Q2 2025 Dundee Precious Metals Inc Earnings Call

Jennifer Cameron: Thank you, and good morning. I'm Jennifer Cameron, Director of Investor Relations, and I'd like to welcome you to the DUNDEE PRECIOUS METALS INC. second quarter conference call. Joining us today are members of our senior management team, including David Rae, President and CEO, and Navindra Dyal, Chief Financial Officer. Before we begin, I'd like to remind you that all forward-looking information provided during this call is subject to the forward-looking qualification, which is detailed in our news release and incorporated in full for the purposes of today's call. Certain financial measures referred to during this call are not measures recognized under IFRS and are referred to as non-GAAP measures or ratios. These measures have no standardized meanings under IFRS and may not be comparable to similar measures presented by other companies. The definitions established in calculations performed by DPM are based on management's reasonable judgment and are consistently applied.

Good day and thank you for standing by, welcome to the Dundee. Precious metals second quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. Please be advised that today's conference is being recorded after the speaker's presentation. There will be a question and answer session to ask a question. Please press star 1, 1 on your telephone and wait for your name to be announced to withdraw your question. Please press star 1 1 again, I would not like to hand the conference over to your speaker today. Jennifer Cameron.

Thank you and good morning. I'm Jennifer Cameron director of investor relations and I'd like to welcome you to the dundy purchase metal. Second quarter conference call, joining us. Today are members of our senior management team including David Ray president and CEO and nav, and dial Chief Financial Officer. Before we begin, I'd like to remind you that all 4 looking information, provided during this call is subject to the 4 looking qualification, which is detailed in our news release and Incorporated in full for the purposes of today's call.

Jennifer Cameron: These measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS. Please refer to the non-GAAP financial measures section of our most recent MD&A for reconciliations of these non-GAAP measures. Please note that unless otherwise stated, operational and financial information communicated during this call are related to continuing operations and have generally been rounded. References to 2024 pertaining to the comparable period in 2024, and references to averages are based on midpoints of our outlook or guidance. I'll now turn the call over to David Rae.

Certain Financial measures refer to during this call are not measures recognized under IFRS and are referred to you as non-gaap measures or ratios these measures have no standardized meanings under IFRS and may not be possible to similar measures presented by other companies. The definitions established in calculations were formed by DPM or based on Management's, reasonable judgment and are consistently applied. These measures are intended to provide additional information and should not be considered in.

David Rae: Good morning, and thank you all for joining us. I am pleased to provide you with an overview of our Q2 results to provide insights into our achievements during this period. It is proud to report that DPM delivered record financial results during the quarter, including record revenue, earnings, and free cash flow results, which reflect reliable high margin production from our portfolio and the strength of the current gold price environment. This has been a defining quarter for DPM, not only in terms of our record results, but strategically, as our proposed acquisition of Adriatic, announced in June, creates a premier mining business to deliver peer-leading growth. The response to the proposed transaction from both our investors and the broader market has been notably positive, which I believe highlights the clear strategic merits of the deal.

In isolation or as a substitute for measures prepared in accordance with IFRS. Please refer to a non-gaap financial measures section of our most recent mdna, reconciliations of these non-gaap measures. Please note that unless otherwise stated operational and financial information, communicated during this call are related to continuing operations. And have generally, been rounded references to 2024 pertaining to the concept of periods in 2024 and references to averages are based on midpoints of our Outlook or guidance. I'll now turn the call over to David Ray.

Good morning, and thank you all for joining us.

I'm pleased to provide you with an overview of our second quarter results to provide insights into our achievements during this period.

Throughout to report, the DPM delivered record Financial results. During the quarter including record Revenue earnings and free cash flow results which reflect reliable high margin production from our portfolio and the strength of the current goal for us environment.

This has been a defining quarter for DCM. Not only in terms of our record results, but strategically is our proposed. Acquisition of Adriatic announced in June creates a premium mining business to deliver peer leading growth.

David Rae: The virus operation is an excellent fit with our operating expertise and financial strength, and its addition to our portfolio offers a clear and compelling value proposition for all of our shareholders. This represents a key next step in our growth strategy and consolidates our position as a mid-tier precious metals producer. The shareholder vote to approve the transaction is scheduled for August 13, and we have submitted the documentation for the Bosnian merger council. We continue to anticipate closing the transaction in Q4. Turning now to the highlights from Q2, which include solid production of 61,000 ounces of gold and 6.4 million pounds of copper, generating strong margins with an all-in sustaining cost of $1,011 per ounce of gold sold, compared to an average real-life gold price of $3,334.

The response to the proposed transaction from both our investors and the broader market has been notably positive, which I believe highlights the clear strategic merits of the deal.

The virus operation is an excellent fit with our operating expertise and financial strength, and its addition. To our portfolio offers, a clear and compelling value proposition, for all of our shareholders.

This represents a key next step in our growth strategy and consolidates our position as a mid-tier precious metals producer.

The shareholder vote to approve. The transaction is scheduled for August the 13th and we've submitted the documentation for the Bosnian merge account.

We continue to anticipate closing the transaction in the fourth quarter.

turning now to the highlights from the second quarter which include solid production of 61,000, Oz of gold and 6.4 million pounds of copper

David Rae: We continue to consistently deliver free cash flow, generating a record $95 million during the quarter and further strengthening our financial capacity to fund growth. We also continue to advance our organic growth pipeline, which I will touch on in a moment. Looking at our operations in more detail, Chelopech mine's performance was in line with the mine plan, producing 47,000 ounces of gold and 6.4 million pounds of copper, with an all-in sustaining cost of $652 per ounce of gold sold. Cash costs of $63 per tonne of gold processed were on target for the quarter, reflecting Chelopech mine's track record of solid, efficient operation. The mine is on track to meet its 2025 guidance targets for the year. We continue to prioritize in-mine and brownfields exploration work to further extend mine life at Chelopech mine, targeting a 10-plus year reserve life.

Generating strong margins with an all-in sustaining cost for 1,000 and the 1111 dollars per ounce of gold sold compared to an average real life gold. Price of 3,334 and we continue to consistently deliver. Free cash, flow generating a record, 95 million during the quarter and further strengthening our financial capacity to fund growth.

We also continue to advance our organic growth pipeline, which I'll touch on in a moment.

