Q2 2024 Lundin Mining Corp Earnings Call

Operator: Good morning, ladies and gentlemen, and welcome to the London Mining Q2 2024 financial results and webcast conference call. At this time, all lines are in a listen-only mode.

Good morning, ladies and gentlemen, and welcome to London mining Q2, 'twenty 'twenty four financial results and webcast conference call. At this time all lines are in a listen only mode. Following the presentation. We will conduct a question and answer session. If at any time. During this call you require immediate assistance.

Operator: Following the presentation, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Thursday, July 31st, 2024. I would now like to turn the conference over to Jack Lundin. Please go ahead.

Please press star zero for the operator this call is being recorded on Thursday July 31st 2024, I would now like to turn the conference over to Jack London. Please go ahead.

Jack Lundin: Welcome, everyone, and thank you for joining Lundin Mining's second quarter conference call. For those that were on our corporate update call on Tuesday, where we announced the joint acquisition of Philo with BHP, thank you for joining today as well. Yesterday, after market close, we reported our operating and financial results for Q2. The press release and presentation are available on our website under our Investors section. All figures presented today are in US dollars unless otherwise noted.

Jack London: Welcome everyone and thank you for joining Lundin mining second quarter conference call for those that were on our corporate update call on Tuesday, where we announced the joint acquisition of CLO with BHP. Thank you for joining today as well.

Speaker Change: Yesterday after market close we reported our operating and financial results for Q2, the press release and presentation are available on our website under our investors section. All figures presented today are in U S dollars unless otherwise noted.

Jack Lundin: Before we start the presentation, I would like to remind our listeners that the call may contain forward-looking information, and this information, by its nature, is subject to risks and uncertainties. As such, actual results may differ materially from the views expressed today.

Speaker Change: Before we start the presentation I would like to remind our listeners that the call may contain forward looking information and this information by its nature is subject to risks and uncertainties as such actual results may differ materially from the views expressed today I would encourage you to read the cautionary note that accompanies our second quarter MD&A along with the Red.

Jack Lundin: I would encourage you to read the cautionary note that accompanies our second quarter MD&A, along with the relevant filings on CDAR. These documents are also available on our website. Today on the call are three other members of our senior executive team. Teitur Poulsen, our Executive Vice President and CFO, Juan Andres Morel, our Executive Vice President and COO, and Nathan Monash, our Vice President of Sustainability. Briefly, before we get into the Q2 results, I wanted to highlight the transaction we announced yesterday.

Jack London: And filings on SEDAR.

Jack London: Documents are also available on our website.

Speaker Change: Today with me on the call are three other members of our senior executive team tighter.

Speaker Change: Tighter Paulson, our executive Vice President and CFO.

Speaker Change: Grace morale, our executive Vice President and C O O and Nathan Monash, our vice president of sustainability.

Speaker Change: Briefly before we get into the Q2 results I wanted to highlight the transaction, we announced yesterday, we look forward to working with BHP and embarking on this multi decade partnership to develop the Vicuna district in Argentina. This transaction transforms our growth profile and solidifies our belief that the district has the potential.

Jack Lundin: We look forward to working with BHP and embarking on this multi-decade partnership to develop the Vicua District in Argentina. This transaction transforms our growth profile and solidifies our belief that the district has the potential to be world-class in both scale and quality. For anyone that missed yesterday's conference call, there is a replay available on our website, and I encourage you to listen to it and get the full overview of the highlights of the acquisition and partnership. Now into Q2 2024.

Speaker Change: To be world class in both scale and quality.

Speaker Change: And the one that missed yesterday's conference call. There is a replay available on our website and I encourage you to listen to it and get the full overview of the highlights of the acquisition and partnership.

Speaker Change: Now into Q2 2024.

Jack Lundin: Quarterly copper production for the company was 80,000 tons. As we have previously discussed, our copper production profile is weighted to the second half of the year, and we expect to see higher grades and throughput in Q3 and Q4 at Candelaria that will drive production. We're still on track to meet our annual copper guidance, which is between 366,000 and 400,000 tons. Additionally, 47,000 tons of zinc and 32,000 ounces of gold were produced in the quarry.

Speaker Change: Quarterly copper production for the company was 80000 tons as we have previously discussed our copper production profile is weighted to the second half of the year and we expect to see higher grades and throughput in Q3, and Q4 I candle area that will drive the production.

Speaker Change: We're still on track to meet our annual copper guidance, which is between 366000 to 400000 tonnes.

Speaker Change: 47000 tons of zinc and 32000 ounces of gold were produced in the quarter.

Jack Lundin: Operationally, the corridor was affected by unscheduled maintenance and lower mining rates that impacted production at several of our sites. Nickel production at EGLE was impacted by additional ramp rehabilitation work that limited ore production from EGLE East. We have had to revise guidance at EGLE for the remainder of the year.

Speaker Change: Operationally the quarter was affected by unscheduled maintenance and lower mining rates that impacted production at several of our sites.

Speaker Change: Nickel production at Eagle was impacted by additional re ramped rehabilitation work that limited ore production from Eagle East.

Speaker Change: We have had to revise guidance at Eagle for the remainder of the year.

Jack Lundin: After the quarter, we exercised our option to increase our ownership in Casaronis to 70%, further enhancing our presence in the region and strengthening our overall copper-dominant portfolio of high quality base metal mines. We had a very strong financial performance this quarter due to the increase in commodity prices and generated $461 million in adjusted EBITDA and $338 million in free cash flow from operations. This quarter, we announced our regular quarterly dividend of $0.09 Canadian per share, which makes up part of the annualized dividend of $0.36 Canadian per share.

After the quarter, we exercised our option to increase our ownership in <unk> to 70% further enhancing our presence in the region and strengthening our overall copper dominant portfolio of high quality base metal mines.

Speaker Change: We had a very strong financial performance this quarter with the increase in commodity prices and generated 461 million in adjusted EBITDA and $338 million in free cash flow from operations.

Speaker Change: This quarter, we announced our regular quarterly dividend of nine cents Canadian per share, which makes up part of the annualized dividend of 36 cents Canadian per share.

Jack Lundin: In addition, we released our annual 2023 Sustainability Report that highlights the company's material, environmental, health, and safety, governance, and social performance during the year. We are committed to the responsible production of critical minerals and believe that mining can be a platform for sustainable development. I will now hand the call over to Nathan Monash, our VP of Sustainability, to talk about the highlights from the report before going into the results for the quarter.

Speaker Change: In addition, we released our annual 2023 sustainability report that highlights the companys material environmental health and safety governance and social performance. During the year. We are committed to the responsible production of critical minerals and believe that mining can be a platform for sustainable development.

Nathan Monash: I will now hand, the call over to Nathan Monash, our VP of sustainability to talk about the highlights from the report before going into the results of the quarter.

Nathan Monash: Thank you Jack.

Nathan Monash: Earlier this month, we published our 2023 Annual Sustainability Report, which reports on our efforts over the last year to address material sustainability topics and further integrate our sustainability strategy into Lundin Mining's plans for growth. Sustainability is key to who we are as a company, and this report highlights our commitment to creating shared value. As many of our long-term shareholders are aware, Lundin Mining has been reporting on our sustainability performance in a standalone document since 2010, demonstrating our commitment to transparency and responsible mining.

