant averaged 1026 tonnes per day in the quarter, a slight decrease from previous quarters due to planned downtime for maintenance that was completed ahead of schedule. The processing plant returned to planned availability rates in March.
Speaker Change: We are extremely proud that the plant recover $2 6 million ounces with record processed grades of 874 grams per tonne and record silver equivalent recoveries of 98, 3%.
Speaker Change: Achieving record grades and recoveries can be attributed to the operational flexibility we have created.
Speaker Change: Operating performance at our plant and access to a sizable stockpiles for blending consistent feed or significant operational advantages.
Clifford Lafleur: Corporate ASIC in the quarter of $12.90 per ounce was lower than expected due to lower cash costs and lower sustaining capital spend than budgeted. However, the delay in sustaining capital spending is not expected to impact annual production, and capital expenditure is expected to increase through the remainder of the year. I'll now pass it back to Eric to conclude the presentation.
Speaker Change: Corporate ASIC in the quarter of $12 90 per ounce with lower than expected due to lower cash costs and lower sustaining capital spend than budgeted the delay in sustaining capital spending is not expected to impact annual production and spend is expected to increase through the remainder of the year I'll now pass it back to.
Speaker Change: Eric to conclude the presentation.
Nathan Eric Fier: Thanks, Cliff. Now on to slide seven, looking forward to the rest of 2024. The results of the quarter put us on track to meet 2024 guidance of 9.8 to 10.2 million ounces sold with an all-in sustaining cost within $15 to $15.90 per ounce sold. The underground mine ramp-up will continue to progress with a target to exit the year at 1,050 tons per day. We have been focused on infill and expansion drilling for some time now at Las Chispas, and this continued during the quarter.
Eric: Thanks, Cliff now onto slide seven and looking forward to the rest of 2024 the results of the quarter put us on track to meet 2024 guidance of $9 eight to $10 2 million ounces sold.
Speaker Change: And all in sustaining cost within 15 to $15.90 per ounce sold.
Speaker Change: Underground mine ramp up will continue to progress with a target to exit the year at 1050 tonnes per day.
Speaker Change: We have been focused on infill and expansion drilling for some time now and watch T space and this continued in the quarter drilling has targeted inferred resources outlined as high priority for conversions that are located in proximity to existing and planned underground development.
Nathan Eric Fier: Drilling has targeted inferred resources outlined as high priority for conversion that are located in proximity to existing and planned underground development. Approximately 10 million ounces were initially targeted with this drilling, with more detailed results provided in the MD&A. Results have confirmed mineral continuity in targets in the Bobby Kenora area and identified opportunities for further expansion of mineralization in the Bobby Canora Norte Spleen 3 vein and the Bobby Sewer vein. These results are being compiled and assessed for potential conversion to indicated resources.
Speaker Change: Approximately 10 million ounces were initially targeted with this drilling with more detailed results provided in the MD&A.
Speaker Change: Results have confirmed mineral continuity in targets in the Barbican aura area and identified opportunities for further expansion of mineralization.
Speaker Change: And the Bobby <unk>, North Te spleen, three vein and Bobby sure vein.
Speaker Change: These results are being compiled and assess for potential conversion to indicated resources.
Nathan Eric Fier: A shift in early stage exploration will be prioritized in H2 2024, including both early stage targeting at Las Chispas and continued regional work. Regional exploration is looking for nearby deposits that could eventually be trucked to Las Chispas for processing, and it will now focus on a number of priority targets that were assessed over the past 18 months. With higher metal prices in Q2 to date and larger one-time payments behind us, we expect our balance sheet to strengthen throughout 2024. We will also continue to execute on our capital allocation program, which includes strategic currency management and our bullion holding program.
Speaker Change: <unk> a shift in early stage exploration will be prioritized in each to 2024, including both early stage targeting it lost T space and continued regional work regional exploration is looking for nearby deposits that could eventually be trucked to loss of <unk> four.
Speaker Change: <unk> processing and will now focus on a number of priority targets that were assessed over the past 18 months.
Speaker Change: With higher metal prices in Q2 to date and larger one time payments behind us, we expect our balance sheet to strengthen throughout 2024.
Speaker Change: We will also continue to execute on our capital allocation program, which includes strategic currency management and our bullion holding program.
Operator: That wraps up our formal commentary for today. Operator, please open the lines for questions. Gentlemen, thank you and to our phone audience.
That wraps up our formal commentary for today operator, please open the lines for questions.
Operator: Gentlemen, thank you. And to our phone audience listening in, if you would like to ask a question, please press the star and 1 on your telephone keypad. Pressing star and 1 will place your line into a queue, and we'll take your questions one at a time. Once again, ladies and gentlemen, that is star and 1 on your telephone keypad. If you would like to ask a question at this time, we'll pause for just a moment to allow everyone a chance to signal. We'll take our first question today from John Sklotnik at Desjardins. Yeah, thanks guys. And yeah, congrats on a great quarter.
