Q2 2025 Heliostar Metals Ltd Earnings Call

Speaker #2: Good morning, everyone, and welcome to Heliostar's second quarter and quarterly update call. with me, I have on the call, CFO, Vitalina Lysoun, and our COO, Greg Bush.

Charles: Good morning, everyone, welcome to Heliostar's Q2 quarterly update call. With me I have on the call our CFO, Vitalina Lyssoun, and our COO, Gregg Bush. We'll be pleased today to run you through a update of our progress in the Q2 calendar quarter of the year, and then take any comments at the end of this presentation. I'll note that this is our Q1 fiscal quarter, given that we have a 31 March year-end and a Q2 calendar quarter for the year. The company intends to move our financial year-end to a calendar year-end, we aim to complete that at the end of this year to have an aligned fiscal and calendar year going forward.

Charles Funk: Good morning, everyone, and welcome to Heliostar Metals Ltd.'s second quarter and quarterly update call. With me, I have on the call our CFO, Vitalina Lo Soon, and our COO, Greg Bush. We'll be pleased today to run you through an update of our progress in the second calendar quarter of the year, and then take any comments at the end of this presentation. I'll note that this is our first fiscal quarter, and given that we have a March 31st year-end and a calendar second quarter for the year, the company intends to move our financial year-end to a calendar year-end, and we aim to complete that at the end of this year to have an aligned fiscal and calendar year going forward. As has been very clear from my perspective as a company, we have a very clear goal of what we want to achieve as a company.

Speaker #2: And we'll be pleased today to run you through an update of our progress in the second calendar quarter of the year. and then take any comments at the end of this presentation.

Speaker #2: I'll note that this is our first fiscal quarter and given that we have a March 31st year-end and a calendar second quarter for the year.

Speaker #2: The company intends to move our financial year-end to a calendar year-end, and we aim to complete that at the end of this year, to have an aligned fiscal and calendar year going forward.

Speaker #2: As has been very clear from my perspective as a company, we have a very clear goal of what we want to achieve as a company.

Charles: As been very clear from my perspective as a company, we have a very clear goal of what we want to achieve as a company. We want to build a mid-tier gold producer. We wanted to do that on the back of growing the assets that we have, and ultimately achieving 500,000 ounces a year at the end of the decade. I think we've made some significant progress on that path, which we'll look forward to presenting. I think I should comment that we will be making some forward-looking statements. You will be able to find this cautionary statement on the presentation on our website, and I encourage you to refer to that as we present our future plans for the company.

Speaker #2: We want to build a mid-tier gold producer. we wanted to do that on the back of growing the assets that we have, and ultimately achieving $500,000 a year at the end of the decade.

Charles Funk: We want to build a mid-tier gold producer. We wanted to do that on the back of growing the assets that we have, and ultimately achieving 500,000 ounces a year at the end of the decade. I think we've made some significant progress on that path, which we'll look forward to presenting. I should comment that we will be making some forward-looking statements. You will be able to find this cautionary statement on the presentation on our website, and I encourage you to refer to that as we present our future plans for the company. To start the quarter, I'd like to hand over to Vitalina Lo Soon to present the fiscal facts from the quarter for us.

Speaker #2: I think we've made some significant progress on that path, which we'll look forward to presenting. I think I should comment that we will be making some forward-looking statements.

Speaker #2: You will be able to find this cautionary statement on the presentation on our website. and I encourage you to refer to that as we present our future plans for the company.

Speaker #2: To start the quarter, I'd like to hand over to Vitalina Lysoun, to present the fiscal, facts from the quarter for us.

Charles: To start the quarter, I'd like to hand over to Vitalina Lyssoun to present the fiscal facts from the quarter for us.

Speaker #3: Thank you, Charles. Heliostar had another great quarter. We produced $73 million gold equivalent ounces in a period, and we had almost over 8,500 ounces sold.

Vitalina Lyssoun: Thank you, Charles. Heliostar had another great quarter. We produced 7,396 gold equivalent ounces in the period, and we had over 8,500 ounces sold of gold equivalent ounces. Our production continues to be from the Junkyard stockpile at La Colorada, as well as re-leaching at both La Colorada and San Agustin mines, and some marginally leaching from El Castillo as well. Our cash position was almost CAD 30 million at the end of the quarter, which increased from CAD 27 million at the end of the year. This is a reflection of our continued production and operations. We had inflows for both operations as well as some inflow from exercises of stock options and warrants. We continue to have no debt, and our working capital position improved significantly to almost CAD 52 million.

Vitalina Lo Soon: Thank you, Charles. Heliostar had another great quarter. We produced 73.96 gold equivalent ounces in a period, and we had over 8,500 ounces sold of gold equivalent ounces. Our production continues to be from the junkyard stockpile at La Clarada, as well as re-leaching at both La Clarada and San Agustin mines, and some immaterial re-leaching from El Castillo as well. Our cash position was almost $30 million at the end of the quarter, which increased from $27 million at the end of the year. This is a reflection of our continued production and operations. We had inflows for both operations, as well as some inflow from exercises of stock options and warrants. We continue to have no debt, and our working capital position has improved significantly to almost $52 million.

Speaker #3: of gold equivalent ounces, our production continues to be from the junkyard stockpile at La Colorada, as well as re-leaching at both La Colorada and Santa Cristina mines, and some immaterial re-leaching from El Castillo as well.

Speaker #3: Our cash position was almost 30 million at the end of the quarter, which increased from 27 million at the end of the year. And this is a reflection of our continued production and operations, so we had inflows for both operations as well as some inflow from exercises of stock options and warrants.

Speaker #3: We continue to have no debt, and our working capital position improved significantly to almost 52 million. Our cash costs of just over $1,400 per gold equivalent ounce sold, and ASIC of 1,541, were significantly below our guidance, and that's a combination of our guidance being fairly conservative, when we originally set it out, as well as production volumes and cost measures.

Vitalina Lyssoun: Our cash costs of just over CAD 1,400 for gold equivalent ounce sold at AISC of CAD 1,641 were significantly below our guidance. That's a combination of our guidance being fairly conservative when we originally set it out, as well as production volumes and cost measures. We've been able to reach an average sales price of CAD 3,281, which led us to a profit margin of CAD 741 per ounce or 113%. Next slide, please. On this slide, we can see a graph of the range of our actual costs to our guidance. We can see that our Q2 and our Q1 consolidated costs are significantly below our budget. We're at about CAD 1,500, which is well below our guidance of CAD 1,950 to CAD 2,100.

Vitalina Lo Soon: Our cash costs of just over $1,400 for gold equivalent ounce sold and AISC $1,541 were significantly below our guidance. That's a combination of our guidance being fairly conservative when we originally set it out, as well as production volumes and cost measures. We've been able to reach an average sales price of $3,281, which led us to a profit margin of $741 per ounce, or 113%. Next slide, please. On this slide, we can see a graph of the range of our actual costs to our guidance. We can see that our second annual quarter and our first fiscal quarter consolidated costs are significantly below our budget. We're at about $1,500, which is well below our guidance of $1,952. Each individual mine is also well below our guidance as well.

Speaker #3: We've been able to reach an average sales price of $32.81, which led us to a profit margin of $741 per ounce or 113%.

Speaker #3: Next slide, please. On this slide, we can see a graph of the range of our actual costs to our guidance, so we can see that quarter and our first fiscal quarter consolidated costs are significantly below our budget.

Speaker #3: We're at about 1,500, which is well below our guidance of $952.100. And each individual mine is also well below our guidance as well. We do expect the Santa Cristina costs to increase in Q4 of this year, upon restart of mining, and that's a reflection of the expected capital expenditures as well as pre-stripping costs.

Vitalina Lyssoun: Each individual mine is also well below our guidance as well. We do expect the San Agustin costs to increase in Q4 of this year upon restart of mining, and that's a reflection of the expected capital expenditures as well as pre-stripping costs. Even with those increased costs, which we expect to be about CAD 2,900 to 3,000, they will still be well below the gold price range that we expect for the rest of the year. Thank you.

Vitalina Lo Soon: We do expect the San Agustin costs to increase in Q4 of this year upon restart of mining, and that's a reflection of the expected capital expenditures, as well as pre-streaming costs. Even with those increased costs, which we expect to be about $2,900 to $3,000, they will still be well below the gold price range that we expect for the rest of the year. Thank you.

Speaker #3: Even with those increased costs, which we expect to be about $2,900 to $3,000, they will still be well below the gold price range that we expect for the rest of the year.

Speaker #3: Thank you.

Speaker #2: I'll now hand over to Greg to provide an operational update of each of the assets.

Charles: I'll now hand over to Gregg to provide an operational update of each of the assets.

Charles Funk: I'll now hand over to Greg Bush to provide an operational update of each of the assets.

Speaker #4: Okay. Good morning, everyone. can, yeah, so we have continuing to have, you know, better than expected production from, from, from both San Augustin and La Colorada.

