Q3 2025 Alamos Gold Inc Earnings Call

Speaker #2: This conference is being recorded , said conference est enregistrée . .

Speaker #3: All participants , please stand by or conference is ready to begin . Good morning , ladies and gentlemen . I would now like to turn the meeting over to Scott Parsons Alamos .

Speaker #3: Senior Vice president of Corporate Development and Investor Relations . Please go ahead , sir .

Speaker #4: Thank you . Operator and thanks to everybody for attending Alamos third Quarter 2025 conference call . In addition to myself , we have on the line today , John McCluskey President and Chief Executive Officer Greg Fisher Chief Financial Officer and Luc Guimond Chief Operating Officer We will be referring to a presentation during the conference call that is available through the webcast and on our website .

Speaker #4: I would also like to remind everyone that our presentation will be followed by a Q&A session, as we will be making forward-looking statements during the call.

Speaker #4: Please refer to the Cautionary notes included in the presentation . News release and MDA , as well as the risk factors set out in our annual information form .

Speaker #4: Technical information in this presentation has been reviewed and approved by Chris Boswick , our senior VP , Technical Services and a qualified person .

Speaker #4: Also , please bear in mind that all of the dollar amounts mentioned in this conference call are in US dollars , unless otherwise noted .

Speaker #4: Now I'll turn it over to John to provide you with an overview . Thank you . Scott . Starting with slide three . Before we go into the report for the quarter , I want to acknowledge that this has been far from a typical production year for Alamos .

Speaker #4: We experienced production downtime and lower production in the first half of the year , which we were on pace to make up in the second half .

Speaker #4: Unfortunately , in recent weeks , downtime at the mill and a seismic event at Island Gold will not give us the time to do so .

Speaker #4: As a result of these recent events , we've taken the prudent course and lowered guidance for the year by 6% from the midpoint of our original guidance .

Speaker #4: We have a reputation for taking a conservative approach to guiding the market , and we pride ourselves on providing consistently accurate guidance . Suffice to say , we will continue to make operational improvements to raise the accuracy of our forecasting .

Speaker #4: Recognizing that occasionally mining can be unpredictable . It remains to be said that while these recent events have a short term impact , they in no way take away from the quality of our minds and what is , without question , one of the strongest outlooks in the gold sector .

Speaker #4: We are already seeing significant improvements this month with better grades at young , Davidson and throughput from the mines . This will ultimately support lower costs and an 18% production increase , leading to record production in the fourth quarter .

Potential to increase Consolidated production to 1 million ounces per year within a similar time frame.

Million dollars in 2025 and expect to generate growing free cash flow. As we execute on this growth, following the startup of Lynn Lake, we expect to generate more than 1 billion of free cash flow annually at current low prices,

now, looking at side 6,

In addition to delivering, on our organic growth plans, we continue to surface value from our portfolio of assets. This included announcing the sale of our Turkish development projects,

for a total cash consideration of 470 million

The transaction closed earlier this week and marks a positive outcome realizing significant value for assets. We had written off in 2021

We received 160 million on closing and uh the remainder 310 million will be received over the next 2 years.

With our strong free cash flow during the third quarter and initial proceeds from the sale of our Turkish assets, our current cash balance has increased over 600 million.

We'll be using the proceeds from the transaction and growing cash position to reduce our small debt position and we expect to be active on our share buyback.

We were also recognized for the second consecutive year.

As a TSX 30 winner by the Toronto Stock Exchange, for our strong share price, performance of 310% over the trailing 3 years.

The award is a testament to our long-term track record of outperformance—something we expect to continue to build upon as we deliver on our upcoming catalysts and organic growth plans.

I'll now turn the call over to our CFO. Greg Fischer to review our financial performance.

Thank you, John on the slide 7. We sold approximately 136,500 oz of gold in the third quarter, at an average realized price of 3,359 per ounce.

The record revenues of 462 million.

The average realized price was below the London PM fix for the quarter primarily due to the delivery of over 12,300 Oz into the gold prepaid facility.

A fixed price of $2,524 per ounce. We will deliver the same number of ounces in the fourth quarter, after which the prepaid obligation will be completed.

As a reminder, the prepaid facility was executed in July 2024, with the proceeds, utilized to retire, 180,000 oz of forward, sale contracts inherited from Argonaut gold across 2024 and 2025 with an average price of 1,840 per ounce.

Based on an average gold price of almost $1,000 per ounce. Since July 2024 the company increased Capital by approximately 40 million over that period, given the decision to buy out, the 180,000 oz of Hedges, 15 months ago, through the execution of that prepaid facility.

Quarter or per quarter total cash cost in all and sustaining costs, decreased 9% and 7%, respectively, and both were in line with quarterly guidance. We expect total cash costs in all sustaining costs to decrease a further 5%. In the fourth quarter driven by higher production across all operations,

we remain on track to achieve full year cost guidance, which was

revised earlier in the year.