Looking at our operations in more detail, Chet's performance was in line with the mine plan, producing 47,000 oz of gold.

And 6.4 million pounds of copper.

With an all-in sustaining cost of 682 per ounce of gold gold.

Cash costs of $33 per ton of all processed, we're on target for the quarter, reflecting challenges, track record of solid efficient operation and the mind is on track to meet its 2025 guidance targets for the year.

David Rae: During the quarter, results from initial drilling at the wedge zone deep target discovered a new zone, 150 meters downhole of contiguous pyrite, which high sulfur mineralization. The target, which remains open in multiple directions, is located within the northern flank of Chelopech mine, within the mine concession and 300 meters below existing mineral reserves. We are increasing the 2025 Chelopech mine exploration program in part to expand the scope of this mineralization and to define the geological setting and structural context. In addition, 12,000 meters of exploration drilling has been planned to test this target to vertical extent and continuation along the stripe, as well as continuing to test the mineral potential of the shallow levels on the northeastern and southern flanks of the Chelopech mine concession. Drill testing at newly generated targets has already commenced and will continue to year-end 2025.

We continue to prioritize in Mound in mine and brownfield's exploration work to further. Extend my life of chale Target targeting a 10 plus year Reserve Life

Results from initial drilling at the wedged Zone. Deep Target. Discovered a new Zone. 150 M down hall of contiguous, pyrite, which high sulfidation mineralization.

The target which remains open in multiple directions is located within the northern flank of Chalet within the mine. Concession, and 300 M below existing mineral Reserves.

We're increasing the 2025, Chalet, exploration program in part to expand the scope of this mineralization and to define the geological setting and structural context

In addition to 12,000, meters of exploration, drilling has been planned to test, this target, to vertical extent and continuation along the strike, as well as continuing to test the mineral potential of the shallow levels on the northeastern and Southern flanks of the Chalet. Mine concession.

David Rae: Ada Tepe mine produced 14,200 ounces of gold with an all-in sustaining cost of $1,166 per ounce of gold sold. As we guided at the beginning of the year, Ada Tepe mine's production is expected to nearly double in the second half of the year compared to the first half due to cell sequencing in the IMWA. With higher production expected in the second half of the year, Ada Tepe mine is on track to achieve its guidance. We continue to focus on developing quality assets, and our growth priority is advancing Čoka Rakita project II production, which is targeted for 2028. A feasibility study is advancing as planned and is expected to be completed by year-end. Most of the surface and underground geotechnical and hydrogeological drilling is now complete.

Drill testing of newly. Generated targets, has already commenced and will continue to year end 2025?

At a tea produced 14,200 ounces of gold with an all-in sustaining cost of 1166 per ounce of gold sold. As we guided at the beginning of the year, had a Tee's production is expected to nearly double in the second half of the year compared to the first half due to cell sequencing in the imwa.

With higher production expected in the second half of the year, Dundee Precious Metals Inc. is on track to achieve its guidance.

We continue to focus on developing quality assets, and our growth priority is advancing Choker with key production, which is targeted for 2028.

The feasibility study is advancing as planned and is expected to be completed by year end.

David Rae: Activities planned for the remainder of 2025 in support of a construction decision in mid-2026 include progressing the design to the basic engineering level, advancing the budget execution readiness, and commencing operational readiness activities, leveraging Čoka Rakita project's regional proximity to Chelopech mine to train and develop key personnel for operating roles. In parallel, permitting activities continue to advance. We submitted the final report on mineral reserves and mineral resources, known as the elaborative reserves, to the relevant authorities in Q1 and continue to engage with relative stakeholders regarding the spatial plan. In terms of camp-wide exploration, our drilling program focused on testing high-priority targets proximal to our Čoka Rakita project. That continues to yield results from a large prospective land package.

Most of the surface and underground, geotechnical and hydro, hydro geological drilling is now complete.

activity activities planned for the remainder of 2025, in support of a construction decision in the mid 2026 include progressing, the design to the basic engineering level

Advancing the project execution Readiness and commencing operational Readiness activities, leveraging choker Roz, Regional proximity to chello to train and develop Key Personnel for operating roles.

In parallel, permitting activities. Continue, to advance we submitted the final report on Mineral reserves and mineral resources known as the elaborative reserves to the relevant authorities in the first quarter, and continue to engage with relative stakeholders regarding the spatial site.

David Rae: At the Čoka Rakita project, results are continuing to confirm the presence of a large high-grade copper-gold-silver strand system with mineralization concentrated along both the eastern and western sides of the intrusion. Based on drilling to date, mineralization has been detected over a one-kilometer strike length, up to 300 meters vertically and up to 500 meters away from the intrusion. The drill program continues to expand the Čoka Rakita discovery announced in February 2025, and we have yet to define its limits as it remains open in multiple directions and at depth. We are also advancing drilling at the Rakita North and Bayasaka prospects and look forward to providing further updates on our progress, likely in the third quarter. At the Loma Larga project in Ecuador, we achieved a significant milestone with the receipt of the environmental license in June.

In terms of C-C wide exploration, our dwelling program focused on testing high-priority targets proximal to our Choker Bikita project, and that continues to yield results from a large perspective land package.

A dim Mutual plot of results of continuing to confirm the presence of a large high-grade copper. Gold silver scan system with mineralization concentrated along, both the eastern and western sides of an intrusion

Based on drilling to date. Mineralization has been detected over a 1, kilometre strike, length up to 300, M, 30 kg, and up to 500 meters away from the intrusion.

The drill program continues to expand. The Demetra plot of Discovery announced in February 2025 remains open in multiple directions and at depth, and we have yet to define its limits.

We're also advancing drilling at the rakita. North and Via Sokka prospects and look forward to providing further updates on our progress, likely in the third quarter.

David Rae: This follows the successful completion of the prior informed indigenous consultation process in May and is the result of a rigorous process by the government to ensure high Ecuadorian standards are applied in the development of mining projects. Negotiations for the exploitation agreement have been initiated, and we are also planning a 23,000-meter drilling campaign for Loma Larga. This program will prioritize geotechnical and hydrogeological monitoring holes, as well as metallurgical and resource infill drilling, and is expected to commence in Q3. Overall, we continue to deliver strong results, and with both mines on track to achieve our 2025 guidance and execute on our strategy to deliver above-average returns for our stakeholders. I will now turn the call over to Navin Dyal for a review of the financial results.