Greg Bush: Good morning, everyone. We have continuing to have better than expected production from both San Agustin and La Clarada. We did have one lost mine incident at La Clarada during the quarter. On a more positive note, we received notification this week that La Clarada received a certification for the clean industry, which kind of puts you on a different, it puts you on a little bit different relationship with Profeta. Makes life a bit easier. That's been a long process. It's taken about two years to do all the certification process. We're continuing to process the material from what we call the junkyard stockpile. What we budgeted from that stockpile was a material that averaged about 0.2. Now, we're running a little bit lower grade than that year to date.

Gregg Bush: Good morning, everyone. Yeah. We have continuing to have, you know, better than expected production from both San Agustin and La Colorada. We did have one lost time incident at La Colorada during the quarter. On a more positive note, we received notification this week that La Colorada received the certification for the Clean Industry, which kind of puts you on a different, it puts you on a little bit different relationship with PROFEPA, makes life a bit easier. That's been a long process. It's taken about 2 years to do all the certification process.

Speaker #4: the, we did have one lost-time incident at, at La Colorada, during, during the quarter. on a, on a more positive note, we, we received notification this week that we, that, that La Colorada received a certification for, for, for the clean industry, which kind of puts you on a different, it puts you on, puts you on a little bit different relationship with BRFEPA.

Speaker #4: makes life a bit easier. so that's been a long process. It has taken about two years to, to do all the, to do all the certification process.

Gregg Bush: We're continuing to process the material from the, what we call the Junkyard stockpile. That stockpile, what we budgeted from that stockpile, was material that averaged about 0.2. You know, now we're running a little bit lower grade than that. Year to date. The reason is that there's a rind or there was a rind of lower grade material that we did not include in our resource estimate there. With the gold price where it is, we made the decision to go ahead and process that material rather than rehandle it. It's lower cost. The grade has actually been running a little higher than we had estimated.

Speaker #4: so we're, we're continuing to process the, the material, from the, from the, what we call the junkyard stockpile. that stockpile, what we, what we budgeted from that stockpile was material that averaged about 0.2, you know, and now we're running a little bit lower grade than that, year, year to date.

Speaker #4: And the reason is, is that there, there's a rind or there was, there was a rind of lower-grade material that we did not include in our, in our, resource estimate there.

Greg Bush: The reason is that there's a rind, or there was a rind of lower-grade material that we did not include in our resource estimate there. With the gold price where it is, we made the decision to go ahead and process that material rather than re-handle it at its lower cost. In the grade, it's actually been running a little higher than we had estimated. Year to date, we're running about 0.8 or 0.185 grade for that material. We're seeing the grade now. We're through all of that lower-grade material. We're seeing the grades start to trend up. We've got, I think we've put 3 million tons on the pad year to date. That's through the end of August, not through the end of Q2. We're right now projecting that we'll finish that. We'll finish up that material in early January.

Speaker #4: That, but with the gold, with the gold price where it is, we made the decision to, to go ahead and, and process that material rather than re-handle it at its lower cost.

Speaker #4: So in the grade is actually been running a little higher than, than we, than we had estimated. So, year to date, year to date, we're running about 0.8 or 0.185 grade for that material, and it's, we're seeing the grade now.

Gregg Bush: Year to date, we're running about 0.8 or 0.185 grade for that material. We're seeing the grade now. We're through all of that lower grade material. We're seeing the grades start to trend up. I think we've put 3 million tons on the pad year to date. That's through the end of August, not through the end of Q2. We're right now projecting that we'll finish that, we'll finish up that material in early January.

Speaker #4: We're, we're through all of that, all of that lower-grade material. so we're seeing the, we're seeing the grade start to trend up. so we've got, we've, I think we put three million tons on the pad year to date.

Speaker #4: That's through the end of August, not through the end of, of Q2. so we're right now projecting that we'll finish that, we'll, we'll finish up that material in early January.

Gregg Bush: I mean, so far we're expecting we'll exceed guidance at La Colorada, but not necessarily because of the junkyard, just because we've had better releaching results than we anticipated. The technical report at the Crestone pit is nearing completion. We expect to have that here in the next week or so. The Veta Madre permit, I think we don't know if our next, you know, our next material is gonna come from Veta Madre or if it'll come from this, the dump that we just started drilling here in the last couple of weeks.

Speaker #4: so so as we're, so, I mean, so far, I mean, we're, we're, we're expecting we'll exceed guidance at, at our guidance at La Colorada.

Greg Bush: So far, we're expecting we'll exceed guidance at our guidance at La Clarada, but not necessarily because of the junkyard, just because we've had better, we've had better re-leaching results than we anticipated. The technical report for the Crestone pit is nearing completion. We expect to have that here in the next week or so. The Veta Madre permit, I think we don't know if our next material is going to come from Veta Madre or if it'll come from the dump that we just started drilling here in the last couple of weeks. I think it'll depend on the timing of the permit, and it's going to depend on the grades we find when we drill off the El Dorado material. That permit is, we don't see any, we don't see any red flags at this point. We expect to have that permit by the end of the year.

Speaker #4: But not, but not necessarily because of the junkyard, it's because we've had, we've had better, we've, we've had better re-leaching results than we anticipated.

Speaker #4: The technical report for the Crestone Pit is nearing completion. We expect to have that here in the next week or so.

Speaker #4: And the Vetamadre permit, I think we, I, we don't know if our next, you know, our next material is going to come from Vetamadre or if it'll come from the dump that we just started drilling here in the last couple of weeks.

Gregg Bush: I think it'll depend on the timing of the permit, and it's gonna depend on the grades we find when we drill off the El Dorado material. But that permit. We don't see any red flags at this point. We expect to have that permit by the end of the year or, it's not really a permit, it's a land use change, by the end of the year or early 2026. Can we go to the next slide? San Agustin, we've also had, we've, you know, had better than expected production. Unfortunately, we also had a lost time incident at San Agustin in the quarter.

Speaker #4: it, I think it'll depend on the timing of the permit, and it's going to depend on the grades we find when we drill off the, the El Dorado, the El Dorado material.

Speaker #4: So, but that, that permit is, we don't see any, we don't see any red flags at this point. We expect to have that permit by the end of the year or, or, or so it's not really a permit.

Greg Bush: It's not really a permit. It's a land use change by the end of the year or early 2026. Can we go to the next slide? At San Agustin, we've also had better than expected production. Unfortunately, we also had a lost mine incident at La Clarada at San Agustin in the quarter. What our plan was at San Agustin, we had some material that we knew had not been leached well. We had a program to re-handle that material and add some lime to it. That was going to carry our production through the first quarter. We expected it to taper off really quick after that. We're still kind of learning how these heaps respond. I think in the first quarter, we got better results than we expected from re-handling that material. Following that, we've been aggressively going after the side slopes and things like that.

Speaker #4: It's a land-use change. by the end of the year or early 2026. so, can we go to the next slide? So San Augustin, we've also had, we, you know, had better than expected production.

Speaker #4: We had, unfortunately, we also had a lost-time incident at, at, at La, at San Augustin in, in, in the quarter. this, so I, what our plan, what our plan was at San Augustin, we, you know, had, had some material that we knew had not been had not been leached well, so we had a program to, to re-handle that material and, and, add some lime to it.

Gregg Bush: What our plan was at San Agustin, we, you know, had some material that we knew had not been leached well. We had a program to rehandle that material and add some lime to it. That was going to carry our production through Q1. We kind of expected it to taper off really quick after that. You know, as I said, we're still kind of learning how these heaps respond. I think in Q1, we got better results than we expected from rehandling that material. Following that, we've been, you know, kind of aggressively going after the side slopes and things like that.

Speaker #4: And that was going to carry our production through, through the first quarter. And, and then we expect that we, we kind of expected it to taper off really quick after that, but, you know, it's a, we're, we're still kind of learning how these, how, how these, how these heaps respond.

Speaker #4: So we got, I think in the, in the first quarter, we got better, we got better results than we expected from re-handling that material.

Speaker #4: and following that, we've, we've been, you know, kind of aggressively going after the side slopes and things like that. so we're continuing to, to, to make, you know, better than expected production.

Gregg Bush: We're continuing to make, you know, better than expected production. We had planned on having material from the corner expansion of the pit going on the pad by, you know, by September. We don't really expect to see production before November. It's gonna be, you know, you know, just starting then. The corner is, you know, there's 44,000 ounces of recoverable gold that we expect to get from the corner. There are a number of small expansion opportunities around the perimeter of the pit that is, you know, that we'll be starting drilling, trying to drill those off.

Greg Bush: We're continuing to make better than expected production. We had planned on having material from the corner, expansion of the pit going on the pad by September. We're not going to make that, but we don't really expect to see production before November. It's going to be just starting then. The corner is, notes there, there's 44,000 ounces of recoverable gold that we expect to get from the corner. There are a number of small expansion opportunities around the perimeter of the pit that we'll be starting drilling, trying to drill those off. Hopefully before we finish the corner, if there is an expansion opportunity there, we can just transition right into that. That's kind of the production update I've got. I'll hand it back over to Charles. Thank you.

Speaker #4: we, we had planned on, on having material from, from the, the, the corner, expansion of the pit going on the pad by, you know, by, by September.