We are now reporting total cash costs and all in sustaining costs, excluding the impact of Mark to Market adjustments for the revaluation of previously issued share based instruments.

This methodology provides a better representation of our total costs associated with producing an ounce of gold and eliminates volatility associated with Mark to Mark adjustments.

These marked the market adjustments to long-term instruments impact, both Total cash costs and all sustaining costs given the company allocates, these costs to Mining and processing costs and share based compensation expense on the income statement.

Are reported that earnings were 276 million in the third quarter or 66 cents. Per share. This includes 193 million reversal of a previously recognized impairment related to the Turkish projects

As well as unrealized losses on hedge derivatives foreign exchange impacts and other adjustments totaling 72 million.

Excluding these items adjusted. Net earnings were 156 million or 37 cents per share.

Operating cash flow before. Changes in non-cash working capital was a record 275 million in the third quarter or 65 cents per share.

Capital spending total of 135 million and include 35 million of sustaining Capital, 83 million of growth capital and 17 million of capitalized expiration.

A 10% decrease from previous guidance primarily reflecting lower spending at Lin lake with the rampant of construction, activities shifting to 2026.

Free cash flow for the quarter totaled a record $130 million, a 54% increase from the second quarter, driven by record contributions from all three operations. This includes $73 million from the Mulatos District, $72 million from the Island Gold District, and $62 million from Young-Davidson. Our cash balance grew from $304 million at the end of the second quarter to $463 million. Subsequent to quarter-end, we received initial cash payments totaling $116.33 million from the sale of both our non-core Turkish development projects and the Quartz Mountain project, bringing our total cash position to over $600 million currently.

Combined with the undrawn balance. On the credit facility, our total liquidity is over 1.1 billion.

We expect growing production and decline in cost to drive increasing free cash flow over the next several years.

But continuing to fund our, our organic growth plans.

With a growing cash position. We expect to reduce our 250 million of debt currently outstanding while also evaluating opportunity to buy back shares and eliminate a portion of the remaining Legacy Argonaut hatches.

I will now turn the call over to our coo luki mall. To provide an overview of our operations.

Thank you. Greg over to slide 8.

Third quarter production from the island gold district. Total 66,800 Oz, a 4% increase from the previous quarter.

A more substantial increase is expected in the fourth quarter driven by an increase in Combined, Milling rates from the island gold. And the genome Mills,

the Go's Milling rates continue to increase through the third quarter until the last week of September, when a capacitor failure, within the electrical house, impacted the electrical drive for the SAG and Baal Mills,

this resulted in 1 week of unplanned, downtime.

The capacitor and electrical drive. Module were replaced, by the end of the quarter following, which Milling rates have increased to average a new high in October.

Quarter over quarter underground. Mining rates increased 7% to 1,325 tons per day.

Come fit, mining rates increased 4% to 59,000 tons per day.

Including a 28% increase in our mind to 17,600 tons per day.

Grades mine from underground. And the open pit were consistent with annual guidance.

In mid October a seismic event occurred within the underground operation of Island gold that is delayed. I just to higher grade Stoops of fill within 1 mining front.

Events are not uncommon for underground operations and and Mining rates are expected to remain within guided levels. However, raid's mind in the fourth quarter are now expected to be lower than previously planned.

We continue to expect a significant increase in production and decrease in costs in the fourth quarter, however, given the lower expected underground grades and unplanned downtime, at the end of the third quarter production, guidance for the full year has been revised lower to between 260,000 and 270,000 Oz.

Moving to slide 9, a number of optimization initiatives have been implemented within the Maginot Mill over the past year that continue to drive improvements quarter over quarter.

this included the installation of a redesigned liner and bolt configuration within the SAG Mill in July,

such that following a liner change and excluding the 1 week of unplanned downtime at the end of September billing in rate, Milling rates increased nearly 10%.

With the mill up and running by the end of the third quarter, Milling rates have continued to improve in October.

Approaching 10,000 tons per day, a new monthly high for the operation.

Minimize potential unplanned, downtime in the future and ensure increasing consistency of the operation.

Further review of electrical components was completed to ensure all critical spares, have been identified and are on site.

Moving the slide 10.

Given the unplanned downtime at the Maginot Mill. The decision was made to restart the island gold Mill. The last week of September to focus on processing higher grade underground or

Operating a 2 mils will provide additional operational flexibility with increased Milling capacity.

And allow us to capitalize on the higher goal price environment with stronger goal production.

The restart of the island Mill provides an additional 12200 tons per day of Milling capacity.

This is expected to support approximately 3,000 ounces of additional gold production on a quarterly basis, driving increased, cash flow and profitability.

Associated with operating the island gold Mill.

We will operate the 2 mils through the end of this year and will evaluate its ongoing operation into 2026.

As part of the expansion study.