Nathan Monash: Earlier this month, we published our 2023 annual sustainability report, which reports on our efforts over the last year to address materials sustainability topics and further integrate our sustainability strategy into lumi mining plans for growth.

Nathan Monash: The inability is key to who we are as a company and this report highlights our commitment to creating shared value.

Nathan Monash: As many of our long term shareholders are aware Muni mining has been reporting on our sustainability performance in a standalone documents since 2010.

Nathan Monash: Demonstrating our commitment to transparency and responsible mining.

Nathan Monash: We are proud to highlight that we achieved the Coppermark certification at Candelaria and Casarones, which is a leading global assurance framework for sustainability performance in the copper industry. I would also like to note that we have continued to reduce our greenhouse gas emissions through new power purchase agreements from Renewable Resources. We continue to make progress on our decarbonization plans and to achieve our goal of a 35% reduction by 2030 compared to our 2019 baseline.

Nathan Monash: We are proud to highlight that we achieved the copper mark certification that candle area and Kessler on it which is a leading global assurance framework for sustainability performance in the copper industry.

Nathan Monash: I would also like to note that we have continued to reduce our greenhouse gas emissions through new power purchase agreements from renewable resources, we continue to make progress on our de carbonization plans and to achieve our goal of about 35% reduction by 2030 versus our 2019 baseline.

Nathan Monash: We will also continue to work with host communities in 2023 to address common objectives in education, health, culture, and economic development. Our investments in 2023 totaled approximately $6.1 million. For a complete list of highlights, I would encourage everyone to go through the report that can be found on our website under the sustainability section. I will now pass the call over to Juan Andres, our Chief Operating Officer, to talk about our production results.

Nathan Monash: We also continue to work with host communities 2023 to address common objectives in education health culture and economic development.

Nathan Monash: Our investments in 2023 totaled approximately $6 1 million.

Nathan Monash: For a complete list of highlights I would encourage everyone to go through the report it can be found on our website under the sustainability section.

Speaker Change: I will now pass the call over to Juan Andres, Our Chief operating officer to talk about our production results.

Juan Andres Morel: Thank you, Nathan, and good morning, everyone. The company is tracking to budget and production guidance on a consolidated basis for copper, gold, and zinc. As mentioned earlier, copper production will be weighted towards the second half of the year, primarily driven by grade profiles at Candelaria, Chapada, and Neves Corvo. Copper production for the company was 80,000 tons for the quarter and 168,000 tons for the first half of the year. Gold production for the quarter totaled approximately 32,000 ounces.

Juan Andres Morel: Thank you Nathan and good morning, everyone.

Juan Andres Morel: The company striking to budget and production guidance on a consolidated basis for copper gold and saying that's.

Juan Andres Morel: As mentioned earlier copper production will be second half of the year weighted primarily driven by a great profile such kind of idea of Chubb had I never callable.

Speaker Change: Copper production for the company was 80000 tons for the quarter and 168000 tons for the first half of the year.

Speaker Change: Gold production for the quarter totaled approximately 32000 ounces as I mentioned earlier, great profiles that kind of idea in Japan that will contribute to a stronger second half of the year for gold production.

Juan Andres Morel: As mentioned earlier, great profiles at Candelaria and Chapada will contribute to a stronger second half of the year for gold production. At Candelaria, production was 31,000 tons of copper and 17,000 ounces of gold. Production during the quarter was impacted by mining rates, which limited access to higher-grade ore from phase 11 in the open pit. Mining rates were slower than anticipated due to interference with historic underground mining stoves in Phase 11.

Speaker Change: Kind of idea production was 31000 pounds of copper and 17000 ounces of gold production during the quarter was impacted by mining rates, which limited access to higher grade ore from phase 11 in the open pit.

Speaker Change: Mining rates were slower than anticipated due to interference with historic underground mining stopes and face 11, these delays pushed higher grade ore into the third quarter.

Juan Andres Morel: This delay pushed higher-grade ore into the third quarter, but we expect production at Candelaria to be approximately 60% weighted to the back half of the year, where grades will improve to 0.7 to 0.9% copper. We have started to see some of these grades come through the mill in July already. Production at Candelaria is tracking to budget and still on target to meet guidance for the year.

Speaker Change: We expect production at Candelaria to be approximately 60% weighted to the back half of the year, where grades will improve 2.72, 0.9% copper we have started to see some of these grades come through their meal in July already.

Speaker Change: Reduction that kind of idea is tracking to budget and still on target to meet guidance for the year.

Juan Andres Morel: Cacerones produced 30,000 tons of copper this quarter. Higher-than-anticipated grades were partially offset by lower throughput and recoveries in the mill. Cacerones has experienced a challenging winter this year. Prolonged snowstorms limited tailings deposition for several days, which restricted mill throughput, while unscheduled maintenance events impacted mill availability. Cacerones Copper Guidance has been increased to 124,000 to 135,000 tons of copper for the year, reflecting production results from the first half of the year. However, as mentioned earlier, guidance at EGLE has been reduced, which upsets the increase at Cacerones, and overall consolidated copper guidance remains unchanged. During the quarter, Chapada produced 9,000 tons of copper and 15,000 ounces of gold.

Speaker Change: Got it on S produced 30000 tonnes of copper at this quarter.

Speaker Change: Other than anticipated grades were partially offset by lower throughput and recoveries in the mill.

Speaker Change: I said honestly has experienced a challenging winter this year prolonged snow storms limited tailings deposition for several days, which restricted mill throughput, Hawaii unscheduled maintenance events impacted mill availability.

Speaker Change: Got it honest copper guidance has been increased to 124000 to 135000 tons of copper for the year, reflecting production results from the first half of the year.

Speaker Change: As mentioned earlier guidance at igo has been reduced which offsets the increased cost of doing this on an overall consolidated copper guidance remains unchanged.

Speaker Change: During the quarter chop up produced 9000 tonnes of copper and 15000 ounces of gold.

Juan Andres Morel: Lower recoveries from additional stockpile feed and unplanned downtime to repair a conveyor belt impacted production during the quarter. We plan grades and throughput to pick up in the second half of the year. Included in other copper production is Neves Corvo, which produced 7,000 tons, Zink Ruben, which produced 700 tons, and Eagle, which generated 1,600 tons of copper for the quarter. Nevis Coral Copper production is expected to be on the lower end of the guidance range for the year. Zinc production improved over the last quarter to 47,000 tons, and we expect it to improve further in Q3 and Q4. Neves Corvo sink production was 26,000 tons.

Speaker Change: Lower recoveries from additional stockpile feed and unplanned downtime to repair a conveyor belt impacted production during the quarter.

Speaker Change: We planned grades and throughput to pick up in the second half of the year.

Speaker Change: Included in other copper production is nourished corvo, which produced 7000 tons of zinc Ruben, which produced 700 tons, an ego, but generated a 1600 tons of copper for the quarter.

