Q3 2024 Vista Gold Corp Earnings Call
Speaker Change: Good day ladies and gentlemen, welcome to Mr. Gold's third quarter 2024, find out what we've got and corporate art date often to call. At this time, all participants are an English and only mode.
Speaker Change: and the following presentation, we'll conduct a question and answer session. At that time, participants are asked to press star 1 to register for a question. For assistance during the call, press star 0, when you're having a phone.
Speaker Change: and the commander, the conference hall is being recorded. Today is Thursday, October 24, 2024.
Speaker Change: is now my pleasure to introduce Pamela Solly, Vice President of the Investor Relations. Please go ahead.
Pamela Solly: Thank you Andrew and good day everyone.
Pamela Solly: Thank you for joining the Vista Gold Corp. 3rd quarter, 2024, financial results in corporate update conference call.
Pamela Solly: I'm Pamela Solly, Vice President of Investor Relations. On the call today, we have Fred Ernest, President and Chief Executive Officer and Doug Tobler, Chief Financial Officer.
Pamela Solly: At the close of business yesterday, the Sir reported its third quarter, 2024, operating in financial results. Copies of the news release and quarterly report on Form 102 are available on our website at www.distagold.com.
Pamela Solly: During the course of this call and the question and answer session, we will be making forward looking statements.
Pamela Solly: These statements involve known and unknown risks on certainties and other factors that may cause actual results performance or achievements of VISTA to be materially different from results performance or achievements expressed or implied by such statements.
Pamela Solly: Please refer to our most recently filed forum to the two for details of risks and other important factors that could cause actual results to differ materially.
Speaker Change: from those in our forward-looking statements and the cautionary note regarding estimates of mineral resources and mineral reserves. I will now turn the call over to Fred Ernest.
Fred Ernest: Thank you, Pam, and thank you everyone for joining us today.
Fred Ernest: Vista's Mount Todd Gold project is a large, high quality gold deposit and one of the most attractive mining jurisdictions in the world.
Fred Ernest: It is an especially attractive shovel-ready development opportunity and we're advancing Mount Todd in ways that efficiently position the project for development while exercising the discipline necessary to best realize value at the right time.
Fred Ernest: This is committed to seeing its development in keeping with the highest mining and ESG standards.
Fred Ernest: On the call today we will provide you with an overview of our current activities and other market factors that we believe will be drivers for greater shareholder values.
Fred Ernest: During the third quarter we continued to successfully execute our corporate strategy and made significant progress toward achieving our 2024 goals and objectives. We announced positive results from our ongoing drilling program.
Fred Ernest: Advanced Technical Studies and anticipation of a decision to command safety's ability study targeting 150 to 200,000 ounce of gold production per year.
Fred Ernest: Prior to the end of this year, and continued to prioritize low overall spending, and we ended the quarter with $19 million in cash. I'm pleased to report that we have had no last time, for the last time.
Fred Ernest: and the Mount Todd site now has reached 177 consecutive accident free days.
Speaker Change: I will discuss some of these topics and greater detail later in the call. But I will now turn the time over to Doug Tobler for a review of our financial results for the quarter-ended September 30th, 2024.
Doug Tobler: Thank you Fred.
Doug Tobler: Today I'll provide a brief recap of our results of operations for the quarter-ended September 30, 2024, and our financial position at this date.
Doug Tobler: Our full financial statements and our MDNA are included in our Form 10Q that was filed yesterday and is available at either SCC.gov or cdareplus.ca.
Doug Tobler: This to reported a consolidated net loss of $1.6 million for the quarter-ended September 30, 2024. This compared to a consolidated net loss of $1.5 million for the quarter-ended September 30, 2023.
Doug Tobler: The loss increased by a net of $100,000 for the current quarter and was in line with our expectations.
Doug Tobler: Mount Todd related to costs were up by about $250,000. Mostly because we expense several of the 2024 drill holes that did not qualify for capitalization.
Doug Tobler: and we experienced increased spending this quarter as we initiated several studies in an anticipation of moving forward with a feasibility study for an alternative scale development option.
Doug Tobler: These increases in mount-tud spending were partially offset by several other items that resulted in a net reduction of a loss by about $150,000.
Doug Tobler: for the 9 months in September 30, 2024 and 2023, we reported net income of 12 and a half, sorry, 12.9 million dollars, and a net loss of 4.9 million dollars respectively.
Doug Tobler: The net income for the 2024 period resulted from recognizing a gain on grant of royalty interest in mineral titles of $16.9 million and the gain on the sale of mill equipment of $800,000.