At the lomell laga project. In Ecuador, we achieved a significant Milestone with the receipt of the environmental licenses in June, this follows the successful completion of the prior informed indigenous consultation process in May, and as the result of a rigorous process, by the government, to ensure High, Ecuadorian standards are applied in the development of mining projects.

Negotiations, for the exploitation agreement have been initiated, and we're also planning a 23,000 meter drilling campaign for LA Malaga.

This program will prioritize, geotechnical and hydro hydro geological monitoring holds as well as metal vertical and resource, infill, Drilling and is expected to commence in Q3.

Overall, we continue to deliver strong results and with both Minds on track to achieve our 2025 guidance and execute on our strategy to deliver above average returns for our stakeholders.

Navin Dyal: Thanks, Dave. I will be touching briefly on the financial highlights for the quarter, provide an update on how we are tracking to our guidance for the year, as well as any changes, and conclude with some commentary on our balance sheet and return of capital program. All of my remarks will focus on results from continuing operations unless otherwise noted. Looking at our financial results, second quarter highlights include revenue of $186 million, adjusted net earnings of $88 million or $0.52 per share, cash flow provided from operating activities of $100 million, and free cash flow of $95 million. Overall, we saw record financial results during the quarter, which reflected our strong operating performance, the low-cost nature of our operations, and a favorable commodity price environment.

I'll now turn the call over to Navin for a review of the financial results.

Thanks Dave, I'll be touching briefly on the financial highlights for the quarter, provide an update on how we are tracking to our guidance for the year as well as any changes include with any some commentary in our balance sheet and return of capital program.

all of my remarks will focus on results from continuing operations unless otherwise noted

Highlights include revenue of 186 million, adjust the net earnings of 88 million or 52 cents per share. Cash flow provided from operating activities of 100 million.

And free cash flow of 95 million.

Navin Dyal: Looking at our earnings and cash flow in more detail, revenue of $186 million in the quarter was 19% higher than 2024 due to higher realized metal prices, partially offset by lower volumes sold at Ada Tepe mine. Adjusted net earnings in the second quarter of $88 million or $0.52 per share, increased compared to the prior year due primarily to higher revenue and lower evaluation expenses as a result of costs related to the Čoka Rakita project now being capitalized due to the project's advancement to the feasibility study stage. This was partially offset by higher costs, primarily related to higher mark-to-market adjustments to share-based compensation expenses, reflecting DPM's strong share price performance this year. Cash flow provided from operating activities of $100 million for the quarter was lower than the prior year, mainly due to the timing of collections from sales and payments to suppliers.

Overall, we saw record Financial results during the quarter, which reflected our strong operating performance, the low-cost nature of our operation and a favorable commodity price environment.

Looking at our earnings and cash flow in more detail revenue of 186 million in the quarter was 19% higher than 2024 due to higher realized metal prices partially offset by lower volumes of Gold. Sold at at a t.

Adjust the net earnings in the second quarter of 88 million or 52 cents per share. Increase compared to the prior year. Due primarily to higher revenue and lower evaluation expenses, as a result of costs related to the choco richita project. Now being capitalized due to the Project's advancement to the feasibility study stage.

This is, partially offset by higher costs primarily related to higher mark-to-market adjustments.

The share-based compensation expenses reflecting DPMS strong, share price performance this year.

Navin Dyal: Free cash flow, which is calculated before changes in working capital, was $95 million for the quarter, an increase of $12 million compared to 2024, due primarily to higher adjusted net earnings generated in the quarter. Taking a look at our cost metric, all-in sustaining costs for the first half of the year of $1,118 per ounce of gold sold was 41% higher than the prior year, due primarily to lower volumes of gold sold, higher mark-to-market adjustments to share-based compensation expenses, lower byproduct credits reflecting lower volumes of copper sold, and a stronger euro relative to the U.S. dollar, all partially offset by lower freight charges.

Cash flow provided from operating activities of 100 million for the quarter was lower than the prior year. Mainly due to the timing of collections from sales and payments to suppliers.

Free cash flow, which is calculated before changes in working capital was 95 million for the quarter and increase of 12 million compared, to 2024, to primarily to higher adjusted net earnings generated in the quarter.

Navin Dyal: Given our strong share price performance in the first half of the year, the mark-to-market adjustments to share-based compensation expenses resulted in an increase of $138 per ounce of gold sold, compared to an increase of only $26 per ounce of gold sold in 2024. We reconfirmed our 2025 guidance for all-in sustaining costs of $780 to $900 per ounce of gold sold, with lower costs per ounce expected in the second half of the year, commensurate with the nearly doubling of production from Ada Tepe mine, keeping in mind that our all-in sustaining cost guidance remains subject to external factors, such as the mark-to-market impact of Dundee Precious Metals Inc. share prices, as well as metal prices and foreign exchange movements relative to our guidance assumption.

Taking a look at our cost. Metrics all in sustaining costs for the first half of the year of 1118 per ounce of gold. Sold was 41% higher than the prior year to primarily to lower volumes of Gold. Sold higher Mark to Market adjustments, to share, based compensation expenses. Lower byproduct credits, for reflecting in lower volumes of copper sold and a stronger Euro relative to the US dollar all partially offset by lower Freight charges.

Given our strong share price performance in the first half of the year, the mark to Market adjustments. The Char based compensation expenses, resulted in an increase of 138 per ounce of gold soap compared to an increase of only $66 per ounce of gold sold in 2024.

We reconfirmed our 2025 guidance for all in sustaining costs of 780 to $900 per ounce of gold sold.

With lower cost per us expected. And the second half of the year, commensurate with the nearly doubling of production from at its Epic.

Navin Dyal: In terms of our capital spending, sustaining capital expenditures of $6 million for the quarter were lower than 2024, due primarily to lower expenditures on mobile equipment at Chelopech mine, as expected, partially offset by higher deferred shipping costs as a result of higher shipment ratios at Ada Tepe mine, in line with the mine plan. Gross capital expenditures of $16 million for the quarter were higher than 2024, as a result of costs related to the Čoka Rakita project being capitalized from the beginning of 2025. Last night, we provided an updated three-year outlook supporting our continued focus on funding our high-quality organic growth pipeline while maintaining our portfolio of high-margin operations, which has generated our exceptional track record of delivery. The three-year outlook remains unchanged except for the following update to the company's guidance for 2025.