Speaker #4: We're not going to make that. We, but we, we think we'll, we'll have, we, we don't really expect to see production before November. It's going to be, you know, you know, just, just starting then.

Speaker #4: so the, the corner is, they'll say there's 44, 44,000 ounces. recoverable gold that we expect to get from the corner. We, there, there are a number, there are a number of small expansion opportunities around the, around the perimeter of the pit that it's, you know, that we'll, we'll be starting, we'll be starting drilling trying to drill those off.

Speaker #4: so, you know, so hopefully before we finish the, the corner, if there, if, if there is an expansion opportunity there, we can just transition right into that.

Gregg Bush: You know, hopefully before we finish the corner, if there is an expansion opportunity there, we can just transition right into that. That's kind of the production update I've got. I'll hand it back over to Charles. Thank you.

Speaker #4: so that's, that, that's kind of the production update I've got, so. I'll hand it back over to Charles. Thank you.

Speaker #2: Perfect. Thank you very much, Greg.

Charles: Perfect. Thank you very much, Greg. I think as we'd forecast, we had these different trajectories of the assets. We had the ramp up of La Colorada, and we had the draw down of the leach pad capacity out of, sorry, of the residual gold on the leach pad at San Agustin. We anticipated and we forecast that Q2 would have been our weakest quarter of the year. I think they're strong results for the quarter in that context. As Greg referred to San Agustin and didn't draw down as quickly as we thought it might. La Colorada has really hit its straps, particularly as we moved and stacked material from lower on the leach pad to higher on the leach pad. We finally saw that wave front come through and start to deliver gold from mid-July onwards.

Charles Funk: Perfect. Thank you very much, Greg. I think as we'd forecast, we had these different trajectories of the assets. We had the ramp-up of La Clarada, and we had the drawdown of the leach pad capacity, sorry, of the residual gold on the leach pad at San Agustin. We anticipated and we forecast that the second quarter would have been our weakest quarter of the year. I think they're strong results for the quarter in that context. As Greg referred to, San Agustin didn't draw down as quickly as we thought it might. La Clarada has really hit its straps, particularly as we moved and stacked material from lower on the leach pad to higher on the leach pad. We're saying we finally saw that wavefront come through and start to deliver gold from mid-July onwards.

Speaker #5: I think as we'd forecast, we had these different trajectories of the assets. We had the ramp-up of La Colorada, and we had the draw-down of the leach-pad capacity out of, sorry, of the residual gold and the leach-pad at San Augustin.

Speaker #5: We anticipated and we forecast that the second quarter would have been our weakest quarter of the year. I think they're strong results for the quarter.

Speaker #5: In that context, as Greg referred to, San Augustin didn't draw down as quickly as we thought it might. La Colorada has really hit its straps, particularly as we moved and stacked, material from Laura and the leach-pad to higher on the leach-pad.

Speaker #5: we're see we finally saw that wavefront come through and start to deliver gold from mid-July onwards. So I think we have a stronger Q3 and Q4 ahead of us.

Charles: I think we have a stronger Q3 and Q4 ahead of us from the Q2. I think despite that, the fact that we were able to generate the CAD 14 million from the operating mines, that we're able to add cash to our balance sheet sets us up really well. As Gregg Bush was referring to, the restarting of mining at San Agustin in Q4 is gonna be a big step for us. As such, we've reiterated our production guidance. I think we'll be in the low to mid end of our production guidance range, depending on how quickly we do get San Agustin restart underway.

Charles Funk: I think we have a stronger Q3 and Q4 ahead of us, from the second quarter. I think despite that, the fact that we were able to generate the $40 million from the operating mines, that we're able to add cash to our balance sheet sets us up really well. As Greg was referring to, the restarting of mining at San Agustin in Q4 is going to be a big step for us. As such, we've reiterated our production guidance. I think we'll be in the low to mid-end of our production guidance range, depending on how quickly we do get San Agustin restart underway. The slight delay in what was a budgeted restart of San Agustin has been offset by that stronger performance that Greg was referring to. We expect that we'll be at the bottom end, maybe below our AISC range and cash cost range as Vitalina forecast.

Speaker #5: From the second quarter, I think despite that, the fact that we were able to generate $14 million from the operating mines and that we're able to add cash to our balance sheet sets us up really well.

Speaker #5: And then, as Greg was referring to, the restarting of mining at San Augustin in Q4 is going to be a big step for us.

Speaker #5: As such, we've reiterated our production guidance. I think we'll be in the low to mid-end of our production guidance range depending on how quickly we do get, San Augustin restart underway.

Speaker #5: the slight delay in what was the budgeted, restart of San Augustin has been offset by that stronger performance that Greg was referring to. and we expect that will be at the bottom end, maybe below, ASIC, a range and cash cost range as Vitalina forecast.

Charles: The slight delay in what was a budgeted restart of San Agustin has been offset by that stronger performance that Gregg Bush was referring to. We expect that will be at the bottom end, maybe below AISC range and cash cost range as Vitalina Lyssoun forecast. That's a function that we took over these assets on 8 November. We put out the guidance in the beginning of January. I think it might look in hindsight that we were a touch conservative on our cash cost guidance. We'd much rather be that than the other way. I think the key takeaway is these are very profitable assets. These are incredibly strong margins for us to have as a company. It's adding cash to our balance sheet. Our intention is to deploy that on our growth pipeline.

Speaker #5: that's a function that we took over these assets on November 8th. We put out the guidance in the beginning of January. I think it might look in hindsight that we're a touch conservative on our cash cost guidance, but we'd much rather be that than the other way.

Charles Funk: That's a function that we took over these assets on November 8th. We put out the guidance in the beginning of January. I think it might look in hindsight that we're a touch conservative on our cash cost guidance, but we'd much rather be that than the other way. I think the key takeaway is these are very profitable assets. These are incredibly strong margins for us to have as a company. It's adding cash to our balance sheet, and our intention is to deploy that on our growth pipeline. It's been a very busy quarter, that's going to lead into an even busier back end of the year in terms of material development. We've got La Clarada up and running steady state.

Speaker #5: I think the key takeaway is that these are very profitable assets. These have incredibly strong margins for us as a company. It's adding cash to our balance sheet, and our intention is to deploy that into our growth pipeline.

Speaker #5: it's been a very busy quarter. that's going to lead into an even busier back end of the year, in terms of material development. So, we've got La Colorada up and running steady state, as Greg mentioned, the intention is to focus on the junkyard this year.

Charles: It's been a very busy quarter, that's gonna lead into an even busier back end of the year in terms of material development. We've got La Colorada up and running steady state. As Gregg mentioned, the intention is to focus on the Junkyard this year, likely move to the El Dorado and Truck Shop stockpiles next year, and Veta Madre behind that once we receive that permit late this year, early next year. You'll see an updated technical report very shortly from La Colorada. We're a little delayed on that. I'm waiting for some additional geotechnical work that's been underway that took a bit longer than we forecast. We think that can potentially further improve the economics of the mine life that we have at La Colorada.

Charles Funk: As Greg mentioned, the intention is to focus on the junkyard this year, likely move to the El Dorado and truck shop stockpiles next year, and Veta Madre behind that once we receive that permit late this year, early next year. You'll see an updated technical report very shortly from La Clarada. We're a little delayed on that, waiting for some additional geotechnical work that's been underway that took a bit longer than we forecast. We think that can potentially further improve the economics of the mine life that we have at La Clarada. I think that's going to come from two things.

Speaker #5: Likely, move to the El Dorado and truck shop stockpiles next year, and Vetamadre behind that once we receive that permit late this year, early next, late this year, early next year.

Speaker #5: You'll see an updated technical report very shortly from La Colorada. We're a little delayed on that, waiting for some additional geotechnical work, and that's been underway.

Speaker #5: That took a bit longer than we forecast. and we think that can potentially further improve the economics of the, the, the mine life that we have at La Colorada.

Speaker #5: I think that's going to come from two things. It's going to come from additional resources and reserves that we discovered with the drill program that we completed earlier in the year.

Charles: I think that's going to come from 2 things. It's going to come from additional resources and reserves that we discovered with the drill program that we completed earlier in the year. Secondly, finding some of those ounces more shallowly, means areas that were soon to be waste in the pit are going to be modified to containing all great mineralization. Look for that study very shortly. We think that's going to have a very positive impact of the economics. When you see it, note that it doesn't include the Truck Shop or the El Dorado stockpile. Think of that as a potential funding mechanism for part or all of the capital for those pits when you see that technical report come out.

Charles Funk: It's going to come from additional resources and reserves that we discovered with the drill program that we completed earlier in the year, and secondly, finding some of those ounces more shallowly means areas that were assumed to be waste in the pit are going to be modified to containing ore grade mineralization. Look for that study very shortly. We think that's going to have a very positive impact on the economics. When you see it, note that it doesn't include the truck shop or the El Dorado stockpile. Think of that as a potential funding mechanism for part or all of the capital for those pits when you see that technical report come out.