Speaker Change: Carville copper production is expected to be on the lower end of the guidance range for the year.

Speaker Change: Zinc production improved over the last quarter to 47000 tonnes and we expect it to improve further in Q3 and Q4.

Speaker Change: Corvo zinc production was 26000 pumps I've never corvo lower grades were realized due to change in mining sequencing.

Juan Andres Morel: At Neves Corvo, lower grades were realized due to a change in mining sequencing. Higher grades from Lombardor South were replaced with lower grades from Neves South. Mining grades in Lombardor South were impacted by additional backfill and development work, but we expect these to improve in the next quarter. During the quarter, ZincGruben produced 22,000 tons of zinc, which was in line with the budget, an improvement over the first quarter. We expect zinc prices to improve slightly over the remainder of the year.

Speaker Change: I agree from Lambert or south were replaced with lower grades from never salt mining grades and Lombardo South were impacted from additional backfill and development work. We expect this to improve in the next quarter.

Speaker Change: During the quarter zinc Rubin produced 22000 tons of zinc, which was in line with the budget and improvement over the first quarter, we expect zinc grades to improve slightly over the remainder of the year.

Juan Andres Morel: Nickel production was 1700 tons. During the quarter, a fall of ground in the lower ramp limited production from Eagle East. Additional ramp rehabilitation work was required, which impacted access to Eagle East and reduced mining rates. It is expected that the mine will now produce 7,000 to 9,000 tons of nickel for the year and 5,000 to 7,000 tons of copper. Operationally, our assets are tracking to guidance with the exception of EGLE.

Speaker Change: Nickel production was 1700 tons during the quarter a fall of ground in the lower ramp limited production from Eagle East.

Speaker Change: Additional ramp rehabilitation work was required which impacted access to the Eagle east and reduced mining rates. It is expected that the mine will now produce 7000 to 9000 tonnes of nickel for the year on 5000 to 7000 tons of copper.

Speaker Change: Operationally our assets are tracking to guidance with the exception of Eagle, we anticipate higher grades in the second half of the year, along with reduced maintenance and weather interruptions, all of which will allow us to meet our annual guidance goals.

Juan Andres Morel: We anticipate higher grades in the second half of the year, along with reduced maintenance and weather interruptions, all of which will allow us to meet our annual guidance goal. I will now turn the call over to Teitur to provide a summary of our financial results.

Speaker Change: I will now turn the call over to tighter to provide a summary on our financial results.

Teitur Poulsen: Thank you, Juan Orest, and good morning, everybody. Higher commodity prices in the second quarter led to improved margins, and we had a record revenue in the second quarter of 1.1 billion. Our revenue remains highly leveraged to copper, with the metal generating 74% of the revenue mix. Zinc and gold contributed 9% and 5%, respectively, and nickel contributed 3%. Our South American assets contributed approximately 76% of revenue and represent a key area of growth for the company. Candelaria and Casa Rona contributed 34% and 31%, respectively, for a combined 65%.

Teitur Poulsen: Thank you Andreas and good morning, everybody.

Teitur Poulsen: Higher commodity prices in the second quarter led to improved margins and we had a record revenue in the second quarter of $1 1 billion.

Teitur Poulsen: Our revenue remains highly leveraged to copper with the metal generating 74% of the revenue mix sinking go contribute that line and 5%, respectively and nickel contributed 3%.

Teitur Poulsen: Our South American assets contributed approximately 7% to 6% of revenue and represent a key area of growth for the company.

Larry: Larry I mean costs are going to contribute to a 34% and 31% respectively for a combined 65%.

Teitur Poulsen: Now looking at volume sold and realized pricing. During the period, we sold 79,000 tons of copper at a realized price of $4.79 per pound of copper and 39,000 tons of zinc at a realized price of $1.49 per pound. As we discussed last quarter, we hedged a portion of the copper production in May to lock in a pricing floor. During the quarter, the company settled hedges on 21,500 tons of copper with a pricing floor of 410 per pound and a pricing ceiling of 452 per pound.

Larry: Now looking at volumes sold and realized pricing.

Larry: During the period, we sold 17 9000 tonnes of copper at a realized price of $4 79 per pound of copper and 39000 tons of zinc at a realized price of $1 49 per pound.

Larry: As we discussed last quarter, we hedged a portion of the copper production in may to lock in a pricing floor.

Larry: During the quarter the company settled hedges on 21000 apartments tons copper with a pricing floor of $4 10 per pound and a price ceiling of $4 52 per pound.

Teitur Poulsen: And given the average copper price during May, the hedge resulted in a marginal loss of $3.5 million. Revenue increased quarter over quarter, largely driven by commodity pricing and provisional pricing impacts, with provisional pricing adjustments from prior periods leading to a positive impact of $95 million during the quarter. Approximately 78,800 tons of copper were provisionally priced at $4.34 per pound at the end of Q2 and remain open for final pricing adjustments, as did 17,900 tons of zinc at $1.31 and 255 tons of nickel at $7.75 per pound.

Speaker Change: Given the average copper price do you relate the hedged resulted in a marginal loss of $3 $5 million.

Speaker Change: Revenue increased quarter over quarter, largely driven by commodity pricing and provisional pricing impacts.

Speaker Change: Provisional pricing adjustments from prior periods, leading to a positive impact of 95 million during the quarter.

Speaker Change: Approximately 78800 tonnes of copper were provisionally priced at $4 34 per pound at the end of Q2 and remain open for final pricing adjustments as states 17900, Tulsa zinc that's $1 31 in 255 tonnes of nickel at $7 75 per pound.

Teitur Poulsen: Production costs have been stable across our asset base this year. In Q2, total costs were $606 million, which is in line with previous quarters. Production cost increases from the previous quarter of around $40 million are mainly due to higher mining costs at Candelaria and maintenance costs at Cacerloni and Ciapatta. As shown on the charts to the right, our unit costs are trending in line with our absolute production costs.

Larry: Production costs have been stable across our asset base this year.

Larry: In Q2 total costs were $606 million, which is in line with previous quarters.

Larry: Production cost increases from the previous quarter of around 40 million are mainly due to higher mining cost at candelaria and maintenance cost cuts at all in the enterprise.

Larry: As shown on the charts to the right our unit costs are trending in line with our absolute production costs.

Teitur Poulsen: With our annual production profile being second half weighted, we are on track to meeting our unit cash cost guidance at all sites, with the exception of Eagle, which has been revised upward to $3.20 to $3.40 per pound nickel. Total capital expenditure in concluding sustaining and expansionary activities was $255 million for the quarter and $524 million for the first half of the year. With our guidance for the full year now revised downward to $1,020,000,000, reflecting a $45,000,000 reduction in guidance. The revised guidance mainly relates to reduce carbon expenditure on Casa Rona, Nevis, and St. Grubin.

Larry: With our annual production profile being second half weighted we are on track to meeting our unit cash cost guidance at all sites with the exception of vehicle, which has been revised upward to treat dollars 20 to $3 40 or problems.