Keeping in mind that our own understanding cost guidance, remains subject to external factors such as the mark to Market impact of DPM share prices as well as metal prices and foreign exchange movements relative to our guidance assumptions.

In terms of our Capital spending sustaining Capital expenditures of 6 million for the, for the quarter, we were lower than 2024 due primarily to lower expenditures on mobile equipment, at Shell Edge as expected, partially osted by higher deferred shipping costs as a result of higher shipping ratios at atete in line with the mine plan.

growth Capital expenditures of 16 million for the quarter were higher than 2024, as a result of costs related to the choke raita project being capitalized from the beginning of 2025,

Last night we provided an update in 3 year outlook supporting our continued focus on funding. Our high-quality organic growth pipeline while maintaining our portfolio of high margin operations which is generated our exceptional track record of delivery.

Navin Dyal: Gross capital expenditures related to the Loma Larga project are now expected to be between $23 million and $25 million, up $11 million due primarily to the receipt of the environmental license for exploitation, representing an important milestone, allowing the company to resume drilling at Loma Larga project. In addition, based on positive results, exploration expenses are now expected to be between $44 million and $49 million, up $8 million to support exploration activities associated with near mine exploration on the Chelopech mine concession and drilling at the Brevenet exploration life. The company's three-year outlook does not reflect the potential impact of the proposed acquisition of Adriatic. Upon closing of the transaction, we intend to update our production and cost guidance, along with other key operational and financial metrics, to incorporate the contribution of Adriatic on a gold-equivalent basis.

The 3 year outlook remains unchanged, except for the following updates to the company's guidance for 2025.

Growth Capital expenditures related to the lomma larger project are. Now expected to be between 23 million and 25 million up 11 million due to primarily the receipt of the environmental license for exploitation.

Representing an important Milestone allowing the company to resume drilling at level Largo. In addition based on positive results, expiration and expenses are now expected to be between 44 million, and 49 million up 8 million to support expiration activities, associated with near mine. Exploration on the Chelle, fetch mind, concession and drilling at the banana exploration licence.

Navin Dyal: This approach ensures our guidance remains transparent, reliable, and aligned with the timing of the transaction. We continue to maintain a strong balance sheet and cash flow position, with a consolidated cash balance of $332 million, restricted cash pursuant to the agreement to acquire Adriatic of $465 million, no debt, and a $150 million undrawn revolving credit facility. Given the strength of our balance sheet and our positive outlook for continued strong free cash flow generation, we are in a unique position with the financial flexibility to fund growth opportunities, such as the acquisition of Adriatic and our investments in our development and exploration activities, while continuing to return a portion of our free cash flow to our shareholders in line with our commitment to capital discipline.

The company's 3 year outlook does not reflect the potential impact of the proposed, acquisition of Adriatic upon closing of the transaction. We intend to update our production and cost guidance, along with other key operational and financial metrics to incorporate the contribution of Adriatic on a gold equivalent basis. This approach ensures our guidance remains transparent reliable and aligned with the timing of the transaction.

We continue to maintain a strong balance sheet and cash flow position with a Consolidated cash balance of 3332 million restricted, cash pursuant to the agreement to acquire Adriatic of 465, million, no debt and a 150 million undrawn, revolving credit facility.

Acquisition of Adriatic and our investments in our development and exploration activities.

Navin Dyal: In the first half of 2025, we repurchased 10 million shares at a total cost of $116 million under the company's normal court issuer bid, or NCIB, and paid approximately $14 million of dividends. In closing, we continue to deliver strong performance from our mining operations. We are focused on growth, and we're in a strong cash position to achieve our guidance and continue our track record of generating significant free cash flow. I'll now turn the call back to Dave for his concluding remarks.

While continuing to return a portion of our free, cash flow to our shareholders in line with our commitment to Capital discipline.

In the first half of 2025, we repurchased 10 million shares at a total cost of 116 million under the company's normal courts issue or bid, or ncib and paid approximately 14 million of dividends.

David Rae: Thanks very much, Navin. Overall, we continue to deliver. Sorry, excuse me. This is an exciting time for DPM and our shareholders as we look to our future as a growing precious metals producer, offering a peer-leading development pipeline, a strong balance sheet, and capital returns, all of which are underpinned by our exceptional operational track record. Our portfolio is generating solid, consistent results, and we are very well positioned as one of the lowest costs, highest growth producers. We are generating strong free cash flow and delivering peer-leading returns to shareholders. We are progressing Čoka Rakita and its feasibility study for an accelerated construction decision. We have substantial financial strength to fund growth opportunities and exploration, and we are focused on executing our strategy to deliver above-average returns for our shareholders as a mid-tier precious metals company.

In closing, we continue to deliver strong performance from our mining operations, we are focused on growth and we're in a strong cash position to achieve our guidance and continue our track record of generating significant free, cash flows. I'll now turn the call back to Dave, for his concluding remarks

Thanks very much Nathan.

Overall, we continue to deliver sorry. Excuse me. Um, this is an exciting time for DPM and our shareholders, as we look to our future. As a growing precious metals producer, offering a peer leading development pipeline, a strong balance sheet, and capital returns all of which are underpinned by our exceptional, operational track records.

Our portfolio is generating solid consistent results and we are very well positioned as 1 of the lowest costs to the highest growth produces. We're generating strong free, cash flow and delivering peer leading returns to shareholders with progressing choker with keita, um, and its feasibility study for an accelerated construction decision. We have substantial Financial strength to fund growth opportunities and exploration and we focus on executing our strategy.

David Rae: DPM has a clear path forward, and we are very excited about our future. I would now like to open up the call for any questions.

To deliver above average returns for our shareholders as a mid-tier. Precious metals BPM is a clear path forward and we very excited about our future.

Operator: Thank you. As a reminder, to ask a question, please press star one, one on your telephone and wait for your name to be announced. To withdraw your question, please press star one, one again. One moment for questions. Our first question comes from Wayne Lam with TDQ. You may proceed.

I'd now like to open up the call for any questions.

Thank you as a reminder, to ask a question. Please press star 1, 1 on your telephone and wait for your name to be announced to withdraw your question. Please. Press star 1 1 again, 1 moment for questions.