Speaker #5: And secondly, finding some of those ounces more shallowly means areas that were soon to be waste in the pit are going to be modified to contain all-grade mineralization.

Speaker #5: So, look for that study very shortly. We think that's going to have a very positive impact of the economics. And when you see it, note that it doesn't include the truck shop or the El Dorado stockpile.

Speaker #5: So, think of that as a potential funding mechanism for part or all of the capital for those pits when you see that technical report come out.

Speaker #5: At San Augustin, Greg covered it well. focused on the restart of the corner. and then looking to do both oxide expansion and then some very interesting exploration sulfide targets that we laid out in a press release in July.

Charles Funk: At San Agustin, Greg covered it well, focused on the restart of the corner, and then looking to do both oxide expansion and then some very interesting exploration sulfide targets that we laid out in a press release in July. I'm very proud to have received all the permissions and permits and then internally to have made that restart decision. It's transformative. At the study itself, gold price levels, it produces about $40 million in cash flow for us, significantly more in the current gold price environment. We think La Clarada and San Agustin can generate well over $100 million in free cash flow from mid this year to mid 2027. The intention is to use that to unlock our growth projects and to try and do that with little to no equity dilution. As part of that, there's a continued ramp-up of our Anapola project.

Charles: At San Agustin, and Gregg covered it well, focused on the restart of the corner, and then looking to do both oxide expansion and then some very interesting exploration sulfide targets that we laid out in a press release in July. You know, I'm very proud to have received all the permissions, permits, and then internally to have made that restart decision. It's transformative, at the study itself, gold price levels. It produces about CAD 40 million in cash flow for us, significantly more in the current gold price environment.

Speaker #5: I'm very proud to have received all the permissions, permits, and then internally to have made that restart decision. it's transformative. at, at the study itself, gold price levels, it produces about $40 million in cash flow for us.

Speaker #5: Significantly more in the current gold price environment. We think La Colorada and San Augustin can generate well over $100 million in free cash flow from mid this year to mid 2027.

Charles: We think La Colorada and San Agustin can generate well over CAD 100 million in free cash flow from mid-2024 to mid-2027, the intention is to use that to unlock our growth projects and to try and do that with little to no equity dilution. As part of that, there's a continued ramp-up of our Annapurna project. The feasibility study's in progress. We've got a 15,000 m drill program that is in all likelihood going to expand in H2 underway. We've committed to CAD 9.5 million of expenditure this year at Annapurna, focused on the feasibility study and converting inferred resources to measured and indicated so that they can go into the reserve. If we're fortunate, potential reserve growth as well.

Speaker #5: And the intention is to use that to unlock our growth projects and to try and do that with little to no equity dilution.

Speaker #5: As part of that, there's a continued ramp-up of our Annapola project. The feasibility studies are in progress. We've got a $15,000-meter drill program that is in all likelihood going to expand in the second half of the year and is underway.

Charles Funk: The feasibility study is in progress. We've got a 15,000-meter drill program that is in all likelihood going to expand in the second half of the year underway. We've committed to $9.5 million of expenditure this year at Anapola, focused on the feasibility study and converting inferred resources to measured and indicated so that they can go into the reserve. If we're fortunate, potential reserve growth as well. Anapola, we will see more and more focus on in the back half of the year as we look to develop that feasibility study in 2026. Beyond that, I think of the next projects, it's also worth mentioning that we'll have our first study out of Serra de Gaia in the second half of the year, update the existing pre-feasibility study. We've treated Serra de Gaia as historic to date. The only reason we've done it is bandwidth.

Speaker #5: We've committed to nine and a half million dollars of expenditure this year at Annapola focused on the feasibility study and converting inferred resources to measured and indicated so that they can go into the reserve.

Speaker #5: And if we're fortunate, potential reserve growth as well. So, Annapola, you'll see more and more focus on in the back half of the year as we look to develop that feasibility study in 2026.

Charles: Annapurna, you'll see more and more focus on in the H2 of the year as we look to develop that feasibility study in 2026. Beyond that, I think of the next projects, it's also worth mentioning that we'll have our first study out of Cerro de Gallo in the H2 of the year, update the existing pre-feasibility study. We've treated Cerro de Gallo as historic to date. The only reason we've done it is bandwidth. We didn't have enough capacity to do updated technical reports on all our operating assets and Cerro de Gallo, so we staged that later. We think there's not a lot of value for that in Heliostar today in the market, and we think it's a very attractive growth opportunity beyond Annapurna.

Speaker #5: Beyond that, I think at the next projects, it's also worth mentioning that we'll have our first study out of Saratogaia in the second half of the year.

Speaker #5: Update the existing pre-feasibility study. We've treated Saratogaia as historic. To date, the only reason we've done this is bandwidth; we didn't have enough capacity to do updated technical reports on all our operating assets and Saratogaia.

Charles Funk: We didn't have enough capacity to do updated technical reports on all our operating assets and Serra de Gaia, so we staged that later. We think there's not a lot of value for that in Heliostar Metals Ltd. today in the market, and we think it's a very attractive growth opportunity beyond Anapola. If we look back on Q2, significant optimization of our assets, bedding them down to sort of more steady-state performance, some significant milestones with the ability to restart San Agustin, and now pivoting towards what that looks like for our future growth profile, particularly with Anapola and Serra de Gaia. What that means in terms of deliverables for us going forward, I like to break down our deliverables on three levels. Our financial performance is kind of our base, demonstrating that we have positive cash flow assets.

Speaker #5: So, we staged that later. We think there's not a lot of value for that in Heliostar today in the market, and we think it's a very attractive growth opportunity beyond Annapola.

Speaker #5: So, I think if we look back on Q2, significant optimization of our assets, betting them down to sort of more steady state performance. some significant milestones with the ability to restart San Augustin.

Charles: I think if we look back on Q2, significant optimization of our assets, bedding them down to sort of more steady state performance, some significant milestones with the ability to restart San Agustin and now pivoting towards what that looks like for our future growth profile, particularly with Annapurna and Cerro de Gallo. What that means in terms of deliverables for us going forward, I like to break down our deliverables on 3 levels. Our financial performance is kind of our base, demonstrating that we have positive cash flow assets. You know, 30,000 to 40,000 ounces isn't a huge amount of production, but it is a significant amount of free cash flow for us to unlock our business.

Speaker #5: And now pivoting towards what that looks like for our future growth profile, particularly with Annapola and Saratogaia. And then what that means in terms of deliverables for us going forward.

Speaker #5: I like to break down our deliverables on three levels. Our financial performance is kind of our base, demonstrating that we have positive cash flow assets.

Speaker #5: you know, 30 to 40 thousand ounces isn't a huge amount of production, but it is a significant amount of free cash flow for us to unlock our business.

Charles Funk: You know, 30,000 to 40,000 ounces isn't a huge amount of production, but it is a significant amount of free cash flow for us to unlock our business. We think there's potential to expand that next year. We look forward to putting drilling off the El Dorado stockpile and then being able to complete what we believe our 2026 guidance to be. I expect it to be higher, in the range of 50,000 ounces plus next year if we're successful with our programs. The next layer is what I think is the big net asset value growth steps, showing the value of our projects, showing the updated technical study of La Clarada that's imminent, showing the PFS for Serra de Gaia, and then next year working on the feasibility study for Anapola.

Speaker #5: We think there's potential to expand that next year. So, we look forward to drilling off the El Dorado stockpile and then being able to complete what we believe our 2026 guidance to be.

Charles: We think there's potential to expand that next year, so we look forward to drilling off the El Dorado stockpile and then being able to complete what we believe our 2026 guidance to be. I expect it to be higher in the range of 50,000 ounces plus next year if we're successful with our programs. The next layer is what I think is the big, you know, net asset value growth steps, is showing the value of our projects, showing the updated technical study of La Colorada, that's imminent, showing the PFS for Cerro de Gallo, and then next year, working on the feasibility study for Annapurna. I think they're big value steps that can change a Heliostar share price as people see the value of our, of our assets. Lastly, it's these large drill programs that we have underway.

Speaker #5: I expect it to be higher, in the range of $50,000 ounces plus next year if we're successful with our programs. Then the next layer is what I think is the big, you know, net asset value growth steps is showing the value of our projects, showing the updated technical study of La Colorada.

Speaker #5: That's imminent, showing the PFS for Saratogaia, and then next year working on the feasibility study for Annapola. I think they're big value steps that can change Heliostar's share price as people see the value of our, of our assets.

Charles Funk: I think they're big value steps that can change Heliostar Metals Ltd.'s share price as people see the value of our assets. Lastly, it's these large drill programs that we have underway. We're going to drill 40,000 to 50,000 metres of drilling from November to the end of this year. It's more drilling than we've done in the entire company's history all in one year. It's going to end up being close to 20,000 metres at La Clarada. It's going to be 10,000 to 15,000 meters at San Agustin, and it's going to be over 15,000 meters at Anapola. We put out the first of those conversion results from Anapola in late August. Expect those to come with significant regularity. Expect the El Dorado stockpile results to come out. In Q4, start to expect some San Agustin oxide results.