Doug Tobler: After you account for the effect of these two transactions, other expense and income items were generally consistent when considered on a net basis.
Speaker Change: Turning to our financial position, our balance sheet remained good in good condition at September 30 this year. We ended with cash of 19 million as Fred had said, and we also continued to have no debt.
Speaker Change: and that concludes my remarks for today. I'll turn the call back over to Fred. Thank you. Thank you, Doug.
Fred Ernest: I'll begin with our third quarter achievements and follow that by our outlook for the remainder of the year.
Fred Ernest: First of all, let me talk about the drilling program.
Fred Ernest: In January of this year, we started a 6 to 7,000-meter drilling program.
Fred Ernest: It was followed by their technical studies to evaluate an alternative scale development plan amount to HUD. The drilling program is during completion and we are pleased with the results today. Results from the now complete phase one drilling were announced in August.
Fred Ernest: and successfully confirmed the extension of the core zone and the mineralized boundaries in the northern section of the Batman deposit, including intercepts outside of the anticipated mineral boundaries at the northern limit, that included gold grains that exceeded our expectations.
Fred Ernest: and Rumpfays 2 drilling results for the South Crossload were announced in September. An identified multiple high-grade intercepts including...
Fred Ernest: 0.5 meters with 50 grams per ton and drill hole VB2414.
Fred Ernest: in a hole 2415 wind-countered one meter with 12.57 grams of gold per ton.
Fred Ernest: In hole 16, we drilled 2.3 meters with 7.93 grams of gold per ton.
Fred Ernest: and in the whole 22 we intersected one meter with 25.89 grams of gold per ton. For more detail on the results that were announced, please refer to our September 24th press release.
Fred Ernest: We now understand the South Crossload Zone to be a narrower mineralized structure compared to the Batman deposit and it's adjacent to the Batman deposit and it extends from about 400 meters to the northeast.
Fred Ernest: Our geologists are presently working to understand the open pit and underground mining potential of this zone, and develop a model for future exploration in this zone, along with other high-grade targets, northeast of the Batman deposit. The drilling program is expected to be completed by year end.
Fred Ernest: and now address the trade-off studies and other value creation opportunities.
Fred Ernest: As they indicated, we initiated studies and we continued to advance trade off studies.
Fred Ernest: and preliminary evaluations of an alternative scale development plan for Mount Todd.
Fred Ernest: We are focused on a development plan with daily throughput in the range of 12 to 17,000 tons per day, which equates to somewhere in the range of 4 to 6 million tons per year.
Fred Ernest: and we expect to have the trade-offs studies completed by mid-November.
Fred Ernest: Previous studies demonstrated the opportunities to significantly lower the initial capex, maintain high margins and deliver attractive economics at this scale, while preserving the flexibility for future expansion.
Fred Ernest: With the gold price now, more than $2,700 per ounce, and continuing to rise.
Fred Ernest: Margines are increasing our analysis suggests that higher margins combined with lower initial capital provide an avenue for greater value recognition.
Fred Ernest: We believe that an alternative development strategy offers valuable optionalities. We focus on creating sharedholder value and attracting investor interest in Mount Todd.
Fred Ernest: For the more, we believe there are other market factors that could have a significant positive impact on our future share price. First,
Fred Ernest: Research recently published by S&P Global Market Intelligence indicates that major gold deposit discoveries and they define major gold deposits is greater than 2 million ounces.
Fred Ernest: have significantly declined over the last 35 years. The data indicates that, in the period from 1990 to 1999, there were 183 major going to deposit discoveries.
Fred Ernest: in the period 2000 to 2009 that dropped to 120 discoveries. From 2010 to 2019, 42 discoveries.
Fred Ernest: and from 2020 through the present there have been five major goal deposit discoveries.
Fred Ernest: We believe that the scarcity of major gold deposit discoveries will result in producers placing greater focus on optimizing existing projects.
Fred Ernest: and acquiring advanced-stage development projects. Advanced-stage, shoulder-ready projects like Monttad, will benefit as producers seek demonstrated feasibility, lower risk, and a faster path to production.
Fred Ernest: Second, over the last two years, the Gold Price is increased by 50%. On average, senior Gold producers are up much more than that.
Fred Ernest: But developers are lagging the gold price and are on average even or only slightly up over the same period.
Fred Ernest: Well, this has outperform most of its peers during this period. We believe that the current strong and rising gold price will help drive a revaluation of developers with significant benefit for VISTA shareholders.
Fred Ernest: Last.
Fred Ernest: Mount Todd demonstrates robust project economics.