Wayne Lam: Oh, hey, good morning, guys. Just a question on the Adriatic deal. Obviously, you guys have done a lot of work around the due diligence process with the independent study in conjunction with the acquisition. Just wondering if you can maybe comment on the most recent update there and the revision and guidance post the announcement. Then just curious, in the month leading up to the closing, how much input or influence will you have in terms of the operations, given your reinterpretation of what is needed to get the mine to a steady state?

Our first question comes from Wayne land with TD, you may proceed.

David Rae: Yeah, thanks for the question, Wayne. First of all, the update in the second quarter, that changes nothing on our view on virus. We had anticipated and made our own assessments of what we expected, and this was in line. In terms of your second question, which was what is going to happen just ahead of closing, it is important that we recognize that we need to operate as independent companies. While we are talking about things that we might do technically and opportunities in terms of learning for Adriatic to the decision as to whether they do or do not take advantage of you. So we are maintaining an appropriate distance, but of course, we are talking about integration and how we might go about doing that. But as I just to repeat, we are separate companies, and we have to remain so until closing.

Oh, hey morning guys. Um, just just a question on the Adriatic deal. Uh obviously you guys have done a lot of work around the due diligence process with the independent study in conjunction with the acquisition. Uh, just wondering if you can maybe comment on the most recent update there and the revision and guidance post the announcement and then just curious in the, in the months leading up to the closing, how much input or influence will you have, in terms of the operations, given your reinterpretation of what's needed to get, get get the mind to a steady state.

Yeah, thanks for the question Wayne. Um, first of all, you know, the updates in the second quarter of that change is nothing on our view on V, you know, we don't anticipate it and you know, made our own assessments of what we expected and this is in line in terms of your second question. Which was, you know what's going to happen? Just ahead of closing, it's important that we recognize that we need to operate as independent companies and, you know,

While we are talking about things that we might do technically and opportunities in terms of learning for Adriatica, deserving as to, whether they do or do not take advantage of you. So we're maintaining an appropriate distance but of course we are talking about integration and how we might go about doing that. But as I just to repeat, we are separate companies and we have to remain. So until closing.

Wayne Lam: Great. Thanks. Then maybe at Ada Tepe mine, you guys have been fairly consistent in terms of guiding the wind down in operation next year. But just wondering, given the significant change in the gold price, particularly versus the $1,600 resource price assumption, would you see any possibility for additional material via an incremental layback? Then just maybe curious if there might be any renewed potential to perhaps consider processing or from other deposits within a reasonable truckable distance.

David Rae: Wayne, in terms of obviously, if we keep track of what is going on, we make sure that whatever we are treating is economic at any point if the share price were to go the other way. Similarly, we understand what is going on in terms of what will happen with an increased share price, and the answer simply is no. It is not going to change the outlook, so we do keep track of that. We do anticipate that we will close Ada Tepe mine in the second quarter of next year. Also, we are not considering the idea of using this as a custom mill treatment facility for other, let us say, potential mines.

Great. Uh thanks. And then uh maybe add a tape. Uh you guys have been fairly consistent in terms of uh guiding the wine down in operation next year. Uh, but just wondering given the significant changes in the gold price, uh, particularly versus the 1600 resource price. Assumption would you see any possibility for additional material via an incremental layback or and and then just maybe curious, um, if there might be any renewed potential to perhaps, uh, consider processing or, uh, from other, uh, deposits within a, a reasonable truck distance.

Yeah. Uh Wayne in terms of obviously we keep track of what's going on and we make sure that whatever we're treating um is economic at any point with the share price where to go the other way. Similarly we understand you know what's going on in terms of what will happen with an increased share price and the answer simply is no so it's not going to change the the Outlook. So we do keep track of that. We do anticipate that we will close out a t in the second quarter of next year. And also we're not considering the idea.

Wayne Lam: Okay, got it. Thanks. And then maybe just last one. At Loma Larga project, obviously, some good news here in terms of the environmental license. Just wondering, with the restart drilling and the upcoming update fees, how quickly could that asset now be moved forward to a potential construction decision? And has the relationship with the community evolved to where they would be fully on board to greenlight the project if, say, you were to decide to build it tomorrow?

Using this as a custom Mill uh treatment facility for other other um website potential months.

David Rae: Okay, we obviously need to go back to drilling. Starting with that, we have 22,000, 23,000 meters of drilling planned. This is going to be primarily focused on geotech and hydrogeological information, as well as combination. That is to support the final decisions within the feasibility. That is going to take, let us say, between the feasibility and the drilling, somewhere north of six months for the information to be brought in. For then the reporting, you are looking at at least another six months. This is some way out. Basically, watch this space in terms of what drilling is progressing and when we are actually ready to bring that into the feasibility study. In terms of the second part of the relationship, this is an ongoing thing where you are continuing to develop the relationship with the local communities.

Construction decision. And as a relationship with the community evolved to where there would be uh fully on board to Greenlight the project to say you were just to decide to build it tomorrow.

So we obviously need to go back to drilling. So, starting with that, we have, um, 22 23,000 meters of drilling plans, this is going to be primarily focused on G the Geotech and hydrogeological.

David Rae: There are concerns that you have to address and overcome in the sense of people's perceptions of what might happen, which unfortunately are colored by other unfortunate situations with illegal and informal mining in the country. We continue to build that. We have time until we get to a point where there is a construction decision and anticipate success in bringing forward all of our stakeholders such that we can start constructing and bring to fruition Loma Larga in good time.

Information, as well as condemnation. So that's to support the final decisions within the field. That's going to take, uh, let's say between the feasibility and the drilling somewhere north of 6 months for the the information to be brought in for then the reporting you're looking at at least another 6 months. So with some way out. So basically you know watch this space in terms of what drilling is progressing and when we're actually ready to bring that into the feasibility, study in terms of the second part, the relationship. This is an ongoing thing where you're continuing to develop the relationship.

Uh, with the local communities and there are concerns that you have to address and overcome in the sense of people's perceptions of what might happen.

Which unfortunately, our colored by other unfortunate situations with illegal and informal informal Market.

Country.

So you know, we continue to build that we have time until we get to a point where there is a construction decision in the anticipate success in bringing forward all of our stakeholders.

That we can.

Start constructing and bring to fruition Loma larger in the time.