Speaker #5: And then lastly, it's these large drill programs that we have underway. You know, we're going to drill 40 to 50,000 meters of drilling from November to the end of this year.

Charles: You know, we are going to drill 40,000 to 50,000 meters of drilling from November to the end of this year. It is more drilling than we have done in the entire company's history, all in one year. It is, you know, going to end up being close to 20,000 meters at La Colorada. It is going to be 10,000 to 15,000 meters at San Agustin, and it is going to be over 15,000 meters at Annapurna. We put out the first of those conversion results from Annapurna in late August. Expect those to come with significant regularity. Expect the El Dorado stockpile results to come out. In Q4, start to expect some San Agustin oxide results. We have kind of got this base level of the profitability of the business and the cash generation in the business.

Speaker #5: It's more drilling than we've done in the entire company's history all in one year. It's, you know, going to end up being close to $20,000 meters at La Colorada.

Speaker #5: It's going to be 10,000 to 15,000 meters at San Augustin, and it's going to be over 15,000 meters at Annapola. We put out the first of those conversion results from Annapola in late August.

Speaker #5: Expect those to come with significant regularity, expect the El Dorado stockpile results to come out, then in Q4 start to expect some San Augustin oxide results.

Speaker #5: So, we've kind of got this base level of the profitability of the business and the cash generation in the business. We've got these large projects that we're delivering, and then we have a lot of potential with our open resources and exploration upside.

Charles Funk: We've kind of got this base level of the profitability of the business and the cash generation in the business. We've got these large projects that we're delivering, and we have a lot of potential with our open resources and exploration upside. That should lead to fairly consistent news flow in Q3 and Q4, as you can see here. My last observation before we open it up to take any questions, please. I note that there is a Q&A button, so please type in any questions that you have for us, and we'll attempt to answer. This is a slide we're working on for those who follow the industry very closely. There are two large conferences coming up, one called Beaver Creek, the other the Denver Gold Forum that we'll be attending.

Charles: We've got these large projects that we're delivering, and then we have a lot of potential with our open resources and exploration upside. That should lead to fairly consistent news flow in Q3 and Q4, as you can see here. My last observation before we open it up to take any questions, please, and I note that there is a Q&A button, so please type in any questions that you have for us and we'll attempt to answer. This is a slide we're working on for those who follow the industry very closely. There's two large conferences coming up, one called Beaver Creek, the other the Denver Gold Forum, that we'll be attending. I thought it was a really useful example on the back of our second quarter to show the margin expansion that's underway for gold producers.

Speaker #5: And so, that should lead to fairly consistent news flow in Q3 and Q4, as you can see here. And then, my last observation, before we open it up to take any questions, please.

Speaker #5: And I note that there is a Q&A button, so please, for typing any questions that you have for us, and we'll attempt to answer.

Speaker #5: But this is a slide we're working on for those who follow the industry very closely. There are two large conferences coming up, one called Beaver Creek and the other the Denver Gold Forum, that we will be attending.

Speaker #5: And I thought it was a really useful example on the back of our second quarter. to show the margin expansion that's in underway for gold producers.

Charles Funk: I thought it was a really useful example on the back of our second quarter to show the margin expansion that's underway for gold producers. For us, it's using the history of La Clarada here, as you can see. In blue on the bar chart, you're seeing the cost to produce each ounce of gold. In green, you're seeing the sale price of those golds year in, year out. What you can see from 2014 all the way up to 2023 is a relatively consistent $200 to $400 margin, which I think has been a fair view of the margin history from when I came into the industry in 2005. That's around the margin that you saw. What we're seeing now is a historic divergence between the gold price and the cost of producing gold.

Speaker #5: For us, it's using the history of La Colorada here, as you can see. So, in blue on the bar chart you're seeing the cost to produce each ounce of gold.

Charles: For us, it's using the history of La Colorada here, as you can see. In blue on the bar chart, you're seeing the cost to produce each ounce of gold, and then in green, you're seeing the sale price of those golds year in, year out. What you can see from 2014, all the way up to sort of 2023, is a relatively consistent $200 to 400 dollar margin, which I think has been a fair view of the margin history, from when I came into the industry in 2005. That's around the margin that you saw. What we're seeing now, though, is a historic divergence between the gold price and the cost of producing gold. I think you're seeing it across the industry.

Speaker #5: And then in green, you're seeing the sale price of those golds year in, year out. What you can see from 2014 all the way up to sort of 2023 is a relatively consistent $200 to $400 margin, which I think is a beneficial view of the margin history from when I came into the industry in 2005.

Speaker #5: That's around the margin that you saw. What we're seeing now, though, is a historic divergence between the gold price and the cost of producing gold.

Speaker #5: I think we're seeing it across the industry. I think it's very well illustrated at our La Colorada mine. Never in history has gold been worth more per ounce relative to the cost to produce it at La Colorada.

Charles Funk: I think you're seeing it across the industry, and I think it's very well illustrated on our La Clarada mine. Never in history has gold been worth more per ounce relative to the cost to produce it at La Clarada, and I think that's a reflection across the industry. My thought there is, you know, this is why I think people should be investing in gold producers at the moment. That margin expansion does significant things for our cash flow generation, as Q2 shows. I think maybe if I'm a little more promotional, I think if you're attracted to buying gold producers, buying a growing gold producer, I think it's an incredible opportunity in this environment. That's what we seek to deliver, more ounces to deliver into this historic margin expansion. With that in mind, I'm going to open it up. Please type your questions.

Charles: I think it's very well illustrated on our La Colorada mine. Never in history has gold been worth more per ounce relative to the cost to produce it at La Colorada, and I think that's a reflection across the industry. My thought there is, you know, this is why I think people should be investing in gold producers at the moment. That margin expansion does significant things for our cash flow generation, as Q2 shows. I think maybe if I, if I'm a little more promotional, I think if then you're attracted to buying gold producers, buying a growing gold producer, I think it's an incredible opportunity in this environment, and that's what we seek to deliver more ounces to deliver into this historic margin expansion. With that in mind, I'm gonna open it up. Please type your questions.

Speaker #5: And I think that's a reflection across the industry. My thought there is, you know, this is why I think people should be investing in gold producers at the moment.

Speaker #5: That margin expansion does significant things for our cash flow generation, as Q2 shows. And I think maybe if I’m a little more promotional, I think that if you’re attracted to buying gold producers, buying a growing gold producer, I think it’s an incredible opportunity in this environment.

Speaker #5: And that's what we seek to deliver more ounces to deliver into this historic margin expansion. With that in mind, I'm going to open it up.

Speaker #5: Please type your questions. Please direct them to myself, Vitalina, or Greg, and we look forward to answering any questions we can over the next 20 minutes for a Q&A.

Charles Funk: Please direct them to myself and Vitalina or Greg, and we look forward to answering any questions we can over the next 20 minutes for a Q&A. Excuse me while I stop sharing my screen and we can open up the Q&A. The first one, thanks everyone and congratulations on the quarter. When do you expect the pre-stripping to start at Veta Madre, assuming you receive the updated permit? There's a couple of questions here, so I'll answer the first one. We anticipate getting that permit late this year or early next year. We would then start stripping Veta Madre beyond that. You'll see in the updated technical report, it's about a six to eight-month pre-strip. Our intention is to be mining the El Dorado stockpile in that time and using the cash flow from the El Dorado stockpile to fund that strip next year.

Charles: Please direct them to myself, Vitalina or Gregg, we look forward to answering any questions we can over the next 20 minutes for a Q&A. Excuse me while I stop sharing my screen. We can open up the Q&A. The first one, thanks everyone. Congratulations on the quarter. When do you accept the pre-stripping to start at Veta Madre, assuming you say receive the updated permit? There's a couple of questions here, I'll answer the first one. We anticipate getting that permit late this year, early next year. We would start stripping Veta Madre beyond that. You'll see in the updated technical report, it's about a 6 to 8-month pre-strip.

Speaker #5: Excuse me, why I stopped sharing my screen. And we can open up the Q&A. so the first one, thanks everyone on a congratulations on the quarter.

Speaker #5: When do you accept the pre-stripping to start at Vetamadre, assuming you see it receive the updated permit? There's a couple of questions here, so I'll answer the first one.

Speaker #5: We anticipate getting that permit late this year, early next year. We would then start stripping Vetamadre beyond that. you'll see in the updated technical report, it's about a six to eight-month pre-strip.

Speaker #5: Our intention is to be mining the El Dorado stockpile in that time and using the cash flow from the El Dorado stockpile to fund that strip next year.

Charles: Our intention is to be mining the El Dorado stockpile in that time and using the cash flow from the El Dorado stockpile to fund that strip next year. If you break it down really simply, look at Junkyard stockpile this year, El Dorado and Truck Shop next year, Veta Madre the year after. For simple views of where the majority of the gold is likely to come from at La Colorada. Gregg, I've got a question to you. Can you comment on the OPEX per ton cost for Junkyard year to date, and do you anticipate that they'll stay constant for the remainder of the year and for future stockpiles?