Fred Ernest: Our 2024 Mount Todd feasibility study update reported a net present value at a 5% discount rate.
Fred Ernest: of $1.1 billion at an $1,800 gold price in 69 cents for an exchange rate.
Fred Ernest: using the feasibility study cash flow model and updating the prices.
Fred Ernest: At a $2,600 gold price, the NPV5 is estimated to be $3.1 billion at a $6,880 cent for an exchange rate.
Fred Ernest: and at $3,000 gold price, the NPV-5 is $4 billion.
Fred Ernest: We expect continued strength in the gold market.
Fred Ernest: and expect that this will result in greater recognition of the intrinsic value of the Mount Todd Project over time.
Fred Ernest: Now let me turn to the recent S3 shell for registration statement.
Fred Ernest: Last week, the company filed a $50 million shelf registration statement on Form S3 with the US, Curies and Exchange Commission. The shelf registration statement will replace the previous $100 million shelf registration statement filed on November 19th.
Fred Ernest: 2021 that will expire on December 3rd of this year.
Fred Ernest: We are under no obligation to use the shelf registration and a filed-this registration in the normal course of business consistent with our practice of maintaining a current shelf registration.
Fred Ernest: of note over the life of the previous shelf registration statement.
Fred Ernest: We are opportunistically sold shares with a value of approximately $2 million under our ATM agreement.
Fred Ernest: As we look ahead.
Fred Ernest: Our priorities are to maintain a strong balance sheet.
Fred Ernest: Complete the Phase 2 of our Drilling Program, Commence of Feasibility Study, for an alternate scale development option at Mount Todd and continue our work to maximize our holder value.
Fred Ernest: and I'll tell you a little bit about the line we talked about.
Fred Ernest: The feasibility study in the work that we're doing to lower the capax for a development of option of mount Todd.
Fred Ernest: We anticipate moving forward with a feasibility study targeting throughput in the range of 12 to 17,000 tons per day or 4 to 6 million tons per atom.
Fred Ernest: with 150 to 200,000 ounces of annual gold production and initial capital cost of less than $400 million US.
Fred Ernest: and a reserve grade of approximately 1 gram per ton.
Fred Ernest: This is our target for this feasibility study.
Fred Ernest: By using contract mining, third-party power generation and construction practices.
Fred Ernest: Commonly used in Australia, we believe there is an opportunity to maintain high capital efficiency at this project scale.
Fred Ernest: The Feasibility Study will leverage prior technical studies and the work completed for the 50,000 ton per day Feasibility Study. It will preserve the potential for future expansion and demonstrate the opportunity for Mount Todd to deliver substantial economic returns.
Fred Ernest: in a range of development scenarios.
Fred Ernest: So the decision to initiate the feasibility study is expected prior to the end of the year.
Fred Ernest: and the
Fred Ernest: in conclusion.
Fred Ernest: This is the whole of the Mount Todd Gold project, a show ready development stage Gold project located in the northern territory of Australia.
Fred Ernest: One of the most attractive jurisdictions in the world, Mount Todd offers significant scale, development optionality, growth opportunities, advanced local infrastructure, community support, and then-straighted economic feasibility.
Fred Ernest: We are positioning Mount Todd as a leading development opportunity within the Golds sector.
Fred Ernest: We expect continued strength in the Gold Price and believe that shovel ready projects like Mount Todd
Fred Ernest: or especially attractive development opportunities in the current environment of this strong gold market.
Fred Ernest: Deminishing Major Project or Major Discavaries
Fred Ernest: and depleting gold reserves.
Fred Ernest: We expect our strategy of advancing Mount Todd with discipline to deliver a more fully valued project to our shareholders.
Fred Ernest: We believe that thoughtful evaluations and a focus on minimizing shirt holder risk will help us create and realize greater value for our stakeholders.
Fred Ernest: Business committed to seeing the development of Mount Todd and keeping with the highest mining and ESG standards and will work diligently toward that goal. It is important to note that we hold approvals for all major permits needed to initiate development.
Fred Ernest: The Mount Todd Gold project is one of the largest and most advanced and available projects in Australia with 7 million ounces of proven and probable reserves. In addition to its size, Mount Todd offers a number of other strategic advantages.
Fred Ernest: Mount Todd is ideally located in the northern territory of Australia, an extremely stable and mining friendly jurisdiction.
Fred Ernest: The existing project infrastructure, Mount Todd provides construction timeline and risk mitigation advantages. As I've indicated, all of the major permits to initiate development of Mount Todd have been approved.
Fred Ernest: of Equal Importance, we have earned the trust of the local stakeholders and our confident that our social license is firmly in hand.