Speaker Change: Gentlemen, thank you and to our phone audience, joining if you would like to ask a question. Please press the star and one on your telephone keypad.
Speaker Change: Starting on place your line into acute and we will take your questions. One at a time once again, ladies and gentlemen that is star and one on your telephone keypad. If you would like to ask a question at this time and we will pause for just a moment to allow everyone a chance to signal.
John Sklotnik: Yeah, thanks guys. And yeah, congrats on a great quarter and on getting to positive retained earnings. Unfortunately, you don't see that too often in the industry. Just curious about the other income line of the financials and whether that might be related to the option strategy with the bullion holding.
Christopher Ritchie: The other income for Bullion Holdings. Yeah, part of it is related to the bullion holdings, John, and other derivatives.
Speaker Change: We will take our first question today from John Slotnick days right Dan.
Yes, thanks, guys and congrats on a great quarter and on getting to positive retained earnings that question.
Speaker Change: So you don't see that too often in the industry.
Speaker Change: Just curious on the other income line in the financials and whether that might be related to the.
Speaker Change: Option strategy with a Boolean holdings.
Speaker Change: Okay.
Speaker Change: The other income for the boy in holdings.
Yes part of it part of it is related to the <unk> Holdings John.
Speaker Change: And other derivatives.
John Sklotnik: Okay, interesting. Yeah, that was just out of curiosity.
Speaker Change: Okay interesting.
Speaker Change: Curiosity I noticed this is.
Speaker Change: The question.
Speaker Change: And I guess on that you know the cash build is impressive and the Boolean holding strategy has been effective.
John Sklotnik: I know it's a positive question. And I guess on that, you know, the cash build is impressive, and the Boolean holding strategy has been effective. Of course, as an analyst, I'm going to have to ask, so how do you expect to deploy that cash balance? Do you think you'll use your share price, and if you're kind of looking in this environment at M&A?
Of course, as an analyst day I'm going to have to ask though how do you expect to deploy that cash balance whether you think you'll use your share price and if you're looking in this environment.
Speaker Change: At M&A.
Christopher Ritchie: I think, first and foremost, having a strong cash balance is a rarity, so using that flexibly and opportunistically is something we did previously when the share price was weak. Having an NCIB in place or being able to hold on to metal at low prices or to look at M&A and other potential targets, those are all things that we are really happy to have the flexibility to do. For now, exploration is still something we are closely monitoring and spending a lot of time and effort trying to advance.
Speaker Change: I think first and foremost having a strong cash balance is a rarity so using that flexibly and opportunistically is something we did previously when the share prices week, having an NCI be in place or being able to hold onto metal at low prices.
Speaker Change: Or to look at M&A and other and other potential targets like those are all things that we are really happy to have the flexibility to do.
Speaker Change: For now exploration is still something we're closely monitoring and spending a lot of time and effort trying to advance.
Speaker Change: So yeah, I think first and foremost is we want to provide the benefits of flexibility to the shareholders.
Christopher Ritchie: I think, first and foremost, we want to provide the benefits of flexibility to the shareholders. For M&A and that target, that is obviously something on the list of things to spend time on. Having that flexibility is also something unique that we think other people would benefit from. One of the things on the list to do, John.
For M&A in that target I mean, that's obviously something on the list of things to spend time on.
Speaker Change: So having that flexibility is also something unique that we think other people would benefit from that flexibility. So one of the things on the list to do John.
John Sklotnik: Okay, so appreciate that. And on potential acquisitions, would you guys look within Mexico? It feels like you've got a bit of a competitive advantage there, or are you looking to diversify outside?
Speaker Change: Okay, I appreciate that and I guess on the.
Speaker Change: Potential acquisitions that would you guys look.
Speaker Change: Within Mexico.
John Slotnick: So you've got a bit of a competitive advantage there or are you looking to diversify outside.
Christopher Ritchie: I mean, quality assets and minimizing risks as we look for growth is a priority. You know, obviously, in Mexico, the difference between some of the permitting challenges for open pit and underground, so I think obviously we would want assets that have that lower risk profile associated with them. But again, if there are quality assets in other areas, we are open minded.
I mean quality assets and minimizing risks as we look for growth is a priority.
John Slotnick: Obviously in Mexico, the difference between some of the permitting challenges for open pit and underground. So I think obviously, we would want a assets that have that lower risk profile associated with them, but again, if there are quality assets in other areas. We are open minded.
John Sklotnik: Okay, and last one for me, just on that renewables project, I'm just wondering if you could give some details on the cost of the project, expected operational benefits once that's online, and whether you might have a project NPV.