Over to slide 11. The phase 3 plus expansion continues to progress with the shaft sink now at the 1350 meter level.

98% of the ultimate depth of 1379 m.

Work also commenced on the 1350 level shaft station.

The minimum expansion to 12,400 tons per day is progressing well and is on track for completion in the second half of 2026.

Base plan, construction is advancing and expected to be completed in the first quarter of 2026.

Mechanical and electrical outfitting for the water, Hamming, facility in shaft in houses ongoing.

And concrete foundation work for the new administrative complex is underway.

Over to slide 12.

As of quarter end, we have spent and committed 84% of the total Phase 3 plus capital of $835 million.

The photos on the right highlight, the programs on the shaft sink and 1350 level shaft station.

We expect to be skipping or from this station in the latter part of next year, with the expansion on track for completion in the second half of 2026.

Over to slide 13. We continue to advance the expansion study for the island gold district, which includes the evaluation of a larger Mill expansion of up to 20,000 tons per day.

The study is expected to include a larger mineral Reserve through ongoing mineral resource conversion.

With encouraging results from our delineation drilling program, supporting a strong rate of conversion and Reserve growth.

We're currently underway as part of the phase 3 plus expansion to 12,400 tons per day is being completed with a larger expansion in mind.

This includes sizing the footprint of the new Mill building to accommodate additional equipment for further expansion of up to 20,000 tons per day.

To ensure all the assays from the recently completed delineation drilling program are incorporated into the expansion study, we have shifted the completion of the expansion study from late this year to the first quarter of 2026.

With a larger mineral reserve and higher combined mining and milling rates, we expect the expansion study will demonstrate significant upside to the base case plan released earlier this year.

Over the slide 14.

Young Davidson produced, 37,900 ounces in the quarter. Similar to the second quarter reflecting, the plan, shutdown of the north gate shaft. The first week of July to change the head ropes

Reflecting the downtime mining rates average 7,300 tons per day in the quarter.

Given the lower mining rates earlier in the quarter excess milk capacity and higher grade prices, sorry, higher gold, prices.

The low-grade stockpile or was processed.

Mil throughput rates average 7,000,800 tons per day in the quarter. A 12%, increase over the previous quarter.

The reflecting the contribution of lower grade stockpile lower process, grades of 1.79 G per ton were 7% lower than mine grades.

Being a Milling rates for the first 9 months of the year. Production guidance has been revised lower to between 160,000 and 165,000 Oz.

Mining rates have returned to targeted levels, averaging 8,000 tons per day in September and October, and are expected to remain at similar levels for the remainder of the year.

Grades might also increase towards the upper end of guidance in October at 2.25 grams per tonne and are expected to remain at similar levels. The rest of the quarter,

Hi your mining rates and grades young Davidson is expected to have a much stronger fourth quarter with higher production and lower costs.

Mine site all in sustaining costs decreased in the third quarter.

With a further, decrease expected in the fourth quarter, the operation remains on track to achieve the full year cost guidance. That was revised earlier in the year.

Young Davidson continues delivering, strong mindsight free cash flow with 62 million generated in the quarter and 160 million in the first 9 months of the year.

Already surpassing the previous full year record of 141 million in 2024.

With strong ongoing free cash flow. The operation is on track to deliver, well, over 200 million for the full year at current gold prices.

Over the slide 15.

Production from the mulato. District total 37,000 oz in the third quarter. A 9% increase, quarter over quarter with the operation, benefiting from strong ongoing, stacking rates and grades.

and the recovery of previously stacked Oz,

Order as the operation benefits from the recovery of higher grade, or stock in the previous 2 quarters.

With higher production expected in the fourth quarter, we are increasing full year production, guidance to between 140,000 and 145,000 Oz.

Reflecting the stronger production cost decline in the third quarter, and with a further decrease expected in the fourth quarter.

The operation is well-positioned to meet its full year cost guidance.

The PDA project continued to advance during the quarter with the focus on procurement of long lead items and detailed engineering.

Expenditures are expected to increase in the fourth quarter and more significantly into 2026 with the wrap up of construction activities.

Coj remains on budget and on track to achieve initial production, mid 2027.

The mulattos District generated mindsight free cash flow of 73 million in the quarter and 129 million in the first 9 months of the year.

It remains well, positioned to continue generating strong. Free, cash flow. Well, fully funding construction of PDA.

With that, I will turn the call back to John.

Thank you, Luke.

What a reiterate that uh this has not been a typical year for Alamos and not reflective of our long-term record of meeting or exceeding expectations.

our near-term and long-term Outlook remain bright and

it's 1 of the strongest growth policies of the sector. We remain confident in our uh ability to deliver on our guidance.

Expected demonstrate, this strong Outlook. Starting with the significant increase in production and decrease in costs in the fourth quarter.

I'll now turn the call back to the operator, who will open up for your questions.