Speaker #5: So, if you break it down really simply, look at junkyard stockpile this year, El Dorado and truck shop next year, Vetamadre the year after.

Charles Funk: If you break it down really simply, look at junkyard stockpile this year, El Dorado and truck shop next year, Veta Madre the year after for simple views of where the majority of the gold is likely to come from at La Clarada. Greg, I've got a question to you. Can you comment on the OpEx per tonne cost for junkyard year to date, and do you anticipate that they'll stay constant for the remainder of the year and for future stockpiles?

Speaker #5: And for simple views of where the majority of the gold is likely to come from at La Colorada. Greg, I’ve got a question for you.

Speaker #5: can you comment on the OPEX per ton cost for junkyard year to date? And do you anticipate that they'll stay constant for the remainder of the year and for future stockpiles?

Gregg Bush: Yeah. Yeah. Year, year to date, we're on just under seven, you know, 750 per ton at La Colorada. That's including the, you know, the rehandle, or the mining costs for the stockpile plus all the processing. That's probably five, you know, 5%, 6% below what we had projected when we budgeted. We do expect that to stay in that range for the remainder of the year.

Speaker #4: yeah. yeah, we're so, so year, year to date, we're, it we're, we're und just und just under seven, you know, 750 per ton. at, at La Colorada, that's included that's including the, the, you know, the re-handle, the or the mining costs for the stockpile plus all the processing.

Greg Bush: Yeah. Yeah. Year to date, we're just under $7.50 per tonne at La Clarada. That's including the re-handle or the mining costs for the stockpile plus all the processing. That's probably 5%, you know, 5%, 6% below what we had projected when we budgeted. We do expect that to stay in that range for the remainder of the year.

Speaker #4: That's probably five, you know, five to six percent below what we had projected when we budgeted. We do expect that to stay in that range for the remainder of the year.

Speaker #2: Thank you. Another question is, do you expect the majority of the San Augustin restart CAPEX to be spent in Q3 or Q4? Or do you have a split between the two?

Charles: Thank you. Another question is, do you expect the majority of the San Agustin restart CapEx to be spent in Q3 or Q4, or do you have a split between the two?

Charles Funk: Thank you. Another question is, do you expect the majority of the San Agustin restart CapEx to be spent in Q3 or Q4, or do you have a split between the two?

Speaker #4: You want me to respond to that, Charles?

Greg Bush: You want me to respond to that, Charles?

Gregg Bush: You want me to respond to that, Charles?

Speaker #2: Yes, please.

Charles: Yes, please.

Charles Funk: Yes, please.

Speaker #4: Yeah. Yeah, I think that they won't all be spent in, in, and certainly in, in, in Q3, but I would expect to see, you know, the bulk of it, you know, say 75, 80 percent of it's going to be, going to be spent upfront.

Gregg Bush: Yeah. Yeah, I think they won't all be spent in, certainly in, in Q3. I would expect to see, you know, the bulk of it, you know, say 75%, 80% of it's gonna be, gonna be spent up front. There's a few projects that we need in the longer term there that, but we don't need them to start. It could, some of it could trail over, you know, into Q4 or even into early 2026.

Greg Bush: Yeah. I think they won't all be spent, certainly in Q3, but I would expect to see the bulk of it, you know, say 75%, 80% of it's going to be spent upfront. There's some projects, a few projects that we need in the longer term there, but we don't need them to start. Some of it could trail over into Q4 or even into early 2026.

Speaker #4: There's some pro there, there's a few projects that we need in, in the longer term there that, but, but we don't need them to start.

Speaker #4: So it could, some of it could trail over, you know, into, into Q4 or even into early, early, '26.

Speaker #2: Perfect. Thank you. No, I think, you know, we've, we've got a, in the technical report, we have a 4.2 million CAPEX for the restart of San Augustin.

Charles: Perfect. Thank you. No, I think, you know, we've got in the technical report, we have a CAD 4.2 million CapEx for the restart of San Agustin. Given the, where we'll be stacking ore on the leach pad and the timing, I think we can expect that to move closer to CAD 6 million, that's within our budget and within our guidance range. There's no change in what we model. Internally, we just had some higher costs, just given the timing than was originally envisaged in the tech report when it was published in January. Another question. Gregg, you're at La Colorada right now, I think you can answer this one very well. Has the recent rains had an impact on production?

Charles Funk: Perfect. Thank you. I think, you know, in the technical report, we have a $4.2 million CapEx for the restart of San Agustin. Given where we'll be stacking ore on the leach pad and the timing, I think we can expect that to move closer to $6 million, but that's within our budget and within our guidance range. There's no change in what we model. Internally, we just had some higher costs given the timing than was originally envisaged in the technical report when it was published in January. Another question. Greg, you're at La Clarada right now, so I think you can answer this one very well. Has the recent rains had an impact on production?

Speaker #2: Given where we'll be stacking ore on the leach pad and the timing, I think we can expect that to move closer to $6 million, but that's within our budget and within our guidance range.

Speaker #2: So there's no change in what we model internally. We just had some higher costs, given the timing that was originally envisaged in the tech report when it was published in January.

Speaker #2: another question, Greg, you're at La Colorada right now. So I think you can answer this one very well. has the recent rains had an impact on production?

Gregg Bush: Sadly, no. The rain seems to be largely going around La Colorada, although the system that's coming on shore right now gonna come right over us. It, no, it has not affected the production.

Speaker #4: sadly, sadly no. It's, the, the, the rain seems to be largely going around La Colorada, although the, the system is coming on shore right now in, going to, going to come right over us.

Greg Bush: Sadly, no. The rain seems to be largely going around La Clarada, although the system that's coming on shore right now in Baja is going to come right over us. No, it has not affected the production.

Speaker #4: But it, no, it has not affected the production.

Speaker #2: Yeah, I think what we're looking for, given that northern Mexico as a whole is in relative drought conditions, is that the whole of northern Mexico would love to see some proper rains.

Charles Funk: Yeah, I think what we're looking for, given that northern Mexico as a whole is in relative drought conditions, I think the whole northern Mexico would love to see some proper rains. Hopefully, we do see some of those hurricanes blow on without their intensity and with their rain in the remaining next few months. A question. A share price performance has been excellent in the last one to two years. What do you think of the next major news item to move the share price significantly? I think I hopefully answered that a little bit. I don't think there's one news item that doubles or triples our share price. I think it's a maturation of the business that we grow by degrees.

Charles: I think what we're looking for, given that Northern Mexico as a whole is in relative drought conditions, I think the whole Northern Mexico would love to see some proper rains. Hopefully we do see some of those hurricanes blow on without their intensity and with their rain in the next few months. A question, share price performance has been excellent in the last 1 to 2 years. What do you think of the next major news item to move the share price significantly? I think hopefully I answered that a little bit. I don't think there's one news item that doubles or triples our share price. I think, you know, it's a maturation of the business that we grow by degrees.

Speaker #2: so hopefully we do see some of those, hurricanes blow on without their intensity and with their rain in the, in the remaining next few months.

Speaker #2: A question: share price performance has been excellent in the last one to two years. What do you think of the next major news item to move the share price significantly?

Speaker #2: I think I hopefully I, I answered that a little bit. I don't think there's one news item that, that doubles or triples our share price.

Speaker #2: I think, you know, it's a maturation of the business that we grow by degrees. And I think what I like about the way the share price has performed over the last couple of years is it's been relatively steady increase as we've de-risked the business, demonstrated production capacity, and obviously had the strong, tailwind of the gold price.

Charles: I think what I like about the way the share price has performed over the last couple of years is it's been relatively steady increase as we've de-risked the business, demonstrated production capacity, and obviously had the strong tailwind of the gold price. I think it's providing a certainty that we can grow our production profile in 2026. I think it's showing the value of an expanded La Colorada of Cerro de Gallo and then of delivering Ana Paula. I think that you would like to deliver more steady performance and steady value steps in the company with the potential surprise of we've got open resources, we've got excellent districts that we're exploring in, and we've got significant drill programs. We do have the potential for surprises to the upside with the drill bit.

Charles Funk: What I like about the way the share price has performed over the last couple of years is it's been a relatively steady increase as we've de-risked the business, demonstrated production capacity, and obviously had the strong tailwind of the gold price. I think it's providing a certainty that we can grow our production profile in 2026. I think it's showing the value of an expanded La Clarada, of Serra de Gaia, and then of delivering Anapola. You would like to deliver more steady performance and steady value steps in the company with the potential surprise of we've got open resources, we've got excellent districts that we're exploring in, and we've got significant drill programs. We do have the potential for surprises to the upside with the drill bid. Are you seeing any price inflation in 2025 on operating supplies in Mexico?

Speaker #2: So, I think it's providing a certainty that we can grow our production profile in 2026. I think it's showing the value of an expanded the La Colorada of Saratogaia and then of delivering Annapola.

Speaker #2: So, I think that you would like to deliver more steady performance and steady value steps in the company, with the potential surprise of: we’ve got open resources, we’ve got excellent districts that we’re exploring in, and we’ve got significant drill programs.