Wayne Lam: Okay, got it. All right. Yeah, thanks for taking my questions.

David Rae: Thank you.

Okay, got it. All right. Uh yeah thanks for taking my questions.

Operator: Thank you. Our next question comes from Fahad Turik with Jeffries. You may proceed.

Thank you.

Don Demarco: Hi, thanks for taking that question. Continuing on the theme of Loma Larga, now that you have de-risked it with the environmental permit and you are doing some additional drilling in the second half of this year, talk about how Loma Larga fits into the rest of the portfolio as a priority. It stands out a bit, I guess, geographically. Think about, is that something that you think would be core to the portfolio longer term, or is that something that you are looking to monetize after it has been de-risked some more?

Thank you. Our next question comes from Fahad Turk with Jeffrey. You may proceed.

Hi. Thanks for taking my question. Maybe just continuing on the theme of Loma larga um now that you've de-risked it with the environmental permit. Um,

you're doing some additional drill Drilling in the second half of this year, maybe talk about

How low and Largo fits into the rest of the portfolio as a as a priority. I mean, it stands out a bit.

David Rae: Yeah, thanks, Fahad. So if we have a look at Loma Larga, historically, we've been progressing this project at the pace that we can. There's been some necessary steps in terms of information that we've needed to provide, which we've now completed, and also the prior informed consultation, all of which have been completed and now successfully got the EIA and in consultations with the government about the exploitation permit. So in terms of fit, we'd always identified this asset as a good fit, actually, with our skill set. This, you know, some years back, well before we acquired the asset back in 2021, clearly, in proximity of our existing operations, Čoka Rakita and the other opportunities in Serbia and now in Bosnia with Herzegovina, these things obviously stand out in terms of the opportunity to realize value through proximity expertise, deployment of capital and this type of thing.

I guess geographically, um, and maybe think about is that something that you think would be core to the portfolio longer term? Or is that something that you're looking maybe to monetize after it's been de-risked some more.

Yeah. Um, thanks F. So, if we have a look at lomell August. So historically, we've been progressing. This project to the PACE that we can. There's been some necessary steps in terms of information that we've needed to provide, which we've now completed. And also, the prior informed consultation, all of which, you can think completed. And now, successfully got the eia in an in conversations with the government about the exploitation permit. So, in terms of fit,

Um, we'd always identified this asset as a good fit actually with our skill set. And this, you know, some years like, well before we acquired the asset back in 2021, um, you know, clearly in proximity of our existing operations, choco Wiki and the other opportunities in Serbia, and now in Bosnia and realize value through

David Rae: But we do see Loma Larga as an asset that will bring value to the organization. So we'll continue to pursue that to a point where we're expecting it to construct and operate. We will, of course, as we do with all of our assets, consider strategically what's the best thing for the organization going forward. But at this point, we anticipate construction and realizing production.

Proximity expertise, you know, of deployment of capital and this type of thing. But we do see Low Malaga as an asset that will bring value to the organization. So, we'll continue to pursue that to a point where we're expecting to construct and operate.

Um, we will, of course, as we do with all of our assets, consider strategically, what's the best thing for the organization going forward? But at this point we anticipate construction and realizing production.

Don Demarco: Okay, that is clear. When is the updated feasibility study expected again for Loma Larga? I know it was the second quarter, but then it got pushed out with the Adriatic transaction. What is the most recent timeline?

David Rae: That remains the case at this point. We will look to release that at an appropriate time so that information is available. Recall, it was not a complete feasibility update. It was only focused on the capital increases since the IMV study plus impacts on OpEx and metal prices, but it did not take into account updates to reserves and resources due to cut-off grade changes. Part of the 22,000 meters will do some work actually on that. The next feasibility update, I would anticipate cut-off grade change, resource and resource implications, and then the capital and OpEx coming to a full feasibility study. In terms of timing, we are anticipating at this point that that is something that will come out later, potentially at the end of the transaction when we close the transaction with Adriatic.

Okay, that's clear. And then maybe just a housekeeping item. What when is the update if feasibility study expected again for Loma, I know as a second quarter but then it got pushed out with the with the Adriatic transaction. So just what's the most recent timeline?

So that remains the case at this point, you know, we'll look to release that as an appropriate time. So that information is available. We call. It was not a complete feasibility update, it was only focused on the capital increases since the IMD study plus impacts on Opex and metal prices. But it did not take into account updates to reserves and resources, due to car upgrade changes. So, part of the 22,000 meters, will do some work actually on that. So, for the next feasibility update, I would anticipate cut upgrade change is often resource implications and then the capital and Opex coming to a full feasibility study.

So in terms of timing, you know, we're anticipating at this point that that is something that will come out later. Potentially at the end of the transaction when we when we close the transaction with adriene

Don Demarco: Okay, great. Thank you.

Okay, great. Thank you.

Operator: Thank you. Our next question comes from Eric Winmill with Bank of Nova Scotia. You may proceed.

Eric Winmill: Hey, good morning, David and team. Thanks for taking my question. I just want to follow up quickly on Serbia. You know, you are obviously increasing the exploration budget there. I guess you are liking what you are seeing. Maybe on this Tulare exploration license, which we do not hear a whole lot about, any comments there? Also, I guess seeing some forest fires in country, I am assuming you are still not seeing any impact from those. Thank you.

Thank you. Our next question comes from Eric winnwell with Scotia Bank. You may proceed.

David Rae: Yep. So, we continue to find Serbia an attractive destination to do the work that we do within there since 2004. So, we have a long track record with the local communities and the authorities. Clearly exciting in terms of exploration upside. I think where we are really focusing our attention at the moment is at a Čoka Rakita project depth. So, it takes a little longer to be able to get information that we can share in terms of what's happening. We have indicated that drilling does continue on it to meet a pot up with an intent to expand the view on that discovery. At this point, we have communicated that it is a one-kilometer strike length, 300-meter depths at a minimum, and 500-meter width. So, it is very exciting. We anticipate there will be more information coming on this in the fall.

Question. Uh, just want to follow up quickly on Serbia. You know, you're obviously increasing expiration budget there. I guess you liking what? You're seeing, um, and maybe on this, uh, tar exploration licence, which we don't hear a whole lot about, uh, any comments there and also, I guess seeing some forest fires in country. I'm assuming, uh, you're still not seeing any impact from those. Thank you.