I mowed we'd like to open up the call for a Q&A now please certainly. Thank you. We will now take questions from the telephone lines. If you have any questions, please press star 1

You may cancel your questions at any time, by pressing star 2.

Please press star 1 at this time. If you have any questions,

there will be a brief pause while participants register for their questions and we thank you for your patience.

Our first question is from Cosmos 2 from CIBC please. Go ahead.

Great. Um thanks John and team. Um maybe my first question is on the Q4.

Um, John, as you mentioned, uh, you know, we're expecting, um, increases to production in Q4 you've given us a range 157, 277,000 Oz. Um,

Fairly sizable range, uh, especially for quarterly production. Could you maybe just touch on? You know, some of the factors that could lead you to the higher end of that, guidance versus say the lower end.

Uh, cause those High Luke here. I mean, just hi, Luke across the, uh, operations, as we've touched on. I mean, we're, we're, we're consistently delivering on the, the higher mining rates with young Davidson at 8,000, tons per day, the Big Driver really for the, the higher goal production. Also, coming at a young Davidson in the fourth quarter is related to grade. Uh, you know, based on the Mind plan that we have put forward for the fourth quarter. Uh, we're expecting to be at the high end of our, our guided grades of 205 to 225. So we're at the higher end of that 225 uh area um with regards to mottos. Um, it's really a function of, you know, we've stocked a lot of gold in the first couple of quarters, q1, Q2 and certainly Q3. And we'll start to see more of that gold production coming off the leech pad in, in the fourth quarter, which will drive higher production for for mulato Island gold. Uh, we continue with, uh, you know, similar guided levels of mining rates and, and certainly great performance as well, through

Fourth quarter is expected from from Ireland. So, when you combine those, those 3 Catalyst from those operations, that's what's really driving the higher gold production, uh, in in the fourth quarter,

Mhm. Okay.

Um, and and Luke, since I have you here, maybe could you maybe elaborate a little bit on that size and activity? That happened that, uh, at Island gold, um, in mid October? Um, it sounds like it's not, uh, you know, a permanent issue. It doesn't seem like it has longer term impacts, but could you give us a bit more granularity in terms of sort of what happened? Was it in a higher risk area?

Yep, I can touch on that a bit, but so I mean just just you know, emphasize seismicity is just is is is a natural aspect of a current that occurs with underground mining operations. So you uh you know as we extract your body through development and production blasting we're we're changing the

And they were the 1 mining front. That was affected with this seismic event. Uh, really the, the reason that we've been able that we've had to,

Uh stop production from that 1 area is due to the fact. That from a legislative perspective we need to have 2 means of egress out of the mine, 1 being the ramp system and an Island's case. The second 1 is an escape weigh between the levels.

Uh and with this seismic event that happened within this 1 area, the the Escape was compromised, meaning it needed some Rehabilitation uh in order to bring it back online. So we're just in the process of doing that. Uh, it's not a long-term delay. We would expect to be back in that. Mining front area. Early December to continue production in there, so it's not a long term.

A residual effect as a result of the seismicity, but it is normal course of business. We always have seismic events some can be lower, elev, lower levels and some can be higher levels. Uh, and this case, it just resulted in some damage to the Escape rate which we're addressing

And look, uh, you know, these just giveaways more permanent infrastructures. I would have thought that they are built to a standard that can, uh, certainly withstand some of these, uh, stress regimes. Um, but you know, again, there's there's, uh, there's other factors as well. I guess my question is, uh, was that unexpected has this happened before? And what do you now have in place in terms of, you know, again, I understand that these, uh, size activity happens. But what, what happens in place now, to hopefully, uh, mitigate some of the risk on a go forward base?

Yeah, look. I mean, I I kind of reference with regards to our Ground Control Management plan and, and our, um, seismic manage plan management plan that we have in place for all of our underground operations. In this case, you know, the the ground support, um, continues to to develop and and and change, as we, we get into different mining areas and and maybe different elevations of of stress that are that are being seen within the mining operations. So, we adjust accordingly with that. We do have a lot of dynamic support in place to mitigate these sort of environments that happen when we do have an elevated stress environment. And in this case, for the most part, I'd say the ground support actually worked as for expected. Um, but just keep in mind, uh, you know, Rehabilitation is just kind of also a natural function of an underground operation residually, uh, you know, the scaling activities that occur and and and some additional ground support requirements as a result of some of these openings being open for a long longer term and in this case, the Escape weight being 1 of those. And so it's it's not uncommon to actually have to go back in and do some

Rehabilitation in this case again, because of the fact that the the Escape wave is being compromised. We've just had to, uh, to go in and repair that escaped related to be able to resume mining activities within that mining front.