Speaker #2: So we do have the potential for surprises to the upside with the drill bit. are you seeing any price inflation in 2025 and operating supplies in Mexico?

Charles: Are you seeing any price inflation in 2025 on operating supplies in Mexico? Gregg, I might hand this one to you as well.

Speaker #2: Greg, I might hand this one to you as well.

Charles Funk: Greg, I might hand this one to you as well.

Gregg Bush: No, actually, we haven't. It, you know, I think we're starting to see a little bit on, you know, some of the inputs for, you know, like reagents, may start to cycle up a little bit. The, you know, the truth is, right, you know, our operations are not, you know, completely normalized. You know, as You know what? Like, once we get into full production at your, you know, San Agustin, then we'll kinda see what, you know, you know, like repair or, you know, replacement parts on the crushing circuit and things like that. I expect that we'll see a bit of inflation.

Speaker #4: no, actually, we, we, we haven't. It, you know, I think we're starting to see a little bit on, you know, some of the inputs for, for, you know, like reagents.

Greg Bush: No, actually, we haven't. I think we're starting to see a little bit on some of the inputs for, like, reagents. May start to cycle up a little bit. The truth is, our operations are not completely normalized. Once we get into full production at San Agustin, then we'll kind of see what repair or replacement parts on the crushing circuit and things like that look like. I expect that we'll see a bit of inflation.

Speaker #4: we may start to, may start to, to, to cycle up a little bit. But the, you know, the, the truth is, right, you know, our, our operations are not, you know, completely normalized.

Speaker #4: So, you know, it's, it's, you know, what like once we get into full production, or, you know, at San Augustin, then we'll, we'll, we'll kind of see what, you know, you know, like we're repair or, you know, replacement parts on the crushing circuit and things like that.

Speaker #4: I, I expect that we'll see a bit of inflation. So.

Charles: I think as a broader comment, when the gold price goes up, it's telling you that there's inflation in the economy. It is difficult for gold producers to maintain their asset costs, given that their top line is truly a measure of inflation. I think to date, we've been relatively immune to that with our systems in Mexico, but I note that it is an ever-present risk as we expand our business. There's a couple of questions here. Two different questions asking about asking about the decline at Ana Paula. We haven't made any formal decision on when we're going to continue and push the decline down into the ore body. What I have always done personally is, I believe when we're cash flowing from San Agustin, that is the catalyst.

Speaker #2: yeah, I think as a broader comment, when the gold price goes up, it's telling you that there's a flash inflation in the economy. so it is difficult for gold producers to maintain their ASIC costs, given that their top line is truly a measure of inflation.

Charles Funk: Yeah, I think as a broader comment, when the gold price goes up, it's telling you that there's inflation in the economy. It is difficult for gold producers to maintain their AISC costs, given that their top line is truly a measure of inflation. I think to date, we've been relatively immune to that with our systems in Mexico, but I note that it is an ever-present risk as we expand our business. There's a couple of questions here, two different questions asking about the decline in Anapola. We haven't made any formal decision on when we're going to continue and push the decline down into the ore body. What I have always done personally is I believe when we're cash flowing from San Agustin, that is the catalyst.

Speaker #2: I think to date, we've been relatively immune to that with our systems in Mexico. But I note that it is an ever-present risk, as we expand our business.

Speaker #2: There's a couple of questions here, two different questions asking about the decline at Annapola. We haven't made any formal decision on when we're going to continue and push the decline down into the ore body.

Speaker #2: What I have always done personally is I believe when we're cash flowing from San Augustin, that is the catalyst. So, what I would like to do as the CEO, is start that restart that decline in Q1 next year, probably at the back end of Q1 next year, and complete that in 2026.

Charles: What I would like to do as the CEO, is restart that decline in Q1 next year, probably at the back end of Q1 next year, and complete that in 2026. Our plan is to do that, to do all the work to present that for a decision late this year. As a company, we haven't formally made a go decision on doing that, but I would anticipate that that's something we want to achieve in 2026. We think it's a lovely de-risking step of getting into the ore body. We think it has benefits in terms of potentially moving the timeline of construction of Ana Paula forward. It has particular benefits of being a drill platform for infill and expansionary drilling on the Ana Paula resource.

Charles Funk: What I would like to do as the CEO is start that, restart that decline in Q1 next year, probably at the back end of Q1 next year, and complete that in 2026. Our plan is to do that, to do all the work to present that for a decision late this year. As a company, we haven't formally made a go-to decision on doing that, but I would anticipate that that's something we want to achieve in 2026. We think it's a lovely de-risking step of getting into the ore body. We think it has benefits in terms of potentially moving the timeline of construction of Anapola forward. It has particular benefits of being a drill platform for infill and expansionary drilling on the Anapola resource. Look for an update on that late this year, early next year, but it's my bias to do that decline next year.

Speaker #2: our plan is to do that, to do all the work to present that for decision late this year. So, as a company, we haven't formally made a go decision on doing that, but I would anticipate that that's something we want to achieve in 2026.

Speaker #2: We think it's a lovely de-risking step of getting into the ore body. We think it has benefits in terms of potentially moving the timeline of construction of Annapola forward.

Speaker #2: it has particular benefits of being a drill platform for infill and expansionary drilling on the Annapola resource. So, look for an update on that late this year, early next year.

Charles: Look for an update on that late this year, early next year. It's my bias to do that decline next year. I think we're going to have the cash flow to comfortably do that program. A couple of questions on, can you comment on the depth potential at Ana Paula? Right now, most of our drilling, the 15,000 m drill program that we have underway, is focused on the high-grade panel. It's in the first 250 m of the ore body. We're trying to convert inferred resources to M&I so they make the reserve. We also think that there's some room to potentially expand that as well. We've always known that the deeper part of Ana Paula is open. There's deeper hits, like, 13 m at 29 g, 40 m at 6 g.

Speaker #2: But it's my bias to do that decline next year. I think we're going to have the cash flow to comfortably do that program. A couple of questions on, so can you comment on the depth potential at Annapola?

Charles Funk: I think we're going to have the cash flow to comfortably do that program. A couple of questions on, can you comment on the depth potential at Anapola? Right now, most of our drilling, the 15,000-meter drill program that we have underway, is focused on the high-grade panel. It's in the first 250 meters of the ore body. We're trying to convert inferred resources to M&I so they make the reserve. We also think that there's some room to potentially expand that as well. We've always known that the deeper part of Anapola is open. There's deeper hits, like 13 meters at 29 grams, 40 meters at 6 grams. We've had an original plan of let's get that decline down and use that as a platform for the deeper drilling.

Speaker #2: So, right now, most of our drilling—the 15,000-meter drill program that we have underway—is focused on the high-grade panel. It's in the first 250 meters of the ore body.

Speaker #2: we're trying to convert inferred resources to M&I so they make the reserve. We also think that there's some room to potentially expand that as well.

Speaker #2: We've always known that the deeper part of Annapola is open. There are deeper hits, like 13 meters at 29 grams, and 40 meters at 6 grams.

Charles: We've had a original plan of let's get that decline down and use that as a platform for the deeper drilling. Although right now we are looking at the potential of maybe doing a bit of deeper drilling to follow up those as part of that resource conversion. Ana Paula, geologically, is a distal skarn. There's a hot intrusion that's driving gold-bearing fluids into the rocks above that. To the south of us are two very large deposits, Torex's Morelos Complex and Equinox's Los Filos Complex. You know, 15 and 20 million ounce deposits. If we're right about our geological interpretation, there should be more gold deeper going down to that driving heat engine that drives it. We need to just go deeper to do that.

Speaker #2: We've had a regional plan of let's get that decline down and use that as a platform for the deeper drilling. Although right now, we are looking at the potential of maybe doing a bit of deeper drilling to follow up those as part of that resource conversion.

Charles Funk: Although right now, we are looking at the potential of maybe doing a bit of deeper drilling to follow up those as part of that resource conversion. Anapola, geologically, is a distal skarn. There's a hot intrusion that's driving gold-bearing fluids into the rocks above that. To the south of us are two very large deposits, Torex's Morelos complex and Equinox's Los Filos complex, 15 and 20 million ounce deposits. If we're right about our geological interpretation, there should be more gold deeper going down to that driving heat engine that drives it. We need to just go deeper to do that. Right now, we're looking at potentially expanding our drill program at Anapola, and that would have the first deeper drilling that we've done as a company. Watch this space on Anapola.

Speaker #2: So, Annapola, geologically, is a distal skarn. There's a hot intrusion that's driving gold-bearing fluids into the rocks above that. To the south of us are two very large deposits: Torix's Morelos complex and Equinox's Los Filos complex.

Speaker #2: You know, 15 and 20 million-ounce deposits. If we're right about our geological interpretation, there should be more gold deeper, going down to that driving heat engine that drives it.

Speaker #2: We need to just go deeper to do that. So right now, we're looking at potentially expanding our drill program at Annapola, and that would have the first deeper drilling that we've done as a company.