Larry: Total capital expenditure, including sustaining and expansionary Capex was $255 million for the quarter and 524 million for the first half of the year.

Larry: With our guidance for the full year revised downward to $1 billion and $20 million, reflecting a $45 million reduction in guidance.

Larry: This guidance, mainly relates to reduce capex spending on costs around that nervous and sync Ruben.

Teitur Poulsen: At Cosi Maria, we spent 87 million during the second quarter and have spent 143 million for the first half of the year versus a full year guidance of 225 million. The capital expenditure in the second quarter was primarily related to field activities for the water program, geotechnical studies, road maintenance works, and payment of long-lead items. Our key financial metrics for the second quarter are presented on slide 17. We generated adjusted EBITDA of $461 million, and adjusted operating cash flow was $370 million. Our earnings per share attributable to Lundin Mining shareholders amounted to 16%.

Speaker Change: Oh, sorry, Yeah, we spent 87 million during the second quarter and have spent 143 million for the first half of the year versus our full year guidance of $225 million.

Larry: The corporate expenditure in the second quarter, primarily related to field activities for the Walter program Geotechnical Studies and road maintenance works and payment of long lead items.

Larry: Our key financial metrics for the second quarter are presented on slide 17.

Larry: We generated adjusted EBITDA of 461 million and adjusted operating cash flow was $370 million.

Larry: Our earnings per share attributable to lundin mining shareholders amounted to 16.

Teitur Poulsen: Our operating cash flow amounted to $492 million and benefited from a release of working capital of $122 million during the quarter, which was expected due to the change in payment terms on some of the sales contracts, as we mentioned last quarter. Our adjusted operating cash flow, which excludes movement in working capital, amounted to $370 million, as previously mentioned. Free cash flow from operations was $338 million during the second quarter, demonstrating improved margins and lower sustaining capital investments.

Larry: Our operating cash flow amounted to 492 million and benefited from a release of working capital of $122 million during the quarter, which was expected to change in payment terms on some of the service contracts as we mentioned last quarter.

Larry: Our adjusted operating cash flow, which excludes movements in working capital amounted to $70 million as previously mentioned.

Larry: Free cash flow from operations was $338 million during the second quarter, demonstrating improved margins and lower sustaining capital investments.

Teitur Poulsen: For the first six months of the year, our producing assets have generated in excess of $400 million of free cash flow. Our adjusted earnings attributable to shareholders amounted to $122 million during the second quarter and represent a 170% increase on the same estimate for the first quarter of the year. Our balance sheet remains strong, with a net debt position at the end of the quarter of just below 900 million, excluding capital leases, resulting in a leverage ratio of 0.5 times based on the last 12 months' adjusted EBITDA.

Larry: For the first six months of the year, our producing assets have generated in excess of four 2 million of free cash flow.

Larry: Our adjusted earnings attributable to shareholders amounted $222 million during the second quarter and represents 170% increase on the same metric for the first quarter of the year.

Larry: Our balance sheet remains strong with net debt position at the end of departure of just below 900 million, excluding capital thesis, resulting in a leverage ratio of five times based on the last 12 months adjusted EBITDA.

Teitur Poulsen: Subsequent to the quarter, we drew down an additional $350 million to pay for the Cacerona 19% call option consideration. Our liquidity position remains strong, with our revolving credit facility having availability of close to $ 1.5 billion as of the end of the second quarter. So all in all, the company remains in good financial health with cost levels and sustaining capital investment levels both trending favorably, and coupled with robust commodity prices, this has resulted in a strong financial performance for the quarter. I'll now turn the call back to Jack to talk about our near-term growth opportunities and exploration.

Larry: Subsequent to the quarter, we drew down an additional 250 million to pay for tickets rollout.

Larry: 19% call option consideration.

Larry: Our liquidity position remains strong with our revolving credit facility, having availability of close to one 5 billion as of the end of the second quarter.

Larry: So all in all the company remains in good financial health with cost levels as sustaining capital and investment levels, both trending favorably and coupled with robust commodity prices has resulted in a strong financial performance for the quarter.

Larry: I'll now turn the call back to John to talk about our near term growth opportunities and exploration.

John: Thank you Tiger.

Jack Lundin: At the end of the quarter, we exercised our option to increase our ownership at Casaronis by an additional 19%, which will add approximately 25,000 tons of attributable copper to the company's production profile, securing additional copper production at an attractive acquisition price of approximately $14,000 per tonne. The call option exercise was paid for in cash and consisted of a payment of $350 million that was initially funded from Lundin Mining's revolving credit facility with the intention to refinance this amount by increasing the current $800 million term loan to $1.15 billion. Exercising our option early provides significant benefits to both parties.

John: At the end of the quarter, we exercised our option to increase our ownership at <unk> by an additional 19%.

John: Which will add approximately 25000 tons of attributable copper to the company's production profile securing additional copper production at an attractive acquisition price of approximately $14000 per ton.

John: A call option exercise was paid for in cash and consisted of a payment of $350 million that was initially funded from lundin mining's revolving credit facility with the intention to refinance this amount by increasing the current 800 million term loan to 1.15 billion.

John: Exercising our option early provides significant benefits to both parties, we secure additional copper production that at an attractive acquisition price well I partners receive an upfront payment and retained a meaningful 30% equity position in Castorama. This strategic move underscores our commitment to disciplined and scalable copper growth.

Jack Lundin: We secure additional copper production at an attractive acquisition price while our partners receive an upfront payment and retain a meaningful 30% equity position in Casa Rona. This strategic move underscores our commitment to disciplined and scalable copper growth. Now, touching on exploration.

John: Now touching on exploration.

Jack Lundin: At Candelaria, exploration efforts continue with over 8,300 meters of drilling now completed, and that's 8,300 meters of an overall 18,000 meter program. Much of this work is focusing on growing and upgrading the Candelaria underground resources where we have demonstrated success in the past. In addition, some efforts are directed at extending the La Espaola deposit.

Speaker Change: I can't malaria exploration efforts continue with over 8300 meters of drilling now completed.

Larry: <unk>.

Larry: Thats been Thats 8300 meters of the overall 18000 meter program.

Larry: Much of this work is focusing on growing the <unk> and upgrading the candle area underground resources, where we have demonstrated success in the past. In addition, some efforts are directed at extending the land spend Yolanda deposit.

Jack Lundin: Drilling activity at Casaronis continues and is on track to complete a 13,000-meter drill program, the most significant that that asset has had in years. However, at the moment, drilling is paused for the winter season. At Chapada, drilling is primarily focused on near mine opportunities and at the Sava Discovery. Further drilling at Sava kicked off in the second quarter. The plan includes drilling 16,000 meters this year. Initial results show Sauva mineralization continuing at depths with grades that would permit underground mining.

Larry: Drilling activity at <unk> continues and is on track to complete 13000 meter drill program.

Speaker Change: Most significant that that asset has had in years.

Speaker Change: At the moment drilling has paused for the winter season.

Speaker Change: That's your pad drilling is primarily focused on near mine opportunities and at least over discovery further drilling it so that kicked off in the second quarter.