Great. Um, maybe 1 last question. Uh, as you mentioned expansion, study Quality, Gold is now, uh, expected in q1 2026 versus Q4 2026, uh, 2025. Uh, in part to incorporate potentially including the island gold Mill. Uh in terms of running it into 2026 but I guess in the end maybe bigger picture um you know gold prices are certainly much higher now compared to when you put out the island gold. The first base case study, um, is there a bit of a shift in terms of thinking here in terms of, you know, lower grade material? Can actually now be profitable. Um, so maybe running Island gold for longer. Uh, could increase the overall, uh, throughput. And, uh, you know, in the end, uh, some of that lower grade book is still generate cash. And overall cash flow uh, is higher. Is there is there that kind of thinking going on right now? John, in terms of how you're looking at the, the

Uh Island goals and maybe even a broader picture as well as the other operations and then you know how would that be incorporated into uh the year end? Sort of Reserve resource um statement that's coming out. Like what kind of gold price? Would you look at

I've got to go down as 1 of the longest questions in history class but

Looking at.

Island goal.

At the time we acquired Argonaut with the idea of um integrating both Minds we envisioned that that would um ultimately evolved into something like a 20,000 ton per day operation. And we're we're doing the work right now in in order to um,

With the the, the lower cost.

And the um, higher throughput rate of of not putting anything in stock, I'll just putting it all through the mill. That's a much more profitable way to go about it. What we'll be able to demonstrate that with the numbers. Uh,

That will provide early next year but the, um, you're not double handling or, uh, on a combined grade. Um, you know the words.

Mixing in that lower grade material. It's basically running around half a gram uh, mixing that in with the 1 gram material, we're still running a a pretty uh, decent head grade um but you're just doing it all at a greater scale. So you're benefiting from the economies of scale and absolutely uh, doing it at a lower cost because there's no, there's no double handling any any anymore. So from the point of view of, um,

This.

This bigger mine, uh, that that we envisioned at Island gold. It also envisions, um, roughly 3,000 tons of, uh, underground throughput from the, uh, the island mine itself. Um, that takes production up over half a million ounces, a year brings costs down closer. To that 11,100,200 A6 somewhere in that range. The study will Define it, uh, more precisely. But you can see, you know, that

that we're sitting on roughly, you know,

somewhere between 11 and 12 million ounces of reserves and resources. That that's a really, um, sensible approach to take for the development of that mine. Um, we can get there with relatively, um,

um,

how do I put it? You know, bite-sized Capital costs. It's it's not it's not a a real stretch for us to get it there.

and um,

you know, it's uh, it's it's sort of the next step in our in our Evolution at that uh at that project site. We're not thinking about that uh,

Either um young Davidson or mattos know, young Davidson it. It's not really that sensitive to the gold price.

To be honest, it's just the way that our body is; we're mining it. Um,

In in, in a very profitable way, we're generating, you know, phenomenal, cash flows. And now we've got uh we we've got that Mill running very very well. Consistently hitting 8,000. Tons a day, you know, you're going to see uh, young Davids. Have a great year next year. Um, long term at uh,

At mados, you know the the the game changer is going to be uh Going Underground and Mining high-grade Underground.

Sulfite material and processing it through the mill that we're going to build that that, that really is uh, the future for a lotos. I mean, it's not like we've run out of targets for um, for finding additional oxide material. It's a big district and and we're still poking around uh, doing Green Fields expiration in various areas and and actually getting some interesting results. But

The, the main thrust of what we're we're doing. At mulattos, is to transition from

Uh, Heap bleach low-grade Heap, bleach production to higher grade underground production.

Um, so that would that, you know, in, in, in, in in, in the grand scheme of things, that's where we're going. It's not like we're taking this 1.

Um, 1 concept driven by a higher gold, price and trying to apply it across every operation.

yeah, the only other thing I'd add there Cosmo is just you know with regards to the 20,000 tonne per day um

uh,

Plan for the, uh, for the Island Gold District, but that hasn't changed. I mean, we're still looking to put that obviously out. We've changed the guidance on that to put it out early in Q1. But, um, you know, it allowed a plan of running the world at 17,000 tons per day, coming from open pit operations, and 3,000 tons per day coming from underground operations. So that still is the plan as far as the Island Mill; that we're still continuing to run at this.

Since we restarted in, uh, in September, uh, we'll evaluate that as part of our business plans for for 2026, but, you know, given this High gold price environment, uh, giving us more gold production, certainly and more cash flow. Uh,

It, it may make sense to continue to run that in 2026, but we're still evaluating that.

Great. Uh, thanks. Sorry, for my extra long question. I still haven't thanked Scott. Parsons for putting out earnings during game 5 of the World Series. It certainly has not impacted my performance. So, thanks again, John and

Thank you. Following question, is from Os aib from Scotia Bank. Please go ahead.

Hi, John and Alamos, team couple of questions from me as well. Um,

The seismic activity at Island gold. Um, again really glad to hear. No Personnel or equipment were impacted by this event. Uh so that was really good to hear. But in in terms of uh and maybe this question for Duke, um, in terms of active mining fronts, um, you know, how many active mining plants do you have access to um, at Island gold uh, as well as you know? How does this impact mine sequencing going into 2026?