Charles: Right now we're looking at potentially expanding our drill program at Ana Paula, and that would have the first deeper drilling that we've done as a company. Watch this space on Ana Paula. The initial focus is in the shallow area, and then we'll look to go deeper from there. There's a couple of other Ana Paula questions. Ultimately, we're looking to get into production in 2028 at Ana Paula. Gregg and the team have completed the flow sheet design that set what the tailings material look like in the current study. That sets the permit modification to move to an underground permit that we anticipate submitting late this year. We expect to have that permit by late next year. We'd be looking to make our construction decision in 2027 for production in 2028.

Speaker #2: so watch this space on Annapola. The initial focus is in the shallow area. And then we'll look to go deeper from there. There's a couple of other Annapola questions.

Charles Funk: The initial focus is in the shallow area, and then we'll look to go deeper from there. There are a couple of other Anapola questions. Ultimately, we're looking to get into production in 2028 at Anapola. Greg and the team have completed the flow sheet design. That set what the tailings material looked like in the current study. That then sets the permit modification to move to an underground permit that we anticipate submitting late this year. We expect to have that permit by late next year. We'd be looking to make our construction decision in 2027 for production in 2028. We're moving as fast as we think is prudent and appropriate. We have the cash on our balance sheet, so there's nothing holding us up on Anapola other than getting the work done, which is a big focus for us as a company. A couple more questions looking here.

Speaker #2: Ultimately, we're looking to get into production in 2028. At Annapola, the Greg and the team have completed the flow sheet design. that set what the tailings material looked like in the current study.

Speaker #2: that then sets the permit modification to move to an underground permit. That we anticipate submitting late this year. we expect to have that permit by late next year.

Speaker #2: So, we'd be looking to make our construction decision in 2027 for production in 2028. We're moving as fast as we think is prudent and appropriate.

Charles: We're moving as fast as we think is prudent and appropriate. We have the cash in our balance sheet. There's nothing holding us up on Ana Paula other than getting the work done, which is a big focus for us as a company. Couple more questions, looking here. Gregg, I'll throw this one to you. As I've talked about the decline, someone asked us what do you think the cost of completing that decline would be?

Speaker #2: We have the cash in our balance sheet, so there's nothing holding us up on Annapola. Other than getting the work done, which is a big focus for us as a company.

Speaker #2: A couple more questions. Greg, I'll throw this one to you. As I've talked about the decline, someone asked, what do you think the cost of completing that decline would be?

Charles Funk: Greg, I'll throw this one to you. As I've talked about the decline, someone asked us, what do you think the cost of completing that decline would be?

Gregg Bush: Well, the last, you know, we updated those costs to get down to not all the way to the bottom, but near the bottom of the high-grade panel. I think it was, I wanna say it was $12, 13 million to get down there. That wouldn't include, you know, the development to support production. You need, you know, you need ventilation and alternate escape routes and things like that. If, you know, to get into production could double that number easily.

Speaker #4: well, the, the last, you know, we, we updated, we updated those costs to get down to the base of the, well, not all the way to the bottom, but near, near the bottom of the high-grade panel.

Greg Bush: The last, you know, we updated those costs to get down to the base of the, not all the way to the bottom, but near the bottom of the high-grade panel. I think it was, I want to say it was $12 million, $13 million to get down there. That wouldn't include, you know, the development, the support of production. You would need, you know, you'd need ventilation and alternate escape routes and things like that. If, you know, to get into production could double that number easily.

Speaker #4: And I think it was, I want to say it was 12, 13 million dollars. To, to, to get, to get down there. But that wouldn't include you know the development, the support production you'd need, you know, you'd need ventilation, an alternate escape routes, and, and things like that.

Speaker #4: So, if, you know, to get into production could double that number easily.

Speaker #2: Perfect. No, I think, yeah, like, we'll provide a formal update on that later this year once we make the decision to complete the decline at Annapola.

Charles Funk: Perfect. No, I think, yeah, we'll provide a formal update on that later this year once we make the decision to complete the decline at Anapola. One question. I hope the loss of time incidents were not serious accidents for anyone. A little more detail there. One was an inappropriate use of a ladder that led to a rolled ankle. Another one was a hand injury in trying to remove a rock between two wheels of a truck that wasn't done following a procedure. They were serious enough to lose time. They did mean that employees needed medical attention and spent time away from their jobs. It's something that we've had a pretty significant review of as a company. I'm fortunate that they haven't had any long-term effects for those employees. We've really, really spent the last couple of months reviewing our approach to our safety management across our assets.

Charles: No, I think, yeah. We'll provide a formal update on that later this year once we make the decision to complete the decline at Ana Paula. 1 question. I hope the loss of time incidents were not serious accidents for anyone. A little more detail there. 1 was an inappropriate use of a ladder that led to a rolled ankle. Another 1 was a hand injury in trying to remove a rock between 2 wheels of a truck that wasn't done following a procedure. They were serious enough to lose times. They did mean that employees needed medical attention and spent time away from their jobs. It's something that we've had a pretty significant review of as a company.

Speaker #2: One question: I hope the loss of time incidents were not serious accidents for anyone. A little more detail, there. One was an inappropriate use of a ladder that led to a rolled ankle.

Speaker #2: another one was a hand injury. and, trying to remove a rock, between two wheels of a truck. that wasn't done, following a procedure. So, they were serious enough to lose times.

Speaker #2: they did mean that employees, needed medical attention and spent time, away from their jobs. so, it's, it's something that we've had a pretty significant review of as a company.

Charles: I'm fortunate that they haven't had any long-term effects for those employees. We've, you know, really spent the last couple of months really reviewing our approach to our safety management across our assets. We've got a number of initiatives that we're rolling out across the company. It's great to have the production and to have the cash flow. It is something that we're looking to improve as a company, that we can do that with ever-increasing safety standards. I think there's a number of more questions, but we're going over the half an hour. For those who have sent through those questions that we haven't answered on the call, please follow up with a call to myself or to Rob Grey.

Speaker #2: I, fortunate that they haven't had any long-term effects for those employees. And so we've, you know, really, really spent, the last couple of months really reviewing our approach, to our safety management, across our assets.

Speaker #2: And we've got a number of initiatives that we're rolling out across the company. it's great to have the production and to have the cash flow.

Charles Funk: We've got a number of initiatives that we're rolling out across the company. It's great to have the production and to have the cash flow. It is something that we're looking to improve as a company, that we can do that with ever-increasing safety standards. I think there's a number of more questions, but we're going over the half an hour. For those who have sent through those questions that we haven't answered on the call, please follow up with a call to myself or to Rob Grey. You can find our contacts on every press release or our website. We'll endeavor to reach out to those, to anyone who asks a question and try and answer those. We look forward to providing future updates both in person at upcoming conferences and with some significant news flow. The next we're anticipating being the La Clarada technical report.

Speaker #2: It is something that we're looking to improve as a company, and we can do that with ever-increasing safety standards. So, I think there are a number more questions.

Speaker #2: But we're, we're going over the half an hour. So, for those who've sent through questions that we haven't answered on the call, please follow up with a call.

Speaker #2: to myself or to Rob Gray, you can find our contacts on every press release or the, or our website. we'll endeavor to reach out to those, to anyone who asks a question and try and answer those.

Charles: You can find our contacts on every press release or our website. We'll endeavor to reach out to those to anyone who asks a question and try and answer those. We look forward to providing future updates both in person at upcoming conferences and with some significant news flow, the next we're anticipating being the La Colorada technical report. To close out, we'd forecast Q2 to be the weakest of our quarters this year. I think we've performed very strongly in terms of costs and margin and the free cash flow generation of those assets. We look forward to that to expand in the back half of the year, and we look forward to providing updates that we think can lead to an increase in production in 2026. I thank you all for your time.

Speaker #2: We look forward to providing future updates, both in person and at upcoming conferences. With some significant news flow, the next update we're anticipating is the La Colorada technical report.

Speaker #2: to close out, we'd forecast Q2, to be the weakest of our quarters this year. I think we performed very strongly. in terms of, costs and margin, and the free cash flow generation of those assets, we look forward to that to expand in the back half of the year.

Charles Funk: To close out, we'd forecast Q2 to be the weakest of our quarters this year. I think we performed very strongly in terms of costs and margin and the free cash flow generation of those assets. We look forward to that to expand in the back half of the year, and we look forward to providing updates that we think can lead to an increase in production in 2026. I thank you all for your time. I thank you all for your interest in shareholding in Heliostar, and we look forward to providing more updates. The next quarterly update, we'll have another webinar to answer further questions. Thank you all very much for your time.

Speaker #2: And we look forward to providing updates that we think can lead to an increase in production in 2026. So, I thank you all for your time.

Speaker #2: I thank you all for your interest in shareholding in Heliostar. We look forward to providing more updates, and the next quarterly update will include another webinar to answer further questions.

Charles: I thank you all for your interest in shareholding in Heliostar, and we look forward to providing more updates. The next quarterly update, we'll have another webinar to answer further questions. Thank you all very much for your time.

Operator 2: Goodbye

Speaker 1: Goodbye.