Speaker Change: Plan includes drilling 16000 meters this year.

Larry: Initial results show so the mineralization continuing at depth with grades that would permit underground mining.

Jack Lundin: The system is still open at depth, and we will continue to explore in this area. Exploration efforts continue at Zinkruven, with over 23,600 meters of drilling now completed as part of the overall 55,000 meter drilling program.

Larry: The system is still open at depth and we will continue to explore in this area.

Larry: Exploration efforts continue with zinc Rubin with over 23600 meters of drilling now completed as part of the overall 55000 meter drilling program.

Jack Lundin: The primary focus remains on increasing mineralized resources or mineral resources at the Borte Barcombe and Dalby ore bodies to the west and the Berkeland and Negruvan ore bodies to the east. Financially, we had a strong quarter, driven by higher commodity prices that led to record quarterly revenue for the company and operating free cash flow of $338 million. Our team continues to focus on business improvements and optimizing our assets to deliver results. As mentioned earlier, our production is back half of the year weighted.

Larry: Primary focus remains on increasing mineralized resource our mineral resources at the border by Com and all of the ore bodies to the west and the Burkland and <expletive> Rubin ore body to the east.

Speaker Change: Financially, we had a strong quarter driven by higher commodity prices that led to record quarterly revenue for the company and operating free cash flow of $338 million. Our team continues to focus on business improvements and optimizing our assets to deliver results as mentioned earlier, our production is back half of the year weighted.

Jack Lundin: On a consolidated basis, we are tracking to fully your guidance on copper, zinc, and gold. There are a number of catalysts on the horizon that will help drive shareholder value, including the optimization work we are conducting at Candelaria and Casaronis. This includes looking at the underground expansion project at Candelaria, where we hope to give a market update on these initiatives by the end of the year. It is a very exciting time for the company, as announced on Monday, the joint acquisition of Phila with BHP and the subsequent formation of a joint venture that will hold the Phila Del Sol project and the Jose Maria project, which represents a compelling opportunity for Lundin Mining shareholders.

Speaker Change: On a consolidated basis, we are tracking to full year guidance on copper zinc and gold.

Speaker Change: There are a number of catalysts on the horizon that will help drive shareholder value, including the optimization work, we are conducting a candle area and costs around us. This includes looking at the underground expansion project at Kendall area, where we hope to give the market updates on these initiatives by the end of the year.

Speaker Change: It is a very exciting time for the company as announced on Monday, The joint acquisition of CLO with BHP and the subsequent formation of a joint venture that will hold the FILO del Solar project and the Jose Maria project, which represents a compelling opportunity for lundin mining shareholders.

Jack Lundin: This will be a transformational transaction for Lundin Mining. The creation of a long-term partnership between both Lundin Mining and BHP to jointly develop the Vicua District in Argentina will unlock significant value and is consistent with our strategy of becoming a top-tier copper producer. To close out our call, the team at Lundin Mining has worked hard in the first half of the year, putting us in a position to have a strong third and fourth quarter, and we will maintain our focus as we enter the second half of this year. I would now like to open the call to questions. Thank you.

Larry: This will be a transformational transaction for lundin mining the creation of a long term partnership between both lundin mining and BHP to jointly develop the peculiar district in Argentina will unlock significant value and is consistent with our strategy of becoming a top tier copper producer.

Speaker Change: To close out our call the team at <unk> has worked hard in the first half of the year, putting us in a position to have a strong third and fourth quarter and we will maintain our focus as we enter the second half of this year.

Speaker Change: Now like to open the call for questions. Thank you.

Operator: Thank you, ladies and gentlemen. We will now begin with the question and answer session. Should you have a question, please press the star followed by the one on your touchtone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press the star followed by the two. If you are using a speakerphone, please lift the handset before pressing any keys.

Speaker Change: Thank you ladies and gentlemen, we will now begin with the question and answer session should you have a question. Please press the star followed by the one on your Touchtone phone, you'll hear a prompt that youre.

Speaker Change: <unk> has been raised should you wish to decline from the polling process. Please press the star followed by the two.

Speaker Change: We are using a speaker phone please lift the handset before pressing any keys one moment for your first question.

Operator: One moment for your first question. Our first question comes from Ioannis Masvoulas from Morgan Stanley. Please go ahead.

Speaker Change: Our first question comes from IONICS mass bolus from Morgan Stanley. Please go ahead.

Ioannis Masvoulas: Yes, good morning, Jack and Tim. Thank you very much for the presentation. My first question is on Candelaria and the QGIP expansion option. Can you give us an update on the timing of a decision and possible CAPEX implications? And how does it actually fit into your growth aspirations in light of the JV with BHP? Thank you.

Jack Lundin: Yes, good morning, Jack and team. Thank you very much for the presentation.

Speaker Change: First question is on Candelaria, and acute chip expansion option can you give us an update on our <unk>.

Jack: The timing of a decision and possible capex implications and how does it actually fit into your growth aspirations in light of the JV with BHP. Thank you.

Speaker Change: Yeah.

Jack Lundin: Hi Ioannis. Thanks for the question. The Candelaria underground expansion project is currently undergoing design and capital optimization efforts by the team there, and this is something that we're definitely keen to pursue, as mentioned in previous quarters and in the presentation today. We're assessing kind of an optimized plan and anticipate we'll be in a position to update the market towards the end of this year. But I would say that, you know, it continues to be, you know, in terms of capital allocation, something that we would like to prioritize and is showing, you know, promising early stage results from where we're at in the study.

Speaker Change: Hi, Thanks.

Speaker Change: Thanks for the question the candle area underground expansion project is currently undergoing a design and capital optimization efforts by the team there and you know this is something that we are definitely keen to pursue as mentioned in previous quarters and on the presentation today.

Speaker Change: We're assessing kind of an optimized plan and anticipate we'll be in a position to update the market towards the end of this year, but I would say that it continues to be.

Speaker Change: In terms of capital allocation, something that we would like to prioritize and showing.

Speaker Change: Promising early stage results from where we're at in the study.

Operator: Our next question comes from Martin Pradier from Veritas Investment Research. Please go ahead. Thank you.

Speaker Change: Our next question comes from Martin Pradier from Pruritus investment Research. Please go ahead.

Martin Pradier: Thank you. I just have a question on the... On the Jose Maria, you booked $50 million in earnings in our reduced taxes out of the 122 million reported. Could you provide more color on the Jose Maria income?

Martin Pradier: Thank you I just have a question on on the.

Martin Pradier: On the whole somebody.

Speaker Change: You booked $50 million in earnings and a reduced taxes.

Speaker Change: Out of the 122 million reported.

Speaker Change: Could you provide more color on Oh somebody yeah.

Speaker Change: Income.

Teitur Poulsen: Hi Martin. Good morning. It's Teitur here.

Speaker Change: Yeah, Hi, Martin Good morning, it's tighter here, yes. This this relates to.

Teitur Poulsen: The reversal of a tax expense that we incurred in the fourth quarter when the Argentinian currency was devalued significantly.