Yeah. And we typically carry about 3 to 4 mining fronts with the mining rates that we're currently uh running out right now for these but I mean obviously with the ramp up as we continue to head towards 2400 tons a day uh through the course of next year we will be our development will put us into a place where we will be developing more mining fronts. As I mentioned in this case, uh, you know, we've just basically shifted our, our Focus from this 1 mining front. That's been uh, put on hold until we get that escape weigh in place and and look to generate production from some of the other areas of the mine in the interim. Uh, but our, as I mentioned, it's a short term.

Um, issue with regards to the seismic event that happened there. And and we're looking to resume the mining in that specific mining front, uh, early in December

Thanks for the call on that uh look and and and then just also in terms of when you do get access to additional money funds, I mean, in terms of isn't that a mitigating Factor on itself? Um, you know, going into 2026 then

Sorry, can you repeat that question? At least I didn't quite get it.

I'm basically trying to figure out is, when you do start increasing the number of mining fronts as you go into 2026 and into the expansion, isn't that a mitigating factor on itself?

With regards to the production profile, you have, certainly gives us more flexibility.

I think is what you're getting at. Yes, it will give us more flexibility as far as maintaining the mining. Uh, the rates that we're looking at. But again, in this case, uh, you know, we haven't changed our guided levels for Q4 for mining rates, it's just that we've had to refocus some of the activity as far as our production, for the fourth quarter, because of the fact that uh, you know, we got about a 6 week Interruption from this 1 mining front until we get the Escape weigh reestablished.

Perfect. Thanks for that. And, and just, uh, moving on to minino, uh, with the unplanned downtime at my goal. Uh, that was, I believe late, September, uh, will you also able to take advantage of this downtime to do any sort of additional maintenance on the mail as well? We did. Uh, but you know, through the quarter, I think we spoke about this with the the last quarter to release that. Uh, you know, there was a liner bulk configuration redesign that we that we actioned in the quarter, so we did that in July. We also had some scheduled maintenance in August for the ball mill. Uh, but certainly with that 1, we can arrive.

With regards to the the capacitor failing with which led to the drive module also failing uh that we had to get replaced. Uh we did take the opportunity to do some other plant maintenance within the Maginot Mill facility as well.

Okay, thanks for that. Uh, and and just uh then uh moving uh toward the exploration. Um, I don't know if uh the other Scott is online but

Uh, hey Scott. Uh, so can you give us a brief kind of overview of where you are currently focused on, uh, on the exploration side and especially if you continue to have success on um, you know, Island Gold West as well as in close proximity between the Medina.

Yeah. You can provide a an overview uh, year to date of you if you look at um, Island gold. I mean, we really did shift our strategy from the start of the Year, from expiration, uh, into delineation and that the delineation program. Now, has been completed successfully in the, in the third quarter, both at Mino, and at Island gold. And that, that really was focusing on converting that inferred mineral base that, uh, that remains the, the our June update, um, for the expansion study converting that into a reserve. So that process now of, uh, um, The Reserve, uh, calculation is underway, uh, with the delineation results, uh, coming in, or have have been have been received, um, at Ireland as well. I mean, we'll continue now shifting in the fourth quarter to expiration. So we're we're drilling Island down plunge, we're drilling. Uh, the upper

To the West between Island and Maginot within that main island build structure. Um, so that that's ongoing. We've also started, uh, Phase 2 drill program and Coin and Edwards, which is building off the success of, uh, the first part of the year. That's the, uh, past producing Minds that are, uh, 7 kilometers from, uh, from the Maginot Mill. And, uh, we're excited about, uh, the results that we put out in the first half of the Year and that that expiration is ongoing.

Continue uh stepping out from uh that the zone that we've defined looking to expand uh expand on that mineralization and we're also starting a regional program in the fourth quarter at Young Davidson focused on Roots Target which is only 3 kilometers from the uh young Davidson Mill and we see that as potential for future um open pits uh uh or that could come into a uh The Mill at some point in the future.

Uh, at uh, mulattos is John touched on, uh, really focused this year on qualified, expiration at across the district, and having success in several targets, uh, building on the, in the first half of the Year drilling at PDA, continue to expand mineralization at 0 pain, uh, testing a number of other cells by Targets in that District that, uh, um, the team has worked up and, uh, you know, we're uh, uh, excited by some of the results that we're seeing, uh, at a molotow. And I think, you know, that really points to, uh, you know, the transition is John said from, you know, shifting from looking for oxide, which we we're still doing and they're still targets, but really focusing in on building out the sulfide inventory, the high grade underground components of, uh, what could be the future of that District? I guess the last point I'll shift to is, uh, Kovac. Which was the the Greenfield project in, uh, in nunic in Northern Quebec. Um, that we acquired with Orford mining, uh, that, uh, expiration on on on quevic was executed in the the third quarter.