Yep. So we, you know, continue to find Serbia and attractive destination to do the work that we do within this since 2004. So we have a long track record for the local communities in the authorities. Clearly exciting in terms of exploration upside, um, I think, you know, the where we really focusing our attention at the moment is at a kilometer death. So it takes a little longer to be able to get information that we can share in terms of what's Happening. Uh, we have indicated that drilling does continue to monitor the mutual pots up with an intent to expand the, um, The View on that Discovery. And, you know, at this point, we've communicated that it's a 1, kilometre strike length, 300 meter depths at a minimum of 500 meter with

David Rae: In terms of Tulare, we have done work on this. Historically, there were two different companies that we brought in under one name. These were assets we have been involved in since 2004, but other people were directing that work through until 2016 when we took them both back in. Tulare was a copper-focused asset as opposed to Avala, which was more gold-focused. So, we have done some work on this during the course of the year. I believe we are 3,300 meters through a 6,600-meter drill program. So, by the end of the year, we will have a sense of what this is. But, we would see that.

It is very exciting. We anticipate. There'll be more information coming on this in the form.

In terms of um, tari. Uh, we have done work on this. Historically, there were 2 different companies that we brought in under under 1 name. Uh, these were assets, we've been involved in since 2004 but other people were directing that work through until 2016 when we took them both back in.

David Rae: If you look at prior technical reports, we will tell you the same thing. So, it is a big lower-grade asset that we are trying to just fully understand with the idea being that we want to realize the value of these sort of hidden gems in our portfolio.

Taree was a copper focused asset as opposed to aala, which was more gold focused. Um, so we've done some work on this, due in the course of the year. I believe we're 3,300 meters to do a 6600 meter draw program. So by the end of the year, we'll have a sense of, you know what this is, but it it's it has, um, we would see that and if you look at prior technical reports, they'll tell you the same thing. So it's a big lower grade asset that we're trying to just fully understand with the idea being that we want to realize the value of being sort of hidden gems in our portfolio.

Eric Winmill: Okay, I will appreciate that. Forest fires again, no impact in country at this point, or?

David Rae: Oh, yeah, sorry, Eric, I did not answer that. The answer is no. We obviously watch for that. We have got forest fires in both Bulgaria and Serbia. So the answer is no. We continue to support the authorities and groups around us to do what we can as stakeholders within our communities to make sure that not only our assets are protected, but our stakeholders around us are as well.

Okay, I appreciate that. 10, forest fires again. No, impact in country at this point. Or oh yeah, sorry I didn't answer that. The answer is no. We obviously uh watch

Watch for that. We've got forest fires in both Bulgaria and Serbia. So the answer is no and we continue to support the authorities and groups around us to do what we can, as stakeholders within our communities to make sure that not only our assets are protected but our

Stakeholders around his own as well.

Eric Winmill: Okay, great. No, I really appreciate that. Thanks very much. I'll hop back in the queue. Cheers.

Operator: Thank you. As a reminder, to ask a question, please press star one, one on your telephone. Our next question comes from Don DeMarco with National Bank Financial. You may proceed.

Okay, great. No, I really appreciate that. Uh, so thanks very much. I'll hop back in the queue. Okay, cheers.

Don Demarco: Thank you, operator. Good morning, David and team. My first question is for Navin. Navin, I see the $465 million that has been moved into restricted cash ahead of an Adriatic closing. Can you comment on this in the context of the $437 million cash component of the purchase price and the $200 million in closing costs and debt repayments and so on that were in addition to that? Is that restricted cash amount enough?

Thank you. As a reminder, to ask a question, please press *1, 1 on your telephone. Our next question comes from Donald DiMarco with National Bank. You may proceed.

Thank you, operator. And uh, good morning, David and Dean. Um, my first question is for Navin, uh, so so Navin. I see the 465 million that's been moved in to restricted cash.

Ahead of an in Adriatic closing. Can you comment on this in the context of

the 4377 million cash component of the purchase price and the 200 million in closing costs and debt repayments and so on.

Navin Dyal: Hi, Don. It is not the restricted cash amount. It is actually just covering off the costs that will incur as a result of the transaction costs related to basically acquiring Adriatic. It also includes a very, very small amount for stamp duties as well as for certain transaction-related costs. So it does not cover the full debt repayments that otherwise we were contemplating or repaying certain of Adriatic's debt. That would just come out of our regular cash balance post-transaction, but we are required under the U.K. rules to set aside the cash component of the transaction, and that is what you are seeing there.

Uh that were in addition to that. Like so is that restricted cash amount enough?

Hi, Donna. Yeah, it's not the restricted. Cash amount is actually just covering off the, the costs that will incur as a result of the transaction costs, you know, related to, um, uh, the basically acquiring Adriatic, it also includes a very, very small amount for, uh, stamp duties, as well as for, um, certain transaction related costs. So it does not cover, uh, the full debt repayments that, uh, otherwise were contemplating for repaying, uh, certain of Adriatic debt. Um, now that would just come out of our regular cash balance posture.

Don Demarco: Okay, thank you. Then I will just shift over to Čoka Rakita project. So David, with the FS penny released in Q4, what are the next steps after that? Will this be followed by a go-forward decision? Do you expect to start spending CapEx Q4 or Q1 2026? If you could just remind us again in the context of Adriatic, is Čoka Rakita project internally funded, or would you look for potential external sources of funding to round that out?

Transaction. But we're required under the UK rules to set aside the cash component of the transaction, and that's what you're seeing there.

Okay, thank you.

Um, then I'll just shift over to Chaco rakita.

So, uh, David, with the FS pending release in Q4, what are the next steps after that? And will this be followed by a go-forward decision? Uh, do you expect to start spending CapEx?

24, or q1 2026. And if you could just remind us again, the context of Adriatic is is

David Rae: Okay, the next steps are that we are completing the feasibility. At the same time, we are working on a Serbian feasibility and additional step in addition to completing the certificate of resources and the exploitation permit. We anticipate an EIA, which is an application that goes in at the end of the year. That is the key thing. Once we are into the new year, we anticipate all of that completed in that construction decision at mid-year. So starting to build in the new year, some of the costs in terms of capital and loans by the fact we intend to reuse equipment from Ada Tepe mine, as you know. So a good amount of the service equipment from there.