Fred Ernest: Our current technical programs aimed to de-risk the project by incorporating designs that significantly reduce the initial capital costs while maintaining competitive operating costs and preserving the option for future project expansion.
Fred Ernest: For more comprehensive review of the work completed by Vest on the Mount Todd Project, I refer you to our corporate presentation, which can be found on our website at www.vistchool.com
Fred Ernest: We believe that this field represents an exceptional investment opportunity in that current crisis, represent tremendous opportunity to establish a position, or an increased one's holdings in this to go.
Speaker Change: This concludes our formal remarks, Andrew will now respond to any questions from the participants on this call.
Andrew: Thank you. Ladies and gentlemen, well now we get into question and answer session. Should you have a question, please press the star key for one on your dashboard phone.
Speaker Change: Ulya or prompt that your hand has been raised. To do wish to decline from the pulling purpose, please press the star or followed by the tube. If you are using a speaker phone, please lift the hand set before pressing an increase.
Speaker Change: One moment, please for your first question.
Speaker Change: First question is from Henry Western nope.
Speaker Change: Private Investor, please go ahead.
Henry Western: Good morning. I've been curious, you know, at the scale you're at now, you're clearly looking for a partner or a buyout situation during 2024.
Henry Western: Ball Park, how many people?
Henry Western: Parties have you had serious discussions with, beyond kicking the tires.
Henry Western: If any, and for those how many are still alive and how many of said no and why did they say no?
Speaker Change: Henry, that's a very interesting question. Unfortunately, we don't disclose who we've signed confidentiality agreements with or how many confidentiality agreements.
Speaker Change: have been signed typically. I can indicate that over the course of the year that we have
Speaker Change: that we have had an increase in interest in the Mount Todd Gold Project. We recently participated in conferences at Beaver Creek, the precious metal summit, and also in color springs at the Gold Form America's.
Speaker Change: [inaudible] You will have gathered from the the the the the proprietary marks.
Speaker Change: for a 6 million tons per year with targeted production of...
Speaker Change: 150 to 200,000 ounces of gold production annually.
Speaker Change: This size smaller scale.
Speaker Change: with significantly reduced initial capex, his garnered significant interest among interested parties. We have initiated discussions.
Speaker Change: I will be in meetings next week in Perth with some parties. We expect to be signing additional or new confidentiality agreements but the interest in smaller case will mature as that study advances.
Speaker Change: There have been a number of companies who have undertaken significant due diligence, perhaps the one that I can disclose is new crest mining and you will certainly be aware that
Speaker Change: and I can kind of paint a picture of climbing the midst of...
Speaker Change: and their due diligence that Newmont knocked on their door.
Speaker Change: and that transaction was completed rather than a transaction with the VISTA. So there continues to be interest and we're encouraged by that, but unfortunately I'm not able to disclose all of the information that you've requested in your question.
Speaker Change: Okay.
Speaker Change: Maybe one other is from the new drill results.
Speaker Change: this year.
Speaker Change: is the average Grant's proton newly found is that comparable to existing robotic greater or less than.
Speaker Change: What percentage of increase I guess in the orbit it is this year is drilling representate.
Speaker Change: Also, two parts to that. The phase one of the drill program was drilled inside of the, or targeted the boundaries of the Batman deposit.
Speaker Change: which is the host for our reserves at the northern end of the deposit.
Speaker Change: and I think they would be fair to say that in broad terms and until we have the resource model update, I won't know for sure, but I think in broad terms I would say that we have confirmed.
Speaker Change: and that the changes will probably be net net pretty much the same that boundaries of expanded in some areas.
Speaker Change: Shrunk and others, grades were higher in some areas, and we previously thought slightly lower of note at the very north end of what we model as the deposit we did encounter.
Speaker Change: Mineralization outside of the area of varanticipated boundaries and it was higher grade than what we would have expected. So that's a very positive note.
Speaker Change: with regards to phase two of the Drilling Program. We are drilling what we call the South Crossload Zone.
Speaker Change: and this is a zone that we're aware of based on shallow historic drilling.
Speaker Change: But we knew very little about and so the drilling that we're doing right now is helping us understand the type of mineralization and I can comment that
Speaker Change: and what we see in the South Cross-Lode Zone is mineralization that's distinct.
Speaker Change: from what we see in the Batman deposit. The Batman deposit is a sheeted vein system.
Speaker Change: In other words, we have a width of mineralization that varies between 2 and 300 meters where we have
Speaker Change: Small Quartz, Soulfly Dvanes, the Gold Mineralization, the variant thickness from perhaps a millimeter or so up to 10 centimeters, occasionally thicker than that.