We plan on doing 7,000 meters, we did 9,000 meters. Um and really the the the objective there was uh, trying to find the source of these high-grade Boulders that have been defined across the that belt. Uh, so we drove in 5 target areas. Uh, assays are just coming in, um, but uh, um, you know, certainly happy to be got, we accomplished more drilling there than what we anticipated. Based on the execution of the program and what we're seeing in some of the core

That's, uh, thanks Scott for that. And that was a great, uh, overview of exploration, appreciate that. Um, that's it for me guys. Uh, thanks for taking my questions.

Thank you. I'm following question, is on pabel, Turk from Jeffrey's please. Go ahead.

Hi, thanks for taking my question. Um, just on the Magino Mill, can you, uh, maybe provide some more color on how you're thinking about the targeted throughput? Maybe by the end of this year, I believe it was previously 11.2 thousand tons per day and then 12.4 thousand tons per day next year. How should we be thinking about that, given some of the rank of issues so far?

Yeah, this is Luke Carol. So similar similar line of sight. Um, as I mentioned through the third quarter, there are certain, we had, uh, you know, some some changes to make to the Sago with regards to the liner bolt configuration which we did.

Schedule, ball mill, liner change. And then what's obviously the failure with the capacitor in, uh, September that? Um, um, put us back a bit, but really starting in mid July up until that capacitor issue that we had at the end of September. Uh, the mill was, was on a path. It was consistently delivering above 10,000 tons per day, uh, through that period. Um, and since we've repaired the the, uh, the capacitor failure that we had at the end of September and resume Milling activities to the month of October. We've been consistently averaging, uh, you know, just above 10,000 tons per day as well. So our our our, our our goal to hitting that 112 by the end of the year still uh is is intact uh just some more fine tuning that we need to do between now and the end of the quarter to be able to consistently deliver on that.

On the 124th scenario longer term. Um we're obviously working on some of that expansion already. We need we need more additional equipment at the back, end of the mill, with regards to the CIP, the leaf circuit

Uh, the refinery and illusion in order to be able to handle a higher gold content coming into the plant. So we're working through that. The other aspect of it is also up front. The crushing capacity is there, and it's just we're still evaluating the grinding capacity requirements with the potential for a third.

Third, grinding circuit in in that circuit, to be able to support the 124. But we're still evaluating that as part of the overall build expansion to be honest with you. And that's part of what will come out, uh, early in the new year.

Okay, that's helpful. And then maybe just as a follow-up. So if, if the Maginot Mill is able to get to, uh, 112,000 tons per day by the end of this year, things are improving. Would that be reason enough? Not to keep running the island gold Mill.

I I I think at these gold prices far it's uh it's probably I mean we're evaluating this, but I would think um we want to put as much throughput as we can through and and running those 2 mils of these gold prices, uh, probably makes sense.

Got it. Thank you very much.

Thank you.

Um, yeah, hi, good morning. Um, thanks for taking my questions. Um, most of my questions have been asked and answered, so, uh, maybe a question for Greg. Um, so with over 600 million cash balance, um, you indicated that you will be more active and BuyBacks. Um, or should we think about the Cadence of buybacks on a quarterly or an annual basis? Um, do you have a Target run rate in mind and also given your, um, growth projects, um, or should we think about like a minimum cash balance?

Yeah, thank you. I mean

Share buyback.

Perspective.

I want to do is be opportunistic with respect to that, uh, and we also look at our other, uh, needs of capital. Um, you know, whether it's growing the business, whether it's paying down debt. So we're looking at all of those. Um, so I don't want to point to a specific Target in terms of of the BuyBacks. But um, you know, based on the the pullback and the share price, uh, in the goal price that we've seen over the last, you know, week to 2 weeks, uh, plus the, the reaction today. Um, you know, we we expect to be active on the share buyback. Um, and then in terms of a minimum cash balance. Uh, again, I, I

We have lots of liquidity. We have 1.1 billion of liquidity currently. Um, in terms of the, the current cash balance of 600 million, um, you know, we want to be active on the share buyback. We want to pay down some debt, um, we want to evaluate whether we're going to buy back some of the uh Legacy Argonaut edges. All of those will be sources of of, of capital. Um, but we are ultimately growing. The business from 600,000 oz to, uh, you know, upwards of a million ounces by the end of the year. So we do need to make sure that we have, uh, sufficient Capital. Um, but we do have free cash flow as we speak right now. So, from a minimum cash balance, you know? I I, I'd say, we'd probably want to always have at least 300 million, 250 million to 300 million on on, on the uh, on the balance sheet.