Choker Rakita: Will that be internally funded, or would you look for potential external sources of funding to round that out?

Application that goes in, at the end of the year. That's the key thing. Then, once we're into the new year, we anticipate all of that completed in a construction decision at mid year. So, starting to build

Um, some of the costs in terms of capital are long-term.

David Rae: Other acquisitions, we can, I think we will talk about that more in due course, but I think the key thing at the moment is to see that we are on track, anticipate that we will basically get permission internally to start building and externally to start building, and that will start happening in Q3 next year.

That we intend to reuse equipment from. Um, add a te as, as, you know, so a good amount of assistance equipment from there. So, um, you know, other Acquisitions? We can, I think we'll talk about that more in due course, but I think the key thing with the moment is to see that we're on track anticipate that we'll uh, basically get permission

Navin Dyal: Yeah, and Don, we are very confident in our ability to fund Čoka Rakita internally as well as based on the cash flow and the capital requirements. So we will be focused on the ramp-up of theirs and ensuring Čoka Rakita remains on track.

Don Demarco: Okay, great. Thanks for that. David, I think you just mentioned the word acquisition. With Čoka Rakita project development about to commence, Adriatic ramping up subject to the deal closing, what has Dundee Precious Metals Inc.'s M&A priority and focus over the next year or so? Is it on the back burner for the time being, or is it, I think that's what you might have alluded to, but if you just clarify, thank you.

Internally to start building an external. We just start building and that'll start happening in Q3 next year. Yeah. And uh, yeah Don. Yeah. We we're, you know, very confident in our ability to fund, uh, joke for a kid internally, um, as well as our, you know, based on the cash flow and the capital requirements. So I will be focused on the ramp up of various and ensure and trucker remains on track.

Okay, great. Thanks for that and David. I think you, maybe you just mentioned the word acquisition, um,

you know, with that, um, you know, with choker rakita development about to combat Adriatic, ramping,

Ramping up subject to the deal closing. You know what, what is done to these? Um, m&a, priority and focus over the next year or so.

David Rae: Yeah, Don, I wasn't actually alluding to that. We've got a very exciting organic growth portfolio. That's what we had already with Čoka Rakita, potentially Timok gold project going forward, Loma Larga. On top of that, we've got the 4,400 hectares around Ada Tepe mine operations, plus some additional regional potential there. That's all pretty exciting for us. We do the same as we have done historically. We look for opportunities where there are assets which may create value within the company. I would say that's a little less of something that's on the front burner now, but it's something that we do consistently over time. If we find the right asset, we will consider that. Right now, I would say that we've managed to really change our outlook.

Is it on the back burner for the time being? Or is it? Uh, I think that's what you might have alluded to, but if you just clarify, thank you. Yeah. Donna wasn't actually alluding to that the, um, we got a very exciting organic growth portfolio. Uh, you know, that's what we have already with. Um,

Choco Wiki the potential to Mutual pots. Are going forward, low Malaga. And then on top of that, we've got The 4400 factors around barish operations, plus some additional sort of regional potential versus. So that's all pretty exciting for us. We, we do the same as we have done historically. We look for opportunities where there are assets, which may create value within the company.

I would say that's a little less of something that's on the front burner now but you know, it's something that we do consistently over time. If we find the right asset, we could consider that

but right now, I

David Rae: We've published information that shows that we're looking to be at 600,000 ounces gold equivalent by the end of, really by the time the Čoka Rakita project comes online. You've got an exit of 2028 going into 2029. That's without Loma Larga, which is another 175,000 ounces also per year over 10 years. That's a really exciting portfolio to have in front of us. I think the one thing that perhaps people don't realize is that it's carrying on at that same margin that we have from Chelopech mine and Ada Tepe mine, Čoka Rakita project at 644, Ada Tepe mine at just under 90, and so on.

Managed to really change our output. So we published information that shows that we were looking 600,000 Oz, gold equivalent by the end of

Quite well, it's really by the time the chocolate keeps, it comes online. So as you sort of exit, 28, going into 29.

And that's with that low, which is another 100 million 705,000 ounces or so per year over 10 years. So that's a really exciting portfolio to sort of have in front of us. And I think the one thing that perhaps people don't realize is that it's carrying on at that same margin that we have from Chop Champs, at a tier at $6,404.

Don Demarco: Yeah, certainly that's not lost on us. As a final question, will you be releasing three-year guidance as you have in, or three-year outlook as you have in the past? With the next update, we might see Adriatic perhaps if it's subject to deal closing and then might even catch a little bit of Čoka Rakita?

Yeah.

Yeah, certainly that's not lost on us. And so as a final question, will you be releasing 3 year guidance as you have or 3 year outlook as you have in the past? So

Navin Dyal: Absolutely, Don. The plan would be that if we see the position of Adriatic, we would release updated three-year outlook. To the extent that there is updated information around Loma Larga in terms of the technical report, as well as if the feasibility study has been complete for Čoka Rakita, we would certainly update that. Let's update that as well.

With the next update. We might see Adriatic. Perhaps if the subject to deal closing and then might even catch it. Catch a little bit of choker aita.

Don Demarco: Okay, thank you very much. That's all for me. Good luck with the rest of the quarter, guys.

Yeah, absolutely done. So the plan would be position of a periodic. We would release updated 3 route look. Um, and to the extent that there is updated information, uh, you know, around level Lara in terms of the technical report as well as if the feasibility study has been complete for. For example, we would certainly update that let's update that as well.

Okay, thank you very much. That's all for me, and good luck with the rest of the quarter, guys.

Operator: Thank you. I would now like to turn the call back over to Jennifer Cameron for any closing remarks.

Thanks.

Jennifer Cameron: Thanks everyone for joining us. If you have any further questions, please feel free to reach out. For those of us in Ontario, hope you guys have a safe and happy long weekend. We will talk to you next quarter. Thank you.

Thank you. I would now like to turn the call back over to Jennifer Cameron for any closing remarks.

Operator: Thank you. This concludes the conference. Thank you for your participation. You may now disconnect.

Well, thanks everyone for joining us. If you have any further questions, please feel free to reach out and for those of us in Ontario, hope you guys have a safe and and happy long weekend. We'll talk to you next quarter. Thank you.

Thank you, this concludes the conference. Thank you for your participation. You may now disconnect