Teitur Poulsen: This relates to a reverse of a tax expense that we incurred in the fourth quarter when the Argentinian currency was devalued significantly. Our tax balances in Argentina are booked in local currencies. So when the currency devalues, obviously, the recovery of that in dollar terms is reduced significantly. But there are inflation adjustments on the tax balances we have in Argentina. And this is essentially reversing the charge we had in Q4 with inflation adjusting to tax, the local currency tax balances we have in Argentina, which essentially has reversed that $50 million dollar tax charge you had in Q4 and now we're reversing that, back to zero effectively in the second quarter this year, so reflecting a tax receipt of, A non-cash tax receipt of $50 million in the second quarter. Our next question comes Please go ahead. Thanks very much, guys.

Speaker Change: Our tax balances in Argentina are are booked in local currencies.

Speaker Change: So when the currency devalued, obviously, it's a recovery of stocks in dollar terms.

Speaker Change: Reduced significantly.

Speaker Change: But there is inflation adjustments on the.

Speaker Change: The tax balances we have in Argentina.

Speaker Change: And this is essentially reversing the charge we had in Q4 with no inflation adjusting to tax the local currency tax balances you have in Argentina, which which essentially this is reversed out $50 million.

Speaker Change: Solar tax charge, you had in Q4, and there will be a reversion back to.

Speaker Change: Back to zero effectively in the second quarter of this year, so reflecting a tax receipts of cash tax receipt of $50 million in the second quarter.

Operator: Our next question comes from Stefan Ioannou from Cormark Securities in the Philippines. Please go ahead.

Speaker Change: Our next question comes from Stefan <unk> from core Mark Securities in the Philippines. Please go ahead.

Stefan: Okay. Thanks, very much guys. Just a quick maybe housekeeping question just looking to Cassa <unk>.

Speaker Change: And he reiterated cash cost guide can you just remind us because I remember there was there was talk of some of some labor negotiations through the summer with with with various parties can you just remind us where we're at with that and how that maybe is reflected in your cost guidance.

Speaker Change: Okay.

Stefan Ioannou: Yeah, sure. And I'll hand it over to Juan Andres to give an update on that, the status.

Speaker Change: Yeah, sure and I'll hand, it over to Juan Andres to give an update on the status.

Juan Andres Morel: Good morning, Stefan. This is Juan Andres.

Speaker Change: Yes, good morning, Stefan this is Juan Andres.

Juan Andres Morel: We have three union seen in cost of doing this we have already closed the first negotiation in Q1 and as we speak we're in the final stage of the second negotiation with the second Union.

Juan Andres Morel: We have three unions in Cacerones. We closed the first negotiation in Q1. And, as we speak, we're in the final stage of the second negotiation with the second union. We expect to close that in the next couple of weeks.

Juan Andres Morel: We expect to close that in the next couple of weeks.

Juan Andres Morel: and I can maybe add that in our guidance, we have made an allowance and an assumption on what these outcomes are going to... yield. So it should already be embedded in the guidance we have given.

Speaker Change: And I can maybe up like the in our guidance, we have made on the allowance and an assumption on.

Speaker Change: On on what.

Juan Andres Morel: These outcomes are going to.

Juan Andres Morel: Yields so.

Juan Andres Morel: You should you should already be embedded in the guidance we have given.

Juan Andres Morel: Yeah.

Operator: Our next question comes from Edward Goldsmith from Dutch Bank. Please go ahead.

Juan Andres Morel: Our next question comes from Edward Goldsmith from Dutch Bank. Please go ahead.

Edward Goldsmith: Hi Jack and team. Thank you for the presentation. Two questions from our side. Firstly, on the optimization plan and the synergies between your Chilean assets, can you give us an idea of what has been achieved to date and the future synergy potential?

Edward Goldsmith: Hi, Jack and team. Thank you for the.

Edward Goldsmith: The presentation two questions my side, firstly on the optimization plan and the synergies between your <unk> assets can you give us an idea of what has been achieved to date and the future potential.

Jack Lundin: Yeah, sure. Juan Andres, maybe you can comment on the full potential work that we've got ongoing at Candelaria and Casaronis.

Juan Andres Morel: Yes, sure Juan Andres, maybe you can comment on the full potential work that we've got ongoing candle area in cancer owners.

Juan Andres Morel: Yes, as Jack mentioned during the presentation, we have started what we call the Full Potential Initiative in actually three of our sites. We started with Chapada in 2023, and later in the year, we started the same exercise in Cacerones and Candelaria. We have seen very good results, and some of the reductions in the C1 that you're seeing are somehow attributed to that work that is being done. We plan to update the market on a broader view by the end of the year, but so far, we're moving forward with the implementation of several initiatives.

Juan Andres Morel: Yeah, SaaS as Jack mentioned during the presentation, we have started.

Juan Andres Morel: What we call their full potential initiative and actually three of our sites. We started with <unk> in 2023 and later in the year. We started the same exercise in costs at <unk> and Candelaria, we have seen very good results and are some of the the reductions in the C. One that youre seeing.

Juan Andres Morel: Our somehow attributed to that work that is being done we plan to update the market on a more a more broader.

Juan Andres Morel: View by the end of the year, but so far we're moving forward with the implementation of several initiatives and regarding your question on synergies between Candelaria and <unk>, we have already established what we call. The regional support function units basically assured services unit and.

Juan Andres Morel: And regarding your question on synergies between Candelaria and Cacerones, we have already established what we call the Regional Support Function Unit, basically a shared services unit, and that unit is already working on joint bidding processes, and we have seen very good results from those processes already.

Juan Andres Morel: That unit is already working on joint bidding processes, and we have seen very good results from those processes already.

Juan Andres Morel: Okay.

Operator: The next question comes from Daniel Major from UBS. Please go ahead.

Juan Andres Morel: Next question comes from Daniel Major from UBS. Please go ahead.

Daniel Edward Major: Hi, there can you hear me okay.

Speaker Change: Yes, yes.

Daniel Edward Major: Great, thanks. Yeah, a couple of questions and apologies if anything's already been answered. I was a bit late joining.

Speaker Change: Thanks.

Daniel Edward Major: Couple of questions and apologies if anything has already been.

Daniel Edward Major: It's a bit late joining.

Jack Lundin: Our first question is on the CapEx outlook, specifically with respect to Argentina, your guidance of $225 million for this year. Can you give us any steer on how you would expect that number, on an attributable basis, to trend for Lundin in 2025, post the formation of the JV on the basis of 2025? and the next one is going to be formulating studies. Can you give us any idea where that number will likely land next year?

Speaker Change: Our first question is on the Capex outlook.

Speaker Change: Outlook.

Speaker Change: Specifically with respect to Argentina, your guidance to $25 million for this year can.

Speaker Change: Can you give us any stab on how you would expect that number on an attributable basis to trend for Lindeen in 2025 post the formation of the JV on a basis 2020, fives essentially going to be sort of formulating studies et cetera.

Speaker Change: Yes can you give us any steer on where that number would likely land next year.

Speaker Change: Okay.