Speaker Change: Okay and last one for me just on that renewables project. Just wondering if you could give some details on the cost of the project expected Opex benefits once that's online and whether you might have a project NPV.
Christopher Ritchie: Sure, so first and foremost, what we have done is we've signed a contract with a third-party provider of solar energy. The facility that we're contracted with or working on getting that contract with is already up and running. It's fully built.
Speaker Change: Sure So first and foremost.
Speaker Change: What we have done is we've signed a contract with a third party provider of solar the facility that were contracted or working on getting that contract with is already up and running it's fully built the capacity is there we'd still be using the same grid as we're currently using.
Christopher Ritchie: The capacity is there. We'd still be using the same grid as we're currently using, so there's no disruption or changes for us to do. So again, it's kind of a no-risk change in source of power. What we do require is authorization. So right now, we're working on that authorization and hope to have that in place so we can implement this in 2025.
Speaker Change: Theres no disruption or changes for us to do so again, it's kind of a non a no risk change in source of power.
Speaker Change: What we do requires permanent so right now we're working on that permitting and hope to have that in place. So we can implement this in 2025 the benefits to us are quite nice the contract we have in place would save us approximately $1 $5 million per year.
Christopher Ritchie: The benefits to us are quite nice. The contract we have in place would save us approximately $1.5 million per year and would give us that fixed price for three years. So in Mexico, for the last pretty long period of time, energy prices have gone up about 7% per year. So again, not only do we get the cost savings, but we get the locked-in price. So that's quite nice. And then the added benefit is we would reduce our greenhouse gas emissions by approximately 70%, again, while using solar panels containing above 90,000 ounces of silver.
Speaker Change: And would give us that fixed price for three years, so in Mexico for the last.
Speaker Change: Pretty long period of time energy prices have gone up about 7% per year. So again, not only do we get the cost savings.
Speaker Change: We get them locked in right. So that's that's quite nice and then the added benefit as we would reduce our greenhouse gas emissions by approximately 70%.
Speaker Change: While using solar panels, using about 90000 ounces of silver.
John Sklotnik: Awesome. That's a great project there. Appreciate that and all the questions for me. Congratulations guys.
Speaker Change: Awesome that that'd be great project, there I appreciate that and all the questions from me Congrats again.
Sean: Thanks, Sean.
Sean: Dan Ellsworth with World Micro you have our next question.
Operator: Dan Ellsworth with World Micro. Now, you have our next question.
Dan Ellsworth: Yeah, just quick clarification with respect to the share buyback versus allocating capital in the treasury for, you know, kind of gold, silver, and those holdings. Is it safe to assume that the priority is really to kind of maximize the treasury holdings of gold and silver over potential share buybacks at this point in time?
Speaker Change: Yes, just quick clarification with respect to the share buyback versus allocating capital in the treasury.
Speaker Change: You know kind of.
Speaker Change: Gold silver and those holdings I is it safe to assume that.
Speaker Change: The priority is really to kind of maximize the treasury holdings gold silver over a potential share buybacks at this point in time.
Speaker Change: Okay.
Christopher Ritchie: Morning Dan, hope you're well. Chris here.
Dan Ellsworth: Good morning, Dan Hope you're well.
Chris here.
Speaker Change: The priority first and foremost is to have that flexibility and given the cash outflows. We had in Q1. The main point was to see how that all settled out the framework that we have in place around the balloon the holding is to make sure that we're debt free we have enough cash to support operations and maintain all flexibility required to make sure that.
Christopher Ritchie: The priority, first and foremost, is to have that flexibility, and given the cash outflows we had in Q1, the main point was to see how that all settled out. The framework that we have in place around the bullion holding is to make sure that, you know, we're debt-free, we have enough cash to support operations, and maintain all the flexibility required to make sure that we can do all the right things for the operation.
Speaker Change: We can do all the right things for the operation.
Christopher Ritchie: But that said, if we're able to increase those treasury holdings, our ability to hold bullion, you know, as a percentage of those treasury holdings certainly can grow with the cash flows in total. So yeah, we definitely believe in the product, we definitely believe in it as a core holding on the balance sheet, and we definitely want to give more exposure to our shareholders.
Speaker Change: But that said if were able to increase those treasury holdings, our ability to hold bullion.
Speaker Change: As a percentage of those Treasury holdings, certainly can grow with the cash flows in total so yeah. We definitely believe in the product we definitely believe in it as a core holding on the balance sheet and we definitely want to get more exposure to our shareholders.
Dan Ellsworth: Sounds good, I appreciate it, and congratulations on a great quarter, guys.
Speaker Change: Sounds good I appreciate it and congratulations on the great quarter guys. Thanks.