Um, okay. Thank you. Um uh maybe a question on young Davidson. Um so it it it seems the mail has been operating at 8,000 tons per day for a couple of months now. Um, do you think the Mills performance has reached a level that it can continue to consistently operate at this level? And given the current goal prices is is there potential for maybe

Push pushing the mill to a higher end rate.

Yeah, the mill, the mill has been performing quite well at Young Davidson. I mean, obviously our um,

The the overall lower production that's come out through through Q3 and and some of the previous quarters has been more related to giving all of the fee that we can from the mining operations and certainly in Q3, it was related to the Hoist rope change that we had to make with regards to the Head ropes, uh, but the mill has been performing quite well. It's no issues there with the on the aspect of actually looking to see if it can do more, that's something that we've been uh, looking at and seeing with other opportunities, to be able to increase, uh, the overall throughput through that Mill complex.

It would not necessarily come from more underground or uh, you know, the the, the the, the, the minds designed and the infrastructure is designed to support, 8,000 tons per day. Uh, but there's other opportunities with some of the smaller satellite open pit deposits within the region of of young Davidson, uh, that we could look to bring into a mind plan and, and provide additional, uh, Mill feed to the, uh, to the yd Mill complex with, you know, with some minor Capital requirements to be able to do that. Uh, you know, the potential would be to probably get it up to probably 9,000 tons per day, consistently,

Okay, thank you.

Thank you.

Once again, please press star 1 at this time for any questions or comments.

Following question is from Don. De Marco from National Bank, please go ahead.

Thank you, operator. And uh, good morning, John and team. Um, I maybe just a quick question on the capacitor uh incident. Uh what were the root causes of that? And is there a risk of a repeat?

The the capacitor failure. Uh,

Device. So I don't have a firm answer on that, but, um, it's not something that you would typically see to be honest with you. So there could have been a defect within that part itself. I mean we've been running our Island goals.

And our young Davidson build complex for years, and I've never experienced that sort of failure with a capacitor, but it wasn't just the capacitor, the capacitor feeling was part of it, but that led to some residual damage within the uh the drive unit of uh of the power module that you know, operates the the signal and the ball mill. So we had some other component failure there like resistors.

What happened with that capacitor?

Yes. Okay.

Look forward to that and uh it sounds like the timing of just the other thing I would add to that is that you know, from a inventory aspect and just making sure that we have all of the parts we have done another referral further thorough review of our electrical components for running that plant to make sure that we have all of the uh critical spares that we need. Um just to prevent any sort of, you know, significant downtime moving forward.

Okay.

Uh, then just to my next question. Um,

With regard to the Maginot Mill and combining the 2 or streams back into that Mill.

Uh, it sounds like it's potentially 2026 maybe later.

Seems like there's good reason that this gold price to keep the 1200 tonne per day Island. Mill running.

But since you've done it before, you've done it, once already in July, with the second time around, be somewhat routine just with a quicker ramp up.

Yeah, it's pretty seamless, to be honest with you, to put both or streams into the, uh, into the 1 plant. Um, you know, I think I've mentioned before we did a couple of batch tests just to confirm the Metallurgy back in Q2 Q3 and, you know, that all was validated and and frankly, you know, running that combined or stream into the Maginot Mill from really mid July, until we did, have that capacitor failure at the end of September metallurgic. Everything was performing quite well. Uh, both from a gravity recovery point of view as well as overall recovery. Uh, the expectations were as per what we were expecting as far as what we modeled.

You're seeing in the plant.

So it's a pretty easy, simple transition. Just provide that feedback into the stream and combine the two streams into one, feeding into the one mill complex.

Okay.

And then just as a final question, turning to Lin Lake development. You know, we see that the timeline has been impacted by the uh the wildfires. How about capex can you give any more granularity on the implications to the Catholic estimate to develop that project?

What they're over the next because of the fact that it's been delayed a bit. Um, I think what we've

You know, we've basically lost all of the construction season this summer, which is, you know, the the the most productive period that you can have certainly in in, in Northern Manitoba or Northern Ontario, depending on where we're building these operations. So,

Uh, as a result of that, you know, our original timeline was mid 2028. Now, we're, we're, we're moving that out to early 2029. So you're going to have a bit of an inflation factor that, that gets factored into that. Yeah, I mean, it just just adding to that we, we put out the study, uh, a couple years ago, so you have 3 years of inflation. Um, since we put out that study, um, with with this additional year that, um,

That Luke just commented on, moving it out to 2029 and inflation on on capital projects is run around, you know, 5 to 6%. So we you can expect um a 15% increase in our Capital um that we put out in the feasibility study for for limb Lake.

Okay, thank you.

Uh, well, thank you for taking my questions. That's all for me and, uh, good luck with the rest of the quarter.

Thank you.

There are no further questions registered. At this time, this concludes this morning calls. If you have any further questions that have not been answered. Please feel free to contact, Mr. Scott Parsons, at 4163689932 extension 5439.

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