Jack Lundin: At the moment, you know, we're working on completing the program that we set out in 2024. So the Jose Maria project team still has a number of initiatives that they need to work through as we look to close the deal and form the joint venture. And as mentioned on the call yesterday, we're going to be focusing on kind of releasing an updated budget, you know, for the year towards the end of this year.

Speaker Change: At the moment you know were working on completing the program that we set out in 2024. So the Jose Maria project team still has a number of initiatives that they need to work through as we look to close the deal and formed a joint venture and as mentioned on the call yesterday, we're going to be focusing on kind of releasing an updated budgets.

Jack Lundin: For the year towards the end of this year, but the first half of 2025 will be able to provide a lot more clarity on work planned studies and kind of the path forward. Once both assets are held together in the joint venture, but theres still a lot of work to be done on Jose Maria we continue to work through various items.

Jack Lundin: But in the first half of 2025, we'll be able to provide a lot more clarity on work plan studies and kind of the path forward once, you know, both assets are held together in the joint venture. But there's still a lot of work to be done on Jose Maria. We continue to work through various items, you know, de-risking, looking at trade-off studies at the asset as a standalone, and then also looking at, you know, hydrogeology models and, you know, water field programs as well. So we'll continue on that, and we'll update the market closer towards the end of this year.

Speaker Change: Derisking looking at tradeoff studies at the asset as a Standalone and then also looking at.

Speaker Change: Hydro geology models and.

Jack Lundin: Waterfield programs as well so we'll continue on that and we'll update the market closer towards the end of this year.

Operator: Our next question comes from Ioannis Masvoulas of Morgan Stanley. Please go ahead.

Speaker Change: Our next question comes from my honest months' bolus from Morgan Stanley. Please go ahead.

Ioannis Masvoulas: Yes, just to follow up on the JV structure announced yesterday. In the past, you had indicated that a partnership at Josemara level could involve a mining company and potentially another partner such as Melting Group. Is there a possibility for this to now materialize at the new JV that you have set up with BHP? Or is that not really something you're contemplating?

Orest Wowkodaw: Yes, hi, so just a follow up on <unk>.

Speaker Change: The JV.

Speaker Change: Structured announced yesterday.

Speaker Change: First you had indicated as a partnership.

Speaker Change: Jose Maria level could involve a mining company and potentially another partner such as smelting groups is there a possibility for this do not materialize or the new JV that you have set up with BHP or is that not really something you're contemplating.

Jack Lundin: Hey, Ioannis, thanks for the question. You know, at the moment, right now, we're really focused on forming this JV and having a 50-50 JV structure. In the future, at a later date, should the partners decide that they'd like to bring in a third partner, we, you know, can do so at that time. I think, at the moment, right now, we're contemplating working just with BHP and Lundin Mining on driving these projects forward, but we do keep the optionality open for the future. But right now, a lot of work needs to be done to, you know, formulate the JV as described in the transaction announcement on Monday.

Speaker Change: Hey, Thanks for the question at the moment right now, we're really focused on forming this JV and having a 50 50 JV structure.

Speaker Change: In the future at a later date should the partners decided that we'd like to bring in a third partner we can.

Jack Lundin: Can do so at that time I think at the moment right now we're contemplating working just BHP in lundin mining on driving these projects forward, but we do keep the optionality open floor for the future, but right now a lot of work needs to be done to two.

Speaker Change: Formulate the JV as the.

Speaker Change: Described in the transaction announcement on Monday.

Speaker Change: Okay.

Operator: The next question comes from Orest Wowkodaw from Scotiabank. Please go ahead. Hi, good morning.

Speaker Change: Next question comes from Aurist, while Codell from Scotiabank. Please go ahead.

Orest Wowkodaw: Hi, good morning. Another question about the announcement made on Monday evening with respect to the JV with BHP. I'm just wondering, obviously, we have not seen any kind of updated technical report on Jose Maria, so I'm trying to understand what the value is, the $690 million that BHP is paying for the 50% stake effectively in Jose Maria. Does that reflect, like, can we read into that in terms of an implied NAV value for what Jose Maria is actually worth from an NPV perspective? And I'm just wondering also, like, at what copper price does that assume?

Orest Wowkodaw: Hi, Good morning, another question about the announcement from Monday evening with respect to the JV with BHP I'm. Just wondering obviously, we have not seen any kind of updated technical report on Jose Maria So I'm trying to understand what the value. They are $690 million at BHP is paying for.

Orest Wowkodaw: 50% stake effectively and Jose Maria does that reflect like can we read into that in terms of an implied NAV value for what what Jose Maria is is actually worth from an NPV perspective, and I'm. Just wondering also like at what copper price does that assume.

Jack Lundin: Yeah, hi, Orest. The 690 million consideration for Jose Maria is BHP's valuation of what they anticipate, you know, and what they think bringing both assets together will cost and us investing in Jose Maria to, you know, to really form this joint venture that contains both the Jose Maria project and Filo del Sol. That was the valuation that we were able to negotiate. So, you know, they have their internal models; we have our internal models on what we believe the value is of Jose Maria, but now we get to look at both assets coming together and really scaling up this development plan. So, you know, that's all I can comment on their valuation for now.

Orris: Yes, Hi, Orris.

Speaker Change: And on.

Jack Lundin: The 690 million consideration for Jose Maria is Bhp's valuation on what they anticipate and what they think bringing both assets together will cost us bending and Jose Maria too.

Speaker Change: Do you really formed this joint venture that contains both the Jose Maria project in Philadelphia.

Jack Lundin: That was the valuation that we were able to negotiate so.

Jack Lundin: They have their internal models, we have our internal models on what we believe the value is of Jose Maria but now we get to look at both assets coming together and really scaling up this development plan. So.

Jack Lundin: That's all I can comment on their valuation for now.

Operator: The next question comes from Edward Goldsmith from Deutsche Bank. Please go ahead.

Speaker Change: Next question comes from Edward Goldsmith from Deutsche Bank. Please go ahead.

Edward Goldsmith: Hi, just going back to the Jose Maria transaction, can you talk us through the potential adjustments to the 690 million payments from BHP?

Edward Goldsmith: Hi, just going back to the Jose Maria transaction can you talk us through the potential adjustments.

Speaker Change: So there's not 1 million payment from BHP.

Edward Goldsmith: Well.

Jack Lundin: We have agreed with BHP that we are funding the work program on Jos Maria for the remainder of this year and, you know, depending on what actual expenditure is incurred at the end of the year. There might be an upward or downward adjustment on the $690 million payment. And from 2025 onward, we are paying 50-50 on capital expenditure. And again, if the deal hasn't closed by the year end, then there will be a further adjustment on 2025 expenditure after when the deal closes in 2025 to reflect the 50-50 funding structure on the 1st of January.

Speaker Change: We are we have agreed with BHP.

Jack Lundin: We are funding.

Speaker Change: The work program on host Maria for the remainder of <unk>.

Jack Lundin: This year.

Speaker Change:

Jack Lundin: And depending on what.

Speaker Change: <unk> actual expenditure is incurred to the end of the year.

Jack Lundin: There might be an upward or downward adjustment on the $619 million payment and from 'twenty to 'twenty five onward.