Speaker Change: Yes.
Operator: Our next question today comes from Steven Sook at Stiefel.
Speaker Change: Our next question today comes from Stephen Suck at Stifel.
Speaker Change: Okay.
Steven Sook: Yeah, thanks. Congratulations on another strong quarter here. So Dan answered part of my question here, but just kind of to follow on, maybe just how you think about the bullion strategy and the amount held. I understand this quarter you wanted to manage the large tax bill and the payment to the new contractor, et cetera, but I guess how do you, you previously mentioned keeping 12 months worth of CapEx in bullion. You know, is this still the strategy, or is it more of a percentage of And maybe just as a part two, you know, is there a scenario in which you trim some of that bullion holding? Yeah, that's kind of just some calls around there would be great. Thanks.
Stephen Suck: Yeah. Thanks, Congrats on another strong a strong quarter here.
So Dan took part of my question here, but just kind of a follow on.
Speaker Change: Maybe just how you think about the bullion strategy and the amount how old I understand this quarter you wanted to manage to the large tax bill in the payment to the new contractor et cetera, but I guess, how do you you've previously mentioned keeping 12 months worth of Capex in bullion.
Speaker Change: The strategy or is it more of a percentage of the total Treasury holdings and maybe just as a part two is there a scenario in which you you trimmed some of that debt that bullion are holding.
Speaker Change: Yeah, Yeah, that's kind of just some color around there would be great. Thanks.
Christopher Ritchie: Yeah, great. I mean, first and foremost, as we said, we want to give our investors more exposure to gold and silver. It is a currency of choice for people, and we believe an ounce that we hold above the ground is worth more than an ounce in the ground and gets all of the leverage associated with price increases. That said, to your point about, you know, there is volatility in gold and silver; it does move up and down, and as we relate, you know, how much to be holding and when to be buying and selling, it is related to the cost to produce an ounce.
Speaker Change: Yeah, Great I mean first and foremost as we said we wanted to give our investors more exposure to gold and silver it as a currency of choice for people and we believe an ounce that we hold above the ground is worth more than that Alex in the ground and get all of the leverage associated with price increases.
Speaker Change: That said to your point about you know there is volatility in gold and silver it does move up and down and as we relate how much to be holding and when to be buying and selling.
Speaker Change: It is related to the cost to produce an ounce. So when prices are low you know we want to have the ability to be.
Christopher Ritchie: So when prices are low, you know, we want to have the ability to be price makers instead of price takers, and when prices are high, we would hedge our bullion just like we would hedge any other currency.
Speaker Change: Nice makers instead of price takers.
Speaker Change: And when prices are high we would hedge our bullying just like we would hedge any other currency.
Steven Sook: Okay, yeah, makes sense. No, I appreciate that. That's it for me. I'll open the line for anyone else.
Speaker Change: Okay, Yes, it makes sense I appreciate that and that's it for me I'll open the line for anyone else.
Operator: And once more to our phone audience today, that is Star and One. If you would like to ask a question, we'll go next to Robert McCleary.
Speaker Change: And once more to our phone audience today that is star in one if you would like to ask a question. We will go next to Robert Mccleary private shareholder.
Robert Mccleary: My question has been answered. Keep up the good work. Thank you. Thanks, Robert. And to our audience, if you find that your question has been answered before, you may remove yourself from the queue simply by pressing the pound key. Once again, ladies and gentlemen, that is star and one, and we'll pause for a moment to give everyone a chance to signal.
Robert Mccleary: Good morning.
Robert Mccleary: My question has been answered.
Speaker Change: Keep up the good work thank you.
Speaker Change: Thanks Robert.
Speaker Change: And to our audience. If you find that your question has been answered prior you may remove yourself from the queue simply by pressing the pound case once again, ladies and gentlemen that is star in one and we'll pause for a moment to give everyone a chance to sickle.
Operator: And we have no signals from our audience. I'll turn it back to our management group for any additional or closing remarks.
Speaker Change: And we have no signals from our audience I will turn it back to our management group for any additional or closing remarks.
Nathan Eric Fier: Thank you everybody for attending the Silvercrest Metals Q1 2024 results call, and have a great day.
Speaker Change: Thanks, everybody for attending the Silvercrest metals Q1, 2024 results call and have a great day.
Operator: This does conclude today's teleconference, and we thank you all for your participation. You may now disconnect.
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Speaker Change: This does conclude today's teleconference and we thank you all for your participation you may now disconnect.
Speaker Change: Okay.
Speaker Change: [music].
Speaker Change: Yeah.
Speaker Change: Okay.
Speaker Change: [music].
Speaker Change: Yeah.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Yeah.
Speaker Change: [music].
Mhm.
Speaker Change: [music].