Speaker Change: But they're very consistently spaced across this 2-300 meter width with the vane densities on the order of...
Speaker Change: and say, say, 7 to 15 or 20 veins per meter.
Speaker Change: and so that's where the Sheaded Vane System looks like in the South Cross Road.
Speaker Change: We're seeing, we're farther away from the heat source for the deposit, the rock is not as altered.
Speaker Change: the number of fractures or veins.
Speaker Change: is fewer, but we're seeing instances that they're wider and the results that I highlighted in the formal remarks. We're seeing vein intercepts that are in instances.
Speaker Change: Much greater than a meter, and we have encountered vain intercepts that are much higher grade.
Speaker Change: are our grades in the Batman deposit tend to be in the 1-2 gram range and yet in the...
Speaker Change: in the South Crossload Zone, as you heard previously.
Speaker Change: We've had intercepts as high as 50 grams per ton and over half a meter and almost 26 grams per ton, over a meter.
Speaker Change: and anyway, we're still seeking to understand what this means. We will not be completing a resource estimate update until obviously the drilling is completed in all assays and check assays are received.
Speaker Change: but we will be announcing another set of interim drill results in the coming weeks for the South Cross Load.
Speaker Change: and that will provide all of us with perhaps a little bit of understanding of what we're seeing in the South Crossload, but please burn mind that this is early days and we're right now we're our geologists who are working very hard to understand.
Speaker Change: the geology and this may end up giving us a better model for exploration in other parts of the South Cross-Lode and in other targets that we've identified.
Speaker Change: North and East of the Batman Deposit that we know are narrower structures based on our drilling in 2020 to 2022.
Speaker Change: If the South Crosswater develops into a substantial robotic.
Speaker Change: Does that give you two different products to sell? Can you sell that man and sell the car off-flood for separate denominations?
Speaker Change: Now the products that we will sell from any development within the Mount Todd.
Speaker Change: Project umbrella will be gold.
Speaker Change: and our arrangement with Wheaton-Prisis medals, they have a first-writer refusal on, and their royalty covers all of the mining licenses. So they have first-write on any character in my sense of considering contemplating doing with regards to South Cross-Love.
Speaker Change: Okay, thank you very much.
Henry Western: Thank you Henry.
Speaker Change: Ladies and gentlemen, as our reminder, should you have a question, please press the star key followed by the number one.
Speaker Change: There are no further questions at this time, please proceed with closing remarks.
Speaker Change: Alright, thank you Andrew and thank you to all of you who have joined the call today.
Speaker Change: As indicated, we find ourselves in an environment where we see a strong rising gold price, we believe that this will continue.
Speaker Change: The work that we're doing is meant to capitalize on this market. We believe that.
Speaker Change: Market Factor's.
Speaker Change: Specifically the references that we've made to a decreasing number of major gold discoveries will provide tailwind for VISTA and other well advanced developers in the future.
Speaker Change: I'm very excited about the opportunity that's presented by the feasibility study that we will be initiating or expect to initiate later this year. I think that this will...
Speaker Change: Paul.
Speaker Change: Demonstrate.
Paul: The, uh, to a greater degree, the optionality that we see at Mount Todd not only is this a very large.
Paul: and World of Fine Project at 50,000 tons per day, but I think that we will be able to demonstrate.
Paul: Robust economics at a scale that's not only a third that size with the option for future expansion.
Paul: All of this is aimed at helping our shareholders realize greater value from their business investment.
Paul: We believe that we're positioned to deliver.
Paul: A product that will help drive our share price upward in the future. We appreciate the interest that's been shown in VISTA Gold. We find ourselves.
Paul: with sure-priced performance that has been significantly better than many of our peers. We believe that that's a representation of the value that people see in the Mount Todd project.
Paul: We invite those of you who are not sure holders to give serious consideration to.
Paul: Making an investment, a recent change in share price, I believe, creates an interesting...
Paul: Opportunity to initiate a position for those who are already shareholders. We invite you to consider increasing your shareholding and vestigal. We look forward to being able to announce.
Paul: Additional interim drill results for the Phase Two of our drilling program in the coming weeks.
Paul: and later this year we look forward to being able to announce that the feasibility has been...
Paul: when initiated.
Paul: We encourage you to continue to watch, just to go old in the results that we are generating. And we thank you for taking time to join us on this quarterly results call. We wish you all very pleasant day.
Paul: Hey, this is Jonathan. Let's conclude your car from the car for today. We thank you for participating and after you please give it a thanks to your lines.
Paul: and the