Speaker Change: We are paying $50 51.

Jack Lundin: Capital expenditure.

Jack Lundin: And again, if the deal hasn't closed by year.

Jack Lundin: At year end.

Jack Lundin: Then there will be a further adjustment on 2025 expenditure as and when the deal closes in 2025 to reflect the 50 50 funding structure first of January.

Jack Lundin: Yeah.

Operator: The next question comes from Ioannis Masvoulas from Morgan Stanley. Please go ahead.

Speaker Change: Next question comes from IONICS mass bolus from Morgan Stanley. Please go ahead.

Ioannis Masvoulas: Hi there, sorry, just one last question from my side, just on Eagle. So you flag the challenges in the second quarter, and you have already revised guidance lower for the rest of this year. Assuming the ramp rehabilitation completes by the end of 24, do you see the 2025-26 production guidance at Eagle as achievable? Or are there downside risks given where you are with this asset today?

Speaker Change: Hi, there I'm sorry, just.

Speaker Change: One last question from my side just on Eagle.

Ioannis Masvoulas: So you flagged the challenges in the second quarter and you have already revised guidance lower for the rest of this year, assuming the ramp reputation completes by the end of 'twenty four.

Nathan Monash: Do you see the 'twenty to 'twenty five 'twenty six production guidance that the Eagle is achievable.

Ioannis Masvoulas: Or are there downsides risks given given where you are with your sources there today.

Jack Lundin: Yeah, I'll let Juan Andres answer that. But I think, you know, we're trending towards being able to recoup those lost tonnages through the, you know, through the fall of ground. So we anticipate we'll be able to get back ramped up. But Juan Andres, you can you can comment better than I can as you were just at the site. Sure, thank you, Jack.

Speaker Change: Yes, I'll, let Andre answer that but I think.

Andre: We're trending towards being able to recoup those lost tonnages through the through.

Jack Lundin: Through the fall of ground. So we anticipate we'll be able to get get back ramped up but one Andreas you can you can comment better than I can as you were just that site.

Juan Andres Morel: Sure, thank you, Jack. Ioannis, we plan to finish the rehab work by the end of Q3, beginning of Q4, so we expect to get back to full-scale production by the end of the year. So at this point, we have only adjusted the guidance for 2024, and we don't see an impact on 2025 yet.

Juan Andres Morel: Sure. Thank you attack I only saw the we plan to finish the rehab work.

Juan Andres Morel: By the end of Q3, beginning of Q4, so we expect to get back to full scale production by the end of the year. So at this point, we have only adjusted the guidance for 2024, and we don't see an impact on 2025 yet.

Juan Andres Morel: Okay.

Operator: The next question comes from Orest Wowkodaw from Scotiabank. Please go ahead.

Speaker Change: Next question comes from Orange to Wild Codell from Scotiabank. Please go ahead.

Orest Wowkodaw: Hi, Jack, just to clarify, sorry, your last comments about my first question, just that Does the 690 paid by BHP assume a value solely for Jose Maria? Or does that also include, call it, some value for putting filo de sol together with the acid? I'm just trying to understand sort of what the valuation of Jose Maria could be.

Orest Wowkodaw: Hi, Jack just to clarify sorry, your last comments about my first question.

Orest Wowkodaw: It.

Orest Wowkodaw: Does the 690 paid by BHP does that assume a value solely for Jose Maria or does that also include call. It some value of putting philo default together with the outset I'm just trying to understand sort of what the valuation of Jose Maria it could be.

Jack Lundin: Yeah, Orest, that's their consideration for 50% of Jose Maria. So their consideration for us, you know, for them taking over 50% of Jose Maria as we've ended up in the joint venture.

Speaker Change: Yeah, where is that.

Speaker Change: Their consideration for 50% of Jose Maria so their consideration for us for them, taking over 50% of Jose Maria as we've entered into the joint venture.

Operator: The next question comes from Martin Pradier from Burritis Investment Research. Please go ahead. Yes, thank you.

Speaker Change: Next question comes from Martin Pradier from Burritos investment Research. Please go ahead.

Martin Pradier: Yes, thank you. I just want to understand that the key parts for the Jose Maria mill have been ordered. So I'm assuming that the size of the mill is set. If that is correct, how fast could the mill be in production?

Martin Pradier: Yes. Thank you.

Speaker Change: Just wanted to understand.

Speaker Change: That because somebody had meal key parts have been ordered.

Speaker Change: So I'm assuming that the size of the mill is set.

Speaker Change: If that is correct.

Speaker Change: How fast would that be in production.

Speaker Change: Hello.

Martin Pradier: Yeah.

Jack Lundin: Hi, thank you for your question. So yeah, that is correct. We do have some long-lead items and some large-scale fixed equipment like the ball and sag mills and the mill motors for Jose Maria that have already been purchased and are now in store storage in San Juan. You know, these are large-scale mills. And so, therefore, we do anticipate that when the time is right to go into development, we'll be able to utilize this equipment.

Speaker Change: Alright. Thank you for your question. So yes that is correct. We do have some long lead items and some some large scale fixed equipment like.

Jack Lundin: The ball and Sag Mills, and the mill Motor Sport Jose Maria that has already been purchased and is now in store storage in San Juan.

Jack Lundin: These are large scale mills and so therefore, we do anticipate that when the time is right to go into development, we'll be able to utilize this equipment.

Jack Lundin: But again, we still have a lot of development avenues and opportunities to look through. And so once we've done our studies and done our integration of both assets, then we'll be able to better define the execution strategy for phase one of this district development.

Jack Lundin: But again, we still have a lot of development avenues and.

Jack Lundin: And opportunities to look through and so once we've done our studies and done our integration of both assets then we will be able to.

Jack Lundin: To better define the execution strategy for phase one of this district development.

Jack Lundin: Okay.

Speaker Change: Okay. Thanks.

Jack Lundin: There are no further questions at this time. I'd now like to turn the call back over to Jack for his final closing comments. Please go ahead.

Jack Lundin: There are no further questions at this time I would now like to turn the call back over to Jack for final closing comments. Please go ahead.

Jack Lundin: Thank you everyone for joining the call. We appreciate that it's been a busy week for Lundin Mining but a very exciting one nonetheless, and we remain on track to meet our guidance, and we'll be focusing on continuing our operational performance throughout the end of this year and, in parallel, looking at closing this exciting transaction that we've announced. So, I appreciate the support and thank you for all the questions.

Jack Lundin: Thank you everyone for joining the call and we appreciate that it's been a busy week for lundin mining, but a very exciting one nonetheless, and we remain on track to meet our guidance and we will be focusing on continuing our operational performance throughout the end of this year and in parallel looking at closing this exciting transaction that we've announced so I appreciate the support and.

Jack Lundin: Thank you for all the questions.

Operator: Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines. Thank you.

Speaker Change: Ladies and gentlemen, this concludes your conference call for today, we thank you for participating and ask that you. Please disconnect your lines. Thank you.

Operator: Yeah.

Operator: Okay.

Operator: Yeah.

Operator: Yeah.